Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Appointment of New Principal Accounting Officer
On March 17, 2020, the Board of Directors of Lydall, Inc. ("Lydall" or the
"Company") appointed John J. Tedone to the position of Vice President, Finance
and Chief Accounting Officer of the Company, effective upon the commencement of
his employment with Lydall, which will be on or about May 4, 2020 ("Start
Date"). As previously disclosed in a Form 8-K filed on January 24, 2020, James
V. Laughlan, Vice President and Chief Accounting Officer and the principal
accounting officer of the Company, gave notice of his resignation of employment
with the Company, effective February 28, 2020, to pursue another opportunity.
Mr. Tedone, age 55, will be joining Lydall from his position as Vice President,
Finance and Chief Accounting Officer of Kaman Corporation ("Kaman"), a
diversified company that conducts business in the aerospace, medical and
industrial markets (NYSE: KAMN). Mr. Tedone joined Kaman in November 2004 as
Assistant Vice President, Internal Audit and was promoted to Vice President,
Internal Audit in 2006. He transitioned to Vice President, Finance and Chief
Accounting Officer in April 2007.
Mr. Tedone will be entitled to receive the following compensation and benefits
from the Company: (i) an annual base salary of $265,000; (ii) eligibility to
participate in the Company's Annual Incentive Performance Program at 40% of his
actual paid base salary in accordance with the terms and conditions of the
program; (iii) the grant of long-term incentive stock estimated at a value of
$175,000 split equally between shares of performance-based restricted stock
covering that number of shares of the Company's common stock equal to $87,500 as
of the close of market on his Start Date and non-qualified stock options
covering that number of shares of the Company's common stock equal to $87,500,
on a Black-Scholes basis, as of the close of market on his Start Date; (iv) a
monthly car allowance of $690 and accompanying gas card; and (v) other benefits
received by similarly situated employees. The performance-based restricted stock
award and the non-qualified option grant will be granted on the close of
business of Mr. Tedone's Start Date under the Lydall 2012 Stock Incentive Plan.
In connection with his appointment, the Company and Mr. Tedone will enter into
an agreement, effective as of his Start Date (in substantially the form provided
to the Company's other executive officers), specifying the termination benefits
to which Mr. Tedone will be entitled in the event that his employment is
terminated by the Company without cause. These termination benefits include one
year of salary, bonus (calculated as the average over three prior years) and
reimbursement of health insurance premiums. If the termination occurs within 18
months following a change in control, or if Mr. Tedone terminates his employment
for good reason (as defined in the agreement) within 18 months following a
change in control, his termination benefits will be increased to two years of
salary, bonus and reimbursement of health insurance premiums, plus accelerated
vesting of his equity awards and a prorated portion of his cash target bonus for
the year of termination. The Company's obligation to provide these termination
benefits to Mr. Tedone is subject to his execution without revocation of a valid
release in substantially the form attached to the agreement. A copy of the
agreement, once executed, will be filed as an exhibit to the Company's next
periodic report.
There are no arrangements or understandings between Mr. Tedone and any other
person pursuant to which he was appointed to his positions, and Mr. Tedone is
not related to any executive officer or director of the Company. Mr. Tedone has
no direct or indirect material interest in any related party transaction
required to be disclosed pursuant to Item 404(a) of Regulation S-K of the
Securities Exchange Act of 1934, as amended.
Item 7.01 Regulation FD Disclosure
Due to the substantial cessation of North American automotive manufacturing
resulting from the impacts of COVID-19, the Company has announced the ramp-down
of four manufacturing sites in its Thermal Acoustical Solutions segment and
commenced a layoff of approximately 1,000 employees at those sites, effective
March 20, 2020. The Company's press release regarding this announcement is
included as an exhibit to this Current Report and incorporated by reference in
this Item 7.01.
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Item 9.01 Financial Statements and Exhibits
(d) Exhibits
Exhibit
Number Description of Exhibit
99.1 Press Release, dated March 20, 2020
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