Compensation
Committee Report
The
Compensation Committee has:
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(1)
-
reviewed
and discussed the Compensation Discussion and Analysis included in this proxy statement with management; and
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(2)
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based
on this review and discussion, recommended to the Board of Directors that the Compensation Discussion and Analysis be included in the Company's proxy
statement relating to the 2017 Annual Meeting of shareholders.
Members
of the Compensation Committee
Susan E. Arnold (Chair)
Maria Elena Lagomasino
Aylwin B. Lewis
Orin C. Smith
Table of Contents
Fiscal 2016 Summary Compensation Table
The following table provides information concerning the total compensation earned in fiscal 2014 (except for Mr. Staggs and
Ms. McCarthy, who were not named executive officers in those years), in fiscal 2015 and fiscal 2016 by the chief executive officer, the chief financial officer and the three other persons
serving as executive officers at the end of fiscal 2016 who were the most highly compensated executive officers of the Company in fiscal 2016, plus Mr. Staggs, the chief operating officer
through May 6, 2016. These six officers are referred to as the named executive officers or NEOs in this proxy statement. Information regarding the amounts in each column follows the table.
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Name and Principal Position
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Fiscal
Year
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Salary
1
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Stock
Awards
2
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Option
Awards
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Non-Equity
Incentive
Plan
Compensation
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Change in
Pension Value
and
Nonqualified
Deferred
Compensation
Earnings
3
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All Other
Compensation
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Total
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Robert A. Iger
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2016
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$2,500,000
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$8,828,117
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$8,454,674
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$20,000,000
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$2,893,778
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$1,205,827
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$43,882,396
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Chairman and Chief Executive
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2015
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2,548,077
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8,862,741
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8,419,823
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22,340,000
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1,423,047
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1,319,926
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44,913,614
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Officer
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2014
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2,500,000
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8,943,204
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8,339,396
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22,810,000
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2,795,268
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1,109,150
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46,497,018
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Alan N. Braverman
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2016
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1,549,000
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1,878,037
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1,252,040
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5,440,000
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931,443
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68,431
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11,118,951
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Senior Executive Vice President,
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2015
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1,502,692
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1,847,400
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1,200,012
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5,532,000
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395,940
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216,573
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10,694,617
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General Counsel and Secretary
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2014
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1,374,231
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1,865,250
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1,200,017
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5,325,000
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760,263
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60,544
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10,585,305
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Christine M. McCarthy
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2016
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1,287,692
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1,950,106
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1,300,058
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4,520,000
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1,104,131
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36,523
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10,198,510
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Senior Executive Vice President
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2015
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869,712
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1,003,783
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652,018
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4,310,000
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155,346
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79,194
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7,070,053
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and Chief Financial Officer
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Kevin A. Mayer
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2016
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1,287,692
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1,950,106
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1,300,058
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4,520,000
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1,031,418
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36,075
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10,125,349
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Senior Executive Vice President
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2015
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1,050,250
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1,354,785
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880,006
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4,310,000
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303,767
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107,763
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8,006,571
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and Chief Strategy Officer
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2014
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925,981
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1,243,500
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800,005
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2,222,000
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571,782
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40,142
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5,803,410
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M. Jayne Parker
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2016
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826,385
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1,320,122
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880,052
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1,815,000
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711,775
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51,060
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5,604,394
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Executive Vice President and
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2015
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797,077
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1,354,785
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880,006
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1,844,000
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664,810
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112,388
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5,653,066
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Chief Human Resources Officer
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2014
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722,269
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1,243,500
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800,005
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1,735,000
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880,174
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37,339
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5,418,287
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Thomas O. Staggs
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2016
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2,045,231
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4,120,009
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4
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4,120,131
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4
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7,000,000
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829,470
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3,642,246
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5
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21,757,087
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Former Chief Operating Officer
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2015
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1,963,541
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4,606,238
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3,404,372
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8,620,000
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1,362,596
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49,490
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20,006,237
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-
1
-
The
amounts reflect compensation for 53 weeks in fiscal year 2015 compared to 52 weeks in fiscal 2014 and fiscal 2016 due to the
timing of the end of the fiscal period.
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2
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Stock
awards for each fiscal year include awards subject to performance conditions that were valued based on the probability that performance
targets will be achieved. Assuming the highest level of performance conditions are achieved, the grant date stock award values would be as follows:
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Fiscal Year
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Mr. Iger
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Mr. Braverman
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Ms. McCarthy
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Mr. Mayer
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Ms. Parker
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Mr. Staggs
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2016
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$
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12,681,647
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$2,287,925
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$2,375,735
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$
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2,375,735
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$
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1,608,262
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$
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5,918,419
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2015
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12,629,785
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2,250,073
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1,222,575
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1,650,084
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1,650,084
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5,780,623
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2014
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12,509,144
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2,250,109
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NA
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1,500,072
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1,500,072
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NA
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-
3
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As
described more fully under "Change in Pension Value and Nonqualified Deferred Compensation Earnings" below, changes in pension value in 2014,
2015 and 2016 were driven largely by changes in the discount rate applied to calculate the present value of future pension payments.
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4
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As
a result of the termination of Mr. Staggs's employment, he will not vest or have value in his stock awards and he will vest in only
one-half of his option awards. The grant date fair value of the option awards that will vest is $2,060,066.
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5
-
This
includes salary continuation through the original termination date of Mr. Staggs's employment agreement as described on
page 52, below.
Continues on next page ►
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The Walt Disney Company Notice of 2017 Annual Meeting and Proxy
Statement 35
|
Table of Contents
Salary.
This column sets forth the
base salary earned during each fiscal year.
Stock Awards.
This column sets forth the grant date fair value of the restricted stock unit awards granted to the named executive
officers during each fiscal year as part of the Company's long-term incentive
compensation program. The grant date fair value of these awards was calculated by multiplying the number of units awarded by the average of the high and low trading price of the Company's common stock
on the grant date, subject to valuation adjustments for restricted stock unit awards subject to performance-based vesting conditions other than the test to assure deductibility under
Section 162(m) of the Internal Revenue Code. The valuation adjustments, which reflect the fact that the number of shares received on vesting varies based on the level of performance achieved,
were determined using a Monte Carlo simulation that determines the probability that the performance targets will be achieved. The grant date fair value of the restricted stock unit awards granted
during fiscal 2016 is also included in the Fiscal 2016 Grants of Plan Based Awards table on page 38.
Option Awards.
This column sets forth the grant date fair value of options to purchase shares of the Company's common stock granted to
the named executive officers during each fiscal year. The grant-date fair value of these options was calculated using a binomial option pricing model. The assumptions used in estimating the fair value
of these options are set forth in footnote 12 to the Company's Audited Financial Statements for fiscal 2016. The grant date fair value of the options granted during fiscal 2016 is also included in the
Fiscal 2016 Grants of Plan Based Awards table on page 38.
Non-Equity Incentive Plan Compensation.
This column sets forth the amount of compensation earned by the named executive officers under
the Company's annual performance-based bonus program during each fiscal year. A description of the Company's annual performance-based bonus program is included in the discussion of
"2016 Total Direct
Compensation"
in the
"Executive Compensation Program Structure"
section, and the
determination of performance-based bonuses for fiscal 2016 is described in the
"2016 Compensation Decisions"
section of the
Compensation Discussion and Analysis
beginning on page 19.
Change in Pension Value and Nonqualified Deferred Compensation Earnings.
This column reflects the aggregate change in the actuarial
present value of each named executive officer's accumulated benefits under all defined benefit plans, including supplemental plans, during each fiscal year. The amounts reported in this column vary
with a number of factors, including the discount rate applied to determine the value of future
payment streams. The discount rate used pursuant to pension accounting rules to calculate the present value of future payments was 5.00% for fiscal 2013, 4.40%
for fiscal 2014, 4.47% for fiscal 2015 and 3.73% for fiscal 2016. The decrease in fiscal 2014 and fiscal 2016 drove substantial increases in the present value of future payments. Neither increases nor
decreases in pension value resulting from changes in the discount rate result in any increase or decrease in benefits payable to participants under the plan. Pension values in fiscal 2015 increased
despite the small increase in the discount rate due to the effect of an additional year of service and higher compensation levels.
Mr. Iger,
Ms. McCarthy, Ms. Parker and Mr. Staggs were credited with earnings on deferred compensation as disclosed below under "Deferred Compensation". These earnings were
at rates that were not above market rates and therefore are not reported in this column.
All Other Compensation.
This column sets forth all of the compensation for each fiscal year that we could not properly report in any
other column of the table, including:
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the incremental cost to the Company of perquisites and other personal benefits;
-
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the amount of Company contributions to employee
savings plans;
-
-
the dollar value of insurance premiums paid by the Company with respect to excess liability insurance for the
named executive officers;
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a one-time payout of accumulated vacation time in fiscal 2015 resulting from a Company-wide change in policy
relating to vacation accrual;
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the dollar amount of matching charitable contributions made to charities pursuant to the Company's charitable
gift matching program, which is available to all regular US employees with at least one year of service; and
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-
for Mr. Staggs, salary continuation through the original termination
date of Mr. Staggs's
employment agreement as described on page 52, below.
The
dollar amount of matching charitable contributions was $15,000, $12,050, $15,000, $15,000 and $12,500 for Mr. Iger, Mr. Braverman, Ms. McCarthy, Mr. Mayer and
Ms. Parker, respectively.
In
accordance with the SEC's interpretations of its rules, this column also sets forth the incremental cost to the Company of certain items that are provided to the named executive officers for
business purposes but which may not be considered integrally related to his or her duties.
Table of Contents
The
following table sets forth the incremental cost to the Company of each perquisite and other personal benefit that exceeded the greater of $25,000 or 10% of the total amount of perquisites and
personal benefits for a named executive officer in fiscal 2016.
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Personal Air
Travel
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Security
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Other
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Total
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Robert A. Iger
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$282,831
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$
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869,476
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$
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32,350
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$
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1,184,657
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Alan N. Braverman
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50,081
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50,081
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Christine M. McCarthy
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15,400
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15,400
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Kevin A. Mayer
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14,760
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14,760
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M. Jayne Parker
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32,350
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32,350
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Thomas O. Staggs
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31,223
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31,223
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The
incremental cost to the Company of the items specified above was determined as follows:
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Personal air travel: the actual catering costs, landing and ramp fees, fuel costs and lodging costs incurred by
flight crew plus a per hour charge based on the average hourly maintenance costs for the aircraft during the year for flights that were purely personal in nature, and a pro rata portion of catering
costs where personal guests accompanied a named executive officer on flights that were business in nature. Where a personal flight coincided with the repositioning of an aircraft
following
a business flight, only the incremental costs of the flight compared to an immediate repositioning of the aircraft are included. As noted on pages 23 to 24, above, Mr. Iger is
required for security reasons to use corporate aircraft for all of his personal travel.
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-
Security: the actual costs incurred by the Company for providing security services and equipment.
The
"Other" column in the table above includes, to the extent a named executive officer elected to receive any of these benefits, the incremental cost to the Company of the vehicle benefit, personal
air travel or security services where the cost to the Company was less than $25,000, reimbursement of up to $1,000 per calendar year for wellness-related purposes such as fitness and nutrition
management, and reimbursement of expenses for financial consulting.
The
named executive officers also were eligible to receive the other benefits described in the
Compensation Discussion and Analysis
under the discussion
of "
Benefits and Perquisites
" in the "
Compensation Program Elements
" section, which involved no
incremental cost to the Company or are offered through group life, health or medical reimbursement plans that are available generally to all of the Company's salaried employees.
Continues on next page ►
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The Walt Disney Company Notice of 2017 Annual Meeting and Proxy
Statement 37
|
Table of Contents
Fiscal 2016 Grants of Plan Based Awards Table
The following table provides information concerning the range of awards available to the named executive officers under the Company's
annual performance-based bonus program for fiscal 2016 and information concerning the option grants and restricted stock unit awards made to the named executive officers during fiscal 2016. Additional
information regarding the amounts reported in each column follows the table.
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Estimated Future
Payouts Under Non-Equity
Incentive Plan Awards
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Estimated Future Payouts
Under Equity
Incentive Plan Awards
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Grant
Date
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Threshold
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Target
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Maximum
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Threshold
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Target
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Maximum
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All Other
Option
Awards:
Number of
Securities
Underlying
Options
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|
Exercise
or Base
Price of
Option
Awards
|
|
|
Grant
Date
Closing
Price of
Shares
Underlying
Options
|
|
|
Grant
Date Fair
Value of
Stock and
Option
Awards
|
|
|
|
|
|
|
|
|
|
|
12/17/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
271,331
|
|
|
$113.23
|
|
|
$112.01
|
|
|
$8,454,674
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Robert A. Iger
|
|
|
|
|
|
12/17/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
37,333
|
|
|
74,666
|
|
|
111,999
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,828,117
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$4,200,000
|
|
|
$12,000,000
|
|
|
$24,000,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/17/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
40,181
|
|
|
$113.23
|
|
|
$112.01
|
|
|
$1,252,040
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(A
|
)
|
|
12/17/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,293
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
939,016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Alan N. Braverman
|
|
|
(B
|
)
|
|
12/17/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,971
|
|
|
7,942
|
|
|
11,913
|
|
|
|
|
|
|
|
|
|
|
|
|
|
939,021
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$1,095,500
|
|
|
$3,130,000
|
|
|
$6,260,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/17/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
41,722
|
|
|
$113.23
|
|
|
$112.01
|
|
|
$1,300,058
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(A
|
)
|
|
12/17/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,611
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
975,024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Christine M. McCarthy
|
|
|
(B
|
)
|
|
12/17/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,124
|
|
|
8,247
|
|
|
12,371
|
|
|
|
|
|
|
|
|
|
|
|
|
|
975,082
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$910,000
|
|
|
$2,600,000
|
|
|
$5,200,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/17/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
41,722
|
|
|
$113.23
|
|
|
$112.01
|
|
|
$1,300,058
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(A
|
)
|
|
12/17/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,611
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
975,024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kevin A. Mayer
|
|
|
(B
|
)
|
|
12/17/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,124
|
|
|
8,247
|
|
|
12,371
|
|
|
|
|
|
|
|
|
|
|
|
|
|
975,082
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$910,000
|
|
|
$2,600,000
|
|
|
$5,200,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/17/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
28,243
|
|
|
$113.23
|
|
|
$112.01
|
|
|
$880,052
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(A
|
)
|
|
12/17/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,829
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
660,017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
M. Jayne Parker
|
|
|
(B
|
)
|
|
12/17/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,792
|
|
|
5,583
|
|
|
8,375
|
|
|
|
|
|
|
|
|
|
|
|
|
|
660,105
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$365,313
|
|
|
$1,043,750
|
|
|
$2,087,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/17/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
132,225
|
2
|
|
$113.23
|
|
|
$112.01
|
|
|
$4,120,131
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Thomas O. Staggs
|
|
|
|
|
|
12/17/15
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17,423
|
3
|
|
34,846
|
3
|
|
52,269
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
4,120,009
|
1,
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$1,802,500
|
|
|
$5,150,000
|
|
|
$10,300,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
1
-
Stock
awards for fiscal 2016 subject to performance conditions in addition to the test to assure deductibility under Section 162(m) were
valued based on the probability that performance targets will be achieved. Assuming the highest level of performance conditions are achieved, the grant date fair values for performance-based stock
awards made in fiscal 2016 would be $12,681,647, $1,348,909, $1,400,712, $1,400,712, $948,245 and $5,918,419 for Mr. Iger, Mr. Braverman, Ms. McCarthy, Mr. Mayer,
Ms. Parker and Mr. Staggs, respectively.
-
2
-
As
a result of the termination of Mr. Staggs's employment, he will vest in only one-half in his option awards. The grant date fair value
of the option awards that will vest is $2,060,066.
-
3
-
As
a result of the termination of Mr. Staggs's employment, these awards will not vest and the grant date fair value of awards that vest
is therefore zero.
Table of Contents
Grant date.
The Compensation
Committee made the annual grant of stock options and restricted stock unit awards for fiscal 2016 on December 17, 2015. The Compensation Committee approved awards under the annual
performance-based bonus program on November 29, 2016.
Estimated Possible Payouts Under Non-equity Incentive Plan Awards.
As described in the
Compensation Discussion
and Analysis
, the Compensation Committee sets the target bonus opportunity for the named executive officers at the beginning of the fiscal year, and the actual bonuses for the
named executive officers may, except in special circumstances such as unusual challenges or extraordinary successes, range from 35% to 200% of the target level based on the Compensation Committee's
evaluation of financial and other performance factors for the fiscal year. The bonus amount may be zero, if actual performance is below the specified threshold level (including the
Section 162(m) test), or less than the calculated amounts if the Compensation Committee otherwise decides to reduce the bonus. As addressed in the discussion of
2016
Compensation Decisions
in the
Compensation Discussion and Analysis
, the employment agreements of each executive officer require
that the target used to calculate the bonus opportunity (but not the actual bonus awarded) be at least the amount specified in each agreement. This column shows the range of potential bonus payments
for each named executive officer from the threshold to the maximum based on the target range set at the beginning of the fiscal year. The actual bonus amounts received for fiscal 2016 are set forth in
the "Non-Equity Incentive Plan Compensation" column of the Summary Compensation Table.
Estimated Future Payouts Under Equity Incentive Plan Awards.
This column sets forth the number of restricted stock units awarded to the
named executive officers during fiscal 2016 that are subject to the test to assure eligibility for deduction under Section 162(m) and/or to performance tests as described below. These include
units awarded to each of the named executive officers as part of the annual grant in December 2015. Each of Mr. Iger's awards is (and Mr. Staggs's awards were when awarded) subject to
both the test to assure eligibility under Section 162(m) and the performance tests described below. The units in row A for each of the other named executive officers are subject to the test to
assure eligibility under Section 162(m) and the
units in row B are subject to this test as well as the performance tests described below. The vesting dates for all of the outstanding restricted stock unit
awards held by the named executive officers as of the end of fiscal 2016 are set forth in the Fiscal 2016 Outstanding Equity Awards at Fiscal Year-End table below.
All
units subject to only the Section 162(m) test (Row A) (plus any shares received as dividend equivalents prior to vesting) vest if that test is met and none of the units vest if the
test is not met. This amount is shown in the "target" column for Row A.
In
the case of units subject to both the Section 162(m) test and the performance tests (all of Mr. Iger's and Mr. Staggs's units and the units in Row B for other named executive
officers), none of the units vest if the Section 162(m) test is not met and units vest as follows if the Section 162(m) test is met.
Half
of the units are subject to a total shareholder return test and half of the units are subject to an earnings per share test. For each half:
-
-
None of the units related to a measure vest if the Company's total shareholder return or earnings per share,
respectively, is below the 25
th
percentile of the S&P 500 for that measure.
-
-
If the Company's total shareholder return or earnings per share, respectively, is at
or above the
25
th
percentile of the S&P 500 for the related measure, the number of units related to that measure that vest will vary from 50% of the target number related to that
measure (at the 25
th
percentile) to 150% of the target number related to that measure (at or above the 75
th
percentile) (in each case, plus dividend
equivalent units).
For
example, for the one-half of the grant subject to an earnings per share test, and the other half separately subject to a total shareholder return test, the total number of shares vesting would
equal:
-
-
the number in the "threshold" column if the Company is at the 25
th
percentile for each
test;
-
-
the number in the "target" column if the Company is at the 50
th
percentile for each test;
and
-
-
the number in the "maximum" column if the Company is at or exceeds the 75
th
percentile for
each test (in each case, plus dividend equivalent units).
Continues on next page ►
|
|
The Walt Disney Company Notice of 2017 Annual Meeting and Proxy
Statement 39
|
Table of Contents
Earnings per share for the Company is adjusted (i) to exclude the effect of extraordinary, unusual and/or nonrecurring items and (ii) to reflect
such other factors as the Committee deems appropriate to fairly reflect earnings per share growth. Adjustments to diluted Earnings per share from continuing operations of S&P 500 companies will
not normally be made because the Committee has no reason to believe that the average of adjustments across the S&P 500 companies would result in an amount that is significantly different from
the reported amount.
When
dividends are distributed to shareholders, dividend equivalents are credited in an amount equal to the dollar amount of dividends on the number of units held on the dividend record date divided
by the fair market value of the Company's shares of common stock on the dividend distribution date. Dividend equivalents vest only when, if and to the extent that the underlying units vest.
All Other Option Awards: Number of Securities Underlying Options.
This column sets forth the options to purchase shares of the Company's
common stock granted to the named executive officers as part of the
annual grant in December 2015. The vesting dates for these options are set forth in the Fiscal 2016 Outstanding Equity Awards at Fiscal Year-End table below.
These options are scheduled to expire ten years after the date of grant.
Exercise or Base Price of Option Awards; Grant Date Closing Price of Shares Underlying Options.
These columns set forth the exercise
price for each option grant and the closing price of the Company's common stock on the date of grant. The exercise price is equal to the average of the high and low trading price on the grant date,
which may be higher or lower than the closing price on the grant date.
Grant Date Fair Value of Stock and Option Awards.
This column sets forth the grant date fair value of the stock and option awards
granted during fiscal 2016 calculated in accordance with applicable accounting requirements. The grant date fair value of all restricted stock unit awards and options is determined as described on
page 36, above.
Table of Contents
Fiscal 2016 Outstanding Equity Awards at Fiscal
Year-End Table
The following table provides information concerning outstanding unexercised options and unvested restricted stock unit awards held by
the named executive officers as of October 1, 2016. Additional information regarding the amounts reported in each column follows the table.
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Option Awards
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Stock Awards
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Number of Securities
Underlying Unexercised
Options
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Equity Incentive Plan
Awards
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|
Grant
Date
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|
Exercisable
|
|
Unexercisable
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Option
Exercise
Price
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|
Option
Expiration
Date
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Number
of
Units
That
Have Not
Vested
|
|
Market
Value of
Units
That
Have Not
Vested
|
|
|
|
|
|
Number
of
Unearned
Units
That
Have Not
Vested
|
|
Market
Value of
Unearned
Units
That
Have Not
Vested
|
|
|
|
|
|
|
|
|
1/13/2010
|
|
|
|
|
|
465,578
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|
|
|
|
|
|
|
$31.12
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|
1/13/2020
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|
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|
|
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|
|
|
|
|
|
1/26/2011
|
|
|
|
|
|
437,679
|
|
|
|
|
|
|
|
39.65
|
|
1/26/2021
|
|
|
|
|
|
|
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|
|
|
|
|
|
Robert A. Iger
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|
1/18/2012
|
|
|
|
|
|
732,079
|
|
|
|
|
|
|
|
38.75
|
|
1/18/2022
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|
|
|
|
|
|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1/16/2013
|
|
|
|
|
|
514,162
|
|
171,388(A)
|
|
|
|
|
|
51.29
|
|
1/16/2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/19/2013
|
|
|
|
|
|
217,610
|
|
217,610(B)
|
|
|
|
|
|
72.59
|
|
12/19/2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
173,865(C)
|
|
$16,145,123
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
12/18/2014
|
|
|
|
|
|
93,103
|
|
279,309(D)
|
|
|
|
|
|
92.24
|
|
12/18/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
139,696(E)
|
|
12,972,127
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
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|
|
|
12/17/2015
|
|
|
|
|
|
|
|
271,331(F)
|
|
|
|
|
|
113.23
|
|
12/17/2025
|
|
|
|
|
|
|
|
|
|
|
|
|
|
112,826(G)
|
|
10,477,021
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|
|
|
|
|
|
|
|
|
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|
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|
|
|
|
|
|
|
|
|
|
1/13/2010
|
|
|
|
|
|
93,116
|
|
|
|
|
|
|
|
$31.12
|
|
1/13/2020
|
|
|
|
|
|
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|
|
1/26/2011
|
|
|
|
|
|
87,536
|
|
|
|
|
|
|
|
39.65
|
|
1/26/2021
|
|
|
|
|
|
|
|
|
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|
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|
|
|
|
|
|
|
|
|
|
Alan N. Braverman
|
|
1/18/2012
|
|
|
|
|
|
94,462
|
|
|
|
|
|
|
|
38.75
|
|
1/18/2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1/16/2013
|
|
|
|
|
|
63,071
|
|
21,024(A)
|
|
|
|
|
|
51.29
|
|
1/16/2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,879(H)
|
|
$360,244
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/19/2013
|
|
|
|
|
|
31,313
|
|
31,314(B)
|
|
|
|
|
|
72.59
|
|
12/19/2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
25,216(I)
|
|
2,341,532
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/18/2014
|
|
|
|
|
|
13,269
|
|
39,808(D)
|
|
|
|
|
|
92.24
|
|
12/18/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22,416(J)
|
|
2,081,590
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/17/2015
|
|
|
|
|
|
|
|
40,181(F)
|
|
|
|
|
|
113.23
|
|
12/17/2025
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,355(K)
|
|
1,890,184
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1/13/2010
|
|
|
|
|
|
39,617
|
|
|
|
|
|
|
|
$31.12
|
|
1/13/2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1/26/2011
|
|
|
|
|
|
34,139
|
|
|
|
|
|
|
|
39.65
|
|
1/26/2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Christine M. McCarthy
|
|
1/18/2012
|
|
|
|
|
|
45,342
|
|
|
|
|
|
|
|
38.75
|
|
1/18/2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1/16/2013
|
|
|
|
|
|
31,899
|
|
10,634(A)
|
|
|
|
|
|
51.29
|
|
1/16/2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,962(H)
|
|
$182,227
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/19/2013
|
|
|
|
|
|
15,343
|
|
15,344(B)
|
|
|
|
|
|
72.59
|
|
12/19/2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,357(I)
|
|
1,147,453
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/18/2014
|
|
|
|
|
|
7,209
|
|
21,630(D)
|
|
|
|
|
|
92.24
|
|
12/18/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,180(J)
|
|
1,131,076
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/17/2015
|
|
|
|
|
|
|
|
41,722(F)
|
|
|
|
|
|
113.23
|
|
12/17/2025
|
|
|
|
|
|
|
|
|
|
|
|
|
|
21,136(K)
|
|
1,962,728
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1/18/2012
|
|
|
|
|
|
14,264
|
|
|
|
|
|
|
|
$38.75
|
|
1/18/2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1/16/2013
|
|
|
|
|
|
14,555
|
|
14,555(A)
|
|
|
|
|
|
51.29
|
|
1/16/2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,750(H)
|
|
$255,380
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kevin A. Mayer
|
|
3/5/2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,393(L)
|
|
129,374
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/19/2013
|
|
|
|
|
|
20,875
|
|
20,876(B)
|
|
|
|
|
|
72.59
|
|
12/19/2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
16,810(I)
|
|
1,561,021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/18/2014
|
|
|
|
|
|
9,730
|
|
29,193(D)
|
|
|
|
|
|
92.24
|
|
12/18/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
16,439(J)
|
|
1,526,556
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/17/2015
|
|
|
|
|
|
|
|
41,722(F)
|
|
|
|
|
|
113.23
|
|
12/17/2025
|
|
|
|
|
|
|
|
|
|
|
|
|
|
21,136(K)
|
|
1,962,728
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1/18/2012
|
|
|
|
|
|
13,225
|
|
|
|
|
|
|
|
$38.75
|
|
1/18/2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1/16/2013
|
|
|
|
|
|
33,961
|
|
11,321(A)
|
|
|
|
|
|
51.29
|
|
1/16/2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,139(H)
|
|
$198,597
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
M. Jayne Parker
|
|
12/19/2013
|
|
|
|
|
|
20,875
|
|
20,876(B)
|
|
|
|
|
|
72.59
|
|
12/19/2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
16,810(I)
|
|
1,561,021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/18/2014
|
|
|
|
|
|
9,730
|
|
29,193(D)
|
|
|
|
|
|
92.24
|
|
12/18/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
16,439(J)
|
|
1,526,556
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/17/2015
|
|
|
|
|
|
|
|
28,243(F)
|
|
|
|
|
|
113.23
|
|
12/17/2025
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14,308(K)
|
|
1,328,676
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1/16/2013
|
|
|
|
|
|
123,715
|
|
41,239(A)
|
|
|
|
|
|
$51.29
|
|
1/16/2023
*
|
|
|
|
|
|
7,791(H)
|
|
$723,482
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/19/2013
|
|
|
|
|
|
55,424
|
|
55,425(B)
|
|
|
|
|
|
72.59
|
|
12/19/2023
*
|
|
|
|
|
|
11,418(M)
|
|
1,060,250
|
|
|
|
|
|
33,213(C)
|
|
$3,084,162
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Thomas O. Staggs
|
|
12/18/2014
|
|
|
|
|
|
24,415
|
|
48,830(N)
|
|
|
|
|
|
92.24
|
|
12/18/2024
*
|
|
|
|
|
|
9,181(O)
|
|
852,526
|
|
|
|
|
|
27,476(P)
|
|
2,551,454
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2/5/2015
|
|
|
|
|
|
12,034
|
|
24,069(Q)
|
|
|
|
|
|
101.68
|
|
2/5/2025
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
16,460(R)
|
|
1,528,456
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/17/2015
|
|
|
|
|
|
|
|
66,112(S)
|
|
|
|
|
|
113.23
|
|
12/17/2025
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(T)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
*
-
These
awards will not be exercisable after December 30, 2019 as a result of Mr. Staggs's termination of employment.
Continues on next page ►
|
|
The Walt Disney Company Notice of 2017 Annual Meeting and Proxy
Statement 41
|
Table of Contents
Number of Securities Underlying Unexercised Options: Exercisable and
Unexercisable.
These columns set forth, for each named executive officer and for each grant made to the
officer, the number of shares of the Company's common stock that can be acquired upon exercise of outstanding options. The vesting schedule for each option with unexercisable shares is shown under
"
Vesting Schedule.
" The vesting of options held by the named executive officers may be accelerated in the circumstances described under
"
Potential Payments and Rights on Termination or Change in Control
," below.
Number; Market Value of Shares or Units of Stock That Have Not Vested.
These columns report the number and market value, respectively,
of shares underlying each grant of restricted stock units to each officer that
is not
subject to performance vesting conditions nor the test to assure
eligibility for deduction pursuant to Section 162(m). The number of shares includes dividend equivalent units that have accrued for dividends payable through October 1, 2016. The market
value is equal to the number of shares underlying the units times the closing market price of the Company's common stock on Friday, September 30, 2016, the last trading day of the Company's
fiscal year. The vesting schedule for each grant is shown below, with grants identified by the letter following the number of shares underlying the grant. Vesting of restricted stock units held by
named executive officers may be accelerated in the circumstances described under "
Potential Payments and Rights on Termination or Change in Control
,"
below.
Number; Market Value of Unearned Units That Have Not Vested.
These columns set forth the maximum number and market value, respectively,
of shares of the Company's common stock underlying each restricted stock unit award held by each named executive officer that is subject to performance-based vesting conditions and/or the test to
assure eligibility for deduction pursuant to Section 162(m), except that the number of units and market value for units granted December 19, 2013 are the actual amount that vested based
on the satisfaction of the related performance test on November 18, 2016 (excluding dividend equivalent units accruing after October 1, 2016). The number of shares includes dividend
equivalent units that have accrued for dividends payable through October 1, 2016. The market value is equal to the number of shares underlying the units multiplied by the closing market price
of the Company's common stock on Friday, September 30, 2016, the last trading day of the Company's fiscal year. The vesting schedule and performance tests and/or the test to assure eligibility
under Section 162(m) are shown in "
Vesting Schedule
," below.
Vesting Schedule.
The options reported above that are not yet
exercisable and restricted stock unit awards that have not yet vested are scheduled to become exercisable and vest as set forth below.
(A) Options
granted January 16, 2013. The remaining unexercisable options are scheduled to become exercisable on January 16, 2017.
(B) Options
granted December 19, 2013. One-half of the remaining unexercisable options vested on December 19, 2016 and one-half are scheduled to become
exercisable on December 19, 2017.
(C) Restricted
stock units granted December 19, 2013. The number of units shown reflects the amount that vested on December 19, 2016 based on the level at
which a total shareholder return and an earnings per share test were satisfied.
(D) Options
granted December 18, 2014. One-third of the remaining unexercisable options vested on December 18, 2016 and one-third are scheduled to become
exercisable on each of December 18, 2017 and 2018.
(E) Restricted
stock units granted December 18, 2014. The units are scheduled to vest on December 18, 2017 subject to determination that the test to assure
eligibility under Section 162(m) was satisfied and also subject to satisfaction of a total shareholder return and earnings per share test, with the number of units vesting depending on the
level at which the tests were satisfied. The amount shown is the maximum number of units that could vest.
(F) Options
granted December 17, 2015. One-fourth of the remaining unexercisable options vested on December 17, 2016 and one-fourth are scheduled to become
exercisable on each of December 17, 2017, 2018 and 2019.
(G) Restricted
stock units granted December 17, 2015. The units are scheduled to vest on December 17, 2018 subject to determination that the test to assure
eligibility under Section 162(m) was satisfied and also subject to satisfaction of a total shareholder return and earnings per share test, with the number of units vesting depending on the
level at which the tests were satisfied. The amount shown is the maximum number of units that could vest.
(H) Restricted
stock units granted January 16, 2013. The units are scheduled to vest on January 16, 2017.
(I) Restricted
stock units granted December 19, 2013 subject to performance tests. Approximately 87% of the remaining units vested on December 19, 2016 based
on the level at which a total shareholder return and an earnings per share test were satisfied. The remaining units vest on December 19, 2017,
Table of Contents
subject
to determination that the test to assure eligibility under Section 162(m) was satisfied.
(J) Restricted
stock units granted December 18, 2014 subject to performance tests. Approximately 11% of the units vested on December 18, 2016 and 11% of the
remaining units vest on each of December 18, 2017 and 2018, in each case subject to determination that the test to assure eligibility under Section 162(m) was satisfied. 67% of the
remaining units vest December 18, 2017 subject to determination that the test to assure eligibility under Section 162(m) was satisfied and also subject to satisfaction of a total
shareholder return and earnings per share test, with the number of units vesting depending on the level at which the tests were satisfied. The amount shown is the maximum number of units that could
vest.
(K) Restricted
stock units granted December 17, 2015 subject to performance tests. 10% of the units vested on December 17, 2016 and 10% of the remaining units
vest on each of December 17, 2017, 2018 and 2019, in each case subject to determination that the test to assure eligibility under Section 162(m) was satisfied. 60% of the remaining units
vest December 17, 2018 subject to determination that the test to assure eligibility under Section 162(m) was satisfied and also subject to satisfaction of a total shareholder return and
earnings per share test, with the number
of units vesting depending on the level at which the tests were satisfied. The amount shown is the maximum number of units that could vest.
(L) Restricted
stock units granted March 5, 2013. The remaining units are scheduled to vest on March 5, 2017.
(M) Restricted
stock units granted December 19, 2013. One-half of the remaining units vested on December 19, 2016 and one-half are scheduled to vest on
December 19, 2017.
(N) Options
granted December 18, 2014. One-half of the remaining unexercisable options
vested
on December 18, 2016 and one-half are scheduled to become exercisable on December 18, 2017. Excludes options that will not vest due to the timing of Mr. Staggs's
termination.
(O) Restricted
stock units granted December 18, 2014. One-half of the remaining units vested on December 18, 2016 and one-half are scheduled to vest on
December 18, 2017. Excludes restricted stock units that will not vest due to the timing of Mr. Staggs's termination.
(P) Restricted
stock units granted December 18, 2014 scheduled to vest on December 18, 2017, subject to satisfaction of a total shareholder return and earnings
per share test, with the number of units vesting depending on the level at which the tests were satisfied. The amount shown is the maximum number of units that could vest.
(Q) Options
granted February 5, 2015. One-half of the remaining unexercisable options are scheduled to become exercisable on each of February 5, 2017 and 2018.
Excludes options that will not vest due to the timing of Mr. Staggs's termination.
(R) Restricted
stock units granted February 5, 2015. The units are scheduled to vest on February 5, 2018 subject to satisfaction of a total shareholder return
and earnings per share test, with the number of units vesting depending on the level at which the tests were satisfied. The amount shown is the maximum number of units that could vest.
(S) Options
granted December 17, 2015. One-half of the remaining unexercisable options vested on December 18, 2016 and one-half are scheduled to become
exercisable on December 18, 2017. Excludes options that will not vest due to the timing of Mr. Staggs's termination.
(T) Excludes
restricted stock units granted December 17, 2015 that will not vest due to the timing of Mr. Staggs's termination.
Fiscal 2016 Option Exercises and Stock Vested Table
The
following table provides information concerning the exercise of options and vesting of restricted stock unit awards held by the named executive officers during fiscal 2016.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
Stock Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
Shares
Acquired on
Exercise
|
|
Value
Realized on
Exercise
|
|
|
|
|
|
Number of
Shares
Acquired on
Vesting
|
|
Value
Realized on
Vesting
|
|
|
|
|
Robert A. Iger
|
|
|
|
|
|
|
|
|
|
|
|
257,131
|
|
$24,621,167
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Alan N. Braverman
|
|
|
|
|
|
|
|
|
|
|
|
38,406
|
|
3,756,931
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Christine M. McCarthy
|
|
|
|
49,920
|
|
$4,007,337
|
|
|
|
|
|
19,334
|
|
1,892,116
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kevin A. Mayer
|
|
|
|
|
|
|
|
|
|
|
|
27,478
|
|
2,677,329
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
M. Jayne Parker
|
|
|
|
|
|
|
|
|
|
|
|
21,625
|
|
2,115,647
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Thomas O. Staggs
|
|
|
|
436,458
|
|
26,936,634
|
|
|
|
|
|
73,428
|
|
7,137,184
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
value realized on the exercise of options is equal to the amount per share at which the named executive officer sold shares acquired on exercise (all of which occurred on the date of exercise)
minus the exercise price of the option times the number of shares acquired on exercise of the options. The value realized on the
vesting of stock awards is equal to the closing market price of the Company's common stock on the date of vesting times the number of shares acquired upon
vesting. The number of shares and value realized on vesting includes shares that were withheld at the time of vesting to satisfy tax withholding requirements.
Continues on next page ►
|
|
The Walt Disney Company Notice of 2017 Annual Meeting and Proxy
Statement 43
|
Table of Contents
Equity Compensation Plans
The following table summarizes information, as of October 1, 2016, relating to equity compensation plans of the Company
pursuant to which grants of options, restricted stock, restricted stock units or other rights to acquire shares of the Company's common stock may be granted from time to time.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plan category
|
|
|
Number of securities
to be issued
upon exercise
of outstanding
options,
warrants and rights
(a)
|
|
Weighted-average
exercise price of
outstanding options,
warrants and rights
(b)
|
|
|
Number of securities
remaining available for
future issuance under
equity compensation
plans (excluding securities
reflected in column (a))
(c)
|
|
|
|
|
Equity compensation plans approved by security holders
1
|
|
|
35,581,052
|
2,3
|
$66.91
|
4
|
|
77,221,811
|
3,5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity compensation plans not approved by security holders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
35,581,052
|
2,3
|
$66.91
|
4
|
|
77,221,811
|
3,5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
1
-
These
plans are the Company's 2011 Stock Incentive Plan and The Walt Disney Company/Pixar 2004 Equity Incentive Plan (the Disney/Pixar Plan was
assumed by the Company in connection with the acquisition of Pixar).
-
2
-
Includes
an aggregate of 10,190,975 restricted stock units and performance-based restricted stock units. Also includes options to purchase an
aggregate of 50,250 shares at a weighted average exercise price of $32.56 and 188,921 restricted stock units, in each case granted under plans assumed by the Company in connection with the acquisition
of Pixar, which plans were approved by the shareholders of Pixar prior to the Company's acquisition.
-
3
-
Assumes
shares issued upon vesting of performance-based units vest at 100% of target number of units. Actual number of shares issued on vesting
of performance units could be zero to 150% of the target number of units.
-
4
-
Weighted
average exercise price of outstanding options; excludes restricted stock units and performance-based restricted stock units.
-
5
-
Includes
422,769 securities available for future issuance under plans assumed by the Company in connection with the acquisition of Pixar, which
plans were approved by the shareholders of Pixar prior to the Company's acquisition. Assumes all awards are made in the form of options. Each award of one restricted stock unit under the 2011 Stock
Incentive Plan reduces the number of shares available under the plan by two, so the number of securities available for issuance will be smaller to the extent awards are made as restricted stock units.
Pension Benefits
The
Company maintains a tax-qualified, noncontributory retirement plan, called the Disney Salaried Pension Plan D, for salaried employees who commenced employment before January 1, 2012.
Benefits are based on a percentage of total average monthly compensation multiplied by years of credited service. For service years after 2012, average monthly compensation includes overtime,
commission and regular bonus and is calculated based on the highest five consecutive years of compensation during the ten-year period prior to termination of employment or retirement, whichever is
earlier. For service years prior to 2012, average monthly compensation considers only base salary, benefits were based on a somewhat higher percentage of average monthly compensation, and benefits
included a flat dollar amount based solely on years and hours of service. Retirement benefits are non-forfeitable after three years of vesting service (five years of vesting service prior to 2012) or
at age 65 after one year of service. Actuarially reduced benefits are paid to participants whose benefits are non-forfeitable and who retire before age 65 but on or after age 55.
In
calendar year 2016, the maximum compensation limit under a tax-qualified plan was $265,000 and the maximum annual benefit that may be accrued under a tax-qualified defined benefit plan was
$210,000. To provide additional retirement benefits for key salaried employees, the Company maintains a supplemental
nonqualified, unfunded plan, the Amended and Restated Key Plan, which provides retirement benefits in excess of the compensation limitations and maximum benefit
accruals under tax-qualified plans. Under this plan, benefits are calculated in the same manner as under the Disney Salaried Pension Plan D, including the differences in benefit determination
for years before and after January 1, 2012, described above, except as follows:
-
-
starting on January 1, 2017, average annual compensation used for calculating benefits under the plans
for any participant will be capped at the greater of $1,000,000 and the participant's average annual compensation determined as of January 1, 2017;
-
-
benefits for persons who were
named executive officers on January 1, 2012 are limited to the amount the
executive officer would have received had the plan in effect prior to its January 1, 2012 amendment continued without change; and
-
-
deferred amounts of base salary for years prior to
2006 and equity compensation paid in lieu of bonus are
recognized for purposes of determining applicable retirement benefits.
Company
employees (including two of the named executive officers) who transferred to the Company from ABC, Inc. after the Company's acquisition of ABC
Table of Contents
are also eligible to receive benefits under the Disney Salaried Pension Plan A (formerly known as the ABC, Inc. Retirement Plan) and a Benefits
Equalization Plan which, like the Amended and Restated Key Plan, provides eligible participants retirement benefits in excess of the compensation limits and maximum benefit accruals that apply to
tax-qualified plans. A term of the 1995 purchase agreement between ABC, Inc. and the Company provides that employees transferring employment to coverage under a Disney pension plan will receive
an additional benefit under Disney plans equal to (a) the amount the employee would receive under the Disney pension plans if all of his or her ABC service were counted under the Disney pension
less (b) the combined benefits he or she receives under the
ABC plan (for service prior to the transfer) and the Disney plan (for service after the transfer). Both Mr. Iger and Mr. Braverman transferred
from ABC, and each receives a pension benefit under the Disney plans to bring his total benefit up to the amount he would have received if all his years of service had been credited under the Disney
plans. (The effect of these benefits is reflected in the present value of benefits under the Disney plans in the table below.)
As
of the end of fiscal 2016, Ms. McCarthy, Ms. Parker and Mr. Staggs were eligible for early retirement and Mr. Iger and Mr. Braverman were eligible for retirement.
The early retirement reduction is 50% at age 55, decreasing to 0% at age 65.
Fiscal 2016 Pension Benefits Table
The following table sets forth the present value of the accumulated pension benefits that each named executive officer is eligible to
receive under each of the plans described above.
|
|
|
|
|
|
|
|
|
|
Name
|
|
Plan Name
|
|
Number of
Years of
Credited
Service at
Fiscal Year End
|
|
|
|
Present Value of
Accumulated
Benefit at
Fiscal Year End
|
|
|
|
Disney Salaried Pension Plan D
|
|
17
|
|
|
|
$1,477,424
|
|
|
|
Disney Amended and Restated Key Plan
|
|
17
|
|
|
|
13,462,589
|
|
Robert A. Iger
|
|
Disney Salaried Pension Plan A
|
|
25
|
|
|
|
988,179
|
|
|
|
Benefit Equalization Plan of ABC, Inc.
|
|
25
|
|
|
|
7,801,671
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$23,729,863
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Disney Salaried Pension Plan D
|
|
14
|
|
|
|
$1,159,906
|
|
|
|
Disney Amended and Restated Key Plan
|
|
14
|
|
|
|
4,631,425
|
|
Alan N. Braverman
|
|
Disney Salaried Pension Plan A
|
|
9
|
|
|
|
260,711
|
|
|
|
Benefit Equalization Plan of ABC, Inc.
|
|
9
|
|
|
|
1,453,530
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$7,505,572
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Disney Salaried Pension Plan D
|
|
17
|
|
|
|
$1,103,470
|
|
Christine M. McCarthy
|
|
Disney Amended and Restated Key Plan
|
|
17
|
|
|
|
2,350,145
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$3,453,615
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Disney Salaried Pension Plan D
|
|
19
|
|
|
|
$910,366
|
|
Kevin A. Mayer
|
|
Disney Amended and Restated Key Plan
|
|
19
|
|
|
|
2,466,734
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$3,377,100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Disney Salaried Pension Plan D
|
|
28
|
|
|
|
$1,480,785
|
|
M. Jayne Parker
|
|
Disney Amended and Restated Key Plan
|
|
28
|
|
|
|
2,678,795
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$4,159,580
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Disney Salaried Pension Plan D
|
|
27
|
|
|
|
$1,364,612
|
|
Thomas O. Staggs
1
|
|
Disney Amended and Restated Key Plan
|
|
27
|
|
|
|
7,829,496
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$9,194,108
|
|
|
|
|
|
|
|
|
|
|
|
-
1
-
As
a result of Mr. Staggs's termination, his retirement date was October 1, 2016 and the present value of his retirement benefits
on the date of his retirement is accordingly less than the amount assuming he retires at age 65, which is the amount reported above.
These
present values assume that each named executive retires at age 65 (or their age on October 1, 2016, if older) for purposes of the Disney Salaried Pension Plan D and the Amended and
Restated Key Plan and age 62 (or their age on October 1, 2016, if older) for
purposes of the Disney Salaried Pension Plan A, and the Amended and Restated Benefit Equalization Plan of ABC, Inc. Age 65 is the normal
retirement age under each of the plans and is also the age at which unreduced benefits are payable, except the earliest age
Continues on next page ►
|
|
The Walt Disney Company Notice of 2017 Annual Meeting and Proxy
Statement 45
|
Table of Contents
at which unreduced benefits are payable under the ABC plans is age 62 for service years prior to 2012. The values also assume a straight life-annuity payment
for an unmarried participant. Participants may elect other actuarially reduced forms of payment, such as joint and survivor benefits and payment of benefits for a period certain irrespective of the
death of the participant. The present values were calculated using the 3.73% discount rate assumption set forth in footnote 10 to the Company's Audited Financial Statements for fiscal 2016 and using
actuarial factors including RP2014 annuitant mortality table, projected back to 2007 using the MP-2014 projection scale, and generationally with a modified version of the MP-2014 scale for males and
females. The present values reported in the table are not available as lump sum payment under the plans.
Fiscal 2016 Nonqualified Deferred Compensation Table
Under the Company's Non-Qualified Deferred Compensation Plan, U.S.-based executives at the level of Senior Vice President or above
may defer a portion of their compensation and applicable taxes with an opportunity to earn a tax-deferred return on the deferred amounts. The plan gives eligible executives the opportunity to defer up
to 50% of their base salary and up to 100% of their annual performance-based bonus award until retirement or termination of employment or, at the executive's election, until an earlier date at least
five years following the date the compensation is earned. The Company also has the option to make a contribution into an executive's deferred compensation account on terms and subject to any
conditions (such as vesting conditions) the Company chooses. Amounts in an executive's deferred account earn a return based on the executive's election among a series of mutual funds designated by the
Company, which are generally the same funds available under the Company's qualified deferred compensation plans. Returns on the funds available for the deferred account ranged from (18.27)% to 16.48%
for the year ended September 30, 2016. The deferred amounts and any deemed earnings on the amounts are not actual investments and are obligations of the Company. Ms. McCarthy,
Ms. Parker and Mr. Staggs participated in this plan in fiscal 2016, and their contributions and aggregate earnings during the fiscal year and aggregate balance at the end of the fiscal
year are reflected in the table below. Their contributions represent deferred salary (in the case of Ms. McCarthy) in the amount of $643,365 and bonus (in the cases of Ms. McCarthy,
Ms. Parker and
Mr. Staggs) in the amounts of $4,308,280, $1,729,984 and $1,400,000, respectively, and all are included in the amounts reported for salary and bonus in
the Summary Compensation Table for each of them.
In
addition, from 2000 through 2005, $500,000 per year of Mr. Iger's annual base salary was deferred. The following table sets forth the earnings on the deferred amount in fiscal 2016 and the
aggregate balance of Mr. Iger's deferral account, including accumulated earnings, as of October 1, 2016. Mr. Iger's employment agreement provides
that the deferred compensation will be paid, together with interest at the applicable federal rate for mid-term treasuries, reset annually, no later than 30 days after he is no longer subject
to the provisions of Section 162(m) of the Internal Revenue Code (or at such later date as is necessary to avoid the imposition of an additional tax on Mr. Iger under Section 409A
of the Internal Revenue Code). The interest rate is adjusted annually in March and the weighted average interest rate for fiscal 2016 was 1.476%. There were no additions during the fiscal year to the
deferred amount by either the Company or Mr. Iger other than these earnings and no withdrawals during the fiscal year.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive
Contributions
in Last
Fiscal Year
|
|
Aggregate
Earnings
in Last
Fiscal Year
|
|
|
Aggregate
Balance at
Last Fiscal
Year End
|
|
|
|
|
Robert A. Iger
|
|
|
|
$59,857
|
|
$
|
4,115,690
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Christine M. McCarthy
|
|
$4,951,645
|
|
$341,276
|
|
$
|
5,299,102
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
M. Jayne Parker
|
|
$1,729,984
|
|
$101,013
|
|
$
|
1,858,639
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Thomas O. Staggs
|
|
$1,400,000
|
|
$126,647
|
|
$
|
1,850,647
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contributions
by Ms. McCarthy, Ms. Parker and Mr. Staggs include deferral of non-equity incentive plan awards earned with respect to fiscal 2016 but awarded after the end of the
fiscal year. Because these deferrals did not occur until
after the end of the fiscal year, no earnings on these amounts are included in the column for Aggregate Earnings in Last Fiscal Year and these amounts are not included in the Aggregate Balance at Last
Fiscal Year End.
Because
the earnings accrued under these programs were not "above market" or preferential, these amounts are not reported in the Fiscal 2016 Summary Compensation Table. A portion of the aggregate
balances at last fiscal year end were however included
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in the Summary Compensation Table since fiscal year 2015, as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amount Included in Summary
Compensation Table
|
|
|
|
Fiscal Year
|
|
|
Salary
|
|
Non-Equity
Incentive Plan
|
|
|
Total
|
|
Robert A. Iger
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Christine M. McCarthy
|
|
2016
|
|
$
|
643,365
|
|
|
|
$
|
643,365
|
|
|
|
2015
|
|
$
|
216,971
|
|
$4,108,116
|
|
$
|
4,325,088
|
|
|
|
|
|
|
|
|
|
|
|
|
|
M. Jayne Parker
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
|
$1,757,626
|
|
$
|
1,757,626
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Thomas O. Staggs
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
|
$1,724,000
|
|
$
|
1,724,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Potential Payments and Rights on Termination or
Change in Control
Our named executive officers may receive compensation in connection with termination of their employment. This compensation is
payable pursuant to (a) the terms of compensation plans applicable by their terms to all participating employees and (b) the terms of employment agreements with each of our named
executive officers.
The
termination provisions serve a variety of purposes including: providing the benefits of equity incentive plans to the executive and his or her family in case of death or disability; defining when
the executive may be terminated with cause and receive no further compensation; and clearly defining rights in the event of a termination in other circumstances. The availability, nature and amount of
compensation on termination differ depending on whether employment terminates because of:
-
-
death or disability;
-
-
the Company's termination of the executive pursuant to the Company's termination right or the executive's
decision to terminate because of action the Company takes or fails to take;
-
-
the Company's termination of the executive for cause; or
-
-
expiration of an employment agreement, retirement or other voluntary termination.
The
compensation that each of our named executive officers other than Mr. Staggs may receive under each of these termination circumstances is described below. We also set forth below the effect
of Mr. Staggs's termination, which occurred at the end of the fiscal year.
It
is important to note that the amounts of compensation set forth in the tables below are based on the specific assumptions noted and do not predict the actual
compensation that our named executive officers would receive. Actual compensation received would be a function of a number of factors that are unknowable at
this time, including: the date of the executive's termination of employment; the executive's base salary at the time of termination; the executive's age and service with the Company at the time of
termination; and, because many elements of the compensation are performance-based pursuant to the Company's compensation philosophy described in
Compensation Discussion and
Analysis
, above, the future performance of the Company.
Moreover,
the option and restricted stock unit acceleration amounts in case of a termination without cause or by the executive for good reason assume that these awards immediately accelerate, which is
not the case in the absence of a change in control. Rather, options and units continue to vest over time and in most cases are subject to the same performance measures that apply if there had been no
termination. (The performance measures do not apply to vesting of restricted stock unit awards when termination is due to death or disability, and the test to assure deductibility under
Section 162(m) does not apply if it is not necessary to preserve deductibility.)
In
addition, although the descriptions and amounts below are based on existing agreements, in connection with a particular termination of employment the Company and the named executive officer may
mutually agree on severance terms that vary from those provided in his or her pre-existing agreement.
In
each of the circumstances described below, our named executive officers are eligible to receive earned, unpaid salary through the date of termination and benefits that are unconditionally accrued
as of the date of termination pursuant to policies applicable to all employees. This includes the deferred compensation and earnings on these deferred amounts as described under
"Deferred Compensation,"
above. This earned compensation is not described or quantified below because these amounts represent earned, vested benefits
that are not contingent on the termination of employment, but we do describe and quantify benefits that continue beyond the date of termination that are in
addition to those provided for in the applicable benefit plans. The executive's accrued benefits include the pension benefits described under
"Pension
Benefits,"
above, which become payable to all participants who have reached retirement age. Because they have reached early retirement or retirement age under the plans,
Mr. Iger, Mr. Braverman, Ms. McCarthy and Ms. Parker each would have been (and Mr. Staggs was) eligible to receive these benefits if their employment had
Continues on next page ►
|
|
The Walt Disney Company Notice of 2017 Annual Meeting and Proxy
Statement 47
|
Table of Contents
terminated at the end of fiscal 2016. Because the pension benefits available to Mr. Iger, Mr. Braverman, Ms. McCarthy, Ms. Parker
and Mr. Staggs upon termination do not differ from those described above under
"Pension Benefits"
except in ways that are equally applicable to
all salaried employees, the nature and amount of their pension benefits are not described or quantified below.
Death and Disability
The employment agreement of each named executive officer provides for payment of any unpaid bonus for any fiscal year that had been completed at the
time of the executive's death or termination of employment due to disability. The amount of the bonus will be determined by the Compensation Committee using the same criteria used for determining a
bonus as if the executive remained employed. In addition, Mr. Iger's employment agreement provides that if he dies or terminates employment due to disability prior to June 30, 2018 and
prior to the occurrence of a change in control, Mr. Iger (or his estate) will, following the completion of fiscal year 2018, receive a Growth Incentive Retention Payment based on the extent to
which the Company's cumulative adjusted operating income for the five years ending September 28, 2018 exceeds $76.01 billion, but pro-rated to reflect the period of his actual employment
after fiscal year 2014.
In
addition to the compensation and rights in employment agreements, the 2011 Stock Incentive Plan and award agreements thereunder provide that all options awarded to a participant (including the
named executive officers) become fully exercisable upon the death or disability of the participant and remain exercisable for 18 months in the case of death and 12 months (or
18 months in the case of participants who are eligible for immediate retirement benefits) in the case of disability, and all restricted stock units awarded to the participant under the 2011
Stock Incentive Plan will, to the extent the units had not previously been forfeited, fully vest and become payable upon the death or disability of the participant.
The
following table does not reflect any amount with respect to the Growth Incentive Retention Award because, if Mr. Iger's employment terminated at the end of fiscal 2016 due to death or
disability, no amount would be paid until after the end of fiscal 2018 and the amount of the award, if any, would depend on whether and to what extent the performance measure was met. The amount of
the award would be zero if cumulative adjusted operating income for the five fiscal years ending September 29, 2018 were less than $76.01 billion and, based on pro-ration through the end
of fiscal 2016, could reach $32.1 million
depending on the extent to which cumulative adjusted operating income exceeded $76.01 billion.
The
following table sets forth the value of the estimated payments and benefits each of our named executive officers would have received under our compensation plans and their employment agreements if
their employment had terminated at the close of business on the last day of fiscal 2016 as a result of death or disability. The value of option acceleration is equal to the difference between the
$92.86 closing market price of shares of the Company's common stock on September 30, 2016 (the last trading day in fiscal 2016) and the weighted average exercise price of options with an
exercise price less than the market price times the number of shares subject to such options that would accelerate as a result of termination. The value of restricted stock unit acceleration is equal
to the $92.86 closing market price of shares of the Company's common stock on September 30, 2016 multiplied by the number of units that would accelerate as a result of termination, which, for
performance-based units, is equal to the target number of units.
|
|
|
|
|
|
|
|
|
|
Cash
Payment
1
|
|
Option
Acceleration
|
|
Restricted
Stock Unit
Acceleration
|
|
Robert A. Iger
|
|
$20,000,000
|
|
$11,710,122
|
|
$26,649,567
|
|
|
|
|
|
|
|
|
|
Alan N. Braverman
|
|
5,440,000
|
|
1,533,582
|
|
5,286,388
|
|
|
|
|
|
|
|
|
|
Christine M. McCarthy
|
|
4,520,000
|
|
766,597
|
|
3,515,379
|
|
|
|
|
|
|
|
|
|
Kevin A. Mayer
|
|
4,520,000
|
|
1,046,453
|
|
4,341,374
|
|
|
|
|
|
|
|
|
|
M. Jayne Parker
|
|
1,815,000
|
|
912,016
|
|
3,645,769
|
|
|
|
|
|
|
|
|
|
-
1
-
This
amount is equal to the bonus awarded to the named executive officers with respect to fiscal 2016 and set forth in the "Non-Equity Incentive
Plan Compensation" column of the Fiscal 2016 Summary Compensation Table.
Termination Pursuant to Company Termination Right
Other than for Cause or by Executive for Good Reason
The employment agreement of each named executive officer provides that he or she will receive a bonus for any fiscal year that had been completed at
the time of his or her termination of employment if his or her employment is terminated by the Company pursuant to the Company's termination right other than for cause (as described below) or by the
named executive officer with good reason (as described below). The amount of the bonus will be determined by the Compensation Committee using the same criteria used for determining a bonus if the
executive remained employed.
In
addition, each named executive officer's employment agreement provides that he or she will receive the following compensation and rights conditioned on his or her executing a mutual release of
liability and (except in the case of Mr. Iger) agreeing to provide the Company
Table of Contents
with consulting services for a period of six months after his or her termination (or, if less, for the remaining term of his or her employment
agreement):
-
-
A lump sum payment to be made six months and one day after termination equal to the base salary the named
executive officer would have earned had he or she remained employed during the term of his or her consulting agreement or, in the case of Mr. Iger, equal to the base salary he would have earned
had he remained employed until the original scheduled expiration date of his employment agreement.
-
-
In the case of the named executive officers other than Mr. Iger, if the
consulting agreement was not
terminated as a result of his or her material breach of the consulting agreement, a further lump sum payment to be made six months and one day after termination of employment equal to the base salary
the named executive officer would have earned had he or she remained employed after the termination of his or her consulting agreement and until the original scheduled expiration date of his or her
employment agreement.
-
-
A bonus for the year in which he or she is terminated equal to a pro-rata portion of a target bonus amount
determined in accordance with his or her employment agreement.
-
-
All options that had vested as of the termination date or were scheduled to vest no later than three months
after the original contract termination date will remain or become exercisable as though the named executive officer were employed until that date. The options will remain exercisable until the
earlier of (a) the scheduled expiration date of the options and (b) three months after the original scheduled expiration date of his or her employment agreement. In addition, as is true
for all employees, options awarded after December 2009 (and at least one year before termination) will continue to vest (and remain exercisable) until the earlier of the expiration date of the option
and three years (five years for options granted after March 2011) after the termination date if the officer would be over 60 years of age and have more than 10 years of service as of
that date. Pursuant to employment agreements with each of the named executive officers with an employment agreement, the termination date for these purposes will be deemed to be the original contract
termination date. For any employee that is eligible for immediate retirement benefits, options awarded within, but less than, one year of termination will vest to the extent they are scheduled to vest
within three months of termination
The
employment agreements provide that the Company has the right to terminate the named executive officer's employment subject to payment of the foregoing compensation in its sole, absolute and
unfettered discretion for any reason or no reason whatsoever. A termination for cause does not constitute an exercise of this right and would be subject to the compensation provisions described below
under
"Termination for Cause."
The
employment agreements provide that a named executive officer can terminate his or her employment "for good reason" following notice to the Company within three months of his or her having actual
notice of the occurrence of any of the following events (except that the Company will have 30 days after receipt of the notice to cure the conduct specified in the notice):
(i) a
reduction in the named executive officer's base salary, annual target bonus opportunity or (where applicable) annual target long-term incentive award opportunity;
Continues on next page ►
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The Walt Disney Company Notice of 2017 Annual Meeting and Proxy
Statement 49
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Table of Contents
(ii) the
removal of the named executive officer from his or her position (including in the case of Mr. Iger, the failure to elect or reelect him as a member of the
Board of Directors or his removal from the position of Chairman);
(iii) a
material reduction in his or her duties and responsibilities;
(iv) the
assignment to him or her of duties that are materially inconsistent with his or her position or duties or that materially impair his or her ability to function in
his or her office;
(v) relocation
of his or her principal office to a location that is more than 50 miles outside of the greater Los Angeles area and, in the case of Mr. Iger, that is
also more than 50 miles from Manhattan; or
(vi) a
material breach of any material provision of his or her employment agreement by the Company.
A
named executive officer (or any employee holding equity awards) can also terminate "for good reason" after a change in control (as defined in the 2011 Stock Incentive Plan) if, within
12 months following the change in control, a "triggering event" occurs, and in that case the 2011 Stock Incentive Plan provides that any outstanding options, restricted stock units,
performance-based restricted stock units or other plan awards will generally become fully vested and, in certain cases, paid to the plan participant. A triggering event is defined to include:
(a) a termination of employment by the Company other than for death, disability or "cause;" or (b) a termination of employment by the participant following a reduction in position, pay
or other "constructive termination." Under the 2011 Stock Incentive Plan "cause" has the same meaning as in the named executive officer's employment agreement, as defined below under "Termination for
Cause". Any such payments that become subject to the excess parachute tax rules may be reduced in certain circumstances.
In
addition, Mr. Iger's employment agreement provides that if his employment is terminated by the Company under its termination rights or by Mr. Iger for good reason prior to
June 30, 2018, absent a change in control, Mr. Iger will receive a Growth Incentive Retention Award based on the Company's actual performance through the end of fiscal year 2018, but, if
his employment is terminated prior to the end of fiscal year 2017, pro-rated to reflect the period of his actual employment after fiscal year 2014.
The
following table does not reflect any amount with respect to the Growth Incentive Retention Award
in the absence of
a change in control because, if
Mr. Iger's employment terminated at the end of fiscal 2016, no amount would be paid until after the end of fiscal 2018 and the amount of the award, if any, would depend on whether and to what
extent the performance measure
was met. The amount of the award would be zero if cumulative adjusted operating income for the five fiscal years ending September 29, 2018 were less than
$76.01 billion and, based on pro-ration through the end of fiscal 2016, could reach $32.1 million depending on the extent to which cumulative adjusted operating income exceeded
$76.01 billion.
The
following table does not reflect any amount with respect to the Growth Incentive Retention Award
with
a change in control because Mr. Iger
was not entitled to any award if a change in control occurred on or prior to the end of fiscal year 2016. If a change in control occurs after fiscal year 2016, the amount of the Growth Incentive
Retention Award payable, if any, will be determined based on the actual cumulative adjusted operating income for each fiscal quarter in the performance period completed on or prior to the date the
change of control occurs, plus a projected measure of adjusted operating income for the remainder of the performance period, assuming that adjusted operating income grows at an annualized rate equal
to the compounded aggregate growth rate achieved from the beginning of the performance period to such last quarter ended coincident with or prior to the change of control. To receive the amount, if
any, payable in respect of the Growth Incentive Retention Award upon a change in control, Mr. Iger must generally remain employed until June 30, 2018. However, payment of such amount
will be made earlier in the event that his employment terminates due to his death, disability, a termination by the exercise of the Company's termination rights or a termination by Mr. Iger for
good reason.
Each
named executive officer's employment agreement specifies that any compensation resulting from subsequent employment will not be offset against amounts described above.
The
following table provides a quantification of benefits (as calculated in the following paragraph) each of our named executive officers would have received if their employment had been terminated at
the end of fiscal 2016 by the Company pursuant to its termination right or by the executive with good reason.
The
"option valuation" amount is (a) the difference between the $92.86 closing market price of shares of the Company's common stock on September 30, 2016 and the weighted average
exercise price of options with an exercise price less than the market price times (b) the number of options with in-the-money exercise prices that would become exercisable despite the
termination. The "restricted stock unit valuation" amount is the $92.86 closing market price on September 30, 2016 times the
Table of Contents
target number of units that could vest. However, as described above, options do not become immediately exercisable and restricted stock units do not immediately
vest (and would eventually vest only to the extent applicable performance conditions are met) absent a change in control. The actual value realized from the exercise of the options and the vesting of
restricted stock units may therefore be more or less than the amount shown below depending on changes in the market price of the Company's common stock and the satisfaction of applicable performance
tests.
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Cash
Payment
1
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Option
Valuation
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Restricted
Stock Unit
Valuation
|
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Robert A. Iger
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No change in control
|
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$
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24,375,000
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$
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11,710,122
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$
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26,649,567
|
|
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|
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Change in control
|
|
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24,375,000
|
|
|
11,710,122
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26,649,567
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|
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Alan N. Braverman
|
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|
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|
|
|
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|
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|
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No change in control
|
|
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7,787,500
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|
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1,533,582
|
|
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5,286,388
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|
|
|
|
|
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|
|
|
|
|
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Change in control
|
|
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7,787,500
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|
|
1,533,582
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|
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5,286,388
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Christine M. McCarthy
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No change in control
|
|
|
8,095,000
|
|
|
766,597
|
|
|
3,515,379
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in control
|
|
|
8,095,000
|
|
|
766,597
|
|
|
3,515,379
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|
|
|
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Kevin A. Mayer
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|
|
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|
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No change in control
|
|
|
8,095,000
|
|
|
1,046,453
|
|
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4,139,961
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in control
|
|
|
8,095,000
|
|
|
1,046,453
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|
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4,341,374
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|
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M. Jayne Parker
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No change in control
|
|
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2,094,404
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|
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688,274
|
|
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1,497,200
|
|
|
|
|
|
|
|
|
|
|
|
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Change in control
|
|
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2,094,404
|
|
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912,016
|
|
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3,645,769
|
|
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-
1
-
This
amount is equal to the bonus awarded to the named executive officers with respect to fiscal 2016 and set forth in the "Non-Equity Incentive
Plan Compensation" column of the Summary Compensation Table, plus the lump sum payments based on salary through the end of the employment term as described above.
Termination for Cause
Each named executive officer's employment agreement provides that, if his or her employment is terminated by the Company for cause, he or she will
only be eligible to receive the compensation earned and benefits vested through the date of termination, including any rights he or she may have under his or her indemnification agreement with the
Company or the equity plans of the Company.
"Termination
for Cause" is defined in Mr. Iger's employment agreement as termination by the Company due to (i) conviction of a felony or the entering of a plea of nolo contendere to a
felony charge; (ii) gross neglect, willful malfeasance or willful gross misconduct in connection with his employment which has had a material adverse effect on
the business of the Company, unless he reasonably believed in good faith that such act or non-act was in, or not opposed to, the best interests of the Company; (iii) his substantial and
continual refusal to perform his duties, responsibilities or obligations under the agreement that continues after receipt of written notice identifying the
duties, responsibilities or obligations not being performed; (iv) a violation that is not timely cured of any Company policy that is generally applicable to all employees or all officers of the
Company that he knows or reasonably should know could reasonably be expected to result in a material adverse effect on the Company; (v) any failure (that is not timely cured) to cooperate, if
requested by the Board, with any investigation or inquiry into his or the Company's business practices, whether internal or external; or (vi) any material breach that is not timely cured of
covenants relating to non-competition during the term of employment and protection of the Company's confidential information.
"Termination
for Cause" is defined in Mr. Braverman's, Ms. McCarthy's, Mr. Mayer's and Ms. Parker's employment agreement as termination by the Company due to gross
negligence, gross misconduct, willful nonfeasance or willful material breach of the agreement by the executive unless, if the Company determines that the conduct or cause is curable, such conduct or
cause is timely cured by the executive.
Expiration of Employment Term; Retirement
Each of the named executive officers is eligible to receive earned, unpaid salary and unconditionally vested accrued benefits if his or her
employment terminates at the expiration of his or her employment agreement or he or she otherwise retires, but except as described below they are not contractually entitled to any additional
compensation in this circumstance. If Mr. Iger retires at June 30, 2018 (the expiration date of his employment agreement), he will be entitled to receive a bonus based on a target bonus
award of $12 million, subject only to the satisfaction of the performance objectives applicable to assure that the bonus is deductible for federal income tax purposes as performance-based
compensation. If Mr. Iger retires at June 30, 2018, he will also be entitled to receive a Growth Incentive Retention Award to the extent the Company's cumulative adjusted operating
income for the five years ending September 29, 2018 exceeds $76.01 billion.
As
in the case of a termination under the Company's termination right other than for cause or the executive's right to terminate for good reason, vested options and restricted stock units will remain
exercisable for 18 months for executives eligible to receive retirement benefits, and options and restricted stock units outstanding for at least one year will continue to vest, and options
will remain exercisable, for up to three or five years (depending on the original grant date) if the
Continues on next page ►
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The Walt Disney Company Notice of 2017 Annual Meeting and Proxy
Statement 51
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Table of Contents
named executive officer was age 60 or greater and had at least ten years of service at the date of retirement. In addition, if Mr. Iger retires at
June 30, 2018, all options and restricted stock units awarded to him after June 30, 2016 will, subject to the satisfaction of applicable performance criteria, continue to vest and in the
case of options remain exercisable following his retirement according to their original vesting schedule and expiration date.
Compensation of Mr. Staggs
Mr. Staggs was employed pursuant to an employment agreement dated February 4, 2015, which contained provisions relating to compensation
upon termination by the Company pursuant to its termination right or by the executive because of action the Company takes or fails to take that are the same as those described above for
Mr. Iger, Mr. Braverman, Ms. McCarthy, Mr. Mayer and Ms. Parker. Mr. Staggs's service as Chief Operating Officer of the Company ended on May 6, 2016,
and he remained an employee of the Company as an Advisor to the Chief Executive Officer though the end of fiscal 2016 pursuant to the terms of his agreement. Based on a target bonus of $5,150,000, the
financial performance of the Company and an other performace factor of 100% (to reflect the contributions to that performance that Mr. Staggs made over the year), Mr. Staggs received a
performance-based bonus of $7 million, which the Committee, on Mr. Iger's recommendation, determined was appropriate in light of the role Mr. Staggs had played. In connection with
Mr. Staggs termination, he will be entitled, under his contract, to receive a lump sum payment of $3,605,000 six months after the date of his termination, which is equal to his salary from the
date his employment ended through the scheduled termination of his employment
agreement on June 30, 2018. This amount is included as "All Other Compensation" in the Summary Compensation Table on page 35.
In
addition, in accordance with the terms of his contract, Mr. Staggs's outstanding stock options continue to vest through September 30, 2018 (three months after the scheduled
termination of his employment agreement) and remain exercisable through December 30, 2019, and his restricted stock units continue to vest through June 30, 2018. While
the value of Mr. Staggs's options that will become exercisable will depend on the market price of the stock on the date of exercise, if calculated as of September 30, 2016, that value
would be $2,868,289 based on (a) the difference between the $92.86 closing market price of shares of the Company's common stock on that date and the weighted average exercise price of options
with an exercise price less than the market price times (b) the number of options with in-the-money exercise prices on that date that will become exercisable through the scheduled termination
of his employment agreement. The value of the restricted stock units that will continue to vest will likewise depend on the market price of the stock on the date of vesting, but as of
September 30, 2016 would be $7,460,710 based on $92.86 times the target number of units that could vest.
Certain
of the stock units held by Mr. Staggs are subject to performance tests, and he will realize no value if those tests are not met. If the performance tests are met, the value
Mr. Staggs realizes will depend on the extent to which the tests are met.
Table of Contents
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Audit-Related
Matters
|
Audit Committee Report
The charter of the Audit Committee of the Board specifies that the purpose of the Committee is to assist the Board in its oversight
of:
-
-
the integrity of the Company's financial statements;
-
-
the adequacy of the Company's system of internal controls;
-
-
the Company's compliance with legal and regulatory requirements;
-
-
the qualifications and independence of the Company's independent registered public accountants; and
-
-
the performance of the Company's independent
registered public accountants and of the Company's internal audit
function.
In
carrying out these responsibilities, the Audit Committee, among other things:
-
-
monitors preparation of quarterly and annual financial reports by the Company's management;
-
-
supervises the relationship between the
Company and its independent registered public accountants, including:
having direct responsibility for their appointment, compensation, retention and oversight; reviewing the scope of their audit services; approving audit and non-audit services; and confirming the
independence of the independent registered public accountants; and
-
-
oversees management's implementation and maintenance of effective systems of internal and disclosure controls,
including review of the Company's policies relating to legal and regulatory compliance, ethics and conflicts of interests and review of the Company's internal auditing program.
The
Committee met seven times during fiscal 2016. The Committee schedules its meetings with a view to ensuring that it devotes appropriate attention to all of its tasks. The Committee's meetings
include, whenever appropriate, executive sessions in which the Committee meets separately with the Company's independent registered public accountants, the Company's internal auditors, the Company's
chief financial officer and the Company's general counsel.
As
part of its oversight of the Company's financial statements, the Committee reviews and discusses with both management and the Company's independent
registered public accountants all annual and quarterly financial statements prior to their issuance. During fiscal 2016, management advised the Committee that
each set of financial statements reviewed had been prepared in accordance with generally accepted accounting principles, and management reviewed significant accounting and disclosure issues with the
Committee. These reviews included discussion with PricewaterhouseCoopers LLP, the Company's independent registered public accountants, of matters required to be discussed pursuant to
Public Company Accounting Oversight
Board Auditing Standard No. 16 (Communication With Audit Committees)
, including the quality of the Company's
accounting principles, the reasonableness of significant judgments and the clarity of disclosures in the financial statements. The Committee also discussed with PricewaterhouseCoopers LLP
matters relating to its independence, including a review of audit and non-audit fees and the written disclosures and letter from PricewaterhouseCoopers LLP to the Committee pursuant to
applicable requirements of the Public Company Accounting Oversight Board regarding the independent accountants' communications with the Audit Committee concerning independence.
In
addition, the Committee reviewed key initiatives and programs aimed at maintaining the effectiveness of the Company's internal and disclosure control structure. As part of this process, the
Committee continued to monitor the scope and adequacy of the Company's internal auditing program, reviewing internal audit department staffing levels and steps taken to maintain the effectiveness of
internal procedures and controls.
Taking
all of these reviews and discussions into account, the undersigned Committee members recommended to the Board that the Board approve the inclusion of the Company's audited financial statements
in the Company's Annual Report on Form 10-K for the fiscal year ended October 1, 2016, for filing with the Securities and Exchange Commission.
Members
of the Audit Committee
John S. Chen
Fred K. Langhammer
Aylwin B. Lewis
Robert W. Matschullat (Chair)
Continues on next page ►
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The Walt Disney Company Notice of 2017 Annual Meeting and Proxy
Statement 53
|
Table of Contents
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Policy for Approval of Audit and Permitted Non-audit Services
|
All audit, audit-related, tax and other services were pre-approved by the Audit Committee, which concluded that the provision of such services by
PricewaterhouseCoopers LLP was compatible with the maintenance of that firm's independence in the conduct of its auditing functions. The Audit Committee's Outside Auditor Independence Policy
provides for pre-approval of specifically described audit, audit-related, tax and other services by the Committee on an annual basis, but individual engagements anticipated to exceed
pre-established thresholds must be separately approved. The policy also requires specific approval by the Committee if total fees for audit-related, tax and
other services would exceed total fees for audit services in any fiscal year. The policy authorizes the Committee to delegate to one or more of its members pre-approval authority with respect to
permitted services, and the Committee has delegated to the Chairman of the Committee the authority to pre-approve services in certain circumstances.
|
Auditor Fees and Services
|
The following table presents fees for professional services rendered by PricewaterhouseCoopers LLP for the audit of the Company's annual financial
statements and internal control over financial reporting for fiscal 2016 and fiscal 2015, together with fees for audit-related, tax and other services rendered by PricewaterhouseCoopers LLP
during fiscal 2016 and fiscal 2015. Audit-related services consisted principally of audits of employee benefit plans and other entities related to the Company and other attest projects. Tax services
consisted principally of planning and advisory services and tax compliance assistance. Other services consisted of attestation reports on social, environmental and cultural disclosure required by law
or regulation. The Audit Committee directs and reviews the negotiations associated with the Company's retention of its independent registered public accountants.
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Fiscal 2016
|
|
Fiscal 2015
|
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(in millions)
|
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Audit fees
|
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$18.9
|
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$18.8
|
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Audit-related fees
|
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2.0
|
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2.4
|
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|
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|
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Tax fees
|
|
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|
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3.0
|
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|
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4.1
|
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All other fees
|
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0.1
|
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0.1
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Table of Contents
|
|
Items to Be
Voted On
|
Election of Directors
The
current term of office of all of the Company's Directors expires at the 2017 Annual Meeting. The Board proposes that all of the currently serving Directors be re-elected for a term of one year and
until their successors are duly elected and qualified. Each of the nominees has consented to serve if elected. If any of them becomes unavailable to serve as a Director before the 2017 Annual Meeting,
the Board may designate a substitute nominee. In that case, the persons named as proxies will vote for the substitute nominee designated by the Board.
Directors
are elected by a majority of votes cast unless the election is contested, in which case Directors are elected by a plurality of votes cast. A majority of votes cast means that the number of
shares voted "for" a Director exceeds the number of votes cast "against" the Director; abstentions are not counted either "for" or "against". If an incumbent Director in an uncontested election does
not receive a majority of votes cast for his or her election, the Director is required to submit a letter of resignation to the Board of Directors for consideration
by the Governance and Nominating Committee. The Governance and Nominating Committee is required to promptly assess the appropriateness of such nominee
continuing to serve as a Director and recommend to the Board the action to be taken with respect to the tendered resignation. The Board is required to determine whether to accept or reject the
resignation, or what other action should be taken, within 90 days of the date of the certification of election results.
Brokers
holding shares beneficially owned by their clients do not have the ability to cast votes with respect to the election of Directors unless they have received instructions from the beneficial
owner of the shares.
It is therefore important that you provide instructions to your broker if your shares are held by a broker so that your vote
with respect to Directors is counted.
The Board recommends a vote "FOR" each of the persons nominated by the Board.
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Susan E. Arnold, 62
, has been an operating executive of The Carlyle Group, an equity investment firm, since September 2013. She retired as President Global Business
Units of Procter & Gamble in 2009, a position she had held since 2007. Prior to 2007, she was Vice Chair of P&G Beauty and Health from 2006, Vice Chair of P&G Beauty from 2004 and President Global Personal Beauty Care and Global
Feminine Care from 2002. She was a director of McDonalds Corporation from 2008 to May 2016, and has been a director of NBTY, Inc. since 2013. Ms. Arnold has been a Director of the Company since 2007.
Ms. Arnold contributes to the mix of experience and qualifications the Board seeks to maintain primarily through her experience as an executive of Procter &
Gamble and her other public company board experience. At Procter & Gamble, Ms. Arnold was a senior executive responsible for major consumer brands in a large, complex retailing and global brand management company. As a result of this
experience, Ms. Arnold brings to our Board in-depth knowledge of brand management and marketing, environmental sustainability, product development, international consumer markets, finance and executive management, including executive
compensation and management leadership.
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Continues on next page ►
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The Walt Disney Company Notice of 2017 Annual Meeting and Proxy
Statement 55
|