Document:

Exhibit 10(a) 12.31.2014 Q2 10Q

Exhibit 10(a)
SUMMARY OF DIRECTOR AND NAMED EXECUTIVE OFFICER COMPENSATION
This summary sets forth the compensation of the Directors of Kimball International, Inc. (the “Company”).  On October 29, 2014, in conjunction with the completion of the spin-off of Kimball Electronics, Inc. from the Company (the “Spin-Off”), Douglas A. Habig and James C. Thyen retired from the Board of Directors of the Company (the “Board”), and Douglas A. Habig resigned as Chairman of the Board.  In addition, on October 29, 2014, Donald D. Charron resigned from the Board in order to serve as Chairman of the Board of Directors and Chief Executive Officer at Kimball Electronics, Inc.  On October 31, 2014, Robert F. Schneider assumed the position of Chairman of the Board.  
The summary also includes compensation of the Company's current Chief Executive Officer, President and Chief Operating Officer, and Chief Financial Officer.  On October 31, 2014, in conjunction with the completion of the Spin-Off, James C. Thyen retired as President, Chief Executive Officer of the Company.  On October 31, 2014, Donald D. Charron resigned from his position as Executive Vice President of Kimball International, President-Kimball Electronics Group to serve as Chief Executive Officer of Kimball Electronics, Inc.  Also on October 31, 2014, John H. Kahle resigned from his position of Executive Vice President, General Counsel, Secretary of the Company to serve as Vice President, General Counsel and Secretary of Kimball Electronics, Inc.  In addition, as of the spin-off date, Robert F. Schneider was promoted to Chief Executive Officer of Kimball International, Inc., Donald W. Van Winkle was promoted to President, Chief Operating Officer of Kimball International, Inc., and Michelle R. Schroeder was promoted to Vice President, Chief Financial Officer of Kimball International, Inc.  For purposes of this summary, Robert F. Schneider, Donald W. Van Winkle, and Michelle R. Schroeder constitute the Company's “Named Executive Officers.”
For a detailed description of the compensation arrangements that the Directors and Named Executive Officers participate in, refer to the Company's most recent Proxy Statement filed with the Securities and Exchange Commission.
Director Compensation
All Outside (non-employee) Directors receive annual compensation of $75,000 for the year for service as Directors.  The Chairperson of the Audit Committee of the Board of Directors and the Chairperson of the Compensation and Governance Committee of the Board of Directors each receive an additional $10,000 annual retainer fee.
The Directors can elect to receive all of their annual retainer fees in shares of Common Stock under the Company's 2003 Amended and Restated Stock Option and Incentive Plan.  Directors are also reimbursed for travel expenses incurred in connection with Board and Committee meeting attendance.
An Outside Director is a director who is not an employee of the Company or one of its subsidiaries.  Robert F. Schneider, Chairman of the Board and Chief Executive Officer, is a Director of the Company but does not receive compensation for his service as a Director.
Named Executive Officer Compensation
Base Pay
Periodically, the Compensation and Governance Committee of the Board of Directors reviews and approves the salaries that are paid to the Company's executive officers.  The following are the current annualized base salaries for the Company's Named Executive Officers:
	
				
	Robert F. Schneider, Chief Executive Officer
	$
	550,000
	

	Donald W. Van Winkle, President, Chief Operating Officer
	$
	401,804
	

	Michelle R. Schroeder, Vice President, Chief Financial Officer
	$
	320,008
	

Cash Incentive Compensation
Each of the Named Executive Officers was eligible to participate in the Company's 2010 Profit Sharing Incentive Bonus Plan (the “Plan”) for fiscal year 2014.  A long-standing component of the Company's profit sharing incentive bonus plan is that it is linked to the Company's worldwide, group, or business unit performance which adjusts compensation expense as profits change.  Under the Plan, cash incentives are accrued annually and paid in five installments over the succeeding fiscal year.  Except for provisions relating to retirement, death, permanent disability, and certain other circumstances described in a participant's employment agreement, participants must be actively employed on each payment date to be eligible to receive any unpaid cash incentive installment.  The total amount of cash incentives accrued and authorized to be paid to the Named Executive Officers based on the Company's fiscal year 2014 results is listed below.  The Named Executive Officers received an installment of 50% of the payment in August 2014, 12.5% was paid in both September 2014 and January 2015, and the remaining portions will be paid in equal installments in April 2015 and June 2015.
	
				
	Robert F. Schneider, Chief Executive Officer
	$
	407,745
	

	Donald W. Van Winkle, President, Chief Operating Officer
	$
	223,431
	

	Michelle R. Schroeder, Vice President, Chief Financial Officer
	$
	213,860
	

Donald W. Van Winkle and Michelle R. Schroeder were also awarded discretionary compensation of $50,000 and $60,000, respectively, in December 2014 in recognition of their efforts with the spin-off of Kimball Electronics.
Stock Compensation
The Named Executive Officers may also receive a variety of stock incentive benefits under the Amended and Restated 2003 Stock Option and Incentive Plan consisting of: restricted stock, restricted share units (“RSU”), unrestricted share grants, incentive stock options, nonqualified stock options, stock appreciation rights, performance shares, and performance units.  During August 2013 the Named Executive Officers were awarded grants of performance shares.  Performance shares include both an annual performance share (“APS”) award and a long-term performance share (“LTPS”) award with one-fifth (1/5) of the LTPS award vesting annually over the succeeding five-year period.
The following table summarizes the performance shares issued in Class A Common Stock during August 2014 to the Company's Named Executive Officers pursuant to their August 2013 performance share awards:
	
						
	 
	APS Award 
(number of
 shares issued) (1)
	 
	LTPS Award 
(number of
 shares issued) (1)

	Robert F. Schneider, Chief Executive Officer
	6,375
	

	 
	31,500
	

	Donald W. Van Winkle, President, Chief Operating Officer
	4,425
	

	 
	22,020
	

	Michelle R. Schroeder, Vice President, Chief Financial Officer
	2,975
	

	 
	7,700
	

	 
	 
	 
	 

	(1) Shares have not been reduced by the number of shares withheld to satisfy tax withholding obligations.

The following table summarizes the maximum number of performance shares awarded in June 2014 to the Company's Named Executive Officers for fiscal year 2015: 
	
						
	 
	APS Award
 (number of
 shares) (1)
	 
	LTPS Award
 (number of
 shares) (1)

	Robert F. Schneider, Chief Executive Officer
	8,480
	

	 
	27,200
	

	Donald W. Van Winkle, President, Chief Operating Officer
	8,480
	

	 
	27,200
	

	Michelle R. Schroeder, Vice President, Chief Financial Officer
	4,000
	

	 
	7,520
	

	 
	 
	 
	 

	(1) Shares have been increased due to the Spin-Off by an adjustment factor of 1.60.

The number of shares to be issued will be dependent upon the percentage payout under the Plan. Refer to the Company's Proxy Statement for further details.

In December 2014, the Company granted RSUs to each of the Named Executive Officers.  The RSU awards are structured as a retention tool with vesting occurring at the end of each of the Company's next three fiscal years ending June 30, 2015, June 30, 2016, and June 30, 2017.  The RSUs accumulate dividends during the vesting periods.  With the promotions occurring mid-fiscal year, the first year tranche was pro-rated.
	
												
	 
	 
	 
	Shares Vesting On

	 
	Total RSUs Awarded
	 
	June 30, 2015
	 
	June 30, 2016
	 
	June 30, 2017

	Robert F. Schneider
	60,675
	

	 
	15,169
	

	 
	22,753
	

	 
	22,753
	

	Donald W. Van Winkle
	29,848
	

	 
	7,462
	

	 
	11,193
	

	 
	11,193
	

	Michelle R. Schroeder
	7,584
	

	 
	1,896
	

	 
	2,844
	

	 
	2,844
	

Retirement Plans
The Named Executive Officers participate in a defined contribution, participant-directed retirement plan that all domestic employees are eligible to participate in (the “Retirement Plan”).  The Retirement Plan provides for voluntary employee contributions as well as a discretionary Company contribution which is determined annually by the Compensation and Governance Committee of the Board of Directors.  Each eligible employee's Company contribution is defined as a percent of eligible compensation, the percent being identical for all eligible employees, including Named Executive Officers.  Participant contributions are fully vested immediately, and Company contributions are fully vested after five years of participation.  All Named Executive Officers are fully vested.  The Retirement Plan is fully funded.  For those eligible employees who, under the 1986 Tax Reform Act, are deemed to be highly compensated, their individual Company contribution under the Retirement Plan is reduced.  For employees who are eligible, including all Named Executive Officers, there is a nonqualified, Supplemental Employee Retirement Plan (“SERP”) in which the Company contributes to the account of each individual an amount equal to the reduction in the contribution under the Retirement Plan arising from the provisions of the 1986 Tax Reform Act. The SERP investment is primarily composed of employee contributions.Exhibit 10(c) Amended LTPS APS Award

Exhibit 10(c)
KIMBALL INTERNATIONAL, INC.
AMENDMENT OF ANNUAL AND/OR LONG-TERM PERFORMANCE SHARE AWARDS 

This Amendment (“Amendment”) is dated February ___, 2015 by and between Kimball International, Inc. (“Company”), and ________________ (“Recipient”) pursuant to the terms of certain Annual Performance Share Award Agreement(s) and/or Long-Term Performance Share Award Agreement(s) as noted below (“Agreements”).
WHEREAS Recipient has been previously awarded by Kimball International, Inc. certain Annual and/or Long-Term Performance Share Awards (“Awards”), some of which remain outstanding, as follows:
	
			
	Performance Share Type
	Date of Award Agreement
	KII Share Awards Outstanding

	Long Term
	 
	 

	Long Term
	 
	 

	Long Term
	 
	 

	Long Term
	 
	 

	Long Term
	 
	 

	Annual
	 
	 

AND WHEREAS each of such Agreements made provision for the appropriate equitable adjustment of the Awards in the event of a reorganization, sale, merger, consolidation or other similar transaction in a manner to be selected by the Compensation and Governance Committee of the Board of Directors of Kimball International, Inc. (“Committee”).
AND WHEREAS Kimball International, Inc. completed a spin-off of its electronics business by a distribution to the Company's shareholders of all the shares of common stock of Kimball Electronics, Inc. on October 31, 2014 (the “Spin-off”), and the concurrent unification of Class A and Class B common stock resulting in the elimination of all distinctions between Class A common stock and Class B common stock so that all shares of Class B common stock are equal to shares of Class A common stock with respect to all matters, including without limitation, dividend payments and voting rights.
AND WHEREAS the Committee has determined that an appropriate equitable adjustment of the Awards as a result of the Spin-off is to multiply each outstanding Award by a factor of 1.60.

Now therefore, in consideration of these premises, the Company and Recipient hereby agree as follows:
AWARDS
The Awards shall be adjusted in the amounts as noted below, to be granted in shares of Company common stock:
	
					
	Performance Share Type
	Date of Award Agreement
	Number of KII Shares Awarded
	Adjustment Factor
	Number of remaining KII Shares Outstanding

	Long Term
	 
	 
	1.6
	 

	Long Term
	 
	 
	1.6
	 

	Long Term
	 
	 
	1.6
	 

	Long Term
	 
	 
	1.6
	 

	Long Term
	 
	 
	1.6
	 

	Annual
	 
	 
	1.6
	 

AWARDS OF SHARES
The number of shares earned under the Awards will be determined by the applicable bonus percentages as noted in each of the Agreements computed under the Company’s Profit Sharing Incentive Bonus Plan for the applicable fiscal year(s) ending June 30 - beginning with the fiscal year ending June 30, 2015.
CONVERSION OF SHARE AWARDS
In accordance with the terms of the Articles of Incorporation and Bylaws of Kimball International, Inc., as a result of the stock unification, Class A and Class B shares now have equal rights, preferences, limitations and restrictions.  Therefore, all future shares issued pursuant to the Awards shall be issued as KBAL Class B shares rather than Class A shares to the extent the latter were designated as the shares of choice for the Awards.
ASSIGNMENT AND OTHER TERMS
This Agreement shall be assignable by the Company to any successors, assigns, successors in interest, affiliates or subsidiaries.  All other terms and conditions of the Agreements, except as modified by this Amendment, shall remain in full force and effect.
IN WITNESS WHEREOF, the Company and the Recipient have agreed to the terms and conditions of this Amendment all as of the day and date first above written.
	
					
	The Company
	 
	Recipient

	 
	 
	 
	 
	 

	By:
	/s/ Julia Heitz Cassidy
	 
	By:
	 

	 
	JULIA HEITZ CASSIDY
Vice President,
General Counsel, Secretary
Kimball International, Inc.
	 
	 
	 

	 
	 
	 
	 
	(printed)

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