Filed by the
Registrant ☒ Filed by a Party other than
the Registrant ☐
You are cordially invited to attend the
Annual Meeting of Shareholders of Energizer Holdings, Inc., to be held at 8:00 a.m. Central Time on Monday, January 30, 2017, at Energizer World Headquarters, 533 Maryville University Drive, St. Louis, Missouri 63141.
In connection with the Annual Meeting, we have prepared a Notice of Annual Meeting of Shareholders, a Proxy Statement, and our 2016 Annual Report. On or about
December 13, 2016, we began mailing to our shareholders these materials or a Notice of Availability of Proxy Materials containing instructions on how to access these materials online.
We encourage you to read the Proxy Statement and vote your shares. You may vote over the Internet, as well as by telephone, or, if you received or requested to receive
printed proxy materials, by signing, dating and returning the proxy card enclosed with the proxy materials as soon as possible in the postage-paid envelope provided. If you plan to attend the Annual Meeting, please bring the 2017 Annual Meeting
Admission Ticket and proof of identification (such as a drivers license or other photo identification).
ALAN R. HOSKINS
ITEM 1. ELECTION OF DIRECTORS
Our Board of Directors currently consists of ten members and is divided into three classes, with each class consisting of three members other than the class up for
re-election at the 2019 Annual Meeting, which has four members. The terms of service of the classes expire at successive annual meetings. Having reached the Board retirement age, John R. Roberts will not stand for re-election at the 2017 Annual
Meeting.
Our Board has approved a proposal for shareholder approval at the 2017 Annual Meeting to amend and restate the Amended and Restated Articles of
Incorporation of the Company in order to provide for the staged declassification of our Board of Directors. For more information regarding this proposal, see
Item 4. Proposal to Amend and Restate the Companys Amended and Restated
Articles of Incorporation to Provide for the Declassification of the Board of Directors
below.
Two directors will be elected at the 2017 Annual Meeting to
serve for a three-year term expiring at our Annual Meeting in 2020. The Board has nominated Cynthia J. Brinkley and John E. Klein for election as directors at this meeting. Each nominee is currently serving as a director and has consented to serve
for the three-year term. Each nominee elected as a director will continue in office until his or her successor has been elected and qualified.
We do not know of any
reason why any of the nominees for director named herein would be unable to serve; however, if any nominee is unable to serve as a director at the time of the Annual Meeting, your proxy may be voted for the election of another person the Board may
nominate in his place, unless you indicate otherwise.
Vote Required.
The affirmative vote of a majority of the voting power
represented in person or by proxy and entitled to vote is required for the election of each director.
The Board of Directors recommends a vote FOR the election of these nominees as directors of the Company.
4
Energizer
Holdings, Inc.
2016 Proxy Statement
INFORMATION ABOUT NOMINEES AND OTHER DIRECTORS
Please review the following information about the nominees and other directors continuing in office. The ages shown are as of December 31, 2016.
|
|
|
|
|
CYNTHIA J. BRINKLEY,
Director since 2015, Age 57
(Standing for election at
this meeting for a term expiring in 2020)
Ms. Brinkley is Executive Vice President, Global
Corporate Development for Centene Corporation, a government services managed care company. Prior to joining Centene in 2014, Ms. Brinkley was Vice President of Global Human Resources for General Motors from 2011 to 2013. Prior to GM, she was Senior
Vice President of Talent Development and Chief Diversity Officer for AT&T from 2008 to 2011. Ms. Brinkley worked for SBC Communications from 1986 to 2008, lastly as President of SBC / AT&T Missouri, when SBC Communications acquired
AT&T.
Ms. Brinkley brings significant experience in communications and human resources as
well as extensive experience as a senior executive at Fortune 10 and Fortune 200 companies to our Board of Directors and provides the Board with a unique perspective on high-profile issues facing our core businesses.
|
|
|
JOHN E. KLEIN,
Director since
2015, Age 71
(Standing for election at this meeting for a term expiring in 2020)
Mr. Klein served as President of Randolph College from 2007 to 2013. Previously, Mr. Klein served as Executive Vice Chancellor for Administration, Washington University
in St. Louis from 2004 to 2007. From 1985 to 2003, Mr. Klein served as President and Chief Executive Officer, Bunge North America, Inc. Prior to his appointment as CEO, he served in various senior executive positions for Bunge North America, and
earlier in his career, in a variety of positions internationally for Bunge, Ltd.
Mr. Klein
earned a law degree and practiced law in New York City for several years before joining Bunge Ltd. He is also a Director of the American University in Paris and a former director of Embrex, Inc. and Edgewell Personal Care Company (Edgewell), our
former parent company. He has also obtained significant administrative experience in the field of higher education. He brings the benefits of his diverse legal, international, operational and administrative background and experience to our
Board.
|
Energizer Holdings, Inc.
2016 Proxy Statement
5
INFORMATION ABOUT NOMINEES AND OTHER DIRECTORS
|
|
|
|
|
J.
PATRICK MULCAHY,
Director since 2015, Age 72
(Continuing in officeterm expiring in 2019)
Mr. Mulcahy has served as Chairman of Energizers Board of Directors since July 2015 and served
as Chairman of the Board of Edgewell, our former parent company, from 2007-2015. He served as Vice Chairman of the Board of our former parent company from January 2005 to January 2007, and prior to that time served as Chief Executive Officer of our
former parent company from 2000 to 2005, and as Chairman of the Board and Chief Executive Officer of Eveready Battery Company, Inc. from 1987 until his retirement in 2005. He is a former director of Ralcorp Holdings, Inc., Solutia, Inc. and
Hanesbrands Inc.
Mr. Mulcahy has over 40 years of experience in consumer products industries,
including almost 20 years as chief executive of Energizers battery business. He is very knowledgeable about the dynamics of our business and the categories in which we compete. His experience with the complex financial and operational issues
of consumer products businesses brings critical financial, operational and strategic expertise to our Board of Directors.
|
|
|
ALAN R. HOSKINS,
Director since
2015, Age 55
(Continuing in officeterm expiring in 2019)
Mr. Hoskins has been President and Chief Executive Officer of Energizer Holdings, Inc. since July 2015. Prior to his current position, he served as President and Chief
Executive Officer, Energizer Household Products of Edgewell, our former parent company, a position he held since April 2012. Mr. Hoskins held several leadership positions including Vice President, Asia-Pacific, Africa and Middle East from 2008 to
2011, Vice President, North America Household Products Division from 2005 to 2008, Vice President, Sales and Trade Marketing from 1999 to 2005, and Director, Brand Marketing from 1996 to 1999. He started his career at Union Carbide in 1983 following
several years in the retailer, wholesaler and broker industry.
Mr. Hoskins is very
knowledgeable about the dynamics of our business and the categories in which we compete. His experience with the complex financial and operational issues of consumer products businesses brings critical financial, operational and strategic expertise
to our Board of Directors.
|
6
Energizer
Holdings, Inc.
2016 Proxy Statement
INFORMATION ABOUT NOMINEES AND OTHER DIRECTORS
|
|
|
|
|
KEVIN
J. HUNT,
Director since 2015, Age 65
(Continuing in officeterm expiring in 2019)
Mr. Hunt served as President and Chief Executive Officer of Ralcorp Holdings, Inc., a private-brand
food and food service products company, from January 2012 to January 2013 upon its acquisition by ConAgra Foods, Inc. Mr. Hunt previously served as Co-Chief Executive Officer and President of Ralcorp Holdings from 2003 to 2011 and Corporate Vice
President from 1995 to 2003. Prior to joining Ralcorp Holdings, he was Director of Strategic Planning for Ralston Purina and before that he was employed in various roles in international and domestic markets and general management by American Home
Products Corporation. Mr. Hunt serves as a director of the Clearwater Paper Corporation. He also serves on the advisory Board of the Vi-Jon Company, owned by Berkshire Partners and served as a senior advisor to Treehouse Foods on the
acquisition and integration of the ConAgra Private Brands business. He is a former director of Ralcorp Holdings, Inc.
As a former CEO and President of a NYSE-listed company, Mr. Hunt brings his considerable experience to our Board and the committees thereof on which he serves.
|
|
|
PATRICK J. MOORE,
Director since
2015, Age 62
(Continuing in officeterm expiring in 2019)
Mr. Moore is President and Chief Executive Officer of PJM Advisors, LLC, a private equity investment and advisory firm. Prior to PJM, Mr. Moore served as Chairman and
Chief Executive Officer of Smurfit-Stone Container Corporation, a leader in integrated containerboard and corrugated package products and paper recycling, from 2002 to 2011 upon its acquisition by RockTenn Company. During his 24 year tenure at
Smurfit, Mr. Moore also served as Chief Financial Officer, Vice PresidentTreasurer and General Manager of the Companys Industrial Packaging division. Smurfit filed for voluntary Chapter 11 bankruptcy in January 2009 and emerged in June
2010. Mr. Moore previously held positions in corporate lending, international banking and corporate administration at Continental Bank in Chicago. He serves on the North American Review Board of American Air Liquide Holdings, Inc. and on the Board
of Archer Daniels Midland Company. He is a former director of Ralcorp Holdings, Inc., Exelis, Inc. and Rentech, Inc.
Mr. Moores experience and financial expertise contribute to the oversight of overall financial performance and reporting by our Board as well as operational and
strategic oversight.
|
Energizer Holdings, Inc.
2016 Proxy Statement
7
INFORMATION ABOUT NOMINEES AND OTHER DIRECTORS
|
|
|
|
|
BILL
G. ARMSTRONG,
Director since 2015, Age 68
(Continuing in officeterm expiring in 2018)
Mr. Armstrong is a private equity investor and a former director of Ralcorp Holdings, Inc. and
Edgewell, our former parent company.
From 2001 to 2004, Mr. Armstrong served as Executive Vice
President and Chief Operating Officer at Cargill Animal Nutrition. Prior to his employment with Cargill, Mr. Armstrong served as Chief Operating Officer of Agribrands International, Inc., an international agricultural products business, and as
Executive Vice President of Operations of the international agricultural products business of Ralston Purina Company. He also served as managing director of Ralstons Philippine operations, and during his tenure there, was a director of the
American Chamber of Commerce.
As a result of Mr. Armstrongs international and operational
background, as well as his extensive experience with corporate transactions, he provides a global perspective to the Board, which has become increasingly important as our international operations represent a significant portion of our annual
sales.
|
|
|
JAMES C. JOHNSON,
Director since
2015, Age 64
(Continuing in officeterm expiring in 2018)
Mr. Johnson served as General Counsel of Loop Capital Markets LLC, a financial services firm, from November 2010 until his retirement in January 2014. From 1998 to 2009,
Mr. Johnson served in a number of positions at The Boeing Company, an aerospace and defense firm, including Vice President, Corporate Secretary and Assistant General Counsel from 2003 until 2007, and Vice President and Assistant General Counsel,
Commercial Airplanes from 2007 to his retirement in March 2009. He is also a director of Ameren Corporation, Hanesbrands Inc. and Edgewell.
As a former General Counsel of a financial services firm and a former Vice President, Corporate Secretary and Assistant General Counsel of an aerospace and defense firm,
Mr. Johnson provides our board with extensive executive management and leadership experience, as well as strong legal, compliance, risk management, corporate governance and compensation skills.
|
8
Energizer
Holdings, Inc.
2016 Proxy Statement
INFORMATION ABOUT NOMINEES AND OTHER DIRECTORS
|
|
|
|
|
W.
PATRICK MCGINNIS,
Director since 2015, Age 69
(Continuing in officeterm expiring in 2018)
Mr. McGinnis is Chairman of Nestlé Purina PetCare Company. Mr. McGinnis served as Chief
Executive Officer and President of Nestlé Purina PetCare Company, a pet foods company, from 2001 through January 1, 2015. From 1980 to 1999, he served in various roles of increasing responsibility at Ralston Purina Company, including
President and Chief Executive Officer. Mr. McGinnis serves on the Board of Caleres, Inc. and is a former director of Edgewell, our former parent company.
Mr. McGinnis has over forty years of experience in consumer products industries, including almost twenty years as chief executive of the Purina pet food business. As a
result, he has expertise with respect to marketing and other commercial issues, competitive challenges, and long-term strategic planning, as well as valuable perspectives with respect to potential acquisitions of consumer products businesses that
make him an invaluable member of our Board.
|
|
|
JOHN R. ROBERTS,
Director since
2015, Age 75
(Not standing for re-electionterm expires as of the 2017 annual meeting)
Mr. Roberts served as Executive Director of Civic Progress St. Louis from 2001 to 2006 and served
as a Managing Partner of Mid-South Region at Arthur Andersen LLP from 1993 to 1998. He serves as a Director of Centene Corporation. Mr. Roberts is also a member of the American Institute of Certified Public Accountants and formerly served on
the Board of Regions Financial Corporation and Edgewell, our former parent company.
Mr. Roberts
brought many years of experience as an audit partner at Arthur Andersen to our Board. His extensive knowledge of financial accounting, accounting principles, and financial reporting rules and regulations, and his experience in evaluating financial
results and generally overseeing the financial reporting process of large public companies from an independent auditors perspective, provided invaluable expertise to our Board. His service as a board member and audit committee chair for other
public companies reinforced the knowledge and insight that he provided to our Board.
Having
reached the Board retirement age, Mr. Roberts will not stand for re-election at the 2017 Annual Meeting. The Company is grateful for his invaluable contributions and service during his tenure on our Board.
|
Energizer Holdings, Inc.
2016 Proxy Statement
9
THE BOARD OF DIRECTORS AND ENERGIZERS CORPORATE
GOVERNANCE
STANDING COMMITTEES AND MEETINGS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Board
Member
|
|
Board
|
|
|
|
Audit
|
|
|
|
Nominating and
Executive
Compensation
|
|
|
|
Finance and
Oversight
|
Bill G. Armstrong
|
|
ü
|
|
|
|
ü
|
|
|
|
ü
|
|
|
|
|
Cynthia J. Brinkley
|
|
ü
|
|
|
|
|
|
|
|
ü
|
|
|
|
|
Alan R. Hoskins
|
|
ü
|
|
|
|
|
|
|
|
|
|
|
|
ü
|
Kevin J. Hunt
|
|
ü
|
|
|
|
|
|
|
|
ü
|
|
|
|
ü
|
James C. Johnson
|
|
ü
|
|
|
|
|
|
|
|
ü
*
|
|
|
|
|
John E. Klein
|
|
ü
|
|
|
|
ü
|
|
|
|
|
|
|
|
ü
|
W. Patrick McGinnis
|
|
ü
|
|
|
|
|
|
|
|
|
|
|
|
ü
*
|
Patrick J. Moore
|
|
ü
|
|
|
|
ü
|
|
|
|
|
|
|
|
|
J. Patrick Mulcahy
|
|
ü
*
|
|
|
|
|
|
|
|
|
|
|
|
ü
|
John R. Roberts
|
|
ü
|
|
|
|
ü
*
|
|
|
|
|
|
|
|
|
Meetings held in fiscal year 2016
|
|
7
|
|
|
|
5
|
|
|
|
7
|
|
|
|
4
|
Audit:
Reviews auditing, accounting, financial reporting, internal control and risk
management functions. Responsible for engaging and supervising our independent accountants, resolving differences between management and our independent accountants regarding financial reporting, pre-approving all audit and non-audit services
provided by our independent accountants, and establishing procedures for the receipt, retention and treatment of complaints regarding accounting, internal accounting controls or auditing matters. Receives reports from the head of our internal audit
department. Reviews (i) managements programs to identify, assess, manage, and mitigate significant enterprise risks of the Company, including both strategic and operational risks, and (ii) the Companys risk management structures and
practices. Our Board has determined that all members are independent and financially literate in accordance with the criteria established by the SEC and the New York Stock Exchange (the NYSE). John R. Roberts served as chair of the Audit
Committee, and our Board determined that he is both independent and an audit committee financial expert, as defined by SEC guidelines. Having reached the Board retirement age, John R. Roberts will not stand for re-election at the 2017 Annual
Meeting. Following Mr. Roberts retirement, the Board intends to appoint Patrick J. Moore as the chair of the Audit Committee. The Audit Committees charter can be viewed on the Companys website,
www.energizerholdings.com
,
click on Investors, then Corporate Governance, then Audit Committee Charter.
Nominating and Executive Compensation:
Sets compensation of our executive officers,
administers our Equity Incentive Plan and grants equity-based awards, including performance-based awards, under the plan. Administers and approves performance-based awards under our executive officer bonus plan. Establishes performance criteria for
performance-based awards and certifies as to their achievement. Monitors management compensation and benefit programs, and reviews principal employee relations policies. Recommends nominees for election as directors or executive officers to the
Board, as well as committee memberships and compensation and benefits for directors. Administers our stock ownership guidelines. Conducts the annual self-assessment process of the Board and its committees, and regular review of our Corporate
Governance Principles. Our Board has determined that all members are non-employee directors, and are independent, as defined in the listing standards of the NYSE. James C. Johnson served as chair of the Nominating and Executive Company Committee.
The Nominating and Executive Compensation Committees charter can be viewed on the Companys website,
www.energizerholdings.com
, click on Investors, then Corporate Governance, then Nominating and Executive
Compensation Committee Charter.
10
Energizer
Holdings, Inc.
2016 Proxy Statement
THE BOARD OF DIRECTORS AND ENERGIZERS CORPORATE GOVERNANCE
Finance and Oversight:
Reviews our financial condition, objectives and strategies, and
acquisitions and other major transactions, and makes recommendations to the Board concerning financing requirements, our stock repurchase program and dividend policy, foreign currency management and pension fund performance. W. Patrick McGinnis
served as chair of the Finance and Oversight Committee. The Finance and Oversight Committees charter can be viewed on the Companys website,
www.energizerholdings.com
, click on Investors, then Corporate
Governance, then Finance and Oversight Committee Charter.
During fiscal 2016, all directors attended 75% or more of the Board meetings and meetings of
the committees on which they served during their period of service. Under our Corporate Governance Principles, each director is encouraged to attend our annual meeting of shareholders each year.
CORPORATE GOVERNANCE, RISK
OVERSIGHT AND DIRECTOR
INDEPENDENCE
Board Leadership Structure
Our Board regularly considers the appropriate
leadership structure for the Company and has concluded that the Company and its shareholders are best served by not having a formal policy on whether the same individual should serve as both chief executive officer and chairman of the Board. This
flexibility allows the Board to utilize its considerable experience and knowledge to elect the most qualified director as chairman of the Board, while maintaining the ability to separate the chairman and chief executive officer roles when necessary.
Currently, the roles of chairman of the Board and chief executive officer are separate. The chief executive officer is responsible for setting the strategic direction for the Company and the day-to-day leadership and performance of the Company,
while the chairman of the Board provides guidance and sets the agenda for Board meetings, in consultation with the chief executive officer, and presides over meetings of the full Board. The Chairman of the Board also
presides over non-management executive sessions of the Board. The Board periodically evaluates the structure most appropriate for the environment in which we operate.
Risk Oversight and Risk Management
The Board of Directors, acting both
directly and through its committees, is actively involved in oversight of the significant risks affecting our business. The Board of Directors and its committees risk oversight activities are informed by our managements risk assessment
and risk management processes.
Structure of Risk Oversight and Risk Management
The Boards role in risk oversight is consistent with the Companys leadership structure, with management having day-to-day responsibility for assessing and
managing the Companys risk exposure and the Board and its committees providing oversight in connection with those efforts, with particular focus on the most significant risks facing the Company.
The risk oversight responsibility of the Board and its committees is enabled by management evaluation and reporting processes that are designed to provide visibility to
the Board about the identification, assessment and management of critical risks and managements risk mitigation strategies as well as compliance matters. Management of day-to-day operational, financial and legal risks and compliance issues is
the responsibility of operational and executive leadership of the Company.
The primary management group responsible for the identification and management of risks
within our Company is the Compliance and Risk Management Committee (the CRMC). Our CFO sponsors the CRMC and our General Counsel and VP, Internal Audit co-lead the group.
We believe that the active involvement of our senior leaders in the CRMC sets a tone at the top, demonstrating the commitment that our executives have to creating a
culture of compliance and risk oversight.
Energizer Holdings, Inc.
2016 Proxy Statement
11
THE BOARD OF DIRECTORS AND ENERGIZERS CORPORATE GOVERNANCE
At the same time, we recognize the importance of how our compliance policies and risk identification and mitigation
strategies are being implemented within our daily operations globally.
As a result, we have established two subcommittees of the CRMC:
|
|
|
the Risk Subcommittee; and
|
|
|
|
the Compliance Subcommittee.
|
Each Subcommittee is populated with emerging leaders one to three organizational levels
below our senior executives, who can provide a perspective on the practical implementation of our compliance and risk management programs.
The purpose of the Risk
Subcommittee is to:
|
|
|
evaluate risks based on both their perceived impact on our Company and likelihood of occurrence;
|
|
|
|
identify and verify actions that are believed to be reasonably practicable to take to mitigate risks; and
|
|
|
|
verify the results of the risk analysis and mitigation efforts with the appropriate levels of management.
|
The purpose of
the Compliance Subcommittee is to:
|
|
|
review and determine compliance audit plans, sites and timing;
|
|
|
|
receive updates on compliance investigations worldwide; and
|
|
|
|
calibrate discipline to assure that all colleagues are treated equitably.
|
The Risk Subcommittee and the Compliance
Subcommittee provide monthly reports to the CRMC related to their separate scopes.
The CRMC then reports directly to the Audit Committee and advises the Audit
Committee on a quarterly basis regarding the Companys risk management structures and practices, as well as managements programs to identify, assess, manage, and mitigate significant enterprise risks of the Company. The Audit Committee,
in turn, reports to our Board of Directors. The CRMC also presents directly to the Board with regard to these matters on an annual basis.
Evaluation of Risks
Our
Company manages risk in several key areas, each of which is described in more detail below:
|
|
|
commercial and marketing risk
|
|
|
|
financial and internal control risk
|
|
|
|
legal and regulatory risk
|
|
|
|
information technology risk
|
|
|
|
operations and supply chain risk
|
|
|
|
employment policies and practices risk
|
Strategic Risk
Strategic Risk includes risks faced by our Company related to mergers, acquisition and divestures, strategic planning, major initiatives such as restructurings, economic
and geopolitical risks, our internal and external communications strategies and our organizational structure and incentives. The Risk Subcommittee, with input from our executive leadership, evaluates strategic risks and reports to the Finance and
Oversight Committee, the Audit Committee, or other appropriate committee of the Board, or the Board as a whole on the status of major initiatives as well as other major developments in strategic risk.
Governance Risk
Our Company strives to optimize shareholder communications
to convey valuable information to our shareholders. Senior executives and members of the Board periodically meet with shareholders to discuss the Companys performance and governance. The Board also annually evaluates its governance structures.
The Nominating and Executive Compensation Committee annually reviews the Companys Corporate Governance Principles and recommends amendments to the Board. Each
12
Energizer
Holdings, Inc.
2016 Proxy Statement
THE BOARD OF DIRECTORS AND ENERGIZERS CORPORATE GOVERNANCE
committee of the Board annually reviews its charter and recommends any changes for adoption by the Board. The Board also annually reviews the Companys succession plans for all senior
executive positions.
Commercial and Marketing Risk
The Risk Committee
and our commercial organization monitor the Companys exposure to commercial and marketing risks, including category and competitive pressures and events that could impact our brand reputation. The Board is kept informed of the status of major
commercial developments.
Financial and Internal Control Risk
The Risk
Committee evaluates the Companys exposure to financial and internal control risks, including risks related to foreign currencies, capital markets, cash flows, pension plans, and taxes. Management has put in place internal controls and conducts
internal audits with respect to the Companys financial statements. The Company has a hotline that can be used to report compliance issues, including any financial or accounting fraud, and uses financial and internal controls and monitoring in
an effort to prevent inadequate, incomplete or misleading disclosures in press releases and the Companys SEC filings.
The Audit Committee performs a central
oversight role with respect to financial and control risks, and meets with our independent auditors, outside the presence of senior management. It also regularly receives reports regarding our internal controls and compliance risks viewed as most
significant, along with managements processes for seeking to maintain compliance within an internal controls environment.
The Finance and Oversight Committee
also regularly reviews our policies and practices related to foreign currencies, capital markets, insurance, pension plans, and taxes.
Legal and Regulatory Risk
The
Companys legal department, led by our general counsel, monitors the Companys exposure to legal and regulatory risks, including intellectual property maintenance and infringement, global regulatory compliance, and, with the environmental
group, environmental matters. The Board is kept informed of the commencement and status of significant litigation.
Information Technology Risk
The Companys information technology group evaluates identified risks related to the Companys information technology systems, such as the impact of
significant information technology changes, cyber-attacks or hacking, the potential failure of the Companys information technology systems or loss or theft of data. The Board is kept informed of the status of major information technology
system changes.
Operations and Supply Chain Risk
The global operations
team monitors the Companys exposure to operational risks, including manufacturing and supply chain disruption. The global operations team, the information technology group and the Risk Subcommittee evaluate the Companys exposure to
certain event risks, such as natural disasters and political or economic instability. The Board is kept informed of the status of major manufacturing and supply chain changes as well as event risk.
Employment Policies and Practices Risk
As part of its responsibilities, the
Nominating and Executive Compensation Committee annually reviews the Companys compensation policies and practices for all employees, including executive officers, to determine whether the Companys compensation programs encourage
excessive risk-taking likely to have a material adverse effect on the Company. As described below under
Determining
Energizer Holdings, Inc.
2016 Proxy Statement
13
THE BOARD OF DIRECTORS AND ENERGIZERS CORPORATE GOVERNANCE
Executive Compensation
, the committee also employs an independent compensation consultant who advises and consults with the committee to determine both the structure and amounts of
executive compensation. For further
information, please see
Executive CompensationCompensation Policies and Practices as They Relate to Risk Management
below.
Risk Management
Although we have devoted significant resources to develop our risk management policies and procedures, these policies and
procedures, as well as our risk management techniques, may not be fully effective. In addition, there may be risks that exist, or that develop in the future, that we have not appropriately anticipated, identified or mitigated. In either case, we
could suffer losses and our results and financial position could be materially adversely affected. For a more detailed description of material risks to our results of operations or financial position, you should review the sections entitled
Risk Factors in our Annual Report on Form 10-K for fiscal 2016, as updated from time to time in the Companys public filings.
Codes of Conduct
Our Code of Conduct is designed to provide guidance on and articulate our commitment to several key matters such as safety and health, protecting the
environment, use of Company resources, and promoting a harassment-free work environment. It also addresses the legal and ethical facets of integrity in business dealings with suppliers, customers, investors and governments. We assess global
compliance with this policy annually.
Our Supplier Code of Conduct sets forth our Companys basic expectations for environmental, labor, supplier working
conditions and ethical practices that suppliers are expected to meet in order to do business with our Company. We believe we hold our suppliers to a high standard and use a risk-based approach to audit suppliers for ongoing compliance.
Compensation Committee Interlocks and Insider Participation
No member of the
Nominating and Executive Compensation Committee is or has been an officer or employee of the Company or any of its subsidiaries. In addition, no member of the committee had any relationships with the Company or any other entity that require
disclosure under the proxy rules and regulations promulgated by the SEC.
Determining Executive Compensation
The Nominating and Executive Compensation Committee reviews and approves compensation for our executive officers at the beginning of each fiscal year, including any
merit increases to base salary, our annual cash bonus program,
14
Energizer
Holdings, Inc.
2016 Proxy Statement
THE BOARD OF DIRECTORS AND ENERGIZERS CORPORATE GOVERNANCE
long-term equity incentive awards, and performance targets under those programs and awards. The committee members expect to base these determinations on their review of competitive market data
from our peer group, shareholder views, including the results of the most recent advisory vote on executive compensation, and the recommendations of the chief executive officer and our human resources department. Mercer, the committees
compensation consultant, conducts an in-depth annual review of our compensation practices, and those of our peer group, in order to support the committees review process. Mercer also advises the committee during its review of compensation for
non-employee directors and the competitiveness of our executive compensation programs. For more information on the committees review process and Mercers assistance to the committee, as well as on compensation consultants retained by the
Company, see
Executive CompensationCompensation Discussion and Analysis
below.
Committee Charters, Governance and Codes of Conduct
The charters of the committees of our Board of Directors and our Corporate Governance Principles have been posted on our website at
www.energizerholdings.com
, under Investors then Corporate Governance. Information on our website does not constitute part of this document. Our code of conduct and ethics applicable to the members of the Board of
Directors, officers and employees has been posted on our website as well. You can view our Code of Conduct on the Companys website,
www.energizerholdings.com
, under Investors then Corporate Governance and click
on Energizer Code of Conduct Manual.
Copies of the committee charters, the Corporate Governance Principles, the codes of conduct, and the Annual Report
on Form 10-K will be provided, without charge, to any shareholder upon request directed in writing to the Corporate Secretary, Energizer Holdings, Inc., 533 Maryville University Drive, St. Louis, Missouri 63141.
Director Independence
Our
Corporate Governance Principles, adopted by our Board, provide that a majority of the Board, and the entire membership of the Audit and the Nominating and Executive Compensation Committees of the Board, will consist of independent, non-employee
directors who meet the criteria for independence required by the NYSE listing standards. In addition, our Corporate Governance Principles provide that there may not be at any time more than two employee directors serving on the Board.
A director will be considered independent if he or she does not have a material relationship with us, as determined by our Board. To that end, the Board, in the
Corporate Governance Principles, has established guidelines for determining whether a director is independent, consistent with the listing standards of the NYSE. A director will not be considered independent if:
|
|
|
within the last three years, the director was employed by us or one of our subsidiaries, or an immediate family member of the director was employed by us or one of our subsidiaries as an executive officer;
|
|
|
|
(A) the director is a current partner or employee of a firm that is our internal or external auditor; (B) the director has an immediate family member who is a current partner of such a firm; (C) the director
has an immediate family member who is a current employee of such a firm and personally works on our audit; or (D) the director or an immediate family member was within the last three years a partner or employee of such a firm and personally
worked on our audit within that time; or
|
|
|
|
any of our present executive officers served on the compensation committee of another company that employed the director or an immediate family member of the director as an executive officer within the last three years.
|
Energizer Holdings, Inc.
2016 Proxy Statement
15
THE BOARD OF DIRECTORS AND ENERGIZERS CORPORATE GOVERNANCE
The following relationships will be considered material:
|
|
|
a director or an immediate family member is an executive officer, or the director is an employee, of another company which has made payments to, or received payments from, us and the payments to, or amounts received
from, that other company in any of the last three fiscal years, exceed the greater of $1 million or 2% of such other companys consolidated gross revenues;
|
|
|
|
a director or an immediate family member, during any twelve-month period within the last three years, received more than $120,000 in direct compensation from us, other than director and committee fees and pension or
other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service);
|
|
|
|
a director is an executive officer of a charitable organization and our annual charitable contributions to the organization (exclusive of gift-match payments), in any single fiscal year within any of the last three
years, exceed the greater of $1,000,000 or 2% of such organizations total charitable receipts;
|
|
|
|
a director is a partner of or of counsel to a law firm that, in any of the last three years, performed substantial legal services to us on a regular basis; or
|
|
|
|
a director is a partner, officer or employee of an investment bank or consulting firm that, in any of the last three years, performed substantial services to us on a regular basis.
|
For relationships not described above or otherwise not covered in the above examples, a majority of our independent directors, after
considering all of the relevant circumstances, may make a determination whether or not such relationship is material and whether the director may therefore be considered independent under the
NYSE listing standards. We have also considered and determined that members of our Audit Committee and Nominating and Executive Compensation Committee satisfy the additional independence requirements of the NYSE and SEC for such committees.
Director affiliations and transactions are regularly reviewed to ensure that there are no conflicts or relationships with the Company that might impair a directors
independence. Every year, we submit a questionnaire to each director and executive officer, in addition to conducting our own internal review, for the purpose of identifying certain potentially material transactions or relationships between each
director, or any member of his or her immediate family, and the Company, its senior management and its independent auditor.
Accordingly, based on the responses to
the 2016 questionnaire and the results of its review, the Board has affirmatively determined that all directors, other than Mr. Hoskins, are independent from management. The following are the non-employee directors deemed to be independent:
Bill G. Armstrong, Cynthia J. Brinkley, Kevin J. Hunt, James C. Johnson, John E. Klein, W. Patrick McGinnis, Patrick J. Moore, J. Patrick Mulcahy, and John R. Roberts.
Director Nominations
The Nominating and Executive Compensation Committee is
responsible for recommending candidates for election to our Board of Directors, consistent with the requirements for membership set forth in our Corporate Governance Principles. Those requirements include integrity, independence, diligence,
diversity, energy, forthrightness, analytical skills and a willingness to challenge and stimulate management, and the ability to work as part of a team in an environment of trust. The principles also indicate the Boards belief that each
director should have a basic understanding of (i) our principal
16
Energizer
Holdings, Inc.
2016 Proxy Statement
THE BOARD OF DIRECTORS AND ENERGIZERS CORPORATE GOVERNANCE
operational and financial objectives, plans and strategies, (ii) our results of operations and financial condition, and (iii) the relative standing of the Company and our business
segments in relation to our competitors. In addition to those standards, the committee seeks directors who will effectively represent the interests of our shareholders, and who bring to the Board a breadth of experience from a variety of industries,
geographies and professional disciplines. Although the Company does not have a formal policy with respect to diversity matters, the Board also considers factors such as diversity on the basis of race, color, national origin, gender, religion,
disability and sexual orientation. The committee reviews its effectiveness in balancing these considerations when assessing the composition of the Board. The committee is also responsible for articulating and refining specific criteria for Board and
committee membership to supplement, as appropriate, the more general criteria set forth in our Corporate Governance Principles.
The committee expects a high level
of commitment from Board members and evaluates each candidates leadership and experience, skills, expertise and character traits, including the candidates ability to devote sufficient time to Board and committee meetings in light of
other professional commitments. The committee also reviews whether a potential candidate meets Board and/or committee membership requirements, as set forth in our Corporate Governance Principles, determines whether a potential candidate is
independent according to the Boards established criteria, and evaluates the potential for a conflict of interest between the director and the Company.
We
expect that, when vacancies occur, or when our Board determines that increasing its size is appropriate, candidates will be recommended to the committee by other Board members or the chief executive officer. The committee, however, will consider and
evaluate any shareholder-recommended candidates by applying the same criteria used to evaluate candidates recommended by directors or management. The
committee also has authority to retain a recruitment firm if it deems it advisable. Shareholders who wish to suggest an individual for consideration for election to the Board of Directors may
submit a written nomination to the Corporate Secretary of the Company, 533 Maryville University Drive, St. Louis, Missouri 63141, along with the shareholders name, address and number of shares of common stock beneficially owned; the name of
the individual being nominated and number of shares of common stock beneficially owned by the nominee; the candidates biographical information, including age, business and residential addresses, and principal occupation for the previous five
years, and the nominees consent to being named as a nominee and to serving on the Board. A description of factors qualifying or recommending the nominee for service on the Board would also be helpful to the committee in its consideration. To
assist in the evaluation of shareholder-recommended candidates, the committee may request that the shareholder provide certain additional information required to be disclosed in our proxy statement under Regulation 14A of the Securities Exchange Act
of 1934 (the Exchange Act). If the committee determines a candidate, however proposed, is suitable for Board membership, it will make a recommendation to the Board for its consideration.
Under our bylaws, shareholders may also nominate candidates for election at an annual meeting of shareholders. See
Shareholder Proposals for 2018 Annual
Meeting
below for details regarding the procedures and timing for the submission of such nominations.
Director nominees submitted through this process
will be eligible for election at the annual meeting, but will not be included in the Companys proxy materials prepared for the meeting.
Stock Ownership
Guidelines
In order to help align the financial interests of our non-employee directors with those of our shareholders, our Corporate Governance
Energizer Holdings, Inc.
2016 Proxy Statement
17
THE BOARD OF DIRECTORS AND ENERGIZERS CORPORATE GOVERNANCE
Principles provide that our non-employee directors must maintain ownership of our common stock with a value of at least five times the directors annual retainer. New directors are given a
period of five years to attain full compliance with these requirements.
For purposes of these determinations, stock ownership includes shares of our common stock
which are owned directly or by family members residing with the director, or by family trusts, as well as vested options, vested and deferred restricted stock equivalents and unvested restricted stock equivalents, unless they are subject to
achievement of performance targets, and common stock or stock equivalents credited to a director under our deferred compensation plan. As of December 13, 2016, all of our directors are in compliance with these guidelines.
Communicating Concerns to the Board
We have established several means for
shareholders or others to communicate their concerns to our Board. If the concern relates to our financial statements, accounting practices or internal controls, the concern should be submitted in writing to the chairperson of our Audit Committee,
in care of the Corporate Secretary of the Company at our headquarters address. If the concern relates to our governance practices, business ethics or corporate conduct, the concern may be submitted in writing to the chairperson of our Nominating and
Executive Compensation Committee, or to the chairperson of our Finance and Oversight Committee, in care of the Corporate Secretary of the Company at our headquarters address. If the shareholder is unsure as to which category his or her concern
relates, he or she may communicate it to any one of the independent directors in care of the Companys Corporate Secretary at our headquarters address. The Corporate Secretary will review all communications so addressed and will forward to the
addressee(s) all communications determined to bear substantively on the business, management, or governance of the Company.
Our non-retaliation policy prohibits the Company, or any of its employees, from retaliating or taking any adverse action
against anyone for raising a good faith concern. If a shareholder or employee prefers to raise his or her concern in a confidential or anonymous manner, he or she may call the Energizer Hotline provided by the EthicsPoint System and operated by a
third-party provider, NAVEX Global, in North America at toll-free 877-521-5625, or leave a confidential message at our web address
www.energizer.ethicspoint.com
. Additional international phone numbers, contact details, and languages are
available at
www.energizer.ethicspoint.com
.
DIRECTOR COMPENSATION
We provided several elements of compensation to our non-employee directors for service on our Board during fiscal 2016. The Nominating and Executive Compensation
Committee, which makes recommendations to the full Board regarding director compensation, strives to set director compensation at the 50
th
percentile of the peer group. This peer group, which can
be found under
Executive CompensationCompensation Discussion and AnalysisImplementation of the Compensation Program
, has been selected for purposes of evaluating our executive compensation based on market data provided
by the committees independent consultant, Mercer.
Retainers and Meeting Fees
During fiscal year 2016, all the directors, other than Mr. Alan R. Hoskins, received the following compensation package for serving on the Board or its
committees. Mr. Hoskins, our Chief Executive Officer, receives no additional compensation for his service on the Board and its committees.
|
|
|
|
|
|
|
Annual retainer
|
|
$
|
|
|
|
100,000
|
Fee for each Board meeting in excess of 6
|
|
$
|
|
|
|
1,500
|
Fee for each committee meeting in excess of 6
|
|
$
|
|
|
|
1,500
|
18
Energizer
Holdings, Inc.
2016 Proxy Statement
THE BOARD OF DIRECTORS AND ENERGIZERS CORPORATE GOVERNANCE
The chairpersons of the committees also received an additional annual retainer of $20,000 for each committee that they
chaired, and the chairman of the Board received an additional annual retainer of $100,000 for his services as chairman.
Deferred Compensation Plan
Non-employee directors are permitted to defer all or a portion of their retainers and fees under the terms of our deferred compensation plan. Deferrals may be made into
(a) the Energizer common stock unit fund, which tracks the value of our common stock; or (b) the prime rate option under which deferrals are credited with interest at the prime rate quoted by The Wall Street Journal. Deferrals in the
deferred compensation plan are paid out in a lump sum in cash within 60 days following the directors termination of service on the Board.
Restricted Stock Equivalents
Initial Grant
. New directors that may be appointed or elected to the Board receive a grant of restricted stock equivalents with a
grant-date value of $200,000, which vest three years from the date of grant or upon certain other vesting events. Directors have the option to defer delivery of shares upon vesting of this award until retirement from the Board.
Annual Grant
. On the first business day of January of each year, each non-employee director is credited with a restricted stock equivalent
award with a grant-date value of $110,000 under our Equity Incentive Plan. This award vests one year from the date of grant or upon certain other vesting events. Directors have the option to defer the delivery of shares upon vesting of this award
until retirement from the Board.
Energizer Holdings, Inc.
2016 Proxy Statement
19
THE BOARD OF DIRECTORS AND ENERGIZERS CORPORATE GOVERNANCE
DIRECTOR COMPENSATION TABLE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name (1)
|
|
Fees Earned or
Paid in
Cash
(1)
|
|
|
Stock Awards
(2)
|
|
|
Option Awards
(3)
|
|
|
Non-Equity
Incentive
Plan
Compensation
|
|
|
Change in Pension
Value and
Non-
Qualified Deferred
Compensation
Earnings
|
|
|
All Other
Compensation
(4)(5)
|
|
|
Total
|
|
J.P. Mulcahy
|
|
|
$201,500
|
|
|
|
$110,034
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$311,534
|
|
B.G. Armstrong
|
|
|
$103,000
|
|
|
|
$110,034
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$213,034
|
|
C.J. Brinkley
|
|
|
$103,000
|
|
|
|
$110,034
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$213,034
|
|
K.J. Hunt
|
|
|
$103,000
|
|
|
|
$110,034
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$213,034
|
|
J.C. Johnson
|
|
|
$123,000
|
|
|
|
$110,034
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$233,034
|
|
J.E. Klein
|
|
|
$101,500
|
|
|
|
$110,034
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$211,534
|
|
W.P. McGinnis
|
|
|
$121,500
|
|
|
|
$110,034
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$231,534
|
|
P.J. Moore
|
|
|
$101,500
|
|
|
|
$110,034
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$211,534
|
|
J.R. Roberts
|
|
|
$121,500
|
|
|
|
$110,034
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$0
|
|
|
|
$231,534
|
|
(1)
|
This column reflects retainers and meeting fees earned during fiscal year 2016.
|
(2)
|
This column reflects the aggregate grant date fair value, in accordance with Financial Accounting Standards Board (FASB), Accounting Standards Codification (ASC) Section 718, of the
restricted stock equivalent award on January 4, 2016 under our Equity Incentive Plan valued at approximately $110,000 as described in the narrative above. The award was valued based on the grant date fair value of $34.70. Refer to Note 11,
Share-Based Payments of the Notes to Consolidated Financial Statements of our Annual Report on Form 10-K for the year ended September 30, 2016 for further discussion. There were no FASB ASC Section 718 compensation expenses
associated with the vested but deferred stock equivalents held by the directors during fiscal 2016. Vested restricted stock equivalents that the directors elected to defer conversion until retirement from the board are discussed in more detail
under
Stock Ownership InformationOwnership of Directors and Executive Officers
.
|
(3)
|
No options were granted to directors in fiscal year 2016. There were no outstanding shares of underlying stock options held by any director as of September 30, 2016.
|
(4)
|
Directors may also, from time to time during the fiscal year, be provided with samples of our products, with an incremental cost of less than $50.
|
(5)
|
The following items are not considered perquisites and are not included within the above disclosure of director compensation:
|
|
(i)
|
The directors are covered under the terms of our general directors and officers liability insurance policies, the premiums for which are a general expense of the Companywe do not obtain a specific
policy for each director, or for the directors as a group.
|
|
(ii)
|
We provide transportation and lodging for out-of-town directors attending Board and committee meetings at our headquarters.
|
|
(iii)
|
The directors may make requests for matching contributions to charitable organizations from the Energizer charitable foundation, which we have funded from time to time, and the directors of that foundation, all of whom
are employees of the Company, have determined to honor such requests which are in accordance with the charitable purpose of the foundation, and which do not exceed $5,000 in any year. All contributions are made out of the funds of the foundation,
and are not made in the name of the requesting director.
|
20
Energizer
Holdings, Inc.
2016 Proxy Statement
ITEM 2. RATIFICATION OF APPOINTMENT OF INDEPENDENT
AUDITOR
Our Audit Committee, in accordance with authority granted in its charter by the Board, appointed PricewaterhouseCoopers LLP (PwC) as
independent auditor for the current fiscal year. PwC has served as our independent auditor since our Spin-Off from our former parent company, and served as our former parent companys independent auditor for every fiscal year since 2000. PwC
has begun certain work related to the 2017 audit as approved by the Audit Committee. Information on independent auditor fees for the last two fiscal years is set forth below. The Board and the Audit Committee believe that the retention of PwC to
serve as independent auditor is in the best interests of the Company and its shareholders. In making this determination, the Board and the Audit Committee considered a number of factors, including:
|
|
|
Audit Committee members assessment of PwCs performance;
|
|
|
|
Managements assessment of PwCs performance;
|
|
|
|
PwCs independence and integrity;
|
|
|
|
PwCs fees and the quality of services provided to the Company; and
|
|
|
|
PwCs global capabilities and knowledge of our global operations.
|
A representative of PwC will be present at the
2017 Annual Meeting and will have an opportunity to make a statement, if desired, as well as to respond to appropriate questions.
Although NYSE listing standards
require that the Audit Committee be directly responsible for selecting and retaining the independent auditor, we are providing shareholders with the means to express their views on this issue. Although this vote will not be binding, in the event the
shareholders fail to ratify the appointment of PwC, the Audit Committee will reconsider its appointment. Even if the appointment is ratified, the Audit Committee in its discretion may direct the appointment of a different independent auditing firm
at any time during the year if the Audit Committee determines that such a change would be in the best interests of the Company and its shareholders.
Vote
Required.
The affirmative vote of a majority of the voting power represented in person or by proxy and entitled to vote is required for ratification.
The members of the Audit Committee and the Board of Directors recommend a vote FOR ratification of the appointment
of PwC as the Companys independent auditor for fiscal year 2017.
Fees Paid to PricewaterhouseCoopers LLP(1)
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
FY 15
|
|
|
FY 16
|
|
Audit Fees
|
|
$
|
1,373
|
|
|
$
|
3,964
|
|
Audit-Related Fees
|
|
|
14
|
|
|
|
18
|
|
Tax Fees:
|
|
|
|
|
|
|
|
|
Tax Compliance/preparation
|
|
|
76
|
|
|
|
21
|
|
Other Tax Services
|
|
|
195
|
|
|
|
276
|
|
|
|
|
|
|
|
|
|
|
Total Tax Fees
|
|
|
271
|
|
|
|
297
|
|
All Other Fees
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
Total Fees
|
|
$
|
1,658
|
|
|
$
|
4,279
|
|
|
|
|
|
|
|
|
|
|
Energizer Holdings, Inc.
2016 Proxy Statement
21
(1)
|
For fiscal year 2015, the fees reflected above represent those fees paid by Energizer after the Spin-Off from our former parent company. The total fees for audit and audit related matters of Energizer were $3,540 for
the total fiscal year 2015, inclusive of those fees paid by our former parent company prior to separation.
|
Services Provided by PricewaterhouseCoopers LLP
The table above discloses fees paid to PwC during the last fiscal year for the following professional services:
|
|
Audit Fees
These are fees for professional services performed by PwC for the audit of our annual financial statements and review of financial statements included in our 10-Q filings, and services that are
normally provided in connection with statutory and regulatory filings or engagements.
|
|
|
Audit-Related Fees
These are fees for assurance and related services performed by PwC that are reasonably related to the performance of the audit or review of our financial statements.
|
|
|
Tax Fees
These are fees for professional services performed by PwC with respect to tax compliance, tax advice and tax planning. This includes preparation of original and amended tax returns for the Company
and our consolidated subsidiaries; refund claims; payment planning; and tax audit assistance.
|
|
|
All Other Fees
These are fees for other permissible work performed by PwC that does not meet the above category descriptions.
|
Audit Committee Pre-Approval Policy
The Audit Committee has a formal policy
concerning approval of all services to be provided by our independent auditor, including audit, audit-related, tax and other services. The policy requires that all services the auditor may provide to us must be pre-approved by the committee. The
chairman of the committee has the authority to pre-approve permitted services that require action between regular committee meetings, provided he reports to the committee at the next regular meeting. Early in each fiscal year, the committee approves
the list of planned audit and non-audit services to be provided by the auditor during that year, as well as a budget estimating spending for such services for the fiscal year. Any proposed services exceeding the maximum fee levels set forth in that
budget must receive specific pre-approval by the Audit Committee. As applicable, the committee pre-approved all fees and services paid by Energizer for fiscal 2016.
AUDIT
COMMITTEE REPORT
The Audit Committee of the Companys Board of Directors consists entirely of non-employee directors that are independent, as defined in
Section 303A.02 of the New York Stock Exchange Listed Company Manual.
The Audit Committee is responsible for the duties set forth in its charter, but is not
responsible for preparing the financial statements, implementing or assessing internal controls or auditing the financial statements. Management is responsible for the Companys internal controls and the financial reporting process. The
independent accountants are responsible for performing an independent audit of the Companys consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States) (the
PCAOB) and issuing a report thereon. The Committees responsibility is to monitor and oversee these processes.
As part of its oversight of the
Companys financial statements, the Committee reviews and discusses with both management and the Companys independent registered public accountants, PricewaterhouseCoopers LLP (PwC), all annual and quarterly financial
statements prior to their issuance. With respect to the Companys audited financial statements for the Companys fiscal year
22
Energizer
Holdings, Inc.
2016 Proxy Statement
ended September 30, 2016, management of the Company has represented to the Committee that the financial statements were prepared in accordance with generally accepted accounting principles.
The Committee has reviewed and discussed those financial statements with management and PwC, including a discussion of critical accounting policies, the quality, not just the acceptability, of the accounting principles followed, the reasonableness
of significant judgments reflected in such financial statements and clarity of disclosures in the financial statements. The Audit Committee has also discussed with PwC the matters required to be discussed by Auditing Standard No. 16, as adopted
by the PCAOB.
In fulfilling its oversight responsibilities for reviewing the services performed by Energizers independent registered public accountants, the
Audit Committee retains sole authority to select, evaluate and replace the outside auditors, discusses with the independent registered public accountants the overall scope of the annual audit and the proposed audit fees, and annually evaluates the
qualifications, performance and independence of the independent registered public accountants and its lead audit partner. Annually the Audit Committee oversees a process to assess the performance of the auditor and utilizes the results of that
assessment when considering their reappointment. The Committee also annually discusses PwCs internal quality review process and the PCAOBs inspection report on PwC, as well as the results of any internal quality reviews or PCAOB
inspections of key engagement team members. In accordance with SEC rules, lead audit partners are subject to rotation requirements to limit the number of consecutive years an individual partner may provide service to the Company. For lead and
concurring partners, the maximum number of consecutive years of service is five years. The process for selection of the Companys lead audit partner pursuant to this rotation policy involves a meeting between the Chair of the Audit Committee
and the candidate for the role, as well as discussion by the full Committee and with management.
The Audit Committee has received the
written disclosures from PwC required by PCAOB Rule 3526 (Communication with Audit Committees Concerning Independence), as modified or supplemented, and has discussed the independence of PwC with members of that firm. In doing so, the Committee
considered whether the non-audit services provided by PwC were compatible with its independence. In fiscal 2016, the Audit Committee met five times with the internal auditors and PwC, with and without management present, to discuss the results of
their examination, the evaluations of the Companys internal controls and the overall quality of the Companys financial reporting.
In addition, the Audit
Committee reviewed key initiatives and programs aimed at maintaining the effectiveness of the Companys internal and disclosure control structure. As part of this process, the Committee continued to monitor the scope and adequacy of the
Companys internal auditing program, reviewing internal audit department staffing levels and steps taken to maintain the effectiveness of internal procedures and controls.
Based on the review and discussions referred to above, the Audit Committee recommended to the Companys Board of Directors that the audited financial statements for
the fiscal year ended September 30, 2016 be included in the Companys Annual Report on Form 10-K for that year and has selected PwC as the Companys independent registered public accountants for fiscal year 2017, subject to
shareholder ratification.
|
|
|
|
|
|
|
|
|
|
|
John R. RobertsChairman
|
|
|
|
John E. Klein
|
|
|
|
|
Bill G. Armstrong
|
|
|
|
Patrick J. Moore
|
|
|
No portion of this Audit Committee Report shall be deemed to be incorporated by reference into any filing under the Securities Act of
1933, as amended (the Securities Act), the Exchange Act, or through any general statement incorporating by reference in its entirety the Proxy Statement in which this report appears, except to the extent that the Company specifically
incorporates this report or a portion of it by reference. In addition, this report shall not be deemed to be filed under either the Securities Act or the Exchange Act.
Energizer Holdings, Inc.
2016 Proxy Statement
23
EXECUTIVE COMPENSATION
The following narratives and tables discuss the compensation paid in fiscal 2016 to our chief executive officer, chief financial officer and our other three most highly
compensated executive officers, whom we refer to collectively as our named executive officers or NEOs. Our named executive officers for fiscal 2016 were:
|
|
|
Alan R. Hoskins, Chief Executive Officer;
|
|
|
|
Brian K. Hamm, Executive Vice President and Chief Financial Officer;
|
|
|
|
Mark S. LaVigne, Executive Vice President and Chief Operating Officer;
|
|
|
|
Gregory T. Kinder, Executive Vice President and Chief Supply Chain Officer; and
|
|
|
|
Emily K. Boss, Vice President and General Counsel.
|
Our named executive officers were determined based on the
compensation earned during the 2016 fiscal year, as shown in the 2016
Summary Compensation Table
below.
COMPENSATION DISCUSSION AND ANALYSIS
Overview
Energizer
Holdings, Inc. (Energizer), through its operating subsidiaries, is one of the worlds largest manufacturers, marketers and distributors of household batteries, specialty batteries and lighting products, and a leading designer and
marketer of automotive fragrance and appearance products.
On July 1, 2015, Energizer completed the legal separation from our former parent company, Edgewell
Personal Care Company (Edgewell or former parent company), via a tax free spin-off (the Spin-Off). Under the terms of the Spin-Off, Edgewell common shareholders of record as of the close of business on
June 16, 2015, the record date for the distribution, received one share in Energizer for each share of Edgewell common stock they held. Edgewell completed the distribution of Energizer common stock to its shareholders on July 1, 2015, the
distribution date.
Energizer now operates as an independent, publicly traded company on the New York Stock Exchange, trading under the symbol ENR.
In fiscal 2016, our Nominating and Executive Compensation Committee (the NECC or the committee) took into consideration the unique circumstances
arising from the Companys emergence as a stand-alone operating company in structuring appropriate compensation that would best balance the goals of incenting, retaining and attracting highly talented executives while maintaining a pay
for performance culture.
Energizer is committed to building compensation programs that align our business strategy with our shareholders interests. Our
compensation guiding principles are to structure executive compensation that is:
Our primary compensation strategy is Pay for Performance, which drives a culture of
accountability and productivity. Underlying all of our decisions regarding compensation is our commitment to delivering consistent and sustainable operating results and earnings to our shareholders. We strongly
24
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
believe that our performance-based compensation programs which incentivize the attainment of Energizers short- and long-term financial objectives are the most effective approach to
delivering on that commitment.
This
Compensation Discussion and Analysis
explains and analyzes compensation awarded to or earned by our named
executive officers during fiscal 2016. This
Compensation Discussion and Analysis
should be read in conjunction with the tabular disclosures below.
Energizer Holdings, Inc.
2016 Proxy Statement
25
EXECUTIVE COMPENSATION
Key Elements of Executive Compensation in Fiscal 2016
The elements of our executive compensation program in 2016 as well as the purpose of each item are shown in the following table:
Executive Compensation Elements
|
|
|
|
|
Compensation Element
|
|
Description
|
|
Reason
|
|
|
|
Base Salary
|
|
Annual fixed salaries, payable in cash to the executive officers as follows:
Mr. Hoskins - $927,000
Mr. Hamm - $540,750
Mr. LaVigne - $540,750
Mr. Kinder - $418,000
Ms. Boss - $412,000
|
|
Helps attract and retain key individuals. Part of Energizers balanced approach to executive compensation.
|
|
|
|
Cash Bonus
|
|
Bonuses are payable in cash upon achievement of pre-determined company-wide metrics:
adjusted free cash flow (25%)
adjusted net sales (25%)
adjusted SG&A % sales (25%)
adjusted operating profit (25%)
|
|
Promotes achievement of company-wide performance goals. The targets were chosen based on Energizers business plan for fiscal 2016 and these metrics represent the
critical drivers of our business.
|
|
|
|
Equity Awards
|
|
Restricted stock equivalent awards with a three-year vesting period awarded to each of the named executive
officers.
70% of the award is performance-based
and vests based only upon achievement of pre-determined performance targets of two metrics:
¡
cumulative adjusted earnings per share; and
¡
cumulative free cash flow as a percentage of adjusted net sales.
30% of the award vests on the third anniversary of the grant if the recipient remains employed with the Company.
|
|
Awards create a strong alignment with shareholder interests and reward long-term value
creation.
|
26
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
|
|
|
|
|
Compensation Element
|
|
Description
|
|
Reason
|
|
|
|
Supplemental Retirement Plans
|
|
Executives participate in the qualified defined contribution retirement plans available for all employees, as well as non-qualified supplemental
defined contribution retirement plans that extend similar participation in retirement benefits otherwise limited by federal statute.
|
|
Ensures that the executives receive the same relative value compared to other employees who are not subject to these limits.
|
|
|
|
Executive Severance
Plan and Change of Control Agreements
|
|
Executive Severance Plan and Change of Control Agreements provide certain benefits upon the termination of employment.
|
|
Standardizes the executive severance process and retains key
executives. Allows executives to make decisions focusing on the interests of shareholders while using a double trigger (a change of control plus termination) to avoid a windfall.
|
|
|
|
Perquisites
|
|
A limited number of perquisites are available for our executive officers. The primary perquisite consists of
the financial planning program, which provides reimbursement for a percentage of the costs of qualifying financial planning, legal, and tax preparation services.
|
|
Provide other benefits competitive with the compensation peer group and encourage executives to proactively manage their financial
wellness.
|
Key Changes to Executive Compensation
In
fiscal 2016, the NECC took several important actions regarding executive compensation, described below.
Adoption of annual bonus program and long-term equity
incentive award metrics
The annual bonus program adopted by the NECC for fiscal 2016 included four performance metrics:
|
|
|
Adjusted Free Cash Flow
(25%).
Free Cash Flow measures the cash generated by our business. We believe that our investors highly value our ability to generate free cash flow. As a result, maximizing
free cash flow is our top financial objective and this metric encourages delivery on sales goals and cost targets as well as prudent management of capital expenditures and working capital.
|
|
|
|
Adjusted Net Sales
(25%)
.
Net Sales measures revenue and encourages development of consumer-relevant innovations and in-store execution to drive product sales.
|
|
|
|
Adjusted Selling, General & Administrative Expense as a percentage of Net Sales (SG&A % Sales)
(25%)
.
The SG&A % Sales metric measures the overhead costs that we incur as a
percentage of sales and encourages tight cost controls, both through our zero-based budgeting efforts and a variable cost structure.
|
|
|
|
Adjusted Operating Profit
(25%)
.
Operating profit measures underlying business profit and encourages selling products, generating strong gross margins and maintaining tight cost controls.
|
Energizer Holdings, Inc.
2016 Proxy Statement
27
EXECUTIVE COMPENSATION
The long-term equity incentive awards granted in November 2015 by the NECC included two performance metrics:
|
|
|
Cumulative Adjusted Earnings per Share
(50%)
.
Adjusted Earnings per Share measures our adjusted earnings divided by the number of diluted shares outstanding. This metric aligns management
with shareholders through a shared focus on the earnings that accrue to an investor in our common stock.
|
|
|
|
Cumulative Free Cash Flow as a percentage of Adjusted Net Sales (FCF % Sales)
(50%)
.
The FCF % Sales metric measures the cash we generate as a percentage of adjusted sales. Given the
importance that our investors place on free cash flow generation, we included a Free Cash Flow metric in both our annual bonus program and long-term incentive plan. The Free Cash Flow metric in the annual bonus program measures absolute free cash
flow delivered by our business, and FCF % Sales in our long-term equity incentive program measures free cash flow relative to net sales and encourages a sustained focus on maximizing cash flow over the long term.
|
The NECC develops targets for the annual bonus program and the long-term equity incentive awards to align executive compensation with the achievement of Energizers
strategic goals as well as the short- and long-term financial objectives that we have communicated to our shareholders.
SpotlightWhy is a Free Cash Flow metric used in both our short-term and our long-term incentive plans?
As our investors know, maximizing cash flow is our #1 priority as a business. We believe that free cash flow is
important for a number of reasons:
|
|
|
Ability to generate cash flow is a strong indicator of the underlying health of the business
|
|
|
|
Maximizing cash flow requires performance across a number of different areas:
|
|
¡
|
|
Expanding gross margins
|
|
¡
|
|
Controlling operating costs and corporate overheads
|
|
¡
|
|
Managing capital expenditures
|
|
¡
|
|
Improving working capital metrics such as days payable, days receivable and days in inventory
|
|
|
|
Strong cash flow provides opportunities to deliver shareholder return through re-investment in the business, dividends, share repurchase and acquisitions
|
We use free cash flow in our annual bonus plan to reward delivery of the cash flow amounts called for by our
annual plans, and free cash flow as a percentage of sales in our long-term incentive plan to incentivize management to create a business culture that generates strong cash flow year after year.
Changes to executive benefits and corporate policies in fiscal 2016
|
|
|
Effective September 2016, consistent with our principle of aligned, the NECC adopted an amendment to our Insider Trading Policy to prohibit purchasing Energizer securities on margin, holding Energizer
securities in a margin account or pledging Energizer securities as collateral.
|
Objectives of Energizers Compensation Philosophy
The key objective of our compensation philosophy is to reward management based on their success in increasing our shareholder value. With a focus on achieving this
overarching goal, our overall executive compensation program is designed to provide a compensation package that enables us to attract and retain highly talented executives and maintain a performance-oriented culture.
28
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
Pay for Performance
Our goal is to instill a pay for performance culture throughout our operations, with total compensation opportunities targeted near the 50th percentile of
our peer group. However, because a majority of our compensation is performance-based, actual cash compensation paid to our named executive officers could vary from that paid to executive officers in our peer group, based on achievement of
performance targets.
In fiscal 2016, a significant portion of targeted compensation for our named executive officers was variablenot fixedcompensation,
rewarding the named executive officers for the achievement of outstanding and sustained performance, which builds shareholder value. Target compensation consisted of the annual cash bonus and equity awards granted by the NECC. We believe this
compensation structure offers high potential rewards for superior performance, and significantly lower compensation for results below target.
In November 2015, our
NECC approved the mix of total fiscal year 2016 target compensation (comprised of base salary, annual cash bonus and equity-based incentive compensation) for our NEOs as shown below:
Competitive Total Compensation Package
Our executive officers are highly experienced, with average industry experience of over 20 years. Because of managements level of experience and successful track
record, as well as the value of maintaining continuity in senior executive positions, we view retention of key executives as important to the ongoing success of our operations. Consequently, we:
|
|
|
target total compensation packages near the 50
th
percentile of our peer group of companies to help retain key executives and remain competitive in attracting new
employees; and
|
|
|
|
establish long-term vesting periods for time-based equity-based awards, to provide additional retention incentives.
|
Alignment with Shareholder Interests
In order to align the interests
of our executive officers with those of our shareholders, we use a combination of equity-based incentives, stock ownership guidelines, and pay for performance compensation models. A significant portion of our executive officers
compensation package consists of equity grants. By tying a significant portion of the officers personal wealth to the performance of our common stock, it aligns our officers interests with those of our shareholders. In addition, our
compensation programs use short- and long-term performance metrics that incentivize the
Energizer Holdings, Inc.
2016 Proxy Statement
29
EXECUTIVE COMPENSATION
achievement of critical operational, financial and strategic goals for the Company. We strongly believe that such performance-based compensation drives the attainment of our corporate financial
goals and aligns our executive officer compensation with the interests of our shareholders.
Compensation Benchmarking
At the Spin-Off on July 1, 2015, Mercer, the compensation consultant for the NECC, with input from the committee, developed a customized peer group of 16 companies based
on a variety of criteria, including consumer products businesses, businesses with a strong brand focus, competitors for executive talent, and similarly-sized businesses in terms of revenues, employees, geographic scale and breadth of distribution
channels.
Mercer used that peer group data to provide a market comparison for our executive compensation program as an input to the determination of compensation of
our named executive officers for fiscal 2016. Total compensation opportunities were targeted at the 50th percentile of our peer group for comparable positions. The market comparison was made for each key component of compensation, including base
pay, target annual bonus, target total cash compensation and grant-date value of long-term incentives. Mercer also analyzed the aggregate equity utilization as compared to the peer group. In addition, Mercer reviewed the terms of our
change-in-control program for our executives for consistency with market practices.
The peer group used by Mercer, and approved by the NECC, for its review of
fiscal 2016 compensation consisted of the following companies. The industries in which the companies are engaged are noted: (1) household products; (2) personal care; (3) food and beverage; and (4) apparel.
|
|
|
|
|
Jarden Corporation (1)
|
|
Church
& Dwight Inc. (1)(2)
|
|
Snyders-Lance Inc. (3)
|
Newell Rubbermaid (1)
|
|
The Scotts Miracle-Gro Company (1)
|
|
Central Garden & Pet Co. (1)
|
The Clorox Company (1)
|
|
Tupperware
Brands Corporation (1)
|
|
Revlon Inc. (2)
|
Hanesbrands Inc. (4)
|
|
Monster
Beverage Corporation (3)
|
|
Helen Of Troy Ltd (2)
|
Spectrum Brands Holdings, Inc. (1)
|
|
Post
Holdings, Inc. (3)
|
|
|
Hasbro Inc. (1)
|
|
Hain Celestial Group, Inc. (3)
|
|
|
The following table provides an overview of how we compared to our peer group companies based on revenue for the most recent reported
fiscal year and number of employees as of September 2016.
|
|
|
|
|
|
|
|
|
(dollars in millions)
|
|
Revenue
|
|
|
Employees
|
|
75
th
Percentile
|
|
$
|
4,951
|
|
|
|
13,625
|
|
50
th
Percentile
|
|
$
|
3,210
|
|
|
|
7,104
|
|
25
th
Percentile
|
|
$
|
2,191
|
|
|
|
4,850
|
|
|
|
|
Energizer
|
|
$
|
1,634
|
|
|
|
4,800
|
|
Elements of Compensation
Base Pay
In November 2015, we benchmarked our executives base pay against our peer group. We benchmark salaries, as well as other components of our executive
compensation, annually as a guide to setting compensation for key positions, including the named executive officers, in the context of prevailing market practices. Our management and the NECC believe that an important benchmark for base salaries is
the 50th percentile for the peer group, but also that it is important to consider the interplay of all of the benchmarked components of total compensation as well as the individuals performance.
30
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
At the beginning of each fiscal year, the NECC establishes the salaries of the executive officers (other than the chief
executive officer) with recommendations from the chief executive officer. These recommendations are based on an assessment of the individuals responsibilities, experience and individual performance. The salary of the chief executive officer is
set by the NECC, with input with respect to prevailing market practices from the committees compensation consultant. The NECC uses this information, along with its analysis of the performance and contributions of the chief executive officer
against performance goals, to determine an appropriate salary.
In November 2015, as part of its annual review, the NECC evaluated the base salaries of the named
executive officers and set the base salaries of the named executive officers for fiscal 2016 as follows: Mr. Hoskins$927,000; Mr. LaVigne$540,750; Mr. Hamm$540,750; Mr. Kinder$418,000 and
Ms. Boss$412,000.
Incentive Programs
In November 2015,
the NECC approved an incentive compensation structure for our key executives, consisting of an annual performance program, paid in cash, and a three-year performance program, through the grant of restricted stock equivalents. Consistent with the
requirements for performance-based compensation under Section 162(m) of the Internal Revenue Code of 1986, as amended, awards to officers under our annual performance program are made under the terms of our shareholder-approved executive officer
bonus plan, and the three-year performance awards are granted under the terms of our shareholder-approved 2015 Equity Incentive Plan.
Cash Bonus Program
The cash bonuses to Energizers key executives, including our named executive officers, were based on a percentage of the executives annual salary,
and adjusted based on performance against certain metrics determined by the NECC. Our 2016 annual bonus program was designed to measure performance against four metrics:
|
|
|
Adjusted Net Sales (25% of the named executive officers bonus target);
|
|
|
|
Adjusted SG&A as a Percentage of Net Sales (25% of the named executive officers bonus target);
|
|
|
|
Adjusted Operating Profit (25% of the named executive officers bonus target); and
|
|
|
|
Adjusted Free Cash Flow (25% of the named executive officers bonus target).
|
The performance goals for each metric
were set at the beginning of the fiscal year. Each officer was assigned individual bonus targets based upon individual performance and prevailing market practice information provided by the compensation consultant to the NECC. For fiscal 2016, the
following bonus targets, defined as a percentage of the individuals base pay, were assigned to our named executive officers:
The named executive officers received overall bonus payouts based 100% on the company performance
metrics described below, and there was no individual performance component or non-performance-based component of the payout.
Energizer Holdings, Inc.
2016 Proxy Statement
31
EXECUTIVE COMPENSATION
The payouts under the Cash Bonus Program were made by us in November 2016 following certification of the results by the
NECC.
These payouts were based on outcomes under the following performance metrics:
Adjusted Net Sales
Adjusted Net Sales means net sales as reported by
Energizer, subject to adjustment for certain limited matters, including the effects of acquisitions, divestitures, extraordinary transactions such as mergers or spin-offs, and variations in the exchange rate between foreign currencies and budget
exchange rate.
The threshold, target and stretch achievement levels, and the percent payout at each level, were as follows:
|
|
|
|
|
|
|
FY16 Cash Bonus Plan Metrics
(25% of Bonus Target)
|
|
Threshold
50% Payout
|
|
Target
100% Payout
|
|
Stretch
200% Payout
|
Adjusted Net Sales
|
|
$1,479.70 million
|
|
$1,557.60 million
|
|
$1,596.50 million
|
Bonuses indicated increase proportionately in 1/10th of 1% increments for final results between the goals indicated with maximum bonus at
stretch. No bonuses tied to performance are paid for results below the Threshold goal.
The NECC considered whether to exercise negative discretion when determining
the achievement of targets, and determined that no negative discretion should be exercised. The Adjusted Net Sales of the Company in fiscal 2016 were $1,610.4 million which made the amount of the awards payable under the annual bonus plan 200% of
target.
Adjusted SG&A as a Percentage of Net Sales
Adjusted
SG&A as a Percentage of Net Sales (SG&A % Sales) means selling, general and administrative expenses as a percentage of net sales, subject to adjustment for certain limited matters, including the effects of acquisitions, divestitures,
extraordinary transactions such as mergers or spin-offs, and variations in the exchange rate between foreign currencies and budget exchange rate.
The threshold,
target and stretch achievement levels, and the percent payout at each level, were as follows:
|
|
|
|
|
|
|
FY16 Cash Bonus Plan Metrics
(25% of Bonus Target)
|
|
Threshold
50% Payout
|
|
Target
100% Payout
|
|
Stretch
200% Payout
|
Adjusted SG&A % Sales
|
|
21.30%
|
|
20.30%
|
|
19.80%
|
Bonuses indicated increase proportionately in 1/10th of 1% increments for final results between the goals indicated with maximum bonus at
stretch. No bonuses tied to performance are paid for results below the Threshold goal.
The NECC considered whether to exercise negative discretion when determining
the achievement of targets, and determined that no negative discretion should be exercised. The Adjusted SG&A % Sales of the Company in fiscal 2016 were 20.6% which made the amount of the awards payable under the annual bonus plan 84.6% of
target.
Adjusted Operating Profit
Adjusted Operating Profit means gross
profit less spend associated with A&P, R&D, SG&A, and amortization expense, subject to adjustment for certain limited matters, including the effects of
32
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
acquisitions, divestitures, extraordinary dividends, stock splits or stock dividends, recapitalizations, extraordinary transactions such as mergers or spin-offs, reorganizations, unusual or
non-recurring non-cash accounting impacts, costs associated with restructurings, and variations in the exchange rate between foreign currencies and budget exchange rate.
The threshold, target and stretch achievement levels, and the percent payout at each level, were as follows:
|
|
|
|
|
|
|
FY16 Cash Bonus Plan Metrics
(25% of bonus target)
|
|
Threshold
50% Payout
|
|
Target
100% Payout
|
|
Stretch
200% Payout
|
Adjusted Operating Profit
|
|
$206.70 million
|
|
$229.70 million
|
|
$241.20 million
|
Bonuses indicated increase proportionately in 1/10th of 1% increments for final results between the goals indicated with maximum bonus at
stretch. No bonuses tied to performance are paid for results below the Threshold goal.
The NECC considered whether to exercise negative discretion when determining
the achievement of targets, and determined that no negative discretion should be exercised. The Adjusted Operating Profit of the Company in fiscal 2016 was $256.3 million which made the amount of the awards payable under the annual bonus plan 200%
of target.
Adjusted Free Cash Flow
Adjusted Free Cash Flow means net
earnings plus depreciation and amortization plus share based payments plus changes in working capital plus changes in other assets and liabilities minus capital expenditures, subject to adjustment for certain limited matters, including the effects
of acquisitions, divestitures, or recapitalizations, extraordinary transactions such as mergers or spin-offs, reorganizations, unusual or non-recurring non-cash accounting impacts, and costs associated with events such as plant closings, sales of
facilities or operations, and business restructurings.
Working capital is measured at the beginning and the end of the relevant performance period, and consists of
(i) accounts receivables less the portion of accrued liabilities representing trade allowance, (ii) inventories, and (iii) accounts payable.
The threshold, target
and stretch achievement levels, and the percent payout at each level, were as follows:
|
|
|
|
|
|
|
FY16 Cash Bonus Plan Metrics
(25% of bonus target)
|
|
Threshold
50% Payout
|
|
Target
100% Payout
|
|
Stretch
200% Payout
|
Adjusted Free Cash Flow
|
|
$130.80 million
|
|
$145.30 million
|
|
$159.80 million
|
Bonuses indicated increase proportionately in 1/10th of 1% increments for final results between the goals indicated with maximum bonus at
stretch. No bonuses tied to performance are paid for results below the Threshold goal.
The NECC considered whether to exercise negative discretion when determining
the achievement of targets, and determined that no negative discretion should be exercised. The Adjusted Free Cash Flow of the Company in fiscal 2016 was $184.7 million which made the amount of the awards payable under the annual bonus plan 200% of
target.
Energizer Holdings, Inc.
2016 Proxy Statement
33
EXECUTIVE COMPENSATION
Equity Awards
Our 2015
Equity Incentive Plan authorizes the NECC to grant various types of equity awards. The NECC grants to key executives primarily restricted stock equivalent awards, with achievement of Company performance targets over three years as a condition to
vesting of the majority of the award, and continued employment with the Company over the same period as a condition to vesting of the remainder of the award. See
Executive CompensationPotential Payments Upon Termination of Change in
Control
. In November 2015, the NECC awarded three-year incentive awards with a performance-based component constituting approximately 70% of the restricted stock equivalents vesting at target achievement and a time-vesting component
constituting approximately 30% of the award value at target of the award.
Timing and Procedures for Grants in Fiscal 2016
Other than in exceptional cases, such as promotions or new hires, long-term incentive awards are granted in the first quarter of the fiscal year (October through
December), at the time when salary levels and bonus programs for the new fiscal year are also determined.
The size of equity awards for our named executive officers
granted in November 2015 was based in part upon benchmarked data from our peer group provided by Mercer, as compensation consultant to the NECC, valued on the date of grant. The size of awards also reflected other factors, such as officers
individual performance, current dilution rates, and the market run-rate for equity grants among our peer group. The number of restricted stock equivalents awarded in November 2015 was based on the corresponding grant date value of the restricted
stock equivalents. The restricted stock equivalent awards are stock-settled at the end of the three-year period, when they convert into unrestricted shares of our common stock if and to the extent that the vesting requirements are met. The number of
restricted stock equivalents granted to each named executive officer is shown in the
Grants of Plan-Based Awards Table
.
Our chief executive
officer makes a recommendation to the NECC for the number of restricted stock equivalents to be granted to each named executive officer (other than the chief executive officer), based on market data as well as the roles, responsibilities and
individual performance of each officer. With respect to awards to the chief executive officer, Mercer provides a range of potential awards to the NECC based on market comparisons. However, the NECC considers alternatives and determines the award
considering the competitive posture, our companys performance, returns to shareholders and experience and effectiveness of the chief executive officers leadership, as well as the input from Mercer.
Performance Awards
In November 2015, the NECC granted long-term equity
incentive awards to our executive officers. These awards potentially vest in November 2018 based on the achievement of two performance metrics:
|
|
|
Cumulative Adjusted Earnings per Share (50%)
|
|
|
|
Cumulative Free Cash Flow as a percentage of Adjusted Net Sales (50%)
|
The number of units granted to each named
executive officer is shown in the
Grants of Plan-Based Awards Table
. No vesting of performance based long-term incentive awards occurs for results below the Threshold goal.
34
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
Cumulative Adjusted Earnings per Share
Adjusted Cumulative Earnings per Share means the cumulative Diluted earnings per share (determined in accordance with Generally Accepted Accounting
Principles) as publicly reported by Energizer over the three year performance period, subject to adjustment for certain limited matters, including the effects of acquisitions, divestitures, extraordinary dividends, stock splits or stock dividends,
recapitalizations, extraordinary transactions such as mergers or spin-offs, reorganizations, unusual or non-recurring non-cash accounting impacts, and costs associated with events such as plant closings, sales of facilities or operations, and
business restructurings.
Cumulative Free Cash Flow as a Percentage of Adjusted Net Sales
Cumulative Free Cash Flow as a Percentage of Adjusted Net Sales (FCF % Sales) means free cash flow, defined as net earnings plus depreciation and amortization plus share
based payments plus changes in working capital plus changes in other assets and liabilities minus capital expenditures, as a percentage of net sales, subject to adjustment for certain limited matters, including the effects of acquisitions,
divestitures, or recapitalizations, extraordinary transactions such as mergers or spin-offs, reorganizations, unusual or non-recurring non-cash accounting impacts, and costs associated with events such as plant closings, sales of facilities or
operations, and business restructurings.
Working capital is measured at the beginning and the end of the relevant performance period, and consists of (i) accounts
receivables less the portion of accrued liabilities representing trade allowance, (ii) inventories, and (iii) accounts payable.
Executive Savings Investment
Plan
On July 1, 2015, we adopted an executive savings investment plan, our excess 401(k) plan, in which certain executive officers, including our named
executive officers, participate. Under the plan, amounts that would be contributed, either by an executive or by the Company on the executives behalf, to the Companys qualified defined contribution plan (the 401(k) plan) but
for limitations imposed by the IRS, will be credited to the non-qualified defined contribution executive savings investment plan. Details of the executive savings investment plan, including the contributions, earnings, and year-end balances, are set
forth in the
Non-Qualified Deferred Compensation Table
.
According to market data provided by Mercer, these types of benefits are generally
offered by our peer group described above, often with enhanced benefit formulas which we do not provide.
Deferred Compensation Plan
Our employees do not have the opportunity to defer portions of their salary and bonus compensation under the terms of our deferred compensation plan that provides
certain benefits to our directors, or to invest in the Energizer common stock unit fund within the deferred compensation plan. However, certain executives who were employed at our former parent company prior to the Spin-Off had their account
balances under our former parent companys deferred compensation plan transferred to our deferred compensation plan. Details of the deferred compensation program, including the contributions, earnings, and year-end balances, are set forth in
the
Non-Qualified Deferred Compensation Table
.
Severance and Other Benefits Following a Change of Control
We have not entered into employment agreements with our executives. However, our NECC approved an executive severance plan and change of control agreements with each of
our executive officers, as discussed under
Potential Payments upon Termination or Change of Control
to align with the market practice of utilizing pre-defined termination programs for NEOs.
Energizer Holdings, Inc.
2016 Proxy Statement
35
EXECUTIVE COMPENSATION
The change of control agreements are designed to provide executives with increased security in the event of a change of
control. The NECC annually reviews the cost and the terms of the agreements with input provided by Mercer. We believe that the retention value provided by the agreements, and the benefit to us when the executive is provided the opportunity to focus
on the interests of shareholders and not the executives own personal financial interests, outweighs the potential cost, given that:
|
|
|
such protections are common among companies of our size, and allow us to offer a competitive compensation package;
|
|
|
|
Mercer has advised that the aggregate projected cost of the agreements is at the lower end of prevailing practice;
|
|
|
|
such costs will only be triggered if the new controlling entity involuntarily terminates the impacted executives, or the executives resign for good reason, during the protected period;
|
|
|
|
the agreements include non-compete and non-solicitation covenants binding on the executives, which can provide significant benefit to the new controlling entity; and
|
|
|
|
the individuals with the agreements are carefully selected by the Board of Directors, and we believe they are critical to the process of evaluating or negotiating a potential change of control transaction or in the
operation of our business during the negotiations or integration process, so that their retention would be critical to the success of any such transaction.
|
We do not permit tax gross-up payments relating to severance payments for change of control employment agreements entered into with our executive officers.
A description of the projected cost, if a change of control were to have occurred on the last day of fiscal 2016 and all of the named executive officers were terminated
on that date, is provided under
Potential Payments upon Termination or Change of Control
.
Perquisites
We offer a limited number of perquisites for our executive officers. The primary perquisite or executive benefit consists of the executive financial planning program,
which provides reimbursement for 80% of the costs incurred for qualifying financial planning, legal, and tax preparation services up to a maximum of $8,000 in the first calendar year and $6,000 in subsequent calendar years. This benefit partially
offsets costs incurred by our executive officers in connection with their regulatory compliance obligations as public company executives. We regularly review the benefits provided to our executives and make appropriate modifications based on peer
group analysis and the committees evaluation of the retentive value of these benefits.
Stock Ownership Requirements
Our stock ownership guidelines provide that the chief executive officer must maintain ownership of our common stock with a value of at least five times his base salary,
and other executive officers must maintain common stock ownership with a value of at least three times their base salaries. Newly appointed executive officers are required to retain at least fifty percent (50%) of vesting restricted stock until they
become compliant and are given a period of five years to attain full compliance with the guidelines.
For purposes of this determination, stock ownership includes
shares of our common stock which are owned directly or by family members residing with the executive or by family trusts, as well as vested options, vested and deferred restricted stock equivalents and unvested restricted stock equivalents (other
than stock equivalents subject to achievement of performance targets). As of September 30, 2016, each of our named executive officers was in compliance with the guidelines.
36
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
Trading in Energizer Stock
Under our insider trading policy, directors, officers and employees or their designees are prohibited from engaging in speculative trading, hedging or pledging
transactions in Energizer securities, including prohibitions on:
|
|
|
investing or trading in market-traded options on Energizer securitiesi.e., puts and calls; or
|
|
|
|
purchasing financial instruments (including prepaid variable forward contracts, equity swaps, collars, and exchange funds) that are designed to profit from, hedge or offset any change in the market value of equity
securities (1) granted to the director, officer or employee by Energizer as part of the compensation of the employee or member of the Board of Directors; or (2) held, directly or indirectly, by the director, officer or employee; or
|
|
|
|
purchasing Energizer securities on margin, pledging Energizer securities, or holding Energizer securities in margin accounts; or
|
|
|
|
engaging in short-sales of Energizer securitiesi.e., selling Energizer stock not owned at the time of the sale; or
|
|
|
|
speculating on relatively short-term price movements of Energizer securitiesi.e., engage in a purchase and sale of Energizer stock within a short period of time.
|
The policy prohibits the transfer of funds into or out of Energizer stock equivalent funds in Energizers benefit plans while in possession or aware of material
non-public information, or engaging in any other transaction involving Energizer securities, including pledging, that suggests the misuse of information that is unavailable to the general public.
Tax Deductibility Limits on Executive Compensation
Section 162(m) of the
Internal Revenue Code and the regulations adopted thereunder limit the deductibility of non-qualifying compensation in excess of $1,000,000 paid to covered employees. However, these regulations exempt qualifying performance-based compensation from
the deduction limit if certain requirements are met. The NECCs policy is to maximize the tax deductibility of executive compensation without compromising the essential framework of the existing total compensation program. The NECC may elect to
forgo deductibility for federal income tax purposes if such action is, in the opinion of the NECC, necessary or appropriate to further the goals of the Companys executive compensation program, or otherwise is in the Companys best
interests.
Results of 2016 Advisory Vote to Approve Executive Compensation
At our 2016 Annual Meeting of shareholders, we asked our shareholders to vote to approve, on an advisory basis, our fiscal year 2015 compensation paid to our named
executive officers, commonly referred to as a say-on-pay vote. Our shareholders overwhelmingly approved compensation to our named executive officers, with over 96% of votes cast in favor of our say-on-pay resolution. We value this
positive endorsement by our shareholders of our executive compensation policies and believe that the outcome signals our shareholders support of our compensation program. As a result, we continued our overall approach to compensation for
fiscal 2016 by aligning pay with achievement of short- and long-term financial and strategic objectives, while providing a competitive level of compensation which is needed to recruit, retain and motivate talented executives. We value the opinions
of our shareholders and will continue to consider the results from this years and future advisory votes on executive compensation, as well as feedback received throughout the year, when making compensation decisions for our named executive
officers.
Energizer Holdings, Inc.
2016 Proxy Statement
37
EXECUTIVE COMPENSATION
Implementation of the Compensation Program
Our Board of Directors has delegated authority to the NECC to approve all compensation and benefits for our executive officers. The NECC sets executive salaries and
bonuses, reviews executive benefit programs, including change of control severance agreements, and grants cash bonus awards to our executive officers under our cash bonus program, as well as equity awards to executives under our 2015 Equity
Incentive Plan.
To assist the NECC in evaluating our executive and director compensation programs on a competitive market basis, the committee has directly retained
an outside consultant, Mercer, which is asked to:
|
|
|
provide comparative market data for our peer group (and other companies, as needed) with respect to the compensation of the named executive officers and the directors;
|
|
|
|
analyze our compensation and benefit programs relative to our peer group; and
|
|
|
|
advise the committee on trends in compensation and governance practices and on management proposals with respect to executive compensation.
|
The NECC has reviewed the independence of Mercer and has determined that Mercer has no conflicts of interest. In particular:
|
|
|
services provided to the Company by Mercer do not constitute a meaningful percentage of Mercers total revenues;
|
|
|
|
the committee has sole authority to retain or replace Mercer in its role as its consultant; and
|
|
|
|
the committee regularly reviews the performance and independence of Mercer.
|
During fiscal 2016, the aggregate fees paid
to Mercer for services related to executive compensation were approximately $161,842. In fiscal 2016, Mercer and its Marsh & McLennan affiliates were also retained by our management to provide services unrelated to executive compensation,
including providing advice regarding our global pension programs in the areas of compliance, administration and funding and global compensation consulting and benchmarking below the Executive Officer level. The aggregate fees paid for those other
services in fiscal 2016 were approximately $1,761,258. The NECC and the board did not review or approve the other services provided to management by Mercer and its Marsh & McLennan affiliates, as those services were approved by our management in
the normal course of business.
We have been advised by Mercer that the reporting relationship and compensation of the Mercer consultants who perform executive
compensation consulting services for the NECC is separate from, and is not determined by reference to, Mercers or Marsh & McLennans other lines of business or their other work for us.
A representative of Mercer attends committee meetings and serves as a resource to the NECC on executive and director compensation matters. Additionally, to encourage
independent review and discussion of executive compensation matters, the committee meets with Mercer in executive session.
38
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
COMPENSATION POLICIES AND PRACTICES AS THEY RELATE TO RISK MANAGEMENT
As stated above under
Corporate Governance, Risk Oversight and Director IndependenceDetermining Executive Compensation
as part of its
responsibilities, the Nominating and Executive Compensation Committee annually reviews the Companys compensation policies and practices for all employees, including executive officers, to determine whether, in its judgment, our compensation
programs encourage risk-taking likely to have a material adverse effect on the Company. In particular, there are several design features of those programs that the committee believes reduces the likelihood of excessive risk-taking:
|
|
|
the executive compensation program design provides a balanced mix of cash and equity, annual and longer-term incentives;
|
|
|
|
for the executive compensation program, maximum payout levels for bonuses and performance awards are capped;
|
|
|
|
multiple performance metrics are utilized to determine payouts under short-term and long-term incentive programs;
|
|
|
|
the Company does not grant stock options on a regular basis;
|
|
|
|
executive officers are subject to share ownership and retention guidelines;
|
|
|
|
the company has adopted anti-hedging and anti-pledging policies; and
|
|
|
|
the company has adopted a clawback policy related to incentive compensation earned by our named executive officers.
|
The
committee determined that, for all employees, the Companys compensation programs do not encourage excessive risk and instead encourage behavior that supports sustainable value creation.
NOMINATING AND EXECUTIVE COMPENSATION COMMITTEE REPORT
The Nominating and Executive Compensation Committee of the Companys Board of Directors consists entirely of non-employee directors that are independent under the
NYSE listing standards. The Committee has reviewed and discussed the Companys Compensation Discussion and Analysis with management. Based on these reviews and discussions, the Committee recommended to the Board of Directors that the
Compensation Discussion and Analysis be included in this Proxy Statement and in the Companys Annual Report on Form 10-K for the fiscal year ended September 30, 2016.
|
|
|
James C. JohnsonChairman
Cynthia J. Brinkley
|
|
Bill G. Armstrong
Kevin J. Hunt
|
No portion of this Nominating and Executive Compensation Committee Report shall be deemed to be incorporated by reference into any
filing under the Securities Act, the Exchange Act, or through any general statement incorporating by reference in its entirety the Proxy Statement in which this report appears, except to the extent that the Company specifically incorporates this
report or a portion of it by reference. In addition, this report shall not be deemed to be filed under either the Securities Act or the Exchange Act.
Energizer Holdings, Inc.
2016 Proxy Statement
39
EXECUTIVE COMPENSATION
EQUITY COMPENSATION PLAN INFORMATION
The following table gives information about the Companys common stock that may be issued upon the exercise of options, warrants and rights under all of the
Companys existing compensation plans as of September 30, 2016:
|
|
|
|
|
|
|
|
|
|
|
Plan Category
|
|
(1)
Number of
Securities
to be Issued upon
Exercise
of
Outstanding
Options,
Warrants and Rights
|
|
|
(2)
Weighted-Average
Exercise Price of
Outstanding
Options,
Warrants and Rights
|
|
(3)
Number of
Securities
Remaining Available
for Future Issuance
Under
Equity
Compensation
Plans
(Excluding
Securities Reflected
in
Column (1),
and as Noted
Below)
|
|
Equity
compensation plans approved by security holders
|
|
|
1,666,966
|
|
|
N/A
|
|
|
5,749,928
|
|
Equity compensation plans not approved
by security holders
|
|
|
None
|
|
|
N/A
|
|
|
None
|
|
Total
|
|
|
1,666,966
|
|
|
N/A
|
|
|
5,749,928
|
|
(1)
|
The number of securities to be issued upon exercise of outstanding options, warrants and rights shown above, as of September 30, 2016, includes 1,666,966 restricted stock equivalents which have been granted under
the terms of the Energizer Holdings, Inc. Equity Incentive Plan (including our former parent company stock awards reissued and converted into Energizer stock awards in connection with the Spin-Off). As of November 16, 2016, of the outstanding stock
equivalents granted, 504,180 have vested and converted into outstanding shares of our common stock. An additional 413,759 restricted stock equivalents have been granted. Of the aggregate, 1,042,683 outstanding stock equivalents under our equity
incentive plan (i) vest over varying periods of time following grant, and at that time, convert, on a one-for-one basis, into shares of
|
|
common stock, or (ii) have already vested but conversion into shares of our common stock has been deferred, at the election of the recipient, until retirement or termination of employment.
An additional 533,862 stock equivalents granted at target will vest only upon achievement of three-year performance measures.
|
(2)
|
The weighted average exercise price does not take into account securities which will be issued upon conversion of outstanding restricted stock equivalents.
|
(3)
|
This number only reflects securities available under the Equity Incentive Plan. Under the terms of that plan, any awards other than options, phantom stock options or stock appreciation rights are to be counted against
the reserve available for issuance in a 2 to 1 ratio.
|
40
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name and Principal Position
|
|
Year
|
|
|
Salary
|
|
|
Bonus
(1)
|
|
|
Stock
Awards
(2)
|
|
|
Option
Awards
|
|
|
Non-Equity
Incentive
Plan Comp.
(1)(3)
|
|
|
Change in
Pension Value
and
Nonqualified
Deferred
Comp.
Earnings
(4)
|
|
|
All
Other
Compensation
(5)
|
|
|
Total
|
|
Alan R. Hoskins
|
|
|
2016
|
|
|
$
|
923,625
|
|
|
|
$0
|
|
|
$
|
3,600,024
|
|
|
|
$0
|
|
|
$
|
1,586,561
|
|
|
$
|
68,875
|
|
|
$
|
125,028
|
|
|
$
|
6,304,113
|
|
President & Chief
|
|
|
2015
|
|
|
$
|
650,007
|
|
|
|
$0
|
|
|
$
|
7,825,107
|
|
|
|
$0
|
|
|
$
|
789,660
|
|
|
$
|
68,371
|
|
|
$
|
67,616
|
|
|
$
|
9,400,761
|
|
Executive Officer
|
|
|
2014
|
|
|
$
|
458,350
|
|
|
|
$0
|
|
|
$
|
830,001
|
|
|
|
$0
|
|
|
$
|
613,425
|
|
|
$
|
155,681
|
|
|
$
|
65,710
|
|
|
$
|
2,123,167
|
|
|
|
|
|
|
|
|
|
|
|
Brian K. Hamm
|
|
|
2016
|
|
|
$
|
539,438
|
|
|
|
$0
|
|
|
$
|
1,312,501
|
|
|
|
$0
|
|
|
$
|
740,395
|
|
|
|
5,248
|
|
|
$
|
59,466
|
|
|
$
|
2,657,048
|
|
Executive Vice President &
|
|
|
2015
|
|
|
$
|
367,503
|
|
|
|
$0
|
|
|
$
|
2,911,288
|
|
|
|
$0
|
|
|
$
|
611,647
|
|
|
$
|
5,836
|
|
|
$
|
46,869
|
|
|
$
|
3,943,143
|
|
Chief Financial Officer
|
|
|
2014
|
|
|
$
|
300,633
|
|
|
|
$0
|
|
|
$
|
363,209
|
|
|
|
$0
|
|
|
$
|
299,650
|
|
|
$
|
26,724
|
|
|
$
|
39,930
|
|
|
$
|
1,030,146
|
|
|
|
|
|
|
|
|
|
|
|
Mark S. LaVigne
|
|
|
2016
|
|
|
$
|
539,438
|
|
|
|
$0
|
|
|
$
|
1,312,501
|
|
|
|
$0
|
|
|
$
|
740,395
|
|
|
|
4,327
|
|
|
$
|
67,802
|
|
|
$
|
2,664,463
|
|
Executive Vice President
|
|
|
2015
|
|
|
$
|
461,246
|
|
|
|
$0
|
|
|
$
|
3,633,178
|
|
|
|
$0
|
|
|
$
|
1,070,905
|
|
|
$
|
4,811
|
|
|
$
|
63,037
|
|
|
$
|
5,233,177
|
|
& Chief Operating Officer
|
|
|
2014
|
|
|
$
|
436,665
|
|
|
|
$0
|
|
|
$
|
778,159
|
|
|
|
$0
|
|
|
$
|
446,858
|
|
|
$
|
32,540
|
|
|
$
|
56,881
|
|
|
$
|
1,751,103
|
|
|
|
|
|
|
|
|
|
|
|
Gregory T. Kinder
|
|
|
2016
|
|
|
$
|
416,250
|
|
|
|
$0
|
|
|
$
|
900,006
|
|
|
|
$0
|
|
|
$
|
429,244
|
|
|
|
882
|
|
|
$
|
41,656
|
|
|
$
|
1,788,038
|
|
Executive Vice President &
|
|
|
2015
|
|
|
$
|
375,182
|
|
|
|
$0
|
|
|
$
|
1,325,781
|
|
|
|
$0
|
|
|
$
|
614,538
|
|
|
$
|
980
|
|
|
$
|
20,569
|
|
|
$
|
2,337,050
|
|
Chief Supply Chain Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Emily K. Boss
|
|
|
2016
|
|
|
$
|
411,000
|
|
|
|
$0
|
|
|
$
|
500,057
|
|
|
|
$0
|
|
|
$
|
423,083
|
|
|
$
|
149
|
|
|
$
|
37,502
|
|
|
$
|
1,371,791
|
|
Vice President & General
Counsel
|
|
|
2015
|
|
|
$
|
295,000
|
|
|
|
$0
|
|
|
$
|
1,275,806
|
|
|
|
$0
|
|
|
$
|
578,918
|
|
|
$
|
166
|
|
|
$
|
32,052
|
|
|
$
|
2,181,942
|
|
(1)
|
All awards under our annual cash bonus program are based upon achievement of company performance measures established at the beginning of a performance period. Consequently, the value of all bonuses earned during the
fiscal year have been included in the
Non-Equity Incentive Plan Compensation
column of this table. See footnote (3) below.
|
(2)
|
The amounts listed in the column include a performance-based restricted stock equivalent grant awarded in November 2015 to our named executive officers. The value of the performance-based award reflects the most
probable outcome award value at the date of its grant in accordance with FASB ASC Section 718. The Company records estimated expense for the performance-based awards based on target achievement for the three-year period unless evidence exists
that a different outcome is likely to occur. Following is the maximum award value, if paid, for the performance-based awards granted in fiscal 2016, based on the grant date fair value, A. Hoskins$5,040,004; B. Hamm$1,837,501;
M. LaVigne$1,837,501; G. Kinder$1,260,001 and E. Boss$700,050.
|
The grant date fair value of the performance- based awards included in the table is as follows:
|
|
|
Mr. Hoskins, $2,520,002
|
The amounts listed in the column also include equity awards granted by our NECC
in November 2015 that vest over three years assuming that the officer remains employed with the company. The award was granted using grant date fair value of the awards as follows:
|
|
|
Mr. Hoskins, $1,080,022
|
Energizer Holdings, Inc.
2016 Proxy Statement
41
EXECUTIVE COMPENSATION
(3)
|
The amounts reported in this column reflect bonuses earned by the named executive officers during the fiscal year under the applicable annual cash bonus program, as described in our
Compensation Discussion and
Analysis.
|
(4)
|
The amounts reported in this column consist of aggregate changes in the actuarial present value of accumulated benefits under the applicable retirement plan and the supplemental executive retirement plan, our pension
restoration plan, which are the applicable defined benefit pension plans described in the narrative to the
Pension Benefits Table.
To the extent that payments under the qualified retirement plan exceed limitations imposed by the
IRS, the excess will be paid under the terms of the non-qualified supplemental executive retirement plan.
|
(5)
|
The amounts reported in this column with respect to fiscal 2016 consist of the following:
|
|
(i)
|
Company matching contributions or accruals in our 401(k) plan and executive savings investment plan:
|
These amounts include benefits which were accrued by the named executive
officers in our executive savings investment plan in lieu of the pension plus match account in our retirement plan (as described in the narrative to the
Pension Benefits Table
) due to certain limits imposed by the IRC on accruals
in our retirement plan.
|
(ii)
|
The incremental cost to the company of the following perquisites provided to the named executive officers:
|
Executive Financial Planning Program
. We reimburse the executives for 80% of the cost of personal financial advisory
services, up to certain annual maximums. During fiscal 2016, the following reimbursement payments were made:
Executive Excess Liability Plan
. We pay the
annual premium for a group policy providing each executive with personal excess liability coverage in excess of his or her primary personal liability insurance, the cost of which is borne by each executive. During the first quarter of fiscal 2016,
we paid $696 in premiums for each of the named executive officers. Effective January 1, 2016, the Executive Excess Liability Plan was eliminated.
The above list of perquisites does not include any contributions made by our charitable foundation which may have been made at the request of any of the
named executive officers. The directors of that foundation, all of whom are employees of the Company, review requests for contributions to charitable organizations from employees, officers and the community at large, and, in their sole discretion,
authorize contributions in accordance with the purposes of the foundation. Officers are also eligible to participate in the charitable foundation matching gift program, which is generally available to U.S. employees. Under this program, the
foundation matches 100% of charitable donations of a minimum of $25 made to eligible charities, up to a maximum of $5,000 per year for each individual.
Dividend Equivalent Payments Not Included
. Holders of restricted stock equivalents have the right to receive cash dividend
equivalent payments on restricted stock equivalents but only if the underlying restricted stock equivalents vest. The amounts of such dividends are reflected in the closing price of Energizer Holdings, Inc. common stock on the NYSE (or the common
stock of our former parent company prior to the Spin-Off) and are included in the grant date fair value for the restricted stock equivalent grants.
42
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
GRANTS OF PLAN-BASED AWARDS
Awards to the named executive officers, and to other key executives, were made in fiscal 2016 under two separate plans or programs:
|
|
|
potential cash awards under our annual cash bonus program, dependent upon achievement of performance measures established at the beginning of the fiscal year, as described in more detail in
Compensation
Discussion and AnalysisElements of CompensationIncentive ProgramsFiscal 2016 Bonus Program
; and
|
|
|
|
three-year restricted stock equivalent awards under the terms of our equity incentive plan, which include a performance component and a time-vesting component, as described in more detail in
Compensation
Discussion and AnalysisElements of CompensationIncentive ProgramsEquity Awards
.
|
GRANTS OF PLAN-BASED
AWARDS TABLE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Estimated Future
Payouts
Under Non-Equity
Incentive
Plan Awards ($)
|
|
|
Estimated Future
Payouts
Under Equity
Incentive Plan
Awards (#)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Type of Award
|
|
Grant
Date
|
|
|
Committee
Action
Date
|
|
|
Threshold
|
|
|
Target
|
|
|
Maximum
|
|
|
Threshold
|
|
|
Target
|
|
|
Maximum
|
|
|
All Other
Stock
Awards:
Number of
Shares of
Stock(#)
|
|
|
All Other
Option
Awards:
Number of
Shares
Underlying
Options (#)
|
|
|
Exercise
or
Base
Price
of
Option
Awards
($/Sh)
|
|
|
Grant
Date
Fair
Value
of Stock
and Option
Awards(4)
|
|
A.R. Hoskins
|
|
Bonus: Annl.Perf.(1)
|
|
|
11/16/15
|
|
|
|
11/16/15
|
|
|
|
$463,500
|
|
|
|
$ 927,000
|
|
|
|
$ 1,854,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Perf. Award(2)
|
|
|
11/16/15
|
|
|
|
11/16/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
33,744
|
|
|
|
67,488
|
|
|
|
134,976
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$2,520,002
|
|
|
|
Perf. Awd.: Time Based(3)
|
|
|
11/16/15
|
|
|
|
11/16/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
28,924
|
|
|
|
|
|
|
|
|
|
|
|
$1,080,022
|
|
B.K. Hamm
|
|
Bonus: Annl.Perf.(1)
|
|
|
11/16/15
|
|
|
|
11/16/15
|
|
|
|
$216,300
|
|
|
|
$432,600
|
|
|
|
$865,200
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Perf. Award(2)
|
|
|
11/16/15
|
|
|
|
11/16/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,303
|
|
|
|
24,605
|
|
|
|
49,210
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$918,751
|
|
|
|
Perf. Awd.: Time Based(3)
|
|
|
11/16/15
|
|
|
|
11/16/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,545
|
|
|
|
|
|
|
|
|
|
|
|
$393,750
|
|
M.S. LaVigne
|
|
Bonus: Annl.Perf.(1)
|
|
|
11/16/15
|
|
|
|
11/16/15
|
|
|
|
$216,300
|
|
|
|
$432,600
|
|
|
|
$865,200
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Perf. Award(2)
|
|
|
11/16/15
|
|
|
|
11/16/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,303
|
|
|
|
24,605
|
|
|
|
49,210
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$918,751
|
|
|
|
Perf. Awd: Time Based(3)
|
|
|
11/16/15
|
|
|
|
11/16/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,545
|
|
|
|
|
|
|
|
|
|
|
|
$393,750
|
|
G.T. Kinder
|
|
Bonus: Annl.Perf.(1)
|
|
|
11/16/15
|
|
|
|
11/16/15
|
|
|
|
$125,400
|
|
|
|
$250,800
|
|
|
|
$501,600
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Perf. Award(2)
|
|
|
11/16/15
|
|
|
|
11/16/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,436
|
|
|
|
16,872
|
|
|
|
33,744
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$630,000
|
|
|
|
Perf. Awd. Time Based(3)
|
|
|
11/16/15
|
|
|
|
11/16/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,231
|
|
|
|
|
|
|
|
|
|
|
|
$270,006
|
|
E.K. Boss
|
|
Bonus: Annl.Perf.(1)
|
|
|
11/16/15
|
|
|
|
11/16/15
|
|
|
|
$123,600
|
|
|
|
$247,200
|
|
|
|
$494,400
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Perf. Award(2)
|
|
|
11/16/15
|
|
|
|
11/16/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,687
|
|
|
|
9,374
|
|
|
|
18,748
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$350,025
|
|
|
|
Perf. Awd.: Time Based(3)
|
|
|
11/16/15
|
|
|
|
11/16/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,018
|
|
|
|
|
|
|
|
|
|
|
|
$150,032
|
|
(1)
|
These amounts represent the estimated possible payouts of annual cash awards for fiscal year 2016 under our annual cash bonus program for each of our named executive officers. The actual amounts earned under the annual
cash bonus program for fiscal year 2016 are disclosed in the
Summary Compensation Table
above as part of the column entitled
Non-Equity Incentive Plan Compensation
.
|
(2)
|
Vesting of these restricted stock equivalents (the performance-linked component), awarded under the three-year performance awards, is subject to achievement of pre-established performance criteria for cumulative
earnings per share and cumulative free cash flow as a percentage of net sales over the three year period commencing October 1, 2015, the beginning of
|
|
our fiscal 2016. See
Compensation Discussion and
Analysis-Elements of Compensation-Incentive Programs-Equity Awards
.
|
(3)
|
These restricted stock equivalents (the time-vesting component) will vest three years from the date of grant, if the officer remains employed with us at that time. The value of the amount calculated in accordance with
accounting guidance is included in the
Stock Awards
column of the
Summary Compensation Table
.
|
(4)
|
These amounts represent the grant date fair value calculated in accordance with FASB ASC Section 718, excluding forfeitures
assumptions. For the three-year performance awards, the value includes the grant date fair value of the awards computed in accordance with
|
Energizer Holdings, Inc.
2016 Proxy Statement
43
EXECUTIVE COMPENSATION
|
FASB ASC Section 718, applying the same valuation model and assumptions applied for financial reporting purposes, excluding forfeiture assumptions. These amounts may not correspond to the actual
value realized by the named executive officers.
|
|
For the three-year time-vesting awards, these amounts represent the grant date fair value calculated in accordance with FASB ASC Section 718, excluding forfeiture assumptions. The value includes 100% of such
awards, with no reduction for potential forfeiture.
|
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END
The following types of equity awards have been granted to the named executive officers, and remain unvested as of
September 30, 2016.
|
|
Restricted stock equivalents granted by our former parent and converted into Energizer awards in connection with the Spin-Off that vest in two and three years from the grant date and at vesting convert into
non-restricted shares of our common stock which will then be issued to the officer. Vesting of restricted stock equivalents will accelerate, however, upon death, disability and upon a change of control of the Company. A portion will also vest upon
voluntary retirement if the awards have been held for at least twelve months and the officer is age 55 with at least 10 years of service, including service with our former parent prior to Spin-Off. Unvested restricted stock equivalent awards are
included under
Stock AwardsNumber of Shares or Units of Stock That Have Not Vested
, in the table below. To preserve the aggregate value of such converted award immediately before and immediately after the Spin-Off, the
number of shares of Energizer common stock subject to each converted award was adjusted. The awards granted by our former parent in November 2013 that would have vested based on performance criteria in November 2016 were
|
|
|
converted at target to time-based awards that vest in November 2016.
|
|
|
Restricted stock equivalents, the vesting of which is subject to the achievement of performance-linked and time-vesting conditions over a three year period, as described in
Compensation Discussion and
AnalysisElements of CompensationIncentive ProgramsEquity Awards
. The performance-based awards have similar terms and vest upon achievement of cumulative adjusted earnings per share and cumulative adjusted free cash flow
as a percentage of sales goals. See
Compensation Discussion and AnalysisElements of CompensationIncentive ProgramsEquity Awards
.
|
|
|
Special one-time restricted stock equivalents granted by Energizer that will vest ratably on each of the five anniversaries from the date of grant. Vesting of all of the restricted stock equivalents will accelerate,
however, upon death, disability and upon a change of control of the Company. A portion will also vest upon voluntary retirement if the awards have been held for at least twelve months and the officer is age 55 with at least 10 years of service and
upon involuntary termination (other than for cause).
|
44
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END
The following table and footnotes set forth information regarding outstanding restricted stock equivalent awards as of September 30, 2016 for the named executive
officers. The market value of shares that have not vested was determined by multiplying $49.96, the closing market price of the Companys stock on September 30, 2016, the last trading day of fiscal 2016, by the number of shares.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Awards (1)
|
|
Name
|
|
Number of
Shares or
Units of
Stock That
Have Not
Vested (#)
|
|
|
Market Value
of Shares or
Units of
Stock
That
Have Not
Vested
($)
|
|
|
Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
(#)(2)
|
|
|
Equity
Incentive
Plan
Awards:
Market
or
Payout Value
of Unearned
Shares, Units
or Other
Rights
That Have
Not Vested ($)
|
|
A. R. Hoskins
|
|
|
242,742(3)
|
|
|
$
|
12,127,390
|
|
|
|
67,488
|
(8)
|
|
$
|
3,371,700
|
|
B. K. Hamm
|
|
|
92,359(4)
|
|
|
$
|
4,614,256
|
|
|
|
24,605
|
(9)
|
|
$
|
1,229,266
|
|
M. S. LaVigne
|
|
|
126,170(5)
|
|
|
$
|
6,303,453
|
|
|
|
24,605
|
(10)
|
|
$
|
1,229,266
|
|
G. T. Kinder
|
|
|
52,721(6)
|
|
|
$
|
2,633,941
|
|
|
|
16,872
|
(11)
|
|
$
|
842,925
|
|
E. K. Boss
|
|
|
44,360(7)
|
|
|
$
|
2,216,226
|
|
|
|
9,374
|
(12)
|
|
$
|
468,325
|
|
|
(1)
|
All outstanding equity awards of our named executive officers previously granted by our former parent company were converted into comparable awards of Energizer upon the completion of the Spin-Off at a stock price based
on the five day volume weighted trading price of our former parent companys stock pre-spin and our stock post-spin.
|
|
|
The performance awards granted by our former parent company in November 2013 that would have vested based on performance criteria in November 2016 were converted at target to time-based awards that vest in November 2016
due to the difficulty of calculating the outcomes of the performance criteria beyond the Spin-Off date.
|
|
(2)
|
The amount of the awards is based on payout assuming results meet the target performance level at the conclusion of the performance period.
|
|
(3)
|
Of this total for Mr. Hoskins,
|
|
|
|
29,530 restricted stock equivalents granted 11/6/13 of which 7,381 vested on 11/6/16 and 22,149 vested on 11/9/16;
|
|
|
|
23,349 restricted stock equivalents granted 11/13/14 vested on 11/13/16;
|
|
|
|
160,939 restricted stock equivalents granted 7/8/15 vest ratably on each of the first five anniversaries of the grant date; and
|
|
|
|
28,924 restricted stock equivalents granted 11/16/15 vest on 11/16/18.
|
|
(4)
|
Of this total for Mr. Hamm,
|
|
|
|
12,922 restricted stock equivalents granted 11/6/13 of which 3,231 vested on 11/6/16 and 9,691 vested on 11/9/16;
|
|
|
|
10,216 restricted stock equivalents granted 11/13/14 vested on 11/13/16;
|
|
|
|
58,676 restricted stock equivalents granted 7/8/15 vest ratably on each of the first five anniversaries of the grant date; and
|
|
|
|
10,545 restricted stock equivalents granted 11/16/15 vest on 11/16/18.
|
|
(5)
|
Of this total for Mr. LaVigne,
|
|
|
|
27,686 restricted stock equivalents granted 11/6/13 of which 6,920 vested on 11/6/16 and 20,766 vested on 11/9/16;
|
|
|
|
21,887 restricted stock equivalents granted 11/13/14 vested on 11/13/16;
|
|
|
|
66,052 restricted stock equivalents granted 7/8/15 vest ratably on each of the first five anniversaries of the grant date; and
|
Energizer Holdings, Inc.
2016 Proxy Statement
45
EXECUTIVE COMPENSATION
|
|
|
10,545 restricted stock equivalents granted 11/16/15 vest on 11/16/18.
|
|
(6)
|
Of this total for Mr. Kinder,
|
|
|
|
12,922 restricted stock equivalents granted 11/6/13 of which 3,231 vested on 11/6/16 and 9,691 vested on 11/9/16;
|
|
|
|
10,216 restricted stock equivalents granted 11/13/14 vested on 11/13/16;
|
|
|
|
22,352 restricted stock equivalents granted 7/8/15 vest ratably on each of the first five anniversaries of the grant date; and
|
|
|
|
7,231 restricted stock equivalents granted 11/16/15 vest on 11/16/18.
|
|
(7)
|
Of this total for Ms. Boss,
|
|
|
|
9,233 restricted stock equivalents granted 11/6/13 of which 2,309 vested on 11/6/16 and 6,924 vested on 11/9/16;
|
|
|
|
8,757 restricted stock equivalents granted 11/13/14 vested on 11/13/16;
|
|
|
|
22,352 restricted stock equivalents granted 7/8/15 vest ratably on each of the first five anniversaries of the grant date; and
|
|
|
|
4,018 restricted stock equivalents granted 11/16/15 vest on 11/16/18.
|
|
(8)
|
Of this total for Mr. Hoskins,
|
|
|
|
67,488 restricted stock equivalents represent the performance-linked component of performance awards granted 11/16/15.
|
|
(9)
|
Of this total for Mr. Hamm,
|
|
|
|
24,605 restricted stock equivalents represent the performance-linked component of performance awards granted 11/16/15.
|
|
(10)
|
Of this total for Mr. LaVigne,
|
|
|
|
24,605 restricted stock equivalents represent the performance-linked component of performance awards granted 11/16/15.
|
|
(11)
|
Of this total for Mr. Kinder,
|
|
|
|
16,872 restricted stock equivalents represent the performance-linked component of performance awards granted 11/16/15.
|
|
(12)
|
Of this total for Ms. Boss,
|
|
|
|
9,374 restricted stock equivalents represent the performance-linked component of performance awards granted 11/16/15.
|
46
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
OPTION EXERCISES AND STOCK VESTED
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Awards
|
Name
|
|
Number of Shares
Acquired on Vesting
(1)
|
|
Value Realized on
Vesting
($)
|
A. R. Hoskins
|
|
|
|
57,233
|
|
|
|
$
|
2,731,176
|
|
B. K. Hamm
|
|
|
|
22,107
|
|
|
|
$
|
1,047,024
|
|
M. S. LaVigne
|
|
|
|
31,385
|
|
|
|
$
|
1,447,245
|
|
G. T. Kinder
|
|
|
|
12,899
|
|
|
|
$
|
583,920
|
|
E. K.
Boss
|
|
|
|
5,589
|
|
|
|
$
|
281,797
|
|
(1)
|
In fiscal 2016, the time-based restricted stock equivalents granted to each of the officers by our former parent company in fiscal 2013 vested in accordance with the terms of the awards.
|
|
In fiscal 2016, 20% of the time-based restricted stock equivalents granted to each of the officers at the time of our Spin-Off from our former parent company vested in accordance with the terms of the awards.
|
Energizer Holdings, Inc.
2016 Proxy Statement
47
EXECUTIVE COMPENSATION
PENSION BENEFITS
Energizer established a new retirement plan that acquired the assets and assumed the liabilities of our former parents plans in connection with the Spin-Off. Prior
to January 1, 2014, our former parent companys retirement plan covered essentially all U.S. employees of Energizer after they became eligible. As of December 31, 2013, which is the end of the first quarter of our former parent
companys fiscal 2014, the plans were frozen and future retirement service benefits are no longer accrued under this retirement program. The freeze includes both the qualified and non-qualified plans.
The Retirement Accumulation Account that was effective from January 1, 2010 to December 31, 2013, included the future retirement benefits of the participants
in our former parent companys qualified defined benefit pension plan, including the named executive officers, which were determined in accordance with a retirement accumulation formula. The participants received monthly credits equal to 6% of
their eligible benefit earnings for each month, which amounts were credited with monthly interest equal to the 30-year Treasury rate that is reset annually. Certain older, longer-tenured participants, including the named executive officers with age
and years of service totaling at least 60 but not more than 74 as of December 31, 2009, received an additional monthly credit equal to 2% of eligible benefit earnings. Participants receive credit for years of service with our former parent
company. Other older, longer-tenured participants with age and years of service totaling 75 or more as of December 31, 2009 received an additional monthly credit equal to 4% of their eligible benefit earnings. These transition credits were
available to eligible plan participants through 2013 (or, if earlier, their termination of employment with the Company).
The defined benefit plan has used the
following other benefit calculation formulas, all of which have been frozen as of the end of calendar year 2009:
|
|
|
Pension Equity
(PEP) benefit formula. Under PEP, an executive is entitled to a benefit (payable in lump sum or as a monthly annuity) based on five-year average annual earnings, which were multiplied by
pension equity credits earned with years of service. The benefit was subject to a three year vesting period. PEP was applied to Mr. Hoskins and Mr. Hamm.
|
|
|
|
PensionPlus Match Account
(PPMA). The PPMA generally provided a 325% match under our retirement plan to those participants who made an after-tax contribution of 1% of their annual earnings to our 401(k) plan. To
the extent an officers PPMA benefit was unavailable due to the IRC limits, the benefit was restored under our excess savings investment plan and not the pension restoration plan for executives. The benefit was generally subject to a three-year
vesting requirement. The PPMA benefit was available through the end of the calendar year 2009 for Mr. Hoskins and Mr. Hamm.
|
48
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
PENSION BENEFITS TABLE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Plan Name
|
|
Number of
Years Credited
Service
(1)
|
|
|
Present Value
of Accumulated
Benefit
($)(2)
|
|
|
Payments
During Last
Fiscal Year
($)
|
|
A.R. Hoskins
|
|
Energizer Retirement Plan
|
|
|
31
|
|
|
$
|
1,040,260
|
|
|
$
|
0
|
|
|
|
Supplemental Executive Retirement Plan
|
|
|
30
|
|
|
$
|
1,224,548
|
|
|
$
|
0
|
|
B.K. Hamm
|
|
Energizer Retirement Plan
|
|
|
6
|
|
|
$
|
135,603
|
|
|
$
|
0
|
|
|
|
Supplemental Executive Retirement Plan
|
|
|
6
|
|
|
$
|
54,961
|
|
|
$
|
0
|
|
M.S. LaVigne
|
|
Energizer Retirement Plan
|
|
|
4
|
|
|
$
|
79,386
|
|
|
$
|
0
|
|
|
|
Supplemental Executive Retirement Plan
|
|
|
4
|
|
|
$
|
77,733
|
|
|
$
|
0
|
|
G.T. Kinder
|
|
Energizer Retirement Plan
|
|
|
.5
|
|
|
$
|
26,176
|
|
|
$
|
0
|
|
|
|
Supplemental Executive Retirement Plan
|
|
|
.5
|
|
|
$
|
5,827
|
|
|
$
|
0
|
|
E.K. Boss
|
|
Energizer Retirement Plan
|
|
|
.25
|
|
|
$
|
5,414
|
|
|
$
|
0
|
|
(1)
|
The number of years of credited service reflects years of actual service. For Mr. Hoskins 14 of the years shown were with Edgewell, our former parent company, and the remainder were with Ralston Purina Company,
Edgewells former parent. In February of 2009, in order to reduce cash outlays and bolster the companys compliance with its debt covenants, the committee, on a one-time basis, suspended accrual of benefits for officers in the pension
|
|
restoration plan for the calendar year, and in lieu of those and other benefits, Mr. Hoskins was granted a 2009 performance award.
|
(2)
|
Based on age, benefits are available without reduction. Assumptions utilized in the valuations are set forth in Note 12, Pension Plans of the Notes to Consolidated Financial Statements of our Annual Report
on Form 10-K for year ended September 30, 2016.
|
NON-QUALIFIED DEFERRED COMPENSATION
We have adopted several plans or arrangements that provide for the deferral of compensation on a basis that is not tax-qualified.
Deferred Compensation Plan
Under the terms of our deferred compensation plan, an unfunded, non-qualified plan that assumed the liabilities under our former parents plan in connection with
the Spin-Off, prior to January 1, 2013, executives could elect to have up to 100% of their annual cash bonus deferred until their retirement or other termination of employment, or for a shorter, three-year period (at the executives
election, in advance). All funds are invested in the Prime Rate fund, which credits account balances on a daily basis, at the prime rate quoted by The Wall Street Journal as
of the first business day of the given quarter. For fiscal 2016, the rate credited under this fund was 3.5%. Balances in the plan are vested and may be paid out in a lump sum in cash six
months following termination, or in five or ten-year increments commencing the year following termination of employment.
Executive Savings Investment Plan
Under the terms of our executive savings investment plan, our excess 401(k) plan, amounts that would be contributed, either by an executive or by us on the
executives behalf, to
Energizer Holdings, Inc.
2016 Proxy Statement
49
EXECUTIVE COMPENSATION
our qualified defined contribution plan (the 401(k) plan) but for limitations imposed by the IRC, are credited to the non-qualified executive savings investment plan. Under that plan,
executives may elect to defer their contributions into any of the measurement fund options which track the performance of the Vanguard investment funds offered under our qualified
savings investment plan. Deferrals and vested company contributions may be transferred to different investment options at the executives discretion. Deferrals in the executive savings
investment plan, adjusted for the net investment return, are paid out in a lump sum payment, or in five or ten annual installments, following retirement or other termination of employment.
50
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
NON-QUALIFIED DEFERRED COMPENSATION TABLE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Plan
|
|
Executive
Contributions in
Last FY
($)(1)
|
|
|
Registrant
Contributions in
Last FY
($)(2)
|
|
|
Aggregate
Earnings in
Last FY
($)(3)
|
|
|
Aggregate
Withdrawals/
Distributions
($)
|
|
|
Aggregate
Balance at
Last FYE
($)(4)
|
|
A.R. Hoskins
|
|
Defd Comp. Plan
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
145,915
|
|
|
$
|
5,514
|
|
|
$
|
4,390,065
|
|
|
|
Exec. S.I.P.
|
|
$
|
102,797
|
|
|
$
|
105,927
|
|
|
$
|
55,307
|
|
|
$
|
0
|
|
|
$
|
925,574
|
|
|
|
Total
|
|
$
|
102,797
|
|
|
$
|
105,927
|
|
|
$
|
201,222
|
|
|
$
|
5,514
|
|
|
$
|
5,315,639
|
|
B.K. Hamm
|
|
Defd Comp. Plan
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
17,732
|
|
|
$
|
284,073
|
|
|
$
|
462,506
|
|
|
|
Exec. S.I.P.
|
|
$
|
109,119
|
|
|
$
|
35,345
|
|
|
$
|
34,905
|
|
|
$
|
0
|
|
|
$
|
362,344
|
|
|
|
Total
|
|
$
|
109,119
|
|
|
$
|
35,345
|
|
|
$
|
52,637
|
|
|
$
|
284,073
|
|
|
$
|
824,850
|
|
M.S. LaVigne
|
|
Defd Comp. Plan
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
17,169
|
|
|
$
|
2,842
|
|
|
$
|
516,193
|
|
|
|
Exec. S.I.P.
|
|
$
|
133,159
|
|
|
$
|
46,256
|
|
|
$
|
90,451
|
|
|
$
|
0
|
|
|
$
|
829,782
|
|
|
|
Total
|
|
$
|
133,159
|
|
|
$
|
46,256
|
|
|
$
|
107,620
|
|
|
$
|
2,842
|
|
|
$
|
1,345,975
|
|
G.T. Kinder
|
|
Defd Comp. Plan
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
|
Exec. S.I.P.
|
|
$
|
40,187
|
|
|
$
|
26,585
|
|
|
$
|
10,332
|
|
|
$
|
0
|
|
|
$
|
134,313
|
|
|
|
Total
|
|
$
|
40,187
|
|
|
$
|
26,585
|
|
|
$
|
10,332
|
|
|
$
|
0
|
|
|
$
|
134,313
|
|
E.K. Boss
|
|
Defd Comp. Plan
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
|
Exec. S.I.P.
|
|
$
|
46,028
|
|
|
$
|
18,903
|
|
|
$
|
10,921
|
|
|
$
|
0
|
|
|
$
|
139,163
|
|
|
|
Total
|
|
$
|
46,028
|
|
|
$
|
18,903
|
|
|
$
|
10,921
|
|
|
$
|
0
|
|
|
$
|
139,163
|
|
(1)
|
The officer contributions to our executive savings investment plan during fiscal 2016 consist of deferrals of salary earned with respect to fiscal 2016.
|
(2)
|
Contributions and accruals to our executive savings investment plan consist of company contributions which would have otherwise been contributed to the 401(k) plan but for limitations imposed by the IRS. These amounts,
in their entirety, are included in the All Other Compensation column of the
Summary Compensation Table
.
|
(3)
|
Aggregate earnings/(losses) shown in this column consist of:
|
|
|
|
amounts credited to each executive under the investment options of each of the plans, reflecting actual earnings on investment funds offered under our qualified 401(k) plan;
|
|
|
|
in the case of the prime rate option of our deferred compensation plan, interest at the prime rate, quoted by the Wall Street Journal; and
|
|
|
|
the appreciation or depreciation in value of each of the investment options in the plans between October 1, 2015 and September 30, 2016.
|
(4)
|
Of the aggregate balances shown in this column with respect to the executive savings investment plan, the following amounts were previously reported as compensation in the
Summary Compensation Table
of our proxy statement for our 2016 Annual Meeting:
|
Energizer Holdings, Inc.
2016 Proxy Statement
51
EXECUTIVE COMPENSATION
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL
We have not entered into general employment agreements with any of our named executive officers. We have adopted an executive severance plan providing for certain
benefits in connection with a qualifying termination, as described below. We have also entered into change of control employment agreements with our named executive officers and certain of our other key employees which provide for severance
compensation, acceleration of vesting and a lump sum payout in lieu of a continuation of benefits upon qualified termination of employment following a change of control. Additionally, equity awards under our Equity Incentive Plan, including awards
previously granted by our former parent company that have been converted into equity awards that relate to Energizers common stock, provide for acceleration of vesting of certain awards in the event of certain terminations of employment.
The information below reflects the value of acceleration or incremental compensation which each officer would receive upon the termination of his or her employment or
upon a change in control. Because the value of awards and incremental compensation depend on several factors, actual amounts can only be determined at the time of the event.
The information is based on the following assumptions:
|
|
|
the event of termination (death, permanent disability, involuntary termination without cause, or voluntary termination), or a change of control of the Company, occurred on September 30, 2016, the last day of our
fiscal year;
|
|
|
|
the market value of our common stock on that date was $49.96 (the actual closing price on September 30, 2016); and
|
|
|
|
each of the officers were terminated on that date.
|
The information does not reflect benefits that are provided under our
plans or arrangements that do not discriminate in favor of executive officers and are available generally to all salaried employeessuch as amounts accrued under our 401(k) plan, accumulated and vested benefits under our retirement plans
(including our pension restoration plan and executive savings investment plan), health, welfare and disability benefits, and accrued vacation pay.
The information
below also does not include amounts under our deferred compensation plan or executive savings investment plan that would be paid, as described in the
Non-Qualified Deferred Compensation Table
, except to the extent that an
officer is entitled to an accelerated benefit as a result of the termination.
Executive Severance Plan
On July 1, 2015, we adopted an executive severance plan which provides benefits to our senior executives, including each of the named executive officers, in the
event of a qualifying termination as defined in the plan, which means an involuntary termination without cause or a voluntary termination as a result of good reason. Post-termination benefits for the senior
executives consist of:
|
|
|
A lump sum payment of one or two times his or her annual base salary at the time of the qualifying termination, which will be two times for Messrs. Hoskins, Hamm and LaVigne and one times for Mr. Kinder and
Ms. Boss;
|
|
|
|
For each of the named executive officers, a pro-rata bonus payment based on the number of days during the bonus year the participant was employed and the amount of annual bonus which the participant would have received
if he or she had remained employed, based on actual Company performance; and
|
52
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
|
|
|
outplacement services for up to 12 months.
|
The payment of benefits under the plan is conditioned upon the executive
executing a general release in favor of the Company, as well as confidentiality, non-solicitation, non-disparagement and non-competition obligations. In addition, no benefits will be paid to the extent duplicative of benefits under a change in
control or similar agreement with the Company.
Death, Disability or Termination of Employment (Other than Upon a Change of Control)
Upon an officers death, permanent disability, involuntary termination other than for cause (defined as termination for gross misconduct), and, in some cases,
retirement, the following plans or programs provide for acceleration of certain awards. Awards are accelerated for retirement after attainment of age 55 with 10 years of service (including service with our former parent companies) if granted 12 or
more months prior to retirement date. No awards are accelerated upon other voluntary termination or involuntary termination for cause. Performance awards vesting upon retirement are paid when results for the Performance Period are met.
|
|
|
|
|
|
|
|
|
|
|
Involuntary
Termination
|
|
Death
|
|
Disability
|
|
Retirement
After Age 55 with
10 years of service
|
Three-year restricted stock
awards granted 11/6/13
|
|
Forfeited
|
|
Accelerated
|
|
Accelerated
|
|
Pro Rata Vesting
|
Two-year restricted stock awards granted 11/13/14
|
|
Forfeited
|
|
Accelerated
|
|
Accelerated
|
|
Pro Rata Vesting
|
Five-year restricted stock
awards granted 7/8/15
|
|
Pro Rata
Vesting
|
|
Accelerated
|
|
Accelerated
|
|
Pro Rata Vesting
|
Three-year performance awards granted 11/6/13 (converted to time-based restricted stock
awards at target)
|
|
Forfeited
|
|
Accelerated
|
|
Pro Rata Vesting
|
|
Pro Rata
Vesting
|
Three-year restricted stock
awards granted 11/16/15
|
|
Forfeited
|
|
Accelerated
|
|
Accelerated
|
|
Pro Rata Vesting
|
Three-year performance awards granted 11/16/15
|
|
Forfeited
|
|
Accelerated
|
|
Pro Rata Vesting
|
|
Pro Rata
Vesting
|
Upon termination of employment for any reason, vested account balances in our deferred compensation plan are paid out in cash to the
participant in either a lump sum, or over a five or ten year period, commencing six months from the date of termination as previously elected by the participant.
Energizer Holdings, Inc.
2016 Proxy Statement
53
EXECUTIVE COMPENSATION
The value of awards which would be accelerated for our named executive officers upon death, disability or retirement as
of September 30, 2016 is shown in the following chart. The value of accelerated restricted stock equivalents reflects a stock price of $49.96, the closing market price of the Companys stock on September 30, 2016. Stock market changes
since September 30, 2016 are not reflected in these valuations.
|
|
|
|
|
Officer
Termination
Events
|
|
Accelerated
Restricted
Stock
Equivalent
Awards *
|
|
A.R. Hoskins: 1
|
|
$
|
15,949,981
|
|
A.R. Hoskins: 2
|
|
$
|
13,319,596
|
|
A.R. Hoskins: 3
|
|
$
|
518,249
|
|
A.R. Hoskins: 4
|
|
$
|
3,170,114
|
|
B.K. Hamm: 1
|
|
$
|
6,015,427
|
|
B.K. Hamm: 2
|
|
$
|
5,095,817
|
|
B.K. Hamm: 3
|
|
$
|
188,946
|
|
M.S. LaVigne: 1
|
|
$
|
7,767,646
|
|
M.S. LaVigne: 2
|
|
$
|
6,831,994
|
|
M.S. LaVigne: 3
|
|
$
|
212,698
|
|
G.T. Kinder: 1
|
|
$
|
3,580,970
|
|
G.T. Kinder: 2
|
|
$
|
2,945,969
|
|
G.T. Kinder: 3
|
|
$
|
71,979
|
|
E.K. Boss: 1
|
|
$
|
2,767,481
|
|
E.K. Boss: 2
|
|
$
|
2,412,447
|
|
E.K. Boss: 3
|
|
$
|
71,979
|
|
Termination Events:
1Death;
2Permanent disability;
3Involuntary termination of employment other than
for cause; and
4Retirement following attainment of age 55 with 10 years of service, 12 months after date of grant.
*The value of accelerated restricted stock equivalents in the chart above is calculated based on the number of stock equivalents that will vest in accordance with
the termination provisions of the agreements valued at $49.96, the closing market price of the Companys stock on September 30, 2016. This calculation differs from the calculation of accelerated vesting for purposes of Code Section 280G
and 4999 as reported in the
Estimated Payments and Benefits
table below.
If the Executive is terminated for one of the following events,
|
|
|
an involuntary termination of an employees employment without Cause; or
|
|
|
|
a voluntary termination of employment by an employee as a result of Good Reason,
|
54
Energizer
Holdings, Inc.
2016 Proxy Statement
EXECUTIVE COMPENSATION
the following payments will be made in accordance with the Executive Severance Plan:
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
|
|
Lump Sum
Severance Payment
|
|
|
|
Outplacement
Services
|
|
|
|
Pro-Rata Bonus Payment
|
A.R. Hoskins
|
|
|
|
Two Times Base Salary
|
|
|
|
Up to 12
months
|
|
|
|
Determined by multiplying the amount the Executive would have received for the year of termination based upon actual Company
performance by a fraction, the numerator is the days in the bonus year during which the Executive was employed and the denominator is the days in the bonus year.
|
B.K. Hamm
|
|
|
|
Two Times Base Salary
|
|
|
|
|
|
M.S. LaVigne
|
|
|
|
Two Times Base Salary
|
|
|
|
|
|
G.T. Kinder
|
|
|
|
One Times Base Salary
|
|
|
|
|
|
E.K. Boss
|
|
|
|
One Times Base Salary
|
|
|
|
|
|
No benefit will be paid to an employee under the Plan to the extent that benefits would otherwise be paid to the employee under the terms
of a Change in Control Employment Agreement (or other similar agreement).
Change of Control of the Company
Our change of control employment agreements with each of the named executive officers have terms of two or three years from July 1, 2015, subject to certain
automatic renewal provisions. For Messrs. Hoskins, Hamm and LaVigne, the term is three years. For Mr. Kinder and for Ms. Boss, the term is two years. The agreement provides that the officer will receive severance compensation in the event
of certain termination events (as provided in the agreement), other than for cause, death or disability, or within specified periods following a change in control of the Company, as such terms are defined in the agreement.
Under the agreements, a change of control is generally defined as an acquisition of more than 50% of the total voting power of the company, a person beneficially owning
more than 20% of the total voting power of the company, or an unapproved change in the majority of the Board.
Under the agreements, upon a change of control, each
officer will receive a pro rata annual bonus for the portion of the year occurring prior to a change of control. If the officer is terminated under the termination events defined in the agreement within specified periods of the change of control,
the severance compensation payable under the agreement consists of:
|
|
|
a payment equal to a multiple of the officers annual base salary and target bonus (defined as the most recent five-year actual bonus percentages multiplied by the greater of base salary at either termination or
change of control), which will be three times in the case of Messrs. Hoskins, Hamm and LaVigne and two times in the case of Mr. Kinder and Ms. Boss;
|
|
|
|
a pro rata portion of the officers target annual bonus for the year of termination; and
|
|
|
|
a lump-sum payment intended to assist with health and welfare benefits for a period of time post-termination.
|
Following
termination of employment, each officer is bound by a one-year covenant not to compete, a one-year non-solicitation covenant, and a covenant of confidentiality. No severance payments under the agreements would be made in the event that an
officers termination is voluntary (other than for good reason), is due to death, disability or normal retirement, or is for cause. Under the agreements, in the event that it is determined that a golden parachute excise tax is due
under the IRC, we will reduce the aggregate amount of the payments payable to an amount such that no such excise tax will be paid if the resulting amount would be greater than the after-tax amount if the payments were not so reduced.
Energizer Holdings, Inc.
2016 Proxy Statement
55
EXECUTIVE COMPENSATION
The agreements also provide that upon a change of control, outstanding equity awards held by each officer will
accelerate and vest in accordance with the terms of the awards, even if the awards have a higher threshold for a change of control. Our equity awards generally define a change of control as an acquisition of 50% or more of
the outstanding shares of our common stock. The terms of our outstanding equity awards vary as to the portion of the unvested award that will accelerate and vest upon a change of control, as indicated below:
|
|
|
Three-year performance awards
granted 11/6/13 (converted to time-based at target)
|
|
100% of the converted stock equivalents will vest upon change of control
|
Three-year time based awards granted 11/6/13
|
|
100% vest upon change of control
|
Two-year time based awards granted 11/13/14
|
|
100% vest upon change of control
|
Five-year time based awards
granted 7/8/15
|
|
100% vest upon change of control
|
Three-year time based awards granted 11/16/15
|
|
100% vest upon change of control
|
Three-year performance awards
granted 11/16/15
|
|
The greater of (i) the number of stock equivalents granted at target or (ii) the amount of
target performance stock equivalents which would have vested had the performance period ended on the date the change of control occurs
|
Payments of cash would be made in a lump sum no sooner than six months following termination of employment, and benefits would be
provided for a three- or two-year period following termination, or if such continuation of benefits would not be possible under our benefit programs, the value of such benefits would also be paid in lump sum no sooner than six months following
termination.
Estimated Payments and Benefits
Based on the assumptions
set out above, the following chart sets forth estimated payments to our named executive officers upon termination following a change of control. If a change of control occurs but their employment is not terminated, the agreements provide a more
limited value. The value of accelerated restricted stock equivalents and performance awards reflects a stock price of $49.96 (the closing price of our common stock on September 30, 2016). Stock market declines and vesting and forfeitures of
unvested restricted stock equivalents since September 30, 2016 are not reflected in these valuations. Upon a change of control, retirement benefits under the executive savings investment plan vest to the extent not already vested.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Cash
Severance
|
|
|
Retirement
Benefits
|
|
|
Restricted
Stock Equivalent
Awards
|
|
|
Benefits
|
|
|
Total
|
|
A.R. Hoskins
|
|
$
|
6,719,653
|
|
|
$
|
0
|
|
|
$
|
15,899,697
|
|
|
$
|
34,737
|
|
|
$
|
22,654,087
|
|
B.K. Hamm
|
|
$
|
3,202,507
|
|
|
$
|
0
|
|
|
$
|
5,997,091
|
|
|
$
|
45,613
|
|
|
$
|
9,245,211
|
|
M.S. LaVigne
|
|
$
|
3,462,747
|
|
|
$
|
0
|
|
|
$
|
7,747,005
|
|
|
$
|
29,458
|
|
|
$
|
11,239,210
|
|
G.T. Kinder
|
|
$
|
1,713,336
|
|
|
$
|
11,463
|
|
|
$
|
3,574,025
|
|
|
$
|
30,409
|
|
|
$
|
5,329,233
|
|
E.K. Boss
|
|
$
|
1,616,171
|
|
|
$
|
10,874
|
|
|
$
|
2,760,536
|
|
|
$
|
19,041
|
|
|
$
|
4,406,622
|
|
56
Energizer
Holdings, Inc.
2016 Proxy Statement
ITEM 3. ADVISORY VOTE ON EXECUTIVE COMPENSATION
As required by Section 14A of the Exchange Act, we are asking our shareholders to provide non-binding advisory approval of the compensation of our
named executive officers, as disclosed pursuant to the compensation disclosure rules of the SEC. We encourage shareholders to review the
Compensation Discussion and Analysis
for details regarding our executive compensation
programs.
This vote is not intended to address any specific item of compensation, but rather the overall compensation of our named executive officers and the
philosophy, policies and practices that we use. We believe that following the Spin-Off, we have made key decisions to facilitate our transition to a public company and to ensure managements interests are aligned with our shareholders
interests. Our compensation programs are designed to enable and reinforce our Companys overall business strategy by aligning pay with achievement of short and long term financial and strategic objectives, while providing a competitive level of
compensation which is needed to recruit, retain and motivate talented executives critical to our success. In particular, we believe that our compensation guiding principlessimple, aligned and balancedprovide us with a framework for
compensation that best incentivizes management performance.
The Board believes the Companys overall compensation process effectively implements its
compensation philosophy and achieves its goals. Accordingly, the Board recommends a vote FOR the adoption of the following advisory resolution, which will be presented at the Annual Meeting:
RESOLVED, that the shareholders of Energizer approve, on an advisory basis, the compensation of the named executive officers, as disclosed pursuant to the compensation
disclosure rules of the SEC, including the Compensation Discussion and Analysis, the compensation tables and the accompanying footnotes and narratives.
Vote
Required.
The affirmative vote of a majority of the voting power represented in person or by proxy and entitled to vote is required for approval of the executive compensation.
The Board of Directors recommends a vote FOR the approval of the executive compensation of our named executive
officers as described in this proxy statement under Executive Compensation.
Because the vote is advisory, it will not be binding on us. Hence,
the Board and the NECC will review the voting results and carefully consider the outcome of the vote when making future decision regarding executive compensation.
Energizer Holdings, Inc.
2016 Proxy Statement
57
ITEM 4. PROPOSAL TO AMEND AND RESTATE THE
COMPANYS AMENDED AND RESTATED ARTICLES OF INCORPORATION TO PROVIDE FOR THE DECLASSIFICATION OF THE BOARD OF DIRECTORS
The Board has approved, and
recommends that the Companys shareholders approve, an amendment and restatement of the Companys Amended and Restated Articles of Incorporation (the Articles of Incorporation) to provide for the phased-in implementation of
annual elections for all directors and the resulting phased-in elimination of the classified Board structure. The proposed amendment and restatement would revise Article Four of the Articles of Incorporation. The full text of the proposed amendment
and restatement of the Articles of Incorporation is set forth in Appendix A to this proxy statement (proposed new text is underlined twice and proposed deleted text is crossed out) (hereinafter referred to as the Second Amended and Restated
Articles of Incorporation).
Background
Our current classified
Board structure has been in place since we became a public company in 2015. The Articles of Incorporation provide that the Board shall be divided into three classes, as nearly equal in number as possible. Directors in each class are elected every
three years to three year terms, with the term of one class expiring at each annual meeting.
Our Board is committed to adopting governance practices that the Board
believes are the most beneficial to the Company and its shareholders. At the time of our Spin-Off from our former parent company in 2015, the Board believed that a classified board structure was an important piece of the Companys governance
structure in order to promote continuity and stability, and was in the best interests of the Company and its shareholders. The Board also believed that the classified board structure has enhanced the independence of our directors from both
management and shareholder special interests and protected the Company against unfair or abusive takeover practices through a period of significant volatility in the immediate aftermath of the Spin-Off.
At the same time, the Board recognizes that many investors view classified boards as having the effect of reducing the accountability of directors to shareholders
because classified boards limit the ability of shareholders to evaluate and elect all directors on an annual basis. As a result, at the time of our
Spin-Off,
the Board committed that, at our 2017 annual
meeting, the first annual meeting after our first full fiscal year as an independent company, we would propose to shareholders an amendment to the Articles of Incorporation that will provide for the staged declassification of the Board of
Directors.
Proposed Second Amended and Restated Articles of Incorporation
If the Second Amended and Restated Articles of Incorporation are approved, then commencing with the class of directors standing for election at the Companys 2018
Annual Meeting, directors will stand for election for one year terms. The term of office for each director elected at the 2018 Annual Meeting and thereafter will expire at the next succeeding annual meeting of shareholders and when his or her
successor is elected and qualified or upon his or her earlier death, resignation or other cause for removal. The approval of the Second Amended and Restated Articles of Incorporation would not shorten the terms to which our shareholders have
previously elected directors. Thus, directors elected at the 2016 Annual Meeting will continue to have terms that expire at the 2019 Annual Meeting and directors elected under Item 1 at this Annual Meeting will have terms that expire at the
2020 Annual Meeting. If the Second Amended and Restated Articles of Incorporation are approved, then commencing with our 2020 Annual Meeting, and at each successive meeting thereafter, our entire Board of Directors would stand for election for a one
year term, and there would no longer be any class designation for directors. If there is a vacancy in the Board at or following the 2017 Annual Meeting, because the number of directors is increased or otherwise, any director elected to fill such
vacancy would hold office for a term expiring at the next annual meeting. If the Second Amended and Restated Articles of Incorporation are not approved, then the Board will remain classified.
58
Energizer
Holdings, Inc.
2016 Proxy Statement
Energizer Holdings, Inc.
2016 Proxy Statement
59
This general description of the proposed changes to the Articles of Incorporation is qualified in its entirety by reference
to the proposed Second Amended and Restated Articles of Incorporation set forth in Appendix A to this proxy statement. If the Second Amended and Restated Articles of Incorporation are approved by the shareholders, then the Second Amended and
Restated Articles of Incorporation will become effective upon their filing with the Missouri Secretary of State. The Board also has adopted a corresponding amendment and restatement to our Amended and Restated Bylaws (the Bylaws) which
will become effective only if the Second Amended and Restated Articles of Incorporation are approved by the shareholders. If the Second Amended and Restated Articles of Incorporation are not approved by the shareholders, then the Articles of
Incorporation and the Bylaws will remain unchanged and the Board will remain classified.
Vote Required.
The affirmative vote of two-thirds of the
holders of record of outstanding shares of common stock of the Company then entitled to vote generally in the election of directors is required to amend and restate the Articles of Incorporation.
The Board of Directors recommends a vote FOR the amendment and restatement of the Articles of Incorporation to
declassify the Board of Directors.
STOCK OWNERSHIP INFORMATION
Five Percent Owners of Common Stock.
The following table shows, as of November 16, 2016, the holdings of the Companys common stock by any entity or person
known to the Company to be the beneficial owner of more than 5% of the outstanding shares of the Companys common stock:
|
|
|
|
|
Name and Address of Beneficial Owner
|
|
Amount and Nature of
Beneficial
Ownership
|
|
Percent of Class
Outstanding(1)
|
J.P. Morgan Chase
& Co.
270 Park Avenue, New York, NY 10017
|
|
5,094,923(2)
|
|
8.2%
|
BlackRock, Inc.
55 East 52
nd
Street, New York, NY 10022
|
|
4,737,319(3)
|
|
7.7%
|
The London
Company
1800 Bayberry Court, Suite 301, Richmond, VA 23226
|
|
4,342,026(4)
|
|
7.0%
|
The Vanguard
Group
100 Vanguard Blvd., Malvern, PA 19355
|
|
4,294,182(5)
|
|
6.9%
|
(1)
|
On November 16, 2016, there were 61,825,747 shares of the Companys common stock outstanding.
|
(2)
|
As reported in a statement on Schedule 13G filed with the SEC on January 27, 2016, J.P. Morgan Chase & Co. and related entities reported, as of December 31, 2015, sole voting power over 4,987,091 of such shares,
shared voting power over 324 of such shares, sole dispositive power over 5,087,893 of such shares and shared dispositive power over 3,463 of such shares.
|
(3)
|
As reported in a statement on Schedule 13G/A filed with the SEC on January 26, 2016, BlackRock, Inc. and related entities reported, as of December 31, 2015, sole voting power over 4,419,215 such shares and sole
dispositive power over 4,737,319 of such shares.
|
(4)
|
As reported in a statement on Schedule 13G/A filed with the SEC on February 9, 2016, The London Company and related entities reported, as of December 31, 2015, sole voting power over 3,994,214 of such shares, sole
dispositive power over 3,994,214 of such shares and shared dispositive power over 347,812 of such shares.
|
(5)
|
As reported in a statement on Schedule 13G filed with the SEC on February 10, 2016, The Vanguard Group and related entities reported, as of December 31, 2015, sole voting power over 44,766 of such shares, shared
voting power over 4,400, sole dispositive power over 4,248,866 of such shares and shared dispositive power over 45,316 of such shares.
|
60
Energizer
Holdings, Inc.
2016 Proxy Statement
STOCK OWNERSHIP INFORMATION
Ownership of Directors and Executive Officers.
The table below contains information regarding beneficial common
stock ownership of directors and executive officers as of November 16, 2016. It does not reflect any changes in ownership that may have occurred after that date. In general, beneficial ownership includes those shares a director or
executive officer has the power to vote or transfer, as well as shares owned by immediate family members that reside with the director or officer. Unless otherwise indicated, directors and executive officers named in the table below have sole voting
and investment power with respect to the shares set forth in the table and none of the stock included in the table is pledged. The table also indicates shares that may be obtained within 60 days upon the exercise of options, or upon the conversion
of vested stock equivalents into shares of common stock.
|
|
|
|
|
|
|
|
|
|
|
Directors
And
Executive
Officers
|
|
Shares
Beneficially
Owned
|
|
|
Stock Equivalents
held in the
Deferred
Compensation
Plan
|
|
|
% of
Shares
Outstanding
(A)
(*denotes
less than
1%)
|
J. Patrick
Mulcahy
|
|
|
562,250(B)(C)
|
|
|
|
95,154
|
|
|
1.06%
|
Alan R.
Hoskins
|
|
|
85,741(C)
|
|
|
|
0
|
|
|
*
|
Bill G.
Armstrong
|
|
|
17,407(C)
|
|
|
|
47,263
|
|
|
*
|
Cynthia J.
Brinkley
|
|
|
3,171(C)
|
|
|
|
0
|
|
|
*
|
Kevin J.
Hunt
|
|
|
3,171(C)
|
|
|
|
0
|
|
|
*
|
James C.
Johnson
|
|
|
6,063(C)
|
|
|
|
173
|
|
|
*
|
John E.
Klein
|
|
|
15,054(C)
|
|
|
|
21,568
|
|
|
*
|
W. Patrick
McGinnis
|
|
|
24,994(C)
|
|
|
|
17,271
|
|
|
*
|
Patrick J.
Moore
|
|
|
3,171(C)
|
|
|
|
0
|
|
|
*
|
John R.
Roberts
|
|
|
30,643(C)
|
|
|
|
9,502
|
|
|
*
|
Brian K.
Hamm
|
|
|
29,833(C)
|
|
|
|
0
|
|
|
*
|
Mark S.
LaVigne
|
|
|
48,436(C)
|
|
|
|
0
|
|
|
*
|
Gregory T.
Kinder
|
|
|
17,940(C)
|
|
|
|
0
|
|
|
*
|
Emily K.
Boss
|
|
|
13,484(C)
|
|
|
|
0
|
|
|
*
|
All Executive
Officers and Directors as a Group (15 persons)
|
|
|
881,960(C)
|
|
|
|
190,931
|
|
|
1.73%
|
(A)
|
The number of shares outstanding for purposes of this calculation was the number outstanding as of November 16, 2016, equivalents that vest within 60 days, or upon retirement, and the number of stock equivalents
held in the deferred compensation plan.
|
(B)
|
Mr. Mulcahy disclaims beneficial ownership of 12,500 shares of common stock owned by his wife and 111 shares owned by his step-daughter.
|
(C)
|
Includes vested stock equivalents which will convert to shares of common stock upon the individuals retirement, resignation from the Board or termination of employment with the Company.
|
|
The number of vested stock equivalents credited to each individual officer or director is as follows: Mr. Mulcahy, 7,059; Mr. Johnson, 2,892; Mr. Klein, 11,883; and
Mr. Roberts, 11,883. This amount also includes the time-based stock equivalents which vested between October 1, 2016 and November 16, 2016. The number of time-based stock equivalents that vested during this period for each officer is
as follows: Mr. Hoskins, 52,879; Mr. Hamm, 23,138; Mr. LaVigne, 49,573; Mr. Kinder, 23,138; Ms. Boss, 17,990; and all other executive officers, 17,990. This amount also includes
|
Energizer Holdings, Inc.
2016 Proxy Statement
61
STOCK OWNERSHIP INFORMATION
|
unvested stock equivalents that vest upon a directors retirement from the Board or upon attainment of certain vesting provisions, in accordance with the time based restricted stock
equivalent awards, upon retirement for the executive officers. The number of unvested stock equivalents credited to each director and officer is as follows: Mr. Armstrong, 3,171;
|
|
Ms. Brinkley, 3,171; Mr. Hoskins, 23,053; Mr. Hunt, 3,171; Mr. Johnson, 3,171; Mr. Klein, 3,171; Mr. McGinnis, 3,171; Mr. Moore, 3,171; Mr. Mulcahy, 8,760; and
Mr. Roberts 8,760. The number of shares in the table reflect net shares after shares have been withheld for taxes.
|
62
Energizer
Holdings, Inc.
2016 Proxy Statement
ADDITIONAL INFORMATION
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Our Board of Directors has adopted a written policy regarding the review and approval or ratification of transactions
involving the Company and our directors, nominees for directors, executive officers, immediate family members of these individuals, and shareholders owning five percent or more of our outstanding common stock, each of whom is referred to as a
related party. The policy covers any related party transaction, arrangement or relationship where a related party has a direct or indirect material interest and the amount involved exceeds $100,000 in any calendar year. Under the policy, the Audit
Committee of the Board is responsible for reviewing and approving, or ratifying, the material terms of any related party transactions. The committee is charged with determining whether the terms of the transaction are any less favorable than those
generally available from unaffiliated third parties, and determining the extent of the related partys interest in the transaction.
In adopting the policy, the
Board reviewed certain types of related party transactions described below and determined that they should be deemed to be pre-approved, even if the aggregate amount involved might exceed $100,000:
|
|
Officer or director compensation which would be required to be disclosed under Item 402 of the SECs compensation disclosure requirements, and expense reimbursements to these individuals in accordance with our
policy;
|
|
|
Transactions with another company at which a related party serves as an employee, director, or holder of less than 10% of that companys
|
|
|
outstanding stock, if the aggregate amount involved does not exceed the greater of $1 million or 2% of that companys consolidated gross revenues;
|
|
|
Charitable contributions to a charitable trust or organization for which a related party serves as an employee, officer or director, if the annual contributions by us do not exceed the greater of $100,000 or 2% of the
organizations total annual receipts; and
|
|
|
Transactions in which all of our shareholders receive proportional benefits, the rates or charges involved are determined by competitive bids, the transaction involves obtaining services from a regulated entity at rates
fixed by law, or the transaction involves bank services as a depositary of funds, transfer agent or registrar, or similar services.
|
Our legal
department is primarily responsible for the development and implementation of processes and procedures to obtain information from our directors and executive officers with respect to related party transactions.
During fiscal 2016, there were no transactions with executive officers, directors or their immediate family members which were in an amount in excess of $100,000, and in
which any such person had a direct or indirect material interest.
Energizer Holdings, Inc.
2016 Proxy Statement
63
ADDITIONAL INFORMATION
OTHER BUSINESS
The Board knows of no business which will be presented at the 2017 Annual Meeting other than that described above. Our bylaws provide that shareholders may nominate
candidates for directors or present a proposal or bring other business before an annual meeting only if they give timely written notice of the nomination or the matter to be brought not less than 90 nor more than 120 days prior to the first
anniversary of the prior years meeting, as described under
Shareholder Proposals for 2018 Annual Meeting
.
DELIVERY OF DOCUMENTS
Householding of Annual Meeting Materials.
The SEC has approved a rule permitting the delivery of a single Notice Regarding the
Availability of Proxy Materials, and set of Annual Reports and Proxy Statements (if paper copies of such documents have been delivered or requested), to any household at which two or more shareholders reside, unless we have received contrary
instructions from one or more of the shareholders residing in such household. Each shareholder will continue to receive a separate proxy card. This procedure, referred to as householding, reduces the volume of duplicate information you
receive, as well as our expenses. In order to take advantage of this opportunity, we will deliver only one copy of the Notice Regarding the Availability of Proxy Materials, and this Proxy Statement and related Annual Report (if paper copies of such
documents have been delivered or requested) to multiple shareholders who share an address, unless we receive contrary instructions from the impacted shareholders prior to the mailing date. If you prefer to receive separate copies of our Notice
Regarding the Availability of Proxy Materials, our Proxy Statement or Annual Report, either now or in the future, we will promptly deliver, upon your written or oral request submitted as set forth below, a separate copy of the Notice Regarding the
Availability of Proxy Materials, Proxy Statement or Annual Report, as applicable and as requested, to any shareholder at your address to which a single copy was delivered. If you and other shareholders in your household are currently receiving
multiple copies of the Notice Regarding the Availability of Proxy Materials, and this Proxy Statement and our Annual Report (if paper copies of such documents have been delivered or requested) and would like only one copy to be sent to your
household, upon your written request, we will discontinue delivering multiple copies of such document(s) to your household and only deliver one copy. Notice should be given to the Corporate Secretary, Energizer Holdings, Inc., 533 Maryville
University Drive, St. Louis, Missouri 63141 (Tel. No. (314) 985-2000).
64
Energizer
Holdings, Inc.
2016 Proxy Statement
ADDITIONAL INFORMATION
SHAREHOLDER PROPOSALS FOR 2018 ANNUAL MEETING
Any proposals to be presented at the 2018 Annual Meeting of Shareholders, which is expected to be held on January 29, 2018, must be received by the Company,
directed to the attention of the Corporate Secretary, no later than August 15, 2017 in order to be included in the Companys Proxy Statement and form of proxy for that meeting under Rule 14a-8 of the Exchange Act. Upon receipt of any
proposal, the Company will determine whether or not to include the proposal in the Proxy Statement and proxy card in accordance with regulations governing the solicitation of proxies. The proposal must comply in all respects with the rules and
regulations of the SEC and our bylaws.
In order for a shareholder to nominate a candidate for director under our bylaws, timely notice of the nomination must be
received by us in advance of the meeting. Ordinarily, such notice must be received not less than 90, nor more than 120, days before the first anniversary of the prior years meeting. For the 2018 Annual Meeting, the notice would have to be
received between October 2, 2017 and November 1, 2017. However, in the event that (i) no annual meeting is held in 2017 or (ii) the date of the 2018 Annual Meeting is more than 30 days before or more than 60 days after the first
anniversary of the 2017 Annual Meeting, notice must be received no earlier than the 120th day prior to the date of the 2018 Annual Meeting and not later than the close of business on the later of the 90th day prior to the date of the 2018 Annual
Meeting, or the seventh day following the day on which notice of the date of the meeting was mailed or on which public notice of the meeting was given. The notice of nomination must include, as to each person whom the shareholder proposes to
nominate for election, information required by our bylaws, including:
|
|
|
the nominees name, age, business and residential address;
|
|
|
|
the nominees principal occupation for the previous five years;
|
|
|
|
the nominees consent to being named as a nominee and to serving on the Board;
|
|
|
|
the nominees disclosable interests as of the date of the notice (which information shall be supplemented by such person, if any, not later than ten days after the record date of the Annual Meeting to
disclose such ownership as of the record date), which includes:
|
|
¡
|
|
shares of common stock; options, warrants, convertible securities, stock appreciation rights, or similar rights with respect to our common stock; any proxy, contract,
arrangement, understanding, or relationship conveying a right to vote common stock;
|
|
¡
|
|
any short interest with respect to common stock;
|
|
¡
|
|
any derivative instruments held by a partnership in which the nominee has a partnership interest; and
|
|
¡
|
|
rights to any performance-related fee based on any increase or decrease in the value of common stock or any related derivative instrument; and
|
|
|
|
a description of all monetary or other material agreements, arrangements or understandings between the nominating shareholder and the nominee during the prior three years.
|
In addition, the nominating shareholder must provide their name and address and disclosable interests (as such term is described above). The shareholder must be present
at the Annual Meeting of Shareholders at which the nomination is to be considered, and must provide a completed questionnaire regarding the nominees background and qualification and compliance with our corporate governance, conflict of
interest, and other pertinent policies and guidelines. To assist in the evaluation of shareholder-recommended candidates, the Nominating and Executive Compensation Committee may request that the shareholder provide certain additional information
required to be disclosed in the Companys proxy statement under Regulation 14A of the Exchange Act. The shareholder nominating the candidate must also include his or her name and address, and the number of shares of common stock beneficially
owned.
Energizer Holdings, Inc.
2016 Proxy Statement
65
ADDITIONAL INFORMATION
In order for a shareholder to bring other business before a shareholder meeting, timely notice must be received by the
Company during the same period as director nominations described above. Such notice must include a description of the proposed business and the reasons for the proposal, the name and address of the shareholder making the proposal, any financial or
other interests of the shareholder in the proposal made, and the shareholders disclosable interests. These requirements are separate from the requirements a shareholder must meet to have a proposal included in the Companys Proxy
Statement.
In each case, the notice must be given to the Corporate Secretary of the Company, whose address is 533 Maryville University Drive, St. Louis, Missouri
63141. A copy of our bylaws will be provided without charge upon written request to the Corporate Secretary.
By order of the Board
of Directors,
Benjamin J. Angelette
Deputy General Counsel & Corporate Secretary
December 13, 2016
66
Energizer
Holdings, Inc.
2016 Proxy Statement
APPENDIX APROPOSED SECOND AMENDED AND RESTATED
ARTICLES OF INCORPORATION
(additions are underlined twice; deletions are struck out.)
SECOND
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
ENERGIZER HOLDINGS, INC.
ARTICLE I
NAME
The name of the corporation is Energizer
Holdings, Inc. (the
Corporation
).
ARTICLE II
REGISTERED OFFICE
The address, including
street and number, if any, of the Corporations registered office in this state is 120 South Central Avenue, Clayton, Missouri 63105, and the name of its agent at such address is C T Corporation System.
ARTICLE III
AUTHORIZED SHARES
SECTION 3.1.
CLASSES AND NUMBER OF SHARES
.
(a) The aggregate number, class and par value of shares of capital stock that the Corporation shall have authority to issue is Three Hundred and Ten
Million (310,000,000) shares of stock, consisting of:
(i) Three hundred million (300,000,000) shares of common stock, par value $.01 per
share (
Common Stock
); and
(ii) Ten million (10,000,000) shares of preferred stock, par value $.01 per share
(
Preferred Stock
).
(b) All preemptive rights of shareholders are hereby denied, so that no stock or other security of the
Corporation shall carry with it, and no holder or owner of any share or shares of stock or other security or securities of the Corporation, shall have any preferential or preemptive right to acquire additional shares of stock or of any other
security of the Corporation. All cumulative voting rights are hereby denied, so that no stock or other security of the Corporation shall carry with it, and no holder or owner of any share or shares of such stock or security, shall have any right to
cumulative voting in the election of members of the Board of Directors of the Corporation (the
Directors
) or for any other purpose. The foregoing provisions within this paragraph are not intended to modify or prohibit any
provisions of any voting trust or agreement between or among holders or owners of shares of stock or other securities of the Corporation.
(c) In
addition to those general qualifications, limitations and restrictions applicable to each and every class and series of capital stock of the Corporation as a matter of law or as stated in the immediately preceding paragraph, the preferences,
qualifications, limitations, restrictions, and the special correlative rights, including convertible rights, if any, in respect of the shares of each class are as set forth in the
following
Section
3.2
and
Section
3.3
.
Energizer Holdings, Inc.
2016 Proxy Statement
A-1
SECTION 3.2.
TERMS OF PREFERRED STOCK
.
(a) Subject to the requirements of the General and Business Corporation Law of Missouri, as amended from time to time (the
GBCL
), and
to the provisions of these
Second
Amended and Restated Articles of Incorporation (these
Articles of Incorporation
), Preferred Stock may be issued from time to time by the
Board of Directors as shares of one or more series. The description of shares of each series of Preferred Stock, including any preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends, qualifications and
terms and conditions of redemption, shall be as set forth in these Articles of Incorporation or any amendment hereto, or in a resolution or resolutions duly adopted by the Board of Directors and, to the extent set forth in any such resolution or
resolutions, such information shall be certified to the Secretary of State of Missouri and filed as required by law from time to time, prior to the issuance of any shares of such series.
(b) The Board of Directors is expressly authorized prior to issuance, by adopting resolutions providing for the issuance of, or providing for a change
in the number of, shares of any particular series of Preferred Stock (but not below the number of shares of such series then outstanding) and, if and to the extent from time to time required by law, by filing certification thereto with the Secretary
of State of Missouri, to set or change the number of shares to be included in each series of Preferred Stock (but not below the number of shares of such series then outstanding) and to set or change (in any one or more respects) the designations,
preferences, conversion, relative, participating, optional or other rights, voting powers, restrictions, limitations as to dividends, qualifications, or terms and conditions of redemption relating to the shares of each such series. The authority of
the Board of Directors with respect to each series of Preferred Stock shall include, but not be limited to, setting or changing the following:
(i)
the distinctive serial designation of such series and the number of shares constituting such series (provided that the aggregate number of shares constituting all series of Preferred Stock shall not exceed the aggregate number of authorized shares
set out in
Section
3.1(a)(ii)
of these Articles of Incorporation);
(ii) the dividend rate, if any, on shares of
such series, whether and the extent to which dividends shall be cumulative or non-cumulative, the relative rights of priority, if any, of payment of any dividends, and the time at which and the terms and conditions on which any dividends shall be
paid;
(iii) whether the shares of such series shall be redeemable or purchasable and, if so, the terms and conditions of such redemption or
purchase, including the date or dates upon and after which such shares shall be redeemable or purchasable and the amount per share payable in case of redemption or purchase, which amount may vary under different conditions and at different
redemption or purchase dates;
(iv) the obligation, if any, of the Corporation to retire shares of such series pursuant to a sinking fund and the
terms and conditions of any such sinking fund;
(v) whether shares of such series shall be convertible into, or exchangeable for, shares of stock of
any other series, class or classes, now or hereafter authorized, and, if so, the terms and conditions of such conversion or exchange, including the price or prices or the rate or rates of conversion or exchange and the terms of adjustment, if any;
(vi) whether the shares of such series shall have voting rights, in addition to the voting rights provided by law, and, if so, the terms of such
voting rights;
(vii) the rights of the holders of shares of such series in the event of voluntary or involuntary liquidation, dissolution or
winding up of the Corporation and the relative rights of priority, if any, of such holders with respect thereto; and
A-2
Energizer
Holdings, Inc.
2016 Proxy Statement
(viii) any other relative rights, powers, preferences, qualifications, limitations or restrictions thereof
relating to such series.
SECTION 3.3.
TERMS OF COMMON STOCK
.
(a)
Voting Rights
. Except as otherwise provided by the GBCL, each holder of the Common Stock shall be entitled to one vote per share of
Common Stock held by such holder on all matters to be voted on by the shareholders.
(b)
Dividend Rights
. Subject to the express terms
of any outstanding series of Preferred Stock, dividends may be declared and paid upon the Common Stock out of funds of the Corporation legally available therefor, in such amounts and at such times as the Board of Directors may determine. Funds
otherwise legally available for the payment of dividends on the Common Stock shall not be restricted or reduced by reason of there being any excess of the aggregate preferential amount of any series of Preferred Stock outstanding over the aggregate
par value thereof.
ARTICLE IV
DIRECTORS
SECTION
4.1.
NUMBER
AND CLASSIFICATION
. The number of Directors to constitute the Board of Directors of the Corporation shall be fixed by or in the manner provided in the Bylaws of the Corporation. Any changes in
the number of Directors shall be reported to the Missouri Secretary of State to the extent and within the time periods required by the GBCL. As of the effective date of these Articles of
Incorporation,
each person elected as a Director of the Corporation after the 2017 annual meeting of shareholders, whether to succeed
a person whose term of office as a Director has expired or to fill any vacancy, shall be elected for a term expiring at the annual meeting of shareholders held in the year following the year of his or her election. Each Director elected at or prior
to the 2017 annual meeting of shareholders shall continue to serve as a Director for the term for which he or she was elected. In each case, Directors shall hold office until their successors are elected and qualified, or until their earlier death,
resignation or removal.
the Directors shall be divided into three classes, as nearly equal in number as is reasonably possible, with the term of office of the first class to expire at the 2016 annual meeting of shareholders, the term of
office of the second class to expire at the 2017 annual meeting of shareholders and the term of office of the third class to expire at the 2018 annual meeting of shareholders, with each Director to hold office until his or her successor shall have
been duly elected and qualified.
At each annual meeting of
shareholders (i)
Directors elected to succeed those Directors whose terms then expire shall be elected for a term of office
to expire at the third succeeding annual meeting of shareholders after their election, so that the term of office of only one class of Directors shall expire at each annual meeting, with each Director to hold office until his or her successor shall
have been duly elected and qualified or until his or her earlier death, resignation or removal, and (ii)
if authorized by a resolution of the Board of Directors, Directors may be elected to fill any vacancy on the Board of
Directors, regardless of how such vacancy shall have been created.
Notwithstanding the foregoing, whenever the holders of any one or more classes or series of stock of the Corporation, other than shares of Common Stock, shall have the
right, voting separately by class or series, to elect Directors, then the election, term of office, filling of vacancies and other features of such directorship shall be governed by the terms of the Articles of Incorporation of the Corporation or
any certificate of designation thereunder applicable thereto. As used in these Articles of Incorporation, the term entire Board of Directors or the entire Board means the total number of Directors fixed by, or in accordance
with, these Articles of Incorporation and the Bylaws of the Corporation.
SECTION 4.2.
REMOVAL OF DIRECTORS
. Subject to, and in addition
to, the rights, if any, of the holders of any class of capital stock of the Corporation (other than the Common Stock) then outstanding or any limitation imposed by law, (i) any Director, or the entire Board of Directors, may be
Energizer Holdings, Inc.
2016 Proxy Statement
A-3
removed from office at any time prior to the expiration of his, her or their term of office only for cause and only by the affirmative vote of the holders of record of outstanding shares
representing not less than two-thirds of all of the then outstanding shares of capital stock of the Corporation then entitled to vote generally in the election of Directors, voting together as a single class, at a special meeting of shareholders
called expressly for that purpose (such vote being in addition to any required class or other vote), and (ii) any Director may be removed from office by the affirmative vote of a majority of the entire Board of Directors at any time prior to
the expiration of his or her term of office, as provided by law, in the event that the Director fails to meet any qualifications stated in the Bylaws for election as a Director or in the event that the Director is in breach of any agreement between
the Director and the Corporation relating to the Directors service as a Director or employee of the Corporation.
SECTION
4.3.
VACANCIES
. Subject to the rights, if any, of the holders of any class of capital stock of the Corporation (other than the Common Stock) then outstanding, and except as expressly provided for
in
Section
4.1
, any vacancies in the Board of Directors which occur for any reason, including vacancies which occur by reason of an increase in the number of Directors or the removal of a Director, shall be filled only
by the Board of Directors, acting by the affirmative vote of a majority of the remaining Directors then in office (although less than a quorum). Any replacement Director so elected shall hold office for a term expiring at the
next
annual meeting of shareholders
held immediately following such person being elected to fill the vacancy
at which the
term of office of the class to which they have been appointed expires
,
and until such Directors successor is elected and qualified or until such Directors earlier
death, resignation or removal.
ARTICLE V
The duration of the Corporation is perpetual.
ARTICLE VI
PURPOSE
The Corporation is formed to engage in any lawful act or activity for which a corporation now or hereafter may be organized under the laws of the State
of Missouri.
ARTICLE VII
BYLAWS;
MEETINGS OF SHAREHOLDERS
SECTION 7.1.
BYLAWS
. Only a majority of the entire Board of Directors may make, amend, alter, change or
repeal any provision or provisions of the Bylaws of the Corporation.
SECTION 7.2.
SPECIAL MEETINGS
. Special meetings of shareholders
may be called only by the affirmative vote of a majority of the entire Board of Directors or by the Chairman of the Board or the President of the Corporation by request for such a meeting in writing. Only such business shall be conducted, and only
such proposals shall be acted upon, as are specified in the notice of any special meeting of shareholders. Shareholders shall have no right to request to call a special meeting.
SECTION 7.3.
WRITTEN CONSENT OF SHAREHOLDERS
. Any action that is required or that may be taken at any meeting of the shareholders may be
taken without a meeting if consent in writing, setting forth the action so taken, shall be signed by all of the shareholders entitled to vote with respect to the subject matter thereof.
SECTION 7.4.
ADVANCE NOTICE
. Advance notice of shareholder nominations for the election of Directors and business to be brought by
shareholders before any meeting of the shareholders of the Corporation shall be given in the manner provided in the Bylaws of the Corporation.
A-4
Energizer
Holdings, Inc.
2016 Proxy Statement
ARTICLE VIII
INDEMNIFICATION AND EXCULPATION
SECTION
8.1.
ACTIONS INVOLVING DIRECTORS, OFFICERS AND EMPLOYEES
. The Corporation shall indemnify and hold harmless each person (other than a party plaintiff suing on his or her own behalf or in the right of the Corporation) who at any time is
serving or has served as a Director, officer or employee of the Corporation against any claim, liability or expense incurred as a result of such service, or as a result of any other service on behalf of the Corporation while also serving as a
Director, officer or employee of the Corporation, or service at the request of the Corporation (which request need not be in writing), while also serving as a Director, officer or employee of the Corporation, as a director, officer, employee,
member, or agent of another corporation, partnership, joint venture, trust, trade or industry association or other enterprise (whether incorporated or unincorporated, for-profit or not-for-profit) to the maximum extent permitted by law, unless the
conduct of such person underlying the proceeding in question has been finally adjudged to have been knowingly fraudulent, deliberately dishonest or to constitute willful misconduct, or unless the Corporation is otherwise prohibited by law from
providing such indemnification. Without limiting the generality of the foregoing, the Corporation shall indemnify any such person (other than a party plaintiff suing on his or her behalf or in the right of the Corporation), who was or is a party or
is threatened to be made a party, to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (including, but not limited to, an action by or in the right of the Corporation) as a
result of such service or any other service on behalf of the Corporation while also serving as a Director, officer or employee of the Corporation against expenses (including, without limitation, costs of investigation and attorneys fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred by him or her in connection with such action, suit or proceeding.
SECTION 8.2.
MANDATORY INDEMNIFICATION
.
(a)
Directors, Officers and Employees
. To the extent that a Director, officer or employee of the Corporation has been successful on the
merits or otherwise in defense of any action, suit or proceeding, to which action, suit or proceeding such Director, officer or employee was or is a party by reason of such persons service to the Corporation in such capacity, or as a result of
any other service on behalf of the Corporation while also serving as a Director, officer or employee of the Corporation, or in defense of any claim, issue or matter therein, he or she shall be indemnified against expenses (including attorneys
fees) actually and reasonably incurred by him or her in connection with the action, suit or proceeding, or proportionally to such claim, issue or matter therein.
(b)
Agents
. To the extent that an agent of the Corporation has been successful on the merits or otherwise in defense of any action, suit or
proceeding, to which action, suit or proceeding such agent was or is a party by reason of service to the Corporation in such capacity, or as a result of any other service on behalf of the Corporation while also serving as an agent of the
Corporation, or in defense of any claim, issue or matter therein, the Corporation is not required to, but may, in its discretion, indemnify such individual against expenses (including attorneys fees) actually and reasonably incurred by him or
her in connection with the action, suit or proceeding, or proportionally to such claim, issue or matter therein, at the discretion of the Corporation.
SECTION 8.3.
ARTICLE
VIII PROVISIONS NOT EXCLUSIVE RIGHT
. The indemnification provided by
this
Article
VIII
shall not be deemed exclusive of any other rights to which those seeking indemnification may be entitled, whether under the Bylaws of the Corporation or any statute, agreement, vote of
shareholders or disinterested Directors or otherwise, both as to action in an official capacity and as to action in another capacity while holding such office.
SECTION 8.4.
INDEMNIFICATION AGREEMENTS AUTHORIZED
. Without limiting the other provisions of
this
Article
VIII
, the Corporation is authorized from time to time, without further action by
Energizer Holdings, Inc.
2016 Proxy Statement
A-5
the shareholders of the Corporation, to enter into agreements with any Director, officer, employee or agent of the Corporation providing such rights of indemnification as the Corporation may deem
appropriate, up to the maximum extent permitted by law. Any agreement entered into by the Corporation with a Director may be authorized by the other Directors, and such authorization shall not be invalid on the basis that different or similar
agreements may have been or may thereafter be entered into with other Directors.
SECTION 8.5.
STANDARD OF CONDUCT
. Except as may
otherwise be permitted by law, no person shall be indemnified pursuant to this
Article
VIII
(including without limitation pursuant to any agreement entered into pursuant
to
Section
8.4
of these Articles of Incorporation) from or on account of such persons conduct which is finally adjudged to have been knowingly
fraudulent, deliberately dishonest or willful misconduct. The Corporation may (but need not) adopt a more restrictive standard of conduct with respect to the indemnification of any agent of the Corporation.
SECTION 8.6.
INSURANCE
. The Corporation may purchase and maintain insurance on behalf of itself or any person who is or was a Director,
officer, employee or agent of the Corporation, or who is or was otherwise serving on behalf or at the request of the Corporation in any capacity against any claim, liability or expense asserted against him or her and incurred by him or her in any
such capacity, or arising out of his or her status as such, whether or not the Corporation would have the power to indemnify him or her against such liability under the provisions of this
Article
VIII
.
SECTION 8.7.
CERTAIN DEFINITIONS
. For the purposes of this
Article
VIII
:
(a)
Service in Representative Capacity
. Any Director, officer or employee of the Corporation who shall serve as a director, officer or
employee of any other corporation, partnership, joint venture, trust or other enterprise of which the Corporation, directly or indirectly, is or was the owner of 20% or more of either the outstanding equity interests or the outstanding voting stock
(or comparable interests) shall be deemed to be so serving at the request of the Corporation, unless the Board of Directors of the Corporation shall determine otherwise. In all other instances where any person shall serve as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or other enterprise of which the Corporation is or was a stockholder or creditor, or in which it is or was otherwise interested, if it is not otherwise established that such
person is or was serving as a director, officer, employee or agent at the request of the Corporation, the Board of Directors of the Corporation may determine whether such service is or was at the request of the Corporation, and it shall not be
necessary to show any actual or prior request for such service.
(b)
Predecessor Corporations
. References to a corporation include all
constituent corporations absorbed in a consolidation or merger, as well as the resulting or surviving corporation, so that any person who is or was a director, officer, employee or agent of a constituent corporation or is or was serving at the
request of a constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise shall stand in the same position under the provisions of
this
Article
VIII
with respect to the resulting or surviving corporation as he or she would if he or she had served the resulting or surviving corporation in the same capacity.
(c)
Service for Employee Benefit Plan
. The term other enterprise shall include, without limitation, employee benefit plans and
voting or taking action with respect to stock or other assets therein; the term serving at the request of the Corporation shall include, without limitation, any service as a director, officer, employee or agent of a corporation which
imposes duties on, or involves services by, a director, officer, employee or agent with respect to any employee benefit plan, its participants or beneficiaries; a person who acted in good faith and in a manner he or she reasonably believed to be in
the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have satisfied any standard of care required by or pursuant to this
Article
VIII
in connection with such plan;
A-6
Energizer
Holdings, Inc.
2016 Proxy Statement
and the term fines shall include, without limitation, any excise taxes assessed on a person with respect to an employee benefit plan and shall also include any damages (including
treble damages) and any other civil penalties.
SECTION 8.8.
LIABILITY OF THE DIRECTORS, OFFICERS AND EMPLOYEES
.
(a) No Director of the Corporation shall be personally liable to the Corporation or its shareholders for monetary damages for breach of fiduciary duty
as a Director;
provided
, however, that the foregoing clause shall not apply to any liability of a Director (i) for any breach of the Directors duty of loyalty to the Corporation or its shareholders, (ii) for acts or
omissions not in subjective good faith or which involve intentional misconduct or a knowing violation of law, (iii) under § 351.345 of the GBCL, or (iv) for any transaction from which the Director derived an improper personal benefit.
(b) It is the intention of the Corporation to limit the personal liability of the Directors, officers and employees of the Corporation, in their
capacity as such, whether to the Corporation, its shareholders or otherwise, to the fullest extent permitted by law. Consequently, should the GBCL or any other applicable law be amended or adopted hereafter so as to permit the elimination or
limitation of such liability, the liability of the Directors and/or officers and/or employees of the Corporation shall be so eliminated or limited without the need for amendment of these Articles or for further action on the part of the shareholders
of the Corporation.
SECTION 8.9.
SURVIVAL; AMENDMENT
.
(a) Each person who was or is a Director, officer or employee of the Corporation is a third party beneficiary to
this
Article
VIII
, shall be entitled to rely upon all of his or her indemnification rights provided or contemplated by this
Article
VIII
as a binding contract with the Corporation, and shall be entitled to enforce against, and rely on as a binding contract with, the Corporation all of his or her indemnification rights provided or
contemplated by this
Article
VIII
. Such indemnification rights shall continue as to a person who has ceased to be a Director, officer or employee, and shall inure to the benefit of the heirs, executors and
administrators of such a person.
(b) This
Article
VIII
may be hereafter amended, modified or repealed as
provided in
Article
IX
of these Articles of Incorporation;
provided
, however, that no such amendment, modification or repeal shall (i) reduce, terminate or otherwise adversely affect any right or
protection, provided in this
Article
VIII
of any person who was or is a Director, officer or employee of the Corporation to obtain indemnification or an advance of expenses with respect to a proceeding that
pertains to or arises out of any act, omission or event occurring or condition or circumstance existing prior to the Deadline Indemnification Date, or (ii) have any effect on the liability or alleged liability of any person who was or is a
Director, officer or employee of the Corporation for or with respect to any act, omission or event occurring or condition or circumstance existing prior to the Deadline Indemnification Date. For purposes of
this
Section
8.9
, the term
Deadline Indemnification Date
shall mean the later of: (1) the effective date of any amendment or repeal of this
Article
VIII
which
reduces, terminates or otherwise adversely affects the rights hereunder of any person who was or is a Director, officer or employee, (2) the expiration of such persons then current term of office with, or service for, the Corporation
(provided such person has a stated term of office or service and completes such term), or (3) the effective date such person resigns his office or terminates his service (provided such person has a stated term of office or service but resigns
prior to the expiration of such term).
Energizer Holdings, Inc.
2016 Proxy Statement
A-7
ARTICLE IX
AMENDMENT OF THE ARTICLES OF INCORPORATION
Subject to
Section
8.9
of these Articles of Incorporation, the Corporation reserves the right to amend, alter,
change or repeal any provision contained in these Articles of Incorporation in the manner now or hereafter prescribed by law, and all rights and powers conferred herein on the shareholders, Directors, officers, employees or agents of the Corporation
are subject to this reserved power;
provided
, that (in addition to any required class or other vote) the affirmative vote of the holders of record of outstanding shares representing not less than two-thirds of all of the outstanding
shares of capital stock of the Corporation then entitled to vote generally in the election of Directors, voting together as a single class, shall be required to amend, alter, change or repeal
Article
IV
or
Article
VII
of these Articles of Incorporation and this
Article IX
, notwithstanding the fact that a lesser percentage may be specified by the laws of Missouri.
A-8
Energizer
Holdings, Inc.
2016 Proxy Statement
PRELIMINARY COPY
YOUR VOTE IS IMPORTANT. PLEASE VOTE TODAY.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vote by Internet or Telephone QUICK
«
«
«
EASY
|
IMMEDIATE 24 Hours a Day, 7 Days a Week or by Mail
|
|
|
|
|
|
|
|
ENERGIZER HOLDINGS, INC.
|
|
|
|
Voting by telephone
or Internet is quick, easy and immediate
. As a shareholder of Energizer
Holdings, Inc., you have the option of voting your shares electronically through the Internet or on the telephone, eliminating the need to return the proxy card. Your electronic vote authorizes the named proxies to vote your shares in the same
manner as if you marked, signed, dated and returned the proxy card. Votes submitted electronically over the Internet or by telephone must be received by 7:00 p.m., Eastern Standard Time, on January 29, 2017.
|
|
|
|
|
|
|
INTERNET/MOBILE
www.cstproxyvote.com
|
|
|
|
|
|
|
Use the Internet to vote your proxy. Have your proxy card available when you access the above website. Follow the prompts to vote your
shares.
|
|
|
|
|
|
|
PHONE 1 (866) 894-0537
Use a touch-tone telephone to vote your proxy. Have your proxy card available when you call. Follow the voting instructions to vote your shares.
|
|
|
|
|
|
PLEASE DO NOT RETURN THE PROXY CARD IF YOU ARE VOTING ELECTRONICALLY OR BY PHONE
|
|
|
|
|
|
|
|
|
|
|
MAIL
Mark, sign and date your proxy card and return it in the postage-paid envelope provided.
|
|
|
|
|
|
|
|
|
p
FOLD HERE AND SEPARATE IF ATTENDING
MEETING INSERT IN ENVELOPE PROVIDED
p
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROXY
|
|
Please mark your votes like this
|
|
x
|
|
|
|
|
|
|
|
|
|
|
|
ENERGIZER HOLDINGS, INC.
|
|
|
|
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH ITEM:
|
|
|
|
|
|
1. Election of Directors
|
|
FOR
|
|
AGAINST
|
|
ABSTAIN
|
|
|
Nominees:
|
|
(01) Cynthia J. Brinkley
|
|
¨
|
|
¨
|
|
¨
|
|
|
|
|
|
|
FOR
|
|
AGAINST
|
|
ABSTAIN
|
|
|
|
|
(02) John E. Klein
|
|
¨
|
|
¨
|
|
¨
|
|
|
|
|
|
|
|
2. Ratification of appointment of PricewaterhouseCoopers LLP as the Companys independent registered public accounting firm for fiscal 2017
|
|
FOR
¨
|
|
AGAINST
¨
|
|
ABSTAIN
¨
|
|
|
|
|
|
|
|
3. Advisory vote on executive compensation
|
|
FOR
|
|
AGAINST
|
|
ABSTAIN
|
|
|
|
¨
|
|
¨
|
|
¨
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FOR
|
|
AGAINST
|
|
ABSTAIN
|
4. Vote to amend and restate the Amended and Restated Articles of Incorporation to provide for the declassification of the Companys
Board of Directors
|
|
¨
|
|
¨
|
|
¨
|
|
|
|
|
|
|
|
|
Mark box at right if you plan to attend the Annual Meeting on January 30, 2017.
|
|
|
|
¨
|
|
|
|
|
|
|
|
|
|
COMPANY ID:
|
|
|
|
|
|
|
PROXY NUMBER:
|
|
|
|
|
|
|
ACCOUNT NUMBER:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Signature
|
|
|
|
Signature, if held jointly
|
|
|
|
Date
|
|
.
|
|
|
|
|
|
|
Note: Please sign exactly as name appears hereon. When shares are held by joint owners, both should sign. When signing as attorney, executor, administrator, trustee, guardian, or corporate officer, please give title as
such.
|
2017 ANNUAL MEETING ADMISSION TICKET
ENERGIZER HOLDINGS, INC.
2017 ANNUAL MEETING OF SHAREHOLDERS
January 30, 2017
8:00 a.m. local
time
Energizer World Headquarters
533 Maryville University Drive
St.
Louis, Missouri 63141
Please present this ticket and photo identification for admittance to the Annual Meeting.
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The Notice of Annual Meeting of Shareholders, Proxy Statement
and our 2016 Annual Report are available at:
www.cstproxy.com/energizer/2016.
p
FOLD HERE AND SEPARATE IF ATTENDING MEETING INSERT IN ENVELOPE
PROVIDED
p
ENERGIZER HOLDINGS, INC.
PROXY
This Proxy is Solicited on
Behalf of the Board of Directors for the Annual Meeting of Shareholders on January 30, 2017
This proxy when properly executed will be voted in the
manner directed herein by the undersigned Shareholder.
If no direction is made, this Proxy will be voted FOR all nominees in Item 1, and FOR Items 2, 3, and 4, and in the discretion of the proxies on any other
business that may properly come before the meeting.
The undersigned hereby appoints Alan R. Hoskins and Emily K. Boss, or either of them, as true and lawful attorneys-in-fact, agents and proxies, with the power of substitution and revocation, to
represent and to vote, as designated on the reverse side hereof, all the shares of the undersigned held of record on November 30, 2016, at the Annual Meeting of Shareholders to be held on January 30, 2017 and any adjournments or postponement
thereof.
(continued and to be marked, dated and signed, on the other side)
Energizer (NYSE:ENR)
Historical Stock Chart
From Mar 2024 to Apr 2024
Energizer (NYSE:ENR)
Historical Stock Chart
From Apr 2023 to Apr 2024