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) January 10, 2020
 
GP Strategies Corporation
(Exact Name of Registrant as Specified in Its Charter)
 
Delaware
(State or Other Jurisdiction of Incorporation)
 
 
 
 
 
1-7234
 
52-0845774
(Commission File Number)
 
(IRS Employer Identification No.)
 
 
 
70 Corporate Center
11000 Broken Land Parkway, Suite 200,
Columbia, MD
 
21044
(Address of Principal Executive Offices)
 
(Zip Code)
 
(443) 367-9600
(Registrant’s Telephone Number, Including Area Code)
 
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, par value $0.01 per share
GPX
NYSE (New York Stock Exchange)


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):
 
¨            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
¨            Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
¨            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
¨            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

1




Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
   
Amendment of Long-Term Incentive Program and Outstanding RSUs

On January 10, 2020, the Board of Directors (the “Board”) of GP Strategies Corporation (the “Company”) approved the recommendation of the Compensation Committee (the “Compensation Committee”) of the Board to amend the Company’s Long-Term Incentive Program (which provides for the issuance to certain key executives, including the executive officers listed in the Summary Compensation Table in the Company’s proxy statement for its 2019 Annual Meeting of Stockholders, of performance-vesting restricted stock units (“RSUs”) under the Company’s 2011 Stock Incentive Plan (the “2011 Plan”)) (the “LTIP”), and all outstanding RSUs under the 2011 Plan to provide that, to the extent not already vested or previously forfeited, all awards of RSUs will vest on the effectiveness of a Sale of the Company. The amendments define a “Sale of the Company” to be (x) the closing of a sale or other conveyance of all or substantially all of the assets of the Company or (y) the effective time of the acquisition of the Company through a merger, share exchange, consolidation, or other business combination involving the Company if immediately after such transaction persons who hold a majority of the outstanding voting securities entitled to vote generally in the election of directors of the surviving entity (or the entity owning 100% of such surviving entity) are not persons who, immediately prior to such transaction, held the outstanding securities of the Company entitled to vote generally in the election of directors. The foregoing description of the amendments to the LTIP and the outstanding RSUs is a summary and is qualified in its entirety by reference to the Amended Long-Term Incentive Program, which is included as Exhibit 10.1 to this report.
Russell Becker Salary Increase
The Board approved increasing the base annual salary of Russell Becker, the Company’s Executive Vice President - Chief Sales Officer, by $50,000 to $350,000.

Item 9.01 Financial Statements and Exhibits
 
(d) Exhibits
 




2



SIGNATURES
 

 
 
 
 
 
GP STRATEGIES CORPORATION
 
 
Date: January 16, 2020
/s/ Kenneth L. Crawford
 
Kenneth L. Crawford
 
Executive Vice President, General Counsel & Secretary


3
Exhibit 10.1

GP Strategies Corporation 2018

Amended Long-Term Incentive Program (LTIP)

Overview

The Compensation Committee of the Board of Directors of GP Strategies Corporation (the “Company”) adopted this Long-Term Incentive Plan (“LTIP”) on April 20, 2018 and it was amended by the Board of Directors on January 10, 2020. This LTIP supersedes all prior long-term incentive programs.

The Company will make any grants under this LTIP pursuant to the GP Strategies Corporation 2011 Stock Incentive Plan, as the Company may amend it from time to time (the “Plan”). The Company may amend, supplement or terminate this LTIP at any time by action of the Board of Directors or the Compensation Committee of the Board of Directors.

Overall Objectives

The Company is adopting this LTIP to (1) align the interests of our executives with those of our stockholders by rewarding the achievement of goals that reflect the delivery of value to our stockholders and (2) assist in the attraction and retention of talent critical to the Company’s success as a component in a package of total compensation that is competitive in the marketplace.

Eligible Employees

The Chief Executive Officer, President, any Executive Vice President, Senior Vice Presidents selected by the Compensation Committee or any other person that the Compensation Committee decides to include in this LTIP.

Target Awards

The target level of equity compensation for each participant is determined by multiplying the participant’s base annual salary by a number. The Company intends to make annual grants of restricted stock units to LTIP participants in the following amounts:

Level
Amount
 
 
Chief Executive Officer
1.3 x Base Annual Salary
 
 
President
1.1 x Base Annual Salary
 
 
Executive Vice President
0.8 x Base Annual Salary
 
 
Selected Senior Vice Presidents
0.6 x Base Annual Salary
 
 

The Compensation Committee will decide a target award level for any other participants it decides to add.

Performance Measure

All RSUs granted under the LTIP will have performance based vesting.

The RSUs will vest based on percentage compound annual growth rate (“CAGR”) in “Equity Value per Share” (as defined below) over a three year measurement period.

“Equity Value Per Share” means Adjusted EBITDA times the Multiplier, minus Total Debt plus Cash, divided by basic shares outstanding on the measurement date.

“EBITDA” means net income as reported by the Company plus interest, taxes, depreciation, and amortization.

“Adjusted EBITDA” means EBITDA plus non‐cash stock compensation expense, and an adjustment determined by the Committee to capture a full 12 months of EBITDA of acquired businesses during the measurement period, and other adjustments to EBITDA for other non‐recurring or non‐cash items as it determines appropriate.

“Multiplier” means the number determined by the Compensation Committee at the time it makes a grant under this LTIP.


1

The Company will calculate the foregoing using amounts stated in the Company’s audited financial statements for the relevant periods prepared in accordance with U.S. GAAP.

Performance Objectives for Vesting

At the time of granting an award under this LTIP, the Compensation Committee will establish the level of achievement on the performance measure at which 10%, 25%, 50%, 75%, 100% and 125% of the participants’ Target Award will vest.

Vesting on Change in Control of the Company

To the extent not already vested or previously forfeited, if a Change in Control (other than a Change in Control that is a Sale of the Company) occurs, such percentage of the participant’s Target Award (and corresponding RSUs) will become vested and nonforfeitable on the date of the Change in Control based on achievement of the pro rata portion of the Performance Measures relating to the portion of the Performance Period completed as of the date of the Change in Control (or as otherwise required under the terms of the Plan). The term “Change in Control” shall have the meaning set forth in the Plan. To the extent not already vested or previously forfeited, if a Sale of the Company occurs, 100% of the participant’s Target Award (and corresponding RSUs) will become vested and nonforfeitable upon the Sale of the Company.

“Sale of the Company” means any transaction that constitutes a Change in Control under clauses (ii) or (iii) of the definition of Change in Control in the Plan.

Administration

Except for the section entitled “Vesting on Change in Control of the Company” this LTIP is intended to conform in all respects with, and is subject to all applicable provisions of, the Plan. Any other inconsistencies between this LTIP and the Plan shall be resolved in accordance with the terms of the Plan. In the event of any ambiguity in this LTIP or any matters as to which this LTIP is silent, the Plan shall govern.






2