ESSENDANT INC. (NASDAQ:ESND) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain OfficersItem 5.02
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On December 21, 2017, the Human Resources Committee (the “Committee”) of the Board of Directors (the “Board”) of Essendant Inc. (the “Registrant”) approved a compensation program for Richard D. Phillips. Mr. Phillips was appointed President and Chief Executive Officer of the Registrant on October 24, 2017, at which time his compensation arrangement from his prior term as Interim President and Chief Executive Officer remained in effect. The compensatory changes approved by the Committee reflect adjustments to Mr. Phillips’ compensation commensurate with his new role as President and Chief Executive Officer. The compensation changes approved include:
|
Mr. Phillips’ annual base salary was increased to $825,000, retroactive to his October 24, 2017 appointment as the Registrant’s President and Chief Executive Officer; |
|
|
Mr. Phillips’ annual cash incentive target was increased to 130% of his annual base salary. This target level of annual cash incentive will also apply to the portion of fiscal 2017 during which Mr. Phillips served as President and Chief Executive Officer; |
|
|
Mr. Phillips will be eligible to receive annual long-term equity awards with an economic value target of $2,600,000; |
|
|
• |
Mr. Phillips will continue to receive a cash perquisite allowance of $2,000 per month; Mr. Phillips will receive a one-time restricted stock award with a target economic value of $1,000,000 and a one-time performance unit award with a target economic value of $2,000,000 and a maximum value of $4,000,000. These awards will be issued as of January 1, 2018. The restricted stock award will cliff vest on January 1, 2021. To the extent the performance metrics for the performance unit award, which are tied to stock price growth, are satisfied, that award will also vest on January 1, 2021. The awards will also vest in connection with certain termination of employment and change in control scenarios. |
On December 21, 2017, the Committee also approved an Amended and Restated Executive Employment Agreement between the Registrant, Essendant Co. and Essendant Management Services LLC (collectively, the “Company”) and Mr. Phillips (the “Employment Agreement”) providing for enhanced severance benefits for Mr. Phillips commensurate with his role as President and Chief Executive Officer. In the event of a qualifying termination, Mr. Phillips’ severance benefits will equal two times his base salary, plus an amount equal to two times his target annual cash incentive, plus an amount equal to the pro-rata actual cash incentive award which would otherwise be payable for the calendar year during which the qualifying termination occurs, and 24 months’ continued medical and/or dental insurance coverage; these amounts would increase to three times base salary, three times target annual cash incentive, an amount equal to the pro-rata actual cash incentive award which would otherwise be payable for the calendar year during which the qualifying termination occurs, and 36 months’ insurance coverage if the termination were to occur on or within two years following a change of control.
Mr. Phillips’ compensation program and the amended Employment Agreement were approved by the Board on December 21, 2017.
Item 5.02Financial Statements and Exhibits.
The following exhibits are filed herewith:
Exhibit No.Description
ESSENDANT INC ExhibitEX-10.1 2 esnd-ex101_6.htm EX-10.1 esnd-ex101_6.htm Exhibit 10.1 ESSENDANT INC.2015 LONG-TERM INCENTIVE PLAN2018 Restricted Stock Award Agreement This Restricted Stock Award Agreement (this “Agreement”),…To view the full exhibit click here
About ESSENDANT INC. (NASDAQ:ESND)
Essendant Inc. (Essendant), formerly United Stationers Inc., is a wholesale distributor of workplace items. The Company stocks an assortment of over 180,000 products in categories, including janitorial and breakroom supplies, technology products, traditional office products, industrial supplies, office furniture, and automotive aftermarket tools and equipment. The Company has four operating segments: Business and Facility Essentials, ORS Industrial, CPO Commerce, Inc. (CPO) and Automotive. Business and Facility Essentials also included operations in Mexico conducted through a subsidiary, Azerty de Mexico. It offers private brand products within each of its product categories, which include Innovera technology products, Universal office products, Windsoft paper products, Boardwalk and UniSan janitorial and sanitation products, Alera office furniture and Anchor Brand and Best Welds welding, industrial, safety and oil field pipeline products.