| Item 5.02. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On March 8, 2021, Emerson Electric Co. (the “Company”) and Steven J. Pelch entered into a letter agreement dated February 16, 2021 (the “Letter Agreement”) in connection with his separation from the Company, effective February 16, 2021 (the “Separation Date”).
Under the Letter Agreement, Mr. Pelch will receive salary continuation payments at his current base salary rate and certain health and welfare benefits until the earlier of November 16, 2021 or the date on which he commences other employment. He will also continue to receive his Company automobile and certain other benefits through his salary continuation period. Mr. Pelch will remain eligible to receive a pro rata payment of $267,000 as his fiscal 2021 annual bonus based on the Company’s financial performance for fiscal 2021 to be paid at the normal time under the program.
As permitted under the Company’s 2015 Incentive Shares Plan, Mr. Pelch will remain eligible to receive a full payout of any earned awards under the Fiscal 2019 – 2021 and Fiscal 2020 – 2022 Performance Shares Programs, subject to the Company’s achievement of the applicable performance objectives, to be paid at the normal times provided for under the programs. Mr. Pelch’s award under the Fiscal 2021 – 2023 Performance Shares Program has been cancelled. As permitted under the Company’s Incentive Shares Plans, Mr. Pelch’s Restricted Stock Awards will continue to vest according to their terms and be payable on the respective vesting dates of such awards. In addition, all of Mr. Pelch’s vested options will remain exercisable through October 1, 2023, their original expiration date.
Mr. Pelch will be eligible to receive distributions from the Company’s qualified pension plan, pursuant to the terms and conditions of and to be paid in the manner and at the time set for in such plan. He will also be eligible to receive distributions under the qualified and non-qualified 401(k) and profit-sharing retirement savings plans, as provided under those plans.
Mr. Pelch agrees, among other things: (i) not to compete with, or solicit or hire the employees of, the Company or any of its subsidiaries during a period of four years from the Separation Date; (ii) not to use or disclose any confidential information of the Company; (iii) to reaffirm all existing non-compete, invention, non-disclosure and non-solicitation obligations he has to the Company; and (iv) to comply with non-disparagement obligations. Mr. Pelch will also release and discharge the Company, its affiliates, and its and their respective directors, officers, employees, agents and other parties from any and all claims or liabilities of whatever nature and will remain subject to the Company’s clawback policies.
If Mr. Pelch violates any of his obligations to the Company under the Letter Agreement, he will forfeit all payments to be made or benefits provided under the Letter Agreement and will repay to the Company, as liquidated damages, one-half of the economic value of all benefits provided to him under the Letter Agreement prior to the date of breach.
The above description of the Letter Agreement is qualified in its entirety by reference to a copy of the Letter Agreement attached hereto as Exhibit 10.1.
| Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits.
