Cross Country Healthcare, Inc.
CROSS COUNTRY HEALTHCARE INC (Form: DEF 14A, Received: 04/10/2017 12:47:24)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934

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CROSS COUNTRY HEALTHCARE, INC.
(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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CROSS COUNTRY HEALTHCARE, INC.
5201 Congress Avenue
Boca Raton, Florida 33487

April 10, 2017

Dear Cross Country Healthcare Stockholder:

I invite you to attend our Annual Meeting of Stockholders. The meeting will be held on Tuesday, May 23, 2017 at 12:00 p.m. Eastern Time at the offices of Proskauer Rose LLP at Eleven Times Square, New York, New York 10036-8299.

On the following pages, you will find the Notice of Meeting, which lists the matters to be considered and acted upon at the meeting, and the Proxy Statement. After the formal business session, we will discuss the financial results for 2016 and report on current operations.

Your vote is very important regardless of the number of shares you own. Detailed voting instructions appear on page 1 of the Proxy Statement. The Board of Directors unanimously recommends that you vote “FOR” Proposals I, II, III, IV and V described in the Proxy Statement.

 
Sincerely,
 

 
William J. Grubbs
President and Chief Executive Officer

CROSS COUNTRY HEALTHCARE, INC.
5201 Congress Avenue
Boca Raton, Florida 33487

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD MAY 23, 2017

To the Holders of Common Stock:

The Annual Meeting of Stockholders of Cross Country Healthcare, Inc. (the “Company”) will be held at the offices of Proskauer Rose LLP at Eleven Times Square, New York, New York 10036-8299 on Tuesday, May 23, 2017, at 12:00 p.m. Eastern Time for the following purposes:

1. The election of seven directors to the Company’s Board of Directors to hold office until the next Annual Meeting or until their respective successors are duly elected and qualified;

2. The approval and ratification of the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2017;

3. To approve the amendment and restatement of the Company’s 2014 Omnibus Incentive Plan;

4. The non-binding advisory vote to approve compensation of the Company’s named executive officers, as described in this proxy statement;

5. The non-binding advisory vote on the frequency of stockholder advisory votes to approve compensation of the Company’s named executive officers; and

6. To transact such other business, if any, as may properly come before the meeting or any adjournment thereof.

Stockholders of record at the close of business on March 27, 2017 are entitled to receive notice of, and to vote at, the Annual Meeting.

Important Notice Regarding the Availability of
Proxy Materials for the Annual Meeting of Stockholders
to be Held on May 23, 2017

The Proxy Statement and the Annual Report to stockholders are available online at our website at http://ir.crosscountryhealthcare.com. We are pleased to take advantage of the Securities and Exchange Commission rules that allow us to furnish these proxy materials and our Annual Report to stockholders on the Internet. We believe that posting these materials on the Internet enables us to provide stockholders with the information that they need more quickly, while lowering our costs of printing and delivery and reducing the environmental impact of our Annual Meeting.

 
By Order of the Board of Directors,
 

 
Susan E. Ball
Executive Vice President,
General Counsel and Secretary
   
 
 
April 10, 2017

YOUR VOTE IS IMPORTANT. ACCORDINGLY, THE COMPANY URGES YOU TO
COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD REGARDLESS OF
WHETHER YOU PLAN TO ATTEND THE ANNUAL MEETING. STOCKHOLDERS CAN
ALSO RETURN THEIR VOTE BY THE INTERNET OR BY PHONE – PLEASE SEE
THE PROXY CARD FOR VOTING INSTRUCTIONS.

CROSS COUNTRY HEALTHCARE, INC
5201 Congress Avenue
Boca Raton, Florida 33487

PROXY STATEMENT

GENERAL INFORMATION

These proxy materials are furnished in connection with the solicitation by the Board of Directors of Cross Country Healthcare, Inc. (“Cross Country,” “the Company,” “our,” “we,” or “us”), a Delaware corporation, of proxies to be voted at our 2017 Annual Meeting of Stockholders (the “Annual Meeting”), or at any adjournment or postponement thereof.

You are invited to attend our Annual Meeting on Tuesday, May 23, 2017, beginning at 12:00 p.m. Eastern Time at the offices of Proskauer Rose LLP at Eleven Times Square, New York, New York 10036-8299.

Electronic Notice and Mailing. Pursuant to the rules promulgated by the Securities and Exchange Commission, or the Commission, we are making our proxy materials available to you on the Internet. Accordingly, we will mail a Notice of Internet Availability of proxy materials (which we refer to as the Notice of Internet Availability) to the beneficial owners of our common stock, par value $.0001 per share, or Common Stock, on or about April 10, 2017. From the date of the mailing of the Notice of Internet Availability until the conclusion of the Annual Meeting, all beneficial owners will have the ability to access all of the proxy materials at www.proxyvote.com. All stockholders will have an opportunity to request a paper or e-mail delivery of these proxy materials.

The Notice of Internet Availability will contain:

the date, time and location of the Annual Meeting, the matters to be acted upon at the Annual Meeting and the Board of Directors’ recommendation with regard to each matter;
the Internet address that will enable access to the proxy materials;
a comprehensive listing of all proxy materials available on the website;
a toll-free phone number, e-mail address and Internet address for requesting either paper or e-mail delivery of proxy materials;
the last reasonable date a stockholder can request materials and expect them to be delivered prior to the meeting; and
instructions on how to access the proxy card.

You may also request a paper or e-mail delivery of the proxy materials on or before the date provided in the Notice of Internet Availability by calling 1-800-579-1639. We will fill your request within three business days. You will also have the option to establish delivery preferences that will be applicable for all your future mailings.

How to Vote. Stockholders of record (that is, stockholders who hold their shares in their own name) can vote any one of four ways:

1) By Internet : Go to the website www.proxyvote.com to vote via the Internet. You will need to follow the instructions on your proxy card and the website. If you vote via the Internet, you may incur telephone and Internet access charges.
2) By Telephone : Call the toll-free number 1-800-690-6903 to vote by telephone. You will need to follow the instructions on your proxy card and the recorded instructions.
3) By Mail : If you prefer, you can contact us to obtain copies of all proxy materials, including proxy cards, by calling 1-800-579-1639, or by mail: Cross Country Healthcare, Inc., General Counsel, at 5201 Congress Avenue, Boca Raton, Florida, 33487. If you contact us to request a proxy card, please mark, sign and date the proxy card and return it promptly in the self-addressed, stamped envelope, that we will provide. If you sign and return your proxy card but do not give voting instructions, the shares represented by that proxy will be voted as recommended by the Board of Directors.

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4) In Person : You can attend the Annual Meeting, or send a personal representative with an appropriate proxy, to vote by ballot. Record holders and other beneficial owners holding shares in the name of a bank, broker or other holder of record (“street name”) or their proxies may attend the Annual Meeting in person. When you arrive at the Annual Meeting, you must present photo identification, such as a driver’s license.

If you vote via the Internet or by telephone, your electronic vote authorizes the named proxies to vote in the same manner as if you signed, dated and returned your proxy card. If you vote via the Internet or by telephone, do not mail a proxy card.

If your shares are held in street name you will receive instructions from the holder of record that you must follow in order for your shares to be voted. Internet and telephone voting also will be offered to stockholders owning shares through most banks and brokers.

Stockholders Entitled to Vote. Persons holding shares of our Common Stock at the close of business on March 27, 2017, the record date for the Annual Meeting, are entitled to receive notice of and to vote their shares at the Annual Meeting. As of that date, there were 36,247,208 shares of Common Stock outstanding. Each share of Common Stock is entitled to one vote on each matter properly brought before the Annual Meeting.

Revocability of Proxies. You may revoke your proxy and reclaim your right to vote up to and including the day of the Annual Meeting by giving written notice of revocation to us (to the attention of the Inspectors of Election), timely delivering a valid, later-dated proxy or voting by ballot at the Annual Meeting. Please note that attendance at the Annual Meeting will not by itself revoke a proxy.

Vote at the Annual Meeting. Your mail-in vote, your e-vote or vote by telephone will not limit your right to vote at the Annual Meeting if you later decide to attend in person. If your shares are held in “street name,” as described above, you must obtain a proxy, executed in your favor, from the holder of record to be able to vote at the meeting.

All shares that have been properly voted and not revoked will be voted at the Annual Meeting in accordance with your instructions. If you sign and return your proxy card, or vote by internet or telephone but fail to give voting instructions, the shares represented by the proxy will be voted by the Proxy Committee as recommended by the Board of Directors. The Proxy Committee consists of William J. Grubbs and Thomas C. Dircks.

Other Matters. Proxy cards, unless otherwise indicated by the stockholder, confer upon the Proxy Committee discretionary authority to vote all shares of stock represented by the proxies on any matter which may be properly presented for action at the Annual Meeting even if not covered herein. If any of the nominees for director named in Proposal I—Election of Directors should be unavailable for election, the proxies will be voted for the election of such other person as may be recommended by the Board of Directors in place of such nominee. The Board of Directors is not aware of any matter for action by the stockholders at the Annual Meeting other than the matters described in the Notice.

Quorum. The presence, in person or by proxy, of the holders of a majority of the shares of Common Stock issued and outstanding entitled to vote at the Annual Meeting is required to constitute a quorum. Abstentions and broker non-votes (i.e., proxies from brokers or nominees indicating that such persons have not received instructions from the beneficial owner or other persons entitled to vote shares as to a matter with respect to which the brokers or nominees do not have discretionary power to vote) are counted as present for purposes of determining the presence or absence of a quorum for the transaction of business.

Required Vote; Abstentions and Broker Non-Votes. Directors will be elected by a majority of the votes cast at the Annual Meeting in an uncontested election. Votes withheld, abstentions and broker non-votes will not have any effect on the outcome of voting with respect to the election of directors, unless no affirmative votes are received for a nominee. The affirmative vote of holders of a majority of shares represented at the Annual Meeting, in person or by proxy, and entitled to vote is required for approval of (i) the election of seven directors to the Company’s Board of Directors to hold office until the next Annual Meeting or until their respective successors are duly elected and qualified, (ii) the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2017, (iii) the amendment and restatement of the Company’s 2014 Omnibus Incentive Plan, (iv) the non-binding vote regarding the compensation of the Company’s named executive officers as described in this proxy statement, and (v) the

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non-binding vote regarding the frequency of stockholder advisory votes to approve the compensation of the Company’s named executive officers. Abstentions have the same effect as a vote against these proposals. Broker non-votes are deemed not entitled to vote and are not counted as votes for or against any proposal.

Proxy Solicitation. We will bear the cost of solicitation, including the preparation, assembly, printing and mailing of the proxy materials. Copies of solicitation materials will be furnished to brokerage houses, fiduciaries and custodians holding shares in their names that are beneficially owned by others so that they may forward this solicitation material to such beneficial owners. In addition, we may reimburse such persons for their costs in forwarding the solicitation materials to such beneficial owners. The original solicitation of proxies by mail may be supplemented by a solicitation by telephone, telegram or other means by our directors, officers or employees. No additional compensation will be paid to these individuals for any such services. Except as described above, we do not presently intend to solicit proxies other than by mail.

Stockholder Communications. The Board of Directors has adopted a process by which stockholders may communicate with our directors. Any stockholder wishing to do so may call our toll-free phone number at 800-354-7197 or send an e-mail to governance@crosscountryhealthcare.com. All such communications will be kept confidential and forwarded directly to the Board of Directors or any individual director or committee of the Board of Directors, as applicable.

Code of Ethics and Business Ethics Policy. We have adopted a code of ethics and a business ethics policy that applies to all of our employees, including executive officers and the Board of Directors. The code of ethics and business ethics policy are available on our website at www.crosscountryhealthcare.com by choosing the “Investors” link, clicking on the “Corporate Governance” section, and selecting the respective document under “View.” A copy is on file with the Commission as an exhibit to our Annual Report on Form 10-K for the year ended December 31, 2015 (filed as Exhibit 14.1 on March 11, 2016).

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SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information, as of March 27, 2017, regarding the beneficial ownership of our Common Stock by each person who is known by us to be the beneficial owner of 5% or more of our Common Stock, our Chief Executive Officer, Chief Financial Officer, and the three most highly compensated persons (other than the CEO and CFO) who were serving as executive officers at December 31, 2016 (referred to herein as Named Executive Officers, or the NEOs), each of our directors and director nominees, and all directors and executive officers as a group. The percentages in the last column are based on 36,247,208 shares of Common Stock outstanding on March 27, 2017, plus the number of shares of Common Stock deemed to be beneficially owned by such individual or group pursuant to Rule 13d-3(d)(1) of the Securities Exchange Act of 1934, as amended, or the Exchange Act. In each case, except as otherwise indicated in the footnotes to the table, the shares shown in the second column are owned directly by the individual or members of the group named in the first column and such individual or group members have sole voting and dispositive power with respect to the shares shown. For purposes of this table, beneficial ownership is determined in accordance with federal securities laws and regulations. Persons shown in the table disclaim beneficial ownership of all securities not held by such persons directly and inclusion in the table of shares not owned directly by such persons does not constitute an admission that such shares are beneficially owned by the director or officer for purposes of Section 16 of the Exchange Act or any other purpose. Shares of Common Stock subject to options that are currently exercisable or exercisable within 60 days of March 27, 2017 are deemed outstanding for computing the ownership percentage of the stockholder holding such shares, but are not deemed outstanding for computing the ownership percentage of any other stockholder.

Name
Number of Shares of
Common Stock
Beneficially Owned
Percentage of
Outstanding
Common Stock
Owned
Wellington Management Group LLP
 
3,918,234
(a)(b)
 
10.8
%
Blackrock Inc.
 
3,730,427
(a)(c)
 
10.3
%
JPMorgan Chase & Co
 
2,801,875
(a)(d)
 
7.7
%
Wells Fargo & Company
 
1,884,250
(a)(e)
 
5.2
%
Vickie L. Anenberg
 
117,448
(f)(g)
 
 
*
Susan E. Ball
 
146,889
(f)(g)
 
 
*
William J. Burns
 
111,394
(f)(g)
 
 
*
W. Larry Cash
 
99,253
(f)(g)
 
 
*
Thomas C. Dircks
 
95,264
(f)(g)
 
 
*
Gale Fitzgerald
 
84,253
(f)(g)
 
 
*
William J. Grubbs
 
382,356
(f)(g)
 
1.1
%
Richard M. Mastaler
 
64,626
(f)(g)
 
 
*
Mark Perlberg
 
16,733
(f)(g)
 
 
*
Joseph A. Trunfio, PhD
 
110,053
(f)(g)
 
 
*
All directors and executive officers as a group
 
1,405,115
(h)
 
3.9
%
* Less than 1%
(a) Addresses are as follows: Wellington Management Group LLP, 280 Congress Street, Boston, MA 02210; BlackRock, Inc., 55 East 52 nd Street, New York, NY 10055; JPMorgan Chase & Co., 270 Park Ave., New York, NY 10017; and Wells Fargo & Company, 420 Montgomery Street, San Francisco, CA 94163.
(b) The information regarding the beneficial ownership of shares by Wellington Management Group LLP was obtained from its statement on Schedule 13G, filed with the Commission on February 9, 2017. Such statement discloses that Wellington Management Group LLP shares voting power of 2,895,322 shares and has shared dispositive power of 3,918,234 shares.

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(c) The information regarding the beneficial ownership of shares by BlackRock, Inc. was obtained from its statement on Schedule 13G/A, filed with the Commission on January 12, 2017. Such statement discloses that BlackRock, Inc. possesses sole voting power over 3,665,048 shares and sole dispositive power over 3,730,427 shares.
(d) The information regarding the beneficial ownership of shares by JPMorgan Chase & Co. was obtained from its statement on Schedule 13G/A, filed with the Commission on January 13, 2017. Such statement discloses that JP Morgan & Co. possesses sole voting power over 2,414,200 shares and sole dispositive power over 2,761,575 shares.
(e) The information regarding the beneficial ownership of shares by Wells Fargo & Company was obtained from its statement on Schedule 13G, filed with the Commission on January 24, 2017. Such statement discloses that Wells Fargo & Company possesses shared voting power over 627,549 shares and shared dispositive power over 1,862,410 shares.
(f) Includes shares of Common Stock which such individuals have the right to acquire through the exercise of stock options within 60 days of March 27, 2017 as follows: Vickie L. Anenberg, 0; Susan E. Ball, 0; William J. Burns, 0; W. Larry Cash, 0; Thomas C. Dircks, 0; Gale Fitzgerald, 0; William J. Grubbs, 12,500; Richard M. Mastaler, 0; Mark Perlberg, 0; and Joseph A. Trunfio, 0. Includes Restricted Shares as follows: Vickie L. Anenberg, 58,820; Susan E. Ball, 43,890; William J. Burns, 69,175; W. Larry Cash, 21,992; Thomas C. Dircks, 21,992; Gale Fitzgerald, 21,992; William J. Grubbs, 194,506; Richard M. Mastaler, 21,992; Mark Perlberg, 13,576; and Joseph A. Trunfio, 21,992.
(g) Address is c/o Cross Country Healthcare, Inc., 5201 Congress Avenue, Boca Raton, Florida 33487.
(h) Includes 29,375 shares of Common Stock which the directors and executive officers have the right to acquire through the exercise of stock options within 60 days of March 27, 2017 and 555,311 shares of Restricted Stock.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

The members of our Board of Directors, our executive officers and persons beneficially owning 10% or more of our outstanding Common Stock are subject to the reporting requirements of Section 16(a) of the Exchange Act that requires them to file reports with respect to their ownership of our Common Stock and their transactions in such Common Stock. Based solely upon a review of (i) the copies of Section 16(a) reports that we have received from such persons or entities for transactions in our Common Stock and their Common Stock holdings for the year ended December 31, 2016 and (ii) the written representations received from one or more of such persons or entities that no annual Form 5 reports were required to be filed by them for such fiscal year, we believe that all reporting requirements under Section 16(a) for such fiscal year were met in a timely manner by our directors, executive officers and beneficial owners of 10% or more of our Common Stock.

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PROPOSAL I
ELECTION OF DIRECTORS

The Board of Directors currently consists of seven members. All of the directors currently serving on the Board of Directors have been nominated by the Governance and Nominating Committee of the Board of Directors to stand for re-election at the Annual Meeting of Stockholders for one-year terms. The Board of Directors unanimously approved these nominations. Each nominee elected will hold office until the Annual Meeting of Stockholders to be held in 2018 and until a successor has been duly elected and qualified unless, prior to such meeting a director shall resign, or his or her directorship shall become vacant due to his or her death, resignation or removal. All nominees were elected at the Annual Meeting of Stockholders held in 2016.

Each nominee has agreed to serve, if elected, and management has no reason to believe that they will be unavailable to serve. If any of the nominees should be unavailable for election, the proxies will be voted for the election of such other person as may be recommended by the Board of Directors in place of such nominee. Shares properly voted will be voted FOR the nominees unless the stockholder indicates on the proxy that authority to vote the shares is withheld for one or more or for all of the nominees listed. A proxy cannot be voted for a greater number of persons than the seven nominees named below. Directors are elected by a majority of the votes cast in an uncontested election. Votes withheld, abstentions and broker non-votes will not have any effect on the outcome of voting with respect to the election of directors unless no affirmative votes are received for a nominee. The following seven individuals have been nominated for election at the Annual Meeting of Stockholders for a one-year term ending upon the 2018 Annual Meeting of Stockholders:

Name
Age
Position
William J. Grubbs
59
President, Chief Executive Officer and Director
W. Larry Cash
68
Director
Thomas C. Dircks
59
Chairman of the Board and Director
Gale Fitzgerald
66
Director
Richard M. Mastaler
71
Director
Mark Perlberg
61
Director
Joseph A. Trunfio, PhD
70
Director

The Board recommends that holders vote “FOR” the election of the nominees.

In selecting qualified individuals to serve on our Board of Directors, among other attributes, we look for those individuals who possess characteristics that include integrity, business experience, financial acumen and leadership abilities, familiarity with our business and businesses similar or analogous to ours, and the extent to which a candidate’s knowledge, skills, background and experience are already represented by other members of our Board of Directors. In addition, in composing a well-rounded Board of Directors, we look for those individuals possessing a diversity of complementary skills, core-competencies and expertise, including diversity with respect to age, gender, national origin and race, for the optimal functioning of the Board and with a view toward constituting a Board with the appropriate skills and experience necessary to oversee our business.

The following information sets forth the principal occupation and employment during at least the past five years of each director nominee, positions and offices with us, specific skills, attributes and qualifications and certain other information. In addition, we have summarized for each director nominee why such director nominee has been chosen to serve on our Board of Directors. No family relationship exists among any of the nominees or executive officers.

William J. Grubbs became President, Chief Operating Officer and a director of the Company on April 1, 2013. He became Chief Executive Officer of the Company on July 5, 2013. From October 2012 through March 2013, Mr. Grubbs was Executive Vice President and Chief Operating Officer of Trueblue, Inc., a staffing company. From 2005 through 2011, Mr. Grubbs held various senior executive positions with SFN Group, Inc., a staffing company formerly known as Spherion Corporation (“SFN Group, Inc.”). Mr. Grubbs holds a B.S. degree in Computer Science from University of New Hampshire. He is currently a member of the Board of Directors of Volt Information Sciences, Inc.

The Board has concluded that Mr. Grubbs should serve as a director due to his extensive executive level management skills and operational experience.

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W. Larry Cash has been a director and Audit Committee member since October 2001 and a Compensation Committee member since May 2006. He is currently President of Financial Services and Chief Financial Officer of Community Health Systems. He joined Community Health Systems as Executive Vice President and Chief Financial Officer in September 1997 and was named to the board of directors of Community Health Systems in 2001. Prior to joining Community Health Systems, Mr. Cash served as Vice President and Group Chief Financial Officer of Columbia/HCA Healthcare Corporation from September 1996 to August 1997. Prior to Columbia/HCA, Mr. Cash spent 23 years at Humana, Inc., most recently as Senior Vice President of Finance and Operations from 1993 to 1996. He received his B.S. in Accounting from the University of Kentucky at Lexington. He is currently a member of the Board of Directors of Community Health Systems.

For eleven consecutive years, Mr. Cash was recognized as one of the Top 3 CFOs in the healthcare sector by Institutional Investor magazine. He was named Business Tennessee ’s first ever CFO of the Year in 2008 and also earned that distinction in the public companies category from the Nashville Business Journal in 2009.

The Board has concluded that Mr. Cash should serve as a director due to his extensive executive level management skills, corporate financial management and operational experience. Additionally, Mr. Cash has a vast understanding of many aspects of the healthcare industry and brings solid expertise and proven leadership skills to the Board.

Thomas C. Dircks has been a director since July 1999 and was elected to serve as Chairman of the Board of Directors on August 2, 2013. Mr. Dircks served as a member of the Compensation Committee from October 2001 through December 2013, and as a member of the Governance and Nominating Committee from March 2004 through December 31, 2013. Mr. Dircks has been a Managing Director of Charterhouse Strategic Partners, a private investment firm, since July 1, 2016. Mr. Dircks had been Managing Partner of Charterhouse Group, Inc. since June 2002 and had been employed as an executive officer of Charterhouse Group since 1983. He was previously employed as a Certified Public Accountant at a predecessor of PricewaterhouseCoopers, LLP. He holds a B.S. in Accounting and a Masters of Business Administration from Fordham University.

The Board has concluded that Mr. Dircks should serve as a director due to his extensive executive management, accounting, tax, mergers and acquisition, and strategic planning expertise. Additionally, Mr. Dircks’ risk management skills and financial acumen add an important dimension to our Board’s composition.

Gale Fitzgerald has been a director and member of the Audit Committee since May 2007, and since January 2014 has served as the Chairperson of the Governance and Nominating Committee. Ms. Fitzgerald is a retired principal of TranSpend, Inc., a consulting company. Before co-founding TranSpend, Inc. in 2003, she served as the President of QP Group, Inc. Prior to joining QP Group, Inc., she served as the Chairman and Chief Executive Officer of Computer Task Group, Inc. from 1994 to 2000. She joined Computer Task Group, Inc. in 1991 as Senior Vice President and was promoted to President and Chief Operating Officer in July 1993. Prior to joining Computer Task Group, Inc., she was Vice President, Professional Services at International Business Machines Corporation, which evolved into IBM Global Services. Ms. Fitzgerald worked at IBM for 18 years in various technical, marketing and management positions. She is a member of the Board of Directors of Diebold Nixdorf, Inc. Ms. Fitzgerald has a B.A. in Government from Connecticut College and a Masters in Theology from Augustine Institute in Denver, Colorado.

The Board has concluded that Ms. Fitzgerald should serve as a director because of her extensive executive leadership experience and management skills. Ms. Fitzgerald’s expertise provides an invaluable resource to the Board with respect to corporate and strategic planning and assessing and managing risks.

Richard M. Mastaler has been a director since June 21, 2011. Mr. Mastaler has served on the Audit Committee and Governance and Nominating Committee since January 2014. Mr. Mastaler is the Chairman and Chief Executive Officer of Managed Health Ventures, Inc., a managed care consulting firm, which he founded in 2002. He previously held executive-level positions with CCN Managed Care, Inc., Magellan Health Services, Inc., Preferred Health Networks, QualMed, Inc., Humana Medical Plan, Unilab Corporation, and three Humana hospitals. He also is a Fellow of the American College of Healthcare Executives. Mr. Mastaler holds B.S. degree in Business Administration from Florida State University and a Masters in Healthcare Administration from George Washington University.

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The Board has concluded that Mr. Mastaler should serve as a director because of his extensive healthcare and management experience. Mr. Mastaler’s experience in the healthcare industry provides an excellent resource to the Board for strategic planning and leadership purposes.

Mark Perlberg has been a director since May 12, 2015. He is currently President and Chief Executive Officer of Oasis Outsourcing, one of the nation’s leading Professional Employer Organizations. He has served in that capacity since October 2003. Prior to joining Oasis Outsourcing, Mr. Perlberg held a series of executive positions with Profit Recovery Group, the John Harland Group and Western Union. Prior to joining Western Union, he practiced law in New Jersey. Mr. Perlberg received his B.A. degree in History from the University of Rochester and his Juris Doctor degree from Boston College Law School.

The Board has concluded that Mr. Perlberg should serve as a director due to his extensive executive management and leadership experience in growing companies both organically and through acquisitions. Mr. Perlberg’s success during his career in overseeing the delivery of alternative workforce solutions brings a new perspective to the Company.

Joseph A. Trunfio, PhD has been a director since October 2001. He has served on the Governance and Nominating Committee since May 2006 and was appointed to the Compensation Committee as its Chairman, effective January 1, 2014. Mr. Trunfio served on the Audit Committee from October 2001 until December 2013. He served as President and Chief Executive Officer of Atlantic Health System, a not-for-profit hospital group, from March 1999 until his retirement in May 2015, where he was a member of the Board of Trustees. From July 1997 to February 1999, Mr. Trunfio served as President and Chief Executive Officer of Via Caritas Health System, a not-for-profit hospital group. Prior to his position with Via Caritas Health System, he served as President and Chief Executive Officer of SSM Healthcare Ministry Corp., a not-for-profit hospital group. Mr. Trunfio received his B.A. from St. John’s University (N.Y.) and holds a Ph.D. in Clinical Psychology from the University of Miami.

The Board has concluded that Mr. Trunfio should serve as a director due to his extensive executive management and leadership experience. Mr. Trunfio brings to the Board a depth of understanding of the delivery of healthcare delivery system in the United States, our business and the various challenges we face in the evolving healthcare industry.

Affirmative Determinations Regarding Director Independence and Other Matters

The Board of Directors observes all criteria for independence established by the Nasdaq Stock Market, or NASDAQ, under its applicable Listing Rules. As such, the Board of Directors has determined each of the following directors and nominees to be an “independent director” under the meaning of Rule 5605(a) (2) of the Nasdaq Listing Rules:

W. Larry Cash
Thomas C. Dircks
Gale Fitzgerald
Richard M. Mastaler
Mark Perlberg
Joseph A. Trunfio, PhD

The Board of Directors has also determined that each member of the Audit, Compensation and Governance and Nominating Committees meets the applicable independence requirements set forth by NASDAQ, the Commission and the Internal Revenue Service. The Board of Directors has further determined that W. Larry Cash, a member and Chairman of the Audit Committee, is an “audit committee financial expert” as defined in the rules promulgated by the Commission and, as such, Mr. Cash satisfies the requirements of Rule 5605(c)(2) of the Nasdaq Listing Rules.

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Board Committees and Meetings

Meetings of the Board of Directors. During the year ended December 31, 2016, there were 7 meetings of the Board of Directors. Each director who served in such capacity during the year ended December 31, 2016 attended 100% of the aggregate number of meetings of the Board of Directors (except for one director who attended 6 of the 7 meetings), and 100% of the committee or committees thereof on which he or she served (except for one director who attended 92% of the committee meetings for which he serves). All of the directors nominated for election to the Board were members of the Board for the entire 2016 year. It is the practice of the Board of Directors to have the independent directors meet in an executive session at each meeting of the Board. It is also our practice that all directors should attend the Annual Meeting of Stockholders. Six of the seven directors attended the 2016 Annual Meeting.

Board Leadership Structure and Role in Risk Oversight . Our Company is led by Mr. William J. Grubbs, who has served as our President and Chief Executive Officer since July 5, 2013. Our Board of Directors is currently comprised of Mr. Grubbs, our Chief Executive Officer, and six independent directors. Each of our Audit, Compensation and Governance and Nominating Committees are comprised entirely of independent directors. While risk management is primarily the responsibility of our management team, the Board is responsible for the overall supervision of our risk management activities which occurs at both the full Board level and at the committee level. Our Audit Committee also has the responsibility to, among other things, review with management, the Company’s policies regarding major financial risk exposures and the steps management has taken to monitor and control such exposures. The Audit Committee also reviews with management, the policies governing the process by which risk assessment and risk management are undertaken and has oversight for the effectiveness of management’s enterprise risk management process that monitors key business risks facing us. In addition to our Audit Committee, the other committees of the Board consider the risks within their areas of responsibility. For example, the Compensation Committee assesses risk that could result from the structure and design of our executive compensation programs, our incentive compensation plans, director compensation, perquisites and compliance with the Sarbanes-Oxley Act of 2002 regarding prohibitions on loans to executive officers and directors. The Governance and Nominating Committee evaluates risks with respect to, among other things, corporate governance matters and the background and suitability of director nominees. Additionally, the Board of Directors continually evaluates our risks related to liquidity, operations, credit, regulatory compliance and fiduciary risks, and the processes in place to monitor and control such exposures. Management also provides regular updates throughout the year to the respective committees regarding management of the risks they oversee, and each of these committees report their findings to the full Board, including any areas of risk that require Board attention. Additionally, the full Board reviews our short- and long-term strategies, including consideration of risks facing us and their potential impact.

The Board of Directors has determined that our current board leadership structure is appropriate and helps to ensure proper risk oversight for us for a number of reasons, the most significant of which are as follows:

our Chief Executive Officer is the individual selected by the Board of Directors to manage us on a day-to-day basis and his direct involvement in our operations makes him best positioned to consult with our Board to create appropriate agendas for Board meetings and determine the time allocated to each agenda item in discussions of our short- and long-term objectives, as well as lead productive strategic planning sessions with the Board;
members of the Board are kept informed of our business by various documents sent to them before each meeting and as otherwise requested, as well as through oral reports made to them during these meetings by our Chief Executive Officer, Chief Financial Officer and other senior executives;
our Board structure provides strong oversight by independent directors, in particular because non-management directors meet separately, the Board is advised of all actions taken by the various committees of the Board, they have full access to all of our books, records and reports;
members of the Board have direct access to the management team and those individuals are available at all times to answer questions from the Board Members;
our Board has extensive management experience in business and, in particular, the healthcare industry in which we operate; and

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the continuity and tenure of our Board provide a valuable source of institutional knowledge regarding our evaluation and current makeup.

Compensation-Related Risk. Our Board has specifically reviewed and considered whether our compensation programs and policies create risks that are reasonably likely to have a material adverse effect on us. In that regard, we design our programs in a balanced and diversified manner while also creating significant, yet appropriate, incentives for strong performance based on our business and strategic plan. In most cases, each component of our performance-based compensation program is subject to a limit on the amount paid. We believe that our compensation programs reflect a balance of short-term, long-term, guaranteed and performance-based compensation in order not to encourage excessive risk-taking. A significant portion of our compensation program includes performance-based compensation. We believe that this ensures that our NEOs and other employees focus on the health of our business and that will deliver stockholder value over time and discourages excess risk-taking by our NEOs and other employees.

Committees of the Board of Directors. Our Board of Directors has three standing committees: Audit, Compensation and Governance and Nominating Committees. Each of these committees is comprised solely of independent directors within the meaning of Rule 5605(a) (2) of the Nasdaq Listing Rules. Each committee operates pursuant to a committee charter. The charters of each of the Audit, Compensation and Governance and Nominating Committees are available on our website at www.crosscountryhealthcare.com by choosing the “Investors” link, clicking on the “Corporate Governance” section, and selecting the respective charter under “View.”

The current composition of our Board’s standing committees is as follows:

Audit Committee

The Audit Committee consists of Messrs. Cash and Mastaler and Ms. Fitzgerald. Mr. Cash joined the Audit Committee upon his appointment to the Board in October 2001; Ms. Fitzgerald joined the Audit Committee upon her appointment to the Board in May 2007; and Mr. Mastaler was appointed to serve on the Audit Committee, effective January 1, 2014. Mr. Cash is the Chairman of the Audit Committee. Messrs. Cash and Mastaler and Ms. Fitzgerald are independent directors under the Commission’s rules and NASDAQ’s Listing Rules for Audit Committees. The Audit Committee has adopted a written charter, which is available on our website as described under “Committees of the Board of Directors.” The Audit Committee is the principal agent of the Board of Directors in overseeing (i) the quality and integrity of our financial statements, (ii) legal and regulatory compliance, (iii) the independence, qualifications, and performance of our independent registered public accounting firm, (iv) the performance of our internal auditors and (v) the integrity of management and the quality and adequacy of disclosures to stockholders. The Committee also:

is responsible for hiring and terminating our independent registered public accounting firm and pre-approving all auditing, as well as any audit-related, tax advisory and any other non-auditing services to be performed by the independent registered public accounting firm;
reviews and discusses with our independent registered public accounting firm their quality control procedures and our critical accounting policies and practices;
regularly reviews the scope and results of audits performed by our independent registered public accounting firm and internal auditors;
meets with management to review the adequacy of our internal control framework and our financial, accounting, and reporting and disclosure control processes;
reviews our periodic filings and quarterly earnings releases;
reviews and discusses with our chief executive and financial officers the procedures they follow to complete their certifications in connection with our periodic filings with the Commission; and
discusses management’s plans with respect to our major financial risk exposures.

During 2016, there were 8 meetings of the Audit Committee. By meeting with independent auditors and internal auditors, and operating and financial management personnel, the Audit Committee oversees matters relating to accounting standards, policies and practices, any changes thereto and the effects of any changes on our financial statements, financial reporting practices and the quality and adequacy of internal controls.

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Additionally our Internal Audit function reports directly to the Audit Committee. The Audit Committee regularly meets with our independent registered public accounting firm separate from management and regularly holds executive sessions without management. In addition, the Audit Committee regularly meets with our Chief Financial Officer and Director of Internal Audit in separate executive sessions.

The Audit Committee has established procedures for (i) the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters, and (ii) the confidential, anonymous submission by employees of concerns regarding questionable accounting or auditing matters. A toll-free phone number is available for confidential and anonymous submission of concerns relating to accounting, auditing and other illegal or unethical matters, as well as alleged violations of the Company’s Code of Conduct or any other policies. All submissions are reported to the General Counsel and, in turn, to the Chairman of the Audit Committee. The Audit Committee has the power to retain independent counsel and other advisors as it deems necessary to carry out its duties.

The Board has determined that each member of the Audit Committee is able to read and understand fundamental financial statements, including our balance sheet, income statement and cash flow statement, as required by NASDAQ rules. In addition to determining that Mr. Cash is an “audit committee financial expert” under the Commission’s rules, the Board has determined that Mr. Cash satisfies the Nasdaq rule requiring that at least one member of the Audit Committee have past employment experience in finance or accounting, requisite professional certification in accounting, or any other comparable experience or background which results in the member’s financial sophistication, including being, or having been, a chief executive officer, chief financial officer or other senior officer with financial oversight responsibilities.

Compensation Committee

The role of the Compensation Committee includes (i) reviewing and approving corporate goals and objectives relevant to our Chief Executive Officer’s compensation, (ii) evaluating our Chief Executive Officer’s performance in light of the Company’s goals and objectives, and determining and approving our Chief Executive Officer’s compensation level based on this evaluation, and (iii) making recommendations to the Board with respect to compensation, incentive compensation plans and equity-based plans for all of our employees, including officers other than our Chief Executive Officer. The members of the Compensation Committee consist of Messrs. Trunfio, Cash and Perlberg who are independent directors under Rule 5605(a) (2) of the Nasdaq Listing Rules. Mr. Cash joined the Compensation Committee upon his appointment to the Board in October 2001 and Mr. Trunfio was appointed to the Compensation Committee as its Chairman, effective January 1, 2014. Mr. Perlberg was appointed to the Compensation Committee, effective May 12, 2015. During 2016, there were 5 meetings of the Compensation Committee. The Compensation Committee has adopted a written charter, which is available on our website as described under “Committees of the Board of Directors.”

The agenda for meetings of the Compensation Committee is determined by its Chairman with the assistance of our Chief Executive Officer. Compensation Committee meetings are regularly attended by our Chief Executive Officer and General Counsel, except for portions of the meetings with respect to voting or deliberation. The Compensation Committee’s Chairman reports the Committee’s recommendations on executive compensation to the Board of Directors.

Under its charter, the Compensation Committee has the authority and may, in its sole discretion, obtain advice and seek assistance from internal and external legal, accounting and other consultants. The Compensation Committee has the sole authority to select or receive advice from, and terminate a compensation consultant or other advisor to the Compensation Committee (other than in-house legal counsel) to assist in the evaluation of the compensation of our Chief Executive Officer, senior executives and directors, including sole authority to approve such firm’s fees and other retention terms, and we provide appropriate funding as determined by the Compensation Committee. In selecting advisers, the Compensation Committee will take into consideration certain independence factors.

During 2016, the Compensation Committee retained Pearl Meyer & Partners, LLC (“Pearl Meyer”) as its independent compensation consultant. In its role, Pearl Meyer rendered services specifically requested by the Compensation Committee, which included reviewing the pay of our executives and directors and making

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recommendations to and advising the Compensation Committee on compensation design and levels. The Compensation Committee assessed the independence of Pearl Meyer pursuant to the applicable Nasdaq and Commission requirement and concluded that no conflict of interest exists that would prevent Pearl Meyer from serving as its independent consultant.

Governance and Nominating Committee

The role of the Governance and Nominating Committee is to: (i) develop and recommend to the Board of Directors a set of corporate governance principles and review them at least annually; (ii) determine the qualifications for board membership and recommend nominees to the stockholders; and (iii) ensure a robust and effective performance evaluation process is in place for the Board, the CEO, and senior management, as well as an effective succession planning process for these positions.

The Amended and Restated Charter of the Governance and Nominating Committee is available on our website as described under “Committees of the Board of Directors.” Our Governance Guidelines are also available on our website at www.crosscountryhealthcare.com by choosing the “Investors” link, clicking on the “Corporate Governance” section, and selecting the guidelines under “View.” The Governance and Nominating Committee consists of Ms. Fitzgerald and Messrs. Trunfio and Mastaler, who are all independent directors under Rule 5605(a) (2) of the Nasdaq Listing Rules. Ms. Fitzgerald was appointed to the Governance and Nominating Committee as its Chairman, effective January 1, 2014; Mr. Trunfio has served on the Committee since October 2001; and Mr. Mastaler was appointed to the Committee, effective January 1, 2014.

The Board’s current policy with regard to the consideration of director candidates recommended by stockholders is that the Governance and Nominating Committee will review and consider any director candidates who have been recommended by stockholders in compliance with the procedures established from time to time by the Board (the current procedures are described below), and conduct inquiries as it deems appropriate. The Governance and Nominating Committee will consider for nomination any such proposed director candidate who is deemed qualified by the Governance and Nominating Committee in light of the minimum qualifications and other criteria for Board membership approved by the Board from time to time. To date, we have not received any recommendation from stockholders requesting that the Governance and Nominating Committee consider a candidate for inclusion among the Governance and Nominating Committee’s slate of nominees in our Proxy Statement.

Certain identification and disclosure rules apply to director candidate proposals submitted to the Governance and Nominating Committee by any single stockholder or group of stockholders that has beneficially owned more than five percent of Common Stock for at least one year, referred to as a Qualified Stockholder Proposal. If the Governance and Nominating Committee receives a Qualified Stockholder Proposal with the necessary notice, information and consent provisions as referenced above, the proxy statement to which the Qualified Stock Proposal referred will disclose the name of the proposed candidate and the stockholder (or stockholder group) who recommended the candidate and will also disclose whether or not the Governance and Nominating Committee chose to nominate the proposed candidate. However, no such disclosure will be made without the written consent of both the stockholder (or stockholder group) and the proposed candidate to be so identified. The procedures described in this paragraph are not meant to replace or limit stockholders’ general nomination rights in any way.

In considering director nominees, the Nominating Committee will consider the following:

the needs of the Company with respect to particular areas of specialized knowledge;
the relevant business experience of the nominee including any experience in healthcare, business, finance, accounting, administration or public service;
the personal and professional integrity of the nominee;
the nominee’s ability to commit the resources necessary to be an effective director of a public company, including the nominee’s ability to attend meetings; and
the overall balance of the Board.

Other than the foregoing, there are no stated minimum criteria for nominees, although the Governance and Nominating Committee may also consider other facts as it may deem are in the best interests of the Company and its stockholders.

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All stockholder recommendations for director candidates must be submitted to our legal department at 5201 Congress Avenue, Boca Raton, Florida, 33487, who will forward all recommendations to the Governance and Nominating Committee. All stockholder recommendations for director candidates must be submitted to us not less than 120 calendar days prior to the first anniversary of the date of our proxy statement released to stockholders in connection with the previous year’s Annual Meeting. All stockholder recommendations for director candidates must include the following information:

the name and address of record of the stockholder;
a representation that the stockholder is a record holder of our securities or, if the stockholder is not a record holder, evidence of ownership in accordance with Rule 14a-8(b) (2) of the Exchange Act;
the name, age, business and residential address, educational background, current principal occupation or employment, and principal occupation or employment for the preceding five full fiscal years of the proposed director candidate;
a description of the qualifications and background of the proposed director candidate that addresses the minimum qualifications and other criteria for Board membership approved by the Board from time to time;
a description of all arrangements or understandings between any stockholder and the proposed director candidate;
the consent of the proposed director candidate (i) to be named in the proxy statement relating to our Annual Meeting of Stockholders and (ii) to serve as a director if elected at such Annual Meeting; and
any other information regarding the proposed director candidate that is required to be included in a proxy statement filed pursuant to the rules of the Commission.

There have been no changes to the procedures by which stockholders may recommend nominees to our Board of Directors since our last disclosure of such procedures, which appeared in the definitive proxy statement for our 2016 Annual Meeting of Stockholders.

The Governance and Nominating Committee is responsible for identifying and evaluating individuals qualified to become Board members, including nominees recommended by Stockholders, and recommending to the Board the persons to be nominated by the Board for election as directors at the Annual Meeting of Stockholders and the persons to be elected by the Board to fill any vacancies on the Board. Director nominees are selected by the Governance and Nominating Committee in accordance with the policies and principles in its charter and the criteria set forth above. There are no differences in the manner in which the Governance and Nominating Committee evaluates director nominees recommended by stockholders and a candidate that has been initially recommended by the Governance and Nominating Committee. The Nominating Committee has the authority to retain a search firm to identify or evaluate or assist in identifying and evaluating potential nominees.

During 2016, there were 2 meetings of the Governance and Nominating Committee.

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COMPENSATION COMMITTEE INTERLOCKS AND
INSIDER PARTICIPATION

The members of the Compensation Committee are Messrs. Trunfio, Cash and Perlberg. During 2016:

no officer (or former officer) or employee of the Company or any of its subsidiaries served as a member of the Compensation Committee;
none of the members of the Compensation Committee had a direct or indirect material interest in any transaction in which the Company was a participant and the amount involved exceeded $200,000, except that W. Larry Cash is the President of Financial Services and Chief Financial Officer of Community Health Systems and, during our fiscal year ended December 31, 2016, we provided healthcare staffing services to Community Health Systems resulting in revenues to us of $5,013,396;
none of our executive officers served on the Compensation Committee (or another Board committee with similar functions or, if there was no such committee, the entire Board of Directors) of another entity where one of that entity’s executive officers served on our Compensation Committee;
none of our executive officers was a director of another entity where one of that entity’s executive officers served on our Compensation Committee; and
none of our executive officers served on the Compensation Committee (or another Board committee with similar functions or, if there was no such committee, the entire Board of Directors) of another entity where one of that entity’s executive officers served as a director on our Board.

Director Compensation and Other Arrangements

In 2016, each independent director received an annual retainer of $60,000; the Chairman of the Board received an additional annual retainer of $50,000; the Chairman of the Audit Committee received an additional annual retainer of $20,000; the Chairman of the Compensation Committee received an additional annual retainer of $15,000; and the Chairperson of the Governance and Nominating Committee received an additional annual retainer of $10,000. No payments were made for committee member services in 2016. In accordance with the 2014 Omnibus Incentive Plan, Messrs. Cash, Dircks, Mastaler, Perlberg, Trunfio and Ms. Fitzgerald also received a grant of restricted shares of Common Stock on June 1, 2016, the first day of the month following our Annual Meeting. Each such grant consisted of a number of shares of restricted Common Stock equal to approximately $100,000, based on the closing price of our Common Stock on the date of grant. Directors are required to hold an amount of the Company’s common stock equal to two times the annual cash retainer, which amount may be accumulated over three years. All directors are also reimbursed for the expenses they incur in attending meetings of the Board or Board committees.

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2016 DIRECTOR COMPENSATION TABLE

The following table provides compensation information for our directors in 2016, except for Mr. Grubbs, our President and Chief Executive Officer. Compensation received by Mr. Grubbs is included in the Summary Compensation Table on page 28 of this proxy statement.

Name
Fees
Earned
or Paid
in Cash
($)
Stock
Awards
($)(1)
Total
($)
W. Larry Cash
 
80,000
 
 
100,000
 
 
180,000
 
Thomas C. Dircks
 
110,000
 
 
100,000
 
 
210,000
 
Gale Fitzgerald
 
70,000
 
 
100,000
 
 
170,000
 
Richard M. Mastaler
 
60,000
 
 
100,000
 
 
160,000
 
Mark Perlberg
 
60,000
 
 
100,000
 
 
160,000
 
Joseph A. Trunfio PhD
 
75,000
 
 
100,000
 
 
175,000
 
(1) Amounts in this column reflect the aggregate grant date fair value of awards of restricted stock granted under our 2014 Omnibus Incentive Plan and computed in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 718, Compensation-Stock Compensation (ASC Topic 718). The aggregate grant date fair value per share of restricted stock granted on June 1, 2016 was $13.77. Based on a grant date fair value of approximately $100,000, the actual number of shares of restricted stock granted to each Director was 7,263. Restricted Shares outstanding as of December 31, 2016 for each non-employee director were as follows: Mr. Cash: 21,992; Mr. Dircks: 21,992; Ms. Fitzgerald: 21,992; Mr. Mastaler: 21,992; Mr. Perlberg: 13,576 and Mr. Trunfio: 21,992.

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EXECUTIVE OFFICERS

The following table sets forth certain information with respect to our current executive officers other than Mr. Grubbs whose information is provided as part of Proposal I:

Name
Age
Position
Daniele Addis, MBA
57
SVP, Business Services
Vickie L. Anenberg
52
President, Cross Country Staffing
Susan E. Ball, JD, MBA, RN
53
EVP, General Counsel and Secretary
William J. Burns, MBA, CPA
47
EVP, Chief Financial Officer and Principal Accounting Officer
Deborah Dean
56
SVP, Sales and Marketing
Dennis Ducham
57
President, Mediscan
Timothy Fischer
49
President, Medical Doctor Associates
William G. Halnon
58
Chief Information Officer
Ronni R. Morrison
58
SVP, Chief Human Resource Officer
Buffy Stultz White
43
SVP, Recruiting Strategy and Operations

Daniele Addis has served as Senior Vice President, Business Services since January 29, 2014. From September 2011 to January 2014, Ms. Addis was Senior Vice President, Shared Services of Randstad Professionals, a staffing company. Prior to that, she was Vice President, Shared Services and held various other positions at SFN Group, Inc. From January 1998 to January 2006, Ms. Addis was Senior Finance Manager of Office Depot, Inc. Ms. Addis holds a Bachelor in Business from Ecole Superieure de Commerce, Nantes, France, a Master of Arts in Economics from George Mason University and a Master of Business Administration from Jacksonville University.

Vickie L. Anenberg has served as President of Cross Country Staffing since May 8, 2012. From January 2006 to May 8, 2012, she served as Executive Vice President of Cross Country Staffing. Ms. Anenberg previously served as President of Cross Country Staffing from August 2002 to December 2005. Prior to that, she served as Vice President of our then Nursing Division since 1995. Prior to joining Cross Country Staffing in 1990, she worked at Proctor & Gamble since 1986.

Susan E. Ball, JD, MBA, RN has served as an Executive Vice President of the Company since January 1, 2017, as General Counsel since May 2004 and Secretary since March 2010. Prior to that, Ms. Ball served as our Corporate Counsel from March 2002 to May 2004. Ms. Ball also served as a Director of Jamestown Indemnity, Ltd. from September 2008 until its liquidation in the third quarter of 2015. Before joining us, Ms. Ball practiced law at Gunster, Yoakley & Stewart, P.A. from November 1998 to March 2002 and at Skadden, Arps, Slate, Meagher and Flom from 1996 to November 1998. Prior to practicing law, Ms. Ball was a registered nurse. Ms. Ball received her B.S. degree in Nursing from The Ohio State University, her Juris Doctor degree from New York Law School, and her Masters of Business Administration from Florida Atlantic University.

William J. Burns was appointed Chief Financial Officer, effective April 1, 2014, and Principal Accounting Officer, effective December 1, 2014. He has served as an Executive Vice President of the Company since January 1, 2017. Prior to joining the Company, Mr. Burns served as Group Vice President and Corporate Controller for Gartner, Inc., a technology research and advisory firm, since 2008. From 2006 until 2008, Mr. Burns was the Chief Accounting Officer for CA Technologies, Inc. Mr. Burns earned his B.A. in Accounting and Information Systems from Queens College in 1992 and a Masters of Business Administration from New York University’s Stern School of Business in 2000. Mr. Burns is a Certified Public Accountant.

Deborah Dean has served as Senior Vice President, Sales and Marketing since June 20, 2013. Prior to joining the Company, Ms. Dean served as the Vice President of Sales of Vision IT from January 2012 to May 2013. She served as the Senior Vice President, Strategic Accounts for Spherion Staffing Services from May 2006 to November 2011. From November 2001 to March 2006, Ms. Dean served as the Vice President of Sales for Spring Group Plc. Ms. Dean holds her B.A. in English from Alma College.

Dennis Ducham has served as President of New Mediscan II, LLC since October 30, 2015 when it and its affiliates were acquired by the Company. Prior to joining the Company, from 2012 through June 2015,

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Mr. Ducham served as President and Chief Executive Officer of Mediscan, Inc. and its affiliates. From January 2004 through December 2011, Mr. Ducham served as Chief Executive Officer of Global Recruiters Network, Pleasanton. Mr. Ducham holds a B.S. in Economics from Michigan State University.

Timothy Fischer has served as President of MDA Holdings, Inc. since April 2016. Prior to joining MDA, from 2014 through January 2016, Mr. Fischer served as Chief Operating Officer at Mitchell Martin, Inc., a talent acquisition solutions firm. From 2013 to 2014, Mr. Fischer served as Senior Vice President and led the integration of his prior employer, RCG Global Services, into Stefanini. Mr. Fischer was President of RCG Staffing from 2009 to 2013. Mr. Fischer holds a B.S. in Business Administration from Culver-Stockton College.

William G. Halnon has served as Chief Information Officer since February 2017. Prior to joining the Company, from February 2016 to February 2017, Mr. Halnon served as President of Albedon Digital, Inc. From January 2007 to February 2016, Mr. Halnon served as Senior Vice President and Chief Information Officer of Republic Services, Inc. and, from January 2005 to January 2007, he served as Senior Vice President and Chief Information Officer of Spherion, Inc. Mr. Halnon holds a B.A. in Accounting from Langston University.

Ronni R. Morrison has served as Cross Country Healthcare, Inc.'s Senior Vice President and Chief Human Resource Officer since March 31, 2017. From January 2011 to November 2016, and from July 2006 to January 2011, respectively, Ms. Morrison served as Senior Vice President, Human Resources and Vice President, Human Resources of Starboard Cruise Services. Prior to that, Ms. Morrison held various human resource positions at Pier I Imports from 1985 to 2006. Ms. Morrison earned her B.S. degree in Industrial and Labor Relations from Cornell University and a Masters of Business Administration from Southern Methodist University.

Buffy Stultz White has served as Senior Vice President, Recruiting Strategy and Operations since September 30, 2016. Before joining Cross Country Healthcare, Inc., Ms. White served as Executive Vice President, Global Services and Solutions Consulting, of Pontoon (a division of Adecco) from June 2015 to November 2015. Ms. White served in various capacities at Pontoon and Adecco since 2006 and prior to that, in various roles at SFN Group, Inc. from August 2001 to July 2006.

COMPENSATION DISCUSSION AND ANALYSIS

This Compensation Discussion and Analysis is designed to provide our shareholders with a clear understanding of our compensation philosophy and objectives, compensation-setting process, and the 2016 compensation of our named executive officers, or NEOs. As discussed in Proposal IV, we are conducting a Say-on-Pay vote this year that requests your approval, on an advisory basis, of the compensation of our NEOs as described in this section and in the tables and accompanying narrative. As discussed in Proposal V, we are also conducting a frequency vote this year requesting that you indicate whether we should hold the Say-on-Pay vote every 1, 2 or 3 years.

Our NEOs for 2016 are:

William J. Grubbs, President and Chief Executive Officer
William J. Burns, Executive Vice President, Chief Financial Officer and Principal Accounting Officer
Christopher R. Pizzi, Former Acting Chief Financial Officer
Vickie L. Anenberg, President, Cross Country Staffing
Susan E. Ball, Executive Vice President, General Counsel and Secretary
Paul Tymchuk, Chief Information Officer

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EXECUTIVE SUMMARY

2016 Business Performance Highlights

We are a national leader in providing healthcare staffing, recruiting and value-added workforce solutions. Through a full suite of innovative workforce solutions and a national presence including 74 office locations throughout the United States, we are able to meet the unique and dynamic needs of our clients. By utilizing our various solutions, clients are able to better plan their personnel needs, outsource recruitment processes, strategically flex their workforce, streamline their purchasing needs, access specialties not available in their local area, access quality healthcare personnel and provide continuity of care for improved patient outcomes. Our solutions are geared towards assisting our clients in solving their labor issues while maintaining high quality outcomes.

Over the past four years we have added nearly $400 million of revenue and increased our Adjusted EBITDA* (a non-GAAP financial measure) from $4 million to $45 million. In 2016, we won twenty-four Managed Service Programs (MSPs) and, through March 2, 2017, we have won ten (10) more. During 2016, we had more than 27,500 healthcare professionals on assignment at over 6,700 facilities. Our Managed Service Programs served more than 2,100 facilities.

We achieved solid performance in 2016. A summary of key highlights that occurred during 2016 include:

We grew revenue for the year ended December 31, 2016 to $833.5 million (or a 9% increase). We grew Adjusted EBITDA* to $44.7 million (or a 19% year-over-year increase). In addition, our Adjusted EPS* (a non-GAAP financial measure) for the year ended December 31, 2016 was $0.69 compared to $0.54 in 2015.
On December 1, 2016, we completed the acquisition of USr Healthcare to expand our RPO business.
For purposes of our annual incentive program, our financial performance was within the performance range established by the Compensation Committee, therefore entitling our NEOs to incentive compensation award payouts.

2016 Compensation Highlights

Base Salary: Base salaries for certain executive officers were raised approximately 10% in an effort to keep our NEOs benchmarked at median levels.
Annual Incentives: Based on 2016 results, our bonuses were paid out at between 61% and 79% of target for the 2016 year.
Long Term Incentives: Based on 2016 Adjusted EPS of 83.8% of target, 48.1% of our Performance-based Share Awards (PSAs) were issued as of March 22, 2017.

Pay for Performance

We pay for performance. The core of our executive compensation philosophy is that our executives’ pay should be linked to the performance of Cross Country Healthcare. Accordingly, our executives’ compensation is heavily weighted toward compensation that is performance-based or equity-based. Our NEO compensation for 2016 reflects this commitment.

* See Annex A of this proxy statement for a reconciliation of non-GAAP financial measures to our results as reported under GAAP.

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Good Governance

What we do
What we don’t do
☑ Majority of compensation incentive-based and at risk tied to company performance
X No guaranteed incentive payments
☑ Engage independent compensation consultants
X No 280G excise tax gross-ups
☑ Engage in peer group benchmarking
X No pension or retirement plans
☑ Due diligence in setting compensation targets and goals
X No option repricing
☑ Periodically assess the compensation programs to ensure that they are not reasonably likely to incentivize employee behavior that would result in any material adverse risks to the company
X Perquisites are not a substantial portion of our NEO pay packages
☑ Provide reasonable severance protection with double trigger protections upon a change in control
X No hedging or pledging
☑ Clawbacks of equity and cash compensation in the event of a restatement
 
☑ Robust stock ownership guidelines
 

Consideration of Shareholder Advisory Vote

As part of its compensation setting process, the Committee also considers the results of the prior year’s shareholders advisory vote on our executive compensation to provide useful feedback regarding whether shareholders believe the Committee is achieving its goal of designing an executive compensation program that promotes the best interests of the Company and its shareholders by providing its executives with the appropriate compensation and meaningful incentives. For the sixth straight year, our 2015 executive compensation program received substantial shareholder support and was approved, on an advisory basis, by 98.4% of the votes cast at the 2016 annual stockholder meeting. Our Compensation Committee believes that this vote reflected our shareholders’ strong support of the compensation decisions made by the Committee for our NEOs for 2016.

COMPENSATION PHILOSOPHY AND OBJECTIVES

The philosophy of our executive compensation program is to align pay with performance, keep overall compensation competitive and ensure that we can recruit, motivate and retain high quality executives. Accordingly, our executives’ compensation is heavily weighted toward compensation that is performance-based or equity-based. Our NEO compensation for 2016 reflects this commitment. Our executives’ compensation for 2016 consisted of a base salary, an annual incentive bonus and long-term equity awards (50% of which are time vested over three years and 50% of which are performance-based, with earned shares subject to a two-year cliff vest). For 2016, 75% of our CEO’s target total compensation and an average of 57% of our other NEO’s target total compensation was performance-based or equity-based. We do not provide pension, supplemental retirement benefits or material perquisites to our executives as they are not tied to performance.

The three principles of our compensation philosophy are as follows:

Total direct compensation levels should be sufficiently competitive to attract, motivate and retain the highest quality executives.    Our Committee seeks to establish target total direct compensation (base salary, short-term and long-term incentive) at the 50 th percentile of our Peer Group and market data of companies of like size, thereby providing our executives the opportunity to be competitively rewarded for our financial, operational and stock price growth. It is also the Committee’s intention to set total executive compensation sufficiently high to attract and retain strong, motivated leadership who will not only strive to reach our key operating and strategic objectives, but also demonstrate the utmost integrity in doing so.

Performance-based compensation should constitute a substantial portion of total compensation.    We believe in a pay-for-performance culture, with a significant position of total direct compensation being performance -based and/or “at risk.” The performance of our executives, considered in light of general economic and specific company, industry and competitive conditions, serves as the primary basis for determining their overall

19

compensation. Accordingly, a portion of the compensation provided to our executive officers is tied to, and varies with, our financial and operational performance, as well as individual performance. We view our short-term and long-term components of the compensation program as being “at risk.”

Long-term incentive compensation should align executives’ interests with our shareholders’ interest to further the creation of long-term shareholder value.    Awards of equity-based compensation encourage executives to focus on our long-term growth and prospects and incentivize executives to manage the Company from the perspective as owners with a meaningful stake, and to encourage them to remain with us for long and productive careers. Our stock ownership guidelines further enhance the incentive to create long-term shareholder value. Equity-based compensation also subjects our executives to market risk similar to our shareholders.

This philosophy serves as the basis of the Committee’s decisions regarding each of the following three components of pay: base salary, short-term (annual) incentive compensation and long-term (equity) compensation, each of which is discussed below.

THE ROLE OF THE COMPENSATION COMMITTEE, MANAGEMENT AND CONSULTANTS AND THE COMPENSATION SETTING PROCESS

The Committee is comprised solely of independent directors and is responsible for determining the compensation of our CEO and other NEOs. The Committee receives assistance from its independent compensation advisor, which was Pearl Meyer, and from our CEO (with respect to NEO compensation other than his own).

Annually, the Committee evaluates the Company’s executive and director compensation design, competitiveness and effectiveness. In 2016, the Committee engaged Pearl Meyer to review the compensation components for our NEOs against our 2016 Peer Group and market data of like-sized companies, assist in the determination of the 2016 compensation for our NEOs, and provide recommendations for our director compensation program. Pearl Meyer does not perform any other services for the Company other than its consulting services to the Committee and is deemed to be independent and conflict-free under relevant stock exchange standards.

Our NEO compensation program is implemented yearly and it coincides with the completion of our annual financial statement audit and release of annual earnings, as well as the approval of the budget for the then current year. Annual cash incentives earned for the prior year, if any, are determined by the Committee and paid out at that time. Current year target objectives are also established at that time and any adjustments to base salaries are typically determined by the Committee at that time.

When making NEO compensation decisions, the Committee takes many factors into account, including the economy, the NEO’s performance, expected future contributions to the Company’s success, the financial and operational results of individual business units, our financial and operational results as a whole, the NEO’s historical compensation, and any retention concerns. As part of the process, the CEO provides the Committee with his assessment of the NEOs’ performance and other factors used in developing his recommendation for their compensation, including salary adjustments, cash incentives and equity grant guidelines for the then current year. In looking at historical compensation, the Committee looks at the progression of salary increases over time, an NEO’s ability to meet targets in prior years, the value inherent in equity awards to be granted to complete the total compensation program for an NEO for a particular year, economic outlook and our stock performance. The Committee uses the same general factors in evaluating the CEO’s performance and compensation as it uses for the other NEOs.

Upon receipt of this information, the Committee discusses proposed compensation plans for the CEO and other NEOs in detail. Based on our Governance Guidelines, the Committee is required to annually approve the goals and objectives for compensating the CEO and other NEOs, evaluate their performance in light of these goals before setting their salaries, bonus and other incentive and equity compensation. The Committee adjusts the cash incentive portion of the NEOs’ compensation consistent with its philosophy to incentivize and reward executives to reach certain financial and strategic objectives and reward them based upon their performance. The Committee believes that maintaining the flexibility to make upward or downward adjustments to the various components of the NEOs compensation programs allows the Committee to appropriately provide incentives to individuals and further aligns the NEOs with the objectives of our stockholders.

20

THE ROLE OF BENCHMARKING

At the beginning of the executive compensation setting process each year, the Committee, in consultation with its independent compensation consultant, determines the process by which it will work to ensure that the Company’s compensation is competitive. For fiscal 2016, the Committee, in consultation with its independent compensation consultant, identified the process by which it will work to ensure that our executive compensation is competitive. For 2016, the Compensation Committee selected, with the recommendation of Pearl Meyer, a group of peer companies from both the healthcare staffing and general staffing industry, including the following 11 companies: AMN Healthcare Services, Inc., On Assignment, Inc., KForce, Inc., TrueBlue, Inc., CDI Corp., Hudson Global, Korn/Ferry International, Volt Information Sciences, Inc., Heidrick & Struggles International Inc., GP Strategies Corp., and Barrett Business Services, Inc. (the “2016 Peer Group”). The Compensation Committee decided to use companies from these two staffing industries as it believes that each of these two industries have business characteristics that are similar to our business. The number of companies in the 2016 Peer Group was revised to reflect the increased size of the Company compared to the year earlier and to increase the sample size.

Each 2016 Peer Group company is comparable to the Company in certain respects, however, factors such as revenue, business mix, as well as the way the companies structure their top management also affect executive compensation. The Committee looked at the practices of the 2016 Peer Group and used their compensation levels as an indicator of the competitive market for our executives for fiscal year 2016.

Generally, our policy has been to pay our NEOs base salaries at the 50th percentile of our Peer Group. Incentive payouts, at a reduced level, begin upon achievement of a predetermined percentage of targeted objectives (generally 80% or higher for EBITDA and 95% for revenue) which can vary from year to year and from one performance metric to another, so that there is not a disincentive to the NEOs. Payouts may exceed 100% if the performance exceeds 100% of the target objective as set forth in the table on page 22 . We believe that an “all or nothing” approach could provide a disincentive compared to our tiered payout approach that is better aligned with our overall operating objectives, and ensures that pay varies in proportion to performance. In determining competitive compensation levels for the NEOs, the Committee takes into account their responsibilities, past performance, external market practices and the economy.

COMPONENTS OF 2016 NEO PAY PROGRAM

The Committee uses various compensation elements to provide an overall competitive total compensation and benefits package to the NEOs that is tied to creating stockholder value, is commensurate with our financial results and aligns with the business strategy. The Committee’s specific rationale, design, reward process and relating information are outlined below.

Base Salary

We provide the NEOs with a base salary to compensate them for services rendered during the fiscal year. Base salary ranges for NEOs are determined on the basis of each executive’s position, performance and level of responsibility. Base salary levels are currently reviewed at a minimum of every two years or earlier if the scale and scope of responsibilities and accountabilities for a NEO change. Peer group and market data from like sized companies are utilized in our review. Our practice does not include annual merit increases for NEOs. Base salaries for NEOs are generally benchmarked within a tight range of the market median for our peer groups and companies of like size. Commencing in 2017, base salaries for all of our NEOs will be reviewed annually.

Annual Cash Incentive Program

The annual cash incentive program is a core component of our “pay-for-results” philosophy. The program is heavily weighted to our financial results or relevant business units and the goals are closely linked to business strategy. The components of this program have historically included the incentive and reward opportunity (expressed as a percentage of base salary) and performance measures determined by the Committee, such as: revenue, Adjusted EBITDA, segment contribution income, Adjusted earnings per share (EPS) or Pre-Tax Income. To ensure the integrity of the goals and minimize the risk of unanticipated outcomes, each goal has had a performance range built around it with a commensurate increase or decrease in the associated award opportunity. The Committee may adjust performance measures for certain special, unusual or non-recurring items at its sole discretion.

21

Historically, the Committee has established performance goals and the weighting of each goal during its first Committee meeting each year. The process for setting the goals begins with the management team establishing preliminary goals based on prior year’s results, the budget, strategic initiatives, industry performance and projected economic conditions. The Committee assesses the difficulty of the goals and their implications for share price appreciation, revenue growth and other related factors. The iterative process results in final goals presented by management to the Committee at its March meeting.

Incentives and Award Opportunities.    Each annual target cash incentive award opportunity is expressed as a percentage of base salary, which may be earned based on both the achievement of certain financial objectives (the “Objective Bonus” component) and subjective considerations (the “Subjective Bonus” component). If results fall below pre-established threshold levels, no cash award is payable under the Objective Bonus component, although a Subjective Bonus may still be paid at the discretion of the Committee. If results exceed pre-established outstanding goals, the cash award payable under the Objective Bonus component is capped at a maximum award opportunity. The Committee believes that having a maximum cap serves to promote good judgment by the NEOs, reduce the likelihood of windfalls and makes the maximum cost of the plan predictable. The award opportunity is established for each position with the desired emphasis on pay at risk (more pay at risk for more senior executives) and internal equity (comparably positioned executives should have comparable award opportunities).

The Subjective Bonus opportunity is capped at a maximum amount, expressed as a percentage of base salary, which may vary for each position. The use of subjective criteria requires the Committee to weigh a multitude of subjective factors relative to specific responsibilities. This process allows the Committee to evaluate performance and to recognize contributions in light of our changing needs.

The table below sets forth the percentages of the portion of the 2016 annual incentive bonus that was payable upon achievement of the minimum, target and maximum levels (with interpolation between levels) of the performance metrics set forth in the table below for each of our NEOs.

Performance
Metric
Attainment Range
(Minimum/Target/Maximum)
Payout Percentage*
(Minimum/Target/Maximum)
% of Annual Incentive by Performance Metric
Grubbs
Burns
Ball
Tymchuk
Pizzi
Anenberg
Company Annual Revenue
95%/100%/105%
20%/100%/180%
20%
20%
20%
20%
20%
7.5%
Company Annual Adjusted EBITDA
80%/100%/120%
20%/100%/180%
60%
60%
60%
60%
60%
22.5%
CCS Revenue
95%/100%/105%
20%/100%/180%
n/a
n/a
n/a
n/a
n/a
12.5%
CCS Contribution Income
80%/100%/120%
20%/100%/180%
n/a
n/a
n/a
n/a
n/a
37.5%
Individual Objectives
n/a
20%/100%/180%
20%
20%
20%
20%
20%
20%
Total
 
 
100%
100%
100%
100%
100%
100%
* Except for Mr. Pizzi’s payout percentage, which was 50%/100%/150%.

As the President of Cross Country Staffing (“CCS”), Ms. Anenberg is responsible for the performance of the Company’s Nurse and Allied Staffing business segment (other than Mediscan) which represented approximately 81% of the Company’s total revenue for the full year in 2016. Accordingly, the Committee designs her annual incentive bonus to focus on the short-term financial, operational, and qualitative performance metrics that the Committee believes will be the basis of long-term growth for both CCS and the Company. For 2016, Ms. Anenberg’s annual incentive bonus was therefore partially based on CCS contribution income and revenue.

The annualized Company Adjusted EBITDA (a non-GAAP financial measure) and annualized Company revenue targets for the NEOs for 2016 were $51.4 million and $854.6 million, respectively. See Annex A of this proxy statement for a reconciliation of non-GAAP financial measures to our results as reported under GAAP.

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Determination of 2016 Annual Incentive Bonus Payments

The Committee determined that, for 2016, the Company achieved annualized Adjusted EBITDA of $44.7 million and annualized revenue of $833.5 million, after consideration of certain other unusual items outside the reasonable control of management. These amounts were 87.0% and 97.5% of the target level, respectively, and above the threshold levels. The Committee also determined for Ms. Anenberg that CCS achieved segment contribution income of $68.7 million and segment revenue of $674.1 million, after consideration of certain unusual items outside of the reasonable control of Ms. Anenberg. These amounts were 98.1% and 98.4% of their target levels, respectively. Set forth below are the annual incentive bonuses earned by the NEOs for 2016.

 
Target Bonus
Opportunity
Annual Incentive Bonus Earned
NEOs
% of Base
Salary
$
% of Target
Bonus
Opportunity
Earned
Individual
Objectives
Achieved
$
William J. Grubbs
 
100
%
 
685,000
 
 
61.0
%(1)
 
100.0
%
 
437,564
(4)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
William J. Burns
 
70
%
 
308,000
 
 
61.0
%(1)
 
100.0
%
 
207,751
(4)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Susan E. Ball
 
60
%
 
201,000
 
 
61.0
%(1)
 
100.0
%
 
142,526
(4)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Paul Tymchuk
 
45
%
 
123,750
 
 
   (2)
 
   (2)
 
(2)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Vickie L. Anenberg
 
65
%
 
260,000
 
 
79.2
%(3)
 
100.0
%
 
205,953
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Christopher R. Pizzi
 
40
%
 
88,000
 
 
75.6
%(1)
 
100.0
%
 
66,527
 
(1) Based on Adjusted EBITDA and revenue, and achievement of individual objectives at 100%.
(2) Mr. Tymchuk left the Company prior to the payment of the incentive bonus.
(3) In addition to components referenced in (1), Ms. Anenberg’s bonus was also based on contribution income and revenue of CCS.
(4) Includes a $20,000 discretionary bonus.

Long-Term Incentive Compensation

The Company uses equity-based awards to focus executives on long-term performance, to align executives’ financial interests with those of shareholders and to create retention platforms for key executives. Equity-based awards for NEOs are generally made based on the executive’s position, experience and performance, prior equity-based compensation awards and competitive equity-based compensation levels. Further, the Committee determines the terms and conditions of equity grants taking into account market practices and the objectives of the compensation program. Retaining key talent is a key factor for the Committee in considering the level of equity awards and the vesting schedule. The Committee may make grants of equity awards at such times during the year as it deems appropriate.

In 2016, 50% of the equity awards granted to the NEOs were in the form of time-based Restricted Share Awards (RSAs) and 50% were in the form of Performance-based Share Awards (PSAs) under our 2014 Omnibus Stock Incentive Plan (referred to as the Plan). Since 2014, the Company issued PSAs instead of Stock Appreciation Rights (SARs) since PSAs more closely tie compensation to specific financial performance goals and incentivizes management to focus their efforts on maximizing shareholder value.

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The Committee approves a number of RSAs and a target number of PSAs for the NEOs to be granted on March 31 st of each year. In 2016, the grant date values are set forth below and were based on the closing price on the grant date.

Name
Grant Date Value of
Restricted
Share Awards
(per share)
Number of
Restricted
Share Awards
Grant Date Value of
Performance Share
Awards at Target
(per share)
Target
Number of
Performance
Share Awards
William J. Grubbs
$
11.63
 
 
58,900
 
$
11.63
 
 
58,900
 
William J. Burns
$
11.63
 
 
17,025
 
$
11.63
 
 
17,025
 
Vickie L. Anenberg
$
11.63
 
 
15,477
 
$
11.63
 
 
15,477
 
Susan E. Ball
$
11.63
 
 
10,082
 
$
11.63
 
 
10,082
 
Paul Tymchuk
$
11.63
 
 
7,094
 
$
11.63
 
 
7,094
 
Christopher R. Pizzi
$
11.63
 
 
3,612
 
$
11.63
 
 
3,612
 

All of the RSAs granted to the NEOs in 2016 provide for vesting of 33 and 1/3% of the award on each of the first, second and third anniversaries of the grant date, subject to the NEO’s continued employment through the vesting date. The PSAs granted to the NEOs in 2016 provide for the issuance of a number of restricted shares based on the level of attainment of Adjusted EPS (a non-GAAP financial measure) for 2016 as follows:

Performance Level
Adjusted Earnings Per Share Achieved
($000s)
Percentage of the
Target Shares Earned
Below Threshold
Less than $0.62
0%
Threshold
$0.62
20%
Target
$0.83
100%
Maximum
$0.91
120%

Any restricted shares issued under the PSA would vest on December 31, 2018, subject to the NEO’s continued employment through such date. Our Adjusted EPS, as approved by the Committee, was $0.69, which was 83.8% of target, and resulted in 48.1% of the PSAs being issued on March 22, 2017. See Annex A of this proxy statement for a reconciliation of non-GAAP financial measures to our results as reported under GAAP.

OTHER COMPENSATION AND BENEFITS

Deferred Compensation Plan

We maintain the Deferred Compensation Plan, an unfunded non-qualified deferred compensation arrangement, intended to comply with Section 409A of the Internal Revenue Code of 1986, as amended, or the Code. Designated executives, including our NEOs, may elect to defer the receipt of a portion of their annual base salary, bonus and commission to our Deferred Compensation Plan. We may also make a discretionary contribution to the Deferred Compensation Plan on behalf of certain participants, which generally becomes vested three years from the date such contribution is made to the plan, upon the occurrence of a change in control or upon a participant’s retirement, death during employment or disability. Generally, payments under the Deferred Compensation Plan automatically commence upon a participant’s retirement, termination of employment or death during employment. Under certain limited circumstances described in the Deferred Compensation Plan, participants may receive distributions during employment. To enable us to meet our financial commitment under the Deferred Compensation Plan, assets may be set aside in a corporate-owned vehicle, which assets remain available to all our general creditors in the event of our insolvency. Participants of the Deferred Compensation Plan are our unsecured general creditors with respect to the Deferred Compensation Plan benefits. Currently, none of our NEOs have any amounts deferred under the Deferred Compensation Plan and no discretionary contributions were made to the plan in 2016.

24

401(k) Plan

We maintain a 401(k) plan. The plan permits eligible employees to make voluntary, pre-tax contributions to the plan up to a specified percentage of compensation, subject to applicable tax limitations. We may make a discretionary matching contribution to the plan equal to a pre-determined percentage of an employee’s voluntary, pre-tax contributions and may make an additional discretionary profit sharing contribution to the plan, subject to applicable tax limitations; provided, however, that NEOs and other executive officers are no longer eligible to participate in our 401(k) plan effective January 2017. Other eligible employees who elect to participate in the plan are generally vested in any matching contribution after three years of service with us and fully vested at all times in their employee contributions to the plan. The plan is intended to be tax-qualified under Section 401(k) of the Code, so that contributions to the plan and income earned on plan contributions are not taxable to employees until withdrawn from the plan, and so that our contributions, if any, will be deductible by us when made. Our 401(k) matching contribution has a matching contribution rate equal to 25% of the first 6% of compensation contributed to the plan by eligible participants during each payroll period.

Other Benefits

Executives participate in the health and dental coverage, company-paid term life insurance, disability insurance, paid time off and paid holidays programs applicable to other employees in their locality. These benefits are designed to be competitive with overall market practices and are in place to attract and retain the necessary talent in the business.

Employment Agreements

On March 20, 2013, we entered into an employment agreement with William J. Grubbs pursuant to which, on April 1, 2013, Mr. Grubbs became our President and Chief Operating Officer. On July 5, 2013, Mr. Grubbs became our Chief Executive Officer. The initial term of that agreement expired on March 31, 2016, and we entered into a new employment agreement with Mr. Grubbs on March 9, 2016. Mr. Grubbs’ base salary was $500,000 during the period in which he served as President and Chief Operating Officer, and was increased to $550,000 per year on July 5, 2013 when he became the Chief Executive Officer. His salary was then increased to $625,000 in January 2015, and to $685,000 effective January 2016. The salary is subject to annual review by the Committee and Mr. Grubbs is currently eligible to receive an annual bonus of a target at 100% of his base salary but not in excess of 180% of his base salary based on the level of achievement of performance goals to be established by the Committee. Mr. Grubbs is eligible to participate in the Company’s equity incentive plan, as well as all benefit plans and fringe benefit arrangements available to our senior executives. If Mr. Grubbs’ employment agreement is not renewed by us at the end of any employment term, is terminated by us without cause or Mr. Grubbs terminates his employment for good reason (see “Potential Payments Upon Termination or Change in Control” below), and if he is not otherwise entitled to receive severance benefits under our Executive Severance Policy, subject to his timely execution of a release, he will be entitled to a severance payment equal to the sum of (i) two years base salary and (ii) two times the average annual bonus paid in the immediately three prior calendar years and (iii) two years health benefits. In addition, any and all unvested stock appreciation rights, performance stock awards, stock options or other equity shall immediately vest upon such termination without Cause or for Good Reason.

The Company also agreed to reimburse Mr. Grubbs (on a tax grossed up basis) for the reasonable legal fees incurred by him in connection with the negotiation of the new employment agreement.

On March 3, 2014, we entered into an employment agreement with William J. Burns pursuant to which, on April 1, 2014, Mr. Burns became our Chief Financial Officer. Mr. Burns’ base salary was $400,000 per year. Effective January 2016, Mr. Burns’ base salary was increased to $440,000. The base salary is subject to annual review by the Committee and Mr. Burns is eligible to receive an annual bonus with a target of 70% of his base salary and not to exceed 180% of his base salary based on the level of achievement of performance goals to be established by the Committee. Mr. Burns is also eligible to participate in the Company’s equity incentive plan, as well as all benefit plans and fringe benefit arrangements available to our senior executives. If Mr. Burns’ employment is terminated by us without cause or Mr. Burns terminates his employment for good reason, and if he is not otherwise entitled to receive severance benefits under our Executive Severance Policy, subject to his timely execution of a release, he will be entitled to a severance payment equal to one year’s base salary and benefits.

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Severance/Change of Control Arrangements

We maintain an Executive Severance Policy, or the Severance Policy pursuant to which, subject to executing a release, each NEO is entitled to receive certain severance payments and benefits if, within 90 days prior to, or within 18 months after, a “Change of Control” (as defined in the Severance Policy) of the Company, such NEO was terminated without cause or incurred an “involuntary termination” ( i.e. a resignation for good reason). It is a “double-trigger” policy as a “Change of Control” must occur and the NEO must be terminated without Cause (as defined in the Severance Policy) or the NEO terminates for “Good Reason” (as defined in the Severance Policy). Under the Severance Policy, Mr. Grubbs, Mr. Burns, and Mses. Anenberg and Ball, are entitled to, and Mr. Tymchuk was entitled to, receive continued base salary for a period of two years following termination, plus two times the amount of their target bonus for the year in which a Change of Control occurs. In addition, during such periods, we would continue to make group health, life or other similar insurance plans available to such NEO and his or her dependents, and we would pay for such coverage to the extent we paid for such coverage prior to the termination of employment. The severance benefits payable under the Severance Policy are subject to: (1) the six-month delay under Section 409A of the Code; (2) the execution and non-revocation of a general release of claims in favor of the Company within a specified time period; and (3) reduction to avoid any excise tax on “parachute payments” if the NEO would benefit from such reduction as compared to paying the excise tax.

In addition, under our general severance pay policy for all of our eligible employees, if an NEO (other than Mr. Grubbs and Mr. Burns whose arrangements are included in their employment agreements) is terminated without cause (as defined in our general severance pay policy) other than in connection with a Change of Control, the NEO, subject to executing a release, would be entitled to one week’s base salary for each full year of continuous service with us.

Perquisites

Our NEOs are not entitled to any perquisites that are not otherwise available to all of our employees. In this regard, it should be noted that we do not provide pension arrangements, post-retirement health coverage or similar benefits for our executives or employees.

Stock Ownership Guidelines

Effective as of January 1, 2014, our Company’s chief executive officer must hold shares of Common Stock equal to three times his base salary, to be accumulated over three years, and the Company’s other senior executives must hold shares of Common Stock equal to one times his or her base salary, to be accumulated over three years.

Impact of Accounting and Tax Matters

As a general matter, the Committee reviews and considers the various tax and accounting implications of compensation vehicles that we utilize. With respect to accounting matters, the Committee examines the accounting cost associated with equity compensation in light of ASC Topic 718.

With respect to tax matters, the Committee considers the impact of Section 162(m) of the Code, which generally prohibits any publicly-held corporation from taking a Federal income tax deduction for compensation paid in excess of $1 million in any taxable year to the chief executive officer and any other executive officer (other than the chief financial officer) employed on the last day of the taxable year whose compensation is required to be disclosed to stockholders under Commission rules. Exceptions include qualified performance-based compensation, among other things. It is the Committee’s policy to maximize the effectiveness of our executive compensation plans in this regard. Nonetheless, the Committee retains the discretion to grant awards (such as restricted stock with time-based vesting) that will not comply with the performance-based exception of 162(m) if it is deemed in the best interest of the Company to do so.

Incentive Compensation Recoupment “Clawback” Policy

The Company has an Incentive Compensation Recoupment Policy (“Clawback Policy”) for executive officers. This policy further strengthens the risk mitigation program by defining the economic consequences that misconduct has on the executive officer’s incentive-related compensation. If there is a “Restatement” and the

26

Board determines that an executive received incentive compensation over a 3-year look back period (during which the policy was in effect) in excess of the amount that would have been paid to the executive had such incentive compensation been calculated based on the restatement, regardless of fault, the Board has the discretion to (i) require the executive to repay all or a portion of any cash incentive compensation, (ii) cancel all or a portion of any vested or unvested incentive compensation awarded to the executive, and (iii) require the executive to repay all or a portion of any gains realized with respect to the award. Under the policy, “Restatement” means any restatement of the Company’s financial statements due to non-compliance with any accounting requirement where such restatement is due to the covered person’s fraud or misconduct, errors or omissions or other related activities.

COMPENSATION COMMITTEE REPORT

The Compensation Committee of the Company has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management and, based on such review and discussions, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in the Proxy Statement.

 
THE COMPENSATION COMMITTEE
 
Joseph A. Trunfio, PhD, Chairman
 
W. Larry Cash, Member
Mark Perlberg, Member

27

SUMMARY COMPENSATION TABLE

The following table provides a summary of the compensation received by our NEOs for the fiscal years ended December 31, 2016, 2015 and 2014.

Name and
Principal Position
Year
Salary
($)
Bonus
($)(1)
Stock
Awards
($)(2)
Option
Awards
($)
Non-Equity
Incentive
Plan
Compensation
($)
Change in
Pension Value
and
Nonqualified
Deferred
Compensation
Earnings ($)
All Other
Compensation
($)(3)
Total
($)
William J. Grubbs
Chief Executive
Officer and President
 
2016
 
 
685,000
 
 
 
 
1,370,014
 
 
 
 
437,564
 
 
 
 
 
 
2,492,578
 
 
2015
 
 
625,000
 
 
 
 
1,093,753
 
 
 
 
600,000
 
 
 
 
 
 
2,318,753
 
 
2014
 
 
549,997
 
 
 
 
669,101
 
 
 
 
418,159
 
 
 
 
 
 
1,637,257
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
William J. Burns
Chief Financial Officer
and Principal
Accounting Officer(4)
 
2016
 
 
440,000
 
 
 
 
396,002
 
 
 
 
207,751
 
 
 
 
1,656
 
 
1,045,409
 
 
2015
 
 
400,000
 
 
 
 
359,998
 
 
 
 
288,899
 
 
 
 
34,014
 
 
1,082,911
 
 
2014
 
 
298,461
 
 
 
 
552,605
 
 
 
 
159,661
 
 
 
 
85,727
 
 
1,096,454
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Christopher R. Pizzi
Former Acting Chief
Financial Officer(4)
 
2016
 
 
220,000
 
 
 
 
84,015
 
 
 
 
66,527
 
 
 
 
1,616
 
 
372,158
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Vickie L. Anenberg
President, Cross
Country Staffing
 
2016
 
 
400,000
 
 
 
 
359,995
 
 
 
 
205,953
 
 
 
 
1,656
 
 
967,604
 
 
2015
 
 
357,500
 
 
 
 
321,762
 
 
 
 
191,307
 
 
 
 
4,675
 
 
875,244
 
 
2014
 
 
342,375
 
 
 
 
243,748
 
 
 
 
196,092
 
 
 
 
4,375
 
 
786,590
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Susan E. Ball
General Counsel
And Secretary
 
2016
 
 
335,000
 
 
 
 
234,507
 
 
 
 
142,526
 
 
 
 
1,656
 
 
713,689
 
 
2015
 
 
335,000
 
 
 
 
234,496
 
 
 
 
207,389
 
 
 
 
3,430
 
 
780,315
 
 
2014
 
 
289,731
 
 
75,000
 
 
217,400
 
 
 
 
127,272
 
 
 
 
3,250
 
 
712,653
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Paul Tymchuk
Chief Information
Officer
 
2016
 
 
275,000
 
 
 
 
165,006
 
 
 
 
 
 
 
 
1,656
 
 
441,662
 
 
2015
 
 
275,000
 
 
 
 
164,996
 
 
 
 
95,896
 
 
 
 
3,390
 
 
539,282
 
 
2014
 
 
259,616
 
 
 
 
150,008
 
 
 
 
76,020
 
 
 
 
 
 
485,644
 
(1) For 2014, reflects a bonus paid to Ms. Ball for performance in connection with the Company’s acquisition of MSN and entry into new credit agreements.
(2) Amounts in this column reflect the aggregate grant date fair value of awards of restricted stock and Performance-based Share Awards granted under our 2014 Omnibus Incentive Plan and computed in accordance with ASC Topic 718. The grant date fair value of the Performance-based Share Awards is based on the probable outcome of the performance conditions as of the grant date, in accordance with Item 402 of Regulation S-K. The aggregate grant date fair value per share of stock awards granted on March 31, 2016, was $11.63. The fair value of awards at the maximum level of achievement for performance awards for 2016 is as follows: Mr. Grubbs, $1,507,015; Mr. Burns, $435,602; Mr. Pizzi, $92,412; Ms. Annenberg, $395,990; Ms. Ball, $257,953; and Mr. Tymchuk, $181,509.
(3) The “All Other Compensation” column for 2016 consists of employer matching contributions to the 401(k) plan in the following amounts:
Name
401(k) Match
Grubbs
 
 
Burns
 
1,656
 
Pizzi
 
1,616
 
Anenberg
 
1,656
 
Ball
 
1,656
 
Tymchuk
 
1,656
 

See the discussion of our matching contributions under “401(k) Plan” above in the Compensation and Discussion Analysis.

(4) Mr. Pizzi was Cross Country Healthcare’s Acting Chief Financial Officer during Mr. Burns’ medical leave of absence beginning October 12, 2016. On December 1, 2016, Mr. Burns returned to his duties and Mr. Pizzi resumed his full-time duties as Cross Country Healthcare’s Vice President of Finance, Corporate Controller and Treasurer.

28

GRANTS OF PLAN-BASED AWARDS

The following table summarizes equity and non-equity incentive plan awards granted to our NEOs during the last fiscal year.

Name
 
 
Estimated Future Payouts
Under Non-Equity
Incentive Plan Awards(1)
Estimated Future Payouts
Under Equity Incentive
Plan Awards(2)
All Other
Stock
Awards:
Number Of
Shares Of
Stock Or
Units (#)(3)
Grant Date
Fair Value
of Stock
Awards
($)(4)
Grant
Date
Committee
Action Date
Threshold
($)
Target
($)
Maximum
($)
Threshold
(#)
Target
(#)
Maximum
(#)
William J. Grubbs
 
3/31/2016
 
 
2/24/2016
 
 
137,000
 
 
685,000
 
 
1,233,000
 
 
 
 
 
 
 
 
 
 
 
 
 
3/31/2016
 
 
2/24/2016
 
 
 
 
 
 
 
 
11,780
 
 
58,900
 
 
70,680
 
 
58,900
 
 
1,370,014
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
William J. Burns
 
3/31/2016
 
 
2/24/2016
 
 
61,600
 
 
308,000
 
 
554,400
 
 
 
 
 
 
 
 
 
 
 
 
 
3/31/2016
 
 
2/24/2016
 
 
 
 
 
 
 
 
3,405
 
 
17,025
 
 
20,430
 
 
17,025
 
 
396,002
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Christopher R. Pizzi
 
3/31/2016
 
 
2/24/2016
 
 
44,000
 
 
88,000
 
 
132,000
 
 
 
 
 
 
 
 
 
 
 
 
 
3/31/2016
 
 
2/24/2016
 
 
 
 
 
 
 
 
722
 
 
3,612
 
 
4,334
 
 
3,612
 
 
84,015
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Vickie L. Anenberg
 
3/31/2016
 
 
2/24/2016
 
 
52,000
 
 
260,000
 
 
468,000
 
 
 
 
 
 
 
 
 
 
 
 
 
3/31/2016
 
 
2/24/2016
 
 
 
 
 
 
 
 
3,095
 
 
15,477
 
 
18,572
 
 
15,477
 
 
359,995
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Susan E. Ball
 
3/31/2016
 
 
2/24/2016
 
 
40,200
 
 
201,000
 
 
361,800
 
 
 
 
 
 
 
 
 
 
 
 
 
3/31/2016
 
 
2/24/2016
 
 
 
 
 
 
 
 
2,016
 
 
10,082
 
 
12,098
 
 
10,082
 
 
234,507
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Paul Tymchuk
 
3/31/2016
 
 
2/24/2016
 
 
24,750
 
 
123,750
 
 
222,750
 
 
 
 
 
 
 
 
 
 
 
 
 
3/31/2016
 
 
2/24/2016
 
 
 
 
 
 
 
 
1,419
 
 
7,094
 
 
8,513
 
 
7,094
 
 
165,006
 
(1) Amounts relate to the NEOs individual annual cash incentive as described in the Compensation Discussion and Analysis contained herein.
(2) The number of shares relate to the Performance-based Share Awards (PSAs) granted to the NEOs for 2016. The PSAs provide for the issuance of a number of restricted shares after the one-year performance period based on the level of attainment of Adjusted EPS (a non-GAAP financial measure) for 2016 as discussed above. Any restricted shares issued under the PSAs would vest on December 31, 2018, subject to the NEO’s continued employment through such date.
(3) All other stock awards include restricted stock awards granted to the NEOs for 2016, as described in the Compensation Discussion and Analysis contained herein. All of the restricted stock awards provide for vesting of 33 and 1/3% of the award on each of the first, second and third anniversaries of the grant date, subject to the NEO’s continued employment through the vesting date.
(4) Grant date fair value is calculated by multiplying the number of shares times the fair value per award. The grant date fair value of the Performance-based Share Awards is based on the probable outcome of the performance conditions as of the grant date. Refer to the footnotes to the Summary Compensation Table above.

29

OUTSTANDING EQUITY AWARDS AT 2016 YEAR-END

The following table summarizes the outstanding equity awards as of December 31, 2016 held by our NEOs.

 
 
Option Awards
Stock Awards
Name
Grant
Date
Number of
Securities
Underlying
Unexercised
Options
Exercisable
(#)
Number of
Securities
Underlying
Unexercised
Options
Unexercisable
(#)(1)
Equity
Incentive
Plan Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#)
Option
Exercise
Price
($)
Option
Expiration
Date
Number of
Shares or
Units of
Stock That
Have Not
Vested
(#)(1)
Market
Value of
Shares
or Units
of Stock
That
Have Not
Vested
($)(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)
William J. Grubbs
 
4/01/2013
 
 
 
 
12,500
 
 
 
 
5.35
 
 
4/1/2020
 
 
11,683
 
 
182,372
 
 
 
 
 
 
 
3/31/2014
 
 
 
 
 
 
 
 
 
 
 
 
18,742
 
 
292,563
 
 
 
 
 
 
 
3/31/2015
 
 
 
 
 
 
 
 
 
 
 
 
76,851
 
 
1,199,644
 
 
 
 
 
 
 
3/31/2016
 
 
 
 
 
 
 
 
 
 
 
 
58,900
 
 
919,429
 
 
58,900
 
 
919,429