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(4)
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(5)
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Amount Previously Paid:
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(2)
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Form, Schedule or Registration Statement No.:
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Filing Party:
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(4)
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Date Filed:
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(1) |
To elect directors;
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(2) |
To ratify the selection of independent accountants by the Audit Committee of the Board of Directors;
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(3) |
To hold an advisory vote to approve executive compensation;
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(4) |
To consider a stockholder proposal requesting a semi-annual report on (a) the Company’s policies on political spending and (b) political contributions made;
and
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(5) |
To transact any other business properly brought before the meeting.
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Naomi C. Dallob
Secretary
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PAGE
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||
CONSIDERATION OF 2018 SAY ON PAY VOTE
|
1 |
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2018 COMPENSATION
|
1 | |
2018 PERFORMANCE
|
1 | |
PROXY STATEMENT
|
4 | |
Stockholders Entitled to Vote
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4
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Quorum
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4
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Vote Requirements
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5
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How to Vote
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5
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PROPOSAL 1 – ELECTION OF DIRECTORS
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General |
6 | |
Nominees
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7
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Recommendation
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9
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CORPORATE GOVERNANCE
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9 |
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Narrative Disclosure to Director Compensation Table
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9
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Directors Emeriti
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11
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Majority Voting in Director Elections | 11 | |
Committees and Meetings of the Board
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12
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Procedures Regarding Director Candidates Recommended by Stockholders
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12
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Director Independence
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13
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Board Risk Oversight
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13
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Compensation Risk | 14 |
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Compensation Committee Interlocks and Insider Participation |
14 |
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Board Leadership Structure; Related Person Transactions
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14
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Code of Ethics
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15
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Stockholder Communications
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15
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COMPENSATION DISCUSSION AND ANALYSIS
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15 |
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Consideration of the 2018 Say On Pay Vote
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15
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Overview of Compensation Program
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16
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How Compensation Decisions are Made
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16
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Role of Executive Officers
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17
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Objectives of Compensation Program
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17
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Elements of Executive Compensation
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17
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Executive Compensation Consultant, Independence
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17
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Peer Group
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18
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Base Salaries
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18
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Annual Non Equity Incentive Compensation
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19
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Long-Term Incentives
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21
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Retirement Benefits
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23
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Tax Considerations
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24
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Employment Agreements
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24
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Stock Ownership Guidelines
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26
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REPORT OF THE COMPENSATION COMMITTEE
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26 |
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EXECUTIVE COMPENSATION
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27 |
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Summary Compensation
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27
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All Other Compensation Table
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28
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Grants of Plan-Based Awards
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29
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Narrative to Summary Compensation Table and Grants of Plan-Based Awards Table
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30
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Employment Agreements
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30
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Annual Cash Incentives
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31
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Stock Incentive Plans
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31
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Outstanding Equity Awards at Fiscal Year End
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33
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Option Exercises and Stock Vested | 35 |
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Nonqualified Deferred Compensation
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36
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Excess Benefit Plan and Deferred Compensation Plan
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36
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Potential Payments Upon Termination or Change in Control
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37
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Executive Pay Ratio
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43
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TRANSACTIONS WITH RELATED PERSONS
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43 |
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SECURITY OWNERSHIP
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Security Ownership of Certain Beneficial Owners
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44
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Security Ownership of Executive Officers and Directors
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45
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SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING
COMPLIANCE
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46 |
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CLAWBACK POLICY
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46 |
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ANTI-HEDGING POLICY
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46 |
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PROPOSAL 2 – RATIFICATION OF SELECTION OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
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46 |
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Recommendation
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46
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REPORT OF THE AUDIT COMMITTEE
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47 |
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PRINCIPAL ACCOUNTANT FEES AND SERVICES
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48 |
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PROPOSAL 3 – ADVISORY VOTE ON EXECUTIVE COMPENSATION
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48 |
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Recommendation
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49
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PROPOSAL 4 – STOCKHOLDER PROPOSAL ON POLITICAL
SPENDING
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49 |
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Recommendation
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51
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PROPOSALS FOR THE NEXT ANNUAL MEETING
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51 |
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Proposals to be Included in Our 2020 Proxy Statement
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51
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Stockholder Proposals Regarding Nominations or Other Business at the 2019 Annual Meeting
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51
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IMPORTANT NOTICE REGARDING AVAILABILITY OF PROXY MATERIALS FOR ANNUAL MEETING
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52 |
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OTHER INFORMATION
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53 |
●
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Replacement of the previous annual incentive program, which was based on a multiple of historical growth rates in Adjusted EPS
applied to prior year actual payouts, with a target bonus plan based on achieving goals related to Adjusted EPS and Return on Assets;
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●
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Replacement of the previous long-term incentive plan with performance share units subject to performance-based vesting related
to a cumulative three-year Adjusted EPS target and a three-year relative TSR performance metric. Prior to 2013, time-based restricted stock awards generally cliff vested on the fourth anniversary of the grant date;
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●
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A policy that, beginning in 2013, stock incentive compensation is subject to a “double trigger” in the event of a change in
control of the Company. New incentives vest only upon employment termination without good cause or for good reason after a change in control; and
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●
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A clawback policy such that the Compensation Committee will review all performance-based compensation awarded to or earned by
certain officers during the three-year period prior to any restatement of the Company’s financial results. If the Compensation Committee determines such compensation would have been lower had it been calculated based on the restated
financial statement, the Compensation Committee may seek to recover the excess amount.
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●
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Additionally, in 2018, the Board of Directors amended The Senior Executive Severance Policy and the Change in Control Plan to
limit any gross-up payments payable under the plans to the then-existing participants in the plans.
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(1) Adjusted Diluted EPS; See next page for reconciliation from GAAP reported results to adjusted (non-GAAP) results
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(2) Adjusted for stock split
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(1)
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(2)
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(3)
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(4)
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(5)
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(6)
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(7)
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(8)
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(9)
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(10)
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(11)
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(12)
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(13)
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(14)
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(15)
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(16)
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2003
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2004
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2005
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2006
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2007
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2008
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2009
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2010
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2011
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2012
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2013
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2014
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2015
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2016
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2017
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2018
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Reconciliation of
Adjusted Net Income
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(1)
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Net income/(loss) |
$
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(3,435
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)
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$
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27,512
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$
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35,817
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$
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50,651
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$
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61,641
|
$
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67,281
|
$
|
73,784
|
$
|
81,831
|
$
|
85,979
|
$
|
89,304
|
$
|
77,227
|
$
|
99,317
|
$
|
110,274
|
$
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108,743
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$
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98,177
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$
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205,544
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||||||||||||||||||||||||||||||||
Add/(deduct): |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(2)
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Discontinued operations
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14,623
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(8,417
|
)
|
411
|
7,071
|
(1,201
|
)
|
1,088
|
253
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||||||||||
(3)
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(Gains)/losses on investments
|
(3,351
|
)
|
-
|
-
|
918
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||||||||||||||||||||||||||
(4)
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Gain on sale of property
|
-
|
-
|
-
|
-
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(724
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)
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||||||||||||||||||||||||||
(5) |
Impairment loss on transportation
equipment
|
- |
- |
- | - |
- | 1,714 | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||
(6)
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Severance charges
|
2,358
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(7)
|
Dividend income from VITAS
|
(1,379
|
)
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||||||||||||||||||||||||||
(8)
|
Equity in earnings of VITAS
|
(922
|
)
|
4,105
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||||||||||||||||||||||||||
(9)
|
Long-term incentive compensation
|
-
|
5,437
|
3,434
|
-
|
4,427
|
-
|
3,134
|
2,957
|
1,880
|
228
|
822
|
1,625
|
4,752
|
1,221
|
3,243
|
5,307
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(10)
|
Loss/(gain) on extinguishment of debt
|
-
|
2,030
|
2,523
|
273
|
8,778
|
(2,156
|
)
|
-
|
-
|
-
|
-
|
294
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||||||||||||||||||||||||||
(11)
|
Legal expenses of OIG investigation
|
-
|
-
|
397
|
662
|
141
|
28
|
363
|
627
|
737
|
752
|
1,333
|
1,328
|
3,072
|
3,248
|
3,207
|
-
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(12)
|
Stock option expense
|
-
|
-
|
137
|
769
|
2,962
|
4,619
|
5,464
|
4,909
|
5,298
|
5,143
|
3,813
|
3,022
|
3,439
|
5,266
|
6,892
|
10,118
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(13)
|
Lawsuit settlement
|
-
|
1,897
|
10,757
|
169
|
1,168
|
-
|
534
|
1,126
|
1,397
|
617
|
16,926
|
74
|
3
|
28
|
52,504
|
594
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(14)
|
Prior period tax adjustments
|
-
|
(1,620
|
)
|
(1,961
|
)
|
(2,115
|
)
|
-
|
(322
|
)
|
-
|
-
|
-
|
-
|
(1,782
|
)
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||||||||||||||||||||||
(15)
|
Debt registration expenses
|
-
|
727
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||||||||||||||||||||||||||||
(16)
|
VITAS transactions costs
|
-
|
222
|
(959
|
)
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||||||||||||||||||||||||||
(17)
|
Prior period insurance adjustments
|
-
|
-
|
(1,014
|
)
|
-
|
-
|
358
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||||||||||||||||||||||||||
(18)
|
Non-cash interest on convertible debt
|
-
|
-
|
-
|
-
|
2,335
|
3,228
|
3,988
|
4,313
|
4,664
|
5,041
|
5,448
|
2,143
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(19) |
Income tax impact of non-taxable investments | - | - | - |
- | 46 | 3,062 | (756 | ) |
- | - |
- | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||||||||||
(20)
|
Expenses associated with contested proxy solitication
|
- | - | - | - | - | - | 2,525 |
- | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||
(21)
|
Acquisition Expenses
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
198
|
75
|
114
|
38
|
15
|
104
|
-
|
-
|
559
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(22)
|
Costs to Shut down HVAC operations
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
649
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(23)
|
Securities litigation
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
469
|
69
|
207
|
23
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(24)
|
Severance arrangements
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
184
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(25)
|
Early retirement expenses
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
2,840
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(26)
|
Medicare cap sequestration adjustment
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
141
|
276
|
1,114
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(27)
|
Other
|
-
|
-
|
-
|
(296
|
)
|
(296
|
)
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||||||||||
(28)
|
Excess tax benefits on stock compensation
|
- | - |
- | - | - | - | - | - | - | - | - | - | - |
- | (18,932 | ) |
(22,862 | ) |
|||||||||||||||||||||||||||||||||||||||||||||||
(29)
|
Impact of tax reform
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(8,302
|
)
|
-
|
||||||||||||||||||||||||||||||||||||||||||||||||
(30)
|
Loss on sale of transportation equipment
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
3,314
|
-
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(31)
|
Program closure expenses
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
675
|
-
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(32)
|
Adjusted net income
|
$
|
7,894
|
$
|
31,893
|
$
|
49,542
|
$
|
58,102
|
$
|
79,277
|
$
|
78,900
|
$
|
89,289
|
$
|
95,961
|
$
|
100,030
|
$
|
102,317
|
$
|
104,372
|
$
|
107,731
|
$
|
121,667
|
$
|
121,487
|
$
|
141,054
|
$
|
200,374
|
Proposal
|
Vote Required
|
Voting Options
|
Effect of
Abstentions
|
Broker
Discretionary
Voting
Allowed?
|
Effect of
Broker
Non-Votes
|
Recommended
Vote
|
Election of Directors (Proposal 1)
|
Votes cast for exceed votes cast against
|
FOR, AGAINST or ABSTAIN
|
No effect, not treated as a “vote cast”
|
No
|
No effect, not treated as a
“vote cast”
|
FOR
|
Ratification of Auditor Appointment
(Proposal 2)
|
Majority of shares with voting power present in person or represented by proxy
|
FOR, AGAINST or ABSTAIN
|
Treated as a vote AGAINST the proposal
|
Yes
|
Not applicable
|
FOR
|
Non-Binding
Advisory Vote on Executive Compensation
(Say On Pay)
(Proposal 3)
|
Majority of shares with voting power present in person or represented by proxy
|
FOR, AGAINST or ABSTAIN
|
Treated as a vote AGAINST the proposal
|
No
|
No effect – not entitled to vote
|
FOR
|
Stockholder Proposal Regarding
Political Spending
(Proposal 4)
|
Majority of shares with voting power present in person or represented by proxy
|
FOR, AGAINST or ABSTAIN
|
Treated as a vote AGAINST the proposal
|
No
|
No effect – not entitled to vote
|
AGAINST
|
●
|
Vote by Mail: You can vote your
shares by mail by completing, signing, dating and returning your proxy card in the postage-paid envelope provided. In order for your proxy to be validly submitted and for your shares to be voted in accordance with your
instructions, we must receive your mailed proxy card by 11:59 p.m. Central Time on May 19, 2019.
|
●
|
Vote by Telephone: You can also
vote your shares by calling the number (toll-free in the United States and Canada) indicated on your proxy card at any time and following the recorded instructions. If you submit your proxy by telephone, then you may submit your
voting instructions up until 11:59 p.m. Central Time on May 19, 2019. If you are a beneficial owner, or you hold your shares in “street name” as described below, please contact your bank, broker or other holder of record to
determine whether you will be able to vote by telephone.
|
●
|
Vote via the Internet: You can
vote your shares via the Internet by going to the Web site address for Internet voting indicated on your proxy card and
following the steps outlined on the secure Web site. If you submit your proxy via the Internet, then you may submit your voting instructions up until 11:59 p.m. Central Time on May 19, 2019. If you are a beneficial owner, or you
hold your shares in “street name”, please contact your bank, broker or other holder of record to determine whether you will be able to vote via the Internet.
|
Kevin J. McNamara
Director since 1987 Age: 65 |
Mr. McNamara’s experience, qualifications, attributes and skills include serving as President and Chief Executive Officer of the
Company. He has held these positions since August 1994 and May 2001, respectively. Previously, he served as Executive Vice President, Secretary and General Counsel from November 1993, August 1986 and August 1986, respectively, to
August 1994.
|
Joel F. Gemunder
Director since 1977 Age: 79 |
Mr. Gemunder’s experience, qualifications, attributes and skills include having served as President and Chief Executive Officer
of Omnicare, Inc., Cincinnati, Ohio (healthcare products and services) (“Omnicare”). Omnicare, a former Fortune 500 Company acquired by CVS Health Corporation in 2015, is a leading provider of pharmaceutical and related services
for seniors serving residents of skilled nursing, assisted living, and other healthcare facilities across the United States. He retired from these positions in August 2010, having served since May 1981 and May 2001, respectively.
Omnicare is a former equity investee of the Company that became a publicly owned corporation in 1981 and has not been a Chemed affiliate since at least 1996. He was a director of Omnicare until his August 2010 retirement and a
director of Ultratech, Inc. until his decision not to run for re-election at the 2016 meeting.
|
Patrick P. Grace
Director since 1996 Age: 63 |
Mr. Grace’s experience, qualifications, attributes and skills include serving in various executive positions at W.R. Grace &
Co. from 1977 to 1995, most recently as President and CEO of Grace Logistics, Inc., an operating company with oversight responsibility for Grace’s $5.0 billion global supply chain. He is currently President and CEO of Grace
Institute Foundation. From 1996 to 2017, he served as Chairman of the Grace Institute, New York, New York (workforce development for women). He was the co-founder and managing Principal of Apollo Philanthropy Partners, L.L.C., New
York, New York (philanthropic advisory services) from 2008 to 2012. From 1996 to 2017 he served as President of MLP Capital, Inc., New York, New York, an investment holding company which managed several real estate and mining
interests in the southeastern United States. From 2008 to 2017 he served as Chairman of KickStart International, a global poverty alleviation organization. He also serves as a director of TONIX Pharmaceuticals, Inc., New York, New
York (specialty pharmaceutical product development and commercialization). He earned a Master’s of Business Administration degree in finance from Columbia University.
|
Thomas C. Hutton
Director since 1985 Age: 68 |
Mr. Hutton’s experience, qualifications, attributes and skills include serving as a Vice President of the Company. He has held
this position since February 1988. Previously, Mr. Hutton, who has a J.D. and Master’s of Public Administration degree from Cornell University, practiced corporate law in New York concentrating in securities and regulatory law from
1977 to 1987. He served as a director of Omnicare from May 1983 to May 2001. Currently Mr. Hutton serves as a trustee on three private foundations including the Chemed Foundation.
|
Walter L. Krebs
Director from May 1989 to April 1991,
May 1995 to May 2003 and since May 2005
Age: 86
|
Mr. Krebs’ experience, qualifications, attributes and skills include having served as Senior Vice President-Finance, Chief
Financial Officer and Treasurer of Service America Systems, Inc. (home and service warranties), a then-wholly owned subsidiary of the Company (“Service America”). We sold Service America in 2005. He retired from this position in
July 1999, having held the position since October 1997. Previously, he was a Director-Financial Services of DiverseyLever, Inc. (formerly known as Diversey Corporation), Detroit, Michigan (specialty chemicals) (“Diversey”), from
April 1991 to April 1996. Previously, from January 1990 to April 1991, he was Senior Vice President and the Chief Financial Officer of the Company’s then-wholly owned subsidiary, DuBois Chemicals, Inc. (specialty chemicals)
(“DuBois”). We sold DuBois in 1991.
|
Andrea R. Lindell
Director since May 2008 Age: 75 |
Ms. Lindell’s experience, qualifications, attributes and skills include having served as Dean and a Professor of the College of
Nursing at the University of Cincinnati. She retired from these positions in January 2011 having held them since December 1990. She is currently Professor Emeritus at the college. Since January 2016 she has served as Dean, having
held the title of Associate Dean from January 2013 to January 2016, previously holding the title of Interim Associate Dean from August 2011, at the School of Nursing, Walden University. She is also Vice-Provost of Walden’s College
of Health Sciences. Walden offers online degrees as follows: BSN, MSN, DNP. Ms. Lindell was also Associate Senior Vice President of the Medical Center at the University of Cincinnati from July 1998 until January 2011. The College
of Nursing’s programs include over 1,500 students, and offer the following degrees: BSN, MSN, Post MSN, and PhD. From September 1994 to June 2002, she also held an additional position as Founder and Interim Dean of the College of
Allied Health Sciences at the University of Cincinnati. She was a director of Omnicare until May 2014.
|
Thomas P. Rice
Director since May 2009
Age: 69
|
Mr. Rice’s experience, qualifications, attributes and skills include having served as Chief Executive Officer of Andrx
Corporation, Fort Lauderdale, Florida (specialty pharmaceuticals) (“Andrx”), from February 2004 to November 2006, when Andrx was sold to Watson Pharmaceuticals. Following the sale, Mr. Rice returned as General Manager and Majority
Partner of Columbia Investments LLC, Baltimore, Maryland, which invests in local emerging businesses in Baltimore and which Mr. Rice co-founded in January 1996. He was also a Director of Par Pharmaceuticals, Woodcliff Lake, NJ
(drug development, manufacture, and marketing) until November 2012. From January 1999 to March 2003, he was President and Chief Executive Officer of Chesapeake Biological Laboratories, Inc., Solomons, Maryland (pharmaceuticals
manufacturing) (“Chesapeake”). Before co-founding Columbia Investments LLC, Mr. Rice served as Executive Vice President and Chief Operating Officer of Circa Pharmaceuticals, Inc., Copiague, New York (pharmaceuticals manufacturing)
(“Circa”), from June 1993 to January 1996. Mr. Rice was also the Chief Financial Officer of Circa from June 1993 to January 1995. Prior to joining Circa, Mr. Rice spent seven years as an accountant with Deloitte & Touche LLP,
an international accounting firm. He earned a Master’s degree in finance from Loyola University. He was a director of Circa from June 1993 to January 1996, a director of Chesapeake from January 1997 to January 1999 and a director
of Andrx from April 2003 to November 2006.
|
Donald E. Saunders
Director from May 1981 to May 1982,
May 1983 to May 1987 and since May 1998
Age: 74
|
Mr. Saunders’ experience, qualifications, attributes and skills include having served as a Professor at the Farmer School of
Business, Miami University, Oxford, Ohio. He held this position from August 2001 until his retirement in January 2015. Miami University is a public university with a student population of 16,000. He earned a doctorate in
Economics, with a minor in Accounting, from Indiana University. He has taken Masters level courses in financial reporting, financial valuation, and risk management. Mr. Saunders retired as President of DuBois, then a division of
Diversey, in October 2000, having held that position since November 1993.
|
George J. Walsh III
Director since 1995 Age: 73 |
Mr. Walsh’s experience, qualifications, attributes and skills include serving as a partner with the law firm of Thompson Hine
LLP, New York, New York. He has held this position since May 2002. Prior to this date, Mr. Walsh was a partner with the law firm of Gould & Wilkie LLP, New York, New York, and held this position since January 1979. Gould
& Wilkie merged with Thompson Hine on May 1, 2002. Mr. Walsh was elected the Chairman of the Board of Directors in March 2009.
|
Frank E. Wood
Director since 2002 Age: 76 |
Mr. Wood’s experience, qualifications, attributes and skills include serving since 1994 as President and Chief Executive Officer
of SecretWorks, LLC (“Secret”), Cincinnati, Ohio. Secret was in the radio broadcast business, but following the sale of radio stations, it is now a venture capital company. Investments have included banking, internet security,
anti-counterfeiting, meat exporting, medical office advertising, magazine publishing, and aviation. Mr. Wood is a graduate of Harvard College and earned a J.D. degree from The University of Chicago Law School.
|
Name
|
Fees Earned
or Paid in
Cash
($)
|
Stock
Awards
($)(b)
|
All Other
Compensation
($)
|
Total
($)
|
||||
Joel F. Gemunder
|
81,000
|
91,106
|
-
|
172,106
|
||||
Patrick P. Grace
|
115,500
|
91,106
|
-
|
206,606
|
||||
Walter L. Krebs
|
82,000
|
91,106
|
-
|
173,106
|
||||
Sandra E. Laney
|
20,000
|
91,106
|
-
|
111,106
|
||||
Andrea R. Lindell
|
82,000
|
91,106
|
-
|
173,106
|
||||
Thomas P. Rice
|
89,500
|
91,106
|
-
|
180,606
|
||||
Donald E. Saunders
|
91,500
|
91,106
|
-
|
182,606
|
||||
George J. Walsh III
|
245,000
|
91,106
|
-
|
336,106
|
||||
Frank E. Wood
|
82,000
|
91,106
|
-
|
173,106
|
(a) |
The Director Compensation Table excludes executive compensation figures for Messrs. McNamara and Hutton who are employees of the Company. |
|
|
(b) |
Amounts for each of Messrs. Germunder, Grace, Krebs, Rice, Saunders, Walsh, Wood, Ms. Lindell and Ms. Laney include contributions of $6,000 of Capital Stock held in the Chemed Director Deferred Compensation Plan.
|
Director
|
Audit
Committee
|
Compensation
Committee
|
Nominating
Committee
|
J. F. Gemunder
P. P. Grace*
W. L. Krebs
A. R. Lindell
T. P. Rice*
D. E. Saunders*
G. J. Walsh III
F. E. Wood
|
Chair
x
x
|
x
x
Chair
x
|
x
Chair
x
|
Number of Meetings
|
7
|
4
|
1
|
●
|
Replacement of the previous annual incentive program, which was based on a multiple of historical growth rates in Adjusted
EPS applied to prior year actual payouts, with a target bonus plan based on achieving goals related to Adjusted EPS and Return on Assets;
|
●
|
Replacement of the previous long-term incentive plan with performance share units subject to performance-based vesting
related to a cumulative three-year Adjusted EPS target and a three-year relative TSR performance metric. Prior to 2013, time-based restricted stock awards generally cliff vested on the fourth anniversary of the grant date;
|
●
|
A policy that, beginning in 2013, stock incentive compensation is subject to a “double trigger” in the event of a change in
control of the Company. New incentives vest only upon employment termination without good cause or for good reason after a change in control; and
|
●
|
A clawback policy such that the Compensation Committee will review all performance-based compensation awarded to, or earned
by, certain officers during the three-year period prior to any restatement of the Company’s financial results. If the Compensation Committee determines such compensation would have been lower had it been calculated based on the
restated financial statement, the Compensation Committee may seek to recover the excess amount.
|
●
|
Additionally, in 2018, the Board of Directors amended The Senior Executive Severance Policy and the Change in Control
Plan to limit any gross-up payments payable under the plans to the then-existing participants in the plans.
|
ABM Industries, Inc. |
Five Star Senior Living Inc. |
|
Acadia Healthcare Co., Inc. |
Healthcare Services Group |
|
Amedisys, Inc. |
LHC Group, Inc. |
|
Bioscrip, Inc. |
Mednax, Inc. |
|
Brookdale Senior Living, Inc. |
National Healthcare Corp. |
|
Capital Senior Living Corp. |
Radnet, Inc. |
|
Clean Harbors, Inc. |
Rollins, Inc. |
|
Comfort Systems USA, Inc. |
Team, Inc. |
|
Ensign Group, Inc. |
Tetra Tech, Inc. |
|
|
Tivity Health, Inc. |
K. J. McNamara |
125 |
% |
|
|
|
D. P. Williams
|
105 |
|
|
|
|
N. M. Westfall |
105 |
|
|
|
|
S. S. Lee |
105 |
|
|
|
|
N. C. Dallob |
75 |
|
2018 Actual/Target | |||||||||
|
Adjusted
E.P.S.
|
Return on
Total Assets
|
|||||||
(75%) | (25%) | ||||||||
VITAS
|
|||||||||
(1)
|
Actual |
$
|
8.55
|
26.2
|
%
|
||||
(2)
|
Target |
7.61
|
24.0
|
% | |||||
(3)
|
Percent of Target |
112.4
|
% |
109.2
|
% | ||||
(4)
|
Target Multiplier |
189.7
|
% |
122.9
|
% | ||||
Roto-Rooter
|
|||||||||
(5) | Actual | $ | 6.05 | 33.7 | % | ||||
(6) | Target | 4.96 | 28.9 | % | |||||
(7) | Percent of Target | 122.0 | % | 116.6 | % | ||||
(8) | Target Multiplier | 200.0 | % | 141.5 | % | ||||
Chemed Consolidated | |||||||||
(9) | Actual | $ | 12.13 | 21.6 | % | ||||
(10) | Target | 10.61 | 18.7 | % | |||||
(11) | Percent of Target | 114.3 | % | 115.5 | % | ||||
(12) | Target Multiplier | 200.0 | % | 138.8 | % |
NEO
|
2018 Target Non
Equity Incentive |
2018 Actual
Non Equity Incentive Earned |
Actual as a
% of Target |
|||||||||
K. J. McNamara
|
$
|
1,465,000
|
$
|
2,705,855
|
184.7
|
%
|
||||||
D. P. Williams
|
682,500
|
1,260,578
|
184.7
|
|||||||||
N. M. Westfall
|
517,545
|
895,353
|
173.0
|
|||||||||
S. S. Lee
|
462,630
|
857,600
|
185.4
|
|||||||||
N. C. Dallob
|
306,000
|
565,182
|
184.7
|
|
As Reported in
|
As Used for
|
||||||
|
Charts on
|
NEIC
|
||||||
|
Pages 2 and 3
|
Calculation
|
||||||
Net Income as Reported (000)
|
$
|
205,543
|
$
|
205,543
|
||||
Adjustments as Outlined on Page 3
|
$
|
(5,170
|
)
|
$
|
(5,170
|
) |
||
Adusted Net Income as Outlined on Page 3
|
$ | 200,373 |
$ |
200,373 |
||||
Additional Adjustments for Non Equity Incentive Compensation
|
||||||||
Out of Pocket Acquisition Costs
|
$ |
(559 |
) |
|||||
Medicare Cap Charge - Fourth Quarter 2017
|
$ |
(1,321 |
) |
|||||
Medicare Cap Charge - Fourth Quarter 2018
|
$ |
2,217 |
||||||
Adjusted Net Income to be used for NEIC Calculations
|
$ |
200,710 |
||||||
|
||||||||
Average Shares Outstanding Diluted (000)
|
16,803 |
|||||||
Actual Shares Outstanding for NEIC Calculation (actual as of 12/31/18)
|
16,550 |
|||||||
|
||||||||
Adjusted Net Income Per Share
|
$ |
11.93 |
$ |
12.13 |
3-Year Adjusted EPS
CAGR
|
Percentage of
Target Shares |
|
Maximum
|
11%
|
200.0%
|
Target
|
7%
|
100.0%
|
Minimum
|
3%
|
0.0%
|
3-Year TSR
Percentile
|
Percentage of
Target Shares |
|
Maximum
|
Greater than 90th
|
200.0%
|
75th
|
150.0%
|
|
60th
|
125.0%
|
|
Target
|
50th
|
100.0%
|
40th
|
75.0%
|
|
25th
|
50.0%
|
|
Minimum
|
Less than 25th
|
0.0%
|
Adjusted EPS Avg.
Annual CAGR |
TSR Peer Group Percentile |
|||||||||||||||
Performance Period |
Percent |
Payout
(a) |
Percentile |
Payout
(a) |
||||||||||||
3-Year Performance Period Targets
|
7.00
|
%
|
100.0
|
%
|
50th |
100.0
|
%
|
|||||||||
January 1, 2013 - December
31, 2015
|
10.26
|
144.4
|
73rd |
149.8
|
||||||||||||
January 1, 2014 - December
31, 2016
|
8.23
|
118.0
|
91st |
204.6
|
||||||||||||
January 1, 2015 - December
31, 2017
|
11.79
|
163.0
|
90th |
203.9
|
||||||||||||
January 1, 2016 - December
31, 2018
|
20.52
|
203.3
|
70th |
144.0
|
a) |
termination of employment by the Company without cause; or
|
b) |
termination of employment by the employee within 90 days of an event giving him or her good reason to so terminate.
|
Name and
Principal
Position
|
Year |
Salary
($)
|
Non-Equity
Incentive Plan
Compensation
($)
|
Stock
Awards
($)(a)
|
Option
Awards
($)(a)
|
Non-Qualified
Deferred
Compensation
Earnings
($)(b)
|
All Other
Compensation
($)(c)
|
Total
($)
|
|||||||||||||||||||||
K.J. McNamara | |||||||||||||||||||||||||||||
President and CEO | 2018 |
$ | 1,149,908 | $ | 2,705,855 | $ | 1,676,824 | $ | 2,014,815 | $ | 22,299 | $ | 1,208,936 | $ | 8,778,637 | ||||||||||||||
2017 |
1,094,990 | 2,247,732 | 921,376 | 2,544,850 | 22,572 | 1,102,997 | 7,934,517 | ||||||||||||||||||||||
2016 |
1,047,013 | 1,737,761 | 628,213 | 2,064,792 | 22,509 | 1,041,041 | 6,541,329 | ||||||||||||||||||||||
D.P. Williams | |||||||||||||||||||||||||||||
Executive Vice | 2018 |
637,667 | 1,260,578 | 671,071 | 1,040,988 | 10,309 | 568,309 | 4,188,922 | |||||||||||||||||||||
President and CFO
|
2017 |
607,000 | 1,046,736 | 368,631 | 925,400 | 10,435 | 459,800 | 3,418,002 | |||||||||||||||||||||
2016 |
580,000 | 770,525 | 224,500 | 708,351 | 10,407 | 433,935 | 2,727,718 | ||||||||||||||||||||||
N.M. Westfall (d) | |||||||||||||||||||||||||||||
Executive Vice President | 2018 |
481,275 | 895,353 | 502,877 | 906,667 | - | 282,124 | 3,068,296 | |||||||||||||||||||||
2017 |
458,750 | 619,833 | 288,736 | 906,892 | - | 203,989 | 2,478,200 | ||||||||||||||||||||||
2016 |
404,896 | 527,963 | 89,744 | 818,640 | - | 185,308 | 2,026,551 | ||||||||||||||||||||||
S.S. Lee | |||||||||||||||||||||||||||||
Executive Vice President | 2018 |
429,733 | 857,600 | 360,296 | 537,284 | 10,122 | 488,022 | 2,683,057 | |||||||||||||||||||||
2017 |
400,333 | 797,360 | 202,504 | 416,430 | 10,248 | 328,576 | 2,155,451 | ||||||||||||||||||||||
2016 |
375,000 | 632,844 | 134,756 | 309,264 | 10,219 | 325,343 | 1,787,426 | ||||||||||||||||||||||
N.C. Dallob (e) | |||||||||||||||||||||||||||||
Vice President, | 2018 |
400,333 | 565,182 | 276,625 | 483,556 | 6,104 | 238,227 | 1,970,027 | |||||||||||||||||||||
Secretary and Chief
|
2017 |
380,000 | 469,580 | 153,277 | 397,922 | 6,179 | 176,946 | 1,583,904 | |||||||||||||||||||||
Legal Officer
|
(a) |
Amounts represent the grant date fair value of stock options and stock awards determined in accordance with the FASB's stock based compensation rules. See Note 4 to the Consolidated Financial Statements included as Exhibit 13 to the Company's 2018 Annual Report on Form 10-K for a description of the assumptions used in determining the grant date fair value. |
|
|
(b) |
Amounts represent interest earnings on balances in each named executive officer's account under the Supplemental Pension Plans that are in excess of 120% of the long-term applicable federal rate in effect in July 2018.
|
(c) | See "All Other Compensation Table" for details. |
(d) |
Mr. Westfall was promoted to Chief Executive Officer of Vitas Healthcare Corporation and an Executive Vice President of the Company on June 16, 2016. |
(e) | Ms. Dallob became a named executive officer on May 15, 2017. |
|
K.J.
McNamara
|
D.P.
Williams
|
N.M.
Westfall
|
S.S.
Lee
|
N.C.
Dallob
|
|||||||||||||||
Company contribution to non-qualified
|
||||||||||||||||||||
deferred compensation plans
|
$
|
996,464
|
$
|
413,179
|
$ | 203,495 | $ | 345,691 | $ | 177,284 | ||||||||||
Personal use of Company aircraft (1)
|
108,505
|
50,595 | 26,063 |
-
|
2,759 | |||||||||||||||
Company contributions to unfunded
|
||||||||||||||||||||
supplemental retirement plan
|
26,356
|
12,185 |
-
|
11,965 | 7,215 | |||||||||||||||
Company paid club memberships
|
15,760
|
37,836 |
10,356
|
70,923 | 7,080 | |||||||||||||||
All other (2)
|
61,851
|
54,514 | 42,210 | 59,443 | 43,889 | |||||||||||||||
|
||||||||||||||||||||
Total
|
$ | 1,208,936 | $ | 568,309 | $ | 282,124 | $ | 488,022 | $ | 238,227 |
(1) |
The cost of the personal use of Company aircraft is calculated based on the incremental cost to the Company. Occasionally, our executives are accompanied by guests on the Company aircraft for personal reasons when there is available space on a flight being made for business reasons. There is no incremental cost associated with that guest's usage of the aircraft on these business trips. |
(2) |
Amounts included in this line represent payments made to the NEO's or on their behalf for: contributions to 401(k)
plan; the long-term care plan; term life insurance; supplemental life insurance; parking; cell phone service; personal use of the
Company apartment; annual credit card fees; home utilities (mainly home internet service); annual executive physical; family member travel to Company events; personal incidentals while on business travel; tickets to
sporting and artistic events; expenses paid on certain personal trips and certain housing and automobile expenses. All items accumulated in this line are individually
less than $25,000 or 10% of the total other compensation of the NEO, whichever is lower.
|
Name |
Grant
Date
|
All Other
Stock Awards:
Number of
Shares of
Stock or
Units
(#)
|
All Other
Option Awards:
Number of
Securities
Underlying
Options
(#) (a)
|
Exercise
or Base Price
of Option
Awards
($/Share) (b)
|
Closing
Market Price
on Grant
Date
($/Share)
|
Grant
Date Fair
Value of
Award
($) (c)
|
|||||||||||||||
K.J. McNamara | 2/16/2018 | 1,964 | - | n.a. | $ | 254.56 | $ | 670,117 | |||||||||||||
2/16/2018 |
1,964 | - | n.a. | 254.56 | 1,006,707 | ||||||||||||||||
11/2/2018 |
- | 30,000 | $ | 306.70 | 306.93 | 2,014,815 | |||||||||||||||
D.P. Williams | 2/16/2018 | 786 | - | n.a. | 254.56 | 268,183 | |||||||||||||||
2/16/2018 |
786 | - | n.a. | 254.56 | 402,888 | ||||||||||||||||
11/2/2018 |
- | 15,500 | $ | 306.70 | 306.93 | 1,040,988 | |||||||||||||||
N.M. Westfall | 2/16/2018 | 589 | - | n.a. | 254.56 | 200,967 | |||||||||||||||
2/16/2018 |
589 | - | n.a. | 254.56 | 301,910 | ||||||||||||||||
11/2/2018 |
- | 13,500 | $ | 306.70 | 306.93 | 906,667 | |||||||||||||||
S.S. Lee | 2/16/2018 | 422 | - | n.a. | 254.56 | 143,987 | |||||||||||||||
2/16/2018 |
422 | - | n.a. | 254.56 | 216,309 | ||||||||||||||||
11/2/2018 |
- | 8,000 | $ | 306.70 | 306.93 | 537,284 | |||||||||||||||
N.C. Dallob | 2/16/2018 | 324 | - | n.a. | 254.56 | 110,549 | |||||||||||||||
2/16/2018 |
324 | - | n.a. | 254.56 | 166,076 | ||||||||||||||||
11/2/2018 |
- | 7,200 | $ | 306.70 | 306.93 | 483,556 |
(a) |
Options have an expiration date of November 2, 2023. |
(b) | The exercise price of option awards is the average of the high and low sale prices of the New York Stock Exchange on the date of grant. |
(c) |
Amounts represent
the aggregate grant date fair value of the awards determined in accordance with the FASB's stock based compensation rules. See Note 4 to the Consolidated Financial Statements included as Exhibit 13 to the Company's Annual
Report on Form 10-K for a description of the assumptions used in determining the grant date fair value.
|
Name
|
Option Awards
|
Stock Awards
|
||||||
Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
|
Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable
|
Option
Exercise
Price
($)
|
Option
Expiration
Date
|
Number of
Shares or Units
of Stock
That Have
Not
Vested
(#)
|
Market Value
Of Shares
or Units of
Stock
That Have Not
Vested (g)
($)
|
|||
K.J. McNamara
|
30,899
|
-
|
70.30
|
11/8/2023
|
-
|
-
|
||
30,000
|
-
|
157.36
|
11/6/2020
|
-
|
-
|
|||
58,033
|
30,267
|
(a)
|
135.85
|
11/4/2021
|
-
|
-
|
||
18,333
|
36,667
|
(b)
|
231.91
|
11/3/2022
|
-
|
-
|
||
-
|
30,000
|
(c)
|
306.70 |
11/2/2023 |
-
|
-
|
||
-
|
-
|
-
|
n.a.
|
5,530
|
(d)
|
1,566,538
|
||
-
|
-
|
-
|
n.a.
|
4,314
|
(e)
|
1,222,070
|
||
-
|
-
|
-
|
n.a.
|
3,928
|
(f)
|
1,112,724
|
||
D.P. Williams
|
24,000
|
-
|
106.59
|
11/7/2024
|
-
|
-
|
||
8,000
|
-
|
157.36
|
11/6/2020
|
-
|
-
|
|||
20,766
|
10,384
|
(a) |
135.85
|
11/4/2021
|
-
|
-
|
||
6,666
|
13,334
|
(b)
|
231.91
|
11/3/2022
|
-
|
-
|
||
-
|
15,500
|
(c)
|
306.70
|
11/2/2023
|
-
|
-
|
||
-
|
-
|
-
|
n.a.
|
1,976
|
(d)
|
559,761
|
||
-
|
-
|
-
|
n.a.
|
1,726
|
(e)
|
488,941
|
||
-
|
-
|
-
|
n.a.
|
1,572
|
(f)
|
445,316
|
||
N.M. Westfall |
12,000 |
12,000 | (a) |
135.85 |
11/4/2021 | - | - |
|
6,533 |
13,067 | (b) | 231.91 |
11/3/2022 | - |
- |
||
- |
13,500 | (c) | 306.70 |
11/2/2023 | - | - |
||
- |
- |
- |
n.a | 790 | (d) |
223,791 |
||
- |
- | - |
n.a.
|
1,352 |
(e)
|
382,995 |
||
- |
- | - |
n.a.
|
1,178 |
(f)
|
333,704 |
||
|
Name
|
Option Awards
|
Stock Awards
|
||||||
Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
|
Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable
|
Option
Exercise
Price
($)
|
Option
Expiration
Date
|
Number of
Shares or Units
of Stock
That Have
Not
Vested
(#)
|
Market Value
Of Shares
or Units of
Stock
That Have Not
Vested (g)
($)
|
|||
S.S. Lee
|
13,000
|
-
|
106.59
|
11/7/2024
|
-
|
-
|
||
12,500
|
-
|
157.36
|
11/6/2020
|
-
|
-
|
|||
9,066
|
4,534
|
(a)
|
135.85
|
11/4/2021
|
-
|
-
|
||
3,000
|
6,000
|
(b) |
231.91
|
11/3/2022
|
-
|
-
|
||
-
|
8,000
|
(c) |
306.70
|
11/2/2023
|
-
|
-
|
||
- |
- | - |
n.a. | 1,186 | (d) |
335,970 |
||
- |
- | - |
n.a. | 948 |
(e) | 268,549 |
||
-
|
-
|
-
|
n.a.
|
844
|
(f)
|
239,088
|
||
N.C. Dallob |
- |
4,834 | (a) |
135.85 |
11/4/2021 | - |
- |
|
- |
5,734 | (b) | 231.91 |
11/3/2022 | - | - |
||
- |
7,200 | (c) | 306.70 |
11/2/2023 | - | - |
||
- |
- | - |
n.a. | 790 | (d) |
223,791 |
||
- |
- | - |
n.a. | 718 | (e) | 203,395 |
||
- |
- | - |
n.a. | 648 | (f) | 183,565 |
(a)
|
All of the unvested stock option award will vest on November 4, 2019.
|
(b)
|
Half of the remaining stock option award will vest on November 3, 2019 and the remainder on November 3, 2020.
|
(c)
|
One third of the stock option award will vest on November 2, 2019, one third on November 2, 2020 and the remainder on
November 2, 2021.
|
(d)
|
Award vests upon attainment of certain return or earnings targets on or prior to December 31, 2018.
|
(e)
|
Award vests upon attainment of certain return or earnings targets on or prior to December 31, 2019.
|
(f)
|
Award vests upon attainment of certain return or earnings targets on or prior to December 31, 2020.
|
(g)
|
Amounts are based on the $283.28 closing price of the Capital Stock on December 31, 2018. |
Option Awards | Stock Awards | |||||||||
Name
|
Number of
Shares
Acquired on
Exercise
(#)
|
Value
Realized on
Exercise
($)
|
Number of
Shares
Acquired on
Vesting
(#)
|
Value
Realized on
Vesting
($)
|
||||||
K.J. McNamara
|
132,500
|
$
|
24,577,150
|
13,752
|
$
|
3,709,876
|
||||
D.P. Williams
|
63,756
|
14,070,144
|
5,054
|
1,372,530
|
||||||
N.M. Westfall |
30,919 |
5,617,219 |
1,799 |
499,686 |
||||||
S.S. Lee
|
-
|
-
|
3,100
|
846,018
|
||||||
N.C. Dallob
|
11,732
|
1,685,889
|
2,021
|
548,858
|
Name
|
Executive
Contributions
in Last FY
($)
|
Registrant
Contributions
in Last FY
($)(a)(b)
|
Aggregate
Earnings
in Last FY
($)
|
Aggregate
Balance
at Last FYE
($)(b)
|
|||||||||
K.J. McNamara |
|
|
|
|
|
|
|
|
|||||
Excess Benefit Plan
|
$ |
- | $ |
989,039 |
$ |
378,169 | $ |
22,079,548 | |||||
Supplemental Pension and Life Insurance Plan
|
-
|
26,356
|
44,116
|
663,327
|
|||||||||
D.P. Williams
|
|||||||||||||
Excess Benefit Plan
|
316,290
|
405,754
|
(433,752
|
)
|
6,595,952
|
||||||||
Supplemental Pension and Life Insurance Plan
|
-
|
12,185
|
20,396
|
306,673
|
|||||||||
N.M. Westfall |
|||||||||||||
Excess Benefit Plan
|
- |
196,070 |
(36,439 | ) | 752,333 |
||||||||
Supplemental Pension and Life Insurance Plan
|
- |
- |
- |
||||||||||
S.S. Lee
|
|||||||||||||
Roto-Rooter Deferred Compensation Plan
|
100,099
|
345,691
|
(426,199
|
)
|
5,755,187
|
||||||||
Supplemental Pension and Life Insurance Plan
|
-
|
11,965
|
20,027
|
301,137
|
|||||||||
N.C. Dallob
|
|||||||||||||
Excess Benefit Plan
|
-
|
169,859
|
205,161
|
3,828,498
|
|||||||||
Supplemental Pension and Life Insurance Plan
|
-
|
7,215
|
12,075
|
181,577
|
(a)
|
Amounts reported in All Other Compensation Table for 2018.
|
(b)
|
To the extent that earnings reflected herein exceeded 120% of the long-term applicable federal rate in effect in
July 2018, such earnings are reported for 2018 in the All Other Compensation Table.
|
Name of Fund
|
Rate of Return
|
Name of Fund
|
Rate of Return
|
American Europacific Growth Fund
|
-14.95%
|
Merrill Lynch Moderate Model Portfolio
|
-6.12%
|
Chemed Corporation Common Stock
|
17.01%
|
Merrill Lynch Moderate/Aggressive Model Portfolio
|
-7.84%
|
Columbia Midcap Index Fund
|
-11.33%
|
Merrill Lynch Moderate/Conservative Model Portfolio
|
-3.91%
|
Dodge and Cox Income
|
-0.31%
|
MFS International Divs Fund R6
|
-10.92%
|
Hartford Mid Cap Fund
|
-7.32%
|
Oppenheimer Global Fund |
-13.36%
|
Invesco Growth and Income Fund
|
-13.24%
|
Pimco Low Duration Fund
|
0.51%
|
Invesco Real Estate Fund
|
-5.28%
|
Pimco Real Return Bond Fund
|
-1.98%
|
Ishares S&P 500 Index
|
-4.38%
|
Templeton Global Bond Fund
|
1.44%
|
Lord Abbett Developing Growth Fund
|
5.37%
|
Supplemental Pension and Life
|
7.00%
|
Mainstay Large Cap Growth Fund
|
3.74%
|
Vanguard Small Cap Fund
|
-12.23%
|
Merrill Lynch Aggressive Model Portfolio | -9.92% | Vanguard Federal Money Market | 1.78% |
Merrill Lynch Conservative Model Portfolio | -1.35% | Victory Sycamore Fund | -9.96% |
K.J.
McNamara
|
D.P.
Williams
|
N.M.
Westfall
|
S.S.
Lee
|
N.C.
Dallob
|
||||||||||||||||
Termination Without Cause
|
||||||||||||||||||||
Severance payment (a)
|
$
|
5,860,000
|
$
|
1,625,000
|
$
|
739,350
|
$
|
660,900
|
$
|
612,000
|
||||||||||
Pro-rated annual incentive
|
||||||||||||||||||||
compensation (b)
|
1,965,797 |
887,858
|
556,228
|
690,178
|
375,364
|
|||||||||||||||
Welfare benefit continuation (c)
|
27,998 |
34,061
|
21,748
|
20,005
|
20,110
|
|||||||||||||||
Total
|
$
|
7,853,795
|
$
|
2,546,919
|
$
|
1,317,326
|
$
|
1,371,083
|
$
|
1,007,474
|
||||||||||
Involuntary Termination for Cause or
|
||||||||||||||||||||
Voluntary Termination
|
||||||||||||||||||||
Severance payment
|
- |
- |
- |
- |
- |
|||||||||||||||
Welfare benefit continuation
|
- |
- |
- |
- |
- |
|||||||||||||||
Total
|
- |
- |
- |
- |
- |
|||||||||||||||
Termination due to Death or Disability
|
||||||||||||||||||||
Pro-rated annual incentive
|
||||||||||||||||||||
compensation (b)
|
$
|
1,965,797
|
$
|
887,858
|
$
|
556,228
|
$
|
690,178
|
$
|
375,364
|
||||||||||
Welfare benefit continuation
|
- |
- |
- |
- |
- |
|||||||||||||||
Total
|
$
|
1,965,797
|
$
|
887,858
|
$
|
556,228
|
$
|
690,178
|
$
|
375,364
|
||||||||||
Termination due to Retirement
|
||||||||||||||||||||
Pro-rated annual incentive
|
||||||||||||||||||||
compensation (b)
|
$ |
1,965,797 |
$ |
887,858 |
$ |
556,228 |
$ |
690,178 |
$ |
375,364 |
||||||||||
Welfare benefit continuation
|
- |
- |
- |
- |
- |
|||||||||||||||
Total
|
$
|
1,965,797
|
$
|
887,858
|
$
|
556,228
|
$
|
690,178
|
$
|
375,364
|
||||||||||
Change in Control with No Termination
|
||||||||||||||||||||
Annual incentive compensation
|
||||||||||||||||||||
payment (b)
|
$ |
1,965,797
|
$ |
887,858
|
$ |
556,228
|
$ |
690,178
|
$ |
375,364
|
||||||||||
Accelerated vesting of stock option and
|
||||||||||||||||||||
restricted stock awards
|
- |
- |
- |
- |
- |
|||||||||||||||
Distribution of Performance awards (i)
|
1,723,759
|
689,787
|
525,201
|
373,363
|
285,263
|
|||||||||||||||
280G Gross-up payment (e)
|
- |
- |
- |
- |
- |
|||||||||||||||
Total
|
$
|
3,689,556
|
$
|
1,577,645
|
$
|
1,081,429
|
$
|
1,063,541
|
$
|
660,627
|
||||||||||
Qualifying Termination following or in
|
||||||||||||||||||||
connection with a Change in Control
|
||||||||||||||||||||
Severance payment (f)
|
$
|
9,413,391
|
$
|
4,613,574
|
$
|
2,098,256
|
$
|
2,261,556
|
$
|
1,566,728
|
||||||||||
Annual incentive compensation
|
||||||||||||||||||||
payment (b)
|
1,965,797
|
887,858
|
556,228
|
690,178
|
375,364
|
|||||||||||||||
Welfare benefit continuation and
|
||||||||||||||||||||
perquisite continuation and
|
||||||||||||||||||||
outplacement assistance (g)
|
599,794
|
452,509
|
164,858
|
283,004
|
115,346
|
|||||||||||||||
Company contribution to deferred
|
||||||||||||||||||||
compensation plans (h)
|
3,130,335
|
1,337,967
|
448,240
|
771,412
|
410,248
|
|||||||||||||||
Accelerated vesting of stock option
|
||||||||||||||||||||
awards (d)
|
6,345,848
|
2,215,881
|
2,440,412
|
976,668
|
1,007,233
|
|||||||||||||||
Distribution of performance awards (i)
|
1,723,759
|
689,787
|
525,201
|
373,363
|
285,263
|
|||||||||||||||
280G Gross-up payment (e)
|
-
|
-
|
1,788,706
|
-
|
-
|
|||||||||||||||
Total
|
$
|
23,178,924
|
$
|
10,197,576
|
$
|
8,021,901
|
$
|
5,356,181
|
$
|
3,760,182
|
(a)
|
The amounts shown are based on the following base salaries as of December 31, 2018: for Mr. McNamara, $1,172,000; for
Mr. Williams, $650,000; for Mr. Westfall, $492,900; for Mr. Lee, $440,600; and for Ms. Dallob, $408,000. The severance payment is a lump-sum payment equal to: for Mr. McNamara, five times his base salary; for Mr.
Williams, two and a half times his base salary; and for each of Messrs. Lee, Westfall and Ms. Dallob, one and a half times base salary.
|
(b)
|
The pro-rated annual incentive compensation is based on the average of the prior three years annual incentive
compensation (2016, 2017 and 2018).
|
(c)
|
The amounts shown consist of, for the period specified in the employment agreements of Messrs. McNamara and Williams,
or, for Messrs. Lee, Westfall and Ms. Dallob, in the Senior Executive Severance Policy, the continued provision of welfare benefits under the Company’s welfare benefit plans. With respect to these benefits, the amounts
shown have been calculated based upon the current premiums paid by the Company for such benefits.
|
(d)
|
The value of each stock option award subject to acceleration was determined by multiplying the number of stock option
awards by the excess, if any, of $283.28 (the closing price of one share of Capital Stock on December 31, 2018) over the exercise price of such stock option awards.
|
(e)
|
The amount of the excise taxes imposed pursuant to Section 4999 of the Code was determined by multiplying by 20% the
“excess parachute payment” that would arise in connection with payments made to the applicable named executive officer upon the triggering event. The excess parachute payment was determined in accordance with the
provisions of Section 280G of the Code. The amount of the gross-up payment to make each named executive officer whole on an after-tax basis for
the excise taxes imposed under Section 4999 of the Code was determined assuming a federal tax rate of 37% and 5.0% state tax rate for each named executive officer .
|
(f)
|
The severance payment is equal to: for each of Messrs. McNamara and Williams, three times the sum of his current base
salary and average annual incentive compensation for the 2016, 2017 and 2018 fiscal years as shown in footnote (a); for each of Messrs. Lee, Westfall and Ms. Dallob, two times the sum of current base salary and average
annual incentive compensation for the 2016, 2017 and 2018 fiscal years as shown in footnote (a).
|
(g)
|
The amounts shown assume that Messrs. McNamara and Williams elect to receive their severance benefits under the Change
in Control Plan, which will result in each receiving greater benefits than he would be entitled to receive under his employment agreement. Accordingly, the amounts shown consist of, for the period specified in the Change
in Control Plan, (i) the continued provision of the perquisites (if any) listed in the All Other Compensation Table at 2018 levels, (ii) the continued provision of benefits under the Company’s welfare benefit plans, and
(iii) outplacement assistance. With respect to the continued provision of benefits under the Company’s welfare benefit plans, the amounts shown have been calculated based upon the current premiums paid by the Company for
such benefits.
|
(h)
|
The amounts shown equal the amount of Company contributions that would have been made on the executive’s behalf in the
Company’s qualified and non-qualified defined contribution plans had the executive continued participation in such plans, at the level in effect on December 31, 2018, for a three-year period following a Qualifying
Termination for Messrs. McNamara and Williams, and a two-year period following a Qualifying Termination for Messrs. Lee, Westfall and Ms. Dallob.
|
(i)
|
The amounts shown are the December 31, 2018 market value of the performance share units granted on February 20, 2017
and February 16, 2018 at target levels.
|
a.
|
Salary or hourly pay, as applicable
|
b.
|
Overtime or premium pay, if applicable
|
c.
|
Bonuses and commissions, if applicable
|
d.
|
Company contributions to 401K plans, and
|
e.
|
Company cost of term life insurance
|
Name and Address
Of Beneficial Owner
|
Amount and Nature of
Beneficial Ownership
|
Percent of Class (a)
|
The Vanguard Group
100 Vanguard Boulevard
Malvern, PA 19355
BlackRock, Inc.
55 E. 52nd Street
New York, NY 10055
|
1,840,481 shares (b)
1,666,222 shares (d)
|
11.49% (c)
10.4% (e)
|
(a) |
For purposes of calculating Percent of Class, all shares of Capital Stock subject to stock option awards which
were exercisable within 60 days of December 31, 2018, were assumed to have been issued.
|
(b) |
Sole voting power, 8,796 shares; shared voting power, 2,163 shares; sole dispositive power, 1,831,217 shares; |
(c) |
Information is based on a Schedule 13G filed with the SEC on February 11, 2019. |
(d) |
Sole voting power, 1,577,243 shares; sole dispositive power, 1,666,222 shares. |
(e) |
Information is based on a Schedule 13G filed with the SEC on January 24, 2019.
|
Owner
|
Amount and Nature of Beneficial Ownership
|
||||
Direct and
Thrift Plan (a)
|
Options
Exercisable (b)
|
Trusteeships
and Family
Holdings (c)
|
Total
|
Percent of
Class (d)
|
|
Kevin J. McNamara
|
122,550
|
107,265
|
-
|
229,815
|
1.39%
|
Naomi C. Dallob |
3,645 |
- |
- |
3,645 |
- |
Joel F. Gemunder
|
21,699
|
-
|
-
|
21,699
|
-
|
Patrick P. Grace
|
4,520
|
-
|
-
|
4,520
|
-
|
Thomas C. Hutton
|
40,326
|
10,100
|
49,216
|
99,642
|
-
|
Walter L. Krebs
|
11,971
|
-
|
-
|
11,971
|
-
|
Spencer S. Lee
|
30,504
|
25,066
|
-
|
55,570
|
-
|
Andrea R. Lindell
|
7,240
|
-
|
-
|
7,240
|
-
|
Thomas P. Rice
|
7,223
|
-
|
-
|
7,223
|
-
|
Donald E. Saunders
|
8,251
|
-
|
-
|
8,251
|
-
|
George J Walsh III
|
8,716
|
-
|
-
|
8,716
|
-
|
Nicholas M. Westfall | 4,052 |
18,533 |
- |
22,585 |
- |
Frank E. Wood
|
10,623
|
-
|
-
|
10,623
|
-
|
David P. Williams
|
24,918
|
59,432
|
-
|
84,350
|
-
|
Chemed Foundation
|
-
|
-
|
80,996
|
80,996
|
-
|
Total as a group
|
306,238
|
220,396
|
130,212
|
656,846
|
3.96%
|
(a) |
Such securities include shares of Capital Stock allocated as of December 31, 2018, to the account of each named person or member of the group under the Retirement Plan or, with respect to Mr. Gemunder, allocated to his account as of December 31, 2016, under the Omnicare Employees’ Savings and Investment Plan (the “Omnicare Savings Plan”). No such shares are pledged. |
(b) |
“Option” refers to shares of Capital Stock which the named person or group has a right to acquire within 60 days from December 31, 2018. Except as otherwise disclosed in this Proxy Statement, each director, director nominee and executive officer has sole voting and investment power over the shares of Capital Stock shown as beneficially owned. |
(c) |
Mr. Hutton is a trustee of several trusts and private foundations which hold in the aggregate, 49,216 shares over which the trustee has
shared voting and investment power. Messrs. McNamara and Hutton and Ms. Laney are trustees of the Chemed Foundation, which holds 80,996 shares of Capital Stock over which the trustees share both voting and investment
power. This number is included in the total number of “Trustee” shares held by the Directors and Executive Officers as a Group but is not reflected in the respective holdings of the individual trustees.
|
(d) |
Percent of Class includes Direct, Option and Trustee shares where indicated. For purposes of determining the Percent of Class, all shares
of Capital Stock subject to stock option awards which were exercisable within 60 days from December 31, 2018, were assumed to have been issued. Percent of Class under 1.0% is not shown. Shares of Capital Stock over
which more than one individual holds beneficial ownership have been counted only once in calculating the aggregate number of shares of Capital Stock owned by Directors and Executive Officers as a Group.
|
●
|
The integrity of the Company’s financial statements.
|
●
|
Compliance by the Company with legal and regulatory requirements.
|
●
|
The independence and performance of the Company’s internal and external auditors.
|
1. |
The Audit Committee has reviewed and discussed the audited financial statements and management’s report on internal control over
financial reporting with the Company’s management.
|
2. |
The Audit Committee has discussed with the independent accountants the matters required to be discussed by Auditing Standard 1301, as
adopted by the Public Company Accounting Oversight Board.
|
3. |
The Audit Committee has received the written disclosures and the letter from the independent accountants required by the applicable
requirements of the Public Company Accounting Oversight Board regarding the independent accountants’ communications with the Audit Committee concerning independence and has discussed with the independent
accountants the independent accountants’ independence.
|
4. |
Based on the review and discussion referred to in paragraphs (1) through (3) above, the Audit Committee recommended to the Board of
Directors that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018, for filing with the SEC.
|
1. |
Policies and procedures for making, with corporate funds or assets, contributions and expenditures (direct or indirect) to (a)
participate or intervene in any campaign on behalf of (or in opposition to) any candidate for public office, or (b) influence the general public, or any segment thereof, with respect to an election or referendum.
|
2. |
Monetary and non-monetary contributions and expenditures (direct and indirect) used in the manner described in section 1 above,
including:
|
|
Naomi C. Dallob
Secretary
|