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SECURITIES AND EXCHANGE COMMISSION
Exchange Act of 1934 (Amendment No. )
Filed by a Party other than the Registranto
o | Preliminary Proxy Statement | |
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QUANEX BUILDING PRODUCTS CORPORATION | January 24, 2011 | |
1900 West Loop South Suite 1500 Houston, Texas 77027 (713) 961-4600 | Dear Fellow Stockholder: You are cordially invited to attend the Company’s Annual Meeting of Stockholders to be held at 8:00 a.m., C.S.T., on Thursday, February 24, 2011, at the Company’s principal executive offices at 1900 West Loop South, 15th Floor, Houston, Texas. | |
This year you will be asked to vote in favor of the election of three directors, in favor of an advisory vote approving the Company’s executive compensation structure, in favor of an amendment to the Company’s 2008 Omnibus Incentive Plan, and in favor of ratifying the appointment of Deloitte & Touche LLP as the Company’s external auditors. In addition, you will be asked to provide an advisory vote indicating whether you prefer that the Company seek shareholder advisory votes on executive compensation every one, two, or three years. These proposals are more fully explained in the attached proxy statement, which you are encouraged to read. | ||
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE IN FAVOR OF EACH PROPOSAL OUTLINED IN THE ATTACHED PROXY, AND IN FAVOR OF A ONE-YEAR TIMELINE FOR COMPENSATION ADVISORY VOTES. THE BOARD FURTHER URGES YOU TO VOTE AT YOUR EARLIEST CONVENIENCE, WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING. | ||
Thank you for your continued support. | ||
Sincerely, | ||
/s/ DAVID D. PETRATIS | ||
David D. Petratis | ||
Chairman of the Board |
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To Be Held February 24, 2011
(1) | To elect three directors to serve until the Annual Meeting of Stockholders in 2014; |
(2) | To provide a non-binding advisory vote approving the Company’s executive compensation program; |
(3) | To provide a non-binding advisory vote on the proposed timeline for seeking executive compensation advisory votes in the future; |
(4) | To approve an amendment to the Company’s 2008 Omnibus Incentive Plan to increase the number of shares available for grant under the Plan; |
(5) | To ratify the appointment of Deloitte & Touche LLP as the Company’s external auditors; and |
(6) | To transact such other business as may properly come before the meeting or any adjournment or adjournments thereof. |
By order of the Board of Directors, | ||||
/s/ KEVIN P. DELANEY | ||||
Kevin P. Delaney Senior Vice President — General Counsel and Secretary |
January 24, 2011
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To Be Held February 24, 2011
FOR THE ANNUAL MEETING TO BE HELD ON FEBRUARY 24, 2011:
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ELECTION OF DIRECTORS
Nominees for election for term expiring at the 2014 | Director | |||||||||
Annual Meeting (Class I Directors) | Principal Occupation | Age | Since | |||||||
Susan F. Davis | Executive Vice President of Human Resources of Johnson Controls, Inc., a global leader in automotive systems, battery technology and building controls (Milwaukee, Wisconsin). | 57 | 2007 | |||||||
Joseph D. Rupp | Chairman, President and Chief Executive Officer of Olin Corporation, a basic materials company concentrated in chemicals and ammunition (Clayton, Missouri). | 60 | 2007 | |||||||
Curtis M. Stevens | Executive Vice President, Administration and Chief Financial Officer of Louisiana-Pacific Corporation, a leading building materials manufacturer (Nashville, Tennessee). | 58 | 2010 | |||||||
Directors whose terms expire at the 2012 Annual Meeting (Class II Directors) | ||||||||||
Donald G. Barger, Jr. | Retired Executive Vice President and Chief Financial Officer of YRC Worldwide Inc. (formerly Yellow Roadway Corporation), a provider of transportation services throughout North America and other international markets (Overland Park, Kansas). | 67 | 2007 | |||||||
David D. Petratis | Chairman, President and Chief Executive Officer, Quanex Building Products Corporation (Houston, Texas). | 53 | 2008 | |||||||
Nominees for election for term expiring at the 2013 Annual Meeting (Class III Director) | ||||||||||
William C. Griffiths | Former Chairman of the Board, President and Chief Executive Officer of Champion Enterprises, Inc., a leading producer of modular and manufactured housing (Troy, Michigan). | 59 | 2009 | |||||||
LeRoy D. Nosbaum | Retired Chairman and Chief Executive Officer of Itron, Inc., a leading technology provider to the global energy and water industries and a leading provider of intelligent metering, data collection and utility software solutions (Spokane, Washington) | 64 | 2010 |
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ADVISORY (NON-BINDING) VOTE ON EXECUTIVE COMPENSATION
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ADVISORY (NON-BINDING) VOTE ON THE FREQUENCY OF THE
ADVISORY VOTE ON EXECUTIVE COMPENSATION
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APPROVAL OF AMENDMENT TO THE COMPANY’S
2008 OMNIBUS INCENTIVE PLAN
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Maximum Number of Shares of | ||||
Common Stock That May be Granted to | ||||
Type of Award | a Participant During a Fiscal Year | |||
Option | 350,000 | |||
SAR | 350,000 | |||
Performance/Restricted Stock | 175,000 | |||
Performance Unit Payable in Stock | 175,000 |
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Restricted Stock Awards | Stock Options | |||||||||||||||
Number of | Grant Date | Number of | Grant Date | |||||||||||||
Units | Fair Value | Units | Fair Value | |||||||||||||
Name and Position | (#) | ($) | ($) | (#) | ||||||||||||
David D. Petratis | 27,500 | 464,750 | 128,900 | 936,007 | ||||||||||||
Chairman of the Board, President & Chief Executive Officer | ||||||||||||||||
Brent L. Korb | 8,900 | 150,410 | 41,900 | 304,257 | ||||||||||||
Senior Vice President — Finance & Chief Financial Officer | ||||||||||||||||
Kevin P. Delaney | 7,500 | 126,750 | 35,300 | 256,331 | ||||||||||||
Senior Vice President — General Counsel & Secretary | ||||||||||||||||
Jairaj T. Chetnani | 1,900 | 32,110 | 8,800 | 63,901 | ||||||||||||
Vice President — Treasurer | ||||||||||||||||
Deborah M. Gadin | 1,700 | 28,730 | 8,000 | 58,092 | ||||||||||||
Vice President — Controller | ||||||||||||||||
Executive Group | 47,500 | 802,750 | 222,900 | 1,618,588 | ||||||||||||
Non-executive Director Group | — | — | — | — | ||||||||||||
Non-Executive Officer Employee Group | 16,700 | 282,230 | 129,700 | 956,927 | ||||||||||||
TOTAL | 64,200 | 1,084,980 | 352,600 | 2,575,515 |
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RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITOR
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Name and Age | Office and Length of Service | |
David D. Petratis, 53 | Chairman of the Board, President and Chief Executive Officer since 2008 | |
Brent L. Korb, 38 | Senior Vice President — Finance and Chief Financial Officer since 2008 | |
Kevin P. Delaney, 49 | Senior Vice President — General Counsel and Secretary since 2007 | |
Jairaj T. Chetnani, 39 | Vice President — Treasurer since 2008 | |
Deborah M. Gadin, 41 | Vice President — Controller since 2008 |
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• | Annual Cash Retainer(1) — $40,000/year paid quarterly |
• | Board Meeting Fees(1) — $1,500/meeting ($1,250/telephonic meeting) |
• | Committee Meeting Fees(1) — $1,250/meeting |
• | Committee Chairman Fees(1) |
• | $7,500/year paid quarterly to the chairman of the Nominating and Corporate Governance Committee (who also serves as the lead director) |
• | $10,000/year paid quarterly to the chairmen of the Audit Committee and Compensation and Management Development Committee | ||
• | Lead Director fee of $7,500 | ||
• | Executive Committee Chair receives no extra pay |
• | Annual Stock Retainer(2) — Equivalent value of $25,000 in restricted stock units and equivalent value of $50,000 in options to purchase shares of the Company’s common stock. Both the restricted stock units and the stock options vest immediately upon issuance on October 31, however the restricted stock units are restricted until the director ceases to serve in such role. |
• | Initial Stock Option Grant(2) — Following the first full year of service as a director, each non-employee director receives an initial stock option grant to purchase 5,000 shares of the Company’s common stock. These options vest immediately. |
• | Initial Transaction-Related Stock Option Grant— Directors who served as directors of Quanex Corporation received an initial stock option grant of 10,000 options on the date the Company was spun off from Quanex Corporation. |
• | Expense Reimbursement— Directors are reimbursed for their expenses relating to attendance at meetings. |
1. | Non-employee directors are permitted to defer all or any part of their cash retainers and fees under the Quanex Building Products Corporation Deferred Compensation Plan (the “DC Plan”). These deferrals are placed into notional accounts maintained under the DC Plan and are deemed invested in cash, units denominated in Common Stock, or any of the accounts available under the Company’s qualified 401(k) plan, as the director elects. If a director elects to make a deferral to his or her notional common stock unit account for a period of three full years or more, a matching award equal to 20% of the amount deferred is made by the Company to the director’s notional account. The Board elected to temporarily suspend the match effective April 1, 2009, due to the turbulent economic conditions at that time. The number of units that is deemed invested in Company common stock units and credited to a director’s notional account is equal to the number of shares of Common Stock that could have been purchased with the dollar amount deferred or matched based on the closing price of the Common Stock on the New York Stock Exchange on the date the amount would have been paid had it not been deferred. If a dividend or other distribution is declared and paid on Common Stock, for each notional common stock unit credited to a director’s account a corresponding credit will be accrued in the director’s notional matching account. Except with respect to matching deferrals (and dividend deferrals, if any), all director deferrals are 100% vested. Matching deferrals (and dividend deferrals, if any) are 100% vested, unless a director receives a distribution from the DC Plan for any reason other than death, disability or retirement, within three years after a deferral was credited to his or her notional common stock unit account. If a director receives such a distribution from the DC Plan, any matching amount corresponding to the deferral that has been credited for less than three years, plus any dividends or other distributions that correspond to such matching amount, will be forfeited. No payments may be made under the DC Plan until a distribution is permitted in accordance with the terms of the DC Plan. In the event of a “change of control” of the Company, any amount credited to a director’s account is fully vested and is payable in cash within five days after the change of control occurs. A “change in control” is defined generally as (i) an acquisition of securities resulting in an individual or entity or group thereof becoming, directly or indirectly, the beneficial owner of 20% or more of either (a) the Company’s then-outstanding Common Stock or (b) the combined voting power of the then-outstanding voting securities of the Company entitled to vote generally in the election of directors, (ii) a change in a majority of the persons who were members of the Board of Directors as of December 12, 2007 (the “Incumbent Board”), (iii) generally, a reorganization, merger or consolidation or sale of the Company or disposition of all or substantially all of the assets of the Company, or (iv) the approval by the stockholders of the Company of a complete liquidation or dissolution of the Company. For this purpose, an individual will be treated as a member of the Incumbent Board if he becomes a director subsequent to December 12, 2007, and his election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board; unless his initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of an individual, entity or group other than the Board. All distributions under the DC Plan will be made in cash. Any deferral or payment permitted under the DC Plan will be administered in a manner that is intended to comply with Section 409A of the Internal Revenue Code of 1986. |
2. | Restricted stock unit grants and stock option grants are issued from the Quanex Building Products Corporation 2008 Omnibus Incentive Plan. |
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Effective August 1, 2010, we amended our director compensation structure. Following that date, our non-employee directors receive the following compensation: |
• | Annual Cash Retainer(1) — $50,000/year paid quarterly |
• | Committee Member Retainer(1) — |
• | Member of Audit Committee: $7,500/year paid quarterly |
• | Member of Compensation and Management Development Committee: $5,000/year paid quarterly |
• | Member of Nominating and Corporate Governance Committee: $5,000/year paid quarterly |
• | Committee Chairman Fees(1) — |
• | Chairman of Audit Committee: $15,000/year paid quarterly |
• | Chairman of Compensation and Management Development Committee: $10,000/year paid quarterly | ||
• | Chairman of Nominating and Corporate Governance Committee: $10,000/year paid quarterly |
• | Lead Director Fee(1)—$20,000/year paid quarterly |
• | Annual Stock Retainer(2) — Equivalent value of $25,000 in restricted stock units and equivalent value of $50,000 in options to purchase shares of the Company’s common stock. Both the restricted stock units and the stock options vest immediately upon issuance on October 31, however the restricted stock units are restricted until the director ceases to serve in such role. |
• | Initial Stock Option Grant(2) — Following the first full year of service as a director, each non-employee director receives an initial stock option grant to purchase 5,000 shares of the Company’s common stock. These options vest immediately. |
• | Expense Reimbursement— Directors are reimbursed for their expenses relating to attendance at meetings. |
1. | Non-employee directors are permitted to defer all or any part of their cash retainers and fees under the Quanex Building Products Corporation Deferred Compensation Plan (the “DC Plan”). These deferrals are placed into notional accounts maintained under the DC Plan and are deemed invested in cash, units denominated in Common Stock, or any of the accounts available under the Company’s qualified 401(k) plan, as the director elects. If a director elects to make a deferral to his or her notional common stock unit account for a period of three full years or more, a matching award equal to 20% of the amount deferred is made by the Company to the director’s notional account. The Board elected to temporarily suspend the match effective April 1, 2009, due to the turbulent economic conditions at that time. The number of units that is deemed invested in Company common stock units and credited to a director’s notional account is equal to the number of shares of Common Stock that could have been purchased with the dollar amount deferred or matched based on the closing price of the Common Stock on the New York Stock Exchange on the date the amount would have been paid had it not been deferred. If a dividend or other distribution is declared and paid on Common Stock, for each notional common stock unit credited to a director’s account a corresponding credit will be accrued in the director’s notional matching account. Except with respect to matching deferrals (and dividend deferrals, if any), all director deferrals are 100% vested. Matching deferrals (and dividend deferrals, if any) are 100% vested, unless a director receives a distribution from the DC Plan for any reason other than death, disability or retirement, within three years after a deferral was credited to his or her notional common stock unit account. If a director receives such a distribution from the DC Plan, any matching amount corresponding to the deferral that has been credited for less than three years, plus any dividends or other distributions that correspond to such matching amount, will be forfeited. No payments may be made under the DC Plan until a distribution is permitted in accordance with the terms of the DC Plan. In the event of a “change of control” of the Company, any amount credited to a director’s account is fully vested and is payable in cash within five days after the change of control occurs. A “change in control” is defined generally as (i) an acquisition of securities resulting in an individual or entity or group thereof becoming, directly or indirectly, the beneficial owner of 20% or more of either (a) the Company’s then-outstanding Common Stock or (b) the combined voting power of the then-outstanding voting securities of the Company entitled to vote generally in the election of directors, (ii) a change in a majority of the persons who were members of the Board of Directors as of December 12, 2007 (the “Incumbent Board”), (iii) generally, a reorganization, merger or consolidation or sale of the Company or disposition of all or substantially all of the assets of the Company, or (iv) the approval by the stockholders of the Company of a complete liquidation or dissolution of the Company. For this purpose, an individual will be treated as a member of the Incumbent Board if he becomes a director subsequent to December 12, 2007, and his election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board; unless his initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of an individual, entity or group other than the Board. All distributions under the DC Plan will be made in cash. Any deferral or payment permitted under the DC Plan will be administered in a manner that is intended to comply with Section 409A of the Internal Revenue Code of 1986. | |
2. | Restricted stock unit grants and stock option grants are issued from the Quanex Building Products Corporation 2008 Omnibus Incentive Plan. |
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Change in | ||||||||||||||||||||||||||||
Pension Value & | ||||||||||||||||||||||||||||
Nonqualified | ||||||||||||||||||||||||||||
Fees Earned | Deferred | |||||||||||||||||||||||||||
or Paid in | Stock | Option | Compensation | All Other | ||||||||||||||||||||||||
Cash(1) | Awards(2) | Awards(2) | Earnings(3) | Compensation(4) | Total | |||||||||||||||||||||||
Name | Year | ($) | ($) | ($) | ($) | ($) | ($) | |||||||||||||||||||||
Donald G. Barger, Jr. | 2010 | 65,750 | 25,192 | 50,385 | — | 920 | 142,247 | |||||||||||||||||||||
Susan F. Davis | 2010 | 64,500 | 25,192 | 50,385 | — | 602 | 140,679 | |||||||||||||||||||||
William C. Griffiths | 2010 | 62,000 | 25,192 | 85,586 | — | 220 | 172,998 | |||||||||||||||||||||
LeRoy D. Nosbaum | 2010 | 26,500 | 25,192 | 50,385 | — | — | 102,077 | |||||||||||||||||||||
Joseph D. Rupp | 2010 | 69,500 | 25,192 | 50,385 | — | 602 | 145,679 | |||||||||||||||||||||
Curtis M. Stevens | 2010 | — | 25,192 | 50,385 | — | — | 75,577 |
(1) | Amounts shown reflect fees earned by the directors from Quanex Building Products Corporation during fiscal year 2010. During fiscal 2010, Mr. Barger and Ms. Davis elected to defer cash compensation of $65,750 and $64,500, respectively, under the DC Plan in the form of notional common stock units, and their accounts were credited with 4,052 and 3,959 notional common stock units, respectively. | |
(2) | These columns show respectively, the aggregate grant date fair value for restricted stock units and stock options awarded in fiscal 2010 computed in accordance with FASB ASC Topic 718. Director grants vest immediately and as such are expensed on the date of grant. A discussion of the assumptions used in computing the grant date fair values may be found in Note 14 to Quanex Building Products Corporation’s audited financial statements on Form 10-K for the year ended October 31, 2010. These values reflect the Company’s assumptions to determine the accounting expense for these awards and do not necessarily correspond to the actual value that may be recognized by directors. |
Restricted Stock Units | Stock Options | |||||||||||||||||||||||
Grants | Outstanding | Grants | Outstanding | |||||||||||||||||||||
Grant Date | as of October | Grant Date | as of October | |||||||||||||||||||||
Fair Value | 31, 2010 | Fair Value | 31, 2010 | |||||||||||||||||||||
Name | Grant Date | ($) | (#) | Grant Date | ($) | (#) | ||||||||||||||||||
Barger | 10/31/2010 | 25,192 | 7,971 | 10/31/2010 | 50,385 | 32,300 | ||||||||||||||||||
Davis | 10/31/2010 | 25,192 | 5,698 | 10/31/2010 | 50,385 | 32,300 | ||||||||||||||||||
Griffiths | 10/31/2010 | 25,192 | 2,969 | 10/31/2010 | 50,385 | 16,879 | ||||||||||||||||||
2/26/2010 | 35,201 | |||||||||||||||||||||||
Nosbaum | 10/31/2010 | 25,192 | 1,398 | 10/31/2010 | 50,385 | 6,390 | ||||||||||||||||||
Rupp | 10/31/2010 | 25,192 | 5,698 | 10/31/2010 | 50,385 | 32,300 | ||||||||||||||||||
Stevens | 10/31/2010 | 25,192 | 1,398 | 10/31/2010 | 50,385 | 6,390 |
(3) | The Company does not provide a pension plan for non-employee directors. None of the directors received preferential or above-market earnings on deferred compensations. | |
(4) | Amounts shown represent dividends on outstanding restricted stock units. |
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• | David D. Petratis — Chairman, President and CEO | ||
• | Brent L. Korb — Senior Vice President, Finance and CFO | ||
• | Kevin P. Delaney — Senior Vice President — General Counsel and Secretary | ||
• | Jairaj T. Chetnani — Vice President — Treasurer | ||
• | Deborah M. Gadin — Vice President — Controller |
• | We reorganized the Company to realize market synergies of our Engineered Products Group (EPG) divisions, resulting in 11% year over year growth amid declining markets that continue to remain under pressure. | ||
• | We enhanced our position as a market leader in energy-efficient window systems with the launch of our EnergyCore product, earning several awards in the process. | ||
• | We focused efforts on managing available cash, to position the Company to take advantage of the market turnaround, increasing available cash from $123 million to $187 million during one of the most trying times in our industry’s history. | ||
• | We eliminated tax gross up payments on executive perquisites, effective December 31, 2009. | ||
• | We implemented a recoupment policy for cash-based incentive compensation programs, effective December 1, 2009. |
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Objective | How We Meet our Objectives | |
Attract and retain effective leadership | • We provide a competitive total pay package, taking into account the base salary, incentives, benefits and perquisites for each executive. | |
• We regularly benchmark our pay programs against the competitive market, comparing both fixed and variable, at-risk compensation that is tied to short and long-term performance; we use the results of this analysis as context in making pay adjustments. | ||
• Our plans include three-year performance cycles on LTIP awards, three-year vesting schedules on equity incentives, and career-weighted vesting on our supplemental retirement plan to motivate long-term retention. | ||
Motivate and reward executives for achieving specific financial goals | • We offer a compensation program that focuses on variable, performance-based compensation (through Annual and Long-Term Incentive Awards). | |
• Specific financial performance measures used in the incentive programs include: | ||
• Annual incentive awards (AIA) use return on invested capital (ROIC) for corporate participants and return on net assets (RONA) for division executives. These profit efficiency ratios motivate executives to efficiently employ the capital entrusted to them. | ||
• Long Term Incentive Plan (LTIP) awards use compounded earnings per share (EPS) growth goals to motivate long-term focus on bottom-line performance. | ||
Create a strong financial incentive to meet or exceed long-term financial goals and build long-term value | • We link a significant part of total compensation to Quanex’s financial and stock price performance — 71% of compensation mix is performance-based. | |
• We deliver 75% of long-term incentives in the form of equity compensation. | ||
• Long-term compensation opportunities are weighted to deliver more than two times the target short-term incentive opportunity, resulting in a significant portion of our total compensation delivered in the form of long-term incentive. | ||
• Emphasizing long-term shareowner returns, we encourage significant Quanex stock ownership among executives. | ||
Align executive and shareholder interests | • The ultimate value of two-thirds of our annual equity grants is driven by stock price performance over the grant date value. | |
• We maintain stock ownership goals for executives and encourage officers to retain shares acquired upon option exercises until their respective goals are met. |
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Actuant Corp. | Encore Wire Corp. | Nordson Corp. | ||
Albany International Corp. | EnPro Industries Inc. | Olympic Steel Inc. | ||
American Woodmark Corp.* | Gibraltar Industries Inc.* | Simpson Manufacturing Inc.* | ||
Apogee Enterprises Inc. * | Global Industries Ltd. | Superior Industries International | ||
Astec Industries Inc. | Graco Inc. | Texas Industries Inc. | ||
Builders Firstsource Inc.* | Greenbrier Companies Inc. | Titan International Inc. | ||
Castle (A M) & Co. | Griffon Corporation* | Trex Company, Inc.* | ||
CLARCOR Inc. | H&E Equipment Services Inc. | Universal Forest Products Inc.* | ||
Compass Minerals International Inc. | Headwaters Inc. | Valmont Industries Inc. | ||
Drew Industries Inc.* | Louisiana-Pacific Corp.* | Watts Water Technologies Inc. | ||
Eagle Materials Inc.* | Martin Marietta Materials Inc. |
* | The eleven companies in the Reference Group identified by the asterisk are those we consider more traditional peers (i.e., Industry Reference Group). These companies are used by the Compensation Committee to evaluate Company performance, as they tend to best reflect the operational and financial performance of our industry. |
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Name and Principal Position | Annual Base Salary ($) | |||
David D. Petratis Chairman, President and CEO | 700,000 | |||
Brent L. Korb Senior Vice President — Finance and CFO | 341,250 | |||
Kevin P. Delaney Senior Vice President — General Counsel and Secretary | 287,922 | |||
Jairaj T. Chetnani Vice President — Treasurer | 205,000 | |||
Deborah M. Gadin Vice President — Controller | 185,606 |
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Goal | Threshold | Target | Maximum | Actual Results | ||||||||||||
Return on Invested Capital (ROIC) | 0.56 | % | 2.55 | % | 4.16 | % | 5.83 | % |
QBP Change vs. | AIA Growth | |||
Market | Modifier | |||
-25% and below | 75 | % | ||
-17.5% to -25% | 83 | % | ||
-10% to -17.5% | 92 | % | ||
-10% to +10% | 100 | % | ||
+10% to +17.5% | 108 | % | ||
+17.5% to +25% | 117 | % | ||
+25% and above | 125 | % |
Expressed as a % of Salary
Participant | Threshold | Target | Maximum | |||||||||
CEO | 25.00 | % | 100.00 | % | 200.00 | % | ||||||
SVPs | 18.75 | % | 75.00 | % | 150.00 | % | ||||||
VPs | 10.00 | % | 40.00 | % | 80.00 | % |
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2010 Eligible | AIA | 2010 | 2010 AIA | |||||||||||||
Name | Earnings | Target | AIA % | Payout | ||||||||||||
David D. Petratis | $ | 700,000 | 100 | % | 200 | % | $ | 1,400,000 | ||||||||
Brent L. Korb | $ | 339,896 | 75 | % | 150 | % | $ | 509,844 | ||||||||
Kevin P. Delaney | $ | 287,337 | 75 | % | 150 | % | $ | 431,005 | ||||||||
Jairaj T. Chetnani | $ | 204,583 | 40 | % | 80 | % | $ | 163,667 | ||||||||
Deborah M. Gadin | $ | 185,156 | 40 | % | 80 | % | $ | 148,124 |
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Expressed as a % of Salary
Title | Target | |||
Chairman, President and CEO | 300 | % | ||
Senior Vice President — Finance and CFO | 200 | % | ||
Senior Vice President — General Counsel and Secretary | 200 | % | ||
Vice Presidents | 70 | % |
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Relative Total | 3-Yr. Cumulative | |||||||||||||||||||
Shareholder Return | Compounded Annual | Performance Unit Value | ||||||||||||||||||
Milestones | Percentile | EPS Growth % | R-TSR | EPS | Total | |||||||||||||||
Maximum | 75 | % | 12 | % | $ | 100.00 | $ | 100.00 | $ | 200.00 | ||||||||||
Target | 60 | % | 9 | % | $ | 50.00 | $ | 50.00 | $ | 100.00 | ||||||||||
Threshold | 40 | % | 6 | % | $ | 37.50 | $ | 37.50 | $ | 75.00 |
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• | Review and approve the Company’s overall total compensation policy | ||
• | Review and evaluate company performance against pre-established performance metrics | ||
• | Annually, establish the annual total compensation paid to officers and key executives, including base salary, annual incentive, and long-term incentives | ||
• | Regularly review and approve all employment agreements and severance arrangements for the executive officers | ||
• | Review the Company’s Compensation Discussion and Analysis disclosure |
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Level | Typical Executive Position | Stock Ownership Goal | ||
1 | CEO | 4x Base Salary | ||
2 | SVP | 2x Base Salary | ||
3 | VP | 1x Base Salary |
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Executive Compensation Element | Action Item | |
Base Salaries | • Review and/or adjust based on market review | |
Short-Term Incentives | • Determine year-end results and approve payouts • Set goals for upcoming year | |
Long-Term Incentives: | • Determine performance results and approve long-term cash plan’s payouts • Set goals for long-term cash plan’s next three-year performance cycle • Determine and approve equity awards, including stock options and restricted stock awards |
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• | Annual base salary and compensation for earned but unused vacation time accrued through the date of termination of employment; |
• | Pro rated amount equal to the greater of the executive officer’s (i) target performance bonus for the year of the termination of employment and (ii) performance bonus for the year immediately preceding the year of the termination of employment; |
• | Lump sum severance equal to 18 months’ of the executive’s base salary for the fiscal year in which the termination occurs; |
• | Continued participation in health and welfare plans and payment of benefit premiums for 18 months; and |
• | All other perquisites to which the executive is entitled pursuant to the terms of the agreements providing for such perquisites. |
• | Base salary continuation for two years (at the rate in effect immediately preceding the date of termination), paid semi-monthly for 24 months; |
• | Pro-rated AIA bonus for the year of termination, as determined by the Board of Directors; and |
• | Continued participation in health and welfare plans and payment of benefit premiums (i.e., medical, dental, vision, life, disability and any other welfare plans he currently participates in) for 18 months. |
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• | Any person or entity acquiring or becoming beneficial owner as defined in SEC regulations of 20% or more of (i) the then outstanding shares of common stock of the Company or (ii) the combined voting power of the then outstanding voting securities of the Company; |
• | Generally, our current directors ceasing to constitute a majority of our directors; |
• | Consummation of a merger, consolidation, or recapitalization (unless the directors continue to represent a majority of the directors on the board, more than 80% of the pre-spin-off ownership survives, and, in the event of a recapitalization, no person owns 20% or more of (i) the then outstanding shares of our common stock or (ii) the combined voting power of our then outstanding voting securities); |
• | The stockholders approve a complete liquidation or dissolution of the Company; or |
• | The sale, lease or disposal of substantially all of our assets. |
• | the executive is assigned any duties inconsistent with his position; there is a change in his position, authority, duties or responsibilities; he is removed from, or not re-elected or reappointed to, any duties or position he previously held or was assigned or there is a material diminution in such position, authority, duties or responsibilities; |
• | the executive’s annual base salary is reduced; |
• | the executive’s annual bonus is reduced below a certain amount; |
• | the executive’s principal office is relocated outside of the portion of the metropolitan area of the City of Houston, Texas that is located within the highway known as “Beltway 8”; |
• | the executive’s benefits are reduced or terminated; |
• | any other non-contractual benefits that were provided to the executive or any material fringe benefit is reduced; |
• | the executive’s number of paid vacation days is reduced; |
• | the executive’s office space, related facilities and support personnel (including, but not limited to, administrative and secretarial assistance) are reduced or moved; |
• | the executive is required to perform a majority of his duties outside our principal executive offices for a period of more than 21 consecutive days or for more than 90 days in any calendar year; or |
• | any provision of any employment agreement with the executive is breached. |
• | Annual base salary and compensation for earned but unused vacation time accrued through the date of termination of employment; |
• | Pro rated amount equal to the greater of the executive officer’s (i) target performance bonus for the year of the termination of employment and (ii) performance bonus for the year immediately preceding the year of the termination of employment; |
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• | Lump sum severance equal to three times (for the Chief Executive Officer and Senior Vice Presidents) or two times (for Vice Presidents) the sum of (i) base salary for the year of termination and (ii) the greater of the executive officer’s (x) target performance bonus for the year of the termination of employment and (y) performance bonus for the year immediately preceding the year of the termination of employment; |
• | Continued health and welfare benefits for the shorter of (i) three years from the date of termination or (ii) such time as the executive becomes fully employed; and |
• | All other perquisites to which the executive is entitled pursuant to the terms of the agreements providing for such perquisites. |
• | all options to acquire common stock and all stock appreciation rights pertaining to common stock held by the executive immediately prior to a change in control would become fully exercisable; and |
• | all restrictions on any restricted common stock granted to the executive prior to the change in control would be removed and the stock would be freely transferable. |
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NQ | ||||||||||||||||||||||||||||||||||||||||
Restricted | Health & | Deferred | ||||||||||||||||||||||||||||||||||||||
Severance | Pro-rated | Options | Stock | Performance | Welfare | Comp. | Retirement | Tax Gross- | Total | |||||||||||||||||||||||||||||||
Payment | Bonus | (Unvested)(1) | (Unvested)(1) | Units | Benefits(2) | (Unvested) | (SERP)(3) | Up | Benefit | |||||||||||||||||||||||||||||||
Name | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ||||||||||||||||||||||||||||||
David D. Petratis Enhanced Retirement(4) | n/a | n/a | n/a | n/a | n/a | n/a | n/a | n/a | n/a | n/a | ||||||||||||||||||||||||||||||
Death/Disability | — | 1,400,000 | 1,657,479 | 1,434,565 | 618,333 | (5) | — | 249,807 | 4,047,522 | (6) | n/a | 9,407,706 | ||||||||||||||||||||||||||||
Involuntary w/o Cause(7) | 1,400,000 | 1,400,000 | (8) | — | — | — | 26,486 | — | — | n/a | 2,826,486 | |||||||||||||||||||||||||||||
Termination after Change in Control(9) | 4,200,000 | 700,000 | 1,657,479 | 2,489,175 | 530,000 | 107,809 | 249,807 | 1,246,620 | 2,723,332 | 13,904,222 | ||||||||||||||||||||||||||||||
Brent L. Korb Enhanced Retirement(4) | n/a | n/a | n/a | n/a | n/a | n/a | n/a | n/a | n/a | n/a | ||||||||||||||||||||||||||||||
Death/Disability | — | 509,844 | 577,705 | 660,457 | 186,667 | (5) | — | — | 738,684 | (6) | n/a | 2,673,357 | ||||||||||||||||||||||||||||
Involuntary w/o Cause(7) | 511,875 | 255,938 | — | — | — | 16,939 | — | — | n/a | 784,752 | ||||||||||||||||||||||||||||||
Termination after Change in Control(9) | 1,791,563 | 255,938 | 577,705 | 1,041,556 | 160,000 | 77,478 | — | 790,158 | 1,207,745 | 5,902,143 | ||||||||||||||||||||||||||||||
Kevin P. Delaney Enhanced Retirement(4) | n/a | n/a | n/a | n/a | n/a | n/a | n/a | n/a | n/a | n/a | ||||||||||||||||||||||||||||||
Death/Disability | — | 431,005 | 505,839 | 663,262 | 156,667 | (5) | — | — | 719,797 | (6) | n/a | 2,476,570 | ||||||||||||||||||||||||||||
Involuntary w/o Cause(7) | 431,883 | 215,942 | — | — | — | 27,202 | — | — | n/a | 675,027 | ||||||||||||||||||||||||||||||
Termination after Change in Control(9) | 1,511,591 | 215,942 | 505,839 | 955,006 | 133,333 | 80,282 | — | 1,097,580 | — | 4,499,573 | ||||||||||||||||||||||||||||||
Deborah M. Gadin(10) Enhanced Retirement(4) | n/a | n/a | n/a | n/a | n/a | n/a | n/a | n/a | n/a | n/a | ||||||||||||||||||||||||||||||
Death/Disability | — | 148,124 | 125,854 | 158,569 | 35,000 | (5) | — | 3,607 | n/a | n/a | 471,154 | |||||||||||||||||||||||||||||
Involuntary w/o Cause | — | — | — | — | — | — | — | — | n/a | — | ||||||||||||||||||||||||||||||
Termination after Change in Control(9) | 519,697 | 74,242 | 125,854 | 234,260 | 30,000 | 64,494 | 3,607 | n/a | 245,176 | 1,297,330 | ||||||||||||||||||||||||||||||
Jairaj T. Chetnani(10) Enhanced Retirement(4) | n/a | n/a | n/a | n/a | n/a | n/a | n/a | n/a | n/a | n/a | ||||||||||||||||||||||||||||||
Death/Disability | — | 163,667 | 258,585 | 109,170 | 46,667 | (5) | — | — | n/a | n/a | 578,089 | |||||||||||||||||||||||||||||
Involuntary w/o Cause | — | — | — | — | — | — | — | — | n/a | — | ||||||||||||||||||||||||||||||
Termination after Change in Control(9) | 574,000 | 82,000 | 258,585 | 192,634 | 40,000 | 56,876 | — | n/a | 248,753 | 1,452,848 |
(1) | Unvested stock options and restricted shares granted under the Quanex Building Products 2008 Omnibus Incentive Plan are forfeited except upon death, Disability, retirement (options only) or termination after a Change in Control. | |
(2) | Health & Welfare Benefits paid upon involuntary termination without Cause include company paid COBRA premiums. Health & Welfare Benefits paid upon termination after Change in Control includes continuation of all health & welfare benefits. |
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(3) | See Narrative to “Pension Benefit Table” for further description of SERP. | |
(4) | Messrs. Petratis, Korb, Delaney, Chetnani and Ms. Gadin have not reached the minimum retirement requirement of 55 years of age and five years of service with the Company as of October 31, 2010. | |
(5) | Executives are entitled to a prorata portion of their performance units based on actual performance for the full performance period upon their termination due to death or Disability. Since actual performance for the full performance period is unknown, actual performance through October 31, 2010 was used for purposes of these calculations. | |
(6) | These amounts represent the present value of the Retirement Benefit as of October 31, 2010. Retirement Benefit amounts for Messrs. Petratis, Korb and Delaney under the SERP are in the event of Disability only. | |
(7) | These benefits would be provided upon termination by the Company without Cause. | |
(8) | Mr. Petratis’ prorata bonus paid upon involuntary termination without Cause absent a Change in Control is determined by the Board of Directors pursuant to his Offer Letter. We assumed the Board of Directors would award Mr. Petratis with his actual 2010 bonus if he was terminated on the last day of the fiscal year. | |
(9) | These benefits would be provided upon termination by the Company without Cause as well as the Executives’ resignation for Good Reason in connection with a Change in Control. | |
(10) | Ms. Gadin and Mr. Chetnani do not have Severance Agreements. However, they could be entitled to severance benefits under the Quanex Severance Allowance Policy which is generally available to all employees. |
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Change in | ||||||||||||||||||||||||||||||||||||
Pension Value | ||||||||||||||||||||||||||||||||||||
and | All | |||||||||||||||||||||||||||||||||||
Non-Equity | Nonqualified | Other | ||||||||||||||||||||||||||||||||||
Stock | Option | Incentive Plan | Deferred | Compen- | ||||||||||||||||||||||||||||||||
Bonus | Awards | Awards | Compensation | Compensation | sation | |||||||||||||||||||||||||||||||
Salary | (2) | (3) | (3) | (4) | Earnings (5) | (6) | Total | |||||||||||||||||||||||||||||
Name/Principal Position | Year (1) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | |||||||||||||||||||||||||||
David D. Petratis | 2010 | 700,000 | — | 565,729 | 881,814 | 1,400,000 | 277,246 | 69,780 | 3,894,569 | |||||||||||||||||||||||||||
Chairman of the Board, | 2009 | 700,000 | — | 429,867 | 604,069 | 390,613 | 243,256 | 64,938 | 2,432,743 | |||||||||||||||||||||||||||
President and Chief | 2008 QBP | 233,333 | 750,000 | 1,010,750 | 551,550 | 500,000 | 47,114 | 225,093 | 3,317,840 | |||||||||||||||||||||||||||
Executive Officer | 2008 Pred | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Brent L. Korb | 2010 | 339,896 | — | 175,068 | 273,064 | 509,844 | 57,751 | 32,620 | 1,388,243 | |||||||||||||||||||||||||||
Senior Vice President — | 2009 | 325,000 | — | 133,110 | 187,032 | 136,017 | 104,726 | 27,753 | 913,638 | |||||||||||||||||||||||||||
Finance & Chief | 2008 QBP | 109,686 | — | 670,946 | 847,975 | 41,941 | 22,833 | 28,604 | 1,721,985 | |||||||||||||||||||||||||||
Financial Officer | 2008 Pred | 82,568 | — | — | — | 116,509 | — | 5,438 | 204,515 | |||||||||||||||||||||||||||
Kevin P. Delaney | 2010 | 287,337 | — | 150,753 | 235,927 | 431,005 | 115,531 | 43,327 | 1,263,880 | |||||||||||||||||||||||||||
Senior Vice President — | 2009 | 271,625 | — | 108,054 | 152,531 | 113,679 | 194,388 | 36,243 | 876,520 | |||||||||||||||||||||||||||
General Counsel & | 2008 QBP | 138,447 | — | 449,053 | 549,618 | 52,939 | — | 24,186 | 1,214,243 | |||||||||||||||||||||||||||
Secretary | 2008 Pred | 116,932 | — | — | — | 359,937 | — | 8,809 | 485,678 | |||||||||||||||||||||||||||
Jairaj T. Chetnani | 2010 | 204,583 | — | 37,283 | 58,982 | 163,667 | 7,292 | 20,820 | 492,627 | |||||||||||||||||||||||||||
Vice President — | 2009 | 183,333 | — | 64,099 | 103,833 | 40,921 | 6,245 | 152,708 | 551,139 | |||||||||||||||||||||||||||
Treasurer | 2008 QBP | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
2008 Pred | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||
Deborah M. Gadin | 2010 | 185,155 | — | 34,041 | 53,156 | 148,124 | 17,634 | 23,819 | 461,929 | |||||||||||||||||||||||||||
Vice President — | 2009 | 174,250 | — | 24,273 | 34,198 | 38,894 | 20,165 | 16,876 | 308,656 | |||||||||||||||||||||||||||
Controller | 2008 QBP | 88,496 | 60,000 | 127,296 | 314,773 | 18,047 | — | 6,809 | 615,421 | |||||||||||||||||||||||||||
2008 Pred | 62,045 | — | — | — | 29,726 | — | 1,912 | 93,683 |
(1) | Quanex Building Products Corporation spun off from Quanex Corporation on April 23, 2008. Compensation for the named executive officers for the period from November 1, 2007 to April 22, 2008 relates to Quanex Corporation, the Company’s predecessor, and is denoted as “2008 Pred”. Compensation in 2008 from Quanex Corporation reflects some non-equity incentive plan compensation items specifically resulting from the spin-off transaction. Compensation for the named executive officers for the period from April 23, 2008 to October 31, 2008 relates to Quanex Building Products Corporation and is denoted as “2008 QBP”. Compensation for 2009 and 2010 relates to Quanex Building Products Corporation. | |
(2) | As an inducement to join the Company, Mr. Petratis was provided with certain sign-on incentives as of his hire date, July 1, 2008. One of said items was a “Make Whole” cash compensation of $750,000 for forfeited equity awards at his previous employer. Ms. Gadin received a retention bonus of $60,000 in 2008 as an incentive to retain her services during the strategic review process that resulted in the Company’s spin-off from Quanex Corporation. | |
(3) | These columns show respectively, the aggregate grant date fair value for restricted stock and stock options computed in accordance with FASB ASC Topic 718. A discussion of the assumptions used in computing the grant date fair values may be found in Note 14 to Quanex Building Products Corporation’s audited financial statements on Form 10-K for the year ended October 31, 2010. These values reflect the Company’s assumptions to determine the accounting expense for these awards and do not necessarily correspond to the actual value that may be recognized by named executive officers. For information regarding the restricted stock and option awards granted in fiscal 2010, please see the “Grants of Plan-Based Awards” table located on page 44. |
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Included in Mr. Korb’s 2008 QBP stock and option award amounts are $211,346 and $307,015, respectively, of grant date fair value that were forfeited in connection with Mr. Korb’s departure from the Company on June 13, 2008. | ||
(4) | “2010” amounts represent payments made in December 2010 for performance from November 1, 2009 to October 31, 2010 for Annual Incentive Awards (AIA). “2009” amounts represent payments made in December 2009 for performance from November 1, 2008 to October 31, 2009 for Annual Incentive Awards (AIA). “2008 QBP” amounts represent payments made in December 2008 for performance from April 23, 2008 to October 31, 2008 for AIA. “2008 Pred” amounts consist of (a) AIA payments made in April 2008 for goals from November 1, 2008 to April 23, 2008, and (b) amounts paid out in April 2008 with respect to Performance Units granted in December 2005 and December 2006. These Performance Units were paid out in cash at target level pursuant to the Quanex Corporation / Quanex Building Products separation related agreements. | |
The AIA and Performance Unit payouts also include the dollar value of the portion of the amounts deferred under the Quanex Building Products Corporation or Quanex Corporation Deferred Compensation (“DC”) Plan, as applicable. Under the terms of each DC Plan, participants may elect to defer a portion of their incentive bonus to a mix of cash, or notional common stock units or investment accounts. |
Annual Incentive Awards | Performance Unit Payout | |||||||||||||||||||
Total | Deferred | Total | Deferred | |||||||||||||||||
Name | Year | ($) | ($) | ($) | ($) | |||||||||||||||
Petratis | 2010 | 1,400,000 | 700,000 | — | — | |||||||||||||||
2009 | 390,613 | — | — | — | ||||||||||||||||
2008 QBP | 500,000 | 500,000 | — | — | ||||||||||||||||
2008 Pred | — | — | — | — | ||||||||||||||||
Korb | 2010 | 509,844 | — | — | — | |||||||||||||||
2009 | 136,017 | — | — | — | ||||||||||||||||
2008 QBP | 41,941 | — | — | — | ||||||||||||||||
2008 Pred | 66,509 | — | 50,000 | — | ||||||||||||||||
Delaney | 2010 | 431,005 | — | — | — | |||||||||||||||
2009 | 113,679 | — | — | — | ||||||||||||||||
2008 QBP | 52,939 | — | — | — | ||||||||||||||||
2008 Pred | 176,604 | — | 183,333 | — | ||||||||||||||||
Chetnani | 2010 | 163,667 | — | — | — | |||||||||||||||
2009 | 40,921 | 40,921 | — | — | ||||||||||||||||
2008 QBP | — | — | — | — | ||||||||||||||||
2008 Pred | — | — | — | — | ||||||||||||||||
Gadin | 2010 | 148,124 | 29,625 | — | — | |||||||||||||||
2009 | 38,894 | — | — | — | ||||||||||||||||
2008 QBP | 18,047 | 7,219 | — | — | ||||||||||||||||
2008 Pred | 29,726 | — | — | — |
Amounts reflected above as “2010”, “2009” and “2008 QBP” were deferred under the Quanex Building Products Corporation DC Plan, while the amounts reflected as “2008 Pred” were deferred under the Quanex Corporation DC Plan. Please see the “Compensation Discussion and Analysis” for a detailed discussion of the performance measures and related outcomes for payments of the awards. |
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(5) | The amounts in this column represent the change in actuarial present value of each individual’s accumulated benefit under all defined benefit pension plans. The change in pension value reflects the difference in the present value of accumulated benefits determined as of the end of the current reporting period compared to the end of the previous reporting period. For instance the change for fiscal 2010 would represent the difference between the value at October 31, 2010 and October 31, 2009. The key assumptions used to calculate the change in value are shown with the “Pension Benefits Table”. Negative changes in pension value for a fiscal year cannot be included in the Summary Compensation Table. Changes in pension value for certain individuals were negative for fiscal 2008; these negative amounts are follows: |
Change in Pension Value | ||||||||
and Nonqualified Deferred | ||||||||
Compensation Earnings | ||||||||
Name | Year | ($) | ||||||
Delaney | 2008 QBP | (2,714 | ) | |||||
2008 Pred | (2,487 | ) | ||||||
Gadin | 2008 QBP | (792 | ) | |||||
2008 Pred | (726 | ) |
No named executive officer received preferential or above-market earnings on deferred compensation. | ||
(6) | The named executives receive various perquisites provided by or paid for by the Company. These perquisites can include life insurance, financial planning, personal use of automobiles, memberships in social and professional clubs, relocation reimbursement and gross-up payments equal to taxes payable on certain perquisites. Also included are the Company’s contributions under its 401(k) plan, a 20% match under its DC plan, a 15% match under its Employee Stock Purchase Program (ESPP), and dividends on unvested restricted stock. The Company temporarily suspended its matching contributions on its 401(k) plan, DC plan and under its ESPP effective April 1, 2009; however, the Board reinstated matching contributions on the 401(k) plan and ESPP effective February 1, 2010. In 2009, the Compensation Committee eliminated the tax gross-up payments on perquisites, effective December 31, 2009. The amounts reported in Other Annual Compensation for the named executives are: |
Life | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Insurance | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
> $50,000 | Relo- | Settle- | Deferred | Unvested | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Annual | & | cation | ment of | Compen- | ESPP | Re- | ||||||||||||||||||||||||||||||||||||||||||||||||||
Life | Club | Financial | Tax | Unused | sation | 15% | stricted | |||||||||||||||||||||||||||||||||||||||||||||||||
Insurance | Financial | Auto- | Member- | Planning | Relo- | Gross- | Vaca- | 401K | Plan | Stock | Stock | |||||||||||||||||||||||||||||||||||||||||||||
> $50,000 | Planning | mobile | ship | Gross-Up | cation | Up | tion | Match | Match | Match | Dividends | Total | ||||||||||||||||||||||||||||||||||||||||||||
Year | ($) | ($) | ($) | ($) | ($)(1) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | |||||||||||||||||||||||||||||||||||||||||||
Petratis | 2010 | 12,249 | 7,699 | 9,282 | 14,721 | — | — | — | — | 4,667 | — | 990 | 20,172 | 69,780 | ||||||||||||||||||||||||||||||||||||||||||
2009 | 12,319 | 10,000 | — | 10,820 | 12,801 | 135 | 81 | — | 4,375 | — | 270 | 14,137 | 64,938 | |||||||||||||||||||||||||||||||||||||||||||
2008 QBP | 5,727 | 650 | — | 1,800 | 3,658 | 69,230 | 41,538 | — | — | 100,000 | 540 | 1,950 | 225,093 | |||||||||||||||||||||||||||||||||||||||||||
2008 Pred | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Korb | 2010 | 1,887 | 600 | 11,706 | 4,921 | — | — | — | — | 5,414 | — | — | 8,092 | 32,620 | ||||||||||||||||||||||||||||||||||||||||||
2009 | 1,884 | 600 | 11,607 | 4,567 | 1,425 | — | — | — | 2,031 | — | — | 5,639 | 27,753 | |||||||||||||||||||||||||||||||||||||||||||
2008 QBP | 1,547 | 600 | 9,755 | 1,132 | 1,231 | — | — | 11,877 | 1,494 | — | 68 | 900 | 28,604 | |||||||||||||||||||||||||||||||||||||||||||
2008 Pred | — | — | — | — | — | — | — | — | 4,256 | — | 90 | 1,092 | 5,438 | |||||||||||||||||||||||||||||||||||||||||||
Delaney | 2010 | 4,983 | 7,500 | 12,809 | 5,090 | — | — | — | — | 5,525 | — | — | 7,420 | 43,327 | ||||||||||||||||||||||||||||||||||||||||||
2009 | 4,573 | 2,895 | 12,642 | 4,950 | 4,283 | — | — | — | 1,656 | — | — | 5,244 | 36,243 | |||||||||||||||||||||||||||||||||||||||||||
2008 QBP | 3,218 | 1,699 | 11,357 | 3,298 | 2,820 | — | — | — | — | — | — | 1,794 | 24,186 | |||||||||||||||||||||||||||||||||||||||||||
2008 Pred | — | — | — | 1,295 | — | — | — | — | 5,750 | — | — | 1,764 | 8,809 | |||||||||||||||||||||||||||||||||||||||||||
Chetnani | 2010 | 451 | — | 10,244 | 2,930 | — | — | — | — | 5,698 | — | — | 1,497 | 20,820 | ||||||||||||||||||||||||||||||||||||||||||
2009 | 506 | 2,000 | 9,929 | 1,692 | 1,325 | 88,074 | 46,924 | — | 1,250 | — | — | 1,008 | 152,708 | |||||||||||||||||||||||||||||||||||||||||||
2008 QBP | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
2008 Pred | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Gadin | 2010 | 418 | — | 10,622 | 4,921 | — | — | — | — | 5,738 | — | 300 | 1,820 | 23,819 | ||||||||||||||||||||||||||||||||||||||||||
2009 | 388 | — | 10,712 | 3,112 | 204 | — | — | — | 1,062 | — | 90 | 1,308 | 16,876 | |||||||||||||||||||||||||||||||||||||||||||
2008 QBP | 507 | — | — | — | 152 | — | — | — | 3,997 | 1,444 | 240 | 469 | 6,809 | |||||||||||||||||||||||||||||||||||||||||||
2008 Pred | 99 | — | — | — | — | — | — | — | 1,753 | — | 60 | — | 1,912 |
(1) | The Compensation Committee eliminated the tax gross-up payments on perquisites, effective December 31, 2009. |
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All Other | All Other | |||||||||||||||||||||||||||||||||||||||
Stock | Option | |||||||||||||||||||||||||||||||||||||||
Awards: | Awards: | Exercise | ||||||||||||||||||||||||||||||||||||||
Number of | Number of | or Base | Grant Date | Grant Date | ||||||||||||||||||||||||||||||||||||
Non-Equity | Estimated Future Payouts Under Non- | Shares of | Securities | Price of | Fair Value | Fair Value | ||||||||||||||||||||||||||||||||||
Incentive Plan | Equity Incentive Plan Awards(2) | Stock or | Underlying | Option | of Stock | of Option | ||||||||||||||||||||||||||||||||||
Awards(1) | Threshold | Target | Maximum | Units(3) | Options(3) | Awards | Awards(4) (5) | Awards(4) | ||||||||||||||||||||||||||||||||
Name | Grant Date | (#) | ($) | ($) | ($) | (#) | (#) | ($/Sh) | ($) | ($) | ||||||||||||||||||||||||||||||
Petratis | 2010 | 572,500 | 1,230,000 | 2,460,000 | — | — | — | — | — | |||||||||||||||||||||||||||||||
12/2/2009 | 5,300 | — | — | — | 34,900 | 121,100 | $ | 16.21 | 565,729 | 881,814 | ||||||||||||||||||||||||||||||
Korb | 2010 | 183,731 | 414,922 | 829,844 | — | — | — | — | — | |||||||||||||||||||||||||||||||
12/2/2009 | 1,600 | — | — | — | 10,800 | 37,500 | $ | 16.21 | 175,068 | 273,064 | ||||||||||||||||||||||||||||||
Delaney | 2010 | 158,876 | 355,503 | 711,006 | — | — | — | — | — | |||||||||||||||||||||||||||||||
12/2/2009 | 1,400 | — | — | — | 9,300 | 32,400 | $ | 16.21 | 150,753 | 235,927 | ||||||||||||||||||||||||||||||
Chetnani | 2010 | 50,458 | 121,833 | 243,666 | — | — | — | — | — | |||||||||||||||||||||||||||||||
12/2/2009 | 400 | — | — | — | 2,300 | 8,100 | $ | 16.21 | 37,283 | 58,982 | ||||||||||||||||||||||||||||||
Gadin | 2010 | 41,016 | 104,062 | 208,125 | — | — | — | — | — | |||||||||||||||||||||||||||||||
12/2/2009 | 300 | — | — | — | 2,100 | 7,300 | $ | 16.21 | 34,041 | 53,156 |
(1) | The figures shown reflect Performance Units granted in December 2009 under the Quanex Building Products Corporation 2008 Omnibus Incentive Plan. | |
(2) | The amounts shown reflect possible Annual Incentive Award (AIA) payments under the Quanex Building Products Corporation 2008 Omnibus Incentive Plan for fiscal year 2010, under which the named executive officers were eligible to receive a cash bonus based on a target percentage of base salary. Additionally, these amounts reflect possible Performance Unit payments under the Quanex Building Products Corporation 2008 Omnibus Incentive Plan for Performance Units granted in December 2009 under which the named executive officers are eligible to receive a cash payment three years from the grant date or in December 2012. The amounts actually paid to the named executive officers for 2010 pursuant to this program are reflected in the “Summary Compensation Table” herein. | |
The following table shows the range of return on invested capital ROIC goals set for determining AIA to our executives for the period from for fiscal 2010. Because of the economic downturn in the market, our ROIC targets were set at levels considered to be stretch goals, even though they were below historic levels. The Company set the ROIC goal based on the forecasted results of the operating divisions and the projected market for building products. For AIA purposes, ROIC is calculated as the total of the prior twelve months’ net income plus prior twelve months’ after-tax interest expense and capitalized interest, the sum of which is divided by the trailing five quarters’ average total debt (current and long term) and total stockholders’ equity. We set the target performance goals at a level that represents a reasonable chance of achievement based on the forecasted performance of the divisions. The target performance level is driven from our business budgeting process, which uses a number of assumptions about the state of our markets and material commodity prices to determine our relative financial performance (including expected sales, expected expenses and other factors). We recognize the volatility in the market through establishing a range of outcomes around the target. |
Goal | Threshold | Target | Maximum | Actual Results | ||||||||||||
Return on Invested Capital (ROIC) | 0.56 | % | 2.55 | % | 4.16 | % | 5.83 | % |
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We also adopted a growth modifier based on relative market share gain for our AIA. Depending on the relative change in the Engineered Products Group revenue vs. the change in market New Housing Starts and Repair and Remodeling expenditures, the bonus payments could be adjusted within a range of +/- 25% depending on the level of outperformance/underperformance to the underlying market. This growth modifier was intended to balance growth and returns, and reward for market share expansion. The growth modifier cannot increase AIA awards above a participant’s existing maximum award opportunity. | ||
Please see the “Compensation Discussion and Analysis” for more information regarding this program, performance units granted thereunder, and the related performance measures. | ||
(3) | The amounts shown reflect grants of restricted stock awards and stock options made under the Quanex Building Products Corporation 2008 Omnibus Incentive Plan. The stock options are granted at fair market value based on the closing share price as of the grant date. | |
(4) | The fair value shown in this column was calculated in accordance with FASB ASC Topic 718. A discussion of the assumptions used in calculating these values may be found in Note 14 to Quanex Building Products Corporation’s audited financial statements on Form 10-K for the year ended October 31, 2010. | |
(5) | Cash dividends are paid on unvested restricted stock. The dividend rate is not preferential and is equal to the rate paid on the Company’s common stock as disclosed in Part II, Item 5 of Quanex Building Products Corporation’s Form 10-K for the year ended October 31, 2010. |
Option Awards | Stock Awards | |||||||||||||||||||||||
Number of | Number of | |||||||||||||||||||||||
Securities | Securities | Market Value | ||||||||||||||||||||||
Underlying | Underlying | Number of Shares | of Shares or | |||||||||||||||||||||
Unexercised | Unexercised | Option | or Units of Stock | Units of Stock | ||||||||||||||||||||
Options | Options | Exercise | Option | That Have Not | That Have | |||||||||||||||||||
(#) | (#) | Price | Expiration | Vested | Not Vested(15) | |||||||||||||||||||
Name | Exercisable | Unexercisable | ($) | Date | (#) | ($) | ||||||||||||||||||
Petratis | — | 121,100 | (1) | 16.21 | 12/2/2019 | 34,900 | (8) | 628,898 | ||||||||||||||||
66,533 | 133,067 | (2) | 7.83 | 12/3/2018 | 54,900 | (9) | 989,298 | |||||||||||||||||
66,666 | 33,334 | (3) | 15.55 | 7/1/2018 | 48,334 | (10) | 870,979 | |||||||||||||||||
Korb | — | 37,500 | (1) | 16.21 | 12/2/2019 | 10,800 | (8) | 194,616 | ||||||||||||||||
20,600 | 41,200 | (2) | 7.83 | 12/3/2018 | 17,000 | (9) | 306,340 | |||||||||||||||||
66,666 | 33,334 | (4) | 15.32 | 8/1/2018 | 30,000 | (11) | 540,600 | |||||||||||||||||
Delaney | — | 32,400 | (1) | 16.21 | 12/2/2019 | 9,300 | (8) | 167,586 | ||||||||||||||||
16,800 | 33,600 | (2) | 7.83 | 12/3/2018 | 13,800 | (9) | 248,676 | |||||||||||||||||
69,872 | 34,937 | (5) | 15.02 | 4/23/2018 | 29,897 | (12) | 538,744 | |||||||||||||||||
Chetnani | — | 8,100 | (1) | 16.21 | 12/2/2019 | 2,300 | (8) | 41,446 | ||||||||||||||||
4,433 | 8,867 | (2) | 7.83 | 12/3/2018 | 3,700 | (9) | 66,674 | |||||||||||||||||
7,291 | 14,584 | (6) | 7.49 | 12/1/2018 | 4,690 | (13) | 84,514 | |||||||||||||||||
Gadin | — | 7,300 | (1) | 16.21 | 12/2/2019 | 2,100 | (8) | 37,842 | ||||||||||||||||
3,766 | 7,534 | (2) | 7.83 | 12/3/2018 | 3,100 | (9) | 55,862 | |||||||||||||||||
28,666 | 14,334 | (7) | 16.32 | 6/16/2018 | 7,800 | (14) | 140,556 | |||||||||||||||||
7,666 | 3,834 | (5) | 15.02 | 4/23/2018 | — | — |
(1) | Ms. Gadin and Messrs. Petratis, Korb, Delaney and Chetnani’s stock options vest annually in equal installments over a three-year period. One-third of the stock options vested on December 2, 2010 with the remaining two-thirds vesting in equal installments on December 2, 2011 and December 2, 2012. | |
(2) | Ms. Gadin and Messrs. Petratis, Korb, Delaney and Chetnani’s stock options vest annually in equal installments over a three-year period. Two-thirds of the stock options vested in equal installments on December 3, 2009 and December 3, 2010, with the remaining one-third vesting on December 3, 2011. |
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(3) | Mr. Petratis’ stock options vest annually in equal installments over a three-year period. Two-thirds of the stock options vested in equal installments on July 1, 2009 and July 1, 2010 with the remaining one-third on July 1, 2011. | |
(4) | Mr. Korb’s stock options vest annually in equal installments over a three-year period. Two-thirds of the stock options vested in equal installments on August 1, 2009 and August 1, 2010 with the remaining one-third vesting on August 1, 2011. | |
(5) | Ms. Gadin and Mr. Delaney’s stock options vest annually in equal installments over a three-year period. Two-thirds of the stock options vested in equal installments on April 23, 2009 and April 23, 2010 with the remaining one-third vesting on April 23, 2011. | |
(6) | Mr. Chetnani’s stock options vest annually in equal installments over a three-year period. Two-thirds of the stock options vested in equal installments on December 1, 2009 and December 1, 2010 with the remaining one-third vesting on December 1, 2011. | |
(7) | Ms. Gadin’s stock options vest annually in equal installments over a three-year period. Two-thirds of the stock options vested in equal installments on June 16, 2009 and June 16, 2010 with the remaining one-third vesting on June 16, 2011. | |
(8) | Ms. Gadin and Messrs. Petratis, Korb, Delaney and Chetnani’s restricted stock awards fully vest on December 2, 2012, three years from the date of grant. | |
(9) | Ms. Gadin and Messrs. Petratis, Korb, Delaney and Chetnani’s restricted stock awards fully vest on December 3, 2011, three years from the date of grant. | |
(10) | 40,000 of these restricted stock awards fully vest on July 1, 2011, three years from the date of grant. The remaining 16,667 restricted stock awards vest annually in equal installments over two years; accordingly one-half of the restricted shares vested on July 1, 2010 and the remaining will vest on July 1, 2011. | |
(11) | Mr. Korb’s restricted stock awards fully vest on August 1, 2011, three years from the date of grant. | |
(12) | Mr. Delaney’s restricted stock awards fully vest on April 23, 2011, three years from the date of grant. | |
(13) | Mr. Chetnani’s restricted stock awards fully vest on December 1, 2011, three years from the date of grant. | |
(14) | Ms. Gadin’s restricted stock awards fully vest on June 16, 2011, three years from the date of grant. | |
(15) | This column shows the total market value of the unvested stock awards as of October 31, 2010, based on the closing price per share of Quanex Building Products Corporation’s stock of $18.02 on October 31, 2010. |
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Option Awards | Stock Awards | |||||||||||||||
Number of | Number of | |||||||||||||||
Shares | Shares | |||||||||||||||
Acquired on | Value Realized | Acquired on | Value Realized | |||||||||||||
Exercise | on Exercise | Vesting | on Vesting(1) | |||||||||||||
Name | (#) | ($) | (#) | ($) | ||||||||||||
Petratis | — | — | 8,333 | 144,411 | ||||||||||||
Korb | — | — | — | — | ||||||||||||
Delaney | — | — | — | — | ||||||||||||
Chetnani | — | — | — | — | ||||||||||||
Gadin | — | — | — | — |
(1) | The value realized upon vesting represents the number of shares of stock vesting times closing market price of a share of Quanex Building Products Corporation stock on the vesting date. |
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• | 2.75% of the highest consecutive 36-month average of salary and bonus compensation from the last 60 months of employment, |
• | multiplied by the named executive officer’s years of service (but not in excess of 20 years), and |
• | reduced by (i) any benefits payable under the Pension Plan and (ii) 50% of the named executive officer’s Social Security benefits adjusted pro rata for years of service not in excess of 20 years. |
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• | the benefit payable to the named executive officer under the Pension Plan if the compensation taken into account under that plan were not capped at the amount required under Section 401(a)(17) of the Internal Revenue Code, |
• | reduced by the benefit payable to the named executive officer under the Pension Plan taking into account only the amount of compensation allowed under Section 401(a)(17) of the Internal Revenue Code. |
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Number of | Payments | |||||||||||||
Years | During | |||||||||||||
Credited | Present Value of | Last Fiscal | ||||||||||||
Service | Accumulated Benefit | Year | ||||||||||||
Name | Plan Name | (#) | ($) | ($) | ||||||||||
David D. Petratis | SERP(1) | 2.33 | 541,370 | — | ||||||||||
Pension Plan(2) | 2.33 | 26,246 | — | |||||||||||
Brent L. Korb | SERP(1) | 6.94 | 146,711 | — | ||||||||||
Pension Plan(2) | 6.94 | 55,133 | — | |||||||||||
Kevin P. Delaney | SERP(1) | 7.28 | 374,954 | — | ||||||||||
Pension Plan(2) | 7.28 | 111,875 | — | |||||||||||
Jairaj T. Chetnani | Restoration Plan(3) | 1.92 | — | — | ||||||||||
Pension Plan(2) | 1.92 | 13,537 | — | |||||||||||
Deborah M. Gadin | Restoration Plan(3) | 5.22 | 1,523 | — | ||||||||||
Pension Plan(2) | 5.22 | 45,006 | — |
(1) | The SERP provides retirement benefits for certain designated officers in addition to those provided under the Pension Plan. The purpose of the SERP is to supplement those retirement benefits that a Participant may be entitled to receive as a salaried employee of the Company. The SERP pays a retirement benefit to eligible employees following retirement or termination of employment. As noted above, the benefit formula under the SERP equals: 2.75 percent of Final Average Earnings (defined as the highest 36 months of compensation during the last 60 months preceding retirement or termination) multiplied by Years of Service (not in excess of 20 years), less the sum of (1) the Participant’s Pension Plan Benefit, and (2) one-half of the Participant’s Social Security Benefit multiplied by a fraction (which shall not exceed one) the numerator of which is the Participant’s number of years of Service and the denominator of which is 20. The definition of “compensation” under the SERP includes W-2 wages modified by excluding reimbursements or other expense allowances, fringe benefits (cash and noncash), moving expenses, deferred compensation, welfare benefits, BeneFlex dollars under the Company’s Medical Reimbursement Plan, and restricted stock awards and stock options; and modified further by including elective contributions under a cafeteria plan maintained by the Company that is governed by section 125 of the Code and elective contributions to any plan maintained by the Company that contains a qualified cash or deferred arrangement under section 401(k) of the Code. | |
Vesting in the SERP is based on 5 Years of Service. Early Retirement under the SERP requires a Participant to attain age 55 with 5 Years of Service. If the Participant retires prior to age 55, the accrued benefit is reduced 5% for each year (and fractional year) that the Participant’s benefit commencement precedes age 65. | ||
Benefits under the SERP are paid under the following options: |
• | Single Life Annuity |
• | 50%, 75%, or 100% Joint & Survivor Annuity |
• | 10 Year Certain and Life |
• | Single Lump Sum |
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The SERP also pays a death benefit to the designated beneficiary if the Participant has retired or terminated employment, but has not commenced payment. In addition, the SERP pays a Disability Benefit. Should a Participant with six months of service terminate due to disability prior to early retirement, the SERP will pay a Disability Benefit until age 65 equal to 50 percent of the sum of his monthly Earnings in effect at the date of his Disability and the monthly equivalent of the average of his Incentive Awards for the prior three Plan Years, less the sum of (1) the Participant’s Qualified Plan Benefit; (2) the Participant’s Social Security Benefit; (3) the Participant’s benefit under the Company’s group long-term disability insurance plan; (4) the Participant’s benefit under an individual disability policy provided by the Company; and (5) the Participant’s benefit under the Company’s wage continuation policy plan. Benefits payable from the Plan are equal to the actuarial equivalent of the accrued benefit at date of distribution employing the Actuarial Equivalent definition from the Pension Plan. The Company has no policy for granting additional service under this plan. | ||
(2) | The Pension Plan was established to provide retirement income to the Company’s non-union employees. It is an ERISA qualified pension plan. The Pension Plan pays a retirement benefit to eligible Participants equal to 1.5% of the Traditional Member’s Average Monthly Compensation (high 5 consecutive years of Earnings out of the 10 years preceding termination or retirement) times years and fractional years of Benefit Service earned prior to November 1, 1985 plus the sum of 1% of Average Monthly Compensation up to Social Security Covered Compensation and 1.5% of the Traditional Member’s Average Monthly Compensation in excess of Social Security Covered Compensation, the total of which is multiplied by years and fractional years of Benefit Service from, on and after November 1, 1985. Compensation is defined as earned income excluding deferred compensation. Compensation is limited by the compensation limits imposed under the Internal Revenue Code. For Cash Balance Participants, the Pension Plan pays the Account Balance with interest at date of termination. The contribution equals a certain percentage based on location, credited with interest. The Pension Plan pays a Death Benefit prior to retirement to the spouse, or to the estate, if no spouse. The Pension Plan does not provide for a Disability Retirement. The Pension Plan requires 5 Years of Vesting Service for Traditional Plan Participants and 3 Years of Service for Cash Balance Participants. Early Retirement under the Plan requires a Participant to have attained age 55 with 5 Years of Service. None of the named executive officers is currently eligible for an early retirement benefit under this plan. Benefits commencing prior to age 65 are reduced 5/9ths of 1% for each of the first 60 months, and an additional 5/18ths of 1% for each month in excess of 60 that benefits commence prior to age 65. The Company has no policy for granting additional service under this plan. | |
(3) | The Restoration Plan was established to provide a retirement pay supplement for a select group of management or highly compensated employees so as to retain their loyalty and to offer a further incentive to them to maintain and increase their standard of performance. The Restoration Plan pays a retirement benefit in the form of a lump sum to eligible employees following retirement or termination of employment. If a Participant terminates employment, an Actuarial Equivalent lump sum of the Participant’s Pension Plan Benefit that would be payable if the applicable limitation under section 401(a)(17) of the Code for each fiscal year of the Pension Plan commencing on or after November 1, 1994, was not limited (indexed for increases in the cost of living), less the Participant’s Pension Plan Benefit. Early Retirement under the Restoration Plan requires a Participant to have attained age 55 with 5 Years of Service. None of the named executive officers is currently eligible for an early retirement benefit under this plan. The Restoration Plan requires 5 Years of Service for vesting purposes for Traditional Plan Participants, and three years of Service requirement for Cash Balance Participants. In addition, the Plan also pays a death benefit to the designated beneficiary if the Participant has retired or terminated employment, but has not commenced payment. The Restoration Plan does not provide a Disability Benefit. The Company has no policy for granting additional service under this plan. |
Executive | Registrant | Aggregate | Aggregate | Aggregate | ||||||||||||||||
Contributions | Contributions | Earnings in | Withdrawals/ | Balance at | ||||||||||||||||
FY 2010(1) | in FY 2010(2) | FY 2010(3) | Distributions | 10/31/2010(4) | ||||||||||||||||
Name | ($) | ($) | ($) | ($) | ($) | |||||||||||||||
David D. Petratis | — | — | 272,112 | — | 1,498,844 | |||||||||||||||
Brent L. Korb | — | — | — | — | — | |||||||||||||||
Kevin P. Delaney | — | — | — | — | — | |||||||||||||||
Jairaj T. Chetnani | 40,921 | — | 6,284 | — | 47,205 | |||||||||||||||
Deborah M. Gadin | — | — | 13,349 | — | 84,609 |
(1) | Executive contributions are incentive compensation earned for performance from November 1, 2008 to October 31, 2009 and deferred in December 2009, when they would have otherwise been paid, during fiscal 2010. The full amount shown in the executive contributions column for each executive was reported in the Summary Compensation Table. | |
(2) | The registrant contributions in previous years were the associated match by Quanex Building Products Corporation for these executive contributions. The Company temporarily suspended its matching contributions on the DC Plan effective April 1, 2009. |
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(3) | Aggregate earnings are not included as compensation in the current Summary Compensation Table. This item primarily reflects the change in market value of the deemed common stock held in each participant’s deferred compensation account. | |
(4) | The aggregate balance is as of 10/31/2010, and includes current and previous years’ executive and registrant contributions and the earnings on those contributions, less any withdrawals. The amounts reported in the aggregate balance at October 31, 2010 are reported in the Summary Compensation Table or were previously reported as compensation to the named executive officer in the Summary Compensation Table if such individual was included as a named executive officer in the respective previous years. |
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• | such employee’s payroll deductions; |
• | such employee’s 15% Company contribution; |
• | cash dividends received from us on all shares in such employee’s Stock Purchase Plan account at the time a dividend is paid; and |
• | cash resulting from the sale of any (i) rights to purchase additional shares of our stock or other securities of ours, or (ii) securities of any other issuer. |
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• | all or part of such participant’s Plan Shares at any time, if the participant is employed by us or in connection with a division or subsidiary of ours immediately before we sell or otherwise dispose of that division or subsidiary and after such sale or other disposition the participant is no longer employed by us or our subsidiary; and |
• | all or any part of such participant’s Plan Shares at any time after they have been held in the participant’s account for at least one year. |
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Quarters Ending
Base | ||||||||||||||||||||||||||||||||||||||||||||||||
Period | ||||||||||||||||||||||||||||||||||||||||||||||||
Company / Index | 4/23/08 | 4/30/08 | 7/31/08 | 10/31/08 | 1/31/09 | 4/30/09 | 7/31/09 | 10/31/09 | 1/31/10 | 4/30/10 | 7/31/10 | 10/31/10 | ||||||||||||||||||||||||||||||||||||
Quanex | 100 | 113.18 | 102.74 | 61.23 | 56.93 | 69.01 | 80.26 | 100.59 | 108.96 | 128.98 | 119.69 | 122.90 | ||||||||||||||||||||||||||||||||||||
S&P 500 Index | 100 | 100.41 | 92.35 | 71.01 | 61.00 | 64.95 | 73.92 | 77.97 | 81.21 | 90.18 | 84.15 | 90.85 | ||||||||||||||||||||||||||||||||||||
Russell 2000 Index | 100 | 101.17 | 101.28 | 76.49 | 63.42 | 70.07 | 80.29 | 81.43 | 87.41 | 104.37 | 95.09 | 102.73 | ||||||||||||||||||||||||||||||||||||
Peer Group | 100 | 103.65 | 87.45 | 69.35 | 58.66 | 74.07 | 87.49 | 80.06 | 86.32 | 114.88 | 86.83 | 84.49 |
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Common | Common | |||||||||||||||||||||||
Stock | Stock | |||||||||||||||||||||||
Restricted | Credited | Underlying | ||||||||||||||||||||||
Common Stock | Stock | Under | Exercisable | |||||||||||||||||||||
Owned of Record | Units | DC Plan | Options(1) | Total | Percent | |||||||||||||||||||
David D. Petratis | 177,712 | — | 83,350 | 240,098 | 501,160 | 1.30 | % | |||||||||||||||||
Brent L. Korb | 77,342 | — | — | 120,366 | 197,708 | * | ||||||||||||||||||
Kevin P. Delaney | 73,734 | — | — | 114,272 | 188,006 | * | ||||||||||||||||||
Deborah M. Gadin | 15,081 | — | 4,888 | 46,298 | 66,267 | * | ||||||||||||||||||
Jairaj T. Chetnani | 12,590 | — | 2,625 | 26,149 | 41,364 | * | ||||||||||||||||||
Donald G. Barger | 4,189 | 7,971 | 55,442 | 32,300 | 99,902 | * | ||||||||||||||||||
Susan F. Davis | 25,182 | 5,698 | 15,352 | 32,300 | 78,532 | * | ||||||||||||||||||
William C. Griffiths | — | 2,969 | — | 16,879 | 19,848 | * | ||||||||||||||||||
LeRoy D. Nosbaum | — | 1,398 | — | 6,390 | 7,788 | * | ||||||||||||||||||
Joseph D. Rupp | — | 5,698 | — | 32,300 | 37,998 | * | ||||||||||||||||||
Curtis M. Stevens | — | 1,398 | 546 | 6,390 | 8,334 | * | ||||||||||||||||||
All Officers and Directors as a group | 385,830 | 25,132 | 162,203 | 673,742 | 1,246,907 | 3.23 | % |
* | Less than 1.0% | |
(1) | Includes options exercisable within 60 days. |
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1. | The business of Quanex Building Products Corporation (the “Company”) shall be managed by a Board of Directors (the “Board”) who shall exercise all the powers of the Company not reserved to the shareholders by statute, the Certification of Incorporation or the By-Laws of the Company. | ||
2. | The Chief Executive Officer shall be a member of the Board |
3. | The size of the Board, the classification of directors, the term of office, and the process for filling vacancies shall be in accordance with the Company’s Certificate of Incorporation and By-Laws. |
4. | In its discretion from time to time and as vacancies may occur, the Board may choose to employ a leadership structure consisting of either (a) a joint Chairman of the Board and Chief Executive Officer with an independent Lead Director, or (b) a non-executive Chairman of the Board, who shall serve in the role of Lead Director, with a separate Chief Executive Officer. |
5. | The Board shall at all times maintain an Audit Committee, a Nominating & Corporate Governance Committee, and a Compensation & Management Development Committee, which shall operate in accordance with applicable laws, their respective Charters as adopted and amended from time to time by the Board, and the applicable rules of the Securities and Exchange Commission and the New York Stock Exchange. |
6. | The membership of the Audit Committee, the Compensation & Management Development Committee, or the Nominating & Corporate Governance Committee shall meet the independence requirements of applicable laws, the New York Stock Exchange, and if deemed appropriate from time to time, meet the definition of “non-employee director” under Rule 16b-3 under the Securities Exchange Act of 1934, and “outside director” for purposes of Section 162(m) of the Internal Revenue Code of 1986. |
7. | The Board may establish such other committees as it deems appropriate and delegate to such committees such authority permitted by applicable law and the Company’s By-Laws as the Board sees fit. |
8. | At each regular meeting of the Board, the Board shall meet in executive session, where non-management directors meet without management participation. |
9. | The Board, in executive session, shall conduct an annual review of the performance of the Chief Executive Officer, taking into account the views and recommendations of the Chairman of the Compensation & Management Development Committee as set forth in the Committee’s Charter. |
10. | The Board shall review policies and procedures developed by the Company and reviewed and approved by the Compensation & Management Development Committee, regarding succession to the position of Chief Executive Officer and positions of other corporate officers and key executives in the event of emergency or retirement. |
11. | The Board shall conduct an annual Self-Assessment to determine whether it and its committees are functioning effectively. The full Board shall discuss the evaluation to determine what, if any, action could improve Board and Board committee performance. |
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12. | The Board shall establish methods by which interested parties may communicate directly with the Chairpersons of each Committee or with non-employee directors of the Board as a group and cause such methods to be published. |
13. | The Company shall provide each director with complete access to the management of the Company, subject to reasonable notice to the Company and reasonable efforts to avoid disruption to the Company’s management, business and operations. |
14. | The Board and Board committees, to the extent set forth in the applicable committee Charter, have the right to consult and retain independent legal and other advisors at the expense of the Company. |
15. | The Board or the Company shall establish, or identify and provide access to, appropriate orientation programs, sessions or materials for newly-appointed directors of the Company for their benefit either prior to or within a reasonable period of time after their nomination or election as a director. |
16. | The Board or the Company shall encourage directors to periodically pursue or obtain appropriate programs, sessions or materials as to the responsibilities of directors of publicly-traded companies. |
17. | A majority of the members of the Board must qualify as independent directors in accordance with the applicable rules of the New York Stock Exchange. | ||
18. | A director shall not stand for re-election after reaching 70 years of age. |
19. | Directors shall promptly report changes in their business or professional affiliations or responsibilities, including retirement, to the Chairman of the Board and the Chairman of the Nominating & Corporate Governance Committee. |
20. | A director shall offer to resign from the Board if the Nominating & Corporate Governance Committee concludes that the director (a) no longer meets the Company’s requirements for service on the Board, or (b) has experienced a substantial reduction in responsibilities in full time employment. A director shall also offer to resign from the Board if the director has retired, been terminated, or has otherwise separated from an employer. |
21. | No director shall serve as a director, officer or employee of a competitor of the Company. |
22. | Non-employee directors shall not serve in a paid consulting role for the Company. |
23. | Directors shall advise the Chairman of the Board and the Chairman of the Nominating & Corporate Governance Committee promptly upon accepting any other public company directorship or any assignment to the Audit Committee or Compensation Committee of the board of directors of any public company of which such director is a member. |
24. | Non-employee directors shall serve on the board of no more than three other public companies. |
25. | A director who is also an officer of the Company shall not continue serving on the Board upon separation of employment with the Company, except in special instances to facilitate a transition of management. |
26. | The Nominating & Corporate Governance Committee shall be responsible for establishing additional qualifications for directors, taking into account the composition and skills of the entire Board. |
27. | Directors should exercise their business judgment to act in what they reasonably believe to be in the best interests of the Company in a manner consistent with their fiduciary duties. |
28. | Directors are expected to attend all Board meetings and meetings of committees to which they are assigned, and at a minimum, 75 percent of such meetings each year. |
29. | Directors are expected to prepare for all meetings of the Board or committees to which they are assigned by reviewing the materials that are sent to all directors in advance of meetings. |
30. | Non-employee directors are expected to own, beneficially or otherwise, common shares or common share equivalents of the Company’s Common Stock valued at no less than $200,000, which shares or share equivalents may be accumulated over the first five years of service. |
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31. | The Nominating & Corporate Governance Committee shall review and recommend for Board approval the form and amount of non-employee director compensation, including cash, equity-based awards and other director compensation. |
32. | In determining non-employee director compensation, the Nominating & Corporate Governance Committee, may consult with appropriate advisers to determine levels of director compensation similar to the compensation of directors of similar companies. |
33. | Non-employee directors shall be paid in equity and cash for their services, with a deferral option for fees paid in cash. |
34. | Unless and until a recommendation is made by the Nominating & Corporate Governance Committee and approval of the Board, the amount of cash compensation for non-employee directors is as follows: Retainer — $50,000/year paid quarterly; Committee Member Retainer Fees — $7,500/year paid quarterly for membership on the Audit Committee and $5,000/year paid quarterly for membership on the Compensation or Governance Committees; Committee chair fees — $15,000/year paid quarterly for Audit Committee and $10,000/year paid quarterly for Compensation and Governance Committees; Lead Director fee of $20,000/year paid quarterly; and reimbursement for all travel and living expenses associated with meeting attendance. |
35. | Unless and until a recommendation is made by the Nominating & Corporate Governance Committee and approval of the Board, new non-employee directors shall receive a one-time non-incentive stock option grant of 5,000 shares on his or her first anniversary of service on the Board. |
36. | Unless and until a recommendation is made by the Nominating & Corporate Governance Committee and approval of the Board, on the last business day of each fiscal year, non-employee directors shall receive an annual non-incentive stock option grant of $50,000 in equivalent value. |
37. | Unless and until a recommendation is made by the Nominating & Corporate Governance Committee and approval of the Board, on the last business day of each fiscal year, non-employee directors shall receive an annual restricted stock unit award of $25,000 in equivalent value. |
38. | Unless and until a recommendation is made by the Nominating & Corporate Governance Committee and approval of the Board, non-employee directors shall not receive any remuneration from the Company other than as set forth in this Director Compensation section of the Corporate Governance Guidelines. |
40. | The Lead Director shall be a member of the Executive Committee and shall have the following responsibilities: |
a. | Chairing the Board in the absence of the Chairman; |
b. | Acting as liaison between the Board and the Chairman, as requested by the Board; |
c. | In concert with the Chairman, setting the agenda for board meetings, based on input from directors and the annual meeting plans; |
d. | Ensuring that independent directors have adequate opportunity to meet in executive session without management present, and setting the agenda for, and moderating, all such sessions; |
e. | Communicating to the Chief Executive Officer, as appropriate, the results of executive sessions among independent directors; |
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f. | Ensuring that the Board has adequate resources, including full, timely and relevant information, to support its decision making requirements; |
g. | Organizing the Board’s evaluation of the Chairman and providing the Chairman with feedback related thereto; |
h. | Working with the Chairman to ensure proper committee structure and membership, including the assignment of members and committee chairs, and appropriate succession planning related to members and committee chairs; |
i. | Notifying the Chairman of the retention of outside advisors and consultants who report directly to the Board; |
j. | Participating in one-on-one discussions with individual directors, as requested by the Nominating & Corporate Governance Committee; |
k. | Leading the Board self-assessment process, in conjunction with the Nominating & Corporate Governance Committee; |
l. | Working with the Chairman to form Special Committees of the Board, as necessary; |
m. | Carrying out other duties as requested by the Board or the Nominating & Corporate Governance Committee. |
41. | The Chief Executive Officer shall serve on the board of no more than one other public company. |
42. | Other executive officers shall serve on the board of no more than one other public company. |
43. | The Chief Executive Officer is expected to own, beneficially or otherwise, common shares or common share equivalents of the Company’s Common Stock of at least 400% of the value of his/her base salary within three years of serving in said role. Senior officers are expected to own, beneficially or otherwise, common shares or common share equivalents of the Company’s Common Stock of at least 200% of their base salary and officers 100% of their base salary under the same terms. |
44. | To the extent permitted by law, and as determined by the Board in its judgment, the Company may require reimbursement of a portion of any cash performance-based bonus granted to the named executive officers and, if applicable, business unit leaders, where (a) the performance bonus payment was predicated upon the achievement of certain financial results that were subsequently the subject of a material restatement; and (b) a lower payment would have been made to the executive(s) based upon the restated financial results. In each such instance, the Company will, to the extent practicable, seek to recover the amount by which the individual cash performance bonus for the relevant period exceeded the lower payment that would have been made based on the restated financial results. No reimbursement shall be required if such material restatement was caused by or resulted from any change in accounting policy or rules. |
45. | The Quanex Corporate Governance Guidelines may be amended, modified, or waived by the Board and waivers of these Guidelines may also be granted by the Nominating & Corporate Governance Committee, subject to the disclosure and other provisions of the Securities Exchange Act of 1934, the rules promulgated thereunder and the applicable rules of the New York Stock Exchange. |
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1900 West Loop South, Suite 1500
Houston, Texas 77027
Direct Telephone | (713) 877-5349 | |||
Toll Free Telephone | (800) 231-8176 | |||
Toll Free HOTLINE | (888) 704-8222 |
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Joseph D. Rupp
Curtis M. Stevens
FY 2010 | FY 2009 | |||||||
Audit Fees(1) | $ | 1,076,000 | $ | 1,232,000 | ||||
Audit Related Fees(2) | 30,000 | 23,000 | ||||||
Tax Fees(3) | 50,000 | 42,000 | ||||||
Transaction Related Fees(4) | — | 2,000 | ||||||
All Other Fees | — | — | ||||||
Total | $ | 1,156,000 | $ | 1,299,000 | ||||
(1) | Audit Fees consist of professional services and related expenses rendered by Deloitte & Touche LLP for the audit of our annual financial statements, audit of internal controls and review of financial statements included in Forms 10-Q and Form 10-K. | |
(2) | Audit Related Fees include employee benefit audits as well as assurance and related services by Deloitte & Touche LLP that are reasonably related to the performance of the audit or review of our financial statements and are not included in Audit Fees. | |
(3) | Tax Fees include professional services rendered by Deloitte & Touche LLP for tax return reviews and miscellaneous consulting. | |
(4) | Transaction Related Fees represent services provided by Deloitte & Touche LLP related to the spin-off and merger that occurred in April 2008. |
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William C. Griffiths
LeRoy D. Nosbaum
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Susan F. Davis
Joseph D. Rupp
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Amount and | ||||||||
Nature of | ||||||||
Beneficial | Percent | |||||||
Name and Address | Ownership | (%) | ||||||
Fidelity Management & Research, LLC, 82 Devonshire St., Boston, MA 02109 | 3,723,160 | (1) | 9.6 | |||||
State Street Global Advisors (US), One Lincoln Place, Boston, MA 02111 | 2,810,642 | (2) | 7.5 | |||||
BlackRock Institutional Trust Company N.A., 400 Howard Street, San Francisco, CA 94105 | 2,908,365 | (3) | 7.1 | |||||
Artisan Partners Limited Partnership, 875 East Wisconsin Avenue, Suite 80, Milwaukee, WI 53202 | 2,572,859 | (4) | 6.8 | |||||
Keeley Asset Management Corp., 401 South LaSalle Street, Suite 1201, Chicago, IL 60605 | 1,877,500 | (5) | 5.0 |
(1) | Fidelity Management & Research, a wholly owned subsidiary of FMR LLC, has sole voting authority on 193,460 shares and investment discretion with respect to all shares. Fidelity reported this ownership amount as of November 15, 2010. | |
(2) | State Street Global Advisors (US) possesses shared voting authority on all shares. | |
(3) | BlackRock Institutional Trust Company N.A. (formerly Barclays Global Investors, a subsidiary of Barclays PLC), is an asset management subsidiary of BlackRock Inc., and possesses sole voting authority with respect to all shares. | |
(4) | Artisan Partners Limited Partnership, a subsidiary of Artisan Partners Holding LP, possesses shared voting authority with respect to 2,401,859 shares. | |
(5) | Keeley Asset Management Corp. possesses sole investment discretion and sole voting authority on all shares. |
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January 24, 2011
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Quanex Building Products Corporation
2008 Omnibus Incentive Plan
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2008 OMNIBUS INCENTIVE PLAN
AS AMENDED EFFECTIVE FEBRUARY 24, 2011
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ARTICLE I ESTABLISHMENT, PURPOSE AND DURATION | 1 | |||
1.1 Establishment | 1 | |||
1.2 Purpose of the Plan | 1 | |||
1.3 Duration of Plan | 1 | |||
ARTICLE II DEFINITIONS | 2 | |||
2.1 Affiliate | 2 | |||
2.2 Annual Incentive Award | 2 | |||
2.3 Award | 2 | |||
2.4 Award Agreement | 2 | |||
2.5 Board | 2 | |||
2.6 Cash-Based Award | 2 | |||
2.7 Change in Control of the Company | 2 | |||
2.8 Code | 3 | |||
2.9 Committee | 3 | |||
2.10 Company | 3 | |||
2.11 Corporate Change | 3 | |||
2.12 Covered Employee | 3 | |||
2.13 Director | 3 | |||
2.14 Disability | 3 | |||
2.15 Dividend Equivalent | 4 | |||
2.16 Effective Date | 4 | |||
2.17 Employee | 4 | |||
2.18 Fair Market Value | 4 | |||
2.19 Fiscal Year | 4 | |||
2.20 Full Value Award | 4 | |||
2.21 Holder | 4 | |||
2.22 Minimum Statutory Tax Withholding Obligation | 4 | |||
2.23 Option | 4 | |||
2.24 Option Price | 4 | |||
2.25 Other Stock-Based Award | 4 | |||
2.26 Performance-Based Compensation | 4 | |||
2.27 Performance Goals | 4 | |||
2.28 Performance Stock Award | 4 | |||
2.29 Performance Unit Award | 5 | |||
2.30 Period of Restriction | 5 | |||
2.31 Permissible under Section 409A | 5 | |||
2.32 Plan | 5 | |||
2.33 Restricted Stock | 5 | |||
2.34 Restricted Stock Award | 5 | |||
2.35 RSU | 5 | |||
2.36 RSU Award | 5 | |||
2.37 SAR | 5 | |||
2.38 Section 409A | 5 | |||
2.39 Stock | 5 | |||
2.40 Substantial Risk of Forfeiture | 5 | |||
2.41 Termination of Employment | 5 | |||
ARTICLE III ELIGIBILITY AND PARTICIPATION | 6 | |||
3.1 Eligibility | 6 | |||
3.2 Participation | 6 |
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ARTICLE IV GENERAL PROVISIONS RELATING TO AWARDS | 7 | |||
4.1 Authority to Grant Awards | 7 | |||
4.2 Dedicated Shares; Maximum Awards | 7 | |||
4.3 Non-Transferability | 8 | |||
4.4 Requirements of Law | 8 | |||
4.5 Changes in the Company’s Capital Structure | 8 | |||
4.6 Election Under Section 83(b) of the Code | 11 | |||
4.7 Forfeiture for Cause | 11 | |||
4.8 Forfeiture Events | 11 | |||
4.9 Award Agreements | 11 | |||
4.10 Amendments of Award Agreements | 12 | |||
4.11 Rights as Stockholder | 12 | |||
4.12 Issuance of Shares of Stock | 12 | |||
4.13 Restrictions on Stock Received | 12 | |||
4.14 Compliance With Section 409A | 12 | |||
ARTICLE V OPTIONS | 13 | |||
5.1 Authority to Grant Options | 13 | |||
5.2 Option Agreement | 13 | |||
5.3 Option Price | 13 | |||
5.4 Duration of Option | 13 | |||
5.5 Amount Exercisable | 13 | |||
5.6 Exercise of Option | 13 | |||
ARTICLE VI STOCK APPRECIATION RIGHTS | 14 | |||
6.1 Authority to Grant SAR Awards | 14 | |||
6.2 General Terms | 14 | |||
6.3 SAR Agreement | 14 | |||
6.4 Term of SAR | 14 | |||
6.5 Exercise of SAR | 14 | |||
6.6 Payment of SAR Amount | 14 | |||
6.7 Termination of Employment | 14 | |||
ARTICLE VII RESTRICTED STOCK AWARDS | 15 | |||
7.1 Restricted Stock Awards | 15 | |||
7.2 Restricted Stock Award Agreement | 15 | |||
7.3 Holder’s Rights as Stockholder | 15 | |||
ARTICLE VIII RESTRICTED STOCK UNIT AWARDS | 16 | |||
8.1 Authority to Grant RSU Awards | 16 | |||
8.2 RSU Award | 16 | |||
8.3 RSU Award Agreement | 16 | |||
8.4 Dividend Equivalents | 16 | |||
8.5 Form of Payment Under RSU Award | 16 | |||
8.6 Time of Payment Under RSU Award | 16 | |||
ARTICLE IX PERFORMANCE STOCK AWARDS AND PERFORMANCE UNIT AWARDS | 17 | |||
9.1 Authority to Grant Performance Stock Awards and Performance Unit Awards | 17 | |||
9.2 Performance Goals | 17 | |||
9.3 Time of Establishment of Performance Goals | 17 | |||
9.4 Written Agreement | 17 | |||
9.5 Form of Payment Under Performance Unit Award | 18 | |||
9.6 Time of Payment Under Performance Unit Award | 18 | |||
9.7 Holder’s Rights as Stockholder With Respect to a Performance Stock Award | 18 | |||
9.8 Increases Prohibited | 18 |
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ARTICLE X ANNUAL INCENTIVE AWARDS | 19 | |||
10.1 Authority to Grant Annual Incentive Awards | 19 | |||
10.2 Covered Employees | 19 | |||
10.3 Written Agreement | 19 | |||
10.4 Form of Payment Under Annual Incentive Award | 19 | |||
10.5 Time of Payment Under Annual Incentive Award | 19 | |||
10.6 Increases Prohibited | 19 | |||
ARTICLE XI OTHER STOCK-BASED AWARDS | 20 | |||
11.1 Authority to Grant Other Stock-Based Awards | 20 | |||
11.2 Value of Other Stock-Based Award | 20 | |||
11.3 Payment of Other Stock-Based Award | 20 | |||
11.4 Termination of Employment | 20 | |||
ARTICLE XII CASH-BASED AWARDS | 21 | |||
12.1 Authority to Grant Cash-Based Awards | 21 | |||
12.2 Value of Cash-Based Award | 21 | |||
12.3 Payment of Cash-Based Award | 21 | |||
12.4 Termination of Employment | 21 | |||
ARTICLE XIII SUBSTITUTION AWARDS | 22 | |||
ARTICLE XIV ADMINISTRATION | 23 | |||
14.1 Awards | 23 | |||
14.2 Authority of the Committee | 23 | |||
14.3 Decisions Binding | 23 | |||
14.4 No Liability | 23 | |||
ARTICLE XV AMENDMENT OR TERMINATION OF PLAN | 24 | |||
15.1 Amendment, Modification, Suspension, and Termination | 24 | |||
15.2 Awards Previously Granted | 24 | |||
ARTICLE XVI MISCELLANEOUS | 25 | |||
16.1 Unfunded Plan/No Establishment of a Trust Fund | 25 | |||
16.2 No Employment Obligation | 25 | |||
16.3 Tax Withholding | 25 | |||
16.4 Gender and Number | 26 | |||
16.5 Severability | 26 | |||
16.6 Headings | 26 | |||
16.7 Other Compensation Plans | 26 | |||
16.8 Retirement and Welfare Plans | 26 |
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16.9 Other Awards | 26 | |||
16.10 Successors | 26 | |||
16.11 Law Limitations/Governmental Approvals | 26 | |||
16.12 Delivery of Title | 26 | |||
16.13 Inability to Obtain Authority | 26 | |||
16.14 Investment Representations | 27 | |||
16.15 Persons Residing Outside of the United States | 27 | |||
16.16 Arbitration of Disputes | 27 | |||
16.17 Governing Law | 27 | |||
16.18 Section 162(m) Stockholder Approval | 27 |
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Senior Vice President — General Counsel and Secretary |
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Shareowner ServicesSM P.O. Box 64945 St. Paul, MN 55164-0945 |
COMPANY # | ||
TO VOTE BY INTERNET OR TELEPHONE, SEE REVERSE SIDE OF THIS PROXY CARD. |
1. | To elect three directors to serve until the Annual Meeting of Stockholders in 2014 | 01 Susan F. Davis 02 Joseph D. Rupp 03 Curtis M. Stevens | o | Vote FOR all nominees (except as marked) | o | Vote WITHHELD from all nominees |
write the number(s) of the nominee(s) in the box provided to the right.)
2. | To provide a non-binding advisory vote approving the Company’s executive compensation program; | o | For | o | Against | o | Abstain | |||||||||||
3. | To provide a non-binding advisory vote on the proposed timeline for seeking executive compensation advisory votes in the future; | o | 1 Year | o | 2 Years | o | 3 Years | o | Abstain | |||||||||
4. | To approve an amendment to the Company’s 2008 Omnibus Incentive Plan to increase the number of shares available for grant under the Plan; | o | For | o | Against | o | Abstain | |||||||||||
5. | To ratify the appointment of Deloitte & Touche LLP as the Company’s external auditors; and | o | For | o | Against | o | Abstain | |||||||||||
6. | To transact such other business as may properly come before the meeting or any adjournment or adjournments thereof. |
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Quanex Building Products Corporation 1900 West Loop South, Suite 1500 Houston, TX 77027 | proxy |
24 Hours a Day, 7 Days a Week
in the same manner as if you marked, signed and returned your proxy card.
INTERNET | PHONE | |||
www.eproxy.com/nx | 1-800-560-1965 | |||
Mark, sign and date your proxy | ||||
Use the Internet to vote your proxy | Use a touch-tone telephone to | card and return it in the | ||
until 12:00 p.m. (CT) on | vote your proxy until 12:00 p.m. | postage-paid envelope provided. | ||
February 23, 2011. | (CT) on February 23, 2011. |