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would lead to fewer options being granted at a higher
price.
Our solution, for grant purposes only, is to stabilize the
deemed present value of a stock option for a three-year
period. We think the use of such a value is more in line
with creating long-term shareholder value and pay-for-
performance, and allows us to better manage our burn
rate (number of shares granted each year divided by
the number of Common Stock outstanding) and budget
the number of awarded shares over the life of the share
authorization approved by shareholders.
For grants made in the three-year period of 2013 to
2015, our deemed fair value of a stock option is $13.73.
However, the actual per share exercise price under
each option in any event is the closing price of a
common share on the day it is granted.
COMPENSATION COMMITTEE REPORT
The Compensation Committee has reviewed and discussed the preceding CD&A with management and, based on that
review and discussion, has recommended to the Board of Directors to include the CD&A in this Proxy Statement.
Compensation Committee
Robert B. Johnson, Chairman
Douglas W. Johnson
David Gary Thompson
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