| Item 5.02. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On September 13, 2018, Adient plc (“Adient”) announced that Douglas G. DelGrosso will become the new President and Chief Executive Officer of Adient, with such appointment to be effective October 1, 2018 (the “Effective Date”). Mr. DelGrosso will also become a member of the Board of Directors of Adient (the “Board”). Mr. DelGrosso joins Adient from Chassix, Inc., a global, vertically integrated manufacturer of aluminum and iron cast and machined chassissub-frame automotive components, where he has served as Chief Executive Officer since January 2016.
In connection with Mr. DelGrosso’s appointment, Frederick A. (Fritz) Henderson will no longer serve as interim Chief Executive Officer of Adient, with his last day in such role being September 30, 2018. Mr. Henderson was appointed by the Board as interim Chief Executive Officer in June 2018. John M. Barth will cease serving as the interim Chairman of the Board on September 30, 2018, although Mr. Barth will remain a director. On the Effective Date, Mr. Henderson will become non-executive Chairman of the Board. The size of the Board will be increased from seven to eight directors on the Effective Date.
Mr. DelGrosso, age 56, brings to the President and Chief Executive Officer role substantial automotive industry leadership and operational expertise, including through his role at Chassix and his experience serving as president and chief executive officer of Henniges Automotive, Inc., a privately-held global automotive sealing and anti-vibration company, from August 2012 to December 2015. Mr. DelGrosso also spent five years at TRW Automotive, where he last served as vice president and general manager for the company’s global braking and suspension operations, and twenty years at Lear Corporation, where he last served as president and chief operating officer. Mr. DelGrosso served on the Board of Directors of Lincoln Educational Services Corporation (Nasdaq:LINC) from 2014 to 2015. Mr. DelGrosso earned a bachelor’s degree in mechanical engineering from Lawrence Technological University and a master’s degree in business administration from Michigan State University.
In connection with his appointment, Adient provided to Mr. DelGrosso a written offer letter (the “Offer Letter”), which was accepted by Mr. DelGrosso, and which provides for the following compensation terms for Mr. DelGrosso. Mr. DelGrosso will receive an initial base salary of $1,150,000 per year, and is eligible to participate in Adient’s performance-based cash incentive bonus program, with a target annual bonus equal to 150% of his base salary and an opportunity to earn up to 200% of base salary for performance above target, subject to the performance metrics determined annually by the Compensation Committee of the Board. Mr. DelGrosso will be eligible to receive annual long-term equity incentive awards, in the form and with applicable performance goals to be determined by the Compensation Committee of the Board and as granted in accordance with Adient’s normal equity grant practices, with a target grant date value of $7,300,000. He will also be eligible for Adient’s standard employee benefits as in effect from time to time on the same basis as generally made available to other senior management of Adient.
In addition, to compensate Mr. DelGrosso for equity awards and other dividend compensation that he had the opportunity to earn at his previous employer but that were forfeited in connection with his change in employment, Adient will grant to Mr. DelGrosso aone-time equity award in the form of performance share units (“PSUs”) issued under Adient’s 2016 Omnibus Plan with a grant date target value of $7,000,000. The PSUs will be earned and become vested based on the difference in (i) the average closing price of Adient ordinary shares over the ten trading
2
