þ | No fee required. |
o | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
(1) | Title of each class of securities to which transaction applies: |
(2) | Aggregate number of securities to which transaction applies: |
(3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): |
(4) | Proposed maximum aggregate value of transaction: |
(5) | Total fee paid: |
o | Fee paid previously with preliminary materials. |
o | 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: |
| elect three directors, each for a term of three years; |
| vote to ratify the appointment of Ernst & Young LLP as Libbeys independent auditors for our fiscal year ending December 31, 2007; and | |
| transact such other business as properly may come before the meeting. |
| Proposal 1: Election of three nominees Carlos V. Duno, Peter C. McC. Howell and Richard I. Reynolds to serve as Class II directors; and | |
| Proposal 2: Ratification of the appointment of Ernst & Young LLP as Libbeys independent auditors for the 2007 fiscal year. |
| Proposal 1: FOR each of Carlos V. Duno, Peter C. McC. Howell and Richard I. Reynolds to serve as Class II directors; and | |
| Proposal 2: FOR ratification of the appointment of Ernst & Young LLP as Libbeys independent auditors for the 2007 fiscal year. |
1
| sending us a proxy card dated later than your last vote; | |
| notifying the Secretary of Libbey in writing; or | |
| voting at the meeting. |
2
Amount and
Nature |
||||||||
Name and
Address |
of Beneficial |
Percent |
||||||
of Beneficial
Owner
|
Ownership | of Class | ||||||
Zesiger Capital Group LLC(1)
|
1,987,000 | 13.9% | ||||||
320 Park Avenue,
30th Floor New York, NY 10022 |
||||||||
FMR Corp.(2)
|
1,404,800 | 9.823% | ||||||
82 Devonshire Street Boston, MA 02109 |
||||||||
Dimensional Fund Advisors
LP(3)
|
1,012,997 | 7.08% | ||||||
1299 Ocean Avenue Santa Monica, CA 90401 |
(1) | Amendment No. 3 to Schedule 13G filed with the Securities and Exchange Commission on behalf of Zesiger Capital Group LLC, an investment advisor, indicates that, as of December 31, 2006, Zesiger Capital Group LLC is the beneficial owner of 1,987,000 common shares, with sole dispositive power as to 1,987,000 common shares and sole voting power as to 1,318,000 common shares. The schedule further states that all securities reported in the schedule are held in discretionary accounts that Zesiger Capital Group LLC manages, and that no single client of Zesiger Capital Group LLC owns more than 5% of the class. | |
(2) | Amendment No. 4 to Schedule 13G filed with the Securities and Exchange Commission by FMR Corp., a parent holding company, on behalf of FMR Corp., Edward C. Johnson 3d, Fidelity Management & Research Company (Fidelity) and Fidelity Low Priced Stock Fund, indicates that, as of December 31, 2006, Fidelity, an investment advisor, is the beneficial owner of 1,404,800 common shares as a result of acting as investment adviser to various companies. The ownership of one investment company, Fidelity Low Priced Stock Fund, amounts to 1,404,800 shares. The schedule further indicates that each of Edward C. Johnson 3d, FMR Corp., through its control of Fidelity, and the Funds, has sole power to dispose of 1,404,800 common shares, and that neither FMR Corp. nor Edward C. Johnson 3d, Chairman of FMR Corp., has the sole power to vote or direct the voting of the shares owned directly by the Funds, such power residing in the Funds Boards of Trustees. |
(3) | Schedule 13G filed with the Securities and Exchange Commission on behalf of Dimensional Fund Advisors LP, an investment advisor, states that Dimensional Fund Advisors LP furnishes investment advice and serves as investment manager to certain commingled group trusts and separate accounts (the Funds). The schedule further indicates that Dimensional Fund Advisors LP is the beneficial owner of 1,012,997 common shares, with sole voting and dispositive power with respect to all of those shares; that the Funds own all such securities; and that no one such Fund owns more than 5% of the shares. |
3
Amount and
Nature |
||||||||
of Beneficial |
Percent |
|||||||
Name of
Beneficial Owner
|
Ownership(1) | of Class | ||||||
Carlos V. Duno
|
4,653 | * | ||||||
William A. Foley(2)
|
3,745 | * | ||||||
Daniel P. Ibele(3)
|
82,613 | * | ||||||
Peter C. McC. Howell(2)(4)
|
5,402 | * | ||||||
John F. Meier(3)(5)
|
275,790 | 1.9 | ||||||
Deborah G. Miller(2)
|
5,645 | * | ||||||
Carol B. Moerdyk(2)
|
4,545 | * | ||||||
Gary L. Moreau(2)
|
834 | * | ||||||
Richard I. Reynolds(3)
|
199,855 | 1.4 | ||||||
Scott M. Sellick(3)
|
45,556 | * | ||||||
Terence P. Stewart(2)
|
5,580 | * | ||||||
Kenneth G. Wilkes(3)
|
119,069 | * | ||||||
Directors & Executive
Officers as a Group(3)(2)
|
906,193 | 6.3 |
(1) | Includes the following number of stock options that have been granted to Messrs. Meier, Sellick, Reynolds, Wilkes and Ibele and that currently are exercisable or will be exercisable on or before May 8, 2007: |
Number of |
||||
Outstanding
Stock |
||||
Options
Exercisable |
||||
Named
Executive
|
Within 60 Days | |||
John F. Meier
|
202,000 | |||
Scott M. Sellick
|
37,000 | |||
Richard I. Reynolds
|
152,400 | |||
Kenneth G. Wilkes
|
96,300 | |||
Daniel P. Ibele
|
72,900 |
4
(2) | Does not include the following number of shares of phantom stock held by non-management directors, as of March 9, 2007, pursuant to certain deferred compensation plans for outside directors: |
Number of |
||||
Name of
Director
|
Phantom Shares | |||
William A. Foley
|
11,565 | |||
Peter C. McC. Howell
|
5,679 | |||
Deborah G. Miller
|
2,152 | |||
Carol B. Moerdyk
|
19,309 | |||
Gary L. Moreau
|
1,239 | |||
Terence P. Stewart
|
15,057 |
(3) | Includes the shares of common stock that Messrs. Meier, Sellick, Reynolds, Wilkes and Ibele, and all officers as a group, held in the Libbey Inc. Retirement Savings Plan as of March 9, 2007. |
(4) | Includes 750 shares held by family members of Mr. Howell. Mr. Howell disclaims any beneficial interest in these shares. | |
(5) | Includes 8,406 shares held by family members of Mr. Meier. Mr. Meier disclaims any beneficial interest in these shares. |
No. of RSUs |
No. of RSUs |
|||||||
with
3-Year |
with
4-Year |
|||||||
Named
Executive
|
Vesting(1) | Vesting(2) | ||||||
J. Meier
|
27,993 | 30,853 | ||||||
S. Sellick
|
6,020 | 7,007 | ||||||
R. Reynolds
|
15,199 | 16,346 | ||||||
K. Wilkes
|
7,751 | 8,432 | ||||||
D. Ibele
|
5,471 | 5,831 |
(1) | RSUs with three-year vesting vest ratably (1/3 per year) on each of the first through third anniversaries of the grant date, provided the Named Executive remains in continuous employment with Libbey as of the date of vesting. One share of our common stock will be issued for each vested RSU. Dividends do not accrue on RSUs until they vest. |
(2) | RSUs with four-year vesting vest ratably (1/4 per year) on each of the first through fourth anniversaries of the grant date, provided the Named Executive remains in continuous employment with Libbey as of the date of vesting. One share of our common stock will be issued for each vested RSU. Dividends do not accrue on RSUs until they vest. |
5
Board
Committee |
Director |
|||||||||||
Director
|
Age
|
Experience
|
Assignments
|
Since
|
||||||||
Carlos V. Duno (Class II)
|
59 | Owner and Chief Executive Officer of Marcia Owen Associates, a recruiting and staffing agency, from July 2006 to present; Chief Executive Officer and Owner, CDuno Consulting, from November 2004 to present; Chairman & CEO, Clean Fuels Technology, from June 2001 to October 2004; President, Business Development and Planning, Vitro S.A. from July 1995 to May 2001. | Member, Audit Committee; Member, Nominating and Governance Committee | 2003 | ||||||||
William A. Foley (Class III)
|
59 | President and a Director of Arhaus, Incorporated, a retailer of home furnishings, from November 2006 to present; Chairman and Chief Executive Officer of Intelligence Inc. and Think Well Inc. from March 2005 to present; Co-founder of Entrenu Holdings LLC; Chairman and Chief Executive Officer of LESCO Inc. from July 1993 to April 2002. | Chair, Compensation Committee; Member, Nominating and Governance Committee | 1994 | ||||||||
Peter C. McC. Howell (Class II)
|
57 | From 1997 to present, advisor to various business enterprises in the areas of acquisitions, marketing and financial reporting; Chairman and Chief Executive Officer of Signature Brands USA Inc. (formerly Health o meter, Inc.) from August 1994 to August 1997; President, Chief Executive Officer and a director of Mr. Coffee, inc. from 1989 to 1994; Member of the board of directors of Pure Cycle Corporation (NASDAQ: PCYO). | Member, Audit Committee; Chair, Nominating and Governance Committee | 1993 | ||||||||
John F. Meier (Class I)
|
59 | Chairman of the Board and Chief Executive Officer of Libbey since June 1993; Director, Cooper Tire and Rubber Company (NYSE: CTB), since 1997. Director, Applied Industrial Technologies (NYSE: AIT), since October 2005. | 1987 |
6
Board
Committee |
Director |
|||||||||||
Director
|
Age
|
Experience
|
Assignments
|
Since
|
||||||||
Deborah G. Miller (Class III)
|
57 | Chief Executive Officer of Enterprise Catalyst Group, a consulting firm specializing in high technology and biotechnology transformational applications, from 2003 to present, and in that role, President, Chief Executive Officer and Chairman of Ascendant Systems from February 2005 to present and Chief Executive Officer of Maranti Networks from September 2003 to November 2004; President and Chief Executive Officer of Egenera from April 2002 to 2003; from November 2001 to March 2002, Chief Executive Officer, On Demand Software. Ms. Miller also serves on the board of directors of Sentinel Group Funds, Inc. | Member, Compensation Committee; Member, Nominating and Governance Committee | 2003 | ||||||||
Carol B. Moerdyk (Class I)
|
56 | Senior Vice President, International, OfficeMax, Incorporated (formerly Boise Cascade Corporation), from August 2004 to present; Senior Vice President, Administration, Boise Cascade Office Products Corporation, from January 2004 to August 2004; Senior Vice President, North American and Australasian Contract Operations, Boise Cascade Office Products Corporation from 1998 through 2003. Director of American Woodmark Corporation (NASDAQ: AMWD) since May 2005. | Chair, Audit Committee; Member, Compensation Committee | 1998 | ||||||||
Gary L. Moreau (Class I)
|
52 | Writer, lecturer and advisor, primarily in the areas of corporate and organizational governance and culture, from 2003 to present; President of Pratts Hollow Advisors LLC (business consulting) from 1999 to 2003; President and Chief Executive Officer of Lionel L.L.C. from January 1996 to July 1999; President and Chief Operating Officer of Oneida Ltd. from 1991 to January 1996. | Member, Audit Committee; Member, Compensation Committee | 1996 | ||||||||
Richard I. Reynolds (Class II)
|
60 | Executive Vice President and Chief Operating Officer of Libbey from November 1995 to present; Vice President and Chief Financial Officer of Libbey from 1993 to 1995. | 1993 |
7
Board
Committee |
Director |
|||||||||||
Director
|
Age
|
Experience
|
Assignments
|
Since
|
||||||||
Terence P. Stewart (Class III)
|
58 | Managing partner of Stewart and Stewart, a Washington, D.C.-based law firm that specializes in trade and international law issues, where he has been employed since 1976. | 1997 |
| The Compensation Committee reviews executive compensation at comparable companies and recommends to the Board compensation levels and incentive compensation plans for our executives; | |
| The Compensation Committee reviews and approves the corporate goals and objectives relevant to the targets of the executive incentive compensation plans; | |
| Following the Boards annual evaluation of the performance of the Chief Executive Officer (which is to be reviewed with the Chief Executive Officer by the chair of the Committee), the Compensation Committee establishes the compensation of the Chief Executive Officer based on the evaluation, and in determining the long-term incentive compensation component of the Chief Executive Officers compensation, the Compensation Committee consider the Companys performance, relative |
8
shareholder return, the value of similar awards to chief executive officers at comparable companies and the awards given to the Companys Chief Executive Officer in prior years. |
| The Compensation Committee performs an annual evaluation of the performance and effectiveness of the Compensation Committee. |
| Board members must possess the highest professional and personal ethics and values, consistent with longstanding company values and standards; | |
| Board members must possess broad experience at the policy-making level in business, government, education, technology or public interest; | |
| Board members must possess a commitment to enhancing shareholder value; |
9
| Board members must possess and devote sufficient time to carry out their duties and to provide insight and practical wisdom based upon experience; and | |
| Board members must possess expertise in areas that add strategic value to the Board and/or knowledge of business in foreign locations strategic to our then-current or potential future operations. For example, successful candidates for the Board will have current or recent experience as a chief executive officer of a public company; expertise in logistics and advanced supply chain management; experience as an executive with a large multinational or as an expatriate executive in the Far East, Europe or Latin America; management experience in the foodservice market in the fast food, restaurant or food distribution industry; or management or board experience in a highly leveraged environment. |
10
11
Nature of
Fees
|
2006 Fees | 2005 Fees | ||||||
Audit Fees(1)
|
$ | 1,932,920 | $ | 1,167,610 | ||||
Audit Related Fees(2)
|
$ | 76,000 | $ | 59,000 | ||||
Tax Fees(3)
|
$ | 0 | $ | 3,970 | ||||
All Other Fees
|
$ | 0 | 0 | |||||
Total
|
$ | 2,008,920 | $ | 1,230,580 | ||||
(1) | Fees for audit services include fees associated with the annual audit of our internal controls, the annual audit of financial statements and the reviews of our quarterly reports on Form 10-Q and annual report on Form 10-K. In addition, fees for 2006 audit services include fees associated with comfort letters and consents in connection with our refinancing in June 2006. |
(2) | Audit-related fees principally include fees for audits of our benefit plans. |
(3) | Tax services relate to expatriate compliance services. |
12
| confirming the independence of our independent auditors; | |
| the appointment, compensation and retention of our independent auditors; | |
| reviewing the scope of the audit services to be provided by our independent auditors, including the adequacy of staffing and compensation; | |
| approving non-audit services; | |
| overseeing managements relationship with our independent auditors; | |
| overseeing managements implementation and maintenance of effective systems of internal and disclosure controls; and | |
| reviewing our internal audit program. |
13
| the January 2005 acquisition of Crisal-Cristalaria Automática, S.A., a manufacturer of glass tableware in low-cost Portugal; | |
| the February 2005 closure of our glassware facility in City of Industry, California, and the related shifting of production from that facility to our facilities in Toledo, Ohio and Shreveport, Louisiana, in order to maximize capacity utilization; |
| the construction of our new glassware manufacturing facility in China; |
| the adoption of LEAN manufacturing principles across our enterprise; and | |
| the acquisition, completed in June 2006, of the remaining 51% equity interest that we did not previously own in Vitrocrisa, S. de R.L. de C.V. and related entities (which we call Crisa), our Mexican joint venture, and the subsequent restructuring of Crisas business. |
| Talent Attraction and Retention Objective. Our executive compensation program should be designed to attract and retain the highly qualified executives whose talents, energy and hard work are critical to accomplishment of our business strategies, including the strategy described above. | |
| Motivational Objective. Our executive compensation program should provide sufficient financial incentives to motivate our executives to achieve our business objectives. | |
| Alignment Objective. Our executive compensation program should align the interests of our executives with the long-term interests of our stockholders by awarding equity- and other performance-based compensation. |
14
| Reasonableness Objective. Our executive compensation program should balance the need to provide sufficient financial incentives to achieve the motivational objective described above with the need to ensure that executive compensation is reasonable. |
| Base salary; | |
| Performance-based compensation; | |
| Stock options and restricted stock units (which we refer to as RSUs); | |
| Other compensation; and | |
| With respect to our executive officers, employment agreements, and with respect to our executive officers and other key members of senior management, change in control agreements. |
| An annual cash incentive award under our Senior Management Incentive Plan approved on March 31, 2006 (which we refer to as the SMIP); and | |
| Performance share awards (which we refer to as performance shares) under our Long-Term Incentive Plan (which we refer to as our LTIP). |
15
Target LTIP Award
as a |
||||
Percentage of
Base Salary |
||||
Named
Executive
|
(%) | |||
J. Meier
|
150 | |||
S. Sellick
|
80 | |||
R. Reynolds
|
115 | |||
K. Wilkes
|
80 | |||
D. Ibele
|
60 |
| Matching contributions to our qualified defined contribution plan (namely, our 401(k) savings plan) on the same basis as we provide for all salaried employees. | |
| Matching contributions to our Executive Savings Plan (which we refer to as our ESP). | |
| Limited perquisites, consisting only of: |
| tax return preparation and financial planning, together with related tax gross-ups; | |
| an annual executive physical examination; and | |
| executive car service for personal and business trips for the executive (and the executives spouse in the case of trips on which the spouse is accompanying the executive) between the Toledo, Ohio area and the Detroit/ Wayne County Metropolitan airport. |
16
Ameron International Corporation
|
Haggar Corp. | Polaris Industries Inc. | ||
Ametek, Inc.
|
Jacuzzi Brands, Inc. | Sypris Solutions, Inc. | ||
Applica Inc.
|
Jarden Corp. | Teradyne, Inc. | ||
Blyth Inc.
|
Johnson Outdoors Inc. | Thermadyne Holdings | ||
Brady Corporation
|
Lancaster Colony Corp. | Tupperware Corporation | ||
Church & Dwight Company,
Inc.
|
Milacron Inc. | Waters Corporation | ||
EnPro Industries Inc.
|
Oneida Ltd. | Woodward Governor Company | ||
ESCO Technologies Inc.
|
Playtex Products, Inc. | Yankee Candle Co. | ||
Graco Inc.
|
| Average target bonus opportunities and actual bonuses for our executives were significantly below market. | |
| The average values of long-term incentive opportunities and actual long-term incentive payouts for our executives were more than 80% below market. | |
| Our executive compensation program lacked meaningful performance-based and other equity-based compensation opportunities. |
17
| in connection with the initial hiring of an executive; and | |
| in early December of each year (through 2005) in conjunction with the regular meeting of the Board. |
| The Compensation Committee has limited the total number of non-qualified stock options or restricted shares, as the case may be, that may be granted; | |
| The exercise price of any stock options that the Chairman awards cannot be less than the closing price of our common stock on the date of grant; | |
| Grants may not be made during quiet periods; and | |
| The Chairman must report periodically to the Compensation Committee with respect to the awards that he has made pursuant to this delegation of authority. |
18
| as a result of misconduct, we are required to prepare an accounting restatement due to our material noncompliance with any financial reporting requirement under the securities laws; and | |
| any of our executives knowingly engaged, or was grossly negligent in engaging, in the misconduct, or knowingly failed, or was grossly negligent in failing, to prevent the misconduct or is one of the individuals subject to automatic forfeiture under Section 304 of the Sarbanes-Oxley Act of 2002, |
Target SMIP Award
as a |
||||
Percentage of
Base Salary |
||||
Named
Executive
|
(%) | |||
J. Meier
|
90 | |||
S. Sellick
|
60 | |||
R. Reynolds
|
75 | |||
K. Wilkes
|
55 | |||
D. Ibele
|
50 |
19
| Achievement of a specified level of quantifiable savings from implementation of LEAN initiatives; | |
| Achievement, on time and within budget, of specified benchmarks with respect to the consolidation of Crisas two manufacturing facilities into a single facility; | |
| Achievement of start-up of our new glassware manufacturing facility in China by a date certain and within the budgeted capital for the project; | |
| Achievement of budgeted North American net sales; | |
| Achievement of budgeted International IFO; | |
| Development and implementation of specified compliance and risk management initiatives; and | |
| Achievement of a new debt structure within specified parameters. |
20
| January 1, 2006 through December 31, 2006; |
| January 1, 2006 through December 31, 2007; and |
| January 1, 2006 through December 31, 2008. |
| Allocated 25% of the performance shares awarded pursuant to the January 2006 LTIP to the period January 1 through June 30, 2006, with the balance being allocated to the period July 1, 2006 through December 31, 2008; |
| Terminated the January 2006 LTIP and cancelled the performance shares awarded on March 31, 2006, except to the extent necessary to enable the vesting of the performance shares (and issuance of the corresponding common shares) allocated to the period January 1 through June 30, 2006; |
| Determined that we had, for the period January 1 through June 30, 2006, achieved 163% of budgeted EBITDA (based upon the budget submitted to the Board in February 2006), resulting in a payout of 200% of the performance shares allocated to that period, including the issuance to the Named Executives of the following number of common shares in February 2007: |
No. of Shares |
||||
Named
Executive
|
Awarded | |||
J. Meier
|
9,458 | |||
S. Sellick
|
2.034 | |||
R. Reynolds
|
5,135 | |||
K. Wilkes
|
2,619 | |||
D. Ibele
|
1,848 |
21
| Adopted a new LTIP (which we refer to as the July 2006 LTIP) that contemplates three performance cycles beginning on July 1, 2006 and ending on December 31 of each of 2006, 2007 and 2008, respectively; |
| Awarded performance shares under the July 2006 LTIP, electing to accelerate the phase-in of the performance share component by awarding performance shares having a grant date fair value equal to 20% of the respective participants target LTIP awards; and |
| Determined that vesting of the performance shares awarded under the July 2006 LTIP would be subject to achievement of a specified percentage of budgeted EBITDA, excluding special charges and as may be adjusted to take into account subsequent acquisitions or dispositions that may be significant, and that the relevant budget for measuring achievement of this performance goal would be the revised budget submitted to the Board on July 25, 2006. |
Named Executive
Officer
|
No. of Shares | |||
J. Meier
|
1,357 | |||
S. Sellick
|
292 | |||
R. Reynolds
|
737 | |||
K. Wilkes
|
376 | |||
D. Ibele
|
265 |
| A grant of non-qualified stock options and RSUs vesting ratably over three years and having an exercise price equal to the closing price of our common stock on February 16, 2007, the first business day after we released our financial results for our 2006 fiscal year; and | |
| A grant of non-qualified stock options and RSUs vesting ratably over four years and having an exercise price equal to the closing price of our common stock on February 16, 2007, the first business day after we released our financial results for our 2006 fiscal year. |
22
Annual Retainer:
|
$25,000 | |
Equity Awards:
|
On December 1,
2006, Restricted Stock Units (RSUs) vesting on January 2,
2007
|
|
On the date of each
annual meeting of stockholders beginning with the annual meeting
to be held on May 3, 2007, outright grant of shares of
common stock, in each case having a grant date fair equal to
$40,000(1)
|
||
Audit Committee Chair
Retainer:
|
$7,500 per year | |
Compensation Committee Chair
and Nominating and Governance
Committee Chair
Retainers:
|
$5,000 per year | |
Regular Board Meeting
Fees:
|
$1,500 per meeting | |
Regular Committee Meeting
Fees:
|
$750 per meeting | |
Telephonic Board or Committee
Meeting Fees:
|
$500 per meeting | |
Other Fees:
|
$500 per half day for performance of special Board or committee business requested of the director |
(1) | The number of RSUs or shares of common stock, as the case may be, is determined by dividing $40,000 by the average closing price of our common stock for a period of 60 consecutive trading days ending on the date of grant. |
23
| Death of the executive officer; |
| Permanent disability of the executive officer; or |
| We terminate the executive officers employment without cause or the executive officer terminates his or her employment for good reason. |
| the executive officers willful and continued failure (other than as a result of an incapacity due to physical or mental illness or after the executive officer issues a notice of termination for good reason) to substantially perform his or her duties after our Board delivers to the executive officer a written demand for substantial performance that specifically identifies the manner in which the Board believes that the executive officer has not substantially performed his or her duties; |
| the executive officers willful and continued failure (other than as a result of an incapacity due to physical or mental illness or after the executive officer issues a notice of termination for good reason) to substantially follow and comply with the specific and lawful directives of our Board, as reasonably determined by our Board, after our Board delivers to the executive officer a written demand for substantial performance that specifically identifies the manner in which our Board believes that the executive officer has not substantially followed or complied with the directives of the Board; |
| the executive officers willful commission of an act of fraud or dishonesty resulting in material economic or financial injury to Libbey; or |
| the executive officers willful engagement in illegal conduct or gross misconduct, in each case which is materially and demonstrably injurious to Libbey. |
| With respect to Mr. Meier only: |
| He ceases to be our Chief Executive Officer reporting to the Board, or he fails to be elected as a member of the Board. | |
| There is a change in the reporting or responsibilities of any other executive officer that has not been approved by Mr. Meier. |
| With respect to each of our Named Executives other than Mr. Meier, the Named Executive ceases to be an executive officer reporting to another executive officer. |
24
| With respect to each of our Named Executives, including Mr. Meier: |
| His base salary is reduced by a greater percentage than the reduction applicable to any other executive officer. | |
| There is a reduction in the incentive compensation target established for the position held by the Named Executive that is not applied in the same or similar manner to all other executive officers. | |
| An executive benefit provided to the Named Executive is reduced or eliminated and the reduction or elimination is not applicable to all other executive officers in the same or similar manner; unless the reduction or elimination is with respect to the number of equity awards granted to the respective executive officers. | |
| We materially breach the employment agreement and do not remedy our breach within 30 days after we receive written notice of breach from the Named Executive. |
| We exercise our right not to extend the term of the Named Executives employment agreement beyond the then current term, unless we exercise that right with respect to all employment agreements (excluding change in control agreements) in effect with respect to our other executive officers. In that connection, the initial term of each employment agreement began on March 22, 2004 and expired on December 31, 2006. However, each employment agreement was automatically extended for an additional one-year period. Each employment agreement will continue to be extended automatically for additional one-year periods unless either we notify the Named Executive, or the Named Executive notifies us, on or before September 30 of the year in question, that the agreement will not be further extended. |
| Benefits payable upon death Within sixty (60) days after we receive written notice of appointment of a personal representative on behalf of the Named Executives estate, together with reasonable evidence of the personal representatives authority to act: |
| Base salary through the date of death; |
| Annual and long-term incentive compensation paid at target but prorated over the period of each applicable plan through the date of death; |
| In the case of Mr. Meier, two times his annual base salary, and in the case of all other Named Executives, one times his annual base salary, in each case at the rate in effect on the date of death and payable in a lump sum; |
| Continuation of medical, prescription drug, dental and vision benefits for covered dependents for a period of 12 months following the date of death without any contribution by the dependents; |
| Vesting, as of the date of death, of previously unvested equity participation awards, which will be exercisable for a period of three years following the date of death or for such longer period following the date of death as is specified by the award; and |
| If and to the extent that the Named Executive is determined to be subject to excise tax under Section 4999 of the Internal Revenue Code (which applies to amounts paid in connection with a change in control), an amount (which we refer to as the tax gross-up) such that the amount retained by the Named Executive after the calculation and deduction of all applicable federal, state and local income, employment and excise taxes (including any interest or penalties imposed with respect to such taxes and taking into account any lost or reduced tax deductions on account of the |
25
tax gross-up payment) is equal to the sum of the payments to which the Named Executive is entitled under the first five bullet points immediately above. |
| Upon permanent disability, termination by us without cause or termination by the Named Executive with good reason We must pay or provide the following benefits (subject to withholding) in accordance with our normal pay practices (which contemplate semi-monthly payments): |
| Any long-term disability coverage in effect; |
| Base salary accrued through the date of termination; |
| Annual incentive compensation paid at the lesser of the annual target or the average percentage of the target paid to all other executive officers, but prorated over the period of each applicable plan through the date of termination; |
| Long-term incentive compensation under all plans in effect at the date of termination, paid at target, but prorated over the period of each applicable plan through the date of termination; |
| Two times (or, in the case of Mr. Meier, three times) the sum of annual base salary at the then current rate, payable in equal installments over a period of 24 months (or, in Mr. Meiers case, 36 months) following the date of termination, although we may elect to pay this amount in a lump sum; |
| Annual incentive compensation at the lesser of annual target or the average percentage of the target paid to all other executive officers, for all annual compensation periods ending 24 months (or, in Mr. Meiers case, 36 months) after the date termination, with the final payment prorated to the end of the 24 month (or, in Mr. Meiers case, 36 month) period; |
| Continuation of medical, prescription drug, dental and life insurance benefits for a period of 24 months (or, in Mr. Meiers case, 36 months) following the date of termination, without any contribution by the Named Executive or his dependents; |
| Vesting, as of the date of termination, of previously unvested equity participation awards, which will be exercisable for a period of three years following the date of termination or for such longer period following the date of termination as is specified by the award granted to the Named Executive; and |
| If and to the extent the Named Executive is determined to be subject to excise tax pursuant to Section 4999 of the Internal Revenue Code, the tax gross-up, as applied to the benefits provided in the eight bullet points immediately above. |
| Termination upon permanent disability, by us without cause or by the Named Executive for good reason Our obligation to pay the benefits described above is subject to the following conditions or other obligations of the respective Named Executives: |
| The Named Executives execution and delivery of a release of all claims against us; and |
| The Named Executives obligations with respect to: confidentiality of our proprietary information; assignment to us of any inventions and copyrights obtained in connection with his employment; assisting us with any litigation with respect to which the Named Executive has, or may have reason to have, knowledge, information or expertise; not interfering with customer accounts for 24 months (or, in Mr. Meiers case, for 36 months); not competing for 24 months (or, in Mr. Meiers case, 36 months); not diverting business opportunities of which the Named Executive became aware while an employee for 24 months or, in Mr. Meiers case, 36 months; not soliciting our employees for 24 months or, in Mr. Meiers case, 36 months; and not disparaging us for 24 months or, in Mr. Meiers case, 36 months. |
| Termination for any other reason as to which benefits are payable under the agreement Our obligation to pay benefits is not subject to receipt of a release of claims signed by the Named |
26
Executive, but the Named Executive or his personal representative must covenant with respect to: confidentiality of our proprietary information; assignment to us of any inventions and copyrights obtained in connection with his employment; assisting us with any litigation with respect to which the Named Executive has, or may have reason to have, knowledge, information or expertise; not interfering with customer accounts for 24 months (or, in Mr. Meiers case, for 36 months); not competing for 24 months (or, in Mr. Meiers case, 36 months); not diverting business opportunities of which the Named Executive became aware while an employee for 24 months or, in Mr. Meiers case, 36 months; not soliciting our employees for 24 months or, in Mr. Meiers case, 36 months; and not disparaging us for 24 months or, in Mr. Meiers case, 36 months. |
| We terminate the executives employment, without cause, within two years following a change in control; |
| The executive terminates his employment for good reason (as defined below) within two years following a change in control; or |
| The executive voluntarily terminates his employment within 30 days after the first anniversary of the change in control. |
| We assign to the executive duties that are inconsistent with the executives position immediately prior to the change in control, or we significantly and adversely alter the nature or status of the executives responsibilities or the conditions of the executives employment from those in effect immediately prior to the change in control (including if we cease to be a publicly-held corporation), or we take any other action that results in a material diminution in the executives position, authority, duties or responsibilities; |
| We reduce the executives annual base salary as in effect on the date of the Named Executives change in control agreement and as increased from time to time thereafter; |
| We relocate the offices at which the executive principally is employed immediately prior to the date of the change in control (which we refer to as the executives Principal Location) to a location more than 30 miles from that location, or we require the executive, without his or her written consent, to be based anywhere other than his or her Principal Location, except for required travel on business to an extent substantially consistent with the executives present business travel obligations; |
| We fail to pay to the executive any portion of his or her current compensation or to pay to him or her any portion of an installment of deferred compensation under any deferred compensation program within seven days of the date on which the compensation is due; |
27
| We fail to continue in effect any material compensation or benefit plan or practice in which the executive participates immediately prior to the change in control, unless an equitable arrangement (embodied in an ongoing substitute or alternative plan) has been made with respect to the plan, or we fail to continue the executives participation in the plan (or in the substitute or alternative plan) on a basis that is not materially less favorable, both in terms of the amount of benefits provided and the level of the executives participation relative to other participants, as existed at the time of the change in control; |
| We fail to continue to provide the executive with benefits substantially similar in the aggregate to those enjoyed by the executive under any of our life insurance, medical, health and accident, disability, pension, retirement or other benefit plans or practices in which the executive and his or her eligible family members were participating at the time of the change in control, or we take any action that would directly or indirectly materially reduce any of those benefits, or we fail to provide the executive with the number of paid vacation days to which the executive is entitled on the basis of years of service with us in accordance with our normal vacation policy in effect at the time of the change in control; |
| We fail to obtain a satisfactory agreement from any successor to assume and agree to perform our obligations under the executives change in control agreement; |
| We purport to terminate the executives employment without complying with our obligations with respect to providing notice of termination; or |
| The executive continues, after giving us written notice of his or her objection, to be subjected to harassing or denigrating treatment in the workplace that is inconsistent with his or her position with us. |
| Amount payable and timing of payments With respect to the Named Executives, we are obligated to pay or provide the following benefits, at the times indicated, if a Named Executives employment is terminated in accordance with any of the triggers discussed above: |
| Base salary when due through the date of termination at the rate in effect at the time the notice of termination is given, plus all other amounts to which the Named Executive is entitled under any compensation plan or practice that we have in place at the time the payments are due; |
| Within five days after the date of termination, a lump sum severance equal to the sum of: |
| Three times the Named Executives annual base salary in effect as of the date of termination or immediately prior to the change in control, whichever is greater; and |
| Three times the greater of (a) the Named Executives target annual bonus as in effect as of the date of termination or immediately prior to the change in control, whichever is greater, or (b) the Named Executives annual bonus for the year immediately preceding the date of termination; |
| Immediate vesting of restricted stock grants, with the shares of stock to be distributed to the Named Executive within five days after the date of termination; |
| Immediate vesting of unvested stock options; |
| For one year following the date of termination, financial planning services of substantially the same type and scope as we were providing to the Named Executive immediately prior to the date of termination or, if more favorable to the Named Executive, immediately prior to the change in control; |
| For two years following the date of termination, outplacement services; |
| For 36 months after the date of termination, medical and dental health benefits at least equal to those to which the Named Executive would have been entitled had he or she not been terminated, with costs to be shared on the same basis as in effect on the date of the change in control, but if the Named |
28
Executive is re-employed during that period and is eligible to receive medical and dental benefits from the new employer, our obligations are reduced to the extent comparable benefits are actually received by the Named Executive during the 36-month period following the date of termination; |
| Full and immediate vesting of accrued benefits under any qualified or nonqualified pension, profit sharing, deferred compensation or supplemental plans that we maintain for the Named Executives benefit, plus additional fully vested benefits in an amount equal to the benefits that would have accrued had the Named Executive continued his or her employment for three additional years following the date of termination, provided that (a) if the then-present value of all those benefits is less than $250,000, we are obligated to pay a lump sum equal to the difference between $250,000 and the then-present value of the benefits, and (b) with respect to Mr. Meier and Mr. Reynolds, the full vesting of benefits applies to the pension plan benefits without reduction for age; |
| Tax gross-up; and |
| Directors and officers liability coverage for the Named Executive for six years after the date of termination, with policy limits not less than those in effective immediately prior to the change in control. |
29
Change in |
||||||||||||||||||||||||||||||||||||
Pension Value |
||||||||||||||||||||||||||||||||||||
and |
||||||||||||||||||||||||||||||||||||
Nonqualified |
||||||||||||||||||||||||||||||||||||
Non-Equity |
Deferred |
|||||||||||||||||||||||||||||||||||
Stock |
Option |
Incentive |
Compensation |
All Other |
||||||||||||||||||||||||||||||||
Salary |
Bonus |
Awards |
Awards |
Compensation |
Earnings |
Compensation |
Total |
|||||||||||||||||||||||||||||
Name and
Principal Position
|
Year | ($) | ($) | ($)(1) | ($) | ($)(2) | ($)(3) | ($)(4) | ($) | |||||||||||||||||||||||||||
John F. Meier
|
2006 | 558,000 | 0 | 82,500 | 0 | 631,767 | 0 | 18,656 | 1,290,923 | |||||||||||||||||||||||||||
Chairman and Chief Executive Officer
|
||||||||||||||||||||||||||||||||||||
Scott M. Sellick
|
2006 | 252,675 | 0 | 17,744 | 0 | 189,506 | 12,579 | 6,965 | 479,469 | |||||||||||||||||||||||||||
Vice President, Chief Financial
Officer
|
||||||||||||||||||||||||||||||||||||
Richard I. Reynolds
|
2006 | 395,184 | 0 | 44,794 | 0 | 366,928 | 0 | 12,530 | 819,436 | |||||||||||||||||||||||||||
Executive Vice President, Chief
Operating Officer
|
||||||||||||||||||||||||||||||||||||
Kenneth G. Wilkes
|
2006 | 300,315 | 0 | 22,848 | 0 | 213,734 | 22,022 | 12,863 | 571,782 | |||||||||||||||||||||||||||
Vice President, General Manager,
International Operations
|
||||||||||||||||||||||||||||||||||||
Daniel P. Ibele
|
2006 | 240,097 | 0 | 16,118 | 0 | 158,224 | 16,124 | 10,403 | 440,966 | |||||||||||||||||||||||||||
Vice President, General Sales
Manager, North America
|
(1) | Represents the 2006 compensation cost that we recorded, for financial reporting purposes in accordance with FAS 123R, with respect to common stock issued in settlement of performance shares earned for 2006. |
(2) | Represents annual cash incentive compensation that we paid to the Named Executives in February 2007 for performance during 2006. |
(3) | Represents the sum (but not less than $0) of (a) the change in pension value under our Libbey Inc. Salaried Cash Balance Pension Plan (which we refer to as our Salary Plan) and our Supplemental Executive Retirement Plan (which we refer to as our SERP) and (b) above-market earnings on nonqualified deferred compensation under our Executive Savings Plan (which we refer to as our ESP) during 2006 for each of the Named Executives, as set forth in the following table: |
Change in
Pension |
Nonqualified
Deferred |
|||||||
Value |
Compensation
Earnings |
|||||||
Named
Executive
|
($) | ($) | ||||||
J. Meier
|
(57,009 | ) | 0 | |||||
S. Sellick
|
12,579 | 0 | ||||||
R. Reynolds
|
(39,897 | ) | 0 | |||||
K. Wilkes
|
22,022 | 0 | ||||||
D. Ibele
|
16,124 | 0 |
30
(4) | Includes annual company contributions to our qualified and unqualified defined contribution plans (namely, our 401(k) savings plan and ESP); the cost that we paid for tax return preparation and financial planning for the Named Executives, together with tax gross-ups on that cost; and our incremental cost for executive car service for personal and business trips from the Toledo, Ohio area to the Detroit/ Wayne County Metropolitan airport. For personal trips, includes the entire cost that we incurred for such transportation; for business trips, includes only the amount in excess of the amount to which the Named Executive would have been entitled to reimbursement for mileage and parking under our travel policy applicable to all employees. No single perquisite had a value in excess of $10,000. The amount of the tax gross-up that we paid in connection with tax return preparation and/or financial planning for each of the Named Executives is as follows: |
Tax
Gross-up |
||||
Named
Executive
|
($) | |||
J. Meier
|
287 | |||
S. Sellick
|
0 | |||
R. Reynolds
|
275 | |||
K. Wilkes
|
1,240 | |||
D. Ibele
|
1,015 |
Grant Date |
||||||||||||||||||||||||||||||
Estimated Future
Payouts |
Fair Value |
|||||||||||||||||||||||||||||
Under Non-Equity
Incentive |
Estimated Future
Payouts Under Equity |
of Stock |
||||||||||||||||||||||||||||
Plan Awards(1) | Incentive Plan Awards |
and Option |
||||||||||||||||||||||||||||
Threshold |
Target |
Maximum |
Threshold |
Target |
Maximum |
Awards |
||||||||||||||||||||||||
Name
|
Grant Date | ($) | ($) | ($) | (#) | (#) | (#) | ($) | ||||||||||||||||||||||
J. Meier
|
251,100 | 502,200 | 1,004,400 | |||||||||||||||||||||||||||
March 31, 2006(2) | 2,365 | 4,729 | 9,458 | 66,963 | ||||||||||||||||||||||||||
September 27, 2006(3) | 7,982 | 15,963 | 31,926 | 15,538 | ||||||||||||||||||||||||||
S. Sellick
|
67,500 | 135,000 | 270,000 | |||||||||||||||||||||||||||
March 31, 2006(2) | 509 | 1,017 | 2,034 | 14,401 | ||||||||||||||||||||||||||
September 27, 2006(3) | 1,717 | 3,433 | 6,866 | 3,343 | ||||||||||||||||||||||||||
R. Reynolds
|
148,194 | 296,388 | 592,776 | 0 | 0 | 0 | ||||||||||||||||||||||||
March 31, 2006(2) | 1,284 | 2,568 | 5,135 | 36,356 | ||||||||||||||||||||||||||
September 27, 2006(3) | 4,334 | 8,667 | 17,334 | 8,439 | ||||||||||||||||||||||||||
K. Wilkes
|
79,671 | 159,341 | 318,6810 | 0 | 0 | 0 | ||||||||||||||||||||||||
March 31, 2006(2) | 655 | 1,310 | 2,619 | 18,543 | ||||||||||||||||||||||||||
September 27, 2006(3) | 2,211 | 4,421 | 8,842 | 4,305 | ||||||||||||||||||||||||||
D. Ibele
|
52,594 | 105,187 | 210,374 | 0 | 0 | 0 | ||||||||||||||||||||||||
March 31, 2006(2) | 462 | 924 | 1,848 | 13,084 | ||||||||||||||||||||||||||
September 27, 2006(3) | 1,560 | 3,120 | 6,240 | 3,034 |
31
(1) | Represents awards under the SMIP for 2006. Awards made under the SMIP are payable only in cash. For 2006, the scale for payouts with respect to the corporate component was as follows: |
Percentage of |
Payout as |
|||||||
Budgeted IFO |
Percentage of
Target |
|||||||
Payout
Level
|
(%) | (%) | ||||||
Threshold
|
95 | % | 50 | % | ||||
Target
|
100 | % | 100 | % | ||||
Maximum
|
115 | % | 200 | % |
(2) | Represents performance shares awarded under the January 2006 LTIP and subsequently allocated to the period January 1 through June 30, 2006. |
(3) | Represents performance shares awarded under the July 2006 LTIP for the three performance cycles beginning July 1, 2006. The following table shows the portions of those grants that are allocable to each of the performance cycles: |
No. of
Performance |
||||
Named Executive
Officer
|
Shares at Target | |||
J. Meier
|
||||
First Cycle
|
1,756 | |||
Second Cycle
|
5,268 | |||
Third Cycle
|
8,939 | |||
S. Sellick
|
||||
First Cycle
|
378 | |||
Second Cycle
|
1,133 | |||
Third Cycle
|
1,922 | |||
R. Reynolds
|
||||
First Cycle
|
953 | |||
Second Cycle
|
2,860 | |||
Third Cycle
|
4,854 | |||
K. Wilkes
|
||||
First Cycle
|
486 | |||
Second Cycle
|
1,459 | |||
Third Cycle
|
2,476 | |||
D. Ibele
|
||||
First Cycle
|
343 | |||
Second Cycle
|
1,030 | |||
Third Cycle
|
1,747 |
32
Option Awards | Stock Awards | |||||||||||||||||||||||
Equity
Incentive |
||||||||||||||||||||||||
Number of |
Number of |
Plan Awards: |
Equity Incentive
Plan |
|||||||||||||||||||||
Securities |
Securities |
Number of |
Awards: Market
or |
|||||||||||||||||||||
Underlying |
Underlying |
Unearned
Shares, |
Payout Value
of |
|||||||||||||||||||||
Unexercised |
Unexercised |
Option |
Units or Other |
Unearned
Shares, |
||||||||||||||||||||
Options |
Options |
Exercise |
Option |
Rights That
Have |
Units or Other
Rights |
|||||||||||||||||||
(#) |
(#) |
Price |
Expiration |
Not Vested |
That Have Not
Vested |
|||||||||||||||||||
Name
|
Exercisable | Unexercisable(1) | ($) | Date | (#)(2) | ($)(3) | ||||||||||||||||||
J. Meier
|
30,000 | 0 | 38.4375 | 06/06/08 | 14,207 | 174,888 | ||||||||||||||||||
30,000 | 0 | 31.3750 | 08/25/09 | |||||||||||||||||||||
30,000 | 0 | 32.3125 | 09/08/10 | |||||||||||||||||||||
35,000 | 0 | 30.5500 | 11/14/11 | |||||||||||||||||||||
35,000 | 0 | 23.9300 | 11/21/12 | |||||||||||||||||||||
17,500 | 0 | 28.5300 | 12/16/13 | |||||||||||||||||||||
17,500 | 0 | 20.3900 | 12/11/14 | |||||||||||||||||||||
7,000 | 10,500 | 11.7900 | 12/09/15 | |||||||||||||||||||||
S. Sellick
|
500 | 0 | 38.4375 | 06/06/08 | 3,055 | 36,966 | ||||||||||||||||||
750 | 0 | 31.3750 | 11/26/08 | |||||||||||||||||||||
1,250 | 0 | 31.3750 | 08/25/09 | |||||||||||||||||||||
1,500 | 0 | 32.3125 | 09/08/10 | |||||||||||||||||||||
3,000 | 0 | 31.1500 | 02/23/11 | |||||||||||||||||||||
3,000 | 0 | 30.5500 | 11/14/11 | |||||||||||||||||||||
7,000 | 0 | 23.9300 | 11/21/12 | |||||||||||||||||||||
7,000 | 0 | 28.5300 | 12/16/13 | |||||||||||||||||||||
8,000 | 0 | 20.3900 | 12/11/14 | |||||||||||||||||||||
4,000 | 6,000 | 11.7900 | 12/09/15 | |||||||||||||||||||||
R. Reynolds
|
22,000 | 0 | 38.4375 | 06/06/08 | 7,714 | 94,959 | ||||||||||||||||||
22,000 | 0 | 31.3750 | 08/25/09 | |||||||||||||||||||||
22,000 | 0 | 32.3125 | 09/08/10 | |||||||||||||||||||||
27,000 | 0 | 30.5500 | 11/14/11 | |||||||||||||||||||||
27,000 | 0 | 23.9300 | 11/21/12 | |||||||||||||||||||||
13,500 | 0 | 28.5300 | 12/16/13 | |||||||||||||||||||||
13,500 | 0 | 20.3900 | 12/11/14 | |||||||||||||||||||||
5,400 | 8,100 | 11.7900 | 12/09/15 |
33
Option Awards | Stock Awards | |||||||||||||||||||||||
Equity
Incentive |
||||||||||||||||||||||||
Number of |
Number of |
Plan Awards: |
Equity Incentive
Plan |
|||||||||||||||||||||
Securities |
Securities |
Number of |
Awards: Market
or |
|||||||||||||||||||||
Underlying |
Underlying |
Unearned
Shares, |
Payout Value
of |
|||||||||||||||||||||
Unexercised |
Unexercised |
Option |
Units or Other |
Unearned
Shares, |
||||||||||||||||||||
Options |
Options |
Exercise |
Option |
Rights That
Have |
Units or Other
Rights |
|||||||||||||||||||
(#) |
(#) |
Price |
Expiration |
Not Vested |
That Have Not
Vested |
|||||||||||||||||||
Name
|
Exercisable | Unexercisable(1) | ($) | Date | (#)(2) | ($)(3) | ||||||||||||||||||
K. Wilkes
|
11,500 | 0 | 38.4375 | 06/06/08 | 3,935 | 48,440 | ||||||||||||||||||
11,500 | 0 | 31.3750 | 08/25/09 | |||||||||||||||||||||
11,500 | 0 | 32.3125 | 09/08/10 | |||||||||||||||||||||
17,000 | 0 | 30.5500 | 11/14/11 | |||||||||||||||||||||
17,000 | 0 | 23.9300 | 11/21/12 | |||||||||||||||||||||
11,000 | 0 | 28.5300 | 12/16/13 | |||||||||||||||||||||
12,000 | 0 | 20.3900 | 12/11/14 | |||||||||||||||||||||
4,800 | 7,200 | 11.7900 | 12/09/15 | |||||||||||||||||||||
D. Ibele
|
5,500 | 0 | 38.4375 | 06/06/08 | 2,777 | 34,185 | ||||||||||||||||||
5,500 | 0 | 31.3750 | 08/25/09 | |||||||||||||||||||||
2,000 | 0 | 27.1250 | 12/17/09 | |||||||||||||||||||||
8,000 | 0 | 32.3125 | 09/08/10 | |||||||||||||||||||||
13,500 | 0 | 30.5500 | 11/14/11 | |||||||||||||||||||||
13,500 | 0 | 23.9300 | 11/21/12 | |||||||||||||||||||||
9,500 | 0 | 28.5300 | 12/16/13 | |||||||||||||||||||||
11,000 | 0 | 20.3900 | 12/11/14 | |||||||||||||||||||||
6,600 | 4,400 | 11.7900 | 12/09/15 |
(1) | Twenty percent of these options will vest on each of December 8, 2007, December 8, 2008 and December 8, 2009. |
(2) | Represents the total number of common shares underlying performance shares that were awarded under the July 2006 LTIP and that have not been earned as of December 31, 2006. Performance shares allocable to the period July 1, 2006 through December 31, 2007 may be earned if and to the extent that we achieve EBITDA equal to at least 85% of our budgeted EBITDA for that period. If we achieve that threshold level of performance, participants in the July 2006 LTIP will earn 50% of the target number of performance shares. |
(3) | Represents the aggregate market value of shares of common stock underlying unearned and unvested performance shares. We have estimated the market value by multiplying the number of shares of common stock underlying unearned and unvested performance shares by $12.31, the closing price of our common stock on the New York Stock Exchange on December 29, 2006. |
34
Option Awards | Stock Awards | |||||||||||||||
Number of |
Number of |
|||||||||||||||
Shares |
Value Realized |
Shares |
Value Realized |
|||||||||||||
Acquired on |
on |
Acquired on |
on |
|||||||||||||
Exercise |
Exercise |
Vesting |
Vesting |
|||||||||||||
Name
|
(#) | ($) | (#) | ($)(1) | ||||||||||||
J. Meier
|
0 | 0 | 10,815 | 136,913 | ||||||||||||
S. Sellick
|
0 | 0 | 2,326 | 29,446 | ||||||||||||
R. Reynolds
|
0 | 0 | 5,872 | 74,337 | ||||||||||||
K. Wilkes
|
0 | 0 | 2,995 | 37,915 | ||||||||||||
D. Ibele
|
0 | 0 | 2,113 | 26,750 |
(1) | Represents the sum of (a) the product of the number of performance shares earned under the January 2006 LTIP for the period January 1 through June 30, 2006, and $12.79, the closing price of our common stock on January 3, 2007, the first business day after December 31, 2006 (the date on which such shares vested) and (b) the product of the number of performance shares earned under the July 2006 LTIP for the First Cycle (July 1 through December 31, 2006), and $11.75, the closing price of our common stock on February 5, 2007, which is the date on which the Compensation Committee determined that such shares had been earned. |
35
Number of
Years |
Present Value
of |
Payments
During |
||||||||||||
Credited
Service |
Accumulated
Benefit |
Last Fiscal
Year |
||||||||||||
Name
|
Plan Name | (#)(1) | ($)(2) | ($) | ||||||||||
J. Meier
|
Salary Plan | 36.25 | 1,253,974 | 0 | ||||||||||
SERP | 36.25 | 3,751,721 | 0 | |||||||||||
S. Sellick
|
Salary Plan | 9.33 | 62,085 | 0 | ||||||||||
SERP | 9.33 | 3,704 | 0 | |||||||||||
R. Reynolds
|
Salary Plan | 36.83 | 1,238,895 | 0 | ||||||||||
SERP | 36.83 | 1,950,201 | 0 | |||||||||||
K. Wilkes
|
Salary Plan | 13.42 | 124,846 | 0 | ||||||||||
SERP | 13.42 | 76,415 | 0 | |||||||||||
D. Ibele
|
Salary Plan | 23.58 | 164,262 | 0 | ||||||||||
SERP | 23.58 | 35,078 | 0 |
(1) | Represents actual years of service to Libbey and Owens-Illinois Inc, our former parent company. We have not granted additional years of credited service to any of our executives. | |
(2) | Amounts were determined based on the assumptions outlined in our audited financial statements for the year ended December 31, 2006, except that assumptions relating to expected retirement age are as follows. Participants who are eligible for pension benefits under the Salary Plans final average pay formula (Messrs. Meier and Reynolds) are assumed to retire at the earliest age at which they can receive an unreduced benefit under the Salary Plan. All other participants are assumed to receive benefits under the cash balance design at their normal retirement age of 65. |
36
Executive |
Registrant |
Aggregate |
Aggregate |
|||||||||||||||||
Contributions
in |
Contributions
in |
Earnings in
Last |
Withdrawals/ |
Aggregate
Balance |
||||||||||||||||
Last FY |
Last FY |
FY |
Distributions |
at Last FYE |
||||||||||||||||
Name
|
($) | ($)(1) | ($)(2) | ($) | ($)(3) | |||||||||||||||
J. Meier
|
32,550 | 9,765 | 69,803 | 0 | 563,848 | |||||||||||||||
S. Sellick
|
0 | 0 | 0 | 0 | 0 | |||||||||||||||
R. Reynolds
|
9,977 | 4,988 | 42,582 | 0 | 324,879 | |||||||||||||||
K. Wilkes
|
8,273 | 2,364 | 11,327 | 0 | 93,059 | |||||||||||||||
D. Ibele
|
0 | 0 | 1,127 | 0 | 8,312 |
(1) | Included in column headed All Other Compensation in the Summary Compensation Table above. | |
(2) | Not included in column headed Change in Pension Value and Nonqualified Deferred Compensation Earnings in the Summary Compensation Table because earnings are not at an above-market rate. | |
(3) | Included in column headed All Other Compensation in the Summary Compensation Table above to the extent of the contributions that are reflected in the Registrant Contributions in Last FY column of this table. |
37
Long-Term |
Acceleration
of |
Pension |
||||||||||||||||||||||||||
Base |
Annual
Incentive |
Incentive |
Unvested
Equity |
Misc. |
Plan |
|||||||||||||||||||||||
Salary |
Compensation |
Compensation |
Awards |
Benefits |
Benefits |
Total |
||||||||||||||||||||||
Named
Executive
|
($)(1) | ($)(2) | ($)(3) | ($)(4) | ($)(5) | ($)(6) | ($)(7) | |||||||||||||||||||||
John F. Meier
|
||||||||||||||||||||||||||||
Death
|
1,116,000 | 502,200 | 133,133 | 180,348 | 62,000 | 4,117,225 | 6,110,906 | |||||||||||||||||||||
Permanent disability
|
1,674,000 | 502,200 | 133,133 | 180,348 | 38,901 | 4,117,225 | 6,645,807 | |||||||||||||||||||||
Voluntary termination for Good
Reason or involuntary termination without Cause
|
1,674,000 | 502,200 | 133,133 | 180,348 | 56,901 | 4,117,225 | 6,663,807 | |||||||||||||||||||||
Involuntary termination for Cause
|
0 | 0 | 0 | 0 | 0 | 4,117,225 | 4,117,225 | |||||||||||||||||||||
Scott M. Sellick
|
||||||||||||||||||||||||||||
Death
|
261,900 | 151,605 | 28,633 | 40,086 | 12,000 | 21,517 | 515,741 | |||||||||||||||||||||
Permanent disability
|
523,800 | 151,605 | 28,633 | 40,086 | 26,418 | 21,517 | 792,059 | |||||||||||||||||||||
Voluntary termination for Good
Reason or involuntary termination without Cause
|
523,800 | 151,605 | 28,633 | 40,086 | 44,418 | 21,517 | 810,059 | |||||||||||||||||||||
Involuntary termination for Cause
|
0 | 0 | 0 | 0 | 0 | 21,517 | 21,517 | |||||||||||||||||||||
Richard I. Reynolds
|
||||||||||||||||||||||||||||
Death
|
395,184 | 296,388 | 72,284 | 99,171 | 62,000 | 2,185,747 | 3,110,774 | |||||||||||||||||||||
Permanent disability
|
790,368 | 296,388 | 72,284 | 99,171 | 25,934 | 2,185,747 | 3,469,892 | |||||||||||||||||||||
Voluntary termination for Good
Reason or involuntary termination without Cause
|
790,368 | 296,388 | 72,284 | 99,171 | 43,934 | 2,185,747 | 3,487,892 | |||||||||||||||||||||
Involuntary termination for Cause
|
0 | 0 | 0 | 0 | 0 | 2,185,747 | 2,185,747 | |||||||||||||||||||||
Kenneth G. Wilkes
|
||||||||||||||||||||||||||||
Death
|
315,162 | 165,173 | 36,868 | 52,184 | 62,000 | 107,569 | 738,956 | |||||||||||||||||||||
Permanent disability
|
630,324 | 165,173 | 36,868 | 52,184 | 25,934 | 107,569 | 1,018,052 | |||||||||||||||||||||
Voluntary termination for Good
Reason or involuntary termination without Cause
|
630,324 | 165,173 | 36,868 | 52,194 | 43,934 | 107,569 | 1,036,062 | |||||||||||||||||||||
Involuntary termination for Cause
|
0 | 0 | 0 | 0 | 0 | 107,569 | 107,569 | |||||||||||||||||||||
Daniel P. Ibele
|
||||||||||||||||||||||||||||
Death
|
249,078 | 120,048 | 26,011 | 36,473 | 12,000 | 79,883 | 523,493 | |||||||||||||||||||||
Permanent disability
|
498,156 | 120,048 | 26,011 | 36,473 | 26,330 | 79,883 | 786,901 | |||||||||||||||||||||
Voluntary termination for Good
Reason or involuntary termination without Cause
|
498,156 | 120,048 | 26,011 | 36,473 | 44,330 | 79,883 | 804,901 | |||||||||||||||||||||
Involuntary termination for Cause
|
0 | 0 | 0 | 0 | 0 | 79,883 | 79,883 |
(1) | Represents (a) in the event of termination due to death, two times 2006 base salary in the case of Mr. Meier or one times 2006 base salary in the case of the other Named Executives (in each case at the rate in effect on the date of termination), and (b) in the event of termination due to permanent disability, voluntary termination for good reason or involuntary termination without cause, three times 2006 base salary in the case of Mr. Meier and two times 2006 base salary in the case of the other Named Executives (in each case at the rate in effect on the date of termination). Since termination is assumed to have occurred on December 31, 2006, we have assumed that all 2006 base salary has been paid when due. In the event of termination as a result of death, the base salary component is payable in a lump sum. In the event of termination as a result of partial disability, voluntary termination for good reason or involuntary termination without cause, the base salary component is payable as salary continuation in accordance with our pay practices, unless we elect to pay it in a lump sum. |
38
(2) | Represents (a) in the event of termination due to death, the product of 2006 actual base salary and the applicable Named Executives target percentage under our SMIP program (90% in the case of Mr. Meier, 75% in the case of Mr. Reynolds, 60% in the case of Mr. Sellick, 55% in the case of Mr. Wilkes and 50% in the case of Mr. Ibele), and (b) in the event of termination due to permanent disability, voluntary termination for good reason or involuntary termination without cause, the product of 2006 actual base salary and the lesser of (i) the applicable Named Executives target percentage under our SMIP program (see above) or (ii) the average percentage of target annual incentive compensation paid to all other executive officers. The average percentage of target annual incentive compensation paid to all executive officers for 2006 was 128%. |
(3) | Represents the estimated value of shares of common stock actually issued on February 19, 2007, as payment for awards earned under the January 2006 LTIP and July 2006 LTIP for the period January 1 through December 31, 2006. We have estimated the value by multiplying the number of shares by $12.31, the closing price of our common stock on the New York Stock Exchange on December 29, 2006. As of December 31, 2006, the only form of long-term incentive compensation that had been awarded consisted of performance shares. In order to avoid duplication, the unearned performance shares for the July 1, 2006 through December 31, 2007 and July 1, 2006 through December 31, 2008 performance cycles are treated in this table as unvested restricted stock, and the estimated value of the underlying shares is included under the column headed Acceleration of Unvested Equity Awards. |
(4) | Represents the sum of (a) the estimated value of common stock underlying performance shares for the July 1, 2006 through December 31, 2007 and July 1, 2006 through December 31, 2008 performance cycles and (b) the in-the-money/intrinsic value of unvested non-qualified stock options, in each case based upon the closing price of our common stock on the New York Stock Exchange on December 29, 2006 ($12.31 per share). |
(5) | Represents the sum of (a) the estimated cost of medical, prescription drug, dental and vision benefits for the Named Executives covered dependents for (i) 12 months following the date of termination if termination is a result of death or (ii) 24 months (or, in Mr. Meiers case, 36 months) following the date of termination if termination is a result of permanent disability, voluntary termination for good reason or involuntary termination without cause; (b) with respect only to Messrs. Meier, Reynolds and Wilkes, in the event of termination as a result of death, a $50,000 death benefit under an insurance policy purchased for their benefit in approximately 1997; (c) in the event of termination as a result of death, a death benefit under our group life insurance policy applicable to all salaried employees equal to $250,000 in the case of Messrs. Meier, Sellick, Reynolds and Wilkes and equal to $241,000 in the case of Mr. Ibele; and (d) in the event of termination as a result of permanent disability, voluntary termination for good reason or involuntary termination without cause, the estimated cost of continued life insurance coverage, for a period of 24 months (or, in Mr. Meiers case, 36 months) following the date of termination, under our group life insurance policy applicable to all salaried employees. |
(6) | Represents the sum of (a) the annuity payable to each of the Named Executives under our Salary Plan, (b) the lump sum payable to each of the Named Executives under our SERP and (c) the balances in the respective Named Executives ESP account. Although each of the Named Executives is entitled, under our Salary Plan, to elect either a lump sum benefit or an annuity, as of December 31, 2006 our ability to pay lump sum benefits under the Salary Plan was restricted as a result of limitations imposed by Section 401 of the Internal Revenue Code upon lump-sum distributions to highly compensated employees. Absent that restriction, the lump sum amounts that would have been payable to the Named Executives under the Salary Plan were $1,343,265 Mr. Meier, $66,550 Mr. Sellick, $1,325,651 Mr. Reynolds, $131,876 Mr. Wilkes and $175,227 Mr. Ibele. Does not include the respective Named Executives account balances under our 401(k) savings plan. |
(7) | Does not include any tax gross-up because the excise tax contemplated by Section 4999 of the Internal Revenue Code does not apply in the absence of a change in control. |
39
Acceleration |
||||||||||||||||||||||||||||||||
Acceleration |
of Unvested |
|||||||||||||||||||||||||||||||
of Unvested |
Restricted |
Pension |
||||||||||||||||||||||||||||||
Base |
Annual
Incentive |
Stock |
Stock |
Misc. |
Plan |
Tax |
||||||||||||||||||||||||||
Salary |
Compensation |
Options |
Awards |
Benefits |
Benefits |
Gross-Up |
Total |
|||||||||||||||||||||||||
Named
Executive
|
($)(1) | ($)(2) | ($)(3) | ($)(4) | ($)(5) | ($)(6) | ($) | ($) | ||||||||||||||||||||||||
John F. Meier
|
1,674,000 | 1,506,600 | 5,460 | 174,888 | 55,934 | 4,931,073 | 1,569,099 | 9,917,054 | ||||||||||||||||||||||||
Scott M. Sellick
|
785,700 | 454,815 | 3,120 | 37,607 | 56,418 | 271,517 | 784,416 | 2,393,593 | ||||||||||||||||||||||||
Richard I. Reynolds
|
1,185,552 | 889,164 | 4,212 | 94,959 | 55,934 | 2,760,626 | 1,006,768 | 5,997,215 | ||||||||||||||||||||||||
Kenneth G. Wilkes
|
945,486 | 495,520 | 3,744 | 48,440 | 55,934 | 450,628 | 749,308 | 2,749,060 | ||||||||||||||||||||||||
Daniel P. Ibele
|
747,234 | 360,146 | 2,288 | 34,185 | 56,330 | 338,195 | 659,073 | 2,197,451 |
(1) | Represents three times base salary in effect on December 31, 2006 and is payable in a lump sum. We have assumed that all 2006 base salary has been paid when due. | |
(2) | Represents three times the Named Executives target annual incentive compensation, since no annual incentive compensation was paid for 2005. Target annual incentive compensation is a percentage of base salary actually earned during the year (as reflected by W-2 wages). For information with respect to the target percentages of the respective Named Executives, see What compensation did Libbeys executives receive for 2006? Annual Incentive Compensation under SMIP. | |
(3) | Represents the in-the-money/intrinsic value of unvested non-qualified stock options based upon the closing price of our stock on the New York Stock Exchange on December 29, 2006 ($12.31 per share). | |
(4) | Represents the estimated value of common stock underlying performance shares for the July 1, 2006 through December 31, 2007 and July 1, 2006 through December 31, 2008 performance cycles. We have estimated the value by multiplying the number of performance shares for those performance cycles by $12.31, the closing price of our stock on the New York Stock Exchange on December 29, 2006. | |
(5) | Represents the sum of (a) the estimated cost of medical, prescription drug, dental and vision benefits for the Named Executive and his covered dependents for 36 months following the date of termination at an assumed annual cost of $12,000; (b) the estimated cost of life insurance for the respective Named Executives at an assumed annual cost of $967 for each of Messrs. Meier, Reynolds and Wilkes, $1,209 for Mr. Sellick and $1,165 for Mr. Ibele; (c) two years of outplacement services at an assumed annual cost of $7,500; and (d) one year of financial planning services at an assumed annual cost of $3,000. We are assuming that there is no incremental cost to us to continue the Named Executive as an insured on our directors and officers liability insurance policy. |
(6) | Represents the sum of (a) the annuity payable to each of the Named Executives under our Salary Plan, (b) the lump sum payable to each of the Named Executives under our SERP (including the effect of a special minimum benefit of $250,000, as contemplated by the change in control agreements) and (c) the balances in the respective Named Executives ESP accounts. Although each of the Named Executives is entitled, under our Salary Plan, to elect either a lump sum benefit or an annuity, as of December 31, 2006 our ability to pay lump sum benefits under the Salary Plan was restricted as a result of limitations imposed by Section 401 of the Internal Revenue Code upon lump-sum distributions to highly compensated employees. Absent that restriction, the lump sum amounts that would have been payable to the Named Executives under the Salary Plan were $1,343,265 Mr. Meier, $66,550 Mr. Sellick, $1,325,651 Mr. Reynolds, $131,876 Mr. Wilkes and $175,227 Mr. Ibele. |
40
Change in
Pension |
||||||||||||||||||||
Value and |
||||||||||||||||||||
Nonqualified |
||||||||||||||||||||
Fees Earned or |
Deferred |
All Other |
||||||||||||||||||
Paid in Cash |
Stock Awards |
Compensation |
Compensation |
Total |
||||||||||||||||
Name
|
($)(1) | ($)(1)(2) | Earnings(3) | ($) | ($) | |||||||||||||||
Carlos V. Duno
|
$ | 51,750 | $ | 40,000 | $ | 0 | $ | 0 | $ | 91,750 | ||||||||||
William A. Foley
|
60,000 | 40,000 | 0 | 0 | 100,000 | |||||||||||||||
Peter C. McC. Howell
|
59,250 | 40,000 | 0 | 0 | 99,250 | |||||||||||||||
Deborah G. Miller
|
53,500 | 40,000 | 0 | 0 | 93,500 | |||||||||||||||
Carol B. Moerdyk
|
64,000 | 40,000 | 0 | 0 | 104,000 | |||||||||||||||
Gary L. Moreau
|
56,500 | 40,000 | 0 | 0 | 96,500 | |||||||||||||||
Terence P. Stewart(4)
|
40,750 | 40,000 | 0 | 0 | 80,750 |
(1) | Includes compensation deferred into the phantom stock subaccount or the interest-bearing subaccount pursuant to the 2006 Deferred Compensation Plan for Outside Directors adopted effective January 1, 2006, and the Amended and Restated 2006 Deferred Compensation Plan for Outside Directors adopted effective October 17, 2006. |
(2) | On December 1, 2006, we awarded each non-management director RSUs having a grant date fair value, pursuant to FAS 123R, of $40,000. The RSUs, which are the only equity awards that were outstanding as of December 31, 2006, vested on January 2, 2007. The number of shares of common stock issued to each non-management director upon settlement of the RSUs was determined by dividing $40,000 (the grant date fair value) by the average closing price of our common stock over a period of 60 consecutive trading days ending on December 1, 2006. |
(3) | We do not maintain a pension plan for our non-management directors. Compensation deferred into the phantom stock subaccount does not earn an above-market return, as dividends accrue only if and to the extent payable to holders of our common stock. Compensation deferred into the interest-bearing subaccount does not earn an above-market return, as the applicable interest rate is the yield on 10-year treasuries. | |
(4) | For additional information with respect to compensation payable to Mr. Stewarts law firm for services provided to Libbey, see Corporate Governance Certain Relationships and Related Transactions What transactions involved directors or other related parties? |
41
42
43
o | 6 DETACH PROXY CARD HERE 6 |
Sign, Date and Return the
Proxy Card in the Enclosed Envelope. |
x
Votes MUST be indicated
(x) in Black or Blue ink.
|
1.
|
Election of Directors | |||||||||||
FOR all nominees listed below |
o | WITHHOLD AUTHORITY to vote
for all nominees listed below
|
o | *EXCEPTIONS
|
o |
*Exceptions |
||
(INSTRUCTIONS: To vote your shares for all Director nominees, mark
For box on Item 1. To withhold voting for all nominees mark
Withhold box. If you do not wish your shares voted for a
particular nominee, enter the name(s) of the exception(s) in the
space provided above.) |
FOR | AGAINST | ABSTAIN | ||||||||
2. | Proposal to ratify the appointment of Ernst & Young
LLP as the Companys independent auditors for the
fiscal year ending December 31, 2007 |
o | o | o | ||||||
3. | In their discretion, the Proxies are authorized to vote upon such other business as
may properly come before the meeting or any adjournment thereof. |
|||||||||
To change your address, please mark this box. | o | |||||||||
To include any comments, please mark this box. | o | |||||||||
S C A N L I N E | ||||||||||
Please sign exactly as name(s) appear hereon. Joint
owners should each sign personally. When signing as an
executor, administrator, corporation officer, attorney,
agent, trustee, guardian or in other representative
capacity, please state your full title as such. |
||||||||||
Date Share Owner sign here
|
Co-Owner sign here |
LIBBEY INC.
|
|||||||||
To: JPMorgan Chase Bank, Trustee of: | |||||||||
- Libbey Inc. Retirement Savings Plan | |||||||||
- Libbey Inc. Supplemental Retirement Plan | |||||||||
o | 6 DETACH PROXY CARD HERE 6 |
Sign, Date and Return the
Proxy Card in the Enclosed Envelope. |
x
Votes MUST be indicated
(x) in Black or Blue ink.
|
1.
|
Election of Directors | |||||||||||
FOR all nominees listed below |
o | WITHHOLD AUTHORITY to vote
for all nominees listed below
|
o | *EXCEPTIONS
|
o |
*Exceptions |
||
(INSTRUCTIONS: To vote your shares for all Director nominees, mark
For box on Item 1. To withhold voting for all nominees mark
Withhold box. If you do not wish your shares voted for a
particular nominee, enter the name(s) of the exception(s) in the
space provided above.) |
FOR | AGAINST | ABSTAIN | ||||||||
2. | Proposal to ratify the appointment of Ernst & Young
LLP as the Companys independent auditors for the
fiscal year ending December 31, 2007 |
o | o | o | ||||||
3. | In their discretion, the Proxies are authorized to vote upon such other business as
may properly come before the meeting or any adjournment thereof. |
|||||||||
To change your address, please mark this box. | o | |||||||||
To include any comments, please mark this box. | o | |||||||||
S C A N L I N E | ||||||||||
Please sign exactly as name(s) appear hereon. Joint
owners should each sign personally. When signing as an
executor, administrator, corporation officer, attorney,
agent, trustee, guardian or in other representative
capacity, please state your full title as such. |
||||||||||
Date Share Owner sign here
|
Co-Owner sign here |