Monaco Coach Corp /DE/ - Current report filing (8-K)
22 Agosto 2008 - 4:31PM
Edgar (US Regulatory)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT
REPORT
Pursuant to
Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date of Report (Date of earliest event reported)
August 19, 2008
Monaco
Coach Corporation
(Exact name of registrant as specified in its charter)
Delaware
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1-14725
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35-1880244
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(State or Other
Jurisdiction of
Incorporation)
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(Commission File
Number)
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(IRS Employer
Identification No.)
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91320
Industrial Way,
Coburg, Oregon 97408
(Address of Principal Executive Offices, including Zip
Code)
(541) 686-8011
(Registrants telephone number, including area code)
Check the appropriate box
below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see
General Instruction A.2. below):
o
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o
Soliciting material pursuant to Rule 14a-12
under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under
the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under
the Exchange Act (17 CFR 240.13e-4(c))
Item 5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory Arrangements of
Certain Officers.
On August 19, 2008, Monaco Coach
Corporation (the Company) entered into Severance and Change in Control
Agreements (the Agreements) with its officers and certain other key managerial
personnel, including the following executive officers: Kay L. Toolson, Chairman
and Chief Executive Officer, John W. Nepute, President, P. Martin Daley, Vice
President and Chief Financial Officer, Richard E. Bond, Senior Vice President,
Secretary and Chief Administrative Officer, and Michael P. Snell, Vice
President of Sales and Marketing. These
Agreements were approved by the Compensation Committee and the Board of
Directors and provide for the following principal benefits for these five
executive officers:
Termination of Employment in the Absence of a
Change in Control
If the Company terminates the
officers employment without Cause (as defined in the Agreements) or if the
officer resigns from such employment for Good Reason (as defined in the
Agreements) before a Change in Control (as defined in the Agreements) of the
Company or more than 18 months after a Change in Control, the officer will
receive the following under his Agreement:
(i) a
lump sum payment of 12 months of base salary in the case of Mr. Toolson
and Mr. Nepute and nine months for Messrs. Daley, Bond and Snell, in
each case using the base salary in effect immediately prior to the termination
of employment or, if greater, the base salary in effect immediately prior to
the executive salary reduction implemented under the Executive Pay Reduction
Program approved by the Company on July 21, 2008; and
(ii) reimbursement for the cost of
continued COBRA premiums for the period of the severance benefit or, if sooner,
until the officer and eligible dependents become covered under similar health
insurance plans.
Termination of Employment in Connection with a Change in Control
If the Company terminates the
officers employment without Cause or if the officer resigns from such
employment for Good Reason within 18 months after a Change in Control, the
officer will receive the following under his Agreement:
(i) a lump sum severance payment in the
case of Mr. Toolson and Mr. Nepute of 200% of the sum of the
officers base salary and the average of the officers annual bonus for the
past three fiscal years and, in the case of Messrs. Daley, Bond and Snell,
150% of such amounts, in each case using the base salary which is the greater
of (A) the level in effect immediately prior to the officers termination
date, (B) the level in effect immediately prior to the Change in Control
or (C) the level in effect immediately prior to the executive salary
reduction implemented under the Executive Pay Reduction Program approved by the
Company on July 21, 2008; and
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(ii) reimbursement for the
cost of continued COBRA premiums for the period of the severance benefit or, if
sooner, until the officer and eligible dependents become covered under similar
health insurance plans.
Other
Provisions
The Agreements with Messrs. Toolson,
Nepute, Daley, Bond and Snell include non-solicitation and non-competition
covenants. The Agreements will terminate
two years after their effective dates unless extended by mutual agreement of
the parties. If a Change in Control
occurs during the term of the Agreements, the Agreements will extend
automatically through a date 18 months following the effective date of the
Change in Control. In addition, if an officer becomes entitled to benefits
under his Agreement, the Agreement will not terminate until all of the
obligations in the Agreement have been satisfied.
The terms Cause, Change in
Control and Good Reason as used in the above summary are each defined terms in
the Agreements.
In connection with the implementation of the
Agreements, the Company modified its Annual Incentive Plan (cash bonus program)
to provide that upon the occurrence of a change in control of the Company,
executives who participate in the Annual Incentive Plan will receive a
pro-rated amount of the target bonus (pro-rated to the date of the change in
control) rather than the full target bonus.
Also, beginning with awards made in 2009, performance share award agreements
under the Companys Long-Term Incentive Plan will provide that in the event of
a change in control awards will be pro-rated for payment to the date of the
change in control rather than the full target award. Additionally, the Compensation Committee determined
that the annual target performance share awards under the Long-Term Incentive
Plan will be reduced by 50% for 2009 and 2010.
The foregoing summary is qualified in its
entirety by the full terms of the Agreements, copies of which will be filed with
the Companys Quarterly Report on Form 10-Q for the third quarter.
The implementation of the Agreements is
intended to support the Companys goal of retaining critical executive talent
in a challenging business environment through competitive benefit programs.
The Company believes that the design of the Agreements reflects evolving
practices in the area of change-in-control benefits, including limited pay
multiples and excluding the frequently-used covenant to compensate
executives for potential excise taxes on their change-in-control benefits.
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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Monaco Coach Corporation
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By:
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/s/
P. Martin Daley
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P. Martin Daley
Vice President and Chief Financial Officer
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Date: August 22, 2008
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