Incorporated under the laws | I.R.S. Employer Identification | |
of South Carolina | No. 57-0248420 | |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. | |
Stock Appreciation Rights | Performance Contingent Restricted Stock Unit Awards | |||||||||||
Name | Threshold | Target | Maximum | |||||||||
M. J. Sanders | 158,900 | 29,260 | 58,520 | 87,780 | ||||||||
R. C. Tiede | 80,510 | 14,305 | 28,610 | 42,915 | ||||||||
J. M. Colyer, Jr. | 78,390 | 14,305 | 28,610 | 42,915 | ||||||||
B. L. Saunders | 61,450 | 11,705 | 23,410 | 35,115 | ||||||||
R. H. Coker | 36,050 | 6,655 | 13,310 | 19,965 | ||||||||
All other officers | 167,360 | 31,335 | 62,670 | 94,005 | ||||||||
Approved Features | ||
Grant Type: | Stock-Settled Stock Appreciation Rights | |
SAR Price: | Fair Market Value on February 12, 2014 (Closing price on the New York Stock Exchange) | |
Exercise Term: | 7 years from date of grant; expiration date February 12, 2021. | |
Vesting: | 100% will vest on February 12, 2015, the first anniversary of the date of the grant. Unvested SARs are cancelled upon termination of employment, except in the case of death, disability, or involuntary (or good reason) termination within two years of a Change in Control that meets the criteria of Internal Revenue Code (“IRC”) Section 409A and the regulations thereunder, in which case, unvested SARs will immediately vest upon the date of termination. In the case of retirement, unvested SARs will continue to vest provided the employee does not accept employment (without prior approval from Sonoco) that violates his or her signed Employee Agreement; violation results in forfeiture of all remaining awards. | |
Clawback Policy: | Pursuant to the Company’s Incentive Compensation Clawback Policy, if the Company is required to restate its financial results because of its material noncompliance with any financial reporting requirement under the securities laws, and if the Executive Compensation Committee determines in its sole and absolute discretion that any payments or awards made to Participant hereunder were based on erroneous data and would have been lower had they been calculated based on the restated results, the Committee will review the facts and circumstances and, to the extent permitted by applicable law, seek to recover for the benefit of Sonoco the difference between the amounts awarded or paid to Participant and the amounts that would have been awarded or paid based on the restated results. The Committee will in its sole and absolute discretion, subject to applicable law, determine the form and timing of such repayment. | |
Exercise Period at Termination | ||
Death: | Longer of remaining term of SAR or one year. | |
Disability: | Shorter of remaining term of SAR or one year from termination following total disability. | |
Retirement: | Shorter of remaining term of SAR or five years from retirement provided the employee does not accept employment (without prior approval from Sonoco) that violates his or her signed Employee Agreement; violation results in forfeiture of all remaining shares. | |
Termination without cause: | Three month exercise period for vested awards after expiration of any blackout period (if applicable) | |
Termination for cause: | Immediate cancellation of all awards | |
Change in Control: | Shorter of remaining term of SAR or one year from an involuntary (or good reason) termination within two years of a Change in Control | |
• | Withholding of shares to pay taxes. |
• | Receive stock certificate for value of SAR or have certificate sent to company approved broker for addition to personal account or sale for cash. |
Grant Date: | February 12, 2014 | |
Performance Cycle: | January 1, 2014 through December 31, 2016 | |
Vesting: | Goals will be established for three levels of performance: acceptable, superior and outstanding | |
• 150% of target shares vest if outstanding (maximum) performance is achieved after three years | ||
• 100% of target shares vest if superior (target) performance is achieved after three years | ||
• 50% of target shares vest if acceptable (threshold) performance is achieved after three years | ||
• If less than the number of threshold shares vest at the end of the 3-year performance period, then one-half of the remaining number of threshold shares will vest and be settled at the end of year four and one-half at the end of year five. | ||
Change in Control: | In the event of a Change in Control, all unvested PCSUs will vest at Target on a pro rata basis if the Change in Control occurs during the 3-year Performance Period or at Threshold on a pro rata basis if the Change in Control occurs during the Time-Vesting Period in year 4 or 5. | |
Clawback Policy: | Pursuant to the Company’s Incentive Compensation Clawback Policy, if the Company is required to restate its financial results because of its material noncompliance with any financial reporting requirement under the securities laws, and if the Executive Compensation Committee determines in its sole and absolute discretion that any payments or awards made to Participant hereunder were based on erroneous data and would have been lower had they been calculated based on the restated results, the Committee will review the facts and circumstances and, to the extent permitted by applicable law, seek to recover for the benefit of Sonoco the difference between the amounts awarded or paid to Participant and the amounts that would have been awarded or paid based on the restated results. The Committee will in its sole and absolute discretion, subject to applicable law, determine the form and timing of such repayment. | |
Threshold Vesting | Target Vesting | Maximum Vesting | |||||||
Three-Year Compound Growth in BEPS | 8.3 | % | 17.8 | % | 24.8 | % | |||
Average Three-Year RONAE¹ | 9.9 | % | 10.4 | % | 10.9 | % | |||
¹ | Actual performance level required within the range depends on capital invested in acquisitions over the three-year period. The RONAE goals will be adjusted down for every dollar of capital investment made in acquisitions at an effective rate of 0.1% for every $100 Million of acquisition investment multiplied by the percentage of time remaining in the three-year performance cycle as of the date of the acquisition. |
SONOCO PRODUCTS COMPANY | ||||
Date: February 18, 2014 | By: | /s/ Barry L. Saunders | ||
Barry L. Saunders | ||||
Vice President and Chief Financial Officer | ||||