SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant ☒
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Check the appropriate box:
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Preliminary Proxy Statement |
☐ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) | |||
☒ |
Definitive Proxy Statement |
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Definitive Additional Materials |
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☐ |
Soliciting Material Pursuant to §240.14a-11(c) or §240.14a-12 |
WEYERHAEUSER COMPANY
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
☒ | No fee required. |
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Notes:
WEYERHAEUSER NOTICE OF THE 2018 ANNUAL MEETING & PROXY STATEMENT
DEAR SHAREHOLDER:
We are pleased to invite you to attend your companys annual meeting of shareholders at 9:00 a.m. on Friday, May 18, 2018 at the Embassy SuitesPioneer Square, 255 South King Street, Seattle, WA 98104. A map and directions to the meeting are provided on the back cover of the accompanying proxy statement.
The annual meeting will include a report on our operations and consideration of the matters set forth in the accompanying notice of annual meeting and proxy statement. All shareholders of record as of March 23, 2018 are entitled to vote.
Your vote is important. Whether or not you plan to attend the annual meeting in person, we urge you to please vote as soon as possible. You can vote over the internet, by telephone or by mailing back a proxy card.
On behalf of the Board of Directors, thank you for your continued ownership and support of Weyerhaeuser.
Sincerely,
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Rick R. Holley | Doyle R. Simons | |
Chairman of the Board | President and CEO |
NOTICE OF THE ANNUAL MEETING OF SHAREHOLDERS
2018 ANNUAL MEETING INFORMATION
For additional information about our Annual Meeting, see Information about the Meeting on page 55.
Meeting Date: May 18, 2018 |
Meeting Place: Embassy SuitesPioneer Square 255 South King Street Seattle, WA 98104 |
Meeting Time: 9:00 a.m. (Pacific) |
Record Date: March 23, 2018 | |||||||||
ANNUAL MEETING BUSINESS
Weyerhaeuser Companys annual meeting of shareholders will be held May 18, 2018 to:
● | elect as directors the 11 nominees named in the accompanying proxy statement; |
● | approve, on an advisory basis, the compensation of our named executive officers; |
● | ratify the selection of KPMG LLP as the companys independent registered public accounting firm for 2018; and |
● | transact any other business that may be properly brought before the annual meeting. |
VOTING
Your vote is important. Shareholders owning Weyerhaeuser common stock at the close of business on March 23, 2018, the record date, or their legal proxy holders, are entitled to vote at the annual meeting. Whether or not you expect to attend the annual meeting in person, we urge you to vote as soon as possible by one of these methods:
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Via the Internet: www.envisionreports.com/WY |
Call Toll-Free: 1-800-652-VOTE (8683)
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Mail Signed Proxy Card: Follow the instructions on your proxy card or voting instruction form | ||
If you are a beneficial owner of shares held through a broker, bank or other holder of record, you must follow the voting instructions you receive from the holder of record to vote your shares. Shareholders may also vote in person at the annual meeting. For more information on how to vote your shares, please refer to Voting Matters beginning on page 55. | ||||
Kristy T. Harlan
Senior Vice President, General Counsel and Corporate Secretary
Seattle, Washington
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Shareholders to be Held on May 18, 2018 |
This Notice of the Annual Meeting of Shareholders, our Proxy Statement and our Annual Report to
Shareholders and Form 10-K are available free of charge at www.edocumentview.com/WY.
This summary highlights information contained elsewhere in this proxy statement. This summary does not contain all of the information you should consider before casting your vote. Please read this entire proxy statement carefully before voting.
2018 ANNUAL MEETING INFORMATION
For additional information about our Annual Meeting, see Information about the Meeting on page 55.
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Meeting Date: May 18, 2018 |
Meeting Place: Embassy Suites Pioneer Square 255 South King Street Seattle, WA 98104 |
Meeting Time: 9:00 a.m. (Pacific) |
Record Date: March 23, 2018 | |||
MEETING AGENDA AND VOTING RECOMMENDATIONS
The Weyerhaeuser Company board of directors is asking shareholders to vote on these matters:
Items of Business |
Board Recommendation |
Page Number | ||||
1. |
Election of the 11 directors named as nominees in the proxy statement |
FOR | 13 | |||
2. |
Approval, on an advisory basis, of the compensation of our named executive officers |
FOR | 21 | |||
3. |
Ratification of selection of independent registered public accounting firm |
FOR | 50 |
In addition to the above matters, we will transact any other business that is properly brought before the shareholders at the annual meeting.
ADVANCE VOTING METHODS (page 56)
Even if you plan to attend the 2018 annual meeting of shareholders in person and you are a shareholder of record, we urge you to vote in advance of the meeting using one of these advance voting methods.
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Via the Internet: www.envisionreports.com/WY |
Call Toll-Free: 1-800-652-VOTE (8683) |
Mail Signed Proxy Card: Follow the instructions on your proxy card or voting instruction form | ||
If you are a beneficial owner of shares held through a broker, bank or other holder of record, you must follow the voting instructions you receive from the holder of record to vote your shares.
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DIRECTOR NOMINEES (page 14)
We have included summary information about each director nominee in the table below. Each director is elected annually by a majority of votes. See Nominees for Election beginning on page 14 for more information regarding our director nominees.
COMMITTEES | ||||||||||||||||||
Name and Primary Occupation |
Age | Director Since |
Independent | EC | AC | CC | GCRC | |||||||||||
Mark A. Emmert President, National Collegiate Athletic Association |
65 | 2008 | 🌑 | 🌑 | ||||||||||||||
Rick R. Holley Former Chief Executive Officer, Plum Creek Timber Company, Inc. |
66 | 2016 | 🌑 | |||||||||||||||
Sara Grootwassink Lewis Chief Executive Officer of Lewis Corporate Advisors |
50 | 2016 | 🌑 | Chair | ||||||||||||||
John F. Morgan Sr. Private Timber Investor |
71 | 2016 | 🌑 | 🌑 | ||||||||||||||
Nicole W. Piasecki Former Vice President and General Manager, Propulsion Division, Boeing Commercial Airplanes |
55 | 2003 | 🌑 | 🌑 | Chair | |||||||||||||
Marc F. Racicot Former President and CEO, American Insurance Association and Former Governor, State of Montana |
69 | 2016 | 🌑 | 🌑 | 🌑 | |||||||||||||
Lawrence A. Selzer President and Chief Executive Officer, The Conservation Fund |
58 | 2016 | 🌑 | 🌑 | 🌑 | |||||||||||||
Doyle R. Simons President and Chief Executive Officer, Weyerhaeuser Company |
54 | 2012 | 🌑 | |||||||||||||||
D. Michael Steuert Former CFO, Fluor Corporation |
69 | 2004 | 🌑 | 🌑 | ||||||||||||||
Kim Williams Former Partner and SVP, Wellington Management Company, LLP |
62 | 2006 | 🌑 | 🌑 | 🌑 | |||||||||||||
Charles R. Williamson Former EVP, Chevron Corporation and CEO, Unocal Corporation |
69 | 2004 | 🌑 | Chair | Chair |
EC = Executive Committee AC = Audit Committee CC = Compensation Committee GCRC = Governance and Corporate Responsibility Committee
BOARD COMPOSITION
2018 ANNUAL MEETING & PROXY STATEMENT
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Gender Diversity Women Men Tenure Average: 7 years Independence Independent Directors Non-Independent Directors <5 yrs. 510 yrs. 11+ yrs. 3,8,5,2,4,2,9
CORPORATE GOVERNANCE HIGHLIGHTS (page 7)
Our corporate governance policies and practices promote the long-term interests of our shareholders, strengthen the accountability of our board of directors and management, and help build public trust in the company. Below is a summary of some of the highlights of our corporate governance framework.
BOARD PRACTICES
9 of 11 director nominees are independent
Annual election of all directors
Separation of board chair and CEO
Lead independent director
Regular executive sessions of independent directors
Comprehensive and strategic risk oversight
Mandatory retirement age for directors
Annual board and committee evaluations |
SHAREHOLDER MATTERS
Robust shareholder engagement
Annual say-on-pay voting
Shareholder right to call special meetings
Majority voting for director elections
OTHER GOVERNANCE PRACTICES
Executive and director stock ownership guidelines
Clawback policy
Prohibition on hedging or pledging company stock | |
BUSINESS PERFORMANCE HIGHLIGHTS
Our long- and short-term business and financial performance provides important context for the matters discussed in this proxy statement, particularly our executive compensation programs. Following is a brief snapshot of our financial performance over the three-year and one-year periods completed through 2017, as well as a summary of our significant business achievements in 2017.
Three-Year Performance Highlights
We have generated positive results for our shareholders over a significantly transformational period in our companys history, during which we merged with Plum Creek Timber Company and completed strategic dispositions of our cellulose fibers business and our Uruguay operations.
* | Represents a measure of performance that is calculated and presented other than in accordance with generally accepted accounting principles (GAAP). See Appendix A for an explanation of these non-GAAP measures, a full reconciliation of these non-GAAP results to our GAAP Net Earnings results, and a brief discussion of why we use these non-GAAP performance measures. |
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REVENUE INCREASED BY 37% WE INCREASED FULL YEAR ADJUSTED EBITDA BY OVER 100% TO NEARLY $2.1 BILLION* RETURNED NEARLY $2.5 BILLION IN DIVIDENDS TO OUR COMMON SHAREHOLDERS REVENUE INCREASED BY 11.6% IN THE LAST YEAR 2016 $6.365B 2017 $7.196B WE INCREASED FULL YEAR ADJUSTED EBITDA BY APPROXIMATELY $500 MILLION* (over 30% increase) 2016 $1.583B 2017 $2.081B WE RETURNED OVER $941 MILLION IN DIVIDENDS TO OUR COMMON SHAREHOLDERS IN THE LAST YEAR $5.246B 2015 $6.365B 2016 $7.196B 2017 $1.025B 2015 $1.583B 2016 $2.078B 2017$1.20 2015 $1.24 2016 $1.25 2017 Annual Per-share common dividend
2017 Business Achievements
2017 was a very strong year for Weyerhaeuser, as we successfully completed our merger integration with Plum Creek, further focused our portfolio, delivered improved financial performance across all our businesses, and returned cash to shareholders by increasing our dividend. Going forward, we remain relentlessly focused on improving performance through operational excellence, fully capitalizing on market conditions, and driving value for shareholders through disciplined capital allocation.
Our Significant Accomplishments in 2017 Include:
Financial Results
● We generated net earnings of $582 million, or $872 million before special items* on net sales of approximately $7.2 billion.
● We increased full year Adjusted EBITDA by approximately 32% to nearly $2.1 billion*
● Our one-year total shareholder return (TSR) was over 20%, which was the 54th percentile compared to the TSR of the S&P 500 over the same period.
Strategic Initiatives
● We exceeded our 2017 operational excellence targets, achieving $137 million in improvements.
● We completed the integration of Plum Creek, exceeding our $100 million synergy savings goal by 25%.
● We completed the strategic disposition of our Uruguay operations. |
Shareholder Returns
● We increased our dividend to $0.32 per share consistent with our commitment to a growing and sustainable dividend.
● We returned over $941 million to common shareholders through dividends.
Stakeholder Recognitions
● We were named to the Dow Jones Sustainability World Index for the seventh straight year.
● We were named one of the Worlds Most Ethical Companies® by the Ethisphere Institute for the sixth year in a row.
● We were named among the Top 250 most effectively managed companies by The Wall Street Journal. | |||||
* | Represents a measure of performance that is calculated and presented other than in accordance with generally accepted accounting principles (GAAP). See Appendix A for an explanation of these non-GAAP measures, a full reconciliation of these non-GAAP results to our GAAP Net Earnings results, and a brief discussion of why we use these non-GAAP performance measures. |
2018 ANNUAL MEETING & PROXY STATEMENT
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CEO COMPENSATION MIX Long-Term Incentive Plan 29% RSU 10% Base Salary 15% Annual Incentive 46% PSU 61% Performance Based NEO COMPENSATION MIX Long-Term Incentive Plan 24% RSU 21% Base Salary 18% Annual Incentive Plan 37% PSU 24% RSU 55% Performance Based
COMPENSATION HIGHLIGHTS (page 24)
Our compensation programs are designed to both attract and retain top-level executive talent and align the long- and short-term interests of our executives with those of our shareholders. We received more than 97% shareholder support for our Say-on-Pay vote in 2017, which our Compensation Committee considers to be among the most important items of feedback about our pay program. We recognize and reward our executive officers through compensation arrangements that directly link their pay to the companys performance, and we ensure a strong alignment of interests with our shareholders by including a significant amount of equity in the overall mix of pay. Our pay mix includes base salary, an annual incentive cash bonus plan (AIP), a long-term incentive performance share unit plan (PSU) and a long-term incentive and retention grant of restricted stock units (RSU).
CEO COMPENSATION MIX | NEO COMPENSATION MIX | |
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KEY FEATURES OF OUR EXECUTIVE COMPENSATION PROGRAM (page 25)
● | Total compensation opportunities are maintained at or near the median of market-competitive levels based on targeted benchmarking. |
● | We include short-term incentives in executive pay through our AIP bonus plan, which measures company performance over a one-year period based on achievement of rigorous pre-determined financial and individual business goals. |
● | Our long-term incentives measure performance over a three-year period based on our total shareholder return relative to that of the S&P 500 composite and our industry peers. |
● | Our annual grant of RSUs, which vest over a four-year period and accrue additional stock equivalent units as we pay dividends to our shareholders, serves as a strong retention tool and also provides incentive for our executives to maintain a sustainable and growing dividend policy for our shareholders. |
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CORPORATE GOVERNANCE AT WEYERHAEUSER
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CORPORATE GOVERNANCE AT WEYERHAEUSER
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CORPORATE GOVERNANCE AT WEYERHAEUSER
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CORPORATE GOVERNANCE AT WEYERHAEUSER
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ITEM 1. ELECTION OF DIRECTORS
The 11 persons identified below are nominated to be elected as directors at the 2018 annual meeting for one-year terms expiring at the 2019 annual meeting. All of the nominees were elected as directors by shareholders at the 2017 annual meeting for a one-year term expiring at the 2018 annual meeting.
Unless a shareholder instructs otherwise on the proxy card, it is intended that the shares represented by properly executed proxies will be voted for the persons nominated by the board of directors. The board of directors anticipates that the listed nominees will be able to serve, but if at the time of the meeting any nominee is unable or unwilling to serve, the proxy holders may vote such shares at their discretion for a substitute nominee.
The biography of each of the nominees below contains information regarding the individuals service as a director, business experience, director positions held currently or at any time during the last five years, and information regarding their experiences, qualifications, attributes or skills considered by the Governance and Corporate Responsibility Committee and the board of directors to assess the nominees candidacy for nomination.
Significant Leadership Experience Six nominees have prior experience as a |
Manufacturing or Capital-Intensive Industry Six nominees have a business background | |||||||
Real Estate & Land Management Five nominees have experience in the real estate and land management business. |
Government, Regulatory & Legal Six nominees have a government, regulatory or legal background. | |||||||
Public Company Board Experience Eight nominees have experience serving on other public company boards. |
Finance & Capital Markets Eight nominees have experience in finance and capital markets. | |||||||
Timber & Forest Products Seven nominees have experience in the timber and forest products industry. |
International Business Six nominees have experience in international business operations. |
The board of directors recommends that shareholders vote FOR the election of each of the following directors. |
2018 ANNUAL MEETING & PROXY STATEMENT
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ITEM 1. ELECTION OF DIRECTORS
MARK A. EMMERT
Age: 65
Director Since: 2008 |
Biographical Information: Mark A. Emmert has been the president of the National Collegiate Athletic Association since 2010. He served as president of the University of Washington in Seattle, Washington, from 2004 to 2010; as chancellor of Louisiana State University from 1999 to 2004; and chancellor and provost of the University of Connecticut from 1994 to 1999. Prior to 1994, he was provost and vice president for Academic Affairs at Montana State University and held faculty and administrative positions at the University of Colorado. He also is a director of Expeditors International of Washington, Inc. (global logistics services). He previously served on the board of directors of Omnicare, Inc. (healthcare services) until 2015.
Qualifications: Mr. Emmert is a Life Member of the Council on Foreign Relations and is a Fellow of the National Academy of Public Administration. He has also been a Fulbright Fellow, a Fellow of the American Council on Education and served on many non-profit boards. He is an experienced leader of major organizations, with strong skills in government and international relations, strategic planning and public company executive compensation.
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RICK R. HOLLEY
Age: 66
Director Since: 2016 |
Biographical Information: Rick R. Holley was the president and chief executive officer of Plum Creek from 1994 to 2013 and continued to serve as chief executive officer until February 2016. From 1989 to 1994, Mr. Holley served as Plum Creeks chief financial officer. He previously served on the board of directors of Avista Corporation (electric and natural gas utility) until 2014 and as a director and chairman of the board of Plum Creek (timber) until February 2016.
Qualifications: Mr. Holley, one of the longest tenured chief executive officers in the timber industry, has a deep and broad understanding of the companys industry and business lines, as well as experience in strategic planning and finance.
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SARA GROOTWASSINK LEWIS
Age: 50
Director Since: 2016 |
Biographical Information: Sara Grootwassink Lewis founded, and is the chief executive officer of, Lewis Corporate Advisors (capital markets advisory firm). From 2002 to 2009, she was chief financial officer of Washington Real Estate Investment Trust Company (equity real estate investment trust). Ms. Grootwassink Lewis also serves on the board of directors of PS Business Parks, Inc. (commercial real estate), and Sun Life Financial Inc. (global financial services). She previously served on the board of directors of CapitalSource, Inc. (commercial lending) from 2004 until its acquisition in 2014, Plum Creek (timber) until February 2016 and Adamas Pharmaceuticals, Inc. (specialty pharmaceuticals) until June 2016.
Qualifications: Ms. Grootwassink Lewis is a member of the board of trustees of The Brookings Institution and the leadership board of the United States Chamber of Commerce Center for Capital Markets Competitiveness, and a former member of the Public Company Accounting Oversight Board Standing Advisory Group from 2015-2017. Ms. Grootwassink Lewis has extensive executive, financial and real estate industry experience, having served as a senior executive of a publicly traded REIT as well as service on several public company boards. Ms. Grootwassink Lewis also holds a chartered financial analyst designation.
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ITEM 1. ELECTION OF DIRECTORS
JOHN F. MORGAN SR.
Age: 71
Director Since: 2016 |
Biographical Information: John F. Morgan Sr. has owned and managed Morgan Timber, LLC (a private timberland and real estate management and development company) since 2001. He has also owned and managed South Coast Commercial, LLC (a real estate investment firm) since 2009. Mr. Morgan previously held positions in general banking and public securities investment management at First Orlando Corporation (Sun Trust) from 1969 to 1972 and Citizens & Southern Corporation (Bank of America) from 1973 to 1978. He later helped found INVESCO Capital Management (global money management), where he served from 1979 to 2000. He previously served on the board of directors of Plum Creek (timber) until February 2016 and Post Properties, Inc. (equity real estate investment trust) until its merger in December 2016.
Qualifications: Mr. Morgan has extensive experience in the timber industry, as well as in banking, finance and capital markets.
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NICOLE W. PIASECKI
Age: 55
Director Since: 2003 |
Biographical Information: Nicole W. Piasecki served as vice president and general manager of the Propulsion Systems Division of Boeing Commercial Airplanes from March 2013 to September 2017. Previously, she served as vice president of Business Development & Strategic Integration for Boeing Commercial Airplanes from 2010 to March 2013; president of Boeing Japan from 2006 to 2010; vice president of Business Strategy & Marketing for Boeing Commercial Airplanes from 2003 to 2006; vice president of Sales, Leasing Companies, for Boeing Commercial Airplanes from 2000 until January 2003; and served in various positions in engineering, sales, marketing, and business strategy for the Commercial Aircraft Group since 1992. She is the vice chair of the board of trustees of Seattle University in Seattle, Washington, a former director on the Seattle Branch board of directors for the Federal Reserve Bank, and a former member of the board of governors, Tokyo, of the American Chamber of Commerce of Japan, and the Federal Aviations Administration Advisory Council.
Qualifications: Ms. Piasecki has extensive executive experience in capital-intensive industries, sales and marketing, strategic planning and international operations and relations.
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MARC F. RACICOT
Age: 69
Director Since: 2016 |
Biographical Information: Marc F. Racicot is an attorney and served as president and chief executive officer of the American Insurance Association (property-casualty insurance trade organization) from 2005 until 2009. From 2001 to 2005, he was an attorney at the law firm of Bracewell & Giuliani, LLP. He is a former Governor (1993 to 2001) and Attorney General (1989 to 1993) of the state of Montana. Mr. Racicot was appointed by President Bush to serve as the chairman of the Republican National Committee from 2002 to 2003, and he served as chairman of the Bush/Cheney Re-election Committee from 2003 to 2004. He presently serves on the board of directors of Avista Corporation (electric and natural gas utility) and Massachusetts Mutual Life Insurance Company (insurance). He previously served on the board of directors of Plum Creek (timber) until February 2016.
Qualifications: Mr. Racicot has extensive experience in government and the interaction between government and large, complex business organizations. As an experienced lawyer, he also has valuable skill and background in the areas of regulatory and operational risk oversight.
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2018 ANNUAL MEETING & PROXY STATEMENT
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ITEM 1. ELECTION OF DIRECTORS
LAWRENCE A. SELZER
Age: 58
Director Since: 2016 |
Biographical Information: Lawrence A. Selzer has served as the president and chief executive officer of The Conservation Fund (one of the nations premiere environmental non-profit organizations) since 2001. He is the chairman of the board of directors of American Bird Conservancy and a member of the board of trustees of Manomet. He previously served on the board of directors of Plum Creek (timber) until February 2016 and as chairman of the board of directors of Outdoor Foundation from 2007 until 2016.
Qualifications: Mr. Selzer has experience and expertise in the areas of conservation procurement, conservation finance, land acquisition and disposition, and real estate management. He has experience managing and overseeing a large, complex, and geographically diverse environmental conservation organization.
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DOYLE R. SIMONS
Age: 54
Director Since: 2012 |
Biographical Information: Doyle R. Simons has been president and chief executive officer of the company since August 2013 and a director of the company since June 2012. He had been previously appointed chief executive officer-elect and an executive officer of the company in June 2013. He served as chairman and chief executive officer of Temple-Inland, Inc. (forest products) from 2008 until February of 2012 when it was acquired by International Paper Company. Previously, he held various management positions with Temple-Inland, including executive vice president from 2005 through 2007 and chief administrative officer from 2003 to 2005. Prior to joining Temple-Inland in 1992, he practiced real estate and banking law with Hutcheson and Grundy, L.L.P. He also serves on the board of directors for Fiserv, Inc. (financial services technology).
Qualifications: Mr. Simons has extensive experience in managing forest products companies and capital-intensive industries, with strong skills in corporate finance, executive compensation and strategic planning.
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D. MICHAEL STEUERT
Age: 69
Director Since: 2004 |
Biographical Information: D. Michael Steuert was senior vice president and chief financial officer for Fluor Corporation (engineering and construction) from 2001 until his retirement in 2012. He served as senior vice president and chief financial officer at Litton Industries Inc. (defense electronics, ship construction and electronic technologies) from 1999 to 2001 and as a senior officer and chief financial officer of GenCorp Inc. (aerospace, propulsion systems, vehicle sealing systems, chemicals and real estate) from 1990 to 1999. He also serves as a director of LNG Ltd. (owner and developer of liquefied natural gas projects) and Great Lakes Dredge & Dock Corporation (dock and dredging infrastructure solutions). He previously served on the board of directors of Prologis, Inc., (industrial real estate) until 2015.
Qualifications: Mr. Steuert was formerly a member of the National Financial Executives Institute and the Carnegie Mellon Council on finance. He has extensive executive experience in corporate finance and accounting, managing capital-intensive industry operations, natural resources development and strategic planning.
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ITEM 1. ELECTION OF DIRECTORS
KIM WILLIAMS
Age: 62
Director Since: 2006 |
Biographical Information: Kim Williams was senior vice president and associate director of global industry research for Wellington Management Company LLP (investment management) from 2001 to 2005, was elected a partner effective in 1995 and held various management positions with Wellington from 1986 to 2001. Prior to joining Wellington, she served as vice president, industry analyst for Loomis, Sayles & Co., Inc (investment management) from 1982 to 1986. She is also a director of E.W. Scripps Company (diverse media), Xcel Energy Inc. (utilities), and MicroVest (asset management firm). She is a member of the Womens Health Leadership Council of Brigham and Womens Hospital in Boston, Massachusetts, a member of the board of Oxfam America (global antipoverty agency), and president of the board of trustees of Concord Academy, Concord, Massachusetts.
Qualifications: Ms. Williams has extensive experience in corporate finance, strategic planning and international operations.
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CHARLES R. WILLIAMSON
Age: 69
Director Since: 2004 |
Biographical Information: Charles R. Williamson was the executive vice president of Chevron Corporation (international oil and gas) from mid-2005 until his retirement in December 2005. Mr. Williamson served as Weyerhaeusers chairman of the board from 2009 until February 2016. He was chairman and chief executive officer of Unocal Corporation (oil and natural gas) until its acquisition by Chevron Corporation in 2005. He served as Unocal Corporations executive vice president, International Energy Operations, from 1999 to 2000; group vice president, Asia Operations, from 1998 to 1999; group vice president, International Operations from 1996 to 1997. He is also lead director of PACCAR Inc. (manufacturer of high-quality trucks) and is a director of Greyrock Energy (gas transformation). Mr. Williamson previously served as a director and chairman of the board of Talisman Energy Inc. (oil and gas) until 2015.
Qualifications: Mr. Williamson has extensive executive experience in corporate finance, management of capital-intensive operations, development of natural resources, technology, international operations, strategic planning and public company executive compensation.
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ITEM 1. ELECTION OF DIRECTORS
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ITEM 1. ELECTION OF DIRECTORS
BOARD AND COMMITTEE MEETINGS IN 2017
The following table summarizes meeting information for the board and each of the boards committees in 2017. In 2017, each of the directors attended at least 75% of the total meetings of the board and the committees on which he or she served.
Name |
Board of Directors |
Executive | Audit | Compensation | Governance and Corporate Responsibility | ||||||||||||||||||||
Total meetings in 2017
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5 | | 7 | 4 | 3 |
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ITEM 1. ELECTION OF DIRECTORS
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EXECUTIVE COMPENSATION
COMPENSATION DISCUSSION AND ANALYSIS (CD&A)
Introduction
This Compensation Discussion and Analysis explains the process that the Compensation Committee uses to determine compensation and benefits for the companys principal executive officer, principal financial officer, and our three other most highly compensated executive officers who were serving as executive officers on December 31, 2017 (collectively, the named executive officers or NEOs) and provides a detailed discussion about those programs. For 2017, our NEOs are:
Name
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Title
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Doyle R. Simons
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President and Chief Executive Officer
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Russell S. Hagen
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Senior Vice President and Chief Financial Officer
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Adrian M. Blocker
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Senior Vice President, Wood Products
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Rhonda D. Hunter
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Senior Vice President, Timberlands
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James A. Kilberg
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Senior Vice President, Real Estate, Energy & Natural Resources
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CD&A Table of Contents
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EXECUTIVE COMPENSATION
Weyerhaeusers executive compensation programs are designed to align the interests of our executive officers with those of our shareholders. Our compensation philosophy is to provide market-competitive programs that ensure we attract and retain world-class talent, with pay directly linked to the achievement of short- and long-term business results. The Compensation Committee reviews executive compensation program components, targets and payouts on an annual basis to ensure the strength of our pay-for-performance alignment.
2017 Business and Performance Highlights
2017 was a very strong year for Weyerhaeuser, as we successfully completed our merger integration, further focused our portfolio and delivered improved financial performance across all our businesses. We generated net earnings of $582 million, or $872 million before special items*, on net sale of approximately $7.2 billion. Our total shareholder return (TSR) for 2017 was over 20% (54th percentile of the S&P 500), and we increased our dividend to $0.32 per share consistent with our commitment to a growing and sustainable dividend.
Executive Compensation Practices
Our leading practices include:
● Stock ownership guidelines for the CEO (six times salary) and senior vice presidents (two times salary). Senior officers who have not yet accumulated the required ownership level must hold 75% of the net shares remaining after vesting of restricted stock units (RSUs) and performance share units (PSUs).
● An executive compensation program designed and managed to mitigate undue risk.
● A clawback policy for incentive compensation recovery.
● A policy prohibiting hedging and pledging of company stock by directors and officers. |
● An independent compensation consultant, Frederic W. Cook & Co., Inc. (FW Cook), which advises the Compensation Committee.
● Double trigger accelerated vesting of our long-term incentive equity awards upon a change in control.
● No executive perquisites other than limited relocation-related benefits.
● No tax gross ups for golden parachute excise taxes.
● No repricing of stock options.
● Annual review of all of our compensation programs to ensure they do not encourage inappropriate risk-taking.
| |||||
* | Represents a measure of performance that is calculated and presented other than in accordance with generally accepted accounting principles (GAAP). See Appendix A for an explanation of these non-GAAP measures, a full reconciliation of these non-GAAP results to our GAAP Net Earnings results, and a brief discussion of why we use these non-GAAP performance measures. |
2018 ANNUAL MEETING & PROXY STATEMENT
|
23
|
REVENUE INCREASED BY 11.6% IN THE LAST YEAR 2016 $6.365B 2017 $7.196B WE INCREASED FULL YEAR ADJUSTED EBITDA BYAPPROXIMATELY $500 MILLION* (over 30% increase) 2016 $1.583B 2017 $2.081B WE RETURNED OVER $941 MILLION IN DIVIDENDS TO OUR COMMON SHAREHOLDERS IN THE LAST YEAR
EXECUTIVE COMPENSATION
24
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WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
To provide a competitive overall compensation and benefits package that is tied to creating shareholder value and that supports the execution of our business strategies, we use a range of compensation components. The combination and the amount of each component are influenced by the role of the executive in the company, market data, and the total value of all the compensation and benefits available to the executive. Following is a summary of our compensation program for executive officers for 2017.
Element
|
Objectives and Basis
|
Form
| ||
Base salary |
Provide a minimum fixed level of compensation that is competitive for each role
|
Cash | ||
Annual cash incentives |
Annual incentive to drive company, business unit and individual performance
|
Cash | ||
Long-term incentives |
Long-term incentive to drive company performance, align executives interests with shareholders interests, and retain executives through long-term vesting and potential wealth accumulation
|
PSUs and RSUs | ||
Special bonuses |
Reward extraordinary performance and attract and retain top talent for key roles within the organization
|
Cash or equity | ||
Retirement benefits |
Provide means to save for retirement |
Participation in tax-qualified and non-qualified defined benefit and defined contribution plans
| ||
Deferred compensation benefits
|
Allow executives to defer compensation on a tax-efficient basis |
Eligibility to participate in a deferred compensation plan | ||
Medical and other benefits
|
Provide competitive benefits package that includes benefits offered to all employees
|
Health and welfare plans, and other
| ||
2018 ANNUAL MEETING & PROXY STATEMENT
|
25
|
EXECUTIVE COMPENSATION
We seek to accomplish our executive compensation goals through an appropriate mix of short-term and long-term compensation, by providing a larger percentage of our executive officers total compensation opportunity in the form of equity compensation, and by ensuring that a significant portion of our executive officers total pay opportunity is in the form of performance-based compensation.
The following charts illustrate 2017 target compensation for Mr. Simons and an average for all other NEOs by type of compensation. A significant portion (approximately 61% and 55%, respectively) of the total target compensation of our CEO and our NEOs is performance-based.
CEO COMPENSATION MIX | NEW COMPENSATION MIX | |
|
||
26
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WEYERHAEUSER COMPANY
|
CEO COMPENSATION MIX Long-Term Incentive Plan 29% RSU 10% Base Salary 15% Annual Incentive 46% PSU 61% Performance Based NEO COMPENSATION MIX Long-Term Incentive Plan 24% RSU 21% Base Salary 18% Annual Incentive Plan 37% PSU 24% RSU 55% Performance Based
EXECUTIVE COMPENSATION
2018 ANNUAL MEETING & PROXY STATEMENT
|
27
|
EXECUTIVE COMPENSATION
28
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WEYERHAEUSER COMPANY
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EXECUTIVE COMPENSATION
2018 ANNUAL MEETING & PROXY STATEMENT
|
29
|
EXECUTIVE COMPENSATION
For 2017, the Compensation Committee set a combined Adjusted EBITDA target for the Timberlands and Real Estate, Energy & Natural Resources businesses and a RONA target for the Wood Products business at the following levels:
Metric | Threshold (20% of Target Funding) |
Target (100% of Target Funding) |
Maximum (200% of Target Funding) |
|||||||||||
Timberlands and Real Estate, Energy & Natural Resources |
Adjusted EBITDA | $ | 912 million | $ | 1,141 million | $ | 1,426 million | |||||||
Wood Products |
RONA | 6% | 12% | 22% |
Controllable Business Metrics
The remainder of the AIP funding determination (30%) is based on the performance of each business against certain controllable business metrics approved in advance by the Compensation Committee. The controllable business metrics measure performance against achievement of the companys vision in areas such as operational excellence and people development, financial and competitive performance, cost competitiveness and performance against strategic goals and priorities.
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EXECUTIVE COMPENSATION
AIP Funding Illustration
Individual AIP awards are calculated as follows:
2018 ANNUAL MEETING & PROXY STATEMENT
|
31
|
Base Salary Target AIP Opportunity Percentage Business Performance Funding Multiple Individual Performance Adjustment Individual AIP Award
EXECUTIVE COMPENSATION
For 2017, AIP funding multiples were as follows:
FINANCIAL PERFORMANCE METRICS
|
CONTROLLABLE BUSINESS METRICS
|
|||||||||||||||||||||||
Business (Financial Measure) |
2017 Financial Results |
Funding Multiple (A) |
2017 Results |
Funding Multiple (B) |
2017 Total Business |
|||||||||||||||||||
Timberlands (1) |
$ | 1,177 million | 0.79 | Exceeds | 0.60 | 1.39 | ||||||||||||||||||
Real Estate, Energy & Natural Resources (1) |
$ | 1,177 million | 0.79 | Exceeds | 0.60 | 1.39 | ||||||||||||||||||
Wood Products (2) (4) |
33% | 1.40 | High Achieves | | 1.40 | |||||||||||||||||||
Chief Executive Officer, Chief Financial Officer and other corporate functions (3) (4) |
N/A | 1.03 | N/A | 0.36 | 1.39 |
(1) | Based on a combined Adjusted EBITDA for Timberlands and Real Estate, Energy & Natural Resources. |
(2) | Based on segment RONA. |
(3) | Based on performance of Timberlands, Real Estate, Energy & Natural Resources, and Wood Products (weighted for each segment at 40%, 20% and 40%, respectively). |
(4) | Although the Wood Products business delivered high achieves performance for its controllable business metrics, consistent with the companys focus on pay for performance, the Compensation Committee at the recommendation of management exercised its discretion to reduce the funding multiple due to a product remediation matter. |
AIP bonus targets and actual payout amounts for our NEOs in 2017 were:
Named Executive Officer |
Target Bonus (% of Base Salary) |
Target Bonus Amount ($) [A] |
Business Funding |
Individual Performance Adjustment ($) [C] |
2017 Bonus Earned ($) [ ( A x B ) + C ] |
2017 Bonus Earned (% of Target) |
||||||||||||||||||
Doyle R. Simons |
150 | % | $ | 1,500,000 | 1.39 | $ | 515,000 | $ | 2,600,000 | 173 | % | |||||||||||||
Russell S. Hagen |
85 | % | $ | 484,500 | 1.39 | $ | 151,545 | $ | 825,000 | 170 | % | |||||||||||||
Adrian M. Blocker |
85 | % | $ | 484,500 | 1.40 | $ | 0 | $ | 679,000 | 140 | % | |||||||||||||
Rhonda D. Hunter |
85 | % | $ | 484,500 | 1.39 | $ | 151,545 | $ | 825,000 | 170 | % | |||||||||||||
James A. Kilberg |
85 | % | $ | 460,700 | 1.39 | $ | 0 | $ | 641,000 | 139 | % |
The AIP bonus for each of Messrs. Simons, Hagen, Blocker and Kilberg and Ms. Hunter was above target because the business funding multiple applicable to their respective AIP opportunities exceeded target based on business performance, and for Messrs. Simons and Hagen and Ms. Hunter, because they met or exceeded pre-established goals for their respective individual performance adjustments. The 2017 business funding multiple for Mr. Simons was 1.39 based on the performance of the Timberlands, Real Estate, Energy & Natural Resources and Wood Products segments, and the Committee recognized his continued strong leadership in developing key strategic initiatives for the company and for driving operational excellence and people development throughout the organization. The 2017 business funding multiple for Mr. Hagen was 1.39 based on the performance of the Timberlands, Real Estate, Energy & Natural Resources and Wood Products segments, and the Committee recognized his leadership in executing key portfolio management projects, including the divestiture of the companys Uruguay operations and the divestiture of its investment in the Twin Creeks Timber joint venture. The 2017 business funding multiple for Ms. Hunter was 1.39 based on the performance of the Timberlands segment, and the Committee recognized her leadership in driving operational excellence results and completing a successful integration of the Weyerhaeuser and Plum Creek timberlands organizations. The 2017 business funding multiple for Mr. Blocker was 1.40 based on the performance of the Wood Products segment, and the 2017 business funding multiple for Mr. Kilberg was 1.39 based on the performance of the Real Estate, Energy & Natural Resources segment. Generally, total earned bonuses are rounded up to the nearest $1,000.
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|
EXECUTIVE COMPENSATION
2018 ANNUAL MEETING & PROXY STATEMENT
|
33
|
EXECUTIVE COMPENSATION
For 2017, 60% of the target value of the long-term incentive awards were granted in the form of PSUs and 40% of the value of the long-term incentive awards were granted in the form of RSUs.
RESTRICTED STOCK UNITS
40% |
PERFORMANCE SHARE UNITS
60% | |||||
● Alignment with shareholders
● Facilitates share ownership
● Strong retention vehicle |
● Tied to achievement of long term operational objectives
● Facilitates share ownership
● Alignment with shareholders
● Strong retention vehicle |
Shares earned will range from 0% to 150% of the target number of PSUs based on the companys 3-year TSR performance relative to S&P 500 and designated industry peer group. | ||||
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WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
2018 ANNUAL MEETING & PROXY STATEMENT
|
35
|
EXECUTIVE COMPENSATION
36
|
WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
2018 ANNUAL MEETING & PROXY STATEMENT
|
37
|
EXECUTIVE COMPENSATION
The following tables set forth information regarding 2017 compensation for each of our 2017 NEOs. Compensation for 2016 and 2015 is presented for the executive officers who were also NEOs in 2016 and 2015. The Summary Compensation Table and the Grants of Plan-Based Awards for 2017 table should be reviewed together for a more complete presentation of both the annual and long-term incentive compensation elements of our compensation program.
Name and Principal Position
|
Year
|
Salary (1)($)
|
Bonus ($)
|
Stock Awards (2)($)
|
Option Awards (3)($)
|
Non-Equity Plan Compensation (4)($)
|
Change in Pension Value and Nonqualified Deferred Compensation Earnings (5)($)
|
All Other Compensation (6)($)
|
Total ($)
| ||||||||||||||||||||||||||||||||||||
Doyle R. Simons
President and Chief
Executive Officer
|
|
2017
2016
2015
|
|
|
1,000,000
1,000,000
987,500
|
|
|
|
|
|
7,561,434
5,120,233
4,265,369
|
|
|
1,581,847
1,420,491
|
|
|
2,600,000
2,400,000
1,950,000
|
|
|
278,173
228,934
150,153
|
|
|
8,100
7,950
7,950
|
|
|
11,447,707
10,338,963
8,781,463
|
| ||||||||||||||||||
Russell S. Hagen
Senior Vice President
and Chief Financial Officer
|
|
2017
2016 |
|
|
564,615
434,201 |
|
|
25,547 |
|
|
1,628,110
1,004,056 |
|
|
|
|
|
825,000
723,000 |
|
|
247,722
207,631 |
|
|
103,508
80,649 |
|
|
3,368,955
2,475,084 |
| ||||||||||||||||||
Adrian M. Blocker
Senior Vice President,
Wood Products
|
|
2017
2016
2015
|
|
|
570,000
560,000
520,962
|
|
|
|
|
|
1,628,110
1,132,023
1,021,460
|
|
|
349,710
340,172
|
|
|
679,000
891,000
779,000
|
|
|
186,590
167,579
113,261
|
|
|
8,100
7,950
25,450
|
|
|
3,071,800
3,108,262
2,800,305
|
| ||||||||||||||||||
Rhonda D. Hunter
Senior Vice President,
Timberlands
|
|
2017
2016
2015
|
|
|
570,000
560,000
522,500
|
|
|
|
|
|
1,628,110
1,132,023
1,021,460
|
|
|
349,710
340,172
|
|
|
825,000
758,000
682,000
|
|
|
1,183,770
988,172
613,801
|
|
|
8,100
59,100
7,950
|
|
|
4,214,980
3,847,005
3,187,883
|
| ||||||||||||||||||
James Kilberg
Senior Vice President,
Real Estate, Energy &
Natural Resources
|
|
2017
2016 |
|
|
542,000
428,778 |
|
|
27,382 |
|
|
1,577,236
974,810 |
|
|
|
|
|
641,000
627,000 |
|
|
53,358
43,748 |
|
|
97,169
634,499 |
|
|
2,910,763
2,736,217 |
|
(1) | Amounts reflect the dollar amount of base salary paid in cash in the fiscal year. |
(2) | Amounts reflect the grant date fair value of RSU and PSU awards granted under the companys long-term incentive plans computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718. Details regarding 2017 stock awards can be found in the table Grants of Plan-Based Awards for 2017. Details regarding outstanding stock awards can be found in the table Outstanding Equity Awards At 2017 Fiscal Year End. The calculation of the grant date fair value for the 2016 PSUs, which included a company performance condition, was based in part upon the probable outcome of the performance conditions on the grant date. The value of the 2016 PSU grant, assuming achievement of the maximum performance levels, would be as follows: Mr. Simons$5,051,379; Mr. Hagen$1,506,083; Mr. Blocker$1,116,790; Ms. Hunter$1,116,790); and Mr. Kilberg$1,462,215. For more information regarding these awards and the calculation of their fair value, refer to companys disclosure in its Annual Report for the year ended December 31, 2017, Part II, Item 8, Notes to Consolidated Financial StatementsNote 16 Share-Based Compensation. |
(3) | Amounts reflect the grant date fair value of stock option awards granted under the companys long-term incentive plans computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718. For more information regarding these stock option awards and the calculation of their fair value, refer to companys disclosure in its Annual Report for the year ended December 31, 2017, Part II, Item 8, Notes to Consolidated Financial StatementsNote 16 Share-Based Compensation. The company discontinued granting stock options beginning in 2017. Details regarding outstanding stock option awards can be found in the table Outstanding Equity Awards At 2017 Fiscal Year End. |
(4) | Amounts represent the value of the annual cash incentive awards earned under the companys annual incentive plan based on the companys performance and the performance of the companys businesses and individual NEOs against performance goals set by the Compensation Committee of the board of directors. These performance goals are described in Compensation Discussion and AnalysisCompensation ComponentsDetermination of CompensationShort-Term Incentive PlanAIP Performance Measures and Plan Mechanics above. |
(5) | Amounts represent annual changes in the actuarial present value of accumulated pension benefits. |
(6) | Amounts under All Other Compensation for each of the NEOs are described in the following table: |
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|
WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
Summary Compensation Table All Other Compensation
Name
|
Year
|
Company Contribution Contribution ($)
|
Premium
|
Other ($)
|
Total ($)
|
|||||||||||||||
Doyle R. Simons |
|
2017
2016
2015
|
|
|
8,100
7,950
7,950
|
|
|
|
|
|
|
|
|
8,100
7,950
7,950
|
| |||||
Russell S. Hagen |
|
2017
2016
|
|
|
73,758
35,513
|
(1)
|
|
|
|
|
29,750
45,136
|
(2)
|
|
103,508
80,649
|
| |||||
Adrian M. Blocker |
|
2017
2016
2015
|
|
|
8,100
7,950
7,950
|
|
|
|
|
|
17,500
|
|
|
8,100
7,950
25,450
|
| |||||
Rhonda D. Hunter |
|
2017
2016
2015
|
|
|
8,100
7,950
7,950
|
|
|
51,150
|
|
|
|
|
|
8,100
59,100
7,950
|
| |||||
James A. Kilberg |
|
2017
2016
|
|
|
67,919
34,953
|
(1)
|
|
|
|
|
29,250
599,546
|
(2)
|
|
97,169
634,499
|
|
(1) | For Mr. Hagen, amount includes a non-elective company contribution of $13,500 and matching contribution of $8,100 to the 401(k) Plan and a non-elective company contribution of $52,158 to the Supplemental DC Plan. For Mr. Kilberg, amount includes a non-elective contribution of $13,500 and matching contribution of $8,100 to the 401(k) Plan and a non-elective contribution of $46,319 to the Supplemental DC Plan. See discussion under Compensation Discussion and AnalysisOther BenefitsSupplemental Retirement Plan and Supplemental DC Plan for more information. |
(2) | Amount represents cash dividends paid on unvested RSU awards previously granted to Messrs. Hagen and Kilberg while employed by Plum Creek and assumed by the company in connection with the Plum Creek merger. |
2018 ANNUAL MEETING & PROXY STATEMENT
|
39
|
EXECUTIVE COMPENSATION
Grants of Plan-Based Awards for 2017
The following table provides information for each of our NEOs regarding 2017 annual and long-term incentive award opportunities, including the range of potential payouts under non-equity and equity incentive plans. Specifically, the table presents the 2017 grants of annual incentive, PSU and RSU awards.
Estimated Future Payout Under Non-Equity Plan Awards |
Estimated Future Payouts Under Equity Plan Awards |
|||||||||||||||||||||||||||||||||||||||||||||||||
Name
|
Type
|
Grant
|
Thres-
|
Target ($)
|
Maximum
|
Thres- (#)
|
Target (#)
|
Maximum
|
Stock (#)
|
Option No. of Securities Under- (#)
|
Exercise ($/Sh)
|
Grant ($/Sh)
|
Grant Date Fair Option ($)
|
|||||||||||||||||||||||||||||||||||||
Doyle R. Simons |
AIP
|
|
2/10/2017
|
|
|
300,000
|
|
|
1,500,000
|
|
|
4,500,000
|
|
|||||||||||||||||||||||||||||||||||||
PSU
|
|
2/10/2017
|
|
|
30,247
|
|
|
120,989
|
|
|
181,484
|
|
|
4,589,113
|
| |||||||||||||||||||||||||||||||||||
RSU
|
|
2/10/2017
|
|
|
90,661
|
|
|
2,972,321
|
| |||||||||||||||||||||||||||||||||||||||||
Russell S. Hagen |
AIP
|
|
2/09/2017
|
|
|
96,900
|
|
|
484,500
|
|
|
1,453,500
|
|
|||||||||||||||||||||||||||||||||||||
PSU
|
|
2/09/2017
|
|
|
6,513
|
|
|
26,051
|
|
|
39,077
|
|
|
988,114
|
| |||||||||||||||||||||||||||||||||||
RSU
|
|
19,521
|
|
|
639,996
|
| ||||||||||||||||||||||||||||||||||||||||||||
Adrian M. Blocker |
AIP
|
|
2/09/2017
|
|
|
96,900
|
|
|
484,500
|
|
|
1,453,500
|
|
|||||||||||||||||||||||||||||||||||||
PSU
|
|
2/09/2017
|
|
|
6,513
|
|
|
26,051
|
|
|
39,077
|
|
|
988,114
|
| |||||||||||||||||||||||||||||||||||
RSU
|
|
2/09/2017
|
|
|
19,521
|
|
|
639,996
|
| |||||||||||||||||||||||||||||||||||||||||
Rhonda D. Hunter |
AIP
|
|
2/09/2017
|
|
|
96,900
|
|
|
484,500
|
|
|
1,453,500
|
|
|||||||||||||||||||||||||||||||||||||
PSU
|
|
2/09/2017
|
|
|
6,513
|
|
|
26,051
|
|
|
39,077
|
|
|
988,114
|
| |||||||||||||||||||||||||||||||||||
RSU
|
|
2/09/2017
|
|
|
19,521
|
|
|
639,996
|
| |||||||||||||||||||||||||||||||||||||||||
James A. Kilberg |
AIP
|
|
2/09/2017
|
|
|
92,140
|
|
|
460,700
|
|
|
1,382,100
|
|
|||||||||||||||||||||||||||||||||||||
PSU
|
|
2/09/2017
|
|
|
6,309
|
|
|
25,237
|
|
|
37,856
|
|
|
957,239
|
| |||||||||||||||||||||||||||||||||||
RSU
|
|
18,911
|
|
|
619,997
|
|
(1) | The date of the Compensation Committee meeting at which long-term and annual incentive plan grants are approved is the effective grant date for equity grants and grants under the annual incentive plan to the NEOs other than the CEO. Compensation for the CEO, whose equity grants and other compensation decisions are approved by the board of directors based upon recommendations by the Compensation Committee. The date of approval by the board of directors is the effective grant date for equity grants to the CEO. |
40
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WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
Outstanding Equity Awards At 2017 Fiscal Year End
The following table provides information regarding outstanding stock options and unvested stock awards held by each of our NEOs as of December 31, 2017.
Option Awards | Stock Awards | ||||||||||||||||||||||||||||||||||||||||||||
Name
|
Grant Date
|
Number
of (#)
|
Number
of (#)
|
Option Exercise Price ($)
|
Option Date
|
Number of Not
|
Market or Units of Stock That Have Not Vested (3)($)
|
Equity (#)
|
Equity Incentive Plan Awards: Payout Value (3)($)
| ||||||||||||||||||||||||||||||||||||
Doyle R. Simons |
|
06/17/2013
|
|
|
84,118
|
|
|
|
|
|
29.0050
|
|
|
06/17/2023
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||
|
02/13/2014
|
|
|
149,683
|
|
|
49,895
|
|
|
30.2650
|
|
|
02/13/2024
|
|
|
10,976
|
|
|
387,014
|
|
|
21,460
|
|
|
756,680
|
| |||||||||||||||||||
|
02/13/2015
|
|
|
121,409
|
|
|
121,410
|
|
|
35.4050
|
|
|
02/13/2025
|
|
|
20,639
|
|
|
727,731
|
|
|
80,700
|
|
|
1,422,741
|
| |||||||||||||||||||
|
02/10/2016
|
|
|
144,857
|
|
|
434,574
|
|
|
23.0550
|
|
|
02/10/2026
|
|
|
56,929
|
|
|
2,007,317
|
|
|
161,670
|
|
|
5,700,484
|
| |||||||||||||||||||
|
02/10/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
90,661
|
|
|
3,196,707
|
|
|
120,989
|
|
|
4,266,072
|
| |||||||||||||||||||
Russell S. Hagen |
|
02/09/2009
|
|
|
8,000
|
|
|
|
|
|
21.1000
|
|
|
02/09/2019
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||
|
02/08/2010
|
|
|
20,800
|
|
|
|
|
|
22.0200
|
|
|
02/08/2020
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/07/2011
|
|
|
24,000
|
|
|
|
|
|
25.9700
|
|
|
02/07/2021
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/03/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,600
|
|
|
91,676
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/03/2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,600
|
|
|
197,456
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/02/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,600
|
|
|
550,056
|
|
|
|
|
|
|
| |||||||||||||||||||
|
05/19/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
29,697
|
|
|
1,047,116
|
| |||||||||||||||||||
|
02/09/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,521
|
|
|
688,310
|
|
|
26,051
|
|
|
918,558
|
| |||||||||||||||||||
Adrian M. Blocker
|
|
02/12/2014
|
|
|
21,364
|
|
|
7,122
|
|
|
30.1600
|
|
|
02/12/2024
|
|
|
1,567
|
|
|
55,252
|
|
|
3,064
|
|
|
108,037
|
| ||||||||||||||||||
|
02/12/2015
|
|
|
29,074
|
|
|
29,075
|
|
|
35.4050
|
|
|
02/12/2025
|
|
|
4,943
|
|
|
174,290
|
|
|
19,326
|
|
|
340,717
|
| |||||||||||||||||||
|
02/09/2016
|
|
|
32,024
|
|
|
96,075
|
|
|
23.0900
|
|
|
02/09/2026
|
|
|
12,587
|
|
|
443,818
|
|
|
35,743
|
|
|
1,260,298
|
| |||||||||||||||||||
|
02/09/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,521
|
|
|
688,310
|
|
|
26,051
|
|
|
918,558
|
| |||||||||||||||||||
Rhonda D. Hunter |
|
02/12/2014
|
|
|
|
|
|
7,781
|
|
|
30.1600
|
|
|
02/12/2024
|
|
|
1,712
|
|
|
60,365
|
|
|
3,348
|
|
|
118,050
|
| ||||||||||||||||||
|
02/12/2015
|
|
|
29,074
|
|
|
29,075
|
|
|
35.4050
|
|
|
02/12/2025
|
|
|
4,943
|
|
|
174,290
|
|
|
19,326
|
|
|
340,717
|
| |||||||||||||||||||
|
02/09/2016
|
|
|
|
|
|
96,075
|
|
|
23.0900
|
|
|
02/09/2026
|
|
|
12,587
|
|
|
443,818
|
|
|
35,743
|
|
|
1,260,298
|
| |||||||||||||||||||
|
02/09/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,521
|
|
|
688,310
|
|
|
26,051
|
|
|
918,558
|
| |||||||||||||||||||
James A. Kilberg |
|
02/03/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,800
|
|
|
98,728
|
|
|
|
|
|
|
| ||||||||||||||||||
|
02/03/2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,600
|
|
|
197,456
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/02/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,000
|
|
|
528,900
|
|
|
|
|
|
|
| |||||||||||||||||||
|
05/19/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
28,832
|
|
|
1,016,616
|
| |||||||||||||||||||
|
02/09/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,911
|
|
|
666,802
|
|
|
25,237
|
|
|
889,857
|
|
(1) | All option grants vest and are exercisable beginning 12 months after the grant date, with 25% of the options becoming exercisable at that time and with an additional 25% of the options becoming exercisable on each successive anniversary date. Full vesting occurs on the fourth anniversary of the grant date. Options were granted for a term of 10 years and are subject to earlier termination if the executive terminates employment for reasons other than retirement. For participants who reach eligible retirement age, unvested options continue to vest and remain exercisable, in each case until the option expiration date. |
(2) | Stock awards represent outstanding RSUs and PSUs. RSUs granted on February 12, 2014, February 12, 2015, February 9, 2016 and February 9, 2017 vest in 25% increments over four years, beginning 12 months following the grant date. Outstanding RSUs for Messrs. Hagen and Kilberg also represent grants of RSUs made to them by Plum Creek, which RSUs were assumed by the company in connection with the Plum Creek merger. These assumed RSUs also vest in 25% increments over four years, beginning 12 months following the grant date. PSUs granted on February 12, 2014 are earned at the end of a two-year performance period and vest and become available for release 50% on the second anniversary of the grant date and an additional 25% on each successive anniversary of the grant date. PSUs granted on February 12, 2015, February 9, 2016, May 19, 2016, and February 9, 2017 are earned at the end of a three-year performance period and vest entirely and become available for release on the third anniversary of the grant date. |
(3) | Values for RSU awards and PSU awards were computed by multiplying the market price of $35.26 for the companys common stock at end of fiscal year 2017 by the number of units. |
2018 ANNUAL MEETING & PROXY STATEMENT
|
41
|
EXECUTIVE COMPENSATION
Option Exercises and Stock Vested in 2017
The following table provides information for each of our NEOs regarding stock option exercises and vesting of stock awards during 2017. The value realized upon the exercise of options is calculated using the difference between the option exercise price and the market price at the time of exercise multiplied by the number of shares underlying the option. The value realized upon the vesting of stock awards is based on the market price on the vesting date.
Option Awards
|
Stock Awards
|
|||||||||||||||
Name |
Number of (#) |
Value Realized ($) |
Number of (#) |
Value Realized ($) |
||||||||||||
Doyle R. Simons |
| | 83,865 | 2,540,944 | ||||||||||||
Russell S. Hagen |
17,600 | 128,320 | 12,600 | 396,144 | ||||||||||||
Adrian M. Blocker |
| | 11,726 | 350,008 | ||||||||||||
Rhonda D. Hunter |
85,571 | 755,665 | 14,804 | 417,638 | ||||||||||||
James A. Kilberg |
| | 13,120 | 412,493 |
42
|
WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
The following table provides information as of December 31, 2017 for each of our NEOs regarding the actuarial present value of the officers total accumulated benefit under each of our applicable defined benefit plans.
Name |
Plan Name | Years
of (1) (#) |
Present (2) ($) |
Years
of (3) (#) |
Present Value of Accumulated Benefit earned under Formula B (4) ($) |
Total Years of Credited Service (5) (#) |
Total (6) ($) |
Payments During Last Fiscal Year ($) |
||||||||||||||||||||||
Doyle R. Simons |
Pension Plan Title B |
| | 5 | 119,262 | 5 | 119,262 | | ||||||||||||||||||||||
Supplemental Retirement Plan |
| | 5 | 728,475 | 5 | 728,475 | | |||||||||||||||||||||||
Russell S. Hagen |
Plum Creek Pension Plan |
| | | | 23 | 661,078 | | ||||||||||||||||||||||
Plum Creek Supplemental Pension Plan |
| | | | 23 | 1,886,483 | | |||||||||||||||||||||||
Adrian M. Blocker |
Pension Plan Title B |
| | 5 | 159,835 | 5 | 159,835 | | ||||||||||||||||||||||
Supplemental Retirement Plan |
| | 5 | 423,604 | 5 | 432,604 | | |||||||||||||||||||||||
Rhonda D. Hunter |
Pension Plan Title B |
23 | 1,052,508 | 8 | 222,700 | 31 | 1,275,208 | | ||||||||||||||||||||||
Supplemental Retirement Plan |
23 | 2,724,847 | 8 | 571,739 | 31 | 3,296,586 | | |||||||||||||||||||||||
James A. Kilberg |
Plum Creek Pension Plan |
| | | | 13 | 293,366 | | ||||||||||||||||||||||
Plum Creek Supplemental Pension Plan |
| | | | 13 | 645,309 | |
(1) | Number of years of credited service as of December 31, 2009 rounded to the nearest whole year of credited service. These years of service are used for calculating Formula A accrued benefit only. |
(2) | Actuarial present value of accumulated benefit computed as of the same pension plan measurement date used for financial reporting purposes under Financial Accounting Standards Board Accounting Standards Codification Topic 715 with respect to the companys audited financial statements for fiscal year 2017, using age 62, which is the earliest unreduced retirement age for the portion of the benefit earned under Formula A, or Executives actual age if greater. Estimates are based on current compensation and years of service. |
(3) | Number of years of credited service computed beginning on January 1, 2010 and ending as of the same pension plan measurement date used for financial reporting purposes under Financial Accounting Standards Board Accounting Standards Codification Topic 715 with respect to the companys audited financial statements for fiscal year 2017 rounded to the nearest whole year of credited service. These years of service are used for calculating Formula B accrued benefit only. |
(4) | Actuarial present value of accumulated benefit computed as of the same pension plan measurement date used for financial reporting purposes under Financial Accounting Standards Board Accounting Standards Codification Topic 715 with respect to the companys audited financial statements for fiscal year 2017, calculated using age 65, which is the earliest unreduced retirement age for the portion of the benefit earned under Formula B, or Executives actual age if greater. Estimates are based on current compensation and years of service. |
(5) | Includes years of credited service with Plum Creek for Messrs. Hagen and Kilberg. |
(6) | Actuarial present value of accumulated benefit computed as of the same pension plan measurement date used for financial reporting purposes under Financial Accounting Standards Board Accounting Standards Codification Topic 715 with respect to the companys audited financial statements for fiscal year 2017. For former Plum Creek executives using age 62, which is the earliest unreduced retirement age for the portion of the benefit earned under their respective plans, or Executives actual age if greater. Estimates are based on current compensation and years of service. |
2018 ANNUAL MEETING & PROXY STATEMENT
|
43
|
EXECUTIVE COMPENSATION
44
|
WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
Non-Qualified Deferred Compensation
The following table provides information for each of our NEOs regarding aggregate executive and company contributions, aggregate earnings for 2017 and year-end account balances under the companys deferred compensation plan.
Name |
Executive Contributions in Last FY (1) ($) |
Registrant Contributions in Last FY (2) ($) |
Aggregate Earnings in Last FY (3) ($) |
Aggregate Withdrawals/ Distributions ($) |
Aggregate Balance at Last FYE (4) ($) | ||||||||||||||||||||
Doyle R. Simons |
| | | | | ||||||||||||||||||||
Russell S. Hagen |
| 52,158 | 4,386 | | 56,544 | ||||||||||||||||||||
Adrian M. Blocker |
| | | | | ||||||||||||||||||||
Rhonda D. Hunter |
| | 117,488 | | 960,948 | ||||||||||||||||||||
James A. Kilberg |
| 46,319 | 3,114 | | 49,433 |
(1) | Amounts are also reported in the Summary Compensation Table as salary earned and paid in 2017. |
(2) | Amounts reported in this column represent non-elective employer contributions under the Supplemental Defined Contribution Plan. These amounts are also reported in the Summary Compensation Table under All Other Compensation. |
(3) | Fiscal 2017 earnings, which includes interest on amounts deferred into the fixed interest account of the deferral plan and appreciation or depreciation in the price of common stock equivalent units, plus dividend equivalents for amounts deferred in the common stock equivalents account in the deferral plan. |
(4) | Amounts were also reported as compensation in the Summary Compensation Table for previous years, and include interest earned on amounts deferred into the fixed-interest account of the deferral plan, any premium for amounts deferred into the common stock equivalents account in the deferral plan, and appreciation or depreciation in the price of common stock equivalent units, plus dividend equivalents for amounts deferred into the common stock equivalents account in the deferral plan. |
2018 ANNUAL MEETING & PROXY STATEMENT
|
45
|
EXECUTIVE COMPENSATION
KEY TERMS
Cause means a participants:
● willful and continued failure to perform substantially the officers duties after the company delivers to the participant written demand for substantial performance specifically identifying the manner in which the officer has not substantially performed his or her duties;
● conviction of a felony; or
● willfully engaging in illegal conduct or gross misconduct that is materially and demonstrably injurious to the company.
Good Reason means:
● a material reduction in the officers position, title or reporting responsibilities existing prior to the change in control;
● a requirement that the officer be based in a location that is at least 50 miles farther from the companys headquarters than the officers primary residence was located immediately prior to the change in control;
● a material reduction by the company in the officers base salary as of the effective date of the change in control;
● a material reduction in the officers benefits unless the overall benefits provided are substantially consistent with the average level of benefits of the other officers holding similar positions; or
● a material reduction in the officers level of participation in any of the companys short- or long-term incentive compensation plans.
Disability means a medical condition in which a person is entitled to either total and permanent disability under the Social Security Act or judged to be totally and permanently disabled by the administrative committee or a committee delegated authority to make such determinations.
|
46
|
WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
The following tables describe estimated potential payments to the NEOs that could be made upon a change in control with a qualifying termination or upon an involuntary termination other than for Cause, in each case as if the event had occurred on December 31, 2017. For equity awards, the values were based on the closing price of our common stock on December 31, 2017, less the applicable option exercise price (in the case of options) and assuming target performance (in the case of PSUs). Generally, there are no payments made to executive officers in the event of an involuntary termination for Cause.
Change in Control + Qualifying Termination
|
||||||||||||||||||||
Name |
Cash (1) ($) | Equity (2) ($) | Pension (3) ($) | Other (4) ($) | Total ($) | |||||||||||||||
Doyle R. Simons |
10,100,000 | 26,976,754 | 550,810 | 149,199 | 37,776,763 | |||||||||||||||
Russell S. Hagen |
3,988,500 | 3,625,363 | 277,465 | 149,199 | 8,040,527 | |||||||||||||||
Adrian M. Blocker |
3,842,500 | 5, 865,940 | 371,796 | 149,199 | 10,229,435 | |||||||||||||||
Rhonda D. Hunter |
3,999,462 | 5,887,036 | 1,112,181 | 149,199 | 11,147,878 | |||||||||||||||
James A. Kilberg |
3,649,100 | 3,526,564 | 233,153 | 149,199 | 7,558,016 |
(1) | Amounts include salary, target bonus and earned annual bonus. |
(2) | Amounts include the intrinsic value of accelerated vesting of stock options, RSUs and PSUs as of December 31, 2017. See discussion under Change in Control for more information. |
(3) | Represents an estimated present value of annual increase in pension payments required pursuance to the NEOs change in control agreement with the company. The annual increase assumes credit for three additional years of service applies to benefits earned under Formula B and three additional years of age apples to benefits earned under Formula A and B following termination of employment. See discussion under Pension Benefits on page 43 for more information about these pension plans. For Messrs. Hagen and Kilberg, the annual incremental increase assumes credit for three additional years of service and three additional years of age applies to benefits under their respective former Plum Creek pension plans following termination of employment. |
(4) | Amounts include a lump sum payment to assist in paying for replacement health and welfare coverage for a reasonable period following the date of termination and related gross up payment, and an allowance for outplacement services with a value of up to $20,000 (if utilized by an executive, fees are paid directly to the outplacement service provider). |
2018 ANNUAL MEETING & PROXY STATEMENT
|
47
|
EXECUTIVE COMPENSATION
Severance | ||||||||||||||||||||
Name |
Cash (1) ($) | Equity (2) ($) | Pension ($) | Other (3) ($) | Total ($) | |||||||||||||||
Doyle R. Simons |
7,600,000 | 8,517,336 | | 37,227 | 16,154,563 | |||||||||||||||
Russell S. Hagen |
3,988,500 | 3,625,363 | | 37,227 | 7,651,090 | |||||||||||||||
Adrian M. Blocker |
2,260,750 | 1,819,374 | | 37,227 | 4,117,351 | |||||||||||||||
Rhonda D. Hunter |
2,417,712 | 1,840,471 | | 37,227 | 4,295,410 | |||||||||||||||
James A. Kilberg |
3,649,100 | 3,526,564 | | 37,227 | 7,212,891 |
(1) | Amounts include salary, target bonus and earned annual bonus. |
(2) | For termination without cause, vesting continues for one year. Vested options would remain exercisable for the lesser of three years or the original term. Notwithstanding the additional year of vesting, the three-year vesting period would not be achieved for PSUs granted in 2016 and 2017 and no shares would therefore be earned. Vesting would accelerate for unvested RSUs granted to Messrs. Hagen and Kilberg by Plum Creek and assumed by the company under the terms of change in control agreements entered into between Plum Creek and Messrs. Hagen and Kilberg, respectively, and assumed by the company. These agreements expired on February 16, 2018. |
(3) | Amounts include a lump sum payment to assist in paying for replacement health and welfare coverage and related gross up payment, along with an allowance for outplacement services with a value of up to $20,000 (if utilized by an executive, fees are paid directly to the outplacement service provider). |
Other Severance - Death or Disability
|
||||||||||||||||||||
Name |
Cash (1) ($) | Equity (2) ($) | Pension ($) | Other ($) | Total ($) | |||||||||||||||
Doyle R. Simons |
2,600,000 | 26,976,754 | | | 29,576,754 | |||||||||||||||
Russell S. Hagen |
825,000 | 3,625,363 | | | 4,450,363 | |||||||||||||||
Adrian M. Blocker |
679,000 | 5,865,940 | | | &nbs |