UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 OR 15(d)
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Explanatory Note
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On August 21, 2019, the Compensation Committee of the Company finalized and approved the compensation arrangements with Mr. Bishop in connection with his appointment as Chief Operating Officer of the Company. In connection with Mr. Bishop’s joining the Company, he will receive a one-time inducement payment of $1,000,000 to join the Company, which will be required to be repaid if Mr. Bishop voluntarily leaves the Company prior to the second anniversary of his employment; should Mr. Bishop voluntarily leave the Company between the second and third anniversary of employment, the repayment obligation will be prorated based on the percentage of time he was employed during the three-year period. In addition, Mr. Bishop will also receive a one-time long-term incentive award made pursuant to the Company’s 2017 Omnibus Equity Plan (the “Omnibus Equity Plan”) consisting of 15,580 restricted stock units vesting in January 2020 and 32,770 nonqualified stock options vesting in three-year increments beginning in January 2020. The one-time award will be forfeited and repayable to the Company if Mr. Bishop voluntarily leaves the Company prior to the second anniversary of his employment.
The Company and Mr. Bishop have also agreed to the terms of an employment agreement (the “Employment Agreement”) dated August 21, 2019, the terms of which include:
| • | Mr. Bishop’s employment with the Company as Chief Operating Officer will continue until August 21, 2021, subject to extension as set forth in the Employment Agreement; |
| • | Mr. Bishop’s salary will be $450,000 on an annualized basis; |
| • | Mr. Bishop will be eligible to receive an annual bonus under the Company’s annual cash incentive program with a target and maximum amount as determined by the Compensation Committee of the Board of Directors, beginning with fiscal year 2020. With respect to fiscal 2020, Mr. Bishop’s target incentive amount will be 70% of his salary; |
| • | Mr. Bishop will be entitled to equity awards made in the ordinary course pursuant to the Company’s Omnibus Equity Plan. For fiscal 2020, Mr. Bishop will be entitled to an award equal to 125% of his salary; and |
| • | Mr. Bishop will receive severance protection terms of one and a half times his base salary, cash incentive bonus and benefits in a non-change in control setting, and two times his base salary, cash incentive bonus and benefits in a change in control setting. |
The foregoing description of the Employment Agreement is not complete and is qualified in its entirety by reference to the Employment Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
| (d) | Exhibits. |
| Exhibit |
Description | |||
| 10.1 |
Employment Agreement, dated effective August 21, 2019, between the Company and Mr. Bishop. | |||
| 104 |
Cover Page Interactive Data File (embedded within the Inline XBRL document). | |||
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Chart Industries, Inc. | ||||||
| Date: August 23, 2019 |
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| By: |
/s/ Jillian C. Evanko | |||||
| Jillian C. Evanko, Chief Executive Officer and President | ||||||