Officemax Inc - Current report filing (8-K)
February 26 2008 - 3:49PM
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
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Date
of Report:
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February 26, 2008
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Date
of earliest event reported:
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February 20, 2008
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OFFICEMAX INCORPORATED
(Exact name of
registrant as specified in its charter)
Delaware
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1-5057
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82-0100960
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(State of
Incorporation)
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(Commission File
Number)
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(IRS Employer
Identification No.)
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263 Shuman Blvd.
Naperville, Illinois 60563
(Address of principal
executive offices) (Zip Code)
(630) 438-7800
(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:
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Written communications pursuant to Rule 425
under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12
under the Exchange Act (17 CFR 240.14a-12)
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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
1.02.
Termination
of a Material Definitive Agreement
On
October 29, 2004, we completed the sale (Sale) of our paper, forest
products, and timberland assets to affiliates of Boise Cascade, L.L.C.
(Boise). As part of this Sale, we entered into an Additional Consideration Agreement
with Boise. Pursuant to that agreement,
the proceeds from the Sale could be adjusted upward or downward based on paper
sales prices during the six years following the closing date of the Sale.
On February 22, 2008, Boise sold more than 50% of its common equity in
Boise White Paper, L.L.C, which triggered a termination provision in the
Additional Consideration Agreement.
OfficeMax and Boise are parties to various other
agreements entered into at the time of the Sale, including a paper sales
agreement, and a registration rights agreement and security holders agreement,
each of which were entered into when OfficeMax acquired securities in an
affiliate of Boise.
Item 5.02
Departure
of Directors or Certain Officers; Election of Directors; Appointment of Certain
Officers; Compensatory Arrangements of Certain Officers
2008
Annual Short-Term Incentive Program and Award Agreement
On
February 20, 2008, the Executive Compensation Committee of the board of
directors of OfficeMax Incorporated (the Company) approved the 2008 Annual
Short-Term Incentive Program and the form of the 2008 Annual Incentive Award
Agreement. Annual incentive awards for
2008 will be granted pursuant to the 2003 OfficeMax Incentive and Performance
Plan (the Plan). The committee
established bonus targets that are expressed as a percentage of salary,
objective performance criteria that must be met in order for bonuses to be
paid, and the other terms and conditions of the awards. If paid, these annual incentive awards are
paid in cash. The performance criteria
and weighting for such performance criteria applicable to these awards are:
Company EBIT dollars (50%), return on sales (30%) and same location sales
growth (20%). Bonus targets were
approved in the following amounts for our executive officers: Sam Duncan, 100%; Don Civgin, 55%; Phillip
DePaul, 50%; Sam Martin, 70%; and Ryan Vero, 55%. If the Companys financial performance
exceeds one or more of the target performance criteria, the resulting payout to
an officer may be larger than the target percentage, up to a maximum of 2.25
times target. To receive an award,
participants
must be employed by the
Company for a minimum of 90 days during the Plan year and, subject to certain
exceptions, must be employed by the Company at the time of award payment. In addition, no award will be earned or paid
if the Company does not have net income for the award period or the participant
is performing at an unsatisfactory performance level. The form of 2008 Annual Incentive Award
Agreement is filed as Exhibit 99.1 to this Report on Form 8-K and is
incorporated herein by reference. This
summary does not purport to be complete and is subject to and qualified in its
entirety by reference to the text of the 2008 Annual Incentive Award Agreement.
2008
Long-Term Incentive Program and Restricted Stock Unit Award Agreement
One
portion of the compensation to be paid to the Companys executive officers for
the fiscal year 2008 is an equity grant issued under the Plan. On February 20, 2008, the Executive
Compensation Committee of the board of directors of the Company approved the
2008 Long-Term Incentive Program and the forms of the 2008 Restricted Stock
Unit Award Agreement - Performance Based (the Performance Based RSU Award
Agreement) and the 2008 RSU Award Agreement Time Based (the Time Based RSU
Award Agreement), under which the Companys elected officers would be awarded
restricted stock units (RSU) pursuant to the Plan. Each officer will receive an award that is
divided evenly between RSUs that vest upon Company achievement of certain performance
criteria within specified time periods and RSUs that vest upon the elapsing of
a time period. Awards of RSUs were
approved in the following percentage of salary for the following executive
officers of the Company: Sam Duncan, 300% of salary; Don Civgin, 125% of
salary; Phillip DePaul, 80% of salary; Sam Martin, 150% of salary; and Ryan
Vero, 125% of salary. Mr. Duncan
voluntarily reduced his percentage of salary for this 2008 grant to 300% from
350%, despite contractual entitlement to the larger amount, in order to receive
a reduction in award commensurate with the other executive officers.
2
Awards
of performance based RSUs were approved in the following amounts for the
following executive officers of the Company: Sam Duncan, 63,210 RSUs; Don
Civgin, 13,700 RSUs; Phillip DePaul, 5,290 RSUs; Sam Martin, 19,600 RSUs; and
Ryan Vero, 13,640 RSUs. The number of
RSUs was determined based on the closing price of Company common stock on February 20,
2008. Receipt of the RSUs under the
Performance Based RSU Award Agreement is based on the Companys achievement of
a two-year cumulative EBIT measure for fiscal years 2008 and 2009. If the EBIT target is achieved, then the
final amounts received will be adjusted as follows: one half will be adjusted based on Company
Economic Value Added (EVA®(1)) Improvement for fiscal year 2008 and one half
will be adjusted based on Company EVA® Improvement for fiscal year 2009. EVA® Improvement means improvement in the
dollar value of the EVA® for the most recently completed fiscal year compared
to the dollar value of the EVA® for the next preceding fiscal year. If paid, one half of the award will vest and
be paid in February 2010 and the remaining half of the award will vest and
be paid in February 2011. Awards
are paid in shares of Company common stock.
The form of the Performance Based RSU Award Agreement provides that
participants must be employed by the Company in order for the units to vest
(subject to exceptions in certain circumstances including involuntary
termination, death, disability or retirement, in which case a pro rata amount
of units will vest and be paid after financial results are determined if the
participant was employed with the Company for a minimum of six months during
fiscal years 2008 and/or 2009). Units
may not be sold or transferred prior to vesting. In addition, recipients of the units do not
receive dividends and do not have voting rights until the units vest. In the event of a change in control, as defined in the Performance
Based RSU Award Agreement, the vesting of the RSUs may accelerate under certain
circumstances described in the agreement.
The Performance Based RSU Award Agreement includes a non-solicitation
and non-compete clause that states that, beginning on the award date and ending
one year after terminating employment with the Company, the award recipient
will not (i) directly employ or solicit for employment any person who is,
or was within six months prior to the officers termination date, an employee
of the Company or (ii) commence employment or consult (in a substantially
similar capacity to any position held with the Company during the last 12
months of employment) with any competitor engaged in the sale or distribution
of products, or in the provision of services, in competition with the products
sold or distributed or services provided by the Company in the region defined
by the Performance Based RSU Award Agreement.
The form of the Performance Based RSU Award Agreement is filed as Exhibit 99.2
to this Report on Form 8-K and is incorporated herein by reference. This summary does not purport to be complete
and is subject to and qualified in its entirety by reference to the text of the
form of Performance Based RSU Award Agreement.
Awards
of time based RSUs were approved in the following amounts for the following
executive officers of the Company: Sam Duncan, 63,210 RSUs; Don Civgin, 13,700
RSUs; Phillip DePaul, 5,290 RSUs; Sam Martin, 19,600 RSUs; and Ryan Vero,
13,640 RSUs. The number of RSUs was
determined based on the closing price of Company common stock on February 20,
2008. Pursuant to the terms of the Time
Based RSU Award Agreement, 100% of the RSUs shall vest and be paid in Company
common stock on the third anniversary of the grant date. Awards are paid in shares of Company common
stock. Units may not be sold or
transferred prior to vesting. In
addition, recipients of the units do not receive dividends and do not have
voting rights until the units vest. In the
event of a change in control, as defined in the Time Based RSU Award
(1) EVA®
is a registered trademark of Stern Stewart & Co.
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Agreement,
the vesting of the RSUs may accelerate under certain circumstances described in
the agreement. The Time Based RSU Award
Agreement includes a non-solicitation and non-compete clause that states that,
beginning on the award date and ending one year after terminating employment
with the Company, the award recipient will not (i) directly employ or
solicit for employment any person who is, or was within six months prior to the
officers termination date, an employee of the Company or (ii) commence
employment or consult (in a substantially similar capacity to any position held
with the Company during the last 12 months of employment) with any competitor
engaged in the sale or distribution of products, or in the provision of
services, in competition with the products sold or distributed or services
provided by the Company in the region defined by the Time Based RSU Award
Agreement. The form of the Time Based
RSU Award Agreement is filed as Exhibit 99.3 to this Report on Form 8-K
and is incorporated herein by reference.
This summary does not purport to be complete and is subject to and
qualified in its entirety by reference to the text of the form of Time Based
RSU Award Agreement.
Salary
Increases for Named Executive Officer
On
February 20, 2008, the Executive Compensation Committee of the board of
directors of the Company approved an increase in Sam Duncans annual base
salary to $1,030,000, effective in April 2008:
Item 9.01
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Financial
Statements and Exhibits.
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(d) Exhibits.
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Exhibit 99.1
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Form of 2008 Annual
Incentive Award Agreement
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Exhibit 99.2
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Form of 2008
Restricted Stock Unit Award Agreement (Performance Based)
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Exhibit 99.3
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Form of 2008
Restricted Stock Unit Award Agreement (Time Based)
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4
SIGNATURE
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.
Dated: February 26,
2008
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OFFICEMAX INCORPORATED
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By:
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/s/ Matthew R. Broad
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Matthew
R. Broad
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Executive
Vice President and General
Counsel
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EXHIBIT INDEX
Number
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Description
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99.1
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Form of 2008 Annual Incentive Award Agreement
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99.2
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Form of 2008 Restricted Stock Unit Award Agreement (Performance
Based)
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99.3
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Form of
2008 Restricted Stock Unit Award Agreement (Time Based)
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