NCI Building Systems, Inc. (NYSE:NCS) 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.
Resignation of Norman C. Chambers and Appointment of Donald R.
Riley as Chief Executive Officer
Riley as Chief Executive Officer
On June 6, 2017, Norman C. Chambers, the chairman of the board of
directors (the Board) and Chief Executive Officer of NCI Building
Systems, Inc. (NCI, the Company, we and our), announced that he
will resign as the Companys Chief Executive Officer effective
July 1, 2017. Donald R. Riley, NCIs President since January 2016,
and President of NCIs Group Business Segment from December 2014
to January 2016, was appointed the Companys Chief Executive
Officer by the Board, effective July 1, 2017. Mr. Riley will
assume the role of our Chief Executive Officer in addition to his
position as our President. Mr. Chambers will remain employed by
the Company as its Executive Chairman of the Board, in accordance
with the terms of the employment agreement, dated as of September
1, 2015, as amended, between Mr. Chambers and the Company.
directors (the Board) and Chief Executive Officer of NCI Building
Systems, Inc. (NCI, the Company, we and our), announced that he
will resign as the Companys Chief Executive Officer effective
July 1, 2017. Donald R. Riley, NCIs President since January 2016,
and President of NCIs Group Business Segment from December 2014
to January 2016, was appointed the Companys Chief Executive
Officer by the Board, effective July 1, 2017. Mr. Riley will
assume the role of our Chief Executive Officer in addition to his
position as our President. Mr. Chambers will remain employed by
the Company as its Executive Chairman of the Board, in accordance
with the terms of the employment agreement, dated as of September
1, 2015, as amended, between Mr. Chambers and the Company.
Mr. Riley, age 54, has served as our President since January
2016. Mr. Riley served as President of our Group Business Segment
from December 2014 to January 2016. Before joining NCI, Mr. Riley
was employed by Probuild Holdings, LLC, a supplier of building
materials to production builders, custom builders, local
contractors and project-oriented consumers, where he served as
Executive Vice President from November 2011 to November 2014. As
Executive Vice President, Mr. Riley managed the supply chain,
manufacturing, construction services, marketing, pricing,
information technology, strategy and business project management
office functions. Prior to joining Probuild Holdings, Mr. Riley
was employed by Mohawk Industries, Inc., a floor covering
company, from September 2004 to November 2011, serving in various
capacities such as Chief Information Officer, Senior Vice
President Logistics, and Interim Flooring Executive Vice
President Customer Experience. Mr. Riley has a B.S. in
Engineering from the University of Tennessee at Knoxville.
2016. Mr. Riley served as President of our Group Business Segment
from December 2014 to January 2016. Before joining NCI, Mr. Riley
was employed by Probuild Holdings, LLC, a supplier of building
materials to production builders, custom builders, local
contractors and project-oriented consumers, where he served as
Executive Vice President from November 2011 to November 2014. As
Executive Vice President, Mr. Riley managed the supply chain,
manufacturing, construction services, marketing, pricing,
information technology, strategy and business project management
office functions. Prior to joining Probuild Holdings, Mr. Riley
was employed by Mohawk Industries, Inc., a floor covering
company, from September 2004 to November 2011, serving in various
capacities such as Chief Information Officer, Senior Vice
President Logistics, and Interim Flooring Executive Vice
President Customer Experience. Mr. Riley has a B.S. in
Engineering from the University of Tennessee at Knoxville.
Prior to his appointment as Chief Executive Officer, Mr. Riley
and the Company had entered into an employment agreement, dated
as of June 1, 2016, relating to his service as our President. The
material terms of the employment agreement are described in Item
5 of the Companys Quarterly Report on Form 10-Q with respect to
the period ended May 1, 2016 and the form of such agreement was
filed by the Company as an exhibit to its Quarterly Report on
Form 10-Q with respect to the period ended July 31, 2016. In
connection with his appointment as Chief Executive Officer, the
employment agreement has been amended and restated to reflect Mr.
Rileys new role with the Company, the material terms of which are
as follows:
and the Company had entered into an employment agreement, dated
as of June 1, 2016, relating to his service as our President. The
material terms of the employment agreement are described in Item
5 of the Companys Quarterly Report on Form 10-Q with respect to
the period ended May 1, 2016 and the form of such agreement was
filed by the Company as an exhibit to its Quarterly Report on
Form 10-Q with respect to the period ended July 31, 2016. In
connection with his appointment as Chief Executive Officer, the
employment agreement has been amended and restated to reflect Mr.
Rileys new role with the Company, the material terms of which are
as follows:
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The initial term of Mr. Rileys agreement will expire on
June 30, 2020, subject to one-year extensions thereafter, unless either party gives a one year notice of non-renewal. |
Mr. Rileys annual base salary has been increased from $525,000 to
$750,000.
$750,000.
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Mr. Rileys target annual bonus opportunity will be at least
50% of his base salary each year, subject to achievement of performance metrics to be set by the Compensation Committee of the Board. |
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Mr. Rileys severance entitlement upon a qualifying
termination (i.e. a termination by us without cause or a resignation by Mr. Riley with good reason) that occurs other than in connection with a change in control of the Company (a non-cic termination), has been increased from one times his base salary to two times the sum of his base salary plus his average bonus paid in respect of the three fiscal years most recently completed prior to his qualifying termination. |
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Mr. Rileys severance entitlement upon a qualifying
termination that occurs in connection with a change in control of the Company (i.e., during a specified period prior to, on or during the 24 months after, a change in control) (a cic termination) has been increased from (a) two times the sum of his base salary plus his target annual bonus to (b) the sum of two times his base salary plus three times his target annual bonus. |
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Mr. Rileys severance entitlements upon any qualifying
termination also (1) continue to include a prorated bonus for the year of his termination and (2), in lieu of the 12 months (in the case of a non-cic termination) or 18 months (in the case of a cic termination) of continued medical and dental insurance coverage provided under his prior employment agreement, include for a lump sum cash payment equal to 18 months of the premium cost of family medical coverage at the active-employee rate. |
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On July 1, 2017, Mr. Riley will be granted a one-time
promotion restricted stock unit award, having a grant date fair value equal to $385,000. This grant will vest ratably over three years and otherwise be granted subject to terms consistent with the Companys annual restricted stock unit grants for senior executives. |
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Promptly after July 1, 2017, Mr. Riley will be paid a
$250,000 cash promotion bonus, to be repaid to the Company if Mr. Riley (a) is terminated by us for cause or resigns without good reason prior to August 1, 2018 or (b) gives formal notice he does not intend to relocate to the Houston area, or otherwise fails to relocate to the Houston area, by August 31, 2018. |
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On or before December 31, 2017, Mr. Riley will be granted
restricted share units and performance share units, under such terms as the Compensation Committee of the Board determines for senior executives in connection with their annual grants, having a grant date fair value equal to $2,000,000. |
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Mr. Riley is also eligible to receive annual financial
planning services of up to $15,000, payment of attorneys fees incurred in negotiating his amended and restated employment agreement (up to a cap of $20,000) and temporary housing benefits under the Companys relocation policy through December 31, 2017 (subject to earlier termination upon certain events). |
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The duration of Mr. Rileys post-termination of employment
restrictive covenants in the employment agreement has been increased from one year to two years. |
The foregoing description of Mr. Rileys amended and restated
employment agreement is not complete and is qualified in its
entirety by the full text of the amended and restated employment
agreement, a copy of which will be filed as an exhibit to the
Companys Quarterly Report on Form 10-Q for the period ending July
30, 2017.
employment agreement is not complete and is qualified in its
entirety by the full text of the amended and restated employment
agreement, a copy of which will be filed as an exhibit to the
Companys Quarterly Report on Form 10-Q for the period ending July
30, 2017.
Expansion of Board and Appointment of New Board Members
On June 6, 2017, the Board added one newly created directorship
to the Board thereby increasing the total Board positions to 13.
to the Board thereby increasing the total Board positions to 13.
On June 6, 2017, in connection with the one newly created
directorship vacancy, the Board appointed Donald R. Riley as
director of the Company, effective as of July 1, 2017. Mr. Riley
was appointed as a Class III director. Mr. Riley was also
appointed as a member of the Executive Committee of the Board,
effective as of July 1, 2017, to serve on such committee until
his successor is duly appointed and qualified or until his
earlier resignation or removal.
directorship vacancy, the Board appointed Donald R. Riley as
director of the Company, effective as of July 1, 2017. Mr. Riley
was appointed as a Class III director. Mr. Riley was also
appointed as a member of the Executive Committee of the Board,
effective as of July 1, 2017, to serve on such committee until
his successor is duly appointed and qualified or until his
earlier resignation or removal.
Mr. Riley will not receive any additional compensation as a
director of the Company.
director of the Company.
Item 8.01 Other Events.
On June 6, 2017, the Company issued a press release regarding the
resignation of Mr. Chambers and the appointment of Mr. Riley as
NCIs Chief Executive Officer. A copy of the Companys press
release is attached as Exhibit 99.1 to this Form 8-K and is
incorporated herein by reference.
resignation of Mr. Chambers and the appointment of Mr. Riley as
NCIs Chief Executive Officer. A copy of the Companys press
release is attached as Exhibit 99.1 to this Form 8-K and is
incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
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(d)
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Exhibits.
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Exhibit
Number
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Description
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99.1
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Press Release dated June 6, 2017.
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About NCI Building Systems, Inc. (NYSE:NCS)
NCI Building Systems, Inc. is a manufacturer and marketer of metal products for the non-residential construction industry. The Company operates through three segments: engineered building systems, metal components and metal coil coating. The metal coil coating segment consists of cleaning, treating, painting and slitting continuous steel coils before the steel is fabricated for use by construction and industrial users. The metal components segment products include metal roof and wall panels, doors, metal partitions, metal trim, insulated panels and other related accessories. The engineered building systems segment includes the manufacturing of main frames, Long Bay Systems, and engineering and drafting. It sells engineered building systems brand names: Metallic, Mid-West Steel, A & S, All American, Mesco, Star, Ceco, Robertson, Garco, Heritage and SteelBuilding.com. The Company operates approximately 40 manufacturing facilities in the United States, Mexico and China.