BEACON ROOFING SUPPLY INC (Form: 8-K, Received: 03/14/2022 17:14:34)

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 Exchange Act of 1934

Date of Report (Date of earliest event reported): March 10, 2022

BEACON ROOFING SUPPLY, INC.

(Exact name of Registrant as Specified in Its Charter)


Delaware	000-50924	36-4173371
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

505 Huntmar Park Drive Suite 300
Herndon, Virginia		20170
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s Telephone Number, Including Area Code: 571 323-3939

(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:

☐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))

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, $0.01 par value	BECN	NASDAQ Global Select Market

Indicate by check mark whether the registrant is an emerging growth company 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. ☐

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

Effective March 10, 2022, the Compensation Committee of the Board of Directors (the “Committee”) of Beacon Roofing Supply, Inc. (the “Company”), in connection with its recently announced Ambition 2025 strategic plan, made special awards of performance-based restricted stock units (the “A25 restricted stock units”) to a group of approximately 115 employees, consisting of the Company’s executive officers (other than the Chief Executive Officer who is not eligible for the program), other members of senior management and key operations and sales leaders. A total of 403,870 A25 restricted stock units were awarded. The awards were made to fully align executives and managers at various levels of the Company with the initiatives implemented to achieve the Company's long-term shareholder return goals set forth in the Ambition 2025 strategic plan. Employees other than executive officers received a substantial majority of the total awards. The awards were made under the Company’s Second Amended and Restated 2014 Stock Plan, and were in addition to the Company’s regularly scheduled annual long term incentive awards made on the same date. The Committee also adopted a related form of award agreement which is attached hereto as Exhibit 10.1 and is incorporated by reference herein.

The recipients included the following named executive officers, who received awards in the amounts indicated:


	No. of A25 restricted stock units awarded
Frank A. Lonegro	11,170
Jonathan S. Bennett	9,320
C. Munroe Best III	11,170
Jason L. Taylor	11,170

The A25 restricted stock unit awards consist of four equal portions, with one portion relating to a performance period ending March 31, 2024, one portion relating to a performance period ending March 31, 2025 and two portions relating to performance periods ending March 31, 2026.

•

The performance target for each performance period is the stock price estimated to be achieved by period end if the yearly and overall Ambition 2025 financial objectives are met. Each performance period’s stock price target is considered met if the Company achieves a rolling 90-calendar-day average closing price of its common stock, on any date on or prior to the end of such performance period, equal to or greater than the stock price target with respect to such performance period, each as set forth below.

•

In the event a performance period stock price target is met, half of the shares subject to such performance period shall vest immediately and the remaining half of the shares subject to such performance period shall vest on March 31, 2026.

•

The unvested portion of an award shall be forfeited to the Company upon a recipient’s termination of employment with the Company and its affiliates that occurs prior to March 31, 2026, subject to limited exceptions.


Performance period	Portion of total award	Stock price target
March 10, 2022 - March 31, 2024	25%	$70.00
March 10, 2022 - March 31, 2025	25%	$82.50
March 10, 2022 - March 31, 2026	25%	$95.00
March 10, 2022 - March 31, 2026	25%	$107.50

If any performance period’s stock price target is not met by the end of such period, and a subsequent performance period stock price target is met on or prior to the end of such subsequent performance period, then any prior performance period’s stock price targets shall be then deemed met and the shares subject to such performance period shall vest in accordance with the second bullet point above. By way of illustration, if the $70.00 stock price target was not met on or prior to March 31, 2024, no shares would vest during the first performance period and no shares, at that point, would be subject to vesting on March 31, 2026. If on a date after March 31, 2024 and on or prior to March 31, 2025, the $82.50 stock price target is met, on that date 25% of the total shares subject to the award would immediately vest, and another 25% would vest on March 31, 2026 subject to a recipient’s continuous employment until that date. The remaining 50% of the shares would still be eligible for future vesting based on achieving subsequent stock price targets.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits


Exhibit Index
Exhibit Number		Description
10.1		Form of Beacon Roofing Supply, Inc. Second Amended and Restated 2014 Stock Plan A25 Performance and Time-Based Restricted Stock Unit Award Agreement.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

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 thereunto duly authorized.


			BEACON ROOFING SUPPLY, INC.

Date:	March 14, 2022	By:	/s/ FRANK A. LONEGRO
			Frank A. Lonegro Executive Vice President & Chief Financial Officer

Exhibit 10.1

BEACON ROOFING SUPPLY, INC.

SECOND AMENDED AND RESTATED 2014 STOCK PLAN

A25 RESTRICTED STOCK UNIT AWARD AGREEMENT

(Performance and Time-based Vesting)

Grant Information:



Name:
Grant Date:
Number of RSUs Granted:
Final Vesting Date1:	March 31, 2026

1 Actual vesting subject to provisions found in Sections 5, 7 and 9 of this Agreement

A Restricted Stock Unit (RSU) Award (the “Award”) granted by Beacon Roofing Supply, Inc., a Delaware corporation (the “Company”), to the employee named above (the “Grantee”), relating to the common stock, par value $.01 per share (the “Common Stock”), of the Company, shall be subject to the following terms and conditions and the provisions of the Beacon Roofing Supply, Inc. Second Amended and Restated 2014 Stock Plan (“Plan”), a copy of which is attached hereto and the terms of which are hereby incorporated by reference:

1. Acceptance by Grantee

The receipt of the Award is conditioned upon its acceptance by the Grantee no later than 30 days from the date the Agreement was delivered, provided however, if the Grantee shall fail to accept this Award by the due date, the Grantee’s Award shall be deemed accepted by the Grantee unless the Grantee has notified the Company in writing prior to the due date that he or she declines to accept the Award.

2. Grant of RSUs

The Company hereby grants to the Grantee the Award of RSUs, as set forth above. An RSU is the right, subject to the terms and conditions of the Plan and this Agreement, to receive a distribution of a share of Common Stock for each RSU as described in Section 6 of this Agreement. The Award shall vest in accordance with Sections 5 and 9 of this Agreement.

3. RSU Account

The Company shall maintain an account (“RSU Account”) on its books in the name of the Grantee which shall reflect the number of RSUs awarded to the Grantee and any dividend equivalents paid to the Grantee as described in Section 4.

4. Dividend Equivalents

Upon the payment of any dividends on Common Stock occurring during the period preceding the date the RSUs are settled in Common Stock and distributed to the Grantee as described in Section 6, the Company shall credit the Grantee’s RSU Account with an amount equal in value to the dividends that the Grantee would have received had the Grantee been the actual owner of the number of shares of Common Stock represented by the RSUs in the Grantee’s RSU Account on that date. Such amounts shall be paid to the

Grantee in cash at the time and to the extent the RSUs are distributed to the Grantee. Any dividend equivalents relating to RSUs that are forfeited shall also be forfeited.

5. Vesting

(a) Except as described in (b), (c) and (d) below, the Grantee shall become vested in the Award as set forth below if the Grantee remains in continuous employment with the Company or its affiliates until the applicable dates described below (the applicable dates on which vesting occurs shall each be a “Vesting Date”).

(i) If the performance goal set forth on Exhibit A is met on any date on or prior to March 31, 2024, then with respect to 25% of the Award, (A) 50% of such portion shall vest on the date the performance goal is met and (B) 50% of such portion shall vest on March 31, 2026.

(ii) If the performance goal set forth on Exhibit A is met on any date on or prior to March 31, 2025, then with respect to 25% of the Award, (A) 50% of such portion shall vest on the date the performance goal is met and (B) 50% of such portion shall vest on March 31, 2026.

(iii) If the performance goal set forth on Exhibit A is met on any date on or prior to March 31, 2026, then with respect to 25% of the Award, (A) 50% of such portion shall vest on the date the performance goal is met and (B) 50% of such portion shall vest on March 31, 2026.

(iv) If the performance goal set on Exhibit A is met on any date on or prior to March 31, 2026, then with respect to 25% of the Award, (A) 50% of such portion shall vest on the date the performance goal is met and (ii) 50% of such portion shall vest on March 31, 2026.

(v) If the performance goal for any portion of the Award described in (i) or (ii) above is not met by the specified date, and the performance goal for any other portion of the Award is subsequently met, then the prior unmet performance goal shall be deemed met, in which case (A) 50% of the portion of the Award that relates to the deemed met performance goal shall vest on the date the subsequent performance goal is met and (B) 50% of such portion of the Award shall vest on March 31, 2026. No portion of an Award shall vest on or after the Final Vesting Date.

(b) If prior to March 31, 2026, the Grantee’s employment with the Company and its affiliates terminates prior to a Vesting Date due to death, disability or retirement, then the portion of the Award for which the performance goal has been met but does not vest until March 31, 2026 shall become vested on the date of such termination of employment, and the remainder of the Award shall be forfeited. For this purpose (i) “disability” means (as determined by the Committee in its sole discretion) the inability of the Grantee to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which is expected to result in death or disability or which has lasted or can be expected to last for a continuous period of not less than 12 months and (ii) “retirement” means termination of the Grantee’s employment for any reason other than cause (as determined by the Company in its sole discretion) on or after the Grantee’s attainment age of 65.

(c) If on or after March 31, 2025 and prior to March 31, 2026 the employment of a Grantee who is a party to an Executive Severance and Restrictive Covenant Agreement in the form filed as Exhibit 10.20 to the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2020 (an “Executive

Agreement”) with the Company is terminated by the Company or an affiliate without Cause or by the Executive for Good Reason (as such terms are defined in the Executive Agreement), then on March 31, 2026, the Grantee shall vest in the portion of the Award for which the performance goal has been met but does not vest until March 31, 2026, and the remainder of the Award shall be forfeited. The provisions of this Section 5(c) shall replace and supersede the provisions of Section 7(d) of the Executive Agreement with respect to this Award.

(d) The unvested portion of the Award shall be forfeited to the Company upon the Grantee’s termination of employment with the Company and its affiliates for any reason other than the Grantee’s death, disability or retirement, or a Change in Control of the Company as described in Section 9 that occurs prior to the Final Vesting Date.

The foregoing provisions of this Section 5 shall be subject to the provisions of any written employment security agreement or severance agreement that has been or may be executed by the Grantee and the Company (other than Section 7(d) of the Executive Agreement, which shall no longer be of any force or effect with respect to this Award), and the provisions in such employment security agreement or severance agreement concerning the lapse of restrictions of an Award in connection with the Grantee’s termination of employment (other than Section 7(d) of the Executive Agreement) shall supersede any inconsistent or contrary provision of this Section 5.

6. Settlement of RSUs

If a Grantee becomes vested in a portion of the Award in accordance with Section 5, the Company shall distribute to Grantee, or the Grantee’s personal representative, beneficiary or estate, as applicable, a number of shares of Common Stock equal to the number of vested RSUs subject to the vested portion of the Award. Such shares shall be delivered within 30 days following the date of vesting.

7. Forfeiture of Award

Except as described in Sections 5(b) and 5(c) and Section 9, a Grantee’s unvested Award shall be forfeited to the Company if the Grantee does not remain in continuous employment with the Company or its affiliates until the Final Vesting Date.

8. Withholding Taxes

The Grantee shall pay to the Company an amount sufficient to satisfy all minimum Federal, state and local withholding tax requirements prior to the delivery of any certificate for shares. Payment of such taxes may be made by one or more of the following methods: (a) in cash, (b) in cash received from a broker-dealer to whom the Grantee has submitted irrevocable instructions to deliver the amount of tax to the Company from the proceeds of the sale of shares subject to the Award, (c) by directing the Company to withhold a number of shares otherwise issuable pursuant to the Award with a Fair Market Value equal to the tax required to be withheld, (d) by delivery to the Company of other Common Stock owned by the Grantee that is acceptable to the Company, valued at its Fair Market Value on the date of payment, or (e) by certifying to ownership by attestation of such previously owned Common Stock.

9. Change in Control

(a) In the event of a Change in Control, as defined in the Plan, unless the Award is continued or assumed by a public company in an equitable manner, the portion of the Award for which a performance goal has already been met but does not vest until March 31, 2026 shall become fully vested immediately prior to the Change in

Control and the portion of the Award for which a performance goal has not been met shall be forfeited. The Award shall settle in accordance with Section 6.

(b) If the Award is continued or assumed by a public company in an equitable manner, then the Award shall continue to vest in accordance with its terms unless there is a Qualifying Termination within one-year following the Change in Control. If a Qualifying Termination occurs within one-year following the Change in Control, the portion of the Award for which a performance goal has already been met but does not vest until March 31, 2026 shall become fully vested immediately and be settled in accordance with Section 6 and the portion of the Award for which a performance goal has not been met shall be forfeited.

For purposes of this Section: (1) “Qualifying Termination” means the termination of a Grantee’s employment (a) by the employer for any reason other than Cause; or (b) by a Grantee who was an officer of the Company immediately prior to the Change in Control for Good Reason; (2) “Cause” means (unless otherwise expressly provided in the Grantee’s employment agreement) the termination of the Grantee’s employment following the occurrence of any one or more of the following: (a) the Grantee’s conviction of, or plea of guilty or nolo contendere to, a felony; (b) the Grantee’s willful and continual failure to substantially perform the Grantee’s duties after written notification; (c) the Grantee’s willful engagement in conduct that is materially injurious to the employer, monetarily or otherwise; (d) the Grantee’s commission of an act of gross misconduct in connection with the performance of the Grantee’s duties; or (e) the Grantee’s material breach of any employment, confidentiality, or other similar agreement with the employer that, if capable of cure, remains uncured 10 days after written notice thereof; (3) “Good Reason” means, without the Grantee’s consent, (a) a material reduction in the position, duties, or responsibilities of the Grantee from those in effect immediately prior to such change; (b) a

reduction in the Grantee’s base salary; (c) a relocation of the Grantee’s primary work location to a distance of more than 50 miles from its location as of immediately prior to such change; or (d) a material breach by the Grantee’s employer of any employment agreement between such employer and the Grantee provided, however, in all cases, a Grantee must give the Company written notice of the circumstances giving rise to the Good Reason event and 30 days to cure such circumstance.

10. Rights as Stockholder

The Grantee shall not be entitled to any of the rights of a stockholder of the Company with respect to the Award, including the right to vote and to receive dividends and other distributions, until and to the extent the Award is settled in shares of Common Stock.

11. Award Not Transferable

The Award may not be transferred other than by will or the applicable laws of descent or distribution or pursuant to a qualified domestic relations order. The Award shall not otherwise be assigned, transferred, or pledged for any purpose whatsoever and is not subject, in whole or in part, to attachment, execution or levy of any kind. Any attempted assignment, transfer, pledge, or encumbrance of the Award, other than in accordance with its terms, shall be void and of no effect.

12. Share Delivery

Delivery of shares pursuant to Section 6 will be by book-entry credit to an account in the Grantee’s name established by the Company with the Company’s transfer agent; provided that the Company shall, upon written request from the Grantee (or the Grantee’s estate or personal representative, as the case may be), issue certificates in the name of the Grantee (or the Grantee’s estate or personal representative) representing such shares.

13. Recoupment

The Grantee acknowledges and agrees that the Award shall be subject to the Company’s Incentive Compensation Recoupment Policy as in effect from time to time.

14. Administration

The Award shall be administered in accordance with such regulations as the Committee shall from time to time adopt.

15. Governing Law

This Agreement, and the Award, shall be construed, administered and governed in all respects under and by the laws of the State of Delaware.

By accepting this Agreement, the Grantee agrees to be bound by the terms hereof.


	BEACON ROOFING SUPPLY, INC.

Exhibit A

The Award is subject to the following goals:


Performance Period	Common Stock Price*

From Grant Date through 3/31/2024 (Section 5(a)(i))	≥ $70.00
From Grant Date through 3/31/2025 (Section 5(a)(ii))	≥ $82.50
From Grant Date through 3/31/2026 (Section 5(a)(iii))	≥ $95.00
From Grant Date through 3/31/2026 (Section 5(a)(iv))	≥ $107.50

* Based on a rolling 90 calendar day average closing price.