(1)	Title of each class of securities to which the transaction applies:

(2)	Aggregate number of securities to which the transaction applies:

(3)	Per unit price or other underlying value of the transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

(4)	Proposed maximum aggregate value of transaction:

(5)	Total fee paid:

(1)	Amount Previously Paid:

(2)	Form, Schedule or Registration Statement No.:

(3)	Filing Party:

(4)	Date Filed:

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DATE AND TIME:	Wednesday, May 17, 2017, at 10:00 a.m. Central Time

PLACE:	United Fire Group, Inc., First Floor Conference Room, 109 Second Street SE, Cedar Rapids, Iowa

ITEMS OF BUSINESS:	At the meeting, we will ask shareholders to:

1)	Elect four Class A Directors identified in the attached proxy statement to three-year terms expiring in 2020.

2)	Ratify the Audit Committee’s appointment of Ernst & Young LLP as our independent registered public accounting firm for 2017.

3)	Approve, on an advisory basis, the compensation of our named executive officers.

4)	Approve, on a non-binding advisory basis, the frequency of future shareholder votes on executive compensation.

5)	Vote upon such other matters as may properly come before the meeting or at any adjournment or postponement thereof.

WHO CAN VOTE:	You can vote if you were a shareholder of record on March 20, 2017.

2016 ANNUAL REPORT:	On or about April 6, 2017, we will begin mailing to our shareholders a Notice Regarding the Availability of Proxy Materials, which will indicate how to access our proxy materials on the Internet. By furnishing the Notice Regarding the Availability of Proxy Materials, we are lowering the costs and reducing the environmental impact of our Annual Meeting.

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•	In person: We will distribute paper ballots to anyone who wishes to vote in person at the Annual Meeting. However, if you hold your shares in street name, you must request a legal proxy from your broker and bring it to the Annual Meeting in order to vote in person at the Annual Meeting.

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By mail: Complete and sign your proxy card and return it by mail in the enclosed business reply envelope. If you mark your voting instructions on the proxy card, your shares will be voted as you instruct. If an additional proposal comes up for a vote at the Annual Meeting that is not on the proxy card, your shares will be voted in the best judgment of the authorized proxies, Jack B. Evans and Neal R. Scharmer.

•	By telephone: To vote your shares by telephone, call the toll-free telephone number on your proxy card. You must have a touch-tone or cellular telephone to use this voting method. You will need to follow the instructions on your proxy card and the voice prompts to vote your shares.

•	Over the Internet: You may go to the website listed on your proxy card to vote your shares over the Internet. You will need to follow the instructions on your proxy card and the website to vote your shares.

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•	delivering written notice to our transfer agent, Computershare Trust Company, N.A., at its proxy tabulation center located at 211 Quality Circle, Suite 210, College Station, Texas 77845;

•	delivering written notice to the Corporate Secretary of United Fire Group, Inc. at P.O. Box 73909, Cedar Rapids, Iowa 52407-3909;

•	executing and delivering a later-dated proxy;

•	voting again by telephone or Internet; or

•	appearing and voting in person at the Annual Meeting. Attendance at the Annual Meeting will not, by itself, revoke a previously granted proxy.

•	Anti-Hedging Policy

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•	Code of Ethics and Business Conduct

•	Corporate Governance Guidelines

•	Committee Charters – Audit Committee, Compensation Committee, Executive Committee, Investment Committee, Nominating and Governance Committee and Risk Management Committee

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•	Each candidate must be prepared to represent the best interests of all of our shareholders and not just one particular constituency.

•	Each candidate must be an individual who has demonstrated integrity and ethics in the candidate’s personal, business, and professional life and has an established record of business and professional accomplishment.

•	Neither the candidate nor the candidate’s family members (as defined in the NASDAQ Listing Rules), affiliates or associates (as defined in Rule 405 promulgated under the Securities Act of 1933) shall have any material personal, financial, or professional interest in any present or potential competitor of ours.

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Each candidate must, as a director, agree to participate fully in Board of Directors activities, including active membership on at least one Board committee and attendance at, and active participation in, meetings of the Board of Directors and the committee(s) of which he or she is a member and not have other personal, business or professional commitments that would interfere with or limit his or her ability to do so.

•	Each candidate must be willing to make, and financially capable of making, an investment in Company Common Stock as required by our Articles of Incorporation and the non-employee director stock ownership guidelines adopted by our Board of Directors.

•	Each candidate should contribute to the Board of Director’s overall diversity, which is broadly construed to mean a variety of opinions, perspectives, personal experience, business experience, professional experience, and backgrounds (such as gender, race, and ethnicity), as well as other differentiating characteristics.

•	Each candidate should contribute positively to the existing chemistry and collaborative culture among the directors.

•	Each candidate should possess professional, business, and personal experience and expertise relevant to the Company’s business. In this regard, the Nominating and Governance Committee will consider financial, management and business background, personal and educational background and experience, community leadership, independence and other qualifications, attributes and potential contributions.

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•	the candidate’s personal qualifications as discussed above;

•	the past and potential contributions of our current directors, and the value of continuity and prior experience on our Board of Directors;

•	the need for a director to possess particular attributes or particular experience or expertise; and

•	other factors that it considers relevant, including any specific qualifications the Nominating and Governance Committee adopts from time to time.

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(1)

Audit Fees. “Audit” fees consist of fees for professional services rendered for the audit of United Fire Group, Inc.’s Consolidated Financial Statements and internal control over financial reporting, review of the interim Consolidated Financial Statements included in quarterly reports, services that are normally provided by the independent registered public accounting firm in connection with statutory or regulatory filings or engagements, and services that generally only the independent registered public accounting firm can reasonably provide.

(2)

Audit-Related Fees. “Audit-Related” fees consist of fees for assurance and related services that are traditionally performed by the independent registered public accounting firm and are reasonably related to the performance of the audit or the review of our financial statements, but are not reported as “Audit” fees. During 2016, the audit-related fees billed to us by Ernst & Young LLP related to out-of-scope work performed for the audit of the UFG Specialty Insurance Company audited statutory financial statements. During 2015, the audit-related fees billed to us by Ernst & Young LLP related to the implementation of the Accenture® Claims System and SEC comment letter and related management response.

(3)	Tax Fees. Tax fees billed to us by Ernst & Young LLP in 2016 and 2015 related to tax compliance, tax advice, or tax planning services rendered to us.

(4)	All Other Fees. During 2016 and 2015, there were no fees billed to us by Ernst & Young LLP for any professional services rendered other than those described above.

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•	reviewed and discussed the audited Consolidated Financial Statements with management;

•	discussed with Ernst & Young LLP the matters required to be discussed by Auditing Standard No. 1301, Communications with Audit Committees, as adopted by the Public Company Accounting Oversight Board;

•	received from Ernst & Young LLP the written disclosures and the letter required by the applicable requirements of the Public Company Accounting Oversight Board regarding the independent auditor’s communications with the Audit Committee concerning independence; and

•	discussed with the independent auditors, the auditors' independence.

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*	This report is not “soliciting material” and is not deemed “filed” with the SEC. The incorporation by reference of this proxy statement into any document filed with the SEC by the Company shall not be deemed to include this report unless such report is specifically stated to be incorporated by reference into such document.

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•	Our executive compensation encourages executive decision-making that is aligned with the long-term interests of our shareholders.

•	Bonuses and equity awards for named executive officers are tied to specific performance goals.

•	We encourage long-term stock ownership by our executive officers with award features such as 20% vesting of stock option awards beginning on the first anniversary of the grant and no vesting of restricted stock until the fifth anniversary of the grant.

•	We have adopted stock ownership guidelines for our executive officers.

•	Our compensation uses a balance of short- and long-term performance metrics to encourage the efficient management of our business and minimize excessive risk-taking.

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(1)	Based on a Schedule 13G (Amendment No. 6) filed with the SEC on February 14, 2017, the number of securities beneficially owned by Mrs. McIntyre as of December 31, 2016 includes: 2,524,969 shares for which Mrs. McIntyre holds sole voting and dispositive power, and 471,863 shares for which Mrs. McIntyre holds shared voting and dispositive power.

(2)	Based on a Schedule 13G (Amendment No. 7) filed with the SEC on January 27, 2017, the number of securities beneficially owned by BlackRock, Inc. as of December 31, 2016 includes: 2,364,869 shares for which it holds sole voting power and 2,416,593 shares for which it holds sole dispositive power.

(3)	Based on a Schedule 13G (Amendment No. 7) filed with the SEC on February 9, 2017, the number of securities beneficially owned by Dimensional Fund Advisors LP as of December 31, 2016 includes: 2,111,925 shares for which it holds sole voting power and 2,149,557 shares for which it holds sole dispositive power.

(4)

Based on a Schedule 13G (Amendment No. 2) filed with the SEC on February 10, 2017, the number of securities beneficially owned by The Vanguard Group as of December 31, 2016 includes: 26,385 shares for which it holds sole voting power, 4,820 shares for which is holds shared voting power, 1,702,669 shares for which it holds sole dispositive power and 30,027 shares for which it holds shared dispositive power.

(5)	Based on a Schedule 13G (Amendment No. 15) filed with the SEC on February 14, 2017, the number of securities beneficially owned by EARNEST Partners, LLC as of December 31, 2016 includes: 368,345 shares for which it holds sole voting power, 93,077 shares for which it holds shared voting power and 1,388,130 shares for which it holds sole dispositive power.

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(1)

The inclusion in this table of any shares shown as beneficially owned does not constitute admission of beneficial ownership. None of the shares disclosed in the table are pledged as security. In computing the number of shares of Company Common Stock beneficially owned by a person and the percentage ownership of that person, we deemed outstanding shares Company Common Stock subject to options held by that person that are currently exercisable or exercisable within 60 days from March 20, 2017, and Company Common Stock issuable upon the vesting of restricted stock units ("RSU") within 60 days from March 20, 2017, to be outstanding. We did not deem these shares outstanding, however, for the purpose of computing the percentage ownership of any other person.

(2)	Includes 5,679 shares owned individually by Mr. Besong and stock options for 1,404 shares that are exercisable by Mr. Besong on or before 60 days from March 20, 2017.

(3)	Includes 79,754 shares owned individually by Mr. Carlton; 37,660 shares owned in accounts for the benefit of Mr. Carlton’s children; and stock options for 780 shares that are exercisable by Mr. Carlton on or before 60 days from March 20, 2017.

(4)	Includes 100 shares owned individually by Ms. Clancy.

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(5)

Includes 12,930 shares owned individually by Mr. Drahozal, including 2,674 shares owned jointly by Mr. Drahozal and his wife; 243,086 shares owned individually by Mr. Drahozal’s wife; 74,714 shares owned in accounts for the benefit of Mr. Drahozal’s children; 471,863 shares owned by the McIntyre Foundation, of which Mr. Drahozal’s wife serves as one of three directors; 66,898 shares owned by the J. Scott McIntyre Trust FBO the Kaye Drahozal Family, of which Mr. Drahozal and his wife serve as co-trustees; and stock options for 14,003 shares that are exercisable by Mr. Drahozal on or before 60 days from March 20, 2017.

(6)	Includes 3,224 shares owned individually by Mr. Ernst; 6,857 shares owned in a Company 401(k) account for Mr. Ernst’s benefit; 1,137 shares held individually by Mr. Ernst’s wife; and stock options for 29,183 shares that are exercisable by Mr. Ernst on or before 60 days from March 20, 2017.

(7)	Includes 46,904 shares owned individually by Mr. Evans; 2,000 shares held in a 401(k) account for Mr. Evan’s benefit; 3,674 shares held in an individual retirement account for Mr. Evans’ benefit; 2,024 shares held in an IRA account for the benefit of Mr. Evans’ wife; and stock options for 2,105 shares that are exercisable by Mr. Evans on or before 60 days from March 20, 2017.

(8)	Includes 1,317 shares owned individually by Ms. Gardial.

(9)	Includes 1,159 shares owned individually by Ms. Jaffray and stock options for 3,158 shares that are exercisable by Ms. Jaffray on or before 60 days from March 20, 2017.

(10)	Includes 12,042 shares owned individually by Ms. Mahon; 1,000 shares held in an individual retirement account for Ms. Mahon’s benefit; and stock options for 14,003 shares that are exercisable by Ms. Mahon on or before 60 days from March 20, 2017.

(11)	Includes 21,874 shares owned individually by Mr. Milligan and stock options for 12,003 shares that are exercisable by Mr. Milligan on or before 60 days from March 20, 2017.

(12)	Includes 6,923 shares owned individually by Mr. Noyce; 2,000 shares held in a trust account for Mr. Noyce’s wife and stock options for 9,003 shares that are exercisable by Mr. Noyce on or before 60 days from March 20, 2017.

(13)	Includes 13,456 shares owned individually by Ms. Quass and stock options for 14,003 shares that are exercisable by Ms. Quass on or before 60 days from March 20, 2017.

(14)	Includes 17,694 shares owned individually by Mr. Ramlo; 352 shares owned individually by Mr. Ramlo’s wife; 1,986 shares owned by a Company 401(k) account for Mr. Ramlo’s benefit; and stock options for 80,979 shares that are exercisable by Mr. Ramlo on or before 60 days from March 20, 2017.

(15)	Includes 4,722 shares owned individually by Mr. Scharmer; 2,236 shares held in a Company 401(k) account for Mr. Scharmer’s benefit; and stock options for 14,218 shares that are exercisable by Mr. Scharmer on or before 60 days from March 20, 2017.

(16)	Includes 23,193 shares owned individually by Mr. Skogman; 1,870 shares held in an individual retirement account for Mr. Skogman’s benefit; 5,500 shares owned by Mr. Skogman’s wife; 150 shares held in an individual retirement account for the benefit of Mr. Skogman’s wife; and stock options for 4,094 shares that are exercisable by Mr. Skogman on or before 60 days from March 20, 2017.

(17)	Includes 4,208 shares owned individually by Ms. Voss, including 100 shares owned jointly by Ms. Voss and her husband.

(18)	Includes 13,213 shares owned individually by Mr. Wilkins; 2,524 shares held in a Company 401(k) account for Mr. Wilkins’s benefit; and stock options for 39,576 shares that are exercisable by Mr. Wilkins on or before 60 days from March 20, 2017.

(19)	Includes 3,436 shares owned individually by the executive officers not otherwise named; 5,617 shares held in a Company 401(k) account for the benefit of the executive officers not otherwise named; and stock options for 38,876 shares that are exercisable by the executive officers not otherwise named on or before 60 days from March 20, 2017.

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(1)	All of the securities remaining available for issuance under this plan may be issued as unrestricted or restricted stock, stock options or stock appreciation rights.

(2)	All of the securities remaining available for issuance under this plan may be issued as either restricted stock units, restricted stock or stock options.

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•	Our return on equity decreased to 5.5% in 2016 from 10.5% in 2015.

•	Our combined ratio increased to 100.3% in 2016 from 92% in 2015.

•	Our net income decreased to $49.9 million in 2016 from $89.1 million in 2015.

•	Our catastrophe losses increased to $61.2 million in 2016 from $32.3 million in 2015.

•	The book value of our common stock increased to $37.04 in 2016 from $34.94 in 2015.

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•	attract and retain qualified individuals;

•	provide compensation that is fair, reasonable and competitive with our industry peers; and

•	provide sufficient incentive opportunities that are linked to the execution of our business strategy and the interests of our shareholders.

•	The Compensation Committee must be composed of only independent directors, with a minimum of three members.

•	The Compensation Committee must meet at least twice each calendar year.

•	The Compensation Committee is directly responsible for and has the resources and authority to retain and compensate any outside counsel, expert, consultant or advisor it deems appropriate and necessary.

•	Annually review and approve the salaries, incentive awards and other compensation for all of our executive officers;

•	Review and discuss with management the information reported in the Compensation Discussion and Analysis section of the Company’s proxy statement, and based on the review and discussions recommend to the Board of Directors that it be included in the proxy statement for our annual meeting and incorporated by reference in our Annual Report on Form 10-K;

•	Prepare and approve the Compensation Committee Report for inclusion in the proxy statement for our annual meeting;

•	Approve and grant stock options, RSUs, and other types of equity-based compensation in accordance with the terms of our equity-based compensation plans;

•	Periodically review, evaluate and report to the Board of Directors concerning the competitiveness of our compensation programs for the named executive officers; and

•	Annually evaluate the Compensation Committee Charter and the Compensation Committee’s performance and make such reports to the Board of Directors as it deems warranted.

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Performance. The Compensation Committee has linked the compensation of our named executive officers to the Company’s attainment of key performance goals. The Compensation Committee considers the individual’s performance and contribution to Company performance and, where applicable, to their business unit performance. The Compensation Committee and Board of Directors believe that tying each named executive officer’s compensation to key performance goals creates an incentive for the executive to attain the Company’s objectives and further align his or her interests with our shareholders.

•	Fairness and Reasonableness. We strive to provide compensation and benefit programs that are fair and competitive with our industry peers, while reasonably rewarding our named executive officers for their service based on their performance.

•	Cost. We strive to provide appropriate incentives and motivation to our named executive officers that will continue to increase value to our shareholders by designing compensation programs that we believe are cost-effective and affordable.

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•	Industry group - insurance carriers and property and casualty insurance

•	Geographic location - national

•	Revenues between $300 million and $3 billion

•	Market capitalization between $200 million and $3.6 billion

(#)	Addition to comparison group from 2015.

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•	a balanced mix of cash-based and equity-based compensation;

•	variable compensation based on a variety of key performance goals, including Company metrics, business unit metrics, where appropriate, and individual performance goals;

•	a balanced mix of short-term and long-term incentives;

•	threshold performance levels that must be achieved to earn incentives;

•	maximum award limits for annual incentive awards and equity-based compensation;

•	time-based vesting requirements for equity-based compensation; and

•	stock ownership guidelines for named executive officers.

•	a fair, reasonable and competitive base salary is essential to attract and retain strong management;

•	annual performance-based cash awards recognize and reward both individual achievement and the named executive officer’s role in overall Company performance; and

•	equity-based compensation helps our named executive officers to “think like owners” and, therefore, aligns their interests with those of our shareholders.

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•

Mr. Ramlo’s performance compared to his goals and objectives for 2015, which included the following: attaining specified targets relating to return on equity, written premium levels, investor visits, underwriting expense ratio and life company income; the expansion of certain business products; generating additional business from newly appointed agents in geographic areas where we are underrepresented; growing certain predetermined areas identified by the Board of Directors; increasing certain business written in our service center; establishing a new unit for specific products; establishing risk and capital statements; and establishing risk tolerance levels for presentation to our Board of Directors;

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factors that could hinder the achievement of Mr. Ramlo’s goals, including: failure to take advantage of market conditions within the insurance industry; failure to successfully integrate technology initiatives while maintaining adequate security within our automation platform; failure to maintain adequate investment portfolio diversity in an attempt to generate higher investment yield; large weather events striking areas where we have heavy concentrations of insured risks; and the loss of key employees;

•	the Company’s performance relative to the insurance industry, with an emphasis on the performance of our peer companies; and

•	Mr. Ramlo’s overall performance as our President and Chief Executive Officer.

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Michael T. Wilkins – Mr. Ramlo and the Compensation Committee based their evaluation of Mr. Wilkins on the following performance and experience criteria: personal lines underwriting experience; the implementation and quality of our reinsurance program in general and our catastrophe coverage in particular, including pricing negotiations; overseeing the long-term profitability of our assumed reinsurance business; evaluation and analysis of our catastrophe exposure; management of our product development and rate setting functions; maintaining industry competitiveness through the use of information technology and web-based applications; the efficiency of our information technology operations; his duties as integration leader related to information technology and cyber-security; his contribution toward the attainment of our corporate return on equity goal; and growth and development in his role as Executive Vice President. Based upon Mr. Ramlo’s report, the Compensation Committee’s overall assessment of Mr. Wilkins’ performance, the executive compensation study, and our current compensation practices, the Compensation Committee recommended, and the Board of Directors approved, an increase in Mr. Wilkins’ 2016 base salary to $470,000, a 4.0% increase over 2015.

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Dawn M. Jaffray – Mr. Ramlo and the Compensation Committee based their evaluation of Ms. Jaffray on the following performance and experience criteria: the timeliness and accuracy of financial reporting; exemplary audit reports; employment and management of staff to perform the internal audit function in-house; continued quality and efficiency of internal controls; growth and development in her role as Chief Financial Officer; duties related to reporting under the Securities Exchange Act of 1934; her successful management of our internal actuary and investor relations staff; her duties as liaison to our institutional investors and the investment community; and her contribution toward the attainment of our corporate return on equity goal. Based upon Mr. Ramlo’s report, the Compensation Committee’s overall assessment of Ms. Jaffray’s performance, the executive compensation study, Ms. Jaffray’s current compensation being in line with the market data discussed above, and our current compensation practices, the Compensation Committee recommended, and the Board of Directors approved, an increase in Ms. Jaffray’s 2016 base salary to $400,000, a 9.6% increase over 2015.

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Barrie W. Ernst – Mr. Ramlo and the Compensation Committee based their evaluation of Mr. Ernst on the following performance and experience criteria: management of our investment portfolio during challenging economic times; maintaining adequate return on investments and cash flow management to meet our ongoing financial obligations; maintaining a net yield on investments comparable to other insurance companies similar to us in size and business model; hiring and management of various outside investment firms, including those responsible for the investments of our defined benefit pension plan; and the ability to limit our exposure to below investment grade securities as identified by the National Association of Insurance Commissioners. Based upon Mr. Ramlo’s report, the Compensation Committee’s overall assessment of Mr. Ernst’s performance, the executive compensation study, Mr. Ernst’s current compensation being in line with the market data discussed above, and our current compensation practices, the Compensation Committee recommended, and the Board of Directors approved, an increase in Mr. Ernst’s 2016 base salary to $345,000, a 3.9% increase over 2015.

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Neal R. Scharmer – Mr. Ramlo and the Compensation Committee based their evaluation of Mr. Scharmer on the following performance and experience criteria: positive management and settlement of claims and other litigation, particularly as related to large or complex losses; negotiation and review of key vendor contracts; hiring and management of various outside legal counsel used by our Company; management of outside legal expenses incurred by our Company; and hiring, development and management of our in-house legal staff. Based upon Mr. Ramlo’s report, the Compensation Committee’s overall assessment of Mr. Scharmer’s performance, the executive compensation study, our current compensation practices, and the fact that certain general counsel functions are currently performed by outside counsel, the Compensation Committee recommended, and the Board of Directors approved, an increase in Mr. Scharmer’s 2016 base salary to $315,000, a 8.6% increase over 2015.

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(1)	Market consensus for named executive officers as determined by FW Cook's Analysis, which used both comparison group data and published survey data.

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•	ROE lower than 4%, plan participants receive no awards;

•	ROE between 4% and 8%, plan participants receive awards equal to 35% of the equity pool;

•	ROE between 8% and 12%, plan participants receive awards equal to 50% of the equity pool;

•	ROE between 12% and 20%, plan participants receive awards equal to 65% of the equity pool; and

•	ROE greater than 20%, plan participants receive awards equal to 80% of the equity pool.

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•	identifies appropriate performance measures and recommends to the Compensation Committee performance targets that the Compensation Committee and the Board of Directors may use to determine annual and long-term incentive awards;

•	develops compensation guidelines for each named executive officer position other than his own;

•	annually recommends to the Compensation Committee the base salary for each executive position other than his own; and

•	briefs each named executive officer on the performance goals and stock ownership guidelines established for that executive’s position.

•	The Compensation Committee identifies appropriate performance measures.

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The Compensation Committee considers the compensation principles discussed under the heading Compensation and Benefits Philosophy as well as each of the Company’s compensation elements, and reviews market data from the executive compensation study. Based on that consideration and review, it annually recommends to the Board of Directors the base salary, annual incentive compensation and long-term incentive awards for our Chief Executive Officer. The Board of Directors reviews and considers the proposals of the Compensation Committee and makes its final determination based on what it believes to be in the interests of the Company and our shareholders.

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•	reviewing and advising on all principal aspects of compensation for named executive officers, including base salaries, equity awards and annual incentive plan awards for named executive officers;

•	reviewing and advising the Compensation Committee on compensation for non-employee directors; and

•	providing advice and input to the Compensation Committee on the identification and selection of appropriate peer companies.

(1)

Equity ownership targets for Mr. Ramlo as a Tier 3 executive were calculated as the number of shares equal to two times his base salary on January 1, 2014 divided by the closing price of Company Common Stock on December 31, 2013. Equity ownership targets for Michael T. Wilkins as a Tier 2 executive were calculated as the number of shares equal to one and one-half times his base salary on January 1, 2014 divided by the closing price of Company Common Stock on December 31, 2013. Equity ownership targets for Dawn M. Jaffray as a Tier 2 executive were calculated as the number of shares equal to one and one-half times her base salary on May 10, 2016 divided by the closing price of Company Common Stock on May 10, 2016. Equity ownership targets for executive officers in Tier 1 were calculated as the number of shares equal to their base salary on January 1, 2014 divided by the closing price of our Company Common Stock on December 31, 2013.

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(2)

Shares held either directly or indirectly and any RSUs (whether vested or unvested) held by the named executive officer are counted toward the target number of shares. Any unexercised stock options (whether vested or unvested) held by the named executive officer are not counted toward the target number of shares. The target number of shares are the number of shares to be held by the named executive officer by December 31, 2019, or within five years of becoming subject to the stock ownership guidelines for officers, whichever is later.

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(1)

Amounts in this column represent the aggregate grant date fair value for options and RSUs, as applicable, granted during 2016, 2015 and 2014. Amounts in this column are calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation - Stock Compensation. To calculate the option amounts we use the Black-Scholes option pricing model. This model estimates the fair value of traded options, which have different characteristics than employee stock options. Changes to the subjective assumptions used in the model can result in materially different fair value estimates. For a discussion of valuation assumptions used, see Note 9 to the Consolidated Financial Statements included in our Company’s Annual Report on Form 10-K for the year ended December 31, 2016.

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(2)

All employees are eligible to participate in our annual performance-based cash award plan if they are in our employ at the time the cash awards for that year are paid. The amounts shown in this column are those amounts earned by the executive for the year shown. These amounts were determined and paid in the subsequent year. For example, any non-equity incentive plan awards shown for 2016 were earned in 2016, but determined and paid in 2017.

(3)

The 2016 amount in this column for Mr. Ramlo represents $6,271 change in accrued pension benefit and $3,344 in above market deferred compensation earnings. The 2016 amount in this column for Ms. Jaffray represents $7,788 change in accrued pension benefit and $0 in above market deferred compensation earnings. The 2016 amount in this column for Mr. Wilkins represents $6,114 change in accrued pension benefit and $1,052 in above market deferred compensation earnings. The 2016 amount in this column for Mr. Ernst represents $5,020 change in accrued pension benefit and $773 in above market deferred compensation earnings. The 2016 amount in this column for Mr. Scharmer represents $8,462 change in accrued pension benefit and $758 in above market deferred compensation earnings.

(4)

The 2016 amount in this column for Mr. Ramlo includes: (a) $5,893 in country club dues paid on Mr. Ramlo’s behalf; (b) $630 in premiums for a Company-sponsored life insurance policy for Mr. Ramlo’s benefit; (c) $444 in parking subsidy for our Company parking ramp; (d) $249,156 in unvested Restoration Benefit Credits contributed by the Company to our Executive Nonqualified Excess Plan on Mr. Ramlo's behalf; and (e) $3,236 in additional income due to personal use of the Company’s airplane.

(5)	The 2016 amount in this column for Ms. Jaffray includes: (a) $630 in premiums for a Company-sponsored life insurance policy for Ms. Jaffray’s benefit; (b) $444 in parking subsidy for our Company parking ramp; and (c) $26,502 in unvested Restoration Benefit Credits contributed by the Company to our Executive Nonqualified Excess Plan on Ms. Jaffray’s behalf.

(6)

The 2016 amount in this column for Mr. Wilkins includes: (a) $9,961 in country club dues paid on Mr. Wilkins’ behalf; (b) $630 in premiums for a Company-sponsored life insurance policy for Mr. Wilkins’ benefit; (c) $444 in parking subsidy for our Company parking ramp; (d) $94,359 in unvested Restoration Benefit Credits contributed by the Company to our Executive Nonqualified Excess Plan on Mr. Wilkins behalf; and (e) $3,236 in additional income due to personal use of the Company’s airplane.

(7)

The 2016 amount in this column for Mr. Ernst includes: (a) $9,142 in country club dues paid on Mr. Ernst’s behalf; (b) $630 in premiums for a Company-sponsored life insurance policy for Mr. Ernst’s benefit; (c) $444 in parking subsidy for our Company parking ramp; and (d) $30,482 in unvested Restoration Benefit Credits contributed by the Company to our Executive Nonqualified Excess Plan on Mr. Ernst's behalf.

(8)	The 2016 amount in this column for Mr. Scharmer includes: (a) $630 in premiums for a Company-sponsored life insurance policy for Mr. Scharmer’s benefit; (c) $444 in parking subsidy for our Company parking ramp; and (d) $33,810 in unvested Restoration Benefit Credits contributed by the Company to our Executive Nonqualified Excess Plan on Mr. Scharmer's behalf.

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•	Options vest 20% each year on the first five anniversaries of the grant date. Options vest immediately if we enter into an agreement to dispose of all or substantially all of our assets or capital stock. The Board of Directors has the authority under the Stock Plan to accelerate vesting of stock options in other circumstances at its discretion.

•	Options expire on the sooner of:

•	ten years after the option grant date;

•	one year after termination of employment for reason of death or disability; or

•	30 days after the termination of employment for any reason other than death or disability, unless extended by the Board of Directors for up to one year after termination of employment.

•	The exercise price is the closing market price for Company Common Stock on the option grant date.

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(1)	We estimate the amounts shown in this column by assuming the achievement of the threshold level for the least-weighted performance measure used in our Annual Incentive Plan and by multiplying 2016 base salary by 6% for Mr. Ramlo; 5% for Mr. Wilkins; 4% for Ms. Jaffray; 1% for Mr. Ernst; and 0.75% for Mr. Scharmer.

(2)	We estimate the amounts shown in this column by assuming the achievement of target levels for all applicable performance measures used in our Annual Incentive Plan and by multiplying 2016 base salary by 60% for Mr. Ramlo; 50% for Mr. Wilkins; 40% for Ms. Jaffray and Mr. Ernst; and 30% for Mr. Scharmer.

(3)	We estimate the amounts shown in this column by assuming the achievement of maximum levels for all applicable performance measures used in our Annual Incentive Plan and by multiplying 2016 base salary by 90% for Mr. Ramlo; 75% for Mr. Wilkins; 60% for Ms. Jaffray and Mr. Ernst; and 45% for Mr. Scharmer.

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(4)	The RSU awards represented in this column vest 100% on the fifth anniversary of the grant date, provided the named executive officer remains employed through the vesting date.

(5)	Option awards represented in this column vest 20% each year for five years beginning with the first anniversary of the grant date, provided the named executive officer remains employed through the applicable vesting date.

(6)

Amounts in this column represent the aggregate grant date fair value for option and RSU awards granted during 2016, calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation - Stock Compensation. To calculate the option amounts, we use the Black-Scholes option pricing model. This model estimates the fair value of traded options, which have different characteristics than employee stock options. Changes to the subjective assumptions used in the model can result in materially different fair value estimates. For a discussion of valuation assumptions used, see Note 9 to the Consolidated Financial Statements included in our Company’s Annual Report on From 10-K for the year ended December 31, 2016.

(7)

There is no specific grant date for awards under our Annual Incentive Plan. We pay awards based on our 2016 performance during the first quarter of 2017. Please see Compensation Discussion and Analysis in this proxy statement for further information regarding the Annual Incentive Plan. Actual amounts paid to each named executive officer under our Annual Incentive Plan for 2016 are shown in the Summary Compensation Table – 2016 in this proxy statement and were calculated based on each individual's base salary for 2016.

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(1)	The unexercisable portion of these options vests one-half each on 2/15/2017 and 02/15/2018.

(2)	The unexercisable portion of these options vests one-third each on 2/21/2017, 2/21/2018 and 2/21/2019.

(3)	The unexercisable portion of these options vests one-fourth each on 2/21/2017, 2/21/2018, 2/21/2019 and 2/21/2020.

(4)	The unexercisable portion of these options vests one-fifth each on 2/19/2017, 2/19/2018, 2/19/2019, 2/19/2020 and 2/19/2021.

(5)	Subject to Mr. Ramlo’s continued employment on the applicable vesting date, 5,304 RSUs vest on 2/15/2018; 9,151 RSUs vest on 2/21/2019; 8,371 RSUs vest on 2/21/2020; and 8,328 vest on 2/19/2021.

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(6)	Subject to Mr. Wilkins’ continued employment on the applicable vesting date, 2,850 RSUs vest on 2/15/2018; 4,934 RSUs vest on 2/21/2019; 4,117 RSUs vest on 2/21/2020; and 4,128 RSUs vest on 2/19/2021.

(7)	Subject to Ms. Jaffray's continued employment on the applicable vesting date, 3,333 RSUs vest on 2/19/2021.

(8)	Subject to Mr. Ernst’s continued employment on the applicable vesting date, 1,933 RSUs vest on 2/15/2018; 2,937 RSUs vest on 2/21/2019; 2,424 RSUs vest on 2/21/2020; and 2,382 RSUs vest on 2/19/2021.

(9)	Subject to Mr. Scharmer’s continued employment on the applicable vesting date, 1,446 RSUs vest on 2/15/2018; 2,484 RSUs vest on 2/21/2019; 2,083 RSUs vest on 2/21/2020; and 2,081 RSUs vest on 2/19/2021.

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(1)	All amounts reported in this column were reported as part of either “Base Salary,” “Non-Equity Incentive Plan Compensation” in the Summary Compensation Table – 2016 in this proxy statement.

(2)

All amounts reported in this column include above-market earnings reported as part of "Change in Pension Value and Nonqualified Deferred Compensation Earnings" in the Summary Compensation Table – 2016 in this proxy statement. For Mr. Ramlo, this amount was $3,344. For Mr. Wilkins, this amount was $1,052. For Mr. Scharmer, this amount was $758. For Mr. Ernst, this amount was $773. For Mr. Scharmer, this amount was $758.

(3)

The amount in this column for Mr. Ramlo includes (i) $277,710 reported as part of either “Base Salary” or “Non-Equity Incentive Plan Compensation” and $3,344 reported as above market deferred compensation earnings in our Summary Compensation Table – 2016; (ii) $200,200 reported as part of either “Base Salary” or “Non-Equity Incentive Plan Compensation” and $2,411 reported as above-market deferred compensation earnings in our 2016 proxy statement; and (iii) $20,000 reported as part of either “Base Salary” or “Non-Equity Incentive Plan Compensation” and $193 reported as above-market deferred compensation earnings in our 2015 proxy statement. At December 31, 2016, $758,574 of Mr. Ramlo’s account balance under the Excess Plan was unvested.

(4)

The amount in this column for Ms. Jaffray includes (i) $12,000 reported as part of either “Base Salary” or “Non-Equity Incentive Plan Compensation” and $0 reported as above market deferred compensation earnings in our Summary Compensation Table – 2016; (ii) $5,475 reported as part of either “Base Salary” or “Non-Equity Incentive Plan Compensation” and $0 reported as above-market deferred compensation earnings in our 2016 proxy statement. At December 31, 2016, $43,350 of Ms. Jaffray's account balance under the Excess Plan was unvested.

(5)

The amount in this column for Mr. Wilkins includes (i) $70,500 reported as part of either “Base Salary” or “Non-Equity Incentive Plan Compensation” and $1,052 reported as above market deferred compensation earnings in our Summary Compensation Table – 2016; (ii) $42,700 reported as part of either “Base Salary” or “Non-Equity Incentive Plan Compensation” and $698 reported as above-market deferred compensation earnings in our 2016 proxy statement; and (iii) $20,000 reported as part of either “Base Salary” or “Non-Equity Incentive Plan Compensation” and $69 reported as above-market deferred compensation earnings in our 2015 proxy statement. At December 31, 2016, $277,644 of Mr. Wilkins’ account balance under the Excess Plan was unvested.

(6)

The amount in this column for Mr. Ernst includes (i) $31,750 reported as part of either “Base Salary” or “Non-Equity Incentive Plan Compensation” and $773 reported as above market deferred compensation earnings in our Summary Compensation Table – 2016; (ii) $27,200 reported as part of either “Base Salary” or “Non-Equity Incentive Plan Compensation” and $607 reported as above-market deferred compensation earnings in our 2016 proxy statement; and (iii) $16,347 reported as part of either “Base Salary” or “Non-Equity Incentive Plan Compensation” and $304 reported as above-market deferred compensation earnings in our 2015 proxy statement. At December 31, 2016, $87,979 of Mr. Ernst’s account balance under the Excess Plan was unvested.

(7)

The amount in this column for Mr. Scharmer includes (i) $29,300 reported as part of either “Base Salary” or “Non-Equity Incentive Plan Compensation” and $758 reported as above market deferred compensation earnings in our Summary Compensation Table – 2016; (ii) $14,740 reported as part of either “Base Salary” or “Non-Equity Incentive Plan Compensation” and $470 reported as above-market deferred compensation earnings in our 2016 proxy statement; and (iii) $13,802 reported as part of either “Base Salary” or “Non-Equity Incentive Plan Compensation” and $36 reported as above-market deferred compensation earnings in our 2015 proxy statement. At December 31, 2016, $34,768 of Mr. Scharmer’s account under the Excess Plan was unvested.

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(1)	At December 31, 2016, none of the named executive officers have achieved normal retirement age under our benefit plans. The figures in this column assume the accelerated vesting by the Board of Directors of all unvested stock options and restricted stock units as applicable.

(2)

Under their existing Change in Control Severance Agreements, the named executive officers are entitled to payment only if their employment is terminated by reason other than a Nonqualifying Termination. Nonqualifying Termination is defined to include (a) by the Company for cause, (b) by the named executive officer for reason other than a good reason, (c) the named executive officer's death, and (d) by the Company due to the executive's absence from the executive's duties with the Company on a full-time basis for a period of 180 consecutive days as a result of the executive's incapacity due to physical or mental illness. In addition, under the terms of the option award agreements, the vesting of unvested stock options will accelerate upon a change in control. In addition to the value associated with stock options, the figures in this column assume the accelerated vesting by the Board of Directors of all restricted stock units.

(3)	Per their existing Change in Control Severance Agreements, the amounts reported in this column as Separation Compensation for the named executive officers equal 1.5 times the executive’s highest annual base salary plus target annual incentive compensation.

(4)	Under the terms of the existing Change in Control Severance Agreements for the named executive officers, if the payments and benefits they are entitled to receive under these agreements would result in the payment of the excise tax imposed by Section 4999 of the Internal Revenue Code, then their payments and benefits

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(5)

We do not make a payment to a participant in our annual incentive plan for a particular year unless the participant is employed by us on the date incentive payments are made, typically in March of the following year. In the case of death or retirement, and at the discretion of our Chairman of the Board and our Chief Executive Officer, we will pay an annual incentive plan payment to a participant prorated to the date of death or retirement. Amounts shown for death and retirement assume our Chairman of the Board and our Chief Executive Officer exercised their discretion to make the payment. The Change in Control Severance Agreements in place for the named executive officers state that they will be paid an amount equal to their target payment under our annual incentive plan for the year in which the change in control occurs, prorated to the date of termination. In this case, termination is presumed to occur on December 31, 2016.

(6)

Upon termination of employment due to death or retirement, the Board of Directors, may at its discretion, accelerate the vesting of any unvested option awards. In addition, under the terms of the option award agreements, the vesting of unvested stock options will accelerate upon a change in control. Amounts shown are calculated using the fair market value of the stock underlying in-the-money options that would have become exercisable on December 31, 2016, assuming that the Board of Directors accelerated the vesting of all unvested options.

(7)	Upon termination of employment due to death, retirement, disability or a change in control not involving termination, the Board of Directors, may at its discretion, accelerate the vesting of any unvested restricted stock unit awards. Amounts shown assumes a voluntary acceleration of vesting by the Board of Directors.

(8)

The Change in Control Severance Agreements for the named executive officers provide for the continuation of medical, accident, disability and life insurance benefits with respect to the named executive officer and his/her dependents for a period of 18 months following a change in control at substantially the same level that existed immediately prior to the change in control. The numbers amounts shown for the named executive officers reflect the cost of these benefits as they existed at December 31, 2016.

(9)	The Change in Control Severance Agreements for the named executive officers provide for outplacement services for a period of 12 months following a change in control. The cost to the Company of these outplacement services is caped for each executive at $15,000.

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(1)	Stock awards represented in this column vest on May 17, 2017 and are subject to forfeiture until vested. At December 31, 2016, there were 1,197 shares of restricted stock outstanding for each non-employee director with the exceptions of: (a) Brenda K. Clancy who joined the board after the grant date; and (b) Douglas Hultquist who had resigned prior to the grant date.

(2)

Amounts in this column represent the aggregate grant date fair value for restricted stock granted during 2016, calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation - Stock Compensation. For a discussion of valuation assumptions used, see Note 9 to the Consolidated Financial Statements included in our Company's Annual Report on Form 10-K for the year ended December 31, 2016.

(3)	Aggregate options outstanding at December 31, 2016 for each of the following non-employee directors were: Besong – 1,755, Carlton – 1,131, Drahozal – 14,354, Evans – 2,456, Hultquist – 14,354, Mahon – 14,354, Milligan – 12,354, Noyce – 9,354, Quass – 14,354, and Skogman – 6,172. Clancy, Gardial and Voss have no options outstanding.

(4)	For Mr. Hultquist, the amount in this column includes $6,250 deferred under the Directors’ Deferred Compensation Plan. At December 31, 2016, Mr. Hultquist’s plan balance, including any accrued dividends, represented 2,407 phantom stock units.

(5)	For Mr. Noyce, the amount in this column includes $0 deferred under the Directors’ Deferred Compensation Plan. At December 31, 2016, Mr. Noyce’s plan balance, including any accrued dividends, represented 3,242 phantom stock units.

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