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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Act of 1934
(Amendment No. )
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Filed by a Party other than the Registranto
Check the appropriate box:
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x | Definitive Proxy Statement | |||
o | Definitive Additional Materials | |||
o | Soliciting Material Pursuant to Rule 14a-12 |
Express Scripts, Inc.
Payment of Filing Fee (Check the appropriate box):
x | No fee required. | |||
o | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
(1) | Title of each class of securities to which transaction applies: | |||
(2) | Aggregate number of securities to which transaction applies: | |||
(3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): | |||
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(1) | Amount previously paid: | |||
(2) | Form, Schedule or Registration Statement No.: | |||
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(4) | Date filed: | |||
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1. | to elect eleven (11) directors to serve until the next Annual Meeting of Stockholders or until their respective successors are elected and qualified; | |
2. | to ratify the appointment of PricewaterhouseCoopers LLP as the Company’s independent accountants for the Company’s current fiscal year; and | |
3. | to transact such other business as may properly come before the meeting or any adjournments thereof. |
By Order of the Board of Directors | |
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Thomas M. Boudreau | |
Senior Vice President, General Counsel and Secretary |
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1. Election of directors (see page 6) | |
2. Ratification of PricewaterhouseCoopers LLP as independent accountants for 2005 (see page 28) |
• | by toll-free telephone at 1-800-PROXIES (1-800-776-9437) | |
• | by Internet at www.voteproxy.com | |
• | by completing and returning your proxy card | |
• | by written ballot at the meeting |
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1. FOR each of the nominees as directors | |
2. FOR ratification of the appointment of PricewaterhouseCoopers LLP as independent accountants for 2005 |
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Shares Beneficially Owned | ||||||||
Percent of | ||||||||
Name and Address | Number | Class(1) | ||||||
Barrett A. Toan(2) | 912,179 | 1.23 | % | |||||
Gary G. Benanav(3) | 28,000 | * | ||||||
Frank J. Borelli(4) | 96,720 | * | ||||||
Nicholas J. LaHowchic(5) | 20,000 | * | ||||||
Thomas P. Mac Mahon(6) | 20,000 | * | ||||||
John O. Parker, Jr.(7) | 20,000 | * | ||||||
George Paz(8) | 202,713 | * | ||||||
Samuel K. Skinner(9) | 1,500 | * | ||||||
Seymour Sternberg(10) | 31,475 | * | ||||||
Howard L. Waltman(11) | 78,000 | * | ||||||
Maura C. Breen(12) | 0 | * | ||||||
David A. Lowenberg(13) | 148,346 | * | ||||||
Thomas M. Boudreau(14) | 124,807 | * | ||||||
Edward Tenholder(15) | 43,139 | * | ||||||
Directors and Executive Officers as a Group (22 persons)(16) | 1,972,010 | 2.66 | % | |||||
New York Life Insurance Company; NYLIFE, LLC(17) | 12,000,230 | 16.21 | % | |||||
Capital Research and Management Company(18) | 10,156,000 | 13.72 | % | |||||
Putnam, LLC; Marsh & McLennan Companies, Inc., Putnam Investment Management, LLC; The Putnam Advisory Company, LLC(19) | 4,715,765 | 6.37 | % |
(1) | Percentages based on 74,022,218 shares of Common Stock issued and outstanding on March 1, 2005. |
(2) | Consists of options for 690,300 shares granted under the Company’s Amended and Restated 1992 and 1994 Stock Option Plans, and its 2000 Long Term Incentive Plan (collectively, the “Employee Stock Option Plans”) (See “Executive Compensation — Employment Agreements” for a description of the terms of his employment agreement with the Company governing his options), 72,783 shares owned by Mr. Toan, 120,000 restricted shares awarded under the 2000 Long Term Incentive Plan (the “2000 LTIP”), and 29,096 phantom shares representing fully-vested investments in the Company Stock Fund under the Company’s Executive Deferred Compensation Plan (the “EDCP”). |
(3) | Consists of options for 26,000 shares granted under the 2000 LTIP and 2,000 shares owned by a trust established by Mr. Benanav. |
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(4) | Consists of options for 96,000 shares granted under the Amended and Restated 1992 Stock Option Plan for Outside Directors (the “Outside Directors Plan”) and 720 shares held in trusts for family members. |
(5) | Consists of options for 19,000 shares granted under the 2000 LTIP, and 1,000 shares owned by Mr. LaHowchic. |
(6) | Consists of options for 20,000 shares granted under the 2000 LTIP. |
(7) | Consists of options for 20,000 shares granted under the 2000 LTIP. |
(8) | Consists of options for 150,430 shares granted under the Employee Stock Option Plans, 20,761 shares owned by Mr. Paz, 26,355 restricted shares awarded under the 2000 LTIP, and 5,167 phantom shares representing fully-vested investments in the Company Stock Fund under the EDCP. Excluded are 1,734 phantom shares representing unvested investments in the Company Stock Fund under the EDCP. |
(9) | Consists of options for 1,500 shares, granted under the 2000 LTIP. |
(10) | Consists of options for 26,000 shares granted under the 2000 LTIP, and 5,475 shares owned by Mr. Sternberg, but excludes 720 shares held by Mr. Sternberg’s son as to which shares Mr. Sternberg disclaims beneficial ownership. |
(11) | Consists of options for 76,000 shares granted under the Outside Directors Plan, and 2,000 shares owned by Mr. Waltman. |
(12) | Ms. Breen has received options to purchase 4,500 shares granted under the 2000 LTIP, none of which have vested. |
(13) | Consists of options for 93,626 shares granted under the Employee Stock Option Plans, 26,823 shares owned by Mr. Lowenberg, 22,451 restricted shares awarded under the 2000 LTIP, and 5,446 phantom shares representing fully-vested investments in the Company Stock Fund under the EDCP. Excluded are 350 shares held by Mr. Lowenberg’s minor children, as to which Mr. Lowenberg disclaims beneficial ownership, and 1,575 phantom shares representing unvested investments in the Company Stock Fund under the EDCP. |
(14) | Consists of options for 89,010 shares granted under the Employee Stock Option Plans, 17,650 shares owned by Mr. Boudreau, 14,226 restricted shares awarded under the 2000 LTIP, and 3,921 phantom shares representing fully-vested investments in the Company Stock Fund under the EDCP. Excluded are 200 shares held by Mr. Boudreau’s spouse, as to which Mr. Boudreau disclaims beneficial ownership, and 1,729 phantom shares representing unvested investments in the Company Stock Fund under the EDCP. |
(15) | Consists of options for 14,543 shares granted under the Employee Stock Option Plans, 12,500 shares owned by Mr. Tenholder, 16,000 restricted shares awarded under the 2000 LTIP, and 96 phantom shares representing fully-vested investments in the Company Stock Fund under the EDCP. Excluded are 2,633 phantom shares representing unvested investments in the Company Stock Fund under the EDCP. |
(16) | Consists of options for 1,443,422 shares granted under the Outside Directors Plan and the Employee Stock Option Plans, 170,557 shares owned by directors and officers as a group, 308,546 restricted shares awarded under the 2000 LTIP, and 49,485 phantom shares representing fully-vested investments in the Company Stock Fund under the EDCP. Excluded are 16,149 phantom shares representing unvested investments in the Company Stock Fund under the EDCP. |
(17) | The information with respect to the beneficial ownership of these shares as of December 31, 2003 has been obtained from a copy of an Amendment No. 5 to Schedule 13G filed February 13, 2004. Such filing reports that the beneficial owner, New York Life Insurance Company (“New York Life”), shares voting power with respect to all of the shares reported, but has sole dispositive power as to all of the shares reported, and that NYLIFE, LLC (“NYLife”), a subsidiary of New York Life, owns 4,500,000 of such shares. As described further in “Certain Relationships and Related Party Transactions — Relationship with New York Life” beginning on page 16, in August NYLife entered into a ten-year forward sale contract with respect to 4,500,000 of the shares of Common Stock, and, in April 2003 New York Life entered into a five-year forward sale contract with respect to 5,500,000 of the shares of Common Stock. Absent the occurrence of certain accelerating events, New York Life or NYLife, as applicable, retains the right to vote the shares subject to such forward sale contracts, but is subject to restrictions on the transfer of such shares. The address for New York Life and NYLife is 51 Madison Avenue, New York, NY 10010. Mr. Sternberg, a director of the Company, is also a director and holds various executive positions with New York Life, as described herein, and Mr. Benanav, a director of the Company, was also a director and held various executive positions with New York Life, as described herein, prior to his retirement from New York Life on March 1, 2005. Both Mr. Sternberg and Mr. Benanav disclaim beneficial ownership of the Company’s Common Stock owned by NYLife or New York Life. |
(18) | This information is based on an Amendment No. 2 to Schedule 13G, filed with the Securities and Exchange Commission on February 11, 2005 by Capital Research and Management Company (“CRMC”) on behalf of itself and The Growth Fund of America (“GFA”), which indicated that (a) CRMC has sole dispositive power with respect to 10,156,000 shares, with respect to all of which CRMC disclaims beneficial ownership, and (b) GFA has sole voting power with respect to 4,710,000 shares. GFA is an investment company which is advised by CRMC. The address for CRMC is 333 South Hope Street, Los Angeles, CA 90071. |
(19) | This is based on a Schedule 13G filed with the Securities and Exchange Commission on February 11, 2005 by Putnam, LLC d/b/a Putnam Investments (“Putnam Investments”), on behalf of itself, its parent, Marsh & McLennan Companies, Inc. (“M&MC”), and the following of its wholly-owned subsidiaries: Putnam Investment Management, LLC, which beneficially owns and has shared dispositive power with respect to 4,247,803 of such shares, and which has shared voting power with respect |
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to 123,277 of such shares; and The Putnam Advisory Company, LLC, which beneficially owns and has shared dispositive power with respect to 467,962 of such shares, and which has shared voting power with respect to 341,738 of such shares. M&MC reports no voting or investment power with respect to the shares. Putnam Investments reports that it beneficially owns and has shared dispositive power with respect to 4,715,765 shares, and shared voting power with respect to 465,015 of such shares. The address for Putnam is One Post Office Square, Boston, MA 02109. |
Number of Securities | ||||||||||||
Remaining Available | ||||||||||||
for Future Issuance | ||||||||||||
Number of Securities | Under Equity | |||||||||||
to Be Issued Upon | Weighted Average of | Compensation Plans | ||||||||||
Exercise of | Outstanding | (excluding securities | ||||||||||
Outstanding Options, | Options, Warrants, | reflected in | ||||||||||
Warrants and Rights | Rights | column (a)) | ||||||||||
Plan Category | (a) | (b) | (c) | |||||||||
Equity Compensation Plans approved by security holders | 3,678,178 | (3) | $ | 43.71 | (4) | 5,414,160 | (1)(2) | |||||
Equity Compensation Plans not approved by security holders | 0 | — | 0 | |||||||||
Total | 3,678,178 | (3) | $ | 43.71 | (4) | 5,414,160 | (1)(2) | |||||
(1) | The number of shares available for distribution under the 2000 LTIP automatically increased by 1,400,000 shares on January 1, 2004. The number of shares available for distribution under the 2000 LTIP is also increased by any shares made available as a result of forfeitures of awards made under the 2000 LTIP, or any of the Company’s Amended and Restated 1992 Stock Option Plan, Amended and Restated 1994 Stock Option Plan or Amended and Restated 1992 Stock Option Plan for Outside Directors. |
(2) | Includes 4,496,323 shares remaining available for future issuance under the 2000 LTIP. The 2000 LTIP provides for the issuance of restricted stock awards and a portion of these remaining shares will likely be issued as restricted stock awards. |
(3) | Includes shares which were issued under the Employee Stock Purchase Plan for the month of January 2005. Does not include restricted stock awarded. |
(4) | Shares allocated to the Executive Deferred Compensation Plan and shares which were issued for the month of January 2005 under the Employee Stock Purchase Plan are not included in the weighted average computation. |
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Meetings | ||||
Members | Principal Functions | in 2004 | ||
Audit Committee Frank J. Borelli (Chair)* Maura C. Breen Nicholas J. LaHowchic John O. Parker, Jr. * Mr. Borelli has been determined by the Board, in its judgment, to be an audit committee financial expert, as defined under applicable SEC rules | • Assist the Board in its oversight of (i) the integrity of the Company’s financial statements; (ii) the Company’s compliance with securities laws, including financial and disclosure requirements; (iii) the Company’s system of internal controls and the performance of the Company’s internal audit function; and (iv) the qualifications, independence and performance of the Company’s independent accountants. • Select, retain and oversee the Company’s independent accountants. • Review the Company’s annual and interim financial statements. • Establish procedures for the receipt and handling of complaints regarding accounting, internal accounting controls or auditing matters. | 11 | ||
Compensation & Development Committee Gary G. Benanav (Chair) Thomas P. Mac Mahon Howard L. Waltman | • Review and approve the Company’s stated compensation strategy. • Review annually the performance of the Company’s Chief Executive Officer. • Review and approve compensation, and set performance criteria for compensation programs, for all senior executives of the Company. • Review and make recommendations to the Corporate Governance Committee regarding compensation of Directors. • Approve forms of employment agreements for senior executives of the Company. • Approve and oversee the administration of the Company’s employee benefit plans and incentive compensation programs. | 7 | ||
Compliance Committee Nicholas J. LaHowchic (Chair) Samuel K. Skinner Seymour Sternberg | • Review and make recommendations to the Board addressing the Company’s legal and regulatory compliance practices generally (excluding SEC and financial reporting matters). • Review the Company’s Corporate Code of Conduct at least annually and make recommendations to the Board with respect to changes to the Code of Conduct. • Meet regularly with management of the Company to assess the Company’s compliance policies and procedures. • Review and approve a Code of Business Conduct and Ethics, and oversee implementation by management of procedures intended to ensure compliance with such Code. | 4 | ||
Corporate Governance Committee Howard L. Waltman (Chair) Frank J. Borelli John O. Parker, Jr. Seymour Sternberg | • Establish criteria for membership of the Company’s Board of Directors and its committees. • Select and nominate candidates for election or reelection as directors at the Company’s annual stockholders’ meeting. • Consider stockholder recommendations for and nominations of candidates for election as directors. • Recommend candidates to fill any vacancies on the Board of Directors. • Review and make recommendations to the Board regarding the Company’s Corporate Governance Guidelines and the nature and duties of the committees of the Board. • Approve and make adjustments to the Company’s policies regarding compensation of Directors. | 4 | ||
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• | the nominee’s independence; | |
• | the nominee’s relevant professional skills and depth of business experience; | |
• | the nominee’s character, judgment, and personal and professional integrity; | |
• | the nominee’s ability to read and understand corporate financial statements; | |
• | the nominee’s willingness to commit sufficient time to attend to his or her duties and responsibilities as a member of the Board; | |
• | the nominee’s qualifications for membership on certain committees of the Board; | |
• | any potential conflicts of interest involving the nominee; and | |
• | the make up and diversity of the Company’s existing Board. |
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• | The Committee has reviewed and discussed with management and with PricewaterhouseCoopers LLP (“PwC”), the Company’s independent auditors, the audited consolidated financial statements of the Company for the year ended December 31, 2004 (the “Financial Statements”). | |
• | PwC has advised the management of the Company and the Committee that it has discussed with them all the matters required to be discussed by Statement of Accounting Standards 61, as modified, which include among other items, matters related to the conduct of the audit of the Financial Statements. | |
• | The Committee has received from PwC the written disclosures and the letter required by Independent Standards Board Standard No. 1 (which relates to the auditor’s independence from the Company and its related entities) and has discussed PwC’s independence with them. | |
• | Based upon the aforementioned review, discussions and representations of PwC, and the unqualified audit opinion presented by PwC on the Financial Statements, the Committee recommended to the Board of Directors that the Financial Statements be included in the Company’s Annual Report on Form 10-K. |
Respectfully submitted, | |
Frank Borelli, Chairman | |
Maura C. Breen | |
Nicholas J. LaHowchic | |
John O. Parker, Jr. |
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COMPENSATION AND DEVELOPMENT COMMITTEE | |
Gary Benanav, Chairman | |
Thomas P. Mac Mahon | |
Howard Waltman |
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![(PERFORMANCE GRAPH)](https://capedge.com/proxy/DEF 14A/0000950137-05-004777/c94249dc9424957.gif)
Base | ||||||||||||||
Period | ||||||||||||||
Company/Index | Dec 99 | Dec 00 | Dec 01 | Dec 02 | Dec 03 | Dec 04 | ||||||||
EXPRESS SCRIPTS, INC | 100 | 159.75 | 146.13 | 150.13 | 207.59 | 238.88 | ||||||||
S & P 500 INDEX | 100 | 89.86 | 78.14 | 59.88 | 75.68 | 82.49 | ||||||||
S & P 500 - HEALTH CARE | 100 | 135.54 | 118.00 | 94.33 | 107.00 | 107.25 | ||||||||
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Long-Term Compensation | |||||||||||||||||||||||||
Annual Compensation | Restricted | Securities | |||||||||||||||||||||||
Stock | Underlying | All Other | |||||||||||||||||||||||
Name and Principal Position | Year | Salary($)(2) | Bonus($)(2) | Awards($)(3) | Options(#) | Compensation($)(4) | |||||||||||||||||||
Barrett A. Toan | 2004 | 778,846 | 375,000 | — | 29,500 | 96,902 | |||||||||||||||||||
Chairman, Chief Executive Officer | 2003 | 750,000 | 637,500 | 1,287,200 | — | 131,210 | |||||||||||||||||||
and Director(1) | 2002 | 750,000 | 1,303,500 | — | 42,800 | 138,800 | |||||||||||||||||||
George Paz | 2004 | 571,154 | 270,000 | 1,341,495 | 38,791 | 218,200 | (5) | ||||||||||||||||||
President, and Director(1) | 2003 | 372,307 | 230,225 | 450,520 | — | 203,019 | (6) | ||||||||||||||||||
2002 | 340,000 | 368,320 | — | 11,100 | 201,332 | (7) | |||||||||||||||||||
David A. Lowenberg | 2004 | 464,810 | 189,000 | 913,303 | 26,671 | 354,100 | (8) | ||||||||||||||||||
Chief Operating Officer | 2003 | 400,000 | 205,000 | 514,880 | — | 60,278 | |||||||||||||||||||
2002 | 400,000 | 471,308 | — | 13,750 | 60,080 | ||||||||||||||||||||
Thomas M. Boudreau | 2004 | 361,462 | 135,000 | 462,536 | 16,285 | 292,700 | (9) | ||||||||||||||||||
Senior Vice President | 2003 | 310,000 | 153,450 | 450,520 | — | 44,400 | |||||||||||||||||||
and General Counsel | 2002 | 310,000 | 296,670 | — | 9,000 | 43,971 | |||||||||||||||||||
Edward Tenholder | 2004 | 311,538 | 89,100 | — | 6,630 | 34,553 | |||||||||||||||||||
Senior Vice President | 2003 | 300,000 | 140,250 | 450,520 | — | 43,297 | |||||||||||||||||||
and Chief Administrative Officer | 2002 | 300,000 | 288,296 | 443,700 | 26,000 | 544,849 | (10) |
(1) | Mr. Toan retired as Chief Executive Officer of the Company on March 31, 2005, and Mr. Paz assumed the office of Chief Executive Officer on April 1, 2005 | |
(2) | The amounts in this column represent compensation awarded pursuant to an employment agreement between Named Officer and the Company (see “Executive Compensation — Employment Agreements” beginning on page 19) and the Company’s annual bonus plan. | |
(3) | The amounts in this column represent the dollar value of the grant of restricted stock based on the value of the Company’s common stock on the grant date. All grants of restricted stock were made under the 2000 LTIP. Dividends are paid on restricted stock awards at the same rate as paid to all shareholders. Each of the Named Officers received a grant of restricted stock on May 21, 2003 (the “May 2003 Grant”), one-half of which were scheduled to vest on May 21, 2008, with the other one-half scheduled to vest on May 21, 2013; provided, that the lapse of restrictions could be accelerated based on the achievement by the Company of certain financial performance targets for 2003, 2004 and 2005, with one-third of the total grant tied to the targets for each year. Based on the achievement of such targets for 2003 and 2004, vesting on two-thirds of the restricted stock granted in the May 2003 Grant was accelerated in March 2005, with the accelerated shares divided evenly from those originally scheduled to vest in 2008 and those scheduled for vesting in 2013. All shares granted under the May 2003 grant have been valued at $64.36 per share, the closing price on May 21, 2003. |
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(4) | The amounts shown in this column consist of basic Company credit contributions under the EDCP, and matching contribution in connection with the Company’s 401(k) Plan. | |
(5) | The amount also includes a special deferred bonus in the amount of $150,000 credited to Mr. Paz’s account in the EDCP which generally vests on December 31, 2006, subject to earlier vesting under the provisions of Mr. Paz’s employment agreement with the Company. | |
(6) | The amount also includes a special deferred bonus in the amount of $150,000 credited to Mr. Paz’s account in the EDCP which generally vests on December 31, 2005, subject to earlier vesting under the provisions of Mr. Paz’s employment agreement with the Company. | |
(7) | The amount also includes a special deferred bonus in the amount of $150,000 credited to Mr. Paz’s account in the EDCP which vested on December 31, 2004. | |
(8) | The amount also includes a special deferred bonus in the amount of $300,000 credited to Mr. Lowenberg’s account in the EDCP which generally vests on March 31, 2006, subject to earlier vesting under the provisions of Mr. Lowenberg’s employment agreement with the Company. | |
(9) | The amount also includes a special deferred bonus in the amount of $200,000 credited to Mr. Boudreau’s account in the EDCP which generally vests on March 31, 2006, subject to earlier vesting under the provisions of Mr. Boudreau’s employment agreement with the Company, and a signing bonus in the amount of $50,000 paid pursuant to the employment agreement. |
(10) | This amount includes a special deferred bonus in the amount of $500,000 credited to Mr. Tenholder’s account in the EDCP which generally vests December 31, 2006, subject to the provisions of Mr. Tenholder’s employment agreement with the Company. |
Individual Grants | ||||||||||||||||||||||||
Potential Realizable Value | ||||||||||||||||||||||||
Number of | Percent of | at Assumed Annual Rates | ||||||||||||||||||||||
Securities | Total Options | of Stock Price Appreciation | ||||||||||||||||||||||
Underlying | Granted to | for Options Term(2) | ||||||||||||||||||||||
Options | Employees in | Exercise | Expiration | |||||||||||||||||||||
Name | Granted (#) | Fiscal Year(1) | Price ($/Sh)(5) | Date | 5% ($) | 10% ($) | ||||||||||||||||||
Barrett A. Toan | 29,500 | (3)(4) | 4.03% | $ | 75.16 | 3/5/11 | $ | 902,641 | $ | 2,103,527 | ||||||||||||||
George Paz | 18,002 | (4)(6) | 2.46% | $ | 69.31 | 2/10/11 | $ | 507,944 | $ | 1,183,740 | ||||||||||||||
20,789 | (3)(4) | 2.84% | $ | 75.16 | 3/5/11 | $ | 636,102 | $ | 1,482,380 | |||||||||||||||
David A. Lowenberg | 9,117 | (3)(4) | 1.24% | $ | 75.16 | 3/5/11 | $ | 278,962 | $ | 650,097 | ||||||||||||||
17,554 | (4)(7) | 2.40% | $ | 63.20 | 8/31/11 | $ | 451,647 | $ | 1,052,520 | |||||||||||||||
Thomas M. Boudreau | 6,630 | (3)(4) | 0.9% | $ | 75.16 | 3/5/11 | $ | 202,865 | $ | 472,759 | ||||||||||||||
9,655 | (4)(8) | 1.32% | $ | 64.01 | 10/29/11 | $ | 251,590 | $ | 586,319 | |||||||||||||||
Edward Tenholder | 6,630 | (3)(4) | 0.9% | $ | 75.16 | 3/5/11 | $ | 202,865 | $ | 472,759 |
(1) | Total options granted to employees in fiscal year 2004 includes all options granted to employees in 2004. |
(2) | The values in these columns are based upon calculations assuming the 5% and 10% annual stock price appreciation rate specified by the Securities and Exchange Commission. These assumed rates are not intended to forecast future price appreciation of the common stock. Actual gains, if any, on stock option exercises are dependent upon the future market performance of the common stock and the date on which the options are exercised. |
(3) | Consists of options awarded on March 5, 2004 and vesting at 331/3% per year on each of the first three anniversaries of the date of grant. |
(4) | In the event of a “change in control” of the Company (as defined in the 2000 LTIP), the options will become fully vested and exercisable. Afterwards, if there is no public market for the Company’s stock, or the common stock for which the Company’s common stock is exchanged, then any unexercised options will be repurchased by the Company based on the “change in control price” (as defined) for the underlying shares. The options become fully exercisable for one year upon termination of employment if the employee dies, becomes disabled, or retires. The options expire if the employee is terminated for cause, and if the employee is terminated for any other reason, the options are exercisable, to the extent that they were exercisable before termination, for one month. The foregoing terms are subject to the terms of the employment agreements of the Named Officers. See “Employment Agreements” below. |
(5) | Represents the closing price per share as reported on Nasdaq on the date of grant, which represent the fair market value on the date of the grant as defined in the applicable stock option plan. |
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(6) | Consists of options awarded on February 10, 2004, pursuant to Mr. Paz’s employment agreement with the Company, and vesting at 331/3% per year on December 31, 2004, 2005 and 2006. |
(7) | Consists of options awarded on August 31, 2004, pursuant to Mr. Lowenberg’s employment agreement with the Company, and vesting on December 31, 2010, provided that vesting may be accelerated if certain performance targets are achieved for fiscal 2004 and 2005. |
(8) | Consists of options awarded on October 29, 2004, pursuant to Mr. Boudreau’s employment agreement with the Company, and vesting on December 31, 2010, provided that vesting may be accelerated if certain performance targets are achieved for fiscal 2004 and 2005. |
Number of Securities | ||||||||||||||||
Underlying Unexercised | Value of Unexercised | |||||||||||||||
Options at | In-the-Money Options | |||||||||||||||
Shares | Fiscal Year End(#) | at Fiscal Year End ($) | ||||||||||||||
Acquired on | Value | Exercisable/ | Exercisable/ | |||||||||||||
Name | Exercise (#) | Realized ($)(1) | Unexercisable | Unexercisable(2) | ||||||||||||
Barrett A. Toan | 0 | N/A | 646,534/43,766 | $49,421,059/$3,345,473 | ||||||||||||
George Paz | 0 | N/A | 143,434/36,457 | $10,964,095/$2,786,773 | ||||||||||||
David A. Lowenberg | 0 | N/A | 90,587/31,254 | $6,924,470/$2,389,056 | ||||||||||||
Thomas M. Boudreau | 0 | N/A | 86,800/19,285 | $6,634,992/$1,474,145 | ||||||||||||
Edward Tenholder | 45,667 | $1,446,615 | 12,333/17,963 | $942,735/$1,373,092 |
(1) | Based on the difference between the sale price and the exercise price. |
(2) | Based on $76.44, the closing price of the Common Stock as reported on Nasdaq on December 31, 2004. On March 31, 2005, the closing price of the Common Stock was $87.19. |
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— | Mr. Paz will be entitled to all previously earned and accrued, but unpaid, annual base salary. | |
— | If Mr. Paz’s employment is terminated by the Company other than for Cause or Disability, or by Mr. Paz for Good Reason (as those terms are defined in the agreement), Mr. Paz is entitled to receive: (i) a pro rata portion of the restricted stock award under the 2004 agreement based on the number of days worked during the employment period under the 2004 agreement; (ii) a severance benefit equal to 18 months of his base salary plus a specified portion of his bonus potential for the year based on the average percentage of the potential earned for the three prior years; (iii) reimbursement for the cost of continuing medical insurance for Mr. Paz, his spouse and any eligible dependents for 36 months after termination of employment; and (iv) a pro rata portion of the deferred bonus based on the number of days worked during the initial employment period. |
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— | If Mr. Paz’s employment terminates on account of Disability or retirement (i.e., voluntary retirement on or after age 591/2 but not within 90 days after a change in control (as defined in the employment agreement) of the Company) prior to the end of his employment period under the agreement, Mr. Paz generally is entitled to receive (i) a certain percentage of the restricted stock award calculated pursuant to the terms of the agreement, (ii) a pro rata portion of the deferred bonus, and (iii) reimbursement for the cost of continuing medical insurance for Mr. Paz, his spouse and any eligible dependents for 36 months after termination of employment. | |
— | If Mr. Paz’s employment terminates on account of death prior to the end of his employment period under the agreement, Mr. Paz’s estate generally is entitled to receive (i) 100% of the restricted stock award calculated pursuant to the terms of the agreement, (ii) 100% of the deferred bonus, and (iii) reimbursement for the cost of continuing medical insurance for Mr. Paz’ spouse and any eligible dependents for 36 months after termination of employment. |
• | Agreement with Mr. Lowenberg. On August 31, 2004, the Company entered into a long-term employment agreement with Mr. Lowenberg, replacing a previous agreement which was entered into in March 2001. The initial employment period under the agreement runs from the effective date through March 31, 2006, and the employment period is automatically extended for successive one-year renewal periods unless either party gives timely notice of non-renewal. |
Mr. Lowenberg’s employment agreement generally provides for: (i) the payment of an annual base salary of $450,000 (which may not be reduced after any increase); (ii) a guaranteed minimum annual bonus target of 70% of Mr. Lowenberg’s base salary pursuant to the terms of the Company’s bonus plan, with a bonus opportunity for each calendar year during the initial employment period of up to 200% of the Mr. Lowenberg’s guaranteed minimum annual bonus in the event the Company achieves certain “stretch” financial and work plan goals; (iii) a grant under the 2000 LTIP of an option to purchase 17,554 shares of the Common Stock, scheduled to vest in full on December 31, 2010, but subject to accelerated vesting upon the achievement of certain financial goals; (iv) an award of 14,451 shares of restricted stock award under the 2000 LTIP, scheduled to vest in full on August 31, 2011, but subject to accelerated vesting upon the achievement of certain financial goals; (v) participation in Company employee benefit plans (other than bonus and incentive plans) on the same basis as such plans are |
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generally made available to similarly situated senior executives of the Company; (vi) such perquisites and fringe benefits to which similarly situated executives of the Company are entitled and which are suitable for Mr. Lowenberg’s position; (vii) the crediting of a deferred bonus of $600,000 (to be credited in two annual installments of $300,000 each) to Mr. Lowenberg’s retirement account in the EDCP, subject to the terms and conditions of the EDCP, which bonus generally vests at the end of the Mr. Lowenberg’s initial employment period under the employment agreement, subject to certain exceptions; and (viii) a one time bonus in the amount necessary to make his annual salary effective as of January 1, 2004. | |
If Mr. Lowenberg’s employment is terminated prior to the expiration of the employment period (including any renewal period in effect) he is not entitled to receive any further payments or benefits that have not already been paid or provided (including any unvested portion of the option grant or restricted stock award) except as follows: |
— | Mr. Lowenberg will be entitled to all previously earned and accrued, but unpaid, annual base salary. | |
— | If Mr. Lowenberg’s employment is terminated by the Company other than for Cause or Disability, or by Mr. Lowenberg for Good Reason (as those terms are defined in the agreement), Mr. Lowenberg is entitled to receive: (i) a severance benefit equal to 18 months of his base salary plus a specified portion of Mr. Lowenberg’s bonus potential for the year based on the average percentage of the potential earned for the three prior years; (ii) reimbursement for the cost of continuing medical insurance under COBRA for 18 months after termination of employment; (iii) if termination of employment occurs prior to the end of Mr. Lowenberg’s initial employment period under the agreement, a pro rata portion of 83% of the restricted stock award based on the number of days worked during the initial employment period); (iv) if termination of employment occurs prior to the end of Mr. Lowenberg’s initial employment period under the agreement, a pro rata portion of the previously credited installment(s) of the deferred bonus based on the number of days worked during the initial employment period. | |
— | If Mr. Lowenberg’s employment terminates on account of Disability or retirement (i.e., voluntary retirement on or after age 591/2 but not within 90 days after a change in control (as defined in the employment agreement) of the Company) prior to the end of Mr. Lowenberg’s initial employment period under the agreement, Mr. Lowenberg generally is entitled to receive a pro rata portion of the previously credited installment(s) of the deferred bonus. | |
— | If Mr. Lowenberg’s employment terminates on account of death prior to the end of his initial employment period under the agreement, he generally is entitled to receive: (i) 83% of the restricted stock award, and (ii) a pro rata portion of the previously credited installment(s) of the deferred bonus. | |
— | Mr. Lowenberg’s rights with respect to the stock options granted under the employment agreement are generally governed by the terms and provisions of the 2000 LTIP. However, the employment agreement provides that stock options granted thereunder shall not vest or otherwise become exercisable solely as a result of Mr. Lowenberg’s retirement. | |
— | If a change in control (as defined in the agreement) of the Company occurs prior to the end of the initial employment period under the agreement, Mr. Lowenberg, in certain instances, is afforded different rights with respect to the deferred bonus as follows: (i) if Mr. Lowenberg remains employed for 90 days following the change in control, he obtains a vested right to receive 50% of the deferred bonus, with the remaining 50% otherwise eligible for vesting pursuant to the terms of the employment agreement; and (ii) if, within 90 days before or at any time after a change in control, Mr. Lowenberg is terminated by the Company other than for Cause or Disability, or by Mr. Lowenberg for Good Reason, or the agreement expires during the 90 days following the change in control, Mr. Lowenberg would generally obtain a vested right to receive 100% of the deferred bonus. |
If Mr. Lowenberg’s employment is terminated prior to expiration of the employment period (including any renewal period in effect) for any reason, Mr. Lowenberg is prohibited from competing against the Company for 18 months after such termination. If termination of employment occurs solely as a result of expiration of the employment agreement, Mr. Lowenberg is prohibited from competing for one year after such termination. Mr. Lowenberg is also subject to certain non-solicitation and non-disclosure limitations. Entitlement to the severance benefit and the deferred bonus described above (including any prorated portion) is contingent upon compliance with these restrictive covenants. |
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In the event that any amount or benefit paid or distributed to Mr. Lowenberg pursuant to the employment agreement, taken together with any amounts or benefits otherwise paid or distributed to Mr. Lowenberg by the Company pursuant to any other arrangement or plan (collectively, the “Covered Payments”), would result in Mr. Lowenberg’s liability for the payment of an Excise Tax, the Company will make a “gross-up” payment to Mr. Lowenberg to fully offset the Excise Tax provided the aggregate present value of the Covered Payments is equal to or exceeds 125% of the maximum total payment which could be made to Mr. Lowenberg without triggering the Excise Tax. If the aggregate present value of the Covered Payments, however, exceeds such maximum amount, but is less than 125% of such maximum amount, then the Company may, in its discretion, reduce the Covered Payments so that no portion of the Covered Payments is subject to the Excise Tax, and no gross-up payment would be made. |
• | Agreement with Mr. Boudreau. On October 29, 2004, the Company entered into a long-term employment agreement with Mr. Boudreau, replacing a previous agreement which was entered into in March 2001. The initial employment period under the agreement runs from the effective date through March 31, 2006, and the employment period is automatically extended for successive one-year renewal periods unless either party gives timely notice of non-renewal. |
Mr. Boudreau’s employment agreement generally provides for: (i) the payment of an annual base salary of $350,000 (which may not be reduced after any increase); (ii) a guaranteed minimum annual bonus target of 64% of Mr. Boudreau’s base salary pursuant to the terms of the Company’s bonus plan, with a bonus opportunity for each calendar year during the initial employment period of up to 200% of the Mr. Boudreau’s guaranteed minimum annual bonus in the event the Company achieves certain “stretch” financial and work plan goals; (iii) a grant under the 2000 LTIP of an option to purchase 9,655 shares of the Common Stock, scheduled to vest in full on December 31, 2010, but subject to accelerated vesting upon the achievement of certain financial goals; (iv) an award of 7,226 shares of restricted stock award under the 2000 LTIP, scheduled to vest in full on August 31, 2011, but subject to accelerated vesting upon the achievement of certain financial goals; (v) participation in Company employee benefit plans (other than bonus and incentive plans) on the same basis as such plans are generally made available to similarly situated senior executives of the Company; (vi) such perquisites and fringe benefits to which similarly situated executives of the Company are entitled and which are suitable for Mr. Boudreau’s position; (vii) the crediting of a deferred bonus of $400,000 (to be credited in two annual installments of $200,000 each) to Mr. Boudreau’s retirement account in the EDCP, subject to the terms and conditions of the EDCP, which bonus generally vests at the end of the Mr. Boudreau’s initial employment period under the employment agreement, subject to certain exceptions; (viii) a one time bonus in the amount necessary to make his annual salary effective as of January 1, 2004; and (ix) a one time signing bonus in the amount of $100,000 (to be paid in two equal installments of $50,000 each). | |
If Mr. Boudreau’s employment is terminated prior to the expiration of the employment period (including any renewal period in effect) he is not entitled to receive any further payments or benefits that have not already been paid or provided (including any unvested portion of the option grant or restricted stock award) except as follows: |
— | Mr. Boudreau will be entitled to all previously earned and accrued, but unpaid, annual base salary. | |
— | If Mr. Boudreau’s employment is terminated by the Company other than for Cause or Disability, or by Mr. Boudreau for Good Reason (as those terms are defined in the agreement), Mr. Boudreau is entitled to receive: (i) a severance benefit equal to 18 months of his base salary plus a specified portion of Mr. Boudreau’s bonus potential for the year based on the average percentage of the potential earned for the three prior years; (ii) reimbursement for the cost of continuing medical insurance under COBRA for 18 months after termination of employment; (iii) if termination of employment occurs prior to the end of Mr. Boudreau’s initial employment period under the agreement, a pro rata portion of 83% of the restricted stock award based on the number of days worked during the initial employment period); (iv) if termination of employment occurs prior to the end of Mr. Boudreau’s initial employment period under the agreement, a pro rata portion of the previously credited installment(s) of the deferred bonus based on the number of days worked during the initial employment period. | |
— | If Mr. Boudreau’s employment terminates on account of disability or retirement (i.e., voluntary retirement on or after age 591/2 but not within 90 days after a change in control (as defined in the employment agreement) of the Company) prior to the end of Mr. Boudreau’s initial employment period under the agreement, |
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Mr. Boudreau generally is entitled to receive a pro rata portion of the previously credited installment(s) of the deferred bonus. | ||
— | If Mr. Boudreau’s employment terminates on account of death prior to the end of his initial employment period under the agreement, he generally is entitled to receive: (i) 83% of the restricted stock award, and (ii) a pro rata portion of the previously credited installment(s) of the deferred bonus. | |
— | Mr. Boudreau’s rights with respect to the stock option granted under the employment agreement are generally governed by the terms and provisions of the 2000 LTIP. However, the employment agreement provides that stock options granted thereunder shall not vest or otherwise become exercisable solely as a result of Mr. Boudreau’s retirement. | |
— | If a change in control (as defined in the agreement) of the Company occurs prior to the end of the initial employment period under the agreement, Mr. Boudreau, in certain instances, is afforded different rights with respect to the deferred bonus as follows: (i) if Mr. Boudreau remains employed for 90 days following the change in control, he obtains a vested right to receive 50% of the deferred bonus, with the remaining 50% otherwise eligible for vesting pursuant to the terms of the employment agreement; and (ii) if, within 90 days before or at any time after a change in control, Mr. Boudreau is terminated by the Company other than for Cause or Disability, or by Mr. Boudreau for Good Reason, or the agreement expires during the 90 days following the change in control, Mr. Boudreau would generally obtain a vested right to receive 100% of the deferred bonus. |
If Mr. Boudreau’s employment is terminated prior to expiration of the employment period (including any renewal period in effect) for any reason, Mr. Boudreau is prohibited from competing against the Company for 18 months after such termination. If termination of employment occurs solely as a result of expiration of the employment agreement, Mr. Boudreau is prohibited from competing for one year after such termination. Mr. Boudreau is also subject to certain non-solicitation and non-disclosure limitations. Entitlement to the severance benefit and the deferred bonus described above (including any prorated portion) is contingent upon compliance with these restrictive covenants. | |
In the event that any amount or benefit paid or distributed to Mr. Boudreau pursuant to the employment agreement, taken together with any amounts or benefits otherwise paid or distributed to Mr. Boudreau by the Company pursuant to any other arrangement or plan (collectively, the “Covered Payments”), would result in Mr. Boudreau’s liability for the payment of an Excise Tax, the Company will make a “gross-up” payment to Mr. Boudreau to fully offset the Excise Tax provided the aggregate present value of the Covered Payments is equal to or exceeds 125% of the maximum total payment which could be made to Mr. Boudreau without triggering the Excise Tax. If the aggregate present value of the Covered Payments, however, exceeds such maximum amount, but is less than 125% of such maximum amount, then the Company may, in its discretion, reduce the Covered Payments so that no portion of the Covered Payments is subject to the Excise Tax, and no gross-up payment would be made. |
• | Agreement with Mr. Tenholder. On October 7, 2002, the Company entered into a long-term employment agreement with Mr. Tenholder. The initial employment period under the agreement runs from the effective date through December 31, 2006, and the employment period is automatically extended for successive one-year renewal periods unless either party gives timely notice of non-renewal. |
Mr. Tenholder’s employment agreement generally provides for: (i) the payment of an annual base salary of $300,000 (which may not be reduced after any increase); (ii) a guaranteed minimum annual bonus target of 55% of Mr. Tenholder’s base salary pursuant to the terms of the Company’s bonus plan, with a bonus opportunity for each calendar year during the initial employment period of up to 200% of the Mr. Tenholder’s guaranteed minimum annual bonus in the event the Company achieves certain “stretch” financial and work plan goals; (iii) a grant under the 2000 LTIP of an option to purchase 16,000 shares of the Common Stock, vesting in three equal increments on December 31, 2004, 2005 and 2006; (iv) an award of 9,000 shares of restricted stock award under the 2000 LTIP, scheduled to vest in full on December 31, 2006, (v) participation in Company employee benefit plans (other than bonus and incentive plans) on the same basis as such plans are generally made available to similarly situated senior executives of the Company; (vi) such perquisites and fringe benefits to which similarly situated executives of the Company are entitled and which are suitable for Mr. Tenholder’s position; and (vii) the crediting of a deferred bonus of $500,000 to Mr. Tenholder’s retirement account in the EDCP, subject to the terms |
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and conditions of the EDCP, which bonus generally vests at the end of the Mr. Tenholder’s initial employment period under the employment agreement, subject to certain exceptions. | |
If Mr. Tenholder’s employment is terminated prior to the expiration of the employment period (including any renewal period in effect) he is not entitled to receive any further payments or benefits that have not already been paid or provided (including any unvested portion of the option grant or restricted stock award) except as follows: |
— | Mr. Tenholder will be entitled to all previously earned and accrued, but unpaid, annual base salary. | |
— | If Mr. Tenholder’s employment is terminated by the Company other than for Cause or Disability, or by Mr. Tenholder for Good Reason (as those terms are defined in the agreement), Mr. Tenholder is entitled to receive: (i) a severance benefit equal to 18 months of his base salary plus a specified portion of Mr. Tenholder’s bonus potential for the year based on the average percentage of the potential earned for the three prior years; (ii) reimbursement for the cost of continuing medical insurance under COBRA for 18 months after termination of employment; (iii) if termination of employment occurs prior to the end of Mr. Tenholder’s initial employment period under the agreement, a pro rata portion of the restricted stock award based on the number of days worked during the initial employment period); (iv) if termination of employment occurs prior to the end of Mr. Tenholder’s initial employment period under the agreement, a pro rata portion of the deferred bonus based on the number of days worked during the initial employment period. | |
— | If Mr. Tenholder’s employment terminates on account of death, Disability or retirement (i.e., voluntary retirement on or after age 591/2 but not within 90 days after a change in control (as defined in the employment agreement) of the Company) prior to the end of Mr. Tenholder’s initial employment period under the agreement, Mr. Tenholder generally is entitled to receive (i) if termination of employment occurs prior to the end of Mr. Tenholder’s initial employment period under the agreement, a pro rata portion of the restricted stock award based on the number of days worked during the initial employment period); and (ii) if termination of employment occurs prior to the end of Mr. Tenholder’s initial employment period under the agreement, a pro rata portion of the deferred bonus based on the number of days worked during the initial employment. | |
— | Mr. Tenholder’s rights with respect to the stock option granted under the employment agreement are generally governed by the terms and provisions of the 2000 LTIP. However, the employment agreement provides that stock options granted on or after the effective date of the employment agreement (including stock options granted under the employment agreement) which have vested as of the effective date of termination of employment will be exercisable until (i) expiration of the relevant option term if termination is on account of retirement, or (ii) 12 months after termination of employment if termination is solely on account of the Company’s decision not to renew the employment agreement. | |
— | If a change in control (as defined in the agreement) of the Company occurs prior to the end of the initial employment period under the agreement, Mr. Tenholder, in certain instances, is afforded different rights with respect to the deferred bonus as follows: (i) if Mr. Tenholder remains employed for 90 days following the change in control, he obtains a vested right to receive 50% of the deferred bonus, with the remaining 50% otherwise eligible for vesting pursuant to the terms of the employment agreement; and (ii) if, within 90 days before or at any time after a change in control, Mr. Tenholder is terminated by the Company other than for Cause or Disability, or by Mr. Tenholder for Good Reason, or the agreement expires during the 90 days following the change in control, Mr. Tenholder would generally obtain a vested right to receive 100% of the deferred bonus. |
If Mr. Tenholder’s employment is terminated prior to expiration of the employment period (including any renewal period in effect) for any reason, Mr. Tenholder is prohibited from competing against the Company for 18 months after such termination. If termination of employment occurs solely as a result of expiration of the employment agreement, Mr. Tenholder is prohibited from competing for one year after such termination. Mr. Tenholder is also subject to certain non-solicitation and non-disclosure limitations. Entitlement to the severance benefit and the deferred bonus described above (including any prorated portion) is contingent upon compliance with these restrictive covenants. | |
In the event that any amount or benefit paid or distributed to Mr. Tenholder pursuant to the employment agreement, taken together with any amounts or benefits otherwise paid or distributed to Mr. Tenholder by the Company pursuant to any other arrangement or plan (collectively, the “Covered Payments”), would result in Mr. Tenholder’s liability for the payment of an Excise Tax, the Company will make a “gross-up” payment to |
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Mr. Tenholder to fully offset the Excise Tax provided the aggregate present value of the Covered Payments is equal to or exceeds 125% of the maximum total payment which could be made to Mr. Tenholder without triggering the Excise Tax. If the aggregate present value of the Covered Payments, however, exceeds such maximum amount, but is less than 125% of such maximum amount, then the Company may, in its discretion, reduce the Covered Payments so that no portion of the Covered Payments is subject to the Excise Tax, and no gross-up payment would be made. |
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2004 | 2003 | |||||||
Audit fees(1) | $ | 1,615,659 | $ | 820,208 | ||||
Audit-related fees(2) | 184,775 | 163,094 | ||||||
Tax fees(3) | 146,605 | 427,601 | ||||||
All other fees(4) | 1,500 | 1,400 | ||||||
Total Fees | $ | 1,948,539 | $ | 1,412,303 | ||||
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(1) | Audit fees are fees paid for professional services rendered for the audit of the Company’s annual consolidated financial statements, for reviews of the Company’s interim consolidated financial statements, and for the audit of internal controls over financial reporting. Audit fees also include fees for work generally only the independent auditor can be expected to provide such as services associated with documents filed with the SEC and with assistance in responding to SEC comment letters, as well as reports on internal control reviews required by regulators. |
(2) | Audit-related fees are fees paid for assurance and related services performed by the Company’s independent auditors including due diligence services related to contemplated mergers and acquisitions, internal control reviews not required by regulators, and employee benefit plan audits. The 2003 fees included approximately $60,000 related to preliminary attestation services which are expected to benefit the 2004 attestation of the Company’s internal controls over financial reporting, as mandated by the Sarbanes-Oxley Act of 2002. |
(3) | Tax fees are fees paid for tax compliance, tax planning and tax advice. During 2003, the Company implemented a policy regarding pre-approval of services provided by the independent auditors. In conjunction with the policy, PricewaterhouseCoopers LLP is prohibited from performing tax services with the exception of the completion of previously approved tax projects. The tax fees paid in 2003 and 2004 were for projects that began in 2002. |
(4) | All other fees includes any fees earned for services rendered by PricewaterhouseCoopers LLP during 2003 and 2004 which are not included in any of the above categories. The other fees for 2004 and 2003 consist of licensing fees paid by the Company with respect to certain accounting research software. |
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By Order of the Board of Directors | |
![]() | |
Thomas M. Boudreau | |
Senior Vice President, General Counsel and Secretary |
30
April 22, 2005
Dear Stockholder:
The Annual Meeting of Stockholders of Express Scripts, Inc. will be held at the offices of the Company, 13900 Riverport Drive, Maryland Heights, Missouri 63043, at 9:30 a.m. on Wednesday, May 25, 2005.
It is important that your shares be represented at this meeting. Whether or not you plan to attend the meeting, please review the enclosed proxy materials, vote by telephone or the Internet or execute the attached proxy form below, and return it promptly in the envelope provided.
PROXY VOTING INSTRUCTIONS
TO VOTE BY MAIL
Please date, sign and mail your proxy card in the envelope provided as soon as possible.
TO VOTE BY TELEPHONE (TOUCH-TONE PHONE ONLY)
Please call toll-free 1-800-PROXIES and follow the instructions. Have your control number and the proxy card available when you call.
TO VOTE BY INTERNET
Please access the web page at “www.voteproxy.com” and follow the on-screen instructions. Have your control number available when you access the web page.
YOUR CONTROL NUMBER ISè | ||
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þ Please Detach and Mail in the Envelope Providedþ
X | Please mark your votes as in this example. | |
o | FOR ALL THE NOMINEES LISTED BELOW (except as marked to the contrary below) | o | WITHHOLD AUTHORITY TO VOTE FOR ALL NOMINEES LISTED BELOW |
NOMINEES: | ||
GARY G. BENANAV | ||
FRANK J. BORELLI | GEORGE PAZ | |
MAURA C. BREEN | SAMUEL K. SKINNER | |
NICHOLAS J. LaHOWCHIC | SEYMOUR STERNBERG | |
THOMAS P. Mac MAHON | BARRETT A. TOAN | |
JOHN O. PARKER, JR. | HOWARD L. WALTMAN |
INSTRUCTION: To withhold authority to vote for any individual nominee, print that nominee’s name below.
For | Against | Abstain | ||||||
(2) | Ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent accountants for 2005. | o | o | o |
This Proxy will be voted “FOR” items 1 and 2 if no instruction to the contrary is indicated. If any other business is properly presented at the meeting, the Proxy will be voted in accordance with the recommendation of management.
(YOU ARE REQUESTED TO COMPLETE, SIGN AND RETURN THIS PROXY PROMPTLY)
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EXPRESS SCRIPTS, INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS — MAY 25, 2005
The undersigned hereby appoints George Paz and David Lowenberg, or either one of them, as attorneys-in-fact, agents and proxies for the undersigned with full power of substitution, to vote all shares of the Common Stock of the undersigned in Express Scripts, Inc. (the “Company”) at the Annual Meeting of Stockholders of the Company to be held on May 25, 2005 at 9:30 A.M., at the offices of the Company, 13900 Riverport Drive, Maryland Heights, Missouri 63043, or at any adjournment or postponement thereof, upon the matters described in the Notice of such meeting and accompanying Proxy Statement, receipt of which is acknowledged, and upon such other business as may properly come before the meeting or any adjournments or postponements thereof, hereby revoking any proxies heretofore given. Please sign exactly as the name(s) appear on this proxy card. When shares are held by joint tenants, both should sign. When signing as attorney-in-fact, executor, administrator, personal representative, trustee or guardian, please give full title as such. If a corporation, please sign in full corporate name by President or other authorized officers. If a partnership, please sign in partnership name by authorized persons.
Dated: | _________________________ | _______________________________ | |
(Signature) | |||
_______________________________ | |||
(Signature if held jointly) |