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Virginia
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1-9810
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54-1701843
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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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9120 Lockwood Blvd., Mechanicsville, Virginia
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23116
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(Address of principal executive offices)
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(Zip Code)
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o
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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o
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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o
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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o
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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(1)
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Election of ten directors, each for a one-year term, as follows:
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(2)
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Approval of the Owens & Minor, Inc. 2018 Stock Incentive Plan as follows:
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Votes For
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Votes Against
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Abstentions
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Broker Non-Votes
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43,078,785
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2,892,461
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235,738
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10,191,304
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(3)
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Ratification of KPMG LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2018 as follows:
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Votes For
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Votes Against
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Abstentions
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Broker Non-Votes
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54,155,314
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2,003,606
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239,368
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10,191,304
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(4)
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Advisory vote to approve the compensation of our named executive officers as follows:
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Votes For
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Votes Against
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Abstentions
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Broker Non-Votes
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41,521,000
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4,399,019
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286,965
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10,191,304
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(d)
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Exhibits.
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10.1
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10.2
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10.3
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10.4
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10.5
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(i)
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Death
. If Participant’s membership on the Board of Directors of the Company is terminated before the expiration of the Restricted Period by reason of Participant’s death, all restrictions applicable to the shares of Restricted Stock shall immediately lapse on the date of Participant’s death and the certificate or certificates representing the shares of Common Stock shall be transferred in accordance with a beneficiary designation form provided by the Company and signed by the Participant and filed with the Company or, in the absence of such a beneficiary designation form, delivered to Participant’s estate.
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(ii)
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Termination of Membership on the Board of Directors of the Company
. Except as provided in subsection 2(d)(i) above, if Participant resigns or otherwise ceases to be a member of the Board of Directors of the Company (whether voluntary or involuntary) before the expiration of the Restricted Period, all restrictions on a pro rata number of shares of Restricted Stock shall lapse and any remaining shares shall be forfeited. The “pro rata number” shall be the number of shares of Restricted Stock multiplied by a fraction, the numerator of which is the number of months (including a fractional month) of Participant’s service as a member of the Board of Directors after the Date of Grant and the denominator of which is
[12]
. The certificate or certificates representing the shares of Common Stock upon which the restrictions have lapsed shall be delivered to Participant.
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(iii)
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Change in Control
.
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(a)
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If, upon a Change in Control, (i) the Restricted Stock is assumed by, or a substitute award granted by, the surviving entity (together with its Related Entities, the “Surviving Entity”) in the Change in Control (such assumed or substituted award to be of the same type of award as this Restricted Stock with a value as of the Control Change Date substantially equal to the value of this Restricted Stock) and (ii) Participant is not elected a member of the Surviving Entity’s board of directors as of the Control Change Date (or does not continue to serve as a member of the Surviving Entity’s board of directors for at least
[12]
consecutive months), all restrictions applicable to the shares of Restricted Stock shall immediately lapse on the Control Change Date (or the date Participant ceases to serve on the Surviving Entity’s board of directors if less than
[12]
consecutive months) and the certificate or certificates representing the shares of Common Stock upon which the restrictions have lapsed shall be delivered to Participant.
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(b)
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If, upon a Change in Control, the Restricted Stock is not assumed by, or a substitute award granted by, the Surviving Entity in the Change in Control as provided in subsection 2(d)(iii)(a) above, all restrictions applicable to the shares of Restricted Stock shall immediately lapse on the Control Change Date and the certificate or certificates representing the shares of Common Stock upon which the restrictions have lapsed shall be delivered to Participant.
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(i)
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Participant shall not be entitled to receive the certificate or certificates evidencing the Restricted Stock;
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(ii)
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Shares of Restricted Stock may not be sold, transferred, assigned, pledged, conveyed, hypothecated or otherwise disposed of; and
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(iii)
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Shares of Restricted Stock may be forfeited immediately as provided in subsection 2(d) hereof.
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(i)
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Death
. If Participant’s employment with the Company and its Affiliates is terminated before the expiration of the Restricted Period by reason of Participant’s death, all restrictions applicable to the shares of Restricted Stock shall immediately lapse on the date of Participant’s death and the certificate or certificates representing the shares of Common Stock shall be delivered to Participant’s estate.
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(ii)
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Disability
. If Participant’s employment with the Company and its Affiliates is terminated before the expiration of the Restricted Period by reason of “total and permanent disability” (as such term is defined in Section 22(e)(3) of the Internal Revenue Code of 1986, as amended (the “Code”)), all restrictions on a pro rata number of shares of Restricted Stock shall lapse. The “pro rata number” shall be the number of shares of Restricted Stock multiplied by a fraction, the numerator of which is the number of months (including a fractional month) of Participant’s employment after the Date of Grant and the denominator of which is
[36]
. The certificate or certificates representing the shares of Common Stock upon which the restrictions have lapsed shall be delivered to Participant.
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(iii)
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Retirement
. If Participant’s employment with the Company and its Affiliates is terminated before the expiration of the Restricted Period by reason of retirement (defined below), all shares of Restricted Stock shall be forfeited immediately and all rights of Participant to such shares shall terminate immediately without further obligation on the part of the Company. Notwithstanding the foregoing, if Participant’s service to the Company or an Affiliate continues from and after the date of retirement through (i) membership on the Board, (ii) a written consulting
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(iv)
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Termination of Employment by Company or Affiliate
.
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(a)
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With Cause
. If the Company or an Affiliate terminates Participant’s employment with the Company and its Affiliates with “cause,” all shares of Restricted Stock shall be forfeited immediately and all rights of Participant to such shares shall terminate immediately without further obligation on the part of the Company. For purposes of this Agreement, “cause” means: (i) misappropriation, theft or embezzlement of funds or property from the Company or an Affiliate or securing or attempting to secure personally any profit in connection with any transaction entered into on behalf of the Company or an Affiliate, (ii) conviction of, or entry of a plea of “
nolo contendere
” with respect to, a felony which, in the reasonable opinion of the Company, is likely to cause material harm to the Company’s or an Affiliate’s business, customer or supplier relations, financial condition or prospects, (iii) violation of the Company’s Code of Honor or any successor code of conduct; or (iv) failure to substantially perform (other than by reason of illness or temporary disability, regardless of whether such temporary disability is or becomes a total and permanent disability (as defined in paragraph 2(d)(ii) above), or by reason of approved leave of absence) the duties of Participant’s job.
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(b)
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Without Cause
. If Participant’s employment with the Company and its Affiliates is terminated by the Company or an Affiliate without “cause,” all restrictions on a pro rata number of shares of Restricted Stock shall lapse. The “pro rata number” shall be the number of shares of Restricted Stock multiplied by a fraction, the numerator of which is the number of months (including a fractional month) of Participant’s employment after the Date of Grant and denominator of which is
[36]
. The certificate or certificates
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(v)
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Termination of Employment by Participant
. If Participant resigns from employment with the Company and its Affiliates before the expiration of the Restricted Period, without regard to the reason for such resignation (other than death, disability or retirement as provided in subsections (i), (ii) and (iii) above), all of the shares of Restricted Stock shall be forfeited immediately and all rights of Participant to such shares shall terminate immediately without further obligation on the part of the Company.
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(vi)
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Change in Control
.
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(a)
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If, upon a Change in Control, (i) the Restricted Stock is assumed by, or a substitute award granted by, the surviving entity (together with its Related Entities, the “Surviving Entity”) in the Change in Control (such assumed or substituted award to be of the same type of award as this Restricted Stock with a value as of the Control Change Date substantially equal to the value of this Restricted Stock) and (ii) within 24 months of the Control Change Date, Participant’s employment with the Surviving Entity is terminated by the Surviving Entity without Cause (defined below), all restrictions applicable to the shares of Restricted Stock shall immediately lapse on the date of employment termination and the certificate or certificates representing the shares of Common Stock upon which the restrictions have lapsed shall be delivered to Participant.
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(b)
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For purposes of this subsection 2(d)(vi), “Cause” shall mean (i) the willful and continued failure by Participant to substantially perform his or her duties with the Surviving Entity (other than any such failure resulting from Participant’s incapacity due to physical or mental illness) after a written demand for substantial performance is delivered to Participant by the Surviving Entity, which demand specifically identifies the manner in which the Surviving Entity believes that Participant has not substantially performed his or her duties, or (ii) the willful engaging by Participant in conduct which is demonstrably and materially injurious to the Surviving Entity, monetarily or otherwise. For purposes of this paragraph, no act, or failure to act, on Participant’s part shall be deemed "willful" unless done, or omitted to be done, not in good faith and without reasonable belief that the action or omission was in the best interest of the Surviving Entity.
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(c)
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If, upon a Change in Control, the Restricted Stock is not assumed by, or a substitute award granted by, the Surviving Entity in the Change in Control as provided in subsection 2(d)(vi)(a) above, all restrictions applicable to the shares of Restricted Stock shall immediately lapse on the Control Change Date and the certificate or certificates representing the shares of Common
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(i)
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Death
. If Participant’s employment with the Company and its Affiliates is terminated before the expiration of the Holding Period by reason of Participant’s death, the Restricted Stock Unit shall immediately be earned on the date of Participant’s death and shares of Common Stock shall be issued and delivered to Participant’s estate.
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(ii)
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Disability
. If Participant’s employment with the Company and its Affiliates is terminated before the expiration of the Holding Period by reason of “total and permanent disability” (as such term is defined in Section 22(e)(3) of the Internal Revenue Code of 1986, as amended (the “Code”)), a pro rata number of Restricted Stock Units shall be earned and one share of Common Stock per earned Restricted Stock Unit shall be issued and delivered to Participant. The “pro rata number” shall be the number of Restricted Stock Units multiplied by a fraction, the numerator of which is the number of months (including a fractional month) of Participant’s employment after the Date of Grant and the denominator of which is
[36]
.
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(iii)
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Retirement
. If Participant’s employment with the Company and its Affiliates is terminated before the expiration of the Restricted Period by reason of retirement (defined below), all Restricted Stock Units shall be forfeited immediately and all rights of Participant to such shares shall terminate immediately without further obligation on the part of the Company. Notwithstanding the foregoing, if Participant’s service to the Company or an Affiliate continues from and after the date of retirement through (i) membership on the Board, (ii) a written consulting services arrangement with the Company or an Affiliate or (iii) at the discretion of the Company, a written confidentiality and non-solicitation agreement with the Company (“Post-Retirement Service”), Restricted Stock Units shall not be forfeited but shall remain outstanding until the earlier of (i) the end of the Holding Period at which time shares of Common Stock shall be issued and delivered to the Participant or (ii) the date Participant ceases to provide Post-Retirement Service at which time the Restricted Stock Units shall be forfeited. For purposes of this Section 2(c)(iii), retirement shall mean severance from the employment of the Company and its Affiliates (i) at or after the attainment of age 55 and after completing a number of years of service (the total years of service credited to Participant for purposes of determining vested or nontransferable interest in a defined benefit pension plan maintained by the Company or an Affiliate which satisfies the requirements of Section 401(a) of the Code) that, when added to Participant’s age at the time of severance from employment, equals at least 65 or (ii) at or after the attainment of age 65.
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(iv)
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Termination of Employment by Company or Affiliate
.
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(a)
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With Cause
. If the Company or an Affiliate terminates Participant’s employment with the Company and its Affiliates with “cause,” all Restricted Stock Units shall be forfeited immediately and all rights of Participant to such shares shall terminate immediately without further obligation on the part of the Company. For purposes of this Agreement, “cause” means: (i) misappropriation, theft or embezzlement of funds or property from the Company or an Affiliate or securing or attempting to secure personally any profit in connection with any transaction entered into on behalf of the Company or an Affiliate, (ii) conviction of, or entry of a plea of “
nolo contendere
” with respect to, a felony which, in the reasonable opinion of the Company, is likely to cause material harm to the Company’s or an Affiliate’s business, customer or supplier relations, financial condition or prospects, (iii) violation of the Company’s Code of Honor or any successor code of conduct; or (iv) failure to substantially perform (other than by reason of illness or temporary disability, regardless of whether such temporary disability is or becomes a total and permanent disability (as defined in paragraph 2(c)(ii) above), or by reason of approved leave of absence) the duties of Participant’s job.
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(b)
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Without Cause
. If Participant’s employment with the Company and its Affiliates is terminated by the Company or an Affiliate without “cause,” a pro rata number of Restricted Stock Units shall be earned one share of Common Stock per Restricted Stock Unit earned shall be issued and delivered to Participant. The “pro rata number” shall be the number of Restricted Stock Units multiplied by a fraction, the numerator of which is the number of months (including a fractional month) of Participant’s employment after the Date of Grant and denominator of which is
[36]
.
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(v)
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Termination of Employment by Participant
. If Participant resigns from employment with the Company and its Affiliates before the expiration of the Restricted Period, without regard to the reason for such resignation (other than death, disability or retirement as provided in subsections (i), (ii) and (iii) above), all of the Restricted Stock Units shall be forfeited immediately and all rights of Participant to such shares shall terminate immediately without further obligation on the part of the Company.
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(vi)
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Change in Control
.
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(a)
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If, upon a Change in Control, (i) the Restricted Stock Units are assumed by, or a substitute award granted by, the surviving entity (together with its Related Entities, the “Surviving Entity”) in the Change in Control (such assumed or substituted award to be of the same type of award as the Restricted Stock Units with a value as of the Control Change Date substantially equal to the
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(b)
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For purposes of this subsection 2(c)(vi), “Cause” shall mean (i) the willful and continued failure by Participant to substantially perform his or her duties with the Surviving Entity (other than any such failure resulting from Participant’s incapacity due to physical or mental illness) after a written demand for substantial performance is delivered to Participant by the Surviving Entity, which demand specifically identifies the manner in which the Surviving Entity believes that Participant has not substantially performed his or her duties, or (ii) the willful engaging by Participant in conduct which is demonstrably and materially injurious to the Surviving Entity, monetarily or otherwise. For purposes of this paragraph, no act, or failure to act, on Participant’s part shall be deemed "willful" unless done, or omitted to be done, not in good faith and without reasonable belief that the action or omission was in the best interest of the Surviving Entity.
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(c)
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If, upon a Change in Control, the Restricted Stock Units are not assumed by, or a substitute award granted by, the Surviving Entity in the Change in Control as provided in subsection 2(c)(vi)(a) above, the Restricted Stock Units shall be earned on the Control Change Date and shares of Common Stock shall be issued and delivered to Participant.
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Organizational or Functional Area(s):
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Corporate Officers
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Policy For:
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Officer Severance
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Sponsor:
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The Compensation & Benefits Committee of the Board of Directors
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1.0
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Approval, Review and Revision History
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Version
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Description of Revision
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Stakeholder/
Reviewer
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Date
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Title
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Original Policy Adopted
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2005
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Board of Directors Approved
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2015
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Board of Directors Approved
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2018
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2.0
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Purpose
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3.0
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Applicability and Scope
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4.0
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Definitions
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5.0
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Policy Statements
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Officer Position
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Severance Amount
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Severance Period
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CEO
President
Chief Operating Officer
Executive Vice President
Senior Vice President
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1.5 x the sum of:
•
Base Salary
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The lower of average Bonus paid or Target Bonus for the three calendar years prior to date of employment termination
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18 months
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Vice President
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1.0
x the sum of:
•
Base Salary
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The lower of average Bonus paid or Target Bonus for the three calendar years prior to date of employment termination
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12 months
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•
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A lump sum cash payment amount equal to the number of months in the Severance Period (
i.e.
, 12 or 18 months, as applicable) times the difference between (1) the monthly premium for continued group health plan coverage under Section 4980B of the Internal Revenue Code of 1986, as amended (the “Code”),
i.e.
, “COBRA,” for the health plan coverage in effect for the Corporate Officer and his or her dependents immediately prior to the Severance Event minus (2) the monthly premium for such coverage paid by active employees of the Company. Such payment is referred to herein as the “Welfare Benefit Payment.”
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•
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Outplacement services provided by the Company for up to six months following date of termination
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•
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Tax preparation and financial counseling services consistent with allowance during employment provided for the applicable Severance Period or until alternate employment begins
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•
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a non-compete, non-solicitation (employees and customers), non-disparagement and non-interference agreement for the benefit of the Company and its Affiliates that will apply during the Severance Period
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•
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a confidentiality agreement with respect to the Company’s and its Affiliates’ information will apply for an indefinite period
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•
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a general release of claims against the Company and its Affiliates arising out of employment
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6.0
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Standards and Procedures
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7.0
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Accountability
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8.0
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Monitoring Activities
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9.0
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Review Cycle
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10.0
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Effective Date
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•
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If the Company (or, if applicable, the successor entity thereto) determines that all or a portion of the payments and benefits provided under the policy constitute “deferred compensation” under Code section 409A and that the Corporate Officer is a “specified employee” of the Company or any successor entity thereto, as such term is defined in Code section 409A(a)(2)(B)(i), then, solely to the extent necessary to avoid the incurrence of the adverse personal tax consequences under Code section 409A, the timing of the applicable payments shall be delayed until the six-month anniversary of the Corporate Officer’s “separation from service” (as defined under Code section 409A) and the Company (or the successor entity thereto, as applicable) shall (i) pay to the Corporate Officer a lump-sum amount equal to the sum of the payments that the Corporate Officer would otherwise have received during such six-month period had no such delay been imposed, and (ii) commence paying the balance of the payments in accordance with the applicable payment schedule set forth in the policy.
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•
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If the Company (or, if applicable, the successor entity thereto) determines that (i) all or a portion of the payments and benefits provided under the policy constitute “deferred compensation” under Code section 409A, (ii) such payments and benefits are subject execution of a Release or Restrictive Agreements, and (iii) the designated period for making such payment spans two calendar years, then such payments and benefits shall be made in the second calendar year.
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•
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For purposes of Code section 409A, each installment payment and any other payment provided under the policy shall be treated as a separate payment.
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•
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To the extent required by Code section 409A, any payments to be made to a Corporate Officer upon his or her termination of employment shall only be made upon such Corporate Officer’s separation from service.
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•
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The amount of expenses eligible for reimbursement, or in-kind benefits provided, during a Corporate Officer’s taxable year may not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year. The reimbursement of an eligible expense shall be made on or before the last day of the Corporate Officer’s taxable year following the taxable year in which the expense was incurred. The right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit.
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