Description of Equity Compensation and Other Plans
We are authorized to issue common shares under the following plans:
· | | Deferred compensation plan; and |
· | | Employee stock purchase plans. |
We also maintain a share plan for our non-employee directors but any shares needed to satisfy our obligations under those plans are purchased in the open market, so there is no dilutive effect. We also grant cash-based awards under our phantom stock plan.
Copies of our stock incentive plan, deferred compensation plan and employee stock purchase plans are available to any shareholder upon request by writing to: Thomson Reuters, Attention: Chief Legal Officer and Company Secretary, 333 Bay Street, Suite 300, Toronto, Ontario M5H 2R2, Canada.
The tables set forth in Appendix A to this circular provide information regarding the key features of our plans and reflect the impact of the share consolidation (reverse stock split) described in Appendix A. Our director compensation plan is described in the “About Our Directors – Director Compensation and Share Ownership” section of this circular.
Pension and Other Retirement Benefits
The following describes pension and other retirement benefits provided to our named executive officers. In 2020, David Wong was considered a U.S. employee prior to his relocation to Canada in January 2021.
Defined Benefit Pension Plans
Steve Hasker, Michael Friedenberg and David Wong do not participate in a defined benefit pension plan.
Brian Peccarelli, Jim Smith and Stephane Bello participate in a broad based, U.S. defined benefit pension plan which has been closed to new participants since 2006. Mike Eastwood participated in the plan through April 2019. In 2020, we announced that we will freeze benefit accruals in the plan for participating employees effective as of January 1, 2023. The plan is funded by one of our wholly owned U.S. subsidiaries and is qualified under U.S. federal income tax laws. Benefits under the plan are subject to a maximum annual benefit based on eligible compensation limits set forth by the U.S. Internal Revenue Code. In 2020, the eligible compensation limit was $285,000 and the maximum annual benefit limit under the pension plan was $230,000.
Defined Contribution Plans
Steve Hasker, Mike Eastwood and David Wong participate in a Canadian defined contribution pension plan (DCPP). Our company contributes 15% of each of their base salary to their individual DCPP account, up to the Canada Income Tax Act (ITA) contribution limit (C$27,830 in 2020). Once the ITA limit is reached, the 15% allocation continues in a Supplemental Retirement Plan (SRP), where a notional account will be tracked and held in the executive’s name. There is no cap to the dollar value that can be allocated to the SRP.
Brian Peccarelli, Michael Friedenberg and Jim Smith participate in a 401(k) retirement savings plan, which provides for company matching contributions to amounts contributed by each of them to the plan. David Wong participated in this plan in 2020. Stephane Bello also participates in this plan and received matching contributions until his retirement from the company. Participating employees can contribute up to 50% of their eligible compensation on a combined before-tax or after-tax basis. For participants in a U.S. defined benefit pension plan (Brian Peccarelli and Jim Smith), the amount of company matching contributions is 50% of the first 6% of eligible compensation that is contributed by the participant. Employees who do not participate in a U.S. defined benefit pension plan (such as Michael Friedenberg) receive company matching contributions equal to 100% of the first 4% of eligible compensation that they contributed. The maximum before-tax and/or Roth 401(k) contribution that could be made by each of them in 2020 was $19,500 per year (or $26,000 per year for participants age 50 and over).
Retirement Plus Plans
We provide a supplemental benefit to Steve Hasker and Mike Eastwood through an SRP. In 2020, Steve and Mike received allocations of C$161,920 and C$108,295, respectively. David Wong became eligible for this supplemental benefit in 2021.
We provide a supplemental benefit to Brian Peccarelli and Jim Smith and provided such a benefit to Stephane Bello through a “retirement plus” plan which is an unfunded, non-qualified defined benefit plan. Under this benefit, we provide allocations with respect to compensation above the eligible compensation limits imposed by the U.S. Internal Revenue Service (IRS) and subject to a maximum eligible “retirement plus” plan compensation limit of $300,000. In 2020, the IRS compensation limit was $285,000. As a result, Brian Peccarelli, Jim Smith and Stephane Bello received allocations of $1,143, $1,176 and $892, respectively, in 2020 under this plan. Amounts under this plan are paid from our general assets. Mike Eastwood ceased participating in that plan at the end of April 2019 and has not received allocations to that plan since that time.
Page 88 Management Proxy Circular and Notice of Annual Meeting of Shareholders