UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 23, 2010
(Exact name of registrant as specified in its charter)
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| Ohio
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1-1396
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34-0196300 |
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(State or other
jurisdiction of
incorporation)
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(Commission
File Number)
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(I.R.S. Employer
Identification No.) |
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Eaton Center
Cleveland, Ohio
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44114 |
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(Address of principal executive offices)
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(Zip Code)
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(216) 523-5000
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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| Item 5.02 |
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Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain
Officers; Compensatory Arrangements of Certain Officers. |
1. At a meeting held on February 23, 2010, the Compensation and Organization Committee of the Board
of Directors of the registrant (the “Committee”) established corporate performance criteria which
will be used to determine the aggregate maximum amount of 2010 incentive compensation awards under
the Senior Executive Incentive Compensation Plan (the “Plan”). The Plan participants consist of
the Chief Executive Officer and those officers reporting directly to him. At the same meeting, the
Committee established 2010 individual participant percentages of the aggregate incentive amount,
corporate performance goals and individual incentive target amounts. Under the Plan, the Committee
may use its discretion to reduce an individual participant’s share of the aggregate maximum amount
based on the results under the corporate performance goals and individual performance ratings. For
2010, the aggregate maximum amount has been set by the Committee equal to 2% of the registrant’s
2010 net income, and the corporate performance goals established by the Committee for 2010 are
specific Cash Flow Return on Gross Capital and Earnings Per Share targets, weighted equally. The
individual percentage shares of the aggregate maximum amount for the currently serving executive
officers who were named in the summary compensation table of the registrant’s 2009 Proxy Statement
(the “Named Executive Officers”), range from 14% to 34.2%. Participants in the Plan are not
eligible to participate in the registrant’s long-established Executive Incentive Compensation Plan
which covers the remaining officers and approximately 1,800 other employees of the registrant.
2. Also on February 23, 2010, the Committee approved awards and established individual targets for
the 2010-2013 Award Period under the Section 162(m) qualified long-term Executive Strategic
Incentive Plan which was approved by the shareholders in 2008 (the “ESI Plan”). The aggregate
amounts at target for the Named Executive Officers range from $750,000 to $3,250,000. Awards are
expressed in the form of phantom common share units, although payouts, if any, will be made in
cash, unless the participant has elected to defer receipt of such payment. On February 27, 2010,
the Committee established corporate performance objectives for the 2010-2013 award period under the
ESI Plan, consisting of specific Cash Flow Return on Gross Capital and Earnings Per Share targets.
The actual amount of the payments will depend upon the performance of the registrant against these
targets and the market value of the registrant’s common shares. The registrant has maintained the
ESI Plan for many years in order to provide key senior executives with incentives to achieve
demanding long-term corporate objectives and in order to attract and retain executives of
outstanding ability.
3. Also at the February 23, 2010 meeting, the Committee approved goals under the Supplemental
Executive Strategic Incentive Plan (the “Supplemental ESI Plan”) consisting of specific Cash Flow
Return on Gross Capital and Earnings Per Share targets for 2010 of the 2007-2010 and 2008-2011
Award Periods with respect to incentive opportunities previously approved by the Committee and
discussed in the registrant’s Current Form on Form 8-K dated March 2, 2009. The purpose of these
awards is to ensure that the outstanding four-year awards previously granted under the ESI Plan
continue to serve their intended retention and incentive purposes.