def14a
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 the Registrant
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Filed by a Party other than the Registrant
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Check the appropriate box: |
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o Preliminary Proxy Statement |
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Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2)) |
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þ Definitive Proxy Statement |
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o Definitive Additional Materials |
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Soliciting Material Pursuant to §240.14a-12 |
VISTEON CORPORATION
(Name
of Registrant as Specified In Its Charter)
(Name
of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
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þ No fee required. |
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Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11. |
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1) Title of each class of securities to which transaction applies: |
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2) Aggregate number of securities to which transaction applies: |
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined): |
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4) Proposed maximum aggregate value of transaction: |
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o Fee paid previously with preliminary materials. |
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o Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing. |
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1) Amount Previously Paid: |
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2) Form, Schedule or Registration Statement No.: |
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SEC 1913 (02-02) |
Persons who are to respond to the collection of information
contained in this form are not required to respond unless the form displays a currently valid
OMB control number. |
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
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DATE:
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WEDNESDAY, MAY 14, 2008
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TIME:
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11:00 AM EASTERN DAYLIGHT TIME
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LOCATION:
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HOTEL DU PONT
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11th & MARKET STREETS
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WILMINGTON, DELAWARE USA
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To Visteon Stockholders,
We invite you to attend our 2008 Annual Meeting of Stockholders
at the Hotel du Pont. At this meeting, you and the other
stockholders will be able to vote on the following proposals,
together with any other business that may properly come before
the meeting:
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1.
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Elect eight directors to the Board of
Directors. The Board has nominated for
re-election William H. Gray, III, Steven K. Hamp, Patricia
L. Higgins, Michael F. Johnston, Karl J. Krapek, Alex J. Mandl,
Richard J. Taggart and James D. Thornton, all current directors.
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2.
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Ratify the appointment of PricewaterhouseCoopers LLP as the
Companys independent registered public accounting firm for
fiscal year 2008. PricewaterhouseCoopers LLP
served in this same capacity in fiscal year 2007.
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3.
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Approve amendments to the Companys 2004 Incentive
Plan.
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4.
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If presented, consideration of a stockholder proposal
regarding special meetings.
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You may vote on these proposals in person or by proxy. If you
cannot attend the meeting, we urge you to vote by proxy, so that
your shares will be represented and voted at the meeting in
accordance with your instructions. Instructions on how to vote
by proxy are contained in the Proxy Statement and in the Notice
of Internet Availability of Proxy Materials. Only stockholders
of record at the close of business on March 24, 2008 will
be entitled to vote at the meeting or any adjournment thereof.
By order of the Board of Directors
Heidi A. Sepanik
Secretary
Van Buren Township, Michigan
March 31, 2008
CONTENTS
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C-1
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VISTEON
CORPORATION
One Village Center Drive
Van Buren Township, Michigan 48111
PROXY
STATEMENT
March 31,
2008
INTRODUCTION
The Board of Directors of Visteon Corporation
(Visteon, the Company, we,
us or our) is soliciting your proxy to
encourage your participation in the voting at the Annual Meeting
of Stockholders. You are invited to attend the Annual Meeting
and vote your shares directly. However, even if you do not
attend, you may vote by proxy. As shown in the Notice of Annual
Meeting, the Annual Meeting will be held on Wednesday,
May 14, 2008, at the Hotel du Pont in Wilmington, Delaware.
Directions to the Hotel du Pont can be found in Appendix C.
IMPORTANT
NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON MAY 14,
2008
Our Notice of Annual Meeting and Proxy Statement, Annual
Report to Stockholders, electronic proxy card and other annual
meeting materials are available on the Internet at
www.proxyvote.com, together with any amendments to any of these
materials that are required to be furnished to stockholders.
The Securities and Exchange Commission, or SEC, recently
adopted rules that allow us to change the way we make our proxy
statement and other annual meeting materials available to you.
The rules require that we mail a notice to our stockholders
advising that our proxy statement, annual report to
stockholders, electronic proxy card and related materials are
available for viewing, free of charge, on the Internet.
Stockholders may then access these materials and vote over the
Internet or request delivery of a full set of materials by mail
or email. We have elected to utilize this new process for the
2008 Annual Meeting. We intend to begin mailing the required
notice, called Notice of Internet Availability of Proxy
Materials, to stockholders on or about March 31, 2008. At
that time, we will also begin mailing paper copies of our proxy
materials to stockholders who requested them in advance. If you
receive a Notice, you will not receive a paper or email copy of
the proxy materials unless you request one in the manner set
forth in the Notice. These new rules give us the opportunity to
serve you more efficiently by making the proxy materials
available quickly online and reducing costs associated with
printing and postage.
The Notice of Internet Availability of Proxy Materials contains
important information, including instructions on how to access
and review the proxy materials online and how to vote your
shares over the Internet or by telephone.
VOTING
How to
Vote Your Shares
If you are a registered stockholder, you can vote at the meeting
any shares that were registered in your name as the stockholder
of record as of the record date. If your shares are held in
street name through a broker, bank or other nominee,
you are not a holder of record of those shares and cannot vote
them at the Annual Meeting unless you have a legal proxy from
the holder of record. If you plan to attend and vote your
street-name shares at the Annual Meeting, you should request a
legal proxy from your broker, bank or holder of record and bring
it with you to the meeting.
Whether or not you plan to attend the meeting, we strongly
encourage you to vote by proxy prior to the meeting. You may
vote your shares prior to the meeting by following the
instructions provided on the Notice of Internet Availability of
Proxy Materials, this proxy statement and the voter website,
www.proxyvote.com. If you requested a paper copy of the proxy
materials, voting instructions are also contained on the proxy
card enclosed with those materials.
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If you are a registered stockholder, there are three ways
to vote your shares before the meeting:
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By Internet (www.proxyvote.com): Use the
Internet to transmit your voting instructions until
11:59 p.m. EDT on May 13, 2008. Have your Notice
of Internet Availability of Proxy Materials with you when you
access the website and follow the instructions to obtain your
records and to create an electronic voting instruction form.
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By telephone
(1-800-690-6903): Use
any touch-tone telephone to submit your vote until
11:59 p.m. EDT on May 13, 2008. Have your Notice
of Internet Availability of Proxy Materials in hand when you
call and then follow the instructions you receive from the
telephone voting site.
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By mail: If you requested a paper copy of the
proxy materials, mark, sign and date the proxy card enclosed
with those materials and return it in the postage-paid envelope
we have provided. To be valid, proxy cards must be received
before the start of the Annual Meeting. Proxy cards should be
returned to Visteon Corporation,
c/o Broadridge,
51 Mercedes Way, Edgewood, NY 11717.
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If your shares are held in street name, your broker, bank
or other holder of record may provide you with a Notice of
Internet Availability of Proxy Materials. Follow the
instructions on the Notice to access our proxy materials and
vote online or to request a paper or email copy of our proxy
materials. If you received these materials in paper form, the
materials included a voting instruction card so you can instruct
your broker, bank or other holder of record how to vote your
shares.
You should provide voting instructions for all proposals
appearing on the proxy/voting instruction card. The persons
named as proxies on the proxy card will vote your shares
according to your instructions. However, if you do not provide
voting instructions with your proxy, then the designated proxies
will vote your shares for the election of the nominated
directors, for the ratification of the Companys
independent registered public accounting firm, for the approval
of the amendments to the 2004 Incentive Plan and against the
shareholder proposal. If any nominee for election to the Board
is unable to serve, which is not anticipated, or if any other
matters properly come before the meeting, then the designated
proxies will vote your shares in accordance with their best
judgment.
How to
Revoke Your Proxy
If you are a registered stockholder, you can revoke your proxy
and change your vote at any time prior to the Annual Meeting by:
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Notifying our Corporate Secretary in writing at One Village
Center Drive, Van Buren Township, Michigan 48111 (the
notification must be received by the close of business on
May 13, 2008);
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Voting again by Internet or telephone prior to
11:59 p.m. EDT on May 13, 2008 (only the latest
vote you submit will be counted); or
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Submitting a new properly signed and dated paper proxy card with
a later date (your proxy card must be received before the start
of the Annual Meeting).
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If your shares are held in street name, you should contact your
broker, bank or other holder of record about revoking your
voting instructions and changing your vote prior to the meeting.
If you are eligible to vote at the Annual Meeting, you also can
revoke your proxy or voting instructions and change your vote at
the Annual Meeting by submitting a written ballot before the
polls close.
Stockholders
Entitled to Vote and Ownership
You are entitled to one vote at the Annual Meeting for each
share of the Companys common stock that you owned of
record at the close of business on March 24, 2008. As of
March 17, 2008, the Company had issued and outstanding
130,050,038 shares of common stock. Information regarding
the holdings of the Companys stock by directors, executive
officers and certain other beneficial owners can be found
beginning on page 9.
A list of the stockholders of record entitled to vote at the
Annual Meeting will be available for review by any stockholder,
for any purpose related to the meeting, between 9:00 a.m.
and 5:00 p.m. at the principal offices of the
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Company, located at One Village Center Drive, Van Buren
Township, Michigan 48111, for ten days before the meeting.
Required
Vote to Approve the Proposals
The Companys By-Laws require that a majority of the
Companys common stock be represented at the Annual
Meeting, whether in person or by proxy, for the quorum that is
needed to transact any business.
Election of Directors. The affirmative vote of
a plurality of the votes cast at the meeting is required for the
election of directors. A properly executed proxy marked to
withhold authority with respect to the election of one or more
directors will not be voted with respect to the director or
directors indicated, although it will be counted for purposes of
determining whether there is a quorum.
Other Proposals. For each proposal other than
the election of directors, the affirmative vote of the holders
of a majority of the shares represented in person or by proxy
and entitled to vote on the item will be required for approval.
A properly executed proxy marked Abstain with
respect to any such matter will not be voted, although it will
be counted for purposes of determining whether there is a
quorum. Accordingly, an abstention will have the effect of a
negative vote.
If you hold your shares in street name through a broker or other
nominee and you do not give voting instructions at least ten
days before the meeting to your broker or other nominee, then
your broker or other nominee may exercise voting discretion only
with respect to matters considered to be routine by
the New York Stock Exchange, such as the election of directors
and the ratification of the appointment of the independent
registered public accounting firm. On
non-routine
matters, such as amending the incentive plan and the shareholder
proposal, the brokers or other nominees cannot vote your shares
absent voting instructions from the beneficial holder, resulting
in so-called
broker non-votes. Broker non-votes are not deemed to
be votes cast, and as a result have no effect on the outcome of
any matters presented, but will be counted in determining
whether there is a quorum.
Where to
Find Voting Results
The Company will publish the voting results in its quarterly
report on
Form 10-Q
for the second quarter of 2008, which we plan to file with the
Securities and Exchange Commission on or prior to
August 11, 2008. You will also find the results in the
investor information section of the Companys website
(www.visteon.com/investors).
Cost of
Solicitation
The Company will pay for soliciting these proxies. The
Companys directors, officers and employees may solicit
proxies in person or by telephone, mail, email, telecopy or
letter. The Company has also retained Georgeson Inc. to assist
it in distributing proxy solicitation materials and soliciting
proxies at a cost of approximately $10,000, plus reasonable
out-of-pocket expenses. The Company will reimburse brokers and
other nominees for their reasonable out-of-pocket expenses for
forwarding proxy materials to beneficial owners.
ITEM 1.
ELECTION OF DIRECTORS
The first proposal on the agenda for the Annual Meeting will be
electing eight directors to hold office until the Annual Meeting
of Stockholders to be held in 2009. We expect each nominee for
election as a director to be able to serve if elected. If any
nominee is not able to serve, proxies will be voted in favor of
the remainder of those nominated and may be voted for substitute
nominees, unless the Board chooses to reduce the number of
directors serving on the Board. The nominees receiving the
greatest number of votes cast will be elected. All of the
nominees are current directors who have been elected by
stockholders at previous annual meetings, other than
Mr. Hamp, who was recommended to the Corporate Governance
and Nominating Committee as a director candidate by the
non-management
directors and our Chairman and CEO, Mr. Mandl, who was
recommended to the Corporate Governance and Nominating Committee
as a director candidate by the non-management directors, and
Mr. Taggart, who was recommended to the Corporate
Governance and Nominating Committee as a director candidate by
an outside director recruitment firm.
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The Board of Directors Recommends that You Vote FOR the
Election of William H. Gray, III, Steven K. Hamp, Patricia
L. Higgins, Michael F. Johnston, Karl J. Krapek, Alex J. Mandl,
Richard J. Taggart and James D. Thornton as
Directors.
Nominees
for Directors
William H. Gray, III is 66 years old, and he
has been a director of the Company since June 2000.
Mr. Gray has been Chairman of the Amani Group, a consulting
and advisory firm, since August 2004. Prior to that he was
President and Chief Executive Officer of the United Negro
College Fund from September 1991 to March 2004. Mr. Gray
served as a Congressman from the Second District of Pennsylvania
from 1979 to 1991, and at various times during his tenure,
served as Budget Committee Chair and House Majority Whip. He
also serves as a director of Dell Inc., J.P. Morgan
Chase & Co., Pfizer, Inc., and Prudential Financial,
Inc.
Steven K. Hamp is 59 years old, and he has been a
director of the Company since March 2008. Mr. Hamp has been
the principal of Hamp Advisors LLC, a strategy consulting firm,
since March 2007, and prior to that, he was the Vice President
and Chief of Staff of Ford Motor Company, a global automotive
vehicle manufacturer, a position he held from November 2005 to
October 2006. Before joining Ford, Mr. Hamp served as the
President of The Henry Ford, a non-profit organization
sponsoring historic exhibits. Mr. Hamp previously served as
a Director of the Company from January 2001 to November 2005.
Patricia L. Higgins is 58 years old, and she has
been a director of the Company since September 2004.
Ms. Higgins is the former President and CEO of Switch and
Data, a leading neutral interconnection and collocation
provider, a position she held from September 2000 to February
2004. Prior to that, she was Chairman and CEO of The Research
Board, a business unit of the Gartner Group, for which she also
served as an Executive Vice President since January 1999.
Ms. Higgins also serves on the board of directors of Barnes
and Noble, Inc., Internap Network Services Corporation, and the
Travelers Companies.
Michael F. Johnston is 60 years old, and he has been
Chairman of the Board and Chief Executive Officer of Visteon
since June 2005, and a member of the Board of Directors since
May 2002. Prior to that, he was Chief Executive Officer and
President since July 2004, and President and Chief Operating
Officer since joining the Company in September 2000.
Mr. Johnston is also a director of Flowserve Corporation
and Whirlpool Corporation.
Karl J. Krapek is 59 years old, and he has been a
director of the Company since February 2003. Mr. Krapek is
the former President and Chief Operating Officer of United
Technologies Corporation, a global supplier of aerospace and
building systems products, a position he held from April 1999 to
January 2002. Prior to that he served as President of United
Technologies Pratt and Whitney division since 1992.
Mr. Krapek also serves as a director of Alcatel-Lucent,
Prudential Financial, Inc. and The Connecticut Bank and
Trust Company.
Alex J. Mandl is 64 years old, and he has been the
Chairman of Gemalto N.V., a global provider of digital security
solutions, since December 2007. Prior to that he was the
Executive Chairman of Gemalto since June 2006. Mr. Mandl
has also served as the President and Chief Executive Officer and
a member of the Board of Directors of Gemplus International
S.A., a provider of secure card solutions, positions he held
since August 2002. He has served as Principal of ASM
Investments, a company focusing on early stage funding in the
technology sector, since April 2001. Mr. Mandl is also
a director of Dell, Inc., Hewitt Associates, Inc., and Horizon
Lines.
Richard J. Taggart is 65 years old and he has been a
director of the Company since December 2006. Mr. Taggart is
the former Executive Vice President and Chief Financial Officer
of Weyerhaeuser Company, a forest products company, a position
he held from April 2003 to June 2007. Prior to that,
Mr. Taggart served as Weyerhaeusers Vice President,
Finance since October 2001. He also serves as a director of
3TIER Inc., a private energy assessment and forecasting
company.
James D. Thornton is 59 years old, and he has been a
director of the Company since September 2004. Mr. Thornton
is the former Senior Executive Vice President and Director of
Diversity, Recruitment and People Services for MBNA America
Bank, N.A., a credit card lending company. Prior to that, he
held various leadership positions including Director of Quality
Assurance and Director of Sports Marketing, Regional
Director Mid-Atlantic Region for MBNA America Bank.
Mr. Thornton is also chairman of the board of trustees of
Talladega College.
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Continuing
Directors Whose Terms Expire in 2009
Charles L. Schaffer is 62 years old, and he has been
a director of the Company since January 2001. Mr. Schaffer
is the former Chief Operating Officer of United Parcel Service,
Inc., a global provider of package delivery services.
Donald J. Stebbins is 50 years old and has been
Visteons President and Chief Operating Officer since
joining the Company in May 2005, and a member of the Board of
Directors since December 2006. Before joining Visteon,
Mr. Stebbins served as President and Chief Operating
Officer of operations in Europe, Asia and Africa for Lear
Corporation, an automotive supplier, since August 2004 and prior
to that he was President and Chief Operating Officer of
Lears operations in the Americas since September 2001.
Mr. Stebbins also serves as a director of WABCO Holdings
Inc.
Kenneth B. Woodrow is 63 years old, and he has been
a director of the Company since October 2004. Mr. Woodrow
is the former Vice Chairman of Target Corporation, a retail
sales company, a position he held from 1999 until his retirement
in December 2000. Prior to that, he was the President of Target
Stores since 1994. Mr. Woodrow is also a director of Delta
Air Lines, Inc. and
E-Z Gard
Industries, Inc.
CORPORATE
GOVERNANCE
Meetings
During 2007, the Board of Directors held nine regularly
scheduled and special meetings. Under the Companys
Corporate Governance Guidelines, directors are expected to
attend all scheduled Board and committee meetings as well as the
Companys Annual Meeting of Stockholders. No director
attended less than 75% of the aggregate number of meetings of
the Board and Board committees on which he or she served during
2007. All directors attended the 2007 Annual Meeting of
Stockholders.
Pursuant to the Corporate Governance Guidelines, the
non-employee directors meet without management at the end of
every regularly scheduled Board meeting, and the independent
directors meet without management at least once per year. The
presiding director at these meetings is the most tenured
independent director in attendance.
Director
Independence
The Corporate Governance Guidelines adopted by the Board of
Directors provide that a majority of the members of the Board,
and each member of the Audit, Organization and Compensation, and
Corporate Governance and Nominating committees, must meet the
independence criteria of the listing standards of the New York
Stock Exchange and other applicable law. For a director to be
considered independent, the Board must determine that the
director does not have any direct or indirect material
relationship with the Company. To assist it in determining
director independence, the Board of Directors has adopted the
Visteon Director Independence Guidelines, which are set forth as
Exhibit A to this Proxy Statement. The Visteon Director
Independence Guidelines contain categorical standards of
independence which conform to, or are more exacting than, the
independence definitions in the New York Stock Exchange listing
standards. In addition to applying its guidelines, the Board
will consider all relevant facts and circumstances that it is
aware of in making an independence determination.
The Board undertook its annual review of director independence
in March 2008, and, based on the listing standards of the New
York Stock Exchange and the Visteon Director Independence
Guidelines, the Board has affirmatively determined that all but
one of the non-employee directors, namely Ms. Higgins and
Messrs. Gray, Krapek, Mandl, Schaffer, Taggart, Thornton
and Woodrow, are independent. None of these non-employee
directors had any relationship with the Company (other than as a
director or stockholder). Messrs. Johnston and Stebbins,
are not independent due to their employment as senior executives
of the Company. Mr. Hamp is also not independent because
his
brother-in-law
is an executive officer of a significant customer of the Company.
Committees
The Board has established five standing committees. The
principal functions of each committee are briefly described on
the following pages.
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Audit
Committee
The Board has a standing Audit Committee, currently consisting
of Charles L. Schaffer (Chair), Karl J. Krapek, Alex J. Mandl,
Richard J. Taggart and Kenneth B. Woodrow, all of whom are
considered independent under the New York Stock Exchange
listing standards, the rules and regulations of the Securities
and Exchange Commission and the Visteon Director Independence
Guidelines. The Board has determined that each of the current
members of the Audit Committee is qualified as an audit
committee financial expert within the meaning of the rules
and regulations of the Securities and Exchange Commission, and
has accounting and related financial management
expertise within the meaning of the listing standards of
the New York Stock Exchange. During 2007, the Audit Committee
held eleven regularly scheduled and special meetings. The duties
of the Audit Committee are generally:
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to appoint and evaluate the independent auditor;
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to approve all audit and non-audit engagement fees and terms;
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to review the activities and the reports of the Companys
independent auditors;
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to review internal controls, accounting practices, financial
structure and financial reporting, including the results of the
annual audit and review of interim financial statements;
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to review and monitor compliance procedures; and
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to report the results of its review to the Board.
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The charter of the Audit Committee, as well as any future
revisions to such charter, is available on the Companys
website at www.visteon.com/investors. The Audit Committee Report
can be found beginning on page 39.
Organization
and Compensation Committee
The Board also has a standing Organization and Compensation
Committee, consisting of Karl J. Krapek (Chair), William H.
Gray, III, Patricia L. Higgins, Charles L. Schaffer and
James D. Thornton, all of whom are considered independent under
the New York Stock Exchange listing standards and the Visteon
Director Independence Guidelines. During 2007, the Organization
and Compensation Committee held seven regularly scheduled and
special meetings and took action by written consent two times in
lieu of additional meetings.
The Organization and Compensation Committee oversees the
Companys programs for compensating executive officers and
other key management employees, including the administration of
the Companys equity-based compensation plans, and approves
the salaries, bonuses and other awards to executive officers.
Other duties of the Organization and Compensation Committee are
generally:
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to review and approve corporate goals and objectives relative to
the compensation of the Chief Executive Officer, evaluate the
Chief Executive Officers performance and set the Chief
Executive Officers compensation level based on this
evaluation;
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to review and approve executive compensation and incentive plans;
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to approve the payment of cash performance bonuses and the
granting of stock based awards to the Companys employees,
including officers; and
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to review and recommend management development and succession
planning.
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The Chairman and Chief Executive Officer of the Company, with
the consultation of the Senior Vice President, Human Resources,
provides recommendations to the committee on the amount and
forms of executive compensation, and assists in the preparation
of committee meeting agendas. Pursuant to the Companys
2004 Incentive Plan, the committee may delegate its power and
duties under such plan to a committee consisting of two or more
officers of the Company except in respect of individuals subject
to the reporting or liability provisions of Section 16 of
the Securities Exchange Act of 1934, as amended. The committee
has authorized the Senior Vice President, Human Resources,
together with the Vice President and Treasurer, to approve
awards of up to 50,000 stock options
and/or stock
appreciation rights (subject to an annual limit of 500,000 stock
options
and/or stock
appreciation rights) and up to 25,000 shares of restricted
stock and/or
restricted stock units (subject to an annual limit of
250,000 shares of restricted stock
and/or
restricted stock units) to individuals the Company desires to
hire or retain, except any individual who is or upon commencing
employment will be subject to the liability provisions of
Section 16 of the Securities Exchange Act of 1934, as
amended.
Further, the committee has the authority to retain, approve the
fees and other terms of, and terminate any compensation
consultant, outside counsel or other advisors to assist the
committee in fulfilling its duties. For additional information
regarding the roles and processes involved in the consideration
and determination of executive compensation, including the role
of compensation consultants, see Compensation Discussion
and Analysis. The charter of the Organization and
Compensation Committee, as well as any future revisions to such
charter, is available on the Companys website at
www.visteon.com/investors. The Compensation Committee Report can
be found beginning on page 11.
Corporate
Governance and Nominating Committee
The Board also has a standing Corporate Governance and
Nominating Committee, consisting of
William H. Gray, III (Chair), Karl J.
Krapek, James D. Thornton and Kenneth B. Woodrow, all of whom
are considered independent under the New York Stock Exchange
listing standards and the Visteon Director Independence
Guidelines. During 2007, the Corporate Governance and Nominating
Committee held four regularly scheduled meetings. The duties of
the Corporate Governance and Nominating Committee are generally:
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to develop corporate governance principles and monitor
compliance therewith;
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to review the performance of the Board as a whole;
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to review and recommend to the Board compensation for outside
directors;
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to develop criteria for Board membership; and
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to identify, review and recommend director candidates (see
Director Nomination Process, below).
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The charter of the Corporate Governance and Nominating
Committee, as well as any future revisions to such charter, is
available on the Companys website at
www.visteon.com/investors.
Corporate
Responsibility Committee
The Board has a standing Corporate Responsibility Committee,
consisting of James D. Thornton (Chair),
Steven K. Hamp and Patricia L. Higgins. During 2007,
the Corporate Responsibility Committee held four regularly
scheduled meetings. The duties of the Corporate Responsibility
Committee are generally:
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to review and monitor the worldwide performance of the Company
as it affects the environment, employees, communities and
customers; and
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to develop recommendations to management to assist it in
formulating and adopting policies, programs, practices and
strategies concerning corporate citizenship and public policy
matters.
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The charter of the Corporate Responsibility Committee, as well
as any future revisions to such charter, is available on the
Companys website at www.visteon.com/investors.
7
Finance
Committee
The Board has a standing Finance Committee, consisting of
Patricia L. Higgins (Chair), Steven K. Hamp,
Alex J. Mandl, Richard J. Taggart and Kenneth B.
Woodrow. During 2007, the Finance Committee held four regularly
scheduled meetings. The duties of the Finance Committee
generally are:
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to review and make recommendations to the Board regarding the
Companys cash flow, capital expenditures and financing
requirements;
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to review the Companys policies with respect to financial
risk assessment and management including investment strategies
and guidelines;
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to review and make recommendations on mergers, acquisitions and
other major financial transactions requiring Board
approval; and
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to consider and recommend to the Board stock sales, repurchases
or splits, as appropriate, and any changes in dividend policy.
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The charter of the Finance Committee, as well as any future
revisions to such charter, is available on the Companys
website at www.visteon.com/investors.
Director
Nomination Process
The Corporate Governance and Nominating Committee assesses all
director candidates, whether submitted by management or a
stockholder, and recommends nominees for election to the Board.
Recommendations for election are based upon the nominees
intelligence, judgment, foresight, personal character,
experience and achievements, and diversity of background and
expertise as compared to the present
make-up of
the Board. The Corporate Governance and Nominating Committee has
the authority to retain consultants to assist with director
recruitment. During 2007, the Corporate Governance and
Nominating Committee retained, at the expense of the Company, a
search firm to assist with identifying and assessing potential
director candidates.
Each year, the Corporate Governance and Nominating Committee
reviews all eligible director candidates, including incumbents.
The committee then decides, based upon the pool of eligible
candidates and the number of vacancies to be filled, whom to
recommend to the Board to be nominated for election that year.
The full Board reviews the committees recommendations and
approves the individuals to stand for election. This is the
process that was used to identify and evaluate the current
nominees standing for election that appear in this proxy
statement.
The Corporate Governance and Nominating Committee welcomes
stockholder recommendations of director candidates. Stockholders
may suggest candidates for the consideration of the committee by
submitting their suggestions in writing to the Companys
Secretary, including the agreement of the nominee to serve as a
director. In addition, the Companys By-Laws contain a
procedure for the direct nomination of director candidates by
stockholders (see page 47), and any such nomination will
also be automatically submitted to the Corporate Governance and
Nominating Committee for consideration. No individuals were
proposed as director candidates for this Annual Meeting by any
stockholder.
Communications
with the Board of Directors
Stockholders and other persons interested in communicating
directly with a committee chairperson or with the
non-management
directors as a group may do so as described on the
Companys website
(www.visteon.com/investors),
or by writing to the chairperson or non-management directors
c/o of
the Company Secretary, One Village Center Drive, Van Buren
Township, Michigan 48111.
8
STOCK
OWNERSHIP
The following contains information regarding the stock ownership
of the nominees for election as directors, the directors
continuing in office, the Companys executive officers and
beneficial owners of more than five percent of the
Companys voting securities.
Ownership of the Companys common stock is shown in terms
of beneficial ownership. A person generally
beneficially owns shares if he or she has either the
right to vote those shares or dispose of them, and more than one
person may be considered to beneficially own the same shares.
In this proxy statement, unless otherwise noted, a person has
sole voting and dispositive power for those shares shown as
beneficially owned by him or her. The percentages shown in this
proxy statement compare the persons beneficially owned
shares with the total number of shares of the Companys
common stock outstanding on March 5, 2008
(130,050,038 shares).
Nominees,
Continuing Directors and Executive Officers
The following table contains stockholding information for the
nominees for election as directors, the directors continuing in
office and the Companys executive officers, as well as
stock units credited to their accounts under various
compensation and benefit plans as of March 5, 2008. No
shares have been pledged as collateral for loans or other
obligations by any director or executive officer listed below.
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Common Stock
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Beneficially Owned
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Percent of
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Stock
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Name
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Number(1)
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Outstanding
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Units(2)(3)
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William H. Gray, III
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3,259
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*
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37,412
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Steven K. Hamp
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0
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*
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33,398
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Patricia L. Higgins
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0
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*
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26,753
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Michael F. Johnston
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1,888,998
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1.4
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1,643,187
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Karl J. Krapek
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0
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*
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89,850
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Alex J. Mandl
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25,000
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*
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0
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Charles L. Schaffer
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0
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*
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111,319
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Donald J. Stebbins
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436,922
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*
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816,873
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Richard J. Taggart
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0
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*
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8,750
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James D. Thornton
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1,000
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*
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26,753
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Kenneth B. Woodrow
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15,000
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*
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65,715
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William G. Quigley III
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118,099
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*
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335,133
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John Donofrio
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132,362
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*
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215,665
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Joel Coque
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48,148
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*
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42,460
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John F. Kill
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244,528
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*
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54,209
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All Directors and Executive Officers as a Group
(21 Persons)
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3,251,633
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2.5
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4,247,525
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*
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Less than 1%.
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(1)
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Includes shares of common stock
which the following executive officers had a right to acquire
ownership of pursuant to options granted by the Company
exercisable on or within 60 days after March 5, 2008:
Mr. Johnston (1,606,426 shares); Mr. Stebbins
(386,922 shares); Mr. Quigley (98,099 shares)
Mr. Donofrio (107,362 shares); Mr. Coque
(48,148 shares); and Mr. Kill (224,002 shares).
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(2)
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For non-employee directors, the
amounts shown include stock units credited under the Deferred
Compensation Plan for Non-Employee Directors and the
Non-Employee Director Stock Unit Plan, and are payable following
termination of Board service in cash or shares of stock at the
election of the Company.
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(3)
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For executive officers the amounts
shown include Visteon stock units credited under the Visteon
Deferred Compensation Plan, which are payable in cash following
termination of employment, and restricted stock units awarded
under the 2004 Incentive Plan, which vest after one to three
years from award and will be settled in cash (or, in certain
circumstances, stock at the election of the Company).
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9
Other
Beneficial Owners
The Company believes that the following table is an accurate
representation of beneficial owners of more than 5% of any class
of the Companys voting securities as of March 5,
2008. The table is based upon reports on Schedules 13G and 13D
and Forms 4 filed with the Securities and Exchange
Commission or other information believed to be reliable.
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Name and Address
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Amount and Nature
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Percent of
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Title of Class
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of Beneficial Owner
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of Ownership
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Class
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Common Stock
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Pardus Capital Management L.P.
590 Madison Ave, Suite 25E
New York, NY 10022
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30,100,000 shares held with sole voting power and
30,100,000 shares held with sole dispositive power
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23.4%
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Common Stock
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Donald Smith & Co., Inc.
152 West 57th Street
New York, NY 10019
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11,786,000 shares held with sole voting power and
12,976,800 with sole dispositive power
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10.0%
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Common Stock
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FMR LLC
82 Devonshire Street
Boston, MA 02109
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117 shares held with sole voting power and 8,629,217 held
with sole dispositive power
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6.649%
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Common Stock
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Brandes Investment Partners, L.P.
Brandes Investment Partners, Inc.
Brandes Worldwide Holdings, L.P.
Charles H. Brandes
Glenn R. Carlson
Jeffrey A. Busby
11988 El Camino Real, Suite 500
San Diego, CA 92130
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6,111,322 shares held with shared voting power and
7,644,936 shares held with shared dispositive power
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5.89%
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Common Stock
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Ronald Gutfleish
Elm Ridge Capital Management, LLC
3 West Main Street,
3rd
Floor
Irvington, NY 10533
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7,508,251 shares held with shared voting power and
7,508,251 shares held with shared dispositive power
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5.8%
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SECTION 16(a)
BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as
amended, requires the Companys executive officers,
directors and greater than 10% stockholders to file certain
reports (Section 16 Reports) with respect to
their beneficial ownership of the Companys equity
securities. Based solely on a review of copies of reports
furnished to the Company, or written representations that no
reports were required, the Company believes that during 2007 all
Section 16 Reports that were required to be filed were
filed on a timely basis.
TRANSACTIONS
WITH RELATED PERSONS
Our Ethics and Integrity Policy instructs all employees of
Visteon, including the Named Executive Officers, to avoid
conflicts between personal interests and the interests of
Visteon, as well as any action that has the potential for
impacting the Company adversely or interfering with the
employees objectivity. The policy also requires any
employee having a financial interest in, or a consulting,
managerial or employment relationship with, a competitor,
customer, supplier or other entity doing business with Visteon
to disclose the situation to their manager or to the legal or
human resources departments of the Company. The Companys
compliance group implements the Ethics and Integrity Policy and
related policies and annually requires all management employees,
including the Named Executive Officers, to complete a
questionnaire disclosing potential conflicts of interest
transactions. In addition, the Audit Committee is responsible
for overseeing our ethics and compliance program, including
compliance with the Ethics and Integrity Policy, and all members
of the Board are responsible for complying with such policy. The
Corporate Governance and Nominating Committee reviews the
professional occupations and associations of board nominees, and
annually reviews transactions between Visteon and other
companies with which our Board members and executive officers
are affiliated to the extent reported in response to our
directors and officers questionnaire. Our Ethics and Integrity
Policy is in writing. See page 48 of this proxy statement
under Miscellaneous for instructions on how to
obtain a copy.
10
In early 2005, purported class and stockholder derivative
actions were filed in federal and state courts in Michigan
against the Company, the non-employee directors and certain
Named Executive Officers. These actions include: (i) a
purported class action alleging that the Company, certain of its
current and former officers and its independent registered
public accounting firm violated federal securities laws by
making materially misleading statements; (ii) purported
stockholder derivative actions alleging that certain of the
Companys current and former officers and directors
breached their fiduciary duties in connection with the matters
alleged in the securities class action discussed immediately
above; and (iii) purported class actions alleging that
certain current and former employees, officers and directors
breached their fiduciary duties under the Employee Retirement
Income Security Act (ERISA) by, among other things,
continuing to offer the Companys stock as an investment
alternative under the Visteon Investment Plan and the Visteon
Savings Plan for Hourly Employees
and/or
failing to disclose complete and accurate information regarding
the prudence of investing in the Companys stock. The
parties have reached settlements of the ERISA and purported
stockholder derivative matters. Pursuant to the indemnification
provision contained in the Companys Amended and Restated
By-laws, the Company is paying the expenses (including
attorneys fees) incurred by the defendants in defending
these actions where not covered by insurance policies.
Mr. Hamp is the
brother-in-law
of William Clay Ford, Jr., the Executive Chairman of Ford
Motor Company. Ford is currently the Companys largest
customer and Ford and the Company have engaged, and are expected
to engage, in a number of commercial and other transactions
having values in excess of $120,000 in the ordinary course of
their businesses. The Corporate Governance and Nominating
Committee reviewed this relationship in connection with
Mr. Hamps election to the Board.
COMPENSATION
COMMITTEE REPORT
The Organization and Compensation Committee of the Board of
Directors (hereafter referred to as the Committee)
oversees the Companys programs for compensating executive
officers and other key management employees, including the
administration of the Companys equity-based compensation
plans, and approves the salaries, bonuses and other awards to
executive officers. The Committee has reviewed and discussed the
Compensation Discussion and Analysis below with management of
the Company, and, based on such review and discussion, the
Committee has recommended to the Board of Directors that the
compensation discussion and analysis so stated be included in
this Proxy Statement.
Organization and Compensation Committee
Karl J. Krapek (Chairman)
William H. Gray, III
Patricia L. Higgins
Charles L. Schaffer
James D. Thornton
11
EXECUTIVE
COMPENSATION
Compensation
Discussion and Analysis
Executive
Compensation Program Objectives
Overview
The Company believes that an experienced, motivated and
effective executive team is critical to the long-term success of
its business. Thus, the primary objectives of the Companys
executive compensation program are to recruit, motivate and
retain highly qualified executives. In meeting its primary
objectives, the Company has structured its executive
compensation program to support the Companys strategic
plans and objectives, including compensation program costs, and
provides strong alignment of the interests of its executives
with the creation of stockholder value.
The mix and total amount of compensation in any year reflects
market competitive practices, the realities of the
Companys financial position and its industry. The Company
believes that the proportion of variable, or at
risk, compensation should increase as an employees
level of responsibility increases.
Benchmarking
Considerations
The Company and the Committee use competitive market data to
inform their decision-making processes on elements of the
Companys compensation and benefits programs. Although the
Company and the Committee use the market-based ranges derived
from surveys and studies compiled by compensation consultants,
and other available market data, neither the Company nor the
Committee attempts to set all compensation elements for all
executives within a particular market-based range. Rather, the
Company and the Committee evaluate additional factors, such as
individual experience and performance, organizational level
(internal relationships) and critical need for the position when
executives have been recruited externally.
For executive level positions, pay ranges have been developed
using Towers Perrins U.S. Compensation Data Bank
(CBD) General Industry Executive Database (approximately
1,000 companies) and Hewitt Associates Total
Compensation
Measurementtm
database (approximately 800 companies).
The firm of Frederic W. Cook & Co., Inc., an
independent executive compensation consulting firm, advises the
Committee on competitive market practices and trends as well as
on specific executive compensation matters as requested by the
Committee. The Company maintains no other direct or indirect
business relationships with this firm.
Roles
and Processes
The Committee oversees the Companys programs for
compensating executive officers and other key management
employees, including the administration of the Companys
equity-based compensation plans, and approving the salaries,
incentive awards and other compensation paid to executive
officers. The Chief Executive Officer and Senior Vice President,
Human Resources develop and present executive compensation
program recommendations to the Committee, including summaries of
the results of survey data provided by the Companys
compensation consultants.
The Committee reviews and approves routine executive
compensation matters, including the determination of final
incentive awards for preceding periods and the salary and
incentive awards (including equity-based awards) for the current
year generally during its regularly-scheduled meeting or
meetings in the first quarter. The process is designed to link
annual performance reviews with the determination of base
salaries and incentive awards. The annual review of long-term
incentives and equity grants occurs during the Committees
regularly scheduled meeting in the first quarter of the each
year. Stock option and stock appreciation right exercise prices
are set at the fair market value of our stock on the date of
grant, which under the terms of the Companys incentive
plan is the average of the high and low price of Visteon stock
on such date. The Committee may also make individual grants from
time to time. The Committee does not time the grant of
equity-based awards to take advantage of material non-public
information nor does the Committee take into account the
prevailing trading prices of the Companys common stock on
the timing of awards in any way.
12
The Companys Annual and Long-Term Incentive programs are
administered by the Committee pursuant to the terms of the
Visteon Corporation 2004 Incentive Plan. During the first
quarter of each year, the Committee approves the mix of
compensation elements and metrics for the performance-based
elements, including target and threshold levels, with the advice
and assistance of management. The Committee often retains
discretion to modify or adjust metrics to take into account the
disposition of businesses
and/or
facilities and other factors. After the completion of the
performance period, the Committee reviews actual performance
against each metric and determines the final payout, if any,
based on performance relative to each metric. The Committee has
discretionary authority to lower and, except in the case of
certain covered executives (including the Named Executive
Officers as defined below), raise final awards.
Primary
Elements of Compensation for Named Executive Officers
To meet the Companys goals for executive compensation, the
Company provides:
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a base salary;
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an annual performance-based cash incentive;
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annual awards under a long-term incentive program, comprised of:
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|
|
i.
|
a performance-based cash incentive earned over a three year
measurement period;
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ii.
|
stock appreciation rights or stock options, which are subject to
time-based vesting requirements; and/or
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|
iii.
|
restricted stock or restricted stock units, which may be subject
to either time-based
and/or
performance-based vesting requirements; and
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perquisites, retirement benefits, severance and other benefits.
|
Base
Salary
Overview
and Purpose
Base salaries, combined with general welfare benefits, provide
basic security for our employees at levels necessary to attract
and retain a highly qualified and effective salaried workforce.
Base salaries are determined taking into account market data as
well as an individuals position, responsibilities,
experience and value to the Company. The base salaries for the
executive officers are reviewed on an annual basis, as well as
at the time of a promotion or other significant change in
responsibilities. The Chairman and Chief Executive Officer, the
President and Chief Operating Officer, and the Senior Vice
President, Human Resources review performance for the
Companys executive officers, other than the Chief
Executive Officer, and make base salary recommendations to the
Committee. The Committee, in its sole discretion, determines the
salary and amount of increase for the Chairman and Chief
Executive Officer and approves recommended increases for the
entire executive team.
2007
Actions
In 2007 and following the Companys individual performance
evaluation process, the Committee approved base salary increases
for each of Messrs. Stebbins, Donofrio and Kill, ranging
from approximately 3.2% to 4%. These increases were based
primarily on the recommendations of the Chief Executive Officer
based on his assessment of their individual performance and
contribution. Mr. Quigley received two increases in his
base salary during 2007 to $625,000 to recognize his promotions
to Chief Financial Officer and then to Executive Vice President
and the increased responsibility such role entails as well as
his position relative to other executives of the Company. The
Committee also increased the base salary of Mr. Johnston,
the Chairman and Chief Executive Officer, to $1,400,000 as a
component of a revised employment agreement, to recognize
Mr. Johnstons strong individual performance and
contribution, to encourage Mr. Johnston to continue in his
roles through the completion of the Companys three-year
restructuring program, as well as to acknowledge that
Mr. Johnston had not received an increase in his base
salary since 2004. In considering the adjustments to base
salaries, the Committee reviewed tally sheets that
summarized each executives total compensation for the past
three years. The Committee believes that a competitive base
salary is critical to retaining executive talent in a business
which is executing a comprehensive restructuring plan. The
actual salaries paid to each Named Executive Officer for 2007
are presented in the Summary Compensation Table
below.
13
Annual
Incentive Award
Overview
and Purpose
The Companys Annual Incentive program provides for an
annual cash incentive opportunity that is linked to company and
individual performance. This program is designed to compensate
key salaried employees for the achievement of specified goals
that correlate with the Companys financial and operational
objectives. The target incentive opportunities are expressed as
a percentage of base salary. In determining the incentive
opportunities, the Committee considers the potential impact on
the business of each role, the relationships among the roles and
market competitive levels for such positions. In 2007, the
Company continued the incentive structure that was put in place
in 2006.
The program is administered by the Committee pursuant to the
terms of the Visteon Corporation 2004 Incentive Plan, which
has been approved by the Companys stockholders. During the
first quarter of each year, the Committee approves one or more
performance-based metrics, including target and threshold
levels, with the advice and assistance of management. After the
end of the performance period, the Committee reviews actual
performance against each metric and determines the final payout,
if any, based on such performance relative to each metric, which
may be adjusted downward at the discretion of the Committee.
2007
Actions
The Company provides the same award opportunity expressed as a
percentage of base salary to executive officers at comparable
management levels, which were unchanged from 2006. As noted
above, the Company believes that the proportion of variable, or
at risk, compensation, including the annual
incentive opportunity, should increase as an employees
level of responsibility increases.
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Target Annual
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|
Incentive Award
|
|
Executive Level
|
|
Opportunity (% salary)
|
|
|
Chief Executive Officer
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|
130
|
%
|
Chief Operating Officer
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90
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%
|
Executive Vice President
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|
65
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%
|
Senior Vice President
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|
|
60
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%
|
Vice President
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50
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%
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The Committee chose two independent measures for the 2007 Annual
Incentive program applicable to participating employees,
including the Named Executive Officers:
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|
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Free Cash Flow, defined as cash flow from operations less
capital expenditures (assuming a constant level of receivables
sales), which comprised 75% of the opportunity, and
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|
|
Product quality, expressed as parts per million defective
(PPMs), which comprised 25% of the opportunity.
|
The Committee chose these financial and operational metrics to
motivate and reward participating employees achievement of
objectives that are key to the Companys long-term
sustainability goals. Free Cash Flow is monitored by both the
financial community and the Companys customers; product
quality, measured in terms of parts per million defective, is
closely evaluated by current and future customers. The target
PPM, which would result in a full payout for this metric,
required a 50% improvement over 2006 performance. Within their
discretion, the Committee adjusted the Free Cash Flow metric to
exclude the impact of certain facility and business
divestitures. The potential range of incentive award
opportunities and specific target metrics, by Named Executive
Officer, is presented below in the Grants of Plan-Based
Awards in 2007 table.
The Company achieved 109.33% of the Free Cash Flow objective and
77% of the PPM objective resulting in an award payout of 101.25%
of each participants opportunity. The actual 2007 annual
incentive bonuses paid to each Named Executive Officer for 2007
are presented in the Summary Compensation Table
below under the Non-Equity Incentive Plan
Compensation column.
14
To recognize their individual performance, contributions and
leadership during 2007 the Committee made additional
discretionary awards to Messrs. Stebbins, Quigley and
Donofrio. These awards were based on the Chief Executive
Officers assessment and recommendation of their
advancement of the Companys strategic plans as well as
organizational effectiveness. The amounts paid are presented in
the Summary Compensation Table below under the
Bonus column.
Long-Term
Incentive Awards
Overview
and Purpose
The Companys Long-Term Incentive program provides for an
annual award of a performance-based cash bonus earned over a
long-term measurement period, usually a three-year period, stock
appreciation rights and stock options, which are subject to
time-based vesting requirements, and restricted stock or
restricted stock units, which may be subject to either
time-based
and/or
performance-based vesting requirements. This program is designed
to compensate salaried employees on the achievement of specified
goals that are intended to correlate with the Companys
long-term financial and strategic objectives, to align the
delivery of incentive value with increases in the Companys
stock price and to retain key employees. Retention of key
employees has been an important consideration in the delivery of
the Companys long-term incentive opportunity, especially
during the Companys restructuring program. To that end,
the long-term program has incorporated compensation elements
that are time-based, such as restricted stock units and
retention bonuses, to retain key employees. The total targeted
award opportunity, expressed as a percentage or multiple of base
salary is determined by organization level.
2007
Actions
The Company provides the same targeted incentive award
opportunity expressed as a percentage of base salary to
executive officers at the same organizational level, which were
unchanged from 2006. As noted above, the Company believes that
the proportion of variable, or at risk,
compensation, including the long-term incentive opportunity,
should increase as an employees level of responsibility
increases.
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Target Long-Term
|
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|
Incentive Award
|
|
Executive Level
|
|
Opportunity (% salary)
|
|
|
Chief Executive Officer
|
|
|
475
|
%
|
Chief Operating Officer
|
|
|
350
|
%
|
Executive Vice President
|
|
|
250
|
%
|
Senior Vice President
|
|
|
175
|
%
|
Vice President
|
|
|
120
|
%
|
To provide further alignment with the interests of stockholders,
75% of the total
2007-2009
Long-Term Incentive opportunity was delivered through the grant
of stock appreciation rights (SARs), stock options
and restricted stock units, in equal proportions. The SARs vest
ratably over three years and are settled in cash if our stock
price increases over the exercise price at the time of exercise.
The options also vest ratably over three years and are settled
in net shares only if our stock price increases over the
exercise price at the time of exercise. The RSUs vest on
December 31, 2009 and will be settled in cash based on the
fair market value of our stock on such date.
In addition, 12.5% of the total
2007-2009
Long-Term Incentive opportunity was awarded in the form of a
cash bonus based on the achievement of three successive annual
Restructuring metrics. Also, 12.5% of the total
2007-2009
Long-Term Incentive opportunity is awarded in the form of a cash
bonus based on the achievement of three successive annual Grow
the Business metrics. The final bonus amount payable following
the conclusion of the three-year performance period is based
upon the number of annual metrics achieved, with the achievement
of each annual metric representing one-third of the total target
award. For the first year of the
2007-2009
Long-Term Incentive, the Restructuring metric was achieved based
on the accomplishment of restructuring actions at six
underperforming and non-strategic plants
and/or
businesses, and the Grow the Business metric was achieved based
on achieving more than $750 million in incremental new
business wins, each consistent with the Companys business
plan objectives. These metrics were chosen as they are both
vital aspects of the Companys three-year improvement plan.
The Committee has the discretion to modify or adjust the metrics
to take into account the disposition of businesses
and/or
facilities and other factors. The potential range of awards for
the
2007-2009
cycle, by Named Executive Officer, is presented below in the
Grants of Plan-Based Awards in 2007 table.
15
The Company paid cash incentives under the
2005-2007
long-term incentive cycle based on achievement of a product
quality metric JD Power survey results, as well as a
time-based cash element. The JD Power survey improvement goal
targeted 20% improvement over a three year period in problems
per 100 vehicles at three months in service on components and
systems supplied by Visteon to its customers. The time-based
cash award was the last of three annual installments being paid
to eligible employees. This feature was intended to encourage
retention of key leadership employees, without increasing the
total long-term incentive opportunity. Actual payouts are
presented in the Summary Compensation Table, under
the columns Bonus and Non-Equity Incentive
Plan Compensation, and are discussed further below.
Other
Elements of Compensation for Named Executive Officers
In 2007, an additional grant of SARs was made to each Named
Executive Officer as well as certain other executives. These
SARs vest after two years and are settled in cash if our stock
price increases over the exercise price at the time of exercise.
This grant was made to recognize the exceptional performance of
certain individuals during the first year of the three-year
restructuring plan and to provide an additional retention
element to their compensation, in a manner aligned with
shareholder value accretion.
Executive officers participate in the Companys retirement
and savings and health and welfare plans on the same basis as
other similarly situated employees, except for the supplemental
pension, retiree health care, savings and other arrangements
described below under Retirement Benefits. In
addition, executive officers receive a monthly cash car
allowance, annual physical and a flexible perquisite account
that may be used for certain discretionary purposes as well as
other perquisites from time to time approved by the Committee.
The Company provides these benefits to its executives when
necessary to compete for, and retain, executive talent.
The Company maintains an Executive Security Program that
requires the Chief Executive Officer and the Chief Operating
Officer to use corporate provided aircraft for personal and
business travel, and provides the benefit of various personal
health and safety protections.
Severance
and
Change-in-Control
Arrangements
In 2005, the Company adopted the Visteon Executive Severance
Plan (the Severance Plan). The Severance Plan
provides for severance benefits to officers elected by the Board
of Directors and certain senior management employees of the
Company whose employment is subsequently involuntarily
terminated, without cause, subject to certain exceptions. If
eligible under the Companys retirement plans, an executive
may retire concurrent with a severance-eligible termination
under the Severance Plan. The plan was adopted to provide
uniform, market-based severance to executives as the Company
restructured its businesses.
To compete for and attract skilled executives, the Company also
enters into individual employment agreements from time to time
with executives that contain additional or alternative severance
benefits. A description of individual agreements for certain
Named Executive Officers is set forth below.
The Company has entered into
change-in-control
agreements with each of Messrs. Johnston, Stebbins,
Quigley, and Donofrio, as well as other officers. Pursuant to
these agreements, each participant will receive certain benefits
upon the occurrence of specified triggering events following a
change of control of the Company. Such arrangements are
necessary to encourage highly-sought after executives to remain
with the Company during periods leading up to and following a
change of control transaction. The agreements were originally
offered to encourage executives to join the Company at the time
of its spin off from Ford Motor Company in 2000, recognizing the
uncertainty that accompanies a newly independent company. The
Company and the Committee revisit these arrangements from time
to time, including most recently in 2005, to confirm that they
are consistent with market practices.
A further description of post-termination benefits and projected
amounts under various scenarios for Named Executive Officers is
set forth below under Potential Payments Upon Termination
or
Change-in-Control.
16
Stock
Ownership
The Company has adopted stock ownership goals for all elected
officers of the Company. The goal for these officers is to own
common stock worth a multiple of salary, ranging from one times
salary up to five times salary for the Chairman and Chief
Executive Officer, within five years from their date of hire or
election, if later. All of the Named Executive Officers employed
by the Company for five years or more are in compliance with the
stock ownership guidelines.
For the purpose of determining compliance with the stock
ownership guidelines, the calculation includes stock owned
directly, restricted stock, restricted stock units and stock
units held in the Companys Deferred Compensation Plan.
Visteons Stock Ownership guidelines are as follows:
|
|
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|
|
Chief Executive Officer five times base salary;
|
|
|
|
COO through SVP three times base salary; and
|
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|
|
All other officers one times base salary.
|
Tax,
Accounting and Other Considerations
The Committee has considered the Companys ability to
deduct from taxable income certain performance based
compensation under section 162(m) of the Code. For the
Companys top five executives (other than the CFO),
salaries in excess of $1 million and non-performance-based
bonuses, restricted stock or restricted stock units will not be
exempt from section 162(m) of the Code. The Companys
current U.S. tax position does not make tax deductibility
of compensation a determinative factor in the design of its
compensation program.
The stock appreciation rights and restricted stock units of the
2007 long-term incentive awards granted to Named Executive
Officers are accounted for as liability awards with the
Companys ultimate expense equal to the value earned by
employees. The liability classification is due in large part to
the cash settlement feature of the stock appreciation rights and
restricted stock units awarded in 2007. These awards were
structured to limit the use of shares of the Companys
common stock due to low availability levels under the
Companys incentive plans.
The Company does not currently have a specific policy regarding
the adjustment or recovery of awards or payments if the relevant
performance measures upon which they are based are restated or
otherwise adjusted in a manner that reduces the size of such
award or payment. The Committee and the Company are currently
considering whether to adopt a specific policy regarding such
circumstances. Until such policy is adopted, the Committee and
the Company expect to review the specific circumstances of any
such adjustment or restatement to determine whether to request
reimbursement of any award paid to an employee.
17
Summary
Compensation Table
The following table summarizes the compensation that was earned
by, or paid or awarded to, the Named Executive Officers. The
Named Executive Officers are the Companys
Chief Executive Officer, the Companys Chief Financial
Officer as of December 31, 2007 and the three other most
highly compensated executive officers serving as such as of
December 31, 2007, determined based on the
individuals total compensation for the year ended
December 31, 2007 as reported in the table below, other
than amounts reported as above-market earnings on deferred
compensation and the actuarial increase in pension benefit
accruals. The Named Executive Officers also includes a former
executive officer because his total compensation exceeded that
of certain other Named Executive Officers as well as the
Companys former Chief Financial Officer.
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Change
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in Pension
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|
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Value and
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Nonqualified
|
|
|
|
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|
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|
|
|
|
|
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|
|
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Non-Equity
|
|
|
Deferred
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Options
|
|
|
Incentive Plan
|
|
|
Compensation
|
|
|
All Other
|
|
|
|
|
|
|
|
|
|
Salary
|
|
|
Bonus
|
|
|
Stock Awards
|
|
|
Awards
|
|
|
Compensation
|
|
|
Earnings
|
|
|
Compensation
|
|
|
Total
|
|
Name and Principal Position
|
|
Year
|
|
|
($)
|
|
|
($)(1)
|
|
|
($)(2)
|
|
|
($)(3)
|
|
|
($)(4)
|
|
|
($)(5)
|
|
|
($)(6)
|
|
|
($)
|
|
|
Michael F. Johnston
|
|
|
2007
|
|
|
$
|
1,341,667
|
|
|
$
|
641,667
|
|
|
$
|
40,149
|
|
|
$
|
1,147,424
|
|
|
|
$3,856,067
|
|
|
$
|
1,086,985
|
|
|
$
|
279,648
|
|
|
$
|
8,393,607
|
|
Chairman and Chief Executive Officer
|
|
|
2006
|
|
|
$
|
1,050,000
|
|
|
$
|
754,250
|
|
|
$
|
3,258,090
|
|
|
$
|
4,224,892
|
|
|
|
$573,750
|
|
|
$
|
642,969
|
|
|
$
|
279,185
|
|
|
$
|
10,783,136
|
|
William G. Quigley III
|
|
|
2007
|
|
|
$
|
515,833
|
|
|
$
|
123,125
|
|
|
$
|
70,068
|
|
|
$
|
270,646
|
|
|
|
$680,130
|
|
|
$
|
67,916
|
|
|
$
|
38,183
|
|
|
$
|
1,765,901
|
|
Executive Vice President and Chief Financial Officer
|
|
|
2006
|
|
|
$
|
366,667
|
|
|
$
|
83,250
|
|
|
$
|
346,982
|
|
|
$
|
225,505
|
|
|
|
$
|
|
|
$
|
63,119
|
|
|
$
|
26,485
|
|
|
$
|
1,112,008
|
|
Donald J. Stebbins
|
|
|
2007
|
|
|
$
|
919,167
|
|
|
$
|
350,509
|
|
|
$
|
88,866
|
|
|
$
|
662,075
|
|
|
|
$1,716,466
|
|
|
$
|
143,759
|
|
|
$
|
122,110
|
|
|
$
|
4,002,952
|
|
President and Chief Operating Officer
|
|
|
2006
|
|
|
$
|
883,333
|
|
|
$
|
415,663
|
|
|
$
|
1,082,100
|
|
|
$
|
1,534,766
|
|
|
|
$269,167
|
|
|
$
|
|
|
|
$
|
168,140
|
|
|
$
|
4,353,169
|
|
John Donofrio
|
|
|
2007
|
|
|
$
|
487,500
|
|
|
$
|
158,056
|
|
|
$
|
133,532
|
|
|
$
|
292,964
|
|
|
|
$523,891
|
|
|
$
|
35,702
|
|
|
$
|
71,103
|
|
|
$
|
1,702,748
|
|
Senior Vice President and General Counsel
|
|
|
2006
|
|
|
$
|
470,833
|
|
|
$
|
122,972
|
|
|
$
|
922,438
|
|
|
$
|
424,729
|
|
|
|
$
|
|
|
$
|
35,497
|
|
|
$
|
66,979
|
|
|
$
|
2,043,448
|
|
John F. Kill
|
|
|
2007
|
|
|
$
|
412,500
|
|
|
$
|
65,708
|
|
|
$
|
17,452
|
|
|
$
|
102,849
|
|
|
|
$462,055
|
|
|
$
|
126,201
|
|
|
$
|
507,196
|
|
|
$
|
1,693,961
|
|
Former Senior Vice President, Global Marketing, Innovation and
Business Development(7)
|
|
|
2006
|
|
|
$
|
398,083
|
|
|
$
|
212,344
|
|
|
$
|
509,342
|
|
|
$
|
546,713
|
|
|
|
$84,150
|
|
|
$
|
184,281
|
|
|
$
|
41,678
|
|
|
$
|
1,976,591
|
|
James F. Palmer
|
|
|
2007
|
|
|
$
|
149,716
|
|
|
$
|
|
|
|
$
|
(1,960,842
|
)
|
|
$
|
(37,520
|
)
|
|
|
$
|
|
|
$
|
|
|
|
$
|
3,067
|
|
|
$
|
(1,845,579
|
)
|
Former Executive Vice President and Chief Financial Officer(8)
|
|
|
2006
|
|
|
$
|
768,333
|
|
|
$
|
294,500
|
|
|
$
|
1,918,357
|
|
|
$
|
1,093,604
|
|
|
|
$315,000
|
|
|
$
|
134,112
|
|
|
$
|
148,786
|
|
|
$
|
4,672,692
|
|
Joel Coque
|
|
|
2007
|
|
|
$
|
511,105
|
|
|
$
|
51,111
|
|
|
$
|
9,226
|
|
|
$
|
(109,634
|
)
|
|
|
$426,084
|
|
|
$
|
|
|
|
$
|
3,179,082
|
|
|
$
|
4,066,974
|
|
Former Vice President, Interiors Product Group(9)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
For 2007, this column includes
(i) the third of three annual retention bonuses paid
pursuant to the
2005-2007
long-term incentive program to Mr. Johnston ($641,667),
Mr. Quigley ($78,125), Mr. Stebbins ($265,509),
Mr. Donofrio ($68,056), Mr. Kill ($65,708), and
Mr. Coque ($51,111), and (ii) discretionary bonuses to
recognize individual performance and contribution paid to
Mr. Quigley ($45,000), Mr. Stebbins ($85,000) and
Mr. Donofrio ($90,000).
|
|
(2)
|
|
For 2007, these amounts represent
the compensation cost of unvested restricted stock and
restricted stock units granted during 2007 and in prior years
for financial reporting purposes for 2007 under FAS 123(R).
A discussion of assumptions relevant to calculating these values
may be found in Note 7 to our consolidated financial
statements included in our Annual Report on
Form 10-K
for the 2007 fiscal year. There can be no assurance that the
amounts reflected in the table above will ever be realized. The
amount for Mr. Palmer reflects the net result of reversing
a portion of the compensation cost of awards that were
previously expensed by the Company which he forfeited upon his
resignation.
|
|
(3)
|
|
For 2007, these amounts represent
the compensation cost of unvested stock options and vested and
unvested stock appreciation rights granted during 2007 and in
prior years for financial reporting purposes for 2007 under
FAS 123(R). A discussion of assumptions relevant to
calculating these values may be found in Note 7 to our
consolidated financial statements included in our Annual Report
on
Form 10-K
for the 2007 fiscal year. For retirement eligible grantees,
including Messrs. Johnston and Kill, the entire amount
relating to unvested stock appreciation rights granted in 2007
was expensed in such year of grant. There can be no assurance
that the amounts reflected in the table above will ever be
realized. The amount for Mr. Palmer for 2007 reflects the
net result of reversing a portion of the compensation cost of
awards that were previously expensed by the Company which he
forfeited upon his resignation.
|
18
|
|
|
(4)
|
|
For 2007, this column is comprised
of (i) cash bonus payments under the
2005-2007
long-term incentive program to Mr. Johnston ($1,459,150),
Mr. Quigley ($177,656), Mr. Stebbins ($603,768),
Mr. Donofrio ($154,758), Mr. Kill ($149,421) and
Mr. Coque ($116,225), (ii) cash bonus payments under
the 2007 annual incentive program to Mr. Johnston
($1,842,750), Mr. Quigley ($411,328), Mr. Stebbins
($842,906), Mr. Donofrio ($297,675), Mr. Kill
($252,113) and Mr. Coque ($258,748), and (iii) amounts
earned under the cash bonus portion of the
2007-2009
long-term incentive program based on salaries in effect as of
December 31, 2007 by Mr. Johnston ($554,167),
Mr. Quigley ($91,146), Mr. Stebbins ($269,792),
Mr. Donofrio ($71,458), Mr. Kill ($60,521) and
Mr. Coque ($51,111), which will not be paid until 2010
based on salaries in effect as of December 31, 2009 and may
be subject to forfeiture under certain circumstances. See
Grants of Plan-Based Awards in 2007. There were no
earnings on non-equity incentive plan compensation earned or
paid to the Named Executive Officers in or for 2007.
|
|
(5)
|
|
This column reflects an estimate of
the aggregate change in actuarial present value of each Named
Executive Officers accumulated benefit under all defined
benefit and actuarial pension plans from the measurement dates
for such plans used for financial statement purposes. Due to the
measurement date change from September 30 to December 31,
the change in the Pension Value was calculated as
12/15ths
of the 15 month period from September 30, 2006 to
December 31, 2007. Mr. Coque ($115,905) and
Mr. Palmer ($92,557) each experienced an increase in this
value; however, their benefits were forfeited prior to
December 31, 2007. See Retirement
Benefits Defined Benefit Plans, below. None of
the Named Executive Officers received or earned any above-market
or preferential earnings on deferred compensation.
|
|
(6)
|
|
For 2007, this column includes the
following benefits paid to, or on behalf of, the Named Executive
Officers:
|
|
|
|
|
|
matching contributions made by the
Company under the Companys 401(k) plan for each of
Messrs. Johnston, Stebbins, Quigley, Donofrio, Kill and
Palmer;
|
|
|
|
life insurance premiums paid by
the Company on behalf of all of the Named Executive Officers;
|
|
|
|
tax
gross-ups
and reimbursements on behalf of Mr. Johnston ($9,088) and
Mr. Kill ($1,669);
|
|
|
|
severance payments to
Mr. Kill ($415,000) under the Executive Severance Plan, and
Mr. Coque ($3,068,545) under his settlement agreement, as
described further below under Potential Payments Upon
Termination or
Change-in-Control;
and
|
|
|
|
perquisites and other personal
benefits, which included: (A) cash vehicle allowance
payments to Messrs. Johnston, Stebbins, Quigley, Donofrio,
Kill and Palmer; (B) the aggregate incremental cost for
personal use of corporate aircraft by Mr. Johnston
($139,701), Mr. Stebbins ($56,833), Mr. Donofrio
($33,322) and Mr. Kill ($46,398); (C) the cost of
personal health and safety protection equipment and services
under the Executive Security Program in 2007 for
Mr. Johnston ($48,930) and Mr. Stebbins;
(D) payments under the executive flexible perquisite
account program to Mr. Johnston ($60,000),
Mr. Stebbins ($50,000), Mr. Quigley,
Mr. Donofrio, Mr. Kill and Mr. Coque;
(E) leased car payments for Mr. Coque ($47,621);
(F) the reimbursement of vehicle maintenance and insurance
for Mr. Coque; and (G) reimbursement of apartment
lease cost to Mr. Coque ($25,993).
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|
We calculate the aggregate
incremental cost to the Company of any personal use of the
corporate aircraft based on an average hourly operating cost of
the aircraft, which includes the cost of fuel, crew travel
expenses, on-board catering, airport landing fees and parking
costs, customs charges, communications expenses, post-flight
inspections and minor maintenance costs (costs less than $5,000
per action). Because the corporate aircraft are used primarily
for business travel, we do not include the fixed costs that do
not change based on usage, such as the crews salaries, the
purchase or lease costs of the corporate aircraft, hangar rental
fees, insurance premiums and major maintenance costs (costs
greater than or equal to $5,000 per action).
|
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(7)
|
|
Mr. Kill retired from the
Company effective after the close of business on
December 31, 2007.
|
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(8)
|
|
Mr. Palmer resigned as an
executive officer of the Company effective as of March 9,
2007.
|
|
(9)
|
|
Mr. Coque ceased to be an
executive officer of the Company as of July 25, 2007.
Mr. Coques compensation is paid in euros and is
presented in U.S. dollars based on an exchange rate of 1.4603
U.S. dollars per euro, which was the exchange rate in effect on
the last business day of 2007.
|
19
Employment
Arrangements
Agreement with Mr. Johnston. In 2000, the
Company entered into an employment agreement with Michael F.
Johnston that provided terms of his initial employment. On
February 27, 2007, the Company and Mr. Johnston
entered into an amended and restated employment agreement. The
agreement provides that Mr. Johnston will continue to serve
as the Companys Chairman and Chief Executive Officer for
the term of the agreement. The term of the agreement commences
as of March 1, 2007 and continues through December 31,
2008, unless the parties mutually agree to end the term earlier.
The agreement also provides for his 2007 base salary
($1.4 million), with future increases at the discretion of
the Board of Directors, and his participation in the health,
welfare, retirement, incentive and other benefit programs
available to executives, including the flexible perquisite
program. Mr. Johnston will also continue to receive two
years of service credit for every year of credited service under
the Companys pension plans. The Company has also agreed
that Mr. Johnston will be entitled to 66% of his target
cash bonus under the
2007-2009
Long-Term Incentive program and 33% of his target cash bonus
under any
2008-2010
long-term incentive award if he continues his employment through
December 31, 2008 or if his employment is terminated
earlier without cause. Mr. Johnston is also entitled to
stock options, restricted stock and other equity-based awards as
and when such awards are made to other officers generally on at
least the same basis as such awards are made to other officers.
The agreement will terminate upon the death or disability of
Mr. Johnston. The agreement also may be terminated by
Mr. Johnston upon 90 days notice to the Company, or by
the Company for cause. The term cause
means that the executive has been guilty of (i) material,
willful dishonesty, (ii) material, willful misconduct,
(iii) willful and substantial nonperformance of assigned
duties, (iv) indicted for a felony or a misdemeanor
involving moral turpitude, or (v) has otherwise breached
the terms of the agreement. In the event Mr. Johnston
remains employed through December 31, 2008 or is earlier
terminated by the Company without cause, Mr. Johnston will
be entitled to (i) a lump-sum cash payment of $2,500,000,
(ii) immediate and full vesting of all outstanding equity
awards granted to him by the Company, and (iii) accrued and
unpaid salary through the date of termination. In the event that
the parties mutually agree to end the term before
December 31, 2008, Mr. Johnston will be entitled to a
prorated amount of the $2,500,000 severance payment based on his
period of service during the term of the agreement, as well as
the immediate and full vesting of all outstanding equity awards
granted to him by the Company. The agreement also imposes
non-competition and confidentiality obligations on
Mr. Johnston.
Agreement with Mr. Stebbins. The Company
entered into an employment agreement effective as of
May 23, 2005 (the Effective Date), with
Mr. Stebbins that provided for the initial terms of his
employment as President and Chief Operating Officer. The
employment agreement provides for his initial annual base salary
and an initial payment of $3,000,000, which may be refundable on
a pro rata basis if his employment is terminated for
Cause or without Good Reason (each as
defined therein) prior to May 23, 2008. Mr. Stebbins
is also entitled to participate in the Companys annual
incentive performance cash bonus program and the Companys
long-term incentive program, with pro-rata payments for the
2005-2007
performance period. The amounts received by Mr. Stebbins in
2007 relating to this long-term incentive period are set forth
in the Summary Compensation Table.
Mr. Stebbins will be credited with two years of benefit
service for each one year of actual benefit service through the
Supplemental Executive Retirement Plan. In addition, the Company
credited Mr. Stebbins with an opening balance in the
Supplemental Executive Retirement Plan of $1,200,000.
Mr. Stebbins aggregate accrued benefit payable from
all qualified and nonqualified retirement plans upon retirement
from the Company will not be less than the greater of the
actuarial equivalent value of (a) the aggregate benefit
payable to him under the Visteon Pension Plan, the Supplemental
Executive Retirement Plan, and the Pension Parity Plan minus the
$1,200,000 opening balance and interest credits attributable
thereto or (b) the $1,200,000 Supplemental Executive
Retirement Plan opening balance plus interest credits accrued to
the date of retirement. Mr. Stebbins will forfeit the
aforementioned benefits if, prior to his fifth anniversary with
the Company he is terminated by the Company for Cause (other
than due to his death or Disability, which shall
have the meaning set forth in the long term disability benefit
plan of the Company in which Mr. Stebbins participates), or
he terminates employment with the Company for other than Good
Reason.
20
The employment agreement has a term of two years, with the
agreement automatically renewable for successive one-year terms
unless either party gives written notice not less than
90 days prior to expiration that it/he does not wish to
renew. If the Company gives such notice prior to
Mr. Stebbins tenth anniversary with the Company,
Mr. Stebbins shall be entitled to severance benefits upon
termination of employment on the same basis as provided for a
termination without Cause or resignation for
Good Reason during the term of the agreement. If the
Company gives such notice after Mr. Stebbins tenth
anniversary with the Company, Mr. Stebbins shall not be
entitled to such severance. The Executive retains the right to
resign at any time for any reason, just as Company retains the
right to sever the employment relationship at any time, with or
without Cause. However, if Mr. Stebbins is terminated by
the Company without Cause or resigns from the Companys
employ for Good Reason during the term of the employment
agreement, Mr. Stebbins will be entitled to the benefits of
the Executive Severance Plan (provided Mr. Stebbins signs a
release of all claims against the Company and its
representatives).
If the current Chief Executive Officer leaves his position for
any reason and another candidate is selected to fill that
position, Mr. Stebbins may elect to terminate his
employment within three months of such decision or appointment,
and receive the severance benefits for a termination without
Cause or resignation with Good Reason, as well as immediate full
vesting of any outstanding stock options or stock appreciation
rights and restricted stock or restricted stock units.
Agreement with Mr. Coque. A wholly owned
subsidiary of the Company entered into an employment agreement
with Mr. Coque in June of 1999, which provided the initial
terms of his employment as director relating to the interior
systems activities for Europe and Latin America, which was also
subject to the terms of a local collective bargaining agreement.
In July of 2007, the Company, its wholly-owned subsidiary and
Mr. Coque entered into a settlement agreement relating to
the terms of the termination of his employment. The amount of
severance paid to Mr. Coque pursuant to the settlement
agreement is set forth in the All Other Compensation
column of the Summary Compensation Table and is
discussed further below under Potential Payments Upon
Termination or
Change-in-Control.
Perquisites
and Allowance Programs
Visteon provides Named Executive Officers with a flexible
perquisite allowance program. The flexible perquisite allowance
is a fixed amount that is paid to each eligible executive in
quarterly installments and is designed to cover his or her
expenses related to club membership dues, legal and financial
counseling, excess liability insurance premiums, tax
preparation, and airfare for spouse or partner accompanying
employee on business travel, among other items. For Named
Executive Officers, the amount of the allowance varies by
management level, with a range of between $25,000 to $60,000 per
year. The amount paid to the Named Executive Officers in 2007
pursuant to the flexible perquisite allowance program is set
forth in the All Other Compensation column of the
Summary Compensation Table.
Visteon also provides
U.S.-based
Named Executive Officers with a monthly vehicle allowance, which
may be used at the discretion of the executive. For Named
Executive Officers, the amount of the allowance varies by
management level, with a range of between $800 to $1,200 per
month.
21
The following table summarizes all incentive plan awards that
were made to the Named Executive Officers during 2007.
Grants of
Plan-Based Awards in 2007
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All Other
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All Other
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Stock Awards:
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Option Awards:
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Number of
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Number of
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Exercise or
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Estimated Future Payouts
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Shares of
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Securities
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Base Price
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Grant Date Fair
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Under Non-Equity Incentive Plan Awards
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Stock or
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Underlying
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of Option
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Market Price on
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Value of Stock and
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Threshold
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Target
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Maximum
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Units
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Options
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Awards
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Grant Date
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Option Awards
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Name
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Grant Date
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($)
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($)
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($)(1)
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(#)(2)
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(#)(3)
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($ / Sh.)
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($ / Sh.)
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($)(4)
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Michael F. Johnston
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2/26/2007
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(5)
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$
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554,167
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$
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1,662,500
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185,133
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1,000,000
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$
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8.98
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$
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9.05
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$6,562,494
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2/26/2007
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(6)
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$
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250,250
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$
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1,820,000
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William G. Quigley III
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2/26/2007
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(5)
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$
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91,146
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$
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273,438
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75,577
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210,480
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$
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8.98
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$
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9.05
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$1,710,033
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2/26/2007
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(6)
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$
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55,860
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$
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406,250
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Donald J. Stebbins
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2/26/2007
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(5)
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$
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269,792
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$
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809,375
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90,130
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589,308
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$
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8.98
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$
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9.05
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$3,696,977
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2/26/2007
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(6)
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$
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114,469
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$
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832,500
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John Donofrio
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2/26/2007
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(5)
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$
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71,458
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$
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214,375
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23,872
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153,114
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$
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8.98
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$
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9.05
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$964,629
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2/26/2007
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(6)
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$
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40,425
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$
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294,000
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John F. Kill
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2/26/2007
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(5)
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$
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60,521
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$
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181,563
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20,218
|
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117,330
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$
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8.98
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$
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9.05
|
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$756,475
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2/26/2007
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(6)
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$
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34,238
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$
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249,000
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James F. Palmer
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Joel Coque
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2/26/2007
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(5)
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$
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51,111
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$
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153,332
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15,385
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96,454
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$
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8.98
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$
|
9.05
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$610,782
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2/26/2007
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(6)
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$
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35,138
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$
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255,553
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(1)
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The 2004 Incentive Plan limits the
amount payable in respect of performance cash awards to any
Named Executive during any calendar year to $10 million.
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(2)
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Represents restricted stock units
granted under the
2007-2009
long-term incentive program, as further described below, as well
as an additional grant to Mr. Quigley under the 2004
Incentive Plan of 50,000 restricted stock units.
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(3)
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Represents stock options and stock
appreciation rights granted under the
2007-2009
long-term incentive program, as further described below, as well
an additional grant of stock appreciation rights under the 2004
Incentive Plan to Messrs. Johnston, Quigley, Stebbins,
Donofrio, Kill and Coque.
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(4)
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A discussion of assumptions used in
calculating grant date fair values in accordance with
FAS 123(R) may be found in Note 7 to our consolidated
financial statements included in our Annual Report on
Form 10-K
for the 2007 fiscal year. The ultimate value of stock-based
awards, if any, will depend on the future value of the common
stock and the holders investment decisions, neither of
which can be accurately predicted.
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(5)
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Represents the performance-based
cash bonus opportunity under the
2007-2009
long-term incentive program, as further described below. An
estimate of the amounts earned under this program relating to
2007 are set forth in the Non-Equity Incentive Plan
Compensation column of the above Summary
Compensation Table, however, such amount will not be paid
until 2010.
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(6)
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Represents the performance-based
cash bonus opportunity under the 2007 annual incentive program,
as further described below. The amounts actually paid under this
program are set forth in the Non-Equity Incentive Plan
Compensation column of the above Summary
Compensation Table.
|
Visteon Corporation
2004 Incentive Plan
The Visteon Corporation 2004 Incentive Plan permits grants
of stock options, stock appreciation rights, restricted stock,
restricted stock units and other rights relating to our common
stock, as well as performance and time-based cash bonuses. As
discussed in the Compensation Discussion and
Analysis, in 2007, the Company implemented a long-term
incentive program for the
2007-2009
performance period and a 2007 annual incentive program for
eligible employees, including the Named Executive Officers.
22
Awards under the 2007 annual incentive program are based on a
predetermined percentage of an employees base salary and
are comprised of a performance-based cash bonus opportunity. For
participating employees, including the Named Executive Officers,
the amount to be paid relating to this performance cash bonus
opportunity was based on Visteons performance relative to
target PPM and Free Cash Flow metrics for fiscal 2007, with the
Free Cash Flow metric weighted at 75% of the opportunity. The
Company was required to achieve PPM of 36 for fiscal 2007 to
achieve its target payout, and at least 65 for the minimum
payout. The Company was required to achieve Free Cash Flow of
$(29) million for fiscal 2007 to achieve its target payout,
and at least $(330) million for the minimum payout. The
Company achieved approximately 109% of the targeted Free Cash
Flow metric and 77% of the targeted PPM metric, resulting in
payments of 101.25% of the total opportunity under the 2007
annual incentive program. Free Cash Flow is defined as cash flow
from operations less capital expenditures, assuming a constant
level of receivable securitization sales and adjusted for
certain business dispositions and transfers. PPM is defined as
defective parts per million.
Awards under the
2007-2009
long-term incentive program are based on a predetermined
percentage of an employees base salary and are comprised
of several components designed to retain and motivate key
employees and to further align the interests of employees with
Visteons long-term business objectives and the interests
of stockholders. For the Named Executive Officers, seventy-five
percent of their total
2007-2009
long-term incentive award was awarded in the form of stock
options, stock appreciation rights and restricted stock units
and the other quarter of their total program award is awarded in
the form of a performance-based cash bonus opportunity, which
are included in the Grants of Plan-Based Awards in
2007 table above. Half of this performance-based bonus
opportunity is based on the achievement of three successive
annual Restructuring metrics, with the other half based on the
achievement of three successive annual Grow the Business
metrics. The final bonus amount payable following the conclusion
of the three-year performance period is based upon the number of
annual metrics achieved, with the achievement of each annual
metric representing one-third of the total target award. For the
first year of this program, the Restructuring metric was based
on the accomplishment of restructuring actions involving at
least six underperforming and non-strategic plants
and/or
businesses, and the Grow the Business metric was based on at
least $750 million in incremental new business wins. The
Committee has the discretion to modify or adjust the metrics to
take into account the disposition of businesses
and/or
facilities and other factors. Except under certain circumstances
such as retirement or involuntary termination, an executive must
be employed in good standing with the Company at the conclusion
of the three-year performance period to be entitled to a bonus
payment. The Company achieved both of the these metrics for
2007. On February 22, 2008, the Committee approved metrics
for the second year of this program. Namely, the Restructuring
metric will be based on the accomplishment of restructuring
actions at a minimum number of underperforming and non-strategic
plants
and/or
businesses, and the Grow the Business metric will be based on a
minimum level of incremental new business wins.
The stock appreciation rights awarded under the
2007-2009
long-term incentive program vest ratably over three years and
are exercisable solely for a cash payment. The additional stock
appreciation rights awarded in 2007 vest on the second
anniversary of the date of grant and are exercisable solely for
a cash payment. The stock options awarded in 2007 vest ratably
over three years. The exercise prices of the stock options and
stock appreciation rights are the average of the high and low
selling prices of our common stock on the New York Stock
Exchange on the date of grant. Any unexercised stock options or
stock appreciation rights will expire after seven years. If a
holder of a stock option or stock appreciation right retires,
becomes disabled, or dies, his or her stock options
and/or stock
appreciation rights continue to be exercisable up to the normal
expiration date. See Potential Payments Upon Termination
or
Change-in-Control,
below. The stock options and stock appreciation rights are
subject to certain conditions, including not engaging in
competitive activity, and generally cannot be transferred. The
restricted stock units awarded in 2007 will vest on
December 31, 2009 and will be paid in cash based on the
average of the high and low selling prices of our common stock
on the New York Stock Exchange on such vesting date. Holders of
restricted stock units may receive the same cash dividend
equivalents as other stockholders owning common stock. No
dividends were paid in 2007.
23
The following table sets forth information on outstanding stock
option and stock awards held by the Named Executive Officers at
December 31, 2007, including the number of shares
underlying both exercisable and unexercisable portions of each
stock option or stock appreciation right as well as the exercise
price and expiration date of each outstanding option and right.
Outstanding
Equity Awards at 2007 Fiscal Year-End
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Option Awards
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Stock Awards
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Equity
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Equity Incentive
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Equity
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Incentive
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Plan Awards:
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Incentive
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Plan Awards:
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Market or
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Plan Awards:
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Market
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Number of
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Payout Value
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Number of
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Number of
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Number of
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Number of
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Value of
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Unearned
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of Unearned
|
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Securities
|
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Securities
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Securities
|
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Shares or
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Shares or
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Shares,
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Shares,
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Underlying
|
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Underlying
|
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Underlying
|
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Units of
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Units of
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Units or
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Units or
|
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Unexercised
|
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Unexercised
|
|
|
Unexercised
|
|
|
Option
|
|
|
|
|
|
Stock That
|
|
|
Stock That
|
|
|
Other Rights
|
|
|
Other Rights
|
|
|
|
Options
|
|
|
Options
|
|
|
Unearned
|
|
|
Exercise
|
|
|
Option
|
|
|
Have Not
|
|
|
Have Not
|
|
|
That Have Not
|
|
|
That Have
|
|
|
|
(#)
|
|
|
(#)
|
|
|
Options
|
|
|
Price
|
|
|
Expiration
|
|
|
Vested
|
|
|
Vested
|
|
|
Vested
|
|
|
Not Vested
|
|
Name
|
|
Exercisable
|
|
|
Unexercisable
|
|
|
(#)
|
|
|
($)
|
|
|
Date
|
|
|
(#)
|
|
|
($)(1)
|
|
|
(#)
|
|
|
($)
|
|
|
Michael F. Johnston
|
|
|
50,000
|
|
|
|
|
|
|
|
|
|
|
$
|
15.75
|
|
|
|
9/14/2010
|
|
|
|
679,371
|
(5)
|
|
$
|
2,982,439
|
|
|
|
|
|
|
|
|
|
|
|
|
97,657
|
|
|
|
|
|
|
|
|
|
|
$
|
17.46
|
|
|
|
5/08/2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
138,644
|
|
|
|
|
|
|
|
|
|
|
$
|
13.57
|
|
|
|
2/12/2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
316,800
|
|
|
|
|
|
|
|
|
|
|
$
|
6.63
|
|
|
|
2/11/2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
213,500
|
|
|
|
|
|
|
|
|
|
|
$
|
9.90
|
|
|
|
5/11/2009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
437,698
|
|
|
|
218,850
|
(2)
|
|
|
|
|
|
$
|
6.245
|
|
|
|
3/09/2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
100,000
|
|
|
|
|
|
|
|
|
|
|
$
|
10.395
|
|
|
|
9/13/2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
201,759
|
|
|
|
403,520
|
(2)
|
|
|
|
|
|
$
|
4.74
|
|
|
|
2/08/2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
399,831
|
(2)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
399,831
|
(2)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
200,338
|
(3)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
William G. Quigley III
|
|
|
20,000
|
|
|
|
|
|
|
|
|
|
|
$
|
9.805
|
|
|
|
12/29/2009
|
|
|
|
119,913
|
(6)
|
|
$
|
526,418
|
|
|
|
|
|
|
|
|
|
|
|
|
39,790
|
|
|
|
19,896
|
(2)
|
|
|
|
|
|
$
|
6.245
|
|
|
|
3/09/2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17,874
|
|
|
|
35,749
|
(2)
|
|
|
|
|
|
$
|
4.76
|
|
|
|
2/05/2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
55,240
|
(2)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
55,240
|
(2)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
100,000
|
(3)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Donald J. Stebbins
|
|
|
100,136
|
|
|
|
|
|
|
|
|
|
|
$
|
6.26
|
|
|
|
5/22/2010
|
|
|
|
370,937
|
(7)
|
|
$
|
1,628,413
|
|
|
|
|
|
|
|
|
|
|
|
|
221,902
|
|
|
|
110,951
|
(4)
|
|
|
|
|
|
$
|
6.26
|
|
|
|
5/22/2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
125,402
|
|
|
|
250,805
|
(2)
|
|
|
|
|
|
$
|
4.76
|
|
|
|
2/05/2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
194,654
|
(2)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
194,654
|
(2)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
200,000
|
(3)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
John Donofrio
|
|
|
33,333
|
|
|
|
16,667
|
(4)
|
|
|
|
|
|
$
|
6.74
|
|
|
|
6/12/2010
|
|
|
|
97,553
|
(8)
|
|
$
|
428,258
|
|
|
|
|
|
|
|
|
|
|
|
|
56,844
|
|
|
|
28,422
|
(4)
|
|
|
|
|
|
$
|
6.74
|
|
|
|
6/12/2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,464
|
|
|
|
66,928
|
(2)
|
|
|
|
|
|
$
|
4.76
|
|
|
|
2/05/2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
51,557
|
(2)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
51,557
|
(2)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
50,000
|
(3)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
|
Stock Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
Equity Incentive
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Incentive
|
|
|
Plan Awards:
|
|
|
|
|
|
|
|
|
|
Incentive
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plan Awards:
|
|
|
Market or
|
|
|
|
|
|
|
|
|
|
Plan Awards:
|
|
|
|
|
|
|
|
|
|
|
|
Market
|
|
|
Number of
|
|
|
Payout Value
|
|
|
|
Number of
|
|
|
Number of
|
|
|
Number of
|
|
|
|
|
|
|
|
|
Number of
|
|
|
Value of
|
|
|
Unearned
|
|
|
of Unearned
|
|
|
|
Securities
|
|
|
Securities
|
|
|
Securities
|
|
|
|
|
|
|
|
|
Shares or
|
|
|
Shares or
|
|
|
Shares,
|
|
|
Shares,
|
|
|
|
Underlying
|
|
|
Underlying
|
|
|
Underlying
|
|
|
|
|
|
|
|
|
Units of
|
|
|
Units of
|
|
|
Units or
|
|
|
Units or
|
|
|
|
Unexercised
|
|
|
Unexercised
|
|
|
Unexercised
|
|
|
Option
|
|
|
|
|
|
Stock That
|
|
|
Stock That
|
|
|
Other Rights
|
|
|
Other Rights
|
|
|
|
Options
|
|
|
Options
|
|
|
Unearned
|
|
|
Exercise
|
|
|
Option
|
|
|
Have Not
|
|
|
Have Not
|
|
|
That Have Not
|
|
|
That Have
|
|
|
|
(#)
|
|
|
(#)
|
|
|
Options
|
|
|
Price
|
|
|
Expiration
|
|
|
Vested
|
|
|
Vested
|
|
|
Vested
|
|
|
Not Vested
|
|
Name
|
|
Exercisable
|
|
|
Unexercisable
|
|
|
(#)
|
|
|
($)
|
|
|
Date
|
|
|
(#)
|
|
|
($)(1)
|
|
|
(#)
|
|
|
($)
|
|
|
John F. Kill
|
|
|
16,000
|
|
|
|
|
|
|
|
|
|
|
$
|
13.0938
|
|
|
|
6/27/2010
|
|
|
|
85,125
|
(9)
|
|
$
|
373,699
|
|
|
|
|
|
|
|
|
|
|
|
|
11,993
|
|
|
|
|
|
|
|
|
|
|
$
|
17.46
|
|
|
|
5/08/2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
21,831
|
|
|
|
|
|
|
|
|
|
|
$
|
13.57
|
|
|
|
2/12/2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
48,300
|
|
|
|
|
|
|
|
|
|
|
$
|
6.63
|
|
|
|
2/11/2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31,400
|
|
|
|
|
|
|
|
|
|
|
$
|
9.90
|
|
|
|
5/11/2009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
53,282
|
|
|
|
26,641
|
(2)
|
|
|
|
|
|
$
|
6.245
|
|
|
|
3/09/2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
28,180
|
|
|
|
56,361
|
(2)
|
|
|
|
|
|
$
|
4.76
|
|
|
|
2/05/2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
43,665
|
(2)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
43,665
|
(2)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30,000
|
(3)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
James F. Palmer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
Joel Coque
|
|
|
6,500
|
|
|
|
|
|
|
|
|
|
|
$
|
13.0938
|
|
|
|
6/27/2010
|
|
|
|
62,122
|
(10)
|
|
$
|
272,716
|
|
|
|
|
|
|
|
|
|
|
|
|
7,350
|
|
|
|
|
|
|
|
|
|
|
$
|
17.46
|
|
|
|
5/08/2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13,000
|
|
|
|
|
|
|
|
|
|
|
$
|
13.05
|
|
|
|
1/10/2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,223
|
|
|
|
|
|
|
|
|
|
|
$
|
13.57
|
|
|
|
2/12/2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22,116
|
|
|
|
|
|
|
|
|
|
|
$
|
9.90
|
|
|
|
5/11/2009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,600
|
|
|
|
19,601
|
(2)
|
|
|
|
|
|
$
|
6.245
|
|
|
|
3/09/2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,954
|
|
|
|
39,908
|
(2)
|
|
|
|
|
|
$
|
4.76
|
|
|
|
2/05/2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
33,227
|
(2)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
33,227
|
(2)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30,000
|
(3)
|
|
|
|
|
|
$
|
8.98
|
|
|
|
2/25/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
The market value of unvested
restricted stock and restricted stock units was determined using
a per share/unit price of $4.39, the closing price of our common
stock as reported on the New York Stock Exchange as of
December 31, 2007.
|
|
(2)
|
|
Annual awards of stock options
and/or stock appreciation rights granted pursuant to the
Companys long-term incentive programs, which vest ratably
over the first three years following the grant date.
|
|
(3)
|
|
Special award of stock appreciation
rights, which vest on the second anniversary of the date of
grant.
|
|
(4)
|
|
New hire award of stock options,
which vest ratably over the first three years following the
grant date.
|
|
(5)
|
|
231,185 restricted stock units
vested on March 10, 2008; 263,053 restricted stock units
vest on February 9, 2009; and 185,133 restricted stock
units vest on December 31, 2009.
|
|
(6)
|
|
21,017 restricted stock units
vested on March 10, 2008; 23,319 restricted stock units
vest on February 6, 2009; 50,000 restricted stock units
vest on March 1, 2009; and 25,577 restricted stock units
vest on December 31, 2009.
|
|
(7)
|
|
117,205 restricted stock units
vested on March 10, 2008; 163,602 restricted stock units
vest on February 6, 2009; and 90,130 restricted stock units
vest on December 31, 2009.
|
|
(8)
|
|
30,024 restricted stock units
vested on March 10, 2008; 43,657 restricted stock units
vest on February 6, 2009; and 23,872 restricted stock units
vest on December 31, 2009.
|
|
(9)
|
|
28,143 restricted stock units
vested on March 10, 2008; 36,764 restricted stock units
vest on February 6, 2009; and 20,218 restricted stock units
vest on December 31, 2009.
|
|
(10)
|
|
20,705 restricted stock units
vested on March 10, 2008; 26,032 restricted stock units
vest on February 6, 2009; and 15,385 restricted stock units
vest on December 31, 2009.
|
25
The following table sets forth information regarding each
exercise of stock options
and/or stock
appreciation rights and vesting of restricted stock
and/or
restricted stock units during 2007 for each of the Named
Executive Officers on an aggregated basis.
Option
Exercises and Stock Vested in 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
|
Stock Awards
|
|
|
|
Number of Shares
|
|
|
Value Realized
|
|
|
Number of Shares
|
|
|
Value Realized
|
|
|
|
Acquired on Exercise
|
|
|
on Exercise
|
|
|
Acquired on Vesting
|
|
|
on Vesting
|
|
Name
|
|
(#)
|
|
|
($)
|
|
|
(#)(1)
|
|
|
($)(1)
|
|
|
Michael F. Johnston
|
|
|
|
|
|
$
|
|
|
|
|
421,600
|
|
|
$
|
2,753,042
|
|
William G. Quigley III
|
|
|
|
|
|
$
|
|
|
|
|
35,000
|
|
|
$
|
154,725
|
|
Donald J. Stebbins
|
|
|
|
|
|
$
|
|
|
|
|
45,314
|
|
|
$
|
379,278
|
|
John Donofrio
|
|
|
30,000
|
|
|
$
|
130,950
|
|
|
|
85,000
|
|
|
$
|
684,675
|
|
John F. Kill
|
|
|
|
|
|
$
|
|
|
|
|
49,200
|
|
|
$
|
350,329
|
|
James F. Palmer
|
|
|
237,162
|
|
|
$
|
744,889
|
|
|
|
47,600
|
|
|
$
|
398,412
|
|
Joel Coque
|
|
|
37,311
|
|
|
$
|
101,631
|
|
|
|
10,008
|
|
|
$
|
83,767
|
|
|
|
|
(1)
|
|
These values were determined by
using the average of the high and low selling prices of our
common stock on the New York Stock Exchange on such vesting
dates as required by the 2004 Incentive Plan, without regard to
cash or shares withheld for income tax purposes.
|
The following table summarizes information as of
December 31, 2007 relating to Visteons equity
compensation plans pursuant to which grants of stock options,
stock appreciation rights, stock rights, restricted stock,
restricted stock units and other rights to acquire shares of its
common stock may be made from time to time.
Equity
Compensation Plan Information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-
|
|
|
Number of Securities
|
|
|
|
Number of Securities
|
|
|
Average Exercise
|
|
|
Remaining Available for
|
|
|
|
to be Issued Upon
|
|
|
Price of
|
|
|
Future Issuance Under
|
|
|
|
Exercise of
|
|
|
Outstanding
|
|
|
Equity Compensation
|
|
|
|
Outstanding Options,
|
|
|
Options,
|
|
|
Plans (excluding
|
|
|
|
Warrants and Rights
|
|
|
Warrants and
|
|
|
securities reflected in
|
|
Plan Category
|
|
(a)(1)
|
|
|
Rights(b)
|
|
|
column(a)) (c)(2)
|
|
|
Equity compensation plans approved by security holders
|
|
|
12,927,920
|
|
|
$
|
10.80
|
|
|
|
8,971,581
|
|
Equity compensation plans not approved by security holders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
12,927,920
|
|
|
$
|
10.80
|
|
|
|
8,971,581
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Excludes 92,500 unvested shares of
restricted common stock issued pursuant to the
Visteon Corporation 2004 Incentive Plan and/or the
Employees Equity Incentive Plan. Also excludes stock
appreciation rights and restricted stock units issued pursuant
to the Visteon Corporation 2004 Incentive Plan and
Employees Equity Incentive Plan that by their terms may only be
settled in cash.
|
|
(2)
|
|
Excludes an indefinite number of
deferred stock units that may be awarded under the
Visteon Corporation Non-Employee Director Stock Unit Plan,
which units may be settled in cash or shares of our common
stock. Such Plan provides for an annual, automatic grant of
stock units worth $70,000 to each non-employee director of the
Company. There is no maximum number of securities that may be
issued under this Plan; however, the Plan will terminate on
May 12, 2014 unless earlier terminated by the Board of
Directors. This plan was last approved by stockholders on
May 10, 2006.
|
26
Retirement
Benefits
Defined
Benefit Plans
The following table sets forth the actuarial present value of
each Named Executive Officers accumulated benefit under
each defined benefit plan, assuming benefits are paid at normal
retirement age based on current levels of compensation. The
table also shows the number of years of credited service under
each such plan, computed as of the same pension plan measurement
date used in the Companys audited financial statements for
the year ended December 31, 2007. The table also reports
any pension benefits paid to each Named Executive Officer during
the year.
Pension
Benefits for 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
|
|
|
|
|
|
|
|
|
|
|
|
Years of
|
|
|
Present Value of
|
|
|
Payments
|
|
|
|
|
|
Credited
|
|
|
Accumulated
|
|
|
During Last
|
|
|
|
|
|
Service
|
|
|
Benefit
|
|
|
Fiscal Year
|
|
Name
|
|
Plan Name
|
|
(#)
|
|
|
($)(1)
|
|
|
($)
|
|
|
Michael F. Johnston
|
|
Visteon Pension Plan
|
|
|
7.40
|
|
|
$
|
190,416
|
|
|
$
|
|
|
|
|
Pension Parity Plan
|
|
|
7.40
|
|
|
$
|
847,815
|
|
|
$
|
|
|
|
|
Supplemental Executive Retirement Plan
|
|
|
14.80
|
(4)
|
|
$
|
2,534,686
|
|
|
$
|
|
|
|
|
Executive Separation Allowance Plan
|
|
|
14.80
|
(4)
|
|
$
|
2,438,541
|
|
|
$
|
|
|
William G. Quigley III(2)
|
|
Visteon Pension Plan
|
|
|
3.01
|
|
|
$
|
21,185
|
|
|
$
|
|
|
|
|
Pension Parity Plan
|
|
|
3.01
|
|
|
$
|
24,064
|
|
|
$
|
|
|
|
|
Supplemental Executive Retirement Plan
|
|
|
6.01
|
(5)
|
|
$
|
125,865
|
|
|
$
|
|
|
Donald J. Stebbins(2)
|
|
Visteon Pension Plan
|
|
|
2.62
|
|
|
$
|
22,163
|
|
|
$
|
|
|
|
|
Pension Parity Plan
|
|
|
2.62
|
|
|
$
|
68,240
|
|
|
$
|
|
|
|
|
Supplemental Executive Retirement Plan
|
|
|
5.23
|
(5)
|
|
$
|
966,856
|
|
|
$
|
|
|
John Donofrio(2)
|
|
Visteon Pension Plan
|
|
|
2.55
|
|
|
$
|
20,928
|
|
|
$
|
|
|
|
|
Pension Parity Plan
|
|
|
2.55
|
|
|
$
|
19,668
|
|
|
$
|
|
|
|
|
Supplemental Executive Retirement Plan
|
|
|
2.55
|
|
|
$
|
45,767
|
|
|
$
|
|
|
John F. Kill
|
|
Visteon Pension Plan
|
|
|
7.40
|
|
|
$
|
165,975
|
|
|
$
|
|
|
|
|
Pension Parity Plan
|
|
|
7.40
|
|
|
$
|
144,492
|
|
|
$
|
|
|
|
|
Supplemental Executive Retirement Plan
|
|
|
37.50
|
(6)
|
|
$
|
556,309
|
|
|
$
|
|
|
|
|
Executive Separation Allowance Plan
|
|
|
37.50
|
(6)
|
|
$
|
176,552
|
|
|
$
|
|
|
James F. Palmer(3)
|
|
Visteon Pension Plan
|
|
|
N/A
|
|
|
$
|
|
|
|
$
|
|
|
|
|
Pension Parity Plan
|
|
|
N/A
|
|
|
$
|
|
|
|
$
|
|
|
|
|
Supplemental Executive Retirement Plan
|
|
|
N/A
|
|
|
$
|
|
|
|
$
|
|
|
Joel Coque(3)
|
|
Individual Pension Arrangement
|
|
|
N/A
|
|
|
$
|
|
|
|
$
|
|
|
|
|
|
(1)
|
|
The present value of the
accumulated benefits was determined using the discount rate,
mortality assumptions, interest crediting rate and measurement
date (December 31, 2007) used by the Company for
financial reporting purposes. The benefits were assumed to be
payable at normal retirement ages or such earlier ages at which
the executives could commence an unreduced retirement benefit.
For executives eligible for benefits under the Executive
Separation Allowance Plan, it was assumed that they elected to
receive these benefits at age 55 (or their current age if
later) and defer benefits under the Visteon Pension
Plan, Supplemental Executive Retirement Plan and Pension
Parity Plan until their earliest unreduced retirement age.
|
|
(2)
|
|
Messrs. Quigley, Stebbins and
Donofrio were not vested in their accrued benefits under the
Visteon Pension Plan, the Pension Parity Plan and the
Supplemental Executive Retirement Plan as of
December 31, 2007.
|
|
(3)
|
|
Messrs. Palmer and Coque were
not vested in their accrued benefits as of the time of their
employment was terminated.
|
|
(4)
|
|
Mr. Johnston receives two
years of service credit for each year of actual service under
the Supplemental Executive Retirement Plan and Executive
Separation Allowance Plan.
|
|
(5)
|
|
Messrs. Stebbins and Quigley
receive two years of service credit for each year of actual
service under the Supplemental Executive Retirement Plan.
Mr. Quigleys credits apply for the first five years
of his employment.
|
|
(6)
|
|
Mr. Kills Supplemental
Executive Retirement Plan and Executive Separation Allowance
Plan benefits reflect his years of service with Visteon and Ford
Motor Company. The benefits payable under these plans are
reduced by comparable benefits based on his compensation and
credited service while with Ford Motor Company.
|
27
Participants in the domestic auto industry have traditionally
provided their salaried and hourly employees comprehensive
retirement benefits, including pensions and retiree medical
coverage. The Company provides pension benefits to most of its
U.S. salaried retirees pursuant to the Visteon Corporation
Pension Plan (the Qualified Pension Plan), a defined
benefit plan qualified under Section 401(a) of the Internal
Revenue Code (the Code). Visteon also provides
additional pension benefits to its U.S. executives under
the following nonqualified supplemental pension arrangements:
the Supplemental Executive Retirement Plan (SERP);
the Pension Parity Plan (Pension Parity Plan); and
the Executive Separation Allowance Plan (ESAP). In
order to reduce the costs of these benefits to permit the
Company to compete on a global basis, Visteon has made a number
of modifications to its retirement programs over the past
several years. As a result, participation in these plans, and
certain features of the plans, depend on when each executive was
hired by the Company.
In addition to its U.S. plans, several of the
Companys foreign subsidiaries provide pension benefits
around the globe, including the United Kingdom and France. The
provision, structure and level of these benefits are based on
both the market practice in individual countries as well as the
cost of providing benefits. Despite the differences in the level
and structure of the retirement benefits, most of the plans are
related to an employees salary and service. In some
countries, Visteons plans require that participants
contribute to the plan in order to participate.
U.S.
Executives Hired Before January 1, 2002
Messrs. Johnston and Kill
Qualified
Pension Plan
The non-contributory feature of the Qualified Pension Plan
provides a monthly benefit, payable in the form of a life
annuity, equal to a flat rate (fixed dollar rate) times years of
employment prior to July 1, 2006. The highest flat rate in
effect on June 30, 2006 was $47.45. Prior to July 1,
2006, following three months of employment, a participant could
elect to be covered by the contributory feature of the plan and
receive a contributory benefit in lieu of the non-contributory
benefit. The contributory benefit, payable in the form of a life
annuity, is equal to 1.5% of Final Average Monthly Salary times
years of employment while a contributory participant plus 0.4%
of Final Average Monthly Salary in excess of the Social Security
Breakpoint times years of employment (not to exceed
35 years) while a contributory participant. Final Average
Monthly Salary is the highest average monthly salary paid as of
any five consecutive December 31 dates during the last 120
consecutive months that an employee contributes. The Social
Security Breakpoint is equal to 150% of the average of the
Social Security Wage Base for the last 35 years including
the current plan year. Normal retirement is age 65 and
portions of early retirement benefits are available at
age 62 unreduced for age. Early retirement benefits are
available as early as age 55 with 10 years of service
or at any age with 30 years of service. If the employee was
contributing to the plan as of June 30, 2006, future
December 31 base pay amounts will continue to be recognized for
purposes of determining the Final Average Monthly Salary under
the traditional structure. Effective July 1, 2006, salaried
employees will accrue monthly cash balance benefits under the
pension plan. The Cash Balance benefit is based on a
hypothetical account which grows with 4% pay credits and
interest credits based on the
30-year
Treasury bond rate. The monthly benefit payable from the cash
balance feature is reduced for early commencement if payment
begins before age 65.
Nonqualified
Pension Plans
Since the Qualified Pension Plan is a qualified plan, it is
subject to the rules of the Code. The Code limits the amount of
benefits that may be paid by a qualified plan and it limits the
amount of salary that may be recognized in computing plan
benefits. For 2007, the maximum benefit accrual is $180,000 and
the maximum annual salary the plan may recognize is $225,000.
The Pension Parity Plan, an unfunded, nonqualified pension plan,
restores any benefits lost due to the limitations on benefits
and compensation imposed by the Code. The changes to the
Qualified Pension Plan that took effect on July 1, 2006
also apply to the Pension Parity Plan.
28
For eligible executives hired prior to January 1, 2002, the
SERP, a nonqualified, unfunded pension benefit, provides an
additional monthly benefit, calculated in the form of a life
annuity, equal to the participants Final Average Monthly
Salary (without regard to the Code compensation limit) times
years of employment times a percentage determined by job
classification at retirement. The percentages range between
0.20% and 0.90%. Credited service earned under the SERP will
cease to accrue as of June 30, 2006. Effective July 1,
2006, eligible executives will accrue SERP benefits under a
formula used for eligible executives hired on or after
January 1, 2002, as described below. Mr. Johnston will
receive additional retirement benefits from the SERP determined
by crediting an additional year of service for each year of
service credited under the terms of the Qualified Pension Plan.
Mr. Johnston is currently eligible to retire under the SERP.
The Company also maintains the ESAP, a nonqualified, unfunded
plan, for which four executives may become eligible. The ESAP
was closed to new participants in 2004. The plan is coordinated
with the traditional retirement benefit formula and has
facilitated executive succession through enhanced early
retirement benefits for eligible executives hired prior to
January 1, 2002 (and promoted to the level of an eligible
executive on or prior to June 30, 2004) who retire
after age 55. The ESAP provides a temporary monthly
benefit, payable to age 65, equal to the participants
highest base salary times a percentage, not to exceed 60%, equal
to the sum of i) 15%, ii) 6% for each year that such
participants age at separation exceeds 55 (not to exceed
30%), and iii) 1% for each year of service in excess of 15.
This amount is offset by any payments paid or payable from any
other private retirement plan of the Company other than the SERP.
In December of 2006, the Pension Parity Plan, SERP and ESAP were
amended to provide for automatic payment in the form of a single
lump sum distribution for benefits commencing on and after
January 1, 2007.
U.S.
Executives Hired on or After January 1, 2002
Messrs. Quigley, Stebbins, Donofrio and
Palmer
Qualified
Pension Plan
Salaried employees hired on or after January 1, 2002
participate in the BalancePlus Program, a feature of the
Qualified Pension Plan. The monthly benefit payable from the
BalancePlus Program is based on the greater of the Cash Balance
benefit or the Pension Equity benefit attributable to service
prior to July 1, 2006, and a Cash Balance benefit for
service thereafter. The Cash Balance benefit is based on a
hypothetical account which grows with 4% pay credits and
interest credits based on the
30-year
Treasury bond rate. The Pension Equity benefit is based on a
hypothetical account at age 65 equal to 12.5% of Final
Average Monthly Salary times credited service. Credited service
earned under the Pension Equity feature of the plan ceased to
accrue as of June 30, 2006, although changes in base pay
will continue to be recognized for purposes of determining the
Final Average Monthly Salary. The monthly benefit payable from
the BalancePlus Program is reduced for early commencement if
payment begins before age 65.
Nonqualified
Pension Plans
The Pension Parity Plan restores any benefits lost due to the
limitations on benefits and compensation imposed by the Code, as
described further above.
29
Eligible executives hired on or after January 1, 2002
participate in the BalancePlus SERP feature of the
SERP. The BalancePlus SERP provides an additional monthly
benefit based upon a hypothetical account balance that is in
excess of the amount calculated under the Qualified Pension Plan
BalancePlus Program and the Pension Parity Plan. The account
balance from the BalancePlus SERP before offset is calculated
under the formulas in the BalancePlus Program with the following
modifications: 1) Annual Salary is calculated without
regard to the Code compensation limit; 2) Final Average
Monthly Salary is increased by the average of the three highest
consecutive Annual Incentive amounts; and 3) a 15% benefit
multiplier is used under the Pension Equity formula in lieu of
the 12.5% benefit multiplier. The Pension Equity account under
the BalancePlus SERP has its own early retirement reduction
factors, which are applied at early retirement before offsetting
the amount calculated under the BalancePlus Program and the
Pension Parity Plan. Unlike the Qualified and Pension Parity
Plans, the service under the Pension Equity formula was not
frozen. Messrs. Stebbins and Quigley will receive
additional retirement benefits from the SERP determined by
crediting an additional year of service for each year of service
credited under the terms of the Qualified Pension Plan. In
addition, a $1,200,000 opening balance was credited to
Mr. Stebbins BalancePlus SERP account.
As stated above, the Pension Parity Plan, SERP and ESAP were
amended to provide for automatic payment in the form of a single
lump sum distribution for benefits commencing on and after
January 1, 2007
Individual
Pension Arrangement Mr. Coque
Visteon Systèmes Intérieurs, an indirect wholly owned
subsidiary of the Company, has granted Mr. Coque a pension
benefit upon his retirement at age 60, disability or death
in service. The amount of the pension benefit is equal to 1.5%
of his Final Average Earnings multiplied by his years of service
after July 1, 1999. This benefit is then converted to a
lump sum payment using a fixed factor of 15. The Final Average
Earnings are defined as the average base salary in the
3 years prior to retirement.
Executive
Retiree Health Care Plan
The Company will provide an executive retiree health care
benefit upon retirement from the Company for designated
executives. Pursuant to the program, such executives, after
completing 5 years of service with the Company will be
entitled to retiree health care benefits that are similar to
those available to the Companys employees who are eligible
for post-retirement benefits under the Visteon
Health & Welfare Plan. Of the Named Executive
Officers, Messrs. Johnston and Stebbins are eligible for
this program.
Defined
Contribution and Deferred Compensation Plans
The following table sets forth annual executive and company
contributions under non-qualified defined contribution and other
deferred compensation plans, as well as each Named Executive
Officers withdrawals, earnings and fiscal-year end
balances in those plans:
Nonqualified
Deferred Compensation for 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive
|
|
|
Registrant
|
|
|
Aggregate
|
|
|
Aggregate
|
|
|
Aggregate
|
|
|
|
Contributions in
|
|
|
Contributions in
|
|
|
Earnings
|
|
|
Withdrawals/
|
|
|
Balance
|
|
|
|
Last FY
|
|
|
Last FY
|
|
|
in Last FY
|
|
|
Distributions
|
|
|
at Last FYE
|
|
Name
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
Michael F. Johnston
|
|
|
|
|
|
|
|
|
|
$
|
8,603
|
|
|
|
|
|
|
$
|
363,156
|
|
William G. Quigley III
|
|
|
|
|
|
|
|
|
|
$
|
|
|
|
|
|
|
|
$
|
|
|
Donald J. Stebbins
|
|
|
|
|
|
|
|
|
|
$
|
|
|
|
|
|
|
|
$
|
|
|
John Donofrio
|
|
|
|
|
|
|
|
|
|
$
|
|
|
|
|
|
|
|
$
|
|
|
John F. Kill
|
|
|
|
|
|
|
|
|
|
$
|
|
|
|
|
|
|
|
$
|
|
|
James F. Palmer
|
|
|
|
|
|
|
|
|
|
$
|
|
|
|
|
|
|
|
$
|
|
|
Joel Coque
|
|
|
|
|
|
|
|
|
|
$
|
|
|
|
|
|
|
|
$
|
|
|
30
Prior to June 2005, U.S. based executive officers were
eligible to defer up to 50% of their base salary and up to 100%
of bonuses under the Visteon Deferred Compensation Plan. In June
2005, the plan was closed to further deferrals. The investment
options in that plan generally mirror the options available
under the Visteon Investment Plan, described below, with the
addition of a Visteon stock fund. There are no limits on the
number of investment elections a participant may make. Amounts
deferred into the Visteon stock fund of the plan were allocated
based on the price of the Companys common stock at the
time of deferral, and the value of this account is directly
related to the performance of the Companys common stock.
Amounts deferred under the plan are generally payable in a year
specified by the employee at the time of deferral or, if
earlier, on or after the first day of the seventh month
following termination of employment.
The Named Executive Officers, as well as most U.S. salaried
employees, are also entitled to participate in the Visteon
Investment Plan, Visteons 401(k) investment and savings
plan. The Company matches employee contributions of up to 6% of
pay at a rate of 25% of the employees eligible
contributions. Amounts deferred and matched in 2007 for each
Named Executive Officer are reflected in the Salary
and All Other Compensation columns, respectively, of
the above Summary Compensation Table. The amounts
that may be deferred are limited by the Code.
Potential
Payments Upon Termination or
Change-in-Control
Set forth below are estimated payments and benefits that would
be provided to the Named Executive Officers upon their
termination of employment under specified circumstances assuming
that the relevant triggering event occurred at December 31,
2007. These disclosed amounts are estimates only and do not
necessarily reflect the actual amounts that would be paid to the
Named Executive Officers, which would only be known at the time
that they become eligible for payment and would only be payable
if any of the triggering events were to occur.
Accrued amounts (other than the accelerated vesting of
retirement benefits noted below) under the Companys
pension and deferred compensation plans are not included in this
table. For these amounts, see the Pension Benefits for
2007 table and the Nonqualified Deferred
Compensation for 2007 table above. Vested stock options
and stock appreciation rights are also excluded from this table.
For these amounts, see the Outstanding Equity Awards at
2007 Fiscal Year-End table above.
31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Involuntary
|
|
|
|
|
|
|
|
|
|
Termination
|
|
|
|
|
|
Qualifying
|
|
|
|
(w/o Cause
|
|
|
|
|
|
Termination
|
|
|
|
or for
|
|
|
Change in
|
|
|
after Change in
|
|
Named Executive Officer(1)
|
|
Good Reason)
|
|
|
Control
|
|
|
Control
|
|
|
Michael F. Johnston
|
|
|
|
|
|
|
|
|
|
|
|
|
Benefit:
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Payments
|
|
$
|
2,500,000
|
|
|
|
N/A
|
|
|
$
|
9,660,000
|
|
Accelerated Bonus
|
|
$
|
0
|
|
|
$
|
2,217,000
|
|
|
$
|
2,217,000
|
|
Accelerated Stock Option/SAR Vesting
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
Accelerated Restricted Stock/RSU Vesting
|
|
$
|
2,982,000
|
|
|
$
|
2,982,000
|
|
|
$
|
2,982,000
|
|
Continuation of Perquisites and
Allowances
|
|
$
|
0
|
|
|
|
N/A
|
|
|
$
|
7,000
|
|
Accelerated Retirement Benefits Vesting
|
|
|
N/A
|
|
|
|
N/A
|
|
|
$
|
0
|
|
Continuation of Health &
Welfare Benefits(2)
|
|
$
|
8,000
|
|
|
|
N/A
|
|
|
$
|
49,000
|
|
Outplacement Services(3)
|
|
$
|
7,500
|
|
|
|
N/A
|
|
|
$
|
805,000
|
|
Tax
Gross-Up(4)
|
|
|
N/A
|
|
|
|
N/A
|
|
|
$
|
5,591,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals
|
|
$
|
5,497,500
|
|
|
$
|
5,199,000
|
|
|
$
|
21,311,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Donald J. Stebbins
|
|
|
|
|
|
|
|
|
|
|
|
|
Benefit:
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Payments
|
|
$
|
925,000
|
|
|
|
N/A
|
|
|
$
|
5,273,000
|
|
Accelerated Bonus
|
|
$
|
0
|
|
|
$
|
1,308,000
|
|
|
$
|
1,308,000
|
|
Accelerated Stock Option/SAR Vesting
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
Accelerated Restricted Stock/RSU Vesting
|
|
$
|
0
|
|
|
$
|
1,628,000
|
|
|
$
|
1,628,000
|
|
Continuation of Perquisites and
Allowances
|
|
$
|
0
|
|
|
|
N/A
|
|
|
$
|
5,000
|
|
Accelerated Retirement Benefits Vesting
|
|
|
N/A
|
|
|
$
|
1,153,000
|
|
|
$
|
1,153,000
|
|
Continuation of Health &
Welfare Benefits(2)
|
|
$
|
16,000
|
|
|
|
N/A
|
|
|
$
|
51,000
|
|
Outplacement Services(3)
|
|
$
|
7,500
|
|
|
|
N/A
|
|
|
$
|
439,000
|
|
Tax
Gross-Up(4)
|
|
|
N/A
|
|
|
|
N/A
|
|
|
$
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals
|
|
$
|
948,500
|
|
|
$
|
4,090,000
|
|
|
$
|
9,857,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
William G. Quigley III
|
|
|
|
|
|
|
|
|
|
|
|
|
Benefit:
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Payments
|
|
$
|
625,000
|
|
|
|
N/A
|
|
|
$
|
3,094,000
|
|
Accelerated Bonus
|
|
$
|
0
|
|
|
$
|
225,000
|
|
|
$
|
225,000
|
|
Accelerated Stock Option/SAR Vesting
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
Accelerated Restricted Stock/RSU Vesting
|
|
$
|
0
|
|
|
$
|
526,000
|
|
|
$
|
526,000
|
|
Continuation of Perquisites and
Allowances
|
|
$
|
0
|
|
|
|
N/A
|
|
|
$
|
5,000
|
|
Accelerated Retirement Benefits Vesting
|
|
|
N/A
|
|
|
$
|
187,000
|
|
|
$
|
187,000
|
|
Continuation of Health &
Welfare Benefits(2)
|
|
$
|
16,000
|
|
|
|
N/A
|
|
|
$
|
50,000
|
|
Outplacement Services(3)
|
|
$
|
7,500
|
|
|
|
N/A
|
|
|
$
|
258,000
|
|
Tax
Gross-Up(4)
|
|
|
N/A
|
|
|
|
N/A
|
|
|
$
|
1,561,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals
|
|
$
|
648,500
|
|
|
$
|
938,000
|
|
|
$
|
5,906,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
32
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Involuntary
|
|
|
|
|
|
|
|
|
|
Termination
|
|
|
|
|
|
Qualifying
|
|
|
|
(w/o Cause
|
|
|
|
|
|
Termination
|
|
|
|
or for
|
|
|
Change in
|
|
|
after Change in
|
|
Named Executive Officer(1)
|
|
Good Reason)
|
|
|
Control
|
|
|
Control
|
|
|
John Donofrio
|
|
|
|
|
|
|
|
|
|
|
|
|
Benefit:
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Payments
|
|
$
|
490,000
|
|
|
|
N/A
|
|
|
$
|
2,352,000
|
|
Accelerated Bonus
|
|
$
|
0
|
|
|
$
|
349,000
|
|
|
$
|
349,000
|
|
Accelerated Stock Option/SAR Vesting
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
Accelerated Restricted Stock/RSU Vesting
|
|
$
|
0
|
|
|
$
|
428,000
|
|
|
$
|
428,000
|
|
Continuation of Perquisites and
Allowances
|
|
$
|
0
|
|
|
|
N/A
|
|
|
$
|
5,000
|
|
Accelerated Retirement Benefits Vesting
|
|
|
N/A
|
|
|
$
|
80,000
|
|
|
$
|
80,000
|
|
Continuation of Health &
Welfare Benefits(2)
|
|
$
|
16,000
|
|
|
|
N/A
|
|
|
$
|
48,000
|
|
Outplacement Services(3)
|
|
$
|
7,500
|
|
|
|
N/A
|
|
|
$
|
196,000
|
|
Tax
Gross-Up(4)
|
|
|
N/A
|
|
|
|
N/A
|
|
|
$
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals
|
|
$
|
513,500
|
|
|
$
|
857,000
|
|
|
$
|
3,458,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Mr. Coque is not included in
the above table because his service as an executive officer
terminated as of July 25, 2007 in accordance with a
settlement agreement, as described below. Mr. Kill is not
included in the above table because he retired effective after
the close of business on December 31, 2007, which was
treated as an involuntary termination under the Executive
Severance Plan. Mr. Palmer also is not included in the
above table because he resigned from the Company in March of
2007.
|
|
(2)
|
|
The estimated cost of continuing
health and welfare benefits is based on current insurance
premiums.
|
|
(3)
|
|
The amount of reimbursed services
was assumed to be the maximum amount allowable under the change
in control agreements, described further below. The amounts to
be reimbursed will be only for those expenses actually incurred
by the executive, and may be significantly less than the amount
presented in the table.
|
|
(4)
|
|
For purposes of calculating the
amount of the
gross-up, no
value was ascribed to the restrictive covenants imposed on
executives under the change in control agreement, described
further below, which may reduce the amount actually paid.
Further, it was assumed that outstanding stock options held by
the executives were converted into stock options of the
surviving or acquiring company.
|
Involuntary
Termination (Without Cause or for Good
Reason)
Upon the involuntary termination of employment by the Company
(other than for specified reasons, including disability,
availability of other severance benefits, and inappropriate
conduct), all officers elected by the Board of Directors and
executive leaders are entitled to severance benefits under the
Executive Severance Plan. These severance benefits include a
cash payment equal to one year of base salary, the reimbursement
of medical coverage premiums under COBRA for one year following
termination, the payment of the remaining value of his or her
flexible perquisites account, and the provision of outplacement
services for up to six months. However, if the eligible
executive does not execute an acceptable release and waiver of
claims, such executive will only be entitled to a cash payment
equal to four weeks of base salary. The severance plan permits
executives to receive both the severance benefits under the plan
and, if eligible, the retirement benefits described above.
Neither the Executive Severance Plan nor the 2004 Incentive Plan
accelerates any of the outstanding awards held by executives who
are involuntarily terminated. However, pursuant to the terms and
conditions applicable to awards under the 2004 Incentive Plan,
all employees holding such awards are entitled to the following
benefits in the event of an involuntary termination under a
severance plan or program of the Company, including the
Executive Severance Plan:
|
|
|
|
|
Outstanding restricted stock and restricted stock unit awards
granted more than 180 days prior to date of termination are
prorated based on the number of full months that have elapsed
from the date of grant to the date of termination compared to
the total number of months from the date of grant until the
vesting date, with no change to the vesting date or performance
conditions, if any;
|
33
|
|
|
|
|
Vested stock options and stock appreciation rights granted more
than 180 days prior to date of termination continue to be
exercisable for up to one year following termination and all
unvested stock options and stock appreciation rights not yet
vested are forfeited; and
|
|
|
|
Outstanding performance-based cash awards made more than
180 days prior to date of termination are prorated from the
beginning of the performance period to the date of termination
compared to the total number of months in the original
performance period, with no change to the vesting date or
performance conditions, if any.
|
Mr. Stebbins employment agreement provides that he is
entitled to the benefits of the Executive Severance Plan if his
employment is terminated by the Company without
cause or he resigns for good reason
prior to May 21, 2015. Further, if the incumbent
Chairman and Chief Executive Officer vacates such position on or
after May 21, 2007 and another candidate other than
Mr. Stebbins is selected to such position, then
Mr. Stebbins may terminate his employment within three
months and receives the benefits under the Executive Severance
Plan as well as the immediate and full vesting of all his
outstanding stock options, stock appreciation rights, restricted
stock and restricted stock units, if any. See Employment
Arrangements, above.
Mr. Johnston is entitled to additional severance benefits
under his amended and restated employment agreement. In the
event that Mr. Johnston is terminated by the Company
without cause prior to December 31, 2008, he
will be entitled to (i) a lump-sum cash payment of
$2,500,000, (ii) immediate and full vesting of all
outstanding equity awards granted to him by the Company, and
(iii) accrued and unpaid salary through the date of
termination. In the event that the Company and Mr. Johnston
mutually agree to terminate his employment prior to
December 31, 2008, Mr. Johnston will be entitled to a
prorated amount of the $2,500,000 severance payment based on his
period of service during the term of the agreement, as well as
the immediate and full vesting of all outstanding equity awards
granted to him by the Company. The Company has also agreed that
Mr. Johnston will be entitled to 66% of his target cash
bonus under the
2007-2009
Long-Term Incentive and 33% of his target cash bonus under any
2008-2010
long-term
incentive award if his employment is terminated without cause
prior to December 31, 2008. See Employment
Arrangements, above.
On July 24, 2007, the Company notified Mr. Coque of
the Companys decision to terminate his employment and
related agreements. As a result of a disagreement over the terms
of Mr. Coques termination, and his stated intention
to seek additional remedies before a French labor court, the
Company and Mr. Coque entered into a settlement agreement.
The settlement agreement provides, among other things, for the
payment by the Company of approximately $3 million in
exchange for Mr. Coques release of any claims against
the Company relating to his termination, including benefits
under applicable pension arrangements. In addition, the Company
agreed to treat outstanding equity-based and other awards under
the Companys 2004 Incentive Plan in accordance with a
separation under the Companys Executive Severance Plan.
Change
in Control
The 2004 Incentive Plan provides for accelerated vesting or
payout of equity and incentive awards upon a change in control,
even if the executive does not terminate employment. The
benefits include:
|
|
|
|
|
any awards under the plan that relate to performance periods
that have been completed as of the date of the change in
control, but that have not yet been paid, are paid in accordance
with the terms of such awards;
|
|
|
|
any awards under the plan that relate to performance periods
that have not been completed as of the date of the change in
control, and that are not then vested, become fully vested if
vesting is based solely upon the length of the employment
relationship as opposed to the satisfaction of one or more
performance goals; and
|
|
|
|
any other awards that relate to performance periods that have
not been completed as of the date of the change in control, and
that are not then vested, will be treated as vested and earned
pro rata, as if the performance goals at target levels are
attained as of the effective date of the change in control
(based on the number of full months that have elapsed from the
beginning of the performance period to the date of the change in
control compared to the total number of months in the original
performance period).
|
34
The accelerated vesting applies to all awards made under the
2004 Incentive Plan for all participating employees and is
designed to retain and motivate employees during the uncertain
process that precedes a change in control transaction. Under the
2004 Incentive Plan, a change in control will be
deemed to have occurred as of the first day any one or more of
the following is satisfied:
|
|
|
|
(A)
|
any person is or becomes the beneficial owner, directly or
indirectly, of securities of the Company (not including in the
securities beneficially owned by such person any securities
acquired directly from the Company or its affiliates)
representing 40% or more of the combined voting power of the
Companys then outstanding securities;
|
|
|
(B)
|
within any twelve (12) month period, the following
individuals cease for any reason to constitute a majority of the
number of directors then serving: individuals who, on the
effective date of the 2004 Incentive Plan, constitute the Board
of Directors of the Company and any new director (other than a
director whose initial assumption of office is in connection
with an actual or threatened election contest, including but not
limited to a consent solicitation, relating to the election of
directors of the Company) whose appointment or election by the
Board or nomination for election by the Companys
stockholders was approved or recommended by a vote of at least
two-thirds (2/3) of the directors then still in office who
either were directors on the date hereof or whose appointment,
election or nomination for election was previously so approved
or recommended;
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(C)
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there is consummated a merger or consolidation of the Company or
any direct or indirect subsidiary of the Company with any other
corporation, other than (i) a merger or consolidation which
results in the directors of the Company immediately prior to
such merger or consolidation continuing to constitute at least a
majority of the board of directors of the Company, the surviving
entity or any parent thereof or (ii) a merger or
consolidation effected to implement a recapitalization of the
Company (or similar transaction) in which no person is or
becomes the beneficial owner, directly or indirectly, of
securities of the Company (not including in the securities
beneficially owned by such person any securities acquired
directly from the Company or its affiliates) representing 40% or
more of the combined voting power of the Companys then
outstanding securities;
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(D)
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the stockholders of the Company approve a plan of complete
liquidation or dissolution of the Company or there is
consummated an agreement for the sale or disposition by the
Company of more than 50% of the Companys assets, other
than a sale or disposition by the Company of more than 50% of
the Companys assets to an entity, at least 50% of the
combined voting power of the voting securities of which are
owned by stockholders of the Company in substantially the same
proportions as their ownership of the Company immediately prior
to such sale; or
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(E)
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any other event that the Board, in its sole discretion,
determines to be a change in control.
|
However, a Change in Control will not be deemed to
have occurred by virtue of the consummation of any transaction
or series of integrated transactions immediately following which
the record holders of the common stock of the Company
immediately prior to such transaction or series of transactions
continue to have substantially the same proportionate ownership
in an entity which owns all or substantially all of the assets
of the Company immediately following such transaction or series
of transactions.
Change
in Control followed by Qualifying Termination
The Company has entered into change in control agreements with
all of its executives, including the Named Executive Officers.
These agreements provide for certain benefits if a qualifying
termination occurs following a change in control of the Company.
For the Named Executive Officers, a qualifying termination
includes a termination of the executives employment
without cause or a resignation for good reason, in each case,
within three years after the change in control, as well as a
resignation, with or without good reason, during the
30-day
period at the end of the first year after a change in control.
35
In addition to the benefits described above under Change
in Control, the Named Executive Officers are entitled to
the following benefits pursuant to the change in control
agreements:
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the payment of any unpaid salary or incentive compensation,
together with all other compensation and benefits payable to the
executive under the terms of the Companys compensation and
benefits plans, earned through the date of termination;
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a severance payment in the amount of three times base salary
plus the executives target annual bonus;
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all unvested options and time-based restricted stock, or similar
grants, will vest and become immediately exercisable,
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all contingent incentive compensation awards under the 2004
Incentive Plan (or other plans) for periods that have not been
completed become payable immediately on a pro-rated basis
assuming the achievement at target levels of any individual or
corporate performance goals;
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reimbursement for the cost of outplacement services for up to
three years following termination, not to exceed 25% of the
executives annual base salary plus his or her target annul bonus;
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the aggregate account balances of the executive under the
Deferred Compensation Plan and any other nonqualified account
balance plan will be distributed as a lump sum payout;
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the benefits then accrued by or payable to the executive under
the SERP, ESAP, the Pension Parity Plan, or any other
nonqualified plan providing supplemental retirement or deferred
compensation benefits, become fully vested; and
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the continuation for 36 months following termination of
life, accident and health insurance benefits for the executive
and his or her dependents.
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Change in control payments for the Named Executive Officers will
be grossed up for the payment, if any, of additional
section 280(G) excise taxes.
Good Reason under the agreements includes the
following:
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a negative material change is made in the executives
duties and responsibilities;
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the executives compensation or benefits are decreased and
such decrease is unrelated to company performance;
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the executive is required to materially relocate his or her
residence or principal office location against his or her
will; or
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the executive is not offered a comparable position with the
successor entity.
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The definition of change of control under the change
in control agreements is substantially the same as described
above under Change in Control. The Company is also
required to fund an irrevocable rabbi trust to
satisfy each participants SERP, Pension Parity and ESAP
benefits. Each executive agrees to comply with confidentiality
and non-competition covenants during the term of the agreement
and for a period thereafter. In addition, in the event of a
potential change of control, as defined therein, each executive
agrees not to voluntarily terminate his or her employment,
except for retirement or good reason, until the earlier of six
months after such potential change of control or the occurrence
of a change in control.
Voluntary
Termination (Without Good Reason or for
Cause)
An executive who voluntarily resigns without good reason or
whose employment is terminated by the Company for cause (each as
defined in the Executive Severance Plan, Change in Control
Agreements and the individual employment agreements applicable
to each of Messrs. Johnston and Stebbins) will be entitled
to receive unpaid salary and benefits, if any, he has accrued
through the effective date of his termination.
36
If an executive is terminated for cause, he will immediately
forfeit all restricted stock, restricted stock units, stock
options, stock appreciation rights and performance cash awards
under the 2004 Incentive Plan. If an executive voluntarily
resigns from the Company, then the executive will not be
entitled to receive any payout with respect to his performance
cash awards unless he has been continuously employed until the
end of the performance period and the applicable performance
goals have been met, and the executive may continue to exercise
vested stock options and stock appreciation rights for
90 days following the date of resignation.
Termination
Upon Retirement, Disability or Death
Following termination of executives employment for
disability or death, the executive will receive all compensation
payable under the Companys disability and medical plans
and insurance policies, which are available generally to the
Companys salaried employees. In the event the Company was
to terminate Mr. Johnstons employment due to a
permanent disability, he would be entitled to the continuation
of his compensation benefits for the lesser of six months after
the Company terminates his employment or any waiting period set
forth in the disability insurance policy maintained by the
Company covering Mr. Johnston.
Upon retirement, death or disability, each participants
outstanding stock options and stock appreciation rights will
continue to vest and be exercisable in accordance with their
original terms as long as such awards were granted more than
180 days prior to date of termination. Outstanding
restricted stock and restricted stock units granted more than
180 days prior to date of termination are prorated based on
the number of full months that have elapsed from the date of
grant to the date of termination compared to the total number of
months from the date of grant until the vesting date, with no
change to the vesting date or performance conditions, if any.
Finally, outstanding performance-based cash awards made more
than 180 days prior to date of termination are prorated
from the beginning of the performance period to the date of
termination compared to the total number of months in the
original performance period, with no change to the vesting date
or performance conditions, if any.
In addition to the payments and benefits described above, the
Organization and Compensation Committee of the Board may
authorize additional payments when it separates a Named
Executive Officer. The Company might agree to make the payments
it deems necessary to negotiate a definitive termination
agreement with the terms, such as a general release of claims,
nondisparagement, cooperation with litigation, noncompetition
and nonsolicitation agreements, as determined by the Company.
37
DIRECTOR
COMPENSATION
The table below summarizes the compensation paid by the Company
to non-employee directors for the fiscal year ended
December 31, 2007. Directors who are employees of the
Company receive no additional compensation for serving on the
board or its committees.
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Fees Earned or
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Stock Awards
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All Other
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Paid in Cash
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(2)(3)
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Compensation
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Total
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Name
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($)(1)
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($)
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($)(4)
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($)
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William H. Gray, III
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80,000
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(11,892
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)
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125
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68,233
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Patricia L. Higgins
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80,000
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(6,905
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)
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125
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73,220
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Karl J. Krapek
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90,000
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(11,892
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)
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125
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78,233
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Charles L. Schaffer
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95,000
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(11,892
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)
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125
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83,233
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Richard J. Taggart
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80,000
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38,412
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125
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118,537
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James D. Thornton
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80,000
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(6,905
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)
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125
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73,220
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Kenneth B. Woodrow
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80,000
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(6,905
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)
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896
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73,991
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(1)
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The following directors deferred
2007 cash compensation into their deferred unit account under
the Deferred Compensation Plan for Non-Employee Directors
(further described below):
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2007 Cash
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Name
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Deferred
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Mr. Krapek
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$
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90,000
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Mr. Schaffer
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$
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95,000
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Mr. Woodrow
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$
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80,000
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(2)
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These amounts represent the
compensation cost of unvested restricted stock and restricted
stock units granted during 2007 and in prior years for financial
reporting purposes for 2007 under FAS 123(R). Negative
values are the result of the reversal of compensation expense
recognized in previous years due to a market decline in awards
classified as liability awards under FAS 123(R). A discussion of
assumptions relevant to calculating these values may be found in
Note 7 to our consolidated financial statements included in
our Annual Report on
Form 10-K
for the 2007 fiscal year. There can be no assurance that the
amounts reflected in the table above will ever be realized. As
of December 31, 2007, Mr. Gray owned 21,742 stock
units; Ms. Higgins owned 20,735 stock units;
Mr. Krapek owned 21,742 stock units; Mr. Schaffer
owned 21,742 stock units; Mr. Taggart owned 8,750 stock
units; Mr. Thornton owned 20,735 stock units; and
Mr. Woodrow owned 20,735 stock units.
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(3)
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The grant date fair value of all
stock units awarded to each director in 2007 is $70,000.
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(4)
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The All Other
Compensation column includes the amount of various
reportable perquisites and other personal benefits, including
the personal use of company products. This column also includes
tax
gross-ups
made by the Company in 2007 on behalf of Mr. Woodrow ($771)
related to perquisites and other personal benefits.
|
Non-employee directors receive an annual retainer paid in cash
of $70,000. Committee chairs and Audit Committee members receive
an additional annual committee retainer of $10,000, except the
Chair of the Audit Committee who receives $15,000. All retainers
are paid in quarterly installments. Non-employee directors may
elect to defer up to 100% of their total retainer under the
Deferred Compensation Plan for Non-Employee Directors, a
nonqualified benefit plan, into a unit account. Amounts deferred
into the unit account are allocated based on the average of the
high and low price of the Companys common stock on the
date of the deferral, and the value of this account is directly
related to the performance of the Companys common stock.
Amounts deferred are distributed following termination of board
service in a lump sum or in ten annual installments on the later
of January 15th of the year following or six months
after the date of termination of service. In addition, the
Company reimburses its directors for expenses, including travel
and entertainment, they incur in connection with attending board
and committee meetings.
Pursuant to the terms of the Non-Employee Director Stock Unit
Plan, as amended and approved by our stockholders, on the day
following the Companys annual meeting, each of the
non-employee directors receives a stock unit award valued at
$70,000. The number of stock units allocated to each
directors account is based on average of the high and low
price of the Companys stock on the date of the award.
These stock unit awards are fully vested in that they are not
subject to forfeiture; however, they are not distributed until
the director terminates board service and are payable in a lump
sum or ten annual installments on the later of
January 15th of the year following or six months after
the date of termination of service.
38
To further link director and stockholder interests, the Company
has established stock ownership guidelines for non-employee
directors. Each non-employee director has a goal to own
15,000 shares of common stock within five years of their
appointment as a director. Units held in the Non-Employee
Director Stock Unit Plan or Deferred Compensation Plan for
Non-Employee Directors are counted toward this goal.
AUDIT
COMMITTEE REPORT
The Audit Committee operates under a written charter adopted by
the Board of Directors. Visteon management has the primary
responsibility for the Companys internal controls and the
financial reporting process. The Independent Registered Public
Accountants are responsible for performing an independent audit
of the Companys consolidated financial statements and
issuing an opinion on the conformity of those audited financial
statements with accounting principles generally accepted in the
United States of America. The Independent Registered Public
Accountants also express an opinion, based on an audit, on the
effectiveness of Visteons internal control over financial
reporting. The Audit Committee oversees and monitors these
processes and reports to the Board of Directors on its findings.
During 2007, the Audit Committee held eleven meetings.
Auditor
Independence
During the year, the Audit Committee met and held discussions
with Visteon management and PricewaterhouseCoopers LLP. The
Audit Committee reviewed and discussed with Visteon management
and PricewaterhouseCoopers LLP the audited financial statements
contained in the companys Annual Report on
Form 10-K
for the year ended December 31, 2007, as well as the
Companys internal control over financial reporting. The
Audit Committee also discussed with PricewaterhouseCoopers LLP
the matters required to be discussed under the Statement on
Auditing Standards No. 61 (Communications with Audit
Committees), as amended.
PricewaterhouseCoopers LLP submitted to the Audit Committee the
written disclosures and the letter required by Independence
Standards Board Standard No. 1 (Independence Discussions
with Audit Committees). The Audit Committee discussed with
PricewaterhouseCoopers LLP the firms independence and
considered whether the provision of non-audit services by
PricewaterhouseCoopers LLP to the Company is compatible with
maintaining the independence of PricewaterhouseCoopers LLP. The
Audit Committee concluded that the independence of
PricewaterhouseCoopers LLP from Visteon and management is not
compromised by the provision of such non-audit services.
Based on these reviews and discussion, the Audit Committee
recommended to the Board of Directors that the audited financial
statements be included in the Companys Annual Report on
Form 10-K
for the year ended December 31, 2007, and filed with the
SEC.
Audit Committee
Charles L. Schaffer (Chairman)
Karl J. Krapek
Alex J. Mandl
Richard J. Taggart
Kenneth B. Woodrow
The Audit Committee Report does not constitute soliciting
material, and shall not be deemed to be filed or incorporated by
reference into any other Visteon filing under the Securities Act
of 1933, as amended, or the Securities Exchange Act of 1934, as
amended, except to the extent that Visteon specifically
incorporates this Audit Committee Report by reference into any
such filing.
39
AUDIT
FEES
The Audit Committee selects, subject to shareholder
ratification, our Independent Registered Public Accountants for
each fiscal year. During the year ended December 31, 2007,
PricewaterhouseCoopers LLP was employed principally to perform
the annual audit of the Companys consolidated financial
statements and the effectiveness of internal control over
financial reporting and to provide other services. Fees paid to
PricewaterhouseCoopers LLP for each of the past two years are
listed in the following table:
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Audit
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Audit
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All Other
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Year Ended December 31,
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Services Fees
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Related Fees
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Tax fees
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Fees
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2007
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|
$
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9,856,000
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|
$
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429,000
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$
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1,089,000
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$
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22,000
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2006
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$
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9,743,000
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$
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307,000
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$
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689,000
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|
$
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Audit services fees include fees for services performed to
comply with Sarbanes-Oxley Section 404 and Generally
Accepted Auditing Standards (GAAS) as adopted by the
Public Company Accounting Oversight Board and approved by the
SEC, including the recurring audit of the Companys
consolidated financial statements. This category also includes
fees for audits provided in connection with statutory filings or
services that generally only the principal auditor reasonably
can provide to a client, such as procedures related to the audit
of income tax provisions and related reserves, and consents,
assistance, and review of documents filed with the SEC.
Audit-related fees include fees associated with assurance and
related services that are reasonably related to the performance
of the audit or review of the Companys financial
statements. This category includes fees related to assistance in
financial due diligence related to mergers and acquisitions,
consultations regarding Generally Accepted Accounting Principles
(GAAP), reviews and evaluations of the impact of new
regulatory pronouncements, and audit services performed related
to benefit/pension plans.
Tax fees primarily include fees associated with tax compliance,
as well as domestic and international tax planning.
All other fees pertain to administrative services for
international service employees and transaction support.
AUDIT
COMMITTEE PRE-APPROVAL POLICIES AND PROCEDURES
The Audit Committee has adopted procedures for its annual review
and
pre-approval
of all audit and permitted
non-audit
services provided by the Independent Registered Public
Accountants. These procedures include reviewing and approving a
budget for audit and permitted
non-audit
services by category. The Audit Committee considers whether such
services are consistent with the SECs rules on auditor
independence. The Audit Committee also considers whether the
Independent Registered Public Accountants are best positioned to
provide the most effective and efficient service, for reasons
such as its familiarity with the Companys business,
people, culture, accounting systems, risk profile, and whether
the services enhance the Companys ability to manage or
control risks and improve audit quality. The Audit Committee
will, as necessary, consider and, if appropriate, approve the
provision of additional audit and
non-audit
services by its Independent Registered Public Accountants that
are not encompassed by the Audit Committees annual
pre-approval
and not prohibited by law. The Audit Committee has delegated to
the Chairman of the Audit Committee the approval authority, on a
case-by-case
basis, for services outside of or in excess of the Audit
Committees aggregate
pre-approved
levels and not prohibited by law. In order to monitor services
rendered and actual fees paid and commitments to be paid to the
Independent Registered Public Accountants, the Chairman, or
designee, shall report any such decisions to the Audit Committee
at its next regular meeting.
ITEM 2.
APPROVAL OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
The next proposal on the agenda for the Annual Meeting will be
ratifying the appointment of PricewaterhouseCoopers LLP by the
Audit Committee as the Companys independent registered
public accounting firm for fiscal year 2008.
PricewaterhouseCoopers LLP served in this capacity for fiscal
year 2007, and has reported on the Companys 2007
consolidated financial statements.
40
Representatives of PricewaterhouseCoopers LLP, the
Companys independent registered public accounting firm,
are expected to be present at the Annual Meeting. They will have
the opportunity to make a statement at the meeting if they
desire to do so and are expected to be available to respond to
appropriate questions. For information regarding fees paid to
PricewaterhouseCoopers LLP, see Audit Fees on
page 40.
The Board of Directors Recommends that You Vote FOR the
Ratification of PricewaterhouseCoopers LLP as the Companys
Independent Registered Public Accounting Firm for Fiscal Year
2008.
ITEM 3.
APPROVAL OF AMENDMENTS TO VISTEON CORPORATION 2004
INCENTIVE PLAN
The next proposal on the agenda for the Annual Meeting will be
to approve amendments to the Visteon Corporation 2004
Incentive Plan (hereinafter, the Incentive Plan).
The Incentive Plan was originally adopted effective as of
June 28, 2000 as the 2000 Incentive Plan (and approved by
stockholders on May 9, 2001), and subsequently amended and
restated on March 16, 2004 (and approved by stockholders on
May 12, 2004). The Incentive Plan was further amended on
March 16, 2006 (and approved by stockholders on
May 10, 2006) and June 14, 2007. The Board of
Directors, following the approval and recommendation of the
Organization and Compensation Committee, adopted the proposed
amendments to the Incentive Plan on March 13, 2008, subject
to stockholder approval at the Annual Meeting.
The amendments to the Incentive Plan include the following
changes from the existing plan:
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eliminate the restriction on the maximum number of shares of
common stock that may be awarded under the Incentive Plan
pursuant to stock rights, restricted stock, restricted stock,
units (but only to the extent that each such restricted stock
unit may be settled by the delivery of shares of common stock)
and other
stock-based
awards; and
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eliminate the restriction on the maximum number of shares that
may be issued under the Incentive Plan as authorized and
unissued shares, currently 2,000,000 shares.
|
Visteon believes that making a significant portion of the
compensation of certain employees, whose efforts can affect the
value of Visteon, depend upon the
long-term
performance of our common stock encourages those employees to
work in a way that maximizes stockholder value. The proposed
amendments to the Incentive Plan will not increase the total
number of shares of Common Stock that may be granted under the
Incentive Plan, but will instead enable the Company to choose
the appropriate mix of awards to be made under the plan subject
to the current overall limit. As of December 31, 2007,
there were 7,403,206 shares not subject to outstanding
awards under the Incentive Plan, of which only
150,833 shares were available for full value
awards, i.e., stock rights, restricted stock, and restricted
stock units (to the extent it may be settled by the delivery of
common stock). The Company determined that in order for the plan
to continue to fully serve the purposes for which it was
adopted, it would be important to ensure that full value shares
remain available for issuance to maintain a competitive
compensatory program. In addition, because no exercise price is
associated with full value share awards, fewer shares of stock
can be issued under the plan to achieve the same compensatory
and incentivizing effect. Currently, in addition to stock
options
and/or stock
appreciation rights, the Company awards restricted stock units
that are settled solely in cash, which creates significant
variability in the Companys income statements as our stock
price changes. Further, providing restricted stock or restricted
stock units that may be settled in stock better aligns
participants with
long-term
shareholder value creation because they may continue to hold the
shares of stock indefinitely following vesting, which is not
possible with restricted stock units that are settled solely in
cash.
The proposed amendments also will give Visteon the flexibility
to conserve the amount of cash needed to satisfy awards made
under the Incentive Plan by permitting the company to issue new
shares instead of primarily using treasury shares (shares that
have been reacquired through share repurchase programs).
Although the company intends to use a mix of treasury shares and
newly-issued
shares, the proposed amendment will make the Incentive Plan more
competitive and flexible in an uncertain credit and industry
environment.
41
Summary
of the Incentive Plan
The following is only a summary of the Incentive Plan, as
proposed to be amended, and is qualified in its entirety by
reference to its full text, a copy of which is attached as
Appendix B to this proxy statement.
The Incentive Plan is administered by the Organization and
Compensation Committee of the Board of Directors. The Incentive
Plan provides for the payment of performance cash awards and the
grant of incentive and nonqualified stock options, stock
appreciation rights, performance stock rights (stock
rights), restricted stock, restricted stock units and
various other rights based on stock (individually, an
award or collectively, awards). Salaried
employees, as well as certain
non-employees,
of Visteon with potential to contribute to the future success of
Visteon or its subsidiaries will be eligible to receive awards
under the Incentive Plan. The Organization and Compensation
Committee has the discretion to select the employees to whom
awards will be granted, to determine the type, size and terms
and conditions applicable to each award and the authority to
interpret, construe and implement the provisions of the
Incentive Plan. The Organization and Compensation
Committees decisions will be binding. The Organization and
Compensation Committee also may delegate to a committee of
Visteon officers the selection of eligible employees and the
determination of the amount of individual awards for employees
and certain
non-employees
who are not executive officers of Visteon, within limitations
prescribed by the Organization and Compensation Committee.
Limits
on Plan Awards
The total number of shares of our common stock that may be
subject to awards under the Incentive Plan, referred to as the
overall limit, is 21,800,000, subject to adjustment
as provided in the Incentive Plan. For calendar years after
2003, no more than 1,000,000 shares of our common stock may
be subject to stock options (with or without any related stock
appreciation rights) or to
stand-alone
stock appreciation rights awarded to any covered
employee, which generally means our chief executive
officer and the next four most highly paid executive officers,
in any one calendar year. Common stock issued under the
Incentive Plan may be either authorized but unissued shares,
treasury shares or any combination thereof. For calendar years
after 2003, no more than 1,000,000 shares of common stock
may be available as awards pursuant to
performance-based
stock rights, restricted stock and restricted stock units
granted under the Incentive Plan to any covered employee in any
one calendar year. Any shares of common stock subject to an
award that lapses, expires or is otherwise terminated without
the issuance of such shares may become available for future
awards.
Stock
Options
Options to purchase shares of our common stock, which may be
incentive or nonqualified stock options, may be granted under
our Incentive Plan at an exercise price (the option
price) at least equal to the average of the highest and
lowest prices at which Visteon common stock was traded on the
New York Stock Exchange on the date of grant. Each option
represents the right to purchase one share of common stock at
the specified option price.
Options granted after December 31, 2005 will expire not
later than seven years after the date on which they are granted.
Options granted after December 31, 2003 and on or prior to
December 31, 2005 will expire not later than five years
after the date on which they are granted. Options granted on or
prior to December 31, 2003 will expire not later than
10 years after the date on which they are granted. Options
become exercisable at such times and in such installments as
determined by the Organization and Compensation Committee.
Payment of the option price can either be made in full at the
time of exercise by check or wire transfer, or, if the
Organization and Compensation Committee so determines and the
participant so elects, in installments. Payment in full or in
part may also be made by tendering to Visteon shares of our
common stock (including shares subject to the option being
exercised) having a fair market value equal to the option price
(or such portion thereof).
42
Stock
Appreciation Rights
An award of a stock appreciation right may be granted under the
Incentive Plan. Generally, one stock appreciation right is
granted with respect to one share of our common stock. The stock
appreciation right entitles the participant, upon the exercise
of the stock appreciation right, to receive an amount equal to
the appreciation in the underlying share of common stock. The
appreciation is equal to the difference between (1) the
base value of the stock appreciation right (i.e.,
the option price on the date the stock appreciation right is
granted), and (2) the average of the highest and lowest
prices at which Visteon common stock was traded on the New York
Stock Exchange on the date the stock appreciation right is
exercised. Upon the exercise of a vested stock appreciation
right, the exercising participant will be entitled to receive
the appreciation in the value of one share of common stock as so
determined, payable at the discretion of the Organization and
Compensation Committee in cash, shares of common stock, or some
combination thereof, subject to the availability of our shares
of common stock.
Stock appreciation rights granted after December 31, 2005
will expire not later than seven years after the date on which
they are granted. Stock appreciation rights granted after
December 31, 2003 and on or prior to December 31, 2005
will expire not later than five years after the date on which
they are granted. Stock appreciation rights granted on or prior
to December 31, 2003 will expire not later than
10 years after the date on which they are granted. Stock
appreciation rights become exercisable at such times and in such
installments as determined by the Organization and Compensation
Committee.
Tandem
Options/Stock Appreciation Rights
An option and a stock appreciation right may be granted in
tandem with each other. An option and a stock appreciation
right are considered to be in tandem with each other because the
exercise of the option aspect of the tandem unit automatically
cancels the right to exercise the stock appreciation right
aspect of the tandem unit, and vice versa. The option may be an
incentive stock option or a nonqualified stock option, as
determined by the Organization and Compensation Committee.
Descriptions of the terms of the option and the stock
appreciation right aspects of a tandem option/stock appreciation
right are provided above.
Material
U.S. Federal Income Tax Consequences of Options
Awards granted under the Incentive Plan may result in federal
income tax consequences to Incentive Plan participants and
Visteon. Some of those federal income tax consequences with
respect to options are generally set forth in the following
summary.
An employee who is granted an incentive stock option that
qualifies under Section 422 of the Code will not recognize
income at the time of grant or exercise of such option. Visteon
will not be entitled to a federal income tax deduction upon the
grant or exercise of an incentive stock option. However, upon
the exercise of an incentive stock option, any excess in the
fair market price of the common stock over the option price
constitutes a tax preference item that may have alternative
minimum tax consequences for the employee. When the employee
sells the shares more than one year after the date of transfer
of the shares and more than two years after the date of grant of
the incentive stock option, the employee will normally recognize
a long-term
capital gain or loss equal to the difference, if any, between
the sales price of the shares and the aggregate option price. In
such event, Visteon will not be entitled to a federal income tax
deduction with respect to the exercise of the incentive stock
option or the sale of the shares. If the employee does not hold
the shares for the required period, when the employee sells the
shares, the employee will recognize ordinary compensation income
and possibly capital gains or losses in such amounts as are
prescribed by the Code and Visteon will generally be entitled to
a federal income tax deduction in the amount of such ordinary
compensation income.
An employee who is granted a nonqualified stock option will not
recognize income at the time of grant of the option. In general,
when the employee exercises a nonqualified stock option, the
employee will recognize ordinary compensation income equal to
the difference, if any, between the option price paid and the
fair market value, as of the date of option exercise, of the
shares of common stock the employee receives. The tax basis of
the shares to the employee will be equal to the option price
paid, plus the amount includible in the employees gross
income, and the employees holding period for such shares
will commence on the date of exercise. Subject to the Code,
Visteon will generally be entitled to a federal income tax
deduction in respect of a nonqualified stock option in an amount
equal to the ordinary compensation income recognized by the
employee upon the exercise of the nonqualified stock option.
43
Restricted
Stock and Restricted Stock Units
Subject to the limits discussed above, the Organization and
Compensation Committee may authorize the award of restricted
stock and restricted stock units to employees under the
Incentive Plan. Restricted stock awards are issuances of our
common stock to employees that are subject to restrictions on
transfer and forfeiture if one or more specified performance
goals or minimum periods of service are not attained. Restricted
stock units may also be awarded in lieu of, or in addition to,
restricted stock awards and consist of a unit credited to a
hypothetical account, valued based on the fair market value of
our common stock, and subject to forfeiture if one or more
specified performance goals or minimum periods of service are
not attained. Prior to the expiration of the restriction period,
a grantee that has received a restricted stock award generally
has the rights of a stockholder of Visteon, including the right
to vote and to receive cash dividends on the shares subject to
the award. If the Organization and Compensation Committee so
determines, the holder of a restricted stock unit may receive
cash payments equivalent in value to dividends paid on our
common stock, either at the time the dividends are otherwise
payable or upon the payment of the final award relating to such
restricted stock unit. The Organization and Compensation
Committee will determine in advance of each award the terms and
conditions applicable to each award of restricted stock and
restricted stock units, including the applicable performance
criteria or minimum periods of service required, and whether
awards of restricted stock units will be settled in cash or in
shares of common stock, and may make certain adjustments to the
performance criteria and the amount of final awards.
Performance
Stock Rights and Other Stock Awards
Subject to the limits discussed above, the Organization and
Compensation Committee may authorize the award of performance
stock rights to employees under the Incentive Plan. Performance
stock rights represent the right to receive shares of our common
stock if one or more specified performance goals are attained.
If the Organization and Compensation Committee so determines,
the holder of a performance stock right may receive cash
payments equivalent in value to dividends paid on our common
stock, either at the time the dividends are otherwise payable or
upon the payment of the final award relating to such performance
stock right. The Organization and Compensation Committee will
determine in advance of each award the terms and conditions
applicable to each award of performance stock right, including
the applicable performance criteria, and whether awards of
performance stock rights may be settled in cash or other stock
equivalents, and may make certain adjustments to the performance
criteria and the amount of final awards.
The Organization and Compensation Committee also may grant other
stock-based
awards to such employees as it may select. These awards may
include awards of restricted stock, stock units, phantom
stock and options not otherwise specifically addressed
above. The Organization and Compensation Committee may determine
the time or times at which these awards will be made, the number
of shares of common stock or stock units and the like to be
granted or covered pursuant to such awards, including, whether
such awards will be payable or paid in cash, common stock or
otherwise, and whether the awards will be granted as a bonus for
no consideration other than services rendered.
Performance
Cash Awards
The Organization and Compensation Committee may award or
authorize performance cash awards to such employees as it may
select, and in such amounts as it may designate, subject to the
terms of the Incentive Plan. The Organization and Compensation
Committee determines the performance period and performance
criteria for a performance cash award. Within 90 days of
the beginning of a performance period, the Organization and
Compensation Committee decides the targeted performance level at
which a target award may be earned. The Organization and
Compensation Committee decides the target award based on the
employees level of responsibility and other factors. The
target award, designated as a percentage of base salary, is
based on achieving 100% of the performance goals established by
the Organization and Compensation Committee for the performance
period. The Organization and Compensation Committee also decides
any minimum performance level below which no cash award would be
paid. The maximum amount that may be granted to a covered
employee as a final award with respect to one or more
performance cash awards during any calendar year is $10,000,000.
44
As soon as practicable following the completion of the
performance period, the Organization and Compensation Committee
determines the extent to which the participant achieved the
performance goals and the amount of compensation to be awarded
as a final award by applying the applicable performance formula
against the accomplishment of the related performance goals. The
Organization and Compensation Committee may, in its sole
discretion, reduce the amount of any final award to any
participant or increase the amount of any final award to any
participant who is not a covered employee. In making such
adjustments, the Organization and Compensation Committee shall
take into account the extent to which the performance goals were
achieved, individual performance, and such other factors as the
Organization and Compensation Committee may deem relevant, such
as a change in circumstances or unforeseen events during the
performance period.
Additional
Information
Under the Incentive Plan, in the event of a merger,
consolidation, reorganization, stock split, stock dividend or
other event affecting our common stock, such adjustments as may
be necessary (as determined by the Organization and Compensation
Committee) to reflect such change will be made to prevent
dilution or enlargement of the rights with respect to the
overall limit, the option limit, the annual and aggregate stock
right limits, the number of shares of common stock covered by
each outstanding award, any other references in the Incentive
Plan to a number of shares and the price per share in respect
thereof.
Conditions
Unless otherwise determined by the Organization and Compensation
Committee, an individuals rights under the Incentive Plan
may not be assigned or transferred (except in the event of
death). An individuals rights under the Incentive Plan are
subject to forfeiture for competitive activity or activity that
is not in our best interest.
Funding
All administrative expenses of the Incentive Plan will be paid
for by the company and its participating subsidiaries.
Amendment
and Termination of Plan
Unless terminated earlier by the Board of Directors, the
Incentive Plan will terminate on May 11, 2014. The Board of
Directors may at any time terminate, modify or amend the
Incentive Plan; provided, however, that the Board may not,
without the approval of the stockholders, (1) increase the
overall limit, the option limit, the performance cash limit or
the annual and aggregate limits applicable to stock rights,
restricted stock, restricted stock units and other
stock-based
awards, (2) extend the term of the plan, (3) permit a
member of the Organization and Compensation Committee to
participate, or (4) decrease the grant price of any
outstanding option or stock appreciation right. Also, the
Organization and Compensation Committee may not, without
shareholder approval, grant substitute awards to replace
outstanding options with a higher grant price than the
substitute awards.
The Incentive Plan provides for acceleration of vesting and
distribution of some plan awards in the event of a change of
control of the company.
Other
Information
Since it is within the discretion of the Organization and
Compensation Committee to determine which employees will receive
grants under the Incentive Plan and the type and amount thereof,
these matters cannot be specified at present. While nearly all
of the approximately 14,000 salaried employees of Visteon and
its subsidiaries are eligible under the literal terms of the
Incentive Plan to receive grants under the plan, it is presently
contemplated (and has been the Organization and Compensation
Committees practice in the past) that grants of stock
options and stock appreciation rights, and to a lesser extent if
at all, grants of restricted stock and restricted stock units,
would be made primarily to senior and middle managers, including
the Named Executives, which currently includes approximately
125 employees. For stock option, stock appreciation rights
and restricted stock unit grants as well as other benefits
awarded to our Named Executives in 2007 under our Incentive Plan
see Executive Compensation beginning on page 12.
45
On March 17, 2008, the New York Stock Exchange reported a
closing price of $3.33 for our common stock.
The Board of Directors recommends that you vote FOR the
approval of the amendments to the Visteon Corporation 2004
Incentive Plan.
ITEM 4.
CONSIDERATION OF A STOCKHOLDER PROPOSAL RELATING TO
SPECIAL SHAREHOLDER MEETINGS
The next proposal on the agenda for the Annual Meeting will be a
stockholder proposal relating to the ability to call special
shareholder meetings. In accordance with SEC rules, the text of
the stockholder proposal is printed exactly as it was submitted.
John Chevedden, 2215 Nelson Avenue, Redondo Beach, California
90278, has informed the company that he intends to present for
consideration at the Annual Meeting the following proposal on
behalf of Mr. Jack E. Leeds, and has furnished
the following statement in support of the proposal:
4
SPECIAL SHAREHOLDER MEETINGS
RESOLVED, Shareholders ask our board to amend our bylaws
and/or any
other appropriate governing documents in order that there is no
restriction on the shareholder right to call a special meeting,
compared to the standard allowed by applicable law on calling a
special meeting.
Special meetings allow investors to vote on important matters,
such as a takeover offer, that can arise between annual
meetings. If shareholders cannot call special meetings,
management may become insulated and investor returns may suffer.
Shareholders should have the ability to call a special meeting
when they think a matter is sufficiently important to merit
expeditious consideration. Shareholder control over timing is
especially important regarding a major acquisition or
restructuring, when events unfold quickly and issues may become
moot by the next annual meeting.
Eighteen (18) proposals on this topic averaged
56%-support
in 2007 including
74%-support
at Honeywell (HON) according to RiskMetrics (formerly
Institutional Shareholder Services). Fidelity and Vanguard
support a shareholder right to call a special meeting.
The merits of this proposal should also be considered in the
context of our companys overall corporate governance
structure and individual director performance. For instance in
2007 the following structure and performance issues were
identified:
|
|
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The Corporate Library
http://www.thecorporatelibrary.com,
an independent investment research firm, rated our company
High Concern in executive pay.
|
|
|
Our Company will take
3-years to
transition to annual election of each director when
the transition could be completed in
one-year.
|
|
|
This is especially important when we had only three directors
standing for election in 2007 and two of these directors
received
double-digit
withhold votes:
|
Ms. Higgins
Mr. Krapek
|
|
|
|
|
Our directors also served on boards rated D by The Corporate
Library:
|
|
|
|
1) Ms. Higgins
|
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Barnes & Noble (BKS)
Internap Network (INAP)
|
2) Mr. Gray
|
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JPMorgan (JPM)
Dell (PFE)
|
|
|
|
|
|
Plus Mr. Gray (who served on our nomination and executive
pay committees) was also designated as an Accelerated
Vesting director by The Corporate Library due to his
involvement with a board that sped up stock option vesting in
order to avoid recognizing the associated cost.
|
|
|
Also Ms. Higgins and Mr. Gray served on 5
boards
Over-commitment
concern.
|
Additionally:
|
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We did not have an Independent Chairman or even a Lead
Director Independence concern.
|
46
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|
|
We had no shareholder right to:
|
1) Cumulative voting.
2) Act by written consent.
3) Call a special meeting.
4) A majority vote requirement in the election of our
directors.
|
|
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Mr. Taggart owned zero stock even at $5 a share
Commitment concern.
|
The above concerns show there is room for improvement and
reinforces the reason to encourage our board to respond
positively to this proposal:
SPECIAL
SHAREHOLDER MEETINGS
Yes on 4
The Board of Directors Recommends that You Vote Against
this Proposal for the Reasons Set Forth Below:
Under our
By-Laws, a
special meeting of stockholders may be called by the Board, the
Chairman or the President. The current
By-Law
provision is an appropriate corporate governance provision for a
public company of our size because it allows the directors and
senior management, consistent with their fiduciary obligations,
to exercise their business judgment to determine when it is in
the best interests of stockholders to convene a special meeting.
Calling special meetings of stockholders is not a matter to be
taken lightly. For a company with as many stockholders as
Visteon, a special meeting of stockholders is a very expensive
and
time-consuming
affair because of the costs in preparing required disclosure
documents, printing, mailing and other costs, and the time
commitment required of the Board and members of senior
management to prepare for and conduct the meeting. This proposal
would enable one or more stockholders holding a single share to
call one or more special meetings that could impose substantial
administrative and financial burdens on the Company and
significantly disrupt the conduct of its business. Special
meetings of stockholders should be extraordinary events that
only occur when either fiduciary obligations or strategic
concerns require that the matters to be addressed cannot wait
until the next annual meeting. The Board of Directors and our
senior management are best positioned to determine whether
circumstances warrant a special meeting.
For these Reasons, the Board of Directors Recommends that
You Vote AGAINST this Proposal.
OTHER
MATTERS
Neither the Company nor its directors intend to bring before the
Annual Meeting any matter other than the election of the eight
directors, the ratification of the Companys independent
public accounting firm, approval of amendments to the
Companys 2004 Incentive Plan and consideration of a
shareholder proposal. Also, they have no present knowledge that
any other matter will be presented by others for action at the
meeting.
2009
STOCKHOLDER PROPOSALS AND NOMINATIONS
Stockholder proposals that are intended to be included in the
Companys proxy materials for the 2009 Annual Meeting must
be presented pursuant to Securities and Exchange Commission
Rule 14a-8
and received by the Corporate Secretary of the Company no later
than December 1, 2008.
A stockholder that intends to present business at the 2009
Annual Meeting other than pursuant to
Rule 14a-8,
which may not be included in the Companys proxy materials,
must comply with the requirements set forth in the
Companys
By-Laws.
Among other things, a stockholder must give written notice of
its intent to bring business before the 2009 Annual Meeting to
the Company no later than December 1, 2008. However, if the
date for the 2009 Annual Meeting is more than 30 calendar days
prior to, or after, May 14, 2009, then such written notice
must be received no later than the tenth day following the day
on which we announce the annual meeting date to the public. This
written notice must contain specified information as set forth
in the Companys
By-Laws.
47
You may recommend any person to be a director by writing to the
Corporate Secretary of the Company. The deadline for submitting
written notice nominating a director is the same as that set
forth above for other matters proposed to be presented at the
2009 Annual Meeting. This notice also must include, among other
things, the name, age, address, occupations and stockholdings of
the proposed nominee.
To the extent permitted, the Company may exercise discretionary
voting authority under proxies it solicits to vote in accordance
with its best judgment on any such stockholder proposal or
nomination.
MISCELLANEOUS
The Company has adopted a code of business conduct and ethics
entitled, Ethics and Integrity Policy, which is
applicable to the directors and all employees of the Company,
including the principal executive officer, the principal
financial officer and the principal accounting officer. A copy
of the ethics policy, as well as the Corporate Governance
Guidelines and charters of all standing Board committees, are
available on our website at www.visteon.com, by contacting our
Shareholder Relations department in writing at One Village
Center Drive, Van Buren Township, MI 48111; by phone
(877) 367-6092;
or via email at vcstock@visteon.com.
Visteons 2007 Annual Report to Stockholders, including its
Annual Report on
Form 10-K
for the year ended December 31, 2007 (and consolidated
financial statements), is being made available to you with this
Proxy Statement. Stockholders may obtain, at no charge, an
additional copy of our Annual Report on
Form 10-K
for the year ended December 31, 2007, including exhibits
thereto, by contacting our Shareholder Relations department in
writing at One Village Center Drive, Van Buren Township, MI
48111; by phone
(877) 367-6092;
or via email at vcstock@visteon.com. Our periodic and
current reports, including our Annual Report on
Form 10-K,
and any amendments thereto, are also available through our
internet website at www.visteon.com/investors.
The SEC has adopted rules that allow us to send in a single
envelope our Notice of Internet Availability of Proxy Materials
or a single copy of our proxy solicitation and other required
annual meeting materials to two or more stockholders sharing the
same address. We may do this only if the stockholders at that
address share the same last name or if we reasonably believe
that the stockholders are members of the same family. If we are
sending a Notice, the envelope must contain a separate Notice
for each stockholder at the shared address. Each Notice must
also contain a unique control number that each stockholder will
use to gain access to our proxy materials and vote online. If we
are mailing a paper copy of our proxy materials, the rules
require us to send each stockholder at the shared address a
separate proxy card.
We believe this rule is beneficial to both our stockholders and
to us. Our printing and postage costs are lowered anytime we
eliminate duplicate mailings to the same household. However,
stockholders at a shared address may revoke their consent to the
householding program and receive their Notice in a separate
envelope, or, if they have elected to receive a full copy of our
proxy materials in the mail, receive a separate copy of these
materials. If you have elected to receive paper copies of our
proxy materials and want to receive a separate copy of these
materials, please call Broadridge at
(800) 542-1061.
If you consented to the householding program and wish to revoke
your consent for future years, simply call, toll free,
(800) 542-1061,
or write to Broadridge, Householding Department, 51 Mercedes
Way, Edgewood, New York 11717.
If I received more than one Notice of Internet Availability of
Proxy Materials or proxy card, then you probably have multiple
accounts with us
and/or
brokers, banks or other nominees. You should vote all of the
shares represented by these Notices/proxy cards. Certain
brokers, banks and nominees have procedures in place to
discontinue duplicate mailings upon a stockholders
request. You should contact your broker, bank or nominee for
more information. Additionally, our transfer agent, BNY Mellon
Shareowner Services, can assist you if you want to consolidate
multiple registered accounts existing in your name. To contact
our transfer agent, write to BNY Mellon Shareowner Services, 480
Washington Blvd., Jersey City, NJ
07310-1900,
or call
(866) 881-5962.
48
APPENDIX A
Visteon Director Independence Guidelines
A director will be deemed independent, and to have
no direct or indirect material relationship with the company
(either directly or as a partner, shareholder or officer of an
organization that has a relationship with the company), if
he/she meets
all of the following criteria:
1. Has not been an employee of Visteon or its subsidiaries
within the last three years.
2. Is not currently a partner or employee of Visteons
internal or external auditor or a former partner or employee of
Visteons internal or external auditor or was within the
last three years (but is no longer) a partner or employee of
Visteons internal or external auditor who personally
worked on Visteons audit within that time.
3. Has not been employed by a company in which,
concurrently with such employment, an executive officer of
Visteon served on the compensation committee of such company
within the last three years.
4. Has not received more than $100,000 per year in direct
compensation from Visteon or its subsidiaries within the last
three years, other than director or committee fees and pensions
or other forms of deferred compensation for prior service (and
not contingent on continued service).
5. Is not currently an executive officer or employee of a
company that, within the past three years, has made payments to,
or received payments from, Visteon or its subsidiaries for
property or services in an amount which, in any single fiscal
year, exceeded the greater of $1 million or 2% of such
other companys consolidated gross revenues for such year.
6. Has no immediate family member (1) who (i) has been
employed by Visteon as an officer, (ii) is a current
partner of Visteons internal or external auditor or a
current employee of Visteons internal or external auditor
who participates in the audit, assurance or tax compliance (but
not tax planning) practice, (iii) is a former partner or
employee of Visteons internal or external auditor who
personally worked on Visteons audit within the last three
years, (iv) has been employed as a an officer of another
company where a Visteon executive officer served on the
compensation committee of that company within the last three
years, (v) received more than $100,000 per year in direct
compensation from Visteon or its subsidiaries other than
pensions or other forms of deferred compensation for prior
service (and not contingent on continued service), or
(vi) is currently an officer of a company that has made
payments to, or received payments from, Visteon or its
subsidiaries for property or services in an amount which, during
any twelve month period, exceeded the greater of $1 million
or 2% of such other companys consolidated gross revenues
for such year, in each case, within the last three years.
7. Is not currently an executive officer of a
tax-exempt
organization that has received, within the preceding three
years, contributions from Visteon or its subsidiaries in any
single fiscal year in excess of the greater of $1 million
or 2% of such charitable organizations consolidated gross
revenues for such year.
8. Does not have any other relationships with the Company
or with members of senior management that the Board determines
to be material.
March 9, 2005
(1) A directors immediate family shall include his or
her spouse, parents, children, siblings, mothers and
fathers-in-law,
sons and
daughters-in-law
and brothers and
sisters-in-law
and anyone (other than domestic employees) who shares such
directors home.
A-1
APPENDIX B
Visteon Corporation
2004 INCENTIVE PLAN
(as proposed to be amended)
Section 1.
PURPOSE AND DEFINITIONS
(a) Purpose. This Plan, known as the
Visteon Corporation 2004 Incentive Plan, is
intended to provide an incentive to certain employees and
certain
non-employees
who provide services to Visteon Corporation and its
subsidiaries, in order to encourage them to remain in the employ
of the Company and its subsidiaries and to increase their
interest in the Companys success. It is intended that this
purpose be effected through awards or grants of stock options
and various other rights with respect to shares of the
Companys common stock, and through performance cash
awards, as provided herein, to such eligible employees.
(b) Definitions. The following terms
shall have the following respective meanings unless the context
requires otherwise:
(1) The term Affiliate or
Affiliates shall have the meaning set forth in
Rule 12b-2
promulgated under Section 12 of the Exchange Act.
(2) The term Beneficial Owner shall mean
beneficial owner as set forth in
Rule 13d-3
under the Exchange Act.
(3) The term Board shall mean the Board of
Directors of Visteon Corporation.
(4) The term Change in Control shall mean the
occurrence of any one of the following:
(A) any Person is or becomes the Beneficial Owner, directly
or indirectly, of securities of the Company (not including in
the securities beneficially owned by such Person any securities
acquired directly from the Company or its Affiliates)
representing 40% or more of the combined voting power of the
Companys then outstanding securities, excluding any Person
who becomes such a Beneficial Owner in connection with a
transaction described in clause (i) of paragraph
(C) below;
(B) within any twelve (12) month period, the following
individuals cease for any reason to constitute a majority of the
number of directors then serving: individuals who, on the
effective date of this Plan, constitute the Board and any new
director (other than a director whose initial assumption of
office is in connection with an actual or threatened election
contest, including but not limited to a consent solicitation,
relating to the election of directors of the Company) whose
appointment or election by the Board or nomination for election
by the Companys stockholders was approved or recommended
by a vote of at least
two-thirds
(2/3) of the directors then still in office who either were
directors on the date hereof or whose appointment, election or
nomination for election was previously so approved or
recommended;
(C) there is consummated a merger or consolidation of the
Company or any direct or indirect subsidiary of the Company with
any other corporation, other than (i) a merger or
consolidation which results in the directors of the Company
immediately prior to such merger or consolidation continuing to
constitute at least a majority of the board of directors of the
Company, the surviving entity or any parent thereof or
(ii) a merger or consolidation effected to implement a
recapitalization of the Company (or similar transaction) in
which no Person is or becomes the Beneficial Owner, directly or
indirectly, of securities of the Company (not including in the
securities Beneficially Owned by such Person any securities
acquired directly from the Company or its Affiliates)
representing 40% or more of the combined voting power of the
Companys then outstanding securities;
B-1
(D) the stockholders of the Company approve a plan of
complete liquidation or dissolution of the Company or there is
consummated an agreement for the sale or disposition by the
Company of more than 50% of the Companys assets, other
than a sale or disposition by the Company of more than 50% of
the Companys assets to an entity, at least 50% of the
combined voting power of the voting securities of which are
owned by stockholders of the Company in substantially the same
proportions as their ownership of the Company immediately prior
to such sale; or
(E) any other event that the Board, in its sole discretion,
determines to be a Change in Control for purposes of this Plan.
Notwithstanding the foregoing, a Change in Control
shall not be deemed to have occurred by virtue of the
consummation of any transaction or series of integrated
transactions immediately following which the record holders of
the common stock of the Company immediately prior to such
transaction or series of transactions continue to have
substantially the same proportionate ownership in an entity
which owns all or substantially all of the assets of the Company
immediately following such transaction or series of transactions.
(5) The term Code shall mean the Internal
Revenue Code of 1986, or any successor thereto, as the same may
be amended and in effect from time to time.
(6) The term Committee shall mean the committee
appointed pursuant to Section 2 to administer the Plan.
(7) The term Company shall mean
Visteon Corporation.
(8) The term Covered Executive shall mean the
Chief Executive Officer and the other four highest compensated
officers of the Company or any Subsidiary at
year-end
whose compensation is required to be reported in the Summary
Compensation Table of the Companys Proxy Statement.
(9) The term Employee shall mean an employee of
the Company or any Subsidiary. The term Employee
shall also be deemed to include any person who is an employee of
any joint venture corporation or partnership, or comparable
entity, in which the Company or Subsidiary has a substantial
equity interest, provided such person was an employee of the
Company or Subsidiary immediately prior to becoming employed by
such entity, and designated
non-employees
who provide services to the Company or a Subsidiary.
(10) The term Exchange Act shall mean the
Securities Exchange Act of 1934, or any successor thereto, as
the same may be amended and in effect from time to time.
(11) The term Fair Market Value shall mean the
average of the highest and lowest sale prices at which a share
of Stock shall have been sold regular way on the New York Stock
Exchange on the date of grant of any Option or Stock
Appreciation Right or other relevant valuation date. In the
event that any Option or Stock Appreciation Right shall be
granted, or other relevant valuation date shall occur, on a date
on which there were no such sales of Stock on the New York Stock
Exchange, the Fair Market Value of a share of Stock shall be
deemed to be the average of the highest and lowest sale prices
on the next preceding day on which there were such sales.
(12) The term Final Award shall mean the amount
of compensation to be awarded finally to the Participant who
holds a Performance Cash Right pursuant to Section 3, the
number of shares of Stock to be awarded finally to the
Participant who holds a Performance Stock Right pursuant to
Section 5, the number of shares of Restricted Stock to be
retained by the Participant who holds Restricted Stock pursuant
to Section 6, or the number of shares of Stock or the
amount of compensation to be awarded finally to a Participant
who holds Restricted Stock Units pursuant to Section 6, in
each case as determined by the Committee taking into account the
extent to which the Performance Goals have been satisfied.
(13) The term Option or Options
shall mean the option to purchase Stock in accordance with
Section 7 and such other terms and conditions as may be
prescribed by the Committee. An Option may be either an
incentive stock option, as such term is defined in
the Code, or shall otherwise be designated as an option entitled
to favorable treatment under the Code (ISO) or a
nonqualified stock option (NQO). ISOs
and NQOs are individually called an Option and
collectively called Options.
B-2
(14) The term Other
Stock-Based
Awards shall mean awards of Stock or other rights made in
accordance with Section 8.
(15) The term Participant shall mean an
Employee who has been designated for participation in the Plan.
(16) The term Performance Cash Right shall mean
the right to receive, pursuant to Section 3, a cash payment
as described in the Participants award agreement, taking
into account the Target Award and the Performance Formula, upon
the attainment of one or more specified Performance Goals,
subject to the terms and provisions of the award agreement and
the Plan.
(17) The term Performance Goals shall mean,
with respect to any Performance Cash Right, Performance Stock
Right,
performance-based
Restricted Stock or
performance-based
Restricted Stock Unit granted to a Participant who is a Covered
Executive, a performance measure that is based upon one or more
of the following objective business criteria established by the
Committee with respect to the Company
and/or any
Subsidiary, division, business unit or component thereof: asset
charge, asset turnover, return on sales, capacity utilization,
capital employed in the business, capital spending, cash flow,
cost structure improvements, complexity reductions, customer
loyalty, diversity, earnings growth, earnings per share,
economic value added, environmental health
and/or
safety, facilities and tooling spending, hours per component,
increase in customer base, inventory turnover, market price
appreciation, market share, net cash balance, net income, net
income margin, net operating cash flow, operating profit margin,
order to delivery time, plant capacity, process time, profits
before tax, quality, customer satisfaction, return on assets,
return on capital, return on equity, return on net operating
assets, return on sales, revenue growth, safety, sales margin,
sales volume, total stockholder return, production per employee,
warranty performance to budget, variable margin and working
capital. With respect to any Right granted to a Participant who
is not a Covered Executive, performance goals may be based on
one or more of the business criteria described above or any
other criteria based on individual, business unit, group or
Company performance selected by the Committee. The Performance
Goals may be expressed in absolute terms or relate to the
performance of other companies or to an index.
(18) The term Performance Formula shall mean a
formula to be applied in relation to the Performance Goals in
determining the amount of cash earned under a Performance Cash
Right granted pursuant to Section 3, the number of shares
of Stock earned under a Performance Stock Right granted pursuant
to Section 5,
performance-based
Restricted Stock granted pursuant to Section 6, or the
amount of cash or shares of Stock earned under
performance-based
Restricted Stock Units granted pursuant to Section 6, in
each case expressed as a percentage of the Target Award.
(19) The term Performance Period shall mean the
period of time for which performance with respect to one or more
Performance Goals with respect to any Performance Cash Right,
Performance Stock Right, Restricted Stock or Restricted Stock
Unit award is to be measured, with such period commencing not
earlier than 90 days prior to the date of grant of such
Right.
(20) The term Performance Stock Right shall
mean the right to receive, pursuant to Section 5 and
without payment to the Company, up to the number of shares of
Stock described in the Participants award agreement upon
the attainment of one or more specified Performance Goals,
subject to the terms and provisions of the award agreement and
the Plan.
(21) The term Person shall have the meaning
given in Section 3(a)(9) of the Exchange Act, as modified
and used in Sections 13(d) and 14(d) thereof, except that
such term shall not include (A) the Company or any of its
subsidiaries, (B) a trustee or other fiduciary holding
securities under an employee benefit plan of the Company or any
of its Affiliates, (C) an underwriter temporarily holding
securities pursuant to an offering of such securities, or
(D) a corporation owned, directly or indirectly, by the
stockholders of the Company in substantially the same
proportions as their ownership of Stock of the Company.
B-3
(22) The term Plan shall mean this
Visteon Corporation 2004 Incentive Plan (formerly known as
the Visteon Corporation 2000 Incentive Plan) as the same
may be amended and in effect from time to time.
(23) The term Plan Awards shall mean awards of
cash or grants of Performance Stock Rights, Restricted Stock,
Restricted Stock Units, Options, Stock Appreciation Rights and
various other rights with respect to shares of Stock.
(24) The term Restricted Stock means Stock
issued to a Participant pursuant to Section 6 that is
subject to forfeiture if one or more specified Performance Goals
or minimum periods of service are not attained.
(25) The term Restricted Stock Unit means an
award granted pursuant to Section 6 consisting of a unit
credited to a hypothetical account, valued based on the Fair
Market Value of Visteon Stock, and is subject to forfeiture if
one or more specified Performance Goals or minimum periods of
service are not attained.
(26) The term Right shall mean a Performance
Cash Right, Performance Stock Right, a Restricted Stock award,
or a Restricted Stock Unit, as required by the context.
(27) The term Stock Appreciation Right shall
mean the right to receive, without payment to the Company, an
amount of cash or Stock as determined in accordance with
Section 7, based on the amount by which the Fair Market
Value of a share of Stock on the relevant valuation date exceeds
the grant price.
(28) The term Subsidiary shall mean
(A) any corporation a majority of the voting stock of which
is owned directly or indirectly by the Company or (B) any
limited liability company a majority of the membership interest
of which is owned, directly or indirectly, by the Company.
(29) The term Stock shall mean shares of the
Companys common stock, par value $1.00 per share.
(30) The term Target Award shall mean the
amount of compensation to be earned by a Participant under a
Performance Cash Right or the number of shares of Stock, subject
to adjustment pursuant to Section 13, to be earned by a
Participant under a Performance Stock Right, if all of the
Performance Goals with respect to such Right are achieved.
Section 2.
ADMINISTRATION
(a) Committee. The Plan shall be
administered by the Organization & Compensation
Committee of the Board consisting of not less than two
(2) members of the Board who meet the outside
director requirements of Section 162(m) of the Code and the
non-employee
director requirements of
Rule 16b-3(b)(3)
of the Exchange Act, or by any other committee appointed by the
Board, provided the members of such committee meet such
requirements. The Committee shall administer the Plan and
perform such other functions as are assigned to it under the
Plan. The Committee is authorized, subject to the provisions of
the Plan, from time to time, to establish such rules and
regulations as it may deem appropriate for the proper
administration of the Plan, and to make such determinations
under, and such interpretations of, and to take such steps in
connection with, the Plan and the Plan Awards as it may deem
necessary or advisable, in each case in its sole discretion. The
Committees decisions and determinations under the Plan
need not be uniform and may be made selectively among
Participants, whether or not they are similarly situated. Any
authority granted to the Committee may also be exercised by the
Board, except to the extent that the grant or exercise of such
authority would cause any qualified performance based award to
cease to qualify for exemption under Section 162(m) of the
Code. To the extent that any permitted action taken by the Board
conflicts with any action taken by the Committee, the Board
action shall control.
(b) Delegation of Authority. The
Committee may delegate any or all of its powers and duties under
the Plan, including, but not limited to, its authority to make
awards under the Plan or to grant waivers pursuant to
Section 10, to one or more other committees (including a
committee consisting of two or more corporate officers) as it
shall appoint, pursuant to such conditions or limitations as the
Committee may establish; provided, however, that the
Committee shall not delegate its authority to (1) act on
matters affecting any Participant who is subject to the
reporting requirements of Section 16(a) of the Exchange
Act, or the liability provisions of Section 16(b) of the
Exchange Act (any such Participant being called a
Section 16 Person) or (2) amend or
modify the Plan pursuant to the provisions of
Section 16(b). To the extent of any such delegation, the
term Committee when used herein shall mean and
include any such delegate.
B-4
(c) Eligibility of Committee Members. No
person while a member of the Committee or any other committee of
the Board administering the Plan shall be eligible to hold or
receive a Plan Award.
Section 3.
PERFORMANCE CASH RIGHTS
(a) Grant of Performance Cash Rights. The
Committee, at any time and from time to time while the Plan is
in effect, may grant or authorize the granting of Performance
Cash Rights to such officers of the Company and any Subsidiary
and other Employees, whether or not members of the Board, as it
may select and in such amount as it shall designate, subject to
the provisions of this Section 3.
(b) Maximum Awards. The maximum amount
granted to a Covered Executive as a Final Award with respect to
all Performance Cash Rights granted during a calendar year shall
be $10 million.
(c) Terms and Provisions of Performance Cash
Rights. Prior to the grant of any Performance
Cash Right, the Committee shall determine the terms and
provisions of such Right, including, without limitation
(1) the Target Award; (2) one or more Performance
Goals to be used to measure performance under such Right, and
the Performance Formula to be applied against the Performance
Goals in determining the amount of compensation earned under
such Right as a percentage of the Target Award; (3) the
Performance Period, and (4) the effect of the
Participants termination of employment, death or
disability. Within 90 days of commencement of a Performance
Period, the Committee may establish a minimum threshold
objective for any Performance Goal for such Performance Period
which, if not met, would result in no Final Award being made to
any Participant with respect to such Performance Goal for such
Performance Period. During and after the Performance Period, but
prior to the Committees final determination of the
Participants Final Award as provided in subsection (d),
the Committee may adjust the Performance Goals, Performance
Formula and Target Award and otherwise modify the terms and
provisions of a Right granted to a Participant who is not a
Covered Executive, subject to the terms and conditions of the
Plan. Each Right shall be evidenced by an award agreement or
notification in such form as the Committee may determine.
(d) Final Awards. As soon as practicable
following the completion of the Performance Period relating to
any Performance Cash Right, but not later than 12 months
following such completion, the Committee shall determine the
extent to which the Performance Goals have been achieved and the
amount of compensation to be awarded as a Final Award to the
Participant who holds such Right. In making such determination,
the Committee shall apply the applicable Performance Formula for
the Participant for the Performance Period against the
accomplishment of the related Performance Goals. The Committee
may, in its sole discretion, reduce the amount of any Final
Award that otherwise would be awarded to any Participant for any
Performance Period. In addition, the Committee may, in its sole
discretion, increase the amount of any Final Award that
otherwise would be awarded to any Participant who is not a
Covered Executive. Any such determination shall take into
account (A) the extent to which the Performance Goals
provided in such Right were, in the Committees sole
opinion, achieved, (B) the individual performance of such
Participant during the related Performance Period and
(C) such other factors as the Committee may deem relevant,
including, without limitation, any change in circumstances or
unforeseen events, relating to the Company, the economy or
otherwise, since the date of grant of such Right. The Committee
shall notify such Participant of such Participants Final
Award as soon as practicable following such determination.
(e) Following the determination of each Final Award, unless
the Participant has elected to defer all or a portion of the
Final Award in accordance with the procedures set forth in the
Visteon Corporation Deferred Compensation Plan, the Final
Award will be payable to the Participant in cash.
B-5
Section 4.
STOCK AVAILABLE FOR PLAN AWARDS
(a) Stock Subject to Plan. The Stock that
may be issued under the Plan may be either authorized and
unissued or held in the treasury of the Company. The maximum
number of shares of Stock that may be issued with respect to
Plan Awards, subject to adjustment in accordance with the
provisions of Section 13, shall be 21,800,000.
Notwithstanding the foregoing, (1) the aggregate number of
shares that may be issued upon exercise of ISOs shall not exceed
10,280,000 shares, subject to adjustment in accordance with
the provisions of Section 13; (2) the maximum number
of shares subject to Options, with or without any related Stock
Appreciation Rights, or Stock Appreciation Rights (not related
to Options) that may be granted pursuant to Section 7 to
any Covered Executive during any calendar year prior to 2004
shall be 500,000, and for calendar years after 2003 shall be
1,000,000, subject to adjustment in accordance with the
provisions of Section 13; and (3) the maximum number
of shares of Stock that may be issued pursuant to such
Performance Stock Rights and
performance-based
Restricted Stock Awards when combined with the number of
performance-based
Restricted Stock Units granted pursuant to Section 6
(whether such Restricted Stock Units are settled in cash or in
Stock), to any Covered Executive during any calendar year prior
to 2004 shall be 500,000 shares, and for calendar years
after 2003 shall be 1 million shares
and/or
units, subject to adjustment in accordance with the provisions
of Section 13.
(b) Computation of Stock Available for Plan
Awards. For the purpose of computing the total
number of shares of Stock remaining available for Plan Awards at
any time while the Plan is in effect, and for the purpose of
determining the maximum number of shares of Stock that remain
available to be issued with respect to Performance Stock Rights,
Restricted Stock Awards, Restricted Stock Units, and Other
Stock-Based
Awards under clause (3) of subsection (a) there shall
be debited against the total number of shares determined to be
available pursuant to subsections (a) and (c) of this
Section 4, (1) the maximum number of shares of Stock
subject to issuance upon exercise of Options or Stock
Appreciation Rights granted under this Plan, (2) the
maximum number of shares of Stock issued or issuable under
Performance Stock Rights, Restricted Stock Awards and Restricted
Stock Units granted under this Plan, and (3) the number of
shares of Stock related to Other
Stock-Based
Awards granted under this Plan, as determined by the Committee
in each case as of the dates on which such Plan Awards were
granted, provided, however, that a Restricted Stock Unit or
Other
Stock-Based
Award that is or may be settled only in cash shall not be
counted against any of the share limits under this
Section 4, except as required by Section 162(m) of the
Code to preserve the status of an award as
performance-based
compensation as set forth under clause (4) of
subsection (a) above.
(c) Terminated, Expired or Forfeited Plan
Awards. The shares involved in the unexercised,
undistributed or unvested portion of any terminated, expired or
forfeited Plan Award shall be made available for further Plan
Awards. Any shares of Stock made available for Plan Awards
pursuant to this subsection (c) shall be in addition to the
shares available pursuant to subsection (a) of this
Section 4. Notwithstanding the foregoing, in the event any
Option or Stock Appreciation Right granted to a Covered
Executive is canceled, the number of shares of Stock subject to
such canceled Option or Stock Appreciation Right shall continue
to count against the individual limit specified in subsection
(a), in accordance with the requirements of Code
Section 162(m).
Section 5.
PERFORMANCE STOCK RIGHTS
(a) Grant of Performance Stock
Rights. The Committee, at any time and from time
to time while the Plan is in effect, may grant, or authorize the
granting of, Performance Stock Rights to such officers of the
Company and any Subsidiary, and other Employees, whether or not
members of the Board, as it may select and for such numbers of
shares as it shall designate, subject to the provisions of this
Section 5 and Section 4.
B-6
(b) Terms and Provisions of Performance Stock
Rights. Prior to the grant of any Performance
Stock Right, the Committee shall determine the terms and
provisions of each Right, including, without limitation
(1) the Target Award; (2) one or more Performance
Goals to be used to measure performance under such Right, and
the Performance Formula to be applied against the Performance
Goals in determining the number of shares of Stock earned under
such Right as a percentage of the Target Award; (3) the
Performance Period; (4) the period of time, if any, during
which the disposition of shares of Stock issuable under such
Right shall be restricted as provided in subsection (a) of
Section 11, provided, however, that the Committee
may establish restrictions applicable to any Right at the time
of or at any time prior to the granting of the related Final
Award rather than at the time of granting such Right; and
(5) the effect of the Participants termination of
employment, death or disability. Within 90 days of
commencement of a Performance Period, the Committee may
establish a minimum threshold objective for any Performance Goal
for such Performance Period which, if not met, would result in
no Final Award being made to any Participant with respect to
such Performance Goal for such Performance Period. During and
after the Performance Period, but prior to the Committees
final determination of the Participants Final Award as
provided in subsection (d), the Committee may adjust the
Performance Goals, Performance Formula and Target Award and
otherwise modify the terms and provisions of a Right granted to
a Participant who is not a Covered Executive, subject to the
terms and conditions of the Plan. Each Right shall be evidenced
by an award agreement or notification in such form as the
Committee may determine.
(c) Dividend Equivalents on Rights. If
the Committee shall determine, each Participant to whom a Right
is granted shall be entitled to receive payment of the same
amount of cash that such Participant would have received as cash
dividends if, on each record date during the Performance Period
relating to such Right, such Participant had been the holder of
record of a number of shares of Stock equal to 100% of the
related Target Award (as adjusted pursuant to Section 13).
Any such payment may be made at the same time as a dividend is
paid or may be deferred until the date that a Final Award is
determined, as determined by the Committee in its sole
discretion. Such cash payments are hereinafter called
dividend equivalents.
(1) As soon as practicable following the completion of the
Performance Period relating to any Performance Stock Right, but
not later than 12 months following such completion, the
Committee shall determine the extent to which the Participant
achieved the Performance Goals and the number of shares of Stock
to be awarded as a Final Award to the Participant who holds such
Right. Each Final Award shall represent only full shares of
Stock, and any fractional share that would otherwise result from
such Final Award calculation shall be disregarded. In making
such determination, the Committee shall apply the applicable
Performance Formula for the Participant for the Performance
Period against the accomplishment of the related Performance
Goals. The Committee may, in its sole discretion, reduce the
amount of any Final Award that otherwise would be awarded to any
Participant for any Performance Period. In addition, the
Committee may, in its sole discretion, increase the amount of
any Final Award that otherwise would be awarded to any
Participant who is not a Covered Executive. Any such
determination shall take into account (A) the extent to
which the Performance Goals provided in such Right was, in the
Committees sole opinion, achieved, (B) the individual
performance of such Participant during the related Performance
Period and (C) such other factors as the Committee may deem
relevant, including, without limitation, any change in
circumstances or unforeseen events, relating to the Company, the
economy or otherwise, since the date of grant of such Right. The
Committee shall notify such Participant of such
Participants Final Award as soon as practicable following
such determination.
B-7
(2) Following the determination of each Final Award, the
Company shall issue or cause to be issued certificates for the
number of shares of Stock representing such Final Award,
registered in the name of the Participant who received such
Final Award. Such Participant shall thereupon become the holder
of record of the number of shares of Stock evidenced by such
certificates, entitled to dividends, voting rights and other
rights of a holder thereof, subject to the terms and provisions
of the Plan, including, without limitation, the provisions of
this subsection (d) and Sections 10, 11 and 13. The
Committee may require that such certificates bear such
restrictive legend as the Committee may specify and be held by
the Company in escrow or otherwise pursuant to any form of
agreement or instrument that the Committee may specify. If the
Committee has determined that deferred dividend equivalents
shall be payable to a Participant with respect to any
Performance Stock Right pursuant to subsection (c) of this
Section 5, then concurrently with the issuance of such
certificates, the Company shall deliver to such Participant a
cash payment or additional shares of Stock in settlement of such
dividend equivalents. Notwithstanding the foregoing, the
Committee, in its sole discretion, may permit a Participant to
defer receipt of a Final Award and to instead receive stock
units under the Visteon Corporation Deferred Compensation
Plan that represent hypothetical shares of Stock of the Company,
or such other deemed investment made available by the Committee
for this purpose. Any such election, if permitted by the
Committee, must be made at such time and in such form as
prescribed by the Committee, and is subject to such other terms
and conditions as the Committee, in its sole discretion, may
prescribe.
(3) Notwithstanding the provisions of this
subsection (d) or any other provision of the Plan, the
Committee may specify that a Participants Final Award
shall not be represented by certificates for shares of Stock but
shall be represented by rights approximately equivalent (as
determined by the Committee) to the rights that such Participant
would have received if certificates for shares of Stock had been
issued in the name of such Participant in accordance with
subsection (d) (such rights being called Stock
Equivalents). Subject to the provisions of Section 13
and the other terms and provisions of the Plan, if the Committee
shall so determine, each Participant who holds Stock Equivalents
shall be entitled to receive the same amount of cash that such
Participant would have received as dividends if certificates for
shares of Stock had been issued in the name of such Participant
pursuant to subsection (d) covering the number of shares
equal to the number of shares to which such Stock Equivalents
relate. Notwithstanding any other provision of the Plan to the
contrary, the Stock Equivalents representing any Final Award
may, at the option of the Committee, be converted into an
equivalent number of shares of Stock or, upon the expiration of
any restriction period imposed on such Stock Equivalents, into
cash, under such circumstances and in such manner as the
Committee may determine.
Section 6.
RESTRICTED STOCK AND RESTRICTED STOCK UNITS
(a) Grant of Restricted Stock. The
Committee, at any time and from time to time while the Plan is
in effect, may grant, or authorize the granting of, Restricted
Stock to such officers of the Company and any Subsidiary, and
other Employees, whether or not members of the Board, as it may
select. In lieu of, or in addition to, such Restricted Stock,
the Committee may grant, or authorize the granting of, awards
denominated in the form of Restricted Stock Units to such
eligible Employees.
B-8
(b) Terms and Provisions of Restricted Stock and
Restricted Stock Units. Subject to the provisions
of the Plan, the Committee shall have the authority to determine
the time or times at which Restricted Stock or Restricted Stock
Units shall be granted and the number of shares of Restricted
Stock or the number of Restricted Stock Units to be granted
(subject to the provisions of Section 4). Prior to the
grant of any Restricted Stock or Restricted Stock Units, the
Committee shall determine such
time-based
or
performance-based
restrictions as the Committee shall deem appropriate, and all
other terms and conditions of such Restricted Stock and
Restricted Stock Units, including, without limitation
(1) the number of shares of Restricted Stock or Restricted
Stock Units to be issued; (2) in the case of
time-based
Restricted Stock or Restricted Stock Units, the minimum period
of service required for the Participant to receive a Final
Award; (3) in the case of
performance-based
Restricted Stock or
performance-based
Restricted Stock Units, one or more Performance Goals to be used
to measure performance with respect to such Restricted Stock or
Restricted Stock Units; (4) the Performance Period
applicable to any such
performance-based
award; (5) whether Final Awards pursuant to such Restricted
Stock Units shall be payable in Stock, cash or otherwise;
(6) the period of time, if any, during which the
disposition of the Restricted Stock or Final Award pursuant to a
Restricted Stock Unit is restricted as provided in
subsection (a) of Section 10, provided,
however, that the Committee may establish restrictions
applicable to Restricted Stock or Restricted Stock Units at the
time of or at any time prior to the granting of the related
Final Award rather than at the time of granting such Right; and
(7) the effect of the Participants termination of
employment, death or disability. Within 90 days of
commencement of a Performance Period, the Committee may
establish a minimum threshold objective for any Performance Goal
for such Performance Period which, if not met, would result in
no Final Award being made to any Participant with respect to
such Performance Goal for such Performance Period. During and
after the Performance Period, but prior to the Committees
final determination of the Participants Final Award as
provided in subsection (d), the Committee may adjust the
Performance Goals and otherwise modify the terms and provisions
of the Restricted Stock grant or Restricted Stock Unit to a
Participant who is not a Covered Executive, subject to the terms
and conditions of the Plan. Each grant of Restricted Stock or
Restricted Stock Units shall be evidenced by an award agreement
or notification in such form as the Committee may determine.
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(c) |
Dividend and Dividend Equivalents.
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(1) During any period that Restricted Stock has been issued
to the Participant and remains outstanding, the Participant
shall be entitled to receive all dividends and other
distributions paid with respect to the Restricted Stock. If any
such dividends or distributions are paid in Stock and such
distribution occurs when the restrictions applicable to such
shares are still in effect, such shares shall be subject to the
same restrictions as the Restricted Stock with respect to which
they were paid.
(2) If the committee shall determine, each Participant to
whom a Restricted Stock Unit is granted and remains outstanding
shall be entitled to receive payment of the same amount of cash
that such Participant would have received as cash dividends as
if, on each record date during the minimum period of service or
the Performance Period related to the Restricted Stock Unit,
such Participant had been the holder of record of a number of
shares of Stock equal to 100% of the Restricted Stock Units (as
adjusted pursuant to Section 13). Any such payment may be
made at the same time as a dividend is paid, or may be deferred
until the date that a Final Award is determined, as determined
by the Committee in its sole discretion. Such cash payments are
hereinafter called dividend equivalents.
(d) Voting Rights. Subject to the
restrictions established by the Committee pursuant to the Plan,
Participants shall be entitled to vote Restricted Shares granted
under this Section 6, unless and until such shares are
forfeited pursuant to subsection (e) below. Participants
shall have no voting rights with respect to Restricted Stock
Units.
B-9
(e) Final Awards. As soon as practicable
following the completion of the Performance Period relating to
any Restricted Stock or Restricted Stock Unit, but not later
than 12 months following such completion, the Committee
shall determine (1) the extent to which the Participant
achieved the minimum period of service, with respect to
time-based
awards, or the applicable Performance Goals, with respect to
performance-based
awards, (2) the number of shares of Restricted Stock to be
retained as a Final Award by the Participant who holds such
Restricted Stock, (3) the number of shares of Restricted
Stock to be forfeited by such Participant, (4) the number
of shares of Stock or amount of other compensation to be issued
as a Final Award to the Participant who holds Restricted Stock
Units, and (5) the number of Restricted Stock Units to be
forfeited by such Participant. Each Final Award shall represent
only full shares of Stock and any fractional share that would
otherwise result from such Final Award calculation shall be
forfeited. In making such determination, the Committee shall
apply the applicable minimum period of service or Performance
Goals that the Committee had established. The Committee may, in
its sole discretion, increase the amount of any Final Award that
otherwise would be awarded to any Participant who is not a
Covered Executive by determining that the Participant should be
allowed to retain some or all of the Restricted Stock that would
otherwise be forfeited, or should receive Stock or other
consideration for Restricted Stock Units that would otherwise be
forfeited, notwithstanding the fact that the minimum period of
service or Performance Goals were not satisfied in full. Any
such determination shall take into account (A) the extent
to which the Performance Goals that relate to such Restricted
Stock or Restricted Stock Units were, in the Committees
sole opinion, achieved, (B) the individual performance of
such Participant during the related period of service or
Performance Period and (C) such other factors as the
Committee may deem relevant, including, without limitation, any
change in circumstances or unforeseen events, relating to the
Company, the economy or otherwise, since the date of grant of
such Restricted Stock. The Committee shall notify such
Participant of such Participants Final Award as soon as
practicable following such determination.
(f) Election of Deferred Stock Units. The
Committee, in its sole discretion, may permit a Participant to
defer or otherwise exchange receipt of a Final Award relating to
Restricted Stock or Restricted Stock Units and to instead
receive stock units under the Visteon Corporation Deferred
Compensation Plan that represent hypothetical shares of Stock of
the Company, or such other deemed investment made available by
the Committee for this purpose. Any such election, if permitted
by the Committee, must be made at such time and in such form as
prescribed by the Committee. If the Committee so permits and a
Participant makes an appropriate election, the
Participants right to receive a benefit from the
Visteon Corporation Deferred Compensation Plan based on
such stock units is contingent upon attainment of the applicable
minimum period of service or Performance Goals and such other
terms and conditions as the Committee, in its sole discretion,
may prescribe.
Section 7.
OPTIONS AND STOCK APPRECIATION RIGHTS
(1) The Committee, at any time and from time to time while
the Plan is in effect, may authorize the granting of Options to
such officers of the Company and any Subsidiary and other
Employees, whether or not members of the Board, as it may
select, and for such numbers of shares as it shall designate,
subject to the provisions of this Section 7 and
Section 4. Each Option granted pursuant to the Plan shall
be designated at the time of grant as either an ISO or an NQO.
(2) The date on which an Option shall be granted shall be
the date of authorization of such grant or such later date as
may be determined by the Committee at the time such grant is
authorized. Any individual may hold more than one Option.
(b) Price. In the case of each Option
granted under the Plan the option price shall be the Fair Market
Value of Stock on the date of grant of such Option; provided,
however, that the Committee may in its discretion fix an
option price in excess of the Fair Market Value of Stock on such
date.
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(c) |
Grant of Stock Appreciation Rights.
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(1) The Committee, at any time and from time to time while
the Plan is in effect, may authorize the granting of Stock
Appreciation Rights to such officers of the Company and any
Subsidiary and other Employees, whether or not members of the
Board, as it may select, and for such numbers of shares as it
shall designate, subject to the provisions of this
Section 7 and Section 4. Each Stock Appreciation Right
may relate to all or a portion of a specific Option granted
under the Plan and may be granted concurrently with the Option
to which it relates or at any time prior to the exercise,
termination or expiration of such Option (a Tandem
SAR), or may be granted independently of any Option, as
determined by the Committee. If the Stock Appreciation Right is
granted independently of an Option, the grant price of such
right shall be the Fair Market Value of Stock on the date of
grant; provided, however, that the Committee may, in its
discretion, fix a grant price in excess of the Fair Market Value
of Stock on such grant date.
(2) Upon exercise of a Stock Appreciation Right, the
Participant shall be entitled to receive, without payment to the
Company, either (A) that number of shares of Stock
determined by dividing (i) the total number of shares of
Stock subject to the Stock Appreciation Right being exercised by
the Participant, multiplied by the amount by which the Fair
Market Value of a share of Stock on the day the right is
exercised exceeds the grant price (such amount being hereinafter
referred to as the Spread), by (ii) the Fair
Market Value of a share of Stock on the exercise date; or
(B) cash in an amount determined by multiplying
(i) the total number of shares of Stock subject to the
Stock Appreciation Right being exercised by the Participant, by
(ii) the amount of the Spread; or (C) a combination of
shares of Stock and cash, in amounts determined as set forth in
clauses (A) and (B) above, as determined by the
Committee in its sole discretion; provided, however,
that, in the case of a Tandem SAR, the total number of shares
which may be received upon exercise of a Stock Appreciation
Right for Stock shall not exceed the total number of shares
subject to the related Option or portion thereof, and the total
amount of cash which may be received upon exercise of a Stock
Appreciation Right for cash shall not exceed the Fair Market
Value on the date of exercise of the total number of shares
subject to the related Option or portion thereof.
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(d) |
Terms and Conditions.
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(1) Each Option and Stock Appreciation Right granted under
the Plan shall be exercisable on such date or dates, during such
period, for such number of shares and subject to such further
conditions as shall be determined pursuant to the provisions of
the award agreement with respect to such Option and Stock
Appreciation Right; provided, however, that a Tandem SAR
shall not be exercisable prior to or later than the time the
related Option could be exercised; and provided, further,
that in any event no Option or Stock Appreciation Right granted
prior to 2004 shall be exercised beyond ten years from the date
of grant, no Option or Stock Appreciation Right granted after
2003 but prior to 2006 shall be exercised beyond five years from
the date of grant, and no Option or Stock Appreciation Right
granted after 2005 shall be exercised beyond seven years from
the date of grant.
(2) The Committee may impose such conditions as it may deem
appropriate upon the exercise of an Option or a Stock
Appreciation Right, including, without limitation, a condition
that the Stock Appreciation Right may be exercised only in
accordance with rules and regulations adopted by the Committee
from time to time.
(3) With respect to Options issued with Tandem SARs, the
right of a Participant to exercise the Tandem SAR shall be
cancelled if and to the extent the related Option is exercised,
and the right of a Participant to exercise an Option shall be
cancelled if and to the extent that shares covered by such
Option are used to calculate shares or cash received upon
exercise of the Tandem SAR.
(4) If any fractional share of Stock would otherwise be
payable to a Participant upon the exercise of an Option or Stock
Appreciation Right, the Participant shall be paid a cash amount
equal to the same fraction of the Fair Market Value of the Stock
on the date of exercise.
(e) Award Agreement. Each Option and
Stock Appreciation Right shall be evidenced by an award
agreement or notification in such form and containing such
provisions not inconsistent with the provisions of the Plan as
the Committee from time to time shall approve.
B-11
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(f) |
Payment for Option Shares.
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(1) Payment for shares of Stock purchased upon exercise of
an Option granted hereunder shall be made, either in full or, if
the Committee shall so determine and at the election of the
Participant, in installments, in such manner as is provided in
the applicable award agreement.
(2) Subject to applicable law
and/or
accounting expense implications, the consideration to be paid
for shares of Stock purchased upon exercise of an Option granted
hereunder shall be determined by the Committee, which, in
addition to any other types of consideration the Committee may
so determine, may include the acceptance of the following:
(i) cash, (ii) the delivery or surrender of shares of
Stock (including the withholding of Stock otherwise deliverable
upon exercise of the Option), (iii) a cashless
sale and remittance procedure executed through a broker-dealer,
or (iv) any combination of the foregoing methods of
payment. Any such shares of Stock so delivered or surrendered
shall be valued at their Fair Market Value on the date of such
exercise. The Committee shall determine whether and if so the
extent to which actual delivery of share certificates to the
Company shall be required.
Section 8.
STOCK AND OTHER STOCK-BASED AWARDS
(a) Grants of Other Stock-Based
Awards. The Committee, at any time and from time
to time while the Plan is in effect, may grant Other Stock-Based
Awards to such officers of the Company and its Subsidiaries and
other Employees, whether or not members of the Board, as it may
select. Such Plan Awards pursuant to which Stock is or may in
the future be acquired, or Plan Awards valued or determined in
whole or part by reference to, or otherwise based on, Stock, may
include, but are not limited to, awards of restricted Stock (in
addition to or in lieu of Restricted Stock under
Section 6) or Plan Awards denominated in the form of
stock units (in addition to or in lieu of Restricted
Stock Units under Section 6), grants of so-called
phantom stock and options containing terms or
provisions differing in whole or in part from Options granted
pursuant to Section 7. Other Stock-Based Awards may be
granted either alone, in addition to, in tandem with or as an
alternative to any other kind of Plan Award, grant or benefit
granted under the Plan or under any other employee plan of the
Company, including a plan of any acquired entity.
(b) Terms and Conditions. Subject to the
provisions of the Plan, the Committee shall have the authority
to determine the time or times at which Other Stock-Based Awards
shall be made, the number of shares of Stock or stock units and
the like to be granted or covered pursuant to such Plan Awards
(subject to the provisions of Section 4) and all other
terms and conditions of such Plan Awards, including, but not
limited to, whether such Plan Awards shall be payable or paid in
cash, Stock or otherwise.
(c) Consideration for Other Stock-Based
Awards. In the discretion of the Committee, any
Other Stock-Based Award may be granted as a Stock bonus for no
consideration other than services rendered.
Section 9.
CASH AWARDS TO EMPLOYEES OF FOREIGN SUBSIDIARIES OR BRANCHES OR
JOINT VENTURES
In order to facilitate the granting of Plan Awards to
Participants who are foreign nationals or who are employed
outside of the United States of America, the Committee may
provide for such special terms and conditions, including without
limitation substitutes for Plan Awards, as the Committee may
consider necessary or appropriate to accommodate differences in
local law, tax policy or custom. Such substitutes for Plan
Awards may include a requirement that the Participant receive
cash, in such amount as the Committee may determine in its sole
discretion, in lieu of any Plan Award or share of Stock that
would otherwise have been granted to or delivered to such
Participant under the Plan. The Committee may approve any
supplements to, or amendments, restatements or alternative
versions of the Plan as it may consider necessary or appropriate
for purposes of this Section 9 without thereby affecting
the terms of the Plan as in effect for any other purpose, and
the Secretary or other appropriate officer of the Company may
certify any such documents as having been approved and adopted
pursuant to properly delegated authority; provided,
however, that no such supplements, amendments, restatements
or alternative versions shall include any provision that is
inconsistent with the terms of the Plan as then in effect.
Participants subject to the laws of a foreign jurisdiction may
request copies of, or the right to view, any materials that are
required to be provided by the Company pursuant to the laws of
such jurisdiction.
B-12
Section 10.
PAYMENT OF PLAN AWARDS AND CONDITIONS THEREON
(a) Effect of Competitive
Activity. Anything contained in the Plan to the
contrary notwithstanding, if the employment of any Participant
shall terminate, for any reason other than death, while any Plan
Award granted to such Participant is outstanding hereunder, and
such Participant has not yet received the Stock or cash covered
by such Plan Award or otherwise received the full benefit of
such Plan Award, such Participant, if otherwise entitled
thereto, shall receive such Stock, cash or benefit only if,
during the entire period from the date of such
Participants termination to the date of such receipt, such
Participant shall have (1) made himself or herself
available, upon request, at reasonable times and upon a
reasonable basis, to consult with, supply information to and
otherwise cooperate with the Company or any Subsidiary with
respect to any matter that shall have been handled by him or her
or under his or her supervision while he or she was in the
employ of the Company or of any Subsidiary, and
(2) refrained from engaging in any activity that is
directly or indirectly in competition with any activity of the
Company or any Subsidiary.
(b) Nonfulfillment of Competitive Activity Conditions:
Waivers Under the Plan. In the event of a Participants
nonfulfillment of any condition set forth in subsection (a)
of this Section 10, such Participants rights under
any Plan Award shall be forfeited and cancelled forthwith;
provided, however, that the nonfulfillment of such
condition may at any time (whether before, at the time of or
subsequent to termination of employment) be waived in the
following manner:
(1) with respect to any such Participant who at any time
shall have been a Section 16 Person, such waiver may
be granted by the Committee upon its determination that in its
sole judgment there shall not have been and will not be any
substantial adverse effect upon the Company or any Subsidiary by
reason of the nonfulfillment of such condition; and
(2) with respect to any other such Participant, such waiver
may be granted by the Committee (or any delegate thereof) upon
its determination that in its sole judgment there shall not have
been and will not be any such substantial adverse effect.
(c) Effect of Detrimental
Conduct. Anything contained in the Plan to the
contrary notwithstanding, all rights of a Participant under any
Plan Award shall cease on and as of the date on which it has
been determined by the Committee that such Participant at any
time (whether before or subsequent to termination of such
Participants employment) acted in a manner detrimental to
the best interests of the Company or any Subsidiary.
(d) Tax and Other Withholding. Prior to
any distribution of cash, Stock or Other Stock-Based Awards
(including payments under Section 5(c)) to any Participant,
appropriate arrangements (consistent with the Plan and any rules
adopted hereunder) shall be made for the payment of any taxes
and other amounts required to be withheld by federal, state or
local law.
(e) Substitution. The Committee, in its
sole discretion, may substitute a Plan Award (except ISOs) for
another Plan Award or Plan Awards of the same or different type;
provided, however, that the Committee shall not, without
shareholder approval, substitute Options or any other Plan Award
for outstanding Options with a higher price than the substitute
Option or other Plan Award.
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Section 11.
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NON-TRANSFERABILITY
OF PLAN AWARDS; RESTRICTIONS ON DISPOSITION AND EXERCISE OF PLAN
AWARDS
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(a) Restrictions on Transfer of Rights or Final
Awards. No Performance Cash Right, Performance
Stock Right, Restricted Stock Unit or, until the expiration of
any restriction period imposed by the Committee, no shares of
Stock acquired under the Plan, shall be transferred, pledged,
assigned or otherwise disposed of by a Participant, except as
permitted by the Plan, without the consent of the Committee,
otherwise than by will or the laws of descent and distribution;
provided, however, that the Committee may permit, on such
terms as it may deem appropriate, use of Stock included in any
Final Award as partial or full payment upon exercise of an
Option under the Plan or a stock option under any other stock
option plan of the Company prior to the expiration of any
restriction period relating to such Final Award.
B-13
(b) Restrictions on Transfer of Options or Stock
Appreciation Rights. Unless the Committee
determines otherwise, no Option or Stock Appreciation Right
shall be transferable by a Participant otherwise than by will or
the laws of descent and distribution, and during the lifetime of
a Participant the Option or Stock Appreciation Right shall be
exercisable only by such Participant or such Participants
guardian or legal representative; provided, however, that no
Option or Stock Appreciation Right shall be transferred for
consideration.
(c) Restrictions on Transfer of Certain Other
Stock-Based Awards. Unless the Committee
determines otherwise, no Other Stock-Based Award shall be
transferable by a Participant otherwise than by will or the laws
of descent and distribution, and during the lifetime of a
Participant any such Other Stock-Based Award shall be
exercisable only by such Participant or such Participants
guardian or legal representative.
(d) Attachment and Levy. No Plan Award
shall be subject, in whole or in part, to attachment, execution
or levy of any kind, and any purported transfer in violation
hereof shall be null and void. Without limiting the generality
of the foregoing, no domestic relations order purporting to
authorize a transfer of a Plan Award, or to grant to any person
other than the Participant the authority to exercise or
otherwise act with respect to a Plan Award, shall be recognized
as valid.
Section 12.
DESIGNATION OF BENEFICIARIES
Anything contained in the Plan to the contrary notwithstanding,
a Participant may file with the Company a written designation of
a beneficiary or beneficiaries under the Plan, subject to such
limitations as to the classes and number of beneficiaries and
contingent beneficiaries and such other limitations as the
Committee from time to time may prescribe. A Participant may
from time to time revoke or change any such designation of
beneficiary. If a Participant designates his spouse as a
Beneficiary, such designation automatically shall become null
and void on the date of the Participants divorce or legal
separation from such spouse. Any designation of a beneficiary
under the Plan shall be controlling over any other disposition,
testamentary or otherwise; provided, however, that if the
Committee shall be in doubt as to the entitlement of any such
beneficiary to receive any Right, Final Award, Restricted Stock,
Restricted Stock Unit, Option, Stock Appreciation Right, or
Other Stock-Based Award, or if applicable law requires the
Company to do so, the Committee may recognize only the legal
representative of such Participant, in which case the Company,
the Committee and the members thereof shall not be under any
further liability to anyone. In the event of the death of any
Participant, the term Participant as used in the
Plan shall thereafter be deemed to refer to the beneficiary
designated pursuant to this Section 12 or, if no such
designation is in effect, the executor or administrator of the
estate of such Participant, unless the context otherwise
requires.
Section 13.
MERGER, CONSOLIDATION, STOCK DIVIDENDS, ETC.
(a) Adjustments. In the event of any
merger, consolidation, reorganization, stock split, stock
dividend or other event affecting Stock, an appropriate
adjustment shall be made in the total number of shares available
for Plan Awards and in all other provisions of the Plan that
include a reference to a number of shares or units, and in the
numbers of shares or units covered by, and other terms and
provisions (including but not limited to the grant or exercise
price of any Plan Award) of outstanding Plan Awards.
(b) Committee Determinations. The
foregoing adjustments and the manner of application of the
foregoing provisions shall be determined by the Committee in its
sole discretion. Any such adjustment may provide for the
elimination of any fractional share which might otherwise become
subject to a Plan Award.
Section 14.
ACCELERATION OF PAYMENT OR MODIFICATION OF PLAN AWARDS
(a) Acceleration and Modification. The
Committee, in the event of the death of a Participant or in any
other circumstance, may accelerate distribution of any Plan
Award in its entirety or in a reduced amount, in cash or in
Stock, or modify any Plan Award, in each case on such basis and
in such manner as the Committee may determine in its sole
discretion.
B-14
(b) Change in Control. Notwithstanding
any other provision of the Plan, unless the Committee determines
otherwise at the time of grant, upon the occurrence of a Change
in Control, (1) any Plan Awards outstanding as of the date
of such Change in Control that relate to Performance Periods
that have been completed as of the date of the Change in
Control, but that have not yet been paid, shall be paid in
accordance with the terms of such Plan Awards, (2) any Plan
Awards outstanding as of the date of such Change in Control that
relate to Performance Periods that have not been completed as of
the date of the Change in Control, and that are not then vested,
shall become fully vested if vesting is based solely upon the
length of the employment relationship as opposed to the
satisfaction of one or more Performance Goals, and (3) any
other Plan Awards outstanding as of the date of such Change in
Control that relate to Performance Periods that have not been
completed as of the date of the Change in Control, and that are
not then vested, shall be treated as vested and earned pro rata,
as if the Performance Goals for the Target Award associated with
a Performance Cash Right or a Performance Stock Right or the
Performance Goals with respect to Restricted Stock, Restricted
Stock Units or Other Stock Based Awards are attained as of the
effective date of the Change in Control, by taking the product
of (A) the Target Award (in the case of a Performance Cash
Right or a Performance Stock Right) or the number of shares of
Restricted Stock, Restricted Stock Units or Other Stock Based
Awards granted to the Participant, and (B) a fraction, the
numerator of which is the number of full or partial months that
have elapsed from the beginning of the Performance Period to the
date of the Change in Control and the denominator of which is
the total number of months in the original Performance Period;
provided, however, that any such Plan Award shall be
immediately vested and payable to the Participant to the extent
of the foregoing formula, and shall be free of all restrictions
and conditions that would otherwise apply to such Plan Award.
The foregoing provisions are subject to the terms of any
employment contract governing the employment of a Participant to
the extent that such contract provides greater rights to the
Participant in the event of a Change in Control.
B-15
(c) Maximum Payment Limitation. If any
portion of the payments or benefits described in this Plan or
under any other agreement with or plan of the Company (in the
aggregate, Total Payments), would constitute an
excess parachute payment, then the Total Payments to
be made to the Participant shall be reduced such that the value
of the aggregate Total Payments that the Participant is entitled
to receive shall be one dollar ($1) less than the maximum amount
which the Participant may receive without becoming subject to
the tax imposed by Section 4999 of the Code or which the
Company may pay without loss of deduction under
Section 280G(a) of the Code; provided that this Section
shall not apply in the case of a Participant who has in effect a
valid employment contract providing that the Total Payments to
the Participant shall be determined without regard to the
maximum amount allowable under Section 280G of the Code.
The terms excess parachute payment and
parachute payment shall have the meanings assigned
to them in Section 280G of the Code, and such
parachute payments shall be valued as provided
therein. Present value shall be calculated in accordance with
Section 280G(d)(4) of the Code. Within forty (40) days
following delivery of notice by the Company to the Participant
of its belief that there is a payment or benefit due the
Participant which will result in an excess parachute payment as
defined in Section 280G of the Code, the Participant and
the Company, at the Companys expense, shall obtain the
opinion (which need not be unqualified) of nationally recognized
tax counsel selected by the Companys independent auditors
and acceptable to the Participant in his sole discretion (which
may be regular outside counsel to the Company), which opinion
sets forth (A) the amount of the Base Period Income,
(B) the amount and present value of Total Payments and
(C) the amount and present value of any excess parachute
payments determined without regard to the limitations of this
Section. As used in this Section, the term Base Period
Income means an amount equal to the Participants
annualized includible compensation for the base
period as defined in Section 280G(d)(1) of the Code.
For purposes of such opinion, the value of any noncash benefits
or any deferred payment or benefit shall be determined by the
Companys independent auditors in accordance with the
principles of Sections 280G(d)(3) and (4) of the Code,
which determination shall be evidenced in a certificate of such
auditors addressed to the Company and the Participant. Such
opinion shall be addressed to the Company and the Participant
and shall be binding upon the Company and the Participant. If
such opinion determines that there would be an excess parachute
payment, the payments hereunder that are includible in Total
Payments or any other payment or benefit determined by such
counsel to be includible in Total Payments shall be reduced or
eliminated as specified by the Participant in writing delivered
to the Company within thirty days of his receipt of such opinion
or, if the Participant fails to so notify the Company, then as
the Company shall reasonably determine, so that under the bases
of calculations set forth in such opinion there will be no
excess parachute payment. If such legal counsel so requests in
connection with the opinion required by this Section, the
Participant and the Company shall obtain, at the Companys
expense, and the legal counsel may rely on in providing the
opinion, the advice of a firm of recognized executive
compensation consultants as to the reasonableness of any item of
compensation to be received by the Participant. If the
provisions of Sections 280G and 4999 of the Code (or any
successor provisions) are repealed without succession, then this
Section shall be of no further force or effect.
Section 15.
RIGHTS AS A STOCKHOLDER
Except with respect to shares of Restricted Stock, a Participant
shall not have any rights as a stockholder with respect to any
share covered by any Plan Award until such Participant shall
have become the holder of record of such share.
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Section 16.
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TERM,
AMENDMENT, MODIFICATION AND TERMINATION OF THE PLAN AND
AGREEMENTS
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(a) Term. Unless terminated earlier
pursuant to subsection (b), the Plan shall terminate on
May 11, 2014.
B-16
(b) Amendment, Modification and Termination of
Plan. The Board may, from time to time, amend or
modify the Plan or any outstanding Plan Award, including without
limitation, to authorize the Committee to make Plan Awards
payable in other securities or other forms of property of a kind
to be determined by the Committee, and such other amendments as
may be necessary or desirable to implement such Plan Awards, or
may terminate the Plan or any provision thereof; provided,
however, that no such action of the Board, without approval
of the stockholders, may (1) increase the total number of
shares of Stock with respect to which Plan Awards may be granted
under the Plan or the individual limits specified in
Section 4(a), (2) increase the total amount that may
be paid to an individual with respect to a Performance Cash
Award, as specified in Section 3(b), (3) extend the
term of the Plan as set forth in paragraph (a) of this
Section 16, (4) permit any person while a member of
the Committee or any other committee of the Board administering
the Plan to be eligible to receive or hold a Plan Award, or
(5) permit the Company to decrease the grant price of any
outstanding Option or Stock Appreciation Right.
(c) Limitation and Survival. No amendment
to or termination of the Plan or any provision hereof, and no
amendment or cancellation of any outstanding Plan Award, by the
Board or the stockholders of the Company, shall, without the
written consent of the affected Participant, adversely affect
any outstanding Plan Award. The Committees authority to
act with respect to any outstanding Plan Award shall survive
termination of the Plan.
(d) Amendments for Changes in
Law. Notwithstanding the foregoing provisions,
the Board shall have the authority to amend outstanding Plan
Awards and the Plan to take into account changes in law and tax
and accounting rules as well as other developments, and to grant
Plan Awards that qualify for beneficial treatment under such
rules, without stockholder approval.
Section 17.
INDEMNIFICATION AND EXCULPATION
(a) Indemnification. Each person who is
or shall have been a member of the Board, the Committee, or of
any other committee of the Board administering the Plan or of
any committee appointed by the foregoing committees, shall be
indemnified and held harmless by the Company against and from
any and all loss, cost, liability or expense that may be imposed
upon or reasonably incurred by such person in connection with or
resulting from any claim, action, suit or proceeding to which
such person may be or become a party or in which such person may
be or become involved by reason of any action taken or failure
to act under the Plan and against and from any and all amounts
paid by such person in settlement thereof (with the
Companys written approval) or paid by such person in
satisfaction of a judgment in any such action, suit or
proceeding, except a judgment in favor of the Company based upon
a finding of such persons lack of good faith; subject,
however, to the condition that, upon the institution of any
claim, action, suit or proceeding against such person, such
person shall in writing give the Company an opportunity, at its
own expense, to handle and defend the same before such person
undertakes to handle and defend it on such persons behalf.
The foregoing right of indemnification shall not be exclusive of
any other right to which such person may be entitled as a matter
of law or otherwise, or any power that the Company may have to
indemnify or hold such person harmless.
(b) Exculpation. Each member of the
Board, the Committee, or of any other committee of the Board
administering the Plan or any committee appointed by the
foregoing committees, and each officer and employee of the
Company, shall be fully justified in relying or acting in good
faith upon any information furnished in connection with the
administration of the Plan by any appropriate person or persons
other than such person. In no event shall any person who is or
shall have been a member of the Board, the Committee, or of any
other committee of the Board administering the Plan or of any
committee appointed by the foregoing committees, or an officer
or employee of the Company, be held liable for any determination
made or other action taken or any omission to act in reliance
upon any such information, or for any action (including the
furnishing of information) taken or any failure to act, if in
good faith.
Section 18.
EXPENSES OF PLAN
The entire expense of offering and administering the Plan shall
be borne by the Company and its participating Subsidiaries;
provided, that the costs and expenses associated with the
redemption or exercise of any Plan Award, including but not
limited to commissions charged by any agent of the Company, may
be charged to the Participants.
B-17
Section 19.
FINALITY OF DETERMINATIONS
Each determination, interpretation, or other action made or
taken pursuant to the provisions of the Plan by the Board, the
Committee or any committee of the Board administering the Plan
or any committee appointed by the foregoing committees, shall be
final and shall be binding and conclusive for all purposes and
upon all persons, including, but without limitation thereto, the
Company, the stockholders, the Committee and each of the members
thereof, and the directors, officers, and employees of the
Company and its Subsidiaries, the Participants, and their
respective successors in interest.
Section 20.
NO RIGHTS TO CONTINUED EMPLOYMENT OR TO PLAN AWARD
(a) No Right to Employment. Nothing
contained in this Plan, or in any booklet or document describing
or referring to the Plan, shall be deemed to confer on any
Participant the right to continue as an Employee or director of
the Company or Subsidiary, whether for the duration of any
Performance Period, the duration of any vesting period under a
Plan Award, or otherwise, or affect the right of the Company or
Subsidiary to terminate the employment of any Participant for
any reason.
(b) No Right to Award. No Employee or
other person shall have any claim or right to be granted a Plan
Award under the Plan. Having received an Award under the Plan
shall not give a Participant or any other person any right to
receive any other Plan Award under the Plan. A Participant shall
have no rights in any Plan Award, except as set forth herein and
in the applicable award grant.
Section 21.
GOVERNING LAW AND CONSTRUCTION
The Plan and all actions taken hereunder shall be governed by,
and the Plan shall be construed in accordance with, the laws of
the State of Delaware without regard to the principle of
conflict of laws. Titles and headings to Sections are for
purposes of reference only, and shall in no way limit, define or
otherwise affect the meaning or interpretation of the Plan.
Section 22.
SECURITIES AND STOCK EXCHANGE REQUIREMENTS
(a) Restrictions on
Resale. Notwithstanding any other provision of
the Plan, no person who acquires Stock pursuant to the Plan may,
during any period of time that such person is an affiliate of
the Company (within the meaning of the rules and regulations of
the Securities Exchange Commission) sell or otherwise transfer
such Stock, unless such offer and sale or transfer is made
(1) pursuant to an effective registration statement under
the Securities Act of 1933 (1933 Act), which is
current and includes the Stock to be sold, or (2) pursuant
to an appropriate exemption from the registration requirements
of the 1933 Act, such as that set forth in Rule 144
promulgated pursuant thereto.
(b) Registration, Listing and Qualification of Shares of
Common Stock. Notwithstanding any other provision of the
Plan, if at any time the Committee shall determine that the
registration, listing or qualification of the Stock covered by a
Plan Award upon any securities exchange or under any foreign,
federal, state or local law or practice, or the consent or
approval of any governmental regulatory body, is necessary or
desirable as a condition of, or in connection with, the granting
of such Plan Award or the purchase or receipt of Stock in
connection therewith, no Stock may be purchased, delivered or
received pursuant to such Plan Award unless and until such
registration, listing, qualification, consent or approval shall
have been effected or obtained free of any condition not
acceptable to the Committee. Any person receiving or purchasing
Stock pursuant to a Plan Award shall make such representations
and agreements and furnish such information as the Committee may
request to assure compliance with the foregoing or any other
applicable legal requirements. The Company shall not be required
to issue or deliver any certificate or certificates for Stock
under the Plan prior to the Committees determination that
all related requirements have been fulfilled. The Company shall
in no event be obligated to register any securities pursuant to
the 1933 Act or applicable state or foreign law or to take
any other action in order to cause the issuance and delivery of
such certificates to comply with any such law, regulation, or
requirement.
B-18
APPENDIX C
DIRECTIONS TO HOTEL DU PONT
From
Philadelphia on I-95 South
1. Take I-95 South through Chester to Wilmington.
2. Follow I-95 South to Delaware Exit 7A marked 52
South Delaware Avenue.
3. Follow exit road (11th Street) to intersection with
Delaware Avenue marked 52 South, Business District.
4. At the Delaware intersection, bear left, continuing on
11th Street.
5. Follow 11th Street through four traffic lights.
Hotel du Pont is on the right. Valet Parking is available at
Hotel entrance. For self-parking, turn left on Orange Street,
Car Park is on left.
From
Baltimore on I-95 North
1. Follow I-95 North to Wilmington, take Exit 7 marked
Route 52, Delaware Ave.
2. From right lane, take Exit 7 onto Adams Street.
3. At the third traffic light on Adams Street, turn right.
Follow sign marked 52 South, Business District.
4. At the intersection of Delaware Avenue, bear left,
continuing on 11th Street.
5. Follow 11th Street through four traffic lights.
Hotel du Pont is on the right. Valet Parking is available at
Hotel entrance. For self-parking, turn left on Orange Street,
Car Park is on left.
C-1
This Proxy Statement is printed entirely on recycled and
recyclable paper. Soy ink, rather than petroleum-based ink, is
used.
VISTEON CORPORATION
ONE VILLAGE CENTER DRIVE
VAN BUREN TOWNSHIP, MI 48111
If you are a registered stockholder, there are three
ways to vote your shares before the meeting:
VOTE BY INTERNET - www.proxyvote.com
Use the Internet to transmit your voting instructions
and for electronic delivery of information up until
11:59 P.M. Eastern Time on May 13, 2008. Have your
proxy card in hand when you access the web site and
follow the instructions to obtain your records and to
create an electronic voting instruction form.
ELECTRONIC DELIVERY OF FUTURE STOCKHOLDER COMMUNICATIONS
If you would like to reduce the costs incurred by
Visteon Corporation in mailing proxy materials, you can
consent to receiving all future proxy statements, proxy
cards and annual reports electronically via e-mail or
the Internet. To sign up for electronic delivery,
please follow the instructions above to vote using the
Internet and, when prompted, indicate that you agree to
receive or access stockholder communications
electronically in future years.
VOTE BY PHONE - 1-800-690-6903
Use any touch-tone telephone to transmit your voting
instructions up until 11:59 P.M. Eastern Time on May
13, 2008. Have your proxy card in hand when you call
and then follow the instructions.
VOTE BY MAIL
Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or
return it to Visteon Corporation, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.
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TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
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VISTN1
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KEEP THIS PORTION FOR YOUR RECORDS |
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DETACH AND RETURN THIS PORTION ONLY |
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
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VISTEON CORPORATION |
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For
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Withhold
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For All
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To withhold authority to vote for any individual |
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All
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All
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Except
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nominee(s), mark For All Except and write the |
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Vote on Directors |
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number(s) of the nominee(s) on the line below. |
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1. |
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Elect eight directors to the Board of Directors. Nominees:
01) William H. Gray, III, 02)Steven K. Hamp,
03) Patricia L. Higgins, 04)Michael F. Johnston,
05) Karl J. Krapek, 06) Alex J. Mandl,07) Richard J.
Taggart and 08) James D. Thornton.
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Vote on Proposals |
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For
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Against
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Abstain
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2. |
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Ratify the appointment of PricewaterhouseCoopers LLP as Visteons independent registered public accounting firm for fiscal year 2008. |
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Approve amendments to Visteons 2004 Incentive Plan. |
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If presented, consideration of a stockholder proposal regarding the ability of a stockholder to call special meetings. |
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Signature [PLEASE SIGN WITHIN BOX] |
Date |
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Signature (Joint Owners) |
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VISTEON CORPORATION
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
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DATE:
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WEDNESDAY, MAY 14, 2008 |
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11:00 AM EASTERN DAYLIGHT TIME |
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LOCATION:
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HOTEL DU PONT |
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11th & MARKET STREETS
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WILMINGTON, DELAWARE USA |
We invite you to attend the 2008 Annual Meeting of Stockholders at the Hotel du Pont. At this
meeting, you and the other stockholders will be able to vote on the election of directors,
ratification of the Companys independent registered public accounting firm, amendments to the
Companys 2004 Incentive Plan, and a shareholder proposal, together with any other business that
may properly come before the meeting. You may vote on these proposals in person or by proxy. If you
cannot attend the meeting, we urge you to vote by proxy, so that your shares will be represented
and voted at the meeting in accordance with your instructions. See the attached Proxy Statement for
details on voting by proxy.
Important Notice Regarding Internet Availability of Proxy Materials for the Annual Meeting: The
Notice of Annual Meeting and Proxy Statement, electronic proxy card, Annual Report to Stockholders
and related materials are available at www.proxyvote.com.
VISTEON CORPORATION
Proxy
solicited on behalf of the Board of Directors
for the Annual Meeting of Stockholders
The stockholder hereby appoints William G. Quigley III and Heidi A. Sepanik, or either of them, as
proxies with power of substitution, to represent and to vote, as designated on the reverse side of
this ballot, all of the shares of Common Stock of Visteon Corporation that the stockholder is
entitled to vote at the Annual Meeting of Stockholders to be held at 11:00 a.m. Eastern Time on May
14, 2008, at the Hotel Du Pont, and any adjournment or postponement thereof.