Kennametal Inc. (NYSE:KMT) 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.
Kennametal Inc. (NYSE:KMT) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Appointment of Christopher Rossi as President and Chief Executive Officer; Election of Director
On June>29, 2017, Kennametal Inc. (Kennametal or the Company) announced the appointment of Mr. Christopher Rossi to serve as Kennametals President and Chief Executive Officer starting on August 1, 2017. Mr. Rossi has also been appointed to serve as a member of the Board of Directors to hold office from August 1, 2017 until the Annual Meeting of Shareowners in October 2017 and until a successor shall have been elected and qualified or until his earlier death, resignation or removal.
Mr. Rossi, age 51, previously served as the Chief Executive Officer of Dresser-Rand at Siemens Aktiengesellschaft, from September 2015 through May 2017. From September 2012 to August 2015, Mr. Rossi served as Executive Vice President of Global Operations at Dresser-Rand Group Inc., where he was responsible for Product Manufacturing Operations and certain related functions. Mr. Rossi held various leadership positions with Dresser-Rand Group Inc., its affiliates and predecessor companies since he joined in 1987, having been responsible for the areas of Engineering, Production, Supply Chain Management, Sales and Business Development. From January 2009 to September 2012, he served as Vice President, Technology and Business Development. Prior to that, Mr. Rossi was the Executive Vice President of Product Services Worldwide, where he served from February 2007 to December 2008. In that capacity, Mr. Rossi assumed worldwide responsibility for sales of the aftermarket parts and services business. From October 2003 to February 2007, Mr. Rossi served as the Vice President and General Manager of North American Operations, where he was responsible for all U.S. plants and worldwide development engineering. Mr. Rossi was a Vice President and General Manager, Painted Post Operation from February 2001 to October 2003, and a Vice President, Supply Chain Management Worldwide, from March 1998 to January 2001. Mr. Rossi holds a Bachelor of Science in Mechanical Engineering from Virginia Tech, and an M.B.A. in Corporate Finance and Operations Management from the University of Rochesters Simon School of Business.
In connection with his appointment as President and Chief Executive Officer, Mr. Rossi will be entitled to the following:
|
Annual base salary of $850,000
|
|
Cash signing bonus of $500,000, to be repaid in full if Mr. Rossi voluntarily resigns or is terminated for cause from the Company on or before August 1, 2018.
|
|
Participation in the Companys Annual Incentive Plan with a target bonus for fiscal year 2018 of 120% of annual base salary.
|
|
On August 1, 2017, subject to Board approval, Mr. Rossi will be eligible to receive a long-term incentive grant of $2,700,000, consisting of 60% Performance Stock Units (PSUs) and 40% Time Vesting Restricted Stock Units (RSUs). PSUs cliff vest after 3 years and are subject to achievement of company performance goals in each of the 3 fiscal years in the term, and RSUs vest over a three-year period, with one-third vesting on each anniversary date of the grant. Long term incentive grants will be made under the terms of the Kennametal Inc. 2016 Stock and Incentive Plan.
|
|
Relocation assistance under the Company’s relocation policy.
|
|
Participation in all general employee benefit plans and programs as well as participation in any plans and programs for executives.
|
|
While Mr. Rossi serves as President and Chief Executive Officer, he will not sit on any Board committees or receive any additional compensation for his Board service.
|
At the time that Mr. Rossi starts his service with Kennametal on August 1, 2017, he will also enter into an officer’s employment agreement with Kennametal. Generally, the officer’s employment agreement will provide:
|
General. Mr. Rossi will be required to devote his entire time and attention to the business and affairs of Kennametal while he is employed.
|
|
Term.>>>There is no predetermined term.
|
|
Non-competition/non-disclosure. Unless Kennametal provides prior consent in writing, if Mr. Rossi voluntarily terminates his employment or if Kennametal terminates his employment for cause, then for two years after the date of termination, Mr. Rossi cannot, in any geographic area in which Kennametal is offering its services and products: (a) directly or indirectly engage in; or (b) assist or have an active interest in; or (c) enter the employ of, or act as agent for, or advisor or consultant to, any entity which is or is about to become directly or indirectly engaged in any business that is competitive with any business of the Company or any of its subsidiaries or affiliates in which the executive is or was engaged. The non-competition provisions do not apply if Kennametal terminates Mr. Rossi without cause. However, in case of termination for any reason, Mr. Rossi cannot disclose any of Kennametals confidential or trade secret information.
|
|
Assignment of Inventions.>>>Mr. Rossi must assign to Kennametal all inventions conceived or made during his employment with Kennametal.
|
|
Termination.>>>Mr. Rossis employment may be terminated by either party at any time, for any reason or no reason at all; provided, that the Company may only terminate Mr. Rossis employment with the approval and authorization of the Board.
|
|
Severance.>>>If, with Board authorization, Kennametal involuntarily terminates Mr. Rossis employment prior to a change in control and not for cause, he will be entitled to 24 months of severance in the form of salary continuation.
|
|
Change in Control.>>>The agreement provides for payments to Mr. Rossi if he resigns for good reason or if he is terminated by the Company without cause within six months prior to a change in control of the Company, or within 24 months following a change in control of the Company. In this event, he will receive a payment equal to two times his base salary and two times his target bonus.
|
There>are no related-party transactions with respect to Mr. Rossi required to be disclosed to Item 404(a) of Regulation S-K.
Transition of Ronald De Feo into Role of Executive Chairman
When Mr. Rossi starts his service with the Company as President and Chief Executive Officer in August 2017, Kennametals current President and Chief Executive Officer Ron De Feo will transition to the role of Executive Chairman of the Board of Directors. As part of the transition, Mr. De Feo will enter into a new letter agreement with Kennametal, effective as of August 1, 2017 to establish Mr. De Feos compensation under his new role with Kennametal. Under the terms of the letter agreement, Mr. De Feo will be entitled:
|
Annual base salary of $700,000, to be prorated based on actual days served in his new position.
|
|
Participation in the Companys Annual Incentive Plan with a target bonus of 140% of annual base salary, to be prorated based on time in position.
|
|
Upon his termination, vesting of all grants awarded as to him for his service as President and Chief Executive Officer.
|
|
Upon his retirement from the board, vesting of all equity awarded to him for his service as a Director.
|
A copy of Mr. De Feos letter agreement is being filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated by reference into this Item. The description of the letter agreement is not complete and is qualified in its entirety by reference to the agreement filed as an exhibit to this Current Report on Form 8-K.
Item 8.01 Other Events.
On June 29, 2017, the Company issued a press release announcing Mr. Rossis appointment as President and Chief Executive Officer and Mr. De Feos appointment as Executive Chairman. A copy of this press release is attached hereto as Exhibit 99.1.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
|
10.1
|
|
Form of Letter Agreement with Mr. De Feo dated August 1, 2017
|
|
Filed herewith.
|
|
99.1
|
|
Press Release dated June 29, 2017
|
|
Filed herewith.
|
KENNAMETAL INC ExhibitEX-10.1 2 a6292017exhibit101.htm EXHIBIT 10.1 Exhibit Exhibit 10.1August 1,…To view the full exhibit click
Kennametal Inc. is a supplier of tooling, engineered components and materials consumed in production processes. The Company operates through two segments: Industrial and Infrastructure. The Industrial segment generally serves customers that operate in industrial end markets, such as transportation, general engineering, aerospace and defense. The Infrastructure segment generally serves customers that operate in the earthworks and energy sectors supporting primary industries, such as oil and gas, power generation, underground, surface and hard-rock mining, highway construction and road maintenance. It provides wear-resistant products, application engineering and services backed by material science serving customers across various sectors. The Company’s product offerings include a selection of standard and customized technologies for metalworking, such as metal cutting tools, tooling systems and services, as well as materials, such as cemented tungsten carbide products and super alloys.
here About Kennametal Inc. (NYSE:KMT) Kennametal Inc. is a supplier of tooling, engineered components and materials consumed in production processes. The Company operates through two segments: Industrial and Infrastructure. The Industrial segment generally serves customers that operate in industrial end markets, such as transportation, general engineering, aerospace and defense. The Infrastructure segment generally serves customers that operate in the earthworks and energy sectors supporting primary industries, such as oil and gas, power generation, underground, surface and hard-rock mining, highway construction and road maintenance. It provides wear-resistant products, application engineering and services backed by material science serving customers across various sectors. The Company’s product offerings include a selection of standard and customized technologies for metalworking, such as metal cutting tools, tooling systems and services, as well as materials, such as cemented tungsten carbide products and super alloys.