SPIRIT AIRLINES, INC. (NASDAQ:SAVE) 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
(e)Adoption of Spirit Airlines, Inc. 2017 Executive Severance Plan
On August 15, 2017, acting on the recommendation of the Compensation Committee, the Board of Directors of Spirit Airlines, Inc. (the "Company") adopted the Spirit Airlines, Inc. 2017 Executive Severance Plan, with an effective date of March 14, 2017 (the “Severance Plan”). The Severance Plan supersedes all prior severance plans of the Company for terminations occurring after March 14, 2017 and replaces the Company's 2007 executive severance plan, except that the Company's 2007 executive severance plan will continue in effect with respect to those former employees, if any, who currently receive benefits thereunder. All of the Company's current named executive officers (all of which hold a senior vice president or higher position) are covered under the Severance Plan, except Robert L. Fornaro, the Company's President and Chief Executive Officer, who is entitled to severance benefits under his employment agreement, as previously filed with the Securities and Exchange Commission.
to the Severance Plan, each executive officer of the Company who holds a senior vice president or higher position is entitled to receive:
(a) in the event of an involuntary termination by the Company without cause unrelated to a change in control, (i) a cash severance amount equal to his or her annual base salary in effect on the termination date or the effective date of the Severance Plan, whichever is greater, payable in equal installments over twelve months; (ii) a continuation of COBRA coverage for twelve months; (iii) a free family travel pass on Company's flights for twelve months; and (iv) the use of a Company-owned mobile phone for up to thirty days; or
(b) in the event of an involuntary termination by the Company without cause or a voluntary termination by the executive for good reason, in each case within eighteen months following a change in control, (i) a cash severance amount equal to the sum of two times his or her annual base salary in effect on the termination date or the effective date of the Severance Plan, whichever is greater, plus two times his or her target incentive bonus (currently 70% of base salary for senior vice presidents and 80% for executive vice presidents) for the year of termination, payable in equal installments over twenty four months, (ii) his or her incentive bonus for the year of termination, prorated from the beginning of the year to the date of termination based on actual incentive plan performance as of the date of termination, (iii) outplacement services not to exceed $10,000, (iv) a continuation of COBRA coverage for twelve months, (v) a free family travel pass on Company flights for twelve months; and (vi) the use of a Company-owned mobile phone for up to thirty days.
Similar benefits, but at a lower level of cash severance payout and with certain other differences, are available under the Severance Plan for our vice presidents and director-level employees. The Company is not required to provide "gross-ups" for any applicable excise taxes.
The Severance Plan provides, with respect to participants whose employment with the Company commenced on or after September 1, 2014, that (i) the Board is permitted to terminate an officer for poor performance without triggering severance benefits; and (ii) unpaid severance benefits would be offset by compensation earned by a former employee from a new employer during the applicable severance period.
The benefits provided under the Severance Plan are in lieu of any other benefits provided under any other Company policy, plan or arrangement, including any benefits provided under any employment agreement. As a condition to receiving benefits under the Severance Plan, participants must execute a general release.
The above description is a summary of the terms of the Severance Plan and is subject to and qualified in its entirety by the terms of the Severance Plan, a copy of which is attached hereto as Exhibit 10.1 and incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits
(d)Exhibits
Exhibit No.Description
10.1 Spirit Airlines, Inc. 2017 Executive Severance Plan
Spirit Airlines, Inc. ExhibitEX-10.1 2 a2017severanceplanfinal170.htm EXHIBIT 10.1 Exhibit EXHIBIT 10.1SPIRIT AIRLINES,…To view the full exhibit click here
About SPIRIT AIRLINES, INC. (NASDAQ:SAVE)
Spirit Airlines, Inc. is an airline company. The Company’s all-Airbus fleet operates more than 385 daily flights to 56 destinations in the United States, Caribbean and Latin America. Its ultra-low-cost carrier (ULCC) business model provides low, unbundled base fares that remove components traditionally included in the price of an airline ticket. The Company offers a range of optional services, allowing customers to save by paying only for the options they choose such as bags, advance seat assignments and refreshments. The Company’s route network includes approximately 151 markets throughout North America, Central America, South America and the Caribbean. The Company operates international services to Aruba, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Haiti, Honduras, Jamaica, Mexico, Nicaragua, Panama, Peru and St. Maarten, as well as Puerto Rico and the United States Virgin Islands.