UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] | Preliminary Proxy Statement | |||||
[ ] | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) | |||||
[X] | Definitive Proxy Statement | |||||
[ ] | Definitive Additional Materials | |||||
[ ] | Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-2. |
TIFFANY & CO.
Payment of Filing Fee (Check the appropriate box):
[X] | No fee required. |
[ ] | Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-12. |
(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): |
(4) | Proposed maximum aggregate value of transaction: |
(5) | Total fee paid: |
[ ] | Fee paid previously with preliminary materials. | |
[ ] | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
(1) | Amount Previously Paid: |
(2) | Form, Schedule or Registration Statement No.: |
(3) | Filing Party: |
(4) | Date Filed: |
727 Fifth Avenue, New York, New York 10022, on our website athttp://investor.tiffany.com and you will find additional information concerning some of the subjects addressed in this document.
Important Notice Regarding Internet Availability of Proxy Materials
for the Stockholder Meeting to be Held on May 15, 2008.
are available athttp://bnymellon.mobular.net/bnymellon/tif
• | The election of the Board; | ||
• | Ratification of the selection of the independent registered public accounting firm to audit our Fiscal 2008 financial statements; and | ||
• | Approval of the Tiffany & Co. 2008 Directors Equity Compensation Plan. |
TIFFANY & CO.
PS-2
• | Complete the enclosed form, called a “proxy card,” and mail it in the envelope provided, or | ||
• | Call the telephone number listed on the proxy card (1-866-540-5760) and follow the pre-recorded instructions, or | ||
• | Use the Internet to vote by pointing your browser tohttp://www.proxyvoting.com/tif ; have your proxy card in hand as you will be prompted to enter your control number and to create and submit an electronic vote. |
• | You can send an executed, later-dated proxy card to the Secretary of the Company, call in different instructions, or access the Internet voting site. | ||
• | You can notify the Secretary of the Company in writing that you wish to revoke your proxy, or | ||
• | You can attend the Annual Meeting and vote in person. |
TIFFANY & CO.
PS-3
• | The stockholder who owns the share is present at the Annual Meeting, whether or not he or she chooses to cast a ballot on any proposal; or | ||
• | The stockholder is represented by proxy at the Annual Meeting. |
• | The stockholder withholds his or her vote or marks “abstain” for one or more proposals; or | ||
• | There is a “broker non-vote” on one or more proposals. |
TIFFANY & CO.
PS-4
• | FOR the election of all nine nominees for director named in this Proxy Statement; | ||
• | FOR the ratification of the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm to examine our Fiscal 2008 financial statements; and | ||
• | FOR the approval of the Tiffany & Co. 2008 Directors Equity Compensation Plan. |
TIFFANY & CO.
PS-5
Name and Address | Amount and Nature | Percent | ||||||
of Beneficial Owner | of Beneficial Ownership (a) | of Class | ||||||
Trian Fund Management, L.P. | 10,718,600 | (b) (c) | 8.50 | % | ||||
280 Park Avenue, 41st Floor | ||||||||
New York, NY 10017 | ||||||||
OppenheimerFunds, Inc. | 9,325,175 | (d) | 7.40 | % | ||||
Two World Financial Center | ||||||||
225 Liberty Street | ||||||||
New York, NY 10281 | ||||||||
Janus Capital Management LLC | 8,267,264 | (e) | 6.56 | % | ||||
151 Detroit Street | ||||||||
Denver, CO 80206 | ||||||||
a) | “Beneficial ownership” is a term broadly defined by the SEC and includes more than the typical form of stock ownership, that is, stock held in the person’s name. The term also includes what is referred to as “indirect ownership” such as where, for example, the person has or shares the power to vote the stock, sell it or acquire it within 60 days. Accordingly, some of the shares reported as beneficially owned in this table may actually be held by other persons or organizations. Those other persons and organizations are described in the reports filed with the SEC. | |
b) | The “Filing Persons” discussed below reported such beneficial ownership to the SEC on their Schedule 13D as of January 15, 2008 and that they shared voting power and shared dispositive power with respect to such shares. According to said Schedule 13D, the Filing Persons are Trian Partners GP, L.P., Trian Partners General Partner, LLC, Trian Partners, L.P., Trian Partners Master Fund, L.P., a Cayman Islands limited partnership, Trian Partners Parallel Fund I., L.P., Trian Partners Parallel Fund I General Partner LLC, Trian Partners Parallel Fund II L.P., Trian Partners Parallel Fund II GP, L.P., Trian Partners Parallel Fund II General Partner, LLC, Trian Fund Management, L.P., Trian Fund Management GP, LLC, Nelson Peltz, Peter W. May and Edward P. Garden. | |
c) | Peter W. May, referred to in Note (b) above, is a nominee of the Board for election as a director. See Item 1 — Election of Directors below. | |
d) | OppenheimerFunds, Inc., reported such beneficial ownership to the SEC on its Schedule 13G as of February 5, 2008 and that it has shared voting power and shared dispositive power over all such shares. | |
e) | Janus Capital Management LLC (“Janus Capital”) reported such beneficial ownership to the SEC on its Schedule 13G as of December 31, 2007 and that it had sole voting power over 3,467,380 shares, shared voting power over 4,799,884 shares, sole dispositive power over 3,467,380 shares and shared dispositive power over 4,799,884 shares. The form was also signed by Enhanced Investment Technologies LLC (“Intech”). Janus disclosed indirect ownership stakes in Intech and in Perkins, |
TIFFANY & CO.
PS-6
Wolf, McDonnell and Company, LLC (“Perkins Wolf”). Janus disclosed that, by virtue of the ownership structure disclosed, holdings in the Company’s stock by Janus, Intech and Perkins Wolf had been aggregated for purposes of its Schedule 13G and that all three of the firms whose holdings were so aggregated are registered investment advisors furnishing investment advice to various investment companies and other clients referred to in the Form as the “Managed Portfolios.” The Form notes that by virtue of its role as investment adviser or sub-adviser to the Managed Portfolios, Janus Capital may be deemed to be beneficial owner of 3,467,380 shares of the Company’s stock. The filing also notes that by virtue of its role as investment adviser or sub-adviser to the Managed Portfolios, Intech may be deemed to be beneficial owner of 4,799,884 shares of the Company’s stock. Both Intech and Janus Capital state that they have no right to receive dividends from stock held in the Managed Portfolios and disclaim ownership associated with such rights. |
TIFFANY & CO.
PS-7
Amount and Nature of | ||||||||
Name | Beneficial Ownership | Percent Of Classa | ||||||
Directors | ||||||||
Rose Marie Bravo | 96,216 | b | * | |||||
William R. Chaney | 780,500 | c | * | |||||
Gary E. Costley | 6,000 | d | * | |||||
Lawrence K. Fish | 0 | * | ||||||
Abby F. Kohnstamm | 57,000 | e | * | |||||
Michael J. Kowalski (CEO) | 1,677,000 | f | 1.3 | |||||
Charles K. Marquis | 255,812 | g | * | |||||
J. Thomas Presby | 31,900 | h | * | |||||
James E. Quinn (executive officer) | 678,262 | i | * | |||||
William A. Shutzer | 319,062 | j | * | |||||
Peter W. May | 10,718,600 | k | 8.5 | |||||
Executive Officers | ||||||||
Beth O. Canavan | 290,354 | l | * | |||||
James N. Fernandez (CFO) | 546,636 | m | * | |||||
Jon M. King | 116,931 | n | * | |||||
All executive officers and directors as a group (20 persons): | 16,584,564 | o | 13.2 | |||||
a) | An asterisk (*) is used to indicate less than 1% of the class outstanding. | |
b) | Includes 92,216 shares issuable upon the exercise of “Vested Stock Options,” which are stock options that either are exercisable as of March 20, 2008 or will become exercisable within 60 days of that date. | |
c) | Includes 192,500 shares issuable upon the exercise of Vested Stock Options, and 75,000 shares held by Mr. Chaney’s wife. Also includes 13,000 shares held by The Chaney Family Foundation of which Mr. Chaney is President. Mr. Chaney disclaims beneficial ownership of Company stock held by The Chaney Family Foundation. | |
d) | Includes 5,000 shares issuable upon the exercise of Vested Stock Options. | |
e) | Includes 55,000 shares issuable upon the exercise of Vested Stock Options. | |
f) | Includes 1,463,000 shares issuable upon the exercise of Vested Stock Options. | |
g) | Includes 133,924 shares issuable upon the exercise of Vested Stock Options. | |
h) | Includes 30,000 shares issuable upon the exercise of Vested Stock Options. | |
i) | Includes 632,125 shares issuable upon the exercise of Vested Stock Options; 137 shares credited to Mr. Quinn’s account under the Company’s Employee Profit Sharing and Retirement Savings Plan; |
TIFFANY & CO.
PS-8
j) | Includes 85,000 shares issuable upon the exercise of Vested Stock Options and 5,100 shares held by or for Mr. Shutzer’s minor child and 114,000 shares held by KJC Ltd. of which Mr. Shutzer is the sole general partner. Mr. Shutzer disclaims beneficial ownership of Company stock held by KJC Ltd. | |
k) | See Stockholders Who Own At Least Five Percent of the Company above and reference Trian Fund Management, L.P. and Peter W. May in Note b) thereto. | |
l) | Includes 281,500 shares issuable upon the exercise of Vested Stock Options and 554 shares credited to Mrs. Canavan’s account under the Company’s Employee Profit Sharing and Retirement Savings Plan. | |
m) | Includes 509,500 shares issuable upon the exercise of Vested Stock Options and 136 shares credited to Mr. Fernandez’s account under the Company’s Employee Profit Sharing and Retirement Savings Plan. | |
n) | Includes 116,500 shares issuable upon the exercise of Vested Stock Options and 431 shares credited to Mr. King’s account under the Company’s Employee Profit Sharing and Retirement Savings Plan. | |
o) | Includes 4,577,395 shares issuable upon the exercise of Vested Stock Options and 2,674 shares held in the Company’s Employee Profit Sharing and Retirement Savings Plan. |
TIFFANY & CO.
PS-9
REGISTERED PUBLIC ACCOUNTING FIRM
January 31, 2008 | January 31, 2007 | |||||||
Audit Fees | $ | 2,320,500 | $ | 2,172,750 | ||||
Audit-related Feesa | 79,250 | 73,750 | ||||||
Audit and Audit-related Fees | 2,399,750 | 2,246,500 | ||||||
Tax Feesb | 1,477,100 | 713,900 | ||||||
All Other Feesc | 16,300 | 15,100 | ||||||
Total Fees | $ | 3,893,150 | $ | 2,975,500 | ||||
a) | Audit-related fees consist principally of fees for audits of financial statements of certain employee benefit plans and other advisory services for the years ended January 31, 2008 and January 31, 2007. | ||
b) | Tax fees consist of fees for tax consultation and tax compliance services. These fees included tax filing and compliance fees of $1,090,200 for the year ended January 31, 2008 and $265,600 for the year ended January 31, 2007. | ||
c) | All other fees consist of costs for software used by the Finance Division and other advisory services for the years ended January 31, 2008 and January 31, 2007. |
TIFFANY & CO.
PS-10
• | Management succession; | ||
• | Review and approval of the annual operating plan prepared by management; | ||
• | Monitoring of performance in comparison to the operating plan; | ||
• | Review and approval of the Company’s strategic plan prepared by management; | ||
• | Consideration of topics of relevance to the Company’s ability to carry out its strategic plan; | ||
• | Review and approval of a delegation of authority by which management carries out the day-to-day operations of the Company and its subsidiaries; | ||
• | Review of the Company’s investor relations program; | ||
• | Review of the Company’s schedule of insurance coverage; and | ||
• | Review and approval of significant actions by the Company. |
TIFFANY & CO.
PS-11
TIFFANY & CO.
PS-12
Nominating/ | Percent of | |||||||||||||||||||||||
Stock | Corporate | Meetings | ||||||||||||||||||||||
Board | Audit | Compensation | Option | Governance | Attended (a) | |||||||||||||||||||
Meetings Held | 10 | 10 | 6 | 6 | 6 | |||||||||||||||||||
Meetings Attended: | ||||||||||||||||||||||||
Rose Marie Bravo | 9 | n/a | 6 | 6 | 6 | 96 | % | |||||||||||||||||
William R. Chaney | 10 | n/a | n/a | n/a | n/a | 100 | % | |||||||||||||||||
Gary E. Costley | 6 | 8 | 5 | 5 | 5 | 100 | % | |||||||||||||||||
Abby F. Kohnstamm | 10 | 7 | 6 | 6 | 6 | 97 | % | |||||||||||||||||
Charles K. Marquis | 10 | 10 | 6 | 6 | 6 | 100 | % | |||||||||||||||||
J. Thomas Presby | 10 | 10 | n/a | n/a | 6 | 100 | % | |||||||||||||||||
William A. Shutzer | 10 | n/a | n/a | n/a | n/a | 100 | % | |||||||||||||||||
Michael J. Kowalski | 10 | n/a | n/a | n/a | n/a | 100 | % | |||||||||||||||||
James E. Quinn | 9 | n/a | n/a | n/a | n/a | 90 | % | |||||||||||||||||
(a) | The percentage indicated reflects that percentage of meetings attended during the period that the director was serving as a director or on the committee indicated. Thus, Ms. Kohnstamm, who was not appointed to the Audit Committee until May 2007 has not been charged with absences from Audit Committee meetings that occurred before such appointment and Dr. Costley, who was not elected to the Board until May 2007, has not been charged with absences from the Board or committee meetings prior to his election. |
TIFFANY & CO.
PS-13
Committees Composed Entirely of Independent Directors | |||||
Audit | Nominating/Corporate Governance | ||||
J. Thomas Presby, Chair | Charles K. Marquis, Chair | ||||
Gary E. Costley | Rose Marie Bravo | ||||
Abby F. Kohnstamm | Gary E. Costley | ||||
Charles K. Marquis | Abby F. Kohnstamm | ||||
J. Thomas Presby | |||||
Compensation | Stock Option Subcommittee | ||||
Gary E. Costley, Chair | Gary E. Costley, Chair | ||||
Rose Marie Bravo | Rose Marie Bravo | ||||
Abby F. Kohnstamm | Abby F. Kohnstamm | ||||
Charles K. Marquis | Charles K. Marquis | ||||
• | Policies on the composition of the Board, | ||
• | Criteria for the selection of nominees for election to the Board, | ||
• | Nominees to fill vacancies on the Board, and | ||
• | Nominees for election to the Board. |
TIFFANY & CO.
PS-14
• | Approval of remuneration arrangements for executive officers, and | ||
• | Approval of compensation plans in which officers and employees of Tiffany are eligible to participate. |
• | Retaining and terminating the Company’s independent registered public accounting firm, reviewing the quality-control procedures and independence of such firm and evaluating their proposed audit scope, performance and fee arrangements; | ||
• | Approving in advance all audit and non-audit services to be rendered by the independent registered public accounting firm; | ||
• | Reviewing the adequacy of our system of internal financial controls over financial reporting; | ||
• | Establishing procedures for complaints regarding accounting, internal accounting controls or auditing matters; and | ||
• | Conducting a post-audit review of our financial statements and audit findings in advance of filing, and reviewing in advance proposed changes in our accounting principles. |
TIFFANY & CO.
PS-15
TIFFANY & CO.
PS-16
TIFFANY & CO.
PS-17
Gary E. Costley
Abby F. Kohnstamm
Charles K. Marquis
Members of the Audit Committee
TIFFANY & CO.
PS-18
Year Joined | ||||||
Name | Age | Position | Tiffany | |||
Michael J. Kowalski | 56 | Chairman of the Board and Chief Executive Officer | 1983 | |||
James E. Quinn | 56 | President | 1986 | |||
Beth O. Canavan | 53 | Executive Vice President | 1987 | |||
James N. Fernandez | 52 | Executive Vice President and Chief Financial Officer | 1983 | |||
Jon M. King | 51 | Executive Vice President | 1990 | |||
Victoria Berger-Gross | 52 | Senior Vice President - Human Resources | 2001 | |||
Pamela H. Cloud | 38 | Senior Vice President - Merchandising | 1994 | |||
Patrick B. Dorsey | 57 | Senior Vice President - General Counsel and Secretary | 1985 | |||
Patrick F. McGuiness | 42 | Senior Vice President - Finance | 1990 | |||
Caroline D. Naggiar | 50 | Senior Vice President - Chief Marketing Officer | 1997 | |||
John S. Petterson | 49 | Senior Vice President - Operations | 1988 | |||
TIFFANY & CO.
PS-19
TIFFANY & CO.
PS-20
Compensation Discussion and Analysis | Page PS-21 | |
Report of the Compensation Committee | Page PS-31 | |
Summary Compensation Table – Fiscal 2006 and 2007 | Page PS-32 | |
Grants of Plan-Based Awards Table – Fiscal 2007 | Page PS-35 | |
Equity Compensation Plan Information | Page PS-36 | |
Discussion of Summary Compensation Table and Grants of Plan-Based Awards | Page PS-37 | |
Outstanding Equity Awards at Fiscal Year-end Table | Page PS-41 | |
Option Exercises and Stock Vested Table – Fiscal 2007 | Page PS-44 | |
Pension Benefits Table | Page PS-45 | |
Nonqualified Deferred Compensation Table | Page PS-49 | |
Potential Payments on Termination or Change in control | Page PS-51 | |
Director Compensation Table – Fiscal 2007 | Page PS-54 |
TIFFANY & CO.
PS-21
• | to attract, motivate and retain the management talent necessary to develop and execute both short-term and strategic plans; | ||
• | to reward achievement of both short-term and long-term financial goals; and | ||
• | to link management’s interests with those of the stockholders. |
TIFFANY & CO.
PS-22
• | Like most companies, the Company’s stock price over the long term is primarily driven by growth in EPS. EPS performance is the primary determiner of vesting and no shares will vest unless a threshold level of EPS performance is achieved. | ||
• | For the three-year performance period ending January 31, 2011, the cumulative EPS goals are as follows: for threshold, $8.54; for target, $9.87; and for maximum, $10.62. | ||
• | The Company’s ROA is also likely to significantly affect its stock price over the long term. This is due, in part, to the significance of inventory and store fitting-out expenses in its business. Thus the Committee uses ROA as a supplemental indicator of management’s success in achieving sustainable earnings growth. | ||
• | The ROA goals are set by the Committee in conformance to, and as part of the process of approving, the Company’s strategic plan. | ||
• | For the three-year performance period ending January 31, 2011, the average ROA goal is 11.5%. |
TIFFANY & CO.
PS-23
TIFFANY & CO.
PS-24
• | base salary; | ||
• | target annual incentive or bonus as a percentage of salary; | ||
• | target total cash compensation (salary plus target incentive/bonus award); | ||
• | actual total cash compensation (salary plus actual incentive/bonus granted in the prior year); | ||
• | expected value of long-term incentives as a percentage of salary; | ||
• | target total direct compensation (target total cash compensation plus the expected value of long-term incentives granted in the prior year); | ||
• | actual total direct compensation (actual total cash compensation plus the expected value of long-term incentives granted in the prior year); and | ||
• | pay mix. |
• | a survey of 16 public companies in the specialty retail industry with median revenues of $2.8 billion; | ||
• | a survey of 14 public and private companies in the retail industry with median revenues of $3.2 billion; | ||
• | a general survey of 47 companies in the retail/wholesale industry with median revenues of $5.6 billion; and | ||
• | a survey of 273 companies in general industry with revenues from $1 to $6 billion. |
• | that the chief executive officer was being compensated: |
¡ | at the 50th percentile in terms of salary; | ||
¡ | below the 50th percentile in terms of target bonus annual incentive as a percentage of | ||
salary and target total cash compensation; |
TIFFANY & CO.
PS-25
¡ | between the 50th and 75th percentile in terms of long-term incentives as a percent of | ||
salary and target total direct compensation; | |||
¡ | below the 50th percentile in terms of actual total cash compensation; and | ||
¡ | between the 50th and 75th percentiles in terms of actual total direct compensation; |
• | that the named executive officers in retail-specific positions were being compensated: |
¡ | generally below the 75th percentile on all measures; | ||
¡ | in the case of one, was below the 50th percentile on all measures; | ||
¡ | in the case of one other, was below the 50th percentile on some measures; and | ||
¡ | in the case of one other, was compensated above the 75% percentile on some measures; |
• | that the chief financial officer has significant operating responsibilities beyond those typically assigned to those with this title in the surveyed companies and, for that reason, the Committee elected to compare his compensation to positions with significant operating responsibilities and determined that he was compensated below the 50th percentile on all but one measure; | ||
• | that a 5.2% increase in target total cash compensation was warranted for the chief executive officer for Fiscal 2008 — this was accomplished by increasing both salary and target annual incentive compensation; and | ||
• | that a 12.6% increase in target total cash compensation was warranted , in aggregate, for the other named executive officers — this was accomplished by increasing both salary and target annual incentive compensation for Mrs. Canavan and for Messrs. Fernandez and King. |
Target Incentive as a Percent of | Maximum Incentive as a Percent | |||||||
Executive | Base Salary | of Base Salary | ||||||
Michael J. Kowalski | 100% | 200% | ||||||
James E. Quinn | 70% | 140% | ||||||
Beth O. Canavan | 70% | 140% | ||||||
James N. Fernandez | 70% | 140% | ||||||
Jon M. King | 70% | 140% | ||||||
Executive | Long-term Incentive Value as a Percent of Salary | |||
Michael J. Kowalski | 300% | |||
James E. Quinn | 162% | |||
Beth O. Canavan | 200% | |||
James N. Fernandez | 225% | |||
Jon M. King | 200% | |||
TIFFANY & CO.
PS-26
Market Value of Company Stock Holdings as a | ||
Multiple of Base Salary (Minimum Annual Retainer | ||
Position/Level | in the case of Non-Executive Directors) | |
Chief Executive Officer | Five Times | |
Non-Executive Directors | Five Times | |
President | Four Times | |
Executive Vice President | Three Times | |
Senior Vice President | Two Times | |
• | satisfy required withholding for income taxes due upon exercise of stock options or vesting of performance-based restricted stock units; | ||
• | pay the exercise price upon exercise of stock options; and | ||
• | dispose of no more than 50% of the remaining shares issued upon exercise of stock options or vesting of performance-based restricted share units (after paying the exercise price and tax withholding). |
TIFFANY & CO.
PS-27
• | will increase the value of the Company to a potential acquirer that requires delivery of an intact management team; | ||
• | will help to keep management in place and focused should any situation arise in which a change of control looms but is not welcome or agreement has not yet been reached; | ||
• | are a prudent defense to the possibility that one or more senior executive officers might retire or take a competing job offer during a time of transition; and | ||
• | are not overly generous. |
• | the excise tax imposes discriminatory results between executives with varying compensation and stock option exercise histories; | ||
• | the gross-up provisions assure that the financial incentives provided by the retention agreements will have the desired effect upon each individual executive officer without such discriminatory results; and | ||
• | given the size of the Company’s business and its assets, the cost of the retention payments, including the gross-up payments, is unlikely to impede an acquisition offer from an acquirer with the necessary wherewithal to accomplish it. |
• | that each executive should control the disposition of his or her equity interest in the Company, and receive the full value of such interest, should a change of control situation ever arise; and | ||
• | that the independent directors are fully capable of weighing the merits of any proposed transaction and reaching a proper conclusion in the interests of the stockholders, even in the |
TIFFANY & CO.
PS-28
face of management’s advocacy of a transaction that would provide change in control payments to the executive officers. |
• | loss of benefits under the Excess Plan and the Supplemental Plan; | ||
• | loss of all rights under stock options and performance-based restricted stock units; and | ||
• | mandatory repayment of all proceeds from stock options exercised or restricted stock units vested during a period beginning six months before termination and throughout the duration of the non-competition covenant. |
• | review recommendations from management (and any consultants retained by management) and provide an additional layer of peer review to their analyses and recommendations to the Committee; | ||
• | join other consultants in explaining relevant information and provide additional feedback to the Committee; | ||
• | help the Committee to identify key issues and ask probing questions; and | ||
• | review and comment upon all plans, agreements or other documents or actions the Committee is asked to adopt or approve. |
• | they are to act independently of management; | ||
• | they are to act at the direction of the Compensation Committee; and |
TIFFANY & CO.
PS-29
• | their ongoing engagement will be determined by the Committee. |
• | salary and annual incentive award or bonus grants in prior years; | ||
• | potential threshold, target and maximum returns on unvested performance-based restricted stock unit awards and unrealized potential gains from outstanding stock options holdings, both under current conditions and under various hypothetical stock price and termination or change- in-control scenarios; | ||
• | realized gains on stock options previously exercised; | ||
• | shareholdings and progress towards compliance with stock ownership requirements; | ||
• | retirement and life insurance benefits and perquisites; | ||
• | total cash compensation (salary plus annual incentive award or bonus grant, based on potential threshold, target and maximum annual incentive or bonus awards for the current year); and | ||
• | estimated value of salary, annual incentive or bonus, unvested restricted stock units and stock options, and retirement and health benefits upon a hypothetical change in control scenario. |
TIFFANY & CO.
PS-30
Rose Marie Bravo
Abby F. Kohnstamm
Charles K. Marquis
TIFFANY & CO.
PS-31
Fiscal 2007 and Fiscal 2006
Change in | ||||||||||||||||||||||||||||||||||||
Pension | ||||||||||||||||||||||||||||||||||||
Value and | ||||||||||||||||||||||||||||||||||||
Non- | Nonquali- | |||||||||||||||||||||||||||||||||||
Equity | fied | |||||||||||||||||||||||||||||||||||
Incentive | Deferred | All | ||||||||||||||||||||||||||||||||||
Plan | Compen- | Other | ||||||||||||||||||||||||||||||||||
Stock | Option | Compen- | sation | Compen- | ||||||||||||||||||||||||||||||||
Name and | Salary | Bonus | Awards | Awards | sation | Earnings | sation | Total | ||||||||||||||||||||||||||||
Principal Position | Year | ($)(a) | ($)(b) | ($)(c) | ($)(d) | ($)(e) | ($)(f) | ($) | ($) | |||||||||||||||||||||||||||
Michael J. Kowalski | ||||||||||||||||||||||||||||||||||||
Chairman and CEO | 2007 | $ | 972,382 | --- | $ | 2,374,481 | $ | 1,397,251 | $ | 1,852,500 | $ | 370,793 | $ | 340,293(g | ) | $ | 7,307,700 | |||||||||||||||||||
2006 | $ | 972,382 | --- | $ | 1,699,300 | $ | 1,869,000 | $ | 1,123,541 | $ | 1,219,355 | $ | 153,367(h | ) | $ | 7,036,945 | ||||||||||||||||||||
James E. Quinn | ||||||||||||||||||||||||||||||||||||
President | 2007 | $ | 738,013 | --- | $ | 1,477,923 | $ | 874,052 | $ | 1,036,000 | $ | 190,821 | $ | 241,440(i | ) | $ | 4,558,249 | |||||||||||||||||||
2006 | $ | 738,013 | --- | $ | 1,058,611 | $ | 1,211,307 | $ | 628,334 | $ | 1,452,588 | $ | 119,235(j | ) | $ | 5,208,088 | ||||||||||||||||||||
Beth O. Canavan | ||||||||||||||||||||||||||||||||||||
Executive Vice | ||||||||||||||||||||||||||||||||||||
President | 2007 | $ | 528,577 | --- | $ | 827,617 | $ | 462,644 | $ | 689,000 | $ | 743,079 | $ | 160,339(k | ) | $ | 3,411,256 | |||||||||||||||||||
2006 | $ | 526,275 | --- | $ | 587,714 | $ | 656,997 | $ | 417,878 | $ | 249,113 | $ | 91,659(l | ) | $ | 2,529,636 | ||||||||||||||||||||
James N. Fernandez | ||||||||||||||||||||||||||||||||||||
Executive Vice | ||||||||||||||||||||||||||||||||||||
President and CFO | 2007 | $ | 658,228 | --- | $ | 1,165,376 | $ | 677,310 | $ | 858,000 | $ | 136,439 | $ | 214,437(m | ) | $ | 3,709,790 | |||||||||||||||||||
2006 | $ | 655,543 | --- | $ | 821,349 | $ | 946,829 | $ | 520,377 | $ | 448,086 | $ | 118,495(n | ) | $ | 3,510,679 | ||||||||||||||||||||
Jon M. King | ||||||||||||||||||||||||||||||||||||
Executive Vice | ||||||||||||||||||||||||||||||||||||
President | 2007 | $ | 498,657 | $ | 650,000 | $ | 671,302 | $ | 399,501 | --- | $ | 175,006 | $ | 149,934(o | ) | $ | 2,544,400 | |||||||||||||||||||
2006 | $ | 483,698 | $ | 394,225 | $ | 446,083 | $ | 499,315 | --- | $ | 223,538 | $ | 87,120(p | ) | $ | 2,083,979 | ||||||||||||||||||||
(a) | Salary amounts include amounts deferred at the election of the executive under the Tiffany and Company Executive Deferral Plan (the “Deferral Plan”) and under the 401(k) feature of the Company’s Employee Profit Sharing and Retirement Savings Plan (the “401(k)”). Amounts deferred to the Deferral Plan are also shown in the Nonqualified Deferred Compensation Table. | |
(b) | Bonus amounts include amounts deferred at the election of the executive under the Deferral Plan and under the 401(k). Bonus amounts are earned in the fiscal year ended January 31, and paid in April. | |
(c) | Amounts shown represent the dollar amount of compensation cost recognized for performance- based restricted stock unit awards in accordance with SFAS No. 123R. In valuing such awards, the Company made certain assumptions. For a discussion of those assumptions, please refer to Part II of the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2008. See Note M. “STOCK COMPENSATION PLANS”, in Notes to Consolidated Financial Statements, under Item 8. Financial Statements and Supplementary Data. | |
(d) | Amounts shown represent the dollar amount of compensation cost recognized for stock options in accordance with SFAS No. 123R. In valuing option awards, the Company made certain assumptions. For a discussion of those assumptions, please refer to note (c) above. | |
(e) | This column reflects cash annual incentive awards under the 2005 Employee Incentive Plan. These awards are earned in the fiscal year ended January 31 and are paid on the basis of achieved |
TIFFANY & CO.
PS- 32
Performance Goals after the release of the Company’s financial statements for the fiscal year. (For a description of the Performance Goals, see DISCUSSION OF SUMMARY COMPENSATION TABLE AND GRANTS OF PLAN-BASED AWARDS — Non-Equity Incentive Plan Awards.) This column includes amounts deferred at the election of the executive under the Deferral Plan. Amounts so deferred are also shown in the Nonqualified Deferred Compensation Table. | ||
(f) | This column represents the aggregate change, over the course of the fiscal year, in the actuarial present value of the executive’s accumulated benefit under all defined benefit and actuarial plans. This column does not include earnings under the Deferral Plan because the Deferral Plan does not pay above-market or preferential earnings on compensation that is deferred. | |
(g) | Mr. Kowalski’s Fiscal 2007 compensation included the following elements whose total incremental cost to the Company is shown in the column titled “All Other Compensation”: life insurance premium ($171,055); tax gross-up paid on the life insurance premium ($144,286); disability insurance premium ($15,952); 401(k) matching contribution ($6,500); and medical exam ($2,500). | |
(h) | Mr. Kowalski’s Fiscal 2006 compensation included the following elements whose total incremental cost to the Company is shown in the column titled “All Other Compensation”: life insurance premium ($66,542); tax gross-up paid on the life insurance premium ($54,073); disability insurance premium ($16,627); 401(k) matching contribution ($7,500); medical exam ($2,375); and tax accounting fees ($6,250). | |
(i) | Mr. Quinn’s Fiscal 2007 compensation included the following elements whose total incremental cost to the Company is shown in the column titled “All Other Compensation”: life insurance premium ($108,311); tax gross-up paid on the life insurance premium ($90,043); disability insurance premium ($17,711); 401(k) matching contribution ($6,500); tax accounting fees ($14,680); health club membership ($4,195). | |
(j) | Mr. Quinn’s Fiscal 2006 compensation included the following elements whose total incremental cost to the Company is shown in the column titled “All Other Compensation”: life insurance premium ($47,325); tax gross-up paid on the life insurance premium ($37,258); disability insurance premium ($17,386); 401(k) matching contribution ($7,500); medical exam ($2,375); tax accounting fees ($3,815); health club membership ($3,576). | |
(k) | Mrs. Canavan’s Fiscal 2007 compensation included the following elements whose total incremental cost to the Company is shown in the column titled “All Other Compensation”: life insurance premium ($71,796); tax gross-up paid on the life insurance premium ($62,918); disability insurance premium ($15,750); 401(k) matching contribution ($6,500); medical exam ($2,500); and health club membership ($875). | |
(l) | Mrs. Canavan’s Fiscal 2006 compensation included the following elements whose total incremental cost to the Company is shown in the column titled “All Other Compensation”: life insurance premium ($35,484); tax gross-up paid on the life insurance premium ($29,017); disability insurance premium ($16,579); 401(k) matching contribution ($7,500); medical exam ($2,375); and health club membership ($704). | |
(m) | Mr. Fernandez’s Fiscal 2007 compensation included the following elements whose total incremental cost to the Company is shown in the column titled “All Other Compensation”: life insurance premium ($101,927); tax gross-up paid on the life insurance premium ($84,520); |
TIFFANY & CO.
PS- 33
disability insurance premium ($17,740); 401(k) matching contribution ($6,500); and tax accounting fees ($3,750). | ||
(n) | Mr. Fernandez’s Fiscal 2006 compensation included the following elements whose total incremental cost to the Company is shown in the column titled “All Other Compensation”: life insurance premium ($52,029); tax gross-up paid on the life insurance premium ($41,322); disability insurance premium ($13,829); 401(k) matching contribution ($7,500); and tax accounting fees ($3,815). | |
(o) | Mr. King’s Fiscal 2007 compensation included the following elements whose total incremental cost to the Company is shown in the column titled “All Other Compensation”: life insurance premium ($71,602); tax gross-up paid on the life insurance premium ($54,261); disability insurance premium ($13,410); 401(k) matching contribution ($6,500); medical exam ($2,500); and health club membership ($1,631). | |
(p) | Mr. King’s Fiscal 2006 compensation included the following elements whose total incremental cost to the Company is shown in the column titled “All Other Compensation”: life insurance premium ($35,285); tax gross-up paid on the life insurance premium ($26,013); disability insurance premium ($13,010); 401(k) matching contribution ($7,500); medical exam ($2,625); and health club membership ($2,687). |
TIFFANY & CO.
PS- 34
Fiscal 2007
2005 Employee Incentive Plan
All Other | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Option | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Awards: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Number | Exercise | ||||||||||||||||||||||||||||||||||||||||||||||||||||
of | or Base | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Securities | Price of | Grant Date | |||||||||||||||||||||||||||||||||||||||||||||||||||
Under- | Option | Fair Value | |||||||||||||||||||||||||||||||||||||||||||||||||||
Estimated Future Payouts | Estimated Future Payouts | lying | Awards | of Equity | |||||||||||||||||||||||||||||||||||||||||||||||||
Grant | Under Non-Equity | Under Equity Incentive | Options | ($/Sh) | Awards | ||||||||||||||||||||||||||||||||||||||||||||||||
Name | Award Type | Date | Incentive Plan Awards | Plan Awards | (#) | (d) | (e)(f) | ||||||||||||||||||||||||||||||||||||||||||||||
Target | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Threshold | Number | Maximum | |||||||||||||||||||||||||||||||||||||||||||||||||||
Threshold | Target | Maximum | Number of | of | Number of | ||||||||||||||||||||||||||||||||||||||||||||||||
($) | ($) | ($) | Shares (a) | Shares (b) | Shares (c) | ||||||||||||||||||||||||||||||||||||||||||||||||
Annual | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Michael J. | Incentive | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Kowalski | Award | $ | 0 | $ | 1,000,000 | $ | 2,000,000 | ||||||||||||||||||||||||||||||||||||||||||||||
Performance- | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Based RSU | 1/17/08 | 20,400 | 46,000 | 80,000 | $ | 1,653,010 | |||||||||||||||||||||||||||||||||||||||||||||||
Stock Option | 1/17/08 | 101,000 | $ | 37.645 | $ | 1,477,751 | |||||||||||||||||||||||||||||||||||||||||||||||
Annual | |||||||||||||||||||||||||||||||||||||||||||||||||||||
James E. | Incentive | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Quinn | Award | $ | 0 | $ | 518,000 | $ | 1,036,000 | ||||||||||||||||||||||||||||||||||||||||||||||
Performance- | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Based RSU | 1/17/08 | 8,415 | 18,975 | 33,000 | $ | 681,867 | |||||||||||||||||||||||||||||||||||||||||||||||
Stock Option | 1/17/08 | 41,000 | $ | 37.645 | $ | 599,879 | |||||||||||||||||||||||||||||||||||||||||||||||
Annual | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Beth O. | Incentive | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Canavan | Award | $ | 0 | $ | 420,000 | $ | 840,000 | ||||||||||||||||||||||||||||||||||||||||||||||
Performance- | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Based RSU | 1/17/08 | 8,415 | 18,975 | 33,000 | $ | 681,867 | |||||||||||||||||||||||||||||||||||||||||||||||
Stock Option | 1/17/08 | 41,000 | $ | 37.645 | $ | 599,879 | |||||||||||||||||||||||||||||||||||||||||||||||
Annual | |||||||||||||||||||||||||||||||||||||||||||||||||||||
James N. | Incentive | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Fernandez | Award | $ | 0 | $ | 518,000 | $ | 1,036,000 | ||||||||||||||||||||||||||||||||||||||||||||||
Performance- | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Based RSU | 1/17/08 | 11,475 | 25,875 | 45,000 | $ | 929,818 | |||||||||||||||||||||||||||||||||||||||||||||||
Stock Option | 1/17/08 | 57,000 | $ | 37.645 | $ | 833,978 | |||||||||||||||||||||||||||||||||||||||||||||||
Annual | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Incentive | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Award | $ | 0 | $ | 420,000 | $ | 840,000 | |||||||||||||||||||||||||||||||||||||||||||||||
Jon M. | Performance- | ||||||||||||||||||||||||||||||||||||||||||||||||||||
King | Based RSU | 1/17/08 | 8,415 | 18,975 | 33,000 | $ | 681,867 | ||||||||||||||||||||||||||||||||||||||||||||||
Stock Option | 1/17/08 | 41,000 | $ | 37.645 | $ | 599,879 |
TIFFANY & CO.
PS- 35
(a) | Assumes that the EPS minimum is met and the ROA goal is not met (see DISCUSSION OF SUMMARY COMPENSATION TABLE AND GRANTS OF PLAN-BASED AWARDS — Equity Incentive Plan Awards — Performance-Based Restricted Stock Units). | |
(b) | Assumes that the EPS target is met and the ROA goal is met. | |
(c) | Assumes that the EPS maximum is met and the ROA goal is met. | |
(d) | The exercise price of all options was equal to or greater than the closing price of the underlying shares on the New York Stock Exchange on the grant date. The Committee adopted the following pricing convention on January 18, 2007: the higher of (i) the simple arithmetic mean of the high and low sales price of such stock on the New York Stock Exchange on the grant date or (ii) the closing price on such Exchange on the grant date. Options granted before that date were priced at the simple arithmetic mean of the high and low sales price of such stock on the New York Stock Exchange on the grant date. | |
(e) | The grant date fair value of each option award was computed in accordance with SFAS NO. 123R. | |
(f) | The grant date fair value of each performance-based award was computed assuming target payout and in accordance with SFAS NO. 123R. For additional information regarding performance-based compensation, see the table titled “OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END” beginning on page PS-41. |
(As of Fiscal Year 2007)
Column A | Column B | Column C | ||||||||||
Number of securities | ||||||||||||
remaining available for | ||||||||||||
Number of securities | future issuance under | |||||||||||
to be issued upon | Weighted average | equity compensation | ||||||||||
exercise of | exercise price of | plans (excluding | ||||||||||
outstanding options, | outstanding options, | securities reflected in | ||||||||||
Plan category | warrants and rights | warrants and rights | column A) | |||||||||
Equity compensation plans approved by security holders | 8,773,011 | a | $ | 32.49 | 5,999,359 | b | ||||||
Equity compensation plans not approved by security holders | 0 | 0 | 0 | |||||||||
Total | 8,773,011 | a | $ | 32.49 | 5,999,359 | b | ||||||
(a) | Shares indicated do not include 2,769,110 shares issuable under awards of stock units already made. | |
(b) | Shares indicated are the aggregate of those available for grant under the Company’s 2005 Employee Incentive Plan (the “Employee Plan”) and the Company’s 1998 Directors Option Plan (the “Directors Plan”). All plans provide for the issuance of options and stock awards. However, under the 2005 Employee Plan the maximum number of shares that may be issued, 11,000,000, is subject to reduction by 1.58 shares for each share that is delivered on vesting of a stock award. Column C reflects this reduction assuming that all shares granted as stock awards will vest. Under the Directors Plan all shares of the 412,500 remaining for issuance could be issued as stock awards. |
TIFFANY & CO.
PS- 36
AND GRANTS OF PLAN-BASED AWARDS
• | to reduce the maximum award to zero if fiscal year 2008 earnings do not equal or exceed $341,090,000; | ||
• | to reduce the maximum award to target (100% of base salary, in the case of the chief executive officer, and 70% of base salary, in the case of the other named executive officers) if fiscal year 2008 earnings do not equal or exceed $367,517,000; and | ||
• | to pay the maximum award if fiscal year 2008 earning equal or exceed $385,091,000. |
TIFFANY & CO.
PS-37
• | annual progress towards strategic plan objectives; | ||
• | business unit growth and/or profitability (where the executive officer has responsibility for such growth and/or profitability); | ||
• | organizational development; | ||
• | contributions to the working environment of his/her team and/or development of a positive working environment for employees; | ||
• | business process improvement; and | ||
• | cost containment and/or cost reduction efforts. |
• | For fiscal year 2007, earnings were required to exceed prior year earnings: |
o | in order for any annual incentive awards to pay out; | ||
o | by 12% in order to pay out at target; and | ||
o | by 16% in order to pay out at maximum. |
• | In Fiscal 2007, the Company exceeded its net earnings objectives and annual incentive awards and bonuses were paid out at 200% of the target amount. | ||
• | In Fiscal 2006, the Company exceeded its net earnings objectives and annual incentive awards and bonuses were paid out at 121.3% of target. | ||
• | In Fiscal 2005, the Company exceeded its net earning objectives and annual incentive awards and bonuses were paid out at 200% of target. |
• | Annual incentive awards are paid under the terms of the 2005 Employee Incentive Plan and will be paid only if the Company meets objective performance goals. This promise is set out in written agreements. | ||
• | Bonuses are not subject to written agreements. The Compensation Committee has the discretion to increase, decrease or withhold such bonuses. It has been the Committee’s practice to align bonuses with annual incentive awards. | ||
• | Annual incentive awards are designed so that the amounts paid out will be deductible to the Company and not count against the one million dollar limitation under Section 162(m) of the Internal Revenue Code. Each of the named executive officers is subject to that limitation. | ||
• | If a bonus is paid to an executive officer other than a named executive officer, and the total annual cash compensation paid to that executive in the year of bonus was to exceed the one million dollar limitation, the excess would not be deductible to the Company for federal income tax purposes. |
TIFFANY & CO.
PS-38
• | Units will be exchanged on a one-to-one basis for shares of the Company’s common stock when and if the Units vest; | ||
• | Vesting is determined at the end of a three-year performance period; | ||
• | No Units will vest if the executive voluntarily resigns, retires or is terminated for cause during the three-year performance period, although partial vesting is provided for in cases of termination for death or disability; | ||
• | No Units will vest (other than for reasons of death, disability or on a change in control as defined in the Retention Agreements) if the Company fails to meet a three-year cumulative EPS performance threshold set by the Compensation Committee at the time the Units are granted; | ||
• | Units will tentatively vest based on the following EPS performance hurdles: |
o | 30% at threshold; | ||
o | 50% at target; and | ||
o | 87.5% at maximum; |
• | In the event of EPS performance above threshold and below target or above target and below maximum the number of Units that tentatively vest are prorated. No Units will vest if threshold earnings performance is not achieved. After tentative vesting has been determined, a ROA test will be applied. If met, the tentatively vested number of Units will be increased by 15% (but not to over 100%); if not met, the tentatively vested number of Units will be reduced by 15%; | ||
• | 100% vesting will occur only if the Company meets both the EPS maximum and ROA goal; | ||
• | No dividends are paid, accrued or credited to Units until vesting. |
• | Threshold: cumulative net EPS of $4.59; | ||
• | Target: cumulative net EPS of $5.22; | ||
• | Maximum: cumulative net EPS of $5.45; and | ||
• | Return on assets: 8.7%. |
• | Threshold: cumulative net EPS of $5.54; | ||
• | Target: cumulative net EPS of $6.39; | ||
• | Maximum: cumulative net EPS of $6.85; | ||
• | Return on assets: 9.7%. |
• | Threshold: cumulative net EPS of $6.42; | ||
• | Target: cumulative net EPS of $7.46; | ||
• | Maximum: cumulative net EPS of $8.01; | ||
• | Return on assets: 10.4%. |
TIFFANY & CO.
PS-39
• | Threshold: cumulative net EPS of $8.54; | ||
• | Target: cumulative net EPS of $9.87; | ||
• | Maximum: cumulative net EPS of $10.62; | ||
• | Return on assets: 11.5%. |
• | Vesting of each installment is contingent on continued employment. | ||
• | All installments immediately vest if there is a change in control (as defined in the Retention Agreements), death or disability. |
• | termination of employment (three months after termination); or | ||
• | death, disability or retirement (two years after the event). |
• | executive officers own whole life policies on their own lives; | ||
• | the death benefit is three times annual salary and target annual incentive award or bonus, as the case may be; | ||
• | the Company pays the premium on such policies in an amount sufficient to accumulate cash value; | ||
• | premiums are calculated to accumulate a target cash value at age 65; | ||
• | the target cash value will allow the policy to remain in force without payment of further premiums with a death benefit equivalent to twice the executive officer’s average annual salary and target annual incentive or bonus amount; | ||
• | the amount of the premiums paid by the Company is taxable income to the executive officer; and | ||
• | the Company pays the additional amounts necessary in order to prevent the executive officer from being subjected to increased income taxes as a result of the taxable premium income. |
TIFFANY & CO.
PS-40
Option Awards | Stock Awards | |||||||||||||||||||||||||||||||
Equity | ||||||||||||||||||||||||||||||||
Equity | Incentive | |||||||||||||||||||||||||||||||
Incentive | Plan Awards | |||||||||||||||||||||||||||||||
Plan Awards | Market or | |||||||||||||||||||||||||||||||
Number | Number | Number | Payout Value | |||||||||||||||||||||||||||||
of | of | Of | Of | |||||||||||||||||||||||||||||
Securities | Securities | Unearned | Unearned | |||||||||||||||||||||||||||||
Underlying | Underlying | Shares, Units or | Shares, Units or | |||||||||||||||||||||||||||||
Unexercised | Unexercised | Option | Other Rights | Other Rights | ||||||||||||||||||||||||||||
Options | Options | Exercise | Option | That Have | That Have | |||||||||||||||||||||||||||
Exercisable | Unexercisable | Price | Expiration | Not Vested (b) | Not Vested | |||||||||||||||||||||||||||
Name | (#) | (#) | ($) | Date (a) | (#) | ($) | ||||||||||||||||||||||||||
Michael J. Kowalski | 140,000 | $ | 9.4844 | 1/14/09 | ||||||||||||||||||||||||||||
400,000 | $ | 14.9766 | 1/21/09 | |||||||||||||||||||||||||||||
150,000 | $ | 42.0782 | 1/20/10 | |||||||||||||||||||||||||||||
100,000 | $ | 32.4700 | 1/18/11 | |||||||||||||||||||||||||||||
150,000 | $ | 34.0200 | 1/16/12 | |||||||||||||||||||||||||||||
195,000 | $ | 25.8450 | 1/16/13 | |||||||||||||||||||||||||||||
180,000 | $ | 39.7500 | 1/15/14 | |||||||||||||||||||||||||||||
86,250 | 28,750 | $ | 31.4900 | 1/31/15 | ||||||||||||||||||||||||||||
42,500 | 42,500 | $ | 37.8350 | 1/31/16 | ||||||||||||||||||||||||||||
19,250 | 57,750 | $ | 40.1500 | 1/18/17 | ||||||||||||||||||||||||||||
0 | 101,000 | $ | 37.6450 | 1/17/18 | ||||||||||||||||||||||||||||
92,000 / 92,000 (c) | $ 3,660,680 (g) | |||||||||||||||||||||||||||||||
57,670 / 79,000 (d) | $ 2,294,689 (h) | |||||||||||||||||||||||||||||||
47,360 / 74,000 (e) | $ 1,884,454 (i) | |||||||||||||||||||||||||||||||
46,000 / 80,000 (f) | $ 1,830,340 (j) | |||||||||||||||||||||||||||||||
James E. Quinn | 100,000 | $ | 42.0782 | 1/20/10 | ||||||||||||||||||||||||||||
75,000 | $ | 32.4700 | 1/18/11 | |||||||||||||||||||||||||||||
110,000 | $ | 34.0200 | 1/16/12 | |||||||||||||||||||||||||||||
140,000 | $ | 25.8450 | 1/16/13 | |||||||||||||||||||||||||||||
115,000 | $ | 39.7500 | 1/15/14 | |||||||||||||||||||||||||||||
54,375 | 18,125 | $ | 31.4900 | 1/31/15 | ||||||||||||||||||||||||||||
25,500 | 25,500 | $ | 37.8350 | 1/31/16 | ||||||||||||||||||||||||||||
12,500 | 36,750 | $ | 40.1500 | 1/18/17 | ||||||||||||||||||||||||||||
0 | 41,000 | $ | 37.6450 | 1/17/18 | ||||||||||||||||||||||||||||
58,000 / 58,000 (c) | $ 2,307,820 (g) | |||||||||||||||||||||||||||||||
35,040 / 48,000 (d) | $ 1,394,242 (h) | |||||||||||||||||||||||||||||||
29,760 / 46,500 (e) | $ 1,184,150 (i) | |||||||||||||||||||||||||||||||
18,975 / 33,000 (f) | $ 755,015 (j) | |||||||||||||||||||||||||||||||
Beth O. Canavan | 50,000 | $ | 42.0782 | 1/20/10 | ||||||||||||||||||||||||||||
50,000 | $ | 32.4700 | 1/18/11 | |||||||||||||||||||||||||||||
75,000 | $ | 34.0200 | 1/16/12 | |||||||||||||||||||||||||||||
55,000 | $ | 39.7500 | 1/15/14 | |||||||||||||||||||||||||||||
30,000 | 10,000 | $ | 31.4900 | 1/31/15 | ||||||||||||||||||||||||||||
14,500 | 14,500 | $ | 37.8350 | 1/31/16 | ||||||||||||||||||||||||||||
7,000 | 21,000 | $ | 40.1500 | 1/18/17 | ||||||||||||||||||||||||||||
0 | 41,000 | $ | 37.6450 | 1/17/18 | ||||||||||||||||||||||||||||
32,000 / 32,000 (c) | $ 1,273,280 (g) | |||||||||||||||||||||||||||||||
19,710 / 27,000 (d) | $ 784,261 (h) | |||||||||||||||||||||||||||||||
16,960 / 26,500 (e) | $ 674,838 (i) | |||||||||||||||||||||||||||||||
18,975 / 33,000 (f) | $ 755,015 (j) | |||||||||||||||||||||||||||||||
TIFFANY & CO.
PS-41
Option Awards | Stock Awards | |||||||||||||||||||||||||||||||
Equity | ||||||||||||||||||||||||||||||||
Equity | Incentive | |||||||||||||||||||||||||||||||
Incentive | Plan Awards | |||||||||||||||||||||||||||||||
Plan Awards | Market or | |||||||||||||||||||||||||||||||
Number | Number | Number | Payout Value | |||||||||||||||||||||||||||||
Of | Of | Of | Of | |||||||||||||||||||||||||||||
Securities | Securities | Unearned | Unearned | |||||||||||||||||||||||||||||
Underlying | Underlying | Shares, Units or | Shares, Units or | |||||||||||||||||||||||||||||
Unexercised | Unexercised | Option | Other Rights | Other Rights | ||||||||||||||||||||||||||||
Options | Options | Exercise | �� | Option | That Have | That Have | ||||||||||||||||||||||||||
Exercisable | Unexercisable | Price | Expiration | Not Vested (b) | Not Vested | |||||||||||||||||||||||||||
Name | (#) | (#) | ($) | Date (a) | (#) | ($) | ||||||||||||||||||||||||||
James N. Fernandez | 70,000 | 101,000 | $ | 42.0782 | 1/20/10 | |||||||||||||||||||||||||||
65,000 | $ | 32.4700 | 1/18/11 | |||||||||||||||||||||||||||||
100,000 | $ | 34.0200 | 1/16/12 | |||||||||||||||||||||||||||||
118,000 | $ | 25.8450 | 1/16/13 | |||||||||||||||||||||||||||||
85,000 | $ | 39.7500 | 1/15/14 | |||||||||||||||||||||||||||||
41,250 | 13,750 | $ | 31.4900 | 1/31/15 | ||||||||||||||||||||||||||||
20,500 | 20,500 | $ | 37.8350 | 1/31/16 | ||||||||||||||||||||||||||||
9,750 | 29,250 | $ | 40.1500 | 1/18/17 | ||||||||||||||||||||||||||||
0 | 57,000 | $ | 37.6450 | 1/17/18 | ||||||||||||||||||||||||||||
44,000 / 44,000 (c) | $ 1,750,760 | (g) | ||||||||||||||||||||||||||||||
28,470 / 39,000 (d) | $ 1,132,821 | (h) | ||||||||||||||||||||||||||||||
24,000 / 37,500 (e) | $ 954,960 | (i) | ||||||||||||||||||||||||||||||
25,875 / 45,000 (f) | $ 1,029,566 | (j) | ||||||||||||||||||||||||||||||
Jon M. King | 6,000 | $ | 42.0782 | 1/20/10 | ||||||||||||||||||||||||||||
5,000 | $ | 32.4700 | 1/18/11 | |||||||||||||||||||||||||||||
7,000 | $ | 34.0200 | 1/16/12 | |||||||||||||||||||||||||||||
3,000 | $ | 35.9550 | 3/21/12 | |||||||||||||||||||||||||||||
2,500 | $ | 25.8450 | 1/16/13 | |||||||||||||||||||||||||||||
15,000 | 7,500 | $ | 25.9400 | 3/20/13 | ||||||||||||||||||||||||||||
35,000 | 11,500 | $ | 39.7500 | 1/15/14 | ||||||||||||||||||||||||||||
22,500 | 7,500 | $ | 31.4900 | 1/31/15 | ||||||||||||||||||||||||||||
11,500 | 11,500 | $ | 37.8350 | 1/31/16 | ||||||||||||||||||||||||||||
2,500 | 7,500 | $ | 33.7850 | 6/07/16 | ||||||||||||||||||||||||||||
6,500 | 19,500 | $ | 40.1500 | 1/18/17 | ||||||||||||||||||||||||||||
0 | 41,000 | $ | 37.6450 | 1/17/18 | ||||||||||||||||||||||||||||
24,000 / 24,000 (c) | $ 954,960 | (g) | ||||||||||||||||||||||||||||||
15,330 / 21,000 (d) | $ 609,981 | (h) | ||||||||||||||||||||||||||||||
16,000 / 25,000 (e) | $ 636,640 | (i) | ||||||||||||||||||||||||||||||
18,975 / 33,000 (f) | $ 755,015 | (j) | ||||||||||||||||||||||||||||||
TIFFANY & CO.
PS-42
(a) | For any option reported, the grant date was ten (10) years prior to the expiration date shown except for the options expiring on 1/14/09, in which the grant date was eleven (11) years prior to the expiration. All options vest 25% per year over the four-year period following a grant date. | |
(b) | In this column, the number to the left of the slash mark indicates the number of shares on which the payout value shown in the column to the right was computed. See Notes (g), (h), (i) and (j) below. The number to the right of the slash mark indicates the total number of shares that would vest upon attainment of all performance objectives over the three-year performance period. | |
(c) | This grant will have vested three business days following the date on which the Company’s financial results for the fiscal year ended 1/31/08 were released. | |
(d) | This grant will vest three business days following the date on which the Company’s financial results for the fiscal year ending 1/31/09 are released. | |
(e) | This grant will vest three business days following the date on which the Company’s financial results for the fiscal year ending 1/31/10 are released. | |
(f) | This grant will vest three business days following the date on which the Company’s financial results for the fiscal year ending 1/31/11 are released. | |
(g) | This value has been computed at maximum based upon Company EPS and ROA performance in fiscal years 2005, 2006 and 2007. The computation assumes that 85% percent of the units will vest based on EPS performance; the resulting number of shares was then increased by 15% for ROA performance. The resulting value was computed on the basis of the stock closing price on January 31, 2008, $39.79. | |
(h) | This value has been computed based upon Company EPS and ROA performance in fiscal years 2006 and 2007. The computation assumes that 63.5% of the units will vest based on EPS performance; the resulting number of shares was then increased by 15% for ROA performance. The resulting value was computed on the basis of the stock closing price on January 31, 2008, $39.79. | |
(i) | This value has been computed based upon Company EPS and ROA performance in fiscal year 2007. The computation assumes that 55.7% of the units will vest based on EPS performance; the resulting number of shares was then increased by 15% for ROA performance. The resulting value was computed on the basis of the stock closing price on January 31, 2008, $39.79. | |
(j) | This value has been computed at EPS target and on the assumption that the ROA performance goal will have been achieved. |
TIFFANY & CO.
PS-43
Option Awards | Stock Awards | |||||||||||||||||||
Number of | Value | Number of | Value | |||||||||||||||||
Shares | Realized | Shares | Realized | |||||||||||||||||
Acquired on | on | Acquired on | on | |||||||||||||||||
Exercise | Exercise | Vesting | Vesting | |||||||||||||||||
Name | (#) | ($) | (#) | ($) | ||||||||||||||||
Michael J. Kowalski | 100,000 | (a) | $ | 4,254,680.00 | 0 | $ | 0 | |||||||||||||
James E. Quinn | 400,000 | (b) | $ | 15,644,530.50 | 0 | $ | 0 | |||||||||||||
Beth O. Canavan | 99,000 | (c) | $ | 2,142,942.14 | 0 | $ | 0 | |||||||||||||
James N. Fernandez | 100,000 | (d) | $ | 3,694,556.19 | 0 | $ | 0 | |||||||||||||
Jon M. King | 0 | $ | 0 | 0 | $ | 0 | ||||||||||||||
(a) | Weighted-average holding period for options exercised: 10.6 years. | |
(b) | Weighted-average holding period for options exercised: 8.9 years. | |
(c) | Weighted-average holding period for options exercised: 4.8 years. | |
(d) | Weighted-average holding period for options exercised: 8.6 years. |
TIFFANY & CO.
PS-44
Actuarial | Payments | |||||||||||||||||
Present Value | During | |||||||||||||||||
Number | of | Last | ||||||||||||||||
of Years | Accumulated | Fiscal | ||||||||||||||||
Credited | Benefits | Year | ||||||||||||||||
Name | Plan Name (a) | Service | ($) | ($) | ||||||||||||||
Pension Plan | 29 (b) | (d) | $ | 466,638 | $ | 0 | ||||||||||||
Excess Plan | 29( b) | (d) | $ | 4,632,934 | $ | 0 | ||||||||||||
Michael J. Kowalski | Supplemental Plan | 29 (b) | (d) | $ | 1,629,138 | $ | 0 | |||||||||||
Pension Plan | 21 | (d) | $ | 340,322 | $ | 0 | ||||||||||||
Excess Plan | 21 | (d) | $ | 1,989,062 | $ | 0 | ||||||||||||
James E. Quinn | Supplemental Plan | 21 | (d) | $ | 1,125,174 | $ | 0 | |||||||||||
Pension Plan | 20 | $ | 304,626 | $ | 0 | |||||||||||||
Excess Plan | 20 | $ | 970,469 | $ | 0 | |||||||||||||
Beth O. Canavan | Supplemental Plan | 20 | $ | 623,524 | $ | 0 | ||||||||||||
Pension Plan | 29 | (c) | $ | 366,684 | $ | 0 | ||||||||||||
Excess Plan | 29 | (c) | $ | 1,713,873 | $ | 0 | ||||||||||||
James N. Fernandez | Supplemental Plan | 29 | (c) | $ | 606,686 | $ | 0 | |||||||||||
Pension Plan | 17 | $ | 208,875 | $ | 0 | |||||||||||||
Excess Plan | 17 | $ | 485,048 | $ | 0 | |||||||||||||
Jon M. King | Supplemental Plan | 17 | $ | 77,796 | $ | 0 | ||||||||||||
(a) | The formal names of the plans are: the Tiffany and Company Employee Pension Plan (“Pension Plan”), the Tiffany and Company Un-funded Retirement Plan to Recognize Compensation in Excess of Internal Revenue Code Limits (“Excess Plan”) and the Tiffany and Company Supplemental Retirement Income Plan (“Supplemental Plan”). | |
(b) | Mr. Kowalski has been credited with 6.4 years of service for his period of employment prior to October 15, 1984 with the corporation that was, immediately before that date, Tiffany’s parent corporation. The effect of this credit has been to augment the present value of his accumulated benefit under the retirement plans as follows (these amounts are included in the Pension Benefits table above): |
Pension Plan: | $ | 100,647 | ||
Excess Plan: | $ | 999,260 | ||
Supplemental Plan: | $ | 57,194 |
(c) | Mr. Fernandez has been credited with 6.3 years of service for his period of employment prior to October 15, 1984 with the corporation that was, immediately before that date, Tiffany’s parent corporation. The effect of this credit has been to augment the present value of his accumulated benefit under the retirement plans as follows (these amounts are included in the Pension Benefits table above): |
Pension Plan: | $ | 78,281 | ||
Excess Plan: | $ | 365,883 | ||
Supplemental Plan: | $ | 35,865 |
TIFFANY & CO.
PS-45
(d) | Mr. Kowalski and Mr. Quinn are currently eligible for early retirement under each of the Pension, Excess and Supplemental Plan. They are each eligible for early retirement because they have reached age 55 and have accumulated at least ten years of credited service. The normal retirement age under each of the plans is 65. However those eligible for early retirement may retire with a reduced benefit. For retirement at age 55, the reduction in benefit would be 40%, as compared to the benefit at age 65. The benefit reduction for early retirement is computed as follows: |
• | For retirement between age 60 and age 65, the executive’s age at early retirement is subtracted from 65; for each year in the remainder the benefit is reduced by five percent; | ||
• | Thus, for retirement at age 60 the reduction is 25%; | ||
• | For retirement between age 55 and age 60, the reduction is 25% plus an additional three percent for each year by which retirement age precedes age 60. |
• | it is a “tax-qualified plan,” that is, it is designed to comply with those provisions of the Internal Revenue Code applicable to retirement plans; | ||
• | it is a “funded” plan (money has been deposited into a trust that is insulated from the claims of the Company’s creditors); | ||
• | it is available at no cost to regular full-time employees of Tiffany hired on or before December 31, 2005; | ||
• | all executive officers are participants; | ||
• | benefits vest after five years of service; |
TIFFANY & CO.
PS-46
• | benefits are based on the participant’s average final compensation and years of service; | ||
• | benefits are subject to Internal Revenue Code limitations on the total benefit and the amount that may be included in average final compensation; and | ||
• | benefits are not offset by Social Security. |
• | it is not a qualified plan and is not subject to Internal Revenue Code limitations; | ||
• | it is not funded (benefits are paid out of the Company’s general assets, which are subject to the claims of the Company’s creditors); | ||
• | it is available only to employees whose benefits under the Pension Plan are affected by Internal Revenue Code limitations, including all executive officers; | ||
• | it uses the same retirement benefit formula as is set forth in the Pension Plan, but includes in average final compensation earnings that are excluded under the Pension Plan due to Internal Revenue Code Limitations; | ||
• | benefits are offset by benefits payable under the Pension Plan; | ||
• | benefits are not offset by benefits payable under Social Security; | ||
• | benefits vest after five years of service; | ||
• | benefits are subject to forfeiture if employment is terminated for cause; and | ||
• | for those who leave Tiffany prior to age 65, benefits are subject to forfeiture for failure to execute and adhere to non-competition and confidentiality covenants. |
• | it is not a qualified plan and is not subject to Internal Revenue Code limitations; | ||
• | it is not funded (benefits are paid out of the Company’s general assets, which are subject to the claims of the Company’s creditors); | ||
• | it is available only to executive officers; | ||
• | it uses a different benefit formula than that used by the Pension Plan and the Excess Plan; |
TIFFANY & CO.
PS-47
• | benefits are offset by benefits payable under the Pension Plan and the Excess Plan; | ||
• | benefits are offset by benefits payable under Social Security; | ||
• | benefits do not vest until the executive attains age 55 while employed by Tiffany and until he or she has provided 10 years of service (benefits will vest earlier on a change in control as defined in the Retention Agreements); | ||
• | benefits are subject to forfeiture if employment is terminated for cause; and | ||
• | for those who leave Tiffany prior to age 65, benefits are subject to forfeiture for failure to execute and adhere to non-competition and confidentiality covenants. |
Combined Annual Benefit As a Percentage of Average Final | ||||
Years of Service | Compensation | |||
less than 10 | (a) | |||
10-14 | 20 | % | ||
15-19 | 35 | % | ||
20-24 | 50 | % | ||
25 or more | 60 | % | ||
(a) | The formula for benefits under the Pension and Excess Plans is a function of years of service and covered compensation (subject to Internal Revenue Code limitations in the case of the Pension Plan) and not any specific percentage of the participant’s average final compensation (see above). A retiree with less than ten years of service would not receive any benefit under the Supplemental Plan but could expect to receive a benefit of approximately 13% of average final compensation under the Pension and Excess Plans. |
TIFFANY & CO.
PS-48
(Fiscal 2007)
Aggregate | ||||||||||||||||||||
Aggregate | Balance | |||||||||||||||||||
Executive | Registrant | Earnings | At | |||||||||||||||||
Contribution | Contribution | In | Aggregate | Last Fiscal Year | ||||||||||||||||
In | In | Last Fiscal Year | Withdrawals/ | End | ||||||||||||||||
Last Fiscal Year (a) | Last Fiscal Year | (b) | Distributions | (c) | ||||||||||||||||
Name | ($) | ($) | ($) | ($) | ($) | |||||||||||||||
Michael J. Kowalski | $ | 48,619 | $ | 0 | $ | 18,029 | $ | 54,534 | $ | 321,374 | ||||||||||
James E. Quinn | $ | 125,667 | $ | 0 | $ | 16,215 | $ | 0 | $ | 1,294,711 | ||||||||||
Beth O. Canavan | $ | 79,286 | $ | 0 | $ | (6,211 | ) | $ | 52,675 | $ | 466,234 | |||||||||
James N. Fernandez | $ | 136,987 | $ | 0 | $ | 32,487 | $ | 0 | $ | 966,433 | ||||||||||
Jon M. King | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||
(a) | This column includes amounts that are also included in the amounts shown in the columns headed “Salary” or “Non-Equity Incentive Plan Compensation“ in the Summary Compensation Table. | |
(b) | Amounts shown in this column are not reported as compensation in the Summary Compensation Table because the Company’s Executive Deferral Plan does not pay above-market or preferential earnings on compensation that is deferred. | |
(c) | �� | Amounts shown in this column include amounts that were reported as compensation in the Summary Compensation Table for the fiscal year ended January 31, 2008 and for prior fiscal years to the extent that such amounts were contributed by the executive but not to the extent that such amounts represent earnings. See Note (b) above. |
• | Participation is open to directors and executive officers of the Company as well as other vice presidents and “director-level” employees of Tiffany; | ||
• | Directors of the Company may defer all of their cash compensation; | ||
• | Employees may defer up to 50% of their salary and up to 90% of their cash annual incentive or bonus compensation; | ||
• | The Company makes no contribution and guarantees no specific return on money deferred; | ||
• | Deferrals are placed in a trust that is subject to the claims of Tiffany’s creditors; | ||
• | Deferred compensation is invested by the trustee in various mutual funds as directed by Tiffany, which follows the directions of participants; | ||
• | The value in the participant’s account (and Tiffany’s responsibility for payment) is measured by the return on the investments selected by the participant; | ||
• | Deferrals may be made to a Retirement Account and to accounts which will pay out on specified “in-service” dates; |
TIFFANY & CO.
PS-49
• | Participants must elect to make deferrals in advance of the period during which the deferred compensation is earned; | ||
• | Retirement Accounts pay out in 5, 10, 15 or 20 annual installments after retirement as elected in advance by the participant; | ||
• | Except in the case of previously elected “in-service” payout dates, participants are not allowed to withdraw funds while they remain employed other than for unforeseeable emergencies and then only with the permission of Tiffany’s Board; | ||
• | Termination of employment generally triggers a distribution of all account balances other than, in the case of retirement or disability, retirement balances; and | ||
• | Most participants, including all executive officers, will not receive any distribution from the plan until six months following termination of employment; this six-month limitation does not apply to pre-2005 balances. |
TIFFANY & CO.
PS-50
Total Potential | ||||||||||||||||||||||||||||||||||||||||||
Payments | ||||||||||||||||||||||||||||||||||||||||||
Assuming Both a | ||||||||||||||||||||||||||||||||||||||||||
Change in Control | ||||||||||||||||||||||||||||||||||||||||||
Vesting On Change in Control | and a Subsequent | |||||||||||||||||||||||||||||||||||||||||
With or Without Termination of | Payable or Vesting On Termination of Employment | Termination of | ||||||||||||||||||||||||||||||||||||||||
Employment | Following Change in Control | Employment | ||||||||||||||||||||||||||||||||||||||||
Early | Early | Early | Cash Value | |||||||||||||||||||||||||||||||||||||||
Vesting of | Vesting | Vesting | of | |||||||||||||||||||||||||||||||||||||||
Supple- | of | of | Cash | Increased | ||||||||||||||||||||||||||||||||||||||
mental | Stock | Restricted | Severance | Service | Welfare | Excise Tax | ||||||||||||||||||||||||||||||||||||
Plan | Options | Stock Units | Payment | Credit | Benefits | Gross Up | Total | |||||||||||||||||||||||||||||||||||
Name | (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | ||||||||||||||||||||||||||||||||||
Michael J. Kowalski | $ | 0 | $ | 538,358 | $ | 9,271,070 | $ | 8,325,000 | $ | 2,551,912 | $ | 101,106 | $ | 7,702,262 | $ | 28,489,708 | ||||||||||||||||||||||||||
James E. Quinn | $ | 0 | $ | 288,235 | $ | 5,073,225 | $ | 5,106,000 | $ | 1,316,943 | $ | 106,383 | $ | 0 | $ | 11,890,786 | ||||||||||||||||||||||||||
Beth O. Canavan | $ | 623,524 | $ | 199,293 | $ | 3,441,835 | $ | 2,400,000 | $ | 730,770 | $ | 67,000 | $ | 2,758,534 | $ | 10,220,956 | ||||||||||||||||||||||||||
James N. Fernandez | $ | 606,686 | $ | 276,468 | $ | 4,834,485 | $ | 2,980,000 | $ | 807,832 | $ | 70,980 | $ | 3,209,284 | $ | 12,785,735 | ||||||||||||||||||||||||||
Jon M. King | $ | 77,796 | $ | 217,715 | $ | 3,143,410 | $ | 2,060,000 | $ | 469,084 | $ | 39,261 | $ | 2,302,750 | $ | 8,310,016 | ||||||||||||||||||||||||||
(a) | Absent a change in control the Supplemental Plan will vest only when the participant attains the in-service age of 55 years with ten years of service. | |
(b) | The value of early vesting of stock options was determined using $39.79, the closing value of the Company’s common stock on January 31, 2008. | |
(c) | The value of early vesting of those grants of performance-based restricted stock units whose performance measuring period was not completed as of January 31, 2008 was determined using $39.79, the closing value of the Company’s common stock on January 31, 2008. In the event of a change in control such units vest at the maximum number of shares. The value of performance-based restricted stock units whose performance measuring period ended on January 31, 2008 was not included in this calculation on the assumption that the earned value of the units would be paid regardless of the change in control. That value, determined on the basis of actual earnings and return on assets during the three-year performance period ended January 31, 2008 (which was paid in shares on March 27, 2008 was as follows for each of the named executive officers: Mr. Kowalski — 92,000 shares (value @ $39.79 was $3,660,680); Mr. Quinn — 58,000 shares (value @ $39.79 was $2,307,820); Mrs. Canavan — 32,000 shares (value @ $39.79 was $1,273,280); |
TIFFANY & CO.
PS-51
Mr. Fernandez — 44,000 shares (value @ $39.79 was $1,750,760); and Mr. King — 24,000 shares (value @ $39.79 was $954,960); | ||
(d) | Cash severance payments were determined by multiplying the sum of (i) actual salary and (ii) the highest annual incentive award or bonus paid in either Fiscal 2006, 2005 or 2004 by three, in the case of Mr. Kowalski and Mr. Quinn, or by two, in the case of the other executive officers. | |
(e) | The addition of two or three years of service credit, as applicable, would not have entitled any of these executives to a higher percentage pension benefit under the Supplemental Plan. The cash value of the increased service credit has been calculated based on the change in average final compensation that would result from two or three years of additional employment at the salary and incentive award/bonus referred to in note (d) above. | |
(f) | The amounts shown in this column represent two or three years of health-care coverage determined on the basis of the Company’s “COBRA” rates for post-employment continuation coverage. Such rates are available to all participating employees who terminate from employment and were determined on the basis of the coverage elections made by the executive officer. The amounts shown in this column also represent two or three years of long-term disability coverage determined on the basis of the Company’s current cost to provide such coverage. | |
(g) | The excise tax gross-up was determined with reference to the excise tax under Section 4999 of the Internal Revenue Code, a review of W-2 for the individuals in question for the necessary historical period. | |
(h) | This column is the total of columns (a) through (g) in the table above. It assumes that two events have occurred: a change in control and a termination of employment following such change in control. |
• | Two (for executives with two year terms of employment) or three (for executives with three year terms of employment) times the sum of salary and the highest annual incentive award or bonus paid for the preceding three fiscal years, as severance; | ||
• | A payment equal to the present value of two or three years of additional years of service credit at the salary and annual incentive award or bonus referred to above under the Supplemental Plan; and | ||
• | Two or three years of benefits continuation under Tiffany’s health and welfare plans. |
TIFFANY & CO.
PS-52
• | Any person or group of persons acting in concert (and by person we mean an individual or organization) acquires thirty-five percent or more in voting power or stock of the Company, including the acquisition of any right, option, warrant or other right to obtain such voting power or stock, whether or not presently exercisable; | ||
• | A majority of the Board is, for any reason, not made up of individuals who were either on the Board on January 21, 1988, or, if they became members of the Board after that date, were approved by the directors; or | ||
• | Any other circumstance which the Board deems to be a “change in control.” |
TIFFANY & CO.
PS-53
Fiscal 2007
Change in Pension Value | |||||||||||||||||||||
Fees Earned or | and Nonqualified | All Other | |||||||||||||||||||
Paid in Cash | Option Awards | Deferred Compensation | Compensation | Total | |||||||||||||||||
Name | ($)(a) | ($) (b) (c) | Earnings (d) | ($) | ($) | ||||||||||||||||
Rose Marie Bravo | $ | 69,000 | $ | 185,458 | $ | 11,148 | $ | 0 | $ | 265,606 | |||||||||||
William R. Chaney | $ | 66,000 | $ | 185,458 | $ | 0 | $ | 0 | $ | 251,458 | |||||||||||
Gary E. Costley | $ | 95,000 | $ | 86,926 | $ | N/A | $ | 0 | $ | 181,926 | |||||||||||
Abby F. Kohnstamm | $ | 79,000 | $ | 185,458 | N/A | $ | 0 | $ | 264,458 | ||||||||||||
Charles K. Marquis | $ | 86,000 | $ | 185,458 | $ | 16,344 | $ | 0 | $ | 287,802 | |||||||||||
J. Thomas Presby | $ | 97,000 | $ | 185,458 | N/A | $ | 0 | $ | 282,458 | ||||||||||||
William A. Shutzer | $ | 66,000 | $ | 185,458 | $ | 5,803 | $ | 0 | $ | 257,261 | |||||||||||
(a) | Includes amounts deferred under the Executive Deferral Plan. | |
(b) | Amounts shown represent the dollar amount of compensation cost recognized in Fiscal 2007 for stock options granted for Fiscal 2007 and previous fiscal years in accordance with SFAS No. 123R. In valuing option awards the Company made certain assumptions. For a discussion of those assumptions, please refer to Part II of the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2008. See Note M. “STOCK COMPENSATION PLANS”, in Notes to Consolidated Financial Statements, under Item 8. Financial Statements and Supplementary Data. |
TIFFANY & CO.
PS-54
(c) | Supplementary Table:Outstanding Director Option Awards at Fiscal Year End |
Aggregate Number of Option | ||||
Awards Outstanding at Fiscal Year End | ||||
Name | (number of underlying shares) | |||
Rose Marie Bravo | 107,216 | |||
William R. Chaney | 207,500 | |||
Gary E. Costley | 20,000 | |||
Abby F. Kohnstamm | 70,000 | |||
Charles K. Marquis | 148,924 | |||
J. Thomas Presby | 45,000 | |||
William A. Shutzer | 100,000 | |||
(d) | The actuarial valuation shown takes into account the current age of the director and is based on the following assumptions consistent with those used in preparing the financial statements: 1994 Group Mortality Table, Male & Female; discount rate of 6.50% and retirement age of 65 (if the director is over age 65, the director is assumed to retire on January 31, 2008. Where a “0” appears in this column it is because there was a decline in value. In the case of Mr. Chaney, the decline was approximately $17,611. |
• | An annual retainer of $50,000; | ||
• | An additional annual retainer of $20,000, $10,000 or $5,000 to the chairperson of the Audit, Compensation, or Nominating/Corporate Governance Committee, respectively; | ||
• | A per-meeting-attended fee of $2,000 for meetings attended in person (no fee is paid for attendance at any committee or subcommittee meetings which occur on the same day as a meeting of the full Board); | ||
• | A fee of $1,000 for each telephonic meeting in which the director participates; | ||
• | Stock options, as discussed below; and | ||
• | A retirement benefit, also discussed below. |
Director | Registrant | Aggregate Balance | ||||||||||||||||||
Contribution | Contribution | Aggregate Earnings | Aggregate | At | ||||||||||||||||
In | In | In | Withdrawals/ | Last Fiscal Year | ||||||||||||||||
Last Fiscal Year | Last Fiscal Year | Last Fiscal Year | Distributions | End | ||||||||||||||||
Name | ($) | ($) | ($) | ($) | ($) | |||||||||||||||
Gary E. Costley | $ | 95,000 | $ | 0 | $ | (5,702 | ) | $ | 0 | $ | 89,298 | |||||||||
Charles K. Marquis | $ | 0 | $ | 0 | $ | 10,857 | $ | 0 | $ | 479,619 | ||||||||||
William A. Shutzer | $ | 66,000 | $ | 0 | $ | (35,049 | ) | $ | 0 | $ | 658,420 | |||||||||
TIFFANY & CO.
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TIFFANY & CO.
PS-56
ANNUAL RETURN PERCENTAGE | ||||||||||||||||||||
Years Ending | ||||||||||||||||||||
Company / Index | 1/31/04 | 1/31/05 | 1/31/06 | 1/31/07 | 1/31/08 | |||||||||||||||
Tiffany & Co. | 71.45 | -20.17 | 20.95 | 5.26 | 2.43 | |||||||||||||||
S&P 500 Index | 34.57 | 6.23 | 10.38 | 14.51 | -2.31 | |||||||||||||||
S&P 500 Consumer Discretionary Index | 40.94 | 9.39 | -0.59 | 19.85 | -16.64 |
INDEXED RETURNS | ||||||||||||||||||||||||
Years Ending | ||||||||||||||||||||||||
Base | ||||||||||||||||||||||||
Period | ||||||||||||||||||||||||
Company / Index | 1/31/03 | 1/31/04 | 1/31/05 | 1/31/06 | 1/31/07 | 1/31/08 | ||||||||||||||||||
Tiffany & Co. | 100 | 171.45 | 136.86 | 165.53 | 174.23 | 178.46 | ||||||||||||||||||
S&P 500 Index | 100 | 134.57 | 142.95 | 157.79 | 180.70 | 176.52 | ||||||||||||||||||
S&P 500 Consumer Discretionary Index | 100 | 140.94 | 154.18 | 153.27 | 183.69 | 153.13 | ||||||||||||||||||
TIFFANY & CO.
PS- 57
Michael J. Kowalski | Mr. Kowalski, 56, is Chairman of the Board and Chief Executive Officer of Tiffany & Co. He succeeded William R. Chaney as Chairman at the end of fiscal year 2002 and as Chief Executive Officer in February 1999. Prior to his appointment as President in January 1996, he was an Executive Vice President of Tiffany & Co., a position he had held since March 1992. Mr. Kowalski also served as Tiffany & Co.’s Chief Operating Officer from January 1997 until his appointment as Chief Executive Officer. He became a director of Tiffany & Co. in January 1995. Mr. Kowalski also serves on the board of The Bank of New York Mellon. The Bank of New York Mellon is Tiffany’s principal banking relationship, serving as Administrative Agent and a lender under a Revolving Credit Facility and as trustee of Tiffany’s Employee Pension Plan, and as the trustee and an investment manager for Tiffany’s employee pension plan; and Mellon Investor Services LLC serves as the Company’s transfer agent and registrar. | |
Rose Marie Bravo | Ms. Bravo, 57, became a director of Tiffany & Co. in October 1997 when she was selected by the Board to fill a newly created directorship. Ms. Bravo previously served as Chief Executive Officer of Burberry Limited from 1997 until 2006 and as President of Saks Fifth Avenue from 1992 to 1997. Prior to Saks, Ms. Bravo held a series of merchandising jobs at Macy’s culminating in the Chairman & Chief Executive Officer role at I. Magnin which was a division of R. H. Macy & Co. Ms. Bravo serves on the Board of Directors of Estee Lauder Companies Inc. |
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Gary E. Costley | Dr. Costley, 64, was first elected to the Board in May 2007. He is a co-founder and managing director of C&G Capital and Management, LLC, which provides capital and management to health, medical and nutritional products and services companies. He was Chairman and Chief Executive Officer of International Multifoods Corporation, a manufacturer and marketer of branded consumer food and food service products from November 1997 until June 2004. Dr. Costley was Dean of the Graduate School of Management at Wake Forest University from 1995 until 1997. Dr. Costley held numerous positions at the Kellogg Company from 1970 until June 1994. His most recent position was President of Kellogg North America. He is a director of three other public companies: The Principal Financial Group, Covance Inc. and Prestige Brands Holdings, Inc. | |
Lawrence K. Fish | Mr. Fish, 63, is Chairman of Royal Bank of Scotland America and Chairman of Citizens Financial Group, Inc. (“Citizens”). He has served in that role since 2005, and before that as President and Chief Executive Officer, from 1992, of Citizens. Mr. Fish is a member of the Board of Trustees of Massachusetts Institute of Technology and an Overseer of the Boston Symphony Orchestra. He serves on the boards of the Royal Bank of Scotland Group, Textron and The Brookings Institution. | |
Abby F. Kohnstamm | Ms. Kohnstamm, 54, is the President and founder of Abby F. Kohnstamm & Associates, Inc., a marketing and consulting firm. Prior to establishing her company, Ms. Kohnstamm served as Senior Vice President, Marketing of IBM Corporation from 1993 through 2005. In that capacity, she had overall responsibility for all aspects of marketing across IBM. Ms. Kohnstamm remains an executive consultant to IBM. In addition, Ms. Kohnstamm held a number of senior marketing positions at American Express from 1979 through 1993. Ms. Kohnstamm also serves on the Board of Directors of the Progressive Corporation and the Board of Trustees of Tufts University where she is also a member of its Executive Committee. She became a director of Tiffany & Co. in July 2001, when she was selected by the Board to replace a retiring director. | |
Charles K. Marquis | Mr. Marquis, 65, is a Senior Advisor to Investcorp International, Inc. From 1974 through 1998, he was a partner in the law firm of Gibson, Dunn & Crutcher L.L.P. He was elected a director of Tiffany & Co. in 1984. Mr. Marquis also serves as a director and nominating/corporate governance chair of CSK Auto Corporation. | |
Peter W. May | Mr. May, 65, is President and founding partner of Trian Partners, a New York-based investment management firm launched in November 2005. Mr. May also serves as Vice Chairman and a director of Trian Acquisition I Corp. (AMEX: TUX.U), a publicly traded blank check company formed to effect a business combination, and as non-executive Vice Chairman and a director of Triarc Companies, Inc. (NYSE: TRY, TRY.B), a holding company that owns Arby’s Restaurant Group, Inc. (“Triarc”). In addition, Mr. May serves as a director and chairman of the compensation committee of Deerfield Capitol Corp. (NYSE:DFR). Mr. May served as President and Chief Operating Officer of Triarc from April 1993 through June 2007. Prior to joining Triarc, Mr. May was President and Chief Operating Officer of Trian Group, Inc., which provided investment banking and management services for entities controlled by him. |
TIFFANY & CO.
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Mr. May also served as President and Chief Operating Officer and a director of Triangle Industries, Inc., which, through wholly-owned subsidiaries, was, at the time, a manufacturer of packaging products (through American National Can Company), copper electrical wire and cable and steel conduit and currency and coin handling products. Mr. May is the Chairman of the Board of Trustees of The Mount Sinai Medical Center in New York, where he led the turnaround of this major academic health center from serious financial difficulties to what is today one of the most profitable and fastest growing academic medical centers in the United States. In addition, Mr. May is a Trustee of the University of Chicago, a member of its Executive Committee, and a member of the Advisory Council on the Graduate School of Business at The University of Chicago. Mr. May is also a Trustee of Carnegie Hall and a partner of the Partnership for New York City, as well as the past Chairman of the UJA Federation’s “Operation Exodus” campaign and an honorary member of the Board of Trustees of The 92nd Street Y. He is a founding member of the Laura Rosenberg Memorial Foundation for Pediatric Leukemia Research and is Chairman of the Board of The Leni and Peter May Family Foundation. | ||
J. Thomas Presby | Mr. Presby, 68, has used his business experience and professional qualifications to forge a second career of essentially full-time board service since he retired in 2002 as a partner in Deloitte Touche Tohmatsu. At Deloitte he held numerous positions in the United States and abroad, including the posts of Deputy Chairman and Chief Operating Officer. He was selected to be a director of the Company in November 2003 by the Board to fill a newly created position. He now serves as a director and audit committee chair for the Company and American Eagle Outfitters, Invesco Ltd, First Solar, Inc., TurboChef Technologies, Inc. and World Fuel Services, Inc. As Mr. Presby has no significant business activities other than board service, he is available full time to fulfill his board responsibilities. Further, he finds that he is able to leverage the experience of managing this particular set of audit committees to the benefit of each board on which he serves and the efficient use of his own time and that of his colleagues. He is a certified public accountant and a holder of the NACD Certificate of Director Education. | |
William A. Shutzer | Mr. Shutzer, 61, is a Senior Managing Director of Evercore Partners, a financial advisory and private equity firm. He previously served as a Managing Director of Lehman Brothers from 2000 through 2003, a Partner in Thomas Weisel Partners LLC, a merchant banking firm, from 1999 through 2000, as Executive Vice President of ING Baring Furman Selz LLC from 1998 through 1999, President of Furman Selz Inc. from 1995 through 1997 and as a Managing Director of Lehman Brothers and its predecessors from 1978 through 1994. He was elected a director of the Company in 1984. Mr. Shutzer is also a member of the Boards of Directors of Jupiter Media Corp. and CSK Auto Corporation. He also serves as a director and compensation committee chair of TurboChef Technologies, Inc. |
TIFFANY & CO.
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• | directors to whom awards are granted, | ||
• | the size and type of awards, and | ||
• | the terms and conditions of such awards. |
• | the term of an option may not exceed 10 years, | ||
• | the per-share exercise price of each option must be established at the time of grant or determined by a formula established at the time of grant, | ||
• | the exercise price may not be less than 100% of fair market value as of the “pricing date”, | ||
• | the per-share exercise price may not be decreased after grant except for adjustments made to reflect stock splits and other corporate transactions (seeMaximum Number of Shares and Adjustments for Corporate Transactionsbelow), | ||
• | an option may not be surrendered for a new option with a lower exercise price and | ||
• | the pricing date must generally be the grant date, subject to limited exceptions. |
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• | in cash, | ||
• | by the tender of the Company’s shares of Common Stock, or | ||
• | by irrevocable authorization to a third party to sell shares received upon exercise of the option and to remit the exercise price. |
• | stock splits, stock dividends and stock distributions, |
TIFFANY & CO.
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• | any other transaction in which outstanding shares of Common Stock are increased, decreased, changed or exchanged, or | ||
• | a transaction in which cash, property, Common Stock or other securities are distributed in respect of outstanding shares. |
• | the number and/or type of shares for which awards may be granted under the Incentive Plans after such transaction, and | ||
• | the number and/or type of shares or securities for which awards then outstanding under the Incentive Plans may be exercised after such transaction — such adjustments would be made without changing the aggregate exercise price applicable to the unexercised portions of outstanding options or SARs. |
• | increase the maximum number of shares that may be delivered under the Plan as described inMaximum Number of Shares and Adjustments for Corporate Transactionsabove, including the requirement to reduce such maximum by 1.58 shares for every share delivered as a stock award, | ||
• | increase the per-participant limit described above underPer-Year-Per-Participant Limit Under the Plan, | ||
• | decrease the minimum exercise price for an option or permit the surrender of an option as consideration in exchange for a new award with a lower exercise price, each as described above underOptionsor | ||
• | increase the maximum term of an Option as described above underOptions. |
TIFFANY & CO.
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TIFFANY & CO.
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600 Madison Avenue, New York, New York, 10022, addressed to the attention of Patrick B. Dorsey, Corporate Secretary (Legal Department).
TIFFANY & CO.
PS- 67
Secretary
April 10, 2008
TIFFANY & CO.
PS- 68
(a Delaware corporation)
and amended and restated March 15, 2007)
1. | Director Qualification Standards;Size of the Board; Audit Committee Service. |
I-1
I-2
2. | Attendance and Participation at Board and Committee Meetings. |
3. | Director Access to Management and Independent Advisors. |
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4. | Director Compensation. |
5. | Director Orientation and Continuing Education. |
6. | Management Succession. |
7. | Annual Performance Evaluation of the Board. |
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8. | Matters for Board Review, Evaluation and/or Approval. |
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9. | Management’s Responsibilities. |
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10. | Meeting Procedures. |
11. | Committees. |
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12. | Reliance. |
13. | Reference to Corporation’s Subsidiaries. |
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2008 DIRECTORS EQUITY COMPENSATION PLAN
General
Options
II-1
(a) | The Exercise Price may be paid by ordinary check or such other form of tender as the Committee may specify. | ||
(b) | If permitted by the Committee, the Exercise Price for Shares purchased upon the exercise of an Option may be paid in part or in full by tendering Shares (by either actual delivery of shares or by attestation, with such shares valued at Fair Market Value as of the date of exercise). The Committee may refuse to accept payment in Shares if such payment would result in an accounting charge to the Company. | ||
(c) | The Committee may permit a Participant to elect to pay the Exercise Price upon the exercise of an Option by irrevocably authorizing a third party to sell Shares acquired upon exercise of the Option (or a sufficient portion of such shares) and remit to the Company a sufficient portion of the sale proceeds to pay the entire Exercise Price and any tax withholding resulting from such exercise. |
Stock Awards
II-2
Operation and Administration
(a) | (i) Subject to the following provisions of this subsection 4.2, the maximum aggregate number of Shares that may be delivered to Participants and their beneficiaries under the Plan shall be One Million (1,000,000) Shares, provided that such maximum shall be reduced by one and 58 hundredths (1.58) of a Share for each Share that is delivered pursuant to a Stock Award. Shares issued under the Plan may be authorized and unissued Shares or Shares reacquired by the Company. | ||
(ii) Any Shares granted under the Plan that are forfeited because of the failure to meet a Stock Award contingency or condition shall again be available for delivery pursuant to new Awards granted under the Plan. To the extent any Shares covered by an Award are not delivered to a Participant or a Participant’s beneficiary because the Award is forfeited or canceled, such shares shall not be deemed to have been delivered for purposes of determining the maximum number of Shares available for delivery under the Plan. | |||
(iii) If the Exercise Price and/or tax withholding obligation for any Option or Award granted under the Plan is satisfied by tendering Shares to the Company (by either actual delivery or attestation) or by the Company withholding Shares, the number of Shares issued on such exercise or Award without offset for the number of Shares so tendered shall be deemed delivered for purposes of determining the maximum number of Shares available for delivery under the Plan; if the Exercise Price and/or tax withholding obligation for any Option or Award granted under the Plan is satisfied by the Company withholding Shares, the full number of Shares for which such Option was exercised or such Award was granted, without reduction for the number of Shares withheld, shall be deemed delivered for purposes of determining the maximum number of Shares available for delivery under the Plan. | |||
(b) | Subject to adjustment under paragraph 4.2(c), the following additional limitation is imposed under the Plan: the maximum aggregate number of Shares that may be awarded to any one Participant in any single fiscal year of the Company, either as Shares subject to Options, Stock Awards or any combination of Options and Stock Awards shall be Twenty-five Thousand (25,000) Shares. | ||
(c) | If the outstanding Shares are increased or decreased, or are changed into or exchanged for cash, property, or a different number or kind of shares or securities, or if cash, property or Shares or other securities are distributed in respect of such outstanding Shares, in either case as a result of one or more mergers, reorganizations, reclassifications, recapitalizations, stock splits, reverse stock splits, stock dividends, dividends (other than regular, quarterly dividends), or other distributions, spin-offs or the like, or if substantially all of the property and assets of the Company are sold, then, unless |
II-3
the terms of the transaction shall provide otherwise, appropriate adjustments shall be made in the number and/or type of shares or securities for which Awards may thereafter be granted under the Plan and for which Awards then outstanding under the Plan may thereafter be exercised. Any such adjustments in outstanding Awards shall be made without changing the aggregate Exercise Price applicable to the unexercised portions of outstanding Options. The Committee shall make such adjustments to preserve the benefits or potential benefits of the Plan and the Awards; such adjustments may include, but shall not be limited to, adjustment of: (i) the number and kind of shares which may be delivered under the Plan; (ii) the number and kind of shares subject to outstanding Awards; (iii) the Exercise Price of outstanding Options; (iv) the limit specified in subsection 4.2(b) above; and (v) any other adjustments that the Committee determines to be equitable. No right to purchase or receive fractional shares shall result from any adjustment in Options or Stock Awards pursuant to this paragraph 4.2(c). In case of any such adjustment, Shares subject to the Option or Stock Award shall be rounded up to the nearest whole Share. |
(a) | Notwithstanding any other provision of the Plan, the Company shall have no obligation to deliver any Shares under the Plan or make any other distribution of benefits under the Plan unless such delivery or distribution would comply with all applicable laws (including, without limitation, the requirements of the Securities Act of 1933) and the applicable requirements of any securities exchange or similar entity and the Committee may impose such restrictions on any Shares acquired pursuant to the Plan as the Committee may deem advisable, including, without limitation, restrictions under applicable federal securities laws, under the requirements of any stock exchange or market upon which such Shares are then listed and/or traded, and under any blue sky or state securities laws applicable to such Shares. In the event that the Committee determines in its discretion that the registration, listing or qualification of the Shares issuable under the Plan on any securities exchange or under any applicable law or governmental regulation is necessary as a condition to the issuance of such Shares under an Option or Stock Award, such Option or Stock Award shall not be exercisable or exercised in whole or in part unless such registration, listing and qualification, and any necessary consents or approvals have been unconditionally obtained. | ||
(b) | Distribution of Shares under the Plan may be effected on a non-certificated basis, to the extent not prohibited by applicable law or the applicable rules of any stock exchange. |
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(a) | Neither a Participant nor any other person shall, by reason of the Plan or any Award Agreement, acquire any right in or title to any assets, funds or property of the Company or any Related Company whatsoever, including, without limitation, any specific funds, assets, or other property which the Company or any Related Company, in their sole discretion, may set aside in anticipation of a liability under the Plan. A Participant shall have only a contractual right to the Shares or amounts, if any, payable under the Plan, unsecured by the assets of the Company or of any Related Company. Nothing contained in the Plan or any Award Agreement shall constitute a guarantee that the assets of such companies shall be sufficient to pay any benefits to any person. | ||
(b) | Neither the Plan nor any Award Agreement shall constitute a contract of employment, and selection as a Participant will not confer upon any Participant any right to serve as a director of the Company, nor any right or claim to any benefit under the Plan, unless such right or claim has specifically accrued under the terms of the Plan or an Award. Except as otherwise provided in the Plan, no Award under the Plan shall confer upon the holder thereof any right as a stockholder of the Company prior to the date on which the individual fulfills all conditions for receipt of such rights. |
Committee
II-6
(a) | Subject to the provisions of the Plan, the Committee will have the authority and discretion to select from amongst Eligible Individuals those persons who shall receive Awards, to determine who is an Eligible Individual, to determine the time or times of receipt, to determine the types of Awards and the number of Shares covered by the Awards, to establish the terms, conditions, restrictions, and other provisions of such Awards and Award Agreements, and (subject to the restrictions imposed by Section 6) to cancel, amend or suspend Awards. In making such Award determinations, the Committee may take into account such factors as the Committee deems relevant. | ||
(b) | The Committee will have the authority and discretion to establish terms and conditions of Awards as the Committee determines to be necessary or appropriate to conform to applicable requirements or practices of jurisdictions outside the United States. | ||
(c) | The Committee will have the authority and discretion to interpret the Plan, to establish, amend and rescind any rules and regulations relating to the Plan, to determine the terms and provisions of any Award Agreements, and to make all other determinations that may be necessary or advisable for the administration of the Plan. | ||
(d) | Interpretations of the Plan by the Committee and decisions made by the Committee under the Plan are final and binding. | ||
(e) | In controlling and managing the operation and administration of the Plan, the Committee shall act by a majority of its then members, by meeting or by writing filed without a meeting. The Committee shall maintain adequate records concerning the Plan and concerning its proceedings and acts in such form and detail as the Committee may decide. |
II-7
Amendment and Termination
Defined Terms
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Successors
II-9
The Board of Directors recommends a vote FOR all nominees and FOR proposals 2 and 3. Shares represented by this proxy will be so voted unless otherwise indicated, in which case they will be voted as marked. | Please Mark Here for Address Change or Comments | c | |
SEE REVERSE SIDE |
Item 1: Election of the following nominees as directors: | THIS PROXY IS CONTINUED ON THE REVERSE SIDE. |
FOR | AGAINST | ABSTAIN | FOR | AGAINST | ABSTAIN | FOR | AGAINST | ABSTAIN | |||||||||||||||
01 | Michael J. Kowalski | c | c | c | 05 | Abby F. Kohnstamm | c | c | c | 09 William A. Shutzer | c | c | c | ||||||||||
FOR | AGAINST | ABSTAIN | FOR | AGAINST | ABSTAIN | FOR | AGAINST | ABSTAIN | |||||||||||||||
02 | Rose Marie Bravo | c | c | c | 06 | Charles K. Marquis | c | c | c | Item 2: | Ratification of the selection ofPricewaterhouseCoopers LLP as theCompany’s independent registered public accounting firm for fiscal year 2008. | c | c | c | |||||||||
FOR | AGAINST | ABSTAIN | FOR | AGAINST | ABSTAIN | FOR | AGAINST | ABSTAIN | |||||||||||||||
03 | Gary E. Costley | c | c | c | 07 | Peter W. May | c | c | c | Item 3: | Approval of the Tiffany & Co. 2008 Directors Equity Compensation Plan. | c | c | c | |||||||||
FOR | AGAINST | ABSTAIN | FOR | AGAINST | ABSTAIN | I PLAN TO ATTEND THE ANNUAL MEETING | c | ||||||||||||||||
04 | Lawrence K. Fish | c | c | c | 08 | J. Thomas Presby | c | c | c | ||||||||||||||
| ||||||||||||||||||||
Signature | Signature | Date | ||||||||
BOTH ARE AVAILABLE 24 HOURS A DAY, 7 DAYS A WEEK.
the day prior to annual meeting day.
as if you marked, signed and returned your proxy card.
INTERNET http://www.proxyvoting.com/tif | TELEPHONE 1-866-540-5760 | |||||||
Use the internet to vote your proxy. Have your proxy card in hand when you access the web site. | OR | Use any touch-tone telephone to vote your proxy. Have your proxy card in hand when you call. | ||||||
The undersigned hereby appoints M.J. KOWALSKI, J.N. FERNANDEZ, and P.B. DORSEY, and each of them, proxies, with full power of substitution, to act for the undersigned, and to vote all shares of common stock represented by this proxy which the undersigned may be entitled to vote at the 2008 Annual Meeting of Stockholders (and any adjournment thereof) as directed and permitted on the reverse side of this card and, in their judgment, on such matters as may be incident to the conduct of or may properly come before the meeting. | ||
IMPORTANT THIS PROXY IS CONTINUED ON THE REVERSE SIDE | ||
Address Change/Comments(Mark the corresponding box on the reverse side) | ||
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727 Fifth Avenue
New York, N.Y. 10022
THURSDAY, MAY 15, 2008
Secretary
New York, New York
April 10, 2008