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Share Name | Share Symbol | Market | Type |
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Tier Reit, Inc. | NYSE:TIER | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
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0.00 | 0.00% | 28.88 | 0 | 01:00:00 |
þ | Preliminary Proxy Statement | |
o | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) | |
o | Definitive Proxy Statement | |
o | Definitive Additional Materials | |
o | Soliciting Material Pursuant to §240.14a-12 |
þ | No fee required. | |
o | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
(1) | Title of each class of securities to which transaction applies: | ||
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(2) | Aggregate number of securities to which transaction applies: | ||
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(3) | 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) | Proposed maximum aggregate value of transaction: | ||
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(5) | Total fee paid: | ||
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o | Fee paid previously with preliminary materials. | |
o | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
(1) | Amount Previously Paid: | ||
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(2) | Form, Schedule or Registration Statement No.: | ||
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(3) | Filing Party: | ||
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(4) | Date Filed: | ||
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Keith S. Omsberg | 10780 Parkridge Boulevard | |
Corporate Secretary | Reston, Virginia 20191 | |
February XX, 2009 |
TIME:
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10:00 a.m. Eastern Time on Wednesday, March 11, 2009. | |
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PLACE:
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Tier Technologies, Inc. corporate headquarters, 10780 Parkridge Boulevard, Suite 400, Reston, Virginia 20191. | |
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ITEMS OF BUSINESS:
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(1) To elect nine directors;
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(2) To ratify the selection of McGladrey & Pullen, LLP as our
independent registered public accounting firm for the fiscal
year ending September 30, 2009;
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(3)
& (4) To act on two shareholder proposals expected to come before
the meeting; and
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(5) To transact other business properly coming before the
meeting.
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WHO CAN VOTE:
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You can vote if you were a stockholder of record at the close of business on January 16, 2009. |
INFORMATION ABOUT THE PROXY MATERIALS AND OUR 2009 ANNUAL MEETING OF STOCKHOLDERS
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GENERAL INFORMATION
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1. WHO IS MAKING THIS SOLICITATION?
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2. WHAT INFORMATION IS CONTAINED IN THESE MATERIALS?
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3. WHEN AND WHERE IS THE ANNUAL MEETING?
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4. WHAT PROPOSALS ARE BEING PRESENTED FOR STOCKHOLDER VOTE AT THE ANNUAL MEETING?
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5. WHAT OTHER MATTERS MAY ARISE AT THE ANNUAL MEETING?
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6. WHO WILL BEAR THE COST OF SOLICITING VOTES FOR THE ANNUAL MEETING?
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7. WHAT DO I NEED FOR ADMISSION TO THE ANNUAL MEETING?
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8. WHAT SHOULD I DO IF I RECEIVE A PROXY CARD FROM DISCOVERY?
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9. HOW CAN I FIND TIERS PROXY MATERIALS AND ANNUAL REPORT ON THE INTERNET?
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10. WHOM SHOULD I CALL IF I HAVE QUESTIONS OR NEED ADDITIONAL COPIES OF THE PROXY
MATERIALS?
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VOTING MECHANICS
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11. WHO IS ENTITLED TO VOTE AT THE ANNUAL MEETING?
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12. WHAT IS THE RECORD DATE AND WHAT DOES IT MEAN?
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13. HOW CAN I VOTE MY SHARES OF COMMON STOCK?
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14. HOW CAN I REVOKE A PROXY OR CHANGE MY VOTING INSTRUCTIONS?
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15. WILL MY SHARES BE VOTED IF I DO NOT PROVIDE INSTRUCTIONS TO MY BROKER?
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16. WHO WILL COUNT THE VOTES?
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VOTING INFORMATION
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17. WHAT ARE THE VOTING CHOICES WHEN VOTING ON PROPOSAL ONE, THE ELECTION OF DIRECTORS?
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18. WHAT VOTE IS NEEDED TO ELECT THE DIRECTORS?
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19. WHAT ARE THE VOTING CHOICES WHEN VOTING ON PROPOSAL TWO, THE RATIFICATION OF THE
SELECTION OF MCGLADREY & PULLEN, LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM?
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20. WHAT VOTE IS NEEDED TO RATIFY THE SELECTION OF MCGLADREY & PULLEN, LLP AS OUR INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM?
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21. WHAT ARE
THE VOTING CHOICES WHEN VOTING ON PROPOSALS THREE AND FOUR, THE SHAREHOLDER
PROPOSALS?
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22. WHAT
VOTE IS NEEDED TO APPROVE PROPOSALS THREE AND FOUR, THE SHAREHOLDER PROPOSALS?
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23. AM I
PERMITTED TO VOTE FOR ONE SHAREHOLDER PROPOSAL AND AGAINST THE OTHER?
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24. HOW MANY VOTES MUST BE PRESENT TO HOLD THE ANNUAL MEETING?
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25. WHAT IF A QUORUM IS NOT PRESENT AT THE MEETING?
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26. WHAT IF I RETURN MY GOLD PROXY CARD BUT DO NOT GIVE VOTING INSTRUCTIONS?
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27. WHAT IF OTHER MATTERS ARE VOTED ON AT THE MEETING?
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28. WHAT DOES IT MEAN IF I RECEIVE MORE THAN ONE PROXY OR VOTING INSTRUCTION CARD?
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29. WHERE CAN I FIND THE VOTING RESULTS OF THE ANNUAL MEETING?
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STOCK OWNERSHIP
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CORPORATE GOVERNANCE MATTERS
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MEETING AND COMMITTEES OF THE BOARD OF DIRECTORS
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PROPOSAL ONE: ELECTION OF DIRECTORS
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REMOVAL OF DIRECTORS
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COMPENSATION COMMITTEE REPORT
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ii
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COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
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COMPENSATION DISCUSSION AND ANALYSIS
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EXECUTIVE COMPENSATION
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SUMMARY COMPENSATION TABLE
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FISCAL 2008 GRANTS OF PLAN-BASED AWARDS
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OUTSTANDING EQUITY AWARDS AT 2008 FISCAL YEAR-END
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FISCAL 2008 OPTION EXERCISES AND STOCK VESTED
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DIRECTOR COMPENSATION
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REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
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PRINCIPAL ACCOUNTING FEES AND SERVICES
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PROPOSAL TWO: RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
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PROPOSALS
THREE AND FOUR: SHAREHOLDER PROPOSALS
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OTHER MATTERS
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ADDITIONAL INFORMATION
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APPENDIX A
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48 |
1. | WHO IS MAKING THIS SOLICITATION? |
The Board of Directors, or Board, is soliciting your proxy for use at the Annual Meeting of Stockholders of Tier Technologies, Inc. or at any adjournment or postponement of the annual meeting. The Board is providing these proxy solicitation materials to give you information for use in determining how to vote in connection with the annual meeting. |
2. | WHAT INFORMATION IS CONTAINED IN THESE MATERIALS? |
The information included in this proxy statement relates to the proposals to be voted on at the annual meeting, the voting process, the compensation of directors and our most highly paid executive |
officers, and certain other required information. Our Annual Report on Form 10-K for the year ended September 30, 2008, as amended, which includes the Companys audited consolidated financial statements, is also enclosed. |
3. | WHEN AND WHERE IS THE ANNUAL MEETING? |
The Annual Meeting of Stockholders of Tier Technologies, Inc. will be held on March 11, 2009 at 10:00 a.m. Eastern Time, at Tiers headquarters located at 10780 Parkridge Boulevard, Suite 400, Reston, Virginia 20191. |
4. | WHAT PROPOSALS ARE BEING PRESENTED FOR STOCKHOLDER VOTE AT THE ANNUAL MEETING? |
Four proposals are scheduled for voting at the annual meeting: |
You can find information about the Boards nominees, as well as information about the Board, its committees, and other related matters, beginning on page 13. Information regarding director compensation can be found beginning on page 40. |
You can find information about Tiers relationship with McGladrey & Pullen, LLP beginning on page 42. |
You can find information about the shareholder proposals beginning on page 43. Because the shareholder proposals present non-binding resolutions, we will not be required to take the requested actions if the proposals are approved. However, if shareholders approve one or both of the proposals, we will reevaluate our shareholder rights plan and/or the bylaw regarding special meetings in light of the vote, as appropriate. | ||
For each shareholder proposal to be properly presented at the annual meeting, the shareholder that submitted the proposal (or a qualified representative of that shareholder) must appear at the annual meeting to present the proposal. For these purposes, to be considered a qualified representative of a shareholder, a person must be a duly authorized officer, manager, or partner of that shareholder or must be authorized by a writing executed by the shareholder or an electronic transmission delivered by the shareholder to act for the shareholder as proxy at the annual meeting, and such person must produce the writing or electronic transmission, or a reliable reproduction of the writing or electronic transmission, at the annual meeting. |
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We will also consider any other business that properly comes before the annual meeting. |
5. | WHAT OTHER MATTERS MAY ARISE AT THE ANNUAL MEETING? |
We do not know of any other matters that will come before the shareholders at the annual meeting. The Chairman of the annual meeting may refuse to allow presentation of a proposal or a nomination for the Board if the proposal or nomination was not properly submitted. The requirements for properly submitting proposals and nominations for this years annual meeting were described in our proxy statement for the 2008 annual meeting and are similar to those described on page 47 for next years meeting. |
6. | WHO WILL BEAR THE COST OF SOLICITING VOTES FOR THE ANNUAL MEETING? |
Tier is making this solicitation of proxies and will bear all related costs. We will conduct the solicitation by mail, personally, telephonically, through the Internet, or by facsimile through our officers, directors, and employees identified on Appendix A, none of whom will receive additional compensation for assisting with the solicitation. We may also solicit shareholders through press releases issued by the Company, advertisements in periodicals, and postings on the Companys website. We have also retained Laurel Hill Advisory Group to assist in the solicitation of proxies, for a fee estimated to be approximately $8,500 plus out-of-pocket expenses. In addition, we have agreed to indemnify Laurel Hill against certain liabilities arising out of or in connection with the engagement. Laurel Hill has advised us that approximately 20 of its employees will be involved in the proxy solicitation by Laurel Hill on behalf of Tier. |
7. | WHAT DO I NEED FOR ADMISSION TO THE ANNUAL MEETING? |
You are entitled to attend the annual meeting only if you are a shareholder of record or a beneficial owner of Tier stock as of the close of business on January 16, 2009, or you hold a valid proxy for the annual meeting. If you are the shareholder of record, your name will be verified against the list of shareholders of record prior to your admittance to the annual meeting. You should be prepared to present photo identification for admission. If you hold your shares in street name, you should provide proof of beneficial ownership on the record date, such as a brokerage account statement showing that you owned Tier common stock as of the record date, a copy of the GOLD voting instruction card provided by your broker, bank, or other nominee, or other similar evidence of ownership as of the record date, as well as your photo identification, for admission. If you do not provide photo identification or comply with the other procedures outlined above upon request, you will not be admitted to the annual meeting. |
8. | WHAT SHOULD I DO IF I RECEIVE A PROXY CARD FROM DISCOVERY? |
Discovery has provided notice that it intends to nominate two nominees for election as directors at the annual meeting and solicit proxies for use at the annual meeting to vote in favor of its nominees. You may receive proxy solicitation materials from Discovery, including an opposition proxy statement and proxy card. OUR BOARD OF DIRECTORS URGES YOU NOT TO SIGN OR RETURN ANY PROXY CARD SENT TO YOU BY DISCOVERY. Even if you have previously signed a proxy card sent by Discovery, you have the right to change your vote by following the instructions on the GOLD proxy card to submit your proxy by telephone or by Internet or by signing, dating, and mailing the enclosed GOLD proxy card in the postage-paid envelope provided. Only the latest dated proxy you submit will be counted. We urge you to disregard any proxy card sent to you by Discovery or any person other than Tier. |
9. | HOW CAN I FIND TIERS PROXY MATERIALS AND ANNUAL REPORT ON THE INTERNET? |
Our proxy statement and Annual Report on Form 10-K for fiscal year 2008, as amended on January XX, 2009, are available electronically at http://materials.proxyvote.com/88650Q . |
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10. | WHOM SHOULD I CALL IF I HAVE QUESTIONS OR NEED ADDITIONAL COPIES OF THE PROXY MATERIALS? |
If you have questions, require any assistance with voting your shares, or need additional copies of this proxy statement, please call our proxy solicitor, Laurel Hill Advisory Group, toll-free at (888) 742-1305. |
11. | WHO IS ENTITLED TO VOTE AT THE ANNUAL MEETING? |
Only holders of record of shares of our common stock at the close of business on January 16, 2009, or the record date, are entitled to vote at the annual meeting, or at adjournments or postponements of the annual meeting. As of the record date there were 19,734,863 shares of our common stock outstanding and entitled to vote. | ||
Except in connection with Proposal One (the election of directors), each share of common stock is entitled to one vote for each matter to be voted on at the annual meeting. In connection with the election of directors, each share is entitled to nine votes, one vote for each board seat that is being elected. The holders of a majority of the shares of common stock outstanding and entitled to vote at the annual meeting will constitute a quorum for the transaction of business at the annual meeting. Abstentions and broker non-votes will be counted towards a quorum, but will not be counted in determining whether a proposal is approved. |
12. | WHAT IS THE RECORD DATE AND WHAT DOES IT MEAN? |
The record date is January 16, 2009. Holders of common stock at the close of business on the record date are entitled to receive notice of the meeting and to vote at the meeting and any adjournments or postponements of the meeting. |
13. | HOW CAN I VOTE MY SHARES OF COMMON STOCK? |
There are four ways to vote for the Boards nominees and on the other matters as set forth in this proxy statement: |
| Telephone: If your proxy card or voting instruction card provides instructions for proxy authorization by telephone, follow the instructions on your proxy card or voting instruction card; OR | ||
| Mail: Mark, sign, and date your proxy card and return it to: Tier Technologies, Inc., c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717; OR | ||
| In-Person: If you are a record holder or have obtained a valid proxy from the record holder, mark, sign and submit a ballot during the 2009 Annual Meeting of Stockholders on March 11, 2009 at 10:00 a.m. Eastern Time; OR | ||
| Internet : Follow the instructions for Internet proxy authorization on your proxy card or voting instruction card. |
If you deliver a properly executed written proxy, or submit a properly completed proxy by telephone or by Internet, that proxy will be voted at the annual meeting in accordance with the directions given in the proxy, unless you revoke the proxy before the annual meeting. The proxies also may be voted at any adjournments or postponements of the annual meeting. |
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If you want to specify how your votes are cumulated you must do so in writing with a proxy card or, if you are a record holder of Tier stock or have obtained a valid proxy from the record holder, in person at the annual meeting. |
14. | HOW CAN I REVOKE A PROXY OR CHANGE MY VOTING INSTRUCTIONS? |
You can revoke a proxy before the close of voting at the annual meeting by: |
| Giving written notice to Tiers Corporate Secretary located at 10780 Parkridge Boulevard, Suite 400, Reston, Virginia 20191; | ||
| Submitting a new proxy card bearing a date later than your last proxy card; | ||
| Following the instructions for Internet proxy authorization that appear on the proxy card; | ||
| Following the instructions that appear on the proxy card for proxy authorization by telephone; or | ||
| If you are a record holder of Tier stock or have obtained a valid proxy from the record holder, attending the annual meeting and voting in person. Attendance at the annual meeting will not, by itself, revoke a proxy. |
15. | WILL MY SHARES BE VOTED IF I DO NOT PROVIDE INSTRUCTIONS TO MY BROKER? |
If you are the beneficial owner of shares held in street name by a broker, the broker, as the record holder of the shares, is required to vote those shares in accordance with your instructions. If you do not give instructions to the broker, the broker will be entitled to vote the shares with respect to discretionary proposals but will not be permitted to vote the shares with respect to non-discretionary proposals (those shares are treated as broker non-votes). The shareholder proposals are non-discretionary proposals. | ||
If Discovery solicits proxies to elect Discoverys nominees to the Board at the annual meeting, then the election of directors will also be a non-discretionary proposal for any brokerage accounts solicited by Discovery. As a result, if your shares are held in street name and Discovery provides you with proxy solicitation materials through your broker and you do not provide instructions as to how your shares are to be voted in the election of directors, your broker or other nominee will not be able to vote your shares in the election of directors, and your shares will not be voted for any of Tiers nominees. We urge you to provide instructions to your broker or nominee so that your votes may be counted on this important matter. We urge you to vote your shares by following the instructions provided on the enclosed GOLD proxy card and returning the GOLD proxy card to your bank, broker, or other nominee to ensure that your shares will be voted on your behalf. |
16. | WHO WILL COUNT THE VOTES? |
A representative of IVS Associates, Inc., an independent voting services company, will tabulate the votes and act as Inspector of Elections. |
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17. | WHAT ARE THE VOTING CHOICES WHEN VOTING ON PROPOSAL ONE, THE ELECTION OF DIRECTORS? |
Shareholders may use the enclosed GOLD proxy card to: |
| Vote FOR (in favor of) all of the Boards nominees; | ||
| WITHHOLD votes from all nominees; or | ||
| WITHHOLD votes from specific Board nominees; or | ||
| Provide instructions for cumulating votes for one or more specific Board nominees. |
18. | WHAT VOTE IS NEEDED TO ELECT THE DIRECTORS? |
Directors will be elected by the affirmative vote of a plurality of votes cast by shareholders entitled to vote on the matter, which means that the nine director nominees with the highest number of affirmative votes will be elected. | ||
Tiers certificate of incorporation gives shareholders the right to cumulate their votes. This means that a shareholder has the right to give any one nominee a number of votes equal to the number of directors to be elected multiplied by the number of shares the shareholder would otherwise be entitled to vote, or to distribute such votes among as many nominees (up to the number of persons to be elected) as the shareholder may wish. There are no conditions precedent to cumulative voting by Tier shareholders. Pursuant to Delaware law, the proxies are agents for the shareholders; if you specify how your votes are to be cumulated among the Boards nominees, the proxies named on the proxy card will cast your votes as you specify. Shareholders may specify how their votes are to be cumulated with respect to the Boards nominees by giving instructions on the enclosed form of proxy as to how the votes are to be cumulated or, if the shareholder is a record holder or has obtained a valid proxy from the record holder, by voting in person at the annual meeting. | ||
Unless you specify how your votes are to be cumulated among the Boards nominees, the proxy solicited by the Board authorizes the proxies named on the proxy card to cumulate votes that you are entitled to cast at the annual meeting in connection with the election of directors; provided that the proxies will not cumulate votes for any nominee from whom you have withheld authority to vote. To specify different directions with regard to cumulative voting, including to direct that the proxy holders cumulate votes with respect to a specific Board nominee or nominees, you must mark the appropriate box on the front of the proxy card and write your instructions on the reverse side. |
19. | WHAT ARE THE VOTING CHOICES WHEN VOTING ON PROPOSAL TWO, THE RATIFICATION OF THE SELECTION OF MCGLADREY & PULLEN, LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM? |
Shareholders may: |
| Vote FOR (in favor of) the ratification; | ||
| Vote AGAINST the ratification; or | ||
| ABSTAIN from voting on the ratification. |
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20. | WHAT VOTE IS NEEDED TO RATIFY THE SELECTION OF MCGLADREY & PULLEN, LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM? |
The selection of the independent registered public accounting firm will be ratified if it receives the affirmative vote of a majority of the shares voting on the matter. |
21. | WHAT ARE THE VOTING CHOICES WHEN VOTING ON PROPOSALS THREE AND FOUR, THE SHAREHOLDER PROPOSALS? |
Proposal Three requests that the Board eliminate our shareholder rights plan, and Proposal Four requests that the Board revise our bylaws to permit the holders of 10% of our common stock to call special meetings of shareholders. |
Shareholders may, with respect to each proposal: |
| Vote FOR (in favor of) the proposal; | ||
| Vote AGAINST the proposal; or | ||
| ABSTAIN from voting on the proposal. |
22. | WHAT VOTE IS NEEDED TO APPROVE PROPOSALS THREE AND FOUR, THE SHAREHOLDER PROPOSALS? |
Each shareholder proposal will be approved if it receives the affirmative vote of a majority of the shares voting on the matter. |
23. | AM I PERMITTED TO VOTE FOR ONE SHAREHOLDER PROPOSAL AND AGAINST THE OTHER? |
Yes. You may vote for both shareholder proposals, against both shareholder proposals, or for one shareholder proposal and against the other. |
24. | HOW MANY VOTES MUST BE PRESENT TO HOLD THE ANNUAL MEETING? |
A majority of the shares of common stock outstanding and entitled to vote at the annual meeting that are either present in person or represented by proxy will constitute a quorum for the annual meeting. Abstentions and broker non-votes are included in determining the number of votes present, but will not be counted in determining whether a proposal is approved. |
25. | WHAT IF A QUORUM IS NOT PRESENT AT THE MEETING? |
If a quorum is not present at the scheduled time of the annual meeting, we may adjourn the meeting, either with or without the vote of the shareholders. If we propose to have the shareholders vote whether to adjourn the meeting, the proxy holders will exercise their discretion to vote all shares for which they have authority in favor of the adjournment. |
26. | WHAT IF I RETURN MY GOLD PROXY CARD BUT DO NOT GIVE VOTING INSTRUCTIONS? |
If you sign your GOLD proxy card but do not give voting instructions, the shares represented by that proxy will be voted as recommended by the Board. The Board recommends a vote FOR the election of the seven director nominees named in this Proxy Statement, FOR Proposal Two, the ratification of McGladrey & Pullen, LLP as our independent registered public accounting firm for 2009, and AGAINST the shareholder proposals under Proposal Three and Proposal Four. Unless you specify how your votes are to be cumulated among the Boards nominees, the GOLD proxy card authorizes the proxies named on the card to cumulate votes that you are entitled to cast at the annual meeting at their discretion among the Boards nominees in connection with the election of directors. |
27. | WHAT IF OTHER MATTERS ARE VOTED ON AT THE MEETING? |
If any other matters are properly presented at the Meeting for consideration, the persons named as proxies in the enclosed GOLD proxy card will have discretion to vote on those matters for you. On the date we filed this Proxy Statement with the Securities and Exchange Commission, the Board did not know of any other matter to be raised at the Meeting. |
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28. | WHAT DOES IT MEAN IF I RECEIVE MORE THAN ONE PROXY OR VOTING INSTRUCTION CARD? |
If your shares are registered differently or are held in more than one account, you will receive a GOLD proxy card or GOLD voting instruction card for each account. To ensure that all of your shares are voted, please use all the GOLD proxy cards and GOLD voting instruction cards you receive to submit your proxy for your shares by telephone or by Internet or complete, sign, date, and return a GOLD proxy card or GOLD voting instruction card for each account. | ||
As previously noted, Discovery has provided notice that it intends to nominate two nominees for election as directors at the annual meeting and solicit proxies for use at the annual meeting to vote in favor of its nominees. As a result, you may receive proxy cards from both Discovery and the Company. To ensure shareholders have the Companys latest proxy information and materials to vote, the Board of Directors expects to conduct multiple mailings prior to the date of the annual meeting, each of which will include a GOLD proxy card regardless of whether or not you have previously submitted your proxy. Only the latest dated proxy you submit will be counted. | ||
OUR BOARD OF DIRECTORS URGES YOU NOT TO SIGN OR RETURN ANY PROXY CARD SENT TO YOU BY DISCOVERY. Even if you have previously signed a proxy card sent by Discovery, you have the right to change your vote by re-submitting your proxy by telephone or by Internet or by signing, dating, and returning the enclosed GOLD proxy card in the postage-paid envelope provided. Only the latest dated proxy you submit will be counted. We urge you to disregard any proxy card sent to you by Discovery. |
29. | WHERE CAN I FIND THE VOTING RESULTS OF THE ANNUAL MEETING? |
Tier will publish final results of the voting in our quarterly report on Form 10-Q for the second quarter of fiscal 2009, if we have not published a current report on Form 8-K containing such information at an earlier date. You will be able to read and print a copy of the Form 10-Q or Form 8-K on our website, http://www.tier.com , by choosing Investor Relations, Financial Information, and SEC Filings. You will also be able find the report by searching the SEC EDGAR filings at http://www.sec.gov . |
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Common stock beneficially owned | ||||||||
Name of beneficial owner (1) | Total number of shares | Percent of class (2) | ||||||
Charles W. Berger
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140,000 | (3) | * | |||||
Samuel Cabot III
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214,810 | (4) | 1.1 | % | ||||
John J. Delucca
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40,000 | (5) | * | |||||
Morgan P. Guenther
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151,000 | (6) | * | |||||
Philip G. Heasley
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10,002 | (7) | * | |||||
David A. Poe
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6,668 | (8) | * | |||||
James R. Stone
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38,337 | (9) | * | |||||
Steven M. Beckerman
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| * | ||||||
Kevin C. Connell
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77,400 | (10) | * | |||||
David E. Fountain
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| * | ||||||
Ronald W. Johnston
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| * | ||||||
Michael A. Lawler
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131,704 | * | ||||||
Keith S. Omsberg
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21,900 | (11) | * | |||||
Ronald L. Rossetti
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442,365 | (12) | 2.2 | % | ||||
Deanne M. Tully
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| * | ||||||
All directors and executive officers as a group (13 persons)
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1,142,482 | (13) | 5.5 | % |
* | Less than 1% | |
(1) | Address: 10780 Parkridge Blvd, Suite 400, Reston, Virginia 20191. | |
(2) | The percentages shown are based on 19,734,863 shares of common stock outstanding as of January 16, 2009. | |
(3) | Consists entirely of shares issuable upon the exercise of options exercisable on or before March 17, 2009. | |
(4) | Includes 195,000 shares issuable upon the exercise of options exercisable on or before March 17, 2009. | |
(5) | Consists entirely of shares issuable upon the exercise of options exercisable on or before March 17, 2009. | |
(6) | Includes 150,000 shares issuable upon the exercise of options exercisable on or before March 17, 2009. | |
(7) | Consists entirely of shares issuable upon the exercise of options exercisable on or before March 17, 2009. | |
(8) | Consists entirely of shares issuable upon the exercise of options exercisable on or before March 17, 2009. | |
(9) | Consists entirely of shares issuable upon the exercise of options exercisable on or before March 17, 2009. | |
(10) | Consists entirely of shares issuable upon the exercise of options exercisable on or before March 17, 2009. | |
(11) | Consists entirely of shares issuable upon the exercise of options exercisable on or before March 17, 2009. | |
(12) | Includes 415,000 shares issuable upon the exercise of options exercisable on or before March 17, 2009. | |
(13) | Includes 1,094,307 shares issuable upon the exercise of options exercisable on or before March 17, 2009. |
Number of securities | ||||||||||||
to be issued upon | Weighted-average | Number of securities | ||||||||||
exercise of | exercise price of | remaining available for | ||||||||||
outstanding options, | outstanding | future issuance under | ||||||||||
warrant and rights (in | options, warrants | equity compensation | ||||||||||
Plan category | thousands) | and rights ($) | plans (in thousands) | |||||||||
Equity compensation plans
|
||||||||||||
Approved by security holders
|
2,702 | $ | 9.07 | 1,038 | ||||||||
Not approved by security holders
|
| | | |||||||||
Total
|
2,702 | $ | 9.07 | 1,038 | ||||||||
9
Amount and nature of | ||||||||
Name of beneficial owner | beneficial ownership | Percent of class | ||||||
Wells Fargo & Company
(1)
|
2,689,293 | 13.6 | % | |||||
Discovery Group I, LLC
(2)
|
1,957,563 | 9.9 | % | |||||
Heartland Advisors, Inc.
(3)
|
1,891,430 | 9.6 | % | |||||
Giant Investment, LLC
(4)
|
1,799,322 | 9.1 | % | |||||
Dimensional Fund Advisors
(5)
|
1,764,020 | 8.9 | % |
(1) | Based solely on information contained in a Schedule 13G filed with the SEC on January 23, 2009 by Wells Fargo & Company and its subsidiary, Wells Capital Management Incorporated. The address for Wells Fargo & Company is 420 Montgomery Street, San Francisco, California 94104. The address for Wells Capital Management Incorporated is 525 Market Street, San Francisco, California 94105. This table reflects the shares of common stock owned by Wells Fargo & Company and Wells Capital Management Incorporated as of December 31, 2008. | |
(2) | Address: 191 North Wacker Drive, Suite 1685, Chicago, Illinois 60606. Based solely on information contained in a Schedule 13D/A filed with the SEC by Discovery Group I, LLC on December 4, 2008. Discovery Group I, LLC is the general partner of Discovery Equity Partners, L.P. Discovery Equity Partners, L.P. beneficially owns 1,684,608 shares of common stock and Discovery Group I, LLC beneficially owns 1,957,563 shares of common stock. In addition, Daniel J. Donoghue and Michael R. Murphy are the managing members of Discovery Group I, LLC and may be deemed to beneficially own 1,957,563 shares of common stock. | |
(3) | Address: 789 North Water Street, Milwaukee, Wisconsin 53202. Based solely on information contained in a Schedule 13G/A filed with the SEC by Heartland Advisors, Inc. on February 8, 2008. This table reflects the shares of common stock that may be deemed beneficially owned by Heartland Advisors, Inc. as of December 31, 2007. | |
(4) | Address: 265 Franklin Street, 18th Floor, Boston, Massachusetts 02110. Based solely on information contained in a Schedule 13D/A filed with the SEC by Giant Investments, LLC on December 30, 2008. Parthenon Investors II, LP, is a managing member of Giant Investment, LLC, PCap Partners II, LLC is a general partner of Parthenon Investors II, LP, and PCap II, LLC is a managing member of PCap Partners II, LLC. As parents of Giant Investment, LLC, Parthenon Investors II, LP, PCap Partners II, LLC, and PCap II, LLC may be deemed to beneficially own their proportional interest in the shares of common stock directly and beneficially owned by Giant Investment, LLC, comprising 1,748,401 shares of common stock. In addition, John C. Rutherford and Ernest K. Jacquet are control persons of various entities indirectly investing in Giant Investment, LLC and may be deemed to beneficially own a proportional interest in the shares of common stock owned by Giant Investment, LLC, comprising 1,799,322 shares of common stock. | |
(5) | Address: 1299 Ocean Avenue, 11th Floor, Santa Monica, California 90401. Based solely on information contained in a Schedule 13G filed with the SEC by Dimensional Fund Advisors Inc. on February 6, 2008. This table reflects the shares of common stock owned by Dimensional Fund Advisors Inc. on December 31, 2007. |
10
11
| financial literacy, demonstrated reputation for integrity, and the ability to exercise sound business judgment; | ||
| high personal and professional ethics; | ||
| understanding of the fiduciary responsibilities required as a member of the Board and the commitment, time, and ability to meet these responsibilities; and | ||
| an appropriate professional background providing an understanding of our technology, technology development, finance, sales, and marketing. |
| Any related person transaction proposed to be entered into by Tier must be reported to our General Counsel. | ||
| The Governance and Nominating Committee shall review and approve all related person transactions, prior to effectiveness or consummation of the transaction, whenever practicable. | ||
| If the General Counsel determines that advance approval of a related person transaction is not practicable under the circumstances, the Governance and Nominating Committee shall review and, in its discretion, may ratify the related person transaction at the next Governance and Nominating Committee meeting, or at the next meeting following the date that the related person transaction comes to the attention of the General Counsel; provided, however, that the General Counsel may present a related person transaction arising in the time period between meetings of the Governance and Nominating Committee to the Chair of the Governance and Nominating |
12
Committee, who shall review and may approve the related person transaction, subject to ratification by the Governance and Nominating Committee at the next meeting. | |||
| Previously approved transactions of an ongoing nature shall be reviewed by the Governance and Nominating Committee annually to ensure that such transactions have been conducted in accordance with the previous approval granted by the Governance and Nominating Committee, if any, and that all required disclosures regarding the related person transaction are made. |
| the related persons interest in the transaction, the dollar value of the amount involved, and the dollar value of the amount of the related persons interest, without regard to profit or loss; | ||
| whether the transaction was undertaken in the ordinary course of business; | ||
| whether the transaction with the related person is proposed to be, or was, entered into on terms no less favorable to us than terms that could have been reached with an unrelated third party; and | ||
| the purpose of, and potential benefits to us of, the transaction. |
Number of Members:
3
Members: Charles W. Berger (Chair) Samuel Cabot III (thru 9/30/08) Morgan P. Guenther James R. Stone (effective 10/01/08) Number of Meetings in Fiscal 2008: 10 |
Functions:
Selects the independent registered public accounting firm to audit Tiers books and records, subject to stockholder ratification, and determines the compensation of the independent registered public accounting firm. At least annually, reviews a report by the independent registered public accounting firm describing: internal quality control procedures, any issues raised by an internal or peer quality control review and any investigations by regulatory authorities. Consults with the independent registered public accounting firm, reviews and approves the scope of their audit, and reviews independence and performance. Also reviews any proposed engagement between Tier and the independent registered public accounting firm and approves in advance |
13
|
any such engagement,
if appropriate.
Reviews internal controls, accounting practices and financial reporting, including the results of the annual audit and the review of the interim financial statements, with management and the independent registered public accounting firm. Discusses earnings releases and guidance provided to the public. As appropriate, obtains advice and assistance from outside legal, accounting or other advisors. Prepares a report of the Audit Committee to be included in our proxy statement. Assesses annually the adequacy of the Audit Committee Charter. Reports to the Board about these matters. |
Number of Members:
3
Members: Samuel Cabot III (Chair) Charles W. Berger (thru 9/30/08) Morgan P. Guenther Philip G. Heasley (effective 10/01/08) Number of Meetings in Fiscal 2008: 11 |
Functions:
Reviews and approves the compensation of our Chief Executive Officer and other executive officers. Reviews executive bonus plan allocations. Oversees and advises the Board on the adoption of policies that govern our compensation programs. Oversees the administration of our equity-based compensation and other benefit plans. Approves grants of stock options and stock awards to our officers and employees. |
Number of Members:
3
Members: Morgan P. Guenther (Chair) John J. Delucca (effective 4/23/08) Samuel Cabot (effective 10/1/08) James R. Stone (7/22/08 9/30/08) T. Michael Scott (thru 2/28/08) Bruce R. Spector (thru 2/28/08) Number of Meetings in Fiscal 2008: 5 |
Functions:
Interviews, evaluates and recommends individuals for membership on the Board and its committees. Evaluates and recommends, where appropriate, whether a member of the Board qualifies as independent within the meaning of the applicable NASDAQ rules. Recommends guidelines and responsibilities relating to corporate governance for adoption by the Board. Reviews, approves or ratifies related person transactions. Evaluates and recommends director compensation. |
14
15
16
17
| If the holders of 17,999,999 shares voted in favor of the directors removal, and the holders of 2,000,001 shares voted against removal, then the director would not be removed. The director would not be removed because the total number of possible votes that could be cast in the election of a nine member Board would be 180,000,000, with the top nine vote recipients being elected to the Board, meaning that 18,000,001 would be the threshold number of votes necessary to secure a seat on the Board in a contested election (and, therefore, to defeat a proposal to remove a director). Since the holders of 2,000,001 shares would be entitled to cast 18,000,009 votes, the director would remain on the Board. | |
| If the holders of 18,000,001 shares voted in favor of the directors removal, and the holders of 1,999,999 shares voted against removal, then the director would be removed. The director would be removed because the holders of 1,999,999 shares would be entitled to cast 17,999,991 votes, falling 10 votes short of the number of votes that would be required to secure a seat on the Board in a contested election (and, therefore, to defeat a proposal to remove a director). |
18
| attract, retain, and motivate talented employees; | ||
| support business strategies that promote sustained growth and development; | ||
| reward the achievement of business results through the delivery of competitive pay and performance-based incentive programs; and | ||
| link executives goals with the interests of shareholders by tying a portion of compensation to our stock. |
19
| reviewing and approving the compensation for our Chief Executive Officer and other executive officers; | ||
| reviewing executive bonus plan allocations; | ||
| overseeing and advising the Board on the adoption of policies that govern our compensation programs; and | ||
| approving grants of stock options and stock awards to our executive officers. |
20
ACI Worldwide Inc.
|
Intersections Inc. | S1 Corp | ||
Alliance Data Systems Corp
|
Inx Inc. | Techteam Global Inc. | ||
ASTA Funding Inc.
|
Metvante Technologies Inc. | TNS Inc. | ||
Bottomline Technologies Inc.
|
NIC Inc. | Total System Services Inc. | ||
CSG Systems International Inc.
|
Online Resources Inc. | TRX | ||
CyberSource Corp.
|
Quality Systems Inc. | Tyler Technologies Inc. | ||
Fiserv Inc.
|
Radiant Systems Inc. | Wright Express Corp | ||
Global Payments Inc.
|
21
Base salary rate by fiscal year | % change | % change | ||||||||||||||||||
2007 | 2008 | 2009 | 2007 to 2008 | 2008 to 2009 | ||||||||||||||||
Ronald L. Rossetti
|
||||||||||||||||||||
Chief Executive Officer and Chairman of the
Board
|
$ | 600,000 | (1 | ) | $ | 400,000 | (1 | ) | (1 | ) | ||||||||||
Ronald W. Johnston
(2)
|
||||||||||||||||||||
Senior Vice President, Chief Financial Officer
|
N/A | 275,000 | 272,000 | N/A | -1 | % | ||||||||||||||
Kevin C. Connell
|
||||||||||||||||||||
Senior Vice President, Sales & Marketing
|
250,000 | 250,000 | 250,000 | 0 | % | 0 | % | |||||||||||||
Keith Omsberg
|
||||||||||||||||||||
Vice President, General Counsel and Corporate
Secretary
|
N/A | 190,000 | 190,000 | N/A | 0 | % |
(1) | Pursuant to Mr. Rossettis employment agreement signed April 30, 2008, Mr. Rossettis base salary was reduced from $600,000 to $400,000 per annum, a reduction of 33%, effective May 1, 2008. | |
(2) | Mr. Johnston voluntarily reduced his base salary from $275,000 to $272,000 for fiscal 2009 effective January 2009. |
| align the management teams financial interests with those of our shareholders; | ||
| support a performance-oriented environment that rewards business unit and Tiers overall results; | ||
| attract, motivate, and retain key management critical to Tiers long-term success; and |
22
| align compensation with Tiers business strategy, values, and management initiatives. |
23
Threshold: | Target: | Maximum: | ||||||||||
92% of Performance | 100% of Performance | 107% of Performance | ||||||||||
Name | metric | metric | metric | |||||||||
David E. Fountain
|
$ | 47,923 | $ | 79,872 | $ | 159,744 | ||||||
Michael A. Lawler
|
32,451 | 54,085 | 108,170 | |||||||||
Kevin C. Connell
|
34,321 | 57,051 | 114,103 | |||||||||
Keith S. Omsberg
|
9,870 | 16,450 | 32,900 |
Named executive officer | 2008 payment | |||
Ronald L. Rossetti
|
$ | 390,513 | ||
Ronald W. Johnston
|
68,750 | |||
Kevin Connell
|
50,000 | |||
Keith Kendrick
|
| |||
Keith S. Omsberg
|
7,500 | |||
David E. Fountain
|
| |||
Michael A. Lawler
|
| |||
Deanne M. Tully
|
| |||
Steven M. Beckerman
|
| |||
Total incentive payout
|
$ | 516,763 | ||
24
25
| any person, entity, or affiliated group becoming the beneficial owner or owners of more than 50% of the outstanding equity securities of Tier, or otherwise becoming entitled to vote shares representing more than 50% of the undiluted total voting power of our then-outstanding securities eligible to vote to elect members of the Board; | ||
| a consolidation or merger (in one transaction or a series of related transactions) of Tier pursuant to which the holders of our equity securities immediately prior to such transaction or series of transactions would not be the holders immediately after such transaction or series of related transactions of more than 50% of the securities eligible to vote to elect members of the Board of the entity surviving such transaction or series of related transactions; or | ||
| the sale, lease, exchange, or other transfer (in one transaction or a series of related transactions) of all or substantially all of the assets of Tier. |
26
| any person, entity or affiliated group becoming the beneficial owner or owners of more than 50% of the outstanding equity securities of Tier, or otherwise becoming entitled to vote shares representing more than 50% of the undiluted total voting power of our then-outstanding securities eligible to vote to elect members of the Board; | ||
| a consolidation or merger (in one transaction or a series of related transactions) of Tier pursuant to which the holders of our equity securities immediately prior to such transaction or series of transactions would not be the holders immediately after such transaction or series of related transactions of more than 50% of the securities eligible to vote to elect members of the Board of the entity surviving such transaction or series of related transactions; | ||
| the sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all or substantially all of the assets of Tier; | ||
| the dissolution or liquidation of Tier; or | ||
| the date on which (i) we consummate a going private transaction pursuant to Section 13 and Rule 13e-3 of the Exchange Act, or (ii) no longer have a class of equity securities registered under the Exchange Act . |
| any person, entity or affiliated group becoming the beneficial owner or owners of more than 50% of the outstanding equity securities of Tier, or of a subsidiary that holds substantial assets or is the primary location of the strategic business unit or practice unit in which Mr. Beckerman was engaged or otherwise becoming entitled to vote shares representing more than 50% of the undiluted total voting power of the then-outstanding securities eligible to vote to elect members of the board of directors or of the business unit or practice units board of directors. |
| any person, entity or affiliated group becoming the beneficial owner or owners of more than 35% of the outstanding equity securities of Tier, or otherwise becoming entitled to vote |
27
shares representing more than 35% of the undiluted total voting power of our then-outstanding securities eligible to vote to elect members of the Board; | |||
| a consolidation or merger (in one transaction or a series of related transactions) of Tier pursuant to which the holders of our equity securities immediately prior to such transaction or series of related transactions would not be the holders immediately after such transaction or series of related transactions of at least 65% of the securities eligible to elect members of the board of directors of the entity surviving such transaction or series of related transactions; or | ||
| the sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all or substantially all of the assets of Tier. |
28
Non-equity | ||||||||||||||||||||||||||||||||
Stock | Option | incentive plan | All other | |||||||||||||||||||||||||||||
Name and principal | Salary | Bonus | awards | awards | compensation | compensation | Total | |||||||||||||||||||||||||
position | Year | ($) | ($) (1) | ($) (2) | ($) (2) | ($) (3) | ($) (4) | ($) | ||||||||||||||||||||||||
Ronald L. Rossetti
|
2008 | $ | 589,231 | $ | 390,513 | $ | 264,583 | $ | | $ | | $ | 278,363 | $ | 1,522,690 | |||||||||||||||||
Chief Executive Officer,
Chairman of the Board
|
2007 | 600,000 | 600,000 | | 119,375 | | 230,710 | 1,550,085 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Ronald W. Johnston
(5)
|
2008 | 172,158 | 68,750 | | 58,326 | | 4,943 | 304,177 | ||||||||||||||||||||||||
Senior Vice President,
Chief Financial Officer
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Kevin C. Connell
|
2008 | 251,923 | 50,000 | | 62,270 | | 6,685 | 370,878 | ||||||||||||||||||||||||
Senior Vice President
Sales and Marketing
|
2007 | 245,796 | | | 121,177 | 167,808 | 19,482 | 554,263 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Keith S. Omsberg
|
2008 | 188,000 | 92,500 | | 50,706 | | 5,585 | 336,791 | ||||||||||||||||||||||||
Vice President,
General Counsel
and Secretary
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
David E. Fountain
(6)
|
2008 | 181,731 | | | 52,969 | | 147,987 | 382,687 | ||||||||||||||||||||||||
Senior Vice President,
Chief Financial Officer and
Treasurer
|
2007 | 338,942 | 50,000 | | 67,313 | 175,000 | 137,174 | 768,429 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Michael A. Lawler
(7)
|
2008 | 232,442 | | | 71,313 | | 272,008 | 575,763 | ||||||||||||||||||||||||
Senior Vice President
Electronic Payment
Processing
|
2007 | 234,402 | | | 67,845 | 21,000 | 5,606 | 328,853 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Deanne M. Tully
(8)
|
2008 | 110,846 | | | 21,507 | | 255,696 | 388,049 | ||||||||||||||||||||||||
Vice President,
General Counsel and
Corporate Secretary
|
2007 | 219,117 | | | 48,805 | | 5,204 | 273,126 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Steven M. Beckerman
(9)
|
2008 | 221,692 | | | 106,356 | | 464,947 | 792,995 | ||||||||||||||||||||||||
Senior Vice President,
Government Business
Process Outsourcing
|
2007 | 220,000 | | | 61,071 | | 5,204 | 286,275 |
29
(1) | Reflects bonus payouts for fiscal years 2008 and 2007: |
Employment | ||||||||||||||||
Name | Year | agreement | Discretionary | Total bonus payout | ||||||||||||
Ronald L. Rossetti
|
2008 | $ | 166,667 | $ | 223,846 | $ | 390,513 | |||||||||
|
2007 | 600,000 | | 600,000 | ||||||||||||
|
||||||||||||||||
Ronald W. Johnston
|
2008 | 68,750 | | 68,750 | ||||||||||||
|
||||||||||||||||
Kevin C. Connell
|
2008 | | 50,000 | 50,000 | ||||||||||||
|
||||||||||||||||
Keith S. Omsberg
|
2008 | | 92,500 | 92,500 | ||||||||||||
|
||||||||||||||||
David E. Fountain
|
2007 | | 50,000 | 50,000 |
See | page 23 for additional information on bonus payments. | |
(2) | The amounts included in these columns reflect the value of stock awards and stock option awards that were recognized as an expense for financial statement reporting purposes in fiscal 2008 and 2007, calculated pursuant to Statement of Financial Accounting Standards 123R Share-Based Payment , excluding any estimate of forfeitures. Accordingly, the columns include amounts relating to awards granted during and prior to the year indicated. The following table summarizes the amounts shown in the Stock Awards and Option Awards columns and the amount included for each such award for fiscal 2008. Assumptions used in the calculation of these amounts and the amounts for fiscal 2007 are included in footnote 13 to the audited consolidated financial statements included in our annual report on Form 10-K for the fiscal year ended September 30, 2008. |
Stock Awards | Option Awards | |||||||||||||||||||||||
Total number of | ||||||||||||||||||||||||
Total number of | shares | |||||||||||||||||||||||
shares | underlying | |||||||||||||||||||||||
Date of | underlying | Amount included | Date of | options awarded | Amount included | |||||||||||||||||||
Name | award | shares awarded (#) | in fiscal 2008 ($) | award | (#) | in fiscal 2008 ($) | ||||||||||||||||||
Ronald L. Rossetti
|
4/30/08 | 550,000 | $ | 264,583 | | | $ | | ||||||||||||||||
|
||||||||||||||||||||||||
Ronald W. Johnston
|
| | | 7/1/08 | 200,000 | 58,326 | ||||||||||||||||||
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
Kevin C. Connell
|
| | | 10/4/02 | 25,000 | 608 | ||||||||||||||||||
|
7/3/03 | 25,000 | 19,265 | |||||||||||||||||||||
|
12/1/03 | 5,000 | 5,122 | |||||||||||||||||||||
|
11/1/04 | 3,000 | 2,891 | |||||||||||||||||||||
|
9/13/06 | 10,000 | 6,851 | |||||||||||||||||||||
|
11/28/06 | 40,000 | 27,533 | |||||||||||||||||||||
|
||||||||||||||||||||||||
|
62,270 | |||||||||||||||||||||||
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
Keith S. Omsberg
|
| | | 12/1/03 | 3,000 | 3,073 | ||||||||||||||||||
|
11/1/04 | 3,000 | 2,891 | |||||||||||||||||||||
|
9/13/06 | 10,000 | 6,852 | |||||||||||||||||||||
|
10/1/07 | 30,000 | 25,453 | |||||||||||||||||||||
|
12/10/07 | 20,000 | 12,437 | |||||||||||||||||||||
|
||||||||||||||||||||||||
|
50,706 | |||||||||||||||||||||||
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
David E. Fountain
|
| | | 8/12/05 | 75,000 | 35,655 | ||||||||||||||||||
|
8/24/06 | 40,000 | 17,314 | |||||||||||||||||||||
|
||||||||||||||||||||||||
|
52,969 | |||||||||||||||||||||||
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
Michael A. Lawler
|
| | | 11/1/04 | 50,000 | 48,179 | ||||||||||||||||||
|
8/24/06 | 40,000 | 23,134 | |||||||||||||||||||||
|
||||||||||||||||||||||||
|
71,313 | |||||||||||||||||||||||
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
Deanne M. Tully
|
| | | 12/1/03 | 10,000 | 5,124 | ||||||||||||||||||
|
11/1/04 | 10,000 | 4,819 | |||||||||||||||||||||
|
8/24/06 | 40,000 | 11,564 | |||||||||||||||||||||
|
||||||||||||||||||||||||
|
21,507 | |||||||||||||||||||||||
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
Steven M. Beckerman
|
| | | 4/7/06 | 50,000 | 62,439 | ||||||||||||||||||
|
8/24/06 | 40,000 | 43,917 | |||||||||||||||||||||
|
||||||||||||||||||||||||
|
106,356 | |||||||||||||||||||||||
|
30
(3) | Reflects cash incentive payouts for fiscal year 2007 under various non-equity incentive plans. |
Total non-equity incentive | ||||||||||||
Name | Year | Incentive plan | payout | |||||||||
Kevin C. Connell
|
2007 | 167,808 | 167,808 | |||||||||
|
||||||||||||
Michael A. Lawler
|
2007 | 21,000 | 21,000 |
(4) | Consists of: |
| the aggregate incremental cost to Tier of providing perquisites and other personal benefits; | ||
| company matching contributions under 401(k) plans; | ||
| tax reimbursement payments relating to certain business and non-business travel; and | ||
| severance expenses. |
Tax | Total all other | |||||||||||||||||||||||
Name | Year | Perquisites (a) | 401(k) | reimbursement | Severance (b) | compensation | ||||||||||||||||||
Ronald L. Rossetti
|
2008 | $ | 183,338 | $ | 6,900 | $ | 88,125 | $ | | $ | 278,363 | |||||||||||||
Ronald L. Rossetti
|
2007 | 191,435 | 6,750 | 32,525 | | 230,710 | ||||||||||||||||||
|
||||||||||||||||||||||||
Ronald W. Johnston
|
2008 | | 4,943 | | | 4,943 | ||||||||||||||||||
|
||||||||||||||||||||||||
Kevin C. Connell
|
2008 | | 6,685 | | | 6,685 | ||||||||||||||||||
Kevin C. Connell
|
2007 | 13,648 | 5,834 | | | 19,482 | ||||||||||||||||||
|
||||||||||||||||||||||||
Keith S. Omsberg
|
2008 | | 5,585 | | | 5,585 | ||||||||||||||||||
|
||||||||||||||||||||||||
David E. Fountain
|
2008 | 40,371 | 5,574 | 23,921 | 78,121 | 147,987 | ||||||||||||||||||
David E. Fountain
|
2007 | 88,310 | 6,750 | 42,114 | | 137,174 | ||||||||||||||||||
|
||||||||||||||||||||||||
Michael A. Lawler
|
2008 | | 6,750 | | 265,258 | 272,008 | ||||||||||||||||||
Michael A. Lawler
|
2007 | | 5,606 | | | 5,606 | ||||||||||||||||||
|
||||||||||||||||||||||||
Deanne M. Tully
|
2008 | | 4,173 | | 251,523 | 255,696 | ||||||||||||||||||
Deanne M. Tully
|
2007 | | 5,204 | | | 5,204 | ||||||||||||||||||
|
||||||||||||||||||||||||
Steven M. Beckerman
|
2008 | | 6,600 | | 458,347 | 464,947 | ||||||||||||||||||
Steven M. Beckerman
|
2007 | | 5,204 | | | 5,204 |
(a) | See Perquisites and Benefits in the Compensation Discussion and Analysis on page 26 for a discussion on perquisites provided to executives. Perquisites include: |
| expenses for corporate apartments, including utilities; | ||
| air and ground transportation, meals and lodging for personal travel; and | ||
| legal consultation fees relating to negotiation and review of employment agreement. The following table summarizes the amounts shown in the Perquisites column: |
Legal | ||||||||||||||||||||
Name | Year | Corporate apartment | Travel | consultation | Other | |||||||||||||||
Ronald L. Rossetti
|
2008 | $ | 39,096 | $ | 113,431 | $ | 30,811 | $ | | |||||||||||
Ronald L. Rossetti *
|
2007 | 41,232 | 130,375 | 19,828 | | |||||||||||||||
|
||||||||||||||||||||
Kevin C. Connell *
|
2008 | | | | | |||||||||||||||
|
2007 | | 13,648 | | | |||||||||||||||
|
||||||||||||||||||||
David E. Fountain
|
2008 | 20,420 | 19,951 | | | |||||||||||||||
David E. Fountain
|
2007 | 34,166 | 32,144 | 22,000 | |
* | Includes travel by chartered private jet for business meeting which Mr. Connell and Mr. Rossetti attended. Total cost was $27,295 and is split equally between Mr. Connell and Mr. Rossetti. | |
(b) | The amount in the severance column consists of severance payments and reimbursement for personal time off accrued but not used as of termination date. |
(5) | Mr. Johnston served as interim Chief Financial Officer from April 2008 to June 2008. | ||
(6) | Mr. Fountains employment with us terminated April 4, 2008. | ||
(7) | Mr. Lawlers employment with us terminated September 26, 2008. | ||
(8) | Ms. Tullys employment with us terminated March 31, 2008. From April 2008 to September 2008, Ms. Tully served as an independent consultant to Tier and was compensated $18,333 per month. | ||
(9) | Mr. Beckermans employment with us terminated September 30, 2008. |
31
All other | All other | |||||||||||||||||||||||||||||||
stock | option awards: | |||||||||||||||||||||||||||||||
Estimated future payouts under | awards: | Number of | Exercise or | Grant date fair | ||||||||||||||||||||||||||||
Non-Equity Incentive Plan Awards (1) | Number of | Securities | base price of | value of stock | ||||||||||||||||||||||||||||
Threshold | Target | Maximum | shares of | Underlying | option | and option | ||||||||||||||||||||||||||
Name | Grant date | ($) (2) | ($) (3) | ($) (4) | stock(#) (5) | Options(#) | awards ($) (6) | awards ($) (7) | ||||||||||||||||||||||||
Ronald L. Rossetti
|
04/30/08 | (8) | $ | | $ | | $ | | 550,000 | | $ | | $ | | ||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Ronald W. Johnston
|
07/01/08 | (9) | | 68,750 | 103,125 | | 200,000 | (15) | 8.01 | 701,840 | ||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Kevin C. Connell
|
12/10/07 | (10) | 34,321 | 57,051 | 114,103 | | | | | |||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Keith S. Omsberg
|
12/10/07 | (11) | 9,870 | 16,450 | 32,900 | | | | | |||||||||||||||||||||||
|
10/01/07 | (12) | | | | | 30,000 | (16) | 10.20 | 127,614 | ||||||||||||||||||||||
|
12/10/07 | (12) | | | | | 20,000 | (16) | 9.25 | 77,152 | ||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
David E. Fountain
|
12/10/07 | (13) | 47,923 | 79,872 | 159,744 | | | | | |||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Michael A. Lawler
|
12/10/07 | (14) | 32,451 | 54,085 | 108,170 | | | | | |||||||||||||||||||||||
Deanne M. Tully
|
| | | | | | | | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Steven M. Beckerman
|
| | | | | | | |
(1) | For additional information concerning performance metrics and payouts of non-equity incentive plan awards see page 22. | |
(2) | The threshold amount represents the amounts payable to the executive if we met a specific percentage of our corporate performance goal and practice unit performance goal, if applicable, for fiscal 2008 under the applicable plans. | |
(3) | The target amount represents the amounts payable to the executive if we met our corporate performance goal and, if applicable, practice unit performance goal for fiscal 2008 under the applicable plans. | |
(4) | The maximum estimated future payout for Mr. Johnston was 75% of his base salary from April 2008 September 2008. The maximum estimated future payout for Messrs. Connell, Fountain and Lawler represent the amounts payable to the executive if we met 107% of our corporate performance goal, and , if applicable, practice unit performance goal. | |
(5) | The shares vest April 30, 2011 provided the following share price performance targets are met and maintained for 60 consecutive days: 180,000 shares at share target price of $11, 185,000 shares at share target price of $13, and 185,000 shares at target price of $15. Of the 185,000 shares at target price of $15, 50,000 shares are intended to be settled in cash. | |
(6) | The exercise price of the options granted to the individuals shown above was the closing price of Tiers common stock on the day prior to the grant date. | |
(7) | Represents the full grant date fair value of each equity-based award, computed in accordance with SFAS 123R. | |
(8) | Awarded under the terms of Mr. Rossettis employment agreement. | |
(9) | Awarded under the terms of Mr. Johnstons employment agreement. | |
(10) | Awarded under the MIP, adopted by the Compensation Committee on December 10, 2007. On July 22, 2008, the Committee determined the performance metrics would not be met, and no awards were made under the MIP. | |
(11) | Awarded under the MIP, adopted by the Compensation Committee on December 10, 2007. On July 22, 2008, the Committee determined the performance metrics would not be met, and no awards were made under the MIP. | |
(12) | Award under the Companys Amended and Restated 2004 Stock Incentive Plan. | |
(13) | Awarded under the MIP, adopted by the Compensation Committee on December 10, 2007. On July 22, 2008, the Committee determined the performance metrics would not be met, and no awards were made under the MIP. | |
(14) | Awarded under the MIP, adopted by the Compensation Committee on December 10, 2007. On July 22, 2008, the Committee determined the performance metrics would not be met, and no awards were made under the MIP. | |
(15) | These options were awarded to Mr. Johnston upon his hire. These options vest as to 34% of the underlying shares the first year and 33% each subsequent year on the anniversary of the date granted and expire in ten years. | |
(16) | Of the 50,000 total options awarded to Mr. Omsberg, 20,000 were merit based and 30,000 were awarded in connection with his promotion to Corporate Secretary. These options vest as to 20% on the anniversary of the date granted and expire in ten years. |
32
Option Awards | Stock Awards | |||||||||||||||||||||||||||||||
Equity | ||||||||||||||||||||||||||||||||
incentive | ||||||||||||||||||||||||||||||||
Equity | plan | |||||||||||||||||||||||||||||||
incentive | awards: | |||||||||||||||||||||||||||||||
plan | Market or | |||||||||||||||||||||||||||||||
awards: | payout | |||||||||||||||||||||||||||||||
Number of | value of | |||||||||||||||||||||||||||||||
Number of | Market | unearned | unearned | |||||||||||||||||||||||||||||
securities | Number of | Number of | value of | shares, | shares, | |||||||||||||||||||||||||||
underlying | securities | shares or | shares or | units, or | units or | |||||||||||||||||||||||||||
unexercised | underlying | Option | units of | units of | other rights | other rights | ||||||||||||||||||||||||||
options | unexercised options | exercise | Option | stock that | stock that | that have | that have | |||||||||||||||||||||||||
(#) | (#) | price | expiration | have not | have not | not vested | not vested | |||||||||||||||||||||||||
Name | Exercisable | Unexercisable (a) | ($) | date | vested (#) | vested ($) | (#) (b) | ($) (c) | ||||||||||||||||||||||||
Ronald L. Rossetti
|
10,000 | | $ | 17.75 | 01/27/09 | |||||||||||||||||||||||||||
|
20,000 | | 6.81 | 07/25/09 | ||||||||||||||||||||||||||||
|
25,000 | | 6.94 | 01/21/11 | ||||||||||||||||||||||||||||
|
10,000 | | 19.56 | 01/22/12 | ||||||||||||||||||||||||||||
|
10,000 | | 13.75 | 01/30/13 | ||||||||||||||||||||||||||||
|
15,000 | | 8.62 | 01/27/14 | ||||||||||||||||||||||||||||
|
5,000 | | 9.77 | 10/07/14 | ||||||||||||||||||||||||||||
|
20,000 | | 8.30 | 06/29/15 | ||||||||||||||||||||||||||||
|
300,000 | | 5.50 | 07/25/16 | ||||||||||||||||||||||||||||
|
180,000 | $ | 1,324,800 | |||||||||||||||||||||||||||||
|
185,000 | 1,361,600 | ||||||||||||||||||||||||||||||
|
50,000 | (d) | $ | 368,000 | 135,000 | (d) | 993,600 | |||||||||||||||||||||||||
|
415,000 | | 50,000 | 500,000 | ||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Ronald W. Johnston
|
| 200,000 | (1) | 8.01 | 06/30/18 | |||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Kevin C. Connell
|
25,000 | | 16.90 | 10/03/12 | ||||||||||||||||||||||||||||
|
25,000 | | 7.86 | 07/02/13 | ||||||||||||||||||||||||||||
|
4,000 | 1,000 | (2) | 7.81 | 11/30/13 | |||||||||||||||||||||||||||
|
1,800 | 1,200 | (3) | 8.60 | 10/31/14 | |||||||||||||||||||||||||||
|
4,000 | 6,000 | (4) | 7.05 | 09/12/16 | |||||||||||||||||||||||||||
|
8,000 | 32,000 | (5) | 7.10 | 11/27/16 | |||||||||||||||||||||||||||
|
67,800 | 40,200 | ||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Keith Omsberg
|
2,500 | | 16.04 | 07/04/12 | ||||||||||||||||||||||||||||
|
2,400 | 600 | (6) | 7.81 | 11/30/13 | |||||||||||||||||||||||||||
|
1,800 | 1,200 | (7) | 8.60 | 10/31/14 | |||||||||||||||||||||||||||
|
4,000 | 6,000 | (8) | 7.05 | 09/12/16 | |||||||||||||||||||||||||||
|
| 30,000 | (9) | 10.20 | 09/30/17 | |||||||||||||||||||||||||||
|
| 20,000 | (10) | 9.25 | 12/09/17 | |||||||||||||||||||||||||||
|
10,700 | 57,800 | ||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
David E. Fountain
|
| | | | ||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Michael A. Lawler
(e)
|
30,000 | | 8.60 | 10/31/14 | ||||||||||||||||||||||||||||
|
16,000 | | 5.95 | 08/23/16 | ||||||||||||||||||||||||||||
|
46,000 | | ||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Deanne M. Tully
|
| | | | ||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Steven M. Beckerman
(f)
|
30,000 | | 8.70 | 04/06/16 | ||||||||||||||||||||||||||||
|
24,000 | | 5.95 | 08/23/16 | ||||||||||||||||||||||||||||
|
54,000 | | ||||||||||||||||||||||||||||||
33
(a) | Vesting of the unexercisable option awards are set forth below: |
Name | Footnote reference | Vesting date | Number | |||||||||
Ronald W. Johnston
|
(1 | ) | 07/01/09 | 66,666 | ||||||||
|
07/01/10 | 66,667 | ||||||||||
|
07/01/11 | 66,667 | ||||||||||
|
||||||||||||
Kevin C. Connell
|
(2 | ) | 12/01/08 | 1,000 | ||||||||
|
||||||||||||
|
(3 | ) | 11/01/08 | 600 | ||||||||
|
11/01/09 | 600 | ||||||||||
|
||||||||||||
|
(4 | ) | 09/13/09 | 2,000 | ||||||||
|
09/13/10 | 2,000 | ||||||||||
|
09/13/11 | 2,000 | ||||||||||
|
||||||||||||
|
(5 | ) | 11/28/08 | 8,000 | ||||||||
|
11/28/09 | 8,000 | ||||||||||
|
11/28/10 | 8,000 | ||||||||||
|
11/28/11 | 8,000 | ||||||||||
|
||||||||||||
Keith S. Omsberg
|
(6 | ) | 12/01/08 | 600 | ||||||||
|
||||||||||||
|
(7 | ) | 11/01/08 | 600 | ||||||||
|
11/01/09 | 600 | ||||||||||
|
||||||||||||
|
(8 | ) | 09/13/09 | 2,000 | ||||||||
|
09/13/10 | 2,000 | ||||||||||
|
09/13/11 | 2,000 | ||||||||||
|
||||||||||||
|
(9 | ) | 10/01/08 | 6,000 | ||||||||
|
10/01/09 | 6,000 | ||||||||||
|
10/01/10 | 6,000 | ||||||||||
|
10/01/11 | 6,000 | ||||||||||
|
10/01/12 | 6,000 | ||||||||||
|
||||||||||||
|
(10 | ) | 12/10/08 | 4,000 | ||||||||
|
12/10/09 | 4,000 | ||||||||||
|
12/10/10 | 4,000 | ||||||||||
|
12/10/11 | 4,000 | ||||||||||
|
12/10/12 | 4,000 |
(b) | The shares vest April 30, 2011 provided the following share price performance targets are met and maintained for 60 consecutive days. |
Share price | ||||||||
performance target | Number of units | |||||||
$ | 11 |
|
180,000 | |||||
13 |
|
185,000 | ||||||
15 |
|
185,000 | (c) |
(c) | The market value was determined by multiplying $7.36 (the closing price of Tiers stock at September 30, 2008) by the number of shares. | |
(d) | Of the 185,000 shares at the $15 share price performance target, 50,000 shares are payable in cash. | |
(e) | Mr. Lawlers employment with us terminated September 26, 2008; as such, all options ceased vesting on that date. | |
(f) | Mr. Beckermans employment with us terminated September 30, 2008; as such, all options ceased vesting on that date. |
34
Option awards | ||||||||
Number of shares | ||||||||
acquired on exercise | Value realized on | |||||||
Name | (#) | exercise ($) | ||||||
Ronald L. Rossetti
|
| $ | | |||||
|
||||||||
Ronald W. Johnston
|
| | ||||||
|
||||||||
Kevin C. Connell
|
| | ||||||
|
||||||||
Keith S. Omsberg
|
| | ||||||
|
||||||||
David E. Fountain
|
150 | 323 | ||||||
|
200 | 462 | ||||||
|
1,349 | 2,765 | ||||||
|
4,900 | 10,633 | ||||||
|
1,400 | 3,220 | ||||||
|
||||||||
|
7,999 | 17,403 | ||||||
|
||||||||
|
||||||||
Michael A. Lawler
|
| | ||||||
|
||||||||
Deanne M. Tully
|
8,000 | 15,600 | ||||||
|
||||||||
Steven M. Beckerman
|
| |
| a conviction of the named executive officer of, or a plea of guilty or nolo contendere by the named executive officer to, any felony; | ||
| an intentional violation by the named executive officer of federal or state securities laws; | ||
| willful misconduct or gross negligence by the named executive officer that has or is reasonably likely to have a material adverse effect on Tier; | ||
| a failure of the named executive officer to perform his or her reasonably assigned duties for Tier that has or is reasonably likely to have a material adverse effect on Tier; | ||
| a material violation by the named executive officer of any material provision of our Business Code of Conduct (or successor policies on similar topics) or any other applicable policies in place; |
35
| a violation by the named executive officer of any provision of our Proprietary and Confidential Information, Developments, Noncompetition and Nonsolicitation Agreement with the named executive officers; or | ||
| fraud, embezzlement, theft or dishonesty by the named executive officer against Tier. |
| any reduction in the named executive officers base salary; | ||
| any material diminution of the named executive officers duties, responsibilities, powers or authorities; | ||
| any relocation of his or her principal place of employment by more than 50 miles or requirement that the executive relocate his or her principal place of residence by more than 50 miles; or | ||
| a material breach by Tier of any material provision of the employment agreement. |
Voluntary | ||||||||||||||||||||||||
Involuntary for | Involuntary | termination | ||||||||||||||||||||||
Benefits and payments | Voluntary | cause | not for cause | with good | Death or | Change of | ||||||||||||||||||
upon termination | termination (1) | termination (1) | termination (2) | reason (2) | disability (3) | control (4) | ||||||||||||||||||
Salary
|
$ | 10,769 | $ | 10,769 | $ | 410,769 | $ | 410,769 | $ | 410,769 | $ | 810,769 | ||||||||||||
Bonus
|
166,667 | 166,667 | 949,743 | 949,743 | 558,205 | 783,076 | ||||||||||||||||||
Stock options
(5)
|
579,500 | 579,500 | 579,500 | 579,500 | 579,500 | 579,500 | ||||||||||||||||||
Restricted stock
units
(6)
|
| | | | | | ||||||||||||||||||
Health benefits
|
| | 12,000 | 12,000 | | 12,000 | ||||||||||||||||||
Perquisites
|
| | | | | | ||||||||||||||||||
Accrued PTO
|
(13,729 | ) | (13,729 | ) | (13,729 | ) | (13,729 | ) | (13,729 | ) | (13,729 | ) | ||||||||||||
Total
|
$ | 743,207 | $ | 743,207 | $ | 1,938,283 | $ | 1,938,283 | $ | 1,534,745 | $ | 2,171,616 | ||||||||||||
(1) | Amounts reflect maximum salary earned and prior year bonus accrued but not paid prior to date of termination and personal time off accrued through date of occurrence. | |
(2) | Amounts reflect maximum salary earned and prior year bonus accrued but not yet paid prior to date of termination, one year base salary, bonus equal to average historic bonus prorated for number of months worked prior to occurrence, bonus equal to average historic bonus, immediate vesting of all stock options, restricted stock grants and restricted stock units already issued under Mr. Rossettis Enterprise Value Award, or the EVA plan, twelve months continuation of health benefits and personal time off accrued through September 30, 2008. | |
(3) | Amounts reflect maximum salary earned and prior year bonus accrued but not paid prior to date of termination, one year base salary and bonus equal to average annual bonus paid for the previous three years, or average historic bonus and immediate vesting of all stock options, restricted stock grants, restricted stock units already issued under the EVA plan and personal time off accrued through September 30, 2008. | |
(4) | Amounts reflect two times (a) the base salary plus (b) bonus equal to average historic bonus, immediate vesting of any stock options, restricted stock grants and restricted stock units already issued under the EVA plan, twelve months continuation of health benefits and personal time off accrued through September 30, 2008. | |
(5) | The amount represents the value of vested options as of September 30, 2008 at a closing price of $7.36. | |
(6) | As of September 30, 2008, the target price for the vesting of the restricted stock units had not been met, therefore all units were considered unvested. |
36
Voluntary | ||||||||||||||||||||||||
Involuntary for | Involuntary not | termination | ||||||||||||||||||||||
Benefits and payments upon | Voluntary | cause | for cause | with good | Death or | Change of | ||||||||||||||||||
termination | termination (1) | termination (1) | termination (2) | reason (2) | disability (2) | control (3) | ||||||||||||||||||
Salary
|
$ | 7,404 | $ | 7,404 | $ | 282,404 | $ | 282,404 | $ | 282,404 | $ | 557,404 | ||||||||||||
Bonus
|
68,750 | 68,750 | 68,750 | 68,750 | 68,750 | 68,750 | ||||||||||||||||||
Stock options
(4)
|
| | | | | | ||||||||||||||||||
Health benefits
|
| | 12,000 | 12,000 | 12,000 | 18,000 | ||||||||||||||||||
Perquisites
|
| | | | | | ||||||||||||||||||
Accrued PTO
|
12,684 | 12,684 | 12,684 | 12,684 | 12,684 | 12,684 | ||||||||||||||||||
Total
|
$ | 88,838 | $ | 88,838 | $ | 375,838 | $ | 375,838 | $ | 375,838 | $ | 656,838 | ||||||||||||
(1) | Amounts reflect maximum salary earned but not paid prior to date of termination, accrued prior year bonus not paid prior to date of termination date and personal time off accrued through date of occurrence. | |
(2) | Amounts reflect maximum salary earned but not paid prior to date of termination, accrued prior year bonus not paid prior to date of termination, one year base salary, twelve months continuation of health benefits and personal time off accrued through September 30, 2008. | |
(3) | Amounts reflect maximum salary earned but not paid prior to date of termination, accrued prior year bonus not paid prior to date of termination, two times (a) base salary and (b) bonus equal to average historic bonus, bonus equal to average historic bonus prorated for the number of months worked, immediate vesting of any stock options, eighteen months continuation of health benefits and personal time off accrued through September 30, 2008. | |
(4) | The amount represents the value of vested options as of September 30, 2008 at a closing price of $7.36. |
Voluntary | ||||||||||||||||||||||||
Involuntary for | Involuntary not | termination | ||||||||||||||||||||||
Benefits and payments upon | Voluntary | cause | for cause | with good | Death or | Change of | ||||||||||||||||||
termination | termination (1) | termination (1) | termination (2) | reason (2) | disability (2) | control (3) | ||||||||||||||||||
Salary
|
$ | 6,731 | $ | 6,731 | $ | 256,731 | $ | 256,731 | $ | 256,731 | $ | 506,731 | ||||||||||||
Bonus
|
| | | | | 335,616 | ||||||||||||||||||
Stock options
(4)
|
3,320 | 3,320 | 3,320 | 3,320 | 3,320 | 8,100 | ||||||||||||||||||
Health benefits
|
| | 12,000 | 12,000 | 12,000 | 18,000 | ||||||||||||||||||
Perquisites
|
| | | | | | ||||||||||||||||||
Accrued PTO
|
42,067 | 42,067 | 42,067 | 42,067 | 42,067 | 42,067 | ||||||||||||||||||
Total
|
$ | 52,118 | $ | 52,118 | $ | 314,118 | $ | 314,118 | $ | 314,118 | $ | 910,514 | ||||||||||||
37
(1) | Amounts reflect maximum salary earned but not yet paid prior to date of termination, accrued prior year bonus not yet paid prior to date of termination and personal time off accrued through September 30, 2008. | |
(2) | Amounts reflect maximum salary earned but not yet paid prior to date of termination, accrued prior year bonus not yet paid prior to date of termination, one year base salary, twelve months continued health benefits and personal time off accrued through September 30, 2008. | |
(3) | Mr. Connells change of control amounts reflect maximum salary earned but not yet paid prior to date of termination, accrued prior year bonus not yet paid prior to date of termination, two times (a) base salary and (b) bonus equal to the average bonus paid over the last three years, immediate vesting of options that would have vested within eighteen months of September 30, 2008, eighteen months continued health benefits and personal time off accrued through September 30, 2008. | |
(4) | The amount represents the value of vested options as of September 30, 2008 at a closing price of $7.36. |
Voluntary | ||||||||||||||||||||||||
Involuntary for | Involuntary not | termination | ||||||||||||||||||||||
Benefits and payments upon | Voluntary | cause | for cause | with good | Death or | Change of | ||||||||||||||||||
termination | termination (1) | termination (1) | termination (2) | reason (2) | disability (2) | control (3) | ||||||||||||||||||
Salary
|
$ | 5,115 | $ | 5,115 | $ | 195,115 | $ | 195,115 | $ | 195,115 | $ | 385,115 | ||||||||||||
Bonus
|
| | | | | 67,466 | ||||||||||||||||||
Stock options
(4)
|
1,240 | 1,240 | 1,240 | 1,240 | 1,240 | 1,860 | ||||||||||||||||||
Health benefits
|
| | 12,000 | 12,000 | 12,000 | 18,000 | ||||||||||||||||||
Perquisites
|
| | | | | | ||||||||||||||||||
Accrued PTO
|
17,717 | 17,717 | 17,717 | 17,717 | 17,717 | 17,717 | ||||||||||||||||||
Total
|
$ | 24,072 | $ | 24,072 | $ | 226,072 | $ | 226,072 | $ | 226,072 | $ | 490,158 | ||||||||||||
(1) | Amounts reflect maximum salary earned but not yet paid prior to date of termination, accrued prior year bonus not yet paid prior to date of termination and personal time off accrued through September 30, 2008. | |
(2) | Amounts reflect maximum salary earned but not yet paid prior to date of termination, accrued prior year bonus not yet paid prior to date of termination, one year base salary, twelve months continued health benefits and personal time off accrued through September 30, 2008. | |
(3) | Amounts reflect maximum salary earned but not yet paid prior to date of termination, accrued prior year bonus not yet paid prior to date of termination, two times (a) base salary and (b) bonus equal to the average bonus paid over the preceding three years, immediate vesting of options that would have vested within eighteen months of September 30, 2008, eighteen months continued health benefits and personal time off accrued through September 30, 2008. | |
(4) | The amount represents the value of vested options as of September 30, 2008 at a closing price of $7.36. |
38
39
Fiscal | Effective | |||||||
Pay component | 2008 | October 1, 2008 | ||||||
Board retainer (payable quarterly in arrears)
|
$ | 15,000 | $ | 20,000 | ||||
|
||||||||
Board member fee (per meeting)
|
||||||||
In-person meeting
|
1,000 | 1,000 | ||||||
Telephonic meeting
|
1,000 | 500 | ||||||
|
||||||||
Committee chair retainer (payable quarterly in arrears)
|
||||||||
Audit committee
|
5,000 | 5,000 | ||||||
All other committees
|
| 2,500 | ||||||
|
||||||||
Committee meeting fee (per meeting)
|
||||||||
In-person meeting
|
1,000 | 1,000 | ||||||
Telephonic meeting
|
1,000 | 500 | ||||||
|
||||||||
Lead director retainer (payable quarterly in arrears)
|
5,000 | 5,000 |
| Death and disabilityPro rata vesting; immediate payout | ||
| Voluntary resignationPro rata vesting; payable at end of 3-year vesting period | ||
| Termination for causeForfeit entire award | ||
| Change-in-control100% vesting, payable on date of change-in-control |
40
Fees earned or | Option awards | |||||||||||
Name | paid in cash ($) | ($) (1) (2) | Total ($) | |||||||||
Charles W. Berger
(Chair Audit Committee)
|
$ | 54,000 | $ | 153,497 | $ | 207,497 | ||||||
Samuel Cabot III
(Chair Compensation
Committee and Lead Director)
|
56,000 | 153,497 | 209,497 | |||||||||
John J. Delucca
|
35,750 | 63,326 | 99,076 | |||||||||
Morgan P. Guenther
(Chair Special
Committee for Divestitures and Chair
Governance and Nominating Committee)
|
67,000 | 153,497 | 220,497 | |||||||||
Philip G. Heasley
|
3,750 | 35,422 | 39,172 | |||||||||
T. Michael Scott
(3)
|
21,250 | 90,171 | 111,421 | |||||||||
Bruce R. Spector
(3)
|
21,250 | 90,171 | 111,421 | |||||||||
James R. Stone
(4)
|
31,750 | 63,326 | 95,076 |
(1) | The amounts included in this column reflect the value of option awards that were recognized as an expense for financial statement reporting purposes in fiscal 2008, calculated pursuant to SFAS 123R. Assumptions used in the calculation of these amounts are included in footnote 13 to the audited consolidated financial statements included in our annual report on Form 10-K for the fiscal year ended September 30, 2008. The following table sets forth each option award represented in the column and the amount included for each such award: |
Number of shares | Amount included in | |||||||||
Name | Date of award | underlying options (#) | fiscal 2008 ($) | |||||||
Charles W. Berger
|
08/24/06
02/28/08 |
40,000
20,000 |
* | $ |
90,171
63,326 |
|||||
|
||||||||||
Samuel Cabot III
|
08/24/06
02/28/08 |
40,000
20,000 |
* |
90,171
63,326 |
||||||
|
||||||||||
John J. Delucca
|
02/28/08 | 20,000 | 63,326 | |||||||
|
||||||||||
Morgan P. Guenther
|
08/24/06
02/28/08 |
40,000
20,000 |
* |
90,171
63,326 |
||||||
|
||||||||||
Philip G. Heasley
|
08/01/08 | 10,002 | 35,422 | |||||||
|
||||||||||
T. Michael Scott
|
08/24/06 | 40,000 | * | 90,171 | ||||||
|
||||||||||
Bruce R. Spector
|
08/24/06 | 40,000 | * | 90,171 | ||||||
|
||||||||||
James R. Stone
|
02/28/08 | 20,000 | 63,326 |
* | On August 24, 2006, our non-employee Board members were granted options to purchase 40,000 shares of common stock, which vest as to 20% of the underlying shares granted on the anniversary of the grant date. On December 10, 2007, the Compensation Committee passed a resolution to accelerate the vesting of these options effective December 7, 2007. |
41
(2) | The following table sets forth the outstanding options held by each of our non-employee directors as of September 30, 2008: |
Name | Options outstanding (#) | |||
Charles W. Berger
|
140,000 | |||
Samuel Cabot III
|
200,000 | |||
John J. Delucca
|
40,000 | |||
Morgan P. Guenther
|
150,000 | |||
Philip G. Heasley
|
10,002 | |||
James R. Stone
|
38,337 |
(3) | Mr. Scott and Mr. Spector did not stand for re-election at our 2008 Annual Meeting. | |
(4) | Mr. Stone was a director during fiscal year 2008 but has not been nominated for re-election at our 2009 Annual Meeting. |
2008 | 2007 | |||||||
Audit Fees
(1)
|
$ | 251 | $ | 346 | ||||
Audit Related Fees
(2)
|
272 | 230 | ||||||
Tax Fees
|
| | ||||||
All Other Fees
|
| | ||||||
Total
|
$ | 523 | $ | 576 | ||||
(1) | Represents fees for the audit of our financial statements, review of our quarterly financial statements, and advice on accounting matters directly related to the audit and audit services provided in connection with other statutory and regulatory filings. | |
(2) | Represents fees associated with the audit of our internal controls over financial reporting to comply with Section 404 of the Sarbanes-Oxley Act of 2002. |
42
43
| The rights plan is intended to enhance shareholder value and protect all the companys shareholders from an unfair or coercive offer to acquire the company. | ||
| The bylaw amendment that has been requested would permit the holders of a small minority of Tier stock to impose their own agenda, and the costs and disruptions of a special meeting, on all shareholders. |
44
| An August 2005 study, based upon data from transactions in the period from January 1, 2002 to June 30, 2005, concluded that companies with rights plans on average commanded higher takeover premiums than companies without such plans. | ||
| A 2004 report by the Investor Responsibility Research Center (IRRC) concluded that evidence is increasingly strong that, in general, companies with poison pills receive higher premiums in takeover situations than do those that do not. | ||
| A 1997 study published by Georgeson & Company of takeover premiums during the period from 1992 to 1996 also concluded that premiums paid to acquire target companies with rights plans were higher than premiums paid for target companies that did not have such plans. |
| Each of your directors is elected annually. | ||
| Shareholders may propose business to be conducted at the annual meeting. |
45
| Shareholders may act by written consent at any time. |
| We hold conference calls, which are open to all shareholders, after we file our quarterly and annual reports with the SEC. | ||
| We receive letters from shareholders, and letters raising issues of general concern are promptly forwarded to all of the directors. | ||
| Where appropriate, we take other actions to ensure that shareholders are able to communicate directly with the Board. |
46
|
By Order of the Board of Directors | |||
|
Keith S. Omsberg | |||
|
Secretary | |||
|
||||
|
February XX, 2009 |
47
Name | Business Address | |
Charles W. Berger
|
c/o Tier Technologies, Inc., 10780 Parkridge Blvd., Suite 400, Reston, VA 20191 | |
Samuel Cabot III
|
c/o Tier Technologies, Inc., 10780 Parkridge Blvd., Suite 400, Reston, VA 20191 | |
John J. Delucca
|
c/o Tier Technologies, Inc., 10780 Parkridge Blvd., Suite 400, Reston, VA 20191 | |
Morgan P. Guenther
|
c/o Tier Technologies, Inc., 10780 Parkridge Blvd., Suite 400, Reston, VA 20191 | |
Philip G. Heasley
|
c/o Tier Technologies, Inc., 10780 Parkridge Blvd., Suite 400, Reston, VA 20191 | |
David A. Poe
|
c/o Tier Technologies, Inc., 10780 Parkridge Blvd., Suite 400, Reston, VA 20191 | |
Ronald L. Rossetti
|
c/o Tier Technologies, Inc., 10780 Parkridge Blvd., Suite 400, Reston, VA 20191 | |
James R. Stone
|
c/o Tier Technologies, Inc., 10780 Parkridge Blvd., Suite 400, Reston, VA 20191 |
Name | Principal Occupation | |
Ronald L. Rossetti
|
Chairman and Chief Executive Officer | |
Ronald W. Johnston
|
Chief Financial Officer | |
Nina K. Vellayan
|
Chief Operating Officer | |
Kevin C. Connell
|
Senior Vice President, Sales and Marketing | |
Keith S. Kendrick
|
Senior Vice President, Strategic Marketing | |
Keith S. Omsberg
|
Vice President, General Counsel, and Secretary |
48
Name | Date | Number of Shares | Transaction Type | |||||||||
Charles W. Berger
|
| | | |||||||||
|
||||||||||||
Samuel Cabot III
|
02/27/07 | 5,000 | (1 | ) | ||||||||
|
07/31/07 | 10,000 | (1 | ) | ||||||||
|
||||||||||||
John J. Delucca
|
| | | |||||||||
|
||||||||||||
Morgan P. Guenther
|
| | | |||||||||
|
||||||||||||
Philip G. Heasley
|
| | | |||||||||
|
||||||||||||
David A. Poe
|
| | | |||||||||
|
||||||||||||
Ronald L. Rossetti
|
02/27/07 | 5,000 | (1 | ) | ||||||||
|
07/31/07 | 10,000 | (1 | ) | ||||||||
|
09/05/08 | 2,900 | (2 | ) | ||||||||
|
09/08/08 | 50 | (2 | ) | ||||||||
|
09/09/08 | 1,115 | (2 | ) | ||||||||
|
09/10/08 | 3,000 | (2 | ) | ||||||||
|
09/11/08 | 2,600 | (2 | ) | ||||||||
|
09/12/08 | 2,200 | (2 | ) | ||||||||
|
09/15/08 | 500 | (2 | ) | ||||||||
|
||||||||||||
James R. Stone
|
| | | |||||||||
|
||||||||||||
Ronald W. Johnston
|
| | | |||||||||
|
||||||||||||
Nina K. Vellayan
|
| | | |||||||||
|
||||||||||||
Kevin C. Connell
|
| | | |||||||||
|
||||||||||||
Keith S. Kendrick
|
| | | |||||||||
|
||||||||||||
Keith S. Omsberg
|
| | |
(1) | Acquired Option exercise | |
(2) | Acquired Open market purchase |
49
| upon termination of employment by Tier for disability or termination of employment by death, each of Ms. Vellayan and Mr. Kendrick will be entitled to one times the base salary in effect on the date of termination, payment of any accrued prior year bonus and twelve months continuation of health benefits; | ||
| upon termination of employment by Tier without cause or by the individual with good reason, each of Ms. Vellayan and Mr. Kendrick will be entitled to one times the base salary in effect on the date of termination, payment of any accrued prior year bonus and twelve months continuation of health benefits; and | ||
| upon termination of employment by Tier after a change in control, each of Ms. Vellayan and Mr. Kendrick will be entitled to two times the base salary in effect on the date of termination, two times the average annual bonus paid to the individual, payment of any accrued prior year bonus, immediate vesting of all options or stock awards and eighteen months continuation of health benefits. |
| Nina K. Vellayan, our Chief Operating Officer, is employed pursuant to an employment agreement, which was filed as Exhibit 10.34 to our Annual Report on Form 10-K filed on December 10, 2008; and | ||
| Keith S. Kendrick, our Senior Vice President Strategic Marketing, is employed pursuant to an employment agreement, which was filed as Exhibit 10.2 to a Current Report on Form 8-K filed on July 7, 2008. |
50
51
PRELIMINARY COPY TO SUBMIT YOUR PROXY BY MAIL, PLEASE DETACH PROXY CARD HERE TIER TECHNOLOGIES, INC. PROXY ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON MARCH 11, 2009 THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS |
The undersigned stockholder of Tier Technologies, Inc. hereby constitutes and appoints Ronald W. Johnston and Keith S. Omsberg and each of them, with full power of substitution, as proxy or proxies of the undersigned to vote P the number of shares of common stock which the undersigned would be entitled to vote if personally present at Tiers Annual Meeting of Stockholders, to be held at Tiers headquarters located at 10780 Parkridge Boulevard, R Suite 400, Reston, Virginia, at 10:00 a.m. local time on March 11, 2009, and at any adjournments or postponements thereof, with respect to the proposals described in the Notice of Annual Meeting of Stockholders O and proxy statement, in the manner specified on the reverse side. The proxies are further authorized to vote, in their discretion, upon such other business as may properly come before the meeting or any postponements or X adjournments thereof. |
Y THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AMONG THE BOARDS NOMINEES AS DIRECTED BY THE STOCKHOLDER. WHERE NO CONTRARY DIRECTION IS GIVEN WHEN THE DULY EXECUTED PROXY IS RETURNED, SUCH SHARES WILL BE VOTED CUMULATIVELY IN THE DISCRETION OF THE PROXY HOLDERS AMONG THE BOARDS NOMINEES NAMED IN PROPOSAL NO. 1 (EXCEPT FOR ANY NOMINEES FOR WHOM THE UNDERSIGNED HAS WITHHELD AUTHORITY TO VOTE), FOR PROPOSAL NO. 2, AGAINST PROPOSAL NO. 3, AND AGAINST PROPOSAL NO. 4. |
Cumulative Voting Instructions (Mark the corresponding box on the reverse side) |
Annual Meeting of Stockholders March 11, 2009 10:00 a.m. Local Time Tier Technologies, Inc. Headquarters 10780 Parkridge Blvd., Suite 400 Reston, VA 20191 _ INTERNET _ TELEPHONE Go To 1-866-586-3113 www.proxypush.com/tierOR Use any touch-tone telephone. Submit your proxy online. Have your proxy card ready. Follow the simple recorded instructions. _ MAIL Mark, sign and date your proxy card. OR Detach your proxy card. Return your proxy card in the postage-paid envelope provided. All proxies submitted by mail, internet, or telephone must be received by 11:59 p.m., local time on March 10, 2009. TO SUBMIT YOUR PROXY BY MAIL, PLEASE DETACH PROXY CARD HERE X Please mark votes as in this example. Unless otherwise specified on the reverse side, this proxy THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1 AND 2. authorizes the proxies named on the reverse side to cumulate 1.PROPOSAL NO. 1: votes that the undersigned is entitled to cast at the annual meeting in connection with the election of directors; provided Nominees for Directors for election by the holders of common FOR all nominees listed WITHHOLD that the proxies will not cumulate votes for any nominee from stock:(except as indicated to authority to vote the contrary)for all nominees whom the undersigned has withheld authority to vote. To 01. Charles W. Berger04. Morgan P. Guenther specify different directions with regard to cumulative voting, 02. Samuel Cabot III05. Philip G. Heasley including to direct that the proxy holders cu mulate votes with respect to a specific Board nominee or nominees as 03. John J. Delucca06. David A. Poe explained in the proxy statement, mark the box below and 07. Ronald L. Rossetti write your instructions on the reverse side. (If you wish to direct that the proxy holders cumulate votes with respect to a INSTRUCTIONS: To withhold authority to vote for any individual specific Board nominee or nominees, please indicate the nominee(s), write the name(s) of each nominee(s) in the space name(s) and the number of votes to be given to such Board provided below: nominee(s).) FOR AGAINST ABSTAIN 2.PROPOSAL NO. 2: To ratify the selection of McGladrey & Pullen, LLP as the Companys independent registered public accounting If the undersigned hold(s) any of the shares of common firm for the fiscal year ending September 30, 2009. stock in a fiduciary, custodial, or joint capacity or capacities, this proxy is signed by the undersigned in every such capacity as well as individually. THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST PROPOSALS 3 AND 4. Please sign as name appears on this proxy. Joint 3.PROPOSAL NO. 3: To approve a shareholder proposal regarding FOR AGAINST ABSTAIN owners should each sign. When signing as attorney, as our shareholder rights plan. executor, administrator, trustee, or guardian, please give full title as such. If a corporation, please sign in full 4.PROPOSAL NO. 4: To approve a shareholder proposal regarding FOR AGAINST ABSTAIN corporate name by President or other authorized officer. If a partnership, please sign in partnership name by special meetings. authorized person. Signature [PLEASE SIGN WITHIN BOX]Date Signature [PLEASE SIGN WITHIN BOX]Date 6927 Laurel TIER Proxy new.pdf |
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1 Month Tier Reit Inc. Chart |
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