Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On
The Compensation Committee determined that a pro-rated payout based on
performance over the first three fiscal quarters of fiscal 2020 (rather than
payout at 0% based on results for the full fiscal year) was appropriate in order
to (i) reward our management team members for their performance during the first
three fiscal quarters, when we were on track to essentially meet or exceed all
of our financial targets for fiscal 2020, prior to the unforeseen
COVID-19-related business disruptions, and (ii) recognize the important steps
our NEOs took during the fourth fiscal quarter to help manage the business
through this health and economic crisis. The Compensation Committee noted that
our NEOs quickly adapted and responded in real-time to address the effects of
the pandemic on our business and the businesses of our customers, including the
impacts of various measures taken by national, state and local governments to
attempt to contain the spread of the disease. This determination, following the
proration of the target award opportunity discussed above, resulted in an
overall payout at 94.5% of each NEO's full target award opportunity.
Accordingly, our NEOs earned the following amounts under our annual incentive
plan for fiscal 2020:
The Compensation Committee approved a similar approach for the Company's fiscal 2020 performance share awards ("PSAs"), electing to recognize the Company's performance achieved during the period before our business was negatively impacted by the effects of the COVID-19 pandemic, or our first three fiscal quarters, and then prorating the target award opportunity by three-fourths (i.e., 75% of target) to reflect the condensed period for which performance was evaluated for the first year of the three-year performance period. The fiscal 2020 PSAs are designed to represent an opportunity to earn a defined number of shares of our common stock if we achieve preset three-year compounded annual growth targets for net sales and Adjusted EBITDA including unconsolidated joint ventures, with each financial metric being equally weighted. The achievement level for fiscal 2020, after proration of the target award opportunity discussed above, will be averaged with the achievement levels of the second and third years at the end of the performance period in fiscal 2022 to determine the final number of PSAs earned.
Further information regarding the Compensation Committee's determinations and the annual incentive plan and PSAs for fiscal 2020 will be set forth in the Company's Proxy Statement for the 2020 Annual Meeting of Stockholders.
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