SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934 (Amendment No. )

~~Filed by the Registrant~~ þ

~~Filed by a Party other than the Registrant~~ o

~~Check the appropriate box:~~

~~Diebold, Incorporated~~

~~Payment of Filing Fee (Check the appropriate box):~~

P. O. Box 3077 • North Canton, Ohio44720-8077

Dear Shareholder:




~~JOHN N. LAUER~~ HENRY D.G. WALLACE Executive Chairman of the Board		~~THOMAS W. SWIDARSKI~~ ~~President and Chief Executive Officer~~

Important Notice Regarding the Availability of Proxy Materials for the

Annual Meeting of Shareholders to be held on April 25, 2013.

This proxy statement, along with our Annual Report for the year ended December 31, 2012, are available free

of charge at www.proxyvote.com (you will need to reference the 12-digit control number found on your proxy card

or Notice of Internet Availability of Proxy Materials in order to vote).

P.O. Box 3077 • North Canton, Ohio44720-8077

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

April ~~29, 2010~~25, 2013

~~10:00~~11:30 a.m. ~~EST~~

To ratify the appointment of KPMG LLP as ~~the Company’s~~our independent ~~auditors~~registered public accounting firm for the year ~~2010;~~2013; and

Your attention is directed to the attached proxy statement, which fully describes these items.

Any action on the items of business described above may be considered at the Annual Meeting at the time and on the date specified above or at any time and date to which the Annual Meeting may be properly adjourned or postponed.

The enclosed proxy card is solicited, and the persons named therein have been designated, by ~~the~~Diebold’s Board of ~~Directors of the Company.~~Directors.

~~By Order of the Board of Directors~~



		By Order of the Board of Directors

		Chad F. Hesse
		Vice President, General Counsel and Secretary

March ~~16, 2010~~13, 2013

(approximate mailing date)

You are requested to cooperate in assuring a quorum by voting online at www.proxyvote.com

~~YOU ARE REQUESTED TO COOPERATE IN ASSURING A~~or, if you received a paper copy of the proxy materials, by filling in, signing and dating the

enclosed proxy and promptly mailing it in the return envelope.

~~QUORUM BY FILLING IN, SIGNING, DATING AND PROMPTLY~~

DIEBOLD, INCORPORATED

5995 Mayfair Road

P.O. Box 3077 • North Canton, Ohio44720-8077

PROXY STATEMENT

~~Annual Meeting of Shareholders, April 29, 2010~~ANNUAL MEETING OF SHAREHOLDERS, APRIL 25, 2013

General Information

This proxy statement is furnished to shareholders of Diebold, Incorporated ~~(the “Company”)~~ in connection with the solicitation by the Board of Directors of proxies ~~that will~~to be used at ~~the 2010~~our 2013 Annual Meeting of Shareholders, ~~to be held at the Sheraton Suites, 1989 Front Street, Cuyahoga Falls, Ohio 44221, on April 29, 2010, at 10:00 a.m. EST,~~and any postponements or ~~any~~ adjournments ~~thereof, for the purpose of considering and acting upon the matters referred to in the preceding Notice of Annual Meeting and more fully discussed below.~~

~~Record Date and Share Ownership~~

~~On March 1, 2010, the record date for the meeting, the outstanding voting securities~~ of the ~~Company consisted of 66,295,977 Common Shares, $1.25 par value per share, all of one class. Each shareholder of record as of the close of business on March 1, 2010 will be entitled~~meeting.

These proxy materials are being sent to ~~one vote for each Common Share held on that date.~~

~~Submitting and Revoking Your Proxy~~

~~This proxy statement and accompanying form of proxy were first mailed to~~our shareholders on or about March ~~16, 2010. If you complete~~13, 2013.

Questions and ~~submit your proxy, the persons named as proxies on your proxy card, which we refer to as the Proxy Committee, will vote the shares represented by your proxy in accordance with your instructions.~~Answers

~~If you submit a proxy card but do not fill out the voting instructions on the proxy card, the Proxy Committee will vote the shares represented by your proxy as follows:~~



• Q:	~~FOR~~	When and where is the ~~election of the director-nominees set forth in “Proposal No. 1: Election of Directors.”~~Annual Meeting?

A:		The 2013 Annual Meeting will be held at the Sheraton Suites, 1989 Front Street, Cuyahoga Falls, Ohio 44221, on April 25, 2013, at 11:30 a.m. EDT.

Q:		What items will be voted on at the Annual Meeting?

A:		At the Annual Meeting, you are being asked to:

		• Elect ten directors;

		• Ratify the appointment of KPMG LLP as our independent registered public accounting firm for 2013; and

		• Approve, on an advisory basis, our named executive officer compensation.

		If a permissible proposal other than the listed proposals is presented at the Annual Meeting, your proxy gives authority to the individuals named in the proxy to vote on any such proposal in accordance with their best judgment. We have not received notice of other matters that may be properly presented at the Annual Meeting.

Q:		Who is entitled to vote at the Annual Meeting?

A:		Our record date for the 2013 Annual Meeting is February 25, 2013. Each shareholder of record of our common shares as of the close of business on February 25, 2013 is entitled to one vote for each common share held. As of the record date, there were 63,340,496common shares outstanding and entitled to vote at the Annual Meeting.

Q:		How do I vote?

A:		If you were a shareholder on the record date and you held shares in your own name, you have three ways to vote and submit your proxy before the Annual Meeting:

		• By mail – You may vote by completing, signing and returning the proxy card that you will receive in the mail;

		• By Internet – We encourage you to vote and submit your proxy online at www.proxyvote.com. Even if you request and receive a paper copy of the proxy materials, you may vote online by going to www.proxyvote.com and entering your control number, which is a 12 digit number located in a box on your proxy card that you will receive in the mail; or

		• By telephone – You may vote and submit your proxy by calling 1-800-690-6903 and providing your control number, which is a 12-digit number located in a box on your proxy card that you will receive in the mail.

		If you complete and submit a proxy card, the persons named as proxies on your proxy card, which we refer to as the Proxy Committee, will vote the shares represented by your proxy in accordance with your instructions. If you submit your proxy card but do not indicate your voting preferences, the Proxy Committee will vote according to the recommendation of the Board.



Q:		How does the Board recommend I vote?

A:		The Board recommends a vote:

		• FOR each of our ten nominees for director;

		• FORthe ratification of the appointment of KPMG LLP as our independent registered public accounting firm for 2013; and

		• FORthe ~~independent auditors set forth~~approval of our named executive officer compensation.

Q:		Can I change my vote after I have voted?

A:		You may change your vote at any time before your proxy is voted at the Annual Meeting by:

		• Revoking your proxy by sending written notice or submitting a later dated, signed proxy before the Annual Meeting to our Secretary at the company’s address above;

		• Submitting a later dated, signed proxy before the start of the Annual Meeting;

		• If you have voted by the Internet or by telephone, you may vote again over the Internet or by telephone by 11:59 p.m. EDT on April 24, 2013; or

		• Attending the Annual Meeting, withdrawing your earlier proxy and voting in ~~“Proposal No. 2: Ratification~~person.

Q:		What is cumulative voting and how can I cumulate my votes for the election of ~~Appointment~~directors?

A:		In cumulative voting, each shareholder may cast a number of ~~Independent Auditors.~~votes equal to the number of shares owned multiplied by the number of directors to be elected, and that number of the votes may be cast all for one director-nominee only or distributed among the director-nominees.

		In order to cumulate votes for the election of a director, a shareholder must give written notice to our Executive Chairman, any Vice President or our Secretary no later than 9:59 a.m. EDT on April 23, 2013 that the shareholder desires that the voting for the election of directors be cumulative, and if an announcement of such notice is made upon convening the Annual Meeting by the Chairman or Secretary of the meeting, or by or on behalf of the shareholder giving the notice, each shareholder will have cumulative voting.

		We have received written notice from a shareholder that it desires that cumulative voting be in effect for the election of directors. Accordingly, unless contrary instructions are received on the enclosed proxy, it is presently intended that all votes represented by properly executed proxies will be divided evenly among the director-nominees. However, if voting in such manner would not be effective to elect all such director-nominees, votes will be cumulated at the discretion of the Proxy Committee so as to maximize the number of such director-nominees elected.

Q:		How many votes are required to adopt each proposal?

A:		For Proposal 1, the director-nominees receiving the greatest number of votes will be elected, subject to our Majority Voting Policy described below. For each of Proposals 2 and 3, the affirmative vote of the holders of a majority of the votes cast, whether in person or by proxy, is required for approval. The results of the voting at the meeting will be tabulated by the inspectors of election appointed for the Annual Meeting.

Q:		What is the Majority Voting Policy?

A:		Votes withheld with respect to the election of directors will not be counted in determining the outcome of that vote. However, our Board of Directors has adopted a policy that any director-nominee that is elected but receives a greater number of votes withheld from his or her election than votes in favor of election is expected to tender his or her resignation following certification of the shareholder vote, as described in greater detail below under “Majority Voting Policy.”

Q:		What is a “broker non-vote?”

• A:	~~FOR~~	If your shares are held in the ~~re-approval~~name of a brokerage firm, your shares may be voted even if you do not provide the brokerage firm with voting instructions. Brokerage firms have the authority under the New York Stock Exchange, or NYSE, rules to vote shares for which their customers do not provide voting instructions on certain “routine” matters. When a proposal is not a routine matter under NYSE rules and the brokerage firm has not received voting instructions from the beneficial owner of the ~~Company’s~~shares with respect to that proposal, the brokerage firm cannot vote the shares on that proposal. This is referred to as a “broker non-vote.”




		Proposal 2, the ratification of KPMG LLP as our independent registered public accounting firm for the year 2013, is the only routine matter for which the brokerage firm who holds your shares can vote your shares on these proposals without your instructions. Accordingly, there should be no broker non-votes with respect to Proposal 2. Broker non-votes will have no effect on the outcome of Proposal 3.

Q:		How many shares must be present to constitute a quorum and conduct the Annual ~~Cash Bonus Plan set forth in “Proposal No. 3: Re-Approval~~Meeting?

A:		A quorum is necessary to hold the Annual Meeting. A majority of the outstanding shares present or represented by proxy constitutes a quorum for the purpose of adopting a proposal at the Annual Meeting. If you are present and vote in person at the Annual Meeting, or vote on the Internet, by telephone or by submitting a properly executed proxy card, you will be considered part of the quorum. Broker non-votes will not be part of the voting power present, but will be counted to determine whether or not a quorum is present.

Q:		What happens if I abstain?

A:		A share voted “abstain” with respect to any proposal is considered as present and entitled to vote with respect to the proposal, but is not considered a vote cast with respect to the proposal. Accordingly, for Proposal 1, abstentions will have no effect on the election of directors, except in regards to the Majority Voting Policy described above. For Proposals 2 and 3, abstentions will not be counted for determining the outcome of these proposals.

Q:		Why did I receive a one-page notice in the mail regarding Internet availability of proxy materials instead of a full set of proxy materials?

A:		Under rules adopted by the Securities and Exchange Commission, or SEC, we have elected to provide access to our proxy materials on the Internet. Accordingly, we are sending you a Notice of Internet Availability of Proxy Materials. The instructions found in the notice explain that all shareholders will have the ability to access the proxy materials on www.proxyvote.com or request to receive a printed copy of the proxy materials. You may also request to receive proxy materials in printed form by mail or electronically by email on an ongoing basis. Diebold ~~Incorporated~~encourages you to take advantage of the availability of the proxy materials on the Internet to help reduce the environmental impact of our Annual ~~Cash Bonus Plan.”~~Meeting.

Q:		What shares are included on my proxy card or Notice of Internet Availability of Proxy Materials?

A:		The number of shares printed on your proxy card(s) represents all your shares under a particular registration. Receipt of more than one proxy card or Notice of Internet Availability of Proxy Materials means that certain of your shares are registered differently and are in more than one account. If you receive more than one proxy card, sign and return all your proxy cards to ensure that all your shares are voted. If you receive more than one Notice, reference the distinct 12-digit control number on each Notice when voting by Internet.

~~In addition, if other matters are properly presented for voting at the Annual Meeting, the Proxy Committee will vote on such matters in accordance with their best judgment. We have not received notice~~

Table of ~~other matters that may properly be presented for voting at the Annual Meeting.~~Contents

Shareholders may revoke the authority granted by their proxies at any time before the exercise of the powers conferred thereby by: providing notice in writing delivered to the Secretary of the Company; submitting a subsequently dated proxy; or attending the Annual Meeting, withdrawing the proxy and voting in person.

~~Cumulative Voting~~

If a shareholder gives written notice to the President, any Vice President or Secretary at least 48 hours prior to the time fixed for holding the Annual Meeting that the shareholder desires that the voting for the election of directors shall be cumulative, and if an announcement of such notice is made upon convening of the Annual Meeting by the Chairman or Secretary or by or on behalf of the shareholder giving such notice, each shareholder will have cumulative voting rights.

In cumulative voting, each shareholder may cast a number of votes equal to the number of shares owned multiplied by the number of directors to be elected, and the votes may be cast for one nominee only or distributed among the nominees.

~~In the event that voting at the Annual Meeting is to be cumulative, unless contrary instructions are received on the enclosed proxy, it is presently intended~~

that all votes represented by properly executed proxies will be divided evenly among the candidates nominated by the Board. However, if voting in such manner would not be effective to elect all such nominees, such votes will be cumulated at the discretion of the Proxy Committee so as to maximize the number of such nominees elected.

~~Votes Required to Adopt Proposals~~

The results of shareholder voting at the Annual Meeting will be tabulated by the inspectors of elections appointed for the Annual Meeting. We intend to treat properly executed proxies that are marked “abstain” as present for purposes of determining whether a quorum has been achieved at the Annual Meeting, but will not count any broker non-votes for such purpose.

The director-nominees receiving the greatest number of votes will be elected. Votes withheld with respect to the election of directors will not be counted in determining the outcome of that vote. However, our Board of Directors has adopted a policy that any director-nominee that is elected but receives a greater number of votes withheld from his or her election than votes in favor of election is expected to tender his or her resignation following certification of the shareholder vote, as described in greater detail below under “~~Majority Voting Policy~~.” All other matters to be considered at the Annual Meeting require, for approval, the affirmative vote of a majority of Common Shares voted at the meeting in person or by proxy. Broker non-votes and abstentions with respect to the proposal to ratify the appointment of the independent auditors and the proposal to re-approve the annual cash bonus plan will not be counted for determining the outcome of those proposals.

CORPORATE GOVERNANCE

Board Leadership Structure

We currently separate the permanent roles of our Chief Executive Officer, or CEO, and our Chairman of the Board; however, in the past, we have combined ~~these roles.~~them. The Board initially separated the roles ~~upon the election of our current CEO~~ in ~~late~~ 2005 to allow ~~him~~our CEO at the time to concentrate on re-aligning our business priorities and running our business operations as we transitioned to new leadership. We currently intend to keep these roles separate. However, as disclosed in our Current Report on Form 8-K filed on January 24, 2013, Thomas W. Swidarski, our former CEO, stepped down from that position and from the Board effective January 19, 2013. In addition, John N. Lauer, our prior Chairman of the Board, is retiring from the Board effective as of the 2013 Annual Meeting. To provide for essential executive management of the company until a permanent CEO is appointed, and to allow for effective transition of the Chairman position prior to the 2013 Annual Meeting, the Board nominated and appointed Henry D.G. Wallace to temporarily serve as Executive Chairman of the Board, effective January 19, 2013.

~~The~~Upon the appointment of a permanent CEO, Mr. Wallace will become our non-executive Chairman of the Board, in addition to his other Board committee appointments. Also following the appointment of a permanent CEO, the Board intends to maintain separation of the permanent CEO and Chairman roles at least through 2015. Otherwise, the Board does not have a specific policy with respect to separating versus combining ~~the CEO and Chairman~~these roles, or whether the Chairman should be an employee or non-employee director. Therefore, while the Board currently separates the roles of CEO and Chairman, the Board has the right to combine those roles in the future if it determines that such a combination would be in the best interest of the Company and its shareholders. As such, the Board, primarily ~~through~~under the guidance of the Board Governance Committee, will continue to periodically ~~reviews~~review our leadership structure to determine ~~if it is still appropriate~~whether to maintain this separation after 2015 in light of ~~current~~applicable corporate governance standards, market practices, our specific circumstances and needs, and any other factors that may be relevant to the ~~discussion.~~analysis.

Board Meetings and Executive Sessions

During 2012, the Board held five meetings. Except for Mr. Soin, all of our current directors attended 75% or more of the aggregate of all meetings of the Board and the Board committees on which they served during 2012. Mr. Soin joined the Board at the April 2012 Annual Meeting of Shareholders, and of the three 2012 Board and committee meetings that took place following his appointment, he missed one due to a previously scheduled conflict.

In accordance with the NYSE’s corporate governance standards, our independent directors regularly meet in executive session without management present, generally following each regularly-scheduled Board meeting. In addition, on occasion our independent directors will meet in executive session prior to the start of a Board meeting. Our Chairman of the Board during 2012, John N. Lauer, was an independent director and presided over executive sessions. Mr. Lauer was unable to attend one Board meeting, in December 2012, and delegated his Chairman responsibilities and oversight obligations for that Board meeting to Henry D.G. Wallace, who, at the time, was also an independent director.

Board Risk Oversight

The Board ~~has~~and the Board committees collectively have an active role ~~as a whole and also at the committee level,~~ in overseeing management of the ~~Company’s risks.~~company’s risks, and in helping the company establish an appropriate risk tolerance. The Board oversees the company’s risk strategy and effectiveness; however, management is responsible for identifying risks inherent in our business, as well as implementing and supervising day-to-day risk management. Accordingly, the Board and the ~~relevant~~appropriate committees receive regular reports from ~~members of~~our senior management on areas of material risk to ~~the Company,~~us, including operational, financial, strategic, compliance, competitive, reputational, legal and regulatory risks. The Board also meets with senior management, at least annually, for atwo-day strategic planning session and discussion of the key risks inherent in our short- and long-term strategies at the development ~~stage, and also receives~~stage. Senior management then provides the Board with periodic updates ~~on our~~throughout the year with respect to these strategic initiatives ~~throughout~~and the ~~year.~~impact of these key risks.

AtIn addition, each Board committee is responsible for evaluating certain risks within its area of responsibility and overseeing the management of such risks. The entire Board of Directors is then informed about such risks and management’s response to each one through regular committee reports delivered by the committee ~~level,~~chairs. Below is a summary of the risk oversight roles of each committee:

Board Governance Committee Risk Oversight

As reported in our proxy statement for our 2012 Annual Meeting of Shareholders, the Board and management created the Diebold Risk Council, or DRC, in 2011 in order to better align our efforts of identifying, assessing, managing and monitoring enterprise-wide risks, and to better coordinate our risk management decisions, practices, policies and activities across the company. In 2012, the Board Governance Committee assumed the primary oversight responsibility for enterprise risk management generally, including oversight of the DRC. The DRC receives regular reports from the other management

Table of Contents

committees, as noted under “Other Risk Oversight” below, and provides for regular and consistent communications among our senior management and the Board, primarily through the Board Governance Committee.

In addition, the Board Governance Committee manages risks associated with the independence of our Board, corporate governance and potential conflicts of interest.

Audit Committee Risk Oversight

Our Audit Committee regularly reviews our financial statements, internal controls over financial ~~and~~reporting (among other areas), as well as the effectiveness of our internal controls and ~~remediation~~the status of ~~material weaknesses~~any efforts that may be required to remediate internal control deficiencies identified by management or our independent auditors. In evaluating the effectiveness of our internal controls, the Audit Committee relies on the advice and counsel of our independent auditors to identify risks that arise during their regular reviews of our financial statements, and reports to the Board following each regularly scheduled Audit Committee meeting. The Audit Committee also has primary responsibility for the initial review of any credible ethics complaints disclosed pursuant to our Code of Business Ethics, discussed further in ~~internal controls.~~ “Code of Business Ethics” below.

Compensation Committee Risk Oversight

Our Compensation Committee regularly reviews our executive compensation policies and practices, and employee benefits, and the risks associated with each. ~~Our Board Governance Committee manages risks associated with~~At the ~~independence~~request of our ~~Board,~~Compensation Committee, management also reviews and evaluates our compensation policies and practices applicable to all employees that may create risks for our company. This evaluation includes reviews by members of our human resources, legal, finance and internal audit departments. The Compensation Committee also engages its independent compensation consultant to conduct a comprehensive risk assessment of our executive compensation policies and practices, discussed in detail below under “Compensation Discussion and Analysis,” and the results of these reviews and assessments are presented to the Compensation Committee for its review and final assessment. As a result, we have determined that our compensation policies and practices do not create risk that is reasonably likely to have a material adverse effect on the company.

As described in more detail below under “Compensation Discussion and Analysis,” our Compensation Committee has developed an executive compensation philosophy that does not encourage unnecessary or excessive risk taking. Executives’ base salaries are fixed in amount, bonuses are capped and tied to corporate ~~governance~~performance, and ~~potential~~

~~conflicts~~a large portion of ~~interest.~~ executives’ compensation is provided in the form of long-term equity awards, the value of which are ultimately tied to the price of our common shares, all of which help to align executives’ interests with our shareholders.

Other Risk Oversight

Our Investment Committee oversees the management of risks associated with ~~the Company’s~~our credit, liquidity, investments and investment strategy. While each committee is responsible for evaluating certain risks and overseeing the management of such risks, the entire Board of Directors is regularly informed through committee reports about such risks.related strategies.

~~Further,~~In addition, we have ~~several~~numerous management committees ~~that meet regularly to discuss~~tasked in part with reviewing risks and potential risks ~~as they arise or may arise fromday-to-day~~ inrelated to their ~~various~~respective day-to-day functional ~~areas,~~areas. These management committees meet regularly and ~~regularly~~ report their results to the ~~appropriate~~full Board committees and the entire Board. Our Management Investment Committee reports directly to our Investment Committee; our Governance Risk and Compliance Oversight Committee reports directly to our Audit Committee; and our Benefits Committee reports directly to our Compensation Committee.of Directors or applicable committee.

~~Both the Audit Committee and the Compensation Committee of the Board~~We also rely on the advice and counsel of our independent auditors and independent compensation consultant, respectively, to raise awareness of any risk issues that may arise during their regular reviews of the Company’s financial statements, audit work and executive compensation policies and practices, as applicable.

~~Finally, we~~ have robust internal dialog amongst our operations, finance, treasury, tax, legal and internal audit departments, among others, whenever a potential risk ~~arises, and any such~~arises. These discussions are escalated to our CEO, CFO, Chief ~~Financial~~Operating Officer, ~~or CFO, Vice President and~~Chief Compliance Officer, General Counsel, Chief Human Resources Officer, ~~Vice President and~~ Chief ~~Technology~~Innovation Officer, or Vice President, Internal Audit, as appropriate, with open lines of communication among them, the various management committees described above, the various committees of the Board and the entire Board.

We believe that the Board’s approach toand continued evaluation of its risk oversight, as described above, optimizes its ability to assess the various risks, make informed cost-benefit decisions, and approach emerging risks in a proactive manner for ~~the Company.~~Diebold. We also believe that our ~~board~~Board leadership structure complements our risk management structure asbecause it allows our independent directors ~~through the four fully independent committees,~~ to exercise effective oversight of the actions of management in identifying risks and implementing effective risk management policies and controls.

Board Committees and Composition

~~During 2009,~~The Board’s current standing committees are the Board held seven meetings, in person or telephonically. All of our current directors attended 75% or more of the aggregate of all meetings of the Board and the Board committees on which they served during the period. During 2009, the Board had four standing committees: Audit Committee, Board Governance Committee, Compensation Committee and Investment Committee. In addition, in 2010, the Board formed a Special Committee to oversee the Board’s legal representative in connection with our previously disclosed global Foreign Corrupt Practices Act, or FCPA, review. In January 2013, following Mr. Swidarski’s departure, the Board also formed a CEO Search Committee to identify and evaluate potential CEO candidates. Below is a summary of our committee structure and membership ~~information during 2009:~~information:

Table of Contents

^{_______________________________________________________}


¹	Mr. Allender moved off of the Compensation Committee, and on to the Audit and Board Governance Committees, effective as of April 26, 2012. In addition, he assumed the Chair of our Audit Committee upon Mr. Wallace’s appointment as our Executive Chairman of the Board, effective as of January 19, 2013.


¹²		Mr. ~~Bockius~~Cheng is not standing for reelection at the 2013 Annual Meeting.


³	Mr. Lassiter retired from the Board effective as of the April 2012 Annual Meeting of Shareholders.


⁴	Mr. Lauer will be retiring from the Board and not standing for reelection at the 2013 Annual Meeting.


⁵	Mr. Soin was elected to the Board at the 2012 Annual Meeting of Shareholders ~~held in~~and appointed to the Compensation Committee effective as of April ~~2009.~~26, 2012.


²⁶		In 2012, Mr. ~~Cheng joined the Board~~Wallace served as Chair of our Audit Committee, but stepped down from that position and from the Audit Committee effective ~~as of August 1, 2009.~~
³		~~Mr. Cox~~January 19, 2013, when he was ~~named~~appointed Executive Chairman of the ~~Compensation Committee as of April 23, 2009, following Mr. Lassiter’s move to the Audit Committee.~~
⁴		~~Mr. Lassiter served as Chairman of the Compensation Committee until April 23, 2009, at which time he stepped down from the Compensation Committee and joined the Audit Committee.~~
⁵		~~Mr. Roorda served on the Audit and Investment Committees until April 23, 2009, at which time he stepped down from those committees and joined the Compensation and Board Governance Committees.~~Board.

Audit Committee

This committee is a separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934, or the Exchange Act, and its functions are described below under “Report of Audit Committee.” The committee’s current charter is available on our web site athttp://www.diebold.com.

The current members of the Audit Committee are ~~Henry D. G. Wallace,~~Patrick W. Allender, Chair (effective as of January 19, 2013), Bruce L. Byrnes, Mei-Wei Cheng, ~~Richard L. Crandall, Phillip B. Lassiter~~ and Alan J. Weber, all of whom are independent. In addition, the Board has determined that Messrs. ~~Wallace~~Allender and Weber are audit committee financial experts. During 2012, Mr. Wallace served as Chair of the Audit Committee, but effective as of January 19, 2013, when he was appointed Executive Chairman of the Board, he stepped down as Chair and as a member of the Audit Committee. This committee met in person or telephonically ~~seven~~eight times during ~~2009,~~2012, and had informal communications between themselves and management, as well as with our independent auditors, at various other times during the year.

Board Governance Committee

This committee’s functions include reviewing the qualifications of potential director candidates and making recommendations to the Board to fill vacancies or ~~to expand~~consider the appropriate size of the ~~Board, when appropriate.~~Board. This committee ~~also~~ makes recommendations ~~as to~~regarding corporate governance principles, the composition of the ~~various~~Board committees, ofand the ~~Board,~~directors’ compensation ~~paid to the directors~~ for their services on the Board and on Board ~~committees,~~committees. This committee also leads the Board’s annual self-assessment, and ~~develops~~oversees director orientation and ~~recommends corporate governance principles.~~education, as described in “Director Orientation and Education” below. Finally, as noted in “Board Risk Oversight” above, in 2012 this committee assumed the primary oversight of enterprise risk management generally and of the DRC. The committee’s current charter is available on our web site athttp://www.diebold.com.

The current members of the Board Governance Committee are Gale S. Fitzgerald, Chair, ~~Phillip B. Lassiter,~~Patrick W. Allender, Bruce L. Byrnes, Mei-Wei Cheng, and John N. Lauer, ~~and Eric J. Roorda,~~ all of whom are independent. This committee met in person or telephonically ~~five~~six times during ~~2009.~~2012.

Table of Contents

Compensation Committee

This committee administers our executive pay program. The committee may, in its discretion, delegate all or a portion of its duties and responsibilities to a subcommittee or, in the case of non-officers, to the CEO or the Chief Human Resources Officer. The role of the committee is to oversee our equity plans (including reviewing and approving equity grants to executive officers) and to annually review and approve all pay decisions relating to executive officers. This committee also assesses achievement of corporate and individual goals, as applicable, by the executive officers under our short- (annual) and long-term incentive ~~plans.~~plans, and makes recommendations to the Board for approval of such achievement. This committee reviews the management succession plan and proposed changes to any of our benefit plans, such as retirement plans, deferred compensation plans and 401(k) plans. For a narrative description of the committee’s processes and procedures for the consideration of executive officer compensation, and for further discussion on the independence of the committee members, see “Compensation Discussion and Analysis” below. The committee’s current charter is available on our web site athttp://www.diebold.com.

The current members of the Compensation Committee are Phillip R. Cox, Chair, Richard L. Crandall, Gale S. Fitzgerald, John N. Lauer, and ~~Eric J. Roorda,~~Rajesh K. Soin, all of whom are independent. This committee met in person or telephonically ~~four~~five times during ~~2009.~~2012.

Investment Committee

This committee’s functions include establishing the investment policies, including asset allocation, for our cash, short-term securities and retirement plan assets, overseeing the management of those assets, ratifying fund managers recommended by management and reviewing at least annually the investment performance of our retirement plans and 401(k) plans to assure adequate and competitive returns. The committee’s current charter is available on our web site athttp://www.diebold.com.

The current members of the Investment Committee are Alan J. Weber, Chair, Phillip R. Cox, Richard L. Crandall and Henry D. G. Wallace. This committee met ~~one time~~once in ~~2009.~~2012.

Special Committee

This committee’s functions are to oversee the Board’s legal representative in connection with our previously disclosed global FCPA review. The committee has the authority to retain independent counsel, and may conduct any interviews with officers, employees and/or directors of the company and access all information of the company or our subsidiaries that it believes will assist in its activities.

The current members of the Special Committee are Henry D. G. Wallace, Chair, Phillip R. Cox, Gale S. Fitzgerald and Alan J. Weber. This committee met in person or telephonically five times in 2012.

CEO Search Committee

This Committee was formed immediately following Mr. Swidarski’s departure from the company in January 2013 in order to begin the process of hiring a permanent CEO. This committee’s functions include identifying and evaluating potential CEO candidates, and ultimately advising the Board on its recommendations for hiring a CEO. This committee is also responsible for preparing a development plan for George S. Mayes, Jr., as a result of his appointment as Executive Vice President and Chief Operating Officer in January 2013, and his management team.

The members of this committee are Richard L. Crandall, Chair, Phillip R. Cox and Rajesh K. Soin.

Director Independence

The Board ~~has~~ determined that each of Patrick W. Allender, Bruce L. Byrnes, Mei-Wei Cheng, Phillip R. Cox, Richard L. Crandall, Gale S. Fitzgerald, ~~Phillip B. Lassiter,~~ John N. Lauer, ~~Eric J. Roorda, Henry D. G. Wallace~~Rajesh K. Soin and Alan J. Weber, which includes each of the ~~current~~ members of the Audit Committee, the Board Governance Committee and the Compensation Committee, has no material relationship with ~~the Company~~Diebold (either directly or as a

partner, shareholder or officer of an organization that has a relationship with ~~the Company)~~us) and is independent within our director independence standards, which reflect the ~~New York Stock Exchange, or~~ NYSE director independence standards as currently in effect.

In making this determination with respect to Mr. Crandall, the Board determined that the provision of our printing services related to our proxy statement provided by R.R. Donnelley & Sons Company, the board of directors of which Mr. Crandall is a member, did not create a material relationship or impair the independence of Mr. Crandall because he serves only as a board member, and the nature of the services provided and the fees paid by Diebold for such services were less than $25,000 in 2012.

InFurther, in making this determination with respect to Mr. Weber, the Board determined that the provision of our proxy processing, mailing and tabulation services by Broadridge Financial Solutions, Inc., the board of directors of which Mr. Weber is a member, did not create a material relationship or impair the independence of Mr. Weber because he serves only as a board member, ~~of such board,~~ and the nature of the services provided and the fees paid by ~~the Company~~Diebold for such services were less than ~~$100,000~~$90,000 in ~~2009.~~

2012.

Under our director independence standards, a director will be determined not to be independent under the following circumstances:

The director is, or has been within the last three years, an employee of ours, or an immediate family member is, or has been within the last three years, an executive officer of ours;


•	~~The director is, or has been within the last three years, an employee of ours, or an immediate family member is, or has been within the last three years, an executive officer, of ours;~~

•	~~The director has received, or has an immediate family member who has received, during any12-month~~ period within the last three years, more than $120,000 in direct compensation from us, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service);

•	(a) The director is a current partner or employee of a firm that is our internal or external auditor; (b) the director has an immediate family member who is a current partner of such a firm; (c) the director has an immediate family member who is a current employee of such a firm and personally works on our audit; or (d) the director has been, or a member of his or her immediate family has been, a partner or employee of such a firm and personally worked on our audit during the last three years;

•	The director or an immediate family member is, or has been within the last three years, employed as an executive officer of another company where any of our present executive officers at the same time serves or served on that company’s compensation committee;

•	The director is a current employee, or an immediate family member is a current executive officer, of a company that has made payments to, or received payments from, us for property or services in an amount which, in any of the last three fiscal years, exceeds the greater of $1 million, or two percent of such other company’s consolidated gross revenues;

•	~~The director has engaged in a transaction with us for which we have been or will be required to make a disclosure under Item 404(a) ofRegulation S-K~~ ~~promulgated by the SEC; or~~

•	The director has received, or has an immediate family member who has received, during any 12-month period within the last three years, more than $120,000 in direct compensation from us, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service); The director has been affiliated with or employed by, or any of his or her immediate family members has been affiliated with or employed in a professional capacity by, a present or former internal or external auditor of the company during the last three years; The director or an immediate family member is, or has been within the last three years, employed as an executive officer of another company where any of our present executive officers at the same time serves or served on that company’s compensation committee; The director is a current employee, or an immediate family member is a current executive officer, of a company that has made payments to, or received payments from, us for property or services in an amount which, in any of the last 7 Table of Contents three fiscal years, exceeds the greater of $1 million, or two percent of such other company’s consolidated gross revenues; The director has engaged in a transaction with us for which we have been or will be required to make a disclosure under Item 404(a) of Regulation S-K promulgated by the SEC; or The director has any other material relationship with us, either directly or as a partner, shareholder or officer of an organization that has a relationship with us.

Thomas W. Swidarski, ~~does~~who was a member of our Board in 2012, did not meet ~~the aforementioned~~these independence standards because he iswas our President and CEO, and is our ~~employee.~~employee, through January 19, 2013. Further, Mr. Wallace does not currently meet these standards as our current Executive Chairman of the Board, effective January 19, 2013; however, Mr. Wallace will regain his independent status and become a non-executive director once we hire a permanent CEO.

Our director independence standards are available on our web site athttp://www.diebold.com.

Related Person Transaction Policy

~~In addition, except for employment arrangements with the Chief Executive Officer~~Pursuant to our director independence standards, discussed above, and ~~other management directors that may be on the~~ our Corporate Governance Guidelines, discussed below in “Board ~~from time to time,~~Diversity, Director Qualifications and Corporate Governance Guidelines,” we do not engage in transactions with non-employee directors or their affiliates if a transaction would cause an independent director to no longer be deemed independent, would present the appearance of a conflict of interest or is otherwise prohibited by law, rule or regulation. This includes, directly or indirectly, any extension, maintenance or renewal of an extension of credit to any of our directors.

This prohibition also includes significant business dealings with directors or their affiliates, charitable contributions ~~which~~that would require disclosure in our proxy statement under the rules of the NYSE, and consulting contracts with, or other indirect forms of compensation to, a director. Any waiver of this policy may be made only by the Board and must be promptly disclosed to our shareholders.

Both the director independence standards and our Corporate Governance Guidelines are available on our website at www.diebold.com.

In 2012, we did not engage in any related person transaction(s) requiring disclosure under Item 404 of Regulation S-K.

Communications with Directors

In accordance with the NYSE’s corporate governance standards, our non-management directors meet at regularly scheduled executive sessions without management present. Our Chairman of the Board, John N. Lauer, is an independent director and presides at these sessions. Shareholders and interested parties

may communicate with our committee chairs or with our ~~non-management~~non-employee directors as a group, by sending an email to:

Audit Committee – auditchair@diebold.com


•	~~Audit Committee -auditchair@diebold.com~~


•	~~Board Governance Committee -bdgovchair@diebold.com~~

•	~~Compensation Committee -compchair@diebold.com~~


•	~~Directors -nonmanagementdirectors@diebold.com~~

~~Communication~~

Table of Contents

Board Governance Committee – bdgovchair@diebold.com

Compensation Committee – compchair@diebold.com

Directors – nonmanagementdirectors@diebold.com

Communications may also be directed in writing to such person or group at Diebold, Incorporated, Attention: ~~Corporate~~ Secretary, 5995 Mayfair Road, P.O. Box 3077, North Canton, Ohio44720-8077. The Board has approved a process for handling communications received by the ~~Company~~company and addressed to ~~non-management~~non-employee members of the Board. Under that process, the ~~Corporate~~ Secretary will review all such communications and determine whether ~~such~~ communications require immediate attention. The ~~Corporate~~ Secretary will forward ~~such~~ communications, or a summary of ~~such~~ communications, to the appropriate director or directors.

A majority of the independent directors of the Board approved ~~the above-described~~this process for determining which communications are forwarded to various members of the Board.

Code of Business Ethics ~~Policy~~

All of our directors, executive officers and employees are required to comply with certain policies and protocols concerning business ethics and ~~conduct, which~~conduct. Effective November 21, 2012, we ~~refer to as our~~implemented a new Code of Business Ethics, ~~Policy.~~

Our Code applies not only to the ~~Company,~~company, but also to all of ~~those~~our domestic and international ~~companies which we own or in which we control a majority interest.~~affiliates and subsidiaries. The ~~Business Ethics Policy~~Code describes certain responsibilities that our directors, executive officers and employees have to ~~the Company,~~Diebold, to each other and to our global partners and ~~communities~~communities. It covers many topics, including ~~but not limited to,~~ compliance with laws, conflicts of interest, intellectual property and the protection of competitive and confidential ~~information.~~information, as well as maintaining a respectful and non-retaliatory workplace. The Code also includes and links to our Conflicts of Interest Policy, which further details the requirements for our officers, directors and employees to avoid and disclose potential conflicts, including those that may result from related-party transactions. In addition, our employees are required to report any conduct that they believe in good faith to be a violation of our Code. Our Audit Committee has procedures to receive, retain and treat complaints received regarding accounting, internal financial controls or auditing matters, and to allow for the confidential and anonymous submission of concerns regarding questionable practices or potential violations of our policies, including our Code.

The Code of Business Ethics ~~Policy~~ is available on our web site athttp://~~www.diebold.com.~~www.diebold.com.

Compensation Committee Interlocks and Insider Participation

~~2009~~ Director Orientation and Education

All new directors participate in a director orientation program. The Board Governance Committee oversees this introduction and orientation process where the new director meets with key senior management personnel and takes a tour of the company to thoroughly understand our business. In addition, the orientation process educates the new director on our strategic plans, significant financial matters, core values, including ethics and compliance programs, corporate governance practices, and other key policies and practices.

COMPENSATION OF ~~NON-EMPLOYEE~~ DIRECTORS

The following ~~table details~~director compensation is determined by the ~~cash retainers and fees received by our~~Board at the recommendation of the Board Governance Committee. With respect to non-employee directors, ~~during 2009, as well as~~it is the ~~aggregate grant date~~company’s goal to provide directors with fair ~~value~~and competitive compensation, while ensuring that their compensation is closely aligned with stockholder interests and with the performance of ~~stock grants awarded during 2009 pursuant to our Amended and Restated 1991 Equity and Performance Incentive Plan, which we refer to as~~ the ~~1991 Plan:~~

company.

~~2009 Director Compensation~~During

Fees Earned or
All Other

Paid in Cash¹ Stock Awards² Compensation³ Total
Name ($) ($) ($) ($)
Louis V. Bockius III
23,000 91,840 962 115,802
Mei-Wei Cheng
26,667 97,020 1,820 125,507
Phillip R. Cox
68,333 91,840 6,578 166,751
Richard L. Crandall
67,000 91,840 6,578 165,418
Gale S. Fitzgerald
70,000 91,840 6,578 168,418
Phillip B. Lassiter
70,000 91,840 6,578 168,418
John N. Lauer
157,000 91,840 8,762 257,602
Eric J. Roorda
67,001 91,840 6,578 165,419
Henry D. G. Wallace
73,000 91,840 8,762 173,602
Alan J. Weber
69,000 91,840 6,578 167,418


2012¹		~~This column reports the amount of cash compensation earned in 2009 for Board and committee service, including the following committee fees earned in 2009:~~

Audit
Board Governance
Compensation
Investment
Name Committee Committee Committee Committee
Louis V. Bockius III $ 3,000 $ 1,667 $ — $ —
Mei-Wei Cheng 3,750 — — —
Phillip R. Cox — — 10,333 3,000
Richard L. Crandall 9,000 — — 3,000
Gale S. Fitzgerald — 8,000 7,000 —
Phillip B. Lassiter 6,000 5,000 4,000 —
John N. Lauer — 5,000 7,000 —
Eric J. Roorda 3,000 3,334 4,667 1,000
Henry D. G. Wallace 15,000 — — 3,000
Alan J. Weber 9,000 — — 5,000


²		This column represents the aggregate grant date fair value computed in accordance with Financial Accounting Standards Board (or FASB) ASC Topic 718 for deferred shares granted to our non-employee directors in 2009, as further described below. Each director received 3,500 deferred shares as of April 23, 2009 (except Mr. Cheng who received 3,500 deferred shares when he joined the Board as of August 1, 2009), with a closing price of our Common Shares on that date of $26.24 ($27.72 for Mr. Cheng). The actual value a director may realize will depend on the stock price on the date the deferral period ends. As of December 31, 2009, the aggregate number of deferred shares outstanding held by each non-employee director was as follows: Mr. Cheng, 3,500; Mr. Cox, 7,200; Mr. Crandall, 7,200; Ms. Fitzgerald, 7,200; Mr. Lassiter, 7,200; Mr. Lauer, 9,300; Mr. Roorda, 7,200; Mr. Wallace, 9,300; and Mr. Weber, 7,200. In addition, as of December 31, 2009, the aggregate number of Common Shares issuable pursuant to options outstanding held by each non-employee director was as follows: Mr. Bockius, 17,500; Mr. Cox, 9,000; Mr. Crandall, 21,500; Ms. Fitzgerald, 21,500; Mr. Lassiter, 21,500; Mr. Lauer, 18,500; Mr. Roorda, 25,500; Mr. Wallace, 17,500; and Mr. Weber, 9,000.

³		~~This column represents dividend equivalents on deferred shares.~~

~~In 2009,~~ our non-employee directors received an annual retainer of ~~$55,000~~$65,000 for their service as ~~directors. Our non-employee~~directors, and our Chairman of the Board received an additional retainer of $7,500 per month.

In addition to their annual ~~retainer,~~retainers, our non-employee directors also received the following annual committee fees for their participation as members or as Chairs of one or more Board committees:


	~~Members~~		~~Chair~~

~~Audit Committee~~	$	~~9,000/yr.~~	$	~~15,000/yr.~~
~~Compensation Committee~~	$	~~7,000/yr.~~	$	~~12,000/yr.~~
~~Board Governance Committee~~	$	~~5,000/yr.~~	$	~~8,000/yr.~~
~~Investment Committee~~	$	~~3,000/yr.~~	$	~~5,000/yr.~~



	Member		Chair
Audit Committee	$	11,000	$	15,000
Compensation Committee	$	7,000	$	12,000
Board Governance Committee	$	5,000	$	8,000
Investment Committee	$	3,000	$	5,000

Additionally, members of the Special Committee also received $1,500 for each Special Committee meeting held and the Chair of the Special Committee received a $10,000 annual retainer in addition to the per meeting fee.

The ~~differences in fees between the committees and between the committee members and Chairs~~varying fee amounts are intended to reflect differing levels of responsibility, meeting requirements and fiduciary duties. The fees for a director who joins or leaves the Board or assumes additional responsibilities during the year are pro-rated for his or her period of actual service.

A director may elect to defer receipt of all or a portion of his or her cash compensation pursuant to the Deferred Compensation Plan No. 2 for Directors.

In addition to cash compensation, each non-employee director may also receive equity awards under our Amended and Restated 1991 Equity and Performance Incentive Plan, which we refer to as the 1991 Plan. The aim of the Board is to provide a balanced mix of cash and equity compensation to our directors, ~~and it~~which mix targets the directors’ total pay at the median of a peer group of companies in similar industries and of comparable size and revenue. This peer group is the same one used by our Compensation Committee ~~and~~for benchmarking executive compensation, which is discussed in more detail below in “Peer Companies and Competitive Market Data” under “~~Market Benchmarking of Executive Pay~~Compensation Discussion and Analysis.”

Prior to 2007, our non-employee directors received stock option awards under the 1991 Plan. ~~All such~~Those stock options that vested prior to December 31, 2005 are entitled to reload rights, under which an optionee can elect to pay the exercise price using previously owned shares and receive a new option at the then-current market price for a number of shares equal to those surrendered. The reload feature is only available, however, if the optionee agrees to defer receipt of the balance of the option shares for at least two years.

InBeginning in 2007, ~~however, the Board decided to shift from~~our non-employee directors were awarded deferred common shares instead of stock ~~option awards to~~options. The deferred ~~Common Shares, which~~shares vest one year from the date of grant, but receipt ~~of which~~ is deferred until the ~~later~~latest of (1) three years from the date of grant, (2) retirement from the Board or (3) attainment of the age of 65. ~~The decision to shift to~~We believe deferred shares ~~was intended to~~ strengthen the directors’ ties to shareholder interests by providing awards that more effectively build stock ownership and ensure that the directors’ long-term economic interests are aligned with those of other shareholders.

In ~~2009,~~2012, each non-employee director was awarded ~~3,500~~2,850 deferred ~~Common Shares.~~common shares.

The following table details the cash retainers and fees received by our non-employee directors during 2012, as well as the aggregate grant date fair value of stock grants awarded during 2012 pursuant to our 1991 Plan:

Table of Contents

2012 Director Compensation



Name	Fees Earned or Paid in Cash¹($)	Stock Awards² ($)	All Other Compensation³ ($)	Total ($)
Patrick W. Allender	77,999	115,539	5,971	199,509
Bruce L. Byrnes	81,000	115,539	9,163	205,702
Mei-Wei Cheng	81,000	115,539	13,153	209,692
Phillip R. Cox	87,500	115,539	17,371	220,410
Richard L. Crandall	75,000	115,539	17,371	207,910
Gale S. Fitzgerald	87,500	115,539	17,371	220,410
Phillip B. Lassiter⁴	27,001	—	12,882	39,883
John N. Lauer	167,000	115,539	19,765	302,304
Rajesh K. Soin	48,000	115,539	2,437	165,976
Henry D. G. Wallace	100,500	115,539	19,765	235,804
Alan J. Weber	88,500	115,539	17,371	221,410


¹	This column reports the amount of cash compensation earned in 2012 for Board and committee service, including Board retainer amounts discussed above and the following committee fees earned in 2012 (partial amounts reflect pro-rated fees based on time of actual Committee service during 2012):



Name	Audit Committee ($)	Board Governance Committee ($)	Compensation Committee ($)	Investment Committee ($)	Special Committee ($)
Patrick W. Allender	7,333	3,333	2,333	—	—
Bruce L. Byrnes	11,000	5,000	—	—	—
Mei-Wei Cheng	11,000	5,000	—	—	—
Phillip R. Cox	—	—	12,000	3,000	7,500
Richard L. Crandall	—	—	7,000	3,000	—
Gale S. Fitzgerald	—	8,000	7,000	—	7,500
Phillip B. Lassiter	3,667	1,667	—	—	—
John N. Lauer	—	5,000	7,000	—	—
Rajesh K. Soin	—	—	4,667	—	—
Henry D. G. Wallace	15,000	—	—	3,000	17,500
Alan J. Weber	11,000	—	—	5,000	7,500

This column represents the aggregate grant date fair value computed in accordance with Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or ASC, Topic 718 for deferred shares granted to our non-employee directors in 2012, as further described above. Each director received 2,850 deferred shares as of April 26, 2012, with a closing price of our common shares on that date of $40.54. The actual value a director may realize will depend on the stock price on the date the deferral period ends. As of December 31, 2012, the aggregate number of deferred shares held by our current directors was: Mr. Allender, 5,950; Mr. Byrnes, 8,750; Mr. Cheng, 12,250; Mr. Cox, 15,950; Mr. Crandall, 15,950; Ms. Fitzgerald, 15,950; Mr. Lauer, 18,050; Mr. Soin, 2,850; Mr. Wallace, 18,050; and Mr. Weber, 15,950. In addition, as of December 31, 2012, the aggregate number of common shares issuable pursuant to options outstanding held by current directors was: Mr. Cox, 9,000; Mr. Crandall, 17,500; Ms. Fitzgerald, 17,500; Mr. Lassiter, 17,500; Mr. Lauer, 16,500; Mr. Wallace, 17,500; and Mr. Weber, 9,000.


³	This column represents dividend equivalents on deferred shares.


⁴	Mr. Lassiter retired from the Board effective as of the 2012 Annual Meeting of Shareholders.

Director Stock Ownership Guidelines

In 2007, the Board Governance Committee established stock ownership guidelines for each non-employee ~~director of the Company.~~director. Under the ownership guidelines, each non-employee director is expected to own at least 6,500 ~~Common Shares.~~common shares. These ownership guidelines are intended to build stock ownership among non-employee directors and ensure that their long-term economic interests are aligned with those of other shareholders. As reflected below under ~~the~~ “Security Ownership of Directors and Management,” ~~table,~~ the majority of our directors have exceeded the ownership guidelines, while our directors who were appointed most recently are on track to achieve the ownership guidelines within the next few years. ~~However, we~~We do not impose any penalties on directors who fail to meet the stock ownership guidelines.

Table of Contents

CONSIDERATION OF DIRECTOR-NOMINEES

Shareholder Nominees

The policy of the Board Governance Committee is to consider properly submitted shareholder nominations for candidates for membership on the Board as described below under “Identifying and Evaluating Nominees for Directors.” In evaluating ~~such~~shareholder nominations, the Board Governance Committee seeks to achieve a balance of knowledge, experience and capability on the Board and to address the membership criteria set forth below under “Board Diversity, Director Qualifications and Corporate Governance Guidelines.”

Any shareholder nominations proposed for consideration by the Board Governance Committee should include:


•	~~complete information as to the identity and qualifications of the proposed nominee, including name, address, present and prior business~~complete information as to the identity and qualifications of the proposed nominee, including name, address, present and prior business and/or professional affiliations, education and experience, and particular fields of expertise;

•	~~an indication of the nominee’s consent to serve as a director of the Company if elected; and~~

•	~~reasons why, in the opinion of the recommending shareholder, the proposed nominee is qualified and suited to be a director of the Company.~~

an indication of the nominee’s consent to serve as a director of Diebold if elected; and

why, in the opinion of the recommending shareholder, the proposed nominee is qualified and suited to be a director of Diebold.

Shareholder nominations should be addressed to Diebold, Incorporated, 5995 Mayfair Road, P.O. Box 3077, North Canton, Ohio44720-8077, Attention: ~~Corporate~~ Secretary. See also ~~below under~~ “Shareholder Proposals ~~of Shareholders~~.” below.

Identifying and Evaluating Nominees for Directors

The Board Governance Committee ~~utilizes a variety of~~considers many methods for identifying and evaluating ~~nominees for director.~~director-nominees. The Board Governance Committee regularly reviews the appropriate size of the Board and whether any vacancies on the Board are anticipated due to retirement or otherwise.

~~In the event that~~ When vacancies arise or are anticipated, ~~or otherwise arise,~~ the Board Governance Committee considers various potential ~~candidates for director.~~candidates. Candidates may come to the attention of the Board Governance Committee through current Board members, professional search firms, shareholders or other persons.

Specifically, in 2012, the Board Governance Committee engaged Heidrick & Struggles, a global board- and executive-level search firm, to assist with identifying potential director candidates.

As described above, the Board Governance Committee considers properly submitted shareholder nominations for candidates for the Board. Following verification of the recommending shareholder’s status, recommendations are considered by the Board Governance Committee at a regularly scheduled meeting.

Majority Voting Policy

In 2007, the Board adopted a majority voting policy ~~whereby,~~which provides that, in an uncontested election, any nominee for director who receives a greater number of votes “withheld” from his or her election than votes “for” ~~such~~ election, which we refer to as a Majority Withheld Vote, is expected to tender his or her resignation following certification of the shareholder vote. ~~In such an event, the~~The Board Governance Committee ~~shall~~will then consider the tendered resignation and make a recommendation to the Board. The Board will act on the Board Governance Committee’s recommendation within 90 days following certification of the shareholder vote. Any director who tenders his or her resignation pursuant to this policy ~~shall~~will not participate in the Board Governance Committee recommendation or Board action regarding whether to accept or reject the tendered resignation.

However, if each member of the Board Governance Committee received a Majority Withheld Vote in the same election, then the Board will appoint a committee comprised solely of independent directors who did not receive a Majority Withheld Vote at that election to consider each tendered resignation offer and recommend to the Board whether to accept or reject each resignation. Further, if all of the directors received a Majority Withhold Vote in the same election, then the Board will appoint a committee comprised solely of independent directors to consider each tendered resignation offer and recommend to the Board whether to accept or reject each resignation.

Board Diversity, Director Qualifications and Corporate Governance Guidelines

In evaluating director-nominees, the Board Governance Committee considers ~~such~~many factors as it deems appropriate, consistent with our Corporate Governance Guidelines and other criteria established by the Board. While the Board Governance Committee does not have a formal diversity policy, inits general ~~the Board Governance Committee’s~~ goal ~~in selecting directors for nomination to the Board~~ is to create a well-balanced Board team that combines diverse business and industry experience, skill sets and other leadership ~~aspects,~~skills, that ~~represents~~represent diverse viewpoints and that enables us to pursue our strategic ~~objectives.~~

objectives domestically and abroad.

The Board Governance Committee identifies candidates whose business experience, knowledge, skills, diversity, integrity and global experiences are considered desirable to strengthen the talent and capabilities of the Board and any committees ~~thereof. Such qualifications~~of the Board. Qualifications for service have not been reduced to a checklist of specific standards or minimum qualifications, skills or qualities.

Table of Contents

The Board Governance Committee makes its determinations as to director selection based ~~upon~~on the facts and circumstances at the time of the receipt of the director candidate recommendation. Applicable considerations ~~include:~~include whether:

the Board Governance Committee is currently looking to fill a new position created by an expansion of the number of directors, or a vacancy that may exist or is anticipated on the Board;


•	~~whether the Board Governance Committee is currently looking to fill a new position created~~

the current composition of the Board is consistent with the criteria described in our Corporate Governance Guidelines;


		~~by an expansion of the number of directors, or a vacancy that may exist on the Board;~~

the candidate possesses the qualifications that are generally the basis for selection of candidates to the Board; and


•	~~whether the current composition of the Board is consistent with the criteria described in our Corporate Governance Guidelines;~~

•	~~whether the candidate possesses the qualifications that are generally the basis for selection of candidates to the Board; and~~

•	~~whether~~ the candidate would be considered independent under the rules of the NYSE and our standards with respect to director independence.

Final approval of any candidate is determined by the full Board. In addition, the Board Governance Committee annually conducts a review of incumbent directors using the same criteria as outlined above, in order to determine whether a director should be nominated for ~~re-election~~reelection to the Board.

A copy of our Corporate Governance Guidelines is available on our web site athttp://www.diebold.com.

The Board Governance Committee has identified the director-nominees below as fitting the general qualifications described above, and in particular, due to the specific experience, skills and qualifications each of them would bring to the Board as set forth in more detail below.

PROPOSAL ~~NO.~~ 1: ELECTION OF DIRECTORS

The Board recommends that its ten nominees for director be elected at the2013 Annual Meeting, each to hold office for a term of one year from the date of the Annual Meeting or until the election and qualification of a successor. In the absence of contrary instruction, the Proxy Committee will vote the proxies for the election of the ten nominees.

~~With the exception of Mr. Byrnes, all~~All director-nominees are presently members of the ~~Board.~~Board, with the exception of Mr. Artavia, who was identified as a director-nominee by the Board Governance Committee, and Mr. Prather, who was properly nominated by a shareholder of the company and, after review, recommended by the Board Governance Committee. All of the present members of the Board were previously elected by our shareholders. A substantial majority of the director-nominees are independent as required by the corporate governance standards of the NYSE. While ~~the Company~~Diebold does not have a formal policy ~~about~~regarding directors’ attendance at the Annual Meeting of Shareholders, it is expected that all directors attend the Annual Meeting unless there are extenuating circumstances for nonattendance. All directors standing for ~~re-election~~reelection attended the ~~2009~~2012 Annual ~~Meeting.~~

Meeting of Shareholders, except for Mr. Soin who had a prior engagement.

If for any reason any ~~director-nominees are~~director-nominee is not available for election when the election occurs, the ~~designated proxies,~~Proxy Committee, at ~~their~~its option, may vote for substitute nominees recommended by the Board.

Alternatively, the Board may reduce the number of director-nominees. The Board has no reason to believe that any director-nominee will be unavailable for election when the election occurs.

Recommendation of the Board

~~THE BOARD RECOMMENDS A VOTE~~The board recommends a vote FOR ~~THE ELECTION OF ITS~~
~~TEN NOMINEES AS DIRECTORS.~~ the election of our ten nominees as directors.

The Director-Nominees are:



Name, Term and Age
		Position, Principal Occupation, Business Experience and Directorships
~~Name, Term and Age~~		Last Five Years, and Qualifications to Serve
~~Bruce L. Byrnes~~ Patrick W. Allender Director ~~since:~~since 2011 Age — 62 66		February 2007: Retired Executive Vice President, Chief Financial Officer and Secretary, Danaher Corporation, Washington, D.C. (diversified manufacturing); 2005 - 2007: Executive Vice President, Chief Financial Officer and Secretary, Danaher Corporation. Currently a director of Colfax Corporation, Fulton, Maryland (diversified industrial products) since 2008, where he serves as Chair of the Governance Committee and a member of the Audit Committee; and Brady Corporation, Milwaukee, Wisconsin (identification solutions) since 2007, where he serves as Chair of the Finance Committee, and a member of the Audit and Nominating Committees. Chair of our Audit Committee, and member of our Board Governance Committee. Mr. Allender’s 18 years as Chief Financial Officer of a large publicly traded company with global operations provides our Board with valuable expertise in financial reporting and risk management. In addition, as a result of Mr. Allender’s public accounting background, including as audit partner of a major accounting firm, he is exceptionally qualified to serve as Chair of our Audit Committee.



Name, Term and Age		Position, Principal Occupation, Business Experience and Directorships Last Five Years, and Qualifications to Serve
Roberto Artavia Director-nominee Age — 54		2008 - Present: Chairman and CEO of Fundación Marviva, and Chairman of Marviva Foundation, each not-for-profit organizations dedicated to the protection of marine resources in the Americas and Mid-eastern Pacific, respectively; Protector of AVINA Foundation; 2005 - Present: Board member of Copa Holdings, S.A. (airline industry). Also currently Chairman of Viva Trust, and President of Fundación Latinoamérica Posible, each dedicated to the promotion of sustainable development, integration and social responsibility in Latin America. He is also a Director and CEO of the Global Social Competitiveness Index Initiative, Inc., based in Washington, D.C. From 1999-2007, he served as Rector of INCAE Business School, a school of business with operations in 12 Latin American countries, where he served as Dean from 1994-1996. He also served as an academic researcher for Harvard Business School from 1987-2001. Mr. Artavia’s academic and philanthropic experience within the business sector is a tremendous asset, particularly in Latin America, a market where we continue to focus on growth.



Bruce L. Byrnes Director since 2010 Age — 65		July ~~2008:~~2008: Retired Vice Chairman ~~Global Brand Building Training,~~of the Board, Procter & Gamble, Inc., Cincinnati, Ohio (consumer goods);~~2004 – 2007:~~2004-2007: Vice Chairman of the Board, Household Care, Procter & Gamble, Inc. Currently a director of Cincinnati Bell Inc., Cincinnati, Ohio (telecommunications) since ~~2003;~~2003, where he serves as Chair of the Governance and Nominating Committee; Boston Scientific Corp., Natick, Massachusetts (medical devices) since ~~2009.~~2009, where he serves as Chair of the Governance and Nominating Committee, and a member of the Audit Committee; and Brown-Forman Corporation, Louisville, Kentucky (wine and spirits) since 2010, where he serves as a member of the Audit, and Governance and Nominating Committees. Formerly a director of Procter & Gamble from 2002 –- 2008. Member of our Audit and Board Governance Committees. ~~We believe~~ Mr. Byrnes’ qualifications to sit on our Board include his 2838 years in various leadership roles of an $80 billion global business, including his extensive marketing and strategy experience, and profit and revenue responsibility at Procter & Gamble. Further, as a result of Procter & Gamble’sbusiness-to-consumer focus, he ~~will bring~~brings a different perspective to our Board and ourbusiness-to-business focus.


		~~Position, Principal Occupation, Business Experience and Directorships~~
~~Name, Term and Age~~		~~Last Five Years, and Qualifications to Serve~~
~~Mei-Wei Cheng~~ ~~Director since: 2009~~ ~~Age — 60~~		~~2008 – April 2009: Retired Group Vice President, Ford Motor Company, and Executive Chairman, Ford Motor (China), Ltd. (automotive industry);1998 – 2008:~~ ~~Chairman and Chief Executive Officer, Ford Motor (China) Inc.~~ ~~Member of our Audit Committee.~~ We believe Mr. Cheng’s experience as Chief Executive Officer of a major division of a $100+ billion global manufacturing company, including extensive experience in Asia Pacific, and China in particular, has been and will continue to be a tremendous asset to us as we continue to focus on growth in that key region. We also believe that Mr. Cheng’s experience in Asia Pacific provides an important perspective on potential risk exposure in this region to our Audit Committee.

Phillip R. Cox Director ~~since:~~since 2005 Age — 62 65		1972 – Present: President and Chief Executive Officer, Cox Financial Corporation, Cincinnati, Ohio (financial planning and wealth management services). ~~Chair of our Compensation Committee and member of our Investment Committee.~~ Currently ~~also~~ a director of Cincinnati Bell Inc., Cincinnati, Ohio (telecommunications) since 1993, where he has served as Chairman of the Board since ~~2003;~~2003 and where he serves as a member of the Audit and Finance, Compensation, and Governance and Nominating Committees; The Timken Company, Canton, Ohio (engineered steel products) since 2004, where he has served as ~~Chairman~~member of the Audit Committee since 2004, and served as Chair of the Finance Committee ~~since 2008;~~from 2004 – 2011; and Touchstone Investments, Cincinnati, Ohio (mutual fund company) since 1993, where he has served as Chairman of the Board since 2008. Formerly a director of Duke Energy Corporation/Cinergy Corporation (gas and electric) from 1994 – ~~2008, where he served as Chairman~~2008. Chair of ~~the Audit~~our Compensation Committee ~~from 2006 – 2008.~~and member of our Investment and CEO Search Committees. ~~We believe~~ Mr. Cox’s 38 ~~years’~~years of experience as a president and Chief Executive Officer in the financial services industry, as well as his experience as a ~~dir ector~~director on the boards of several government-regulated businesses, a global manufacturing company, and the Federal Reserve Bank of Cleveland, ~~has provided and will continue to provide~~provides the Board with experience relevant to many key aspects of our business. ~~We also believe that~~ Mr. Cox’s experience as a Chief Executive Officer ~~provides~~also imparts appropriate insight into executive compensation and succession planning issues that are ideal for the Chairman of our Compensation Committee, and his extensive experience in the financial services industry provides the understanding necessary to serve on our Investment Committee.



Name, Term and Age
		Position, Principal Occupation, Business Experience and Directorships
~~Name, Term and Age~~		Last Five Years, and Qualifications to Serve
Richard L. Crandall Director ~~since:~~since 1996 Age — 66 69		~~May 2008~~2001 – Present: ~~Non-executive Chairman of the Board, Novell, Inc., Waltham, Massachusetts (IT management software)~~Managing Partner, Aspen Venture LLC, Aspen, Colorado (venture capital and private equity);2007 – Present: Executive Chairman, Pelstar LLC, Chicago, Illinois (medical equipment manufacturing and sales);~~2002 – Present: Managing Partner, Aspen Partners LLC, Aspen, Colorado (private equity);~~1995 – Present: Chairman, Enterprise Software Roundtable, Aspen, Colorado (CEO roundtable for software industry). ~~Member~~Currently a director of ~~our Audit~~R.R. Donnelley Inc., Chicago, Illinois (interactive communications provider) since January 2012, where he serves as a member of the Governance Committee, and ~~Investment Committees.~~ ~~Currently~~Platinum Energy Solutions (energy services) since January 2012, where he serves as Chair of the Governance Committee. Formerly a director of Novell, Inc. ~~since~~(infrastructure software) from 2003 – 2011, where he ~~has~~ served as Chairman of the Board ~~since 2008;~~from 2008 – 2011, and Claymore Dividend & Income Fund, Lisle, Illinois (management investment company) ~~since 2004.~~from 2004 – 2010. ~~We believe~~ Member of our Compensation and Investment Committees, and Chair of our CEO Search Committee. Mr. Crandall’s extensive experience as an entrepreneur, leader and Board member with several companies in the information technology and technology fields, and in the financial industry, including serving as chairman of a $900 million ~~dollar~~ global information technology business, ~~will bring~~brings diversity of thought to our Board. Further, during his 1416 years on our Board, Mr. Crandall has provided ~~and will continue to provide~~ immeasurable assistance to our technology-driven businesses. ~~We also believe that~~ Mr. Crandall’s background in the financial services industry also provides important financial and investment expertise to our Audit and Investment Committees, and his information technology experience provides perspective on technology risks facing the company.

Gale S. Fitzgerald Director ~~since:~~since 1999 Age — 59 62		December 2008: Retired President and Director, TranSpend, Inc., Bernardsville, New Jersey (total spend optimization). Currently a director of Health Net, Inc., Woodland Hills, California (managed healthcare) since 2001, where she serves as Chair of the Finance Committee and a member of the Audit Committee; and Cross Country Healthcare, Inc. Boca Raton, Florida (healthcare staffing) since 2007 where she serves as a member of the Audit Committee. Chair of our Board Governance Committee and member of our Compensation Committee. ~~Currently a director of Health Net, Inc. (managed healthcare) since 2001, where she serves as Chair of the Compensation Committee; and Cross Country Healthcare, Inc. (healthcare staffing) since 2007.~~ ~~We believe~~ Ms. Fitzgerald’s international experience as a Chief Executive Officer in the information technology industry, a Chief Executive Officer of a business unit of International Business Machines, and the President and Chief Executive Officer of two privately-held consulting companies bring a well-rounded and diverse perspective to our Board ~~discussions. Further, during her 11 years on our Board, Ms. Fitzgerald has provided~~discussions and ~~will continue to~~ provide significant insight in ~~these areas. We also believe~~critical areas that impact our company, including information technology, supply chain management, procurement solutions, human resources, strategic planning and operations management. Ms. Fitzgerald’s service on the Compensation Committee of Health Net also brings valuable experience with compensation and succession planning issues to our Compensation Committee, and her 20 years of multiple board experiences ~~bring~~provides a unique point of view to our Board Governance Committee.


Robert S. Prather, Jr. Director-Nominee Age 68		1992 – Present: President and Chief Operating Officer, Gray Television, Inc. (television broadcast). Mr. Prather currently serves as lead independent director of GAMCO Investors, Inc. (asset management and financial services). Previously, Mr. Prather served as director of Bull Run Corporation (sports marketing and management), Draper Holdings Business Trust (television broadcasting trust), and Ryman Hospitality Properties, Inc. (real estate investment trust). Mr. Prather brings significant acumen to the Board as a result of his extensive, broad-based business background, and critical leadership and Board roles in diverse industries. Particularly, Mr. Prather’s long-term experience within the financial and investment services market will bring valuable insight to the Board. In addition, his knowledge and familiarity with the specific needs of companies within regulated industries will further strengthen the proficiency of our Board in that area.



Name, Term and Age		Position, Principal Occupation, Business Experience and Directorships
~~Name, Term and Age~~		Last Five Years, and Qualifications to Serve
~~Phillip B. Lassiter~~ Rajesh K. Soin Director ~~since: 1995~~ since 2012 Age — 66 64		~~July 2006~~1998 – Present: ~~Retired~~ Chairman of the Board and Chief Executive Officer, Soin International LLC, Beavercreek, Ohio (IT and Management Consulting Services); 2002 - 2008: Chairman of the Board and Chief Executive Officer, MTC Technologies, Inc. (military defense systems). Member of our Compensation and CEO Search Committees. Mr. Soin’s experience as an entrepreneur is a tremendous asset. Mr. Soin has extensive experience in India, where we continue to focus on growth in that emerging market, and his engineering and software development background brings additional technical expertise to our Board. Further, Mr. Soin’s significant government contracting experience as the founder and Chairman of MTC Technologies, a NASDAQ listed company before being acquired by BAE Systems, provides additional perspective in helping us grow our security business.

Henry D.G. Wallace Director since 2003 Age — 67		January 2013 – Present: Executive Chairman of the Board, Diebold, Incorporated; December 2001: Former Group Vice President and Chief Financial Officer, Ford Motor Company, Dearborn, Michigan (automotive). Currently a director of Ambac Financial Group, Inc., New York, New York (financial guarantee insurance holding company). ~~Member~~ since 2004, where he serves as a Lead Independent Director, and member of ~~our~~the Audit and ~~Board~~Risk Assessment, Governance ~~Committees~~ ~~Formerly a director of Ambac Financial Group, Inc. from 2001 – 2007,~~and Compensation Committees; and Lear Corporation, Southfield, Michigan (automotive components) since 2005, where he has served as non-executive Chairman of the Board ~~from 2004 – 2006;~~since August 2010 and ~~Fidelity National Information Services, Inc./Certegy, Inc. (financial services and payment systems) from 2002 – 2006.~~ ~~We believe Mr. Lassiter’s 13 years of experience~~where he serves as a ~~Chief Executive Officer in~~member of the ~~financial services industry, including six years~~Governance & Nominating, and Compensation Committees. Mr. Wallace also served as ~~a board chairman~~director of Hayes Lemmerz International Inc. (steel and 22 years as a senior bank executive, bring an important understanding of our industry. Further, during his 15 years on our Board, Mr. Lassiter has provided and will continue to provide, demonstrated leadership to our Board and a vital perspectivealuminum wheels) from a former customer’s standpoint. We also believe t hat Mr. Lassiter’s extensive background as a Chief Executive Officer in the financial services industry provides the necessary financial acumen to serve on our Audit Committee, and his experience as a board chairman is ideal for service on our Board Governance Committee.

~~John N. Lauer~~ ~~Director since: 1992~~ ~~Age — 71~~2003 until February 2012.		~~2005 – Present: Non-executive~~Executive Chairman of the Board ~~Diebold, Incorporated, Canton, Ohio;May 2003: Retired Chairman of the Board, Oglebay Norton Co. (industrial minerals), Cleveland, Ohio.~~ ~~Member of our Board Governance and Compensation Committees.~~ We believe that Mr. Lauer’s experience as a former Chief Executive Officer of a global manufacturing company, with extensive experience in Europe and Asia Pacific, brings directly relatable experience to our Board. Further, during his 18 years on our Board, Mr. Lauer has provided and will continue to provide demonstrated leadership to our Board. We also believe that Mr. Lauer’s background as a board chairman of two global corporations brings significant corporate governance experience to our Board Governance Committee, and his experience as a Chief Executive Officer of a global manufacturing company brings an understanding of global compensation issues to our Compensation Committee.

~~Thomas W. Swidarski~~ ~~Director since: 2005~~ ~~Age — 51~~		~~2005 – Present: President and Chief Executive Officer, Diebold, Incorporated, Canton, Ohio;June 2005 – December 2005: President and Chief Operating Officer;2001 – 2005: Senior Vice President, Global Financial Self-Service.~~ ~~We believe that as President and Chief Executive Officer of Diebold, Mr. Swidarski’sday-to-day~~ ~~leadership provides him with intimate knowledge of our operations that are a vital component of our Board discussions.~~


		~~Position, Principal Occupation, Business Experience and Directorships~~
~~Name, Term and Age~~		~~Last Five Years, and Qualifications to Serve~~
~~Henry D. G. Wallace~~ ~~Director since: 2003~~ ~~Age — 64~~		~~December 2001: Former Group Vice President and Chief Financial Officer, Ford Motor Company (automotive industry).~~ ~~Chair of our Audit Committee~~ and member of our Investment Committee. Currently a director of Hayes-Lemmerz International Inc. (steel and aluminum wheels) since 2003; Ambac Financial Group, Inc. (financial guarantee insurance holding company) since 2004; and Lear Corporation (automotive components) since 2005, serving as presiding director since 2009 and Chairman of the Audit Committee since 2007. ~~We believe that~~ Mr. Wallace’s experience in various senior leadership positions, including as Chief Financial Officer of ~~several major divisions~~Ford Motor Company and President and Chief Executive Officer of ~~a $100+ billion global manufacturing company,~~Mazda Motor Corporation, bring a broad understanding of ~~our~~managing a global ~~manufacturing operations.~~business. Further, Mr. Wallace’s financial expertise, extensive experience in Europe, Latin America and Asia, and his demonstrated leadership on the boards of several ~~other publicly-traded~~publicly traded companies, ~~has been and will continue to b e~~is a tremendous asset to our Board. As a result of Mr. Wallace’s background as a Chief Financial Officer, ~~and his service on the board of a publicly-traded financial services company,~~ he is exceptionally qualified to serve as our current Executive Chairman of the Board and on ~~both~~our Investment Committee, as well as serving as Chair of our Audit Committee ~~and our Investment Committee.~~in 2012.

Alan J. Weber Director ~~since:~~since 2005 Age — 61 64		2007 – Present: Chief Executive Officer, Weber Group LLC, Greenwich, Connecticut (investment ~~consulting)~~advisory);~~May 2005~~2009 – Present: ~~Retired Chairman and Chief Executive Officer, U.S. Trust Corporation,~~Operating Partner, Arsenal Capital Partners, LLC, New York, New York ~~(financial services)~~(private equity). Currently a director of Broadridge Financial Solutions, Inc., Lake Success, New York (securities processing, clearing and outsourcing) since 2007, where he serves as a member of the Audit Committee, and as Chairman of the Compensation Committee. Chair of our Investment Committee and member of our Audit Committee. ~~Currently a director of Broadridge Financial Solutions, Inc. (securities processing, clearing and outsourcing) since 2007.~~ ~~We believe~~ Mr. Weber’s experience as a Chief Executive Officer and Chief Financial Officer in the financial industry, as well as ~~his~~ 27 years of experience at Citibank, including 10 years as an Executive Vice President, ~~have provided and will continue to provide~~provides a tremendous depth of knowledge of our customers and our industry. ~~We also believe that~~Further, Mr. Weber’s experience as Chief Financial Officer of Aetna, Inc., an insurance services company, brings extensive financial expertise to both our Audit Committee and our Investment Committee.

Table of Contents

BENEFICIAL OWNERSHIP OF SHARES

To ~~the~~our knowledge, ~~of the Company,~~ no person beneficially owned more than five percent of ~~the~~our outstanding ~~Common Shares~~common shares as of December 31, ~~2009,~~2012, except for the shareholders listed below. The information provided below iswas derived from ~~Schedules 13D or 13G~~reports filed with the ~~SEC.~~SEC by the beneficial owners on the dates indicated in the footnotes below.

Amount and Nature of
Percent of
Title of Class Name of Beneficial Owner Beneficial Ownership Class

Common Shares GGCP, Inc. et al.
One Corporate Center
Rye, New York 10580 5,621,965 ¹ 8.49
Common Shares Janus Capital Management LLC
151 Detroit Street
Denver, Colorado 80206 4,799,120 ² 7.20
Common Shares BlackRock, Inc.
40 East 52^nd Street
New York, New York 10022 3,471,353 5.24



Title of Class	Name of Beneficial Owner	Amount and Nature of Beneficial Ownership	Percent of Class
Common Shares	State Street Corporation One Lincoln Street Boston, Massachusetts 02111	4,966,809 ¹	7.90
Common Shares	GGCP, Inc. et al. One Corporate Center Rye, New York 10580	4,753,358 ²	7.51
Common Shares	Janus Capital Management, LLC 151 Detroit Street Denver, Colorado 80206	4,459,310 ³	7.00
Common Shares	BlackRock, Inc. 40 East 52nd Street New York, New York 10022	3,903,179 ⁴	6.17
Common Shares	The Vanguard Group 100 Vanguard Blvd. Malvern, Pennsylvania 19355	3,409,341 ⁵	5.39


¹	The Schedule 13G filed with the SEC on February 11, 2013 indicates that, as of December 31, 2012, State Street Corporation, a holding company, had shared voting and dispositive power with respect to 4,966,809 shares through its direct or indirect subsidiaries.

The Schedule 13D/A filed with the SEC on ~~November 4, 2009~~January 10, 2013 indicates that, as of ~~November 3, 2009:~~January 10, 2013: (A) Gabelli Funds, LLC had sole voting and dispositive power with respect to ~~1,291,000 Common Shares;~~1,140,000 common shares; (B) GAMCO Asset Management Inc. had sole voting power with respect to ~~3,940,265 Common Shares~~3,333,358 common shares and sole dispositive power with respect to ~~4,200,065 Common Shares;~~3,536,358 common shares; (C) MJG Associates, Inc. had sole voting and dispositive power with respect to ~~15,000 Common Shares;~~4,000 common shares; (D) ~~Gabelli Securities, Inc.~~MGJ - IV Limited Partnership had sole voting and dispositive power with respect to ~~17,900 Common Shares;~~5,000 common shares; (E) Gabelli Foundation, Inc. had sole voting and dispositive power with respect to ~~22,000 Common Shares;~~8,000 common shares; (F) GGCP, Inc. had sole voting and dispositive power with respect to ~~10,000 Common Shares;~~4,000 common shares; and (G) Mario J. Gabelli had sole voting and dispositive power with respect to ~~66,000 Common Shares.~~56,000 common shares. Mario Gabelli is deemed to have beneficial ownership of the securities owned beneficially by each of the foregoing persons. ~~Gabelli Securities, Inc. is deemed to have beneficial ownership of the securities owned beneficially by Gabelli & Company, Inc.~~ GAMCO Investors, Inc., and GGCP, Inc. are deemed to have beneficial ownership of the securities owned beneficially by each of the foregoing persons other than Mario Gabelli and the Gabelli Foundation, Inc.


²³		The Schedule 13G filed with the SEC on February ~~16, 2010,~~14, 2013 indicates that, as of December 31, ~~2009,~~2012, Janus Capital Management LLC ~~an investment adviser,~~ had sole voting and dispositive power ~~with respect to 13~~over 4,403,310 common shares and shared voting and dispositive power over 56,000 common shares.


⁴	The Schedule 13G filed with the SEC on January 30, 2013 indicates that, as of December 31, 2012, BlackRock, Inc. had sole voting and dispositive power with respect to ~~4,799,107~~3,903,179 common shares.


⁵	The Schedule 13G filed with the SEC on February 12, 2013 indicates that, as of December 31, 2012, The Vanguard Group had sole voting power over 44,967 common shares, ~~through its ownership stake in INTECH Investment Management~~sole dispositive power over 3,367,174 common shares, and ~~Perkins Investment Management LLC.~~shared dispositive power over 42,167 common shares.

SECURITY OWNERSHIP OF DIRECTORS AND MANAGEMENT

The following table shows the beneficial ownership of ~~Common Shares of the Company,~~Diebold’s common shares, including those shares which individuals have a right to acquire (for example, through exercise of options under the 1991 Plan) within the meaning ofRule 13d-3(d)(1) under the ~~Securities~~ Exchange Act, ~~of 1934,~~ by ~~(a)~~(1) each director-nominee, ~~(b)~~(2) the ~~Chief Executive Officer, each individual who served as Chief Financial Officer during 2009, and~~former CEO, (3) the CFO, our three other most highly compensated executive officers serving as of ~~the Company,~~December 31, 2012, and another individual that would have been deemed a Named Executive Officer had she remained in her role as of December 31, 2012, all of whom we refer to collectively as the ~~Named~~“Named Executive Officers,” and ~~(c)~~(4) all director-nominees, Named Executive Officers and other executive officers ~~of the Company~~ as a group as of ~~March 1, 2010.~~February 25, 2013.

Ownership is also reported as of ~~January 30, 2010~~February 25, 2013 for shares in the 401(k) Savings Plan over which the individual has voting power, together with shares held in ~~the~~our Employee Stock Purchase Plan.

Common Shares
Stock Options

Beneficially
Exercisable
Deferred
Percent of

Director-Nominees: Owned Within 60 Days Shares¹ Class
Bruce L. Byrnes — — — —
Mei-Wei Cheng — — 3,500 *
Phillip R. Cox — 9,000 7,200 *
Richard L. Crandall 9,089 21,500 7,200 0.05
Gale S. Fitzgerald 6,089 21,500 7,200 0.04
Phillip B. Lassiter 8,771 21,500 7,200 0.05
John N. Lauer 19,721 18,500 10,577 0.06
Thomas W. Swidarski 102,767 ^2,3 263,400 — 0.55
Henry D. G. Wallace 1,000 17,500 9,300 0.03
Alan J. Weber 1,500 9,000 7,200 0.02

Table of Contents

Common Shares
Stock Options

Beneficially
Exercisable
Deferred
Percent of
Owned Within 60 Days Shares¹ Class

Other Named Executive Officers:

Bradley C. Richardson⁴

Executive Vice President and Chief Financial Officer 31,850 — — 0.05
James L.M. Chen
Executive Vice President, International Operations 58,263 52,375 — 0.17
George S. Mayes Jr.
Executive Vice President, Global Operations 26,406² 26,875 — 0.08
Charles E. Ducey Jr.
Executive Vice President, North America Operations 24,354² 54,875 1,180 0.12
Leslie A. Pierce⁵

Former Interim Chief Financial Officer 4,267² 6,987 — 0.02
Kevin J. Krakora⁶

Former Chief Financial Officer 34,828² 98,500 — 0.20
All Current Director-Nominees and Executive Officers as a Group (25)
549,887^{2, 3} 1,059,636 75,887 2.43



Director-Nominees:	Common Shares Beneficially Owned	Stock Options Exercisable Within 60 Days	Deferred Shares¹	Percent of Class
Patrick W. Allender	—	—	5,950	*
Roberto Artavia	—	—	—	*
Bruce L. Byrnes	—	—	8,750	*
Phillip R. Cox	—	9,000	15,950	*
Richard L. Crandall	6,089	17,500	15,950	*
Gale S. Fitzgerald	6,089 ⁴	17,500	15,950	*
Robert S. Prather, Jr.	—	—	—	*
Rajesh K. Soin	—	—	2,850	*
Henry D. G. Wallace	1,000	17,500	18,050	*
Alan J. Weber	1,500	9,000	15,950	*
Other Named Executive Officers:
Thomas W. Swidarski ² Former President, CEO and Director	226,035 ³	424,282	—	1.02%
Bradley C. Richardson Executive Vice President and Chief Financial Officer	32,741	66,250	—	*
Charles E. Ducey, Jr. ⁵ Former Executive Vice President, North America Operations	45,991³	66,600	1,180	*
George S. Mayes, Jr. ⁶ Executive Vice President and Chief Operating Officer (Former Executive Vice President, Global Operations)	53,462³	44,250	—	*
Frank A. Natoli, Jr. Executive Vice President, Chief Innovation Officer	22,640³	8,950	—	*
Leslie A. Pierce ⁷ Former Vice President and Corporate Controller	8,632³	—	—	*
All Current Directors, Director-Nominees, Named Executive Officers and Current Executive Officers as a Group (25)	554,237 ^3,4	865,931	132,157	2.25%


*	Less than 1%.


¹		The deferred shares awarded to the director-nominees, as discussed above under “~~2009~~ Compensation of ~~Non-Employee~~ Directors,” and shares deferred by Mr. ~~Lauer~~Ducey pursuant to our deferred incentive compensation plans, are not included in the shares reported in the “Common Shares Beneficially Owned” column, nor are they included in the “Percent of Class” column.


²	Mr. Swidarski stepped down as our President and Chief Executive Officer effective as of January 19, 2013.


²³		Includes shares held in his or her name under the 401(k) Savings Plan over which he or she has voting power, and/or shares held in the Employee Stock Purchase Plan.


³⁴		Includes shares held in the name of the spouse of the director-nominee, Named Executive ~~Officer.~~Officer or other corporate officer.


⁵	Mr. Ducey stepped down as our Executive Vice President, North America Operations effective as of January 23, 2013.


⁴⁶		Mr. ~~Richardson~~Mayes was ~~appointed~~our Executive Vice President, Global Operations during 2012. Effective as of January 19, 2013, he became our Executive Vice President and Chief ~~Financial Officer effective as of November 23, 2009.~~Operating Officer.



⁵⁷		Ms. Pierce ~~served as interim Chief Financial Officer from March 25, 2009 through November 22, 2009, and she currently serves~~stepped down as Vice President and Corporate ~~Controller.~~

⁶		~~Mr. Krakora served as Executive Vice President and Chief Financial Officer until stepping down~~Controller effective as of ~~March 25, 2009,~~April 18, 2012. For further explanation and ~~he currently serves as Executive Vice President, Corporate Development.~~discussion, see “Separation Agreements” under “Compensation Discussion and Analysis” below.


*		~~Less than 0.01%.~~

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the ~~Securities~~ Exchange Act ~~of 1934~~ requires our directors and executive officers, and persons who own more than 10% of our ~~Common Shares,~~common shares, to file with the SEC reports of ownership of our securities on Form 3 and changes in reported ownership on Form 4 or Form 5. Such directors, executive officers and 10% shareholders are also required by SEC rules to furnish us with copies of all Section 16(a) forms they file.

In 2012, due to administrative oversight, one grant of restricted stock units (RSUs) to Frank A. Natoli, Jr. was not timely reported on Form 4. A Form 5 was timely filed reflecting Mr. Natoli’s annual statement of changes in beneficial ownership. Based solely upon a review of the reports furnished to us, or written representations from reporting persons that all other reportable transactions were reported, we believe that during the year ended December 31, ~~2009,~~2012, our directors, executive officers and 10% shareholders timely filed all other reports they were required to file under Section 16(a).

Table of Contents

COMPENSATION COMMITTEE REPORT

The Compensation Committee has reviewed and discussed with management the following “Compensation Discussion and Analysis” section of ~~the Company’s 2010~~this 2013 proxy statement. Based on our review and discussions, we recommend to the Board that the “Compensation Discussion and Analysis” be included in the ~~Company’s~~company’s Annual Report onForm 10-K for the year ended December 31, ~~2009~~2012 and this proxy statement.

The foregoing report was submitted by the Compensation Committee of the Board and shall not be deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A promulgated by the SEC or Section 18 of the ~~Securities~~ Exchange ~~Act of 1934.~~Act.

The Compensation Committee:

~~Phillip B. Lassiter, Chair~~
Phillip R. Cox,
Chair

Richard L. Crandall

Gale S. Fitzgerald

Rajesh K. Soin

John N. Lauer

COMPENSATION DISCUSSION AND ANALYSIS

In this section, we describe the material components of our executive pay program for our Named Executive Officers, whose compensation is set forth in the tables following this discussion in accordance with SEC rules:


▪	Thomas W. Swidarski: Former President and Chief Executive Officer

▪Bradley C. Richardson: Executive Vice President and Chief Financial Officer


▪	Charles E. Ducey, Jr.: Former Executive Vice President, North America Operations


▪	George S. Mayes, Jr.: Executive Vice President and Chief Operating Officer (formerly our Executive Vice President, Global Supply Chain, through January 18, 2013)

▪Frank A. Natoli, Jr.: Executive Vice President, Chief Innovation Officer


▪	Leslie A. Pierce: Former Vice President and Corporate Controller

Compensation information is detailed for Leslie A. Pierce, our former Vice President and Corporate Controller, who stepped down from the company effective as of April 18, 2012. For further explanation and discussion regarding Ms. Pierce, see “Employment and Separation Agreements” below.

The Compensation Committee, or the Committee, has oversight responsibility for the development and administration of Diebold’s executive compensation policies and programs. This “Compensation Discussion and Analysis” explains how and why the Committee arrived at specific compensation policies and decisions for our Named Executive Officers in 2012, as well as compensation decisions for 2013.

Our Business and 2012 Highlights

Diebold is a global leader in providing integrated self-service delivery and security systems and services primarily to the financial, commercial, government, and retail markets in nearly 90 countries worldwide. In 2012, we focused on three pillars to accelerate the company into a world-class, software-led services provider:

A strategy that leverages our leadership in software-led services, attuned with the needs of our core global markets for financial self-service and security solutions.

The financial capacity to implement that strategy and fund the investments necessary to drive growth, while preserving the ability to return value to shareholders in the form of reliable, growing dividends and, as appropriate, share repurchases.

A disciplined risk assessment process, focused on proactively identifying and mitigating potential risks to our continued success.

The Committee designed the 2012 executive pay program for our Named Executive Officers primarily to motivate, incentivize and reward the achievement of financial and performance goals related to these strategies. The Committee

Table of Contents

evaluated factors within the following 3 categories for the 2012 executive pay program, each described in more detail under “2012 Pay Elements” below:
Overall corporate achievement of non-GAAP earnings per share, or EPS (non-GAAP EPS is net income per share, excluding restructuring charges, non-routine income and expenses, and impairment charges);

The Named Executive ~~Pay Program Overview~~Officers’ respective roles in executing our short- and long-term strategic goals; and

The Named Executive Officers’ respective individual performance goals.

Our Compensation Strategy

Our executive pay program is managed by the Compensation Committee, which we refer to in this Compensation Discussion and Analysis as the Committee. The role of the Committee is to oversee our executive pay plans and policies, administer our stock plans and annually review and make recommendations to the Board for all pay decisions relating to our executives, including the Named Executive Officers (the Chief Executive Officer, each individual who served as Chief Financial Officer during 2009, and our three other most highly compensated executive officers).

~~Our executive pay program is~~specifically designed to:


•	~~Provide a total pay opportunity that is commensurate with our performance and competitive with a relevant peer group of companies, as well as other industrial companies similar in revenue size to us.~~

•	Link the financial interests of executives with those of shareholders through short- (annual) and long-term incentive plans that are clearly tied to corporate, business unit and individual performance.

•	~~Provide a balance of both short- and long-term goals.~~

•	~~Emphasize performance-based, variable pay.~~

•	~~Build substantial stock ownership by executives.~~

•	~~Enable us to attract, retain and motivate high quality executives.~~

Focus on performance metrics that drive long-term shareholder value, including total shareholder return, or TSR.

~~Our~~Encourage decision-making in alignment with our business strategies, with goal-setting based on a philosophy of continuous improvement, commitment to becoming a “top tier” performer and supporting our longer-term business strategy.

Reflect industry standards, offer competitive program design and pay opportunities, and balance our need for talent with our need to maintain reasonable compensation costs.

Attract, motivate, and retain executive ~~pay program is consistent with these objectives.~~ talent willing to commit to building long-term shareholder value.

Emphasize a global approach, locally customized to accommodate specific country conditions — ensuring fairness, market competitiveness, and compliance.

The following table summarizes ~~the~~ key elements of our ~~2009~~2012 executive ~~pay~~compensation program:

~~Target Pay Position~~

Element

Primary Purpose

~~Factors Increasing or Decreasing Rewards~~

~~Relative to Peer Group~~

Key Characteristics

Base Salary

~~Reward individuals’ skills, competencies, experience and performance~~To compensate the executive fairly for the responsibility level of the position.

Fixed compensation component; reviewed annually.

~~• Performance against objectives~~

~~• Individual responsibilities and experience level~~

~~• Company financial performance~~Annual Cash Bonus

To motivate, incentivize and reward organizational and individual achievement of annual strategic financial and individual objectives.

~~Historically below median in order to emphasize variable pay components; however, the Committee has begun shifting towards median for all pay elements~~

Variable compensation component; reviewed annually. The primary performance components are:

~~Annual Cash Bonuses~~ • Corporate non-GAAP EPS;

• Key initiatives (e.g., free cash flow, or FCF¹); and

• Individual performance goals.

Long-Term Incentives

To align executives with shareholder interests, and to reinforce and reward long-term shareholder value creation.

Variable compensation component; reviewed and granted annually.

• Performance Shares

~~Motivate~~

• To motivate and reward performance

achievement ~~of annual financial objectives and individual goals~~

~~• Corporate earnings per share, or EPS~~

~~• Achievement of key initiatives or other corporate goals~~

~~• Achievement of individual financial and non-financial goals~~

~~Above median to bring total cash compensation to or around median for target performance~~

~~Long-Term Incentives (LTI)~~over a three-year period.

~~Performance Shares~~

~~Incentivize performance and achievement of strategic goals over a three-year period~~

• ~~Total shareholder return, or~~ TSR relative to peers and S&P 400 Mid-Cap

companies,

~~Total potential value is above median to provide competitive total pay~~ and ~~build equity ownership. Value is typically delivered in the form of:~~stock price growth.

• Stock Options

~~Incentivize increase in shareholder value~~

• To increase shareholder value.

• Stock price growth above the exercise price at

grant.

• RSUs

• ~~Approximately 50% performance shares for target results~~

To increase shareholder value and promote

~~• Approximately 50% options, valued using the Black-Scholes method~~

~~Benefits and Perquisites~~ executive retention.

• Stock price growth.

Health/Welfare Plan and Retirement Benefits

~~Provide for basic life and income security needs, and overall~~

To provide competitive benefits that ~~are competitive with our peers~~promote employee health and productivity and support financial security.

Fixed compensation component.

~~• Years of service~~

~~• Base salary~~Perquisites and Other Benefits

~~Median levels~~

~~Change-in-Control~~ ~~Benefits~~

To provide business-related benefits, where appropriate.

Fixed compensation component.

Change-in-Control Protection

~~Bridge~~

To bridge to future employment if employment is terminated following a change-in-control of the company.

~~• None;~~Fixed compensation component; only paid in the event the executive’s employment is terminated following a change-in-control of the company.

Severance Protection

~~Below median levels~~

The mix of base salary, annual cash bonuses and LTI noted in the above table, which we refer to throughout this Compensation Discussion and Analysis as total pay, generally makes up our executive pay program. In addition to the pay elements noted in the above table, we occasionally award special grants of restricted stock units, or RSUs, in cases of the hiring, promotion and retention of executives. In order to confirm the continued appropriateness of each element of our executive pay program, the Committee annually reviews the pay practices of similarly sized peer companies in related industries.


~~2009-2010 Summary of Executive Compensation Actions/Results~~
*~~2009 Actions/Results~~*			*~~2010 Actions~~*
*~~Base Salary~~*
~~• Due~~To bridge to the economic downturn, the Committee, at management’s recommendation, froze salaries for the majority of our executives, including our Named Executive Officers, for the duration of 2009, with only a few exceptions relating to promotional or equitable increases, as discussed in more detail below under “~~Analysis of 2009~~~~Elements of Executive Pay~~.future employment if employment is terminated other than “for cause.”			• The Committee reinstated merit increases for executives, with annual merit increases for all executives as a whole, excluding promotional or equity increases, generally 3% on average, as discussedFixed compensation component; only paid in ~~more detail below under “~~~~Analysis of 2009 Elements of Executive Pay~~.the event the executive’s employment is terminated other than “for cause.”


¹	FCF is net cash generated from our operating activities and available for execution of our business strategy, excluding capital expenditures.

Table of Contents

2012 Executive Compensation Summary

The Committee approved the following compensation items in 2012, each discussed further in “2012 Pay Elements” below:



Pay Component		Comments
Base Salary		• Mr. Swidarski did not receive an increase in 2012. • Mr. Richardson received a 4.1% increase based on competitive market data for his position. • Mr. Ducey received a 10.5% increase based on competitive market data for his position. • Mr. Mayes received a 2.5% increase based on competitive market data for his position. • Mr. Natoli received a 20% increase due to his promotion to Executive Vice President, Chief Innovation Officer. • Ms. Pierce received a 2.5% increase based on competitive market data for her position.
Annual Cash Bonus
Annual Cash Bonus	~~• In 2009, the Committee modified our Annual Cash Bonus Plan, or Cash Bonus Plan, as discussed in further detail below under “~~~~Analysis of 2009 Elements of Executive Pay~~.”			• ~~For 2010~~Mr. Swidarski did not receive a cash ~~bonuses payable in 2011,~~bonus. • Mr. Richardson did not receive a cash bonus. • Mr. Ducey did not receive a cash bonus. • Mr. Mayes received a $149,093 cash bonus, which was 55% of target. • Mr. Natoli received a $117,283 cash bonus, which was 83% of target. • Ms. Pierce stepped down from the ~~Committee set minimum non-GAAP EPS at $1.05 to fund awards under the Cash Bonus Plan.~~company effective as of April 18, 2012, and was not eligible for a cash bonus.

~~• For 2009, the Committee set minimum~~The company did not meet its non-GAAP EPS ~~at $1.10, or 50% of the target non-GAAP EPS of $2.20. The Committee set threshold and maximum non-GAAP EPS at $1.70 and $2.50, or 70% and 114% of target, respectively.~~			~~• 2010 target non-GAAP EPS was set at $2.00, which approximates the mid-point of our 2010 guidance to investors.~~ ~~• Threshold and maximum non-GAAP EPS levels~~goal for ~~2010 were set at $1.60 and $2.30, or 80% and 115% of target, respectively.~~

~~• Actual payout of~~2012. Therefore, cash bonuses ~~for 2009 was determined~~that were granted were based ~~on the following weighted performance metrics: for Mr. Swidarski, Mr. Chen and Mr. Krakora, 50% on EPS, 30%~~ on key initiatives and ~~20% on~~ individual ~~goals;~~performance goals. In addition, the Committee used its negative discretion to eliminate cash bonuses for Messrs. Swidarski, Richardson and ~~for Mr. Mayes, Mr.~~ Ducey ~~and Ms. Pierce, 60%, 20%, and 20%, respectively.~~due to the company’s 2012 performance.
Long-Term Incentives		• ~~The 2010 cash bonus payout will be determined~~Consistent with prior-year practices, the Committee approved grants based on ~~the following weighted~~a thorough review of competitive market data, individual and Company performance, ~~metrics: for Mr. Swidarski, Mr. Richardson, Ms. Pierce~~ and ~~Mr. Krakora, 60% on EPS, 20% on key initiatives, and 20% on individual goals; for Mr. Ducey, 50%, 30% and 20%, respectively; and for Mr. Chen and Mr. Mayes, 40%, 40% and 20%, respectively.~~
					management's recommendations.
		• ~~In 2009, we achieved a non-GAAP EPS of $1.78, which exceeded the minimum non-GAAP EPS required for funding awards,~~Value mix: 40% stock options, 40% performance shares, and ~~resulted in a weighted EPS payout slightly above threshold.~~			~~• The weighting, EPS, key initiatives and individual goals in 2010 for the Named Executive Officers are discussed in more detail below under “~~~~Analysis of 2009 Elements of Executive Pay~~.”

~~• Achievement of key initiatives and individual goals in 2009 is discussed in more detail below under “~~~~Analysis of 2009 Elements of Executive Pay~~.”
20% RSUs.
*~~Performance Shares Results/Objectives~~*
• Our TSR for the 2007 to 2009 performance period was 24th out of an original peer group (discussed below) comprised of 31 companies, and 241st in the S&P Mid-Cap 400 Index, producing an award equal to 55% of the target award.			• The ~~performance criteria for the~~ 2010 to 2012 performance ~~period are identical to that~~share grant payout was 30% of target, based on the performance/payout scale approved by the Committee at the start of the performance period. Our total TSR for the ~~2007~~three-year period 2010 to ~~2009 performance period: our relative TSR~~2012 was 20.4%, which ranked us at the 23rd percentile against our ~~current~~custom peer group discussed further in “Peer Companies and Competitive Market Data” below), and at the 27th percentile against the S&P Midcap 400 index.
• To enhance the design of long-term incentives, starting with the 2012 to 2014 performance cycle, performance share payouts are limited to target in periods when TSR is negative, even if the performance/payout scale calculates that a higher payout was earned.

Corporate Governance Standards

We endeavor to maintain good executive compensation governance standards, including the oversight of our executive compensation programs and policies. The following guidelines and policies were in effect during 2012:

▪

Stock ownership guidelines: Five times salary for CEO; three times salary for CEO direct reports; and one and a half times salary for performance share plan participants. In addition, we have retention requirements for pre- and post-guideline attainment (as described below under “Executive Stock Ownership Guidelines”). The Committee annually tracks progress towards achievement of these ownership guidelines.

▪

Clawback policies: In addition to our stand-alone Clawback Policy regarding recovery of excessive performance-based incentive compensation in certain circumstances (as described below under “Other Compensation Policies”), our equity grants also include general provisions that allow us to cancel or “claw back” incentive compensation pursuant to any shares received pursuant to awards or stock option exercises.


▪	Insider trading policy: The company’s employees, officers and directors are prohibited from trading in Diebold securities, and in derivative securities, when he or she is aware of material, non-public information about the company (as described below under “Other Compensation Policies”).


▪	Blackout periods: In addition to the insider trading policy, executives are prohibited from trading our stock within the period that begins two weeks prior to the end of each quarter through the first business day following our next quarterly earnings release (as described below under “Other Compensation Policies”).


▪	Tally sheets: The Committee annually reviews tally sheets in order to analyze our Named Executive Officers’ total compensation opportunities based on historical grant practices, and to review the potential compensation under various termination scenarios.

▪

Incentive payment thresholds and maximums: As discussed below in “2012 Pay Elements,” both the annual cash bonus plan and the performance share program have threshold performance requirements which must be achieved in order to receive a payment. Maximum payments are capped. Further, performance share plan payments are capped at target in periods of negative TSR, even if an above-target award is earned based on the company’s percentile ranking against the companies in our peer group and the S&P ~~Mid-Cap~~Midcap 400 ~~Index, equally weighted.~~Index.


▪
~~• Performance share awards for 2009 are discussed in more detail below under “~~~~Analysis of 2009 Elements of Executive Pay~~.”			~~• Performance share awards for 2010 are discussed in more detail below under “~~~~Analysis of 2009 Elements of Executive Pay~~.”

*~~RSUs~~*
• Mr. Richardson was the only Named Executive Officer to receive RSUs in 2009 in connection with his recruitment and appointment as Chief Financial Officer. Mr. Richardson’s RSUs are discussed in more detail below under “~~Analysis of 2009 Elements of Executive Pay~~.”			•Change-in-control benefits: As discussed below in ~~more detail below under~~ “~~2010 Grants to Named Executive Officers~~Personal Benefits,” these benefits provide for ~~2010, the Committee changed the LTI pay mix~~management continuity and alignment of executive and shareholder interests in the ~~table above, awarding approximately 20%~~event of ~~total potential LTI value in the form of RSUs.~~

			~~• In addition, the Committee awarded special one-time RSU grants to certain executives, including many~~a change-in-control of the ~~Named Executive Officers.~~

*~~Executive Perks/Miscellaneous~~*company. They are not excessive in that existing coverage for Diebold executives does not provide (a) severance multiples in excess of three times
• Due to the economic downturn, the Committee, at management’s recommendation, reduced or eliminated our 401(k) company match for all associates, including our executives, effective April 1, 2009.			• As a result of cost-cutting actions taken in 2009 and early 2010, and significant free cash flow during 2009, the Committee anticipates reinstating at least some portion of our 401(k) match during 2010.

~~2010 Grants to Named Executive Officers~~Table of Contents

~~Prior to filing this proxy statement for our Annual Meeting, the Committee also approved the following 2010 annual~~salary and target bonus, (b) single trigger cash ~~bonus (at target) and LTI awards to our Named Executive Officers:~~

Target

Payout Under
2010-2012 Performance
2010 Stock
Special One-Time

2010 Annual
Share Awards Option Grants RSUs with

Cash Bonus
Minimum
Target
Maximum
Stock
Exercise
Performance

Grant
Plan
Payout
Payout
Payout
Options
Price
2010 RSUs
Hurdles

Name Date ($) (#) (#) (#) (#) ($/Sh) (#) (#)

Thomas W. Swidarski
2/11/10 800,000 10,625 42,500 85,000 127,500 27.88 20,500 0
Bradley C. Richardson
2/11/10 363,750 1,625 6,500 13,000 25,000 27.88 3,000 5,000
James L.M. Chen
2/11/10 277,007 1,375 5,500 11,000 15,000 27.88 2,500 5,000
George S. Mayes Jr.
2/11/10 257,559 1,375 5,500 11,000 15,000 27.88 2,500 5,000
Charles E. Ducey Jr.
2/11/10 268,132 1,375 5,500 11,000 15,000 27.88 2,500 5,000
Leslie A. Pierce
2/11/10 119,056 687 2,750 5,500 8,000 27.88 1,250 2,000
Kevin J. Krakora
2/11/10 160,000 1,125 4,500 9,000 12,000 27.88 2,000 0

For 2010, the Committee changed its LTI mix to provide for the delivery of total potential value in the form of approximately 40% performance shares (at target results), 40% stock options (valued using the Black-Scholes method), and 20% RSUs. The Committee made this change to (1) better align our LTI pay mix with market practice, and (2) provide an LTI mix with more of a balance between long-term company performance, shareholder alignment and value creation, and executive retention.

The Committee also awarded special one-time RSU grants to certain of the Named Executive Officers in 2010. These RSUs have special vesting requirements in order to emphasize retention and to reward only for sustained long-term results. Unlike most RSU grants, which vest after three years, these one-time RSU awards dopayments, and/or (c) modified single trigger provisions. Future change-in-control provisions will not vest until the seventh anniversary of the grant. However, one-half of the award may vest early if our stock price reaches $45 per share for 20 consecutive trading days, and the other half of the award may vest early if our stock price reaches $55 per share for 20 consecutive trading days.

~~All of these 2010 grants will be discussed in more detail in our 2011 proxy statement.~~

~~2009 Average Pay Mix~~

Based on a payout of annual cash bonuses and performance shares at target (notwithstanding actual cash bonus payout in 2010 and actual performance share payout in 2012), our Named Executive Officers had, on average, the following pay mix in 2009, which supports the Committee’s goals of balancing short- versus long-term goals (salary/bonus versus LTI), emphasizing performance-based (variable) pay, and encouraging share ownership by our executives:

~~CEO:~~

~~Other NEOs:~~

~~As noted below under “~~~~Committee Deliberation and Rationale~~,” the Committee does not have a specific formula for allocating total pay between short- and long-term pay elements or between cash and non-cash pay elements. However, the Committee does vary the mix of these elements based on competitive practices, ensuring the program remains competitive with our peers, and management level to recognize each individual’s operating responsibilities and ability to impact our short- and long-term results.

~~Market Benchmarking of Executive Pay~~

In setting pay for our executives, including the Named Executive Officers, we target total pay at the median of a peer group of companies, which we refer to throughout this Compensation Discussion and Analysis as the peer group. However, actual pay can vary significantly from~~year-to-year~~ ~~and among individuals within a given year based on corporate and individual performance and experience.~~

The Committee reviews peer group practices annually to determine total pay levels and periodically to identify new pay elements or emerging trends. In addition to peer group data, the Committee also reviews data obtained from nationally recognized compensation surveys for a broad range of companies of comparable size and similar revenue. This additional information helps confirm peer group results and represents the broader market in which we compete for senior executives. In 2009, we developed data from both sources to benchmark all elements of total pay.

~~Peer Group~~

Each year the Committee also reviews the peer group itself, as companies may merge or be acquired, liquidated or otherwise disposed of, or may no longer be deemed to adequately represent our peers in the market. The peer group was expanded from 28 companies in 2008 to 44 companies in 2009, because the Committee determined that, as a result of attrition over time, the peer group no longer represented an appropriately sized sampling of peer companies.

~~Several factors are used to select peer group companies:~~

include excise tax gross-ups.


• ▪	~~Company size: revenue, number of employees~~ Executive perquisites and ~~market capitalization.~~other benefits: As discussed below in “Personal Benefits,” these perquisites and other benefits are limited and do not include income tax gross-ups. In addition, the company is eliminating the company car program for executives effective March 2013.


▪	Independent compensation consultant: Aon Hewitt is retained directly by the Committee as its independent compensation consultant, and provides advice on all executive officer pay decisions, and keeps the Committee apprised of compensation best practices.


• ▪	~~Products: capital equipment, technologically advanced systems~~ Compensation risk assessment: As discussed above in “Compensation Committee Risk Oversight,” the Committee conducts an annual risk assessment of the company’s compensation policies and ~~repair or maintenance services~~practices to ~~such equipment or systems.~~

•	~~Markets: banking, financial services, health care, education, government, utilities and retail.~~

•	~~Percent of revenue from global operations.~~ensure that our programs are not reasonably likely to have a material adverse effect on the company.

Consideration of 2012 Say-on-Pay Vote

At the 2012 Annual Meeting of Shareholders, the advisory vote to approve the executive compensation program for our Named Executive Officers received strong support (94% of votes on that issue). Management and the Committee considered this strong support of the current pay structure by our shareholders in their compensation program discussions throughout 2012. Based on these results, the Committee will continue to apply the same principles in determining future executive compensation policies and programs. The Committee is dedicated to continuous improvement to the executive pay program, consistent with its overall compensation strategy, and will continue to review and evaluate market trends and best practices in designing and implementing elements to our compensation program.

2012 Total Compensation Mix

In support of our pay-for-performance objective, the Committee believes targeted total compensation should be more heavily weighted by variable compensation (short- and long-term incentives) than fixed compensation (base salary), and that long-term incentives should be more heavily weighted than short-term incentives, consistent with competitive market practice and each executive’s roles and responsibilities. The following charts summarize our total compensation mix and our short- versus long-term incentives orientation:



Named Executive Officer	Fixed Compensation (Salary)	Variable Compensation (“At Risk” Incentives)
Thomas W. Swidarski	16%	84%
Other Named Executive Officers (average)	32%	68%



Named Executive Officer	Annual Cash Bonus	Long-Term Incentives
Thomas W. Swidarski	19%	81%
Other Named Executive Officers (average)	31%	69%

Long-Term Incentive Valuations

The Committee used the compensation consultant’s long-term incentive valuation methodology to calculate an economic value for stock options, performance shares, and RSUs. The total compensation opportunity to each Named Executive Officer includes long-term incentive value, salary and target bonus. This long-term incentive methodology is different than the FASB ASC Topic 718 valuation used for the “Summary Compensation Table” and “Grants of Plan-Based Awards” table because this methodology measures opportunity to the executive, rather than the anticipated cost to the company.

Regarding these long-term incentives, ASC Topic 718 generates a value higher than the target value on grant date. The Committee believes that long-term incentive awards should not be valued higher than the ~~new~~target value on the grant date because there is a probability of forfeiture if performance criteria are not achieved. In addition, the Committee believes measuring TSR against the companies in our peer group creates a strong performance measurement system by focusing on value creation to our shareholders.

Table of ~~44 companies, which includes 27~~Contents

Compensation Decision Process

Role of the ~~28 companies~~Compensation Committee

The Committee is responsible to our Board for oversight of our executive compensation programs. The Committee consists of independent directors and is responsible for the review and approval of all aspects of our program. Among its duties, the Committee is responsible for:

Reviewing and assessing competitive market data from the ~~prior group, fairly represents~~independent compensation consultant, discussed below.

Reviewing and approving incentive goals, objectives and compensation recommendations for the ~~companies with which we compete~~Named Executive Officers.

Evaluating the competitiveness of each executive’s total compensation package.

Approving any changes to the total compensation package for ~~executive talent.~~

~~These companies range from approximately~~1/2 ~~to 2 times our annual revenue. The peer group also serves as one of~~ the indexes used to assess our TSR as part of our performance share plan. Thermo Fisher Scientific Inc. was the only company removed from the prior peer group, as the Committee determined that it was too large and no longer represented a comparable sized company from the standpoint of revenue, number of employees and market capitalization.

During 2009, the following companies made up the peer group and, as such, served as the primary basis for benchmarking our pay levels and practices for both our directors and our executives, including our Named Executive Officers ~~(companies~~including, but not limited to, salary, annual incentives, long-term incentive award opportunities and payouts, and retention programs.

Following review and discussion, the Committee submits recommendations to the Board for approval. The Committee is supported in ~~bold were added~~its work by the Chief Human Resources Officer and staff, and an independent compensation consultant, discussed in ~~2009):~~“Role of the Independent Compensation Consultant” below. For additional information regarding the Committee’s duties and responsibilities, see “Compensation Committee Risk Oversight” and “Compensation Committee” above.

12/31/08 Market

2008 Revenue
Capitalization
No. of Employees

2009 Peer Group:

Products/Markets:
($ in Millions): ($ in Millions): (2008):

Actuant Corp.
Global manufacturing/sales (industrial products) 1,664 1,072 7,500

Affiliated Computer Services, Inc. Business process outsourcing and information technology 6,160 4,476 65,000

Agilent Technologies Inc.
Bio-analytical and electronic measurement solutions provider 5,774 5,471 19,600

Ametek, Inc. Global manufacturing/sales (electromechanical devices) 2,531 3,224 11,700

Benchmark Electronics, Inc. Global electronics manufacturing services 2,590 839 10,522

Brady Corp.
Manufacturing/sales (identification solutions) 1,523 1,262 7,800

Cooper Industries plc Global manufacturing/sales (electrical products and tools) 6,521 5,066 31,202

Corning Inc. Global manufacturing/sales (specialty glass and ceramics) 5,948 14,743 27,000

Crane Co. Global manufacturing/sales (engineered industrial products) 2,604 1,031 12,000

Curtiss-Wright Corp.
Global manufacturing/sales (precision components and systems) 1,830 1,502 8,000

Deluxe Corp. Provider of personalized printed products to financial institutions 1,469 765 7,172

Donaldson Company, Inc. Global manufacturing/sales (filtration systems) 2,240 2,592 12,700

Dover Corp. Global manufacturing/sales (industrial products and components) 7,569 6,122 32,300

Fiserv, Inc. Information management and electronic commerce systems/services 4,739 5,870 20,000

Flowserve Corp.
Global manufacturing/sales (precision-engineered flow control equip) 4,473 2,874 15,000

FMC Technologies, Inc. Global technology solutions provider to industrial markets 4,551 2,979 9,800

Goodrich Corp.
Global supplier (aerospace components, systems and services) 7,062 4,557 25,000

Harman International Industries Inc.
Global manufacturing/sales (audio products and electronic systems) 4,113 979 11,694

Harris Corp. Global communications and information technology provider 5,311 5,039 16,500

Hubbell Inc. Global manufacturing/sales (electrical and electronic products) 2,704 1,837 13,000

International Game Technology Global manufacturing/sales (computerized gaming equipment) 2,529 3,504 5,800

Itron, Inc.
Global energy and water products and service provider 1,910 2,197 8,700

Lennox International Inc. Global manufacturing/sales (HVAC and refrigeration) 3,481 1,788 13,500

ManTech International Corp.
Global technologies/solutions provider for national security programs 1,871 1,918 7,900

Mettler-Toledo International Inc. Global manufacturing/sales (precision weighing instruments) 1,973 2,259 10,000

Moog Inc.
Global manufacturing/sales (precision motion/fluid controls/systems) 1,903 1,561 8,844

NCR Corp. Global manufacturing/sales (financial technologies/services) 5,315 2,282 22,400

Pall Corp. Global manufacturing/sales (filtration/purification products and systems) 2,572 3,356 10,600

Pentair, Inc.
Global diversified industrial manufacturing/sales 3,352 2,335 14,700

PerkinElmer, Inc. Global health and safety technology solutions provider 1,937 1,643 7,900

Pitney Bowes Inc. Global mail processing and integrated mail solutions provider 6,262 5,252 35,140

Rockwell Automation Global industrial automation power, control and information solutions 5,698 4,617 21,000

Rockwell Collins, Inc. Global design and production of communications and aviation electronics 4,780 6,200 20,300

Roper Industries, Inc.
Global manufacturing/sales (energy systems/industrial imaging products) 2,306 3,894 7,900

Sauer-Danfoss Inc. Global manufacturing/sales (engineered hydraulic and electronic systems) 2,091 422 9,600

SPX Corp.
Global flow technology products and industrial services provider 5,856 2,206 17,800

Teledyne Technologies Inc.
Global electronic components and communications products provider 1,893 1,598 8,800

Teleflex Inc. Global manufacturing/sales (single-use medical devices) 2,421 1,990 14,200

The Brink’s Company
Global security and cash management services 3,164 1,231 56,900

The Timken Company
Global manufacturing/sales (engineered steel products) 5,664 1,895 25,662

Thomas & Betts Corp. Manufacturing/sales (electrical components for industrial construction) 2,474 1,335 10,000

Unisys Corp. Global design and management of information technology systems 5,233 308 29,000

Varian Medical Systems, Inc. Global manufacturing/sales (cancer therapy systems and x-ray products) 2,070 4,401 4,900

Waters Corp.
Global manufacturing/sales (analytical instruments) 1,575 3,602 5,033
Removed from peer group in 2009:

Thermo Fisher Scientific Inc. Global analytical and laboratory products and systems provider 10,498 23,145 34,500

~~Pay Setting Process~~Timing

Pay recommendations for our executives, including the Named Executive Officers, are typically made by the Committee at its first scheduled meeting of the ~~Committee’s first meeting each~~ year, ~~which is~~ normally held in February. This meeting is normally held around the same time we report our fourth quarter and year-end financial results for the preceding fiscal year and provide our financial guidance for the upcoming year. This meeting is also typically more than two months before we report our first quarter earnings.

Decisions with respect to prior year performance, performance for other relevant periods and any resulting award payouts, as well as equity awards, base salary increases and target performance levels for the current year and beyond, are also made at this meeting.

With respect to the CEO’s pay, the Committee reviews and evaluates the CEO’s performance in executive session, without management or the CEO. The Committee’s final pay recommendations for the CEO are then presented to the independent members of the Board. During an executive session of the Board, the Board conducts its own review and evaluation of the CEO’s performance and after considering all input ultimately approves pay actions for the CEO that it deems appropriate.

In evaluating our total pay program for our executives, conducting benchmarking, assessing our results, designing appropriate plans and recommending other potential actions, the Committee from time to time uses the services of an independent compensation consultant in accordance with the Committee’s charter. In 2009, the Committee again directly engaged the services of Towers Perrin, a global professional services consulting firm, in this capacity. The Committee engaged Towers Perrin due to its knowledge and understanding of our business, our industry, our pay philosophies and our historical pay practices as a result of its many years of providing consulting services to the Committee, and not as the result of any recommendations made by management.

~~Role of Compensation Consultant; Independence~~

Towers Perrin is engaged by, and serves at the will of, the Committee and reports directly to its Chair. Towers Perrin does not provide any consulting services directly to us or management, unless directed to do so by the Committee or to support the Committee’s administration of our executive pay program. However, from time to time, Towers Perrin is also engaged by the Board Governance Committee to review and provide recommendations on our pay program for non-employee directors.

Towers Perrin is generally engaged by the Committee to develop external pay data primarily consisting of comparative analyses of our peer group and companies of comparable size that are outside of our peer group, as well as Fortune 500 companies. Towers Perrin also provides advice on current compensation trends such as long-term incentives, executive retirement,~~change-in-control~~ ~~severance benefits, deferred compensation programs and governance practices in connection with executive pay.~~

~~At the direction of the Committee, Towers Perrin also provides this external pay data to our Chief Human Resources Officer for use in preparing pay recommendations for our executives.~~

At the Committee’s discretion, Towers Perrin may also be asked to attend Committee meetings dealing with executive pay matters. On such occasions, Towers Perrin generally participates in the Committee’s deliberations on executive pay decisions, answers questions regarding compensation trends or the market data it developed, and may provide additional advice or input as requested by the Committee.

During 2009, Towers Perrin provided no additional services to us or management. Any such additional services were generally provided by Watson Wyatt. On December 31, 2009, however, Towers Perrin and Watson Wyatt merged to form Towers Watson. Accordingly, the Committee is reviewing the impact of the merger to determine what actions, if any, should be taken to ensure the independence of its compensation consultant.

~~Role of Management~~

As our primary contact with the Committee, the Chief Human Resources Officer attends and actively participates in all Committee meetings. With respect to executive pay, the Chief Human Resources Officer typically meets independently with Towers Perrin in preparation for upcoming Committee meetings to review the data prepared by Towers Perrin that will be presented at the meeting. The Chief Human Resources Officer will then make pay recommendations to the CEO based upon market pay comparisons and an analysis of our executives’ individual performance goals, as well as other internal factors (such as expanded job responsibilities during the year or extraordinary performance during the year that is not tied to any of the executive’s stated goals). The CEO then reviews these recommendations and, along with the Chief Human Resources Officer, makes final pay recommendations to the Committee. The

~~Committee ultimately approves the executive pay actions it deems appropriate after considering all input.~~

~~Role of the CEO~~

At the Committee’s request, the CEO periodically attends Committee meetings and provides input on pay decisions affecting his management team. As discussed above, the CEO makes recommendations to the Committee with respect to the pay actions and target incentive levels for his management team.

The CEO may also meet with Towers Perrin, along with the Chief Human Resources Officer, to review data that will be presented at a Committee meeting. However, the only input the CEO and Chief Human Resources Officer have with respect to Towers Perrin’s data is to correct factual information about the Company or management.

While the CEO does not make specific recommendations to the Committee with respect to his own pay, the CEO does provide a self-evaluation to the Committee that includes his achievement against the prior year’s goals established by the Committee and his proposed goals for the coming year, which goals are based on the annual strategic, operational and financial plans for the Company that are approved by the full Board prior to any CEO pay discussions.

~~Committee Deliberation and Rationale~~

~~There are many factors that the Committee evaluates in determining increases or decreases in each pay element and in total pay for each executive, including the Named Executive Officers, including:~~


•	~~Promotions/changes in the executive’s responsibilities;~~

•	~~Division or business unit performance;~~

•	~~Individual performance;~~

•	~~Company performance as measured by EPS, Free Cash Flow, TSR and stock price appreciation;~~

•	~~Peer group and other comparable company practices; and~~

•	~~Broader market developments or trends.~~

~~Some of these factors are discussed in more detail below in connection with the analysis of individual pay elements.~~

The amount of total pay achieved or potentially achievable from prior awards does not directly impact annual pay decisions or future pay opportunities. Moreover, the Committee does not have a specific formula for allocating total pay between short- and long-term pay elements or between cash and non-cash pay elements. However, the Committee does vary the mix of these elements based on competitive practices and management level, to recognize each individual’s operating responsibilities and ability to impact our short- and long-term results. The mix of these elements is reviewed by the Committee at least annually.

As part of its deliberation process, the Committee annually reviews a “snapshot” of total direct pay for each executive for purposes of general benchmarking and comparative analysis with our peer group. In this way, the Committee can validate target pay positions with respect to direct pay elements relative to our peer group.

The Committee analyzes data from our peer group, as well as data for executives in similar positions at companies of comparable size that are outside of the peer group, to determine pay positions for each element of compensation. The summary table above under “~~Executive Pay Program Overview~~~~” contains disclosure on how individual pay elements are targeted against the peer group under the column “Target Pay Position Relative to Peer Group.”~~

For example, historically, the Committee targeted base salaries below median levels to ensure that a significant percentage of total pay is contingent on short- and long-term achievement of performance goals and shareholder value creation. Annual cash bonuses were targeted slightly above median levels to produce total cash pay at target results that approximate the median of the peer group. The total value of long-term incentives was targeted above median levels in order to provide competitive total pay at target, as well as to build stock ownership, enhance ties to shareholder returns and emphasize variable over fixed pay.

~~For 2009, consistent with its pay philosophy, the Committee approved pay elements for our executives at target that were at, on average, the following percentages relative to our peer group:~~


•	~~Base salary: 94% of peer group median;~~

•	~~Base salary plus bonus: 100% of peer group median; and~~

•	~~Total pay: 102% of peer group median.~~

However, as discussed above, the Committee has begun shifting all elements of pay toward median levels of our peer group at target results, in order to provide more of a focus on executive retention and more balance across all pay elements. The Committee now believes that in keeping salaries below median of

our peer group, if we fail to consistently achieve target results for the other, variable pay elements, then total pay would consistently be below that of our peer group, which could create retention issues. Given the economic uncertainty beginning in 2008, it has become much more difficult to set appropriate target levels for payout under our variable pay plans. As such, the Committee believes that it is more appropriate to continue shifting our pay elements towards median levels over time, instead of all at once.

~~Internal Equity~~

We provide similar pay ranges for positions with similar characteristics and scope of responsibility, including Named Executive Officer positions. Any differences in compensation among the Named Executive Officers are based on each individual’s experience, operating responsibilities, ability to impact short- and long-term results, demonstrated performance and future potential, as determined by the Committee. Further, in order to attract and retain quality executive officers, the Committee believes it is necessary and proper to provide total pay for each executive position that is commensurate with market practice (determined specifically by reference to the practices of our peer group).

The Committee makes no other distinctions in its pay policies and decisions as among the Named Executive Officers or among the Named Executive Officers and any other executive officer, and such pay policies and decisions are applied consistently among our executives.

~~Timing of Pay Decisions and Equity Awards~~

As previously indicated, pay recommendations for our executives, including the Named Executive Officers, are typically made by the Committee at its first scheduled meeting of the year. This is usually five to 15 days after we report our fourth quarter and year-end financial results for the preceding fiscal year and provide our financial guidance for the upcoming year. It is also more than two months before we report our first quarter earnings.

Generally, any increases in base salary approved at this meeting are made effective retroactively to the beginning of the current year. Further, any equity awards ~~approved~~recommended by the Committee at this meeting are ~~approved~~then reviewed by the Board and, if approved, are dated as of the date of the Board meeting held the following day. As such, the Committee does not time the grants of options or any other equity incentives to the release of material non-public information.

The exceptions to this timing are awards to executives who are promoted or hired from outside the company during the year. These executives may receive salary increases or equity awards effective or dated, as applicable, as of the date of their promotion or hire.

~~Analysis~~Determination of ~~2009 Elements of Executive~~CEO Pay

At the February Committee meeting, in executive session without management present, the Committee reviews and evaluates CEO performance, and determines achievement, for the prior fiscal year. The Committee also reviews competitive market data, as well as corporate financial and individual performance metrics. The Committee then presents, to the independent members of the Board, pay recommendations for the CEO, which include recommendations on salary, incentive payments for the previous year, and equity grants for the current year. During an executive session of the Board, the Board then conducts its own review and evaluation of the CEO’s performance taking into consideration the recommendations of the Committee.

Role of the Independent Compensation Consultant

The Committee retains an independent compensation consultant, Aon Hewitt, in accordance with the Committee’s charter. The consultant reports directly to the Committee. The Committee retains sole authority to hire or terminate Aon Hewitt, approve its compensation, determine the nature and scope of services, and evaluate performance. A representative of Aon Hewitt attends Committee meetings, as requested, and communicates with the Committee Chair between meetings. The Committee makes all final decisions. Other than Aon Hewitt’s roles and services listed below with respect to compensation consulting, it performs no other services for the company.

Aon Hewitt’s specific compensation consultation roles include, but are not limited to, the following:

23

Table of Contents

Advise the Committee on executive compensation trends and regulatory developments.
Provide a total compensation study for executives against the companies in our peer group and recommendations for executive pay.
Provide advice to the Committee on governance best practices, as well as any other areas of concern or risk.
Serve as a resource to the Committee Chair for meeting agendas and supporting materials in advance of each meeting.
Review and comment on proxy disclosure items, including the “Compensation Discussion & Analysis.”
Advise the Committee on management’s pay recommendations.
From time to time, Aon Hewitt is also engaged by the Board Governance Committee to review and provide compensation recommendations for non-employee directors.
The Compensation Committee has considered and assessed all relevant factors, including but not limited to those set forth in Rule 10C-1(b)(4)(i) through (vi) under the Exchange Act, that could give rise to a potential conflict of interest with respect to Aon Hewitt. Based on this review, we are not aware of any conflict of interest that has been raised by the work performed by Aon Hewitt.

Role of Management

Our Chief Human Resources Officer serves as management’s primary contact with the Committee and attends all Committee meetings. For executives other than the CEO position, our CEO and Chief Human Resources Officer make pay recommendations to the Committee based on market pay comparisons and an analysis of each executives’ individual performance. No member of our management team, including the CEO, has a role in making pay recommendations to the Committee for his or her own position.

Peer Companies and Competitive Market Data

Annually, the Committee reviews competitive total compensation market data provided by Aon Hewitt. To assess competitive pay levels, the Committee first annually reviews and approves our peer group composition. The following peer group criteria are considered:
Company size: Approximately 0.5 to 2 times Diebold’s annual revenues, with a focus on market capitalization of 0.2 to 5 times Diebold’s market capitalization, as a secondary reference.
Direct competitors for business and management talent.
Companies covered by the investment analysts that track Diebold.
Companies including Diebold in their compensation peer group.
Global companies that design and manufacture products for their customers, and provide related services.

In December 2011, Aon Hewitt conducted a total compensation study to assist with 2012 compensation decisions. The 25 peer companies approved by the Committee were:
Actuant Corp Fiserv, Inc. NCR Corp.
Benchmark Electronics Inc. Flowserve Corp. Pitney Bowes Inc.
Brady Corp. Global Payments Inc. Rockwell Automation
The Brinks Company Imation Corp. Sensata Technologies
Coinstar Inc. International Game Technology SPX Corp.
Cooper Industries plc¹
Logitech International SA The Timken Company
Dover Corp. Mastercard Inc. Unisys Corp.
Fidelity National Information Services Mettler-Toledo International Inc. The Western Union Company
Woodward Inc.
_____________________________
¹Cooper Industries was acquired by Eaton Corporation in November 2012.

In December 2012, Aon Hewitt conducted a total compensation study to assist with 2013 compensation decisions. The annual revenues for the three largest companies increased beyond the desired revenue range. The Committee approved the replacement of those three companies with three companies meeting the criteria above, as follows:

24

Table of Contents

Removed from the old peer group: Dover Corp., Mastercard Inc., and Rockwell Automation
Added to the new peer group: DST Systems, Harris Corp., and Lexmark International

Aon Hewitt then benchmarks total compensation opportunities for each of our Named Executive Officers using peer company proxy data, as well as published and private compensation survey data. Size-adjusted market values for comparable executive compensation were developed using regression analysis. This statistical technique accounts for revenue size differences within the peer group and develops a market value for comparable executive compensation consistent with our revenue relationship to the peer group companies. The size-adjusted 50th percentile for total compensation is a key reference point for the Committee. On average, our Named Executive Officers’ total compensation opportunities are competitively positioned at the size-adjusted 50th percentile.
2012 Pay Elements

Base Salaries

~~We pay base~~Base salaries are designed to recognize and reward the ~~skills, competencies,~~skill, competency, experience and ~~individual~~ performance an executive brings to his or her position. ~~As a result, changes~~Changes in salary result primarily from ~~changes in~~competitive market data, individual and company performance, internal equity considerations, promotions, and the executive’s ~~responsibilities~~specific responsibilities. The Committee reviews salaries annually.

For 2012, the Committee reviewed competitive market data and ~~an assessment of annual performance.~~

~~At the start of each year, each executive, including~~individual performance assessments for the Named Executive Officers ~~provides personal performance goals that relate tohis/her~~ ~~applicable position, business unit or department. As a result, these personal goals vary for each executive to recognizehis/her~~ ~~responsibilities~~ and ~~areas of influence. Performance against these goals is subjectively assessed annually by~~approved the ~~CEO and the Chief Human Resources Officer, who then make~~following base annual salary ~~recommendations to the Committee. Our full Board assesses the CEO’s performance.~~changes:

~~The Committee relies upon several factors when deciding on increases in salary:~~


•	~~The executive’s performance againsthis/her~~ ~~personal goals, which supports the Committee’s goal of rewarding performance;~~

•	~~Comparisons with base salaries for executives in similar roles in peer group companies, which supports the Committee’s goal of providing competitive pay;~~

•	~~The Committee’s philosophy regarding salaries, which targets salaries below the median of the peer group; and~~

•	~~The Committee’s assessment of our overall performance versus goals and our operating plan and forecasts.~~

~~In assessing the results of an executive’s individual performance, the Committee relies on its judgment and does not rely on a specific formula. This~~

~~evaluation ensures that we have the financial capability to provide the increases and that they are reasonable in light of corporate performance.~~



Named Executive Officer	2011 Salary	2012 Salary	Increase %
Thomas W. Swidarski	$840,000	$840,000	—%
Bradley C. Richardson	$499,500	$520,032	4.1%
Charles E. Ducey, Jr.	$384,322	$424,676	10.5%
George S. Mayes, Jr.	$351,997	$360,797	2.5%
Frank A. Natoli, Jr.	$234,440	$281,328	20%
Leslie A. Pierce	$244,064	$250,166	2.5%

Salary increases ~~may take~~for each of the form of merit, equity or promotional increases. Merit increases are typically annual and are intended to reflect individual experience level and performance from the prior year and year over year, to keep our executives competitive against our peer group, and to provide an adjustment for inflation. Equity increases are provided from time to time in order to account for a shortfall in an executive’s salary against our peer group and provide a one-time adjustment to bring it up to a more competitive pay level. Finally, promotional increases may be given from time to time to compensate for promotions or for a significant increase in an executive’s responsibilities or areas of influence.

In 2009, due to the economic downturn and the significant uncertainty in the financial industry impacting our customers, the Committee, at management’s recommendation, froze salaries for the majority of our executives, including many of our Named Executive Officers, ~~for the duration~~respectively, were based on a review of ~~2009, with only a few exceptions relating to promotional or equitable increases.~~

~~In particular,~~competitive market data and individual performance. Mr. ~~Mayes received a promotional~~Natoli’s increase ~~of 11.5% effective in March 2009 due to~~was based on his promotion ~~in April 2008~~ to Executive Vice President, ~~Global Operations, since~~Chief Innovation Officer, and a thorough review of competitive market data for his ~~responsibilities had been significantly increased and he did not receive an~~new position at the Company. Mr. Ducey’s increase ~~at that time. In addition, Mr. Chen received an equity increase of 7% beginning in July 2009 due to the significant scope of~~was based on competitive market data for his ~~responsibilities (covering all of Europe, the Middle East, Africa and Asia-Pacific) and hisyear-over-year~~ ~~performance. Finally, Ms. Pierce received a one-time salary adjustment for assuming the role of interim CFO for a portion of 2009.~~position.

For 2010 base salaries, the Committee approved modest merit increases because it believed that, as a result of cost-cutting actions taken during 2009 and early 2010 and significant free cash flow during 2009, these merit increases were reasonable in order to remain competitive within our peer group and to continue shifting base salary towards median the of our peer group.

Annual Cash ~~Bonuses~~

Bonus Plan

Our executives, including the Named Executive Officers, ~~also have the ability~~are eligible to earn ~~annual~~ cash ~~bonuses~~awards under our Annual Cash Bonus Plan, ~~that was~~originally approved by shareholders in 2005, and ~~in order to maintain its deductibility~~re-approved at our 2010 Annual Meeting of Shareholders. Payout under the ~~applicable provisions of the Internal Revenue Code, as discussed in more detail below under “~~~~Limitations on Deductibility of Compensation~~~~,” is being proposed for re-approval at our~~ Annual ~~Meeting. Payout under the~~ Cash Bonus Plan depends ~~upon our~~on corporate and individual performance against ~~objective~~pre-determined performance ~~measures established~~objectives approved by the ~~Board~~Committee at the beginning of ~~each~~the fiscal year.

~~Cash bonuses under the plan provide incentives to meet or surpass specific short-term corporate financial goals. As~~Individual target opportunities: Based on a ~~result, the Cash Bonus Plan balances the objectives~~thorough review of ~~our other pay programs, which concentrate on long-term financial results (performance shares)~~competitive market data and stock price growth (performance shares, stock options and RSUs). Finally, annual cash bonuses allow us to maintain relatively low fixed compensation costs and still provide our executives with competitive cash pay, subject to performance.

~~Cash Bonus Opportunity~~. The Committee intends target bonuses to be above median levels relative to the peer group to make up for its below-median salary position and to provide competitive overall cash pay at target results. For 2009, the target bonuses were as follows:


•	~~CEO: 100% of salary;~~

•	~~CFO: 90% of salary for Mr. Krakora, 75% of salary for Mr. Richardson, and 50% of salary for Ms. Pierce;~~

•	~~Other Named Executive Officers: 75% of salary; and~~

•	~~Other executives: 50% to 75% of salary.~~

~~The potential earnout levels~~internal equity, individual Named Executive Officer targets (as a percent of ~~our executives, as a percentage of income,~~base salary) are ~~set~~approved by the Committee ~~so as to provide a reasonable opportunity to achieve total cash pay~~ at ~~target that approximates~~ the ~~median total cash pay~~beginning of ~~our peer group.~~the fiscal year. For 2012, the Committee approved the following targets:

Thomas W. Swidarski: 100% of salary

Bradley C. Richardson: 75% of salary

Charles E. Ducey Jr.: 75% of salary

George S. Mayes, Jr.: 75% of salary

Frank A. Natoli, Jr.: 50% of salary

Leslie A. Pierce: 50% of salary

Actual cash bonuses ~~can~~may range from 0% to 200% of target, depending on ~~our actual performance. In this manner, we can reward our executives with high levels~~performance achievement.

Table of cash bonuses for results that substantially exceed target performance expectations. Conversely, we award relatively low levels of cash bonuses for results that are below target performance expectations, or none at all for results that fail to meet minimally acceptable standards.Contents

Performance ~~Measures~~~~. The Cash Bonus Plan allows~~criteria: For 2012, the Committee ~~to choose levels of, growth in, or~~

~~relative peer company performance in any one or more of~~approved the following categories of performance ~~measures:~~


•	~~EPS;~~

•	~~Return on invested capital;~~

•	~~Return on total capital;~~

•	~~Return on assets;~~

•	~~Return on equity;~~

•	~~TSR;~~

•	~~Net income, revenue, cash flow or operating profit; and/or~~

•	~~Productivity improvement.~~

~~The Committee has historically used~~metrics for the Named Executive Officers: Non-GAAP corporate EPS, key initiatives, and individual performance, each of which are detailed in the following table, along with applicable weighting. We utilize this mix of measurement criteria because non-GAAP corporate EPS as ~~the~~a performance criteria for annual cash ~~bonuses. The Committee believes EPS represents~~bonuses is an important bottom-line financial result that investors use to evaluate the value of our ~~Common Shares. As a result, consistent increases~~common shares. In addition, key initiatives focus on other important financial performance measures critical to the overall success of the company, while individual performance criteria focus on financial and non-financial initiatives specific to each Named Executive Officer’s role in the company.

Non-GAAP EPS ~~over time should lead to improvements in shareholders’ investment. Although~~performance goals and results: The non-GAAP EPS goals and payout opportunities for the non-GAAP EPS portion of the plan approved by the Committee ~~made changes in 2009 to how cash bonuses are paid out, as discussed in more detail below, EPS is still an important component of both the funding of cash bonuses and determining actual payouts.~~for 2012 were:

~~Funding of Cash Bonuses~~. To pay cash bonuses, we fund a bonus pool based on (1) achievement of a minimum EPS and (2) the maximum bonus available to each executive. For 2009, a minimum EPS was set at approximately 50% of our annual EPS guidance to investors, achievement of which funded maximum payouts under the Cash Bonus Plan:



• Threshold	~~Minimum~~à$2.20	40% of target earned
Target	$2.50	100% of target earned
Maximum	$2.80	200% of target earned
Actual	$2.07	No EPS ~~> $1.05~~à ~~Maximum Bonuses Funded~~payout

~~This approach preserves the tax deductibility of all bonuses paid under the Cash Bonus Plan~~When evaluating non-GAAP EPS goals and ~~provides~~results, the Committee ~~the greatest flexibility~~excludes certain restructuring, non-routine income and expense, and impairment items consistent with our guidance to ~~assess~~investors. The company did not achieve 2012 threshold non-GAAP EPS, and ~~reward annual performance.~~

~~Determining Cash Bonuses~~~~. While this minimum EPS is used to fund potential cash~~accordingly, no bonuses ~~the actual payout of cash bonuses is based on achievement of certain weighted corporate goals, key initiatives, and individual goals.~~

~~Weighting~~~~. For 2009, the Committee changed the formula it uses to determine payouts under the Cash Bonus Plan. Historically, payouts under the plan~~ were ~~based entirely on the achievement of EPS targets, with the potential~~earned for the ~~Committee to use negative discretion based on the level~~non-GAAP EPS portion of achievement of individual performance measures. For 2009 cash bonuses, however, the Committee approved the following weighting of performance measures for our executives, including the Named Executive Officers:


•	~~For Mr. Swidarski, Mr. Chen and Mr. Krakora, 50% based on EPS, 30% based on key initiatives, and 20% based on individual goals; and~~

•	~~For Mr. Mayes, Mr. Ducey and Ms. Pierce, 60% based on EPS, 20% based on key initiatives, and 20% based on individual goals.~~

The Committee made this change in order to allow more alignment between cash bonuses and performance of each individual within the division, business unit or functional group on which he or she has the most impact, while still balancing the need for the achievement of acceptable corporate goals.

For 2010, the Committee made the following additional changes to the weighting of performance measures for the Named Executive Officers: for Mr. Swidarski, Mr. Richardson, Ms. Pierce and Mr. Krakora, 60% on EPS, 20% on key initiatives, and 20% on individual goals; for Mr. Ducey, 50%, 30% and 20%, respectively; and for Mr. Chen and Mr. Mayes, 40%, 40% and 20%, respectively.

The Committee made these changes in 2010 for Mr. Swidarski and Mr. Krakora in order to further emphasize consolidated company financial performance and shareholder value creation in the form of EPS, reflective of their focus~~and/or~~ ~~influence on overall corporate results. For Mr. Chen, Mr. Mayes and Mr. Ducey, the changes were made in order to drive key strategicand/or~~ ~~operational results in their specific areas of responsibility, and in turn, contribute to overall corporate results. Mr. Richardson did not join us until November 2009, and so did not participate in~~ the Annual Cash Bonus ~~Plan in 2009. Ms. Pierce’s weighting percentages did not change between 2009 and 2010.~~Plan.

~~Company Goals~~. For 2009, the Committee again selected EPS as the appropriate corporate goal. The EPS level fixed by the Committee for purposes of target payout of cash bonuses is intended to approximately mirror our annual EPS guidance to investors. TheKey initiative performance levels for payout of cash bonuses at threshold and maximum are then generally set as a percentage of the target EPS level. Because the Committee’s pay philosophy has historically been to pay less than median for base salary compared to our peer group, with the difference in median total cash pay to be made up by cash bonus, the threshold for payout was set at a level that was intended to be reasonably capable of achievement. Conversely, the EPS level for

~~maximum payout was set at a level that would require a fairly extraordinary effort to achieve.~~

~~The following levels of EPS were intended to pay out at the following weighted results, with an interpolation of actual results falling in between threshold and maximum:~~



~~• Below Threshold~~	à	~~EPS < $1.70~~	à	~~No weighted EPS payout~~

~~• Threshold~~	à	~~EPS = $1.70~~	à	~~40% of weighted EPS payout~~

~~• Target~~	à	~~EPS = $2.20~~	à	~~100% of weighted EPS payout~~

~~• Maximum~~	à	~~EPS = $2.50~~	à	~~200% of weighted EPS payout~~

Our 2009 EPS target of $2.20 was the mid-range of our 2009 EPS guidance to investors of $2.05 to $2.35, and was set in February 2009, shortly after guidance was provided to the market. Historically, the Committee has set threshold and maximum EPS levels at approximately 80% and 120% of target, respectively, as it considered these percentages to provide for a reasonable range of performance for payout. For 2009, however, given the economic uncertainty, the Committee felt that achievement of EPS results above target would require significantly more effort than in a typical year, and wanted to ensure that cash bonus payouts for 2009 results were properly aligned with the difficulty of achievement. Accordingly, threshold and maximum EPS levels for 2009 were set at 77% and 114% of target, respectively. Our EPS result for 2009 was $1.78, adjusted as discussed below, leading to payout for EPS of 49.6% of target payout for the weighted company goals.

Our 2010 EPS target of $2.00 again approximated the mid-range of our 2010 EPS guidance to investors of $1.90 to $2.15. The 2010 EPS target was set below the 2009 EPS target level due to continued economic uncertainty, particularly in the financial sector, which continues to impact our customers and therefore our EPS outlook. For 2010 the Committee set threshold and maximum EPS levels more in line with historic practices, while still recognizing the continued difficulty of achieving maximum results. Accordingly, the Committee set threshold and maximum EPS for 2010 at 80% and 115% of target, respectively.

~~In establishing these EPS~~ goals and ~~evaluating~~ results the Committee may consider certain non-recurring or extraordinary items to be outside the normal course of business and not reflective of our core performance. Accordingly, the Committee’s determination of EPS results for payout under the Cash Bonus Plan may exclude these items. In addition, in setting EPS targets in 2009, the Committee specifically excluded any revenue from our elections systems and Brazilian lottery businesses, since they are not part of our core businesses and, in any given year, have the potential to impact EPS results (up or down) in a way that does not necessarily reflect core company performance. Further, under the plan, the Committee is authorized to consider negative discretion with respect to bonuses.

~~Key Initiatives~~~~. For 2009, the Committee also approved certain~~: Certain key initiatives for our executives, including the Named Executive Officers, ~~which initiatives were~~are developed and proposed by ~~management.~~management, and approved by the Committee. These key initiatives are intended to drive key strategicand/or operational results in the division, business unit or functional group within which the executive has direct control and ~~influence, and target levels were tied directly to our 2009 financial plan, as well as our guidance to investors.~~influence. Similar to ~~our company~~the Committee’s assessment of non-GAAP EPS goals, the Committee’s assessment of key initiatives ~~may exclude~~generally excludes certain non-recurring or extraordinary items. ~~In addition, for executives~~

As detailed in the table below with ~~multiple~~respect to each Named Executive Officer, respectively, these key initiatives consisted of: revenue growth; FCF; division operating profit, or OP; SmartBusiness 300, or SB300, which is our strategic year-over-year cost reduction initiative to reduce an additional $100 million out of our cost structure; and Next Generation Roadmap, which is our strategic initiative relating to the ~~Committee has no set weighting system~~development of next generation self-service terminals and associated solutions. The Committee’s assessment of 2012 achievement results for each ~~key initiative.~~

~~For 2009, the Committee approved the following key initiatives for our~~ Named Executive ~~Officers (excluding Mr. Richardson):~~


~~Named Executive Officer:~~	~~Key Initiatives:~~	~~Target Levels:~~	~~Achievement:~~
~~Swidarski~~	~~Free cash flow:~~~~Free cash flow is cash generated from our operating activities and available for execution of our business strategy.~~	~~• Threshold = $104 million~~ ~~• Target = $130 million~~ ~~• Maximum = $156 million~~	~~Achieved~~ ~~$207 Million~~ ~~-Maximum-~~
	~~Asia Pacific, or AP, operating profit:~~~~2009 profit earned from our core business activities in AP, excluding interest and taxes.~~	*	~~Achieved~~ ~~-Maximum-~~

~~Chen~~	~~Europe, the Middle East and Africa, or EMEA, operating profit:~~~~2009 profit earned from our core business activities in EMEA, excluding interest and taxes.~~	*	~~Achieved~~ ~~-Below Threshold-~~
~~Mayes~~	~~SmartBusiness 200 (Cost Savings):~~~~Our second cost reduction~~Officer’s key initiative ~~to take an additional $100 million out of our cost structure by 2011.~~	~~• Threshold = $30 million~~ ~~• Target = $40 million~~ ~~• Maximum = $45 million~~	~~Achieved~~ ~~$49 Million~~ ~~-Maximum-~~
	~~Global service margin improvement:~~~~Service margin is the difference between our cost of providing services and revenue received for such services.~~	~~• Threshold = 0.5%~~ ~~• Target = 0.7%~~ ~~• Maximum = 1.0%~~	~~Achieved~~ ~~0.6%~~ ~~-Between Threshold~~ ~~and Target-~~

~~Ducey~~	~~Growth in Integrated Services~~^{^®}~~in U.S. from $95 million:~~~~Integrated Services~~^® ~~is our end-to-end outsourcing solution for financial institutions.~~	*	~~Achieved~~ ~~-Maximum-~~
~~Pierce~~	~~Remediation of material weaknesses in financial controls:~~ ~~In connection with the restatement of our financial statements in 2008 we determined that we had six material weaknesses in our financial controls.~~	~~• Threshold = 4 of 6~~ ~~• Target = 5 of 6~~ ~~• Maximum = 6 of 6~~	~~Achieved~~ ~~5+ of 6~~ ~~-Between Target~~ ~~and Maximum-~~
~~Krakora~~	~~Direct and assist in completion of 2009 strategic plan.~~	~~Subjective assessment~~	~~Achieved~~ ~~-Target-~~

As indicated above, management develops and proposes the key initiatives that are approved by the Committee. These key initiatives are based on strategic and operational objectives that are tied to our short- and long-term strategic and financial plans. These key initiatives have been selected because they ultimately lead to customer satisfaction and increased shareholder value. We believe that disclosing certain performance measures relating to specific division or business unit performance or other confidential strategic initiatives, which we do not otherwise disclose publicly, would cause us competitive harm by potentially disrupting our customer relationships and providing competitors with, among other things, insight into our business strategy, pricing margins and capabilities. We typically set target performance at a level that would provide results that are in line with our guidance to our investors or that are otherwise reasonably difficult to achieve relative to historical trends and future expectations at the time the levels are set. Threshold and maximum performance levels are then set to have slightly decreased and increased difficulty, respectively, as compared to target levels.

~~Individual Goals~~. ~~In addition to EPS and the key initiatives, each executive typically has from four to six individualized goals that can vary greatly amongst the executives and the Named Executive Officers. These~~ goals are ~~even more~~also indicated in the table below.

Individual performance goals and results: Individual goals are directly tied to the individual’s operating unit, functional area or department, and may consist of a ~~mixture~~combination of quantitative ~~measures (for example, revenue growth, cost reduction, cash conversion, quality improvement and inventory goals)~~ and qualitative ~~measures (for example, operational and organizational improvements, product/service development and customer loyalty).~~measures. The CEO develops and proposes the individual goals for his management team, which are approved by the Committee at the beginning of each fiscal year, and the Board sets the CEO’s individual performance objectives.

~~To the extent possible, individual quantitative~~ Individual goals are approved at threshold, target and maximum achievement ~~levels, similar to~~levels. The individual achievement goals for each Named Executive Officer are indicated in the ~~company goals~~table and ~~key initiatives. Further, similar to our company goals and key initiatives, quantitative individual goals may exclude certain non-recurring or extraordinary items. However, apart from~~footnote below, as well as the ~~overall weighting~~Board’s assessment of ~~individual goals relative to company goals and key initiatives, the Committee has no set criteria, formula or weighting system~~2012 achievement for ~~determining overall achievement of individual goals. Instead, the Committee bases its determination primarily on a subjective assessment made by~~ the CEO, and ~~reported to~~ the ~~Committee, on~~Committee’s assessment of 2012 achievement for the ~~overall achievement level of each executive’s individual goals, including the~~remaining Named Executive Officers. ~~Similarly, the Committee and the Board, make a~~

~~subjective assessment~~26

Table of ~~the CEO’s achievement of individual goals.~~

~~For 2009, the Committee approved the following individual goals for the Named Executive Officers (excluding Mr. Richardson):~~Contents

~~Named Executive Officer:~~

~~Individual Goals*:~~

~~Achievement:~~

~~Swidarski~~

~~• Successfully remediate material weaknesses~~

~~• Deliver SmartBusiness 200 $35 million cost reduction target~~

~~• Successfully release Enhanced-Note Acceptor within timing/reliability/cost framework~~

~~• Drive expansion of Integrated Services~~^® ~~globally, achieve $80 million in new contract value~~

~~• Realign global organizational structures to increase business performance and profitability~~

~~Achieved~~
~~-95% of Maximum-~~

~~Chen~~

~~• Drive AP cash conversion cycle improvement~~

~~• Drive EMEA cash conversion cycle improvement~~

~~• Deliver Integrated Services~~^® ~~revenue growth in EMEA/AP~~

~~• Achieve China product quality improvements~~

~~• Drive emerging markets flow share gain~~

~~Achieved~~
~~-95% of Maximum-~~

~~Mayes~~

~~• Deliver inventory turns improvement~~

~~• Quality improvements — reduction in defective ppm in manufacturing plants~~

~~• Successfully release Enhanced-Note Acceptor within timing/reliability/cost framework~~

~~• Support Oracle~~^® ~~and information technology plan within timing/cost framework~~

~~Achieved~~
~~-95% of Maximum-~~

~~Ducey~~

~~• Reduce Opteva~~^® ~~service call rate~~

~~• Drive growth in remote monitoring sites~~

~~• Support SmartBusiness 200 cost reduction target~~

~~• Drive service margin improvement in barrier security business~~

~~• Drive installation cost improvement~~

~~Achieved~~
~~-90% of Maximum-~~

~~Pierce~~

~~• Support SmartBusiness 200 cost reduction target~~

~~• Oversee successful completion of corporate accounting consolidation project~~

~~• Establish Balance Sheet monitoring policy/process/tools within global controllers’ organization~~

~~• Successfully implement revised controllers’ organization structure~~

~~• Support revisions to management and SEC reporting~~

~~• Support information technology and business transformation initiatives~~

~~Achieved~~
~~-95% of Maximum-~~

~~Krakora~~

~~• Direct and assist in continued efforts to divest Premier Election Solutions subsidiary~~

~~• Direct and assist in efforts to address enterprise and product level risk~~

~~Achieved~~
~~-90% of Maximum-~~


* Named Executive Officer & Goals		Weight	2012 Performance Threshold/Target/Maximum	2012 Achievement
Thomas W. Swidarski	Non-GAAP EPS:	50%	$2.20 / $2.50 / $2.80	Actual: $2.07 - Did not achieve
	Revenue Growth:	20%	Increase of: 2.5% / 5% / 7.5%	Actual: 5.9% increase - Achieved at target
	FCF:	10%	$130M / $150M / $170M	Actual: $85.8M - Did not achieve
	Individual Goals:¹	20%	--	Achieved at target
Bradley C. Richardson	Non-GAAP EPS:	50%	$2.20 / $2.50 / $2.80	Actual: $2.07 - Did not achieve
	FCF:	30%	$130M / $150M / $170M	Actual: $85.8M - Did not achieve
	Individual Goals:¹	20%	--	Achieved at target
Charles E. Ducey, Jr.	Non-GAAP EPS:	20%	$2.20 / $2.50 / $2.80	Actual: $2.07 - Did not achieve
	FCF:	20%	$130M / $150M / $170M	Actual: $85.8M - Did not achieve
	North America OP:¹	40%	--	Achieved between threshold and target
	Individual Goals:¹	20%	--	Achieved at target
George S. Mayes, Jr.	Non-GAAP EPS:	50%	$2.20 / $2.50 / $2.80	Actual: $2.07 - Did not achieve
	FCF:	15%	$130M / $150M / $170M	Actual: $85.8M - Did not achieve
	SB300:	15%	$30M / $35M / $40M	Actual: $35M - Achieved at target
	Individual Goals:¹	20%	--	Achieved at target
Frank A. Natoli, Jr.	Non-GAAP EPS:	50%	$2.20 / $2.50 / $2.80	Actual: $2.07 - Did not achieve
	SB300:	15%	$30M / $35M / $40M	Actual: $35M - Achieved at target
	Next Generation Roadmap:¹	25%	--	Achieved at target
	Individual Goals:¹	10%	--	Achieved at target
Leslie A. Pierce	Non-GAAP EPS:	50%	$2.20 / $2.50 / $2.80	Ms Pierce stepped down from the Company effective as of April 18, 2012, and therefore, this determination is not applicable.
	FCF:	15%	$130M / $150M / $170M
	SB300:	15%	$30M / $35M / $40M
	Individual Goals:¹	20%	--

^{_______________________________________________________}

As indicated above, management develops and proposes the individual goals that are approved by our Compensation Committee. These individual goals are based on strategic and operational objectives that are tied to the Company’s short- and long-term strategic and financial plans. These individual goals have been selected because they ultimately lead to customer satisfaction and increased shareholder value.

Although not all of these ~~individual~~ goals are quantitative in nature, for those that are, we believe that disclosing the quantitative performance measures relating to specific division or business unit performance or other confidential strategic initiatives, which we do not otherwise disclose publicly, would cause us competitive harm by potentially disrupting our customer relationships and providing competitors with, among other things, insight into our business strategy, pricing margins and capabilities. We typically set target performance at a level that would provide results that are in line with our guidance to our investors or that are otherwise reasonably difficult to achieve relative to historical trends and future expectations at the time the levels are set. Threshold and maximum performance levels are then set to have slightly decreased and increased difficulty, respectively, as compared to target levels. For 2012, the Committee approved the individual goals for the Named Executive Officers, as indicated in the table below. Management develops and proposes the individual goals that are approved by the Committee. These individual goals are based on strategic and operational objectives that are tied to the company’s short− and long−term strategic and financial plans. These individual goals have been selected because they ultimately lead to execution of strategic initiatives, customer satisfaction and increased shareholder value.

~~2009 Annual~~
Named Executive Officer Individual Goals Description
Thomas W. Swidarski ▪ MS/IS Infrastructure
▪ Build out infrastructure to support managed services and Integrated
   Services® growth.
Bradley C. Richardson
▪ IT/GBS Blueprint
   Compliance
▪ DRC Process
▪ Execute on financial transformation to support information technology
   and global business services Blueprint projects, among others.
▪ Continue growth of compliance program consistent with ongoing best
   practices and continue to enhance the DRC (see “Board Governance
   Committee Risk Oversight” above for more information on the DRC).
Charles E. Ducey, Jr.
▪ Electronic Security
   revenue and OP
▪ Achieve established Electronic Security revenue and OP goals.
George S. Mayes, Jr.
▪ Cable Print
▪ Product launches
▪ Execute goals related to our Belgium manufacturing operations.
▪ Execute successful launch of new products.
Frank A. Natoli, Jr.
▪ Next Generation Services

▪ Core solutions
▪ Enhance innovation projects within the company’s Next Generation plan
   and growth of managed services and Integrated Services.
▪ Achieve SB300 metrics and field reliability goals, as well as execution of
   priority projects.
Leslie A. Pierce
▪ Support FCF objectives
▪ Audit effectiveness
▪ Support DRC
▪ Reporting initiatives
▪ IT/GBS Blueprint
   Compliance
▪ Financial statement preparation, reporting and quality review.
▪ Establish and maintain certain audit controls.
▪ Develop and monitor key risk mitigation plans around financial risks.
▪ Increase internal and external financial reporting efficiencies.
▪ Optimize process to centralize Blueprint system, and support Blueprint
   development.

2012 Cash Bonus ~~Payout~~. ~~Based on~~Plan payouts earned: The table below reflects the cash bonuses earned by each Named Executive ~~Officers’~~Officer for 2012 performance achievement. As noted above, the company did not meet its non-GAAP EPS goal for 2012. Therefore, those cash bonus ~~opportunities (threshold / target / maximum as~~payouts that were paid in 2013 for 2012 performance did not include any amount for the weighted non-GAAP EPS component.

Table of Contents



Named Executive Officer	Actual Bonus Earned	Target Incentive	Actual as a % of Target
Thomas W. Swidarski	$0	$840,000	0%
Bradley C. Richardson	$0	$390,024	0%
Charles E. Ducey, Jr.	$0	$318,507	0%
George S. Mayes, Jr.	$149,093	$270,598	55%
Frank A. Natoli, Jr.	$117,283	$140,664	83%
Leslie A. Pierce	$0	$125,083	0%

Messrs. Swidarski, Richardson and Ducey each earned a ~~percentage~~cash bonus under some or all of ~~base salary), and~~ their ~~weighted achievement of the foregoing company goals,~~respective key initiatives and individual ~~goals,~~performance goals. However, the Committee ~~recommended,~~used its negative discretion to eliminate cash bonus payouts for these three executives. The Committee concluded that, given their respective roles and oversight responsibilities for the ~~Board approved,~~company, as a ~~payout~~result of the Committee’s assessment of the company’s overall performance in 2012, it was appropriate to eliminate cash bonuses for them. For Messrs. Mayes and Natoli, cash bonus payouts and their respective percent of target figures, were calculated based on their individual levels of achievement within their respective key initiatives and individual performance goals as ~~follows:~~

Cash Bonus
Weighting
Opportunity

(%) Achievement of
Achievement of
Achievement of
Base

Company Goals
Key Initiatives
Individual Goals
Total
Salary
Payout

Named Executive Officer:

Thresh.

Target

Max.

(50%)

(30%)

(20%)

(%)

($)

($)

Swidarski
40 100 200 24.8% + 60.0% + 38.0% = 122.8 % x 750,000 = 921,000
Chen
30 75 150 18.6% + 22.5% + 28.5% = 69.6 % x 351,754 = 244,821
Krakora
35 90 180 21.9% + 27.0% + 32.4% = 81.3 % x 320,000 = 260,160

Cash Bonus
Weighting
Opportunity

(%) Achievement of
Achievement of
Achievement of
Base

Company Goals
Key Initiatives
Individual Goals
Total
Salary
Payout

Named Executive Officer:

Thresh.

Target

Max.

(60%)

(20%)

(20%)

(%)

($)

($)

Mayes
30 75 150 22.3% + 30.0% + 28.5% = 80.8 % x 335,036 = 270,776
Ducey
30 75 150 22.3% + 22.5% + 27.0% = 71.8 % x 325,008 = 233,421
Pierce
20 50 100 14.9% + 15.0% + 19.0% = 48.9 % x 231,176 = 112,998

~~Long-Term Incentives~~

~~Overview~~. ~~The 1991 Plan provides us with flexibility~~related to the percentage weighting of each achievement (shown in the ~~types of~~tables above). Ms. Pierce stepped down from the company in April 2012, and therefore, was not eligible for a cash bonus.

Long-Term Incentives

The Committee believes in a balanced approach to long-term ~~incentives we can award~~incentive compensation. As such, our practice is to ~~our executives, including~~grant

total long-term incentive value according to the ~~Named Executive Officers, and includes~~following weights:

Restricted stock ~~options, performance shares, restricted stock and RSUs. The LTI granted in 2009 — collectively and individually — support our pay philosophy:~~units (RSUs): 20%


•	~~Stock options align our executives’ interests with those of shareholders because options only produce rewards to executives if our stock price increases after options are granted.~~

•	Performance shares reward our executives for achieving sustained financial results as well as for increasing our stock price. As a result, they tie rewards to performance and provide an additional means to own stock.

•	~~Special grants of restricted stockand/or~~ ~~RSUs help in attracting and retaining key executives. Normally, however, our LTI focus on options and performance shares.~~

Stock options: 40%

LTI opportunities are based largely on competitive practices of and benchmarking against our peer group. In addition, the Committee takes into account the competitiveness of our executives’ target cash pay (salary plus target bonus) and competitive total pay levels. This dollar difference represents the target value of LTI that the Committee delivers in the form of options and performance shares.Performance shares: 40%

~~Stock Options~~. ~~For 2009, approximately 50% of the target LTI was delivered in the form of stock options.~~ In this manner, the Committee strikes a balance ~~between~~of awards ~~tied only to stock price appreciation and those~~ based on the full value of our ~~Common Shares, as well as other~~shares, awards tied solely to stock price appreciation, and awards tied to performance ~~factors. LTI delivered in the form~~and stock price growth. The Committee believes this mix aligns our long-term incentive compensation with market practice, mitigates risk and enhances our shareholder alignment.

To determine annual award sizes of ~~stock options is valued using the Black-Scholes option valuation method, the same method we use to determine its accounting cost.~~

~~Grant guidelines are developed by management and then reviewed and approved by~~each type of long-term incentive, the Committee ~~and are based on an executive’s salary grade or level, organizational level, reporting relationships and job responsibilities in order~~considers individual performance, potential future contributions to ~~maintain~~our business, internal equity, and competitive market values, in addition to management’s recommendations. The Committee approves long-term incentive grants at the regular February Committee meeting, and actual grants ~~to participants. Actual grants also vary based~~are generally made on ~~an assessment of several factors, including~~ the market value of our Common Shares, our financial performance, shares available under the 1991 Plan, an individual’s target total compensation and his or her performance against individual performance goals. In addition, grants awarded to Mr. Richardson in 2009 took into account the value of equity awards and other benefits Mr. Richardson forfeited upon leaving his former job.

~~Our executives, including the Named Executive Officers, receive option grants with the following characteristics:~~


•	~~Non-qualified stock options, which provide us with a tax deduction at the time of exercise to the degree executives incur taxable income.~~

•	~~Exercise price equal to the closing price of our Common Shares on the date of grant so that executives do not receive options that are “in the money.”~~

•	~~Vest ratably over a four-year period to support executive retention.~~

•	~~Expire ten years after the date of grant to reward for long-term stock price appreciation.~~

~~Grants of stock options approved by the Committee to the Named Executive Officers during 2009 were as follows:~~


~~Named Executive Officer:~~	~~Stock Options Granted:~~
~~Swidarski~~		~~150,000~~
~~Richardson~~		~~30,000~~
~~Chen~~		~~15,000~~
~~Mayes~~		~~15,000~~
~~Ducey~~		~~15,000~~
~~Pierce~~		~~7,000~~
~~Krakora~~		~~25,000~~

The number of stock options granted to our Named Executive officers in 2009, reflected in the table above, approximates 50% of their target value of LTI, using the Black-Scholes option valuation method.

~~Performance Shares~~. ~~For 2009, the Committee delivered the remaining 50% of target LTI in the form of performance shares. Performance shares are earned over a three-year performance period, determined as~~day of the ~~date~~February Board Meeting.

RSUs: RSUs provide a base level of retention value in our ~~fourth quarter~~executive compensation program, and ~~year-end earnings release immediately following such performance period, with actual awards varying from target based on the achievement of financial objectives established by the Committee~~incentive for building shareholder value. RSUs provide additional value if our stock price appreciates and vest at the ~~start~~end of three years following the ~~period. No dividends are paid on performance shares until earned.~~

The award of performance shares in this way is consistent with the Committee’s objective to take a balanced approach to LTI by rewarding sustained financial performance as well as stock price appreciation.grant date. The expected value of ~~a performance share~~an RSU at the time of grant (based on our stock price) ~~determines~~is used to determine the number of ~~target performance shares potentially~~RSUs awarded. Dividend equivalents are paid on RSU awards.

Stock options: Stock options provide value based solely on stock price appreciation. Grants of stock options have a ten-year term and vest ratably over a four-year period. The ~~Committee then reviews and approves~~

~~the performance share grant guidelines developed by management, which are~~exercise price is based on the ~~same principles used to develop~~closing price of our common stock on the grant date and is valued using the Black-Scholes option ~~grant guidelines.~~valuation method.

~~Our executives, including the Named Executive Officers, received target~~Performance shares: The ultimate measure of our success is shareholder return, measured by stock price performance ~~share awards for the 2009 to 2011 period with the following characteristics:~~


•	Our TSR for the period relative to our peer group and the S&P Mid-Cap 400 Index determines the actual number of performance shares earned. Results in each area are weighted equally. This approach underscores the importance of providing shareholder returns equal to or greater than those companies similar to us as well as to the broader market of companies we compete with for investment. Moreover, it also balances the focus of stock options, the value of which is tied to the absolute growth in our stock price.

•	~~The actual number of shares earned will range from 0% to 200% of an individual’s target award:~~

•	If our relative TSR is below both group’s 20th percentile, no performance shares will be earned. As a result, the Committee requires executives to provide shareholders a minimally acceptable performance relative to our peers before any rewards can be earned.

•	Our executives can earn the maximum number of shares if our TSR equals or exceeds (1) the 60th percentile of one group and 100th percentile in the other, (2) the 70th percentile in one group and 90th percentile in the other, or (3) the 80th percentile of both groups. In this manner, our executives receive the highest level of rewards under the plan only when our performance is superior to that of other similar companies.

•	~~A matrix is used to determine awards for results between threshold and maximum.~~

•	~~An executive’s individual performance is not a factor in determining actual performance shares awarded.~~

~~Grants of performance~~and dividends. Performance shares ~~at target, approved by the Committee to the Named Executive Officers during 2009 were as follows:~~


~~Named Executive Officer:~~	~~Target Performance Shares Granted:~~
~~Swidarski~~		~~50,000~~
~~Richardson~~		~~5,625~~
~~Chen~~		~~7,500~~
~~Mayes~~		~~7,500~~
~~Ducey~~		~~7,500~~
~~Pierce~~		~~3,500~~
~~Krakora~~		~~12,500~~

~~The target performance shares granted to our Named Executive officers in 2009, reflected in the table above, approximates the remaining 50% of their target value of LTI.~~

~~Goals for the 2007 to 2009~~are earned over a three-year performance period ~~were identical to those established for the 2009 to 2011 period. However, unlike for the 2009 to 2011 performance period, the calculation of payouts for prior performance periods is determined by~~based solely on our ~~actual rank, as opposed to our percentile~~TSR ranking relative to our peer group and the S&P ~~Mid-Cap~~Midcap 400 Index. This approach underscores the importance of providing shareholder returns equal to or greater than those companies similar to us as well as to the broader market of companies we compete with for investment. Moreover, it also balances the focus of stock options, the value of which is tied to the absolute growth in our stock price. The ~~Committee changed to a percentile ranking methodology in 2009 for ease~~number of administration. In the past, when companies have dropped out of our peer group or the S&P Mid-Cap 400 Index during a performance period, it has not always been clear how best to adjust for such changes when using actual rankings. In certain situations, such as with a bankruptcy, it might be appropriate to assume poor performance and, therefore, deem the companies to have performedshares earned at the ~~bottom~~completion of the ~~rankings. However, in other situations, it~~performance cycle may ~~be less clear, such as in the case~~range from 0% to 200% of ~~a merger or acquisition. Changing to percentile rankings removes the ambiguity.~~

As discussed above, our actual TSR for the 2007 to 2009 performance period was ranked 24th out of an original peer group (discussed above) comprised of 31 companies, and 241st in the S&P Mid-Cap 400 Index, which produced a payout equal to 55% of each executive’s target, ~~award. Our executives received shares equal to this percent of target, as no discretion was used to increase or decrease the results~~ based on our relative ~~TSR. Accordingly,~~ranking against these two groups of companies. No dividends are paid until shares are earned.

For the grant covering the 2010 to 2012 performance period:


▪	The performance period began on January 1, 2010 and ended on the date of our year-end earnings release in 2013 following the completion of the 2012 fiscal year.

Table of Contents

▪

The minimum performance requirement was the 20^th percentile against both our peer group and the S&P Midcap 400 Index (25% payout is earned at minimum). The maximum performance requirements were: (a) the 60^th percentile of one group and highest ranking in the other, (b) the 70^th percentile in one group and 90^th percentile in the other, or (c) the 80^th percentile of both groups (200% payout is earned at maximum).

For grants starting in 2011, the Committee approved the following changes:

The end of the performance period is December 31st of the third year, and the stock prices used to determine the starting and ending points are based on the trailing 20-day average stock price immediately preceding both the January 1st start date and the December 31st ending date.

The minimum performance requirement was raised to 35th percentile of both groups. The maximum performance requirement was solidified as the 80th percentile of both groups.

Our TSR for the 2010 to 2012 performance period was 20.4%, which ranked in the 23rd percentile versus our peer group of 44 companies from 2010, and the 27th percentile versus the S&P Midcap 400 Index. The corresponding payout from the Committee-approved performance/payout scale was 30% of each Named Executive Officer’s target grant. The Committee did not exercise negative discretion to adjust the final award.



Named Executive Officer	2010 - 2012 Performance Shares Granted at Target	2010 - 2012 Performance Shares Actually Earned	% of Target
Thomas W. Swidarski	42,500	12,750	30%
Bradley C. Richardson	6,500	1,950	30%
Charles E. Ducey, Jr.	5,500	1,650	30%
George S. Mayes, Jr.	5,500	1,650	30%
Frank A. Natoli, Jr.	2,000	600	30%
Leslie A. Pierce¹	2,750	642	30%

____________________________

¹ Pursuant to her separation agreement, as further discussed in “Employment and Separation Agreements” below, Ms. Pierce’s 2010 to 2012

performance shares actually earned for 2012 have been pro-rated in this table based on the length of her employment in 2012.

2012 Long-Term Incentives: The Committee performed a thorough review of competitive market data for each Named Executive Officer, individual and company performance, and management’s recommendations. Based on that review and the Committee’s objective to deliver 50^th percentile total compensation, the Committee approved the following equity grants to our Named Executive Officers in 2012:



Named Executive Officer	Stock Options	Performance Shares at Target¹	RSUs
Thomas W. Swidarski	174,000	52,000	24,000
Bradley C. Richardson	40,000	12,000	5,500
Charles E. Ducey, Jr.	40,000	12,000	5,500
George S. Mayes, Jr.	25,000	7,500	4,500
Frank A. Natoli, Jr.	16,500	5,000	2,300
Leslie A. Pierce²	7,250	2,500	1,250

_________________________


¹	Actual performance share awards ultimately granted to Mr. Ducey for the 2012 to 2014 performance period will be pro-rated pursuant to his separation agreement, as further discussed in “Employment and Separation Agreements” below.


²	Pursuant to her separation agreement, as further discussed in “Employment and Separation Agreements” below, Ms. Pierce received all of the stock options indicated in this table; however, she only received a pro-rated portion of these 2012 performance shares at target and 2012 RSUs, which amount to 278 and 104, respectively.

Table of Contents

Executive Stock Ownership Guidelines

The Committee believes that stock ownership guidelines reinforce executive and shareholder alignment. Our executive stock ownership guidelines are:

CEO: Five times salary

CEO direct reports: Three times salary

Performance share participants: One and a half times salary

Executives must retain at least 50% of the net shares of stock received from any equity-based awards, after deductions for taxes and exercise costs, until the guidelines are met. After the guidelines are met, executives must hold at least 50% of the net shares of stock received from any equity-based awards, after such deductions, for at least one year.

In determining an executive’s stock holdings, we count the shares beneficially owned by the executive, including the after-tax value of the following stock equivalents: RSUs, shares deferred pursuant to our deferred compensation program (discussed below in “Non-Qualified Deferred Compensation”), and shares owned through the executive’s 401(k) savings plan account. Outstanding options and unearned performance shares do not count toward the executives’ stock ownership guidelines.

The Committee reviews management’s stock holdings annually to monitor progress toward the stock ownership guidelines. However, we do not impose any penalties on executives who fail to meet the stock ownership guidelines. This is because the guidelines mandate some level of stock ownership whenever an executive would realize any value from an equity-based award. Moreover, we do not allow executives to hedge the economic risk associated with stock ownership. The stock holdings of the Named Executive Officers ~~for the 2007~~are set forth above under “Security Ownership of Directors and Management.”

2013 Compensation Decisions

In an ongoing effort of continuous improvement, our commitment to ~~2009 performance period were as follows: Thomas W. Swidarski, 11,000 shares; James L. M. Chen, 2,750 shares; George S. Mayes Jr., 2,750 shares; Charles E. Ducey Jr., 2,750;~~becoming a “top tier” performer, support of our longer-term business strategy, and ~~Kevin J. Krakora, 5,500 shares.~~

~~Restricted Stock and RSUs~~. ~~At times, we may hire new executives or a current executive may take on a new role or greatly expanded responsibilities. As a result,~~enhancement our pay-for-performance alignment, the Committee ~~believes that it is sometimes important~~approved the following program modifications for 2013 to provide such executives with an additional incentive in the form of restricted stock or RSUs. These awards typically vest three years after the date of grant and may include performance features for early vesting. The purpose of these awards is to ensure retention of the executives’ services for a specified period of time and to enhance their incentive for building shareholder value. In furtherance of thesegreater focus on critical strategic objectives:

purposes, in 2009, Mr. Richardson was awarded 12,500 RSUs as a newly hired executive. The value of these RSUs was intended, in part, to provide compensation for the value of equity awards and other benefits Mr. Richardson forfeited upon leaving his former job. In addition, for similar reasons Mr. Richardson was given a sign-on bonus of $250,000, payable at his discretion in cash or RSUs, with a 20% increase in value if he chose RSUs. Mr. Richardson decided to take the sign-on bonus in the form of an additional 11,350 RSUs. Providing the sign-on bonus in the form of RSUs allows the company to expense the value over the three-year term of the RSUs, instead of all at once, and also enabled Mr. Richardson to accelerate progress in meeting his stock ownership requirements. None of the other Named Executive Officers received restricted stock or RSUs in 2009.



Plan		Comments
Annual Cash Bonus		Non-GAAP EPS will continue to be an important measurement for some executives. However, performance measurements for most executives will focus on FCF.
Stock Options		Modified vesting from four years to three years, ratable, for alignment with our performance shares and RSUs.
Long-Term Incentives		Increased the performance share weighting to 50% of our total long-term incentive opportunity. Stock options were lowered to 30% weighting. RSUs remained at 20% weighting.
Company Car Program		Eliminated effective March 2013, except for specific positions that need a car for business purposes. The Named Executive Officers will no longer participate in the program.

~~Perquisites and Other~~ Personal Benefits

Our executives, including the Named Executive Officers, ~~are also eligible to~~ participate in the following ~~additional pay elements as part of their total pay package.~~programs:

Benefits

We provide ~~our~~ executives with medical, dental, long-term disability, and life insurance ~~and severance benefits~~ under the same programs used to provide benefits to allU.S.-based associates. Our executives may buy additional life insurance coverage at their own ~~expense, but not long-term disability.~~expense. The maximum life insurance coverage that may be ~~bought~~purchased by an executive is $1.5 million. Our executives’ personal benefits are not tied to individual or company performance ~~which is the same approach used for other associates. Moreover,~~and changes to ~~our executives’~~these benefits reflect the changes to the benefits of ~~other~~all U.S.-based associates.

Perquisites

We provide our executives with ~~perquisites that are also not tied to individual or company performance.~~limited perquisites. The Committee believes that these benefits are set at a reasonable level, are highly valued by recipients, have limited cost to the company, are part of a competitive reward ~~program~~system, and help in

Table of Contents

attracting and retaining ~~high quality executives. Our~~top management talent. Perquisites received by executives ~~receive~~include the following, ~~perquisites,~~ the values of which differ based on an executive’s reporting level:

Country club memberships, which are anticipated to be used for business as well as personal purposes. As of December 2008, this perquisite was discontinued for all of our Named Executive Officers, except our CEO, as it was felt that he, more so than our other executives, would benefit from the business development and networking opportunities provided by his club memberships.


•	Company car or car allowance, including a repair and maintenance allowance, and insurance allowance, although this perquisite is being phased out except for a limited number of grandfathered positions, which include each of the Named Executive Officers, except Ms. Pierce.

•	Country club memberships, which are anticipated to be used for business as well as personal purposes. As of December 2008, this perquisite has been discontinued for all of our executives, except our CEO, as it was felt that he, more so than our other executives, would benefit from the business development and networking opportunities provided by his club memberships.

•	~~Reimbursement for financial planning services to assist executives in managing the rewards earned under our programs.~~

•	A complete annual physical exam (assessment of overall health, screening and risk reviews for chronic diseases, exercise and dietary analysis, and other specialty consultations), which helps protect in small measure the investment we make in these key individuals.

Reimbursement for financial planning services.

A complete annual physical exam (assessment of overall health, screening and risk reviews for chronic diseases, exercise and dietary analysis, and other specialty consultations), which helps protect in small measure the investment we make in these key individuals.

Company car program, or car allowance, which is being eliminated for all executives, including the Named Executive Officers, effective March 2013.

The Committee periodically reviews our practices in this area and makes any necessary adjustments based on ~~competitive practices, consistency with our total pay philosophy~~market trends and ~~objectives, and~~the cost to provide these ~~personal~~ benefits. ~~As a result of the Committee’s review, beginning in 2008, we no longer provide taxgross-ups~~ ~~in connection with any executive perquisites. The trend in our peer group and in the market is to discontinue the practice of providing taxgross-ups~~ ~~in connection with executive perquisites and, further, providing taxgross-ups~~ ~~on perquisites is not consistent with our global cost reduction efforts.~~

Deferred Compensation

Our executives, including the Named Executive Officers, ~~have the ability~~may elect to defer receipt of annual cash bonuses and performance shares pursuant to our Deferred Incentive Compensation Plan. Current investment choices under the plan for cash deferrals (cash bonuses and dividends on deferred performance shares) mirror those in our 401(k) plan, except it does not include our ~~Common Shares. As a result, the plan offers our executives another means to save for retirement.~~common shares. Our deferred compensation plan does not provide participants with additional pay, but merely provides a tax deferred investment vehicle. ~~Deferrals represent earned incentives that would have been paid to the executive except for the voluntary election of the~~

~~executive.~~ Moreover, we do not guarantee any specific rate of return and do not contribute to the return that may be earned. ~~As a result, the current program does not increase our compensation costs.~~

Retirement

We ~~also~~ maintain qualified and non-qualified retirement programs. Our executives, including the Named Executive Officers, participate in our qualified defined benefit (pension) and defined contribution (401(k)) plans on the same terms as all ~~other~~U.S.-based associates. ~~Under~~In January 2012, in order to better align with market practice, we enhanced our 401(k) ~~plan,~~match as follows: for ~~executives~~employees hired prior to July 1, 2003, we ~~have historically matched 60%~~match 30% of the first 3%6% of pay ~~that was~~ contributed, ~~by the associate to the plan,~~ and ~~40% of the next 3% of pay contributed. For executives~~for employees hired on or after such date, we have historically matched 100% of the first 3% of pay that was contributed by the associate to the plan, and 60% of the next 3% of pay contributed. However, as a result of the global economic downturn beginning in late 2008, in early 2009 we discontinued our 401(k) match ~~for all associates hired prior to July 1, 2003, and reduced our 401(k) match for all associates hired after July 1, 2003 to~~ 60% of the first 3%6% of pay ~~contributed by the associate. It is our hope to reinstate all aspects of the 401(k) match at some point during 2010.~~contributed.

We also have ~~five~~four non-qualified supplemental retirement ~~plans as follows: the Supplemental Employee Retirement Plan I, or SERP I,~~plans: (1) the Pension Supplemental Executive Retirement Plan, or Pension SERP, (2) the Pension Restoration Supplemental Executive Retirement Plan, or Pension Restoration SERP, (3) the 401(k) Restoration Supplemental Executive Retirement Plan, or 401(k) Restoration SERP, and (4) the 401(k) Supplemental Executive Retirement Plan, or 401(k) ~~SERP, although none of the Named Executive Officers are in the SERP I, and the SERP I is now closed to new participants.~~

SERP. These plans are described in detail below under “~~2009~~2012 Pension and Retirement Benefits.”

Participation in the 401(k) Restoration SERP is based on the annual IRS compensation limits. Participation in the other plans is limited to executive officers in positions that help develop, implement and modify our long-term strategic plan, as nominated by the CEO and approved by the Committee.

~~Mr.~~ Messrs. Swidarski ~~Mr.~~and Ducey ~~and Mr. Krakora~~ participate in the Pension SERP, Pension Restoration SERP, and the 401(k) Restoration SERP; however, ~~any~~based on design, benefits accrued under the Restoration SERPs ~~offset benefits accrued under~~and the Pension SERP ~~to avoid duplication of benefits provided. Mr.~~are not duplicative. Messrs. Richardson and ~~Mr.~~ Mayes participate in the 401(k) Restoration SERP and the 401(k) SERP. Ms. Pierce participates in the Pension Restoration SERP and the 401(k) Restoration SERP. Mr. Natoli participates in the 401(k) Restoration SERP.

~~Employment Agreements~~Change-in-Control Protection

We ~~typically only enter into employment~~maintain change-in-control agreements with the CEO and also the President when that title is held by someone other than the CEO. When an employment agreement is deemed necessary, the Committee usually models the agreement after prior employment agreements, and makes adjustments as necessary given, among other factors, a competitive analysis of the market for the position, our needs and the relative experience level of the individual accepting the position. These employment agreements may then go through a negotiation process with the individual and his or her legal counsel.

~~Mr. Swidarski’s employment agreement is described in more detail below under “~~~~Narrative Disclosure to 2009 Summary Compensation Table and 2009 Grants of Plan-Based Awards Table~~~~” and a copy of his amended and restated agreement has been filed as Exhibit 10.28 to our Annual Report onForm 10-K~~ ~~for the year ended December 31, 2008.~~

~~Change-in-Control~~ ~~Benefits~~

~~We have an historical practice of providingchange-in-control~~ ~~agreements to~~ our executive officers, including the Named Executive ~~Officers. These agreements~~Officers, that provide our executives with the potential for continued employment for three years following achange-in-control. As a result, these agreements help retain these executives and provide for management continuity in the event of an actual or threatenedchange-in-control of the company. They also help ensure that our executives’ interests remain aligned with shareholders’ interests during a time when their continued employment may be in jeopardy. Finally, they provide some level of income continuity should an executive’s employment be terminated without ~~cause.~~cause in connection with a change-in-control.

The agreements provide:

Severance of three times salary for the CEO, and two times salary for the other Named Executive Officers.


•	~~Severance of three times salary for the CEO and two times salary for the other Named Executive Officers and other executives.~~

•	~~One year of continued participation in employee retirement income, health and welfare benefit plans, including all executive perquisites.~~

•	~~One year of additional service for determining the executives’ non-qualified retirement benefits.~~

Severance of two times salary and ~~any~~target bonus for the CEO, and one and a half times salary and target bonus for the other factors the Committee deems relevant. These separation agreements generally then go through a negotiation process with the individual and his or her legal counsel. These agreements are only prepared at the time of an executive’s separation from the company, and as such, do not affect the Committee’s decisions on other compensation elements.

~~Expatriate Benefits~~

~~Stock Ownership Guidelines~~

~~executives’ salaries and our stock price on October 5, 2006, and are as follows:~~


•	~~Chief Executive Officer: 130,000 shares;~~

•	~~President and Chief Operating Officer: 100,000 shares;~~

•	~~Executive and Senior Vice Presidents: 50,000 shares;~~

•	~~Vice Presidents and Group Vice Presidents: 25,000 shares; and~~

•	~~Other Senior Management: 15,000 shares.~~

In addition, until guidelines are met, our executives must hold at least 80% of the net shares of stock received from any equity-based awards, after deductions for taxes and exercise costs. Once the guidelines are met, our executives are required to hold at least 40% of the net shares of stock received from any equity-based awards, after such deductions.

In determining an executive’s stock holdings, we count the shares directly owned by the executive, including unvested restricted shares and shares deferred pursuant to our deferred compensation program,Separation Agreements” below), as well as a pro-rated bonus payment in the ~~following stock equivalents: deferred shares/RSUs~~year of termination, based on actual performance.

Employment and Separation Agreements

~~Examples of such detrimental conduct include:~~

~~Company-Imposed Black-Out Periods~~

~~Limitations~~Annual Report on ~~Deductibility of Compensation~~

paid by a public company to its CEO and certain other highly compensated executive officers to $1 million in the year the compensation becomes taxable to the executive. There is an exception to the limit on deductibility for performance-based compensation that meets certain requirements.

In order to qualify as performance-based compensation, our compensation plans must meet certain requirements, including shareholder approval. We have taken steps intended to ensure we are not adversely affected by Section 162(m). To that end, our annual bonuses, grants of performance shares and awards of stock options are designed to meet the section’s deductibility requirements. Nevertheless, the Committee also believes that it must maintain flexibility to take actions that it deems to be in our best interests, but that may not qualify for tax deductibility under Section 162(m).

Base salaries and grants of restricted stock and RSUs do not qualify as performance-based compensation and would not be excluded from the limitation on deductibility. As a result, we have a policy pursuant to which certain executives have entered into agreements to automatically defer amounts affected by the $1 million limitation until the time when that limitation no longer applies.

~~COMPENSATION-RELATED RISK~~

At the request of our Compensation Committee, management has undertaken a review and evaluation of our compensation policies and practices applicable to all employees that may create risks for our company. Participating in this review were members of our human resources, legal, finance and internal audit departments. In connection with this review, the Compensation Committee also engaged its independent compensation consultant, Towers Watson, to conduct a comprehensive risk assessment of our executive compensation policies and practices.

The results of these reviews and assessments were presented to the Compensation Committee for its review and final assessment. Consequently, we have determined that our compensation policies and practices do not create risk that is reasonably likely to have a material adverse effect on the company.

~~EXECUTIVE COMPENSATION~~

~~The table below summarizes the total compensation paid or earned by each of our Named Executive Officers~~Form 10-K for the ~~fiscal years~~year ended December 31, ~~2009, 2008 and 2007. The amounts shown include compensation for services in all capacities that were provided to us.~~2008.

~~2009 Summary Compensation~~ Table of Contents

Change in Pension

Value and Non-

Non-Equity
qualified Deferred

Stock
Option
Incentive Plan
Compensation
All Other

Salary¹ Bonus² Awards³ Awards⁴ Compensation⁵ Earnings⁶ Compensation⁷ Total
Name and Principal Position Year ($) ($) ($) ($) ($) ($) ($) ($)
Thomas W. Swidarski
2009 750,000 0 1,158,000 1,177,440 921,000 474,000 114,410 4,594,850
President and Chief Executive 2008 750,000 0 765,900 860,700 1,500,000 658,000 172,587 4,707,187
Officer 2007 687,111 365,913 2,836,200 2,178,300 0 177,000 70,835 6,315,359

Bradley C. Richardson
2009 51,609 60,625 773,518 269,397 0 0 20,856 1,176,005
Executive Vice President and 2008 - - - - - - - -
Chief Financial Officer ⁸
2007 - - - - - - - -

James L.M. Chen
2009 340,248 0 173,700 117,744 244,821 0 724,820 1,601,333
Executive Vice President, 2008 328,742 0 344,655 71,725 486,538 0 203,869 1,435,529
International Operations 2007 292,215 117,721 236,350 137,959 0 0 236,864 1,021,109

George S. Mayes, Jr.
2009 329,277 0 173,700 117,744 270,776 0 188,333 1,079,830
Executive Vice President, 2008 300,481 0 153,180 71,725 444,712 0 103,489 1,073,587
Global Operations 2007 - - - - - - - -

Charles E. Ducey, Jr.
2009 308,706 0 173,700 117,744 233,421 229,000 40,011 1,102,582
Executive Vice President, 2008 - - - - - - - -
North America Operations 2007 - - - - - - - -

Leslie A. Pierce
2009 305,922 0 81,060 54,947 112,998 42,000 10,698 607,625
Former Interim Chief 2008 - - - - - - - -
Financial Officer ⁹
2007 - - - - - - - -

Kevin J. Krakora
2009 353,720 0 289,500 196,240 260,160 189,000 40,718 1,329,338
Former Chief Financial 2008 377,805 0 319,125 179,313 680,049 254,000 77,167 1,887,459
Officer ¹⁰
2007 375,354 0 590,875 363,050 0 127,000 38,668 1,494,947


¹		~~For Ms. Pierce, the amount reflected in the “Salary” column includes a one-time salary adjustment for her role as interim CFO in the amount of $74,746.~~

²		For Mr. Richardson, the amount reflected in the “Bonus” column represents a pro-rated bonus for 2009 pursuant to his offer of employment, based on target EPS results under the Annual Cash Bonus Plan.

³		For 2009, this column represents the aggregate grant date fair value, computed in accordance with FASB ASC Topic 718, for performance shares and RSUs awarded to the Named Executive Officers in 2009, as reflected below under “~~2009 Grants of Plan-Based Awards~~.” Pursuant to SEC rules, the amounts shown exclude the impact of estimated forfeitures related to service-based vesting conditions. For the performance shares, such amounts are based on the probable outcome of the relevant performance conditions as of the grant date. The maximum number of performance shares that may be earned is also reflected below under “~~2009 Grants of Plan-Based Awards,~~” the grant date fair value of which would be: for Mr. Swidarski, $2,316,000; for Mr. Richardson, $286,326; for Mr. Chen, $347,400; for Mr. Mayes, $347,400; for Mr. Ducey, $347,400; for Ms. Pierce, $162,120; and for Mr. Krakora, $570,000. The specific terms of the performance shares and RSUs are discussed in more detail above under “~~Compensation Discussion and Analysis.~~” For performance shares and RSUs awarded to the Named Executive Officers in 2008 and 2007, the grant date fair values have been recomputed in accordance with FASB ASC Topic 718. For additional information on performance shares and RSUs awarded to the Named Executive Officers in prior years, see below under “~~Outstanding Equity Awards at 2009 Fiscal Year-End~~~~.” These amounts reflect the grant date fair value for these awards, and do not necessarily correspond to the actual value that will be realized by the Named Executive Officers.~~

⁴		For 2009, this column represents the aggregate grant date fair value, computed in accordance with FASB ASC Topic 718, for stock options granted to the Named Executive Officers in 2009, as reflected below under “~~2009 Grants of Plan-Based Awards~~.” Pursuant to SEC rules, the amounts shown exclude the impact of estimated forfeitures related to service-based vesting conditions. The assumptions used in calculating the fair value of these stock options can be found under Note 3 to the Consolidated Financial Statements in our Annual Report on~~Form 10-K~~ ~~for the year ended December 31, 2009. The specific terms of the stock options are discussed in more detail above under “~~~~Compensation Discussion and Analysis.~~” For stock options awarded to the Named Executive Officers in 2008 and 2007, the grant date fair values have been recomputed in accordance with FASB ASC Topic 718. For additional information on stock options awarded to the Named Executive Officers in prior years, see below under “~~Outstanding Equity Awards at 2009 Fiscal Year-End~~~~.” These amounts reflect the grant date fair value for these awards, and do not necessarily correspond to the actual value that will be realized by the Named Executive Officers.~~


⁵		For 2009, this column reflects amounts earned by the Named Executive Officers under our Cash Bonus Plan for the 2009 fiscal year, but that were not actually paid out until February 2010. For a more detailed description of the related performance measures for the Cash Bonus Plan, see above under “~~Compensation Discussion and Analysis.~~”

⁶		For 2009, these amounts shown are the difference between the value of pension benefits earned as of December 31, 2009 based on a 6.33% discount rate and the RP-2000 Combined Healthy Mortality Table with mortality improvement to December 31, 2009 based on Scale AA and the value of pension benefits earned as of December 31, 2008 based on a 6.41% discount rate and the RP-2000 Mortality Table with no mortality improvement. Further, the values were determined assuming the probability is nil that the Named Executive Officer will terminate, retire, die or become disabled before normal retirement date. There was no above-market or preferential interest earned by any Named Executive Officer in 2009 on non-qualified deferred compensation.

⁷		~~For 2009, the amounts reported for “~~~~All Other Compensation~~” consist of amounts provided to the Named Executive Officers as outlined in the table below, with respect to (a) the use of an automobile or cash in lieu thereof for Mr. Chen, this amount includes the cost of a driver, (b) club memberships for Mr. Swidarski, (c) the dollar value of insurance premiums paid by us for the benefit of the executive, (d) amounts contributed for the executive by us under our 401(k) plan and any non-qualified defined contribution plan for which the executive is a participant, (e) financial planning services/tax assistance, (f) dividend equivalents paid on unvested RSUs, and (g) other. For Mr. Mayes, the amount in column (d) reflects a one-time adjustment to include the $74,519 401(k) SERP contribution made in 2009 for the 2008 fiscal year. For the Named Executive Officers, excluding Mr. Richardson and Mr. Chen, the amount in column (g) reflects the approximate value of an annual physical exam provided to our executives. For Mr. Richardson, the amount in column (g) reflects miscellaneous benefits. For Mr. Chen, the amount in column (g) includes the following expatriate cost of living allowances for the location of his residence in Shanghai, China: a housing allowance in the amount of $111,000; a goods and services allowance in the amount of $37,000; a one-time allowance of $45,793; pension payments in the amount of $51,037; tax payments of $387,772; and miscellaneous other benefits totaling $64,021.

All Other Compensation
Names (a) (b) (c) (d) (e) (f) (g)
Thomas W. Swidarski
23,400 22,664 2,346 6,900 15,000 41,600 2,500
Bradley C. Richardson
2,961 0 0 14,145 0 0 3,750
James L.M. Chen
26,052 0 0 0 0 2,145 696,623
George S. Mayes, Jr.
14,256 0 1,108 156,622 9,167 4,680 2,500
Charles E. Ducey, Jr.
14,256 0 1,075 7,500 10,000 4,680 2,500
Leslie A. Pierce
0 0 480 7,350 0 368 2,500
Kevin J. Krakora
11,750 0 1,427 7,500 9,741 7,800 2,500


⁸		~~Mr. Richardson was appointed Executive Vice President and Chief Financial Officer effective as of November 23, 2009.~~

⁹		~~Ms. Pierce served as interim Chief Financial Officer from March 25, 2009 through November 22, 2009, and she currently serves as Vice President and Corporate controller.~~

¹⁰		~~Mr. Krakora served as Executive Vice President and Chief Financial Officer until stepping down as of March 25, 2009, and he currently serves as Executive Vice President, Corporate Development.~~

~~2009 Grants of Plan-Based Awards~~

All Other Stock
All Other Option
Grant Date Fair

Awards: Number
Awards: Number of
Exercise or Base
Value of Stock

Estimated Possible Payouts Under Non-
of Shares of Stock
Securities Underlying
Price of Option
and Option

Equity Incentive Plan Awards¹ Estimated Future Payouts Under Equity Incentive Plan Awards² or Units³ Options⁴ Awards
Awards⁵
Name Grant Date Thresh. ($) Target ($) Max. ($) Thresh. (#) Target (#) Max. (#) (#) (#) ($/Sh) ($)

Thomas W. Swidarski
2/11/2009 - - - - - - - 150,000 24.79 1,177,440
3/26/2009 - - - 12,500 50,000 100,000 - - - 1,158,000
2/11/2009 300,000 750,000 1,500,000 - - - - - - -
Bradley C. Richardson
11/23/2009 - - - - - - - 30,000 26.43 269,397
11/23/2009 - - - - - - 23,850 - - 630,356
11/23/2009 - - - 1,406 5,625 11,250 - - - 148,669
11/23/2009 12,125 30,313 60,625 - - - - - - -
James L.M. Chen
2/11/2009 - - - - - - - 15,000 24.79 117,744
3/26/2009 - - - 1,875 7,500 15,000 - - - 173,700
2/11/2009 64,873 170,124 324,363 - - - - - - -
George S. Mayes, Jr.
2/11/2009 - - - - - - - 15,000 24.79 117,744
3/26/2009 - - - 1,875 7,500 15,000 - - - 173,700
2/11/2009 68,050 164,639 340,248 - - - - - - -
Charles E. Ducey, Jr.
2/11/2009 - - - - - - - 15,000 24.79 117,744
3/26/2009 - - - 1,875 7,500 15,000 - - - 173,700
2/11/2009 65,855 154,353 329,277 - - - - - - -
Leslie A. Pierce
2/11/2009 - - - - - - - 7,000 24.79 54,947
3/26/2009 - - - 875 3,500 7,000 - - - 81,060
2/11/2009 61,184 152,961 305,922 - - - - - - -
Kevin J. Krakora
2/11/2009 - - - - - - - 25,000 24.79 196,240
3/26/2009 - - - 3,125 12,500 25,000 - - - 289,500
2/11/2009 113,342 340,025 680,049 - - - - - - -


¹		These columns present information about the potential payout under our Cash Bonus Plan for fiscal year 2009 (for Mr. Richardson, the amounts shown are prorated for 2009). The actual amount paid in February 2010 is reflected above in the “~~2009 Summary Compensation Table~~~~” under the column “Non-Equity Incentive Plan Compensation.” For a more detailed description of the related performance measures for our Cash Bonus Plan, see above under “~~~~Compensation Discussion and Analysis.~~”

²		These columns present information about performance shares awarded during 2009 pursuant to the 1991 Plan (for Mr. Richardson, the minimum, target and maximum performance share payouts have been prorated for the 2009 to 2011 performance period). The performance measures will be calculated over the three-year period beginning on February 4, 2009 through the day of our year-end earnings release in January 2012. No amount is payable unless the threshold performance is exceeded. The maximum award amount, which can be up to 200% of the target amount, will be earned only if we achieve maximum performance. For a more detailed description of the performance shares and the related performance measures, see above under “~~Compensation Discussion and Analysis.~~”

³		~~This column presents information about RSUs awarded during 2009 pursuant to the 1991 Plan. For a more detailed description of the RSUs, see above under “~~~~Compensation Discussion and Analysis.~~”

⁴		All stock option grants were new and not granted in connection with an option re-pricing transaction, and the terms of the stock options were not materially modified in 2009. For a more detailed description of the stock options, see above under “~~Compensation Discussion and Analysis.~~”

⁵		The value of performance shares and RSUs was calculated using the closing market price of the shares on the grant date of $23.16 ($26.43 for Mr. Richardson), and reflects the total amount that we would expect to expense in our financial statements over the awards’ three-year performance period, based on the probable outcome of the performance conditions, excluding the effect of estimated forfeitures, in accordance with FASB ASC Topic 718. For stock options, the fair value is calculated using the Black-Scholes value on the grant date of $7.85 ($8.98 for Mr. Richardson), calculated in accordance with FASB ASC Topic 718. The assumptions used in calculating the fair value of these stock options can be found under Note 3 to the Consolidated Financial Statements in our Annual Report on~~Form 10-K~~ ~~for the year ended December 31, 2009.~~

~~Narrative Disclosure to 2009 Summary Compensation Table~~
~~and 2009 Grants of Plan-Based Awards Table~~

~~Many of the details on the amounts for the Named Executive Officers reflected in the “~~~~2009 Summary Compensation Table~~~~” and the “~~~~2009 Grants of Plan-Based Awards~~~~” table are discussed in the footnotes to the tables or elsewhere in this proxy statement (for example, above under “~~~~Compensation Discussion and Analysis~~~~”). However, the following narrative is intended to further clarify these amounts or provide further explanation about the decision-making process relative to these amounts.~~

~~Mr. Swidarski’s Employment Agreement~~

In April 2006, we entered into anthis employment agreement with Mr. Swidarski, with a term of two

years and with automatic one-year renewals thereafter unless either party ~~notifies~~notified the other at least six months before the scheduled expiration date that the term iswas not to renew. Pursuant to his agreement, Mr. Swidarski was to receive a base salary of $550,000 for the first year, with a cash bonus opportunity up to 200% of base salary, as well as other compensation. Further, ~~as part of his employment agreement,~~ Mr. Swidarski ~~is also~~was entitled to ~~the following perquisites:~~ a monthly ~~auto~~car allowance up to ~~$3,295;~~$3,295, financial planning and tax preparation services up to $20,000 ~~annually;~~annually, country club dues and ~~fees;~~fees, and an annual physical examination. ~~Mr. Swidarski had previously been entitled~~

As a result of a termination without cause, pursuant to ~~a taxgross-up~~ on his ~~auto allowance, but he agreed to the discontinuance of this benefit in 2008.~~

~~In the event that Mr. Swidarski is terminated without cause,~~employment agreement, he is entitled to receive severance payments, including: a lump sum amount equal to two years base salary; a lump sum amount equal to twice his target annual cash bonus for the year in which termination occurs; a pro rata annual cash bonus for the year in which termination occurs, but only to the extent an annual cash bonus is paid to others for the year of termination; and continued participation in our employee benefits plans for a period of two years (not including any qualified or non-qualified pension plan or 401(k) plan). Mr. Swidarski is also subject to non-competition and non-solicitation obligations for a period of two years following his termination of employment, as well as a perpetual obligation of confidentiality, regardless of the circumstances surrounding such termination.

Separation Agreements

~~Other than Mr. Swidarski,~~Historically, we ~~have not~~ entered into ~~any employment~~individually-negotiated separation agreements with our executive officers upon their separation from service in order to reinforce that individual’s confidentiality, non-competition and non-solicitation obligations. Any such separation agreements were typically heavily negotiated, but ultimately consistent with prior separation agreements. Accordingly, in 2011 the Committee approved the Severance Policy discussed above under “Personal Benefits” in order to better align with market practice, provide greater consistency in the event of an involuntary termination, and to minimize the cost of such severance negotiations.

Leslie A. Pierce: On August 6, 2012, we entered into a Separation Agreement and Release with Leslie A. Pierce, our former Vice President and Corporate Controller, who stepped down from the company effective as of April 18, 2012. Pursuant to the separation agreement, Ms. Pierce received a severance payment of $873,471 and, in addition, $26,459 in accrued vacation and $216,529 for attorneys’ fees incurred in connection with the separation agreement. Such payments are not treated as pensionable earnings. Ms. Pierce also received certain equity and other benefits consistent with our Severance Policy, and as detailed below in the “Summary Compensation Table” and “Post-Termination Payments Table.” In consideration of these payments and benefits, Ms. Pierce agreed to a general release of existing and potential claims against us and certain related parties, as well as a non-competition agreement, non-solicitation agreement and confidentiality obligations consistent with our Severance Policy.

Charles E. Ducey, Jr.: As noted in our Current Report on Form 8-K filed on January 28, 2013, Mr. Ducey stepped down from the company effective as of January 23, 2013, and his departure is considered by the company as an involuntary termination without cause. Further, as noted in our Current Report on Form 8-K filed on February 28, 2013, the company and Mr. Ducey entered into a Separation Agreement and Release on February 22, 2013. In that agreement, the company agreed that Mr. Ducey is entitled to receive the severance benefits under our Severance Policy, discussed above in “Personal Benefits,” and other benefits under applicable equity agreements. In consideration of these payments and benefits, Mr. Ducey agreed to a general release of existing and potential claims against us and certain related parties, as well as a non-competition agreement, non-solicitation agreement and confidentiality obligations consistent with our Severance Policy.

Other Compensation Policies

Clawback Policy

In addition to any other rights or remedies legally available to us, all of our equity plans include provisions that allow us to cancel awards or “claw back” any shares received pursuant to awards or the exercise of stock options for certain specified conduct that is deemed detrimental to the company. To the extent that an executive has already received value for such awards, these provisions also allow us to seek reimbursement of such value directly from the executive or through the garnishment of salary or cash bonus. Examples of such detrimental conduct include:

Engaging, directly or indirectly, in any activity in competition with us, in any product, service or business activity for which the executive had any direct responsibility or direct involvement during the two previous years.

Soliciting one of our employees to terminate his or her employment with us.

Unauthorized disclosure of confidential, proprietary or trade secret information obtained during employment with us.

Table of Contents

Failure to promptly disclose and assign any interest in any invention or idea conceived during the executive’s employment and related to any of our actual or anticipated business, research or development work.

Any activity that results in a termination for cause, including gross neglect and any act of dishonesty

constituting a felony.

In addition, the ~~other Named Executive Officers.~~

~~Change in Pension Value~~Committee has implemented a separate and ~~Non-Qualified Deferred Compensation Earnings~~

~~These benefits are discussed in more detail below under “~~~~2009 Pension Benefits~~~~;” however, the benefit values for Mr. Swidarski, Mr. Ducey and Mr. Krakora reflect their January 1, 2009 participation~~independent Clawback Policy, effective August 2, 2012, which provides an additional avenue to recover excessive performance-based incentive compensation paid during a three-year look-back period in the ~~Pension SERP~~event of willful act of misconduct resulting in an obligation on the company to prepare a financial accounting restatement due to a material noncompliance with any reporting requirement under the U.S. federal securities laws.

Insider Trading Policy

Under our Insider Trading Policy, each employee, officer and ~~Restoration SERPs based upon 13, 31~~director of the company is prohibited from buying or selling our securities when he or she is aware of material, non-public information about the company, or information about other public companies which he or she learns as our employee or director. These individuals are also prohibited from providing such information to others. In addition, this policy prohibits employees, officers and ~~eight years~~directors from engaging in short sales of ~~service, respectively. The benefit value for Ms. Pierce reflects her participation~~Diebold stock, and from buying or selling any derivative securities related to Diebold stock.

Company-Imposed Black-Out Periods

As noted above, if an executive is in possession of material non-public information, he or she is prohibited from trading in our ~~qualified pension plan based upon 19 years of service.~~

~~Pay Mix for~~stock. Apart from these trading restrictions, we also impose routine black-out periods that prohibit executives, including the Named Executive Officers, from trading during the period that begins two weeks prior to the end of each quarter and extends through the first business day following our next scheduled quarterly earnings release. These self-imposed black-out periods are an example of good corporate governance and help to protect both us and the individual from allegations of insider trading violations.

~~Based on~~However, our black-out policy was not intended to penalize employees for this type of positive corporate behavior, and in the ~~fair value of equity awards granted~~past the Committee has approved a cash distribution to employees, including Named Executive Officers, who were barred from exercising stock options prior to their expiration due to extended company-imposed black-out periods. No such exceptions were made during 2012.

Limitations on Deductibility of Compensation

Section 162(m) of the Internal Revenue Code limits the deductibility of executive compensation paid by publicly-held corporations to $1 million per certain executive officers, excluding the CFO. The $1 million limitation does not apply to compensation that qualifies as performance-based. The company considers the tax and accounting impact of all compensation. The Committee intends to maximize the use of performance-based compensation to mitigate the deduction limits. Consequently, our annual and long-term incentive plans have been designed to qualify as performance-based compensation. Solely for purposes of meeting the tax deduction requirements under Section 162(m), no bonus is paid, nor will 2012 RSU grants vest, unless 50% of budgeted non-GAAP EPS is achieved. In some situations, however, in ~~2009, as~~order to attract, retain and reward critical executive talent to maximize shareholder value, the loss of a tax deduction may be necessary and appropriate in certain circumstances.

Table of Contents

EXECUTIVE COMPENSATION

The table below summarizes the total compensation earned by each of our Named Executive Officers for the fiscal years ended December 31, ~~2009:~~2012, 2011 and 2010, as applicable. The amounts shown include compensation for services in all capacities that were provided to us.

2012 Summary Compensation Table



Name and Principal Position	Year	Salary ($)	Bonus($)	Stock Awards¹ ($)	Option Awards² ($)	Non-Equity Incentive Plan Compensation³ ($)	Change in Pension Value and Non-qualified Deferred Compensation Earnings⁴ ($)	All Other Compensation⁵ ($)	Total ($)
Thomas W. Swidarski Former President and Chief Executive Officer	2012	840,000	—	3,138,360	1,840,920	—	961,014	289,653	7,069,947
	2011	840,000	—	2,408,475	1,522,800	1,000,000	1,075,308	200,680	7,047,263
	2010	800,000	—	1,756,440	1,222,725	800,000	787,477	164,603	5,531,245
Bradley C. Richardson Executive Vice President and Chief Financial Officer	2012	520,032	—	722,895	423,200	—	—	213,022	1,879,149
	2011	499,550	—	505,665	326,700	583,275	—	227,827	2,143,017
	2010	485,000	—	404,260	239,750	615,465	—	226,242	1,970,717
Charles E. Ducey, Jr. Former Executive Vice President, North America Operations	2012	424,676	—	722,895	423,200	—	445,635	76,251	1,970,717
	2011	384,322	—	505,665	272,250	514,223	690,870	56,232	2,423,562
	2010	357,509	—	362,440	143,850	376,253	493,583	54,958	1,788,593
George S. Mayes, Jr. Executive Vice President and Chief Operating Officer (former Executive Vice President, Global Operations)	2012	360,797	—	488,880	264,500	149,093	—	175,522	1,438,792
	2011	351,997	—	406,040	217,800	446,684	—	143,679	1,566,200
	2010	343,412	—	362,440	143,850	404,368	—	120,631	1,374,701
Frank A. Natoli, Jr. Executive VIce President, Chief Innovation Officer	2012	281,328	—	468,797	174,570	117,283	—	44,245	1,086,223
	2011	—	—	—	—	—	—	—	—
	2010	—	—	—	—	—	—	—	—
Leslie A. Pierce ⁶ Former Vice President and Corporate Controller	2012	75,808	—	154,238	76,705	—	—	1,250,869	1,557,620
	2011	—	—	—	—	—	—	—
	2010	—	—	—	—	—	—	—	—


• ¹	~~Base salary accounted~~ For 2012, this column represents the aggregate grant date fair value, computed in accordance with FASB ASC Topic 718, for ~~approximately 21.3% of the total value to the Named Executive Officers;~~

•	~~Cash bonus payments for 2009~~ performance ~~made~~shares and RSUs awarded to the Named Executive Officers in ~~2010 under our Cash Bonus Plan (non-equity incentive plan compensation), accounted for approximately 18.5%~~2012. Pursuant to SEC rules, the amounts shown exclude the impact of estimated forfeitures related to service-based vesting conditions. For the performance shares, such amounts are calculated based on the probable outcome of the ~~total~~relevant performance conditions as of the grant date using a Monte Carlo simulation model. For more information regarding 2012 awards, including the assumptions used in calculating the fair value of performance shares, see the “2012 Grants of Plan-Based Awards Table” below. The maximum number of performance shares that may be earned is also reflected below under the “2012 Grants of Plan-Based Awards Table,” the grant date fair value of which would be: for Mr. Swidarski, $4,602,000; for Mr. Richardson, $1,062,000; for Mr. Ducey, $1,062,000; for Mr. Mayes, $663,750, for Mr. Natoli, $442,500, and for Ms. Pierce, $221,250. The specific terms of the performance shares and RSUs are discussed in more detail in “Compensation Discussion and Analysis.” These amounts reflect the grant date fair value for these awards, and do not necessarily correspond to the actual value that will be realized by the Named Executive Officers.

For 2012, this column represents the aggregate grant date fair value, computed in accordance with FASB ASC Topic 718, for options awarded to the Named Executive ~~Officers;~~Officers in 2012. For more information regarding 2012 grants, see the “2012 Grants of Plan-Based Awards Table” below. Pursuant to SEC rules, the amounts shown exclude the impact of estimated forfeitures related to service-based vesting conditions. The assumptions used in calculating the fair value of these stock options can be found under Note 3 to the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2012. The specific terms of the stock options are discussed in more detail above under “Compensation Discussion and Analysis.” These amounts reflect the grant date fair value for these awards, and do not necessarily correspond to the actual value that will be realized by the Named Executive Officers.


³	For 2012, this column reflects amounts earned by the Named Executive Officers under our Annual Cash Bonus Plan for the 2012 fiscal year, but that were not actually paid out until February 2013. For a more detailed description of the related performance measures for the Annual Cash Bonus Plan, see above under “Compensation Discussion and Analysis.”

•

⁴

~~Total cash compensation~~

For 2012, these amounts shown are the difference between the value of pension benefits earned as of December 31, 2012 based on a 4.21% discount rate and the RP-2000 Combined Healthy Mortality Table with mortality improvement to December 31, 2012 based on Scale AA and the value of pension benefits earned as of December 31, 2011 based on a 5.04% discount rate and the RP-2000 Combined Healthy Mortality Table with mortality improvement to December 31, 2011 based on Scale AA. Further, the values were determined assuming the probability is nil that the Named Executive Officer will terminate, retire, die or become disabled before normal retirement date. There was no above-market or preferential interest earned by any Named Executive Officer in 2012 on non-qualified deferred compensation. The benefit values for ~~2009 (base salary plus non-equity incentive plan compensation) accounted for approximately 39.8%~~Mr. Swidarski and Mr. Ducey reflect their participation in the Qualified Retirement Plan, Pension SERP and Pension Restoration SERP based upon 16 and 34 years of service, respectively, as discussed further in “2012 Pension Benefits” below. In addition, the present value of Ms. Pierce’s pension benefit decreased by a total of $72,279, which reflects a decrease of $43,818 in the Qualified Plan due to her election to receive the value as a lump sum, as discussed in “Pension Benefits” below, and a decrease of $28,461 in the Pension Restoration SERP due to the recognition of the ~~total~~actual form of payment she elected; and, in accordance with SEC rules, the negative change in pension value is shown as zero in this table.


⁵	For 2012, the amounts reported for “All Other Compensation” consist of amounts provided to the Named Executive ~~Officers;~~Officers as outlined in the table below, with respect to (a) the use of a car or cash in lieu thereof (which will be discontinued as of March 2013), (b) club memberships for Mr. Swidarski, (c) the

Table of Contents

dollar value of executive life insurance premiums paid by us for the benefit of the executive, (d) amounts contributed for the executive by us under our 401(k) plan and any non-qualified defined contribution plan, including taxes attributable to such non-qualified defined contribution plan, for which the executive is a participant, (e) financial planning services/tax assistance, (f) dividend equivalents paid on unvested RSUs, and (g) other. For all Named Executive Officers, the amount in column (g) reflects the approximate value of an annual physical exam provided to our executives, and for Messrs. Swidarski and Richardson, this column includes expenses related to the company’s sales awards recognition program. For Ms. Pierce, the amount in column (g) also reflects severance-related payments and expenses totaling $1,116,459 (severance payments, accrued vacation and attorneys fees), as well as the value of stock option awards accelerated pursuant to her separation agreement, as discussed in “Employment and Separation Agreements” above, with an aggregate intrinsic value of $123,058 (the difference between the closing market price of the company’s shares on the effective date of her separation and the exercise price, multiplied by the number of “in-the-money” options), as also reflected in the “Post-Termination Payments Table” below.



	All Other Compensation ($)
Named Executive Officer	(a)	(b)	(c)	(d)	(e)	(f)	(g)
Thomas W. Swidarski	23,400	72,280	2,346	37,976	20,000	119,130	14,521
Bradley C. Richardson	11,250	—	1,870	132,286	10,000	47,709	9,907
Charles E. Ducey, Jr.	14,256	—	2,513	20,502	10,000	25,080	3,900
George S. Mayes, Jr.	14,256	—	1,286	122,140	10,000	23,940	3,900
Frank A. Natoli, Jr.	8,193	—	—	14,425	—	17,727	3,900
Leslie A. Pierce	—	—	—	4,556	—	2,896	1,243,417


⁶	Ms. Pierce’s annual salary of $250,166 was pro-rated based on her length of employment in 2012.

2012 Grants of Plan-Based Awards Table



		Estimated Possible Payouts Under Non-Equity Incentive Plan Awards¹			Estimated Future Payouts Under Equity Incentive Plan Awards²			All Other Stock Awards: Number of Shares of Stock or Units³ (#)	All Other Option Awards: Number of Securities Underlying Options⁴ (#)	Exercise or Base Price of Option Awards ($/Sh)	Grant Date Fair Value of Stock and Option Awards⁵ ($)
Name	Grant Date	Thresh. ($)	Target ($)	Max. ($)	Thresh. (#)	Target (#)	Max. (#)			Exercise or Base Price of Option Awards ($/Sh)	Grant Date Fair Value of Stock and Option Awards⁵ ($)
Thomas W. Swidarski	2/8/2012	-	-	-	-	-	-	-	174,000	34.89	1,840,920
	2/8/2012	-	-	-	-	-	-	24,000	-	-	837,360
	2/8/2012	-	-	-	13,000	52,000	104,000	-	-	-	2,301,000
	2/8/2012	336,000	840,000	1,680,000	-	-	-	-	-	-	-
Bradley C. Richardson	2/8/2012	-	-	-	-	-	-	-	40,000	34.89	423,200
	2/8/2012	-	-	-	-	-	-	5,500	-	-	191,895
	2/8/2012	-	-	-	3,000	12,000	24,000	-	-	-	531,000
	2/8/2012	156,010	390,024	780,048	-	-	-	-	-	-	-
Charles E. Ducey, Jr.	2/8/2012	-	-	-	-	-	-	-	40,000	34.89	423,200
	2/8/2012	-	-	-	-	-	-	5,500	-	-	191,895
	2/8/2012	-	-	-	3,000	12,000	24,000	-	-	-	531,000
	2/8/2012	127,403	318,507	637,014	-	-	-	-	-	-	-
George S. Mayes, Jr.	2/8/2012	-	-	-	-	-	-	-	25,000	34.89	264,500
	2/8/2012	-	-	-	-	-	-	4,500	-	-	157,005
	2/8/2012	-	-	-	1,875	7,500	15,000	-	-	-	331,875
	2/8/2012	108,239	270,598	541,196	-	-	-	-	-	-	-
Frank A. Natoli, Jr.	2/8/2012	-	-	-	-	-	-	-	16,500	34.89	174,570
	2/8/2012	-	-	-	-	-	-	2,300	-	-	80,247
	2/8/2012	-	-	-	1,250	5,000	10,000	-	-	-	221,250
	2/8/2012	56,266	140,664	281,328	-	-	-	-	-	-	-
	8/13/2012	-	-	-	-	-	-	5,000	-	-	167,300
Leslie A. Pierce⁶	2/8/2012	-	-	-	-	-	-	-	7,250	34.89	76,705
	2/8/2012	-	-	-	-	-	-	1,250	-	-	43,613
	2/8/2012	-	-	-	625	2,500	5,000	-	-	-	110,625
	2/8/2012	50,033	125,083	250,166	-	-	-	-	-	-	-

•

~~Short- and long-term performance-based compensation (non-equity incentive plan compensation plus stock and option awards) accounted~~

These columns present information about the potential payout under our Annual Cash Bonus Plan for ~~approximately 61.1%~~fiscal year 2012. The actual amount paid in February 2013 is reflected above in the “2012 Summary Compensation Table” under the column “Non-Equity Incentive Plan Compensation.” For a more detailed description of the ~~total compensation~~related performance measures for our Annual Cash Bonus Plan, see above under “Compensation Discussion and Analysis.”

These columns present information about performance shares awarded during 2012 pursuant to the ~~Named Executive Officers.~~1991 Plan. The performance measures will be calculated over the three-year period beginning on January 1, 2012 and ending on December 31, 2014. No amount is payable unless the threshold performance is exceeded. The maximum award amount, which can be up to 200% of the target amount, will be earned only if we achieve maximum performance. For a more detailed description of the performance shares and the related performance measures, see above under “Compensation Discussion and Analysis.”


³	This column presents information about RSUs awarded during 2012 pursuant to the 1991 Plan. For a more detailed description of the RSUs, see above under “Compensation Discussion and Analysis.”

Table of Contents


⁴	All stock option grants were new and not granted in connection with an option re-pricing transaction, and the terms of the stock options were not materially modified in 2012. For a more detailed description of the stock options, see above under “Compensation Discussion and Analysis.”

⁵

For performance shares, the fair value of $44.25 per share as of the grant date was calculated using a Monte Carlo simulation model, and such values reflect the total amount that we would expect to expense in our financial statements over the awards’ three-year performance period, based on the probable outcome of the performance conditions, excluding the effect of estimated forfeitures, in accordance with FASB ASC Topic 718. The assumptions used in calculating the fair value of these performance shares were as follows: (a) an expected performance period of three years; (b) a risk-free interest rate of 0.4%, which is the interest rate for a zero-coupon U.S. government bond, with a maturity of three years; (c) volatility of 32.9%, calculated using the daily ending stock price for the equivalent period to the expected term prior to grant date; and (d) a dividend yield of 3.27% as of the grant date. For RSUs, the fair value is calculated using the closing market price of the shares on the February 8, 2012 grant date of $34.89, and $33.46 for Mr. Natoli’s August 13, 2012 grant, and such values reflect the total amount that we would expect to expense in our financial statements over the awards’ three-year vesting period. For stock options, the fair value was calculated using the Black-Scholes value on the grant date of $10.58, calculated in accordance with FASB ASC Topic 718. The assumptions used in calculating the fair value of these stock options can be found under Note 3 to the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2012.


⁶	Awards for Ms. Pierce have not been pro-rated in this table to reflect the length of her employment in 2012.

In 2012, we were party to an employment agreement with Mr. Swidarski, and we entered into a Separation Agreement and Release with Ms. Pierce. For more information about these agreements, see “Employment and Separation Agreements” above under “Compensation Discussion and Analysis.”

Outstanding Equity Awards at ~~2009~~2012 Fiscal Year-End

The following table provides information relating to exercisable and unexercisable stock options as of December 31, ~~2009~~2012 for the Named Executive Officers. In addition, the following table provides information relating to grants of ~~restricted shares,~~ RSUs and performance shares to the Named Executive Officers that have not yet vested as of December 31, ~~2009.~~2012. No stock appreciation rights were outstanding as of December 31, ~~2009.~~2012.

Option Awards¹ Stock Awards
Equity Incentive
Market

Plan Awards:
Number
Value of

Number of Securities
Number of
of Shares
Shares or
Equity Incentive Plan Awards:
Underlying Unexercised
Securities
or Units
Units of
Number of
Market or Payout

Options Underlying
of Stock
Stock
Unearned Shares,
Value of Unearned

Unexercised
Option
That
That
Units or Other
Shares, Units or

Unearned
Exercise
Option
Have Not
Have Not
Rights That Have
Other Rights That

Grant Date
Exercisable
Unexercisable
Options
Price
Expiration
Vested² Vested³ Not Vested⁴ Have Not Vested³
Name
of Award (#) (#) (#) ($) Date (#) ($) (#) ($)

Thomas W. Swidarski
2/7/01 8,000 - - 28.69 2/6/11 - - - -
2/6/02 15,000 - - 36.59 2/5/12 - - - -
2/5/03 20,000 - - 36.31 2/4/13 - - - -
2/11/04 25,000 - - 53.10 2/10/14 - - - -
2/10/05 22,900 - - 55.23 2/9/15 - - - -
12/12/05 75,000 75,000 - 37.87 12/11/12 - - - -
2/13/08 30,000 90,000 - 25.53 2/12/18 - - - -
2/11/09 - 150,000 - 24.79 2/10/19 - - - -
2/14/07 - - - - - 40,000 1,138,000 - -
2/14/07 - - - - - - - 20,000 569,000
2/13/08 - - - - - - - 60,000 1,707,000
3/26/09 - - - - - - - 50,000 1,422,500
Bradley C. Richardson
11/23/09 - 30,000 - 26.43 11/22/19 - - - -
11/23/09 - - - - - 23,850 678,533 - -
11/23/09 - - - - - - - 5,625 160,031
James L.M. Chen
2/6/02 5,000 - - 36.59 2/5/12 - - - -
2/5/03 7,500 - - 36.31 2/4/13 - - - -
2/11/04 8,000 - - 53.10 2/10/14 - - - -
2/10/05 8,000 - - 55.23 2/9/15 - - - -
2/20/06 6,000 2,000 - 39.43 2/19/16 - - - -
2/14/07 4,750 4,750 - 47.27 2/13/17 - - - -
2/13/08 2,500 7,500 - 25.53 2/12/18 - - - -
2/11/09 - 15,000 - 24.79 2/10/19 - - - -
2/20/06 - - - - - 750 21,338 - -
2/13/08 - - - - - 7,500 213,375 - -
2/14/07 - - - - - - - 5,000 142,250
2/13/08 - - - - - - - 12,000 341,400
3/26/09 - - - - - - - 7,500 213,375
George S. Mayes Jr.
2/10/05 3,000 - - 55.23 2/9/15 - - - -
2/20/06 6,000 2,000 - 39.43 2/19/16 - - - -
2/14/07 4,750 4,750 - 47.27 2/13/17 - - - -
2/13/08 2,500 7,500 - 25.53 2/12/18 - - - -
2/11/09 - 15,000 - 24.79 2/10/19 - - - -
2/20/06 - - - - - 4,500 128,025 - -
2/14/07 - - - - - - - 5,000 142,250
2/13/08 - - - - - - - 12,000 341,400
3/26/09 - - - - - - - 7,500 213,375
Charles E. Ducey Jr.
2/7/01 5,000 - - 28.69 2/6/11 - - - -
2/6/02 6,400 - - 36.59 2/5/12 - - - -
2/5/03 8,000 - - 36.31 2/4/13 - - - -
2/11/04 5,000 - - 53.10 2/10/14 - - - -
2/10/05 4,600 - - 55.23 2/9/15 - - - -
2/20/06 7,500 2,500 - 39.43 2/19/16 - - - -
2/14/07 4,750 4,750 - 47.27 2/13/17 - - - -
2/13/08 2,500 7,500 - 25.53 2/12/18 - - - -
2/11/09 - 15,000 24.79 2/10/19 - - - -
2/20/06 - - - - - 4,500 128,025 - -
2/14/07 - - - - - - - 5,000 142,250
2/13/08 - - - - - - - 12,000 341,400
3/26/09 - - - - - - - 7,500 213,375
Leslie A. Pierce
2/7/01 600 - - 28.69 2/6/11 - - - -
2/6/02 600 - - 36.59 2/5/12 - - - -
2/5/03 600 - - 36.31 2/4/13 - - - -
2/14/07 625 625 - 47.27 2/13/17 - - - -
2/13/08 1,250 3,750 - 25.53 2/12/18 - - - -
2/11/09 - 7,000 - 24.79 2/10/19 - - - -
2/14/07 - - - - - 285 8,108 - -
2/13/08 - - - - - - - 7,000 199,150
3/26/09 - - - - - - - 3,500 99,575
Kevin J. Krakora
9/18/01 5,000 - - 35.60 9/17/11 - - - -
2/6/02 10,000 - - 36.59 2/5/12 - - - -
2/5/03 10,000 - - 36.31 2/4/13 - - - -
2/11/04 7,000 - - 53.10 2/10/14 - - - -
2/10/05 6,500 - - 55.23 2/9/15 - - - -
2/20/06 18,750 6,250 - 39.43 2/19/16 - - - -
2/14/07 12,500 12,500 - 47.27 2/13/17 - - - -
2/13/08 5,000 15,000 - 25.53 2/12/18 - - - -
2/11/09 - 25,000 24.79 2/10/19 - - - -
2/20/06 - - - - - 7,500 213,375 - -
2/14/07 - - - - - - - 10,000 284,500
2/13/08 - - - - - - - 20,000 569,000
3/26/09 - - - - - - - 12,500 355,625



		Option Awards¹					Stock Awards
		Number of Securities Underlying Unexercised Options		Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)
		Number of Securities Underlying Unexercised Options							Equity Incentive Plan Awards:
Name	Grant Date of Award	Exercisable (#)	Unexercisable (#)		Option Exercise Price ($)	Option Expiration Date	Number of Shares or Units of Stock That Have Not Vested² (#)	Market Value of Shares or Units of Stock That Have Not Vested³ ($)	Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)	Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested⁴ ($)
Thomas W. Swidarski	2/11/2004	25,000	—	—	53.10	2/10/2014	—	—	—	—
	2/10/2005	22,900	—	—	55.23	2/9/2015	—	—	—	—
	2/13/2008	19,757	—	—	25.53	2/12/2018	—	—	—	—
	2/11/2009	112,500	37,500	—	24.79	2/10/2019	—	—	—	—
	2/11/2010	63,750	63,750	—	27.88	2/10/2020	—	—	—	—
	2/14/2011	33,750	101,250	—	33.75	2/13/2021	—	—	—	—
	2/8/2012	—	174,000	—	34.89	2/7/2022	—	—	—	—
	2/14/2007	—	—	—	—	—	40,000	1,224,400	—	—
	2/11/2010	—	—	—	—	—	20,500	627,505	—	—
	2/14/2011	—	—	—	—	—	20,000	612,200	—	—
	2/8/2012	—	—	—	—	—	24,000	734,640	—	—
	2/11/2010	—	—	—	—	—	—	—	42,500	1,300,925
	2/14/2011	—	—	—	—	—	—	—	43,500	1,331,535
	2/8/2012	—	—	—	—	—	—	—	52,000	397,930
Bradley C. Richardson	11/23/2009	22,500	7,500	—	26.43	11/22/2019	—	—	—	—
	2/11/2010	12,500	12,500	—	27.88	2/10/2020	—	—	—	—
	2/10/2011	7,500	22,500	—	32.67	2/9/2021	—	—	—	—
	2/8/2012	—	40,000	—	34.89	2/7/2022	—	—	—	—
	2/11/2010	—	—	—	—	—	8,000	244,880	—	—
	2/10/2011	—	—	—	—	—	4,500	137,745	—	—
	2/8/2012	—	—	—	—	—	5,500	168,355	—	—
	2/11/2010	—	—	—	—	—	—	—	6,500	198,965
	2/10/2011	—	—	—	—	—	—	—	9,000	275,490
	2/8/2012	—	—	—	—	—	—	—	12,000	91,830
Charles E. Ducey, Jr.⁵	2/11/2004	5,000	—	—	53.10	2/10/2014	—	—	—	—
	2/10/2005	4,600	—	—	55.23	2/9/2015	—	—	—	—
	2/20/2006	10,000	—	—	39.43	2/19/2016	—	—	—	—
	2/14/2007	9,500	—	—	47.27	2/13/2017	—	—	—	—
	2/11/2009	—	3,750	—	24.79	2/10/2019	—	—	—	—
	2/11/2010	7,500	7,500	—	27.88	2/10/2020	—	—	—	—
	2/10/2011	6,250	18,750	—	32.67	2/9/2021	—	—	—	—
	2/8/2012	—	40,000	—	34.89	2/7/2022	—	—	—	—

Table of Contents



Name		Option Awards¹					Stock Awards
		Number of Securities Underlying Unexercised Options		Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)
		Number of Securities Underlying Unexercised Options							Equity Incentive Plan Awards:
	Grant Date of Award	Exercisable (#)	Unexercisable (#)		Option Exercise Price ($)	Option Expiration Date	Number of Shares or Units of Stock That Have Not Vested² (#)	Market Value of Shares or Units of Stock That Have Not Vested³ ($)	Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)	Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested⁴ ($)
Charles E. Ducey, Jr.⁵	2/20/2006	—	—	—	—	—	4,500	137,745	—	—
(continued)	2/11/2010	—	—	—	—	—	7,500	229,575	—	—
	2/10/2011	—	—	—	—	—	4,500	137,745	—	—
	2/8/2012	—	—	—	—	—	5,500	168,355	—	—
	2/11/2010	—	—	—	—	—	—	—	5,500	168,355
	2/10/2011	—	—	—	—	—	—	—	9,000	275,490
	2/8/2012	—	—	—	—	—	—	—	12,000	91,830
George S. Mayes, Jr.	2/10/2005	3,000	—	—	55.23	2/9/2015	—	—	—	—
	2/20/2006	8,000	—	—	39.43	2/19/2016	—	—	—	—
	2/14/2007	9,500	—	—	47.27	2/13/2017	—	—	—	—
	2/11/2009	—	3,750	—	24.79	2/10/2019	—	—	—	—
	2/11/2010	—	7,500	—	27.88	2/10/2020	—	—	—	—
	2/10/2011	5,000	15,000	—	32.67	2/9/2021	—	—	—	—
	2/8/2012	—	25,000	—	34.89	2/7/2022	—	—	—	—
	2/20/2006	—	—	—	—	—	4,500	137,745	—	—
	2/11/2010	—	—	—	—	—	7,500	229,575	—	—
	2/10/2011	—	—	—	—	—	4,500	137,745	—	—
	2/8/2012	—	—	—	—	—	4,500	137,745	—	—
	2/11/2010	—	—	—	—	—	—	—	5,500	168,355
	2/10/2011	—	—	—	—	—	—	—	6,500	198,965
	2/8/2012	—	—	—	—	—	—	—	7,500	57,394
Frank A. Natoli, Jr.	2/14/2007	700	—	—	47.27	2/13/2017	—	—	—	—
	2/11/2009	—	750	—	24.79	2/10/2019	—	—	—	—
	2/11/2010	—	2,500	—	27.88	2/10/2020	—	—	—	—
	2/10/2011	—	6,375	—	32.67	2/9/2021	—	—	—	—
	2/8/2012	—	16,500	—	34.89	2/7/2022	—	—	—	—
	2/11/2010	—	—	—	—	—	4,750	145,398	—	—
	2/10/2011	—	—	—	—	—	6,000	183,660	—	—
	2/8/2012	—	—	—	—	—	2,300	70,403	—	—
	8/13/2012	—	—	—	—	—	5,000	153,050	—	—
	2/11/2010	—	—	—	—	—	—	—	2,000	61,220
	2/10/2011	—	—	—	—	—	—	—	2,750	84,178
	2/8/2012	—	—	—	—	—	—	—	5,000	38,263
Leslie A. Pierce⁶	2/11/2010	—	—	—	—	—	—	—	2,139	65,475
	2/10/2011	—	—	—	—	—	—	—	1,111	34,008
	2/8/2012	—	—	—	—	—	—	—	278	2,127


¹		~~With the exception of Mr. Swidarski’s December 12, 2005 award of 150,000 stock options, all of the~~All stock options outstanding at ~~2009~~the 2012 fiscal year-end vest ratably over a four-year period beginning on the first anniversary of the date of grant. ~~Mr. Swidarski’s award of 150,000 stock options has a seven-year cliff vest; however, pursuant to the terms of the option grants, one-half of this award vested on August 7, 2007, when~~


		~~our stock price reached $50 per share for 20 consecutive trading days. The remainder of this award may vest early if our stock price reaches $60 per share for 20 consecutive trading days.~~

²		This column reflects unvested RSUs ~~and restricted shares~~ granted to the Named Executive Officers that had not yet vested as of December 31, ~~2009.~~2012. Included in this column are special grants of RSUs awarded to Messrs. ~~Chen, Mayes,~~ Ducey, and ~~Krakora~~Mayes on February 20, 2006 of ~~1,500 RSUs,~~ 9,000 RSUs ~~9,000 RSUs, and 15,000 RSUs, respectively,~~each, with a seven-year cliff vest; however, pursuant to the terms of the RSU grants, one-half of these awards vested on August 7, 2007, when our stock price reached $50 per share for 20 consecutive trading days. The remainder of these special grants may vest early if our stock price reaches $60 per share for 20 consecutive trading days. Also included in this column is a special grant of RSUs awarded to Mr. Swidarski on February 14, 2007 of 40,000 RSUs with a seven-year cliff vest; however, pursuant to the terms of the RSU grant, one-half of this award may vest early if our stock price reaches $62 per share for 20 consecutive trading days and the remainder may vest early if our stock price reaches $75 per share for 20 consecutive trading days. The remaining RSUs ~~and restricted shares~~ included in this column have a three-year cliff vest.


³		The market value was calculated using the closing price of ~~the~~our common shares of ~~$28.45~~$30.61 as of December 31, ~~2009.~~2012.



⁴		This column reflects the probable outcome, as of December 31, ~~2009,~~2012, of performance shares granted to the Named Executive Officer for the performance periods ~~2007~~2010 to ~~2009, 2008~~2012, 2011 to ~~2010,~~2013 and ~~2009~~2012 to ~~2011.~~2014. For the ~~2007~~2010 to ~~2009~~2012 and 2011 to 2013 performance ~~period,~~periods, the current performance as of December 31, ~~2009,~~2012 was between threshold and target, and, as such, pursuant to SEC rules, this column reflects the target ~~payout.~~payout for these periods. For the ~~2008~~2012 to ~~2010~~2014 performance period, the current performance as of December 31, ~~2009, was between target and maximum~~2012 is below threshold, and, as such, pursuant to SEC rules, this column reflects the ~~maximum payout. For the 2009 to 2011 performance period, the current performance,~~threshold payout for that period.


⁵	As noted above, Mr. Ducey stepped down as our Executive Vice President, North America Operations effective as of ~~December 31, 2009, was between threshold~~January 23, 2013. For further information on the treatment of Mr. Ducey’s outstanding equity awards as a result of his departure, see “Employment and ~~target~~Separation Agreements” above.


⁶	The amount of performance shares shown for Ms. Pierce is pro-rated to reflect her period of employment for 2012. For further discussion, see “Employment and ~~as such, pursuant to SEC rules, this column reflects the target payout.~~Separation Agreements” and “2012 Pay Elements” above.

Table of Contents

~~2009~~2012 Option Exercises and Stock Vested

Option Awards Stock Awards
Number of Shares
Value
Number of Shares
Value

Acquired on
Realized on
Acquired
Realized on

Exercise
Exercise¹ on Vesting
Vesting²
Name (#) ($) (#) ($)
Thomas W. Swidarski
1,500 $ 6,675 12,597 $ 312,280
Bradley C. Richardson
0 0 0 0
James L.M. Chen
0 0 4,845 120,108
George S. Mayes Jr.
0 0 3,309 82,030
Charles E. Ducey Jr.
1,300 9,521 3,081 76,378
Leslie A. Pierce
0 0 302 10,716
Kevin J. Krakora
0 0 6,276 155,582



	Option Awards		Stock Awards
Name	Number of Shares Acquired on Exercise (#)	Value Realized on Exercise¹ ($)	Number of Shares Acquired on Vesting (#)	Value Realized on Vesting² ($)
Thomas W. Swidarski	170,243	1,263,459	35,000	1,357,300
Bradley C. Richardson	—	—	27,788	859,868
Charles E. Ducey, Jr.	29,250	278,010	5,250	203,595
George S. Mayes, Jr.	28,750	350,363	5,250	203,595
Frank A. Natoli, Jr.	8,125	105,162	1,050	40,719
Leslie A. Pierce	35,100	276,522	4,656	179,788


¹		The value realized is calculated by multiplying the number of stock options by the difference between the market value of the underlying securities on the date of exercise and the exercise price of the stock option. In 2009, Mr. Swidarski exercised 1,500 stock options on November 6, 2009, with a closing price of our Common Shares on that date of $27.33 and an exercise price of $22.88; Mr. Ducey exercised 1,300 stock options on August 13, 2009, with a market value of our Common Shares at the time of exercise of $30.20 and an exercise price of $22.88.



²		The value realized is calculated for RSUs ~~restricted shares~~ and performance shares by multiplying the number of shares of stock or units, as applicable, by the market value of the underlying securities on the vesting date. In 2009, Ms. Pierce received RSUs that vested on February 19, 2009, with a closing price of our Common Shares on that date of $24.08, and Mr. Swidarski, Mr. Chen, Mr. Mayes, Mr. Ducey and Mr. Krakora received a payout of performance shares on February 11, 2009, for the 2006 — 2008 performance period, with a closing price of our Common Shares on that date of $24.79. The number of shares actually received upon vesting may be less than the number shown, due to shares being withheld for the payment of applicable taxes.

2012 Pension and Retirement Benefits

~~2009 Pension Benefits~~

Number of Years of
Present Value of
Payment During

Credited Service
Accumulated Benefit¹ Last Fiscal Year

Name Plan Name (#) ($) ($)
Thomas W. Swidarski
Qualified Plan 13.3333 $ 166,000 -
Pension SERP 13.3333 635,000 -
Pension Restoration SERP 13.3333 621,000 -
Charles E. Ducey Jr.
Qualified Plan 31.1667 395,000 -
Pension SERP 31.1667 309,000 -
Pension Restoration SERP 31.1667 364,000 -
Leslie A. Pierce
Qualified Plan 19.0000 119,000 -
Kevin J. Krakora
Qualified Plan 8.2500 109,000 -
Pension SERP 8.2500 356,000 -
Pension Restoration SERP 8.2500 154,000 -



Name	Plan Name	Number of Years of Credited Service (#)	Present Value of Accumulated Benefit¹ ($)	Payment During Last Fiscal Year ($)
Thomas W. Swidarski	Qualified Retirement Plan	16.3333	$382,884	-
	Pension SERP	16.3333	$1,493,575	-
	Pension Restoration SERP	16.3333	$2,375,731	-
Bradley C. Richardson	-	-	-	-
Charles E. Ducey, Jr.	Qualified Retirement Plan	34.1667	$720,484	-
	Pension SERP	34.1667	$499,344	-
	Pension Restoration SERP	34.1667	$1,478,260	-
George S. Mayes, Jr.	-	-	-	-
Frank A. Natoli, Jr.	-	-	-	-
Leslie A. Pierce²	Qualified Retirement Plan	21.3333	$241,787	$241,787
	Pension Restoration SERP	21.3333	$143,827	-


¹		The values are determined based on a ~~6.33%~~4.21% discount rate and the RP-2000 Combined Healthy Mortality Table with projected mortality improvement to December 31, ~~2009~~2012 based on Scale AA and are calculated assuming that the probability is nil that a Named Executive Officer terminates, dies, retires or becomes disabled before normal retirement date.


²	Ms. Pierce was paid a lump sum equal to the value of her Qualified Retirement Plan Benefit in December 2012, as part of a one-time window for eligible terminated vested participants to elect a lump sum, as discussed in “Qualified Retirement Plan” below.

~~All Named Executive Officers (except Mr. Richardson, Mr. Chen~~Messrs. Swidarski and ~~Mr. Mayes)~~Ducey, and Ms. Pierce while an employee during 2012, participate in the Diebold, Incorporated Retirement Plan for Salaried Employees, or Qualified Retirement Plan, which provides funded, tax-qualified benefits under the Internal Revenue Code to all salaried and non-union hourly U.S.-based employees ~~of the Company~~ who were hired before July 1, 2003. This plan provides benefits that are limited by Internal Revenue Code requirements applicable to all tax-qualified pension plans. We also maintain three defined benefit Supplemental Executive Retirement Plans, or SERPs, which provide unfunded, non-qualified benefits to select executives. The purpose of the SERPs is to provide additional benefits above those provided under the Qualified Retirement Plan. ~~Mr.~~Messrs. Swidarski ~~Mr.~~and Ducey ~~and Mr. Krakora~~also participate in the Pension Restoration SERP and the Pension SERP. Ms. Pierce participates in the Pension Restoration SERP.

Qualified Retirement Plan

The benefit provided under the Qualified Retirement Plan is payable as a life annuity beginning at normal retirement age (age 65). The benefit is determined based on the following formula:

0.8% of final average compensation up to the Covered Compensation level; plus


•	~~0.8% of final average compensation up to the Covered Compensation level, plus~~

•	~~1.25% of final average compensation in excess of the Covered Compensation level,~~

•	~~which sum is multiplied by years of service (subject to a maximum of 30 years).~~

1.25% of final average compensation in excess of the Covered Compensation level;

which sum is multiplied by years of service (subject to a maximum of 30 years).

Table of Contents

In addition, a benefit equal to $50.40 times the number of years of service (subject to a maximum of 30 years) is added to the amount determined above.

Final average compensation is an average of the five highest consecutive full calendar years of salary and bonus out of the last ten full calendar years, with each year’s compensation held to a maximum of the IRS compensation limit for that year ($~~245,000~~ 250,000in ~~2009)~~2012). The participant’s individual “Covered Compensation” is as defined under the Internal Revenue Code. The benefit is payable for the lifetime of the participant, with alternative forms of payment available to the participant with an actuarial reduction.

Participants may retire early if they are at least age 50 and the sum of their age plus service is at least 70, or at any age with 30 years of service. Benefits may begin upon retirement on an actuarially reduced basis. Participants with at least 15 years of service who become disabled while employed are eligible for an immediate unreduced benefit. Participants terminating with at least five years of service are entitled to a deferred vested benefit at age 65, or may commence the benefit on an actuarially reduced basis, ~~when~~if they are at least age 50 and the sum of their age plus service is at least 70.

The company amended the Qualified Retirement Plan during 2012 to allow terminated vested participants a one-time option to receive their pension benefits as a lump sum. Mr. Pierce was the only Named Executive Officer eligible for this option. She elected to receive a lump sum of her Qualified Retirement Plan benefit, which was distributed to her in December, 2012.

Mr. Swidarski has additional annual benefits payable from the Qualified Retirement Plan in the amount of $4,668, ~~also~~ as a result of a transfer of a portion of his Pension SERP benefits. This amount is payable at the same time ~~and in~~as the ~~same form as those~~Pension SERP described below ~~under the Pension SERP.~~as a 100% joint and survivor annuity benefit.

Pension Restoration SERP

Benefits under the Pension Restoration SERP are determined using the same formula as stated above for the Qualified Retirement Plan except the IRS compensation limit is ignored. Net benefits payable from the Pension Restoration SERP at age 65 equal the difference between the benefit determined using total pensionable pay, ignoring qualified plan compensation limits, and the benefit payable from the Qualified Retirement Plan. All other provisions of the Pension Restoration SERP are identical to the Qualified Retirement ~~Plan. Mr.~~Plan with the exception of the actuarial reduction factors for retirement before age 65. Messrs. Swidarski ~~Mr.~~and Ducey, and ~~Mr. Krakora~~Ms. Pierce, are the only Named Executive Officers who ~~are~~were participants in the Pension Restoration ~~SERP.~~SERP in 2012.

Pension SERP

The Pension SERP provides a supplemental monthly retirement benefit in an amount such that a participant’s total retirement benefit from the Qualified Retirement Plan, the Pension Restoration SERP, the annuity equivalent of the projected employer-provided balance in the 401(k) Restoration SERP (assuming a 3% employer match and a fixed rate of return of 8%) and the Pension SERP, plus one-half of the participant’s anticipated Social Security benefit payable at age 65, equals 50% ~~(prorated~~(pro-rated for less than 25 years of service) of the participant’s final average compensation received from us during the highest five consecutive full calendar years of the last ten full calendar years of employment. Compensation is defined for this purpose as salary plus bonus accrued for each such calendar year. The Pension SERP benefits are payable at age 65 as a straight life annuity. Joint and survivor options are available on an actuarially equivalent basis. Benefits are available to participants retiring or terminating employment with at least 10 years of service, and are payable at the later ~~of: (i)~~of (1) attaining both the age of 50 and 70 points (determined by age plus years of service), or ~~(ii)~~(2) separation from service (on a reduced basis if payments begin before age 65). Participants who become disabled while employed and have at least 15 years of service are eligible for an immediate benefit.

Accrued benefits under the Pension SERP are fully vested in the event of a ~~change in control~~change-in-control of the company. ~~Mr.~~Messrs. Swidarski ~~Mr.~~and Ducey ~~and Mr. Krakora~~ are the only Named Executive Officers who ~~are~~were participants in the Pension ~~SERP.~~

SERP in 2012. Mr. Swidarski ~~and Mr. Krakora receive~~receives enhanced benefits such that ~~they accrue~~he accrues the full 50% target ratably over ~~their~~his entire service at age ~~60 and age 62, respectively.~~60.

Present Value of Accumulated Benefits

The “Present Value of Accumulated ~~Benefit”~~Benefits” is the single-sum value as of December 31, ~~2009,~~2012, of the annual pension benefit that was earned through that date payable under a plan beginning at the Named Executive Officer’s normal retirement age. The normal retirement age is defined as age 65 for the Qualified Retirement Plan, Pension Restoration SERP and Pension SERP. AFor Mr. Swidarski, a portion of the Qualified Retirement Plan benefit is payable at the same time and in the same form of payment as benefits in the Pension ~~SERP.~~SERP (as a 100% joint and survivor benefit). We used certain assumptions to determine the single-sum value of the annual benefit that is payable beginning at normal retirement age. The key assumptions are as follows:

An interest rate of 4.21%, the FASB ASC 715 discount rate as of December 31, 2012;


•	~~An interest rate of 6.33%, the FASB ASC 715 discount rate as of December 31, 2009;~~

•	~~The RP-2000 Combined Healthy Mortality Tables for males and females projected with mortality improvement to December 31, 2009 using Scale AA;~~

•	~~A probability of 100% that benefits are paid as annuities; and~~

•	~~No probability of termination, retirement, death, or disability before normal retirement age.~~

Table of Contents

The RP-2000 Combined Healthy Mortality Tables for males and females projected with mortality improvement to December 31, 2012 using Scale AA;
A probability of 100% that benefits are paid as annuities; and
No probability of termination, retirement, death, or disability before normal retirement age.

Extra Credited Service

Mr. Swidarski ~~and Mr. Krakora have~~has been granted the ability to accrue, for benefit calculation purposes only, 1.124 ~~and 1.546~~ years of service ~~respectively,~~ for each year of service until the full 50% target benefit in the Pension SERP is accrued at age ~~60 and age 62, respectively.~~60. We reserve the discretion to provide such grants of extra service on acase-by-case basis. Factors that might warrant such a grant would include, but not be limited by, the following: the recruitment of an executive who is foregoing benefits under a prior employer’s SERP or other non-qualified deferred compensation plans, or the provision for an executive who would otherwise not qualify for a full accrual at the SERP’s normal retirement age of 65 because his or her years of service are less than the required 25 years of service.

~~2009~~2012 Non-Qualified Deferred Compensation

1992 Deferred Compensation Plan

Executive
Registrant
Aggregate
Aggregate Balance

Contributions in
Contributions in
Aggregate Earnings
Withdrawals/
as of December 31,

2009
2009
in 2009¹ Distributions
2009²
Name ($) ($) ($) ($) ($)
Thomas W. Swidarski
— — — — —
Bradley C. Richardson
— — — — —
James L.M. Chen
— — — — —
George S. Mayes Jr.
— — — — —
Charles E. Ducey Jr.
0 0 1,863 0 36,969
Leslie A. Pierce
— — — — —
Kevin J. Krakora
— — — — —



Deferred Incentive Compensation Plan No. 2
Name	Executive Contributions in 2012 ($)	Registrant Contributions in 2012 ($)	Aggregate Earnings in 2012¹($)	Aggregate Withdrawals/ Distributions ($)	Aggregate Balance as of December 31, 2012² ($)
Thomas W. Swidarski	—	—	—	—	—
Bradley C. Richardson	—	—	37,188	—	700,735
Charles E. Ducey, Jr.	—	1,345	1,065	—	45,691
George S. Mayes, Jr.	—	—	—	—	—
Frank A. Natoli, Jr.	—	—	—	—	—
Leslie A. Pierce	—	—	—	—	—


¹		This amount represents aggregate earnings (or losses) on cash deferrals, as well as dividends on deferred ~~Common Shares.~~common shares. This amount is not reflected above in the “~~2009~~2012 Summary Compensation Table,” as it is not considered preferential or above-market earnings on deferred compensation.



²		This column reflects the balance of all cash deferrals, including dividends on deferred ~~Common Shares,~~common shares, and the aggregate earnings (or losses) in ~~2009~~2012 on such cash deferrals. As of December 31, ~~2009,~~2012, the aggregate balance of all cash deferrals for Mr. ~~Ducey~~Richardson was ~~$3,398.~~$700,735 and $9,571 for Mr. Ducey. This column also reflects the value of ~~Common Shares~~common shares deferred by Mr. Ducey calculated using the closing price of the common shares of ~~$28.45~~$30.61 as of December 31, ~~2009.~~2012. The aggregate number of ~~Common Shares~~common shares deferred by Mr. Ducey and reflected in this column was 1,180 shares, with a value as of December 31, ~~2009,~~2012, of ~~$33,571.~~$36,120. No portion of ~~this amount is~~these amounts are reflected in the “All Other Compensation” column of the “~~2009~~2012 Summary Compensation Table” and no portion of ~~this amount was~~these amounts were previously reported in our Summary Compensation Tables in prior years’ proxy statements.

401(k) Restoration SERP and 401(k) SERP

Executive
Registrant
Aggregate
Aggregate Balance

Contributions in
Contributions in
Aggregate Earnings
Withdrawals/
as of December 31,

2009¹ 2009² in 2009³ Distributions
2009⁴
Participants’ Name ($) ($) ($) ($) ($)
Thomas W. Swidarski
120,300 0 66,194 0 301,608
Bradley C. Richardson
0 14,145 0 0 14,145
James L.M. Chen
— — — — —
George S. Mayes Jr.
31,738 144,622⁵ 54,754 0 291,291
Charles E. Ducey Jr.
29,788 0 23,465 0 75,678
Leslie A. Pierce
— — — — —
Kevin J. Krakora
0 0 5,152 0 22,114



401(k) Restoration SERP and 401(k) SERP
Name	Executive Contributions in 2012¹ ($)	Registrant Contributions in 2012² ($)	Aggregate Earnings in 2012³ ($)	Aggregate Withdrawals/ Distributions ($)	Aggregate Balance as of December 31, 2012⁴ ($)
Thomas W. Swidarski	102,000	30,600	65,336	—	593,588
Bradley C. Richardson	92,991	88,600	23,800	—	490,507
Charles E. Ducey, Jr.	72,656	15,626	21,268	—	233,545
George S. Mayes, Jr.	44,841	90,641	62,767	—	712,118
Frank A. Natoli, Jr.	32,305	14,354	4,004	—	63,985
Leslie A. Pierce	110,351	4,513	7,771	—	144,867


¹		These amounts are included in the “Salary” column of the “~~2009~~2012 Summary Compensation Table.” For Ms. Pierce, this number also includes contributions she made from a cash bonus award she received in February 2012 based on 2011 performance, which is not included in the “2012 Summary Compensation Table.”



²		These amounts are included in the “All Other Compensation” column of the “~~2009~~2012 Summary Compensation Table” and include amounts contributed in ~~2009,~~2012 for the 2012 plan year under the 401(k) Restoration SERP, as well as amounts contributed in ~~2010~~2013 for the ~~2009~~2012 plan ~~year.~~year under the 401(k) SERP.



³		These amounts represent aggregate earnings (or losses) on executive and registrant contributions. These amounts are not reflected in the “~~2009~~2012 Summary Compensation Table,” as they are not considered preferential or above-market earnings on deferred compensation.



⁴		This column reflects the balance of all contributions and the aggregate earnings (or losses) on such contributions. No portion of this amount is reflected in the “All Other Compensation” column ~~of the “~~~~2009 Summary Compensation Table~~~~” and, except for Executive Contributions and Registrant Contributions reflected in~~or the “Salary” column ~~in prior years, no portion~~ of ~~this amount was previously reported in our~~the “2012 Summary Compensation ~~Tables in prior years’ proxy statements.~~Table

⁵” except current-year Registrant Contributions and Executive Contributions, respectively.		~~Reflects a one-time adjustment to include the $74,519 401(k) SERP contribution made in 2009 for the 2008 fiscal year.~~

Table of Contents

Non-Qualified Deferred Compensation Plans

Deferred Incentive Compensation Plan

No. 2

Pursuant to our 1992 Deferred Incentive Compensation Plan, certain executives, including the Named Executive Officers, were able to defer cash bonuses received under our ~~cash bonus plan~~Annual Cash Bonus Plan and performance share awards earned under the 1991 Plan. Effective December 31, 2004, as a result of the passage by Congress of the American Jobs Creation Act of 2004, we elected to freeze the 1992 Deferred Incentive Compensation Plan and closed the plan to future deferrals. Effective January 1, 2005, the Board approved the Deferred Incentive Compensation Plan No. 2, which ~~was~~is substantially similar to the 1992 Deferred Incentive Compensation Plan in all material respects, but was designed to be administered in

accordance with Section 409A of the Internal Revenue Code.

Under the Deferred Incentive Compensation Plan No. 2, an executive may defer all or a portion of his or her ~~Annual Cash Bonus~~annual cash bonus or performance share earnout. Deferral elections for cash bonuses must be made prior to the end of the year preceding the year in which such bonuses would be earned (and payable in the following year). Deferral elections for performance shares must be made at least six months prior to the end of the three-year performance period specified in the grant. ~~None of~~Mr. Richardson is the only Named Executive ~~Officers currently has~~Officer who deferred any incentive compensation ~~deferred~~for 2012 under the Deferred Incentive Compensation Plan No. 2.

Deferrals of performance shares are treated as a line-item in the executive’s deferred account with us; however, the earnings on the performance shares (dividends and ~~interest thereon)~~interest) are invested in the same manner as deferrals of cash compensation. The Vanguard Group administers our cash deferrals. As such, cash deferrals are transferred to Vanguard on a quarterly basis, and the executive may invest such cash deferrals in any funds available under our 401(k) plan (except that the ~~Oppenheimer Developing Markets Fund and~~ Vanguard Prime Money Market Fund ~~are~~is not available in our 401(k) plan). The table below shows the funds available under the deferred compensation plans and their annual rate of return for the year ended December 31, ~~2009,~~2012, as reported by Vanguard.

Name of Fund Rate of Return Name of Fund Rate of Return
Vanguard Total Bond Market Index Fund 5.93% Vanguard International Value Fund 33.77%
Loomis Sayles Bond Fund 37.19% Vanguard Target Retirement Income 14.28%
Vanguard STAR Fund 24.85% Vanguard Target Retirement 2005 16.16%
Vanguard Windsor II Fund 27.05% Vanguard Target Retirement 2010 19.32%
Vanguard 500 Index Fund 26.49% Vanguard Target Retirement 2015 21.30%
Vanguard U.S. Growth Fund 34.95% Vanguard Target Retirement 2020 23.10%
Vanguard Prime Money Market Fund 0.53% Vanguard Target Retirement 2025 24.81%
Vanguard Selected Value Fund 36.26% Vanguard Target Retirement 2030 26.72%
Vanguard Mid-Cap Index Fund 40.22% Vanguard Target Retirement 2035 28.17%
Loomis Sayles Small Cap Value Fund 28.64% Vanguard Target Retirement 2040 28.32%
Vanguard Explorer Fund 36.21% Vanguard Target Retirement 2045 28.15%
Vanguard International Growth Fund 41.63% Vanguard Target Retirement 2050 28.31%
Oppenheimer Developing Markets Fund 81.71% Diebold Company Stock 5.25%



Name of Fund	Rate of Return		Name of Fund	Rate of Return
Vanguard Prime Money Market Fund	.04	%	Vanguard Target Retirement 2050	15.58	%
Loomis Sayles Bond Fund	15.13	%	Vanguard Target Retirement 2055	15.58	%
Vanguard Total Bond Market Index Fund	4.05	%	Vanguard Target Retirement 2060	—	%
Vanguard STAR Fund	13.79	%	Loomis Sayles SmC VI Fund	16.34	%
Vanguard Target Retirement Income	8.23	%	Vanguard 500 Index Fund	15.82	%
Vanguard Target Retirement 2010	10.12	%	Vanguard Explorer Fund	14.89	%
Vanguard Target Retirement 2015	11.37	%	Vanguard Mid-Cap Index Fund	15.80	%
Vanguard Target Retirement 2020	12.35	%	Vanguard Selected Value Fund	15.25	%
Vanguard Target Retirement 2025	13.29	%	Vanguard U.S. Growth Fund	18.43	%
Vanguard Target Retirement 2030	14.24	%	Vanguard Windsor II Fund	16.72	%
Vanguard Target Retirement 2035	15.16	%	Oppenheimer Developing Markets Fund	20.85	%
Vanguard Target Retirement 2040	15.56	%	Vanguard International Growth Fund	20.01	%
Vanguard Target Retirement 2045	15.58	%	Vanguard International Value Fund	20.18	%
			Diebold, Incorporated Stock	5.02	%

Executives deferring under the Deferred Incentive Compensation Plan No. 2 select their period of deferral and method of payment at the time of making their deferral elections. Executives may elect to defer their payments until a specified date or until the date they cease to be an associate of the company. Further, the executives may elect to receive their distribution either as a lump sum or in approximately equal quarterly installments, not to exceed 40 installments.

401(k) Restoration SERP

The 401(k) Restoration SERP is designed to replace lost retirement benefits due solely to IRS compensation limits. Benefits under this plan are determined exactly as in our 401(k) Plan except that compensation limits are ignored. Named Executive Officers are permitted to elect to defer compensation above the annual IRS limit and we provide a matching contribution at the same rate as under the 401(k) Plan. Vanguard administers the 401(k) Restoration SERP. Both the salary deferrals and our matching contributions are transferred to Vanguard and the executive may invest in any funds available under our Deferred Incentive Compensation Plan No. 2 (except ~~that~~ the ~~Oppenheimer Developing Markets Fund is not available in the 401(k) Restoration SERP)~~Vanguard Prime Money Market fund, as noted above).

401(k) SERP

The 401(k) SERP is designed to provide supplemental retirement benefits to executives hired after July 1, 2003, because those executives are not eligible to participate in the Qualified Retirement Plan and Pension SERP. Each year the executive is provided a contribution based upon a points formula (age plus service) as follows:

Table of Contents


~~Points~~
Points	Contribution Credit
Under 50		5	%5%
50-59		10	%10%
60-69		~~12.5~~	%12.5%
70-79		15	%15%
80 and over		20	%20%

Vanguard administers the 401(k) SERP. Our contributions are transferred to Vanguard and the executive may invest the contributions in any

investment funds available under our 401(k) Restoration SERP. The 401(k) SERP includes the Vanguard PRIMECAP Fund with a ~~2009~~2012 annual rate of return of ~~34.45%)~~15.27%.

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OFIN CONTROL

~~The table below reflects the amount of compensation payable to each of our Named Executive Officers in the event of termination of his or her employment.~~ The amount of compensation payable to each Named Executive Officer upon voluntary or involuntary termination (with and without cause), retirement, death, disability or in the event of achange-in-control (with and without termination) is described qualitatively in the following narrative and is shown quantitatively in the table below. The amounts shown assume that such termination or change-in-control was effective as of December 31, ~~2009,~~2012, and ~~thus~~ include amounts earned through such time and are estimates of the amounts that would be paid out to the executives upon his or her termination orchange-in-control. The actual amounts to be paid out can only be determined at the time of each Named Executive Officer’s ~~separation.~~separation, and accordingly, amounts shown for Ms. Pierce reflect those actually paid as a result of her stepping down in April 2012.

~~As described above under “~~~~Compensation Discussion and Analysis~~~~” and except for the employment agreement entered into with Mr. Swidarski described above under “~~~~Narrative Disclosure to 2009 Summary Compensation Table and 2009 Grants of Plan-Based Awards Table~~~~,” we have not entered into employment agreements with any other Named Executive Officer; however, we have entered intochange-in-control~~ ~~agreements with each of the Named Executive Officers.~~

Payments Made Upon Termination

Voluntary or Involuntary With Cause

Whether a Named Executive Officer’s employment terminates voluntarily or terminates involuntarily with cause, he or she is only entitled to base salary earned through the date of termination, along with any deferred compensation earnings payable upon separation from service and any benefits that have accrued under our Qualified Retirement Plan, and any SERP or 401(k) plan (except that no employer-paid SERP benefits are payable in the event of involuntary termination with cause). The Qualified Retirement Plan benefit, under both termination scenarios, and the SERP benefit, if termination is voluntary, is determined as described in “2012 Pension Benefits” above. If termination is voluntary, the ~~narrative~~values shown reflect the present value of the normal retirement benefit (at age 65) for the Qualified Retirement Plan, Pension SERP and Pension Restoration SERP. Note that the two nonqualified defined benefit plans specify the timing and form of payment (based on known participant elections). For Ms. Pierce, we have included the value of the Pension Restoration SERP payable January 1, 2014 when she is eligible to receive her benefit under her election form of payment of a 100% joint and survivor annuity due to her stepping down on April 18, 2012. Ms. Pierce was paid a lump sum equal to the value of her Qualified Retirement Plan benefit in December 2012, as part of a one-time window for eligible terminated vested participants to elect a lump sum. No additional benefits are payable from the Qualified Retirement Plan to Ms. Pierce.

If termination is involuntary with cause, only the portion of the 401(k) Restoration Plan benefit derived from employee contributions is payable to the Named Executive Officer. The entire 401(k) SERP balance is forfeited if termination is involuntary with cause. The 401(k) SERP and 401(k) Restoration SERP balances are not payable until the Named Executive Officer attains age 55.

Pursuant to the Severance Policy discussed in more detail above under “~~2009 Pension Benefits~~.Compensation Discussion and Analysis,”

a voluntary termination by a Named Executive Officer will be deemed a constructive termination thereby entitling him or her to the payments and benefits discussed below under “Involuntary Without Cause” upon the occurrence of any of the following events without the Named Executive Officer’s express written consent:

A material reduction in the amount of the executive’s then current base salary or target bonus;

We require the executive to change his or her principal location of work to any location which is in excess of 50 miles from his or her previous location of work;

Our failure to obtain in writing the obligation to perform or be bound by the terms of the Severance Policy by any successor company or any purchaser of all or substantially all of our assets; or

Any other action or inaction by us that constitutes a material breach of the terms and conditions of the Severance Policy.

Table of Contents

Involuntary Without Cause

If ~~however,~~ a Named Executive Officer is involuntarily terminated without cause, or a voluntary termination is deemed a constructive termination, pursuant to the Severance Policy, in addition to the foregoing, he or she ~~would also be~~is entitled to the ~~following:~~following (subject to a general release of claims and acknowledgment of the executive’s confidentiality and non-competition obligations):

A lump sum payment equal to one and one-half times base salary in effect on the date of termination and target bonus opportunity under our Annual Cash Bonus Plan in the year of termination (for Mr. Swidarski, two times base salary and target bonus);


•	~~Separation payments and continued participation in our employee health care plans pursuant to our Health Care Plan and Separation Benefits Plan applicable to allU.S.-based~~ employees, with the length of such benefits and payments ranging from one to six months, depending upon the executive’s years of service (and for Mr. Chen, such separation payments as are required by applicable law);

•	~~Lapse of the restrictions on outstanding restricted shares; and~~

•	~~A Qualified Retirement Plan benefit determined using the plan provisions as described in the narrative above under “~~~~2009 Pension Benefits~~.”

A pro-rata award under our Annual Cash Bonus Plan, based upon the time employed in the year of termination, to the extent such awards are otherwise earned, payable when such awards are generally paid to others;

Continued participation in all of our employee health and welfare benefit plans for a period of one and one-half years (for Mr. Swidarski, two years), or the date he or she receives equivalent coverage from a subsequent employer, excluding perquisites and any qualified or non-qualified pension or 401(k) plans;

All outstanding unvested options immediately vest and remain exercisable for a period of three months following the date of termination (pursuant to Mr. Swidarski’s employment agreement, his options remain exercisable for 2 years following separation of employment);

All outstanding RSUs vest pro-rata based upon the time employed in the year of termination relative to the deferral period of the RSUs;

Pro-rata performance share earnouts, based upon the time employed in the year of termination relative to the performance period, to the extent such awards are earned, payable when such awards are generally paid to others;

A Qualified Retirement Plan benefit using the plan provisions as described in “2012 Pension Benefits” above; and

Professional outplacement services for up to two years.

The Pension SERP, Pension Restoration SERP, 401(k) SERP and 401(k) Restoration SERP do not provide any additional benefits upon an involuntary termination. The Named Executive ~~officer would~~Officer is only be entitled to a SERP benefit if he or she otherwise qualifies for a normal, early or deferred vested SERP benefit at termination.

~~Mr.~~ For Messrs. Swidarski

~~Pursuant to Mr. Swidarski’s employment agreement, in~~ and Ducey, the ~~event~~values shown reflect the present value of ~~an involuntary termination without cause, in addition~~the normal retirement benefit (at age 65) for the Qualified Retirement Plan, Pension SERP and Pension Restoration SERP. Note that the two nonqualified defined benefit plans specify the timing and form of payment (based on known participant elections). However, due to the ~~benefits identified above, he would also be entitled~~forms of payment being actuarially equivalent and the absence of early retirement subsidies, this calculation approach is reasonable.

For Ms. Pierce, as a result of her stepping down from the Company effective as of April 18, 2012, we have included the value of the Pension Restoration SERP payable January 1, 2014 when she is eligible to receive her benefit under her elected form of payment of a 100% joint and survivor annuity. Ms. Pierce was paid a lump sum equal to the ~~following:~~value of her Qualified Retirement Plan benefit in December 2012, as part of a one-time window for eligible terminated vested participants to elect a lump sum. No additional benefits are payable from the Qualified Retirement Plan to Ms. Pierce.


•	~~A lump sum payment equal to 24 months’ base salary, as in effect on the date of termination;~~

•	A pro-rata award under our Cash Bonus Plan, based upon the time employed in the year of termination, to the extent such awards are otherwise earned, payable when such awards are generally paid to others;

•	~~A lump sum payment equal to twice the target bonus level for the year in which termination occurs under our Cash Bonus Plan;~~

•	~~All outstanding unvested options would immediately vest;~~

•	~~Pro-rata performance share earnouts, based upon the time employed in the year of termination relative to the performance period, to the extent~~


	~~such awards are earned, payable when such awards are generally paid to others; and~~


•	Continued participation in all of our employee health and welfare benefit plans for a period of 24 months (or the date he receives equivalent coverage from a subsequent employer), excluding perquisites and any qualified or non-qualified pension or 401(k) plans.

~~Under his employment agreement, Mr.~~For all Named Executive Officers, we have included the value of their vested nonqualified defined contribution balances, footnoting that these amounts are not payable until the Named Executive Officer attains age 55. For information related to the departures of Messrs. Swidarski ~~is subject to certain non-competition, non-solicitation~~ and ~~confidentiality obligations for a period of two years following termination of his employment.~~Ducey in early 2013, see “Employment and Separation Agreements” above.

Payments Made Upon Retirement

In the event of the retirement of a Named Executive Officer at or after the earliest voluntary retirement age, in addition to the benefits identified above under “Voluntary or Involuntary With Cause~~” and “~~~~Involuntary Without Cause,~~,” he or she ~~or she would also be~~is entitled to the following:

All outstanding unvested options immediately vest if the Named Executive Officer had attained the age of 65 and completed five or more years of continuous employment;


•	~~All outstanding unvested options awarded prior to 2007 would immediately vest;~~

•	~~All outstanding unvested options awarded after 2006 would immediately vest if the Named Executive Officer had attained the age of 65 and completed five or more years of continuous employment;~~

•	~~All outstanding RSUs awarded prior to 2007 would immediately vest and become nonforfeitable;~~

•	All outstanding RSUs awarded after 2006 would immediately vest and become nonforfeitable if the Named Executive Officer had attained the age of 65 and completed five or more years of continuous employment;

•	All outstanding RSUs awarded after 2006 would vest pro-rata based upon the time employed in the year of termination relative to the deferral period of the RSUs, if the sum of the Named Executive Officer’s age and years of continuous employment equals or exceeds 70; and

•	~~Pro-rata performance share earnouts, as described above.~~

All outstanding RSUs awarded prior to 2007 immediately vest and become nonforfeitable;

All outstanding RSUs awarded after 2006 immediately vest and become nonforfeitable if the Named Executive Officer had attained the age of 65 and completed five or more years of continuous employment;

All outstanding RSUs awarded after 2006 vest pro-rata based upon the time employed in the year of termination relative to the deferral period of the RSUs, if the sum of the Named Executive Officer’s age and years of continuous employment equals or exceeds 70; and

Pro-rata performance share earnouts, as described above.

Table of Contents

For the Qualified Retirement Plan, Pension SERP and Pension Restoration SERP, we have included the value of those benefits which are immediately payable if the Named Executive Officer were to retire as of December 31, 2012 and satisfy the retirement eligibility conditions. In 2012, Messrs. Swidarski and Ducey were able to retire under the terms of Diebold’s defined benefit plans. The amounts shown for Messrs. Swidarski and Ducey also include the value of their respective vested nonqualified defined contribution balances. Retirement eligibility is age 55 under the 401(k) SERP and the 401(k) Restoration SERP. For Messrs. Richardson, Mayes and Natoli, and Ms. Pierce, we have only included the value of their respective vested nonqualified defined contribution balances, which such amounts are not payable until the Named Executive Officer attains age 55.

Payments Made Upon Death or Disability

In the event of the death or disability of a Named Executive Officer, the Named Executive Officer or his or her estate or beneficiaries would receive the same equity benefits indicated above under “Payments Made Upon Retirement,” except that all outstanding and unvested options and RSUs, regardless of when awarded, would immediately vest and become nonforfeitable. In addition, the Named Executive Officer or his or her estate or beneficiaries would receive benefits under our disability plan or payments under our group term life insurance plan or any supplemental life insurance plan, as appropriate.

Named Executive Officers who die while actively employed are eligible for surviving spouse benefits from the Qualified Retirement Plan payable at the Named Executive Officer’s normal retirement date (or on an actuarially reduced basis at an early retirement date) if the Named Executive Officer had at least five years of service. The benefit is equal to 50% of the benefit payable if the Named Executive Officer terminated employment on the date of his death, survived to the payment date as elected by his or her spouse, and elected to begin receiving the 50% joint and survivor form of ~~payment and died the next day.~~payment. Benefits payable to the surviving spouse upon death of the Named Executive Officer from the Pension SERP and the Pension Restoration SERP are payable at the later of the executive’s early retirement date or date of death. For the Pension SERP, the death benefit is equal to the benefit that would have been payable to the Named Executive Officer if he or she terminated employment on the date of ~~his~~ death and survived to his or her first payment date. Named Executive Officers must have ten years of service at the time of ~~their~~ death for death benefits to be payable under the Pension SERP. For the Pension Restoration SERP, the death benefit is equal to 50% of the benefit, actuarially adjusted for the difference in age between the Named Executive Officer and spouse, that would have been payable to the executive if he or she terminated employment on the date of ~~his or her~~ death and survived to his or her first payment date. Named Executive Officers must have five years of service at the time of ~~their~~ death for ~~their~~ death benefits to be payable under the Pension Restoration ~~SERP~~SERP. The 401(k) SERP and 401(k) Restoration SERP pay a death benefit equal to the executive’s plan account if the executive had 10ten years of service and three years of service, respectively.

Disability benefits are payable immediately on an unreduced basis from the Qualified Retirement Plan based on service at the date of disability if the Named Executive Officer had at least 15 years of service and was determined to be totally and permanently disabled. Disability benefits under the Pension SERP, Pension Restoration SERP, ~~401(k) Restoration SERP,~~ and 401(k) SERP are payable immediately on an unreduced basis for disability after the Named Executive Officer has at least 15 years of service. Disability benefits under the 401(k) Restoration SERP are payable immediately on an unreduced basis.

For the defined benefit plans, we have shown the present value of the death benefits payable to the Named Executive Officer’s spouse in case of the Named Executive Officer’s death as of December 31, 2012. For the Qualified Retirement Plan, Pension SERP and Pension Restoration SERP, values shown reflect the present value of the normal retirement benefit (at age 65).

Under the disability scenario for the defined benefit plans, we have reflected the present value of the immediately payable benefit if the Named Executive Officer is eligible for disability as of the measurement date. In determining the value of the disability benefits, we used the 1985 Pension Disability Mortality Table and the assumptions noted under “Present Value of Accumulated Benefits” above.

For both the death and disability scenarios, for all Named Executive Officers, we have included the value of their vested nonqualified defined contribution balances which are payable immediately.

Mr. Swidarski

Pursuant to Mr. Swidarski’s employment agreement, in the event of his death in 2012, in addition to the benefits identified above, he ~~would also be~~was entitled to the following:

Base salary through the end of the month in which death occurs; and


•	~~Base salary through the end of the month in which death occurs; and~~

•	A pro-rata award under our Annual Cash Bonus Plan, as described above.

In the event of his permanent and total disability, in 2012, in addition to the benefits identified above, he would also behave been entitled to the following:


•	~~Disability benefits in accordance with the long-term disability program in effect for our senior executives, which in no event shall provide him with less than 60% of his base salary to age 65;~~

•	~~Base salary through the end of the month in which disability benefits commence;~~

•	~~A pro-rata award under our Annual Cash Bonus Plan, as described above; and~~

•	~~Continued participation in our employee health and welfare benefit plans for a period of 36 months, excluding perquisites and any qualified or non-qualified pension or 401(k) plans.~~

Table of Contents

Disability benefits in accordance with the long-term disability program in effect for our senior executives, which in no event will provide him with less than 60% of his base salary to age 65;

Base salary through the end of the month in which disability benefits commence;

A pro-rata award under our Annual Cash Bonus Plan, as described above; and

Continued participation in our employee health and welfare benefit plans for a period of 36 months, excluding perquisites and any qualified or non-qualified pension or 401(k) plans.

Payments Made Upon aChange-in-Control or Termination Following aChange-in-Control

In the event of achange-in-control, pursuant to the terms of the applicable equity compensation agreements, each Named Executive Officer ~~would be~~is automatically entitled to the following benefits:

All outstanding unvested options awarded prior to September 2009 immediately vest; and


•	~~Lapse of all restrictions on outstanding restricted shares awarded prior to September 2009;~~

•	~~All outstanding unvested options awarded prior to September 2009 would immediately vest;~~

•	~~All outstanding RSUs awarded prior to September 2009 would immediately vest and become nonforfeitable; and~~

•	~~All performance shares awarded prior to September 2009 would be deemed to have been earned in full (at target) and become immediately due and payable in the form of Common Shares.~~

All outstanding RSUs awarded prior to September 2009 immediately vest and become nonforfeitable.

For all equity compensation agreements entered into after September 2009, the foregoing benefits would immediately vest only in the event the Named Executive Officer’s employment is terminated without cause following achange-in-control or if the Named Executive Officer terminates his or her own employment under the circumstances identified below.

In addition to the aforementioned benefits, pursuant to thechange-in-control agreements described previously, if a Named Executive Officer’s employment is terminated without cause within three years following achange-in-control or if the Named Executive Officer terminates his or her employment within such time under the constructive termination circumstances identified below, in addition to the benefits indicated above, the Named Executive Officer ~~would be~~is entitled to the following benefits:

A lump sum payment equal to two times base salary (for Mr. Swidarski, three times base salary), as in effect on the date of termination; and


•	~~A lump sum payment equal to two times base salary (for Mr. Swidarski, three times base salary), as in effect on the date of termination; and~~

•	Continued participation in all of our employee retirement income, health and welfare benefit plans, including executive perquisites (or substantially similar plans) for a period of 12 months, excluding any equity compensation plans, with such benefits period being considered service for purposes of service credits under any of our qualified or non-qualified retirement plans (except that the continued service credit under any qualified plan shall be paid for by us).

For purposes of both the equity compensation agreements and thechange-in-control agreements, achange-in-control is deemed to occur upon any of the following events:

We are merged, consolidated or reorganized with another company, and as a result, less than a majority of the combined voting power of the then-outstanding securities is held by our shareholders of record immediately prior to such transaction;


•	We are merged, consolidated or reorganized with another company, and as a result, less than a majority of the combined voting power of the then-outstanding securities is held by our shareholders of record immediately prior to such transaction;

•	We sell or otherwise transfer all or substantially all of our assets, and as a result, less than a majority of the combined voting power of the then-outstanding securities is held by our shareholders of record immediately prior to such transaction;

There is a report filed with the SEC disclosing that any person or entity has become the beneficial owner of 20% or more of the combined voting power of our then-outstanding securities (except that for equity compensation agreements entered into after September 2009, the applicable beneficial ownership threshold is 30%);

We file a current report or proxy statement with the SEC disclosing that a change-in-control has or may have occurred or will or may occur in the future pursuant to any then-existing contract or transaction; or


•	There is a report filed with the SEC disclosing that any person or entity has become the beneficial owner of 20% or more of the combined voting power of our then-outstanding securities (except that for equity compensation agreements entered into after September 2009, the applicable beneficial ownership threshold is 30%);

•	We file a current report or proxy statement with the SEC disclosing that a change in control has or may have occurred or will or may occur in the future pursuant to any then-existing contract or transaction; or

•	If, during any period of two consecutive years, directors at the beginning of such period cease to constitute at least a majority of the board, unless the election or nomination for election of each director first elected during such period was approved by a vote of at least two-thirds of the directors then still in office who were directors at the beginning of such period cease to constitute at least a majority of the board, unless the election or nomination for election of each director first elected during the period was approved by a vote of at least two-thirds of the directors then still in office who were directors at the beginning of the period.

Further, for purposes of the equity compensation agreements entered into after September 2009 and thechange-in-control agreements, a voluntary termination by a Named Executive Officer upon a change-in-control will be deemed a constructive termination by us upon the occurrence of any of the following events:

Failure to elect, re-elect or otherwise maintain the executive in the offices or positions held prior to the change-in-control;


•	~~Failure to elect, re-elect or otherwise maintain the executive in the offices or positions held prior to thechange-in-control;~~

•	A significant adverse change in the nature or scope of the authorities, powers, functions, responsibilities or duties attached to the position held by the executive, or a reduction in his aggregate compensation or employee benefit plans;

•	~~A good faith determination by the executive that thechange-in-control~~ has rendered him or her substantially unable to carry out or has substantially hindered his or her ability to perform any of the authorities, powers, functions, responsibilities or duties attached to the position he or she held prior to the~~change-in-control;~~

•	~~We liquidate, dissolve, merge, consolidate or reorganize or transfer all or a significant portion of our business or assets, unless the successor has assumed all duties and obligations of thechange-in-control~~ ~~agreements; or~~

•	46 Table of Contents A significant adverse change in the nature or scope of the authorities, powers, functions, responsibilities or duties attached to the position held by the executive, or a reduction in his aggregate compensation or employee benefit plans; A good faith determination by the executive that the change-in-control has rendered him or her substantially unable to carry out or has substantially hindered his or her ability to perform any of the authorities, powers, functions, responsibilities or duties attached to the position he or she held prior to the change-in-control; We liquidate, dissolve, merge, consolidate or reorganize or transfer all or a significant portion of our business or assets, unless the successor has assumed all duties and obligations of the change-in-control agreements; or We relocate and require the executive to change his or her principal location of work to any location which is in excess of 25 miles from his or her previous location of work, or requires the executive to travel significantly more than was previously required.

For purposes of calculating the retirement benefits payable when achange-in-control occurs with termination, ~~the~~each Named Executive Officer actively employed as of December 31, 2012 is entitled to the following:

A Qualified Retirement Plan benefit determined using the plan provisions as described in “2012 Pension and Retirement Benefits” above plus an additional year of service and pay (base plus target bonus) in the benefit determination;


•	~~A Qualified Retirement Plan benefit determined using the plan provisions as described in the narrative above under “~~~~2009 Pension Benefits~~~~;” and~~

•	~~A SERP benefit based on the formula applicable for normal retirement.~~

A Pension SERP benefit based on the formula applicable for normal retirement including an additional 12 months of service and pay (base plus target bonus);

A Pension Restoration SERP benefit based upon the formula applicable for normal retirement including an additional 12 months of service and pay (base plus target bonus);

A Qualified 401(k) Plan benefit determined using the plan provisions as described in “Payments Made Upon Retirement” above plus an additional year of service and pay (base plus target bonus) in the benefit determination based upon the 401(k) Plan formula effective for 2013, however, the value of such benefit is paid from the 401(k) Restoration SERP;

A 401(k) Restoration SERP benefit with the extra year of service based upon the 401(k) Plan formula effective for 2013; and

A 401(k) SERP benefit including an additional 12 months of service and pay (base plus target bonus).

For ~~both~~ the Qualified Retirement Plan, the Pension SERP and ~~all~~the Pension Restoration SERP, we have reflected the present value of the accrued benefit payable at normal retirement (including the additional year of service and pay as noted above). Under the terms of the defined benefit SERPs, these benefits are ~~determined assuming continuous participation~~payable at the later of the executive’s early retirement date or the date of a change-in-control with termination.

For the 401(k) SERP and the 401(k) Restoration SERP, the change-in-control trigger provides for ~~an additional 12 months subsequent~~the immediate vesting of all defined contribution balances. These balances are not payable to ~~termination as described above (except that~~ the ~~continued service credit~~Named Executive Officer until he has attained at least age 55 under ~~any qualified plan shall be paid~~the terms of the nonqualified defined contribution plans. The change-in-control amount set forth in the “Post-Termination Payments Table” below was based on the updated target bonus percentage for ~~by us).~~

Mr. Mayes of 80% of salary for 2013.

Each of thechange-in-control agreements with the Named Executive Officers is substantially similar. A form of these amended and restated agreements ~~has been~~was filed as Exhibit 10.1 to our Annual Report onForm 10-K for the year ended December 31, 2008.

Effect of Certain Tax Regulations on Payments

Effect of Excise Tax on Parachute Payments

Under our existing change-in-control agreements as in effect for the Named Executive Officers, if any amount or benefit paid under the agreement, taken together with any amounts or benefits otherwise paid to the executives under any other agreement, are deemed to be “excess parachute payments” subject to excise tax under Sections 280G and 4999 of the Internal Revenue Code, we will reimburse the executive for the excise tax and any additional income, employment and excise taxes incurred on thegross-up payment. Any future change-in-control agreements will not include excise tax gross-ups.

47

Table of Contents

Effect of Section 409A on Timing of Payments

With respect to any severance amounts payable to our executives, any amounts that are not exempt from Section 409A of the Internal Revenue Code will be subject to the required six-month delay in payment after termination of service, provided that the executive is deemed a “specified employee” for purposes of Section 409A at the time of termination of service.

Post-Termination Payments Table

Change in

Involuntary
Involuntary
Change in
Control w/

Name Compensation Components Voluntary with Cause w/o Cause Retirement Death Disability Control Termination
Thomas W. Swidarski
Salary/Bonus $ — $ — 3,921,000 $ — 921,000 921,000 $ — 2,250,000
Accelerated Long-Term Incentives:
  Stock options — — 811,800 — 811,800 811,800 811,800 811,800
  Performance shares ¹ — — 2,181,167 2,181,167 2,181,167 2,181,167 3,698,500 3,698,500
  RSUs — — — — 1,138,000 1,138,000 1,138,000 1,138,000
Retirement Benefits:
  Qualified Retirement Plan/SERP ² 1,723,608 409,603 1,723,608 301,608 1,351,608 1,723,608 — 1,983,388
Other Benefits ³ — — 24,488 — — 1,410,732 ⁶ — 59,890
280G Excise Tax and Gross-up ⁴ — — — — — — — 4,936,917

Total: 1,723,608 409,603 8,662,063 2,482,775 6,403,575 8,186,307 5,648,300 14,878,495
Bradley C Richardson
Salary/Bonus — — 40,417 — — — — 970,000
Accelerated Long-Term Incentives:
  Stock options — — — — 66,600 66,600 66,600 66,600
  Performance shares ¹ — — — 51,371 51,371 51,371 154,114 154,114
  RSUs — — — — 678,533 678,533 678,533 678,533
Retirement Benefits:
  Qualified Retirement Plan/SERP ² — — — — — — — 58,638
Other Benefits ³ — — — — — — — 17,106
280G Excise Tax and Gross-up ⁴ — — — — — — — 1,082,642

Total: 0 0 40,417 51,371 796,504 796,504 899,247 3,027,633
James L.M. Chen
Salary/Bonus — — 293,128 — — — — 703,508
Accelerated Long-Term Incentives:
  Stock options — — — — 76,800 76,800 76,800 76,800
  Performance shares ¹ — — — 440,975 440,975 440,975 697,025 697,025
  RSUs — — — — 234,713 234,713 234,713 234,713
Other Benefits — — — — — — — 740,955

Total: 0 0 293,128 440,975 752,488 752,488 1,008,538 2,453,001
George S. Mayes, Jr.
Salary/Bonus — — 83,759 — — — — 670,072
Accelerated Long-Term Incentives:
  Stock options — — — — 76,800 76,800 76,800 76,800
  Performance shares ¹ — — — 440,975 440,975 440,975 697,025 697,025
  RSUs — — — — 128,025 128,025 128,025 128,025
Retirement Benefits:
  Qualified Retirement Plan/SERP ² 80,387 62,288 80,387 80,387 80,387 80,387 — 344,691
Other Benefits ³ — — — — — — — 191,126
280G Excise Tax and Gross-up ⁴ — — — — — — — 912,795

Total: 80,387 62,288 164,146 521,362 726,187 726,187 901,850 3,020,534
Charles E. Ducey, Jr.
Salary/Bonus — — 162,504 — — — — 650,016
Accelerated Long-Term Incentives:
  Stock options — — — — 76,800 76,800 76,800 76,800
  Performance shares ¹ — — — 440,975 440,975 440,975 697,025 697,025
  RSUs — — — — 128,025 128,025 128,025 128,025
Retirement Benefits:
  Qualified Retirement Plan/SERP ² 1,143,677 459,199 1,143,677 470,677 775,677 2,698,677 — 1,217,080
  Deferred Compensation Plan ⁵ 36,969 36,969 36,969 36,969 36,969 36,969 — 36,969
Other Benefits ³ — — — — — — — 42,793
280G Excise Tax and Gross-up ⁴ — — — — — — — 2,848,708

Total: 1,180,646 496,168 1,343,140 948,621 1,458,446 3,381,446 901,850 5,697,416
Leslie A. Pierce
Salary/Bonus — — 96,323 — — — — 462,352
Accelerated Long-Term Incentives:
  Stock options — — — — 36,570 36,570 36,570 36,570
  Performance shares ¹ — — — 165,959 165,959 165,959 298,725 298,725
  RSUs — — — — 8,108 8,108 8,108 8,108
Retirement Benefits:
  Qualified Retirement Plan/SERP ² 119,000 119,000 119,000 — 50,000 498,000 — 119,000
Other Benefits ³ — — — — — — — 16,937
280G Excise Tax and Gross-up ⁴ — — — — — — — 399,172

Total: 119,000 119,000 215,323 165,959 260,637 708,637 343,403 1,340,864
Kevin J. Krakora
Salary/Bonus — — 80,000 — — — — 640,000
Accelerated Long-Term Incentives:
  Stock options — — — — 135,300 135,300 135,300 135,300
  Performance shares ¹ — — — 782,375 782,375 782,375 1,209,125 1,209,125
  RSUs — — — — 213,375 213,375 213,375 213,375
Retirement Benefits:
  Qualified Retirement Plan/SERP 284,115 123,690 284,115 22,115 159,115 284,115 — 766,170
Other Benefits ³ — — — — — — — 41,158
280G Excise Tax and Gross-up ⁴ — — — — — — — 1,330,606

Total: 284,115 123,690 364,115 804,490 1,290,165 1,415,165 1,557,800 4,335,734



Name	Compensation Components	Voluntary ($)	Involuntary with Cause ($)	Involuntary w/o Cause ($)	Retirement ($)	Death ($)	Disability ($)	Change in Control ($)	Change in Control w/ Termination ($)
Thomas W. Swidarski*	Salary/Bonus	—	—	3,360,000	—	—	—	—	2,520,000
	Accelerated Long-Term Incentives:
	Stock options	—	—	1,321,441	—	1,321,441	1,321,441	1,321,441	1,321,441
	Performance shares¹	1,809,914	—	1,809,914	1,809,914	1,809,914	1,809,914	3,313,533	3,313,533
	RSUs	2,205,742	—	2,205,742	2,205,742	3,198,745	3,198,745	3,198,745	3,198,745
	Retirement Benefits:
	Qualified Retirement Plan/SERP²	4,845,778	855,218	4,485,778	3,708,852	4,215,065	5,574,269	—	5,128,142
	Other Benefits³	—	—	50,042	—	—	52,563	—	133,200
	280G Excise Tax and Gross-up⁴	—	—	—	—	—	—	—	3,189,669
	Total:	8,861,434	855,218	13,232,917	7,724,508	10,545,165	11,956,932	7,833,719	18,804,730
Bradley C. Richardson	Salary/Bonus	—	—	1,748,425	—	—	—	—	999,100
	Accelerated Long-Term Incentives:
	Stock options	—	—	193,650	—	193,650	193,650	193,650	193,650
	Performance shares¹	—	—	366,097	—	366,097	366,097	702,500	702,500
	RSUs	—	—	270,631	—	550,980	550,980	550,980	550,980
	Retirement Benefits:
	Qualified Retirement Plan/SERP²	294,391	132,826	294,391	294,391	294,391	294,391	600,234	600,234
	Deferred Compensation Plan⁵	700,735	700,735	700,735	700,735	700,735	700,735	700,735	700,735
	Other Benefits³	—	—	47,570	—	—	—	—	37,535
	280G Excise Tax and Gross-up⁴	—	—	—	—	—	—	—	1,202,375
	Total:	995,126	833,561	3,621,499	995,126	2,105,853	2,105,853	2,748,099	4,987,109
Charles E. Ducey, Jr.*	Salary/Bonus	—	—	1,008,845	—	—	—	—	768,644
	Accelerated Long-Term Incentives:
	Stock options	—	—	62,775	—	62,775	62,775	62,775	62,775
	Performance shares¹	403,092	—	403,092	403,092	673,420	673,420	673,420	673,420
	RSUs	234,418	—	234,418	234,418	234,418	234,418	693,317	693,317
	Retirement Benefits:
	Qualified Retirement Plan/SERP²	2,931,633	917,168	2,931,633	2,393,985	1,550,091	2,748,751	—	2,939,277
	Deferred Compensation Plan⁵	45,691	45,691	45,691	45,691	45,691	45,691	—	45,691
	Other Benefits³	—	—	35,264	—	—	—	—	37,765
	280G Excise Tax and Gross-up⁴	—	—	—	—	—	—	—	—
	Total:	3,614,834	962,859	4,721,718	3,077,186	2,566,395	3,765,055	1,429,512	5,220,889
George S. Mayes, Jr.	Salary/Bonus	—	—	1,073,086	—	149,093	149,093	—	853,087
	Accelerated Long-Term Incentives:
	Stock options	—	—	42,300	—	42,300	42,300	42,300	42,300
	Performance shares¹	—	—	259,875	—	259,875	259,875	479,047	479,047
	RSUs	—	—	382,504	—	642,810	642,810	642,810	642,810
	Retirement Benefits:
	Qualified Retirement Plan/SERP²	205,142	153,344	205,142	205,142	205,142	205,142	—	811,654
	Other Benefits³	—	—	34,820	—	—	—	—	37,469
	280G Excise Tax and Gross-up⁴	—	—	—	—	—	—	—	—
	Total:	205,142	153,344	1,997,727	205,142	1,299,220	1,299,220	1,164,157	2,866,367

Table of Contents



Name	Compensation Components	Voluntary ($)	Involuntary with Cause ($)	Involuntary w/o Cause ($)	Retirement ($)	Death ($)	Disability ($)	Change in Control ($)	Change in Control w/ Termination ($)
Frank A. Natoli, Jr.	Salary/Bonus	—	—	644,773	—	117,283	117,283	—	586,163
	Accelerated Long-Term Incentives:
	Stock options	—	—	11,190	—	11,190	11,190	11,190	11,190
	Performance shares¹	—	—	247,370		552,511	552,511	552,511	552,511
	RSUs	—	—	125,620		125,620	125,620	255,594	255,594
	Retirement Benefits:
	Qualified Retirement Plan/SERP²	63,985	43,586	63,985	63,985	63,985	63,985	—	78,335
	Other Benefits³	—	—	33,053	—	—	—	—	12,035
	280G Excise Tax and Gross-up⁴	—	—	—	—	—	—		444,620
	Total:	63,985	43,586	1,125,991	63,985	870,589	870,589	819,295	1,940,448
Leslie A. Pierce⁶	Salary/Bonus	—	—	873,471	—	—	—	—	—
	Accelerated Long-Term Incentives:
	Stock options	—	—	123,058	—	—	—	—	—
	Performance shares¹	—	—	62,169	—	—	—	—	—
	RSUs	—	—	84,777	—	—	—	—	—
	Retirement Benefits:
	Qualified Retirement Plan/SERP²	—	—	241,787	—	—	—	—	—
	Other Benefits	—	—	216,529	—	—	—	—	—
	Total:	—	—	1,601,791	—	—	—	—	—


¹		~~Assuming~~For purposes of the 2010 to 2012 performance period, the actual payout was 30%. For the 2011 to 2013 and 2012 to 2014 performance periods, payout was assumed to be at target levels. The payouts actually realized by each Named Executive Officer may be lower or higher depending upon the actual level of performance ~~shares at target.~~achieved.



²		The assumptions used to calculate the value of the Qualified Retirement Plan, Pension SERP and Pension Restoration SERP benefits are consistent with those used to calculate the values above under “~~2009~~2012 Pension and Retirement Benefits.” Further, the Named Executive Officers are assumed to have terminated employment on December 31, ~~2009~~2012 and received the value of their benefits assuming payment begins at normal retirement or immediately, if eligible, at December 31, ~~2009.~~2012. The values were determined as of December 31, ~~2009~~2012 based on compensation and service as of that date. In addition, these values represent total values to the Named Executive Officer under the given termination scenario. Retirement eligibility is age 50 with 70 points under the Qualified Pension, the Pension SERP and Pension Restoration SERP, and age 55 under the 401(k) SERP and the 401(k) Restoration SERP. The amounts shown above exclude the Qualified 401(k) Plan information. All of the Named Executive Officers are vested in the 401(k) Restoration SERP. Mr. Richardson is not vested in employer contributions in either the 401(k) Restoration SERP or the 401(k) SERP. Neither Messrs. Mayes nor Richardson is vested in the 401(k) SERP. The value of Ms. Pierce’s Qualified Retirement Plan is excluded due to lump sum payment made in December 2012 totaling $241,787, and includes the present value of the Pension Restoration SERP payable as of January 1, 2014 when Ms. Pierce is eligible for retirement under her elected form of payment.



³		“Other Benefits” includes, as applicable, the total value of any other contributions by us on behalf of the Named Executive Officer for retirement income, health and welfare benefit plans, including executive perquisites, which the Named Executive Officer was eligible to receive as of December 31, ~~2009.~~2012. For Ms. Pierce, “Other Benefits” also includes accrued vacation and attorneys fees related to her separation agreement, as noted in the “Summary Compensation Table” above.



⁴		Upon a ~~change in control~~change-in-control of the company, the executive may be subject to certain excise taxes pursuant to Section 280G of the Internal Revenue Code. We have agreed to reimburse the executive for all excise taxes that are imposed on the executive under Section 280G and any income or other taxes that are payable by the executive as a result of any reimbursements for Section 280G taxes. The calculation of the 280Ggross-up amount is based upon a 280G excise tax rate of 20%. For purposes of the 280G calculation, it is assumed that no amounts will be discounted as attributable to reasonable compensation and no value will be attributed to the executive executing a non-competition agreement.



⁵		Distribution of the amounts reflected for deferred compensation remains subject to the deferral elections made by the executive, as discussed above under “Non-Qualified Deferred Compensation Plans.” Mr. Ducey has elected a lump sum distribution on the date he ceases to be an associate and, therefore, the amounts in this row reflect the value, as of December 31, 2009, of 1,180 Common Shares deferred by Mr. Ducey as of December 31, 2009, including any dividends and interest on such deferred Common Shares. For more detail on the aggregate balance of Mr. Ducey’s deferred compensation, see above under “~~2009 Non-Qualified Deferred Compensation.~~”



⁶		~~This amount includes~~ Amounts for Ms. Pierce reflect payments actually made pursuant to her separation agreement, as noted in the “Employment and Separation Agreements” above. Specifically, the intrinsic value of ~~Mr. Swidarski’s long-term disability benefits, determined as of December 31, 2009, in excess~~her accelerated stock options and pro-rated RSUs have been calculated using the closing market price of the ~~benefits payable~~company’s shares on April 18, 2012, the effective date of her separation. The value of her pro-rated performance share awards are reflected in ~~our Long-Term Disability Plan. The amount of Mr. Swidarski’s long-term disability benefits of $1,374,000 is determined~~the same manner as the ~~present value of a fixed-term annuity, payable from Mr. Swidarski’s current age to age 65, based on a discount rate of 6.33%.~~other Named Executive Officers.

REPORT OF AUDIT COMMITTEE

~~As noted above, the~~The Audit Committee is currently comprised of ~~Henry D. G. Wallace,~~Patrick W. Allender, Chair, Bruce L. Byrnes, Mei-Wei Cheng ~~Richard L. Crandall, Philip B. Lassiter~~ and Alan J. Weber. Each member of the committee is independent as defined in Section 303A.02 of the NYSE corporate governance standards. The primary duties and responsibilities of the committee are ~~as follows: (a)~~(1) to monitor the adequacy of our financial reporting process and systems of internal controls regarding finance, accounting and legal ~~compliance; (b)~~compliance, (2) to monitor the independence and performance of our outside auditors and internal audit ~~department;~~department, and ~~(c)~~(3) to provide an avenue of communication among the outside auditors, management, the internal audit department and the Board. The Board has adopted an Audit Committee Charter, which is available on our web site athttp://~~www.diebold.com.~~www.diebold.com.

The Audit Committee has reviewed and discussed with our management and KPMG LLP, our independent ~~auditors, our~~registered public accounting firm, the audited financial statements contained in our Annual Report to Shareholders for the year ended December 31, ~~2009.~~2012. The Audit Committee has also discussed with our independent ~~auditors~~registered public accounting firm the

Table of Contents

matters required to be discussed pursuant to SAS No. 61, as amended (AICPA,Professional Standards, Vol. 1. AU Section 380), as adopted by the Public Company Accounting Oversight Board in Rule 3200T.

The Audit Committee has received and reviewed the written disclosures and the letter from KPMG LLP required by applicable requirements of the Public Company Accounting Oversight Board regarding KPMG LLP’s communications with the Audit Committee concerning independence, and has discussed with KPMG LLP its independence. The Audit Committee has also considered whether the provision of ~~information technology services and other~~ non-audit services to us by KPMG LLP is compatible with maintaining its independence.

Based on the review and discussions referred to above, the Audit Committee recommended to the Board of Directors that the audited financial statements be included in our Annual Report onForm 10-K for the fiscal year ended December 31, ~~2009~~2012 filed with the SEC.

The foregoing report was submitted by the Audit Committee of the Board and shall not be deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A promulgated by the SEC or Section 18 of the ~~Securities~~ Exchange ~~Act of 1934.~~Act.

The Audit Committee:

Patrick W. Allender, Chair

~~Henry D. G. Wallace, Chair~~Bruce L. Byrnes

Mei-Wei Cheng

~~Richard L. Crandall~~

~~Philip B. Lassiter~~

Alan J. Weber

PROPOSAL ~~NO.~~ 2: RATIFICATION OF APPOINTMENT OF OUR

INDEPENDENT ~~AUDITORS~~

~~KPMG LLP acted as our independent auditors during the past fiscal year, and has so acted since 1965.~~

REGISTERED PUBLIC ACCOUNTING FIRM

The Audit Committee has again appointed KPMG LLP, our independent registered public accounting firm since 1965, to examine our accounts and other records for the fiscal year ending December 31, ~~2010. The Board will present~~2013. This appointment is being presented to you for ratification at the Annual ~~Meeting a proposal that such appointment be ratified. Should~~Meeting. If the shareholders fail to ratify the ~~appointment;~~appointment, the Audit Committee will reconsider its selection.

KPMG LLP has no financial interest, direct or indirect, in us or any of our subsidiaries.

A representative of KPMG LLP is expected to be present at the ~~annual meeting,~~Annual Meeting, to make a statement if he or she desires ~~to do so~~ and to respond to appropriate questions.

Audit and Non-Audit Fees

The following table shows the aggregate fees billed to us for the annual audit and review of the interim financial statements and other services provided by KPMG LLP for fiscal ~~2009~~2012 and ~~2008.~~2011.

2009 2008

Audit Fees¹
$ 3,742,100 $ 4,839,739
Audit-Related Fees²
0 1,631,256
Tax Fees³
1,086,398 858,363
All Other Fees⁴
0 0

Total $ 4,828,498 $ 7,329,358



	2012	2011
Audit Fees¹	$3,367,593	$3,979,841
Audit-Related Fees²	$178,747	$396,492
Tax Fees³	$763,796	$641,370
All Other Fees⁴	$45,000	—
Total	$4,355,136	$5,017,703


¹		“Audit Fees” consist of fees billed for professional services rendered for the audit of our annual financial statements and the review of the interim financial statements included in quarterly reports and services that are normally provided by KPMG LLP in connection with statutory and regulatory filings.


²		“Audit-Related Fees” consist of fees billed related to ~~our SEC investigation and~~ the ~~restatement~~remediation of our internal financial ~~statements.~~controls and our global FCPA review.


³		“Tax Fees” consist of fees billed for professional services rendered for tax compliance, tax advice and tax planning, both domestic and international. These services include assistance regarding federal, state and international tax compliance, acquisitions and international tax planning.


⁴		“All Other Fees” consist of fees billed for those services not captured in the audit, audit-related and tax categories. We generally do not request such services from ~~the~~our independent ~~auditors.~~registered public accounting firm; however, for 2012 these fees consist of transaction advisory services for our subsidiary in Turkey.

Table of Contents

Policy on Audit Committee Pre-Approval of Audit and Permissible
Non-Audit Services of Our Independent ~~Auditors~~

Registered Public Accounting Firm

Consistent with SEC policies regarding auditor independence, the Audit Committee has responsibility for appointing, setting compensation and overseeing the work of our independent ~~auditors.~~registered public accounting firm. In recognition of this responsibility, the Audit Committee has established a policy to pre-approve all audit and non-audit services provided by the independent ~~auditors.~~

registered public accounting firm.

These services may include audit services, audit-related services, tax services and other services. Pre-approval is generally provided for and any pre-approval is detailed as to the particular service or category of services and is generally subject to a specific budget. The Audit Committee has delegated pre-approval authority to ~~Henry D. G. Wallace,~~Patrick W. Allender, Chair of the Audit Committee (as of January 19, 2013), when expedition of services is necessary, provided that Mr. ~~Wallace~~Allender must report any decisions to pre-approve to the full Audit Committee at its next scheduled meeting. All of the fees included under the categories “Audit-Related Fees,” “Tax Fees” and “All Other Fees” above were pre-approved by the Audit Committee. None of these fees were approved by the Audit Committee after services were rendered pursuant to the de minimis exception established by the SEC.

~~THE BOARD RECOMMENDS A VOTEFOR~~ ~~RATIFICATION OF~~
~~THE APPOINTMENT OF OUR INDEPENDENT AUDITORS.~~

~~EQUITY COMPENSATION PLAN INFORMATION~~

Recommendation of the Board

The board recommends a vote FOR ratification of the appointment of KPMG LLP as our independent registered public accounting firm.

PROPOSAL 3: ADVISORY VOTE TO APPROVE NAMED EXECUTIVE OFFICER

COMPENSATION

In this Proposal 3, as required by Section 14A of the Exchange Act and pursuant to Rule 14a-21(a) promulgated thereunder, we are providing our shareholders the opportunity to cast an advisory (non-binding) vote to approve the compensation paid to the company’s Named Executive Officers, as disclosed in “Compensation Discussion and Analysis” and “Executive Compensation” above, pursuant to the compensation rules of the SEC. While this vote is advisory, and not binding on the company, the Board values the opinions of our shareholders and the Compensation Committee will review the results of the vote and expects to take it into consideration when making future decisions regarding executive compensation. Under current Board policy, the shareholder vote for advisory approval of named executive officer compensation will occur annually. The next such vote will occur at our 2014 Annual Meeting of Shareholders.

“Compensation Discussion and Analysis” and “Executive Compensation” describe our executive compensation program and the decisions and rationale of our Compensation Committee. Our executive pay program is designed to enable us to attract, retain and motivate high quality executives who will provide dynamic leadership to the company and are instrumental to the success of the company. We emphasize performance-based variable pay through a mix of base salary, annual cash bonuses and long-term incentives and seek to provide total pay that is commensurate with our performance and competitive with our peer group. Accordingly, we are asking our shareholders to vote FOR the following ~~table provides information about our Common Shares~~resolution:

“RESOLVED, that ~~may be issued upon~~ the ~~exercise~~compensation of ~~options, warrants~~the named executive officers of the company as disclosed pursuant to the compensation rules of the SEC, including the Compensation Discussion and ~~rights under existing equity~~Analysis, the compensation ~~plans~~tables and ~~our Common Shares that remain available for future issuance as~~any related material disclosed in this proxy statement, is hereby APPROVED.”

Recommendation of ~~December 31, 2009.~~the Board

Number of securities remaining available

Number of securities to be issued
Weighted-average exercise price
for future issuance under equity

upon exercise of outstanding
of outstanding options, warrants
compensation plans (excluding securities

options, warrants and rights
and rights
reflected in column (a))

Plan category (a) (b) (c)
Equity compensation plans approved by security holders 3,831,643 $ 37.84 4,523,719
Equity compensation plans not approved by security holders — — —
Total:
3,831,643 $ 37.84 4,523,719

~~PROPOSAL NO. 3: RE-APPROVAL OF THE DIEBOLD, INCORPORATED ANNUAL CASH BONUS PLAN~~

The Board recommends ~~a vote for re-approval~~that you indicate your approval of the existing Diebold, Incorporated Annual Cash Bonus Plan (the “Cash Bonus Plan”). Incentive bonus payments made under the Cash Bonus Plan are intended to constitute qualified “performance-based compensation” for purposes of Section 162(m) of the Internal Revenue Code, as amended, and~~Section 1.162-27~~ ~~of the Treasury Regulations promulgated thereunder.~~

~~Generally, Section 162(m) prevents a company from receiving a federal income tax deduction for~~company’s named executive officer compensation paid to its Chief Executive Officer or certain of its most highly compensated executive officers in excess of $1.0 million for any year, unless that compensation is performance-based. One of the requirements of “performance-based compensation” for purposes of Section 162(m) is that the compensation be paid pursuant to a plan that has been approved by the Company’s shareholders every five years. The Cash Bonus Plan was previously approved by the Company’s shareholders in 2005. Unless re-approved, it will expire upon the first shareholder meeting in 2010.

As in the past, the Cash Bonus Plan will require the Compensation Committee to use goals and formulas that could be verified by an independent third party to fund bonuses, without the exercise of discretion, except to reduce the amount of compensation that might otherwise be payable under the Cash Bonus Plan.

voting FOR Proposal 3.

~~Summary of Terms~~

~~The following is a summary of the terms of the Cash Bonus Plan and is qualified in its entirety by reference to the complete text of the Cash Bonus Plan, which is set forth inExhibit A.~~

~~Administration~~

The Cash Bonus Plan shall be administered by the Compensation Committee or any other committee appointed by the Board to administer the Cash Bonus Plan (consisting of at least two directors, each of whom must be an “outside director” within the meaning of Section 162(m)). In administering the Cash Bonus Plan, the Compensation Committee shall have full power and authority to interpret and administer the Cash Bonus Plan and shall have the exclusive right to establish Management Objectives (as defined below) and the amount of incentive bonuses payable upon achievement of such objectives.

~~Eligible Executive~~

Participation in the Cash Bonus Plan will be limited to an “Eligible Executive,” which is defined as the Company’s Chief Executive Officer and each other executive officer or other employee of the Company designated by the Compensation Committee. At present, under the Cash Bonus Plan, there would be approximately 28 Eligible Executives, including the Named Executive Officers, participating.

~~Management Objectives~~

An Eligible Executive’s right to receive a bonus under the Cash Bonus Plan depends on achievement of certain specified performance goals, referred to as “Management Objectives.” Management Objectives may be described in terms of Company-wide objectives or objectives that are related to the performance of the individual Eligible Executive or of the

subsidiary, division, department or function within the Company or subsidiary in which the Eligible Executive is employed. The Management Objectives shall be limited to specified levels of, growth in or relative peer company performance in one or more of the following: earnings per share; return on invested capital; return on total capital; return on assets; return on equity; total shareholder return; growth in net income, revenue, cash flow or operating profit;~~and/or~~ ~~productivity improvement.~~

~~Awards~~

Not later than the 90th day of each fiscal year of the Company, the Compensation Committee shall establish the Management Objectives for all Eligible Executives and the amount of incentive bonus payable (or formula for determining such amount) upon full achievement of the specified Management Objectives. The Compensation Committee may further specify in respect of the specified Management Objectives a minimum acceptable level of achievement below which no incentive bonus payment will be made and shall set forth a formula for determining the amount of any payment to be made if performance is at or above the minimum acceptable level but falls short of full achievement of the specified Management Objectives. The Compensation Committee may not modify any terms of awards established (other than in connection with an Eligible Executive’s death or disability, or a change in control), except to the extent that after such modification the incentive bonus would continue to constitute qualified “performance-based compensation” for purposes of Section 162(m).

~~The Compensation Committee retains the discretion to reduce the amount of any incentive bonus that would be otherwise payable to an Eligible Executive (including a reduction in such amount to zero).~~

Notwithstanding any other provision of the Cash Bonus Plan to the contrary, in no event shall the incentive bonus paid to an Eligible Executive under the Cash Bonus Plan for a year exceed $2.75 million.

~~Committee Certification~~

As soon as practicable after the end of each fiscal year of the Company, the Compensation Committee shall determine whether the Management Objective has been achieved and the amount of the incentive bonus to be paid to each Eligible Executive for such fiscal year and shall certify such determinations in writing.

~~Amendment and Termination~~

The Committee may amend the plan from time to time, provided that any such amendment is subject to shareholder approval to the extent required to satisfy Section 162(m). The Committee may also terminate the plan, on a prospective basis only, at any time.

~~Effective Date~~

Subject to its re-approval by the shareholders, the Cash Bonus Plan shall remain effective until the first annual meeting of shareholders held in the 2015 fiscal year, subject to any further shareholder approvals (or re-approvals) mandated for performance-based compensation under Section 162(m).

~~Cash Bonus Plan Benefits~~

Since the Cash Bonus Plan affords the Compensation Committee discretion in establishing target bonuses and payouts (subject to the $2.75 million annual limit per person noted above), it is not possible to determine the amount of the benefits that may become payable under the Cash Bonus Plan. The Cash Bonus Plan was in effect for 2009, so the bonuses that would have been payable to the Named Executive Officers under the re-approved Cash Bonus Plan for 2009 would have been identical to the bonuses actually paid to the Named Executive Officers for 2009, as provided in the “~~Summary Compensation Table~~~~” above.~~

~~If the Cash Bonus Plan is not re-approved by shareholders, no bonuses will be paid under such plan for fiscal years beginning on or after January 1, 2011.~~

~~Federal Income Tax Consequences~~

Under present federal income tax law, a Cash Bonus Plan participant will be taxed at ordinary income rates on the amount of any payment received pursuant to the Cash Bonus Plan. Generally, and subject to the provisions of Section 162(m), the Company will receive a federal income tax deduction corresponding to the amount of income recognized by a Cash Bonus Plan participant.

~~THE BOARD RECOMMENDS A VOTEFOR~~ ~~THE APPROVAL OF THE~~
~~CORPORATION’S ANNUAL CASH BONUS PLAN.~~

SHAREHOLDERS SHARING THE SAME ADDRESS

Some banks, brokers and other intermediaries engage in the practice of “householding” our proxy statements and annual reports. This means that, ~~only one~~if shareholders within the same household request a physical copy of our proxy statement and annual report, ~~to shareholders~~only one copy may be sent to ~~multiple shareholders in your~~that household unless ~~you~~the shareholders specifically request ~~otherwise.~~to receive multiple copies. We will promptly deliver a separate copy of our Annual Report onForm 10-K for the year ended December 31, ~~2009~~2012 or this proxy statement to you if you share an address subject to householding. Please contact our ~~Corporate~~ Secretary at 5995 Mayfair Road, P.O. Box 3077, North Canton, Ohio44720-8077 or(330) 490-4000.

Please contact your bank, broker or other intermediary if you wish to receive individual copies of our proxy materials in the future. Please contact your bank, broker or other intermediary, or our Corporate Secretary as provided above if members of your household are currently receiving individual copies and you would like to receive a single household copy for future meetings.

Table of Contents

EXPENSES OF SOLICITATION

The cost of soliciting the proxies will be paid by ~~us.~~the company. In addition to solicitation by mail, some of our directors, officers and employees, without extra compensation, may conduct additional solicitations by telephone, facsimile and personal interviews. We may also enlist, at our own cost, the assistance of banks, bankers and brokerage houses in additional solicitations of proxies and proxy authorizations, particularly from those of their clients or customers whose shares are not registered in the clients’ or customers’ own names. Brokers, bankers, etc., will be reimbursed forout-of-pocket and reasonable clerical expenses incurred in obtaining instructions from beneficial owners of the ~~Common Shares.~~common shares. It is estimated that the expense of such special solicitation will be nominal. In addition, ~~Laurel Hill Advisory Group, LLC,~~Innisfree M&A Incorporated, New York, New York, has been retained to assist in the solicitation of proxies for an estimated fee of ~~$7,000.~~$15,000.

SHAREHOLDER PROPOSALS ~~OF SHAREHOLDERS~~

We must receive by November ~~16, 2010,~~11, 2013 any proposal of a shareholder intended to be presented at our ~~2011~~2014 Annual Meeting of Shareholders and to be included in our proxy, notice of meeting and proxy statement related to the ~~2011~~2014 Annual Meeting pursuant toRule 14a-8 under the ~~Securities~~ Exchange ~~Act of 1934.~~Act. Such proposals should be submitted to our Corporate Secretary at our principal executive office by certified mail, return receipt requested.

Notice of proposals of shareholders submitted outside the processes ofRule 14a-8 under the Exchange Act, including nominations of directors, which a shareholder intends to present at our ~~2011~~2014 Annual Meeting, but which will not be included in our proxy, notice of meeting and proxy statement related to the ~~2011~~2014 Annual Meeting,(“ or non-Rule 14a-8 ~~Proposals”),~~ proposals, must be received by us at our principal executive office on or between December ~~15, 2010~~11, 2012 and January ~~15, 2011~~10, 2014 (or, if the ~~2011~~2014 Annual Meeting is held more than 30 days prior to or after April ~~29, 2011,~~25, 2014, not later than the close of business on the later of the 90th day prior to the ~~2011~~2014 Annual Meeting or the 10th day following the day on which public announcement of the date of the ~~2011~~2014 Annual Meeting is first made), or such proposals will be considered untimely under the advance notice provisions of our ~~Code~~code of ~~Regulations.~~regulations.

Non-Rule 14a-8 ~~Proposals~~ proposals must comply with certain provisions of our ~~Code~~code of ~~Regulations.~~regulations. Our proxy related to the ~~2011~~2014 Annual Meeting will give discretionary authority to the Proxy Committee to vote with respect to allnon-Rule 14a-8 ~~Proposals~~ proposals properly brought before the ~~2011 meeting.~~2014 Annual Meeting.

OTHER MATTERS

We are not aware of any matters to be presented at the2013 Annual Meeting other than the matters set forth herein. Should any other matters be presented for a vote of the shareholders, the proxy in the enclosed form confers discretionary voting authority upon the Proxy Committee. In accordance with the provisions of ~~the General Company Law of the State of~~ Ohio Revised Code, the Board has appointed inspectors of elections to act at the 2013Annual Meeting.

For information on how to obtain directions to be able to attend the2013 Annual Meeting and vote in person, please see the directions at the end of this proxy statement or contact our Corporate Secretary at 5995 Mayfair Road, P.O. Box 3077, North Canton, Ohio44720-8077 or(330) 490-4000.

~~Important Notice Regarding the Availability of Proxy Materials for~~
~~the Annual Meeting of Shareholders to be held on April 29, 2010.~~

~~This proxy statement, along with our Annual Report for the year ended December 31, 2009, are available free of chargewww.proxyvote.com~~ ~~(you will need to reference the 12 Digit Control Number found on your proxy card).~~

By Order of the Board of Directors

~~CHAD~~Chad F. ~~HESSE~~Hesse

~~Senior Corporate~~Vice President, General Counsel and ~~Corporate~~ Secretary

Canton, Ohio

March ~~16, 2010~~13, 2013

~~Exhibit A~~52

~~DIEBOLD, INCORPORATED~~

~~ANNUAL CASH BONUS PLAN~~Table of Contents

1. ~~Purpose.~~The purpose of the Annual Cash Bonus Plan (the “Plan”) is to attract and retain key executives for Diebold, Incorporated, an Ohio corporation (the “Corporation”), and its Subsidiaries and to provide such persons with incentives for superior performance. Incentive Bonus payments made under the Plan are intended to constitute qualified “performance-based compensation” for purposes of Section 162(m) of the Internal Revenue Code of 1986, as amended, and~~Section 1.162-27~~ ~~of the Treasury Regulations promulgated thereunder, and the Plan shall be construed consistently with such intention.~~

2. ~~Definitions.~~~~As used in this Plan,~~

~~“Board”~~~~means the Board of Directors of the Corporation.~~

~~“Code”~~~~means the Internal Revenue Code of 1986, as amended from time to time.~~

~~“Committee”~~means the Compensation Committee of the Board or any other committee appointed by the Board to administer the Plan; provided, however, that in any event the Committee shall be comprised of not less than two directors of the Corporation, each of whom shall qualify as an “outside director” for purposes of Section 162(m) of the Code and~~Section 1.162-27(e)(3)~~ ~~of the Regulations.~~

~~“Eligible Executive”~~~~means the Corporation’s Chief Executive Officer and any other executive officer or other employee of the Corporation designated by the Committee.~~

~~“Incentive Bonus”~~~~shall mean, for each Eligible Executive, a bonus opportunity amount determined by the Committee pursuant to Section 5 below.~~

~~“Management Objectives”~~means the achievement of a performance objective or objectives established pursuant to this Plan for Eligible Executives. Management Objectives may be described in terms of Corporation-wide objectives or objectives that are related to the performance of the individual Eligible Executive or of the Subsidiary, division, department or function within the Corporation or Subsidiary in which the Eligible Executive is employed. The Management Objectives shall be limited to specified levels of, growth in or relative peer company performance in one or more of the following:

~~(i) earnings per share;~~

~~(ii) return on invested capital;~~

~~(iii) return on total capital;~~

~~(iv) return on assets;~~

~~(v) return on equity;~~

~~(vi) total shareholder return;~~

~~(vii) growth in net income, revenue, cash flow or operating profit; and/or~~

~~(viii) productivity improvement.~~

~~“Regulations”~~~~mean the Treasury Regulations promulgated under the Code, as amended from time to time.~~

~~“Subsidiary”~~~~means a corporation, partnership, joint venture, unincorporated association or other entity in which the Corporation has a direct or indirect ownership or other equity interest.~~

3. ~~Administration of the Plan.~~The Plan shall be administered by the Committee, which shall have full power and authority to construe, interpret and administer the Plan and shall have the exclusive right to establish Management Objectives and the amount of Incentive Bonus payable to each Eligible Executive upon the achievement of the specified Management Objectives.

4. ~~Eligibility.~~~~Eligibility under this Plan is limited to Eligible Executives designated by the Committee in its sole and absolute discretion.~~

~~Exhibit A - 1~~

~~Exhibit A~~

5. ~~Awards.~~

(a) Not later than the 90th day of each fiscal year of the Corporation, the Committee shall establish the Management Objectives for each Eligible Executive and the amount of Incentive Bonus payable (or formula for determining such amount) upon full achievement of the specified Management Objectives. The Committee may further specify in respect of the specified Management Objectives a minimum acceptable level of achievement below which no Incentive Bonus payment will be made and shall set forth a formula for determining the amount of any payment to be made if performance is at or above the minimum acceptable level but falls short of full achievement of the specified Management Objectives. The Committee may not modify any terms of awards established pursuant to this section, (other than in connection with an Eligible Executive’s death or disability, or a change in control), except to the extent that after such modification the Incentive Bonus would continue to constitute qualified “performance-based compensation” for purposes of Section 162(m) of the Code.

~~(b) The Committee retains the discretion to reduce the amount of any Incentive Bonus that would be otherwise payable to an Eligible Executive (including a reduction in such amount to zero).~~

~~(c) Notwithstanding any other provision of the Plan to the contrary, in no event shall the Incentive Bonus paid to an Eligible Executive under the Plan for a year exceed $2.75 million.~~

6. ~~Committee Certification.~~As soon as reasonably practicable after the end of each fiscal year of the Corporation, the Committee shall determine whether the Management Objective has been achieved and the amount of the Incentive Bonus to be paid to each Eligible Executive for such fiscal year and shall certify such determinations in writing.

7. ~~Payment of Incentive Bonuses~~. Subject to a valid election made by an Eligible Executive with respect to the deferral of all or a portion of his or her Incentive Bonus, Incentive Bonuses shall be paid within 30 days after written certification pursuant to Section 6, but in no event later than two and a half months from the end of the Corporation’s fiscal year. An election to defer payment of all or any part of a bonus under the Plan shall be made in accordance with such rules as may be established by the Committee in order to comply with Section 409A of the Code and such other requirements as the Committee shall deem applicable to the deferral.

8. ~~No Right to Bonus or Continued Employment.~~Neither the establishment of the Plan, the provision for or payment of any amounts hereunder nor any action of the Corporation, the Board or the Committee with respect to the Plan shall be held or construed to confer upon any person (a) any legal right to receive, or any interest in, an Incentive Bonus or any other benefit under the Plan or (b) any legal right to continue to serve as an officer or employee of the Corporation or any Subsidiary of the Corporation.

9. ~~Withholding.~~The Corporation shall have the right to withhold, or require an Eligible Executive to remit to the Corporation, an amount sufficient to satisfy any applicable federal, state, local or foreign withholding tax requirements imposed with respect to the payment of any Incentive Bonus.

~~10.~~ ~~Nontransferability.~~~~Except as expressly provided by the Committee, the rights and benefits under the Plan shall not be transferable or assignable other than by will or the laws of descent and distribution.~~

~~11.~~ ~~Amendment and Termination~~. The Committee may amend the plan from time to time, provided that any such amendment is subject to approval by the shareholders of the Corporation to the extent required to satisfy the requirements of Section 162(m) of the Code and the Regulations promulgated thereunder and provided further that any such amendment shall not, after the end of the~~90-day~~ period described in Section 5(a) of the Plan, cause the amount payable under an Incentive Bonus to be increased as compared to the amount that would have been paid in accordance with the terms established within such period. The Committee may also terminate the plan, on a prospective basis only, at any time.

~~12.~~ ~~Effective Date.~~Subject to its re-approval by the shareholders, this Plan shall remain effective until the first annual meeting of shareholders held in the 2015 fiscal year, subject to any further stockholder approvals (or re-approvals) mandated for performance-based compensation under Section 162(m) of the Code, and subject to the right of the Board to terminate the Plan, on a prospective basis only, at any time.

~~Exhibit A - 2~~

~~Directions to Sheraton Suites~~
~~1989 Front Street, Cuyahoga Falls, Ohio 44221~~

~~From Akron-Canton Regional Airport~~

Take Interstate 77 North to Route 8 North. Proceed on Route 8 North and take the Broad Boulevard Exit. Turn left onto Broad Boulevard. The hotel is located on the left, at the corner of Front Street and Broad Boulevard.

~~From Youngstown (East)~~

Take Interstate 76 West to Route 8 North. Proceed on Route 8 North and take the Broad Boulevard Exit. Turn left onto Broad Boulevard and turn left again onto Front Street. The hotel is located on the left.

~~From Cleveland Hopkins International Airport~~

Take Route 71 South to the Ohio Turnpike (80 East). Proceed on the Ohio Turnpike to Exit 180 (Route 8 South). Continue on Route 8 South to the Broad Boulevard Exit. Turn right on Broad Boulevard and then turn left on Front Street. The hotel is on the left.

~~From Columbus (West)~~

Take Interstate 71 North to Interstate 76/224 East. Continue for approximately 20 miles to the 277/224 East/Canton Exit. Follow Route 77 to Exit 4B, Akron “Exit Only”. Within one mile follow Exit 125A, Route 8 North. Exit at Broad Boulevard and turn left to the hotel.

Directions to Sheraton Suites

1989 Front Street, Cuyahoga Falls, Ohio 44221

From Akron-Canton Regional Airport

From Youngstown (East)

From Cleveland Hopkins International Airport

From Columbus (West)

Take Interstate 71 North to Interstate 76/224 East. Continue for approximately 20 miles to the 277/224 East/Canton Exit. Follow Route 77 to Exit 4B, Akron “Exit Only.” Within one mile follow Exit 125A, Route 8 North. Exit at Broad Boulevard and turn left to the hotel.

Table of Contents



	VOTE BY INTERNET — - www.proxyvote.com 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. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form.
DIEBOLD, INCORPORATED ~~p??~~^S~~JnY~~^Y~~?nT7~~^RMD 5995 MAYFAIR ROAD PO. BOX 3077 NORTH CANTON, OH 44720-8077	Electronic Delivery of Future PROXY MATERIALS ~~NORTH CANTON OH 44720 8077~~ 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.
	VOTE BY PHONE - 1-800-690-6903 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.
	VOTE BY MAIL 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.



TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:	KEEP THIS PORTION FOR YOUR RECORDS
	DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. ~~DETACH AND RETURN THIS PORTION ONLY~~

For

All

Withhold

All

For All

Except

To withhold authority to vote for any ~~All All Except~~ individual nominee(s), mark “For All ~~The Board of D h~~ Except” and write the number(s) of the ~~irectors recommends tat you~~ nominee(s) on the line below. 1. Election of Directors Nominees 01 Bruce L. Byrnes 02 Mei-Wei Cheng 03 Phillip R. Cox 04 Richard L. Crandall 05 Gale S. Fitzgerald 06 Phillip B. Lassiter 07 John N. Lauer 08 Thomas W. Swidarski 09 Henry D.G. Wallace 10 Alan J. Weber

The Board of Directors recommends you vote FOR each of the following ~~proposal(s):~~ nominees:

1. Election of Directors

Nominees

01 Patrick W. Allender

02 Roberto Artavia

03 Bruce L. Byrnes

04 Phillip R. Cox

05 Richard L. Crandall

06 Gale S. Fitzgerald

07 Robert S. Prather, Jr.

08 Rajesh K. Soin

09 Henry D. G. Wallace

10 Alan J. Weber

The Board of Directors recommends you vote FOR proposals 2. and 3.

For

Against

Abstain

2. To ratify the appointment of KPMG LLP as ~~the Company’s~~our independent ~~auditors~~registered public accounting firm for the year ~~2010. 0 0 0~~2013;

3. To ~~re-approve the Company’s Annual Cash Bonus Plan. 0 0 0~~ approve, on an advisory basis, named executive officer compensation.

NOTE: The Common Shares represented by this proxy will be voted by the Proxy Committee, as recommended by the Board of Directors, unless otherwise specified. The Board of Directors recommends a vote “FOR” these items.

Please sign exactly as your name appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, trustee or guardian, please give your full title as such.

Signature [PLEASE SIGN WITHIN BOX]

Date ~~Signature (Joint Owners)~~

Date

Table of Contents

PLEASE VOTE TODAY

Table of Contents

PLEASE VOTE TODAY

SEE REVERSE SIDE

FOR THREE EASY WAYS TO VOTE!

~~PLEASE VOTE TODAY! SEE REVERSE SIDE FOR THREE EASY WAYS TO VOTE!~~

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Annual Report, Notice & Proxy Statement is/are available ~~atwww.proxyvote.com.~~ at www.proxyvote.com.

DIEBOLD, INCORPORATED

This Proxy is ~~Solicted~~Solicited on Behalf of the Board of Directors

The undersigned hereby appoints ~~Thomas W. Swidarski~~Henry D.G. Wallace and Bradley C. Richardson, and each of them, as the Proxy Committee, with full power of substitution, to represent and to vote all the Common Shares of Diebold, Incorporated held of record by the undersigned on ~~March 1, 2010,~~February 25, 2013, at the annual meeting of shareholders which will be held at the Sheraton Suites, 1989 Front Street, Cuyahoga Falls, Ohio 44221 (directions available in the proxy statement) on April ~~29, 2010~~25, 2013 at 11:30 a.m. EDT, or at any adjournment or postponement thereof, as indicated on the reverse side. This card also constitutes your voting instructions for any and all shares held of record by ~~The~~Wells Fargo Bank, ~~of New York Mellon~~N.A. for the account in the Dividend Reinvestment Plan.

This proxy covers all shares for which the undersigned has the right to give voting instructions to Vanguard Fiduciary Trust Company, Trustee of the DIEBOLD, INCORPORATED 401(K) SAVINGS PLAN #091971 and the DIEBOLD, INCORPORATED 401(K) SAVINGS PLAN FOR PUERTO RICO ASSOCIATES #095760. This proxy, when properly executed, will be voted as directed. If no direction is given to the ~~Trustees~~Trustee by 5:30 p.m. EDT on April ~~26, 2010~~23, 2013 the Trustee will vote your shares held in the Plans.

You are encouraged to specify your choices by marking the appropriate boxes, SEE REVERSE SIDE, but you need not mark any boxes if you wish to vote in accordance with the Board of Directors’ recommendations. The Proxy Committee cannot vote the shares unless you sign and return this Card. In its discretion, the Proxy Committee is authorized to vote upon such other business as may properly come before the meeting.

Continued and to be signed on reverse side



Filed by the Registrant þ
Filed by a Party other than the Registrant o

Check the appropriate box:
o	Preliminary Proxy Statement
o	Confidential, for Use of the Commission Only (as permitted byRule 14a-6(e)(2))
þx	Definitive Proxy Statement
o	Definitive Additional Materials
o	Soliciting Material Pursuant to ~~Section~~ 240.14a-12


þ
Diebold, Incorporated
	(Name of Registrant as Specified In Its Charter)

	(Name of Person(s) Filing Proxy Statement)

Payment of Filing Fee (Check the appropriate box):
x	No fee required.

o	Fee computed on table below per Exchange ActRules 14a-6(i)(1) and0-11.


	47
Payments Made ~~upon~~Upon Retirement		48 44
Payments Made ~~upon~~Upon Death or Disability		48 45
Payments Made ~~upon~~Upon aChange-in-Control or Termination Following aChange-in-Control		49 46
~~Effect~~Effects of Certain Tax Regulations on Payments		50 47
Post-Termination Payments Table		51 48
Report of Audit Committee		52 49
Proposal ~~No.~~ 2: Ratification of Appointment of Independent ~~Auditors~~Registered Public Accounting Firm		53 50
Audit and Non-Audit Fees		53 50
Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent ~~Auditors~~Registered Public Accounting Firm		53 51
~~Equity~~Proposal 3: Advisory Vote on Named Executive Officer Compensation ~~Plan Information~~		54 51
~~Proposal No. 3: Re-approval of~~Shareholders Sharing the ~~Diebold, Incorporated Annual Cash Bonus Plan~~Same Address		54
~~Summary of Terms~~51		54
~~Cash Bonus Plan Benefits~~		55
~~Federal Income Tax Consequences~~		55
~~Householding~~		56
Expenses of Solicitation		56 52
Shareholder Proposals ~~of Shareholders~~		56 52
Other Matters		57
~~Diebold, Incorporated Annual Cash Bonus Plan~~52		~~Exhibit A~~



(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 ActRule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):



o	Fee paid previously with preliminary materials.

o	Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.



3.	To ~~re-approve the Diebold, Incorporated Annual Cash Bonus Plan.~~approve, on an advisory basis, our named executive officer compensation.



General Information	1
Questions and Answers	1
Corporate Governance		2 4
Board Leadership Structure	4
Board Meetings and Executive Sessions	2 4
Board Risk Oversight		2 4
Board Committees and Composition		3 5
Director Independence	7
Related Person Transaction Policy	4 8
Communications with Directors		5 8
Code of Business Ethics ~~Policy~~		6 9
Compensation Committee Interlocks and Insider Participation		6 9
~~2009~~ Director Orientation and Education	9
Compensation of ~~Non-Employee~~ Directors		6 10
~~2009~~2012 Director Compensation		7 11
Director Stock Ownership Guidelines		8 11
Consideration of Director-Nominees		8 12
Shareholder Nominees		8 12
Identifying and Evaluating Nominees for Directors		9 12
Majority Voting Policy		9 12
Board Diversity, Director Qualifications and Corporate Governance Guidelines		9 12
Proposal ~~No.~~ 1: Election of Directors		10 13
Beneficial Ownership of Shares		15 17
Security Ownership of Directors and Management		15 17
Section 16(a) Beneficial Ownership Reporting Compliance		16 18
Compensation Committee Report		16 19
Compensation Discussion and Analysis	19
Our Business and 2012 Highlights	17 19
Our Compensation Strategy	20
2012 Executive Compensation Summary	21
Corporate Governance Standards	21
Consideration of 2012 Say-on-Pay Vote	22
2012 Total Compensation Mix	22
Long-term Incentive Valuations	22
Compensation Decision Process	23
2012 Pay Elements	25
Executive ~~Pay Program Overview~~Stock Ownership Guidelines		17 30
~~2010 Grants to Named Executive Officers~~2013 Compensation Decisions		19 30
~~2009 Average Pay Mix~~		19
~~Market Benchmarking of Executive Pay~~		20
~~Pay Setting Process~~		22
~~Analysis of 2009 Elements of Executive Pay~~		24
~~Perquisites and Other~~ Personal Benefits	30
Employment and Separation Agreements	32
Other Compensation Policies		34
~~Compensation Related Risk~~33		36
Executive Compensation		36 35
~~2009~~2012 Summary Compensation Table		37 35
~~2009~~2012 Grants of Plan-Based Awards		39
~~Narrative Disclosure to 2009 Summary Compensation Table and 2009 Grants of Plan-Based Awards Table~~36		39
Outstanding Equity Awards at ~~2009~~2012 Fiscal Year-End		40 37
~~2009~~2012 Option Exercises and Stock Vested		42 39
~~2009~~2012 Pension and Retirement Benefits		43 39
~~2009~~2012 Non-Qualified Deferred Compensation		45 41
Non-Qualified Deferred Compensation Plans		45 42
Potential Payments upon Termination or Change ofin Control		47 43
Payments Made ~~upon~~Upon Termination	43


	Fees Earned or				All Other
	Paid in Cash¹		Stock Awards²		Compensation³		Total
Name	($)		($)		($)		($)
Louis V. Bockius III		23,000		91,840		962		115,802
Mei-Wei Cheng		26,667		97,020		1,820		125,507
Phillip R. Cox		68,333		91,840		6,578		166,751
Richard L. Crandall		67,000		91,840		6,578		165,418
Gale S. Fitzgerald		70,000		91,840		6,578		168,418
Phillip B. Lassiter		70,000		91,840		6,578		168,418
John N. Lauer		157,000		91,840		8,762		257,602
Eric J. Roorda		67,001		91,840		6,578		165,419
Henry D. G. Wallace		73,000		91,840		8,762		173,602
Alan J. Weber		69,000		91,840		6,578		167,418


	Audit		Board Governance		Compensation		Investment
Name	Committee		Committee		Committee		Committee
Louis V. Bockius III	$	3,000	$	1,667	$	—	$	—
Mei-Wei Cheng		3,750		—		—		—
Phillip R. Cox		—		—		10,333		3,000
Richard L. Crandall		9,000		—		—		3,000
Gale S. Fitzgerald		—		8,000		7,000		—
Phillip B. Lassiter		6,000		5,000		4,000		—
John N. Lauer		—		5,000		7,000		—
Eric J. Roorda		3,000		3,334		4,667		1,000
Henry D. G. Wallace		15,000		—		—		3,000
Alan J. Weber		9,000		—		—		5,000


		Amount and Nature of			Percent of
Title of Class	Name of Beneficial Owner	Beneficial Ownership			Class

Common Shares	GGCP, Inc. et al. One Corporate Center Rye, New York 10580		5,621,965	¹	8.49
Common Shares	Janus Capital Management LLC 151 Detroit Street Denver, Colorado 80206		4,799,120	²	7.20
Common Shares	BlackRock, Inc. 40 East 52^nd Street New York, New York 10022		3,471,353		5.24


	Common Shares			Stock Options
	Beneficially			Exercisable		Deferred		Percent of
Director-Nominees:	Owned			Within 60 Days		Shares¹		Class
Bruce L. Byrnes		—			—		—		—
Mei-Wei Cheng		—			—		3,500		*
Phillip R. Cox		—			9,000		7,200		*
Richard L. Crandall		9,089			21,500		7,200		0.05
Gale S. Fitzgerald		6,089			21,500		7,200		0.04
Phillip B. Lassiter		8,771			21,500		7,200		0.05
John N. Lauer		19,721			18,500		10,577		0.06
Thomas W. Swidarski		102,767	^2,3		263,400		—		0.55
Henry D. G. Wallace		1,000			17,500		9,300		0.03
Alan J. Weber		1,500			9,000		7,200		0.02



(5)	Total fee paid:


(1)	Amount Previously Paid:



(2)	Form, Schedule or Registration Statement ~~No.:~~

	No:


(3)	Filing Party:


			Target
			Payout Under		2010-2012 Performance						2010 Stock						Special One-Time
			2010 Annual		Share Awards						Option Grants						RSUs with
			Cash Bonus		Minimum		Target		Maximum		Stock		Exercise				Performance
	Grant		Plan		Payout		Payout		Payout		Options		Price		2010 RSUs		Hurdles
Name	Date		($)		(#)		(#)		(#)		(#)		($/Sh)		(#)		(#)

Thomas W. Swidarski		2/11/10		800,000		10,625		42,500		85,000		127,500		27.88		20,500		0
Bradley C. Richardson		2/11/10		363,750		1,625		6,500		13,000		25,000		27.88		3,000		5,000
James L.M. Chen		2/11/10		277,007		1,375		5,500		11,000		15,000		27.88		2,500		5,000
George S. Mayes Jr.		2/11/10		257,559		1,375		5,500		11,000		15,000		27.88		2,500		5,000
Charles E. Ducey Jr.		2/11/10		268,132		1,375		5,500		11,000		15,000		27.88		2,500		5,000
Leslie A. Pierce		2/11/10		119,056		687		2,750		5,500		8,000		27.88		1,250		2,000
Kevin J. Krakora		2/11/10		160,000		1,125		4,500		9,000		12,000		27.88		2,000		0


			12/31/08 Market
		2008 Revenue	Capitalization	No. of Employees
2009 Peer Group:	Products/Markets:	($ in Millions):	($ in Millions):	(2008):

Actuant Corp.	Global manufacturing/sales (industrial products)	1,664	1,072	7,500

Affiliated Computer Services, Inc.	Business process outsourcing and information technology	6,160	4,476	65,000

Agilent Technologies Inc.	Bio-analytical and electronic measurement solutions provider	5,774	5,471	19,600

Ametek, Inc.	Global manufacturing/sales (electromechanical devices)	2,531	3,224	11,700

Benchmark Electronics, Inc.	Global electronics manufacturing services	2,590	839	10,522

Brady Corp.	Manufacturing/sales (identification solutions)	1,523	1,262	7,800

Cooper Industries plc	Global manufacturing/sales (electrical products and tools)	6,521	5,066	31,202

Corning Inc.	Global manufacturing/sales (specialty glass and ceramics)	5,948	14,743	27,000

Crane Co.	Global manufacturing/sales (engineered industrial products)	2,604	1,031	12,000

Curtiss-Wright Corp.	Global manufacturing/sales (precision components and systems)	1,830	1,502	8,000

Deluxe Corp.	Provider of personalized printed products to financial institutions	1,469	765	7,172

Donaldson Company, Inc.	Global manufacturing/sales (filtration systems)	2,240	2,592	12,700

Dover Corp.	Global manufacturing/sales (industrial products and components)	7,569	6,122	32,300

Fiserv, Inc.	Information management and electronic commerce systems/services	4,739	5,870	20,000

Flowserve Corp.	Global manufacturing/sales (precision-engineered flow control equip)	4,473	2,874	15,000

FMC Technologies, Inc.	Global technology solutions provider to industrial markets	4,551	2,979	9,800

Goodrich Corp.	Global supplier (aerospace components, systems and services)	7,062	4,557	25,000

Harman International Industries Inc.	Global manufacturing/sales (audio products and electronic systems)	4,113	979	11,694

Harris Corp.	Global communications and information technology provider	5,311	5,039	16,500

Hubbell Inc.	Global manufacturing/sales (electrical and electronic products)	2,704	1,837	13,000

International Game Technology	Global manufacturing/sales (computerized gaming equipment)	2,529	3,504	5,800

Itron, Inc.	Global energy and water products and service provider	1,910	2,197	8,700

Lennox International Inc.	Global manufacturing/sales (HVAC and refrigeration)	3,481	1,788	13,500

ManTech International Corp.	Global technologies/solutions provider for national security programs	1,871	1,918	7,900

Mettler-Toledo International Inc.	Global manufacturing/sales (precision weighing instruments)	1,973	2,259	10,000

Moog Inc.	Global manufacturing/sales (precision motion/fluid controls/systems)	1,903	1,561	8,844

NCR Corp.	Global manufacturing/sales (financial technologies/services)	5,315	2,282	22,400

Pall Corp.	Global manufacturing/sales (filtration/purification products and systems)	2,572	3,356	10,600

Pentair, Inc.	Global diversified industrial manufacturing/sales	3,352	2,335	14,700

PerkinElmer, Inc.	Global health and safety technology solutions provider	1,937	1,643	7,900

Pitney Bowes Inc.	Global mail processing and integrated mail solutions provider	6,262	5,252	35,140

Rockwell Automation	Global industrial automation power, control and information solutions	5,698	4,617	21,000

Rockwell Collins, Inc.	Global design and production of communications and aviation electronics	4,780	6,200	20,300

Roper Industries, Inc.	Global manufacturing/sales (energy systems/industrial imaging products)	2,306	3,894	7,900

Sauer-Danfoss Inc.	Global manufacturing/sales (engineered hydraulic and electronic systems)	2,091	422	9,600

SPX Corp.	Global flow technology products and industrial services provider	5,856	2,206	17,800

Teledyne Technologies Inc.	Global electronic components and communications products provider	1,893	1,598	8,800

Teleflex Inc.	Global manufacturing/sales (single-use medical devices)	2,421	1,990	14,200

The Brink’s Company	Global security and cash management services	3,164	1,231	56,900

The Timken Company	Global manufacturing/sales (engineered steel products)	5,664	1,895	25,662

Thomas & Betts Corp.	Manufacturing/sales (electrical components for industrial construction)	2,474	1,335	10,000

Unisys Corp.	Global design and management of information technology systems	5,233	308	29,000

Varian Medical Systems, Inc.	Global manufacturing/sales (cancer therapy systems and x-ray products)	2,070	4,401	4,900

Waters Corp.	Global manufacturing/sales (analytical instruments)	1,575	3,602	5,033
Removed from peer group in 2009:

Thermo Fisher Scientific Inc.	Global analytical and laboratory products and systems provider	10,498	23,145	34,500



Actuant Corp	Fiserv, Inc.	NCR Corp.
Benchmark Electronics Inc.	Flowserve Corp.	Pitney Bowes Inc.
Brady Corp.	Global Payments Inc.	Rockwell Automation
The Brinks Company	Imation Corp.	Sensata Technologies
Coinstar Inc.	International Game Technology	SPX Corp.
Cooper Industries plc¹	Logitech International SA	The Timken Company
Dover Corp.	Mastercard Inc.	Unisys Corp.
Fidelity National Information Services	Mettler-Toledo International Inc.	The Western Union Company
		Woodward Inc.



Named Executive Officer	Individual Goals	Description
Thomas W. Swidarski	▪ MS/IS Infrastructure	▪ Build out infrastructure to support managed services and Integrated Services® growth.
Bradley C. Richardson	▪ IT/GBS Blueprint Compliance ▪ DRC Process	▪ Execute on financial transformation to support information technology and global business services Blueprint projects, among others. ▪ Continue growth of compliance program consistent with ongoing best practices and continue to enhance the DRC (see “Board Governance Committee Risk Oversight” above for more information on the DRC).
Charles E. Ducey, Jr.	▪ Electronic Security revenue and OP	▪ Achieve established Electronic Security revenue and OP goals.
George S. Mayes, Jr.	▪ Cable Print ▪ Product launches	▪ Execute goals related to our Belgium manufacturing operations. ▪ Execute successful launch of new products.
Frank A. Natoli, Jr.	▪ Next Generation Services ▪ Core solutions	▪ Enhance innovation projects within the company’s Next Generation plan and growth of managed services and Integrated Services. ▪ Achieve SB300 metrics and field reliability goals, as well as execution of priority projects.
Leslie A. Pierce	▪ Support FCF objectives ▪ Audit effectiveness ▪ Support DRC ▪ Reporting initiatives ▪ IT/GBS Blueprint Compliance	▪ Financial statement preparation, reporting and quality review. ▪ Establish and maintain certain audit controls. ▪ Develop and monitor key risk mitigation plans around financial risks. ▪ Increase internal and external financial reporting efficiencies. ▪ Optimize process to centralize Blueprint system, and support Blueprint development.



	Cash Bonus						Weighting
	Opportunity
	(%)						Achievement of			Achievement of			Achievement of							Base
							Company Goals			Key Initiatives			Individual Goals			Total				Salary			Payout
Named Executive Officer:	Thresh.		Target		Max.		(50%)			(30%)			(20%)			(%)				($)			($)
Swidarski		40		100		200		24.8%	+		60.0%	+		38.0%	=		122.8	%	x		750,000	=		921,000
Chen		30		75		150		18.6%	+		22.5%	+		28.5%	=		69.6	%	x		351,754	=		244,821
Krakora		35		90		180		21.9%	+		27.0%	+		32.4%	=		81.3	%	x		320,000	=		260,160


•	~~Provide shareholders and executives a clearer view on the level of ownership required;~~

•	~~Increase the financial flexibility our executives have in meeting those requirements; and~~

•	~~Maintain executives’ commitment to share ownership once ownership targets are achieved.~~


•	Engaging, directly or indirectly, in any activity in competition us, in any product, service or business activity for which he or she had any direct responsibility or direct involvement during the two previous years;

•	~~Soliciting one of our employees to terminate his or her employment;~~

•	~~Unauthorized disclosure of confidential, proprietary or trade secret information obtained during employment with us;~~

•	Failure to promptly disclose and assign any interest in any invention or idea conceived during his or her employment and related to any of our actual or anticipated business, research or development work; and

•	~~Any activity that results in a termination for cause, including gross neglect and any act of dishonesty constituting a felony.~~


							Change in Pension
							Value and Non-
						Non-Equity	qualified Deferred
				Stock	Option	Incentive Plan	Compensation	All Other
		Salary¹	Bonus²	Awards³	Awards⁴	Compensation⁵	Earnings⁶	Compensation⁷	Total
Name and Principal Position	Year	($)	($)	($)	($)	($)	($)	($)	($)
Thomas W. Swidarski	2009	750,000	0	1,158,000	1,177,440	921,000	474,000	114,410	4,594,850
President and Chief Executive	2008	750,000	0	765,900	860,700	1,500,000	658,000	172,587	4,707,187
Officer	2007	687,111	365,913	2,836,200	2,178,300	0	177,000	70,835	6,315,359

Bradley C. Richardson	2009	51,609	60,625	773,518	269,397	0	0	20,856	1,176,005
Executive Vice President and	2008	-	-	-	-	-	-	-	-
Chief Financial Officer ⁸	2007	-	-	-	-	-	-	-	-

James L.M. Chen	2009	340,248	0	173,700	117,744	244,821	0	724,820	1,601,333
Executive Vice President,	2008	328,742	0	344,655	71,725	486,538	0	203,869	1,435,529
International Operations	2007	292,215	117,721	236,350	137,959	0	0	236,864	1,021,109

George S. Mayes, Jr.	2009	329,277	0	173,700	117,744	270,776	0	188,333	1,079,830
Executive Vice President,	2008	300,481	0	153,180	71,725	444,712	0	103,489	1,073,587
Global Operations	2007	-	-	-	-	-	-	-	-

Charles E. Ducey, Jr.	2009	308,706	0	173,700	117,744	233,421	229,000	40,011	1,102,582
Executive Vice President,	2008	-	-	-	-	-	-	-	-
North America Operations	2007	-	-	-	-	-	-	-	-

Leslie A. Pierce	2009	305,922	0	81,060	54,947	112,998	42,000	10,698	607,625
Former Interim Chief	2008	-	-	-	-	-	-	-	-
Financial Officer ⁹	2007	-	-	-	-	-	-	-	-

Kevin J. Krakora	2009	353,720	0	289,500	196,240	260,160	189,000	40,718	1,329,338
Former Chief Financial	2008	377,805	0	319,125	179,313	680,049	254,000	77,167	1,887,459
Officer ¹⁰	2007	375,354	0	590,875	363,050	0	127,000	38,668	1,494,947


	All Other Compensation
Names	(a)		(b)		(c)		(d)		(e)		(f)		(g)
Thomas W. Swidarski		23,400		22,664		2,346		6,900		15,000		41,600		2,500
Bradley C. Richardson		2,961		0		0		14,145		0		0		3,750
James L.M. Chen		26,052		0		0		0		0		2,145		696,623
George S. Mayes, Jr.		14,256		0		1,108		156,622		9,167		4,680		2,500
Charles E. Ducey, Jr.		14,256		0		1,075		7,500		10,000		4,680		2,500
Leslie A. Pierce		0		0		480		7,350		0		368		2,500
Kevin J. Krakora		11,750		0		1,427		7,500		9,741		7,800		2,500


								All Other Stock	All Other Option		Grant Date Fair
								Awards: Number	Awards: Number of	Exercise or Base	Value of Stock
		Estimated Possible Payouts Under Non-						of Shares of Stock	Securities Underlying	Price of Option	and Option
		Equity Incentive Plan Awards¹			Estimated Future Payouts Under Equity Incentive Plan Awards²			or Units³	Options⁴	Awards	Awards⁵
Name	Grant Date	Thresh. ($)	Target ($)	Max. ($)	Thresh. (#)	Target (#)	Max. (#)	(#)	(#)	($/Sh)	($)

Thomas W. Swidarski	2/11/2009	-	-	-	-	-	-	-	150,000	24.79	1,177,440
	3/26/2009	-	-	-	12,500	50,000	100,000	-	-	-	1,158,000
	2/11/2009	300,000	750,000	1,500,000	-	-	-	-	-	-	-
Bradley C. Richardson	11/23/2009	-	-	-	-	-	-	-	30,000	26.43	269,397
	11/23/2009	-	-	-	-	-	-	23,850	-	-	630,356
	11/23/2009	-	-	-	1,406	5,625	11,250	-	-	-	148,669
	11/23/2009	12,125	30,313	60,625	-	-	-	-	-	-	-
James L.M. Chen	2/11/2009	-	-	-	-	-	-	-	15,000	24.79	117,744
	3/26/2009	-	-	-	1,875	7,500	15,000	-	-	-	173,700
	2/11/2009	64,873	170,124	324,363	-	-	-	-	-	-	-
George S. Mayes, Jr.	2/11/2009	-	-	-	-	-	-	-	15,000	24.79	117,744
	3/26/2009	-	-	-	1,875	7,500	15,000	-	-	-	173,700
	2/11/2009	68,050	164,639	340,248	-	-	-	-	-	-	-
Charles E. Ducey, Jr.	2/11/2009	-	-	-	-	-	-	-	15,000	24.79	117,744
	3/26/2009	-	-	-	1,875	7,500	15,000	-	-	-	173,700
	2/11/2009	65,855	154,353	329,277	-	-	-	-	-	-	-
Leslie A. Pierce	2/11/2009	-	-	-	-	-	-	-	7,000	24.79	54,947
	3/26/2009	-	-	-	875	3,500	7,000	-	-	-	81,060
	2/11/2009	61,184	152,961	305,922	-	-	-	-	-	-	-
Kevin J. Krakora	2/11/2009	-	-	-	-	-	-	-	25,000	24.79	196,240
	3/26/2009	-	-	-	3,125	12,500	25,000	-	-	-	289,500
	2/11/2009	113,342	340,025	680,049	-	-	-	-	-	-	-


	Option Awards¹						Stock Awards
				Equity Incentive				Market
				Plan Awards:			Number	Value of
		Number of Securities		Number of			of Shares	Shares or	Equity Incentive Plan Awards:
		Underlying Unexercised		Securities			or Units	Units of	Number of	Market or Payout
		Options		Underlying			of Stock	Stock	Unearned Shares,	Value of Unearned
				Unexercised	Option		That	That	Units or Other	Shares, Units or
				Unearned	Exercise	Option	Have Not	Have Not	Rights That Have	Other Rights That
	Grant Date	Exercisable	Unexercisable	Options	Price	Expiration	Vested²	Vested³	Not Vested⁴	Have Not Vested³
Name	of Award	(#)	(#)	(#)	($)	Date	(#)	($)	(#)	($)

Thomas W. Swidarski	2/7/01	8,000	-	-	28.69	2/6/11	-	-	-	-
	2/6/02	15,000	-	-	36.59	2/5/12	-	-	-	-
	2/5/03	20,000	-	-	36.31	2/4/13	-	-	-	-
	2/11/04	25,000	-	-	53.10	2/10/14	-	-	-	-
	2/10/05	22,900	-	-	55.23	2/9/15	-	-	-	-
	12/12/05	75,000	75,000	-	37.87	12/11/12	-	-	-	-
	2/13/08	30,000	90,000	-	25.53	2/12/18	-	-	-	-
	2/11/09	-	150,000	-	24.79	2/10/19	-	-	-	-
	2/14/07	-	-	-	-	-	40,000	1,138,000	-	-
	2/14/07	-	-	-	-	-	-	-	20,000	569,000
	2/13/08	-	-	-	-	-	-	-	60,000	1,707,000
	3/26/09	-	-	-	-	-	-	-	50,000	1,422,500
Bradley C. Richardson	11/23/09	-	30,000	-	26.43	11/22/19	-	-	-	-
	11/23/09	-	-	-	-	-	23,850	678,533	-	-
	11/23/09	-	-	-	-	-	-	-	5,625	160,031
James L.M. Chen	2/6/02	5,000	-	-	36.59	2/5/12	-	-	-	-
	2/5/03	7,500	-	-	36.31	2/4/13	-	-	-	-
	2/11/04	8,000	-	-	53.10	2/10/14	-	-	-	-
	2/10/05	8,000	-	-	55.23	2/9/15	-	-	-	-
	2/20/06	6,000	2,000	-	39.43	2/19/16	-	-	-	-
	2/14/07	4,750	4,750	-	47.27	2/13/17	-	-	-	-
	2/13/08	2,500	7,500	-	25.53	2/12/18	-	-	-	-
	2/11/09	-	15,000	-	24.79	2/10/19	-	-	-	-
	2/20/06	-	-	-	-	-	750	21,338	-	-
	2/13/08	-	-	-	-	-	7,500	213,375	-	-
	2/14/07	-	-	-	-	-	-	-	5,000	142,250
	2/13/08	-	-	-	-	-	-	-	12,000	341,400
	3/26/09	-	-	-	-	-	-	-	7,500	213,375
George S. Mayes Jr.	2/10/05	3,000	-	-	55.23	2/9/15	-	-	-	-
	2/20/06	6,000	2,000	-	39.43	2/19/16	-	-	-	-
	2/14/07	4,750	4,750	-	47.27	2/13/17	-	-	-	-
	2/13/08	2,500	7,500	-	25.53	2/12/18	-	-	-	-
	2/11/09	-	15,000	-	24.79	2/10/19	-	-	-	-
	2/20/06	-	-	-	-	-	4,500	128,025	-	-
	2/14/07	-	-	-	-	-	-	-	5,000	142,250
	2/13/08	-	-	-	-	-	-	-	12,000	341,400
	3/26/09	-	-	-	-	-	-	-	7,500	213,375
Charles E. Ducey Jr.	2/7/01	5,000	-	-	28.69	2/6/11	-	-	-	-
	2/6/02	6,400	-	-	36.59	2/5/12	-	-	-	-
	2/5/03	8,000	-	-	36.31	2/4/13	-	-	-	-
	2/11/04	5,000	-	-	53.10	2/10/14	-	-	-	-
	2/10/05	4,600	-	-	55.23	2/9/15	-	-	-	-
	2/20/06	7,500	2,500	-	39.43	2/19/16	-	-	-	-
	2/14/07	4,750	4,750	-	47.27	2/13/17	-	-	-	-
	2/13/08	2,500	7,500	-	25.53	2/12/18	-	-	-	-
	2/11/09	-	15,000		24.79	2/10/19	-	-	-	-
	2/20/06	-	-	-	-	-	4,500	128,025	-	-
	2/14/07	-	-	-	-	-	-	-	5,000	142,250
	2/13/08	-	-	-	-	-	-	-	12,000	341,400
	3/26/09	-	-	-	-	-	-	-	7,500	213,375
Leslie A. Pierce	2/7/01	600	-	-	28.69	2/6/11	-	-	-	-
	2/6/02	600	-	-	36.59	2/5/12	-	-	-	-
	2/5/03	600	-	-	36.31	2/4/13	-	-	-	-
	2/14/07	625	625	-	47.27	2/13/17	-	-	-	-
	2/13/08	1,250	3,750	-	25.53	2/12/18	-	-	-	-
	2/11/09	-	7,000	-	24.79	2/10/19	-	-	-	-
	2/14/07	-	-	-	-	-	285	8,108	-	-
	2/13/08	-	-	-	-	-	-	-	7,000	199,150
	3/26/09	-	-	-	-	-	-	-	3,500	99,575
Kevin J. Krakora	9/18/01	5,000	-	-	35.60	9/17/11	-	-	-	-
	2/6/02	10,000	-	-	36.59	2/5/12	-	-	-	-
	2/5/03	10,000	-	-	36.31	2/4/13	-	-	-	-
	2/11/04	7,000	-	-	53.10	2/10/14	-	-	-	-
	2/10/05	6,500	-	-	55.23	2/9/15	-	-	-	-
	2/20/06	18,750	6,250	-	39.43	2/19/16	-	-	-	-
	2/14/07	12,500	12,500	-	47.27	2/13/17	-	-	-	-
	2/13/08	5,000	15,000	-	25.53	2/12/18	-	-	-	-
	2/11/09	-	25,000		24.79	2/10/19	-	-	-	-
	2/20/06	-	-	-	-	-	7,500	213,375	-	-
	2/14/07	-	-	-	-	-	-	-	10,000	284,500
	2/13/08	-	-	-	-	-	-	-	20,000	569,000
	3/26/09	-	-	-	-	-	-	-	12,500	355,625


	Option Awards				Stock Awards
	Number of Shares		Value		Number of Shares		Value
	Acquired on		Realized on		Acquired		Realized on
	Exercise		Exercise¹		on Vesting		Vesting²
Name	(#)		($)		(#)		($)
Thomas W. Swidarski		1,500	$	6,675		12,597	$	312,280
Bradley C. Richardson		0		0		0		0
James L.M. Chen		0		0		4,845		120,108
George S. Mayes Jr.		0		0		3,309		82,030
Charles E. Ducey Jr.		1,300		9,521		3,081		76,378
Leslie A. Pierce		0		0		302		10,716
Kevin J. Krakora		0		0		6,276		155,582


		Number of Years of		Present Value of		Payment During
		Credited Service		Accumulated Benefit¹		Last Fiscal Year
Name	Plan Name	(#)		($)		($)
Thomas W. Swidarski	Qualified Plan		13.3333	$	166,000		-
	Pension SERP		13.3333		635,000		-
	Pension Restoration SERP		13.3333		621,000		-
Charles E. Ducey Jr.	Qualified Plan		31.1667		395,000		-
	Pension SERP		31.1667		309,000		-
	Pension Restoration SERP		31.1667		364,000		-
Leslie A. Pierce	Qualified Plan		19.0000		119,000		-
Kevin J. Krakora	Qualified Plan		8.2500		109,000		-
	Pension SERP		8.2500		356,000		-
	Pension Restoration SERP		8.2500		154,000		-


			1992 Deferred Compensation Plan
	Executive		Registrant				Aggregate		Aggregate Balance
	Contributions in		Contributions in		Aggregate Earnings		Withdrawals/		as of December 31,
	2009		2009		in 2009¹		Distributions		2009²
Name	($)		($)		($)		($)		($)
Thomas W. Swidarski		—		—		—		—		—
Bradley C. Richardson		—		—		—		—		—
James L.M. Chen		—		—		—		—		—
George S. Mayes Jr.		—		—		—		—		—
Charles E. Ducey Jr.		0		0		1,863		0		36,969
Leslie A. Pierce		—		—		—		—		—
Kevin J. Krakora		—		—		—		—		—


																	Change in
				Involuntary		Involuntary									Change in		Control w/
Name	Compensation Components	Voluntary		with Cause		w/o Cause		Retirement		Death		Disability			Control		Termination
Thomas W. Swidarski	Salary/Bonus	$	—	$	—		3,921,000	$	—		921,000		921,000		$	—		2,250,000
	Accelerated Long-Term Incentives:
	Stock options		—		—		811,800		—		811,800		811,800			811,800		811,800
	Performance shares ¹		—		—		2,181,167		2,181,167		2,181,167		2,181,167			3,698,500		3,698,500
	RSUs		—		—		—		—		1,138,000		1,138,000			1,138,000		1,138,000
	Retirement Benefits:
	Qualified Retirement Plan/SERP ²		1,723,608		409,603		1,723,608		301,608		1,351,608		1,723,608			—		1,983,388
	Other Benefits ³		—		—		24,488		—		—		1,410,732	⁶		—		59,890
	280G Excise Tax and Gross-up ⁴		—		—		—		—		—		—			—		4,936,917

	Total:		1,723,608		409,603		8,662,063		2,482,775		6,403,575		8,186,307			5,648,300		14,878,495
Bradley C Richardson	Salary/Bonus		—		—		40,417		—		—		—			—		970,000
	Accelerated Long-Term Incentives:
	Stock options		—		—		—		—		66,600		66,600			66,600		66,600
	Performance shares ¹		—		—		—		51,371		51,371		51,371			154,114		154,114
	RSUs		—		—		—		—		678,533		678,533			678,533		678,533
	Retirement Benefits:
	Qualified Retirement Plan/SERP ²		—		—		—		—		—		—			—		58,638
	Other Benefits ³		—		—		—		—		—		—			—		17,106
	280G Excise Tax and Gross-up ⁴		—		—		—		—		—		—			—		1,082,642

	Total:		0		0		40,417		51,371		796,504		796,504			899,247		3,027,633
James L.M. Chen	Salary/Bonus		—		—		293,128		—		—		—			—		703,508
	Accelerated Long-Term Incentives:
	Stock options		—		—		—		—		76,800		76,800			76,800		76,800
	Performance shares ¹		—		—		—		440,975		440,975		440,975			697,025		697,025
	RSUs		—		—		—		—		234,713		234,713			234,713		234,713
	Other Benefits		—		—		—		—		—		—			—		740,955

	Total:		0		0		293,128		440,975		752,488		752,488			1,008,538		2,453,001
George S. Mayes, Jr.	Salary/Bonus		—		—		83,759		—		—		—			—		670,072
	Accelerated Long-Term Incentives:
	Stock options		—		—		—		—		76,800		76,800			76,800		76,800
	Performance shares ¹		—		—		—		440,975		440,975		440,975			697,025		697,025
	RSUs		—		—		—		—		128,025		128,025			128,025		128,025
	Retirement Benefits:
	Qualified Retirement Plan/SERP ²		80,387		62,288		80,387		80,387		80,387		80,387			—		344,691
	Other Benefits ³		—		—		—		—		—		—			—		191,126
	280G Excise Tax and Gross-up ⁴		—		—		—		—		—		—			—		912,795

	Total:		80,387		62,288		164,146		521,362		726,187		726,187			901,850		3,020,534
Charles E. Ducey, Jr.	Salary/Bonus		—		—		162,504		—		—		—			—		650,016
	Accelerated Long-Term Incentives:
	Stock options		—		—		—		—		76,800		76,800			76,800		76,800
	Performance shares ¹		—		—		—		440,975		440,975		440,975			697,025		697,025
	RSUs		—		—		—		—		128,025		128,025			128,025		128,025
	Retirement Benefits:
	Qualified Retirement Plan/SERP ²		1,143,677		459,199		1,143,677		470,677		775,677		2,698,677			—		1,217,080
	Deferred Compensation Plan ⁵		36,969		36,969		36,969		36,969		36,969		36,969			—		36,969
	Other Benefits ³		—		—		—		—		—		—			—		42,793
	280G Excise Tax and Gross-up ⁴		—		—		—		—		—		—			—		2,848,708

	Total:		1,180,646		496,168		1,343,140		948,621		1,458,446		3,381,446			901,850		5,697,416
Leslie A. Pierce	Salary/Bonus		—		—		96,323		—		—		—			—		462,352
	Accelerated Long-Term Incentives:
	Stock options		—		—		—		—		36,570		36,570			36,570		36,570
	Performance shares ¹		—		—		—		165,959		165,959		165,959			298,725		298,725
	RSUs		—		—		—		—		8,108		8,108			8,108		8,108
	Retirement Benefits:
	Qualified Retirement Plan/SERP ²		119,000		119,000		119,000		—		50,000		498,000			—		119,000
	Other Benefits ³		—		—		—		—		—		—			—		16,937
	280G Excise Tax and Gross-up ⁴		—		—		—		—		—		—			—		399,172

	Total:		119,000		119,000		215,323		165,959		260,637		708,637			343,403		1,340,864
Kevin J. Krakora	Salary/Bonus		—		—		80,000		—		—		—			—		640,000
	Accelerated Long-Term Incentives:
	Stock options		—		—		—		—		135,300		135,300			135,300		135,300
	Performance shares ¹		—		—		—		782,375		782,375		782,375			1,209,125		1,209,125
	RSUs		—		—		—		—		213,375		213,375			213,375		213,375
	Retirement Benefits:
	Qualified Retirement Plan/SERP		284,115		123,690		284,115		22,115		159,115		284,115			—		766,170
	Other Benefits ³		—		—		—		—		—		—			—		41,158
	280G Excise Tax and Gross-up ⁴		—		—		—		—		—		—			—		1,330,606

	Total:		284,115		123,690		364,115		804,490		1,290,165		1,415,165			1,557,800		4,335,734