GENCO SHIPPING 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.
On December 18, 2018, the Board of Directors (the “Board”) of Genco Shipping & Trading Limited (the “Company”), acting on the recommendation of its Compensation Committee, adopted a cash bonus plan that will be used to calculate cash bonuses that may become payable to the Company’s executive officers and other employees commencing with the year ending December 31, 2018 (the “Cash Bonus Plan”). The Cash Bonus Plan establishes measurable criteria intended to reinforce a pay for performance framework that aligns the interests of executive officers and other employees with those of the shareholders. The Cash Bonus Plan utilizes weighted performance criteria to determine the amount of the cash bonus. For 2018, the following performance measures have been established: Adjusted EBITDA relative to an internal goal, time charter equivalent (TCE) performance of our fleet compared to an internal benchmark, costs incurred by the Company compared to the budgeted costs, total shareholder return of the Company’s common stock compared to a peer group and achievement of individual performance goals.
The Cash Bonus Plan provides for payment of cash bonuses based on achievement of specified benchmarks for each performance metric. Actual bonuses may range from 0 to 150 percent of the target bonus amounts. Bonuses are calculated on the basis of performance relative to each performance metric, and for each metric there are threshold, target and maximum bonus levels. In respect of each metric, no bonus amount is generated for performance below the threshold level; 50% of the target bonus amount is generated for performance at threshold; the target bonus amount is generated for performance at the target level; and the maximum bonus amount is generated for performance at the maximum level. The amount to be awarded for achievement of individual performance goals is within the Board’s discretion for named executive officers and, for non-named executive officers, senior management. Actual bonus amounts are calculated by linear interpolation between the threshold and the target and between the target and the maximum. For 2018, the amount payable under the Cash Bonus Plan ranges from $0 to $975,000 for John C. Wobensmith, Chief Executive Officer and President, based on a target bonus of $650,000; from $0 to $292,500 for Apostolos Zafolias, Chief Financial Officer and Executive Vice President, Finance, based on a target bonus of $195,500; and from $0 to $189,000, for Joseph Adamo, Chief Accounting Officer, Treasurer, and Controller, based on a target bonus of $126,000. The Board can modify or terminate the Cash Bonus Plan at any time, and the payment of any bonus under the Cash Bonus Plan is subject to the discretion of the Board.