UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

SCHEDULE 14A

 

Proxy Statement Pursuant to Section 14(a) of

the Securities Exchange Act of 1934 (Amendment No.     )

 

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Filed by a Party other than the Registrant o

 

Check the appropriate box:

 

o  Preliminary Proxy Statement

o  Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

þ  Definitive Proxy Statement

o  Definitive Additional Materials

o  Soliciting Material Pursuant to § 240.14a-12

 

Monster Worldwide, Inc.

(Name of Registrant as Specified In Its Charter)

 

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

 

Payment of Filing Fee (Check the appropriate box):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

April 29, 2009

 

Dear Stockholder:

 

You are cordially invited to attend our Annual Meeting of Stockholders to be held at 10:00 a.m. on Monday, June 22, 2009, at the offices of Dechert LLP, 1095 Avenue of the Americas, 28th Floor, New York, New York 10036. You will need to provide valid government-issued photo identification, such as a driver’s license or passport, to gain entry to the Annual Meeting.

 

At the Annual Meeting, you will be asked to elect seven directors from among the nominees described in the enclosed Proxy Statement, approve an amendment to the Company’s 2008 Equity Incentive Plan to increase the number of shares authorized for issuance under the Plan and ratify the appointment of BDO Seidman, LLP as our independent registered public accounting firm. In addition, we will be pleased to report on the affairs of the Company and a discussion period will be provided for questions and comments of general interest to stockholders.

 

We look forward to greeting personally those stockholders who are able to be present at the Annual Meeting; however, whether or not you plan to be with us at the Annual Meeting, it is important that your shares be represented. Accordingly, you are requested to vote at your earliest convenience. You may vote by Internet or telephone. If you received a printed copy of the proxy materials, you may also vote by mail by signing, dating and returning the enclosed proxy card.

 

Thank you for your cooperation.

 

Very truly yours,

 

SALVATORE IANNUZZI
Chairman of the Board of Directors, President
and Chief Executive Officer

MONSTER WORLDWIDE, INC.
622 THIRD AVENUE, 39TH FLOOR
NEW YORK, NEW YORK 10017
(212) 351-7000

 

 

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

 

 

 

The 2009 Annual Meeting of Stockholders of Monster Worldwide, Inc. will be held on Monday, June 22, 2009 at 10:00 a.m. at the offices of Dechert LLP, 1095 Avenue of the Americas, 28th Floor, New York, New York 10036 for the following purposes:

 

(1) To elect seven directors from among the nominees described in this Proxy Statement;

 

(2) To approve an amendment to the Monster Worldwide, Inc. 2008 Equity Incentive Plan to increase the number of shares authorized for issuance under the Plan;

 

(3) To ratify the appointment of BDO Seidman, LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2009; and

 

(4) To transact such other business as may properly come before the Annual Meeting or any postponement or adjournment thereof.

 

All stockholders of record at the close of business on April 23, 2009 will be entitled to notice of and to vote at the Annual Meeting or any postponements or adjournments thereof. You will need to provide valid government-issued photo identification, such as a driver’s license or passport, to gain entry to the Annual Meeting.

 

Whether or not you plan to be with us at the Annual Meeting, it is important that your shares be represented. Accordingly, you are requested to vote at your earliest convenience. You may vote by Internet or telephone. If you received a printed copy of the proxy materials, you may also vote by mail by signing, dating and returning the enclosed proxy card. Voting now will not limit your right to change your vote or to attend the Annual Meeting.

 

MICHAEL C. MILLER
Executive Vice President, General
Counsel and Secretary

TABLE OF CONTENTS

 

 

PROXY STATEMENT

 

 

This Proxy Statement contains information relating to the 2009 Annual Meeting of Stockholders of Monster Worldwide, Inc. (referred to in this Proxy Statement as “we,” “Monster” or the “Company”) to be held on Monday, June 22, 2009, beginning at 10:00 a.m. at the offices of Dechert LLP, 1095 Avenue of the Americas, 28th Floor, New York, New York 10036, and at any postponements or adjournments thereof.

 

We are mailing a printed copy of this Proxy Statement, a proxy card and the 2008 Annual Report of the Company to certain stockholders and a Notice Regarding the Availability of Proxy Materials (the “Notice of Internet Availability”) to other stockholders beginning on or around April 29, 2009. The Annual Report being made available on the Internet and mailed with the Proxy Statement is not part of the proxy-soliciting materials.

 

What is the purpose of the Annual Meeting?

 

At our Annual Meeting, stockholders will act upon the matters outlined in the Notice of Annual Meeting of Stockholders on the cover page of this Proxy Statement, consisting of the election of directors from among the nominees described in this Proxy Statement, the approval of an amendment to the Company’s 2008 Equity Incentive Plan to increase the number of shares authorized for issuance under the Plan and the ratification of the appointment of BDO Seidman, LLP as our independent registered public accounting firm. In addition, management will report on the performance of the Company during 2008 and respond to questions from stockholders. The Board of Directors is not currently aware of any other matters that will come before the Annual Meeting.

 

Proxies for use at the Annual Meeting are being solicited by the Board of Directors of the Company. Should it appear desirable to do so in order to ensure adequate representation of shares at the Annual Meeting, officers and employees of the Company may communicate with stockholders, banks, brokerage houses and others by telephone, in writing or in person to request that proxies be furnished. All expenses incurred in connection with this solicitation will be borne by the Company. We have engaged Innisfree M&A Incorporated to assist in the distribution of proxy materials and the solicitation of proxies. We will pay Innisfree a fee of $15,000 plus customary costs and expenses for these services. The Company has agreed to indemnify Innisfree against certain liabilities arising out of or in connection with its engagement.

 

Who is entitled to vote at the Annual Meeting?

 

Only stockholders of record at the close of business on April 23, 2009, the record date for the Annual Meeting, are entitled to receive notice of and to vote at the Annual Meeting, or any postponements or adjournments thereof. If you were a stockholder of record on that date, you will be entitled to vote all of the shares you held on that date at the Annual Meeting, or any postponements or adjournments of the Annual Meeting.

 

What are the voting rights of the holders of common stock?

 

On April 23, 2009, there were 126,047,291 shares of common stock outstanding. Each outstanding share of common stock will be entitled to one vote on each matter acted upon.

 

What constitutes a quorum?

 

The presence at the Annual Meeting, in person or by proxy, of the holders of a majority of the issued and outstanding shares of common stock entitled to vote at the Annual Meeting shall constitute a quorum for the transaction of business at the Annual Meeting.

How do I vote?

 

If you are a registered stockholder, you can vote your shares in two ways: either by proxy or in person at the Annual Meeting by written ballot. If you choose to vote by proxy, you may do so by Internet or telephone or, if you received a printed copy of your proxy materials, by mail. Each of these procedures is more fully explained below. Even if you plan to attend the Annual Meeting, the Board of Directors recommends that you vote by proxy. If you hold your shares through a broker or other nominee or if you hold your shares through the Monster Worldwide, Inc. 401(k) Savings Plan (the “401(k) Plan”), please refer to the voting procedures described below.

 

Vote by Internet

 

You can vote your shares by Internet on the voting website, which is www.proxyvote.com. Internet voting is available 24 hours a day, seven days a week, until 11:59 p.m. (Eastern Daylight Time) on Sunday, June 21, 2009. You will have the opportunity to confirm that your instructions have been properly recorded. Our Internet voting procedures are designed to authenticate stockholders through individual control numbers. If you received a proxy card in the mail but choose to vote by the Internet, you do not need to return your proxy card.

 

Vote by Telephone

 

You can also vote your shares by telephone by calling the toll-free number provided on the voting website, which is www.proxyvote.com, and on the proxy card. Telephone voting is available 24 hours a day, seven days a week, until 11:59 p.m. (Eastern Daylight Time) on Sunday, June 21, 2009. Voice prompts will allow you to vote your shares and confirm that your instructions have been properly recorded. Our telephone voting procedures are designed to authenticate stockholders through individual control numbers. If you received a proxy card in the mail but choose to vote by telephone, you do not need to return your proxy card.

 

Vote by Mail

 

If you received a printed copy of your proxy materials, you can vote by completing and mailing the enclosed proxy card to us so that we receive it before 11:59 p.m. (Eastern Daylight Time) on Sunday, June 21, 2009. If you received a Notice of Internet Availability, you can request a printed copy of your proxy materials by following the instructions contained in the notice.

 

Voting at the Annual Meeting

 

If you wish to vote at the Annual Meeting, written ballots will be available at the Annual Meeting. If your shares are held in the name of a bank, broker or other holder of record, you must obtain a proxy, executed in your favor, from the holder of record to be able to vote at the Annual Meeting. Voting by proxy, whether by Internet, telephone or mail, will not limit your right to vote at the Annual Meeting if you decide to attend in person. However, if you vote by proxy and also attend the Annual Meeting, there is no need to vote again at the Annual Meeting unless you wish to change your vote.

 

Voting for Stockholders that Hold Shares Through a Broker or Nominee

 

If you hold shares through a broker or other nominee, you may instruct your broker or other nominee to vote your shares by following the instructions that the broker or nominee provides to you with these materials. Most brokers offer the ability to provide voting instructions by Internet, telephone and mail.

 

Voting for 401(k) Plan Participants

 

Each participant in the 401(k) Plan is entitled to direct the trustee of the 401(k) Plan to vote the shares of our common stock attributable to the participant’s account in the 401(k) Plan. The trustee of our 401(k) Plan is Charles Schwab. Participants in the 401(k) Plan should have received instructions with their proxy materials explaining how the participants can vote the shares of our common stock attributable to their accounts in the 401(k) Plan. Please read the instructions carefully, as the deadline for voting shares held in the 401(k) Plan is Wednesday, June 17, 2009. Votes are tabulated by Broadridge Financial Solutions, an independent third party. Each participant’s votes are

confidential and will not be divulged by the trustee or Broadridge Financial Solutions to any person, including officers and employees of the Company. The trustee will vote the shares held by the 401(k) Plan on the basis of the final tabulation results. As a general rule, shares of our common stock held in the 401(k) Plan for which no instructions are received will be voted by the trustee in the same proportion as the shares of our common stock for which voting instructions have been received, subject to compliance with the requirements of the Employee Retirement Income Security Act of 1974, as amended, one of the federal laws applicable to the 401(k) Plan.

 

Can I change my vote?

 

If you are a registered stockholder, you can revoke your proxy at any time before it is exercised at the Annual Meeting by taking any one of the following actions: (1) you can deliver a valid written proxy with a later date or follow the instructions given for changing your vote by Internet or telephone; (2) you can notify the Secretary of the Company in writing that you have revoked your proxy (using the address in the Notice of Annual Meeting of Stockholders above); or (3) you can vote in person by written ballot at the Annual Meeting.

 

What do I need to do to attend the Annual Meeting?

 

You will need to provide valid government-issued photo identification, such as a driver’s license or passport, to gain entry to the Annual Meeting.

 

What are the Board of Directors’ recommendations?

 

The Board of Directors recommends you vote in favor of:

 

 

What vote is required to approve each item?

 

The seven nominees receiving the highest number of affirmative votes of the total votes cast at the Annual Meeting, either in person or by proxy, shall be elected as directors.

 

Our Corporate Governance Guidelines set forth our procedures if a nominee receives more “withhold authority” votes than affirmative votes for his or her election. A nominee for director who receives a greater number of “withhold authority” votes from his or her election than affirmative votes for such election is required to tender his or her resignation to the Chairman of the Board of Directors following certification of the stockholder vote. The Corporate Governance and Nominating Committee is required to consider the offer to resign and recommend to the Board of Directors what action the Corporate Governance and Nominating Committee believes should be taken in response to the offered resignation. The Board of Directors is required to take action with respect to this recommendation within 90 days following certification of the stockholder vote. The Board of Directors will then disclose its decision whether to accept the resignation offer, in a Form 8-K to be filed or furnished with the U.S. Securities and Exchange Commission (“SEC”).

 

Approval of the amendment to the Monster Worldwide, Inc. 2008 Equity Incentive Plan and the ratification of the appointment of our independent registered public accounting firm requires the affirmative vote cast FOR each proposal at the Annual Meeting by the majority of the shares present in person or by proxy and entitled to vote thereon.

 

What is the effect of abstentions and broker non-votes?

 

With respect to the election of directors, stockholders may vote in favor of or withhold their votes for each nominee. There is no box to “abstain,” but withholding authority to vote for a nominee is the equivalent of abstaining. With respect to any proposal other than the election of directors, stockholders may vote in favor of or

against the proposal, or abstain from voting. Abstentions will be treated as the equivalent of a negative vote for the purpose of determining whether a proposal has been adopted.

 

Brokers who hold shares of common stock for the accounts of their clients must vote such shares as directed by their clients. If brokers do not receive instructions from their clients, the brokers may vote the shares in their own discretion in certain circumstances. Brokers are permitted to vote their clients’ shares in their own discretion as to the election of directors and the ratification of accountants. Other proposals are “non-discretionary” and brokers who have received no instructions from their clients do not have discretion to vote on those items. When a broker votes a client’s shares on some but not all of the proposals at a meeting, the missing votes are referred to as “broker non-votes.” The Company will count the shares represented by broker non-votes in determining whether there is a quorum. Broker non-votes will have no effect on the outcome of the vote for Proposal No. 2.

 

What happens if additional matters are presented at the Annual Meeting?

 

We do not know of any business or proposals to be acted upon at the Annual Meeting other than the items described in this Proxy Statement. If any other business is properly brought before the Annual Meeting or any postponement or adjournment thereof, it is the intention of the named proxies to vote on such matters in accordance with their best judgment.

 

What if I am a registered stockholder and I provide a proxy but do not provide specific voting instructions?

 

Proxies of registered stockholders that do not contain voting instructions for one or more items will be voted with respect to those items as follows: (1) FOR the election of all director nominees described in this Proxy Statement; (2) FOR approval of the amendment to the Monster Worldwide, Inc. 2008 Equity Incentive Plan to increase the number of shares authorized for issuance under the Plan; (3) FOR the ratification of the appointment of BDO Seidman, LLP as our independent registered public accounting firm; and (4) in accordance with the best judgment of the named proxies on any other matters properly brought before the Annual Meeting.

 

Who will count the votes?

 

We have hired a third party, Broadridge Financial Solutions, to be the inspector of elections and tabulate the votes cast at the Annual Meeting.

 

Where can I find the voting results of the Annual Meeting?

 

We will announce preliminary voting results at the Annual Meeting and will publish final results in our quarterly report on Form 10-Q for the second quarter ending June 30, 2009.

 

Our Board of Directors is committed to adopting and adhering to sound corporate governance principles. Having such principles is essential to operating our business efficiently and to maintaining our integrity and reputation in the marketplace. Reflecting its commitment to continuous improvement, the Board of Directors reviews its governance practices on an ongoing basis to ensure that they promote stockholder value.

 

How are nominees for election to our Board of Directors selected?

 

The Corporate Governance and Nominating Committee recommends to the Board of Directors individuals as nominees for election to the Board of Directors at annual meetings of the Company’s stockholders and to fill any vacancy or newly created directorship on the Board of Directors. The Corporate Governance and Nominating Committee does not have specific minimum qualifications that must be met by a candidate in order to be considered for nomination to the Board of Directors. In identifying and evaluating nominees for director, the Corporate Governance and Nominating Committee considers each candidate’s experience, integrity, background and skills, as well as other qualities that the candidate may possess and factors that the candidate may be able to bring to the Board of Directors. In accordance with its charter and with our Corporate Governance Guidelines, the Corporate Governance and Nominating Committee endeavors to ensure that two-thirds of the Company’s Board of Directors consists of independent directors as defined in

both the New York Stock Exchange Listed Company Manual (the “NYSE Listed Company Manual”) and in our Corporate Governance Guidelines. The Corporate Governance and Nominating Committee’s charter and our Corporate Governance Guidelines are available through the “Corporate Governance” section of our company website. Our company website is located at http://corporate.monster.com and the “Corporate Governance” section is located at http://corporate.monster.com/Investor_Relations/corporate_governance.html.

 

The Corporate Governance and Nominating Committee will consider on an ongoing basis stockholder nominations as nominees for election to the Board of Directors. In evaluating such nominations, the Corporate Governance and Nominating Committee will use the same selection criteria the Corporate Governance and Nominating Committee uses to evaluate other potential nominees. Any stockholder may suggest a nominee by sending the following information to our Corporate Governance and Nominating Committee: (1) your name, mailing address and telephone number, (2) the suggested nominee’s name, mailing address and telephone number, (3) a statement whether the suggested nominee knows that his or her name is being suggested by you, (4) the suggested nominee’s resume or other description of his or her background and experience and (5) your reasons for suggesting that the individual be considered. The information should be sent to the Corporate Governance and Nominating Committee addressed as follows: Corporate Governance and Nominating Committee of the Board of Directors, Monster Worldwide, Inc., 622 Third Avenue, 39^th Floor, New York, New York 10017.

 

Stockholders who do not wish to follow the foregoing procedure but who wish instead to nominate directly one or more persons for election to the Board of Directors must comply with the procedures established by our by-laws. To be timely, the Company must receive such nomination for the 2010 Annual Meeting of Stockholders at its principal office at 622 Third Avenue, 39^th Floor, New York, New York 10017 no earlier than February 13, 2010 and no later than March 15, 2010. For more information on stockholder proposals, see “Stockholder Proposals and Communications” on page 52.

 

All seven of the director nominees identified in this Proxy Statement currently serve as directors of the Company and all have been recommended by our Corporate Governance and Nominating Committee to our Board of Directors for re-election. The Corporate Governance and Nominating Committee recommends candidates to the full Board of Directors after receiving input from all directors. The Corporate Governance and Nominating Committee members, other members of the Board of Directors and senior management discuss potential candidates during this search process.

 

Have there been any additions to the Board of Directors since the 2008 annual meeting of stockholders held in June 2008, and what was the process?

 

Since our 2008 annual meeting, the Board of Directors elected Roberto Tunioli to the Board of Directors effective September 23, 2008. Mr. Tunioli was recommended to the Corporate Governance and Nominating Committee by Salvatore Iannuzzi. The Corporate Governance and Nominating Committee members met or spoke with Mr. Tunioli to assess him as a director candidate. The Corporate Governance and Nominating Committee unanimously recommended to the full Board of Directors that Mr. Tunioli be elected as a director. The Board of Directors followed the Corporate Governance and Nominating Committee’s recommendation. The Company has not paid any fees to any third party for the identification or evaluation of the nominees for the Board of Directors.

 

Who are the current members of our Board of Directors, and which of the directors are standing for re-election?

 

The eight members of our Board of Directors on the date of this Proxy Statement are:

 

Salvatore Iannuzzi, Chairman

Robert J. Chrenc

John Gaulding

Edmund P. Giambastiani, Jr.

Ronald J. Kramer

David A. Stein

Roberto Tunioli

Timothy T. Yates

Messrs. Iannuzzi, Chrenc, Gaulding, Giambastiani, Kramer, Stein and Yates were elected by stockholders at the 2008 annual meeting of stockholders held in June 2008. As discussed above, Mr. Tunioli was elected by the Board of Directors during the period since the 2008 annual meeting.

 

Directors serve one-year terms (or shorter if appointed by the Board of Directors between annual meetings) and are elected annually. Accordingly, the current term of office of all of the Company’s directors expires at the Annual Meeting to be held on June 22, 2009. Mr. Stein will not be standing for re-election to the Board of Directors and his current term will expire at the Annual Meeting. The other seven directors are standing for re-election at the Annual Meeting.

 

How often did the Board of Directors meet during the year ended December 31, 2008?

 

During the year ended December 31, 2008, the Board of Directors held 12 meetings. Each director attended at least 75% of the total number of meetings of the Board of Directors and the committees on which he served.

 

What committees has the Board of Directors established?

 

The Board of Directors has standing Audit, Compensation and Corporate Governance and Nominating Committees and two special committees. The Board of Directors has adopted a written charter for each of the Audit, Compensation and Corporate Governance and Nominating Committees setting forth the roles and responsibilities of each committee. The charters are available through the “Corporate Governance” section of our company website. Our company website is located at http://corporate.monster.com and the “Corporate Governance” section is located at http://corporate.monster.com/Investor_Relations/corporate_governance.html.

 

Audit Committee.  The Audit Committee is charged with, among other things, the appointment of the independent registered public accounting firm for the Company, as well as discussing and reviewing with the independent registered public accounting firm the scope of the annual audit and results thereof, pre-approving the engagement of the independent registered public accounting firm for all audit-related services and permissible non-audit related services, and reviewing and approving all related-party transactions. The Audit Committee also reviews interim financial statements included in the Company’s quarterly reports and reviews documents filed with the SEC. The Board of Directors has determined that all members of the Audit Committee during 2008 and all current members of the committee are “independent,” as required by the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the NYSE Listed Company Manual and Monster’s own Corporate Governance Guidelines. The Board of Directors has determined that each of Ronald J. Kramer and Robert J. Chrenc qualifies as an “audit committee financial expert” as defined by Item 407(d) of Regulation S-K of the Exchange Act. Mr. Kramer serves as Chairman of the Audit Committee. During 2008, the Audit Committee met 10 times. The Audit Committee’s report begins on page 50.

 

Compensation Committee.  The Compensation Committee is charged with recommending to the Board of Directors the compensation for the Company’s executives and administering the Company’s stock incentive and benefit plans. The Compensation Committee is entitled to delegate any of its responsibilities to a subcommittee of the Compensation Committee to the extent consistent with our charter, by-laws, Corporate Governance Guidelines, applicable law and the NYSE Listed Company Manual.

 

The Board of Directors has determined that all members of the Compensation Committee during 2008 and all current members of the committee are “independent directors” as required by the NYSE Listed Company Manual and Monster’s own Corporate Governance Guidelines, “outside directors” as defined in Section 162(m) of the Internal Revenue Code of 1986, as amended, and “non-employee directors” as defined in Rule 16b-3 under the Exchange Act.

 

Membership on the Compensation Committee is determined by the Board of Directors. The Compensation Committee Chairman regularly reports on Compensation Committee actions and recommendations at Board of Directors meetings. Mr. Chrenc serves as Chairman of the Compensation Committee. During 2008, the Compensation Committee met 10 times.

The Compensation Committee’s report begins on page 20. Additional information on the Compensation Committee’s processes and procedures for consideration of executive compensation are addressed in “Compensation Discussion and Analysis,” which begins on page 11.

 

Corporate Governance and Nominating Committee.  The Corporate Governance and Nominating Committee is charged with assisting the Board of Directors in its selection of individuals as nominees for election to the Board of Directors at annual meetings of the Company’s stockholders and filling any vacancies or newly created directorships on the Board of Directors. The Corporate Governance and Nominating Committee is also responsible for general corporate governance matters, including making recommendations relating to our Corporate Governance Guidelines. The Board of Directors has determined that all members of the Corporate Governance and Nominating Committee during 2008 and all current members of the committee qualify as “independent,” as required by the Exchange Act, the NYSE Listed Company Manual and Monster’s own Corporate Governance Guidelines. Mr. Gaulding serves as Chairman of the Corporate Governance and Nominating Committee. During 2008, the Corporate Governance and Nominating Committee met 6 times.

 

Special Committees.  The Board of Directors established a Special Committee in 2006 to investigate the Company’s historical stock option practices. For a more complete description of the Special Committee’s investigation, see “Item 1A. Risk Factors” in Part I of the Company’s Form 10-K for the fiscal year ended December 31, 2008, filed with the SEC on February 12, 2009. The Board of Directors also established a Special Litigation Committee to investigate and take whatever action it deems appropriate with respect to the civil derivative actions relating to the Company’s historical stock option granting practices. The Company has settled the derivatives actions with the assistance of the Special Litigation Committee. For a more complete description of the derivative actions, see “Item 3. Legal Proceedings” in Part I of the Company’s Form 10-K for the fiscal year ended December 31, 2008, filed with the SEC on February 12, 2009.

 

Who are the members of the committees of the Board of Directors?

 

The table below provides the membership of each committee of the Board of Directors as of the date of this Proxy Statement:

 

 

 

 

Which directors has the Board of Directors determined to be independent?

 

Our Board of Directors has adopted director independence guidelines to assist in determining each director’s independence. These guidelines are set forth in our Corporate Governance Guidelines and are available through the “Corporate Governance” section of our company website. Our company website is located at http://corporate.monster.com and the “Corporate Governance” section is located at http://corporate.monster.com/Investor_Relations/corporate_governance.html. These guidelines identify categories of relationships that the Board of Directors has determined would affect a director’s independence. Under the Corporate Governance Guidelines, at least two-thirds of the Board of Directors shall consist of directors who satisfy the independence requirements of the Corporate Governance Guidelines and the NYSE Listed Company Manual.

 

The Board of Directors has analyzed the independence of each director nominee and determined that the following directors meet the standards of independence under our Corporate Governance Guidelines and the NYSE Listed Company Manual: Robert J. Chrenc, John Gaulding, Edmund P. Giambastiani, Jr., Ronald J. Kramer and Roberto Tunioli. Thus, five of the seven directors standing for re-election, and each member of the Audit, Compensation and Corporate Governance and Nominating Committees, meet the standards of independence under our Corporate Governance Guidelines and the NYSE Listed Company Manual.

 

In accordance with our Corporate Governance Guidelines, a majority of the independent directors of the Board of Directors has appointed Ronald J. Kramer as the lead independent director. The lead independent director is responsible for presiding over meetings of the independent directors, reviewing and approving agendas for meetings of the independent directors and facilitating communication between the independent directors and the Chief Executive Officer.

 

Is the Company aware of any Compensation Committee Interlocks?

 

None of the members of the Compensation Committee has been an officer of the Company and none were employees of the Company during 2008, and none had any direct or indirect material interest in or relationship with the Company or any of its subsidiaries. None of the executive officers of the Company has served on the board of directors or compensation committee of another company at any time during which an executive officer of such other company served on the Company’s Board of Directors or the Compensation Committee.

 

What is the Company’s policy regarding director attendance at Annual Meetings?

 

It is the policy of our Board of Directors that directors are encouraged to attend all annual stockholders meetings. All of the members of our Board of Directors then standing for re-election attended the 2008 annual meeting of stockholders.

 

How are directors compensated?

 

The compensation and benefit program for non-employee directors is designed to achieve the following goals: compensation should fairly pay non-employee directors for work required for the Company; compensation should align non-employee directors’ interests with the long-term interests of stockholders; and the structure of the compensation should be simple, transparent and easy for stockholders to understand. Employee directors receive no compensation for their service on the Board of Directors.

 

Effective January 1, 2009, each non-employee director of the Company receives an annual retainer of $40,000, except that the lead independent director receives an annual retainer of $60,000. The Chairman of each committee of the Board receives an additional retainer as follows: the Chairman of the Audit Committee receives an annual retainer of $50,000; the Chairman of the Compensation Committee receives an annual retainer of $35,000; and the Chairman of the Corporate Governance and Nominating Committee receives an annual retainer of $20,000. Each non-employee director of the Company that serves on a committee of the Board of Directors, but who is not the Chairman of such committee, receives an annual retainer as follows: the members of the Audit Committee receive an annual retainer of $25,000; the members of the Compensation Committee receive an annual retainer of $15,000; the members of the Corporate Governance and Nominating Committee receive an annual retainer of $10,000; and

the members of the Special Litigation Committee receive an annual retainer of $20,000. Each non-employee director also receives $2,500 for each meeting of the Board of Directors attended by telephone or in person.

 

During 2008, the annual retainers were the same as described above, except that the annual retainer for members of the Compensation Committee was $10,000, the annual retainer for the Chairman of the Compensation Committee was $30,000 and there was an annual retainer for members of the Special Committee of $20,000 through October 2008. During 2008, meeting attendance fees for non-employee directors were $1,000 for each meeting of the Board of Directors or a committee thereof attended by telephone or in person.

 

Pursuant to the Monster Worldwide, Inc. 2008 Equity Incentive Plan, the Board of Directors (or a designated committee thereof) determines on a discretionary basis what equity awards, if any, will be made to non-employee directors upon commencement of service as a non-employee director and what equity awards, if any, will be made to non-employee directors on an annual basis thereafter. The Corporate Governance and Nominating Committee, the designated committee, has determined that effective January 1, 2009, each new non-employee director will receive 7,500 shares of restricted stock upon commencement of service (of which 3,750 shares will be immediately vested upon grant and 3,750 shares will vest on the first anniversary of the date of grant), and each non-employee director who has served since the prior annual meeting of stockholders will receive 5,000 shares of restricted stock on the day following each annual meeting of stockholders (of which 2,500 shares will vest on each of the first and second anniversaries of the date of grant). During 2008, under the compensation and benefit program for non-employee directors then in effect, Admiral Giambastiani received an initial stock award of 5,000 shares (all of which is now vested), Mr. Tunioli received an initial award of 5,000 shares of restricted stock (of which 2,500 shares were immediately vested and the remaining 2,500 shares will vest in September 2009) and Messrs. Chrenc, Gaulding, Kramer and Stein received annual awards of 3,000 shares of restricted stock (of which 1,500 shares will vest on the date of the Annual Meeting and the remaining 1,500 shares will vest on the date of the 2010 annual meeting of stockholders).

 

The following table provides the compensation information for the year ended December 31, 2008 for each member of our Board of Directors who served as a non-employee director during 2008.

 

 

 

 

 

 

 

 

 

 

 

Compensation Discussion and Analysis

 

Overview

 

This compensation discussion and analysis explains how the Company determines the compensation that is paid to our Chairman, President and Chief Executive Officer (the “CEO”), Chief Financial Officer (the “CFO”) and certain other highly compensated people who served as members of our management team during the fiscal year ended December 31, 2008 (the “named executive officers” or “NEOs”). In 2008, our NEOs were: (a) Salvatore Iannuzzi, Chairman of the Board, President and CEO; (b) Timothy T. Yates, Executive Vice President and CFO; (c) Darko Dejanovic, Executive Vice President, Global Chief Information Officer and Head of Product; (d) James M. Langrock, Senior Vice President, Finance and Chief Accounting Officer; (e) Lise Poulos, Executive Vice President and Chief Administrative Officer; and (f) Mark Stoever, Executive Vice President, Corporate Development and Strategic Alliances.

 

What are the objectives of our compensation programs for executive officers and what are they designed to reward?

 

Our compensation program is based on three fundamental principles:

 

 

With respect to equity awards, in 2008 the Company and the Compensation Committee continued a practice of granting restricted stock to its NEOs, instead of equity awards that featured an exercise price. The Company and the Compensation Committee believed, and continue to believe, that issuing full value awards with a substantial vesting period of four years, not only encourages retention of key employees during the vesting period, but also aligns the goals of the NEOs with the Company’s emphasis on long-term goals. Accordingly, restricted stock was selected over other types of equity as the only form of equity award granted to NEOs by the Company in 2008. The Company further believes that since the value of equity awards increases and decreases with the value of our shares, such awards are inherently performance-oriented. Notwithstanding the foregoing, the Compensation Committee and its compensation consultant, in consultation with management and its compensation consultant, evaluate the Company’s compensation practices on a regular basis and may determine at some point in the future that awards with an exercise price as a component of total compensation may be appropriate and in the best interests of the Company.

 

Who is responsible for determining the compensation levels of executive officers?

 

The Compensation Committee recommends the compensation for the CEO, subject to approval by the independent members of the Board of Directors, and sets the compensation for the other NEOs and all other

executive officers. In recommending the CEO’s compensation and setting compensation for our other NEOs and other executive officers in 2008, the Compensation Committee conferred with our CEO and CFO (except that neither the CEO nor the CFO participates in discussions with respect to the determination of his compensation) and with the compensation and benefits professionals in the Company’s Human Resources Department. In addition, in performing its duties, the Compensation Committee periodically confers with an independent compensation consultant. The Compensation Committee engaged Hewitt Associates LLC (“Hewitt”) at the end of 2007 as its compensation consultant. In 2008, management engaged Buck Consultants, LLC (“Buck”) as its own compensation consultant. The Compensation Committee consulted with Hewitt and considered Buck’s recommendations periodically during 2008 with respect to certain compensation issues and in connection with the issuance of certain performance-based equity awards.

 

In determining compensation, the Compensation Committee reviews and assesses the operational and strategic goals of the Company, the performance of the Company, in part, based on specific measures and targets established by the Compensation Committee and the Board of Directors and the performance of the individual executive officers. From time to time, the Compensation Committee, in consultation with compensation consultants, also reviews and assesses the compensation paid to the senior executives of other large publicly-traded companies. Compensation is not driven entirely by formulas. Instead, Compensation Committee members may exercise discretion to reward individual performance in making their assessments. We believe this is important, as the Company’s ultimate focus on long-term results may not be reflected in the attainment of annual financial targets. Compensation Committee members participate in regular updates on our business priorities, strategies and results during which they interact with our executive officers.

 

As noted above, from time to time the Compensation Committee consults with its compensation consultant (currently Hewitt) about the competitive market for comparable executives. In this regard, in 2007 each member of the Compensation Committee and management was provided with information concerning the compensation practices of companies considered to be comparable to us. In 2008, the Compensation Committee and Hewitt determined that the data provided in 2007 was still valid and therefore no update was required. This information was used as a point of reference rather than as part of a formal benchmarking process to determine appropriate compensation. We believe that there are no companies that are exactly in our position. As a result, the companies that are part of our peer group are publicly-held companies that are only moderately similar to our Company. For example, our peer group includes companies that provide services over the internet, but that are not employment related businesses, companies that are comparable in size to us but are not employment related businesses and companies that connect both “buyers” and “sellers” of goods or services but which do not provide employment services. The Company and Hewitt determined that our peer group companies are: Akamai Technologies, Inc., CNET Networks, Inc., The Dun & Bradstreet Corporation, EarthLink, Inc., eBay Inc., Expedia, Inc., Getty Images, Inc., Google Inc., Meredith Corporation, Netflix, Inc., Orbitz Worldwide, Inc., priceline.com Incorporated, SAVVIS, Inc., United Online, Inc., ValueClick, Inc. and Yahoo! Inc.

 

Does the Company enter into written agreements with NEOs regarding their compensation?

 

Yes, the compensation paid in 2008 to the NEOs was determined, in part, by the terms set forth in employment agreements that were negotiated at arm’s length between the Company and each of the NEOs. We believe that having employment agreements with the NEOs provides an incentive to them to remain with the Company and serves to align their interests with those of the stockholders, including in the event of a potential acquisition of the Company.

 

During the 2008 fiscal year, the employment agreement for each NEO was amended to reflect recent changes to the tax code. These amendments generally impact the timing of certain severance benefits which the NEOs may be entitled to receive and do not increase the amount of compensation owed to the NEOs.

 

Salvatore Iannuzzi.  The Company entered into an employment agreement with Mr. Iannuzzi, effective April 11, 2007. Pursuant to his employment agreement, Mr. Iannuzzi receives a base salary of $1,000,000 per year, subject to review and increase (but not decrease) by the Board of Directors and the Compensation Committee. Mr. Iannuzzi is eligible to earn an annual bonus based on his attainment of certain performance objectives, but his bonus may not be less than the maximum bonus opportunity available to the Company’s other senior executives. In

addition, Mr. Iannuzzi is eligible to receive grants of equity-based awards, in the Compensation Committee’s discretion, at a level commensurate with his position. Per his employment agreement, Mr. Iannuzzi is also entitled to participate in those benefit plans generally provided by the Company to its senior executives. Upon his termination of employment or a change in control of the Company, the employment agreement provides for certain payments and benefits to Mr. Iannuzzi, as described below in the section entitled “Potential Payments Upon Termination or Change-in-Control.” Under the employment agreement, Mr. Iannuzzi has agreed that, during his employment and for one year thereafter, he will not compete with the Company or solicit non-clerical employees, consultants, or service providers of the Company to terminate such person’s relationship with the Company. Additionally, Mr. Iannuzzi has agreed to restrictive covenants regarding confidentiality and non-disparagement.

 

Timothy T. Yates.  The Company entered into an employment agreement with Mr. Yates, effective June 7, 2007. Pursuant to this employment agreement, Mr. Yates receives a base salary of $500,000 per year, subject to review and increase (but not decrease) by the CEO, the Board of Directors and the Compensation Committee. Mr. Yates is eligible to earn an annual bonus based on his attainment of certain performance objectives, with the amount to be determined by the Compensation Committee. In addition, Mr. Yates is eligible to receive grants of equity-based awards, in the Compensation Committee’s discretion, at a level commensurate with his position. Per his employment agreement, Mr. Yates is also entitled to participate in benefit plans as generally provided by the Company to its senior executives. Upon his termination of employment or a change in control of the Company, the employment agreement provides for certain payments and benefits to Mr. Yates, as described below in the section entitled “Potential Payments Upon Termination or Change-in-Control.” Under the employment agreement, Mr. Yates has agreed that, during his employment and for one year thereafter, he will not compete with the Company or solicit non-clerical employees, consultants, or service providers of the Company to terminate such person’s relationship with the Company. Additionally, Mr. Yates has agreed to restrictive covenants regarding confidentiality and non-disparagement.

 

Darko Dejanovic.  The Company entered into an employment agreement with Mr. Dejanovic, dated March 2, 2007. Pursuant to his employment agreement, Mr. Dejanovic receives a base salary of $450,000 per year, and is eligible to earn an annual bonus based on his attainment of certain performance objectives, with his target bonus opportunity equal to 100% of his base salary. In addition, Mr. Dejanovic is eligible to participate in the Company’s equity incentive plans. Per his employment agreement, Mr. Dejanovic is also entitled to participate in benefit plans as generally provided by the Company. Upon his termination of employment or a change in control of the Company, the employment agreement provides for certain payments to Mr. Dejanovic, as described below in the section entitled “Potential Payments Upon Termination or Change-in-Control.” Under the employment agreement, Mr. Dejanovic has agreed that, during his employment and for three months thereafter, he will not compete with the Company or solicit clients, employees and other service providers of the Company to terminate such person’s relationship with the Company. Additionally, Mr. Dejanovic has agreed to restrictive covenants regarding confidentiality and non-disparagement.

 

James M. Langrock.  The Company entered into an employment agreement with Mr. Langrock, effective May 15, 2008. Pursuant to his employment agreement, Mr. Langrock receives a base salary of $350,000 per year, subject to review and increase (but not decrease) by the CEO, the Board of Directors and the Compensation Committee. In addition, Mr. Langrock is eligible to earn an annual bonus based on his attainment of certain performance objectives, with his target bonus opportunity equal to 60% of his base salary. In connection with entering into the employment agreement, Mr. Langrock received a one-time sign on bonus of $500,000. Mr. Langrock is eligible to receive grants of equity-based awards, in the Compensation Committee’s discretion, commensurate with his position. Per his employment agreement, Mr. Langrock is entitled to participate in benefit plans as generally provided by the Company to its senior executives. Upon his termination of employment or a change in control of the Company, the employment agreement provides for certain payments and benefits to Mr. Langrock, as described below in the section entitled “Potential Payments Upon Termination or Change-in-Control.” Under the employment agreement, Mr. Langrock has agreed that, during his employment and for one year thereafter, he will not compete with the Company or solicit non-clerical employees, consultants, or service providers of the Company to terminate such person’s relationship with the Company. Additionally, Mr. Langrock has agreed to restrictive covenants regarding confidentiality and non-disparagement.

Lise Poulos.  The Company entered into an employment agreement with Ms. Poulos, effective September 7, 2007. Pursuant to her employment agreement, Ms. Poulos initially received a base salary of $375,000 per year, subject to review and increase (but not decrease) by the CEO, the Board of Directors and the Compensation Committee. Ms. Poulos’ base salary has since been increased to $450,000 per year. In addition, Ms. Poulos is eligible to earn an annual bonus based on her attainment of certain performance objectives, with her target bonus opportunity equal to 100% of her base salary. Ms. Poulos is eligible to receive grants of equity-based awards, in the Compensation Committee’s discretion, at a level commensurate with her position. Per her employment agreement, Ms. Poulos is entitled to participate in benefit plans as generally provided by the Company to its senior executives. Upon her termination of employment or a change in control of the Company, the employment agreement provides for certain payments and benefits to Ms. Poulos, as described below in the section entitled “Potential Payments Upon Termination or Change-in-Control.” Under the employment agreement, Ms. Poulos has agreed that, during her employment and for one year thereafter, she will not compete with the Company or solicit non-clerical employees, consultants, or service providers of the Company to terminate such person’s relationship with the Company. Additionally, Ms. Poulos has agreed to restrictive covenants regarding confidentiality and non-disparagement.

 

Mark Stoever.  The Company entered into an employment agreement with Mr. Stoever, dated June 30, 2005. Pursuant to his employment agreement, Mr. Stoever receives a base salary of $300,000 per year, reviewed annually, and is eligible to earn an annual bonus based on his attainment of certain performance objectives, with his target bonus opportunity equal to 100% of his base salary. Mr. Stoever is also entitled to participate in benefit plans as generally provided by the Company. Upon his termination of employment or a change in control of the Company, the employment agreement provides for certain payments and benefits to Mr. Stoever, as described below in the section entitled “Potential Payments Upon Termination or Change-in-Control.” In connection with his employment agreement, Mr. Stoever entered into the Company’s standard confidentiality and non-solicitation agreement for employees.

 

What are the primary elements of executive compensation while NEOs are employed by the Company?

 

There are three primary elements of our executive compensation program for actively-employed NEOs:

 

 

In addition, our executive officers participate in our various benefits programs, and certain of our executive officers receive perquisites from time to time.

 

The following is a discussion of these primary elements of our compensation program for actively-employed NEOs.

 

Base Salary

 

As described above, the Company has entered into employment agreements with each of its NEOs that provide some of the basic terms of their employment with the Company. When entering into such an employment agreement, and determining the appropriate level of base salary for the applicable NEO, the Compensation Committee typically seeks to set base salary at a level that ensures such NEO will be committed to serving the Company and provides a solid compensation base upon which to add incentive compensation. Among the factors considered by the Compensation Committee are the NEO’s prior experience, employment and compensation (whether with the Company or another entity), the expected duration of the employment relationship and competitive compensation packages in the marketplace generally and among the peer group companies listed above.

 

With the exception of Mr. Langrock, all of the Company’s NEOs entered into employment agreements with the Company prior to 2008. In 2008, the Company entered into an employment agreement with Mr. Langrock and determined that a base salary of $350,000 per year, subject to discretionary increases in the future, represented an

attractive base compensation level that would secure Mr. Langrock’s commitment to the Company and was appropriate based on Mr. Langrock’s prior experience.

 

In addition, in 2008 the Compensation Committee increased Ms. Poulos’ base salary from $375,000 to $400,000 in January 2008 in recognition of increased responsibilities in her then-current position and again from $400,000 to $450,000 in June 2008 in recognition of her new role and increased responsibilities as Executive Vice President and Chief Administrative Officer. With respect to each of the other NEOs, the Company did not increase base salary during 2008.

 

Annual Bonus Opportunity

 

Generally

 

The Company uses annual bonuses to reward executive officers for their services provided to the Company. For 2008, the annual bonus was comprised of two components. The first component of the bonus was based upon certain performance targets or goals set for each executive officer. These targets or goals were set by the Compensation Committee, in consultation with the CEO and CFO, prior to March 31, 2008 (the Compensation Committee generally sets targets or goals by March 31st of the year in which performance is measured; targets and goals are established each year to ensure that they are encouraging and rewarding). The second component of the bonus was discretionary, meaning that the Compensation Committee could award a bonus that was independent of targets that were set prospectively. For 2008, the Compensation Committee granted both performance-based bonuses and discretionary bonuses to certain NEOs. As described in greater detail below, the discretionary bonuses were based upon, in large part, the immense amount of work and dedication required by the NEOs to achieve various milestones in 2008 and early 2009 in a challenging macroeconomic environment, including the consummation (and the cost savings achieved as a result of the renegotiation of the previously negotiated terms) of the acquisition of the majority interest in China HR.com Holdings Ltd. (together with its subsidiaries, “ChinaHR”) and a measured decrease in the Company’s operating expenses despite significant investment in the Company’s future growth as evidenced by the successful launch of the Company’s new website and successful overhaul of the Company’s technology platform.

 

In setting the targets and goals for 2009 under the Incentive Plan described below under “Performance-Based Component,” upon the recommendation of management and in response to the current global macroeconomic environment, the Compensation Committee has determined that to the extent any bonuses are paid under the Incentive Plan in recognition for performance in 2009, such bonuses will be paid wholly in the form of restricted stock or restricted stock units (“RSUs”) that will vest 25% per year over four years, as opposed to cash, as permitted by the terms of the Incentive Plan.

 

Performance-Based Component

 

In early 2008, the Company established a performance-based compensation plan approved by the Compensation Committee that called for annual bonuses to be paid under the Monster Worldwide, Inc. Executive Incentive Plan (the “Incentive Plan”) to NEOs and certain other executive officers based upon 2008 Consolidated Revenues, 2008 Consolidated Operating Income and 2008 Earnings Per Share, weighted equally (the “2008 Performance Plan”). “2008 Earnings Per Share” means the Company’s consolidated, fully-diluted earnings per share from continuing operations for the year ending December 31, 2008 (based on the Company’s 2008 audited financial statements filed with the Company’s Form 10-K on February 12, 2009), but excluding (1) business reorganization, restructuring and other special charges, (2) impairment write-offs of long-term assets (including goodwill), (3) fees and expenses incurred in connection with legal actions and investigations relating to the Company’s historical stock option grant practices, (4) any changes in accounting principles from those in effect on January 1, 2008, (5) the effect of acquisitions consummated on or after January 1, 2008, other than the consummation of the acquisition of Affinity Labs Inc., and (6) the effect of operations that are treated as discontinued operations in the 2008 audited financial statements. “2008 Consolidated Revenue” means the Company’s consolidated revenue for the year ending December 31, 2008 (based on the Company’s 2008 audited financial statements filed with the Company’s Form 10-K on February 12, 2009), but excluding (1) any changes in accounting principles from those in effect on January 1, 2008, (2) the effect of acquisitions consummated on or after January 1, 2008 and (3) the effect of operations that are treated as discontinued operations in the 2008 audited financial statements. “2008 Consolidated

Operating Income” means the operating income (pre-tax and pre-non-operating items) of the Company for the year ended December 31, 2008 (based on the Company’s audited financial statements filed with the Company’s Form 10-K on February 12, 2009), but excluding (1) business reorganization, restructuring and other special charges, (2) impairment write-offs of long-term assets (including goodwill), (3) fees and expenses incurred in connection with legal actions and investigations relating to the Company’s historical stock option grant practices, (4) any changes in accounting principles from those in effect of January 1, 2008, and (5) the effects of operations that are treated as discontinued operations in the 2008 audited financial statements. In order to receive payment with respect to an award under the 2008 Performance Plan, each applicable NEO had to remain employed as an executive officer through the date of payment. The awards under the 2008 Performance Plan were payable in cash or in shares of the Company’s common stock, as determined by the Company’s management (subject to Compensation Committee approval). Awards under the 2008 Performance Plan to the NEOs other than Messrs. Iannuzzi and Yates were paid in shares of common stock. Awards to Messrs. Iannuzzi and Yates under the 2008 Performance Plan were paid in cash. Messrs. Iannuzzi and Yates voluntarily elected to purchase shares of the Company’s common stock in the open market with the entire net amount of their respective 2008 Performance Plan award. Mr. Langrock did not receive a bonus under the 2008 Performance Plan because he did not join the Company until May of 2008 and was not eligible to participate in the 2008 Performance Plan, but he did receive a discretionary bonus as described below.

 

Under the 2008 Performance Plan, the Compensation Committee has the discretion to reduce the actual payouts of bonuses that would otherwise be paid on the basis of the pre-established goals. In determining whether to exercise this discretion, the Compensation Committee, in consultation with management, assessed whether the individual NEO achieved financial and non-financial results that contributed positively toward the performance of the Company and whether the NEO’s performance was unsatisfactory, satisfactory or exceptional. Due to its assessment of the contributions of the NEOs to the success of the Company in 2008, the Compensation Committee did not exercise its discretion to reduce the awards to any NEOs under the 2008 Performance Plan.

 

The target and maximum performance-based award opportunities for the NEOs under the 2008 Performance Plan are provided below. The “Target” column reflects the bonus opportunity for an NEO if the targeted budgeted levels of 2008 Earnings Per Share, 2008 Consolidated Revenues and 2008 Consolidated Operating Income are achieved and an individual performance factor reflecting satisfactory individual performance is applied. The “Maximum Award” column reflects the bonus opportunity for an NEO if the maximum 2008 Earnings Per Share, 2008 Consolidated Revenues and 2008 Consolidated Operating Income are achieved and the maximum individual performance factor is applied reflecting exceptional individual performance.

 

 

The Company’s 2008 Earnings Per Share were $1.42, 2008 Consolidated Revenues were $1,334,284,000 and 2008 Consolidated Operating Income was $248,840,000. Based on these results, the 2008 Consolidated Revenue threshold level was not achieved. However, the 2008 Earnings Per Share and 2008 Consolidated Operating Income were greater than the amount required to meet the threshold (but less than the amount required to receive the maximum award). In addition, the Compensation Committee decided to apply the maximum individual performance factor in computing the performance-based bonuses under the 2008 Performance Plan for all of the NEOs. Accordingly, the NEOs were entitled to the following awards under the 2008 Performance Plan: $860,000 for Mr. Iannuzzi; $430,000 for Mr. Yates; $387,000 for Mr. Dejanovic; $344,000 for Ms. Poulos; and $258,000 for Mr. Stoever. As discussed above, the Compensation Committee did not exercise its discretion to reduce these awards.

 

The Incentive Plan provides that if any incentive compensation bonus is paid pursuant to the Incentive Plan on the basis of financial results achieved by the Company, and the Company is subsequently required to restate its financial statements resulting in the financial results being reduced such that the incentive compensation bonus would not have been paid (or would have been smaller in amount), and the participant receiving such incentive

compensation bonus had actual knowledge of the circumstances requiring the restatement, then such participant may have the incentive compensation bonus reduced to the amount, if any, that in the Compensation Committee’s sole judgment, would have been earned on the basis of the revised financial statements. The Compensation Committee may require the participant receiving the incentive compensation bonus, as a condition to the receipt of the incentive compensation bonus, to agree that the incentive compensation bonus may be reduced, and the Company shall be entitled to seek recovery from the participant, as it deems appropriate under the circumstances, in the best interest of the Company and as permitted by law.

 

Discretionary Component

 

The Compensation Committee determined that, in addition to the performance-based compensation discussed above, NEOs would also be compensated with discretionary bonuses for achieving certain qualitative goals that are not necessarily reflected in the Company’s 2008 financial results. The achievements that the Compensation Committee considered in awarding discretionary bonuses included: (a) the cost savings achieved as a result of the renegotiation of the terms under which we acquired the majority interest in ChinaHR (e.g., certain of the NEOs were able to negotiate a reduction in the purchase price and were able to impose a condition that a portion of the purchase price be held back in escrow in the event that the Company has a claim under the purchase agreement); (b) the successful launch of a new state-of-the-art website that we believe will enhance all aspects of a user’s experience on our site; (c) the successful overhaul of the Company’s technology platform to, among other things, make it more secure and scalable and to deliver innovative products and services on time and on a global basis; and (d) a measured decrease in the operating expenses of the Company despite a commitment to ongoing investment. The Compensation Committee recognized the immense amount of effort, dedication and cross-functional cooperation required by the NEOs and the remainder of the Company’s employees in order to achieve these goals in such a challenging macroeconomic environment. As a result of these achievements, the Compensation Committee awarded the following discretionary bonuses: $440,000 to Mr. Iannuzzi; $120,000 to Mr. Yates; $263,000 to Mr. Dejanovic; $156,000 to Ms. Poulos; and $42,000 to Mr. Stoever. Discretionary bonuses for the NEOs other than to Messrs. Iannuzzi and Yates were paid in shares of common stock. The discretionary bonuses paid to Messrs. Iannuzzi and Yates were paid in cash. Messrs. Iannuzzi and Yates voluntarily elected to purchase shares of the Company’s common stock in the open market with the entire net amount of their respective bonuses. The Compensation Committee determined to pay a discretionary cash bonus of $250,000 to Mr. Langrock in 2008 in recognition of his contributions to the Company during his first year of employment and based on his ineligibility to participate in the 2008 Performance Plan. The aggregate 2008 annual bonuses (i.e., the performance-based component and the discretionary component) awarded to Messrs. Iannuzzi, Yates, Dejanovic, Stoever, Langrock and to Ms. Poulos were $1,300,000, $550,000, $650,000, $300,000, $250,000 and $500,000, respectively.

 

The Compensation Committee intends to continue to award discretionary annual bonuses to NEOs that are not subject to pre-established performance goals and bonus plans to the extent that it deems necessary to reward valuable executives whose contributions to the Company are not necessarily evident in the short-term financial results of the Company or when otherwise necessary to retain valued NEOs.

 

For 2009, the Compensation Committee has determined, upon the recommendation of management and in response to the global macroeconomic environment, that to the extent discretionary bonuses are awarded in recognition of performance in 2009, such bonuses will be paid in the form of restricted stock or RSUs that will vest 25% per year over four years, as opposed to cash.

 

Equity Awards

 

As mentioned above, equity is the third element of compensation used to reward current executives of the Company. Historically, equity compensation has been used to align an executive’s interests with those of our stockholders, to provide long-term incentives to executives and to help the Company retain key executives. Equity awards in 2008 were made in the form of restricted stock. Prior to 2006, our primary form of equity compensation was non-qualified stock options. Since the beginning of 2006, we have not made any material stock option grants, although we may in the future determine to do so. Rather, our primary forms of equity awards since the beginning of 2006 have been RSUs (each representing the contingent right to receive a share of Company common stock in the future) and restricted stock. This change from non-qualified stock options to RSUs and restricted stock was based

primarily on the Compensation Committee’s belief that grants of full value awards are more in line with the Company’s focus on long-term goals, as well as changes in accounting rules that eliminated the accounting advantages associated with options. The Compensation Committee approved grants of restricted stock to the NEOs in 2008 under the 1999 Long Term Incentive Plan or the 2008 Equity Incentive Plan (which was approved the Company’s stockholders at the 2008 Annual Meeting and superseded the 1999 Long Term Incentive Plan). The Compensation Committee did not award RSUs to any of the NEOs in 2008.

 

In establishing the number shares of restricted stock (and, in 2007, RSUs) to award to executive officers each year as part of the Company’s annual equity award program, the Compensation Committee:

 

 

The RSUs and restricted stock granted as part of the Company’s annual equity award program require the executive’s continued employment with the Company through the applicable vesting date and may contain vesting terms based either on the passage of time or a combination of performance conditions and the passage of time.

 

In 2008, Mr. Iannuzzi was awarded 120,000 shares of restricted stock, Mr. Yates was awarded 60,000 shares of restricted stock, Mr. Dejanovic was awarded 60,000 shares of restricted stock, Ms. Poulos was awarded 55,000 shares of restricted stock, Mr. Stoever was awarded 30,000 shares of restricted stock and Mr. Langrock was awarded 30,000 shares of restricted stock. These awards do not contain a performance goal, but contain a vesting schedule with 25% of the shares vesting each year for four years so long as the NEO remains employed through each vesting date. In determining how many shares of restricted stock to award to each NEO, the Compensation Committee considered all of the criteria listed above.

 

As discussed previously, in 2008, the Company’s management engaged Buck to provide it with an executive retention arrangement for its top executives, including the NEOs. The analysis provided by Buck expressed concern that the equity component of total compensation for these executives did not reflect the extraordinary contributions of these executives to the Company, especially given the drop in value of recently granted awards. In order to ensure the retention of our top talent and the desire to keep the current management team in place, the Compensation Committee granted a one-time award of performance-based shares of restricted stock to the NEOs pursuant to a “Special Program” designed to provide a significant incentive to the NEOs to stay with Company. The restricted stock awarded under the Special Program vests as follows:

 

 

To the extent that the restricted stock awarded under the Special Program has not vested by the fifth anniversary of the grant date of such restricted stock, the unvested shares of restricted stock will be forfeited as of such date. Pursuant to the Special Program, Mr. Iannuzzi was awarded 350,000 shares of restricted stock; Mr. Yates was awarded 150,000 shares of restricted stock; Mr. Dejanovic was awarded 150,000 shares of restricted stock; Ms. Poulos was awarded 100,000 of restricted stock; Mr. Stoever was awarded 50,000 shares of restricted stock; and Mr. Langrock was awarded 60,000 shares of restricted stock. None of these shares of restricted stock vested in 2008.

 

From time to time, the Compensation Committee may grant equity awards to executive officers outside of the Company’s annual equity grant program. During 2008, these awards generally were in connection with promotions,

new hires or a perceived need to retain a specific employee or employees. Except as described above, however, none of the NEOs received such discretionary grants during 2008.

 

The Company has no program, plan or practice to coordinate equity grants with the release of material information. The Company does not accelerate or delay equity grants in response to material information, nor does it delay the release of information due to plans for making equity grants. Under the Company’s Compensation Committee Charter, the Compensation Committee is prohibited (in the absence of extraordinary circumstances) from granting stock options unless such options are granted at regularly scheduled meetings of the Compensation Committee. In addition, if options are granted, they must be reasonable in size and have a minimum four year vesting period.

 

Benefits

 

Executive officers are eligible, on the same basis and under the same plans as other employees, for our medical plan, dental plan, vision plan, flexible spending accounts for healthcare costs, life insurance and disability insurance. In addition, we maintain a 401(k) retirement savings plan for the benefit of all of our U.S. employees, which during 2008 included an employer match of up to three percent of the participant’s annual eligible earnings. During 2008, we made matching contributions to the NEOs as detailed in the “All Other Compensation Table” on page 24. Our benefits are intended to be competitive with benefits offered by employers with whom we compete for talent in the marketplace. Effective as of April 3, 2009, the Company suspended the employer match component of the 401(k) retirement savings plan indefinitely.

 

Perquisites and Other Benefits

 

Perquisites and other benefits are not a significant component of our executive compensation program. During 2008, the Company provided to Mr. Iannuzzi and Ms. Poulos Company-paid transportation for transportation between their primary residences and their primary office location. In addition, the Company provided Company-paid housing to Mr. Dejanovic and Ms. Poulos.

 

The Compensation Committee authorized these perquisites described above because they were required pursuant to existing contracts, because such perquisites are customarily provided to CEOs of companies of a similar size or type as the Company or because they were necessary, in the case of Mr. Dejanovic, to induce the executive to change the executive’s primary residence for the benefit of the Company, and in the case of Ms. Poulos, to accommodate, on a short-term basis, the increased travel requirements as a result of her new position at the Company. The amounts paid by the Company for these benefits are set forth in the “All Other Compensation Table” on page 24.

 

The Company provided tax gross-ups to the applicable NEOs with respect to taxable perquisites they received during 2008. The Compensation Committee has determined that effective July 1, 2009, all gross-ups will be eliminated on perquisites provided to executive officers that are not made available to employees generally, except that existing housing arrangements with Mr. Dejanovic and Ms. Poulos (including tax gross-ups) will remain in effect through October 2009.

 

Does the Company have any obligations to provide payments following termination or a change in control of the Company, and what is the rationale for those arrangements?

 

As described above, the Company has employment agreements with each of the NEOs governing certain payments that may be made to them upon their termination of employment or a change in control of the Company. The Compensation Committee believes that these employment contracts provide an incentive to the NEOs to remain with the Company and serve to align the interests of the NEOs and stockholders, including in the event of a potential acquisition of the Company. In addition, by providing for income protection for our NEOs in the event of termination of employment or the uncertainty created by a potential change in control scenario, our employment agreements serve to ensure our NEOs’ devotion to the Company despite such challenges.

 

In addition, upon a change in control and upon certain types of termination of employment, each NEO is entitled to accelerated vesting of all or a portion of his or her outstanding equity awards. The Compensation

Committee believes such accelerated vesting upon certain types of termination of employment (excluding voluntary termination and termination as a result of an NEO’s violation of Company policy or breach of an agreement with the Company) or upon the occurrence of a change in control creates a valuable and appropriate connection between the executives’ interests and those of the Company’s stockholders and ensures that such executives will contribute to the success of the Company even when they may face uncertainty about their future employment prospects with the Company.

 

For more information regarding these potential severance payments and benefits, as well as the acceleration of vesting of outstanding equity awards, see “Potential Payments upon Termination or Change-in-Control” beginning on page 27.

 

How do tax and accounting implications play a role in executive compensation?

 

The Company considers tax and accounting implications in determining all elements of its compensation programs. Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), generally denies a deduction to any publicly held corporation for compensation (other than qualified performance-based compensation) exceeding $1,000,000 paid in a taxable year to the Chief Executive Officer or any one of the next three most highly compensated officers (other than the Chief Financial Officer) reported in the Summary Compensation Table. The Compensation Committee considers the impact of this deductibility limit on the compensation that it intends to award, and attempts to structure compensation such that it is deductible whenever possible and appropriate. For example, the Company’s annual performance-based bonus program is intended to satisfy the requirements of Section 162(m). However, while the Compensation Committee is cognizant of the applicable thresholds of Section 162(m), it may exercise its discretion to award compensation that does not meet the requirements of Section 162(m) when it considers it in the best interests of the Company to do so. The Compensation Committee has exercised this discretion, for example, when making stock awards without any performance-based conditions and in the payment of a discretionary bonus to Messrs. Iannuzzi and Dejanovic, the only NEOs whose 2008 compensation exceeded the 162(m) threshold for 2008. The Compensation Committee believes that in some instances, such as the ones described above, it is in the best interests of the Company to exceed the limitations established by Section 162(m) in order to aid in the recruitment and retention of key executives.

 

When establishing executive compensation, the Compensation Committee considers the effect of various forms of compensation on the Company’s financial reports. In particular, the Compensation Committee considers the potential impact, on current and future financial reports, of all equity compensation that it approves.

 

Does the Company have stock ownership guidelines for executive officers?

 

In January 2006 our Board of Directors adopted an equity retention policy that applies to certain of our executive officers. The policy requires each such executive officer to retain 25% of the total equity securities granted to the executive officer following the date of the adoption of the policy, through the earlier of the individual’s termination of employment, death or disability or a change in control of the Company (as defined in the policy). “Equity securities” include RSUs, restricted stock, stock options or other equity-based compensatory awards (and excludes any award issued prior to January 18, 2006, any non-compensatory equity award or issuance or any award or issuance that is made in equity solely because of limitations on the amount of cash that may be paid in the particular case because of performance-based award limitations). The Board of Directors adopted the equity retention policy to support an ownership culture at the Company and to align our executives with the interest of stockholders.

 

Compensation Committee Report

 

The Compensation Committee has reviewed the Compensation Discussion and Analysis and discussed it with management. Based on its review and discussions with management, the Compensation Committee recommended to our Board of Directors that the Compensation Discussion and Analysis be incorporated by reference into the

Company’s Annual Report on Form 10-K for 2008 and included in this Proxy Statement. This report is provided by the following independent directors, who comprise the Compensation Committee:

 

Robert J. Chrenc (Chairman)
Edmund P. Giambastiani, Jr.
David A. Stein
Roberto Tunioli

 

Summary Compensation Table

 

The following table sets forth the compensation earned during 2008 by our CEO, our CFO, our three other most highly compensated executive officers during 2008 who were executive officers at December 31, 2008, and one additional individual who served as an executive officer during 2008 and whose compensation is required to be disclosed in accordance with SEC rules. In accordance with SEC rules, 2007 compensation information is also included in the table for the named executive officers whose 2007 compensation information was included in the proxy statement relating to our 2008 annual meeting of stockholders.

 

The three tables immediately following this “Summary Compensation Table” — the “Bonus Table,” the “Stock Awards Table” and the “All Other Compensation Table” — provide additional details regarding the compensation included in this “Summary Compensation Table.”

 

 

 

 

Bonus Table

 

The following table provides a breakdown of all 2008 bonus amounts included in the “Summary Compensation Table” above.

 

 

 

 

 

Stock Awards Table

 

The following table provides a breakdown by award of the 2008 amounts included in the “Stock Awards” column of the “Summary Compensation Table” above.

 

 

 

 

All Other Compensation Table

 

The following table details each component reported for 2008 in the “All Other Compensation” column in the “Summary Compensation Table” above.

 

 

 

 

Grants of Plan-Based Awards in 2008

 

The following table provides information about equity and non-equity incentive plan awards granted to the named executive officers in 2008.

 

 

 

 

 

Outstanding Equity Awards at December 31, 2008

 

The following table summarizes the holdings of stock option and stock awards of our named executive officers at December 31, 2008. The table includes unexercised stock option awards, both exercisable and not exercisable, and stock awards that have not vested, for each named executive officer outstanding as of December 31, 2008.

 

 

 

 

 

Option Exercises and Stock Vested

 

The following table provides information relating to the number of shares acquired by the named executive officers upon the vesting of stock awards during 2008 and the value realized, before any applicable tax and other withholding obligations. None of the named executive officers exercised stock options during 2008.

 

 

 

 

Potential Payments Upon Termination or Change-in-Control

 

This section describes the payments and other benefits that we have agreed to provide to the NEOs if their employment terminates in the future for various reasons, and in the event of any future change in control of the Company. We also quantify such payments and benefits assuming that (1) the termination or change in control had occurred on December 31, 2008, and (2) the value realized upon the accelerated vesting of restricted stock and RSUs was $12.09 per share, the closing price of our common stock on that date.

Generally, as described in more detail below, each of the NEOs is entitled to certain payments, benefits and/or accelerated vesting of their equity awards in the event of:

 

 

Generally, all of the Company’s outstanding equity awards will become fully vested according to their terms upon a change in control. Although the definition of a “change in control” varies in some cases with respect to employment agreements and the terms of equity awards, a “change in control” will generally occur upon:

 

 

We amended the employment agreements for Messrs. Iannuzzi, Yates and Langrock and Ms. Poulos, effective January 1, 2009, to provide that upon the occurrence of an event that could lead to a change in control that does not meet the requirements of Internal Revenue Code Section 409A, the Company is required to establish an irrevocable grantor trust and transfer to the trustee of such trust an amount equal to the severance payments and the estimated tax gross up payments, if any, owed to each such NEO upon a termination of employment in connection with such change in control. The amounts transferred to the trustee will be paid to the applicable NEOs in accordance with the terms of their employment agreements. These amendments were made to ensure that these NEOs will receive their contractual benefits in such an event as intended under their original employment agreements.

 

Salvatore Iannuzzi

 

The table below quantifies the assumed payments and benefits that Mr. Iannuzzi would have been entitled to upon his termination of employment for various reasons or a change in control of the Company, in each case, as of December 31, 2008, and the footnotes describe the contractual provisions that provide those rights to Mr. Iannuzzi.

 

 

 

 

Timothy T. Yates

 

The table below quantifies the assumed payments and benefits that Mr. Yates would have been entitled to upon his termination of employment for various reasons or a change in control of the Company, in each case, as of December 31, 2008, and the footnotes describe the contractual provisions that provide those rights to Mr. Yates.

 

 

 

 

Darko Dejanovic

 

The table below quantifies the assumed payments and benefits that Mr. Dejanovic would have been entitled to upon his termination of employment for various reasons or a change in control of the Company, in each case, as of December 31, 2008, and the footnotes describe the contractual provisions that provide those rights to Mr. Dejanovic.

 

 

 

 

James M. Langrock

 

The table below quantifies the assumed payments and benefits that Mr. Langrock would have been entitled to upon his termination of employment for various reasons or a change in control of the Company, in each case, as of December 31, 2008, and the footnotes describe the contractual provisions that provide those rights to Mr. Langrock.

 

 

 

 

Lise Poulos

 

The table below quantifies the assumed payments and benefits that Ms. Poulos would have been entitled to upon her termination of employment for various reasons or a change in control of the Company, in each case, as of December 31, 2008, and the footnotes describe the contractual provisions that provide those rights to Ms. Poulos.