| Item 2.02 | Results of Operations and Financial Condition. |
On August 3, 2023, Quanta Services, Inc. (the “Company” or “Quanta”) issued a press release announcing its results for the fiscal quarter ended June 30, 2023. A copy of the press release is furnished herewith as Exhibit 99.1.
The information furnished in Item 2.02 of this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, and shall not be incorporated by reference in any filing under the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such a filing.
| Item 5.02(e) | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On August 1, 2023, the Company entered into employment agreements (the “Employment Agreements”) with each of Earl C. (Duke) Austin, Jr., President and Chief Executive Officer of the Company; Jayshree S. Desai, Chief Financial Officer of the Company; James Redgie Probst, Chief Operating Officer of the Company; and Derrick A. Jensen, Executive Vice President – Business Administration of the Company (collectively, the “Executives”), which amend, restate and supersede their respective prior employment agreements with the Company. Each Employment Agreement provides for an initial one-year employment term and will automatically be extended for subsequent one-year terms unless either party provides notice of non-renewal at least six months prior to the expiration of the then-current employment term.
Pursuant to the Employment Agreements, Mr. Austin, Ms. Desai, and Messrs. Probst and Jensen are entitled to annual base salaries of $1,300,000, $780,000, $900,000 and $679,800, respectively, and eligible to participate in the Company’s annual incentive plan and long-term equity incentive plan, with the applicable Executive’s annual cash incentive bonus targeted at a percentage of base salary as determined from time to time by the Company’s Board of Directors or a committee thereof. In addition, under the Employment Agreements, the Executives are eligible to participate in the incentive, savings, retirement and health and welfare benefit plans and programs generally available to other peer employees of the Company and entitled to reimbursement of reasonable and necessary business expenses incurred by the Executive in accordance with applicable Company policy.
Pursuant to the Employment Agreements, if the applicable Executive’s employment terminates due to his or her death or “disability” (as defined in the applicable Employment Agreement), then he or she (or his or her estate or beneficiaries, as applicable) will be entitled to full accelerated vesting of any outstanding equity awards covering shares of Company common stock, with performance goals applicable to any such equity award being treated in accordance with the applicable award agreement (or if the award agreement does not specify such treatment, based on actual performance through the termination date and forecasted performance for the remainder of the applicable performance period).
In addition, the Employment Agreements provide that if the applicable Executive’s employment is terminated by the Company without “cause” (and other than due to death or “disability”) or by the applicable Executive for “good reason” (each as defined in the applicable Employment Agreement) (each, a “qualifying termination”), then, subject to the Executive’s timely execution and non-revocation of a general release of claims and continued compliance with applicable restrictive covenants, the Executive will be entitled to receive:
| | • | | A lump-sum amount in cash equal to 18 months (or, for Messrs. Austin and Probst, 24 months) of the applicable Executive’s then-current base salary; |
| | • | | A pro-rated annual cash incentive bonus (based on actual performance) for the fiscal year in which the qualifying termination occurs; |
| | • | | Company-subsidized continued health insurance coverage for up to 18 months (or, for Messrs. Austin and Probst, 24 months) following the termination date; |
| | • | | Company-paid outplacement services for up to 12 months following termination (capped at $20,000); and |
| | • | | With respect to the Executive’s outstanding equity awards covering Company common stock: |
| | • | | (a) if, as of the termination date, the Executive’s length of service with the Company is (i) at least three years but fewer than five years, the Executive will be entitled to accelerated vesting of the portion of each equity award (other than an equity award subject to performance-vesting conditions) that would have vested during the 12-month period following termination, and each equity award subject to performance-vesting conditions (each, a “performance award”) will remain outstanding and eligible to vest for a period of 12 months following termination; (ii) at least five years but fewer than ten years, the Executive will be entitled to accelerated vesting of the portion of each equity award (other than a performance award) that would have vested during the 24-month period following termination, and each performance award will remain outstanding |
