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Share Name | Share Symbol | Market | Type |
---|---|---|---|
ITT Educational Services Inc (CE) | USOTC:ESINQ | OTCMarkets | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 0.000015 | 0.00 | 01:00:00 |
x
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No fee required.
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¨
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
|
1)
|
Title of each class of securities to which transaction applies:
|
2)
|
Aggregate number of securities to which transaction applies:
|
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):
|
4)
|
Proposed maximum aggregate value of transaction:
|
5)
|
Total fee paid:
|
¨
|
Fee paid previously with preliminary materials.
|
¨
|
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:
|
2)
|
Form, Schedule or Registration Statement No.:
|
3)
|
Filing Party:
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4)
|
Date Filed:
|
1.
|
To consider and vote upon three proposals described in the accompanying Proxy Statement providing for:
|
|
Proposal One
:
|
Election of two Directors to serve until the 2019 Annual Meeting of Shareholders and until their successors are elected and have qualified.
|
|
Proposal Two
:
|
Ratification of the appointment of Deloitte & Touche LLP to serve as ITT/ESI’s independent registered public accounting firm for its fiscal year ending December 31, 2016.
|
|
Proposal Three
:
|
Advisory vote to approve the compensation paid to ITT/ESI’s named executive officers, as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, compensation tables and narrative discussion, in the accompanying Proxy Statement.
|
2.
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To act upon such other matters that may properly come before the meeting.
|
|
Ryan L. Roney
|
|
Executive Vice President, Chief Administrative and Legal Officer and Secretary
|
·
|
election of two directors to serve until the 2019 Annual Meeting of Shareholders and until their successors are elected and have qualified;
|
·
|
ratification of the appointment of Deloitte & Touche LLP (“Deloitte”) to serve as our independent registered public accounting firm for our fiscal year ending December 31, 2016; and
|
·
|
advisory vote to approve the compensation paid to our Named Executive Officers (those executive officers identified in the Compensation Discussion and Analysis below), as disclosed pursuant to the compensation disclosure rules of the U.S. Securities and Exchange Commission (the “SEC”), including the Compensation Discussion and Analysis, compensation tables and narrative discussion, in this Proxy Statement.
|
·
|
the election of directors; and
|
·
|
the approval of the compensation paid to our Named Executive Officers.
|
·
|
delivering to our Secretary an instrument revoking the proxy;
|
·
|
delivering a new proxy in writing, through the Internet or by telephone, dated after the date of the proxy being revoked and, in the case of telephone or Internet voting, before 11:59 p.m., Eastern Time, on May 16, 2016; or
|
·
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attending the Annual Meeting and voting in person (attendance without casting a ballot will not, by itself, constitute revocation of a proxy).
|
·
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FOR the election of the two director nominees named in this Proxy Statement;
|
·
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FOR the ratification of the appointment of Deloitte; and
|
·
|
FOR the approval of the compensation paid to our Named Executive Officers as disclosed in this Proxy Statement.
|
·
|
a phone number where we can reach you with questions;
|
·
|
the address where the ticket should be mailed; and
|
·
|
ownership verification as follows:
|
Shareholders of Record
For ownership verification provide:
|
Beneficial Owners
For ownership verification provide one
of the following:
|
401(k) Holders
For ownership verification provide:
|
||
Option A
• Name(s) of shareholder;
• Address;
• Phone number; and
• Shareholder account number
Option B
• A copy of your proxy card showing
shareholder name and address
|
• A copy of a brokerage account statement showing your share ownership as of the Record Date (3/21/16); or
• A letter from your broker, bank or other nominee verifying your Record Date (3/21/16) ownership; or
• A copy of the voting instruction card you received from your broker, bank or other nominee showing shareholder name and address
|
• Name;
• Address; and
• Phone number
|
·
|
reviewing with our management and our independent registered public accounting firm our risk assessment and risk management, including:
|
·
|
the guidelines and policies governing the process by which management assesses and manages our exposure to risk, and
|
·
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our major financial risk exposures and the steps taken by management to monitor and control those exposures;
|
·
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overseeing our systems of internal controls regarding finance, accounting, legal compliance and ethics;
|
·
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periodically reviewing legal, regulatory and related governmental policy matters; and
|
·
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reviewing management policies and programs relating to our compliance with legal and regulatory requirements, business ethics, business integrity, conflicts of interest and environmental matters.
|
·
|
the integrity of our financial statements and other financial information provided by us to any governmental body or the public;
|
·
|
our compliance with legal and regulatory requirements;
|
·
|
our systems of internal controls regarding finance, accounting, legal compliance and ethics that our management and the Board of Directors establish;
|
·
|
our auditing, accounting and financial reporting processes generally;
|
·
|
the qualifications, independence and performance of our independent registered public accounting firm; and
|
·
|
the performance of our compliance and internal audit functions.
|
·
|
in determining the appropriate objectives and goals of our executive and Director compensation programs;
|
·
|
in designing compensation programs that fulfill those objectives and goals;
|
·
|
regarding the external and internal equity of our executive officers’ total compensation and the primary components of that compensation;
|
·
|
in evaluating the effectiveness of our compensation programs;
|
·
|
in identifying appropriate pay positioning strategies and pay levels in our executive compensation program; and
|
·
|
in identifying comparable companies and compensation surveys for the Compensation Committee to use to benchmark the appropriateness and competitiveness of our executive compensation program.
|
·
|
an officer or employee of ours;
|
·
|
a former officer of ours; or
|
·
|
involved in a relationship requiring disclosure as a related person transaction pursuant to Item 404 of Regulation S-K under the Exchange Act or as an interlocking executive officer/director pursuant to Item 407(e)(4)(iii) of Regulation S-K under the Exchange Act.
|
·
|
assist the Board of Directors by identifying individuals qualified to become Directors, and recommend to the Board of Directors the Director nominees for each annual meeting of shareholders;
|
·
|
develop and recommend to the Board of Directors the Corporate Governance Guidelines applicable to us;
|
·
|
lead the Board of Directors in its annual review of the Board of Directors’ performance; and
|
·
|
recommend to the Board of Directors Board members for each standing Board committee.
|
Audit Committee
|
Jerry M. Cohen, Chair
|
John F. Cozzi
|
Joanna T. Lau
|
Thomas I. Morgan
|
·
|
the assessment of events that could affect the determination of whether we are the primary beneficiary of variable interest entities in which we hold a variable interest;
|
·
|
the assessment of the completeness and accuracy of the data maintained by the servicer of the private education loans that are owned by a variable interest entity that we were required to consolidate;
|
·
|
the review of assumptions and methodologies developed by third-party consultants to project guarantee obligations under a risk sharing agreement entered into by us on February 20, 2009 (the “CUSO RSA”) in connection with a private education loan program; and
|
·
|
the timely identification and communication of information relevant to the private education loan programs to those members of our management who are responsible for its financial reporting processes.
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Deloitte & Touche LLP
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PricewaterhouseCoopers LLP
|
|||||
Type of Service
|
2015
|
2014
|
2014
|
|||
Audit
|
$1,570,000
(1)
|
$2,476,934
(2)
|
$250,000
(3)
|
|||
Audit-Related | $ 63,775 (4) | $ 0 | $ 0 | |||
Tax
|
$ 354,443
(5)
|
$ 0
|
$339,845
(6)
|
|||
All Other
|
$ 0
|
$ 0
|
$ 1,600
(7)
|
|
____________
|
·
|
auditing our annual consolidated financial statements for our 2015 fiscal year;
|
·
|
reviewing our consolidated financial statements included in our Quarterly Reports on Form 10-Q which were filed with the SEC in our 2015 fiscal year;
|
·
|
conducting reviews of our internal control over financial reporting and assisting with requirements related to internal control over financial reporting in 2015;
|
·
|
conducting statutory audits (such as federal and state student financial aid compliance audits) for 2015; and
|
·
|
providing other audit services in connection with statutory and regulatory filings or engagements for our 2015 fiscal year.
|
(2)
|
Represents fees for the following services associated with the audit or review of our financial statements:
|
·
|
auditing our annual consolidated financial statements for our 2014 fiscal year;
|
·
|
reviewing our consolidated financial statements included in our Quarterly Report on Form 10-Q for the third quarter of 2014;
|
·
|
conducting reviews of our internal control over financial reporting and assisting with requirements related to internal control over financial reporting as of December 31, 2014;
|
·
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conducting statutory audits (such as federal and state student financial aid compliance audits) for 2014; and
|
·
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providing other audit services in connection with statutory and regulatory filings or engagements for our 2014 fiscal year.
|
(3)
|
Represents fees for services associated with the review of our consolidated financial statements included in our Quarterly Reports on Form 10-Q for the first and second quarters of 2014.
|
(4)
|
Represents fees for services rendered in the period indicated that were related to the performance of the audit or review of our financial statements and were not reported as Audit services. The nature of those services included, without limitation:
|
·
|
financial statement audits of our employee benefit plans; and
|
·
|
assistance with respect to accounting, financial reporting and disclosure treatment of transactions or events, including:
|
·
|
consultations with us;
|
·
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assistance with understanding and implementing related final and proposed rules, guidance, standards and interpretations from accounting rulemakers, the SEC and the NYSE; and
|
·
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helping us assess the actual or potential impact of final or proposed rules, guidance, standards and interpretations from accounting rulemakers, the SEC and the NYSE.
|
(5)
|
Represents fees for tax services rendered in the period indicated. The nature of those services included, without limitation:
|
·
|
the preparation and review of original and amended income, franchise and other tax returns with respect to federal, state and local tax authorities; and
|
·
|
tax advice and assistance related to statutory, regulatory or administrative developments, tax refund opportunities and transactions.
|
(6)
|
Represents fees for tax services rendered in the period indicated. The nature of those services included, without limitation:
|
·
|
the preparation and/or review of original and amended income, franchise and other tax returns with respect to federal, state and local tax authorities;
|
·
|
assistance with tax audits and appeals before federal, state and local tax authorities; and
|
·
|
tax advice and assistance related to employee benefit plans and statutory, regulatory or administrative developments, and tax credits and refund opportunities.
|
(7)
|
Represents fees for a subscription to PWC’s accounting research tool.
|
·
|
statutory audits (such as federal and state student financial aid compliance audits) or financial audits for our subsidiaries or affiliates;
|
·
|
services associated with SEC registration statements, periodic reports and other documents filed with the SEC or other documents issued in connection with securities offerings; and
|
·
|
consultations with our management concerning accounting, financial reporting or treatment of transactions or events.
|
·
|
due diligence services pertaining to potential business acquisitions or dispositions;
|
·
|
consultations concerning accounting, financial reporting or disclosure treatment of transactions or events not classified as “audit services”;
|
·
|
assistance with understanding and implementing new and proposed accounting and financial reporting guidance from rulemaking authorities;
|
·
|
financial statement audits of employee benefit plans;
|
·
|
assistance with assessing the actual or potential impact of final or proposed rules, standards or interpretations from accounting authorities;
|
·
|
agreed-upon or expanded audit procedures related to accounting and/or billing records required to respond to or comply with financial, accounting or regulatory reporting matters;
|
·
|
attest services not required by statute or regulation;
|
·
|
information systems reviews not performed in connection with the financial statement audit;
|
·
|
subsidiary or equity investee audits not required by statute or regulation that are incremental to the audit of the consolidated financial statements;
|
·
|
review of the effectiveness of the internal audit function;
|
·
|
general assistance with understanding and implementing requirements of SEC rules and stock exchange listing standards; and
|
·
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consultations and audits in connection with acquisitions.
|
Name
|
Age
|
Position
|
||
John E. Dean
|
65
|
Executive Chairman
|
||
Kevin M. Modany
|
49
|
Chief Executive Officer
|
||
Eugene W. Feichtner
|
60
|
President and Chief Operating Officer
|
||
Angela K. Knowlton
|
53
|
Senior Vice President, Controller and Treasurer (Principal Accounting Officer)
|
||
June M. McCormack
|
67
|
Executive Vice President and President,
Online Division
|
||
Ryan L. Roney
|
43
|
Executive Vice President, Chief Administrative and Legal Officer and Secretary
|
||
Glenn E. Tanner
|
68
|
Executive Vice President, Chief Marketing Officer
|
||
Rocco F. Tarasi, III
|
44
|
Executive Vice President, Chief Financial Officer
|
·
|
Kevin M. Modany, who served as our Chief Executive Officer during all of 2015;
|
·
|
Rocco F. Tarasi, III, who has served as our Chief Financial Officer since August 1, 2015;
|
·
|
Daniel M. Fitzpatrick, who served as our Chief Financial Officer during 2015 until July 31, 2015; and
|
·
|
John E. Dean, Eugene W. Feichtner and Ryan L. Roney, who were our three other most highly compensated executive officers during 2015.
|
·
|
the objectives of our compensation program;
|
·
|
what our compensation program is designed to reward;
|
·
|
each element of compensation;
|
·
|
why we choose to pay each compensation element;
|
·
|
how we determine the amount to pay and, where applicable, the formula with respect to each compensation element;
|
·
|
how each compensation element and our decisions regarding that element relate to our overall compensation objectives and affect our decisions regarding other compensation elements; and
|
·
|
our consideration of the results of the most recent shareholder advisory vote on the compensation of our Named Executive Officers and any related effect on our executive compensation policies and decisions.
|
·
|
based in any part, directly or indirectly, on success in enrolling students or the award of financial aid to students; and
|
·
|
provided to any employee who undertakes recruiting or admitting of students, makes decisions about and awards federal student financial aid, or has responsibility for any such activities.
|
·
|
competition;
|
·
|
alignment with shareholder interests; and
|
·
|
focus.
|
·
|
base salary;
|
·
|
short-term compensation;
|
·
|
an annual grant of equity compensation;
|
·
|
employee benefits;
|
·
|
perquisites; and
|
·
|
qualified retirement savings.
|
·
|
Competition
. The Committee believes that compensation should reflect the competitive marketplace in order for us to attract, retain and motivate talented executives.
|
·
|
Alignment with Shareholder Interests
. Compensation should include equity-based compensation awards in order to align the executives’ interests with those of our shareholders.
|
·
|
Focus
. The Committee believes that certain elements of compensation should provide some security to our executives to allow them to continue to focus on our financial and operating results, their individual performance and their job responsibilities.
|
Compensation Element
|
Purpose
|
Link to Compensation Objectives
|
||
Base Salary
|
Fixed cash component used to help us attract, motivate and retain our executives.
|
•Competition
•Focus
|
||
Short-Term Compensation
|
Variable cash component used to help us motivate and retain our executives.
|
•Competition
•Focus
|
||
Equity-Based Compensation (e.g., Time-Based Stock Options and/or Restricted Stock Unit Awards)
|
Used to promote equity ownership by our executives.
Aligns the executives’ interests with those of our shareholders.
|
•Competition
•Alignment with Shareholder Interests
•Focus
|
Qualified Retirement Savings (i.e., 401(k) Plan Contributions)
|
Used to help us provide stable compensation and some security to our executives, in order to help them save for retirement on a tax-deferred basis.
|
•Competition
•Focus
|
|||
Nonqualified Deferred Compensation
|
Provided some security to our executives and helped them save a portion of their compensation for retirement on a tax-deferred basis.
|
•Deferrals and contributions are no longer made under
these plans.
|
|||
Pension Benefits (i.e., Qualified and Nonqualified Retirement Plan Earnings)
|
Allowed executives to focus on their job responsibilities while employed and provided some security upon retirement.
|
•Benefit accruals under our pension plans were frozen as of
March 31, 2006.
|
|||
|
|||||
Employee Benefits
|
Provides stable compensation and some security to our executives, in order to allow them to focus on their job responsibilities.
|
•Competition
•Focus
|
|||
Perquisites |
Used to recognize our executives based on their responsibilities and to help us attract, motivate and retain our executives.
|
•Competition
|
|||
Potential Payments Upon Termination of Employment or a Change in Control of Us |
Provides for payments in connection with a change in control and/or involuntary termination of employment.
Provides some security to our executives to help them focus on their job responsibilities and to encourage them to remain employed with us during a critical time of a potential change in control.
|
•Competition
•Alignment with Shareholder Interests
•Focus
|
Management Objectives
|
Weight
|
|||
1.
|
Resolve certain outstanding legal and regulatory matters involving the company.
|
20%
|
||
2.
|
Optimize the total number of contact hours in the first academic quarter of the ITT Technical Institutes’ program offerings.
|
20%
|
||
3.
|
Effect matters relating to the third-party loan servicing organizations for the private education loan programs.
|
15%
|
||
4.
|
Improve the 2015 ITT Technical Institute quarterly student evaluation average score.
|
15%
|
||
5.
|
Reduce the current and future carrying cost and collateralization of the letter of credit that the company is required to post for the benefit of the U.S. Department of Education.
|
10%
|
||
6.
|
Improve the average NCLEX score of the 2015 graduates of the Breckinridge School of Nursing and Health Sciences nursing program.
|
10%
|
||
7.
|
Acquire a training company to support strategic initiatives associated with The Center for Professional Development at ITT Technical Institute.
|
5%
|
||
8.
|
Obtain requisite federal, state and accrediting commission authorizations for the ITT Technical Institutes to offer a dual high school diploma and associate degree program.
|
5%
|
Total Weighted Points
|
Maximum Short-Term
Compensation Percentage
|
|
4.76 - 5.00
|
200.0%
|
|
4.51 - 4.75
|
187.5%
|
|
4.26 - 4.50
|
175.0%
|
|
4.01 - 4.25
|
162.5%
|
|
3.76 - 4.00
|
150.0%
|
|
3.51 - 3.75
|
137.5%
|
|
3.26 - 3.50
|
125.0%
|
|
3.01 - 3.25
|
112.5%
|
|
2.76 - 3.00
|
100.0%
|
|
2.51 - 2.75
|
87.5%
|
|
2.26 - 2.50
|
75.0%
|
|
2.01 - 2.25
|
62.5%
|
|
1.76 - 2.00
|
50.0%
|
|
1.51 - 1.75
|
41.7%
|
|
1.26 - 1.50
|
33.3%
|
|
1.00 - 1.25
|
25.0%
|
Named Executive Officer
|
2015 Standard Short-
Term Compensation
Percentage of
Annualized Base Salary
|
|
Kevin M. Modany
|
100%
|
|
Rocco F. Tarasi, III
|
50/65%
(1)
|
|
Daniel M. Fitzpatrick
|
65%
|
|
Eugene W. Feichtner
|
70%
(2)
|
|
Ryan L. Roney
|
65%
|
(1)
|
Mr. Tarasi’s standard short-term compensation percentage was 50% with respect to the seven months of 2015 that he served as our Senior Vice President, President – The Center for Professional Development, and was 65% with respect to the five months of 2015 that he served as our Executive Vice President, Interim Chief Financial Officer. The 2015 short-term compensation payment to Mr. Tarasi, as set forth below, reflected the use of these two standard short-term compensation percentages as applicable.
|
(2)
|
Reflects an increase from the prior year, due to Mr. Feichtner’s appointment as our President and Chief Operating Officer in August 2014.
|
Named Executive Officer
|
2015 Short-Term
Compensation Payment
|
2015 Short-Term Compensation
Payment as a Percentage of
2015 Annualized Base Salary
|
||
Kevin M. Modany
|
$515,048
|
62.5%
|
||
Rocco F. Tarasi, III
|
$ 77,854
|
35.2%
|
||
Daniel M. Fitzpatrick
|
$112,348
(1)
|
27.3%
|
||
Eugene W. Feichtner
|
$174,999
|
43.7%
|
||
Ryan L. Roney
|
$146,250
|
40.6%
|
(1)
|
Pro-rated payment amount based on the period of Mr. Fitzpatrick’s service as an employee in 2015, as described above.
|
|
Stock Options
|
RSUs
|
||||||||||
Named Executive Officer
|
Number of
Securities
Underlying
Option
Granted
|
Exercise
Price
|
Expiration
Date
|
Number
of RSUs
|
Grant
Date
(1)
|
Date
Compensation
Committee
Took Action
|
||||||
Rocco F. Tarasi, III
|
5,000
(2)
|
$4.91
|
06/17/22
|
2,250
(3)
|
06/17/15
|
01/26/15
(4)
|
||||||
Rocco F. Tarasi, III
|
N/A
|
N/A
|
N/A
|
16,667
(5)
|
08/06/15
|
07/27/15
(6)
|
||||||
Daniel M. Fitzpatrick
|
15,000
(2)
|
$4.91
|
06/17/22
|
6,750
(3)
|
06/17/15
|
01/26/15
(4)
|
||||||
Eugene W. Feichtner
|
17,500
(2)
|
$4.91
|
06/17/22
|
7,875
(3)
|
06/17/15
|
01/26/15
(4)
|
||||||
Ryan L. Roney
|
12,500
(2)
|
$4.91
|
06/17/22
|
5,625
(3)
|
06/17/15
|
01/26/15
(4)
|
||||||
Ryan L. Roney
|
5,208
(7)
|
$4.91
|
06/17/22
|
2,344
(8)
|
06/17/15
|
07/21/14
(9)
|
|
_____________
|
|
(1)
|
The effective date of the stock option and RSU grants.
|
|
(2)
|
Nonqualified stock option granted at 100% of the closing market price of a share of our common stock on June 17, 2015, the effective date of the grant. One-third of the option is exercisable on each of February 9, 2016, February 9, 2017 and February 9, 2018.
|
|
(3)
|
The period of restriction for this RSU grant lapses in thirds on each of February 9, 2016, February 9, 2017 and February 9, 2018.
|
|
(4)
|
These stock option and RSU grants were initially approved by the Compensation Committee during a Committee meeting on January 26, 2015, their vesting commencement date was approved by the Compensation Committee during a Committee meeting on May 20, 2015, and they had an effective grant date of June 17, 2015.
|
|
(5)
|
The period of restriction for this RSU grant lapses in thirds on each of August 6, 2016, 2017 and 2018.
|
|
(6)
|
This RSU grant was approved by the Compensation Committee during a Committee meeting on July 27, 2015.
|
|
(7)
|
Nonqualified stock option granted at 100% of the closing market price of a share of our common stock on June 17, 2015, the effective date of the grant. One-third of the option is exercisable on each of July 7, 2015, July 7, 2016 and July 7, 2017.
|
|
(8)
|
The period of restriction for this RSU grant lapses in thirds on each of July 7, 2015, July 7, 2016 and July 7, 2017.
|
|
(9)
|
These stock option and RSU grants were initially approved by the Compensation Committee during a Committee meeting on July 21, 2014, their vesting commencement date was approved by the Committee during a Committee meeting on May 20, 2015, and they and had an effective grant date of June 17, 2015.
|
Named Executive Officer
|
2016 Annualized
Base Salary
|
Dollar
Increase/
(Decrease)
From
Prior Year
|
Percentage
Increase/
(Decrease) From
Prior Year
|
|||
Kevin M. Modany
|
$824,076
|
$ 0
|
0%
|
|||
Rocco F. Tarasi, III
|
$350,000
|
$ 128,550
|
58.0%
|
|||
John E. Dean
|
$200,000
|
$(375,000)
|
(65.2)%
|
|||
Eugene W. Feichtner
|
$400,000
|
$ 0
|
0%
|
|||
Ryan L. Roney
|
$360,000
|
$ 0
|
0%
|
Management Objectives
|
Weight
|
|
1. Resolve (through settlement or otherwise) outstanding legal and regulatory matters involving the company
|
20%
|
|
2. Increase the 2016 weighted average graduation rate for ITT Technical Institute (calculated utilizing a completion period equal to 1.5 times the anticipated program duration for a full-time student)
|
20%
|
|
3. Improve the 2016 ITT Technical Institute quarterly student evaluation average score
|
10%
|
|
4. Improve the average NCLEX score of the 2016 graduates of the Breckinridge School of Nursing and Health Sciences nursing program
|
10%
|
|
5. Establish relationships with Corporate Partners to deliver customized corporate training and other educational services
|
10%
|
|
6. Design, develop and obtain the necessary regulatory authorizations to offer an alternative delivery methodology for an accredited degree program
|
10%
|
|
7. Design, develop and implement a revised marketing and advertising campaign for ITT Technical Institute
|
10%
|
|
8. Obtain the requisite federal, state and accrediting commission authorizations for the ITT Technical Institutes to offer new diploma and/or degree programs
|
5%
|
|
9. Obtain the requisite federal, state and accrediting commission authorizations for the ITT Technical Institutes to open new campus locations
|
5%
|
Total Weighted Points
|
Maximum Short-Term
Compensation Percentage
|
|
4.76 - 5.00
|
200.0%
|
|
4.51 - 4.75
|
187.5%
|
|
4.26 - 4.50
|
175.0%
|
|
4.01 - 4.25
|
162.5%
|
|
3.76 - 4.00
|
150.0%
|
|
3.51 - 3.75
|
137.5%
|
|
3.26 - 3.50
|
125.0%
|
|
3.01 - 3.25
|
112.5%
|
|
2.76 - 3.00
|
100.0%
|
|
2.51 - 2.75
|
87.5%
|
|
2.26 - 2.50
|
75.0%
|
|
2.01 - 2.25
|
62.5%
|
|
1.76 - 2.00
|
50.0%
|
|
1.51 - 1.75
|
41.7%
|
|
1.26 - 1.50
|
33.3%
|
|
1.00 - 1.25
|
25.0%
|
Named Executive Officer
|
2016 Standard Short-
Term Compensation
Percentage of
Annualized Base Salary
|
|
Kevin M. Modany
|
100%
|
|
Rocco F. Tarasi, III
|
65%
|
|
Eugene W. Feichtner
|
70%
|
|
Ryan L. Roney
|
65%
|
|
Stock Options
|
RSUs
|
||||||||||
Named Executive Officer
|
Number of
Securities
Underlying
Option
Granted
|
Exercise
Price
|
Expiration
Date
|
Number
of RSUs
|
Grant
Date
(1)
|
Date
Compensation
Committee
Took Action
(2)
|
||||||
Kevin M. Modany
|
62,500
(3)
|
$3.57
|
3/18/23
|
42,188
(4)
|
3/18/16
|
01/25/16
|
||||||
Rocco F. Tarasi, III
|
15,000
(3)
|
$3.57
|
3/18/23
|
10,125
(4)
|
3/18/16
|
01/25/16
|
||||||
Eugene W. Feichtner
|
17,500
(3)
|
$3.57
|
3/18/23
|
11,813
(4)
|
3/18/16
|
01/25/16
|
||||||
Ryan L. Roney
|
12,500
(3)
|
$3.57
|
3/18/23
|
8,438
(4)
|
3/18/16
|
01/25/16
|
|
_____________
|
(1)
|
The effective date of the stock option and RSU grants.
|
(2)
|
The stock option and RSU grants were approved by the Compensation Committee during a Committee meeting on January 25, 2016, and had an effective grant date of March 18, 2016.
|
(3)
|
Nonqualified stock option granted at 100% of the closing market price of a share of our common stock on March 18, 2016, the effective date of the grant. One-third of the option is exercisable on the anniversary date of the grant in each of the years 2017, 2018 and 2019.
|
(4)
|
The period of restriction for this RSU grant lapses in thirds on the anniversary date of the grant in each of the years 2017, 2018 and 2019.
|
·
|
we terminate the executive’s employment, other than for cause, or when the executive terminates his or her employment for good reason, in each case within two years after the occurrence of a change in control of us; or
|
·
|
we terminate the executive’s employment, other than for cause, if a change in control of us is imminent.
|
·
|
provides employees with the same opportunities as shareholders, who are free to sell their equity at the time of the change in control event and thereby realize the value created at the time of the transaction;
|
·
|
ensures that employees do not have the fate of their outstanding equity tied to the future success of the new and different company that results from the change in control;
|
·
|
can be a strong retention device during change in control discussions, particularly for those employees whose equity represents a significant portion of their total pay package; and
|
·
|
treats all employees the same regardless of their employment status after the transaction.
|
·
|
the high level of responsibility that he has with us;
|
·
|
the substantial duties and responsibilities that he has to us; and
|
·
|
the fact that the market and comparator compensation information demonstrates higher levels of compensation for chief executive officers both within and outside of our industry.
|
·
|
the level and area of job responsibilities of the executive;
|
·
|
inflationary factors; and
|
·
|
tenure and industry knowledge and experience.
|
·
|
the Compensation Committee has typically made grants to our executives and other key employees annually during its first regularly scheduled meeting of the calendar year, which grants become effective prospectively;
|
·
|
the Compensation Committee has typically made grants to our newly-hired executives at the Senior Vice President level and above at a Committee meeting occurring either:
|
·
|
prior to the date that the executive’s employment with us begins, in which case the effective date of the grant is typically the executive’s first day of employment with us but, if the markets are closed on that day, is the next subsequent day that the markets are open; or
|
·
|
after the executive’s employment with us begins, in which case the effective date of the grant is the date of the Committee meeting or a subsequent date specified by the Committee at its meeting; and
|
·
|
pursuant to authority delegated to him by the Compensation Committee, our Chief Executive Officer typically grants equity-based compensation to our newly-hired executives below the Senior Vice President level and other key employees on the newly-hired employee’s first day of employment with us.
|
·
|
the cash portion of the compensation of our executives to the median of the range of the cash compensation provided to executives of comparator companies, based on the dollar amount of such compensation; and
|
·
|
the equity-based compensation of our executives not to exceed the upper quarter of the range of equity-based compensation provided to executives of comparator companies, based on the number of shares awarded as a percentage of the number of shares outstanding.
|
·
|
U.S.-based companies that either compete with our company for market share or operate in similar industries as our company;
|
·
|
competitors for senior executive talent;
|
·
|
revenue and market capitalization; and
|
·
|
the peer groups used by others.
|
Compensation Committee
|
C. David Brown
|
John F. Cozzi
|
Thomas I. Morgan, Chair
|
Samuel L. Odle
|
·
|
We have established internal controls, enterprise risk management and a compliance program to discourage and identify any excessive risk-taking by our employees.
|
·
|
There is a balanced mix of cash, equity, annual and longer-term components in the compensation program for our executives.
|
·
|
While our short-term compensation element is based on certain management objectives for a particular year:
|
·
|
the maximum short-term compensation percentage is capped at 200% of the standard short-term percentage of our executives’ annualized base salary, to protect against disproportionately large shorter-term incentives;
|
·
|
the Compensation Committee has substantial discretion on which to base the actual amount of the short-term compensation payments, including the ability to consider and reduce a payment amount if the Committee determines that an executive caused us to incur unnecessary or excessive risk;
|
·
|
the management objectives include many different business objectives that are company-wide objectives, as opposed to individual objectives, which encourage decision-making that is in the best long-term interests of our company and shareholders; and
|
·
|
the management objectives are not unreasonable or clearly unattainable without excessive risk-taking.
|
·
|
A significant portion of our executives’ total compensation consists of equity-based long-term awards, most of which vest over a period of three years, which encourages our executives to focus on sustaining our long-term interests. The equity grants are also made annually, so executives always have unvested awards that could decrease in value if our business is not managed for the long term.
|
·
|
Some of our non-executive employees are eligible to receive equity awards. For those non-executive employees who are eligible to receive equity awards, the equity awards encourage those employees to focus on our long-term interests.
|
Name and
Principal Position
|
Year
|
Salary
(1)
|
Bonus
(2)
|
Stock
Awards
(3)
|
Option
Awards
(4)
|
Non-Equity
Incentive Plan
Compensation
(5)
|
Change in Pension
Value and Non-
qualified Deferred
Compensation
Earnings
(6)
|
All Other
Compensation
(7)
|
Total
(8)
|
|||||||||
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
(i)
|
(j)
|
|||||||||
Kevin M. Modany
Chief Executive Officer
|
2015
|
$824,076
|
$ 0
|
$ 0
|
$ 0
|
$ 515,048
|
$ 5,022
|
$ 35,199
|
$1,379,345
|
|||||||||
2014
|
$821,380
|
$ 0
|
$ 785,813
|
$788,750
|
$ 721,067
|
$11,908
|
$ 65,714
|
$3,194,632
|
||||||||||
2013
|
$798,596
|
$ 0
|
$ 543,094
|
$572,500
|
$1,000,093
|
$ 3,011
|
$ 55,333
|
$2,972,627
|
||||||||||
Rocco F. Tarasi, III
(9)
Executive Vice President, Chief Financial Officer
|
2015
|
$221,450
|
$ 0
|
$ 61,049
|
$ 18,250
|
$ 77,854
|
$ 0
|
$ 10,591
|
$ 389,194
|
|||||||||
2014
|
$220,725
|
$ 0
|
$ 62,865
|
$ 63,100
|
$ 96,884
|
$ 0
|
$ 14,331
|
$ 457,905
|
||||||||||
2013
|
$210,219
|
$ 0
|
$ 43,448
|
$ 45,800
|
$ 134,375
|
$ 0
|
$ 12,610
|
$ 446,452
|
||||||||||
Daniel M. Fitzpatrick
Former Executive Vice President, Chief Financial Officer
|
2015
|
$276,548
|
$ 0
|
$ 33,143
|
$ 54,750
|
$ 112,348
|
$ 0
|
$226,230
|
$ 703,019
|
|||||||||
2014
|
$410,652
|
$100,000
|
$ 188,595
|
$189,300
|
$ 234,325
|
$ 0
|
$ 13,792
|
$1,136,664
|
||||||||||
2013
|
$391,915
|
$ 0
|
$ 130,343
|
$137,400
|
$ 325,000
|
$ 0
|
$ 19,468
|
$1,004,126
|
||||||||||
John E. Dean
(10)
Executive Chairman
|
2015
|
$575,000
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
$ 5,971
|
$ 580,971
|
|||||||||
2014
|
$309,726
|
$ 0
|
$1,000,002
|
$ 0
|
$ 0
|
$ 0
|
$ 221
|
$1,309,949
|
||||||||||
Eugene W. Feichtner
President and Chief Operating Officer
|
2015
|
$391,168
|
$ 0
|
$ 38,666
|
$ 63,875
|
$ 174,999
|
$ 9,009
|
$ 12,111
|
$ 689,828
|
|||||||||
2014
|
$318,366
|
$ 0
|
$ 125,730
|
$126,200
|
$ 245,000
|
$93,530
|
$ 11,088
|
$ 919,914
|
||||||||||
2013
|
$309,535
|
$ 0
|
$ 86,895
|
$ 91,600
|
$ 232,581
|
$ 214
|
$ 10,949
|
$ 731,774
|
||||||||||
Ryan L. Roney
(11)
Executive Vice President, Chief Administrative and Legal Officer
|
2015
|
$360,000
|
$ 0
|
$ 39,128
|
$ 64,634
|
$ 146,250
|
$ 0
|
$ 69,308
|
$ 679,320
|
|||||||||
2014
|
$174,575
|
$ 0
|
$ 0
|
$ 0
|
$ 102,375
|
$ 0
|
$ 70,479
|
$ 347,429
|
||||||||||
(1)
|
Amounts shown represent the dollar value of base salary earned during each of the years indicated. For Mr. Dean, the amount shown for 2014 consists of: (i) $75,000, which is the dollar value of the annual retainer that he received in early 2014 as a non-employee Director of ours in 2014; and (ii) $234,726, which is the base salary that he earned in 2014 following his appointment as the Executive Chairman of the Board on August 4, 2014. Mr. Dean elected to receive payment of his annual retainer in shares of our common stock, and to defer receipt of those shares, pursuant to the ESI Non-Employee Directors Deferred Compensation Plan (the “Directors Deferred Compensation Plan”). See “—Director Compensation—
Directors Deferred Compensation Plan
.”
|
(2)
|
Amounts shown represent the dollar value of discretionary bonus amounts earned in the stated year. Under Item 402(a) of Regulation S-K under the Exchange Act, any bonus award that is paid above the amounts earned by the Named Executive Officer under, or that is otherwise paid to the Named Executive Officer without regard to, pre-established targets is to be reported in this column. The amounts earned under pre-established targets are reported in column (g), “Non-Equity Incentive Plan Compensation,” of the Summary Compensation Table. The amount shown for Mr. Fitzpatrick in 2014 represents a discretionary bonus payment made to him in recognition of his significant efforts and time spent on company matters in 2014, which was in addition to the amount paid to him under the short-term compensation element of the executive compensation program for 2014, shown in the “Non-Equity Incentive Plan Compensation” column.
|
(3)
|
Amounts shown represent the aggregate grant date fair value, computed in accordance with ASC 718, of all awards of RSUs granted to the Named Executive Officer in the year indicated. To determine the grant date fair value of RSU awards, we use the closing market price of a share of our common stock on the effective date of the RSU award. The amounts ultimately realized by the Named Executive Officers from the RSU awards will depend on the price of our common stock in the future and may be quite different from the values shown. For Mr. Dean, the amount shown includes the aggregate grant date fair value of the award of RSUs granted to him on August 4, 2014, but does not include the amount of the 2014 Director annual retainer paid in early 2014 that Mr. Dean elected to receive in the form of shares of our common stock. That amount is included in column (c) of the table, and the fair value of such common stock was $74,984.
|
(4)
|
Amounts shown represent the aggregate grant date fair value, computed in accordance with ASC 718, of all awards of stock options granted to the Named Executive Officer in the year indicated. The option awards relate solely to shares of our common stock. None of the Named Executive Officers has received any stock appreciation rights (“SARs”) from us. We did not adjust or amend the exercise price of any options previously awarded to any of the Named Executive Officers, whether through amendment, cancellation or replacement grants, or any other means (such as a repricing), or otherwise materially modify such awards, during any of the years indicated. We used a binomial option pricing model to determine the grant date fair value of the stock options granted in each of the years indicated, which takes into account the variables defined below:
|
·
|
“Volatility” is a statistical measure of the extent to which the stock price is expected to fluctuate during a period and combines our historical stock price volatility and the implied volatility as measured by actively traded stock options.
|
·
|
“Expected life” is the weighted average period that those stock options are expected to remain outstanding, based on the historical patterns of our stock option exercises, as adjusted to reflect the current position-level demographics of the stock option grantees.
|
·
|
“Risk-free interest rate” is based on interest rates for terms that are similar to the expected life of the stock options.
|
·
|
“Dividend yield” is based on our historical and expected future dividend payment practices.
|
Assumptions Associated with
Stock Options Granted In
|
|||||
2015
|
2014
|
2013
|
|||
Volatility
|
107%
|
55%
|
60%
|
||
Expected life (in years)
|
4.7
|
4.7
|
4.6
|
||
Risk-free interest rate
|
1.6%
|
1.3%
|
0.7%
|
||
Dividend yield
|
None
|
None
|
None
|
(5)
|
Amounts shown represent the dollar value of all amounts earned for services performed during each of the years indicated pursuant to awards under non-equity incentive plans. There were no earnings on any outstanding non-equity incentive plan awards during any of the years indicated. The amounts reported in this column consist of amounts earned under the short-term compensation element of our executive compensation, based on the management objectives for that year, and paid in the following year. Under Item 402(a) of Regulation S-K under the Exchange Act, our short-term compensation element is defined to be non-equity incentive plan compensation, instead of bonus compensation, to the extent that the outcome with respect to the relevant targets under our management objectives was substantially uncertain at the time the targets were established by the Compensation Committee and communicated to the participants. As a result, our short-term compensation element is intended to serve as an incentive to obtain results over a specified fiscal year, which caused it to be reported in this column. Due to changes in positions or contemplated positions in 2015, certain modifications were made during 2015 related to the short-term compensation element for Messrs. Modany, Tarasi and Fitzpatrick, as described in “– Compensation Discussion and Analysis –
Compensation Elements –
2015 Compensation
–
Short-Term Compensation
.” Those modifications were made at a time when the outcomes related to the 2015 Management Objectives were still substantially uncertain. No changes were made to the 2015 Management Objectives applicable to any of the Named Executive Officers. The amount shown in 2014 for Mr. Feichtner was based on his base salary rate as of February 9, 2015, instead of December 31, 2014 as initially contemplated, due to the fact that his base salary increase in connection with his appointment as our President and Chief Operating Officer in August 2014 was only delayed to February 2015 instead of being effective in August 2014 as a result of the Incentive Compensation Prohibition related to the number of permitted salary increases in a year. No changes were made to the 2014 Management Objectives applicable to Mr. Feichtner or any other Named Executive Officer. Amounts shown in this column include any portion of the award that may have been deferred by the Named Executive Officers under the Deferred Bonus Plan. See “– Nonqualified Deferred Compensation Plans –
Deferred Bonus Plan
.”
|
(6)
|
Amounts shown consist of:
|
·
|
the aggregate change in actuarial present value of the Named Executive Officer’s accumulated benefit on an annualized basis under all defined benefit and actuarial pension plans (including supplemental plans) from December 31 of the prior completed fiscal year to December 31 of the covered fiscal year, except that with respect to the 2013 aggregate change in actuarial present value for all Named Executive Officer participants, that aggregate change was a negative number (see table below), and therefore in accordance with the SEC rule, that negative change is not included in the amount reported in this column or in the “Total” column; and
|
·
|
the above-market or preferential earnings on compensation that is deferred on a basis that is not tax-qualified, including such earnings on nonqualified defined contribution plans.
|
·
|
the Retirement Plan for Salaried Employees of ITT Corporation (the “Old Pension Plan”), a non-contributory defined benefit pension plan;
|
·
|
the ESI Pension Plan, a cash balance defined benefit plan; and
|
·
|
the ESI Excess Pension Plan, an unfunded, nonqualified retirement plan.
|
Named Executive Officer
|
Old Pension Plan
Aggregate Change
in Present Value of
Accumulated Benefit
|
ESI Pension Plan
Aggregate Change
in Present Value of
Accumulated Benefit
|
ESI Excess
Pension Plan
Aggregate Change
in Present Value of
Accumulated Benefit
|
Total
|
||||
Kevin M. Modany
|
||||||||
2015
|
$ 0
|
$ 686
|
$ 885
|
$ 1,571
|
||||
2014
|
$ 0
|
$ 4,024
|
$ 5,188
|
$ 9,212
|
||||
2013
|
$ 0
|
$(1,612)
|
$(2,078)
|
$ (3,690)
|
||||
Rocco F. Tarasi, III
|
||||||||
2015
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
||||
2014
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
||||
2013
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
||||
Daniel M. Fitzpatrick
|
||||||||
2015
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
||||
2014
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
||||
2013
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
||||
John E. Dean
|
||||||||
2015
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
||||
2014
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
||||
Eugene W. Feichtner
|
||||||||
2015
|
$ (7,227)
|
$12,862
|
$ 3,129
|
$ 8,764
|
||||
2014
|
$ 78,018
|
$12,312
|
$ 3,008
|
$ 93,338
|
||||
2013
|
$(36,285)
|
$11,788
|
$ 2,893
|
$(21,604)
|
||||
Ryan L. Roney
|
||||||||
2015
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
||||
2014
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
|
In addition, the above-market or preferential earnings on compensation that is deferred on a basis that is not tax-qualified for the benefit of the Named Executive Officers under the ESI Excess Savings Plan, an unfunded, nonqualified retirement plan are specified in the table below. There were no above-market or preferential earnings on compensation that is deferred on a basis that is not tax-qualified for the benefit of the Named Executive Officers under the Deferred Bonus Plan, an unfunded, nonqualified deferred compensation plan, in 2015, 2014 or 2013. See “– Nonqualified Deferred Compensation Plans.”
|
Named Executive Officer
|
ESI Excess Savings Plan
Above-Market or
Preferential Earnings on
Deferred Compensation
(A)
|
|
Kevin M. Modany
|
||
2015
|
$3,451
|
|
2014
|
$2,696
|
|
2013
|
$3,011
|
|
Rocco F. Tarasi, III
|
||
2015
|
$ 0
|
|
2014
|
$ 0
|
|
2013
|
$ 0
|
|
Daniel M. Fitzpatrick
|
||
2015
|
$ 0
|
|
2014
|
$ 0
|
|
2013
|
$ 0
|
|
John E. Dean
|
||
2015
|
$ 0
|
|
2014
|
$ 0
|
|
Eugene W. Feichtner
|
||
2015
|
$ 245
|
|
2014
|
$ 192
|
|
2013
|
$ 214
|
|
Ryan L. Roney
|
||
2015
|
$ 0
|
|
2014
|
$ 0
|
|
_____________
|
|
(A)
|
Interest is above-market only if the rate of interest exceeds 120% of the applicable federal long-term rate, with compounding (as prescribed under Section 1274(d) of the IRC), at the rate that corresponds most closely to the rate under the applicable plan at the time the interest rate or formula is set. In the event of a discretionary reset of the interest rate, the requisite calculation is made on the basis of the interest rate at the time of such reset, rather than when originally established. Only the above-market portion of the interest is included.
|
(7)
|
Amounts shown represent all other compensation for each of the years indicated that could not properly be reported in columns (c) through (h) of the Summary Compensation Table, as follows:
|
Perquisites
(A)
|
||||||||||||||||
Named
Executive Officer
|
Use of a
Company
Car
(B)
|
Tax Return
and Financial
Planning
Allowance
(C)
|
Event
Tickets
(D)
|
Enhanced
Disability
Benefits
(E)
|
Annual
Physical
Examination
(F)
|
Relocation
Assistance
(G)
|
Legal
Expenses
(H)
|
Perquisites
Total
|
||||||||
Kevin M. Modany
|
||||||||||||||||
2015
|
$11,256
|
$14,538
|
$ 0
|
$3,296
|
$1,591
|
$ 0
|
$ 0
|
$30,681
|
||||||||
2014
|
$13,915
|
$14,686
|
$3,511
|
$6,593
|
$ 2,801
|
$ 0
|
$18,475
|
$59,981
|
||||||||
2013
|
$25,261
|
$ 6,331
|
$6,487
|
$6,422
|
$3,182
|
$ 0
|
$ 0
|
$47,683
|
||||||||
Rocco F. Tarasi, III
|
||||||||||||||||
2015
|
$ 0
|
$ ,214
|
$ 757
|
$1,772
|
$1,330
|
$ 0
|
$ 0
|
$ 6,073
|
||||||||
2014
|
$ 0
|
$ 2,214
|
$2,426
|
$1,772
|
$1,330
|
$ 0
|
$ 0
|
$ 7,742
|
||||||||
2013
|
$ 0
|
$ 0
|
$2,883
|
$1,772
|
$1,686
|
$ 0
|
$ 0
|
$ 6,341
|
||||||||
Daniel M. Fitzpatrick
|
||||||||||||||||
2015
|
$ 0
|
$ 4,120
|
$1,310
|
$1,648
|
$ 0
|
$ 0
|
$26,500
|
$33,578
|
||||||||
2014
|
$ 0
|
$ 4,120
|
$ 643
|
$3,296
|
$ 0
|
$ 0
|
$ 0
|
$ 8,059
|
||||||||
2013
|
$ 0
|
$ 4,000
|
$2,056
|
$3,222
|
$2,540
|
$ 0
|
$ 0
|
$11,818
|
||||||||
John E. Dean
|
||||||||||||||||
2015
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
||||||||
2014
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
$ 0
|
||||||||
Eugene W. Feichtner
|
||||||||||||||||
2015
|
$ 0
|
$ 4,000
|
$ 0
|
$2,555
|
$ 0
|
$ 0
|
$ 0
|
$ 6,555
|
||||||||
2014
|
$ 0
|
$ 3,194
|
$ 0
|
$2,555
|
$ 0
|
$ 0
|
$ 0
|
$ 5,749
|
||||||||
2013
|
$ 0
|
$ 3,101
|
$ 0
|
$2,502
|
$ 0
|
$ 0
|
$ 0
|
$ 5,603
|
||||||||
Ryan L. Roney
|
||||||||||||||||
2015
|
$ 0
|
$ 413
|
$ 960
|
$2,880
|
$ 0
|
$60,537
|
$ 0
|
$64,790
|
||||||||
2014
|
$ 0
|
$ 0
|
$2,305
|
$2,880
|
$ 0
|
$64,463
|
$ 0
|
$69,648
|
Named
Executive Officer
|
ITT/ESI
Contributions
Under ESI
401(k) Plan
(I
)
|
Consulting and Severance
Payments
(J)
|
Perquisites
Total
|
All Other
Compensation
(K
)
|
||||
Kevin M. Modany
|
||||||||
2015
|
$4,518
|
$ 0
|
$30,681
|
$ 35,199
|
||||
2014
|
$5,733
|
$ 0
|
$59,981
|
$ 65,714
|
||||
2013
|
$7,650
|
$ 0
|
$47,683
|
$ 55,333
|
||||
Rocco F. Tarasi, III
|
||||||||
2015
|
$4,518
|
$ 0
|
$ 6,073
|
$ 10,591
|
||||
2014
|
$6,589
|
$ 0
|
$ 7,742
|
$ 14,331
|
||||
2013
|
$6,269
|
$ 0
|
$ 6,341
|
$ 12,610
|
||||
Daniel M. Fitzpatrick
|
||||||||
2015
|
$7,518
|
$185,134
|
$33,578
|
$226,230
|
||||
2014
|
$5,733
|
$ 0
|
$ 8,059
|
$ 13,792
|
||||
2013
|
$7,650
|
$ 0
|
$11,818
|
$ 19,468
|
||||
John E. Dean
|
||||||||
2015
|
$5,971
|
$ 0
|
$ 0
|
$ 5,971
|
||||
2014
|
$ 221
|
$ 0
|
$ 0
|
$ 221
|
||||
Eugene W. Feichtner
|
||||||||
2015
|
$5,556
|
$ 0
|
$ 6,555
|
$ 12,111
|
||||
2014
|
$5,339
|
$ 0
|
$ 5,749
|
$ 11,088
|
||||
2013
|
$5,346
|
$ 0
|
$ 5,603
|
$ 10,949
|
||||
Ryan L. Roney
|
||||||||
2015
|
$4,518
|
$ 0
|
$64,790
|
$ 69,308
|
||||
2014
|
$ 831
|
$ 0
|
$69,648
|
$ 70,479
|
|
____________
|
|
(A)
|
Amounts shown represent the aggregate incremental cost to us for the perquisites provided to the Named Executive Officers in each of the years indicated.
|
|
(B)
|
The methodology for computing the aggregate incremental cost to us for providing use of a company car involves compiling the expenses that were paid by us or reimbursed to the Named Executive Officer for the Named Executive Officer’s use of the vehicle. Those expenses include:
|
·
|
the amount of depreciation expense that we recognized on the company-owned car, adjusted to reflect the amount that was realized upon the disposition of the car in January 2016; as a result, we did not include any depreciation expense in the Named Executive Officer's perquisites in 2015 and reduced the amount of depreciation expense that was reported in the 2014 Proxy Statement;
|
·
|
the cost of insurance premiums relating to the car that were paid by us;
|
·
|
the cost of gasoline used in the car that was paid or reimbursed by us; and
|
·
|
the cost of maintenance and repairs of the car that was paid or reimbursed by us.
|
|
(C)
|
The methodology for computing the aggregate incremental cost to us for providing a tax return and financial planning allowance involves determining the sum of all receipts for tax return and financial planning services that are submitted by and reimbursed to the Named Executive Officer up to the amount of the allowance authorized by the Compensation Committee (i.e., 2% of annualized base salary as of the effective date of any increase in base salary for that fiscal year for Mr. Modany, and 1% of annualized base salary as of the effective date of any increase in base salary for that fiscal year for each of the other Named Executive Officers).
|
|
(D)
|
The methodology for computing the aggregate incremental cost to us for providing event tickets involves identifying the specific events that the Named Executive Officer and his or her guests attended during the year and attributing the actual costs paid by us or reimbursed to the Named Executive Officer for the Named Executive Officer and his or her guests to attend the event. Those costs include:
|
·
|
the portion of a license fee for a private suite and associated spectator seats used by the Named Executive Officer and his or her guests;
|
·
|
the cost of food and beverages consumed by the Named Executive Officer and his or her guests in connection with the event;
|
·
|
the cost of tickets used by the Named Executive Officer and his or her guests to attend the event; and
|
·
|
the cost of parking fees incurred by the Named Executive Officer and his or her guests to attend the event.
|
|
(E)
|
The methodology for computing the aggregate incremental cost to us for providing enhanced disability benefits involves:
|
·
|
multiplying the monthly charge to us per employee for the enhanced short-term disability benefits by the number of months;
|
·
|
multiplying the annual charge to us per $100 of coverage for the enhanced long-term disability benefits by the number of $100 increments in the coverage; and
|
·
|
adding together the sum of the amounts calculated in the prior two bullet points.
|
|
(F)
|
The methodology for computing the aggregate incremental cost to us for providing annual physical examinations involves determining the expenses for such examination that have been paid by us directly to the provider or reimbursed to the Named Executive Officer.
|
|
(G)
|
The methodology for computing the aggregate incremental cost to us for providing relocation assistance involves compiling all of the reimbursable expenses, as specified in our relocation assistance program, that have been paid by us or the Named Executive Officer with respect to the relocation.
|
|
(H)
|
The methodology for computing the aggregate incremental cost to us related to legal expenses involves compiling the amounts paid or reimbursed by us related to the fees and expenses of Mr. Modany’s and Mr. Fitzpatrick’s counsel incurred in connection with the negotiation of the Modany Letter Agreement and the Fitzpatrick Letter Agreement, respectively.
|
|
(I)
|
Amounts shown represent our contributions or other allocations made under the ESI 401(k) Plan, a defined contribution plan, for the benefit of the Named Executive Officers in each of the years indicated. See “– Equity Compensation and Qualified Savings Plans –
ESI 401(k) Plan
.”
|
|
(J)
|
The amount shown in this column for Mr. Fitzpatrick in 2015 includes:
|
·
|
severance payment: $64,969;
|
·
|
consulting fees: $99,567; and
|
·
|
COBRA payments: $20,598.
|
|
(K)
|
Amounts shown do not include our cost for employee benefits that do not discriminate in scope, terms or operation in favor of our executive officers and that are available generally to all full-time and part-time regular employees, including, without limitation, medical and dental benefits, vision insurance, life insurance, flexible spending account, business travel and accident insurance, and disability insurance.
|
(8)
|
Amounts shown represent the sum of the dollar values for each compensation element in columns (c) through (i) in each of the years indicated.
|
(9)
|
Mr. Tarasi began his employment with us in June 2011, served as our interim Chief Financial Officer from August 2015 through January 2016 and has served as our Executive Vice President, Chief Financial Officer since January 2016.
|
(10)
|
On August 4, 2014, our Board of Directors appointed Mr. Dean as Executive Chairman of the Board. Mr. Dean has been a Director of ours since 1994, but prior to 2014, he had not been an employee or executive officer of ours. As permitted by the SEC, because 2014 was Mr. Dean’s first year as a Named Executive Officer, the compensation paid to Mr. Dean in years prior to 2014 is not included in this table. Mr. Dean’s compensation as a non-employee Director of ours in prior years, however, has been disclosed in Proxy Statements we previously filed with the SEC.
|
(11)
|
Mr. Roney’s employment with us began in July 2014. The amounts shown in the Stock Awards and Option Awards columns for Mr. Roney reflect the fact that the stock options and RSUs approved by the Compensation Committee in connection with his commencement of employment did not have an effective grant date until June 17, 2015, due to us not being current in our SEC filings until that time.
|
Named
Executive Officer
|
Salary
|
Non-Equity
Incentive Plan
and Bonus
Compensation
(1)
|
Salary and Non-
Equity Incentive
Plan and Bonus
Compensation
(1)
|
Total
Compensation
(2)
|
Salary as a
Percentage of
Total
Compensation
|
Non-Equity
Incentive Plan
and Bonus
Compensation
as a Percentage
of Total
Compensation
|
Salary and Non-
Equity Incentive
Plan and Bonus
Compensation
as a Percentage
of Total
Compensation
|
|||||||
Kevin M. Modany
|
||||||||||||||
2015
|
$824,076
|
$ 515,048
|
$1,339,124
|
$1,379,345
|
59.7%
|
37.3%
|
97.1%
|
|||||||
2014
|
$821,380
|
$ 721,067
|
$1,542,447
|
$3,194,632
|
25.7%
|
22.6%
|
48.3%
|
|||||||
2013
|
$798,596
|
$1,000,093
|
$1,798,689
|
$2,972,627
|
26.9%
|
33.6%
|
60.5%
|
|||||||
Rocco F. Tarasi, III
|
||||||||||||||
2015
|
$221,450
|
$ 77,854
|
$ 299,304
|
$ 389,194
|
56.9%
|
20.0%
|
76.9%
|
|||||||
2014
|
$220,725
|
$ 96,884
|
$ 317,609
|
$ 457,905
|
48.2%
|
21.2%
|
69.4%
|
|||||||
2013
|
$210,219
|
$ 134,375
|
$ 344,594
|
$ 446,452
|
47.1%
|
30.1%
|
77.2%
|
|||||||
Daniel M. Fitzpatrick
|
||||||||||||||
2015
|
$276,548
|
$ 112,348
|
$ 388,896
|
$ 703,019
|
39.3%
|
16.0%
|
55.3%
|
|||||||
2014
|
$410,652
|
$ 334,325
|
$ 744,977
|
$1,136,664
|
36.1%
|
29.4%
|
65.5%
|
|||||||
2013
|
$391,915
|
$ 325,000
|
$ 716,915
|
$1,004,126
|
39.0%
|
32.4%
|
71.4%
|
|||||||
John E. Dean
|
||||||||||||||
2015
|
$575,000
|
$ 0
|
$ 575,000
|
$ 580,971
|
99.0%
|
N/A
|
99.0%
|
|||||||
2014
|
$309,726
|
$ 0
|
$ 309,726
|
$1,309,949
|
23.6%
|
N/A
|
23.6%
|
|||||||
Eugene W. Feichtner
|
||||||||||||||
2015
|
$391,168
|
$ 174,999
|
$ 566,167
|
$ 689,828
|
56.7%
|
25.4%
|
82.1%
|
|||||||
2014
|
$318,366
|
$ 245,000
|
$ 563,366
|
$ 919,914
|
34.6%
|
26.6%
|
61.2%
|
|||||||
2013
|
$309,535
|
$ 232,581
|
$ 542,116
|
$ 731,774
|
42.3%
|
31.8%
|
74.1%
|
|||||||
Ryan L. Roney
|
||||||||||||||
2015
|
$360,000
|
$ 146,250
|
$ 506,250
|
$ 679,320
|
53.0%
|
21.5%
|
74.5%
|
|||||||
2014
|
$174,575
|
$ 102,375
|
$ 276,950
|
$ 347,429
|
50.2%
|
29.5%
|
79.7%
|
|
____________
|
(1)
|
The amounts of non-equity incentive plan and bonus compensation reported in this table include the amounts of such compensation as reported in the Non-Equity Incentive Plan Compensation and Bonus columns of the Summary Compensation Table for each of the years indicated.
|
(2)
|
Amounts shown represent the sum of the dollar values for each compensation element that we are required to report in the Summary Compensation Table for each of the years indicated. See “– Summary Compensation Table.”
|
·
|
amounts paid as salary to the Named Executive Officer in the applicable year, less any tax-qualified deductions such as contributions or premiums paid by the Named Executive Officer to the ESI 401(k) Plan, certain health and welfare benefit plans and health savings accounts;
|
·
|
amounts paid as bonus, non-equity incentive plan compensation and short-term compensation to the Named Executive Officer in the applicable year;
|
·
|
the value realized from the exercise of stock options by the Named Executive Officer in the applicable year, determined by subtracting the exercise price of the option from the market price of a share of our common stock at exercise, and then multiplying that amount by the total number of shares acquired on exercise at that exercise price;
|
·
|
the value realized from the vesting of RSUs held by the Named Executive Officer in the applicable year, determined, for stock-settled RSUs, by multiplying the number of RSUs vested by the market price of a share of our common stock on the vesting date, and for cash-settled RSUs, by multiplying the number of RSUs vested by the average of the closing market prices of our common stock over the 20 trading day period prior to the settlement date;
|
·
|
the value of noncash payments, including certain fringe benefits, made to the Named Executive Officer in the applicable year;
|
·
|
the taxable cost of group-term life insurance in excess of $50,000 for the Named Executive Officer in the applicable year; and
|
·
|
the taxable amount of all other compensation paid to the Named Executive Officer in the applicable year.
|
Name and Principal Position
|
Year
|
Total Wages
(1)
|
Summary
Compensation
Table Total
Compensation
(2)
|
Difference
(3)
|
Total Wages as a
Percentage of
Summary
Compensation
Table Total
Compensation
|
|||||
Kevin M. Modany
Chief Executive Officer
|
2015
|
$2,071,963
|
$1,379,345
|
$ 692,618
|
150.2%
|
|||||
2014
|
$2,120,860
|
$3,194,632
|
$(1,073,772)
|
66.4%
|
||||||
2013
|
$ 919,595
|
$2,972,627
|
$(2,053,032)
|
30.9%
|
||||||
2012
|
$5,336,585
|
$8,763,384
|
$(3,426,799)
|
60.9%
|
||||||
2011
|
$2,419,077
|
$6,412,454
|
$(3,993,377)
|
37.7%
|
||||||
Rocco F. Tarasi, III
Executive Vice President, Chief Financial Officer
|
2015
|
$ 323,343
|
$ 389,194
|
$ (65,851)
|
83.1%
|
|||||
2014
|
$ 339,290
|
$ 457,905
|
$ (118,615)
|
74.1%
|
||||||
2013
|
$ 183,663
|
$ 446,452
|
$ (262,789)
|
41.1%
|
||||||
Daniel M. Fitzpatrick
Former Executive Vice President, Chief Financial Officer
|
2015
|
$ 823,891
|
$ 703,019
|
$ 120,872
|
117.2%
|
|||||
2014
|
$ 796,147
|
$1,136,664
|
$ (340,517)
|
70.0%
|
||||||
2013
|
$ 400,468
|
$1,004,126
|
$ (603,658)
|
39.9%
|
||||||
2012
|
$1,259,366
|
$1,898,591
|
$ (639,225)
|
66.3%
|
||||||
2011
|
$ 764,326
|
$1,527,927
|
$ (763,601)
|
50.0%
|
||||||
John E. Dean
Executive Chairman
|
2015
|
$ 980,636
|
$ 580,971
|
$ 399,665
|
168.8%
|
|||||
2014
|
$ 221,416
|
$1,309,949
|
$(1,088,533)
|
16.9%
|
||||||
Eugene W. Feichtner
President and Chief Operating Officer
|
2015
|
$ 700,405
|
$ 689,828
|
$ 10,577
|
101.5%
|
|||||
2014
|
$ 626,787
|
$ 919,914
|
$ (293,127)
|
68.1%
|
||||||
2013
|
$ 323,208
|
$ 731,774
|
$ (408,566)
|
44.2%
|
||||||
2012
|
$1,542,401
|
$1,767,294
|
$ (224,893)
|
87.3%
|
||||||
2011
|
$ 678,190
|
$1,453,708
|
$ (775,518)
|
46.7%
|
||||||
Ryan L. Roney
Executive Vice President, Chief Administrative and Legal Officer
|
2015
|
$ 475,326
|
$ 679,320
|
$ (203,994)
|
70.0%
|
|||||
2014
|
$ 211,700
|
$ 347,429
|
$ (135,729)
|
60.9%
|
||||||
|
_______________
|
|
(1)
|
Amounts shown are described above the table.
|
|
(2)
|
Amounts shown represent the amounts shown in, or calculated in accordance with the rules for, the Total column of the Summary Compensation Table.
|
|
(3)
|
Amounts shown represent the difference between the Total Wages column and the Summary Compensation Table Total Compensation column.
|
Date
Compensation
Committee
Took Action
|
Estimated Possible Payouts
Under Non-Equity
Incentive Plan Awards
(2)
|
All
Other
Stock
Awards:
Number
of
Shares
|
All Other
Option
Awards:
Number of
Securities
|
Exercise
or Base
Price of
Option
|
Grant
Date
Fair
Value of
Stock
and
|
|||||||||||||
Named
Executive Officer
|
Grant
Date
(1)
|
to Grant
Awards
|
Threshold
(3)
|
Target
(4)
|
Maximum
(5)
|
of Stock
or Units
|
Underlying
Options
|
Awards
($/sh)
(6)
|
Option
Awards
(7)
|
|||||||||
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
(i)
|
(j)
|
|||||||||
Kevin M. Modany
|
||||||||||||||||||
2015 Management Objectives
(8)
|
N/A
|
07/27/15
|
$206,019
|
$824,076
|
$1,648,152
|
N/A
|
N/A
|
N/A
|
N/A
|
|||||||||
Rocco F. Tarasi, III
|
||||||||||||||||||
Stock Option Award
(9)
|
06/17/15
|
01/26/15
(10)
|
N/A
|
N/A
|
N/A
|
N/A
|
5,000
(11)
|
$4.91
|
$18,250
|
|||||||||
RSU Award
(12)
|
06/17/15
|
01/26/15
(10)
|
N/A
|
N/A
|
N/A
|
2,250
(13)
|
N/A
|
N/A
|
$11,048
|
|||||||||
RSU Award
(12)
|
08/06/15
|
07/27/15
(14)
|
N/A
|
N/A
|
N/A
|
16,667
(15)
|
N/A
|
N/A
|
$50,001
|
|||||||||
2015 Management Objectives
(8)
|
N/A
|
01/26/15
|
$ 31,141
|
$124,566
|
$ 249,131
|
N/A
|
N/A
|
N/A
|
N/A
|
|||||||||
Daniel M. Fitzpatrick
|
||||||||||||||||||
Stock Option Award
(9)
|
06/17/15
|
01/26/15
(10)
|
N/A
|
N/A
|
N/A
|
N/A
|
15,000
(11)
|
$4.91
|
$54,750
|
|||||||||
RSU Award
(12)
|
06/17/15
|
01/26/15
(10)
|
N/A
|
N/A
|
N/A
|
6,750
(13)
|
N/A
|
N/A
|
$33,143
|
|||||||||
2015 Management Objectives
(8)
|
N/A
|
01/26/15
|
$ 44,939
|
$179,756
|
$ 359,512
|
N/A
|
N/A
|
N/A
|
N/A
|
|||||||||
Eugene W. Feichtner
|
||||||||||||||||||
Stock Option Award
(9)
|
06/17/15
|
01/26/15
(10)
|
N/A
|
N/A
|
N/A
|
N/A
|
17,500
(11)
|
$4.91
|
$63,875
|
|||||||||
RSU Award
(12)
|
06/17/15
|
01/26/15
(10)
|
N/A
|
N/A
|
N/A
|
7,875
(13)
|
N/A
|
N/A
|
$38,666
|
|||||||||
2015 Management Objectives
(8)
|
N/A
|
01/26/15
|
$ 70,000
|
$280,000
|
$ 560,000
|
N/A
|
N/A
|
N/A
|
N/A
|
|||||||||
Ryan L. Roney
|
||||||||||||||||||
Stock Option Award
(9)
|
06/17/15
|
01/26/15
(10)
|
N/A
|
N/A
|
N/A
|
N/A
|
12,500
(11)
|
$4.91
|
$45,625
|
|||||||||
RSU Award
(12)
|
06/17/15
|
01/26/15
(10)
|
N/A
|
N/A
|
N/A
|
5,625
(13)
|
N/A
|
N/A
|
$27,619
|
|||||||||
Stock Option Award
(9)
|
06/17/15
|
07/21/14
(16)
|
N/A
|
N/A
|
N/A
|
N/A
|
5,208
(17)
|
$4.91
|
$19,009
|
|||||||||
RSU Award
(12)
|
06/17/15
|
07/21/14
(16)
|
N/A
|
N/A
|
N/A
|
2,344
(18)
|
N/A
|
N/A
|
$11,509
|
|||||||||
2015 Management Objectives
(8)
|
N/A
|
01/26/15
|
$ 58,500
|
$234,000
|
$ 468,000
|
N/A
|
N/A
|
N/A
|
N/A
|
(1)
|
Defined as the date of the grant for financial statement reporting purposes pursuant to ASC 718.
|
(2)
|
Amounts shown represent the dollar value of the estimated possible payout upon satisfaction of the conditions subject to the 2015 short-term compensation element.
|
(3)
|
“Threshold” refers to the minimum amount payable for a certain level of results under the plan.
|
(4)
|
“Target” refers to the amount payable, if the specified results target(s) are reached.
|
(5)
|
“Maximum” refers to the maximum payout possible under the plan.
|
(6)
|
Amounts shown represent the per-share exercise or base price of the options granted in the fiscal year.
|
(7)
|
Amounts shown represent the grant date fair value, computed in accordance with ASC 718, of each stock and option award granted to the Named Executive Officer in 2015. There were no adjustments or amendments made in 2015 to the exercise price of any option awards held by any of the Named Executive Officers, whether through amendment, cancellation or replacement grants, or any other means (such as a repricing), or that otherwise materially modified any option awards.
|
(8)
|
Represents awards that could be earned pursuant to the 2015 Management Objectives under the short-term compensation element that were approved by the Compensation Committee. Amounts actually earned in 2015 are reported in the Summary Compensation Table for that year in the “Non-Equity Incentive Plan Compensation” column. See “– Summary Compensation Table.”
|
(9)
|
Represents a nonqualified stock option to purchase our common stock that was granted under the Amended 2006 Plan. See “– Equity Compensation and Qualified Savings Plans –
Amended 2006 Plan
.”
|
(10)
|
The awards were granted by the Compensation Committee during a Committee meeting on January 26, 2015 and had an effective grant date of June 17, 2015.
|
(11)
|
Nonqualified stock option granted at 100% of the closing market price of a share of our common stock on the effective date of the grant. One-third of the shares subject to the option is exercisable on each of February 9, 2016, 2017 and 2018. With respect to Mr. Fitzpatrick, his stock options will continue to vest only as long as he remains a consultant to us. Mr. Fitzpatrick’s Consulting Agreement is scheduled to terminate on March 2, 2017.
|
(12)
|
Represents a grant of RSUs that was made under the Amended 2006 Plan. See “—Equity Compensation and Qualified Savings Plans –
Amended 2006 Plan
.”
|
(13)
|
The period of restriction for this RSU grant lapses in thirds on each of February 9, 2016, 2017 and 2018. These RSUs will be settled in shares of our common stock, one share for each RSU in the grant. With respect to Mr. Fitzpatrick, his RSUs will continue to vest only as long as he remains a consultant to us. Mr. Fitzpatrick’s Consulting Agreement is scheduled to terminate on March 2, 2017.
|
(14)
|
This award was granted by the Compensation Committee during a Committee meeting on July 27, 2015 and had an effective grant date of August 6, 2015.
|
(15)
|
The period of restriction for this RSU grant lapses in thirds on each of August 6, 2016, 2017 and 2018. These RSUs will be settled in shares of our common stock, one share for each RSU in the grant.
|
(16)
|
This award was granted by the Compensation Committee during a Committee meeting on July 21, 2014 and had an effective grant date of June 17, 2015.
|
(17)
|
Nonqualified stock option granted at 100% of the closing market price of a share of our common stock on the effective date of the grant. One-third of the shares subject to the option is exercisable on each of July 7, 2015, 2016 and 2017.
|
(18)
|
The period of restriction for this RSU grant lapses in thirds on each of July 7, 2015, 2016 and 2017. These RSUs will be settled in shares of our common stock, one share for each RSU in the grant.
|
·
|
stock options (incentive and nonqualified);
|
·
|
SARs;
|
·
|
restricted stock;
|
·
|
RSUs;
|
·
|
performance shares;
|
·
|
performance units; and
|
·
|
other stock-based awards.
|
·
|
the maximum aggregate number of shares that may be delivered in connection with stock options intended to be incentive stock options under Section 422 of the IRC (“incentive stock options”) may not exceed 7,350,000 shares;
|
·
|
the maximum aggregate number of shares that may be granted to an individual participant during any calendar year pursuant to:
|
·
|
all forms of awards is 400,000 shares;
|
·
|
incentive stock options is 400,000 shares;
|
·
|
restricted stock and RSU awards is 250,000 shares; and
|
·
|
performance share awards is 250,000 shares;
|
·
|
the aggregate fair market value of shares that may be granted to a non-employee director during any calendar year may not exceed $400,000; and
|
·
|
the maximum aggregate compensation that may be paid pursuant to performance units awarded in any one calendar year to an individual participant is $2,000,000, or a number of shares having an aggregate fair market value not in excess of that amount.
|
·
|
all of the optionee’s stock options with time-based vesting provisions will become immediately exercisable and will remain exercisable until the earlier of:
|
·
|
the date three years after the date of the optionee’s death or disability, or
|
·
|
the date the options expire in accordance with their terms; and
|
·
|
with respect to the optionee’s options with performance-based vesting provisions:
|
·
|
the optionee will forfeit all such options that are not exercisable as of the date of death or disability; and
|
·
|
options that were exercisable as of the date of death or disability will remain exercisable until the earlier of (a) the date three years after such date, or (b) the date the options expire in accordance with their terms.
|
·
|
an optionee will forfeit all of his or her options that had not yet become exercisable; and
|
·
|
options that were exercisable as of the date of the optionee’s termination will remain exercisable until the earlier of (a) the date 90 days after the date of termination, or (b) the date the options expire in accordance with their terms.
|
·
|
upon a participant’s death or disability, the period of restriction will lapse immediately; and
|
·
|
upon termination of a participant’s employment or service with us for any reason other than death or disability, the participant will forfeit all unvested restricted stock immediately after the termination of employment or service.
|
·
|
upon a participant’s death or disability, the period of restriction will lapse immediately, and the RSUs will be settled immediately thereafter; and
|
·
|
upon termination of a participant’s employment or service with us for any reason other than death or disability, the participant will forfeit all of his or her unvested RSUs immediately after the termination of employment or service.
|
·
|
any and all outstanding stock options and SARs granted under the Amended 2006 Plan with time-based vesting provisions will become immediately exercisable;
|
·
|
any restrictions imposed on restricted stock, RSUs and other stock-based awards granted under the Amended 2006 Plan with time-based vesting provisions will lapse; and
|
·
|
any and all performance shares, performance units and other awards (if performance-based) granted under the Amended 2006 Plan will vest on a pro rata monthly basis, including full credit for partial months elapsed, and will be paid (a) based on the level of performance achieved as of the date of the change in control, if determinable, or (b) at the target level, if not determinable.
|
·
|
the acquisition by any person (within the meaning of Section 13(d) of the Exchange Act) or group (as used in Section 14(d)(2) of the Exchange Act), other than us, a subsidiary of ours or any employee benefit plan sponsored by us or a subsidiary of ours, of beneficial ownership (within the meaning of Section 13(d) of the Exchange Act) directly or indirectly of 25% or more of the outstanding shares of our common stock, provided that an increase in the percentage of the outstanding shares of our common stock beneficially owned by any person or group solely as a result of a reduction in the number of shares of our common stock then outstanding due to the repurchase by us of such common stock shall not constitute a change in control, however any subsequent acquisition of shares of our common stock by any person or group resulting in such person or group beneficially owning 25% or more of the outstanding shares of our common stock shall constitute a change in control;
|
·
|
the consummation of any consolidation or merger of us or any sale, lease, exchange or other transfer of all or substantially all of our assets, unless, immediately following such consolidation, merger or sale,
|
·
|
all or substantially all the persons (within the meaning of Section 13(d) of the Exchange Act) who were the beneficial owners of the securities eligible to vote for the election of our Board of Directors (“company voting securities”) outstanding immediately prior to the consummation of such consolidation, merger or sale continue to beneficially own, directly or indirectly, more than 50% of the combined voting power of the then outstanding voting securities of the corporation or other entity resulting from such consolidation, merger or sale in substantially the same proportions as their ownership, immediately prior to the consummation of such consolidation, merger or sale, of the outstanding company voting securities, subject to certain exceptions, and
|
·
|
no person (within the meaning of Section 13(d) of the Exchange Act) (excluding any employee benefit plan or related trust sponsored or maintained by the continuing company or any entity controlled by the continuing company) beneficially owns, directly or indirectly, 25% or more of the combined voting power of the then outstanding voting securities of the continuing company, and
|
·
|
at least a majority of the members of the board of directors of the continuing company were incumbent directors of ours (as defined below) at the time of the execution of the definitive agreement providing for such consolidation, merger or sale or, in the absence of such an agreement, at the time at which approval of our Board of Directors was obtained for such transaction;
|
·
|
during any period of 12 consecutive calendar months, individuals who were directors of ours on the first day of such period (“incumbent directors”) cease for any reason to constitute a majority of our Board of Directors; provided, that any individual becoming a director after the first day of such period whose election or nomination by our shareholders was approved by a vote of at least a majority of the incumbent directors shall be deemed to be an incumbent director (unless such individual’s initial assumption of office occurs as a result of an actual or threatened proxy contest with respect to election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of any person); or
|
·
|
the liquidation or dissolution of us.
|
·
|
nonqualified stock options to our key employees to purchase an aggregate of 121,208 shares of our common stock; and
|
·
|
an aggregate of 260,696 RSUs to our key employees, which RSUs settle in shares of our common stock.
|
Number of Securities to be Issued Upon Exercise of Outstanding Options,
Warrants and Rights
|
Weighted Average Exercise Price of Outstanding Options, Warrants
and Rights
|
Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities
Reflected in Column (a))
|
||||
Plan Category
|
(a)
|
(b)
|
(c)
|
|||
Equity compensation plans
|
||||||
approved by security holders
(1)
|
1,881,227
|
$70.21
(2)
|
2,134,110
(3)(4)(5)
|
|||
Equity compensation plans
|
||||||
not approved by security holders
(6)
|
53,267
|
N/A
|
N/A
(7)
|
|||
Total
|
1,934,494
|
$70.21
(2)
|
2,134,110
|
(1)
|
Consists of the Amended 2006 Plan. The material terms of the Amended 2006 Plan are described above. See
“
–
Amended 2006 Plan.”
|
(2)
|
The weighted average exercise price is calculated based on those awards included in column (a) that have a specified exercise price, namely, outstanding stock options. Since the outstanding RSUs and the shares credited under the Directors Deferred Compensation Plan that are included in column (a) have no exercise price, they have been excluded from the weighted average exercise price calculations in this column (b).
|
(3)
|
The total number of shares of our common stock available for awards under the Amended 2006 Plan is 7,350,000, subject to antidilution adjustments. Each share underlying stock options and SARs granted under the Amended 2006 Plan, and not forfeited or terminated, will reduce the number of shares available for future awards under the Amended 2006 Plan by one share. The delivery of a share in connection with a “full-value award” (i.e., an award of restricted stock, RSUs, performance shares, performance units or any other stock-based award with value denominated in shares) will reduce the number of shares remaining for other awards by three shares, if the full-value award was granted prior to May 7, 2013, and by two shares, if the full-value award was granted after that date.
|
(4)
|
The aggregate fair market value (determined on the date of grant) of the shares subject to incentive stock options awarded to employees under the Amended 2006 Plan that become exercisable for the first time by the employee in any calendar year may not exceed $100,000.
|
(5)
|
Securities remaining available for future issuance under the Amended 2006 Plan include stock options (incentive and nonqualified), SARs, restricted stock, RSUs, performance shares, performance units and other stock-based awards, or any combination of the foregoing, as the Compensation Committee and Board of Directors may determine. The maximum number of performance shares under the Amended 2006 Plan that may be granted to any eligible participant in any given calendar year is 250,000 shares.
|
(6)
|
These equity compensation plans include the:
|
·
|
Directors Deferred Compensation Plan; and
|
·
|
Deferred Bonus Plan.
|
(7)
|
There is no limit on the number of shares of our common stock available for future issuance under either the Directors Deferred Compensation Plan or the Deferred Bonus Plan.
|
Option Awards
|
Stock Awards
|
||||||||||||
Named Executive Officer
|
Number of Securities Underlying
Unexercised Options
|
Option
Exercise
Price
|
Option
Expiration
Date
|
Number of Shares
or Units of Stock
that have Not
Vested
(3)
|
Market Value of
Shares or Units
of Stock that have
Not Vested
(4)
|
||||||||
Exercisable
(1)
|
Unexercisable
(2)
|
||||||||||||
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
|||||||
Kevin M. Modany
|
|||||||||||||
01/28/09 Award
(5)
|
100,000
|
0
|
$121.56
|
01/28/16
|
|||||||||
01/27/10 Award
(6)
|
125,000
|
0
|
$113.41
|
01/27/17
|
|||||||||
01/27/11 Award
(7)
|
125,000
|
0
|
$69.43
|
01/27/18
|
|||||||||
02/13/12 Award - Option
(8)
|
62,500
|
0
|
$75.16
|
02/13/19
|
|||||||||
05/09/13 Award - Option
(9)
|
41,666
|
20,834
|
$19.31
|
05/09/20
|
|||||||||
05/09/13 Award - RSUs
(10)
|
9,375
|
$34,969
|
|||||||||||
02/04/14 Award - Option
(11)
|
20,833
|
41,667
|
$27.94
|
02/04/21
|
|||||||||
02/04/14 Award - RSUs
(12)
|
18,750
|
$69,938
|
|||||||||||
Rocco F. Tarasi, III
|
|||||||||||||
05/09/13 Award - Option
(9)
|
3,333
|
1,667
|
$19.31
|
05/09/20
|
|||||||||
05/09/13 Award - RSUs
(10)
|
750
|
$2,798
|
|||||||||||
02/04/14 Award - Option
(11)
|
1,666
|
3,334
|
$27.94
|
02/04/21
|
|||||||||
02/04/14 Award - RSUs
(12)
|
1,500
|
$5,595
|
|||||||||||
06/17/15 Award - Option
(13)
|
0
|
5,000
|
$4.91
|
06/17/22
|
|||||||||
06/17/15 Award - RSUs
(14)
|
2,250
|
$8,393
|
|||||||||||
08/06/15 Award - RSUs
(15)
|
16,667
|
$62,168
|
|||||||||||
Daniel M. Fitzpatrick
|
|||||||||||||
01/28/09 Award
(5)
|
20,000
|
0
|
$121.56
|
01/28/16
|
|||||||||
01/27/10 Award
(6)
|
22,000
|
0
|
$113.41
|
01/27/17
|
|||||||||
01/27/11 Award - Option
(7)
|
16,500
|
0
|
$69.43
|
01/27/18
|
|||||||||
02/13/12 Award - Option
(8)
|
11,000
|
0
|
$75.16
|
02/13/19
|
|||||||||
05/09/13 Award - Option
(9)
|
10,000
|
5,000
|
$19.31
|
05/09/20
|
|||||||||
05/09/13 Award - RSUs
(10)
|
2,250
|
$8,393
|
|||||||||||
02/04/14 Award - Option
(11)
|
5,000
|
10,000
|
$27.94
|
02/04/21
|
|||||||||
02/04/14 Award - RSUs
(12)
|
4,500
|
$16,785
|
|||||||||||
06/17/15 Award - Option
(13)
|
0
|
15,000
|
$4.91
|
06/17/22
|
|||||||||
06/17/15 Award - RSUs
(14)
|
6,750
|
$25,178
|
|||||||||||
John E. Dean
|
|||||||||||||
05/21/13 Award - RSUs
(16)
|
3,598
|
$13,421
|
|||||||||||
Eugene W. Feichtner
|
|||||||||||||
01/28/09 Award
(5)
|
17,500
|
0
|
$121.56
|
01/28/16
|
|||||||||
01/27/10 Award
(6)
|
20,000
|
0
|
$113.41
|
01/27/17
|
|||||||||
01/27/11 Award - Option
(7)
|
10,000
|
0
|
$69.43
|
01/27/18
|
|||||||||
02/13/12 Award - Option
(8)
|
10,000
|
0
|
$75.16
|
02/13/19
|
|||||||||
05/09/13 Award - Option
(9)
|
6,666
|
3,334
|
$19.31
|
05/09/20
|
|||||||||
05/09/13 Award - RSUs
(10)
|
1,500
|
$5,595
|
|||||||||||
02/04/14 Award - Option
(11)
|
3,333
|
6,667
|
$27.94
|
02/04/21
|
|||||||||
02/04/14 Award - RSUs
(12)
|
3,000
|
$11,190
|
|||||||||||
06/17/15 Award - Option
(13)
|
0
|
17,500
|
$4.91
|
06/17/22
|
|||||||||
06/17/15 Award - RSUs
(14)
|
7,875
|
$29,374
|
|||||||||||
Ryan L. Roney
|
|||||||||||||
06/17/15 Award - Option
(13)
|
0
|
12,500
|
$4.91
|
06/17/22
|
|||||||||
06/17/15 Award - RSUs
(14)
|
5,625
|
$20,981
|
|||||||||||
06/17/15 Award - Option
(17)
|
1,736
|
3,472
|
$4.91
|
06/17/22
|
|||||||||
06/17/15 Award - RSUs
(18)
|
1,563
|
$5,830
|
|
__________
|
(1)
|
Amounts shown represent on an award-by-award basis, the number of securities underlying unexercised options that were exercisable as of December 31, 2015.
|
(2)
|
Amounts shown represent on an award-by-award basis, the number of securities underlying unexercised options that were unexercisable as of December 31, 2015. These options will become exercisable on their scheduled vesting dates as noted in the footnotes below, except that the options will become immediately exercisable upon the occurrence of an acceleration event or change in control, or upon termination of employment due to death or disability.
|
(3)
|
Amounts shown represent on an award-by-award basis, the total number of shares of our common stock that had not vested as of December 31, 2015. These awards will vest on their scheduled vesting dates as noted in the footnotes below, except that the RSUs will immediately vest upon the occurrence of a change in control or upon termination of employment due to death or disability.
|
(4)
|
Amounts shown represent on an award-by-award basis, the aggregate market value of shares of our common stock that had not vested as of December 31, 2015. The aggregate market value is calculated by multiplying the number of shares or units by the closing market price of a share of our common stock on December 31, 2015.
|
(5)
|
This stock option award vested in three equal installments on January 28, 2010, 2011 and 2012.
|
(6)
|
This stock option award vested in three equal installments on January 27, 2011, 2012 and 2013.
|
(7)
|
This stock option award vested in three equal installments on January 27, 2012, 2013 and 2014.
|
(8)
|
This stock option award vested in three equal installments on February 13, 2013, 2014 and 2015.
|
(9)
|
This stock option award vests in three equal installments on May 9, 2014, 2015 and 2016.
|
(10)
|
The remaining portion of this RSU award vests on May 9, 2016, and will be settled in shares of our common stock.
|
(11)
|
This stock option award vests in three equal installments on February 4, 2015, 2016 and 2017.
|
(12)
|
The remaining portion of this RSU award vests in two equal installments on February 4, 2016 and 2017, and will be settled in shares of our common stock.
|
(13)
|
This stock option award vests in three equal installments on February 9, 2016, 2017 and 2018. With respect to Mr. Fitzpatrick, his stock options will continue to vest only as long as he remains a consultant to us. Mr. Fitzpatrick’s Consulting Agreement is scheduled to terminate on March 2, 2017.
|
(14)
|
This RSU award vests in three equal installments on February 9, 2016, 2017 and 2018, and will be settled in shares of our common stock. With respect to Mr. Fitzpatrick, his RSUs will continue to vest only as long as he remains a consultant to us. Mr. Fitzpatrick’s Consulting Agreement is scheduled to terminate on March 2, 2017.
|
(15)
|
This RSU award vests in three equal installments on August 6, 2016, 2017 and 2018, and will be settled in shares of our common stock.
|
(16)
|
This RSU award vests in full on May 21, 2016.
|
(17)
|
This stock option award vests in three equal installments on July 7, 2015, 2016 and 2017.
|
(18)
|
The remaining portion of this RSU award vests in two equal installments on July 7, 2016 and 2017.
|
Option Awards
|
Stock Awards
|
|||||||
Named Executive Officer
|
Number of Shares
Acquired on Exercise
|
Value Realized
on Exercise
|
Number of Shares
Acquired on Vesting
(1)
|
Value Realized
on Vesting
(2)
|
||||
Kevin M. Modany
|
0
|
$0
|
70,245
|
$507,708
|
||||
Rocco F. Tarasi, III
|
0
|
$0
|
2,299
|
$15,446
|
||||
Daniel M. Fitzpatrick
|
0
|
$0
|
14,324
|
$102,636
|
||||
John E. Dean
|
0
|
$0
|
|
131,256
|
$395,464
|
|||
Eugene W. Feichtner
|
0
|
$0
|
11,943
|
$86,568
|
||||
Ryan L. Roney
|
0
|
$0
|
781
|
$2,999
|
|
_____________
|
|
(1)
|
Amounts shown represent the number of shares of our common stock related to which RSUs vested during the fiscal year.
|
|
(2)
|
Amounts shown represent the aggregate dollar amount realized by the Named Executive Officer upon vesting of the RSUs. The dollar amount realized upon vesting of RSUs in 2015 was determined by multiplying the number of RSUs vested by the market price of a share of our common stock on the vesting date. The dollar amounts realized upon vesting of all RSUs in 2015 held by the Named Executive Officer are then added together to obtain the aggregate dollar amount shown in this column.
|
Named Executive Officer
|
Plan Name
(1)
|
Number of
Years of
Credited
Service
(2)
|
Present Value of
Accumulated
Benefit
(3)
|
Payments
During Last
Fiscal Year
(4)
|
||||
Kevin M. Modany
|
||||||||
Old Pension Plan
|
0
(5)
|
$ 0
|
$ 0
|
|||||
ESI Pension Plan
|
4
(6)
|
$ 39,618
|
$ 0
|
|||||
ESI Excess Pension Plan
|
4
(6)
|
$ 51,082
|
$ 0
|
|||||
Rocco F. Tarasi, III
|
||||||||
Old Pension Plan
|
0
(5)
|
$ 0
|
$ 0
|
|||||
ESI Pension Plan
|
0
(5)
|
$ 0
|
$ 0
|
|||||
ESI Excess Pension Plan
|
0
(5)
|
$ 0
|
$ 0
|
|||||
Daniel M. Fitzpatrick
|
||||||||
Old Pension Plan
|
0
(5)
|
$ 0
|
$ 0
|
|||||
ESI Pension Plan
|
0
(5)
|
$ 0
|
$ 0
|
|||||
ESI Excess Pension Plan
|
0
(5)
|
$ 0
|
$ 0
|
|||||
John E. Dean
|
||||||||
Old Pension Plan
|
0
(5)
|
$ 0
|
$ 0
|
|||||
ESI Pension Plan
|
0
(5)
|
$ 0
|
$ 0
|
|||||
ESI Excess Pension Plan
|
0
(5)
|
$ 0
|
$ 0
|
|||||
Eugene W. Feichtner
|
||||||||
Old Pension Plan
|
16
(7)
|
$341,506
|
$ 0
|
|||||
ESI Pension Plan
|
27
(6)
|
$304,971
|
$ 0
|
|||||
ESI Excess Pension Plan
|
27
(6)
|
$ 81,355
|
$ 0
|
|||||
Ryan L. Roney
|
||||||||
Old Pension Plan
|
0
(5)
|
$ 0
|
$ 0
|
|||||
ESI Pension Plan
|
0
(5)
|
$ 0
|
$ 0
|
|||||
ESI Excess Pension Plan
|
0
(5)
|
$ 0
|
$ 0
|
(1)
|
Includes each plan that provides for specific retirement payments and benefits, or payments and benefits that will be provided primarily following retirement, including, without limitation, tax-qualified defined benefit plans and supplemental executive retirement plans, but excluding tax-qualified defined contribution plans and nonqualified defined contribution plans.
|
(2)
|
Computed as of December 31, 2015.
|
(3)
|
Amounts shown represent the actuarial present value of the Named Executive Officer’s accumulated benefit under the plan, computed as of December 31, 2015. The estimated amounts assume that the Named Executive Officer’s retirement age is the normal retirement age as defined in the plan or, if not so defined, the earliest time at which a participant may retire under the plan without any benefit reduction due to age. The estimated amounts are based on the Named Executive Officer’s most current compensation subject to the plan and, as such, future levels of the Named Executive Officer’s compensation are not estimated for purposes of the calculation. The estimated amounts used to quantify the present value of the accumulated benefit under the Old Pension Plan assume a normal retirement age of 65 using the RP-2000 mortality table and a 3.50% discount rate as of December 31, 2015 for each of the Named Executive Officers who participates in the plan. No mortality is assumed prior to age 65 for any of the Named Executive Officers in the estimated amounts shown for the Old Pension Plan. See Note 14 – Employee Benefit Plans of the Notes to Consolidated Financial Statements set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2015 filed with the SEC for a discussion of the valuation method and all material assumptions applied in quantifying the present value of the accumulated benefit under the ESI Pension Plan and ESI Excess Pension Plan.
|
(4)
|
Amounts shown represent the dollar amount of any payments and benefits paid to the Named Executive Officer under each plan identified during 2015.
|
(5)
|
The Named Executive Officer’s employment with us began after participation in the plan by new eligible employees had ended.
|
(6)
|
The Named Executive Officer’s number of years of credited service with respect to the ESI Pension Plan and the ESI Excess Pension Plan is different from the Named Executive Officer’s number of actual years of service with us, because:
|
·
|
any benefit service with ITT Corporation or any of its affiliated companies that was credited to the participating employee under the Old Pension Plan or the Retirement Plan for Salaried Employees of ITT Nevada (the “Nevada Pension Plan”), is treated as benefit service with us under the ESI Pension Plan and the ESI Excess Pension Plan;
|
·
|
the ESI Pension Plan covers only most of our eligible salaried employees who were employed by us prior to June 2, 2003; and
|
·
|
the ESI Excess Pension Plan covers only a select group of our management and highly-compensated employees who were employed by us prior to June 2, 2003.
|
Named Executive Officer
|
Actual Years of
Service With Us or
an Affiliated
Company
(a)
|
Credit Years of
Service Under the
Plan
(b)
|
Difference
(b-a)
|
|||
Kevin M. Modany
|
13.5
|
4
|
(9.5)
|
|||
Eugene W. Feichtner
|
36.6
|
27
|
(9.6)
|
(7)
|
The Named Executive Officer’s number of years of credited service under the Old Pension Plan is different from the Named Executive Officer’s number of actual years of service with us, because our participation in the Old Pension Plan ended on December 19, 1995. The number of years of credited service attributed to each Named Executive Officer reflects the Named Executive Officer’s actual service with a participating company under the Old Pension Plan through the end of our participation in the Old Pension Plan. See “– Pension Plans –
Old Pension Plan
.” The number of years of actual service with us or an affiliated company by each Named Executive Officer who participated in the Old Pension Plan and the difference between that Named Executive Officer’s actual service and credited service under the Old Pension Plan are as follows:
|
Named Executive Officer
|
Actual Years of
Service With Us
or an Affiliated
Company
(a)
|
Credit Years of
Service Under the
Plan
(b)
|
Difference
(b-a)
|
|||
Eugene W. Feichtner
|
36.6
|
16
|
(20.6)
|
·
|
an amount based on the employee’s compensation, age and years of benefit service (the “Pay Credit”) at the end of each plan year (i.e., January 1 through December 31, except for the first plan year of June 9, 1998 through December 31, 1998) through March 31, 2006 of the 2006 plan year;
|
·
|
interest credits on the portion of the balance attributable to Pay Credits credited to the bookkeeping account for plan years prior to the 2002 plan year, calculated as of the end of each plan year at the fixed rate of 8% through December 31, 2010 and 5% beginning January 1, 2011, compounded annually; and
|
·
|
interest credits on the portion of the balance attributable to Pay Credits credited to the bookkeeping account for the 2002 and subsequent plan years, calculated as of the end of each plan year at a variable rate ranging from 6% to 12% through December 31, 2010 and 4% to 12% beginning January 1, 2011, compounded annually.
|
Named Executive Officer
|
Executive
Contributions in
Last Fiscal Year
(1)
|
ITT/ESI
Contributions in
Last Fiscal Year
(1)
|
Aggregate Earnings
in Last Fiscal Year
|
Aggregate Balance at
Last Fiscal Year-End
|
||||
Kevin M. Modany
|
||||||||
ESI Excess Savings Plan
|
$0
|
$0
|
$ 4,920
(2)
|
$64,199
(3)
|
||||
Rocco F. Tarasi, III
|
||||||||
ESI Excess Savings Plan
|
$0
|
$0
|
$ 0
|
$ 0
|
||||
Daniel M. Fitzpatrick
|
||||||||
ESI Excess Savings Plan
|
$0
|
$0
|
$ 0
|
$ 0
|
||||
John E. Dean
|
||||||||
ESI Excess Savings Plan
|
$0
|
$0
|
$ 0
|
$ 0
|
||||
Directors Deferred Compensation Plan
|
$0
|
$0
|
$(95,227)
(4)
|
$60,407
(5)
|
||||
Eugene W. Feichtner
|
||||||||
ESI Excess Savings Plan
|
$0
|
$0
|
$ 348
(2)
|
$ 4,540
(3)
|
||||
Ryan L. Roney
|
||||||||
ESI Excess Savings Plan
|
$0
|
$0
|
$ 0
|
$ 0
|
|
____________
|
|
(1)
|
Effective for plan years beginning on and after January 1, 2008, we froze the ESI Excess Savings Plan, such that eligible employees may no longer make elective contributions and we no longer make contributions under the ESI Excess Savings Plan. See “—Nonqualified Deferred Compensation Plans—
ESI Excess Savings Plan
.”
|
|
(2)
|
Represents the dollar amount of the aggregate interest or other earnings accrued during 2015 to the Named Executive Officer’s account under the ESI Excess Savings Plan. The only portion of these amounts that is reported as compensation to the Named Executive Officer in the Summary Compensation Table for the 2015 year is the above-market or preferential earnings in 2015 on the balance of the Named Executive Officer’s account under the ESI Excess Savings Plan which are included in the Change in Pension Value and Nonqualified Deferred Compensation Earnings column of the Summary Compensation Table. See “– Summary Compensation Table.”
|
|
(3)
|
Represents the dollar amount of the total balance of the Named Executive Officer’s account at the end of 2015 under the ESI Excess Savings Plan. The only portion of these amounts that is reported as compensation to the Named Executive Officer in the Summary Compensation Table for each of the 2014 and 2013 years is the above-market or preferential portion of aggregate earnings under the ESI Excess Savings Plan in 2014 and 2013, which contribute to the aggregate balance of the Named Executive Officer’s ESI Excess Savings Plan account at year-end 2015. Those earnings are included in the amount of the Named Executive Officer’s compensation for the particular year and are reported in the Change in Pension Value and Nonqualified Deferred Compensation Earnings column of the Summary Compensation Table for that particular year. The amount of those above-market or preferential earnings for each of the Named Executive Officers is specified in the table below.
|
ESI Excess Savings Plan
Above-Market
Earnings in Fiscal Year
|
||||
Named Executive Officer
|
2014
|
2013
|
||
Kevin M. Modany
|
$2,696
|
$3,011
|
||
Rocco F. Tarasi, III
|
$ 0
|
$ 0
|
||
Daniel M. Fitzpatrick
|
$ 0
|
$ 0
|
||
John E. Dean
|
$ 0
|
$ 0
|
||
Eugene W. Feichtner
|
$ 192
|
$ 214
|
||
Ryan L. Roney
|
$ 0
|
$ 0
|
|
(4)
|
Represents the dollar amount of the stock price depreciation during 2015 attributable to the deferred shares credited to Mr. Dean’s deferred stock account under the Directors Deferred Compensation Plan. None of this amount is reported as compensation to Mr. Dean in the Summary Compensation Table.
|
|
(5)
|
Represents the fair value of the total balance of Mr. Dean’s deferred stock account at the end of 2015 under the Directors Deferred Compensation Plan, calculated by multiplying the number of shares credited to Mr. Dean’s deferred stock account by the closing price of a share of our common stock on December 31, 2015. The portion of this amount that relates to elections by Mr. Dean to receive and defer his annual retainer in shares of our common stock in prior years was reported in the Directors Compensation Table in prior years’ Proxy Statements.
|
·
|
restoring their contributions lost under the ESI 401(k) Plan due to the federal limitations;
|
·
|
restoring our matching and non-matching contributions lost under the ESI 401(k) Plan due to the federal limitations; and
|
·
|
deferring a portion of their salaries equal to either 5% or the same deferral percentage that they elected under the ESI 401(k) Plan.
|
·
|
the acquisition of ownership (other than by way of merger or consolidation with an entity that, immediately before the acquisition, was a Controlling Company (as defined in the ESI Excess Savings Plan and below)) during any 12 month period, by any one person or more than one person acting as a group, of all or substantially all of the assets of a Controlling Company;
|
·
|
the acquisition (other than by a Controlling Company) by any one person or more than one person acting as a group, of ownership of more than 50% of the total fair market value or total voting power of the ownership interests of stock of a Controlling Company;
|
·
|
the acquisition (other than by a Controlling Company) during any 12 month period, by any one person or more than one person acting as a group, of ownership of stock of a Controlling Company possessing 30% or more of the total voting power of stock of the Controlling Company; or
|
·
|
the replacement of a majority of members of the board of directors or comparable governing body of a Controlling Company, during any 12-month period, by members whose appointment or election is not endorsed by a majority of the members of the Controlling Company’s board of directors or comparable governing body prior to the date of the appointment or election.
|
·
|
us;
|
·
|
a related company that participates in the ESI Excess Savings Plan and employs the eligible employee;
|
·
|
a related company that is the majority owner of us or a participating company that employs the eligible employee; or
|
·
|
any related company in an uninterrupted chain of majority ownership culminating in the ownership of us or a participating company that employs the eligible employee.
|
·
|
the covered executive’s employment is terminated, other than for cause, or when the covered executive terminates his or her employment for good reason, in each case within two years after the occurrence of an acceleration event, as described below; or
|
·
|
the covered executive’s employment is terminated, other than for cause, during an imminent acceleration event period, as described below.
|
·
|
three times his highest annual base salary rate paid and his highest bonus paid or awarded any time during the three years immediately preceding the acceleration event (or in the case of a termination that occurs during an imminent acceleration event period, the three-year period immediately preceding the first day of the imminent acceleration event period);
|
·
|
a lump sum amount equal to three times the product of his highest annual base salary rate paid during the three years immediately preceding the acceleration event (or in the case of a termination that occurs during an imminent acceleration event period, the three-year period immediately preceding the first day of the imminent acceleration event period), multiplied by the highest percentage rate of our contributions with respect to him under the ESI 401(k) Plan at any time during that three year period;
|
·
|
a lump sum stipend equal to 36 times the monthly premium that, as of the date of Mr. Modany’s termination of employment, is charged to qualified beneficiaries for health care continuation coverage under COBRA, for the same coverage options and levels of medical, prescription drug, dental and vision coverage that he had in effect under our welfare plans immediately prior to his termination of employment;
|
·
|
a lump sum stipend equal to 36 times the full monthly premium payable to our life insurance carrier for the type and level of life insurance coverage (including, if applicable, dependent life insurance coverage) in effect for him immediately prior to his termination of employment; and
|
·
|
a tax gross-up payment that covers any excise tax, interest and penalties under the IRC arising from the payment to him of any amount under the Senior Executive Severance Plan or otherwise as a result of an acceleration event.
|
·
|
two times his highest annual base salary rate paid and his highest bonus paid or awarded any time during the three years immediately preceding the acceleration event (or in the case of a termination that occurs during an imminent acceleration event period, the three-year period immediately preceding the first day of the imminent acceleration event period);
|
·
|
a lump sum amount equal to two times the product of his highest annual base salary rate paid during the three years immediately preceding the acceleration event (or in the case of a termination that occurs during an imminent acceleration event period, the three-year period immediately preceding the first day of the imminent acceleration event period), multiplied by the highest percentage rate of our contributions with respect to that executive under the ESI 401(k) Plan at any time during that three year period;
|
·
|
a lump sum stipend equal to 24 times the monthly premium that, as of the date of the executive’s termination of employment, is charged to qualified beneficiaries for COBRA continuation coverage for the same coverage options and levels of medical, prescription drug, dental and vision coverage that the executive had in effect under our welfare plans immediately prior to his termination of employment; and
|
·
|
a lump sum stipend equal to 24 times the full monthly premium payable to our life insurance carrier for the type and level of life insurance coverage (including, if applicable, dependent life insurance coverage) in effect for him immediately prior to his or her termination of employment;
|
·
|
will not be employed by, work for, consult with, lend assistance to or engage in businesses competitive with ours for a period of one year after termination of employment;
|
·
|
will not solicit or induce to leave any of our employees for a period of one year after the executive’s termination of employment;
|
·
|
will not urge or induce any of our customers or others with whom we have a business relationship to terminate or limit their business with us for a period of one year after termination of employment;
|
·
|
will not disparage us for a period of one year after termination of employment; and
|
·
|
will not disclose or use our confidential information for as long a period of time as permitted by applicable law, and in any event for a period of at least three years after termination of employment.
|
·
|
a report on Schedule 13D is filed with the SEC disclosing that any person, other than us or one of our subsidiaries or any employee benefit plan that we or one of our subsidiaries sponsors, is the beneficial owner of 20% or more of the outstanding shares of our common stock, other than as a result of an increase in the percentage of the outstanding shares beneficially owned by such person solely as a result of a reduction in the number of shares then outstanding due to the repurchase by us of our common stock, provided that any subsequent acquisition of shares of our common stock by any person resulting in such person beneficially owning 20% or more of the outstanding shares of our common stock shall constitute an acceleration event;
|
·
|
a person, other than us or one of our subsidiaries or any employee benefit plan that we or one of our subsidiaries sponsors, purchases shares of our common stock in connection with a tender or exchange offer, if after consummation of the offer the person purchasing the shares is the beneficial owner of 15% or more of the outstanding shares of our common stock;
|
·
|
our shareholders approve:
|
·
|
any consolidation or merger of us in which we are not the continuing or surviving corporation or our common stock is converted into cash, securities or other property, unless the transaction was a merger in which our shareholders immediately prior to the merger would have the same proportionate ownership of common stock of the surviving corporation that they held in us immediately prior to the merger; or
|
·
|
any sale, lease, exchange or other transfer of all or substantially all of our assets; or
|
·
|
a majority of the members of our Board of Directors changes within a 12-month period, unless the election or nomination for election of each of the new Directors by our shareholders had been approved by two-thirds of the Directors still in office who had been Directors at the beginning of the 12-month period.
|
·
|
beginning on the first to occur of:
|
·
|
a public announcement of a proposal or offer that, if consummated, would be an acceleration event;
|
·
|
a making to one or more of our Directors or executive officers of a written proposal that, if consummated, would be an acceleration event; or
|
·
|
approval by our Board of Directors or shareholders of a transaction that, upon closing, would be an acceleration event; and
|
·
|
ending upon the first to occur of:
|
·
|
a public announcement that the contemplated acceleration event has been terminated or abandoned;
|
·
|
the occurrence of the contemplated acceleration event; or
|
·
|
18 months after the beginning of the imminent acceleration event period.
|
·
|
a material diminution in the covered executive’s base compensation;
|
·
|
a material diminution in the covered executive’s authority, duties or responsibilities;
|
·
|
a material diminution in the authority, duties or responsibilities of the person to whom the covered executive is required to report (including, for example, a requirement that a covered executive who previously reported to the Board of Directors instead report to a corporate officer or employee);
|
·
|
a material diminution in the budget over which the covered executive retains authority;
|
·
|
a material change in the geographic location at which the covered executive must perform services; and
|
·
|
if the terms and conditions of a covered executive’s employment are governed by an agreement, any other action or inaction that constitutes a material breach by us or any successor of the agreement.
|
Type of Benefit
|
Modany
|
Tarasi
|
Feichtner
|
Roney
|
|||||
Salary
|
$2,472,228
|
$442,900
|
$ 800,000
|
$ 720,000
|
|||||
Bonus
|
$3,000,279
|
$268,750
|
$ 490,000
|
$ 292,500
|
|||||
Stipend in Lieu of Health Insurance Benefits
|
$ 39,549
|
$ 26,366
|
$ 26,366
|
$ 26,366
|
|||||
Stipend in Lieu of Life Insurance Benefits
|
$ 18
|
$ 12
|
$ 12
|
$ 12
|
|||||
Foregone Savings Plan Benefits
|
$ 23,850
|
$ 18,000
|
$ 15,900
|
$ 15,900
|
|||||
Tax Gross-Up Payment to Cover Excise Tax
(1)
|
$ 0
|
N/A
|
N/A
|
N/A
|
|||||
Reduction to Limit Excise Taxes
(1)
|
$ 0
|
$ (0)
|
$ (0)
|
$ (0)
|
|||||
Total
|
$5,535,924
|
$756,028
|
$1,332,278
|
$1,054,778
|
|
(1)
|
The estimated value of any excise tax, and thereby the amount of any tax gross-up payment and the calculation of any reduction to limit excise taxes, are based on the highest marginal rate of federal, state and local taxes related to the severance benefits specified in the table and any other payments to the Named Executive Officer arising from an acceleration event. These amounts are also based on an assumption that, as a result of the covenant not to compete in the Senior Executive Severance Plan, the value of one year’s base salary and target bonus would constitute “reasonable compensation” under Section 280G of the IRC and therefore would be excluded from the calculation of the amount of any excise tax, the amount of any tax gross-up payment and the reduction, if any, required to limit excise taxes.
|
·
|
all outstanding stock options with time-based vesting restrictions granted to the Named Executive Officer under the Amended 2006 Plan will become exercisable immediately;
|
·
|
all restrictions imposed on restricted stock and RSUs with time-based vesting restrictions granted to the Named Executive Officer under the Amended 2006 Plan will lapse immediately, and the RSUs will be settled immediately thereafter; and
|
·
|
the Plan Committee will determine the extent to which a Named Executive Officer will have the right to receive other stock awards granted to the Named Executive Officer under the Amended 2006 Plan.
|
·
|
all outstanding stock options with time-based vesting restrictions granted to the Named Executive Officer under the Amended 2006 Plan will become exercisable immediately;
|
·
|
all restrictions imposed on restricted stock and RSUs with time-based vesting restrictions granted to the Named Executive Officer under the Amended 2006 Plan will lapse immediately, and the RSUs will be settled immediately thereafter; and
|
·
|
in the discretion of the Plan Committee, all outstanding stock options may be terminated and each participant may receive, with respect to each share subject to the options, an amount in cash equal to the excess of the consideration payable with respect to one share in connection with the change in control over the option’s exercise price.
|
·
|
the acquisition by any person (within the meaning of Section 13(d) of the Exchange Act), other than us, a subsidiary of ours or any employee benefit plan sponsored by us or a subsidiary of ours, of a beneficial ownership directly or indirectly of 20% or more of the outstanding shares of our common stock, provided that an increase in the percentage of the outstanding shares of our common stock beneficially owned by any person (within the meaning of Section 13(d) of the Exchange Act) solely as a result of a reduction in the number of shares of our common stock then outstanding due to the repurchase by us of such common stock shall not constitute a change in control, however any subsequent acquisition of shares of our common stock by any person (within the meaning of Section 13(d) of the Exchange Act) resulting in such person beneficially owning 20% or more of the outstanding shares of our common stock shall constitute a change in control;
|
·
|
the purchase by any person (within the meaning of Section 13(d) of the Exchange Act), other than us, a subsidiary of ours or any employee benefit plan sponsored by us or a subsidiary of ours, of shares pursuant to a tender offer or exchange offer to acquire our common stock (or securities convertible into common stock) for cash, securities or any other consideration, provided that after consummation of the offer, the person in question is the beneficial owner (as such term is defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of 15% or more of the outstanding shares of our common stock (calculated as provided in paragraph (d) of Rule 13d-3 under the Exchange Act in the case of rights to acquire common stock);
|
·
|
our shareholders approve (a) any consolidation or merger of us in which we are not the continuing or surviving corporation or pursuant to which shares of our common stock would be converted into cash, securities or other property, other than a merger of us in which holders of our common stock immediately prior to the merger have the same proportionate ownership of common stock of the surviving corporation immediately after the merger as immediately before, or (b) any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all or substantially all of our assets;
|
·
|
a change in a majority of the members of our Board of Directors within a 12-month period, unless the election or nomination for election by our shareholders of each new Director during such 12-month period was approved by the vote of two-thirds of the Directors then still in office who were Directors at the beginning of such 12-month period; or
|
·
|
the liquidation or dissolution of us.
|
·
|
a Named Executive Officer’s employment with us terminates as a result of the Named Executive Officer’s death or disability;
|
·
|
there is a change in control of us; or
|
·
|
the Plan Committee determines to fully vest awards in a disposition of a subsidiary with which the officer was engaged primarily in service,
|
December 31, 2015 Value of Unvested Awards
|
||||||||
Termination Due
to Death or Disability
|
Change in Control
|
|||||||
Named Executive Officer
|
Stock Options
(1)
|
RSUs
(2)
|
Stock Options
(1)
|
RSUs
(2)
|
||||
Kevin M. Modany
|
$0
|
$104,907
|
$0
|
$104,907
|
||||
Rocco F. Tarasi, III
|
$0
|
$ 78,954
|
$0
|
$ 78,954
|
||||
Daniel M. Fitzpatrick
|
$0
|
$ 50,356
|
$0
|
$ 50,356
|
||||
John E. Dean
|
$0
|
$ 13,421
|
$0
|
$ 13,421
|
||||
Eugene W. Feichtner
|
$0
|
$ 46,159
|
$0
|
$ 46,159
|
||||
Ryan L. Roney
|
$0
|
$ 26,811
|
$0
|
$ 26,811
|
|
_____________
|
|
(1)
|
Amounts shown represent the aggregate dollar amount that could be realized from all outstanding, unvested stock option awards granted to the Named Executive Officer under the Amended 2006 Plan, if those options became vested and were exercised by the Named Executive Officer on December 31, 2015.
|
|
(2)
|
Amounts shown are calculated by multiplying the number of unvested RSUs held by the Named Executive Officer that would vest upon the specified event by the closing market price of a share of our common stock on December 31, 2015.
|
Named Executive Officer
|
Amount of Salary Deferrals, ITT/ESI
Vested Contributions and Accrued
Interest as of December 31, 2015
|
|
Kevin M. Modany
|
$64,199
|
|
Rocco F. Tarasi, III
|
$ 0
|
|
Daniel M. Fitzpatrick
|
$ 0
|
|
John E. Dean
|
$ 0
|
|
Eugene W. Feichtner
|
$ 4,540
|
|
Ryan L. Roney
|
$ 0
|
Named Executive Officer
|
Balance of ESI Pension
Plan Account as of December 31, 2015
|
|
Kevin M. Modany
|
$ 39,618
(1)
|
|
Rocco F. Tarasi, III
|
$ 0
|
|
Daniel M. Fitzpatrick
|
$ 0
|
|
John E. Dean
|
$ 0
|
|
Eugene W. Feichtner
|
$304,971
|
|
Ryan L. Roney
|
$ 0
|
|
__________
|
|
(1)
|
Benefit payable upon death or disability as of December 31, 2015. If the employment of Mr. Modany was terminated for any reason other than death or disability on December 31, 2015, his benefit would not be payable until he reaches age 55, because he was not at least age 55 as of that date.
|
Named Executive Officer
|
Balance of ESI Excess Pension
Plan Account as of December 31, 2015
|
|
Kevin M. Modany
|
$51,082
|
|
Rocco F. Tarasi, III
|
$ 0
|
|
Daniel M. Fitzpatrick
|
$ 0
|
|
John E. Dean
|
$ 0
|
|
Eugene W. Feichtner
|
$81,355
|
|
Ryan L. Roney
|
$ 0
|
Name
|
Fees Earned or
Paid in Cash
(1)
|
Stock
Awards
(2)
|
Nonqualified Deferred Compensation
Earnings
(3)
|
All Other
Compensation
|
Total
(4)
|
|||||
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
|||||
C. David Brown
|
$ 50,753
|
$100,002
|
$ 0
|
$ 0
|
$150,755
|
|||||
Jerry M. Cohen
|
$136,918
|
$100,002
|
$ 0
|
$ 0
|
$236,920
|
|||||
John F. Cozzi
|
$175,000
|
$100,002
|
$ 0
|
$ 0
|
$275,002
|
|||||
James D. Fowler, Jr.
|
$175,000
|
$100,002
|
$ 0
|
$ 0
|
$275,002
|
|||||
Joanna T. Lau
|
$175,000
|
$100,002
|
$ 0
|
$ 0
|
$275,002
|
|||||
Thomas I. Morgan
|
$175,000
|
$100,002
|
$ 0
|
$ 0
|
$275,002
|
|||||
Samuel L. Odle
|
$175,000
|
$100,002
|
$7,500
|
$ 0
|
$282,502
|
|||||
Vin Weber
|
$175,000
|
$100,002
|
$ 0
|
$ 0
|
$275,002
|
|||||
John A. Yena
|
$175,000
|
N/A
|
$ 0
|
$ 0
|
$175,000
|
|
____________
|
(1)
|
Amounts shown represent the aggregate dollar amount of all fees earned or paid for services as a Director, which in 2015 consisted of an annual retainer and the amount that would have been granted in the form of RSUs to the non-employee directors in 2014, but which was postponed to 2015 due to our company not being current in its filings with the SEC and which the Board determined to pay in cash. The amount of the annual retainer paid to Mr. Brown in 2015 was pro-rated based on the date he was appointed to the Board, April 29, 2015. For Mr. Cohen, the amount paid to him that would have been granted in the form of RSUs in 2014, but instead was paid in cash in 2015, was pro-rated based on the date he was appointed to the Board in 2014 and the fact that the RSU grant would otherwise have been made on May 1, 2014.
|
(2)
|
Amounts shown represent the aggregate grant date fair value, computed in accordance with ASC 718, of all RSU awards granted for services as a Director in 2015. In 2015, each non-employee Director other than Mr. Yena received a grant of 20,367 RSUs that will be settled in shares of our common stock after vesting. The aggregate grant date fair value includes any earnings, such as dividends, that may be received on the stock awards. Mr. Yena did not receive this RSU award due to the fact that he was not standing for re-election at the 2015 Annual Meeting of Shareholders. This RSU grant to Mr. Fowler was forfeited when he resigned from our Board of Directors on December 26, 2015.
|
Name
|
Grant Date Fair
Value of Stock Award
|
|
(a)
|
(b)
|
|
C. David Brown
|
||
2006 Equity Compensation Plan Award
|
$100,002
|
|
Jerry M. Cohen
|
||
2006 Equity Compensation Plan Award
|
$100,002
|
|
John F. Cozzi
|
||
2006 Equity Compensation Plan Award
|
$100,002
|
|
James D. Fowler, Jr.
|
||
2006 Equity Compensation Plan Award
|
$100,002
|
|
Joanna T. Lau
|
||
2006 Equity Compensation Plan Award
|
$100,002
|
|
Thomas I. Morgan
|
||
2006 Equity Compensation Plan Award
|
$100,002
|
|
Samuel L. Odle
|
||
2006 Equity Compensation Plan Award
|
$100,002
|
|
Vin Weber
|
||
2006 Equity Compensation Plan Award
|
$100,002
|
|
John A. Yena
|
||
2006 Equity Compensation Plan Award
|
N/A
|
|
The following table sets forth information regarding the aggregate number of unvested stock awards granted by us to the non-employee Directors that were outstanding on December 31, 2015:
|
Name
|
Number of Shares or
Units of Stock that
have Not Vested
(A)
|
Market Value of Shares
or Units of Stock that
have Not Vested
(B)
|
(a)
|
(b)
|
(c)
|
C. David Brown
|
||
06/17/15 Award
(C)
|
20,367
|
$75,969
|
Jerry M. Cohen
|
||
06/17/15 Award
(C)
|
20,367
|
$75,969
|
John F. Cozzi
|
||
05/21/13 Award
(D)
|
3,598
|
$13,421
|
06/17/15 Award
(C)
|
20,367
|
$75,969
|
Joanna T. Lau
|
||
05/21/13 Award
(D)
|
3,598
|
$13,421
|
06/17/15 Award
(C)
|
20,367
|
$75,969
|
Thomas I. Morgan
|
||
05/21/13 Award
(D)
|
3,598
|
$13,421
|
06/17/15 Award
(C)
|
20,367
|
$75,969
|
Samuel L. Odle
|
||
05/21/13 Award
(D)
|
3,598
|
$13,421
|
06/17/15 Award
(C)
|
20,367
|
$75,969
|
Vin Weber
|
||
05/21/13 Award
(D)
|
3,598
|
$13,421
|
06/17/15 Award
(C)
|
20,367
|
$75,969
|
|
__________
|
|
(A)
|
Amounts shown represent the total number of shares or units of our common stock that have not vested.
|
|
(B)
|
Amounts shown represent the aggregate market value of RSUs that have not vested. The aggregate market value is calculated by multiplying the number of RSUs by the closing market price of a share of our common stock on December 31, 2015.
|
|
(C)
|
This RSU award vests in full on May 1, 2016 or, if earlier, upon termination of the Director’s service on our Board of Directors due to the expiration of the last term that the Director is permitted to serve pursuant to any then-effective term or age limitation contained in any of our guidelines, policies, principles or other corporate document that results in the Director not being able to be nominated to a new term on our Board of Directors.
|
|
(D)
|
This RSU award vests in full on May 21, 2016 or, if earlier, upon termination of the Director’s service on our Board of Directors due to the expiration of the last term that the Director is permitted to serve pursuant to any then-effective term or age limitation contained in any of our guidelines, policies, principles or other corporate document that results in the Director not being able to be nominated to a new term on our Board of Directors.
|
|
(3)
|
Amounts shown represent the above-market or preferential earnings on compensation deferred under the Directors Deferred Compensation Plan. See “—Director Compensation –
Directors Deferred Compensation Plan
.” Interest is above-market only if the rate of interest exceeds 120% of the applicable federal long-term rate, with compounding (as prescribed under Section 1274(d) of the IRC), at the rate that corresponds most closely to the rate under the applicable plan at the time the interest rate or formula is set. In the event of a discretionary reset of the interest rate, the requisite calculation is made on the basis of the interest rate at the time of such reset, rather than when originally established. Only the above-market portion of the interest is included.
|
|
(4)
|
Amounts shown represent the sum of the dollar values for each compensation element shown in columns (b) through (e).
|
·
|
an annual retainer of $75,000 payable in one installment on the first business day of 2016;
|
·
|
no separate meeting fees; and
|
·
|
a grant of phantom units on May 2, 2016, that:
|
·
|
will have a value of $100,000, plus the value associated with any fractional unit necessary to cause the grant to be for a whole number of units, pursuant to which the value is determined based on the closing market price of a share of our common stock on the effective date of the grant;
|
·
|
will vest on May 2, 2017; and
|
·
|
will be paid in cash in an amount equal to the number of phantom units held by the Director, multiplied by the closing market price of a share of our common stock on May 2, 2017.
|
ITT/ESI Common Stock
|
||||
Name of Beneficial Owner
|
Number of Shares
Beneficially
Owned
(1)
|
Percent of Class
|
||
Putnam Investments, LLC d/b/a Putnam Investments
Putnam Investment Management, LLC
The Putnam Advisory Company, LLC
Putnam Voyager Fund
|
3,389,153
(2)
|
14.3%
|
||
One Post Office Square
Boston, MA 02109
|
||||
Warburg Pincus Asset Management, Inc.
|
2,933,150
(3)
|
12.4%
|
||
466 Lexington Avenue
New York, NY 10017
|
||||
Nantahala Capital Management, LLC
Wilmot B. Harkey
Daniel Mack
|
2,555,084
(4)
|
10.8%
|
||
19 Old Kings Highway South, Suite 200
Darien, CT 06820
|
||||
Capital World Investors
|
1,869,000
(5)
|
7.9%
|
||
333 South Hope Street
Los Angeles, CA 90071
|
||||
Providence Equity Partners VI L.P.
Providence Equity GP VI L.P.
Providence Equity Partners VI L.L.C.
Jonathan M. Nelson
Glenn M. Creamer
Paul J. Salem
|
1,483,610
(6)
|
6.3%
|
||
c/o Providence Equity Partners L.L.C.
50 Kennedy Plaza, 18
th
Floor
Providence, RI 02903
|
||||
Kevin M. Modany
|
467,503
(7)
|
1.9%
|
||
John E. Dean
|
127,469
(8)
|
*
|
||
Eugene W. Feichtner
|
83,411
(9)
|
*
|
||
Daniel M. Fitzpatrick
|
91,978
(10)
|
*
|
||
Ryan L. Roney
|
7,731
(11)
|
*
|
||
Rocco F. Tarasi, III
|
11,411
(12)
|
*
|
||
C. David Brown
|
0
|
*
|
||
Jerry M. Cohen
|
0
|
*
|
||
John F. Cozzi
|
26,149
(13)
|
*
|
||
Joanna T. Lau
|
15,148
(14)
|
*
|
||
Thomas I. Morgan
|
0
|
*
|
||
Samuel L. Odle
|
10,414
(15)
|
*
|
||
Vin Weber
|
32,055
(16)
|
*
|
||
All Directors and executive officers as of 3/1/16 as a group (15 individuals)
|
927,317
(17)
|
3.8%
|
|
*
|
Less than 1%.
|
(1)
|
All shares of our common stock are owned directly except as otherwise indicated. Pursuant to the SEC’s regulations, shares (a) receivable by Directors and executive officers upon exercise of stock options exercisable within 60 days after March 1, 2016, (b) receivable by Directors and executive officers upon vesting of RSUs within 60 days after March 1, 2016, (c) allocated to the accounts of certain Directors and executive officers under the ESI 401(k) Plan at March 1, 2016 or (d) credited to the accounts of certain Directors under the Directors Deferred Compensation Plan at March 1, 2016, are deemed to be beneficially owned by such Directors and executive officers.
|
(2)
|
Based solely on information in reports filed by the beneficial owners under Section 13(d) or 13(g) of the Exchange Act. Putnam Investments, LLC, d/b/a Putnam Investments (“PI”) wholly owns two registered investment advisers, Putnam Investment Management, LLC (“PIM”) and The Putnam Advisory Company, LLC (“PAC”). Both subsidiaries have dispositive power over the shares as investment managers. Putnam Voyager Fund (“PVF”) is part of the Putnam Family of Funds. PI possesses sole power to vote or to direct the vote of 3,402 shares and sole power to dispose or direct the disposition of 3,389,153 shares. PIM possesses sole power to dispose or direct the disposition of 3,385,751 shares. PAC possesses sole power to vote or to direct the vote of 3,402 shares and sole power to dispose or direct the disposition of 3,402 shares. PVF possesses sole power to vote or to direct the vote of, and sole power to dispose or direct the disposition of, 2,179,992 shares.
|
(3)
|
Based solely on information in reports filed by the beneficial owner under Section 13(d) or 13(g) of the Exchange Act. The beneficial owner is a registered investment adviser and has (a) sole power to vote or direct the vote of 2,396,100 shares, (b) shared power to vote or direct the vote of 513,450 shares and (c) sole power to dispose or direct the disposition of 2,933,150 shares.
|
(4)
|
Based solely on information in reports filed by the beneficial owner under Section 13(d) or 13(g) of the Exchange Act. Nantahala Capital Management, LLC ("Nantahala") is an investment adviser and Wilmot B. Harkey and Daniel Mack are control persons, and they possess shared power to vote or to direct the vote of, and shared power to dispose or direct the disposition of, 2,555,084 shares. Nantahala Capital Partners SI, LP, a fund advised by Nantahala, has the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, approximately 5.6% of the 2,555,084 shares.
|
(5)
|
Based solely on information in reports filed by the beneficial owner under Section 13(d) or 13(g) of the Exchange Act. The beneficial owner is an investment adviser and a division of Capital Research and Management Company, which acts as an investment adviser to various investment companies. The beneficial owner indicates that it holds the shares on behalf of its client SMALLCAP World Fund, Inc. The beneficial owner possesses sole power to vote or to direct the vote of, and sole power to dispose or direct the disposition of, 1,869,000 shares.
|
(6)
|
Based solely on information in reports filed by the beneficial owners under Section 13(d) or 13(g) of the Exchange Act. Providence Equity Partners VI L.P. (“PEP VI”), a partnership, is the record holder of 1,483,610 shares. Based on the following relationships, the beneficial owners reported shared voting and dispositive power over 1,483,610 shares: (a) Providence Equity GP VI L.P. (“PEP GP VI”) is the sole general partner of PEP VI; (b) Providence Equity Partners VI L.L.C. (“PEP VI LLC”) is the sole general partner of PEP GP VI; and (c) Messrs. Nelson, Creamer and Salem each are members of PEP VI LLC and partners of PEP GP VI. Each of PEP GP VI, PEP VI LLC and Messrs. Nelson, Creamer and Salem disclaims beneficial ownership of the shares reported, except to the extent of its or his pecuniary interest therein.
|
(7)
|
This number includes 71,446
shares owned directly, 225 shares owned under the ESI 401(k) Plan and 395,832
shares subject to presently exercisable options.
|
(8)
|
This number includes 111,274 shares owned directly and 16,195 shares deferred under the Directors Deferred Compensation Plan.
|
(9)
|
This number includes 16,298
shares owned directly, 7,948 shares owned under the ESI 401(k) Plan and 59,165
shares subject to presently exercisable options.
|
(10)
|
This number includes 17,478 shares owned directly and 74,500
shares subject to presently exercisable options.
|
(11)
|
This number includes 1,829
shares owned directly and 5,902
shares subject to presently exercisable options.
|
(12)
|
This number includes 3,079
shares owned directly and 8,332
shares subject to presently exercisable options.
|
(13)
|
This number includes 11,019 shares owned directly, 2,000 shares owned by Mr. Cozzi’s children and 13,130 shares deferred under the Directors Deferred Compensation Plan.
|
(14)
|
This number includes 12,599 shares owned directly and 2,549 shares deferred under the Directors Deferred Compensation Plan.
|
(15)
|
This number includes 7,557 shares owned directly and 2,857 shares deferred under the Directors Deferred Compensation Plan.
|
(16)
|
This number includes 13,519 shares owned directly and 18,536 shares deferred under the Directors Deferred Compensation Plan.
|
(17)
|
This number includes 281,816 shares owned directly, 2,000 shares owned indirectly, 8,173 shares owned under the ESI 401(k) Plan, 582,061 shares subject to presently exercisable options, and 53,267 shares deferred under the Directors Deferred Compensation Plan.
|
·
|
Our Board of Directors must be notified in advance or as soon as practicable of the Transaction.
|
·
|
The notification to our Board should be in writing and contain the following information regarding the Transaction:
|
·
|
the name of the related person;
|
·
|
the basis on which the person is a related person;
|
·
|
a detailed description of the related person’s interest in the Transaction, including the related person’s position(s) or relationship(s) with, or ownership in, a firm, corporation or other entity that is a party to, or has an interest in, the Transaction;
|
·
|
the approximate dollar value of the amount involved in the Transaction;
|
·
|
the approximate dollar amount of the related person’s interest in the Transaction, which must be computed without regard to the amount of profit or loss;
|
·
|
in the case of an indebtedness Transaction:
|
·
|
the largest aggregate amount of all indebtedness outstanding at any time since the beginning of our last fiscal year and all amounts of interest payable on the outstanding indebtedness during our last fiscal year (excluding amounts due from the related person for purchases of goods and services subject to usual trade terms, for ordinary business travel and expense payments and for other transactions in the ordinary course of business);
|
·
|
the largest aggregate amount of principal that could be outstanding;
|
·
|
a schedule specifying the principal amount that is anticipated to be outstanding from time to time during the Transaction;
|
·
|
the term of the indebtedness;
|
·
|
the repayment schedule of the principal amount;
|
·
|
the total amount of any interest that is anticipated to accrue on the principal amount;
|
·
|
the interest rate; and
|
·
|
the payment schedule of the interest that accrues on the principal amount;
|
·
|
in the case of a lease or other Transaction providing for periodic payments or installments, the aggregate amount of all periodic payments or installments due on or after the beginning of our last fiscal year, including any required or optional payments due during or at the conclusion of the Transaction;
|
·
|
in the case of a Transaction involving a purchase or sale of assets by or to us otherwise than in the ordinary course of business, the cost of the assets to the purchaser and, if acquired within two years of the Transaction, the cost of the assets to the seller and related information about the price of the assets; and
|
·
|
any other information regarding the Transaction or related person in the context of the Transaction that a reasonable investor of ours would consider material in light of the circumstances of the Transaction.
|
·
|
Upon receipt of the above information, all of the members of our Board of Directors (except for any Director who is the related person or whose immediate family member is the related person) will review and consider the information and determine whether it is in our and our shareholders’ best interests for the Board to approve or ratify the Transaction.
|
·
|
Our Board of Directors is of the general belief that, except in exceptional circumstances, we should try to avoid participating in any Transaction, regardless of the Transaction’s merit or benefit to us or our shareholders, in order to avoid any appearance of a conflict of interest or impropriety that may be perceived from our participation in the Transaction.
|
·
|
If our Board of Directors approves or ratifies our participation in a Transaction, we may participate in the Transaction.
|
·
|
If our Board of Directors does not approve or ratify our participation in a Transaction:
|
·
|
we will not participate in the Transaction, if our participation has not yet begun; or
|
·
|
we will attempt to end or limit as much as possible our participation in the Transaction without breaching any of our obligations arising from the Transaction.
|
·
|
We will disclose our participation in any Transaction in accordance with Item 404(a) of Regulation S-K under the Exchange Act.
|
·
|
any indebtedness transaction in which the related person qualifies as such solely because he or she is a beneficial owner of more than 5% of any class of our voting securities or is an immediate family member of the beneficial owner;
|
·
|
any employment relationship or transaction involving any of our executive officers and any related compensation solely resulting from that employment relationship or transaction, if:
|
·
|
we report the compensation arising from the relationship or transaction to the SEC in accordance with Item 402 of Regulation S-K under the Exchange Act; or
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the executive officer is not an immediate family member of the related person and we would have reported such compensation to the SEC in accordance with Item 402 of Regulation S-K under the Exchange Act as compensation earned for services to us if the executive officer was a “named executive officer” of ours (as that term is defined in Item 402(a)(3) of Regulation S-K under the Exchange Act) and such compensation had been approved as such by the Compensation Committee of our Board of Directors;
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any compensation paid to any of our Directors, if the compensation is reported to the SEC in accordance with Item 402(k) of Regulation S-K under the Exchange Act;
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any transaction in which the rates or charges involved in the transaction are determined by competitive bids;
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any transaction that involves the rendering of services as a common or contract carrier or public utility at rates or charges fixed in conformity with law or governmental authority;
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any transaction that involves services as a bank depository of funds, transfer agent, registrar, trustee under a trust indenture or similar services; or
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any transaction in which the interest of the related person arises solely from the ownership of a class of our equity securities and all holders of that class of equity securities received the same benefit or a pro rata basis.
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any of our Directors or executive officers;
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anyone who has been nominated to be elected one of our Directors;
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any beneficial owner of more than 5% of any class of our voting securities; and
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any immediate family member of any of the foregoing persons.
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the interest arises only:
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from such person’s position as a director of another corporation or organization that is a party to the transaction;
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from the direct or indirect ownership by such person and all other related persons, in the aggregate, of less than a 10% equity interest in another person (other than a partnership) that is a party to the transaction; or
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from both such position and ownership; or
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·
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the interest arises only from such person’s position as a limited partner in a partnership in which the person and all other related persons, in the aggregate, have an interest of less than 10%, and the person is not a general partner of and does not hold another position in the partnership.
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our Corporate Governance Guidelines;
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the charter for each of the Audit, Compensation, and Nominating and Corporate Governance Committees of our Board of Directors; and
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our Code.
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our Annual Report on Form 10-K for the fiscal year ended December 31, 2015 filed with the SEC, excluding certain of its exhibits;
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our Corporate Governance Guidelines;
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the charter for each of the Audit, Compensation, and Nominating and Corporate Governance Committees of our Board of Directors; and
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the Code.
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Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The Notice and Proxy Statement and the Form 10-K are available at www.proxyvote.com.
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VOTE BY INTERNET – www.proxyvote.com or scan the QR Barcode above
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ITT EDUCATIONAL SERVICES, INC.
13000 NORTH MERIDIAN STREET
CARMEL, IN 46032-1404
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Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date. Follow the instructions to obtain your records and to create an electronic voting instruction form.
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ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS
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If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years.
|
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VOTE BY PHONE – 1-800-690-6903
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Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you call and then follow the instructions.
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VOTE BY MAIL
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Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.
|
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ITT EDUCATIONAL SERVICES, INC.
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The Board of Directors recommends you vote FOR the following:
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1.
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Election of Directors
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|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
For
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Against
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Abstain
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
1a. Jerry M. Cohen |
¨
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¨
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¨
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1b. T homas I. Morgan |
¨
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¨
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¨
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|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
The Board of Directors recommends you vote FOR proposals 2 and 3.
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||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
For
|
Against
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Abstain
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2.
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To ratify the appointment of Deloitte & Touche LLP to serve as ITT Educational Services, Inc.’s independent registered public accounting firm for its fiscal year ending December 31, 2016.
|
¨
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¨
|
¨
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
3.
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Advisory vote to approve named executive officer compensation.
|
¨
|
¨
|
¨
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NOTE:
In their discretion, the proxies are authorized to vote upon such other matters that may properly come before the meeting or any adjournment(s) thereof. The shares represented by this proxy, when properly executed, will be voted in the manner directed herein by the undersigned shareholders(s). If no direction is made, this proxy will be voted
FOR
proposals 1, 2 and 3. If any other matters properly come before the meeting, or if cumulative voting is required, the persons named as proxies in this proxy will vote in their discretion.
|
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For address change and/or comments, please check this box and write them on the back where indicated.
|
¨
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Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name, by authorized officer.
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Signature [PLEASE SIGN WITHIN BOX] Date |
Signature (Joint Owners)
|
Date |
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1 Year ITT Educational Services (CE) Chart |
1 Month ITT Educational Services (CE) Chart |
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