Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Approval of Amended and Restated Hostess Brands, Inc. 2016 Equity Incentive Plan
As described in Item 5.07 of this Current Report on Form 8-K, on June 8, 2022, at its 2022 annual meeting of stockholders (the “Annual Meeting”), the stockholders of Hostess Brands, Inc. (the “Company”) approved changes to the Hostess Brands, Inc. 2016 Equity Incentive Plan (the “2016 Equity Incentive Plan”) pursuant to the Amended and Restated Hostess Brands, Inc. 2016 Equity Incentive Plan (the “Amended Incentive Plan”). The principal changes made by the Amended Incentive Plan are:
| | • | | increase the number of shares of Class A Common Stock, par value $0.0001 per share (the “Shares”) reserved for issuance to 8,137,836 Shares, which is equal to the sum of: (i) 1,293,810 Shares, which is the number of Shares that could have been issued under the 2016 Equity Incentive Plan as of March 31, 2022; (ii) 2,844,026, which is the number of Shares subject to outstanding awards under the 2016 Equity Plan as of March 31, 2022; and (iii) 4,000,000 additional Shares; |
| | • | | remove certain provisions that were implemented to ensure the Company’s ability to take maximum deductibility under a performance-based compensation exception to Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), that was repealed in connection with changes under the Tax Cuts and Jobs Act; |
| | • | | maintain a limit on the number of Shares that may be subject to (i) stock options, (ii) stock appreciation rights, (iii) restricted stock awards, (iv) restricted stock units, or (v) other stock-based awards, in each case, granted to any participant in the Plan that is not a non-employee director in any year at 1,000,000 Shares, and for restricted stock awards, restricted stock units, or other stock-based awards, expanded the limitation so that applies to time-based awards in addition to the performance-based awards limitation that was included in the 2016 Equity Incentive Plan; |
| | • | | remove the ability to grant dividends or dividend equivalent rights on Shares underlying stock options and share appreciation rights; and |
| | • | | extend the term of the 2016 Equity Incentive Plan from July 26, 2026, to June 8, 2032. |
For a further description of the terms and conditions of the Amended Incentive Plan, as approved by stockholders, see “Proposal 2: Amended and Restated Hostess Brands, Inc. 2016 Equity Incentive Plan” in the Company’s Proxy Statement, as filed with the Securities and Exchange Commission on April 29, 2022 (the “Proxy Statement”), which description is incorporated herein by reference.
The foregoing description of the Amended Incentive Plan, including the description contained in the Proxy Statement, is qualified in its entirety by reference to the full text of the Amended Incentive Plan, a copy of which is filed herewith as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
Approval of Hostess Brands, Inc. 2022 Employee Stock Purchase Plan
As described in Item 5.07 of this Current Report on Form 8-K, on June 8, 2022, at the Annual Meeting, the stockholders of the Company approved the Hostess Brands, Inc. 2022 Employee Stock Purchase Plan (the “ESPP”).
The ESPP is a broad-based plan intended to qualify as an employee stock purchase plan under Section 423 of the Code (“Section 423”). Favorable tax treatment is available for United States tax residents participating in a Section 423 plan. The ESPP also authorizes the grant of rights to purchase Shares that do not qualify under Section 423 pursuant to rules, procedures or sub-plans adopted by the plan administrator to achieve tax, securities law or other compliance objectives in particular locations outside of the United States. The ESPP provides employees with the right to purchase Shares through payroll deduction. A total of 3,000,000 Shares have been reserved for issuance under the ESPP.
For a further description of the terms and conditions of the ESPP, as approved by stockholder see “Proposal 3: Hostess Brands, Inc. 2022 Employee Stock Purchase Plan in the Company’s Proxy Statement, which description is incorporated herein by reference.
The foregoing description of the ESPP, including the description contained in the Proxy Statement, is qualified in its entirety by reference to the full text of the ESPP, a copy of which is filed herewith as Exhibit 10.2 to this Current Report on Form 8-K and incorporated herein by reference.
