Professional Documents
Culture Documents
Salary
Cash
incentive
Equity
incentive
Total direct
compensation
Table 1
2012(target
)
$1,500,000
2013
(target)
$1,500,000
$1,800,000
2012(102% 2012(real)
)
Same with $1,500,000
target
$1,836,000 $1,725,000
$7,700,000
$7,854,000
$11,000,00
0
$11,190,00
0
2013 (97%)
2013 (real)
$1,500,000
$1,800,000
Same with
target
$1,746,000
$7,525,000
$7,700,000
$7,469,000
$7,200,000
$10,750,00
0
$11,000,000
$10,715,000
$10,300,00
0
$1,600,000
With regard to tenure as CEO, prior to December 20th 2002, Mr. Clark served as COO. His tenure
served as CEO began from December 21st 2002. From succession planning, Mr. Bharat, a new
nominee, will become CEO on November 1st 2014. Thus, Mr. Clark ended tenure at end of
October 2014. His tenure lasted for almost 12 years.
In addition, the actual value of CEO severance package can only be determined at the time he
leaves the bank. Therefore, based on our investigation from fiscal year 2013, we cannot evaluate
this value before CEO termination. More importantly, Mr. Clark previous agreement was set to
expire on October 10th 2010. But he wanted to extend his tenure. This not only affected his
pension payment that would have been due to after October 2010 during the time he remains
employed by TD, but as part of the extension, he also agreed to waive his right to severance pay
under any circumstances. From table 2, it displays that the value of severance package was zero
no matter what reasons that CEO terminate his job.
Event
Resignation
Severance
Retirement
Severance
Termination without
cause
Severance
Termination with cause
Severance
Change of control
Severance
Table 2
Ed Clark
Eligible for
retirement
$0
$0
$0
$0
As table 2 mentioned above, there are four reasons that CEO many end his job: reassignment,
retirement, termination without cause and termination with cause. On April 3rd, 2013, Mr. Clark
announced his intention to retire as CEO effective Nov. 1st 2014. Thus, he ended his job because
of retirement.
Incentive (variable) compensation plan
Regarding incentive compensation set aside in 2013, at first, we should understand incentive
compensation for TD generally involves in cash incentive and equity incentive. The committee
allocated total variable compensation awards to the various member of the senior executive team
including the CEO. And then the committee evaluated individual performance to determine
individual awards including CEO and other named executives. Based on fiscal 2013, total
variable compensation was equal to 97% (business performance factor) of target compensation.
From table 1, we can find that the total incentive compensation for CEO was $1,746,000+
$7,469,000=$9,215,000.