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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.
Filed by the Registrant ☒
Filed by a Party other than the Registrant ☐
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Preliminary Proxy Statement
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material under §240.14a-12
Trinseo PLC
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Preliminary Proxy Statement |
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
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Definitive Proxy Statement |
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Definitive Additional Materials |
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Soliciting Material under §240.14a-12
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(Name of Registrant as Specified In Its Charter)
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Trinseo S.A. |
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
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Table of ContentsPerson(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
☒ No fee required.
☐ Fee paid previously with preliminary materials.
☐ Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.
Trinseo PLC
REGISTERED OFFICE:
4 rue Lou Hemmer
L-1748 Luxembourg
Grand-duchy of LuxembourgPRINCIPLE
Riverside One
Sir John Rogerson’s Quay
Dublin 2
Dublin, Ireland
D02 X576 PRINCIPAL PLACE OF BUSINESS:
1000 Chesterbrook Boulevard,
440 E. Swedesford Rd., Suite 300
Berwyn, PA 19312May [X], 2016
301
Wayne, Pennsylvania 19087 USA
[ ], 2023
We cordially invite you to attend our 20162023 annual general meeting of shareholders (the “Annual Meeting”) to be held on Wednesday, June 14, 2023 at 11:30 a.m. (local time) at the InterContinental Dublin, located at Simmonscourt Road, Ballsbridge, Dublin, D04 A9K8. Further details regarding admission to the Annual Meeting as well as the business to be conducted at the meeting are more fully described in the accompanying materials.
In addition to the typical proposals to be voted on at our Annual Meeting, we are submitting to our shareholders a proposal asking shareholders to approve an amendment to our Amended & Restated 2014 Omnibus Incentive Plan, which we believe is necessary to continue to grant incentive awards to our employees.
We describe in detail the actions we expect to take in the attached Notice of the 2023 Annual General Meeting of Shareholders and proxy statement. We have also made available a copy of our Annual Report on Tuesday, June 21, 2016, at 11:00 a.m. (local time), to be held at the Sofitel Luxembourg Europe located at 4, rue du Fort Niedergrünewald, BP 512 / Quartier Européen Nord, L-2015 Luxembourg, Grand Duchy of Luxembourg. We are holding this meeting to solicit your approval of the following:1.To elect three Class II directors specifically named in the proxy statement, each to serveForm 10-K for a term of three years;
2.To ratify the Board's appointment of Stephen F. Thomas as director of the Board to fill a vacancy in Class III, with a remaining term of one year;
3.To ratify the Company's directors' compensation program;
4.To approve, on an advisory basis, of the compensation paid by the Company to its named executive officers;
5.To approve the Company's annual accounts prepared in accordance with accounting principles generally accepted in Luxembourg for theour fiscal year ended December 31, 20152022. We encourage you to read the Form 10-K, which includes information on our operations and its consolidatedproducts, as well as our audited financial statements preparedstatements.
As in accordanceprevious years, we will be using the “Notice and Access” method of providing proxy materials to shareholders via the Internet. We believe that this process provides shareholders with accounting principles generally accepted ina convenient and quick way to access the United States includingproxy materials and vote, while allowing us to conserve natural resources and reduce the costs of printing and distributing the proxy materials. We will mail to most of our shareholders a footnote reconciliationNotice of equity and net income to International Financial Reporting StandardsInternet Availability of Proxy Materials for the year ended December 31, 2015;
6.To approveAnnual Meeting containing instructions on how to access our proxy statement and Annual Report and vote electronically via the allocationInternet. Each notice will also contain instructions on how to receive a paper copy of the resultsproxy materials. All shareholders who do not receive a notice will receive a paper copy of the year ended December 31, 2015;
7.To approve the granting and dischargeproxy materials by mail or an electronic copy of the Company's directors and auditor for the performance of their respective duties during the year ended December 31, 2015;
8.To ratify the appointment of PricewaterhouseCoopers Société cooperative to be the Company's independent auditor for all statutory accounts requiredproxy materials by Luxembourg law for the year ended December 31, 2016;
9.To ratify the appointment of PricewaterhouseCoopers LLP to be the Company's independent registered public accounting firm for the year ended December 31, 2016;
10.To authorize the Board to make repayments of equity at times and in amounts set by the Board in its discretion and within the limits of Luxembourg law;
11.To authorize the repurchase up to 4.5 million ordinary shares over the next two (2) years; and
12.Any other business properly brought before the Annual General Meeting of Shareholders.
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email.
Your vote is important regardless of the number of shares you own. Whether or not you plan to attend the Annual General Meeting, of Shareholders, we encourage you to consider the matters presented in the proxy statement and vote as soon as possible. Instructions for Internet and telephone voting, are included with our Notice of Internet Availability of Trinseo's Proxy Materials. If you prefer, you canas well as instructions to request to receive proxy materials by mail, includingare included with the Notice of Internet Availability of Trinseo’s Proxy Materials for the Annual Meeting. If you are a registered shareholder, you can also request to receive a proxy card and vote by mail by completing and signing the enclosed proxy card and returning it in the envelope provided.mail.
Sincerely yours,
Christopher D. Pappas
Frank A. Bozich
President and Chief Executive Officer
Annual General Meeting of Shareholders
Luxembourg, Grand Duchy of Luxembourg
InterContinental Dublin
Simmonscourt Road
Ballsbridge, Dublin, D04 A9K8
June 21, 2016
Meeting begins at 14, 2023
11:00 a.m. CET Doors Open at 10:30 a.m. CET
Sofitel Luxembourg Europe
4, rue du Fort Niedergrünewald
BP 512 / Quartier Européen Nord
L-2015 Luxembourg
Grand Duchy of LuxembourgRegistered office of I.S.T.
Trinseo S.A.:4 rue Lou Hemmer
L-1748 Luxembourg
Grand Duchy of Luxembourg
PLC
REGISTERED OFFICE:
Riverside One
Sir John Rogerson’s Quay
Dublin 2
Dublin, Ireland
D02 X576 Principal executive offices of Trinseo S.A.1000 Chesterbrook Boulevard,PLC
440 E. Swedesford Rd., Suite 300
Berwyn,301
Wayne, Pennsylvania 19312
(610) 240-320019087 USA
+1 610-240-3200 NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS To the Shareholders of Trinseo S.A.:PLC:
Notice is hereby given that an Annual General Meetingannual general meeting of Shareholdersshareholders (the “Annual Meeting”) of Trinseo S.A. ("PLC (“we," "Trinseo"” “Trinseo” or the "Company"“Company”) will be held on Wednesday, June 14, 2022, at 11:30 a.m. Irish Standard Time, at the Sofitel Luxembourg Europe, 4, rue du Fort Niedergrünewald, BP 512 / Quartier Européen Nord, L-2015 Luxembourg, Grand Duchy of Luxembourg on Tuesday, June 21, 2016,InterContinental Dublin, located at 11:00 a.m., local time,Simmonscourt Road, Ballsbridge, Dublin, D04 A9K8, for the following purposes asdescribed below and in further describeddetail in the proxy statement accompanying this notice: 1.
To elect, three Class IIby separate resolutions, eleven (11) directors specifically named in the proxy statement, each to serve for a term of three years.
2.To ratifyone year expiring at the Board's appointment of Stephen F. Thomas as director of the Board to fill a vacancy in Class III, with a remaining term of one year;
3.To ratify the Company's directors' compensation program;
4.2024 annual general meeting;
2.
To approve, on an advisory basis, of the compensation paid by the Company to its named executive officers;
5.To approve the Company's annual accounts prepared in accordance with accounting principles generally accepted in Luxembourg for the year ended December 31, 2015 and its consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States including a footnote reconciliation of equity and net income to International Financial Reporting Standards for the year ended December 31, 2015;
6.To approve the allocation of the results of the year ended December 31, 2015;
7.To approve the granting and discharge of the Company's directors and auditor for the performance of their respective duties during the year ended December 31, 2015;
8.
3.
To ratify, the appointment of PricewaterhouseCoopers Société cooperative to be the Company's independent auditor for all statutory accounts required by Luxembourg law for the year ended December 31, 2016;
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9.To ratifynon-binding advisory vote, the appointment of PricewaterhouseCoopers LLP to be(“PwC”) as the Company'sCompany’s independent registered public accounting firm for the year ending December 31, 2023 and to authorize, by binding vote, the Audit Committee of the Company’s Board of Directors (the “Board”) to set the auditors’ remuneration;
4.
To approve a proposal to grant the Board authority to issue shares under Irish law;
5.
To approve a proposal to grant the Board authority to opt out of statutory pre-emption rights, with respect to up to a maximum of 10% of issued ordinary share capital, under Irish law;
6.
To set the price range for the Company’s re-issuance of treasury shares;
7.
To approve an amendment to the Company’s Omnibus Incentive Plan; and
8.
Transacting any other business that may properly come before the Annual Meeting.
All shareholders of record at the close of business on April 20, 2023 (the record date for the Annual Meeting) may attend.
Beneficial shareholders who held their shares through a broker, bank or other nominee on the record date for the Annual Meeting (“beneficial holders”), who wish to attend the Annual Meeting, must register by going to the Company’s voting website, proxyvote.com, entering their 16-digit control number found on their proxy card or in their Annual Meeting materials, and clicking on the box labeled “Register for Meeting.” Beneficial holders who wish to vote their shares by proxy during the Annual Meeting must obtain a legal proxy, executed in their favor, from their broker, bank or other nominee. Shareholders of record who wish to attend the Annual Meeting are also encouraged to register to attend on proxyvote.com, and may vote their shares during the Annual Meeting.
Proposals 1, 2, 3, 4, and 7 are ordinary resolutions requiring either approval of a majority of the votes cast in person or by proxy at the Annual Meeting, or requiring advisory approval by shareholders which advisory approval will be taken into consideration by the Board. Proposals 5 and 6 are special resolutions requiring approval of at least seventy-five percent (75%) of the votes cast in person or by proxy at the Annual Meeting.
Our Irish statutory financial statements for the fiscal year ended December 31, 2016;
10.To authorize2022, including the Board to make repaymentsreports of equitythe directors and statutory auditors thereon, will be presented at times and in amounts setthe annual general meeting. There is no requirement under Irish law that such statements be approved by the Board in its discretionshareholders and withinno such approval will be sought at the limitsannual general meeting. Our Irish statutory financial statements
will be available on our website at investor.trinseo.com/home/financials, under “2022 Financial Statements,” after the date of Luxembourg law;
11.To authorize the repurchase up to 4.5 million ordinary shares over the next two (2) years; and
12.Any other business properly brought before the Annual General Meeting of Shareholders.this proxy statement but no later than May 24, 2023.
It is expected that the Notice of Annual General Meeting and this proxy statement will first be providedavailable to shareholders on or about May X, 2016.1, 2023. On or about May [X], 2016,1, 2023, the Company will also begin mailing a Notice of Internet Availability of Trinseo'sTrinseo’s Proxy Materials to shareholders informing them that this proxy statement and voting instructions are available online. As more fully described in that Notice, all shareholders may choose to access proxy materials on the Internet or may request to receive paper copies of the proxy materials. Shareholders of record at the close of business on April 14, 201620, 2023 are entitled to notice of, and entitled to vote at, the Annual General Meeting and any adjournments or postponements thereof. To Whether or not you expect to attend the Annual General Meeting, you must demonstrateplease complete, sign, date, and promptly return the enclosed proxy card in the envelope that you were awe or your bank or brokerage firm have provided. Your prompt response will ensure that your ordinary shares of Trinseo shareholder asPLC are represented at the Annual Meeting. You can change your vote and revoke your proxy by following the procedures described in this proxy statement.
By Order of the closeBoard of business on April 14, 2016, or hold a valid proxy for the Annual General Meeting from such a shareholder. | | |
| | By Order of the Board of Directors |
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| | Angelo N. Chaclas
Senior Vice President, Chief Legal Officer and
Corporate Secretary |
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May X, 2016 |
![[MISSING IMAGE: sg_angelonchaclas-bw.jpg]](/files/PRE 14A/0001104659-23-048364/sg_angelonchaclas-bw.jpg)
Angelo N. Chaclas
Senior Vice President, Chief Legal Officer,
Chief Compliance Officer and Corporate Secretary
[ ], 2023
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting To Be Held on June
21, 2016: Our14, 2023: our proxy statement is attached. Financial and other information concerning Trinseo is contained in our Annual Report to shareholders for the fiscal year ended December 31,
2015.2022. The proxy statement and our fiscal
20152022 Annual Report to shareholders are available on the Investor Relations section of our website at
www.investor.trinseo.com.investor.trinseo.com. Additionally, you may access our proxy materials at
www.proxyvote.com,proxyvote.com, a site that does not have
"cookies"“cookies” that identify visitors to the site.
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TABLE OF CONTENTS
Proxy Statement
The Board of
Directors (the "Board") of Trinseo. S.A.Trinseo PLC solicits your proxy for the
2016 Annual
General Meeting
of Shareholders (the "General Meeting") to be held on June
21, 201614, 2023, and at any adjournments or postponements of the
GeneralAnnual Meeting, for the purposes set forth in the Notice of the Annual
General Meeting of Shareholders included in this proxy statement. As used in this
Proxy Statement,proxy statement, the terms
"we," "us," "our" "Company"“we,” “us,” “our” “Company” or
"Trinseo"“Trinseo” refer to Trinseo
S.A.PLC. Proxy materials, including this
Proxy Statementproxy statement and the Annual Report for our fiscal year ended December 31,
2015 ("2022 (“fiscal
2015"2022”) are being first provided to shareholders on or about May
[X], 2016.1, 2023. Our
registered address is
4 rue Lou Hemmer, L-1748 Luxembourg, Grand Duchy of Luxembourg.Riverside One, Sir John Rogerson’s Quay, Dublin 2, Dublin, Ireland, D02 X576.
1 ![[MISSING IMAGE: lg_trinseotmfooter-4c.jpg]](/files/PRE 14A/0001104659-23-048364/lg_trinseotmfooter-4c.jpg)
2023 Proxy Statement
TABLE OF CONTENTSQUESTIONS AND ANSWERS ABOUT THE GENERAL MEETING AND THE PROXY MATERIALSWhere is
Questions and Answers about the annual meeting?Annual Meeting and the Proxy Materials
Questions and Answers about the Annual Meeting and the Proxy Materials
When and where will the Annual Meeting be held?
We will hold the GeneralAnnual Meeting at 11:0030 a.m., local timeIrish Standard Time, on Tuesday,Wednesday, June 21, 201614, 2022 at the Sofitel Luxembourg Europe hotelInterContinental Dublin, located at 4, rue du Fort Niedergrünewald, BP 512 / Quartier Européen Nord, L-2015 Luxembourg, Grand DuchySimmonscourt Road, Ballsbridge, Dublin, D04 A9K8.
Beneficial shareholders who held their shares through a broker, bank or other nominee on the record date for the Annual Meeting, who wish to attend the Annual Meeting, must register by going to the Company’s voting website, proxyvote.com, entering their 16-digit control number found on their proxy card or in their Annual Meeting materials, and clicking on the box labeled “Register for Meeting.” Shareholders of Luxembourg. When you arriverecord, who hold their shares through the Company’s transfer agent, and who wish to attend the Annual Meeting are also encouraged to register to attend on proxyvote.com.
In the event it is not possible or advisable to hold the Annual Meeting in person due to unforeseen events, we will announce alternative arrangements for participation at the meeting. Details will be posted in the lobby, check“Investor Relations” section of our website, investor.trinseo.com, and filed with the Securities and Exchange Commission in atadvance of the front desk and ask to be directed to the Trinseo GeneralAnnual Meeting. We reserve the right to request that you to present a photo ID and verify your status as a shareholder. We will not permit cameras or other recording devices at the General Meeting. All cell phones must be turned off once the General Meeting is convened. Why did I receive a notice in the mail regarding Internet availability of proxy materials instead of a full set of proxy materials? We provide access to our proxy materials over the Internet. On or about May [X], 20161, 2023 we mailedwill commence mailing of a Notice of Internet Availability of Proxy Materials to our shareholders of record and beneficial owners. The Notice explains how to access the proxy materials on the Internet and how to vote your proxy. proxy for the Annual Meeting.
If you received athe Notice by mail and would like to receive a printed copy of our proxy materials, please follow the instructions for requesting printed materials included in the Notice. What will shareholders vote on at the annual meeting?Annual Meeting?
Shareholders will be asked to vote: 1.
To elect, three Class IIby separate resolutions, eleven (11) directors specifically named in the proxy statement, each to serve for a term of three years.
2.To ratify the Board's appointment of Stephen F. Thomas as director of the Board to fill a vacancy in Class III, with a remaining term of one year;
3.To ratify the Company's directors' compensation program;
4.
2.
To approve, on an advisory basis, of the compensation paid by the Company to its named executive officers (the "say-on-pay vote");
5.To approve the Company's annual accounts prepared in accordance with accounting principles generally accepted in Luxembourg ("Luxembourg GAAP") for the year ended December 31, 2015 (the "Luxembourg Annual Accounts") and its consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") including a footnote reconciliation of equity and net income to International Financial Reporting Standards ("IFRS") for the year ended December 31, 2015 (the "Consolidated Accounts") (together, the "Luxembourg Statutory Accounts");
6.To approve the allocation of the results of the year ended December 31, 2015;officers;
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7.To approve the granting and discharge of the Company's directors and auditor for the performance of their respective duties during the year ended December 31, 2015;
8.3.
To ratify, the appointment of PricewaterhouseCoopers Société cooperative ("PwC Luxembourg") to be the Company's independent auditor for all statutory accounts required by Luxembourg law for the year ended December 31, 2016;
9.To ratifynon-binding advisory vote, the appointment of PricewaterhouseCoopers LLP ("PwC") to beas the Company'sCompany’s independent registered public accounting firm for the year endedending December 31, 2106;
10.To2023 and to authorize, by binding vote, the Audit Committee of the Board to make repayments of equity at times and in amounts set byits auditors’ remuneration;
4.
To approve a proposal to grant the Board in its discretion and withinauthority to issue shares under Irish law;
5.
To approve a proposal to grant the limitsBoard authority to opt out of Luxembourgstatutory pre-emption rights under Irish law; and
11.
6.
To authorizeset the repurchase upprice range for the Company’s re-issuance of treasury shares;
7.
To approve an amendment to 4.5 million of the Company's ordinary shares overCompany’s Omnibus Incentive Plan;
8.
To approve transacting any other business that may properly come before the next two (2) years.Annual Meeting.
We do not expect any other matters to be presented at the meeting.Annual Meeting. If other matters are properly presented for voting, the persons named as proxies will vote in accordance with their best judgment on those matters. Who is entitled to vote at the annual meeting?Annual Meeting?
Shareholders of record as of the close of business on April 14, 201620, 2023 are entitled to vote at the meeting.Annual Meeting. On that date, there were 47,177,934[ ] of our ordinary shares outstanding. Each ordinary share is entitled to one vote. Under our articles of association, the holders of a majority of the ordinary shares outstanding and entitled to vote at the General Meeting shall constitute a quorum for the transaction of business at the General Meeting. Ordinary shares represented in person or by proxy will be counted for purposes of determining whether a quorum is present. Abstentions and broker non-votes (if any) will be treated as present at the General Meeting and will be counted for quorum purposes. What is a shareholder of record? If your shares are registered directly in your name with our transfer agent, American Stock Transfer &Computershare Trust Company, LLC,N.A., you are considered the shareholder of record for those shares. As the shareholder of record, you have the right to vote your shares. If your shares are held in a stock brokerage account or by a bank, or other holder of record, you are considered the beneficial owner of shares held in street name. Your broker, bank, or other holder of record is the shareholder of record for those shares. As the `beneficialbeneficial owner, you have the right to direct your broker, bank, or other holder of record on how to vote your shares. What constitutes a quorum for consideration of proposals at the Annual Meeting?
Under our Constitution, the holders of a majority of the ordinary shares outstanding and entitled to vote at the Annual Meeting shall constitute a quorum for the transaction of business at the Annual Meeting. Ordinary shares represented in person or by proxy will be counted for purposes of determining whether a quorum is present. Abstentions and broker non-votes (if any) will be treated as present at the Annual Meeting and will be counted for quorum purposes.
How many votes are required to elect directors and to adopt proposals? Eachthe other proposals at the Annual Meeting?
The proposals related to the special resolutions to grant the Board authority to opt out of statutory pre-emption rights under Irish law (Proposal 5), and to set the price range for the re-issuance of treasury shares (Proposal 6) require the affirmative vote of three-quarters of the votes cast in person or by proxy at the Annual Meeting. The election of directors and each of the other proposals to be voted onare ordinary resolutions and require the affirmative vote of a majority of the ordinary shares representedvotes cast in person or by proxy at the GeneralAnnual Meeting and entitled to vote. Aon each resolution. Advisory votes are deemed approved if passed by a majority of the shares entitled to vote on a matter, whether presentvotes cast in person or by proxy on the
2023 Proxy Statement 2
Questions and Answers about the Annual Meeting and the Proxy Materials
resolution at the Annual Meeting, and the Board takes the voting results under advisement.
| Voting Item | | | Votes Required to
Approve Proposal
(if quorum is
present) | | | Abstentions and
Broker Non-Votes | |
| 1. Election of Directors | | | Majority of Votes Cast. Votes cast “for” must exceed the votes cast “against” | | | Not counted as votes cast and therefore have no effect | |
| 2. Approval of Executive Compensation | | | Majority of Votes Cast. Proposal is deemed approved if votes “for” exceed votes cast “against.” The Board takes the voting results under advisement | | | Not counted as votes cast and therefore have no effect | |
| 3. Appointment of PwC as independent registered public accounting firm and authorization of the Audit Committee to set auditors’ remuneration | | | Majority of Votes Cast. Votes cast “for” must exceed the votes cast “against”. The Board takes the voting results with respect to the appointment of PwC under advisement | | | Abstentions are not counted as votes cast and therefore have no effect; brokers may vote without instruction | |
| 4. Approval of Board Authority to Issue Shares | | | Majority of Votes Cast. Votes cast “for” must exceed the votes cast “against” | | | Not counted as votes cast and therefore have no effect | |
| 5. Approval of Board Authority to Opt Out of Statutory Pre-emption Rights | | | 75% of the Votes Cast: Votes cast “for” must meet or exceed 75% of total votes cast | | | Not counted as votes cast and therefore have no effect | |
| 6. To set the price range for re-issuance of treasury shares | | | 75% of the Votes Cast: Votes cast “for” must meet or exceed 75% of total votes cast | | | Not counted as votes cast and therefore have no effect | |
| 7. Approval of amendment to our Omnibus Incentive Plan | | | Majority of Votes Cast. Votes cast “for” must exceed the votes cast “against” | | | Not counted as votes cast and therefore have no effect | |
What happens if I abstain from voting on a matter, or my broker withholds my vote?
For all proposals, Irish law provides that ordinary shares represented at the meeting and abstaining from voting will constitutecount as shares present at the meeting for the purpose of determining whether there is a quorum, but will not count for considerationthe purpose of that matter atdetermining the General Meeting.How manynumber of votes am I entitledcast.
A broker non-vote occurs when a broker does not have discretion to
per share? Each ordinary share that you own represents one vote. If you dovote on a particular non-routine proposal and the broker has not received instructions from their customers as to how to vote on such proposal. Such broker non-votes are not considered as votes
cast on such non-routine proposal, which has the effect of reducing the number of affirmative votes needed to approve the proposal. Brokers are not permitted to vote your shares you will not have a say on any matter other than Proposal 3 (Ratification of the important issuesAppointment of the Independent Registered Public Accounting Firm and Authorization of the Audit Committee of the Board to be voted upon at the General Meeting.Set Auditors’ Remuneration).
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How do I vote?
If you are a shareholder of record, you may vote in person atyour shares during the meeting.Annual Meeting. If you do not wish to vote in personduring the meeting or if you will not be attending the meeting,Annual Meeting, you may vote by telephone, or over the Internet, by following the instructions provided in the Notice of Internet Availability of Proxy Materials. If you requested a printed copy of the proxy materials, you may also complete, sign, and date your proxy card and return it in the prepaid envelope that was included with the printed materials. Beneficial shareholders who held their shares through a broker, bank or other nominee on the record date, who wish to vote their shares by proxy during the Annual Meeting must obtain a legal proxy, executed in their favor, from their broker, bank or other nominee.
If you are a beneficial owner of sharesholder and you wish to vote in person at the meeting, you must obtain a proxy from your broker, bank, or other shareholder of record and present it to the inspector of election with your ballot. If you do not wish to vote in person or will not be attendingduring the meeting, you may vote by following the instructions provided in the Notice of Internet Availability of Proxy Materials you received from the shareholder of record of your shares. If you receivedrequested a printed copy of the proxy materials, you should have received a proxyvoting instruction card and voting instructions from the shareholder of record of your shares. If you are a shareholder of record and submit a signed proxy card for the Annual Meeting but do not fill out the voting instructions, the persons named as proxy holders will vote the shares represented by your proxy "FOR"as follows: (1) “FOR” the authorizationelection of eleven (11) directors specifically named in the Company, with approval of the Board,proxy statement, each to (1) elect Christopher D. Pappas, Stephen M. Zide and Felix S. Hauser as directors, eachserve for a term of three years;one year expiring at the 2024 annual general meeting; (2) to ratify“FOR” the Board's appointment of Stephen F. Thomas to fill a vacancy in Class III, with a remaining term of one year; (3) ratify the Company's directors' compensation program; (4) approve, on anproposal regarding advisory basis,approval of the compensation paid by the Company to its named executive officers; (5) approve the Luxembourg Statutory Accounts; (6) approve the allocation(3) “FOR” ratification of the results of the year ended December 31, 2015; (7) approve the granting and discharge of the Company's directors and auditor for the performance of their respective duties during the year ended December 31, 2015; (8) ratify the appointment of PwC Luxembourg to be the Company's independent auditor for the year ended December 31, 2016 for all statutory accounts as required by Luxembourg law for the same period; (9) ratify the appointment of PwC to be the Company'sCompany’s independent registered public accounting firm for the year endedending December 31, 2016; (10) authorize2023, and authorization of the Audit Committee of the Board to make repaymentsset the auditors’ remuneration; (4) “FOR” approval of equity at times and in amounts set by the Board in its discretion and within the limitsauthority to issue shares under Irish law; (5) “FOR” approval of Luxembourg law; and (11) authorize the repurchase by the CompanyBoard authority to opt out of statutory pre-emption rights, with respect to up to 4.5 million10% of its outstandingissued ordinary shares over the next two (2) years. If there are not sufficient votes to approve one or moreshare capital, under Irish law; (6) “FOR” approval of the Proposals atprice range for re-issuing treasury shares; and (7) “FOR” approval of an amendment to the General Meeting, in accordance with the Company's articles of association, the chairman may adjourn the General Meeting to permit the further solicitation of proxies. Additionally, under Luxembourg law, the Board may adjourn the General Meeting for up to four weeks. The persons named as proxies will vote those proxies for such adjournment, unless marked to be voted against the Proposal, to permit the further solicitation of proxies. Abstentions and broker non-votes, if any, will not have any effect on the result of the vote for adjournment. If any nominee should become unavailable, your shares will be voted for another nominee selected by the Board or for only the remaining nominees.
Brokers are not permitted to vote your shares on any matter other than Proposal 9 (Ratification of the Appointment of the Independent Registered Public Accounting Firm). Company’s Amended & Restated 2014 Omnibus Incentive Plan.
If your shares are held in the name of a broker or nominee and you do not instruct the broker or nominee how to vote with respect to the election of directors or if you abstain or withhold authority to vote on any matter, your shares will not be counted as having been voted on those matters, but will be counted as in attendance at the meeting for purposes of a quorum.What happens if I abstain from voting If you do not vote your shares, you will not have a say on a matter or my broker withholds my vote?
For each matterthe important issues to be consideredvoted upon at the meeting, abstentions are treated as shares that are represented and entitled to vote, so abstaining has the same effect as a negative vote. Shares held by brokers that do not have discretionary authority to vote on a particular proposal and that have not
Annual Meeting.
Table of Contents
received voting instructions from their customers are not counted as being represented or entitled to vote on the proposal, which has the effect of reducing the number of affirmative votes needed to approve the proposal.
Should I submit a proxy even if I plan to attend the GeneralAnnual Meeting?
To ensure that your vote is recorded promptly, please vote as soon as possible, even if you plan to attend the General Meeting in person.Annual Meeting. If you attend
3 2023 Proxy Statement
Questions and Answers about the GeneralAnnual Meeting and the Proxy Materials
are a shareholder of record and plan to attend the Annual Meeting, you may also submit your vote in person,during the meeting, and any previous votes that you submitted will be superseded by the vote that you cast atduring the GeneralAnnual Meeting. Internet and phone voting will be cut-offcut off at 11:59 p.m., Eastern Time, on Monday, June 19, 2016.12, 2023.
Can I revoke my proxy? Your
If you are a shareholder of record, meaning your shares are registered directly in your name with our transfer agent, Computershare Trust Company, N.A., as of the record date for the Annual Meeting (and not in the name of a bank, broker or other nominee), then your proxy may be revoked by taking any of the following actions:
•
by giving notice of revocation to Trinseoour Corporate Secretary in writing c/o Trinseo PLC, Riverside One, Sir John Rogerson’s Quay, Dublin 2, Dublin, D02 X576, Ireland (Attention: Corporate Secretary), which notice must be received before the commencement of the Annual Meeting;
•
by executing and mailing to the Company a later-dated proxy, to be received no later than 11:59 p.m., Eastern Time, on Monday, June 12, 2023;
•
by accessing the Internet site or by using the toll-free telephone number (in each case by no later than 11:59 p.m., Eastern Time, on Monday, June 12, 2023), or
•
if you attend the Annual Meeting in person, atby submitting a new poll card during the GeneralAnnual Meeting. A shareholder
Beneficial holders who hold their shares through a bank, broker or other nominee may alsorevoke their proxy or change his or hertheir vote by executing and returning to the Company a later-dated proxy, by submitting a later-dated electronic vote through the Internet site or by using the toll-free telephone number or in person at the General Meeting.(in each case by no later than 11:59 p.m., Eastern Time, on Monday, June 12, 2023).
The Internet and telephone procedures for voting and for revoking or changing a vote are designed to authenticate shareholders'shareholders’ identities, to allow shareholders to give their voting instructions and to confirm that shareholders'shareholders’ instructions have been properly recorded. Who will bear the cost of soliciting votes for the annual meeting?Annual Meeting?
We will bear the expense of the solicitation of proxies for the GeneralAnnual Meeting. Solicitation of proxies may be made by mail, in person or telephone by officers, directors and other employees of the Company and by employeesCompany. We have engaged Okapi Partners LLC to aid in the solicitation of Broadridge Financial Solutions, Inc. ("Broadridge"). proxies.
We will reimburse Broadridge and the Company'sCompany’s banks, brokers, and other custodians, nominees and fiduciaries for their reasonable costs in the preparation and mailing of proxy materials to shareholders. A shareholder may also choose to vote electronically by accessing the Internet site stated on the Notice of Internet Availability or by using the toll-free telephone number stated on the Notice of Internet Availability. Shareholders that vote through the Internet should understand that there may be costs associated with electronic access, such as usage charges from Internet access providers and telephone companies, which will be borne by the shareholder.
2023 Proxy Statement 4
Proposal 1—Election of Contents
PROPOSAL 1
ELECTION OF DIRECTORS
Trinseo has a classified boardDirectors
Trinseo’s Board currently consists of directors currently consisting of threethirteen directors with one-year terms expiring in 2016 (Class II), three2023. In April 2023, we announced that Donald Misheff and Philip Martens would not stand for reelection to the Board in 2023. Therefore, following the Meeting, Trinseo’s Board will be resized to eleven directors with terms expiring in 2017 (Class III) and threethe Board will reevaluate its committee membership and chairs.
Each of the directors
with terms expiring in 2018 (Class I). At each annual general meeting of shareholders, directors in one class are elected for
a fullan annual term
to serve until close of
three years to succeed those directors whose terms are expiring. This year, the three Class II director nominees will stand for election to a three-year term expiringbusiness at the 2019next annual general meeting. The persons named in the enclosed proxy will vote to elect Christopher D. Pappas, Stephen M. ZideK’Lynne Johnson, Joseph Alvarado, Frank Bozich, Victoria Brifo, Jeffrey Cote, Pierre-Marie De Leener, Jeanmarie Desmond, Matthew Farrell, Sandra Beach Lin, Henri Steinmetz and Felix S. HauserMark Tomkins as directors unless the Proxy is marked otherwise. Each of the nominees has indicated his or her willingness to serve, if elected. However, if a nominee should be unable to serve, the ordinary shares
represented by proxies may be voted for a substitute nominee designated by the Board. Management has no reason to believe that any of the above-mentioned persons will not serve his or her term as a director. 2023 Director Nominees
The individuals listed below have been nominated and are standing for election at this year’s Annual Meeting. If elected, they will hold office until our 2024 annual general meeting of shareholders and until their successors are duly elected and qualified. Each of the nominees in this proposal was previously elected to the Board by shareholders. Each of the nominees will cease to be directors if their respective appointments are not approved by a majority of the votes cast by our shareholders.
Director Nominee Skills
The following table highlights certain skills, knowledge and experience held by each current Director nominee. A particular Director may possess other skills, knowledge or experience even though they are not indicated below.
| | Director Nominee | | | Served
Since | | | Chemicals
Industry
Experience | | | Manufacturing/
Related Industry
Experience | | | Chief
Executive
Experience | | | Accounting
and Financial
Experience | | | Public
Company
Board
Experience | |
| | K’Lynne Johnson | | | | | 2017 | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | | | | | | | ✓ | | |
| | Joseph Alvarado | | | | | 2017 | | | | | | | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | |
| | Frank Bozich | | | | | 2019 | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | | | | | | | ✓ | | |
| | Victoria Brifo | | | | | 2021 | | | | | | ✓ | | | | | | ✓ | | | | | | | | | | | | | | | | | | | | |
| | Jeffrey J. Cote | | | | | 2014 | | | | | | | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | |
| | Pierre-Marie De Leener | | | | | 2014 | | | | | | ✓ | | | | | | | | | | | | ✓ | | | | | | ✓ | | | | | | | | |
| | Jeanmarie Desmond | | | | | 2020 | | | | | | ✓ | | | | | | ✓ | | | | | | | | | | | | ✓ | | | | | | | | |
| | Matthew Farrell | | | | | 2020 | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | |
| | Sandra Beach Lin | | | | | 2019 | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | | | | | | | ✓ | | |
| | Henri Steinmetz | | | | | 2017 | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | | | | | | | | | |
| | Mark Tomkins | | | | | 2019 | | | | | | ✓ | | | | | | ✓ | | | | | | | | | | | | ✓ | | | | | | ✓ | | |
Board Commitment to Diversity
We seek nominees
from diverse backgrounds with established strong professional reputations, sophistication, business acumen and experience in the global materials, chemical and related
manufacturing industries. We also seek nominees with experience in substantive areas that are important to our business such as
chemical industry expertise; international operations; accounting, finance and capital structure; strategic planning and
operational leadership of complex
organizations;organizations human resources and development practices; and
strategy and innovation.
Our nominees hold or have held senior executive positions in large, complex organizations or in businesses related to important substantive areas, and in these positions have also gained experience in core management skills and substantive areas relevant to our business. Our nominees also have experience serving on boards of directors and board committees of other organizations, and each ofIn addition, we believe that our nominees
has an understanding of public company corporate governance practices and trends. In addition, all of our nominees have prior service on our Board, which has provided them with significant exposure to both our business and the industry in which we compete. We believe that all our nomineesshould possess the professional and personal
qualifications necessary for board service, and we have highlighted particularly noteworthy attributes in each of the biographies of our directors and our nominees below. Thirty-six percent (36%) of our director nominees are women, and two of our nominees self-identify as a member of an underrepresented minority group (meaning an individual who self-identifies as Black or African American, Hispanic or Latinx, Asian, Native American or Alaska Native, Native Hawaiian or Pacific Islander). Two of our nominees are non-U.S. citizens and two maintain dual citizenship. On average the term of service of our director nominees is approximately four (4) years, and more than half of our nominees have served on the Board for less than five years.
5 2023 Proxy Statement
The election of each director requires the approval of a majority of the shares represented in their individual biographies below.Nominees for Election for Terms Expiring in 2016 (Class II Directors)
The individuals listed belowperson or by proxy at the Annual Meeting. Broker non-votes will have been nominated and are standing for election atno effect on the outcome of this year's annual General Meeting. If elected, they will hold office until our 2019 annual general meeting of shareholders and until their successors are duly elected and qualified. All of these directors were previously elected to the Board by shareholders.
YOURproposal.
| | | THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR”
THE ELECTION OF EACH OF THE NOMINEES AS DIRECTOR. | | |
2023 Proxy Statement 6
2023 Director since October 2010. Mr. Pappas joined the CompanyNominees
| | | | | K’lynne Johnson Age: 54 Director Since: March 2017 Committee Membership: •
Compensation and Talent Development •
Nominating & Corporate Governance | |
Professional Experience:
Ms. Johnson served as President and Chief Executive Officer of Elevance Renewable Sciences Inc., a specialty chemicals company, from 2007 to 2015, and as Chairwoman from 2015 to 2016. Ms. Johnson joined Elevance after over 20 years’ experience working within the oil and petrochemicals industry for Amoco Corporation and BP p.l.c. (joining BP after its merger with Amoco in June 2010. 1998). During this time she held both operational and functional roles, culminating in her role as Senior Vice President of Global Derivatives within BP’s global Innovene business, which included P&L accountability for multiple global commodity and specialty chemicals businesses. Ms. Johnson also served as director of TPC Group, a manufacturer of products derived from petrochemical raw materials, from 2011 to 2012 before the company was taken private.
Education:
Ms. Johnson graduated from Brigham Young University with a degree in Management and Organizational Behavior (M.O.B.) and a B.S. in Psychology.
Other Public Company Directorships:
Current Directorships—
FMC Corporation (NYSE: FMC) since 2013
Director Qualifications:
Ms. Johnson brings to our Board valuable experience in operational leadership and chemical industry and technological expertise.
7 2023 Proxy Statement
| | | | | Joseph Alvarado Age: 70 Director Since: March 2017 Committee Membership: •
Compensation and Talent Development (Chair) •
Nominating & Corporate Governance | |
Professional Experience:
Mr. Pappas has also been servingAlvarado served as our interim chief financial officer since November 2015. Prior to joining theChief Executive Officer of Commercial Metals Company Mr. Pappas held(NYSE: CMC), a numberglobal manufacturer, recycler and marketer of executive positions at NOVA Chemicalssteel and other metals, from September 2011 until September 2017, and as chairman of increasing responsibilityCMC’s Board of Directors from July 2000 to November 2009, most recentlyJanuary 2013 until January 2018. He joined CMC in April 2010 as Executive Vice President and Chief Operating Officer, was named President and Chief Operating Officer in April 2011, and became President and Chief Executive Officer from May 2009in September 2011 until his retirement. Prior to November 2009, President & Chief Operations Officer from October 2006 to April 2009 and Vicejoining CMC, he was President and Chief Operating Officer of Lone Star Technologies, Inc. from 2004 to 2007. In June 2007, following the acquisition of Lone Star Technologies, Inc. by United States Steel Corporation, Mr. Alvarado was named President of Styrenics from July 2000 to September 2006. Before joining NOVA Chemicals,U.S. Steel Tubular Products, Inc., a division of United States Steel Corporation, a position he held until March 2009. Mr. Pappas was Commercial Vice President of DuPont Dow Elastomers where he joined as Vice President of ethylene elastomers in 1995. Mr. PappasAlvarado began his chemicals career at Inland Steel Company in 19781976 and spent 21 years with Dow where he held various salesthe company in roles of increasing responsibility. He then served in executive roles with Birmingham Steel Corporation and managerial positionsIspat North America Inc. until 1995. joining Lone Star Technologies.
Education:
Mr. Pappas is currently a member of the Board of Directors of FirstEnergy Corp. (NYSE: FE) and Univar, Inc. (NYSE: UNVR), and he is a former member of the board of directors of Allegheny Energy, NOVA Chemicals, and Methanex Corporation.
Table of Contents
Mr. Pappas holds a B.S. degree in Civil Engineering from the Georgia Institute of Technology andAlvarado has an MBA from the Wharton School of Business at TheCornell University of Pennsylvania. Mr. Pappas is highly qualified to serve on the board of directors by his more than 30 years of management experience with major companies in the chemical industry, by his previous service as a director of the corporations noted above, and by his leadership of the Company since its formation. In these roles he has also acquired and demonstrated substantial financial expertise which is valuable to the Company's Board.
Stephen M. Zide, 56—Director and Chairman since June 2010. Mr. Zide is a senior advisor to Bain Capital in the private equity business, having joined the firm in 1997. From 2001 through 2015, Mr. Zide was a Managing Director of Bain Capital. Prior to joining Bain Capital, Mr. Zide was a partner of the law firm of Kirkland & Ellis LLP, where he was a founding member of the New York office and specialized in representing private equity and venture capital firms. Mr. Zide received an MBA from Harvard Business School, a Juris Doctorate from Boston University School of Law, and a B.A. degree in Economics from University of Notre Dame.
Other Public Company Directorships:
Current Directorships—
Kennametal Inc. (NYSE: KMT) since January 2018
Arcosa, Inc. (NYSE: ACA) since November 2018
PNC Financial Services Group Inc. (NYSE: PNC) since January 2019
Director Qualifications:
Mr. Alvarado brings years of experience in a cyclical commodities-driven industry and significant perspective on global manufacturing operations and strategic planning.
2023 Proxy Statement 8
| | | | | Frank A. Bozich Age: 62 Director Since: June 2019 Committee Membership: •
Environmental, Health, Safety, Sustainability & Public Policy | |
Professional Experience:
Mr. Bozich became the Company’s President and Chief Executive Officer in March 2019. From May 2013 until February 2019, Mr. Bozich had been the President and Chief Executive Officer at the SI Group, Inc., a leading global developer and manufacturer of phenolic resins and chemicals used in the production of antioxidants, engineering plastics, fuels and lubes, rubber and pharmaceutical ingredients. Prior to SI Group Inc., Mr. Bozich held several executive management positions at BASF Corporation, a multi-national chemicals and manufacturing corporation, including President of BASF’s Catalysts Division from 2010 to 2013, Group Vice President of Precious and Base Metal Service, and Group Vice President of the Integration Management Office. Prior to BASF, Mr. Bozich was Group Vice President, Enterprise Technologies and Ventures at Engelhard Corporation, which was acquired by BASF in 2006. He has also held leadership positions at Rohm and Haas; Croda Adhesives, Inc.; and Apex Adhesives, which he founded in 1986.
Education:
Mr. Bozich holds a bachelor’s degree in Chemistry and a master’s degree in Business Administration from the University of Rochester. He also servesChicago, as well as a director of Sensata Technologies B.V., Consolidated Container Corporation, and TI Automotive. Mr. Zide was a director of HD Supply Holdings, Inc. (NASDAQ: HDS) from 2007 through 2014 and Innophos Holdings, Inc. (NASDAQ: IPHS) from 2004 through 2013. Mr. Zide's significant experience serving on public and private company boards puts himmaster’s degree in a position to provide important contributions to our Board and leadership as Chairman of the Board of Directors. Felix Hauser, 40—Director since February 2016. Mr. Hauser is a Managing Director in Bain Capital's Munich Office and joined Bain Capital in 2005. Prior to joining Bain Capital, Mr. Hauser was a consultant at McKinsey & Company, where he worked in corporate finance and the consumer products and financial services industries. He currently serves on the board of directors of FTE Automotive. Mr. Hauser received an MBA with distinction from INSEAD and an MScChemistry from the University of Passau. Mr. Hauser brings to our Board significant capital markets experience and knowledge of European markets.
Directors with Terms Expiring in 2017 (Class III Directors)
Donald T. Misheff, 59—DirectorIllinois.
Other Public Company Directorships:
Current Directorships—
OGE Energy Corp (NYSE: OGE) since February 2015. 2016
Director Qualifications:
Mr. Misheff servedBozich is an accomplished CEO known for his strong personal leadership and track record of driving business growth and corporate transformation. His breadth of experience in leading chemical businesses in diverse and dynamic global markets is well-suited for the Company’s strategic priorities.
9 2023 Proxy Statement
| | | | | Victoria Brifo Age: 54 Director Since: June 2021 Committee Membership: •
Compensation and Talent Development •
Environmental, Health, Safety, Sustainability & Public Policy | |
Image courtesy of Air Products and Chemicals, Inc.
Professional Experience:
Victoria Brifo is Senior Vice President and Chief Human Resources Officer at Air Products and Chemicals, Inc. (NYSE: APD). She is responsible for leading all aspects of the company’s Human Resources (HR) organization, including HR Operations, Diversity and Inclusion, Talent Management, and Compensation and Benefits, as managing partner from 2003 until his retirementwell as Global Health and Wellness, and Corporate Aviation and Corporate Transportation. Ms. Brifo has been with Air Products since 2001, starting as a production site leader and progressing through several plant leadership positions before becoming Global Diversity Director in 2005. In 2008 she was named Global Manager of Electronics Operations and moved to the Merchant Gases group in 2011 to lead the Global Generated Gases business. In 2014 Ms. Brifo assumed the role of the Northeast Ohio offices of Ernst & Young LLP, a public accounting firm. As the managing partner of the Northeast Ohio offices of Ernst & Young LLP, Mr. Misheff advised many of the region's largest companies on financialGlobal Transformation Leader for Industrial Gases. She was subsequently appointed Vice President, Global Gases, followed by Vice President, Equipment Sales, Plant Support and corporate governance issues. He began his career with Ernst & Young LLP in 1978 as part of the audit staff and later joined the tax practice, specializing in accounting/financial reporting for income taxes, purchase accounting, and mergers and acquisitions. He has more than 30 years of experience performing, reviewing, and overseeing the audits of financial statements of a wide range of public companies. He currently serves as a director of three other public companies of Aleris Corporation (NYSE: ALRS), TimkenSteel Corporation (NYSE: TMST) and First Energy Corp. (NYSE: FE) Mr. Misheff graduated from the University of Akron with a B.S. degree in Accounting and is a certified public accountant. Mr. Misheff brings extensive financial and corporate governance experience to our Board. Stephen F. Thomas, 41—Director since September 2015. Mr. Thomas is a Managing Director at Bain Capital, where he has worked since 2007.Central Procurement. Prior to joining Bain Capital, he was a ManagerAir Products, Ms. Brifo worked at Bain &LyondellBasell and Amoco Production Company.
Education:
Ms. Brifo holds degrees in chemical engineering and political science from the Massachusetts Institute of Technology.
Other Public Company where he consulted forDirectorships:
None
Director Qualifications:
Ms. Brifo brings significant experience in the media, telecom, consumer, financial services,chemicals and private equity industries. Mr. Thomas received an MBA from Harvard Business Schoolmanufacturing industry, as well as leadership, management and graduated cum laude with an A.B. degree in Economics from Princeton University. He also currently serves as a director of TI Automotive and Big Tex Trailers, Inc. Mr. Thomas was previously onhuman resources expertise to our board of directors from May 2014 through February 2015. Mr. Thomas brings to the Board significant knowledge and expertise in strategy and operations gained from his experiences as a strategy consultant and as a Managing Director of Bain Capital.directors.
2023 Proxy Statement 10
TABLE OF CONTENTSTable of Contents
Aurélien Vasseur, 39—Director since May 2014. Mr. Vasseur joined Bain Capital Luxembourg S.à r.l. in 2011 and is a corporate manager of the firm. Before joining Bain Capital, Mr. Vasseur was a finance auditor at Ernst and Young, Luxembourg. Mr. Vasseur currently serves as a member of the board of directors for Atento Floatco S.A., Magnolia (BC) S.A., and Atento Luxco
PROPOSAL 1 S.A. Mr. Vasseur received a master's degree in management from the Ecole des Hautes Etudes Commerciales (Edhec Business School). Mr. Vasseur brings to our Board expertise in finance and governance experience serving as a director of other Luxembourg-based companies.Directors with Terms Expiring in 2018 (Class I Directors)
Jeffrey J. Cote, 49—Director since May 2014.
| | | | | Jeffrey J. Cote Age: 56 Director Since: May 2014 Committee Membership: •
Audit •
Environmental, Health, Safety, Sustainability & Public Policy | |
Professional Experience:
Mr. Cote has served as the Chief Executive Officer and President of Sensata Technologies Holding plc (NYSE: ST) since March 2020. Prior to his appointment as CEO, Mr. Cote served as President and as Chief Operating Officer of Sensata Technologies Holding N.V. (NYSE: ST) since July 2012 and as Executive Vice President of its Global Sensing Solutions business since November 2015. He joined Sensata as Senior Vice President and Chief Financial Officer in January 2007 and was appointed Executive Vice President in July 2007. From March 2005 to December 2006, Mr. Cote was Chief Operating Officer of the law firm Ropes & Gray. From January 2000 to March 2005, Mr. Cote was Chief Operating, Financial and Administrative Officer of Digitas. Previously he worked for Ernst & Young LLP from 1989 until 1997. Mr. Cote is a certified public accountant andaccountant.
Education:
Mr. Cote received a B.A. degree in Business Administration and a Master of Accounting from Florida Atlantic University.
Other Public Company Directorships:
Current Directorships—
Sensata Technologies Holding plc (NYSE: ST) since March 2020
Director Qualifications:
Mr. Cote brings significant management,
capital marketsfinancial and accounting experience to our Board.
Pierre-Marie De Leener, 58—Director since May 2014.
11 2023 Proxy Statement
| | | | | Pierre-Marie De Leener Age: 65 Director Since: May 2014 Committee Membership: •
Compensation and Talent Development •
Environmental, Health, Safety, Sustainability & Public Policy | |
Professional Experience:
Mr. De Leener has served as Chairman of the Board of the Flint Group since October 2014 and director of Savrola SA since 2013. Mr. De Leener previously served as interim CEO of Braas Monier Building Group SA sincefrom January 2016 Chairman of the Board of Directors of the Monier Holdings GP S.A. sinceto November 20132016 and as Chairman of the Advisoryits Board of the Flint Group since October 2014.Directors from June 2014 to March 2017. Prior to that, he served as Executive Vice President for PPG Industries, Inc. from July 2010 until December 2012. From June 2008 until August 2011, Mr. De Leener also served as President of PPG Europe S.A. Mr. De Leener previously servedand as Chief Executive Officer of SigmaKalon Group from 1998 until January 2008. In addition, Mr. De Leener served as a member of the Total Fina operating committee from 1998 until 2001. Mr. De Leener also served as the Chief Executive Officer of Fina Italiana SpA and of Fina Research from 1989 until 1995 and from 1995 until 1998, respectively.
Education:
Mr. De Leener received a B.A.B.S. degree in Economics and Philosophy and a MasterMasters of Chemical Engineering degree from Catholic University of Louvain, Belgium.
Other Public Company Directorships:
None
Director Qualifications:
Mr. De Leener brings valuable
executive management and chemical industry experience to our Board.
Michel G. Plantevin, 59—Director since June 2010. Mr. Plantevin
2023 Proxy Statement 12
| | | | | Jeanmarie Desmond Age: 56 Director Since: October 2020 Committee Membership: •
Audit •
Environmental, Health, Safety, Sustainability & Public Policy | |
Professional Experience:
Ms. Desmond is the former Executive Vice President and Chief Financial Officer of DuPont de Nemours, Inc. and has previously served as Vice President and Co-Controller for DowDuPont and as finance leader for the Specialty Products division following the merger of DuPont with Dow Chemical. Ms. Desmond served in various leadership roles within DuPont in her 30-year career with the company. She also serves on the board and is treasurer of Delaware Prosperity Partnership, a public-private partnership overseeing economic development in Delaware.
Education:
Ms. Desmond received a B.S. in Accounting from Mt. St. Mary’s University and is a Managing certified public accountant (inactive).
Other Public Company Directorships:
Current Directorships—
IPG Photogenics Corporation (Nasdaq: IPGP) since 2021
Sylvamo (NYSE: SLVM) since 2021
Director Qualifications:
Ms. Desmond brings substantial finance and accounting experience and extensive experience in the chemicals industry to our Board.
13 2023 Proxy Statement
| | | | | Matthew Farrell Age: 66 Director Since: November 2020 Committee Membership: •
Audit •
Compensation and Talent Development | |
Professional Experience:
Mr. Farrell is the Chairman, President and Chief Executive Officer of Bain Capital Europe, LLP.Church & Dwight Co. Inc. (“Church & Dwight”), serving as CEO since 2016 and as Chairman since 2019. Mr. Farrell served as Executive Vice President, Chief Financial Officer and Chief Operating Officer at Church & Dwight since 2014, and as Chief Financial Officer since 2006. Prior to that, Mr. Farrell served as Chief Financial Officer of Alpharma Inc., as Vice President, Investor Relations & Communications at Ingersoll-Rand Ltd., and in various senior financial positions at AlliedSignal Inc. Mr. Farrell began his career with KPMG Peat Marwick LLP, where he was an audit partner.
Education:
Mr. Farrell received a B.S. degree from Manhattan College and is a certified public accountant (inactive).
Other Public Company Directorships:
Current Directorships—
Church & Dwight Co. Inc. (NYSE: CHD) since 2019
Past Directorships—
Lydall Co., Inc. (NYSE: LDL) from 2003 to 2021
Director Qualifications:
Mr. Farrell brings to our Board his experience as a chief executive officer, substantial financial and audit expertise and experience in the chemicals, industrial goods and consumer products industries.
2023 Proxy Statement 14
| | | | | Sandra Beach Lin Age: 65 Director Since: November 2019 Committee Membership: •
Nominating & Corporate Governance •
Environmental, Health, Safety, Sustainability & Public Policy (Chair) | |
Professional Experience:
From 2010 to 2011, Ms. Beach Lin was President and Chief Executive Officer of Calisolar, Inc., a manufacturer of solar silicon and multicrystalline solar cells. Prior to joining Bain CapitalCalisolar, she was Executive Vice President, then Corporate Executive Vice President, at Celanese Corporation, a global technology and specialty materials company, from 2007 to 2010. Ms. Beach Lin joined Avery Dennison Corporation, a global leader in 2003, Mr. Plantevinpressure-sensitive adhesives technology as Group Vice President from 2005 to 2007. Prior to joining Avery Dennison, from 2002 to 2005 she was President, Alcoa Closure Systems International, a Managing division of Alcoa Incorporated, a global aluminum leader. From 1994 to 2001, Ms. Beach Lin held various executive positions at Honeywell International.
Education:
Ms. Beach Lin graduated with a BBA in General Management from the University of Toledo and has an MBA in Marketing and Policy and Control from the University of Michigan.
Other Public Company Directorships:
Current Directorships—
American Electric Power (NYSE: AEP) since 2012
Avient Corp. (NYSE: AVNT) since 2013
Past Directorships—
WESCO International (NYSE: WCC) from 2002 to 2019
Director of Goldman Sachs International in London, initiallyQualifications:
Ms. Beach Lin brings to our Board her experience as a chief executive officer and extensive experience in the Investment Banking division, then inglobal specialty chemicals industry.
15 2023 Proxy Statement
| | | | | Henri Steinmetz Age: 66 Director Since: November 2017 Committee Membership: •
Audit •
Environmental, Health, Safety, Sustainability & Public Policy | |
Professional Experience:
From 2016 to 2018, Mr. Steinmetz served as Chief Executive Officer of the Merchant Banking division (PIA).Ceramtec Group, a global supplier of advanced ceramics. From 2009 to 2016, Mr. Steinmetz was Executive Director and Chief Executive Officer of Ruetgers N.V., Europe’s leading manufacturer of chemical raw materials made from coal tar. Prior to Goldman Sachsjoining Ruetgers, Mr. Steinmetz was President of Sulzer Metco, a worldwide technology leader in coating materials, from 2004 to 2008, and was an Executive Vice President at Great Lakes Chemical Corporation from 2000 to 2004. Mr. Steinmetz currently serves as Chairman of Benteler International heAG.
Education:
Mr. Steinmetz graduated with a M.S. in metallurgy from the Technical University Clausthal, Germany and has an MBA from INSEAD Fontainebleau, France.
Other Public Company Directorships:
None
Director Qualifications:
Mr. Steinmetz brings significant global chief executive officer experience and decades of chemical industry experience to our Board.
2023 Proxy Statement 16
| | | | | Mark Tomkins Age: 67 Director Since: November 2019 Committee Membership: •
Audit (Chair) •
Nominating & Corporate Governance | |
Professional Experience:
From 2005 to 2006, Mr. Tomkins was Senior Vice President and Chief Financial Officer of Innovene, at the time, a consultant with Bain & Company in Londonleading petrochemical and later headed the Bain & Company Paris Officepolymers company. Prior to joining Innovene, Mr. Tomkins was Senior Vice President, Chief Financial Officer and Treasurer of Vulcan Materials, a building materials and chemical company, from 2001 to 2005. He joined Great Lakes Chemical Corp., a specialty chemicals company as a Managing Director. He also servesSenior Vice President and Chief Financial Officer from 1998 to 2001. Prior to Great Lakes Chemical, Mr. Tomkins was Vice President of Finance and Business Development for Polymers and Vice President of Finance and Business Development for Electronic Materials at Allied Signal (now Honeywell International). Mr. Tomkins’ previous experience includes service as a director of IMCD N.V.CVR Energy, Inc., Ibstock PLC,a publicly traded company primarily engaged in petroleum refining and Maisons du Monde. Mr. Plantevin also formerly servednitrogen fertilizer manufacturing, from 2007 to 2012, a as a director of Bravida AB, FCI SA and NXP Semiconductors N.V. Mr. Plantevin received an MBAWR Grace & Co., a publicly traded specialty chemicals company from Harvard Business School and an undergraduate and master's degree in Engineering from the Ecole Supérieure d' Electricité (Supélec) in France. Mr. Plantevin brings2006 to the Board expertise in business strategy and operational improvement gained from his extensive experience as a strategy consultant in the Paris and London offices of Bain & Company and then as a private equity professional. Mr. Plantevin has also had significant involvement with our Company since the Acquisition, and has served2021, as a director of numerousTerminix Global Holdings (formerly Service Master Holdings), a publicly traded home and commercial services business from 2015 to 2021, as well as a director of private companies in the energy and plastics sectors.
Education:
Mr. Tomkins graduated with a B.S. in Finance and Quantitative Management and an MBA from Eastern Illinois University, and is a certified public accountant (inactive).
Other Public Company Directorships:
Current Directorships—
None
Past Directorships—
Terminix Global Holdings (NYSE: TMX) from 2015 to 2021
WR Grace & Co. (NYSE: GRA) from 2006 to 2021
Director Qualifications:
Mr. Tomkins brings significant financial, accounting and management expertise, along with extensive experience on other public and private companies during his career in private equity, investment banking and consulting. Mr. Plantevin's background in consulting and his significant involvement with the Company position himcompany boards to provide valuable contributions to ourTrinseo’s Board.
17 2023 Proxy Statement
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PROPOSAL 2
RATIFICATION OF APPOINTMENT OF CLASS III DIRECTOR
We are asking the shareholders to ratify the appointment of Stephen F. Thomas to fill a vacancy in Class III, with a term expiring in 2017. Biographical information concerning Mr. Thomas is set forth above.
According to our articles of association, vacancies on the
Corporate Governance
Board must be filled by the affirmative vote of the majority of remaining directors on a provisional basis until a new director is appointed by the next meeting of shareholders. On September 18, 2015, the Board approved, by circular resolution, the appointment of Stephen F. Thomas to the Company's Board to fill the seat vacated by Seth A. Meisel, with immediate effect. Mr. Thomas will cease to be a Class III Director if this Proposal 2 is not approved by our shareholders.YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL 2, THE RATIFICATION OF THE BOARD'S APPOINTMENT OF MR. THOMAS AS A CLASS III DIRECTOR.
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PROPOSAL 3
RATIFICATION OF DIRECTOR COMPENSATION PROGRAM
Luxembourg law requires our shareholders to approve our director compensation programs. Our director compensation program for 2015 for our non-executive directors described below under "Director Compensation" is expected to continue during 2016. Our director compensation program generally includes annual cash and equity retainers of $90,000 each, plus additional cash retainers for committee chairs. We do not offer additional compensation to our management directors. We believe that our current director compensation program to be competitive and designed to attract qualified Board members. Our Board evaluates our director compensation programs periodically and may adjust our director compensation programs from time-to-time as it deems necessary and appropriate.
YOUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" THE RATIFICATION OF THE COMPANY'S DIRECTOR COMPENSATION PROGRAM.
DIRECTOR COMPENSATION
The following table sets forth information concerning the compensation earned by our directors during fiscal 2015. Compensation for Mr. Pappas is included with that of our other named executive officers. Mr. Pappas did not receive any additional compensation for his service on our Board.
| | | | | | | | | | |
| | Fees Earned
or Paid in
Cash ($)(1) | | Stock Awards
($)(2)(3)(4) | | Total ($) | |
|---|
Brian W. Chu | | $ | 90,000 | | $ | 90,000 | | $ | 180,000 | |
Jeffrey J. Cote | | $ | 115,000 | | $ | 90,000 | | $ | 205,000 | |
Pierre-Marie De Leener | | $ | 90,000 | | $ | 90,000 | | $ | 180,000 | |
Seth A. Meisel | | $ | 67,500 | | $ | 90,000 | | $ | 157,500 | |
Donald T. Misheff | | $ | 75,000 | | $ | 90,000 | | $ | 165,000 | |
Michel G. Plantevin | | $ | 90,000 | | $ | 90,000 | | $ | 180,000 | |
Stephen F. Thomas | | $ | 37,500 | | $ | — | | $ | 37,500 | |
Aurélien Vasseur | | $ | 90,000 | | $ | — | | $ | 90,000 | |
Stephen M. Zide | | $ | 105,000 | | $ | 90,000 | | $ | 195,000 | |
(1)Consists of annual retainer amounts, which are paid monthly and prorated based on the director's service dates.
(2)The amounts reported represent the grant date fair value of restricted stock units granted in 2015 calculated in accordance with ASC 718, excluding the effects of estimated forfeitures. The assumptions used for determining fair value are described in Note 17 to our consolidated financial statements filed with our Annual Report on Form 10-K.
(3)Messrs. Chu and Meisel forfeited their restricted stock unit awards in connection with their resignation from the Board. Mr. Chu resigned effective February 1, 2016 and was replaced by Mr. Hauser. Mr. Meisel resigned from our board of directors effective September 18, 2015 and was replaced by Mr. Thomas.
(4)As of December 31, 2015, Messrs. Cote, De Leener, Misheff, Plantevin, and Zide each held 3,236 shares of the Company pursuant to their unvested restricted stock unit awards. As of December 31, 2015, Messrs. Chu, Meisel, Thomas, and Vasseur had no outstanding equity awards.
Our Board maintains a non-employee director compensation program under which each member of our Board who is not an employee of the Company or one of our subsidiaries will be eligible to
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receive an annual cash retainer payment of $90,000. Additionally, Messrs. Chu, Cote, De Leener, Meisel, Misheff, Plantevin, and Zide each received an annual equity retainer of 3,236 restricted stock units with a grant date fair value of $90,000, which vest on the one-year anniversary of their grant date. Our director compensation program also provides annual cash retainer payments for the chairpersons of the audit committee and compensation committee of $25,000 and $15,000, respectively.
CORPORATE GOVERNANCE
Board Nominees.Nominees
Under its charter, our nominating and corporate governance committee is responsible for recommending to the Board candidates to stand for election to the Board at the Company'sCompany’s annual general meeting of shareholders and for recommending candidates to fill vacancies on the Board that may occur between annual general meetings. It is the policy of the Board that directors should possess the highest personal and professional ethics, integrity and values. Board members are expected to become and remain informed about the Company, its business and its industry and rigorously prepare for, attend and participate in all Board and applicable committee meetings. The committee evaluates each individual in the context of the Board as a whole, with the objective of recommending a group that can best perpetuate the success of our business and represent shareholdershareholders’ interests through the exercise of sound judgment using its diversity of experience. In addition, the Board considers, in light of our business and Board composition, each director nominee'snominee’s experience, qualifications, attributes and skills that are identified in the biographical information contained under "Proposal 1—ElectionProposal 1. Recommendation of Directors."Board Candidates
The nominating and corporate governance committee considers properly submitted recommendations for candidates to the Board from shareholders. Any shareholder may submit in writing nominations of persons for consideration for each shareholder meeting at which directors are to be elected by not later than the 90th calendar day nor earlier than the 120th calendar day before the date of the annual general meeting. Any shareholder recommendations for consideration by the Board should include the candidate'scandidate’s name, biographical information, information regarding any relationships between the candidate and the shareholder within the last three years, a statement of recommendation of the candidate from the shareholder, a description of our shares beneficially owned by the shareholder, a description of all arrangements between the candidate and the recommending shareholder and any other person pursuant to which the candidate is being recommended, a written indication of the candidate'scandidate’s willingness to serve on the Board, of Directors, any other information required to be provided under securities laws and regulations, and a written indication to provide such other information as the Board may reasonably request. Recommendations should be sent to Angelo N. Chaclas, Corporate Secretary, Trinseo S.A., 1000 Chesterbrook Boulevard,PLC, 440 East Swedesford Road, Suite 300, Berwyn,301, Wayne, PA 19312.19087. The Board evaluates candidates for the position of director recommended by shareholders or others in the same manner as candidates from other sources. The Board will determine whether to interview any candidates and may seek additional information about candidates from third-party sources. As part of its ongoing succession planning, the Company seeks to identify potential Board Independence.nominees on behalf of the Board that meet the Board’s requirements with respect to diversity, experience, skill, and qualifications.
Shareholder Board Nominees Shareholders who wish to nominate one or more persons for election as a director of the Company at an annual general meeting of shareholders, and who wish the nomination to be included in the proxy materials for that meeting pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, must follow the requirements set forth in this proxy statement under “Shareholder Proposals & Director Nominations.” Shareholder director nominations must comply with the deadlines and other requirements in Article 101 of our Constitution, including the applicable notice, information and consent provisions.
Board Independence Our Corporate Governance Guidelines provide that our Board shall consist of such number of directors who are independent as is required and determined in accordance with applicable laws and regulations and requirements of the NYSE. The Board evaluates any relationships of each director and nominee with Trinseo and makes an affirmative determination whether or not such director or nominee is independent. Under our Corporate Governance Guidelines, an "independent"“independent” director is one who meets the qualification requirements for being an independent director under applicable laws and the corporate governance listing standards of the NYSE. Our Board reviews any transactions and relationships between each non-management director or any member of his or her immediate family and Trinseo. The purpose of this review is to determine whether there were any such relationships or transactions and, if so, whether they were inconsistent with a determination that the director was independent. AsThe Company maintains a "controlled company"related party transactions policy and conflict of interest policy, as defineddiscussed below under the NYSE Listing Rules, our
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Board is not required to be comprised of a majority of independent directors.“Related Party Transactions.” As a result of thisits review, our Board has affirmatively determined that all of our current directors and nominees, except for Mr. Pappas,our CEO and President, Frank Bozich, are independent under the governance and listing standards of the NYSE. Messrs. Chu and Meisel, who each served on the Board in 2015, were not deemed to be independent.
Diversity and Board Expertise. While we do not have a formal policy with respect to diversity, weExpertise We believe that the diversity considerations are an important element, among many, when identifying director nominees who will best serve the needs of the Company and the interests of our shareholders. We believeThese diversity considerations enable us to provide sound and prudent guidance by developing a Board with a diverse range of talents, ages, skills, character, expertise, professional experiences, and backgrounds.
Risk Oversight.Oversight Risk is inherent in every material business activity that we undertake. Our business exposes us to strategic, credit, market, compliance, operational and reputational risks. To support our corporate goals and objectives, risk appetite, and business and risk strategies, we maintain a governance structure that delineates the responsibilities for risk management activities, and the governance and oversight of those activities, between management and our Board. The Board is committed to strong, independent oversight of management and risk through a governance structure that includes other Board committees. Under our structure, it is management'smanagement’s responsibility to manage risk and bring to the Board'sBoard’s attention risks that are material to Trinseo. The Board has oversight responsibility for the systems established to report and monitor the most significant risks applicable to Trinseo. The Board administers its risk oversight role directly and through its committee structure and the committees'committees’ regular reports to the Board at Board
2023 Proxy Statement 18
meetings. The Board divides its risk oversight responsibilities between itself and its committees by having each review or assess key issues or areas of responsibility as follows:| | | |
| Board of Directors | | | Strategic, financial, and execution risks and exposures associated with our annual and multi-year business plans |
| | Acquisitions and divestures •
Capital expenditure and budget planning •
Major litigation, investigations, and other matters that present material risk to our operations, plans, prospects, or reputation •
Review of enterprise risk management including cybersecurity and information security risk oversight
| |
| | | •
Acquisitions and divestures
|
| | •
Senior management succession planning
|
Audit Committee | | | Risks associated with financial accounting matters, including financial reporting, accounting, disclosure, and internal controls over financial reporting |
| | Supervision and selection of our external and internal auditors •
Our ethics and compliance programs
| |
| | Compensation and Talent Development Committee | •
Related party transactions
|
Compensation Committee
| | Risks related to the design of our executive compensation programs, plans, and arrangements •
Senior management succession planning
| |
| Nominating and Corporate Governance Committee | | | Risks related to our governance structures and processes •
Director succession planning | |
| Environmental, Health, Safety, Sustainability and Public Policy Committee | | | Our environmental, health and safety risk management programs The alignment of our environmental, health, safety, sustainability, social and public policy program with the Company'sCompany’s business strategy and creation of stakeholder value | |
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Board Leadership Structure.Structure
Under our Corporate Governance Guidelines, our Board may select a Chairman of the Board of DirectorsChair at any time, who may also be an executive officer of the Company. The Board has currently chosen to separate the roles of ChairmanBoard Chair and Chief Executive Officer. Mr. Zide, our current non-executive Chairman ofOfficer, which the Board of Directors, has served as a director since 2010 and brings to the Board extensive knowledge and expertise in strategy, mergers and acquisitions. The Board believes that the separate roles of Mr. Zide and Mr. Pappas, our Chief Executive Officer, areis currently in the best interest of Trinseo and its shareholders, at this time. Mr. Zide has in-depth knowledge of our business arising from his many years of service to Trinseo and, as a result, provides effective leadership for the Board and support for Mr. Pappas and other management. Theshareholders. This structure permits Mr. Pappasour Chief Executive Officer to devote his attention to leading Trinseo and to executing on our business strategy.
Ms. Johnson is our current non-executive Board Attendance.Chair and has served as a director since 2017. Ms. Johnson brings significant experience as Chair, including, but not limited to: (i) entrepreneurial and senior public company experience; (ii) expertise in environmental, social and governance issues; and (iii) strategic transformation experience. Ms. Johnson has significant experience in the specialty chemical industry and as a public company director. As described above, the Board has determined that Ms. Johnson meets the definition of an independent director under NYSE listing standards. The nominating and corporate governance committee will recommend adjustments to committee assignments to the Board as it deems necessary during the year.
Board Attendance We expect our boardBoard members to prepare for, attend and participate in all boardBoard and applicable committee meetings. Our Board held fournine meetings in 2015.2022. The audit, compensation and talent development, and nominating and corporate governance committees held 8, 6,nine, six and 3four meetings in 2015,2022, respectively. OurNo Board members were in attendance for all board meetings andmember attended less than 75% of our Board or committee meetings, as applicable, in 2015. 2022.
We do not have a policy for the attendance of our directors at our annual general meeting of shareholders. We had one director in attendance for our 2015 annual general meeting of shareholders for whichIn 2022 thirteen directors and no shareholders attended. Under Luxembourg law we are required to receive notice by the meeting's record date of a shareholder's intention to attend the annual general meeting of shareholders in person. Additionally,attended our annual general meetingmeeting. Eligible shareholders were permitted to attend in person by registering on our voting website. Notwithstanding any extenuating circumstances which would impact the safety of shareholders, unless there is an exceptional circumstance, areattendees, this year’s Annual Meeting will be held in Luxembourg.person, using the same registration method for shareholders who wish to attend. There will not be a teleconference or video conference option.
Executive Sessions.Sessions Our Corporate Governance Guidelines provide that the non-management directors of the Board meet in executive session at least once during each regularly scheduled Board meeting to review matters concerning the relationship of the Board with the managementexecutive directors and other members of senior management, and such other matters as it deems appropriate. Mr. Zide acts as the chair of the non-management directors' executive sessions. Additionally, the Board has atis required to have least one executive session annually of its independent directors. Mr. Cote actMs. Johnson acts as the chair for the independent directors'of these executive sessions.
Board Annual Performance Reviews.Reviews Pursuant to our Corporate Governance Guidelines the Board annually conducts a self-evaluation of the Board as a whole. In accordance with the written charters of our audit, committee, compensation committeeand talent development, and nominating and corporate governance committees, each committee we also evaluate each committee'sevaluates its performance on an annual basis and reportreports its findings to the Board the findings.Board.
19 2023 Proxy Statement
Code of Business Conduct.Conduct We have adopted a written Code of Business Conduct applicable to all directors, officers and employees and a written Code of Ethics for Senior Financial Employees, applicable to our Chief Executive Officer, Chief Financial Officer, Treasurer, Principal Accounting Officer, Controller, and all employees performing similar functions. These policies are designed to maintain the integrity of our business and financial reporting. These codes cover, among other things, professional conduct, conflicts of interest, accurate recordkeeping and reporting, public communications and the protection of confidential information, as well as adherence to laws and regulations applicable to the conduct of our business. Copies of these codes can be found by under the "Corporate Governance" link“Governance” tab on the "Ethics and Compliance" tab of the Investor Relations section of our website,www.investor.trinseo.com.
investor.trinseo.com by selecting the “Ethics and Compliance” link and then “supporting policies.” Corporate Governance Guidelines.Guidelines We have adopted Corporate Governance Guidelines that outlinesoutline the Board'sBoard’s governance policies and practices. The current version of our Corporate Governance Guidelines is availablecan be found under the “Governance” tab on the Investor Relations section of our website, atwww.investor.trinseo.com.investor.trinseo.com by selecting the “Ethics and Compliance” link and then “supporting policies.”
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Communications with Directors.Directors Shareholders and other interested parties may communicate directly with the Board, the non-management directors or the independent directors as a group, or specified individual directors by writing to such individual or group c/o Corporate Secretary, Trinseo S.A., 1000 Chesterbrook, Boulevard,PLC, 440 East Swedesford Road, Suite 300, Berwyn,301, Wayne, PA 19312.19087. The Corporate Secretary will forward such communications to the relevant group or individual at or prior to the next meeting of the Board. The Board has instructed our Corporate Secretary to review the correspondence prior to forwarding it, and in his discretion, not to forward certain items if he deems them to be of a commercial or frivolous nature or otherwise inappropriate for the Board'sBoard’s consideration. In these cases, he may forward some of the correspondence elsewhere in the Company for review and possible response.
2023 Proxy Statement 20
Board Structure and Committee Composition
Board Structure and Committee Composition
We have a standing audit committee, compensation committee and atalent development committee, nominating and corporate governance committee, and an environmental, health, safety, sustainability and public policy committee with the composition and responsibilities described below. Each committee operates under a charter that has been approved by our Board of Directors.Board. A copy of each charter can be found by clicking on "Corporate Governance"“Governance” and then "Committee Composition"“Committee Composition” in the Investor Relations section of our website,www.investor.trinseo.cominvestor.trinseo.com. The members of each committee are appointed by the Board of Directors and each member serves until his or her successor is elected and qualified, unless he or she is earlier removed or resigns. In addition, from time to time, special committees may be established under the direction of the Board of Directors when necessary to address specific issues. The table below provides information about the membership of our standing audit, compensation and talent development, nominating and corporate governance and our and environmental, health, safety, sustainability and public policy committees during fiscal 2015:2022:
| | Name | | | Audit | | | Compensation and
Talent Development | | | Nominating and
Corporate Governance |
Name
| | Audit | | Compensation | | Nominating
| | | Environmental, Health,
Safety, Sustainability
and Corporate
Governance | |
|---|
Brian W. Chu(1)
Public Policy | | | X | | | | | | | |
| K’Lynne Johnson † | | | | | | ✓ | | | ✓ | | | | |
| | Joseph Alvarado | | | | | | Chair | | | ✓ | | | | |
| | Frank Bozich | | | | | | | | | | | | ✓ | |
| | Victoria Brifo | | | | | | ✓ | | | | | | ✓ | |
| | Jeffrey J. Cote § | | | X✓ | * | | | | | | | | ✓ | |
| Pierre-Marie De Leener | | | X | | | ✓ | | | | | | ✓ | |
Seth A. Meisel(2)
| Jeanmarie Desmond § | | | ✓ | | | | | | | | | ✓ | |
| Matthew Farrell § | | | ✓ | | | ✓ | | | | | | | |
| | Sandra Beach Lin | | | | | | | | | ✓ | | | Chair | |
| | Philip R. Martens * | | | | | | ✓ | | | Chair | | | | |
| | Donald T. Misheff(3)Misheff § * | | | X✓ | | | | | | ✓ | | | | |
Christopher D. Pappas
| Henri Steinmetz | | | ✓ | | | | | X | * | | | ✓ | |
Michel G. Plantevin
| Mark Tomkins § | | | Chair | | X | | | | |
Stephen F. Thomas(2)
✓ | | | | | | | | | | |
Aurélien Vasseur
| | | | | | | | | | |
Stephen M. Zide
| | | | | | X | * | | X | |
Denotes Board Chair.
§
Denotes Audit Committee Financial Expert
*Chair
(1)
Mr. Chu resigned as a member of our audit committee in February 2015Martens and was replaced by Donald T. Misheff. Mr. Chu resigned from our board of directors effective February 1, 2016 and was replaced by Mr. Hauser.
(2)Mr. Meisel resigned from our board of directors on September 18, 2015, and was replaced by Mr. Thomas, who rejoined our board of directors following his resignation on February 19, 2015.
(3)Mr. Misheff joined our board of directors on February 19, 2015.
As a "controlled company" under the New York Stock Exchange (the "NYSE") listing rules, we are eligible to take advantage of certain exemptions to NYSE Listing Rules. Therefore, our nominating
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and corporate governance committee ishave announced they will not composed entirely of independent directors as defined under these rules.
stand for reelection in 2023.
The purpose of the audit committee is set forth in the audit committee charter. The audit committee'scommittee’s primary duties and responsibilities are to: •
Appoint or replace, compensate and oversee the outside auditors for the purpose of preparing or issuing an audit report or related work or performing other audit, review or attest services for us and willto report directly to the audit committee.
•
Pre-approve all auditing services and permitted non-audit services (including the fees and terms thereof) to be performed for us by our outside auditors, which are approved by the audit committee prior to the completion of the audit.
•
Review and discuss with management and the outside auditors the annual audited and quarterly unaudited financial statements, our disclosures under "Management's“Management’s Discussion and Analysis of Financial Condition and Results of Operations"Operations”, and the selection, application and disclosure of critical accounting policies and practices used in such financial statements.
•
Review and approve all related party transactions as defined under Item 404(a) of Regulation S-K.
•
Discuss with management and the outside auditors significant financial reporting issues and judgments made in connection with the preparation of our financial statements, including any significant changes in our selection or application of accounting principles, any major issues as to the adequacy of our internal controls and any special steps adopted in light of material control deficiencies.
A copy of the charter, which satisfies the applicable standards of the Securities and Exchange Commission (the "SEC")SEC and the NYSE is available on our website. The audit committee currently consists of Jeffrey J. Cote, Jeanmarie Desmond, Matthew Farrell, Donald T. Misheff, Jeffrey J. CoteHenri Steinmetz and Pierre-Marie De Leener.Mark Tomkins. Our Board has determined that Ms. Desmond and each of Messrs. Cote, Farrell, Misheff, CoteSteinmetz and De LeenerTomkins are independent directors pursuant to Rule 10A-3(b)(1) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"“Exchange Act”), and
21 2023 Proxy Statement
Board Structure and Committee Composition
Section 303A.02 of the New York Stock Exchange Listed Company Manual. EachMs. Desmond and each of Messrs. Cote, Farrell, Misheff and CoteTomkins is also an "audit“audit committee financial expert"expert” within the meaning of Item 407(d)(5) of Regulation S-K. Mr. CoteTomkins serves as chair of the audit committee.
Compensation & Talent Development Committee The purpose of the compensation and talent development committee (the “compensation committee”) is to assist the Board in fulfilling its responsibilities relating to oversight of the compensation of our directors, executive officers and other employees and the administration of our benefits and equity-based compensation programs. The compensation committee reviews and recommends to our Board compensation plans, policies and programs and approves specific compensation levels for all executive officers. The compensation committee currently consists of Jeffrey J. Cote, Michel G. Plantevin,Joseph Alvarado, Victoria Brifo, Pierre-Marie De Leener, Matthew Farrell, K’Lynne Johnson and Stephen M. Zide.Philip R. Martens. Mr. Cote joined the compensation committee in March 2016. Mr. ZideAlvarado serves as chair of the compensation committee. A copy of itsthe compensation committee’s charter, which satisfies the applicable standards of the SEC and the NYSE, is available on our website. Pursuant to its charter, the compensation committee may delegate to subcommittees of the compensation committee any of the responsibilities of the full committee.
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Nominating and Corporate Governance Committee
The purpose of the nominating and corporate governance committee is to (i) identify, screen and review individuals qualified to serve as directors (consistent with criteria approved by our Board) and recommend to our Board candidates for nomination for election at theour annual meeting of shareholders or to fill Board vacancies or newly created directorships; (ii) develop and recommend to our Board and oversee the implementation of our corporate governance guidelines; (iii) oversee evaluations of our Board and (iv) recommend to our Board candidates for appointment to boardBoard committees. The committee also reviews the outcome of shareholder engagement. The nominating and corporate governance committee currently consists of Joseph Alvarado, K’Lynne Johnson, Sandra Beach Lin, Philip R. Martens, Donald T. Misheff Christopher D. Pappas, and Stephen M. Zide.Mark Tomkins. Mr. Misheff joined the nominating and corporate governance committee in March 2016. Mr. PappasMartens currently serves as chair of the nominating and corporate governance committee and is not an independent director under the NYSE Listing Rules.committee. Our Board has adopted a written charter under which the nominating and corporate governance committee operates.operates, which is available on our website.
Environmental, Health, Safety, Sustainability and Public Policy Committee
The Environmental, Health, Safety, Sustainability and Public Policy Committee (the “EHSS&PP committee”) was established for the purpose of assisting the Board in fulfilling its oversight responsibilities by assessing the effectiveness of programs and initiatives that support the environment, health and safety, sustainability, corporate social responsibility and climate change (“Sustainability”) policies and programs of the Company. Its duties and responsibilities are to:
•
Support alignment between the Company and the Board on the Company’s Sustainability, social, and public policy goals;
•
Guide the Company on its Sustainability programs, policies, partnerships, activities and goals to ensure consistency with and impact upon the Company’s business strategy and the creation of stakeholder value and relationships;
•
Review of external public policy/governmental affairs issues and trends in order to more effectively achieve the Company’s business goals, and provide recommendations to the Board regarding the Company’s response to these issues consistent with applicable legal and regulatory requirements;
•
Review, approve and recommend to the Board for adoption, the Company’s annual public Sustainability and Corporate Social Responsibility Report; and
•
Assist the Board in fulfilling its oversight responsibility for the Company’s risk management programs by assessing risks that may arise in connection with the Company’s Sustainability, programs, partnerships, activities and goals.
The EHSS&PP committee currently consists of Frank A. Bozich, Victoria Brifo, Jeffrey J. Cote, Pierre-Marie De Leener, Jeanmarie Desmond, Sandra Beach Lin and Henri Steinmetz. Ms. Beach Lin serves as chair of the EHSS&PP committee. A copy of theits charter is available on ourthe Company’s website.
Compensation Committee Interlocks and Insider Participation None of our executive officers serves as a member of the
board of directorsBoard or the compensation committee of any other company that has any executive officers serving as a member of our Board or compensation committee.
2023 Proxy Statement 22
Our Company’s Executive Officers
Our Company’s Executive Officers
Biographical information concerning our President and Chief Executive Officer, and Interim Chief Financial Officer, Christopher D. Pappas,Frank A. Bozich, who also serves asis a member ofnominee to our board of directors,Board, is set forth above under Proposal 1—Election of Directors.Martin Pugh,1.
David Stasse, Executive Vice President and Chief OperatingFinancial Officer. Mr. Pugh, 63, becameStasse, age 52, has served as the Company'sCompany’s Executive Vice President and Chief OperatingFinancial Officer in November 2015.since July 2019. Mr. PughStasse joined the Company in July 2013 as Senior Vice President and Business President, Plastics, in March 2013Treasurer with responsibility for all treasury matters, including cash management, risk management, relationships with rating agencies and commercial banks, and financing matters. During his tenure he added responsibility for Investor Relations and Corporate Finance for the Company. Prior to joining Trinseo, Mr. Stasse was named Senioremployed by Freescale Semiconductor, Inc., a global semiconductor manufacturer that served the automotive, networking, consumer and industrial markets, where he served as Vice President and Business President, Performance Materials in October 2014, where was responsible for the global leadership of the Company's Performance Materials business with overall accountability for the Rubber, Latex and Performance Plastics businesses. PriorTreasurer from 2008 to joining the Company, Mr. Pugh held the position of President for Europe, Middle East and Africa (EMEA) and board member for Styrolution Group Gmbh, the global styrenics joint venture between BASF Group and INEOS from October 2011 until February 2013. Mr. Pugh began his careerStasse holds an MBA in 1975 with Mobil Oil Company as a technical representative. He joined The Dow Chemical Company in 1978Finance from the University of Maryland and served in a variety of sales and marketing roles from 1978 until 1998, working in the UK, Dubai, Sweden and Switzerland. His final role at Dow was global business director for Specialty Polyethylenes. In 1998, Pugh joined Elementis plc as Managing Director for the specialty rubber division called Linatex. In 2002, he returned to Switzerland and joined Nova Chemicals as Managing Director for Europe. Following the formation of Nova Innovene in 2005, he was appointed Managing Director of the company and continued in the role of Managing Director—Europe as the company was broadened to include the Americas region and renamed INEOS Nova. He remained in this position within INEOS Nova and INEOS Styrenics until the formation of Styrolution Group GmbH in October 2011. Mr. Pugh has a Bachelor of Science degree in Industrial ChemistryBusiness Logistics from Penn State University.
Jean-Luc Béal, Senior Vice President, Engineered Materials. Mr. Béal, age 58, joined Trinseo in May 2021 following the Company’s acquisition of Arkema’s PMMA business. Prior to joining the organization, Mr. Béal served as Regional Vice President for EMEA & Global Methacrylics for Arkema’s PMMA Business from 2018, and Management Studiesas Regional President EMEA Consumer & Construction Adhesives for Arkema since 2015. Mr. Béal brings 30 years of chemical industry experience, working chemical branches at Total and Arkema where he held several R&D, marketing, business and managing director roles in specialty polymer and downstream businesses, such as specialty polyamides & fluoropolymers, plastic conversion, coating resins and adhesives involved in Automotive, Building and Construction, and consumer product markets. Mr. Béal holds a Master of Science in Chemical Engineering from Loughborough University in the United Kingdom.CPE Lyon.
Angelo N. Chaclas,Senior Vice President, Chief Legal Officer, Chief Compliance Officer and Corporate Secretary. Mr. Chaclas, 52,age 59, has been the Company'sCompany’s Chief Legal Officer, Senior Vice President, and Corporate Secretary since January 2015. Mr. Chaclas also became the Chief Compliance Officer in June 2018. In his role, he provides legal support for all capital markets, transactional, compliance, commercial, litigation, regulatory, governance, intellectual property and other operational activities of the Company worldwide. Mr. Chaclas joined the Company in 2010 as Associate
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General Counsel and Chief Intellectual Property Counsel, where he managed the Company'sCompany’s global intellectual property portfolio and supportedmanaged the legal activities of several of the Company'sCompany’s commercial businesses. Prior to joining the Company in 2010, Mr. Chaclas was Deputy General Counselbusinesses and Chief Counsel for the software division of Pitney Bowes where he led its Intellectual Property, Technology Law and Procurement legalcorporate functions. Mr. Chaclas holds a bachelor'sbachelor’s degree in Mechanical Engineering from Tufts University and a Juris Doctorate from Pace University.
Marilyn N. Horner,
Paula Cooney,Senior Vice President—President and Chief Human Resources.Resources Officer. Ms. Horner, 58,Cooney, age 54, joined the Company as Senior Vice President, of Human Resources in January 2011.November 2021. Prior to joining the Company,Trinseo, Ms. Horner held a number of executive positions at NOVA Chemicals where she started her career in 1988. She served as theCooney was Senior Vice President and Chief Human Resources OfficerCHRO for NOVA Chemicals from 2008 to December 2010.FLIR Systems, Inc. where she provided strategic direction as the company’s human resources leader. Before FLIR Systems, Inc., Ms. Horner also held the positions of Vice President Finance and Controller, Olefins / Polyolefins Division;Cooney served as Vice President, Human Resources and Organizational Effectiveness;Communications for H.B. Fuller Company, where she worked for 10 years and held multiple roles in HR leadership. Prior to joining H.B. Fuller in 2010, Ms. Cooney enjoyed a nearly 15-year career at Intel Corporation, holding HR roles of increasing responsibility. Ms. Cooney holds an NCEA diploma in personnel management from the National College of Ireland, and a Master pf Business Studies in human resources and industrial relations from University College Dublin (Smurfit School of Business).
Johanna Frisch,Vice President and Treasurer. Ms. Frisch, age 44, was named Vice President and Treasurer in January 2022. Previously, Ms. Frisch served as the Company’s Global Assistant Treasurer and in various roles of increasing responsibility within the Company’s Treasury department starting in 2010. Prior to the Chief Executive Officer.joining Trinseo, Ms. HornerFrisch served on the boardas Treasurer of trusteesNycomed Pharmaceutical Company from 2008-2010, and prior to that held several analyst positions for Point Park University and theThe Dow Chemical Company. Ms. Frisch holds a B.S. degree in international business management from University of Alberta. Ms. HornerMaryland University College, Schwaebisch Gmuend/Germany.
Han Hendriks,Senior Vice President, Chief Technology Officer. Mr. Hendriks, age 57, was appointed as Chief Technology Officer in October 2022. In his role, Hendriks leads the development of differentiated technology and innovation across the organization. Prior to joining Trinseo, Mr. Hendriks was Chief Technology Officer at Yanfeng, one of the world’s leading automotive suppliers, headquartered in Shanghai. Mr. Hendriks was responsible for the company’s technology and “smart cabin” vision and strategy, as well as portfolio management, and led the design and development of new products from research to market launch. Prior to Yanfeng, Mr. Hendriks worked for Johnson Controls, holding multiple roles of increasing responsibility. Mr. Hendriks holds a Bachelor of Commerce degreeFine Arts in Architectural Design from the Academy of Fine Arts in Maastricht and an MBA from the University of WindsorWestminster, London, and he successfully completed a post-graduate Industrial Design program at the Università Internazionale Dell ‘Arte in Ontario, Canada. E. Jeffery Denton,Florence.
Nicolas Joly,Senior Vice President—Corporate Development and Business Services.President, Styrenics. Mr. Denton, 50, joined the Company as Vice President—Shared Services and Feedstocks in June 2010 andJoly, age 45, was named Vice President—Corporate DevelopmentPresident of Plastics & Feedstocks in May 2020. Mr. Joly began at Trinseo in 2010 and has most recently served as Trinseo’s Global Director of Polystyrene & Feedstocks since 2017, after serving as Trinseo’s Integrated Business Services Director for Europe, Middle East, and Africa region since 2015. In 2012, Mr. Joly was named Product Manager for Polycarbonate Compounds and Blends, before moving on to become Global Product Director for Polycarbonate in October 2014, and subsequently Senior Vice President in October 2015. Mr. Denton is responsible for the Company's Feedstocks, Procurement, Supply Chain, Customer Service, Information Technology and Corporate Development activities.2013. He previously servedworked at The Dow Chemical Company in 2002 where he held a similar roleseries of sales and marketing roles in Plastics. He began his career at the Company (when it wasProcter & Gamble in 2001. Mr. Joly holds a divisionMaster of Dow)Science in Chemical Engineering from September 2009 until June 2010 and as the Director of Joint Venture Implementation at Dow, implementing Americas Styrenics & K-Dow from February 2006 until September 2009. Prior to that, he served as Product Director of Dow Polystyrene and Commercial Manager of Dow Polystyrene and Engineering Plastics from 1998 to January 2007. Mr. Denton received a bachelor's degree in Business Administration from Alma College.Timothy M. Stedman,CPE Lyon.
Andre Lanning,Senior Vice President and BusinessChief Commercial Officer. Mr. Lanning, age 57, was named the Company’s Senior Vice President Basic Plastics & Feedstocks.and Chief Commercial Officer in February 2022. Prior to being named CCO, Mr. Stedman, age 46, joined the CompanyLanning served as Senior Vice President and Business President, Basic Plasticsof
23 2023 Proxy Statement
Our Company’s Executive Officers
Strategy, Corporate Development & Feedstocks, in November 2015. In this role, he is responsible for business leadership for polystyrene, co-polymers, polycarbonate, and styrene monomer. As part of his role, he servesMarketing Communication from May 2020. Previously, Lanning served as a member of the operating committee of the Plastics Division of the American Chemistry Council. Prior to joining the Company, Mr. Stedman spent more than 20 years with ExxonMobil Chemical working in the U.K., the U.S., and Belgium. Most recently, Mr. Stedman was the EuropeGlobal Business Director for ExxonMobil Chemical's Basic ChemicalsTrinseo’s Synthetic Rubber Business. Mr. Lanning brings thirty years of chemical industry experience to Trinseo, joining the business and prior to that was the Site Manager for the Fife Ethylene Plant (steam cracker) in Scotland. Stedman also led Global Sales and Marketing organizations for several ExxonMobil Chemical's Polymers and Intermediates businesses, including the Santoprene business that was formally partfrom Advanced Refining Technologies (ART), where he served as Managing Director/CEO of the Advanced Elastomers SystemsART Hydroprocessing; a joint venture with Monsanto.between WR Grace and Chevron, based in the United States. Throughout his career, Lanning has held several senior business leadership roles, including in the Pulp & Paper, Fertilizer, and Refining Catalyst sectors. Mr. Stedman served on the boards of Petrochemicals Europe and the European Petrochemical Association until September 2015 and was also a member of the Energy and Climate Change Leadership Group of the International Council of Chemical Associations (ICCA). Mr. StedmanLanning holds a degreeMaster of Science in Chemical Engineering from the University of Manchester InstituteTwente, The Netherlands, and a Master of Business Administration from TSM Business School.
James Ni,Senior Vice President, Latex Binders. Mr. Ni, age 53, has served as Senior Vice President, Latex Binders since September 2020 and had previously served as Asia Pacific (APAC) Business Director, Latex Binders since 2012. Mr. Ni remains Managing Director, APAC, a position in which he provides leadership across the region in driving critical priorities and growth projects. Mr. Ni joined Trinseo as Commercial Director of Trinseo Latex in 2010, and was promoted to Business Director, APAC, in 2012. Prior to joining Trinseo, he worked as Sales Director of Emulsion Polymers at Dow Chemical (China) Co., Ltd. since 1995. During his 15-year tenure there, Mr. Ni was promoted several times and acquired extensive knowledge and experience in resin, polymers and latex business both in China and in the US. Mr. Ni holds a Master of Business Administration (MBA) from Central Michigan University, Graduate School of Business, and a Bachelor of Science and Technology, U.K., and the Ecole Nationale Supérieure des Industries Chimiques, Nancy, France. He is also a Chartered Engineer and a Fellow of the Institute of Chemical Engineers (U.K.). Hayati Yarkadas,in Mechanical Engineering from Shanghai Jiao Tong University.
Francesca Reverberi,Senior Vice President and Chief Sustainability Officer. Ms. Reverberi, age 51, was named Senior Vice President and Chief Sustainability Officer in September 2021. Previously, Ms. Reverberi served as Senior Vice President, Engineered Materials & Synthetic Rubber, with responsibility for the Automotive, Consumer Electronics, Medical, Sheet & Extrusion, and Building & Construction plastics markets as well as the global synthetic rubber business. Ms. Reverberi also served as Global Business President,Director of Performance Materials. Mr. Yarkadas,Plastics, Business Director of Basic Plastics and prior to that, Global Business Director for Synthetic Rubber. Ms. Reverberi joined Trinseo following the Company’s carve-out from The Dow Chemical Company in June 2011. During her time at Dow, Ms. Reverberi served as Product Director for Emulsion Polymers, Europe and the Americas, as well as Commercial Manager in Dow Hydrocarbons Aromatics and Derivatives in Europe, including responsibilities for the C4’s business and held several positions in other specialty businesses such as Water Solutions and Chelants. Ms. Reverberi holds a Bachelor and Master of Science in Chemical Engineering from Politecnico di Milano and a Master of Business Administration from SDA Bocconi.
Rainer Schewe,Senior Vice President—Supply Chain Services. Schewe, age 47,59, joined the Company in November 2015 to lead the Rubber, Latex, and Performance Plastics businesses. Mr. Yarkadas has more than 20 years of experience in materials businesses and an established track record of business management and leadership skills.April 2020 as Vice President—Supply Chain Services. Prior to joining Trinseo, Mr. Yarkadas led the food ingredient business of Tate & Lyle in EuropeSchewe served as SeniorExecutive Vice President and General Manager, based in London.Chief Supply Chain Officer for A. Schulman, Inc. (now LyondellBasell Industries). Prior to that, Mr. Yarkadas spent over 17 years with
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DuPont in many of its worldwide locations. Most recently Mr. Yarkadas served as General Manager of the DuPont Teijin Films joint venture, where he was responsible for the financial results and transformation of the business. Previously, he was Global Business Director for DuPont Advanced Glass Interlayers and held a series of roles in sales, sales management, Six Sigma, marketing, product management and business management in plastics and chemicals. Throughout his career, Mr. Yarkadas gained significant operating and global leadership skills with various roles in Turkey, the U.K., Switzerland, the U.S., and Luxembourg. He started his career in manufacturing and R&D at Borusan Mannessmann, where he gained operation experience early in his career. Mr. Yarkadas has a master's degree in Mechanical Engineering from Istanbul Technical University and an MBA from Imperial College London.
Catherine C. Maxey,Vice President—Public Affairs, Sustainability and Environment, Health and Safety. Ms. Maxey, 50, joined the Company as Vice President—Public Affairs and Business Intelligence in June 2010. Previously she held positions of increasing responsibility at The Dow Chemical Company, which she joined in 1988, most recently as Public Affairs director for Mergers & Acquisitions, Joint Ventures, Dow Portfolio Optimization/Divestitures and Manufacturing and Engineering from March 2009 until June 2010. Prior to that, she served as vice president of Public Affairs and Communications for K-Dow Petrochemicals, a planned JV that was later cancelled from June 2008 until March 2009 and Business Public Affairs Director for Performance Chemicals from 2003 to June 2008. Ms. Maxey received a bachelor's degree in Journalism/Science Writing from Lehigh University.
David P. Stasse, Vice President—Treasury and Corporate Finance. Mr. Stasse, 45, joined the Company in July 2013 as Vice President and Treasurer with responsibility for all treasury and investor relations matters, including cash management, risk management, relationships with rating agencies and commercial banks, and financing matters. Mr. Stasse joined the Company from Freescale Semiconductor, Inc., a global semiconductor manufacturer that serves the automotive, networking, consumer and industrial markets, wherethis role, he served as Vice President and Treasurer since July 2008,Business Unit Director for Schulman’s Custom Performance Colors business in EMEA. Mr. Schewe holds a degree as a State-Certified Engineer in Chemical Engineering from Fresenius Akademie Wiesbaden in Germany, and Assistant Treasureran Apprenticeship as a Chemical Laboratory Technician from August 2006RWTH Aachen in Germany.
Bernard M. Skeete, Vice President, Chief Accounting Officer and Global Controller. Mr. Skeete, age 50, joined Trinseo in October 2016 as Chief Audit Executive with responsibility for the Company’s internal audit and enterprise risk management functions. Previously, Mr. Skeete served as Executive Director of Financial Operations at Comcast Cable from April 2015 to July 2008.October 2016. Prior to that,joining Comcast, Mr. StasseSkeete held various positions in corporate audit, controllers and financial planning and analysis with the Campbell Soup Company, with his last position being a Senior Manager of Financial Planning & Analysis for Supply Chain. Mr. Skeete began his career at PricewaterhouseCoopers, where he practiced for over eleven years, most recently as Senior Manager of Assurance & Business Advisory Services. Mr. Skeete holds a bachelor’s degree in accounting from St. Joseph’s University and is a Certified Public Accountant and Chartered Global Management Accountant.
Timothy J. Thomas,Senior Vice President, Manufacturing and Operations Excellence. Mr. Thomas, age 56, has been with the Company since its inception and has previously held positions of increasing responsibility related to the Company’s manufacturing operations, including Global Business Manufacturing Leader—Latex and Operations Director—Performance Materials. In October 2019, Mr. Thomas was named Vice President—Manufacturing and Operational Excellence. Prior to joining Trinseo, Mr. Thomas served in various roles at The Dow Chemical Company, most recently as Business Manufacturing leader for Latex Binders. Mr. Thomas holds a bachelor’s degree in Chemical Engineering from Youngstown State University.
Bregje Roseboom-Van Kessel,Senior Vice President, Plastics Solutions. Ms. van Kessel, age 46, was appointed Senior Vice President, Base Plastics in November 2022 and is responsible for all commercial activities for the Base Plastics business. Ms. van Kessel joined Trinseo in 2018 and previously served as First Vice President, Debt Capital MarketsSenior Director, Global Business Finance, where she led the business finance organization for all of MBNA CorporationTrinseo’s external reporting segments. Ms. van Kessel brings over 20 years of experience in business finance and as Treasury Manager of SPX Corporation. Mr. Stasse alsochange management and has held numerouskey financial positions from 1998 to 2004 at Honeywell International, last serving as Director, Corporate Finance. Mr. Stasseleadership roles supporting global sales and marketing, supply chain, R&D and brand development for global markets. Ms. van Kessel holds a master’s degree in medicine and an executive MBA in Financefinance and control from the University of MarylandMaastricht University. She is a registered controller and a Bachelormember of Science degreethe Chartered Institute of Management Accountants.
2023 Proxy Statement 24
Our Company’s Executive Officers
Diversity of Executive Officers
Similar to our Board diversity, the Company believes a broad range of backgrounds and personal experience help the Company operate, strategize and solve problems more effectively. We believe our executive officers reflect this diversity of viewpoints and backgrounds. Four of our executive officers are women, two self-identify as a member of an underrepresented minority group, and eight are non-U.S. citizens.
Charts do not include our CEO and President, Frank Bozich, who is reflected in
Business Logistics from Penn State University.the Board diversity discussion.
25 2023 Proxy Statement
Transactions with Related Persons
Transactions with Related Persons
Certain Relationships and Related Transactions Our Conflict of Interest Policy is designed to help our directors, executive officers, and employees address situations that may involve a conflict of interest, which may include related party transactions. These include situations in which an individual'sindividual’s personal interests are in conflict with the interests of the Company; situations in which an individual or family member receives personal benefits as a result of his or her position with the Company; and situations that may otherwise cast doubt on his or her ability to act objectively with or on behalf of the Company. The Company annually surveys our executive officers and directors regarding potential conflicts of interest. If such conflicts are reported or found, the Legal Department and/or our Chief Compliance Officer will seek to mitigate or eliminate such potential or actual conflictconflicts of interest. Our audit committee charter requires that the audit committee review and approve all related party transactions. The Company also has a written Related Party Transactions Policy. When related party transactions between us and our officers, directors and principal shareholders and their affiliates, are approved by the audit committee, it does so with the understanding that the terms of such transaction are no less favorable to us than those that we could obtain from unaffiliated third parties.
2023 Proxy Statement 26
TABLE OF CONTENTSTable of ContentsShare Repurchase
On March 24, 2016, our Parent, Bain Capital Everest Management SCA, sold an aggregate of 10,600,000 of our ordinary shares in a registered, underwritten public offering to Goldman, Sachs & Co. (the "Underwriter"). Concurrent with that offering, the Company repurchased a total of 1,600,000 of our ordinary shares from the Underwriter at a price of $35.63 per share, the same price per share paid by the Underwriter. As a result of the share repurchase, our Parent received approximately $57,008,000 in proceeds from the Company. Five of our directors, Messrs. Zide, Thomas, Plantevin, Hauser, and Vasseur are affiliated with Bain Capital. Therefore, the decision to repurchase 1,600,000 of our shares at $35.63 was delegated to a committee of disinterested directors consisting of our audit committee members.
STOCK OWNERSHIP INFORMATION
Stock Ownership Information
Stock Ownership Information
The following table sets forth information regarding the beneficial ownership of our ordinary shares, nominal value $0.01, as of March 25, 201631, 2023 by: •
each person or group of affiliated persons known by us to be the beneficial owner of more than 5% of our ordinary shares;
•
each of our named executive officers, directors and director nomineesnominees; and directors; and
•
all of our directors, director nominees and named executive officers as a group.
As of March 25, 2016,31, 2023, we had 47,177,93435,141,405 ordinary shares outstanding and our Parent had 3,864,167 ordinary shares outstanding. As(excluding treasury shares), all of March 25, 2016, 26,669,567 of our outstanding ordinary shares were held by our Parent, and 20,508,367which were held by public investors (including certain of our Directordirectors and Executive Officers)executive officers), the details of which are reflected in the table below. Information with respect to beneficial ownership has been furnished by each director, director nominee, executive officer or beneficial owner of more than 5% of our ordinary shares. We have determined beneficial ownership in accordance with SEC rules. These rules generally attribute beneficial ownership of shares to persons who possess sole or shared voting or investment power with respect to such shares. The information does not necessarily indicate beneficial ownership for any other purpose. Under these rules, the number of shares of ordinary shares deemed outstanding includes shares issuable upon exercise of options and held by the respective person or group which may be exercised or converted within 60 days after March 25, 2016.31, 2023. These shares are deemed to be outstanding and beneficially owned by the person holding those options for the purpose of computing the percentage ownership of that person or entity, but they are not treated as outstanding for the purpose of computing the percentage ownership of any other person or entity. Unless otherwise indicated below, the address for each listed director, director nominee, officer and shareholder is c/o Trinseo S.A., 1000 Chesterbrook Boulevard, Suite 300, Berwyn, Pennsylvania 19312.
The inclusion in the following table of those shares, however, does not constitute an admission that the named shareholder is a direct or indirect beneficial owner. Unless otherwise indicated and subject to applicable community property laws, to our knowledge, each shareholder named in the following table possesses sole voting and investment power over the shares listed, except for those jointly owned with that person'sperson’s spouse.
| | Name | | | Total
Number of Shares
Beneficially Owned | | | Percent
of Class (1) | | | Of Number of Shares Beneficially
Owned, Shares which May be
Acquired within 60 Days (2) | |
| | M&G Investment Management Limited (3) | | | | | 7,625,044 | | | | | | 21.7% | | | | | | — | | |
| | BlackRock, Inc. (4) | | | | | 5,811,878 | | | | | | 16.5% | | | | | | — | | |
| | Frank A. Bozich | | | | | 243,777 | | | | | | * | | | | | | 144,105 | | |
| | David Stasse | | | | | 87,813 | | | | | | * | | | | | | 45,840 | | |
| | Angelo N. Chaclas | | | | | 102,308 | | | | | | * | | | | | | 69,152 | | |
| | Andre Lanning | | | | | 15,894 | | | | | | * | | | | | | 12,289 | | |
| | Paula Cooney | | | | | 3,993 | | | | | | * | | | | | | 2,644 | | |
| | Joseph Alvarado | | | | | 13,512 | | | | | | * | | | | | | — | | |
| | Victoria Brifo | | | | | 1,175 | | | | | | * | | | | | | — | | |
| | Jeffrey J. Cote | | | | | 26,934 | | | | | | * | | | | | | — | | |
| | Pierre-Marie De Leener | | | | | 8,920 | | | | | | * | | | | | | — | | |
| | Jeanmarie Desmond | | | | | 5,332 | | | | | | * | | | | | | — | | |
| | Matthew Farrell | | | | | 18,175 | | | | | | * | | | | | | — | | |
| | K’Lynne Johnson | | | | | 9,952 | | | | | | * | | | | | | — | | |
| | Sandra Beach Lin | | | | | 6,116 | | | | | | * | | | | | | — | | |
| | Philip R. Martens | | | | | 7,117 | | | | | | * | | | | | | — | | |
| | Donald T. Misheff | | | | | 17,370 | | | | | | * | | | | | | — | | |
| | Henri Steinmetz | | | | | 26,199 | | | | | | * | | | | | | — | | |
| | Mark Tomkins | | | | | 8,902 | | | | | | * | | | | | | — | | |
| | All Directors, Nominees and Executive Officers as a Group
(27 persons) (5) | | | | | 762,238 | | | | | | 2.5% | | | | | | 391,363 | | |
| | | | | | | |
Name | | Number of
Shares of
Company | | Percentage | |
|---|
Parent | | | | | | | |
Bain Capital Everest Manager Holding SCA ("Parent")(1) | | | 26,669,567 | | | 56.5 | % |
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| | | | | | | | | | | | | |
Name | | Number of
Shares of
Company | | Percentage | | Number of
Shares of
Parent | | Percentage | |
|---|
Management | | | | | | | | | | | | | |
Christopher D. Pappas(2) | | | 100,797 | | | * | | | 121,190 | | | 3.1 | % |
John A. Feenan(3) | | | — | | | * | | | 13,941 | | | * | |
Martin Pugh(4) | | | 25,314 | | | * | | | 5,422 | | | * | |
Marilyn N. Horner(5) | | | 11,803 | | | * | | | 11,591 | | | * | |
Angelo N. Chaclas (6) | | | 7,890 | | | * | | | — | | | — | |
Jeffrey J. Cote | | | 9,578 | | | * | | | — | | | — | |
Pierre-Marie De Leener | | | 13,789 | | | * | | | — | | | — | |
Felix Hauser(7) | | | — | | | — | | | — | | | — | |
Donald T. Misheff | | | — | | | — | | | — | | | — | |
Michel G. Plantevin(7) | | | — | | | — | | | — | | | — | |
Stephen Thomas(7) | | | — | | | — | | | — | | | — | |
Aurélien Vasseur(7) | | | — | | | — | | | — | | | — | |
Stephen M. Zide(7) | | | — | | | — | | | — | | | — | |
All Directors, Nominees and Executive Officers as a Group (19 persons)(8) | | | 194,686 | | | * | | | 164,549 | | | 4.3 | % |
*- Indicates less than one percent.
(1)
The general partnerownership percentages set forth in this column are based on the Company’s outstanding ordinary shares (excluding treasury shares) as of March 31, 2023 and assume that each of the beneficial owners continued to own the number of shares reflected in the table on such date.
(2)
Includes options to purchase ordinary shares which have vested or will vest within 60 days of March 31, 2023.
27 2023 Proxy Statement
Stock Ownership Information
(3)
On August 12, 2022 M&G Investment Management Limited (“M&G”) filed a Schedule 13D with the SEC reporting beneficial ownership of 7,625,044 of our Parentordinary shares, with sole voting power and sole dispositive power over such shares. In a Form 4 filed by M&G dated March 11, 2022, M&G reported beneficial ownership of 7,628,044 shares, which number is Bain Capital Everest Manager S.à.r.l. ("BCEM"). By virtueused in the table. The address of M&G is 10 Fenchurch Avenue, London, UK EC3M 5AG.
(4)
On January 23, 2023, BlackRock, Inc. filed a Schedule 13G/A with the relationships described in this footnote, BCEM may be deemed to exerciseSEC reporting beneficial ownership of 5,811,878 of our ordinary shares as of December 31, 2022 with sole voting power over 5,744,384 shares and sole dispositive power over 5,811,878 shares. The address of BlackRock, Inc. is 55 East 52nd Street, New York, NY 10055.
(5)
Includes 6,808 restricted stock units that will vest and 384,555 options to purchase ordinary shares which have vested, or will vest, within 60 days of March 31, 2023.
2023 Proxy Statement 28
Securities Authorized for Issuance under Equity Compensation Plans / Delinquent Section 16(a) Reports
Securities Authorized for Issuance under Equity Compensation Plans
The following table sets forth certain information as of December 31, 2022 with respect to the shares held by Parent. Michel G. Plantevin, Aurélien Vasseur, Christopher D. Pappas, Stephen Thomas, Felix Hauser, and Stephen M. Zide are each managers of BCEM. The managers of BCEM disclaim beneficial ownership of such shares to the extent attributed to them solely by virtue of serving as a manager of BCEM. All of the outstanding share capital of BCEM is held by Bain Capital Europe Fund III, L.P. ("Europe Fund III") and, in that capacity, Europe Fund III has the power to appoint the managers of BCEM. Bain Capital Investors, LLC ("BCI") is the general partner of Bain Capital Partners Europe III, L.P.,compensation plans under which is the general partner of Europe Fund III. As a result of the relationships described above, BCI may be deemed to share beneficial ownership of the shares held by our Parent. The governance, investment strategy and decision-making process with respect to investments held by Europe Fund III is directed by BCI's Global Private Equity Board ("GPEB"), which is comprised of the following individuals: Steven Barnes, Joshua Bekenstein, John Connaughton, David Gross-Loh, Stephen Pagliuca, Michel G. Plantevin, Dwight Poler, and Jonathan Zhu. By virtue of the relationships described in this footnote, GPEB may be deemed to exercise voting and dispositive power with respect to the shares held by our Parent. Each of the members of GPEB disclaims beneficial ownership of such shares to the extent attributed to such member solely by virtue of serving on GPEB. The address for our Parent and BCEM is 4, rue Lou Hemmer, L-1748 Luxembourg, Grand Duchy of Luxembourg. Europe Fund III has an address of Ugland House, South Church Street, George Town, Grand Cayman, KY1-1104 Cayman Islands and BCI has an address c/o Bain Capital Partners, LP, 200 Clarendon Street, Boston, Massachusetts 02116. The address of Mr. Hauser is c/o Bain Capital Beteiligungsberatung GmbH Maximilianstrasse 11, 80539 Munich, Germany.
(2)The number of shares of the Parent does not include 20,000,000 preferred equity certificates of our Parent, or PECs, which are not convertible into ordinary shares of our Parent, held by Mr. Pappas and which represent less than 1% of all outstanding PECs. The number of shares of the Company includes 90,797 vested options.may be issued.
| | Plan Category | | | Number of securities
to be issued upon
exercise of
outstanding options,
warrants and rights
(a) | | | Weighted-average
exercise price of
outstanding options,
warrants and rights
(b) | | | Number of securities
remaining available
for future issuance
under equity
compensation plans
(excluding securities
reflected in column (a))
(c) | |
| | Equity compensation plans approved by securityholders | | | | | 2,086,885 (1) | | | | | | 51.99 (2) | | | | | | 1,657,226 | | |
| | Equity compensation plans not approved by
securityholders | | | | | — | | | | | | — | | | | | | — | | |
| | Total | | | | | 2,086,885 | | | | | | 51.99 | | | | | | 1,657,226 | | |
(1)
TableIncludes 573,862 restricted stock units, 183,340 performance award stock units, and 1,329,683 options to purchase shares that have been granted under the approved Trinseo PLC Amended & Restated 2014 Omnibus Incentive Plan and remain outstanding as of Contents(3)- December 31, 2022. The
numberrestricted stock units and performance stock units will result in the issuance of shares immediately upon vesting, with the vesting of performance stock units subject to the Company’s attainment of pre-established performance goals. The options to purchase shares will result in the issuance of shares upon exercise.
(2)
Represents the weighted-average exercise price of the Parent doesabove-mentioned options to purchase shares only. The Company’s performance award stock units and restricted stock units do not include 50,000,000 PECs held by Mr. Feenan, which represent approximately 1% of all outstanding PECs.
(4)The number of shares of the Company includes 19,314 vested options.
(5)The number of shares of the Parent does not include 7,500,000 PECs held by Ms. Horner, which represent less than 1% of all outstanding PECs. The number of shares of the Company includes 11,803 vested options.
(6)The number of shares of the Company consists of 7,890 vested options.
(7)The number of shares does not include shares held by our Parent. Mr. Plantevin is a member of GPEB. Mr. Zide is a Senior Advisor of BCI and a member of GPEB. Mr. Thomas is a Managing Director of BCI. Mr. Vasseur is a corporate manager of BCI. As a result and by virtue of the relationships described in footnote 1 above, each of Messrs. Hauser, Plantevin, Zide, Thomas, and Vasseur may be deemed to share beneficial ownership of the shares held by Parent. The address for Messrs. Zide and Thomas is c/o Bain Capital Partners, LP, 200 Clarendon Street, Boston, Massachusetts 02116. The address for Mr. Plantevin is c/o Bain Capital Europe, LLP, Devonshire House, Mayfair Place, London W1J 8AJ, United Kingdom. The address for Mr. Vasseur is c/o Bain Capital Luxembourg S.à.r.l., 4 rue Lou Hemmer, L-1748 Luxembourg, Grand Duchy of Luxembourg.
(8)The number of shares of the Parent included in the table does not include an aggregate of 88,500,000 PECs held by our directors and executive officers.have associated exercise prices.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Delinquent Section 16(a) Reports
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our directors and executive officers, among others, to file with the SEC an initial report of ownership of our stock on a Form 3 and reports of changes in ownership on a Form 4 or a Form 5. Persons subject to Section 16 are required by SEC regulations to furnish us with copies of all Section 16(a) forms that they file. Under SEC rules, certain forms of indirect ownership and ownership of company stock by certain family members are covered by these reporting requirements. When requested, we assist our executive officers and directors in preparing initial ownership reports and reporting ownership changes and will file these reports on their behalf. Based solely on a review of the copies of such forms in our possession, and on written representations from our current directors and executive officers, we believe
that all of our executive officers and directors filed the required reports on a timely basis under Section 16(a) during
2015.
Table2022, with the exception of Contents
a late Form 4 filed by Paula Cooney on December 12, 2022 to report shares withheld for taxes on November 29, 2022.
29 2023 Proxy Statement
Proposal 2—Advisory Vote on Named Executive Officer Compensation
The Compensation Discussion and Analysis beginning on page 22 of this Proxy Statement, which immediately follows this proposal, describes our executive compensation program and the compensation of our named executive officers for fiscal 2015.2022. The Board is asking shareholders to cast a non-binding, advisory vote indicating their approval of that compensation by voting FOR the following resolution: "RESOLVED,
“RESOLVED, that the shareholders of Trinseo S.A.PLC APPROVE, on an advisory basis, the compensation paid to its named executive officers, as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, compensation tables and narrative discussion."”
As described in detail in the Compensation Discussion and Analysis, we have a total compensation approach focused on performance-based incentive compensation that seeks to: •
Attract and retain industry-leading talent;
talent
•
Link compensation actually paid to achievement of our financial, operating and strategic goals;
•
Reward individual performance and contribution to our success; and
•
Use performance measures, including financial and non-financial goals that align our named executive officers'officers’ interests with those of our shareholders.
We believe Trinseo's performance demonstrates the effectivenessTrinseo’s executive compensation program employs positive governance practices and offer substantial levels of at-risk compensation to meaningfully align shareholder interests with those of our compensation program.named executive officers.
The Board is asking shareholders to support this
proposal.proposal, as it does annually. Although the vote we are asking you to cast is non-binding, the compensation committee and the Board value the views of our shareholders as expressed in their votes. The Board and the compensation committee will consider the outcome of the vote when determining future compensation arrangements for our named executive officers.
YOUR
| | | THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR”
THE ADVISORY VOTE ON NAMED EXECUTIVE OFFICER COMPENSATION. | | |
2023 Proxy Statement 30
Compensation Discussion and Analysis
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COMPENSATION DISCUSSION AND ANALYSIS
Compensation Discussion and Analysis
This compensation discussion and analysis (CD&A) section is intended to provide information about our 20152022 compensation objectives and programs for our named executive officers. For 2015,officers, listed below (together, our named executive officers, or NEOs, were:“NEOs”).
| | Name | | | Position | |
Name
| | Position |
|---|
Christopher D. Pappas | Frank A. Bozich | | | President and Chief Executive Officer | |
John A. Feenan* | David Stasse | | | Executive Vice President and Chief Financial Officer | |
Martin Pugh** | | Executive Vice President and Chief Operating Officer |
Marilyn N. Horner | | Senior Vice President, Human Resources |
| Angelo N. Chaclas | | | Senior Vice President, Chief Legal Officer, &Chief Compliance Officer and Corporate Secretary | |
| | Andre Lanning | | | Senior Vice President and Chief Commercial Officer | |
| | Paula Cooney | | | Senior Vice President and Chief Human Resources Officer | |
*Mr. Feenan resigned from his officer position on November 18, 2015 and was employed in an advisory capacity with the Company through the end of 2015. Mr. Pappas is acting as the Interim Chief Financial Officer until Mr. Feenan's replacement has been identified.
**Effective November 1, 2015, Martin Pugh was promoted from Senior Vice President and Business President for Performance Materials to Executive Vice President and Chief Operating Officer.
This CD&A is divided into the following sections:
•
Executive Summary
•
Compensation Philosophy and Design
•
How We Make Compensation Decisions
•2015
2022 Compensation Structure & Performance
•
Other Compensation and Tax Matters
Business Achievements We hadPerformance
Our 2022 results reflected the challenging operating conditions we faced, including historically high energy prices, particularly in Europe, rapid rise in interest rates in an exceptional year with respect to the Company's business achievements, which include:•Delivering record net income of $133.6 millioninflationary environment, geopolitical uncertainty including war in Ukraine and Adjusted EBITDA of $410.0 million, excluding inventory revaluation and joint venture earnings, including continued strong results from our Performance Materials divisionCOVID-19 lockdowns in China, as well as record results fromfluctuations in raw material prices. These headwinds led to weaker demand and significant customer destocking during the second half of the year, as well as our Basic Plastics & Feedstocks division;
•Successfully rebrandingdecision to pause the proposed sale of our operating namestyrenics business due to deterioration of financing markets and legal entities from "Styron"the economic uncertainty created by the war in Ukraine, which impeded our ability to "Trinseo";
•Adding greater depthobtain full value for the styrenics business. Despite these headwinds, we finished the year with positive cash flow and $250 million in available liquidity under two undrawn, committed financing facilities and we also continued to return cash and value to our business leadership team withshareholders through dividends and share repurchases. Highlights for the hiringyear ended December 31, 2022:
•
Paid quarterly dividends of Tim Stedman as Senior Vice President$0.32 per share, totaling approximately $46.4 million.
•
Repurchased approximately 3,100,000 of our ordinary shares in open-market purchases for an aggregate purchase price of approximately $150 million.
•
Implemented an asset restructuring plan designed to reduce costs, improve profitability, reduce exposure to cyclical markets and Business President, Basic Plastics & Feedstockselevated natural gas prices, and Hayati Yarkadas, Senior Vice Presidentaddress market overcapacity, through closure of certain underperforming or uncompetitive plants and Business President, Performance Materials; and
•Refinancing our debt under a new capital structure that isproduct lines, which steps are expected to reducebe completed by the end of 2024, and initiated other actions to preserve cash through reductions in capital spending, operating expenses and working capital.
•
Acquired Heathland B.V., a leading collector and recycler of post-consumer and post-industrial plastic wastes in Europe, to improve progress toward enhancing our annual interest expensefootprint as a sustainable solutions provider.
Shareholder Approval of Executive Compensation
In 2022, the compensation of our named executive officers was approved by shareholders with approximately $37.0 million.Consideration98% of 2015 Advisory Votevotes cast in favor. Based on Executive Compensation
The compensation committee regularly reviews the philosophy, objectives and elementsthis shareholder support of our executive compensation programs, in relation to our short-we and long-term business objectives. As part of this review, the compensation committee considersbelieve our compensation program and practices are well aligned with our shareholders’ wishes. Our Board members, investor relations and legal function periodically engage with shareholders regarding the viewsstructure of shareholders as reflected in their
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annual advisory vote on our executive compensation proposal. At our 2015 annual general meeting of shareholders, our executive compensation proposal received overwhelming approval (approximately 96%). Based on the compensation committee's review and the support our executive compensation programs received from shareholders,and corporate governance, and we believe the continued strong shareholder support of our say-on-pay proposals indicates our practices accurately represent the desires of our shareholders. We consider insights obtained through shareholder engagement and the results of our annual advisory say-on-pay proposal to be critical components to the compensation committee’s design and oversight of the Company’s executive compensation programs.
During fiscal 2022, the compensation committee did not make significant changesof the Board reviewed our executive compensation peer group and concluded our peer group adequately aligned our executive officers’ pay opportunities with our compensation philosophy. The compensation committee also approved performance metrics for incentive pay that, consistent with prior years, were designed to itscorrelate with the way we
31 2023 Proxy Statement
Compensation Discussion and Analysis
evaluate our operational results and reflect measures of performance that drive returns for our stockholders. We will continue to evaluate opportunities to enhance our compensation programs.programs to attract top talent and provide further alignment with the interests of our shareholders.
Compensation Philosophy and Design
Our executive compensation policies and programs are designed to attract, retain and motivate key executives through competitive and cost effectivecost-effective programs that reinforce executive accountability and reward the achievement of business and individual results. Executive compensation consists of four main elements: (1) base salary, (2) annual cash incentive awards, (3) long-term incentive compensation, and (4) retirement savings and benefit programs. The relative weighting of each element is aligned with our philosophy of linking pay to performance. A substantial percentage of our executives'executives’ compensation is provided in the form of performance-based variable compensation with a greater emphasis on variable components for our senior executives. Annual cash awards are directly linked to corporate results and short-term performance measures, including financial and non-financial goals. Our equity incentive awards align our executives' interestexecutives’ interests with those of our shareholders and our long-term business objectives. Executive retirement and benefits programs are generally consistent with the broader employee programs offered in the country where an executive primarily provides services to the Company. We provide limited perquisites to our executives and senior management, and such perquisites are only provided to the extent that they reflect particular business needs and objectives. Our annual cash incentive plan is designed to create a pay-for-performance culture by aligning the compensation program to the achievement of our strategic and business objectives and with shareholder interests. Our business objectives are to: (1) deliver strong recurring profits relative to our industry; (2) effectively manage our working capital; (3) demonstrate effective cost management; (4) provide EBITDA growth that is stronger than the industry; and (5) provide a safe working environment.
We strive to provide our NEOs with a compensation package that is market competitive within our industry and recognizes and rewards superior individual and companyCompany performance.
The chartcharts below showsshow the 20152022 target mix of compensation between salary and short- and long-term incentive compensation for Mr. PappasBozich, and for our other NEOs as a group. Long-term incentive compensation remains the largest component of our NEOs’ compensation in order to incentivize long-term value creation and to provide continued alignment between the interests of our NEOs and shareholders.
| | | |
CEO Target Compensation | | Average Target Compensation
for All Other NEOS* |
|
|
|
 | |
|
*This target excludes additional cash incentives payable to Mr. Chaclas2023 Proxy Statement 32
Compensation Discussion and described below in "—Additional Incentives to Mr. Chaclas".Analysis
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Maintaining Best Practices Regarding Executive Compensation Our compensation committee intends to compensate our NEOs effectively and consistentlyin a manner that is consistent with the objectives and design principles outlined above. We have adopted the following compensation practices, which are intended to promote strong corporate governance and alignment with shareholdershareholder’s interests:
Compensation Committee Practices
| | Clawback and Recoupment Policies | |
Independent Compensation Consultant
| | The compensation committee retains and annually reviews the independence of its compensation consultant. |
Risk Assessment
| | The compensation committee regularly assesses whether our incentive compensation arrangements encourage excessive risk-taking to ensure that our plans and awards are designed and working in a way to not encourage excessive risk taking.
|
Compensation at Risk
| | We grant a high percentage of at-risk compensation. We believe this is essential to creating a culture of pay-for-performance.
|
Mitigate Undue Risk
| | We mitigate undue risk in our compensation program by instituting governance policies such as capping potential payments, utilizing multiple performance metrics, striking a balance between short- and long-term incentives and adopting share ownership requirements.
|
Share Ownership Guidelines
| | The compensation committee has adopted share ownership guidelines (i) equal to six times base salary for the CEO, and (ii) equal to two times base salary for our other NEOs.
|
Clawback Requirements
| | We have the right to seek recoupmentclaw back incentive-based compensation to the extent it was awarded on the achievement of financial results subject to an accounting restatement that should have resulted in the executive receiving a lower amount of compensation had our financial results been properly reported. The Board can recoup this compensation by requiring the reimbursement of compensation previously paid, cancelling outstanding vested or unvested equity awards, or taking any other action permitted by law. Our equity award agreements also provide for the reimbursement of all or part of any 2015 annual incentive compensation if there is a breach by the executive of his or her award agreement or any non-competition, non-solicitation, confidentiality or similar covenant or agreement with us or an overpayment of incentive compensation due to inaccurate financial data. Our
| |
| | Share Ownership Guidelines | | | The compensation committee also may recover any award or payments under any awardhas adopted share ownership guidelines equal to (i) six times base salary for the CEO, and (ii) two times base salary for our other NEOs. The guideline must be achieved by 5 years from the date of hire for newly hired executives. Due to a decline in accordancestock price, Mr. Chaclas was not in compliance with anythe share ownership guidelines as of December 31, 2022. All other executives to whom the share ownership guidelines apply were in compliance at year-end. Under our stock ownership guidelines, a failure to meet the guidelines due to a decline in stock price is not deemed a breach if the employee met the guidelines in the prior year. Until the ownership requirement is met, the executive must retain as a holding requirement: (i) 50% of the shares issued after vesting and settlement of restricted stock units (“RSUs”) (net of all applicable company clawback or recoupment policy, or as otherwise required bytaxes), (ii) 50% of the shares issued following the exercise of a stock option (after satisfaction of the option exercise price and net of applicable law ortaxes), and (iii) 50% of the shares issued after vesting and settlement of performance stock units (“PSUs”) (net of all applicable stock exchange listing standards.taxes). | |
| Mitigate Undue Risk and Risk Assessment | | | The compensation committee regularly assesses whether our compensation programs and arrangements for our employees encourage excessive risk-taking. We mitigate undue risk in our compensation program by instituting strong governance policies such as capping potential payments, utilizing multiple performance metrics, striking a balance between short- and long-term incentives and adopting share ownership requirements. | |
| | Compensation at Risk | | | We grant a high percentage of at-risk compensation to our executive officers. We believe this is essential to creating a culture of pay-for-performance. | |
| | Double-Trigger Change-in-Control Provisions | | | Our executive officers only receive change-in-control benefits under their equity awards or their employment agreements if their employment is also terminated without cause (or by the executive for good reason) within a specified period following a change in control. | |
| | No 280G Gross-Up Provisions | | | The compensation committee does not permit 280G gross-up provisions in the Company’s executive employment agreements and amendments. | |
| | Anti-Hedging and Pledging Policy | | | We prohibit our directors, executive officers, and all employees from hedging or pledging the Company'sCompany’s securities. | |
| | Independent Compensation Consultant | | | The compensation committee retains and annually reviews the independence of its compensation consultant. | |
33 2023 Proxy Statement
Compensation Discussion and Analysis
How We Make Compensation Decisions Our compensation committee is responsible for, among other matters: (1) reviewing key executive compensation goals, policies, plans and programs; (2) reviewing the compensation of our executive officers; (3) reviewing and approving employment agreements and other similar arrangements between the Company and our executive officers; and (4) administering our equity-based plans and other incentive compensation plans.
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Our Chief Executive Officer and President reviews annually with the compensation committee each NEO'sNEO’s performance (other than his own) and recommends to the compensation committee appropriate base salary, annual cash incentive awards and long-term equity incentive awards (to the extent applicable with respect to a particular year) for these NEOs. Based upon the recommendations of our Chief Executive Officer and in considerationPresident, and after considering the objectives of certain objectives and philosophiesour executive compensation program, as described above, as well as the factors described below under “Use of Benchmarking Comparison Data”, the compensation committee makesapproved the final recommendation to the Board for annual compensation packages of our executive officers. With respect to our Chief Executive Officer,In 2022, the compensation committee and/or the Board reviews annually his performance and thealso approved Mr. Bozich’s compensation, committee recommends to the Boardincluding his base salary, annual cash incentive awards and grants ofaward, long-term equity incentive awards based on the compensation committee's assessmentawards. See “—Narrative Disclosure to Summary Compensation Table and Grants of his performance, as approved by the Board.
Plan Based Awards Table; Other Narrative Disclosure” for a description of each NEO’s employment agreement terms.
In making decisions with respect to any element of an NEO'sNEO’s compensation, the compensation committee considered the total compensation that may be awarded to the executive, including salary, annual cash incentive awards and long-term incentive compensation. In addition, in reviewing and approving employment agreements for our NEOs, the compensation committee considered the other benefits to which the officer is entitled by the agreement, including compensation payable upon termination of the executive'sexecutive’s employment under a variety of circumstances. Our goal is to award compensation that is competitive to attract and retain highly qualified leaders and that motivates them to drive strong business performance. We believe that our compensation programs align executive and shareholder interests, while allowing compensation to vary based on each executive'sexecutive’s individual contributions to the Company and to the Company'sCompany’s overall performance.
Use of Benchmarking Comparison Data In 2014, the compensation committee selected a peer group of companies, with assistance from Willis Towers Watson, for use in making 2015 compensation decisions, with respect to the total mix and amount of compensation. This peer group consists of companies in the chemical and chemical-related industries, as well as companies in the construction, container and packaging and paper and forest product industries. The compensation committee reviewed various market-based metrics of the peer group that it deemed appropriate, which included enterprise value, revenue, market capitalization, and EBITA margins.
The compensation committee may annually review the companies included in our peer group and may add or eliminate companies as it determines to be appropriate. The peer group selected for making fiscal 2015 compensation decisions consisted of the following 24 companies:
| | | | |
A. Schulman, Inc. | | Eastman Chemical Company | | PolyOne Corporation |
Axiall Corporation | | Ferro Corporation | | Resolute Forest Products Inc. |
Berry Plastics Group, Inc. | | Graphic Packaging Holding Company | | Rockwood Holdings, Inc.(1) |
Boise Cascade Company | | Greif, Inc. | | RPM International Inc. |
Cabot Corporation | | HB Fuller Company | | Silgan Holdings Inc. |
Celanese Corporation | | Kraton Performance Polymers, Inc. | | Stepan Company |
Chemtura Corporation | | Olin Corporation | | Taminco Corporation(2) |
Domtar Corporation | | OMNOVA Solutions Inc. | | Tronox Limited |
Independent Compensation Consultant(1)Acquired by Albemarle Corporation in January 2015.
(2)Acquired by Eastman Chemical Company in December 2014.
The compensation committee has retained Willis Towers Watson as its independent compensation consultant. Willis Towers Watson a globally recognized as a leader in compensation and benefits
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advisory services, provides the compensation committee with advice on a broad range of executive compensation matters. The scope of their services includes, but is not limited to, the following:
•
Apprising the compensation committee of compensation-related trends and developments in the marketplace;
•
Informing the compensation committee of regulatory developments relating to executive compensation practices;
•
Providing the compensation committee with an assessment of the market competitiveness of the Company'sCompany’s executive compensation;
•
Assessing the composition of the peer companies used for comparative purposes;
•
Assessing the executive compensation structure to confirm that no design elements encourage excessive risk taking;
and
•Assessing the relationship between executive compensation and corporate performance; and
•
Identifying potential changes to the executive compensation program to maintain competitiveness and ensure consistency with business strategies, good governance practices and alignment with shareholder interests.
During fiscal 2015,2022, Willis Towers Watson attended all but one of the regularly scheduled meetings of the compensation committee. In addition to providing the compensation committee with these executive compensation consulting services in 2015,2022 for which it received aggregate fees of $152,183,$265,000, Willis Towers Watson also provided the Company with the following additional services for which it received fees totaling $328,471:$1.04 million: support with the proposed styrenics divestiture, including retirement plan valuations; support for the Company’s asset restructuring initiatives, including special event retirement plan accounting; international actuarial support for the Company's pension and postretirement benefit plans; actuarial support for one of the Company's domestic welfare benefit plans;U.S. benefits; and compensation support to management.health and benefits brokering services. Before Willis Towers Watson undertook any compensation support work for the Company'sCompany’s management, the compensation committee was consulted and approved the scope of work. The compensation committee actively considered the range of the additional services that Willis Towers Watson was already providing to the Company when it made the decision to retain Willis Towers Watson as its independent compensation consultant in 2015.2022. The compensation committee assessed the independence of Willis Towers Watson pursuant to applicable SEC rules and concluded that no conflict of interest exists that would prevent Willis Towers Watson from independently representing the compensation committee.2015
Use of Benchmarking Comparison Data
The compensation committee selects a peer group of companies, with assistance from Willis Towers Watson, for use in making compensation decisions with respect to the total mix and amount of compensation. This peer group consists of companies in the chemical and chemical-related industries, as well as companies in the container and packaging and the paper packaging industries. The compensation committee reviewed various market-based metrics of the peer group that it deemed appropriate, which included enterprise value, revenue, market capitalization, and EBITDA margins, to establish compensation benchmarks.
2023 Proxy Statement 34
Compensation Discussion and Analysis
The compensation committee may annually review the companies included in our peer group and may add or eliminate companies as it determines is appropriate. For 2022, the compensation committee maintained the same peer group as the previous year, but removed two companies which were no longer publicly traded. The peer group selected for making fiscal 2022 compensation decisions consisted of the following 18 companies:
| | Ashland Global Holdings Inc. | | | H.B. Fuller Company | | | RPM International Inc. | |
| | Avient Corporation | | | Kraton Corporation | | | Silgan Holdings Inc. | |
| | Cabot Corporation | | | Methanex Corporation | | | Stepan Company | |
| | Element Solutions Inc | | | Minerals Technologies Inc. | | | Tronox Holdings plc | |
| | Graphic Packaging Holding Company | | | NewMarket Corporation | | | Valvoline Inc. | |
| | Greif, Inc. | | | Olin Corporation | | | Venator Materials PLC | |
Additionally, the compensation committee reviewed data from Willis Towers Watson to supplement data from the peer group. This data allowed the compensation committee to obtain a broader understanding of market compensation levels.
2022 Compensation Structure & Performance The principal components of our executive compensation program include both short-term and long-term compensation. Short-term compensation consists of an executive'sexecutive’s annual base salary and annual cash incentive award. Long-term compensation may includegenerally includes grants of share-based incentives as determined by the compensation committee and approved by the Board.committee. Certain elements of compensation of our NEOs were determined through direct negotiation with the executives at the time of their hiring.
Setting appropriate levels of base pay allows us to attract and retain an executive leadership team that will continue to meet our commitments to customers, sustain profitable growth and create value for our shareholders. The base salaries for our NEOs wereare determined based on the scope of their responsibilities competitive benchmarking, and our compensation committee members'members’ collective knowledge of competitive compensation levels.levels, as well as competitive compensation benchmarking data from Willis Towers Watson based on our peer group and survey data. Base salaries are reviewed annually by the compensation
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committee and adjusted from time to time to reflect individual responsibilities, performance and experience, as well as market compensation levels.
In 2015, Mr. Pappas received2022 the compensation committee approved salary increases to certain of our NEO’s base salaries. Messrs. Bozich, Stasse, Chaclas and Lanning were granted an incremental increase to their base salaries of 5% effective January 1, 2015. In connection with his promotion to Senior Vice President, Chief Legal Officer,2.4%, 5.8%, 5.4% and Corporate Secretary, Mr. Chaclas'4.4%, respectively, for 2022. Under the terms of her employment agreement, dated October 15, 2021, Ms. Cooney’s base salary was raised to $365,000 effective January 1, 2015. In connection with his promotion to Executive Vice President and Chief Operating Officer, Mr. Pugh's base salary was raised to 600,000 Swiss Francs (CHF) effective November 1, 2015.$500,000 for 2022.
Annual Cash Incentive Plan We have an
Our annual cash incentive plan that(“ACI Plan”) is designed to serve ascreate a pay for performance culture by aligning the compensation program to the achievement of our strategic and business objectives and with shareholder interests. Our business objectives are to: (1) provide a safe working environment by meeting or exceeding our metrics for injuries, loss of primary containment, and process safety incidents, and demonstrating progress on Sustainability goals; (2) generate strong free cash flow and Adjusted EBITDA results relative to our industry; (3) implement Trinseo’s strategy to transform into a materials-enabled solutions provider; (4) promote Company culture, talent development, recruitment and retention. The actual amount that will be paid in respect of an incentive to drive annual financial and non-financial performance. Annual cash incentive awards areACI Plan award is based on a combination of the achievement of Company performance goals as well as individual performance. The performance goals and metrics are recommendedreviewed and approved by the compensation committee to the Board at the beginning of the year. At the end of the year, the amount paid to each NEO is based on the achievement of the Company performance goals and an assessment of the executive'sexecutive’s overall performance. For 2015,2022, the annual cash incentive planACI Plan was designed to align our executives'executives’ compensation with the Company'sCompany’s business plan and priorities for the year, and reward performance based on the following three components: •
Financial Performance: measured by Company Adjusted EBITDA, adjusted as described below;
•
Responsible Care®: Injuries, Spills and Process Safety Incidents (PSIs);
Incidents; and
•EBITDA: Adjusted as described below; and
•
Individual Goals: Performance against defined business/functional and individual goals. We believe best-in-class environmental, health and safety metrics, as well as individual performance, are important measures for establishing performance objectives and measuring the performance of our NEOs. We are a Responsible Care® company and our environment, health and safety policy states that protecting people and the environment is part of everything we do and every decision we make. Each employee has a responsibility to ensure that our products and operations meet applicable government and Company standards.
The 2015 annual cash incentive plan includes three key environment, health and safety metrics that we track for our Company—Recordable Injuries as defined by OSHA, Process Safety Incidents as defined by the American Chemistry Council, and Loss of Primary Containment defined as any physical device used to contain a chemical or plastic resin as part of our manufacturing processes. Incentive payouts with respect to these metrics are determined based on our achievement rating for Responsible Care® performance and in accordance with the threshold, target and maximum levels set forth in the preceding table.
In 2015, Company financial performance metrics were based on an Adjusted EBITDA target of $283.0 million and threshold EBITDA of $253.0 million (in each case, excluding earnings from joint venture companies of $140.2 million and including an adjustment of $58.3 million to reflect current cost of raw materials).
We believe that Adjusted EBITDA is a key measure of our financial performance, removing the impacts of our capital structure (such as interest expense), asset base (such as depreciation and amortization) and tax structure as well as other non-recurring items. Therefore, for purposes of the annual cash incentive plan, we define Adjusted EBITDA, which is considered a non-GAAP measure, as net income (loss) from continuing operations before interest expense, net;net provision for income tax provision;taxes; depreciation and amortization expense; asset impairment charges; loss on extinguishment of long-term debt, net gain (loss)debt; asset impairment charges; gains or losses on the disposition of businesses and assets, restructuring charges; acquisition related costs and benefits, and other non-recurring items. Our Adjusted EBITDA performance target metric for the 2015 annual cash incentive2022 ACI Plan awards iswas set consistent to our 20152022 business plan that was approved by the Board, but is also adjusted to exclude earnings results
35 2023 Proxy Statement
Compensation Discussion and Analysis
from joint venture companiesthe Company’s American Styrenics segment and its Feedstocks segment, and to exclude the effects of inventory revaluation.
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We exclude inventory revaluation in order to facilitate the comparability of results from period to period, by adjusting cost of sales to reflect the cost of raw materials during the period, which is often referred to as the replacement cost method of inventory valuation. We believe this measure minimizes the impactimpacts of raw material purchasetiming. As in prior years, we exclude the earnings of our Americas Styrenics segment because as a joint venture the Company does not have direct control of its day-to-day operations. Additionally, we also exclude the earnings of our Feedstocks segment and the impacts of raw material timing because market volatility within this segment and timing impacts are generally outside of our executives’ control but can have a significant positive or negative impact on the Company’s financial performance. In 2022, our results reflected the challenging operating conditions including historically high energy prices, rapid rise in interest rates, geopolitical uncertainty, and raw material price volatility, which led to weaker demand and significant customer destocking during the second half of the year. Despite these headwinds, we finished the year with positive cash flow and $250 million in evaluatingavailable liquidity under two undrawn, committed financing facilities and we also continued to return cash and value to our performance. shareholders through $46 million in dividend payments and $150 million in share repurchases. We also implemented an asset restructuring plan designed to reduce costs and improve profitability through closure of certain underperforming or uncompetitive plants and product lines. These headwinds impacted the Company’s Adjusted EBITDA results in comparison to our business plan expectations.
See "“Item 7—Management'sManagement’s Discussion and Analysis of Financial Condition and Results of Operations—Other ImportantNon-GAAP Performance Measures"” of our Annual Report on Form 10-K for the year ended December 31, 2022 for more information on our approach to calculating inventory revaluation.Adjusted EBITDA and a reconciliation to the comparable GAAP measure.
Industry-leading environmental, health and safety metrics, as well as individual performance, are important measures for establishing performance objectives and measuring the performance of our NEOs. We are a Responsible Care® company and our environmental, health and safety policy states that protecting people and the environment is part of everything we do and every decision we make. Each employee has a responsibility to ensure that our products and operations meet applicable government and Company standards.
As in previous years, the 2022 ACI Plan includes three key environment, health and safety metrics that we track for our Company—Recordable Injuries as defined by OSHA, Process Safety Incidents as defined by the American Chemistry Council, and Loss of Primary Containment, which defines a containment as any physical device used to contain a chemical or plastic resin as part of our manufacturing processes. Incentive payouts with respect to these metrics are determined based on our achievement rating for Responsible Care® performance and in accordance with the threshold, target and maximum levels set forth in the table below.
In addition, each NEO had individual performance goals that included, depending on the NEO: corporate Adjusted EBITDA; Free Cash Flow; capital spending; margins and profitability; strategic transformation; corporate development projects and integrations; organizational effectiveness; safety and sustainability; human capital management; and budget oversight. The results achieved against each of these individual goals were assessed by the CEO or the compensation committee and a percentage rating was assigned to each NEO.
The table below shows the weight and targets of the component metrics, along with the payout opportunity for the annual cash incentive plan.ACI Plan.
| | Performance Goal | | | Weight of
Metric in
ACI Plan (%) | | | Threshold
Target | | | 100%
Performance
Target | | | Exceeds
Target | |
| | 1. Financial Performance | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 2022 Adjusted EBITDA Target (Per 2022 Business Plan) | | | | | 60% | | | | | $ | 530M | | | | | $ | 663M | | | | | $ | 796M | | |
| | 2. Responsible Care® | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Recordable Injuries* | | | | | 5% | | | | | | 11 | | | | | | 8 | | | | | | 5 | | |
| | Loss of Primary Containment* | | | | | 5% | | | | | | 8 | | | | | | 8 | | | | | | 5 | | |
| | Process Safety Incidents* | | | | | 5% | | | | | | 2 | | | | | | 1 | | | | | | 0 | | |
| | Responsible Care® Sub-total | | | | | 15% | | | | | | | | | | | | | | | | | | | | |
| | 3. Individual Goals | | | | | 25% | | | | | | | | | | | | | | | | | | | | |
| | Total Opportunity at Target | | | | | 100% | | | | | | | | | | | | | | | | | | | | |
| | Maximum Opportunity | | | | | 200% | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | Weight | | Threshold | | Level of
Performance
Target | | Exceeds | |
|---|
Performance Goal | | | | | | | | | | | | | |
1. Responsible Care® | | | | | | | | | | | | | |
Recordable Injuries* | | | 5 | % | | 8 | | | 6 | | | 4 | |
Loss of Primary Containment* | | | 5 | % | | 10 | | | 7 | | | 4 | |
Process Safety Incidents* | | | 5 | % | | 2 | | | 1 | | | 0 | |
Sub-total | | | 15 | % | | | | | | | | | |
2. Financial Performance | | | | | | | | | | | | | |
2015 EBITDA Target (Per 2015 Business Plan) | | | 60 | % | $ | 253M | | $ | 283M | | $ | 333 M | |
3. Individual Goals | | | 25 | % | | | | | | | | | |
Total Opportunity at Target | | | 100 | % | | | | | | | | | |
Maximum Opportunity | | | 200 | % | | | | | | | | | |
Metrics represent incident count.
In 2015, our achievement rating for Responsible Care®
The Company’s financial performance qualified each NEO for a 15% annual cash incentive award payout. In addition,metric was based on an Adjusted EBITDA target of $663 million and threshold Adjusted EBITDA target of $530 million. The actual year-end Adjusted EBITDA for purposes of the 2022 ACI Plan was $279 million, which represents the Company’s year-end Adjusted EBITDA of $312 million excluding $102 million in earnings from our 2015joint ventures and $76 million in losses from our Feedstocks segment, and excluding the impact of $7 million of favorable raw material timing, as described above. Based on our 2022 audited financial results, our compensation committee determined that our financial performance component resulted in 200%no payout of the Adjusted EBITDA component of the ACI Plan, as set forth in the table below. All payout values in this table are shown as a percentage of target.
| | | | | | | | | | | | | | | | | | |
| | | | | Performance
Target (100%) | | | | Actual
Result | | | | Payout as % of
Target | | | Payout as % of
Total Target Bonus | |
| | Financial Performance (Adjusted EBITDA) | | | | $ | 663M | | | | | | $ | 279M | | | | | | | 0% | | | | | | 0% | | |
2023 Proxy Statement 36
Compensation Discussion and Analysis
Our achievement rating for the Responsible Care® portion of the bonus becoming payable. Actual resultsqualified each NEO for 166.67% of the Responsible Care® and Adjusted EBITDA financial performance arecomponent of the ACI Plan, as set forth below:below. All payout values in this table are shown as a percentage of target.
| | | | | | | | | | | | | | | | | | |
| | | | | Performance
Target (100%) | | | | Actual
Result | | | | Payout as % of
Target | | | Payout as % of
Total Target Bonus | |
| | Responsible Care® | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Recordable Injuries* | | | | | 8 | | | | | | | 8 | | | | | | | 100% | | | | | | 5% | | |
| | Loss of Primary Containment* | | | | | 8 | | | | | | | 5 | | | | | | | 200% | | | | | | 10% | | |
| | Process Safety Incidents* | | | | | 2 | | | | | | | 0 | | | | | | | 200% | | | | | | 10% | | |
| | Responsible Care® Total | | | | | | | | | | | | | | | | | | | 166.67% | | | | | | 25.0% | | |
| | | | | | | | | | | | | | | | |
| |
| |
| | Level of Performance | |
|---|
| | Actual
Payout | |
| |
|---|
| | Actual | | Threshold | | Target | | Exceeds | |
|---|
Responsible Care® | | | | | | | | | | | | | | | | |
Recordable Injuries* | | | 0 | % | | 9 | | | 8 | | | 6 | | | 4 | |
Loss of Primary Containment* | | | 5 | % | | 7 | | | 10 | | | 7 | | | 4 | |
Process Safety Incidents* | | | 10 | % | | 0 | | | 2 | | | 1 | | | 0 | |
Total | | | 15.0 | % | | | | | | | | | | | | |
Financial Performance (Adjusted EBITDA) | | | 120.0 | % | $ | 410M | | $ | 253M | | $ | 283M | | $ | 333M | |
Metrics represent incident count.
In addition,
The table below shows the contribution of each NEO had personal performance goals that included, depending onmetric under our ACI Plan to the individual: corporate or business EBITDA; asset, product optimization and customer profitability; organizational effectiveness; talent management and cost management. The results achieved against eachactual bonus award earned by our NEOs. All values in this table are shown as a percentage of these goals were assessed by the compensation committee and ratings assigned.target.
| | | | | | | | | | | |
| | NEO | | | EBITDA
(60%) | | | Responsible
Care (15%) | | | Individual
Goals (25%) | | | | Actual Payout
as a % of Target | | |
| | Frank A. Bozich | | | | | 0% | | | | | | 166.67% | | | | | | 90.5% | | | | | | | 47.6% | | | |
| | David Stasse | | | | | 0% | | | | | | 166.67% | | | | | | 100% | | | | | | | 50% | | | |
| | Angelo N. Chaclas | | | | | 0% | | | | | | 166.67% | | | | | | 100% | | | | | | | 50% | | | |
| | Andre Lanning | | | | | 0% | | | | | | 166.67% | | | | | | 85% | | | | | | | 46.25% | | | |
| | Paula Cooney | | | | | 0% | | | | | | 166.67% | | | | | | 100% | | | | | | | 50% | | | |
During 2015,2022, the target bonus under this plan for each NEO under the ACI Plan was based on a percentage of base salary ranging from 150%, in the case of Mr. Pappas, to 75%, in the case of Messrs. Feenan and Pugh, 60% in the case of Ms. Horner and 55% in the case of Mr. Chaclas.salary. The table below shows the 2015
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2022 target annual incentive award for each NEO and the actual award payable, based on ourCompany performance metrics and the individual's performance.
individual performance goals. | | | | | | | | |
| | NEO | | | Target Payout
as % of Base Salary | | | Target Payout
Amount | | | | Actual Payout
as a % of Target | | | | Actual Payout
Amount | | |
| | Frank A. Bozich | | | | | 130% | | | | | $ | 1,365,000 | | | | | | | 47.6% | | | | | | $ | 650,000 | | | |
| | David Stasse | | | | | 75% | | | | | $ | 412,500 | | | | | | | 50% | | | | | | $ | 206,250 | | | |
| | Angelo N. Chaclas | | | | | 75% | | | | | $ | 363,750 | | | | | | | 50% | | | | | | $ | 181,875 | | | |
| | Andre Lanning (1) | | | | | 58.4% (2) | | | | | $ | 293,861 | | | | | | | 46.3% | | | | | | $ | 135,911 | | | |
| | Paula Cooney | | | | | 60% | | | | | $ | 300,000 | | | | | | | 50% | | | | | | $ | 150,000 | | | |
| | | | | | | | | | |
Name | | Target
Percentage | | Target
Amount | | Actual
Amount | |
|---|
Christopher D. Pappas | | | 150% | | $ | 1,575,000 | | $ | 2,693,250 | |
John A. Feenan | | | 75% | | $ | 450,000 | | $ | 720,000 | |
Martin Pugh(1) | | | 65% - 75% | | $ | 386,717 | | $ | 662,249 | |
Marilyn N. Horner | | | 60% | | $ | 252,000 | | $ | 431,550 | |
Angelo N. Chaclas | | | 55% | | $ | 200,750 | | $ | 340,271 | |
Mr. Pugh'sLanning’s compensation is payable in CHF and was converted using the foreign exchange rate of US$1.0371.0486 to CHF1.00. This rate was determined by averaging the monthly exchange rates in effect during 2015. In addition, his 2015 target annual cash incentive award takes2022.
(2)
Mr. Lanning’s ACI Plan Target Payout was increased from 50% of base salary to 60% of base salary, beginning in to consideration the salary increase he received effective as of November 1, 2015 and is a blend of the pro-rated amounts for the time period at each compensation level throughout the year, with a target of 65% utilized for the first ten months of 2015, and a target of 75% utilized for the remainder of 2015.
Based on our achievement rating for Responsible Care® performance, our financial results for 2015 with respect to Adjusted EBITDA, and the compensation committee's determination of achievement of individual performance goals, each as described below, the table below show the 2015 target annual cash incentive award for each NEO and the actual award payable, based on our performance.
The following table shows the contribution of each performance metric under our annual cash incentive plan to the actual bonus award earned by our NEOs.
| | | | | | | | | | | | | |
Name | | Responsible Care®
(15% of Target
opportunity) | | EBITDA
(60% of Target
Opportunity) | | Individual Goals
(25% of Target
Opportunity) | | Actual Award
as % of Target
(100%) | |
|---|
Christopher D. Pappas | | | 100 | % | | 200 | % | | 144 | % | | 171.0 | % |
John A. Feenan | | | 100 | % | | 200 | % | | 100 | % | | 160.0 | % |
Martin Pugh | | | 100 | % | | 200 | % | | 145 | % | | 171.3 | % |
Marilyn N. Horner | | | 100 | % | | 200 | % | | 145 | % | | 171.3 | % |
Angelo N. Chaclas | | | 100 | % | | 200 | % | | 138 | % | | 169.5 | % |
Long-Term Equity Incentive Compensation Our
Board adopted the 2014 Omnibus Incentive Plan and, following our initial public offering (IPO), all equity-based awards were granted under this plan. The 2014 Omnibus Plan provides for awards of stock options, SARs, restricted stock, unrestricted stock, stock units, performance awards, other awards convertible into or otherwise based on our ordinary shares and cash awards. Eligibility for stock options intended to be incentive stock options, or ISOs, is limited to our employees.•Stock options and stock appreciation rights (SARs). The exercise price of a stock option, and the base price against which a SAR is to be measured, may not be less than the fair market value (or, in the case of an ISO granted to a ten percent shareholder, 110% of the fair market value) of our ordinary shares on the date of grant.
•Restricted and unrestricted stock. A restricted stock award is an award of our ordinary shares subject to forfeiture restrictions, while an unrestricted stock award is not subject to such restrictions.
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•Stock units. A stock unit award is an award denominated in our ordinary shares that entitles the participant to receive ordinary shares or cash measured by the value of our ordinary shares in the future. The delivery of our ordinary shares or cash under a stock unit may be subject to the satisfaction of performance conditions or other vesting conditions.
•Performance awards. A performance award is an award the vesting, settlement or exercisability of which is subject to specified performance criteria.
•Cash awards. A cash award is an award denominated in cash.
•Other awards. Other awards are awards that are convertible into or otherwise based on our ordinary shares.
In February 2015, our Boardcompensation committee approved equity award grants to certain key employees, including our NEOs.the NEOs, which were awarded in February 2022 under the Company’s Amended & Restated 2014 Omnibus Incentive Plan (the “Equity Plan”). Each of our NEOs received a grantan equity award comprised of restricted share units andthree types of awards: options to purchase our ordinary shares (30%), RSUs (30%), and PSUs (40%). The total award is based on a target percentage of their base salary, andas shown in the table below. These awards are subject to time-based vesting conditions, with restricted share unit awards vesting in full on the third anniversary of the date of grant and options vesting in three equal annual installments beginning on the first anniversary of the date of grant, RSUs vesting in full on the third anniversary of the date of grant and PSUs partially vesting on each of the first, second and third year anniversary of the date of grant, subject to the Company’s relative total shareholder return (“TSR”) performance. In each case, vesting is generally subject to an NEO'sthe NEO’s continuous employment with us on the applicable vesting date. Our Board approved grants
37 2023 Proxy Statement
Compensation Discussion and Analysis
| | NEO | | | LTI
Target % | | | LTI
Target Amount | |
| | Frank A. Bozich | | | | | 380% | | | | | $ | 3,990,000 | | |
| | David Stasse | | | | | 200% | | | | | $ | 1,100,000 | | |
| | Angelo N. Chaclas | | | | | 150% | | | | | $ | 727,500 | | |
| | Andre Lanning (1) | | | | | 140% | | | | | $ | 689,979 | | |
| | Paula Cooney | | | | | 120% | | | | | $ | 600,000 | | |
(1)
Mr. Lanning’s compensation is payable in CHF and was converted using the foreign exchange rate of long-term incentives in the form of stock options and restricted stock unitsUS$1.0486 to align the interests of our executives with those of our shareholders and to provide a retention tool. | | | | | | | |
Name | | Target
Percentage | | Target
Amount | |
|---|
Christopher D. Pappas | | | 400 | % | $ | 4,200,000 | |
John A. Feenan | | | 125 | % | $ | 750,000 | |
Martin Pugh | | | 150 | % | $ | 935,120 | |
Marilyn N. Horner | | | 130 | % | $ | 546,000 | |
Angelo N. Chaclas | | | 100 | % | $ | 365,000 | |
Additional Incentives to Mr. Chaclas
Mr. Chaclas became our Senior Vice President, Chief Legal Officer, and Corporate Secretary in January 2015. Therefore, prior to becoming part of our executive leadership team, heCHF1.00. This rate was eligible to participate in incentive programs not available to our other NEOs in 2015. Mr. Chaclas participated in the Company's 2012 Long-Term Incentive Plan. The 2012 Long-Term Incentive Plan was designed to provide long-term incentives to our employees who did not receive long-term incentive compensation in the form of equity awards in our Parent. See "Executive Compensation—Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table" for more information regarding our NEOs Executive Subscription Agreements with our Parent. The 2012 Long-Term Incentive Plan sets three-performance year EBITDA targets (excluding inventory revaluation) with each year having equal weighting. The payout factor is determined by averaging the actual payoutmonthly exchange rates in effect during 2022.
Since 2017 the Board has granted PSUs as part of each NEO’s target equity compensation package to increase the percentage approved byof at-risk, long-term incentive-based compensation. We believe the
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PSUs, in a higher concentration of equity compensation committeeas compared to the RSU and stock option components, provides greater alignment between our executive compensation program and the creation of shareholder value through the Company’s long-term strategic initiatives. In addition, our Board considers the stock options to be performance-based because a stock option will only have value to the extent that our stock price increases after the date the stock option is granted.
PSUs granted in 2022 vest during four performance periods, consisting of three one-year performance periods and one three-year performance period, which are each measured independently. Subject to the executive’s continued employment during the full three-year performance period, vesting will be calculated during each performance period based on the Company’s relative TSR performance, assuming the reinvestment of dividends, against the performance of all chemical and basic materials companies in the S&P 600 Small Cap Index (the “Performance Peer Group”) during the fiscal year. PSUs which vest during each performance period will be delivered, in aggregate, following the third anniversary of the grant date (the “final vesting date”).
The number of 2022 PSUs that will vest during each performance period, based on the achievement of relative TSR performance goals, will be as follows:
| | | | | % of Award
Eligible
for Vesting | | | TSE Performance | | | Payout % | |
| | Metric | | | Threshold | | | Target | | | Maximum | | | Threshold | | | Target | | | Maximum | |
| | 2022 – 2023 TSE TSR
(relative to Performance Peer Group) | | | | | 15% | | | | |
| 25th
Percentile | | | | |
| 50th
Percentile | | | | |
| 75th
Percentile | | | | | | 50% | | | | | | 100% | | | | | | 200% | | |
| | 2023 – 2024 TSE TSR
(relative to Performance Peer Group) | | | | | 15% | | | | |
| 25th
Percentile | | | | |
| 50th
Percentile | | | | |
| 75th
Percentile | | | | | | 50% | | | | | | 100% | | | | | | 200% | | |
| | 2024 – 2025 TSE TSR
(relative to Performance Peer Group) | | | | | 15% | | | | |
| 25th
Percentile | | | | |
| 50th
Percentile | | | | |
| 75th
Percentile | | | | | | 50% | | | | | | 100% | | | | | | 200% | | |
| | 2022 – 2025 TSE TSR
(relative to Performance Peer Group) | | | | | 55% | | | | |
| 25th
Percentile | | | | |
| 50th
Percentile | | | | |
| 75th
Percentile | | | | | | 50% | | | | | | 100% | | | | | | 200% | | |
*
Vesting is interpolated between the 25th and 50th and between the 50th and 75th percentiles.
Regardless of the targets above, vesting for each performance year. The cash incentive was paid out in March 2015period is capped at 100% of target if the Company’s TSR is negative for the performance period. Additionally, the total value of the shares delivered at the average payout factorfinal vesting date is capped at three times the target shares multiplied by the grant date share price. Because we assume reinvestment of 69%dividends, dividend equivalents accrue during the performance period. However, dividend equivalents will be paid only if the PSUs vest, and resultedare based on the number of vested PSUs delivered on the final vesting date, since we do not believe the executives should receive the benefit of such dividend earnings if the performance criteria associated with the PSU award is not otherwise met.
The PSU awards granted to NEOs in a cash award to Mr. Chaclas of $66,413. | | | | | | | | | | | | | | | | |
| |
| |
| | Level of Performance | |
|---|
| | Actual
Payout | |
| |
|---|
| | Actual | | Not Met | | Target | | Exceeds | |
|---|
Annual EBITDA Goal | | | | | | | | | | | | | | | | |
2012 | | | 50 | % | $ | 231M | * | $ | 238M | | $ | 318M | | $ | 438M | |
2013 | | | 82 | % | $ | 325M | | $ | 270M | | $ | 356M | | $ | 436M | |
2014 | | | 74 | % | $ | 303M | | $ | 279M | | $ | 329M | | $ | 379M | |
Payout Range | | | 69 | % | | | | | 50 | % | | 100 | % | | 250 | % |
*Because EBIDTDA was just under2020 partially met their TSR performance metrics during the threshold for 2012 the compensation committee approved a threshold payout level in recognitionperformance period and therefore 69.4% of the overall performancetarget awards vested in 2023. Of the Company’s current NEOs, Messrs. Bozich, Stasse and contributions by all employees.
When appropriate, we offer cash retention awards for certain key employees. The purposeChaclas received shares upon vesting of these awards is to maintain the stability of our Company's leadership and other staff by providing an additional incentive for these individuals to remain with the Company during the period over which the award vested. In July 2013, the Company agreed to pay Mr. Chaclas a special cash retention award payable in three installments. The right to receive any amount was contingent on strong sustained leadership, overall performance and continuous full-time employment with the Company through December 31, 2015. The final payment in the amount of $65,000 was made in December 2015.
PSU awards.
Other Compensation and Tax Matters
Our qualified U.S. savings plan (the "401(k) plan"“401(k) plan”) provides for (1) annual discretionary Company contributions and (2) employer matching contributions to be credited to participants'participants’ accounts. The U.S.-based NEOs participate in this plan on the same basis as our other employees. We also maintain a non-qualified U.S. savings and deferral plan in which each of our U.S.-based NEOs (other than Mr. Pugh) participates.may participate. This plan allows participants to defer a portion of their compensation on a pre-tax basis, with matching contributions from the Company
2023 Proxy Statement 38
Compensation Discussion and Analysis
that are payable at a future date based on the terms of the plan. Additionally, the plan provides for discretionary Company contributions in connection with earnings that are in excess of the limitations set forth in the 401(k) Plan.plan.
Our NEOs do not participate or have account balances in any qualified or nonqualifiednon-qualified defined benefit pension plans sponsored by the Company, with the exception of Mr. Pugh,Lanning, who participatesparticipated in our Switzerland-based defined contribution retirement plan. Mr. Pugh is also entitled toOur NEOs do not participate in any supplemental employee retirement plan or have such a retirement benefit payable at age 65 in the amount of CHF 250,000, which will be prorated if his retirement from the Company occurs prior to age 65. Pursuant to the terms of Mr. Pappas's employment agreement, he is entitled to a retirement benefit payable in the form of a cash lump sum upon his retirement or other termination of employment in an amount determined in accordance with a formula contained in his employment agreement as described in more detail under "Executive Compensation—Pension and Other Postretirement Benefits—Supplemental Employee Retirement Benefit" below.
plan provided by their agreement.
We provide change-in-control severance benefits to certain executives, including our current NEOs. These change-in-control severance benefits are intendeddesigned to minimize the distraction and uncertainty that could affect key management in the event we become involved in a transaction that could result in a change in control of the Company and to enable the executives to impartially evaluate such a transaction. These change-in-control benefits are structured with “double trigger” terms. Under the terms of these agreements, each NEO is entitled to a lump sum payment equal to 2.0 times the severance benefits set forth above (rather than paymentsum of severance benefitsthe executive’s annual base salary and target bonus, and in installments)the case of Mr. Bozich, 3.0 times the sum of his annual base salary and target bonus, if the NEO experiences a termination ofNEO’s employment is terminated other than for cause“Cause” or in the eventif the NEO resigns for good“good reason,” as defined in the agreements, within two years following a change-in-controlchange in control of the Company. Mr. Pappas is also entitled to a so-calledThe compensation committee does not permit 280G gross-up with respect to certain payments that may be made to himprovisions in connection with a change in control, a benefit that was negotiated at the time Mr. Pappas was hired by us.its executive employment agreements or amendments.
Each NEO is eligible to participate in our generally-applicablegenerally-available benefit plans, such as savings, medical, dental, group life, disability and accidental death and dismemberment insurance, in accordance with country practices.Tax Additionally, the Company may offer certain perquisites to certain executives when appropriate or necessary to recruit or retain talented and Accounting Considerations
Section 162(m)qualified individuals. As a Company that operates worldwide, we often offer certain types of perquisites to our executives, such as payment of group life insurance premiums, or tuition payments for children or moving expenses to compensate executives who relocate. See the Code imposes a limitfootnotes to the “Summary Compensation Table” and the “
Narrative Disclosure to Summary Compensation Table and Grants of $1,000,000 onPlan Based Awards Table; Other Narrative Disclosure” below for more details regarding the amount that a publicly-traded company may deduct for federal income tax purposes in any taxable year forother compensation paid to our CEONEOs. Anti-Hedging and the threePledging Policy
The Board has adopted a policy prohibiting hedging transactions and disallowing pledging transactions subject to certain narrow exceptions. Pursuant to this policy, no officer, director or employee may engage in short sales, hedging or monetization transactions, such as zero-cost collars and forward sale contracts, puts, calls, or other highest-paid NEOs, other than our CFO, whoderivative securities including options, warrants, convertible securities, stock appreciation rights or similar securities. This prohibition does not apply to exercise of Company stock options. Officers, directors and employees are employed asalso prohibited from maintaining Company securities in a margin account. No officer, director or employee of the end ofCompany may pledge Company securities as collateral for a loan without first showing financial capacity to repay the year. Toloan and obtaining preapproval from the extent that compensation is "performance-based" within the meaning of Section 162(m) or to the extent that compensation meeting certain requirements is paid during a limited period of time following our IPO, the Section's limitations will not apply. To qualify as performance based, compensation must, among other things, be paid pursuant to a shareholder approved plan upon the attainment of objective performance criteria. Our compensation committee believes that the tax deductibility of compensation is an important factor, but not the sole factor, in setting executive compensation policies and in rewarding superior executive performance. However, the compensation committee reserves the right to approve the payment of compensation to our executive officers that does not qualify as "performance-based" within the meaning of Section 162(m) and therefore, may not be deductible for federal income tax purposes.
In determining variable compensation program designs, our compensation committee also considers other tax and accounting implications of particular forms of compensation, such as the implications of Section 409A of the Code governing deferred compensation arrangements and favorable accounting treatment afforded certain equity based plans that are settled in shares.
Company’s Chief Compliance Officer.
We intend to regularly award annual equity grants to our executive officers in February and June of each year. year, so as to provide a pre-set schedule for our equity grants that won’t be impacted by events external or internal to the Company. New hires may, depending on the timing of their hire, be eligible for a grant at the next board meeting following his or her hire.
39 2023 Proxy Statement
Compensation Discussion and Analysis
Compensation Committee Report
The equity grant date is not selected or changedcompensation committee has reviewed and discussed the Compensation Discussion and Analysis section (the “CD&A”) required by Item 402(b) of Regulation S-K with management. Based on such review and discussions, the compensation committee recommended to increase the value of equity awards for executives, but isBoard that the date when the Board's resolution is effective.CD&A be included in this proxy statement on Schedule 14A.
THE COMPENSATION COMMITTEE
Joseph Alvarado, Chair
Victoria Brifo
Pierre-Marie De Leener
Matthew Farrell
K’Lynne Johnson
Philip R. Martens
2023 Proxy Statement 40
Executive Compensation
Summary Compensation Table The following table sets forth information regarding the compensation paid to or earned by our NEOs for the years ended December 31, 2015, 2014,2022, 2021 and 2013.2020, as applicable. For additional information, please read the footnotes and narrative disclosures that follow the table.
| | Name and Principal Position | | | Year | | | Salary
($) (2) | | | Bonus
($) (3) | | | Stock
Awards
($) (4) | | | Option
Awards
($)(5) | | | Non-Equity
Incentive Plan
Compensation
($)(6) | | | Changes
in Pension
Value and
Non-qualified
Deferred
Compensation
Earnings
($) (7) (8) | | | All Other
Compensation
($) (9) | | | Total
($) | |
| | Frank Bozich
President and Chief Executive
Officer | | | | | 2022 | | | | | | 1,050,000 | | | | | | — | | | | | | 2,761,179 | | | | | | 1,197,862 | | | | | | 650,000 | | | | | | 2,041 | | | | | | 132,501 | | | | | | 5,793,583 | | |
| | | | 2021 | | | | | | 1,025,000 | | | | | | — | | | | | | 2,511,215 | | | | | | 1,076,254 | | | | | | 2,265,251 | | | | | | 8 | | | | | | 124,165 | | | | | | 7,001,892 | | |
| | | | 2020 | | | | | | 882,692 | | | | | | — | | | | | | 1,935,997 | | | | | | 826,322 | | | | | | 1,364,354 | | | | | | — | | | | | | 26,554 | | | | | | 5,035,919 | | |
| | David Stasse
Executive Vice President & Chief Financial Officer | | | | | 2022 | | | | | | 550,000 | | | | | | — | | | | | | 761,223 | | | | | | 330,226 | | | | | | 206,250 | | | | | | 1,700 | | | | | | 61,342 | | | | | | 1,910,742 | | |
| | | | 2021 | | | | | | 520,000 | | | | | | — | | | | | | 636,978 | | | | | | 272,994 | | | | | | 663,000 | | | | | | 13 | | | | | | 54,502 | | | | | | 2,147,487 | | |
| | | | 2020 | | | | | | 472,596 | | | | | | — | | | | | | 528,002 | | | | | | 225,363 | | | | | | 355,110 | | | | | | 326 | | | | | | 51,784 | | | | | | 1,330,174 | | |
| | Angelo N. Chaclas
Senior Vice President and Chief Legal Officer | | | | | 2022 | | | | | | 485,000 | | | | | | — | | | | | | 503,424 | | | | | | 218,402 | | | | | | 181,875 | | | | | | 9,376 | | | | | | 55,671 | | | | | | 1,453,748 | | |
| | | | 2021 | | | | | | 460,000 | | | | | | — | | | | | | 482,985 | | | | | | 206,996 | | | | | | 586,500 | | | | | | 21,789 | | | | | | 50,171 | | | | | | 1,808,441 | | |
| | | | 2020 | | | | | | 420,611 | | | | | | — | | | | | | 469,935 | | | | | | 200,569 | | | | | | 313,712 | | | | | | 6,599 | | | | | | 51,407 | | | | | | 1,462,833 | | |
| | Andre Lanning (1)
Senior Vice President and
Chief Commercial Officer | | | | | 2022 | | | | | | 478,384 | | | | | | 157,290 | | | | | | 488,873 | | | | | | 212,089 | | | | | | 135,911 | | | | | | 124,783 | | | | | | 8,651 | | | | | | 1,605,980 | | |
| | | | 2021 | | | | | | 458,192 | | | | | | 273,650 | | | | | | 252,605 | | | | | | 108,240 | | | | | | 426,307 | | | | | | 108,365 | | | | | | 14,230 | | | | | | 1,641,589 | | |
| | | | 2020 | | | | | | 441,788 | | | | | | 267,750 | | | | | | 92,510 | | | | | | 39,705 | | | | | | 130,822 | | | | | | 420,903 | | | | | | 5,355 | | | | | | 1,398,832 | | |
| | Paula Cooney
Senior Vice President and Chief Human Resources Officer | | | | | 2022 | | | | | | 500,000 | | | | | | — | | | | | | 415,250 | | | | | | 180,136 | | | | | | 150,000 | | | | | | — | | | | | | 26,715 | | | | | | 1,272,100 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Name and Principal Position | | Year | | Salary
($) | | Bonus
($)(1)(2) | | Stock
Awards
($)(3) | | Option
Awards
($)(4) | | Non-Equity
Incentive
Plan
Compensation
($)(5) | | Changes
in Pension
and Other
Postretirement
Benefits
Value and
Non-qualified
Deferred
Compensation
Earnings
($)(6)(7) | | All Other
Compensation
($)(8) | | Total
($) | |
|---|
Christopher D. Pappas | | | 2015 | | $ | 1,050,000 | | $ | — | | $ | 2,100,000 | | $ | 2,100,000 | | $ | 2,693,250 | | $ | 2,048,653 | | $ | 164,000 | | $ | 10,155,903 | |
President and Chief | | | 2014 | | $ | 1,000,001 | | $ | 500,000 | | $ | — | | $ | — | | $ | 1,218,725 | | $ | 2,865,711 | | $ | 165,104 | | $ | 5,749,541 | |
Executive Officer | | | 2013 | | $ | 1,000,000 | | $ | — | | $ | 11,284,837 | | $ | — | | $ | 1,600,000 | | $ | 2,007,918 | | $ | 165,302 | | $ | 16,058,057 | |
John A. Feenan(9) | | |
2015 | |
$ |
600,000 | |
$ |
— | |
$ |
375,000 | |
$ |
375,000 | |
$ |
720,000 | |
$ |
— | |
$ |
62,502 | |
$ |
2,132,502 | |
EVP & Chief | | | 2014 | | $ | 600,000 | | $ | 1,000,000 | | $ | — | | $ | — | | $ | 375,180 | | $ | — | | $ | 61,948 | | $ | 2,037,128 | |
Financial Officer | | | 2013 | | $ | 600,000 | | $ | — | | $ | — | | $ | — | | $ | 465,000 | | $ | — | | $ | 176,493 | | $ | 1,241,493 | |
Martin Pugh(10) | | |
2015 | |
$ |
622,200 | |
$ |
— | |
$ |
467,560 | |
$ |
467,560 | |
$ |
662,249 | |
$ |
184,440 | |
$ |
— | |
$ |
2,404,009 | |
EVP & Chief | | | 2014 | | $ | 603,900 | | $ | 549,000 | | $ | — | | $ | — | | $ | 271,030 | | $ | 424,591 | | $ | — | | $ | 1,848,521 | |
Operating Officer | | | 2013 | | $ | 495,017 | | $ | 918,026 | | $ | 2,090,261 | | $ | — | | $ | 283,510 | | $ | 1,311,635 | | $ | 2,569 | | $ | 5,101,018 | |
Marilyn N. Horner | | |
2015 | |
$ |
420,000 | |
$ |
— | |
$ |
273,000 | |
$ |
273,000 | |
$ |
431,550 | |
$ |
— | |
$ |
49,879 | |
$ |
1,447,429 | |
SVP, Human Resources | | | 2014 | | $ | 420,000 | | $ | 210,000 | | $ | — | | $ | — | | $ | 198,367 | | $ | — | | $ | 49,591 | | $ | 877,958 | |
Angelo N. Chaclas | | |
2015 | |
$ |
365,000 | |
$ |
65,000 | |
$ |
182,500 | |
$ |
182,500 | |
$ |
406,684 | |
$ |
— | |
$ |
40,189 | |
$ |
1,241,873 | |
SVP, Chief Legal Officer, & Corporate Secretary | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Compensation for Mr. Lanning was paid or is payable in CHF. The amount of compensation earned or received during 2022, 2021 and 2020 was converted using the foreign exchange rate of US$1.0486 to CHF 1.000, US$1.0946 to CHF 1.00 and US$1.071 to CHF1.00, respectively. These rates have been determined by averaging the exchange rates in effect for each calendar year.
(2)
In March 2022, Mr. Lanning’s base salary was increased from CHF 470,000 to CHF 480,000. In 2020, base salaries for Messrs. Bozich, Stasse and Chaclas were slightly higher than their annualized base salary, due to an extra pay period for U.S. salaried employees who are paid on a bi-weekly schedule. Additionally, in the second quarter of 2020 Messrs. Bozich, Stasse and Chaclas each took voluntary pay reductions, with Mr. Bozich reducing his pay during the quarter by 50%, and Messrs. Stasse and Chaclas reducing their pay during the quarter by 25%.
(3)
The amounts in this column for 2014 for Mr. Pappas and Ms. Horner reflect their special retention awards paid in 2014. Amounts in this column for Mr. Chaclas reflect a special retention award paid in 2015, which is described above under "Compensation Discussion and Analysis—Compensation Elements—Additional Incentives to Mr. Chaclas".
(2)Mr. Feenan was entitled to a $5.0 million retention award pursuant to his employment agreement dated December 22, 2011. These amounts vested and were paid over a four-year period. Mr. Feenan received $1.0 million in 2014 pursuant to his employment agreement. In 2013 no retention awards were paid to Mr. Feenan and pursuantLanning are related to his November 16, 2015 separation letter agreement remaining retention award amounts were forfeited. Mr. Pugh received a retentionsign-on bonus of CHF 750,000granted as part of his offer of employment agreement,made in 2019, and a retention award granted in 2020, which wasare paid in two installments of CHF 250,000 and CHF 500,000 in 2013 and 2014, respectively. In addition, Mr. Pugh received a signing bonus of CHF 600,000 in connection with his employment in March 2013.
(3)over multiple years.
(4)
The amount in this column reflects the fair value of restricted sharestock unit and restricted stock unitsperformance unit awards granted in the periods presented, (there were no share awards granted in 2014), calculated in accordance with ASC 718, excluding the effects of estimated forfeitures.718. The assumptions used for determining fair value are described in Note 17 to our consolidated financial statements filed with our Annual Report on Form 10-K. In 2013, the amount attributable to the performance-based portionThe grant date fair value of the PSU awards assumes that all performance-based vesting criteria were satisfiedgranted in full. The performance-based awards were modified in connection with our IPO2022, assuming achievement of the highest level of performance (200% of the target award) is as described below in "—Narrative Disclosure to Summaryfollows:
| | NEO | | | Maximum Grant Date
Fair Value | |
| | Frank Bozich | | | | $ | 3,128,321 | | |
| | David Stasse | | | | $ | 862,394 | | |
| | Angelo N. Chaclas | | | | $ | 570,332 | | |
| | Andre Lanning | | | | $ | 553,895 | | |
| | Paula Cooney | | | | $ | 470,449 | | |
41 2023 Proxy Statement
Executive Compensation Table and Grants of Plan-Based Awards Table."
(4)
(5)
The amount in this column reflects the fair value of option awards granted in 2015,the periods presented, computed using the Black-Scholes pricing model, whose inputs and assumptions are as of the grant datedates and described in Note 17 to our consolidated financial statements filed with our Annual Report on Form 10-K. There were no grants of option awards under the 2014 Omnibus Incentive Plan prior to 2015.
(5)
(6)
This amount includes each NEO'sNEO’s earned annual cash incentive payout as discussed in "Compensation“Compensation Discussion and Analysis—2022 Compensation Elements—Structure & Performance—Annual Cash Incentive Plan"Plan” above. Additionally, for Mr. Chaclas
(7)
The amount in 2015 this amount includes incentive payoutscolumn reflects the aggregate change in the actuarial present value of the applicable NEO’s accumulated benefit under our defined benefit pension plan and arrangements in respect of each year in the Company's 2012 Long-Term Incentive Plan described under "Compensation Discussiontable. Messrs. Bozich, Stasse and Analysis—Compensation Elements—Additional Incentives to Mr. Chaclas".
(6)Changes in Pension and Other Postretirement Benefits for Messrs. Pappas and Pugh for the year December 31, 2015 amounted to $2,048,653 and $184,440, respectively. Changes in Pension and Other Postretirement Benefits for Messrs. Pappas and Pugh for the year ended December 31, 2014 amounted to $2,865,711 and $424,591, respectively. Changes in Pension and Other Postretirement Benefits for Messrs. Pappas and Pugh for the year ended December 31, 2013 amounted to $2,007,918 and $1,311,635, respectively. Mr. Chaclas and Ms. Horner do not participate in pension and other postretirement benefit arrangements and Mr. FeenanCooney did not participate in pension and other postretirement benefit arrangements prior to his termination from the Company. Please see "—Pensionarrangements.
(8)
Amounts reported for Messrs. Bozich, Stasse and Other Postretirement Benefits" for a description of these arrangements.
(7)No amount is reported with respect toChaclas reflect earnings on non-qualified deferred compensation plans because above market rates are not provided under such plans. See "—U.S.“—U.S. Non-Qualified Deferred Compensation Table"Table” below for information with respect to the NEOs'NEOs’ deferred compensation amounts for 2015.2022.
Table of Contents
Included in "All“All Other Compensation"Compensation” for fiscal year 20152022 were the following items:
| | NEO | | | 401k Plan
($) (i) | | | Non-qualified
deferred
comp plan
($) (ii) | | | Allowances
($) (iii) | | | Other
($) (iv) | | | Total ($) | |
| | Frank Bozich | | | | | 26,101 | | | | | | 106,250 | | | | | | — | | | | | | 150 | | | | | | 132,501 | | |
| | David Stasse | | | | | 27,567 | | | | | | 33,625 | | | | | | — | | | | | | 150 | | | | | | 61,342 | | |
| | Angelo N. Chaclas | | | | | 27,584 | | | | | | 27,938 | | | | | | — | | | | | | 150 | | | | | | 55,671 | | |
| | Andre Lanning | | | | | — | | | | | | — | | | | | | 8,651 | | | | | | — | | | | | | 8,651 | | |
| | Paula Cooney | | | | | 26,715 | | | | | | — | | | | | | — | | | | | | 150 | | | | | | 26,715 | | |
| | | | | | | | | | | | | |
Name | | 401(k) plan(i) | | Non-qualified
deferred
compensation
plan(ii) | | Other(iii) | | Total | |
|---|
Christopher D. Pappas | | $ | 21,266 | | $ | 141,150 | | $ | 1,584 | | $ | 164,000 | |
John A. Feenan | | $ | 22,700 | | $ | 39,250 | | $ | 552 | | $ | 62,502 | |
Marilyn N. Horner | | $ | 22,297 | | $ | 26,550 | | $ | 1,032 | | $ | 49,879 | |
Angelo N. Chaclas | | $ | 24,599 | | $ | 15,038 | | $ | 552 | | $ | 40,189 | |
Represents Company matching and discretionary contributions to the 401(k) Plan for all NEOs except Mr. Pugh.
Plan.
(ii)
Represents Company matching and discretionary contributions to our non-qualified deferred compensation plan (such amounts are also included in the "—U.S.“U.S. Non-Qualified Deferred Compensation Table"Table” below).
(iii)
These amounts represent a family allowance (for children until age 16; and for all NEOs except Mr. Pugh.
(iii)education until age 25) offered by the Swiss government.
(iv)
Represents the amountaggregate of all other compensation items paid to the NEOs for personal benefits, which individually do not exceed $10,000. For Messrs. Bozich, Stasse, and Chaclas and Ms. Cooney, these amounts represent payment of group term life insurance premiums paid for all NEOs except Mr. Pugh.premiums.
(9)Mr. Feenan resigned from his officer position on November 18, 2015 and was employed in an advisory capacity with the Company through the end of 2015. Amounts in the table include amounts paid to him in respect of his employment as
2023 Proxy Statement 42
Executive Vice President and Chief Financial Officer, as well as in respect to his other service to the Company.
(10)Mr. Pugh's compensation was paid or payable in CHF. The amount of compensation earned or received during 2015. 2014, and 2013 was converted using the foreign exchange rate of US$1.037 to CHF1.00, US$1.098 to CHF1.00, and US$1.08 to CHF1.00, respectively. These rates have been determined by averaging the exchange rates in effect for each calendar year. The amounts included in the 2013 "Salary" and "Non-Equity Incentive Plan" columns for Mr. Pugh represent amounts received for the period between March 1 and December 31, 2013.Compensation
Grant of Plan-Based Awards Table The following table shows all plan-based awards granted to the NEOs during 2015.2022. All equity awards were granted under ourthe Equity Plan as a target percentage of each NEOs base salary with the target value of the equity award comprised of stock options (30%), RSUs (30%), and PSUs (40%) granted under the Company’s Amended & Restated 2014 Omnibus Incentive Plan (OIP).Plan. See “Compensation Discussion and Analysis—2022 Compensation Structure & Performance—Long-Term Equity Incentive Compensation” for more information regarding the 2022 equity awards. All NEOs earned cash incentive awards for 20152022 performance under the Company's annual cash incentive plan (ACIP).Company’s ACI Plan. See “Compensation Discussion and Analysis—2022 Compensation Structure & Performance—Annual Cash Incentive Plan” above.
| | | | | | | | | | | Estimated Future Payouts
Under Non-Equity Plan
Awards (1) | | | Estimated Future Payouts
Under Equity Plan
Awards (2) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Name | | | Grant
Date | | | Threshold
($) | | | Target
($) | | | Maximum
($) | | | Threshold
(#) | | | Target
(#) | | | Maximum
(#) | | | All other
stock
awards:
Number of
shares
of stock
or units
(#) (3) | | | All other
option
awards:
Number of
securities
underlying
options
(#) (4) | | | Exercise or
Base Price
of Option
Awards
($/sh) | | | Closing
Stock
Price on
Grant Date
($/sh) | | | Grant Date
Fair Value
of Stock
and
Option
Awards
($) | |
| | Frank Bozich | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Options | | | | | 2/16/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 52,746 | | | | | | 58.64 | | | | | | — | | | | 1,197,862 | |
| | RSUs | | | | | 2/16/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 20,413 | | | | | | — | | | | | | — | | | | | | 58.64 | | | | 1,197,018 | |
| | PSUs | | | | | 2/16/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | 13,609 | | | | | | 27,217 | | | | | | 54,434 | | | | | | — | | | | | | — | | | | | | — | | | | | | 58.64 | | | | 1,564,161 | |
| | ACI | | | | | 1/1/2022 | | | | | | — | | | | | | 1,365,000 | | | | | | 2,730,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | — | |
| | David Stasse | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Options | | | | | 2/16/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 14,541 | | | | | | 58.64 | | | | | | — | | | | 330,226 | |
| | RSUs | | | | | 2/16/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 5,628 | | | | | | — | | | | | | — | | | | | | 58.64 | | | | 330,026 | |
| | PSUs | | | | | 2/16/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | 3,752 | | | | | | 7,503 | | | | | | 15,006 | | | | | | — | | | | | | — | | | | | | — | | | | | | 58.64 | | | | 431,197 | |
| | ACI | | | | | 1/1/2022 | | | | | | — | | | | | | 412,500 | | | | | | 825,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | — | |
| | Angelo N. Chaclas | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Options | | | | | 2/16/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 9,617 | | | | | | 58.64 | | | | | | — | | | | 218,402 | |
| | RSUs | | | | | 2/16/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 3,722 | | | | | | — | | | | | | — | | | | | | 58.64 | | | | 218,258 | |
| | PSUs | | | | | 2/16/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | 2,481 | | | | | | 4,962 | | | | | | 9,924 | | | | | | — | | | | | | — | | | | | | — | | | | | | 58.64 | | | | 285,166 | |
| | ACI | | | | | 1/1/2022 | | | | | | — | | | | | | 363,750 | | | | | | 727,500 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | — | |
| | Andre Lanning | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Options | | | | | 2/16/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 9,339 | | | | | | 58.64 | | | | | | — | | | | 212,089 | |
| | RSUs | | | | | 2/16/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 3,614 | | | | | | — | | | | | | — | | | | | | 58.64 | | | | 211,925 | |
| | PSUs | | | | | 2/16/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | 2,410 | | | | | | 4,819 | | | | | | 9,638 | | | | | | — | | | | | | — | | | | | | — | | | | | | 58.64 | | | | 276,948 | |
| | ACI | | | | | 1/1/2022 | | | | | | — | | | | | | 293,861 | | | | | | 587,722 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | — | |
| | Paula Cooney | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Options | | | | | 2/16/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 7,932 | | | | | | 58.64 | | | | | | — | | | | 180,136 | |
| | RSUs | | | | | 2/16/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 3,070 | | | | | | — | | | | | | — | | | | | | 58.64 | | | | 180,025 | |
| | PSUs | | | | | 2/16/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | 2,047 | | | | | | 4,093 | | | | | | 8,186 | | | | | | — | | | | | | — | | | | | | — | | | | | | 58.64 | | | | 235,225 | |
| | ACI | | | | | 1/1/2022 | | | | | | — | | | | | | 300,000 | | | | | | 600,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| |
| |
| |
| |
| |
| |
| |
| |
| | Grant
Date
Fair Value
of Stock
and
Option
Awards
($)(2) | |
|---|
| |
| | Estimated Future Payouts
Under Non-Equity
Plan Awards(1) | | All other
stock
awards:
Number of
shares of
stock or
units(#) | | All other
option
awards:
Number of
securities
underlying
options(#) | | Exercise
or Base
Price of
Option
Awards
($/Sh) | | Closing
Stock
Price on
Grant
Date
($/Sh) | |
|---|
Name | | Grant
Date | | Threshold
($) | | Target
($) | | Maximum
($) | |
|---|
Christopher D. Pappas | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
OIP—Options | | | 2/27/2015 | | | — | | | — | | | — | | | — | | | 272,391 | | | 18.14 | | | — | | $ | 2,100,000 | |
OIP—RSUs | | | 2/27/2015 | | | — | | | — | | | — | | | 115,776 | | | — | | | — | | | 18.14 | | $ | 2,100,000 | |
ACIP | | | 2/19/2015 | | | — | | | 1,575,000 | | | 3,150,000 | | | — | | | — | | | — | | | — | | | — | |
John A. Feenan | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
OIP—Options | | | 2/27/2015 | | | — | | | — | | | — | | | — | | | 48,641 | | | 18.14 | | | — | | $ | 375,000 | |
OIP—RSUs | | | 2/27/2015 | | | — | | | — | | | — | | | 20,673 | | | — | | | — | | | 18.14 | | $ | 375,000 | |
ACIP | | | 2/19/2015 | | | — | | | 450,000 | | | 900,000 | | | — | | | — | | | — | | | — | | | — | |
Martin Pugh | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
OIP—Options | | | 2/27/2015 | | | — | | | — | | | — | | | — | | | 57,944 | | | 18.14 | | | — | | $ | 467,560 | |
OIP—RSUs | | | 2/27/2015 | | | — | | | — | | | — | | | 24,626 | | | — | | | — | | | 18.14 | | $ | 467,560 | |
ACIP | | | 2/19/2015 | | | — | | | 386,717 | | | 773,434 | | | — | | | — | | | — | | | — | | | — | |
Marilyn N. Horner | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
OIP—Options | | | 2/27/2015 | | | — | | | — | | | — | | | — | | | 35,411 | | | 18.14 | | | — | | $ | 273,000 | |
OIP—RSUs | | | 2/27/2015 | | | — | | | — | | | — | | | 15,050 | | | — | | | — | | | 18.14 | | $ | 273,000 | |
ACIP | | | 2/19/2015 | | | — | | | 252,000 | | | 504,000 | | | — | | | — | | | — | | | — | | | — | |
Angelo N. Chaclas | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
OIP—Options | | | 2/27/2015 | | | — | | | — | | | — | | | — | | | 23,672 | | | 18.14 | | | — | | $ | 182,500 | |
OIP—RSUs | | | 2/27/2015 | | | — | | | — | | | — | | | 10,061 | | | — | | | — | | | 18.14 | | $ | 182,500 | |
ACIP | | | 2/19/2015 | | | — | | | 200,750 | | | 401,500 | | | — | | | — | | | — | | | — | | | — | |
Represents awards provided under our annual cash incentive planACI Plan discussed above under "See "“Compensation Discussion and Analysis—2022 Compensation Elements—Structure & Performance—Annual Cash Incentive Plan"”. The maximum amount represents two times the target amount. The actual amounts earned by the NEOs with respect to 20152022 are included in the "Non-Equity“Non-Equity Incentive Plan Compensation"Compensation” column of the Summary Compensation Table above.
(2)Equity awards under
This column represents unvested PSUs granted in 2022. PSUs partially vest in four performance periods ending on each of the 2014 Omnibus Incentive Plan were paid as a target percentagefirst, second and third year anniversary of the date of grant, subject to achieving certain TSR performance metrics during each vesting period. The number of PSUs that vest upon completion of each NEOs base salary with the target valueperformance period can range from 0 to 200% of the equity award being split evenly between optionoriginal grant.
(3)
This column represents unvested RSUs granted in 2022. All RSUs vest in full on the third anniversary of the grant date.
(4)
Option awards and RSUs. See "Compensation Discussion and Analysis—Compensation Elements—Long-Term Equity Incentive Compensation" for more information regardingvest in three equal installments beginning on the 2015 equity awards.first anniversary of the grant date.
43 2023 Proxy Statement
Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table; Other Narrative Disclosure Employment Agreements with Current Executives
Each NEO is employed by us pursuant to a written agreement of employment. We have entered into executive employment agreements with each of Messrs. Pappas, Feenan, andMr. Bozich in December 2018, Mr. Stasse in April 2019, Mr. Chaclas in January 2020, Mr. Lanning in October 2021 and Ms. Horner,Cooney in October 2021. Mr. Bozich’s employment agreement provides for an initial three-year term, which may be terminated with employment dates commencing on June 17, 2010, January 16, 2012, November 17, 2014,at least one year prior written notice. Mr. Stasse’s, Mr. Chaclas’ and January 5, 2011, respectively. TheMs. Cooney’s agreements provide for an initial term of three yearsone year and are subject to automatic one-year extensions beginning on the expiration of the initial term. The automatic extension of the agreementsterm, which may be terminated with at least 90 days'days’ prior written notice from the executive or the Company stating the intent not to extend the employment term. On April 11, 2013, the agreement with Mr. Pappas was amended and restated with retroactive effect as of January 2, 2013, and was extended until June 30, 2017. Mr. Pugh also entered into anLanning’s employment agreement with us on March 1, 2013. In October 2014, the term of Mr. Pugh's employment agreement was amended to extend its term to March 1, 2017. The term does not automatically extend, although it may be extended by mutual agreement betweenterminated with 6 months’ advance written notice.
Under the Company and Mr. Pugh. Under theseterms of their agreements, Messrs. Pappas, Feenan andBozich, Stasse, Chaclas, Lanning and Ms. Horner are (or were)Cooney were entitled to receive minimum annual base salaries in 20152022 of $1,050,000, $600,000, $365,000$550,000, $485,000, CHF 480,000 and $420,000,$500,000, respectively. Mr. Lanning’s base salary was increased from CHF 470,000 to CHF 480,000 in March 2022. These salaries are subject to annual review and increase by the compensation committee and/or Board in its sole discretion. Mr. Pugh's agreement was amended effective November 1, 2015 in connection with his appointment to Chief Operating Officer of the Company. His annual base salary of CHF 550,000 was increased to CHF 600,000. His salary is subject to annual review by the Board (or a committee thereof) during the first 90 days of each calendar year, and the base salary in respect of such calendar year may be increased above, but not decreased below, its level for the preceding calendar year.
Each NEO is also entitled to participate in our employee and fringe benefit plans as may be in effect from time to time on the same general basis as our other employees.
Under thesetheir employment agreements, including increases approved by the compensation committee, Messrs. Pappas, Feenan, Pugh, andBozich, Stasse, Chaclas and Lanning and Ms. HornerCooney had target bonus opportunities under our annual cash incentive planACI Plan equal to 150%130%, 75%, 75%, 55%60% and 60%, respectively, of their base salaries. Mr. Lanning’s target was increased from 50% to 60% in March 2022. For 2015, these2022, payouts to NEOs were paid abovebelow target, but belowbased on the plan maximum of 200%.Company’s underperformance compared to financial performance metrics in 2022. See "“Compensation Discussion and Analysis—2022 Compensation Elements—Structure and Performance—Annual Cash Incentive Plan"Plan” for additional details on how the cash incentive awards were determined. In addition, following her start date in 2021, Ms. Cooney also received a special one-time lump-sum cash incentive award of $300,000, which vests ratably over three years based on her continued employment.
Equity Awards under Amended & Restated 2014 Omnibus Incentive Plan
Each of our NEOs participated in our 2014 Omnibus Incentive Plan. For 2015,Equity Plan in 2022. Messrs. Pappas, Feenan, Pugh, andBozich, Stasse, Chaclas and Lanning and Ms. HornerCooney received an annual target equity incentive award under the planEquity Plan of 400%380%, 125%200%, 150%, 100%,140% and 130%120% respectively, of their base salaries. The value of the equity award wasis split evenly betweenamong stock options (30%), RSUs (30%), and options. Mr. Feenan's 2015 awardsPSUs (40%). Following her start date, Ms. Cooney also received a special one-time equity incentive award of RSUs, with a grant value of $300,000, which RSUs vest ratably over three years based on her continued employment.
Restricted Stock Units. RSUs granted under the 2014 Omnibus IncentiveEquity Plan were forfeitedwill vest in connectionfull on the third anniversary of the grant date, generally subject to the executive’s continued employment with his termination. See "—Payments upon Terminationthe Company on the vesting date. Upon a termination of employment due to the employee’s death or Changedisability prior to the vesting date, or termination without cause within 2 years of a change in Control" below.control, the RSUs will vest in full. Upon the employee’s retirement prior to the vesting date, or without cause due to a restructuring or redundancy, the RSUs will vest in part, prorated based on the employee’s termination date. In the event the employee voluntarily resigns or is terminated for cause, all unvested RSUs will be forfeited. Upon vesting, for each RSU held by an award holder, such award holder will be entitled to an amount equal to any cash dividend or repayment of equity paid by the Company for one ordinary share during the vesting period (“dividend equivalents”). Award holders have no right to receive the dividend equivalents unless and until the associated RSUs vest. The dividend equivalents will be payable in cash and will not accrue interest.
Performance Stock Units. PSUs granted under the Equity Plan in 2022 will vest during four performance periods, consisting of three one-year performance periods and one three-year performance period, which are each measured independently. Vesting will be calculated during each performance period, subject generally to the executive’s continued employment and based on the Company’s relative TSR performance, assuming the reinvestment of dividends, against the performance of all chemical and basic materials companies in the S&P 600 Small Cap Index. The percentage of the total PSU award that may vest during each performance period is as follows:
| | Performance Period | | | % of Award
Eligible for Vesting | |
| | 2022 – 2023 | | | | | 15% | | |
| | 2023 – 2024 | | | | | 15% | | |
| | 2024 – 2025 | | | | | 15% | | |
| | 2022 – 2025 | | | | | 55% | | |
2023 Proxy Statement 44
The percentage of PSUs that will vest during each performance period, based on TSR performance metrics, is generally as follows:
| | Trinseo Percentile Ranking Relative to Peer Group | | | % of Target
Shares Vested* | |
| | Under 25th percentile | | | | | 0% | | |
| | 25th percentile | | | | | 50% | | |
| | 50th percentile | | | | | 100% | | |
| | 75th percentile | | | | | 200% | | |
*
Vesting is interpolated between the 25th and 50th and between the 50th and 75th percentiles
Regardless of the foregoing targets, vesting of the PSUs is capped at 100% of target if the Company’s TSR is negative for the three-year performance period. Additionally, the total value of the awards delivered at vesting is capped at three times the target shares multiplied by the grant date share price. Because the Company assumes reinvestment of dividends, dividend equivalents accrue during the performance period. However, dividend equivalents will be paid only if, and to the extent, the PSUs vest, since we do not believe the executives should receive the benefit of such dividend earnings if the performance criteria associated with the PSU award is otherwise not met. PSUs which vest during each performance period will be delivered, in aggregate, on the third anniversary of the grant date.
Upon a termination of employment due to the employee’s death or disability prior to the vesting date, the performance vesting requirements will be deemed to have been met and a pro-rated portion of the PSUs will vest based on the employee’s termination date. Upon an employee’s retirement, a pro-rated portion of the PSUs will vest based on the employee’s termination date, subject to meeting the performance vesting requirements. If an employee is terminated without cause within 2 years of a change in control, the PSUs will vest based on a meeting the performance vesting requirements during the performance period ending on the date of the change in control. In the event the employee voluntarily resigns or is terminated for cause, all unvested PSUs will be forfeited.
Stock Options. The option awards issued under the 2014 Omnibus IncentiveEquity Plan, which contain an exercise term of nine years from the grant date, vest in three equal annual installments beginning on the first anniversary the grant date, generally subject to the employee remaining continuously employed on the applicable vesting date. Upon a termination of employment due to the employee'semployee’s death or disability prior to the vesting date, or termination without cause within 2 years of a change in control, the options will vest immediately. Upon the employee’s retirement or a termination of employment by the Company without cause in connection with a restructuring or redundancy or due to the employee's disability prior to a vesting date, the options will vest in full or will continue to vest on the original vesting schedule, depending on the type of termination.schedule. In the event employmentthe employee voluntarily resigns or is terminated for cause, all vested and unvested options will be forfeited.
45 2023 Proxy Statement
TABLE OF CONTENTSTable of Contents RSUs granted under the 2014 Omnibus Incentive Plan vest in full on third anniversary of the grant date, generally subject to the employee remaining continuously employed by the Company on the vesting date. Upon a termination of employment due to the employee's death or retirement or a termination of employment by the Company without cause in connection with a restructuring or redundancy or due to the employee's disability prior to the vesting date, the RSUs will vest in full or in part, depending on the type of termination. In the event employment is terminated for cause, all unvested RSUs will be forfeited. Dividends and dividend equivalents will not accumulate on unvested RSUs.
Certain members of our management team, including some of our NEOs, continue to maintain an equity interest in our Parent as a result of previously entering into separate
Executive Subscription Agreements in accordance with the terms of their employment agreements. The Executive Subscription Agreements provide for sales of Classes A through F of the ordinary shares of our Parent (the "co-invest shares") and Classes G through L of ordinary shares of our Parent (the "incentive shares"), subject to certain conditions. Under the Executive Subscription Agreements, Messrs. Pappas, Feenan and Pugh, and Ms. Horner were granted incentive shares generally representing the right to participate in 4.5%, 0.9%, 0.4% and 0.5%, respectively, of our Parent's equity capital appreciation. Mr. Feenan's unvested awards from our Parent's equity capital appreciation program were forfeited in connection with his termination. See "—Payments upon Termination or Change in Control" below. Under the Executive Subscription Agreements, in the case of our NEOs other than Mr. Pappas, 50% of incentive shares issued are subject to time vesting as follows: Messrs. Feenan and Pugh (prior to the amendments of his arrangements as described below), 20% vesting on the first anniversary of the date of grant and the remaining portion vesting ratably on an annual basis over the following four years; Ms. Horner, (i) an initial grant of incentive shares made in 2011 with 40% vesting on the second anniversary of the date of grant and the remaining portion vesting ratably on an annual basis over the following three years and (ii) a subsequent grant of incentive shares made in 2013 with 33.33% vesting on each of the first three anniversaries of the date of grant. For Mr. Pappas, 75% of his incentive shares were subject to time vesting with 25% vesting on June 17, 2011 and the balance vesting ratably on a quarterly basis over the following three years. The remaining 50% of the incentive shares (25% for Mr. Pappas) were originally subject to both time vesting, in the same manner as previously described, and performance vesting subject to achieving certain targets based on various returns realized by our shareholders upon a change in control or the completion of an IPO. In 2013, Mr. Pappas entered into an amended and restated Executive Subscription Agreement in accordance with the terms of his amended employment agreement. Under the agreement Mr. Pappas was awarded additional incentive shares that are subject solely to a time-based vesting condition with 40% vesting on June 30, 2014 and the remaining portion vesting on an annual basis over the subsequent three years.
Prior to the completion of our IPO, we entered into agreements (the "letter agreements") to modify the outstanding performance-based incentive shares held by our employees, including our NEOs. The letter agreements, which were approved by our Board, removed the performance-based vesting condition associated with such shares related to the achievement of certain investment returns and modified the time-based vesting schedule associated with such shares to provide that any such shares that would have satisfied the time-based vesting condition previously applicable to such shares on or prior to June 30, 2017 will instead vest on June 30, 2017, subject to the holder remaining continuously employed by us through such date. Any such shares that are subject to a time-based vesting condition beyond June 30, 2017 will remain subject to the time-based vesting condition previously applicable to such award. Upon completion of our IPO, these shares became time-based restricted share awards, and we refer to them as modified time-based restricted share awards. The remaining incentive shares are referred to as historical time-based restricted share awards.
In October 2014, Mr. Pugh entered into a second amendment to his Executive Subscription Agreement whereby his historical time-based restricted share awards will vest with respect to 20% of
Compensation
Table of Contents
each class on each of the first and second anniversaries of March 1, 2013 and with respect to 30% of each class on the third and fourth anniversaries of such date such that all historical time-based restricted share awards would become 100% vested on March 1, 2017. The vesting schedule with respect to Mr. Pugh's modified time-based restricted share awards was further amended to provide that each class of shares shall satisfy the time-based vesting condition on the earlier of March 1, 2017 or a sale of the Company, in each case, if Mr. Pugh is then employed by us or our subsidiaries.
All of the incentive shares are subject to the applicable executives remaining employed by us between the date of the applicable Executive Subscription Agreement and the applicable vesting date; provided that, if any of our NEOs (other than Mr. Pappas) dies, is terminated without cause or due to his or her disability, or resigns for good reason after the second anniversary of the date of grant, the portion of the historical time-based restricted share awards that would have vested on the next regular vesting date will accelerate and vest on a pro rata basis based on the number of full months between the last regular vesting date and the termination date. If Mr. Pappas dies, is terminated without cause or due to his disability, or resigns for good reason, the portion of his historical time-based restricted share awards that would have vested during the 12 months following the termination date will accelerate and vest. All incentive shares will vest automatically upon a change in control of the Company.
In February 2011, in connection with the refinancing of our previous $800 million term loan under the Senior Secured Credit Facility, our Board declared a one-time cash distribution. The distribution was made by way of redemption and cancellation of the class A and class G shares. The NEOs, to the extent they held co-invest shares and incentive shares, received an equivalent payment in 2011. For those hired after June 17, 2010, a portion of the distribution attributable to unvested time-based incentive shares was withheld and put in escrow, to be paid out in connection with the anniversary of their date of hire, subject to the NEO's continued employment with the Company. For those hired after June 17, 2010 but during 2010, 50% of the time-based incentive share distribution was paid in February 2011 and 50% was paid on their next anniversary date in 2012. For executives hired in 2011, 100% of the distribution was payable on their second anniversary date. For all holders of performance-based incentive shares redeemed and cancelled, a portion of the distribution was withheld and put in escrow. These will be paid out on June 30, 2017 subject to employment conditions as set out in the letter agreements. There were no distributions for the years ended December 31, 2014 and 2015.
Each NEO is (or was) entitled to participate in our employee and fringe benefit plans as may be in effect from time to time on the same general basis as our other employees.
Outstanding Equity Awards at Fiscal Year-End Table The table below sets forth certain information regarding outstanding and unvested equity awards held by the NEOs as of December 31, 2015.2022. The stock awards include both shares with respect our Parent and our publicly traded equity for all NEOs, except Messrs. Feenan and Chaclas. As of December 31, 2015, Mr. Feenan had forfeited his unvested equity awards under our 2014 Omnibus Incentive Plan. Mr. Chaclas has not received an equity awards with respect to our Parent.
Table of Contents
Unless otherwise footnoted below, the awards below in our publicly traded equity arerepresent RSUs, PSUs, and options issued under our Amended & Restated 2014 Omnibus Incentive Plan.
| | | | | | | | | | | Option Awards | | | Stock Awards | |
| | Name | | | Grant
Date | | | Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable | | | Equity Incentive
Plan Awards:
Number of
Securities
Underlying
Unexercised
Options (#) (1)
Unexercisable | | | Option
Exercise
Price
($) | | | Option
Expiration
Date | | | Number of
shares or
units of
stock that
have not
vested
(#) (2) | | | Market value
of shares or
units of
stock that
have not
vested
($) (3) | | | Equity Incentive
Plan Awards:
Number of
Unearned
Shares, Units,
or Other Rights
that have Not
Vested
(#) (4) | | | Equity Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares, Units
or Other Rights
that have Not
Vested
($) (3) | |
| | Frank Bozich | | | | | 2/16/2022 | | | | | | — | | | | | | 52,746 | | | | | | 58.64 | | | | | | 2/16/2031 | | | | | | 20,413 | | | | | | 463,579 | | | | | | 27,217 | | | | | | 618,098 | | |
| | | | 2/17/2021 | | | | | | 15,584 | | | | | | 31,169 | | | | | | 61.06 | | | | | | 2/17/2030 | | | | | | 17,626 | | | | | | 400,286 | | | | | | 23,501 | | | | | | 533,708 | | |
| | | | 2/25/2020 | | | | | | — | | | | | | 41,915 | | | | | | 24.30 | | | | | | 2/25/2029 | | | | | | 33,951 | | | | | | 771,027 | | | | | | 45,267 | | | | | | 1,028,014 | | |
| | | | 3/4/2019 | | | | | | 53,440 | | | | | | — | | | | | | 50.95 | | | | | | 3/4/2028 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | David Stasse | | | | | 2/16/2022 | | | | | | — | | | | | | 14,541 | | | | | | 58.64 | | | | | | 2/16/2031 | | | | | | 5,628 | | | | | | 127,812 | | | | | | 7,503 | | | | | | 170,393 | | |
| | | | 2/17/2021 | | | | | | 3,953 | | | | | | 7,906 | | | | | | 61.06 | | | | | | 2/17/2030 | | | | | | 4,471 | | | | | | 101,536 | | | | | | 5,961 | | | | | | 135,374 | | |
| | | | 2/25/2020 | | | | | | 11,431 | | | | | | 11,432 | | | | | | 24.30 | | | | | | 2/25/2029 | | | | | | 9,259 | | | | | | 210,272 | | | | | | 12,346 | | | | | | 280,378 | | |
| | | | 2/26/2019 | | | | | | 3,847 | | | | | | — | | | | | | 51.02 | | | | | | 2/26/2028 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | | | 2/22/2018 | | | | | | 3,847 | | | | | | — | | | | | | 81.20 | | | | | | 2/22/2027 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | | | 2/16/2017 | | | | | | 2,530 | | | | | | — | | | | | | 71.45 | | | | | | 2/16/2026 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | Angelo Chaclas | | | | | 2/16/2022 | | | | | | — | | | | | | 9,617 | | | | | | 58.64 | | | | | | 2/16/2031 | | | | | | 3,722 | | | | | | 84,527 | | | | | | 4,962 | | | | | | 112,687 | | |
| | | | 2/17/2021 | | | | | | 2,997 | | | | | | 5,995 | | | | | | 61.06 | | | | | | 2/17/2030 | | | | | | 3,390 | | | | | | 76,987 | | | | | | 4,520 | | | | | �� | 102,649 | | |
| | | | 2/25/2020 | | | | | | 20,347 | | | | | | 10,174 | | | | | | 24.30 | | | | | | 2/25/2029 | | | | | | 8,241 | | | | | | 187,153 | | | | | | 10,988 | | | | | | 249,537 | | |
| | | | 2/26/2019 | | | | | | 12,996 | | | | | | — | | | | | | 51.02 | | | | | | 2/26/2028 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | | | 2/22/2018 | | | | | | 8,182 | | | | | | — | | | | | | 81.20 | | | | | | 2/22/2027 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | | | 2/16/2017 | | | | | | 8,253 | | | | | | — | | | | | | 71.45 | | | | | | 2/16/2026 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | Andre Lanning | | | | | 2/16/2022 | | | | | | — | | | | | | 9,339 | | | | | | 58.64 | | | | | | 2/16/2031 | | | | | | 3,614 | | | | | | 82,074 | | | | | | 4,819 | | | | | | 109,439 | | |
| | | | 2/17/2021 | | | | | | 1,567 | | | | | | 3,135 | | | | | | 61.06 | | | | | | 2/17/2030 | | | | | | 1,773 | | | | | | 40,265 | | | | | | 2,364 | | | | | | 53,686 | | |
| | | | 2/25/2020 | | | | | | 4,028 | | | | | | 2,014 | | | | | | 24.30 | | | | | | 2/25/2029 | | | | | | 3,807 | | | | | | 86,457 | | | | | | — | | | | | | — | | |
| | Paula Cooney | | | | | 2/16/2022 | | | | | | — | | | | | | 7,932 | | | | | | 58.64 | | | | | | 2/16/2031 | | | | | | 3,070 | | | | | | 69,720 | | | | | | 4,093 | | | | | | 92,952 | | |
| | | | 11/29/2021 | | | | | | — | | | | | | — | | | | | | 24.30 | | | | | | 2/25/2029 | | | | | | 4,039 | | | | | | 91,726 | | | | | | — | | | | | | — | | |
| | | | | | | | | | | | | | | | | | | | | | |
| | Option Awards | |
| |
| |
|---|
| |
| |
| | Equity
Incentive Plan
Awards:
Number of
Securities
Underlying
Unexercised
Options (#)(1)
Unexercisable | |
| |
| |
| |
| |
|---|
| |
| | Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable | |
| |
| | Stock Awards | |
|---|
Name | | Grant
Date | | Option
Exercise
Price
($) | | Option
Expiration
Date | | Number of Shares
or Units of Stock
that have Not
Vested (#)(4) | | Market Value of
Shares or Units of
Stock that have
Not Vested ($)(5) | |
|---|
Christopher D. Pappas | | | 2/27/2015 | | | — | | | 272,391 | | | 18.14 | | | 2/27/2024 | | | — | | | — | |
| | | 2/27/2015 | | | — | | | — | | | — | | | — | | | 115,776 | | $ | 3,264,883 | |
| | | 6/10/2014 | (2) | | — | | | — | | | — | | | — | | | 24,206 | | $ | 2,822,372 | |
| | | 4/18/2013 | (2) | | — | | | — | | | — | | | — | | | 29,048 | | $ | 3,387,020 | |
Martin Pugh | | |
2/27/2015 | | |
— | | |
57,944 | | |
18.14 | | |
2/27/2024 | | |
— | | |
— | |
| | | 2/27/2015 | | | — | | | — | | | — | | | — | | | 24,626 | | $ | 694,453 | |
| | | 6/10/2014 | (2) | | — | | | — | | | — | | | — | | | 7,745 | | $ | 903,009 | |
| | | 3/1/2013 | (2) | | — | | | — | | | — | | | — | | | 4,647 | | $ | 541,840 | |
Marilyn N. Horner | | |
2/27/2015 | | |
— | | |
35,411 | | |
18.14 | | |
2/27/2024 | | |
— | | |
— | |
| | | 2/27/2015 | | | — | | | — | | | — | | | — | | | 15,050 | | $ | 424,410 | |
| | | 6/10/2014 | (2) | | — | | | — | | | — | | | — | | | 9,682 | | $ | 1,128,921 | |
| | | 1/1/2013 | (2) | | — | | | — | | | — | | | — | | | 969 | | $ | 112,985 | |
| | | 1/14/2011 | (2) | | — | | | — | | | — | | | — | | | 1,355 | | $ | 157,993 | |
Angelo N. Chaclas | | |
2/27/2015 | | |
— | | |
23,672 | | |
18.14 | | |
2/27/2024 | | |
— | | |
— | |
| | | 2/27/2015 | | | — | | | — | | | — | | | — | | | 10,061 | | $ | 283,720 | |
Option awards under the 2014 Omnibus Incentive Plan vest in three equal installments beginning on the first anniversary of the grant date.
(2)Footnoted awards reflect both historical and modified time-based restricted share awards with respect to Parent stock granted to certain NEOs pursuant to the Executive Subscription Agreements and employment agreements, and amendments thereto. The vesting provisions applicable to the historical and modified-time based restricted share awards for each of the NEOs are as follows.
Historical time-based restricted share awards. The historical time-based restricted share awards are subject to time vesting as follows: Mr. Pappas, 40% of his award vested on June 30, 2014 with the remaining portion vesting ratably on an annual basis over the subsequent three years; Mr. Pugh, 20% vesting on the first and second anniversaries of the date of grant, and 30% vesting on the third and fourth anniversaries of the date of grant; and Ms. Horner, (i) an initial grant of incentive shares made in 2011 with 40% vesting on the second anniversary of the date of grant and the remaining portion vesting ratably on an annual basis over the following three years, and (ii) a subsequent grant of incentive shares made in 2013 with 33.33% vesting on each of the first three anniversaries of the date of grant.
Modified time-based restricted share awards. Prior to the completion of our IPO, in June 2014 the performance-based restricted share awards (as described above) were modified, and upon completion
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of the IPO, these shares became time-based restricted share awards, which we now refer to as modified time-based restricted share awards. Additionally, in October 2014, Mr. Pugh entered into a second amendment to his Executive Subscription Agreement, which resulted in modification to the vesting schedule of his modified time-based restricted share awards. In the case of Messrs. Pappas and Ms. Horner, 100% of the modified time-based restricted share awards vest on June 30, 2017. In the case of Mr. Pugh, 100% of the modified time-based restricted share awards vest on March 1, 2017. In accordance with the terms of his Separation Letter Agreement, Mr. Feenan's modified time-based restricted share awards were forfeited on December 31, 2015, coinciding with the termination of his employment.
Vesting of both the historical and modified time-based restricted share awards for each of the participating NEOs is generally subject to the executive's continued employment with the Company. For the historical time-based restricted share awards, if any of our NEOs (other than Mr. Pappas) dies, is terminated without cause or due to his or her disability, or resigns for good reason after the second anniversary of the date of grant, the portion of the historical time-based restricted share awards that would have vested on the next regular vesting date will accelerate and vest on a pro rata basis based on the number of full months between the last regular vesting date and the termination date. If Mr. Pappas dies, is terminated without cause or due to his disability, or resigns for good reason, the portion of his historical time-based restricted share awards that would have vested during the 12 months following the termination date will accelerate and vest. Outstanding andThis column represents unvested historical and modified time-based restricted share awards will vest automatically upon a change in control of the Company.
The remaining outstanding historical and modified time-based restricted share awards for each of the NEOs will vest as set forth below:
| | | | | | | |
| | Number of
Shares | | Vesting
Date | |
|---|
Christopher D. Pappas | | | 14,524 | | | 6/30/2016 | |
| | | 14,524 | | | 6/30/2017 | |
| | | 24,206 | | | 6/30/2017 | (3) |
Martin Pugh | | |
2,324 | | |
3/1/2016 | |
| | | 2,323 | | | 3/1/2017 | |
| | | 7,745 | | | 3/1/2017 | (3) |
Marilyn N. Horner | | |
2,324 | | |
1/5/2016 | |
| | | 9,682 | | | 6/30/2017 | (3) |
(3)Represents vesting of the modified time-based restricted share awards for the respective NEO, as described above.
(4)- RSUs. All RSU awards vest in full on the third anniversary of the grant
date.
(5)The market value of grants in our Parent shares were determined based on the fair value of our Parent shares as of December 31, 2015 of $116.60 per share, as calculated by an independent valuation expert. date except for Ms. Cooney’s sign-on award, granted November 2021, which vests ratably over three years.
(3)
The market value of the RSU and PSU awards made under the 2014 Omnibus Incentive Plan was calculated using the Company'sCompany’s closing stock price on December 31, 20152022 of $28.20.$22.71.
(4)
This column represents unvested PSUs. All PSU awards granted in 2020 vest in full on the third anniversary of the grant date, subject to achieving certain TSR performance metrics. PSU awards granted in 2021 and 2022 vest during four performance periods, consisting of three one-year performance periods and one three-year performance period, which are each measured independently, subject to achieving certain TSR performance metrics. The number of the PSUs that vest upon completion of the performance period can range from 0 to 200% of the original grant. The number of unvested PSUs was calculated assuming target (100%) achievement.
2023 Proxy Statement 46
Options Exercised and Shares Vested Table During 2015, no options were exercised by our NEOs and no awards held by our NEOs in shares of our Company's publicly traded equity vested.
| | | | | Option Awards | | | Share Awards | |
| | Name | | | Number of
Options Exercised
(#) | | | Value Realized
on Exercise
($) | | | Number of Shares
Acquired on Vesting
(#) | | | Value Realized
on Vesting
($) | |
| | Frank A. Bozich | | | | | 83,828 | | | | | | 2,156,405 | | | | | | 71,678 | | | | | | 3,263,072 | | |
| | David Stasse | | | | | — | | | | | | — | | | | | | 4,066 | | | | | | 218,832 | | |
| | Angelo N. Chaclas | | | | | — | | | | | | — | | | | | | 8,484 | | | | | | 410,973 | | |
| | Andre Lanning | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | Paula Cooney | | | | | — | | | | | | — | | | | | | 2,019 | | | | | | 49,082 | | |
| | | | | | | |
| | Share Awards | |
|---|
Name | | Number of
Shares
Acquired on
Vesting (#)(1) | | Value Realized
on Vesting ($)(2) | |
|---|
Christopher D. Pappas | | | 14,524 | | $ | 811,892 | |
John A. Feenan(3) | | | 6,969 | | $ | 600,985 | |
Martin Pugh | | | 1,549 | | $ | 86,589 | |
Marilyn N. Horner | | | 2,324 | | $ | 129,912 | |
Angel N. Chaclas | | | N/A | | $ | — | |
(1)All restricted share awards with respect to our Parent's ordinary shares acquired on vesting during fiscal year 2015 were historical time-based restricted share awards.
(2)The value realized on vesting is based on the fair value per share of our Parent's ordinary shares on the date of vesting.
(3)In accordance with his Separation Letter Agreement, Mr. Feenan vested in certain additional restricted share awards with respect to our Parent's ordinary shares.
U.S. Non-Qualified Deferred Compensation Table
The following table summarizes the activity during 2015,2022, as well as the year-end account balances, in our non-qualified savings and deferred compensation plan for our NEOs.Ms. Cooney and Messrs. Bozich, Stasse and Chaclas. Mr. Lanning is based in Switzerland and was not eligible to participate in this plan. The plan allows eligible employees, including the NEOs, to defer a portion of their compensation (up to 75% of base salary and up to 100% of annual cash incentive awards) on a pre-tax basis with a matching contribution from the Company, payable at a future date based on specific plan parameters. Additionally, the plan provides for discretionary company contributions in connection with earnings in excess of the limits under the Company'sCompany’s 401(k) Plan.plan. While the plan is unfunded, amounts deferred under the plan are credited with earnings based on the performance of selected investment vehicles that are available in the open market. The plan is available to all U.S. employees who satisfy certain eligibility requirements, including the NEOs. An eligible participant can elect to receive a distribution under the plan in the form of a lump sum payment upon separation from service with the Company. Additionally, a participant may elect to receive a distribution at a specified future date in either a single lump sum or a series of annual installments over a period of 5 to 10 years. However, this latter distribution option is only available for the elective deferral of a participant'sparticipant’s base salary and annual cash incentive award.
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Company matching and discretionary contributions must be paid as a lump sum at separation from employment.
| | Name | | | Executive
Contributions
in 2022
($) (1) | | | Company
Contributions
in 2022
($) (2) | | | Aggregate
Earnings
in 2022
($) (3) | | | Aggregate
Withdrawals/
Distributions
in 2022
($) | | | Aggregate
Balance as of
December 31,
2022
($) (4) | |
| | Frank Bozich | | | | | — | | | | | | 106,250 | | | | | | 2,041 | | | | | | — | | | | | | 209,049 | | |
| | David Stasse | | | | | — | | | | | | 33,625 | | | | | | 1,700 | | | | | | — | | | | | | 173,998 | | |
| | Angelo N. Chaclas | | | | | — | | | | | | 27,938 | | | | | | 9,376 | | | | | | — | | | | | | 222,577 | | |
| | Paula Cooney | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | | | | | | | | | | | | | | | |
Name | | Executive
Contributions
in 2015 ($)(1) | | Company
Contributions
in 2015 ($)(2) | | Aggregate
Earnings
in 2015 ($)(3) | | Aggregate
Withdrawals/
Distributions
in 2015($) | | Aggregate
Balance as of
December 31, 2015 ($)(4) | |
|---|
Christopher D. Pappas | | $ | 184,411 | | $ | 141,150 | | $ | 12,941 | | $ | — | | $ | 1,225,036 | |
John A. Feenan | | $ | — | | $ | 39,250 | | $ | — | | $ | — | | $ | 91,795 | |
Martin Pugh(5) | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | |
Marilyn N. Horner | | $ | 25,200 | | $ | 26,550 | | $ | 296 | | $ | — | | $ | 242,833 | |
Angelo N. Chaclas | | $ | — | | $ | 15,038 | | $ | 3 | | $ | — | | $ | 28,040 | |
Represents amountsthe amount contributed by the NEOs under the non-qualified savings and deferred compensation plan. These amounts areThis amount is included in the Summary Compensation Table as part of "Salary."
“Salary”.
(2)
Includes matching and discretionary amounts that were contributed by the Company under the non-qualified savings and deferred compensation plan. These amounts are also included in the Summary Compensation Table in the "All“All Other Compensation"Compensation” column.
(3)
Represents earnings on account balances under the Company'sCompany’s non-qualified savings and deferred compensation plan. Amounts are not reportedincluded as compensation in the Summary Compensation Table.
(4)
Includes amounts that were reported as compensation in the Summary Compensation Table in 20152022 and prior years to the extent such amounts were contributed by the executive and the Company, but not to the extent that such amounts represent earnings.
(5)Mr. Pugh is based in Switzerland and does not participate in this plan.
47 2023 Proxy Statement
Pension and Other Postretirement Benefits
Switzerland Retirement Plan The Switzerland retirement plan is a fully insured defined contribution pension plan. Future retirement benefits are calculated based on accumulated savings at retirement, which consists of savings contributions made by the employee and the Company, and an annually credited interest rate that is contingent upon investment results. Actual retirement benefits will be dependent on investment results, actual rate of interest applied on the savings capital, potential future changes in plan regulation and/or legal changes and future salary changes. The amount of pensionable salary is calculated using base pay plus the annual target bonus amount minus a coordination amount that reflects the maximum social security pension in place at the time, and is subject to a statutory maximum. Employee and Company contributions are based on the employee'semployee’s age and determined in accordance with the percentage of pensionable salary as follows:
| | Name | | | Employee saving contributions
in % of pensionable salary | | | Employer saving contributions
in % of pensionable salary | |
| | Andre Lanning | | | | | 10.00% | | | | | | 10.00% | | |
| | | | | | | |
Name | | Employee saving
contributions
in % of
pensionable salary | | Employer saving
contributions
in % of
pensionable salary | |
|---|
Martin Pugh | | | 10.00 | % | | 10.00 | % |
In addition, the employerCompany pays the total premiums for risk benefits and other costs. It is assumed that these additional contributions equal 4.0% of insured salary. Benefits are paid as a monthly annuity, lump sum or a combination of thethese two payment forms.
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Supplemental Employee Retirement Benefit
In 2010, we entered into an employment contract with Mr. Pappas which included a provision for non-qualified supplemental employee retirement benefits. Mr. Pappas is 100% vested in these benefits and the accrued benefits will be paid to Mr. Pappas in a lump sum within 30 days after his termination of employment. The amount payable to Mr. Pappas with respect to his supplemental employee retirement benefits is determined based on his years of Service Credit and his average base salary and target bonus for the three full calendar years prior to his termination. The accrued benefits are equal to the Basic Percentage times the average of his base salary plus target bonus for the three full calendar years prior to his termination (the "Final Average Pay") plus the Supplemental Percentage times the Final Average Pay reduced by the 36-month rolling average Social Security Taxable Wage Base as of the date of termination. As of December 31, 2015, Mr. Pappas had thirty (30) years of Service Credit with the Company. The Basic Percentage and Supplemental Percentage are determined based on Mr. Pappas' years of Service Credit, which are 425% and 120%, respectively.
The following table shows the actuarial present value of accumulated pension and other post-retirement benefits as of December 31, 2015:2022:
| | Name | | | Plan Name | | | Number of Years
of Credited Service
(#) | | | Present Value of
Accumulated Benefit
($) (1) (2) (3) | | | Payments
During 2022
($) | |
| | Andre Lanning | | | Switzerland Retirement Plan | | | | | 2.5 | | | | | | 510,668 | | | | | | — | | |
| | | | | | | | | | | | |
Name | | Plan Name | | Number of
Years of
Credited
Service (#)(1) | | Present
Value of
Accumulated
Benefit ($)(2) | | Payments
During
2015 ($) | |
|---|
Christopher D. Pappas | | Supplemental Employee Retirement Plan | | | 30.0 | | $ | 13,469,231 | | $ | — | |
John A. Feenan | | N/A | | | — | | $ | — | | $ | — | |
Martin Pugh | | Switzerland Retirement Plan | | | 9.5 | | $ | 1,811,383 | | $ | — | |
Marilyn N. Horner | | N/A | | | — | | $ | — | | $ | — | |
Angelo N. Chaclas | | N/A | | | — | | $ | — | | $ | — | |
Mr. Lanning’s accumulated benefit is calculated in CHF and was converted using the foreign exchange rate of US$1.0486 to CHF1.00. This rate was determined by averaging the monthly exchange rates in effect during 2022.
(2)
The years of credited service for Mr. Pappas are determined pursuant to his employment agreement, under which he was granted 6 years of Service Credit at the start of his employmentinputs and on each anniversary date, until he reached a maximum of 30 years. Mr. Pugh's years of credited service include years that he was employed by a prior company, as required by Swiss law.
(2)The assumptions used to determine the present value of accumulated benefits, if any, are provided in the table below. These assumptions are consistent with the assumptions set forth in Note 1617 to the 20152022 consolidated financial statements filed with our Annual Report on Form 10-K.
| | | | | Discount rate | | | Salary increase | |
| | Switzerland Retirement Plan | | | | | 2.16% | | | | | | 2.25% | | |
| | | | | | | |
| | Discount rate | | Salary increase | |
|---|
Supplemental Employee Retirement Plan | | | 1.20 | % | | 4.00 | % |
Switzerland Retirement Plan | | | 1.00 | % | | 2.25 | % |
Payments upon Termination or Change in Control
Messrs. Pappas,Bozich, Stasse and Chaclas and Ms. HornerCooney
In the event of an executive'sexecutive’s termination of employment for any reason, Messrs. PappasBozich, Stasse and Chaclas and Ms. HornerCooney will each be entitled to receive any unpaid base salary through the date of termination and all accrued and vested benefits under our vacation and other benefit plans and, except in the case of a termination by us for "cause"“cause” or by the executive without "good reason"“good reason” (each, as defined in the executive'sexecutive’s employment agreement), (i) any annual bonus earned but unpaid with respect to the calendar year ending on or preceding the date of termination and (ii) a pro rata target bonus for the calendar year of termination.
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Under Mr. Pappas' agreement, in the event of his voluntary termination of employment without "good reason," he shall provide the Company with one year's written notice. In the event his termination date is less than one year following his written notice of termination, Mr. Pappas would not receive the pro rata target bonus for the calendar year of termination. In addition, the Company may purchase all or a portion of his incentive shares granted to him in 2013 at the lower of their fair market value or the original cost.
In addition to the severance benefits described above, upon termination of an executive without "cause"“cause” or by the executive for "good“good reason,"” the executive will be (or was) entitled to receive the following severance benefits, subject to the executive'sexecutive’s timely execution of a general release of claims.
In the case of Mr.
Pappas, he willBozich, in the event of his termination by the Company without “cause” or if Mr. Bozich terminated his employment for “good reason”, Mr. Bozich would be entitled to receive
a severance payment equal to 2.0 times
the sum of his annual base salary and target bonus, payable in equal monthly installments over the
24 month24-month period following
such termination, and, ifhis termination. Additionally, Mr.
PappasBozich is
participating in the Company's health plans at the time of his termination,eligible to receive continued health benefits for a period of 24 months following such termination, provided, however, that if he obtains other employment that offers group health benefits, such continued insurance coverage will
terminate.terminate, or enrolls in coverage through Medicare, a spousal plan, or an insurance exchange other than COBRA, the Company will pay Mr. Bozich the amount equivalent to the Company’s share of COBRA premiums for 24 months as if Mr. Bozich had enrolled in COBRA. To the extent that Mr. Bozich experiences a termination of employment by us without “cause” or for “good reason” within two years following a “change in control” (as defined in his agreement), the
2023 Proxy Statement 48
cash severance benefits described above will be (or would have been) equal to 3.0 times his annual base salary and target bonus, paid in a cash lump sum as opposed to in installments.
In the case of Mr. Stasse, Mr. Chaclas and Ms. Horner,Cooney, each will be entitled to receive, subject to the timely execution of a general release of claims (i) an amounta lump sum severance payment equal to 1.52.0 times the sum of theirhis or her respective base salariessalary and target bonuses,bonus, payable in equal monthly installments over the 18 month24-month period following suchhis or her termination, and (ii) 18 months of health benefits continuation, provided, however, that if the executivehe or she obtains other employment that offers group health benefits, such continued insurance coverage will terminate with respect to such executive.terminate. To the extent that any executive experiences (or experienced) a termination of employment by us without "cause"“cause” or by the executive for "good reason"“good reason” within two years following a "change“change in control" (ascontrol” (as defined in the agreements), the cash severance benefits described above will be (or would have been) paid to such executive in a cash lump sum as opposed to in installments. In addition, in the case of Mr. Pappas, to the extent that the severance payments
For Messrs. Bozich, Stasse and benefits payable under his agreement would cause him to be liable for excise taxes by reason of the application of Sections 280GChaclas and 4999 of the Code, and the Company's equity securities are publicly traded on an established securities market in accordance with Section 280G, Mr. Pappas will be entitled to an additional "gross up" payment to indemnify him for the effect of the excise taxes. For Ms. Horner and Mr. Chaclas,Cooney, to the extent that any payments that are considered to be contingent on a change in control would be subject to Sections 280G and 4999 of the Code, such payments will be limitedreduced if the net benefit to the executivethem on an after-tax basis would be greater than receiving the full value of all payments and paying the excise tax. The amounts in the table assume that the full amounts were paid to the executives, without any limitation.
To the extent that any portion of Messrs. Bozich’s, Stasse’s and Chaclas’ or Ms. Cooney’s severance amount due to a termination of employment by us without “cause” or by the executive for “good reason” constitutes nonqualified deferred compensation for purposes of Section 409A of the Internal Revenue Code, any payment scheduled to occur during the first 60 days following his termination of employment shall not be paid until the 60th day following his termination.
The agreements with Messrs. PappasBozich, Stasse and Chaclas and Ms. HornerCooney contain a non-competition covenant that prohibits the executive from competing against us for a period of one year (or two years in the case of Mr. Pappas) following termination of employment. These agreements also contain non-solicitation provisions that prohibit the executive from actively soliciting our employees, customers or suppliers during the period of employment and for a period of one year (or two years in the case of Mr. Pappas) following termination of employment. The executives are also subject to perpetual confidentiality restrictions that protect our proprietary information, developments and other intellectual property.
In the event of termination of his employment for any reason, Mr. PughLanning will be entitled to receive any unpaid base salary through thehis date of termination and all accrued and vested benefits under our vacation and other benefit plans and, except in the case of a termination by us for "cause"“cause” or by him
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without "good reason" (each, as defined in his employment agreement)the executive (i) any annual bonus earned but unpaid with respect to the calendar year ending on or preceding the date of termination; and (ii) an amount equal to the pro-rata portion of his target bonus for the calendar year of termination (determined by multiplying the target bonus for the year of termination by a fraction, the numerator of which is the number of days during the calendar year of termination that he is employed by the Company and the denominator of which is 365).termination. Mr. PughLanning will also each receive payments required by applicable law upon a termination by reason of disability, as described in the preceding table.
table below.
In addition to the severance benefits described above, upon termination of Mr. Pugh's terminationLanning by us without "cause" or by him for "good reason," Mr. Pugh“cause”, he will be entitled to receive the following severance benefits, subject to his timely execution of a general release of claims inclaims. Mr. Lanning’s severance benefits will be an amount equal to 1.5 times of the sum of his annual base salary and target bonus.bonus, payable in equal monthly installments over the 18-month period following such termination. To the extent that Mr. Pughhe experiences a termination of employment by us without "cause"“cause” or by him for "good reason"“good reason” within two years following a "change“change in control" (ascontrol” (as defined in his agreement), the cash severance benefits described aboveMr. Lanning will be paid to him inreceive a cash lump sum as opposedpayment equal to in installments. The2.0 times the sum of his base salary and target bonus.
Mr. Lanning’s employment agreement contains a non-competition covenant that prohibits Mr. Pughhim from competing against us, for a period of 18 months following his termination of employment. The agreement also containsand non-solicitation provisions that prohibit him from actively soliciting our employees, customers or suppliers, during the period of employment and for a period of 6 monthstwo years, following his termination.termination of employment. Mr. PughLanning is also subject to perpetual confidentiality restrictions that protect our proprietary information, developments and other intellectual property.Mr. Feenan
On November 16, 2015, Mr. Feenan and the Company executed a Separation Letter Agreement. Under this agreement, Mr. Feenan's $600,000 per year base salary was continued through December 31, 2015 and he was paid in 2016 an annual performance award of $720,000 that he would have otherwise earned had he continued in this role through the end of the year. Additionally, the Separation Letter Agreement provides Mr. Feenan with 18 months of health benefits continuation, valued at $21,654, with such coverage terminating if he obtains employment that offers group health benefits. Under the Separation Letter Agreement, all of his unvested equity awards in our Parent and RSU and options issued under the 2014 Omnibus Incentive Plan were forfeited. His Separation Letter Agreement incorporates the same 12 month non-competition and non-solicitation provisions described above for Mr. Chaclas and Ms. Horner.
The following table provides examples of the potential payments upon termination or upon a termination following a change in control to our NEOs, (other than Mr. Feenan), as if such event(s) took place on December 31, 20152022 (the last business day of our most recent fiscal year). The amounts reflected in this table were determined in accordance with each NEO'sNEO’s then existing employment agreement.
Amounts shown do not include (i) accrued but unpaid salary and vested benefits, including pension (as described above) and (ii) other benefits earned or accrued by the named executive officer during his or her employment that are available to all salaried employees and that do not discriminate in scope, terms or operations in favor of executive officers. With respect to any termination of employment, each NEO is entitled to receive accrued but unpaid base salary through the date of termination of employment, accrued but unpaid
49 2023 Proxy Statement
vacation and pension benefits (as described above) through such date, and, in the case of Mr. Chaclas and Ms. Horner, in the case of a termination due to
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death, earned but unpaid bonus, if any, for the immediately preceding calendar year and a pro-rata bonus for the year of termination.
| | Name | | | Termination Trigger | | | Cash
Separation
Payment
($) (1) | | | Health and
Welfare
Benefits
($) (2) | | | Value of
Previously
Unvested
Equity Awards
($) (3) | | | Value of
Insurance
Benefit
($) (4) | | | 2022
Target Cash
Compensation
($) (5) | | | Cash
Separation
Payment
Multiple | |
| | Frank Bozich | | | Termination for Cause | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | Termination Without Cause | | | | | 4,830,000 | | | | | | 15,968 | | | | | | 1,223,462 | | | | | | — | | | | | | 2,415,000 | | | | | | 2 | | |
| | Death | | | | | — | | | | | | — | | | | | | 3,419,974 | | | | | | 500,000 | | | | | | — | | | | | | — | | |
| | Disability | | | | | — | | | | | | 15,968 | | | | | | 3,419,974 | | | | | | 250,000 | | | | | | — | | | | | | — | | |
| | Change in Control | | | | | 7,245,000 | | | | | | 15,968 | | | | | | 4,173,643 | | | | | | — | | | | | | 2,415,000 | | | | | | 3 | | |
| | David Stasse | | | Termination for Cause | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | Termination Without Cause | | | | | 1,443,750 | | | | | | 20,636 | | | | | | 329,037 | | | | | | — | | | | | | 962,500 | | | | | | 1.5 | | |
| | Death | | | | | — | | | | | | — | | | | | | 919,760 | | | | | | 500,000 | | | | | | — | | | | | | — | | |
| | Disability | | | | | — | | | | | | 20,636 | | | | | | 919,760 | | | | | | 250,000 | | | | | | — | | | | | | — | | |
| | Change in Control | | | | | 1,925,000 | | | | | | 20,636 | | | | | | 1,122,411 | | | | | | — | | | | | | 962,500 | | | | | | 2 | | |
| | Angelo Chaclas | | | Termination for Cause | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | Termination Without Cause | | | | | 1,273,125 | | | | | | 16,227 | | | | | | 275,582 | | | | | | — | | | | | | 848,750 | | | | | | 1.5 | | |
| | Death | | | | | — | | | | | | — | | | | | | 750,698 | | | | | | 500,000 | | | | | | — | | | | | | — | | |
| | Disability | | | | | — | | | | | | 16,227 | | | | | | 750,698 | | | | | | 250,000 | | | | | | — | | | | | | — | | |
| | Change in Control | | | | | 1,697,500 | | | | | | 16,227 | | | | | | 894,255 | | | | | | — | | | | | | 848,750 | | | | | | 2 | | |
| | Andre Lanning | | | Termination for Cause | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | Termination Without Cause | | | | | 1,195,783 | | | | | | — | | | | | | 142,859 | | | | | | — | | | | | | 797,189 | | | | | | 1.5 | | |
| | Death | | | | | — | | | | | | — | | | | | | 293,995 | | | | | | — | | | | | | — | | | | | | — | | |
| | Disability | | | | | — | | | | | | — | | | | | | 293,995 | | | | | | — | | | | | | — | | | | | | — | | |
| | Change in Control | | | | | 1,594,378 | | | | | | — | | | | | | 398,872 | | | | | | — | | | | | | 797,189 | | | | | | 2 | | |
| | Paula Cooney | | | Termination for Cause | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | Termination Without Cause | | | | | 1,200,000 | | | | | | 15,968 | | | | | | 55,175 | | | | | | — | | | | | | 800,000 | | | | | | 1.5 | | |
| | Death | | | | | — | | | | | | — | | | | | | 196,474 | | | | | | 500,000 | | | | | | — | | | | | | — | | |
| | Disability | | | | | — | | | | | | 15,968 | | | | | | 196,474 | | | | | | 250,000 | | | | | | — | | | | | | — | | |
| | Change in Control | | | | | 1,600,000 | | | | | | 15,968 | | | | | | 266,444 | | | | | | — | | | | | | 800,000 | | | | | | 2 | | |
| | | | | | | | | | | | | | | | | | |
Name | | Termination
Trigger | | Cash
Separation
Payment ($)(1) | | Health and
Welfare
Benefits ($)(2) | | Value of
Previously
Unvested
Equity
Awards(3) | | Value of
Insurance
Benefit ($)(4) | | 280G
Gross-Up
($)(5) | |
|---|
Christopher D. Pappas | | Termination for Cause | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | |
| | Termination Without Cause | | $ | 5,250,000 | | $ | — | | $ | 5,340,664 | | $ | — | | $ | — | |
| | Death | | $ | — | | $ | — | | $ | 7,698,635 | | $ | 500,000 | | $ | — | |
| | Disability | | $ | — | | $ | — | | $ | 7,698,635 | | $ | 250,000 | | $ | — | |
| | Change in Control | | $ | 5,250,000 | | $ | — | | $ | 12,214,529 | | $ | — | | $ | 6,468,344 | (6) |
Martin Pugh | | Termination for Cause | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | |
| | Termination Without Cause | | $ | 1,475,610 | | $ | — | | $ | 1,001,636 | | $ | — | | $ | — | |
| | Death | | $ | — | | $ | — | | $ | 1,503,185 | | $ | 500,000 | | $ | — | |
| | Disability | | | salary up
to 12
months as
required
by
applicable
law | | $ | — | | $ | 1,503,185 | | $ | 250,000 | | $ | — | |
| | Change in Control | | $ | 1,475,610 | | $ | — | | $ | 2,722,219 | | $ | — | | $ | — | |
Marilyn N. Horner | | Termination for Cause | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | |
| | Termination Without Cause | | $ | 1,008,000 | | $ | — | | $ | 745,105 | | $ | — | | $ | — | |
| | Death | | $ | — | | $ | — | | $ | 1,051,623 | | $ | 500,000 | | $ | — | |
| | Disability | | $ | — | | $ | — | | $ | 1,051,623 | | $ | 250,000 | | $ | — | |
| | Change in Control | | $ | 1,008,000 | | $ | — | | $ | 2,180,544 | | $ | — | | $ | — | |
Angelo N. Chaclas | | Termination for Cause | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | |
| | Termination Without Cause | | $ | 848,625 | | $ | 21,654 | | $ | 316,951 | | $ | — | | $ | — | |
| | Death | | $ | — | | $ | — | | $ | 521,861 | | $ | 500,000 | | $ | — | |
| | Disability | | $ | — | | $ | — | | $ | 521,861 | | $ | 250,000 | | | — | |
| | Change in Control | | $ | 848,625 | | $ | 21,654 | | $ | 521,861 | | $ | — | | $ | — | |
Cash separation payments are generally payable in installments except for payments upon a change in control, which are generally payable in a lump sum.
(2)
Mr. Pappas and Ms. Horner did not participate in our health and welfare benefit plans as of December 31, 2015. Mr. PughLanning receives government sponsored health and welfare benefits, and therefore, does not participate in the Company'sCompany’s health and welfare benefit plans.
(3)
Represents the value associated with equity awards issued under our 2014 Omnibus IncentiveEquity Plan, and equity awards in our Parent, described in "—Narrative“Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table" above. Historical time-based restricted share awards inTable” above and dividend equivalents paid, as applicable on these awards. Under our Parent will vest in full or in part on certain specified terminations of employment, including on a change in control. Change in control compensation amounts also include the value associated with the modified time-based restricted share awards in our Parent that will vest in connection with a change in control. Amounts related to equity awards of our Parent have been calculated based on the fair value of our Parent shares as of December 31, 2015 of $116.60 per share, as calculated by an independent valuation expert. Equity awards under our 2014 Omnibus Incentive Plan, RSUs and options vest in full upon death, disability, or a change in control, and vest in part in certain circumstances when termination is without cause. PSUs vest in full upon a change in control, and vest in part upon death or disability. The
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value of the equity awards granted under our 2014 Omnibus IncentiveEquity Plan was calculated using the Company'sCompany’s closing stock price on December 31, 20152022 of $28.20.
- $22.71. While the number of PSUs that vest can range from 0 to 200% of the original grant, the information in the table above was calculated presuming performance was at target, and therefore 100% of the original grant.
(4)
Represents the maximum value of insurance payable on death due to accident or dismemberment or in the event of permanent disability. The insurance death benefit would only be $250,000, where the executive'sexecutive’s death was due to a cause other than accident or dismemberment.
Employees in Switzerland are not covered under the employee life insurance policy and only receive applicable social system death benefits.
(5)
Represents NEO’s base salary plus target ACI Plan payout amount.
PAY VERSUS PERFORMANCE
2023 Proxy Statement 50
Pay Versus Performance Table
Pay Versus Performance Table
| | Year | | | Summary
Compensation
Table Total
for Principal
Executive
Officer (PEO)
($) (1) | | | Compensation
Actually Paid
to PEO
($) (3) | | | Average
Summary
Compensation
Table Total
for Non-PEO
Named
Executive
Officers
($) (2) | | | Average
Compensation
Actually Paid
to Non-PEO
Named
Executive
Officers
($) (3) | | | Value of Initial Fixed
$100 Investment
Based On: | | | Net (loss)
income
($ in millions) | | | Adjusted
EBITDA
(non-GAAP)
($ in millions) (5) | |
| | Total
Shareholder
Return | | | Peer Group
Total
Shareholder
Return (4) | |
| | 2022 | | | | | 5,793,583 | | | | | | (1,961,363) | | | | | | 1,561,047 | | | | | | 305,441 | | | | | $ | 44 | | | | | $ | 100 | | | | | | (428.0) | | | | | | 312.0 | | |
| | 2021 | | | | | 7,001,892 | | | | | | 6,409,637 | | | | | | 1,747,866 | | | | | | 1,868,496 | | | | | $ | 103 | | | | | $ | 113 | | | | | | 92.0 | | | | | | 729.4 | | |
| | 2020 | | | | | 5,035,919 | | | | | | 11,989,919 | | | | | | 1,524,437 | | | | | | 1,670,250 | | | | | $ | 138 | | | | | $ | 120 | | | | | | 7.9 | | | | | | 285.1 | | |
(1)
Mr. Pappas would be subjectBozich served as the Company’s PEO (President and CEO) for each year presented.
(2)
The Company’s Non-PEO NEOs were: (i) in 2022, Mr. Stasse, Mr. Chaclas, Mr. Lanning and Ms. Cooney (ii) in 2021, Mr. Stasse, Mr. Chaclas, Mr. Lanning and Francesca Reverberi, and (iii) in 2020, Mr. Stasse, Mr. Chaclas, Mr. Lanning and Alice Heezen, and Timothy Stedman (former NEO).
(3)
The following table provides additional information as to the so-called golden parachute taxamounts deducted from and entitledadded to an excise tax gross-upSummary Compensation Table (“SCT”) total compensation for the applicable year pursuant to Item 402(v) of Regulation S-K to determine “compensation actually paid” to the PEO and Non-PEO NEOs:
| | PEO (a) | | | 2022 | | | 2021 | | | 2020 | |
| | Summary Compensation Table – Total Compensation | | | | $ | 5,793,583 | | | | | $ | 7,001,892 | | | | | $ | 5,035,919 | | |
| | Subtract fair value of stock awards and options awards granted in fiscal year | | | | $ | (3,959,041) | | | | | $ | (3,587,469) | | | | | $ | (2,762,319) | | |
| | Add fair value of current-year equity awards outstanding and unvested as
of year-end | | | | $ | 1,141,272 | | | | | $ | 2,944,350 | | | | | $ | 7,738,325 | | |
| | Add fair value of current-year equity awards that vested during the fiscal
year | | | | $ | 0 | | | | | $ | 0 | | | | | $ | 0 | | |
| | Add/subtract change in fair value of prior-year equity awards | | | | $ | (5,226,633) | | | | | $ | (635,819) | | | | | $ | 2,061,466 | | |
| | Add/subtract change in fair value as of vesting date of prior-year equity
awards vested during fiscal year | | | | $ | 473,289 | | | | | $ | 686,682 | | | | | $ | (83,472) | | |
| | Subtract fair value of prior-year awards forfeited during fiscal year | | | | $ | (183,833) | | | | | $ | 0 | | | | | $ | 0 | | |
| | Compensation Actually Paid | | | | $ | (1,961,363) | | | | | $ | 6,409,637 | | | | | $ | 11,989,919 | | |
| | Average Non-PEO Named Executive Officers (a) | | | 2022 | | | 2021 | | | 2020 | |
| | Summary Compensation Table – Average Total Compensation | | | | | 1,561,047 | | | | | | 1,747,866 | | | | | | 1,524,437 | | |
| | Subtract fair value of stock awards and options awards granted in fiscal year | | | | $ | (777,406) | | | | | $ | (600,379) | | | | | $ | (554,922) | | |
| | Add fair value of current-year equity awards outstanding and unvested as of
year-end | | | | $ | 224,104 | | | | | $ | 492,497 | | | | | $ | 1,111,350 | | |
| | Add fair value of current-year equity awards that vested during the fiscal year | | | | $ | 0 | | | | | $ | 0 | | | | | $ | 0 | | |
| | Add/subtract change in fair value of prior-year equity awards | | | | $ | (754,874) | | | | | $ | 13,556 | | | | | $ | 164,755 | | |
| | Add/subtract change in fair value as of vesting date of prior-year equity awards vested during fiscal year | | | | $ | 25,904 | | | | | $ | 123,014 | | | | | $ | (22,736) | | |
| | Subtract fair value of prior-year awards forfeited during fiscal year | | | | $ | (5,841) | | | | | $ | (24,085) | | | | | $ | 0 | | |
| | Subtract change in present value of accumulated benefit under all defined benefit and actuarial pension plans | | | | $ | (124,783) | | | | | $ | (44,879) | | | | | $ | (924,273) | | |
| | Add pension value attributable to current year and change in pension value
attributable to plan amendments made in the current year | | | | $ | 157,290 | | | | | $ | 160,906 | | | | | $ | 371,637 | | |
| | Compensation Actually Paid | | | | $ | 305,441 | | | | | $ | 1,868,496 | | | | | $ | 1,670,250 | | |
51 2023 Proxy Statement
Pay Versus Performance Table
(a)
The fair value of equity awards were calculated using valuation assumptions that materially differ from those disclosed at the time of grant, including: (1) the fair value of RSU awards was calculated using the closing price of our common stock as of the last day of the applicable year or on the date of vesting, as applicable; (2) the fair value of PSU awards was estimated using the Monte Carlo Simulation method (which reflects for each particular award and valuation date adjustments for: actual performance, expected volatility, risk-free interest rate, correlation coefficient, and accrued dividends); and (3) the fair value of options was estimated using the Black-Scholes option-pricing model (which reflects, for each particular award and valuation date, adjustments for expected volatility, risk-free interest rate, dividend yield, expected term (calculated using the simplified method) and stock price).
(4)
The Company’s peer group is the S&P 500 Chemicals Industry GICS Level 3 Index. This index is the published line-of-business index utilized in the amount set forth above assuming a change of control and his accompanying termination of employment occurredCompany’s Annual Report on December 31, 2015. The amount above assumes that (a) all outstanding incentive shares of the Parent are cashed out in connection with the applicable event and valued using a price per Parent share equal to $116.60, (b) Company equity award granted within one year of the change in control transaction were presumed to be in contemplation of the transaction, (c) all outstanding equity awards under our 2014 Omnibus Incentive Plan are cashed out in connection with the applicable event and valued using a price per share of $28.20; and (d) a marginal tax rate of 54% is applied.
(6)The figure set forth above is calculated by including amounts that are not taxable as compensation for federal tax purposes and, accordingly, may not be subject to the excise tax imposed under Section 4999 of the U.S. Tax Code. As a result, the amount disclosed above may overstate the amount of any required gross up.
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PROPOSAL 5
APPROVAL OF THE COMPANY'S LUXEMBOURG STATUTORY ACCOUNTS
Pursuant to Luxembourg law, the Luxembourg Statutory Accounts must be submitted each year to shareholders for approval at the annual general meeting of shareholders.
The Luxembourg Annual Accounts are prepared in accordance with Luxembourg GAAP and consist of a balance sheet, a profit and loss account and the notes for Trinseo. There is no statement of movements in equity or statement of cash flows included in the Luxembourg Annual Accounts under Luxembourg GAAP. Profits earned by the subsidiaries of Trinseo are not included in the Luxembourg Annual Accounts unless such amounts are distributed to Trinseo. The Luxembourg Annual Accounts as of andForm 10-K for the year ended December 31, 2015, show total assets2022.
(5)
Adjusted EBITDA is our primary non-GAAP financial measure. See “Use of $482.8 millionNon-GAAP Measures” below for a definition of Adjusted EBITDA, an explanation of why we believe this measure is useful to investors and the limitations of this measure.
Most Important Financial Measures
Below is an unranked list of the most important financial measures the Company used during 2022 to link Company performance to executive compensation actually paid.
| | | Adjusted EBITDA* | | |
| | | Free Cash Flow* | | |
| | | Capital Expenditures | | |
| | | Total Shareholder Return | | |
*
See “Use of Non-GAAP Measures” below for a lossreconciliation of Adjusted EBITDA and Free Cash Flow, which are non-GAAP measures, to Net Income (Loss) and Cash provided by operating activities.
Relationship between Pay and Performance Graphs
Below are graphs showing the relationship of “compensation actually paid” (CAP) to our Chief Executive Officer and other named executive officers in 2020, 2021 and 2022 to (1) Trinseo’s Adjusted EBITDA*, (2) Trinseo’s net income, and (3) Cumulative TSR of Trinseo and the S&P 500 Chemicals Industry GICS Level 3 Index. The charts reflect that the CAP over the three-year period ended December 31, 2022 aligns to our results over the same period. In 2022, negative CAP for the year then endedCEO and other NEOs reflected a zero payout under the financial performance metric of $15.9 million. The Consolidated Accountsour ACI Plan. In 2021, CAP for our CEO and other NEOs was primarily impacted by Trinseo’s outperformance of its financial metrics under its ACI Plan.
2023 Proxy Statement 52
Pay Versus Performance Table
Use of Non-GAAP Measures
We present Adjusted EBITDA as an important non-GAAP financial performance measure, which we define as income from continuing operations before interest expense, net; income tax provision; depreciation and amortization expense; loss on extinguishment of long-term debt; asset impairment charges; gains or losses on the dispositions of businesses and assets; restructuring charges;
53 2023 Proxy Statement
Pay Versus Performance Table
acquisition related costs and benefits, and other items. In doing so, we are preparedproviding management, investors, and credit rating agencies with an indicator of our ongoing performance and business trends, removing the impact of transactions and events that we would not consider a part of our core operations.
There are limitations to using the financial performance measures noted above. These performance measures are not intended to represent net income or other measures of financial performance. As such, they should not be used as alternatives to net income as indicators of operating performance. Other companies in our industry may define these performance measures differently than we do. As a result, it may be difficult to use these or similarly-named financial measures that other companies may use, to compare the performance of those companies to our performance. We compensate for these limitations by providing reconciliations of these performance measures to our net income, which is determined in accordance with U.S. GAAP,GAAP.
| | | | | December 31, | | | | |
| | (In millions, except per share data) | | | 2022 | | | 2021 | | | 2020 | | | | |
| | Net income (loss) | | | | $ | (430.9) | | | | | $ | 440.0 | | | | | $ | 7.9 | | | | | |
| | Net income (loss) from discontinued operations | | | | | (2.9) | | | | | | 160.4 | | | | | | — | | | | | |
| | Net income (loss) from continuing operations | | | | $ | (428.0) | | | | | $ | 279.6 | | | | | $ | — | | | | | |
| | Interest expense, net | | | | | 112.9 | | | | | | 79.4 | | | | | | 43.6 | | | | | |
| | Provision for (benefit from) income taxes | | | | | (41.6) | | | | | | 70.9 | | | | | | 37.8 | | | | | |
| | Depreciation and amortization | | | | | 236.9 | | | | | | 167.5 | | | | | | 134.3 | | | | | |
| | EBITDA | | | | $ | (119.8) | | | | | $ | 597.4 | | | | | $ | 223.6 | | | | | |
| | Net gain on disposition of businesses and assets | | | | | (1.8) | | | | | | (0.6) | | | | | | (0.4) | | | | Selling, general, and administrative expenses; Other expense, net | |
| | Restructuring and other charges (a) | | | | | 15.9 | | | | | | 9.0 | | | | | | 9.9 | | | | Selling, general, and administrative expenses | |
| | Acquisition transaction and integration net costs (b) | | | | | 6.6 | | | | | | 75.3 | | | | | | 9.1 | | | | Cost of goods sold; Selling, general, and administrative expenses | |
| | Acquisition purchase price hedge (gain) loss (c) | | | | | — | | | | | | 22.0 | | | | | | (7.3) | | | | Acquisition purchase price hedge (gain) loss; Other expense (income), net | |
| | Asset impairment charges or write-offs (d) | | | | | 6.3 | | | | | | 6.8 | | | | | | 39.1 | | | | Impairment and other charges | |
| | European Commission request for information (e) | | | | | 36.2 | | | | | | — | | | | | | — | | | | Impairment and other charges | |
| | Goodwill impairment charge (f) | | | | | 297.1 | | | | | | — | | | | | | — | | | | Impairment and other charges | |
| | Other items (g) | | | | | 71.2 | | | | | | 19.5 | | | | | | 25.5 | | | | Selling, general, and administrative expenses; Other expense, net | |
| | Adjusted EBITDA | | | | $ | 311.7 | | | | | $ | 729.4 | | | | | $ | 299.5 | | | | | |
(a)
Restructuring and other charges for 2022 primarily relate to employee termination benefit charges as well as decommissioning and other charges incurred in connection with the Company’s asset restructuring plan. Restructuring and other charges for 2021 primarily relate to employee termination benefit charges as well as contract termination charges incurred in connection with the Company’s transformational and corporate restructuring programs. Restructuring and other charges for 2020 primarily relate to charges incurred in connection with the Company’s corporate and other restructuring programs. Additionally, a portion of the restructuring and other charges for the 2020 period relate to decommissioning, contract termination, and employee termination benefit charges incurred in connection with the upgrade and replacement of our compounding facility in Terneuzen, The Netherlands as well as our decision to cease manufacturing activities at our latex binders manufacturing facility in Livorno, Italy. Note that the accelerated depreciation charges incurred as part of both the Company’s corporate restructuring program and the upgrade and replacement of the Company’s compounding facility in Terneuzen, The Netherlands are included within the “Depreciation and amortization” caption above, and therefore are not included as a separate adjustment within this caption. Acquisition transaction and integration net costs for 2020 presented above primarily relate to expenses incurred for the Company’s pending acquisition of the PMMA business from Arkema.
(b)
Acquisition transaction and integration net costs for 2022 and 2021 primarily relate to expenses incurred for the Company’s acquisition and integration of the PMMA business and Aristech Surfaces Acquisitions. The acquisition purchase price hedge gain for 2020 relates to the change in fair value of the Company’s forward currency hedge arrangement that economically hedged the euro-denominated purchase price of the proposed acquisition of Arkema’s PMMA business.
(c)
Acquisition purchase price hedge loss for 2021 relates to the change in fair value of the Company’s forward currency hedge arrangement that economically hedges the euro-denominated purchase price of the acquisition of the Arkema PMMA business. Asset impairment charges or write-offs for 2020 relate to the impairment of the Company’s styrene monomer assets in Boehlen, Germany and polybutadiene rubber (nickel and neodymium-PBR) assets in Schkopau, Germany.
(d)
Asset impairment charges for 2022 and 2021 primarily relate to the impairment of the Company’s styrene monomer assets in
2023 Proxy Statement 54
Pay Versus Performance Table
Boehlen, Germany. Asset impairment charges or write-offs for 2020 relate to the impairment of the Company’s styrene monomer assets in Boehlen, Germany and polybutadiene rubber (nickel and neodymium-PBR) assets in Schkopau, Germany.
(e)
Amounts for 2022 relate to the liability recorded in connection with the European Commission request for information, adjusted for foreign exchange rate impacts, which was subsequently paid in full in December 2022.
(f)
Amounts for 2022 relate to the PMMA business and Aristech Surfaces reporting units’ goodwill impairment charge resulting from annual impairment testing.
(g)
Other items for the 2022 and 2021 periods primarily relate to fees incurred in conjunction with certain of the Company’s strategic initiatives, as well as costs related to our transition to a new enterprise resource planning system. Other items for 2020 primarily relate to advisory and professional fees incurred in conjunction with our initiative to transition business services from Dow, including a footnote reconciliationcertain administrative services such as accounts payable, logistics, and IT services, which was substantially completed in 2020, as well as fees incurred in conjunction with certain of equitythe Company’s strategic initiatives.
The Company also uses Free Cash Flow as an important non-GAAP financial measures, to evaluate and net income (loss)discuss its liquidity position and results. Free Cash Flow is defined as cash from operating activities, less capital expenditures. We believe that Free Cash Flow provides an indicator of the Company’s ongoing ability to IFRS, and consistgenerate cash through core operations, as it excludes the cash impacts of a balance sheet, statement of operations, statement of changes in shareholders' equity, statement ofvarious financing transactions as well as cash flows from business combinations that are not considered organic in nature. We also believe that Free Cash Flow provides management and investors with useful analytical indicators of our ability to service our indebtedness, pay dividends (when declared), and meet our ongoing cash obligations.
Free Cash Flow is not intended to represent cash flows from operations as defined by GAAP, and therefore, should not be used as alternatives for that measure. Other companies in our industry may define Free Cash Flow differently than we do. As a result, it may be difficult to use this or similarly-named financial measures that other companies may use, to compare the accompanying notes.liquidity and cash generation of those companies to our own. The Consolidated Accounts presentCompany compensates for these limitations by providing the financial position and resultsfollowing detail, which is determined in accordance with GAAP.
Free Cash Flow
| | | | | Year Ended December 31, | |
| | (In millions) | | | 2022 | | | 2021 | | | 2020 | |
| | Cash provided by operating activities | | | | $ | 43.5 | | | | | $ | 452.7 | | | | | $ | 255.4 | | |
| | Capital expenditures | | | | | (149.0) | | | | | | (123.5) | | | | | | (82.3) | | |
| | Free Cash Flow | | | | $ | (105.5) | | | | | $ | 329.2 | | | | | $ | 173.1 | | |
55 2023 Proxy Statement
CEO PAY RATIO
In 2022 the Company updated its comparison of operations for Trinseo and allCEO pay to the pay of its subsidiaries as if the individual entities were a single company.employees, consistent with SEC rules. As of December 31, 2015,2022, the Consolidated Accounts show IFRSCompany determined that the total equitynumber of $381.0 millionemployees was 3,424. When identifying the median employee in 2022, the Company chose target total cash compensation as the consistently applied compensation measure. To make this calculation, the Company annualized pay for those employees who commenced work during 2022, through recruitment and IFRS net incomeacquisition, and any employee who was on unpaid leave for a portion of $133.5 million for the year then ended. Pursuant2022. The Company used a statistically valid sampling methodology to Luxembourg law, following shareholder approvalidentify a population of employees whose target total cash compensation was within a 2% range of the Luxembourg Statutory Accounts,median. From this sample, the Company identified the median employee.
Total compensation for 2022 for our CEO was $5,793,583, and the median employee’s total compensation was $68,232. Therefore, as further described in the table below, the Company’s 2022 ratio of CEO pay to median worker pay is 85:1.
| | Compensation Element | | | CEO
($) | | | Median
Employee
($) | |
| | Annual Salary | | | | | 1,050,000 | | | | | | 59,542 | | |
| | Bonus | | | | | 1,373 | | | | | | | | |
| | Fair Value of Stock Awards | | | | | 2,761,179 | | | | | | | | |
| | Fair Value of Option Awards | | | | | 1,197,862 | | | | | | | | |
| | Non-equity Incentive Plan Compensation | | | | | 650,000 | | | | | | 1,779 | | |
| | Change in Pension Value | | | | | 2,041 | | | | | | | | |
| | All Other Compensation | | | | | 132,501 | | | | | | 5,537 | | |
| | Summary Compensation Table Totals | | | | | 5,793,583 | | | | | | 68,232 | | |
| | 2022 CEO Pay Ratio | | | 85:1 | |
SEC rules for identifying the median employee allow companies to adopt a variety of methodologies, and to use reasonable estimates and assumptions that reflect their compensation practices. As such, accountspay ratios reported by other companies may not be comparable to the Company’s pay ratio reported above.
2023 Proxy Statement 56
Director Compensation
For each of our non-employee directors, our 2022 director compensation program consisted of an annual cash retainer payment of $90,000, and an annual equity retainer of restricted stock units with a grant date fair value of $130,000, which vest on the one-year anniversary of their grant date. Additionally, the Board’s non-employee chair received an additional annual cash retainer of $130,000. The non-employee chairs of the audit committee, compensation committee, nominating and corporate governance committee and EHSS&PP committee received additional annual cash retainers of $25,000, $20,000, $15,000 and $15,000, respectively.
Due to the Company’s redomiciliation into Ireland in 2021, our directors were required to file an income tax return in Ireland to claim a refund for overpayment of taxes. In 2022, each director was given a one-time additional compensation of $5,495 to pay fees and VAT related to preparation of their Irish income tax returns. All directors except Mr. Tomkins utilized this service.
Our directors are subject to the Company’s share ownership guidelines, which stipulate that each director must be filedhold five (5) times their annual cash retainer in Trinseo shares within five (5) years from the date of becoming a Board member. As of December 31, 2022, all of our directors were in compliance with the Luxembourg trade registry as public documents. If Trinseo doesstock ownership guidelines, with the exception of Messrs. Alvarado, De Leener and Martens, and Ms. Johnson. Mr. Alvarado, Mr. De Leener, and Ms. Johnson’s failure to meet the guidelines was due to a decline in stock price, and under our stock ownership guidelines, failure due to decline in stock price is not receive shareholder approvaldeemed a breach if the director met the guidelines in the prior year. Until the ownership requirement is met, directors who are not in compliance must retain 50% of the Luxembourg Statutory Accounts, we cannot make this filing. Trinseo's Luxembourg Statutory Accounts will be available to shareholders from April 14, 2015 untilshares issued after vesting and settlement of restricted stock units (net of all applicable taxes).
The following table sets forth information concerning the conclusioncompensation earned by our directors during fiscal 2022.
| | | | | Fees Earned or
Paid in Cash
($) (1) | | | Stock Awards
($) (2) (3) | | | All Other
Compensation
($) (4) | | | Total
($) | |
| | Joseph Alvarado | | | | | 117,500 | | | | | | 130,000 | | | | | | 5,495 | | | | | | 252,995 | | |
| | Victoria Brifo | | | | | 90,000 | | | | | | 130,000 | | | | | | 5,495 | | | | | | 225,495 | | |
| | Jeffrey J. Cote | | | | | 90,000 | | | | | | 130,000 | | | | | | 5,495 | | | | | | 225,495 | | |
| | Pierre-Marie De Leener | | | | | 90,000 | | | | | | 130,000 | | | | | | 5,495 | | | | | | 225,495 | | |
| | Jeanmarie Desmond | | | | | 90,000 | | | | | | 130,000 | | | | | | 5,495 | | | | | | 225,495 | | |
| | Matthew Farrell | | | | | 90,000 | | | | | | 130,000 | | | | | | 5,495 | | | | | | 225,495 | | |
| | K’Lynne Johnson | | | | | 220,000 | | | | | | 130,000 | | | | | | 5,495 | | | | | | 355,495 | | |
| | Sandra Beach Lin | | | | | 105,000 | | | | | | 130,000 | | | | | | 5,495 | | | | | | 240,495 | | |
| | Philip R. Martens | | | | | 105,000 | | | | | | 130,000 | | | | | | 5,495 | | | | | | 240,495 | | |
| | Donald T. Misheff | | | | | 90,000 | | | | | | 130,000 | | | | | | 5,495 | | | | | | 225,495 | | |
| | Henri Steinmetz | | | | | 90,000 | | | | | | 130,000 | | | | | | 5,495 | | | | | | 225,495 | | |
| | Mark Tomkins | | | | | 115,000 | | | | | | 130,000 | | | | | | | | | | | | 245,000 | | |
(1)
Consists of the General Meeting at Trinseo's registered office.YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL 5, APPROVAL OF THE LUXEMBOURG STATUTORY ACCOUNTS.
Table of Contents
PROPOSAL 6
RESOLUTION ON THE ALLOCATION OF THE RESULTS OF THE
FINANCIAL YEAR ENDED DECEMBER 31, 2015
Pursuant to Luxembourg law, the shareholders must decide how to allocate the results of the previous financial yearannual retainer amounts, which are paid quarterly and prorated based on the Luxembourgdate of appointment as a director, or as committee or board chair. Mr. Alvarado’s retainer for serving as chair of the Compensation Committee was mistakenly not fully paid in 2021, and $7,500 of the 2021 retainer was paid to him in March 2022.
(2)
The amounts reported represent the grant date fair value of restricted stock units granted in 2022 calculated in accordance with ASC 718. The assumptions used for determining fair value are described in Note 17 to our consolidated financial statements filed with our Annual Accounts.Report on Form 10-K.
(3)
As of December 31, 2022, each of our non-employee directors held 3,183 shares pursuant to unvested restricted stock unit awards which vest in June 2023.
(4)
The
Luxembourg Annual Accounts showamount for all directors except Mr. Tomkins reflects one-time additional compensation of $5,495 to pay fees related to preparation of Irish income tax returns, including VAT (converted to USD using a
loss for the year then ended of $15.9 million. The Board recommends to carry forward the loss to the following year.YOUR BOARD1.0511 USD:1 EUR rate).
57 2023 Proxy Statement
Audit Committee Matters
We operate in accordance with a written charter adopted by the Board and reviewed annually by the audit committee, a copy of which is available on our website,www.investor.trinseo.cominvestor.trinseo.com, under the "Corporate Governance—“Governance—Committee Composition"Composition” section. We are responsible for overseeing the quality and integrity of Trinseo'sTrinseo’s accounting, auditing and financial reporting practices. In accordance with the rules of the SEC and the NYSE, the audit committee is composed entirely of members who are independent, as defined by the listing standards of the NYSE. Further, the Board has determined that twofive of ourits members, (Mr.Ms. Desmond and Messrs. Cote, Farrell, Misheff and Mr. Misheff)Tomkins, are each audit committee financial experts as defined by the rules of the SEC. The audit committee met 8nine times during fiscal 20152022 with Trinseo'sTrinseo’s management and PricewaterhouseCoopers LLP ("PwC"(“PwC”), Trinseo'sTrinseo’s independent registered public accounting firm, including, but not limited to, meetings held to review and discuss the annual audited and quarterly financial statements and the Company'sCompany’s earnings press releases. We believe that we fully discharged our oversight responsibilities as described in our audit charter, including with respect to the audit process. We received the written disclosures and the letter from PwC pursuant to Rule 3526, Communication with Audit Committees Concerning Independence, of the Public Company Accounting Oversight Board ("PCAOB"(“PCAOB”) concerning any relationships between PwC and Trinseo and the potential effects of any disclosed relationships on PwC'sPwC’s independence and discussed with PwC its independence. We discussed with management, the internal auditors and PwC, Trinseo'sTrinseo’s matters including internal control over financial reporting and the internal audit function'sfunction’s organization, responsibilities, budget and staffing. We reviewed with both PwC and our internal auditors their audit plans, audit scope, identification of audit risks and the results of their audit efforts. We discussed and reviewed with PwC their communicationsthe matters required to be discussed by Auditing Standard No. 1301, “Communications with Audit Committees,” as adopted by the Standards of the PCAOB (United States), as described in PCAOB AU Section 380, "Communication with Audit Committees," and, with and without management present, discussed and reviewed the results of PwC'sPwC’s examination of Trinseo'sTrinseo’s financial statements. We also discussed the results of the internal audit examinations with and without management present. The following table shows the fees for professional services rendered by PricewaterhouseCoopers LLP ("PwC")PwC for the year ended December 31, 20152022 (fiscal 2015)2022) and the year ended December 31, 20142021 (fiscal 2014)2021):
| | | | | 2022 | | | 2021 | |
| | Audit fees (1) | | | | $ | 7,260,000 | | | | | $ | 8,145,000 | | |
| | Audit-related fees (2) | | | | $ | 7,143,000 | | | | | $ | 913,000 | | |
| | Tax fees (3) | | | | $ | 191,000 | | | | | $ | 48,000 | | |
| | All other fees (4) | | | | $ | 10,000 | | | | | $ | 5,000 | | |
| | Total fees | | | | $ | 14,604,000 | | | | | $ | 9,111,000 | | |
| | | | | | | |
| | 2015 | | 2014 | |
|---|
Audit fees(1) | | $ | 5,965,200 | | $ | 4,599,763 | |
Audit-related fees(2) | | | 185,000 | | | 265,000 | |
Tax fees(3) | | | 2,792,700 | | | 3,885,000 | |
All other fees(4) | | | 161,500 | | | 226,500 | |
| | | | | | | | |
Total fees | | $ | 9,104,400 | | $ | 8,976,263 | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
Consists of the audit of the Company'sCompany’s financial statements and evaluation and reporting on the effectiveness of the Company'sCompany’s internal controls over financial reporting, for 2015, the audit of the Company's financial statements for 2014,statutory audits, reviews of the Company'sCompany’s quarterly financial statements, as well as services performed in conjunction with other SEC and regulatory filings. For fiscal 2021, these fees included issuance of a comfort letter in connection with the Company’s 2021 debt offering, as well as audit services related to the acquisition of Altuglas and statutory filings.Aristech entities, and the sale of the synthetic rubber business. These fees include $144,882$$292,000 and $339,326$297,000 paid by Trinseo to PricewaterhouseCoopers Société cooperative ("PwC Luxembourg") for services rendered for the audit of all statutory accounts
Table required by Irish law during fiscal 2022 and fiscal 2021, respectively. These fees also include $87,395 paid to PricewaterhouseCoopers Société cooperative for the audit of Contents
all statutory accounts required by Luxembourg law during fiscal 2015 and 2014, respectively. PwC Luxembourg did not provide any non-audit services during those fiscal years.
- 2021.
(2)Consists
Primarily consists of services related to the audit of our Company savings plan, as well asstrategic initiatives, pre-implementation reviews of processes and systems.
systems, financial due diligence, pension plan audits, and various other agreed upon procedures. The increase in fiscal 2022 audit-related fees is mainly due to carve out audit services related to the proposed sale of the styrenics business.
(3)
Consists of tax compliance, tax audit defense, as well as worldwide tax services primarily related to tax complianceadvisory and certain tax advisoryconsulting services.
(4)
Consists of other services, including certain attestation services and statutory accounting advice.subscriptions to knowledge tools.
We pre-approve all audit services and all permitted non-audit services by PwC, including engagement fees and terms. Our policies prohibit the Company from engaging PwC to provide any services relating to bookkeeping or other services related to accounting records or financial statements, financial information system design and implementation, appraisal or valuation services, fairness opinions or contribution-in-kind reports, actuarial services, internal audit outsourcing, any management function, legal services or expert services not related to the audit, broker-dealer, investment adviser, or investment banking services or human resource consulting.
2023 Proxy Statement 58
In addition, we evaluate whether the Company'sCompany’s use of PwC for permitted non-audit services is compatible with maintaining PwC'sPwC’s independence. We concluded that PwC'sPwC’s provision of non-audit services, all of which we approved in advance, was compatible with its independence. We reviewed the audited consolidated financial statements of Trinseo as of December 31, 2015 and for fiscal 20152022 with management and PwC. Management has the responsibility for the preparation of Trinseo'sTrinseo’s financial statements, and PwC has the responsibility for the audit of those statements. Based on these reviews and discussions with management and PwC, we recommended to the Board that Trinseo'sTrinseo’s audited financial statements be included in its Annual Report on Form 10-K for fiscal 20152022 for filing with the SEC. We have reviewed and evaluated the performance of PwC, and as a result have selected PwC as the independent registered public accounting firm for fiscal 2016,the year ended December 31, 2023, subject to ratification by Trinseo'sTrinseo’s shareholders, and our authority to set auditor remuneration will be subject to approval by Trinseo’s shareholders. We have also reviewedevaluated and evaluated the performance of PwC Luxembourg, and as a result have selected PwC LuxembourgPricewaterhouseCoopers as the independent auditor for all of Trinseo'sTrinseo’s statutory accounts required under LuxembourgIrish law for fiscal 2016, subject to ratification by Trinseo's shareholders.Audit Committee
Jeffrey J. Cote, Chair
Pierre-Marie De Leener
Donald T. Misheff
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PROPOSAL 8
RATIFICATION OF APPOINTMENT OF THE INDEPENDENT AUDITOR
The audit committee of our Board has proposed to appoint PwC Luxembourg to be our independent auditor for the year ended December 31, 2016 for all statutory accounts as required by Luxembourg law2023.
Audit Committee
Mark Tomkins, Chair
Jeffrey J. Cote
Jeanmarie Desmond
Matthew Farrell
Donald T. Misheff
Henri Steinmetz
59 2023 Proxy Statement
Proposal 3—Ratification of Appointment of the Independent Registered Public Accounting Firm and Authorization of the Board to Set Auditors’ Remuneration
The Audit Committee of our Board has retained PwC to be our independent registered public accounting firm for the same period.year ending December 31, 2023. The audit committeeAudit Committee has further recommended that such appointment be submitted for approvalratification by our shareholders at the GeneralAnnual Meeting. We are also asking our shareholders to authorize the audit committee of the Board to determine the remuneration of our independent registered public accounting firm and the Company’s statutory auditor.
Therefore, we are seeking (i) ratification of the appointment of PwC as our independent registered public accounting firm, in a non-binding advisory vote, and (ii) authorization, in a binding vote, of the authority of the audit committee of the Board to determine the remuneration of our independent registered public accounting firm and the Company’s statutory auditor, from our shareholders at the Annual Meeting.
Representatives of PwC Luxembourgalong with representatives of PricewaterhouseCoopers, our Irish statutory auditor, will be presentavailable at the GeneralAnnual Meeting, will be given the opportunity to make a statement, if they so desire, and will be available to respond to appropriate questions from you.YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL 8, RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITOR FOR ITS LUXEMBOURG ACCOUNTS.
PROPOSAL 9
RATIFICATION OF APPOINTMENT
THE TEXT OF THE INDEPENDENT REGISTERED ACCOUNTING FIRM
TheRESOLUTION IN RESPECT OF THIS PROPOSAL IS AS FOLLOWS:
“RESOLVED, that (i) the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for the year ending December 31, 2023 be approved and (ii) the audit committee of our Board has proposedthe board of directors is authorized to appoint PwC to bedetermine the remuneration of our independent registered public accounting firm and the year ended December 31, 2016statutory auditor.”
| | | THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR”
THE APPOINTMENT OF PWC AS ITS INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM,
AND ON A BINDING BASIS, THE AUTHORIZATION OF THE BOARD’S AUDIT COMMITTEE
TO FIX THE AUDITORS’ REMUNERATION. | | |
2023 Proxy Statement 60
Proposal 4—Board Authority to Issue Shares under Irish Law
Under Irish law, directors of an Irish public limited company must have authority from its shareholders to issue any shares, including shares that are part of the Company’s authorized but unissued share capital.
We are presenting this proposal to renew the Board’s authority to issue our authorized but unissued shares, which approval is conditional on shareholder approval of Proposal 5. It has been customary practice in Ireland to seek shareholder authority to issue up to 33% of a company’s issued ordinary share capital, and for Trinseo's consolidated financial statements. The audit committee has further recommended that such appointmentauthority to be submitted forlimited to a period of up to 18 months. However, in line with evolving stakeholder expectations, we are seeking approval by our shareholders at the General Meeting. Representatives of PwC will be present at the2023 Annual General Meeting will be given the opportunity to make a statement, if they so desire, and will be available to respond to appropriate questions from you.
YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL 9, RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM.
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PROPOSAL 10
AUTHORIZATION OF REPAYMENT OF EQUITY
Under Luxembourg law, a repayment of equity (which includes a repayment out of the share premium or similar premiums account) is a decision that must be taken by the shareholders. The Board must, therefore, receive the approval of shareholders prior to authorizing a repayment of equity. We are proposing that our shareholders authorize the Board to approve repaymentsissue up to a maximum of equity out20% of our share premium or similar premiums account in full, in one or several times, and grant to the Board the power to approve repayments out of equity in amounts and in frequencies determined by the Board and at all times in compliance with Luxembourg law.
While the Company believes returning equity to its shareholders to be an appropriate use of its cash, the forgoing authorization, if approved, does not require the Company to make such a repayment or guarantee that it will make such a repayment. Even if the Company undertakes any repayment of equity, it does not guarantee it will continue to make such distributions in the future, or that future distributions will be of the same size. Any future determination to declare or make any such repayment to our shareholders will be at the discretion of our Board, subject to compliance with covenants in current and future agreements governing our indebtedness and applicable Luxembourg law, and will depend upon our results of operations, financial condition, capital requirements and other factors that our Board deems relevant.
Similar to cash dividends, a repayment of equity may result in cash distributions to shareholders. If this proposal is approved, the Board plans to declare an annual repayment of equity of $1.20 per share to be paid to shareholders of record quarterly.
YOUR BOARD OF DIRECTORS RECOMMENDS YOU VOTE FOR PROPOSAL 10, AUTHORIZING THE BOARD TO APPROVE REPAYMENTS OF EQUITY IN AMOUNTS AND AT INTERVALS DETERMINED IN THEIR DISCRETION AND ALL TIMES WITHIN THE LIMITS OF LUXEMBOURG LAW.
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PROPOSAL 11
AUTHORIZATION OF REPURCHASE PROGRAM
At our annual general meeting of shareholders in May 2014, a share repurchase program was approved authorizing the Company to repurchase up to 3,726,956 of itsissued ordinary shares, or 10% of the Company's then outstanding ordinary shares. This authorization was valid for a period of five years. Under that program, ordinary shares are eligible for repurchase at a minimum price of one dollar ($1.00) per share and a maximum price of one thousand dollars ($1,000.00) per share. Under this share repurchase program, we repurchased 1.6 million shares from our Parent as part of a secondary offering of our ordinary shares that was completed on March 24, 2016. In order to treat all of our shareholders equally as required under Luxembourg Law, we commenced a tender offer on March 28, 2016 to repurchase 1,165,000 of our ordinary shares. [Pursuant to this tender offer, we repurchased ordinary shares, and only ordinary shares remain under our current share repurchase authorization.]
Therefore, our Board is proposing a new share repurchase program (the "Share Repurchase Program") to our shareholders for approval, whereby the Board is empowered to repurchase up to 4.5 million of the Company's outstanding ordinary shares, or approximately 9.5% of our outstanding share capital as of March 31, 2016. The2023, for a period expiring 18 months from the passing of this resolution, unless otherwise varied, revoked or renewed. Notwithstanding the foregoing, we expect to propose renewal of this authorization on a regular basis at our annual general meetings in future years.
Granting the Board this authority is a routine matter for public companies incorporated in Ireland and is consistent with Irish market practice. This authority is fundamental to our business and enables us to issue shares, including, if applicable, in connection with funding acquisitions and raising capital. We are not asking you to approve an increase in our authorized share capital or to approve a specific issuance of shares. Instead, approval of this proposal will only grant the Board the authority to issue shares that are already authorized under our Constitution upon the terms below. In addition, we note that, because we are a NYSE-listed company, our shareholders continue to benefit from the protections
afforded to them under the rules and regulations of the Share Repurchase ProgramNYSE and SEC, including those rules that limit our ability to issue shares in specified circumstances.
As required under Irish law, the resolution in respect of this proposal is an ordinary resolution that requires the affirmative vote of a simple majority of the votes cast.
THE TEXT OF THE RESOLUTION IN RESPECT OF THIS PROPOSAL IS AS FOLLOWS:
“RESOLVED, that subject to and conditional on the passing of the resolution in respect of Proposal No. 5, and in substitution for all existing such authorities, the directors be and are hereby generally and unconditionally authorized with effect from the passing of this resolution to exercise all powers of the Company to allot relevant securities (within the meaning of section 1021 of the Companies Act 2014) up to an aggregate nominal amount of $70,282.81 (7,028,281 shares) (being equivalent to approximately 20% of the aggregate nominal value of the issued ordinary share capital of the Company as of March 31, 2023 (the latest practicable date before this proxy statement)), and the authority conferred by this resolution shall expire 18 months from the passing of this resolution, unless previously renewed, varied or revoked; provided that the Company may make an offer or agreement before the expiry of this authority, which would or might require any such securities to be allotted after this authority has expired, and in that case, the directors may allot relevant securities in pursuance of any such offer or agreement as if the authority conferred hereby had not expired.”
| | | THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR”
THE BOARD AUTHORITY TO ISSUE SHARES. | | |
61 2023 Proxy Statement
Proposal 5—Board Authority to Opt Out of Statutory Pre-Emption Rights under Irish Law
Under Irish law, unless otherwise authorized, when an Irish public limited company issues shares for two (2) years. If approved bycash to new shareholders, it is required first to offer those shares on the new Share Repurchase Programsame or more favorable terms to its existing shareholders of the company on a pro-rata basis (commonly referred to as the statutory pre-emption right).
We are presenting this proposal to request shareholder approval of waiver of their statutory pre-emption rights in connection with a share issuance authorized in Proposal 4. We understand that it is customary practice for listed companies in Ireland to seek shareholder authority to waive (or “opt out of”) their statutory pre-emption rights in the event of (i) the issuance of shares for cash in connection with any rights issue; and (ii) the issuance of shares for cash, if the issuance is limited to up to 5% of a company’s issued ordinary share capital (with the possibility of issuing an additional 5% of the company’s issued ordinary share capital provided the company uses it only in connection with an acquisition or specified capital investment which is announced contemporaneously with the issuance, or which has taken place in the preceding six-month period and is disclosed in the announcement of the issue) bringing the total acceptable limit to 10% of the company’s issued ordinary share capital.
It is also customary practice for such waiver (or opt-out) to be limited to a period of 12 to 18 months. Therefore, in accordance with customary practice for listed companies in Ireland, we are seeking this authority for a period expiring 18 months from the passing of this resolution, unless otherwise varied, renewed or revoked.
Similar to the authorization sought for Proposal 4, granting the Board this authority is a routine matter for public companies incorporated in Ireland and is consistent with Irish market practice. This authority is fundamental to our business and, if applicable, will facilitate our ability to fund acquisitions and otherwise raise capital. We are not asking you to approve an increase in our authorized share capital. Instead, approval of this proposal will only grant the Board the authority to issue shares that are already authorized under our Constitution upon the terms below. This proposal is also conditioned on shareholder approval of Proposal 4.
Without any such authorization, in each case when we issue shares for cash, we would replacefirst have to offer those shares on the previoussame or more favorable terms to all of our existing shareholders. This requirement could cause delays in the completion of acquisitions and capital raising for our business. Renewal of this authority would not exempt the Company from applicable NYSE
requirements to obtain shareholder approval prior to certain share repurchase program adopted in 2014,issuances, generally at or greater than 20%.
As required under Irish law, the resolution is a special resolution that requires the affirmative vote of at least 75% of the votes cast.
THE TEXT OF THE RESOLUTION IN RESPECT OF THIS PROPOSAL IS AS FOLLOWS:
“RESOLVED, that, as a special resolution, subject to the completionpassing of the resolution in respect of Proposal No. 4 as set out above, in substitution for all such existing powers, and with effect from the passing of this resolution, the directors be and are hereby empowered pursuant to section 1023 of the Companies Act 2014 to allot equity securities (as defined in section 1023 of that Act) for cash, pursuant to the authority conferred by Proposal No. 4 as if sub-section (1) of section 1022 of that Act did not apply to any such allotment, provided that this power shall be limited to: (a) the allotment of equity securities in connection with a rights issue in favor of the holders of ordinary shares (including rights to subscribe for, or convert into, ordinary shares) where the equity securities respectively attributable to the interests of such holders are proportional (as nearly as may be) to the respective numbers of ordinary shares held by them (but subject to such exclusions or other arrangements as the directors may deem necessary or expedient to deal with fractional entitlements that would otherwise arise, or with legal or practical problems under the laws of, or the requirements of any outstanding offersrecognized regulatory body or any stock exchange in, any territory, or otherwise); and (b) the allotment (otherwise than pursuant to repurchase,sub-paragraph (a) above) of equity securities up to an aggregate nominal value of $35,141 (3,514,140 shares) (being equivalent to approximately 10% of the aggregate nominal value of the issued ordinary share capital of the Company as of March 31, 2023 (the latest practicable date before this Proxy Statement)) provided that, with respect to 1,757,070 of such shares, (being equivalent to approximately 5% of the issued ordinary share capital), such allotment is to be used for the purposes of an acquisition or a specified capital investment; and in each case, the authority conferred by this resolution shall expire eighteen (18) months from the passing of this resolution, unless previously renewed, varied or revoked; provided that the Company may make an offer or agreement before the expiry of this authority, which would or might require any such securities to be allotted after this authority has expired, and in that case, the directors may allot equity securities in pursuance of any such offer or agreement as if the authority conferred hereby had not expired.”
| | | THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR”
THE BOARD AUTHORITY TO OPT OUT OF PREEMPTION RIGHTS. | | |
2023 Proxy Statement 62
Proposal 6—Authorize Price Range for Re-Issuing Treasury Shares
Our treasury account contains ordinary shares that we previously acquired from our shareholders, and when we issue ordinary shares to satisfy our obligations under our equity compensation plan or for other purposes, we may re-issue shares from our treasury account instead of issuing new ordinary shares from our authorized share capital. Under Irish law, we need our shareholders to set the minimum and maximum prices at which we are authorized to re-issue treasury shares off-market. Once set by our shareholders, the price range is valid for no more than 18 months. Unless the price range is set by our shareholders, we cannot re-issue treasury shares. If approved, we intend to use our treasury shares primarily to satisfy obligations under equity awards granted to our employees and directors under our Equity Plan, and it is possible we may also reissue treasury shares for other corporate purposes that may arise.
THE FORMAL TEXT OF THE RESOLUTION THAT WE ARE ASKING OUR SHAREHOLDERS TO APPROVE IS AS FOLLOWS:
“RESOLVED that, as a special resolution for the purposes of section 1078 of the Companies Act 2014 of Ireland (the “Companies Act”), the maximum and minimum prices at which ordinary shares that we previously acquired and hold in treasury may be reissued off-market are as follows:
(i)
the maximum price at which such treasury shares may be re-allotted off-market is an amount equal to 120% of the
market price per ordinary share on the New York Stock Exchange or any other securities exchange where the Company’s shares are then traded, and
(ii)
the minimum price at which such treasury shares may be re-allotted shall be the nominal value of the share where such a share is required to satisfy an obligation under any compensation plan (including any share or option scheme) operated by Trinseo PLC or, in all other cases, not less than 95% of the market price per ordinary share on the New York Stock Exchange or any other securities exchange where the Company’s shares are then traded.
The authority conferred by this resolution is effective from the date of passing of this resolution and expires eighteen months from the date of the passing of this resolution, unless previously varied, revoked or renewed by special resolution in accordance with the provisions of section 1078 of the Companies Act.
For the purpose of this resolution, the “market price” of our ordinary shares is the average of the closing price on each of the consecutive days of trading during a period no shorter than one trading day and no new repurchases would be madelonger than 10 trading days immediately preceding the date of the issuance, as reasonably determined by the Board of the Company.”
As required under Irish law, the resolution is a special resolution that requires the affirmative vote of at least 75% of the votes cast.
| | | THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR”
THE PRICE RANGE FOR ISSUING TREASURY SHARES. | | |
63 2023 Proxy Statement
Proposal 7—Adoption of Amendment to Omnibus Incentive Plan
Background
Our Board is recommending approval of an amendment to the Company’s Amended and Restated 2014 Omnibus Incentive Plan (the “Plan”), solely to increase the maximum number of ordinary shares available for grant to participants under the 2014 authorization.Plan by 1,825,000 shares, to 8,000,000 shares. We have determined that the number of shares remaining under the Plan and the related sub-plan is insufficient to provide equity incentive awards to the Company’s current employees, directors and executive officers for the next year. Challenging operating conditions in 2022, including historically high energy prices, rising interest rates, inflationary pressure, geopolitical uncertainty, and fluctuations in raw material prices led to weaker demand, customer destocking, and our decision to pause the proposed sale of our styrenics business due to deteriorating financing markets. These conditions put significant downward pressure on our share price which resulted in a higher burn rate of shares under our Plan than in previous years.
Why You Should Vote for the Plan Amendment
Employee Retention and Incentives; Alignment with Shareholder Interests. The Share Repurchase Program willincrease to authorized shares sought by this proposed amendment is expected to allow the Company to continue to grant awards to employees through 2024, based on the current market price of our ordinary shares and the number of shares awarded to employees in previous years. The Board believes that these types of awards are essential to align the interests of employees with those of our shareholders, and believes these types of awards are essential in attracting, retaining, and motivating our employees as we continue to execute our strategy and transform our business. The Board is recommending that shareholders approve the proposed amendment so the Company may continue to effectively utilize its long-term equity incentive award program to reward and incentivize its employees. If the proposed amendment to the Plan is not approved, the Company will not have a sufficient number of authorized shares for future awards to be issued under the Plan. The Board believes this amendment is necessary to ensure that the Company continues to have the ability to attract and retain the services of key individuals essential to the Company’s long-term growth and success.
Reduce Usage of Cash Compensation. If the Company is unable to grant awards under the Plan, our ability to issue equity awards will be extremely limited. As a result, we may be forced to significantly increase cash or cash-based compensation, in an environment where the Company is taking actions to preserve cash by restructuring assets and reducing capital spending, operating expenses and working capital. If the Company is forced to increase cash compensation it could reduce available cash needed to pursue and execute our business strategy.
No Significant Share Increase Since 2020. In 2022, the Company sought shareholder approval for an increase of the number of shares available for issuance under the Plan by 175,000 shares, equal to less than 0.5% of our outstanding shares. No additional shares were sought for issuance under the Plan in 2021. The Company sought 600,000 additional shares under the Plan in 2020 and 820,000 additional shares in 2019.
Repurchases. The Company repurchased 3,100,000 of its ordinary shares in 2022, approximately 1.0 million ordinary shares in 2021, and 800,000 in 2020, which more than offsets the dilutive impact of the additional shares added to the Plan in the proposed amendment.
Description of the Plan
The following summary of the Plan, as amended, is qualified in its entirety by the complete text of the amended and restated Plan contained in Appendix A to this proxy statement. In 2014, the Board adopted and implemented the Plan in connection with our initial public offering. In 2019, our shareholders approved amendments to the Plan to provide for authorization of additional shares, as well as amendments to certain key provisions to better protect shareholder interests and promote effective governance practices. In 2020 shareholders approved an amendment to the Plan to authorize additional shares, and in 2022 shareholders approved amendments to the Plan to authorize additional shares and extend the Plan term, along with other administrative changes. If we do not obtain requisite shareholder approval of the proposed amendment, the Plan will remain in effect without the proposed amendment.
The following highlight the Plan terms designed to protect the interests of our shareholders and promote corporate governance best practices, including:
•
No Automatic or Evergreen Share Replenishment; a fixed number of shares is available under the Plan for future grants and the Company must seek shareholder approval to increase the available shares;
•
No Discounted Option Pricing; options are priced at fair market value on the grant date;
•
No Repricing of Underwater Options; the Plan prohibits repricing of options or SARS, or the substitution or reload of options and SARS, without prior shareholder approval;
•
No Liberal Share Recycling; no reuse of shares withheld for net exercise or taxes;
•
Minimum Vesting Period; subject to Luxembourg lawlimited exceptions set forth below, awards must not vest for 12 months;
2023 Proxy Statement 64
•
No Dividends and providesDividend Equivalents; dividend equivalents are not paid unless and until awards have vested, making such payments subject to the same vesting requirements as awards;
•
No Automatic Grants; the Plan terms do not provide any participant with automatic grants; and
•
Single Plan for Equity Awards; the Plan, and its sub-plan, is the only plan under which equity-based compensation currently may be awarded to our directors, executives and other employees.
Other terms or policies which impact our awards and share ownership include (see “Compensation Discussion and Analysis-Compensation Philosophy and Design-Compensation Committee Practices” for more information):
•
Double Trigger upon CIC. Our executive officers only receive change-in-control benefits under their equity awards or their employment agreements if their employment is also terminated without cause (or by the executive for good reason) within a specified period following a change in control.
•
Stock Ownership Guidelines. Our directors and executive officers are subject to share ownership guidelines which must be achieved by 5 years from the date of hire, and which also impose share retention requirements until guidelines are met.
•
Clawback Policy. The Company maintains a clawback policy which permits cancellation of outstanding vested or unvested equity awards, to “claw back” incentive-based compensation to the extent it was awarded on financial results, which due to an accounting restatement would otherwise have resulted a smaller vested award.
•
No Hedging or Pledging. We prohibit our directors, executive officers, and employees from hedging or pledging the Company’s securities.
Purpose
The purpose of the Plan and the related sub-plan is to advance the interests of the Company by motivating performance through incentive compensation that ties the interests of our directors, executive officers, and senior employees with those of our shareholders. The Plan and sub-plan are also intended to encourage participant ownership in the Company, attract and retain talent, and enable participants to participate in the long-term growth and financial success of the Company.
Eligibility and Participation
Our employees are eligible to participate in the Plan. The Company’s most recent Awards were granted to 125 employees and 15 executive officers in February 2023. Our Company has historically granted each of our non-executive directors annual equity retainer grants under the Plan. Non-employee directors, consultants and advisors of the Company or its affiliates shall be eligible to participate under a separate sub-plan.
Shares Subject to the Plan
The total number of ordinary shares available for Awards under the Plan is currently 6,175,000, which may consist of authorized and unissued shares or treasury shares. Approval of this proposal would add 1,825,000 ordinary shares to the Plan share reserve.
The maximum number of our ordinary shares subject to stock options and the maximum number of shares of our ordinary shares subject to stock appreciation rights, or SARs, that may be granted to any participant in the Plan in any calendar year is each 900,000 shares. The maximum number of our ordinary shares subject to other awards that may be granted to any participant in the Plan in any calendar year is 450,000 shares and the maximum amount payable to any participant in the Plan in any calendar year is $5,000,000 under a cash award.
Shares withheld in the satisfaction of tax withholding requirements or as payment of the exercise or purchase price, or purchased by the Company using proceeds from the Awards, are prohibited from being returned to the Plan’s share reserve for future issuance. The gross number of SAR Awards granted under the Plan, versus the net number of shares delivered under the SAR Award, are deducted from the number of shares remaining available for issuance under the Plan. Any shares underlying Awards settled in cash, or that otherwise expire or become unexercisable without having been exercised, or that are otherwise forfeited or repurchased by the Company due to the failure to vest, may be returned to the share reserve for the equal treatmentPlan for future issuance.
The following table includes information regarding the outstanding equity Awards and shares available for future awards under Plan as of shareholders. March 31, 2023:
| | Options Outstanding | | | | | 1,760,547 | | |
| | Weighted Average Exercise Price of Outstanding Options | | | | | 45.06 | | |
| | Weighted Average Remaining Term of Options Outstanding (years) | | | | | 6.65 | | |
| | Full-Value Awards Outstanding/Unvested (1) | | | | | 1,105,026 | | |
| | Ordinary Shares Outstanding | | | | | 35,141,405 | | |
65 2023 Proxy Statement
| | Overhang (2) | | | | | 10.0% | | |
| | Shares Available for Future Issuance | | | | | 642,392 | | |
| | Shares Requested in Proposed Amendment for Future Awards | | | | | 1,825,000 | | |
| | Diluted Overhang (3) | | | | | 15.2% | | |
(1)
Full-Value Awards are a grant of one or more ordinary shares or a right to receive one or more ordinary shares in the future (including restricted stock, restricted stock units, performance stock and performance stock units). The Company’s Full-Value Awards as of March 31, 2023 consist solely of RSUs and PSUs.
(2)
Overhang consists of the number of shares subject to equity awards outstanding as of March 31, 2023 divided by the number of shares of our common stock outstanding as of March 31, 2023.
(3)
Dilution consists of the number of shares subject to equity awards outstanding as of March 31, 2023 and the number of shares available for future grant under the Plan (assuming approval of the proposed amendment), divided by the number of shares of common stock outstanding as of March 31, 2023.
The table below shows the diluted burn rate relating to equity awards under the Plan for the last three fiscal years:
| | | | | 2020 | | | 2021 | | | 2022 | | | 3-Year Average | |
| | Shares Granted | | | | | 988,604 | | | | | | 570,488 | | | | | | 470,842 | | | | | | 676,645 | | |
| | Average Total Common Shares Outstanding | | | | | 38,347,112 | | | | | | 38,707,800 | | | | | | 35,941,034 | | | | | | 37,665,315 | | |
| | Diluted Burn Rate | | | | | 2.5% | | | | | | 1.5% | | | | | | 1.3% | | | | | | 1.8% | | |
See the Company’s “Equity Compensation Plan Information” in this proxy statement for more information on the Company’s equity usage during 2022.
Awards
The Plan authorizes grants of a variety of types of Awards to maintain flexibility. The Plan permits the granting of:
•
Stock options, which may be incentive stock options (“ISOs”) as defined in Section 422 of the Internal Revenue Code or non-qualified stock options (“NQOs”)
•
stock appreciation rights (“SAR”)
•
restricted stock
•
restricted stock units (“RSU”)
•
performance awards
•
other stock-based awards (collectively referred to as “Awards”)
Administration
The Plan is administered by our compensation committee. Our compensation committee has the authority to, among other things, interpret the Plan, determine eligibility for, grant and determine the terms of awards under the Plan, determine the form of settlement of awards (whether in cash, shares of our ordinary shares or other property), and do all things necessary or appropriate to carry out the purposes of the Plan. Our compensation committee’s determinations under the Plan are conclusive and binding.
Types of Awards
Stock Options. Stock options granted under the Plan may be either NQOs or ISOs. The price of any stock option granted may not be less than the fair market value (or in the case of certain ISOs, 110% of the fair market value) of the Company’s ordinary shares on the date the stock option is granted. The stock option price is payable in cash or certified check, ordinary shares of the Company, through a broker-assisted cashless exercise, by any other method approved by the compensation committee, or any combination of the foregoing. The standard form of payment of the exercise price is by delivery of cash by a broker-dealer as a cashless exercise. The participant will have the rights of a shareholder after giving written notice of exercise and paying the option price, once the shares are recorded as having been issued and transferred.
The compensation committee determines the terms of each stock option grant (including the vesting schedule) at the time of the grant. All stock options will terminate no later than 10 years (or, in the case of certain ISOs, five years) from the date of the grant. To the extent necessary to comply with Section 409A of the Internal Revenue Code, stock options will not include any feature allowing deferral of income beyond the date of exercise (other than through the receipt of restricted stock at exercise).
Stock Appreciation Rights. A SAR entitles the participant, upon settlement, to receive a payment based on the excess of the value of an ordinary share of the Company on the date of settlement over the base price of the SAR, multiplied by the number of SARs being
2023 Proxy Statement 66
settled. SARs may be granted alone or in addition to other Awards. The base price of a SAR may not be less than the fair market value (as defined in the Plan) of an ordinary share of the Company on the date of grant. The compensation committee will determine the vesting requirements and the payment and other terms of a SAR. Vesting may be based on the continued service of the participant for specified time periods or on the attainment of specified business performance goals established by the compensation committee or both. SARs may be payable in cash or in ordinary shares of the Company. A SAR will terminate no later than 10 years from the date of the grant. A SAR will be eligibleforfeited or terminated under the same circumstances as stock options under the Plan, unless otherwise provided in an Award agreement or determined by the compensation committee. To the extent necessary to comply with Section 409A of the Internal Revenue Code, SARs will not include any feature allowing deferral of income beyond the date of exercise.
Restricted Stock. A restricted stock Award represents ordinary shares of the Company that are issued subject to restrictions on transfer and vesting requirements as determined by the compensation committee. Vesting requirements may be based on, among other things, the continued service of the participant for purchase at a minimum pricespecified time periods or on the attainment of one dollar ($1.00) per share and a maximum price of one thousand dollars ($1,000.00) per share. Ordinary shares repurchased fromspecified business performance goals established by the open marketcompensation committee. Restricted stock will be subject to daily volume restrictions per SEC regulations.for a period set forth in the Award agreement. The Boardcompensation committee may provide for an accelerated lapse of the restriction period in an Award agreement upon specified events or standards. Subject to the transfer restrictions and vesting requirements of the Award, the participant will have the same rights as one of the Company’s shareholders, including all voting and dividend rights, during the restriction period, although the compensation committee may provide that restricted stock certificates will be held in escrow during the restriction period (and forfeited or distributed depending on whether applicable performance goals or service restrictions have been met).
Restricted Stock Units. An Award of restricted stock units, or RSUs, provides the participant the right to receive a payment based on the value of an ordinary share of the Company. RSUs may be subject to such vesting requirements, restrictions and conditions to payment as the compensation committee determines are appropriate. Vesting requirements may be based on, among other things, the continued service of the participant for a specified time period or on the attainment of specified business performance goals established by the compensation committee. RSUs will be subject to restrictions for a period set forth in the Award agreement, which period generally will be a minimum of three years from the date of grant. RSU Awards are payable in cash or in ordinary shares of the Company. Participants receiving RSUs will not have, with respect to such RSUs, any of the rights of a shareholder of the Company, although participants may receive dividend equivalents.
Performance Awards. An Award of performance units provides the participant the right to receive cash or ordinary shares of the Company if specified terms and conditions are met. Participants receiving performance awards will not have, with respect to such performance units, any of the rights of a shareholder of the Company. Performance Awards will be subject to restrictions for a period set forth in the Award agreement, which period generally is expected to be a minimum of three years from the date of grant.
Other Stock-Based Awards. Our compensation committee is authorized to make other stock Awards or Awards based on or settled in ordinary shares, which may be subject to other terms and conditions, which may vary from time to time and among participants, as the compensation committee in its discretion may determine.
Other Award Terms and Considerations
No Repricing or Reloads. The Plan specifically prohibits repricing of outstanding stock options or SARs without prior shareholder approval. The Plan also prohibits the substitution, or “reload” of outstanding stock options and SARS and reloads of outstanding stock options without prior shareholder approval. The Plan also prohibits without prior shareholder approval the substitution or buyout of the stock options or SARS for cash, when the exercise price for such a stock option is below the current fair market value or the base value from which appreciation under such SARs are to be measured is below the current fair market value.
Vesting; Termination of Employment or Service. Our compensation committee has the authority to determine the vesting schedule applicable to each award, and to accelerate the vesting or exercisability of any award, except that the compensation committee may only issue Awards that vest or become exercisable within twelve (12) months or longer from the grant date, except in the event of Participants’ death or disability or a five percent (5%) or more carve-out set by the Company.
Our compensation committee will determine the effect of termination of employment or service on an award. Unless otherwise provided by our compensation committee, upon a termination of a participant’s employment or service, all unvested stock options and SARs then held by the participant will terminate and all other unvested awards will be forfeited and all vested stock options and SARs then held by the participant will remain outstanding for three months following such termination, or twelve (12) months in the case of death or permanent disability, or, in each case, until the applicable expiration date, if earlier. All stock options and SARs held by a participant immediately prior to the participant’s termination of employment or service will immediately terminate if such termination is for cause, as defined in the Plan, or occurs in circumstances that would have constituted grounds for the participant’s employment or service to be terminated for cause, in the determination of the compensation committee.
Dividend Equivalents. The compensation committee may provide for the payment of amounts (on terms and subject to conditions established by it) in lieu of cash dividends or other cash distributions with respect to Stock subject to an Award whether or not the holder of such Award is otherwise entitled to share in the actual dividend or distribution in respect of such Award. Any entitlement to dividend equivalents or similar entitlements will be established and administered either consistent with an exemption from, or in compliance with, the requirements of Section 409A. Dividends or dividend equivalent amounts payable in respect to Awards shall be empoweredsubject to determine withinthe
67 2023 Proxy Statement
identical time-based vesting and performance conditions as the limitsunderlying Award and cannot be paid out unless and until all vesting and performance conditions of the authorization set out aboveunderlying Award are met. Additionally, the compensation committee is prohibited from accruing and paying dividends and dividend equivalents on Awards of stock options or SARs.
Non-Transferability of Awards. Awards under the Plan may not be transferred other than by the laws of descent and distribution, unless, for awards other than ISOs, otherwise provided by the compensation committee.
Recovery of Compensation. The compensation committee may cancel, rescind, withhold or otherwise limit or restrict any award at any time under the Plan if the participant is not in compliance with the provisions of the Plan or any award thereunder or if the participant breaches any agreement with our Company with respect to non-competition, non-solicitation or confidentiality. Our compensation committee also may recover any award or payments or gain in respect of any award under the Plan in accordance with its applicable Company’s clawback or recoupment policy, or as otherwise required by applicable law or applicable stock exchange listing standards. See “Compensation Discussion and Analysis-Compensation Philosophy and Design-Compensation Committee Practices” for more information on the Company’s clawback and recoupment policies.
Certain Transactions; Certain Adjustments. In the event of a consolidation, merger or similar transaction or series of related transactions, including a sale or other disposition of shares of our ordinary shares, in which our Company is not the surviving corporation or that results in the acquisition of all or substantially all of our then outstanding shares of ordinary shares by a single person or entity or by a group of persons and/or entities acting in concert, a sale of all or substantially all of our assets or our dissolution or liquidation, our compensation committee may, among other things, provide for the continuation or assumption of outstanding awards, for new grants in substitution of outstanding awards, for the accelerated vesting or delivery of shares under awards or for a cash-out of outstanding awards, in each case on such terms and with such restrictions as it deems appropriate. Except as our compensation committee may otherwise determine, awards not assumed in connection with such a transaction will terminate automatically and, in the case of outstanding restricted stock, will be forfeited automatically upon the consummation of such covered transaction.
In the event of a stock dividend, stock split or combination of shares, including a reverse stock split, recapitalization or other change in our capital structure that constitutes an equity restructuring within the meaning of FASB ASC 718, our compensation committee will make appropriate adjustments to the maximum number of shares of our ordinary shares that may be delivered under, and the ISO and individual share limits included in, the Plan, and will also make appropriate adjustments to the number and kind of shares or securities subject to awards, the exercise prices of such awards or any other terms of awards affected by such change. Our compensation committee will also make the types of adjustments described above to take into account distributions and other events other than those listed above if it determines that such adjustments are appropriate to avoid distortion in the operation of the Plan.
Minimum Vesting Requirement. Generally, all awards granted under the Plan are required to vest at least 12 months after the date of grant. Certain circumstances, including death or disability or a participant, termination due to restructuring or redundancy, or termination due to retirement allow vesting of certain awards to be accelerated under the Plan.
Amendment; Termination. The compensation committee will be able to amend the Plan or outstanding awards, or terminate the Plan as to future grants of awards, except that the compensation committee will not be able to alter the terms of an award if it would affect materially and adversely a participant’s rights under the award without the participant’s consent (unless expressly provided in the Plan or the right to alter the terms of an award was expressly reserved by our compensation committee at the time the award was granted). Shareholder approval will be required for any amendment to the Plan to the extent such approval is required by law, including applicable stock exchange requirements.
Plan Term. No new awards may be granted under the Plan after May 30, 2034, or twenty years after the Plan’s date of adoption, unless the Plan is terminated earlier by the Board. Termination of the Plan would not affect the terms or conditions of any award granted under the Plan prior to termination.
Benefits under the Plan
New Plan Benefits. The compensation committee has discretionary authority to grant Awards pursuant to the Plan, and there is no provision in the Plan for automatic grants. Therefore, future benefits that would be received by directors, executive officers and other employees under the Plan, as amended, are currently not entirely predictable.
Certain Historical Grants under the Plan. As of March 31, 2023, the following table sets forth the number of shares subject to RSU, PSU and stock options Awards that have been granted to the below individuals or groups under the Plan (since its inception in June 2014).
| | Name and Position | | | Number of
Shares (1) | |
| | Frank Bozich, President and Chief Executive Officer | | | | | 773,714 | | |
| | David Stasse, Executive Vice President and Chief Financial Officer | | | | | 281,171 | | |
| | Angelo N. Chaclas, Senior Vice President, CLO, CCO and Corporate Secretary | | | | | 284,591 | | |
| | Andre Lanning, Senior Vice President and Chief Commercial Officer | | | | | 78,112 | | |
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| | Name and Position | | | Number of
Shares (1) | |
| | Paula Cooney, Senior Vice President and Chief Human Resources Officer | | | | | 56,088 | | |
| | All current executive officers (as a group) | | | | | 1,966,199 | | |
| | All current non-executive directors (as a group) | | | | | 180,298 | | |
| | All employees and officers who are not executive officers (as a group) | | | | | 1,244,926 | | |
(1)
Ordinary shares underlying RSU, PSU and stock option awards granted under the Plan.
Tax Treatment of Awards under the Plan
The following discussion of the United States federal income tax implications of Awards under the Plan is based on the provisions of the Internal Revenue Code (and any relevant rulings and regulations issued under the Internal Revenue Code) as of the date of this proxy statement, which are subject to change at any time (possibly with retroactive effect). The tax law is technical and complex, and the discussion below represents only a general summary. It is not intended to be, nor should it be construed to be, legal or tax advice. Shareholders should consult their own professional advisers as to the effects of state, local or foreign laws and regulations to which they may be subject.
Non-qualified stock options. A NQO results in no taxable income to the optionee or deduction to the Company at the time it is granted. An optionee exercising such a stock option will, at that time, realize taxable compensation in the amount of the difference between the stock option price and the then fair market value of the ordinary shares. Subject to the applicable provisions of the Internal Revenue Code, a deduction for federal income tax purposes will be allowable to the Company in the year of exercise in an amount equal to the taxable compensation recognized by the optionee.
The optionee’s basis in such ordinary shares is equal to the sum of the stock option price plus the amount includible in his or her income as compensation upon exercise. Any gain (or loss) upon subsequent disposition of the ordinary shares will be a long-term or short-term gain (or loss), depending upon the holding period of the ordinary shares.
Incentive Stock Options. An ISO results in no taxable ordinary income to the optionee or deduction to the company at the time the ISO is granted or exercised. However, the excess of the fair market value of the ordinary shares acquired over the stock option price is an item of adjustment in computing the alternative minimum taxable income of the optionee. If the optionee holds the ordinary shares received as a result of an exercise of an ISO for at least two years from the date of the grant and one year from the date of exercise, then the gain realized on disposition of the ordinary shares is treated as a long-term capital gain. If the ordinary shares are disposed of during this period, however (i.e., a “disqualifying disposition”), then the optionee will include in income, as compensation for the year of the disposition, an amount equal to the excess, if any, of the fair market value of the ordinary shares received upon exercise of the stock option over the stock option price (or, if less, the excess of the amount realized upon disposition over the stock option price). The excess, if any, of the sale price over the fair market value on the date of exercise will be a short-term capital gain. In such case, the Company will be entitled to a deduction, generally in the year of such a disposition, for the amount includible in the optionee’s income as compensation. The optionee’s basis in the ordinary shares acquired upon exercise of an ISO is equal to the stock option price paid, plus any amount includible in his or her income as a result of a disqualifying disposition.
Stock Appreciation Rights. Generally, the recipient of a SAR will not recognize taxable income at the time the SAR is granted. When the participant receives the appreciation inherent in the SAR, either in cash or stock, the amount of the cash, or the value of the stock, as applicable, will be taxed as ordinary income to the participant at the time it is received. In general, there will be no federal income tax deduction allowed to the Company upon the grant or termination of a SAR. However, upon the settlement of the SAR, the Company will be entitled to a deduction equal to the amount of ordinary income the participant is required to recognize as a result of the settlement.
Other Awards. The current United States federal income tax consequences of other Awards authorized under the Plan are generally in accordance with the following: (1) the fair market value of restricted stock is generally subject to ordinary income tax at the time the restrictions lapse (unless the participant elects taxation at grant, pursuant to Section 83(b)) and (2) the amount of cash paid (or the fair market value of the ordinary shares issued) to settle RSUs and performance units is generally subject to ordinary income tax. In each of the foregoing cases, the Company will generally be entitled to a corresponding federal income tax deduction at the same time the participant recognizes ordinary income.
Section 409A. Section 409A of the Internal Revenue Code imposes certain requirements on non-qualified deferred compensation arrangements. These include requirements with respect to an individual’s election to defer compensation and the individual’s selection of the timing and conditionsform of repurchasesdistribution of the deferred compensation. Section 409A also generally provides that distributions may be made only on specified dates or on or following the occurrence of certain events (e.g., the individual’s separation from service or the individual’s death). Section 409A imposes restrictions on an individual’s ability to change his or her distribution timing or form after the compensation has been deferred. For certain officers and other individuals, Section 409A requires that such individual’s distributions of non-qualified deferred compensation in connection with a separation from service commence no earlier than six months after such individual’s separation from service.
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We intend that Awards granted under the Share Repurchase Program. ThePlan will either comply with or be exempt from Section 409A of the Internal Revenue Code and the regulations and guidance promulgated thereunder. Awards subject to Section 409A, but not compliant with Section 409A, could result in accelerated taxation of the Awards and an additional 20% tax and interest charge tax to the participant. These potential penalties on the participant could reduce the value of grants subject to Section 409A and adversely affect the Company’s ability to achieve the Plan’s purposes.
Section 280G. Under certain circumstances, accelerated vesting, exercise or payment of awards under the Plan in connection with a change-in-control of the Company might be deemed an “excess parachute payment” for purposes of the golden parachute payment provisions of Section 280G of the Internal Revenue Code. To the extent it is so considered, the participant holding the Award would be subject to an excise tax equal to 20% of the amount of the excess parachute payment, and the Company would be denied a tax deduction for the excess parachute payment.
Approval of the Amendment
If the amendment to the Plan is approved by the shareholders, the amended Plan will become effective on the date of the Annual Meeting. Our Board believesintends to cause the Share Repurchase Program is an effective use of its cash earnings and provides flexibilityadditional ordinary shares that would become available for usissuance to be opportunisticregistered on a Form S-8 Registration Statement to be filed with the SEC at our expense. If shareholders do not approve this proposal, the amendment will not become effective and the Plan will continue in repurchasing shares. Additionally, the Board believes the Share Repurchase Program will assist in offsetting shareholder dilution resulting from periodic grants of equity incentive awards.YOURits current form.
| | | THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE AMENDMENT TO THE COMPANY’S OMNIBUS INCENTIVE PLAN. | | |
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Shareholder Proposals & Director Nominations
Table of Contents
SHAREHOLDER PROPOSALS AND DIRECTOR NOMINATIONS
Shareholder Proposals & Director Nominations
A shareholder who intends to nominate a director or present a proposal at the 20172024 annual general meeting of shareholders and who wishes the nomination or proposal to be included in the proxy materials for that meeting pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, as amended, must submit the proposal in writing to us so that it is received by our Corporate Secretary no later than February 20, 2017.January 2, 2024. In addition, one or more shareholders representingorder for a shareholder proposal submitted outside of Rule 14a-8 to be considered at least ten percent (10%) of our ordinary shares outstanding may submit written proposals to the Company for inclusion on the agenda for the 20172024 annual general meeting of shareholders, if such written proposals areproposal must be received by the Company at least 21its registered office not more than 120 days before(i.e., January 2, 2024) and not less than 90 days (i.e., February 1, 2024) prior to the first anniversary of the date this proxy statement was first released to shareholders. However, if the date of our 20172024 annual general meeting is changed by more than 30 days from the date of shareholders. 2023 annual general meeting, notice by the shareholder to be timely must be so delivered not earlier than the 120th day prior to the 2024 annual general meeting and not later than the later of the 90th day prior to the 2024 annual general meeting, or the 10th day following the day on which public announcement of the date of the 2024 annual general meeting is first made.
Written proposals may be mailed to us at Trinseo S.A., 1000 Chesterbrook Boulevard, Suite 300, Berwyn, Pennsylvania 19312 Attn:PLC (Attn: Corporate Secretary. ASecretary) at our registered office, Riverside One, Sir John Rogerson’s Quay, Dublin 2, Dublin, Ireland, D02 X576.
Each submission relating to the nomination of persons to be elected to the Board, or other business proposed to be brought up before the meeting must meet the form, deadline and other requirements in Article 101 of our Constitution, including the applicable notice, information and consent provisions. Board nominations must:
•
set forth the name, age, business address and residence address of each individual whom the shareholder who intendsproposes to nominate for election or re-election as a directordirector;
•
set forth set forth the class and number of our shares which are owned of record and beneficially by such nominee;
•
set forth the date or present any other proposal atdates on which such shares were acquired and the 2017 annual general meetinginvestment intent of shareholders but does not wishsuch acquisition;
•
include a completed and signed questionnaire, representation and agreement required by Article 101.1(f) of our Articles of Association;
•
include the proposalinformation required by Article 101.3 of our Articles of Association.
In addition to the requirements as to form and substance established by the SEC, shareholder proposals must be a proper subject for shareholder action under Irish law and our Constitution to be included in theour proxy materials for that meeting must provide written notice of the nomination or proposal to us no earlier than 120 days and no later than 90 days before our 2017 annual general meeting of shareholders.materials. We reserve the right to reject, rule out of order, or take other appropriate action with respect to any proposal that does not comply with these and other applicable requirements. Our articles of association describeConstitution describes in full the requirements for submitting proposals at the annual general meeting. The notice must be given in the manner and must include the information and representations required by our Constitution.
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Householding
SEC rules permit a single set of annual reports and proxy statements to be sent to any household at which two or more shareholders reside if they appear to be members of the same family. Each shareholder continues to receive a separate proxy card. This procedure is referred to as householding. While the Company does not household in mailings to its shareholders of record, a number of brokerage firms with account holders who are Company shareholders have instituted householding. In these cases, a single proxy statement and annual report will be delivered to multiple shareholders sharing an address unless contrary instructions have been received from the affected shareholders. Once a shareholder has received notice from his or her broker that the broker will be householding communications to the shareholder’s address, householding will continue until the shareholder is notified otherwise or until the shareholder revokes his or her consent. If at any time a shareholder no longer wishes to participate in householding and would prefer to receive a separate proxy statement and annual report, he or she should notify his or her broker. Any shareholder can receive a copy of the Company’s proxy statement and annual report by contacting the Company at its registered office at Riverside One, Sir John Rogerson’s Quay, Dublin 2, Dublin, Ireland, D02 X576, Attention: Secretary or by accessing it on the Company’s website at www.trinseo.com.
Shareholders who hold their shares through a broker or other nominee who currently receive multiple copies of the proxy statement and annual report at their address and would like to request householding of their communications should contact their broker.
2023 Proxy Statement 72
APPENDIX A
TRINSEO PLC
AMENDED AND RESTATED
2014 OMNIBUS INCENTIVE PLAN
(Amended and Restated
as of June 14, 2023)
WHEREAS:
A.
On May 30, 2014, Trinseo S.A., a public limited company (société anonyme) incorporated under the laws of Luxembourg, adopted the Trinseo S.A. 2014 Omnibus Incentive Plan (as so adopted and amended, from time to time, in respect of periods prior to the Effective Time (as defined below), the “Original Plan”).
B.
On October 8, 2021, the re-domiciliation of Trinseo S.A. from Luxembourg to Ireland pursuant to a merger by acquisition under the European Communities (Cross-Border Mergers) Regulations 2008 of Ireland (SI 157/2008), as amended, and the Luxembourg law of 10 August 2015, as amended, was completed (the “Merger”). Pursuant to the Merger: (i) Trinseo PLC, a public limited company incorporated under the laws of Ireland, by operation of law and universal succession of title, became entitled to the assets of Trinseo S.A. and assumed the liabilities of Trinseo S.A. from the effective time of the Merger (the “Effective Time”); (ii) ordinary shares of $0.01 each (nominal value) were allotted and issued by the Trinseo PLC to the shareholders of Trinseo S.A. (other than Trinseo S.A. as holder of shares in itself), on a one-for-one basis, at the Effective Time as consideration for the transfer of the assets and liabilities of Trinseo S.A.; and (iii) Trinseo S.A. ceased to exist following completion of the Merger.
C.
In connection with the Merger, among other matters, at the Effective Time, the Original Plan and all awards then outstanding under the Original Plan were assumed by Trinseo PLC and the Original Plan was amended and restated on the terms set out herein and renamed the Trinseo PLC Amended And Restated 2014 Omnibus Incentive Plan (the Original Plan as so assumed, amended and restated at the Effective Time and as may, from time to time, be amended in respect of periods following the Effective Time, the “Plan”).
D.
Save as otherwise expressly provided herein, the Plan shall apply to all awards granted prior to or following the Effective Time.
1.
DEFINED TERMS
Exhibit A, which is incorporated by reference, defines the terms used in the Plan and sets forth certain operational rules related to those terms.
2.
PURPOSE
The Plan has been established to advance the interests of the Company by providing for the grant to Participants of Stock-based Awards.
3.
ADMINISTRATION
The Administrator has discretionary authority, subject only to the express provisions of the Plan, to interpret the Plan; determine eligibility for and grant Awards; determine, modify or waive the terms and conditions of any Award; determine the form of settlement of Awards (whether in cash, shares of Stock or other property); prescribe forms, rules and procedures relating to the Plan; and otherwise do all things necessary or appropriate to carry out the purposes of the Plan. Determinations of the Administrator made under the Plan will be conclusive and will bind all parties.
4.
LIMITS ON AWARDS UNDER THE PLAN
(a) Number of Shares. The maximum number of shares of Stock that may be delivered in satisfaction of Awards under the Plan and under the Trinseo PLC Non-Employee Equity Incentive Plan (which is a sub-plan of the Plan and is attached hereto as Appendix A) is 8,000,000 shares. Up to the total number of shares available for Awards to employee Participants may be issued in satisfaction of ISOs, but nothing in this Section 4(a) will be construed as requiring that any, or any fixed number of, ISOs be awarded under the Plan. The limits set forth in this Section 4(a) shall be construed to comply with Section 422 of the Code. For purposes of this Section 4(a), the shares of Stock withheld by the Company in payment of the exercise price or purchase price (including any nominal value payable in respect of an Award provided always that such nominal value must be paid by the Participant or some other person permitted to do so by Irish law as provided for in Section 6(a)(9)) of the Award, in satisfaction of tax withholding requirements with respect to the Award, or purchased by the Company using proceeds from Awards are prohibited from being returned back to the Plan’s share reserve for future issuance. The gross number of SAR awards granted under the Plan, as opposed to the net number of shares actually delivered under the SAR Award, will be deducted from the number of shares remaining available for issuance pursuant to the Awards granted under the Plan. For the avoidance of doubt, any shares of Stock underlying Awards settled in cash or that otherwise expire or become unexercisable without having been exercised or that are forfeited to or repurchased or redeemed by the Company due to the failure to vest may be returned to the Plan for future issuance. To the extent consistent with the requirements of Section 422 and the regulations thereunder, and with other applicable
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legal requirements (including applicable stock exchange requirements), Stock issued under awards of an acquired company that are converted, replaced or adjusted in connection with the acquisition shall not reduce the number of shares of Stock available for Awards under the Plan.
(b) Type of Shares. Stock delivered by the Company under the Plan may be newly issued Stock or treasury Stock acquired by the Company. No fractional shares of Stock will be delivered under the Plan.
(c) Individual Limits. The following additional limits will apply to Awards of the specified type granted, or in the case of Cash Awards, payable to any person in any calendar year:
(1)
Stock Options: 900,000 shares of Stock.
(2)
SARs: 900,000 shares of Stock.
(3)
Awards other than Stock Options, SARs or Cash Awards: 450,000 shares of Stock.
(4)
Cash Awards: $5,000,000.
In applying the foregoing limits, (i) all Awards of the specified type granted to the same person in the same calendar year will be aggregated and made subject to one limit; (ii) the limits applicable to Stock Options and SARs refer to the number of shares of Stock subject to those Awards; (iii) the share limit under clause (3) refers to the maximum number of shares of Stock that may be delivered, or the value of which could be paid in cash or other property, under an Award or Awards of the type specified in clause (3) assuming a maximum payout; and (iv) the dollar limit under clause (4) refers to the maximum dollar amount payable under an Award or Awards of the type specified in clause (4) assuming a maximum payout.
5.
ELIGIBILITY AND PARTICIPATION
The Administrator will select Participants from among key Employees of the Company and its Affiliates who are in a position to contribute significantly to the success of the Company and its Affiliates. Eligibility for ISOs is limited to individuals described in the first sentence of this Section 5 who are employees of the Company or of a “parent corporation” or “subsidiary corporation” of the Company as those terms are defined in Section 424 of the Code. Eligibility for Stock Options other than ISOs is limited to individuals described in the first sentence of this Section 5 who are providing direct services on the date of grant of the Stock Option to the Company or to a subsidiary of the Company that would be described in the first sentence of Treas. Regs. §1.409A-1(b)(5)(iii)(E). Non-employee Directors and consultants and vendors of the Company or Affiliates shall be eligible to participate under the Trinseo PLC Non-Employee Equity Incentive Plan (which is a sub-plan of the Plan and is attached hereto as Appendix A.
6.
RULES APPLICABLE TO AWARDS
(a) All Awards.
(1) Award Provisions. The Administrator will determine the terms of all Awards, subject to the limitations provided herein. By accepting (or, under such rules as the Administrator may prescribe, being deemed to have accepted) an Award, the Participant will be deemed to have agreed to the terms of the Award and the Plan. Notwithstanding any provision of this Plan to the contrary, awards of an acquired company that are converted, replaced or adjusted in connection with the acquisition may contain terms and conditions that are inconsistent with the terms and conditions specified herein, as determined by the Administrator.
(2) Term of Plan. No Awards may be made after twenty years from the Date of Adoption, but previously granted Awards may continue beyond that date in accordance with their terms.
(3) Transferability. Neither ISOs nor, except as the Administrator otherwise expressly provides in accordance with the third sentence of this Section 6(a)(3), other Awards may be transferred other than by will or by the laws of descent and distribution. During a Participant’s lifetime, ISOs (and, except as the Administrator otherwise expressly provides in accordance with the third sentence of this Section 6(a)(3), SARs and NSOs) may be exercised only by the Participant. The Administrator may permit the gratuitous transfer (i.e., transfer not for value) of Awards other than ISOs, subject to such limitations as the Administrator may impose.
(4) Vesting, etc. The Administrator will determine the time or times at which an Award will vest or become exercisable and the terms on which a Stock Option or SAR will remain exercisable. Except in the event of the Participant’s death or disability, termination due to restructuring or redundancy, or a five percent (5%) carve-out of the number of shares of Stock that may be delivered in satisfaction of Awards under the Plan (as defined in Section 4(a)), all Awards will only vest or become exercisable after a minimum of twelve months from the grant date. Without limiting the foregoing, the Administrator may at any time accelerate the vesting or exercisability of an Award, regardless of any adverse or potentially adverse tax or other consequences resulting from such acceleration. Unless the Administrator expressly provides otherwise, however, the following rules will apply if a Participant’s Employment ceases:
(A) Immediately upon the cessation of the Participant’s Employment and except as provided in (B) and (C) below, each Stock Option and SAR that is then held by the Participant or by the Participant’s permitted transferees, if any, will
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cease to be exercisable and will terminate and all other Awards that are then held by the Participant or by the Participant’s permitted transferees, if any, to the extent not already vested will be forfeited. (B) Subject to (C) and (D) below, all Stock Options and SARs held by the Participant or the Participant’s permitted transferees, if any, immediately prior to the cessation of the Participant’s Employment, to the extent then exercisable, will remain exercisable for the lesser of (i) a period of three months or (ii) the period ending on the latest date on which such Stock Option or SAR could have been exercised without regard to this Section 6(a)(4), and will thereupon immediately terminate.
(C) All Stock Options and SARs held by a Participant or the Participant’s permitted transferees, if any, immediately prior to the cessation of the Participant’s Employment due to his or her death or by the Company due to his or her Permanent Disability, to the extent then exercisable, will remain exercisable for the lesser of (i) a period of twelve (12) months or (ii) the period ending on the latest date on which such Stock Option or SAR could have been exercised without regard to this Section 6(a)(4), and will thereupon immediately terminate.
(D) All Stock Options and SARs (whether or not exercisable) held by a Participant or the Participant’s permitted transferees, if any, immediately prior to the cessation of the Participant’s Employment will immediately terminate upon such cessation of Employment if the termination is for Cause or occurs in circumstances that in the sole determination of the Administrator would have constituted grounds for the Participant’s Employment to be terminated for Cause.
(5) Additional Restrictions. The Administrator may cancel, rescind, withhold or otherwise limit or restrict any Award at any time if the Participant is not in compliance with all applicable provisions of the Award agreement and the Plan, or if the Participant breaches any agreement with the Company or its Affiliates with respect to non-competition, non-solicitation or confidentiality. Without limiting the generality of the foregoing, the Administrator may recover Awards made under the Plan and payments under or gain in respect of any Award in accordance with any applicable Company clawback or recoupment policy, as such policy may be amended and in effect from time to time, or as otherwise required by applicable law or applicable stock exchange listing standards, including, without limitation, Section 10D of the Securities Exchange Act of 1934, as amended.
(6) Taxes. The Company or any Affiliate shall have the authority and right to deduct or withhold or require a Participant to remit to the Company or any Affiliate, an amount sufficient to satisfy Tax-Related Items with respect to any taxable event concerning a Participant arising as a result of the Plan or to take such other action as may be necessary in the opinion of the Company or any Affiliate, as appropriate, to satisfy withholding obligations for the payment of Tax-Related Items, including but not limited to (i) withholding from the Participant’s wages or other cash compensation; (ii) withholding from the proceeds for the sale of shares of Stock underlying the Award either through a voluntary sale or a mandatory sale arranged by the Company on the Participant’s behalf; or (iii) in the Administrator’s sole discretion and in satisfaction of the foregoing requirement withhold shares of Stock otherwise issuable under an Award (or allow the return of shares of Stock ) having a fair market value equal to the sums required to be withheld. To avoid negative accounting treatment, the number of Shares which may be withheld with respect to the issuance, vesting, exercise or payment of any Award or which may be repurchased from the Participant of such Award in order to satisfy the Participant’s Tax-Related Items liabilities with respect to the issuance, vesting, exercise or payment of the Award may be limited to the number of shares of Stock which have a fair market value on the date of withholding or repurchase equal to the aggregate amount of such liabilities based on the maximum applicable withholding rates. No Stock shall be delivered hereunder to any Participant or other person until the Participant or such other person has made arrangements acceptable to the Company for the satisfaction of the Tax-Related Items withholdings obligations with respect to any taxable event concerning the Participant or such other person arising as a result of the Plan in a manner consistent with Irish law.
(7) Dividend Equivalents, Etc. The Administrator may provide for the payment of amounts (on terms and subject to conditions established by the Administrator) in lieu of cash dividends or other cash distributions with respect to Stock subject to an Award whether or not the holder of such Award is otherwise entitled to share in the actual dividend or distribution in respect of such Award, except for Awards of Stock Options or SARs, for which such payments shall be prohibited. Any entitlement to dividend equivalents or similar entitlements will be established and administered either consistent with an exemption from, or in compliance with, the requirements of Section 409A. Dividends or dividend equivalent amounts payable in respect of Awards shall be subject to the identical time-based vesting and performance conditions as the underlying Award and cannot be paid unless and until all vesting and performance conditions of the underlying Award are met. Dividends or dividend equivalent amounts payable in respect of Awards that are subject to restrictions may be subject to such additional limits or restrictions as the Administrator may impose, consistent with the requirements of the Articles.
(8) Rights Limited. Nothing in the Plan will be construed as giving any person the right to continued employment or service with the Company or its Affiliates, or any rights as a stockholder except as to shares of Stock actually issued under the Plan. The loss of existing or potential profit in Awards will not constitute an element of damages in the event of a termination of Employment for any reason, even if the termination is in violation of an obligation of the Company or any Affiliate to the Participant.
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(9) Purchase Price. At the time of the Award, the Administrator shall determine the price, if any, to be paid by the Participant for each share of Stock subject to the Award. The price to be paid by the Participant shall not be less than the nominal value of a share of Stock (or such higher amount required by applicable Irish law). The purchase price of shares of Stock acquired pursuant to the Award shall be paid or redeemed by a non-Irish incorporated Subsidiary on behalf of the Participant as designated by the Administrator or by the Participant through one or more of the following methods (a) in cash or (b) in any other form of legal consideration that may be acceptable to the Administrator in its discretion and in compliance with applicable Irish law.
(10) Coordination with Other Plans. Awards under the Plan may be granted in tandem with, or in satisfaction of or substitution for or awards made under other compensatory plans or programs of the Company or its Affiliates. For example, but without limiting the generality of the foregoing, awards under other compensatory plans or programs of the Company or its Affiliates may be settled in Stock (including, without limitation, Unrestricted Stock) if the Administrator so determines, in which case the shares delivered will be treated as awarded under the Plan (and will reduce the number of shares thereafter available under the Plan in accordance with the rules set forth in Section 4).
(11) Section 409A. Each Award will contain such terms as the Administrator determines, and will be construed and administered, such that the Award either qualifies for an exemption from the requirements of Section 409A or satisfies such requirements.
(12) Fair Market Value. In determining the fair market value of any share of Stock under the Plan, the Administrator will make the determination in good faith, and consistent with the rules of Section 422 and Section 409A when applicable.
(b)
Stock Options and SARs.
(1) Time And Manner Of Exercise. Unless the Administrator expressly provides otherwise, no Stock Option or SAR will be deemed to have been exercised until the Administrator receives a notice of exercise (in form acceptable to the Administrator), which may be an electronic notice, signed (including electronic signature in form acceptable to the Administrator) by the appropriate person and accompanied by any payment required under the Award. A Stock Option or SAR exercised by any person other than the Participant will not be deemed to have been exercised until the Administrator has received such evidence as it may require that the person exercising the Award has the right to do so. The Administrator may impose conditions on the exercisability of Awards, including limitations on the time periods during which Awards may be exercised or settled.
(2) Exercise Price. The exercise price (or the base value from which appreciation is to be measured) of each Award requiring exercise will be no less than the higher of (a) the nominal value of the Stock subject to the Award and (b) 100% (or in the case of an ISO granted to a ten-percent shareholder within the meaning of subsection (b)(6) of Section 422, 110%) of the fair market value of the Stock subject to the Award, determined as of the date of grant, or such higher amount as the Administrator may determine in connection with the grant.
(3) No Repricing. Except in connection with a corporate transaction involving the Company (which term shall include, without limitation, any stock dividend, stock split, extraordinary cash dividend, recapitalization, reorganization, merger, consolidation, split-up, spin-off, combination, or exchange of shares) or as otherwise contemplated by Section 7 of the Plan, the terms of outstanding Stock Options or SARs, as applicable, may not be amended to reduce the exercise prices of such Stock Options or the base values from which appreciation under such SARs are to be measured other than in accordance with the stockholder approval requirements of the New York Stock Exchange. Unless otherwise submitted to and approved by the Company’s shareholders, any substitution or buyout of Stock Options or SARs for cash, as applicable, shall be prohibited when the exercise price for such Stock Option is below the current fair market value or when the base value from which appreciation under such SARs are to be measured is below the current fair market value.
(4) Payment Of Exercise Price. Where the exercise of an Award is to be accompanied by payment, payment of the exercise price will be by cash or check acceptable to the Administrator or by such other legally permissible means, if any, as may be acceptable to the Administrator.
(5) Maximum Term. Stock Options and SARs will have a maximum term not to exceed ten (10) years from the date of grant (or five (5) years from the date of grant in the case of an ISO granted to a ten-percent shareholder described in Section 6(b)(2) above); provided, however, that, if a Participant still holding an outstanding but unexercised NSO or SAR ten (10) years from the date of grant (or, in the case of an NSO or SAR with a maximum term of less than ten (10) years, such maximum term) is prohibited by applicable law or a written policy of the Company applicable to similarly situated employees from engaging in any open-market sales of Stock, and if at such time the Stock is publicly traded (as determined by the Administrator), the maximum term of such Award will instead be deemed to expire on the thirtieth (30th) day following the date the Participant is no longer prohibited from engaging in such open market sales.
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7.
EFFECT OF CERTAIN TRANSACTIONS
(a) Mergers, etc. Except as otherwise provided in an Award agreement, the following provisions will apply in the event of a Covered Transaction:
(1) Assumption or Substitution. If the Covered Transaction is one in which there is an acquiring or surviving entity, the Administrator may (but, for the avoidance of doubt, need not) provide (i) for the assumption or continuation of some or all outstanding Awards or any portion thereof or (ii) for the grant of new awards in substitution therefor by the acquiror or survivor or an affiliate of the acquiror or survivor.
(2) Cash-Out of Awards. Subject to Section 7(a)(5) below the Administrator may (but, for the avoidance of doubt, need not) provide for payment (a “cash-out”), with respect to some or all Awards or any portion thereof, equal in the case of each affected Award or portion thereof to the excess, if any, of (A) the fair market value of one share of Stock (as determined by the Administrator in its reasonable discretion) times the number of shares of Stock subject to the Award or such portion, over (B) the aggregate exercise or purchase price, if any, under the Award or such portion (in the case of an SAR, the aggregate base value above which appreciation is measured), in each case on such payment terms (which need not be the same as the terms of payment to holders of Stock) and other terms, and subject to such conditions, as the Administrator determines; it being understood that if the exercise or purchase price (or base value) of an Award is equal to or greater than the fair market value of one share of Stock, the Award may be cancelled with no payment due hereunder.
(3) Acceleration of Certain Awards. Subject to Section 7(a)(5) below, the Administrator may (but, for the avoidance of doubt, need not) provide that any Award requiring exercise will become exercisable, in full or in part and/or that the delivery of any shares of Stock remaining deliverable under any outstanding Award of Stock Units (including Restricted Stock Units and Performance Awards to the extent consisting of Stock Units) will be accelerated in full or in part, in each case on a basis that gives the holder of the Award a reasonable opportunity, as determined by the Administrator, following exercise of the Award or the delivery of the shares, as the case may be, to participate as a stockholder in the Covered Transaction.
(4) Termination of Awards Upon Consummation of Covered Transaction. Except as the Administrator may otherwise determine in any case, each Award will automatically terminate (and in the case of outstanding shares of Restricted Stock, will automatically be forfeited) upon consummation of the Covered Transaction, other than Awards assumed pursuant to Section 7(a)(1) above.
(5) Additional Limitations. Any share of Stock and any cash or other property delivered pursuant to Section 7(a)(2) or Section 7(a)(3) above with respect to an Award may, in the discretion of the Administrator, contain such restrictions, if any, as the Administrator deems appropriate to reflect any performance or other vesting conditions to which the Award was subject and that did not lapse (and were not satisfied) in connection with the Covered Transaction. For purposes of the immediately preceding sentence, a cash-out under Section 7(a)(2) above or acceleration under Section 7(a)(3) above will not, in and of itself, be treated as the lapsing (or satisfaction) of a performance or other vesting condition. In the case of Restricted Stock that does not vest and is not forfeited in connection with the Covered Transaction, the Administrator may require that any amounts delivered, exchanged or otherwise paid in respect of such Stock in connection with the Covered Transaction be placed in escrow or otherwise made subject to such restrictions as the Administrator deems appropriate to carry out the intent of the Plan.
(b)
Changes in and Distributions With Respect to Stock.
(1) Basic Adjustment Provisions. In the event of a stock dividend, stock split or combination of shares (including a reverse stock split), recapitalization or other change in the Company’s capital structure that constitutes an equity restructuring within the meaning of FASB ASC 718, the Administrator will make appropriate adjustments to the maximum number of shares of Stock that may be delivered under the Plan, to the maximum number of shares of Stock that may be delivered in satisfaction of ISOs under the Plan, and to the maximum share limits described in Section 4(c) and will also make appropriate adjustments to the number and kind of shares of stock or securities subject to Awards then outstanding or subsequently granted, any exercise or purchase prices (or base values) relating to Awards and any other provision of Awards affected by such change.
(2) Certain Other Adjustments. The Administrator may also make adjustments of the type described in Section 7(b)(1) above to take into account distributions to stockholders other than those provided for in Section 7(a) and 7(b)(1), or any other event, if the Administrator determines that adjustments are appropriate to avoid distortion in the operation of the Plan, having due regard for the qualification of ISOs under Section 422, and the requirements of Section 409A.
(3) Continuing Application of Plan Terms. References in the Plan to shares of Stock will be construed to include any stock or securities resulting from an adjustment pursuant to this Section 7.
A-5 2023 Proxy Statement
8.
LEGAL CONDITIONS ON DELIVERY OF STOCK
The Company will not be obligated to deliver any shares of Stock pursuant to the Plan or to remove any restriction from shares of Stock previously delivered under the Plan until: (i) the Company is satisfied that all legal matters in connection with the issuance and delivery of such shares have been addressed and resolved; (ii) if the outstanding Stock is at the time of delivery listed on any stock exchange or national market system, the shares to be delivered have been listed or authorized to be listed on such exchange or system upon official notice of issuance; and (iii) all conditions of the Award have been satisfied or waived. The Company may require, as a condition to exercise of the Award, such representations or agreements as counsel for the Company may consider appropriate to avoid violation of the Securities Act of 1933, as amended, or any applicable state or non-U.S. securities law. Any Stock required to be issued to Participants under the Plan will be evidenced in such manner as the Administrator may deem appropriate, including book-entry registration or delivery of stock certificates. In the event that the Administrator determines that Stock certificates will be issued to Participants under the Plan, the Administrator may require that certificates evidencing Stock issued under the Plan bear an appropriate legend reflecting any restriction on transfer applicable to such Stock, and the Company may hold the certificates pending lapse of the applicable restrictions.
9.
AMENDMENT AND TERMINATION
The Administrator may at any time or times amend the Plan or any outstanding Award for any purpose which may at the time be permitted by law, and may at any time terminate the Plan as to any future grants of Awards; provided, that, except as otherwise expressly provided in the Plan, the Administrator may not, without the Participant’s consent, alter the terms of an Award so as to affect materially and adversely the Participant’s rights under the Award, unless the Administrator expressly reserved the right to do so at the time the Award was granted. Any amendments to the Plan will be conditioned upon stockholder approval only to the extent, if any, such approval is required by law (including the Code and applicable stock exchange requirements), as determined by the Administrator.
10.
OTHER COMPENSATION ARRANGEMENTS
The existence of the Plan or the grant of any Award will not in any way affect the Company’s right to award a person bonuses or other compensation in addition to Awards under the Plan.
11.
MISCELLANEOUS
(a) Waiver of Jury Trial. By accepting an Award under the Plan, each Participant waives any right to a trial by jury in any action, proceeding or counterclaim concerning any rights under the Plan and any Award, or under any amendment, waiver, consent, instrument, document or other agreement delivered or which in the future may be delivered in connection therewith, and agrees that any such action, proceedings or counterclaim will be tried before a court and not before a jury. By accepting an Award under the Plan, each Participant certifies that no officer, representative, or attorney of the Company has represented, expressly or otherwise, that the Company would not, in the event of any action, proceeding or counterclaim, seek to enforce the foregoing waivers. Notwithstanding anything to the contrary in the Plan, nothing herein is to be construed as limiting the ability of the Company and a Participant to agree to submit disputes arising under the terms of the Plan or any Award made hereunder to binding arbitration or as limiting the ability of the Company to require any eligible individual to agree to submit such disputes to binding arbitration as a condition of receiving an Award hereunder.
(b) Limitation of Liability. Notwithstanding anything to the contrary in the Plan, neither the Company, nor any Affiliate, nor the Administrator, nor any person acting on behalf of the Company, any Affiliate, or the Administrator, will be liable to any Participant or to the estate or beneficiary of any Participant or to any other holder of an Award by reason of any acceleration of income, or any additional tax (including any interest and penalties), asserted by reason of the failure of an Award to satisfy the requirements of Section 422 or Section 409A or by reason of Section 4999 of the Code, or otherwise asserted with respect to the Award.
12.
MISCELLANEOUS ESTABLISHMENT OF SUB-PLANS
The Administrator may from time to time establish one or more sub-plans under the Plan for purposes of satisfying applicable securities, or other regulatory or tax laws of various jurisdictions. The Administrator will establish such sub-plans by adopting supplements to the Plan setting forth (i) such limitations on the Administrator’s discretion under the Plan as it deems necessary or desirable and (ii) such additional terms and conditions not otherwise inconsistent with the Plan as it deems necessary or desirable. All supplements so established will be deemed to be part of the Plan, but each supplement will apply only to Participants within the affected jurisdiction (as determined by the Administrator).
13.
GOVERNING LAW
(a) Certain Requirements of Corporate Law. Awards will be granted and administered consistent with the requirements of applicable law of Ireland relating to the issuance of stock and the consideration to be received therefor, and with the applicable requirements of the stock exchanges or other trading systems on which the Stock is listed or entered for trading, in each case as determined by the Administrator.
2023 Proxy Statement A-6
(b) Other Matters. Except as otherwise provided by the express terms of an Award agreement, under a sub-plan described in Section 12 or as provided in Section 13(a) above, the provisions of the Plan and of Awards under the Plan and all claims or disputes arising out of or based upon the Plan or any Award under the Plan or relating to the subject matter hereof or thereof will be governed by and construed in accordance with the domestic substantive laws of the State of Pennsylvania without giving effect to any choice or conflict of laws provision or rule that would cause the application of the domestic substantive laws of any other jurisdiction.
(c) Jurisdiction. By accepting an Award, each Participant will be deemed to (a) have submitted irrevocably and unconditionally to the jurisdiction of the federal and state courts located within the geographic boundaries of the United States District Court for the District of Pennsylvania for the purpose of any suit, action or other proceeding arising out of or based upon the Plan or any Award; (b) agree not to commence any suit, action or other proceeding arising out of or based upon the Plan or an Award, except in the federal and state courts located within the geographic boundaries of the United States District Court for the District of Pennsylvania; and (c) waive, and agree not to assert, by way of motion as a defense or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above-named courts that its property is exempt or immune from attachment or execution, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that the Plan or an Award or the subject matter thereof may not be enforced in or by such court.
A-7 2023 Proxy Statement
Exhibit A
Definition of Terms
The following terms, when used in the Plan, will have the meanings and be subject to the provisions set forth below:
“Administrator”: The Compensation Committee, except that the Compensation Committee may delegate (i) to one or more of its members (or one or more other members of the Board (including the full Board)) such of its duties, powers and responsibilities as it may determine; (ii) to one or more officers of the Company the power to grant Awards to the extent permitted by applicable law; and (iii) to such Employees or other persons as it determines such ministerial tasks as it deems appropriate. In the event of any delegation described in the preceding sentence, the term “Administrator” will include the person or persons so delegated to the extent of such delegation.
“Affiliate”: Any corporation or other entity that stands in a relationship to the Company that would result in the Company and such corporation or other entity being treated as one employer under Section 414(b) and Section 414(c) of the Code, provided that, for purposes of determining treatment as a single employer under Section 414(b) and Section 414(c) of the Code, “50%” shall replace “80%” in the applicable stock ownership requirements under such sections of the Code and the regulations thereunder.
“Articles”: The articles of association.
association of the Company.
TRINSEO S.A.
1000 CHESTERBROOK BLVD.
SUITE 3000
BERWYN, PA 19312
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TO“Award”: Any or a combination of the following:
(i) Stock Options.
(ii) SARs.
(iii) Restricted Stock.
(iv) Unrestricted Stock.
(v) Stock Units, including Restricted Stock Units.
(vi) Performance Awards.
(vii) Cash Awards.
(viii) Awards (other than Awards described in (i) through (vii) above) that are convertible into or otherwise based on Stock.
“Board”: The Board of Directors of the Company.
“Cash Award”: An Award denominated in cash.
“Cause”: In the case of any Participant who is party to an employment or severance-benefit agreement that contains a definition of “Cause,” the definition set forth in such agreement will apply with respect to such Participant under the Plan for so long as such agreement is in effect. In the case of any other Participant, “Cause” will mean, as determined by the Administrator in its reasonable judgment, (i) a substantial failure of the Participant to perform the Participant’s duties and responsibilities to the Company or subsidiaries or substantial negligence in the performance of such duties and responsibilities; (ii) the commission by the Participant of a felony or a crime involving moral turpitude; (iii) the commission by the Participant of theft, fraud, embezzlement, material breach of trust or any material act of dishonesty involving the Company or any of its subsidiaries; (iv) a significant violation by the Participant of the code of conduct of the Company or its subsidiaries or of any material policy of the Company or its subsidiaries, or of any statutory or common law duty of loyalty to the Company or its subsidiaries; (v) material breach of any of the terms of the Plan or any Award made under the Plan, or of the terms of any other agreement between the Company or subsidiaries and the Participant; or (vi) other conduct by the Participant that could reasonably be expected to be harmful to the business, interests or reputation of the Company.
“Code”: The U.S. Internal Revenue Code of 1986 as from time to time amended and in effect, or any successor statute as from time to time in effect.
“Compensation Committee”: The Compensation Committee of the Board.
“Company”: Trinseo PLC, a company incorporated in Ireland or, where the context requires, with respect to periods prior to the Effective Time, Trinseo S.A.
“Covered Transaction”: Any of (i) a consolidation, merger, or similar transaction or series of related transactions, including a sale or other disposition of stock, in which the Company is not the surviving corporation or that results in the acquisition of all or substantially all of the Company’s then outstanding ordinary shares by a single person or entity or by a group of persons and/or entities acting in concert, (ii) a sale or transfer of all or substantially all the Company’s assets, or (iii) a dissolution or liquidation of the Company. Where a Covered Transaction involves a tender offer that is reasonably expected to be followed by a merger described in clause (i) (as determined by the Administrator), the Covered Transaction will be deemed to have occurred upon consummation of the tender offer.
“Date of Adoption”: The earlier of the dates (both prior to the Effective Time) that the Plan was approved by the Company’s shareholders or adopted by the Board, as determined by the Compensation Committee.
2023 Proxy Statement A-8
“Director”: A member of the Board.
“Employee”: Any person who is employed by the Company or an Affiliate.
“Employment”: A Participant’s employment or other service relationship with the Company and its Affiliates. Employment will be deemed to continue, unless the Administrator expressly provides otherwise, so long as the Participant is employed by, or otherwise is providing services in a capacity described in Section 5 to the Company or an Affiliate. If a Participant’s employment or other service relationship is with an Affiliate and that entity ceases to be an Affiliate, the Participant’s Employment will be deemed to have terminated when the entity ceases to be an Affiliate unless the Participant transfers Employment to the Company or its remaining Affiliates. Notwithstanding the foregoing and the definition of “Affiliate” above, in construing the provisions of any Award relating to the payment of “nonqualified deferred compensation” (subject to Section 409A) upon a termination or cessation of Employment, references to termination or cessation of employment, separation from service, retirement or similar or correlative terms will be construed to require a “separation from service” (as that term is defined in Section 1.409A- 1(h) of the U.S. Treasury Regulations, after giving effect to the presumptions contained therein) from the Company and from all other corporations and trades or businesses, if any, that would be treated as a single “service recipient” with the Company under Section 1.409A-1(h)(3) of the U.S. Treasury Regulations. The Company may, but need not, elect in writing, subject to the applicable limitations under Section 409A, any of the special elective rules prescribed in Section 1.409A- 1(h) of the U.S. Treasury Regulations for purposes of determining whether a “separation from service” has occurred. Any such written election will be deemed a part of the Plan.
“ISO”: A Stock Option intended to be an “incentive stock option” within the meaning of Section 422. Each Stock Option granted pursuant to the Plan will be treated as providing by its terms that it is to be an NSO unless, as of the date of grant, it is expressly designated as an ISO.
“NSO”: A Stock Option that is not intended to be an “incentive stock option” within the meaning of Section 422.
“Participant”: A person who is granted an Award under the Plan or any sub-plan.
“Performance Award”: An Award subject to Performance Criteria.
“Performance Criteria”: Specified criteria, other than the mere continuation of Employment or the mere passage of time, the satisfaction of which is a condition for the grant, exercisability, vesting or full enjoyment of an Award. A Performance Criterion will mean an objectively determinable measure or measures of performance relating to any or any combination of the following (measured either absolutely or by reference to an index or indices and determined either on a consolidated basis or, as the context permits, on a divisional, subsidiary, line of business, project or geographical basis or in combinations thereof): sales; revenues; assets; expenses; earnings before or after deduction for all or any portion of interest, taxes, depreciation, amortization or equity expense, whether or not on a continuing operations or an aggregate or per share basis; return on equity, investment, capital, capital employed or assets; one or more operating ratios; operating income or profit, including on an after-tax basis; net income; borrowing levels, leverage ratios or credit rating; market share; capital expenditures; cash flow; stock price; stockholder return; sales of particular products or services; customer acquisition or retention; acquisitions and divestitures (in whole or in part); joint ventures, strategic alliances, licenses or collaborations; spin-offs, split-ups and the like; reorganizations; recapitalizations, restructurings, financings (issuance of debt or equity) or refinancings; manufacturing or process development; or environmental health and/or safety metrics. A Performance Criterion and any targets with respect thereto determined by the Administrator need not be based upon an increase, a positive or improved result or avoidance of loss. The Administrator may provide, by the deadline that otherwise applies to the establishment of the terms of any Award intended to qualify for such exception, that one or more of the Performance Criteria applicable to such Award will be adjusted in an objectively determinable manner to reflect events (for example, the impact of charges for restructurings, discontinued operations, mergers, acquisitions, extraordinary items, and other unusual or non- recurring items, and the cumulative effects of tax or accounting changes, each as defined by U.S. or international generally accepted accounting principles) occurring during the performance period that affect the applicable Performance Criterion or Criteria.
“Permanent Disability”: In the case of any Participant who is party to an employment or severance-benefit agreement that contains a definition of “Permanent Disability” (or similar term), the definition set forth in such agreement will apply with respect to such Participant under the Plan for so long as such agreement is in effect. In the case of any other Participant, “Permanent Disability” shall mean a disability that would entitle a Participant to long-term disability benefits under the Company’s long-term disability plan to which the Participant participates. Notwithstanding the foregoing, however, in the case of any Award that is subject to Section 409A and is payable upon a Participant’s Permanent Disability, the Participant shall be treated as having a Permanent Disability only if the Participant’s condition also satisfies the definition of “disability” in Treasury Regulation 1.409A-3(i)(4).
“Restricted Stock”: Stock subject to restrictions requiring that it be redelivered or offered for sale to the Company if specified conditions are not satisfied.
“Restricted Stock Unit”: A Stock Unit that is, or as to which the delivery of Stock or cash in lieu of Stock is, subject to the satisfaction of specified performance or other vesting conditions.
“SAR”: A right entitling the holder upon exercise to receive an amount (payable in cash or in shares of Stock of equivalent value) equal to the excess of the fair market value of the shares of Stock subject to the right over the base value from which appreciation under the SAR is to be measured.
A-9 2023 Proxy Statement
“Section 409A”: Section 409A of the Code.
“Section 422”: Section 422 of the Code.
“Stock”: Ordinary shares of the Company, nominal value $0.01 per share and “stockholder” shall be interpreted accordingly where referring to holders of Stock in the Company.
“Stock Option”: An option entitling the holder to acquire shares of Stock upon payment of the exercise price.
“Stock Unit”: An unfunded and unsecured promise, denominated in shares of Stock, to deliver Stock or cash measured by the value of Stock in the future.
“Tax-Related Items” means (i) federal, state, and local taxes and taxes imposed by any jurisdiction (including but not limited to, income tax, social security or insurance contributions, payroll tax, fringe benefits tax, payment on account, employment tax obligations, stamp taxes, and any other taxes that may be due) required by law to be withheld and (ii) any employer tax liability shifted to a Participant.
“Unrestricted Stock”: Stock not subject to any restrictions under the terms of the Award.
2023 Proxy Statement A-10
TRINSEO PLC
NON-EMPLOYEE EQUITY INCENTIVE PLAN
(THE “NON-EMPLOYEE PLAN”)
Section 1. Introduction.
(a)
The Non-Employee Plan is a sub-plan of the Trinseo PLC Amended & Restated 2014 Omnibus Incentive Plan (the “Plan”) and permits the grant of Awards to non-employee directors, consultants and vendors of the Company or Affiliate who are not employees (as at the time of the relevant grant) of any such company (each, a “Participant”).
(b)
For the avoidance of doubt, the Non-Employee Plan (i) shall not prejudice the status of the Plan as an employees’ share scheme within the meaning of section 64 of the Companies Act 2014 and (ii) operates separately from the Plan.
Section 2. Definitions and Interpretation
(a)
In the Non-Employee Plan, words and expressions used in the Plan shall, unless otherwise specified below, apply in relation to Awards granted under the Non-Employee Plan.
(b)
Except as modified in the Non-Employee Plan, all the provisions of the Plan relevant to Awards shall be incorporated into the Non-Employee Plan as if fully set out herein so as to be part of the Non-Employee Plan.
(c)
These rules of the Non-Employee Plan take precedence if there is any inconsistency between them and the rules of the Plan.
(d)
In these rules of the Non-Employee Plan, whenever the terms “Employee” or “Employment” are otherwise used in the context of matters following the grant of an Award, they shall be construed in the context of that person being a non-employee director, consultant or vendor, and termination of Employment means the Participant ceasing to be a non-employee director, consultant or vendor of the Company or an Affiliate; provided that, for avoidance of doubt, a Termination of Service will be deemed to occur if an Affiliate of which the Participant is a consultant or vendor ceases to be an Affiliate, unless they remain a consultant or vendor of the Company or another Affiliate.
A-11 2023 Proxy Statement
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TRINSEO PLCRIVERSIDE ONESIR JOHN ROGERSON'S QUAYDUBLIN 2DUBLIN, D02 X576IRELANDSCAN TOVIEW MATERIALS & VOTEVOTE BY INTERNET - www.proxyvote.com or scan the QR Barcode aboveUse the Internet to transmit your voting instructions and for electronic delivery of informationup until 11:59 p.m. Eastern Time on Monday, June 12, 2023. Follow the instructions to obtainyour records and to create an electronic voting instruction form.ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALSIf you would like to reduce the costs incurred by our company in mailing proxy materials, you canconsent to receiving all future proxy statements, proxy cards and annual reports electronicallyvia e-mail or the Internet. To sign up for electronic delivery, please follow the instructions aboveto vote using the Internet and, when prompted, indicate that you agree to receive or accessproxy materials electronically in future years.VOTE BY PHONE - 1-800-690-6903Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m. Eastern Timeon Monday, June 12, 2023. Have your proxy card in hand when you call and then follow theinstructions.VOTE BY MAILMark, sign and date your proxy card and return it in the postage-paid envelope wehave provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way,Edgewood, NY 11717.To vote and/or attend the meeting, go to the “Register for Meeting” link at www.proxyvote.com.TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:KEEPV12153-P91474KEEP THIS PORTION FOR YOUR RECORDS
DETACH AND RETURN THIS PORTION ONLY
THISRECORDSTHIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
TRINSEO S.A.
The Board of Directors recommends you vote FOR the following proposals:
| | For
| | Against
| | Abstain
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1.
| | To elect the three Class I directors specifically named in the proxy statement, each for a term of three years.
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| | Christopher D. Pappas
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| | Stephen M. Zide
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| | Felix S. Hauser
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2.
| | To ratify the Board of Directors’ appointment of Stephen F. Thomas, to fill a Class III vacancy, with a remaining term of two years.
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3.
| | To ratify the Company’s directors’ compensation program
| | o
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4.
| | To approve, on an advisory basis, of the compensation paid by the Company to its named executive officers.
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5.
| | To approve the Company’s annual accounts prepared in accordance Luxembourg GAAP for the year ended December 31, 2015 (the “Luxembourg Annual Accounts”) and its consolidated financial statements prepared in accordance U.S. GAAP including a footnote reconciliation of equity and net income IFRS for the year ended December 31, 2015 (the “Consolidated Accounts”) (together, the “Luxembourg Statutory Accounts”).
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| | To resolve on the allocation of the results of the year ended December 31, 2015.
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7.
| | To approve the granting and discharge of the Company’s directors and auditor for the performance of their respective duties during the year ended December 31, 2015.
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8.
| | To ratify the appointment of PricewaterhouseCoopers Société cooperative to be our independent auditors for all statutory accounts required under Luxembourg law for the year ending December 31, 2015.
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9.
| | To ratify the appointment of PricewaterhouseCoopers Société cooperative to be our independent auditors for all statutory accounts required under Luxembourg law for the year ending December 31, 2015.
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10.
| | To authorize the delegation to the Board the authority to make repayments of equity at times an in amounts set by the Board in its discretion and within the limits of Luxembourg law.
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11.
| | To authorize the Board to repurchase up to 4.5 million of its outstanding ordinary shares over the next two years.
| | o
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DETACH AND RETURN THIS PORTION ONLYTRINSEO PLCThe Board of Directors recommends you vote FOR proposals 1-7.1. To elect, by separate resolutions, eleven (11) directors specificallynamed in the proxy statement, each to serve for a term ofone year expiring at the close of the 2024 Annual General Meeting;For address changes and/or comments, please check this boxAgainst AbstainNominees:1a. K’Lynne Johnson1b. Joseph Alvarado1c. Frank A. Bozich2. To approve, on an advisory basis, the compensation paid by theCompany to its named executive officers.For Against Abstain1d. Victoria Brifo3. To ratify, by non-binding advisory vote, the appointment ofPricewaterhouseCoopers LLP as the Company’s independentregistered public accounting firm for the year endingDecember 31, 2023 and write them onto authorize, by binding vote, the back where indicated. o
NOTE:AuditCommittee of the Board to set its auditors’ remuneration.1e. Jeffrey Cote1f. Pierre-Marie De Leener4. To approve a proposal to grant the Board authority to issue sharesunder Irish law.1g. Jeanmarie Desmond5. To approve a proposal to grant the Board authority to opt out ofstatutory pre-emption rights, with respect to up to 10% of issuedordinary share capital, under Irish law.1h. Matthew Farrell6. To set the price range for the Company’s re-issuance of treasuryshares, as described in the Company’s proxy statement.1i. Sandra Beach Lin7. To approve an amendment to the Company’s Omnibus IncentivePlan.NOTE: Such other business as may properly come before the meeting or anyorany adjournment thereof.
Pleasethereof.1k. Mark TomkinsPlease sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally.signpersonally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer.
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Signature [PLEASE SIGN WITHIN BOX]
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officer.Signature [PLEASE SIGN WITHIN BOX] DateSignature (Joint Owners) Date
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Important Notice Regarding the Availability of Proxy Materials for the Annual General Meeting:The Notice and Proxy Statement and Annual Report isForm 10-K are available at www.proxyvote.com.
TRINSEO S.A.
Annualwww.proxyvote.com.V12154-P91474TRINSEO PLCAnnual General Meeting of Shareholders
June 21, 2016ShareholdersJune 14, 2023 11:00 a.m. CEST
This30 A.M., I.S.T.This proxy is solicited by the Board of Directors
TheDirectorsThe shareholder(s) hereby appoint(s) Christopher D. Pappas,Frank Bozich, David Stasse and Angelo N. Chaclas, or Suzanne Kersten, or eithereach of them, as proxies, each with the powerthepower to appoint histheir substitute, and hereby authorize(s) them to represent and to vote, as designated on the reverse side of thisofthis ballot, all of the ordinary sharesOrdinary Shares of TRINSEO S.A.PLC that the shareholder(s) is/are entitled to vote at the Annual General Meeting ofMeetingof Shareholders to be held at 11:00 a.m. CEST,30 A.M., I.S.T. on June 21, 2016, at 4 rue du Fort Niedergrünewald, BP 512/Quartier Européen Nord, L-2015 Luxembourg, Grand Duchy of Luxembourg,14, 2023, and any adjournment or postponement thereof.
Thisthereof.This proxy, when properly executed, will be voted in the manner directed herein. If no such direction is made, this proxythisproxy will be voted in accordance with the Board of Directors’ recommendations.
Address Changes/Comments:
(If you noted any Address Changes/Comments above, please mark corresponding box on the reverse side.)
ContinuedDirectors' recommendations.Continued and to be signed on reverse side
sideImportant Notice Regarding the Availability of Proxy Materials for the Annual General Meeting:The Notice and Proxy Statement and Form 10-K are available at www.proxyvote.com.
0001519061 4 2022-01-01 2022-12-31
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