COO » Topics » DIRECTOR COMPENSATION

This excerpt taken from the COO DEF 14A filed Feb 5, 2010.

DIRECTOR COMPENSATION

The Compensation Committee reviews compensation of the Non-Employee Directors and the Board approves compensation amounts based on these recommendations. Directors of a publicly traded company have substantial responsibilities and time commitments, and with recent changes in corporate governance standards, highly qualified and experienced directors are in high demand; therefore, we seek to provide appropriate economic incentives for our directors and to compensate them appropriately for their continued performance, workload and dedication. The Compensation Committee takes these factors into account in making recommendations to the Board with regard to changes in the Non-Employee Director compensation package.

The Compensation Committee also receives an analysis from their independent consultant, J. Richard, with regard to Non-Employee Director compensation. The Compensation Committee reviews and analyzes the information provided by J. Richard in determining whether to recommend changes to the Board. The Board sets total Non-Employee Director compensation at levels it considers appropriate given the competitive market for qualified directors and the time commitment expected of the Non-Employee Directors. Director compensation is reviewed regularly and modified as the Board considers necessary or appropriate.

This excerpt taken from the COO DEF 14A filed Feb 6, 2009.

DIRECTOR COMPENSATION

 

The Compensation Committee reviews compensation of the Non-Employee Directors and the Board approves compensation amounts based on these recommendations. Directors of a publicly traded company have substantial responsibilities and time commitments, and with recent changes in corporate governance standards, highly qualified and experienced directors are in high demand; therefore, we seek to provide appropriate economic incentives for our directors and to compensate them appropriately for their continued performance, workload and dedication. The Compensation Committee takes these factors into account in making recommendations to the Board with regard to changes in the Non-Employee Director compensation package.

 

The Compensation Committee also receives an analysis from their independent consultant, J. Richard, with regard to Non-Employee Director compensation. The Compensation Committee reviews and analyzes the information provided by J. Richard in determining whether to recommend changes to the Board. The Board sets total Non-Employee Directors compensation at levels it considers appropriate given the competitive market for qualified directors and the time commitment expected of the Non-Employee Directors. Director compensation is reviewed regularly and modified as the Board considers necessary or appropriate.

 

Stipends and Committee Chair Compensation

 

We compensate each Non-Employee Director based on service to us, including attendance at meetings and service on committees of the Board. Annual cash retainers, stipends for service as a committee chair and equity compensation grants are designed to correspond to the relative responsibility of each director and are regularly reviewed to ensure they meet this standard.

 

Directors who are also our employees receive no additional compensation for their service as directors.

 

For fiscal year 2008, each Non-Employee Director received an annual retainer of $30,000 for their services. Mr. Bender and Dr. Rubenstein each received an additional stipend of $10,000 per year for their service as Chairman of the Board and Lead Director, respectively. Mr. Bender also receives an additional consulting fee of $250,000 per year, paid quarterly, for services to the company. This amount will be paid through March 2009.

 

Chair Stipends and Meeting Payments

 

The Non-Employee Directors who served as Committee Chairs received an additional stipend in recognition of their time devoted to us in this capacity. Stipend amounts are structured to reflect the additional requirements placed on each committee chair.

 

Committee Chair Stipends:


    

Audit Committee Chair (Steven Rosenberg)

   $15,000 per year

Organization & Compensation Committee Chair (Michael Kalkstein)

   $12,000 per year

Corporate Governance Committee Chair (Donald Press)

   $10,000 per year

Science & Technology Committee Chair (Stanley Zinberg, M.D.)

   $10,000 per year

Nominating Committee Chair (Moses Marx)

   $1,000 per year

 

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The Non-Employee Directors are also compensated for attendance at meetings as follows:

 

Fee per Meeting:


    

Meetings held in person by the Board or any Committee of the Board

   $ 2,000 per meeting

Meetings held telephonically by the Board or any Committee of the Board and lasting more than 2 hours

   $ 2,000 per meeting

Meetings held telephonically by the Board or any Committee of the Board and lasting less than 2 hours

   $ 1,000 per meeting

 

In the event that more than one meeting occurs on the same day, Non-Employee Directors will not be compensated more than $2,000 per day for meeting attendance.

 

Non-Employee Directors are also compensated at a rate of $250 per hour, not to exceed $2,000 for any day, for time spent substantially on work for us and for one travel day in connection with meetings at $2,000 per day.

 

Equity Compensation

 

In addition to cash compensation, the Non-Employee Directors participate in the 2006 Directors’ Plan, which provides for annual equity grants in the form of restricted stock and stock options. The Board believes that Non-Employee Director compensation, like executive compensation, should contain a significant equity component in order to align director and stockholder interests. Grant dates, award amounts and vesting criteria for these annual equity grants are set by the terms of the 2006 Directors’ Plan.

 

The 2006 Directors’ Plan was approved by stockholders on March 21, 2006 and provides for two equity grants to the Non-Employee Directors each November as follows:

 

 

(a)

 

a grant of a designated number of stock options on November 1, or the first business day thereafter if the 1st is on a weekend, with an exercise price equal to 100% of the fair market value, defined as the average of the high and low trading prices on the grant date as reported on http://finance.yahoo.com, of our common stock on the date of grant; and

 

 

(b)

 

a grant of restricted stock on November 15, or the first business day thereafter if the 15th is on a weekend, which entitles each Non-Employee Director to purchase a designated number of shares of restricted stock at par value.

 

The 2006 Directors’ Plan also provides that, upon appointment to the Board, new Non-Employee Directors receive a grant of stock options and restricted stock as specified in the terms of the 2006 Directors’ Plan, prorated in accordance with the number of months of service remaining in the fiscal year in which they were appointed. Additional grants under the 2006 Directors’ Plan may be made at the Board’s discretion.

 

The stock options granted during the 2008 fiscal year will become exercisable when the Average Closing Price, as defined in the 2006 Directors’ Plan, of our common stock appreciates 10% from the fair market value on the date of grant or on the fifth anniversary of the grant date, whichever comes first. On November 1, 2007, the Non-Employee Directors received a grant of 10,000 stock options, or 11,400 in the case of the Chairman and the Lead Director, at an option price of $42.49, which will become exercisable when the Average Closing Price of the common stock achieves $46.73 or on November 1, 2012, whichever comes first.

 

Restrictions will be removed from the restricted stock awards made in the 2008 fiscal year when the Average Closing Price of our common stock appreciates 10% from the fair market value on the date of grant, or on the fifth anniversary of the grant date, whichever comes first. On November 15,

 

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2007, the Non-Employee Directors received awards for 2,000 shares of restricted stock. Restrictions will be removed from the restricted stock when the Average Closing Price of our common stock achieves $48.72, or on November 15, 2012, whichever comes first.

 

Stock options and restricted stock granted under the 2006 Directors’ Plan will also become exercisable and have restrictions removed, respectively, when a Non-Employee Director ceases to serve on the Board, unless such service is terminated for cause, as defined in the 2006 Directors’ Plan. Restrictions are immediately lifted and options become immediately exercisable upon termination of service and remain exercisable for three years.

 

This excerpt taken from the COO DEF 14A filed Feb 6, 2008.

DIRECTOR COMPENSATION

 

Compensation of the Non-Employee Directors is reviewed by the Compensation Committee and approved by the Board based on the Compensation Committee’s recommendations. The responsibilities and time commitment involved for directors of a publicly traded company are substantial, and with recent changes in corporate governance standards, highly qualified and experienced directors are in high demand; therefore, the Compensation Committee seeks to provide appropriate economic incentives for the Company’s directors and to compensate them appropriately for their continued performance, workload and dedication. The Compensation Committee takes these factors into account in making recommendations to the Board with regard to changes in the Non-Employee Director compensation package.

 

The Compensation Committee also receives an analysis from their independent consultant, J. Richard & Co. (“J. Richard”), with regard to Non-Employee Director compensation. The Compensation Committee reviews and analyzes the information provided by J. Richard in determining whether to recommend to the Board that changes be made to current compensation levels for Non-Employee Directors. The total compensation awarded to the Non-Employee Directors is set at levels the Board believes are appropriate given the competitive market for qualified directors and the time commitment expected of the Non-Employee Directors. Director compensation is reviewed regularly and modified as the Board considers necessary or appropriate.

 

Stipends and Committee Chair Compensation

 

The Company compensates each Non-Employee Director based upon his or her service to the Company, including attendance at meetings and service on committees of the Board. Annual cash retainers, stipends for service as a committee chair, and equity compensation grants are designed to correspond to the relative responsibility of each director and are regularly reviewed to ensure they meet this standard.

 

Directors who are also employees of the Company receive no additional compensation for their service as directors.

 

For fiscal year 2007, each Non-Employee Director received a retainer of $30,000 for their services as a director of the Company. Dr. Rubenstein received an additional stipend of $10,000 per annum for his service as Lead Director in the 2007 fiscal year.

 

Chair Stipends and Meeting Payments

 

The Non-Employee Directors who served as Committee Chairs received an additional stipend in recognition of their time devoted to the Company in this capacity. Stipend amounts are structured to reflect the additional requirements placed on each committee chair.

 

Committee Chair Stipends:


    

Audit Committee Chair (Steven Rosenberg)

   $15,000 per year

Organization and Compensation Committee Chair (Michael Kalkstein)

   $12,000 per year

Corporate Governance Committee Chair (Donald Press)

   $10,000 per year

Nominating Committee Chair (Moses Marx)

   $1,000 per year

 

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The Non-Employee Directors are also compensated for attendance at meetings as follows:

 

Fee per Meeting:


    

Meetings held in person by the Board or any Committee of the Board

   $2,000 per meeting

Meetings held telephonically by the Board or any Committee of the Board and lasting more than 2 hours

   $2,000 per meeting

Meetings held telephonically by the Board or any Committee of the Board and lasting less than 2 hours

   $1,000 per meeting

 

In the event that more than one meeting occurs on the same day, Non-Employee Directors will not be compensated more than $2,000 per day for meeting attendance.

 

Non-Employee Directors are also compensated for time spent substantially on work for the Company at an hourly rate of $250, not to exceed $2,000 for any day. Non-Employee Directors will also be compensated, commencing November 1, 2007, for up to one travel day in connection with meetings, up to $2,000 per day.

 

Equity Compensation

 

In addition to cash compensation, the Non-Employee Directors participate in the 2006 Long-Term Incentive Plan for Non-Employee Directors (the “2006 Directors’ Plan”), which provides for annual equity grants in the form of restricted stock and stock options. The Board feels that Non-Employee Director compensation, like executive compensation, should contain a significant equity component in order to align director and stockholder interests. Grant dates, award amounts and vesting criteria for these annual equity grants are set by the terms of the 2006 Directors’ Plan.

 

The 2006 Directors’ Plan was approved by stockholders on March 21, 2006 and provides for two equity grants to the Non-Employee Directors each November as follows:

 

 

(a)

 

a grant of stock options on November 1st of 17,500 options to each Non-Employee Director (18,900 options in the case of the Lead Director), with an exercise price equal to 100% of the Fair Market Value (defined as the average of the high and low trading prices on the grant date as reported on http://finance.yahoo.com) of the Company’s common stock on the date of grant; and

 

 

(b)

 

a grant of restricted stock on November 15th which entitles each Non-Employee Director to purchase 1,000 shares of restricted stock at par value.

 

The stock options become exercisable when the Average Closing Price (as defined in the 2006 Directors’ Plan) of the Company’s common stock appreciates 10% from the Fair Market Value on the date of grant, or on the fifth anniversary of the grant date, whichever comes first. On November 1, 2006, the Non-Employee Directors received a grant of stock options at an option price of $57.87, which will become exercisable when the Average Closing Price of the common stock achieves $63.66 or on November 1, 2011, whichever comes first.

 

Restrictions are removed from the restricted stock awards when the Average Closing Price of the Company’s common stock appreciates 10% from the Fair Market Value on the date of grant (provided that date is not less than one year from the date of grant), or on the fifth anniversary of the grant date, whichever comes first. On November 15, 2006, the Non-Employee Directors received restricted stock awards. Restrictions will be removed from the restricted stock when the Average Closing Price of the Company’s common stock achieves $59.20 (but not before November 15, 2007), or on November 15, 2011, whichever comes first.

 

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Stock options and restricted stock granted under the 2006 Directors’ Plan will also become exercisable and have restrictions removed, respectively, when a Non-Employee Director ceases to serve on the Board, unless such service is terminated for cause (as defined in the 2006 Directors’ Plan). Restrictions are immediately lifted and options become immediately exercisable upon termination of service and remain exercisable for three years.

 

The 2006 Directors’ Plan also provides that, upon appointment to the Board, new Non-Employee Directors receive a grant of 17,500 stock options and 1,000 shares of restricted stock, prorated in accordance with the number of months of service remaining in the fiscal year in which they were appointed.

 

This excerpt taken from the COO DEF 14A filed Feb 6, 2007.

DIRECTOR COMPENSATION

 

The Company compensates each director who is not also an employee of the Company (a “Non-Employee Director”) based upon his or her service to the Company, including attendance at meetings and service on committees of the Board. Annual cash retainers and equity compensation grants are designed to correspond to the relative responsibility of each director and are regularly reviewed to ensure they meet this standard.

 

Cash Retainer and Meeting Fees for Non-Employee Directors

 

For fiscal year 2006, each Non-Employee Director received (a) a retainer of $30,000 for their services as a director of the Company, (b) applicable stipends and fees as set forth below for services as the chair of a committee of the Board and/or for attendance at meetings and (c) up to $1,500 per day for other days substantially spent on affairs of the Company. The Lead Director of the Board receives an additional stipend of $10,000 per annum for his service as Lead Director.

 

Committee Chair Stipends:


    

Audit Committee

   $ 15,000 per annum

Organization and Compensation Committee

   $ 12,000 per annum

Corporate Governance Committee

   $ 10,000 per annum

Nominating Committee

   $ 1,000 per annum

Fee per Meeting:


    

Convened in person* or convened telephonically and lasting more than 2 hours

   $ 1,500 per meeting

Convened telephonically for less than 2 hours

   $ 750 per meeting

*   Committee meetings convened in person on the same day as a Board meeting convened in person are not compensated separately from the Board meeting.

 

For fiscal year 2007, each Non-Employee Director will be compensated in the same amounts as above, with the following changes to fees paid for meetings:

 

Fee per Meeting:


    

Convened in person* or convened telephonically and lasting more than 2 hours

   $ 2,000 per meeting

Convened telephonically for less than 2 hours

   $ 1,000 per meeting

*   Committee meetings convened in person on the same day as a Board meeting convened in person are not compensated separately from the Board meeting.

 

Equity Compensation of Non-Employee Directors

 

2006 Long-Term Incentive Plan Awards

 

In addition to cash compensation, our Non-Employee Directors participate in the 2006 Long-Term Incentive Plan for Non-Employee Directors (the “2006 Directors’ Plan”), which provides for annual equity grants of restricted stock and stock options to the Non-Employee Directors for their service. The 2006 Directors’ Plan was approved by stockholders on March 21, 2006 and provides for grants each November of both restricted stock and stock options as follows:

 

 

(a)

 

a grant of stock options on each November 1st of 17,500 options to each Non-Employee Director (18,900 options in the case of the Lead Director), with an exercise price equal to 100% of the Fair Market Value (defined as the average of the high and low trading prices) of the common stock of the Company on the date of grant, and

 

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  (b)   a grant of restricted stock on each November 15th which entitles each Non-Employee Director to purchase 1,000 shares of restricted stock at par value.

 

The stock options become exercisable when the Average Closing Price (as defined in the 2006 Directors’ Plan) of the Company’s common stock over 30 calendar days, as reported on http://finance.yahoo.com, appreciates 10% from the Fair Market Value on the date of grant or five years have passed, whichever comes first. On November 1, 2006, the Non-Employee Directors received a grant of stock options at an option price of $57.87, which will become exercisable when the Average Closing Price of the common stock achieves $63.66 or on November 1, 2011, whichever comes first.

 

Restrictions are removed from the restricted stock when the Average Closing Price of the Company’s common stock over 30 calendar days, as reported on http://finance.yahoo.com, appreciates 10% from the date of grant or five years have passed, whichever comes first. On November 15, 2006, the Non-Employee Directors received restricted stock awards. Restrictions will be removed from the restricted stock when the Average Closing Price of the Company’s common stock achieves $59.20 or on November 15, 2011, whichever comes first.

 

Stock options and restricted stock granted under the 2006 Directors’ Plan will also become exercisable and have restrictions removed, respectively, when a Non-Employee Director ceases to serve on the Board, unless such service is terminated for Cause (as defined in the 2006 Directors’ Plan). Restrictions are immediately lifted and options become immediately exercisable upon termination of service and remain exercisable for three years.

 

The 2006 Directors’ Plan also provides that, upon appointment to the Board, new Non-Employee Directors receive a grant of 17,500 stock options and 1,000 shares of restricted stock, prorated in accordance with the number of months of service remaining in the fiscal year in which they were appointed. Accordingly, upon her election to the Board on March 21, 2006, Ms. Lindell received: (a) a grant of 11,667 stock options, with an exercise price of $55.33, and (b) the option to purchase 667 shares of restricted stock at par value. The stock options will become exercisable and the restrictions will be removed from the restricted stock when the Average Closing Price of the Company’s common stock achieves $60.86 or on March 21, 2011, whichever comes first.

 

1996 Long-Term Incentive Plan Awards

 

Prior to its expiration on November 16, 2005, the Non-Employee Directors participated in the 1996 Long-Term Incentive Plan for Non-Employee Directors (the “1996 Directors’ Plan”) which provided for grants on the same terms and in the same quantities as the 2006 Directors’ Plan.

 

Under the 1996 Directors’ Plan, on November 1, 2005, the Non-Employee Directors received a grant of stock options at an option price of $69.01 which will become exercisable when the Average Closing Price (as defined in the 1996 Directors’ Plan) of the common stock achieves $75.91 or on November 1, 2010, whichever comes first. Also under the 1996 Directors’ Plan, on November 15, 2005, the Non-Employee Directors received restricted stock awards. Restrictions will be removed from the restricted stock when the Average Closing Price of the Company’s common stock achieves $77.91 or on November 15, 2010, whichever comes first.

 

The 1996 Directors’ Plan also provided that, upon appointment to the Board, new Non-Employee Directors receive a grant of 17,500 stock options and 1,000 shares of restricted stock, prorated in accordance with the number of months of service remaining in the fiscal year in which they were appointed. Accordingly, upon his election to the Board in connection with the acquisition of Ocular Sciences on January 7, 2005, Mr. Fruth received: (a) a grant of 14,583 stock options, with an exercise price of $72.94, and (b) the option to purchase 834 shares of restricted stock at par value. The stock

 

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options became exercisable and the restrictions were removed from the restricted stock on March 7, 2005 when the Average Closing Price of the common stock achieved $80.23.

 

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