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Item 9A. Controls and Procedures

2021-11-19 compared with 2020-11-20 · 38 added, 35 removed, 185 unchanged (28% of the section changed)

14 unchanged sentences

In addition to the information reported in Part I of this Annual Report on Form 10-K, under the caption "Officers and Executive Management of the Registrant," the information required by this item as to the directors of the Company is hereby incorporated by reference from the information appearing under the captions "General Information Regarding Corporate Governance – Audit Committee," "Proposal No.

1 – Elections of Directors" and "Delinquent Section 16(a) Reports" in the Company's definitive proxy statement, which involves the election of the directors and is to be filed with the Securities and Exchange Commission (the "SEC") pursuant to the Exchange Act, within 120 days of the end of the Company's fiscal year ended September 30, 2020.

1 – Elections of Directors" and "Delinquent Section 16(a) Reports" (if applicable) in the Company's definitive proxy statement, which involves the election of the directors and is to be filed with the Securities and Exchange Commission (the "SEC") pursuant to the Exchange Act, within 120 days of the end of the Company's fiscal year ended September 30, 2021.

The Company's Code of Ethics Applicable to Executive Management is set forth in Exhibit 14.1 hereto.

10 unchanged sentences

There will be no further grants under the 2012 Equity Incentive Plan, the 2007 Equity Incentive Plan, or the 1992 Incentive Stock Plan.

At September 30, 2020, there were 1,700,000 shares reserved for future issuance under the 2017 Equity Incentive Plan.

565,860 restricted share units have been granted under the 2017 Equity Incentive Plan and are outstanding as of September 30, 2020.

In November 2021, the Board of Directors approved the Amended and Restated 2017 Equity Incentive Plan (the "Amended 2017 Plan"), which increases the maximum number of shares available for grants or awards to an aggregate of 3,450,000.

The Amended 2017 Plan is subject to shareholder approval at the February 2022 Annual Shareholder Meeting.

At September 30, 2021, 37,640 shares have been issued under the 2017 Equity Incentive Plan.

478,963 time-based restricted share units, 585,947 performance-based restricted share units, and 75,000 stock options have been granted under the 2017 Equity Incentive Plan.

1,087,445 of these share-based awards are outstanding as of September 30, 2021.

All plans are administered by the Compensation Committee of the Board of Directors.

With respect to outstanding restricted share grants, generally one-half of the shares vest on the third anniversary of the grant, one-quarter of the shares vest in one-third increments upon the attainment of pre-defined levels of adjusted earnings per share, and the remaining one-quarter of the shares vest in one-third increments upon attainment of pre-defined levels of appreciation in the market value of the Company's Class A Common Stock.

With respect to the restricted share grants, generally one-half of the shares vest on the third anniversary of the grant, one-quarter of the shares vest in one-third increments upon the attainment of pre-defined levels of adjusted earnings per share, and the remaining one-quarter of the shares vest in one-third increments upon attainment of pre-defined levels of appreciation in the market value of the Company's Class A Common Stock.

Additionally, restricted shares cannot vest until the first anniversary of the grant date.

1 unchanged sentence

The Company issues restricted shares from treasury shares.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT, continued

With respect to the restricted share unit grants, units generally vest on the third anniversary of the grant date.

The number of units that vest depend on certain time and performance thresholds.

Approximately thirty-eight percent of the shares vest based on time, while the remaining vest based on pre-defined performance thresholds.

Such performance thresholds include adjusted earnings per share, return on invested capital, appreciation in the market value of the Company's Class A Common Stock, or other targets established by the Compensation Committee of the Board of Directors.

Approximately 42% of the outstanding share units vest based on time, while the remaining vest based on pre-defined performance thresholds.

The Company issues common stock from treasury shares once vested.

With respect to outstanding stock option grants, options vest in one-third increments annually over three years from the grant date.

Unvested stock options expire on the earlier of five years from the date of grant, or upon employment termination, retirement or death.

The Company generally settles employee stock option exercises with treasury shares.

The Company maintains the 2019 Director Fee Plan, the Amended and Restated 2014 Director Fee Plan and the 1994 Director Fee Plan (collectively, the "Director Fee Plans").

7 unchanged sentences

Additionally, non-employee directors each receive an annual stock-based grant (non-statutory stock options, stock appreciation rights and/or restricted shares or units) with a value of $125,000 for fiscal year 2021.

241,378 restricted shares and restricted share units have been granted under the Director Fee Plans, 68,149 of which were issued under the 2019 Director Fee Plan and are unvested at September 30, 2020.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT, continued

As of September 30, 2021, 271,807 restricted shares and restricted share units have been granted under the Director Fee Plans, 98,578 of which were issued under the 2019 Director Fee Plan.

74,639 restricted shares and restricted share units are unvested at September 30, 2021.

The following table provides information about grants under the Company's equity compensation plans as of September 30, 2021:

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Equity compensation plans approved by security holders 113,657 (1)

3,185,283 (3)

Equity compensation plans not approved by security holders None None None

Total 113,657 $ 41.70 3,185,283

(1) Includes (1) the 2017 Equity Incentive Plan, which provides for the grant or award of stock options, restricted shares, stock-based performance units and certain other types of stock based awards;

(2) the 2019 Director Fee Plan, which provides for the grant, award or deferral of stock options, restricted shares, stock-based performance units and certain other types of stock based awards and compensation;

(1) Includes (1) deferred awards under Director Fee Plans;

and (2) outstanding stock options.

(2) Weighted-average exercise price of outstanding stock options included in column (a).

(3) Includes (1) shares reserved under the 2017 Equity Incentive Plan, which provides for the grant or award of stock options, restricted shares, stock-based performance units and certain other types of stock based awards;

(2) shares reserved under the 2019 Director Fee Plan, which provides for the grant, award or deferral of stock options, restricted shares, stock-based performance units and certain other types of stock based awards and compensation;

and (3) the shares purchased under the Employee Stock Purchase Plan which are purchased in the open market by employees at the fair market value of the Company's stock.

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Consolidated Balance Sheets as of September 30, 2021 and 2020 39

Consolidated Statements of Income for the years ended September 30, 2020, 2019 and 2018 40

Consolidated Statements of Comprehensive Income for the years ended September 30, 2020, 2019 and 2018 41

Consolidated Statements of Income (Loss) for the years ended September 30, 2021, 2020 and 2019 41

Consolidated Statements of Comprehensive Income (Loss) for the years ended September 30, 2021, 2020 and 2019 42

Consolidated Statements of Shareholders' Equity for the years ended September 30, 2021, 2020 and 2019 43

1 unchanged sentence

Notes to Consolidated Financial Statements 45

Supplementary Financial Information (unaudited) 76

Financial Statement Schedules:

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3.1 Restated Articles of Incorporation* Exhibit Number 3.1 to the Annual Report on Form 10-K for the year ended September 30, 1994

3.2 Restated By-laws, Amended July 20, 2017 *

Exhibit Number 3.1 to the Current Report on Form 8-K filed on July 26, 2017

3.2 Restated By-laws, as amended January 8, 2021 *

Exhibit Number 3.1 to the Current Report on Form 8-K filed on January 14, 2021

4.1 a Form of Revised Option Agreement of Repurchase (effective October 1, 1993)* Exhibit Number 4.5 to the Annual Report on Form 10-K for the year ended September 30, 1993

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4.6 Description of Securities *

Filed Herewith

10.1 Purchase Agreement dated December 1, 2017 by and among Matthews International Corporation Guarantors and J.P.

Morgan Securities LLC *

Exhibit Number 10.1 to the Current Report on Form 8-K filed on December 7, 2017

Exhibit 4.6 to the Annual Report on Form 10-K for the year ended September 30, 2020

10.1 Shareholder's Agreement, dated as of March 16, 2014, by and among Matthews International Corporation, the Shareholders named therein and David A.

1 unchanged sentence

Exhibit Number 10.2 to the Current Report on Form 8-K filed on March 19, 2014

10.3 a Employment Agreement as of the 29th day of July 2014, by and between Matthews International Corporation, a Pennsylvania corporation, and David Schawk

Exhibit A to the Definitive Proxy Statement on Schedule 14A filed on January 20, 2015

10.2 a Form of Schawk Family Share Purchase Agreement *

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Exhibit Number 10.5 to the Annual Report on Form 10-K for the year ended September 30, 2010

10.4 a Amendment to the Supplemental Retirement Plan

Filed herewith

10.5 a Officers Retirement Restoration Plan (effective

1 unchanged sentence

Exhibit Number 10.6 to the Annual Report on Form 10-K for the year ended September 30, 2009

MATTHEWS INTERNATIONAL CORPORATION AND SUBSIDIARIES

EXHIBITS INDEX, Continued

Description Prior Filing or Sequential Page Numbers Herein

10.7 a 1992 Stock Incentive Plan (as amended through

April 25, 2006) *

Exhibit Number 10.1 to the Quarterly Report on Form 10-Q for the quarter ended March 31, 2006

10.8 a Form of Stock Option Agreement *

Exhibit Number 10.7 to the Annual Report on Form 10-K for the year ended September 30, 2008

10.9 a Form of Restricted Stock Agreement *

Exhibit Number 10.8 to the Annual Report on Form 10-K for the year ended September 30, 2008

10.6 a Amendment to the Officers Retirement Restoration Plan

Filed herewith

10.7 a 1994 Director Fee Plan (as amended through

1 unchanged sentence

Exhibit Number 10.7 to the Annual Report on Form 10-K for the year ended September 30, 2013

MATTHEWS INTERNATIONAL CORPORATION AND SUBSIDIARIES

EXHIBITS INDEX, Continued

Description Prior Filing or Sequential Page Numbers Herein

10.8 a Amended and Restated 2014 Director Fee Plan *

2 unchanged sentences

Exhibit Number 10.2 to the Quarterly Report on Form 10-Q for the quarter ended March 31, 1995

10.13 a 2007 Equity Incentive Plan (as amended through September 26, 2008) *

Exhibit Number 10.11 to the Annual Report on Form 10-K for the year ended September 30, 2008

10.10 a 2012 Equity Incentive Plan *

14 unchanged sentences

Exhibit Number 10.1 to the Current Report on Form 8-K filed on March 30, 2020

10.18 First Amendment to Third Amended and Restated Loan Agreement *

Exhibit Number 10.1 to the Quarterly Report on Form 10-Q filed on April 30, 2021

14.1 Form of Code of Ethics Applicable to Executive Management *

2 unchanged sentences

Filed Herewith

MATTHEWS INTERNATIONAL CORPORATION AND SUBSIDIARIES

EXHIBITS INDEX, Continued

Description Prior Filing or Sequential Page Numbers Herein

23.1 Consent of Independent Registered Public Accounting Firm

7 unchanged sentences

Furnished Herewith

MATTHEWS INTERNATIONAL CORPORATION AND SUBSIDIARIES

EXHIBITS INDEX, Continued

Description Prior Filing or Sequential Page Numbers Herein

32.2 Certification Pursuant to 18 U.S.C.

39 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures