UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant ☒
Filed by a Partyparty other than the Registrant ☐
Check the appropriate box:
☐ | Preliminary Proxy Statement |
☐ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
☒ | Definitive Proxy Statement |
☐ | Definitive Additional Materials |
☐ | Soliciting Material |
WORTHINGTON INDUSTRIES, INC.
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate all boxes that applybox)):
☒ | No fee |
|
|
|
|
|
|
|
|
|
|
|
|
☐ | Fee paid previously with preliminary materials |
☐ |
|
|
|
|
|
|
|
|
|
|
Dear Fellow Shareholders:
On behalf of the Board of Directors and employees of Worthington Industries, Inc. (the “Company”(“we”, “our” and “us”), I cordially invite you to participate via live webcast in the 2019our 2022 Annual Meeting of Shareholders (the “Annual Meeting”) of the Company to be held on Wednesday, September 25, 2019,28, 2022, beginning at 3:00 p.m., Eastern Daylight Time. This year’s Annual Meeting will be a virtual meeting of shareholders which means that you will be able to participate in the Annual Meeting, vote and submit your questions during the Annual Meeting via live webcast by visiting www.virtualshareholdermeeting.com/WOR19.WOR2022. You will not be able to attend the Annual Meeting in person.
Details of the business to be conducted at the Annual Meeting are provided in the accompanying Notice of Annual Meeting of Shareholders and Proxy Statement, which you are urged to read carefully. If you are a registered shareholder participating in the Annual Meeting via the live webcast at www.virtualshareholdermeeting.com/WOR19WOR2022, you may revoke your proxy and vote during the Annual Meeting, even if you have previously submitted a proxy.
We have elected to take advantage of Securities and Exchange Commission (“SEC”) rules that allow us to furnish proxy materials to certain shareholders on the Internet. On or about the date of this letter, we began mailing a Notice of Internet Availability of Proxy Materials (the “Notice”“Notice of Availability”) to shareholders of record at the close of business on August 1, 2019.2022. At the same time, we provided those shareholders with access to our online proxy materials and filed our proxy materials with the SEC. We believe furnishing proxy materials to our shareholders on the Internet will allow us to provide our shareholders with the information they need, while lowering the costs of delivery and reducing the environmental impact of the Annual Meeting. If you have received the Notice of Availability, you will not receive a printed copy of the proxy materials unless you request it by following the instructions for requesting such materials contained in the Notice.Notice of Availability.
It is important that your common shares be represented at the Annual Meeting whether or not you are personally able to participate via the live webcast. Accordingly, after reading the accompanying proxy materials, please promptly submit your proxy by telephone, Internet, mobile device or mail as described in the Proxy Statement or the Notice.Notice of Availability.
Your continuing interest in our Companycompany is greatly appreciated.
Sincerely,
JOHN P. McCONNELL
Chairman of the Board and Chief Executive OfficerChairman
August 14, 201915, 2022
Notice of Annual Meeting of Shareholders to be Held September 25, 201928, 2022
Notice is hereby given that the 20192022 Annual Meeting of Shareholders (the “Annual Meeting”) of Worthington Industries, Inc. (the “Company”(“we”, “our” and “us”) will be held at 3:00 p.m., Eastern Daylight Time, on Wednesday, September 25, 2019. This year’s28, 2022. The Annual Meeting will be a virtual meeting of shareholders which meansheld virtually, meaning that you will be able to participate in the Annual Meeting, vote and submit your questions during the Annual Meeting via live webcast by visiting www.virtualshareholdermeeting.com/WOR19WOR2022. You will not be able to attend the Annual Meeting in person.
The Annual Meeting is being held for the following purposes:
(1) | To elect four directors, each to serve for a term of three years to expire at |
(2) | To approve the advisory resolution |
(3) |
|
| To ratify the selection of KPMG LLP as |
(4) | To transact such other business as may properly come before the Annual Meeting. |
Only shareholders of record at the close of business on the record date, August 1, 2019,2022, are entitled to notice of, and to vote at, the Annual Meeting.
We began mailing a Notice of Internet Availability of Proxy Materials (the “Notice”“Notice of Availability”) on or about August 14, 201915, 2022 to shareholders of record at the close of business on August 1, 2019.2022. The Notice of Availability contains instructions on how to access on the Internet our letter to shareholders, this Notice of Annual Meeting of Shareholders, our 2022 Proxy Statement, our 20192022 Annual Report to Shareholders and the form of proxy, on the Internet, as well as instructions on how to request a paper copy of the proxy materials.
By Order of the Board of Directors,
|
|
|
|
Secretary |
|
|
|
|
|
|
|
Columbus, Ohio |
|
| August |
Before you vote, access the proxy materials in one of the following ways prior to the Annual Meeting: To view
To receive a PAPER or E-MAIL copy: You must request a paper or e-mail copy of the proxy materials. There is
|
| |||||
| By Internet: www.proxyvote.com |
| By Telephone: 1-800-579-1639 |
| By E-Mail*: sendmaterial@proxyvote.com |
|
| *If you request proxy materials by e-mail, please send a blank e-mail including in the subject line the information that is printed in the box |
|
WORTHINGTON INDUSTRIES, INC.
200 Old Wilson Bridge Road
Columbus, Ohio 43085
(614) 438-3210
www.worthingtonindustries.com
2022 PROXY STATEMENT
Dated: August 15, 2022
FOR THE ANNUAL MEETING OF SHAREHOLDERS
To Be Held On September 28, 2022
| Page | |
|
| |
| 1 | |
|
|
|
| 7 | |
|
|
|
Security Ownership of Certain Beneficial Owners and Management |
| 11 |
|
|
|
| 14 | |
|
|
|
|
| |
|
|
|
|
| |
|
|
|
|
| |
|
|
|
|
| |
|
|
|
|
| |
|
|
|
|
| |
|
|
|
|
| |
|
|
|
|
| |
|
|
|
|
| |
|
|
|
|
| |
|
|
|
Annual Cash Incentive Bonus Awards Granted |
|
|
|
|
|
|
| |
65 |
| Page | |
|
| |
|
| |
|
|
|
|
| |
|
|
|
Proposal 2: Advisory Vote to Approve |
|
|
|
|
|
| ||
|
|
|
|
|
|
|
| |
|
|
|
|
| |
| 78 | |
|
| |
|
|
|
Future Electronic Access to Proxy Materials and Annual Report |
|
|
|
|
|
|
| |
80 | ||
|
|
|
|
| |
|
|
|
|
| |
|
|
|
II-1
Proxy StatementStatement Summary
This summary highlights information about Worthington Industries, Inc., an Ohio corporation, and, where appropriate, its subsidiaries (“Worthington”we”, our”, “us” or the “Company”) and certain information contained elsewhere in this 2022 Proxy Statement (this “Proxy Statement”) for the Company’s Annual Meetingour annual meeting of Shareholders (the “Annual Meeting”), which willshareholders to be held on Wednesday, September 25, 2019,28, 2022, beginning at 3:00 p.m., Eastern Daylight Time (EDT) (the “Annual Meeting”). This summary does not contain all of the information that you should consider in voting yourthe common shares, no par value, of the Company (the “common shares”) that you hold, and you should read the entire Proxy Statement carefully before voting. For more complete information regarding the Company’sour performance for the fiscal year ended May 31, 20192022 (“Fiscal 2019”2022”), please review the Company’sour Annual Report on Form 10-K for Fiscal 2019.2022 (the “2022 Form 10-K”) filed with the United States (“U.S.”) Securities and Exchange Commission (the “SEC”) on August 1, 2022. Other than the common shares, we do not have any outstanding voting securities.
Virtual Meeting: The Annual Meeting will be a virtual meeting, which means that you will be able to participate in the Annual Meeting, vote and submit your questions during the Annual Meeting via live webcast, by visiting www.virtualshareholdermeeting.com/WOR19WOR2022. You will not be able to attend the Annual Meeting in person.
|
Even if you plan to |
| ||||||||
| Internet |
| Telephone |
|
| Mobile Device | ||||
|
Go to |
| Call 1-800-690-6903: You can use |
| If you received a printed copy of the may submit your your proxy card and returning it
|
| You can view the proxy materials and vote by scanning the QR barcode on your proxy card or Notice of Internet Availability of Proxy Materials. | |||
|
|
|
|
|
|
|
Voting Matters and Board Recommendations
Our Board of Directors (“Board”) recommends that shareholders entitled to vote at the Annual Meeting vote as follows:
Board Vote Recommendation | Page Reference (for more detail) | ||
Proposal 1: | Election of four directors, each to serve for a term of three years to expire at | FOR each nominee of the Board |
|
Proposal 2: | Approval of advisory resolution | FOR |
|
Proposal 3: |
|
|
|
| Ratification of selection of KPMG LLP as | FOR |
|
Proxy Statement Summary • | 1 |
Director Nominees and Continuing Directors
The following table provides summary information about the four director nominees and the seven continuing directors. Additional information about each nominee’s and each continuing director’sindividual’s experience, qualifications, attributes and skills can be found beginning on page 18.in the “Proposal 1: Election of Directors” section in this Proxy Statement.
Name | Age |
Director Since | Occupation | Board Committees (1) | Age |
Director Since | Occupation | Board Committees |
Nominees Standing for Re-Election to the Board at the 2019 Annual Meeting of Shareholders | ||||||||
Nominees Standing for Re-Election to the Board at the 2022 Annual Meeting of Shareholders | Nominees Standing for Re-Election to the Board at the 2022 Annual Meeting of Shareholders | |||||||
Kerrii B. Anderson | 62 | 2010 | Private Investor and Board Advisor; | Audit; Comp | 65 | 2010 | Private Investor and Board Advisor; | Audit; Compensation |
David P. Blom | 65 | 2019 | Former President and | No Committees | 68 | 2019 | Former President and | Nominating and Governance |
John P. McConnell | 65 | 1990 | Chairman of the Board and | Executive* | 68 | 1990 | Executive Chairman, | Executive* |
Mary Schiavo | 63 | 1998 | Member, Motley Rice LLC | Audit; N&G | 66 | 1998 | Attorney, Motley Rice LLC | Audit; Nominating and Governance |
Directors Whose Terms Continue Until the 2020 Annual Meeting of Shareholders | ||||||||
Directors Whose Terms Continue Until the 2023 Annual Meeting of Shareholders | Directors Whose Terms Continue Until the 2023 Annual Meeting of Shareholders | |||||||
Michael J. Endres | 71 | 1999 | Senior Advisor, | Executive; Comp | 74 | 1999 | Senior Advisor, | Executive; Compensation |
Ozey K. Horton, Jr. | 68 | 2011 | Independent Advisor and | Comp; N&G | 72 | 2011 | Independent Advisor and | Compensation; Nominating and Governance |
Peter Karmanos, Jr. | 76 | 1997 | Retired Executive Chairman | Executive; N&G* | 79 | 1997 | Retired Executive Chairman | Executive; Nominating and Governance* |
Carl A. Nelson, Jr. | 74 | 2004 | Independent Business Consultant | Executive; Audit* | 77 | 2004 | Independent Business Consultant | Executive; Audit* |
Directors Whose Terms Continue Until the 2021 Annual Meeting of Shareholders | ||||||||
Directors Whose Terms Continue Until the 2024 Annual Meeting of Shareholders | Directors Whose Terms Continue Until the 2024 Annual Meeting of Shareholders | |||||||
John B. Blystone | 66 | 1997 | Retired Chairman of the | Lead Independent | 69 | 1997 | Retired Chairman of the | Lead Independent |
Mark C. Davis | 59 | 2011 | Private Investor and | Audit | 62 | 2011 | Private Investor and | Audit |
Sidney A. Ribeau | 71 | 2000 | Professor of Communications and | N&G | 75 | 2000 | Professor of Communications and | Nominating and Governance |
|
|
N&G: Nominating and Governance
*Denotes Committee Chair
2 | Worthington | |
Commitment to Shareholders / Governance
Worthington hasWe have long operated under a strong corporate Philosophyphilosophy rooted in the golden ruleGolden Rule with earning money for our shareholders and increasing the value of their investment as the Company’sour first corporate goal. Consistent with this Philosophyphilosophy and the Company’sour culture, Worthington iswe are committed to high ethical standards and sound corporate governance practices.
Strong Corporate Culture | • | Culture based on long-standing corporate |
• | First corporate goal is to earn money for our shareholders and increase the value of their investment | |
• | Comprehensive Corporate Governance Guidelines and Code of Conduct | |
Returns to Shareholders | • | Dividends have been paid every quarter since going public in 1968 |
• | Stock buy-back program | |
Board Independence | • |
|
• | Audit, Compensation, and Nominating and Governance Committees are composed exclusively of directors who are independent under NYSE corporate governance standards and applicable SEC rules | |
Lead Independent Director | • | John Blystone serves as Lead Independent Director |
• | Mr. Blystone serves as liaison between management and the | |
Executive Sessions | • | The |
• | The Lead Independent Director presides at these executive sessions | |
Board Oversight of Risk Management | • | The Board monitors |
• | The Audit Committee reviews our overall enterprise risk management policies and practices, our financial, reporting and compliance risk exposures, and the delegation of risk oversight responsibilities to other Board committees | |
• | The Compensation Committee oversees compensation risk management | |
• | The Nominating and Governance Committee manages risks associated with corporate governance, Board composition and the performance of the Board, its committees and the directors | |
Board Oversight of Corporate Social Responsibility | • | Committed to living our Philosophy, which includes being a good corporate citizen and environmental steward |
• | The Nominating and Governance Committee oversees our corporate social responsibility policies, practices and reporting | |
Executive Compensation | • | Strong pay-for-performance philosophy |
• | Executive compensation is more highly leveraged than market median – base salaries are generally below market median and a higher percentage of pay is tied to at-risk incentive compensation | |
• | Goals and targets for annual and long-term incentive plans are annually reviewed and set by the Compensation Committee | |
• | The Compensation Committee is advised by an independent compensation consultant | |
• | Annual “say-on-pay” advisory vote | |
• | Limited perquisites and benefits | |
• | No defined benefit pension or SERP benefits | |
• | Change | |
• | No employment contracts or change in control arrangements for executive officers outside shareholder-approved incentive plans | |
• | Have never repriced or offered cash buy-outs of underwater stock options as | |
Stock Ownership Requirements | • | Non-management directors to hold |
• | Executive Chairman and CEO to hold | |
• |
| |
• | No speculative trading or hedging permitted by our directors, officers or other key employees |
Proxy Statement Summary • | 3 |
Fiscal 20192022 Business Performance and Executive Compensation Program Highlights
Despite many challenges, Fiscal 2022 proved to be an exceptionally strong year for us. In Fiscal 2019, the Company posted its third best year in termsface of a very tough environment that included supply chain constraints, steel price volatility, a tight labor market and inflationary cost pressures, we delivered stellar results with very strong earnings per diluted common share following(“EPS”). As a result of strong performancesdemand across all of our end markets and contributions from recent acquisitions, we performed well and saw year-over-year improvements in both most of our major businesses. Steel Processing performed well, even with lower inventory holding gains, while Consumer Products saw improvement despite increased labor and material costs. Building Products also experienced significant improvement in performance after a challenging fiscal year ended May 31, 2021 (“Fiscal 20182021”) that was heavily impacted by the effects of COVID-19.
Management has continued to do an outstanding job addressing the lingering supply chain, labor and other challenges presented by COVID-19, which in many cases have been exacerbated by the war in Ukraine and the current inflationary environment, and has shown great discipline in executing our strategies. During Fiscal 2017. It2022, we also continued to generate strong cash flow.
Fiscal 2019 was a solid but challenging year driven largelytake action to better position ourselves for the future. Management remained focused on improving our businesses by investing in new product development and production capacity, and improving efficiencies, all with the steel tariffs enacted in early 2018. Steel Processing was impacted by fluctuating steel prices, particularlyaid of transformation and innovation efforts. We and our M&A team added new businesses through acquisitions focusing on supplying products to the significant declines laterhigh growth electric vehicle and electricity infrastructure markets, as well as lightweighting applications for the automotive industry, all of which should contribute to our growth in the year, which led to inventory holding losses compared to inventory holding gains in Fiscal 2018. Falling steel prices later in the year also created short-term margin pressure and contributed to lower direct shipments in the second half of Fiscal 2019 as customers appeared to delay orders while waiting for prices to drop. The fluctuating steel prices also resulted in lower scrap prices relative to the cost of steel, and this scrap gap had a negative impact on spreads. Pressure Cylinders was also hurt as the increased steel prices and other input costs early in the year reduced margins, but this segment was able to improve pricing and margins as the year went on. In addition, Pressure Cylinders results were negatively impacted by a $13 million charge related to a cylinder replacement program.coming years.
Consistent with the Company’sour compensation philosophy, annual incentive compensation earned by Company participantsour executives continued to move in the direction of the Company’s performance. Annual compensationour results. Due to our very strong performance, annual cash incentive bonuses for Corporateour executives were down,up for Fiscal 2022, with Corporate (i.e., our aggregate performance as opposed to segment or business unit performance) paying out at 93%200% of target, following a payoutpayouts of 106%185% of target for Fiscal 2018. 2021 and only 75% of target for Fiscal 2020.
CorporateThe strong results also had a significant positive impact on long-term performance awards for the three-fiscal-year period ended with Fiscal 2019 were also down significantly, paying2022. These awards paid out at 48%200% of target following a payout of 94%for Corporate, 191% of target for Steel Processing, and 200% for legacy Pressure Cylinders. This followed the three-fiscal-year period ended with Fiscal 2018.
The Company has taken action2021, which had had similar payouts due to betterour strong performance in Fiscal 2021.
Our financial position itselfremains strong, as we generated a considerable amount of cash from operations in recent years. We were able to pay most of the purchase price for the future. It hasacquisitions of Shiloh Industries’ U.S. BlankLight® business and continuesTempel Steel Company (“Tempel”), an aggregate amount of approximately $377.3 million before closing adjustments, from existing cash. Our capital structure is also in a sound position. We have in place $200 million of long-term senior notes due 2032, $250 million of long-term senior notes due 2026, and $150 million of long-term senior notes due 2024. We also have a $500 million revolving credit facility, through August 2026, and a revolving trade accounts receivable securitization facility allowing us to take actionborrow up to exit non-core, underperforming operations. It remains focused on enhancing growth through transformation, innovation$175.0 million. These committed lines of credit had a total of $518.6 million of borrowing capacity available to be drawn as of July 29, 2022.
We have also been able to reward our shareholders by steadily increasing our quarterly dividend from $0.23 for Fiscal 2019, to $0.24 for Fiscal 2020, to $0.25 for the first, second, and acquisition. The Company’s transformation playbook has been refocused intothird quarters of Fiscal 2021, to $0.28 for the fourth quarter of Fiscal 2021 and each quarter of Fiscal 2022, and to $0.31 for the first quarter of Fiscal 2023. In addition, we continued our stock buy-back program in Fiscal 2022, repurchasing a business system that combines standard metrics and performance management, lean tools for optimizing value streams and agile teams to attack recognized opportunities. Multiple innovation teams are working to develop meaningful new products to separate the Company from competitors and deliver impaired results. The Company has increased the size and experiencetotal of its M&A team so that it is ready when the right opportunities arise. 3,235,000 common shares last year.
4 | Worthington | |
Earned Incentive Compensation Levels
The following table lists,shows the percentage of target compensation levels achieved under the annual cash incentive bonus program for eachthe last five fiscal years.
Performance | Payouts as Percentage of Target | |||||||
Corporate | Steel Processing | Legacy Pressure Cylinders (1) | ||||||
2018 | Solid year, with the then second best annual EPS results | 106% | 103% | 104% | ||||
2019 | Then third best annual EPS, but weaker year-over-year results | 93% | 89% | 82% | ||||
2020 | Results were weakened due to the impact of COVID-19 in the fourth quarter | 75% | 63% | 83% | ||||
2021 | Strong year despite COVID-19 related challenges | 185% | 183% | 166% | ||||
2022 | Very strong year despite COVID-19 and other challenges | Corporate | Steel Processing | Consumer Products | Building Products | Sustainable Energy Solutions | ||
200% | 200% | 168% | 189% | 100% |
The following table shows the percentage of Fiscal 2019, Fiscal 2018 and Fiscal 2017,target achieved for awards under the bonus andlong-term incentive compensation earned byprogram for the Company’s Chief Executive Officer (“CEO”), the two individuals who served as the Company’s Chief Financial Officer (“CFO”), and the three other most highly compensated executive officers serving in executive officer positions at the end of Fiscal 2019 (collectively, the current “named executive officers” or current “NEOs”) as well as their total cash bonus awards for those fiscal years and their three-fiscal-year cash performance and performance share awards earned for the periods ended with suchthe last five fiscal years. Information is not included for fiscal years for which the officer was not an NEO. See the “Fiscal 2019 Summary Compensation Table” beginning on page 52 of this Proxy Statement for additional information on compensation of the NEOs, including compensation information for NEOs who were not serving in executive officer positions at the end of Fiscal 2019.
|
|
|
|
|
|
|
|
| 3-Year Performance Share Award Earned |
| |||||
Name and Principal Position During Fiscal 2019 | Fiscal Year | Annual Incentive Bonus Earned ($) | 3-Year Cash Performance Award Earned ($) | (# of Shares) |
| Value on Date Distributed ($)(1) |
| ||||||||
John P. McConnell, | 2019 |
| 877,723 |
|
|
| 484,000 |
|
|
| 7,260 |
|
| 292,505 |
|
Chairman of the Board | 2018 |
| 970,666 |
|
|
| 935,000 |
|
|
| 18,700 |
|
| 801,295 |
|
and Chief Executive Officer | 2017 |
| 1,015,127 |
|
|
| 923,000 |
|
|
| 15,691 |
|
| 788,002 |
|
Joseph B. Hayek, | 2019 |
| 291,287 |
|
|
| 55,909 |
| (2) |
| 501 |
|
| 20,185 |
|
Vice President and | 2018 | N/A |
|
| N/A |
|
| N/A |
| N/A |
| ||||
Chief Financial Officer (3) | 2017 | N/A |
|
| N/A |
|
| N/A |
| N/A |
| ||||
B. Andrew Rose, | 2019 |
| 657,546 |
| (4) |
| 290,400 |
|
|
| 3,630 |
|
| 146,253 |
|
President and Former | 2018 |
| 632,236 |
|
|
| 561,000 |
|
|
| 9,350 |
|
| 400,648 |
|
Chief Financial Officer (5) (6) | 2017 |
| 661,127 |
|
|
| 553,800 |
|
|
| 6,461 |
|
| 324,471 |
|
Geoffrey G. Gilmore, | 2019 |
| 557,265 |
| (4) |
| 161,700 |
| (2) |
| 1,513 |
|
| 60,959 |
|
Executive Vice President and | 2018 |
| 525,672 |
|
|
| 149,600 |
|
|
| 2,493 |
|
| 106,825 |
|
Chief Operating Officer (6) (7) | 2017 |
| 480,000 |
| (8) |
| 143,065 |
|
|
| 1,431 |
|
| 71,865 |
|
Virgil L. Winland, | 2019 |
| 445,896 |
|
|
| 111,320 |
|
|
| 1,271 |
|
| 51,209 |
|
Senior Vice President, | 2018 |
| 493,164 |
|
|
| 215,050 |
|
|
| 3,273 |
|
| 140,248 |
|
Manufacturing | 2017 |
| 515,700 |
|
|
| 212,290 |
|
|
| 1,846 |
|
| 92,706 |
|
Dale T. Brinkman, | 2019 |
| 396,352 |
|
|
| 96,800 |
|
|
| 1,271 |
|
| 51,209 |
|
Senior Vice President-Administration, | 2018 | N/A |
|
| N/A |
|
| N/A |
| N/A |
| ||||
General Counsel and Secretary (9) | 2017 | N/A |
|
| N/A |
|
| N/A |
| N/A |
|
Performance Period (Fiscal Years) | Performance |
Corporate |
Steel Processing |
Legacy Pressure Cylinders (1) |
2016-2018 | Solid year in Fiscal 2018 (then second best reported annual EPS) following two prior then record years, but payouts were below higher target | 94% | 47% | 47% |
2017-2019 | Weaker results in Fiscal 2019 kept payouts below target despite strong years in Fiscal 2018 and Fiscal 2017 | 48% | 24% | 24% |
2018-2020 | COVID-19 weakened results for Fiscal 2020 negatively affected entire period | 0% | 0% | 52% |
2019-2021 | Strong results in Fiscal 2021 lifted results for the entire period | 200% | 173% | 144% |
2020-2022 | Strong results in Fiscal 2021 and Fiscal 2022 lifted results for the entire period | 200% | 191% | 200% |
____________________________
(1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proxy Statement Summary • | 5 |
Overview of Executive Compensation Program
| SHORT-TERM CASH | LONG-TERM INCENTIVE | ||||
PAY ELEMENT |
BASE SALARY | ANNUAL INCENTIVE BONUS (1) | CASH PERFORMANCE | PERFORMANCE SHARES | RESTRICTED COMMON SHARES | STOCK OPTIONS |
WHO RECEIVES | NEOs and other Senior Executives | |||||
AT RISK | ✘ | |||||
FORM OF PAYMENT | Cash | Equity | ||||
TYPE OF PERFORMANCE | Short-term emphasis | Long-term emphasis | ||||
PERFORMANCE PERIOD / VESTING PERIOD
| Ongoing | 1 year |
performance period | 3-year cliff vesting | 3-year incremental vesting (33% a year) | |
HOW PAY-OUT DETERMINED | Set or |
sets targets based on metrics (below) and potential awards. Performance determines amount earned |
determines size of award. Value depends on price of common shares on exercise / vesting date | |||
MOST RECENT PERFORMANCE METRICS (2)
| N/A | EVA (BU or Corp.) EPS (Corp.) | EVA (Corp.)
EPS (Corp.) | Stock Price | Stock Price Appreciation | |
VALUE OF AWARD EARNED | N/A | Formulaic – Performance v Targets | Formulaic – Performance v Targets / Market Price of Common Shares | Market Price x Common Shares | (Market Price – Exercise Price) x Common Shares |
(1) | Discretionary annual bonuses have been awarded from time to time to selected employees or groups of employees at the discretion of the Compensation Committee |
(2) | “BU” means a business unit. “EBIT” means earnings before interest and taxes. “EOI” means adjusted business unit earnings. “EVA” means economic value added. |
6 | Worthington | |
WORTHINGTON INDUSTRIES, INC.
200 Old Wilson Bridge Road
Columbus, Ohio 43085
(614) 438-3210
www.worthingtonindustries.com
PROXY STATEMENT
Dated: August 14, 201915, 2022
FOR THE ANNUAL MEETING OF SHAREHOLDERS
To Be Held On September 25, 201928, 2022
This Proxy Statement is furnished in connection with the solicitation of proxies by the Board of Directors (the “Board”) of Worthington Industries, Inc., an Ohio corporation (the “Company”), for use at the 20192022 Annual Meeting of Shareholders to be held at 3:00 p.m., Eastern Daylight Time, on September 25, 2019 (the “Annual Meeting”).Meeting. The Annual Meeting will be a virtual meeting, which means that you will be able to participate in the Annual Meeting, vote and submit your questions during the Annual Meeting only via live webcast by visiting www.virtualshareholdermeeting.com/WOR19WOR2022. On or about August 14, 2019,15, 2022, we began mailing to our shareholders of record at the close of business on August 1, 2019,2022 (the “Record Date”), a Notice of Internet Availability of Proxy Materials (the “Notice of Availability”) containing instructions on how to access the Notice of Annual Meeting of Shareholders, this Proxy Statement, the form of proxy (often referred to as a “proxy card”) and our 20192022 Annual Report to Shareholders for the fiscal year ended May 31, 2019 (“Fiscal 2019”).
As used in this Proxy Statement, the “Company” means Worthington Industries, Inc. or, where appropriate, Worthington Industries, Inc. and its subsidiaries. The term “common shares” means the Company’s common shares, without par value. Other than the common shares, no voting securities of the Company are outstanding.Report.
Purpose of the Annual Meeting
At the Annual Meeting, shareholders will act upon the matters outlined in the Notice of Annual Meeting of Shareholders included with this Proxy Statement. Specifically, the shareholders will be asked to: (1) elect four directors to the Board for three-year terms to expire at the 2022 Annual Meetingour 2025 annual meeting of Shareholders;shareholders; (2) approve an advisory resolution on the Company’s executive compensation; (3)to approve the Fourth Amendment tocompensation of the Worthington Industries, Inc. AmendedNEOs; and Restated 1997 Long-Term Incentive Plan to authorize 1,500,000 additional common shares; and (4)(3) ratify the selection of KPMG LLP (“KPMG”) as theour independent registered public accounting firm of the Company for the fiscal year ending May 31, 2020 (“Fiscal 2020”). In addition, following the formal portion of the Annual Meeting, management of the Company will respond to questions from shareholders.2023.
Board’s Recommendations
Subject to revocation, all forms of proxy that are properly completed and timely received will be voted in accordance with the instructions contained therein. If no instructions are given (except in the case of broker non-votes), the persons named as proxy holders will vote the common shares in accordance with the recommendations of the Board. The Board’s recommendations are set forth together with the description of each proposal in this Proxy Statement. In summary, the Board recommends a vote:
“FOR” the election of the Board’s nominated slate of directors (see “PROPOSAL“Proposal 1: ELECTION OF DIRECTORS”Election of Directors”);
“FOR” the approval of the advisory resolution on executiveto approve the compensation of the NEOs (see “PROPOSAL“Proposal 2: ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION”Advisory Vote to Approve the Compensation of the NEOs”); and
|
|
“FOR” the ratification of the selection of KPMG LLP as theour independent registered public accounting firm for Fiscal 2023 (see “Proposal 3: Ratification of the Company for Fiscal 2020 (see “PROPOSAL 4: RATIFICATION OF THE SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM”Selection of Independent Registered Public Accounting Firm”).
Shareholder Voting Rights
Only shareholders of record at the close of business on August 1, 20192022 (the “Record Date”) or such shareholders’ proxies are entitled to receive notice of, and to vote at, the Annual Meeting. As of the close of business on the Record Date, there were 56,153,08849,528,843 common shares outstanding and entitled to vote. Each shareholder is entitled to one vote on each matter voted upon at the Annual Meeting for each common share held. Shareholders do not have cumulative voting rights in the election of directors. All voting at the Annual Meeting will be governed by our Amended Articles of Incorporation, our Code of Regulations and the General Corporation Law of the State of Ohio.
General Information • 2022 Proxy Statement | Worthington | 7 |
Registered Shareholders and Beneficial ShareholdersOwners
If ourthe common shares are registered in your name directly with our transfer agent, EQ Shareowner Services,Broadridge Corporate Issuer Solutions, Inc. (“Broadridge”), you are considered, with respect to those common shares, a holder of record (which we also refer to as a “registered shareholder”). If you hold ourthe common shares in a brokerage account or through a bank or other holder of record, you are considered the beneficial holder or beneficial owner of the common shares, which is often referred to as holding the common shares in “street name”.
Voting of Common Shares Held in “Street Name”
A “broker non-vote” occurs when a shareholderbeneficial owner holds ourthe common shares in “street name” through a broker, bank or similar organization,other holder of record who is considered the registered shareholder with respect to the common shares of the beneficial owner, and the shareholderbeneficial owner does not provide the broker, bank or organizationother holder of record with instructions within the required timeframe before the Annual Meeting as to how to vote the common shares on “non-routine” matters. Under the applicable sections of the New York Stock Exchange (“NYSE”(the “NYSE”) Listed Company Manual (the “NYSE(“NYSE Rules”), your broker, bank or other holder of record cannot vote your common shares on non-routine matters unless your brokerit receives instructions from you as to how to vote.
The only proposal which is considered “routine” isProposal 1 (Election of Directors) and Proposal 2 (Advisory Vote to Approve the ratificationCompensation of the selection of the Company’s independent registered public accounting firm. The other proposalsNEOs) are considered “non-routine” matters where your broker, bank or other holder of record can only vote your common shares only if your brokerit receives instructions from you. Proposal 3 (Ratification of the Selection of Independent Registered Public Accounting Firm) is considered a “routine” matter.
Your broker, bank or other holder of record will send you directions on how to instruct your brokerit to vote your common shares. If you want your common shares to be voted on the following matters, you must instruct your broker how to vote: (i) for the election of our director nominees; (ii) for the proposal to approve the advisory resolution on executive compensation; and (iii) for the proposal to approve the Fourth Amendment to the Worthington Industries, Inc. Amended and Restated 1997 Long-Term Incentive Plan to authorize 1,500,000 additional common shares.
Attendance and Participation at the Annual Meeting
We will be hostinghost the Annual Meeting live via the Internet.Internet at www.virtualshareholdermeeting.com/WOR2022. You will not be able to attend the Annual Meeting in person.
Only shareholders of record at the close of business on the Record Date may participate in and vote at the Annual Meeting. Any shareholder canmay listen to and participate in the Annual Meeting live via the Internet at www.virtualshareholdermeeting.com/WOR19.. The webcast will start at 3:00 p.m., Eastern Daylight Time, on September 25, 2019. Shareholders may vote and submit questions while connected to the Annual Meeting on the Internet.28, 2022.
Instructions on how to connect to and participate in the Annual Meeting, including how to demonstrate proof of ownership of ourthe common shares, are posted at www.virtualshareholdermeeting.com/WOR19WOR2022. If you do not have your 16-digit control number that is printed in the box marked by the arrowfound directly after “Control #” provided on your Notice of Internet Availability of Proxy Materials or your proxy card (if you received a printed copy of the proxy materials), you will only be able to listen to the Annual Meeting.
8 | Worthington | |
How to Vote and Voting Deadlines
If you are a registered shareholder, there are several ways for you to vote your common shares:
Vote by Internet.
Before the Date of the Annual Meeting: Go to www.proxyvote.com, or, using a mobile device, scan the QR barcode on your proxy card or Notice of Availability.
You can use the Internet 24 hours a day, seven days a week, to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m., Eastern Daylight Time, on September 24, 2019.27, 2022. Have your proxy card or Notice of Internet Availability of Proxy Materials in hand when you access the website or scan the QR barcode and follow the instructions to obtain your records and create an electronic voting instruction form.
During the Annual Meeting: Go to www.virtualshareholdermeeting.com/WOR19WOR2022
You may attend the Annual Meeting via the Internet and vote during the Annual Meeting. Have the information printedthat is shown in the box marked by the arrowfound directly after “Control #” provided on your proxy card or Notice of Internet Availability of Proxy Materials available and follow the instructions.
Vote By Telephone: Call 1-800-690-6903. You can use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m., Eastern Daylight Time, on September 24, 2019.27, 2022. Have your proxy card or Notice of Internet Availability of Proxy Materials in hand when you call and follow the instructions.
By Mail: If you received a printed copy of the proxy materials, you may submit your vote by completing, signing and dating your proxy card and returning it in the prepaid envelope to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, New York 11717. Sign your name exactly as it appears on the proxy card. Proxy cards submitted by mail must be received by Broadridge no later than September 24, 201927, 2022 to be voted at the Annual Meeting.
If you vote via the Internet (including by using a mobile device to scan the QR barcode on your proxy card or Notice of Availability and following the prompts) or by telephone, your electronic vote authorizes the named proxy holders in the same manner as if you signed, dated and returned your proxy card. If you vote via the Internet or by telephone, do not return your proxy card.
If you are a beneficial owner of ourthe common shares, you should have received a notice that directs you to the website where you can access our proxy materials as well as voting instructions from the broker or other nominee holding yourthe common shares. You should follow the voting instructions provided by your broker or nominee in order to instruct your broker or nominee on how to vote your common shares. Please note that the voting instructions provided by your broker or nominee will have a voting deadline that is earlier than those listed above. The availability of telephone and Internet voting will depend on the voting process of the broker or nominee. Common shares held beneficially may not be voted by the beneficial owner during our Annual Meeting.
How to Revoke or Change Your Vote after Submitting Your Proxy
If you are a registered shareholder, you may revoke or change your vote at any time before the final vote at the Annual Meeting by:
signing and returning a new proxy card with a later date – only your latest completed, signed and dated proxy card received by September 24, 2019,27, 2022, will be counted;
submitting a later-dated vote by telephone or via the Internet (including by using a mobile device to scan the QR barcode on your proxy card or Notice of Availability and following the prompts) – only your latest telephone or Internet voting instructions received by 11:59 p.m., Eastern Daylight Time, on September 24, 2019,27, 2022, will be counted;
participating in the Annual Meeting live via the Internet and voting again;during the Annual Meeting; or
delivering a written revocation to our Secretary at 200 Old Wilson Bridge Road, Columbus, Ohio 43085, to be received no later than September 24, 2019.27, 2022.
If you are a beneficial owner of ourthe common shares, you must contact the broker or other nominee holding your common shares and follow the instructions of the broker or other nominee for revoking or changing your vote.
General Information • 2022 Proxy Statement | Worthington | 9 |
Notice of Internet Availability of Proxy Materials
In accordance with rules adopted by the Securities and Exchange Commission (the “SEC”),SEC, instead of mailing a printed copy of our proxy materials to each shareholder of record, we are permitted to furnish our proxy materials, including the letter to shareholders, Notice of Annual Meeting of Shareholders, this Proxy Statement, and our 20192022 Annual Report to Shareholders,and the form of proxy, by providing access to such documents on the Internet. Generally, shareholders will not receive printed copies of the proxy materials unless they request them.
|
|
A Notice of Internet Availability of Proxy Materials that provides instructions for accessing our proxy materials on the Internet has been mailed directly to registered shareholders. The Notice of Internet Availability of Proxy Materials also provides instructions regarding how registered shareholders may vote their common shares on the Internet. Registered shareholders who prefer to receive a paper or e-mail copy of our proxy materials must follow the instructions provided in the Notice of Internet Availability of Proxy Materials for requesting such proxy materials.
The Notice of Internet Availability of Proxy Materials only identifies the items to be voted on at the Annual Meeting. You cannot vote by marking the Notice of Internet Availability of Proxy Materials and returning it. The Notice of Internet Availability of Proxy Materials provides instructions on how to cast your vote.
A notice that directs beneficial owners of ourthe common shares to the website where they can access our proxy materials should be forwarded to each beneficial owner by the broker, bank or other holder of record who is considered the registered shareholder with respect to the common shares of the beneficial owner. Such broker, bank or other holder of record should also provide each beneficial owner of ourthe common shares with instructions on how the beneficial owner may request a paper or e-mail copy of our proxy materials. Beneficial owners have the right to direct their broker, bank or other holder of record on how to vote their common shares by following the voting instructions they receive from their broker, bank or other holder of record.
To enroll in the electronic delivery service for future shareholder meetings, use your Notice of Internet Availability of Proxy Materials (or proxy card, if you received a printed copy of the proxy materials) to register online at www.proxyvote.com and, when prompted, indicate that you agree to receive or access shareholder communications electronically in future years.
Quorum and Tabulation of Voting Results
Tabulation of the votes cast at the Annual Meeting will be performed by Broadridge Financial Services, and such tabulation will be inspected by the inspector of election appointed by the Board for the Annual Meeting. The presence, in person or by proxy, of the holders of one-third of the outstanding common shares entitled to vote at the Annual Meeting will constitute a quorum, permitting us to conduct our business at the Annual Meeting. If you are a registered shareholder and submit a proxy, your common shares will be counted to determine whether we have a quorum even if you abstain or fail to provide voting instructions on any of the proposals described in this Proxy Statement and listed on the form of proxy. If your common shares are held in the name of your broker or other nominee, and you do not instruct your broker or other nominee how to vote your common shares, these common shares will still be counted for purposes of determining the presence or absence of a quorum for the transaction of business if your broker or other nominee submits a proxy.
Proxy Solicitation Costs
This solicitation of proxies is made by and on behalf of the Board. In addition to mailing the Notice of Internet Availability of Proxy Materials (or, if applicable, paper copies of this Proxy Statement, the Notice of Annual Meeting of Shareholders, the proxy card and our 20192022 Annual Report to Shareholders)Report) to registered shareholders as of the close of business on the Record Date, the brokers, banks and other nominees holding ourthe common shares for beneficial owners must provide a notice as to where they cansuch beneficial owners may access our proxy materials to persons for whom they hold our common shares in order that such common shares may be voted. Solicitation may also be made by our directors, officers and select other Company employees telephonically, electronically or by other means of communication. Directors,Our directors, officers and employees who help us inassist with the solicitation will not be specially compensated for those services, but they may be reimbursed for their out-of-pocket expenses incurred in connection with the solicitation. In addition, the Company haswe have retained Broadridge Financial Solutions to aid in the solicitation of proxies with respect to common shares held by broker/dealers, financial institutions and other custodians, fiduciaries and nominees, for a fee of approximately $17,000, plus out-of-pocket expenses.
The CompanyWe will reimburse Broadridge, Financial Solutions, as well as broker/dealers, financial institutions andbrokers, banks or other custodians, fiduciaries and nominees, who are record holders of common shares not beneficially owned by them,record, for their reasonable costs in sending proxy materials to the beneficial owners of the common shares entitled to vote at the Annual Meeting. The CompanyWe will bear the costs incurred in connection with the solicitation of proxies on behalf of the Board, other than the Internet access or telephone usage fees which may be charged to shareholders.
10 | Worthington | |
Security Ownership of Certain Be
The following table furnishes as of the Record Date (unless otherwise noted below), with respect to each person known to the Companyus to be the beneficial owner of more than 5% of theour outstanding common shares, of the Company, the name and address of such owner and the number and percentage of outstanding common shares beneficially owned (as determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)).
Name and Address of Beneficial Owner |
| Amount and Nature of Beneficial Ownership (1) | Percent of Outstanding Common Shares (2) |
|
| Amount and Nature of Beneficial Ownership (1) | Percent of Outstanding Common Shares (2) |
| ||||||||
John P. McConnell |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
200 Old Wilson Bridge Road, Columbus, OH 43085 |
|
| 17,542,966 |
| (3) | 30.8% |
|
|
| 17,336,760 |
| (3) | 34.9% |
| ||
BlackRock, Inc. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
55 East 52nd Street, New York, NY 10055 |
|
| 4,744,159 |
| (4) | 8.3% |
|
|
| 4,044,503 |
| (4) | 8.2% |
| ||
The Vanguard Group, Inc. |
|
|
|
|
|
|
|
| ||||||||
The Vanguard Group |
|
|
|
|
|
|
|
| ||||||||
100 Vanguard Blvd., Malvern, PA 19355 |
|
| 3,926,244 |
| (5) | 6.9% |
|
|
| 3,316,859 |
| (5) | 6.7% |
|
(1) | Except as otherwise indicated by footnote, each named beneficial owner has sole voting power and sole dispositive power over the listed common shares. |
(2) | The “Percent of Outstanding Common Shares” is based on the sum of |
(3) | Includes 12,415,982 common shares held of record by JMAC, Inc. (“JMAC”), a private investment company substantially owned, directly or indirectly, by Mr. McConnell and members of his family. The directors of JMAC have granted Mr. McConnell sole voting and dispositive power with respect to these 12,415,982 common shares. JMAC has the right to receive the dividends from and the proceeds from the sale of such 12,415,982 common shares. Includes 2,428,312 common shares held of record by an independent corporate trustee in trust for the benefit of Mr. McConnell and his sister. The trustee has voting and dispositive power; however, the trustee’s investment decisions are subject to the prior approval or disapproval of Mr. McConnell and, accordingly, Mr. McConnell may be deemed to “share” dispositive power with the trustee. Mr. McConnell has the right to change the trustee; however, any successor trustee appointed by Mr. McConnell must be an independent corporate trustee. Includes |
(4) | Information is based on Amendment No. |
(5) | Information is based on Amendment No. |
Security Ownership of Certain Beneficial Owners and Management • | 11 |
The following table furnishes the number and percentage of outstanding common shares beneficially owned (as determined in accordance with Rule 13d-3 under the Exchange Act) by: (a) each of our current director of the Company;directors; (b) each of the Company’sour director nominees; (c) each individual named in the “Fiscal 2019 Summary Compensation Table”;NEO; and (d) all of our current directors and executive officers of the Company as a group, in each case as of the Record Date.
| AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP (1) |
|
|
|
| |||||||||||||
Name of Beneficial Owner |
| Number of Common Shares Presently Held and Which Can Be Acquired Upon Exercise of Currently Exercisable Options | Percent of Outstanding Common Shares (2) | Theoretical Common Shares Credited to Bookkeeping Accounts in the Company's Deferred Compensation Plans (3) |
| Amount and Nature of Beneficial Ownership (1) | Percent of Outstanding Common Shares (2) |
| Theoretical Common Shares Credited to Bookkeeping Accounts in Our Deferred Compensation Plans (3) |
| ||||||||
Kerrii B. Anderson |
|
| 63,493 |
| (4) (5) | * | 4,853 |
|
| 69,993 |
| (4) (5) | * |
|
| 6,996 |
| |
David P. Blom |
| — |
|
| * | — |
|
| 9,500 |
| (4) | * |
|
| 0 |
| ||
John B. Blystone |
|
| 189,370 |
| (4) | * | — |
|
| 154,825 |
| (4) | * |
|
| 0 |
| |
Dale T. Brinkman (6) |
|
| 73,343 |
| (7) | * | — |
| ||||||||||
Mark C. Davis |
|
| 36,180 |
| (4) | * | — |
|
| 34,860 |
| (4) | * |
|
| 0 |
| |
Michael J. Endres |
|
| 190,140 |
| (4) (8) | * | 67,747 |
|
| 134,640 |
| (4) (6) | * |
|
| 79,826 |
| |
Geoffrey G. Gilmore (6) |
|
| 225,273 |
| (7) (9) | * |
| 7,379 |
| |||||||||
Joseph B. Hayek (6) |
|
| 28,155 |
| (7)(10) | * |
| 1,055 |
| |||||||||
Geoffrey G. Gilmore (7) |
| 198,837 |
| (8) | * |
|
| 10,671 |
| |||||||||
Joseph B. Hayek (7) |
| 173,047 |
| (9) | * |
|
| 2,061 |
| |||||||||
Ozey K. Horton, Jr. |
|
| 36,323 |
| (4) (11) | * | — |
|
| 37,869 |
| (4) | * |
|
| 0 |
| |
Peter Karmanos, Jr. |
|
| 68,540 |
| (4) (12) | * |
| 90,314 |
|
| 78,040 |
| (4) (10) | * |
|
| 104,880 |
|
John G. Lamprinakos (6) |
|
| 95,199 |
| (7) (13) | * | — |
| ||||||||||
John P. McConnell (6) |
|
| 17,542,966 |
| (7) (14) | 30.8% | — |
| ||||||||||
Catherine M. Lyttle (7) |
| 72,734 |
| (11) | * |
|
| 339 |
| |||||||||
John P. McConnell (7) |
| 17,336,760 |
| (12) | 34.9% |
|
| 0 |
| |||||||||
Carl A. Nelson, Jr. |
|
| 86,473 |
| (4) (15) | * | — |
|
| 87,455 |
| (4) (13) | * |
|
| 0 |
| |
Sidney A. Ribeau |
|
| 68,369 |
| (4) (16) | * | 17,009 |
|
| 58,505 |
| (4) | * |
|
| 18,244 |
| |
B. Andrew Rose (6) |
|
| 738,412 |
| (7) (17) | * | — |
| ||||||||||
Mark A. Russell (6) |
|
| 21,834 |
| (7) (18) | * | — |
| ||||||||||
B. Andrew Rose (7) |
| 816,056 |
| (14) | 1.6% |
|
| 0 |
| |||||||||
Mary Schiavo |
|
| 71,172 |
| (4) (19) | * | 5,345 |
|
| 75,574 |
| (4) | * |
|
| 5,733 |
| |
Virgil L. Winland (6) |
|
| 195,711 |
| (7) (20) | * | — |
| ||||||||||
All Current Directors and Executive Officers as a Group (20 people) |
|
| 19,851,267 |
| (21) (22) | 34.8% |
| 205,693 |
|
| 19,573,666 |
| (15) (16) | 39.2% |
|
| 228,750 |
|
* | Denotes ownership of less than 1% of the outstanding common shares. |
(1) | Except as otherwise indicated by footnote, each named beneficial owner has sole voting |
(2) | The “Percent of Outstanding Common Shares” is based on the sum of (a) |
(3) | This column lists the theoretical common shares credited to the bookkeeping accounts of the directors or executive officers participating in |
(4) | Includes for each of Ms. Anderson, Mr. Blom, Mr. Davis, Mr. Endres, Mr. Horton, Mr. Karmanos, Mr. Nelson, Dr. Ribeau, and Ms. Schiavo |
(5) | Includes 436 common shares held by Ms. Anderson’s spouse, who has sole voting |
(6) |
|
| Includes |
|
|
|
|
(9) | Includes 26,901 common shares subject to Currently Exercisable Options. Also includes (i) 71,900 restricted common shares which will vest over time based on continued employment with us; and (ii) 50,000 restricted common shares which will vest only if and when both (a) the closing price of the common shares meets or exceeds $65.00 per share for 90 consecutive days during the five-year period ending on September 25, 2024, and (b) Mr. Hayek has continuously remained our employee through September 25, 2024. See footnote (16) below for more information on the restricted common shares. |
(10) | Includes |
(11) | Includes 18,634 common shares subject to Currently Exercisable Options. Also includes |
|
|
(12) |
|
(13) |
|
|
|
| Includes |
|
|
| Includes 1,187 common shares held by Mr. Rose’s wife, who has sole voting |
|
|
|
|
|
|
| The number of common shares shown as beneficially owned by |
| The restricted common shares granted to our executive officers and non-employee directors |
Delinquent Section 16(a) Reports
Section 16(a) of the Exchange Act requires that the Company’s directors and executive officers and greater-than-10% beneficial owners of the Company’s outstanding common shares file reports with the SEC reporting their initial beneficial ownership of common shares and any subsequent changes in their beneficial ownership. Specific due dates for such reports have been established by the SEC and the Company is required to disclose in this Proxy Statement any late report or known failure to file a required report. To the Company’s knowledge, based solely on a review of the copies of the reports filed electronically with the SEC and written representations that no other reports were required, the Company believes that during Fiscal 2019, all Section 16(a) filing requirements applicable to the Company’s directors and executive officers and greater-than-10% beneficial owners of the Company’s outstanding common shares were complied with, with the exception of one Form 4 reporting two transactions for John P. McConnell, which was one day late in reporting a stock option award and a restricted share award due to an error in the type of filing initially submitted (test filing was submitted instead of live filing and was caught and corrected the following day).
Security Ownership of Certain Beneficial Owners and Management • | 13 |
Governance
Corporate Governance Guidelines
Upon the recommendation of the Nominating and Governance Committee, in accordance with applicable NYSE Rules, the Board has adopted the Corporate Governance Guidelines to promote the effective functioning of the Board and its committees and to reflect the Company’sour commitment to high standards of corporate governance. The Board, with the assistance of the Nominating and Governance Committee, periodically reviews the Corporate Governance Guidelines to ensure they comply with all applicable requirements.
The Corporate Governance Guidelines are available on the “Corporate Governance”“Governance” page of the “Investor Center”“Investors” section of the Company’sour website located at www.worthingtonindustries.com.
Code of Conduct
In accordance with applicable NYSE Rules and the applicable rules and regulations of the SEC (the “SEC Rules”), the Board adopted the Worthington Industries, Inc. Code of Conduct (the “Code of Conduct”). to serve as the ethical and legal standards for our directors, officers and employees. The Code of Conduct reinforces our commitment to adhere to high standards of business ethics. The Code of Conduct also establishes ethical principles by which our principal executive officer, principal financial officer, principal accounting officer, controller or persons performing similar functions are expected to conduct themselves in carrying out their duties and responsibilities. The Code of Conduct is available on the “Corporate Governance”“Governance” page of the “Investor Center”“Investors” section of the Company’sour website located at www.worthingtonindustries.com.
Director Independence
Pursuant to the Corporate Governance Guidelines, a director is determined to be an independent director if he or she is independent of management and has no material relationship with the Company,us, either directly or indirectly as a partner, shareholder or officer of an entity that has such a relationship with the Company,us, as affirmatively determined by the Board. The Board observes all additional criteria for independence established by the NYSE or required under SEC Rules or other applicable laws and regulations.
The Board has been advised of the nature and extent of any direct or indirect personal and business relationships between the Companyus and Kerrii Anderson, John Blystone, Mark Davis, Michael Endres, Ozey Horton, Jr., Peter Karmanos, Jr., Carl Nelson, Jr., Sidney Ribeau or Mary Schiavo, individually (each, an “Independent Director”each director and collectively, the “Independent Directors”),director nominee or any entities for which any Independent Directordirector or director nominee is a partner, officer, employee or shareholder. The Board has reviewed, considered and discussed such relationships, and the compensation which each Independent Directordirector or director nominee has received, directly or indirectly, from the Company,us, in order to determine whether each Independent Directordirector and director nominee meets the independence requirements of the Corporate Governance Guidelines, the applicable NYSE Rules and the applicable SEC Rules. The Board has affirmatively determined that (a) none of Kerrii Anderson, David Blom, John Blystone, Mark Davis, Michael Endres, Ozey Horton, Jr., Peter Karmanos, Jr., Carl Nelson, Jr., Sidney Ribeau or Mary Schiavo (each, an “Independent Director” and collectively, the Independent Directors has“Independent Directors”) have any relationship with the Company,us, either directly or indirectly, including, without limitation, any commercial, industrial, banking, consulting, legal, accounting, charitable or familial relationship, which: (i) interfered, interferes, or may interfere, with his or her independence from management and the Companyus or the exercise of his or her independent judgment, (ii) would be inconsistent with a determination of independence under applicable NYSE Rules and SEC Rules, or (iii) would impair his or her independence under the Corporate Governance Guidelines; and (b) each of the Independent Directors qualifies as an “Independent Director” under the Corporate Governance Guidelines. As required by applicable NYSE Rules, the Independent Directors represent a majority of the Company’sour directors. John P. McConnell does not qualify as independent under applicable NYSE Rules or SEC Rules or the Corporate Governance Guidelines because he is anour executive officer of the Company. David Blom does not qualify as independent under applicable NYSE Rules or SEC Rules or the Corporate Governance Guidelines because John P. McConnell served as a member of the compensation committee of OhioHealth Corporation while Mr. Blom was an executive officer of OhioHealth Corporation.chairman.
Barring any unusual circumstances, the Board has determined that a director’s independence would not be impaired if: (a) the director is an executive officer or an employee (or his or her immediate family member is an executive officer or an employee) of a company that makes payments to, or receives payments from, the Companyus for property or services performed in the ordinary course of business in an amount which, in any single fiscal year, does not exceed the greater of $1,000,000 or 2% of such other company’s consolidated gross revenues; (b) the Company makeswe make contributions to a scholastic
|
|
or charitable tax-exempt organization for which the director (or his or her immediate family member) serves as either a member of the board of directors (or similar governing body) or an officer if the contributions, in any single fiscal year, do not exceed the greater of $500,000 or 1% of the total contributions received by that tax-exempt organization during such fiscal year; or (c) the Company useswe use facilities (dining facilities, clubs, etc.) in which the director is a greater than 5% owner if charges to the Companyus are consistent with charges paid by unrelated third parties and are fair, reasonable and consistent with those for similar services available at similar facilities, as long as the charges do not reach other thresholds under theapplicable NYSE Rules which would disqualify a director from being independent.
14 | Worthington | 2022 Proxy Statement • Corporate Governance |
The Board specifically considered a number of circumstances in the course of reaching the conclusion that the current Independent Directors qualify as independent under the Corporate Governance Guidelines as well as applicable NYSE Rules and SEC Rules, including the relevant relationships described below in the section captioned “TRANSACTIONS WITH CERTAIN RELATED PERSONS” beginning on page 30 of“Transactions With Certain Related Persons” in this Proxy Statement.
Nominating Procedures
The Board’s Nominating and Governance Committee has responsibility for providing oversight on a broad range of issues surrounding the composition and operation of the Board, including identifying candidates qualified to become directors and recommending director nominees to the Board.
When considering candidates for the Board, the Nominating and Governance Committee evaluates the entirety of each candidate’s credentials but does not have specific eligibility requirements or minimum qualifications which must be met by a Nominating and Governance Committee-recommended nominee and has not adopted a formal policy with regard to the consideration of diversity in identifying director nominees. The Nominating and Governance Committee considers those factors it deems appropriate, including, but not limited to, independence, judgment, skill, diversity, strength of character, ethics and integrity, experience with businesses or organizations of comparable size or scope, experience as an executive of or adviser to public and private companies, experience and skill relative to other Board members, specialized knowledge or expertise, and the desirability of the candidate’s membership on the Board and any committees of the Board. Depending on the current needs of the Board, the Nominating and Governance Committee may weigh certain factors more or less heavily. The Nominating and Governance Committee does, however, believe that all members of the Board should have strong character and integrity, a reputation for working constructively with others, sufficient time to devote to Board matters, and no conflict of interest that would interfere with his or her performance as a director.
While the Board and the Nominating and Governance Committee do not have specific eligibility requirements and do not, as a matter of course, weigh any of the factors they deem appropriate more heavily than others, both the Board and the Nominating and Governance Committee believe that, as a group, the directors should have diverse backgrounds and qualifications. The Company believesWe believe that the members of the Board, as a group, have such backgrounds and qualifications.
The Nominating and Governance Committee considers candidates for the Board from any reasonable source, including shareholder recommendations, but does not evaluate candidates differently based on the source of the recommendation. The process for seeking and vetting additional director candidates is ongoing and is not dependent upon the existence of a vacancy on the Board. Accordingly, the Board believes that this ongoing identification of qualified candidates functions as an appropriate director succession plan. Pursuant to its charter, the Nominating and Governance Committee has the authority to retain consultants and search firms to assist with the process of identifying and evaluating director candidates and to approve the fees and other retention terms for any such consultant or search firm. The Nominating and Governance Committee has never used a consultant or search firm for such purpose, and, accordingly, the Company haswe have paid no such fees.
Shareholders may recommend director candidates for consideration by the Nominating and Governance Committee by sending the recommendation to the Chair of the Nominating and Governance Committee, in care of the Company,our Secretary, to the Company’sour executive offices at 200 Old Wilson Bridge Road, Columbus, Ohio 43085. The recommendation must include the candidate’s name, age, business address, residence address and principal occupation. The recommendation must also describe the qualifications, attributes, skills or other qualities possessed by the recommended director candidate. A written statement from the candidate consenting to serve as a director, if elected, and a commitment by the candidate to meet personally with Nominating and Governance Committee members must accompany any such recommendation.
Corporate Governance • | 15 |
The Board, taking into account the recommendations of the Nominating and Governance Committee, selects nominees for election as directors at each Annual Meeting. In addition, shareholders wishing to nominate directors may do so, provided they comply with the nomination procedures set forth in the Company’s Code of Regulations and applicable SEC Rules. In order to nominate an individual for election as a director at a meeting, a shareholder must give written notice of the shareholder’s intention to make such nomination. The notice must be sent to the Company’sour Secretary, and either delivered in person to, or mailed to and received at, the Company’sour principal executive offices at 200 Old Wilson Bridge Road, Columbus, Ohio 43085 not less than 14 days or more than 50 days prior to any meeting called for the election of directors. However, if notice or public disclosure of the date of the meeting is given or made less than 21 days prior to the meeting, the shareholder notice must be received by the Company’sour Secretary not later than the close of business on the seventh day following the day on which notice of the date of the meeting was mailed or publicly disclosed. The Company’sOur Secretary will deliver any shareholder notice received in a timely manner to the Nominating and Governance Committee for review. Each shareholder notice must include the following information as to each individual the shareholder proposes to nominate for election or re-election as a director: (a) the name, age, business address and, if known, residence address of the proposed nominee; (b) the principal occupation or employment of the proposed nominee; (c) the number of common shares of the Company beneficially owned by the proposed nominee; and (d) any other information relating to the proposed nominee that is required to be disclosed concerning nominees in proxy solicitations under applicable SEC Rules, including the individual’s written consent to be named in the proxy statement as a nominee and to serve as a director, if elected. The nominating shareholder must also provide (i) the name and address of the nominating shareholder; and (ii) the number of common shares of the Company beneficially owned by the nominating shareholder. No individual may be elected as a director unless he or she has been nominated by a shareholder in the manner described above or by the Board or the Nominating and Governance Committee.
Compensation Committee Interlocks and Insider Participation
The Compensation Committee of the Board (the “Compensation Committee”) is currently comprised of John Blystone (Chair), Kerrii Anderson, Michael Endres and Ozey Horton, Jr. No member of the Compensation Committee is a present or past employee or officer of the Company.ours. During Fiscal 20192022 and through the date of this Proxy Statement, none of the Company’sour executive officers has served on the board of directors or compensation committee (or other committee performing equivalent functions) of any other entity, one of whose executive officers served on the Company’s Board or Compensation Committee, other than John P. McConnell, who served as a member of the compensation committee of OhioHealth Corporation while David Blom was an executive officer of OhioHealth Corporation.Committee.
Communications with the Board
The Board believes it is important for shareholders and other interested persons to have a process by which to send communications to the Board and its individual members, including the Lead Independent Director. Accordingly, shareholders and other interested persons who wish to communicate with the Board, the non-management directors as a group, the Independent Directors, as defined by the Corporate Governance Guidelines and applicable NYSE Rules as a group, the Lead Independent Director or any other individual director may do so by addressing such correspondence to the name(s) of the specific director(s), to the “Non-Management Directors” as a whole, to the “Independent Directors” as a whole or to the “Board of Directors” as a whole, and sending it in care of the Company,our Secretary, to the Company’sour executive offices at 200 Old Wilson Bridge Road, Columbus, Ohio 43085. The mailing envelope must contain a clear notation indicating that the enclosed correspondence is a “Shareholder/Interested Person – Non-Management Director Communication”, “Shareholder/Interested Person – Independent Director Communication”, “Shareholder/Interested Person – Board Communication”, “Shareholder/Interested Person – Lead Independent Director Communication”, or “Shareholder/Interested Person – Director Communication”, as appropriate. All such correspondence must identify the author as a shareholder or other interested person (identifying such interest) and clearly indicate whether the communication is directed to all members of the Board, to the “Non-Management Directors” as a whole, to the “Independent Directors” as a whole or to a certain specified individual director(s). Copies of all such correspondence will be circulated to the appropriate director(s). Correspondence marked “personal and confidential” will be delivered to the intended recipient(s) without opening. There is no screening process in respect of communications from shareholders or other interested persons. The process for forwarding communications to the appropriate Board member(s) has been approved by the Company’s Independent Directors.
Questions, complaints and concerns may also be submitted to Companyour directors through our Worthington Industries EthicsLine ReportingCode of Conduct & Ethics Line website at www.Worthington.EthicsPoint.com or by calling 877-263-9893 inside the United States and Canada.
16 | Worthington | |
Corporate Citizenship and Sustainability Highlights
In addition to our commitment to high ethical standards and sound corporate governance practices, which are summarized in the “Commitment to Shareholders / Governance” section in this Proxy Statement, we are dedicated to responsible corporate citizenship. Although our approach to corporate citizenship is ever evolving, our primary focus remains our people, our community and our environmental footprint. We are constantly seeking to improve on and rely on our Philosophy rooted in the Golden Rule to guide us through all aspects of corporate citizenship and sustainability.
In line with our people-first Philosophy, our employees have always been, and will always be, our most important asset. As such, we are continually focused on creating and maintaining a strong corporate culture. Our culture provides employees with opportunities for personal and professional development, as well as community engagement, all of which we believe contribute to our overall success. We have repeatedly been recognized as a top place to work and we offer our employees competitive pay and above-market benefits, as compared to others in our industry, all while focusing on safety, wellness, and promoting a diverse and inclusive culture.
Our Philosophy guides and encourages us to practice good citizenship which is reflected in our employees’ efforts in our communities. Through financial contributions to not-for-profit organizations and volunteering, we are working to improve the quality of life in the communities where we live and work. We believe that together, better is possible at work and in our communities.
We have always made protecting our people and the environment a top priority. We have demonstrated our commitment to environmentally responsible operations by conforming to international standards for environmental management (ISO 14001) and reducing our impact on the environment in multiple areas of our global business. In addition, we have sought continuous improvement in our health and safety programs, which follow ISO 45001 standards, and regularly have an industry-leading safety record.
For more details on our corporate citizenship and sustainability efforts, please see our annual Corporate Citizenship and Sustainability Report available on our website at https://worthingtonindustries.com/Sustainability-Report.
Corporate Governance • 2022 Proxy Statement | Worthington | 17 |
There are currently 11 directors – four in the class whose terms expire at the Annual Meeting and who are proposed to be re-elected for terms expiring at the Annual Meeting of Shareholders in 2022;2025; four in the class whose terms expire at the Annual Meeting of Shareholders in 2023; and three in the class whose terms expire at the Annual Meeting of Shareholders in 2020; and four in the class whose terms expire at the Annual Meeting of Shareholders in 2021. On June 26, 2019, the Board, upon the unanimous recommendation of the Nominating and Governance Committee, increased the authorized number of directors of the Company to 11, and unanimously appointed David P. Blom as a director of the Company in the class whose terms expires at this Annual Meeting of Shareholders.2024.
The Board proposes that the four director nominees named in the following summary, below, each of whom was unanimously recommended by the Nominating and Governance Committee, be re-elected as directors at the Annual Meeting. Each individual elected as a director at the Annual Meeting will hold office for a three-year term, expiring at the Annual Meeting of Shareholders in 2022,2025, and until his/her successor is duly elected and qualified, or until his/her earlier death, resignation or removal from office. The individuals named as proxy holders in the form of proxy solicited by the Board intend to vote the common shares represented by the proxies received under this solicitation for the Board’s nominees, unless otherwise instructed on the form of proxy. If any nominee becomes unable to serve or for good cause will not serve as a candidate for election as a director, the individuals designated to vote the proxies will have full discretion to vote the common shares represented by the proxies they hold for the election of the remaining nominees and for the election of any substitute nominee designated by the Board. The Board has no reason to believe that any of the Board’s nominees will be unable to serve or for good cause will not serve as a director of the Company if elected.
Information Concerning Nominees and Continuing Directors
The information set forth below,in the following summary, concerning the age, principal occupation, other affiliations and business experience of each director has been furnished to the Companyus by such director as of August 1, 2019.2022. Except where otherwise indicated, each director has had the same principal occupation for the last five years. There are no family relationships among any of theour current directors, director nominees and executive officers of the Company.officers.
18 | Worthington | 2022 Proxy Statement • Proposal 1: Election of Directors |
|
Nominees Standing for Re-Election to the Board at the 20192022 Annual Meeting
|
Kerrii B. Anderson |
| Age | Director since 2010 |
|
| Kerrii B. Anderson has served continuously as a director of the Company since |
| |||
|
|
|
|
David P. Blom |
| Age | Director since 2019 |
|
| David P. Blom has served continuously as a director of the Company since June |
| |||
|
|
|
|
| 19 |
| Mary Schiavo |
| Age | Director since 1998 |
|
| Mary Schiavo has served continuously as a director of the Company since 1998 and is a member of the Audit Committee and the Nominating and Governance Committee. Ms. Schiavo has been |
| |||
|
|
Directors Whose Terms Continue Until the 20202023 Annual Meeting of Shareholders
| Michael J. Endres |
| Age | Director since 1999 |
|
| Michael J. Endres has served continuously as a director of the Company since 1999 and is a member of the Executive Committee and the Compensation Committee. Mr. Endres serves as |
| |||
|
|
|
20 | Worthington | 2022 Proxy Statement • Proposal 1: Election of Directors |
| Ozey K. Horton, Jr. |
| Age | Director since 2011 |
|
| Ozey K. Horton, Jr. has served continuously as a director of the Company since 2011 and is a member of the Compensation Committee and the Nominating and Governance Committee. He is an independent advisor and serves as Director Emeritus of McKinsey & Company, a management consulting firm, from which he retired in February 2011. Prior to that time, Mr. Horton served as a Director in the Atlanta office of McKinsey & Company from 1981 through February 2011. Over the years, Mr. Horton led numerous corporate growth, strategic, mergers and acquisitions, and performance improvement initiatives at global clients across a range of industries — especially in the basic industrials space (such as metals and mining; pulp, paper and packaging; chemicals; and energy). He has also led several practices within McKinsey & Company: as founder of the global pulp, paper, and packaging practice; co-leader of the global basic materials practice; and leader of the global operations practice within the energy and materials sector. Prior to his service with McKinsey & Company, Mr. Horton had early career experiences in manufacturing, corporate development and project engineering. Mr. Horton has served as a director of Louisiana-Pacific Corporation, a global leader in engineered wood products, since September 2016 where he currently serves as a member of its Finance & Audit Committee and |
| |||
|
|
|
|
|
| Peter Karmanos, Jr. |
| Age | Director since 1997 |
|
| Peter Karmanos, Jr. has served continuously as a director of the Company since 1997, is Chair of the Nominating and Governance Committee and is a member of the Executive Committee. Mr. Karmanos founded Compuware, a software development company, in 1973. He served as Chairman of the Board, Chief Executive Officer and a director of Compuware Corporation from its founding until June 2011. He continued to serve as Executive Chairman of the |
| |||
|
|
|
Proposal 1: Election of Directors • 2022 Proxy Statement | Worthington | 21 |
| Carl A. Nelson, Jr. |
| Age | Director since 2004 |
|
| Carl A. Nelson, Jr. has served continuously as a director of the Company |
| |||
|
|
|
|
|
Directors Whose Terms Continue Until the 20212024 Annual Meeting of Shareholders
| John B. Blystone |
| Age | Director since 1997 |
|
| John B. Blystone has served continuously as a director of the Company since 1997 and as the Lead Independent Director |
| |||
|
|
|
| Mark C. Davis |
| Age | Director since 2011 |
|
| Mark C. Davis has served continuously as a director of the Company since |
| |||
|
|
|
22 | Worthington | 2022 Proxy Statement • Proposal 1: Election of Directors |
| Sidney A. Ribeau |
| Age | Director since 2000 |
|
| Sidney A. Ribeau has served continuously as a director of the Company since 2000 and is a member of the Nominating and Governance Committee. Since October 2013, Dr. Ribeau has served as Professor of Communications for Howard University, and he also served as President of Howard University from August 2008 to October 2013. Dr. Ribeau served as President of Bowling Green State University for more than 13 years prior to that time. Dr. Ribeau |
| |||
|
|
|
|
|
Required Vote and Board’s Recommendation
Under Ohio law and the Company’sour Code of Regulations, the four nominees for election to the Board receiving the greatest number of votes “FOR” their election will be elected as directors of the Company.
Except in the case of broker non-votes, common shares represented by properly completed and timely received forms of proxy will be voted “FOR” the election of the Board’s nominees, unless authority to vote for one or more of the nominees is withheld. Common shares as to which the authority to vote is withheld will not be counted toward the election of directors or the election of the individual nominees specified on the form of proxy. Proxies may not be voted for more than four nominees.
THE BOARD UNANIMOUSLY RECOMMENDS THAT THE
OUR SHAREHOLDERS OF THE COMPANY VOTE “FOR” THE
ELECTION OF EACH OF THE DIRECTOR NOMINEES NAMED ABOVE.
Proposal 1: Election of Directors • 2022 Proxy Statement | Worthington | 23 |
Meetings of the Board
The Board held four meetings during Fiscal 2019, all of which were regularly scheduled meetings.2022. During Fiscal 2019,2022, each incumbent director who was then serving attended at least 75%, other than Mr. Karmanos who attended 50% due to a temporary inability to travel, of the aggregate of (a) the total number of meetings held by the Board, and (b) the total number of meetings held by all committees of the Board on which such director served.
The Board and our management of the Company are committed to effective corporate governance practices. The Corporate Governance Guidelines describe the governance principles and procedures by which the Board functions. The Board annually reviews and updates, as appropriate, the Corporate Governance Guidelines and the charters of the various committees of the Board in response to corporate governance developments, including changes in the applicable NYSE Rules and SEC Rules, and recommendations by directors in connection with Board and Board committee evaluations. In accordance with the Corporate Governance Guidelines and applicable NYSE Rules, our non-management directors, of the Company, who with the exception of David Blom, are all “Independent” Directors, as defined by the Corporate Governance Guidelines and applicable NYSE Rules, meet (without management present) at regularly scheduledin executive sessions at least twice per year andsession at such other times as the non-management directors deem necessary or appropriate.appropriate, but at least once annually. These executive sessions are typically held in conjunction with regularly scheduled Board meetings and are led by the Lead Independent Director, and appropriate feedback from these sessions is given to the Chief Executive Officer.Officer (“CEO”) and the Executive Chairman. The non-management and the independent directorsIndependent Directors met in executive session after threeeach of the four regularly scheduled Board meetings held in Fiscal 2019.2022.
Board Member Attendance at Annual Meetings of the Shareholders
The Company doesWe do not have a formal policy with respect to attendance by our directors at the annual meetings of the shareholders. The Board generally schedules its quarterly meetings to fall in March, June, September and December. FourFive of the ten11 then-incumbent directors attended the Company’s 2018our 2021 annual meeting of shareholders (“2021 Annual Meeting of Shareholders:Meeting”): Mr. Blom, Mr. Blystone, Mr. McConnell,Horton, Mr. NelsonMcConnell and Ms. Schiavo.
Board Leadership Structure
The CompanyBoard is led by John P.Mr. McConnell, who has servedbecame Executive Chairman in September 2020, after serving as Chief Executive Officer sinceCEO from June 1993 asuntil September 2020. He has been a director of the Company since 1990 and has served as Chairman of the Board of the Company since September 1996. The Company's Board is currently comprised of Mr. McConnell and ten non-management directors. JohnMr. Blystone is the Company’sour Lead Independent Director.
The Board has four standing committees: Audit, Compensation, Executive, and Nominating and Governance. Each of the Audit Committee, the Compensation Committee, and the Nominating and Governance Committee is chaired by a separate Independent Director and is comprised solely of Independent Directors. Detailed information on each Board committee is contained in the section captioned “PROPOSAL“Proposal 1: ELECTION OF DIRECTORSElection of Directors — Committees of the Board” beginning on page 25 ofin this Proxy Statement.
|
|
The Company doesWe do not have a fixed policy regarding whether the offices of Chairman of the Board and Chief Executive OfficerCEO should be vested in the same person or two different people. ThePrior to Mr. McConnell retiring as CEO in September 2020, the Board hashad long determined that the most effective leadership structure at the present time is for the Chief Executive Officer to also serve as the Chairman of the Board,was having Mr. McConnell in both roles, coupled with a Lead Independent Director, independent chairs for our Audit Committee, our Compensation Committee, and our Nominating and Governance Committee, and regularly scheduled executive sessions of the non-management and independent directors.
The Board believes having Mr. McConnell in the role of Executive Chairman and Mr. Rose as the CEO, while maintaining a Lead Independent Director, is an effective management structure, and that the currently combined role of Chairman of the Board and Chief Executive Officerstructure promotes the development and execution of our business strategy and facilitates information flow between management and the Board, which are essential to effective governance. The Board believes that its strong governance practices, including its supermajority of Independent Directors, the combination ofchange to separate the Executive Chairman of the Board and Chief Executive OfficerCEO roles, and itsthe clearly-defined Lead Independent Director responsibilities, provide an appropriate balance among strategy development, operational execution and independent oversight of the Company.
The Board periodically reviews our leadership structure and retains the authority to modify the structure, as and when appropriate, to address our then current circumstances.
24 | Worthington | 2022 Proxy Statement • Proposal 1: Election of Directors |
Lead Independent Director
In January 2007, the Companywe established a Lead Independent Director position and appointed JohnMr. Blystone as the Lead Independent Director.
A copy of the Company'sour Lead Independent Director Charter is available on the “Corporate Governance”“Governance” page of the “Investor Center”“Investors” section of the Company’sour website located at www.worthingtonindustries.com. In addition to the other duties more fully described in the Company’sour Lead Independent Director Charter, the Lead Independent Director is responsible for:
advising the Chairman of the Board and Chief Executive Officerthe CEO regarding the information, agenda and meeting schedules for the Board and Board committees, and as to the quality, quantity and timeliness of the information submitted to the Board by the Company’sour management that is necessary or appropriate for the non-employee directors to effectively and responsibly perform their duties;
recommending to the Chairman of the Board and Chief Executive Officerthe CEO the retention of advisers and consultants who report directly to the Board;
assisting the Board, the Nominating and Governance Committee and theour officers of the Company in ensuring compliance with and implementation of the Corporate Governance Guidelines;
calling meetings of the non-employee directors, developing the agenda for and serving as chairman of the executive sessions of the non-employee directors, and serving as principal liaison between the non-employee directors and the Chairman of the Board and Chief Executive Officer on sensitive issues;the CEO;
working with the Nominating and Governance Committee, and the Chairman of the Board and Chief Executive Officerthe CEO to recommend the membership of the various Board committees, as well as the selection of Board committee chairs;
serving as chair of meetings of the Board when the Chairman of the Board is not present;
being available for consultation and direct communications with the Company’sour shareholders, if requested and appropriate; and
performing such other duties as the Board may determine.
|
| 25 |
Committees of the Board
The Board has four standing committees: the Executive Committee, the Audit Committee, the Compensation Committee, and the Nominating and Governance Committee. The charter for each committee has been reviewed and approved by the Board and is available on the “Corporate Governance”“Governance” page of the “Investor Center”“Investors” section of the Company’sour website located at www.worthingtonindustries.com.
Committees of the Board
|
|
| ||
| Executive | Audit | Compensation | Nominating and Governance |
Kerrii B. Anderson* |
|
|
| |
David P. |
|
|
| |
John B. Blystone* |
|
| ||
Mark C. Davis* |
|
|
|
|
Michael J. Endres* |
|
| ||
Ozey K. Horton, Jr.* |
|
| ||
Peter Karmanos, Jr.* |
|
| ||
John P. McConnell |
|
|
| |
Carl A. Nelson, Jr.* |
|
|
| |
Sidney A. Ribeau* |
|
|
| |
Mary Schiavo* |
|
|
*Independent director under applicable NYSE Rules
|
|
The Executive Committee acts in place of, and on behalf of, the Board in the intervals between meetings of the Board. The Executive Committee has all of the authority of the Board, other than the authority (a) to fill vacancies on the Board or on any committee of the Board, (b) to amend the Company’sour Code of Regulations, (c) that has been delegated by the Board exclusively to other committees of the Board, and (d) that applicable law or the Company’sour governing documents do not permit to be delegated to a committee of the Board.
Audit Committee
The Board has determined that each member of the Audit Committee qualifies as an Independent Director under the applicable NYSE Rules and under SEC Rule 10A-3. The Board believes each member of the Audit Committee is qualified to discharge his or her duties on our behalf of the Company and satisfies the financial literacy requirement of the applicable NYSE Rules. The Board has also determined that each of Ms. Anderson, Mr. Davis and Mr. Nelson qualifies as an “audit committee financial expert”, as that term is defined in Item 407(d)(5) of SEC Regulation S-K, by virtue of their respective experience, including thatas described on pages 18, 22 and 21, respectively,in Proposal 1 (Election of Directors) of this Proxy Statement. No member of the Audit Committee serves on the audit committee of more than two other public companies.
At least annually, the Audit Committee evaluates its performance, reviewing and assessing the adequacy of its charter and recommending any proposed changes to the full Board, as necessary to reflect changes in regulatory requirements, authoritative guidance and evolving practices.
26 | Worthington | 2022 Proxy Statement • Proposal 1: Election of Directors |
|
The Audit Committee was established in accordance with Section 3(a)(58)(A) of the Exchange Act. The Audit Committee is organized and conducts its business pursuant to a written charter. The primary responsibility of the Audit Committee is to assist the Board in the oversight of the financial and accounting functions, controls, reporting processes and audits of the Company.audits. Specifically, the Audit Committee appoints and evaluates the Company’sour independent registered public accounting firm and approves the audit engagement, including fees and terms, and non-audit engagements, if any, of such firm. The Audit Committee, on behalf of the Board, reviews, monitors and evaluates: (a) the Company’sour consolidated financial statements and the related disclosures, including the integrity and quality of theour consolidated financial statements; (b) the Company’sour compliance with legal and regulatory requirements, including the financial reporting process; (c) the Company’sour systems of disclosure controls and procedures and internal control over financial reporting and its accounting and financial controls; (d) the performance, qualifications and independence of the Company’sour independent registered public accounting firm, including the performance and rotation of the lead and concurring partners of that firm; (e) the performance of the Company’sour internal audit function; (f) the annual independent audit of the Company’sour consolidated financial statements; and (g) financial, reporting and compliance risk management.management; and (h) our overall enterprise risk management program including such matters related to privacy, information security, cybersecurity, business conduct, health and safety, compliance, environmental and social aspects. The Audit Committee also prepares the report that the SEC Rules require be included in the Company’sour annual proxy statement.
Additional duties and responsibilities set forth in the Audit Committee’s charter include:
reviewing, with the Company’sour financial management, internal auditors and independent registered public accounting firm, the Company’sour accounting procedures and policies and audit plans, including staffing, professional services to be provided, audit procedures to be used, and fees to be charged by the Company’sour independent registered public accounting firm and reviewing the activities of and the results of audits conducted by the Company’sour internal auditors and independent registered public accounting firm;
reviewing, with the ourCompany’s independent registered public accounting firm, the audit report of the ourCompany’s independent registered public accounting firm on the effectiveness of the Company’sour internal control over financial reporting filed with the Company’sour Annual Report on Form 10‑K;
establishing procedures for the receipt, retention and treatment of complaints received by the Companyus regarding accounting, internal accounting controls or auditing matters, as well as the confidential, anonymous submissions by our employees of the Company of concerns regarding questionable accounting or auditing matters;
setting and maintaining hiring policies for employees or former employees of the Company’sour independent registered public accounting firm;
receiving reports concerning any non-compliance with the Company’s Code of Conduct by anyour officers or directors of the Company and approving, if appropriate, any waivers therefrom;
administering the Company’sour Related Person Transaction Policy and approving, if appropriate, any “related person” transactions with respect to the Company’sour directors or executive officers;
reviewing with senior management, the Company’sour major financial risk exposures and the steps being taken to monitor and control them as well as the Company’sour guidelines and policies with respect to risk assessment and risk management and overall antifraud programs and controls;
directing and supervising any special investigations into matters which may come within the scope of the Audit Committee’s duties; and
other matters required by the Financial Accounting Standards Board, the American Institute of Certified Public Accountants, the Public Company Accounting Oversight Board, the SEC, the NYSE and other similar bodies or agencies which could have an effect on the Company'sour consolidated financial statements.
Pursuant to its charter, the Audit Committee has the authority to engage and terminate such legal counsel and other consultants and advisors as it deems appropriate to carry out its functions, including the sole authority to approve the fees and other terms of retention of such legal counsel and other consultants and advisors.
At least annually, the Audit Committee evaluates its performance, reviewing and assessing the adequacy of its charter and recommending any proposed changes to the full Board, as necessary to reflect changes in regulatory requirements, authoritative guidance and evolving practices.
The Audit Committee met four times during Fiscal 2019.2022. The Audit Committee’s report relating to Fiscal 2019 begins on page 89 of2022 is located in the “Audit Committee Matters” section in this Proxy Statement.
|
| 27 |
The Board has determined that each member of the Compensation Committee qualifies as an Independent Director under the applicable NYSE Rules. The Board has also determined that each member of the Compensation Committee satisfies the additional independence standards for members of a compensation committee under the applicable NYSE Rules. All members of the Compensation Committee also qualify as “outside directors” for purposes of Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), and as “non-employee directors” for purposes of Rule 16b-3 under the Exchange Act.
The Compensation Committee periodically reviews and reassesses the adequacy of its charter and recommends any proposed changes to the full Board, as necessary to reflect changes in regulatory requirements, authoritative guidance and evolving practices. The Compensation Committee evaluates its performance at least annually.
The Compensation Committee’s charter sets forth the duties and responsibilities of the Compensation Committee, which include:
discharging the Board’s responsibilities relating to compensation of the Company’s Chief Executive Officerour CEO and executive management, including reviewing and approving the compensation philosophy, policies, objectives and guidelines for the Company’sour executive management;
reviewing and approving, if it has been deemed appropriate, the Company’sour peer group companies and data sources for purposes of evaluating the Company’sour compensation competitiveness and establishing the appropriate competitive positioning of the levels and mix of compensation elements;
reviewing and approving corporate goals and objectives, including performance goals, relevant to Chief Executive OfficerCEO and executive management compensation and evaluating the performance of the Chief Executive OfficerCEO and executive management in light of the approved corporate goals and objectives;
reviewing and approving the metrics to be used for the determination ofdetermining payouts under cash-based and equity-based incentive programs;
setting the compensation of the Chief Executive OfficerCEO and other executive officers, including the amount and types of compensation;
preparing, producing, reviewing and/or discussing with the Company’s management, as appropriate, such reports and other information required by applicable laws, rules, regulations or other standards with respect to executive and director compensation, including those required for inclusion in the Company’sour proxy statement and/or Annual Report on Form 10-K;
providing recommendations to the Board on Company-sponsored compensation-related proposals to be considered at the Company’sour annual shareholder meetings, including Say-on-Paythe advisory vote on the compensation of our NEOs and Say-on-Frequency proposals,the frequency of that advisory vote, and reviewing and considering the results of such votes;
reviewing, and advising the Board with respect to, Board compensation;
administering the Company’sour equity-based incentive compensation plans, our other executive incentive compensation programs, and any other plans and programs which the Board designates;
reviewing and discussing with the Company’s management, the Company’sour compensation risk management disclosures required by SEC Rules relating thereto;
reviewing and making recommendations to the Board regarding, the creation or revision of any “clawback” or similar policy allowing us to recoup certain compensation paid to executive officers;
in consultation with the Nominating and Governance Committee, reviewing, evaluating and making recommendations to the Board concerning shareholder proposals relating to executive and/or director compensation issues and the Company’sour responses thereto; and
reviewing and discussing with management, our human capital management activities, including matters relating to talent management and development, talent attraction and retention, employee engagement and diversity, equity and inclusion; and
carrying out such other roles and responsibilities as the Board may designate or delegate to the Compensation Committee.
|
|
The Compensation Committee’s processes and procedures to determine executive compensation, including the use of compensation consultants and the role of executive officers in the executive compensation decision-making process, are described in the sections captioned “EXECUTIVE COMPENSATION“Executive Compensation — Compensation Discussion and Analysis — Role of the Compensation Committee” and “EXECUTIVE COMPENSATION“Executive Compensation — Compensation Discussion and Analysis — Executive Compensation Philosophy and Objectives” beginning on page 33 and page 35 respectively, ofin this Proxy Statement.
28 | Worthington | 2022 Proxy Statement • Proposal 1: Election of Directors |
Pursuant to its charter, the Compensation Committee has sole authority to retain and terminate any compensation consultant, legal counsel or other advisor, as the Compensation Committee deems appropriate to assist the Committee in the performance of its duties, including the sole authority to approve the fees and other terms and conditions of retention. Prior to any such retention, the Compensation Committee assesses any factors relevant to such consultant’s, legal counsel’s or advisor’s independence from management, including the factors specified in NYSE’s Corporate Governance Standards or other listing rules, to evaluate whether the services to be performed will raise any conflict of interest or compromise the independence of such consultant, legal counsel or advisor.
The Compensation Committee periodically reviews and reassesses the adequacy of its charter and recommends any proposed changes to the full Board, as necessary to reflect changes in regulatory requirements, authoritative guidance and evolving practices. The Compensation Committee evaluates its performance at least annually.
The Compensation Committee met three times during Fiscal 2019.2022. The Compensation Discussion and Analysis regarding executive compensation for our NEOs begins on page 33 of this Proxy Statement, and the Compensation Committee Report for Fiscal 2019 is on page 51 ofare located in the “Executive Compensation” section in this Proxy Statement.
Nominating and Governance Committee
The Board has determined that each member of the Nominating and Governance Committee qualifies as an Independent Director under the applicable NYSE Rules. The Nominating and Governance Committee periodically reviews and assesses the adequacy of its charter and recommends any proposed changes to the full Board, as necessary to reflect changes in regulatory requirements, authoritative guidance and evolving practices. The Nominating and Governance Committee evaluates its performance at least annually.
Under the terms of its charter, the Nominating and Governance Committee is to:
develop and periodically review principles of corporate governance and recommend them to the Board for its approval;
review theour Amended Articles of Incorporation, the Code of Regulations and the Corporate Governance Guidelines of the Company and recommend to the Board any changes deemed appropriate;
review the procedures and communication plans for shareholder meetings and ensure that required information regarding the Company is adequately presented;
review and make recommendations to the Board regarding (a) the composition and size of the Board in order to ensure that the Board has the proper expertise and its membership consists of persons with sufficiently diverse backgrounds, (b) the criteria for the selection of Board members and Board committee members, and (c) Board policies on age and term limits for Board members;
plan for continuity on the Board as existing Board members leave the Board;
with the participation of the Chairman of the Board, identify and recruit candidates for Board membership, evaluate Board candidates recommended by shareholders and arrange for appropriate interviews and inquiries into the qualifications of the candidates;
identify and recommend individuals to be nominated for election as directors by the shareholders and to fill vacancies on the Board;
with the Compensation Committee, provide for a review of succession plans for the Chairman of the Board and Chief Executive Officer in the case of his resignation, retirement or death;
evaluate the performance of current Board members proposed for re-election, and recommend to the Board whether such members of the Board should stand for re-election; oversee an annual evaluation of the Board as a whole; conduct an annual evaluation of the Nominating and Governance Committee; and oversee the evaluation of the other Board committees and provide guidance with respect to the evaluation of management; and
|
| 29 |
|
with the Chairman of the Board and the CEO, periodically review the charter and composition of each Board committee and make recommendations to the Board as to changes in charters, the creation of additional committees;
with the Chairman of the Board and the CEO, recommend to the Board individuals to be chairs and members of Board committees, so that each Board committee is comprised of members with the appropriate qualities, skills and experience for the tasks of the committee; and
oversee our corporate social responsibility programs and goals, and our progress toward achieving those goals.
To the extent not otherwise delegated to the Audit Committee, the Nominating and Governance Committee is also to:
review the relationships between the Companyus and each director, whether direct or as a partner, officer or equity owner of an organization that has a relationship with the Company,us, for conflicts of interest (all members of the Board are required to report any such relationships to the Company’sour General Counsel);
address actual and potential conflicts of interest a Board member may have and issue to the Board member having an actual or potential conflict of interest instructions on how to conduct himself/herself in matters before the Board which may pertain to such an actual or potential conflict of interest; and
make appropriate recommendations to the Board concerning determinations necessary to find a director to be an Independent Director.
The Nominating and Governance Committee periodically reviews and assesses the adequacy of its charter and recommends any proposed changes to the full Board, as necessary to reflect changes in regulatory requirements, authoritative guidance and evolving practices. The Nominating and Governance Committee evaluates its performance at least annually.
The Nominating and Governance Committee met one timetwo times during Fiscal 2019.2022.
Board’s Role in Risk Oversight
Our management is principally responsible for defining, identifying and assessing the various risks facing our Company,we face, formulating enterprise risk management policies and procedures and managing our risk exposures on a day-to-day basis. A risk committee, comprised of senior executives, directs this process. Management provides an annual risk assessment to the Board, with quarterly updates. The Board’s responsibility is to oversee our risk management processes by understanding and evaluating management’s identification, assessment and management of the Company’sour critical risks.
The Board as a whole has responsibility for this risk oversight, assisted by the Audit Committee, the Compensation Committee and the CompensationNominating and Governance Committee. Areas of focus include strategic, operational, liquidity, market, financial, reporting, succession, compensation, compliance, privacy, information security, cybersecurity, business conduct, health and safety, environmental, social, governance and other risks. The Audit Committee is tasked with oversight of financial, reporting and compliance risk management, thealong with our overall risk management program. The Compensation Committee is tasked with oversight of compensation risk management,management. The Nominating and Governance Committee manages risks associated with corporate governance, Board composition, and the performance of the Board, its committees and directors. The Board as a whole oversees all other risk management.
30 | Worthington | 2022 Proxy Statement • Proposal 1: Election of Directors |
|
Review, Approval or Ratification of Transactions with Related Persons
The Company’s policy with respect to related person transactions is addressed in the Company’s written Related Person Transaction Policy (the “Policy”), which supplements the Company’s written Code of Conduct provisions addressing “conflicts of interest”. As described in the Code of Conduct, conflicts of interest can arise when an employee’s or a director’s personal or family relationships, financial affairs, or an outside business involvement or other private interest may adversely influence the judgment or loyalty required for performance of his or her duties to the Company.us. In cases where there is an actual or even the appearance of a conflict of interest, the individual involved is required to notify his or her supervisor or the Company’sour Ethics Officer. The supervisor will then consult with management andor the Ethics Officer, as appropriate. The Code of Conduct provides that any action or transaction in which the personal interest of an executive officer or a director may be in conflict with those of the Companyour interest is to be reported to the Audit Committee. The Audit Committee must investigate and, if it is determined that such action or transaction would constitute a violation of the Code of Conduct, the Audit Committee is authorized to take any action it deems appropriate.
Our written Related Person Transaction Policy (the “Policy”), which supplements the Code of Conduct provisions addressing conflicts of interest, addresses our policy with respect to related person transactions. The Policy was adopted by the Board and is administered by the Audit Committee and the Company’sour General Counsel. The Policy applies to any transaction, arrangement or relationship, or any series of similar transactions, arrangements or relationships, in which: the Company participates,which we participate, directly or indirectly; the amount involved exceeds or is expected to exceed $120,000;indirectly, and a “related person”related person has, had or will have a direct or indirect material interest. Under the Policy, a “related person” is any person:
who is or was anour executive officer, a director or a director nominee, of the Company, or an immediate family member of any such individual; or
who is or was the beneficial owner of more than 5% of the Company’sour outstanding common shares, or an immediate family member of any such individual.
All related person transactions are to be brought to the attention of the Company’s management who will then refer each matter to the Company’sour General Counsel and the Audit Committee. Each director, director nominee or executive officer of the Company must notify the Company’sour General Counsel in writing of any interest that such individual or an immediate family member of such individual has, had or may have, in a related person transaction. In addition, any related person transaction proposed to be entered into by the Companyus must be reported to the Company’sour General Counsel by the employee of the Company who has authority over the transaction. On an annual basis, eachour directors, director director nomineenominees and executive officer of the Companyofficers must complete a questionnaire designed to elicit information about existing and potential related person transactions. Any potential related person transaction that is raised will be analyzed by the Company’sour General Counsel, in consultation with management and with outside counsel, as appropriate, to determine whether the transaction, arrangement or relationship does, in fact, qualify as a related person transaction requiring review by the Audit Committee under the Policy.
Under the Policy, all related person transactions (other than those deemed to be pre-approved or ratified under the terms of the Policy) will be referred to the Audit Committee for approval (or disapproval), ratification, revision or termination. Whenever practicable, a related person transaction is to be reviewed and approved or disapproved by the Audit Committee prior to the effectiveness or consummation of the transaction. If the Company’sour General Counsel determines that advance consideration of a related person transaction is not practicable, the Audit Committee will review and, in its discretion, may ratify the transaction at the Audit Committee’s next meeting. However, the Company’sour General Counsel may present a related person transaction arising between meetings of the Audit Committee to the Chair of the Audit Committee who may review and approve (or disapprove) the transaction, subject to ratification by the Audit Committee at its next meeting if appropriate. If the Company becomeswe become aware of a related person transaction not previously approved under the Policy, the Audit Committee will review the transaction, including the relevant facts and circumstances, at its next meeting and evaluate all options available to the Company,us, including ratification, revision, termination or rescission of the transaction, and take the course of action the Audit Committee deems appropriate under the circumstances.
|
| 31 |
No director may participate in any approval or ratification of a related person transaction in which the director or an immediate family member of the director is involved. The Audit Committee may only approve or ratify those transactions the Audit Committee determines to be in the Company’sour best interest. In making this determination, the Audit Committee will review and consider all relevant information available to it, including:
the terms (including the amount involved) of the transaction and the related person’s interest in the transaction and the amount of that interest;
the business reasons for the transaction and its potential benefits to the Company,us, and whether the transaction was undertaken in the ordinary course of the Company’sour business;
whether the terms of the transaction are fair to the Companyus and no less favorable to the Companyus than terms that could be reached with an unrelated third party;
the impact of the transaction on the related person’s independence; and
whether the transaction would present an improper conflict of interest for any of our directors, director director nomineenominees or executive officer of the Company,officers, taking into account the size of the transaction, the overall financial position of the related person, the direct or indirect nature of the related person’s interest in the transaction and the ongoing nature of any proposed relationship and any other factors the Audit Committee deems relevant.
Any related person transaction previously approved or ratified by the Audit Committee or otherwise already existing that is ongoing in nature is to be reviewed by the Audit Committee annually.
Under the terms of the Policy, the following related person transactions are deemed to be pre-approved or ratified (as appropriate) by the Audit Committee even if the aggregate amount involved would exceed $120,000:
interests arising solely from ownership of the Company’s common shares if all shareholders receive the same benefit on a pro rata basis (i.e., dividends);
compensation to an executive officer, of the Company, as long as the executive officer is not an immediate family member of anotherany of our executive officerofficers or a director of the Companydirectors and the compensation has been approved by the Compensation Committee or is generally available to the Company’sour employees;
compensation to a director for services as a director if the compensation is required to be reported in the Company’sour proxy statements;
interests deriving solely from a related person’s position as a director of another entity that is a party to the transaction;
interests deriving solely from the related person’s direct or indirect ownership of less than 10% of the equity interest (other than a general partnership interest) in another person which is a party to the transaction; and
transactions involving competitive bids.
In addition, the Audit Committee will presume that the following transactions do not involve a material interest:
transactions in the ordinary course of business with an entity for which a related person serves as an executive officer, provided (i) the affected related person did not participate in theour decision of the Company to enter into the transaction, and (ii) the aggregate amount involved in any related category of transactions in a 12-month period is not greater than the least of (a) $1,000,000, or (b) 2% of the other entity’s consolidated gross revenues for such other entity’s most recently completed fiscal year, or (c) 2% of the Company’sour consolidated gross revenues for the Company’sour most recently completed fiscal year;
donations, grants or membership payments to non-profit organizations, provided (a) the affected related person did not participate in theour decision of the Company to make such payments, and (b) the aggregate amount in a 12-month period does not exceed the lesser of $500,000 or 1% of the non-profit organization’s consolidated gross revenues for its most recently completed fiscal year; and
CompanyOur use of facilities (such as dining facilities and clubs) if the charges for such use are consistent with charges paid by unrelated third parties and are fair, reasonable and consistent with those for similar services available forat similar facilities.
32 | Worthington | 2022 Proxy Statement • Transactions With Certain Related Persons |
|
Transactions with Related Persons
The Company isWe are a party to certain agreements relating to the rental of aircraft to and from JMAC, Inc., a private investment company (“JMAC”), which is owned by John P.Mr. McConnell Chairman of the Board and Chief Executive Officer of the Company, and members of his family.family, and JMAC’s subsidiary, JMAC Air, LLC (“JMAC Air”) is owned by JMAC.. Under the agreementagreements with JMAC and JMAC Air, the Companywe may lease aircraft owned by JMAC as needed for a rental fee per flight;flight and under the agreement with the Company, JMAC is allowed tomay lease aircraft operated by the Company,us, on a per-flight basis, when the Company iswe are not using the aircraft. The CompanyWe also makes itsmake our pilots available to JMAC Air, for a per-day charge, to JMAC Air.charge. The rental fees paid to the Companyus under the per-flight rental agreements are set based on Federal Aviation Administration (“FAA”) regulations. The Company believesWe believe the rental fees set in accordance with such FAA regulations for Fiscal 20192022 exceeded the direct operating costs of the aircraft for such flights. Also, based on quotes for similar services provided by unrelated third parties, the Company believeswe believe that the rental rates paid to JMAC are no less favorable to the Companyus than those that could be obtained from unrelated third parties.
For Fiscal 2019, the Company2022, we paid an aggregate amount of $125,296$102,057 under the JMAC Air lease agreement and received $71,653$67,212 for airplane rental and pilot services.
During Fiscal 2019, the Company, either2022, we, directly or indirectly through business expense reimbursement, paid approximately $333,047$282,535 to Double Eagle Club, a private golf club owned by the McConnell family (the “Club”). The Company usesWe use the Club’s facilities for Companycorporate functions and meetings, and for meetings and entertainment for our customers, suppliers and other business associates. Amounts charged to us by the Club to the Company are no less favorable to us than those that are charged to unrelated members of the Club for the same type of use.
During Fiscal 2019, the Company, either2022, we, directly or indirectly through business expense reimbursement, paid approximately $190,330$181,430 to the Columbus Blue Jackets, (“CBJ”), a National Hockey League team of which John P.Mr. McConnell is the majority owner, for suite expenses, game tickets and special event tickets, often used in connection with meetings and entertainment for customers, suppliers and other business associates, at prices no less favorable to us than those charged to third parties. We have also contributed suite use and tickets for charitable purposes.
|
| 33 |
Executive CompensationCompensation
Compensation Discussion and Analysis
Role of the Compensation Committee
The Compensation Committee reviews and administers the compensation for the Chief Executive Officer (the “CEO”)CEO and other members of our executive management of the Company,team, including the named executive officers (the “NEOs”) identified in the “Fiscal 2019 Summary Compensation Table” beginning on page 52 of this Proxy Statement.NEOs. The Compensation Committee also oversees the Company’sour annual incentive plan for executives, long-term incentive program, restricted common share awards, stock option plans, and non-qualified deferred compensation plans. A more detailed discussion of the duties of the Compensation Committee is set forth in the section captioned “PROPOSAL“Proposal 1: ELECTION OF DIRECTORSElection of Directors – Committees of the Board – Compensation Committee” starting on page 27.in this Proxy Statement.
The Compensation Committee is comprised of four directors, each of whom qualifies as an “Independent Director” under the Corporate Governance Guidelines, applicable SEC Rules and applicable NYSE Rules, and is free from any relationship (including disallowed consulting, advisory or other compensatory arrangements) prohibited by applicable laws, rules or regulations or that, in the opinion of the Board, is material to his or her ability to be independent from our management of the Company in connection with the duties of a member of the Compensation Committee or to make independent judgments about the Company’sour executive compensation. Each member also qualifies as an “outside director” for purposes of Section 162(m) of the Internal Revenue Code and as a “non-employee director” for purposes of Rule 16b-3 under the Exchange Act.
The Compensation Committee has sole authority to retain and terminate such compensation consultants, legal counsel and other advisors as the Compensation Committee deems appropriate to fulfill its responsibilities, including sole authority to approve the fees and other terms of retention. The Compensation Committee has retained an independent compensation consultant, Willis Towers Watson, for the purpose of assisting the Compensation Committee in fulfilling its responsibilities, including providing advice on the amount and form of executive and director compensation. Fees paid related to executive and director compensation matters were $58,000$82,000 in Fiscal 2019.2022. Management also periodically retains Willis Towers Watson to provide additional services to the Company,us, including advising on other compensation matters. FeesOur risk management team also separately engaged (in their own discretion, and not at the recommendation or subject to the approval of the Board or the Compensation Committee) an insurance affiliate of Willis Towers Watson to broker liability insurance for these additional servicesus and such affiliate received commissions totaling $150,000, which were $128,000paid by the issuer of the insurance policy. Willis Towers Watson was also separately engaged by our human resources team (in their own discretion, and not at the recommendation or subject to the approval of the Board or the Compensation Committee) to conduct certain due diligence activities in Fiscal 2019, primarilyconnection with our acquisition of Tempel and the fees paid related to assisting the Company with its broad-based compensation structure.that engagement were $240,000. The Compensation Committee has conducted an assessment, which included the consideration of the six factors specified in the NYSE Corporate Governance Standards and SEC Rule 10C-1(b)(4), to evaluate whether the services performed by Willis Towers Watson and the insurance affiliate of Willis Towers Watson raise a conflict of interest or compromise the independence of Willis Towers Watson. Based upon this assessment, the Compensation Committee determined that Willis Towers Watson qualifies as an independent compensation consultant and the work of Willis Towers Watson and its workaffiliates does not raise any conflict of interest.
While the Compensation Committee retains Willis Towers Watson, in carrying out assignments for the Compensation Committee, Willis Towers Watson may interact with the Company’sour management including the Senior Vice President and ChiefPresident-Chief Human Resources Officer, the Senior Vice President-Administration, GeneralPresident-General Counsel and the Vice President and ChiefPresident-Chief Financial Officer and their respective staffs in order to obtain information. In addition, Willis Towers Watson may, in its discretion, seek input and feedback from management regarding its work product prior to presentation to the Compensation Committee in order to confirm information is accurate or address certain issues.
The agendas for the Compensation Committee’s meetings are determined by the Compensation Committee’s Chair with assistance from the CEO, the Senior Vice President and ChiefPresident-Chief Human Resources Officer and the Senior Vice President-Administration, GeneralPresident-General Counsel. These individuals, with input from the Compensation Committee’s compensation consultant, make compensation recommendations for the NEOs and other executive officers. However, decisions regarding the compensation of the NEOs are made solely by the Compensation Committee.
| Worthington | 2022 Proxy Statement |
|
After each regularly scheduled meeting, the Compensation Committee may meet in executive session. When meeting in executive session, the Compensation Committee may have a session with the CEO only, a session with the compensation consultant only, and a session with Compensation Committee members only. The Compensation Committee Chair reports on Compensation Committee actions to the full Board at the following Board meeting.
Stock Ownership Guidelines
In order to further emphasize the stake that the Company’sour directors and senior executives have in fulfilling the goal of building and increasing shareholder value, and to deepen the resolve of executive leadership to fulfill that goal, the Company haswe have established stock ownership guidelines for directors and senior executives.
Stock Ownership Guidelines | |||
| Multiple of base salary or annual cash retainer, as applicable |
| |
| 5 times | ||
Executive |
| 5 times |
|
Directors |
| 5 times |
|
Chief Financial Officer |
| 3.5 times |
|
Chief Operating Officer |
| 3.5 times |
|
Senior Vice Presidents and Business Unit Presidents |
| 2.5 times |
|
Other Senior Executives |
| 1.25 times |
|
For purposes of these guidelines, stock ownership includes common shares held directly or indirectly, common shares held in an executive’s 401(k) plan account(s) and theoretical common shares credited to the bookkeeping account of an executive or a director in one of the Company’sour non-qualified deferred compensation plans.
Under the stock ownership guidelines, once an executive or a director reaches the target ownership level, and so long as those common shares are retained and the individual remains subject to the same guideline level, there is no obligation to purchase additional common shares as a result of fluctuations in the price of the Company’s common shares.
Each covered executive or director is expected to attain the target level of stock ownership within five years from the date he or she is appointed or elected to the position. All directors and executive officers have met their respective target ownership levels, with the exception of two non-NEO executive officers who were appointed to their current positions in the last 1218 months, and Mr. Blom, who became a director in June 2019.
Anti-Hedging Policy
The Company prohibitsWe prohibit our directors, officers (including the NEOs) and other key employees of the Company from engaging in hedging transactions with respect to the common sharesshares. Prohibited hedging transactions include short sales, transactions in publicly-traded options such as puts, calls or similar derivative securities, or financial instruments such as zero cost collars, prepaid variable forward contracts, equity swaps and exchange funds designed to or which have the effect of offsetting a decrease in the value of the Company.common shares. We have not made this anti-hedging policy applicable to our employees in general.
Company Compensation Philosophy
AOur basic philosophy of the Company has long been that employees should have a meaningful portion of their total compensation tied to performance and that the Companywe should use incentives which are intended to drive and reward performance. In furtherance of this philosophy, there is broad-based participation among our full-time, non-union employees of the Company in some form of incentive compensation program. These programs include cash profit sharing programs, which compute payouts based on a fixed percentage of profits, and annual incentive bonus programs that primarily tie bonuses to our aggregate operating results or the operating results of the Companyapplicable segment or the applicable business unit.
The Company has
Executive Compensation • 2022 Proxy Statement | Worthington | 35 |
We have also made broad-based grants of equity awards periodically to a number of salaried employees below the executive level.
|
|
Executive Compensation Philosophy and Objectives
The Company’sOur objectives with respect to executive compensation are to attract and retain highly-qualified executives, to align the interests of management with the interests of shareholders and to provide incentives, based primarily on Companyour performance, for reaching established Company goals and objectives. To achieve these objectives, the Compensation Committee has determined that total compensation for executives will exhibit the following characteristics:
It will be competitive in the aggregate, using broad-based business comparators to gauge the competitive market;
It will be performance-oriented and highly-leveraged, with a substantial portion of the total compensation tied to performance, primarily that of the Companyour performance and/or that of the applicable business unit;
It will align the interests of management and the interests of shareholders; and
It will promote long-term careers at the Company.with us.
The Company’sOur practice has long been that executive compensation be highly leveraged. The Company’sOur compensation program emphasizes performance-based compensation (pay-at-risk) that promotes the achievement of our short-term and long-term Company objectives. The Company believesWe believe it is appropriate to provide a balance between incentives for short-term performance and incentives for long-term profitability of the Company. The Company’sprofitability. Our executive compensation program, therefore, includes both an annual cash incentive bonus program and a long-term incentive compensation program. The CompanyWe also believesbelieve it is appropriate for long-term incentives to have a cash compensation component and an equity-based compensation component, which incentivize executives to drive Companyour performance and align their interests with those of the Company’sour shareholders. The individual components of executive compensation are discussed below.
In fulfilling its responsibilities, the Compensation Committee annually reviews certain market compensation information with the assistance of its independent compensation consultant, Willis Towers Watson, who is directly engaged by the Compensation Committee to prepare the information. This includes information regarding compensation paid to officers with similar responsibilities from a broad-based group of more than 500approximately 700 companies (the “comparator group”). A list of the entities in the comparator group is set forth on Appendix I to this Proxy Statement.
The comparator group is comprised largely of manufacturing companies, maintained in the executive compensation database of Willis Towers Watson at the time the study is conducted, with median revenues of $5.3$4.0 billion. Changes in the comparator group occur as companies begin or cease participation in the database, due to a sale, merger or acquisition of the companies included or for other reasons. The Compensation Committee neither selects nor specifically considers the individual companies which are in the comparator group. For comparison purposes, due to variances in the size of the companies in the comparator group, regression analysis, which is an objective analytical tool used to determine the relationship between data, is used to adjust data.data to better align with our revenue size, which the Compensation Committee set at $4.0 billion for purposes of its analysis. The Compensation Committee believes that using this broad-based comparator group minimizes the effects of changes to the group due to changes in data basedatabase participation, lessens the impact a single entity can have on the overall data, provides more consistent results and better reflects the market in which the Company competeswe compete for executive talent.
During its review process, the Compensation Committee meets directly with its compensation consultant and reviews comparator group information with respect to base salaries, annual cash incentive bonuses and long-term incentive compensation programs. The Compensation Committee considers comparator group information provided by the compensation consultant as an important factor in determining the appropriate levels and mix of executive compensation.
In the past, the Compensation Committee had Willis Towers Watson prepare and review information on a more focused group of companies to assure that compensation information from this group was not significantly different than the information obtained from the broad-based comparator group discussed above. After reviewing this information, the Compensation Committee determined that the results of the two groups were not significantly different. The Compensation Committee continues to believe that the use of a broad-based comparator group provides more consistent information and is preferable for the reasons described above.
|
|
Base salaries of the NEOs and other executivesexecutive officers generally fall below market median comparables developed from the comparator group, although the actual base salaries of the NEOs and other executivesexecutive officers vary from individual to individual and from position to position due to factors such as time in the position, performance, experience, internal equity and other factors the Compensation Committee deems appropriate. Annual cash incentive bonus opportunities to be paid to the NEOs and other executivesexecutive officers for achieving targeted levels of performance are generally above what the compensation consultant considers market median for annual bonuses because base salaries are intentionally set below market median comparables. In setting normal annual long-term incentive compensation opportunities of the NEOs and other executives,executive officers, the Compensation Committee generally starts with the market median developed by the compensation consultant, and then makes adjustments the Compensation Committee deems appropriate.
36 | Worthington | 2022 Proxy Statement • Executive Compensation |
While comparator group information is a factor considered in setting compensation, where a specific NEO’s or other executive’sexecutive officer’s annual cash incentive bonus and long-term incentive compensation fall relative to the market median developed from the comparator group will vary based upon internal equity and other factors listed in the preceding paragraph. Annual cash incentive bonuses and long-term incentive compensation actually paid may vary significantly depending on CompanyCorporate and/or business unit performance during the applicable year(s).
The Compensation Committee uses tally sheets as a tool to assist in its review of executive compensation. These tally sheets contain the components of the CEO’s and other NEOs’ current and historical compensation, including base salary, annual cash incentive bonuses and long-term incentive compensation. These tally sheets and other information provided to the Compensation Committee also show the estimated compensation that would be received by the CEO and other NEOs under certain scenarios, including in connection with a change in control of the Company.
While prior compensation or amounts realized or realizable from prior awards are given some consideration, the Compensation Committee believes that the current and future performance of the Company, its business units and the individual executive officers should be the most significant factors in setting the compensation for the Company’sour executive officers.
The CEO’s performance is annually evaluated by the Compensation Committee and/orand the full Board. The criteria considered include: our overall Company performance; overall leadership; the CEO’s performance in light of, and his development and stewardship of, the Company’s philosophyour Philosophy and itsour current and long-term strategic plans, goals and objectives; development of an effective senior management team; appropriate positioning of the Companyus for future success; and effective communications with the Board and stakeholders. At the request of Mr. McConnell, his base salary and overall compensation have been well below market median levels. The Compensation Committee also evaluates the performance of the other NEOs when annually reviewing and setting executive compensation levels. The criteria considered for the other NEOs are similar to those for the CEO, adjusted to reflect each NEO’s position, with a focus on the applicable business unit for any NEO who is a business unit President.
Compensation Risk Analysis
The Company’sOur executive compensation programs are designed to be balanced, with a focus on both achieving consistent, solid year-over-year financial results and growing shareholder value over the long term. The highest amount of compensation can be attained under these programs, taken as a whole, through consistently strong performance over sustained periods of time. This provides strong incentives for achieving success over the long term and avoiding excessive risk-taking in the short term.
The Company hasWe have long believed that compensation incentives, based primarily upon Companyour earnings or similar performance measures, have played a vital role in the success of the Company.our success. Making profit sharing, bonuses and/or other incentive payments broadly available to all levels of non-union employees has fostered an ownership mentality throughout the workforce which has resulted in long-term employment and a desire to drive consistent financial performance. The Company’sOur culture, aided by this ownership mentality, is focused on striving to continually improve performance and achieve long-term success without engaging in excessive risk-taking.
We do not believe that our compensation incentives encourage excessive risk-taking for the following reasons:
Base salaries are a sufficient componentSalaries provide meaningful base levels of total compensation, minimizing the need for excessive risk-taking.
|
|
|
The long-term cash performance awards and performance share awards are based upon performance over three-fiscal-year periods which mitigates the taking ofrisk that executives would take actions designed to benefit only the short-term risk.and jeopardizing longer-term performance.
In setting targets for annual cash incentive bonuses and long-term incentive compensation, restructuring charges and non-recurring items are eliminated and results are adjusted to eliminate inventory holding gains or losses (where appropriate for the Company or the business unit under consideration), which limit rewards for risky behavior outside the ordinary course of business.
Stock options generally contain a three-year incremental vesting schedule and provide rewards based on the long-term performance of ourthe common shares.
Executive Compensation • 2022 Proxy Statement | Worthington | 37 |
Restricted common share awards generally have a cliff vesting period of three years and further link executive compensation to the long-term value of Worthington’sthe common shares.
The Company’sOur stock ownership guidelines and anti-hedging policy also drive stock ownership among executives, again aligning their interests with the interests of Worthington’sour shareholders and the long-term growth in the value of Worthington’sthe common shares. This is most evident in the shareholdings of CEO,Executive Chairman, John P. McConnell, who is by far Worthington’sour largest shareholder. His potential financial reward for long-term growth in the value of Worthington’sthe common shares far outweighs any short-term compensation he may receive as a result of any excessive short-term risk-taking.
TheIn recent years, the Compensation Committee has granted special performance-based/time-vested restricted common share awards to select NEOs, in recent years.with vesting tied to the price of the common shares attaining certain levels for a ninety consecutive day period during the term of the award. These awards are viewed as particularly appropriate as they are earned by top management only when the Worthingtonour common share price increases significantly and, thus, Worthington’sour shareholders are also significantly benefited. The target price was set at more than 42% above the then all-time high average closing price of Worthington’s common shares for any consecutive thirty- or ninety-day period (as applicable) prior to the applicable grant date. While these awards do require a significant increase in the price of Worthington’sthe common shares to vest, the Compensation Committee believes that the common share price targets for these awards are reasonable targets which can be met with steady consistent growth in the Company’sour performance without the need for any undue risk-taking. The time-based vesting and holding period requirements mitigate the incentive for risky behavior intended to drive only a short-term common share price increase, and instead encourage activity that would lead to steady increases in financial results and a common share price which can be maintained.
Cash Compensation Earned in Fiscal 20192022 and Company Performance
Short-term cash compensation includes base salary and the annual cash incentive bonus paid to the Company’sour executives, including the CEO and the other NEOs. Effective September 2018, base salaries for the NEOs generally increased 3%, with Mr. Rose and Mr. Gilmore receiving larger increases in base salaries effective October 2018 and incentive bonus targeted compensation due to their promotions. Effective November 2018, Mr. Hayek also received an increase in base salary and incentive bonus targeted compensation due to his promotion. Consistent with the Company’sour compensation philosophy, base salaries in Fiscal 20192022 were generally below market median levels for the comparator group.
The Compensation Committee believes the Company has performedthat we have been performing exceptionally well in recent years. Although financial results were downand have responded extremely well to a very challenging environment that included supply chain constraints, steel price volatility, a tight labor market and inflationary cost pressures. Despite these challenges and record performance in Fiscal 2019,2021, we still achieved year-over-year improvements in almost all of our major businesses.
Management has continued to do an outstanding job managing through the Company still posted the third best EPSlingering supply chain, labor and other challenges presented by COVID-19, which in the Company’s history. This followed strong results in Fiscal 2018 and Fiscal 2017, the two better EPS years. Fiscal 2019 was a solid but challenging year driven largelymany cases have been exacerbated by the steel tariffs enactedwar in early 2018. Steel Processing was impacted byUkraine and the fluctuating steel prices, particularly the significant declines latercurrent inflationary environment, and has shown great discipline in the year, which ledexecuting on our strategies. During Fiscal 2022, we also continued to inventory holding losses, created short-term margin pressure and contributed to lower direct shipments in the second half of Fiscal 2019 as customers appeared to delay orders. The fluctuating steel prices also resulted in lower scrap prices in Fiscal 2019 relative to the cost of steel, and this scrap gap had a negative impact on spreads. Pressure Cylinders was also hurt as the increased steel prices and other input costs early in the year reduced margins, but this segment was able to improve pricing and margins as the year went on. In addition, Pressure Cylinders results were negatively impacted by a $13 million charge related to a cylinder replacement program. Management has takentake action to better position ourselves in the Companyfuture. Management remained focused on improving our businesses by investing in new product development and production capacity, and improving efficiencies, all with the aid of transformation and innovation efforts. We and our M&A team added new businesses through acquisitions, focusing on supplying products to the high-growth electric vehicle and electricity infrastructure markets, as well as lightweighting applications for the future. It hasautomotive industry, all of which should contribute to our growth in the coming years.
Consistent with our compensation philosophy, annual incentive compensation earned by our executives continued to move in the direction of our results. Due to our very strong performance, annual cash incentive bonuses for our executives were up for Fiscal 2022, with Corporate paying out at 200% of target, following payouts of 185% of target for Fiscal 2021 and continuesonly 75% of target for Fiscal 2020.
Our financial position remains strong, as we generated a considerable amount of cash from operations in recent years. We were able to take actionpay most of the purchase price for the acquisitions of Shiloh Industries’ U.S. BlankLight® business and Tempel, an aggregate amount of approximately $377.3 million before closing adjustments, from existing cash. Our capital structure is also in a sound position. We have in place $200 million of long-term senior notes due 2032, $250 million of long-term senior notes due 2026, and $150 million of long-term senior notes due 2024. We also have a $500 million revolving credit facility, through August 2026, and a revolving trade accounts receivable securitization facility allowing us to exit non-core, underperforming operations. It remains focused on enhancing growth through transformation, acquisition and innovation, and has taken stepsborrow up to strengthen each$175.0 million. These committed lines of these areas.credit had a total of $518.6 million of borrowing capacity available to be drawn as of July 29, 2022.
| Worthington | 2022 Proxy Statement |
|
We have also been able to reward our shareholders by steadily increasing our quarterly dividend from $0.23 for Fiscal 2019, were down fromto $0.24 for Fiscal 2020, to $0.25 for the strong resultsfirst, second, and third quarters of Fiscal 20182021, to $0.28 for fourth quarter of Fiscal 2021 and each quarter of Fiscal 2017, but Fiscal 2019 was still the third best earnings per share year in the Company’s history. Due2022, and to weaker results, annual cash incentive bonuses for Fiscal 2019 were down as a percentage of targeted bonuses from Fiscal 2018. For Fiscal 2019, Corporate, Steel Processing and Pressure Cylinders annual cash incentive bonuses were paid at 93%, 89% and 82% of target, respectively, after being paid at 106%, 103%, and 104% of target, respectively, for Fiscal 2018.
For Fiscal 2019, the annual cash incentive bonuses earned were calculated by treating the $13 million charge$0.31 for the cylinders replacementfirst quarter of Fiscal 2023. In addition, we continued our stock buy-back program asin Fiscal 2022, repurchasing a non-recurring expense which was excluded in the calculationtotal of Pressure Cylinders operating income and Corporate EPS.
Long-term cash awards earned for the three-fiscal-year period ended Fiscal 2019 were down significantly. Long-term cash and equity payouts for the three-fiscal-year period ended Fiscal 2019 were earned at 48% of target at Corporate, 24% at Steel Processing and 24% at Pressure Cylinders after being paid out at 94% of target at Corporate, 47% at Steel Processing and 47% at Pressure Cylinders for the three-fiscal-year period ended Fiscal 2018. 3,235,000 common shares last year.
The direct relationship of annual cash compensationincentive bonuses earned by the Company’s NEOs to the Company’sour performance has been exemplified by the amount of annual cash incentive bonuses earned bypaid to the NEOs not only in Fiscal 20192022, but also in the prior fiscal years. The following table summarizes results for the last five fiscal years. Effective June 1, 2021, the beginning of Fiscal 2022, we separated our legacy Pressure Cylinders segment into three new segments, Consumer Products, Building Products and Sustainable Energy Solutions.
Year | Performance | Annual Cash Incentive Bonuses |
|
|
|
|
|
|
|
|
|
2018 | Solid year, with the then second best annual EPS results | Annual cash incentive bonuses of executives were paid at 106% of target levels at Corporate, 103% at Steel Processing and 104% at legacy Pressure Cylinders |
2019 |
| Annual cash incentive bonuses of executives were paid at 93% of target levels at Corporate, 89% at Steel Processing and 82% at legacy Pressure Cylinders |
2020 | Results were weakened due to the impact of COVID-19 in the fourth quarter | Annual cash incentive bonuses of executives were paid at 75% of target levels at Corporate, 63% at Steel Processing and 83% at legacy Pressure Cylinders |
2021 | Strong year despite COVID-19 related challenges | Annual cash incentive bonuses of executives were paid at 185% of target levels at Corporate, 183% at Steel Processing and 166% at legacy Pressure Cylinders |
2022 | Very strong year despite COVID-19 and other challenges | Annual cash incentive bonuses of executives were paid at 200% of target levels at Corporate, 200% at Steel Processing, 168% at Consumer Products, 189% at Building Products and 100% at Sustainable Energy Solutions |
|
|
The relationship of incentive compensation earned to Companyour results is also reflected in payments which have been earned under the long-term cash performance and performance share awards. No long-term performance awards were paid for any of the three-fiscal-year performance periods ended with Fiscal 2009, 2010 or 2011. Long-term performance awards were grantedResults for each of the eight three-fiscal-year performance periods since that time. Results for the last five completed three-fiscal-year performance periods are summarized below.
Performance Period (Fiscal Years) | Performance | Results |
|
|
|
|
|
|
|
|
|
2016-2018 | Solid year in Fiscal 2018 | Long-term cash and performance share incentive compensation was earned at 94% of target levels for Corporate executives, and 47% of target levels for Steel Processing and legacy Pressure Cylinders executives |
2017-2019 | Weaker results in Fiscal 2019 | Long-term cash and performance share incentive compensation was earned at 48% of target levels for Corporate executives, and 24% of target levels for Steel Processing and legacy Pressure Cylinders executives |
The Company’s financial position continues to strengthen as the Company has continued to generate a significant amount of cash from operations in recent years. The Company was able to pay most of the purchase price for the AMTROL acquisition, approximately $291.9 million after closing adjustments, out of Company cash generated in Fiscal 2017. The Company’s capital structure is also in a sound position. The Company has in place $200 million of long-term senior notes maturing 2032, $250 million of senior notes maturing 2026, $150 million of senior notes due 2024, and $150 million of senior notes due 2020. The Company also has a $500 million revolving credit facility, through February 2023, which was undrawn as of May 31, 2019.
The Company has also been able to reward its shareholders by steadily increasing its quarterly dividend from $0.13 per share for Fiscal 2013, to $0.15 per share for Fiscal 2014, to $0.18 per share for Fiscal 2015, to $0.19 per share for Fiscal 2016, to $0.20 per share for Fiscal 2017, to $0.21 for Fiscal 2018, to $0.23 for Fiscal 2019, and to $0.24 for the first quarter of Fiscal 2020. In addition, the Company has also continued its stock buy-back program, repurchasing a total of 4,100,000 common shares during Fiscal 2019.
Executive Compensation • 2022 Proxy Statement | Worthington | 39 |
Performance Period (Fiscal Years) | Performance | Results |
2018-2020 | COVID-19 weakened results for Fiscal 2020 negatively affected entire period | No long-term cash or performance share incentive compensation was earned, except for legacy Pressure Cylinders executives who earned 52% of target levels |
2019-2021 | Strong results in Fiscal 2021 lifted results for the entire period | Long-term cash and performance share incentive compensation was earned at 200% of target levels for Corporate executives, 173% of target levels for Steel Processing executives and 144% of target levels for legacy Pressure Cylinders executives |
2020-2022 | Strong results in Fiscal 2021 and Fiscal 2022 lifted results for the entire period | Long-term cash and performance share incentive compensation was earned at 200% of target levels for Corporate executives, 191% of target levels for Steel Processing executives and 200% of target levels for legacy Pressure Cylinders executives |
Say-on-Pay Consideration
At the Company’s 20182021 Annual Meeting, of Shareholders, the Company’sour shareholders approved the executive compensation as disclosed in the proxy statement for that Annual Meeting, with close to 87%over 84% of the common shares represented by those shareholders present in person or represented by proxy at the 20182021 Annual Meeting voting for approval. The vote for approval was over 97%, excluding broker non-votes. The Compensation Committee evaluated the results of this strongly supportive advisory vote, together with the other factors and data discussed in this Compensation Discussion and Analysis, in determining executive compensation policies and making executive compensation decisions.
| Worthington | 2022 Proxy Statement |
|
Compensation Components
Base Salaries
Base salaries for the NEOs and other executive officers are set to reflect the duties and responsibilities inherent in each position, individual levels of experience, performance, market compensation information, internal pay equity, among positions in the Company, and the Compensation Committee’s judgment. The Compensation Committee annually reviews information regarding compensation paid by the comparator group to executive officers with similar responsibilities. It is the Compensation Committee’s intent, in general, to set base salaries below market median levels, with consideration given to the factors listed above, and have total annual cash compensation driven by bonuses.
In June 2019, the Compensation Committee approved a 3% increase in the base salaries of the currently employed NEOs, which will become effective in September 2019.
Annual Bonus Compensation
The NEOs and certain other key employees of the Company participate in the Company’sour annual cash incentive bonus program under which annual bonus awards are tied to attainment of target results. These awards are generally tied to achieving specified levels (threshold, target and maximum) of corporateCorporate and/or business unit performance for the applicable 12-month performance period. The type of performance measured and the weighting of those measurements is shown below. Restructuring charges and non-recurring gains and losses are excluded from all calculations, and the impact of inventory holding gains or losses are factored out in calculating corporateCorporate EPS and Steel Processing business unit EOI.earnings.
For Corporate executives, the goals are tied to corporateCorporate performance.
Payouts are generally tied to achieving specified levels (threshold, target and maximum) of corporateCorporate EVA and corporateCorporate EPS (adjusted(each adjusted as noted above), with each performance measure carrying a 50% weighting.
For Business Unit executives, the goals are tied to both corporateCorporate performance and the performance of their respective business units.
Payouts are generallyhave historically been tied to achieving specified levels (threshold, target and maximum) of adjusted corporateCorporate EPS, 20% weighting; business unit EOI, (adjusted as noted above), 30% weighting; and business unit EVA, 50% weighting.weighting (each adjusted as noted above). For Fiscal 2022 and later, the business unit EOI targets have been changed mainly to business unit EBIT targets (adjusted as noted above).
For performance falling between threshold and target or between target and maximum, the award is linearly pro-rated. If threshold levels are not reached for any performance measure, no bonus will be paid under that performance metric.
The Compensation Committee has also awarded supplemental bonuses at times and for reasons it deems appropriate.
Annual incentive bonuses are paid within a reasonable time following the end of the performance period in cash, unless the Board specifically provides for a different form of payment. In the event of a change in control of the Company, followed by the actual or constructive termination of a participant’s employment during the relevant performance period, the annual cash incentive bonus award of the participant would be considered to be earned at the target level and payable as of the date of actual or constructive termination of employment.
For Fiscal 2019, the annual cash incentive bonuses were calculated by treating the $13 million charge for the cylinder replacement program as a non-recurring expense and thus excluded in the calculation of Pressure Cylinders operating income and Corporate EPS.
The annual cash incentive bonuses forpaid to the NEOs for Fiscal 20192022 were down fromconsistent with Fiscal 2018.2021, due to the strong results in both Fiscal 2022 and Fiscal 2021. Annual cash incentive bonuses for Fiscal 20192022 results were paid at 93%200% of target levels for Corporate executives, 89%200% for Steel Processing executives, 168% for Consumer Products executives, 189% for Building Products executives and 82%100% for Pressure CylinderSustainable Energy Solutions executives. TheAnnual cash incentive bonuses for Fiscal 20182021 were paid at 106%185% of target levels for Corporate executives, 103%183% for Steel Processing executives and 104%166% for legacy Pressure Cylinders executives.
Annual cash incentive bonuses earned by the NEOs for Fiscal 2019,2022, Fiscal 20182021 and Fiscal 2017,2020, are shown in the “Fiscal 20192022 Summary Compensation Table” beginning on page 52 ofin this Proxy Statement in the “Annual Incentive Bonus Award” column within “Non-Equity Incentive Plan Compensation”.
|
|
On June 25, 2019,21, 2022, the Compensation Committee granted annual cash incentive bonus awards to the NEOs for Fiscal 2020.2023. These annual cash incentive bonus awards are shown in the “Annual Cash Incentive Bonus Awards Granted to NEOs for Fiscal 2020”2023” table beginning on page 65 ofin this Proxy Statement.
Executive Compensation • 2022 Proxy Statement | Worthington | 41 |
Long-Term Incentive Compensation
The Compensation Committee has implemented a long-term incentive compensation program for the NEOs and other executives, which consists of:
Stock option grants;
Long-term performance share awards based on achieving measurable financial results over a three-fiscal-year period;
Long-term cash performance awards based on achieving measurable financial results over a three- fiscal-yearthree-fiscal-year period; and
Restricted common share awards.
Long-term performance share awards, long-term cash performance awards, and restricted common share awards are made under the Worthington Industries, Inc. Amended and Restated 1997 Long-Term Incentive Plan (the “1997 LTIP”). Stock options are generally granted out of one of the Company’s stock option plans or under the 1997 LTIP. All of theseour 2010 Stock Option Plan. These plans have been approved by the Company’sour shareholders.
The Compensation Committee added awards of restricted common shares to the long-term incentive program beginning in Fiscal 2012, and somewhat reduced the size of the other long-term incentive awards. Beginning with awards for Fiscal 2014, the Compensation Committee increased the portion of long-term incentive awards made in the form of restricted common shares and correspondingly reduced the portion provided through stock options.
In setting the size of the overall normal long-term incentive compensation awards, the Compensation Committee generally begins by looking at market median values for the comparator group, and then making adjustments for theeach individual for items such as the executive officer’s time in the position, internal equity, performance and such other factors as the Compensation Committee deems appropriate. The percentage of the long-term compensation provided by each type of award (long-term cash performance awards, long-term performance share awards, stock options and restricted common shares) is determined by the Compensation Committee. The value given to stock options for purposes of these awards is determined by the Compensation Committee based on input from its compensation consultant taking into account the anticipated grant date fair value calculated under applicable accounting rules and the stock option values used for recent annual grants. The same is true for restricted common shares, the value of which is generally based on a recent market price of the common shares. Likewise, the value of the long-term performance share awards is generally based upon the number of common shares that can be earned at target, multiplied by a recent common share price. The value used for long-term cash performance awards is generally the amount that can be earned at target. The amount of each type of award granted to an executive officer is determined consistent with the above factors, with the specific amount determined by the Compensation Committee on a subjective basis combining all of the factors considered.
The Compensation Committee believes that using a blend of restricted common share awards, stock option awards, long-term performance share awards and long-term cash performance awards represents a particularly appropriate and balanced method of motivating and rewarding senior executives. Restricted common share awards and stock option awards align the interests of employee recipients with those of shareholders by providing value tied to appreciation in Worthington’sthe common share price. Long-term cash performance awards motivate long-term results because their value is tied to sustained financial achievement over a multiple-year period. Long-term performance share awards blend both of these features because the number of performance shares received is tied to sustained financial achievement over a multiple-year period, and the value of those performance shares is tied to the price of Worthington’sthe common shares. The Compensation Committee believes the combination of these forms of incentive compensation is superior to reliance upon only one form and is consistent with the Company’sour compensation philosophy and objectives.
|
|
The Compensation Committee generally approves annual restricted common share awards, annual stock option grants, and long-term performance share awards and long-term cash performance awards at its June meeting. The stock option grants and restricted common share awards are generally made effective following the meeting and after the Company has reported itswe report earnings for the just-completed fiscal year. Long-term performance share awards and long-term cash performance awards have been based on performance over a three-fiscal-year period beginning with the first day of the first fiscal year in that period. An explanation of the calculation of the compensation expense relative to the equity-based long-term incentive compensation is set forth in the section of this Compensation Discussion and Analysis captioned “Equity-Based Long-Term Incentive Compensation Accounting” beginning on page 47 of this Proxy Statement..
Neither the Company nor the Compensation Committee hasWe have not backdated stock option grants to provide for lower exercise prices, nor have theywe repriced or offered buy-outsbuyouts of underwater stock options. Current plan provisions prohibit such repricing without shareholder consent.
42 | Worthington | 2022 Proxy Statement • Executive Compensation |
Stock Options
Stock options are generally awardedgranted annually to the NEOs and a select group of executive officers.key executives. In practice, the number of common shares covered by ana stock option award generally depends upon the employee’s position and external market data.
As noted above, starting in Fiscal 2014, the Compensation Committee decreased the portion of long-term incentive awards made to the executive group in the form of stock options and increased the portion provided through awards of restricted common shares. The Compensation Committee also authorized grants of restricted common shares to a broader group of key employees, rather than providing stock options. The Compensation Committee made this change to restricted common shares in lieu of stock options based on a number of factors, including that restricted common share awards are less dilutive than stock options having the same grant date fair value and are generally better understood and appreciated by employees.
The following describes the Compensation Committee’s general practice in granting stock options, excluding grants tailored to meet specific circumstances.
Nearly all stock options granted to employees since June 1, 2011 have been non-qualified stock options which vest at a rate of 33% per year and fully vest at the end of three years. In the event an optionee’s employment terminates as a result of retirement, death or total disability, any unexercised stock options outstanding, vested and exercisable on that date will remain exercisable by the optionee or, in the event of death, by the optionee’s beneficiary, until the earlier of either the fixed expiration date, as stated in the applicable stock option award agreement, or 36 months after the last day of employment due to retirement, death or total disability. Should termination occur for any reason other than retirement, death or disability, unexercised stock options are generally forfeited. In the event of a change in control of the Company (as defined in the respective stock option plans or award agreements), followed by an actual or constructive termination of employment, stock options then outstanding will become fully vested and exercisable. The Compensation Committee may allow an optionee to elect, during the 60-day period following a change in control, to surrender a stock option or a portion thereof in exchange for a cash payment equal to the excess of the change in control price per share over the exercise price per share.
Effective June 28, 2018, the Company25, 2021, we made awards of non-qualified stock options to 2926 employees to purchase an aggregate of 87,30054,500 common shares, with an exercise price equal to $42.91,$60.19, the fair market value of the common shares on the grant date. Of those stock options, an aggregate of 62,90031,100 common shares were covered by stock options awardedgranted to the current NEOs. Effective November 1, 2018, the Company made an award of non-qualified stock options to Mr. Hayek, an NEO, to purchase an aggregate of 4,200 common shares, with an exercise price equal to $42.10, the fair market value of the common shares on the grant date. This grant was made in connection to his promotion to CFO.
The stock option grants to the NEOs in Fiscal 20192022 are detailed in the “Grants of Plan-Based Awards for Fiscal 2019”2022” table on page 56 ofin this Proxy Statement. For purposes of the “Grants of Plan-Based Awards for Fiscal 2019”2022” table, stock options are valued based on a grant date fair value and calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“ASC 718”). This value for stock options is also reported in the “Option Awards” column of the “Fiscal 20192022 Summary Compensation Table” beginning on page 52 ofin this Proxy Statement.
Information on stock options granted, effective June 27, 2019,24, 2022, to NEOs for Fiscal 20202023 is set forth in the section captioned “Long-Term Performance Awards, Option Awards and Restricted Common Share Awards Granted to NEOs in Fiscal 2020”, beginning on page 66.2023” in this Proxy Statement.
|
|
Long-Term Performance Awards – General
Since Fiscal 2006, the Company has awardedWe award a select group of key executives, including the NEOs, long-term cash performance awards and long-term performance share awards which are earned based upon results over a prospective three-fiscal-year performance period.
These long-term performance awards are intended to reward executives for achieving pre-established financial goals over a three-fiscal-year period. Restructuring charges and non-recurring items are excluded from all calculations, and corporatethe impact of inventory holding gains or losses are factored out in calculating Corporate EPS and Steel Processing business unit EOI results are adjusted for inventory holding gains or losses.earnings.
For Corporate executives, the goals are tied to corporateCorporate performance.
Payouts are generally tied to achieving specified levels (threshold, target and maximum) of cumulative corporateCorporate EVA and growth in corporateCorporate EPS (adjusted(each adjusted as noted above) over the performance period, with each performance measure carrying a 50% weighting.
For Business Unit executives, the goals are tied to both corporateCorporate performance and the performance of their respective business units.
Cumulative corporatePayouts have historically been tied to achieving specified levels (threshold, target and maximum) of cumulative Corporate EVA and adjusted corporateCorporate EPS growth measures, which together carry a 50% weighting, and business unit EOI targets (each adjusted as noted above), which are weighted 50%. For the three-fiscal-year period beginning with Fiscal 2022, the business unit EOI targets have been changed mainly to business unit EBIT targets (adjusted as noted above) are weighted 50%.
Executive Compensation • 2022 Proxy Statement | Worthington | 43 |
If the performance level falls between threshold and target or between target and maximum, the award is linearly pro-rated. Payouts, if any, would generally be made in the quarter following the end of the applicable performance period. Calculation of Companyour results and the level of attainment of performance measures are made solely by the Compensation Committee based upon the Company’sour consolidated financial statements.
The Compensation Committee determines the appropriate changes and adjustments and may make adjustments for other unusual or non-recurring events, including, without limitation, changes in tax and accounting rules and regulations, extraordinary gains and losses, mergers and acquisitions, and purchases or sales of substantial assets, provided that, if Section 162(m) of the Internal Revenue Code would be applicable to the payout of the award, any such change or adjustment, if not provided for when the targets are set, must be permissible under Section 162(m).assets.
These performance measurements have been chosen because the Compensation Committee believes that:
The corporateCorporate EPS growth metric strongly correlates with the Company’sour growth in equity value;
EOI and EBIT at a business unit tiestie directly into Companyour EPS growth; and
The cumulative corporateCorporate EVA target, which is driven by net operating profit in excess of the cost of capital employed, keeps management focused on the most effective use of existing assets and pursuing only those growth opportunities which provide returns in excess of the cost of capital.
The Company hasWe have used these, or similar performance measures, since long-term cash performance awards were first granted for the performance period ended May 31, 1998.
The Compensation Committee periodically considers whether to change the performance measures used under the incentive awards and reviews the types of measures used by other companies and other relevant information provided by its compensation consultant. TheAs noted above, the Compensation Committee has determined to continue to use thechange certain performance measures set forth above, for the reasons discussed.
Payouts have been made based on the achievement of corporate and business unit executives for the three-fiscal-year performance targets in eachperiod beginning with Fiscal 2022.
As a result of the last eight years. No payments of these awards for corporate performance were made in the three-fiscal-year periods ended Fiscal 2009, Fiscal 2010 or Fiscal 2011, as targets for those three-fiscal-year periods were set prior to the recession which adversely affected results in those three-fiscal-year periods.
|
|
The Company posted solid results in Fiscal 2019, the third best EPS results in the Company’s history, but results were down from thevery strong results in Fiscal 2018 and Fiscal 2017. Payouts made to the executive officers with respect to both2022, long-term cash performance awards and long-term performance share awards fell below 100% of target for the three-fiscal-year period ended with Fiscal 2019. Awards2022 were paid out at 48%200% of target levels for Corporate executives, 24%191% for Steel Processing executives and 24%200% for legacy Pressure Cylinders executives.
Long-Term Cash Performance Awards
Long-term cash performance awards have been part of the long-term performance awards granted to key members of management since they were first awarded in 1998. They are intended to reward executives for achieving pre-established financial goals over a three-fiscal-year period. These long-termLong-term cash performance awards may be paid in cash, common shares or any combination thereof, as determined by the Compensation Committee at the time of payment. To date, earned long-term cash performance awards have been paid in cash. If the performance criteria are met, payouts are generally made in the quarter following the end of the performance period. Nothing is paid under the long-term cash performance awards if none of the three-fiscal-year financial thresholds are met.
Treatment of awards on a change in control or a termination of employment, including termination due to death, disability or retirement, is discussed below in the section captioned “Long-Term Performance Awards – Impact of Termination/Change in Control”. The performance measures for the long-term cash performance awards are discussed above in the section captioned “Long-Term Performance Awards – General”.
Long-term cash performance awards earned for the three-fiscal-year performance period ended May 31, 2019with Fiscal 2022 are described above in the section captioned “Long-Term Performance Awards – General”. The amount of the awards earned by the NEOs for this period is shown in the “Fiscal 20192022 Summary Compensation Table” beginning on page 52 of thein this Proxy Statement under the “3-year Cash Performance Award” column within “Non-Equity Incentive Plan Compensation”. The long-term cash performance awards earned were paid in cash.
Long-term cash performance awards granted in Fiscal 20192022 for the three-fiscal-year performance period ending May 31, 2021with Fiscal 2024 are reported in the “Grants of Plan-Based Awards for Fiscal 2019” table on page 56 of2022” in this Proxy Statement.
Information on long-term cash performance awards granted in Fiscal 20202023 for the three-fiscal-year performance period ending May 31, 2022with Fiscal 2025 is shown in the “Long-Term Performance Awards, Option Awards and Restricted Common Share Awards Granted to NEOs in Fiscal 2020”2023” table beginning on page 66 ofin this Proxy Statement.
44 | Worthington | 2022 Proxy Statement • Executive Compensation |
Long-Term Performance Share Awards
Performance share awards have constituted a portion of the long-term performance awards granted to key members of management since June 2006. They are intended to reward executives for both achieving pre-established financial goals over the three-fiscal-year period and increasing the common share price. The long-term performance share awards are generally paid in common shares and the value is determined not only by the number of common shares earned, but also by the value of the common shares at the time the awards are earned and the common shares are paid out. If the performance criteria are met, payouts are generally made in the quarter following the end of the performance period. Nothing is paid under the long-term performance share awards if none of the three-fiscal-year financial threshold measures are met.
Treatment of awards on a change in control or a termination of employment, including termination due to death, disability or retirement, is discussed below in the section captioned “Long-Term Performance Awards – Impact of Termination/Change in Control”. The performance measures for the long-term performance share awards are discussed above in the section captioned “Long-Term Performance Awards – General”.
Long-term performance share awards earned for the three-fiscal-year performance period ended May 31, 2019,with Fiscal 2022, are described above in the section captioned “Long-Term Performance Awards – General”. The long-term performance share awards earned were paid in common shares.
|
|
Long-term performance share awards granted in Fiscal 20192022 for the three-fiscal-year performance period ending May 31, 2021with Fiscal 2024 are reported in the “Grants of Plan-Based Awards for Fiscal 2019”2022” table on page 56 ofin this Proxy Statement. An explanation of the calculation of the compensation expense relative to those awards is set forth in the section captioned “Equity-Based Long-Term Incentive Compensation Accounting” beginning on page 47 ofsection in this Proxy Statement.Compensation Discussion and Analysis. If the performance criteria are met, the long-term performance shares earned would generally be issued in the quarter following the end of the performance period.
Information on long-term performance share awards granted in Fiscal 20202023 for the three-fiscal-year performance period ending May 31, 2022with Fiscal 2025 is shown in the “Long-Term Performance Awards, Option Awards and Restricted Common Share Awards Granted to NEOs in Fiscal 2020”2023” table beginning on page 66 ofin this Proxy Statement.
Long-Term Performance Awards – Impact of Termination/Change in Control
In general, termination of employment results in termination of long-term cash performance awards and long-term performance share awards. However, if termination is due to death, disability or retirement, a pro rata payout will be made for performance periods ending 24 months or less after termination of employment based on the number of months of employment completed by the participant during the performance period before the effective date of termination, provided that the applicable performance goals are achieved. No payout will be made for performance periods ending more than 24 months after termination of employment. Unless the Compensation Committee specifically provides otherwise at the time of grant, in the event of a change in control of the Company followed by an actual or constructive termination of employment, all long-term cash performance awards and long-term performance share awards would be considered to be earned and payable in full at the maximum level, and immediately settled or distributed.
Annual Restricted Common Share Awards to Executives
Effective June 28, 2018,25, 2021, the Compensation Committee granted annual restricted common share awards to 4144 employees covering an aggregate of 100,275109,300 restricted common shares, which will cliff vest on the third anniversary of the grant date. Of those awards, an aggregate of 59,40055,000 restricted common shares were awarded to the NEOs. Restricted common share awards are intended to reward and incent executives by directly aligning the interests of management with the interests of shareholders. The vesting provision of the restricted common shares also serves as a management retention incentive. For further details with respect to the restricted common share awards granted to the NEOs effective June 28, 2018,25, 2021, see the “Stock Awards” column of the “Fiscal 20192022 Summary Compensation Table” beginning on page 52 ofin this Proxy Statement.
Restricted common share awards to the NEOs in Fiscal 20192022 are detailed in the “Grants of Plan-Based Awards for Fiscal 2019”2022” table on page 56 ofin this Proxy Statement. For purposes of the “Grants of Plan-Based Awards for Fiscal 2019”2022” table, restricted common share awards are valued based on grant date fair value and calculated in accordance with ASC 718. This value for restricted common share awards is also reported in the “Stock Awards” column of the “Fiscal 20192022 Summary Compensation Table” beginning on page 52 ofin this Proxy Statement.
Executive Compensation • 2022 Proxy Statement | Worthington | 45 |
For further details with respect to the restricted common share awards granted to the NEOs effective June 27, 2019,24, 2022, see the “Long-Term Performance Awards, Option Awards and Restricted Common Share Awards Granted to NEOs in Fiscal 2020”2023” table beginning on page 66 ofin this Proxy Statement.
Other Restricted Common Share Awards to NEOs in Fiscal 2022
TheOn June 25, 2021, the Compensation Committee made awards to Mr. Gilmore on September 26, 2018an award of 20,00010,000 restricted common shares to Ms. Lyttle, which will cliff vest on the third anniversary of the grant date and of 30,000 restricted common shares which will cliff vest on the fifth anniversary of the grant date. These awards were made in connection with his promotion to Executive Vice President and Chief Operating Officer (“COO”) of the Company.
In connection with his promotion to Vice President and Chief Financial Officer (“CFO”), the Compensation Committee also made an award of 3,500 restricted common shares to Mr. Hayek on November 1, 2018 which will cliff vest on the third anniversary of the date of grant.
|
|
Other Restricted Common Share Awards to non NEOsnon-NEOs in Fiscal 2022
It has been theour practice of the Company to award restricted common shares to a broader group of employees every two or three years, and to grant restricted common shares to select employees at other times to select employees such as when their employment began or they received a promotion. Such awards provide employees with the opportunity to participate in increases in shareholder value as a result of common share price appreciation, and further the Company’sour objective of aligning the interests of management with the interests of shareholders.
Between August 30, 2018June 24, 2021 and April 30, 2019, the Company27, 2022, we made awards to 19796 employees covering an aggregate of 159,50057,700 restricted common shares, which will cliff vest on the third anniversary of the respective grant date.dates. None of these awards were made to an NEO.
Special Performance-Based/Time-Vested Restricted Common Share AwardAwards
The Compensation Committee has at times granted special “one-off” performance-based/time-vested restricted common share awards to select NEOs,executives, with vesting tied to the price of Worthington’sthe common shares attaining certain levels.levels for a ninety consecutive day period during the term of the award. These awards are viewed as particularly appropriate as they are earned by top management only when the Worthington common share price increases significantly and, thus, Worthington’sour shareholders are also significantly benefited. When granted, the target price was set at more than 42% above the then all-time high average closing price of Worthington’s common shares for any consecutive thirty- or ninety-day period (as applicable) prior to the applicable grant date. While these awards do require a significant increase in the price of Worthington’sthe common shares from that on the grant date in order to vest, the Compensation Committee believes that the common share price targets for these awards are reasonable targets which can be met with steady consistent growth in the Company’sour performance without the need for any undue risk-taking. The time-based vesting and holding period requirements mitigate the incentive for risky behavior intended to drive only a short-term common share price increase, and instead encourage activity that would lead to steady increases in financial results and a common share price which can be maintained.
In Fiscal 2022, no such awards were issued.
In Fiscal 2021, the Compensation Committee made a special award, effective June 25, 2020, of 25,000 performance-based/time-vested restricted common shares to Mr. Gilmore. The term of this restricted common share award is five years and the restricted common shares will vest if and only when both of the following conditions are met: (a) the closing price of the common shares averages $65.00 per share for any 90 consecutive day period during the five-year term; and (b) Mr. Gilmore has remained continuously employed by us through June 25, 2023, or if later, the date the stock price condition is met. The restricted common shares will be forfeited five years from the effective date of the award if the performance-based vesting condition is not met by that date, or as of the date of termination if Mr. Gilmore’s employment is terminated (with certain exceptions discussed below) before June 25, 2023. If Mr. Gilmore’s employment is terminated by us without “cause” or Mr. Gilmore dies or becomes permanently disabled after the performance condition has been met but before the time-based vesting condition has been met, the restricted common shares will be fully vested as of the date of termination. In the case of death or disability of Mr. Gilmore, the Compensation Committee may elect, in its sole discretion, to accelerate the vesting of all or a portion of the restricted common shares.
46 | Worthington | 2022 Proxy Statement • Executive Compensation |
In Fiscal 2020, the Compensation Committee made a special award, effective September 25, 2019, to Mr. Hayek of 50,000 performance-based/time-vested restricted common shares. During Fiscal 2019, in connection with the naming of Mr. Rose as President and Mr. Gilmore as COO,Chief Operating Officer (“COO”), the Compensation Committee made special awards, effective September 26, 2018, of 175,000 performance-based/time-vested restricted common shares to Mr. Rose and of 50,000 performance-based/time-vested restricted common shares to Mr. Gilmore. The term of each of these restricted common share awards is five years from the date of grant and the restricted common shares will vest if and only when both of the following conditions are met: (a) the closing price of the Company’s common shares equals or exceeds $65.00 per share for 90 consecutive days during the five-year term; and (b) the executive officerapplicable NEO has remained continuously employed by the Companyus for five years (i.e., through September 26, 2023).years. The restricted common shares will be forfeited five years from the effective date of the award (i.e., September 26, 2023) if the performance-based vesting condition is not met by that date, or as of the date of termination if the executive officer’sNEO’s employment is terminated (with certain exceptions discussed below) before September 26, 2023.the end of the five-year period. If the applicable NEO’s employment is terminated by the Companyus without “cause” or if the NEOhe dies or becomes permanently disabled after the performance condition has been met but before the time-based vesting condition has been met, the restricted common shares will be fully vested as of the date of termination. In the case of death or disability, the Compensation Committee may elect, in its sole discretion, to accelerate the vesting of all or a portion of thesethe restricted common shares.
The Compensation Committee believes the average or continuous (as applicable) $65.00 per share closing price for 90 consecutive days condition was an appropriate performance target, as its achievement will not only reward the NEO, but also our shareholders in general, as the $65.00 stock price would be a significant increase in the price of the common shares from the price on the grant date. The Compensation Committee believed this to be a reasonable target which can be reached by steady, consistent growth in our performance, without the need for any undue risk-taking.
In the event of a change in control followed by an actual or constructive termination of employment (as defined by the Compensation Committee), thesethe restricted common shares will vest, subject to any Internal Revenue Code Section 280G limitation imposed by the Compensation Committee. For further details on these restricted common share awards granted on September 26, 2018, see the “Grants of Plan-Based Awards for Fiscal 2019” table beginning on page 56 of this Proxy Statement.
Each of Mr. Rose, Mr. Hayek, and Mr. Gilmore has been a key player in driving the Company’sour efforts and financial results, as well as in strategic actions taken by us. The Board (and, with respect to Mr. Hayek and Mr. Gilmore, the Company in recent years. The CEO and the BoardCEO) have identified Mr. Rose, Mr. Hayek and Mr. Gilmore as key executives who have key roles and responsibilities in leading the Companyus forward. The Compensation Committee believes these special restricted common share awards have served, and continue to serve, as a strong retention mechanism that provides a unique incentive to these identified leaders to further enhance the Company’sour success, and directly ties their compensation to the Company’sour first corporate goal of increasing the value of our shareholders’ investment.
|
|
The Compensation Committee believes the $65.00 per share closing price for 90 consecutive days condition to be an appropriate performance target, as its achievement will not only reward Messrs. Rose and Gilmore, but also Worthington’s shareholders in general, as the $65.00 stock price would be more than 42% above the all-time high closing price of Worthington’s common shares for any consecutive 90-day period prior to September 26, 2018. The Compensation Committee believes this to be reasonable target which can be reached by steady, consistent growth in the Company’s performance, without the need for any undue risk-taking.
The Compensation Committee made a special incentive award, effective June 24, 2014, of 25,000 performance-based/time-vested restricted common shares to Mr. Gilmore. The term of this award was five years and the restricted common shares would vest if both: (a) the closing price of Worthington’s common shares equals or exceeds $60.00 per share for 30 consecutive days during the five-year period ending June 24, 2019, and (b) Mr. Gilmore has remained continuously employed by the Company for five years (i.e., through June 24, 2019). In connection with his promotion, on September 25, 2018, the Committee extended the term of the award and employment period requirement to June 24, 2020. The other terms are similar to the awards described above.
Clawback Policy
The Company doesWe do not have a specific compensation clawback policy. If the Company iswe are required to restate itsour earnings as a result of material non-compliance with a financial reporting requirement due to misconduct, under Section 304 of the Sarbanes-Oxley Act of 2002 (“SOX”), the CEO and the CFOour Chief Financial Officer (“CFO”) would be required to reimburse the Companyus for any bonus or other incentive-based or equity-based compensation received by them from the Companyus during the 12-month period following the first filing with the SEC of the financial document that embodied the financial reporting requirement required to be restated, and any profits realized from the sale of the common shares of the Company during that 12-month period, to the extent required by SOX.
On July 1, 2015, the SEC issued proposed rules relating to clawback policies. Oncepolicies and again solicited public comments on the proposed clawback rules in 2021 and 2022. Once final SEC rulesRules have been adopted and the NYSE has, in turn, adopted new listing standards addressing the clawback policy requirements, the Companywe will adopt a clawback policy which satisfies the final rules.SEC Rules and NYSE Rules.
Equity-Based Long-Term Incentive Compensation Accounting
The accounting treatment for equity-based long-term incentive compensation is governed by ASC 718. OptionsStock options are valued using the Black-Scholes pricing model based upon the grant date closing price per common share underlying the stock option award, the expected life of the stock option award, the risk-free interest rate, the dividend yield, and the expected volatility. Further information concerning the valuation of stock options and the assumptions used in that valuation is contained in “Note A – Summary of Significant Accounting Policies – Stock-Based Compensation” and “Note KL – Stock-Based Compensation” of the Notes to Consolidated Financial Statements in “Item 8. – Financial Statements and Supplementary Data” of the Company’s Annual Report on2022 Form 10-K for Fiscal 2019 filed on July 30, 2019 (the “2019 Form 10-K”).10-K.
Executive Compensation • 2022 Proxy Statement | Worthington | 47 |
Long-term performance share awards payable in common shares are initially valued using the grant date closing price per common share based on the target award, and compensation expense is recorded prospectively over the performance period on a straight-line basis. This amount is then adjusted on a quarterly basis based upon an estimate of the performance level anticipated to be achieved for the performance period in light of actual and forecasted results.
Long-term cash performance awards are initially valued at the target level, and compensation expense is recorded prospectively over the performance period on a straight-line basis. This amount is then adjusted on a quarterly basis based on an estimate of the performance level anticipated to be achieved for the performance period in light of actual and forecasted results.
Restricted common shares are valued at fair value as of the date of grant and the calculated compensation expense is recognized on a straight-line basis over their respective vesting periods. For restricted common shares with only time-based vesting, fair value is generally equal to the closing price of the common shares at the respective grant date. If the vesting is subject to other conditions, such as the special performance-based/time-vested restricted common share awards, the value is generally calculated under a Monte Carlo simulation model. Further information concerning the valuation of restricted common shares and the assumptions used in that valuation is contained in “Note A – Summary of Significant Accounting Policies – Stock-Based Compensation” and “Note KL – Stock-Based Compensation” of the Notes to Consolidated Financial Statements in “Item 8. – Financial Statements and Supplementary Data” of the Company’s 20192022 Form 10-K.
|
|
The NEOs participate in the Worthington Industries, Inc. Deferred Profit Sharing Plan (the “DPSP”), together with most of our other full-time, non-union employees of the Company.employees. The DPSP is a 401(k) plan and is the Company’sour primary retirement plan. Contributions made by the Companyus to participants’ accounts under the DPSP are generally based on 3% of eligible compensation which includes base salary, profit sharing, bonus and annual cash incentive bonus payments, overtime and commissions, up to the maximum limit set by the Internal Revenue Service (“IRS”) from year to year ($280,000305,000 for calendar 2019)2022). In addition, the NEOs and other participants in the DPSP may elect to make voluntary contributions up to prescribed IRS limits. These voluntary contributions are generally matched by Company contributionsour contribution of 50% of the first 4% of eligible compensation contributed by the participant. Distributions under the DPSP are generally deferred until retirement, death or total and permanent disability.
Non-Qualified Deferred Compensation
The NEOs and other highly-compensated employees are eligible to participate in the Worthington Industries, Inc. Amended and Restated 2005 Non-Qualified Deferred Compensation Plan (as amended, the “2005 NQ Plan”). The 2005 NQ Plan is a voluntary, non-tax qualified,non-tax-qualified, unfunded deferred compensation plan available only to select highly-compensated employees for the purpose of providing deferred compensation, and thus potential tax benefits, to these employees.
Under the 2005 NQ Plan, our executive officers of the Company may defer the payment of up to 50% of their base salary and up to 100% of their bonus and/or annual cash incentive bonus awards. Amounts deferred are credited to the participants’ bookkeeping accounts under the 2005 NQ Plan at the time the base salary and/or bonus/annual cash incentive bonus awards would have otherwise been paid. In addition, the Companywe may make discretionary employer contributions to the participants’ bookkeeping accounts in the 2005 NQ Plan. In recent years, the Company haswe have made employer contributions in order to provide the same percentage of retirement-related deferred compensation to executive officers compared to other employees that would have been made but for the IRS limits on annual compensation that may be considered under the DPSP. For the 2019, 20182022, 2021 and 20172020 calendar years, the Companywe made contributions to the 2005 NQ Plan for participants equal to (i) 3% of an executive’s annual compensation (base salary plus bonus/annual cash incentive bonus award) in excess of the IRS maximum; and (ii) a matching contribution of 50% of the first 4% of annual compensation contributed by the executive to the DPSP to the extent not matched by the Companyus under the DPSP. Participants in the 2005 NQ Plan may elect to have their bookkeeping accounts treated as invested (a) with a rate of return reflecting: (i) the returns on those investment options available under the DPSP; or (ii) a fixed interest rate set annually by the Compensation Committee (2.48%(0.85% for Fiscal 2019)2022), or (b) in theoretical common shares reflecting increases or decreases in the fair market value of Worthington’sthe common shares with dividends deemed reinvested. Any portion of a participant’s bookkeeping account credited to theoretical common shares must remain credited to theoretical common shares until distributed. Otherwise, participants in the 2005 NQ Plan may change the investment options for their bookkeeping accounts as of the time permitted under the DPSP for the same or a similar investment option.
48 | Worthington | 2022 Proxy Statement • Executive Compensation |
Employees’ bookkeeping accounts in the 2005 NQ Plan are fully vested. Payouts of amounts credited to theoretical common shares are made in whole common shares and cash in lieu of fractional shares. Payouts of amounts credited to all other investment options are made in cash. Payments will be made as of a specified date selected by the participant or, subject to the timing requirements of Section 409A of the Internal Revenue Code, when the participant is no longer employed by the Company.us. Payments are made either in a lump sum or in installment payments,installments, all as chosen by the participant at the time the deferral is elected. The Compensation Committee may permit hardship withdrawals from a participant’s account under defined guidelines.
Contributions or deferrals for the period before January 1, 2005, are maintained under the Worthington Industries, Inc. Non-Qualified Deferred Compensation Plan, effective March 1, 2000 (as amended, the “2000 NQ Plan”). Contributions and deferrals for periods on or after January 1, 2005 are maintained under the 2005 NQ Plan, which was adopted to replace the 2000 NQ Plan in order to comply with the provisions of the then newly-adopted Section 409A of the Internal Revenue Code applicable to non-qualified deferred compensation plans. Among other things, the provisions of Section 409A generally are more restrictive with respect to the timing of deferral elections and the ability of participants to change the time and manner in which accounts will be paid. The 2005 NQ Plan and the 2000 NQ Plan are collectively referred to as the “Employee Deferral Plans”.
|
|
Perquisites
The Company makes club membershipsWe make a Club membership available to NEOs and certain other executives because it believeswe believe that such memberships can be useful for business entertainment purposes. In 2007, the Company elected to no longer provide executives with leased Company vehicles and generally eliminated leased Company vehicles for all employees unless a substantial portion of their business time involves travel, as is the case with those individuals in outside sales.
For security and safety reasons, the NEOs occasionally use Companyour airplanes for personal travel.travel, and due to COVID-19, such usage has increased during the last 30 months. In such cases, the NEOs who use Companyour airplanes for personal usetravel are charged an amount equal to the standard industry fare level, or SIFL rate, set forth in the regulations promulgated by the United States Department of the Treasury (“Treasury Regulations”), which is generally less than the Company’sour incremental costs.
Other Company Benefits
The Company providesWe provide employees, including the NEOs, with a variety of other employee welfare benefits including medical benefits, disability benefits, life insurance, and accidental death and dismemberment insurance, which are generally provided to employees on a Company-wide basis.all full-time, non-union employees.
Change in Control
The Company hasWe have no formal employment contracts or other stand-alone change in control provisions relative to the NEOs or other top executives. It doesWe have certain change in control provisions in its variousour compensation plans, as described below.
The Company’sOur stock option plans generally provide that, unless the Board or the Compensation Committee provides otherwise, upon a change in control of the Company followed by an actual or constructive termination of employment, all stock options then outstanding will become fully vested and exercisable. In addition, the Compensation Committee may allow the optionee to elect, during the 60-day period from and after the change in control, to surrender the stock options or a portion thereof in exchange for a cash payment equal to the excess of the change in control price per share over the exercise price per share.
For purposes of the Company’sour stock option plans (the 1997 LTIP the Amended and Restated 2003 Stock Option Plan (the “2003 Stock Option Plan”) and the 2010 Stock Option Plan), a change in control will be deemed to have occurred when any person, alone or together with itssuch person’s affiliates or associates, has acquired or obtained the right to acquire the beneficial ownership of 25% or more of the Company’sour outstanding common shares, unless such person is: (a) the Company; (b) any of our employee benefit plan of the Companyplans or a trustee of or fiduciary with respect to any such plan when acting in that capacity; or (c) any person who, on the date the applicable plan became effective, was an affiliate of the Companyours owning in excess of 10% of Worthington’sour outstanding common shares and the respective successors, executors, legal representatives, heirs and legal assigns of such person (an “Acquiring Person Event”). In addition, in the case of stock options granted under the 2003 Stock Option Plan and the 2010 Stock Option Plan, a change in control will also be deemed to have occurred if there is a change in the composition of the Board with the effect that a majority of the directors are not “continuing directors” (as defined in each plan).
Executive Compensation • 2022 Proxy Statement | Worthington | 49 |
If a change in control followed by an actual or constructive termination of employment had occurred as of May 31, 2019, there would have been no then-current2022, the value associated withof the unvested stock options which would have vested upon the change in control (based upon (a) the difference, if any, between (i) the closing market price of Worthington’sthe common shares on May 31, 20192022 (the last business day of Fiscal 2022) ($34.14),46.64) and (ii) the per share exercise price of each such stock option, multiplied by (b) the number of common shares subject to the unvested portion of each such stock option), because, infor each case,of the per share exercise price exceeded $34.14.NEOs would have totaled:
NEO | Value of Unvested Stock Options If Vesting Accelerated |
B. Andrew Rose | $210,848 |
Joseph B. Hayek | $82,894 |
Geoffrey G. Gilmore | $115,096 |
John P. McConnell | $142,075 |
Catherine M. Lyttle | $49,267 |
Long-term cash performance awards and long-term performance share awards generally provide that, unless the Board or the Compensation Committee provides otherwise, upon a change in control of the Company followed by an actual or constructive termination of employment, all such awards would be considered earned and payable in full at the maximum amounts and would be immediately settled or distributed. For purposes of the 1997 LTIP (under which the long-term cash performance awards and long-term performance share awards have been granted), a change in control will be deemed to have occurred when there is an Acquiring Person Event as defined above.
|
|
If a change in control followed by an actual or constructive termination of employment had occurred as of May 31, 2019,2022, the aggregate value of the long-term cash performance awards and the number of common shares underlying long-term performance share awards, which would have been distributed to each of the NEOs would have totaled:
NEO | Long-Term Cash Performance Awards |
|
| Long-Term Performance Share Awards |
| Long-Term Cash Performance Awards |
| Long-Term Performance Share Awards | ||||
B. Andrew Rose |
| $7,333,332 |
| 85,866 | ||||||||
Joseph B. Hayek |
| $2,346,666 |
| 28,334 | ||||||||
Geoffrey G. Gilmore |
| $2,906,668 |
| 35,666 | ||||||||
John P. McConnell |
| $ | 6,000,000 |
|
|
| 78,000 |
|
| $4,800,000 |
| 42,600 |
Joseph B. Hayek |
| $ | 1,156,110 |
|
|
| 12,532 |
| ||||
B. Andrew Rose |
| $ | 3,600,000 |
|
|
| 41,000 |
| ||||
Geoffrey G. Gilmore |
| $ | 1,980,000 |
|
|
| 27,600 |
| ||||
Virgil L. Winland |
| $ | 1,380,000 |
|
|
| 14,050 |
| ||||
Dale T. Brinkman |
| $ | 1,200,000 |
|
|
| 14,050 |
| ||||
Mark A. Russell |
| $ | 1,333,332 |
|
|
| 15,890 |
| ||||
John G. Lamprinakos |
| $ | 672,222 |
|
|
| 9,822 |
| ||||
Catherine M. Lyttle |
| $1,225,334 |
| 15,600 |
Each of the NEOs received time-vested restricted common share awards granted effective June 28, 2018,25, 2021, June 29, 2017,25, 2020, and June 30, 2016.27, 2019. In addition, Ms. Lyttle received an additional time-vested restricted common share award on June 25, 2021; Mr. Hayek received two additional time-vested restricted common share awards on September 25, 2019; and Mr. Gilmore received an additional time-vested restricted common share award on September 26, 2018. All of these restricted common share awards provide that upon a change in control followed by an actual or constructive termination of employment, the restricted common shares will vest and the restrictions will lapse. If a change in control followed by an actual or constructive termination of employment had occurred as of May 31, 2019,2022, the number of time-vested restricted common shares (and accrued dividends on those common shares) that would have vested and been distributable to each of the NEOs as of such date are set forth below. The closing price of the common shares on May 31, 2019,2022, the last business day of Fiscal 2022, was $34.14.$46.64.
NEO |
| # of Restricted Common Shares |
|
| Accrued Dividends |
|
| # of Restricted Common Shares |
| Accrued Dividends | ||
B. Andrew Rose |
| 67,200 |
| $105,048 | ||||||||
Joseph B. Hayek |
| 69,100 |
| $165,045 | ||||||||
Geoffrey G. Gilmore |
| 56,100 |
| $156,387 | ||||||||
John P. McConnell |
|
| 62,500 |
|
| $ | 96,825 |
|
| 31,900 |
| $81,253 |
Joseph B. Hayek |
|
| 12,700 |
|
| $ | 17,118 |
| ||||
B. Andrew Rose |
|
| 32,000 |
|
| $ | 50,160 |
| ||||
Geoffrey G. Gilmore |
|
| 96,000 |
|
| $ | 94,320 |
| ||||
Virgil L. Winland |
|
| 10,400 |
|
| $ | 16,180 |
| ||||
Dale T. Brinkman |
|
| 10,400 |
|
| $ | 16,180 |
| ||||
Mark A. Russell |
|
| 0 |
|
| $ | 0 |
| ||||
John G. Lamprinakos |
|
| 0 |
|
| $ | 0 |
| ||||
Catherine M. Lyttle |
| 21,300 |
| $30,405 |
50 | Worthington | 2022 Proxy Statement • Executive Compensation |
The special performance-based/time-vested restricted common share awards granted to Mr. Rose on September 26, 2018, to Mr. Hayek on September 25, 2019 and to Mr. Gilmore on June 24, 201425, 2020 and September 26, 2018 also provide that upon a change in control followed by an actual or constructive termination of employment, the restricted common shares will vest and the restrictions will lapse. If a change in control followed by an actual or constructive termination of employment had occurred as of May 31, 2019,2022, the number of performance-based/time-vested restricted common shares, and accrued dividends on those common shares, that would have vested and been distributable as of such date are set forth below. The closing price of the common shares on May 31, 2019,2022, the last business day of Fiscal 2022, was $34.14$46.64.
NEO |
| # of Restricted Common Shares |
|
| Accrued Dividends |
|
| # of Restricted Common Shares |
| Accrued Dividends | ||
B. Andrew Rose |
|
| 175,000 |
|
| $ | 80,500 |
|
| 175,000 |
| $616,000 |
Joseph B. Hayek |
| 50,000 |
| $129,500 | ||||||||
Geoffrey G. Gilmore |
|
| 75,000 |
|
| $ | 118,250 |
|
| 75,000 |
| $222,750 |
John P. McConnell |
| 0 |
| $0 | ||||||||
Catherine M. Lyttle |
| 0 |
| $0 |
|
|
Annual cash incentive bonus awards provide that if during a performance period, (a) a change in control of the Company (as defined in the plan) occurs and (b) the participant’s employment with the Companyus actually or constructively terminates on or after the change in control, the participant’s award would be considered earned and payable as of the date of the participant’s actual or constructive termination of employment in the amount designated as target for such award and would be settled or distributed following the date of the participant’s actual or constructive termination of employment. The target amounts for annual cash incentive bonus awards granted to the NEOs for the 12-month performance period ended May 31, 2019,2022, are shown in the “Grants of Plan-Based Awards for Fiscal 2019”2022” table on page 56 ofin this Proxy Statement.
Under the Employee Deferral Plans, participants’ bookkeeping accounts will generally be paid out as of the date of the change in control. See the “Non-Qualified Deferred Compensation for Fiscal 2019”2022” table on page 64 ofin this Proxy Statement for further information.
The Compensation Committee believes that these change in control provisions are appropriate, and well within market norms, particularly because the Company haswe have no formal employment contracts or other formal stand-alone change in control provisions relative to the NEOs or other executives.
Tax Deductibility
Section 162(m) of the Internal Revenue Code generally limits the deduction that the Companywe may take for certain remuneration paid in excess of $1,000,000 to any “covered employee” of the Company in any one taxable year. Before January 1, 2018, Section 162(m) of the Internal Revenue Code only appliedapplies to the Company’s CEO, as well as the CFO and each of our three other most highly compensated officers of the Company (not including the Company’sCEO and the CFO). Beginning January 1, 2018, Section 162(m) of the Internal Revenue Code now also applies to the CFO and any person who has been the CEO, the CFO, or one of the other three most highly compensated officers of the Company in any year beginning after December 31, 2016. Prior to January 1, 2018, compensation which qualified as “qualified performance-based compensation” within the meaning of Section 162(m) of the Internal Revenue Code and the related Treasury Regulations was not taken into account in determining whether this $1,000,000 deduction limitation has been exceeded. Subject to certain grandfathering provisions, there will no longer be an exclusion for “qualified performance-based compensation”. Awards granted under the Company’s stock option plans generally qualified as “qualified performance-based compensation” under Section 162(m) of the Internal Revenue Code and restricted common shares with vesting tied to performance measures also generally qualified. The Compensation Committee tailored the long-term incentive compensation awards granted under the 1997 LTIP (except for restricted common share awards which do not have a performance-based vesting requirement) and the awards granted to executive officers under the Company’s annual cash incentive bonus program to qualify as incentive-based compensation. This qualification will not be relevant for awards granted after January 1, 2018.
The Compensation Committee intends to continue to examine the best method to pay incentive compensation to executive officers, which will include consideration of theany changes to Section 162(m) of the Internal Revenue Code. In all cases, whether or not some portion of a covered employee’s compensation is tax deductible, the Compensation Committee will continue to carefully consider the net cost and value of our compensation policies to the Company of its compensation policies.us.
Executive Compensation • 2022 Proxy Statement | Worthington | 51 |
The Compensation Committee has reviewed the Compensation Discussion and Analysis (the “CD&A”) contained in this Proxy Statement and discussed the CD&A with management. Based upon such review and discussion, the Compensation Committee recommended to the full Board, and the full Board approved, that the CD&A be included in this Proxy Statement and incorporated by reference into the 20192022 Form 10-K.
The foregoing report is provided by the Compensation Committee of the Board.
|
| Compensation Committee |
|
|
|
|
| John B. Blystone, Chair |
|
| Kerrii B. Anderson |
|
| Michael J. Endres |
|
| Ozey K. Horton, Jr. |
| Worthington | 2022 Proxy Statement |
|
Fiscal 2019 Summary2022 Summary Compensation Table
The following table lists, for each of Fiscal 2019,2022, Fiscal 20182021 and Fiscal 2017,2020, the compensation of the Company’sour NEOs (i.e., our CEO, the two individuals who served as the Company’s CFO, at any time during Fiscal 2019, and the Company’s three other most highly compensated executive officers serving in executive officer positions at the end of Fiscal 2019, as well as two individuals who served as executive officers during Fiscal 2019 but retired and were no longer serving in executive officer positions at the end of Fiscal 2019 (collectively, all such individuals are referred to as the “NEOs")2022).
Fiscal 20192022 Summary Compensation Table
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Non-Equity Incentive Plan Compensation |
|
|
|
|
|
|
|
| ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Short-Term / Long-Term |
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
Name and Principal Positions During Fiscal 2019 | Fiscal Year |
| Salary ($) (1) |
| Discretionary Bonuses ($) (1) |
| Stock Awards ($) (2) |
| Option Awards ($) (3) |
| Annual Incentive Bonus Award ($) (1) |
| 3-year Cash Performance Award ($) (4) |
| All Other Compensation ($) (5) |
| Total ($) | ||||||||||||||||||||||||||||||||||
John P. McConnell, |
| 2019 |
|
|
|
| 667,780 |
|
|
|
|
|
|
|
|
|
|
| 1,373,120 |
|
|
|
|
| 276,100 |
|
|
|
|
| 877,722 |
|
|
|
|
| 484,000 |
|
|
|
|
| 60,111 |
|
|
|
|
| 3,738,834 |
|
|
Chairman of the Board |
| 2018 |
|
|
|
| 661,008 |
|
|
|
|
|
|
|
|
|
|
| 1,471,080 |
|
|
|
|
| 329,780 |
|
|
|
|
| 970,766 |
|
|
|
|
| 935,000 |
|
|
|
|
| 60,608 |
|
|
|
|
| 4,428,241 |
|
|
and Chief Executive Officer |
| 2017 |
|
|
|
| 646,226 |
|
|
|
|
|
|
|
|
|
|
| 1,625,400 |
|
|
|
|
| 307,400 |
|
|
|
|
| 1,015,127 |
|
|
|
|
| 923,000 |
|
|
|
|
| 67,465 |
|
|
|
|
| 4,584,618 |
|
|
Joseph B. Hayek, |
| 2019 |
|
|
|
| 298,727 |
|
|
|
|
|
|
|
|
|
|
| 329,838 |
|
|
|
|
| 67,224 |
|
|
|
|
| 291,288 |
|
|
|
|
| 55,909 |
| (7) |
|
|
| 38,822 |
|
|
|
|
| 1,081,878 |
|
|
Vice President and |
| 2018 |
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
| ||||||||
Chief Financial Officer (6) |
| 2017 |
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
| ||||||||
B. Andrew Rose, |
| 2019 |
|
|
|
| 527,103 |
|
|
|
|
|
|
|
|
|
|
| 4,799,515 |
|
|
|
|
| 144,325 |
|
|
|
|
| 657,547 |
|
|
|
|
| 290,400 |
|
|
|
|
| 80,533 |
|
|
|
|
| 6,499,422 |
|
|
President and Former |
| 2018 |
|
|
|
| 502,212 |
|
|
|
|
|
|
|
|
|
|
| 757,035 |
|
|
|
|
| 172,385 |
|
|
|
|
| 632,236 |
|
|
|
|
| 561,000 |
|
|
|
|
| 73,608 |
|
|
|
|
| 2,698,476 |
|
|
Chief Financial Officer (8) |
| 2017 |
|
|
|
| 488,655 |
|
|
|
|
|
|
|
|
|
|
| 844,425 |
|
|
|
|
| 156,600 |
|
|
|
|
| 661,127 |
|
|
|
|
| 553,800 |
|
|
|
|
| 51,165 |
|
|
|
|
| 2,755,772 |
|
|
Geoffrey G. Gilmore, |
| 2019 |
|
|
|
| 520,837 |
|
|
|
|
|
|
|
|
|
|
| 4,022,219 |
|
|
|
|
| 80,320 |
|
|
|
|
| 557,266 |
|
|
|
|
| 161,700 |
| (7) |
|
|
| 52,740 |
|
|
|
|
| 5,395,081 |
|
|
Executive Vice President |
| 2018 |
|
|
|
| 500,125 |
|
|
|
|
|
|
|
|
|
|
| 1,693,596 |
|
|
|
|
| 95,936 |
|
|
|
|
| 525,672 |
|
|
|
|
| 149,600 |
|
|
|
|
| 39,942 |
|
|
|
|
| 3,004,962 |
|
|
and Chief Operating Officer (9) |
| 2017 |
|
|
|
| 481,212 |
|
|
|
|
| 52,320 |
|
|
|
|
| 562,950 |
|
|
|
|
| 87,000 |
|
|
|
|
| 427,680 |
|
|
|
|
| 143,065 |
|
|
|
|
| 38,771 |
|
|
|
|
| 1,792,998 |
|
|
Virgil L. Winland, |
| 2019 |
|
|
|
| 378,595 |
|
|
|
|
|
|
|
|
|
|
| 236,005 |
|
|
|
|
| 37,650 |
|
|
|
|
| 445,896 |
|
|
|
|
| 111,320 |
|
|
|
|
| 47,243 |
|
|
|
|
| 1,256,709 |
|
|
Senior Vice President, |
| 2018 |
|
|
|
| 374,755 |
|
|
|
|
|
|
|
|
|
|
| 252,186 |
|
|
|
|
| 44,970 |
|
|
|
|
| 493,164 |
|
|
|
|
| 215,050 |
|
|
|
|
| 37,166 |
|
|
|
|
| 1,417,291 |
|
|
Manufacturing |
| 2017 |
|
|
|
| 366,607 |
|
|
|
|
|
|
|
|
|
|
| 278,629 |
|
|
|
|
| 46,400 |
|
|
|
|
| 515,700 |
|
|
|
|
| 212,290 |
|
|
|
|
| 33,595 |
|
|
|
|
| 1,453,220 |
|
|
Dale T. Brinkman, |
| 2019 |
|
|
|
| 396,731 |
|
|
|
|
|
|
|
|
|
|
| 236,005 |
|
|
|
|
| 31,375 |
|
|
|
|
| 396,352 |
|
|
|
|
| 96,800 |
|
|
|
|
| 35,991 |
|
|
|
|
| 1,193,254 |
|
|
Senior Vice President-Administration, |
| 2018 |
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
| ||||||||
General Counsel and Secretary (10) |
| 2017 |
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
|
| N/A |
|
| ||||||||
Mark A. Russell, |
| 2019 |
|
|
| 130,759 |
|
|
|
|
|
|
|
|
|
|
| 708,015 |
|
|
|
|
| 144,325 |
|
|
|
|
| — |
|
|
|
|
| 209,733 |
|
|
|
|
| 1,169,885 |
|
|
|
|
| 2,362,717 |
|
| |
Former President and |
| 2018 |
|
|
|
| 555,606 |
|
|
|
|
|
|
|
|
|
|
| 757,035 |
|
|
|
|
| 172,385 |
|
|
|
|
| 767,144 |
|
|
|
|
| 561,000 |
|
|
|
|
| 69,137 |
|
|
|
|
| 2,882,307 |
|
|
Chief Operating Officer (11) |
| 2017 |
|
|
|
| 540,613 |
|
|
|
|
|
|
|
|
|
|
| 844,525 |
|
|
|
|
| 156,000 |
|
|
|
|
| 802,200 |
|
|
|
|
| 553,800 |
|
|
|
|
| 60,432 |
|
|
|
|
| 2,958,070 |
|
|
John G. Lamprinakos, |
| 2019 |
|
|
|
| 132,548 |
|
|
|
|
|
|
|
|
|
|
| 377,608 |
|
|
|
|
| 60,240 |
|
|
|
|
|
|
|
|
|
|
| 51,761 |
|
|
|
|
| 888,601 |
|
|
|
|
| 1,510,758 |
|
|
Former President, The |
| 2018 |
|
|
|
| 363,327 |
|
|
|
|
|
|
|
|
|
|
| 402,639 |
|
|
|
|
| 71,952 |
|
|
|
|
| 386,625 |
|
|
|
|
| 124,667 |
|
|
|
|
| 40,175 |
|
|
|
|
| 1,389,384 |
|
|
Worthington Steel Company (12) |
| 2017 |
|
|
|
| 320,642 |
|
|
|
|
|
|
|
|
|
|
| 873,882 |
|
|
|
|
| 66,120 |
|
|
|
|
| 415,040 |
|
|
|
|
| 119,221 |
|
|
|
|
| 25,737 |
|
|
|
|
| 1,820,642 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Non-Equity Incentive Plan Compensation |
|
|
|
|
|
|
|
| ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Short-Term / Long-Term |
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
Name and Principal Position(s) During Fiscal 2022 | Fiscal Year |
| Salary ($) (1) |
| Discretionary Bonus ($) (1) |
| Stock Awards ($) (2) |
| Option Awards ($) (3) |
| Annual Incentive Bonus Award ($) (1) |
| 3-year Cash Performance Award ($) (4) |
| All Other Compensation ($) (5) |
| Total ($) | ||||||||||||||||||||||||||||||||||
B. Andrew Rose, |
| 2022 |
|
|
|
| 668,038 |
|
|
|
|
| 0 |
|
|
|
|
| 2,533,999 |
|
|
|
|
| 333,944 |
|
|
|
|
| 1,860,000 |
|
|
|
|
| 2,000,000 |
|
|
|
|
| 141,943 |
|
|
|
|
| 7,537,925 |
|
|
President and Chief |
| 2021 |
|
|
|
| 646,304 |
|
|
|
|
| 0 |
|
|
|
|
| 1,462,428 |
|
|
|
|
| 282,960 |
|
|
|
|
| 1,665,450 |
|
|
|
|
| 1,466,666 |
|
|
|
|
| 98,165 |
|
|
|
|
| 5,621,973 |
|
|
Executive Officer |
| 2020 |
|
|
|
| 562,692 |
|
|
|
|
| 0 |
|
|
|
|
| 758,745 |
|
|
|
|
| 143,360 |
|
|
|
|
| 580,920 |
|
|
|
|
| 0 |
|
|
|
|
| 88,716 |
|
|
|
|
| 2,134,433 |
|
|
Joseph B. Hayek, |
| 2022 |
|
|
|
| 441,519 |
|
|
|
|
| 0 |
|
|
|
|
| 517,634 |
|
|
|
|
| 104,728 |
|
|
|
|
| 1,100,000 |
|
|
|
|
| 706,666 |
|
|
|
|
| 105,014 |
|
|
|
|
| 2,975,561 |
|
|
Vice President and |
| 2021 |
|
|
|
| 395,457 |
|
|
|
|
| 495,000 |
|
|
|
|
| 520,713 |
|
|
|
|
| 105,848 |
|
|
|
|
| 915,998 |
|
|
|
|
| 613,334 |
|
|
|
|
| 58,211 |
|
|
|
|
| 3,104,561 |
|
|
Chief Financial Officer |
| 2020 |
|
|
|
| 322,269 |
|
|
|
|
| 0 |
|
|
|
|
| 2,847,190 |
|
|
|
|
| 69,632 |
|
|
|
|
| 298,206 |
|
|
|
|
| 18,364 |
|
|
|
|
| 54,377 |
|
|
|
|
| 3,610,038 |
|
|
Geoffrey G. Gilmore, |
| 2022 |
|
|
|
| 630,669 |
|
|
|
|
| 0 |
|
|
|
|
| 601,900 |
|
|
|
|
| 122,512 |
|
|
|
|
| 1,550,001 |
|
|
|
|
| 946,668 |
|
|
|
|
| 109,721 |
|
|
|
|
| 3,961,471 |
|
|
Executive Vice President |
| 2021 |
|
|
|
| 614,312 |
|
|
|
|
| 748,000 |
|
|
|
|
| 1,230,806 |
|
|
|
|
| 144,624 |
|
|
|
|
| 1,384,174 |
|
|
|
|
| 824,683 |
|
|
|
|
| 86,010 |
|
|
|
|
| 5,032,609 |
|
|
and Chief Operating Officer |
| 2020 |
|
|
|
| 552,462 |
|
|
|
|
| 0 |
|
|
|
|
| 552,522 |
|
|
|
|
| 102,400 |
|
|
|
|
| 511,210 |
|
|
|
|
| 71,294 |
|
|
|
|
| 68,179 |
|
|
|
|
| 1,858,067 |
|
|
John P. McConnell, |
| 2022 |
|
|
|
| 410,861 |
|
|
|
|
| 0 |
|
|
|
|
| 0 |
|
|
|
|
| 0 |
|
|
|
|
| 824,000 |
|
|
|
|
| 3,320,600 |
|
|
|
|
| 48,902 |
|
|
|
|
| 4,604,364 |
|
|
Executive Chairman |
| 2021 |
|
|
|
| 487,797 |
|
|
|
|
| 400,000 |
|
|
|
|
| 579,801 |
|
|
|
|
| 117,376 |
|
|
|
|
| 740,200 |
|
|
|
|
| 3,474,080 |
|
|
|
|
| 48,383 |
|
|
|
|
| 5,847,637 |
|
|
|
| 2020 |
|
|
|
| 698,715 |
|
|
|
|
| 0 |
|
|
|
|
| 1,459,125 |
|
|
|
|
| 276,480 |
|
|
|
|
| 727,890 |
|
|
|
|
| 0 |
|
|
|
|
| 58,142 |
|
|
|
|
| 3,220,352 |
|
|
Catherine M. Lyttle, Senior Vice President and Chief Human Resources Officer (6) |
| 2022 |
|
|
|
| 361,558 |
|
|
|
|
| 0 |
|
|
|
|
| 860,717 |
|
|
|
|
| 53,352 |
|
|
|
|
| 725,120 |
|
|
|
|
| 395,334 |
|
|
|
|
| 55,455 |
|
|
|
|
| 2,451,536 |
|
|
(1) | The amounts shown in these columns include that portion of salaries, discretionary bonuses and annual incentive bonus awards the NEOs elected to defer pursuant to the DPSP or the 2005 NQ Plan. Amounts deferred pursuant to the 2005 NQ Plan in Fiscal |
|
|
|
| Fiscal 2019 |
| Fiscal 2018 |
| Fiscal 2017 | |||||||||||
John P. McConnell: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term performance share award (a) |
| $ | 514,920 |
|
|
|
| $ | 515,880 |
|
|
|
| $ | 673,650 |
|
|
Annual time-vested restricted share award (b) |
| $ | 858,200 |
|
|
|
| $ | 955,200 |
|
|
|
| $ | 951,750 |
|
|
Joseph B. Hayek: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term performance share award (a) |
| $ | 130,996 |
|
|
|
| N/A |
|
|
|
| N/A |
|
| ||
Annual time-vested restricted share award (b) |
| $ | 51,492 |
|
|
|
| N/A |
|
|
|
| N/A |
|
| ||
Special time-vested restricted share award (c) |
| $ | 147,350 |
|
|
|
| N/A |
|
|
|
| N/A |
|
| ||
B. Andrew Rose: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term performance share award (a) |
| $ | 278,915 |
|
|
|
| $ | 279,435 |
|
|
|
| $ | 336,825 |
|
|
Annual time-vested restricted share award (b) |
| $ | 429,100 |
|
|
|
| $ | 477,600 |
|
|
|
| $ | 507,600 |
|
|
Special performance-based/restricted share award (d) |
| $ | 4,091,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Geoffrey G. Gilmore: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term performance share award (a) |
| $ | 188,804 |
|
|
|
| $ | 189,156 |
|
|
|
| $ | 224,500 |
|
|
Annual time-vested restricted share award (b) |
| $ | 278,915 |
|
|
|
| $ | 310,440 |
|
|
|
| $ | 338,400 |
|
|
Special time-vested restricted share award (c) |
| $ | 2,125,000 |
|
|
|
| $ | 1,194,000 |
|
|
|
|
|
|
|
|
Special performance-based/restricted share award (d) |
| $ | 1,169,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Modified performance-based restricted share award (e) |
| $ | 260,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Virgil L. Winland: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term performance share award (a) |
| $ | 94,402 |
|
|
|
| $ | 94,578 |
|
|
|
| $ | 117,889 |
|
|
Annual time-vested restricted share award (b) |
| $ | 141,603 |
|
|
|
| $ | 157,608 |
|
|
|
| $ | 160,740 |
|
|
Dale T. Brinkman: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term performance share award (a) |
| $ | 94,402 |
|
|
|
| N/A |
|
|
|
| N/A |
|
| ||
Annual time-vested restricted share award (b) |
| $ | 141,603 |
|
|
|
| N/A |
|
|
|
| N/A |
|
| ||
Mark A. Russell: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term performance share award (a) |
| $ | 278,915 |
|
|
|
| $ | 279,435 |
|
|
|
| $ | 336,825 |
|
|
Annual time-vested restricted share award (b) |
| $ | 429,100 |
|
|
|
| $ | 477,600 |
|
|
|
| $ | 507,600 |
|
|
John G. Lamprinakos: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term performance share award (a) |
| $ | 158,767 |
|
|
|
| $ | 159,063 |
|
|
|
| $ | 188,622 |
|
|
Annual time-vested restricted share award (b) |
| $ | 218,841 |
|
|
|
| $ | 243,576 |
|
|
|
| $ | 685,260 |
|
|
|
| Fiscal 2022 |
| Fiscal 2021 |
| Fiscal 2020 | |||||||||||
B. Andrew Rose: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term performance share award (a) |
| $ | 656,071 |
|
|
|
| $ | 576,108 |
|
|
|
| $ | 291,825 |
|
|
Annual time-vested restricted common share award (b) |
| $ | 1,877,928 |
|
|
|
| $ | 886,320 |
|
|
|
| $ | 466,920 |
|
|
Joseph B. Hayek: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term performance share award (a) |
| $ | 204,646 |
|
|
|
| $ | 206,808 |
|
|
|
| $ | 140,076 |
|
|
Annual time-vested restricted common share award (b) |
| $ | 312,988 |
|
|
|
| $ | 313,905 |
|
|
|
| $ | 210,114 |
|
|
Special time-vested restricted common share award (c) |
| $ | 0 |
|
|
|
| $ | 0 |
|
|
|
| $ | 1,781,500 |
|
|
Special performance-based/time-vested restricted common share award (d) |
| $ | 0 |
|
|
|
| $ | 0 |
|
|
|
| $ | 715,500 |
|
|
Geoffrey G. Gilmore: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term performance share award (a) |
| $ | 240,760 |
|
|
|
| $ | 280,668 |
|
|
|
| $ | 221,787 |
|
|
Annual time-vested restricted common share award (b) |
| $ | 361,140 |
|
|
|
| $ | 428,388 |
|
|
|
| $ | 330,735 |
|
|
Special performance-based/time-vested restricted common share award (e) |
| $ | 0 |
|
|
|
| $ | 521,750 |
|
|
|
| $ | 0 |
|
|
John P. McConnell: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term performance share award (a) |
| $ | 0 |
|
|
|
| $ | 232,659 |
|
|
|
| $ | 583,650 |
|
|
Annual time-vested restricted common share award (b) |
| $ | 0 |
|
|
|
| $ | 347,142 |
|
|
|
| $ | 875,475 |
|
|
Catherine M. Lyttle: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term performance share award (a) |
| $ | 102,323 |
|
|
|
| N/A |
|
|
|
| N/A |
|
| ||
Annual time-vested restricted common share award (b) |
| $ | 156,494 |
|
|
|
| N/A |
|
|
|
| N/A |
|
| ||
Special time-vested restricted common share award (f) |
| $ | 601,900 |
|
|
|
| N/A |
|
|
|
| N/A |
|
|
Executive Compensation • 2022 Proxy Statement | Worthington | 53 |
| (b) | The amounts for the annual time-vested restricted common share awards are computed in accordance with ASC 718 as of the date the awards were granted. These amounts were calculated by multiplying the number of restricted common shares granted by the closing price of the common shares on the date of the grant which for Fiscal |
| (c) | Mr. |
(d) | Mr. Hayek received a special performance-based/time-vested 50,000 restricted common share award effective September 25, 2019. The grant date fair value was $14.31 per common share, determined using the Monte Carlo simulation model. This performance-based/time-vested restricted common share award for Fiscal 2020 is described in the section captioned “Executive Compensation — Compensation Discussion and Analysis — Compensation Components — Special Performance-Based/Time-Vested Restricted Common Share Awards” in this Proxy Statement. |
(e) | Mr. Gilmore received a special performance-based/time-vested 25,000 restricted common share award effective June 25, 2020. The grant date fair value was $20.87 per common share, determined using the Monte Carlo simulation model. This performance-based/time-vested restricted common share award for Fiscal 2021 is described in the section captioned “Executive Compensation — Compensation Discussion and Analysis — Compensation Components — Special Performance-Based/Time-Vested Restricted Common Share Awards” in this Proxy Statement. |
Mr. Gilmore also(f) Ms. Lyttle received a special time-vested 25,000 restricted common share award effective June 29, 2017. The terms of this award are substantially the same as those of the annual time-vested restricted common share awards described in footnote (b) above, but these restricted common shares will cliff vest on the fourth anniversary of the grant date. The amount shown was calculated as described in footnote (b), with a $47.76 closing share price of Worthington’s common shares on the date of the grant.
|
|
Mr. Hayek received a special time-vested 3,500 restricted common share award effective November 1, 201825, 2021 with a three-year cliff vesting period. The terms of this award are otherwise substantially the same as those of the annual time-vested restricted common share awards described in footnote (b) above. The amount shown was calculated as described in footnote (b) but with a $42.10$60.19 closing common share price on the date of the grant.
The special time-vested restricted common share awards granted in Fiscal 2019 are described in the section captioned “EXECUTIVE COMPENSATION – Compensation Discussion and Analysis —Compensation Components — Other Restricted Common Share Awards to NEOs” on page 45 of this Proxy Statement. The “Grants of Plan-Based Awards for Fiscal 2019” table on page 56 of this Proxy Statement provides information on the special time-vested restricted common shares granted in Fiscal 2019.
|
|
|
|
(3) | The amounts shown in this column represent the aggregate grant date fair values of the stock option awards granted to the NEOs in Fiscal |
(4) | The amounts shown in this column reflect the long-term cash performance awards earned by the NEOs for the three-fiscal-year performance periods ended |
(5) | The following table describes each component of the “All Other Compensation” column for |
All Other Compensation Table
Name |
| Fiscal Year |
| Company Contributions to DPSP (the Company’s 401(k) Plan) ($) (a) |
| Company Contributions to 2005 NQ Plan ($) (b) |
| Group Term Life Insurance Premium Paid ($) (c) |
| Perquisites ($) (d) | Other ($) (e) |
| Company Contributions under DPSP (401(k) Plan) ($) (a) |
| Company Contributions under 2005 NQ Plan ($) (b) |
| Group Term Life Insurance Premium Paid ($) (c) |
| Perquisites ($) (d) (e) | |||||||||||||||||||||||||||||||
|
| 2019 |
|
|
| 14,000 |
|
|
|
| 44,698 |
|
|
|
| 1,413 |
|
|
|
|
| N/A |
|
| N/A | |||||||||||||||||||||||||
B. Andrew Rose |
|
| 15,471 |
|
|
|
| 101,619 |
|
|
|
|
| 1,341 |
|
|
|
|
|
| 23,512 |
|
| |||||||||||||||||||||||||||
Joseph B. Hayek |
|
| 15,322 |
|
|
|
| 45,862 |
|
|
|
|
| 1,341 |
|
|
|
|
|
| 42,489 |
|
| |||||||||||||||||||||||||||
Geoffrey G. Gilmore |
|
| 14,904 |
|
|
|
| 55,353 |
|
|
|
|
| 1,341 |
|
|
|
|
|
| 38,123 |
|
| |||||||||||||||||||||||||||
John P. McConnell |
| 2018 |
|
|
| 13,750 |
|
|
|
| 45,445 |
|
|
|
|
| 1,413 |
|
|
|
|
| N/A |
|
| N/A |
|
| 14,731 |
|
|
|
| 32,831 |
|
|
|
|
| 1,341 |
|
|
|
|
| * |
|
| ||
|
| 2017 |
|
|
| 13,500 |
|
|
|
| 41,876 |
|
|
|
|
| 1,429 |
|
|
|
|
| 10,661 |
|
| N/A | ||||||||||||||||||||||||
|
| 2019 |
|
|
| 14,368 |
|
|
|
| 12,876 |
|
|
|
|
| 1,413 |
|
|
|
|
|
| 10,165 |
|
| N/A | |||||||||||||||||||||||
Joseph B. Hayek |
| 2018 |
|
| N/A |
|
|
| N/A |
|
|
|
| N/A |
|
|
|
|
| N/A |
|
| N/A | |||||||||||||||||||||||||||
|
| 2017 |
|
| N/A |
|
|
| N/A |
|
|
|
| N/A |
|
|
|
|
| N/A |
|
| N/A | |||||||||||||||||||||||||||
|
| 2019 |
|
|
| 14,728 |
|
|
|
| 43,582 |
|
|
|
|
| 1,413 |
|
|
|
|
|
| 20,810 |
|
| N/A | |||||||||||||||||||||||
B. Andrew Rose |
| 2018 |
|
|
| 13,810 |
|
|
|
| 44,237 |
|
|
|
|
| 1,413 |
|
|
|
|
| 14,148 |
|
| N/A | ||||||||||||||||||||||||
|
| 2017 |
|
|
| 13,453 |
|
|
|
| 36,283 |
|
|
|
|
| 1,429 |
|
|
|
|
| N/A |
|
| N/A | ||||||||||||||||||||||||
|
| 2019 |
|
|
| 14,512 |
|
|
|
| 26,650 |
|
|
|
| 1,413 |
|
|
|
|
|
| 10,165 |
|
| N/A | ||||||||||||||||||||||||
Geoffrey G. Gilmore |
| 2018 |
|
|
| 14,008 |
|
|
|
| 24,522 |
|
|
|
|
| 1,413 |
|
|
|
|
| N/A |
|
| N/A | ||||||||||||||||||||||||
|
| 2017 |
|
|
| 14,414 |
|
|
|
| 22,929 |
|
|
|
|
| 1,429 |
|
|
|
|
| N/A |
|
| N/A | ||||||||||||||||||||||||
|
| 2019 |
|
|
| 13,989 |
|
|
|
| 21,677 |
|
|
|
| 1,413 |
|
|
|
|
|
| 10,165 |
|
| N/A | ||||||||||||||||||||||||
Virgil L. Winland |
| 2018 |
|
|
| 13,732 |
|
|
|
| 22,021 |
|
|
|
|
| 1,413 |
|
|
|
|
| N/A |
|
| N/A | ||||||||||||||||||||||||
|
| 2017 |
|
|
| 13,475 |
|
|
|
| 18,691 |
|
|
|
|
| 1,429 |
|
|
|
|
| N/A |
|
| N/A | ||||||||||||||||||||||||
|
| 2019 |
|
|
| 14,000 |
|
|
|
| 20,578 |
|
|
|
|
| 1,413 |
|
|
|
|
| N/A |
|
| N/A | ||||||||||||||||||||||||
Dale T. Brinkman |
| 2018 |
|
| N/A |
|
|
| N/A |
|
|
|
| N/A |
|
|
|
|
| N/A |
|
| N/A | |||||||||||||||||||||||||||
|
| 2017 |
|
| N/A |
|
|
| N/A |
|
|
|
| N/A |
|
|
|
|
| N/A |
|
| N/A | |||||||||||||||||||||||||||
|
| 2019 |
|
|
| 3,139 |
|
|
|
| - |
|
|
|
| 1,413 |
|
|
|
|
| N/A |
|
| 1,165,333 | |||||||||||||||||||||||||
Mark A. Russell |
| 2018 |
|
|
| 13,809 |
|
|
|
| 53,915 |
|
|
|
|
| 1,413 |
|
|
|
|
| N/A |
|
| N/A | ||||||||||||||||||||||||
|
| 2017 |
|
|
| 13,452 |
|
|
|
| 45,552 |
|
|
|
|
| 1,429 |
|
|
|
|
| N/A |
|
| N/A | ||||||||||||||||||||||||
|
| 2019 |
|
|
| 5,817 |
|
|
| 0 |
|
|
|
|
| 1,413 |
|
|
|
|
| N/A |
|
| 881,371 | |||||||||||||||||||||||||
John G. Lamprinakos |
| 2018 |
|
|
| 14,663 |
|
|
|
| 24,098 |
|
|
|
|
| 1,413 |
|
|
|
|
| N/A |
|
| N/A | ||||||||||||||||||||||||
|
| 2017 |
|
|
| 14,329 |
|
|
|
| 9,979 |
|
|
|
|
| 1,429 |
|
|
|
|
| N/A |
|
| N/A | ||||||||||||||||||||||||
Catherine M. Lyttle |
|
| 14,703 |
|
|
|
| 28,711 |
|
|
|
|
| 1,341 |
|
|
|
|
|
| 10,700 |
|
|
| (a) |
|
| (b) |
|
| (c) | The amounts in this column represent the dollar value of the group term life insurance premiums paid by |
|
|
business and personal use. Such membership dues and similar fees amounted to |
| (e) | The |
(6) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Worthington | 2022 Proxy Statement |
|
The following table provides information about the equity and non-equity awards granted to the NEOs in Fiscal 2019:2022:
Grants of Plan-Based Awards for Fiscal 20192022
|
|
|
| Estimated Future Payouts Under Non-Equity Incentive Plan Awards |
|
| Estimated Future Payouts Under Equity Incentive Plan Awards (8) |
| All Other Stock Awards: | All Other Option Awards: Number of | Exercise or Base | Grant Date |
|
|
| Estimated Future Payouts Under Non-Equity Incentive Plan Awards |
| Estimated Future Payouts Under Equity Incentive Plan Awards (5) |
| All Other Stock Awards: | All Other Option Awards: Number of | Exercise or Base | Grant Date | |||||||||||||||||||||||||||||||||
Name | Grant Date | Compensation Committee Approval Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (# of Common Shares) | Target (# of Common Shares) | Maximum (# of Common Shares) | Number of Shares of Stock or Units | Common Shares Underlying Options (9) | Price of Option Awards ($/Share) | Fair Value of Stock and Option Awards ($) | Grant Date | Compensation Committee Approval Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (# of Common Shares) | Target (# of Common Shares) | Maximum (# of Common Shares) | Number of Shares of Stock or Units | Common Shares Underlying Options (6) | Price of Option Awards ($/Share) | Fair Value of Stock and Option Awards ($) | ||||||||||||||||||||||||||||||||
| 6/01/2018 | 6/26/2018 | (1) |
| 469,873 |
|
|
| 939,746 |
|
|
| 1,879,492 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
| 6/01/2018 | 6/26/2018 | (2) |
| 500,000 |
|
|
| 1,000,000 |
|
|
| 2,000,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
John P. McConnell | 6/01/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
| 6,000 |
| 12,000 |
| 24,000 |
|
|
|
|
|
|
|
|
|
| 514,920 |
|
| |||||||||||||||||||||||
| 6/28/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 22,000 |
| 42.91 |
|
| 276,100 |
|
| |||||||||||||||||||||||
B. Andrew Rose | 6/25/2021 | 6/22/2021 | (1) | 465,000 |
| 930,000 |
| 1,860,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||||||||||
| 6/28/2018 | 6/26/2018 | (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 20,000 |
|
|
|
|
|
|
| 858,200 |
|
| 6/25/2021 | 6/22/2021 | (2) | 700,000 |
| 1,400,000 |
| 2,800,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| 6/01/2018 | 6/26/2018 | (1) |
| 162,247 |
|
| 324.493 |
|
|
| 648,986 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6/25/2021 | 6/22/2021 |
|
|
|
|
|
|
| 5,450 |
| 10,900 |
| 21,800 |
|
|
|
|
| 60.19 |
| 656,071 |
| |
| 6/01/2018 | 6/26/2018 | (2) |
| 37,500 |
|
|
| 75,000 |
|
|
| 150,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6/25/2021 | 6/22/2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 16,900 |
| 19.76 |
| 333,944 |
|
| 11/01/2018 | 11/01/2018 | (2) |
| 102,500 |
|
|
| 205,000 |
|
|
| 410,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6/25/2021 | 6/22/2021 | (3) |
|
|
|
|
|
|
|
|
|
|
|
| 31,200 |
|
|
| 60.19 |
| 1,877,928 |
|
Joseph B. Hayek | 6/01/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
| 300 |
| 600 |
| 1,200 |
|
|
|
|
|
|
|
|
|
| 25,746 |
|
| 6/25/2021 | 6/22/2021 | (1) | 275,000 |
| 550,000 |
| 1,100,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 11/01/2018 | 11/01/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
| 1,250 |
| 2,500 |
| 5,000 |
|
|
|
|
|
|
|
|
|
| 105,250 |
|
| 6/25/2021 | 6/22/2021 | (2) | 210,000 |
| 420,000 |
| 840,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6/28/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,200 |
| 42.91 |
|
| 15,060 |
|
| 6/25/2021 | 6/22/2021 |
|
|
|
|
|
|
| 1,700 |
| 3,400 |
| 6,800 |
|
|
|
|
| 60.19 |
| 204,646 |
|
| 11/01/2018 | 11/01/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 4,200 |
| 42.10 |
|
| 52,164 |
|
| 6/25/2021 | 6/22/2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 5,300 |
| 19.76 |
| 104,728 |
|
| 6/28/2018 | 6/26/2018 | (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,200 |
|
|
|
|
|
|
| 51,492 |
|
| 6/25/2021 | 6/22/2021 | (3) |
|
|
|
|
|
|
|
|
|
|
|
| 5,200 |
|
|
| 60.19 |
| 312,988 |
| |
Geoffrey G. Gilmore | 6/25/2021 | 6/22/2021 | (1) | 387,500 |
| 775,000 |
| 1,550,001 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||||||||||
| 11/01/2018 | 11/01/2018 | (4) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,500 |
|
|
|
|
|
|
| 147,350 |
|
| 6/25/2021 | 6/22/2021 | (2) | 245,000 |
| 490,000 |
| 980,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| 6/01/2018 | 6/26/2018 | (1) |
| 352,006 |
|
|
| 704,011 |
|
|
| 1,408,022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6/25/2021 | 6/22/2021 |
|
|
|
|
|
|
| 2,000 |
| 4,000 |
| 8,000 |
|
|
|
|
| 60.19 |
| 240,760 |
|
| 6/01/2018 | 6/26/2018 | (2) |
| 300,000 |
|
|
| 600,000 |
|
|
| 1,200,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6/25/2021 | 6/22/2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6,200 |
| 19.76 |
| 122,512 |
|
B. Andrew Rose | 6/01/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
| 3,250 |
| 6,500 |
| 13,000 |
|
|
|
|
|
|
|
|
|
| 278,915 |
|
| |||||||||||||||||||||||
| 6/25/2021 | 6/22/2021 | (3) |
|
|
|
|
|
|
|
|
|
|
|
| 6,000 |
|
|
| 60.19 |
| 361,140 |
| |||||||||||||||||||||||||||||||||
John P. McConnell | 6/25/2021 | 6/22/2021 | (1) | 206,000 |
| 412,000 |
| 824,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||||||||||
| 6/25/2021 | 6/22/2021 | (2) | 500,000 |
| 1,000,000 |
| 2,000,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||||||||||
Catherine M. Lyttle | 6/25/2021 | 6/22/2021 | (1) | 181,280 |
| 362,560 |
| 725,120 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||||||||||
| 6/28/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 11,500 |
| 42.91 |
|
| 144,325 |
|
| 6/25/2021 | 6/22/2021 | (2) | 105,000 |
| 210,000 |
| 420,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6/28/2018 | 6/26/2018 | (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 10,000 |
|
|
|
|
|
|
| 429,100 |
|
| 6/25/2021 | 6/22/2021 |
|
|
|
|
|
|
| 850 |
| 1,700 |
| 3,400 |
|
|
|
|
| 60.19 |
| 102,323 |
| |
| 9/26/2018 | 9/25/2018 | (5) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 175,000 |
|
|
|
|
|
|
| 4,091,500 |
|
| 6/25/2021 | 6/22/2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2,700 |
| 19.76 |
| 53,352 |
| |
| 6/01/2018 | 6/26/2018 | (1) |
| 306,250 |
|
|
| 613,040 |
|
|
| 1,226,080 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6/25/2021 | 6/22/2021 | (3) |
|
|
|
|
|
|
|
|
|
|
|
| 2,600 |
|
|
| 60.19 |
| 156,494 |
|
| 6/01/2018 | 6/26/2018 | (2) |
| 215,417 |
|
|
| 430,833 |
|
|
| 861,666 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6/25/2021 | 6/22/2021 | (4) |
|
|
|
|
|
|
|
|
|
|
|
| 10,000 |
|
|
| 60.19 |
| 601,900 |
|
| 6/01/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
| 2,200 |
| 4,400 |
| 8,800 |
|
|
|
|
|
|
|
|
|
| 188,804 |
|
| |||||||||||||||||||||||
Geoffrey G. Gilmore | 6/28/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6,400 |
| 42.91 |
|
| 80,320 |
|
| |||||||||||||||||||||||
| 6/28/2018 | 6/26/2018 | (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6,500 |
|
|
|
|
|
|
| 278,915 |
|
| ||||||||||||||||||||||||
| 9/26/2018 | 9/25/2018 | (5) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 50,000 |
|
|
|
|
|
|
| 1,169,000 |
|
| ||||||||||||||||||||||||
| 9/26/2018 | 9/25/2018 | (6) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 50,000 |
|
|
|
|
|
|
| 2,125,000 |
|
| ||||||||||||||||||||||||
|
|
| (7) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 25,000 |
|
|
|
|
|
|
| 260,500 |
|
| ||||||||||||||||||||||||
| 6/01/2018 | 6/26/2018 | (1) |
| 238,702 |
|
|
| 477,405 |
|
|
| 954,809 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
| 6/01/2018 | 6/26/2018 | (2) |
| 115,000 |
|
|
| 230,000 |
|
|
| 460,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
Virgil L. Winland | 6/01/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
| 1,100 |
| 2,200 |
| 4,400 |
|
|
|
|
|
|
|
|
|
| 94,402 |
|
| |||||||||||||||||||||||
| 6/28/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,000 |
| 42.91 |
|
| 37,650 |
|
| |||||||||||||||||||||||
| 6/28/2018 | 6/26/2018 | (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,300 |
|
|
|
|
|
|
| 141,603 |
|
| ||||||||||||||||||||||||
| 6/01/2018 | 6/26/2018 | (1) |
| 212,180 |
|
|
| 424,360 |
|
|
| 848,720 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
| 6/01/2018 | 6/26/2018 | (2) |
| 100,000 |
|
|
| 200,000 |
|
|
| 400,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
Dale T. Brinkman | 6/01/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
| 1,100 |
| 2,200 |
| 4,400 |
|
|
|
|
|
|
|
|
|
| 94,402 |
|
| |||||||||||||||||||||||
| 6/28/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2,500 |
| 42.91 |
|
| 31,375 |
|
| |||||||||||||||||||||||
| 6/28/2018 | 6/26/2018 | (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,300 |
|
|
|
|
|
|
| 141,603 |
|
| ||||||||||||||||||||||||
| 6/01/2018 | 6/26/2018 | (1) | 360,500 |
|
|
| 721,000 |
|
|
| 1,442,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||
| 6/01/2018 | 6/26/2018 | (2) | 300,000 |
|
|
| 600,000 |
|
|
| 1,200,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||
Mark A. Russell | 6/01/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
| 3,250 |
| 6,500 |
| 13,000 |
|
|
|
|
|
|
|
|
|
| 278,915 |
|
| |||||||||||||||||||||||
| 6/28/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 11,500 |
| 42.91 |
|
| 144,325 |
|
| |||||||||||||||||||||||
| 6/28/2018 | 6/26/2018 | (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 10,000 |
|
|
|
|
|
|
| 429,100 |
|
| ||||||||||||||||||||||||
| 6/01/2018 | 6/26/2018 | (1) |
| 193,125 |
|
|
| 386,250 |
|
|
| 772,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
| 6/01/2018 | 6/26/2018 | (2) |
| 137,500 |
|
|
| 275,000 |
|
|
| 550,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
John G. Lamprinakos | 6/01/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
| 1,850 |
| 3,700 |
| 7,400 |
|
|
|
|
|
|
|
|
|
| 158,767 |
|
| |||||||||||||||||||||||
| 6/28/2018 | 6/26/2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 4,800 |
| 42.91 |
|
| 60,240 |
|
| |||||||||||||||||||||||
| 6/28/2018 | 6/26/2018 | (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 5,100 |
|
|
|
|
|
|
| 218,841 |
|
|
(1) | These rows show the potential payouts which could have been earned under annual cash incentive bonus awards granted under the Annual Incentive Plan for Executives, based on achievement of specified levels of performance for the twelve months ended May 31, |
|
|
(3) | These rows show the number of annual time-vested restricted common shares awarded effective June |
These annual time-vested restricted common shares are generally forfeited in the event of termination of an NEO’s employment before vesting, except that (i) the restricted common shares will fully vest if the NEO dies or becomes totally disabled, (ii) a pro-rated portion of the restricted common shares will vest onupon the NEO’s retirement, and (iii) the Compensation Committee, in its discretion, may elect to vest all or a portion of the restricted common shares upon the NEO’s retirement. For information on the effect of a change in control, see the discussion in the section captioned “EXECUTIVE COMPENSATION“Executive Compensation – Compensation Discussion and Analysis – Change in Control” beginning on page 49 ofin this Proxy Statement.
The grant date fair value for the annual time-vested restricted common shares, computed in accordance with ASC 718, was calculated by multiplying the number of annual time-vested restricted common shares granted by the $42.91$60.19 closing price of the common shares on the grant date. See “Note A – Summary of Significant Accounting Policies – Stock-Based Compensation” and “Note KL – Stock-Based Compensation” of the Notes to Consolidated Financial Statements in “Item 8. – Financial Statements and Supplementary Data” of the 20192022 Form 10-K for additional information regarding the awards.
(4) | This row shows the |
|
|
|
|
|
|
| These columns show the potential payouts under long-term performance share awards granted to the NEOs under the 1997 LTIP for the three-fiscal-year performance period from June 1, |
The grant date fair value for the long-term performance share awards, computed in accordance with ASC 718, was calculated based upon the “target” award and the $42.91 closing price of the common shares on the date of grant.
| These stock options were granted as of June |
The grant date fair value of the option awards was $12.55 per share ($12.41 per share in the case of Mr. Hayek’s option award on November 1, 2018), computed in accordance with ASC 718. Generally, the grant date fair value of the options is the aggregate amount the Company would include as a compensation expense in its consolidated financial statements over each award’s three-year vesting schedule. See “Note A — Summary of Significant Accounting Policies — Stock-Based Compensation” and “Note K — Stock-Based Compensation” of the Notes to Consolidated Financial Statements in “Item 8. — Financial Statements and Supplementary Data” of the 2019 Form 10-K for the method (Black-Scholes) used in calculating the fair value of the option awards and additional information regarding the awards.
| Worthington | 2022 Proxy Statement |
|
Outstanding Equity Awards atat Fiscal 20192022 Year-End
The following table summarizes the outstanding stock option awards, restricted common share awards and long-term performance share awards held by the NEOs as of May 31, 2019.2022. For additional information about these equity awards, see the discussion in the sections captioned “EXECUTIVE COMPENSATION“Executive Compensation — Compensation Discussion and Analysis — Compensation Components — Stock Options”, “— Long-Term Performance Awards – General”, “— Long-Term Performance Share Awards,”Awards”, “— Annual Restricted Common Share Awards to Executives”, “— Other Restricted Common Share Awards to NEOs”NEOs in Fiscal 2022” and “— Special Performance-Based/Time-Vested Restricted Common Share Awards” beginning on page 42, page 43, page 44, page 45, page 45 and page 46, respectively, of, in this Proxy Statement.
Option Awards (1) |
|
|
| Stock Awards |
| |||||||||||||||||||||||||||||||
Name | No. of Common Shares Underlying Unexercised Options (#) Exercisable |
| No. of Common Shares Underlying Unexercised Options (#) Unexercisable |
| Option Exercise Price |
| Option Expiration Date |
| No. of Shares or Units of Stock that Have Not Vested (#) (2) |
| Market Value of Shares or Units of Stock That Have Not Vested ($) (3) | Equity Incentive Plan Awards: No. of Unearned Shares, Units or Other Rights That Have Not Vested (#) (4) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (4) |
| Equity Incentive Plan Awards: Performance Period Ending Date | |||||||||||||||||||||
B. Andrew Rose |
| 9,000 |
|
|
| 0 |
|
|
|
| $31.71 |
|
|
| 06/28/2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 9,000 |
|
|
| 0 |
|
|
|
| $43.04 |
|
|
| 06/30/2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 17,000 |
|
|
| 0 |
|
|
|
| $30.92 |
|
|
| 06/26/2025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 13,500 |
|
|
| 0 |
|
|
|
| $42.30 |
|
|
| 06/30/2026 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 11,500 |
|
|
| 0 |
|
|
|
| $47.76 |
|
|
| 06/29/2027 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 11,500 |
|
|
| 0 |
|
|
|
| $42.91 |
|
|
| 06/28/2028 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 9,334 |
|
|
| 4,666 | (5) |
|
|
| $38.91 |
|
|
| 06/27/2029 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 9,000 |
|
|
| 18,000 | (6) |
|
|
| $36.93 |
|
|
| 06/25/2030 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 0 |
|
|
| 16,900 | (7) |
|
|
| $60.19 |
|
|
| 06/25/2031 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 12,000 | (8) |
|
| 559,680 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 24,000 | (9) |
|
| 1,119,360 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 31,200 | (10) |
|
| 1,455,168 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 175,000 | (11) |
|
| 8,162,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 19,200 |
|
|
| 895,488 |
|
|
| 05/31/2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 10,900 |
|
|
| 508,376 |
|
|
| 05/31/2024 |
|
Joseph B. Hayek |
| 1,500 |
|
|
| 0 |
|
|
|
| $43.04 |
|
|
| 06/30/2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2,000 |
|
|
| 0 |
|
|
|
| $30.92 |
|
|
| 06/26/2025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,500 |
|
|
| 0 |
|
|
|
| $42.30 |
|
|
| 06/30/2026 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,200 |
|
|
| 0 |
|
|
|
| $47.76 |
|
|
| 06/29/2027 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,200 |
|
|
| 0 |
|
|
|
| $42.91 |
|
|
| 06/28/2028 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 4,200 |
|
|
| 0 |
|
|
|
| $42.10 |
|
|
| 11/01/2028 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 4,534 |
|
|
| 2,266 | (5) |
|
|
| $38.91 |
|
|
| 06/27/2029 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,367 |
|
|
| 6,733 | (6) |
|
|
| $36.93 |
|
|
| 06/25/2030 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 0 |
|
|
| 5,300 | (7) |
|
|
| $60.19 |
|
|
| 06/25/2031 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 5,400 | (8) |
|
| 251,856 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 8,500 | (9) |
|
| 396,440 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 5,200 | (10) |
|
| 242,528 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 25,000 | (12) |
|
| 1,166,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 25,000 | (13) |
|
| 1,166,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 50,000 | (14) |
|
| 2,332,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6,267 |
|
|
| 292,293 |
|
|
| 05/31/2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,400 |
|
|
| 158,576 |
|
|
| 05/31/2024 |
|
Outstanding Equity Awards at Fiscal 2019 Year-End
Option Awards (1) |
|
|
| Stock Awards |
| |||||||||||||||||||||||||||||||||||||||||||||
Name | No. of Common Shares Underlying Unexercised Options (#) Exercisable |
| No. of Common Shares Underlying Unexercised Options (#) Unexercisable |
| Option Exercise Price |
| Option Expiration Date |
| No. of Shares or Units of Stock that Have Not Vested (#) (2) |
| Market Value of Shares or Units of Stock That Have Not Vested ($) (3) | Equity Incentive Plan Awards: No. of Unearned Shares, Units or Other Rights That Have Not Vested (#) (4) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (4) |
| Equity Incentive Plan Awards: Performance Period Ending Date | |||||||||||||||||||||||||||||||||||
John P. McConnell |
| 135,000 |
|
|
|
| 0 |
|
|
|
|
| $12.05 |
|
|
|
| 07/02/20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
| 80,000 |
|
|
|
| 0 |
|
|
|
|
| $23.10 |
|
|
|
| 06/30/21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
| 80,000 |
|
|
|
| 0 |
|
|
|
|
| $20.47 |
|
|
|
| 06/29/22 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
| 17,000 |
|
|
|
| 0 |
|
|
|
|
| $31.71 |
|
|
|
| 06/28/23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
| 17,000 |
|
|
|
| 0 |
|
|
|
|
| $43.04 |
|
|
|
| 06/30/24 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
|
| 35,000 |
|
|
|
| 0 |
|
|
|
|
| $30.92 |
|
|
|
| 06/26/25 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
| 17,667 |
|
|
|
|
| 8,833 |
| (5) |
|
|
| $42.30 |
|
|
|
| 06/30/26 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
| 7,334 |
|
|
|
|
| 14,666 |
| (6) |
|
|
| $47.76 |
|
|
|
| 06/29/27 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
| 0 |
|
|
|
| 22,000 |
| (7) |
|
|
| $42.91 |
|
|
|
| 06/28/28 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
| (8) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 22,500 |
|
|
|
|
| 768,150 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (9) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 20,000 |
|
|
|
|
| 682,800 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (10) |
|
|
|
|
|
|
|
|
|
|
|
|
| 20,000 |
|
|
|
|
| 682,800 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 12,000 |
|
|
|
|
| 409,680 |
|
|
|
| 05/31/20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 12,000 |
|
|
|
|
| 409,680 |
|
|
|
| 05/31/21 |
|
Joseph B. Hayek |
|
| 1,500 |
|
|
|
| 0 |
|
|
|
|
| $ | 43.04 |
|
|
|
| 06/30/24 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
| 2,000 |
|
|
|
| 0 |
|
|
|
|
| $ | 30.92 |
|
|
|
| 06/26/25 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
| 1,000 |
|
|
|
| 500 |
| (5) |
|
|
| $ | 42.30 |
|
|
|
| 06/30/26 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
| 400 |
|
|
|
| 800 |
| (6) |
|
|
| $ | 47.76 |
|
|
|
| 06/29/27 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
| 0 |
|
|
|
|
| 1,200 |
| (7) |
|
|
| $ | 42.91 |
|
|
|
| 06/28/28 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
| 0 |
|
|
|
|
| 4,200 |
| (11) |
|
|
| $ | 42.10 |
|
|
|
| 11/01/28 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
| (8) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,300 |
|
|
|
|
| 44,382 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (12) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,500 |
|
|
|
|
| 119,490 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (9) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,200 |
|
|
|
|
| 109,248 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (10) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,200 |
|
|
|
|
| 40,968 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (13) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,500 |
|
|
|
|
| 119,490 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,919 |
|
|
|
|
| 65,515 |
|
|
|
| 05/31/20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,100 |
|
|
|
|
| 105,834 |
|
|
|
| 05/31/21 |
|
|
|
Option Awards (1) |
|
|
| Stock Awards |
| |||||||||||||||||||||||||||||||||||||||||||||
Name | No. of Common Shares Underlying Unexercised Options (#) Exercisable |
| No. of Common Shares Underlying Unexercised Options (#) Unexercisable |
| Option Exercise Price |
| Option Expiration Date |
| No. of Shares or Units of Stock that Have Not Vested (#) (2) |
| Market Value of Shares or Units of Stock That Have Not Vested ($) (3) | Equity Incentive Plan Awards: No. of Unearned Shares, Units or Other Rights That Have Not Vested (#) (4) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (4) |
| Equity Incentive Plan Awards: Performance Period Ending Date | |||||||||||||||||||||||||||||||||||
| 30,000 |
|
|
|
| 0 |
|
|
|
|
| $23.10 |
|
|
|
| 06/30/21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
| 50,000 |
|
|
|
| 0 |
|
|
|
|
| $20.47 |
|
|
|
| 06/29/22 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
| 9,000 |
|
|
|
| 0 |
|
|
|
|
| $31.71 |
|
|
|
| 06/28/23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
| 9,000 |
|
|
|
| 0 |
|
|
|
|
| $43.04 |
|
|
|
| 06/30/24 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
|
| 17,000 |
|
|
|
|
| — |
|
|
|
|
| $30.92 |
|
|
|
| 06/26/25 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
| 9,000 |
|
|
|
|
| 4,500 |
| (5) |
|
|
| $42.30 |
|
|
|
| 06/30/26 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
| 3,834 |
|
|
|
|
| 7,666 |
| (6) |
|
|
| $47.76 |
|
|
|
| 06/29/27 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
| 0 |
|
|
|
| 11,500 |
| (7) |
|
|
| $42.91 |
|
|
|
| 06/28/28 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
| (8) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 12,000 |
|
|
|
|
| 409,680 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (9) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 10,000 |
|
|
|
|
| 341,400 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (10) |
|
|
|
|
|
|
|
|
|
|
|
|
| 10,000 |
|
|
|
| 341,400 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
| (14) |
|
|
|
|
|
|
|
|
|
|
|
|
| 175,000 |
|
|
|
| 5,974,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6,500 |
|
|
|
| 221,910 |
|
|
|
| 05/31/20 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6,500 |
|
|
|
| 221,910 |
|
|
|
| 05/31/21 |
| |
Geoffrey G. Gilmore |
| 6,000 |
|
|
|
| 0 |
|
|
|
|
| $31.71 |
|
|
|
| 06/28/23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
| 6,000 |
|
|
|
| 0 |
|
|
|
|
| $43.04 |
|
|
|
| 06/30/24 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
|
| 8,500 |
|
|
|
| 0 |
|
|
|
|
| $30.92 |
|
|
|
| 06/26/25 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
| 5,000 |
|
|
|
|
| 2,500 |
| (5) |
|
|
| $42.30 |
|
|
|
| 06/30/26 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
| 2,134 |
|
|
|
|
| 4,266 |
| (6) |
|
|
| $47.76 |
|
|
|
| 06/29/27 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
| 0 |
|
|
|
| 6,400 |
| (7) |
|
|
| $42.91 |
|
|
|
| 06/28/28 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
| (8) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 8,000 |
|
|
|
|
| 273,120 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (9) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6,500 |
|
|
|
|
| 221,910 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (15) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 25,000 |
|
|
|
|
| 853,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (10) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6,500 |
|
|
|
|
| 221,910 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (16) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 25,000 |
|
|
|
| 853,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
| (17) |
|
|
|
|
|
|
|
|
|
|
|
|
| 20,000 |
|
|
|
| 682,800 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
| (18) |
|
|
|
|
|
|
|
|
|
|
|
|
| 30,000 |
|
|
|
| 1,024,200 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
| (14) |
|
|
|
|
|
|
|
|
|
|
|
|
| 50,000 |
|
|
|
| 1,707,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 4,400 |
|
|
|
|
| 150,216 |
|
|
|
| 05/31/20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 4,400 |
|
|
|
|
| 150,216 |
|
|
|
| 05/31/21 |
|
Virgil L. Winland |
| 23,000 |
|
|
|
| 0 |
|
|
|
|
| $12.05 |
|
|
|
| 07/02/20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
| 16,000 |
|
|
|
| 0 |
|
|
|
|
| $23.10 |
|
|
|
| 06/30/21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
| 16,000 |
|
|
|
| 0 |
|
|
|
|
| $20.47 |
|
|
|
| 06/29/22 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
| 3,000 |
|
|
|
| 0 |
|
|
|
|
| $31.71 |
|
|
|
| 06/28/23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
| 3,000 |
|
|
|
| 0 |
|
|
|
|
| $43.04 |
|
|
|
| 06/30/24 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
|
| 5,000 |
|
|
|
| 0 |
|
|
|
|
| $30.92 |
|
|
|
| 06/26/25 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
| 2,667 |
|
|
|
|
| 1,333 |
| (5) |
|
|
| $42.30 |
|
|
|
| 06/30/26 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
| 1,000 |
|
|
|
|
| 2,000 |
| (6) |
|
|
| $47.76 |
|
|
|
| 06/27/17 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
| 0 |
|
|
|
| 3,000 |
| (7) |
|
|
| $42.91 |
|
|
|
| 06/28/28 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
| (8) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,800 |
|
|
|
|
| 129,732 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (9) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,300 |
|
|
|
|
| 112,662 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (10) |
|
|
|
|
|
|
|
|
|
|
|
|
| 3,300 |
|
|
|
| 112,662 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2,200 |
|
|
|
|
| 75,108 |
|
|
|
| 05/31/20 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2,200 |
|
|
|
|
| 75,108 |
|
|
|
| 05/31/21 |
|
Dale T. Brinkman |
|
| 13,000 |
|
|
|
| 0 |
|
|
|
|
| $23.10 |
|
|
|
| 06/30/21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
| 13,000 |
|
|
|
| 0 |
|
|
|
|
| $20.47 |
|
|
|
| 06/29/22 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
| 2,000 |
|
|
|
| 0 |
|
|
|
|
| $31.71 |
|
|
|
| 06/28/23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
| 2,000 |
|
|
|
| 0 |
|
|
|
|
| $43.04 |
|
|
|
| 06/30/24 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
| 3,500 |
|
|
|
| 0 |
|
|
|
|
| $30.92 |
|
|
|
| 06/26/25 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
| 2,000 |
|
|
|
|
| 1,000 |
| (5) |
|
|
| $42.30 |
|
|
|
| 06/30/26 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
| 834 |
|
|
|
|
| 1,666 |
| (6) |
|
|
| $47.76 |
|
|
|
| 06/27/17 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
| 0 |
|
|
|
|
| 2,500 |
| (7) |
|
|
| $42.91 |
|
|
|
| 06/28/28 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
| (8) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,800 |
|
|
|
|
| 129,732 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (9) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,300 |
|
|
|
|
| 112,662 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (10) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,300 |
|
|
|
|
| 112,662 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2,200 |
|
|
|
|
| 75,108 |
|
|
|
| 05/31/20 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2,200 |
|
|
|
|
| 75,108 |
|
|
|
| 05/31/21 |
|
Executive Compensation • |
|
Option Awards (1) | Option Awards (1) |
|
|
| Stock Awards |
| Option Awards (1) |
|
|
| Stock Awards |
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Name | No. of Common Shares Underlying Unexercised Options (#) Exercisable |
| No. of Common Shares Underlying Unexercised Options (#) Unexercisable |
| Option Exercise Price |
| Option Expiration Date |
| No. of Shares or Units of Stock that Have Not Vested (#) (2) |
| Market Value of Shares or Units of Stock That Have Not Vested ($) (3) | Equity Incentive Plan Awards: No. of Unearned Shares, Units or Other Rights That Have Not Vested (#) (4) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (4) |
| Equity Incentive Plan Awards: Performance Period Ending Date | No. of Common Shares Underlying Unexercised Options (#) Exercisable |
| No. of Common Shares Underlying Unexercised Options (#) Unexercisable |
| Option Exercise Price |
| Option Expiration Date |
| No. of Shares or Units of Stock that Have Not Vested (#) (2) |
| Market Value of Shares or Units of Stock That Have Not Vested ($) (3) | Equity Incentive Plan Awards: No. of Unearned Shares, Units or Other Rights That Have Not Vested (#) (4) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (4) |
| Equity Incentive Plan Awards: Performance Period Ending Date | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 9,000 |
|
|
|
| 0 |
|
|
|
|
| $43.04 |
|
|
|
| 8/22/21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||
|
|
| 9,000 |
|
|
|
| 0 |
|
|
|
|
| $42.30 |
|
|
|
| 8/22/21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||
|
|
| 3,834 |
|
|
|
| 0 |
|
|
|
|
| $47.76 |
|
|
|
| 8/22/21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2,528 |
|
|
|
|
| 86,306 |
|
|
|
| 05/31/20 |
| ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 0 |
|
|
|
| 0 |
|
|
|
| 05/31/21 |
| ||||||||||||||||||||||||||||||||||||||
John G. Lamprinakos |
|
| 3,831 |
|
|
|
| 0 |
|
|
|
|
| $12.05 |
|
|
|
| 07/02/20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||
Geoffrey G. Gilmore |
| 0 |
|
|
| 3,333 | (5) |
|
|
| $38.91 |
|
|
| 06/27/2029 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
| 25,000 |
|
|
|
| 0 |
|
|
|
|
| $23.10 |
|
|
|
| 06/30/21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 4,600 |
|
|
| 9,200 | (6) |
|
|
| $36.93 |
|
|
| 06/25/2030 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
| 25,000 |
|
|
|
| 0 |
|
|
|
|
| $20.47 |
|
|
|
| 10/05/21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 0 |
|
|
| 6,200 | (7) |
|
|
| $60.19 |
|
|
| 06/25/2031 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
| 4,000 |
|
|
|
| 0 |
|
|
|
|
| $31.71 |
|
|
|
| 10/05/21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 8,500 | (8) |
|
| 396,440 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
| 4,000 |
|
|
|
| 0 |
|
|
|
|
| $43.04 |
|
|
|
| 10/05/21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 11,600 | (9) |
| �� | 541,024 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
| 6,000 |
|
|
|
| 0 |
|
|
|
|
| $30.92 |
|
|
|
| 10/05/21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6,000 | (10) |
|
| 279,840 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
| 3,800 |
|
|
|
| 0 |
|
|
|
|
| $42.30 |
|
|
|
| 10/05/21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 50,000 | (11) |
|
| 1,399,200 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
| 1,600 |
|
|
|
| 0 |
|
|
|
|
| $47.76 |
|
|
|
| 10/05/21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 30,000 | (15) |
|
| 2,332,000 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 0 |
|
|
|
|
| 0 |
|
|
|
| 05/31/20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 25,000 | (16) |
|
| 1,166,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 0 |
|
|
|
|
| 0 |
|
|
|
| 05/31/21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 7,600 |
|
|
| 354,464 |
|
|
| 05/31/2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 4,000 |
|
|
| 186,560 |
|
|
| 05/31/2024 |
| ||||||||||||||||||||||||||||||||||||||||||||||||||
John P. McConnell |
| 17,000 |
|
|
| 0 |
|
|
|
| $31.71 |
|
|
| 06/28/2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
| 17,000 |
|
|
| 0 |
|
|
|
| $43.04 |
|
|
| 06/30/2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
| 35,000 |
|
|
| 0 |
|
|
|
| $30.92 |
|
|
| 06/26/2025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
| 26,500 |
|
|
| 0 |
|
|
|
| $42.30 |
|
|
| 06/30/2026 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
| 22,000 |
|
|
| 0 |
|
|
|
| $47.76 |
|
|
| 06/29/2027 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
| 22,000 |
|
|
| 0 |
|
|
|
| $42.91 |
|
|
| 06/28/2028 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
| 18,000 |
|
|
| 9,000 | (5) |
|
|
| $38.91 |
|
|
| 06/27/2029 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
| 3,733 |
|
|
| 7,467 | (6) |
|
|
| $36.93 |
|
|
| 06/25/2030 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 22,500 | (8) |
|
| 1,049,400 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 9,400 | (9) |
|
| 438,416 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6,300 |
|
|
| 293,832 |
|
|
| 05/31/2023 |
| ||||||||||||||||||||||||||||||||||||||||||||||||||
Catherine M. Lyttle |
| 2,000 |
|
|
| 0 |
|
|
|
| $43.04 |
|
|
| 06/30/2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
| 2,200 |
|
|
| 0 |
|
|
|
| $30.92 |
|
|
| 06/26/2025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
| 1,800 |
|
|
| 0 |
|
|
|
| $42.30 |
|
|
| 06/30/2026 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
| 1,800 |
|
|
| 0 |
|
|
|
| $47.76 |
|
|
| 06/29/2027 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
| 1,700 |
|
|
| 0 |
|
|
|
| $42.91 |
|
|
| 06/28/2028 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
| 2,867 |
|
|
| 1,433 | (5) |
|
|
| $38.91 |
|
|
| 06/27/2029 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
| 1,967 |
|
|
| 3,933 | (6) |
|
|
| $36.93 |
|
|
| 06/25/2030 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
| 0 |
|
|
| 2,700 | (7) |
|
|
| $60.19 |
|
|
| 06/25/2031 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,700 | (8) |
|
| 172,568 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 5,000 | (9) |
|
| 233,200 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2,600 | (10) |
|
| 121,264 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 10,000 | (10) |
|
| 466,400 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,400 |
|
|
| 158,576 |
|
|
| 05/31/2023 |
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,700 |
|
|
| 79,288 |
|
|
| 05/31/2024 |
|
(1) | All stock options outstanding as of May 31, |
(2) |
|
(3) | Each market value shown in this column is calculated by multiplying the number of restricted common shares by the |
58 | Worthington | 2022 Proxy Statement • Executive Compensation |
(4) | The amounts shown in this column assume that the long-term performance share awards granted for each of the three-fiscal-year periods ending |
(5) | Unexercisable stock options vested on June |
(6) | Unexercisable stock options vested 50% on June |
(7) | Unexercisable stock options vested 33% on June |
(8) |
|
(9) |
|
|
|
(11) |
|
|
|
|
|
| Effective September 26, 2018, the NEO received a special performance-based/time-vested restricted common share award which will vest if both: (a) the closing price of the |
| This time-vested restricted common share award was granted effective |
| This time-vested restricted common share award was granted effective September 25, 2019 under the 1997 LTIP, and will become fully vested on September 25, 2024, subject to continued employment of the NEO and the terms of the time-vested restricted common share award. |
(14) | Effective |
|
|
| This time-vested restricted common share award was granted effective September 26, 2018 under the 1997 LTIP, and will become fully vested on September 26, 2023, subject to |
(16) | Effective June 25, 2020, the NEO received a special performance-based/time-vested restricted common share award which will vest if both: (a) the closing price of the common shares averages $65.00 per share for 90 consecutive days during the five-year period ending on June 25, 2025; and (b) the NEO has continuously remained our employee through June 25, 2023, or, if later, the date the common share price condition is met. Further information on this award is set forth in the section captioned “Executive Compensation – Compensation Discussion and Analysis — Compensation Components — Special Performance-Based/Time-Vested Restricted Common Share Awards” in this Proxy Statement. |
Executive Compensation • |
|
Option Exercises and Stock Vested
The following table sets forth information about (i) non-qualified stock options exercised by NEOs in Fiscal 2019;2022; (ii) long-term performance share awards earned by NEOs for the three-fiscal-year period ended May 31, 2019;with Fiscal 2022; and (iii) time-vested restricted common shares held by NEOs which vested in Fiscal 2019:2022:
Option Exercises and Stock Vested During Fiscal 20192022
|
|
| Option Awards |
|
|
|
| Stock Awards |
|
| Option Awards Exercised |
|
|
| Stock Awards Vested | |||||||||||||||||||||||||||||||||
Name |
| Number of Common Shares Acquired on Exercise (#) |
| Value Realized on Exercise ($) |
| Number of Common Shares Acquired on Vesting (#) |
| Value Realized on Vesting ($) |
| Number of Common Shares Acquired on Exercise (#) |
| Value Realized on Exercise ($) |
| Number of Common Shares Acquired on Vesting (#) |
| Value Realized on Vesting ($) | ||||||||||||||||||||||||||||||||
John P. McConnell |
|
|
| 100,000 |
|
|
|
| $ | 2,176,000 |
|
|
|
|
| 7,260 |
| (1) |
|
|
|
| 292,505 |
| (1) |
| ||||||||||||||||||||||
B. Andrew Rose |
|
|
| 0 |
|
|
|
| $0 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| 25,666 |
| (1) |
|
|
| $1,129,817 | (1) |
| ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 30,000 |
| (2) |
|
|
|
| 1,419,300 |
| (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 10,000 |
| (2) |
|
|
| $596,400 | (2) |
|
Joseph B. Hayek |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 501 |
| (1) |
|
|
|
| 20,185 |
| (1) |
|
|
|
| 0 |
|
|
|
| $0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,700 |
| (2) |
|
|
|
| 80,427 |
| (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 9,000 |
| (1) |
|
|
| $396,180 | (1) |
|
B. Andrew Rose |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,630 |
| (1) |
|
|
|
| 146,253 |
| (1) |
| ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 16,000 |
| (2) |
|
|
|
| 756,960 |
| (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,200 |
| (2) |
|
|
| $71,568 | (2) |
|
Geoffrey G. Gilmore |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,513 |
| (1) |
|
|
|
| 60,958 |
| (1) |
|
|
|
| 5,466 |
|
|
|
| $112,151 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 8,500 |
| (2) |
|
|
|
| 402,135 |
| (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 12,466 |
| (1) |
|
|
| $548,753 | (1) |
|
Virgil L. Winland |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,271 |
| (1) |
|
|
|
| 51,209 |
| (1) |
| ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 5,000 |
| (2) |
|
|
|
| 236,550 |
| (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6,500 |
| (2) |
|
|
| $387,660 | (2) |
|
Dale T. Brinkman |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,271 |
| (1) |
|
|
|
| 51,209 |
| (1) |
| ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 5,000 |
| (2) |
|
|
|
| 236,550 |
| (2) |
| ||||||||||||||||||||||
Mark A. Russell |
|
|
| 212,000 |
|
|
|
| $ | 5,455,457 |
|
|
|
|
| 2,622 |
| (1) |
|
|
|
| 105,640 |
| (1) |
| ||||||||||||||||||||||
John P. McConnell |
|
|
| 0 |
|
|
|
| 0 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 16,000 |
| (2) |
|
|
|
| 756,960 |
| (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 30,000 |
| (1) |
|
|
| $1,320,600 | (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 12,222 |
| (3) |
|
|
|
| 563,800 |
| (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 20,000 |
| (2) |
|
|
| $1,192,800 | (2) |
|
John G. Lamprinakos |
|
|
| 61,159 |
|
|
|
| $ | 1,738,992 |
|
|
|
|
| 791 |
| (1) |
|
|
|
| 31,869 |
| (1) |
| ||||||||||||||||||||||
Catherine M. Lyttle |
|
|
| 2,000 |
|
|
|
| $35,780 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6,500 |
| (2) |
|
|
|
| 307,515 |
| (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 5,400 |
| (1) |
|
|
| $237,708 | (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 19,700 |
| (3) |
|
|
|
| 852,060 |
| (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,400 |
| (2) |
|
|
| $83,496 | (2) |
|
(1) | The number of common shares acquired on vesting relates to long-term performance share awards granted |
(2) | The number of common shares acquired on vesting relates to restricted common share awards granted on June |
|
|
| Worthington | |
Non-Qualified Deferred Compensation
The Company maintainsWe maintain two Employee Deferral Plans which provide for the deferral of compensation on a basis that is not tax-qualified – the 2000 NQ Plan and the 2005 NQ Plan. Contributions and deferrals for the period from March 1, 2000 through December 31, 2004 are maintained under the 2000 NQ Plan. Contributions and deferrals for periods on or after January 1, 2005 are maintained under the 2005 NQ Plan, which was adopted to replace the 2000 NQ Plan in order to comply with the provisions of Section 409A of the Internal Revenue Code. The terms of the 2005 NQ Plan, which are discussed below, are similar to those of the 2000 NQ Plan but are more restrictive with respect to the timing of deferral elections and the ability of participants to change the time and manner in which accounts will be paid. The Employee Deferral Plans are intended to supplement the 401(k) plans sponsored by the Company.DPSP. For further information on the terms of the Employee Deferral Plans, see the discussion in the section captioned “EXECUTIVE COMPENSATION“Executive Compensation — Compensation Discussion and Analysis — Compensation Components — Non-Qualified Deferred Compensation” beginning on page 48 ofin this Proxy Statement.
Only select highly-compensated employees, of the Company, including the NEOs, are eligible to participate in the Employee Deferral Plans. As of August 1, 2019,2022, approximately 119143 of our employees of the Company were eligible to participate in the 2005 NQ Plan and 11five of our employees of the Company had accounts in the 2000 NQ Plan.
Under the 2005 NQ Plan, participants may defer the payment of up to 50% of their base salary and up to 100% of their bonus and/or annual cash incentive bonus awards. Deferred amounts are credited to the participants’ bookkeeping accounts under the 2005 NQ Plan at the time the base salaries and/or bonus/annual cash incentive bonus awards would have otherwise been paid. In addition, the Companywe may make discretionary employer contributions to participants’ bookkeeping accounts in the 2005 NQ Plan. For the 2019, 20182022, 2021 and 20172020 calendar years, in order to provide the same percentage of retirement-related deferred compensation contributions to participants compared to other employees that would have been made but for the IRS limits on annual compensation that may be considered under tax-qualified plans, the Companywe made contributions to participants’ bookkeeping accounts under the 2005 NQ Plan equal to (i) 3% of a participant’s annual compensation (base salary plus bonus/annual cash incentive bonus award) in excess of the IRS maximum; and (ii) a matching contribution of 50% of the first 4% of annual compensation contributed by the participant to the DPSP to the extent not matched by the Companyus under the DPSP.
Participants in the 2005 NQ Plan may elect to have their bookkeeping accounts treated as invested (a) with a rate of return reflectingreflecting: (i) a fixed interest rate which is set annually by the Compensation Committee (2.48%(0.85% for Fiscal 2019)2022); or (ii) the returns on those investment options available under the DPSP, or (b) in theoretical common shares reflecting increases or decreases in the value of Worthington’s`the common shares with dividends deemed reinvested. Any portion of a participant’s bookkeeping account credited to theoretical common shares must remain credited to theoretical common shares until distributed. Otherwise, participants in the 2005 NQ Plan may change the investment options for their bookkeeping accounts as of the time permitted under the DPSP for the same or a similar investment option.
Bookkeeping accounts of employeesparticipants are fully vested under the 2005 NQ Plan. Theoretical common shares are paid in whole common shares and cash in lieu of fractional shares and all other amounts are paid in cash. Payouts are made as of a specified date selected by the participant or, subject to the timing requirements of Section 409A of the Internal Revenue Code, when the participant is no longer employed by the Company.us. Payouts are made in a lump sum or in installment payments,installments, as chosen by the participant at the time the deferral election is made. The Compensation Committee may permit hardship withdrawals from a participant’s bookkeeping account under the 2005 NQ Plan in accordance with defined guidelines. In the event of a defined change in control, the participants’ bookkeeping accounts under the 2005 NQ Plan will generally be paid out as of the date of the change in control.
Executive Compensation • |
|
The following table provides information concerning the participation by the NEOs in the Employee Deferral Plans for Fiscal 2019:2022:
Non-Qualified Deferred Compensation for Fiscal 20192022
Name | Name of Plan | Executive Contributions in Fiscal 2019 ($) (1) | Company Contributions in Fiscal 2019 ($) (2) | Aggregate Earnings (Loss) in Fiscal 2019 ($) (3) | Aggregate Withdrawals/ Distributions ($) (4) |
|
| Aggregate Balance at May 31, 2019 ($) (5) |
| Name of Plan | Executive Contributions in Fiscal 2022 ($) (1) | Company Contributions in Fiscal 2022 ($) (2) | Aggregate Earnings (Loss) in Fiscal 2022($) (3) | Aggregate Withdrawals/ Distributions ($) |
| Aggregate Balance at May 31, 2022 ($) (4) | ||||||||||||||||
John P. McConnell | 2000 NQ Plan |
| 0 |
|
| 0 |
|
|
| 8,693 |
|
| 0 |
|
|
| 356,394 |
| ||||||||||||||
B. Andrew Rose | 2000 NQ Plan |
| 0 |
| 0 |
| 0 |
| 0 |
| 0 | |||||||||||||||||||||
| 2005 NQ Plan |
| 0 |
|
|
| 44698 |
|
|
| 13,663 |
|
| 0 |
|
|
| 596,226 |
| 2005 NQ Plan |
| 86,808 |
| 101,619 |
| 21,295 |
| 0 |
| 2,645,804 | ||
Joseph B. Hayek | 2000 NQ Plan |
| 0 |
|
|
| 0 |
|
| 0 |
|
|
| 0 |
|
|
| 0 |
| 2000 NQ Plan |
| 0 |
| 0 |
| 0 |
| 0 |
| 0 | ||
| 2005 NQ Plan |
|
| 38,813 |
|
|
| 12876 |
|
|
| (10,995 | ) |
|
| 0 |
|
|
| 188,143 |
| 2005 NQ Plan |
| 21,894 |
| 45,862 |
| (62,106) |
| 0 |
| 440,183 |
B. Andrew Rose | 2000 NQ Plan |
| 0 |
|
| 0 |
|
| 0 |
|
| 0 |
|
|
| 0 |
| |||||||||||||||
| 2005 NQ Plan |
|
| 158,059 |
|
|
| 43582 |
|
|
| 29,077 |
|
| 0 |
|
|
| 1,806,542 |
| ||||||||||||
Geoffrey G. Gilmore | 2000 NQ Plan |
| 0 |
|
| 0 |
|
| 0 |
|
| 0 |
|
|
| 0 |
| 2000 NQ Plan |
| 0 |
| 0 |
| 0 |
| 0 |
| 0 | ||||
| 2005 NQ Plan |
| 0 |
|
|
| 26650 |
|
|
| (86,491 | ) |
| 0 |
|
|
| 251,142 |
| 2005 NQ Plan |
| 0 |
| 55,353 |
| (181,828) |
| 0 |
| 495,273 | ||
Virgil L. Winland | 2000 NQ Plan |
|
| 0 |
|
|
| 0 |
|
|
| 3,141 |
|
| 0 |
|
|
| 128,761 |
| ||||||||||||
John P. McConnell | 2000 NQ Plan |
| 0 |
| 0 |
| 3,120 |
| 0 |
| 372,545 | |||||||||||||||||||||
| 2005 NQ Plan |
| 0 |
|
|
| 21677 |
|
|
| 6,214 |
|
| 0 |
|
|
| 272,263 |
| 2005 NQ Plan |
| 0 |
| 32,831 |
| 5,993 |
| 0 |
| 739,391 | ||
Dale T. Brinkman | 2000 NQ Plan |
| 0 |
|
|
| 0 |
|
|
| 6,020 |
|
|
| 0 |
|
|
| 246,798 |
| ||||||||||||
Catherine M. Lyttle | 2000 NQ Plan |
| 0 |
| 0 |
| 0 |
| 0 |
| 0 | |||||||||||||||||||||
| 2005 NQ Plan |
| 0 |
|
| 20578 |
|
|
| 18,931 |
|
|
| 0 |
|
|
| 792,743 |
| 2005 NQ Plan |
| 0 |
| 28,711 |
| (40,976) |
| 0 |
| 356,669 | ||
Mark A. Russell | 2000 NQ Plan |
| 0 |
|
| 0 |
|
|
| 0 |
|
| 0 |
|
|
| 0 |
| ||||||||||||||
| 2005 NQ Plan |
|
| 15,055 |
|
|
| 0 |
|
|
| (1,934,517 | ) |
|
| (9,557,372 | ) |
|
| 0 |
| |||||||||||
John G. Lamprinakos | 2000 NQ Plan |
| 0 |
|
|
| 0 |
|
|
| 259 |
|
|
| (28,326 | ) |
|
| 0 |
| ||||||||||||
| 2005 NQ Plan |
|
| 77,325 |
|
|
| 0 |
|
|
| 13,041 |
|
|
| (370,727 | ) |
|
| 113,416 |
|
(1) | The amounts in this column reflect contributions to the 2005 NQ Plan during Fiscal |
(2) | These contributions are included in the “All Other Compensation” column in the “Fiscal |
(3) | The amounts included in this column represent the aggregate earnings (loss) accrued during Fiscal |
(4) |
|
| The amounts included in |
| Worthington | |
Annual Cash Incentive Bonus AwardsAwards Granted to NEOs for Fiscal 20202023
The following supplemental table sets forth the annual cash incentive bonus awards granted to the NEOs under the Annual Incentive Plan for Executives for Fiscal 20202023 as of the date of this Proxy Statement:
Annual Cash Incentive Bonus Awards Granted for Fiscal 20202023
|
| Annual Cash Incentive Bonus Awards for Twelve-Month Performance Period Ending May 31, 2020 (1) |
|
| Annual Cash Incentive Bonus Awards for Twelve-Month Performance Period Ending May 31, 2023 (1) | |||||||||||||||||
Name |
| Threshold ($) |
| Target ($) |
| Maximum ($) |
|
| Threshold ($) |
| Target ($) |
| Maximum ($) | |||||||||
B. Andrew Rose |
| 525,000 |
|
| 1,050,000 |
|
| 2,100,000 | ||||||||||||||
Joseph B. Hayek |
| 307,500 |
|
| 615,000 |
|
| 1,230,000 | ||||||||||||||
Geoffrey G. Gilmore |
| 405,900 |
|
| 811,800 |
|
| 1,623,600 | ||||||||||||||
John P. McConnell |
|
| 483,969 |
|
|
|
| 967,938 |
|
|
|
| 1,935,876 |
|
| 214,240 |
|
| 428,480 |
|
| 856,960 |
Joseph B. Hayek |
|
| 198,275 |
|
|
|
| 396,550 |
|
|
|
| 793,100 |
| ||||||||
B. Andrew Rose |
|
| 386,250 |
|
|
|
| 772,500 |
|
|
|
| 1,545,000 |
| ||||||||
Geoffrey G. Gilmore |
|
| 339,900 |
|
|
|
| 679,800 |
|
|
|
| 1,359,600 |
| ||||||||
Virgil L. Winland |
|
| 245,864 |
|
|
|
| 491,727 |
|
|
|
| 983,454 |
| ||||||||
Dale T. Brinkman |
|
| 218,546 |
|
|
|
| 437,091 |
|
|
|
| 874,182 |
| ||||||||
Mark A. Russell |
| N/A |
|
|
| N/A |
|
|
| N/A |
| |||||||||||
John G. Lamprinakos |
| N/A |
|
|
| N/A |
|
|
| N/A |
| |||||||||||
Catherine M. Lyttle |
| 189,000 |
|
| 378,000 |
|
| 756,000 |
(1) | Payouts which can be earned under these annual cash incentive bonus awards are generally tied to achieving specified levels (threshold, target and maximum) of |
Executive Compensation • |
|
Long-Term Performance Awards, Option Awards and RestrictedRestricted Common Share Awards Granted to NEOs in Fiscal 20202023
The following supplemental table sets forth the long-term performance awards (consisting of long-term cash performance awards and long-term performance share awards) for the three-fiscal-year period ending May 31, 2022,with Fiscal 2025, and the stock option awards and the restricted common share awards granted to the NEOs as well as the “Executive Group”, the “Non-Executive Director Group” and the “Non-Executive Officer Employee Group” (as each term is defined on page 82 of this Proxy Statement) in Fiscal 20202023 through the date of this Proxy Statement.
Long-Term Performance Awards, Option Awards and Restricted Common Share Awards Granted in Fiscal 20202023
|
| Long-Term Cash Performance Awards for Three-Fiscal-Year Period Ending May 31, 2022 (1) |
| Long-Term Performance Share Awards for Three-Fiscal-Year Period Ending May 31, 2022 (1) |
| Option Awards: Number of | Exercise or Base Price of |
| ||||||||||
Name |
| Threshold ($) | Target ($) | Maximum ($) | Threshold (# of Common Shares) | Target (# of Common Shares) | Maximum (# of Common Shares) | Common Shares Underlying Options (2) | Option Awards ($/Share) (2) | Restricted Common Share Awards | ||||||||
John P. McConnell |
| 500,000 |
| 1,000,000 |
| 2,000,000 |
| 7,500 |
| 15,000 |
| 30,000 |
| 27,000 |
| 38.91 |
| 22,500 (3) |
Joseph B. Hayek |
| 140,000 |
| 280,000 |
| 560,000 |
| 1,800 |
| 3,600 |
| 7,200 |
| 6,800 |
| 38.91 |
| 5,400 (3) |
B. Andrew Rose |
| 300,000 |
| 600,000 |
| 1,200,000 |
| 3,750 |
| 7,500 |
| 15,000 |
| 14,000 |
| 38.91 |
| 12,000 (3) |
Geoffrey G. Gilmore |
| 220,000 |
| 440,000 |
| 880,000 |
| 2,850 |
| 5,700 |
| 11,400 |
| 10,000 |
| 38.91 |
| 8,500 (3) |
Virgil L. Winland |
| 115,000 |
| 230,000 |
| 460,000 |
| 1,250 |
| 2,500 |
| 5,000 |
| 4,300 |
| 38.91 |
| 3,700 (3) |
Dale T. Brinkman |
| 100,000 |
| 200,000 |
| 400,000 |
| 1,250 |
| 2,500 |
| 5,000 |
| 4,300 |
| 38.91 |
| 3,700 (3) |
Mark A. Russell |
| N/A |
| N/A |
| N/A |
| N/A |
| N/A |
| N/A |
| N/A |
| N/A |
| N/A |
John G. Lamprinakos |
| N/A |
| N/A |
| N/A |
| N/A |
| N/A |
| N/A |
| N/A |
| N/A |
| N/A |
Executive Group (3) |
| 129,000 |
| 258,000 |
| 516,000 |
| 1,650 |
| 3,300 |
| 6,600 |
| 5,900 |
| 38.91 |
| 5,000 (3) |
Non-Executive Director Group |
| 0 |
| 0 |
| 0 |
| 0 |
| 0 |
| 0 |
| 0 |
| 0 |
| 0 |
Non-Executive Officer Employee Group (3) |
| 1,045,000 |
| 2,090,000 |
| 4,180,000 |
| 7,700 |
| 15,400 |
| 30,800 |
| 28,400 |
| 38.91 |
| 43,000 (3) |
|
| Long-Term Cash Performance Awards for Three-Fiscal-Year Period Ending May 31, 2025 (1) |
| Long-Term Performance Share Awards for Three-Fiscal-Year Period Ending May 31, 2025 (1) |
| Option Awards: Number of | Exercise or Base Price of |
| ||||||||||
Name |
| Threshold ($) | Target ($) | Maximum ($) | Threshold (# of Common Shares) | Target (# of Common Shares) | Maximum (# of Common Shares) | Common Shares Underlying Options (2) | Option Awards ($/Share) (2) | Restricted Common Share Awards (3) | ||||||||
B. Andrew Rose |
| 800,000 |
| 1,600,000 |
| 3,200,000 |
| 9,100 |
| 18,200 |
| 36,400 |
| 25,400 |
| 46.39 |
| 27,200 |
Joseph B. Hayek |
| 240,000 |
| 480,000 |
| 960,000 |
| 2,700 |
| 5,400 |
| 10,800 |
| 7,700 |
| 46.39 |
| 8,200 |
Geoffrey G. Gilmore |
| 280,000 |
| 560,000 |
| 1,120,000 |
| 3,200 |
| 6,400 |
| 12,800 |
| 8,900 |
| 46.39 |
| 9,500 |
John P. McConnell (4) |
| 500,000 |
| 1,000,000 |
| 2,000,000 |
| 0 |
| 0 |
| 0 |
| 0 |
| N/A |
| 0 |
Catherine M. Lyttle |
| 120,000 |
| 240,000 |
| 480,000 |
| 1,350 |
| 2,700 |
| 5,400 |
| 3,900 |
| 46.39 |
| 4,100 |
(1) | These columns show the potential payouts under the long-term cash performance awards and the long-term performance share awards granted to |
(2) | Effective June |
(3) | These annual time-vested restricted common share awards were granted effective June |
These annual time-vested restricted common shares are generally forfeited in the event of termination of the holder’s employment before vesting, except that (i) the restricted common shares will fully vest if the holder dies or becomes totally disabled, (ii) a pro-rated portion of the restricted common shares will vest on retirement, and (iii) the Compensation Committee, in its discretion, may elect to vest all or a portion of the restricted common shares upon retirement. For information on the effect of a change in control, see the discussion in the section captioned “EXECUTIVE COMPENSATION“Executive Compensation -- Compensation Discussion and Analysis – Change in Control” beginning on page 49 ofin this Proxy Statement.
(4) | Due to restrictions under the Hart-Scott-Rodino Act on issuances of common shares to Mr. McConnell, he received only long-term cash performance awards. |
| Worthington | |
As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(u) of SEC Regulation S-K, we are providing the following information about the relationship of the median of the annual total compensation of our employees and the annual total compensation of John P. McConnell, our CEO:the CEO as of May 31, 2022:
For Fiscal 2019,2022, our last completed fiscal year:
(1) | The annual total compensation of the employee identified |
(2) | The annual total compensation of the CEO for purposes of determining the CEO |
Based on this information, for Fiscal 2019,2022, the ratio of the annual total compensation of Mr. McConnell, ourthe CEO to the median of the annual total compensation of all employees (other than the CEO), as represented by the Median Employee, was estimated at 58to be 80 to 1.
In order to identifydetermining the ratio above, we began by using the same employee identified at the median of our Company for purposes of calculating the CEO pay ratio included in our 2021 proxy statement. We do not believe that there have been any changes in our employee population or employee compensation arrangements that would significantly impact the pay ratio disclosure. The Median Employee was initially identified on May 31, 2021 (the “Determination Date”) as the median of the annual total compensation of all of our active employees (i.e., the employees of our subsidiaries and consolidated joint ventures) as of the Company and its consolidated joint ventures and subsidiaries as of May 31, 2018Determination Date (including any full-time, part-time, temporary or seasonal employees, but excluding our CEO), we usedusing the following methodology. We reviewed the then current base salary plus estimated profit sharing and/or bonus payments from our payroll records for Fiscal 2019.the fiscal year ended on the Determination Date in order to determine the median. In making this determination, we annualized compensation for any full-time or part-time permanent employees who were employed on May 31, 2018the Determination Date but did not work for us the entire year (Fiscal 2021), and also estimated total compensation for such employees using profit sharing factors and bonus payout percentages applicable to the business unit and/or location. We did not make any full-time equivalent adjustments for part-time or seasonal employees. We also applied a foreign currency exchange rate, based upon the U.S. Department of Treasury’s Treasury Reporting Rates of Exchange as of May 31, 2018,the Determination Date, to all compensation elements paid in currencies other than U.S. dollars. We consistently applied this compensation measure and methodology to all of our employees included in the calculation.
After identifying our median employee,Median Employee, we determined the median employee’sMedian Employee’s annual total compensation in the same manner that we determine the total compensation of our named executive officersNEOs for purposes of the Fiscal 2019“Fiscal 2022 Summary Compensation TableTable” set forth on page 52 ofin this Proxy Statement. With respect to the annual total compensation of our CEO, we used the amount for Fiscal 20192022 reported in the “Total” column of the Fiscal 2019“Fiscal 2022 Summary Compensation Table.Table”.
This information is being provided for compliance purposes. Neither the Compensation Committee nor our management of the Company used the CEO pay ratio measure in making compensation decisions.
Executive Compensation • |
|
of Directors
The Compensation Committee annually reviews, with the assistance of Willis Towers Watson, certain market information provided by Willis Towers Watson concerning compensation (both cash and non-cash) paid to directors. Based upon such information, the Company’sour past practices concerning directors’ compensation and such other information as the Compensation Committee deems appropriate, the Compensation Committee makes recommendations to the Board with respect to directors’ compensation. Following consideration of such recommendations, the compensation payable to the directors is set by the entire Board.
Compensation for Fiscal 20192022
At its June 20182021 meeting, based upon the recommendation of the Compensation Committee, the Board had determined to leave directors’ fees unchanged from Fiscal 2018. Accordingly, cash compensation was paid pursuant to the following table.
Annual Retainer |
|
| $ | 85,000 |
|
Lead Independent Director Supplemental Annual Retainer |
|
| $ | 25,000 |
|
Audit Committee Chair Supplemental Annual Retainer |
|
| $ | 15,000 |
|
Compensation Committee Chair Supplemental Annual Retainer |
|
| $ | 12,000 |
|
Nominating and Governance Committee Chair Supplemental Annual Retainer |
|
| $ | 10,000 |
|
Also, consistent with this decision, the Compensation Committee recommended leaving the directors’ targeted annual equity grant unchanged. Based on this recommendation, the Board approved making an annual restricted common share award to each non-employee director having a targeted value of approximately $120,000 ($180,000 for Mr. Blystone as Lead Independent Director), with the actual number of common shares granted determined based upon the price of Worthington’s common shares at or shortly before the date of the 2018 Annual Meeting of Shareholders. Accordingly, each non-employee director received a restricted common share award covering 2,700 common shares (4,050 common shares for Mr. Blystone), as of September 26, 2018, the date of the 2018 Annual Meeting of Shareholders.
Compensation for Fiscal 2020
At its June 2019 meeting, the Compensation Committee received a report from Willis Towers Watson, its compensation consultant, on directors’ compensation, including information on the amount of directors’ fees being paid by comparative companies, which showed that both the cash and the equity portion of the Company’s director compensation were below market median levels. Based on the recommendation from the compensation consultant, the Compensation Committee recommended and the Board approved, increasing both the cash directors’retainer fees and the targeted value of the directors’ annualannualized equity grant. grants unchanged for Fiscal 2022, except for the Nominating and Governance Committee Chair Supplemental Annual Retainer, which was raised to $15,000.
TheFor Fiscal 2022, the cash retainer fees forpaid to non-employee directors, to be paid, effective as of the 20192021 Annual Meeting, are set forth in the following table:
Annual Retainer |
|
| $ | 95,000 |
|
Lead Independent Director Supplemental Annual Retainer |
|
| $ | 30,000 |
|
Audit Committee Chair Supplemental Annual Retainer |
|
| $ | 20,000 |
|
Compensation Committee Chair Supplemental Annual Retainer |
|
| $ | 15,000 |
|
Nominating and Governance Committee Chair Supplemental Annual Retainer |
|
| $ | 10,000 |
|
Annual Retainer | $95,000 | ||
$30,000 | |||
Audit Committee Chair Supplemental Annual Retainer | $20,000 | ||
Compensation Committee Chair Supplemental Annual Retainer | $15,000 | ||
Nominating and Governance Committee Chair Supplemental Annual Retainer | $15,000 |
The targeted value of the annual equity grant was increasedset to be approximately $130,000 ($195,000 for Mr. Blystone as the Lead Independent Director), with the actual number of restricted common shares granted effective as of the date of the 2021 Annual Meeting determined based upon the price of the common shares at or shortly before the date of the 2021 Annual Meeting, with reasonable rounding. Accordingly, on September 29, 2021, each individual then serving as a non-employee director (including each non-employee director nominee elected at the 2021 Annual Meeting) immediately following the 2021 Annual Meeting received an award of 2,400 restricted common shares (3,600 for Mr. Blystone as Lead Independent Director). These restricted common shares will vest on September 28, 2022.
Compensation for Fiscal 2023
At its June 2022 meeting, upon recommendation of the Compensation Committee, the Board determined to leave the directors’ cash retainer fees and the targeted value of the directors’ annualized equity grants unchanged for Fiscal 2023.
For Fiscal 2023, the targeted value of the annual equity grant will remain at approximately $130,000 ($195,000 for Mr. Blystone as the Lead Independent Director), with the actual number of restricted common shares granted to be determined based upon the price of Worthington’sthe common shares at or shortly before the date of the 20192022 Annual Meeting, with reasonable rounding.
|
|
The Company maintainsWe maintain two Director Deferral Plans which provide for deferral of directors’ fees on a basis that is not tax-qualified. The Worthington Industries, Inc. Deferred Compensation Plan for Directors, as Amended and Restated effective June 1, 2000 (as amended, the “Directors 2000 NQ Plan”) governs deferrals prior to January 1, 2005. Deferrals with respect to the period on or after January 1, 2005 are governed by the Worthington Industries, Inc. Amended and Restated 2005 Deferred Compensation Plan for Directors (Restatement effective as of December 2008) (as amended, the “Directors 2005 NQ Plan”) which was adopted in order to comply with the provisions of Section 409A of the Internal Revenue Code applicable to non-qualified deferred compensation plans. The terms of the Directors 2005 NQ Plan, which are discussed below are similar to those of the Directors 2000 NQ Plan but are generally more restrictive with respect to the timing of deferral elections and the ability of participants to change the time and manner in which accounts will be paid.
Under the Directors 2005 NQ Plan, non-employee directors are able to defer payment of all or a portion of their cash annual retainers until a specified date or until they are no longer associated with the Company.us. Any cash retainers deferred are credited to each participating director’s bookkeeping account under the Directors 2005 NQ Plan at the time the cash retainers would have otherwise been paid. Participants in the Directors 2005 NQ Plan may elect to have their bookkeeping accounts treated as investedinvested: (a) with a rate of return reflecting (i) a fixed interest rate (2.48%(0.85% for Fiscal 2019)2022) which is set annually by the Compensation Committee; or (ii) the
66 | Worthington | 2022 Proxy Statement • Compensation of Directors |
rates of return on those investment options available under the DPSP; or (b) in theoretical common shares reflecting increases or decreases in the value of Worthington’sthe common shares with dividends deemed reinvested. Any portion of a participant’s bookkeeping account credited to theoretical common shares will remain credited to theoretical common shares until distributed. Otherwise, participants in the Directors 2005 NQ Plan may change the investment options for their bookkeeping accounts at the time permitted by the DPSP for the same investment option.options. The Directors 2005 NQ Plan, as well as the Directors 2000 NQ Plan, are administered by the Compensation Committee. All bookkeeping accounts are fully vested. Payouts under the Directors 2005 NQ Plan are made in cash or, in the case of amounts credited to theoretical common shares, whole common shares and cash in lieu of fractional shares. The Compensation Committee may permit hardship withdrawals from a participant’s bookkeeping account under the Directors 2005 NQ Plan under defined guidelines. In the event of a defined change in control, participants’ bookkeeping accounts under the Directors 2005 NQ Plan will generally be paid out as of the date of change in control.
Equity Grants
Under the Worthington Industries, Inc. Amended and Restated 2006 Equity Incentive Plan for Non-Employee Directors (as amended, the “2006 Directors Equity Plan”), the Board may grant non-qualified stock options, restricted common shares, restricted stock units, stock appreciation rights and whole common shares to our non-employee directors of the Company.directors. Awards under the 2006 Directors Equity Plan are made by the Board in its discretion.
OnAs noted above, on September 26, 2018,29, 2021, each individual then serving as a non-employee director (including each non-employee director nominee elected at the 20182021 Annual Meeting) immediately following the 20182021 Annual Meeting received an award of 2,7002,400 restricted common shares (4,050(3,600 for Mr. Blystone as Lead Independent Director). These restricted common shares will vest on September 25, 2019.28, 2022.
OnAlso as noted above, on September 25, 2019,28, 2022, each individual then serving as a non-employee director (including each non-employee director nominee elected at the 20192022 Annual Meeting) immediately following the 20192022 Annual Meeting will receive a restricted common share award having a value of approximately $130,000 ($195,000 for Mr. Blystone as Lead Independent Director), with the number of restricted common shares awarded based on the then market price of Worthington’sthe common shares on or shortly before that date. Each of these restricted common share awards will vest on the first to occur of the first anniversary of the date of grant or the date of the 20202023 annual meeting of shareholders (“2023 Annual Meeting of Shareholders.Meeting”).
Upon a business combination or change in control, all restricted common shares will become fully vested. In the case of death, total disability or retirement of a non-employee director, all restricted common shares will also immediately become fully vested. If a non-employee director’s service on the Board terminates for any other reason, unvested restricted common shares will be forfeited. During the time between the grant date and the vesting date, a non-employee director may exercise full voting rights in respect of the common shares underlying the restricted common shares and will be credited with any dividends paid on the common shares underlying the restricted common shares (which dividends will be distributed with the common shares underlying the restricted common shares if they vest, or forfeited if the restricted common shares are forfeited).
Compensation of Directors • |
|
Director Compensation for Fiscal 20192022
The following table sets forth information concerning the compensation earned by the Company’sour non-employee directors during Fiscal 2019:2022:
Director Compensation for Fiscal 20192022 (1)(2)(3)
Name | Fees Earned or Paid in Cash ($) (4) | Stock Awards ($) (5) |
| Option Awards ($) (6) |
| Total ($) |
| Fees Earned or Paid in Cash ($) (3) | Stock Awards ($) (4) | Total ($) | |||||||
Kerrii B. Anderson |
| 85,000 |
|
|
| 114,750 |
|
| — |
|
| 199,750 |
| 95,000 |
| 130,176 | 225,176 |
John B. Blystone (7) |
| 122,000 |
|
|
| 172,125 |
|
| — |
|
| 294,125 |
| ||||
David P. Blom | 95,000 |
| 130,176 | 225,176 | |||||||||||||
John B. Blystone (5) | 140,000 |
| 195,264 | 335,264 | |||||||||||||
Mark C. Davis |
| 85,000 |
|
|
| 114,750 |
|
| — |
|
| 199,750 |
| 95,000 |
| 130,176 | 225,176 |
Michael J. Endres |
| 85,000 |
|
|
| 114,750 |
|
| — |
|
| 199,750 |
| 95,000 |
| 130,176 | 225,176 |
Ozey K. Horton, Jr. |
| 85,000 |
|
|
| 114,750 |
|
| — |
|
| 199,750 |
| 95,000 |
| 130,176 | 225,176 |
Peter Karmanos, Jr. |
| 95,000 |
|
|
| 114,750 |
|
| — |
|
| 209,750 |
| 105,000 |
| 130,176 | 235,176 |
Carl A. Nelson, Jr. |
| 100,000 |
|
|
| 114,750 |
|
| — |
|
| 214,750 |
| 115,000 |
| 130,176 | 245,176 |
Sidney A. Ribeau |
| 85,000 |
|
|
| 114,750 |
|
| — |
|
| 199,750 |
| 95,000 |
| 130,176 | 225,176 |
Mary Schiavo |
| 85,000 |
|
|
| 114,750 |
|
| — |
|
| 199,750 |
| 95,000 |
| 130,176 | 225,176 |
(1) | Mr. |
|
|
| Since the earnings on compensation that has been deferred under the Director Deferral Plans by |
| Represents cash earned in Fiscal |
| The amounts shown in this column represent the grant date fair value of the restricted common share awards granted to the non-employee directors in Fiscal |
|
|
| Mr. Blystone is |
| Worthington | |
Equity Compensation Plan Information
The Company maintains fourWe maintain three equity compensation plans (the “Equity Plans”) under which common shares are authorized for issuance to eligible directors, officers and employees: (a) the 1997 LTIP; (b) the 2003 Stock Option Plan; (c) the 2006 Directors Equity Plan; and (d)(c) the 2010 Stock Option Plan. Each Equity Plan has been approved by the shareholders of the Company.our shareholders. In addition, the Company also maintainswe maintain four non-qualified deferred compensation plans and participants in these plans have had the opportunity to elect to have their bookkeeping accounts treated as invested in theoretical common shares reflecting increases or decreases in the fair market value of Worthington’sthe common shares with dividends deemed reinvested. Payouts of amounts credited to theoretical common shares are made in whole common shares and cash in lieu of fractional shares. For further information about the Employee Deferral Plans, please see the discussion in the section captioned “EXECUTIVE COMPENSATION“Executive Compensation –– Compensation Discussion and Analysis –– Compensation Components –– Non-Qualified Deferred Compensation” beginning on page 48 ofin this Proxy Statement and for further information concerning the Director Deferral Plans, please see the discussion in the section captioned “COMPENSATION OF DIRECTORS“Compensation of Directors –– Director Deferral Plans” beginning on page 69 ofin this Proxy Statement.
The following table shows for the Equity Plans, as a group, the number of common shares issuable upon the exercise of outstanding stock options and upon payout of outstanding long-term performance share awards, the weighted-average exercise price of outstanding stock options, and the number of common shares remaining available for future issuance, excluding common shares issuable upon exercise of outstanding stock options or upon payout of outstanding long-term performance share awards, in each case as of May 31, 2019.2022. The following table also shows for the Employee Deferral Plans and the Director Deferral Plans, as a group, the number of whole common shares issuable upon payout of amounts credited to theoretical common shares in the accounts of participants in the Employee Deferral Plans and the Director Deferral Plans, as of May 31, 2019.2022.
Equity Compensation Plan Information
Plan Category | Number Of Common Shares To Be Issued Upon Exercise Of Outstanding Options, Warrants And Rights | Weighted-Average Exercise Price Of Outstanding Options, Warrants And Rights | Number Of Common Shares Remaining Available For Future Issuance Under Equity Compensation Plans [Excluding Common Shares Reflected In Column (a)] | Number Of Common Shares To Be Issued Upon Exercise Of Outstanding Options, Warrants And Rights | Weighted-Average Exercise Price Of Outstanding Options, Warrants And Rights | Number Of Common Shares Remaining Available For Future Issuance Under Equity Compensation Plans [Excluding Common Shares Reflected In Column (a)] | ||||||||||||||||
| (a) | (b) | (c) | (a) | (b) | (c) | ||||||||||||||||
Equity compensation plans approved by shareholders |
| 1,982,189 |
| (1) | $24.01 |
| (2) |
| 2,675,247 |
| (3) |
| 937,850 |
| (1) | $39.66 | (2) |
| 3,475,702 |
| (3) | |
Equity compensation plans not approved by shareholders |
| 220,163 |
| (4) |
| — |
| (4) | — |
| (5) |
| 252,195 |
| (4) | – | (4) | – |
| (5) | ||
TOTAL |
| 2,202,352 |
| (1)(4) | $24.01 |
| (2)(4) |
| 2,675,247 |
| (3)(5) |
| 1,190,045 |
| (1)(4) | $39.66 | (2)(4) |
| 3,475,702 |
| (3)(5) |
(1) | Includes |
Does not include 857,596746,422 common shares which represent the maximum number of common shares which may be paid out in respect of long-term cash performance awards granted under the 1997 LTIP which were outstanding as of May 31, 2019,2022, because to date all such awards have been paid in cash. If all long-term cash performance awards granted under the 1997 LTIP which were outstanding as of May 31, 2019,2022, were paid out at their maximum amount and the Compensation Committee were to elect to make all payments in the form of common shares, then, based on the $34.14$46.64 closing price of the common shares on May 31, 2019,2022, the last business day of Fiscal 2019,2022, the number of common shares which would be issued upon payout of the long-term cash performance awards would be 857,596746,422 common shares. The number of common shares, if any, actually issued with respect to long-term cash performance awards granted under the 1997 LTIP would be based on (a) the percentage of the long-term cash performance awards determined by the Compensation Committee to be paid in common shares rather than cash, (b) the actual performance level (i.e., threshold, target or maximum) used to determine the payout in respect of each long-term cash performance award and (c) the price of Worthington’sthe common shares at the time of payout.
(2) | Represents the weighted-average exercise price of stock options outstanding under the Equity Plans as of May 31, |
Equity Compensation Plan Information • |
|
(4) | Includes |
(5) | Neither the Employee Deferral Plans nor the Director Deferral Plans provide for a specified limit on the number of common shares which may be issued upon payout of amounts credited to theoretical common shares in the accounts of participants in those plans. |
| Worthington | |
Proposal 2: AdvisoryAdvisory Vote to ApproveExecutive the Compensation of the NEOs
We are asking shareholders to approve an advisory resolution to approve the Company’s executive compensation of the NEOs as reported in this Proxy Statement. As described in detail in the section captioned “EXECUTIVE COMPENSATION“Executive Compensation — Compensation Discussion and Analysis” beginning on page 33 of this Proxy Statement and in the “Fiscal 20192022 Summary Compensation Table” beginning on page 52 of this Proxy Statement and the accompanying tables and narrative in this Proxy Statement, our executive compensation programs are reviewed annually by our Compensation Committee, with advice from its independent compensation consultant and consideration given to executive compensation paid by other comparator companies. Our compensation programs are designed to foster the alignment of the interests of executive management with the interests of shareholders and to provide incentives, based primarily on Company and business unit performance, for reaching established Company and business unit goals and objectives. Shareholders are urged to read the “Compensation Discussion and Analysis” which describes in detail how the Company’sour executive compensation policies and procedures achieve our compensation objectives.
The direct relationship of the compensation earned by the Company’s NEOs to the Company’sour performance continues to be shown by the amounts of incentive compensation earned by the Company’s NEOs for Fiscal 2019,2022, Fiscal 20182021 and Fiscal 2017.2020.
Annual
We have continued to reward our shareholders by steadily increasing our quarterly dividend each year since Fiscal 2013. The dividend was increased $0.03 to $0.28 per share for each quarter of Fiscal 2022, and to $0.31 per share for the first quarter of Fiscal 2023. In addition, we continued our stock buy-back program in Fiscal 2022, repurchasing a total of 3,235,000 common shares last year.
Consistent with our compensation philosophy, annual incentive compensation earned by the NEOs continued to move in the direction of our results. Due to our very strong performance in Fiscal 2022, annual cash incentive bonuses paid to Corporatefor the NEOs for Fiscal 2019, as a percent of targeted levels, were down 11.3% from Fiscal 2018. Payout levels for Fiscal 2019 were 93%higher, with annual cash incentive bonuses earned at 200% of target, at Corporate, 89%following payouts of target at Steel Processing, and 82% at Pressure Cylinders.
Annual incentive bonuses paid to the Corporate NEOs for Fiscal 2018 as a percent of target levels were down 8.7%% from Fiscal 2017, as Fiscal 2018 was the second best EPS year in the Company’s history, trailing only the record Fiscal 2017. Payouts for Fiscal 2018 were 106%185% of target for Corporate, 103%Fiscal 2021 and 75% of target for Steel Processing, and 104% of target for Pressure Cylinders.Fiscal 2020.
Annual incentive bonuses paid to the NEOs for Fiscal 2017 were up from Fiscal 2016, as the Company achieved record annual EPS, with payouts being earned at 115% of target for Corporate, 130% of target for Steel Processing and 89% of target for Pressure Cylinders.
Performance | Payouts as Percentage of Target | ||||||||
Corporate | Steel | Legacy Pressure | |||||||
2018 | Solid year, with the then second best annual EPS results | 106% | 103% | 104% | |||||
2019 | Then third best annual EPS, but weaker year-over-year results | 93% | 89% | 82% | |||||
2020 | Results were weakened due to the impact of COVID-19 in the fourth quarter | 75% | 63% | 83% | |||||
2021 | Strong year despite COVID-19 related challenges | 185% | 183% | 166% | |||||
2022 | Very strong year despite COVID-19 and other challenges | Corporate | Steel Processing | Consumer Products | Building Products | Sustainable Energy Solutions | |||
200% | 200% | 168% | 189% | 100% |
Long-term cash performance and performance share awards were down significantly for the three-fiscal-year period ended Fiscal 2019, paying out at only 48% of target, following a payout of 92% of target for the three-fiscal-year period ended Fiscal 2018. Corporate long-term cash performance and performance share awards earned for the three-fiscal-year period ended Fiscal 2017 were paid out at 92% of target.
Proposal 2: Advisory Vote to Approve |
|
The following table lists, for each of Fiscal 2019, Fiscal 2018 and Fiscal 2017, the bonus and incentive compensation earned by the NEOs under their total cash bonus awards for those fiscal years and their three-fiscal-year cashstrong results also had a significant positive impact on long-term performance and performance share awards for the three-fiscal-year periodsperiod ended with such fiscal years. SeeFiscal 2022. For the “Fiscal 2019 Summary Compensation Table” beginning on page 52NEOs, these awards paid out at maximum, similar to Fiscal 2021. This followed the three-fiscal-year period ended Fiscal 2020, which had no long-term incentive payout (other than 52% for additional information on compensationlegacy Pressure Cylinders) due to the negative impact of COVID-19 in the NEOs.fourth quarter.
Earned Incentive Compensation
|
|
|
|
|
|
|
|
|
| 3-Year Performance Share Award Earned |
| |||||
Name and Principal Position During Fiscal 2019 | Fiscal Year | Annual Incentive Bonus Earned ($) | 3-Year Cash Performance Award Earned ($) | (# of Shares) | Value on Date Distributed ($)(1) |
| ||||||||||
John P. McConnell, | 2019 |
| 877,723 |
|
|
| 484,000 |
|
|
| 7,260 |
|
|
| 292,505 |
|
Chairman of the Board | 2018 |
| 970,666 |
|
|
| 935,000 |
|
|
| 18,700 |
|
|
| 801,295 |
|
and Chief Executive Officer | 2017 |
| 1,015,127 |
|
|
| 923,000 |
|
|
| 15,691 |
|
|
| 788,002 |
|
Joseph B. Hayek, | 2019 |
| 291,287 |
|
|
| 55,909 |
| (2) |
| 501 |
|
|
| 20,185 |
|
Vice President and | 2018 | N/A |
|
| N/A |
|
| N/A |
|
| N/A |
| ||||
Chief Financial Officer (3) | 2017 | N/A |
|
| N/A |
|
| N/A |
|
| N/A |
| ||||
B. Andrew Rose, | 2019 |
| 657,546 |
| (4) |
| 290,400 |
|
|
| 3,630 |
|
|
| 146,253 |
|
President and Former | 2018 |
| 632,236 |
|
|
| 561,000 |
|
|
| 9,350 |
|
|
| 400,648 |
|
Chief Financial Officer (5) (6) | 2017 |
| 661,127 |
|
|
| 553,800 |
|
|
| 6,461 |
|
|
| 324,471 |
|
Geoffrey G. Gilmore, | 2019 |
| 557,265 |
| (4) |
| 161,700 |
| (2) |
| 1,513 |
|
|
| 60,959 |
|
Executive Vice President and | 2018 |
| 525,672 |
|
|
| 149,600 |
|
|
| 2,493 |
|
|
| 106,825 |
|
Chief Operating Officer (6) (7) | 2017 |
| 480,000 |
| (8) |
| 143,065 |
|
|
| 1,431 |
|
|
| 71,865 |
|
Virgil L. Winland, | 2019 |
| 445,896 |
|
|
| 111,320 |
|
|
| 1,271 |
|
|
| 51,209 |
|
Senior Vice President, | 2018 |
| 493,164 |
|
|
| 215,050 |
|
|
| 3,273 |
|
|
| 140,248 |
|
Manufacturing | 2017 |
| 515,700 |
|
|
| 212,290 |
|
|
| 1,846 |
|
|
| 92,706 |
|
Dale T. Brinkman, | 2019 |
| 396,352 |
|
|
| 96,800 |
|
|
| 1,271 |
|
|
| 51,209 |
|
Senior Vice President-Administration, | 2018 | N/A |
|
| N/A |
|
| N/A |
|
| N/A |
| ||||
General Counsel and Secretary (9) | 2017 | N/A |
|
| N/A |
|
| N/A |
|
| N/A |
| ||||
Mark A. Russell, Former | 2019 |
| 0 |
|
|
| 209,733 |
|
|
| 2,622 |
|
|
| 105,640 |
|
President and Chief | 2018 |
| 767,144 |
|
|
| 561,000 |
|
|
| 9,350 |
|
|
| 400,648 |
|
Operating Officer (10) | 2017 |
| 802,200 |
|
|
| 553,800 |
|
|
| 6,461 |
|
|
| 324,471 |
|
John G. Lamprinakos, | 2019 |
| 0 |
|
|
| 51,761 |
|
|
| 791 |
|
|
| 31,869 |
|
Former President, The | 2018 |
| 386,625 |
|
|
| 124,667 |
|
|
| 2,244 |
|
|
| 96,155 |
|
Worthington Steel Company (11) | 2017 |
| 415,040 |
|
|
| 119,221 |
|
|
| 1,192 |
|
|
| 59,862 |
|
Performance Period (Fiscal Years) | Performance |
Corporate |
Steel |
Legacy Pressure |
2016-2018 | Solid year in Fiscal 2018 (then second best reported annual EPS) following two prior then record years, but payouts were below higher target | 94% | 47% | 47% |
2017-2019 | Weaker results in Fiscal 2019 kept payouts below target despite strong years in Fiscal 2018 and Fiscal 2017 | 48% | 24% | 24% |
2018-2020 | COVID-19 weakened results for Fiscal 2020 negatively affected entire period | 0% | 0% | 52% |
2019-2021 | Strong results in Fiscal 2021 lifted results for the entire period | 200% | 173% | 144% |
2020-2022 | Strong results in Fiscal 2021 and Fiscal 2022 lifted results for the entire period | 200% | 191% | 200% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performance and payments earned from Fiscal 2015 to Fiscal 2019 are discussed in the section captioned “EXECUTIVE COMPENSATION — Compensation and Disclosure Analysis — Cash Compensation Earned in Fiscal 2019 and Company Performance” beginning on page 37 of this Proxy Statement.
The Company hasWe have been fairly conservative in providing severance benefits and perquisites to itsour executives. For example, it eliminated Company-provided automobiles for top executives in 2007. The CompanyAs such, we generally hashave not entered into separate severance agreements with itsour executive officers and hashave provided change in control benefits only in connection with its incentive awards. The Compensation Committee has required a “double trigger” for accelerated vesting forof awards granted in Fiscal 2013 and later. In the event of a change in control, these incentive awards will also require an actual or constructive termination of employment within a specified period of time after the change in control in order for the acceleration of vesting to occur.
The vote on the advisory resolution relates to the compensation of our NEOs as a whole. The vote is advisory, which means that the vote is not binding on the Company,us, the Board or the Compensation Committee. To the extent there is any significant vote against the NEOs’ compensation for Fiscal 20192022 as reported, the Compensation Committee will evaluate whether any actions are necessary to address the concerns of shareholders.
In accordance with the Exchange Act Rule 14a-21(a), the Company iswe are asking shareholders to approve the following advisory resolution at the Annual Meeting:
RESOLVED, that the shareholders of Worthington Industries, Inc. (the “Company”) approve, on an advisory basis, the compensation of the Company's named executive officers as disclosed in the Company's proxy statement for its 20192022 Annual Meeting of Shareholders pursuant to the executive compensation disclosure rules in Item 402 of SEC Regulation S-K (including the Compensation“Compensation Discussion and Analysis,Analysis”, the Fiscal 2019“Fiscal 2022 Summary Compensation TableTable” and the related executive compensation tables, notes and narratives).
The Board’s current policy is to include an advisory resolution regarding approval of the compensation of our NEOs annually. Accordingly, unless the Board modifies its policy on the frequency of future votes, the next advisory vote to approve our executivethe compensation of the neos will occur at the 20202023 Annual Meeting of Shareholders.Meeting.
72 | Worthington | 2022 Proxy Statement • Proposal 2: Advisory Vote to Approve the Compensation of the NEOs |
Required Vote and Board’s Recommendation
The affirmative vote of the holders of a majority of the votes entitled to be cast by the holders of the outstanding common shares, present in person or represented by proxy and entitled to vote on the proposal is required to approve the advisory resolution on NEO compensation. AbstentionsThe properly executed proxy of a holder of the common shares entitled to vote on the proposal marked “abstain” with respect to Proposal 2 will not be voted with respect to such matter. Accordingly, for purposes of Proposal 2, abstentions will be counted in determining the required vote and will have the effect of votes “AGAINST”a vote “against” the advisory resolution. Broker non-votes will not be counted in determining the required vote.
THE COMPENSATION COMMITTEE AND THE BOARD UNANIMOUSLY
RECOMMEND THAT THEOUR SHAREHOLDERS OF THE COMPANY VOTE“FOR” THE APPROVAL
OF THE ADVISORY RESOLUTION ON EXECUTIVE COMPENSATION.
TO APPROVE THE COMPENSATION OF THE NEOs.
Proposal 2: Advisory Vote to Approve |
|
Proposal 3: Approvalof FourthAmendmenttothe WorthingtonIndustries, Inc. Amended and Restated 1997 Long-Term Incentive Plan to Authorize 1,500,000 Additional Common Shares
Introduction
The Worthington Industries, Inc. 1997 Long-Term Incentive Plan became effective on September 18, 1997, when it was approved by Worthington’s shareholders. The 1997 Long-Term Incentive Plan was amended and restated by the Board effective as of November 1, 2008, for purposes of complying with the requirements of Section 409A of the Internal Revenue Code, and to make other administrative changes. On June 25, 2013, the Board approved the First Amendment to the Amended and Restated 1997 Long-Term Incentive Plan which changed and clarified the performance goals under the Plan upon which the granting or vesting of awards may be based, and on September 26, 2013, Worthington’s shareholders approved the material terms of the performance goals in the First Amendment. In addition, on September 26, 2013, Worthington’s shareholders approved the Second Amendment to the Amended and Restated 1997 Long-Term Incentive Plan to increase the number of common shares available for settlement of awards, modify the method for counting common shares subject to non-qualified stock options and stock appreciation rights against the total number of common shares available for awards, and modify certain other provisions to reflect current market standards. On June 28, 2017, the Board approved the Third Amendment to the Amended and Restated 1997 Long-Term Incentive Plan in order to clarify the authority of the Company and the Compensation Committee with respect to withholding for taxes. The Amended and Restated 1997 Long-Term Incentive Plan, as amended by the First Amendment, the Second Amendment, and the Third Amendment, is referred to in this Proxy Statement as the “1997 LTIP”.
Additional common shares are needed under the 1997 LTIP to continue to make grants to employees consistent with historic grant practices. On June 26, 2019, based on the recommendation of the Compensation Committee, the Board approved the Fourth Amendment to the 1997 LTIP, subject to approval by Worthington’s shareholders. The Fourth Amendment would increase the maximum number of common shares available for settlement of awards under the 1997 LTIP to 8,000,000, an increase of 1,500,000 common shares.
Summary of Proposed Fourth Amendment
The following summary of the amendment to the 1997 LTIP encompassed in the Fourth Amendment is qualified in its entirety by reference to the full text of the Fourth Amendment, a copy of which is attached to this Proxy Statement within Appendix II.
Increase in Authorized Common Shares
As currently in effect, the 1997 LTIP provides that, subject to adjustment as described under the caption “Common Shares Subject to 1997 LTIP” beginning on page 81 of this Proxy Statement, the maximum number of common shares available for settlement of awards under the 1997 LTIP is 6,500,000 common shares. As of August 1, 2019, 738,310 common shares remained available for future awards under the 1997 LTIP (which number excludes 276,700 common shares representing the maximum number of common shares which may be paid out in respect of outstanding performance share awards granted under the 1997 LTIP, and excludes common shares subject to outstanding options and restricted common shares).
|
|
The purpose of the Fourth Amendment is to increase the maximum number of common shares available for award under the 1997 LTIP. The additional 1,500,000 common shares which would be authorized upon approval of the Fourth Amendment would allow the Company to continue to provide under the 1997 LTIP long-term, equity-based incentives to eligible employees, which we believe is in the best interests of our shareholders.
Currently, the 1997 LTIP is the only Company equity compensation plan under which equity grants, other than stock options, may be made to employees. As of August 1, 2019, there were 738,310 common shares available for future awards under the 1997 LTIP. Under expected practices, the Company anticipates that the common shares available for settlement of awards under the 1997 LTIP if the Fourth Amendment is approved to be sufficient to satisfy the equity grants, in the form of performance shares and restricted common shares, expected to be made over the next four to six years. This period of expected award coverage will be impacted by the number of restricted common shares forfeited and the levels at which performance shares are earned over the period.
The number of common shares available for settlement of awards under the 1997 LTIP was last increased six years ago in 2013, when the number available was increased by 2,000,000 common shares.
Summary of 1997 LTIP
Set forth below is a brief summary of the material features of the 1997 LTIP, as proposed to be amended by the Fourth Amendment. This summary is qualified in its entirety by reference to the full text of the 1997 LTIP, as proposed to be amended by the Fourth Amendment. Copies of the 1997 LTIP and the Fourth Amendment are included within Appendix II to this Proxy Statement. All capitalized terms which are not defined in this summary are defined in the 1997 LTIP, as proposed to be amended by the Fourth Amendment.
Purpose of 1997 LTIP
The purpose of the 1997 LTIP is to enhance the value of the Company for the benefit of Worthington’s shareholders by generating an increased incentive to key employees of the Company to encourage selected key employees of the Company to acquire a proprietary and vested interest in the growth and performance of the Company, to generate an increased incentive to contribute to the Company’s future success and prosperity, thus enhancing the value of the Company for the benefit of Worthington’s shareholders, and to enhance the ability of the Company to attract and retain talented individuals upon whom the sustained progress, growth and profitability of the Company depends. The 1997 LTIP will remain in effect until terminated by the Board.
Administration
The 1997 LTIP is administered by the Compensation Committee. The Compensation Committee has the authority to select the employees to whom awards are granted, to determine the type of awards granted and the number of common shares covered by such awards, to set the terms, conditions and provisions of such awards and to cancel or suspend awards, in each case in a manner not inconsistent with the 1997 LTIP. The Compensation Committee is authorized to interpret the 1997 LTIP and to establish, amend and rescind any rules and regulations relating to the 1997 LTIP, to determine the terms and provisions of any agreements entered into with participants in the 1997 LTIP, and to make all other determinations which may be necessary or advisable for the administration of the 1997 LTIP. Any determination made by the Compensation Committee will be final and conclusive.
Eligibility
Any common law employee of the Company, a 50%-owned direct or indirect subsidiary of the Company, or any other entity in which the Company has a 20% or greater direct or indirect equity interest and which is designated as a “subsidiary” by the Compensation Committee for purposes of the 1997 LTIP, is eligible to be selected by the Compensation Committee to receive an award under the 1997 LTIP. No entity in which the Company has less than a 50% equity interest has been designated as a “subsidiary” for purposes of the 1997 LTIP.
As of the date of this Proxy Statement, the Company, together with its 50%-owned subsidiaries, had approximately 1,400 employees eligible for awards under the 1997 LTIP. Because the granting of awards under the 1997 LTIP is discretionary, the number of employees granted awards under the 1997 LTIP and the number of common shares subject to awards granted to each participant has varied and will continue to vary from year to year.
|
|
Under the 1997 LTIP, the Compensation Committee may grant the following types of awards: (a) non-qualified stock options (“NSOs”); (b) stock appreciation rights (“SARs”), in tandem with NSOs or free-standing; (c) restricted common shares (also referred to as “restricted stock”); (d) performance awards (in the form of performance shares or performance units) subject to the achievement of performance goals during a specified performance period; and (e) other awards of common shares or awards valued in whole or in part by reference to, or otherwise based upon, common shares or other property. Although the 1997 LTIP permitted the granting of incentive stock options prior to August 7, 2007, no incentive stock options were granted under the 1997 LTIP.
NSOs
The Compensation Committee may grant NSOs either alone or in addition to other awards. As of August 1, 2019, NSOs covering an aggregate of 199,991 common shares were outstanding under the 1997 LTIP and NSOs covering an aggregate of 2,545,409 common shares granted under the 1997 LTIP had been exercised since the 1997 LTIP’s adoption in 1997. No NSOs have been granted under the 1997 LTIP since 2010. The exercise price (sometimes also referred to as the “option price”) of any NSO granted is to be determined by the Compensation Committee, but may not be less than 100% of fair market value of Worthington’s common shares on the date of the grant of the NSO. For purposes of the 1997 LTIP, the fair market value of a Worthington common share on a particular date has been and will continue to be the closing sale price as reported on NYSE (or such other principal exchange on which the common shares may then be traded). The closing sale price of Worthington’s common shares as reported on NYSE on August 1, 2019 was $39.24. The term of any NSO granted is to be fixed by the Compensation Committee and may not exceed ten years after the grant date. NSOs become exercisable at such time or times as determined by the Compensation Committee and may be exercised by payment in full of the exercise price, either in cash or, in whole or in part, in common shares or other consideration (including, if permitted by applicable law, outstanding vested and exercisable awards) having a fair market value on the date the NSO is exercised equal to the exercise price.
SARs
The Compensation Committee may grant SARs which are either free-standing or granted in tandem with NSOs (either at the time of or after the grant of the related NSO but prior to the exercise, termination or expiration of the related NSO). No SARs have been granted under the 1997 LTIP to date. Upon exercise of any SAR that is granted, the holder will be entitled to receive the excess of the fair market value of the common shares for which the SAR is exercised as of the exercise date over the grant price of the SAR. The grant price (which may not be less than the fair market value of Worthington’s common shares on the date of grant) and other terms of any SAR granted will be determined by the Compensation Committee. The term of any SAR granted will be limited to ten years after the grant date. Payment by the Company upon the exercise of any SAR granted will be made in cash, common shares, other property or any combination thereof, as the Compensation Committee determines. Any SAR related to an NSO will terminate and no longer be exercisable upon the exercise or termination of the related NSO and any NSO related to an SAR will terminate and no longer be exercisable upon the exercise or termination of the related SAR.
Restricted Stock
The Compensation Committee may grant restricted stock awards either alone or in addition to other awards. As of August 1, 2019, restricted stock awards covering an aggregate of 1,080,625 common shares were outstanding but unvested under the 1997 LTIP and restricted stock awards granted under the 1997 LTIP covering 1,102,894 common shares had vested. Restricted stock may not be transferred by the recipient until the restrictions established by the Compensation Committee lapse. Unless otherwise determined by the Compensation Committee, recipients of restricted stock awards are not required to provide consideration other than the rendering of services or the payment of any minimum amount required by law. Each recipient of a restricted stock award will have all of the rights of a Worthington shareholder, including the right to vote the underlying common shares and the right to receive any cash dividends related to the underlying common shares, unless the Compensation Committee otherwise determines. If a participant’s employment terminates during the restriction period, the participant will forfeit all restricted stock and any related dividends still subject to restriction, unless otherwise authorized by the Compensation Committee.
|
|
The Compensation Committee may grant performance awards either alone or in addition to other awards. The Compensation Committee has granted performance awards to certain employees of the Company each year since the 1997 LTIP became effective. The Compensation Committee granted performance share awards for the first time beginning with the three-fiscal-year period beginning June 1, 2006. The Compensation Committee has selected and anticipates that it will continue to select primarily multiple-year performance periods during which performance goals determined by the Compensation Committee are measured for the purpose of determining the extent to which a performance award has been earned. The performance periods associated with the performance awards granted under the 1997 LTIP have generally covered three fiscal years, although the Compensation Committee has also periodically selected six-month and quarterly performance awards. The performance levels to be achieved for each performance period and the amount of the performance award to be distributed are determined by the Compensation Committee. Performance awards may be paid in cash, common shares or a combination thereof, as the Compensation Committee determines.
The Compensation Committee will specify in the award agreement the impact of a participant’s termination of employment upon the outstanding performance awards held by the participant. The outstanding performance award agreements generally provide that upon termination of employment, a participant’s performance awards are forfeited. However, if termination of employment is due to death, disability or retirement, a pro-rata payout will be made for performance periods ending within 24 months after termination based on the number of months of employment completed by the participant during the performance period before the effective date of termination, provided that the applicable performance goals are achieved. No payout is to be made for performance periods ending more than 24 months after termination of employment.
The Compensation Committee anticipates continued consideration of grants of long-term performance share awards and cash performance awards under the 1997 LTIP, in each case to be based on achieving measurable financial results over a multiple-year period. Unless otherwise determined by the Compensation Committee, recipients of performance awards are not required to provide consideration other than the rendering of services or the payment of any minimum amount required by law.
Other Stock Unit Awards
To enable the Company and the Compensation Committee to respond quickly to significant developments in applicable tax and other legislation and regulations and interpretations thereof, and to trends in executive compensation practices, the Compensation Committee is also authorized to grant to participants, either alone or in addition to other awards granted under the 1997 LTIP, awards of common shares and other awards that are valued in whole or in part by reference to, or are otherwise based on, common shares or other property (“other stock unit awards”). Other stock unit awards may be issued for no cash consideration or for such minimum consideration as may be required by applicable law or for such other consideration as determined by the Compensation Committee and may be settled in common shares, cash or any other form of property in the discretion of the Compensation Committee. Common shares (including securities convertible into common shares) purchased pursuant to purchase rights granted under other stock unit awards may be purchased for such consideration as the Compensation Committee determines, which price may not be less than the fair market value of such common shares or other securities on the date of grant.
Performance Goals
The 1997 LTIP provides that if the Compensation Committee determines at the time a restricted stock award, a performance award or an other stock unit award is granted to a participant that the participant is or is likely to be a “covered employee” at the time the participant recognizes income for federal income tax purposes in connection with the award, then the Compensation Committee may provide as to such award that the lapsing of restrictions thereon and the distribution of cash or common shares pursuant thereto, as applicable, will be subject to the achievement of one or more objective performance goals established by the Compensation Committee. These performance goals may be based on the achievement levels of one or any combination of the following:
Income or earnings (before or after interest, taxes, depreciation, amortization and/or other items);
Earnings per common share;
Economic value added;
|
|
Growth;
Operating income;
Return measures (including, but not limited to, return on assets, capital, invested capital, equity or revenue);
Cash flow (including, but not limited to, operating cash flow, free cash flow, cash flow return on equity or cash flow return on investment);
Gross, operating or other margins;
Productivity ratios or other productivity measures;
Common share price (including, but not limited to, growth measures and total shareholder return);
Expense reduction, expense targets or cost control;
Operating or other efficiencies;
Market share;
Developing new markets, new products and/or new lines of revenue; or
Identifying and completing acquisitions.
Different performance criteria may be used for performance awards granted to individual participants or to groups of participants. Performance criteria may be applied solely with reference to the Company or an affiliate, business unit or division of the Company or relatively between the Company or an affiliate, business unit or division of the Company and one or more unrelated entities, business units or indices and may state performance objectives in absolute terms or relative to comparison entities, indices or other measures to be achieved during a performance period.
The Compensation Committee may provide in any performance award that the evaluation of performance may include or exclude the impact of specific items related to the performance period including the following: (a) asset write-downs; (b) litigation or claim judgments or settlements; (c) changes in or the effects of tax laws, accounting principles (or interpretations thereof), accounting methods (including the differences between LIFO and FIFO accounting methods), or other laws or provisions affecting reported results; (d) any reorganization or restructuring program or restructuring costs; (e) unusual or infrequently occurring items; (f) acquisitions or divestitures; and (g) foreign exchange gains and losses.
To the extent inclusions or exclusions affect performance awards to covered employees, they will be prescribed in a form that meets the requirements of Section 162(m), to the extent applicable. Additionally, the Compensation Committee will, to the extent permitted under Section 162(m), make appropriate adjustments to the performance criteria and/or performance objectives to reflect any stock dividend, stock split, recapitalization, merger, consolidation, combination, spin-off, distribution of assets to shareholders, exchange of shares or similar corporate change.
Limitations on Number and Amount of Awards
Under the 1997 LTIP, no participant may be granted awards in any one calendar year with respect to more than 200,000 common shares. In addition, the maximum value of the property, including cash, that may be paid or distributed to any participant pursuant to a grant of performance awards valued by reference to a designated amount of property other than common shares (“performance units”) made in any one calendar year is $2,500,000.
|
|
Common Shares Subject to 1997 LTIP
Subject to adjustment as described below, the 1997 LTIP currently provides that the maximum number of common shares available for settlement of awards over the life of the 1997 LTIP is 6,500,000 common shares. As of August 1, 2019:
With respect to NSO awards, 199,991 common shares were subject to outstanding NSOs which had not yet been exercised, all of which were granted before September 26, 2013;
With respect to restricted common share awards: (a) 1,080,625 restricted common shares were outstanding and had not yet vested; and (b) 1,102,894 common shares had been delivered upon the vesting of restricted common shares;
With respect to performance share awards: (a) 276,700 common shares represented the maximum number of common shares which may be paid out in respect of outstanding performance share awards as to which the applicable performance periods had not ended; and (b) 1,492,692 common shares were earned and issued, based upon the performance levels which had been attained in respect of completed performance periods, since the 1997 LTIP’s adoption in 1997.
As of August 1, 2019, a total of 738,310 common shares were available for future awards under the 1997 LTIP. The Fourth Amendment to the 1997 LTIP, if approved by the shareholders of the Company, will increase the maximum number of common shares available for settlement of awards under the 1997 LTIP by 1,500,000 to 8,000,000 common shares.
Except as described below, if any common shares subject to any award under the 1997 LTIP are forfeited or withheld for taxes, any award terminates or expires unexercised or any award is settled for cash or other property or exchanged for other awards, the common shares subject to such award will again be available for grant pursuant to the 1997 LTIP. The number of common shares available for awards under the 1997 LTIP will be increased by the number of common shares withheld by or tendered to the Company in connection with the payment of the exercise price of an NSO granted before September 26, 2013 under the 1997 LTIP. Common shares which are the subject of NSOs or SARs granted on or after September 26, 2013 are not available for future awards under the 1997 LTIP, even if such NSO or SAR is forfeited, terminated, expires unexercised, settled in cash or property other than common shares or exchanged for another award or the common shares subject to such NSO or SAR can otherwise no longer be issued.
The common shares deliverable under the 1997 LTIP may consist in whole or in part of either authorized and unissued common shares or issued common shares which have been reacquired by the Company. No fractional common shares will be issued under the 1997 Plan.
In the event of any stock dividend, stock split, recapitalization, reorganization, merger, consolidation, spin-off, reverse stock split, exchange of shares or similar transaction, or other change in corporate structure or capitalization affecting the common shares or the price thereof, the Compensation Committee will make such substitution or adjustment in the aggregate number or class of shares which may be delivered under the 1997 LTIP, in the aggregate or to any one participant and in the number, class and option price or exercise price of shares subject to the outstanding awards granted under the 1997 LTIP (including the substitution of similar options to purchase the shares of, or other awards denominated in the shares of, another company) as the Compensation Committee deems to be appropriate to maintain the purpose of the original grant. Any such adjustment will be made consistent with the requirements of Section 409A of the Internal Revenue Code, to the extent applicable.
The Compensation Committee, without obtaining shareholder approval and except for the adjustments made as described in the immediately preceding paragraph, may not (i) amend the terms of an outstanding award to reduce the option price of an outstanding NSO or the grant price of an outstanding SAR; (ii) cancel an outstanding NSO or SAR in exchange for NSOs or SARs with an option price or grant price, as applicable, that is less than the option price or grant price of the original NSO or SAR; (iii) cancel an outstanding NSO or SAR with an option price or grant price, as applicable, which is above the current fair market value of the common shares underlying the NSO or SAR in exchange for another award, cash or other securities; (iv) take any other action that is treated as a “repricing” under generally accepted accounting principles; or (v) take any other action that has the effect of “repricing” an award, as defined under the applicable NYSE Rules (or the rules of any other securities exchange on which the common shares are then listed or traded).
|
|
The Compensation Committee is authorized to make adjustments in performance award goals or in the terms and conditions of other awards in recognition of unusual or infrequently occurring events affecting the Company or its financial statements or changes in applicable laws, regulations or accounting principles. However, with respect to any award subject to performance goals intended to comply with Section 162(m), the Compensation Committee may not adjust upwards the amount payable under the award, nor may the Compensation Committee waive the achievement of the applicable performance goals except in the case of the death or disability of the participant. The Compensation Committee may correct any defect, supply any omission, or reconcile any inconsistency in the 1997 LTIP or any award in the manner and to the extent the Compensation Committee deems desirable to carry the applicable grant into effect.
Awards to Foreign Nationals
Awards may be granted to employees of the Company who are foreign nationals or employed outside the United States, or both, on such terms and conditions different from those specified in the 1997 LTIP as may be necessary or desirable, in the judgment of the Compensation Committee, to recognize differences in local law or tax policy.
Benefits Under the 1997 LTIP
The Compensation Committee has discretionary authority to grant awards under the 1997 LTIP. The 1997 LTIP does not contain any provisions for automatic grants. As a result, the future awards, benefits or amounts that may be received by any individual participant or group of participants are not determinable.
For information regarding the restricted stock awards, cash performance awards and performance share awards made under the 1997 LTIP for Fiscal 2020 to: (i) each NEO; (ii) all current executive officers as a group, including the NEOs (the “Executive Group”); and (iii) all employees, including all current officers who are not executive officers, as a group (the “Non-Executive Officer Employee Group”), see the table captioned “Long-Term Performance Awards, Option Awards and Restricted Common Share Awards Granted in Fiscal 2020” beginning on page 66 of this Proxy Statement. All of the awards were granted for compensatory purposes.
Because future grants of awards under the 1997 LTIP will be made to employees by the Compensation Committee based on a subjective determination of the relative current and future contribution that each employee has made and may make to the long-term welfare of the Company, past grants may not be reflective of future grants under the 1997 LTIP. The Compensation Committee may, in its discretion, continue to grant cash performance awards and/or performance share awards with payouts tied to the same performance goals used for past grants or select other performance goals from among those described under “Performance Goals” above.
Stock Options Granted under the 1997 LTIP
Since 2010, the Compensation Committee has made stock option awards to NEOs and other employees under one of the Company’s stock option plans. Some stock options were granted under the 1997 LTIP in 2010 and before. The table below summarizes NSOs that have been awarded under the 1997 LTIP since its inception:
|
|
|
| |||
|
| |||
|
| |||
|
| |||
|
| |||
|
| |||
|
| |||
|
| |||
|
| |||
|
| |||
|
| |||
|
|
|
|
For information regarding NSOs and restricted stock awards granted to the NEOs in Fiscal 2019, see the “Grants of Plan-Based Awards for Fiscal 2019” table beginning on page 56 of this Proxy Statement. For information regarding cash performance awards earned by NEOs for the three-fiscal-year performance periods ended May 31, 2019, May 31, 2018 and May 31, 2017, see the “Fiscal 2019 Summary Compensation Table” beginning on page 52 of this Proxy Statement. For information regarding the common shares earned with respect to performance share awards granted to the NEOs for the three-fiscal-year performance period ended May 31, 2019, see the “Option Exercises and Stock Vested for Fiscal 2019” table beginning on page 62 of this Proxy Statement. For information regarding unexercised NSOs, unvested restricted stock awards and unvested performance share awards held by each of the NEOs as of May 31, 2019, see the “Outstanding Equity Awards at Fiscal 2019 Year-End” table beginning on page 58 of this Proxy Statement. For information regarding NSOs, restricted stock awards, cash performance awards and performance share awards granted to the NEOs in Fiscal 2020 through the date of this Proxy Statement, see the “Long-Term Performance Awards, Option Awards and Restricted Common Share Awards Granted in Fiscal 2020” table beginning on page 66 of this Proxy Statement.
Nonassignability of Awards
Unless the Compensation Committee determines otherwise at the time an award is granted, no award granted under the 1997 LTIP may be sold, assigned, transferred, pledged or otherwise encumbered by a participant, otherwise than by will, by designation of a beneficiary to exercise the participant’s rights with respect to the award after the participant’s death, or by the laws of descent and distribution. Each award is exercisable, during a participant’s lifetime, only by the participant or, if permissible under applicable law, by the participant’s guardian or legal representative.
|
|
The Board may amend, alter or discontinue the 1997 LTIP, provided that no such action may impair the rights of a participant under an outstanding award without the participant’s consent. In addition, without shareholder approval, no amendment may be made which would (i) increase the total number of common shares reserved for delivery under the 1997 LTIP, (ii) change the class of employees eligible to participate in the 1997 LTIP, or (iii) otherwise require shareholder approval under applicable law or to satisfy applicable requirements imposed by Section 162(m) or the rules of any securities exchange on which Worthington’s securities are listed or traded. The Compensation Committee may amend the terms of any outstanding award, prospectively or retroactively, but no such amendment may impair the rights of any participant without the participant’s consent.
Change in Control
To maintain the participants’ rights, unless the Compensation Committee determines otherwise at the time of grant with respect to a particular award, in the event of a “change in control” of the Company followed by an actual or constructive termination of employment (a “Change in Control Termination”):
any NSOs and SARs outstanding as of the date of a Change in Control Termination, and which are not then exercisable and vested, will become fully exercisable and vested to the full extent of the original grant; however, if an SAR is held by a participant who is subject to Section 16(b) of the Exchange Act (a “Section 16(b) participant”), the SAR will not become fully vested and exercisable unless the SAR has been outstanding for at least six months;
the restrictions applicable to any restricted stock award will lapse, and the underlying common shares will become free of all restrictions and become fully vested and transferable to the full extent of the original grant;
all performance awards will be considered to be earned and payable in full, and any other restriction will lapse and the performance awards will be immediately settled or distributed; and
the restrictions and other conditions applicable to any other stock unit awards or any other awards will lapse, and the other stock unit awards or other awards will become free of all restrictions or conditions and become fully vested and transferable to the full extent of the original grant.
In addition, the Compensation Committee may allow participants holding NSOs to elect, during the 60-day period following the change in control, to surrender the NSOs (or any portion thereof) which have not been exercised in exchange for a cash payment equal to the change in control price per share (as defined in the 1997 LTIP) over the exercise price per share.
For purposes of the 1997 LTIP, a change in control of the Company will be deemed to have occurred when any person, alone or together with its affiliates or associates, has acquired or obtained the right to acquire the beneficial ownership of 25% or more of Worthington’s outstanding common shares, unless such person is:
the Company;
any employee benefit plan of the Company or a trustee of or fiduciary with respect to any such plan when acting in that capacity; or
any person who, on September 18, 1997, was an affiliate of the Company owning in excess of 10% of the Company’s outstanding common shares and the respective successors, executors, legal representatives, heirs and legal assigns of such person.
Cancellations and Forfeitures
The Compensation Committee has the power to determine whether, to what extent, and under what circumstances, any award is to be cancelled or suspended. In particular, but without limitation, all outstanding awards to any participant will be cancelled if the participant, without the consent of the Compensation Committee, while employed by the Company or after termination of such employment, becomes associated with, employed by, renders services to, or owns any interest in (other than any nonsubstantial interest, as determined by the Compensation Committee), any business that is in competition with the Company or with any business in which the Company has a substantial interest as determined by the Compensation Committee.
|
|
In the event a participant terminates the participant’s employment with the Company for any reason whatsoever, and within 18 months after the date thereof becomes associated with, employed by, renders services to, or owns any interest in (other than any nonsubstantial interest, as determined by the Compensation Committee), any business that is in competition with the Company or with any business in which the Company has a substantial interest as determined by the Compensation Committee, the Compensation Committee, in its sole discretion, may require such participant to return to the Company the economic value of any award which is realized or obtained (measured at the date of exercise or payment) by such participant at any time during the period beginning on that date which is six months prior to the date of such participant’s termination of employment with the Company.
Withholding for Taxes
The Company is authorized to withhold from any award granted or payment due under the 1997 LTIP the amount of withholding taxes due and to take such other action as may be necessary, in the opinion of the Company, to satisfy all obligations for the payment of such taxes. The Compensation Committee is authorized to establish procedures for election by participants to satisfy their respective withholding taxes by delivery of, or directing the Company to retain, common shares, unless otherwise specified by the Compensation Committee in the applicable award agreement. The authority described in this paragraph includes the authority to determine the amounts to be withheld (including common shares or other portions of awards) in satisfaction of a participant’s or former participant’s withholding obligations, or in satisfaction of other tax obligations, either on a mandatory or elective basis, as permitted in the discretion of the Compensation Committee.
U.S. Federal Income Tax Consequences
The following is a brief summary of the general U.S. federal income tax consequences relating to awards granted or which may be granted under the 1997 LTIP. This summary is based on U.S. federal tax laws and Treasury Regulations in effect on the date of this Proxy Statement and does not purport to be a complete description of the U.S. federal income tax laws. In addition, this summary is not intended to be exhaustive, does not constitute tax advice, and does not describe state, local or foreign tax consequences. Each participant should consult with his or her tax advisor concerning the tax consequences of participating in the 1997 LTIP.
NSOs
A participant will not recognize taxable income when an NSO is granted, and the Company will not receive a deduction at that time, assuming the NSO does not have a readily ascertainable fair market value at the time it is granted. When an NSO is exercised, a participant will recognize ordinary income equal to the excess, if any, of the fair market value of the underlying common shares on the date of exercise over the aggregate exercise price, and the Company will be entitled to a corresponding deduction. Additionally, the same amount will be subject to employment taxes, including social security and Medicare taxes. If a participant pays the exercise price, in whole or in part, with previously acquired common shares, the participant will recognize ordinary income equal to the value of the excess of the number of common shares that the participant receives upon exercise over the number of the common shares the participant surrenders, less any cash used to pay the exercise price.
SARs
A participant will not recognize taxable income when an SAR is granted, and the Company will not receive a deduction at that time. When an SAR is exercised, a participant will recognize ordinary income equal to the excess of the cash and/or the fair market value of the common shares the participant receives over the aggregate grant price of the SAR, if any, and the Company will be entitled to a corresponding deduction. Additionally, the same amount will be subject to employment taxes, including social security and Medicare taxes.
Restricted Stock
Generally, a participant who has been granted a restricted stock award will not recognize taxable income at the time of grant, and the Company will not be entitled to a deduction at that time, assuming that the restrictions create a “substantial risk of forfeiture” for federal income tax purposes and the participant does not make an election under Section 83(b) of the Internal Revenue Code. Generally, upon the lapse of the substantial risk of forfeiture, the participant will recognize ordinary income equal to the then fair market value of the underlying common shares, less any consideration paid for such common shares,
|
|
and the Company will be entitled to a corresponding deduction. Additionally, the same amount will be subject to employment taxes, including social security and Medicare taxes.
A participant may elect pursuant to Section 83(b) of the Internal Revenue Code to recognize ordinary income on the date of grant of a restricted stock award equal to the fair market value of the common shares underlying the award on the grant date (less any amount paid by the participant for the common shares underlying the award) and to have the applicable capital gain holding period commence as of that date. If a participant makes this election, the same amount will be subject to employment taxes, including social security and Medicare taxes, and the Company will be entitled to a corresponding deduction in the year of grant. If the restrictions on the restricted stock ultimately do not lapse, the participant may not take a tax deduction in connection with the forfeiture of the restricted stock subject to the election under Section 83(b) of the Internal Revenue Code.
Performance Shares and Performance Units
A participant will not recognize taxable income when performance shares or performance units are granted, and the Company will not receive a deduction at that time. In general, the participant will recognize ordinary income when the performance shares or performance units are settled equal to the cash or the fair market value of the common shares the participant receives upon settlement, less any consideration paid, and the Company will be entitled to a corresponding deduction. Additionally, the same amount will be subject to employment taxes, including social security and Medicare taxes.
Other Stock Unit Awards
A participant will not recognize taxable income when an other stock unit award is granted, and the Company will not receive a deduction at that time. In general, the participant will recognize ordinary income when the other stock unit award is settled equal to the cash or the fair market value of the common shares the participant receives upon settlement, less any consideration paid, and the Company will be entitled to a corresponding deduction. Additionally, the same amount will be subject to employment taxes, including social security and Medicare taxes.
Miscellaneous
When a participant sells the common shares received pursuant to the exercise or settlement of an award under the 1997 LTIP, the participant will generally recognize long-term capital gain or loss if, at the time of the sale, the participant has held the common shares for more than one year (or, in the case of a restricted stock award, more than one year from the date of the lapse of the substantial risk of forfeiture unless the participant made an election pursuant to Section 83(b) of the Internal Revenue Code as described above). If the participant held the common shares for one year or less, the gain or loss will be a short-term capital gain or loss.
Section 162(m)
Historically, certain awards granted under the 1997 LTIP had been designed to qualify as “performance-based compensation” for purposes of Section 162(m) so that any compensation expense related to such awards would be fully deductible by the Company. As described above, Section 162(m) generally limits the deduction that the Company may take for certain remuneration paid in excess of $1,000,000 to any “covered employee” of the Company in any one taxable year. Effective December 22, 2017, when the Tax Cuts and Jobs Act was signed into law, the performance-based compensation exception was generally eliminated with respect to future compensatory awards. There is an exception for remuneration provided pursuant to a written binding contract in effect on November 2, 2017 that is not modified in any respect after that date. Because of the ambiguities and uncertainties as to the application and interpretation of this transition relief, no assurance can be given that historic awards under the 1997 LTIP will avoid the deduction limit. The Company expects that a portion of the compensation expense related to future awards under the 1997 LTIP will not be deductible, even if performance-based.
Sections 280G and 4999 of the Internal Revenue Code
Sections 280G and 4999 of the Internal Revenue Code impose penalties on “excess parachute payments”. A parachute payment occurs when the “value” of all amounts paid to a “disqualified individual”, “in connection with a change in control”, each as defined under Section 280G of the Internal Revenue Code, is equal to or greater than three times the disqualified individual’s taxable compensation averaged over the five calendar years ending before the change in control (or over the disqualified individual’s entire period of service if that period is less than five calendar years). This average is called the
|
|
“Base Amount”. An excess parachute payment is the amount equal to the excess of any parachute payments over 100% of the Base Amount.
Under Section 4999 of the Internal Revenue Code, if a disqualified individual receives an excess parachute payment, the disqualified individual is subject to an excise tax equal to 20% of such excess parachute payment. This tax is due in addition to other federal, state and local income, wage and employment taxes. Also, under Section 280G of the Internal Revenue Code, the Company would not be able to deduct the amount of any disqualified individual’s excess parachute payment.
Recommendation and Vote Required to Approve the Fourth Amendment to the 1997 LTIP
The Board believes that the 1997 LTIP and the ability of the Compensation Committee to grant awards thereunder are important to keep the compensation and incentive plans of the Company competitive with those being offered by other comparable companies, thus enhancing the ability of the Company to attract and retain key employees having the experience and abilities necessary to manage the Company’s business.
The proposal being presented to Worthington’s shareholders for consideration as Proposal 3 would approve the Fourth Amendment to the 1997 LTIP. The proposal will be submitted to the Company’s shareholders in the form of the following resolution:
RESOLVED, that the Fourth Amendment to the Worthington Industries, Inc. Amended and Restated 1997 Long-Term Incentive Plan as included in the Company’s Proxy Statement for the Annual Meeting of Shareholders held on September 25, 2019, be, and the same hereby is, approved by the shareholders.
Shareholder approval of the Fourth Amendment to the 1997 LTIP will require the affirmative vote of the holders of a majority of the votes entitled to be cast by the holders of outstanding common shares, present in person or by proxy, and entitled to vote on the proposal. The effect of an abstention is the same as a vote “AGAINST” the proposal. Broker non-votes will not be counted in determining the number of common shares necessary for approval.
THE COMPENSATION COMMITTEE AND THE BOARD RECOMMEND THAT THE SHAREHOLDERS OF THE COMPANY VOTE “FOR” THE PROPOSAL TO APPROVE THE FOURTH AMENDMENT TO THE WORTHINGTON INDUSTRIES, INC. AMENDED AND RESTATED 1997 LONG-TERM INCENTIVE PLAN.
|
|
Proposal 4: Ratification of the Selection of Independent Registered Public Accounting Firm
The selection of the Company’sour independent registered public accounting firm is made annually by the Audit Committee after consulting with management and carefully considering that firm’s qualifications and independence. As a result, the Audit Committee has selected KPMG LLP (“KPMG”) to serve as the Company’sour independent registered public accounting firm for Fiscal 2020,2023 and recommends that theour shareholders of the Company ratify that selection. KPMG audited the Company’sour consolidated financial statements as of May 31, 20192022 and May 31, 20182021 and for each of the fiscal years in the three-yearthree-fiscal-year period ended May 31, 2019,2022, and the effectiveness of the Company’sour internal control over financial reporting as of May 31, 2019.2022. Representatives of KPMG are expected to be present at the Annual Meeting and will be given the opportunity to make a statement if they so desire and to respond to appropriate questions.
Required Vote and Board’s Recommendation
The affirmative vote of the holders of a majority of the votes entitled to be cast by the holders of outstanding common shares present in person or represented by proxy and entitled to vote on the proposal is required to ratify the selection of KPMG as the Company’sour independent registered public accounting firm for Fiscal 2020. 2023. The properly executed proxy of a holder of the common shares entitled to vote on the proposal marked “abstain” with respect to Proposal 3 will not be voted with respect to such matter. Accordingly, for purposes of Proposal 3, abstentions will be counted in determining the required vote and will have the effect of an abstention is the same as a vote “AGAINST”“against” the proposal.
Even if the selection of KPMG is ratified by the shareholders, the Audit Committee, in its discretion, could decide to terminate the engagement of KPMG and to engage another firm if the Audit Committee determines such action is necessary or desirable. If the selection of KPMG is not ratified, the Audit Committee will reconsider (but may decide to maintain) the selection.
THE AUDIT COMMITTEE AND THE BOARD UNANIMOUSLY RECOMMEND
THAT OUR SHAREHOLDERS OF THE COMPANY VOTE “FOR” THE RATIFICATION OF THE SELECTION OF KPMG.
| Worthington | |
Audit CommitteeCommittee Matters
Report of the Audit Committee for the Fiscal Year Ended May 31, 20192022
The Audit Committee oversees the Company’sour financial and accounting functions, controls, reporting processes and audits on behalf of the Board in accordance with the Audit Committee’s written charter. The Audit Committee is responsible for providing independent, objective oversight of the integrity and quality of the Company’sour consolidated financial statements, the qualifications and independence of the Company’sour independent registered public accounting firm, the performance of the Company’sour internal audit function and the Company’sour independent registered public accounting firm and the annual independent audit of the Company’sour consolidated financial statements. Management has the primary responsibility for the preparation, presentation and integrity of the Company’sour consolidated financial statements and the reporting process, for the appropriateness of theour accounting principles and reporting policies, that are used by the Company, for theour establishment and maintenance of an effective systemssystem of disclosure controls and procedures and internal control over financial reporting, and for the preparationissuance of theour annual report on management’sthe assessment of the effectiveness of the Company’sour internal control over financial reporting. The Company’sOur independent registered public accounting firm, KPMG, is responsible for auditing the Company’sour annual consolidated financial statements included in the Company’sour Annual Report on Form 10-K in accordance with the standards of the Public Company Accounting Oversight Board (United States) (the “PCAOB”) and issuing KPMG’sits report thereon based on such audit, for issuing an audit report on the effectiveness of the Company’sour internal control over financial reporting, and for reviewing the Company’sour unaudited interim consolidated financial statements included in the Company’sour Quarterly Reports on Form 10-Q.
In fulfilling its oversight responsibilities, the Audit Committee reviewed with management the Company’sour audited consolidated financial statements as ofat and for the fiscal year ended May 31, 20192022, and discussed with management the quality, not just the acceptability, of the accounting principles and policies as applied in the Company’sour financial reporting, the reasonableness of significant judgments and accounting estimates, and the clarity and completeness of disclosures in the consolidated financial statements.
In addition, the Audit Committee met with our management of the Company, the Company’sand internal auditors and KPMG throughout the year, with and without management of the Company present, to discuss the overall scope of their respective annual audit plans, the results of their respective audits, the effectiveness of the Company’sour internal control over financial reporting, including management’s and KPMG’s reports thereon and the bases for the conclusions expressed in those reports, and the overall quality of the Company’sour financial reporting. Throughout that period, the Audit Committee reviewed management’sthe plan of management for documenting and testing controls, the results of the documentation and testing, any deficiencies discovered and the resulting remediation of any such deficiencies. In addition, the Audit Committee reviewed and discussed with KPMG all matters required to be discussed by the applicable requirements of the PCAOB and the SEC.
The Audit Committee has discussed with KPMG the independence of that firm from our management and us. KPMG is subject to independence controls that mitigate the Company.risks that may be associated with long auditor tenure. The Audit Committee has received from KPMG the written disclosures and the lettercommunications from KPMG required by applicable PCAOB requirements regarding KPMG’s communications with the Audit Committee concerning independence. The Audit Committee has considered KPMG’s provision of permitted non-audit services to us (including our subsidiaries) and concluded that the provision of such services is compatible with maintaining KPMG’s independence. The Audit Committee has also discussed with KPMG any relationships with or other services to the Company or the Company’sus (including our subsidiaries or affiliatesaffiliates) that may impact the objectivity and independence of KPMG. The Audit Committee has satisfied itself as to the independence of KPMG.
Management of the CompanyOur management and KPMG have represented to the Audit Committee that the Company’sour audited consolidated financial statements, as ofat and for the fiscal year ended May 31, 2019,2022, were prepared in accordance with accounting principles generally accepted in the United States, and the Audit Committee has reviewed and discussed those audited consolidated financial statements with our management of the Company and with KPMG.
Based on the Audit Committee’s discussions with our management of the Company and with KPMG and the Audit Committee’s review of the report of KPMG to the Audit Committee, the Audit Committee unanimously recommended to the Board that the Company’sour audited consolidated financial statements be included (and the Board approved such inclusion) in the Company’s Annual Report on2022 Form 10-K for Fiscal 2019 filed with the SEC on July 30, 2019.August 1, 2022.
The Audit Committee is responsible for authorizing the appointment, compensation, and retention of, and overseeing the work of, our registered public accounting firm. On an annual basis, the Audit Committee evaluates the qualifications, performance and independence of KPMG and determines, after considering the impact of a change in our independent auditor, whether to select KPMG for the coming year. KPMG has been our registered public accounting firm since 2001. KPMG periodically rotates its lead audit engagement partner who cannot hold that position for more than five years, and the Audit Committee takes an active role in the process of evaluating and selecting the new lead audit engagement partner. The Audit Committee believes there are benefits to having a registered public accounting firm with an extensive history with the Company, and that KPMG’s institutional knowledge of us and our business, operations, accounting policies, financial systems and informal control framework leads to efficiencies in its work and to higher quality audit work and accounting advice.
Audit Committee Matters • 2022 Proxy Statement | Worthington | 75 |
The Audit Committee has also selected KPMG as the Company’sour independent registered public accounting firm for Fiscal 20202023 and unanimously recommends that the shareholders ratify such selection.
The foregoing report is provided by the Audit Committee of the Company’s Board:
|
| Audit Committee |
|
|
|
|
| Carl A. Nelson, Jr., Chair |
|
| Kerrii B. Anderson |
|
| Mark C. Davis |
|
| Mary Schiavo |
76 | Worthington | 2022 Proxy Statement • Audit Committee Matters |
|
Pre-Approval of Services Performed by the Independent Registered Public Accounting Firm
Under applicable SEC Rules and PCAOB standards, the charter of the Audit Committee isrequires the Audit Committee to review and pre-approve theall audit and permitted non-audit services performedprovided by the Company’sour independent registered public accounting firm in order to ensure that the performance of these services does not impair the firm’s independence from the Company. The SEC Rules and PCAOB standards specify the types of non-audit services that independent registered public accounting firms may not provide to their audit clients and establish the Audit Committee’s responsibility for administration of the engagement of the Company’s independent registered public accounting firm.
Consistent with applicable SEC Rules and PCAOB standards, the charter of the Audit Committee requires that the Audit Committee review and pre-approve all audit services and permitted non-audit services provided by the independent registered public accounting firm to the Company.us. The Audit Committee may delegate pre-approval authority to one or more designated members of the Audit Committee and, if it does, the decision of that member or members must be reported to the full Audit Committee at its next regularly scheduled meeting. The SEC Rules and PCAOB standards specify the types of non-audit services that independent registered public accounting firms may not provide to their audit clients and establish the Audit Committee’s responsibility for administration of the engagement of our independent registered public accounting firm.
All requests or applications for services to be provided by the Company’sour independent registered public accounting firm must be submitted to the Audit Committee by both the independent registered public accounting firm and the Company’sour CFO and must include a joint statement as to whether, in their view, the request or application is consistent with the SEC Rules and PCAOB standards governing auditor independence.
Independent Registered Public Accounting Firm Fees
Fees billed for services rendered by KPMG for each of Fiscal 20192022 and Fiscal 20182021 were as follows:
Type of Fees |
| Fiscal 2019 |
|
| Fiscal 2018 |
|
|
| Fiscal 2022 |
| Fiscal 2021 | |||||
Audit Fees |
|
| $ | 1,636,000 |
|
|
| $ | 1,435,000 |
|
|
| $1,811,153 |
|
| $1,735,000 |
Audit-Related Fees |
|
|
| — |
|
|
|
| — |
|
|
| 0 |
|
| 0 |
Tax Fees |
|
|
| 95,000 |
|
|
|
| 97,000 |
|
|
| $27,397 |
|
| $73,000 |
Other Fees |
|
|
| 23,000 |
|
|
|
| 84,000 |
|
|
| 0 |
|
| 0 |
Total |
|
| $ | 1,754,000 |
|
|
| $ | 1,616,000 |
|
|
| $1,838,550 |
|
| $1,808,000 |
All of the services rendered by KPMG to the Companyus during Fiscal 20192022 and Fiscal 20182021 were pre-approved by the Audit Committee.
In accordance with applicable SEC Rules, “Audit Fees” are fees for professional services rendered for: the audit of the Company’sour consolidated financial statements; the review of the interim consolidated financial statements included in our Quarterly Reports on Form 10‑Q; the Company’s Forms 10-Q;audit of our internal control over financial reporting; the audit of the Company’s internal control over financial reporting with the objectivestatements of obtaining reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects;certain of our foreign subsidiaries; and services that are normally provided by the independent registered public accounting firm in connection with statutory and regulatory filings or engagements for the applicable fiscal years.
“Tax Fees” are fees for professional services rendered for tax compliance, tax advice and tax planning.
“Other Fees” are fees for consulting services provided for the implementation of the new revenue recognition and lease accounting guidelines.
|
|
Householding of Annualof Annual Meeting Materials
The SEC has implemented rules regarding the delivery of our proxy materials (i.e., notices of annual meeting of shareholders, annual reports, to shareholders, proxy statements and Notices of Internet Availability of Proxy Materials)Availability) to households. This method of delivery, often referred to as “householding”, would permit the Companyus to send: (a) a single annual report to shareholders and/or a single proxy statement, or (b) a single Notice of Internet Availability of Proxy Materials to any household at which two or more registered shareholders reside if the Companywe reasonably believesbelieve such shareholders are members of the same family or otherwise share the same address or that one shareholder has multiple accounts. In each case, the registered shareholder(s) must consent to the householding process in accordance with applicable SEC Rules. The householding procedure reduces the volume of duplicate information shareholders receive and reduces the Company’sour expenses. The CompanyWe may institute householding in the future and will notify registered shareholders affected by householding at that time. Registered shareholders sharing an address may request delivery of a single copy of annual reports to shareholders,our proxy statements and Notices of Internet Availability of Proxy Materials, as applicable,materials by contacting theour Investor Relations Department of the Company at Worthington Industries, Inc., 200 Old Wilson Bridge Road, Columbus, Ohio 43085, Attention: Marcus Rogier, Director, Investor Relations.
Many broker/dealersbrokers, banks and other holders of record considered to be the registered shareholder with respect to the common shares for beneficial owners have instituted householding. If your family or others with a shared address have one or more “street name” accounts under which you beneficially own the common shares, of the Company, you may have received householding information from your broker/dealer, financial institutionbroker, bank or other nomineeholder of record in the past. Please contact theyour broker, bank or other holder of record directly if you have questions, require additional copies of this Proxy Statement, the Company’s 2019our 2022 Annual Report to Shareholders or the Notice of Internet Availability of Proxy Materials and/or wish to revoke your decision to household and thereby receive multiple copies. You should also contact theyour broker, bank or other holder of record if you wish to institute householding.
78 | Worthington | 2022 Proxy Statement • Householding of Annual Meeting Materials |
|
Shareholder Proposals for 2020for 2023 Annual Meeting
Shareholders of the Company seeking to bring business before an annual meeting of shareholders (an “annual meeting”) or to nominate candidates for election as directors at an annual meeting must provide timely notice thereof in writing to the Company’sour Secretary. Under Section 1.08(A) of the Company’sour Code of Regulations, to be timely, a shareholder’s notice with respect to business to be brought before an annual meeting must be delivered to, or mailed and received at, theour principal executive offices of the Company not less than 30 days prior to an annual meeting. However, if less than 40 days’ notice or prior public disclosure of the date of the meeting is given or made to shareholders, the shareholder’s notice must be received no later than the close of business on the tenth day following the day on which such notice of the date of the meeting was mailed or such public disclosure was made. In order for a shareholder’s notice to be in proper form, it must include: (a) a brief description of the business the shareholder desires to bring before an annual meeting; (b) the reasons for conducting the proposed business at an annual meeting; (c) the name and address of the proposing shareholder; (d) the number of common shares beneficially owned by the proposing shareholder; and (e) any material interest of the proposing shareholder in the business to be brought before an annual meeting. The requirements applicable to nominations are described above in “CORPORATE GOVERNANCE“Corporate Governance – Nominating Procedures” beginning on page 15 ofin this Proxy Statement.
A shareholder seeking to bring business before an annual meeting must also comply with all applicable SEC Rules. Under SEC Rule 14a-8, proposals of shareholders intended to be presented at the Company’s 2020our 2023 Annual Meeting of shareholders must be received by the Companyus no later than April 16, 2020,17, 2023, to be eligible for inclusion in the Company’sour proxy materials relating to the 20202023 Annual Meeting. Upon receipt of a shareholder proposal, the Companywe will determine whether or not to include the proposal in the proxy materials in accordance with applicable SEC Rules.
The SEC has promulgated rules relating to the exercise of discretionary voting authority pursuant to proxies solicited by the Board. Generally, a proxy may confer discretionary authority to vote on any matters brought before an annual meeting if the Companywe did not have notice of the matter at least 45 days before the date on which the Companywe first sent itsour proxy materials for the prior year’s annual meeting and a specific statement to that effect is made in the proxy statement or form of proxy. If during the prior year, the Company did not hold an annual meeting, or if the date of the annual meeting has changed more than 30 days from the prior year, then notice must not have been received a reasonable time before the Company mails its proxy materials for the current year. Any written notice required as described in this paragraph must have been given by June 30, 2019,July 2, 2022, for matters to be brought before the 20192022 Annual Meeting. Any written notice required as described in this paragraph must be given by June 30, 2020July 1, 2023, for matters to be brought before the 20202023 Annual Meeting.
Any written notice to be given with respect to matters set forth in the three prior paragraphs of this “SHAREHOLDER PROPOSALS FOR 2020 ANNUAL MEETING”“Shareholder Proposals for 2023 Annual Meeting” section must be sent to the Company’sour Secretary Dale T. Brinkman,at Worthington Industries, Inc., 200 Old Wilson Bridge Road, Columbus, Ohio 43085 or by fax to (614) 840-3706.
The Company’s 2020 Annual MeetingOur 2023 annual meeting of Shareholdersshareholders is currently scheduled to be held on September 23, 2020.27, 2023.
|
| 79 |
Future Electronic Access to Proxyto Proxy Materials and Annual Report
Registered shareholders can further reduce the costs incurred by the Companyus by consenting to receive all future proxy statements, proxy cards, annual reports to shareholders and Notices of Internet Availability, of Proxy Materials, as appropriate, electronically via e-mail or the Internet. To sign up for electronic delivery of future proxy materials, you must vote your common shares electronically via the Internet by logging on to www.proxyvote.com and, when prompted, indicate that you agree to receive or access shareholder communications electronically in future years. You will be responsible for any fees or charges that you would typically pay for access to the Internet.
AuditedOur audited consolidated financial statements for Worthington Industries, Inc. and its subsidiaries for Fiscal 20192022 are included in the Company’s 20192022 Annual Report to Shareholders.Report. Additional copies of these financial statements and the Company’s 2019our 2022 Form 10-K (excluding exhibits) may be obtained, without charge, by sending a written request to the Company’sour Investor Relations Department at 200 Old Wilson Bridge Road, Columbus, Ohio 43085, Attention: Marcus Rogier, Director, Investor Relations. The Company’s 20192022 Form 10-K is also available on the Company’sour website located at www.worthingtonindustries.com and can also be found on the SEC website located at www.sec.gov.
This Proxy Statement includes several website addresses. These website addresses are intended to provide inactive, textual references only. The information on the websites referenced herein is not part of this Proxy Statement.
As of the date of this Proxy Statement, the Board knows of no business that will be presented for action by the shareholders at the Annual Meeting other than those matters discussed in this Proxy Statement. However, if any other matter requiring a vote of the shareholders properly comes before the Annual Meeting, or if a director nominee named in this Proxy Statement is unable to serve or will not serve, the individuals acting under the proxies solicited by the Board will vote and act according to their best judgment in light of the conditions then prevailing, to the extent permitted under applicable law.
|
| By Order of the Board of Directors, |
|
| |
Dated: August |
|
|
Patrick J. Kennedy, | ||
|
| Secretary |
| Worthington | 2022 Proxy Statement |
|
3M
A.O. Smith
Abbott LaboratoriesAaron's
AbbVieABB (Asea Brown Boveri)
AbiomedABC Technologies
Accenture
ACHACI Worldwide
Acronis
Adecco
Adient
ADM - Archer Daniels Midland
ADT
Adtalem Global Education
ADTRAN
Advanced Drainage Systems
Advanced Transit Manufacturing
AECOM
Aegion
Aerojet Rocketdyne
AGCO
Agilent Technologies
Agrium
AgroFresh Solutions
Air LiquideAimia
Air Products and Chemicals
Airbus Group (EADS)
Alaska Air Group
Albertsons
Alcoa
Alexander & BaldwinAlgas-SDI
Alexion PharmaceuticalsAllegheny Technologies
Altice USAAllegion
Allied Electronics
Allnex
Altria Group
Amazon.comAltus Group
Amadeus North America
American Airlines
American Dehydrated Foods
American Greetings
American Sugar Refining
Americas Styrenics
AmeriCold Logistics
AmeriHealth Caritas
AmerisourceBergen
AMETEK
Amgen
AMSTED Industries
AmtrakAmway
AmwayAndersen
Andersons
Anheuser-BuschApache
Apex Tool GroupApple
Arby's Restaurant GroupApplied Research Associates
Archer Daniels MidlandAramark
Arconic
ArkemaAriens Company
Armstrong FlooringArkema
Armstrong World Industries
Arrow Electronics
Arup USAAsahi Kasei
Asbury Automotive Group
Ascena Retail
Ashland
AstraZeneca
AT&T
AtriCure
Automatic Data Processing
AvalonBay Communities
Avanade
Avery Dennison
Avis Budget GroupAvient Corporation
Avnet
Axalta Coating Systems
Bain & Company
Baker Hughes
Ball
Barrick Gold of North America
Baxter
Bechtel Nuclear, Security & Environmental
Becton Dickinson
Bemis Manufacturing Company
Berry Global
Best Buy
BIC Group
Big Lots
Blount InternationalBiogen
Biotronik
BJ's Restaurants
BJ's Wholesale Club
Black & Veatch
Bloomin Brands
BMC Software
Boeing
Bombardier Transportation
Booz Allen Hamilton
BorgWarner
Bose
Boston Scientific
Bountiful Company
Bradley
Brady
Brembo
Bridgestone AmericasBright Horizons
Brink's
Bristol-Myers SquibbBroadridge Financial Solutions
BungeBrunswick
Burlington Northern Santa Fe
Bush Brothers & Company
CABuzzi Unicem USA
BWX Technologies
C&S Wholesale Grocers
Cabot
Calgon CarbonCAE
Campbell Soup
Canadian Pacific Railway
Cardinal Health
Cargill
Carlson RezidorCarmeuse North America Group
Carnival
Carpenter Technology
Carrier Global Corporation
Catalent Pharma Solutions
CDI
CDK Global
CDM Smith
CDW
Cedar Fair
Celanese
Celestica
Celgene
CenturyLinkCentral Plateau Cleanup Company
CF Industries
CGI Technologies and Solutions
CH2M HILLChamberlain Group
Charter Communications
Chemours CompanyCherokee Nation Businesses
ChemturaChesapeake Energy
Chicago Bridge & Iron (CB&I)Chevron
Chevron Phillips Chemical
Chewy.com
Chickasaw Nation
Choice Hotels International
CHS
Chumash Casino Resort
Church & Dwight
Cimpress
Cincinnati Bell
Cliffs Natural ResourcesCitrix Systems
CloroxCLEAResult
Coca-ColaClearwater Paper Corporation
Coca-Cola RefreshmentsCoesia
Colgate-Palmolive
Colliers International
Colsa
Columbia Sportswear
Comcast Cable Corporation
Commercial Metals
CommScope
CompassCommunity Coffee
Computacenter
Computacenter Fusionstorm Inc.
Computershare
ConAgra FoodsBrands
ConduentConcentrix
ConocoPhillips
Constellation Brands
Continental Automotive Systems
ConvergysContinental Carbon
Cooper Standard Automotive
CooperVision
CoorsTek
Corning
Corteva Agriscience
Covestro
Cox Media Group
CPA Global Management Services
Crowley Maritime Corporation
Crown Castle
CSC ServiceWorks
CSX
CTB Inc
CTCI
Cubic Corporation
Curtiss-Wright
Cushman & Wakefield
CVR Energy
CVS Health
Dairy Farmers of America
Dana
Danone North America
Darden Restaurants
Day & ZimmermannDatasite
Dean FoodsDaVita Inc.
Delta Air LinesDCP Midstream
Deluxe
Dematic Group
DENSO International
Dentsply Sirona
DHL Supply Chain
Diageo North America
Dick's Sporting Goods
Diebold Nixdorf
Domino's Pizza
Domtar
Donaldson
Dorman Products
Dot Foods
Dover
Dow Chemical
Dr Pepper Snapple GroupDriscoll's
DuPont
E & J Gallo WineryE.A. Sween Company
E.W. Scripps
EAB Global
Eastman Chemical
Eastman KodakEating Recovery Center
Ecolab
Edgewell Personal Care
Edwards Lifesciences
Electrolux
Element Fleet ManagementElementis
Eli Lilly
Emergent BioSolutionsEMCOR Group
Encana Services CompanyEnable Midstream Partners
Encompass Health Corporation
Endo
Enova InternationalEnergy Transfer Partners
EnPro Industries
Environmental Chemical Corp
Epson America
Equifax
Equity Office PropertiesEricsson
ESCOErnst & Young
Estée Lauder
EsterlineEveris
Evoqua Water Technologies
Exide Technologies
EXL Service
Expedia
Experian Americas
Express ScriptsExxonMobil
Faurecia US HoldingsFedEx Express
Ferrara Candy Company
Fiat Chrysler Automobiles (FCA)
FinastraFindley Davies
First Solar
FirstGroup America
FIS
Fiserv
Flowers FoodsFlex
Flowserve
Fluor
Fluor Federal Petroleum Operations
Follett Corporation
Ford
Forsythe TechnologyFortive Corporation
Fortune Brands Home & Security
Foundation Medicine
Freeman
Freeport-McMoRan
Fresenius Medical Care NAFreudenberg
Frontier Communications
FTD CompaniesFugro
Funding Circle
GAF Materials
Gannett
Gap
Garmin
GCP Applied TechnologiesGates
General Atomics
General Dynamics
General ElectricDynamics Information Technology
General Mills
General Motors
GenusGenesis Energy
Gilead SciencesGeorgia-Pacific
GL&VGerson Lehrman Group
Getinge
Glanbia Group Services
GlaxoSmithKlineGlatfelter
Global Payments
GLOBALFOUNDRIES
Glory Global Solutions
GOJO Industries
Goodyear Tire & Rubber
Graco
Graphic PackagingGrafTech International
Greene, Tweed and Co.
H.B. Fuller
Hallmark Cards
Halozyme Therapeutics
Halyard Health
Hanesbrands
Harland Clarke
Harman International Industries
Harris
Harsco
HD Supply
Healthcare Services Group
Henry Schein
Herc Rentals
Herman Miller
Hershey
Hexcel
Hexion
Hilton Grand Vacations
Hilton Worldwide
Hitachi Data Systems
HNI
HNTB
Hoffmann-La Roche
Hormel Foods
Host Hotels & Resorts
Houghton Mifflin Harcourt Publishing
HTC
Hunt Consolidated
Husky Injection Molding Systems
IBM
IDEX Corporation
IDEXX Laboratories
iHeartMedia
IMS Health
INEOS Olefins & Polymers USA
Ingenico
Ingersoll Rand
Ingevity
Intercontinental Hotels Group
International Flavors & Fragrances
International Game Technology
International Paper
ION Geophysical
Iron Mountain
Irvine
Itron
ITT Inc.
J. Crew
J.M. Smucker
Jabil Circuit
Jacobs Engineering
JetBlue Airways
John Wiley & Sons
Johns Manville
Johnson & Johnson
Johnson Controls
K. Hovnanian Companies
Kantar Group
Kapsch Partner Solutions
KBR
Kellogg
Kelly Services
Kennametal
Kerry Group
Keurig Green Mountain
Keystone Foods
Kimberly-Clark
Kinross Gold
Koch Industries
Kohler
Kraft Heinz
Kroger
Kum & Go LC
L-3 Communications
Grande Cheese
Appendix I • | I-1 |
Lafarge NorthGraphic Packaging
Greif
GROWMARK
Grupo Cementos de Chihuahua
Guardian Industries
Guardian News & Media
Guidehouse
Gympass
H&R Block
H.B. Fuller
HarbisonWalker International
Harley-Davidson
Harman International Industries
Harsco
Hasbro
HAVI Group
HCA Healthcare
HDR
Hendrickson
Henry Schein
Herman Miller
Hertz
Hess
Hexcel
Hexion
High Company
Hillenbrand
Hilton Grand Vacations
Hilton Worldwide
Hirose Electric
Hitachi Solutions America
Hitachi Vantara
HNI
HNTB
Honeywell
Hormel Foods
Host Hotels & Resorts
Houghton Mifflin Harcourt Publishing
Humana
Hunt Consolidated
IBM
IDEX Corporation
IDEXX Laboratories
iHeartMedia
Illinois Tool Works
Infirmary Health System
Ingenico
Ingevity
Ingram Industries
Ingram Micro
Inmar Inc
Innophos
Innospec
Insperity
Integer Holdings
Integra Lifesciences
International Data Group
International Flavors & Fragrances
International Game Technology
International Paper
Intertape Polymer Corp
IQVIA
ITT Inc.
Ixom
J.M. Smucker
Jabil Circuit
Jack in the Box
Jackson Dawson Communications
Jacobs Engineering
Jacobs Technology
Jefferson Science Associates
Jensen Precast
JetBlue Airways
Johns Manville
Johnson Controls
K. Hovnanian Companies
Kantar Group
Kapsch Partner Solutions
KAR Global
Kelsey-Seybold Clinic
Kennametal
Kent Corporation
Kerry Group
Keurig Dr Pepper
KI, Inc
Kimley-Horn and Associates
Kindred Healthcare
Kinross Gold
Koch Engineered Solutions
Koch Industries
Kodak Alaris
Kohler
Kongsberg Automotive
Koppers
KPMG
Kronos Worldwide
Kubota Tractor Corporation
Kyocera International
L.L. Bean
L3Harris
Lam Research
Land O'Lakes
Lear
Learning Care Group
Ledcor Group of Companies
LEDVANCEIndustries
Leggett and Platt
Lehigh Hanson
Lehigh University
Leidos
Lend Lease
LenovoLetgo
Leprino FoodsLeupold & Stevens
LexisNexisLevi Strauss
LG ElectronicsLexmark
Lhoist
Liberty Global
Life Time Fitness
Lincoln Electric
Liquidpower Specialty Products
Lockheed Martin
Logicalis
L'Oréal
Lowe's
LSC Communications
Lubrizol
Luck Companies
Lumen
Lutron Electronics
LydallLyondellBasell
LyondellBasellMagellan Health Services
Magellan Midstream Partners
MakinoMalco Products
Marathon Oil
Marathon Petroleum
Marriott International
Mars Incorporated
Martin Marietta Materials
Mary Kay
Mary Washington HealthCare
Masco
MasterCard
Materion Corporation
Matrix Service
Mattel
Matthews International
McCormickMauser Packaging Solutions
Maximus
McDermott International
McDonald's
McLane Company
Medicines CompanyMedline Industries
Medtronic
Merck & CoMeredith
Meritor
Micron TechnologyMGM Resorts International
Microsoft
MillicomMitsubishi International Cellular
Mission ProduceMolson Coors Beverage Company
MolexMomentive Performance Materials
Mondelez
MonsantoMoneyGram
MORSCO
Mosaic
Motorola Solutions
MRC Global
MSA Safety
MTD Products
MTS Systems
MylanMVF
Navigant ConsultingMyers Industries
NBTYNavistar International
NCC
NCR
Nestle USA
New York Times
Newegg.com
Newell Rubbermaid
Newmont Mining
News Corporation
Nexteer Automotive
Niagara Bottling
NIBCO Inc
Nike
Nissan North AmericaMotor
NokiaNNV Ventures
Nordson CorporationNoble Energy
Norfolk Southern
Northrop Grumman
Northwest Permanente PC
Northwest Pipe Company
NovartisNOVA Chemicals
Novelis
NOW Foods
Nu Skin Enterprises
Nubank
Nutrien
Occidental Petroleum
Orbital ATKOLX
OshkoshON Semiconductor
Osram SylvaniaONEOK
Options Clearing Corporation
Otis Elevator Company
Outfront Media
Owens Corning
Owens-Illinois
Panasonic of North America
Paramount Global
PAREXEL
Parker Hannifin
Parmalat
Parsons Corporation
Paychex
PBF Energy
Peabody Energy
PepsiCoPeraton
PfizerPerdoceo Education Corporation
PharmavitePerformance Food Group
Petco
Philips Healthcare
Pitney BowesPhillips 66
Pilot Flying J
PKC Group
Plexus
Polar BeveragesPluralsight
Polaris Industries
PolyOne
PotashPPC Partners
Praxair
Precision DrillingCastparts
Preformed Lined Products
PrimeSource Building Products
Promat
PulteGroup
Purdue Pharma
Quad/GraphicsQTC Management
QTI Human Resources
Quad
Quest Diagnostics
QuintilesRackspace Technology
RackspaceRadisson Hotels
Rank GroupRaising Cane's Chicken Fingers
Rayonier Advanced Materials
Redbox Automated RetailRaytheon Technologies
Refinitiv
Regency Centers
Regeneron PharmaceuticalsReiter Affiliated Companies
Repay Holdings
Resideo
Rev Group
RevlonRevantage Corporate Services
Reynolds American
Rheem Manufacturing
RiceTec
Rich Products
Ricoh Americas
Riot GamesRivian Automotive
Rockwell AutomationRobroy Industries
Rockwell Collins
Rowan CompaniesRolls-Royce North America
Royal Caribbean Cruises
RPM InternationalRSM US LLP
Rutgers University
Ryder System
Ryerson
S&C Electric
S&P Global
S.C. Johnson & Son
Sabre Corporation
SAIC
Samsung
SanofiSamuel, Son & Co. Limited
Sargento Foods
SAS Institute
Sasol USASaudi Aramco
Schmolz + Bickenbach
Schneider ElectricSchlumberger
Scholastic
Schreiber Foods
Schwan Food Company
Schweitzer-Mauduit International
Scientific Research Corporation
Scotts Miracle-Gro
Scoular Company
Scripps Networks Interactive
Sealed Air
Sensient Technologies
Serta Simmons BeddingSerco Group
ServiceSourceSES
SGS - Société Générale de SurveillanceShell Oil
Sherwin-Williams
SiemensSICPA
Simmons FoodsSiegwerk Druckfarben
Sierra Nevada Corporation
Signant Health
Smithfield Foods
SMSC Gaming Enterprise
Snap-on
SNC-LavalinSnow Software
Sodexo
Sonepar USA
Sonic Corp
Sonoco Products
Sony
Sony Electronics
Southwest AirlinesSoutheastern Freight Lines
Southern Glazer's Wine and Spirits
SpartanNash
Spectrum Brands
Spirit AeroSystems
Spirit Airlines
Sprint
SPX Corporation
SPX FLOW
SSAB
Standex International
Stantec
StarzStar Tribune
Stars Group (The)
Steelcase
Steris
Stolt-Nielsen
Stryker
SunCoke EnergySubaru of America
SyncreonSumitomo Corporation of Americas
Syngenta Crop ProtectionSummit Midstream
Sunbelt Rentals
SWIFT
Swiss Steel
Sysco Corporation
Takeda Pharmaceuticals
Target
Taubman Centers
TE Connectivity
TeleTech
Tempur Sealy
Teradata
Terex
Textron
Thermo Fisher Scientific
Thyssenkrupp
Tiffany & Co.
Time Warner
Timken
TimkenSteel
T-Mobile USA
Toro
Total Petrochemicals USA
Total System Service (TSYS)
Transocean
TransUnion
Tribune Media
Trimble Inc.
Trinity Industries
Tupperware Brands
Tyson Foods
Underwriters Laboratories
Unilever United States
Union Pacific Corporation
Unisys
United Continental Holdings
United States Cellular
United States Steel
United Technologies Corporation (UTC)
UPS
Valero Energy
Valvoline
Vectrus
Ventura Foods
Veolia Environmental Services North America
VeriSign
Verizon
Vertex Pharmaceuticals
Viacom
Viad
Vista Outdoor
Vulcan Materials
VWR International
W.R. Grace
W.W. Grainger
WageWorks
Walt Disney
Waste Management
Watts Water Technologies
Wendy's Group
West Pharmaceutical Services
Westlake Chemical
WestRock
Weyerhaeuser
Whirlpool
Wilsonart
Worthington Industries
Wyndham Worldwide
Yazaki
YP
Zebra Technologies
Zimmer Bonne
I-2 | Worthington | |
TaylorMade Golf
TD Synnex
TDS Telecom
TE Connectivity
TEGNA
Telefónica
Tenet Healthcare Corporation
Tennant Company
Teradata
Terex
Terumo BCT
Textron
The Christ Hospital
Thermo Fisher Scientific
Thomson Reuters
Thyssenkrupp
Tiffany & Co.
Timken
TimkenSteel
Tivity Health
T-Mobile USA
TomTom
Trane Technologies
Transocean
TransUnion
Trinity Consultants
Trinity Industries
Trinseo
TTEC
Tupperware Brands
Tyson Foods
U.S. Xpress Enterprises
Uline
Under Armour
Underwriters Laboratories
Unilever United States
Unisys
United Launch Alliance
United Natural Foods, Inc.
United Rentals
United States Cellular
United States Steel
University of Missouri System
University of Phoenix
UPS
US Radiology Specialists
Valero Energy
Valvoline
Vectrus
Ventech Solutions
Vericast
Verisk Analytics
Verizon
Verra Mobility
Vertiv
Vesuvius - Advanced Refractories
VF Corporation
Viatris
Vista Outdoor
Visteon
Volkswagen Group of America
Vulcan Materials
W.R. Grace
Wabtec
Wake Forest University
Walt Disney
Warner Music Group
WarnerMedia Group
Waste Management
Waters
Wawa
Wayne Farms
Weir ESCO
Wells Enterprises
West Pharmaceutical Services
Western Digital
Westlake Chemical
WestRock
Weyerhaeuser
Whataburger Restaurants
Whirlpool
White & Case
Wichita State University
Wilmer Cutler Pickering Hale and Dorr LLP
Winnebago Industries
Winpak Portion Packaging
Wood
XPO Logistics
Xtek Inc
Xylem
Yanfeng Global Automotive Interior Systems
Yazaki Corporation
Zayo Group
Zebra Technologies
Zimmer Biomet
Zurn Water Solutions
AMENDED AND RESTATED
1997 LONG-TERM INCENTIVE PLAN
(Fourth Amendment)
This Fourth Amendment (this “Fourth Amendment”) to the Worthington Industries, Inc. Amended and Restated 1997 Long-Term Incentive Plan (as previously amended, the “Plan”) is adopted as of June 26, 2019, subject to shareholder approval.
WHEREAS, pursuant to Section 12 of the Plan, the Board of Directors (the “Board”) of Worthington Industries, Inc. (the “Company”) may amend the Plan, with the approval of the shareholders of the Company, in order to increase the total number of common shares reserved for the purpose of the Plan; and
WHEREAS, the Board desires to amend the Plan to increase the total number of common shares reserved for the purpose of the Plan and to make other administrative changes to reflect current Company practices;
NOW, THEREFORE, the Board hereby amends the Plan, subject to and effective upon approval by the shareholders of the Company, as follows:
|
|
The maximum number of Shares in respect of which Awards may be granted under the Plan, subject to adjustment as provided in Section 3(c) of the Plan, shall be 8,000,000. Notwithstanding the foregoing, no Participant may be granted Awards in any one calendar year with respect to more than 200,000 Shares. No Awards of Incentive Stock Options may be made after 2007.
For the purpose of computing the total number of Shares available for Awards under the Plan, there shall be counted against the foregoing limitations the number of Shares subject to issuance upon exercise or settlement of Awards as of the dates on which such Awards are granted. Shares which were previously subject to Awards shall again be available for Awards under the Plan if any such Awards are forfeited, terminated, expire unexercised, settled in cash or property other than Shares or exchanged for other Awards including any withholding of Shares to pay taxes (to the extent of such forfeiture, termination, withholding or expiration of such Awards), or if the Shares subject thereto can otherwise no longer be issued. Any Shares which are used as full or partial payment to Worthington by a Participant of the option price of Shares upon exercise of an Option shall again be available for Awards under the Plan; provided, however, that any Shares which are the subject of Options or of Stock Appreciation Rights granted on or after September 26, 2013, shall not again be available for Awards under the Plan, even if such Option or Stock Appreciation Right is forfeited, terminated, expires unexercised, settled in cash or property other than Shares or exchanged for another Award or the Shares subject to such Option or Stock Appreciation Right can otherwise no longer be issued.
IN WITNESS WHEREOF, the Company has caused this Fourth Amendment to the Plan to be executed by the Company’s duly authorized officer on June 26, 2019.
| |
|
|
|
|
|
|
Appendix |
|
AMENDED AND RESTATED
1997 LONG-TERM INCENTIVE PLAN
(reflects First Amendment, Second Amendment
and Third Amendment thereto)
SECTION 1. PURPOSE. The purposes of the Worthington Industries, Inc. Amended and Restated 1997 Long-Term Incentive Plan (the “Plan”) are to encourage selected key employees of the Company to acquire a proprietary and vested interest in the growth and performance of the Company, to generate an increased incentive to contribute to the Company’s future success and prosperity, thus enhancing the value of the Company for the benefit of shareholders, and to enhance the ability of the Company to attract and retain individuals of exceptional talent upon whom, in large measure, the sustained progress, growth and profitability of the Company depends. This Plan became effective on the Effective Date and is being amended and restated effective as of November 1, 2008 for purposes of Section 409A of the Code.
SECTION 2. ADMINISTRATION. The Plan shall be administered by the Committee. The Committee shall have full power and authority, subject to such orders or resolutions not inconsistent with the provisions of the Plan as may from time to time be adopted by the Board, to: (i) select the Employees of the Company to whom Awards may from time to time be granted hereunder; (ii) determine the type or types of Award to be granted to each Participant hereunder; (iii) determine the number of Shares to be covered by each Award granted hereunder; (iv) determine the terms and conditions, not inconsistent with the provisions of the Plan, of any Award granted hereunder; (v) determine whether, to what extent and under what circumstances Awards may be settled in cash, Shares or other property or canceled or suspended; (vi) interpret and administer the Plan and any instrument or agreement entered into under the Plan; (vii) establish such rules and regulations and appoint such agents as it shall deem appropriate for the proper administration of the Plan; and (viii) make any other determination and take any other action that the Committee deems necessary or desirable for administration of the Plan. Decisions of the Committee shall be final, conclusive and binding upon all Persons, including the Company, any Participant, any shareholder, and any Employee of the Company. A majority of the members of the Committee may determine its actions and fix the time and place of its meetings.
SECTION 3. DURATION OF, AND SHARES SUBJECT TO PLAN.
(a) Term. The Plan shall remain in effect until terminated by the Board, provided, however, that no Incentive Stock Option may be granted after more than 10 years after the Effective Date.
(b) Shares Subject to the Plan. The maximum number of Shares in respect of which Awards may be granted under the Plan, subject to adjustment as provided in Section 3(c) of the Plan, shall be 6,500,000. Notwithstanding the foregoing, in no event shall more than 1,000,000 Shares be cumulatively available for Awards of Incentive Stock Options under the Plan and provided further that no Participant may be granted Awards in any one calendar year with respect to more than 200,000 Shares. [NOTE: This paragraph Section 3(b) was amended pursuant to the Second Amendment to the Plan effective as of September 26, 2013.]
For the purpose of computing the total number of Shares available for Awards under the Plan, there shall be counted against the foregoing limitations the number of Shares subject to issuance upon exercise or settlement of Awards as of the dates on which such Awards are granted. Subject to the following sentence, (a) any Shares which are used as full or partial payment to Worthington by a Participant of the option price of Shares upon exercise of an Option shall again be available for Awards under the Plan; and (b) Shares which were previously subject to Awards shall again be available for Awards under the Plan if any such Awards are forfeited, terminated, expire unexercised, settled in cash or property other than Shares or exchanged for other Awards (to the extent of such forfeiture, termination or expiration of such Awards), or if the Shares subject thereto can otherwise no longer be issued. The above notwithstanding, any Shares which are the subject of Options or of Stock Appreciation Rights granted on or after September 26, 2013, shall not again be available for Awards under the Plan, even if such Option or Stock Appreciation Right is forfeited, terminated, expires unexercised, settled in cash or property other than Shares or exchanged for another Award or the Shares subject to such Option or Stock Appreciation Right can otherwise no longer be issued. [NOTE: This paragraph of Section 3(b) was amended pursuant to the Second Amendment to the Plan effective as of September 26, 2013.]
Shares which may be issued under the Plan may be either authorized and unissued Shares or issued Shares which have been reacquired by Worthington. No fractional Shares shall be issued under the Plan.
|
|
(c) Changes in Shares. In the event of any merger, reorganization, consolidation, recapitalization, stock dividend, stock split, reverse stock split, spin off, exchange of shares or similar transaction or other change in corporate structure or capitalization affecting the Shares or the price thereof, such adjustments and other substitutions shall be made to the Plan and to Awards as the Committee in its sole discretion deems equitable or appropriate, including without limitation such adjustments in the aggregate number, class and kind of Shares which may be delivered under the Plan, in the aggregate or to any one Participant, in the number, class, kind and option or exercise price of Shares subject to outstanding Options, Stock Appreciation Rights or other Awards granted under the Plan, and in the number, class and kind of Shares subject to Awards granted under the Plan (including, if the Committee deems appropriate, the substitution of similar options to purchase the shares of, or other awards denominated in the shares of, another company) as the Committee may determine to be appropriate in its sole discretion, provided that the number of Shares or other securities subject to any Award shall always be a whole number. Any adjustment made pursuant to this Section 3(c) shall be made consistent with the requirements of Section 409A of the Code, to the extent applicable.
(d) Prohibition on Repricing. Except for adjustments made pursuant to Section 3(c) of the Plan, in no event may the Committee, without obtaining shareholder approval: (i) amend the terms of an outstanding Award to reduce the option price of an outstanding Option or the grant price of an outstanding Stock Appreciation Right; (ii) cancel an outstanding Option or Stock Appreciation Right in exchange for Options or Stock Appreciation Rights with an option price or grant price, as applicable, that is less than the option price or grant price of the original Option or Stock Appreciation Right; (iii) cancel an outstanding Option or Stock Appreciation Right with an option price or grant price, as applicable, which is above the current Fair Market Value of the Shares underlying the Option or Stock Appreciation Right in exchange for another Award, cash or other securities; (iv) take any other action that is treated as a “repricing” under generally accepted accounting principles; or (v) take any other action that has the effect of “repricing” an Award, as defined under the rules of the securities exchange or other recognized market or quotation system on which the Shares are then listed or traded. [NOTE: This Section 3(d) was amended pursuant to the Second Amendment to the Plan effective as of September 26, 2013.]
SECTION 4. ELIGIBILITY. Any Employee (excluding any member of the Committee) shall be eligible to be selected as a Participant.
SECTION 5. OPTIONS. Options may be granted hereunder to Participants, either alone or in addition to other Awards granted under the Plan. Any Option granted under the Plan shall be evidenced by an Award Agreement in such form as the Committee may from time to time approve. Any such Option shall be subject to the following terms and conditions and to such additional terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall deem desirable. The provisions of Options need not be the same with respect to each Participant.
(a) Option Price. The option price per Share purchasable upon exercise of an Option shall be determined by the Committee in its sole discretion; provided that such option price shall not be less than the Fair Market Value of the Share on the date of the grant of the Option.
(b) Option Period. The term of each Option shall be fixed by the Committee in its sole discretion; provided that no Incentive Stock Option shall be exercisable after the expiration of ten years from the date the Incentive Stock Option is granted.
(c) Exercisability. Options shall be exercisable at such time or times as determined by the Committee at or subsequent to grant. Unless otherwise determined by the Committee at or subsequent to grant, no Incentive Stock Option shall be exercisable during the year ending on the day before the first anniversary date of the granting of the Incentive Stock Option.
(d) Method of Exercise. Subject to the other provisions of the Plan and any applicable Award Agreement, any Option may be exercised by the Participant in whole or in part at such time or times, and the Participant may make payment of the option price in such form or forms, including, without limitation, payment by delivery of cash, Shares already owned by the Participant or other consideration (including, where permitted by law, by delivery or surrender of outstanding vested and exercisable Awards, including through the withholding of Shares which would otherwise be issued in connection with the exercise of a vested and exercisable Option, having a Fair Market Value on the exercise date equal to the total option price, or by any combination of cash, Shares and other consideration unless the Committee may otherwise specify in the applicable Award Agreement.
|
|
(e) Incentive Stock Options. In accordance with rules and procedures established by the Committee, the aggregate Fair Market Value (determined as of the time of grant) of the Shares with respect to which Incentive Stock Options held by any Participant which are exercisable for the first time by such Participant during any calendar year under the Plan (and under any other benefit plans of the Company or of any parent or subsidiary corporation of the Company) shall not exceed $100,000 or, if different, the maximum limitation in effect at the time of grant under Section 422 of the Code, or any successor provision, and any Treasury Regulations promulgated thereunder. The terms of any Incentive Stock Option granted hereunder shall comply in all respects with the provisions of Section 422 of the Code, or any successor provision, and any Treasury Regulations promulgated thereunder.
SECTION 6. STOCK APPRECIATION RIGHTS. Stock Appreciation Rights may be granted hereunder to Participants, either alone or in addition to other Awards granted under the Plan, and may, but need not, relate to a specific Option granted under Section 5. The provisions of Stock Appreciation Rights need not be the same with respect to each Participant. Any Stock Appreciation Right related to a Nonstatutory Stock Option may be granted at any time thereafter before exercise, termination or expiration of such Nonstatutory Stock Option. Any Stock Appreciation Right related to an Incentive Stock Option must be granted at the same time such Incentive Stock Option is granted. In the case of any Stock Appreciation Right related to any Option, the Stock Appreciation Right or applicable portion thereof shall terminate and no longer be exercisable upon the termination or exercise of the related Option, except that a Stock Appreciation Right granted with respect to less than the full number of Shares covered by a related Option shall not be reduced until the number of Shares subject to the exercise or termination of the related Option exceeds the number of Shares not covered by the Stock Appreciation Right. Any Option related to any Stock Appreciation Right shall no longer be exercisable to the extent the related Stock Appreciation Right has been exercised. The Committee may impose such conditions or restrictions on the exercise of any Stock Appreciation Right as it shall deem appropriate.
SECTION 7. RESTRICTED STOCK.
(a) Issuance. Restricted Stock Awards may be issued hereunder to Participants, either alone or in addition to other Awards granted under the Plan, for such consideration as determined by the Committee in its sole discretion and the Committee may issue such Awards for no consideration or for such minimum consideration as may be required by applicable law. Restricted Stock Awards shall contain such limitations, terms and conditions and other provisions as determined by the Committee in its sole discretion. The provisions of Restricted Stock Awards need not be the same with respect to each Participant.
(b) Registration. Any Restricted Stock issued hereunder may be evidenced in such manner as the Committee in its sole discretion shall deem appropriate, including, without limitation, book-entry registration or issuance of a stock certificate or certificates. In the event any stock certificate is issued in respect of shares of Restricted Stock awarded under the Plan, such certificate shall be registered in the name of the Participant, and shall bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such Award.
(c) Forfeiture. Except as otherwise determined by the Committee at the time of grant, upon termination of employment for any reason during the restriction period, all shares of Restricted Stock still subject to restriction shall be forfeited by the Participant and reacquired by Worthington, for the purchase price paid by the Participant or such other consideration (or no consideration) as set by the Committee as part of the terms and conditions of the Award, provided that except as provided in Section 11, in the event of a Participant’s retirement, permanent disability, other termination of employment or death, or in cases of special circumstances, the Committee may, in its sole discretion, waive in whole or in part any or all remaining restrictions with respect to such Participant’s shares of Restricted Stock. Unrestricted Shares, evidenced in such manner as the Committee shall deem appropriate, shall be issued to the Participant after the period of forfeiture, as determined or modified by the Committee, shall expire.
SECTION 8. PERFORMANCE AWARDS. Performance Awards may be issued hereunder to Participants, either alone or in addition to other Awards granted under the Plan, for such consideration as determined by the Committee, in its sole discretion, and the Committee may issue such Performance Awards for no consideration or for such minimum consideration as may be required by applicable law. The performance criteria to be achieved during any Performance Period, the length of the Performance Period and the other terms and conditions and provisions with respect to the Performance Award shall be determined by the Committee upon the grant of each Performance Award. Except as provided in Section 10, Performance Awards will be distributed only after the end of the relevant Performance Period. Performance Awards may be paid in cash, Shares or any combination thereof, in the sole discretion of the Committee at the time of payment. The performance levels to
|
|
be achieved for each Performance Period and the amount of the Award to be distributed shall be conclusively determined by the Committee. Performance Awards may be paid in a lump sum or in installments following the close of the Performance Period. The maximum value of the property, including cash, that may be paid or distributed to any Participant pursuant to a grant of Performance Units made in any one calendar year shall be $2,500,000. The provisions of Performance Awards need not be the same with respect to each Participant.
SECTION 9. OTHER STOCK UNIT AWARDS.
(a) Other Stock Unit Awards Administration. Other Awards of Shares and other Awards that are valued in whole or in part by reference to, or are otherwise based on, Shares or other property (“Other Stock Unit Awards”) may be granted hereunder to Participants, either alone or in addition to other Awards granted under the Plan. Other Stock Unit Awards may be paid in Shares, cash or any other form of property as the Committee shall determine.
(b) Terms and Conditions. Other Stock Unit Awards granted under this Section 9 may be issued for such consideration as determined by the Committee in its sole discretion, and the Committee may issue such Awards for no consideration or for such minimum consideration as may be required by applicable law. Shares (including securities convertible into Shares) purchased pursuant to a purchase right awarded under this Section 9 shall be purchased for such consideration as the Committee shall in its sole discretion determine, which shall not be less than the Fair Market Value of such Shares or other securities as of the date such purchase right is awarded. The terms and conditions and other provisions with respect to Other Stock Unit Awards shall be determined by the Committee. The provisions of Other Stock Unit Awards need not be the same with respect to each Participant.
SECTION 10. CHANGE IN CONTROL PROVISIONS.
(a) Impact of Event. Notwithstanding any other provision of the Plan to the contrary, but subject to the provisions of Section 10(c), in the event of a Change in Control:
|
|
|
|
|
|
|
|
(b) Change in Control Cash-Out. Notwithstanding any other provision of the Plan, during the 60-day period from and after a Change in Control (the “Exercise Period”), if the Committee shall determine at, or at any time after the time of grant, a Participant holding an Option shall have the right, whether or not the Option is fully exercisable and in lieu of the payment of the option price for the Shares being purchased under the Option and by giving notice to Worthington, to elect (within the Exercise Period) to, surrender all or part of the Option to Worthington and to receive cash, within 30 days of such notice, in an amount equal to the amount by which the Change in Control Price per Share on the date of such election shall exceed the purchase price per Share under the Option (the “Spread”) multiplied by the number of Shares granted under the Option as to which the right granted under this Section 10(b) shall have been exercised.
|
|
(c) Provisions not Applicable. The provisions of this Section 10 shall not apply (i) if the Committee determines at the time of grant that such Section shall not apply or (ii) to any Change in Control when expressly provided otherwise by a three-fourths vote of the Whole Board, but only if a majority of the members of the Board then in office and acting upon such matters shall be Continuing Directors.
SECTION 11. CODE SECTION 162(m) PROVISIONS.
(a) Applicability. Notwithstanding any other provisions of the Plan, if the Committee determines at the time Restricted Stock, a Performance Award or an Other Stock Unit Award is granted to a Participant that such Participant is, or is likely to be at the time such Participant recognizes income for federal income tax purposes in connection with such Award a Covered Employee then the Committee may provide that this Section 11 is applicable to such Award.
(b) Performance Goals. If an Award is subject to this Section 11, then the lapsing of restrictions thereon and the distribution of cash or Shares pursuant thereto, as applicable, shall be subject to the achievement of one or more objective performance goals established by the Committee, which shall be based on the attainment of one or any combination of the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Such performance goals may be stated in absolute terms or relative to comparison entities, indices or other measures to be achieved during a Performance Period and may be applied solely with reference to the Company or an affiliate, business unit or division of the Company or relatively between the Company or an affiliate, business unit or division of the Company and one or more unrelated entities or business units or indices.
|
|
The Committee may provide in any performance goal that any evaluation of performance may include or exclude the impact of specific items related to the time period over which performance is evaluated including the following: (i) asset write-downs; (ii) litigation or claim judgments or settlements; (iii) changes in tax laws, accounting principles (or interpretations thereof), accounting methods (including the differences between LIFO and FIFO accounting methods), or other laws or provisions affecting reported results; (iv) any reorganization or restructuring program or restructuring costs; (v) extraordinary or non-recurring items; (vi) acquisitions or divestitures; and (vii) foreign exchange gains and losses. To the extent such inclusions or exclusions affect an Award subject to this Section 11, they shall be prescribed in a form that meets the requirements of Section 162(m) of the Code and the Treasury Regulations promulgated thereunder for deductibility.
Such performance goals shall be set by the Committee within the time period prescribed by, and shall otherwise comply with the requirements of, Section 162(m) of the Code and the Treasury Regulations promulgated thereunder.
[NOTE: Section 11(b) was amended pursuant to the First Amendment to the Plan effective as of June 26, 2013.]
(c) Limitations on Adjustments. Notwithstanding any provision of this Plan other than Section 10, with respect to any Award that is subject to this Section 11, the Committee may not adjust upwards the amount payable pursuant to such Award, nor may it waive the achievement of the applicable performance goals except in the case of the death or disability of the Participant.
(d) Other Restrictions. The Committee shall have the power to impose such other restrictions on Awards subject to this Section 11 as it may deem necessary or appropriate to ensure that such Awards satisfy all requirements for “performance-based compensation” within the meaning of Section 162(m)(4)(B) of the Code or any successor provision.
SECTION 12. AMENDMENTS AND TERMINATION. The Board may amend, alter or discontinue the Plan, but no amendment, alteration, or discontinuation shall be made that would impair the rights of a Participant under an Award theretofore granted, without the Participant’s consent, or that without the approval of the shareholders of Worthington would:
|
|
|
|
The Committee may amend the terms of any Award theretofore granted, prospectively or retroactively, but no such amendment shall impair the rights of any Participant without the Participant’s consent.
SECTION 13. GENERAL PROVISIONS.
(a) No Assignment. Unless the Committee determines otherwise at the time the Award is granted, no Award, and no Shares subject to Awards described in Section 9 which have not been issued or as to which any applicable restriction, performance period has not lapsed, may be sold, assigned, transferred, pledged or otherwise encumbered, except by will or by the laws of descent and distribution; provided that, if so determined by the Committee, a Participant may, in the manner established by the Committee, designate a beneficiary to exercise the rights of the Participant with respect to any Award upon the death of the Participant. Each Award shall be exercisable, during the Participant’s lifetime, only by the Participant or, if permissible under applicable law, by the Participant’s guardian or legal representative.
(b) Term of Awards. The term of each Award shall be for such period of months or years from the date of its grant as may be determined by the Committee; provided that in no event shall the term of any Option or Stock Appreciation Right exceed a period of 10 years from the date of its grant. [NOTE: Section 13(b) was amended pursuant to Second Amendment to the Plan effective as of September 26, 2013.]
(c) No Right to Award. No Employee or Participant shall have any claim to be granted any Award under the Plan and there is no obligation for uniformity of treatment of Employees or Participants under the Plan.
|
|
(d) Written Agreement Required. The prospective recipient of any Award under the Plan shall not, with respect to such Award, be deemed to have become a Participant, or to have any rights with respect to such Award, until and unless such recipient shall have executed an agreement or other instrument evidencing the Award and delivered a fully executed copy thereof to Worthington, and otherwise complied with the then applicable terms and conditions.
(e) Adjustments. Except as provided in Section 11, the Committee shall be authorized to make adjustments in Performance Award criteria or in the terms and conditions of other Awards in recognition of unusual or nonrecurring events affecting the Company or its financial statements or changes in applicable laws, regulations or accounting principles. The Committee may correct any defect, supply any omission or reconcile any inconsistency in the Plan or any Award in the manner and to the extent it shall deem desirable to carry it into effect. In the event Worthington shall assume outstanding employee benefit awards or the right or obligation to make future awards in connection with the acquisition of another corporation or business entity, the Committee may, in its discretion, make such adjustments in the terms of Awards under the Plan as it shall deem appropriate.
(f) Cancellations and Forfeitures. The Committee shall have full power and authority to determine whether, to what extent, and under what circumstances, any Award shall be canceled or suspended. In particular, but without limitation, all outstanding Awards to any Participant shall be canceled if the Participant, without the consent of the Committee, while employed by the Company or after termination of such employment, becomes associated with, employed by, renders services to, or owns any interest in (other than any nonsubstantial interest, as determined by the Committee), any business that is in competition with the Company or with any business in which the Company has a substantial interest as determined by the Committee.
In the event a Participant terminates his or her employment with the Company for any reason whatsoever, and within 18 months after the date thereof becomes associated with, employed by, renders services to, or owns any interest in (other than any nonsubstantial interest, as determined by the Committee), any business that is in competition with the Company or with any business in which the Company has a substantial interest as determined by the Committee, the Committee, in its sole discretion, may require such Participant to return to the Company the economic value of any Award which is realized or obtained (measured at the date of exercise) by such Participant at any time during the period beginning on that date which is six months prior to the date of such Participant’s termination of employment with the Company.
(g) Securities Laws Restrictions. No Shares shall be issued under the Plan unless counsel for Worthington shall be satisfied that such issuance will be in compliance with applicable Federal and state securities laws. All certificates for Shares delivered under the Plan pursuant to any Award shall be subject to such stock-transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange upon which the Shares are then listed, and any applicable Federal or state securities law, and the Committee may cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions.
(h) Payment Requirements. Except as otherwise required in any applicable Award Agreement or by the terms of the Plan, recipients of Awards under the Plan shall not be required to make any payment or provide consideration other than the rendering of services.
(i) Withholding. Worthington shall be authorized to withhold from any Award granted or payment due under the Plan the amounts of withholding taxes. The authority provided in this tax withholding section includes authority to determine the amounts to be withheld (including Shares or other portions of Awards) in satisfaction of a Participant’s or former Participant’s withholding obligations, or in satisfaction of other tax obligations, either on a mandatory or elective basis, as permitted in the discretion of Committee due in respect of an Award or payment hereunder and to take such other action as may be necessary in the opinion of Worthington to satisfy all obligations for the payment of such taxes. The Committee shall be authorized to establish procedures for election by Participants to satisfy such withholding taxes by delivery of, or directing Worthington to retain, Shares, unless otherwise specified by the Committee in the Award Agreement. [NOTE: Section 13(i) was amended pursuant to the Third Amendment to the Plan effective as of June 28, 2017.]
(j) Other Arrangements. Nothing contained in this Plan shall prevent the Board from adopting other or additional compensation arrangements, subject to shareholder approval if such approval is otherwise required, and such arrangements may be either generally applicable or applicable only in specific cases.
|
|
(k) Applicable Law. The validity, construction, and effect of the Plan and any rules and regulations relating to the Plan shall be determined in accordance with the laws of the State of Ohio and applicable Federal law.
(l) Invalid Provisions. If any provision of this Plan is or becomes or is deemed invalid, illegal or unenforceable in any jurisdiction, or would disqualify the Plan or any Award under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to applicable laws or if it cannot be construed or deemed amended without, in the determination of the Committee, materially altering the intent of the Plan, it shall be stricken and the remainder of the Plan shall remain in full force and effect.
(m) Foreign Nationals. Awards may be granted to Employees who are foreign nationals or employed outside the United States, or both, on such terms and conditions different from those specified in the Plan as may, in the judgment of the Committee, be necessary or desirable in order to recognize differences in local law or tax policy. The Committee also may impose conditions on the exercise or vesting of Awards in order to minimize the Company’s obligation with respect to tax equalization for Employees on assignments outside their home country.
(n) No Right to Employment. Neither the adoption of the Plan nor the granting of any Award shall confer upon any employee of the Company any right to continued employment with the Company, nor shall it interfere in any way with the right of the Company to terminate the employment of any of its employees at any time, with or without cause.
(o) Treatment as Compensation for Other Purposes. Payments and other benefits received by a Participant under an Award made pursuant to the Plan shall not be deemed a part of a Participant’s regular, recurring compensation for purposes of the termination indemnity or severance pay law of any country and shall not be included in, nor have any effect on, the determination of benefits under any other employee benefit plan or similar arrangement provided by the Company unless expressly so provided by such other plan or arrangements, or except where the Committee expressly determines that an Award or portion of an Award should be included to accurately reflect competitive compensation practices or to recognize that an Award has been made in lieu of a portion of competitive annual cash compensation. Awards under the Plan may be made in combination with or in tandem with, or as alternatives to, grants, awards or payments under any other Company plans. The Plan notwithstanding, the Company may adopt such other compensation programs and additional compensation arrangements as it deems necessary to attract, retain and reward employees for their service with the Company.
SECTION 14. EFFECTIVE DATE OF THE PLAN. The Plan became effective on the Effective Date. [NOTE: Section 14 was amended pursuant to the Second Amendment to the Plan effective as of September 26, 2013.]
SECTION 15. DEFINITIONS. As used in the Plan, the following terms shall have the meanings set forth below:
(a)“Acquiring Person” means any Person (any individual, firm, corporation or other entity) who or which, together with all Affiliates and Associates, has acquired or obtained the right to acquire the beneficial ownership of 25% or more of the Shares then outstanding.
(b)“Affiliate” and “Associate” shall have the respective meanings ascribed to such terms in Rule 12b-2 of the General Rules and Regulations under the Exchange Act
(c)“Award” shall mean any Option, Stock Appreciation Right, Restricted Stock Award, Performance Share, Performance Unit, Other Stock Unit Award, or any other right, interest, or option relating to Shares granted pursuant to the provisions of the Plan.
(d) “Award Agreement” shall mean any written agreement, contract, or other instrument or document evidencing any Award granted by the Committee hereunder.
(e)“Board” shall mean the Board of Directors of Worthington
(f)A “Change in Control” shall have occurred when any Person (other than (i) the Company, (ii) any employee benefit plan of the Company or any trustee of or fiduciary with respect to any such plan when acting in such capacity, or (iii) any Person who, on the Effective Date of the Plan, was an Affiliate of the Company owning in excess of 10% of the outstanding shares of Worthington and the respective successors,
|
|
executors, legal representatives, heirs and legal assigns of such Person), alone or together with its Affiliates and Associates, has acquired or obtained the right to acquire the beneficial ownership of 25% or more of the Shares then outstanding; provided, however, that with respect to any Award subject to Section 409A of the Code that is settled or distributed upon the occurrence of a Change in Control, no settlement or distribution of such Award shall be made unless the Change in Control also constitutes a “change in control event” within the meaning of Section 409A of the Code.
(g)“Change in Control Price Per Share” shall mean the price per Share (i) paid by the Acquiring Person in connection with the transaction(s) that results in the Change in Control; or (ii) at any time after the Change in Control and before the Participant exercises his election under Section 10(b), the Fair Market Value of the Shares.
(h)“Code” shall mean the Internal Revenue Code of 1986, as amended from time to time, and any successor thereto.
(i)“Committee” shall mean the Compensation and Stock Option Committee of the Board, composed of no fewer than three directors, each of whom is a Non-Employee Director and an “outside director” within the meaning of Section 162(m) of the Code.
(j)“Company” shall mean Worthington and its subsidiaries, direct and indirect. Subsidiaries of Worthington shall include (i) any entity of which Worthington owns, directly or indirectly, 50% or more of the total combined voting power of all classes of stock, if the entity is a corporation, or of the capital or profits interests, if the entity is a partnership or another form of entity and (ii) any other entity in which Worthington has a 20% or greater direct or indirect equity interest and which is designated as a “Subsidiary” by the Committee for purposes of this Plan; provided, however, that with respect to any Award that is subject to Section 409A of the Code, “Company” shall mean Worthington and its subsidiaries with whom Worthington would be considered a single employer under Sections 414(b) and (c) of the Code, but modified as permitted by Treasury Regulation §1.409A-1(b)(5)(iii)(E)(1). [NOTE: Section 15(j) was amended pursuant to the Second Amendment to the Plan effective as of September 26, 2013.]
(k)“Continuing Director” means any person who was a member of the Board on the Effective Date of the Plan or thereafter elected by the shareholders of Worthington or appointed by the Board prior to the date as of which the Acquiring Person became a Substantial Shareholder (as such term is defined in Article Seventh of Worthington’s Amended Articles of Incorporation) or, a Person designated (before his initial election or employment as a director) as a Continuing Director by three-fourths of the Whole Board, but only if a majority of the Whole Board shall then consist of Continuing Directors
(l)“Covered Employee” shall mean a “covered employee” within the meaning of Section 162(m)(3) of the Code.
(m)“Effective Date” shall mean September 18, 1997.
(n)“Employee” shall mean any common law employee of the Company. Unless otherwise determined by the Committee in its sole discretion, for purposes of the Plan, an Employee shall be considered to have terminated employment and to have ceased to be an Employee if his or her employer ceases to be a subsidiary of Worthington, even if he or she continues to be employed by such employer. [NOTE: The first sentence of Section 15(n) was amended pursuant to the Second Amendment to the Plan effective September 26, 2013.]
(o)“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from time to time, and any successor thereto.
(p)“Fair Market Value” The value of one Share on any relevant date, determined under the following rules:
|
|
[1] If the Shares are traded on an exchange or recognized market or quotation system on which “closing prices” are reported, the reported “closing price” on the relevant date, if it is a trading day, otherwise on the next trading day;
[2] If the Shares are traded over-the-counter with no reported closing price, the mean between the highest bid and the lowest asked prices on the relevant date, if it is a trading day, otherwise on the next trading day; or
[3] If neither subsections [1] or [2] of this definition apply, the fair market value as determined by the Board in good faith and consistent with any applicable provisions under the Code, except with respect to Options and SARs, in which event the fair market value as determined by the reasonable application of a reasonable valuation method taking into account all information material to the value of the Company satisfying the requirements of Code §409A.
(q)“Incentive Stock Option” shall mean an Option granted under Section 5 hereof that is intended to meet the requirements of Section 422 of the Code or any successor provision thereto.
(r)“Non-Employee Director” shall have the meaning set forth in Rule 16b-3(b)(3) promulgated by the Securities and Exchange Commission under the Exchange Act or any successor definition adopted by the Securities and Exchange Commission.
(s)“Nonstatutory Stock Option” shall mean an Option granted under Section 5 hereof that is not intended to be an Incentive Stock Option.
(t)“Option” shall mean any right granted to a Participant under the Plan allowing such Participant to purchase Shares at such price or prices and during such period or periods as the Committee shall determine.
(u)“Other Stock Unit Award” shall mean any right granted to a Participant by the Committee pursuant to Section 9 hereof.
(v)“Participant” shall mean an Employee who is selected by the Committee to receive an Award under the Plan.
(w)“Performance Award” shall mean any Award of Performance Shares or Performance Units pursuant to Section 8 hereof.
(x)“Performance Period” shall mean that period established by the Committee at the time any Performance Award is granted or at any time thereafter during which any performance goal(s) specified by the Committee with respect to such Performance Award are to be measured.
(y)“Performance Share” shall mean any grant pursuant to Section 8 hereof of a unit valued by reference to a designated number of Shares, which value may be paid to the Participant by delivery of such property as the Committee shall determine, including, without limitation, cash, Shares, or any combination thereof, upon achievement of such performance goals during the Performance Period as the Committee shall establish at the time of such grant or thereafter.
(z)“Performance Unit” shall mean any grant pursuant to Section 8 hereof of a unit valued by reference to a designated amount of property other than Shares, which value may be paid to the Participant by delivery of such property as the Committee shall determine, including, without limitation, cash, Shares, or any combination thereof, upon achievement of such performance goals during the Performance Period as the Committee shall establish at the time of such grant or thereafter.
(aa)“Person” shall mean any individual, corporation, partnership, association, joint-stock company, trust, unincorporated organization, limited liability company, other entity or government or political subdivision thereof.
|
|
(bb)“Restricted Stock” shall mean any Share issued with the restriction that the holder may not sell, transfer, pledge, or assign such Share and with such other restrictions as the Committee, in its sole discretion, may impose (including, without limitation, any restriction on the right to vote such Share, and the right to receive any cash dividends), which restrictions may lapse separately or in combination at such time or times, in installments or otherwise, as the Committee may deem appropriate.
(cc)“Restricted Stock Award” shall mean an award of Restricted Stock under Section 7 hereof.
(dd)“Shares” shall mean the common shares, without par value, of Worthington and such other securities of Worthington as the Committee may from time to time determine.
(ee)“Stock Appreciation Right” shall mean any right granted to a Participant pursuant to Section 6 hereof to receive, upon exercise by the Participant, the excess of (i) the Fair Market Value of one Share on the date of exercise over (ii) the grant price of the right on the date of grant, or if granted in connection with an outstanding Option on the date of grant of the related Option, as specified by the Committee in its sole discretion, which, other than in the case of substitute Awards, shall not be less than the Fair Market Value of one Share on such date of grant of the right or the related Option, as the case may be. Any payment by Worthington in respect of such right may be made in cash, Shares, other property, or any combination thereof, as the Committee, in its sole discretion, shall determine.
(ff)“Treasury Regulations” means any regulations promulgated by the Department of Treasury and/or Internal Revenue Service under the Code.
(gg)“Whole Board” means the total number of directors which Worthington would have if there were no vacancies
(hh)“Worthington” shall mean Worthington Industries, Inc., an Ohio corporation.
SECTION 16. SECTION 409A. This Plan is intended to comply with or be exempt from the requirements of Section 409A of the Code and the Treasury Regulations promulgated thereunder, as applicable, and shall be interpreted, administered and operated accordingly. Nothing in this Plan should be construed as a guarantee or entitlement of any particular tax treatment to a Participant. None of the Company, the Board, the Committee or any other Person shall any liability with respect to any Participant in the event this Plan fails to comply with the requirements of Section 409A of the Code.
|
|
w SCAN TO VIEW MATERIALS & VOTE WORTHINGTON INDUSTRIES, INC. C/O BROADRIDGE P.O. BOX 1342 BRENTWOOD, NY 11717 VOTE BY INTERNET Before the Date of the Annual Meeting - Go to www.proxyvote.com or, using a mobile device, scan the QR barcode above. Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m., Eastern Daylight Time, on September 24, 2019.27, 2022. Have your proxy card or Notice of Internet Availability of Proxy Materials or proxy card in hand when you access the website or scan the QR barcode and follow the instructions to obtain your records and to create an electronic voting instruction form. During the Annual Meeting - Go to www.virtualshareholdermeeting.com/WOR19WOR2022 You may attend the Annual Meeting via the Internet and vote during the Annual Meeting. Have the information that is printed in the box marked by the arrowdirectly after "Control #" on your proxy card or Notice of Internet Availability of Proxy Materials or proxy card available and follow the instructions. VOTE BY TELEPHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m., Eastern Daylight Time, on September 24, 2019.27, 2022. Have your proxy card or Notice of Internet Availability of Proxy Materials or proxy card in hand when you call and then follow the instructions. VOTE BY MAIL If you received a printed copy of the proxy materials, mark,complete, 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, NYNew York 11717. WORTHINGTON INDUSTRIES, INC. ATTN: INVESTOR RELATIONS 200 OLD WILSON BRIDGE ROAD COLUMBUS, OH 43085 E83572-P27827D89489-P78486 For All Withhold All For All Except WORTHINGTON INDUSTRIES, INC. To withhold authority to vote for any individual nominee(s), mark “For"For All Except“Except" and write the number(s) of the nominee(s) on the line below. WORTHINGTON INDUSTRIES, INC. 1. Election of four directors, each to serve for a term of three years to expire at the 20222025 Annual Meeting of Shareholders: ! ! ! Nominees: 01) Kerrii B. Anderson 02) David P. Blom 03) John P. McConnell 04) Mary Schiavo For Against Abstain ! ! ! 2. Approval of advisory resolution on executive compensation. 3. Approvalto approve the compensation of the Fourth Amendment to the Worthington Industries, Inc. Amended and Restated 1997 Long-Term Incentive Plan, to authorize 1,500,000 additional common shares. 4.Company's named executive officers. ! ! ! 3. Ratification of selection of KPMG LLP as the Company's independent registered public accounting firm of the Company for the fiscal year ending May 31, 2020.2023. The Board of Directors of the Company recommends that you vote FOR each of the listed nominees for election as a director, and FOR Proposals 2 3 and 4.3. NOTE: In their discretion, the persons named as proxies arewill be authorized to vote on such other business (none known by the Company at the time of solicitation of this proxy) as may properly come before the Annual Meeting. EachMeeting of the foregoing proposals is more fully described in the Proxy Statement for the Annual Meeting.Shareholders. Please sign exactly as your name appears on this proxy card. Executors, administrators, trustees, guardians, attorneys and agents must give their full titles. If shareholder is a corporation, an authorized officer must sign in full corporate name. If shareholder is a partnership or other entity, an authorized person must sign in the entity's full name. If the common shares represented by this proxy are held in joint tenancy, both holders must sign this proxy card. Signature (Joint Owners) Date Signature [PLEASE SIGN WITHIN BOX] Date TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: KEEP THIS PORTION FOR YOUR RECORDSDETACH AND RETURN THIS PORTION ONLY
NOTICE OF VIRTUAL ANNUAL MEETING OF SHAREHOLDERS WEDNESDAY, SEPTEMBER 25, 2019,28, 2022, AT 3:00 P.M., EASTERN DAYLIGHT TIME Access to this year’s virtual Annual Meeting of Shareholders will be available atwww.virtualshareholdermeeting.com/WOR19. A replay of the Annual Meeting of Shareholders will be available for one year.at www.virtualshareholdermeeting.com/WOR2022. Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Shareholders of Worthington Industries, Inc. to be Held on September 25, 2019: The28, 2022: Worthington Industries, Inc.'s letter to shareholders, Notice of Annual Meeting of Shareholders, the Proxy Statement, 2022 Annual Report and the Company's 2019 Annual Report to Shareholdersform of proxy are available at www.proxyvote.com. E83573-P27827D89490-P78486 WORTHINGTON INDUSTRIES, INC. PROXY THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF WORTHINGTON INDUSTRIES, INC. PLEASE COMPLETE, SIGN AND DATE THIS PROXY CARD WITHIN THE BOXES ON THE REVERSE SIDE AND RETURN IT PROMPTLYINPROMPTLY IN THE ENCLOSED ENVELOPE. Each shareholder identified on this proxy card hereby constitutes and appoints John P. McConnell, B. Andrew Rose, Joseph B. Hayek and Dale T. Brinkman,Patrick J. Kennedy, and each of them, with full power of substitution, the lawful agents and proxies of the shareholder to attend the Annual Meeting of Shareholders of Worthington Industries, Inc. (the "Company") to be held via live webcast only at www.virtualshareholdermeeting.com/WOR19,WOR2022, on Wednesday, September 25, 2019,28, 2022, at 3:00 p.m., Eastern Daylight Time, and to vote all of the common shares of the Company that the shareholder is entitled to vote at such Annual Meeting, as directed on the reverse side with respect to the matters set forth on the reverse side, and to vote such common shares with discretionary authority on all other matters (none known by the Company at the time of solicitation of this proxy) which are properly brought before the Annual Meeting. This proxy, when properly executed, will be voted as directed. If no direction is made, except in the case of broker non-votes, this proxythe persons named herein as proxies will be votedvote FOR the election of all nominees listed on the reverse side in Proposal 1 and FOR Proposals 2 3 and 4.3. All proxies previously given or executed by each shareholder identified on this proxy card are hereby revoked. Continued and to be signed and dated on reverse side