Myers Industries, Inc. DEF 14A
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(RULE 14a-101)
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities
Exchange Act of 1934 (Amendment
No. )
Filed by the
Registrant þ
Filed by a Party other than the
Registrant o
Check the appropriate box:
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o Preliminary
Proxy Statement
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o Confidential,
for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
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þ Definitive
Proxy Statement
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o Definitive
Additional Materials
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o Soliciting
Material Pursuant to §240.14a-12
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MYERS INDUSTRIES, INC.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if
other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
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No fee required.
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Fee computed on table below per Exchange Act
Rules 14a-6(i)(1) and 0-11.
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(1) |
Title of each class of securities to which
transaction applies:
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Aggregate number of securities to which
transaction applies:
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Per unit price or other underlying value of
transaction computed pursuant to Exchange Act Rule 0-11
(set forth the amount on which the filing fee is calculated and
state how it was determined):
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Proposed maximum aggregate value of transaction:
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Fee paid previously with preliminary materials.
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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.
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Amount Previously Paid:
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Form, Schedule or Registration Statement No.:
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1293 South Main Street Akron, Ohio 44301
March 20, 2006
To Our Shareholders:
You are cordially invited to attend the Annual Meeting of
Shareholders to be held on Tuesday, April 25, 2006, at
9:00 A.M. at the Louis S. Myers Training Center, 1554 South
Main Street, Akron, Ohio 44301.
At the Annual Meeting you will be asked to elect nine directors,
approve amendments to the 1999 Stock Plan, and ratify the
appointment of KPMG LLP as the Companys independent
registered public accounting firm. Enclosed with this letter is
a Notice of Annual Meeting together with a Proxy Statement which
contains information with respect to the nominees for director
and the other proposals.
The proposals discussed in the Proxy Statement are very
important to the shareholders and the Company, and we hope that
you will be able to personally attend the Annual Meeting.
Whether or not you expect to attend the Annual Meeting in
person, I urge you to complete and return the enclosed proxy
card as soon as possible.
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Sincerely, |
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John C. Orr
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President and Chief Executive Officer |
Table of Contents
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1293 South Main Street Akron, Ohio 44301
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held Tuesday, April 25, 2006
The Annual Meeting of Shareholders of Myers Industries, Inc., an
Ohio corporation (Myers or the Company),
will be held at the Louis S. Myers Training Center, 1554 South
Main Street, Akron, Ohio 44301, on Tuesday, April 25, 2006
at 9:00 A.M. (local time), for the following purposes:
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1. |
To elect nine Directors; |
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2. |
To approve amendments to the Companys 1999 Stock Plan; |
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To ratify the appointment of KPMG LLP as the Companys
independent registered public accounting firm for fiscal
2006; and |
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To consider such other business if properly brought before the
meeting or any adjournments thereof. |
The Board of Directors has fixed the close of business on
March 3, 2006 as the record date for the determination of
shareholders entitled to notice of and to vote at the Annual
Meeting. All shareholders are cordially invited to attend the
meeting in person. To be sure that your shares are
properly represented at the meeting, whether you intend to
attend the meeting in person, please complete and return the
enclosed proxy card as soon as possible.
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By Order of the Board of Directors, |
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Kevin C. ONeil
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Vice President, General Counsel |
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and Secretary |
Akron, Ohio
March 20, 2006
THE 2005 ANNUAL REPORT TO SHAREHOLDERS ACCOMPANIES THIS
NOTICE
Matters Related to the Proxy Statement
Meeting Time and Applicable Dates. This Proxy Statement
is furnished in connection with the solicitation by the Board of
Directors of Myers Industries, Inc., an Ohio corporation, of the
accompanying proxy to be voted at the Annual Meeting of
Shareholders (Annual Meeting) to be held on
April 25, 2006, at 9:00 A.M. (local time), and at any
adjournment thereof. The close of business on March 3,
2006, has been fixed as the record date for the determination of
the shareholders entitled to notice of and to vote at the
meeting.
Outstanding Shares and Quorum. On the record date, Myers
had outstanding approximately 34,904,258 shares of common
stock, without par value (Common Stock), each of
which is entitled to one vote. For information concerning
Principal Shareholders of the Company, see the
section headed Security Ownership of Certain Beneficial
Owners and Management, below. The presence, in person or
by proxy, of a majority of the outstanding shares of Common
Stock is necessary to constitute a quorum for the Annual
Meeting. Shares of Common Stock represented by signed proxies
will be counted toward the establishment of a quorum on all
matters even though they are signed but otherwise unmarked, or
marked Abstain, Against or
Withhold Authority.
Votes Required. For Proposal No. 1 the election
of directors, if a quorum is present at the meeting, the
nominees for election as directors who receive the greatest
number of votes cast will be elected as directors. Abstentions
and broker non-votes will not affect the outcome of the election
of directors. For Proposal No. 2 to approve the
adoption of the amendments to the 1999 Stock Plan, the
affirmative vote of a majority of the shares of Common Stock
present or represented by proxy and entitled to vote at the
meeting is required. Abstentions and broker non-votes will be
treated as votes cast against the proposal.
Proposal No. 3 to ratify the appointment of the
independent registered public accounting firm is a non-binding
proposal, but its approval requires the affirmative vote of a
majority of the shares of Common Stock. Abstentions and broker
non-votes will have no effect. Even if the selection is
ratified, the Audit Committee and the Board, in their
discretion, may change the appointment at any time during the
year if the Company determines that such a change would be in
the best interests of the Company and its shareholders.
Proxy Instructions. All shares of Common Stock
represented by properly executed proxies which are returned and
not revoked, will be voted in accordance with the instructions,
if any, given therein. If no instructions are provided in a
proxy, the shares of Common Stock represented by such proxy will
be voted FOR the Boards nominees for director, FOR the
amendments to the 1999 Stock Plan, and FOR the ratification of
the appointment of KPMG LLP, and in accordance with the
proxy-holders
best judgment as to any other matters, if any, which may be
properly raised at the Annual Meeting.
Proxy Revocation and Voting in Person. A shareholder who
has given a proxy may revoke it at any time prior to its
exercise by giving written notice of such revocation to the
Secretary of the Company, executing and delivering to the
Secretary of the Company a later dated proxy reflecting contrary
instructions or appearing at the Annual Meeting and taking
appropriate steps to vote in person.
Inspectors of Election. The inspectors of election for
the meeting appointed by the Board shall determine the number of
votes cast by holders of Common Stock for all matters.
Address of Company. The mailing address of the principal
executive offices of the Company is 1293 South Main Street,
Akron, Ohio 44301.
Mailing Date. This Proxy Statement, together with the
related proxy card and the Companys 2005 Annual Report to
Shareholders, is being mailed to the shareholders of the Company
on or about March 20, 2006.
Trademark. Myers Industries,
Inc.®
is a registered trademark of the Company.
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PROPOSAL NO. 1 ELECTION OF DIRECTORS
Set forth below for each nominee for election as a director is a
brief statement, including the age, principal occupation and
business experience for at least the past five years, and any
directorships held with public companies.
The members of the Corporate Governance and Nominating Committee
have recommended, and the independent members of the Board of
Directors have nominated, the persons listed below as nominees
for the Board of Directors, all of whom presently are directors
of the Company, with the exception of Vincent C. Byrd. If
any nominee should become unavailable for any reason, it is
intended that votes will be cast for a substitute nominee
designated by the Board of Directors. There is no reason to
believe that the nominees named will be unable to serve if
elected. Proxies cannot be voted for a greater number of
nominees than the number named in the Proxy Statement.
THE BOARD OF DIRECTORS RECOMMENDS THE ELECTION OF THESE
NOMINEES
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Principal Occupation for Past Five Years and Other Information |
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Keith A. Brown
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President of Chimera Corporation, Westlake, Ohio, a management
holding company; and Director of US Gypsum Corporation (NYSE),
Chicago, Illinois, a manufacturer of gypsum paneling products.
Served as Director since 1997. |
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Vincent C. Byrd
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Senior Vice President, Consumer Market, The
J. M. Smucker Company
(J. M. Smucker) (NYSE), Orrville, Ohio;
Director of J. M. Smucker; formerly Vice President and
General Manager, Consumer Market, of J. M. Smucker;
Director of Spangler Candy Company, Bryan, Ohio, a manufacturer
of confectionery products. |
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Karl S. Hay
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Retired; formerly Of Counsel, the law firm of Brouse McDowell,
Akron, Ohio. Served as Director since 1969. |
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Richard P. Johnston
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Chairman of the Board of Royal Associates, Inc., Jackson Hole,
Wyoming, a holding company which owns Royal Precision Inc.
(formerly Nasdaq), a manufacturer of golf club shafts; formerly
served as Founder and Director of AGCO, Inc. (NYSE), Duluth,
Georgia, a manufacturer and distributor of agricultural
equipment. Served as Director since 1992. |
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Edward W. Kissel
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President and Managing Partner of Kissel Group Ltd., Akron,
Ohio, a holding company with interests in property, consulting
and mold manufacturing; Managing Director of Kane &
Co., Los Angeles, California, an investment banking firm;
Director of Smithers Scientific Services, Inc., Akron, Ohio, a
provider of testing services for materials; formerly President,
Chief Operating Officer and Director of OM Group, Inc. (NYSE),
Cleveland, Ohio, a specialty chemical company; formerly Director
of Weda Bay Minerals, Inc. (Toronto Stock Exchange) Toronto,
Canada, a mineral exploration company. Served as Director since
2000. |
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Stephen E. Myers
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Formerly, Chairman and Chief Executive Officer of the Company;
and Director, Reko International Group, Inc. (Toronto Stock
Exchange), Oldcastle, Ontario, Canada, a manufacturer of tooling
and machinery. Served as Director since 1972. |
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Name |
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Principal Occupation for Past Five Years and Other Information |
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John C. Orr
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President and Chief Executive Officer of the Company; formerly
President and Chief Operating Officer of the Company; formerly
General Manager of Buckhorn, Inc., a subsidiary of the Company;
formerly Vice President of Manufacturing North
American Tire Division, The Goodyear Tire and Rubber Company.
Served as Director since 2005. |
Richard L. Osborne
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Professor of Management Practice, formerly Executive Dean,
Weatherhead School of Management, Case Western Reserve
University, Cleveland, Ohio; Director of New Horizons Worldwide,
Inc. (Nasdaq), Santa Ana, California, an operator and franchiser
of computer training services; Director of Ohio Savings
Financial Corporation, Cleveland, Ohio, a savings and loan
holding company; and formerly Director of NCS Healthcare, Inc.,
Beachwood, Ohio, a provider of pharmacy services to long-term
care institutions. Served as Director since 1978. |
Jon H. Outcalt
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Chairman, Federal Process Corp., Cleveland, Ohio, a manufacturer
and distributor of industrial products; formerly Chairman of NCS
Healthcare, Inc., Beachwood, Ohio, a provider of pharmacy
services to long-term care institutions; Chairman and Chief
Executive Officer of Aberdeen Group, Inc., Beachwood, Ohio, an
investment holding and management company; Director of Ohio
Savings Financial Corporation, Cleveland, Ohio, a savings and
loan holding company. Served as Director since 1984. |
There are, and during the past five years there have been, no
legal proceedings material to an evaluation of the ability of
any director or executive officer of Myers to act in such
capacity or concerning his integrity. There are no family
relationships among any of the directors and executive officers.
Director Independence. The Board has determined that each
of the following directors are independent and that
each of these nominees has no material relationship with the
Company which would impact upon their independence:
Keith A. Brown, Vincent C. Byrd, Karl S. Hay,
Richard P. Johnston, Edward W. Kissel, Richard L.
Osborne, and Jon H. Outcalt. The determination of whether a
director is independent is based upon the
Boards review of the relationships between each director
and the Company, if any, under the Companys Board of
Directors Independence Criteria policy adopted by the
Board on April 20, 2004 and the corporate governance
listing standards of the New York Stock Exchange. All members of
the Audit Committee, the Compensation Committee, and the
Corporate Governance and Nominating Committee were determined to
be independent as above, and in addition, the Board determined
that the members of the Audit Committee are also independent as
defined in the Securities and Exchange Commission
(SEC) regulations.
Committees of the Board. The Board of Directors of Myers
has three standing committees, the Audit Committee, the
Compensation Committee, and the Corporate Governance and
Nominating Committee, whose members were appointed in April 2005
following the Annual Meeting.
Audit Committee. The Audit Committee is composed of three
independent directors, Keith A. Brown, Chair and Presiding
Director, Karl S. Hay, and Jon H. Outcalt. The
functions of this Committee, which met 10 times in 2005,
are to engage the independent registered public accounting firm,
approve all audit and related engagements (audit and non-audit),
review the results of the audit and interim reviews, evaluate
the independence of the independent registered public accounting
firm, review with the independent registered public accounting
firm the financial results of the Company prior to their public
release and filing of reports with the SEC, direct and supervise
special investigations and to oversee the Companys
accounting, internal accounting controls and auditing
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matters reporting hotline (discussed below) and its corporate
compliance program. The Committee also has oversight of the
Companys system of internal auditing functions and
controls, as well as the Companys internal control
procedures.
None of the Audit Committee members serves on more than one
other audit committee of another public company.
The Board of Directors has determined that a majority of the
current Audit Committee members would qualify as an audit
committee financial expert, and that each member of the
Committee is independent under the independence
standard adopted by the Board. The Board, however, has
determined not to name any single member of the Audit Committee
as a financial expert since the Board does not
believe such a designation is necessary either for the Audit
Committee or Boards effective performance.
Compensation Committee. The Compensation Committee
establishes and administers the Companys policies,
programs and procedures for compensating its executive officers
and Board of Directors. The Committee has the authority to
retain outside consultants regarding executive compensation and
other matters. The Compensation Committee, which met seven times
in 2005, has as its members three independent directors, Jon H.
Outcalt, Chairman and Presiding Director, Edward W. Kissel, and
Richard L. Osborne.
Corporate Governance and Nominating Committee. The
Corporate Governance and Nominating Committee (Governance
Committee) is responsible for, among other things,
evaluating new director candidates and incumbent directors, and
recommending to the independent directors of the Board of
Directors, nominees to serve on the Board of Directors as well
as members of the Boards committees. The Committee, which
met four times in 2005, has as its members three independent
directors, Edward W. Kissel, Chairman and Presiding Director,
Richard P. Johnston, and Richard L. Osborne.
Committee Charters and Policies. The Board of Directors
has adopted written charters for the Audit Committee, the
Compensation Committee, and the Corporate Governance and
Nominating Committee. Each Committee reviews and evaluates the
adequacy of its charter at least annually and recommends any
proposed changes to the Board of Directors for approval. Each of
the written charters and policies of the Committees of the Board
are available in the Corporate Governance page
accessed from the Investor Relations page of the
Companys website at www.myersind.com. Copies are
also available upon request to the Companys Secretary at
the Companys address listed herein.
Board Attendance. There were a total of seven regularly
scheduled and special meetings of the Board of Directors in
2005. During 2005, all directors attended at least 75% of the
aggregate total number of the meetings of the Board and
Committees on which they served. In 2005, as well as for at
least the seven Annual Shareholder Meetings which preceded it,
all of the directors attended the Companys Annual
Shareholder Meeting. Although the Company does not have a formal
policy requiring directors to attend the annual meeting of
shareholders, directors are encouraged to attend.
Interested Parties Communications with the Board of
Directors. The Companys Board of Directors provides
the following methods for interested parties and shareholders to
send communications to a director, a Committee, to the
non-management directors, or to the Board:
Written Communication. Interested parties may send such
communications by mail or courier delivery addressed as follows:
Board of Directors (or Committee Chair, Board Member or
Non-Management Directors, as the case requires), c/o Kevin
C. ONeil, General Counsel, Myers Industries, Inc., 1293
South Main Street, Akron, Ohio 44301. The General Counsel will
forward all such communications directed to the Board of
Directors or to the Non-Management Directors,
unopened, to the Chair of the Governance Committee. The
Committee Chair in turn determines whether the communications
should be forwarded to the appropriate members of the Board and,
if
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so, forwards them accordingly. However, for communications
addressed to a particular member of the Board or the Chair of a
particular Board Committee, the General Counsel will forward
those communications, unopened, directly to the person or
Committee Chair in question.
Toll Free Hotline. The Audit Committee established in
2003 a hotline for receiving, retaining and treating
complaints from any interested party regarding accounting,
internal accounting controls and auditing matters, and
procedures for the anonymous submission of these concerns. The
hotline is maintained by a company which is independent of the
Company. Interested parties may also use this hotline to
communicate with the Board. Any interested party may contact a
director, a Committee the non-management directors, or the Board
through the toll free hotline at
(877) 285-4145.
The hotline is available worldwide, 24 hours a day, seven
days a week. Note that all reports made through the hotline are
directed to the Chair of the Audit Committee, the Chief
Financial Officer and to the General Counsel. The Company does
not permit any retaliation of any kind against any person who,
in good faith, submits a complaint or concern under these
procedures.
Shareholder Nominations of Director Candidates. The
Governance Committee will consider individuals for nomination to
stand for election as a director who are recommended to it in
writing by any shareholder of the Company. A shareholder wishing
to recommend an individual as a nominee must follow the
procedure outlined below and then send the signed letter of
recommendation, to the following address: Corporate Governance
and Nominating Committee, c/o Mr. Kevin C.
ONeil, General Counsel, Myers Industries, Inc.,
1293 South Main Street, Akron, Ohio 44301.
Recommendation letters must certify that the person making the
recommendation is a shareholder of the Company (including the
number shares held as of the date of the recommendation), and
further state the reasons for the recommendation, the full name
and address of the proposed nominee as well as a biographical
history setting forth past and present directorships,
employments, occupations and civic activities for at least the
past five years. Any such recommendation should be accompanied
by a signed written statement from the proposed nominee
consenting to be named as a candidate and, if nominated and
elected, consenting to serve as a director. The letter must also
include a signed written statement that the nominating
shareholder and the candidate will make available to the
Committee all information reasonably requested in furtherance of
the Committees evaluation. The letter must be received
before the close of business on or before
November 15th of the year before the next annual
meeting.
For this meeting, there were no nominees recommended by a
shareholder nor was a third party engaged to assist in the
process of identifying or evaluating nominees for the Board of
Directors.
Corporate Governance Policies
Implementation. The Board of Directors has implemented
the corporate governance initiatives required by the NYSE rules
and the Sarbanes-Oxley Act of 2002. These include, among others,
Corporate Governance Guidelines, a Code of
Business Conduct and Ethics for the Companys
directors, officers and employees, as well as a Code of
Ethical Conduct for the Finance Officers and Finance Department
Personnel. These Corporate Governance policies and
procedures are discussed in various places within this Proxy
Statement.
Availability of Policies. Each of the Companys
policies are available on the Corporate Governance
page accessed from the Investor Relations page of
the Companys website at www.myersind.com. Copies of
the policies are also available upon request of the
Companys Secretary.
Executive Sessions of the Board. Effective in December
2002, the Board adopted a policy requiring the non-management
directors, both as to the Board and in their respective
Committees, to meet regularly in executive session without any
management personnel or employee directors present. During 2005,
the Board of Directors and each Committee met regularly in
executive session
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as follows: Board of Directors, seven times; Audit Committee, 10
times; Compensation Committee, seven times; and the Governance
Committee, four times.
Presiding Directors. The non-management directors
reported that in 2005 they selected Presiding Directors to
preside during executive sessions. The Chair of the Governance
Committee acts as the Presiding Director for the executive
sessions of the Board, and the Chair of each Committee was
selected as the Presiding Director for the executive sessions of
the applicable Committee.
Anonymous Reporting. The Audit Committee maintains
procedures, including a worldwide telephone hotline,
which allows employees and interested parties to report any
financial or other concerns anonymously as further detailed
under Interested Parties Communications with the Board of
Directors, above.
Annual Board and Committee Self-Assessments. In 2004, the
Board of Directors, through the Governance Committee, instituted
annual self-assessments of the Board of Directors, as well as
the Audit Committee, the Compensation, and the Corporate
Governance and Nominating Committee, to assist in determining
whether the Board of Directors and its Committees are
functioning effectively. In December 2005, the Board and each of
its Committees completed the most recent self-evaluations as
well as reviewed and discussed the results.
NYSE and SEC Certifications. The Company submitted to the
NYSE in 2005, an unqualified Section 12(a) certification by
its Chief Executive Officer. Further, each applicable filing
with the SEC contained the Section 302 and 906
Certifications of the Companys Chief Executive Officer and
Chief Financial Officer.
Director Compensation. The annual retainer for
non-employee directors is $25,000, except for the Audit
Committee chair, who receives an annual retainer of $30,000. In
addition, directors receive a meeting fee of $1,500 for each
scheduled board, committee or board dinner meeting which they
attend, except that committee chairs receive $2,000 for each
meeting of their committee. Directors who are not appointed
members of a committee, are paid a meeting fee if they attend
the committee meeting at the request of the chair of the
committee. Directors are reimbursed for their reasonable out of
pocket expenses related to attending board and committee
meetings.
Directors who are employees of the Company do not receive either
the retainer nor the meeting fees.
Under the Companys 1999 Stock Option Plan, each
non-employee director who held such position on the day before
the Annual Shareholder Meeting, is awarded annually on the day
of the meeting, a non-qualified stock option to purchase
2,500 shares of the Companys Common Stock. The option
price per share is 100 percent of the fair market value
(being the closing price on the NYSE on the day of grant) of a
share of Common Stock.
The Companys Code of Regulations provide that the Company
will indemnify, to the full extent then permitted by law, any
director or former director of the Company who was or is a party
or is threatened to be made a party to any matter, whether civil
or criminal, by reason of the fact that the individual is or was
a director of the Company, or serving at the request of the
Company of another entity. The Company has entered into
indemnity agreements with each of its directors contractually
obligating the Company to provide such protection. The Company
also currently has in effect director and officer insurance
coverage.
Audit Committee Report
The Audit Committee is responsible for assisting the Board of
Directors in fulfilling its oversight responsibilities
pertaining to the accounting, auditing and financial reporting
processes of the Company. Management is responsible for
establishing and maintaining the Companys internal control
over financial reporting and for preparing financial statements
in accordance with accounting principles generally accepted in
the United States of America. The Audit Committee is directly
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responsible for the appointment, oversight, compensation and
retention of KPMG LLP, the independent registered public
accounting firm for the Company. KPMG LLP is responsible for
performing an independent audit of the Companys annual
financial statements and expressing an opinion on (i) the
conformity, in all material respects, of the Companys
financial statements with accounting principles generally
accepted in the United States of America,
(ii) managements assessment of the effectiveness of
internal control over financial reporting, and (iii) the
effectiveness of internal control over financial reporting.
Each member of the Audit Committee is financially literate and
independent as defined under the Companys Independence
Criteria policy. The Board of Directors has also determined that
a majority of the current Audit Committee members would qualify
as an audit committee financial expert as that term
is defined in the SEC regulations. The Board, however, has
determined not to name any single member of the Audit Committee
as a financial expert since the Board does not
believe such a designation is necessary either for the Audit
Committee or Boards effective performance.
The Audit Committees responsibility is one of oversight.
Members of the Audit Committee rely on the information provided
and the representations made to them by: management, which has
primary responsibility for establishing and maintaining
appropriate internal control over financial reporting, and for
the Companys financial statements and reports; and by the
independent registered public accounting firm, which is
responsible for performing an audit in accordance with Standards
of the Public Company Accounting Oversight Board
United States (PCAOB) and expressing an opinion on
(i) the conformity, in all material respects, of the
Companys financial statements with accounting principles
generally accepted in the United States of America,
(ii) managements assessment of the effectiveness of
internal control over financial reporting, and (iii) the
effectiveness of internal control over financial reporting.
In this context, we have reviewed and discussed with management
the Companys audited financial statements as of and for
the year ended December 31, 2005. We have discussed with
KPMG LLP, the independent registered public accounting firm for
the Company, the matters required to be discussed by PCAOB
Interim Auditing Standard AU Section 380, Communication
with Audit Committees.
We have received and reviewed the written disclosures and the
letter from KPMG LLP required by Independence Standards Board
Standard No. 1, Independence Discussions with Audit
Committees, as amended, and have discussed with them their
independence. We have concluded that KPMG LLPs provision
of audit and non-audit services to the Company is compatible
with their independence. Based on the reviews and discussions
referred to above, and exercising our business judgment, we
recommended to the Board of Directors that the financial
statements referred to above be included in the Companys
Annual Report on
Form 10-K for the
year ended December 31, 2005 for filing with the SEC. We
have selected KPMG LLP as the Companys independent
registered public accounting firm for fiscal 2006, and have
approved submitting the selection of the independent registered
public accounting firm for ratification by the shareholders.
The foregoing report has been furnished by the current members
of the Audit Committee, being:
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Keith A. Brown, Chair and Presiding Director |
Jon H. Outcalt |
Karl S. Hay |
Compensation Committee Report on Executive Compensation
The Compensation Committee, which is composed of three
independent directors, operates under a written charter adopted
by the Committee and ratified by the Board of Directors. A copy
of the charter is available on the Companys website. The
Committee is responsible, among other duties, for establishing
and administering the policies which govern executive
compensation.
The executive compensation program for the Named Executive
Officers is administered by the Compensation Committee. The
Committees function is to review the performance of the
Chief
8
Executive Officer (CEO) and the other Named
Executive Officers in determining the amount and type of
compensation to be paid and awarded, as well as approve
compensation adjustments and to make awards of cash bonuses and
stock based compensation, if deemed appropriate. The
Compensation Committee primarily bases its decisions on
qualitative factors, exercising its discretion and using its
judgment after considering those factors it deems relevant.
In May 2005, the Board appointed John C. Orr as the new CEO for
the Company. Mr. Orr had previously held the position of
Chief Operating Officer (COO). As part of the CEO
succession planning process and the establishment of the
compensation for the new CEO, the Committee reviewed
Mr. Orrs performance as COO, which included in part a
review of the Companys operations, results, cost
containment and reductions, as well as his leadership skills. In
addition, the Committee conducted an assessment of his abilities
to meet the goals and objectives being set for him as CEO in
areas such as strategic planning, financial results (annual and
long-term), and succession planning, as well taking into
consideration the increase in responsibilities and obligations
in his new position as CEO. The Committee also reviewed publicly
available compensation information for companies similar to the
Company in one or more ways, such as those with like amount of
sales, market value, products, or within the same industry or
geographic area. The confidential opinions of the independent
members of the Board of Directors were also considered. This
process resulted in setting Mr. Orrs base salary at
$600,000.
The Committee also has the authority to award Mr. Orr a
cash bonus and stock based compensation, both of which are fully
discretionary. In determining the CEOs cash bonus for
fiscal 2005, the Committee used the same factors discussed
above, but placed more emphasis on the relative performance of
the Company as a whole, and upon other qualitative measures of
the Companys performance in 2005. This process resulted in
awarding the CEO a cash bonus of $290,000 for fiscal 2005,
payable in March 2006. These same factors were used to award
Mr. Orr a grant for stock options equal to
25,000 shares of Company stock at an exercise price of
$11.15 per share, which was the fair market value of the
stock on May 31, 2005.
The Committee is establishing financial and performance
objectives for 2006 and will use these to evaluate Mr. Orr
in establishing future compensation.
For the Named Executive Officers other than the CEO, in
determining their base salary, while the Committee reviews each
individuals performance, the primary factor used by the
Committee is the recommendation of the CEO. The Committees
review of performance and determination of compensation is based
upon the same factors as mentioned above for the CEO, but as
applicable to the executives duties and responsibilities.
The Committee also has the authority to award the other Named
Executive Officers a cash bonus and stock based compensation,
both of which are fully discretionary. The cash bonus awards for
the other Named Executive Officers for fiscal 2005 were
determined by the Committee in February 2006, with the exception
of Mr. Stodnick which was determined in January 2006, and
were paid in March 2006. These same factors were used to award
the other Named Executive Officers a grant for stock options at
an exercise price of $11.15 per share, which was the fair
market value of the stock on May 31, 2005.
The Company does not have a formal written plan regarding the
award of cash bonuses. All awards of cash bonuses for fiscal
2005 were fully discretionary. The Committee is establishing
financial and performance objectives for 2006 and will use these
as part of its evaluation of the other Named Executive Officers
in establishing future compensation.
The Committee has reviewed the qualifying compensation
regulations under Internal Revenue Code (IRC)
Section 162(m) as issued by the Internal Revenue Service
which provide that no federal income tax deduction is allowed
for applicable employee remuneration paid by a publicly held
corporation to a covered employee to the extent that the
remuneration paid to the employee exceeds $1.0 million for
the applicable taxable year, unless certain conditions are met.
Currently,
9
remuneration in 2005 for the Named Executive Officers did not
exceed the $1.0 million base for any covered
U.S. employee. The Committee reviews this matter annually.
It is the Committees view that the relationship between
compensation of the Named Executive Officers and the
Companys performance is appropriate and serves the
shareholders interests.
The foregoing report has been furnished by the current members
of the Compensation Committee, being:
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Jon H. Outcalt, Chairman and Presiding Director |
Edward W. Kissel |
Richard L. Osborne |
PROPOSAL NO. 2 APPROVAL OF AMENDMENTS TO THE
1999 STOCK PLAN
The Board of Directors has adopted, subject to shareholder
approval, an amendment to the Myers Industries, Inc. 1999 Stock
Plan (the 1999 Stock Plan). The Board of Directors
believes that approval of the amendment to the 1999 Stock Plan
will advance the interests of the Company and its shareholders
by providing eligible non-employee directors and Company
employees with stock based compensation.
The Board of Directors Recommends That the
Shareholders
Approve the Amendments to the 1999 Stock Plan
Summary of the 1999 Stock Plan Amendments. The following
summary description of the amendment to the 1999 Stock Plan is
qualified in its entirety by reference to the full text of the
1999 Stock Plan. Copies of the 1999 Stock Plan may be obtained
by a shareholder upon written request to the Secretary of the
Company.
Overview. The 1999 Stock Plan was originally approved by
the shareholders in April 1999. It contains provisions for the
grant of stock options to directors (Directors Plan)
and to employees (Employee Plan). The proposed
amendments, which have been approved by the Board subject to
shareholder approval, are believed to be both necessary and
reasonable and reflect changes which many companies have already
or are proposing to make. The changes are necessary due to the
recent changes to the accounting rules which have impacted the
favorable treatment of stock options. The 1999 Plan currently
only allows grants of stock options. The proposed amendments
would add the ability of the Board to grant other types of stock
based awards, such as stock appreciation rights, performance
awards, restricted stock or restricted stock equivalents, or
other forms of equity-based awards consistent with the purposes
of the Plan.
Director Plan Amendments. The Director Plan currently
provides that up to a total of 30,650 shares of Common
Stock may be issued as stock options to directors. The proposed
amendment would, starting in April 2007, provide each
non-employee director who was serving as such on the day before
the annual meeting, an award of restricted stock for
1,000 shares of Common Stock. The restricted shares would
vest equally over four years, and would not have voting or
dividend rights until vested. Vesting for any restricted stock
award would accelerate at the end of a directors term
whether due to resignation, death, disability, retirement or
determination not to stand for
re-nomination.
This is a change in the type of grant previously approved by the
shareholders. Currently non-employee directors are awarded a
grant of stock options on the day after the Annual Meeting of
Shareholders, to acquire 2,500 shares of Common Stock at
the fair market value on the date of grant, which options vest
after one year.
The Director Plan would also be amended so the total number of
shares available would be increased by 5,350 shares from
the current 30,650, to 36,000. This would provide for sufficient
shares for proposed grants through April 2009. These shares
would be taken from the Employee portion of the Plan so there
would be no increase of the total number of shares authorized
under the Plan.
10
The Director Plan is a self-executing program in that the annual
grant is made automatically. It is administered by the Chief
Financial Officer of the Company.
Employee Plan Amendments. The Employee Plan, as approved
by the shareholders in 1999, provides that up to a total of
1,084,323 shares of Common Stock may be granted as stock
options to employees. This is only about 3.1% of the
Companys outstanding shares of Common Stock. Options must
be awarded at an exercise price equal to the fair market value
of the Company Stock on the date of grant. Eligible employees
under the Employee Plan are salaried employees, including
executive officers of the Company. The Compensation Committee,
in its discretion, selects those eligible employees who receive
awards. The Company is not obligated to make awards under the
Employee Plan at any time.
The current Employee Plan only provides for the grant of stock
options and re-load stock options. The amendments would also
allow for the following types of grants:
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stock appreciation rights; |
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performance awards either as performance shares (with each
performance share representing one share of Common Stock) or
performance units (representing a dollar amount established by
the Compensation Committee at the time of the award); |
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restricted stock or restricted stock equivalents; and |
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other forms of equity-based awards consistent with the purposes
of the Plan. |
The amendments would remove the right to grant
re-load stock options.
The amendments would also include the following restrictions on
grants:
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For restricted stock or restricted stock equivalents granted to
employees, the restriction periods must be at least three years
for time-based restrictions, and at least one year for
performance-based restrictions. |
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No annual grant under the Plan can exceed 2.0% of shares of
Common Stock in any fiscal year pursuant to stock options,
performance awards, restricted stock awards and restricted stock
equivalent awards. Over the past four years, the average grant
under the 1999 Plan was less than .5% per year. |
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No employee, including executive officers, may receive more than
1.5% of shares of Common Stock in any fiscal year pursuant to
stock options, performance awards, restricted stock awards and
restricted stock equivalent awards. The largest grant under the
1999 Plan to date was less than .01%. |
During the fiscal year ended December 31, 2005, options
were granted under the Employee Plan covering
309,310 shares to 246 employees, including the Named
Executive Officers. During the fiscal year ended
December 31, 2004, however, no stock options were granted.
It is not currently possible to identify the persons to whom
grant of awards will be made in the future, nor is it possible
to state the form or value of any future awards. The closing
price of the Common Stock on the NYSE on March 8, 2006 was
$15.73.
The Employee Plan would also be amended so the total number of
shares available would be decreased by 5,350 shares, upon
the transfer of these shares to the Director Plan.
Assuming the Employee Plan amendments are approved by the
shareholders, the following types of grants would then be
available to the Compensation Committee of the Board. The
Employee Plan is fully discretionary in that any awards can only
be made by the Compensation Committee, which administers the
Plan.
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Stock Options. May be either incentive or non-qualified
stock options at 100% of the fair market value on the date of
the award. The date when stock options first become exercisable |
11
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must be at least six months after the date of grant. Options may
have a term of up to ten years. The full purchase price of any
stock option must be paid upon exercise either in
(i) immediately available funds, (ii) shares of Common
Stock having an aggregate fair market value equal to the full
purchase price, (iii) a combination of (i)
and (ii), or (iv) by use of a cashless exercise
procedure. Subject to the term of the grant agreement, options
which are vested may be exercisable for a limited time following
termination of employment due to death, disability, retirement,
voluntary resignation, termination without cause, or with the
consent of the Committee. Upon any other kind of termination,
unless there is a written agreement to the contrary, they
immediately expire. |
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Stock Appreciation Rights. May entitle the grantee to
receive, upon exercise of the right, an amount equal to the
excess of (a) the fair market value of a specified number
of shares of Common Stock, minus (b) the exercise price of
the right. The exercise price may not be less than the fair
market value of Common Stock on the date the right is granted.
The date when stock appreciation rights (SARs)
first become exercisable must be at least six months after the
date of grant. SARs may have a term of up to ten years.
The amount due to the grantee may be paid in Common Stock, in
cash, or in a combination of cash and Stock. Subject to the
terms of the grant agreement, vested SARs may remain
exercisable for a limited time following termination of
employment due to death, disability, retirement, voluntary
resignation, termination without cause, or with the consent of
the Committee. Upon any other kind of termination, unless there
is a written agreement to the contrary, they immediately expire. |
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Performance Awards. May be granted either as performance
shares (with each performance share representing one share of
Common Stock) or performance units (representing a dollar amount
established by the Compensation Committee at the time of the
award). Performance awards are earned over a performance period
of at least one year. The Compensation Committee would establish
minimum, target, and maximum performance goals when it makes
performance awards. The Compensation Committee would determine
the portion of the performance award earned by the participant
based on the degree to which the performance goals are achieved
over the relevant performance period. A participant would not
earn any portion of a performance award unless the minimum
performance goals are met, if set. When earned, performance
awards are paid in cash, in Common Stock or in a combination of
cash and Stock, and in a lump sum or in installments. The
Compensation Committee determines the form and manner of
payment. The Plan also authorizes the Committee, subject to the
restrictions of Section 162(m) of the IRC, to reduce grants
or adjust performance goals if the Company acquires or disposes
of assets or securities. |
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Restricted Stock or Restricted Stock Equivalents.
Restricted stock awards may have voting and dividend rights, but
are restricted from vesting due to performance criteria, time or
a combination of performance or time. Restriction periods must
be at least three years for time-based restrictions and at least
one year for performance-based restrictions. An executive
officer granted restricted stock may be required to retain all
or a portion of the shares after vesting for a minimum time
period. Each restricted stock equivalent represents the right to
receive an amount determined by the Committee at the time of the
award. The value of a restricted stock equivalent may be equal
to the full monetary value of one share of our common stock.
Holders of restricted stock equivalents do not have rights as a
shareholder prior to vesting and payment in shares. Any award of
restricted stock or stock equivalents to an executive officer
intended to qualify as performance-based compensation must
include a stock price goal during the restriction period.
Subject to the terms of the grant agreement, restricted stock
awards may continue to vest following termination of employment
due to death, disability, retirement, voluntary resignation,
termination without cause, or with the consent of the Committee.
Upon any other kind of termination, unless there is a written
agreement to the contrary, they immediately expire. |
12
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Other Stock-Based Awards. To provide for flexibility, the
Committee is authorized to grant other types of awards under the
Plan that are denominated or payable in, valued by reference to,
or otherwise based on or related to shares of Common Stock. Such
awards might include convertible or exchangeable debt
securities, other rights convertible or exchangeable into shares
of Common Stock, purchase rights for shares of Common Stock,
awards with value and payment contingent upon the Companys
performance or any other factors designated by the Committee. |
Provisions Applicable to the Director and Employee Plans.
Participants who leave the Company may lose their unexercised
stock options and stock appreciation rights, their unearned
performance awards and their restricted stock and stock
equivalent awards, if they fail to honor consulting or
non-competition obligations to the Company or fail to satisfy
other terms specified in the award.
In the event the outstanding shares of the Companys Common
Stock are increased or decreased as a result of stock dividends,
stock splits, recapitalizations, reorganizations or other
changes in corporate structure effected without the receipt of
consideration, or in the event the Companys Common Stock
is converted into other shares or securities of the Company or
any other corporation in connection with a corporate
transaction, then appropriate adjustments will be made to the
class and/or number of shares available for subsequent issuance
under the 1999 Stock Plan.
In the event of a Change in Control, all grants
outstanding under the 1999 Stock Plan immediately vest in full,
except (and to the extent) there are limitations at the time the
grants are made expressly stating otherwise. The acceleration of
the vesting could have the effect of discouraging a Change in
Control of the Company, and in the Board or management, even
though such Change in Control could be favored by a majority of
shareholders.
For purposes of valuation under the 1999 Stock Plan, the fair
market value of a share of Common Stock, on any relevant date,
is the reported closing price per share on the NYSE.
No material modification to the 1999 Stock Plan may be made
without shareholder approval, such as an increase in the total
number of shares issuable under the 1999 Stock Plan. The Board
of Directors may at any time amend, suspend or terminate the
1999 Stock Plan, in whole or part, provided such action does not
materially alter the Plan or adversely affect the rights of
participants with respect to outstanding options or shares.
Unless sooner terminated by Board action, the 1999 Stock Plan
will terminate upon the earlier of (i) ten years after
adoption, or (ii) the first date when all the shares of the
Companys Common Stock available for issuance thereunder
have been issued. Outstanding awards at the time of Plan
termination remain in effect pursuant to the terms of the Plan
and grant agreement.
Certain Federal Income Tax Consequences. The following
discussion summarizes certain federal income tax consequences of
the issuance and exercise of stock options and stock
appreciation rights awarded under the 1999 Stock Plan. The
summary does not address all federal tax consequences, nor does
it cover state or local tax consequences.
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ISOs are intended to qualify as incentive stock
options under Section 422 of the IRC. Under current
federal income tax law: |
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Employees do not recognize income when granted incentive stock
options. |
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An optionee does not recognize income when an ISO is exercised,
although the difference between the option price and the fair
market value of the shares acquired upon exercise is a tax
preference item which, under certain circumstances, may
give rise to alternative minimum tax liability on the part of
the optionee. |
13
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If the optionee holds shares purchased pursuant to the exercise
of an ISO for cash for at least two years from the option grant
date and at least one year after the transfer of the shares to
the optionee, then: |
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The optionee will recognize gain or loss only upon ultimate
disposition of the shares. Any gain or loss generally will be
treated as long-term capital gain or loss. |
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The Company will not be entitled to a federal income tax
deduction in connection with the grant or the exercise of the
option. |
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If the optionee disposes of the shares purchased pursuant to the
exercise of an ISO before the expiration of the required holding
period, then: |
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The optionee will recognize ordinary income in the year of the
disposition in an amount equal to the difference between the
option price and the lesser of the fair market value of the
shares on the exercise date or the selling price. The balance of
any gain the optionee realizes on the disposition will be taxed
as capital gain. |
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The Company will be entitled to a deduction in the year of the
disposition equal to the amount of ordinary income recognized by
the optionee. |
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Non-qualified stock options are stock options that
do not qualify as ISOs. Under current federal income tax law: |
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Employees do not recognize income when granted non-qualified
stock options. |
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Upon exercise of a non-qualified option, the optionee recognizes
ordinary income in the amount by which the fair market value of
the shares purchased exceeds the exercise price of the option.
The Company generally is entitled to a deduction in an equal
amount. |
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The optionees tax basis in shares purchased upon exercise
of a non-qualified option is the value of the shares on the
exercise date. Any gain or loss that the optionee realizes upon
disposition of the shares will generally be treated as capital
gain or loss. The gain or loss will be long-term if the shares
have been held longer than one year. |
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Stock Appreciation Rights. Under existing U.S. federal
income tax law: |
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Employees do not recognize income when granted stock
appreciation rights. |
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When a stock appreciation right is exercised, the grantee must
treat the cash and the fair market value of any stock received
upon exercise as ordinary income. The Company generally is
entitled to a deduction in an equal amount. |
Other Tax Matters. Certain additional rules apply if an
optionee pays the exercise price of an option with shares he
already owns. An optionee may be permitted to have the Company
withhold all or a portion of the shares that the optionee
acquires upon the exercise of an option to satisfy estimated or
actual federal, state or local income taxes. The Company may
also permit the optionee to deliver other previously acquired
shares (other than restricted stock) for the purpose of tax
withholding.
Plan Benefits. Because awards under the Plan are
determined by the Compensation Committee in its sole discretion,
the benefits or amounts that may be received or allocated in the
future under the Employee Plan cannot be determined. The table
below shows stock options granted in 2005 to
14
the individuals and groups indicated. These awards are not
necessarily indicative of awards that may be made in the future.
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Stock | |
Name and Position/Group |
|
Options(1) | |
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John C. Orr, President and Chief Executive Officer
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25,000 |
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Gregory J. Stodnick, Vice President Finance and
Chief Financial Officer
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17,000 |
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Kevin C. ONeil, Vice President, General Counsel and
Secretary
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13,000 |
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Stephen E. Myers, Former Chairman and Chief Executive Officer
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2,500 |
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Named Executive Officers (3 persons)
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55,000 |
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Non-Employee Director Group (6 persons)
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17,500 |
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Employee Group (243 persons Excluding Named Executive Officers)
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251,000 |
|
Under the current Director Plan, in April 2006 the non-employee
directors will each receive an option grant to purchase a total
of 2,500 shares of Common Stock which vests in one year.
Assuming the Director Plan amendment is approved by the
shareholders, starting in April 2007 and annually thereafter,
the non-employee directors will each receive a grant of
1,000 shares of restricted stock which vests equally over
four years.
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Stock | |
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Restricted | |
Group |
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Options(1) | |
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Stock | |
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Non-Employee Director Group
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April 2006 (7 persons)
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17,500 |
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0 |
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April 2007 (7 persons)
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0 |
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7,000 |
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(1) |
Market-priced options that vest over one year and have a
ten-year term. |
15
EXECUTIVE COMPENSATION AND RELATED INFORMATION
Summary of Cash and Certain Other Compensation. The
following table contains certain information regarding aggregate
compensation earned, paid or payable during 2005, 2004 and 2003,
for services rendered to the Company and its subsidiaries during
these fiscal years, to: (a) the chief executive officer;
and (b) the two most highly compensated executive officers
who were serving as executive officers at the end of 2005; and
(c) one former executive officer, who would have been among
the executive officers described in (b) had he still been
serving as an executive officer of the Company at the end of
2005 (collectively, the Named Executive Officers).
Summary Compensation
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Long-Term | |
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Annual Compensation | |
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Compensation(1) | |
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Securities | |
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Name and |
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Other | |
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Underlying | |
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All | |
Principal Position |
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Year | |
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Salary | |
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Bonus(2) | |
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Annual | |
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Options/SARs | |
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Other | |
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Compensation(3) | |
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Other(4) | |
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Compensation(5) | |
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John C. Orr
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2005 |
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$ |
550,000 |
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$ |
290,000 |
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$ |
0 |
|
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$ |
25,000 |
|
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$ |
276,650 |
|
President and Chief |
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2004 |
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350,000 |
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100,000 |
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0 |
|
|
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0 |
|
|
|
17,092 |
|
Executive Officer |
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|
2003 |
|
|
|
350,000 |
|
|
|
45,000 |
|
|
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0 |
|
|
|
3,000 |
|
|
|
13,088 |
|
|
Gregory J. Stodnick
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2005 |
|
|
|
320,000 |
|
|
|
160,000 |
|
|
|
0 |
|
|
|
17,000 |
|
|
|
3,732 |
|
Vice President- |
|
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2004 |
|
|
|
250,000 |
|
|
|
145,000 |
|
|
|
0 |
|
|
|
0 |
|
|
|
4,020 |
|
Finance |
|
|
2003 |
|
|
|
247,917 |
|
|
|
100,000 |
|
|
|
0 |
|
|
|
5,000 |
|
|
|
4,398 |
|
|
Kevin C. ONeil
|
|
|
2005 |
|
|
|
236,385 |
|
|
|
70,000 |
|
|
|
0 |
|
|
|
13,000 |
|
|
|
138,151 |
|
Vice President, |
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2004 |
|
|
|
170,000 |
|
|
|
90,000 |
|
|
|
0 |
|
|
|
0 |
|
|
|
3,608 |
|
General Counsel |
|
|
2003 |
|
|
|
170,000 |
|
|
|
60,000 |
|
|
|
0 |
|
|
|
5,000 |
|
|
|
4,037 |
|
and Secretary |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stephen E. Myers
|
|
|
2005 |
|
|
|
486,667 |
|
|
|
0 |
|
|
|
0 |
|
|
|
2,500 |
|
|
|
3,417 |
|
Former Chairman |
|
|
2004 |
|
|
|
350,000 |
|
|
|
100,000 |
|
|
|
0 |
|
|
|
0 |
|
|
|
3,705 |
|
and Chief Executive |
|
|
2003 |
|
|
|
345,833 |
|
|
|
65,000 |
|
|
|
0 |
|
|
|
10,000 |
|
|
|
4,083 |
|
Officer |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
No long-term incentive plan pay-outs were made in 2004. |
|
(2) |
The total amount of cash bonus awarded and accrued for the prior
year, but which is determined and awarded after the close of the
last fiscal year (i.e., the bonus for 2005, determined and
awarded in 2006). Prior to 2006, the bonus amount was generally
paid 50% at the time of award, with the balance paid at 25% on
each of the following two years. With the exception of
retirement, any remaining amount of bonus payable may be
forfeited if the executive officer is not employed by the
Company prior to the full distribution of the bonus award. |
|
(3) |
The Company provides its executive officers with personal
benefits as part of providing a competitive compensation
program. These may include such benefits as a company
automobile, insurance costs reimbursement, an annual physical,
club membership, tax reimbursement, and reimbursement for basic
financial planning. These benefits are valued based upon the
incremental cost to the Company. The incremental cost to the
Company of such benefits did not exceed $50,000 for any named
executive officer for any of the three years. |
|
(4) |
The Companys stock option plans generally provide for
granting of incentive stock options (ISOs) and
non-qualified stock options (NQSOs) (collectively
Stock Options). The option price per share of ISOs
must be equal to the fair market value of a share of Common
Stock on the date granted; the option price of NQSOs may be set
by the Compensation Committee. The exercise period of ISOs may
not be more than ten years from grant, while the period of NQSOs
may be set by the Committee. No Stock Option may be exercised
until six months after the date of grant. The purchase price of
any Stock Option must be paid upon exercise in
(i) immediately available funds, (ii) shares of Common
Stock, (iii) a combination of (i) and (ii), or (iv) by
use of a cashless exercise procedure. |
|
(5) |
All Other Compensation for 2005 includes the
following: (i) contributions to the Companys Profit
Sharing Plan on behalf of each of the Named Executive Officers,
as follows: Mr. Orr, $3,090; Mr. Stodnick, $3,090;
Mr. ONeil, $3,090; and Mr. Myers, $3,090;
(ii) amounts paid by Myers for excess group life insurance,
and other life insurance, as follows: Mr. Orr, $957;
Mr. Stodnick, $642; Mr. ONeil, $327; and
Mr. Myers, $327; (iii) amounts paid or accrued by
Myers for director fees, as follows: Mr. Orr,
$0, and Mr. Myers, $0;
(iv) amounts paid to Mr. Orr as reimbursement for long
term disability premiums, $9,335; and (v) amounts accrued
in 2005 under the Supplemental Executive Retirement Plan for
Years of Service credit awarded to Mr. Orr
($263,268) and to Mr. ONeil ($134,734). |
Supplemental Executive Retirement Plan. The Company has
adopted a Supplemental Executive Retirement Plan (the
SERP) which provides certain pension benefits to a
select group of
16
management employees. In the case of an executive officer of
Myers, the SERP provides an annual supplemental pension benefit
equal to the lesser of (i) $50,000 or (ii) $1,667
multiplied by the participants Years of
Service under the SERP. The annual supplemental pension
benefit is payable for ten years commencing at retirement or
age 65. Credit for Years of Service under the SERP may also
be awarded to a participant at the discretion of the
Compensation Committee of the Board. In 2005, as part of his
employment agreement, Mr. Orr was provided with an annual
SERP benefit equal to $75,000, payable for ten years commencing
at retirement or age 65, as well as Years of
Service credit. In 2005, as part of his employment
agreement, Mr. ONeil was awarded Years of
Service credit under the SERP so that he would be fully
vested at retirement at age 65. A SERP participant with ten
Years of Service under the SERP may receive a reduced annual
supplemental pension benefit commencing at any time after
attainment of age 55. Payments to participants are subject
to restrictions under IRC Section 409A.
Employment Agreements Including Change In Control.
John C. Orr, President and Chief Executive Officer, was
appointed to his current position on May 1, 2005. On
July 22, 2005, the Compensation Committee approved an
amended and restated employment agreement with Mr. Orr,
which agreement was effective as of May 1, 2005 and has a
three year term. The agreement provides a base salary of
$600,000 and certain benefits, with any bonus being fully
discretionary. It also provides that if Mr. Orr is
terminated other than for cause or if he terminates for good
reason, or if there is a change in control, then he is basically
entitled to three years of compensation and benefits. Further,
for change in control situations, he can elect to extend his
agreement for three years, and is provided with IRC
Section 280G protection in the form of an excise tax
gross-up payment.
Mr. Orr is also subject to a three year non-compete
agreement.
Gregory J. Stodnick, Vice President-Finance and Chief Financial
Officer, announced on January 24, 2006 his decision to
retire from these positions effective April 25, 2006. He
entered into a resignation and retirement agreement on
January 24, 2006 which provides that effective
April 25, 2006 that he will be a non-executive employee
until his retirement on June 27, 2007. Until his retirement
he is required to provide the Company with consulting services.
The agreement provides that through December 2006 he will be
paid an annual base salary of $320,000, with a bonus payment of
$145,000 to be paid in March 2006, for fiscal 2005. From
January 1, 2007 until June 27, 2007 he will receive an
annual base salary of $20,000. On June 27, 2007, he will be
paid $145,000 as compensation for a two year non-compete and a
release of claims.
Kevin C. ONeil, Vice President, General Counsel and
Secretary, has an employment agreement dated August 22,
2005 which provides a base salary of $265,000 and certain
benefits, with any bonus being fully discretionary. It also
provides that if Mr. ONeil is terminated other than
for cause or if he terminates for good reason, he is entitled to
one year of compensation and benefits. If there is a change in
control, then he is basically entitled to 18 months of
compensation and benefits. Further, for change in control
situations, he can elect to extend his agreement for
18 months, and is provided with IRC Section 280G
protection in the form of an excise tax
gross-up payment, if
applicable.
Stephen E. Myers is the former Chairman and Chief Executive
Officer of the Company, positions which he resigned effective
May 1, 2005. Mr. Myers entered into a retirement and
separation agreement effective May 1, 2005 with a term
through May 1, 2009. During the term of his agreement, he
is considered a non-executive employee with total compensation
of $500,000 per year, allocated as follows:
(i) compensation for his service as an employee at $60,000;
(ii) compensation for non-compete provisions at $220,000;
and (iii) compensation for releases of claims and other
covenants at $220,000. He is to be granted annually the same
stock based compensation received by a non-employee director of
the Company, which is currently a non-qualified option to
acquire 2,500 shares of the Companys Stock at the
fair market value on the date of grant. The agreement provides
that the Corporate Governance & Nominating Committee
agrees to annually consider Mr. Myers for nomination to the
Board of Directors, and if nominated and elected by the
shareholders to the
17
Board, the Board agrees to appoint him as the Chairman of the
Board of Directors. On May 1, 2009, Mr. Myers will
retire from the Company. The agreement provides that at such
time until he reaches age 75, the Company will reimburse
him for any private supplemental health care coverage that he
obtains, up to a maximum amount of the then-current cost of
COBRA coverage under the Companys health care plan.
Donald A. Merril, Vice President-Business Development, was
employed by Company effective January 24, 2006, and as such
is not included in the Summary Compensation table above. On
January 24, 2006, the Compensation Committee approved an
employment agreement with Mr. Merril. The agreement
indicates that Mr. Merril will be named the Companys
Chief Financial Officer on or before April 25, 2006. It
provides him with a base salary of $300,000 and certain
benefits, with a bonus of $150,000 for fiscal 2006 payable in
2007, with any future bonus being fully discretionary. It also
provides that if Mr. Merril is terminated other than for
cause or if he terminates for good reason, he is entitled to one
year of compensation and benefits. If there is a change in
control, then he is basically entitled to 18 months of
compensation and benefits. Further, for change in control
situations, he can elect to extend his agreement for
18 months, and is provided with IRC Section 280G
protection in the form of an excise tax
gross-up payment, if
applicable. Mr. Merril is subject to a three year
non-compete agreement, except if a Change in Control, and then
for 18 months.
For purposes of Messrs. Orr, ONeil and Merrils
agreements, a Change in Control is defined generally as
acquisition by any person of 20% of the voting power of
outstanding securities, a change in the majority of directors
during a one year period, a merger or consolidation of the
Company where the Company is not the surviving entity, the
complete liquidation of the Company, the sale or disposition of
the Companys manufacturing business, or the sale or
disposition of more than 50% of the Companys assets.
The Companys Code of Regulations provide that the Company
will indemnify, to the full extent then permitted by law, any
officer or former officer of the Company who was or is a party
or is threatened to be made a party to any matter, whether civil
or criminal, by reason of the fact that the individual is or was
an officer of the Company, or serving at the request of the
Company of another entity. The Company has entered into
indemnity agreements with its executive officers contractually
obligating the Company to provide such protection. The Company
also currently has in effect officer and directors insurance
coverage.
Stock Option Grants. The following table contains
information concerning the grant of stock options under the
Stock Plan to the Named Executive Officers. The amounts shown
below as Potential Realizable Values are based on
arbitrarily assumed annualized rates of appreciation required by
the SEC rules. The actual value and gains, if any, on an option
exercise are dependent upon the future performance of the
Companys Common Stock and overall market conditions. There
can be no assurance that the Potential Realizable Values shown
in this table will be achieved.
Option/ SAR Grants in Last Fiscal Year
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Individual Grants | |
|
Potential Realizable |
|
|
| |
|
Value at Assumed |
|
|
Number of | |
|
Percentage of | |
|
|
|
Annual Rates of Stock |
|
|
Securities | |
|
Total Options/SARs | |
|
|
|
Price Appreciation For |
|
|
Underlying | |
|
Granted to | |
|
|
|
Option Term |
|
|
Options/SARs | |
|
Employees in | |
|
Exercise or | |
|
Expiration | |
|
|
Name |
|
Granted(1) | |
|
Fiscal Year | |
|
Base Price | |
|
Date | |
|
5% |
|
10% |
|
|
| |
|
| |
|
| |
|
| |
|
|
|
|
John C. Orr
|
|
|
25,000 |
|
|
|
7.7% |
|
|
$ |
11.15 |
|
|
|
5/31/2015 |
|
|
$175,304 |
|
$444,256 |
Gregory J. Stodnick
|
|
|
17,000 |
|
|
|
5.2 |
|
|
|
11.15 |
|
|
|
5/31/2015 |
|
|
119,207 |
|
302,094 |
Kevin C. ONeil
|
|
|
13,000 |
|
|
|
4.0 |
|
|
|
11.15 |
|
|
|
5/31/2015 |
|
|
91,158 |
|
231,013 |
Stephen E. Myers
|
|
|
2,500 |
|
|
|
.8 |
|
|
|
12.86 |
|
|
|
6/23/2015 |
|
|
20,219 |
|
51,239 |
|
|
(1) |
The 1999 Stock Plan generally provides for granting of incentive
stock options (ISOs) and non-qualified stock options
(NQSOs) (collectively Stock Options).
The option price per share of ISOs must be equal to the fair
market value of |
18
|
|
|
a share of Common Stock on the date
granted; the option price of NQSOs may be set by the
Compensation Committee (Committee). The exercise
period of ISOs may not be more than ten years from grant, while
the period of NQSOs may be set by the Committee. No Stock Option
may be exercised until six months after the date of grant. The
purchase price of any Stock Option must be paid upon exercise in
(i) immediately available funds, (ii) shares of Common
Stock, (iii) a combination of (i) and (ii),
or (iv) by use of a cashless exercise procedure. In the
event a participants employment is terminated due to
death, disability or retirement, ISOs awarded remain exercisable
for the maximum period allowable under the IRC, and NQSOs remain
exercisable for the remainder of the option term or five years,
whichever is less. If a participants employment is
terminated for any reason, all Stock Options granted will be
canceled immediately; provided, however, that if the Company
terminates a participant for reasons other than misconduct or
misfeasance, the participant has 90 days to exercise any
Stock Options; and provided further, that if termination is
attributable to a change in control, any Stock
Options previously granted will continue for their term.
|
Option Exercises and Holdings. The following table
contains information concerning the exercise of stock options
under the Companys stock option plans, and information on
unexercised stock options held as of the end of the fiscal year,
by the Named Executive Officers:
Aggregated Option/ SAR Exercises in Last Fiscal Year
And Fiscal Year-end Option/ SAR Values
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of | |
|
|
|
|
|
|
|
|
Securities | |
|
|
|
|
|
|
|
|
Underlying | |
|
Value of | |
|
|
|
|
|
|
Unexercised | |
|
Unexercised | |
|
|
|
|
|
|
Options/SARs at | |
|
In-the-Money | |
|
|
|
|
|
|
Fiscal Year-End | |
|
Options at Year-End | |
|
|
Shares | |
|
|
|
| |
|
| |
|
|
Acquired | |
|
Value | |
|
Exercisable/ | |
|
Exercisable/ | |
Name |
|
on Exercise | |
|
Realized | |
|
Unexercisable | |
|
Unexercisable(1) | |
|
|
| |
|
| |
|
| |
|
| |
John C. Orr
|
|
|
0 |
|
|
$ |
0 |
|
|
|
6,980/21,320 |
|
|
$ |
30,178/$77,286 |
|
Gregory J. Stodnick
|
|
|
0 |
|
|
|
0 |
|
|
|
14,262/15,800 |
|
|
|
86,159/61,124 |
|
Kevin C. ONeil
|
|
|
0 |
|
|
|
0 |
|
|
|
12,912/13,975 |
|
|
|
56,979/54,796 |
|
Stephen E. Myers
|
|
|
5,225 |
|
|
|
7,411 |
|
|
|
500/6,400 |
|
|
|
860/26,872 |
|
|
|
(1) |
Based upon the closing price reported on the NYSE for the Common
Stock on December 31, 2005. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(A) | |
|
(B) | |
|
(C) | |
|
|
|
|
|
|
Number of Securities | |
|
|
|
|
|
|
Remaining Available for | |
|
|
Number of Securities | |
|
|
|
Future Issuance Under | |
|
|
to be Issued | |
|
Weighted-average | |
|
Equity Compensation | |
|
|
Upon Exercise | |
|
Exercise Price | |
|
Plans (Excluding | |
|
|
of Outstanding Options, | |
|
of Outstanding Options, | |
|
Securities Reflected | |
Plan Category |
|
Warrants or Rights | |
|
Warrants or Rights | |
|
in Column (A)) | |
|
|
| |
|
| |
|
| |
Equity Compensation Plans Approved by Security
Holders(1)
|
|
|
684,636 |
|
|
$ |
9.58 |
|
|
|
1,601,832 |
|
Equity Compensation Plans Not Approved by Security Holders
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
Total
|
|
|
684,636 |
|
|
|
|
|
|
|
1,601,832 |
|
|
|
(1) |
This information is as of January 31, 2006 and includes the
Myers Industries, Inc. 1997 and 1999 Stock Option Plans, as well
as the Myers Industries, Inc. Employee Stock Purchase Plan. |
PROPOSAL NO. 3 RATIFICATION OF
APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Audit Committee appointed KPMG LLP as the Companys
independent registered public accounting firm to audit the
Companys consolidated financial statements for the year
ending December 31, 2005, and has appointed them for the
year ending December 31, 2006. Additional information
regarding the services provided to the Company by KPMG LLP
during 2005 is set forth
19
under the caption entitled Matters Relating to the
Independent Registered Public Accounting Firm, below.
Representatives of KPMG LLP are expected to be present at the
Annual Meeting and will have an opportunity to make a statement
if they wish and to respond to appropriate shareholder questions.
Although shareholder ratification is not required under the laws
of the State of Ohio, the appointment of KPMG LLP is being
submitted to the shareholders for ratification at the Annual
Meeting in order to provide a means by which the shareholders
may communicate their opinion to the Audit Committee. If the
shareholders do not ratify the appointment of KPMG LLP, the
Audit Committee will reconsider the appointment, but is not
obligated to change the appointment, and may for other reasons,
be unable to make another appointment.
The Board of Directors Recommends That You Vote
For Proposal 3
Relating to the Ratification of the Appointment of KPMG
LLP
Matters Relating to the Independent Registered Public
Accounting Firm
The firm of KPMG LLP audited the books and records of the
Company for the year ended December 31, 2005. The firm of
Ernst &Young LLP audited the books and records of the
Company for the years ended December 31, 2004 and 2003.
Representatives of KPMG LLP are expected to be available at
the meeting to respond to appropriate questions and will be
given the opportunity to make a statement if they desire to do
so.
A description of the fees billed to the Company by KPMG LLP
for the year ended December 31, 2005 is set forth in the
table below. A description of the fees billed to the Company by
Ernst & Young LLP for the year ended December 31,
2004 is set forth below under Change of Independent
Registered Public Accounting Firm June 2005.
KPMG LLP was retained by the Audit Committee in 2005. The Audit
Committee (see, Report of Audit Committee) reviewed
the non-audit services provided by KPMG LLP during the year
ended December 31, 2005, and determined that the provision
of such non-audit services was compatible with maintaining the
accountants independence.
|
|
|
|
|
|
|
2005 | |
|
|
| |
Audit
Fees(1)
|
|
$ |
1,565,000 |
|
Audit Related
Fees(2)
|
|
|
-0- |
|
Tax
Fees(3)
|
|
|
56,500 |
|
Other
Fees(4)
|
|
|
-0- |
|
|
|
(1) |
Professional fees for the audit of the annual financial
statements and the review of the quarterly financial statements. |
|
(2) |
Fees for assurance and related services reasonably related to
audits and reviews of benefit plans. |
|
(3) |
Professional fees for tax compliance, tax advice, and tax
planning. |
|
(4) |
Fees for all other products and services. |
The Audit Committees Pre-Approval Policy requires the
pre-approval of all audit and permissible non-audit services
provided by the independent registered public accounting firm.
These services may include audit services, audit-related
services, tax services and other services. Pre-approval is
provided for up to one year and any pre-approval is detailed as
to the particular service or category of services and is
generally subject to a specific range or budget. The independent
registered public accounting firm and management are required to
periodically report to the Audit Committee regarding the extent
of services provided by the independent registered public
accounting firm in accordance with this Policy, and the fees for
the services performed to date. During 2005, all services were
pre-approved by the Audit Committee in accordance with the
policy. The Pre-Approval Policy is available on the
Companys website.
20
Change of Independent Registered Public Accounting
Firm June 2005
The Audit Committee of the Board of Directors selects the
Companys independent registered public accounting firm.
Effective on May 13, 2005, the Audit Committee appointed
KPMG LLP as the Companys independent registered
public accounting firm. On June 9, 2005, KPMG LLP
accepted the engagement, after completing its due diligence.
During the years ended December 31, 2004 and 2003 and
through June 9, 2005, the Company, nor anyone acting on its
behalf, consulted KPMG LLP with respect to the application
of accounting principles to a specified transaction, either
completed or proposed, or the type of audit opinion that might
be rendered on the Companys financial statements, or any
other matters or reportable events listed in
Items 304(a)(2)(i) and (ii) of
Regulation S-K.
On May 10, 2005, upon the filing of the Companys
Form 10-Q for the
quarter ended March 31, 2005, E&Y completed all of its
work for the Company and was no longer the Companys
independent registered public accounting firm. Prior to the
Company filing the
Form 10-Q for the
quarter ended March 31, 2005, E&Y performed a review of
the Companys financial results for the quarter ended
March 31, 2005 in accordance with the provisions of
SAS 100 (AU 722), Interim Financial Information.
On March 11, 2005, the Audit Committee determined that it
would request proposals from independent registered public
accounting firms for the Companys 2005 audit. E&Y, the
Companys then independent registered public accounting
firm for the year ended December 31, 2004, received a
request for proposal, but notified the Company on April 13,
2005, that they declined to stand for reappointment as the
Companys independent registered public accounting firm.
As disclosed in the Companys
Form 10-K/ A filed
on May 2, 2005, management concluded that the
Companys disclosure controls and procedures were not
effective as of December 31, 2004 due to material
weaknesses identified in the business segment reporting process,
the financial statement close process and the income tax
process. E&Y issued an adverse opinion on the effectiveness
of internal controls over financial reporting because of these
material weaknesses as of December 31, 2004.
E&Ys reports on the Companys consolidated
financial statements for the years ended December 31, 2004
and 2003 did not contain an adverse opinion or a disclaimer of
opinion and were not qualified or modified as to uncertainty,
audit scope or accounting principles. In connection with the
audits of the Companys financial statements for each of
the two years ended December 31, 2004 and 2003 and through
June 9, 2005, there were no disagreements with E&Y on
any matters of accounting principles or practices, financial
statement disclosure or auditing scope and procedures which, if
not resolved to the satisfaction of E&Y would have caused
E&Y to make reference to the matter in their report.
During the year ended December 31, 2004, and the quarter
ended March 31, 2005, aggregate fees billed by E&Y were
approximately $1,796,900 for work related to the audit of the
Companys financial statements for the year ended
December 31, 2004, including reviews of quarterly unaudited
financial statements and statutory audits of subsidiaries, their
opinion on the effectiveness of internal controls over financial
reporting, as well as for the review of the quarter ended
March 31, 2005. In addition, the Company paid approximately
$218,539 for other services provided by E&Y, related
principally to tax compliance, employee benefit plan audits,
acquisitions and related due diligence, and general accounting
research. There were no fees billed to the Company by E&Y
during this period for financial information systems design and
implementation.
21
Performance Graph.
Set forth below is a line graph comparing the yearly percentage
change in the cumulative total shareholder return on Myers
Common Stock against the cumulative return of the
S&P 500 Index and the S&P SmallCap 600 Index
for the period of five years commencing December 31, 2000
and ended December 31,
2005.(1)
Comparison of 5 Year Cumulative Total Return
Assumes Initial Investment of $100
December 2005
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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2000 | |
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2001 | |
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2002 | |
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2003 | |
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2004 | |
|
2005 | |
Myers Industries
|
|
$ |
100.00 |
|
|
$ |
104.48 |
|
|
$ |
103.64 |
|
|
$ |
119.11 |
|
|
$ |
140.02 |
|
|
$ |
161.23 |
|
S&P 500
|
|
$ |
100.00 |
|
|
$ |
88.12 |
|
|
$ |
68.64 |
|
|
$ |
88.32 |
|
|
$ |
97.92 |
|
|
$ |
100.86 |
|
S&P SmallCap 600
|
|
$ |
100.00 |
|
|
$ |
106.54 |
|
|
$ |
90.95 |
|
|
$ |
126.24 |
|
|
$ |
154.84 |
|
|
$ |
166.73 |
|
|
|
(1) |
Assumes that the value of the investment in Myers Common Stock,
the S&P 500 and the S&P SmallCap 600 was $100
on December 31, 2000 and that all dividends were
reinvested. The Company is a member of the S&P SmallCap
600 Index. The S&P SmallCap 600 Index consists of
600 domestic stocks chosen for market size, liquidity,
(bid-asked spread, ownership, share turnover and number of no
trade days) and industry group representation. It is a
market-value weighted index (stock price times the number of
shares outstanding), with each stocks weight in the Index
proportionate to its market value. |
Security Ownership of Certain Beneficial Owners and
Management.
The following table shows the number of shares of our common
stock beneficially owned as of February 14, 2006(unless
otherwise indicated) by:
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each person, who, to our knowledge, beneficially owns more than
5% of our common stock; |
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each of the Companys Directors; |
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the Chief Executive Officer and the other Named Executive
Officers; and |
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all individuals who served as Directors or Named Executive
Officers, as a group. |
A beneficial owner of stock is a person who has sole or shared
voting power, meaning the power to control voting decisions, or
sole or shared investment power, meaning the power to cause the
22
sale of the stock. All individuals listed in the table have sole
voting and investment power over the shares unless otherwise
noted. The Company had no preferred stock issued or outstanding.
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Shares | |
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Percent of | |
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Beneficially | |
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Shares | |
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Owned | |
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Outstanding(1) | |
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| |
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| |
Greater Than 5%
Owners(2,3)
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Mary S. Myers
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|
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5,313,967 |
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|
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15.3 |
% |
Stephen E.
Myers(4)
|
|
|
2,652,720 |
|
|
|
7.7 |
% |
Dimensional Fund Advisors, Inc.
|
|
|
2,514,302 |
|
|
|
7.2 |
% |
1299 Ocean Avenue, 11th Floor
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|
|
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|
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Santa Monica, CA 90401
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|
|
|
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|
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Fidelity Management & Research Company
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|
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2,714,154 |
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7.8 |
% |
82 Devonshire Street
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Boston, Massachusetts 02109
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Directors and Named Executive
Officers(2,5,6)
|
|
|
|
|
|
|
|
|
Keith A. Brown
|
|
|
79,478 |
|
|
|
|
|
Karl S. Hay
|
|
|
18,316 |
|
|
|
|
|
Richard P. Johnston
|
|
|
12,043 |
|
|
|
|
|
Edward W. Kissel
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|
|
9,726 |
|
|
|
|
|
Stephen E.
Myers(4)
|
|
|
2,652,720 |
|
|
|
7.7 |
% |
John C. Orr
|
|
|
58,751 |
|
|
|
|
|
Richard L. Osborne
|
|
|
21,967 |
|
|
|
|
|
Jon H. Outcalt
|
|
|
36,721 |
|
|
|
|
|
Gregory J. Stodnick
|
|
|
53,294 |
|
|
|
|
|
Kevin C. ONeil
|
|
|
16,712 |
|
|
|
|
|
All Directors and Named Executive Officers as a group
(10 persons)
|
|
|
2,959,728 |
|
|
|
8.5 |
% |
|
|
(1) |
Number of shares of Common Stock beneficially owned is reported
as of February 14, 2006. Unless otherwise indicated, none
of the persons listed beneficially owns one percent or more of
the outstanding shares of Common Stock. |
|
(2) |
Unless otherwise noted, the beneficial owner uses the same
address as the address of the principal office of the Company. |
|
(3) |
According to filings made with the SEC, this party or an
affiliate has dispositive and/or voting power over the shares. |
|
(4) |
Includes 13,394 shares of Common Stock held by
Mr. Myers spouse, for which Mr. Myers disclaims
beneficial ownership. |
|
(5) |
Includes shares which the non-employee director has a right to
acquire by exercising options granted under the 1992 and 1999
Plan. |
|
(6) |
The amounts shown represent the total shares of Common Stock
owned by such individuals, together with shares which are
issuable under currently exercisable stock options:
Mr. Orr, 6,980; Mr. Stodnick, 14,262;
Mr. ONeil, 12,912; and Mr. Myers, 500. |
Section 16(a) Beneficial Ownership Reporting
Compliance. Section 16(a) of the Securities Exchange
Act of 1934 (1934 Act) requires Myers
Directors, officers and persons who own more than ten percent of
its Common Stock (Section 16 Filers) to file
reports of ownership and changes in ownership with the SEC and
to furnish Myers with copies of all such forms they file. These
reports can be viewed at the Companys website at
http://www.myersind.com/section16 reports.html, or at the
SECs website at http://www.sec.gov. Myers
understands from the information provided to it by the
Section 16 Filers for 2005 that they have adhered to all
filing requirements applicable to the Section 16 Filers,
with the exception of Mr. Johnston. Due to an
administrative error, the results of two sales of Common Stock
by Mr. Johnston were reported on a Form 4 filed six
business days late.
23
Shareholder Proposal for Inclusion in Proxy Statement.
Any proposals to be considered for inclusion in the proxy
statement to be provided to shareholders of Myers for its next
Annual Meeting to be held in April 2007 may be made only by a
qualified shareholder and must be received by Myers no later
than November 20, 2006.
The enclosed proxy card grants the proxy holders discretionary
authority to vote on any matter raised at the Annual Meeting. If
a shareholder intends to submit a proposal at the Companys
2007 Annual Meeting of Shareholders which is not eligible for
inclusion in the Proxy Statement relating to the meeting, and
the shareholder fails to give the Company notice in accordance
with the requirements set forth in the 1934 Act no later
than February 1, 2007, then the proxy holders will be
allowed to use their discretionary authority if a proposal is
properly raised at the Companys Annual Meeting in 2007.
The submission of such a notice does not ensure that a proposal
can be raised at the Companys Annual Meeting.
No Incorporation by Reference. The Compensation Committee
Report, the Audit Committee Report (including reference to the
independence of the Audit Committee members), and the stock
price Performance Graph, are not deemed filed with the SEC or
subject to the liabilities of Section 18 of the
1934 Act, and shall not be deemed incorporated by reference
into any prior or future filings made by the Company under the
1933 Act, or the 1934 Act, except to the extent that
the Company specifically incorporates such information by
reference.
Cost of Proxy Solicitation. The accompanying proxy is
solicited by and on behalf of the Board of Directors of Myers,
whose notice of meeting is attached to this Proxy Statement, and
the entire cost of such solicitation will be borne by Myers. In
addition to the use of the mails, proxies may be solicited by
personal interview, telephone and telegram by directors,
officers and employees of Myers. Arrangements will be made with
brokerage houses and other custodians, nominees and fiduciaries
for the forwarding of solicitation material to the beneficial
owners of stock held of record by such persons, and Myers will
reimburse them for reasonable
out-of-pocket expenses
incurred by them in connection therewith.
Copy of the
Form 10-K. The
Company will mail without charge, upon written request, a copy
of the Companys Annual report on
Form 10-K for the
year ended December 31, 2005, including the consolidated
financial statements, schedules and list of exhibits, and any
particular exhibit specifically requested. Requests should be
sent to: Myers Industries, Inc., 1293 South Main Street, Akron,
Ohio 44301, Attn: Investor Relations. The Annual Report on
Form 10-K is also
available at http://www.myersind.com and at the
SECs website at http://www.sec.gov.
Notice Regarding Delivery of Security Holder Documents.
The SEC now permits companies to send a single set of annual
disclosure documents to any household at which two or more
stockholders reside, unless contrary instructions have been
received, but only if the company provides advance notice and
follows certain procedures. In such cases, such stockholders
continue to receive a separate notice of the meeting and proxy
card. This householding process reduces the volume
of duplicate information and reduces printing and mailing
expenses. The Company has not instituted householding for
shareholders of record; however, a number of brokerage firms may
have instituted householding for beneficial owners of the
Companys shares of Common Stock held through such
brokerage firms. If your family has multiple accounts holding
shares of Common Stock of the Company, you already may have
received householding notification from your broker. Please
contact your broker directly if you have any questions or
require additional copies of the annual disclosure documents.
The broker will arrange for delivery of a separate copy of this
Proxy Statement or the Companys Annual Report promptly
upon your written or oral request. You may decide at any time to
revoke your decision to household, and thereby receive multiple
copies.
24
PROXY
|
|
MYERS INDUSTRIES, INC. |
SOLICITED BY THE BOARD OF DIRECTORS |
GREGORY J. STODNICK, KEVIN C. ONEIL, or
either of them, with full power of substitution, are hereby
authorized to represent the undersigned and to vote all Common
Stock of the undersigned in MYERS INDUSTRIES, INC.
(Company) at the Annual Meeting of Shareholders of
said Company to be held on April 25, 2006, and any
adjournment(s) thereof with respect to the following matters:
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|
1. |
To elect the following nine Directors:
|
Keith A. Brown, Vincent C. Byrd, Karl S. Hay,
Richard P. Johnston, Edward W. Kissel,
Stephen E. Myers, John C. Orr, Richard L.
Osborne, and Jon H. Outcalt
|
|
|
o For All
Nominees o Withhold
Authority |
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o For All
Except:
|
(Instruction: To withhold authority to vote for
any individual nominee write that nominees name on the
line above.)
|
|
2. |
To approve amendments to the Companys 1999
Stock Plan.
|
o For o Against o Abstain
(Continued and to be signed on reverse
side)
(Continued from other side)
|
|
3. |
To ratify the appointment of KPMG LLP as the
Companys independent registered public accounting firm for
fiscal 2006.
|
o For o Against o Abstain
|
|
4. |
Such other business as may properly may come
before the meeting or any adjournments thereof, all in
accordance with the notice of this meeting and the accompanying
proxy statement, receipt of which is acknowledged.
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|
THIS PROXY WILL BE VOTED FOR THE DIRECTORS
NOMINATED AND FOR THE APPROVAL OF ITEMS 2 AND 3, UNLESS A
CONTRARY VOTE IS INDICATED, IN WHICH CASE THE PROXY WILL BE
VOTED AS DIRECTED.
|
Please sign exactly as indicated, date, and
return promptly in the enclosed envelope.