Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain
Officers; Compensatory Arrangements of Certain Officers.
On August 10, 2017 the Board of Directors (the “Board”) of Energizer Holdings,
Inc. (the “Company”) announced the appointment of Timothy Gorman as Executive Vice President and Chief Financial Officer of the Company, effective immediately.
Mr. Gorman, 56, joined the Company in September 2014, and has served as the Interim Chief Financial Officer since June 8, 2017. Prior to that
Mr. Gorman served in finance and accounting leadership roles for the Company, including as Vice President of Finance, Controller and Chief Accounting Officer from July 2015 until June 2017 and Vice President, Controller – Household
Products from September 2014 to July 2015. Prior to joining the Company, Mr. Gorman worked as an independent financial consultant and in a variety of senior roles during a twenty-five year career at PepsiAmericas, Inc. (previously known as
Whitman Corporation), most recently as Senior Vice President and Controller.
In connection with Mr. Gorman’s appointment, he will receive a
base salary at an annualized rate of $520,000 per year and be eligible for a target bonus opportunity of 75% of base salary, based on the Company’s financial results for the 2017 fiscal year.
The Company also entered into a Change of Control Employment Agreement with Mr. Gorman with a term of two years. The Change of Control Agreement provides
that Mr. Gorman will receive severance compensation in the event of certain termination events (as provided in the agreement), other than for cause, death or disability, or within specified periods following a change in control of the Company,
as such terms are defined in the agreement.
Under the Change of Control Agreement, upon a change of control, Mr. Gorman will receive a pro rata
annual bonus for the portion of the year occurring prior to a change of control.
If Mr. Gorman is terminated under the termination events defined in
the Change of Control Agreement within specified periods of the change of control, the severance compensation payable under the Change of Control Agreement consists of:
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a payment equal to a multiple of the officer’s annual base salary and target bonus (defined as the most recent five-year actual bonus percentages multiplied by the greater of base salary at either termination or
change of control), which will be two times in the case of Mr. Gorman;
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a pro rata portion of Mr. Gorman’s target annual bonus for the year of termination; and
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a
lump-sum
payment intended to assist with health and welfare benefits for a period of time post-termination.
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Following termination of employment, Mr. Gorman is bound by a
one-year
covenant not to compete, a
one-year
non-solicitation
covenant, and a covenant of confidentiality.
The
description of the form of Change of Control Agreement set forth herein is a summary only and is qualified in its entirety by the full text of the form of Change of Control Agreement, a copy of which is listed as Exhibit 10.4 to the Company’s
Current Report on Form
8-K
filed July 8, 2015 and incorporated by reference herein.
On July 1, 2015,
the Company adopted an executive severance plan which provides benefits to the Company’s senior executives in the event of a “qualifying termination” as defined in the plan, which means an involuntary termination without
“cause” or a voluntary termination as a result of “good reason”. The Company does not provide employment agreements and the plan was adopted to provide executives with certain benefits in the event of a qualifying termination.
Effective upon his appointment, post-termination executive severance benefits for Mr. Gorman in the event of a qualifying termination consist of:
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a lump sum payment of two times his annual base salary (excluding bonus and incentive compensation) at the time of the qualifying termination;
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a
pro-rata
bonus payment based on the number of days during the bonus year Mr. Gorman was employed and the amount of annual bonus which the participant would have received if
he or she had remained employed, based on actual Company performance; and
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outplacement services for up to 12 months.
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The payment of benefits under the plan is conditioned upon the
executive executing a general release in favor of the Company, as well as confidentiality,
non-solicitation,
non-disparagement
and
non-competition
obligations. In addition, no benefits will be paid to the extent duplicative of benefits under a change in control or similar agreement with the Company.
The description of the plan set forth herein is a summary only and is qualified in its entirety by the full text of the plan, a copy of which is listed as
Exhibit 10.5 to Company’s Current Report on Form
8-K
filed July 8, 2015 and incorporated by reference herein.
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This description of Mr. Gorman’s compensation and benefits is qualified in its entirety by reference to
the full text of the Company’s offer letter to Mr. Gorman, attached as Exhibit 10.1 hereto and incorporated by reference herein.