UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K
CURRENT REPORT

Pursuant to Section 13 or 15(d) of The Securities Act of 1934

Date of Report (Date of earliest event reported):  August 17, 2016


LSI INDUSTRIES INC.
(Exact name of Registrant as specified in its Charter)


Ohio
 
01-13375
 
31-0888951
(State or Other Jurisdiction of Incorporation)
 
(Commission File Number)
 
 
(IRS Employer Identification No.)

10000 Alliance Road, Cincinnati, Ohio
45242
(Address of Principal Executive Offices)
(Zip Code)

Registrant's telephone number, including area code   (513) 793-3200



(Former name or former address, if changed since last report.)

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))


 
Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.


(e)   On August 17, 2016, the Compensation Committee (the "Committee") of the Board of Directors of LSI established annual salaries and determined cash bonuses for the Company's executive officers as follows:


Name
Fiscal 2016
Cash Bonus
 
Fiscal 2017 Base Salary
(effective 9/1/16)
       
Dennis W. Wells
$516,395
 
$560,000
President and Chief Executive Officer
     
       
Ronald S. Stowell
$97,850
 
$400,608
Vice President, Chief Financial Officer &
     
Treasurer
     
       
Shawn M. Toney
$82,476
 
$337,665
President, and President of
     
LSI Lighting Segment
     
       
Jeff A. Croskey
$47,004
 
$288,660
President, LSI Graphics Segment
     
and President, Grady McCauley Inc.
     
       
Andrew J. Foerster
$71,506
 
$295,622
Executive Vice President and
     
Chief Technology Officer
     

Bonus payments to Messers. Stowell, Toney, McCauley and Foerster were paid pursuant to LSI's Fiscal Year 2016 Named Executive Officer Incentive Compensation Plan (the "2016 Incentive Plan"). The 2016 Incentive Plan provides for cash bonus awards to the Company's named executive officers that are driven by the achievement of defined key performance indicators which reflect the Registrant's operating results.  A graduated scale of bonus potential stated as a percentage of base salary is identified  at indicated levels of achievement of key performance indicators. Ten percent of the bonus potential for a named executive officer is discretionary and to be determined by subjective measures. As the 2016 Incentive Plan does not apply Mr. Wells, the Committee determined Mr. Wells' incentive compensation in its discretion and pursuant to his employment agreement.

The Committee also revised the LSI Industries Inc. Short Term Incentive Plan for Named Executive Officers - - FY2017 to also cover the FY2017 incentive for the Company's Chief Executive Officer.  This revised plan is included as Exhibit 10.1 to this Form 8-K.

Item 9.01 Financial Statements and Exhibits.
 
 
(a)
Financial statements of business acquired. Not applicable.
 
 
(b)
Pro forma financial information. Not applicable.
 
 
(c)
Shell company transactions. Not applicable
 
 
(d)
Exhibits
 
 
Exhibit No .
 
  
 
Description
 
10.1
 
LSI Industries Inc. Short Term Incentive Plan for Named Executive Officers - - FY2017 (Revised August 17, 2016)


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.
   
LSI INDUSTRIES INC.
     
   
BY: /s/ Ronald S. Stowell
   
Ronald S. Stowell
   
Vice President, Chief Financial Officer and Treasurer
   
(Principal Financial and Accounting Officer)
August 22, 2016
   

 
Exhibit 10.1



LSI INDUSTRIES INC.
SHORT TERM INCENTIVE PLAN (STIP)
FOR NAMED EXECUTIVE OFFICERS
FY 2017















Document date: (Revised) August 17, 2016






           LSI INDUSTRIES INC.
SHORT TERM INCENTIVE PLAN  FOR NEOs -- FY 2017
(Revised) August 17, 2016
The Short Term Incentive Plan (STIP) for Named Executive Officers for Fiscal 2017 is designed to incentivize Named Executive Officers towards the attainment the 2017 Business Plan goals for sales and operating income. This STIP has been approved by the Compensation Committee of the LSI Board of Directors and provides for cash incentive awards to be paid if the stated 2017 Business Plan objectives are achieved.  There are three elements of this STIP.

1.
Bonus Potential determines the percentage payout to named executive officers based on the attainment of the FY 2017 Business Plan goals and as approved by the Compensation Committee in the table below.

 
75% Plan
Achievement
100% Plan Achievement
130% Plan Achievement
Chief Executive Officer
25%
90%
190%
All Other NEOs
14%
30%
60%



2.
Performance Mix determines the percentage assigned to the performance of the total company vs. the employees Business Unit.
 
Chief Executive Officer and All Other Named Executive Officers
100% Corporate Performance


3.
Metrics determine the percentage assigned to Net Sales vs. Operating Income.  In FY 2016 the STIP was based upon attainment of the Net Sales goals (30% weighting) and Operating Income goals (70% weighting).  These metrics remain the same for FY 2017.

Metrics%
FY 2016
FY 2017
Sales
30%
30%
Operating Inc.
70%
70%
Total
100%
100%












The following is provided for illustrative purposes:
Example Calculation:  Named Executive Officer
       
                 
         
Bonus
Performance
Sales / OI
Incentive
   
Plan
Actual
% of Plan
Potential
Mix
Metric
Payout
Corporate
             
Sales
 
 $500,000
 $520,000
104.0%
34.0%
100.0%
30.0%
10.20%
 
Operating Income
 $50,000
 $51,000
102.0%
32.0%
100.0%
70.0%
22.40%
                 
                 
             
Total Payout Percentage
32.60%
                 
             
Annual Base Salary
 $100,000
           
 
Bonus Payment
 $32,600

The following rules govern this STIP:

A.
This STIP covers only the Chief Executive Officer and Named Executive Officers (together referred to as "Named Executive Officers") as identified by the Compensation Committee.

B.
This STIP will take into account LSI total results. The intent of having corporate performance as a determinant of the incentive payment is to provide motivation for Named Executive Officers to work for the good of the whole corporation, not only for the good of a Business Unit.

C.
The Compensation Committee may make modifications of the calculated bonus award to decrease or increase a Named Executive Officer's bonus for special objectives or subjective circumstances.

D.
Determination of achievement of LSI's Sales and Operating Income will be calculated based upon actual reported fiscal 2017 results and may be adjusted for certain unusual or non-recurring items as approved by the Compensation Committee.  There will be a straight line interpolation of actual achievement as compared to the fiscal 2017 business goals when determining the actual incentive payment percentage.

E.
Incentive pay recipients must be employed at LSI on the day when incentive checks are issued for the fiscal year just recently ended.  Named Executive Officers who terminate employment on or before the August bonus payment date are not eligible for a bonus.

F.
Any type of lengthy leave of absence could result in a pro-rata reduction of the calculated award.  Leaves of absence include time away from work for reasons of short term disability, FMLA leave, military leave, or other leave of absence.

G.
Named Executive Officers who retire during the fiscal year at normal retirement age or under an LSI approved plan of retirement will be considered for a pro-rated payment based upon the actual amount of base salary received in the fiscal year.

H.
If a Named Executive Officer becomes disabled (as defined by Social Security) or dies during a fiscal year, his beneficiary will be considered for a pro-rata payment based upon the actual amount of base salary received in the fiscal year.

I.
Incentive payments are subject to assignment laws and other laws that require payment of the bonus to someone other than the Named Executive Officer (IRS tax levies, child support arrearages, etc.).  LSI will comply with all applicable assignment laws.

J.
Except as may be otherwise determined by the Compensation Committee, the Sales and Operating Income metrics in this STIP shall exclude the positive and negative effects of extraordinary developments, such as acquisitions, as disclosed in LSI's Form 10-K.

K.
LSI reserves the right to amend, reduce, modify, interpret or discontinue all or part of this STIP with or without reason as the Compensation Committee deems advisable in its sole and absolute discretion.

L.
This STIP does not create or imply the existence of a contract of employment.

M.
The Named Executive Officer's base salary rate as of January 1, 2017 shall be used to calculate the bonus amount.