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Section 1: DEF 14A (DEF 14A)

Document
SCHEDULE 14A
(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
 
 
 
Check the appropriate box:
 
 
[ ]
 
Preliminary Proxy Statement
[ ]
Soliciting Material Under Rule 14a-12
[ ]
 
Confidential, For Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
[X]
 
Definitive Proxy Statement
 
[ ]
 
Definitive Additional Materials
 

VISHAY PRECISION GROUP, INC.
(Name of Registrant as Specified In Its Charter)
 
 
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):
[X]
 
No fee required.
[ ]
 
Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
 
 
1)
 
Title of each class of securities to which transaction applies:
 
 
 
 
 
 
 
2)
 
Aggregate number of securities to which transaction applies:
 
 
 
 
 
 
 
3)
 
Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
 
 
 
 
 
 
 
4)
 
Proposed maximum aggregate value of transaction:
 
 
 
 
 
 
 
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Total fee paid:
 
 
 
 
 
[ ]
 
Fee paid previously with preliminary materials:
[ ]
 
Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing.
 
 
1)
 
Amount previously paid:
 
 
 
 
 
 
 
2)
 
Form, Schedule or Registration Statement No.:
 
 
 
 
 
 
 
3)
 
Filing Party:
 
 
 
 
 
 
 
4)
 
Date Filed:
 
 
 
 
 





VISHAY PRECISION GROUP, INC.
3 GREAT VALLEY PARKWAY
SUITE 150

MALVERN, PENNSYLVANIA 19355
 
April 5, 2019
 
Dear Stockholder:
 
You are cordially invited to attend the 2019 Annual Meeting of Stockholders of Vishay Precision Group, Inc., to be held at 9:00 a.m., local time, on Thursday, May 16, 2019, at The Desmond Hotel Malvern, 1 Liberty Boulevard, Malvern, PA 19355. The Board of Directors looks forward to greeting you personally at the annual meeting.
 
During the annual meeting, we will discuss each item of business described in the attached Notice of Annual Meeting of Stockholders and proxy statement and provide a report on Vishay Precision Group’s business operations. There will also be time for questions.
 
On behalf of the Board of Directors, I would like to express our appreciation for your continued interest in the affairs of Vishay Precision Group. We hope you will be able to attend the annual meeting. Whether or not you expect to attend the annual meeting, and regardless of the number of shares you own, it is important to us and to our business that your shares are represented and voted at the annual meeting. Therefore, you are encouraged to vote over the Internet, as well as by telephone, or, if you requested to receive printed proxy materials, by mailing a proxy or voting instruction card, so that your shares will be represented and voted at the 2019 Annual Meeting. Please review the instructions on each of your voting options described in this proxy statement, as well as in the Notice of Internet Availability of Proxy Materials you received in the mail.
 
Sincerely,


/s/ Marc Zandman
Marc Zandman
Chairman of the Board of Directors
 






VISHAY PRECISION GROUP, INC.
3 GREAT VALLEY PARKWAY
SUITE 150

MALVERN, PENNSYLVANIA 19355
 
NOTICE OF 2019 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON THURSDAY,
MAY 16, 2019
 
The 2019 Annual Meeting of Stockholders of Vishay Precision Group, Inc. will be held at The Desmond Hotel Malvern, 1 Liberty Boulevard, Malvern, PA 19355, on Thursday, May 16, 2019 at 9:00 a.m., local time. The meeting will be held to consider and act upon:
 
 
1.
 
The election of seven directors to hold office until the annual meeting of stockholders in 2020;
 
 
 
2.
 
The advisory vote on executive compensation of named executive officers; and
 
 
 
 
 
3.
 
Such other business as may be brought properly before the meeting.
 
Our stockholders of record at the close of business on March 26, 2019 will be entitled to vote at the annual meeting or at any adjournment thereof. Whether or not you expect to attend the meeting in person, we encourage you to read this proxy statement and submit your proxy or voting instructions as soon as possible. For specific instructions on how to vote your shares, please refer to the instructions under the heading “How do I vote my shares? Can I vote electronically?” on page 3 of this proxy statement; the instructions on the Notice of Internet Availability of Proxy Materials you received in the mail; or, if you requested to receive printed proxy materials, your enclosed proxy card.
 
By Order of the Board of Directors,
 

/s/ William M. Clancy
William M. Clancy
Chief Financial Officer and Corporate Secretary
 

Malvern, Pennsylvania
April 5, 2019
 
Important Notice Regarding the Availability of Proxy Materials for the
Annual Meeting of Stockholders to be Held on May 16, 2019.
 
The Proxy Statement for the 2019 Annual Meeting of Stockholders and our 2018 Annual Report to
Stockholders are available for view on the Investor Relations page of our website:
 
http://www.vpgsensors.com
 








TABLE OF CONTENTS
 
SECTION
 
PAGE
About the Meeting
 
1
Governance of the Company
 
5
Director Compensation
 
11
Proposal One – Election of Directors
 
12
Report of the Audit Committee
 
15
Independent Registered Public Accounting Firm
 
16
Security Ownership of Certain Beneficial Owners and Management
 
17
Executive Compensation
 
20
Report of the Compensation Committee
 
28
Compensation Tables
 
29
Proposal Two – Advisory Vote on Executive Compensation
 
38
Certain Relationships and Related Transactions
 
39
Other Matters
 
41
Availability of Annual Report and Form 10-K to Stockholders
 
41
Stockholder Proposals and Nominations for 2020 Annual Meeting
 
41










VISHAY PRECISION GROUP, INC.
3 GREAT VALLEY PARKWAY
SUITE 150
MALVERN, PENNSYLVANIA 19355
________________
PROXY STATEMENT
________________
 
The accompanying proxy is solicited by the Board of Directors of Vishay Precision Group, Inc. for use at the 2019 Annual Meeting of Stockholders to be held at The Desmond Hotel Malvern, 1 Liberty Boulevard, Malvern, PA 19355 on Thursday, May 16, 2019 at 9:00 a.m., local time, or any adjournments thereof.
ABOUT THE MEETING
Why are we holding the 2019 Annual Meeting?
As a matter of good corporate practice, and in compliance with applicable corporate law and the rules of the New York Stock Exchange ("NYSE"), we hold a meeting of stockholders annually. This year’s meeting will be held on May 16, 2019. There will be at least two items of business that must be voted on by our stockholders at the meeting, and our Board of Directors (the “Board”) is seeking your proxy to vote on these items. This proxy statement contains important information about Vishay Precision Group, Inc. and the matters that will be voted on at the meeting. Please read these materials carefully so that you have the information you need to make informed decisions. Throughout this proxy statement, we will refer to ourselves as “Vishay Precision Group, Inc.,” “VPG,” “we,” “our,” or the “Company.”
Why did I receive a notice in the mail regarding the Internet availability of proxy materials instead of a full set of proxy materials?
In accordance with rules adopted by the Securities and Exchange Commission (“SEC”), we may furnish proxy materials, including this proxy statement and our 2018 Annual Report to Stockholders, to our stockholders by providing access to such documents on the Internet instead of mailing printed copies. Most stockholders will not receive printed copies of the proxy materials unless they request them. Instead, the Notice of Internet Availability of Proxy Materials (the “Notice”), which is being mailed to our stockholders on or about April 5, 2019, will instruct you as to how you may access and review all of the proxy materials on the Internet. The Notice also instructs you as to how you may submit your proxy on the Internet. If you would like to receive a paper or email copy of our proxy materials, you should follow the instructions for requesting such materials in the Notice.
What is a proxy?
A proxy is your legal designation of another person to vote the shares of stock that you own. The person you designate to vote your shares is also called a proxy. When you submit a proxy, the people named on the proxy card are required to vote your shares at the annual meeting in the manner you have instructed.
What is the record date and why is it important?
The record date is the date used by our Board to determine which stockholders are entitled to receive notice of, and vote on the items presented at, the annual meeting. Our Board established March 26, 2019 as the record date for the 2019 Annual Meeting.
What is the difference between “Stockholders of Record” and “Beneficial Owners”?
If your shares are registered directly in your name with our transfer agent, you are considered to be the stockholder of record of those shares. The proxy statement, annual report and proxy card have been sent directly to you by the Company.



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If your shares are held in a stock brokerage account or by a bank or other nominee, you are considered the beneficial owner of shares held in “street name.” This proxy statement and the annual report have been forwarded to you by your broker, bank, or nominee, who is considered, with respect to those shares, the stockholder of record. As the beneficial owner, you have the right to direct your broker, bank, or nominee how to vote your shares by using the voting instruction card included in the mailing or by following their instructions for voting.
Who can attend the meeting?
All stockholders as of the record date, or their duly appointed proxies, are invited to attend the meeting.
What proposals will I be voting on and how does the Board of Directors recommend I vote?
The Board’s recommendations are set forth together with the description of each proposal in this proxy statement. In summary, the Board recommends a vote:
FOR the election of seven directors to hold office for terms of one year or until their successors are duly elected and qualified (see Proposal One);
FOR the approval, on an advisory basis, of the compensation for our named executive officers (see Proposal Two); and
for or against any other matters that come before the 2019 Annual Meeting, as the proxy holders deem advisable.
Does VPG have more than one class of stock outstanding?
We have two classes of stock outstanding, common stock and Class B common stock. On the record date, there were 12,486,440 shares of common stock and 1,025,158 shares of Class B common stock outstanding and entitled to vote.
What are the voting rights of each class of stock?
Each share of common stock will be entitled to one vote and each share of Class B common stock will be entitled to 10 votes with respect to each matter to be voted on at the annual meeting.
A list of stockholders entitled to vote at the annual meeting will be available for examination by VPG’s stockholders during ordinary business hours for a period of ten days prior to the annual meeting at our headquarters, 3 Great Valley Parkway, Suite 150, Malvern, Pennsylvania 19355. A stockholder list will also be available for examination at the annual meeting.
What constitutes a quorum?
A quorum is the minimum number of votes required to be present at the annual meeting to conduct business. As set forth in VPG’s by-laws, the holders of a majority of the votes represented by the outstanding shares of common stock and Class B common stock, voting together as a single class, present in person or represented by proxy, will constitute a quorum for the transaction of business at the annual meeting.
What vote is required to approve each proposal?
On each matter to be voted on at the 2019 Annual Meeting, the holders of common stock and Class B common stock will vote together as a single class. Assuming a quorum is present, the vote required and method of calculation for the proposals to be considered at the annual meeting are as follows:
Proposal One. The election of seven directors to hold office for terms of one year, or until their successors are duly elected and qualified, requires a plurality of the votes cast with respect to each directorship.
Proposal Two. The advisory approval of our executive compensation requires the affirmative vote of a majority of the votes cast on Proposal Two.
Other Matters. Aside from the two proposals above, we are not aware of any other matter to be presented at the 2019 Annual Meeting.

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How are abstentions and broker non-votes considered?
Shares represented by proxies that are properly marked “abstain” will be counted for purposes of determining the presence of a quorum at the 2019 Annual Meeting. Abstentions will have no effect on the election of directors under Proposal One or on the vote under Proposal Two.
Brokers holding shares for beneficial owners in street name must vote those shares according to specific instructions they receive from the beneficial owners. If instructions are not received, brokers may only vote the shares, in their discretion, on matters for which they are not precluded from exercising their discretion by the rules of the NYSE. Under the NYSE rules, a broker is permitted to vote shares on routine matters, which do not include the election of directors or the approval, on an advisory basis, of a resolution approving our executive compensation. Accordingly, brokers may not vote in their discretion only on either Proposal One or Proposal Two. For your vote to be counted with respect to any Proposal, you will need to communicate your voting instructions to your bank, broker or other holder of record before the date of the 2019 Annual Meeting.
A broker “non-vote” occurs when a broker holding shares for a beneficial owner does not vote on a particular proposal because the broker does not have discretionary voting power with respect to that item and has not received instructions from the beneficial owner. Broker non-votes will be counted in determining whether there is a quorum at the annual meeting but will not be regarded as votes cast. Because the Company has a plurality voting standard for the election of directors and because the other proposals on the agenda will be determined by a majority of the votes cast, broker non-votes will have no effect on the outcome of the vote on any of the proposals.
How do I vote my shares? Can I vote electronically?
If you are a holder of record of our common stock as of the record date, there are four ways to vote:
On the Internet. You can vote over the Internet at www.proxyvote.com, 24 hours a day, seven days a week, by following the instructions on your proxy card. You will need the 12-digit control number included on your proxy card.
Over the Phone. You can vote using a touch-tone telephone by calling 1-800-690-6903, 24 hours a day, seven days a week, and following the instructions on your proxy card.
By Mail. If you requested a copy of our proxy materials by mail, you may complete, sign and mail your enclosed proxy card to Vote Processing, c/o Broadridge Financial Solutions, 51 Mercedes Way, Edgewood, NY 11717.
In Person. You may vote by written ballot at the annual meeting.
The shares represented by your proxy, whether voted using the Internet, by phone, or mail, will be voted as directed with respect to each of the proposals set forth in the proxy statement, OR, if no direction is indicated by your proxy for a proposal, in accordance with the recommendation of the Board.
You may either vote “for all” or “withhold” your vote for the election of the director nominees under Proposal One, or you may vote for only some of the nominees. You may vote “for,” “against,” or “abstain” on Proposal Two.
Whether or not you plan to attend the meeting, we strongly encourage you to vote by proxy prior to the meeting.
Can I change my vote after I return my proxy card?
Yes. You may revoke your proxy at any time before it is voted at the 2019 Annual Meeting. In order to revoke your proxy, you may either:
sign, and timely return, another proxy card bearing a later date;
provide written notice of the revocation to VPG’s Corporate Secretary; or
attend the annual meeting and vote in person.
If your shares are held in a stock brokerage account or by a bank or other nominee, you must follow the instructions provided by your broker, bank, or nominee on how to revoke your proxy.


3




What will happen if I provide my proxy but do not vote on one or more proposals?
If you are the record holder of your shares, you should provide voting instructions for all proposals appearing on the proxy card. The persons named as proxies on the enclosed proxy card will vote your shares according to your instructions. However, if you fail to provide instructions on how you want your shares to be voted, properly signed and dated proxies will be voted in accordance with the recommendation of the Board.
If you hold your shares in “street name,” you should provide voting instructions for all proposals appearing on the proxy card to your broker, bank, or other holder of record. If you do not provide voting instructions for all proposals, your broker, bank, or other holder of record might not be authorized to vote your shares on certain matters, in which event they will be recorded as “broker non-votes.” See the discussion under the heading “How are abstentions and broker non-votes considered?” above.
 
What will happen if I do not provide my proxy?
If you are a stockholder of record, your shares will not be voted unless you attend the 2019 Annual Meeting and vote your shares in person.
If you are the beneficial owner of shares held in street name, your broker, bank, or other holder of record might not be authorized to vote your shares on certain matters and they will be recorded as “broker non-votes.” See the discussion under the heading “How are abstentions and broker non-votes considered?” above.

Who paid to send me the proxy materials?
The cost of production and mailing of proxy materials, and the solicitation of proxies, is borne by VPG. The Board may use the services of VPG’s directors, officers and other regular employees to solicit proxies personally or by telephone. Arrangements will be made with brokerage houses and other custodians, nominees and fiduciaries to forward solicitation material to the beneficial owners of the shares held of record by such fiduciaries, and VPG will reimburse them for the reasonable expenses incurred by them in so doing.

Who is assuming the expense of the proxy solicitation?

VPG engaged The Proxy Advisory Group, L.L.C. to assist with the solicitation of proxies and provide related advice and informational support for a services fee and reimbursement of customary disbursements, the total of which is not expected to exceed $15,000.

Are there any stockholders who own more than 5% of VPG’s shares or voting power?
According to filings made with the SEC, Nokomis Capital, L.L.C. ("Nokomis"), Dimensional Fund Advisors LP, Renaissance Technology LLC and BlackRock, Inc. each own greater than 5% of VPG’s outstanding common stock.
Ruta Zandman, Ziv Shoshani and Marc Zandman are co-trustees of a family trust which holds 3,010 shares of common stock and 615,487 shares of Class B common stock, representing less than 1% of our common stock and approximately 60% of our class B common stock, respectively, and, together, 27.1% of the aggregate voting power of the outstanding capital stock of the Company. Therefore, Ruta Zandman controls, solely or on a shared basis with Marc Zandman and Ziv Shoshani, approximately 34.6% of the total voting power of our capital stock; Marc Zandman controls, solely or on a shared basis with Ruta Zandman and Ziv Shoshani, approximately 27.1% of the total voting power of our capital stock; and Ziv Shoshani controls, solely or on a shared basis with Ruta Zandman and Marc Zandman, approximately 27.7% of the total voting power of our capital stock. All three intend to vote FOR ALL nominees, and FOR Proposal Two. Pursuant to the family trust, each of them is required to cause shares controlled by the trust to be voted in support of the election of Messrs. Shoshani and Zandman as directors of the Company.
See “Security Ownership of Certain Beneficial Owners and Management” for more information. Except as described above, none of these 5% or greater stockholders have indicated their intentions to VPG regarding matters to be voted on at the annual meeting.

4




GOVERNANCE OF THE COMPANY
 
How is VPG governed?
At VPG, day-to-day business activities are carried out by our employees under the direction and supervision of Ziv Shoshani, our Chief Executive Officer (“CEO”). The Board oversees these activities. In doing so, each director is required to apply his or her business judgment in the best interests of VPG and its stockholders. The Board’s primary responsibilities include:
Review of our performance, strategies, and major decisions;
Oversight of our compliance with legal and regulatory requirements and the integrity of our financial statements;
Oversight of management, including review of the CEO’s performance and succession planning for key management roles; and
Oversight of compensation for the CEO, key executives and the Board, as well as oversight of compensation policies and programs for all employees.
Additional description of the Board’s responsibilities is included in our Corporate Governance Principles document, which is available to stockholders on our website and in print upon request, as described in this proxy statement.
Where can I find more information about the corporate governance practices of VPG?
Various corporate governance related documents are available on our website, including:
Corporate Governance Principles
Code of Business Conduct and Ethics
Code of Ethics Applicable to the Chief Executive Officer, Chief Financial Officer, and Principal Accounting Officer or Controller
Audit Committee Charter
Nominating and Corporate Governance Committee Charter
Compensation Committee Charter
To view these documents, access our Investor Relations page at http://ir.vpgsensors.com and click on “Corporate Governance.” Any of these documents can be obtained in print by any stockholder upon written request to VPG’s investor relations department.
We intend to post any amendments to, or any waivers from, a provision of our Code of Ethics Applicable to the Chief Executive Officer, Chief Financial Officer, and Principal Accounting Officer or Controller on our website.
What is the composition of our Board of Directors?
VPG has a single class of directors, all of whom are elected annually. The number of directors is fixed by the Board, subject to a maximum of nine directors as provided in the Company’s charter documents. There are currently seven members of the Board. As described in Proposal One, all of our directors are nominated to serve for a term expiring at the annual meeting of stockholders in 2020.
Biographical information on each of the directors is included in Proposal One.
How does the Board determine which directors are considered independent?
The Board has determined that, to be considered independent, an outside director may not have a direct or indirect material relationship with VPG. A material relationship is one which impairs or inhibits, or has the potential to impair or inhibit, a director’s exercise of critical and disinterested judgment on behalf of VPG and its stockholders. The materiality standard applied by the Board includes, but is not limited to, the disqualifying relationships set forth in the governance listing standards of the NYSE.
Accordingly, the Board has concluded that Janet Clarke, Wesley Cummins, Bruce Lerner, Saul Reibstein and Timothy Talbert qualify as independent directors. The Audit Committee, the Nominating and Corporate Governance Committee, and the Compensation Committee of the Board are composed entirely of independent directors.


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How often did the Board meet during 2018?
The Board met six times during 2018. In 2018, each director attended at least 75% of the aggregate number of meetings of the Board of Directors and any Committee on which such director served during their period of Board service. All of our current directors attended the 2018 annual meeting of stockholders. It is the policy of the Board that directors are expected to attend the 2019 Annual Meeting and all future annual meetings of stockholders.
What is the role of the Board’s Committees?
Nominating and Corporate Governance Committee - The functions of the Nominating and Corporate Governance Committee include identifying individuals qualified to become members of the Board; selecting, and recommending that the Board approve the director nominees for the next annual meeting of stockholders; developing and recommending to the Board a set of corporate governance principles for VPG; overseeing the evaluation of the Board and the management of VPG; administering VPG’s Related Party Transactions Policy; and performing other related functions specified in the Committee’s charter. A copy of the Committee’s charter is available to stockholders on our website and in print upon request.
The chair of the Nominating and Corporate Governance Committee is designated under our Corporate Governance Principles to preside at the executive sessions of the Board’s non-management directors. The current chair of the Nominating and Corporate Governance Committee is Mr. Talbert.
Audit Committee - The functions of the Audit Committee include overseeing VPG’s accounting and financial reporting processes; overseeing the audits of our consolidated financial statements and the effectiveness of our internal control over financial reporting; assisting the Board in its oversight of the integrity of our financial statements, our compliance with legal and regulatory requirements, the independence and qualifications of our independent registered public accounting firm, and the performance of our internal audit function and independent registered public accounting firm; and performing other related functions specified in the Committee’s charter. The Audit Committee consists of three non-management directors, each of whom satisfies the independence requirements of the rules of the SEC and the governance listing requirements of the NYSE. All of the members of the Committee also satisfy the financial literacy requirements of the NYSE and the Board has determined that Mr. Reibstein, the chair of the Committee, qualifies as an audit committee financial expert under the rules of the SEC. A copy of the Committee’s charter is available to stockholders on our website and in print upon request.
Compensation Committee - The functions of the Compensation Committee include evaluating the performance of the Company’s executive officers and, based on this evaluation, determining and approving the compensation of the executive officers; making recommendations to the Board with respect to, and administering, our incentive compensation plans and equity based compensation plans; and performing other related functions specified in the Committee’s charter. The Compensation Committee is authorized, within the limits of the Company’s Amended and Restated 2010 Stock Incentive Program, as amended (the “2010 Stock Incentive Program”), to determine the individuals who are to receive awards; the type of awards, including stock, stock options, restricted stock and restricted stock units (“RSUs”), and the vesting requirements with respect to those awards, and to administer and interpret the 2010 Stock Incentive Program. Ms. Clarke is the chair of this Committee. A copy of the Committee’s charter is available to stockholders on our website and in print upon request.
Board Leadership Structure and Role in Risk Oversight
The Board believes that it is important to retain the flexibility to combine or separate the responsibilities of the offices of Chairman of the Board and CEO, as may be in the best interests of the Company from time to time.
The significant experience of Mr. Marc Zandman, our Chairman, with the Company’s business (as a subsidiary of Vishay Intertechnology, Inc. (“Vishay Intertechnology”) prior to the spin-off) uniquely qualifies him to serve as the Board’s non-executive Chairman. At the same time, the active membership of our CEO, Mr. Ziv Shoshani, assures our Board of the benefit of his comprehensive knowledge of the Company’s business, day-to-day operations, industry and competitive challenges.

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Management continually monitors the material risks facing the Company, including financial risk, strategic risk, operational risk, corporate governance risk, and legal and compliance risk. The Board is responsible for exercising oversight of management’s identification and management of, and planning for, those risks. Although the Board is ultimately responsible for risk oversight at the Company, the Board has delegated to certain Committees oversight responsibility for those risks that are directly related to their respective areas of focus.
The Audit Committee reviews our policies and guidelines with respect to risk assessment and risk management, including our major financial risk exposures, and oversees the steps management has taken to monitor and control those exposures.

The Compensation Committee considers risk issues when establishing and administering our compensation programs for executive officers and other key personnel.

The Nominating and Corporate Governance Committee oversees corporate governance risks, including matters relating to the composition and organization of the Board and recommends to the Board how its effectiveness can be improved by changes in its composition and organization.
Each of these Committees routinely reports to the Board on the management of these specific risk areas. To permit the Board and its Committees to perform their respective risk oversight roles, individual members of management who supervise the Company’s risk management report directly to the Board or the relevant committee of the Board responsible for overseeing the management of specific risks, as applicable. For this purpose, management has a high degree of access and communication with the Board and its Committees.
The Board believes that open and constructive communication between management and the Board is essential for effective risk management and oversight. Members of the Company’s senior management regularly attend Board and committee meetings and are available to address any questions or concerns raised on matters related to risk management. The Board and its Committees exercise their risk oversight function by carefully evaluating the reports they receive from management and by making inquiries of management with respect to areas of particular interest to the Board.

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The following table summarizes the composition of these Committees during 2018:
 
 
 
 
Nominating &
 
 
 
 
 
 
Corporate
 
 
 
 
 
 
Governance
 
Compensation
 
 
Audit Committee
 
Committee
 
Committee
Marc Zandman
 
 
 
Janet Clarke
 
*
 
 
**
Wesley Cummins
 
 
 
Bruce Lerner
 
 
*
 
Saul Reibstein
 
**
 
*
 
*
Ziv Shoshani
 
 
 
Timothy Talbert
 
*
 
**
 
*

 

 

 

 
 
 
 
 
 
 
No. of meetings during 2018
 
9
 
3
 
6
____________________
*
 
– Member
 
 
 
**
 
– Chair
How does the Board select nominees for the Board?
In selecting candidates for nomination at the annual meeting of our stockholders, the Nominating and Corporate Governance Committee begins by determining whether the incumbent directors whose terms expire at the meeting desire, and are qualified, to continue their service on the Board. We are of the view that the repeated service of qualified incumbents promotes stability and continuity in the boardroom, giving us the benefit of the familiarity and insight into our affairs that our directors have accumulated during their tenure and contributing to the Board’s ability to work as a collective body. Accordingly, it is the policy of the Nominating and Corporate Governance Committee, absent special circumstances, to nominate qualified incumbent directors who continue to satisfy the Committee’s criteria for membership on the Board; who the Committee believes will continue to make important contributions to the Board; and who consent to stand for re-election and, if re-elected, to continue their service on the Board. If there are Board positions for which the Committee will not be re-nominating a qualified incumbent, the Committee will solicit recommendations for nominees from persons who the Committee believes are likely to be familiar with qualified candidates, including members of the Board and senior management.
The Nominating and Corporate Governance Committee may also engage a search firm to assist in identifying qualified candidates. If such a search firm is engaged, the Committee sets the fees and scope of engagement. The Nominating and Corporate Governance Committee will review and evaluate each candidate who it believes merits serious consideration, taking into account all available information concerning the candidate, the qualifications for Board membership established by the Committee, the existing composition and mix of talent and expertise on the Board and other factors that it deems relevant. In conducting its review and evaluation, the Nominating and Corporate Governance Committee may solicit the views of management and other members of the Board and may, if deemed helpful, conduct interviews of proposed candidates. The Nominating and Corporate Governance Committee will evaluate candidates recommended by stockholders in the same manner as candidates recommended by other persons, except that the Committee may consider, as one of the factors in its evaluation of stockholder-recommended candidates, the size and duration of the interest of the recommending stockholder or stockholder group in the equity of VPG and whether the stockholders intend to continue holding that interest through the annual meeting date.


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What qualifications must a director have?
Under a policy formulated by our Nominating and Corporate Governance Committee, we generally require that all candidates for director:
be persons of integrity and sound ethical character;
be able to represent all stockholders fairly;
have no interests that materially conflict with those of VPG and its stockholders;
have demonstrated professional achievement;
have meaningful management, advisory or policy making experience;
have a general appreciation of the major business issues facing VPG; and
have adequate time to devote to serve on the Board.
A limited exception to some of these requirements, other than the requirements of integrity and ethics and the absence of material conflict, may be made for a holder of substantial voting power. Directors may not stand for re-election after the age of 75 unless the Board makes an affirmative determination that, because of the importance and value of the continued service of a director, the retirement policy should be waived, except that no director may stand for re-election after age 85. This policy does not apply to any person who controls more than 20% of the voting power of the Company. We also require that a majority of directors be independent; at least three of the directors have the financial literacy necessary for service on the audit committee and at least one of these directors qualifies as an audit committee financial expert; at least some of the independent directors have served as senior executives of public or substantial private companies; and at least some of the independent directors have general familiarity with the major industries in which we operate. Additionally, while the Company does not have a formal policy with respect to the consideration of diversity in identifying director candidates, the benefits of board diversity are considered in the nominations process, including diversity of background and experience.
Can I recommend a nominee for director?
Yes. The Nominating and Corporate Governance Committee will consider recommendations for director nominations submitted by stockholders entitled to vote generally in the election of directors. Submissions must be made in accordance with the Nominating and Corporate Governance Committee’s procedures, as outlined herein and set forth on our website. For each annual meeting of our stockholders, the Nominating and Corporate Governance Committee will accept for consideration only one recommendation per stockholder or affiliated group of stockholders. The Nominating and Corporate Governance Committee will only consider candidates who satisfy our minimum qualifications for director, as summarized in this proxy statement and as set forth on our website. Stockholders should be aware, as discussed herein, that it is our general policy to re-nominate qualified incumbent directors and that, absent special circumstances, the Committee will not nominate other candidates when a qualified incumbent director consents to stand for re-election.
A stockholder wishing to recommend to the Nominating and Corporate Governance Committee a candidate for election as director must submit the recommendation in writing, addressed to the Committee, care of our Corporate Secretary, at Vishay Precision Group, Inc., 3 Great Valley Parkway, Suite 150, Malvern, PA 19355. Submissions must be made by mail, courier, or personal delivery. E-mailed submissions will not be considered. Submissions recommending candidates for election at an annual meeting of stockholders must generally be received no later than 120 calendar days prior to the first anniversary of the date of the proxy statement for the prior annual meeting of stockholders. However, in the event that the date of an annual meeting of stockholders is more than 30 days following the first anniversary date of the annual meeting of stockholders for the prior year, the submission must be made a reasonable time in advance of the mailing of our proxy statement for the current year. Each nominating recommendation must be accompanied by the information called for by our “Procedures for Securityholders’ Submission of Nominating Recommendations,” which is available upon request. This includes specified information concerning the stockholder or group of stockholders making the recommendation and the proposed nominee, any relationships between the recommending stockholder or stockholders and the proposed nominee and the qualifications of the proposed nominee to serve as director. The recommendation must also be accompanied by the consent of the proposed nominee to serve if nominated and elected and the agreement of the nominee to be contacted by the Committee, if the Committee decides in its discretion to do so.


9




In addition to being entitled to make a recommendation that the Committee nominate a candidate for election as a director, stockholders are also entitled to nominate candidates themselves for election to the Board at a meeting of stockholders, by providing the necessary information by the applicable deadlines. See the discussion under the heading “Stockholder Proposals and Nominations for the 2020 Annual Meeting” below.
How do stockholders and others communicate with the Board?
VPG stockholders may communicate with the Board, any Committee of the Board or any individual director, and any interested party may communicate with the non-management directors of the Board as a group, by delivering such communications either in writing addressed to our Corporate Secretary at Vishay Precision Group, Inc., 3 Great Valley Parkway, Suite 150, Malvern, PA 19355; or by e-mail to [email protected]ors.com. Communications should not exceed 1,000 words.
All communications must be accompanied by the following information: (i) if the person submitting the communication is a securityholder, a statement of the type and amount of the securities of VPG that the person holds; (ii) if the person submitting the communication is not a securityholder and is submitting the communication to the non-management directors as an interested party, the nature of the person’s interest in VPG; (iii) any special interest, meaning an interest not in the capacity as a stockholder of VPG, of the person in the subject matter of the communication; and (iv) the address, telephone number and e-mail address, if any, of the person submitting the communication. Communications addressed to directors may, at the direction of the directors, be shared with VPG’s management.


10




DIRECTOR COMPENSATION
During 2017, the Compensation Committee engaged Meridian Compensation Partners, LLC (“Meridian”) to advise the Compensation Committee on compensation matters, including compensation for non-employee directors. Based on input from Meridian, and at the recommendation of the Compensation Committee, the Board adopted amendments to the 2014 Non-Employee Director Compensation Plan, (as amended the “NEDC Plan”), effective as of the date of the 2017 Annual Meeting. Under the NEDC Plan, concurrent with the 2018 annual meeting, each non-employee director became entitled to receive an annual retainer fee of $35,000 for serving on the Board, excluding the Chairman, who receives an annual retainer fee of $75,000 for his service. In addition, under the NEDC Plan, the chair of the Audit Committee became entitled to receive an annual retainer of $15,000, and the chairs of the Compensation Committee and the Nominating and Governance Committee each became entitled to receive an annual retainer of $10,000 for their services as chair of their respective committees. Under the NEDC Plan, the retainer fees for the independent directors are paid in equal quarterly installments in advance and beginning with a payment due on the date of the annual meeting. Such annual retainer fees are pro-rated for a partial year of service by a non-employee director elected to the board between annual meetings.
Under the NEDC Plan, each of our non-employee directors was granted RSUs worth $55,000 effective immediately upon their election at the 2018 annual meeting. The number of RSUs granted is based on the average closing price of our common stock on the New York Stock Exchange for the five consecutive trading days immediately preceding the date of grant. These grants will vest on the date of the 2019 annual meeting but no later than May 17, 2019 (the first anniversary of their grant date), subject to each non-employee director's continued service on the board. The grant-date fair value of RSUs is recognized over the vesting period. For directors appointed between annual meetings, the amount of the stock grant is pro-rated for a partial year of service by the non-employee director and vests on the date of the first annual meeting after the date of grant subject to the director’s continued service on the board.
Our director who is also an employee of VPG (our Chief Executive Officer) did not receive any additional compensation for his service as a director. See the discussion herein under the heading “Executive Compensation.”
The following table provides information with respect to the compensation paid or provided to the Company’s non-management directors during 2018:
 
 
 
 
Stock
 
 
 
 
 
 
Awards
 
 
Name
 
Fees Paid
 
(1)
 
Total
Janet Clarke
 
$
45,000

 
$
55,764

 
$
100,764

Wesley Cummins
 
$
35,000

 
$
55,764

 
$
90,764

Bruce Lerner
 
$
35,000

 
$
55,764

 
$
90,764

Saul Reibstein
 
$
50,000

 
$
55,764

 
$
105,764

Timothy Talbert
 
$
45,000

 
$
55,764

 
$
100,764

Marc Zandman (2)
 
$
75,000

 
$
55,764

 
$
130,764

 
 
 
 
 
 
 
____________________
(1)
 
The amounts presented in the table represent the aggregate grant-date fair value of the RSUs computed in accordance with FASB ASC Topic 718 and the assumptions as set forth in Note 10 of our consolidated financial statements in our Annual Report on Form 10-K filed with the SEC on March 14, 2019.
 
 
 
(2)
 
Non-Executive Chairman of the Board.

11







PROPOSAL ONE
ELECTION OF DIRECTORS
Seven directors serving on the Board are nominated for re-election, with a term expiring at the annual meeting of stockholders in 2020. Each of the nominees has consented to serve if elected.
If any nominee for director becomes unavailable for election, the proxies will be voted for such substitute nominee(s) as the Board may propose. We have no reason to believe that any of the nominees will be unable or unwilling to serve if elected.
The following table summarizes the current directors:
Name
 
Age
 
Director Since
Janet Clarke
 
66
 
2016
Wesley Cummins
 
41
 
2017
Bruce Lerner
 
53
 
2017
Saul Reibstein
 
70
 
2010
Ziv Shoshani
 
52
 
2009
Timothy Talbert
 
72
 
2010
Marc Zandman (1)
 
57
 
2010
____________________
(1)
 
Non-Executive Chairman of the Board.
Nominees for Election as Directors – Terms Expiring 2020
Marc Zandman is the non-executive Chairman of our Board. Mr. Zandman was elected Executive Chairman of the board of directors of Vishay Intertechnology in 2011 after serving as Vice Chairman for Vishay Intertechnology since 2003; a director of Vishay Intertechnology since 2001; and President of Vishay Israel Ltd. since 1998. In addition to these positions, Mr. Zandman was appointed Chief Business Development Officer of Vishay Intertechnology as of June 2011 and Chief Administration Officer of Vishay Intertechnology as of January 1, 2007; has served as Group Vice President of Vishay Intertechnology Measurements Group from 2002 to 2004; and served in various other capacities with Vishay Intertechnology since 1984.  He is the son of the late Dr. Felix Zandman, the founder and former Executive Chairman of Vishay Intertechnology.  Mr. Marc Zandman’s dedicated service to Vishay Intertechnology and extensive knowledge of our business give him valuable experience facing issues relevant to our Company.
Ziv Shoshani is our Chief Executive Officer and President, and has been since our spin-off as an independent public company in July, 2010. He also serves on the Board. Mr. Shoshani was Chief Operating Officer of Vishay Intertechnology from January 1, 2007 to November 1, 2009. During 2006, he was Deputy Chief Operating Officer of Vishay Intertechnology. Mr. Shoshani was Executive Vice President of Vishay Intertechnology from 2000 to 2009 with various areas of responsibility, including Executive Vice President of the Capacitors and the Resistors businesses, as well as heading the Measurements Group and Foil Divisions. Mr. Shoshani had been employed by Vishay Intertechnology since 1995. He continues to serve on the Vishay Intertechnology board of directors. Mr. Shoshani is a nephew of the late Dr. Felix Zandman, the founder of Vishay Intertechnology. Mr. Shoshani’s long-standing dedication to our Company, exemplified by his extensive management experience and experience on the Vishay Intertechnology board of directors, provides him with valuable insight into the business and the operation of our Company and makes him a valuable advisor to the Board.



12







Janet M. Clarke. Ms. Clarke is the founder of Clarke Littlefield LLC, a marketing technologies advisory firm, and has served as its President since June 2003. Prior to founding Clarke Littlefield, she served in executive and management roles at DealerTrack, Inc., a privately held automotive finance technology services company; KnowledgeBase Marketing, a subsidiary of Young and Rubicam, Inc.; and Citibank for Citigroup’s consumer business. Ms. Clarke has served as a director for Cox Enterprises, Inc., a private company, since 2007, where she also serves as Chair of the Compensation Committee and as a member of the Audit Committee. Ms. Clarke served as a director for Asbury Automotive Group, Inc. (NYSE: ABG) from April 2005 until April 2015, where she also served as a member of the Audit Committee from April 2005 to January 2009 and from October 2012 to May 2014; as a member of the Human Resources and Compensation Committee from April 2005, and was appointed Chair of the Committee in August 2006, to April 2015; and as a member of the Governance Committee from November 2006 to April 2015. Ms. Clarke was also a director and a member of the Audit Committee and the Chair of the Compensation Committee of ExpressJet Holdings, Inc. (NYSE: XJT) from 2001-2011. Ms. Clarke earned a Bachelor Degree in Architecture from Princeton University and has completed the Advanced Management Program at the Harvard Business School. Ms. Clarke offers significant business experience to our Board, particularly in the areas of marketing and marketing technology, as a result of the various executive and management positions she has held in corporations of various sizes. In addition, given the public and private company directorships that she has held during her career, Ms. Clarke has a broad range of experience as a director and a deep understanding of board oversight and the exercise of appropriate diligence, which makes her a valuable addition to the VPG Board.

Wesley Cummins. Mr. Cummins has been an analyst with Nokomis Capital, L.L.C., an investment advisory firm which currently owns approximately 15.6% of VPG’s outstanding common stock, since October 2012. Mr. Cummins also currently serves as a director of Telenav, Inc. (NASDAQ: TNAV), a leading provider of location-based platform services, since August 2016. He was also appointed a director of Sequans Communications S.A. (NYSE: SQNS), a leading provider of single-mode 4G LTE semiconductor solutions for the Internet of Things (IoT) and a wide range of broadband data devices in July 1018. From March 2011 to September 2012, Mr. Cummins was an analyst for Harvey Partners. Prior to that, Mr. Cummins was employed at B. Riley & Co. (NASDAQ: RILY), an investment banking firm, from February 2002 to 2011 where he served in increasing positions of responsibility, including as Capital Markets Director and, ultimately, as President of B. Riley & Co. Mr. Cummins holds a Bachelor of Science degree in Business Administration from Washington University in St. Louis. Mr. Cummins' experience in investment banking and capital markets lends a valuable perspective to the VPG Board.

Dr. Bruce Lerner. Dr. Lerner serves as President and Chief Executive Officer of PeroxyChem, LLC, a private equity-backed, global specialty chemicals company, a position he has held since 2014. From 2007 to 2014, he served as vice president and global business director with FMC Peroxygens. Dr. Lerner began his career in 1993 as a staff chemist at Engelhard Corporation and continued, through acquisition, at BASF Corporation. Since 2007, Dr. Lerner has also served as a board member and director for Thai Peroxide Ltd., a joint-venture chemicals company based in Thailand serving Asia. Dr. Lerner earned his Bachelor of Science degree from the University of Massachusetts at Amherst and his Master of Science degree in Industrial Chemistry from the University of Central Florida. He earned his Ph.D. in Inorganic Chemistry from Northwestern University in 1993. Dr. Lerner is the author of more than 25 peer-reviewed publications. Dr. Lerner's operating experience as a president and CEO of a global company combined with his technology expertice allows him to provide significant contribution to the VPG Board.
Saul V. Reibstein. Mr. Reibstein served as Executive Vice President, Chief Financial Officer and Treasurer of Penn National Gaming, Inc. (NASDAQ: PENN) until December 31, 2016, where he also served on the board of directors and as chairman of the audit committee from June 2011 until his appointment as Senior Vice President and Chief Financial Officer in November 2013.  Mr. Reibstein was employed as an executive advisor by Penn National Gaming during the first part of 2017, after which he retired. Effective March 21, 2018, Mr. Reibstein was again appointed to the board of directors of Penn National Gaming. From 2004 until joining Penn National Gaming as an executive, Mr. Reibstein served as a member of the senior management team of CBIZ, Inc., a New York Stock Exchange-listed professional services company, where, as Executive Managing Director, he was responsible for the management of the CBIZ New York City Financial Services office operations and the overall international activities of the Financial

13




Services /Group. Mr. Reibstein is the majority owner of S3 Living, formally named NCP Ventures, LLC, an independent advisory service for senior citizens, helping them to identify, select and negotiate the transition to Continuing Care Retirement Communities and 55 and Over Communities. Mr. Reibstein has over 40 years of public accounting experience, including 11 years serving as a partner in BDO Seidman, a national accounting services firm, where he was the partner in charge of the Philadelphia office from June 1997 to December 2001 and Regional Business Line Leader from December 2001 until September 2004. Mr. Reibstein is a licensed CPA in Pennsylvania and received a Bachelor of Business Administration from Temple University. Mr. Reibstein qualifies as an audit committee financial expert satisfying the rules of the SEC. Mr. Reibstein’s qualification as an audit committee financial expert, as well as his extensive experience as a public accounting partner, make him highly qualified to serve both as a director of our company and a financial expert on the Audit Committee. Mr. Reibstein also has relevant, long-standing experience as a manager of an NYSE-listed company that he will draw upon in advising us with respect to our listing and filing compliance.
Timothy V. Talbert. Mr. Talbert has served as Senior Vice President of Credit and Originations for Lease Corporation of America (“LCA”), a national equipment lessor, from July 2000 to the end of 2018, and President of the LCA Bank Corporation, a bank that augments LCA’s funding capacity, from its founding in January 2006 to the end of 2018. He recently retired from both of these positions. Previously, Mr. Talbert was Senior Vice President and Director of Asset Based Lending and Equipment Leasing of Huntington National Bank from 1997 to 2000; and prior to that, served in a variety of positions with Comerica Bank for more than 25 years. Mr. Talbert also serves as a director of Vishay Intertechnology. Mr. Talbert previously served on the board of directors and was a member of the audit committee of Siliconix Incorporated, a NASDAQ-listed manufacturer of power semiconductors of which Vishay Intertechnology owned an 80.4% interest, from 2001 until Vishay Intertechnology acquired the noncontrolling interests in 2005. Mr. Talbert received a Bachelor’s Degree in Economics from University of the Pacific and an MBA from the University of Notre Dame. Mr. Talbert’s previous service as a director and member of the audit and compensation committees of a publicly traded company, as well as his current service on the board of another publicly traded company, allows him to bring an important perspective to the Board. Additionally, Mr. Talbert’s prior service as the president of a federally regulated institution gives him relevant understanding of compliance with complex regulations and current accounting rules adding invaluable expertise to our Board.

The Board of Directors recommends a vote “FOR ALL” the nominees for election as directors.




14




REPORT OF THE AUDIT COMMITTEE
 
Management is responsible for maintaining effective internal control over financial reporting, for assessing the effectiveness of internal control over financial reporting, and for preparing our consolidated financial statements. Our independent registered public accounting firm is responsible for, among other things, performing an independent audit of our consolidated financial statements in accordance with standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”) and issuing a report thereon. It is the responsibility of the Audit Committee to monitor and oversee these processes.
In fulfilling its oversight duties, the Audit Committee reviewed and discussed with management and our independent registered public accounting firm for the fiscal year ended December 31, 2018, Ernst & Young LLP, (a) the audited financial statements for the fiscal year ended December 31, 2018, (b) the effectiveness of our internal control over financial reporting, and (c) the other matters required to be discussed under Statement on Auditing Standards No. 61, Communications with Audit Committees, as amended and as adopted by the PCAOB in Rule 3200T. These required communications addressed, among other topics, the independent registered public accounting firm’s responsibility under the standards of the PCAOB; critical accounting policies and practices; judgments and accounting estimates; alternative accounting treatments; any significant audit adjustments; any disagreements or difficulties encountered in performing the audit; and other material communications between the independent registered public accounting firm and management. The Audit Committee received from the independent auditors written disclosures regarding the auditor’s independence required by PCAOB Ethics and Independence Rule 3526, Communication with Audit Committees Concerning Independence, and has discussed with the independent auditors, the independent auditor’s independence. The Audit Committee also considered the compatibility of non-audit services provided to VPG by Ernst & Young LLP, and the fees and costs billed or to be billed for these services, with the maintenance of the independent registered public accounting firm’s independence. The Committee has concluded that the provision of the non-audit services by Ernst & Young LLP in 2018 did not impair the independent registered public accounting firm’s independence. Under the Audit and Non-Audit Services Pre-Approval Policy that was adopted by the Audit Committee in July 2010, the Audit Committee must pre-approve all audit and non-audit services provided to VPG by the independent registered public accounting firm. The policy sets forth the procedures and conditions for pre-approval of these services. All of the audit and non-audit services provided by the independent registered public accounting firm since adoption of the Audit and Non-Audit Services Pre-Approval Policy were pre-approved by the Committee in accordance with such policy.
Based upon this review and discussions with management and the independent registered public accounting firm, the Audit Committee recommended to the Board of Directors that our audited financial statements be included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018 for filing with the Securities and Exchange Commission. The Audit Committee continues to evaluate the appointment of an independent registered accounting firm to audit our financial statements for the fiscal year ending December 31, 2019, as well as to audit the effectiveness of our internal control over financial reporting.

Respectfully submitted,
 
The Audit Committee of the Board of Directors
 
Saul Reibstein, Chair
Janet Clarke
Timothy Talbert
 
Notwithstanding anything to the contrary set forth in any of our previous or future filings under the Securities Act or the Exchange Act that might incorporate this proxy statement in such filings with the SEC, in whole or in part, the above report shall not be deemed to be “soliciting material” or “filed” with the SEC and shall not be deemed to be incorporated by reference into any such filing.


15




INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Audit Committee of the Board is responsible for the selection of our independent registered public accounting firm. The Audit Committee continues to evaluate the appointment of an independent registered public accounting firm to audit our financial statements for the fiscal year ending December 31, 2019, as well as to audit the effectiveness of our internal control over financial reporting. Accordingly, we are not proposing to our stockholders that they ratify the appointment of an independent registered public accounting firm at the Annual Meeting of Stockholders.
Ernst & Young LLP has served as our independent registered public accounting firm since 2009. Representatives of the firm of Ernst & Young LLP are expected to be present at the 2019 Annual Meeting and will have an opportunity to make a statement if they so desire and will be available to respond to appropriate questions from stockholders.
Under the Audit and Non-Audit Services Pre-Approval Policy that was adopted by the Audit Committee in July 2010, the Audit Committee must pre-approve all audit and non-audit services provided to VPG by the independent registered public accounting firm. The policy sets forth the procedures and conditions for pre-approval of these services. The Audit Committee has pre-approved generally the engagement of the independent registered public accounting firm for services relating to our filings with the SEC (including comfort letters, comment letters and consents for securities offerings); acquisition or disposition related diligence activities; internal control review and compliance; interpretation and compliance with accounting and accounting-related disclosure rules and standards; certain attest services; domestic and international tax planning and compliance; and risk management.
The following table sets forth the aggregate fees billed by Ernst & Young LLP for audit and non-audit services rendered to VPG in 2018 and 2017. These fees are categorized as audit fees, audit-related fees, tax fees, and all other fees. The nature of the services provided in each category is described following the table.
 
2018
 
2017
Audit fees
$
1,988,000

 
$
1,982,000

Audit-related fees
-

 
-

Tax fees
41,000

 
18,000

All other fees
-

 
19,000

Total fees
$
2,029,000

 
$
2,019,000

____________________
 
 
 
Audit fees. These fees generally consist of professional services rendered for the audits of the consolidated financial statements of VPG, quarterly reviews, statutory audits, issuance of consents, and assistance with and review of documents filed with the SEC.
Audit-related fees. These fees generally consist of assurance and other services related to the performance of the audit or review of VPG’s financial statements or that are traditionally performed by the independent registered public accounting firm, and consultations concerning financial accounting and reporting standards.
Tax fees. These fees relate primarily to tax compliance, including review of corporate tax returns, assistance with tax audits, review of the tax treatment for certain expenses, and tax-related due diligence. They also include fees for state and local tax planning and consultations with respect to various domestic and international tax matters.
All other fees. These fees generally consist of reviews for compliance with various government regulations, risk management and treasury reviews, assessments and audits of various contractual arrangements, and subscription to online accounting research tools.
In 2018, VPG did not make use of the rule that waives pre-approval requirements for non-audit services in certain cases if the fees for these services constitute less than 5% of the total fees paid to the independent registered public accounting firm during the year.




16




SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
On March 26, 2019, VPG had outstanding 12,486,440 shares of common stock, each of which entitles the holder to one vote, and 1,025,158 shares of Class B common stock, each of which entitles the holder to 10 votes. Voting is not cumulative. The following table shows the number of shares of VPG common stock and Class B common stock beneficially owned by (a) each director and director nominee, (b) each “Named Executive Officer” identified under “Executive Compensation,” (c) the directors and executive officers of VPG as a group and (d) any person owning more than 5% of VPG common stock or the Class B common stock.
 
 
Common Stock
 
Class B Common Stock
 
 
 
 
 
 
 
 
Right to
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Acquire
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Restricted
 
Ownership
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Stock Units
 
Under
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Scheduled
 
Options
 
 
 
 
 
 
 
 
 
 
 
 
 
 
to vest
 
Exercisable
 
 
 
 
 
 
 
 
 
 
 
 
 Shares of
 
within 60
 
within 60
 
Percent
 
Shares
 
Percent of
 
Voting
Name
 
Stock (1)
 
days
 
days
 
of Class
 
of Stock
 
Class
 
Power (2)
Directors and Named Executive Officers
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Marc Zandman
 
6,110
(3)
1,549
 
-
 
*
 
 
615,593
(4)
60.0
%
 
 
27.1
%
Ziv Shoshani
 
150,128
(3)
-
 
-
 
1.2
%
 
 
615,487
(5)
60.0
%
 
 
27.7
%
Saul V. Reibstein
 
11,276
 
1,549
 
-
 
*
 
 
-
 
 
 
 
 
Timothy V. Talbert
 
13,347
 
1,549
 
-
 
*
 
 
-
 
 
 
 
 
Janet Clarke
 
5,706
 
1,549
 
-
 
*
 
 
-
 
 
 
 
 
Bruce Lerner
 
1,463
 
1,549
 
-
 
*
 
 
-
 
 
 
 
 
Wesley Cummins
 
2,588
 
1,549
 
-
 
*
 
 
-
 
 
 
 
 
William M. Clancy
 
15,717
 
-
 
-
 
*
 
 
-
 
 
 
 
 
Roland B. Desilets
 
2,008
 
-
 
-
 
*
 
 
-
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
All Directors and Executive Officers
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
as a group (9 Persons)
 
205,333
 
9,294
 
-
 
1.7
%
 
 
615,593
 
60.0
%
 
 
28.0
%
c/o Vishay Precision Group, Inc.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3 Great Valley Parkway, Suite 150
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Malvern, PA 19355
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Mrs. Ruta Zandman
 
3,010
(6)
 
 
 
 
*
 
 
787,096
(7)
76.8
%
 
 
34.6
%
c/o Vishay Intertechnology, Inc.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
63 Lancaster Avenue
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Malvern, PA 19355
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Nokomis Capital, L.L.C. (8)
 
1,944,030
 
 
 
 
 
15.6
%
 
 
 
 
 
 
 
8.5
%
2305 Cedar Springs Rd. , Suite 420
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Dallas, TX 75201
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Dimensional Fund Advisors LP (9)
 
997,448
 
 
 
 
 
8.0
%
 
 
 
 
 
 
 
4.4
%
Palisades West, Building One
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
6300 Bee Cave Road
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Austin, TX 78746
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

17




BlackRock Inc. (10)
 
780,172
 
 
 
 
 
6.2
%
 
 
 
 
 
 
 
3.4
%
55 East 52nd Street
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New York, NY 10022
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Renaissance Technologies LLC (11)
 
732,638
 
 
 
 
 
5.9
%
 
 
 
 
 
 
 
3.2
%
800 Third Avenue
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New York, NY 10022
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Eugenia A. Ames (12)
 
 
 
 
 
 
 
 
 
 
91,161
 
8.9
%
 
 
4.0
%
c/o Mr. Leroy Rachlin
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Janney Montgomery Scott
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
780 Route 37 West, Suite 130
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Toms River, NJ 08755
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Deborah S. Larkin
 
 
 
 
 
 
 
 
 
 
59,016
 
5.8
%
 
 
2.6
%
c/o Mr. Bruce Auerbach
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
World Financial Center
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
270 Madison Avenue, Suite 1503
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New York, NY 10016
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Barbara J. Winslow
 
 
 
 
 
 
 
 
 
 
51,873
 
5.1
%
 
 
2.3
%
90 Eighth Avenue, Apt. 8B
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Brooklyn, NY 11213
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
____________________

18




*
Represents less than 1% of the outstanding shares of such class or the total voting power, as the case may be.
(1)
In addition to the amounts shown, each share of Class B common stock held by such holder, if applicable, may be converted into one share of common stock upon the election of such holder.
(2)
The percentage of total voting power represents voting power with respect to all shares of common stock and Class B common stock, as a single class, calculated on the basis of 10 votes per share of Class B common stock and one vote per share of common stock.
(3)
Includes 3,010 shares of commons stock held in a family trust, of which Mrs. Ruta Zandman, Mr. Marc Zandman, and Mr. Ziv Shoshani are co-trustees and have shared voting power.
(4)
Includes 615,487 shares of Class B common stock held in a family trust, of which Mrs. Ruta Zandman, Mr. Marc Zandman, and Mr. Ziv Shoshani are co-trustees and have shared voting power; 53 shares of Class B common stock directly owned by Mr. Zandman; and 53 shares of Class B common stock owned by Mr. Zandman’s child.
(5)
Includes 615,487 shares of Class B common stock held in a family trust, of which Mrs. Ruta Zandman, Mr. Marc Zandman, and Mr. Ziv Shoshani are co-trustees and have shared voting power.
(6)
Includes 3,010 shares of commons stock held in a family trust, of which Mrs. Ruta Zandman, Mr. Marc Zandman, and Mr. Ziv Shoshani are co-trustees and have shared voting power.
(7)
Includes 615,487 shares of Class B common stock held in a family trust, of which Mrs. Ruta Zandman, Mr. Marc Zandman, and Mr. Ziv Shoshani are co-trustees and have shared voting power. Pursuant to the family trust, each of Mrs. Zandman and Messrs. Zandman and Shoshani is required to cause shares controlled by the trust to be voted in support of the election of Mr. Zandman and Mr. Shoshani as directors of the Company. Additionally, includes 171,609 shares of Class B common stock held by third parties that are subject to a voting agreement pursuant to which Mrs. Zandman, may direct voting of such shares, to the extent that, and in the same manner as, a majority of shares of Class B Common Stock held by Mrs. Zandman, the family trust, of which Mrs. Ruta Zandman, Mr. Marc Zandman and Mr. Ziv Shoshani are co-trustees and have shared voting power, and their respective “permitted transferees” (as such term is defined in the Company’s amended and restated certificate of incorporation) are voted on such matter.
(8)
Based on information provided in a Schedule 13D/A filed on July 28, 2017 by Nokomis Capital, L.L.C. According to the Schedule 13D/A, Nokomis Capital, L.L.C. and Brett Hendrickson share the power to vote and to dispose of 1,944,030 shares of common stock.
(9)
Based on information provided in a Schedule 13G/A filed on February 8, 2019 by Dimensional Fund Advisors LP. According to the Schedule 13G/A, Dimensional Fund Advisors LP, in its capacity as an investment advisor, may be deemed to have the sole power to vote or to direct the vote with respect to 962,207 shares of common stock and may also be deemed to have the sole power to dispose of 997,448 shares of common stock.
(10)
Based on information provided in a Schedule 13G/A filed on February 6, 2019 by BlackRock, Inc. According to the Schedule 13G/A, BlackRock, Inc. may be deemed to have sole power to vote or direct the vote with respect to 763,729 shares of common stock and may also be deemed to have the sole power to dispose or direct the disposition with respect to 780,172 shares of common stock.
(11)
Based on information provided in a Schedule 13G filed on February 13, 2019 by Renaissance Technologies LLC. According to the Schedule 13G Renaissance Technologies LLC may be deemed to have sole power to vote or direct the vote with respect to 672,300 shares of common stock and may also be deemed to have the sole power to dispose or direct the disposition with respect to 711,902 shares of common stock.
(12)
Includes 91,161 shares of Class B common stock that are subject to a voting agreement pursuant to which Mrs. Ruta Zandman may direct the voting of such shares.

Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our directors and executive officers and persons who beneficially own more than ten percent of our common stock to report their ownership of, and transactions in, our stock in filings with the SEC. Copies of these reports are also required to be supplied to VPG. VPG believes, based solely on a review of the copies of such reports received, that our directors and executive officers and persons who beneficially own more than ten percent of our common stock complied with all applicable Section 16(a) reporting requirements during the year ended December 31, 2018, except that Messrs. Shoshani and Clancy each filed one late Form 4 reporting shares disposed of with respect to tax withholdings due to administrative error.
 Compensation Committee Interlocks and Insider Participation
No member of the Compensation Committee was at any time during 2018 an officer or employee of VPG or any of the Company’s subsidiaries nor was any such person a former officer of VPG or any of the Company’s subsidiaries. In addition, no Compensation Committee member is an executive officer of another entity at which one of the Company’s executive officers serves on the board of directors.


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EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
This Compensation Discussion and Analysis describes the Company’s executive compensation program and explains how the Compensation Committee made compensation decisions for our Named Executive Officers (the “NEOs”) who are identified below:
 
Named Executive Officer
Position
Ziv Shoshani
President and Chief Executive Officer
William M. Clancy
Executive Vice President and Chief Financial Officer
Roland B. Desilets
Vice President and General Counsel
Compensation Philosophy and Objectives
Our executive compensation program is designed to assist us in recruiting, retaining and motivating our NEOs and providing our NEOs with an appropriate level of compensation, commensurate with their contributions to the Company. The Compensation Committee believes that the elements of our executive compensation program, as well as the mix of these elements in relation to total compensation, reward sound management decisions and do not encourage undue risk taking to enhance short-term profitability at the expense of the long-term financial health of the Company. The Compensation Committee seeks to mitigate any compensation-related risk by:
providing a meaningful portion of total compensation in the form of equity incentives that are earned over multiple years (to encourage a long-term focus); and
capping annual cash bonuses for our NEOs at 200% of base salary for Mr. Shoshani and at 80% of base salary for both Mr. Clancy (adjusted to 105% as of January 1, 2019) and Mr. Desilets (to provide appropriate balance between short- and long-term objectives).
Please see the discussion below under the headings “Performance Bonus” and “Equity Compensation” for further detail regarding performance bonus and long-term equity incentive targets.
Development of 2018 Peer Group
During 2018, the Compensation Committee again engaged Meridian Compensation Partners, LLC (“Meridian”) to advise it regarding executive compensation. In the course of its engagement, Meridian developed, and the Compensation Committee approved, a custom peer group of public companies that were, substantially similar to the Company in terms of industry, revenues, and scope of international operations. The 2018 peer group consisted of the following companies:
Badger Meter, Inc.
Mercury Systems, Inc
CSW Industries, Inc.
Nanometrics Incorporated
CTS Corp.
Park Electrochemical Corp.
Daktronics Inc.
Hurco Companies, Inc.
Electro Scientific Industries Inc.
Raven Industries, Inc.
Rudolph Technologies, Inc.
Control4 Corporation
Faro Technologies Inc.
Amtech Systems, Inc.
Maxwell Technologies Inc.
 

Based on data derived from peer group companies’ public filings, Meridian presented a study to the Compensation Committee that assessed the competitiveness of our executive compensation practices, structures. pay mix and pay levels. The Compensation Committee considered peer group pay practices as one among several factors in setting 2018 executive compensation levels.



20




Role of the Compensation Consultant
As permitted under its charter, the Compensation Committee retained Meridian as its independent compensation consultant for 2018. Meridian provided advice to the Compensation Committee on our executive compensation program. In particular, Meridian advised the Compensation Committee on our 2018 compensation peer group and provided the Compensation Committee an assessment of our executive compensation program against peer group practices.
The Compensation Committee determined that the work performed by Meridian did not give rise to a conflict of interest and that Meridian was independent of management. In making this determination, the Compensation Committee considered the factors outlined in the NYSE listing standards relating to compensation consultant independence, including whether the compensation consultant has provided other services to the Company, the magnitude of the projected fees payable to the compensation consultant in the context of the Company’s total revenues, the absence of personal or business relationships between members of the Compensation Committee or the Company’s executive officers and the compensation consultant, and whether any member of the compensation consultant’s team owns, or otherwise has an investment or interest in, the Company’s common stock.
Compensation Components
The following are the primary components of our executive compensation program:
Base salary;
Annual performance bonus (payable in cash); and
Annual long-term equity incentive compensation (payable in RSUs).
In addition to the foregoing, our NEOs are eligible to receive severance and customary welfare and retirement benefits. Each of the primary components of our executive compensation program, and the methodology used to determine the amounts, and mix, of such compensation, are discussed below.
Base Salaries
Minimum base salaries for our NEOs are established in their respective employment agreements, the material terms of which are summarized below under the heading “Employment Agreements.” Each year, the Compensation Committee reviews the appropriateness of each NEO’s base salary. In determining whether to increase base salary of an NEO, the Compensation Committee considers the following factors: competitive market data derived from our peer group, individual and Company performance, and the NEO’s role and responsibilities. We believe that setting our NEOs' base salaries based on the foregoing factors helps us to retain our NEOs, while appropriately motivating them to fulfill their core responsibilities and duties.
Variations in base salary among our NEOs reflect the differences in their respective positions, duties and responsibilities.
Effective January 1, 2018, for Mr. Shoshani, Mr. Clancy and Mr. Desilets, the annual base salaries for our NEOs were increased as follows:
 
2018
 
2017
 
 
Executive
Base Salary
 
Base Salary
 
% increase
Ziv Shoshani
 
 
 
 
 
 
 
       President and Chief Executive Officer (1)
$
597,172
 
$
566,701
 
5.4%
William M. Clancy
 
 
 
 
 
 
 
       Executive Vice President and Chief Financial Officer
 
353,600
 
 
340,000
 
4.0%
Roland B. Desilets
 
 
 
 
 
 
 
       Vice President and General Counsel
 
286,000
 
 
275,000
 
4.0%
____________________

21




(1)
Pursuant to Mr. Shoshani’s employment agreement, his 2018 base salary is 2,145,938 NIS. The U.S. Dollar amount shown in the table is based on the weighted average exchange rate for 2018 of 3.5935. Mr. Shoshani's 2017 base salary was 2,043,750 NIS. The U.S. Dollar amount shown in the table is based on the weighted average exchange rate for 2017 of 3.6064.

Annual Performance Cash Bonus
Our 2018 annual performance cash bonus program was designed to incent our NEOs to achieve certain predetermined objectives set by the Compensation Committee and the Board.
The 2018 annual performance cash bonus payouts were based on achievement of two equally weighted corporate objectives: adjusted operating margin and adjusted EBITDA. The target levels of adjusted operating margin and adjusted EBITDA for 2018 were set at $25.7 million and $37.3 million, respectively.
Adjusted operating margin and adjusted EBITDA mean, respectively, operating margin and earnings before interest, taxes, depreciation and amortization, in each case determined in accordance with accounting principles generally accepted in the United States and adjusted to exclude various items that are not indicative of the intrinsic operating performance of our business, including restructuring and related severance costs, fixed asset or inventory write-downs and related purchase commitment charges, impairment charges for goodwill or indefinite-lived intangible assets, and individually material one-time gains or charges. The Board determined that adjusted operating margin for 2018 should exclude the impact of $2,820,000 for impairment of goodwill and indefinite-lived intangibles and $289,000 in restructuring costs. The Board determined that adjusted EBITDA for 2018 should exclude the impact of $2,820,000 for impairment of goodwill and indefinite-lived intangibles, $673,000 for UK pension settlement and $289,000 in restructuring costs.
These performance targets were intended to represent challenging, but reasonable, goals, the achievement of which will contribute meaningfully to long-term stockholder value creation as well as the short-term success of our business.
If less than 80% of the target for a performance goal were attained, the NEOs would not receive any portion of the performance bonus tied to such performance goal. The table below sets forth the payments that each of Messrs. Shoshani, Clancy, and Desilets would have been eligible to receive (expressed as a percentage of his base salary) pursuant to his employment agreement with respect to each 2018 performance objective, based upon various levels of actual performance.


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Potential Performance Bonus Payments for Messrs. Shoshani, Clancy, and Desilets for Each Performance Objective, in Relation to Target Performance*
 
 
 
 
Percentage of Target Performance Objective
 
 
 
 
 
 
Achieved
 
Maximum
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Performance
 
 
 
80% of 
 
80—100% of 
 
100—150% of 
 
Bonus for
 
 
 
Target
 
Target
 
Target
 
Each
 
 
Performance
 
Performance
 
Performance
 
Performance
 
Performance
Executive
 
Objective
 
Objective
 
Objective
 
Objective
 
Objective
Ziv Shoshani
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
President and
 
Adjusted EBITDA
 
25
%
 
 
25-50
%
 
 
 
50-100
%
 
100
%
 
Chief Executive Officer
 
Adjusted Operating Margin
 
25
%
 
 
25-50
%
 
 
 
50-100
%
 
100
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
William M. Clancy
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Executive Vice President
 
Adjusted EBITDA
 
13.35
%
 
 
13.35-25
%
 
 
 
25-40
%
 
40
%
 
and Chief Financial Officer
 
Adjusted Operating Margin
 
13.35
%
 
 
13.35-25
%
 
 
 
25-40
%
 
40
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Roland B. Desilets
 
Adjusted EBITDA
 
13.35
%
 
 
13.35-25
%
 
 
 
25-40
%
 
40
%
 
Vice President and
 
Adjusted Operating Margin
 
13.35
%
 
 
13.35-25
%
 
 
 
25-40
%
 
40
%
 
General Counsel
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
*
All performance bonus payments set forth in this table are expressed as a percentage of the applicable executive officer’s base salary and represent the potential payments to our executive officers with respect to each performance objective.
The aggregate target performance bonuses for each of Messrs. Shoshani, Clancy, and Desilets, pursuant to their employment agreements and taking into account all 2018 performance objectives, were 100%, 50%, and 50% of their respective base salaries. Mr. Clancy's target performance bonus was increased to 65% of his base salary and his maximum bonus increased to 105% of base salary, effective as of January 1, 2019. The maximum 2018 performance bonuses payable to Messrs. Shoshani, Clancy, and Desilets were 200%, 80%, and 80% of their respective base salaries. We believe that the target and maximum performance bonus levels and the corresponding payouts are such that they do not encourage excessive risk-taking and represent appropriate compensation in light of each executive officer’s responsibilities.

The Board and the Compensation Committee determined that our 2018 adjusted EBITDA was $50.1 million (or 134% of the target) and our 2018 adjusted operating margin was $40.3 million (or 157% of the target). Accordingly, for the adjusted EBITDA target, Messrs. Shoshani, Clancy and Desilets each received a cash bonus equal to 84.43%, 35.33%, and 35.33% of their respective base salaries. For the adjusted operating margin target, Messrs. Shoshani, Clancy and Desilets each received a cash bonus equal to 100.0%, 40.0% and 40.0% of their respective base salaries.
 
The total of these performance bonuses for each executive is reflected under the “Non-Equity Incentive Compensation Plan” column of the Summary Compensation Table herein.

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Equity Compensation
Our executive compensation program uses the grant of long-term equity awards as the primary tool for aligning the interests of our NEOs with the long-term interests of our stockholders. The NEOs’ employment agreements established the following target value of their respective annual equity grants.

On or about January 1 of each year, each NEO receives equity awards ("Annual Equity Grant"), with an aggregate value equal to the following percentages of their then base salary: 150% (with respect to Mr. Shoshani and increased to 175% as of January 1, 2019), 75% (with respect to Mr. Clancy), and 50% (with respect to Mr. Desilets). The Annual Equity Grant, which is in the form of restricted stock units (“RSUs”) of VPG, is sized based on the average closing price of VPG’s stock on the New York Stock Exchange for the five consecutive trading days immediately preceding January 1 of the year of grant.
75% of the Annual Equity Grant is in the form of performance-based RSUs (“PBRSUs”) which vest on January 1 of the third year following the date of grant, but only to the extent that performance criteria have been achieved and provided the executive remains continuously employed by us through such date. The performance criteria are determined by the Compensation Committee and are based on metrics set forth in the 2010 Stock Incentive Program.
25% of the Annual Equity Grant is in the form of time-vested RSUs which vest on January 1 of the third year following the date of grant provided the executive remains continuously employed by us through such date.
The Annual Equity grant is subject to accelerated vesting upon a change of control of the Company, an event giving rise to a severance entitlement, death or disability.

With respect to each performance criterion, and as illustrated below, (i) 50% of the total number of PBRSUs subject to such criterion will vest if 80% of the applicable objective is met, and (ii) an additional 2.5% of the total number of PBRSUs subject to such criterion will vest for each additional full 1% (between 80% and 100%) of the applicable objective that is met. If the 80% threshold target for a performance goal is not attained, the NEOs would not receive any portion of the PBRSUs attributable to such target and that portion of the PBRSU grant would be forfeited.

2018 Annual Equity Grant Components
 
 
 
 
Performance-Based RSUs for Each Performance Objective
Executive
 
Time-Vested RSUs
(# of RSUs)
 
80% of
Target
(# of PBRSUs)
 
80—100% of Target
(# of PBRSUs)
Ziv Shoshani
 
9,052
 
6,789
 
6,789 - 13,578
William M. Clancy
 
2,592
 
1,944
 
1,944 - 3,888
Roland B. Desilets
 
1,398
 
1,048
 
1,048 -2,096

Vesting of the PBRSUs is subject to the achievement over the three-year performance period ending on December 31, 2020 of two equally weighted corporate objectives: cumulative Adjusted Net Earnings and cumulative Free Cash.
“Adjusted Net Earnings” means the Company’s net profits after taxes, including the impact of acquisitions, if any, adjusted for reconciling items as set forth in the associated years' annual reports to stockholders. “Free Cash” means the amount of cash generated from the Company’s operations in excess of capital expenditures and net of proceeds from the sale of assets, including the impact of acquisitions, if any.
The target levels of Adjusted Net Earnings and Free Cash over that three-year period from 2018-2020 were set at $60,310,000 and $53,040,000, respectively. The Company's achieved performance against each of these performance goals determines the vesting for fifty percent (50%) of the total number of PBRSUs granted to each NEO. These targets

24




are intended to represent challenging, but reasonable, goals, the achievement of which will contribute meaningfully to long-term stockholder value creation as well as the long-term success of our business.
Each executive who received a 2018 Annual Equity Grant is eligible to vest in a portion of the PBRSUs included within the 2018 Annual Equity Grant to the extent that our performance with respect to one or both of the objectives equals at least 80% of the targeted amount. If the 80% threshold target for a performance goal is not attained, the executive would not receive any portion of the PBRSUs attributable to such target and that portion of the grant would be forfeited. The table above sets forth the vesting of the PBRSUs that each executive officer would be eligible to receive (expressed as a number of shares) pursuant to his respective employment agreement with respect to each 2018 performance objective, based upon various levels of actual performance.
The Annual Equity Grants awarded to each of the NEOs in 2018 are included in the “Stock Awards” column in the Summary Compensation Table herein.
In January 2016, and as previously described in our 2017 Proxy Statement, Mr. Shoshani, Mr. Clancy and Mr. Desilets were granted PBRSUs that were subject to vesting based on two performance conditions - Adjusted Net Earnings and Free Cash - measured over a three-year period ended December 31, 2018. The Compensation Committee determined, after reviewing the Company’s performance during this measurement period, that the Company had achieved 92.0% of the target for Free Cash and 78.5% of the target for Adjusted Net Earnings. Accordingly, for the PBRSUs granted to our NEOs in January 2016, 92% of the PBRSUs for the Free Cash target vested and 0.0% of the PBRSUs for the Adjusted Net Earnings target vested.
Employment Agreements
The Company entered into employment agreements, which were amended in December 2011, with Messrs. Shoshani and Clancy that provide for the specific targets and payment opportunities in connection with each element of our executive compensation package discussed herein under the heading “Compensation Components.”
In November 2013, the Company entered into additional amendments to the employment agreements with Mr. Shoshani and Mr. Clancy which became effective on January 1, 2014 and which increased the base salary, target performance bonus, and the value of annual equity incentive awards for each of Messrs. Shoshani and Clancy beginning in 2014.
In January 2016, the Company entered into an employment agreement with Mr. Desilets that provides for a one year term that began on January 1, 2016.
Upon expiration of the current applicable term, all of our executives’ employment agreements automatically renew for one additional year unless earlier terminated by the Company or by the executive officer. Each of the employment agreements provides for certain severance payments to the executive officers in the event of termination of their employment as described in greater detail under the heading “Potential Payments Upon a Termination or Change in Control.” The employment agreements for Messrs. Clancy and Desilets were amended, effective November 17, 2016, to extend the period of time during which the executives are entitled to receive continuation of their base salary following a termination without Cause (as such term is defined in their respective employment agreements) to 18 months after termination and provide the executives with COBRA continuation coverage of their health insurance following a termination without Cause until the 18 month anniversary of termination, or, if earlier, the date as of which the executive is eligible to receive health insurance through another group plan.
The employment agreement for Mr. Desilets was amended, effective January 1, 2018, to increase his performance bonus as a percentage of base salary from 40% to 50%, as detailed in the section on Potential Performance Bonus Payments above, and to increase his annual equity award value to 50% of his base salary, as detailed in the section Equity Compensation above. Mr. Clancy's employment agreement was amended effective as of January 1, 2019 to increase his target performance bonus as a percentage of base salary to 65% and his maximum performance bonus to 105%.  Also, the employment agreement for Mr. Shoshani was amended in 2017 to document certain rights and obligations to which Mr. Shoshani was entitled, and subject to, due to his status as an employee in Israel, and further amended effective as of January 1, 2019 to increase his annual equity award value as a percentage of base salary to 175%, as detailed in the section on Potential Performance Bonus Payments..
The employment agreements also contain customary non-solicitation and non-competition covenants, which remain in effect for 24 months following termination of employment with respect to Mr. Shoshani and for 12 months following termination of employment with respect to Messrs. Clancy and Desilets. The agreements also entitle the executives

25




to additional perquisites and other personal benefits as the Board, through its Compensation Committee, determine are reasonable and consistent with the Company’s overall compensation program.
Deferred Compensation and Pension Plans
Vishay Intertechnology maintained, among other benefit plans, a non-qualified defined benefit plan (the “Vishay Non-Qualified Retirement Plan”); a qualified defined contribution plan (the “Vishay Employee Savings Plus Plan”); and a non-qualified deferred compensation plan (the “Vishay Key Employee Wealth Accumulation Plan” or “VSH KEWAP”), for highly compensated employees, including executive officers. In anticipation of the spin-off, we formed parallel plans that provide for substantially similar benefits. In connection with the spin-off, Vishay Intertechnology caused the accounts and underlying assets and liabilities under the Vishay Intertechnology plans for our employees who were participating in those plans to be transferred to our corresponding plans or, in the case of Vishay Non-Qualified Retirement Plan and VSH KEWAP assets, from a rabbi trust established by Vishay Intertechnology to a rabbi trust that we established.
With the exception of Mr. Clancy, none of our NEOs participated in the Vishay Non-Qualified Retirement Plan. The Vishay Non-Qualified Retirement Plan was frozen effective December 31, 2008, and no further benefits have accrued beyond that date. In connection with the spin-off, we established a corresponding plan, the “VPG Non-Qualified Retirement Plan,” to preserve the benefits accumulated by certain of our employees under the Vishay Non-Qualified Retirement Plan. Only active employees who participated in the Vishay Non-Qualified Retirement Plan as of December 31, 2008 are eligible to participate in the parallel VPG plan. In connection with the freezing of the Vishay Non-Qualified Retirement Plan, Mr. Clancy became eligible to participate in a supplemental matching program under the Vishay Employee Savings Plus Plan, pursuant to which amounts were deposited in his VSH KEWAP account. This supplemental matching program continues under the corresponding VPG plans.
Every employee who has been designated as an Eligible Executive by the administrator of the plan, including our executive officers, is eligible to participate in our non-qualified deferred compensation plan (the “VPG KEWAP”). The VPG KEWAP permits eligible executives to make voluntary contributions and provides for discretionary Company contributions. In addition, we are required to make contributions on behalf of Mr. Clancy to his VPG KEWAP account as described above.
Perquisites
We provide executive officers with perquisites and other personal benefits that the Compensation Committee believe are reasonable and consistent with our overall executive compensation program. These perquisites are not intended, however, to constitute a material portion of the executive’s compensation packages. In general, the perquisites, while not integral to the performance of an executive’s duties, must bear some relationship to the executive’s employment and be of perceived benefit to VPG. The Compensation Committee periodically reviews the levels of perquisites and other personal benefits provided to our NEOs.

Individual Considerations
Compensation among the Company’s NEOs reflects a general assessment of their contributions to the Company’s current performance and its prospects for growth in the future. Our successes have always been fueled by the drivers of technological innovation, continuous efficiency improvement and synergistic acquisition. Mr. Shoshani leads in all these areas and his compensation reflects a perception by the Compensation Committee that the areas of his responsibility will continue to be the key drivers of our future performance.
Other Considerations Regarding Executive Compensation
Israeli benefits
Mr. Shoshani is employed by Vishay Advanced Technologies, Ltd., an Israeli subsidiary of VPG, and is a resident of Israel. As a result, he is entitled to certain benefits that are generally available to employees in Israel on a non-discriminatory basis, but are not afforded to the other NEOs, including:
advanced training fund, 7.5% of base salary
severance fund, 8.33% of base salary
disability insurance, 0.9% of base salary

26




pension fund, 5.6% of base salary
These benefits are required by Israeli law or employment practices generally, and were taken into account by the Compensation Committee in formulating the overall compensation package for Mr. Shoshani.
Foreign currency considerations
The Compensation Committee evaluates the effect of foreign currency conversion rates in formulating the overall compensation package for Mr. Shoshani, and determined to set Mr. Shoshani’s base salary in New Israeli Shekels beginning January 1, 2015. Effective January 1, 2018, Mr. Shoshani’s base salary was NIS 2,145,938 on an annual basis.
Tax deductibility of executive compensation
For U.S. tax purposes, as a result of 2017 tax reform, Section 162(m) of the Internal Revenue Code ("Code") now limits to $1 million the annual tax deduction for compensation paid to each of the CEO, the Chief Financial Officer and any of the three highest paid other executive officers. Prior to 2017 tax reform, compensation that qualified as performance-based compensation was deductible even in excess of $1 million. As part of its role, the Compensation Committee reviews and considers the deductibility of executive compensation under Section 162(m) of the Code and the Compensation Committee is currently assessing the effects of the changes to Section 162(m) of the Code under 2017 tax reform, including whether certain payments qualify for transition relief applicable to certain arrangements in place as of November 2, 2017.
As a general matter, in making its previous compensation decisions, the Compensation Committee endeavored to maximize deductibility of compensation under Section 162(m) to the extent practicable while maintaining competitive compensation. The Compensation Committee, however, believes that it is important for it to retain maximum flexibility in designing compensation programs that are in the best interests of the Company and its stockholders.
Executive Compensation Advisory Vote and Its Frequency
The Company’s Board of Directors included an advisory stockholder vote on executive compensation (commonly referred to as "say-on-pay") in its 2018 proxy materials. The Compensation Committee appreciates that over 96% of the votes cast on such proposal approved the executive compensation discussed and disclosed in the Compensation Discussion and Analysis, the compensation tables, and the narrative executive compensation disclosure contained in our 2018 Proxy Statement. Our Compensation Committee interprets the results of this vote as an endorsement of existing programs and therefore, we have not made material changes to our approach to executive officer compensation based on such vote.
In addition, the Board of Directors included in its 2017 proxy materials an advisory stockholder vote on how frequently it should conduct a “say-on-pay” vote. In line with the Board of Directors’ recommendation, a majority of the shares voting recommended that the Company conduct a “say-on-pay” vote annually. Therefore, our Board of Directors is again this year submitting for a non-binding stockholder vote our executive compensation as described in this proxy statement.
 

27




REPORT OF THE COMPENSATION COMMITTEE
 
To Our Stockholders:
 
We have reviewed and discussed with management the Compensation Discussion and Analysis. Based on that review and discussion, we have recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement.
 
Respectfully submitted,
 
The Compensation Committee of the Board of Directors
 
Janet Clarke, Chair
Saul Reibstein
Timothy Talbert
 
Notwithstanding anything to the contrary set forth in any of our previous or future filings under the Securities Act or the Exchange Act that might incorporate this proxy statement in such filings with the SEC, in whole or in part, the above report shall not be deemed to be “soliciting material” or “filed” with the SEC and shall not be deemed to be incorporated by reference into any such filing.


28




COMPENSATION TABLES
Summary Compensation Table
The information included in the table should be read in conjunction with the footnotes which follow, the descriptions of the employment agreements with each NEO described in “Compensation Discussion and Analysis,” and the “Grants of Plan Based Awards,” “Outstanding Equity Awards,” “Option Exercises and Stock Vested,” “Pension Benefits,” and “Non-Qualified Deferred Compensation” tables on the pages which follow.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Change in
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pension
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Value and
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-Equity
 
Nonqualified
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Incentive Plan
 
Deferred Comp.
 
All Other
 
 
 
 
 
 
 
Salary
 
Bonus
 
Stock Awards
 
Option Awards
 
Compensation
 
Earnings
 
Comp.
 
 
Total
 
 
 
 
(1)
 
 
 
(2)
 
 
 
(3)
 
(4) (5)
 
(6)
 
 
Name and Principal Position
 
Year
 
($)
 
($)
 
($)
 
($)
 
($)
 
($)
 
($)
 
($)
(a)
 
(b)
 
(c)
 
(d)
 
(e)
 
(f)
 
(g)
 
(h)
 
(i)
 
(j)
Ziv Shoshani
 
2018
 
$
597,172
 
$
 
$
925,140

 
$
 
$
1,101,364
 
$
 
$
242,320
 
$
2,865,996
President and Chief
 
2017
 
$
566,701
 
$
 
$
650,966

 
$
 
$
720,742
 
$
26,335
 
$
229,093
 
$
2,193,837
Executive Officer
 
2016
 
$
487,767
 
$
 
$
662,139

 
$
 
$
131,880
 
$
15,352
 
$
199,311
 
$
1,496,449
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
William M. Clancy
 
2018
 
$
353,600
 
$
 
$
264,877

 
$
 
$
266,363
 
$
 
$
83,405
 
$
968,245
Executive Vice President and
 
2017
 
$
340,000
 
$
 
$
201,021

 
$
 
$
197,726
 
$
57,400
 
$
69,173
 
$
865,320
Chief Financial Officer
 
2016
 
$
300,000
 
$
 
$
206,797

 
$
 
$
42,898
 
$
24,190
 
$
67,846
 
$
641,731
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Roland B. Desilets
 
2018
 
$
286,000
 
$
 
$
142,825

 
$
 
$
215,441
 
$
 
$
33,322
 
$
677,588
Vice President and
 
2017
 
$
275,000
 
$
 
$
56,448

 
$
 
$
139,900
 
$
 
$
32,877
 
$
504,225
General Counsel
 
2016
 
$
210,592
 
$
 
$
58,067

 
$
 
$
14,611
 
$
 
$
31,675
 
$
314,945
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

____________________

29




(1)
 
Column (c) reflects each NEO’s base salary. Effective January 1, 2019, Mr. Shoshani’s salary was increased to be 2,145,938 New Israeli Shekels. In 2018, the average New Israeli Shekel/U.S. Dollar exchange rate was 3.5935 NIS per U.S. Dollar. 
 
(2)
 
Column (e) represents the grant-date fair value of RSUs granted to each NEO in connection with the long-term equity award component of his compensation and in accordance with his employment agreement, computed in accordance with FASB ASC Topic 718 and the assumptions as set forth in Note 10 of our consolidated financial statements on Form 10-K filed on March 14, 2019, and assuming that all performance criteria are completely satisfied. For financial statement reporting purposes, the amount of compensation expense for RSUs is recognized ratably over the vesting period of the respective awards. The grant-date fair value does not necessarily reflect the value of shares actually received or which may be received in the future with respect to these awards.
 
(3)
 
Column (g) represents performance-based cash bonuses that our NEOs received with respect to performance in the applicable year. See “Compensation Discussion and Analysis—Compensation Components, Performance Bonus.”
 
(4)
 
Column (h) reflects the change in the actuarial present value of the NEOs pension and other post-employment benefits under respective defined benefit retirement plans, from the plan measurement date used in preparing the prior year consolidated financial statements to the plan measurement date used in preparing the current year consolidated financial statements, determined using the same interest rate, mortality, and other actuarial assumptions used in our consolidated financial statements. For Messrs. Shoshani and Clancy, the change in the pension benefit for 2018 was ($12,067) and ($38,740), respectively. See the “Pension Benefits” table herein for more information on the benefits payable to the NEOs under their respective pension plans.
 
(5)
 
Each NEO is entitled to participate in the VPG non-qualified deferred compensation plan, which is substantially similar to its predecessor plan sponsored by Vishay Intertechnology at the time of the spin-off. Under the VPG non-qualified deferred compensation plan, deferred amounts are credited with earnings based on the performance of notional investment options available under the plan. No portion of the earnings credited during 2018 was “above market” or “preferential.” Consequently, no deferred compensation plan earnings are included in the amounts reported in Column (h). See the “Non-Qualified Deferred Compensation” table for more information on the benefits payable under the VPG non-qualified deferred compensation plan.
 
(6)
 
All other compensation includes amounts deposited on behalf of each NEO into VPG’s non-qualified deferred compensation plan, pursuant to the employment agreements with each NEO, personal use of company car, company match on 401(k) contributions, benefits generally available to employees in Israel, and other perquisites, as described herein:
 
2018
 
 
Ziv Shoshani
$
27,417

 
Personal use of Company car*
 
193,534

 
Israeli employment benefits*
 
21,369

 
Medical and prescription drug insurance premiums
 
$
242,320

 
 
 
 
 
 
William M. Clancy
$
31,448

 
Company contribution to nonqualified deferred compensation plan
 
16,836

 
Personal use of Company car
 
10,800

 
Company match to 401(k) plan
 
21,999

 
Medical and prescription drug insurance premiums
 
2,322

 
Group Term Life imputed income
 
$
83,405

 
 
 
 
 
 
Roland B. Desilets
$
11,852

 
Personal use of Company car
 
10,800

 
Company match to 401(k) plan
 
8,348

 
Medical and prescription drug insurance premiums
 
2,322

 
Group Term Life imputed income
 
$
33,322

 
 
 
 
 
 
____________________
* Represents amounts paid in New Israeli Shekels (NIS) and translated at average exchange rates for the year. In 2018, the average New Israeli Shekel/U.S. Dollar exchange rate was 3.5935 NIS per U.S. Dollar.



30




Grants of Plan Based Awards
The following table provides information with regard to plan based awards granted to each NEO during 2018. The information included in the table should be read in conjunction with the footnotes which follow and the description of performance bonuses and long-term equity incentive awards described in “Compensation Discussion and Analysis—Compensation Components.”
The following table provides information concerning grants of plan-based awards to our NEOs during the year ended December 31, 2018.
 
 
 
 
 
 
 
 
 
 
Grant Date
 
 
 
 
 
 
 
 
All Other
 
Fair Value of
 
 
 
 
Estimated Future Payouts Under Non-
Equity Incentive Plan Awards (1)
 
Estimated Future Payouts Under
Equity Incentive Plan Awards (2)
 
Stock Awards (3)
 
Stock Awards (4)
Name
 
Grant Date
 
Threshold
($)
 
Target
($)
 
Maximum ($)
 
Threshold
(#)
 
Target (#)
 
Maximum
(#)
 
(#)
 
($)
Ziv Shoshani
 
 
 
298,586
 
 
597,172
 
 
1,194,344
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2/16/18
 
 
 
 
 
 
 
 
 
13,579
 
 
27,157
 
 
27,157
 
 
 
693,861
 
 
2/16/18
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
9,052
 
231,279
William M. Clancy
 
 
 
94,411
 
 
176,800
 
 
282,880
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2/16/18
 
 
 
 
 
 
 
 
 
3,888
 
 
7,775
 
 
7,775
 
 
 
198,651
 
 
2/16/18
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,592
 
66,226
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Roland B. Desilets
 
 
 
76,362
 
 
143,000
 
 
228,800
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2/16/18
 
 
 
 
 
 
 
 
 
2,096
 
 
4,192
 
 
4,192
 
 
 
107,106
 
 
2/16/18
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,398
 
35,719
____________________
 
(1)
 
For 2018, Mr. Shoshani, Mr. Clancy, and Mr. Desilets were each eligible to earn an annual performance bonus based on the achievement of each of adjusted EBITDA and adjusted operating margin targets. The threshold value for each NEO was determined assuming that each performance metric applicable to such bonus for each NEO was satisfied at the minimum level triggering payment. An executive is not entitled to receive any bonus payment with respect to a particular performance metric if less than 80% of the performance target is achieved. Each NEOs performance bonus is further described under the heading “Compensation Discussion and Analysis—Compensation Components, Performance Bonus.” Performance bonuses relating to our NEOs 2018 performance were paid, to the extent earned, in March 2019.
 
(2)
 
For 2018, each of Messrs. Shoshani, Clancy, and Desilets was granted an annual long-term equity incentive award, 75% of which was in the form of performance-based RSUs which will vest on January 1, 2021, to the extent that each performance metric is achieved. The threshold figure for each NEO was determined assuming that each performance metric applicable to such bonus for each NEO was satisfied at the minimum level triggering vesting. An executive is not entitled to receive any vesting with respect to a particular performance metric if less than 80% of the performance metric is achieved. Each NEOs long-term equity award is further described under the heading “Compensation Discussion and Analysis—Compensation Components, Equity Compensation.” Long-term equity incentive awards for our NEOs for 2018 were granted on February 16, 2018.
 
(3)
 
For 2018, each of Messrs. Shoshani, Clancy, and Desilets was granted an annual long-term equity incentive award, 25% of which was in the form of time-vested RSUs, which will vest on January 1, 2021. Each NEOs long-term equity award is further described under the heading “Compensation Discussion and Analysis—Compensation Components, Equity Compensation.”
 
(4)
 
Long-term equity incentive awards, including both time-vested and performance-based RSUs for our NEOs for 2018 were granted on February 16, 2018, and their aggregate grant date fair value was computed in accordance with FASB ASC Topic 718 and based on a stock price of $25.55 (the closing price of our Common Stock on February 16, 2018).




 


31




Outstanding Equity Awards at Fiscal Year End
The following table provides information regarding unvested stock awards and equity incentive plan awards held by our NEOs and outstanding as of December 31, 2018.
 
 
 
 
Stock Awards
 
 
 
 
 
Number of
 
 
 
 
 
 
 
 
Shares or
 
Market Value of
 
 
 
 
 
Units of
 
Shares or Units
 
 
 
 
 
Stock That
 
of Stock That
 
 
 
 
 
Have Not
 
Have Not Vested
 
Name
 
Grant Date
 
Vested (#)
 
($) (4)
 
Ziv Shoshani
 
1/19/2016
 
61,998
(1)
 
1,874,200
 
 
 
2/9/2017
 
38,633
(2)
 
1,167,876
 
 
 
2/16/2018
 
36,209
(3)
 
1,094,598
 
 
 
 
 
 
 
 
 
 
William M. Clancy
 
1/19/2016
 
19,363
(1)
 
585,343
 
 
 
2/9/2017
 
11,930
(2)
 
360,644
 
 
 
2/16/2018
 
10,367
(3)
 
313,394
 
 
 
 
 
 
 
 
 
 
Roland B. Desilets
 
1/19/2016
 
5,437
(1)
 
164,361
 
 
 
2/9/2017
 
3,350
(2)
 
101,271
 
 
 
2/16/2018
 
5,590
(3)
 
168,986
 
____________________
(1)
 
Represents annual equity incentive awards, 25% of which are in the form of time-vested RSUs which vest on January 1, 2019, subject to continued service through such date, and 75% of which are in the form of PBRSUs which vest on January 1, 2019, but only to the extent that the given performance metric is achieved and subject to continued service through such date. The number of PBRSUs presented assumes that the performance metric has been satisfied at the “maximum” level, which is 100% of target.
(2)
 
Represents annual equity incentive awards, 25% of which are in the form of time-vested RSUs which vest on January 1, 2020, subject to continued service through such date, and 75% of which are in the form of PBRSUs which vest on January 1, 2020, but only to the extent that the given performance metric is achieved and subject to continued service through such date. The number of PBRSUs presented assumes that the performance metric has been satisfied at the “maximum” level, which is 100% of target.
(3)
 
Represents annual equity incentive awards, 25% of which are in the form of time-vested RSUs which vest on January 1, 2021, subject to continued service through such date, and 75% of which are in the form of PBRSUs which vest on January 1, 2021, but only to the extent that the given performance metric is achieved and subject to continued service through such date. The number of PBRSUs presented assumes that the performance metric has been satisfied at the “maximum” level, which is 100% of target.
(4)
 
The market value is based on the closing price of our common stock on December 31, 2018, which was $30.23.


32




Option Exercises and Stock Vested
The following table provides information with regard to amounts paid to or received by our NEOs during 2018 as a result of the vesting of RSUs that were granted to the NEOs as part of their compensation agreements.
 
 
Stock Awards
 
 
Number of
 
 
 
 
 
 
Shares
 
 
Value
 
 
Acquired on
 
 
Realized on
Name
 
Vesting (#)
 
 
Vesting
(a)
 
(d)
 
 
(e)
Ziv Shoshani
 
5,023
(1)
 
$
126,328
 
 
13,762
(2)
 
$
431,439
 
 
 
 
 
 
 
William M. Clancy
 
2,047
(1)
 
$
51,482
 
 
5,170
(2)
 
$
162,080
____________________
(1)
 
Represents a portion of annual equity incentive awards comprised of time-vested RSUs granted to each of our NEOs in 2015. These RSUs vested on January 1, 2018.
(2)
 
Represents a portion of annual equity incentive awards comprised of performance-based RSUs granted to each of our NEOs in 2015. These PBRSUs vested on March 13, 2018.
Pension Benefits
Prior to the spin-off, our pension benefits were administered by Vishay Intertechnology. Beginning in January 2010, we began adopting independent pension benefit plans with substantially similar terms as those maintained by Vishay Intertechnology at the time of the spin-off to ensure continuity of benefits for those Vishay Intertechnology employees who became VPG employees at the spin-off. A description of legacy Vishay Intertechnology plans and the new plans that we adopted in their place follows.
In the United States, Vishay Intertechnology maintained a non-qualified pension plan which provided defined benefits to U.S. employees whose participation in the qualified pension plan could jeopardize the qualification of such plan under the Internal Revenue Code. The plan was contributory and, other than its non-qualified status under ERISA, provided substantially the same benefits that were available under Vishay Intertechnology’s qualified retirement plan. Employees with five or more years of service were entitled to annual pension benefits beginning at normal retirement age on the first day of the month following the participant’s 65th birthday equal to the sum of 2.1% of the first $10,000 of earnings plus 2.64% of the annual earnings in excess of $10,000 with a new pension unit earned each year. The final pension was the sum of all units earned during the employee’s career. The plan permitted early retirement if the participant was at least age 55 and had at least five years of service. Employees could elect to receive their pension benefits in the form of a joint and survivor annuity or other contingent annuities. Employees were 100% vested immediately in their contributions. If employees terminated before rendering five years of service, they forfeited the right to receive the portion of their accumulated plan benefits attributable to the Company's contributions. Employees received the value of their accumulated benefits as a life annuity payable monthly from retirement. For each employee electing a life annuity, payments would not be less than the greater of (a) the employee’s accumulated contributions plus interest or (b) an annuity for five years. In connection with the spin-off, VPG adopted the VPG Non-Qualified Retirement Plan, which provides for substantially similar benefits to those provided by its Vishay Intertechnology counterpart at the time of the spin-off. Like the Vishay Non-Qualified Retirement Plan at the time of the spin-off, the VPG Non-Qualified Retirement Plan is frozen with respect to participation and accrual of benefits.

33




The following table provides information regarding the present value of benefits accrued under these retirement benefit plans and arrangements for our NEOs:
 
 
 
 
Number
 
Present Value
 
 
 
 
 
 
 
of Years
 
of
 
 
 
 
 
 
 
Credited
 
Accumulated
 
Payments During
Name
 
Plan Name
 
Service
 
Benefit (1)
 
Last Fiscal Year
(a)
 
 (b)
 
(#)(c)
 
($)(d)
 
($)(e)
Ziv Shoshani
 
Individual contractual postemployment medical arrangement (2)
 
n/a
 
$
143,493
 
$
-
 
 
 
 
 
 
 
 
 
 
 
William M. Clancy
 
VPG Non-qualified Retirement Plan (3)
 
18
 
$
414,228
 
$
-
____________________
(1)
 
These amounts have been calculated using interest rate, mortality, and other actuarial assumptions consistent with those used for financial reporting purposes set forth in Note 9 to VPG’s consolidated financial statements included in our 2018 Annual Report on Form 10-K.
(2)
 
Pursuant to Mr. Shoshani’s employment agreement, if his employment ceases on or after his attainment of age 62 (other than for cause), the Company agreed to pay healthcare premiums to cover, for their respective lifetimes, Mr. Shoshani and his spouse and his children until the age 26 up to an aggregate amount of $15,000 annually. The amount set forth in the table above represents the present value of this benefit.
(3)
 
Mr. Clancy elected to begin participating in the Vishay Non-Qualified Retirement Plan effective January 1, 2000 and subsequently transferred to the VPG Non-Qualified Retirement Plan effective January 1, 2010. The Vishay Non-Qualified Retirement Plan was frozen effective December 31, 2008, such that participants accrue no additional benefits. The VPG Non-Qualified Retirement Plan is similarly frozen. Mr. Clancy is eligible for early retirement under the VPG Non-Qualified Retirement Plan.
Non-Qualified Deferred Compensation
Two of the NEOs participate in the VPG KEWAP (a non-qualified deferred compensation plan), which is available to all employees who meet certain criteria under the Internal Revenue Code. In addition to being eligible to participate in the VPG KEWAP, Mr. Clancy is entitled to receive Company contributions to his VPG KEWAP account associated with his participation in the VPG 401(k) plan. The NEOs are also eligible to elect to defer additional amounts of compensation, subject to certain limitations.
While deferred, amounts are credited with “earnings” based on the performance of notional investment options available under the plan. No portion of the earnings credited during 2018 was “above market” or “preferential.”
The following table sets forth information relating to the activity in the non-qualified deferred compensation plan accounts of the NEOs during 2018 and the aggregate balance of the accounts as of December 31, 2018:
 
 
Executive
 
Registrant
 
Aggregate
 
 
 
 
Aggregate
 
 
Contributions
 
Contributions
 
Earnings in
 
Aggregate
 
Balance at
 
 
in Last Fiscal
 
in Last Fiscal
 
Last Fiscal
 
Withdrawals/
 
Last Fiscal
Name
 
Year
 
Year (1)
 
Year
 
Distributions
 
Year End
(a)
 
($)(b)
 
($)(c)
 
($)(d)
 
($)(e)
 
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