| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangement of Certain Officers |
(e) Compensatory Arrangement of Certain Officers
Change in Control Agreement.
On June 22, 2023, Apogee Enterprises, Inc. (the “Company”) entered into a change-in-control agreement (the “Change in Control Agreement”) with Matthew J. Osberg, the Company’s Executive Vice President and Chief Financial Officer.
The Change in Control Agreement is a “double trigger” agreement. It provides that, in the event of a change in control of the Company, Mr. Osberg will have specific rights and receive specified benefits if Mr. Osberg’s employment is terminated without “cause” (as defined in the Change in Control Agreement) or Mr. Osberg voluntarily terminates his employment for “good reason” (as defined in the Change in Control Agreement) within two years after the change in control (the 10th business day following such employment termination date is referred to herein as the “Employment Termination Date”). In these circumstances, Mr. Osberg will receive a severance payment equal to two times his annual salary and target cash incentive bonus for the fiscal year (as calculated under the terms of the Change in Control Agreement). In addition, all options and restricted stock awards held by Mr. Osberg that have not vested by the Employment Termination Date will be immediately vested on such date. Following the Employment Termination Date, the Change in Control Agreement provides that, for a 24-month period following a change in control, the Company will continue to provide medical and dental insurance coverage for Mr. Osberg and his dependents or will reimburse Mr. Osberg for the cost of obtaining substantially similar benefits. No benefits will be paid to Mr. Osberg pursuant to the Change in Control Agreement unless Mr. Osberg executes and delivers to the Company a release of claims.
The Change in Control Agreement contains a “best-net-benefit” provision. This provides that, in the event that payments under the agreement trigger excise tax for Mr. Osberg, he has the option either of reducing the severance payment, if the net benefit is greater than paying the excise tax, or paying the excise tax himself.
During Mr. Osberg’s employment with the Company and for a 24-month period following Mr. Osberg’s Employment Termination Date, provided that the amounts owed to Mr. Osberg pursuant to the Change in Control Agreement have been paid, Mr. Osberg shall not: (1) solicit, directly or indirectly, any existing or prospective customers, vendors or suppliers of the Company or its affiliates for a purpose competitive to the Company’s business or to encourage such customers, vendors or suppliers to terminate business with the Company or its affiliates; (2) solicit, directly or indirectly, any employee of the Company or its affiliates to terminate his or her employment; or (3) engage in or carry on, directly or indirectly, in certain geographic markets a business competitive with the Company’s business.
The Change in Control Agreement continues through December 31 of each year and provides that it will be automatically extended for one-year terms prior to a change in control unless the Company gives prior notice of termination.
The foregoing description of the Change in Control Agreement is a summary and is qualified in its entirety by reference to the Change in Control Agreement, a form of which was filed as Exhibit 10.38 to the Company’s Annual Report on Form 10-K, which was filed with the Commission on April 30, 2018, which is attached as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Amendment to Deferred Incentive Compensation Plan.
On June 22, 2023, the Board of Directors of Apogee Enterprises, Inc. adopted the Fifth Amendment (the “Amendment”) to the Apogee Enterprises, Inc. Deferred Incentive Compensation Plan (2005 Restatement) (the “Plan”). The Amendment amended the Plan by adding a new section allowing a participant to modify the form of payment with respect to a Deferred Compensation Account (as defined in the Plan), provided (i) the modified election is submitted at least 12 months prior to the date on which payment is scheduled to commence under the election prior to the modification, (ii) the modified payment must commence no earlier than five years after the date payment would have commenced under the original election or result in an acceleration of payments (other than in case of the participant’s death); and (iii) the modified election is irrevocable upon receipt and becomes effective 12 months after the date of receipt. The foregoing description of the Amendment is a summary and is qualified in its entirety by reference to the Amendment, which is attached as Exhibit 10.2 to this Current Report on Form 8-K and is incorporated herein by reference.
| Item 5.07 | Submission of Matters to a Vote of Security Holders. |
The Company’s Annual Meeting of Shareholders (the “Annual Meeting”) was held on June 21, 2023. The four proposals voted upon at the Annual Meeting are described in detail in the Company’s Proxy Statement for the Annual Meeting filed with the Securities and Exchange Commission on May 12, 2023. The final results for the votes regarding each proposal are set forth below.
