World Fuel Services 2013 Annual Report Download - page 72

As of December 31, 2013, the approximate future minimum commitments under these agreements, excluding discretionary and
performance bonuses, are as follows (in thousands):
Year Ended December 31,
2014 $ 8,188
2015 6,090
2016 1,365
$15,643
Named Executive Officer Annual Incentive Awards
In 2013, Paul H. Stebbins, Michael J. Kasbar, Ira M. Birns and Michael S. Clementi, referred to collectively in this 2013 10-K Report as
the Named Executive Officers (or ‘‘NEOs’’), were eligible to receive annual share-based incentive awards (the ‘‘share-based awards’’),
which are specified as dollar amounts, and, in the case of Messrs. Kasbar, Birns and Clementi, annual cash incentive awards (the ‘‘cash
awards’’), each upon the achievement of certain annual performance targets. The performance targets for the NEOs were generally
based on the growth of our net income except that the performance targets for Mr. Clementi were generally based on achieving
certain levels of aviation net operating income.
Earned cash awards are generally paid in the year immediately following the performance year, and we would record the earned cash
awards as compensation expense during the performance year. Earned share-based awards will be converted to the appropriate
number of equity shares (in the form of RSUs) at the prevailing fair value amount on the grant date, which will occur in the year
following the performance year. The equity shares will be granted under our 2006 Plan and will fully vest between 3-5 years. For
accounting purposes, the share-based awards are accounted for as liability awards during the performance year until granted, when
the share-based payment awards will be accounted for as equity awards. We would record compensation expense for the share-based
awards proportionately at the start of the performance period until the end of the equity grant’s service vesting period, and we would
record a corresponding liability amount until the equity shares are granted. When the equity shares are granted, we will reclassify the
outstanding liability amount to capital in excess of par value and record the amortization of the equity shares to capital in excess of par
value.
The following table sets forth the cash and share-based awards earned by our NEOs, subject to future vesting terms, and the
compensation expense recorded for these awards for the periods presented (in thousands):
2013 2011
Cash awards earned $2,249 $ 9,275
Share-based awards earned 1,646 9,604
Total earned $3,895 $18,879
Compensation expense recorded* $2,636 $11,535
* The remaining compensation expense will be recorded in future periods corresponding with the share-based awards’ vesting terms.
There were no cash or share-based awards earned by our NEOs in 2012. Cash and share-based awards earned by our former Chief
Risk and Administration Officer, an NEO during 2011, are included in the above table.
Deferred Compensation Plans
We maintain a 401(k) defined contribution plan which covers all U.S. employees who meet minimum requirements and elect to
participate. Additionally, certain of our foreign subsidiaries have defined contribution plans, which allow for voluntary contributions by
the employees. The expenses for our contributions under these plans were not significant during each of the years presented on the
consolidated statements of income and comprehensive income.
Environmental and Other Liabilities; Uninsured Risks
We provide various services to customers, including into-plane fueling at airports, fueling of vessels in-port and at-sea, and
transloading, transportation and storage of fuel and fuel products. We are therefore subject to possible claims by customers,
regulators and others who may be injured by a fuel spill or other accident. In addition, we may be held liable for damages to the
environment arising out of such events. Although we generally maintain liability insurance for these types of events, such insurance
may be inadequate. If we are held liable for any damages, and the liability is not adequately covered by insurance and is of sufficient
magnitude, our financial position and results of operations will be adversely affected.
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