WEIS MARKETS, INC (NYSE:WMK) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

ME Staff 8-k
-
0

WEIS MARKETS, INC (NYSE:WMK) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

Item 5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.

Jonathan H. Weis Employment Agreement
On
April 4, 2017, with retroactive effect to January 1, 2017,
Weis Markets, Inc. (the “Company”) entered into an
employment agreement (the “Employment Agreement”) with
Jonathan H. Weis, who serves as Chairman, President and Chief
Executive Officer. The Employment Agreement commenced on
January 1, 2017 and continues through December 31, 2019 (the
“Term”). The Employment Agreement provides Mr. Weis with
the following compensation and benefits:
Annual base salary of no less than $1,018,457, subject to
periodic review and adjustment by the Board of Directors of
the Company (the “Board”) or the Compensation Committee of
the Board;
Participation in any annual or long-term bonus or
incentive plans maintained by the Company for its senior
executives;
A
supplemental long-term cash incentive under the Company’s
Chief Executive Officer Incentive Award Plan (the “Plan”),
effective January 1, 2017 (as further described
below);
Participation in any stock option, stock ownership, stock
incentive or other equity-based compensation plans maintained
by the Company for its senior executives;
Participation in all compensation or employee benefit
plans or programs, and all benefits or perquisites, for which
any member of the Company’s senior management is eligible
under any existing or future Company plan or program;
and
A
term life insurance policy with a death benefit of
$1,500,000.
The
Employment Agreement further provides that if the Board
determines that Mr. Weis has been incompetent or negligent in
the performance of his duties or engaged in fraud or willful
misconduct in a manner that caused or contributed to the need
for a material restatement of the Company’s financial
results, and if the performance-based compensation paid under
the Employment Agreement would have been lower if based on
such restated results, then the Board and the Company will
seek recoupment from Mr. Weis of any portion of such
performance-based compensation deemed appropriate.
In
the event that Mr. Weis’ employment terminates due to a
“Without Cause Termination” or is terminated by Mr. Weis
for “Good Reason,” then, to the Employment Agreement, Mr.
Weis will be entitled to:
Earned but unpaid base salary as of the date of
termination and any earned but unpaid bonuses for prior years
(other than any bonuses payable under the Plan) (“Accrued
Obligations”);
Continued base salary, as in effect at termination,
payable until the end of the Term; and
Payment, for the year of termination and for each
subsequent calendar year or portion thereof during the
remainder of the Term, of an amount (prorated in the case of
any partial year) equal to the highest annual incentive bonus
(not including any bonus paid under the Plan) received for
any year in the two years preceding the date of
termination.
For
these purposes “Without Cause Termination” means a
termination of employment by the Company other than due to
“Disability” or the expiration of the Term and other than a
“Termination for Cause.” “Disability” for purposes of
this Agreement shall have the meaning set forth in Internal
Revenue Code (the “Code”) Section409(a)(2)(C) and the
regulations thereunder. A “Termination for Cause” means a
termination by the Company by the vote of the majority of the
Board because Mr. Weis (a) has been convicted of, or has
entered a plea of nolo contendere to, a criminal offense
involving moral turpitude, or (b) has willfully continued to
fail to substantially perform his duties with the Company
after a written demand for substantial performance is
delivered by the Board, or (c) has committed an improper
action resulting in personal enrichment at the expense of the
Company, or (d) has engaged in illegal or gross misconduct
that is materially and demonstrably injurious to the Company,
or (e) has violated his representations or duties under the
Employment Agreement.
In
the event of his Disability, the Company may remove Mr. Weis
from employment, in which case, to the Employment Agreement,
Mr. Weis will be entitled to:
Accrued Obligations;
Continued base salary, offset by any amounts otherwise
payable under the Company’s disability program, at the rate
of 50% of base salary as of the date of disability, payable
until the end of the Term; and
A
bonus for the year of disability equal to the amount
determined by the Company in good faith to be the amount of
bonus that Mr. Weis would have received if he had been
employed throughout the bonus year, which will be prorated on
a daily basis as of the date of disability.
In
the event of his death, to the Employment Agreement, Mr. Weis
will be entitled to:
Accrued Obligations as of the date of death payable in
full; and
From
the date of death until the end of the Term, base salary
payments, at the rate of 50% of base salary as of the date of
death, to Mr. Weis’ surviving spouse and, following the
death of his spouse, to his estate.
In
the event that Mr. Weis’ employment terminates due to a
Termination for Cause or Mr. Weis terminates employment other
than for “Good Reason,” Disability, retirement under the
Company’s established policies, or death, then Accrued
Obligations and vested benefits as of the date of termination
will be payable to Mr. Weis in full. No other payments will
be made to Mr. Weis, except for benefits that have already
become vested under the terms of the Company’s employee
benefit programs. For these purposes, a termination by Mr.
Weis for “Good Reason” means a termination by notice given
at any time due to (a) any reduction without his consent in
Mr. Weis’ salary below $1,018,457 per annum or (b) failure
of the Company or its successor to fulfill its obligations
under the Employment Agreement in any material
respect.
The
Employment Agreement also provides that Mr. Weis may not
disclose or use any confidential information of the Company
during or after the Term of the Employment Agreement. During
his employment with the Company and for a period of four
years following his termination of employment for any reason,
Mr. Weis is also precluded from engaging or assisting in any
business which is in competition with the Company and from
soliciting any Company employee, consultant, vendor or
supplier.
The
preceding description of the Employment Agreement is a
summary of its material terms, does not purport to be
complete, and is qualified in its entirety by reference to
the Employment Agreement, a copy of which is being filed as
Exhibit 10.1 to this Current Report on Form 8-K and is
incorporated herein by reference.
Chief Executive Officer Incentive Award
Plan
The
Compensation Committee of the Board adopted the Chief
Executive Officer Incentive Award Plan (the “Plan”),
effective January 1, 2017, which is designed to provide a
strong financial incentive for chief executive officer
(“CEO”) performance by making a significant percentage of
the CEO’s total cash compensation dependent upon yearly
corporate performance, and to encourage CEO retention.
to
the Plan, the CEO is entitled to receive an incentive award
for each fiscal year consisting of the following:
A
retention award equal to the participant’s base salary, in
effect as of the end of the fiscal year, multiplied by 1.5; and
A
performance award equal to the base salary in effect as of
the end of the fiscal year, contingent upon the achievement
of specified performance requirements (each, a “Performance
Target,” and together, the “Performance Targets”), as
follows:
One-half of the Performance Award is based on the ratio of
the Company’s net sales in comparison to a net sales target
for a Plan year. The net sales ratio has a “Threshold”
which must be met in order to qualify for such Performance
Award, a “Target” which is the net sales target, and a
“Maximum” net sales ratio upon which a Performance Award
may be made. The Threshold is 97% of the net sales target and
the Maximum is 103% of the net sales target, with 0%
performance achieved at Threshold, 50% performance achieved
at Target and 150% performance achieved at Maximum, and with
interpolation used to determine the performance achieved
between the Threshold, Target and Maximum levels.
One-half of the Performance Award is based on the ratio of
the Company’s Modified Return On Invested Capital (the
“MROIC”) in comparison to the MROIC target for a Plan year.
The MROIC ratio has a “Threshold” which must be met in
order to qualify for such Performance Award, a “Target”
which is the MROIC target, and a “Maximum” MROIC ratio upon
which a Performance Award may be made. The Threshold is 98%
of the MROIC target and the Maximum is 105% of the MROIC
target, with 0% performance achievement at Threshold, 50%
performance achieved at Target and 150% performance achieved
at Maximum, and with interpolation used to determine the
performance achieved between the Threshold, Target and
Maximum levels.
The Committee retains the right to adjust the Target and
related Threshold and Maximum levels at any time in their
sole discretion. Although the right to receive awards
under the Plan are measured and determined on an annual
basis, except in the case of a Without Cause Termination (as
defined above) or death, no Plan award will be paid to the
participant until after December 31, 2019, provided that the
participant remains employed as such from January 1, 2017
through December 31, 2019. Within 2 months following the end
of the fiscal year, the Compensation Committee will determine
in accordance with the terms of the Plan and certify in
writing whether a Performance Target was achieved. Subject to
exception in the event that a delay in payment is required
under Section 409A of the Code and any deferral election made
by the participant under any deferral plan of the Company
then in effect, any incentive award to which a participant
becomes entitled will be paid in a lump sum cash payment
within 2 months after December 31, 2019, subject to the
determination and certification by the Committee of each
performance award for each plan year.
Under
the Plan, if the participant’s employment is subject to a
Without Cause Termination, the Company will pay the
participant as follows:
If the Without Cause Termination occurs
on or between the following dates: Amount to be Paid
January 1, 2017 to December 31, 2017 $3,200,000
January 1, 2018 to December 31, 2018 $4,000,000
January 1, 2019 to December 31, 2019 $4,800,000

Subject
to exception in the event that a delay in payment is required
under Section 409A of the Code, any amounts payable due to a
Without Cause Termination will be paid in a lump sum cash payment
within 2 months after the end of the calendar year in which such
Without Cause Termination occurs.

Upon
the death of the participant, the Company will pay $1,300,000 to
the participant’s surviving spouse, if any, or otherwise to the
participant’s estate. Such payment will be made within sixty
(60) days of the date of death of the participant. In the case of
any other termination of employment prior to December 31, 2019,
including for disability, retirement, resignation or Termination
for Cause, the participant will not be entitled to receive
payment of any amounts under the Plan.

Incentive awards payable under the Plan are subject to the
same recoupment provisions as apply for payments made to the
Employment Agreement, as described above.

The
preceding description of the Plan is a summary of its material
terms, does not purport to be complete, and is qualified in its
entirety by reference to the Plan, a copy of which is being filed
as Exhibit 10.2 to this Current Report on Form 8-K and is
incorporated herein by reference.

Item 9.01 Financial Statements and
Exhibits.

(d)
Exhibits.

The following exhibits are filed
herewith:

Exhibit No. Description
10.1 Employment Agreement, effective January 1, 2017, by and
between Weis Markets, Inc. and Jonathan H. Weis.
10.2 Weis
Markets, Inc. Chief Executive Officer Incentive Award Plan,
effective January 1, 2017.


About WEIS MARKETS, INC (NYSE:WMK)

Weis Markets, Inc. is engaged principally in the retail sale of food in Pennsylvania and surrounding states. The Company’s retail food stores sell groceries, dairy products, frozen foods, meats, seafood, fresh produce, floral, pharmacy services, deli products, prepared foods, bakery products, beer and wine, fuel and general merchandise items, such as health and beauty care and household products. The Company advertises its products and promotes its brand through weekly newspaper circulars; radio ads; e-mail blasts, and online via its Website, social media and mobile applications. Printed circulars are used on a weekly basis to advertise featured items. The Company utilizes a loyalty marketing program, Weis Club Preferred Shopper, which enables customers to receive discounts, promotions and fuel rewards. All retail food store locations operate as conventional supermarkets. The Company owns and operates approximately 160 retail food stores.

WEIS MARKETS, INC (NYSE:WMK) Recent Trading Information

WEIS MARKETS, INC (NYSE:WMK) closed its last trading session 00.00 at 59.68 with 79,770 shares trading hands.