☒
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No fee required.
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☐
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Fee paid previously with preliminary materials.
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☐
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Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and
0-11.
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•
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Elect four Class 2 directors to the Board of Directors to serve until the 2027
annual meeting;
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•
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Ratify the appointment of RSM US LLP as our independent registered public
accounting firm for the fiscal year ending December 31, 2024;
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•
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Provide advisory approval on the compensation of our named executive officers
(“Say-on-Pay”); and
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•
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Transact such other business as may properly come before the Annual Meeting.
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| | | |
Notice of Annual Meeting of SHAREHOLDERS
for Balchem Corporation
|
| |
![]() |
DATE AND TIME:
|
| |
Thursday, June 20, 2024, 9:00 a.m., Eastern Daylight Time (“EDT”)
|
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|
||||||
PLACE:
|
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Online, at www.virtualshareholdermeeting.com/BCPC2024
|
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|
||||||
|
||||||
ITEMS OF
BUSINESS:
|
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1.
|
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Election of four Class 2 director nominees to the Board of Directors of Balchem
Corporation (“Balchem” or the “Company”) to serve until the 2027 Annual Meeting of Shareholders and until their successors are duly elected and qualified;
|
|
2.
|
| |
Ratification of the appointment of RSM US LLP (“RSM”)
as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2024;
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3.
|
| |
Advisory approval of the compensation of the Company’s named executive officers (“Say-on-Pay”); and
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||
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4.
|
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To transact such other business as may properly come before the 2024 Annual
Meeting of Shareholders (the “Annual Meeting”) or any postponement or adjournment thereof.
|
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|
||||||
WHO CAN VOTE:
|
| |
Shareholders of record at the close of business on April 22, 2024.
|
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|
||||||
|
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HOW TO VOTE:
|
| |
Shareholders who receive a printed copy of this Proxy Statement and who do not
expect to attend the Meeting are requested to complete, date and sign the enclosed Proxy Card and promptly return the same in the stamped, self-addressed envelope enclosed for your convenience. Shareholders may also submit a Proxy Card
over the Internet, at www.proxyvote.com, or by phone. You will need to input the 16-digit control number located on the Proxy Card or Notice of Internet Availability of Proxy Materials if you are submitting a Proxy Card over the Internet
or by phone
|
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|
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If you hold your shares through a broker, bank or other nominee, please follow the
instructions on the voting instruction form that you should receive from your broker, bank or other nominee.
|
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|
||||||
|
||||||
2023 ANNUAL REPORT AND DATE OF DISTRIBUTION:
|
| |
For more complete information, please review the Annual Report to Shareholders and
the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (the “Annual Report”), a copy of which accompanies this Notice of Annual Meeting of Shareholders and Proxy
Statement. This Notice of Annual Meeting of Shareholders and Proxy Statement and the Annual Report are first being made available or mailed to shareholders on or about April 26, 2024.
|
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By order of the Board of Directors,
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Hatsuki Miyata
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April 26, 2024
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General Counsel and Secretary
|
|
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Proposal
|
| |
Recommendation
|
| |
Voting Standard*
|
| |
Page
|
| |||
|
1
|
| |
The election of four Class 2 director nominees to the Board of Directors to serve until the Annual
Meeting of Shareholders in 2027 and until their successors are duly elected and qualified.
|
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FOR
each nominee
|
| |
Majority present
and entitled to
vote.
|
| | | |
|
2
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The ratification of the appointment of RSM US LLP as our independent registered public accounting
firm for the fiscal year ending December 31, 2024.
|
| |
FOR
|
| |
Majority present
and entitled to
vote.
|
| | | |
|
3
|
| |
Advisory approval of the compensation of the Company’s named executive officers
|
| |
FOR
|
| |
Majority present
and entitled to
vote.
|
| | |
*
|
For all proposals, you have the choice to vote “FOR”, “AGAINST” or “ABSTAIN.”
|
|
![]() By Internet:
|
| |
![]() By Phone:
|
| |
![]() By Mail:
|
|
|
www.proxyvote.com
|
| |
1-800-690-6903
(toll free within
U.S. and Canada)
|
| |
Vote Processing
c/o Broadridge
51 Mercedes Way
Edgewood, NY 11717
|
|
•
|
sending a written statement revoking your proxy to the Secretary of the Company,
provided such statement is received no later than 11:59 p.m., EDT on June 19, 2024;
|
•
|
voting again via the Internet or by telephone at a later time before the closing of
those voting facilities at 11:59 p.m., EDT on June 19, 2024;
|
•
|
submitting a properly signed proxy card with a later date that is received no later
than 11:59 p.m., EDT on June 19, 2024; or
|
•
|
attending the Annual Meeting (virtually) and voting at the Annual Meeting.
|
|
Name
|
| |
Class
|
| |
Next Election Date*
|
|
|
Kathleen Fish
|
| |
1
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2025
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Theodore Harris
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1
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2025
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Matthew Wineinger
|
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1
|
| |
2025
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Daniel Knutson
|
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2
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2027
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Joyce Lee
|
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2
|
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2027
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Olivier Rigaud
|
| |
2
|
| |
2027
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|
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Monica Vicente
|
| |
2
|
| |
2027
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David Fischer
|
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3
|
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2026
|
|
*
|
Subject to the Company's Director Retirement Policy.
|
|
Daniel Knutson
Class 2 Director
(Term expires 2024)
Age: 67
Independent Director since 2018
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Professional Highlights
|
|
|
•
Mr. Knutson served as the Executive Vice President for Special Projects at Land O’Lakes, Inc., an agribusiness and food co-operative, until his retirement at the end of 2017.
|
| ||
|
• From
2000 to 2017, Mr. Knutson served as Executive Vice President and Chief Financial Officer at Land O’Lakes, where he oversaw corporate finance, accounting, treasury, audit, information technology and strategy and played key roles in many
of Land O’Lakes’ transactions. In addition, he was responsible for Land O’Lakes’ investment in Moark LLC.
|
| ||
|
Committee Assignments
|
| ||
|
• Audit, Chair
|
| ||
|
• Compensation
|
| ||
|
Other Current Public Company Directorships
|
| ||
|
• None
|
| ||
|
Nominee Qualifications
|
| ||
|
Our Company’s financial compliance programs and policies benefit from
Mr. Knutson’s input and skilled guidance. Mr. Knutson’s animal feed and human food industry experience, combined with his financial and international business management experience, makes him a valuable member of our Board. Mr. Knutson
has served as Chair of our Audit Committee since June 2018.
|
|
|
Joyce Lee
Class 2 Director
(Term expires 2024)
Age: 51
Independent Director since 2019
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Professional Highlights
|
|
|
•
President of Cobb-Vantress, Inc., a wholly owned subsidiary of Tyson Foods, Inc. (NYSE: TSN) since January 2022. Cobb-Vantress, Inc. is the world’s oldest pedigree broiler breeding company, dedicated to genetic research and innovation.
|
| ||
|
• From
2020 to 2021, Ms. Lee served as Executive Vice President and President of U.S. Pet Health and U.S. Commercial Operations of Elanco Animal Health Incorporated (NYSE: ELAN).
|
| ||
|
• From
2016 to 2020, Ms. Lee served as the president of North America for Bayer Animal Health.
|
| ||
|
• From
2013 to 2015, Ms. Lee was Executive Vice President and Area President of Canada and Latin America at Zoetis Inc. (NYSE: ZTS).
|
| ||
|
Committee Assignments
|
| ||
|
• Audit
|
| ||
|
• Governance
|
| ||
|
Other Current Public Company Directorships
|
| ||
|
• None
|
| ||
|
Nominee Qualifications
|
| ||
|
Ms. Lee’s domestic and international business management experience,
particularly with respect to the development and supply of products to the animal feed and nutrition industries, makes her a valuable member of our Board.
|
|
|
Olivier Rigaud
Class 2 Director
(Term expires 2024)
Age: 59
Independent Director since 2023
![]() |
|
Professional Highlights
|
|
|
•
Mr. Rigaud has been Chief Executive Officer and Chair of the Board of Management for Corbion N.V., a global food and biochemicals company based in the Netherlands, since August 2019. He also serves as a member of the Executive Committee
at Corbion N.V.
|
| ||
|
• Chief
Executive Officer of Naturex, a global specialty ingredients company for the food & beverage, nutrition & health, and personal care industries. Prior to joining Corbion N.V., Mr. Rigaud successfully finalized the sale of Naturex
to Givaudan.
|
| ||
|
Committee Assignments
|
| ||
|
• Audit
|
| ||
|
• Governance
|
| ||
|
Other Current Public Company Directorships
|
| ||
|
• Corbion N.V. (Euronext Amsterdam)
|
| ||
|
Board Qualifications
|
| ||
|
Mr. Rigaud brings over thirty years of relevant industry expertise and strong
global business acumen, including extensive M&A and strategic experience, to our Board. He is also well-versed on sustainability and corporate social responsibility matters. As CEO at Corbion N.V., he leads an organization of
2,500 employees, 16 industrial sites, and 6 R&D and Innovation centers. Mr. Rigaud is a French national working out of the Netherlands, and brings unique and diverse international perspective, relevant CEO experience, and insights to
our Board.
|
|
|
Monica Vicente
Class 2 Director
(Term expires 2024)
Age: 58
Independent Director since 2023
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|
Professional Highlights
|
|
|
• Senior
Vice President and Chief Financial Officer of Fresh Del Monte Produce Inc., a global agricultural company, since April 2022.
|
| ||
|
• Prior
to that, she served as Vice President, Corporate Finance at Fresh Del Monte for 19 years.
|
| ||
|
Committee Assignments
|
| ||
|
• Audit
|
| ||
|
Other Current Public Company Directorships
|
| ||
|
• None
|
| ||
|
Board Qualifications
|
| ||
|
Ms. Vicente’s experience as a current CFO for a global public company brings
substantial financial expertise to our Board. She has extensive financial expertise across global and regional finance, financial planning and analysis, investor relations and procurement for a global public company. She has experience in
SEC reporting and controlling, tax and treasury as well. Ms. Vicente brings these relevant experiences, strategic business acumen, and relevant food industry expertise to our Board.
|
|
|
David Fischer,
Class 3 Director
(Term expires 2026)
Age: 61
Independent Director since 2010
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|
Professional Highlights
|
|
|
• Retired
director and President and Chief Executive Officer of Greif, Inc. (NYSE), a supplier of industrial packing systems from November 2011 to October 2015. President and Chief Operating Officer of Greif from 2007 to 2011, and from 2004 to
2007, Senior Vice President and Divisional President, Industrial Packaging & Services - Americas.
|
| ||
|
• A
co-founder and chairman of the board of directors of 10x Engineered Materials, a manufacturer of high-tech abrasives for industrial applications.
|
| ||
|
Committee Assignments
|
| ||
|
• Executive
|
| ||
|
• Compensation
|
| ||
|
• Governance
|
| ||
|
Other Current Public Company Directorships
|
| ||
|
• Ingredion Incorporated (NYSE)
|
| ||
|
Board Qualifications
|
| ||
|
Mr. Fischer’s management and leadership skills, developed over years of
responsibility for complex, global manufacturing operations, and his intimate knowledge of mergers and acquisitions, position him as a critical component of our Board as we look to grow both organically and by acquisition.
|
|
|
Kathleen Fish,
Class 1 Director
(Term expires 2025)
Age: 67
Independent Director since 2022
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|
Professional Highlights
|
|
|
• Prior
to her retirement, Ms. Fish was Chief Research, Development and Innovation Officer for The Procter & Gamble Company (NYSE: PG) (“P&G”) (NYSE) (2017 – 2020).
|
| ||
|
• Chief Technology Officer, P&G (2014 – 2017)
|
| ||
|
Committee Assignments
|
| ||
|
• Executive
|
| ||
|
• Compensation
|
| ||
|
• Governance, Chair
|
| ||
|
Other Current Public Company Directorships
|
| ||
|
• Origin Materials, Inc. (Nasdaq)
|
| ||
|
Board Qualifications
|
| ||
|
Ms. Fish’s executive leadership skills along with her expertise in the field of
innovation, research, and new product development, including in highly regulated industries and direct to consumer markets provide valuable insights to the Board in driving growth and overseeing governance and risk. Ms. Fish has served as
Chair of our Governance Committee since February 2023.
|
|
|
Ted Harris,
Class 1 Director,
Chairman of the Board (Term
expires 2025)
Age: 59
Director since 2015, Chairman since 2017
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|
Professional Highlights
|
|
|
•
Director, Chief Executive Officer and President of Balchem Corporation since April 2015, and Chairman of the Board of Directors since January 2017.
|
| ||
|
• Prior
to joining the Company, Mr. Harris was employed by Ashland Global Holdings Inc. (formerly Ashland Inc.) (NYSE), a specialty chemical company. During his tenure at Ashland, his management positions included Senior Vice President/Ashland,
President, Performance Materials, from November of 2014 to April 2015, Senior Vice President/Ashland, President, Performance Materials & Ashland Supply Chain from 2011 to 2014, and Vice President/Ashland, President, Performance
Materials & Ashland Supply Chain.
|
| ||
|
Other Current Public Company Directorships
|
| ||
|
• Pentair plc (NYSE)
|
| ||
|
Board Qualifications
|
| ||
|
Mr. Harris has led the Company since April 2015, effectively using his extensive
knowledge and deep understanding of the Company’s global business, operations, people and strategic priorities to lead the Company in achieving its vision of “making the world a healthier place.” Mr. Harris’ broad managerial,
international, operational and sales experience, as well as his proven track record of developing and implementing strategies for delivering sustainable, profitable growth, make him a valuable member and Chairman of our Board.
|
|
|
Matthew Wineinger,
Class 1 Director and Lead
Director
(Term expires 2025)
Age: 57
Independent Director since 2015
![]() |
|
Professional Highlights
|
|
|
• Since
June 2015, Mr. Wineinger has been the President and Chief Executive Officer of United Sugars Producers and Refiners Cooperative (formerly, United Sugars Corporation until October 2023), a privately held, leading marketer of sugar.
|
| ||
|
•
President, Bulk Ingredients of Tate & Lyle PLC (LSE) from June 2010 to November 2014 and prior to that, President, Food and Industrial Ingredients from March 2008 to June 2010.
|
| ||
|
Committee Assignments
|
| ||
|
• Executive, Chair
|
| ||
|
• Compensation, Chair
|
| ||
|
Other Current Public Company Directorships
|
| ||
|
• None
|
| ||
|
Board Qualifications
|
| ||
|
Mr. Wineinger’s over thirty years of extensive global, operational and strategic
industry experience, together with his previous knowledge of manufacturing operations involving many of the Company’s current raw materials, make him a valuable member of our Board, particularly as the Company focuses on development and
supply of products to human nutrition markets. Mr. Wineinger has served as Lead Director and Chair of our Compensation Committee and Executive Committee since February 2023.
|
|
|
Knowledge Skills and Experience
|
| |
Fischer
|
| |
Fish
|
| |
Harris
|
| |
Knutson
|
| |
Lee
|
| |
Rigaud
|
| |
Vicente
|
| |
Wineinger
|
|
|
Core Industry Experience based
on experience at other companies in similar industries
|
| |
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|
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Executive Experience based on
current or prior role(s)
|
| |
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|
|
Corporate Governance based on
current or prior role(s)
|
| |
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| | | | | |
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| ||||
|
Public Company Board Experience
based on current or prior service on other public boards
|
| |
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|
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|
|
Environmental/Social based on
current or prior role(s)
|
| |
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| | | | | |
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| | | |
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|
Financial / Accounting / Risk Management / Capital Markets based on experience gained as a CFO, accounting professional or risk management professional
|
| |
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|
|
Health & Safety based on
current or prior role(s)
|
| |
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| | | |
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| | | |
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| ||
|
Mergers & Acquisitions / Strategy experience and knowledge in evaluating and implementing M&A transactions and business/investment strategies
|
| |
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|
|
Knowledge Skills and Experience
|
| |
Fischer
|
| |
Fish
|
| |
Harris
|
| |
Knutson
|
| |
Lee
|
| |
Rigaud
|
| |
Vicente
|
| |
Wineinger
|
|
|
Research & Development
based on current or prior role(s)
|
| |
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|
International Markets business
experience outside the United States
|
| |
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|
|
Marketing and Sales experience
in understanding, assessing, developing and implementing marketing and sales strategies
|
| |
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|
Manufacturing / Supply Chain
based on current or prior role(s)
|
| |
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|
Compensation / HR experience
based on HR expertise or CEO/head of business role with people management responsibilities or member of Compensation Committee at a public board
|
| |
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|
|
Board Diversity Matrix
|
| |||||||||||||||
|
Total Number of Directors
|
| |
8
|
|
|
Gender
|
| |
Male or Man
|
| |
Female or
Woman
|
| |
Non-Binary
(not female/
woman or male/man)
|
| |
Other –
A gender
not listed
|
| |
Unknown /
I choose not
to disclose
|
|
| | |
5
|
| |
3
|
| | | | | | |
|
Number of Directors who identify in any of the categories below
|
| |||||||||||||||
|
Hispanic or Latino
|
| | | |
1
|
| | | | | | | ||||
|
American Indian or Alaskan Native
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
Asian
|
| | | |
1
|
| | | | | | | ||||
|
Black or African American
|
| |
|
| |
|
| |
|
| |
|
| |||
|
Native Hawaiian or Other Pacific Islander
|
| | | | | | | | | | | |||||
|
White
|
| |
5
|
| |
1
|
| |
|
| |
|
| |
|
|
|
Two or More Races
|
| | | | | | | | | | | |||||
|
LGBTQ+
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
•
|
Balchem’s Governance Guidelines:
|
○
|
Include corporate governance practices to guide and assist the Board in fulfilling
its responsibilities to oversee management in the operation and results of Balchem’s business and affairs.
|
○
|
Are designed to enhance the necessary authority and practices for the Board to make
decisions that are in the best interests of Balchem and independent of Balchem’s management.
|
○
|
Are intended to align the interests of directors and management with the long-term
interests of Balchem’s shareholders.
|
○
|
The Governance Guidelines are available on the Leadership & Governance page in
the Investor Relations section of the Company’s website, www.balchem.com.
|
•
|
Code of Business Conduct and Ethics
(our “Code of Conduct”)
|
○
|
Our Code of Conduct applies to all Balchem employees, directors and officers.
|
○
|
Our Code of Conduct is the foundation of Balchem’s Compliance and Ethics Program and
embodies the first of Balchem’s Core Values, which is “Always Doing the Right Thing.”
|
○
|
Our Code of Conduct promotes honest and ethical conduct, compliance with applicable
laws, rules and regulations, prompt reporting of violations of the code and full, fair, accurate, timely and understandable disclosure in reports filed with the SEC.
|
○
|
Our Code of Conduct meets the requirements of a “code of ethics” as defined by
Item 406 of Regulation S-K. The Code of Conduct covers topics including, but not limited to, avoiding conflicts of interest, maintaining confidentiality of information, working with suppliers, preventing bribery and corruption, avoiding
insider trading, and compliance with laws and regulations.
|
○
|
Additionally, the Company has adopted a Code of Conduct for Senior Financial Officers
that applies to the Company’s Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer, Treasurer and Corporate Controller.
|
○
|
Among other things, this code requires Senior Financial Officers to provide full,
fair, accurate, timely, and understandable disclosure in reports and documents that the Corporation files with or submits to the Securities and Exchange Commission and in other public communications.
|
○
|
Amendments to, or waivers of the provisions of, the Code of Conduct, if any, made
with respect to any of our directors or officers will be posted on our website at www.balchem.com.
|
○
|
Both codes are available on the Leadership & Governance page in the Investor
Relations section of the Company’s website at www.balchem.com.
|
○
|
We also have a Supplier Code of Conduct which our suppliers are expected to adhere
to. The Supplier Code of Conduct defines our commitment to protecting human rights and ensuring safe work environments throughout our supplier chain.
|
•
|
Board Committee Charters
|
○
|
Balchem’s Board Committees (Audit, Compensation and Governance) have each adopted a
charter defining its respective purposes and responsibilities. These charters are reviewed by the Committees annually. The charters for the Audit, Compensation and Governance Committees are available on the Leadership & Governance
page in the Investor Relations section of the Company’s website, www.balchem.com.
|
•
|
Director Independence
|
○
|
Each year, the Board conducts a survey to determine the independence of its members.
The Board has determined that each of the Company’s directors, other than Mr. Harris, is independent, as defined under the Nasdaq Listing Rules.
|
•
|
Evaluations
|
○
|
The Board conducts an annual self-evaluation (which includes a director
self-assessment) and the Committees conduct a self-evaluation on a biennial basis.
|
(1)
|
The Audit Committee receives, or arranges for the Board to receive, on a no less than annual basis, reports from management on
areas of material risk to the Company, including financial, operational, legal, regulatory, information security and cybersecurity and strategic risks (the “Company Risk Reports”).
|
(2)
|
The Audit Committee receives the Company Risk Reports from members of management tasked with the responsibility to understand,
manage and mitigate the risks (with the Company’s enterprise risk management effort being facilitated by its Internal Audit function).
|
(3)
|
The Chair of the Audit Committee reports on its discussion of the Company Risk Reports to the full Board during the Committee
reports portion of the Board meeting following the receipt of said Company Risk Reports, which enables the Board and its Committees to coordinate the risk oversight role, particularly with respect to cross-discipline risks and
interrelated risks.
|
•
|
Reliable, Scalable Systems and Infrastructure
|
•
|
Automation and Artificial Intelligence
|
•
|
Training
|
(1)
|
Executive Committee;
|
(2)
|
Audit Committee;
|
(3)
|
Compensation Committee; and
|
(4)
|
Governance Committee.
|
|
Name
|
| |
Audit
|
| |
Compensation
|
| |
Governance
|
| |
Executive
|
|
|
David Fischer
|
| | | |
![]() |
| |
![]() |
| |
![]() |
| |
|
Kathleen Fish
|
| |
|
| |
![]() |
| |
Chair
|
| |
![]() |
|
|
Daniel Knutson
|
| |
Chair
|
| |
![]() |
| | | | | ||
|
Joyce Lee
|
| |
![]() |
| |
|
| |
![]() |
| |
|
|
|
Olivier Rigaud
|
| |
![]() |
| | | |
![]() |
| | | ||
|
Monica Vicente
|
| |
![]() |
| |
|
| |
|
| |
|
|
|
Matthew Wineinger
|
| | | |
Chair
|
| | | |
Chair
|
| ||
|
Number of Committee Meetings Held in 2023
|
| |
7
|
| |
4*
|
| |
3
|
| |
0
|
|
*
|
Includes one special meeting.
|
(1)
|
monitor the integrity of the Company’s financial reporting process and systems of internal controls regarding finance, accounting,
and legal compliance;
|
(2)
|
monitor the independence, qualifications, performance and compensation of the Company’s independent auditors;
|
(3)
|
establish policies and procedures with respect to enterprise risk assessment and risk management;
|
(4)
|
review Company procedures for identifying, monitoring, and mitigating risk exposures, including cybersecurity risks; and
|
(5)
|
provide an avenue of communication among the independent auditors, internal audit, management and the Board.
|
(1)
|
ensure that compensation and benefit plans are aligned with the interests of shareholders and meet the needs of the Company and its
employees;
|
(2)
|
review, approve and recommend to the Board for approval various aspects of a compensation program, including incentives, for the
CEO and senior executives of the Company (the CEO may not be present during deliberations or voting on his compensation);
|
(3)
|
recommend to the Board for approval the compensation of directors;
|
(4)
|
administer the Company’s equity compensation plans; and
|
(5)
|
interpret, construe, and administer the Company’s Incentive-Based Compensation Recovery Policy, including reviewing such policy
from time to time and recommending any changes to the Board for adoption.
|
(1)
|
considering and making recommendations to the Board concerning the appropriate size, function and needs of the Board;
|
(2)
|
determining the criteria for Board membership, overseeing searches, and evaluating and recommending candidates for election to the
Board;
|
(3)
|
evaluating and recommending to the Board responsibilities of the Board committees;
|
(4)
|
annually reviewing and assessing the adequacy of the Governance Guidelines and recommending any changes to the Board for adoption;
|
(5)
|
annually evaluating its own performance as well as overseeing an annual self-evaluation of the Board (which includes a director
self-assessment) and other Board Committees;
|
(6)
|
overseeing compliance with the Company’s Stock Ownership Policies;
|
(7)
|
developing and recommending to the Board for approval a CEO and other key executive succession plan (the “Succession Plan”), reviewing the Succession Plan annually with the CEO and Board, developing and evaluating potential candidates for these positions and recommending to the Board any candidates or changes to previously
identified candidates under the Succession Plan;
|
(8)
|
considering matters of corporate social responsibility, including reviewing the Company’s activities and practices regarding
sustainability, including environmental, social, and governance (“ESG”) matters that are significant to the Company and periodically reviewing the Company’s sustainability strategy, initiatives and
policies;
|
(9)
|
recruiting and evaluating new candidates for nomination by the full Board for election as directors;
|
(10)
|
preparing and updating an orientation program for new directors;
|
(11)
|
evaluating the performance of current directors in connection with the expiration of their term in office and providing advice to
the full Board as to their nomination for reelection; and,
|
(12)
|
annually reviewing and recommending policies on director retirement age.
|
(1)
|
the recruitment, evaluation and selection of suitable candidates for the position of CEO, for approval by the full Board; and,
|
(2)
|
the preparation, together with the Compensation Committee, of objective criteria for the evaluation of the performance of the CEO.
|
•
|
Our Corporate Governance Guidelines do not require the Chairman to be an independent
director and do not require separation of the Chairman and CEO positions. However, per our Corporate Governance Guidelines, the Board appoints a Lead Director who functions to reinforce the independence of the Board of Directors, and is
appointed from the independent directors.
|
•
|
The Board and the Governance Committee regularly consider the appropriate leadership
structure for the Company and have concluded that the Company and its shareholders are best served by the Board and the Governance Committee retaining discretion to determine whether the same individual should serve as both CEO and
Chairman.
|
•
|
The Board and the Governance Committee believe it is important to retain the
flexibility to make this determination based on what it believes will provide the best leadership structure for the Company at any given time.
|
•
|
The combined Chairman and CEO structure promotes decisive leadership, ensures clear
accountability and enhances our ability to communicate with a single and consistent voice to shareholders, employees and other stakeholders.
|
•
|
Mr. Harris has an extensive understanding and grasp of our business and operations,
competitive pressures and the challenges the Company faces in the current environment, and has demonstrated leadership and management skills, and is best situated to lead and focus discussions on those critical matters affecting the
Company, which increases the effectiveness of Board meetings.
|
•
|
Finally, the combination of the Chairman and the CEO position succeeds because of the
engaged, knowledgeable involvement of our Board in combination with our culture of open communication with the CEO and senior management, enabling the CEO to be an effective conduit between management and the Board.
|
(1)
|
working with the Chairman and other directors to set agendas for Board meetings;
|
(2)
|
together with the Executive Committee, providing leadership in times of crisis;
|
(3)
|
reviewing the individual performance of each of the directors with the Chair of the Governance Committee;
|
(4)
|
chairing regular meetings of independent Board members without management present (executive sessions);
|
(5)
|
acting as liaison between the independent directors and the Chairman; and
|
(6)
|
chairing Board meetings when the Chairman is not in attendance.
|
(i)
|
was, during the last completed fiscal year, an officer or employee of the Company,
|
(ii)
|
was formerly an officer of the Company, or
|
(iii)
|
had any relationship requiring disclosure by the Company under Item 404 of Regulation S-K under the Securities Act of 1933, as
amended.
|
(1)
|
have experience and skills in areas critical to understanding the Company and its business;
|
(2)
|
possess certain personal characteristics, such as integrity and judgment;
|
(3)
|
have a diverse background of experience and perspectives (including business experience, geographic origin, age, gender, and
ethnicity); and
|
(4)
|
have sufficient ability to commit the necessary time and effort required to serve on the Board.
|
•
|
Hold annual election of directors
|
•
|
Hold advisory approval by shareholders of executive compensation (“Say-on-Pay” votes)
annually
|
•
|
Senior management attends major investor conferences each year
|
•
|
Majority voting in uncontested director elections
|
•
|
Hold “Say-on-Frequency” votes regarding advisory approval of executive compensation
at least every six years (Note: Based on the results of the 2023 Say-on-Frequency vote, the Company will hold Say-on-Pay votes annually)
|
•
|
Share information through the Company website, Annual Report, press releases, and SEC
filings, including 10-K, 10-Q, 8-K, and Proxy Statement
|
(1)
|
Annual Cash Retainer – $65,000;
|
(2)
|
Annual Fee for Lead Director - $20,000
|
(3)
|
Annual Fee for Audit Committee Chair – $15,000;
|
(4)
|
Annual Fee for Compensation Committee Chair – $10,000; and
|
(5)
|
Annual Fee for the Governance Committee Chair – $10,000.
|
|
Name
|
| |
Retainer
& Fees
|
| |
Stock Awards(1)
|
| |
All Other
Compensation ($)
|
| |
Total ($)
|
|
|
David Fischer
|
| |
$ 65,000
|
| |
$146,259
|
| |
$0
|
| |
$211,259
|
|
|
Kathleen Fish
|
| |
$ 72,500
|
| |
$146,259
|
| |
$0
|
| |
$218,759
|
|
|
Daniel Knutson
|
| |
$ 80,000
|
| |
$146,259
|
| |
$0
|
| |
$ 226,259
|
|
|
Joyce Lee
|
| |
$ 65,000
|
| |
$146,259
|
| |
$0
|
| |
$211,259
|
|
|
Perry Premdas(2)
|
| |
$ 32,500
|
| |
$0
|
| |
$0
|
| |
$ 32,500
|
|
|
Olivier Rigaud
|
| |
$21,667(3)
|
| |
$0
|
| |
$0
|
| |
$21,667
|
|
|
John Televantos(2)
|
| |
$ 45,000
|
| |
$0
|
| |
$0
|
| |
$ 45,000
|
|
|
Monica Vicente
|
| |
$21,667
|
| |
$0
|
| |
$0
|
| |
$21,667
|
|
|
Matthew Wineinger
|
| |
$ 85,000
|
| |
$146,259
|
| |
$0
|
| |
$231,259
|
|
(1)
|
On February 8, 2023, each Non-Executive Director, was granted 530 Time-Based
Restricted Shares and 1,790 Stock Options. The Time-Based Restricted Shares cliff vest after three years. The grant date fair value per share of each share of restricted stock was $138.09. The Stock Options have a strike price of
$138.09 per share and expire on February 8, 2033.
|
(2)
|
Dr. John Televantos and Perry Premdas completed their terms on June 22, 2023.
Accordingly, their respective cash retainer and fees were pro-rated based on their dates of service in 2022.
|
(3)
|
The retainer payment for Mr. Rigaud was processed in Q1 2024 due to
administrative reasons.
|
|
Name
|
| |
Aggregate
Stock Options Outstanding
as of 12/31/2023
|
| |
Aggregate
Stock Awards Outstanding
as of 12/31/2023
|
|
|
David Fischer
|
| |
15,577
|
| |
1,629
|
|
|
Kathleen Fish
|
| |
3,537
|
| |
1,039
|
|
|
Daniel Knutson
|
| |
15,577
|
| |
1,629
|
|
|
Joyce Lee
|
| |
8,607
|
| |
1,629
|
|
|
Olivier Rigaud
|
| |
0
|
| |
0
|
|
|
Monica Vicente
|
| |
0
|
| |
0
|
|
|
Matthew Wineinger
|
| |
15,577
|
| |
1,629
|
|
(A)
|
1/36 of the total number of Time-Based Restricted Shares subject to the applicable grant; and
|
(B)
|
the number of full months that the director has served on the Board from the date of the grant to the date of the director’s
retirement or resignation, as applicable; and all Restricted Shares not so vested shall be immediately forfeited.
|
(1)
|
in accordance with the Director Retirement Policy discussed above and the combination of the Director’s age and years of service as
a member of the Board is equal to or greater than 75; or
|
(2)
|
prior to the conclusion of his or her term in which he or she reaches the age of 70 and the combination of the Director’s age and
years of service as a member of the Board is equal to or greater than 75 and he/she has given the Company one (1) year’s prior written notice to the Company of his/her intention to retire;
|
(A)
|
all Stock Options shall continue to vest and become exercisable in accordance with their original vesting schedule; and
|
(B)
|
All Time-Based Restricted Shares shall continue to vest in accordance with their original vesting schedule.
|
|
Name
|
| |
Position
|
|
|
Theodore L. Harris
|
| |
Chairman, President and Chief Executive Officer
|
|
|
C. Martin Bengtsson
|
| |
Executive Vice President and Chief Financial Officer
|
|
|
Frederic Boned
|
| |
Senior Vice President and General Manager,
Human Nutrition and Health
|
|
|
Hatsuki Miyata
|
| |
Executive Vice President, General Counsel and Secretary
|
|
|
Martin L. Reid
|
| |
Senior Vice President and Chief Supply Chain Officer
|
|
|
We DO
|
| |
We DON’T
|
|
|
Target total direct compensation for our NEOs generally at the 50th percentile as
part of our annual benchmarking process against a similarly sized peer group.
|
| |
Allow hedging or pledging of Company securities for any employee (including our
NEOs) or director.
|
|
|
Pay for performance and, accordingly, a significant portion of each NEO’s total
compensation opportunity is “at risk” and dependent upon achievement of specific corporate and individual performance goals, resulting in lesser emphasis on fixed base salary.
|
| |
Encourage unnecessary or excessive risk-taking as a result of our compensation
policies and practices.
|
|
|
Base our short-term incentive plan on explicit and quantifiable Corporate and
business segment financial performance metrics that are set at the beginning of each year.
|
| |
Have employment agreements with any of our NEOs other than as described in the
section of this proxy statement titled “Executive Compensation.”
|
|
|
Complement our annual compensation to each NEO with time-based and
performance-based multi-year vesting schedules and performance cycles for equity incentive awards.
|
| |
Provide a defined benefit pension plan for our NEOs.
|
|
|
Have annual base salary adjustments that are based, primarily, on prior-year
individual performance.
|
| |
Provide for “gross ups” for excise taxes imposed with respect to Section 280G
(change-in-control payments) or Section 409A (nonqualified deferred compensation) of Internal Revenue Code of 1986, as amended (the “Code”).
|
|
|
Maintain a clawback provision pursuant to which the Company can seek reimbursement
of either cash or equity-based incentive compensation in the event of a financial restatement, to the extent set forth in any applicable compensation recovery policy contained in the Amended 2017 Plan or implemented by the Company.
|
| |
Except as may be provided for from time-to-time under employment agreements,
provide for single-trigger vesting acceleration upon a change in control of the Company. There are currently no outstanding awards that provide for single-trigger vesting.
|
|
|
Maintain a Compensation Committee, which is comprised solely of independent
directors.
|
| |
Allow: (i) any repricing of options and Stock Appreciation Rights (“SARs”) without shareholder approval or (ii) for the unlimited transferability of awards.
|
|
|
Have stock ownership guidelines for our executives and non-employee directors.
|
| |
|
|
|
Subject awards under the Amended 2017 Plan to minimum vesting periods and maximum
annual per-person limits.
|
| | | |
|
Ensure that a significant portion of our non-employee director compensation
consists of long-term equity awards.
|
| |
|
|
|
Consult with outside experts to determine the overall competitiveness of the
Company’s executive compensation program.
|
| | |
|
Shareholder Engagement Highlights
|
| ||||||
|
Engaged with:
✔ Institutional investors
✔ Retail shareholders
✔ Pension funds
✔ Proxy advisory firms
✔ Industry associations
|
| |
Engaged through:
✔ Quarterly earnings call
✔ Investor conferences
✔ Individual investor meetings
✔ Annual General Meeting of
Shareholders
✔ Sustainability Report
✔ Data verification process of proxy advisory firms
|
| |
Engagements include:
✔ President, Chairman
and CEO
✔ CFO and Investor Relations
team
✔ Executive Officers
✔ Independent Directors
✔ Head of Global Sustainability
|
|
|
In 2023, engaged with shareholders representing:
Over 80% of total outstanding shares
or
Over 25.8 million shares
|
| |
Information shared through:
• SEC filings including 10-K, 10-Q, 8-K and Proxy Statement
• Quarterly earnings call
• Press releases
• Company website
• Media and digital platforms
|
|
•
|
The Compensation Committee does not expect to make one-time equity awards to
executive officers, absent extraordinary circumstances, such as in connection with new hires or promotions. This is consistent with not otherwise having a history of granting one-time retention awards to executive officers.
|
•
|
In October 2023, the Compensation Committee selected Pearl Meyer as its new
independent compensation consultant. Pearl Meyer is a leading independent executive and board compensation consulting firm.
|
•
|
In December 2023, the Compensation Committee completed a review and update of
Balchem’s executive compensation peer group, which will be used for benchmarking purposes in 2024.
|
•
|
The Company has enhanced its disclosure of the performance achievement metrics (TSR
and EBITDA) for the Company’s 2021-2023 performance share grant cycle.
|
•
|
Limitation on Shares: The maximum number of shares which may be issued under the Amended 2017 Plan is 2,400,000 shares;
|
•
|
No Repricing of Stock Options or SARs: No repricing (or amendments or replacements related to a repricing) of outstanding Stock Options/SARs is allowed without shareholder approval;
|
•
|
No Discounted Awards: The exercise price per share of stock under a Stock Option or SAR award must be not less than the fair market value of our Common Stock on the date of grant;
|
•
|
Minimum Vesting: Except for 5% of the shares authorized for grant under the Amended 2017 Plan and other limited exceptions, awards (other than cash performance awards) are generally subject to a minimum vesting period of one year;
|
•
|
Dividends or Dividend Equivalents: Dividends or dividend equivalents otherwise payable on an unvested award will accrue and be paid only when the vesting conditions applicable to the underlying award have been satisfied;
|
•
|
No Liberal Share Recycling: Recycling of shares used to satisfy the exercise price or taxes for any awards is prohibited;
|
•
|
No Liberal Change in Control: The consummation of a merger or similar transaction and a minimum acquisition of 50% of the outstanding shares is required before a change-in-control occurs;
|
•
|
No Automatic “Single-Trigger” Vesting on Change in Control: There is no automatic acceleration of any outstanding awards upon the occurrence of a change in control;
|
•
|
Limitations on Awards to Non-Employee Directors: In the case of awards to non-employee directors, the maximum amount or value that may be granted in any calendar year (inclusive of cash compensation) may not exceed $800,000; and
|
•
|
Compensation Recovery: In the event that the Company is required to prepare an accounting restatement of its financial statements due to the Company’s material noncompliance with any financial reporting requirements under the securities
laws, the Compensation Committee would have the discretion to require reimbursement or forfeiture of certain excess performance-based awards received by certain executive officers of the Company during the three completed fiscal years
immediately preceding the date that the Company is required to prepare an accounting restatement.
|
•
|
The CEO recommends to the Compensation Committee the amount of total annual
compensation for each of the other NEOs.
|
•
|
The CEO completes an annual performance assessment for each of the other NEOs, which
is reviewed and considered by the Compensation Committee.
|
•
|
The Compensation Committee conducts an annual performance appraisal of the CEO using
evaluation information solicited from each independent Board member and recommends to the Board the annual compensation package for the CEO.
|
|
American Vanguard Corp.
|
| |
H.B. Fuller Co.
|
| |
NewMarket Corp.
|
|
|
Ashland Global Corp.
|
| |
Hain Celestial Group
|
| |
Phibro Animal Health Corp.
|
|
|
Cabot Corp.
|
| |
Ingevity Corp.
|
| |
Quaker Chemical Corp.
|
|
|
Chase Corp.
|
| |
Innospec Inc.
|
| |
Sensient Technologies
|
|
|
Element Solutions
|
| |
J&J Snack Foods Corp.
|
| |
The Simply Good Foods Co.
|
|
|
Ferro Corp.
|
| |
Kraton Corp.
|
| |
Stepan Co.
|
|
|
FMC Corp.
|
| |
Lancaster Colony Corp.
|
| |
Tootsie Roll Industries
|
|
|
FutureFuel Corp.
|
| |
Minerals Technologies
|
| |
|
|
•
|
experience and industry knowledge;
|
•
|
the quality and effectiveness of their leadership;
|
•
|
performance relative to total compensation;
|
•
|
internal pay equity among the NEOs and other Company senior executives;
|
•
|
historical considerations;
|
•
|
retention factors; and
|
•
|
input from our CEO regarding individual performance.
|
•
|
Company Adjusted EBITDA (defined as earnings before interest, other expense/income,
taxes, depreciation, amortization, stock-based compensation, acquisition-related expenses and legal settlements, and the fair valuation of acquired inventory); and,
|
•
|
Free Cash Flow (defined as operating cash flow minus capital expenditures).
|
|
NEO
|
| |
ICP Target as a Percent of Base Salary
|
|
|
Ted Harris
|
| |
110%
|
|
|
C. Martin Bengtsson
|
| |
65%
|
|
|
Frederic Boned
|
| |
50%
|
|
|
Hatsuki Miyata
|
| |
50%
|
|
|
Martin Reid
|
| |
50%
|
|
|
Metric
|
| |
Weighting
|
| |
Threshold
|
| |
Target
|
| |
Stretch
|
| |
Maximum
|
|
|
Adjusted EBITDA
|
| |
70%
|
| |
$216.1
|
| |
$244.9
|
| |
$257.1
|
| |
269.4
|
|
|
Free Cash Flow
|
| |
30%
|
| |
$115.4
|
| |
$135.8
|
| |
$142.6
|
| |
$149.4
|
|
|
ESG Modifier for Executive Officers
|
| |
+/- 10%
|
| | | | | | | | |
|
Metric
|
| |
2023 Result
|
| |
Actual vs. Target
|
| |
Payout Percentage
|
|
|
Adjusted EBITDA
|
| |
$230.9 million
|
| |
94.3%
|
| |
51.5%
|
|
|
Free Cash Flow
|
| |
$151.1 million
|
| |
111.3%
|
| |
200%
|
|
|
NEO
|
| |
Target Equity
Multiplier
(of Base Salary)
|
|
|
Ted Harris
|
| |
3.00
|
|
|
C. Martin Bengtsson
|
| |
1.75
|
|
|
Frederic Boned
|
| |
1.00
|
|
|
Hatsuki Miyata
|
| |
1.00
|
|
|
Martin Reid
|
| |
1.00
|
|
•
|
25% of the 2023 Target Equity Value is awarded as Stock Options with an exercise
price equal to the fair market value of our Common Stock on the date of grant. Stock Options have a ten-year term and vest 20% after Year 1, 40% after Year 2 and 40% after Year 3.
|
•
|
25% of the 2023 Target Equity Value is awarded as Time-Based Restricted Shares which
are granted at the fair market value of our Common Stock on the date of grant and cliff vest three (3) years from said date.
|
•
|
25% of the 2023 Target Equity Value is awarded as EBITDA performance shares (“EBITDA Performance Shares”). The number of EBITDA Performance Shares that will vest (or not vest) is based upon the
attainment of a pre-determined Company EBITDA performance target over the three (3) fiscal years beginning with the fiscal year in which the grant was made (“Performance
Period”). The EBITDA Performance Shares will vest (or not vest) at the end of the Performance Period.
|
•
|
25% of the 2023 Target Equity Value is awarded as Total Shareholder Return
performance shares (the “TSR Performance Shares” and collectively with the EBITDA Performance Shares, the “Performance Shares”). The number of TSR Performance Shares that will vest (or not vest) is based upon the relative Company
TSR vs. the Russell 2000 Index over the three (3) fiscal years beginning with Performance Period.
|
|
2021 PSU GRANTS EBITDA
(50% Weight)
|
| ||||||||||||||||||
|
2020 FY EBITDA
|
| |
2023 FY EBITDA
|
| |
Actual EBITDA
Growth
(2021-2023)
|
| |
Threshold
EBITDA Growth
(50% of Target Payout)
|
| |
Target
EBITDA Growth
(100% of Target Payout)
|
| |
Maximum
EBITDA Growth
(200% of Target Payout)
|
| |
EBITDA Payout
as a % of Target
|
|
|
$162.1
|
| |
$213.8
|
| |
31.8%
|
| |
10.0%
|
| |
24.2%
|
| |
31.5%
|
| |
200.0%
|
|
|
2021 PSU GRANTS - Relative TSR
(50% Weight)
|
| |||||||||||||||
|
Balchem TSR
|
| |
Russell 2000
25th %'ile
(50% of Target Payout)
|
| |
Russell 2000
50th %'ile
(100% of Target Payout)
|
| |
Russell 2000
75th %'ile
(200% of Target Payout)
|
| |
Balchem
%'ile Rank
|
| |
TSR Payout
% of Target
|
|
|
23.8%
|
| |
-50.4%
|
| |
2.0%
|
| |
46.5%
|
| |
63.5
|
| |
153.9%
|
|
|
Director/Officer
|
| |
Ownership Requirement
(Value of Common Stock)
|
|
|
Directors
|
| |
5x multiple of annual cash retainer
|
|
|
CEO
|
| |
3x multiple of annual base salary
|
|
|
Chief Financial Officer
|
| |
1.5x multiple of annual base salary
|
|
|
All Other Executive Officers
|
| |
1x multiple of annual base salary
|
|
•
|
value of shares owned separately or owned jointly with, or separately by, immediate
family members residing in the same household;
|
•
|
value of shares held in trust for the benefit of the Executive Officer or Director
and immediate family members;
|
•
|
value of shares purchased on the open market;
|
•
|
value of shares acquired and held by an Executive Officer through the Company’s 401(k)
plan;
|
•
|
value of shares obtained through stock option exercise (and not thereafter sold); and
|
•
|
value of shares of restricted stock or performance shares, which have vested free and
clear of restrictive legends.
|
(i)
|
non-equity incentive plan awards that are earned solely or in part by satisfying a financial reporting measure performance goal;
|
(ii)
|
bonuses paid from a bonus pool, where the size of the pool is determined solely or in part by satisfying a financial reporting
measure performance goal;
|
(iii)
|
other cash awards based on satisfaction of a financial reporting measure performance goal;
|
(iv)
|
restricted stock, stock options and performance share units that are granted or vest solely or in part on satisfying a financial
reporting measure performance goal; and
|
(v)
|
proceeds from the sale of shares acquired through an incentive plan that were granted or vested solely or in part on satisfying a
financial reporting measure performance goal.
|
•
|
Our compensation consists of both fixed and variable components.
|
—
|
The fixed (or salary) portion of compensation is designed to provide a steady income regardless of our stock price performance so
that executives do not feel pressured to focus exclusively on stock price performance to the detriment of other important business aspects.
|
—
|
The variable portions of compensation (cash bonus and equity) are designed to reward both short- and long-term corporate
performance.
|
○
|
For short-term performance, our cash bonus is awarded based primarily on corporate
and business segment performance goals or targets.
|
○
|
For long-term performance, our Stock Options generally vest ratably over three years
and are only valuable if our stock price increases over time. Our Time-Based Restricted Share grants and Performance Share grants generally cliff vest in three years.
|
•
|
The variable elements of compensation are a sufficient percentage of overall
compensation to motivate executives to produce superior short- and long-term corporate results, while the fixed element is also sufficient such that executives are not encouraged to take unnecessary or excessive risks in doing so.
|
•
|
The use of Adjusted EBITDA as the contingent factor upon which ICP cash incentive
depends, encourages our executives to take a balanced approach that focuses on corporate profitability, rather than other measures such as revenue targets, which may create incentives for management to drive sales without regard to cost
structure. No payout is made under the ICP program if we are not sufficiently profitable.
|
•
|
Our ICP and LTIP awards are capped for each participant, which mitigates excessive
risk-taking. Even if the Company dramatically exceeds its Adjusted EBITDA target, the awards are limited. Conversely, there is no ICP or LTIP award unless minimum performance levels of applicable goals are achieved.
|
•
|
Because a portion of management’s personal investment portfolio consists of the
Company’s stock, we believe that the stock ownership guidelines we have in place provide a considerable incentive for management to consider the Company’s long-term interests in both their short- and long-term decisions. In addition, we
prohibit all hedging transactions involving our stock, so our executives and directors cannot insulate themselves from the effects of poor Company stock price performance.
|
|
Name
|
| |
Fixed Component of
Compensation
|
| |
Variable Component of
Compensation
|
|
|
Ted Harris
|
| |
20.4%
|
| |
79.6%
|
|
|
C. Martin Bengtsson
|
| |
31.3%
|
| |
68.7%
|
|
|
Frederic Boned
|
| |
40.7%
|
| |
59.3%
|
|
|
Hatsuki Miyata
|
| |
43.1%
|
| |
56.9%
|
|
|
Martin Reid
|
| |
42.1%
|
| |
57.9%
|
|
|
Name and
Principal Position
|
| |
Year
|
| |
Salary
|
| |
Bonus
(1)
|
| |
Stock
Awards
(2)
|
| |
Stock
Options
(2)
|
| |
Non-equity
Incentive Plan
Compensation
(3)
|
| |
Deferred
Compensation
Earnings
(4)
|
| |
All Other
Compensation
(5)
|
| |
Total
|
|
|
Ted Harris,
Chairman, President and Chief Executive Officer
|
| |
2023
|
| |
$1,155,000
|
| |
$0
|
| |
$2,601,958
|
| |
$867,121
|
| |
$1,219,937
|
| |
$0
|
| |
$ 45,691
|
| |
$ 5,889,707
|
|
|
2022
|
| |
$1,100,000
|
| |
$0
|
| |
$ 2,476,850
|
| |
$7,137,150
|
| |
$1,189,293
|
| |
$0
|
| |
$ 44,972
|
| |
$11,948,265
|
| |||
|
2021
|
| |
$ 1,050,000
|
| |
$0
|
| |
$2,165,751
|
| |
$725,105
|
| |
$ 1,757,640
|
| |
$0
|
| |
$ 63,177
|
| |
$5,761,673
|
| |||
|
C. Martin Bengtsson,
Executive Vice President and Chief Financial Officer
|
| |
2023
|
| |
$527,337
|
| |
$0
|
| |
$671,295
|
| |
$224,961
|
| |
$ 329,433
|
| |
$0
|
| |
$ 30,600
|
| |
$1,783,626
|
|
|
2022
|
| |
$ 502,226
|
| |
$0
|
| |
$ 601,307
|
| |
$201,299
|
| |
$ 329,903
|
| |
$0
|
| |
$ 32,000
|
| |
$1,666,735
|
| |||
|
2021
|
| |
$478,311
|
| |
$0
|
| |
$521,223
|
| |
$175,482
|
| |
$ 482,627
|
| |
$0
|
| |
$31,250
|
| |
$1,688,893
|
| |||
|
Frederic Boned,
Senior Vice President and General Manager, Human Nutrition and Health
|
| |
2023
|
| |
$432,765
|
| |
$ 50,000
|
| |
$319,662
|
| |
$106,345
|
| |
$198,832
|
| |
$0
|
| |
$ 30,600
|
| |
$1,138,204
|
|
|
2022
|
| |
$65,385
|
| |
$0
|
| |
$ 419,400
|
| |
$0
|
| |
$ 150,000
|
| |
$0
|
| |
$51,662
|
| |
$ 686,447
|
| |||
|
Hatsuki Miyata,
Executive Vice President, General Counsel and Secretary
|
| |
2023
|
| |
$435,870
|
| |
$0
|
| |
$319,662
|
| |
$106,345
|
| |
$ 209,399
|
| |
$0
|
| |
$46,147
|
| |
$1,117,423
|
|
|
2022
|
| |
$176,539
|
| |
$0
|
| |
$ 534,000
|
| |
$0
|
| |
$218,809
|
| |
$0
|
| |
$46,319
|
| |
$ 975,667
|
| |||
|
Martin Reid,
Senior Vice President and Chief Supply Chain Officer
|
| |
2023
|
| |
$ 454,920
|
| |
$0
|
| |
$ 335,647
|
| |
$114,525
|
| |
$218,571
|
| |
$0
|
| |
$ 30,600
|
| |
$1,154,263
|
|
|
2022
|
| |
$437,423
|
| |
$0
|
| |
$319,777
|
| |
$ 108,701
|
| |
$ 202,836
|
| |
$0
|
| |
$ 32,000
|
| |
$1,100,737
|
| |||
|
2021
|
| |
$375,962
|
| |
$0
|
| |
$ 499,872
|
| |
$191,128
|
| |
$339,539
|
| |
$0
|
| |
$26,227
|
| |
$1,432,728
|
|
(1)
|
Reflects the value of cash sign-on bonus.
|
(2)
|
The amounts included in the “Stock Awards” and “Stock Options” columns
reflect the aggregate grant date fair value as computed in accordance with FASB Accounting Standards Codification 718 adjusted to eliminate service-based forfeiture assumptions used for financial reporting purposes. A discussion of the
assumptions used in valuation of Stock Options may be found in “Note 3 – Shareholders’ Equity” in the Notes to Consolidated Financial Statements of our Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the
SEC on February 16, 2024. For the fiscal years ended December 31, 2021 - 2023, the awards reported in the “Stock Awards” column above consist of Performance Shares and Time-Based Restricted Shares. The grant date fair value of the
Performance Shares is reflected at target payout based on the probable outcome of the applicable performance conditions. The maximum value for the Performance Shares is as follows: (i) for 2023: Mr. Harris – $3,189,879; Mr. Bengtsson –
$823,016; Mr. Boned - $392,176; Ms. Miyata - $392,176; Mr. Reid - $411,508; (ii) for 2022: Mr. Harris – $3,523,546; Mr. Bengtsson – $856,034; Mr. Boned – N/A; Mr. Ms. Miyata - N/A; Mr. Reid - $455,631; and (iii) for 2021: Mr. Harris -
$2,713,781; Mr. Bengtsson – $652,832; Mr. Boned – N/A; Ms. Miyata - N/A; Mr. Reid $402,659, with the foregoing being calculated by multiplying the number of shares that would be granted upon achievement of the highest performance
conditions by the price on the grant date. For Ms. Miyata, the Stock Awards column for 2022 reflects sign-on Time-Based Restricted shares granted in part in recognition of the value in unvested equity and other benefits from her prior
employer that she forfeited. In September 2022, the Compensation Committee approved a one-time retention grant comprised of 130,000 stock options with a grant date of September 15, 2022, and an estimated grant date fair value of
approximately $6.3 million for Mr. Harris as part of the Company’s retention strategy and consistent with its pay-for-performance compensation philosophy. This stock options award grant is structured in four tranches with increasing
exercise prices: (a) 25% at fair market value as of grant date (“FMV”); (b) 25% at FMV plus 10% premium; (c) 25% at FMV plus 15% premium; and (d) 25% at FMV plus 20% premium. Further, the options vest over a five-year period with: (a)
25% vesting on the third anniversary of the grant date; (b) 25% vesting on the fourth anniversary of the grant date; and (c) 50% vesting on the fifth anniversary of the grant date. The options expire on the tenth anniversary of the
grant date.
|
(3)
|
Reflects the value of cash incentive bonuses earned under the Company’s ICP.
|
(4)
|
The Deferred Compensation Plan does not provide above-market or preferential
earnings.
|
(5)
|
The amounts listed in the “All Other Compensation” column for fiscal 2023
include actual and estimated matching by the Company under the 401(k) Plan, and other perquisites and personal benefits, and details about these amounts are set forth in the table below.
|
|
Name
|
| |
Company 401k
Plan Matching
|
| |
Other
Perquisites
|
| |
Total All Other
Compensation
|
|
|
Ted Harris
|
| |
$19,800
|
| |
$25,891
|
| |
$45,691
|
|
|
C. Martin Bengtsson
|
| |
$19,800
|
| |
$10,800
|
| |
$ 30,600
|
|
|
Frederic Boned
|
| |
$19,800
|
| |
$10,800
|
| |
$ 30,600
|
|
|
Hatsuki Miyata
|
| |
$19,800
|
| |
$26,347
|
| |
$46,147
|
|
|
Martin Reid
|
| |
$19,800
|
| |
$10,800
|
| |
$ 30,600
|
|
|
Name
|
| |
Grant
Date
|
| |
Grant Type
|
| |
Estimated Future Payouts
Under Non-Equity Incentive
Plan Awards(1)
|
| |
Estimated Future Payouts
Under Equity Incentive
Plan Awards(2)
|
| |
All Other
Stock
Awards:
Number of
Shares of
Stock
(#)
|
| |
All Other:
Number
of
Securities
Underlying
Stock
Options
(#)
|
| |
Exercise
Price of
Stock
Option(3)
($/Share)
|
| |
Grant Date
Fair Value
of Stock
and
Option
Awards(4)
($)
|
| ||||||||||||
|
Threshold
|
| |
Target
|
| |
Maximum
|
| |
Threshold
(#)
|
| |
Target
(#)
|
| |
Maximum
(#)
|
| |||||||||||||||||||||
|
Ted Harris
|
| | | |
ICP
|
| |
$0
|
| |
$1,270,500
|
| |
$2,541,000
|
| | | | | | | | | | | | | | | ||||||||
|
02/08/2023
|
| |
Performance Shares
|
| | | | | | | |
5,775
|
| |
11,550
|
| |
23,100
|
| | | | | | | | | ||||||||||
|
02/08/2023
|
| |
Time-Based Restricted Shares
|
| | | | | | | | | | | | | |
6,280
|
| | | | | | | ||||||||||||
|
02/08/2023
|
| |
Stock Options
|
| | | | | | | | | | | | | | | |
21,200
|
| |
$138.09
|
| | | |||||||||||
| | | | | | | | | | | | | | | | | | | | | | |
$3,469,079
|
| ||||||||||||||
|
C. Martin Bengtsson
|
| | | |
ICP
|
| |
$0
|
| |
$342,769
|
| |
$685,538
|
| | | | | | | | | | | | | | | ||||||||
|
02/08/2023
|
| |
Performance Shares
|
| | | | | | | |
1,490
|
| |
2,980
|
| |
5,960
|
| | | | | | | | | ||||||||||
|
02/08/2023
|
| |
Time-Based Restricted Shares
|
| | | | | | | | | | | | | |
1,620
|
| | | | | | | ||||||||||||
|
02/08/2023
|
| |
Stock Options
|
| | | | | | | | | | | | | | | |
5,500
|
| |
$138.09
|
| | | |||||||||||
| | | | | | | | | | | | | | | | | | | | | | |
$896,255
|
| ||||||||||||||
|
Frederic Boned
|
| | | |
ICP
|
| |
$0
|
| |
$216,382
|
| |
$432,765
|
| | | | | | | | | | | | | | | ||||||||
|
02/08/2023
|
| |
Performance Shares
|
| | | | | | | |
710
|
| |
1,420
|
| |
2,840
|
| | | | | | | | | ||||||||||
|
02/08/2023
|
| |
Time-Based Restricted Shares
|
| | | | | | | | | | | | | |
770
|
| | | | | | | ||||||||||||
|
02/08/2023
|
| |
Stock Options
|
| | | | | | | | | | | | | | | |
2,600
|
| |
$138.09
|
| | | |||||||||||
| | | | | | | | | | | | | | | | | | | | | | |
$426,007
|
| ||||||||||||||
|
Hatsuki Miyata
|
| | | |
ICP
|
| |
$0
|
| |
$217,935
|
| |
$435,870
|
| | | | | | | | | | | | | | | ||||||||
|
02/08/2023
|
| |
Performance Shares
|
| | | | | | | |
710
|
| |
1,420
|
| |
2,840
|
| | | | | | | | | ||||||||||
|
02/08/2023
|
| |
Time-Based Restricted Share Awards
|
| | | | | | | | | | | | | |
770
|
| | | | | | | ||||||||||||
|
02/08/2023
|
| |
Stock Options
|
| | | | | | | | | | | | | | | |
2,600
|
| |
$138.09
|
| | | |||||||||||
| | | | | | | | | | | | | | | | | | | | | | |
$427,007
|
| ||||||||||||||
|
Martin Reid
|
| | | |
ICP
|
| |
$0
|
| |
$227,460
|
| |
$454,920
|
| | | | | | | | | | | | | | | ||||||||
|
02/08/2023
|
| |
Performance Shares
|
| | | | | | | |
745
|
| |
1,490
|
| |
2,980
|
| | | | | | | | | ||||||||||
|
02/08/2023
|
| |
Time-Based Restricted Shares
|
| | | | | | | | | | | | | |
810
|
| | | | | | | ||||||||||||
|
02/08/2023
|
| |
Stock Options
|
| | | | | | | | | | | | | | | |
2,800
|
| |
$138.09
|
| | | |||||||||||
| | | | | | | | | | | | | | | | | | | | | | |
$450,173
|
|
(1)
|
The maximum amounts equal 200% of target. Additional information regarding
the design of the ICP is included in the Compensation Discussion and Analysis.
|
(2)
|
The target number of shares shown in the table reflects the number of shares
of our Common Stock earned if performance is achieved at target levels. All shares will be awarded net of applicable tax withholding. Dividend equivalents accrue during the performance cycle and will be paid out in shares, net of
applicable tax withholding, based on the actual number of shares earned for the performance cycle, if any.
|
(3)
|
The exercise price equals the closing price of our Common Stock on the grant
date except as otherwise indicated.
|
(4)
|
The amounts represent the grant date fair value of the awards as computed in
accordance with FASB ASC Topic 718.
|
1.
|
Officers and other employees of the Company may be granted Stock Options which qualify as incentive stock options (“ISOs”) under Section 422(b) of the Code;
|
2.
|
Directors, officers and employees may be granted Stock Options which do not qualify as ISOs (“Non-Qualified
Options”); and
|
3.
|
Directors, officers and employees may be granted Time-Based Restricted Shares and Performance Shares.
|
|
Name
|
| | | |
Stock Awards
|
| |
Performance Awards
|
| ||||||||||||||||
|
# Of Securities Unexercised Underlying Options
|
| ||||||||||||||||||||||||
|
Exercisable(1)
|
| |
Not currently
Exercisable(1)
|
| |
Option
Exercise
Price/share
|
| |
Option
Expiration
Date
|
| |
Number of
Unvested
Shares
|
| |
$(3)
|
| |
Number of
Unvested
Shares(2)
$
|
| |
$(3)
|
| |||
|
Ted Harris
|
| |
10,000
|
| |
0
|
| |
54.87
|
| |
4/28/2025
|
| | | | | | | | | ||||
|
24,350
|
| |
0
|
| |
60.85
|
| |
2/23/2026
|
| | | | | | | | | |||||||
|
25,930
|
| |
0
|
| |
85.40
|
| |
2/21/2027
|
| | | | | | | | | |||||||
|
18,800
|
| |
0
|
| |
74.57
|
| |
2/15/2028
|
| | | | | | | | | |||||||
|
28,300
|
| |
0
|
| |
84.09
|
| |
2/13/2029
|
| | | | | | | | | |||||||
|
24,500
|
| |
0
|
| |
111.94
|
| |
2/13/2030
|
| | | | | | | | | |||||||
|
13,140
|
| |
8,760
|
| |
119.13
|
| |
2/11/2031
|
| | | | | | | | | |||||||
|
4,100
|
| |
16,400
|
| |
138.07
|
| |
2/10/2032
|
| | | | | | | | | |||||||
|
0
|
| |
32,500
|
| |
125.71
|
| |
9/15/2032
|
| | | | | | | | | |||||||
|
0
|
| |
32,500
|
| |
138.28
|
| |
9/15/2032
|
| | | | | | | | | |||||||
|
0
|
| |
32,500
|
| |
144.57
|
| |
9/15/2032
|
| | | | | | | | | |||||||
|
0
|
| |
32,500
|
| |
150.85
|
| |
9/15/2032
|
| | | | | | | | | |||||||
|
0
|
| |
21,200
|
| |
138.09
|
| |
2/8/2033
|
| |
18,320
|
| |
$2,725,100
|
| |
35,700
|
| |
$5,310,375
|
| |||
|
C. Martin
Bengtsson
|
| |
15,000
|
| |
0
|
| |
85.33
|
| |
2/4/2029
|
| | | | | | | | | ||||
| | |
6,000
|
| |
0
|
| |
84.09
|
| |
2/13/2029
|
| | | | | | | | | |||||
| | |
4,800
|
| |
0
|
| |
111.94
|
| |
2/13/2030
|
| | | | | | | | | |||||
| | |
3,180
|
| |
2,120
|
| |
119.13
|
| |
2/11/2031
|
| | | | | | | | | |||||
| | |
1000
|
| |
4,000
|
| |
138.07
|
| |
2/10/2032
|
| | | | | | | | | |||||
| | |
0
|
| |
5,500
|
| |
138.09
|
| |
2/8/2033
|
| |
4,530
|
| |
$ 673,838
|
| |
8,820
|
| |
$1,311,975
|
| |
|
Frederic Boned
|
| |
0
|
| |
2,600
|
| |
138.09
|
| |
2/8/2033
|
| |
3,770
|
| |
$ 560,788
|
| |
1,420
|
| |
$211,225
|
|
|
Hatsuki Miyata(4)
|
| |
0
|
| |
2,600
|
| |
138.09
|
| |
2/8/2033
|
| |
3,437
|
| |
$511,254
|
| |
1,420
|
| |
$211,225
|
|
|
Martin Reid
|
| |
1,500
|
| |
1,000
|
| |
118.96
|
| |
2/8/2031
|
| | | | | | | | | ||||
| | |
1,980
|
| |
1,320
|
| |
119.13
|
| |
2/11/2031
|
| | | | | | | | | |||||
| | |
540
|
| |
2,160
|
| |
138.07
|
| |
2/10/2032
|
| |
|
| |
|
| |
|
| |
|
| |
| | |
0
|
| |
2,800
|
| |
138.09
|
| |
2/8/2033
|
| |
3,980
|
| |
$592,025
|
| |
4,830
|
| |
$718,463
|
|
(1)
|
Stock Options granted under the Amended 2017, the 2017 Plan, and the 1999
Plan have a term of ten years from the grant date and become exercisable 20% after 1 year, 60% after 2 years and 100% after 3 years, beginning on the first anniversary of the grant date.
|
(2)
|
Time-Based Restricted Shares vest three years from the date of grant.
Performance Shares vest in three years and are reflected at target payout based on the probable outcome of the performance conditions. The following table provides information with respect to the final vesting dates of each outstanding
restricted stock award (both Time-Based Restricted Shares and Performance Shares) held by each NEO as of December 31, 2023.
|
(3)
|
Value is computed based on the closing price of our Common Stock on December 29,
2023, which was $148.75 per share.
|
|
Final Vesting Date
|
| |
Ted
Harris
|
| |
Martin
Bengtsson
|
| |
Frederic
Boned
|
| |
Hatsuki
Miyata
|
| |
Martin
Reid
|
|
|
Jan. 1, 2024
|
| |
11,390
|
| |
2,740
|
| | | | | |
1,690
|
| ||
|
Feb. 8, 2024
|
| | | | | | | | | |
1,500
|
| ||||
|
Feb. 11, 2024
|
| |
6,060
|
| |
1,460
|
| | | | | |
900
|
| ||
|
July 27, 2024
|
| | | | | | | |
1,333(4)
|
| | | ||||
|
Jan. 1, 2025
|
| |
12,760
|
| |
3,100
|
| | | | | |
1,650
|
| ||
|
Feb. 10, 2025
|
| |
5,980
|
| |
1,450
|
| | | | | |
770
|
| ||
|
July 27, 2025
|
| | | | | | | |
1,334
|
| | | ||||
|
Oct. 31, 2025
|
| | | | | |
3,000
|
| | | | | ||||
|
Jan. 1, 2026
|
| |
11,550
|
| |
2,980
|
| |
1,420
|
| |
1,420
|
| |
1,490
|
|
|
Feb. 8, 2026
|
| |
6,280
|
| |
1,620
|
| |
770
|
| |
770
|
| |
810
|
|
|
Total
|
| |
54,020
|
| |
13,350
|
| |
5,190
|
| |
4,857
|
| |
8,810
|
|
(4)
|
In connection with the hiring of Ms. Miyata as Executive Vice President,
General Counsel and Secretary, the Company provided in part that Ms. Miyata would receive 4,000 shares of Company Time-Based Restricted Shares, which will vest ratably over three years after the date of grant (July 27, 2022), with one
third vesting each year beginning in 2023. These Time-Based Restricted Shares were granted in part in recognition of the value in unvested equity and other benefits from her prior employer that she forfeited.
|
| | |
Option Awards
|
| |
Stock Awards
|
| |||||||
|
Name
|
| |
Number of
Shares
Acquired on
Exercise
(#)
|
| |
Value
Realized on
Exercise
($)(1)
|
| |
Number of
Shares
Acquired on
Vesting
(#)
|
| |
Value
Realized on
Vesting
($)
|
|
|
Ted Harris
|
| |
0
|
| |
N/A
|
| |
22,374(2)
|
| |
$3,077,453
|
|
|
Martin Bengtsson
|
| |
0
|
| |
N/A
|
| |
4,352(2)
|
| |
$ 598,596
|
|
|
Frederic Boned
|
| |
0
|
| |
N/A
|
| |
0
|
| |
N/A
|
|
|
Hatsuki Miyata
|
| |
0
|
| |
N/A
|
| |
1,333(3)
|
| |
$171,344
|
|
|
Martin Reid
|
| |
0
|
| |
N/A
|
| |
0
|
| |
N/A
|
|
(1)
|
Value realized represents the excess of the fair market value of the shares
at the time of exercise over the exercise price of the options.
|
(2)
|
Reflects the vesting of (a) Performance Shares granted in 2020 under the
Fiscal 2020 – 2022 Performance Share awards including dividend equivalent shares; and (b) Time-based Restricted Shares granted in 2020, subject to a three year vesting requirement. The Performance Shares were subject to performance
goals for the performance period ended December 31, 2022, with the number of TSR Performance Shares vesting representing 181.6% of the target shares and the EBITDA Performance Shares vesting representing 200.0% of the target shares.
Awards vested on February 8, 2023. See “LTIP Awards” beginning at Page 41 above). Values realized for Performance Shares earned are based on the closing share prices $138.09 on February 8, 2023, the date the
Compensation Committee determined that the performance targets for the performance period ended December 31, 2022 had been met.
|
(3)
|
Reflects the vesting of Time-based Restricted Shares which vest ratably over
three years after the grant date (July 27, 2022), with one third vesting each year beginning in 2023. These Time-Based Restricted Shares were granted in part in recognition of the value in unvested equity and other benefits from
Ms. Miyata’s prior employer that she forfeited.
|
|
Name
|
| |
NEO
Contributions in
Last Fiscal
Year(1)
($)
|
| |
Aggregate
Earnings in Last
Fiscal Year
($)
|
| |
Aggregate
Withdrawals/
Distributions
($)
|
| |
Aggregate
Balance at
Last Fiscal
Year End
($)
|
|
|
Ted Harris
|
| |
$0
|
| |
$449,444
|
| |
$0
|
| |
$4,404,848
|
|
|
Martin Bengtsson
|
| |
$0
|
| |
$0
|
| |
$0
|
| |
$0
|
|
|
Frederic Boned
|
| |
$0
|
| |
$0
|
| |
$0
|
| |
$0
|
|
|
Hatsuki Miyata
|
| |
$0
|
| |
$0
|
| |
$0
|
| |
$0
|
|
|
Martin Reid
|
| |
$0
|
| |
$0
|
| |
$0
|
| |
$0
|
|
(1)
|
NEO contributions include any deferrals of annual compensation, including
earned awards under the ICP. These amounts are included in the NEOs’ compensation under either “Salary” or “Non-Equity Incentive Compensation”.
|
|
Benefits and Payments Upon Termination(1)
|
| ||||||||||||
|
Event
|
| |
Base
Salary
|
| |
ICP
Bonus(2)
|
| |
Acceleration of
Vesting Stock
Options and
Restricted
Shares(3)
|
| |
Total
|
|
|
Voluntary termination by Mr. Harris, upon Mr. Harris’ death or termination
for Cause(4)
|
| |
$0
|
| |
$1,219,937
|
| |
$0
|
| |
$1,219,937
|
|
|
Termination by the Company for other than Cause, Mr. Harris’ death or in
response to a notice from that he intends to terminate the Harris Agreement or by Mr. Harris for Good Reason(5)
|
| |
$2,310,000
|
| |
$1,219,937
|
| |
$0
|
| |
$3,529,937
|
|
|
Termination by Company prior to the second anniversary of a Change in Control
for other than for Cause, Mr. Harris’ death or in response to a notice from that he intends to terminate the Harris Agreement
|
| |
$2,310,000
|
| |
$1,219,937
|
| |
$9,921,015
|
| |
$13,450,952
|
|
|
Voluntary termination by Mr. Harris prior to the second anniversary of a
Change in Control
|
| |
$1,155,000
|
| |
$1,219,937
|
| |
$9,921,015
|
| |
$12,295,952
|
|
(1)
|
Table assumes termination occurred on December 31, 2023, and, in the case of
events following a Change in Control, that the Change in Control occurred during 2023.
|
(2)
|
Represents the ICP Bonus earned by Mr. Harris in fiscal year 2023.
|
(3)
|
While the Harris Agreement does not call for the acceleration of equity
(other than the Equity Replacement Shares (as defined therein) which such Equity Replacement Shares vested by their own terms in 2016 and 2017), under the Amended 2017 Plan, the Compensation Committee has discretionary authority to
determine the treatment of awards thereunder and the Amended 2017 Plan calls for the acceleration of equity grants as described in the narrative above in the event of a Change in Control (as defined in the Amended 2017 Plan). Amounts in
this column are calculated by: (i) multiplying the number of shares subject to accelerated vesting (all Time-Based Restricted Shares being accelerated, and the target level of Performance Shares being accelerated) by $148.75, which is
the closing market price per share of our Common Stock on December 29, 2023, and (ii) the difference between (x) the per share grant price of the accelerated Stock Options and (y) $148.75, which is the closing market price per share of
our Common Stock on December 29, 2023.
|
(4)
|
Under the Harris Agreement, “Cause” means: habitual absence or lateness;
gross insubordination or material violation of published material Company policies; failure to devote full time to the Company’s business; failure to comply with the obligations of confidentiality, non-competition and non-solicitation
of the Company’s clients, customers and employees; any action which constitutes a violation of any applicable criminal statute; or any act which frustrates or violates the fiduciary duties owed by Mr. Harris to the Company.
|
(5)
|
Under the Harris Agreement, “Good Reason” will have occurred if Mr. Harris
terminates his employment within twelve months after he has been demoted from his position as President and Chief Executive Officer or shall otherwise have suffered by reason of the Company’s intentional actions regarding the terms and
nature of his employment such a fundamental change in his employment as to effectively amount to a “constructive termination” of his employment with Company (but he shall not in fact have been discharged from such employment), including
a reduction of his base annual salary, or a diminution in his duties or responsibilities.
|
|
Plan Category
|
| |
Number of
Shares to be
Issued Upon
Exercise of
Outstanding
Options,
Warrants
and Rights
|
| |
Weighted-Average
Exercise Price Per
Share of
Outstanding
Options, Warrants
and Rights
|
| |
Number of
Shares Remaining
Available for
Future Issuance
Under Equity
Compensation
Plans (Excluding
Shares Reflected
in Column)(1)
|
|
|
Equity compensation plans approved by security holders
|
| |
1,077,840
|
| |
104.38
|
| |
1,034,260
|
|
|
Equity compensation plans not approved by security holders
|
| | | | | | | |||
|
Total
|
| |
1,077,840
|
| |
104.38
|
| |
1,034,260
|
|
(1)
|
10,813 shares of unvested Time-Based Restricted Shares granted to
non-employee directors and 86,227 shares of unvested Time-Based Restricted Shares granted to NEOs are excluded from this table.
|
| Year | | | Summary Compensation Table Total for Ted Harris(1) $ | | | Compensation Actually Paid to Ted Harris(2)(2a) $ | | | Average Summary Compensation Table Total for Non-CEO NEOs(3) $ | | | Average Compensation Actually Paid to Non-CEO NEOs(2)(2a)(3) $ | | | Year-end value of $100 invested on 12/31/2019 in(4): | | | Net Income ($) (in millions) $ | | | Adjusted EBITDA(6) (in millions) $ | | |||
| BCPC $ | | | Peer Group Total Shareholder Return $ | | |||||||||||||||||||||
| 2023 | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2022 | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2021 | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2020 | | | | | | | | | | | | | | | | | | | | | | | | | |
1. | The PEO for all four fiscal years is |
2. | CAP for the PEO and average CAP for our other NEOs in each of 2023, 2022, 2021 and 2020 reflect the respective amounts set forth in the table above, adjusted as set forth in the table below, as determined in accordance with SEC rules. CAP values reflected in the table above do not reflect the actual amount of compensation earned by or paid to the PEO and our other NEOs during the applicable year. For information regarding the decisions made by our Executive Compensation Committee in regards to the PEO and our other NEOs’ compensation for fiscal year 2023, see the section titled “Compensation Discussion and Analysis” of this proxy statement. |
| | | 2023 | | | 2022 | | | 2021 | | | 2020 | | |||||||||||||
| | | Harris, Ted | | | Average Non-CEO NEOs | | | Harris, Ted | | | Average Non-CEO NEOs | | | Harris, Ted | | | Average Non-CEO NEOs | | | Harris, Ted | | | Average Non-CEO NEOs | | |
| Total Compensation from Summary Compensation Table | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
| Adjustments for Equity Awards | | | | | | | | | | | | | | | | | | ||||||||
| Adjustment for grant date values in the Summary Compensation Table | | | $( | | | $( | | | $( | | | $( | | | $( | | | $( | | | $( | | | $( | |
| Year-end fair value of unvested awards granted in the current year | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
| Year-over-year difference of year-end fair values for unvested awards granted in prior years | | | $ | | | $ | | | $( | | | $( | | | $ | | | $ | | | $ | | | $ | |
| Fair values at vest date for awards granted and vested in current year | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
| Difference in fair values between prior year-end fair values and vest date fair values for awards granted in prior years | | | $ | | | $ | | | $( | | | $( | | | $ | | | $ | | | $ | | | $ | |
| | | 2023 | | | 2022 | | | 2021 | | | 2020 | | |||||||||||||
| | | Harris, Ted | | | Average Non-CEO NEOs | | | Harris, Ted | | | Average Non-CEO NEOs | | | Harris, Ted | | | Average Non-CEO NEOs | | | Harris, Ted | | | Average Non-CEO NEOs | | |
| Forfeitures during current year equal to prior year-end fair value | | | $ | | | $ | | | $( | | | $( | | | $ | | | $ | | | $ | | | $ | |
| Dividends or dividend equivalents not otherwise included in total compensation | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
| Total Adjustments for Equity Awards | | | $ | | | $ | | | $( | | | $( | | | $ | | | $ | | | $ | | | $ | |
| Compensation Actually Paid (as calculated) | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
(2a) | The following summarizes the valuation assumptions used for stock option awards included as part of Compensation Actually Paid: |
(3) | Non-CEO NEOs reflect the average Summary Compensation Table total compensation and average Compensation Actually Paid for the following executives by year: |
(4) | TSR is cumulative (assuming $100 was invested on December 31, 2019) for the measurement periods beginning on December 31, 2019 and ending on December 31 of each of 2023, 2022, 2021 and 2020, respectively, calculated in accordance with Item 201(e) of Regulation S-K. The peer group for purposes of this table is the Dow Jones U.S. Specialty Chemicals Index. Historic stock price performance is not necessarily indicative of future stock performance. |
(5)
|
Reflects “Net Earnings” in the Company’s Consolidated Statements of Earnings included in the Company’s Annual
Reports on Form 10-K for each of the years ended December 31, 2023, 2022, 2021 and 2020.
|
(6) | |
| Company Performance Metrics(1) | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | |
(1)
|
For further information regarding these company performance metrics and their
function in the Company’s executive compensation program, please see the “Compensation Discussion and Analysis” section of this Proxy Statement.
|
|
Name and Address of Beneficial Owner
|
| |
Amount
and
Nature of
Beneficial
Ownership
|
| |
Beneficially
Owned(1)
|
| |
Percent of
Class(2)
|
|
|
BlackRock, Inc.
50 Hudson Yards, New York, NY 10001
|
| |
(3)
|
| |
4,989,247
|
| |
15.39%
|
|
|
The Vanguard Group, Inc.
100 Vanguard Blvd., Malvern, PA 19355
|
| |
(4)
|
| |
3,791,512
|
| |
11.69%
|
|
|
APG Asset Management US Inc.
666 Third Ave, 2nd
Floor, New York, NY 10017
|
| |
(5)
|
| |
2,917,112
|
| |
9.00%
|
|
|
Wasatch Advisors LP
505 Wakara Way, Salt Lake City, UT 84108
|
| |
(6)
|
| |
1,910,409
|
| |
5.89%
|
|
|
Ted Harris
|
| |
(7)
|
| |
183,572
|
| |
*
|
|
|
Martin Bengtsson
|
| |
(8)
|
| |
49,887
|
| |
*
|
|
|
David Fischer
|
| |
(9)
|
| |
25,876
|
| |
*
|
|
|
Matthew Wineinger
|
| |
(10)
|
| |
18,029
|
| |
*
|
|
|
Daniel Knutson
|
| |
(11)
|
| |
16,916
|
| |
*
|
|
|
Martin Reid
|
| |
(12)
|
| |
11,960
|
| |
*
|
|
|
Joyce Lee
|
| |
(13)
|
| |
7,673
|
| |
*
|
|
|
Hatsuki Miyata
|
| |
(14)
|
| |
1,702
|
| |
*
|
|
|
Kathleen Fish
|
| |
(15)
|
| |
1,406
|
| |
*
|
|
|
Frederic Boned
|
| |
(16)
|
| |
806
|
| |
*
|
|
|
Olivier Rigaud
|
| |
(17)
|
| |
0
|
| |
*
|
|
|
Monica Vicente
|
| |
(18)
|
| |
0
|
| |
*
|
|
|
Directors and Executive Officers as a Group (16 people)
|
| | | |
403,951
|
| |
1.25%
|
| |
| | | | | | | | ||||
|
Shares Outstanding as of April 22, 2024
|
| | | |
32,423,468
|
| | |
*
|
Less than 1%
|
(1)
|
Beneficial ownership is determined in accordance with the rules of the SEC
and generally includes voting or investment power with respect to securities. In accordance with SEC rules, shares which are vesting within 60 days of the Record Date or which may be acquired upon exercise of stock options which are
currently exercisable, or which become exercisable within 60 days after the date of the information in the table are deemed to be beneficially owned. Except as indicated by footnote, and subject to community property laws where
applicable, to the Company’s knowledge, the persons or entities named in the table above are believed to have sole voting and investment power with respect to all shares of Common Stock shown as beneficially owned by them.
|
(2)
|
The ownership percentages set forth in this column are based on the Company’s
outstanding shares on the Record Date and assumes that each of the beneficial owners continued to own the number of shares reflected in the table above on such date.
|
(3)
|
Based upon information provided in a Schedule 13G/A for such entity filed
with the SEC on January 22, 2024, reporting beneficial ownership as of December 31, 2023, with sole dispositive power as to all shares and sole voting power as to 4,935,576 shares.
|
(4)
|
Based upon information provided in a Schedule 13G/A for such entity filed
with the SEC on February 13, 2024, reporting beneficial ownership as of December 29, 2023, with sole dispositive power as to 3,698,113 shares, shared dispositive power of 93,399 shares, and shared voting power as to 59,244 shares.
|
(5)
|
Based upon information provided in a Schedule 13G/A for such entity filed
with the SEC on February 7, 2024, reporting beneficial ownership as of December 31, 2023, with shared dispositive and voting powers as to all shares.
|
(6)
|
Based upon information provided in a Schedule 13G/A filed with the SEC on
February 9, 2024, reporting beneficial ownership as of December 31, 2023, with sole dispositive and voting powers as to all shares.
|
(7)
|
Consists of 135,970 shares such person has the right to acquire pursuant to
Stock Options, 1,804 shares held in such person’s Company 401(k) retirement account, and 45,798 shares held directly.
|
(8)
|
Consists of 35,200 shares such person has the right to acquire pursuant to
Stock Options, 912 shares held in such person’s Company 401(k) retirement account and 13,775 shares held directly.
|
(9)
|
Consists of 13,446 shares such person has the right to acquire pursuant to Stock
Options, and 12,430 shares held directly.
|
(10)
|
Consists of 13,446 shares such person has the right to acquire pursuant to Stock
Options, and 4,583 shares held directly.
|
(11)
|
Consists of 13,446 shares such person has the right to acquire pursuant to Stock
Options, and 3,470 shares held directly.
|
(12)
|
Consists of 7,980 shares such person has the right to acquire pursuant to
Stock Options, 530 shares held in such person’s Company 401(k) retirement plan account and 3,450 shares held directly.
|
(13)
|
Consists of 6,476 shares such person has the right to acquire pursuant to Stock
Options and 1,197 shares held directly.
|
(14)
|
Consists of 520 shares such person has the right to acquire pursuant to Stock
Options, 331 shares held in such person’s Company 401(k) retirement plan account and 851 shares held directly.
|
(15)
|
Consists of 1,406 shares such person has the right to acquire pursuant to Stock
Options.
|
(16)
|
Consists of 520 shares such person has the right to acquire pursuant to Stock
Options, and 286 shares held in such person’s Company 401(k) retirement plan account.
|
| | |
2023
|
| |
2022
|
| |
|
Audit fees(1)
|
| |
$1,274,671
|
| |
$1,362,465
|
|
|
Audit-related fees(2)
|
| |
229,970
|
| |
316,136
|
|
|
Tax fees(3)
|
| |
8,400
|
| |
151,000
|
|
|
Total fees
|
| |
$1,513,041
|
| |
$1,829,601
|
|
(1)
|
Audit fees relate to audit of the annual consolidated financial statements
and quarterly reviews, including out of pocket disbursements and administrative charges, and fees related to foreign statutory audits. 2023 also includes fees related to S-8 filing.
|
(2)
|
Audit-related fees for 2023 consist of fees paid for the employee benefit
plan audit and fees paid for unconsummated acquisition financial due diligence procedures. Audit-related fees for 2022 consist of fees paid for the employee benefit plan audit and fees paid for financial due diligence procedures related
to consummated acquisitions.
|
(3)
|
Tax fees for 2023 consist of unconsummated acquisition tax due diligence
procedures. Tax fees for 2022 consist of tax due diligence procedures related to consummated acquisitions.
|
|
|
| |
/s/ Hatsuki Miyata
|
|
|
|
| |
|
|
|
|
| |
Hatsuki Miyata
General Counsel and Secretary
|
|
|
|
| |
April 26, 2024
|
|
|
|
| |
|
|
|
|
| |
Montvale, New Jersey
|
|
| | |
Year Ended
December 31,
|
| ||||
| | |
2023
|
| |
2022
|
| |
|
Reconciliation of adjusted net earnings
|
| | | | | ||
|
GAAP net earnings
|
| |
$ 108,543
|
| |
$105,367
|
|
|
Inventory valuation adjustment(1)
|
| |
1,419
|
| |
3,057
|
|
|
Amortization of intangible assets and finance lease(2)
|
| |
28,561
|
| |
27,816
|
|
|
Restructuring costs(3)
|
| |
8,365
|
| |
—
|
|
|
Transaction and integration costs and unallocated legal fees(4)
|
| |
(9,683)
|
| |
3,109
|
|
|
Net realized gain on foreign currency forward contracts(5)
|
| |
—
|
| |
(512)
|
|
|
Income tax adjustment(6)
|
| |
(7,487)
|
| |
(8,306)
|
|
|
Adjusted net earnings
|
| |
$129,718
|
| |
$130,531
|
|
|
Adjusted net earnings per common share - diluted
|
| |
$ 4.00
|
| |
$4.03
|
|
| | |
Year Ended
December 31,
|
| ||||
| | |
2023
|
| |
2022
|
| |
|
Net income - as reported
|
| |
$ 108,543
|
| |
$ 105,367
|
|
|
Add back:
|
| | | | | ||
|
Provision for income taxes
|
| |
28,718
|
| |
28,382
|
|
|
Interest and other expenses
|
| |
21,932
|
| |
11,437
|
|
|
Depreciation and amortization
|
| |
54,647
|
| |
51,513
|
|
|
EBITDA
|
| |
213,840
|
| |
196,699
|
|
|
Add back certain items:
|
| | | | | ||
|
Non-cash compensation expense related to equity awards
|
| |
16,052
|
| |
13,224
|
|
|
Inventory valuation adjustment(1)
|
| |
1,419
|
| |
3,057
|
|
|
Restructuring costs(3)
|
| |
8,365
|
| |
—
|
|
|
Transaction and integration costs and unallocated legal fees(4)
|
| |
(9,683)
|
| |
3,109
|
|
|
Nonqualified deferred compensation plan expense (income)(7)
|
| |
917
|
| |
(401)
|
|
|
Adjusted EBITDA
|
| |
$230,910
|
| |
$215,688
|
|
(1)
|
Inventory valuation adjustment: Business combination accounting
principles require us to measure acquired inventory at fair value. The fair value of inventory reflects the acquired company’s cost of manufacturing plus a portion of the expected profit margin. The non-GAAP adjustment to our cost of
sales excludes the expected profit margin component that is recorded under business combination accounting principles. We believe the adjustment is useful to investors as an additional means to reflect cost of sales and gross margin
trends of our business.
|
(2)
|
Amortization of intangible assets and finance lease: Amortization of
intangible assets and finance lease consists of amortization of customer relationships, trademarks and trade names, developed technology, regulatory registration costs, patents and trade secrets, capitalized loan issuance costs, other
intangibles acquired primarily in connection with business combinations, an intangible asset in connection with a company-wide ERP system implementation, and one finance lease. We record expense relating to the amortization of these
intangibles and finance lease in our GAAP financial statements. Amortization expenses for our intangible assets and finance lease are inconsistent in amount and are significantly impacted by the timing and valuation of an acquisition.
Consequently, our non-GAAP adjustments exclude these expenses to facilitate an evaluation of our current operating performance and comparisons to our past operating performance.
|
(3)
|
Restructuring costs: Expenses related to a reorganization of the
business.
|
(4)
|
Transaction and integration costs and unallocated legal fees:
Transaction and integration costs related to acquisitions and divestitures are expensed in our GAAP financial statements. Unallocated legal fees for transaction-related non-compete agreement disputes are expensed in our GAAP financial
statements. Management excludes these items for the purposes of calculating Adjusted EBITDA and other non-GAAP financial measures. We believe that excluding these items from our non-GAAP financial measures is useful to investors because
these are items associated with transactions that are inconsistent in amount and frequency causing comparison of current and historical financial results to be difficult.
|
(5)
|
Net realized gain on foreign currency exchange forward contracts: The
net realized gain on foreign currency exchange forward contracts related to four short-term foreign currency exchange forward contracts with JP Morgan Chase, N.A. in connection with the Kappa acquisition. These contracts did not qualify
for hedge accounting and the net gain was recorded as other income in our GAAP financial statements. We believe that excluding the gain from our Non-GAAP financial measures is useful to investors because such income is inconsistent in
amount and frequency causing comparison of current and historical financial results to be difficult.
|
(6)
|
Income tax adjustment: For purposes of calculating adjusted net
earnings and adjusted diluted earnings per share, we adjust the provision for (benefit from) income taxes to tax effect the taxable and deductible non-GAAP adjustments described above as they have a significant impact on our income tax
(benefit) provision. Additionally, the income tax adjustment is adjusted for the impact of adopting ASU 2016-09, “Improvements to Employee Share-Based Payment Accounting” and uses our non-GAAP effective rate applied to both our GAAP
earnings before income tax expense and non-GAAP adjustments described above. See Table 3 for the calculation of our non-GAAP effective tax rate.
|
(7)
|
Nonqualified deferred compensation plan (income) expense: Gains and
losses on rabbi trust assets related to our nonqualified deferred compensation plan are recorded in other (income) expense while the offsetting increases or decreases to the deferred compensation liability are recorded within earnings
from operations. The increases and decreases in the deferred compensation liability are driven by market volatility and are not a true reflection of company performance. We believe excluding these amounts from our non-GAAP financial
measures is useful to investors because these items are inconsistent in amount based on market conditions causing comparison of current and historical financial results to be difficult. Adjustments have been made to the prior period
(2022) to conform with the current period (2023).
|