Pursuant to our Non-Employee Director Compensation Plan, our non-employee directors were compensated as follows in 2022:
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•
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An annualized cash retainer of $70,000, paid in two semi-annual installments;
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•
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An additional $12,000 for each member of the Audit Committee, other than the Chair who receives $30,000;
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| • |
An additional $10,000 for each member of the Compensation Committee, other than the Chair who receives $20,000;
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|
•
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An additional $5,000 for each member of the Nominating and Corporate Governance Committee, other than the Chair who receives $15,000; and
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| |
|
| • |
An annual grant of Restricted Stock Units ("RSUs") on the first stock trading day of the year, determined as a total incentive value of
$180,000 divided by the closing stock price of the last trading day of the previous fiscal year, vesting in 3 years or ratably upon earlier cessation of service (other than for cause).
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Additional cash compensation was paid to the Chair of the Nominating and Corporate Governance Committee ($50,000) and to each other member of the
Nominating and Corporate Governance Committee ($40,000) for substantial non-recurring services provided during 2022 in connection with CEO and key executive succession planning and transition. Mrs. Ruta Zandman received additional cash compensation
of $150,000 in 2022 for her role as the director responsible for preserving the memory of the late Dr. Felix Zandman and the Company's corporate history.
Board members do not receive a per-meeting fee. Our employee directors are not separately compensated for services performed as directors. The Board evaluates
director compensation annually.
The following table provides information with respect to the compensation paid or provided to the Company's non-employee directors during 2022:
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NAME
|
FEES EARNED AND PAID IN CASH
|
|
|
STOCK
AWARDS(1)(6)
|
|
TOTAL
|
|
Dr. Renee B. Booth
|
$
|
80,000 |
|
|
|
$
|
172,995 |
|
$
|
252,995 |
|
| Michael J. Cody |
$ |
127,000 |
|
|
|
$ |
172,995 |
|
$ |
299,995 |
|
Dr. Michiko Kurahashi
|
$
|
70,000 |
|
|
|
$
|
172,995 |
|
$
|
242,995 |
|
|
Dr. Abraham Ludomirski
|
$
|
145,000
|
|
|
|
$
|
172,995
|
|
$
|
317,995
|
|
|
Ziv Shoshani
|
$
|
70,000
|
|
|
|
$
|
172,995
|
|
$
|
242,995
|
|
|
Timothy V. Talbert
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$
|
90,000
|
|
|
|
$
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172,995
|
|
$
|
262,995
|
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Jeffrey H. Vanneste(2)
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$
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91,000
|
|
|
|
$
|
172,995 |
|
$
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263,995
|
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Thomas C. Wertheimer(3)
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$
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55,000
|
|
|
|
$
|
172,995
|
|
$
|
227,995
|
|
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Ruta Zandman(4)
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$
|
220,000
|
|
|
|
$
|
172,995
|
|
$
|
392,995
|
|
|
Raanan Zilberman(5)
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$
|
121,000
|
|
|
|
$
|
172,995
|
|
$
|
293,995
|
|
|
(1)
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Amounts represent the fair value of the RSUs granted, determined in accordance with FASB ASC Topic 718 in the year of grant. The grant-date fair value is based on the same assumptions
described in Note 12 of our consolidated financial statements included in our Form 10-K filed on February 22, 2023, including the consideration of the present value of assumed dividends which are not received by the RSU holder during the
vesting period. Accordingly, the value of stock awards in the table above will be different than the stated “incentive value” described above. The grant-date fair value is recognized for accounting purposes over the respective vesting
periods.
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(2)
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Mr. Vanneste was appointed Chair of the Audit Committee effective May 24, 2022. The associated Committee Chair fees paid to
Mr. Vanneste in 2022 were prorated.
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(3)
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Mr. Wertheimer retired from the Board effective May 24, 2022. Upon his retirement, Mr. Wertheimer's outstanding restricted stock units vested proportionally, and the unvested portion of such
awards were forfeited. Although we have shown the full grant date fair value of his stock award in accordance with SEC rules, the grant date fair value of the portion of his 2022 stock award that vested was $22,744. |
| (4) |
Effective January 1, 2012, Mrs. Ruta Zandman was appointed as the director responsible for preserving the memory of the late Dr. Felix Zandman and the Company's corporate history. For her
continued service on this project, Mrs. Zandman receives $150,000 per annum in addition to her Board of Directors cash retainer of $70,000.
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(5)
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Mr. Zilberman was appointed to the Audit Committee effective May 24, 2022. The associated Committee fees paid to Mr.
Zilberman in 2022 were prorated.
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(6)
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As of December 31, 2022, the aggregate number of stock awards outstanding was as follows:
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| |
NAME
|
|
TOTAL STOCK AWARDS OUTSTANDING
|
|
| |
Dr. Renee B. Booth
|
|
8,230
|
|
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Michael J. Cody |
|
24,671
|
|
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Dr. Michiko Kurahashi
|
|
8,230 |
|
| |
Dr. Abraham Ludomirski
|
|
24,671
|
|
| |
Ziv Shoshani
|
|
24,671
|
|
| |
Timothy V. Talbert
|
|
24,671
|
|
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Jeffrey H. Vanneste
|
|
24,671
|
|
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Ruta Zandman
|
|
24,671
|
|
| |
Raanan Zilberman
|
|
24,671
|
|
| |
|
|
|
|
| |
|
|
|
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DIRECTOR STOCK OWNERSHIP GUIDELINES
To further align the interests of the Company's directors with its stockholders, the Board adopted stock ownership guidelines in 2016 applicable to the Company's
directors, which guidelines were amended and restated as of January 1, 2021 (the "Stock Ownership Guidelines"). The Stock Ownership Guidelines are as follows:
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•
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Each non-employee director should own an amount of shares of Vishay Common Stock equal to 5 times the value of the director's annual cash retainer, subject to a 5-year
phase-in period; and
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|
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•
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Following the 5-year phase-in period, non-employee directors who do not meet the required ownership threshold would receive shares in place of the director's annual cash retainer and be
subject to stock transfer restrictions until such time as the ownership threshold is satisfied.
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The following will be
considered "owned" for the purposes of the Stock Ownership Guidelines:
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•
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All shares underlying each non-employee director's outstanding time-based restricted stock and time-based restricted stock unit awards, whether or not vested;
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| |
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•
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Shares owned outright or otherwise beneficially owned by the non-employee director, his or her spouse and minor children, and any trust for the principal benefit of those individuals; and
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| |
|
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•
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Shares beneficially owned, whether directly or indirectly, by any investment fund or similar entity with which the non-employee director is affiliated.
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Compliance for non-employee directors will be measured on the first
trading day in January of each year.
The following table summarizes non-employee director compliance status with the Stock Ownership Guidelines as of January 3, 2023:
|
DIRECTOR
|
|
STATUS
|
|
Dr. Renee B. Booth
|
|
Compliant
|
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| Michael J. Cody |
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Compliant
|
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Dr. Michiko Kurahashi
|
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Compliant
|
|
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Dr. Abraham Ludomirski
|
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Compliant
|
|
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Ziv Shoshani
|
|
Compliant
|
|
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Timothy V. Talbert
|
|
Compliant
|
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Jeffrey H. Vanneste
|
|
Compliant
|
|
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Ruta Zandman
|
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Compliant
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Raanan Zilberman
|
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Compliant
|
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GOVERNANCE OF THE COMPANY
What is corporate
governance?
Corporate governance is the process by which companies govern themselves.
At Vishay, day-to-day business activities are carried out by our employees under the direction and supervision of our CEO. The Board of Directors oversees these activities. In doing
so, each director is required to use his or her business judgment in the best interests of Vishay and its stockholders. The Board's primary responsibilities include:
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•
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Review of Vishay's performance, strategies, and major decisions;
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•
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Oversight of Vishay's compliance with legal and regulatory requirements and the integrity of its financial statements;
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•
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Oversight of management, including review of the CEO's performance and succession planning for key management roles;
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| • |
Oversight of risk management; and |
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| • |
Oversight of compensation for the CEO, key executives and the Board, as well as oversight of compensation policies and programs for all employees. |
Additional description of the Board's responsibilities is included in our Corporate Governance Principles, which is available to stockholders on our website and in print upon request,
as described below.
Where can I find more
information about the corporate governance practices of Vishay?
Various corporate governance related documents are available on our website. These include:
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Corporate Governance Principles
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•
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Code of Business Conduct and Ethics
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•
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Code of Ethics for Financial Officers
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Audit Committee Charter |
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Nominating and Corporate Governance Committee Charter |
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Compensation Committee Charter |
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Executive Stock Ownership Guidelines
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•
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Director Stock Ownership Guidelines
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| • |
Clawback Policy
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| • |
Hedging - Pledging Policy
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| • |
Nominating and Corporate Governance Committee Policy Regarding Qualification of Directors |
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| • |
Related Party Transactions Policy |
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| • |
Ethics Helpline
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To view these documents, access ir.Vishay.com and click on "Corporate Governance." Any of these documents can be obtained in print by any stockholder upon written request to
Vishay's investor relations department.
We intend to post any amendments to or any waivers from, a provision of our Code of Business Conduct and Ethics or Code of Ethics for Financial Officers on our website.
What is
the composition of our Board of Directors?
Vishay has a staggered Board of Directors divided into three classes. The number of directors is fixed by the Board of Directors, subject to a minimum of three and a maximum of fifteen directors as
provided in the Company's charter documents. As described in Proposal One, one director is nominated for election as a Class I director for a term expiring at the annual meeting of stockholders in 2025 and three directors are nominated for election
as Class II directors for a term expiring at the annual meeting of stockholders in 2026. Biographical information on each of the current and nominated directors is included under the heading "Directors" on page 5.
How does
the Board determine which directors are considered independent?
The Board has adopted a formal set of director qualification standards used to determine director independence which meet the independence requirements of the NYSE corporate governance listing
standards. The Board has determined that, to be considered independent, a director may not have a direct or indirect material relationship with the Company other than as a director. A material relationship is one which impairs or inhibits, or has
the potential to impair or inhibit, a director's exercise of critical and disinterested judgment on behalf of the Company and its stockholders. The materiality standard applied by the Board includes, but is not limited to, the disqualifying
relationships set forth in the governance listing standards of the NYSE. The standards specify the criteria for determining director independence, including strict guidelines for directors and their immediate families regarding employment or
affiliation with us or our independent registered public accounting firm. The standards also prohibit the Audit Committee members from having any direct or indirect financial relationship with us.
The Nominating and Corporate Governance Committee, with the help of counsel, has reviewed the applicable legal standards for Board and committee member independence, the Company's
standards of independence and applied the criteria to determine "audit committee financial expert status". The Committee has also reviewed a summary of the answers to annual questionnaires completed by each director. On the basis of this review the
Committee has communicated its findings to the full Board and the Board has affirmatively concluded that Dr. Renee B. Booth, Michael J. Cody, Dr. Michiko Kurahashi, Dr. Abraham Ludomirski, Timothy Talbert, Jeffrey H. Vanneste, and Raanan
Zilberman qualify as independent directors. Each of the Audit Committee, the Nominating and Corporate Governance Committee, and the Compensation Committee of the Board is composed entirely of independent directors.
How often
did the Board meet during 2022?
The Board of Directors met ten times during the year ended December 31, 2022. Regularly scheduled executive sessions of the Board's independent directors were also held. In 2022,
each director attended at least 75% of the aggregate number of meetings of the Board of Directors and any committee on which such director served. Vishay's policy on director attendance at annual meetings of stockholders is included in
Vishay's Corporate Governance Principles which may be found on our website at ir.Vishay.com.
What is the role of the Board's
Committees and what is their composition?
| |
The Board of Directors maintains an Executive Committee, a Nominating and Corporate Governance Committee, an Audit Committee, and a Compensation Committee. Each Committee is described below. Copies of all committee charters are
available on our website and in print upon request. The composition of these Committees is summarized under "Directors" above.
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|
|
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Executive Committee - The Executive Committee is
authorized to exercise all functions of the Board of Directors in the intervals between meetings of the Board to the extent delegated by the Board and as permitted by Delaware law. The current Chair of the Committee is Mr. Zandman.
Nominating and Corporate Governance Committee - The
functions of the Nominating and Corporate Governance Committee include identifying individuals qualified to become members of the Board; selecting or recommending that the Board of Directors select the director nominees for the next annual meeting of
stockholders; developing and recommending to the Board Executive Officer succession plans; developing and recommending to the Board a set of corporate governance principles for Vishay; overseeing the evaluation of the Board and the management of
Vishay; administering Vishay's Related Party Transactions Policy; and performing other related functions specified in the committee's charter. The current Chair of the Committee is Dr. Abraham Ludomirski.
Audit Committee - The functions of the Audit
Committee include overseeing Vishay's accounting and financial reporting processes; overseeing the audits of our consolidated financial statements and the effectiveness of our internal control over financial reporting; assisting the Board in its
oversight of the integrity of our financial statements, our compliance with legal and regulatory requirements, the independence and qualifications of our independent registered public accounting firm, and the performance of our internal audit
function and independent registered public accounting firm; and performing other related functions specified in the committee's charter, including the administration of the Company's Stockholder Return Policy. The Audit Committee consists of at least
three non-management directors, each of whom satisfies the independence requirements of the rules of the SEC and the governance listing requirements of the NYSE. All of the members of the Committee also satisfy the financial literacy requirements of
the NYSE and our Board has determined that Mr. Jeffrey H. Vanneste, the current Chair of the committee, qualifies as an Audit Committee financial expert under the rules of the SEC.
Compensation Committee - The functions of the
Compensation Committee include evaluating the performance of the Chief Executive Officer; establishing and approving all compensation for our Executive Officers; making recommendations to the Board with respect to compensation of non-employee
directors; making recommendations to the Board with respect to, and administering, our incentive compensation plans and equity based compensation plans; and performing other related functions specified in the Committee's charter. The current Chair of
the Committee is Mr. Timothy Talbert. Also see "Executive Compensation."
The Chair of the Compensation Committee presides at the executive sessions of the Board's independent directors.
|
|
Executive Committee(1)
|
Audit Committee
|
Nominating and Corporate Governance Committee
|
Compensation Committee
|
|
Number of Meetings during 2022
|
-
|
10
|
5
|
7
|
|
(1)
|
The Executive Committee meets informally throughout the year to discuss various business issues. Informal meetings are not included in the number of meetings disclosed above.
|
What is
the Board's leadership structure?
The Board believes that it is important and in the Company's best interests to retain the flexibility to combine or separate the responsibilities of the offices of Chair of the
Board and CEO, as determined by the Board from time to time. The Board separated the positions of Chair and CEO in 2004 when the Company's late founder and Chairman, Dr. Felix Zandman, stepped down from his position as our CEO to focus mainly on
technical and business development issues. Mr. Marc Zandman succeeded Dr. Zandman as Executive Chair of the Board of Directors and Chief Business Development Officer upon Dr. Zandman's passing. Mr. Marc Zandman is significantly involved with the
Company's strategic direction as our Executive Chair and Chief Business Development Officer, overseeing our acquisition strategy. Accordingly, the Company believes that it is appropriate that he serve as Executive Chair. At the same time, the
active membership of our CEO on the Board assures our Board of the benefit of the CEO's comprehensive knowledge of the Company's business, operations, industry environment and competitive challenges.
As contemplated by our succession plan, Dr. Paul resigned from the Board of Directors upon his retirement as President and CEO effective December 31, 2022. The Board has determined
to retain the separation between the Chair and CEO roles. The Board appointed Joel Smejkal to succeed Dr. Paul as President and CEO, and appointed Mr. Smejkal to the Board of Directors effective January 1, 2023, to fill the vacancy presented by Dr.
Paul's resignation. Mr. Zandman will remain Executive Chair of the Board.
Independent directors and management have different perspectives and roles in strategy development. Our independent directors bring oversight skills and experience from outside the
Company and the industry, while our CEO and Executive Chair bring Company-specific expertise. This structure permits open discussion and assessment of the Company's ability to manage the risks and challenges the Company faces and provides the
appropriate balance between strategy development and independent oversight of management.
The independent directors meet in regularly scheduled executive sessions and when required, in special executive sessions.
What is the
Board's role in risk oversight?
Management continually monitors the material risks facing the Company, including financial risk, strategic risk, operational risk, cybersecurity risk, and legal and compliance risk.
The Board of Directors is responsible for exercising oversight of management's identification and management of, and planning for, those risks. Although the Board is ultimately responsible for risk oversight at the Company, the Board has delegated to
certain committees oversight responsibility for those risks that are directly related to their area of focus.
|
The Audit Committee reviews our policies and guidelines with respect to risk assessment
and risk management, including our material financial risk exposures and cybersecurity risk, and oversees the steps management has taken to monitor and control those exposures.
|
|
The Compensation Committee considers risk issues when establishing and administering our compensation programs for executive
officers and other key personnel.
|
|
The Nominating and Corporate Governance Committee
oversees corporate governance risks, including matters relating to the composition and organization of the Board and recommends
to the Board how its effectiveness can be improved by changes in its composition and organization.
|
Each of these committees routinely reports to the Board on the management of these specific risk areas. To permit the Board and its committees to perform their respective risk
oversight roles, individual members of management who supervise the Company's risk management report directly to the Board or the relevant committee of the Board responsible for overseeing the management of specific risks, as applicable.
The Board believes that full and open communication between management and the Board is essential for effective risk management and oversight. Members of the Company's senior
management regularly attend Board and committee meetings and are available to address any questions or concerns raised on matters related to risk management. The Board and its committees exercise their risk oversight function by carefully evaluating
the reports they receive from management and by making inquiries of management with respect to areas of particular interest to the Board.
How does the
Board select nominees for the Board?
In selecting candidates for nomination at the annual meeting of our stockholders, the Nominating and Corporate Governance Committee begins by determining whether the incumbent
directors whose terms expire at the meeting desire and are qualified to continue their service on the Board. We are of the view that the repeated service of qualified incumbents promotes stability and continuity in the boardroom, giving us the benefit
of the familiarity and insight into our affairs that our directors have accumulated during their tenure and contributing to the Board's ability to work as a collective body. Accordingly, it is the policy of the Committee, absent special circumstances,
to nominate qualified incumbent directors who continue to satisfy the Committee's criteria for membership on the Board, who the Committee believes will continue to make important contributions to the Board, and who consent to stand for re-election and,
if re-elected, to continue their service on the Board. If there are Board positions for which the Committee will not be re-nominating a qualified incumbent, the Committee will solicit recommendations for nominees from persons who the Committee
believes are likely to be familiar with qualified candidates, including members of the Board and senior management.
The Committee may also engage an independent search firm to assist in identifying qualified candidates. Where such a search firm is engaged, the Committee will set the fees and scope
of engagement. The Committee will review and evaluate each candidate who it believes merits serious consideration, taking into account all available information concerning the candidate, the qualifications for Board membership established by the
Committee, the existing composition and mix of talent and expertise on the Board and other factors that it deems relevant. In conducting its review and evaluation, the Committee may solicit the views of management and other members of the Board and
may, if deemed helpful, conduct interviews of proposed candidates. The Committee will evaluate candidates recommended by stockholders in the same manner as candidates recommended by other persons, except that the Committee may consider, as one of the
factors in its evaluation of stockholder recommended candidates, the size and duration of the interest of the recommending stockholder or stockholder group in the equity of Vishay and whether the stockholders or stockholder group intend to continue
holding its interest through the annual meeting date.
What
qualifications must a director have?
Candidates for nomination to our Board are selected by the Nominating and Corporate Governance Committee in accordance with the Committee's charter, our Certificate of Incorporation,
our Bylaws and our Corporate Governance Principles. Under our Nominating and Corporate Governance Committee Policy Regarding Qualifications of Directors, which can be found on our website, we require that all candidates for director (including the
continued service of existing members) be persons of integrity and sound ethical character; be able to represent all stockholders fairly; have no interests that materially conflict with those of Vishay and its stockholders; have demonstrated
professional achievement; have meaningful management, advisory or policy making experience; have a general appreciation of the major business issues facing the Company; and have adequate time to devote to serve on the Board of Directors. When
considering nominees, the Nominating and Corporate Governance Committee may also consider whether the candidate possesses the qualifications, experience and skills it considers appropriate in the context of the Board's overall composition and needs. A
limited exception to some of these requirements, other than the requirements of integrity and ethics and the absence of material conflict, may be made for a holder of substantial voting power. Additionally, directors may not stand for re-election
after the age of 75 unless the Board makes an affirmative determination that, because of the importance and value of the continued service of a director, the retirement policy should be waived, and in no event may a director stand for re-election after
the age of 85. This policy does not apply to any person who controls more than 20% of the voting power of the Company. We also require that a majority of directors be independent; at least three of the directors have the financial literacy necessary
for service on the Audit Committee and at least one of these directors qualifies as an Audit Committee financial expert; at least some of the independent directors have served as senior executives of public or substantial private companies; and at
least some of the independent directors have general familiarity with the industries in which we operate. Additionally, while the Company does not have a formal policy with respect to the consideration of diversity in identifying director candidates,
the benefits of board diversity are considered in the nominations process, including diversity of background and experience. A detailed description of the qualifications required of candidates for director, as well as the specific qualities or skills
we believe should be possessed by one or more directors, can be found on our website under our Nominating and Corporate Governance Committee Policy Regarding Qualifications of Directors.
To assist it with its evaluation of the director nominees for election at the 2023 annual meeting of stockholders, the Nominating and Corporate Governance Committee took into account
all of the factors listed above. In the section "Directors", under the headings "Nominee for Term Expiring 2025" and "Nominees for Terms Expiring 2026", we provide an overview of each nominee's principal occupation, together with the qualifications,
key attributes and skills that the Nominating and Corporate Governance Committee and the Board believes will best serve the interests of the Board, the Company and our stockholders.
Can I
recommend a nominee for director?
Yes. The Nominating and Corporate Governance Committee will consider recommendations for director nominations submitted by stockholders entitled to vote generally in the election of
directors. Submissions must be made in accordance with the Committee's procedures, as outlined below and set forth on our website. For each annual meeting of our stockholders, the Committee will accept for consideration only one recommendation from
any stockholder or affiliated group of stockholders. The Committee will only consider candidates who satisfy our minimum qualifications for director, as summarized in this proxy statement and as set forth on our website. In considering a stockholder
recommendation, the Committee will take into account, among other factors, the size and duration of the recommending stockholder's ownership interest in Vishay and whether the stockholder intends to continue holding that interest through the annual
meeting date. Stockholders should be aware, as discussed above, that it is our general policy to re-nominate qualified incumbent directors and that, absent special circumstances, the Committee will not consider other candidates when a qualified
incumbent director consents to stand for re-election.
A stockholder wishing to recommend to the Nominating and Corporate Governance Committee a candidate for election as director must submit the recommendation in writing, addressed to
the Committee, care of our Corporate Secretary, at Vishay Intertechnology, Inc., 63 Lancaster Avenue, Malvern, PA 19355. Submissions must be made by mail, courier, or personal delivery. E-mailed submissions will not be considered. Submissions
recommending candidates for election at an annual meeting of stockholders must generally be received no later than 120 calendar days prior to the first anniversary of the date of the proxy statement for the prior annual meeting of stockholders. In the
event that the date of an annual meeting of stockholders is more than 30 days following the first anniversary date of the annual meeting of stockholders for the prior year, the submission must be made a reasonable time in advance of the mailing of our
proxy statement for the current year. Each nominating recommendation must be accompanied by the information called for by our "Procedures for Securityholders' Submission of Nominating Recommendations". This includes specified information concerning
the stockholder or group of stockholders making the recommendation and the proposed nominee, any relationships between the recommending stockholder or stockholders and the proposed nominee and the qualifications of the proposed nominee to serve as
director. The recommendation must also be accompanied by the consent of the proposed nominee to serve if nominated and elected and the agreement of the nominee to be contacted by the Committee, if the Committee decides in its discretion to do so.
How do
stockholders and others communicate with the Board?
Vishay stockholders may communicate with the Board of Directors, any committee of the Board or any individual director, and any interested party may communicate with the independent
directors of the Board as a group, by delivering such communications either in writing addressed or by e-mail to:
|
|
|
By Mail
|
|
|
|
By e-mail
|
 |
|
Corporate Secretary
Vishay Intertechnology, Inc.
63 Lancaster Avenue
Malvern, PA 19355
|
|
|
|
boardofdirectors@Vishay.com
Communications should not exceed 1,000 words
|
All communications must be accompanied by the following information: (i) if the person submitting the communication is a securityholder, a statement of the type and amount of the
securities of Vishay that the person holds; (ii) if the person submitting the communication is not a securityholder and is submitting the communication to the independent directors as an interested party, the nature of the person's interest in Vishay;
(iii) any special interest, meaning an interest not in the capacity as a securityholder of Vishay, of the person in the subject matter of the communication; and (iv) the address, telephone number and e-mail address, if any, of the person submitting the
communication. Communications addressed to directors may, at the direction of the directors, be shared with Vishay's management.
RATIFICATION OF APPOINTMENT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
The Audit Committee of the Board of Directors is responsible for the selection of our independent registered public accounting firm. The Committee has determined to reappoint the
public accounting firm of Ernst & Young LLP as independent registered public accounting firm to audit our financial statements for the fiscal year ending December 31, 2023, as well as to audit the effectiveness of our internal control over
financial reporting. Although stockholder approval for the appointment of the independent registered public accounting firm is not required, we are continuing our practice of submitting the selection of the independent registered public accounting
firm to stockholders for their ratification.
Ernst & Young LLP has served as our independent registered public accounting firm continuously since 1968. The Audit Committee believes that the knowledge of the Company's
business gained by Ernst & Young LLP through this period of service is valuable. Pursuant to the SEC rules, the lead partner must be rotated after five years, which provides the Company and its stockholders the benefit of new thinking and
approaches.
Representatives of the firm of Ernst & Young LLP are expected to be present at the Annual Meeting and will have an opportunity to make a statement if they so desire and will be
available to respond to appropriate questions from stockholders.
Under the Audit and Non-Audit Services Pre-Approval Policy that was adopted by the Audit Committee in May 2003 (which was amended and restated in October 2010), the Audit Committee
must pre-approve all audit and non-audit services provided to Vishay by the independent registered public accounting firm. The policy sets forth the procedures and conditions for pre-approval of these services. The Audit Committee has pre-approved
generally the engagement of the independent registered public accounting firm for services relating to our filings with the SEC (including comfort letters and consents for securities offerings), acquisition or disposition related diligence activities,
internal control review and compliance, interpretation and compliance with accounting and accounting-related disclosure rules and standards, certain attest services, domestic and international tax planning and compliance, and risk management.
The following table sets forth the aggregate fees billed by Ernst & Young LLP for audit and non-audit services rendered to Vishay in 2022 and 2021. These fees are categorized as
audit fees, audit-related fees, tax fees, and all other fees. The nature of the services provided in each category is described following the table.
|
|
|
|
2022
|
|
|
2021
|
|
|
Audit fees |
|
$
|
5,200,000
|
|
|
$
|
5,300,000
|
|
|
Audit-related fees |
|
|
200,000
|
|
|
|
-
|
|
|
Tax fees |
|
|
600,000
|
|
|
|
600,000
|
|
|
All other fees |
|
|
100,000
|
|
|
|
100,000
|
|
|
Total fees |
|
$
|
6,100,000
|
|
|
$
|
6,000,000
|
|
Audit fees. These fees generally consist of
professional services rendered for the audits of the consolidated financial statements of Vishay and its internal control over financial reporting, quarterly reviews, statutory audits, issuance of consents, and assistance with and review of documents
filed with the SEC.
Audit-related fees. These fees generally consist of assurance and other
services related to the performance of the audit or review of Vishay's financial statements or that are traditionally performed by the independent registered public accounting firm, and consultations concerning financial accounting and reporting
standards.
Tax fees. These fees generally relate primarily to tax compliance,
including review and preparation of corporate and expatriate tax returns, assistance with tax audits, review of the tax treatment for certain expenses, extra-territorial tax analysis, and tax due diligence relating to acquisitions. They also include
fees for state and local tax planning and consultations with respect to various domestic and international tax matters.
All other fees. These fees generally consist of reviews for compliance with
various government regulations, risk management and treasury reviews and assessments and audits of various contractual arrangements.
Vishay did not make use in 2022 of the rule that waives pre-approval requirements for non-audit services in certain cases if the fees for these services constitute less than 5% of the
total fees paid to the independent registered public accounting firm during the year.
|
The Audit Committee and the Board of Directors recommend that
you vote "FOR"
the ratification of the appointment of Ernst &
Young LLP as our independent registered public accounting firm for the year ending December 31, 2023.
|
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
On March 27, 2023, the record date for the Annual Meeting, Vishay had
128,009,490 shares of common stock (excluding treasury shares) and 12,097,148 shares of Class B common stock outstanding and entitled to vote. Shares of treasury stock are not entitled to vote at the Annual Meeting.
Each share of common stock outstanding and eligible to vote entitles the
holder to one vote, and each share of Class B common stock entitles the holder to ten votes.
Class B shares are transferable only to certain permitted transferees while the common stock is freely transferable. Class B shares are convertible on a one-for-one basis at any time
into shares of common stock. Transfers of Class B shares other than to permitted transferees result in the automatic conversion of the Class B shares into common stock. Voting is not cumulative. The percentage of total voting power below represents
voting power with respect to all shares of common stock and Class B common stock, as a single class, calculated on the basis of ten votes per share of Class B common stock and one vote per share of common stock.
The following table shows the number of shares of Vishay common stock and Class B common stock beneficially owned by (a) each director and director nominee, (b) each "Executive
Officer" identified under "Executive Compensation," (c) the directors, director nominees, and executive officers of Vishay as a group, and (d) any person owning more than 5% of Vishay common stock or the Class B common stock. Unless otherwise noted,
the information is stated as of the record date, and the beneficial owners exercise sole voting or dispositive power over their shares. The percentages of class and voting power amounts set forth in the table below are based on the number of shares outstanding and eligible to vote as of the record date, rather than based on
the percentages set forth in stockholders’ Schedules 13G or 13D, as applicable, filed with the SEC.
|
|
|
COMMON STOCK
|
|
|
CLASS B COMMON STOCK
|
|
|
|
|
NAME
|
|
SHARES OF STOCK
|
|
|
PERCENT OF CLASS
|
|
|
SHARES OF STOCK
|
|
PERCENT OF CLASS
|
|
VOTING POWER
|
|
Directors and Executive Officers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marc Zandman
|
|
|
-
|
|
|
|
*
|
|
|
|
8,618,334
|
(2)
|
|
71.2
|
%
|
|
|
34.6
|
%
|
Dr. Renee B. Booth
|
|
|
- |
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
*
|
|
| Michael J. Cody |
|
|
21,246 |
|
|
|
* |
|
|
|
- |
|
|
- |
|
|
|
* |
|
Peter Henrici
|
|
|
-
|
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
*
|
|
Dr. Michiko Kurahashi
|
|
|
- |
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
*
|
|
|
Lori Lipcaman
|
|
|
63,985
|
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
*
|
|
|
Dr. Abraham Ludomirski
|
|
|
111,096
|
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
*
|
|
Dr. Gerald Paul
|
|
|
204,389
|
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
*
|
|
Andreas Randebrock
|
|
|
- |
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
* |
|
Roy Shoshani
|
|
|
2,974
|
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
*
|
|
|
Ziv Shoshani
|
|
|
41,643
|
|
|
|
*
|
|
|
|
8,616,834
|
(3)
|
|
71.2
|
%
|
|
|
34.6
|
%
|
|
Joel Smejkal
|
|
|
11,897 |
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
*
|
|
|
Timothy V. Talbert
|
|
|
67,764
|
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
*
|
|
Clarence Tse
|
|
|
49,377
|
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
*
|
|
David Valletta
|
|
|
57,635
|
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
*
|
|
Johan Vandoorn
|
|
|
56,035
|
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
*
|
|
Jeffrey H. Vanneste
|
|
|
7,718 |
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
*
|
|
Jeff Webster
|
|
|
- |
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
*
|
|
|
Ruta Zandman
|
|
|
45,732
|
|
|
|
*
|
|
|
|
10,849,383
|
(1)
|
|
89.7
|
%
|
|
|
43.6
|
%
|
|
Raanan Zilberman
|
|
|
7,750
|
|
|
|
*
|
|
|
|
-
|
|
|
-
|
|
|
|
*
|
|
|
All Directors and Executive Officers as a group (16 Persons)(4)(5)
|
|
|
381,805 |
|
|
|
* |
|
|
|
10,850,883
|
|
|
89.7
|
% |
|
|
43.7 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Eugenia Ames(7) |
|
|
-
|
|
|
|
* |
|
|
|
2,232,549 |
|
|
18.5 |
% |
|
|
* |
(6) |
| Deborah S. Larkin(8) |
|
|
- |
|
|
|
* |
|
|
|
706,755 |
|
|
5.8 |
% |
|
|
2.8 |
% |
| BlackRock, Inc.(9) |
|
|
15,679,609 |
|
|
|
11.8
|
% |
|
|
- |
|
|
- |
|
|
|
6.3 |
% |
| Dimensional Fund Advisors, LP(10) |
|
|
9,290,115 |
|
|
|
7.0 |
% |
|
|
- |
|
|
- |
|
|
|
3.7 |
% |
| The Vanguard Group, Inc.(11) |
|
|
13,736,683 |
|
|
|
10.3 |
% |
|
|
- |
|
|
- |
|
|
|
5.5 |
% |
* Represents less than 1% of the outstanding shares of such class or the total voting power, as the case may be.
|
(1)
|
Includes 8,616,834 shares of Class B common stock held in a family trust, of which Mrs. Ruta Zandman, Mr. Marc Zandman and Mr. Ziv Shoshani are co-trustees, and have shared voting power. Pursuant to an agreement
related to that family trust, each of Mrs. Zandman and Messrs. Zandman and Shoshani is required to cause shares controlled by the trust to be voted in support of the election of each of the co-trustees as directors of the Company.
Additionally, includes 2,232,549 shares of Class B common stock that are subject to a voting agreement pursuant to which Mrs. Zandman, as Voting Representative, may direct the voting of such shares.
|
| |
|
|
(2)
|
Includes the same 8,616,834 shares of Class B common stock held in a family trust, of which Mrs. Ruta Zandman, Mr. Marc Zandman and Mr. Ziv Shoshani are co-trustees, and have shared voting power. Pursuant to an
agreement related to that family trust, each of Mrs. Zandman and Messrs. Zandman and Shoshani is required to cause shares controlled by the trust to be voted in support of the election of each of the co-trustees as directors of the Company.
Additionally, includes 750 shares of Class B common stock directly owned by Mr. Marc Zandman; and 750 shares of Class B common stock owned by one of Mr. Marc Zandman's children.
|
| |
|
| (3) |
Includes the same 8,616,834 shares of Class B common stock held in a family trust, of which Mrs. Ruta Zandman, Mr. Marc Zandman and Mr. Ziv
Shoshani are co-trustees, and have shared voting power. Pursuant to an agreement related to that family trust, each of Mrs. Zandman and Messrs. Zandman and Shoshani is required to cause shares controlled by the trust to be voted in support of the
election of each of the co-trustees as directors of the Company. |
| |
|
(4)
|
Total for All Directors and Executive Officers as a group excludes Dr. Gerald Paul, Johan Vandoorn, Clarence Tse, and David
Valletta, each of whom ceased being an executive officer of the Company as of December 31, 2022.
|
| |
|
| (5) |
The business address for all directors and officers is: c/o Vishay Intertechnology, Inc., 63 Lancaster Avenue, Malvern, PA 19355.
|
| |
|
| (6) |
Such shares are subject to a voting agreement pursuant to which Mrs. Ruta Zandman, as Voting Representative, may direct the voting of such shares, and are included in the 2,232,549 shares of Class B common stock
reported as being beneficially owned by Mrs. Zandman in Footnote 1. Ms. Ames has dispositive power of such shares. Ms. Ames is the record holder of 506,216 of these shares; the balance of the shares are held by trusts for the benefit of Ms.
Ames's children and other family members.
|
| |
|
| (7) |
The business address for Eugenia Ames is Janney Montgomery Scott, 780 Route 37 West, Suite 130, Toms River, NJ 08755, c/o Mr. Leroy Rachlin. |
| |
|
| (8) |
The business address for Deborah S. Larkin is World Financial, 270 Madison Avenue, Suite 1503, New York, NY 10016, c/o Mr. Bruce Auerbach. |
| |
|
(9)
|
Based on information provided in a Schedule 13G/A filed on January 24, 2023, by BlackRock, Inc. According to the Schedule
13G/A, BlackRock, Inc. may be deemed to have sole power to vote or direct the vote with respect to 15,394,321 shares of common stock; and sole power to dispose or direct the disposition with respect to 15,679,609 shares. BlackRock, Inc. is
located at 55 East 52nd Street, New York, New York 10055.
|
| |
|
| (10) |
Based on information provided in a Schedule 13G/A filed on February 10, 2023, by Dimensional Fund Advisors, LP. According to the Schedule 13G/A, Dimensional Fund Advisors, LP may be deemed to have sole power to
vote or direct the vote with respect to 9,174,595 shares of common stock; and sole power to dispose or direct the disposition with respect to 9,290,115 shares. Dimensional Funds Advisors, LP is located at 6300 Bee Cave Road, Building One,
Austin, Texas 78746.
|
| |
|
| (11) |
Based on information provided in a Schedule 13G/A filed on February 9, 2023, by The Vanguard Group, Inc. According to the Schedule 13G/A, The Vanguard Group, Inc. may be deemed to have shared power to vote or
direct the vote with respect to 147,312 shares of common stock; sole power to dispose or direct the disposition with respect to 13,459,007 shares; and shared power to dispose or direct the disposition with respect to 277,676 shares. The
Vanguard Group, Inc. is located at 100 Vanguard Blvd., Malvern, PA 19355.
|
| |
|
| |
|
| |
|
Section 16(a) Delinquent Reports
Section 16(a) of the Exchange Act, as amended, requires our directors and executive officers and persons who beneficially own more than ten percent of our common stock to report their
ownership of and transactions in our stock in filings with the SEC. Vishay believes, based solely on a review of our records and other publicly available information, that our directors and executive officers and persons who beneficially own more than
ten percent of our common stock complied with all applicable Section 16(a) reporting requirements during the year ended December 31, 2022, except for one sale by Dr. Paul which was not timely reported on Form 4.
Compensation Committee Interlocks and Insider Participation
No member of the Compensation Committee was at any time during 2022 an officer or employee of Vishay or any of the Company's subsidiaries nor was any such person a former officer of
Vishay or any of the Company's subsidiaries. In addition, no Compensation Committee member is an executive officer of another entity at which one of the Company's executive officers serves on the board of directors.
Restrictions
on Hedging and Pledging
The Board considers it inappropriate for persons employed by or associated
with the Company to engage in certain transactions related to the securities of the Company which could result in their interests no longer being aligned with the same interests and objectives as other stockholders of the Company. Therefore, as part
of its Securities Trading Policy, we restrict these persons from hedging, engaging in short-sales, transacting in publicly traded options, and pledging securities of the Company.
The restrictions apply to all directors, officers, employees, and
consultants of the Company or its subsidiaries (“service providers”) as well as family members and any others that reside with a service provider. Family members who do not reside with a service provider are subject to the restrictions if a service
provider directs, influences, or controls their transactions in securities of the Company. This includes, for example, parents or children of a service provider who consult with the service provider regarding their trades. Lastly, entities that a
service provider influences or controls, such as corporations, partnerships or trusts, are subject to the restrictions (collectively, the “covered persons”).
Hedging. Certain hedging and monetization transactions, such as zero-cost collars and forward sale contracts, involve the establishment of a short position in securities of the Company and limit or
eliminate the covered person’s ability to profit from an increase in the value of securities of the Company. Accordingly, these transactions can cause a covered person’s interests to be misaligned with other stockholders of the Company. The Company
therefore prohibits all hedging and monetization transactions involving securities of the Company. Short sales of securities of the Company (sales of securities that are not then owned), including a “sale against the box” (a sale with delayed
delivery), and transactions in publicly traded options in securities of the Company, such as puts, calls and other derivative securities, are also prohibited.
Pledging. Securities of the Company held in a margin account or pledged as collateral for a loan may be sold without the covered person’s consent if he or she fails to meet a margin call or defaults
on a loan, which may occur at a time when the covered person is aware of material nonpublic information or is otherwise not permitted to trade in Company securities. Therefore, these activities are prohibited.
Information Concerning Executive Officers
This Executive Compensation section describes the overall compensation practices at Vishay and specifically describes the total compensation of our Executive Officers.
The Executive Officers of Vishay along with their respective ages and positions with Vishay, as of December 31, 2022, were as follows:
|
NAME
|
|
AGE
|
|
POSITION
|
|
|
|
|
|
|
|
Marc Zandman(1)
|
|
61
|
|
Executive Chair of the Board, Chief Business Development Officer, President – Vishay Israel Ltd.
|
Dr. Gerald Paul(2)
|
|
73
|
|
Chief Executive Officer, President and Director
|
|
Lori Lipcaman
|
|
65
|
|
Executive Vice President and Chief Financial Officer
|
| Johan Vandoorn(2) |
|
65
|
|
Executive Vice President and Chief Technical Officer
|
| David Valletta(2) |
|
62
|
|
Executive Vice President Worldwide Sales
|
Joel Smejkal(1)(3)
|
|
56 |
|
Executive Vice President Corporate Business Development
|
| Clarence Tse(2) |
|
64
|
|
Executive Vice President and Business Head Semiconductors
|
|
|
|
52
|
|
Executive Vice President and Business Head Passive Components
|
Andreas Randebrock
|
|
58 |
|
Executive Vice President Global Human Resources |
|
(1)
|
Biography is provided with the Directors' biographies under the heading "Directors".
|
(2)
|
As of January 1, 2023, Dr. Paul and Messrs. Vandoorn, Tse, and Valletta are no longer Executive Officers of the Company.
|
(3)
|
The Board appointed Joel Smejkal as President and CEO and Jeff Webster to the newly created position of Chief Operating Officer, each effective
January 1, 2023.
|
 |
|
|
Dr. Gerald Paul served as Chief Executive Officer from January 1, 2005 until his retirement effective December 31, 2022. Dr. Paul served as a Director of the Company since 1993,
and was President of the Company since March 1998. Dr. Paul also was Chief Operating Officer from 1996 to 2006. Dr. Paul previously was an Executive Vice President of the Company from 1996 to 1998, and President of Vishay Electronic
Components, Europe from 1994 to 1996. Dr. Paul was Managing Director of Vishay Electronic GmbH, a subsidiary of the Company, since 1991. Dr. Paul was employed by Vishay and a predecessor company since 1978. Dr. Paul retired as President and
CEO effective December 31, 2022.
|
| |
|
|
|
|
|
|
|
Lori Lipcaman was appointed Executive Vice President and Chief Financial Officer of the Company effective September 1, 2011. Ms. Lipcaman had been appointed Executive Vice
President and Chief Accounting Officer in September 2008. Previously, she served as Vishay's Corporate Senior Vice President, Operations Controller, from March 1998 to September 2008. Prior to that, she served in various positions of
increasing responsibility in finance and controlling since joining the Company in May 1989.
|
 |
|
|
Johan Vandoorn served as Executive Vice President and Chief Technical Officer from August 1, 2011 until December 31, 2022. Mr. Vandoorn was responsible for Vishay's technical
development and internal growth programs. Mr. Vandoorn held various positions of increasing responsibility since Vishay's acquisition of BCcomponents Holdings BV ("BCcomponents") in 2002, including Executive Vice President – Passive
Components (2006 – 2012). Mr. Vandoorn had been Vice President – Global Operations of BCcomponents from 2000 until its acquisition by Vishay, and previously worked for Philips Components ("Philips") from 1980 until Philips sold the
BCcomponents business to a private equity firm in 1998.
|
| |
|
|
|
 |
|
|
David Valletta served as Vishay's Executive Vice President – Worldwide Sales from January 1, 2007 until December 31, 2022. Mr.
Valletta held various positions of increasing responsibility since Vishay's acquisition of Vitramon in 1994. Prior to joining Vitramon, Mr. Valletta also worked for AVX Corporation. His experience with Vishay included various positions
within the Americas region in direct and distribution sales management and global sales responsibility for the Company's key strategic customers.
|
| |
|
|
|
 |
|
|
Clarence Tse served as Executive Vice President and Business Head Semiconductors from January 1, 2017 until December 31, 2022.
Mr. Tse held various positions of increasing responsibility since Vishay's acquisition of Siliconix/Telefunken in 1998, including Senior Vice President, Diodes Division (2008 - 2016), Senior Vice President, Power Diodes Division (2002 - 2008)
and Vice President, Finance and Administration Asia (1998 - 2001). Mr. Tse was first hired by Siliconix in 1985.
|
| |
|
|
|
|
|
|
|
Jeff Webster was appointed Chief Operating Officer
effective January 1, 2023. Mr. Webster has held various positions of increasing responsibility since joining Vishay in 2000 including Executive Vice President and Business Head Passive Components (2020 - 2022), Senior Vice President Global
Quality (2014 - 2019), and Vice President Global Quality - Actives (2000 - 2014). Prior to joining Vishay, Mr. Webster worked for Intersil. Mr. Webster's experience includes roles in quality, operations, and R&D. |
| |
|
|
|
 |
|
|
Andreas Randebrock was appointed Executive Vice President Global Human Resources effective July 1, 2020.
Mr. Randebrock has been working for Vishay since 2015 as Senior Vice President Employee Development. Before Mr. Randebrock joined Vishay he worked as a management consultant in the field of leadership, human resources, and organizational
consulting for more than 20 years. From 1998 until 2015, Mr. Randebrock was employed by the global human resources consultancy Hay Group (acquired in 2015 by Korn Ferry) where he held various positions of increasing responsibility and was a
partner. |
2023 Appointments
In anticipation of Dr. Paul's eventual retirement, the Board's independent Nominating and Corporate Governance Committee, in conjunction with the Board of
Directors, was engaged in succession planning for some time to ensure a smooth evolution of Vishay's strategic priorities.
The Executive Officers of
Vishay along with their respective ages and positions with Vishay, as of January 1, 2023, are as follows:
|
NAME
|
|
AGE
|
|
POSITION
|
|
|
|
|
|
|
| Marc Zandman(1) |
|
61
|
|
Executive Chair of the Board, Chief Business Development Officer, President – Vishay Israel Ltd.
|
Joel Smejkal(1)
|
|
56
|
|
Chief Executive Officer, President and Director
|
|
|
|
52 |
|
Executive Vice President and Chief Operating Officer |
|
|
|
65
|
|
Executive Vice President and Chief Financial Officer
|
Roy Shoshani
|
|
49
|
|
Executive Vice President - Chief Technical Officer
|
Peter Henrici
|
|
67
|
|
Executive Vice President - Corporate Development
|
Andreas Randebrock(2)
|
|
58
|
|
Executive Vice President Global Human Resources |
|
(1)
|
Biography is provided with the Directors' biographies under the heading "Directors".
|
(2)
|
Biography is provided above under Information Concerning Executive Officers.
|
 |
|
|
Roy Shoshani was appointed
Executive Vice President - Chief Technical Officer effective January 1, 2023. Mr. Shoshani has held various positions of increasing responsibility since joining Vishay in 2004, including Deputy to the Chief
Technical Officer (2021-2022), Vice President Integrated Circuits Division (2009-2022), and Vice President R&D – Semiconductors (2019-2021). Prior to joining Vishay, Mr. Shoshani worked for Harmonic. Mr. Shoshani’s experience with
Vishay includes divisional leadership roles in R&D, marketing, business development and operations. Roy Shoshani is the brother of director Ziv Shoshani.
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Peter Henrici was appointed Executive Vice President - Corporate Development effective January 1, 2023. Mr. Henrici will continue to serve as the Corporate Secretary. Mr. Henrici has held various
positions in marketing communications, investor relations, and corporate treasury departments since joining Vishay in 1998. Mr. Henrici has been responsible for corporate communications since 2005 and he was appointed Corporate Secretary
in 2012.
|
Officers serve, at the discretion of the Board of Directors, until the meeting of the Board of Directors next following each annual meeting of stockholders, subject to their rights under any contracts
of employment described under "Compensation Discussion and Analysis."
Compensation Discussion and Analysis
Overview
The Compensation Committee of the Board of Directors establishes and approves all compensation for all Executive Officers and administers Vishay's incentive and equity-based
compensation plan.
SEC disclosure rules require tabular presentation regarding the compensation of the registrant's principal executive officer ("PEO"), principal financial officer ("PFO"), and the
registrant's three mostly highly compensated executive officers other than the PEO and PFO. Dr. Paul and Messrs. Vandoorn, Valletta, and Tse served as Executive Officers through the end of 2022. As such, these Executive Officers are included in the
Compensation Discussion and Analysis and within the required Compensation Tables, when applicable. Because the Compensation Committee determines compensation for all Executive Officers, this Compensation Discussion and Analysis discusses compensation
of all of our 2022 Executive Officers. The required "Compensation Tables" beginning on page 50 include only the five executives required to be disclosed in this manner by SEC rules. Discussion of 2023 compensation for our Executive Officers, including
some changes in our overall compensation structure, is described under the heading "2023 Executive Compensation" beginning on page 67.
Compensation Philosophy Generally
Vishay's compensation programs are designed to support our business goals and promote the short- and long-term profitable growth of the Company. Vishay's equity plans are designed
to ensure that executive compensation programs and practices are aligned with the long-term interests of Vishay's stockholders. Total compensation of each individual varies with individual performance and Vishay's overall performance in achieving
financial and non-financial objectives.
The Compensation Committee and Vishay's management believe that compensation should help to recruit, retain, and motivate key employees who can function effectively both in periods
of recession and economic expansion. Ordinarily an executive officer's total compensation should consist of a combination of cash payments and equity awards, to achieve the right balance between short- and long-term performance. Equity-based
compensation should serve to align the interests of management with those of stockholders. Severance protection and retirement benefits should provide executives with an appropriate level of job security, commensurate with their contributions to the
Company and their tenure.
The Compensation Committee, in consultation with our Chief Executive Officer, undertakes an annual review of the compensation arrangements of
Vishay's other executive officers.
Performance Philosophy
The Company's compensation philosophy is intended to integrate with its philosophy of evaluating operating performance. The Company utilizes several measures and metrics to evaluate
its performance, as further described in "Performance Measures and Metrics" below, and in turn, the Compensation Committee utilizes similar measures in evaluating executive officer compensation.
The Compensation Committee believes that the elements of compensation for the Company's senior executives reward intrinsically sound management decisions and do not encourage risk
taking to enhance short-term profitability at the expense of the long-term health and viability of the enterprise. While the design of our executive compensation program is primarily performance-based, we do not believe that it encourages excessive
risk-taking. The Committee believes that the Company's senior executives have taken a prudent approach to corporate risk management. In addition, the Company has in place a risk management program designed to identify, evaluate and control risks.
Through this program, we take a company-wide view of risks and have a network of systems and oversight to ensure that risks are not viewed in isolation and are appropriately controlled and reported, including a system of reporting to the full Board and
its Committees. We believe that our compensation programs work within this system.
In response to current trends in executive compensation practices, as well as SEC rules encouraging more explicit focus on risks arising from compensation policies, Vishay has
commenced a practice of more deliberately focusing on the risks, if any, arising from its executive compensation arrangements, and modifying such arrangements to the extent necessary to minimize any such risks.
The factors considered by the Compensation Committee in evaluating the risks arising from compensation arrangements, which have been incorporated into the terms and conditions of such
compensation arrangements, include, in no particular weighting or order of prominence:
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•
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Minimum base salary levels are fixed in amount;
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| |
|
| • |
While annual cash bonuses focus on the achievement of short-term or annual goals, and short-term goals may encourage risk-taking, annual cash bonuses for Executive Officers are capped in order to balance the risk;
and
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|
•
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A significant portion of our RSUs carry performance conditions which are tied to operating results over a three-year period. |
Furthermore, with respect to Mr. Zandman and Dr. Paul:
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•
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a meaningful portion of compensation is deferred until retirement or termination of employment under our non-qualified deferred compensation plan; and
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•
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phantom stock units are only settled upon retirement or termination of employment, thus providing an incentive for the creation of long-term stockholder value.
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Each of these factors is intended to encourage an appropriate long-term focus, and to align the long-term interests of senior management with those of our stockholders.
Executive Stock
Ownership Guidelines
To further align the interests of the Company's executives with its stockholders, the Board adopted stock ownership guidelines in 2021 (the "Executive Stock Ownership Guidelines")
applicable to the Company's executive vice presidents (the "Covered Executives"), which provide:
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•
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Each Covered Executive is required to own shares of the Company's common stock having an aggregate fair market value equal to or greater than one (1) time the Covered Executive's base salary as of the
Measurement Date (market close on the first trading day in March of each calendar year); and
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•
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Individuals that are Covered Executives as of the date the Executive Stock Ownership Guidelines were adopted will have until the first trading day in March of 2026 to attain the specified level of equity
ownership. Any individual who becomes a Covered Executive later will have until the first Measurement Date that occurs at least five years from the date he or she became a Covered Executive to attain the specified level of equity ownership.
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| • |
Following the 5-year phase-in period, Covered Executives who do not meet the required ownership threshold will be generally prohibited from
selling stock acquired through equity awards.
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| |
|
| • |
The following will be considered "owned" for the purposes of the Executive Stock Ownership Guidelines:
|
| |
• |
all shares underlying time-based equity awards, whether or not vested
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• |
only vested shares underlying performance-based equity awards
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• |
shares held outright or beneficially owned by the Covered Executive, his or her spouse and minor children, or a trust for the benefit of these
individuals
|
The Board of Directors
amended and restated the Executive Stock Ownership Guidelines, effective January 1, 2023. Under the updated guidelines, the Chief Executive Officer will be required to own shares of the Company's common stock having an aggregate fair market value
equal to or greater than three (3) times his base salary as of the Measurement Date. In addition, an executive promoted into a role with a higher level of required stock ownership will have until the first Measurement Date that occurs at least five
years after such promotion to achieve the requisite level of stock ownership.
Executive Officer Employment Agreements
Each Executive Officer is party to an employment agreement with us. During 2022, the employment agreements in effect for Mr. Zandman, and (prior to his retirement) Dr. Paul, reflected each Executive Officer's
long-standing tenure with the Company. These agreements were initially entered into in 2004, and although they have been amended from time-to-time since 2004, the basic framework has remained in place.
The employment agreements for the remainder of our Executive Officers were entered into in 2018 or after, and in many cases have been amended from time-to-time. These agreements are generally similar in form and
substance, with variations based on respective roles and responsibilities, locations of residence and tenures with the Company.
Departing Executive Officer Transition Agreements
As part of the executive transition plan, it was determined in
mid-2022 that the employment of Messrs. Vandoorn, Tse, and Valletta would be terminated without cause effective December 31, 2022. Each departing executive continued to perform services, including assisting with the transition of their
responsibilities, through December 31, 2022, and continued to be compensated in accordance with existing arrangements through that time. The Compensation Committee approved “Transition Agreements” with each of Messrs. Vandoorn, Tse, and Valletta
that established the responsibilities of each departing executive during the transition period, and confirmed the severance benefits to which each would be entitled. Such severance benefits were consistent with those described in each
executive’s pre-existing employment agreement. The severance benefits were conditioned upon the executive signing a release of claims and complying with such executive's pre-existing restrictive covenants.
Role of the Compensation Consultant
The Compensation Committee reviews the total compensation level of our
Executive Officers each year, considering individual performance, prior years' compensation level, recent operating results, operating results of competitors, projections for the future, other components of the executive pay packages, perceived
trends in executive compensation levels and design among the peer group of Vishay and the broader market, and input on executive performance from the Chief Executive Officer. The determination is subjective and the Compensation Committee does not
assign any quantitative weight to these factors.
Beginning in 2019, the Compensation Committee engaged Aon Radford to
advise it regarding executive compensation. The Compensation Committee assessed the independence of Aon Radford based on NYSE Listing Standards and SEC rules and concluded that its work does not raise any conflict of interest.
In the course of its engagement, Aon Radford developed, and the
Compensation Committee approved, a custom peer group of public companies that were substantially similar to Vishay in terms of industry, revenues, and scope of international operations. The 2022 peer group consisted of the following companies:
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Advanced Energy Industries, Inc.
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Itron, Inc.
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| • |
Amkor Technology, Inc.
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• |
Juniper Networks, Inc. |
| • |
Belden Inc.
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Littelfuse,
Inc. |
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CommScope Holding Company, Inc.
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•
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MKS Instruments, Inc.
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•
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Diodes Incorporated
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Sensata Technologies Holding plc
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•
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Fabrinet
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•
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Silicon Laboratories Inc.
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•
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First Solar, Inc.
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•
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SunPower Corporation
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•
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Hubbell Incorporated
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•
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TTM Technologies, Inc.
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| • |
II-VI Incorporated
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Ultra Clean Holdings, Inc.
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| • |
IPG Photonics Corporation
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• |
Viasat, Inc.
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Based on data derived from peer group companies’ filings, Aon Radford presented studies to the Compensation Committee that assessed the competitiveness of our executive compensation practices, structures, pay mix
and pay levels. The study indicated that we are generally at the market median with respect to total direct compensation payable to our executive officers, even though our allocation between various compensation elements diverges from our peers.
The Compensation Committee considered this study as one of several factors, along with individual performance, contractual entitlements, and past pay practices, in setting the compensation packages for our executive officers.
Performance Measures and Metrics
Like its peers in the electronics industry, the Company has historically gauged its overall performance in accordance with what it terms "adjusted net earnings." The Company uses
this term to mean net earnings determined in accordance with U.S. generally accepted accounting principles ("GAAP") adjusted for various items that management believes are not indicative of the intrinsic operating performance of the Company's business,
as detailed below. Non-GAAP measures such as "adjusted net earnings" do not have uniform definitions and may not be comparable to similarly titled measures used by other companies. Reconciling items to arrive at adjusted net earnings represent
significant charges or credits that are important to understanding our intrinsic operations. The bonuses for the Executive Officers under the Company's cash bonus plans discussed below, including the Vishay Intertechnology Section 162(m) Cash Bonus
Plan, were based primarily on this performance metric. Adjusted net earnings and/or adjusted earnings per share, for a multi-year period, are also used in connection with performance-based RSUs for all Executive Officers.
Adjusted net earnings for the years ended December 31, 2022, 2021 and 2020 were as follows (in thousands, except per share amounts):
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YEARS ENDED DECEMBER 31,
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2022
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2021
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2020
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GAAP net earnings attributable to Vishay stockholders
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$
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428,810
|
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$
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297,970
|
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$
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122,923
|
|
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|
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|
|
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Reconciling items affecting gross profit
|
|
|
|
|
|
|
|
|
|
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Impact of COVID-19 pandemic
|
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$ |
6,661
|
|
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$
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- |
|
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$
|
4,563 |
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| |
|
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Reconciling items affecting operating income:
|
|
|
|
|
|
|
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Impact of COVID-19 pandemic
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$
|
546
|
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|
$
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- |
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|
$
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(1,451 |
)
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Restructuring and severance costs
|
|
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- |
|
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-
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743
|
|
|
|
|
|
|
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|
|
|
|
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Reconciling items affecting other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
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Loss on early extinguishment of debt
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|
$
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- |
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|
$ |
- |
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|
$ |
8,073 |
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|
|
|
|
|
|
|
|
|
|
|
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Reconciling items affecting tax expense (benefit):
|
|
|
|
|
|
|
|
|
|
|
|
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Effects of changes in uncertain tax positions
|
|
$
|
(5,941
|
)
|
|
$
|
-
|
|
|
$
|
3,751
|
|
| Effects of changes in valuation allowances |
|
|
(33,669
|
)
|
|
|
(5,714 |
)
|
|
|
-
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|
Effects of change in indefinite reversal assertion
|
|
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59,642
|
|
|
|
-
|
|
|
|
-
|
|
| Changes in new tax laws and regulations |
|
|
- |
|
|
|
45,040 |
|
|
|
-
|
|
Changes in deferred taxes due to early extinguishment of debt
|
|
|
- |
|
|
|
- |
|
|
|
(1,563 |
)
|
Effects of cash repatriation program
|
|
|
- |
|
|
|
- |
|
|
|
(190 |
)
|
|
Tax effects of pre-tax items above
|
|
|
(1,802 |
)
|
|
|
-
|
|
|
|
(2,799
|
)
|
|
Adjusted net earnings
|
|
$
|
454,247
|
|
|
$
|
337,296
|
|
|
$
|
134,050
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted weighted average diluted shares outstanding
|
|
|
143,915
|
|
|
|
145,495
|
|
|
|
145,228
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted earnings per diluted share
|
|
$
|
3.16
|
|
|
$
|
2.32
|
|
|
$
|
0.92
|
|
The Company also measures its overall performance based on "free cash." The Company uses this term to mean the cash flows generated from continuing operations less capital
expenditures plus net proceeds from the sale of assets. This metric is a component of the incentive compensation structures for Ms. Lipcaman and Messrs. Vandoorn, Valletta, Smejkal, and Randebrock. This same metric, for a multi-year period, is also
used in connection with performance-based RSUs granted for all Executive Officers. Although the term "free cash" is not defined in GAAP, each of the elements used to calculate "free cash" is presented as a line item on the face of our consolidated
statement of cash flows prepared in accordance with GAAP as follows (in thousands):
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|
|
YEARS ENDED DECEMBER 31,
|
|
|
|
|
2022
|
|
|
2021
|
|
|
2020
|
|
|
Net cash provided by operating activities
|
|
$
|
484,288
|
|
|
$
|
457,104
|
|
|
$
|
314,938
|
|
|
Proceeds from sale of property and equipment
|
|
|
1,198
|
|
|
|
1,317
|
|
|
|
403
|
|
|
Less: Capital expenditures
|
|
|
(325,308 |
)
|
|
|
(218,372
|
)
|
|
|
(123,599
|
)
|
|
Free cash
|
|
$
|
160,178 |
|
|
$
|
240,049
|
|
|
$
|
191,742
|
|
At the grant date, the Compensation Committee may provide for certain pre-defined adjustments to this metric. For the performance-based RSUs, the free cash target measure was
adjusted by adding the total cash paid pursuant to restructuring programs.
The 2022 incentive compensation structures for Ms. Lipcaman and Messrs. Vandoorn, Valletta, Smejkal, and Tse were tailored to their specific responsibilities. The following measures
and metrics were utilized in determining the incentive compensation payable to these Executive Officers for 2022:
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•
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adjusted net earnings;
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|
•
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third party net sales;
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•
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variable margin;
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•
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gross profit margin;
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|
•
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free cash;
|
|
•
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segment operating income; and |
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•
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divisional cash flow. |
Third party net sales is an amount determined in accordance with GAAP which is reported in our consolidated financial statements, included in our annual report on Form 10-K for the
year ended December 31, 2022.
Variable margin is a cost accounting metric which represents third party net sales less manufacturing costs which vary in a direct relationship with volume (in other words, excluding
fixed manufacturing costs such as depreciation and overhead).
Gross profit margin is computed as gross profit as a percentage of net revenues. Gross profit is generally net revenues less costs of products sold, but also deducts certain other
period costs, particularly losses on purchase commitments and inventory write-downs. Gross profit margin is clearly a function of net revenues, but also reflects our cost management programs and our ability to contain fixed costs.
Segment operating income is computed as operating income less such selling, general, and administrative costs as global operations, sales and marketing, information systems, finance
and administration groups, as well as restructuring and severance costs, the direct impact of the COVID-19 pandemic, and other items affecting comparability.
Divisional cash flow is generally computed as the segment operating income plus depreciation and less capital expenditures. Adjustments are also made for certain non-cash items such
as foreign currency effects.
Compensation Components
The discussion that follows in this section addresses the executive compensation packages in effect in 2022.
The components of 2022 compensation for our Executive Officers were consistent with their employment agreements and consisted of:
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SHORT TERM
|
|
MEDIUM TERM
|
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LONG TERM
|
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•
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Base salary
|
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•
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Equity-based compensation
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•
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Retirement benefits
|
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•
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Cash performance-based incentive compensation
|
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•
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Contributions to the Company's deferred compensation plan*
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•
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Perquisites and other personal benefits
|
|
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|
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|
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| * |
For Dr. Paul, Mr. Zandman, and Mr. Valletta |
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The compensation packages for Mr. Zandman and, prior to his retirement, Dr. Paul, were reflective of their positions and tenure as Executive Officers of the Company. As such, these
agreements include compensation components other than base salary, cash performance-based incentive compensation, and equity-based compensation, which are not available to all our other Executive Officers. These other components include certain
deferred compensation, entitlements, certain additional severance benefits, annual grants of phantom stock units, and certain additional welfare and retirement benefits.
Base Salary
The minimum base salary levels for the Executive Officers are fixed in their respective employment agreements. The Compensation Committee determined the minimum base salaries, based
upon the executives' salary level, present responsibilities, expectations with respect to future responsibilities and a comparison to peer group executive salaries. The Compensation Committee selected the group of peer group companies on the advice of
its compensation consultant. Compensation practices in the peer group were only one of the factors considered by the Compensation Committee. The base salaries of the Executive Officers are denominated in the individual's local currency. A portion of
the change in the salaries for these Executive Officers expressed in terms of U.S. dollars reflects the fluctuations of the dollar against the currencies of the home jurisdiction of these executives.
The approved base salaries for 2022 are set forth below:
|
NAME
|
|
2022 BASE SALARY(1)
|
|
Marc Zandman
|
|
ILS 4,096,583 (approximately $1,220,000)(2)
|
|
Dr. Gerald Paul
|
|
€1,135,850 (approximately $1,194,000)(3)
|
|
Lori Lipcaman
|
|
€475,555 (approximately $500,000)(3)
|
|
Johan Vandoorn
|
|
€534,091 (approximately $561,000)(3)
|
|
David Valletta
|
|
$582,332
|
Joel Smejkal
|
|
$596,190
|
| Clarence Tse |
|
TWD 20,019,720 (approximately $672,000)(4) |
Jeff Webster
|
|
ILS 1,689,857 (approximately $503,000)(2) |
Andreas Randebrock
|
|
€344,801 (approximately $362,000)(3) |
(1)
|
The amounts shown have been converted into U.S. dollars at the weighted average exchange rate for 2022. |
|
(2)
|
Paid in Israeli shekels.
|
|
(3)
|
Paid in euro.
|
|
(4)
|
Paid in Taiwan dollars.
|
Incentive compensation
The Company maintains a cash bonus plan, the Vishay Intertechnology Section 162(m) Cash Bonus Plan (the "Cash Bonus Plan").
The incentive compensation under the Cash Bonus Plan provides an annual cash bonus as a percentage of our "adjusted net earnings," as described below. Over many years, we have viewed
adjusted net earnings as the primary indicator of the performance of our executive management team. As more specifically addressed below, adjusted net earnings refers to net earnings determined in accordance with GAAP, adjusted to eliminate the after
tax effects of items, positive or negative, that do not relate to our intrinsic operations. These items include, among others, goodwill and long-lived asset impairment charges, severance and restructuring costs, special tax items, and other items,
such as unusual gains or losses that impact GAAP net earnings, not reflecting on-going operating activities. The calculation of adjusted net earnings is set forth in our annual report on Form 10-K as well as under the heading "Performance Measures and
Metrics" in this proxy statement. We utilize this measure in part because it eliminates factors that mask the actual performance of on-going operations and because of its currency with other public companies in our industry. Accordingly, the
Compensation Committee determined that the incentive compensation of Dr. Paul and Mr. Zandman should be primarily in the form of a percentage of adjusted net earnings, with a cap (three times salary) to avoid compensation that in fact or in appearance
might be deemed excessive. There is no minimum adjusted net earnings threshold, and accordingly, the bonuses for Dr. Paul and Mr. Zandman begin to accrue with the first dollar of adjusted net earnings.
Dr. Paul's bonus is equal to 1.25% of adjusted net earnings. Mr. Zandman's bonus is equal to 1.0% of adjusted net earnings.
Under their respective employment agreements, the remaining 2022 Executive Officers are each eligible to receive a performance bonus, based on the Company's overall and their
individual performances. They each have a maximum annual bonus opportunity of 100% of their respective base salaries. One element of the annual bonuses for Executive Officers, other than Dr. Paul and Mr. Zandman, is a straight percentage of adjusted
net earnings pursuant to the Cash Bonus Plan, and other elements of such bonuses are expressed as a percentage of base salary, measured against specific performance goals. Performance goals for purposes of the annual bonus award are recommended by the
Chief Executive Officer and approved by the Compensation Committee. The portions of such bonuses that are a straight percentage of adjusted net earnings for these Executive Officers are included in the Cash Bonus Plan.
The bonuses earned for each Executive Officer in 2022 under the Cash Bonus Plan were as follows:
|
NAME
|
|
PERCENTAGE OF ADJUSTED NET EARNINGS |
|
DOLLAR VALUE ($)
|
|
Marc Zandman
|
|
1.00% |
|
4,542,470
|
(1)
|
|
Dr. Gerald Paul
|
|
1.25% |
|
5,678,088
|
(1) |
| Lori Lipcaman |
|
0.15% |
|
681,371 |
(1) |
|
Johan Vandoorn
|
|
0.10% |
|
454,247
|
(1)
|
|
David Valletta
|
|
0.07% |
|
317,973
|
|
Joel Smejkal
|
|
0.07%
|
|
317,973 |
|
|
Clarence Tse
|
|
0.07% |
|
317,973
|
|
|
Jeff Webster
|
|
0.07%
|
|
317,973 |
(1)
|
|
Andreas Randebrock
|
|
0.05% |
|
227,124 |
|
| |
|
|
|
|
|
(1) Amount paid limited by the cap set by the Compensation
Committee.
|
|
The performance of the Executive Officers other than Mr. Zandman and Dr. Paul is reviewed by the Chief Executive Officer and the Compensation Committee following the end of the year,
and each executive is assigned a performance score for several categories. For a discussion of 2022 goals and achieved results for the other Executive Officers, see "Evaluation of Achievements for Cash Performance-Based Incentive Compensation."
Equity-Based Compensation
The 2007 Program permits the grant of up to 6,500,000 shares of restricted stock, unrestricted stock, restricted stock units, stock options, and phantom stock units to officers,
employees, and non-employee directors.
All outstanding equity-based compensation were issued from the 2007 Program. The 2007 Program, as amended and restated, was approved at the 2014 Annual Meeting of Stockholders.
The Compensation Committee believes that the grant of equity awards is the primary tool for aligning interests of the executive officers with the long-term interests of the
Company's stockholders. Accordingly, the Compensation Committee includes a long-term incentive ("LTI") component in the form of equity-based compensation in each of the executives' employment agreements.
In establishing the amount of equity awards, the Compensation Committee utilized the market-competitive range of equity awards granted to similarly situated executive officers of
the peer group companies. The Compensation Committee concluded that a grant of equity awards within such market-competitive range was appropriate to reward and incentivize our Executive Officers.
The employment agreements of the Executive Officers provide for annual grants of equity based compensation. For 2022, the grants were sized based upon a
percentage of base salary, as of the date of grant, as follows:
|
NAME
|
|
LTI VALUE
|
|
Marc Zandman
|
|
125% of base salary
|
|
Dr. Gerald Paul
|
|
150% of base salary
|
|
Lori Lipcaman
|
|
70% of base salary
|
|
Johan Vandoorn
|
|
50% of base salary
|
|
David Valletta
|
|
50% of base salary
|
Joel Smejkal
|
|
50% of base salary
|
| Clarence Tse |
|
40% of base salary |
Jeff Webster
|
|
40% of base salary
|
Andreas Randebrock
|
|
40% of base salary
|
| |
|
|
The number of RSUs granted was determined by multiplying the executive's base salary for 2022 by the respective percentage set forth above and dividing by the closing price of the
common stock on the New York Stock Exchange ("NYSE") on the last trading day in 2021. The time-vested RSUs carry only a service condition and vest on January 1 of the third year following the grant. The PBRSUs include performance conditions agreed to
with the Compensation Committee in its role as administrator of the 2007 Program (based on adjusted net earnings, adjusted earnings per share, and/or free cash over a three year period). Performance-based targets related to the PBRSUs are set at
levels intended to be attainable without the need to take inappropriate risks. The PBRSUs contain a three-year service period and are subject to the Compensation Committee certifying that all performance criteria have been satisfied. Fifty percent of
the PBRSUs will vest if 70% of the applicable objective is met, and the proportion of PBRSUs subject to such criterion will increase ratably (between 70% and 100% achievement).
In 2022, the Compensation Committee awarded the following RSUs (including PBRSUs) to our executive officers:
|
NAME
|
|
TIME-VESTED RSUs
|
|
|
PBRSUs
|
|
|
TOTAL
|
|
|
Marc Zandman
|
|
|
18,117
|
|
|
|
54,353
|
|
|
|
72,470
|
|
|
Dr. Gerald Paul
|
|
|
23,038
|
|
|
|
69,113
|
|
|
|
92,151
|
|
|
Lori Lipcaman
|
|
|
9,002
|
|
|
|
9,003
|
|
|
|
18,005
|
|
|
Johan Vandoorn
|
|
|
7,222
|
|
|
|
7,222
|
|
|
|
14,444
|
|
|
David Valletta
|
|
|
6,656
|
|
|
|
6,657
|
|
|
|
13,313
|
|
Joel Smejkal
|
|
|
6,815
|
|
|
|
6,815
|
|
|
|
13,630
|
|
| Clarence Tse |
|
|
6,531
|
|
|
|
6,531
|
|
|
|
13,062
|
|
Jeff Webster
|
|
|
4,783
|
|
|
|
4,783
|
|
|
|
9,566
|
|
Andreas Randebrock
|
|
|
3,730
|
|
|
|
3,730
|
|
|
|
7,460
|
|
With respect to our Executive Officers, time-based vesting conditions will be deemed satisfied, and performance-based vesting conditions will remain in effect, upon the executive's
death, disability, termination without cause, resignation with "good reason;" or resignation for any reason following the attainment of age 62 (except where cause exists). In the event of voluntary termination by the executive before age 62 (without
"good reason") or termination for cause, the executive's outstanding RSUs (including PBRSUs) will be forfeited. For financial accounting purposes, the grant-date fair value is determined on the date that the Compensation Committee approves the number
of RSUs to be granted under this provision. Accordingly, the value of the grant shown in the Summary Compensation Table will be different than the LTI value described in the table above.
The PBRSU awards granted in 2019 and 2020 fully vested in 2022 and 2023, respectively. The performance measure for both years was based on the aggregate adjusted net earnings and free cash flow for the three year
period. The calculation of adjusted net earnings and free cash flow is described under the heading “Performance Measures and Metrics”. For the 2019-2021 period (vesting in 2022) the target was $750 million. For the 2020-2022 period (vesting in
2023), the target was $850 million. The actual achievement for the 2019-2021 period was 167% of the performance target, and the actual achievement for the 2020-2022 period was 193% of the performance target, in each case resulting in payout of 100%
of the PBRSUs for the applicable year.
Phantom stock units
A phantom stock unit is the right to receive a share of common stock upon termination of employment. Pursuant to their employment agreements, Dr. Paul and Mr.
Zandman receive annual grants of 5,000 phantom stock units during their tenure with the Company. The grants are made under the 2007 Program.
While the phantom stock units remain outstanding, Dr. Paul and Mr. Zandman receive dividend equivalents in the form of additional phantom stock units each time the
Company pays a dividend on its common stock.
Similar to the deferred cash compensation described below, the Compensation Committee considers the grant of phantom stock units in the nature of a retirement
benefit and is intended to strengthen the alignment of executive and stockholder interests in the long-term appreciation of Vishay's equity value.
No other Executive Officer currently receives phantom stock units.
The Compensation Committee also considers the award of extra-contractual equity-based compensation, when appropriate. However, no such additional equity awards
were granted to any Executive Officer in 2022.
Deferred compensation
Executives are eligible to participate in a non-qualified deferred compensation plan, which is available to all employees who meet certain criteria under the Internal Revenue Code. Vishay annually contributes $100,000
for each of Dr. Paul (prior to his retirement) and Mr. Zandman, pursuant to their respective employment agreements. During his employment, Mr. Valletta was eligible for contributions pursuant to the deferred compensation plan, similar to all eligible
plan participants who formerly participated in the frozen Vishay Non-qualified Retirement Plan. Mr. Webster has a vested balance in the U.S. deferred compensation plan. The remaining Executive Officers do not participate in the deferred compensation
plan.
All amounts contributed to these plans prior to January 1, 2005, were deemed deferred until retirement or termination of employment. Amounts contributed by employees after January 1, 2005, may have shorter deferral
periods if so elected by the executive. Amounts contributed by the Company after January 1, 2005, are generally deferred until retirement or termination of employment. To the extent required to avoid tax penalties, the deferred amounts are not paid
until six months after the termination of employment.
While deferred, amounts are credited with "earnings" based on the performance of notional investment options available under the plan. No portion of the earnings credited during 2022 was "above market" or
"preferential."
In addition, in 2022 Mr. Zandman participated in an elective deferred compensation arrangement, established by Vishay Israel Ltd. Under these arrangements, an executive who elects to participate may defer payment of a
percentage of the executive's salary, annual bonus and certain other benefits. During the executive’s continued
service, amounts deferred under an arrangement will be deemed invested in investment funds selected by the executive from a list made available by Vishay Israel. Payment of the deferred amounts (as adjusted for notional earnings and losses) will be
made in a lump sum upon the executive’s death, disability or other cessation of service (subject to a six month delay, if required by applicable law). These payments will be made from the general assets of Vishay Israel, which may include insurance
policies purchased by Vishay Israel to anticipate its liabilities under these arrangements. In addition, the Company has guaranteed Vishay Israel's obligations under these arrangements.
Retirement benefits
The Compensation Committee believes that providing adequate postretirement benefits commensurate with position is essential to retaining qualified individuals for long-term
employment. Vishay maintains pension and retirement programs for, or makes certain government retirement programs available to, most of its employees around the world, including its Executive Officers. The retirement benefits for Executive Officers
pursuant to these programs are not materially preferential to those of other employees in those respective countries.
As part of the amendments to the employment agreements for Dr. Paul and Mr. Zandman in 2010, the Compensation Committee determined to extend the severance benefits for these
executives to also include any termination (other than for cause) after age 62. This provision was added in light of the long-standing tenure of these executives and to ensure a smooth transition upon their retirement.
Employee Benefits
The Executive Officers, together with their respective spouses and
dependent children up to age 26, generally are entitled to participate in any and all medical insurance, group health insurance, disability insurance, life insurance and retirement plans which are generally made available to other employees of the
respective subsidiary of Vishay which employs them, subject to the eligibility requirements and other provisions of such plans and programs.
The employment agreements with Mr. Zandman and Dr. Paul also include
supplemental post-employment medical benefits, specific life insurance benefits, and supplemental disability benefits.
The specific life insurance benefit for Mr. Zandman and Dr. Paul provides
their respective beneficiaries a death benefit equal to three times base salary while employed, and one time final base salary following retirement. While their respective employment agreements historically contemplated that these benefits would be
provided through third-party insurance providers, the Company has decided to self-insure these obligations.
The supplemental disability benefits for Mr. Zandman and Dr. Paul provide
them with a disability benefit equal to 60% of their respective base salary and average annual bonus at the time of disability. While their respective employment agreements historically contemplated that these benefits would be provided through
third-party insurance providers, the Company has decided to self-insure these obligations.
Dr. Paul's employment agreement provides for lifetime continuation of his medical benefit up to an annual premium value of $15,000. Mr. Zandman's employment agreement provides Company-sponsored medical coverage
(before and after his retirement) which includes his dependents (regardless of age), as well as their future spouses and children, up to an annual insurance premium cap of $50,000. If the health insurance premiums in respect of Mr. Zandman, his
spouse, and his dependent children under age 26 (the formerly covered group) increase in future years, the annual health insurance premium cap will be increased accordingly, but there will be no increase in the cap if the premiums in respect of his
children age 26 and over and their spouses and children increase. In addition, the Company will reimburse Mr. Zandman for out-of-pocket expenses and co-payments incurred by the covered group.
Perquisites
We provide executive officers with perquisites and other personal benefits that Vishay and the Compensation Committee believe are reasonable and consistent with our overall
compensation program. These perquisites are not intended, however, to constitute a material portion of the executive's compensation package. In general, the perquisites, while not integral to the performance of an executive's duties, must bear some
relationship to the executive's employment and be of perceived benefit to Vishay. The Compensation Committee periodically reviews the levels of perquisites and other personal benefits provided to Executive Officers.
Severance
The Compensation Committee believes that severance payments in the event of an involuntary termination of employment are part of a standard compensation package for senior executives. The terms of these severance
provisions are discussed in "Potential Payments Upon Termination or a Change in Control."
Special Bonuses
In certain situations, the Board of Directors will award special, one-time bonuses. No special bonuses were awarded in 2022.
Evaluation of Achievements for Cash Performance-Based Incentive
Compensation
The following sections describe the incentive compensation structure and achievements for 2022 for Ms. Lipcaman, and Messrs. Vandoorn, Valletta, Smejkal, Tse,
Webster, and Randebrock (each element is expressed as a percentage of base salary at target and at maximum).
Ms. Lipcaman
For 2022 Ms. Lipcaman's incentive compensation was comprised of one element equal to 0.15% of adjusted net earnings and other elements expressed as a percentage of base salary,
measured against performance goals. These other elements were structured as follows:
|
CATEGORY
|
|
TARGET(1)
|
|
MAXIMUM
|
|
RELATIVE ACHIEVEMENT VS. BUDGET/EXPECTATION
|
|
ACHIEVEMENT (AS A PERCENTAGE OF BASE SALARY)
|
|
Free cash(2)
|
|
12.5%
|
|
12.5%
|
|
>100%
|
|
12.5%
|
|
Fixed costs(3)
|
|
7.5%
|
|
7.5%
|
|
>100%
|
|
7.5%
|
|
Personal objectives(4)
|
|
10.0%
|
|
10.0%
|
|
67.5%
|
|
6.8%
|
|
Total
|
|
30.0%
|
|
30.0%
|
|
|
|
26.8%
|
|
(1)
|
The percentage at "Target" in this table represents the bonus payable at achievement of 100% of budget / expectation.
|
| |
|
(2)
|
Ms. Lipcaman would not be eligible to receive a bonus if actual free cash was under $100 million. If actual free cash were between $100 million and budget, the
applicable bonus increases ratably from 0% to 12.5% of base salary. |
| |
|
(3)
|
For achievement of 97% to 100% of budgeted fixed costs under responsibility, the applicable bonus increases ratably from 3.75% to 7.5% of base salary.
|
| |
|
|
(4)
|
Ms. Lipcaman's individual performance goals for 2022 (with related bonus opportunity as a percentage of base salary in parentheses) included: implementing the Stockholder Return Policy (2.5%); developing materials for an advanced
business finance seminar for non-financial management (2.0%); sponsoring a finance roundtable (1.5%); and serving as executive sponsor for certain specific finance-related IT projects (4.0%). The achievement of these goals was evaluated
and measured in the aggregate.
Ms. Lipcaman’s incentive compensation (including the portion payable under the Cash
Bonus Plan) for 2022 was limited by a cap equal to one-times her base salary. This cap was set by the Compensation Committee and included in her employment agreement as in effect for 2022.
|
Mr. Vandoorn
For 2022, Mr. Vandoorn's incentive compensation was comprised of one element equal to 0.1% of adjusted net earnings and other elements expressed as a percentage of base salary,
measured against performance goals. These other elements were structured as follows:
|
CATEGORY
|
|
TARGET(1)
|
|
MAXIMUM
|
|
RELATIVE ACHIEVEMENT VS. BUDGET/EXPECTATION
|
|
ACHIEVEMENT (AS A PERCENTAGE OF BASE SALARY)
|
|
Variable margin of defined R&D projects(2)
|
|
15.0%
|
|
15.0%
|
|
>100%
|
|
10.0%
|
|
Third party net sales of defined R&D projects(3)
|
|
10.0%
|
|
10.0%
|
|
>100%
|
|
10.0%
|
| Free cash(4) |
|
10.0%
|
|
10.0% |
|
>100% |
|
15.0% |
| Fixed costs(5) |
|
5.0% |
|
5.0%
|
|
>100%
|
|
5.0% |
|
Personal objectives(6)
|
|
10.0%
|
|
10.0%
|
|
90.0%
|
|
9.0%
|
|
Total
|
|
50.0%
|
|
50.0%
|
|
|
|
49.0%
|
|
(1)
|
The percentage at "Target" in this table represents the bonus payable at achievement of 100% of budget / expectation.
|
| |
|
(2)
|
For achievement of 0% to 100% of budget, the applicable bonus increases ratably from 0% to 15% of base salary. |
| |
|
(3)
|
For achievement of 0% to 100% of sales of new products related to defined projects, the applicable bonus increases ratably from 0% to 10% of
base salary. |
| |
|
(4)
|
Mr. Vandoorn would not be eligible to receive a bonus if actual free cash was under $100 million. If actual free cash were between $100 million
and budget, the applicable bonus increases ratably from 0% to 10% of base salary. |
| |
|
(5)
|
For achievement of 97% to 100% of budgeted fixed costs under responsibility, the applicable bonus increases ratably from 2.5% to 5% of base
salary. |
| |
|
|
(6)
|
Mr. Vandoorn's individual performance goals for 2022 (with related bonus opportunity as a percentage of base salary in parentheses) included: meeting R&D milestones (2.0%); defining new
innovation targets to achieve sales target (1.5%); fostering acquisition plans (1.5%); completing certain strategic projects (4.0%); and supporting investor relations (1.0%). The achievement of these goals was evaluated and
measured in the aggregate.
Mr. Vandoorn’s incentive compensation (including the
portion payable under the Cash Bonus Plan) for 2022 was limited by a cap equal to one-times his base salary. This cap was set by the Compensation Committee and included in his employment agreement as in effect for 2022.
|
Mr. Valletta
For 2022, Mr. Valletta's incentive compensation was comprised of one element equal to 0.07% of adjusted net earnings and other elements expressed as a percentage of base salary,
measured against performance goals. These other elements were structured as follows:
|
CATEGORY
|
|
TARGET(1)
|
|
MAXIMUM
|
|
RELATIVE ACHIEVEMENT VS. BUDGET/EXPECTATION
|
|
ACHIEVEMENT (AS A PERCENTAGE OF BASE SALARY)
|
|
Third party net sales(2)
|
|
5.0%
|
|
15.0%
|
|
110.2%
|
|
10.1% |
|
Standard variable margin on actual sales(2)(3)
|
|
12.5%
|
|
12.5%
|
|
>100%
|
|
12.5% |
| Free cash(4) |
|
10.0% |
|
10.0% |
|
>100% |
|
10.0% |
| Fixed costs(5) |
|
5.0% |
|
5.0% |
|
>100% |
|
5.0% |
|
Personal objectives(6)
|
|
7.5%
|
|
7.5%
|
|
80.0%
|
|
6.0%
|
|
Total
|
|
40.0%
|
|
50.0%
|
|
|
|
43.6%
|
|
(1)
|
The percentage at "Target" in this table represents the bonus payable at achievement of 100% of budget / expectation.
|
| |
|
(2)
|
Mr. Valletta would not be eligible to receive a bonus if actual performance were less than 90% of budget. If actual third party net sales were between 90% and 100% of budget, applicable bonus increases ratably from 0% to 5% of base salary.
If actual third party net sales were between 100% and 120% of budget, the applicable bonus increases ratably from 5% to 15% of base salary.
|
| |
|
(3)
|
For actual achievement within 2% of budgeted standard variable margin, the applicable bonus increases ratably from 0% to 12.5% of base salary. |
| |
|
(4)
|
Mr. Valletta would not be eligible to receive a bonus if actual free cash was under $100 million. If actual free cash were between $100 million
and budget, the applicable bonus increases ratably from 0% to 10% of base salary. |
| |
|
(5)
|
For achievement of 97% to 100% of budgeted fixed costs under responsibility, the applicable bonus increases ratably from 2.5% to 5% of base
salary. |
| |
|
|
(6)
|
Mr. Valletta's individual performance goals for 2022 (with related bonus opportunity as a percentage of base salary in parentheses) included: overseeing certain strategic operations projects (4.5%); integrating acquired businesses
(1.0%); achieving accounts receivable aging targets (1.0%); and maintaining consignment inventories at specific inventory turnover targets (1.0%). The achievement of these goals was evaluated and measured in the aggregate.
|
Mr. Smejkal
For 2022, Mr. Smejkal's incentive compensation was comprised of one element equal to 0.07% of adjusted net earnings and
other elements expressed as a percentage of base salary, measured against performance goals. These other elements were structured as follows:
|
CATEGORY
|
|
TARGET(1)
|
|
MAXIMUM
|
|
RELATIVE ACHIEVEMENT VS. BUDGET/EXPECTATION
|
|
ACHIEVEMENT (AS A PERCENTAGE OF BASE SALARY)
|
|
Third party net sales(2)
|
|
3.3%
|
|
10.0%
|
|
110.2%
|
|
6.7%
|
|
Standard variable margin on actual sales(2)(3)
|
|
5.0%
|
|
5.0%
|
|
>100% |
|
5.0%
|
| Free cash(4) |
|
10.0% |
|
10.0% |
|
>100%
|
|
10.0%
|
| Sales above budget(5) |
|
0.0%
|
|
10.0% |
|
>110%
|
|
10.0% |
|
Personal objectives(6)
|
|
15.0%
|
|
15.0%
|
|
96.7%
|
|
14.5%
|
|
Total
|
|
33.3%
|
|
50.0%
|
|
|
|
46.2%
|
|
(1)
|
The percentage at "Target" in this table represents the bonus payable at achievement of 100% of budget / expectation.
|
| |
|
| (2) |
Mr. Smejkal would not be eligible to receive a bonus if actual performance were less than 90% of budget. If actual third party net sales were between 90% and 100% of budget, applicable bonus increases ratably from 0% to 3.3% of base
salary. If actual third party net sales were between 100% and 120% of budget, the applicable bonus increases ratably from 3.3% to 10% of base salary.
|
| |
|
(3)
|
For actual achievement within 2% of budgeted standard variable margin, the applicable bonus increases ratably from 0% to
12.5% of base salary. |
| |
|
(4)
|
Mr. Smejkal would not be eligible to receive a bonus if actual free cash was under $100 million. If actual free cash were
between $100 million and budget, the applicable bonus increases ratably from 0% to 10% of base salary. |
| |
|
(5)
|
Mr. Smejkal would not be eligible to receive a bonus for sales in excess of budget if
actual performance were less than 103% of budget. If actual third party net sales were between 103% and 110% of budget, applicable bonus increases ratably from 0% to 10% of base salary.
|
| |
|
(6)
|
Mr. Smejkal's individual performance goals for 2022 (with related bonus opportunity as a percentage of base salary in parentheses) included: achieving defined growth and sales targets for specific product lines, end-use markets,
regions, and customers (totaling 12%); developing and delivering defined education sessions, webinars, and a virtual event (totaling 2%); and identifying acquisition targets (1.0%). The achievement of these goals was evaluated and
measured in the aggregate.
|
Mr. Tse
For 2022, Mr. Tse's incentive
compensation was comprised of one element equal to 0.07% of adjusted net earnings and other elements expressed as a percentage of base salary, measured against performance goals. These other elements were structured as follows:
|
CATEGORY
|
|
TARGET(1)
|
|
MAXIMUM
|
|
RELATIVE ACHIEVEMENT VS. BUDGET/EXPECTATION
|
|
ACHIEVEMENT (AS A PERCENTAGE OF BASE SALARY)
|
|
Adjusted operating margin, Semiconductor segments(2)
|
|
9.0%
|
|
15.0%
|
|
126.0%
|
|
14.2%
|
|
Divisional free cash - Semiconductor segments(3)
|
|
7.0%
|
|
7.0%
|
|
>100%
|
|
7.0%
|
| Variable margin of defined R&D projects(4) |
|
5.0% |
|
5.0% |
|
>100%
|
|
5.0%
|
Variable margin on Semiconductor segments' sales(5)
|
|
5.0%
|
|
5.0%
|
|
2.5%
|
|
5.0%
|
| Defined goals for organic growth - Semiconductor segments(6) |
|
8.0% |
|
8.0% |
|
95.1%
|
|
7.6% |
|
Personal objectives(7)
|
|
10.0%
|
|
10.0%
|
|
90.0%
|
|
9.0%
|
|
Total
|
|
44.0%
|
|
50.0%
|
|
|
|
47.8%
|
|
(1)
|
The percentage at "Target" in this table represents the bonus payable at achievement of 100% of budget / expectation.
|
| |
|
| (2) |
Mr. Tse would not be eligible to receive a bonus if actual performance were less than 85% of budget. If actual adjusted operating margins were between 85% and 100% of budget, applicable bonus increases ratably from 0% to 9% of base salary.
If adjusted operating margins were between 100% and 130% of budget, applicable bonus increases ratably from 9% to 15% of base salary.
|
| |
|
(3)
|
Mr. Tse would not be eligible to receive a bonus if divisional free cash for the Semiconductor segments were less than 70%
of budget. If actual divisional free cash is between 70% and 100% of budget, applicable bonus increases ratably from 0% to 7% of base salary.
|
| |
|
(4)
|
For achievement of 0% to 100% of budget, the applicable bonus increases ratably from 0% to 5% of base salary. |
| |
|
(5)
|
For achievement within 2% of applicable variable margin to budgeted variable margin, the applicable bonus increases ratably
from 0% to 5% of base salary.
|
| |
|
(6)
|
For achievement of 0% to 100% of expected project completions, the applicable bonus increases ratably from 0% to 8% of base
salary.
|
| |
|
(7)
|
Mr. Tse's individual performance goals for 2022 (with related bonus opportunity as a percentage of base salary in parentheses) included: reducing customer complaints to specified goals (2.0%); achieving specified sales service targets
(2.0%); overseeing the qualification process of a new foundry (1.0%); overseeing certain expansion projects (4.0%); and developing a strategic plan for a specific manufacturing facility (1.0%).
|
Mr. Webster
For 2022, Mr. Webster's incentive compensation was
comprised of one element equal to 0.07% of adjusted net earnings and other elements expressed as a percentage of base salary, measured against performance goals. These other elements were structured as follows:
|
CATEGORY
|
|
TARGET(1)
|
|
MAXIMUM
|
|
RELATIVE ACHIEVEMENT VS. BUDGET/EXPECTATION
|
|
ACHIEVEMENT (AS A PERCENTAGE OF BASE SALARY)
|
|
Adjusted operating margin, Passive segments(2)
|
|
9.0%
|
|
15.0%
|
|
107.6%
|
|
10.5%
|
|
Divisional free cash - Passive segments(3)
|
|
7.0%
|
|
7.0%
|
|
87.5%
|
|
4.1%
|
| Variable margin of defined R&D projects(4) |
|
5.0% |
|
5.0% |
|
82.2%
|
|
4.1%
|
Variable margin on Passive segments' sales(5)
|
|
5.0%
|
|
5.0%
|
|
-0.7%
|
|
3.3%
|
| Defined goals for organic growth - Passive segments(6) |
|
8.0% |
|
8.0% |
|
>100%
|
|
8.0% |
|
Personal objectives(7)
|
|
10.0%
|
|
10.0%
|
|
62.0%
|
|
6.2%
|
|
Total
|
|
44.0%
|
|
50.0%
|
|
|
|
36.2%
|
|
(1)
|
The percentage at "Target" in this table represents the bonus payable at achievement of 100% of budget / expectation.
|
| |
|
| (2) |
Mr. Webster would not be eligible to receive a bonus if actual performance were less than 85% of budget. If actual adjusted operating margins were between 85% and 100% of budget, applicable bonus increases ratably from 0% to 9% of base
salary. If adjusted operating margins were between 100% and 130% of budget, applicable bonus increases ratably from 9% to 15% of base salary.
|
| |
|
(3)
|
Mr. Webster would not be eligible to receive a bonus if divisional free cash for the Passive segments were less than 70% of
budget. If actual divisional free cash is between 70% and 100% of budget, applicable bonus increases ratably from 0% to 7% of base salary.
|
| |
|
(4)
|
For achievement of 0% to 100% of budget, the applicable bonus increases ratably from 0% to 5% of base salary. |
| |
|
(5)
|
For achievement within 2% of applicable variable margin to budgeted variable margin, the applicable bonus increases ratably
from 0% to 5% of base salary.
|
| |
|
(6)
|
For achievement of 0% to 100% of expected project completions, the applicable bonus increases ratably from 0% to 8% of base
salary.
|
| |
|
(7)
|
Mr. Webster’s individual performance goals for 2022 (with related bonus opportunity as a percentage of base salary in parentheses) included: achieving certain pricing improvements (3.0%); realizing
certain operating metrics (5.0%); developing specifically identified product strategies (1.0%); and achieving specified sales service targets (1.0%).
Mr. Webster’s incentive compensation (including the portion payable under the Cash Bonus Plan) for 2022 was limited by a cap equal to one-times his base salary. This cap was set by the Compensation
Committee and included in his employment agreement as in effect for 2022.
|
Mr. Randebrock
For 2022, Mr. Randebrock's incentive compensation was comprised of one element equal to 0.05% of
adjusted net earnings and other elements expressed as a percentage of base salary, measured against performance goals. These other elements were structured as follows:
|
CATEGORY
|
|
TARGET(1)
|
|
MAXIMUM
|
|
RELATIVE ACHIEVEMENT VS. BUDGET/EXPECTATION
|
|
ACHIEVEMENT (AS A PERCENTAGE OF BASE SALARY)
|
Free cash(2)
|
|
10.0%
|
|
10.0%
|
|
>100%
|
|
10.0%
|
|
Fixed costs(3)
|
|
10.0%
|
|
10.0%
|
|
<97%
|
|
0.0%
|
|
Personal objectives(4)
|
|
10.0%
|
|
10.0%
|
|
80.0%
|
|
8.0%
|
|
Total
|
|
30.0%
|
|
30.0%
|
|
|
|
18.0%
|
|
(1)
|
The percentage at "Target" in this table represents the bonus payable at achievement of 100% of budget / expectation.
|
| |
|
(2)
|
Mr. Randebrock would not be eligible to receive a bonus if actual free cash was under $100 million. If actual free cash were between $100 million and budget, the applicable bonus increases ratably from 0% to
10.0% of base salary.
|
| |
|
(3)
|
For achievement of 97% to 100% of budgeted fixed costs under responsibility, the
applicable bonus increases ratably from 5.0% to 10.0% of base salary.
|
| |
|
(4)
|
Mr. Randebrock’s individual performance goals for 2022 (with
related bonus opportunity as a percentage of base salary in parentheses) included: implementing an HR IT system (3.0%); expanding succession planning efforts (2.0%); achieving certain talent acquisition and retention goals (2.0%); rolling out
a financial training course for operations personnel (2.0%); and supporting certain expansion plans (1.0%).
|
Other Considerations Regarding Executive Compensation
Israeli benefits
Messrs. Zandman and Webster are employed by Vishay Israel Ltd., an Israeli subsidiary of Vishay Intertechnology, Inc., and are residents of Israel. As a result, they are entitled to
certain benefits that are generally available to employees in Israel on a non-discriminatory basis, but are not afforded to the other Executive Officers. These include Company contributions to the following benefits or benefit-funds:
|
•
|
advanced training fund, 7.5% of base salary
|
| |
|
|
•
|
severance fund, 8.33% of base salary
|
| |
|
|
•
|
disability insurance, 2.5% of base salary
|
| |
|
|
•
|
pension fund, 5% of base salary
|
These benefits are required by Israeli law or employment practices generally, and were taken into account by the Compensation Committee in formulating the overall compensation package
for our executive officers.
In addition, as noted above, Mr. Zandman elected to participate in a non-qualified deferred compensation plan available to Vishay Israel Ltd. highly-compensated employees in 2022.
Foreign currency considerations
Dr. Paul was and Mr. Randebrock is employed by German subsidiaries of Vishay, Vishay Europe GmbH and Vishay Electronic GmbH, respectively, and are German citizens. Accordingly, our
employment agreements with Dr. Paul and Mr. Randebrock provided for their base salaries to be denominated (and paid) in euro. Ms. Lipcaman is also employed by Vishay Europe GmbH, and her employment agreement provides for her base salary to be
denominated (and paid) in euro. Mr. Vandoorn was employed by Vishay Capacitors Belgium NV and is a citizen of Belgium. His employment agreement provided for his base salary to be denominated (and paid) in euro. Messrs. Zandman and Webster, as
residents of Israel, have their base salaries denominated (and paid) in new Israeli shekels. Mr. Tse was employed by Vishay Singapore Pte. Ltd. and is a resident of the Republic of China (Taiwan), with his base salary denominated (and paid) in Taiwan
dollars. The amounts reported in U.S. dollars as compensation for these executives fluctuate based on changes in exchange rates. The dollar amounts shown in the Summary Compensation Table were determined using the 2022 annual average exchange rates.
"Jubilee" Long-Service Awards
All employees of certain Vishay subsidiaries in Europe receive a special award upon achieving certain defined
years-of-service milestones. None of the Executive Officers received a jubilee service award in 2022.
Tax deductibility of executive compensation
On December 22, 2017, the Tax Cuts and Jobs Act ("TCJA") was enacted in the United States.
Prior to the enactment of the TCJA, Section 162(m) of the Internal Revenue Code limited the annual tax deduction for compensation paid to each of the Chief Executive Officer and any
of the three other highest paid executive officers, other than the Chief Financial Officer, to $1 million. However, compensation that qualified as performance-based compensation was deductible even in excess of $1 million.
The TCJA continues the $1 million limitation on the annual tax deduction for compensation paid to "covered employees," and expands the officers considered "covered employees." The
Chief Financial Officer is now also considered a "covered employee." In addition, any executive who is identified as a covered employee for a tax year after December 31, 2016, remains a covered employee for all future years.
The TCJA removes the exemption for "qualified performance-based compensation" and also removes the exemption for compensation paid after termination, in each
case, except for compensation payable under a written binding contract in effect on November 2, 2017, so long as the contract is not materially modified after that date.
As part of its role, the Compensation Committee reviews and considers the tax deductibility of executive compensation. Although the Company will not receive the benefit of deductibility for new awards of performance-based compensation that are in
excess of the $1 million deductibility cap, the Compensation Committee continues to view pay for performance as an important part of our executive compensation policy.
Certain covenants
Under the terms of their employment arrangements, the Executive Officers are subject to customary non-competition, non-solicitation, non-disparagement and confidentiality covenants
(or, in the cases of Ms. Lipcaman and Mr. Randebrock, are subject to garden leave provisions that would have a similar effect). The non-competition and non-solicitation covenants for executives remain in force through the first or second anniversary
of the date of termination of the executive's employment with the Company depending on the executive's position.
Clawback Policy
The Company has a formal clawback
policy under which Vishay will seek to recover erroneously awarded compensation during the prior three years from executive officers upon a restatement of Vishay's financial statements, unless the Compensation Committee determines it would be
impracticable or impermissible to do so. The clawback policy is administered by the Compensation Committee, which has the sole discretion in making all determinations under the clawback policy. In 2022, the SEC adopted final rules under the Dodd-Frank
Wall Street Reform and Consumer Protection Act of 2010 related to clawbacks. Stock exchanges must implement listing standards which require public companies to adopt and disclose clawback policies that are compliant with the final rules. The
Compensation Committee will review the Company's existing clawback policy in light of this recent development.
Executive Compensation Advisory Vote
and Its Frequency
Our Board included an advisory
stockholder vote on executive compensation (commonly referred to as "say-on-pay") in its 2022 proxy materials. The Compensation Committee appreciates that over 96% of the votes cast on such proposal approved the executive compensation discussed and
disclosed in the Compensation Discussion and Analysis, the compensation tables, and the narrative executive compensation disclosure contained in our 2022 Proxy Statement. Our Compensation Committee interprets the results of this vote as an endorsement
of existing programs and therefore, we have not made material changes to our approach to executive officer compensation based on such vote.
In addition, our Board included in its
2019 proxy materials an advisory stockholder vote on how frequently it should conduct a “say-on-pay” vote. In line with the Board’s recommendation, a majority of the shares voting recommended that the Company conduct a “say-on-pay” vote annually.
Therefore, our Board of Directors is again this year submitting for a non-binding stockholder vote our executive compensation as described in this proxy statement.
REPORT OF THE COMPENSATION COMMITTEE
To Our Stockholders:
We have reviewed and discussed with management the Compensation Discussion and Analysis. Based on that review and discussion, we have recommended to the Board of Directors and the
Board has approved, that the Compensation Discussion and Analysis be included in this proxy statement and incorporated by reference into the Company's Annual Report on Form 10-K for the year ended December 31, 2022.
Respectfully submitted,
The Compensation Committee of the Board of Directors
Timothy V. Talbert, Chair
Dr. Renee B. Booth
Dr. Abraham Ludomirski
Notwithstanding anything to the contrary set forth in any of our previous or future filings under the Securities Act or the Exchange Act that might incorporate
this proxy statement or future filings with the SEC, in whole or in part, the above report shall not be deemed to be "soliciting material" or "filed" with the SEC and shall not be deemed to be incorporated by reference into any such filing.
Summary Compensation Table
The following table summarizes information regarding compensation earned, held by, or paid to our principal executive officer ("PEO"), principal financial officer ("PFO"), and our
three mostly highly compensated executive officers other than the PEO and PFO. The information included in the table should be read in conjunction with the footnotes which follow, the descriptions of the employment arrangements with each Executive
Officer described in "Compensation Discussion and Analysis," and the additional tables on the pages which follow.
The Compensation Committee of the Board of Directors establishes and approves all compensation for all Executive Officers and administers Vishay's incentive and equity-based
compensation plan. Because the Compensation Committee determines compensation for all Executive Officers, the "Compensation Discussion and Analysis" section discusses compensation of all of our Executive Officers. The compensation tables which
follow include only the five executives required to be disclosed in this manner by SEC rules ("Named Executive Officers").
|
|
|
|
SALARY
|
|
STOCK AWARDS
|
|
NON-EQUITY INCENTIVE PLAN COMP.
|
|
CHANGE IN PENSION VALUE AND NON-QUALIFIED DEFERRED COMP. EARNINGS
|
|
ALL OTHER COMP.
|
|
|
|
| |
|
|
|
(1)
|
|
(2)(3)(4)
|
|
(5)
|
|
(6)(7)(8)
|
|
(9)
|
|
TOTAL
|
|
|
NAME AND PRINCIPAL POSITION
|
|
YEAR
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|
|
(a)
|
|
(b)
|
|
(c)
|
|
(e)
|
|
(g)
|
|
(h)
|
|
(i)
|
|
(j)
|
|
|
Marc Zandman
|
|
2022
|
|
$
|
1,220,383
|
|
$
|
1,448,072
|
|
$
|
3,661,149
|
|
$
|
-
|
|
$
|
569,748
|
|
$
|
6,899,352
|
|
|
Executive Chair of the Board,
|
|
2021
|
|
|
1,231,008
|
|
|
1,689,011
|
|
|
3,372,960
|
|
|
1,135,297
|
|
|
477,028
|
|
|
7,905,304
|
|
|
Chief Business Development Officer,
|
|
2020
|
|
|
1,121,887
|
|
|
1,224,817
|
|
|
1,340,500
|
|
|
858,944
|
|
|
511,103
|
|
|
5,057,251
|
|
|
and President - Vishay Israel Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dr. Gerald Paul
|
|
2022
|
|
|
1,193,872
|
|
|
1,828,695
|
|
|
3,581,616
|
|
|
-
|
|
|
213,628
|
|
|
6,817,811
|
|
|
President and Chief Executive Officer
|
|
2021
|
|
|
1,304,432
|
|
|
2,171,288
|
|
|
3,913,296
|
|
|
783,819
|
|
|
215,688
|
|
|
8,388,523
|
|
|
|
|
2020
|
|
|
1,219,556
|
|
|
1,592,626
|
|
|
1,675,625
|
|
|
624,239
|
|
|
210,768
|
|
|
5,322,814
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lori Lipcaman
|
|
2022
|
|
|
499,848
|
|
|
332,192
|
|
|
499,848
|
|
|
-
|
|
|
29,202
|
|
|
1,361,090
|
|
|
Executive Vice President and
|
|
2021
|
|
|
546,137
|
|
|
403,826
|
|
|
546,137
|
|
|
30,676
|
|
|
34,200
|
|
|
1,560,976
|
|
|
Chief Financial Officer
|
|
2020
|
|
|
510,600
|
|
|
248,721
|
|
|
349,149
|
|
|
253,947
|
|
|
30,355
|
|
|
1,392,772
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Johan Vandoorn
|
|
2022
|
|
|
561,374
|
|
|
266,492
|
|
|
561,374
|
|
|
- |
|
|
1,844,749
|
|
|
3,233,989
|
|
|
Executive Vice President and
|
|
2021
|
|
|
613,361
|
|
|
323,942
|
|
|
613,361
|
|
|
-
|
|
|
190,715
|
|
|
1,741,379
|
|
|
Chief Technical Officer
|
|
2020
|
|
|
573,450
|
|
|
186,225
|
|
|
380,060
|
|
|
-
|
|
|
177,206
|
|
|
1,316,941
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Clarence Tse
|
|
2022
|
|
|
672,001
|
|
|
240,994
|
|
|
639,189
|
|
|
- |
|
|
2,116,504 |
|
|
3,668,688
|
|
|
Executive Vice President
|
|
2021
|
|
|
693,378 |
|
|
288,272 |
|
|
551,594 |
|
|
- |
|
|
155,603 |
|
|
1,688,847 |
|
|
Business Head Semiconductors
|
|
2020
|
|
|
637,806
|
|
|
151,152
|
|
|
303,673
|
|
|
-
|
|
|
147,863
|
|
|
1,240,494
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Column (c) reflects base salary earned during the respective years. The employment agreements for Dr. Paul, Mr. Vandoorn, and Ms. Lipcaman specify that their salaries be denominated and paid in euro. The
employment agreement for Mr. Zandman provides for his salary to be denominated and paid in Israeli shekels. The employment agreement for Mr. Tse specifies for his salary to be denominated and paid in new Taiwan dollars. The amounts presented
have been converted into U.S. dollars at the weighted average exchange rate for the year.
|
| |
|
|
(2)
|
Column (e) represents the grant-date fair value of RSUs and PBRSUs granted in the respective years determined in accordance with FASB ASC Topic 718 in the year of grant. The grant-date fair value is based on the
same assumptions described in Note 12 of our consolidated financial statements included in our Form 10-K filed on February 22, 2023, including the consideration of the present value of assumed dividends which are not received by the RSU holder
during the vesting period. The grant-date fair value is recognized for accounting purposes over the period the recipient is required to provide service in exchange for the respective awards. At the grant date, the Company expected all
performance-based vesting criteria to be achieved. Accordingly, the grant-date fair value for the PBRSUs reflects the expectation that the maximum number of units will be earned. The common stock underlying the RSU and PBRSU awards is not
received until the awards are vested (in some cases, subject to satisfaction of performance conditions) and accordingly, there can be no assurance that the grant-date fair value of these awards will ever be realized.
|
| |
|
| (3) |
For financial accounting purposes, the grant-date fair value is determined on the date that the Compensation Committee approves the number of RSUs to be granted under this
provision. Accordingly, the value of the grant shown in the Summary Compensation Table will be different than the LTI value. |
| |
|
| (4) |
Column (e) also includes the grant-date fair value of 5,000 phantom stock units awarded annually to Mr. Zandman and Dr. Paul pursuant to the terms of their
employment agreements. The common stock underlying these awards is not received until termination of employment, and accordingly, there can be no assurance that the grant-date fair value of these awards will ever be realized. |
| |
|
| (5) |
Column (g) reflects non-equity incentive compensation earned by our executive officers during the respective years, translated at the weighted average exchange rate for the year.
The incentive compensation for 2022 for Dr. Paul, Ms. Lipcaman, and Mr. Vandoorn was limited by the caps set by the Compensation Committee and included in their respective employment agreements. |
| |
|
| (6) |
Column (h) reflects the change in the actuarial present value of the Named Executive Officer's pension and other post-employment benefits under respective defined benefit
retirement plans, from the plan measurement date used in preparing the prior year consolidated financial statements to the plan measurement date used in preparing the current year consolidated financial statements, determined using the same
interest rate, mortality, and other actuarial assumptions used in our consolidated financial statements as set forth in Note 11 thereof. Messrs. Vandoorn and Tse do not participate in any defined benefit retirement plans. No amounts are
presented for 2022 for Mr. Zandman, Dr. Paul, and Ms. Lipcaman because changes in actuarial assumptions and exchange rate impacts resulted in a decrease in the net present value of such benefits by $992,565, $1,821,118, and $797,129,
respectively.
|
| |
|
| (7) |
The Company includes in these pension and post-employment benefits certain termination benefits for Dr. Paul and Mr. Zandman which are payable at normal retirement if such
executives are employed by the Company at age 62. See "Pension and Retirement Benefits" beginning on page 55. |
| |
|
| (8) |
Dr. Paul and Mr. Zandman also receive annual contributions to our non-qualified deferred compensation plan under which amounts deferred are credited with earnings based on the
performance of notional investment options available under the plan. No portion of the earnings credited were "above market" or "preferential." Consequently, no deferred compensation plan earnings are included in the amounts reported in column
(h). See the "Non-qualified Deferred Compensation" table for more information on the benefits payable under the non-qualified deferred compensation plan. |
| (9) |
All Other Compensation includes amounts deposited on behalf of each Named Executive Officer into Vishay's non-qualified deferred compensation plan pursuant to the employment
agreements with each Executive Officer, personal use of company car, Company contributions to defined contribution plans outside of the United States, benefits generally available to employees in Israel, medical benefits in excess of normal
group or government health insurance in country of residence, additional units of phantom stock granted as a result of dividends declared by the Company, and other perquisites, as described below (asterisk denotes amounts paid in foreign
currency and translated at average exchange rates for the year): |
|
|
|
2022
|
|
|
2021
|
|
|
2020
|
|
|
|
Marc Zandman
|
|
$
|
100,000
|
|
|
$
|
100,000
|
|
|
$
|
100,000
|
|
Company contribution to non-qualified deferred compensation plan
|
|
|
|
|
71,720
|
|
|
|
71,666
|
|
|
|
89,512
|
|
Personal use of Company car*
|
|
|
|
|
270,586
|
|
|
|
179,543
|
|
|
|
194,594
|
|
Statutory Israeli employment benefits*
|
|
|
|
|
82,766
|
|
|
|
85,543
|
|
|
|
89,920
|
|
Medical and prescription drug costs
|
|
|
|
|
44,676
|
|
|
|
40,276
|
|
|
|
37,077
|
|
Phantom stock - dividend equivalents
|
|
|
|
$
|
569,748
|
|
|
$
|
477,028
|
|
|
$
|
511,103
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dr. Gerald Paul
|
|
$
|
100,000
|
|
|
$
|
100,000
|
|
|
$
|
100,000
|
|
Company contribution to non-qualified deferred compensation plan
|
|
|
|
|
41,069
|
|
|
|
46,218
|
|
|
|
44,507
|
|
Personal use of Company car*
|
|
|
|
|
27,883
|
|
|
|
29,194
|
|
|
|
29,184
|
|
Company-paid medical costs*
|
|
|
|
|
44,676
|
|
|
|
40,276
|
|
|
|
37,077
|
|
Phantom stock - dividend equivalents
|
|
|
|
$
|
213,628
|
|
|
$
|
215,688
|
|
|
$
|
210,768
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lori Lipcaman
|
|
$
|
13,922
|
|
|
$
|
16,980
|
|
|
$
|
14,455
|
|
Personal use of Company car*
|
|
|
|
|
15,280
|
|
|
|
17,220
|
|
|
|
15,900
|
|
Company-paid medical costs*
|
|
|
|
$
|
29,202
|
|
|
$
|
34,200
|
|
|
$
|
30,355
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Johan Vandoorn
|
|
$
|
19,423
|
|
|
$
|
22,142
|
|
|
$
|
21,512
|
|
Personal use of Company car*
|
|
|
|
|
137,097
|
|
|
|
164,042
|
|
|
|
151,338
|
|
Company contribution to defined contribution retirement plan and related life insurance*
|
|
|
|
|
323
|
|
|
|
273
|
|
|
|
255
|
|
Company-paid medical costs*
|
| |
|
|
3,784
|
|
|
|
4,258
|
|
|
|
4,101
|
|
Allowances*
|
|
|
|
|
1,684,122
|
|
|
|
-
|
|
|
|
-
|
|
Severance*
|
|
|
|
$
|
1,844,749
|
|
|
$
|
190,715
|
|
|
$
|
177,206
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Clarence Tse |
|
$ |
58,725
|
|
|
$ |
60,286 |
|
|
$ |
55,495
|
|
Personal use of Company car*
|
| |
|
|
-
|
|
|
|
57,244 |
|
|
|
55,129
|
|
Company contribution to defined contribution retirement plan and related life insurance*
|
| |
|
|
19,139 |
|
|
|
23,623 |
|
|
|
23,372
|
|
Company-paid medical costs*
|
| |
|
|
10,715
|
|
|
|
10,189 |
|
|
|
9,653
|
|
Children tuition subsidy* |
| |
|
|
11,922
|
|
|
|
4,261 |
|
|
|
4,214 |
|
Accounting services*
|
| |
|
|
2,016,003 |
|
|
|
- |
|
|
|
- |
|
Severance* |
| |
|
$ |
2,116,504
|
|
|
$ |
155,603 |
|
|
$ |
147,863
|
|
Total |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
In addition, for 2022, All Other Compensation for Messrs. Vandoorn and Tse includes three years of salary continuation to which they became entitled following the termination of their
employment without cause, consistent with their employment agreements, totaling $1,684,122 for Mr. Vandoorn and $2,016,003 for Mr. Tse. As part of their severance package, they were also entitled to the bonuses they earned for 2023, which are reported
in "Non-Equity Incentive Compensation." For Dr. Paul, All Other Compensation does not include the salary continuation he received in connection with his retirement. That is because, since 2010, salary continuation and most other elements of his
post-employment compensation were payable for any termination except for cause, and accordingly, have been accounted for as a pension. Changes in the actuarial present value of these benefits have been reported in prior Summary Compensation Tables
under the "Change in pension value and non-qualified deferred comp. earnings" column. The benefits are described in more detail in the section entitled "Payments Upon Termination" in this proxy statement. Because all three departing executives are over
62, the service-based conditions on their outstanding RSUs and PBRSUs were deemed fulfilled, consistent with their employment agreements, and there is no additional compensation to report in the Summary Compensation Table for these amounts in
connection with their termination of employment.
2022 Grants of Plan Based Awards
The following table provides information with regard to plan based awards granted to each Named Executive Officer during 2022. The information included in the table should be read in
conjunction with the footnotes which follow and the description of Vishay's 2007 Program described in "Compensation Discussion and Analysis."
|
|
|
|
|
ESTIMATED FUTURE PAYOUTS UNDER NON-EQUITY INCENTIVE PLAN AWARDS
|
|
EQUITY INCENTIVE PLAN AWARDS: NUMBER OF SHARES OF STOCK OR UNITS
|
|
ALL OTHER STOCK AWARDS: NUMBER OF SHARES OF STOCK OR UNITS
|
|
GRANT DATE FAIR VALUE OF STOCK AWARDS
|
|
|
|
|
|
(1)
|
|
(2)
|
|
(3)
|
|
(4)
|
|
|
|
GRANT
|
|
THRESHOLD
|
|
TARGET
|
|
MAXIMUM
|
|
THRESHOLD
|
|
TARGET
|
|
MAXIMUM
|
|
|
|
|
|
NAME
|
|
DATE
|
|
($)
|
|
($)
|
|
($)
|
|
(#)
|
|
(#)
|
|
(#)
|
|
(#)
|
|
($)
|
|
Marc Zandman
|
|
1/1/2022
|
|
-
|
|
3,340,000
|
|
3,661,149
|
|
-
|
|
-
|
|
-
|
|
5,000
|
|
|
111,000
|
|
|
|
2/22/2022
|
|
-
|
|
-
|
|
-
|
|
27,177
|
|
54,353
|
|
54,353
|
|
18,117
|
|
|
1,337,072
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dr. Gerald Paul
|
|
1/1/2022
|
|
-
|
|
3,581,616
|
|
3,581,616
|
|
-
|
|
-
|
|
-
|
|
5,000
|
|
|
111,000
|
|
|
|
2/22/2022
|
|
-
|
|
-
|
|
-
|
|
34,557
|
|
69,113
|
|
69,113
|
|
23,038
|
|
|
1,717,695
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lori Lipcaman
|
|
1/1/2022 |
|
-
|
|
499,848
|
|
499,848
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
|
|
2/22/2022
|
|
-
|
|
-
|
|
-
|
|
4,502
|
|
9,003
|
|
9,003
|
|
9,002
|
|
|
332,192
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Johan Vandoorn
|
|
1/1/2022
|
|
-
|
|
561,374
|
|
561,374
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
|
|
2/22/2022
|
|
-
|
|
-
|
|
-
|
|
3,611
|
|
7,222
|
|
7,222
|
|
7,222
|
|
|
266,492
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Clarence Tse |
|
1/1/2022 |
|
- |
|
529,481
|
|
672,001
|
|
- |
|
- |
|
- |
|
- |
|
|
- |
| |
|
2/22/2022 |
|
- |
|
- |
|
- |
|
3,266
|
|
6,531
|
|
6,531
|
|
6,531
|
|
|
240,994
|
|
(1)
|
Amounts in these columns represent the threshold, target and maximum bonus levels for each Named Executive Officer. |
| |
|
| (2) |
Included in these columns are PBRSUs granted pursuant to the respective employment agreements of the Named Executive Officers. The number of PBRSUs shown in the "threshold" column are
those that would vest if 70% of the applicable performance criteria are achieved. |
| |
|
| (3) |
Included in this column are awards of phantom stock granted to Mr. Zandman and Dr. Paul and annual awards of RSUs granted pursuant to the respective employment agreements of the Named Executive Officers.
|
| |
|
| (4) |
Amounts in this column include: |
| |
|
•
|
the grant-date fair value of the RSUs (including PBRSUs). The amount is calculated using the closing price of Vishay stock on the date of grant of $19.61 adjusted for the present value of expected dividends. The
common stock underlying these awards is not received until the awards are vested (in some cases, subject to the satisfaction of performance conditions) and accordingly, there can be no assurance that the grant-date fair value of these awards
will ever be realized.
|
| |
|
| • |
the grant-date fair value of 5,000 phantom stock units awarded annually to certain executive officers pursuant to the terms of their employment agreements. The amount is calculated using the closing price of
Vishay stock on the grant date of $22.20. The common stock underlying these awards is not received until termination of employment, and accordingly, there can be no assurance that the grant-date fair value of these awards will ever be
realized.
|
Outstanding Equity Awards at Fiscal Year End
The following table provides information regarding unvested stock awards (RSUs) held by our Named Executive Officers as of December 31, 2022.
|
|
|
|
|
STOCK AWARDS
|
|
NAME
|
|
GRANT DATE
(1)(2)
|
|
NUMBER OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED
(#)
|
|
MARKET VALUE OF SHARES OF UNITS OF STOCK THAT HAVE NOT VESTED
($)
(3)
|
|
EQUITY INCENTIVE PLAN AWARDS: NUMBER OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED
(#)
(4)
|
|
EQUITY INCENTIVE PLAN AWARDS: MARKET OR PAYOUT VALUE OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED
($)
(3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marc Zandman(5)
|
|
2/28/2020
|
|
15,890
|
|
342,747
|
|
47,669
|
|
1,028,220
|
|
|
|
2/23/2021
|
|
17,435 |
|
376,073
|
|
52,308
|
|
1,128,284
|
| |
|
2/22/2022 |
|
18,117
|
|
390,784
|
|
54,353
|
|
1,172,394
|
|
Total
|
|
|
|
51,442
|
|
1,109,604
|
|
154,330
|
|
3,328,898
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dr. Gerald Paul(5)
|
|
2/28/2020
|
|
21,120
|
|
455,558
|
|
63,361
|
|
1,366,697
|
|
|
|
2/23/2021
|
|
22,742
|
|
490,545
|
|
68,228
|
|
1,471,678
|
| |
|
2/22/2022 |
|
23,038
|
|
496,930
|
|
69,113
|
|
1,490,767
|
|
Total
|
|
|
|
66,900
|
|
1,443,033
|
|
200,702
|
|
4,329,142
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lori Lipcaman(5)
|
|
2/28/2020
|
|
3,537
|
|
76,293
|
|
10,611
|
|
228,879
|
|
|
|
2/23/2021
|
|
8,887
|
|
191,693
|
|
8,887
|
|
191,693
|
| |
|
2/22/2022 |
|
9,002
|
|
194,173
|
|
9,003
|
|
194,195
|
|
Total
|
|
|
|
21,426
|
|
462,159
|
|
28,501
|
|
614,767
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Johan Vandoorn(5)
|
|
2/28/2020
|
|
2,648
|
|
57,117
|
|
7,945
|
|
171,374
|
|
|
|
2/23/2021
|
|
7,129
|
|
153,773
|
|
7,129
|
|
153,773
|
| |
|
2/22/2022 |
|
7,222
|
|
155,779
|
|
7,222
|
|
155,779
|
|
Total
|
|
|
|
16,999
|
|
366,669
|
|
22,296
|
|
480,926
|
|
|
|
|
|
|
|
|
|
|
|
|
| Clarence Tse(5) |
|
2/28/2020 |
|
2,149 |
|
46,354
|
|
6,449 |
|
139,105
|
| |
|
2/23/2021 |
|
6,344 |
|
136,840
|
|
6,344 |
|
136,840
|
| |
|
2/22/2022
|
|
6,531
|
|
140,874
|
|
6,531
|
|
140,874
|
|
Total
|
|
|
|
15,024
|
|
324,068
|
|
19,324
|
|
416,819
|
|
(1)
|
RSUs granted February 28, 2020, cliff-vested on January 1, 2023.
|
| |
|
| (2) |
75% of the RSUs granted in each of 2020 and 2021, include performance-based vesting criteria. In 2022, 75% of the RSUs for Mr. Zandman and Dr. Paul and 50% of the RSUs for Ms. Lipcaman and Messrs. Vandoorn and Tse,
include performance-based vesting criteria. These performance-based RSUs are shown in the column entitled "Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested."
|
| |
|
| (3) |
Based on the closing price of Vishay common stock on December 31, 2022 of $21.57.
|
| |
|
(4)
|
The performance-based RSUs are shown at "maximum".
|
| |
|
(5)
|
Time-based vesting conditions will be deemed satisfied, and
performance-based vesting conditions will remain in effect, upon the executive's death, disability, termination without cause, resignation with "good reason," or resignation for any reason following the attainment of age 62 (except where
cause exists). In the event of voluntary termination by the executive before age 62 (without "good reason") or termination for cause, the executive's outstanding RSUs (including PBRSUs) will be forfeited. As of December 31, 2022, the
following NEOs had reached age 62:
|
| |
|
Dr. Gerald Paul
|
|
| |
|
Lori Lipcaman
|
|
| |
|
Johan Vandoorn
|
|
| |
|
Clarence Tse
|
|
| |
The time-based vesting conditions for the outstanding RSUs of Dr. Paul and Messrs. Vandoorn and Tse were deemed satisfied upon their
respective cessations of employment on December 31, 2022.
|
The following table provides information with regard to amounts paid to or received by our Named Executive Officers during 2022 as a result of vesting of restricted stock units
(including performance-based RSUs).
|
|
|
|
STOCK AWARDS
|
|
|
|
|
|
NUMBER OF SHARES ACQUIRED ON VESTING
|
|
|
VALUE REALIZED ON VESTING
|
|
|
NAME
|
|
|
(#)
|
|
|
($)
|
|
|
(a)
|
|
|
(d)
|
|
|
(e)
|
|
|
Marc Zandman
|
|
|
|
72,431
|
|
|
|
1,467,272
|
|
|
Dr. Gerald Paul
|
|
|
|
102,249
|
|
|
|
2,071,308
|
|
|
Lori Lipcaman
|
|
|
|
11,416
|
|
|
|
231,260
|
|
|
Johan Vandoorn
|
|
|
|
12,821
|
|
|
|
259,721
|
|
Clarence Tse
|
|
|
|
10,122
|
|
|
|
205,045 |
|
The table above excludes RSUs that vested on January 1, 2023.
Pension and Retirement Benefits
Vishay maintains various retirement benefit plans and arrangements.
Vishay's German subsidiaries have a noncontributory defined benefit plan governed by German law covering its management and executive employees. Dr. Paul and Ms. Lipcaman participate
in this plan. Dr. Paul also has an individual contractual pension arrangement with Vishay Europe GmbH that will pay an annual benefit upon retirement at age 65 based on his years of service (up to 25) and average salary and bonus in the three highest
of his final ten years of employment ("final average compensation"). The retirement benefit will not exceed 40% of such final average compensation, and the individual contractual pension amount will be reduced by pension amounts payable under the
noncontributory defined benefit plan of Vishay Europe GmbH and its subsidiaries. Dr. Paul has voluntarily agreed to a maximum limit of €180,000 per year with respect of such final average compensation.
In 2010, Dr. Paul's and Mr. Zandman's employment arrangements were modified such that upon any termination (other than for cause) after attaining age 62, the executive would be
entitled to the same payments and benefits he would have received if his respective employment was terminated by Vishay without cause or by the respective executive for good reason. These modifications were included in amendments signed on August 8,
2010. The expense associated with the modifications to the employment arrangements of Dr. Paul and Mr. Zandman effectively represents a defined retirement benefit recognized for financial accounting purposes over the remaining service period of the
individuals.
Messrs. Vandoorn and Tse do not participate in any defined benefit retirement plans.
See the discussion of post-employment medical benefits within the section "Employee Benefits" on page 39.
2022 Pension and Retirement Benefits Table
The following table provides information regarding the present value of benefits accrued under these retirement benefit plans and arrangements:
|
NAME
(a)
|
|
PLAN NAME
(b)
|
|
NUMBER OF YEARS CREDITED SERVICE
(#)
(c)
|
|
PRESENT VALUE OF ACCUMULATED BENEFIT (1)
($)
(d)
|
|
PAYMENTS DURING LAST FISCAL YEAR
($)
(e)
|
|
|
Marc Zandman
|
|
Individual contractual post-employment medical arrangement
|
|
n/a
|
|
434,177
|
|
-
|
|
| |
|
Individual contractual termination benefits(3)
|
|
n/a
|
|
8,000,268
|
|
-
|
|
|
Dr. Gerald Paul(2)
|
|
Vishay Europe GmbH Pension Plan and individual contractual arrangement
|
|
n/a
|
|
1,992,982
|
|
-
|
|
|
|
|
Individual contractual post-employment medical arrangement
|
|
n/a
|
|
173,242
|
|
-
|
|
|
|
|
Individual contractual termination benefits(3)
|
|
n/a
|
|
8,787,233
|
|
-
|
|
|
Lori Lipcaman(2)
|
|
Vishay Europe GmbH Pension Plan
|
|
33
|
|
1,231,113
|
|
-
|
|
|
(1)
|
These amounts have been calculated using interest rate, mortality, and other actuarial assumptions consistent with those used for financial reporting purposes set forth
in Note 11 to Vishay's consolidated financial statements included in our 2022 Annual Report on Form 10-K. |
| |
|
| (2) |
Dr. Paul's and Ms. Lipcaman's benefits are denominated in euro. The U.S. dollar amounts shown in the table is based on the weighted average conversion rate for 2022. |
| |
|
| (3) |
These termination benefits are payable upon normal retirement and accordingly the present value is included in this table. See "Potential Payments Upon Termination or
a Change in Control" and "Payments Upon Termination."
|
Non-qualified Deferred Compensation
The Executive Officers may participate in a non-qualified deferred compensation plan, which is available to all employees who meet certain criteria under the Internal Revenue Code.
Certain Executive Officers are entitled under their respective employment agreements to annual contributions to this plan by Vishay, less certain applicable taxes. The Executive Officers are also eligible to elect to defer additional amounts of
compensation, subject to certain limitations.
Amounts contributed to these plans prior to January 1, 2005, were deemed deferred until retirement or termination of employment. Effective January 1, 2005, all employees that
participate in the plan were given the option to choose shorter deferral periods for all or a portion of their deferred compensation. All of the Executive Officers have elected to defer all amounts of compensation until retirement or termination of
employment, at which time, the amounts would be paid in a lump sum. To the extent required to avoid tax penalties, the deferred amounts are not paid until six months after the termination of employment.
While deferred, amounts are credited with "earnings" based on the performance of notional investment options available under the plan.
Effective December 28, 2021, the Compensation Committee approved Messrs. Zandman's and Webster's participation in an elective
deferred compensation arrangement, established by Vishay Israel Ltd. Under these arrangements, an executive who elects to participate may defer payment of a percentage of the executive's salary, annual bonus and certain other benefits. During the executive’s continued service, amounts deferred under an arrangement will be deemed invested in investment
funds selected by the executive from a list made available by Vishay Israel. Payment of the deferred amounts (as adjusted for notional earnings and losses) will be made in a lump sum upon the executive’s death, disability or other cessation of
service (subject to a six month delay, if required by applicable law). These payments will be made from the general assets of Vishay Israel, which may include insurance policies purchased by Vishay Israel to anticipate its liabilities under these
arrangements. In addition, the Company has guaranteed Vishay Israel's obligations under these arrangements.
Mr. Zandman elected to participate in these arrangements in 2022. Mr. Webster did not elect to participate in these Israeli
arrangements.
2022 Non-qualified Deferred Compensation Table
The following table sets forth information relating to the activity in the non-qualified deferred compensation plan accounts of the Executive Officers during 2022 and the aggregate
balance of the accounts as of December 31, 2022:
|
NAME
(a)
|
|
EXECUTIVE CONTRIBUTIONS IN LAST FISCAL YEAR
(1)
($)
(b)
|
|
REGISTRANT CONTRIBUTIONS IN LAST FISCAL YEAR
(2)
($)
(c)
|
|
AGGREGATE EARNINGS IN LAST FISCAL YEAR
($)
(d)
|
|
AGGREGATE WITHDRAWALS/DISTRIBUTIONS
($)
(e)
|
|
AGGREGATE BALANCE AT LAST FISCAL YEAR END
(3)
($)
(g)
|
|
|
Marc Zandman
|
|
|
|
263,530
|
|
|
|
100,000
|
|
|
|
(784,964
|
)
|
|
|
-
|
|
|
|
3,854,204
|
|
|
Dr. Gerald Paul
|
|
|
|
-
|
|
|
|
100,000
|
|
|
|
26,888
|
|
|
|
-
|
|
|
|
2,051,531
|
|
| |
|
(1)
|
For Mr. Zandman, these amounts relate to contributions to the Israeli Deferred Compensation Plan.
|
|
(2)
|
These amounts are included in column (i) of the "Summary Compensation Table" as a component of "All Other Compensation." No portion of the earnings credited during
2022 was "above market" or "preferential." Accordingly, no amounts related to earnings on deferred compensation have been included in the "Summary Compensation Table." |
(3)
|
Of the amount reported, $1,900,000 has been previously reported in the Summary Compensation Tables of prior years' proxy statements for each of Mr.
Zandman and Dr. Paul.
|
Payments Upon Termination
Dr. Paul
Dr. Paul retired effective December 31, 2022. Since 2010, Dr. Paul’s employment contract has contained provisions providing generally for three years of compensation in the case of
any termination (other than for cause) after attaining age 62.
That amount, and other relevant items payable upon Dr. Paul’s termination of employment, include:
|
•
|
salary continuation for three years, payable over three years (approximately $3,582,000, three times U.S. dollar value of the 2022 salary);
|
| |
|
|
•
|
bonus for the year of termination (Non-equity incentive plan compensation for 2022 as reflected in the "Summary Compensation Table");
|
| |
|
|
•
|
5,000 shares of common stock annually for three years (valued at approximately $324,000 as of December 31, 2022);
|
| |
|
|
•
|
service-based vesting criteria applicable to outstanding equity awards is deemed satisfied and performance-based vesting criteria remains in effect (approximately $5,772,000; the number of units and value at December 31, 2022, is
summarized under the heading "Outstanding Equity Awards at Fiscal Year End" on page 54);
|
| |
|
| • |
lump sum cash payment of $1,500,000;
|
| |
|
| • |
accumulated pension benefits (approximately $1,992,982, based on the actuarial present value of accumulated benefit reflected in the "Pension Benefits" table, paid annually until death;
|
| |
|
| • |
lifetime continuation of his life insurance benefits, with a death benefit equal to one time final base salary payable to beneficiaries. The Company has decided to self-insure these obligations (approximately $1,194,000 at the U.S.
dollar value of the 2022 base salary, without consideration of the time value of money);
|
| |
|
| • |
lifetime continuation of executive's medical benefits up to an annual premium value of $15,000 (approximately $173,242 based on the actuarial present value of lifetime retiree medical benefit);
|
| |
|
| • |
the aggregate balance of non-qualified deferred compensation ($2,051,531, as reflected in the "Non-qualified Deferred Compensation" table);
|
| |
|
| • |
settlement of 113,114 phantom stock units in shares of common stock (valued at $2,439,869 as of December 31, 2022); and
|
| |
|
| • |
Continued personal use of Company vehicles during his salary continuation period, consistent with prior practice for retired senior leaders
in Germany.
|
Messrs. Vandoorn, Tse, and
Valletta
Messrs. Vandoorn, Tse, and Valletta ceased being Executive Officers of Vishay effective December 31, 2022, as part of the Company’s executive transition plan.
The Board of Directors has determined that each executive’s termination of employment on December 31, 2022, was without cause. Accordingly, each departing executive was entitled to
severance benefits consistent with those described in his employment agreement. Generally, these severance benefits consist of three years of base salary continuation and an annual bonus for 2022 based on actual performance. In addition,
service-based vesting criteria applicable to the executives' outstanding equity awards was deemed satisfied in connection with the termination and performance-based vesting criteria remains in effect for outstanding PBRSUs. These severance benefits
were conditioned upon the executive signing a release of claims and complying with his pre-existing restrictive covenants.
The following table summarizes compensation payable to these executives under these termination arrangements:
NAME
|
|
SALARY CONT.
(1)
|
|
|
BONUS
(2)
|
|
|
STOCK GRANTS
(3)
|
|
|
TOTAL
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Johan Vandoorn
|
|
$
|
1,684,122
|
|
|
$
|
561,374
|
|
|
$
|
847,595
|
|
|
$
|
3,093,091
|
|
|
Clarence Tse
|
|
|
2,016,003
|
|
|
|
639,189
|
|
|
|
740,887
|
|
|
|
3,396,079
|
|
|
David Valletta
|
|
|
1,746,996
|
|
|
|
571,870
|
|
|
|
804,043
|
|
|
|
3,122,909
|
|
(1)
|
Equal 3 times U.S. dollar value of the 2022 salary.
|
(2)
|
Consists of non-equity incentive plan compensation for 2022 as reflected in the "Summary Compensation Table."
|
(3)
|
Includes the value of RSUs outstanding as of December 31, 2022, including PBRSUs, and assumes all performance criteria will be met. The number of units
outstanding at December 31, 2022, are as follows:
|
| |
|
| |
|
NAME
|
|
RSUs
|
|
PBRSUs
|
|
TOTAL
|
|
|
| |
|
Johan Vandoorn
|
|
|
16,999
|
|
|
22,296
|
|
|
39,295
|
|
|
| |
|
Clarence Tse
|
|
|
15,024
|
|
|
19,324
|
|
|
34,348
|
|
|
| |
|
David Valletta
|
|
|
16,059
|
|
|
21,217
|
|
|
37,276
|
|
|
Potential Payments Upon Termination or a Change in Control
Our employment agreements with our Executive Officers provide incremental compensation in the event of termination, as described below. Termination of employment also impacts phantom
stock units and non-qualified deferred compensation balances. In the event of a change in control, equity awards granted before 2023 automatically vest. Equity awards granted in 2023 and beyond to the Executive Officers, other than Mr. Zandman, will
not automatically vest upon a change in control.
Mr. Zandman
The executive employment contract of Mr. Zandman contains severance provisions providing generally for three years of compensation in the case of a termination without cause, a
voluntary termination by the executive for "good reason" (as defined in the employment agreement), or any termination (other than for cause) after attaining age 62.
Specifically, severance items include:
|
•
|
salary continuation for three years, payable over three years;
|
| |
|
|
•
|
5,000 shares of common stock annually for three years. Because these shares are granted after termination of employment, actual shares – rather than phantom stock units – are granted;
|
| |
|
|
•
|
bonus for the year of termination;
|
| |
|
| • |
payment of any earned but unpaid bonus for the previously completed year;
|
| |
|
|
•
|
$1,500,000 lump sum cash payment. This payment replaces the annual deferred compensation credits and the annual bonus for the 3-year severance period;
|
| |
|
|
•
|
lifetime continuation of executive's life insurance benefit. In lieu of insurance, the Company has assumed this obligation; |
| |
|
|
•
|
service-based vesting criteria applicable to outstanding equity awards is deemed satisfied and performance-based vesting criteria generally remains in
effect; and |
| |
|
|
•
|
continuation of executive's medical benefit for a maximum of three years if the termination occurs before attaining age 62 and lifetime continuation up to an
annual premium value if the termination occurs after attaining age 62. For Mr. Zandman this annual premium value is $50,000 and subject to possible increase as detailed in his employment agreement, see page 39.
|
Other Executives
The employment agreements of Ms. Lipcaman and the other Executive Officers provide that upon a termination without cause or resignation with "good reason" (as defined in the respective agreements), and
subject to the execution of a general release, the executives will be entitled to receive:
|
•
|
continuation of base salary for 36 months;
|
| |
|
|
•
|
payment of any earned but unpaid bonus for the previously completed year; and
|
| |
|
|
•
|
payment of a pro-rata bonus for the year of termination, based on that year's actual performance.
|
Upon a termination without cause or resignation with good reason within 16 months following a change in control, the 36 months of base salary continuation will be paid as a lump
sum payment. In addition, the employment agreements historically provided that during the 12-month period beginning 4 months following a change in control, these executives may voluntarily resign and receive the severance benefits described above
(including the lump sum payment of the salary continuation element) provided that in Ms. Lipcaman's case, the notice and payment timing are slightly different due to local law considerations. As described in the section entitled "2023 Executive
Compensation" below, as of January 1, 2023, the executives will only be entitled to such severance benefits if they have "good reason" to resign following a change in control.
In the event of termination due to death or disability, the executive or their estate will receive payment of any earned but unpaid bonus for the previously completed year; and
payment of a pro-rata bonus for the year of termination, based on that year's actual performance.
Regarding equity awards, time-based vesting conditions will be deemed satisfied, and performance-based vesting conditions will remain in effect, upon the executive's death,
disability, termination without cause, resignation with "good reason," or resignation for any reason following the attainment of age 62 (except where cause exists). Equity awards granted prior to December 31, 2022, immediately vest upon a change in
control; equity awards granted after January 1, 2023, do not automatically vest upon a change in control.
Summary of Potential Payments Upon Termination or a Change in Control
The following table summarizes the elements of compensation that would have been received by each of the Company's continuing named executive officers had they been terminated without
cause or for "good reason" as of December 31, 2022. As described above, the amount of the severance payments would have been the same upon termination without cause or resignation with "good reason" and upon termination following a change of control,
though in the case of Ms. Lipcaman, the timing of such payments differ.
|
|
|
SALARY CONT.
(1)
|
|
|
BONUS
(2)
|
|
|
STOCK GRANTS
(3)(4)
|
|
|
LUMP SUM TERMINATION PAYMENT
|
|
|
PENSION
(5)
|
|
|
MEDICAL BENEFIT
(6)
|
|
|
LIFE INSURANCE
BENEFIT
(7)
|
|
|
NON-QUALIFIED
DEFERRED
COMPENSATION
(8)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marc Zandman
|
|
$
|
3,661,149
|
|
|
$
|
3,661,149
|
|
|
$
|
4,762,052
|
|
|
$
|
1,500,000
|
|
|
$
|
-
|
|
|
$
|
219,018
|
|
|
$
|
1,220,383
|
|
|
$
|
3,854,204
|
|
|
Lori Lipcaman
|
|
|
1,499,544
|
|
|
|
-
|
|
|
|
1,076,925
|
|
|
|
-
|
|
|
|
1,231,113
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
(1)
|
Equals 3 times U.S. dollar value of the 2022 salary. |
| |
|
| (2) |
Consists of non-equity incentive plan compensation for 2022 as reflected in the "Summary Compensation Table." |
| |
|
| (3) |
For Mr. Zandman, includes 15,000 shares, multiplied by $21.57, which was the closing price of Vishay's common stock on December 31, 2022. The shares are to be paid out
over three years. |
| |
|
| (4) |
Includes the value of RSUs outstanding as of December 31, 2022, including PBRSUs, and assumes all performance criteria will be met. |
| |
|
| (5) |
Present value of accumulated benefit reflected in the "Pension Benefits" table, paid annually until death, exclusive of contractual termination payments (other than
retiree medical benefits, which are shown in next column).
|
| |
|
(6)
|
For Mr. Zandman, represents three years of post-termination medical benefits based on 2022 amounts.
|
| |
|
| (7) |
The employment agreement of Mr. Zandman provides for a lifetime continuation of his life insurance benefits, with a death benefit equal to one time final
base salary payable to his respective beneficiaries. The Company has decided to self-insure this obligation. The table estimates the value of this life insurance benefit at the 2022 base salary of Mr. Zandman, without consideration of the time
value of money.
|
| |
|
| (8) |
Aggregate balance at year end as reflected in the "Non-qualified Deferred Compensation" table. |
For Mr. Zandman, a termination by reason of disability is deemed in his
respective employment agreements to be equivalent to a termination without cause. Accordingly, presuming termination by disability as of December 31, 2022, the compensation described in the table above would be payable. Additionally, the employment
agreement of Mr. Zandman provides for disability benefits which are payable if he suffers a disability prior to his attainment of the statutory retirement age in Israel. Such disability benefit is equal to 60% of the sum of Mr. Zandman's base salary
and the average of his annual bonus payments, less certain adjustments as stated in his employment agreement. If Mr. Zandman had become disabled on December 31, 2022, the annual disability payment would have been approximately $2,085,000, and such
disability benefit would have been payable for approximately 5.9 years until he reached the statutory retirement age.
For Ms. Lipcaman, a termination by reason of disability does not
constitute a termination without cause pursuant to her respective employment agreement. Upon a termination by reason of disability, Ms. Lipcaman would be entitled to the following:
|
•
|
a lump sum cash payment equal to all accrued compensation;
|
| |
|
|
•
|
all rights she is entitled to under the terms of any Vishay retirement plans and benefit plans, including disability insurance; and
|
| |
|
|
•
|
payment of a pro-rata bonus for the fiscal year in which notice of termination is given, determined and paid in the same manner and at the same time as such bonus would have been determined and paid in the
absence of such termination.
|
Furthermore, upon termination by reason of disability, any service-based
vesting criteria applicable to outstanding RSUs will be deemed satisfied and any performance-based vesting criteria applicable to such equity awards will remain in effect.
Accordingly, presuming termination by disability as of December 31, 2022, Ms. Lipcaman, would receive her 2022 bonus, as reported in column (e) of the Summary Compensation Table on page 50; plus the amounts presented
in the table above for “stock grants” and “pension.”
Upon a termination by reason of death, the beneficiaries of Mr. Zandman
would be entitled to:
|
•
|
a lump sum cash payment equal to all accrued compensation;
|
| |
|
|
•
|
payment of phantom stock; and
|
| |
|
|
•
|
payment of non-qualified deferred compensation.
|
Additionally, upon a termination by reason of death, the beneficiaries of
Mr. Zandman would be eligible for continued medical benefits and for a death benefit under a self-insured life insurance obligation, equal to three times base salary while employed (and one times base salary upon retirement). Presuming death as of
December 31, 2022, the amounts presented in the table above, other than the “lump sum termination payment,” would be payable upon the death of Mr. Zandman, with the self-insured death benefit replacing the amount presented as “salary continuation.”
For Ms. Lipcaman, a termination by reason of death would result in the
same compensation paid to her respective beneficiaries as would be payable by reason of termination by disability.
Excise Taxes Upon a Change in Control
Following Dr. Paul's
retirement, none of our Executive Officers are entitled to an excise tax gross-up upon a change in control.
Impact on Non-qualified Deferred Compensation Balances
As described above, certain Executive Officers participate in a non-qualified deferred compensation plan. All of the Executive Officers have elected to defer such compensation until
retirement or termination of employment, at which time the amounts would be paid in a lump sum.
Impact on RSUs
With respect to our Executive Officers, time-based vesting conditions will be deemed satisfied, and performance-based vesting conditions will remain in effect, upon the executive's
death, disability, termination without cause, resignation with "good reason," or resignation for any reason following the attainment of age 62 (except where cause exists). Had a change in control occurred on December 31, 2022, all RSUs and PBRSUs
would have vested (with PBRSUs vesting in full, assuming all performance conditions are met). In the event of voluntary termination by the executive before age 62 (without "good reason") or termination for cause, the executive's outstanding RSUs
(including PBRSUs) will be forfeited. At December 31, 2022, unvested time-vested RSUs and PBRSUs were as follows:
|
NAME
|
|
|
UNVESTED TIME-VESTED RSUs
|
|
|
UNVESTED
PBRSUs
|
|
|
Marc Zandman
|
|
|
|
51,442
|
|
|
|
154,330
|
|
|
Lori Lipcaman
|
|
|
|
21,426
|
|
|
|
28,501
|
|
The table above excludes the 2023 annual grant for the current Executive Officers and includes the RSUs that vested January 1, 2023.
Impact on Phantom Stock Units
Mr. Zandman (and historically Dr. Paul) receives an annual grant of 5,000 phantom stock units pursuant to his employment agreement. Additionally, he receives dividend equivalents in
the form of additional phantom stock units each time the Company pays a dividend on its common stock. Upon termination of employment, Mr. Zandman will receive one share of Vishay common stock for each phantom stock unit held.
The table below shows the total phantom stock units held by Mr. Zandman and the value of the underlying common stock at December 31, 2022:
|
NAME
|
|
|
PHANTOM STOCK UNITS
|
|
|
VALUE
|
|
|
Marc Zandman
|
|
|
|
113,114
|
|
|
$
|
2,439,869
|
|
The table above excludes the 2023 annual grant of 5,000 phantom stock units.
Since 2017, the Company has disclosed the ratio of the compensation of its CEO to the compensation of its median employee.
The median employee was chosen in 2020 from a population of all global employees, excluding our CEO, as of December 1, 2020. All employees regardless of
full-time, part-time, or seasonal status were included within the sampled population and there were no adjustments or assumptions made with respect to the salaries and wages metric utilized. Annual salaries and wages were used as the identifying
metric for all employees as it is a consistent measure amongst all employees. We have concluded that there has been no change to our employee population or compensation arrangements that would result in a significant change to our pay ratio disclosure.
Accordingly, we have used the same median employee in 2022 as we used in 2020.
We determined the median employee's total compensation in accordance with SEC
regulations. The total compensation of the median employee was then compared to the total compensation of the CEO. For 2022, the ratio of the CEO total compensation to the median employee total compensation was $6,817,811 : $21,376 or 319 : 1.