Invacare 2014 Annual Report Download - page 94

INVACARE CORPORATION AND SUBSIDIAIRIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
FS-24
In Europe, the Company maintains two defined benefit plans in Switzerland. In Switzerland, a statutory pension plan is
maintained with a private insurance company and, in accordance with Swiss law, the plan functions as a defined contribution plan
whereby employee and employer contributions are defined as a percentage of individual salary depending on the age of the
employee and a guaranteed interest rate, which is annually defined by the Swiss Pension Fund. Under U.S. GAAP, the plans are
treated as a defined benefit plans. During 2014, the Company terminated its plan in the Netherlands which contained benefits and
provisions for an Old Age Pension benefit that started at age 65 and were payable until death and a Survivors Pension that started
immediately after the death of the insured and is payable until the death of the surviving spouse. Under U.S. GAAP the plan was
treated as a defined benefit plan. Income for both the Switzerland and Netherlands plans was $220,000, $205,000 and $105,000
in 2014, 2013 and 2012, respectively.
Accumulated other comprehensive income associated with the SERP, DBO, Swiss and Netherlands pension plans combined
was $7,601,000 and $5,414,000 as of December 31, 2014 and 2013, respectively for a net change of $2,187,000 with $1,127,000
in net periodic benefit income recognized during the year.
Equity Compensation
The Company’s Common Shares have a $.25 stated value. The Common Shares and the Class B Common Shares generally
have identical rights, terms and conditions and vote together as a single class on most issues, except that the Class B Common
Shares have ten votes per share, carry a 10% lower cash dividend rate and, in general, can only be transferred to family members.
Holders of Class B Common Shares are entitled to convert their shares into Common Shares at any time on a share-for-share basis.
On May 16, 2013 shareholders approved the Invacare Corporation 2013 Equity Compensation Plan (the “2013 Plan”), which
was adopted on March 27, 2013 by the Company's Board of Directors (the “Board”). The Board adopted the 2013 Plan to replace
the Company's prior equity plan, the Invacare Corporation Amended and Restated 2003 Performance Plan (the “2003 Plan”),
which expired on May 21, 2013. Due to its expiration, no new awards may be granted under the 2003 Plan; however, awards
granted prior to its expiration will remain in effect under their original terms.
The 2013 Plan uses a fungible share-counting method, under which each common share underlying an award of stock
options or stock appreciation rights ("SAR") will count against the number of total shares available under the 2013 Plan as one
share; and each common share underlying any award other than a stock option or a SAR will count against the number of total
shares available under the 2013 Plan as two shares. Any common shares that are added back to the 2013 Plan as the result of the
cancellation or forfeiture of an award granted under the 2013 Plan will be added back in the same manner such shares were
originally counted against the total number of shares available under the 2013 Plan. Each common share that is added back to the
2013 Plan due to a cancellation or forfeiture of an award granted under the 2003 Plan will be added back as one common share.
The Compensation and Management Development Committee of the Board (the “Compensation Committee”), in its
discretion, may grant an award under the 2013 Plan to any director or employee of the Company or an affiliate. The 2013 Plan
initially allows the Compensation Committee to grant up to 4,460,337 common shares in connection with the following types of
awards with respect to shares of the Company's common shares: incentive stock options, nonqualified stock options, SARs,
restricted stock, restricted stock units, unrestricted stock and performance shares. The Compensation Committee also may grant
performance units that are payable in cash. The Compensation Committee has the authority to determine which participants will
receive awards, the amount of the awards and the other terms and conditions of the awards.
The 2013 Plan provides that shares granted come from the Company’s authorized but unissued common shares or treasury
shares. In addition, the Company’s stock-based compensation plans allow participants to exchange mature shares for minimum
withholding taxes, which results in the Company acquiring treasury shares. Under these provisions, the Company acquired
approximately 29,000 treasury shares for $471,000 in 2014, 23,000 shares for $532,000 in 2013 and 35,000 shares for $459,000
in 2012.