PROXY STATEMENT
COURIER
CORPORATION
15
Wellman Avenue
North
Chelmsford, Massachusetts 01863
ANNUAL
MEETING OF STOCKHOLDERS
January 16, 2008
NATURE
OF SOLICITATION
This
Proxy Statement is furnished in connection with and accompanies a Proxy Card
(the Proxy) for and Notice of Annual Meeting of Stockholders (the Notice)
of Courier Corporation (the Corporation or Courier), to be held Wednesday,
January 16, 2008 at ll:00 A.M. at the Boston University Corporate Education
Center, 72 Tyng Road, Tyngsboro, Massachusetts, for the purposes set forth in
the Notice. The solicitation is made on
behalf of the Board of Directors of the Corporation.
This
Proxy Statement and the accompanying Notice and Proxy are first being sent to
stockholders on or about December 7, 2007.
The Board of Directors has fixed the close of business on November 19,
2007 as the record date for the determination of stockholders entitled to
notice of and to vote at the Annual Meeting (the Record Date).
The
cost of preparing, assembling and mailing the Proxy and Notice and this Proxy
Statement and of soliciting Proxies is to be borne by the Corporation. In addition to the use of the mails,
solicitation may be made by telephone and personally by employees and Directors
of the Corporation. Georgeson
Shareholder Communications, Inc. has been hired by the Corporation to act as a
distribution agent and solicitor only with respect to record holders who are
brokers, dealers, banks or other entities that exercise fiduciary powers in
nominee name or otherwise, at a fee of approximately $5,500. The Corporation will also bear the expense of
record holders who are banks, brokers and other fiduciaries or nominees who may
forward Proxies and proxy material to beneficial owners of such shares.
Any Proxy given pursuant to this solicitation may be
revoked by the person giving it prior to the exercise of the powers conveyed by
it by filing with the Secretary/Clerk of the Corporation a written revocation
or duly executed Proxy bearing a later date, properly casting a new vote
through the Internet or by telephone at any time before the closure of the
Internet or telephone voting facilities, or by attending the Annual Meeting and
voting in person. Unless a Proxy is
revoked, the shares represented thereby will be voted at the Annual Meeting or
at any adjournment thereof in the manner hereinafter described.
The
Annual Report of the Corporation for the fiscal year ended September 29, 2007,
including financial statements for the fiscal year ended September 29, 2007, is
being mailed to stockholders concurrently with this Proxy Statement.
VOTING
SECURITIES
As of the Record Date,
the securities outstanding and entitled to vote at the Annual Meeting consist
of 12,616,172 shares of Common Stock, par value $1 per share, of the
Corporation (the Common Stock). Only
holders of record on the Record Date will be
1
entitled to vote
at the Annual Meeting. Each stockholder
is entitled to one vote, in person or by proxy, for each share held. A majority in interest of all shares of
Common Stock issued, outstanding and entitled to vote at the Annual Meeting
constitutes a quorum for the meeting (6,308,087 shares). Abstentions and broker non-votes shall be
counted in determining the number of shares present at the Annual Meeting.
A plurality of
votes properly cast for the election of Directors by stockholders attending the
Annual Meeting in person or by proxy will elect Directors to office. A majority of votes properly cast at the
Annual Meeting is required for approval of other matters presented at the
meeting, unless a larger vote is required by law, or by the Corporations
Articles of Organization or By-Laws, each as amended to date. Abstentions and broker non-votes will not be
counted as votes cast at the Annual Meeting for such other matters. Under the Corporations new Corporate
Governance Guidelines, Directors who do not receive a majority of the shares
outstanding are required to submit their resignation to the Board of Directors.
Security Ownership of Certain
Beneficial Owners and Management
The
following table sets forth, as of the Record Date, the ownership of Common
Stock by each Director, by each executive officer named in the Summary
Compensation Table below (each a Named Executive Officer), by all Directors
and executive officers of the Corporation as a group, and by any person or
group known to the Corporation to be the beneficial owner of more than 5% of
the outstanding shares of Common Stock.
The number of shares beneficially owned by each person and entity is
determined according to the rules of the Securities and Exchange Commission
(the Commission), and the information is not necessarily indicative of
beneficial ownership for any other purpose.
Under such rules, beneficial ownership includes any shares as to which
the individual or entity has sole or shared voting power or investment power
and also any shares which the individual or entity has the right to acquire
within sixty days of November 19, 2007 through the exercise of an option or
similar right. Except as noted below,
each holder has sole voting and investment power with respect to all shares of
Common Stock listed as owned by such person or entity.
|
|
Number of Shares
|
|
|
|
|
|
Beneficially
|
|
% of Shares
|
|
Name
|
|
|
Owned (1)(2)(3)
|
|
Outstanding
|
|
James F. Conway III
|
|
959,153
|
(4)
|
7.6
|
%
|
Kathleen Foley Curley
|
|
44,849
|
|
0.4
|
%
|
Richard K. Donahue
|
|
107,633
|
|
0.9
|
%
|
Edward J. Hoff
|
|
384,198
|
(5)
|
3.0
|
%
|
Arnold S. Lerner
|
|
76,204
|
(6)
|
0.6
|
%
|
Peter K. Markell
|
|
16,983
|
|
0.1
|
%
|
George Q. Nichols
|
|
19,670
|
|
0.2
|
%
|
Ronald L. Skates
|
|
38,603
|
(7)
|
0.3
|
%
|
Robert P. Story, Jr.
|
|
320,358
|
(8)
|
2.5
|
%
|
W. Nicholas Thorndike
|
|
52,664
|
(9)
|
0.4
|
%
|
Susan L. Wagner
|
|
17,786
|
|
0.1
|
%
|
Peter M. Folger
|
|
66,401
|
|
0.5
|
%
|
Peter D. Tobin
|
|
42,386
|
|
0.3
|
%
|
Eric J. Zimmerman
|
|
66,394
|
|
0.5
|
%
|
All Directors and Executive Officers as a Group
(14 persons)
|
|
2,213,282
|
|
17.1
|
%
|
T. Rowe Price Associates, Inc.
|
|
1,182,200
|
(10)
|
9.4
|
%
|
Wasatch Advisors, Inc.
|
|
640,155
|
(11)
|
5.1
|
%
|
Neuberger Berman
|
|
666,020
|
(12)
|
5.3
|
%
|
|
|
|
|
|
|
|
2
(1)
|
The information concerning
the amount of Common Stock of the Corporation beneficially owned by each of
the Directors and executive officers was furnished to the Corporation by each
such Director or executive officer. The address for the Directors and
executive officers is c/o Courier Corporation, 15 Wellman Avenue, North
Chelmsford, MA 01863.
|
|
|
(2)
|
Includes shares subject
to options exercisable within sixty days of the Record Date as follows: Mr.
Conway, 54,258 shares; Prof. Curley, 23,727 shares; Mr. Donahue, 25,227
shares; Mr. Hoff, 30,477 shares; Mr. Lerner, 25,227 shares; Mr. Markell,
14,727 shares; Mr. Skates, 28,227 shares; Mr. Story, 56,282 shares; Mr.
Thorndike, 4,758 shares; Ms. Wagner, 14,727 shares; Mr. Tobin, 22,682 shares;
Mr. Folger, 12,772 shares; Mr. Zimmerman, 1,519 shares; and all Directors and
executive officers as a group, 314,610 shares. For purposes of calculating
the percentage of shares outstanding with respect to each individual and the
group, the shares subject to such options have been treated as if they were
issued and outstanding only as to such individual or group.
|
|
|
(3)
|
Includes shares allocated
to individual accounts in the Courier Employee Stock Ownership Plan (the
ESOP) as follows: Mr. Conway, 9,162 shares; Mr. Story, 6,518 shares; Mr.
Tobin, 234 shares; Mr. Folger, 4,220 shares; and Mr. Zimmerman, 181 shares.
|
|
|
(4)
|
Includes 334,111 shares
owned by the James F. Conway, Jr. Trusts of which Mr. Conway III is a trustee
with shared voting and investment power as to these shares. Mr. Conways
address is c/o the Corporation, 15 Wellman Avenue, North Chelmsford, MA
01863.
|
|
|
(5)
|
Includes 13,500 shares
pledged by Mr. Hoff against a margin loan with UBS Financial Services, Inc.
|
|
|
(6)
|
Includes 5,062 shares
owned by Mr. Lerners wife, as to which shares Mr. Lerner disclaims
beneficial ownership.
|
|
|
(7)
|
Includes 900 shares
owned by family trusts of which Mr. Skates is a trustee with shared voting and
investment power as to these shares, but to which he disclaims beneficial
ownership. Mr. Skates children are the beneficiaries of those trusts.
|
|
|
(8)
|
Includes 4,050 shares
owned by Mr. Storys wife, as to which shares Mr. Story disclaims beneficial
ownership.
|
|
|
(9)
|
Includes 4,500 shares
owned by a family trust of which Mr. Thorndike is a trustee with shared
voting and investment power as to these shares, but to which he disclaims
beneficial ownership. Mr. Thorndikes grandchildren are the beneficiaries of
that trust. Also includes 1,250 shares owned by the Thorndike familys
charitable foundation, to which Mr. Thorndike has shared voting power, but to
which he disclaims beneficial ownership.
|
|
|
(10)
|
Based upon information
provided by T. Rowe Price Associates, Inc. (Price Associates) as of
November 19, 2007. The total shares held of 1,182,200 are owned by various
individual and institutional investors, including T. Rowe Price Small-Cap
Value Fund, Inc. (which owns 990,000 shares representing 7.8% of the shares
outstanding), for which Price Associates serves as investment adviser with
power to direct investments and/or power to vote the securities. Price
|
3
|
Associates has sole
dispositive power for the entire holding of 1,182,200 shares and has sole
voting power for 169,800 shares. For purposes of the reporting requirements
of the Securities Exchange Act of 1934, Price Associates is deemed to be a
beneficial owner of such securities; however, Price Associates expressly
disclaims that it is, in fact, the beneficial owner of such securities. The
address for Price Associates is 100 East Pratt Street, Baltimore, MD 21202.
|
|
|
(11)
|
Based upon the most
recent Form 13F filing with the Securities and Exchange Commission by Wasatch
Advisors, Inc. as of September 30, 2007, Wasatch Advisors, Inc. owned 640,155
shares. The address for Wasatch Advisors, Inc. is 1 South Main Street, Suite
800, Salt Lake City, UT 84133-1109.
|
|
|
(12)
|
Based upon information
provided by Neuberger Berman, LLC as of September 30, 2007, Neuberger Berman,
LLC owned 666,020 shares, with sole voting and dispositive power as to
473,000 of those shares and no voting or dispositive power as to the
remaining 193,020 shares which are held in various individual funds.
Neuberger Berman, LLC disclaims beneficial ownership as to all 666,020
shares. The address for Neuberger Berman, LLC is 605 Third Avenue, 2
nd
Floor, New York, NY 10158-3698.
|
ITEM 1:
ELECTION OF DIRECTORS
Pursuant
to the By-Laws, the Corporations directorships are divided into three classes,
consisting of Class A, Class B and Class C Directors. The term of each directorship is three years
and the terms of the three classes are staggered in such a manner that only one
class is elected in any one year. Three
Class A Directors are to be elected at the 2008 Annual Meeting. Each of the three Class A Directors will
serve until the 2011 Annual Meeting and until his/her successor shall have been
elected and shall have qualified or until his/her earlier death, incapacity,
resignation or removal. It is proposed
that Proxies not limited to the contrary will be voted to elect Edward J. Hoff,
Robert P. Story, Jr., and Susan L. Wagner as Class A Directors. Messrs. Hoff and Story, and Ms. Wagner are
presently Class A Directors having terms expiring at the 2008 Annual
Meeting. If some unexpected occurrence
should make necessary, in the judgment of the Board of Directors, the
substitution of some other person for any of the nominees, it is the intention
of the persons named in the Proxy to vote for the election of such other person
as may be designated by the Board of Directors.
Messrs.
Hoff and Story, and Ms. Wagner were previously elected by the stockholders.
The Board of Directors unanimously recommends a vote
FOR the three Director Nominees listed below.
Nominees for Election as Class A
Directors
Edward J. Hoff
Mr. Hoff,
age 52, has been a Director of the Corporation since 1989. He joined IBM as Vice President, Learning in
2001 and serves as a member of the IBM Senior Leadership Team. He was President
of Leadership Development Inc., a management development firm, from 1998 to
2001. He had been a Partner at The
Center for Executive Development from 1992 to 1998. If elected, Mr. Hoff will
serve as a Class A Director until the 2011 Annual Meeting.
Robert P. Story, Jr.
Mr. Story,
age 56, has been a Director of the Corporation since 1995. He was elected Executive Vice President and
Chief Operating Officer of Courier in November 2006. Mr. Story has operational responsibility for
Couriers publishing and
4
book manufacturing operations. He joined Courier in 1986 as Vice President
and Treasurer and served as Senior Vice President and Chief Financial Officer
from April 1989 through October 2006. If elected, Mr. Story will serve as a
Class A Director until the 2011 Annual Meeting.
Susan L. Wagner
Ms.
Wagner, age 58, has been a Director of the Corporation since November 1,
2004. She is Vice President, Strategy
and Insights, Pepsi-Cola Company, a position she has held since September
2006. Prior to that time she was Vice
President of Consumer and Market Knowledge, Procter and Gamble from 2005 to
2006, Vice President of Market Research, Personal Care Group for the Gillette
Company from 2002 to 2005 and Vice President of Strategic Market Intelligence,
Duracell, from 1998 to 2002. If elected,
Ms. Wagner will serve as a Class A Director until the 2011 Annual Meeting.
Directors
Continuing in Office
The following persons are incumbent Directors and
have unexpired terms as Class B and Class C Directors as indicated.
James F. Conway III
Mr. Conway,
age 55, has been a Director of the Corporation since 1988. Mr. Conway was elected Chairman of the
Corporation on September 22, 1994 and continues as President and Chief
Executive Officer. He had been Acting
Chairman, President and Chief Executive Officer since December 1992, and
President and Chief Operating Officer from 1988 to 1992. He is a Director of
Enterprise Bancorp Inc. Mr. Conway was previously elected as a Class B Director
to serve until the 2009 Annual Meeting.
Kathleen Foley Curley
Professor
Curley, age 56, has been a Director of the Corporation since 1995. She joined Boston University School of
Management as a Research Professor in 2002.
She had been
Senior Vice President and Chief Community Builder at Communispace Corporation
from 2000 to 2002 and Executive Director of Lotus Institute since 1999. Prior to her industry positions, she was a
tenured Professor at Northeastern University College of Business Administration
in Management Information Systems between 1982 and 1997. Professor Curley was
previously elected as a Class B Director to serve until the 2009 Annual
Meeting.
W. Nicholas Thorndike
Mr.
Thorndike, age 74, has been a Director of the Corporation since 1989. He is an independent trustee of the mutual
funds of Grantham, Mayo, and Van Otterloo (GMO). He has also served as a Trustee of
Massachusetts General Hospital from 1969 to 1999 and now serves as Honorary
Trustee, and was the Chairman of the Board from 1987 to 1992 and President from
1992 to 1994. Until December 1988, he
was Chairman and Managing Partner of Wellington Management Company. Mr.
Thorndike was previously elected as a Class B Director to serve until the 2009
Annual Meeting.
Arnold S. Lerner
Mr. Lerner,
age 77, has been a Director of the Corporation since 1989. He is a Director and Vice Chairman of
Enterprise Bancorp Inc. He was a partner
in twenty radio stations. Mr. Lerner was previously elected as a Class C
Director to serve until the 2010 Annual Meeting.
Peter K. Markell
Mr. Markell,
age 52, has been a Director of the Corporation since November 1, 2004. He joined Partners HealthCare System, Inc. as
Vice President for Finance in 1999. He had previously been a partner at Ernst
& Young LLP from 1988 to
5
1998. Mr. Markell was previously elected as a
Class C Director to serve until the 2010 Annual Meeting.
George Q. Nichols
Mr. Nichols,
age 78, has been a Director of the Corporation since 1995. He is Senior Vice President of Courier and
became Chairman of National Publishing Company, a wholly owned subsidiary of
Courier, in 2000. He had previously been
President of National Publishing Company since 1976. Mr. Nichols was previously elected as a Class
C Director to serve until the 2010 Annual Meeting.
Ronald L. Skates
Mr. Skates,
age 66, has been a Director of the Corporation since 2003. He is a private investor. From 1989 through
1999, he was president and chief executive officer of Data General Corporation,
a computer and storage manufacturing company. He joined Data General in 1986
and was elected a director and executive vice president and chief operating
officer in 1988. He retired in 1999 when EMC Corp. acquired the company. Prior
to joining Data General, Mr. Skates was a certified public accountant and an
audit partner with Price Waterhouse & Co. He is a director of Gilbane
Corporation, Raytheon Company and State Street Corporation. Mr. Skates is a
trustee of Massachusetts General Physicians Organization, Inc. Mr. Skates was
previously elected as a Class C Director to serve until the 2010 Annual
Meeting.
Richard K. Donahue
(Retiring Director)
Mr. Donahue, age 80, has
been a Director of the Corporation since 1995.
He retired as Vice Chairman of NIKE, Inc. of Beaverton, Oregon and as a
member of the NIKE Board of Directors, having served since 1977. He previously served as President and Chief
Operating Officer of NIKE, Inc. from 1990 to 1994. He was a partner in the law firm of Donahue
& Donahue Attorneys, P.C. and is presently retired. Mr. Donahue was previously elected as a Class
A Director to serve until the 2008 Annual Meeting. He
will be retiring effective
January 16, 2008 when his term ends.
CORPORATE
GOVERNANCE
The Corporations
Corporate Governance Guidelines (attached as Exhibit A), the charters of the
Nominating and Corporate Governance Committee, the Audit Committee, and the Compensation
and Management Development Committee, the Corporations Business Conduct
Guidelines, and the Environmental, Health and Safety Policy are available on
the Corporations website at www.courier.com.
Printed copies are available free of charge by contacting General
Counsel, Courier Corporation, 15 Wellman Avenue, North Chelmsford, MA 01863.
Code of Ethics
On
November 4, 2003, the Board of Directors adopted, and subsequently amended on
September 18, 2007, The Courier Corporation Business Conduct Guidelines for all
its directors, officers and employees.
The Courier Corporation Business Conduct Guidelines have been posted on
the Corporations website at www.courier.com.
Board Meetings and
Committees
The
Board of Directors of the Corporation held a total of eight meetings during the
fiscal year ended September 29, 2007.
The Board of Directors has established the following separately
designated standing committees: an Audit and Finance Committee, a
6
Compensation and Management Development
Committee and a Nominating and Corporate Governance Committee.
Audit and Finance Committee
The
Audit and Finance Committee (the Audit Committee) consists of Messrs. Lerner,
Markell, and Skates. Mr. Skates serves
as Chairperson of the Audit Committee. The Board of Directors has determined
that Mr. Skates and Mr. Markell each meet all of the qualifications of an Audit
Committee Financial Expert, as defined in Item 407(d)(5) of Regulation S-K
under the Securities Exchange Act of 1934.
All the members of the Audit Committee are independent, under the
rules of the National Association of Securities Dealers and the
Commission. The functions of the Audit
Committee include appointment and oversight of independent auditors for the
Corporation; determination of compensation payable to the independent auditors;
consultation with the Corporations independent auditors regarding the plan of
audit; review, in consultation with the independent auditors, of their audit
report and management letter; and review of reports and recommendations of the
Corporations internal audit department. The Audit Committee has established
procedures for the receipt, retention and treatment of complaints received
regarding accounting, internal accounting controls or auditing matters. These procedures, along with the Audit
Committee Charter are available to stockholders on the Corporations website at
www.courier.com. The Audit Committee held five meetings during the last fiscal
year. A part of each of the meetings was
held with representatives of the Corporations independent auditors outside of
the presence of management. The Audit
Committee also met separately with the Corporations internal audit manager at
each of these formal meetings.
Compensation and Management
Development Committee
The Compensation and Management Development Committee
(the Compensation Committee) consists of Messrs. Donahue, Hoff, Lerner,
Markell, Skates, and Thorndike, Ms. Wagner and Professor Curley. Mr. Hoff serves as Chairperson of the
Committee. All the members of the
Compensation Committee are independent under the rules of the National
Association of Securities Dealers and the Commission. The Compensation Committee administers the
Corporations executive compensation programs and approves the compensation of
executive officers. The Compensation
Committee Charter is available to stockholders on the Corporations website at
www.courier.com. The Committee meets
each September and November to formally review executive compensation and may
meet at other times during the year on compensation matters.
At its meeting in September of
each year, the Compensation Committee reviews compensation data provided by the
Vice President of Human Resources to establish compensation targets for the
executives for the upcoming fiscal year.
The Compensation Committee has not engaged any compensation consultant
to assist it in its compensation decisions.
As part of the process of setting executive compensation targets, the
Compensation Committee reviews the following:
|
Compensation tally sheets
for the Chief Executive Officer (CEO) and each executive as prepared by the
Vice President of Human Resources. The tally sheets provide a four-year
review of all compensation earned by the executives under our Executive
Compensation Program, including salary, bonuses, perquisites, company
contributions made on executives behalf to the Corporations retirement plan
and deferred compensation plan, the value of stock options and restricted
stock grants, and potential future payments under long-term plans and change
in control arrangements.
|
7
|
Compensation data of other
companies of similar size or in similar industries as the Corporation. For
fiscal year 2007, the Compensation Committee reviewed compensation data of
executives from our peer group, which consisted of Banta Company; Bowne &
Co.; Cadmus Communications Corporation; Ennis Business Forms, Inc.; The
Standard Register Company; Thomas Nelson, Inc. and John Wiley & Sons.
Inc.; and survey data as provided through The Survey Group 2006 Management
Compensation Survey, which is a survey of compensation from 296
Massachusetts-based companies, reported on an aggregate basis based on size,
industry, and geographic location without reference to company names.
|
Each
year at the September meeting, the Compensation Committee also grants stock
options and restricted stock awards to the CEO and other executives as part of
their compensation package for the next fiscal year.
At
its November meeting each year, following its review of the prior fiscal years
operating results, the Compensation Committee approves awards earned under our
Executive Compensation Program for the fiscal year just ended. In addition, the Compensation Committee
reviews the compensation targets it established for the CEO and other
executives at the September meeting and formally approves the compensation of
the CEO and the proposed compensation for the other executives for the new
fiscal year. The Compensation Committee
also sets the performance targets for the new fiscal years performance-based
incentive plans.
Managements Role in the Compensation-Setting Process
. The CEO provides his evaluation of the
performance of the other executives to the Compensation Committee. Using tally sheets and peer group and company
survey data as prepared by the Vice President of Human Resources described
above, he recommends salary, non-equity incentive compensation, and equity
compensation for the other executives, and recommends the business performance
targets and objectives for approval by the Compensation Committee in connection
with incentive compensation plans. The
CEO does not participate in discussions of his compensation by the Compensation
Committee.
Nominating and Corporate
Governance Committee
The
Nominating and Corporate Governance Committee (the Nominating Committee)
consists of Messrs. Donahue, Hoff, Lerner, Markell, Skates, and Thorndike, Ms.
Wagner and Professor Curley. Professor
Curley serves as Chairperson of the Nominating Committee. All the members of the Nominating Committee
are independent under the rules of the National Association of Securities
Dealers and the Commission. The
Nominating and Corporate Governance Committee Charter is available to
stockholders on the Corporations website at www.courier.com.
The Nominating Committee, on behalf of the Board of
Directors (the Board), is responsible for identifying individuals qualified
to become Board members and recommending to the Board Director nominees for
election, including nominees to be elected or re-elected as Directors at each
annual meeting of stockholders, as more fully detailed in the Nominating
Committee Charter. The Nominating Committee
also periodically reviews and monitors the Corporations performance against
the corporate governance guidelines established by the Committee. Each of the Directors is in compliance with
the stock ownership requirements set forth in the corporate governance
guidelines. Pursuant to the Nominating
Committees Charter, the Nominating Committee
8
will review and evaluate Director candidates recommended by
stockholders as more fully set forth therein.
The
Nominating Committee recommended that Messrs. Hoff and Story, and Ms. Wagner
each be nominated for election to serve as Class A Directors until the 2011
Annual Meeting. The Nominating Committee
held two meetings during the last fiscal year.
Participation at Meetings
Each
Director attended at least 75% of the total number of meetings held by the
Board of Directors and any committees on which he or she served during fiscal
year 2007. The Corporation has a formal policy requiring members of the Board
to attend our annual meeting, and each of the Directors attended the 2007
Annual Meeting.
Contacting Members of the Board
of Directors
The policy of the Board of Directors is that
stockholders of the Corporation may contact the Board of Directors, including the
Chairman of the Board, the independent Directors as a group, or any individual
Director, by writing to the Board of Directors c/o, Courier Corporation,
Attention: Compliance Officer, 15 Wellman Avenue, North Chelmsford, MA 01863. Such writing must clearly specify the name of
the individual Director or group of Directors to whom such writing is
addressed.
If you wish to contact the Audit Committee to report
complaints or concerns regarding accounting, internal accounting controls or
auditing matters, you may do so by writing to the Compliance Officer, Courier
Corporation, 15 Wellman Avenue, North Chelmsford, MA 01863. You are welcome to make such reports
anonymously, but we prefer that you identify yourself so that we may contact
you for additional information if necessary or appropriate.
We recommend that all correspondence be sent via
certified U.S. mail, return receipt requested.
All such correspondence received in this manner will be forwarded to the
relevant Director or group of Directors or other addressee.
Director
Independence
The Board of Directors has determined that each of
Messrs. Donahue, Hoff, Lerner, Markell, Skates and Thorndike, Prof. Curley and
Ms. Wagner is an independent director in accordance with corporate governance
rules of the National Association of Securities Dealers as a result of having
no relationship with the Corporation other than (1) serving as a Director and a
Board of Director committee member, (2) receiving related fees as disclosed in
this Proxy Statement, and (3) having beneficial ownership of the Corporations
Common Stock as disclosed in the section of this Proxy Statement entitled Voting
Securities Security Ownership of Certain Beneficial Owners and Management. Therefore, the Corporation currently has a
majority of independent directors.
Meetings
of Independent Directors
Independent directors of the Corporation regularly
meet in executive session outside the presence of management. The presiding director for these meetings is
Mr. Thorndike. Any interested parties
who wish to make their concerns known to the
9
independent directors may
avail themselves of the procedures listed above in the section of this Proxy
Statement entitled Contacting Members of the Board of Directors.
Related Party
Transactions
Under
the terms of the Corporations Audit Committee Charter and its Business Conduct
Policy, information about transactions involving related persons would be
reviewed by the independent directors of the Corporation. Related persons include the Corporations
directors and executive officers, as well as immediate family members of
directors and officers. If the
determination is made that a related person has a material interest in any
transaction of the Corporation, then the Corporations independent directors
would review, and if it were in the best interest of the Corporation, approve
or ratify it. In addition, the
transaction would be required to be disclosed in accordance with the Commissions
rules. No such transactions took place.
Directors
Compensation
On January 17,
2007, the Corporation paid its non-employee Directors (Messrs. Donahue, Hoff,
Lerner, Markell, Skates and Thorndike, Prof. Curley and Ms. Wagner) an annual
retainer of $25,000 for calendar year 2007.
During fiscal year 2007, they also received meeting fees of $1,250 per
meeting attended of the Board of Directors and any committee meetings of the
Board of Directors. The Corporation paid annual retainer fees to non-employee
Directors who serve as Chairpersons of Committees of the Board of Directors as
follows: Compensation Committee,
$10,000; Audit Committee, $10,000; and Nominating Committee, $5,000. Non-employee directors may receive additional
fees for service on executive, strategic initiative, shareholder value and
other special committees that the Board of Directors may from time to time
establish. Total compensation earned for
fiscal 2007 for each of the non-employee Directors is detailed in the table
below.
For fiscal 2007, the
non-employee Directors were allowed, at their election, to receive all or
one-half of their annual retainer fees for services as Directors and as
Chairpersons of Committees (annual retainer fees) in the form of stock units
or shares of Common Stock pursuant to the Corporations 2005 Stock Equity Plan
(the Stock Equity Plan). On January
17, 2007, an aggregate of 4,338 shares were awarded to the following Directors
who elected to participate in the Stock Equity Plan: Mr. Donahue, 638 shares; Mr. Hoff, 893
shares; Mr. Markell, 638 shares; Mr. Skates, 893 shares; Mr. Thorndike, 638
shares; and Ms. Wagner, 638 shares. In
addition, the non-employee Directors receive an annual stock option award
granted at fair market value on the date of each annual meeting of
stockholders. This award is valued at
$50,000 based on the Black-Scholes option pricing model. Options for 4,758 shares of Common Stock
each, or an aggregate of 38,064 shares, were granted on January 17, 2007 at an
exercise price of $39.18 per share to all non-employee Directors. All such options have a term of five years
from the date of grant, are exercisable immediately and (except for transfers
to or for the benefit of the Directors immediate family) are non-transferable
otherwise than by will or the laws of descent and distribution. Both the stock grant and option awards were
fully vested on the date of grant.
10
Directors
Compensation Table - 2007
|
|
|
|
|
|
|
|
|
|
Change in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Value and
|
|
|
|
|
|
|
|
Fees
|
|
|
|
|
|
Non-Equity
|
|
Non-qualified
|
|
All
|
|
|
|
|
|
Earned or
|
|
|
|
|
|
Incentive Plan
|
|
Deferred
|
|
Other
|
|
|
|
|
|
Paid in
|
|
Stock
|
|
Option
|
|
Compensation
|
|
Compensation
|
|
Comp
|
|
Total
|
|
Name of Director
|
|
Cash ($)(1)
|
|
Awards($)(2)
|
|
Awards($)(3)(4)
|
|
($)(5)
|
|
Earnings(5)
|
|
($)(5)
|
|
($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kathleen Foley
Curley
|
|
45,000
|
|
0
|
|
50,000
|
|
0
|
|
0
|
|
0
|
|
95,000
|
|
Richard K.
Donahue
|
|
12,500
|
|
25,000
|
|
50,000
|
|
0
|
|
0
|
|
0
|
|
87,500
|
|
Edward J. Hoff
|
|
13,750
|
|
35,000
|
|
50,000
|
|
0
|
|
0
|
|
0
|
|
98,750
|
|
Arnold S. Lerner
|
|
46,250
|
|
0
|
|
50,000
|
|
0
|
|
0
|
|
0
|
|
96,250
|
|
Peter K. Markell
|
|
21,250
|
|
25,000
|
|
50,000
|
|
0
|
|
0
|
|
0
|
|
96,250
|
|
Ronald L. Skates
|
|
21,250
|
|
35,000
|
|
50,000
|
|
0
|
|
0
|
|
0
|
|
106,250
|
|
W. Nicholas
Thorndike
|
|
13,750
|
|
25,000
|
|
50,000
|
|
0
|
|
0
|
|
0
|
|
88,750
|
|
Susan L. Wagner
|
|
13,750
|
|
25,000
|
|
50,000
|
|
0
|
|
0
|
|
0
|
|
88,750
|
|
(1)
|
This column includes Board and Committee meeting
fees paid in cash. It also includes annual retainers and committee retainers.
|
|
|
(2)
|
This
column reflects the value of the stock grants that were awarded to those
Directors who chose to participate in the Stock Equity Plan and receive their
annual retainer and committee retainer in shares of stock.
|
|
|
(3)
|
This
column reflects the Black-Scholes value of the annual stock option awards
granted at the closing market price on January 17, 2007, the date of the
annual meeting of stockholders.
|
|
|
(4)
|
Non-employee
Directors had the following aggregate stock options outstanding at the end of
fiscal 2007:
|
|
|
Stock Options Outstanding (#)
|
|
|
|
Kathleen Foley Curley
|
|
23,727
|
Richard K. Donahue
|
|
25,227
|
Edward J. Hoff
|
|
30,477
|
Arnold S. Lerner
|
|
25,227
|
Peter K. Markell
|
|
14,727
|
Ronald L. Skates
|
|
28,227
|
W. Nicholas Thorndike
|
|
4,758
|
Susan L. Wagner
|
|
14,727
|
(5)
|
These
columns were intentionally left blank.
The non-employee Directors do not receive non-equity incentive plan
compensation, pension, or non-qualified deferred compensation, nor did they
receive any other form of compensation.
|
AUDIT COMMITTEE
REPORT
The
primary purpose of the Audit Committee is to assist the Board of Directors in
its general oversight of the Corporations financial reporting process.
Management
is responsible for the preparation, presentation, and integrity of the
Corporations financial statements, accounting and financial reporting
principles, internal controls, and procedures designed to ensure compliance
with accounting standards, applicable laws, and regulations. The Corporations independent auditors,
Deloitte & Touche LLP, are responsible for performing an independent audit
of the consolidated financial statements and expressing an opinion on the
conformity of those financial statements with generally accepted accounting
principles.
11
The
Audit Committee has reviewed and discussed the audited financial statements of
the Corporation for the fiscal year ended September 29, 2007 with the
Corporations management and has discussed with Deloitte & Touche LLP the
matters required to be discussed by Statement on Auditing Standards Board
Standard No. 61 as amended, Communication with Audit Committees. In addition, Deloitte & Touche LLP has
provided the Audit Committee with the written disclosures and the letter
required by the Independence Standards Board Standard No. 1, Independence
Discussions with Audit Committees, and the Audit Committee has discussed with
Deloitte & Touche LLP their independence.
Based
on these reviews and discussions, the Audit Committee recommended to the Board
of Directors that the audited financial statements be included in the
Corporations Annual Report on Form 10-K for the fiscal year ended September
29, 2007, for filing with the Securities and Exchange Commission.
Ronald
L. Skates Arnold S.
Lerner Peter K. Markell
COMPENSATION DISCUSSION
AND ANALYSIS
Compensation
Philosophy
The
goals of our Executive Compensation Program are to:
|
attract and retain high quality
management talent and to motivate them to build and sustain value for
shareholders;
|
|
provide aggregate compensation
opportunities that, when performance goals are achieved, will be comparable
to those provided by other companies with revenues and operating
characteristics similar to us; and
|
|
establish for employees in
management positions a significant risk/reward compensation structure through
incentive pay plans.
|
Our
Executive Compensation Program is designed to accomplish these goals by
providing an annual incentive to motivate executives to achieve our annual
earnings goals and two long-term incentives tying executives compensation to
the results of the business decisions they make and to the creation of
shareholder value over the long term.
Compensation
Elements
The
cash- and stock-based, short- and long-term components of our Executive Compensation
Program begin with a total compensation amount established for each executive
officer. In determining total
compensation amounts, the Committee considers the following:
|
compensation data of companies of a
similar revenue size, in similar markets and in regional areas in which we
compete for executive talent. Those companies are listed above on page 8.
However, there is no attempt to benchmark total compensation of executive
officers to particular levels (e.g., median, salary midpoint) within the
survey group data. The Committee reviews the compensation data to make sure
that the total compensation paid to our executives remain competitive.
|
12
|
the total compensation earned by
executives over the past four years as provided on tally sheets provided to
the Committee. The tally sheet information provides confirmation to the
Committee that our compensation program is indeed performance-based.
|
|
the Corporations initiatives for
the new fiscal year, and the challenges in achieving those initiatives.
|
|
the performance of our executives.
|
|
individual job responsibilities of
our executives.
|
Our
Executive Compensation Program is designed such that three of the four
compensation components are variable; therefore, total compensation can
fluctuate significantly year-to-year if performance targets are exceeded,
achieved, or not attained.
Total
compensation, as defined in our plan, is comprised of a fixed pay component,
which is base salary, and up to three variable pay components, which consist of
an annual cash bonus, a long-term stock incentive, and a long-term performance
incentive. The Committee uses as a guide
a target pay mix for the four compensation components. For the CEO, the target pay mix is 45 percent
in fixed pay, 20 percent in annual cash bonus, 20 percent in the long-term
stock incentive, and 15 percent in a long-term performance incentive. For the other executive officers, the target
pay mix is 50 percent in fixed pay, 20 percent in annual cash bonus, 15 percent
in the long-term stock incentive, and 15 percent in the long-term performance
incentive. The Committee believes it is reasonable and appropriate for
executive officers to have at least half of their total compensation in the
form of variable pay. The Committee further believes it is appropriate for the
CEO to have a higher percentage of his total compensation in the form of
variable pay because of the importance of his role to grow the Corporation and
increase total shareholder returns. The
actual pay mix among all of these components may fluctuate year to year among
individual executives.
The
total compensation for fiscal 2007 for all of the executives, with the
exception of Messrs. Nichols, Zimmerman, and Tobin, consisted of the four
compensation components described above.
In light of Mr. Nichols retirement plans, the Committee did not believe
it was appropriate to award him any long-term incentive awards. Mr. Zimmerman, in his role as Vice President
of Publishing, has his entire long-term incentive delivered as a long-term
stock incentive, rather than a performance incentive, to encourage greater
stock ownership and because the publishing segment is expected to have less
impact on our return on assets (ROA) and more impact on our long-term
shareholder value. Mr. Tobin shifted
roles in fiscal 2007, upon the announcement of Mr. Nichols intentions to
retire, to focus on key customer relationships for National Publishing
Company. Mr. Tobins entire long-term
incentive is delivered as a long-term stock incentive because as in the case of
Mr. Zimmerman, Mr. Tobins role is expected to have more impact on our
long-term shareholder value.
There is
some disparity between the total compensation paid to our top three named executive
officers and the other three named executive officers. This is primarily because Messrs. Conway,
Story and Nichols have a long tenure with us while the others have been
promoted to their executive management roles only in recent years.
1.
Base Salary
. The base salary is designed to compensate
executives for fulfilling their job responsibilities, their expected
contribution to our performance, and to aid in their attraction and retention. The base salary for Mr. Conway was increased
by 9 percent for fiscal 2007 partly because of our strong fiscal year 2006
performance and partly
13
because compensation data of CEOs in
companies of similar size or in similar industries show that Mr. Conways base
salary for 2006 was below the median.
Mr. Story received a base increase of 15 percent and Mr. Folger received
a base increase of 25 percent in recognition of their increase in job
responsibilities due to their promotions to Chief Operating Officer and Chief
Financial Officer respectively. Mr.
Nichols received a 4 percent increase in his salary for fiscal 2007. Mr. Zimmerman received an 11 percent increase
in his fiscal 2007 salary, which was reflective of his expanded role upon the
acquisition of a new publishing subsidiary.
Mr. Tobin received no base increase for fiscal 2007.
At its
meeting in November 2007, the Committee approved a 3 percent base salary
increase for fiscal year 2008 for all executives, including the CEO. In light of the significant adjustment in
base salaries for most executives in fiscal 2007, the Committee does not
believe there is any need to provide for any increases beyond a 3 percent
increase to cover increases in cost of living.
2.
Annual Cash Bonus.
The annual cash bonus is intended
to promote the achievement of our business goals and annual earnings
objectives, and is entirely based on quantitative objectives established by the
Committee at its November meeting. An annual
cash bonus target is set by the Committee for each executive for the fiscal
year, which corresponds to an earnings target.
If the earnings target is met for the fiscal year, the executive earns
his or her annual cash bonus target for the year. The cash bonus plan provides for the actual
amount of annual cash bonus awards to vary from 0 percent of target to 200
percent of target depending on the Corporations actual earnings for the fiscal
year. No annual cash bonus is earned
unless a minimum earnings threshold is achieved, at which an executive earns 25
percent of the annual cash bonus target.
Earnings targets are set in 25 percent increments, from 25 percent to a
maximum of 200 percent, at which an executive may earn that percentage of his
annual cash bonus target based on the earnings target.
All executives
had a portion of their annual cash bonus for fiscal 2007 based on an earnings
per share target for the Corporation.
Earnings growth is a key measure that we use to measure our performance
year to year. Therefore, the Committee
believes it is appropriate to use an earnings per share measure for the annual
cash bonus. With the exception of
Messrs. Zimmerman and Tobin, the CEO and other named executives had 100 percent
of their annual bonus based on our achieving the earnings per share
target. Mr. Zimmerman had one-third of
his annual cash bonus based on our achieving the earnings per share
target. The other two-thirds of his cash
bonus was based on a pretax income target for our publishing segment, which the
Committee believes is an appropriate measure since he manages just this segment
of the Corporation and pretax income of the segment is a primary measurement of
his performance for the year. Mr. Tobin
had one-half of his annual cash bonus based on our achieving the earnings per
share target. The other one-half of his
cash bonus was based on a pretax income target for our book manufacturing
segment, which the Committee believes is an appropriate measure since Mr. Tobin
managed this segment of the Corporation for a portion of the year before shifting
to his current role in managing key account relationships for National
Publishing Company.
14
The
earnings targets for fiscal 2007 are listed below:
|
|
0%
|
|
25%
|
|
50%
|
|
75%
|
|
100%
|
|
125%
|
|
150%
|
|
175%
|
|
200%
|
Earnings Per
Share
|
< =
|
$
|
2.04
|
|
$
|
2.05
|
|
$
|
2.10
|
|
$
|
2.15
|
|
$
|
2.20
|
|
$
|
2.25
|
|
$
|
2.30
|
|
$
|
2.35
|
|
$
|
2.40
|
Book
Manufacturing Pretax Income ($000 omitted)
|
< =
|
$
|
34,174
|
|
$
|
34,175
|
|
$
|
34,850
|
|
$
|
35,525
|
|
$
|
36,200
|
|
$
|
36,875
|
|
$
|
37,550
|
|
$
|
38,225
|
|
$
|
38,900
|
Publishing
Segment Pretax Income ($000 omitted)
|
< =
|
$
|
9,099
|
|
$
|
9,100
|
|
$
|
9,450
|
|
$
|
9,800
|
|
$
|
10,150
|
|
$
|
10,500
|
|
$
|
10,850
|
|
$
|
11,200
|
|
$
|
11,550
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Based on
our performance in fiscal 2007, all of the executives earned zero percent of
their annual cash bonus target that was based on the earnings per share measure
because the minimum earnings threshold target of $2.05 was not achieved. Mr. Zimmerman earned zero percent of his
bonus award that was based on the publishing segment pretax income target for
fiscal 2007 since the minimum threshold earnings target of $9.1 million was not
achieved in 2007. Therefore, Messrs. Conway, Story, Folger, Nichols, and
Zimmerman earned no bonus award for fiscal 2007. Mr. Tobin earned zero percent
of the annual cash bonus target that was based on the earnings per share
measure; he earned 100 percent of his bonus that was based on the book
manufacturing segment pretax income measure because the 100 percent earnings
target for that segment was achieved for fiscal 2007.
While
Mr. Nichols was not entitled to receive a cash bonus under our annual cash
bonus plan for fiscal 2007, the Committee nevertheless awarded him a special
cash award of $30,000 in recognition of his 30 years of extraordinary service
with the Corporation as he transitions toward retirement in the coming
year. In the case of Mr. Folger, the
Committee determined that the compensation paid to him is significantly below
what is paid to Chief Financial Officers of companies in our peer group. Accordingly, the Committee awarded him a
discretionary cash bonus of $20,000.
Earnings
targets for the fiscal 2008 annual cash bonus will continue to be based on
earnings per share and pretax income targets established by the Committee.
Change
in Control
. In the
event we undergo a change in control, executives are entitled to receive a pro
rata portion of their annual cash bonus target.
It is the Committees belief that making such awards pro rata based on
the elapsed time period and target amount is a fair and reasonable manner in
which to treat executives who, as a result of the change in control, may not
have the opportunity to earn all of this incentive.
3. Long-Term Stock
Incentive (LTSI).
The LTSI is
comprised of awards of stock options and restricted stock under the Courier
Corporation Amended and Restated 1993 Stock Incentive Plan approved by
shareholders in November 2004. The Committee believes that stock-based awards
closely align the interests of the executive officers with those of our
shareholders. The value of stock option
awards cannot be realized unless an appreciation in the price of our Common
Stock occurs over a number of years.
Similarly, the value of restricted stock awards will fluctuate with the
value of our Common Stock. We use a mix
of options and restricted stock in order to control our annual run rate and
minimize dilution.
Stock Option Awards
. One-half of the compensation value under the
LTSI is delivered as a stock option. The
Committee uses the Black-Scholes option-pricing model to determine the number
of shares that correspond to the compensation value to be
15
delivered through a stock
option. The Committee awards the stock
option with an exercise price equal to the fair market value of the Corporations
Common Stock on the date of the award.
Beginning with awards for fiscal 2006, the Committee granted stock
option awards with a five-year term.
Stock option awards granted as part of the LTSI vest in equal amounts
annually over a three-year period.
Restricted Stock Grants
. The other half of the compensation value to
be delivered under the LTSI is awarded as a restricted stock grant which vests
in full three years following the date of the grant. Executives receive dividends on unvested shares
during the restricted period in the same amount and manner as are paid to all
shareholders. In addition, we provide
tax assistance to the executive of up to 30 percent of the taxable value
realized upon vesting of the restricted stock grant in order to encourage our
executives to retain their shares of our Common Stock and not to sell them to
meet tax obligations that result from the vesting.
In
addition to the LTSI awarded under the Executive Compensation Program, the
Committee may also make discretionary stock awards for special purposes. In fiscal 2007, the Committee awarded a
restricted stock award in November 2006 to Mr. Conway in recognition of our
strong fiscal 2006 earnings performance; to Mr. Story in recognition of his
promotion to Executive Vice President and Chief Operating Officer; and to Mr.
Folger in recognition of his promotion to Senior Vice President and Chief
Financial Officer. A description of
these awards including the number of shares granted to these individuals is set
forth in the Grant of Plan-based Awards table.
Change in
Control
. If we should undergo
a change in control, all outstanding restricted stock grants for the executives
will vest and all outstanding stock options will become fully exercisable. It is the Committees belief that
accelerating such awards is a fair and reasonable manner in which to treat
executives who, as a result of the change in control, could otherwise forfeit
the value of these incentives.
4.
Long-Term Performance Incentive (LTPI)
. The LTPI is a cash award earned by executive
officers based upon our achieving an average return on asset (ROA) target over
a three-year performance period as compared against our peer groups average
ROA over a comparable three-year performance period. The Committee believes the three-year ROA
measure is an effective way to encourage executives to manage our operations
responsibly and to invest in our business wisely so that our ROA exceeds the
performance of our industry peers over the long-term. ROA is a financial
measure typically used in industries where investments in equipment are a
critical component of performance.
The LTPI
earned at the close of fiscal 2007 is the 2005 LTPI, which covers the
three-year performance period of fiscal 2005, 2006, and 2007. The award is earned if our average ROA for
this period exceeds by 5 percent or more our peer groups average ROA for a
comparable period. Since our average ROA
for this three-year period was 11.9 percent and our peer groups average ROA
for the comparable period was 5.3 percent, the 2005 LTPI was earned. The peer group of companies for the 2005
LTPI originally consisted of Banta Company; Bowne & Co.; Cadmus
Communications Corporation; Ennis Business Forms, Inc.; The Standard Register
Company; Thomas Nelson, Inc.; and John Wiley & Sons, Inc. The Committee selects the peer group of
companies based on a variety of factors including market capitalization, annual
revenues, industry, and number of employees.
During the three-year performance period of the 2005 LTPI, Thomas
Nelson, Inc. became a privately owned company in 2006, Banta Corporation was
acquired by R.R. Donnelley & Sons in 2006; and Cadmus Communications
Corporation was acquired by
16
Cenveo, Inc. in 2007. As a result, these companies were excluded in
the calculation of the three-year Peer Group ROA.
The 2005
LTPI awards were approved at the Committees November 2007 meeting and paid out
soon thereafter. The 2006 LTPI which
covers the three-year period of fiscal 2006, 2007, and 2008, and the 2007 LTPI
which covers the three-year period of fiscal 2007, 2008, and 2009 will be
earned if our average ROA exceeds by 5 percent or more our peer groups for the
comparable three-year period. The peer
group of companies for fiscal 2006 and 2007 LTPI will consist of Bowne &
Co.; Ennis Business Forms, Inc.; The Standard Register Company; John Wiley
& Sons. Inc.; Consolidated Graphics; Scholastic, Inc. and Borders Group,
Inc.
Change
in Control
. In the
event we undergo a change in control, executives are entitled to receive a pro
rata portion of their target LTPI awards.
It is the Committees belief that making such awards pro rata based on
the elapsed time period is a fair and reasonable manner in which to treat
executives who, as a result of the change in control, may not have an
opportunity to earn these incentives.
Other Benefits and
Perquisites
Executives
generally receive the same healthcare benefits, life and disability insurance,
and vacation benefits as other employees.
The executives participate in the same manner as all employees in the
Courier Profit Sharing and Savings Plan, which is our retirement plan. The plan provides all non-union employees
with a 401k savings feature, a company matching contribution, and an annual
profit sharing contribution.
We
provide executives with certain limited perquisites and other personal benefits
that the Committee believes are reasonable and appropriate for attracting and
retaining executives for key positions.
Executives receive a monthly car allowance, with Mr. Conway receiving a
car allowance of $1,408 per month and the other named executive officers
receiving an allowance of $1,179 per month.
This amount is normally adjusted annually in January by the same
percentage as the percentage increase in the annual IRS mileage reimbursement
rate. We pay the annual dues, plus tax
assistance on the value of the dues, associated with a country club membership
for Messrs. Conway and Nichols, other club membership dues for Messrs. Conway
and Nichols, and the annual tax preparation and planning fees for Mr.
Nichols. Messrs. Conway, Nichols, and
Story participate in the Courier Corporation Deferred Compensation Program,
which is a non-qualified, unfunded plan that provides for an annual award. The annual award is the difference between
what our annual profit sharing contribution would have been but for the
IRS-mandated compensation maximum and the actual profit sharing contribution
made to the participants account in the Courier Profit Sharing and Savings
Plan for the plan year (which is a calendar year). Interest is credited annually based on the
investment return of one of four mutual funds within the Courier Profit Sharing
and Savings Plan that the participant elects prior to the beginning of the plan
year. Messrs. Conway, Nichols, and Story
make no contributions to the plan.
Senior Executive
Severance Program
Our
Board of Directors determined that it is appropriate to reinforce and encourage
the continued attention and dedication of senior members of our management to
their assigned duties without distraction in potentially disturbing
circumstances arising from the possibility of a change in control. In December 2005, the Board of Directors
17
approved the Amended and Restated Senior
Executive Severance Program which sets forth the severance compensation which
we will pay to certain executives in the event that the executives employment
with us terminates under certain circumstances if we should undergo a change in
control.
Messrs. Conway,
Nichols, Story, Folger, Zimmerman, and Tobin are participants in our Senior
Executive Severance Program (the Severance Program). In accordance with the Severance Program, if
we should undergo a change in control, as defined in the Severance Program,
while one of these individuals is an employee, and his employment is
subsequently terminated for reasons other than death, disability, or
termination for cause, he shall be entitled to a severance payment and
continuation of participation in our group health plan until the end of the
second calendar year following the year of termination.
The
occurrence or potential occurrence of a change in control transaction creates
uncertainty regarding the continued employment of executive officers; and often
times, such transactions are immediately followed by significant organizational
changes, especially at the senior officer level. In order to encourage executive officers to
remain with us to create shareholder value and to obtain the highest value
possible should we be acquired in the future, we have agreed to provide the
severance benefits described above should their employment be terminated
following the transaction. In order to
give the executives comfort that the obligations under the Severance Program
will be fulfilled by any acquirer, we have provided for payment of severance
benefits on termination by the executive for good reason (e.g., as a result
of changes in title, responsibilities or salary), and which includes
termination by the individual for any reason during a 30-day window commencing
on the first anniversary of the change in control. We provided this window period whereby the executive
can resign and receive his severance to encourage the executive to remain
employed for at least one year after the transaction to provide transition
assistance to the acquirer. No tax
gross-up payment is provided under the Severance Program because of cost
consideration. It is the Committees
belief that the benefits provided under our Severance Plan are consistent with
severance benefits provided by other companies of similar size and in similar
industries as us.
Supplemental Retirement
Benefit Agreement
In
June 1992, our Board of Directors approved a Supplemental Retirement Benefit
Agreement with Mr. Nichols providing for a supplemental retirement benefit upon
his retirement to encourage Mr. Nichols to remain with us at least until age
70. The annual amount of the benefit Mr.
Nichols is to receive is $70,000 upon retirement at or over age 70. Mr. Nichols is currently age 78, and is still
employed by us. This benefit is more
fully described in the section titled, Pension Benefits.
Other
than Mr. Nichols, we have not entered into a supplemental retirement benefit
agreement with any executive.
Employment
Agreements
In
light of Mr. Nichols importance to the success of our subsidiary, National
Publishing Company, we entered into an employment agreement with Mr. Nichols
effective as of March 3, 1993. Mr.
Nichols became Chairman of National Publishing Company in 2000, having served
as President since 1976. Mr. Nichols
currently works full time. The
employment agreement provides that Mr. Nichols may elect part-time employment
at a
18
reduced level of compensation with current
benefits remaining unchanged. We may not terminate Mr. Nichols employment
other than for cause.
Other than Mr.
Nichols, we have not entered into an employment agreement with any executive.
Tax Deductibility
of Compensation
In its deliberations, the
Committee considers ways to maximize deductibility of executive compensation,
but nonetheless retains the discretion to compensate executive officers at
levels the Committee considers commensurate with their responsibilities and
achievements. We have not adopted a policy that all executive compensation be
fully deductible.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE
COMPENSATION
.
We, the Compensation Committee of
the Board of Directors of Courier Corporation, have reviewed and discussed the
Compensation Discussion and Analysis contained in this proxy statement with
management. Based on such review and discussion, we have recommended to the
Board of Directors that the Compensation Discussion and Analysis be included in
this proxy statement for the fiscal year ended September 29, 2007.
Compensation
Committee of the Board of Directors
Kathleen Foley
Curley
|
|
Peter K. Markell
|
Richard K.
Donahue
|
|
Ronald L. Skates
|
Edward J. Hoff
|
|
W. Nicholas Thorndike
|
Arnold S. Lerner
|
|
Susan L. Wagner
|
Summary
Compensation Table
The following narrative,
table, and footnotes describe the total compensation earned during fiscal
2007 by our Named Executive Officers (executives).
The table discloses
compensation information for the Chief Executive Officer, those who served as
Chief Financial Officer during fiscal 2007, and the three highest paid other
executives as follows: Chief Executive Officer, James F. Conway, III; the Chief
Operating Officer, Robert P. Story, Jr., who also served as Chief Financial
Officer of the Corporation until his promotion to his current position in
November 2006; the Chief Financial Officer, Peter M. Folger, who was promoted
to this position in November 2006; George Q. Nichols, Chairman of National
Publishing Company; Eric J. Zimmerman, Vice President, Publishing; and Peter
Tobin, Executive Vice President, National Publishing Company.
The table discloses the
salary of each executive. Salary is base salary paid during the fiscal year
before salary reduction contributions to health insurance plans and to the
Courier Profit Sharing and Savings Plan.
The amounts reported under
the heading, Bonus, reflect discretionary, non-performance-based awards
granted to Mr. Nichols and Mr. Folger, as described in the Compensation
Discussion and Analysis section above.
19
The amounts reported under
the heading, Stock Awards, reflect the dollar amount recognized for financial
statement reporting purposes for the fiscal year ending September 29, 2007, in
accordance with Statement of Financial Accounting Standards No. 123R (SFAS
123R), for awards of restricted stock grants subject to time-based vesting,
which were granted in prior fiscal years and in fiscal 2007. The amounts
reported under the heading, Option Awards, reflects the dollar amount
recognized for financial statement reporting purposes for the fiscal year
ending September 29, 2007, in accordance with SFAS 123R, for awards of stock
options subject to time-based vesting, which were granted in prior fiscal years
and in fiscal 2007. Grants of restricted stock and stock options are explained
in detail in the Compensation Discussion and Analysis section above.
Amounts listed as Non
Equity Incentive Plan Compensation were earned in fiscal 2007 under the annual
cash bonus for fiscal 2007 and the 2005 LTPI for the three-year performance
period ended September 29, 2007, as described more fully in the Compensation
Discussion and Analysis section above. These amounts were approved for payment
by the Compensation Committee on November 7, 2007, and paid shortly thereafter.
We have omitted the column with the heading, Change in Pension Value and Non
Qualified Deferred Compensation Earnings, as we do not consider the interest
credited under the Deferred Compensation Plan as above market. While we do
provide a supplemental pension benefit for Mr. Nichols, that benefit has been
fully accrued as Mr. Nichols is age 78.
Amounts listed under the
heading, All Other Compensation, show the combined value of the executives
perquisites, such as automobile allowance, payment of country club dues, club
membership dues, and financial planning; tax assistance on amounts taxable as
compensation as a result of vesting of restricted stock grant awards, payment
of country club dues, and other tax reimbursements on imputed income; company
contributions to the Courier Profit Sharing and Savings Plan and the Deferred
Compensation Plan; and group-term life insurance premiums.
Summary Compensation Table
2007
|
|
|
|
|
|
|
|
|
|
|
|
Non-Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Incentive
|
|
All
|
|
|
|
|
|
|
|
|
|
|
|
Stock
|
|
Option
|
|
Plan
|
|
Other
|
|
|
|
Name and
|
|
|
|
Salary
|
|
Bonus
|
|
Awards
|
|
Awards
|
|
Compensation
|
|
Compensation
|
|
Total
|
|
Principal Position
|
|
Year
|
|
($)
|
|
($)
|
|
($)(1)
|
|
($)(2)
|
|
($)(3)
|
|
($)(4)
|
|
($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
James F. Conway III
|
|
2007
|
|
499,202
|
|
0
|
|
85,666
|
|
46,014
|
|
135,000
|
|
134,942
|
|
900,824
|
|
Chairman, President and
Chief Executive Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Robert P. Story, Jr.
|
|
2007
|
|
399,011
|
|
0
|
|
65,139
|
|
40,184
|
|
120,000
|
|
95,936
|
|
720,270
|
|
Executive Vice President
and Chief Operating Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Peter M. Folger
|
|
2007
|
|
249,038
|
|
20,000
|
|
24,392
|
|
9,077
|
|
25,000
|
|
40,852
|
|
368,359
|
|
Senior Vice President and
Chief Financial Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
George Q. Nichols
|
|
2007
|
|
389,523
|
|
30,000
|
|
0
|
|
|
|
0
|
|
98,428
|
|
517,951
|
|
Senior Vice President; and
Chairman of National Publishing Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eric J. Zimmerman
|
|
2007
|
|
199,620
|
|
0
|
|
21,735
|
|
16,490
|
|
0
|
|
43,952
|
|
281,797
|
|
Vice President, Publishing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Peter A. Tobin
|
|
2007
|
|
159,566
|
|
0
|
|
17,719
|
|
13,410
|
|
69,000
|
|
38,996
|
|
298,691
|
|
Executive Vice President,
National Publishing Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20
(1)
The amounts reflect the
dollar amount recognized for financial statement reporting purposes for the
fiscal year ended September 29, 2007, in accordance with SFAS 123R but
disregarding the estimate of forfeitures related to service-based vesting
conditions of awards of restricted stock which were granted in and prior to
2007. Refer to note F to our Consolidated Financial Statements included in our
Annual Report on Form 10-K for the year ended September 29, 2007, for a
discussion of the relevant assumptions used in calculating the compensation
expense.
(2)
The amounts reflect the
dollar amount recognized for financial statement reporting purposes for the
fiscal year ended September 29, 2007, in accordance with SFAS 123R but
disregarding the estimate of forfeitures related to service-based vesting
conditions of awards of stock options which were granted in and prior to 2007. Refer
to note F to our Consolidated Financial Statements included in our Annual
Report on Form 10-K for the year ended September 29, 2007, for a discussion of
the relevant assumptions used in calculating the compensation expense.
(3)
Awards of Non Equity
Incentive Plan Compensation were earned under the annual cash bonus for 2007
and the fiscal 2005 LTPI as provided in the following chart:
|
|
J. F. Conway III
|
|
R. P. Story
|
|
P. M. Folger
|
|
G. Q. Nichols
|
|
E. J. Zimmerman
|
|
P. Tobin
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2007 Annual Cash Bonus
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
25,000
|
|
2005 Long-Term Incentive Plan
|
|
$
|
135,000
|
|
$
|
120,000
|
|
$
|
25,000
|
|
$
|
0
|
|
$
|
0
|
|
$
|
44,000
|
|
(4)
The table below presents an
itemized account of All Other Compensation paid in 2007 to or on behalf of
the executives in accordance with the Commissions rules and regulations.
All Other Compensation
|
|
J. F. Conway III
|
|
R. P. Story
|
|
P. Folger
|
|
G. Q. Nichols
|
|
E. Zimmerman
|
|
P. Tobin
|
|
Perquisites(a)
|
|
$
|
28,314
|
|
$
|
13,857
|
|
$
|
13,857
|
|
$
|
27,566
|
|
$
|
13,512
|
|
$
|
13,857
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax assistance(b)
|
|
$
|
30,439
|
|
$
|
20,779
|
|
$
|
6,133
|
|
$
|
4,163
|
|
$
|
10,215
|
|
$
|
7,192
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company contributions(c)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
profit sharing contribution to Courier PSSP
|
|
$
|
15,400
|
|
$
|
15,400
|
|
$
|
15,400
|
|
$
|
18,700
|
|
$
|
15,400
|
|
$
|
14,300
|
|
401k matching contribution
|
|
$
|
5,723
|
|
$
|
5,155
|
|
$
|
4,714
|
|
$
|
5,036
|
|
$
|
4,209
|
|
$
|
3,138
|
|
Deferred Compensation Plan
|
|
$
|
53,570
|
|
$
|
39,525
|
|
$
|
0
|
|
$
|
41,741
|
|
$
|
0
|
|
$
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Life insurance premiums(d)
|
|
$
|
1,496
|
|
$
|
1,221
|
|
$
|
748
|
|
$
|
1,223
|
|
$
|
616
|
|
$
|
509
|
|
(a)
Amounts listed are the value of executives
perquisites: automobile allowance, payment of country club dues and club
memberships, and payment of financial planning services. Amount does not
include any amounts for the following perquisite because no incremental costs
were incurred in fiscal 2007: The Corporation purchases season tickets for
sporting events for business outings with customers and vendors. If the tickets
are not being used for business purposes, the named executives and other
employees may have opportunities to use these tickets.
21
(b)
Amounts listed represent the tax assistance paid
upon the vesting of the restricted stock award, equal to 30 percent of the amount
that is taxable as income to the executive for the fiscal year, tax assistance
paid on country club dues; and tax reimbursement on imputed income on
company-sponsored sales event in which the executive and spouse (if applicable)
attended.
(c)
Represents amount paid to the profit sharing and
401k matching contribution accounts in the Courier Profit Sharing and Savings
Plan and contributions made to the Deferred Compensation Plan in fiscal 2007.
(d)
Company cost of group-term life insurance premiums.
Grant of
Plan-based Awards
During fiscal 2007, the
Compensation Committee granted the following plan-based awards:
1. An annual cash bonus, subject to minimum earnings performance
thresholds for fiscal 2007.
2. The 2007 LTPI, to be earned
at the end of a three-year performance period (fiscal 2007, 2008, and 2009),
subject to the Corporation exceeding its peer groups three-year average ROA. Since
a three-year long-term performance incentive is normally granted each year,
there are three overlapping long-term performance incentive awards outstanding
at any time.
3. Special awards of restricted stock to Messrs. Conway, Story, and
Folger.
4. Restricted stock grant and
stock option awards under the LTSI as part of executives fiscal 2008
compensation.
Information with respect to
each of these awards on a grant-by-grant basis is set forth in the Grant of
Plan-based Awards Table below and is explained more fully in the Compensation
Discussion and Analysis section above.
The Compensation Committee
granted restricted stock grants and stock option awards as part of the
executives fiscal 2008 compensation at the Committees last meeting in fiscal
2007. The restricted stock grants awarded to executives in fiscal 2007 vest in
full three years following the date of the grant. Stock option awards vest in
equal amounts annually over a three-year period. The restricted stock grant
awarded to Mr. Conway in November 2006 was awarded as special recognition of
our strong fiscal 2006 performance. The restricted stock grants awarded to Mr.
Story and Mr. Folger were in recognition of the promotions to the current roles
each of them assumed in November 2006.
22
Grants of Plan-Based Awards
2007
|
|
|
|
|
|
|
|
|
|
Stock
|
|
All
Other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Awards:
|
|
Option
|
|
|
|
|
|
|
|
|
|
Estimated
Future Payouts
|
|
Number
|
|
Awards:
|
|
Exercise
|
|
|
|
|
|
|
|
Under
Non-Equity
|
|
of
|
|
Number
of
|
|
or Base
|
|
Grant
Date
|
|
|
|
|
|
Incentive
Plan Awards(1)
|
|
Shares
|
|
Securities
|
|
Price of
|
|
Fair
Value
|
|
|
|
|
|
|
|
|
|
|
|
of Stock
|
|
Underlying
|
|
Option
|
|
of Stock
and
|
|
|
|
Grant
|
|
Threshold
|
|
Target
|
|
Maximum
|
|
or Units
|
|
Options
|
|
Awards
|
|
Option
|
|
Name
|
|
Date
|
|
($)
|
|
($)
|
|
($)
|
|
(#)(2)
|
|
(#)(3)
|
|
($/Sh)(4)
|
|
Awards(5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
James F. Conway
III
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annual
Cash Bonus
|
|
|
|
95,000
|
|
380,000
|
|
760,000
|
|
|
|
|
|
|
|
|
|
LTPI
|
|
|
|
|
|
145,000
|
|
|
|
|
|
|
|
|
|
|
|
Stock
Incentive Plan
|
|
11/7/2006
|
|
|
|
|
|
|
|
2,000
|
|
|
|
|
|
76,600
|
|
Stock
Incentive Plan
|
|
9/18/2007
|
|
|
|
|
|
|
|
|
|
9,925
|
|
36.51
|
|
87,415
|
|
Stock
Incentive Plan
|
|
9/18/2007
|
|
|
|
|
|
|
|
1,825
|
|
|
|
|
|
66,631
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Robert P. Story,
Jr.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annual
Cash Bonus
|
|
|
|
77,500
|
|
310,000
|
|
620,000
|
|
|
|
|
|
|
|
|
|
LTPI
|
|
|
|
|
|
130,000
|
|
|
|
|
|
|
|
|
|
|
|
Stock
Incentive Plan
|
|
11/7/2006
|
|
|
|
|
|
|
|
1,000
|
|
|
|
|
|
38,300
|
|
Stock
Incentive Plan
|
|
9/18/2007
|
|
|
|
|
|
|
|
|
|
8,675
|
|
36.51
|
|
76,406
|
|
Stock
Incentive Plan
|
|
9/18/2007
|
|
|
|
|
|
|
|
1,600
|
|
|
|
|
|
58,416
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Peter Folger
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annual
Cash Bonus
|
|
|
|
31,250
|
|
125,000
|
|
250,000
|
|
|
|
|
|
|
|
|
|
LTPI
|
|
|
|
|
|
29,000
|
|
|
|
|
|
|
|
|
|
|
|
Stock
Incentive Plan
|
|
11/7/2006
|
|
|
|
|
|
|
|
1,000
|
|
|
|
|
|
38,300
|
|
Stock
Incentive Plan
|
|
9/18/2007
|
|
|
|
|
|
|
|
|
|
4,520
|
|
36.51
|
|
39,810
|
|
Stock
Incentive Plan
|
|
9/18/2007
|
|
|
|
|
|
|
|
830
|
|
|
|
|
|
30,303
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
George Q. Nichols
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annual
Cash Bonus
|
|
|
|
83,750
|
|
335,000
|
|
670,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eric Zimmerman
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annual
Cash Bonus
|
|
|
|
28,750
|
|
115,000
|
|
230,000
|
|
|
|
|
|
|
|
|
|
Stock
Incentive Plan
|
|
9/18/2007
|
|
|
|
|
|
|
|
|
|
3,535
|
|
36.51
|
|
31,135
|
|
Stock
Incentive Plan
|
|
9/18/2007
|
|
|
|
|
|
|
|
650
|
|
|
|
|
|
23,732
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Peter D. Tobin
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annual
Cash Bonus
|
|
|
|
12,500
|
|
50,000
|
|
100,000
|
|
|
|
|
|
|
|
|
|
(1) The
amounts shown for the Annual Cash Bonus are the range of payouts that may be
earned. If the minimum earnings threshold is met, the payout amount is 25% of
the target bonus, as shown in the Threshold column above. If the minimum
earnings threshold is not met, the payout amount is $0. The amount in the Maximum
column reflects the maximum payout under the annual cash bonus program, which
is 200 percent of the amount shown in the Target column. The target amount
for the LTPI may be earned at the end of the three-year performance period of
fiscal 2007, 2008, and 2009, as described in the Compensation Discussion and
Analysis section above. These amounts were approved by the Committee on
November 7, 2006.
(2) Amounts
shown in All Other Stock Awards column reflect shares of restricted stock
granted in fiscal 2007. Awards vest in full three years following the date of
grant. Dividends are paid on shares of restricted stock, when and if declared,
at the same rate as paid to all shareholders.
(3) The
amounts shown in the All Other Option Awards column reflect stock options
granted in fiscal 2007, which are for a term of five years and vest in equal
amounts annually over a three-year period.
23
(4) The
stock option exercise price is the closing price of our Common Stock on the
date of grant.
(5) The
grant date fair value for awards is calculated as follows: (a) for restricted
stock, by multiplying the number of shares granted by the closing price of our
Common Stock on the date of the award; and (b) for option awards, by using the
Black-Scholes option pricing model, as described in Note F of the Corporations
audited financial statements for fiscal 2007 included in the Corporations
Annual Report. This value does not reflect estimated forfeitures or awards
actually forfeited during the year or tax assistance on grants when they vest. The
actual value, if any, that will be realized upon the exercise of an option will
depend upon the difference between the exercise price of the option and the
market price of our Common Stock on the date the option is exercised. The
actual value realized by the executive with respect to a grant of restricted
stock depends on the market value of the shares when the executive sells the
shares after the shares have vested.
Outstanding Equity Awards at
Fiscal Year-End
2007
The
following table sets forth information concerning stock options and stock
awards which were outstanding as of September 29, 2007:
|
|
Option
Awards
|
|
|
|
Stock
Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number
of
|
|
|
|
|
|
|
|
Number
of
|
|
Number
of
|
|
|
|
|
|
|
|
Shares
or
|
|
|
|
Market
Value
|
|
|
|
Securities
|
|
Securities
|
|
|
|
|
|
|
|
Units of
|
|
|
|
of
Shares or
|
|
|
|
Underlying
|
|
Underlying
|
|
Option
|
|
|
|
|
|
Stock
That
|
|
|
|
Units of
Stock
|
|
|
|
Unexercised
|
|
Unexercised
|
|
Exercise
|
|
Option
|
|
|
|
Have Not
|
|
|
|
That
Have Not
|
|
|
|
Options
(#)
|
|
Options
(#)
|
|
Price
|
|
Expiration
|
|
|
|
Vested
|
|
|
|
Vested
|
|
Name
|
|
Exercisable
|
|
Unexercisable
|
|
($)
|
|
Date
|
|
|
|
(#)
|
|
|
|
($)(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
James F. Conway
III
|
|
6,748
|
|
|
|
25.60
|
|
9/25/2008
|
|
|
|
1,679
|
|
(4)
|
|
59,118
|
|
|
|
16,087
|
|
|
|
16.91
|
|
9/26/2009
|
|
|
|
1,672
|
|
(5)
|
|
58,871
|
|
|
|
17,550
|
|
|
|
23.27
|
|
9/25/2010
|
|
|
|
2,000
|
|
(6)
|
|
70,420
|
|
|
|
7,759
|
|
|
|
27.17
|
|
9/23/2011
|
|
|
|
1,825
|
|
(7)
|
|
64,258
|
|
|
|
2,363
|
|
4,726
|
|
37.09
|
|
9/25/2011
|
|
(2)
|
|
|
|
|
|
|
|
|
|
3,751
|
|
1,876
|
|
35.51
|
|
9/22/2012
|
|
(3)
|
|
|
|
|
|
|
|
|
|
|
|
9,925
|
|
36.51
|
|
9/18/2012
|
|
(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Robert P. Story,
Jr.
|
|
4,510
|
|
|
|
9.59
|
|
9/26/2008
|
|
|
|
1,462
|
|
(4)
|
|
51,477
|
|
|
|
2,250
|
|
|
|
13.75
|
|
11/8/2008
|
|
|
|
1,463
|
|
(5)
|
|
51,512
|
|
|
|
16,762
|
|
|
|
16.91
|
|
9/26/2009
|
|
|
|
1,000
|
|
(6)
|
|
35,210
|
|
|
|
20,699
|
|
|
|
23.27
|
|
9/25/2010
|
|
|
|
1,600
|
|
(7)
|
|
56,336
|
|
|
|
6,726
|
|
|
|
27.17
|
|
9/23/2011
|
|
|
|
|
|
|
|
|
|
|
|
2,068
|
|
4,135
|
|
37.09
|
|
9/25/2011
|
|
(2)
|
|
|
|
|
|
|
|
|
|
3,267
|
|
1,634
|
|
35.51
|
|
9/22/2012
|
|
(3)
|
|
|
|
|
|
|
|
|
|
|
|
8,675
|
|
36.51
|
|
9/18/2012
|
|
(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Peter M. Folger
|
|
5,062
|
|
|
|
16.91
|
|
9/26/2009
|
|
|
|
325
|
|
(4)
|
|
11,443
|
|
|
|
5,062
|
|
|
|
23.27
|
|
9/25/2010
|
|
|
|
334
|
|
(5)
|
|
11,760
|
|
|
|
1,449
|
|
|
|
27.17
|
|
9/23/2011
|
|
|
|
1,000
|
|
(6)
|
|
35,210
|
|
|
|
473
|
|
945
|
|
37.09
|
|
9/25/2011
|
|
(2)
|
|
830
|
|
(7)
|
|
29,224
|
|
|
|
726
|
|
363
|
|
35.51
|
|
9/22/2012
|
|
(3)
|
|
|
|
|
|
|
|
|
|
|
|
4,520
|
|
36.51
|
|
9/18/2012
|
|
(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eric J. Zimmerman
|
|
842
|
|
1,683
|
|
37.09
|
|
9/25/2011
|
|
(2)
|
|
607
|
|
(4)
|
|
21,372
|
|
|
|
677
|
|
678
|
|
35.51
|
|
9/22/2012
|
|
(3)
|
|
596
|
|
(5)
|
|
20,985
|
|
|
|
|
|
3,535
|
|
36.51
|
|
9/18/2012
|
|
(2)
|
|
650
|
|
(7)
|
|
22,887
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Peter Tobin
|
|
5,062
|
|
|
|
9.59
|
|
9/26/2008
|
|
|
|
498
|
|
(4)
|
|
17,535
|
|
|
|
6,750
|
|
|
|
16.91
|
|
9/26/2009
|
|
|
|
481
|
|
(5)
|
|
16,936
|
|
|
|
6,749
|
|
|
|
23.27
|
|
9/25/2010
|
|
|
|
|
|
|
|
|
|
|
|
2,328
|
|
|
|
27.17
|
|
9/23/2011
|
|
|
|
|
|
|
|
|
|
|
|
680
|
|
1,358
|
|
37.09
|
|
9/25/2011
|
|
(2)
|
|
|
|
|
|
|
|
|
|
1,113
|
|
557
|
|
35.51
|
|
9/22/2012
|
|
(3)
|
|
|
|
|
|
|
|
24
(1) The
market value is the closing price per share of our Common Stock of $35.21 per
share on September 28, 2007, multiplied by the number of unvested shares of
Common Stock.
(2)
Stock option award has a five-year term and vests in equal installments on the
anniversary date of grant over a three-year period.
(3)
Stock option award has a seven-year term and vests in equal installments on the
anniversary date of grant over a three-year period.
(4) Award
vests on 9/22/2008.
(5) Award
vests on 9/25/2009.
(6) Award
vests on 11/7/2009.
(7) Award
vests on 9/18/2010.
Option Exercises and Stock
Vested 2007
The
following table sets forth information concerning stock option exercises and
vesting of restricted stock during fiscal 2007:
|
|
Option Awards
|
|
Stock Awards
|
|
|
|
Number of
|
|
|
|
Number of
|
|
|
|
|
|
Shares Acquired
|
|
Value Realized
|
|
Shares Acquired
|
|
Value Realized
|
|
Name
|
|
on Exercise (#)
|
|
on Exercise ($)(1)
|
|
on Vesting (#)
|
|
on Vesting ($)(2)
|
|
|
|
|
|
|
|
|
|
|
|
James F. Conway III
|
|
7,875
|
|
173,288
|
|
2,163
|
|
79,901
|
|
|
|
|
|
|
|
|
|
|
|
Robert P. Story, Jr.
|
|
2,628
|
|
88,091
|
|
1,875
|
|
69,263
|
|
|
|
|
|
|
|
|
|
|
|
Peter M. Folger
|
|
0
|
|
0
|
|
403
|
|
14,887
|
|
|
|
|
|
|
|
|
|
|
|
Eric J. Zimmerman
|
|
13,647
|
|
238,794
|
|
793
|
|
29,293
|
|
|
|
|
|
|
|
|
|
|
|
Peter D. Tobin
|
|
5,062
|
|
160,820
|
|
649
|
|
23,974
|
|
(1)
Represents the
amounts realized based on the difference between the market price of our Common
Stock on the date of exercise and the exercise price.
(2)
Represents the
amount realized based on the market price of our Common Stock on the vesting
date. These restricted stock awards were granted in fiscal 2004 and vested in
fiscal 2007.
Nonqualified
Deferred Compensation
In November 1997, we
established the Courier Corporation Deferred Compensation Program for certain
key executives. The current eligible participants in the plan are Messrs.
Conway, Story, and Nichols. The plan is a non-qualified, unfunded plan that
provides for an annual award. The annual award is the difference between what
the company annual profit sharing contribution would have been if not limited
to the IRS-mandated compensation maximum and the actual profit sharing
contribution made to the
25
participants account in the Courier Profit
Sharing and Savings Plan for the plan year (which is a calendar year). The
participants make no contributions to the plan.
Amounts are accrued and
recorded in each participants Deferred Compensation Account. Interest is
credited annually based on the investment return of one of four mutual funds
within the Courier Profit Sharing and Savings Plan that the participant elects
prior to the beginning of the plan year. We do not consider the interest
credited to be above-market as the fund choices are available to all
participants in the Savings Plan. All of the participants are fully vested in
the amounts credited to their Deferred Compensation Account. Participants are
eligible for a distribution of their accrued account upon retirement,
termination of employment, disability, or to their beneficiary upon death.
The following table provides
information with respect to the Deferred Compensation Accounts of the eligible
executives:
Nonqualified Deferred
Compensation 2007
|
|
Executive
|
|
Registrant
|
|
Aggregate
|
|
Aggregate
|
|
Aggregate
|
|
|
|
Contributions in
|
|
Contributions in
|
|
Earnings in Last
|
|
Withdrawals/
|
|
Balance at Last
|
|
|
|
Last Fiscal Year
|
|
Last Fiscal Year
|
|
Fiscal Year
|
|
Distributions
|
|
Fiscal Year End
|
|
Name
|
|
($)
|
|
($)(1)
|
|
($)
|
|
($)
|
|
($)(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
J. F. Conway III
|
|
0
|
|
53,570
|
|
39,563
|
|
0
|
|
458,778
|
|
R. P. Story, Jr.
|
|
0
|
|
39,525
|
|
34,828
|
|
0
|
|
396,242
|
|
G. Q. Nichols
|
|
0
|
|
41,741
|
|
23,900
|
|
0
|
|
516,591
|
|
(1)
Amounts in this column are included in the All
Other Compensation column in the Summary Compensation Table.
(2)
Represents the sum of all contributions and earnings
credited to the participants Deferred Compensation Account as of the end of
fiscal 2007.
Pension
Benefits
In June 1992, the Board of
Directors approved a Supplemental Retirement Benefit Agreement with Mr. Nichols
providing for a supplement retirement benefit upon his retirement at or over
age 70. On November 9, 2000, the Board of Directors voted to increase the
annual amount of the benefit to $70,000 upon retirement at or over age 70. Mr.
Nichols is currently age 78, and is still employed by the Corporation.
The Supplemental Retirement
Benefit Agreement provides that the benefit would be payable as a single life
annuity, payable in monthly installments commencing the first of the calendar
month following his retirement. Before his retirement, Mr. Nichols may elect to
have the benefit paid in an amount actuarially equivalent to the single life
annuity and in the same form as the benefit he elects for his pension annuity. Mr.
Nichols pension annuity is the benefit he earned through his participation in
the National Publishing Company pension plan, which was terminated in 1988. He
has elected to receive his pension annuity as a 50 percent joint and survivor
annuity.
In the event that Mr.
Nichols dies before he retires and is survived by his spouse, a monthly benefit
will be paid to his spouse for her life in an amount equal to the benefit she
would have received upon Mr. Nichols death had he retired on the day preceding
his death. If Mr. Nichols has not selected an alternative form of annuity
before his death, the spousal benefit will be determined as if he had selected
a joint and 100 percent survivor
26
annuity. In the event we undergo a change in
control (as defined in the Supplemental Retirement Benefit Agreement) during
Mr. Nichols employment or the payment period of the benefit, the commuted
value of the benefit will be paid to Mr. Nichols within 60 days after the change
in control. The commuted value of the benefit is the present value of the
benefit remaining to be paid at the time of the change in control, assuming
that Mr. and Mrs. Nichols will survive for a period equal to their joint and
last survivor life expectancies, and applying a rate of interest equal to the
Internal Revenue Service applicable federal rate for that period.
Pension Benefits 2007
|
|
|
|
Number of
|
|
|
|
|
|
|
|
|
|
Years of
|
|
Present Value of
|
|
Payments
|
|
|
|
|
|
Credited
|
|
Accumulated
|
|
During Last
|
|
|
|
|
|
Service
|
|
Benefits
|
|
Fiscal Year
|
|
Name
|
|
Plan Name
|
|
(#)
|
|
($)
|
|
($)
|
|
|
|
|
|
|
|
|
|
|
|
George Q. Nichols
|
|
Supplemental Retirement
Benefit Agreement
|
|
n/a
|
|
507,971
|
|
0
|
|
Potential
Payments Upon Termination or Change in Control
This section
describes particular benefits that may become payable to executives, depending
on the circumstances surrounding their termination of employment following a
change in control of the Corporation. As described earlier, our Board of
Directors approved the Severance Program which sets forth the severance
compensation which we will pay to an executive in the event that executives
employment with us terminates under certain circumstances following a change in
control. The Compensation Committee established provisions for determining what
amounts under the Executive Compensation Program would become payable to an
executive upon a change in control. In addition, account balances provided in
the Courier Corporation Deferred Compensation Program are immediately payable
upon a change in control.
In calculating the amount of
any potential payments to executive officers under the arrangements described
below, we have assumed that the applicable triggering event (i.e., termination
of employment) occurred on the last day of the fiscal year, September 29, 2007,
and that the price per share of our Common Stock is equal to $35.21, which is
the closing price on September 28, 2007, the last trading day in fiscal 2007.
Senior Executive
Severance Program
Messrs. Conway, Nichols,
Story, Folger, Zimmerman, and Tobin are participants in the Severance Program. In
accordance with the Severance Program, if we undergo a change in control, as
defined in the Severance Program, while one of these individuals remains an
employee, and his employment is subsequently terminated for reasons other than
death, disability, or termination for cause, he shall be entitled to a
severance payment and continuation of participation in our group health plan
until the end of the second calendar year following the year of termination. In
addition, each such individual shall receive a severance payment and benefits
if within two years of the change in control, he terminates his employment for good
reason, defined in the Severance Program to include changes in his duties or
titles inconsistent with his duties or titles prior to the change in control,
reduction in his base salary or failure to increase his base salary by at least
the average percentage increase for all corporate officers, reduction or
termination of incentive or benefit plans or programs in which he participated
prior to the change in control, or relocation of our principal offices. Termination
by the individual for any reason during a
27
30-day window commencing on the first
anniversary of the change in control is also considered good reason for
purposes of the Severance Program.
The severance
payment, which is due in a lump sum, is an amount equal to a multiple of 3.0
times the individuals average annual salary and bonus paid or deferred during
the five calendar years preceding the change in control, except in the case of
Mr. Zimmerman and Mr. Tobin, the multiple is 2.0. Payment of the severance may
be delayed up to six months after termination of employment to the extent
necessary to comply with the requirement of Section 409A of the Internal
Revenue Code and may also be reduced if the aggregate payment of amounts under
the Severance Program and the Executive Compensation Program discussed below
would trigger the payment of excise taxes under the Internal Revenue Code and
the individual would be better off on an after-tax basis with such reduction. At
the sole discretion of the Board of Directors, we may choose to set aside funds
in a trust to satisfy its severance obligations.
Executive
Compensation Program
Under the Executive Compensation Program (the Program),
upon a change in control as defined in the Program, executives are entitled
to receive a pro rata portion of the annual cash bonus target and target long
term performance incentive awarded under the Program. Cash awards will be pro
rated based on the number of elapsed days in the performance period from the
start of the period through the date of the closing of the change in control
transaction divided by the total days in the performance period.
Long-term stock incentive
awards under the Program consist of a combination of stock options and
restricted stock grants. Upon a change in control, outstanding restricted stock
grants vest and related tax assistance payments will be made. In addition,
outstanding stock options become fully exercisable.
Courier
Corporation Deferred Compensation Program
As
described earlier, Messrs. Conway, Nichols, and Story participate in the
Deferred Compensation Program, which is a non-qualified, unfunded plan that
provides for an annual award. Upon a change in control of the Corporation as
defined in the Deferred Compensation program, the executive has the right to
receive a distribution of his account value as of the December 31 preceding the
change in control, adjusted for earnings or losses based on the total
investment return of the executives investment choice from January 1 through
the date of the change in control. Account balances as of our most recent
fiscal year end are listed in the Nonqualified Deferred Compensation Table.
28
Potential Payments Upon Termination or Change in
Control Table
Amounts assume a Change in
Control and simultaneous termination of employment of each listed executive as
of September 29, 2007.
|
|
Executive Severance Program
|
|
Executive Compensation Program
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
|
|
Stock
|
|
|
|
Name
|
|
Cash Award(1)
|
|
Benefits(2)
|
|
Cash(3)
|
|
LTIP(4)
|
|
Options(5)
|
|
Grants(6)
|
|
Total(7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
James F. Conway III
|
|
$
|
2,523,564
|
|
$
|
33,652
|
|
$
|
135,000
|
|
$
|
141,667
|
|
$
|
0
|
|
$
|
188,409
|
|
$
|
3,022,291
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Robert P. Story, Jr.
|
|
$
|
2,028,296
|
|
$
|
33,652
|
|
$
|
120,000
|
|
$
|
126,667
|
|
$
|
0
|
|
$
|
138,199
|
|
$
|
2,446,814
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Peter M. Folger
|
|
$
|
834,020
|
|
$
|
33,652
|
|
$
|
25,000
|
|
$
|
27,000
|
|
$
|
0
|
|
$
|
58,413
|
|
$
|
978,086
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
George Q. Nichols
|
|
$
|
2,006,254
|
|
$
|
49,619
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
2,055,873
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eric Zimmerman
|
|
$
|
445,528
|
|
$
|
33,652
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
42,358
|
|
$
|
521,538
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Peter Tobin
|
|
$
|
769,115
|
|
$
|
33,652
|
|
$
|
69,000
|
|
$
|
30,000
|
|
$
|
0
|
|
$
|
34,471
|
|
$
|
936,237
|
|
(1)
Cash
payments under the Senior Executive Severance Program are equal to three times
the individuals average annual salary and cash incentives paid during the five
calendar years preceding the change in control for Messrs. Conway, Story,
Folger, and Nichols. In the case of Mr. Zimmerman and Mr. Tobin, the cash
amount is equal to two times the average annual salary and cash incentives paid
during the five calendar years preceding the change in control.
(2)
Value
of current medical insurance coverage with estimated annual 10 percent premium
increases; coverage for 27 months.
(3)
Non-equity
incentive compensation earned for fiscal 2007. See Summary Compensation Table
for explanation of amounts.
(4)
Pro
rata amounts through the date of the change in control transaction under the
fiscal 2006 and 2007 LTPI plans.
(5)
The
closing price of our Common Stock on September 28, 2007 (the last trading day
of fiscal 2007) is less than the exercise price of the outstanding unvested
options; therefore, the amount reported is $0.
(6)
Amounts
listed are the value of restricted stock grants, based on the closing price of
our Common Stock on September 28, 2007, that become vested upon a change in
control.
(7)
The
actual amounts payable to an executive upon termination due to a change in
control would be reduced if the aggregate payment of amounts under the
Severance Program and the Executive Compensation Program would trigger the
payment of excise taxes under the Internal Revenue Code, and the executive
would be better off on an after-tax basis with such reduction.
SECTION
16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based
on a review of the reports of changes in beneficial ownership of the
Corporations Common Stock and written representations furnished to the
Corporation, the Corporation believes that its executive officers, Directors
and beneficial owners of more
29
than ten percent of the
Corporations Common Stock filed on a timely basis the reports required to be
filed under Section 16(a) of the Securities Exchange Act of 1934 during the
fiscal year ended September 29, 2007, except for Kathleen M. Leon who filed Form
3 on May 8, 2007 as a result of her appointment to Corporate Controller on
November 13, 2006 and to report a stock grant award on December 7, 2006.
COMPENSATION
COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation
Committee consists of Messrs. Donahue, Hoff, Lerner, Markell, Skates and
Thorndike and Ms. Wagner and Prof. Curley.
Mr. Conway is a Director of Enterprise Bancorp Inc. (Enterprise) in
Lowell, Massachusetts and a member of the Enterprise compensation
committee. Mr. Lerner is a Director and
Vice Chairman of the Board of Directors of Enterprise and a member of its
compensation committee. However, Mr.
Lerner is not employed as an executive officer of Enterprise and is independent
as defined in the applicable provisions of Rule 4200(a)(15) of the National
Association of Securities Dealers Marketplace Rules.
ITEM
2: RATIFICATION AND APPROVAL OF
SELECTION OF INDEPENDENT AUDITORS
The Audit
Committee has selected the firm of Deloitte & Touche LLP to be the
Corporations independent auditors for the fiscal year ending September 27,
2008. The firm became independent
auditors for the Corporation in 1996.
Although the
Corporation is not required to submit the ratification and approval of the
selection of its independent auditors to a vote of stockholders, the Board of
Directors and the Audit Committee believe it is sound policy and in the best
interests of the stockholders to do so.
In the event a majority of the votes cast are against the selection of
Deloitte & Touche LLP, the Audit Committee will consider the vote and the
reasons therefore in its future selection of independent auditors.
Representatives of Deloitte & Touche LLP will be
present at the meeting and will have an opportunity to make a statement if they
desire to do so. They will be available
to respond to appropriate questions.
The Board of Directors recommends
that the selection of Deloitte & Touche LLP as independent auditors for the
Corporation be ratified and approved, and therefore recommends a vote FOR this proposal.
FEES PAID TO DELOITTE & TOUCHE LLP
Audit Fees
Total aggregate
fees billed by Deloitte & Touche LLP for professional services in
connection with the audit and review of the Corporations Consolidated
Financial Statements, and consultation regarding financial accounting and
reporting standards were $592,500 and $645,000 in fiscal 2007 and 2006,
respectively.
30
Audit-Related Fees
The aggregate fees
billed for assurance and related services rendered by Deloitte & Touche LLP
were $9,500 and $0 in fiscal 2007 and 2006, respectively.
Tax Fees
The aggregate fees
billed for services rendered by Deloitte & Touche LLP tax personnel, except
those services specifically related to the audit of the financial statements,
were $17,500 and $17,000 in fiscal 2007 and 2006, respectively. Such services include tax planning, tax
return reviews, and tax compliance.
All Other Fees
Except as reported above,
no other fees were billed by Deloitte & Touche LLP in fiscal 2007 and 2006.
The Audit
Committee has advised the Corporation that in its opinion the non-audit
services rendered by Deloitte & Touche LLP are compatible with maintaining
the independence of the auditor.
In April 2003, the Audit Committee established a
policy to pre-approve all audit and non-audit services proposed to be provided
by our independent auditor prior to management engaging the auditor for that
purpose. Consideration and approval of
such services generally occur at the Committees regularly scheduled quarterly
meetings. In situations where it is
impractical to wait until the next regularly scheduled quarterly meeting, the
Committee may delegate, to one or more of its members, authority to approve
audit and non-audit services. Fees payable
to the independent auditor for any specific non-audit service approved pursuant
to the above-described delegation of authority requires the reporting of any
such approvals to the full Committee at its next regularly scheduled meeting.
In accordance with
its pre-approval policy, the Audit Committee has pre-approved all services in
fiscal 2007 and 2006.
MISCELLANEOUS
Stockholder Proposals
The Corporation
expects to hold its 2009 Annual Meeting on January 21, 2009. Eligible stockholders may present proposals
for inclusion in the Corporations 2009 Annual Meeting Proxy Statement,
provided the proposals comply with applicable Securities and Exchange
Commission regulations and are received by the Corporation no later than August
10, 2008. Any proposal intended to be
included in the Corporations 2009 Annual Proxy Statement should be sent to the
Corporation at 15 Wellman Avenue, North Chelmsford, Massachusetts 01863,
Attention: Peter M. Folger, Senior Vice
President and Chief Financial Officer.
Stockholders who
want to present business for action at the 2009 Annual Meeting, other than
proposals included in the 2009 Annual Proxy Statement, must follow the
procedures described in the Corporations By-laws. The By-laws provide that stockholder proposals
or nominations for director may be made only by a stockholder of
31
record who is entitled to vote at the meeting and has given the
Corporation advance notice of the proposed business or nomination. For the 2009 Annual Meeting, the Corporation
must receive the stockholders notice between September 18, 2008, and October
18, 2008. If there is a special meeting,
or if the 2009 Annual Meeting is called for a date prior to December 18, 2008
or after March 16, 2009, the Corporation must receive the stockholders notice
not earlier than the close of business on the 120
th
day prior to the
special meeting or the 2009 Annual Meeting, as the case may be, and not later
than the close of business on the later of (1) the 90
th
day prior to
the special meeting or the 2009 Annual Meeting, as the case may be, or (2) the
10
th
day following the day on which the public announcement of the
date of the special meeting or the 2009 Annual Meeting is first made. The proposal must also comply with the other
requirements contained in the Corporations By-laws, including supporting
documentation and other information. Proxies solicited by the Board of
Directors will confer discretionary voting authority with respect to these
proposals, subject to the Commissions rules governing the exercise of this
authority.
Householding
The rules of the Commission allow for householding,
which is the delivery of a single copy of an annual report and proxy statement
to any address shared by two or more stockholders. Duplicate mailings can be eliminated by
allowing stockholders to consent to such elimination, or through implied
consent if (1) it is believed that the stockholders are members of the
same family, (2) the stockholders are notified that householding is to be
used and (3) the stockholders do not request continuation of duplicate
mailings. If you own shares of Common
Stock in your own name as a holder of record, householding will not apply to
your shares. If your shares of Common
Stock are held in street name, depending upon the practices of your broker,
bank or other nominee, you may need to contact them directly to discontinue
duplicate mailings to your address. If
you wish to revoke your consent to householding, you must contact your broker,
bank or other nominee.
If you wish to request extra copies free of charge of
an annual report or proxy statement, please send your request to Courier
Corporation, 15 Wellman Avenue, North Chelmsford, Massachusetts 01863,
Attention: Secretary/Clerk; call us with your request at (978)
251-6136; or visit our website at www.courier.com.
32
Voting of Proxies
The persons named in the enclosed Proxy will vote as
directed in the Proxy and, in the absence of such direction, will vote in favor
of the actions specified in Items 1 and 2 of the Proxy. The shares will be voted on such other
matters as may properly come before the meeting in accordance with the best
judgement of the Proxy holder including voting for election of a Director in
place of any person named above who may not be available for election. The Board of Directors of the Corporation is
not aware of any other matters that may come before the meeting.
|
By order of the Board
of Directors,
|
|
|
|
F. BEIRNE LOVELY, JR.,
|
|
Secretary and Clerk
|
15 Wellman Avenue
North Chelmsford,
Massachusetts 01863
December 7, 2007
IF YOU DO NOT EXPECT TO ATTEND THE MEETING
IN PERSON, IT WOULD BE APPRECIATED IF YOU WOULD FILL IN AND SIGN THE ENCLOSED
PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE. YOU MAY ALSO VOTE YOUR SHARES THROUGH THE
INTERNET OR BY TELEPHONE.
33
Exhibit A
Corporate Governance
Guidelines
1.
Board Size
The Board considers that 8-12
directors is optimal. This approach is flexible depending on the circumstances
and the qualifications of proposed candidates.
2.
Number, Structure and Function of Committees
The number, structure and
function of Board Committees shall be reviewed periodically by the Nominating
and Corporate Governance Committee. The
Audit and Finance Committee, Compensation and Management Development Committee,
and the Nominating and Corporate Governance Committee shall each have a written
charter.
3.
Board Meetings
The frequency and length
of Board meetings shall be determined by the Chairman and Committee Chairs with
input from the directors. Meeting
schedules shall be approved by the full Board.
4.
Agenda Items
Agenda items shall be
determined by the Chairman and Committee Chairs with input from the directors.
5.
Presentations by Management
Members of management
shall report at each meeting on business and other topics of interest to the
Board.
6.
Executive Sessions
The independent directors
shall meet at regularly scheduled executive sessions without management in
accordance with applicable regulations promulgated by the SEC and/or
NASDAQ. The lead director shall preside
at the session. The lead director shall
be independent and shall be the Chairman if the Chairman is independent;
otherwise, the lead director shall be nominated by the Chairman and approved by
a majority of the independent directors.
7.
Reports by the Committees to the Board
The Committees regularly
shall report to the Board on their proceedings and deliberations. The
Committees also shall bring to the Board for consideration those matters and
decisions which the Committees judge to be of special significance.
8.
Director Qualifications, Responsibilities, Orientation and Continuing Education
Director qualifications shall be reviewed by the
Nominating and Corporate Governance Committee and subsequently by the Board in
connection with the nomination of candidates for election at the annual
meeting.
Couriers business shall be managed under the direction
of the Board of Directors. Directors shall be expected to invest the time and
effort necessary to understand the Corporations business and financial
strategies and challenges. The basic
duties and responsibilities of the directors shall include attending Board
meetings, preparing for meetings by advance review of any meeting materials and
actively participating in Board
34
discussions. Directors also shall be expected to make
themselves available outside of Board meetings for advice and consultation.
The Secretary/Clerk and
the General Counsel shall be responsible for providing orientation materials
to, and scheduling orientation sessions for, new directors. The Secretary/Clerk
and the General Counsel will also work with the Chairman and Committee Chairs
as necessary to periodically provide materials and other guidance that would
assist directors with their continuing education.
9.
Candidates; Limitation of Service on Other Public Company Boards
The Nominating and
Corporate Governance Committee shall identify and evaluate proposed candidates
for addition to the Board, including candidates proposed by third parties, in
accordance with its charter. The Nominating
and Corporate Governance Committee shall recommend candidates who should be
invited to join the Board and the Board shall authorize and extend invitations
to join the Board. Individuals shall be
selected to join the Board based on their business or professional experience,
the diversity of their background, their array of talents and perspectives and
the other criteria set forth in the charter of the Nominating and Corporate
Governance Committee.
The Nominating and
Corporate Governance Committee shall also make recommendations to the Board
with respect to whether or not existing directors should be nominated by the
Board for re-election by the shareholders at the annual meeting.
Directors may not serve
on more that 4 public company boards of directors (including the
Corporation). If a director is also an
active CEO of a public company, such director may not serve on more than 3
public company boards (including the Corporation). The CEO of the Corporation may not serve on
more than 3 other public company boards (including the Corporation).
10.
Director Independence
The Board shall be
composed of a majority of independent directors, and shall strive to maintain a
two-thirds majority of independent directors.
The Audit and Finance Committee, Compensation and Management Development
Committee, and Nominating and Corporate Governance Committee shall be composed
entirely of independent directors. The
Nominating and Corporate Governance Committee and the full Board shall annually
review the financial and other relationships between the non-management
directors and Courier. The Nominating and Corporate Governance Committee shall
make recommendations to the Board about the independence of non-management
directors. The Board shall determine
whether such directors are independent in accordance with applicable NASDAQ
National Market Issuer Requirements for independent directors and shall
determine that no relationships exist which, in the opinion of the Board, would
interfere with the exercise of independent judgment in carrying out the
responsibilities of a director.
11.
Change in Position
Upon a change in position
or responsibility in his or her principal occupation, each director will notify
the Nominating and Corporate Governance Committee and the Board. The Nominating and Corporate Governance Committee
shall recommend to the Board whether or not such directors resignation should
be requested as a result of such change.
If requested by the Board, such director shall tender his or her
resignation from the Board promptly.
35
12.
Retirement Age; Term Limits
Non-management directors
shall not stand for reelection at the first annual meeting at which they are
otherwise eligible for reelection following age 75, unless their reelection is
in the best interests of the shareholders, as recommended by the Nominating and
Corporate Governance Committee and determined by the Board. Those directors that are over 75 at the time
these Corporate Governance Guidelines are approved shall continue to remain
directors until the end of their current term, at which time they shall not
stand for reelection unless their reelection is in the best interests of the
shareholders, as recommended by the Nominating and Corporate Governance
Committee and determined by the Board.
The Board does not
believe that it should establish term limits for directors. While term limits could help insure that
there are fresh ideas and viewpoints available to the Board, they hold the
disadvantage of losing the contribution of directors who have been able to
develop, over a period of time, increasing insight into the Corporation and its
operations and, therefore, provide an increasing contribution to the Board as a
whole through this institutional knowledge.
13.
Director Compensation; Director and Executive Stock Ownership
Director compensation and stock ownership shall be
periodically reviewed by the Nominating and Corporate Governance
Committee. The Committees review shall
include a comparison of Couriers director compensation practices against the
practices of other comparable U.S. companies.
The Committees objectives include ensuring that the Corporations
non-management directors have a proprietary stake in the Corporation and that
the interests of the directors continue to be closely aligned with the
interests of the Corporations stockholders.
By January 31 of each year following the initial
election to the Board, each independent director is expected to have
stock-based holdings in Courier equal in value to a multiple of the annual
retainer initially payable to such director as set forth below:
Year after initial election
|
|
Multiple of annual retainer
|
|
1
st
|
|
1x
|
|
2
nd
|
|
2x
|
|
3
rd
|
|
3x
|
|
4
th
|
|
4x
|
|
5
th
and thereafter
|
|
5x
|
|
In the event of an increase in annual retainer the
Committee will review the need for an increase in directors stock-based
holdings. The following shares will be
counted in determining whether a director owns the requisite number of
shares: shares purchased on the open
market, shares or stock units issued pursuant to a stock equity plan of the
Corporation and shares owned by his or her spouse and/or children. Unexercised options will not be counted.
Executive officers of the Corporation are expected to
have stock based holdings in Courier at least equal to $100,000 in market value
by the first anniversary of their employment by the Corporation. The following shares will be counted in
determining whether an officer owns the requisite number of shares: shares purchased on the open market, shares
or stock units issued pursuant to a stock equity plan of the Corporation and
shares owned by his or her spouse and/or children. Unexercised options will not be counted.
36
14.
Board and Committee Self-Evaluation
The Nominating and
Corporate Governance Committee shall periodically evaluate the Directors
performance in executive session. Each Committee shall also conduct an
evaluation of its performance periodically in accordance with its respective
charter and applicable NASDAQ rules.
15.
Independent Advisors
The Board may collectively retain independent advisors
as it deems appropriate in its discretion.
16.
Interaction with Shareholders and Other Third Parties
Management shall be the
voice of the Corporation.
17.
Business Conduct Guidelines and Insider Trading Policy
Each Director shall
comply with the Business Conduct Guidelines and Statement of Policy on Insider
Trading and Disclosure adopted by the Corporation, including the provisions
relating to protecting confidential information of the Corporation and avoiding
conflicts of interests.
18.
Evaluation of the CEO
The performance of the
CEO shall be reviewed annually by the Compensation and Management Development
Committee. At the Boards request, the
Compensation and Management Development Committee shall report such performance
periodically to the Board in executive session.
19.
Management Resources and Succession
At the Boards request,
the Chair of the Compensation and Management Development Committee shall report
periodically to the Board in executive session on succession planning and
management development.
20.
Voting for Directors
In an uncontested
election, any nominee for director who receives a greater number of votes withheld
for his or her election than votes for such election shall promptly tender
his or her resignation after such election.
The
directors of the Board, giving due consideration to the best interests of the
Corporation and its stockholders, shall evaluate the relevant facts and
circumstances and shall make a decision, within 90 days after the election, on
whether to accept the tendered resignation. A director who tenders a
resignation pursuant to this provision shall not participate in the Boards
decision regarding acceptance of his or her resignation.
21. Amendments and Waivers
The Board may amend,
waive, suspend or repeal any of these Guidelines at any time, with or without
public notice, as it determines necessary or appropriate, in the exercise of
the Boards judgment and fiduciary duties.
As adopted by the
Board, effective September 18, 2007 and amended November 7, 2007
37
Courier
Electronic Voting Instructions
You can vote by Internet or telephone!
Available 24 hours a day, 7 days a week!
Instead of mailing your proxy, you may choose on of
the two following methods outlined below to vote your proxy.
VALIDATION
DETAILS ARE LOCATED BELOW IN THE TITLE BAR.
Proxies submitted by the Internet or telephone
must be received by 1:00 a.m., Central Time, on January 16, 2008.
Vote by the Internet
Log on the internet and go to
www.Investorvote.com
Follow the steps outlined on the secure
website.
Vote by telephone
Call toll free 1-800-652-VOTE (8683) within
the United States, Canada & Puerto Rico any time on a touch tone
telephone. There is NO CHARGE to you for your call.
Follow the instructions provided by the recorded message.
|
Using a
black ink
pen, mark your votes with
an X as shown in
this example. Please do not write outside the designated areas.
|
x
|
|
Annual Meeting Proxy Card
|
IF YOU HAVE NOT VOTED VIA THE INTERNET
OR
TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN
THE ENCLOSED ENVELOPE.
A. Proposals
|
|
|
|
|
|
|
|
The Board of Directors
recommends a vote
FOR
all the nominees listed and
FOR
Proposal
2.
|
|
|
|
|
For
|
Withhold
|
|
|
01 - Edward J. Hoff
|
o
|
o
|
|
|
02 - Robert P. Story,
Jr.
|
o
|
o
|
|
|
03 - Susan L. Wagner
|
o
|
o
|
|
|
|
|
|
|
|
|
For
|
Against
|
Abstain
|
|
2. Proposal to approve
the appointment of Deloitte & Touche LLP as the Independent Auditors of
the Corporation.
|
o
|
o
|
o
|
|
|
|
|
|
|
3. To transact such
other business as may
|
|
|
|
|
properly come before
the meeting
|
|
|
|
|
and/or any adjournment
or adjournments thereof.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
B. Non -
Voting Items
|
|
|
|
|
Change of
Address - Please print new address below
|
|
Comments -
Please print your comments below
|
C. Authorized
Signatures This section must be completed for your vote to be counted. Date
and sign below.
Please sign this proxy
exactly as your name(s) appear(s) on the books for the Corporation. Joint
owners should each sign personally. Trustees and other fiduciaries should
indicate the capacity in which they sign, and where more than one name appears,
a majority must sign. If a corporation, this signature should be that of an
authorized officer who should state his or her own title.
Date (mm/dd/yyyy)
Please print date below.
|
|
Signature 1 Please
keep signature within the box
|
|
Signature 2 Please
keep signature within the box
|
Dear Stockholder,
Please take note of the
important information enclosed with this Proxy Ballot. There are two issues
related to the management and operation of your Corporation that require your
immediate attention and approval. These are discussed in detail in the enclosed
proxy materials.
Your vote counts, and
you are strongly encouraged to exercise your right to vote your shares.
Please mark the boxes on
this proxy card to indicate how your shares will be voted. Then sign the card,
detach it and return your proxy vote in the enclosed postage paid envelope.
Your vote must be
received prior to the Annual Meeting of Stockholders, to be held at 11:00 AM.
on January 16, 2008 at Boston University Corporate Education Center, 72 Tyng
Road, Tyngsboro, Massachusetts 01879.
Thank you in advance for
your prompt consideration of these matters.
Sincerely,
COURIER CORPORATION
IF YOU HAVE NOT VOTED VIA THE INTERNET OR
TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN
THE ENCLOSED ENVELOPE.
Courier
Proxy
-
Courier Corporation
|
PROXY FOR THE ANNUAL MEETING OF
STOCKHOLDERS
-
JANUARY 16, 2008
THIS PROXY IS BEING SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The
undersigned stockholder of Courier Corporation (the Corporation) hereby
constitutes and appoints James F. Conway, III, W. Nicholas Thorndike and Kathleen
Foley Curley, and each of them singly, with full power of substitution, the
attorneys and Proxies of the undersigned, for and in the name, place and state
of the undersigned to attend the Annual Meeting of Stockholders of the Corporation
to be held on January 16, 2008, commencing at 11:00 a.m., and/or at any
adjournment or adjournments thereof (the Proxy Statement in connection
therewith and due notice of the time, place and purposes of such a meeting have
been received by the undersigned) and at such meeting and/or any adjournment or
adjournments thereof to vote and act with respect to all shares of Common Stock
of the Corporation standing in the name of the undersigned or in respect of
which the undersigned is entitled to vote, with all the powers the undersigned
would possess if personally present at said meeting and/or any adjournment or adjournments
thereof and especially to vote as follows, a majority of said attorneys and
Proxies, or any one if only one be present, to have all the powers of said
attorneys or proxies.
When properly executed,
this proxy will be voted in the manner directed by the undersigned
stockholders(s). If no direction is given, this proxy will be voted FOR the
election of the three nominees for Class A Directors, and FOR the ratification
for the selection of Deloitte & Touche LLP as the Corporations independent
public accountants; with discretionary authority to vote upon such other matters that may
properly come before the meeting. The Board of Directors recommends a vote FOR
Proposals 1 and 2. A stockholder wishing to vote in accordance with the Board
of Directors recommendations need only sign and date this proxy and return it
in the envelope provided.
The undersigned hereby
ratifies and confirms all that said attorneys and Proxies and each of them or
their substitute or substitutes may lawfully do or cause to be done by virtue
hereof revoking any proxy heretofore given with respect to such shares.
If you vote by
using the Internet, please DO NOT mail back this proxy card.
PLEASE VOTE,
DATE and SIGN ON REVERSE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.
(MM) (NASDAQ:CRRC)
Historical Stock Chart
From May 2024 to Jun 2024
(MM) (NASDAQ:CRRC)
Historical Stock Chart
From Jun 2023 to Jun 2024