| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangement of Certain Officers |
On May 12, 2022, ManTech International Corporation (Company) entered into amendments (Amendments) to the Executive Continuity and Stay Incentive Agreements (ECSI Agreements) with the Company’s named executive officers. Prior to these amendments, the ECSI Agreements provided for an unvested right to a fixed cash payment (Award) in the event of an automatic conversion of the Company’s Class B Common Stock into shares of the Company’s Class A Common Stock resulting from the death of the Company’s co-founder, George J. Pedersen, pursuant to Section 4.2(e)(5)(i) of the Company’s Second Amended and Restated Certificate of Incorporation (Charter).
Under the terms of the Amendments, a “Triggering Event” for the purposes of the ECSI Agreements is defined to mean a Conversion Event or a Change in Control. A Conversion Event is defined under the Amendments as an automatic conversion of the Company’s Class B Common Stock into shares of the Company’s Class A Common Stock resulting from the death of Mr. Pedersen, pursuant to Section 4.2(e)(5)(i) of the Company’s Charter. The definition of a “Change in Control” in the ECSI agreements remains unchanged, and is deemed to have occurred upon the following events: (i) the acquisition of beneficial ownership of 50% or more of the outstanding voting power of the Company’s stock, subject to certain exceptions; (ii) if the Company’s incumbent members of the Board at the beginning of any two-year period cease, for any reason, to constitute a majority of the Board, subject to certain exceptions; (iii) consummation of a reorganization, merger, or consolidation or sale or other disposition of all or substantially all of the assets of the Company, subject to certain exceptions; or (iv) approval by the Company’s stockholders of a complete liquidation or dissolution of the Company. The Company’s previously announced proposed merger in which the Company will be acquired by Moose Bidco, Inc., a Delaware corporation, which will be controlled by investment funds managed by The Carlyle Group Inc. (Merger), would constitute a Change in Control under the ECSI Agreements if completed.
The Amendments provide that, except as otherwise specified in the ECSI Agreements, if a Conversion Event occurs during the Term (as defined in the ECSI Agreements) and no Change in Control has occurred prior to the Conversion Event, the Award will be paid to the executive officer on the first anniversary of the Conversion Event, subject to the executive officer’s continued employment through such first anniversary. Notwithstanding the foregoing, the Amendments provide that (i) if a Change in Control occurs during the Term and after a Conversion Event, but prior to the first anniversary of the Conversion Event, the Award will be paid to the executive officer in a lump sum on the closing of the Change in Control (subject to the executive officer’s continued employment through the closing of the Change in Control); and (ii) if the executive officer’s employment is terminated in a Qualifying Termination (as defined in the ECSI Agreements) during the Term and after a Conversion Event, but prior to the first anniversary of the Conversion Event, the Award will be paid to the executive officer in a lump sum within 30 days after the date of the Qualifying Termination. For the purposes of the ECSI Agreements, a “Qualifying Termination” means a termination of the executive officer’s employment by the Company other than for Cause and not due to the executive officer’s death or disability. “Cause” will be deemed to exist if the executive officer: (i) has been indicted for committing an act of fraud, embezzlement, theft or other act constituting a felony; (ii) willingly engages in illegal conduct or gross misconduct that significantly and adversely affects the Company; (iii) is unable to maintain a security clearance that is required and essential for the performance of the executive officer’s duties; or (iv) fails to perform the material duties of his or her position (subject to notice and/or cure periods in certain cases).
The Amendments further provide that if a Change in Control occurs during the Term and prior to a Conversion Event, the Award will be paid to the executive officer in a lump sum on the closing of the Change in Control (subject to the executive officer’s continued employment through the closing of the Change in Control).
Under the terms of the Amendment to the ECSI Agreement with Judith L. Bjornaas, the amount of the Award is increased from $1.2 million to $2.2 million. Under the terms of the Amendment to the ECSI Agreement with Bonnie Cook, the amount of the Award is increased from $700,000 to $1.2 million. The amounts of the Awards specified in the ECSI Agreements with Kevin M. Phillips and Matthew A. Tait remain unchanged.
The foregoing description of the Amendments is only a summary, does not purport to be complete and is subject to, and qualified in its entirety by, reference to the full text of the Form of Executive Continuity and Stay Incentive Agreement that is filed as an exhibit to the Company’s Annual Report on Form 10-K and the Form of Amendment to Executive Continuity and Stay Incentive Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
