UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form

10-K/A

Amendment No. 1

☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2019

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

COMMISSION FILE NUMBER:

033-80475

GRAPHIC PACKAGING INTERNATIONAL, LLC

(Exact name of registrant as specified in its charter)


Delaware		84-0772929
(State of incorporation) 1500 Riveredge Parkway, Suite 100, Atlanta, Georgia		(I.R.S. employer identification no.) 30328
(Address of principal executive offices)		(Zip Code)

(770)

240-7200

Registrant’s telephone number, including area code:

Securities registered pursuant to Section 12(b) of the Act:

None

Securities registered pursuant to Section 12(g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation

S-T

during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation

S-K

is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form

10-K

or any amendment to this Form

10-K.

☒

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a

non-accelerated

filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule

12b-2

of the Exchange Act. (Check one):


Large accelerated filer	☐	Accelerated filer ☐	Smaller reporting company	☐

Non-accelerated filer	☒		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule

12b-2

of the Act). Yes ☐ No ☒

No voting or

non-voting

common equity of the registrant was held by

non-affiliates

of the registrant as of July 30, 2019.

Explanatory Note

The purpose of this Amendment No. 1 on Form

10-K/A

to Graphic Packaging International, LLC’s Annual Report on Form

10-K

for the year ended December 31, 2019, filed with the Securities and Exchange Commission (the “SEC”) on February 10, 2020 (the “Form

10-K”)

is to provide the information required by Items

10-14

in Part III of such Form

10-K.

No other changes have been made to any of the disclosures in the Form

10-K.

As required by Rule

12b-15

under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), currently-dated certifications from the Company’s Chief Executive Officer and Chief Financial Officer have been included as exhibits to this Amendment No. 1.

TABLE OF CONTENTS OF FORM

10-K/A


	PART III

ITEM 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE	4

ITEM 11.	EXECUTIVE COMPENSATION	4

ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	28

ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE	28

ITEM 14.	PRINCIPAL ACCOUNTANT FEES AND SERVICES	28

	PART IV

ITEM 15.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULES	30

SIGNATURES		31

PART III

ITEM 10.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE

GOVERNANCE

Graphic Packaging International, LLC (the “Company”) is a Delaware limited liability company that is managed by its sole member, Graphic Packaging International Partners, LLC, a Delaware limited liability company (“GPIP” or the “Member”). As a limited liability company managed by its sole Member, the Company does not have a board of directors. Pursuant to the Amended and Restated Limited Liability Company Operating Agreement of the Company, GPIP has the right and power to appoint individuals to serve as officers of the Company and to delegate authority to such officers to manage the business, affairs and properties of the Company.

The Member has appointed officers of the Company and designated certain of such officers as “Executive Officers.” The Executive Officers are listed as an unnumbered item in Part I of the Company’s Form

10-K.

These Executive Officers are the same as the Executive Officers of the Company’s ultimate, publicly-traded, parent company, Graphic Packaging Holding Company (“GPHC”). There are no family relationships among any of the Executive Officers of the Company.

Section 16(a) Beneficial Ownership Reporting Compliance

The Company does not have equity securities registered pursuant to Section 12 of the Exchange Act, and therefore there are no persons subject to Section 16 of the Exchange Act with respect to the Company that are required to file Forms 3, 4 or 5 with the SEC.

Code of Ethics

The Company has not adopted a separate code of ethics because all of the Company’s employees and are subject to the Code of Business Conduct and Ethics adopted by the Board of Directors of GPHC. A copy of the Code of Business Conduct and Ethics is available on the Company’s website at

www.graphicpkg.com

in the Investors section.

ITEM 11.

EXECUTIVE COMPENSATION

The Executive Officers of the Company are the same as the Executive Officers of its ultimate, publicly-traded parent company, GPHC. Compensation of the Company’s Executive Officers is determined by the Compensation and Management Development Committee of the Board of Directors of GPHC and, in the case of Mr. Doss, the full Board of Directors of GPHC. No Executive Officer of the Company receives additional compensation for serving as an officer of GPHC. As a result, the Company’s principal executive officer (Mr. Michael P. Doss), principal financial officer (Mr. Stephen R. Scherger), the Company’s three other most highly paid executive officers who were serving as executive officers on December 31, 2019 (collectively, the “Named Executive Officers”) are the same as GPHC’s named executive officers for 2019. Accordingly, the Compensation Discussion and Analysis and the tabular and narrative compensation disclosures contained in this Amendment No. 1 to the Company’s Form

10-K/A

are essentially the same as those contained in GPHC’s Definitive Proxy Statement on Schedule 14A filed with the SEC on April 2, 2020.

Because the Compensation and Management Development Committee of GPHC, together with the Board of Directors of GPHC, establishes the compensation of the Company’s Named Executive Officers, the report of the Compensation and Management Development Committee of GPHC is included herein, together with information on compensation committee interlocks and insider participation related to the Management Development Committee of GPHC.

Compensation and Management Development Committee Report

The members of GPHC’s Compensation and Management Development Committee listed below reviewed and discussed the following Compensation Discussion and Analysis with management of the Company. Based on such review and discussion, the Compensation and Management Development Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be incorporated by reference into the Company’s Annual Report on Form

10-K

for the year ended December 31, 2019.

Compensation and Management Development Committee

Robert A. Hagemann, Chairman

Laurie Brlas

David D. Campbell

Dean A. Scarborough

Larry M. Venturelli

Compensation Discussion and Analysis

This Compensation Discussion and Analysis section (“CD&A”) describes GPHC’s compensation principles, policies and practices, as well as the specific factors considered by the Compensation and Management Development Committee (referred to in this CD&A as the “Committee”) in making compensation decisions. This CD&A focuses on the compensation of our Named Executive Officers (referred to herein as our “Executives”), who are set forth below and included in the Summary Compensation Table and other tables herein:


Name		Position with GPHC and the Company at December 31, 2019

Michael P. Doss		President and Chief Executive Officer
Stephen R. Scherger		Executive Vice President and Chief Financial Officer
Stacey J. Valy Panayiotou		Executive Vice President, Human Resources
Lauren S. Tashma		Executive Vice President, General Counsel and Secretary
Joseph P. Yost		Executive Vice President and President, Americas

Executive Summary

Our compensation programs reflect our commitment to pay for performance and align the interests of our key employees with those of GPHC’s stockholders. Executive compensation plans are designed to support GPHC’s and the Company’s annual financial goals and promote GPHC stockholder value creation over the long term. In addition, they are intended to attract, retain, motivate and reward those responsible for leading our business. A significant portion of the compensation packages of our Executives is intended to be

at-risk

pay for performance earned based on specific financial and operational achievements. During 2019, GPHC was successful in:

•

increasing Net Sales and Adjusted EBITDA

by 2.2% and 6.1%, respectively, through higher pricing and improved volume and mix related primarily to acquisitions;

•

completing the integration of the transformative combination with International Paper Company’s North America Consumer Packaging business and achieving synergies of $75 million at year end;

•

completing the acquisition of Artistic Carton Company for $53 million, which is expected to expand

end-market

diversification and increase paperboard integration;

•

introducing Vision 2025, focusing on long-term goals for the Company, including a shift to 100 to 200 basis points of sustainability-supported net organic volume growth;

•

returning $242 million of cash to stakeholders through a combination of share repurchases, distributions and quarterly cash dividends;

•

reducing leverage, thereby providing GPHC with increased financial flexibility in deploying capital to drive stockholder value.

1	A reconciliation of Adjusted EBITDA to Net Income is attached to GPHC’s earnings release for the fourth quarter and full year ended December 31, 2019 furnished as Exhibit 99.1 to the GPHC’s Current Report on Form 8-K filed with the Securities and Exchange Commission on January 28, 2020.

Throughout 2019, our compensation program performed as designed, allowing GPHC to attract new talent, retain important members of management and reward key members of management appropriately for performance. As demonstrated below, the total compensation of our President and CEO for each of the past five years (as set forth in the Summary Compensation Table but excluding changes in pension value and above-market

non-qualified

deferred compensation earnings, “CEO Compensation”) is generally aligned with the performance and value of GPHC as reflected in the price of its common stock at year end. The amount of CEO Compensation shown below reflects the retirement of David W. Scheible as President and CEO and Mr. Doss’ promotion into that role as of January 1, 2016, which reduced CEO Compensation significantly in 2016 and 2017. The drop in GPHC’s stock price in 2018 reflects a period of intense stock market volatility at 2018 year end.

CEO Compensation v. Stock Price Performance

Guiding Principles and Policies

The Committee’s objective is to set each of the primary components of GPHC’s executive compensation program, (base salary, short-term cash incentive and long-term equity-based incentives), at a market-competitive rate, which is determined by reference to the 50th percentile of the relevant peer group (described below), resulting in each Executive’s total compensation opportunity being set at approximately the 50th percentile of the relevant peer group’s total pay for executives with similar positions and responsibilities. The Committee does not employ a mechanical process based on external compensation data, however, as other considerations such as time in position, tenure, position and succession with GPHC are considered. As data for the relevant peer group fluctuates or the peer group members are updated to reflect changes in the market, the Committee may make adjustments in one or more components of compensation to more closely align with market. The Committee and, with respect to the President and CEO, the Board of Directors, have full discretion to choose the elements of executive compensation that the Executives will be paid or will be eligible to earn each year and to adjust the proportion of total compensation opportunity that each element provides. Company performance, market data, individual performance, executive succession, hiring and retention needs and internal equity among our Executives’ compensation packages have been the primary factors considered in decisions to change compensation materially.

Peer Group and Market Data

Annually we obtain an analysis of compensation market data to assist in setting pay opportunities for our Executives for the following year. Compensation of the Executives is compared to the pay opportunities provided to executives holding comparable positions at companies with which we compete for business and for talent. The companies used for this comparison are recommended by GPHC and the Committee’s compensation consultant and approved by the Committee. The companies selected and shown below under the Industry Specific Peer Group heading consist of a group of public companies with revenues approximately

one-third

to three times the revenues of GPHC. The Industry Specific Peer Group had median revenues of approximately $5.9 billion for the twelve months ended March 31, 2018, and a median market cap of approximately $5.8 billion as of June 1, 2018 and served as the primary reference point for comparing the compensation paid to GPHC’s President and CEO and Executive Vice President and Chief Financial Officer. The Survey Peer Group, comprised of a broader set of industrial companies, had median revenues of $6.6 billion for the twelve months ended March 31, 2018, and a median market cap of $10.5 billion as of June 1, 2018, and served as the primary reference point for executive officers other than the President and CEO and Executive Vice President and Chief Financial Officer. Both peer groups are reviewed annually and updated, if necessary, to ensure their appropriateness given any market changes. The companies used to develop 2019 executive compensation are listed below.

Industry Specific Peer Group


AptarGroup, Inc.	Crown Holdings, Inc.	Sealed Air Corporation
Avery Dennison Corporation	Greif, Inc.	Silgan Holdings, Inc.
Ball Corporation	Owens-Illinois Inc.	Sonoco Products Company
Bemis Company, Inc.	Packaging Corporation of America	WestRock Company

Survey Peer Group


Air Products and Chemicals, Inc.	Herman Miller, Inc.	Sonoco Products Company
Armstrong World Industries, Inc.	ITT Corporation	Steelcase, Inc.
Avery Dennison Corporation	Masco Corp.	TechnipFMC plc
Ball Corporation	Molson Coors Brewing Company	The Scott’s Miracle-Gro Company
Borg Warner Inc.	Newell Brands, Inc.	Tupperware Brands Corporation
Dover Corporation	Owens-Illinois Inc.	USG Corporation
Eastman Chemical Company	Packaging Corporation of America	Vulcan Materials Company
Ecolab Inc.	Rockwell Automation, Inc.	WestRock Company
Energizer Holdings, Inc.	Sealed Air Corporation

Role of the Compensation and Management Development Committee

The Committee is responsible for establishing GPHC’s general compensation philosophy and working with management to develop all equity compensation plans or programs and other compensation programs in which the executive officers participate. The Committee works to ensure that GPHC’s practices, policies and programs link pay to performance, encourage an appropriate degree of risk taking, are consistent with GPHC’s talent objectives of attracting, retaining, rewarding and motivating key employees, and align the interests of key employees with those of stakeholders. Annually, the Committee reviews GPHC’s compensation programs and assesses whether any risks arising from such practices, policies and programs are reasonably likely to have a material adverse effect on GPHC. In addition, the Committee annually reviews market data provided by the Committee’s compensation consultant,

reviews and approves all of the compensation arrangements of GPHC’s executive officers, and directs the Board’s process for evaluating the performance and compensation of the President and CEO. From time to time the Committee also reviews, evaluates and approves GPHC’s health and welfare plan offerings and GPHC’s retirement and savings plans to ensure their alignment with the market, effectiveness in attracting and retaining talent and cost effectiveness.

The Committee is also responsible for reviewing GPHC’s integrated talent management processes to assess the success of these programs in facilitating GPHC’s short and long-term objectives. The Committee directs the annual succession planning process for executive officers and facilitates the Board’s review and approval of the President and CEO’s succession plan. The Committee also annually reviews compliance with executive shareholding requirements and monitors any application of GPHC’s clawback policy.

Role of Compensation Consultants

The Committee retained Meridian to act as the Committee’s independent advisor on executive compensation and benefits throughout 2019. The mandate of the compensation consultant is to work for the Committee in its review of executive compensation practices and programs, including assessing the overall competitiveness of pay levels and program design, and providing updates on market trends and technical considerations. The Committee instructed the compensation consultant to compile and provide data on both total pay and individual elements of compensation among companies in the peer groups, as well as trends in compensation practices that they observed within the peer groups and generally among public companies. The Committee does not rely on the compensation consultant to recommend specific levels of total pay or any specific element of compensation to our Executives; such recommendations are developed by management based on information provided by the compensation consultant and then presented to the Committee for consideration. The compensation consultant attended all of the six Committee meetings in 2019 at the Committee’s request and were available to provide information to the Committee as questions and issues arose.

The Committee completes an assessment of the compensation consultant annually. The Committee determined that the compensation consultant is independent after consideration of the SEC’s independence factors.

Role of Executive Officers

The President and CEO and Executive Vice President, Human Resources recommend to the Committee the base salary and short- and long-term award amounts for the Executives (other than themselves). The Committee works with the compensation consultant to propose the compensation design and award amounts for the President and CEO.

Pay and Performance

As noted above, target compensation for each of our Executives is established at the beginning of each year with reference to the 50th percentile of the relevant peer group. Each Executive’s actual compensation each year may be above or below the target level based on individual, business unit and overall Company performance, as well as changes in the price of GPHC’s common stock. The chart below illustrates the relationship between CEO Compensation and GPHC’s Adjusted EBITDA, and also reflects the retirement of David Scheible as President and CEO and Mr. Doss’ promotion into that role as of January 1, 2016, which reduced CEO Compensation significantly in 2016 and 2017. The Company calculates Adjusted EBITDA for purposes of its incentive plans as consolidated net income before equity income of unconsolidated subsidiaries, interest expense, income tax expense, and depreciation and amortization, as adjusted for: expenses related to merger, acquisition and disposition activities; refinancing or early retirement of debt; acquisition integration costs; and asset or goodwill write-downs; as well as other adjustments for restructuring or reorganization activities; all as approved by the Compensation and Management Development Committee (“Adjusted EBITDA”). Adjusted EBITDA is used by GPHC as a performance measure for both the short-term cash incentive program and the long-term equity incentive program.

CEO Compensation v. Adjusted EBITDA Performance*

Key Compensation Practices

Below are certain of GPHC’s executive compensation practices that we believe are instrumental in achieving GPHC’s compensation goals of attracting, retaining, motivating and rewarding key members of management, while mitigating risk and maintaining sound compensation practices.


What we do:		What we don’t do:
✓ Maintain a compensation mix that encourages employees to focus on achieving Company-wide profitability and strategic goals over both the short and long term ✓ Structure the majority of compensation paid to Executives as performance-based compensation ✓ Annually benchmark compensation with reference to the 50th percentile of peer group companies with which we may compete for talent ✓ Establish payout caps on short-term and long-term incentive compensation awards ✓ Retain an independent compensation consultant that is engaged by and reports directly to the Committee ✓ Subject short-term and long-term incentive compensation awards to clawback in the event of misconduct resulting in a restatement ✓ Require executive officers and members of the Board to maintain minimum equity ownership levels ✓ Review GPHC’s compensation plans and practices annually to ensure that they do not encourage excessive risk taking		× Permit hedging, pledging or short-sale transactions by our employees or members of our Board of Directors × Pay dividends on unvested equity-based incentive awards × Pay tax gross ups on change of control severance benefits × Provide excessive perquisites to our Executives

Overview of Executive Compensation Components

The Committee evaluates the alignment between compensation philosophy, plan design and achievement of short- and long-term results to determine the components of our Executives’ compensation program. We structure the majority of compensation to Executives as performance-based compensation. Our 2019 executive compensation program consisted of the following compensation elements:

•

Base salary;

•

Short-term cash incentive;

•

Long-term incentives, consisting of service-based restricted stock units (“Service RSUs”) and performance-based restricted stock units (“Performance RSUs”);

•

Health and welfare benefits, including executive physicals;

•

Retirement benefits; and

•

Termination pay.

Each of these elements is discussed below, as well as the methodology used for setting the amount of each type of compensation.

Base Salary

The purpose of base salaries is to compensate our Executives for their role and level of responsibility within GPHC and our philosophy is to set salaries for our Executives at approximately the 50

percentile of the relevant peer group’s salaries for executives with similar positions and responsibilities. Increases in base salary also serve to reward performance and recognize significant increases in the scope of an Executive’s position and responsibilities. Changes to base salaries occur in connection with changes in position and on a periodic basis that is generally twelve months

after the most recent adjustment for the Executive. Base salary changes take into account market data for similar positions, the Executive’s experience and time in position, any changes in responsibilities and individual performance. Individual performance is determined by considering achievement against each Executive’s specific performance goals established at the beginning of each year. Generally, such individual performance goals are established to support the financial and operational goals established by the Board for GPHC, and may include earnings before income taxes, depreciation, amortization and other

non-cash

charges, debt reduction, new product innovation targets, business unit revenue, profitability and cost-saving goals and certain more subjective goals such as talent development, cultural initiatives, compliance and management effectiveness.

In 2019, the Committee approved base salary increases for the Executives ranging from 2.9% to 17.0%, with Mr. Doss receiving an increase of 2.9%. Such increases were based upon each Executive’s performance, scope of position and market data for executives with similar positions and responsibilities. Such increases became effective as of January 1, 2019.

Short-Term Cash Incentive

The Company provides a short-term cash incentive opportunity under the Management Incentive Plan (“MIP”). The purpose of the MIP is to provide a meaningful short-term cash incentive that rewards the achievement of specified annual financial goals. For 2019, the financial measures used to set such financial goals or targets were Adjusted EBITDA and Cash Flow Before Debt Reduction. The Committee chose these financial metrics because they are well understood, objective targets and have a direct link to GPHC’s business plan. GPHC calculates Cash Flow Before Debt Reduction as the year-over-year change in net debt, as adjusted for merger, acquisition, disposition, share repurchase, dividend and capital market activities, as well as other adjustments for restructuring or reorganization activities and other unusual items, all as specifically approved by the Compensation and Management Development Committee.

Target Opportunities.

We set the MIP target percentage for each Executive at approximately the 50th percentile of relevant peer group companies. Adjustments to MIP target levels are made periodically, taking into consideration the relevant peer group, the CEO’s recommendations (for Executives other than himself) and input from the compensation consultant. The annual incentive target (as a percentage of base salary) for each of the Executives for 2019 is set forth below:


Name	Incentive Target
Michael P. Doss		120	%
Stephen R. Scherger		80	%
Stacey J. Valy Panayiotou		65	%
Lauren S. Tashma		65	%
Joseph P. Yost		75	%

Performance Goals.

We set performance goals for the MIP so that achievement of such goals at target supports our annual operating plan. The degree to which MIP pays out varies both up and down based on business performance as reflected in the following chart.

2019 MIP Performance Goals


Adjusted EBITDA (Weighted 50%)			Cash Flow Before Debt Reduction (Weighted 50%)
Performance		Payout	Performance		Payout
<90% of Target	$896.0 Million	0%	<85% of Target	$421.0 Million	0%
95% of Target	$945.0 Million	50%	92.5% of Target	$458.0 Million	50%
Target	$995.0 Million	100%	Target	$495.0 Million	100%
105% of Target	$1,045.0 Million	150%	107.5% of Target	$532.0 Million	150%
110% of Target	$1,095.0 Million	200%	115% of Target	$569.0 Million	200%

Actual Short-Term Cash Incentive Payouts for 2019.

Actual short-term cash incentive payouts for 2019 for the Executives are shown in the

Non-Equity

Incentive Plan Compensation column of the Summary Compensation Table. The Company’s performance with respect to its Adjusted EBITDA and Cash Flow Before Debt Reduction performance goals, were achieved at 103.6% and 110.1% of target, respectively, resulting in a calculated MIP payout at 151.9% of target. After applying available discretion, management recommended and the Committee and Board of Directors approved a slightly reduced payout at 150% of target.

For more information on the 2019 annual incentive opportunities for the Executives, refer to the “Grants of Plan-Based Awards” table below. The column titled “Estimated Possible Payouts Under

Non-Equity

Incentive Plan Awards” provides the estimated payouts for the Executives at threshold, target and maximum performance levels for 2019.

Long-Term Incentives

The Company grants long-term incentive compensation to reward performance over the longer term and align the interests of employees with the interests of stockholders. The Company’s long-term incentive program has two elements: Service RSUs and Performance RSUs. Service RSUs make up

one-third

of the total long-term incentive value that GPHC grants to its Executives and Performance RSUs make up

two-thirds

of such total value. A greater proportion of Performance RSUs is consistent with GPHC’s desire to tie a larger percentage of the Executives’ compensation to Company performance. Both Service RSU and Performance RSU grants are intended to retain Executives during a multi-year vesting period and promote equity ownership.

Service RSUs represent the right to receive one share of GPHC’s common stock for each vested Service RSU granted. The Performance RSUs represent the right to earn from 0% to 200% of the target award based upon GPHC’s achievement of specific performance goals established for a three-year performance period. Service RSUs and Performance RSUs are payable solely in shares of GPHC’s common stock.

Service RSUs and Performance RSUs granted under the long-term incentive program generally vest in full on the third anniversary of the date of grant (assuming the Executive has continued in his or her employment by GPHC through such date). Upon death, disability, retirement (as defined in the grant agreement) or involuntary termination without cause, a proportion of the RSUs vests. In the event of a change of control (as defined in the Graphic Packaging Holding Company 2014 Omnibus Stock and Incentive Compensation Plan (the “2014 Plan”)), all Service RSUs and earned Performance RSUs vest in full. The number of Performance RSUs considered earned in the event of a change of control is determined based on assumed target performance for the performance period.

Payout of 2016 Grants.

In January 2019, the Committee approved the payout of the Performance RSUs granted in 2016 at 41.0% of target, based on the achievement of the performance goals for the three-year performance period shown below.

2016 Long-Term Incentive Program Performance Goals


3-Year Aggregate Adjusted EBITDA (Weighted 50%)			3-Year Average Return on Invested Capital (Weighted 50%)
Performance		Payout	Performance		Payout
<90% of Target	$2,241.0 Million	0%	<95% of Target	12.16%	0%
95% of Target	$2,366.0 Million	50%	97.5% of Target	12.48%	50%
Target	$2,490.0 Million	100%	Target	12.80%	100%
105% of Target	$2,615.0 Million	150%	102.5% of Target	13.12%	150%
110% of Target	$2,739.0 Million	200%	105% of Target	13.44%	200%

The Company achieved Adjusted EBITDA of $2,447.1 million (98.3% of target) resulting in a payout of this component at 82.8% and Return on Invested Capital of 12.05% (94.1% of target) resulting in a payout of this component at 0% and a combined payout at 41% of target.

2019 Grants.

In February 2019, GPHC granted both Service RSUs and Performance RSUs to each Executive, under the long-term incentive program. For Executives, the total number of RSUs granted was set based on a value delivered as a

percentage-of-salary

formula, with the percentage established based on a review of responsibilities, market data and internal equity considerations. The value determined by the percentage of salary was then converted to the total number of RSUs by dividing the value by the average stock price of GPHC’s common stock during January 2019.

One-third

of the total number of RSUs was granted as Service RSUs and

two-thirds

was granted as Performance RSUs. The target value of RSUs granted under the long-term incentive program (as a percentage of salary) during 2019 for each of our Executives is set forth below:


Michael P. Doss	480	%
Stephen R. Scherger	215	%
Stacey J. Valy Panayiotou(1)	155	%
Lauren S. Tashma	155	%
Joseph P. Yost	185	%

(1)

Ms. Panayiotou joined the Company on April 22, 2019. Ms. Panayiotou received a new hire grant of Service RSUs on May 1, 2019 to compensate her for equity forfeited at her former employer, as well as a grant of both Service RSUs and Performance RSUs equivalent to what she would have received under the long-term incentive program and the

percentage-of-salary

target set forth above.

For the Performance RSUs granted in 2019, the performance goals are achievement of a preset aggregate Adjusted EBITDA amount and a preset return on invested capital percentage

The Adjusted EBITDA goal is weighted in the calculation of GPHC’s annual achievement at 60% and the return on invested capital percentage goal is weighted in the calculating GPHC’s annual achievement at 40%. The Committee weighted the Adjusted EBITDA goal slightly more than the return on invested capital goal to reflect the priority placed on meeting earnings commitments. Total payout is also subject to a relative total stockholder return (“TSR”) modifier, which can modify payouts earned up or down by up to 20% (subject to the 200% of target cap). This payout modifier was added to measure GPHC’s stock performance against other similar companies and to more closely align management and stockholders’ interests.

Health and Welfare Benefit Plans

The Company provides the Executives and other employees with health and welfare benefits comparable to those they would receive at other companies and that are necessary for GPHC to remain competitive in the marketplace for high-performing talent. Executives participate in employee benefit plans available to all salaried employees, including medical, dental, vision, accidental death and dismemberment, business travel accident, prescription drug, life and disability insurance. Senior executives of GPHC, including the Executives, are eligible for an executive physical benefit in which GPHC pays for an annual physical exam through a specified provider under GPHC’s medical plan. Continuation of health and welfare benefits for a limited time may occur as part of severance upon certain terminations of employment.

Perquisites

The Company generally does not provide significant perquisites to its Executives, other than Company-requested international assignment and relocation benefits (and tax

gross-ups

with respect thereto) and executive physicals.

Retirement Benefits

The Company maintains qualified defined benefit and defined contribution retirement plans for our employees in which certain of the Executives participate. These plans provide retirement benefits to retain eligible employees and Executives and encourage and reward tenure with GPHC. In addition to the qualified defined benefit and defined contribution plans, GPHC maintains

non-qualified

defined benefit and defined contribution plans in which certain of the Executives also participate. The qualified benefit plans have a maximum compensation limit and a maximum annual benefit limit, which restrict the benefit to participants whose compensation exceeds these limits. To provide retirement benefits commensurate with pay levels, the

non-qualified

plans provide benefits to key salaried employees, including the Executives, using substantially the same formula for calculating benefits as used in the qualified plans, but on compensation in excess of the compensation limitation and maximum annual benefit.

Qualified and

Non-Qualified

Defined Benefit Plans.

Executives and other employees hired before January 1, 2008, participate in either the Riverwood International Employees Retirement Plan or the Graphic Packaging Retirement Plan and the Graphic Packaging Excess Benefit Plan (together, the “Pension Plans”). As of June 30, 2011, GPHC froze the Pension Plans and no longer makes pension contributions for future service on behalf of any employees who were not at least 50 years old with five years of completed service to GPHC as of such date. As a result, GPHC no longer makes pension contributions on behalf of any of the Executives, although Messrs. Doss and Yost have frozen benefits thereunder.

The Executives who participate in the Pension Plans also participate in either the Riverwood International Supplemental Retirement Plan or the Graphic Packaging Supplemental Retirement Plan (together, the “Supplemental Plans”). Mr. Doss participated in the Graphic Packaging Retirement Plan and the Graphic Packaging Supplemental Plan until January 1, 2005, the date he transferred into the Riverwood International Employees Retirement Plan and the Riverwood International Supplemental Retirement Plan. The Supplemental Plans provide a benefit based upon compensation that exceeds the limits set by the IRS for the Pension Plans and makes total retirement benefits under GPHC’s defined benefit plans for the Executives commensurate with those available to other employees as a percent of pay. When GPHC froze the Pension Plans, it also froze the Supplemental Plans for those employees who were not at least 50 years old with five years of completed service to GPHC as of such date, so GPHC no longer makes contributions to the Supplemental Plans on behalf of any of the Executives, although Messrs. Doss and Yost have frozen benefits thereunder.

Effective January 1, 2017, the Riverwood International Employees Retirement Plan and the Graphic Packaging Retirement Plan were merged into the GPI U.S. Consolidated Pension Plan. Benefits are calculated under the terms of the original plans, which function as subplans under the GPI U.S. Consolidated Pension Plan. In December 2019, in connection with the settlement of liabilities under the GPI U.S. Consolidated Pension Plan, Mr. Doss and Mr. Yost received lump sum payouts of $363,244 and $249,149, respectively.

Qualified and

Non-Qualified

Defined Contribution Plans

. Executives and all other

non-union

employees who meet certain service requirements are eligible to participate in the Graphic Packaging International, LLC Savings Plan (the “401(k) Plan”), which is a qualified defined contribution plan under the rules of the IRS. Employees who choose to contribute to the 401(k) Plan receive matching contributions from GPHC equal to 100% of the first four percent (4%) of employee contributions and 50% of the next three percent (3%) of employee contributions. Employees hired on or after January 1, 2008 are eligible for an annual supplemental contribution by GPHC to their 401(k) Plan account equal to 3% of eligible earnings.

In 2011, GPHC implemented a deferred compensation and 401(k) restoration plan that permits Executives and other eligible senior employees to contribute to and receive contributions from GPHC on a basis that would be commensurate with other employees as a percent of pay. This plan, the Graphic Packaging International, LLC

Non-Qualified

Deferred Compensation Plan (the “NQDCP”), permits participants to defer and contribute from 1% to 50% of their base salary and up to 100% of their payment under the MIP to the plan. The plan offers investment options that generally mirror those available under GPHC’s 401(k) Plan. Annually, GPHC makes a 401(k) restoration matching contribution on behalf of those participants who do not participate in or receive future service accruals under GPHC’s Pension Plans equal to a percentage of their annual deferral amount divided by compensation over the annual IRS limit, up to a maximum of 5.5%. The Company also makes a supplemental contribution equal to 3% of eligible pay over the annual IRS limit for those Executives and senior executives of GPHC who do not participate in or receive future service accruals to one of GPHC’s Pension Plans or Supplemental Plans and who have met the one year of service eligibility requirement. The NQDCP also provides an employer contribution equal to 3% of total pay for eligible senior executives (including all of the Executives) who do not receive contributions to one of GPHC’s Pension Plans.

Employment Agreements and Potential Payments on Termination

Executive officers serving prior to January 2014 (Messrs. Doss, Scherger, and Yost) have employment agreements with generally uniform provisions, including

non-competition

and

non-solicitation

covenants as well as claims releases and severance provisions. The employment agreements specify position, base salary and aggregate annual bonus opportunity (as a percentage of base salary) for each Executive at the time the Agreement was entered into, as well as severance arrangements under different circumstances. Executives may receive severance benefits if they are terminated involuntarily or terminate voluntarily for Good Reason (as defined below) within 30 days of the Good Reason event. The Executive must deliver written notice of intention to terminate for Good Reason, specifying the applicable provision, and provide GPHC a reasonable opportunity to cure. The Good Reason provision in the agreements was designed to equalize the treatment of voluntary terminations for Good Reason with involuntary terminations without cause. Doing so enables the contracts to fulfill their purpose of promoting retention during times of uncertainty and transition. “Good Reason” as defined in the agreements includes material reduction in position, responsibilities or duties, failure by GPHC to obtain the assumption of the agreement by a successor company, reduction in base salary (unless the reduction does not exceed 10% and is applied uniformly to all similarly situated executives), breach of agreement or mandatory relocation (other than in connection with promotion) of more than 50 miles.

For Mr. Doss, the severance benefit is an amount equal to one year’s base salary, his target bonus for the year in which termination occurs and his actual bonus based on the plan targets, prorated for the number of days Mr. Doss is employed during the year in which termination occurs. For Messrs. Scherger and Yost, the severance benefit is one times base salary. Executives also receive health and welfare benefits for one year after termination and a

pro-rata

bonus payout. Mr. Doss also vests in any unvested equity awards on the date of his termination as if he were retirement eligible (daily

pro-rata

vesting) without regard to his actual age or years of service on the date of termination. In addition, if an Executive is separated from service without cause or for Good Reason within one year of a change in control, the Executive receives (i) an additional 1/2 year of base salary (one year for Mr. Doss) and (ii) instead of the

pro-rata

bonus, a bonus equal to the Executive’s target level bonus for the year in which the separation occurs (assuming that all performance targets had been achieved) multiplied by 1.5 (multiplied by 2 for Mr. Doss). All benefit payments under the employment agreements are conditioned upon the Executive executing and returning a claims release to GPHC.

Executives who do not have employment agreements are eligible to participate in the Graphic Packaging International, LLC Executive Severance Plan. Similar to the provisions in the employment agreements, the Executive Severance Plan provides severance benefits equal to one year’s base salary and a

pro-rata

bonus if the Executive is terminated involuntarily without cause or terminates his or her employment for Good Reason. If such a termination occurs within one year after a change in control, Executives receive an additional

one-half

year’s base salary and an amount equal to his or her bonus at target level as if he or she had been employed for the entire year multiplied by 1.5. Payments under the Executive Severance Plan are conditioned upon the participant executing a release that includes a general release of claims against GPHC and an agreement to certain confidentiality,

non-competition

and

non-solicitation

of employee and customer provisions.

In addition to the change in control provisions in the employment agreements and the Executive Severance Plan, the award agreements for Service RSUs and Performance RSUs provide for accelerated vesting and payout in the event of a change in control. A

“change-in-control”

means any of the following events:

•

The acquisition by any person of beneficial ownership of thirty percent (30%) or more of the combined voting power or outstanding shares of common stock of GPHC entitled to vote generally in the election of directors, except if such acquisition is by a person who, prior to such acquisition, is the beneficial owner of thirty percent (30%) or more of such securities, or if such acquisition is by any employee benefit plan or related trust;

•

Individuals of the incumbent Board of GPHC (other than those whose initial assumption of office is in connection with an actual or threatened election contest relating to the election or removal of directors of GPHC) do not constitute at least a majority of the Board;

•

Consummation of a reorganization, merger or consolidation to which GPHC is a party unless (i) all or substantially all of the individuals and entities who were the Beneficial Owners of GPHC’s outstanding securities prior to such transaction beneficially own more than fifty percent (50%) of the combined voting power of the outstanding voting securities entitled to vote generally in the election of directors of the corporation resulting from the transaction, and (ii) no person (excluding successors to current stockholders or any employee benefit plan or related trust) beneficially owns thirty percent (30%) or more of the combined voting power of the then outstanding voting securities,

except to the extent that such ownership existed prior to the transaction, and (iii) at least a majority of the members of the board of directors of the resulting entity were members of the incumbent Board at the time of the execution of the initial agreement or of the action of the Board providing such reorganization, merger or consolidation;

•

The sale, transfer or disposition of all or substantially all of the assets of GPHC; or

•

The approval by the stockholders of GPHC of a complete liquidation or dissolution of GPHC.

The forgoing events were chosen to trigger the vesting and payout of RSUs because they constitute a fundamental change in the ownership or control of GPHC, which materially alters the prospects and future of GPHC and the Company and, therefore, the employment conditions and opportunities for the members of management who receive RSUs.

Policies Applicable to Executive Officers

Clawback Provisions

The Company has clawback provisions in the MIP and long-term incentive plan grant agreements that call for the recoupment of any short-term incentive compensation under the MIP or any equity-based award given to a current or former employee in the event of a restatement of GPHC’s reported financial results. If GPHC is required to prepare an accounting restatement due to the

material non-compliance of

GPHC, as a result of misconduct, with any financial reporting requirement under the securities laws and the employee (i) is determined by the Committee to have knowingly or grossly negligently engaged in misconduct, or knowingly or grossly failed to prevent misconduct, or (ii) if the employee is one of the individuals subject to automatic forfeiture under Section 304 of the Sarbanes-Oxley Act of 2002 or any other regulation, the employee must reimburse GPHC the amount of any payment in settlement of any award earned or accrued during the twelve month period following the filing of

the non-compliant financial

document.

Stock Ownership Guidelines

GPHC has adopted stock ownership guidelines that apply to the

non-management

members of GPHC’s Board of Directors and our executive officers (including the Executives). The guidelines require such persons to maintain ownership of GPHC’s common stock having a value equal or greater than:

•

3x the annual cash retainer paid to the

non-management

members of the Board of Directors

•

5x the base salary paid to the President and CEO

•

3x the base salary for the Executive Vice Presidents

Shares owned by a Director or executive officer and unvested Service RSUs count toward satisfaction of the stock ownership guidelines. Unvested Performance RSUs do not count toward satisfaction of the stock ownership guidelines. GPHC Directors and executive officers are expected to achieve their applicable ownership levels within five years of becoming subject to the guidelines. All of GPHC’s

non-management

Directors and Executives are in compliance with the guidelines.

Hedging and Pledging Policy

GPHC’s Hedging and Pledging Policy is contained in its Policy on Trading in Securities of Graphic Packaging Holding Company. Such policy prohibits any director, officer, employee or agent of the Company or its subsidiaries, including their immediate family members and others in their households (each a “Company Associate”) from entering into short sales, publicly-traded options and hedging transactions such as zero cost collars and forward sale contracts that allow the Company Associate to lock in much of the value of his or her securities holdings or continue securities ownership without the full risks and rewards of such ownership. In addition, Company Associates are prohibited from pledging our securities, including through holding our securities in margin accounts or pledging our securities as collateral for a loan.

Timing of Compensation

Base salary adjustments, annual incentive payments and annual RSU grants are generally approved at the first or second Committee meeting and first GPHC Board meeting of the year. Our policy is that for awards of equity compensation, the date of grant is no earlier than the date upon which the grant is approved by the Committee or the GPHC Board, as appropriate.

Consideration of Most Recent Advisory Stockholder Vote on Executive Compensation

At the Annual Meeting of GPHC Stockholders on May 22, 2019, 94.5% of the shares represented and entitled to vote at the Annual Meeting were voted to approve the compensation of GPHC’s Named Executive Officers, as discussed and disclosed in the GPHC 2019 Proxy Statement. In considering the results of this advisory vote on executive compensation, the Committee concluded that the compensation paid to our Named Executive Officers and GPHC’s overall pay practices enjoy strong stockholder support. Going forward, future advisory votes on executive compensation will serve as an additional tool to guide the GPHC Board and the Committee in evaluating the alignment of GPHC’s executive compensation program with the interests of GPHC and its stockholders.

At the Annual Meeting of GPHC Stockholders on May 24, 2017, GPHC stockholders expressed a preference that advisory votes on executive compensation occur every year. Consistent with this preference, the GPHC Board has implemented an advisory vote on executive compensation once every year. The next required vote on the frequency of stockholder votes will occur at the 2023 Annual Meeting of GPHC Stockholders.

Compensation of Executive Officers

The following table sets forth the compensation paid to or earned by the Named Executive Officers for each of the three fiscal years ended December 31, 2019.

Summary Compensation Table


Name and Principal Position	Year		Salary ($)		Stock Awards ($) (1)		Non-Equity Incentive Plan Compensation ($)		Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) (2)		All Other Compensation ($)			Total ($)
Michael P. Doss President and Chief Executive Officer (Principal Executive Officer)		2019		1,055,000		5,497,311		1,899,000		436,904		265,977	(3)		9,154,192
		2018		1,025,000		4,832,930		1,230,000		—		176,340			7,264,270
		2017		927,000		4,180,965		509,850		200,164		158,261			5,976,240



Stephen R. Scherger Executive Vice President and Chief Financial Officer (Principal Financial Officer)	2019	648,900	1,665,958		778,680	—	131,923	(4)	3,225,462
	2018	630,000	1,451,491		504,000	—	95,416		2,680,907
	2017	571,568	1,304,112		200,049	—	78,870		2,154,600

Stacey J. Valy Panayiotou Executive Vice President, Human Resources	2019	294,602	1,435,222	(5)	414,375	—	8,838	(6)	2,153,037

Lauren S. Tashma Executive Vice President, General Counsel and Secretary	2019	504,700	849,219		492,083		97,089	(7)	1,943,091
	2018	490,000	849,266		318,500	—	72,288		1,730,054
	2017	461,670	759,405		138,501	—	64,273		1,423,849

Joseph P. Yost Executive Vice President and President, Americas	2019	566,500	1,137,697		637,313	228,440	85,533	(8)	2,655,483	(9)
	2018	550,000	1,090,364		412,500	—	79,603		2,132,467
	2017	480,816	943,966		168,286	95,325	327,680		2,016,073

(1)

Amounts shown in this column represent the aggregate fair value of Service RSUs and Performance RSUs as of the date of grant, computed in accordance with FASB ASC Topic 718. The value of Performance RSUs assumes performance occurs at target level. The value of 2019 Stock Awards assuming payout of Performance RSUs at the maximum level is as follows: Mr. Doss: $9,150,509; Mr. Scherger: $2,773,064; Ms. Panayiotou; $1,910,443; Ms. Tashma: $1,413,558; and Mr. Yost: $1,893,743.

(2)

The amounts set forth in this column for Messrs. Doss and Yost for 2017 and 2019 reflect the aggregate increase in the present value of accumulated benefits under our Pension Plans during the respective year. The present value of Mr. Doss and Mr. Yost’s accumulated benefits under our Pension Plans decreased by $47,049 and $32,977, respectively, during 2018. Mr. Scherger, Ms. Panayiotou and Ms. Tashma do not participate in the Company’s Pension Plans. None of the Named Executive Officers realized above market or preferential earnings on deferred compensation.

(3)	The amount shown for Mr. Doss includes: (i) $23,896 of Company matching and supplemental contributions to the Company’s 401(k) Plan; (ii) $238,975 of Company matching and supplemental contributions to the NCDCP; and $3,106 for an executive physical.

(4)	The amount shown for Mr. Scherger represents: (i) $23,140 of Company matching and supplemental contributions to the Company’s 401(k) Plan; and (ii) $108,784 of Company matching and supplemental contributions to the NQDCP.

(5)

Ms. Panayiotou joined the company on April 22, 2019. Ms. Panayiotou received a new hire grant of Service RSUs on May 1, 2019 to compensate her for equity forfeited at her former employer, as well as a grant of both Service RSUs and Performance RSUs equivalent to what she would have received under the long-term incentive program.

(6)	The amount shown for Ms. Panayiotou includes: $8,838 of Company’s matching and supplemental contributions to the Company’s NQDCP.

(7)	The amount shown for Ms. Tashma includes: (i) $23,441 of Company matching and supplemental contributions to the Company’s 401(k) Plans; (ii) $70,868 of Company matching and supplemental contributions to the Company’s NQDCP; and $2,780 for an executive physical.

(8)

The amount shown for Mr. Yost includes (i) $22,818 of Company matching and supplemental contributions to the Company’s 401(k) Plan; and (ii) $62,715 of Company matching and supplemental contributions to the Company’s NQDCP. The amount shown does not reflect a $331,665 tax equalization settlement benefit related to Mr. Yost’s international assignment that ended in 2016.

(9)	The amount shown does not reflect a $331,665 tax equalization settlement benefit related to Mr. Yost’s international assignment that ended in 2016.

Additional Information regarding the Summary Compensation Table

Salary.

The amounts shown as salaries in the Summary Compensation Table for 2019 represent amounts actually paid during 2019 and may not be the same as current base salary levels at fiscal year end. The salaries shown include amounts contributed to GPHC’s NQDCP by the Executive.

Non-Equity

Incentive Plan Compensation.

The Company’s MIP is designed to provide short-term incentive awards based upon the accomplishment by GPHC of performance goals established at the beginning of each year. Awards are paid in cash during the first quarter of the following year. The amounts shown in the Summary Compensation Table represent amounts earned in 2019 and paid during the first quarter of 2020.

Stock Awards.

In 2019, the Compensation and Management Development Committee and the GPHC Board approved grants of RSUs under the 2014 Plan to our Named Executive Officers. These grants were made up of Service RSUs (1/3 of total grant) and Performance RSUs (2/3 of total grant). The number of shares paid out pursuant to the Performance RSUs is determined by the accomplishment of certain performance metrics established by the Board of Directors. For 2019 grants, the performance metrics are Adjusted EBITDA for the three-year period ending December 31, 2021 (60% weight) and return on invested capital for the three-year period ending December 31, 2021 (40% weight). All of the RSUs vest on the third anniversary of the date of grant and are payable in shares of GPHC’s common stock.

Change in Pension Value and

Non-Qualified

Deferred Compensation Earnings.

Amounts shown in the Change in Pension Value and

Non-Qualified

Deferred Compensation column of the Summary Compensation Table represent only the aggregate increase (if any) in the present value of accumulated benefits under our Pension Plans and Supplemental Plans. None of the Named Executive Officers realized above-market or preferential earnings on deferred compensation.

CEO Pay Ratio Information

In accordance with Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and Item 402(u) of Regulation

S-K

promulgated under the Exchange Act, GPHC and the Company are required to determine and disclose the total annual compensation of GPHC’s and the Company’s Principal Executive Officer (who is Michael P. Doss, GPHC’s President and CEO) and the total annual compensation of the employee with the median of the total annual compensation of all employees of GPHC (excluding Mr. Doss) and then express these amounts as a ratio.

To determine the employee with the median total annual compensation, GPHC chose all cash compensation paid during the calendar year to each of its domestic and international employees as of December 31, 2018 as its consistently applied compensation measure. GPHC did not annualize salaries for those employees who started working for GPHC midyear or those employees who were on leave for a portion of the year. For those international employees paid in a different currency, GPHC converted the total of all cash compensation paid to such employees to U.S. dollars, based on the exchange rate in effect on December 31, 2018.

After reviewing employee headcount and our compensation programs, GPHC determined that it did not have any change in its employee population or employee compensation arrangements in 2019 that it believes would significantly impact its pay ratio disclosure. Accordingly, for purposes of its 2019 pay ratio disclosure, GPHC is using the same median employee that was identified for purposes of its 2018 pay ratio disclosure.

Using the methodology described above and the median employee identified based upon 2018 data, GPHC determined the median employee’s total annual compensation for 2019 was $60,795. The total annual compensation of our President and CEO for 2019 was $9,154,192. The ratio of the total annual compensation of our President and CEO to the median employee’s total annual compensation was 151:1.

The following table sets forth information regarding the grants of annual cash incentive compensation and annual equity compensation during 2019 to the Named Executive Officers.

Grants of Plan-Based Awards in Fiscal 2019


Name	Grant Date	Estimated Future Payouts Under Non-Equity Incentive Plan Awards (1)						Estimated Future Payouts Under Equity Incentive Plan Awards						All Other Stock Awards; Number of Shares of Stock or Units (#) (5)		Grant Date Fair Value of Stock Awards ($) (6)
Name	Grant Date	Threshold ($)		Target ($)		Maximum ($)		Threshold (#) (2)		Target (#) (3)		Maximum (#) (4)				Grant Date Fair Value of Stock Awards ($) (6)
Michael P. Doss			0		1,266,000		2,532,000
	2/21/19								0		291,789		583,578				3,653,198
	2/21/19														145,895		1,844,113
Stephen R. Scherger			0		519,120		1,038,240
	2/21/19								0		88,427		176,854				1,107,106
	2/21/19														44,213		558,852
Stacey J. Valy Panayiotou			0		276,250		552,500
	5/01/19								0		37,957		75,914				475,222
	5/01/19														70,073		960,000
Lauren S. Tashma			0		328,055		656,110
	2/21/19								0		45,075		90,150				564,339
	2/21/19														22,538		284,880
Joseph P. Yost			0		424,875		849,750
	2/21/19								0		60,387		120,774				756,045
	2/21/19														30,194		381,652

(1)	The amounts set forth in these columns reflect the threshold, target and maximum cash payments that could have been earned during 2019 under the MIP.

(2)

Amounts in this column represent the threshold number of Performance RSUs that will be paid out assuming Company performance occurs at less than 90% of the Adjusted EBITDA performance measure and less than 95% of the Return on Invested Capital performance measure under the 2019 long-term incentive program (the “2019 LTIP”).

(3)	Amounts in this column represent the number of Performance RSUs granted to each of the Named Executive Officers. This is the number of Performance RSUs that will be paid out assuming Company performance at the target levels under the 2019 LTIP.

(4)	Amounts in this column represent the maximum number of Performance RSUs that will be paid out to each of the Named Executive Officers under the 2019 LTIP, which is 200% of the target level grant.

(5)

Amounts in this column represent the number of Service RSUs granted to each of the Named Executive Officers under the 2019 LTIP. The Service RSUs vest after three years of continuous employment with the Company, or earlier upon a change in control or on a

pro-rata

basis upon a termination of employment due to death, disability or retirement.

(6)	Amounts in this column represent the aggregate grant date fair value of Performance RSUs and Service RSUs, computed in accordance with FASB ASC Topic 718. The value of the Performance RSUs assumes performance occurs at target level.

The following table sets forth the aggregate outstanding RSUs held by the Named Executive Officers at the end of fiscal 2019. None of the Named Executive Officers held any stock options at the end of fiscal 2019.

Outstanding Equity Awards at 2019 Fiscal Year End


	Stock Awards
Name	Numbers of Shares or Units of Stock that have not Vested (#) (1)			Market Value of Shares or Units of Stock that have not Vested ($) (2)		Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) (3)			Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (2)
Michael P. Doss		345,873	(4)		5,758,785		720,814	(4)		12,001,553
Stephen R. Scherger		105,593	(5)		1,758,123		219,539	(5)		3,655,324
Stacey J. Valy Panayiotou		70,073	(6)		1,166,715		37,957	(6)		631,984
Lauren S. Tashma		58,430	(7)		972,860		121,541	(8)		2,023,658
Joseph P. Yost		75,423	(8)		1,255,793		157,119	(9)		2,616,031

(1)	The numbers in this column represent the aggregate number of Service RSUs held by each of the Named Executive Officers as of December 31, 2019.

(2)	Amounts in this column are calculated based on the closing price of the Company’s common stock on December 31, 2019.

(3)	The numbers in this column represent the number of Performance RSUs held by each of the Named Executive Officers as of December 31, 2019.

(4)	Mr. Doss’ RSUs vest as follows: 309,243 on February 23, 2020; 319,760 on February 22, 2021; and 437,684 on February 21, 2022.

(5)	Mr. Scherger’s RSUs vest as follows: 96,458 on February 23, 2020; 96,034 on February 22, 2021; and 132,640 on February 21, 2022.

(6)	Ms. Panayiotou’s RSUs vest as follows: 17,014 on May 1, 2020; 17,014 on May 1, 2021; and 74,002 on May 1, 2022.

(7)	Ms. Tashma’s RSUs vest as follows: 56,169 on February 23, 2020; 56,189 on February 22, 2021; and 67,613 on February 21, 2022.

(8)	Mr. Yost’s RSUs vest as follows: 69,820 on February 23, 2020; 72,141 on February 22, 2021; and 90,581 on February 21, 2022.

The following table sets forth information regarding RSUs held by the Named Executive Officers that vested and were paid out during 2019.

Option Exercises and Stock Vested


	Stock Awards (1)
Name	No. of Shares Acquired on Vesting		Value Realized on Vesting ($) (2)
Michael P. Doss		183,162		2,298,683
Stephen R. Scherger		60,409		758,133
Stacey J. Valy Panayiotou		—		—
Lauren S. Tashma		36,339		456,054
Joseph P. Yost		39,532		496,127

(1)	Only Stock Awards are included in the table because none of the Named Executive Officers held or exercised any stock options during 2019. The numbers in this column show the aggregate number of Performance RSUs and Service RSUs vested and paid out during 2019.

(2)	Value realized represents the fair market value of the shares on the vesting date.

Pension Benefits at 2019 Fiscal Year End


Name	Plan Name	Number of Years Credited Service (#)		Present Value of Accumulated Benefit ($) (1)		Payments During Last Fiscal Year ($) (3)
Michael P. Doss (2)	Riverwood International Employees Retirement Plan		11		455,195	$	252,654
	Riverwood International Supplemental Retirement Plan		11		1,024,455		0
	GPIC Retirement Plan		5		185,736	$	110,590
	Graphic Packaging Supplemental Retirement Plan		5		14,257		0
Stephen R. Scherger	—		—		—		—
Stacey J. Valy Panayiotou	—		—		—		—
Lauren S. Tashma	—		—		—		—
Joseph P. Yost (2)	Riverwood International Employees Retirement Plan		11		429,578	$	249,149
	Riverwood International Supplemental Retirement Plan		11		377,764		0

(1)	The valuation method and assumptions used in calculating the present value of the accumulated benefits are set forth in Note 8 of the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.

(2)

Mr. Doss was transferred to the Riverwood International Employees Retirement Plan and Riverwood International Supplemental Retirement Plan as of January 1, 2005. Benefit service was frozen on December 31, 2004 for both the GPIC Retirement Plan and the Graphic Packaging Supplemental Retirement Plan. Mr. Doss and Mr. Yost’s benefit service for the Riverwood International Employees Retirement Plan and the Riverwood International Supplemental Retirement Plan was frozen as of June 30, 2011. Effective January 1, 2017, the Riverwood International Employees Retirement Plan and the GPIC Retirement Plan were merged into the GPI US Consolidated Pension Plan, but are shown separately in the table above because they are treated as subplans under the consolidated plan.

(3)	In 2019, Mr. Doss and Mr. Yost received lump-sum payments in settlement of the Company’s obligations to them under the GPI US Consolidated Pension Plan.

Additional Information regarding the Pension Benefits at 2019 Fiscal Year End Table

The Riverwood International Employees Retirement Plan and Riverwood International Supplemental Retirement Plan.

All U.S. salaried employees hired prior to January 1, 2008, who satisfied the service eligibility criteria and who

were not participants in the Graphic Packaging International Corporation Retirement Plan (the “GPIC Retirement Plan”) are

participants

in the Riverwood International Employees Retirement Plan (the “Employees Retirement Plan”). Pension benefits under this plan are limited in accordance with the provisions of the Code governing

tax-qualified

pension plans. The Company also maintains the Riverwood International Supplemental Retirement Plan for participants in the Employees Retirement Plan that provides for payment to participants of retirement benefits equal to the excess of the benefits that would have been earned by each participant had the limitations of the Code not applied to the Employees Retirement Plan and the amount actually earned by such participant under such plan. Service benefits were frozen under the plan for all participants other than those who were 50 years old and had 5 years of service (the “Grandfathered Participants”) as of June 30, 2011. Benefits under the Riverwood International Supplemental Retirement Plan are not

pre-funded;

such benefits are paid by GPHC.

Annual remuneration, defined as “Salary” in the Employees Retirement Plan, includes annual salary paid, amounts paid as bonuses under the annual incentive compensation plan and certain other bonus awards, but excludes payments in lieu of perquisites and payments under any equity incentive plan or long-term incentive plan.

As of December 31, 2019, Mr. Doss and Mr. Yost had the completed years of credited service set forth above in the Pension Benefit Table. Estimated benefits are not subject to a reduction to reflect the payment of Social Security benefits or other offset amounts. The years of service calculated for Mr. Doss include years of service credited under the GPIC Retirement Plan described below. Mr. Doss participated in the GPIC Retirement Plan until January 1, 2005 when he was transferred into the Employees Retirement Plan.

GPIC Retirement Plan.

The Company’s U.S. salaried employees who (i) were previously employed by Graphic Packaging International Corporation (“GPIC”), (ii) satisfied the service eligibility criteria and (iii) did not participate in the Employees Retirement Plan participate in the GPIC Retirement Plan. Pension benefits under the GPIC Retirement Plan are limited in accordance with the provisions of the Code governing tax qualified pension plans. GPIC also maintained the Graphic Packaging Supplemental Retirement Plan that provided the benefits that were not payable from the qualified retirement plan because of limitations under the Code. None of the Named Executive Officers participated in the GPIC Retirement Plan during 2019.

The following table sets forth information regarding the Named Executive Officers’ participation in GPHC’s NQDCP.

2019 Nonqualified Deferred Compensation


Name	Executive Contributions in Last FY ($) (1)		Registrant Contributions in Last FY ($) (2)		Aggregate Earnings in Last FY ($)		Aggregate Withdrawals/ Distributions ($)		Aggregate Balance at Last FYE ($) (3)
Michael P. Doss		158,200		238,975		513,237		—		2,354,301
Stephen R. Scherger		62,685		108,784		612,372		—		3,124,384
Stacey J. Valy Panayiotou		0		8,838		0		—		8,838
Lauren S. Tashma		39,837		70,868		73,698		—		514,368
Joseph P. Yost		12,375		62,715		188,631		—		850,343

(1)	These amounts were included as 2019 compensation in the “Salary” or “Non-Equity Incentive Plan Compensation” columns in the Summary Compensation Table.

(2)	These amounts, which were earned as of fiscal year end but not contributed until 2020, were included in compensation in the “All Other Compensation” column for 2019 in the Summary Compensation Table and are reflected in the “Aggregate Balance at Last FYE” column of this table.

(3)	In previous years the amounts shown below have been included in the Company’s Summary Compensation Table as compensation to the following Named Executive Officers:


Michael P. Doss	$	1,176,830
Stephen R. Scherger	$	1,651,159
Stacy J. Valy Panayiotou	$	0
Lauren S. Tashma	$	151,209
Joseph P. Yost	$	241,873

Deferred Compensation.

In 2011, GPHC implemented the NQDCP, a nonqualified deferred compensation plan to which Executives and other eligible senior employees may defer a portion of their annual base salary and/or payment under the MIP, and to which GPHC may also make additional contributions. Contributions to the NQDCP were first made during 2012. The NQDCP permits participants to defer and contribute from 1% to 50% of their base salary and up to 100% of their payment under the MIP to the plan. The NQDCP offers deemed investment options that generally mirror those available under GPHC’s 401(k) Plan. The Company may, in its discretion, make contributions to the NQDCP, such as 401(k) restoration matching contributions and other supplemental contributions for Executives and eligible senior employees who do not participate in or receive future service accruals to one of GPHC’s Pension Plans or Supplemental Plans. NQDCP distributions will be made or commence on the earlier of the

six-month

anniversary of a participant’s separation from service with GPHC, a change in control of GPHC or, if elected by the participant, on a specified date. Payment will be made in a lump sum or in annual installments (up to 10) as elected by the participant.

The following table provides information as of December 31, 2019, with respect to GPHC’s 2014 plan, under which GPHC equity securities are authorized for issuance:

2019 Equity Compensation Plan Information


Plan Category	Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (#)			Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights ($)		Number of Securities Remaining Available for Future Issuance (Excluding Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (#)
Equity compensation plan approved by stockholders		5,059,690	(1)		N/A		13,600,076	(2)
Equity compensation plans not approved by stockholders		N/A			N/A		N/A
Total		5,059,690	(1)		N/A		13,600,076	(2)

(1)	Includes no stock options and 5,059,690 RSUs. Does not include up to 3,151,306 additional shares that may be issued if the Performance RSUs are paid out at a level above target.

(2)

All of these securities are available for issuance under the 2014 Plan and may be granted as full-value awards. This number includes 4,054,610 shares transferred from the Company’s Amended and Restated 2004 Omnibus Stock and Incentive Compensation Plan to the 2014 Plan. The number also does not reflect up to 3,151,306 additional shares that may be issued if Performance RSUs are paid out at a level above target.

Potential Payments Upon Termination

The table below reflects the amount of compensation that would become payable to each of the Named Executive Officers under existing plans and arrangements if the Named Executive Officer’s employment was terminated (i) because of death; (ii) because of disability; (iii) by GPHC without cause or by the Named Executive Officer for Good Reason (as described in such Named Executive Officer’s employment agreement or, with respect to Ms. Panayiotou and Ms. Tashma, the Executive Severance Plan); or (iv) by GPHC without cause or by the Named Executive Officer for Good Reason within one year following a change in control of GPHC, in each such case as of December 31, 2019, given the Named Executive Officer’s compensation and service levels as of such date and, if applicable, based on GPHC’s closing stock price on that date. These benefits are in addition to benefits available prior to the occurrence of any termination of employment and benefits available to all salaried employees, such as distributions of employee contributions and Company matching contributions under GPHC’s 401(k) Plans and any accrued untaken vacation pay. These benefits are also in addition to the benefits described above in the Pension Benefits table.

In the event that a Named Executive Officer is terminated for cause, no cash severance is payable and the Named Executive Officer forfeits all unvested equity awards. In addition, no continued welfare benefits or outplacement services are provided to the Named Executive Officer.

The actual amounts that would be paid upon a Named Executive Officer’s termination of employment can be determined only at the time of an executive’s actual separation from GPHC. Due to the number of factors that affect the nature and amount of any benefits provided upon the events shown below, actual amounts paid or distributed may be higher or lower than reported below. Factors that could affect these amounts include the timing during the year of any such event, the maximum payouts under any incentive plans and the executive’s age.


	Termination following Death						Termination following Disability						Termination Without Cause or for Good Reason (1)						Termination following a Change in Control (1)
Name	Cash ($)		Equity ($)		Total ($)		Cash ($)		Equity ($)		Total ($)		Cash ($)		Equity ($)		Total ($)		Cash ($)		Equity ($)		Total ($)
Michael P. Doss		3,649,913		10,269,698		13,919,611		3,561,996		8,807,318		12,369,314		5,882,996		8,807,318		14,690,314		8,203,996		17,760,339		25,964,335
Stephen R. Scherger		3,616,072		3,146,685		6,762,757		3,561,997		2,690,544		6,252,541		4,210,897		2,690,544		6,901,441		5,314,027		5,413,448		10,727,475
Stacey J. Valy Panayiotou		320,505		400,806		721,311		285,088		400,806		685,894		701,250		0		701,250		1,336,963		1,798,700		3,135,663
Lauren S. Tashma		877,163		1,789,301		2,666,464		835,105		1,523,683		2,358,788		1,339,805		1,523,683		2,863,488		2,084,238		2,996,517		5,080,755
Joseph P. Yost		1,309,260		2,278,905		3,588,165		1,262,052		1,948,733		3,210,785		1,828,552		1,948,733		3,777,285		2,749,115		3,871,824		6,620,939

(1)

In addition to the amounts shown, each Named Executive Officer receives life, medical, dental and prescription drug benefits for one year following the date of termination, as well as outplacement and career counseling services with a cost up to $25,000. The maximum annual amount of such continued life, medical, dental and prescription drug benefits for each of the Named Executive Officers is:


Michael P. Doss	$	28,891
Stephen R. Scherger	$	18,064
Stacy J. Valy Panayiotou	$	19,610
Lauren S. Tashma	$	18,321
Joseph P. Yost	$	22,940

In the event that the Named Executive Officer’s employment is terminated because of his or her retirement, such Named Executive Officer receives no cash severance and the same equity payout as if his or her employment had been terminated as a result of death.

Compensation Committee Interlocks and Insider Participation

Ms. Laurie Brlas and Messrs. David Campbell, Robert Hagemann, Dean Scarborough and Larry Venturelli served as members of the Compensation and Management Development Committee during 2019. None of these members is or has ever been an officer or employee of GPHC or the Company. No member had any relationship requiring disclosure as a compensation committee interlock during 2019.


ITEM 12.		SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

All of the ownership interests in the Company are held by its sole member, GPIP. No member of management owns or has any right to acquire ownership interests in the Company. The Company has no compensation plans under which its securities are authorized for issuance and its equity securities are not traded on any exchange or market.


ITEM 13.		CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The Company does not have a separate policy regarding related party transactions, as all employees of the Company are subject to the Policy Regarding Related Party Transactions adopted by the Audit Committee of the Board of Directors of Graphic Packaging Corporation (the publicly-traded predecessor to GPHC).

The Policy Regarding Related Party Transactions defines a “Related Party Transaction” as any transaction, arrangement or relationship (including any indebtedness or guarantee of indebtedness) in which (a) the aggregate amount involved will or may be expected to exceed $120,000 in any fiscal year, (b) GPHC (or any of its subsidiaries, including the Company) is a participant, and (c) any Related Party (as defined below) has or will have a direct or indirect interest, other than an interest that arises solely as a result of being a director or beneficial owner of less than 10% of another entity. The policy defines a “Related Party” as any (a) person who is or was since the beginning of the last fiscal year an executive officer, director or nominee for election as a director of the GPHC (or any of its subsidiaries), (b) any beneficial owner of more than 5% of GPHC’s common stock, (c) an immediate family member of any of the foregoing, or (d) any firm, corporation or other entity in which any of the foregoing is employed, is a principal or serves in a similar position, or has a beneficial ownership of more than 5%.

The Policy Regarding Related Party Transactions provides that the Audit Committee shall review all of the material facts and circumstances of all Related Party Transactions and either approve, ratify or disapprove of the entry into the Related Party Transaction. In determining whether to approve a Related Party Transaction, the Audit Committee will take into account, among other factors it deems appropriate, whether the Related Party Transaction is on terms no less favorable than terms generally available to an unaffiliated third-party under the same or similar circumstances, the benefits to the Company, the extent of the Related Party’s interest in the transaction, and if the Related Party is a director or a nominee for director, the impact on such director’s independence. The policy provides that certain Related Party Transactions, including certain charitable contributions, transactions involving competitive bids and transactions in which all stockholders receive proportional benefits, are

pre-approved

and do not require an individual review by the Audit Committee. You may find a copy of the Policy Regarding Related Party Transactions on GPHC’s website at www.graphicpkg.com in the Investors section under Corporate Governance.


ITEM 14.		PRINCIPAL ACCOUNTANT FEES AND SERVICES

The audit of the Company’s financial statements and internal control over financial reporting is part of the consolidated audit of GPHC and its subsidiaries (including the Company). The fees for the consolidated audit and other services for GPHC and its subsidiaries are set forth below.

Audit Fees

Aggregate fees billed to the Company and GPHC for the fiscal years ended December 31, 2019 and December 31, 2018 by our independent auditors, Ernst & Young LLP, are as follows:


	Year Ended December 31,
	2019		2018

	(in millions)
Audit Fees	$	4.1	$	5.0
Audit-Related Fees		0.2		0.1
Tax Fees		—		—
All Other Fees		—		—

Total	$	4.3	$	5.1

Audit Fees

. This category includes the aggregate fees billed for professional services rendered for the audit of our consolidated financial statements and internal control over financial reporting for the fiscal years ended December 31, 2019 and December 31, 2018, for the reviews of the financial statements included in our Quarterly Reports on Form

10-Q

during 2019 and 2018, and for services that are normally provided by the independent auditors in connection with statutory and regulatory filings or engagements for the relevant fiscal years.

Audit-Related Fees.

This category includes the aggregate fees billed in each of the last two fiscal years for assurance and related services by the independent auditors that are reasonably related to the performance of the audits or reviews of the financial statements and are not reported above under “Audit Fees,” and generally consist of fees for accounting consultation and audits of employee benefit plans.

Tax Fees

. This category includes the aggregate fees billed in each of the last two fiscal years for professional services rendered by the independent auditors for tax compliance, tax planning and tax advice.

All Other Fees

. This category includes the aggregate fees billed in each of the last two fiscal years for products and services provided by the independent auditors that are not reported above under “Audit Fees,” “Audit-Related Fees,” or “Tax Fees.”

The GPHC Audit Committee reviews and

pre-approves

audit and

non-audit

services performed by the Company’s independent auditors as well as the fees charged for such services. The Audit Committee has considered whether the provision of

non-audit

services by Ernst & Young LLP is compatible with maintaining the firm’s independence. The Audit Committee may delegate

pre-approval

authority for such services to one or more members, whose decisions are then presented to the full Audit Committee at its scheduled meetings. In 2019 and 2018, all of the audit and

non-audit

services provided by our independent auditors were

pre-approved

by the Audit Committee in accordance with the Audit Committee Charter.

PART IV


ITEM 15.		EXHIBITS AND FINANCIAL STATEMENT SCHEDULES


Exhibit Number		Description

31.1		Certification required by Rule 13a-14(a).

31.2		Certification required by Rule 13a-14(a).

101.INS		Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH		XBRL Taxonomy Extension Schema

101.CAL		XBRL Taxonomy Extension Calculation Linkbase

101.DEF		XBRL Taxonomy Extension Definition Linkbase

101.LAB		XBRL Taxonomy Extension Label Linkbase

101.PRE		XBRL Taxonomy Extension Presentation Linkbase

104		Cover Page Interactive Data File – the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document (included in Exhibit 101).

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

GRAPHIC PACKAGING INTERNATIONAL, LLC

(Registrant)

By:

GRAPHIC PACKAGING INTERNATIONAL PARTNERS, LLC

(Sole Member)


/s/ Stephen R. Scherger	Executive Vice President and Chief Financial Officer (Principal Financial Officer)	August 13, 2020
Stephen R. Scherger

Pursuant to the requirements of the Securities Exchange Act of 1934, this Amendment No. 1 on Form

10-K/A

has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.


/s/ Michael P. Doss	President and Chief Executive Officer (Principal Executive Officer)	August 13, 2020
Michael P. Doss

/s/ Stephen R. Scherger	Executive Vice President and Chief Financial Officer (Principal Financial Officer)	August 13, 2020
Stephen R. Scherger

/s/ Charles D. Lischer	Senior Vice President and Chief Accounting Officer (Principal Accounting Officer)	August 13, 2020
Charles D. Lischer

GRAPHIC PACKAGING INTERNATIONAL, LLC 10-K/A