Wesco Aircraft Holdings, Inc (Form: 8-K, Received: 01/09/2015 17:01:23)

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): January 9, 2015

Wesco Aircraft Holdings, Inc.

(Exact name of registrant as specified in its charter)

DELAWARE		001-35253		20-5441563
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

24911 Avenue Stanford

Valencia, California 91355

(Address of Principal Executive Offices) (Zip Code)

Registrant’s telephone number, including area code: (661) 775-7200

(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:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

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

(e) On January 9, 2015, the Compensation Committee of the Board of Directors of Wesco Aircraft Holdings, Inc. (the “Company”) approved a new Management Incentive Plan (the “MIP”), under which certain key employees, including each of the Company’s executive officers, are eligible to receive annual cash incentive awards. Under the MIP, beginning with the fiscal year ending September 30, 2015, each participant’s annual incentive award opportunity will be established by reference to a percentage of their base salary and is expected to be earned based on three separate components with the following weightings:

· Company achievement relative to annual EBITDA targets— 40%;

· Company’s achievement relative to annual cash flow targets — 40%; and

· Individual performance determinations — 20%.

Payout levels for each component will range between 0% and 200%. The foregoing description of the terms of the MIP is qualified in its entirety by reference to the text of the MIP, which is attached hereto as Exhibit 10.1 and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit Number		Description

10.1		Wesco Aircraft Holdings, Inc. Management Incentive Plan

Cautionary Statement Regarding Forward-Looking Statements

This Current Report contains forward-looking statements (including within the meaning of the Private Securities Litigation Reform Act of 1995) concerning the Company and other matters. These statements may discuss goals, intentions and expectations as to future plans, trends, events, results of operations or financial condition, or otherwise, based on current beliefs of management, as well as assumptions made by, and information currently available to, such management. Forward-looking statements may be accompanied by words such as “aim,” “anticipate,” “believe,” “plan,” “could,” “would,” “should,” “estimate,” “expect,” “forecast,” “future,” “guidance,” “intend,” “may,” “will,” “possible,” “potential,” “predict,” “project” or similar words, phrases or expressions. These forward-looking statements are subject to various risks and uncertainties, many of which are outside the Company’s control. Therefore, you should not place undue reliance on such statements.

Factors that could cause actual results to differ materially from those in the forward-looking statements include: general economic and industry conditions; conditions in the credit markets; changes in military spending; risks unique to suppliers of equipment and services to the U.S. government; risks associated with the Company’s long-term, fixed-price agreements that have no guarantee of future sales volumes; risks associated with the loss

of significant customers, a material reduction in purchase orders by significant customers or the delay, scaling back or elimination of significant programs on which the Company relies; the Company’s ability to effectively manage its inventory; the Company’s ability to successfully integrate the acquired business of Haas Group Inc. in a timely fashion; failure to realize anticipated benefits of the combined operations; risks relating to unanticipated costs of integration; risks associated with the Company’s rapid expansion; the Company’s suppliers’ ability to provide it with the products the Company sells in a timely manner, in adequate quantities and/or at a reasonable cost; the Company’s ability to maintain effective information technology systems; the Company’s ability to retain key personnel; risks associated with the Company’s international operations; fluctuations in the Company’s financial results from period-to-period; risks associated with assumptions the Company makes in connection with its critical accounting estimates and legal proceedings; the Company’s ability to effectively compete in its industry; environmental risks; risks related to the handling, transportation and storage of chemical products; the Company’s dependence on third-party package delivery companies; risks related to the aerospace industry and the regulation thereof; risks related to the Company’s indebtedness; and other risks and uncertainties.

The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties that affect the Company’s business, including those described in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other documents filed from time to time with the Securities and Exchange Commission. All forward-looking statements included in this Current Report (including information included or incorporated by reference herein) are based upon information available to the Company as of the date hereof, and the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

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.

Date: January 9, 2015	WESCO AIRCRAFT HOLDINGS, INC.


	By:	/s/ Gregory A. Hann
		Gregory A. Hann Executive Vice President and Chief Financial Officer

EXHIBIT INDEX

Exhibit Number		Description

10.1		Wesco Aircraft Holdings, Inc. Management Incentive Plan

Exhibit 10.1

MANAGEMENT INCENTIVE PLAN

PURPOSE:

The compensation strategy of WESCO Aircraft (“Company”) is to reward its managers and key employees in a manner that permits the Company to attract, retain and motivate outstanding individuals.

The Management Incentive Plan (“MIP”) is designed under the Company’s shareholder approved Incentive Award Plan to compensate managers and key employees of the Company for achieving annual Company performance objectives, as well as for individual contributions towards accomplishing these objectives. The MIP is intended to align the interests of the Company’s managers and key employees with the objectives and goals of the Company and its shareholders.

ELIGIBILITY:

Eligibility for the MIP is limited to those employees approved by the Company’s Board of Directors Compensation Committee and will typically include those positions which have a significant effect on the Company’s growth and financial results. Eligible positions and target incentive amounts will be reviewed and determined each year by the Company and may change from year to year. Participants must be full time employees of the Company in order to participate or receive payments under the MIP. A participant in the MIP will not be eligible to participate in the Employee Incentive Plan.

TARGET INCENTIVE:

For each MIP participant, there will be a target incentive (“Target Incentive”) equal to an established percentage (“Target Incentive Percentage”) of each participant’s base salary (“Base Salary”). Actual payouts will be awarded upon the achievement of external audit-confirmed and Board-approved financial targets. Actual payouts (if any) may be higher or lower than the calculated Target Incentive, based on whether the Company’s performance is above or below its financial targets and the individual’s performance during the year. A participant’s Base Salary for Target Incentive Award purposes is the participant’s salary on (i) January 1, or (ii) the date that the participant is admitted as a participant in the MIP. All awards under the MIP are granted under and subject to the terms, conditions and limitations of the Company’s shareholder approved Incentive Award Plan as then in effect. The final determination of any incentive payments must be approved by the Compensation Committee, except as otherwise provided herein.

BONUS POOL:

Each year, the Company plans for a 100% payout of the Target Incentive Award for each individual if target goals are attained. At the conclusion of the year, the CEO will propose to the Board a total pool of funds to be made available for payout of individual bonuses (“Bonus Pool”). The total Bonus Pool will be based upon the achievement of the Company’s ‘EBITDA’ and ‘Cash Flow from Operations less Capital Expenditures’ targets as well as individual performance determinations. The Company may not distribute funds in excess of the Board-approved Bonus Pool. The Target Incentive Award components are described below.

INCENTIVE COMPONENTS:

There are three components to the MIP :

COMPONENT A: EBITDA Weight 40%

A “target goal” for Company EBITDA is established annually by the Compensation Committee. There are several milestone goals both below and above the target goal that will qualify the MIP participant for an incentive award. However, an established baseline goal for must be achieved before any payout for Component A can occur. Payouts for this Component can range from 0-200% of the target goal based on actual company results.

COMPONENT B: CASH FLOW FROM OPERATIONS LESS CAPITAL EXPENDITURES Weight 40%

A target goal for the Company to increase Cash Flow from Operations less Capital Expenditures is established annually by the Compensation Committee. There are several milestone goals below and above the target goal that will qualify the MIP participant for an incentive award. However, an established baseline goal must be achieved before any payout for Component B can occur. Payouts for this Component can range from 0-200% of the target goal based on actual company results.

COMPONENT C: INDIVIDUAL PERFORMANCE Weight 20%

Individual performance considerations will vary by participant and may be a more subjective measure of the contributions of the participant to the overall success of the organization. As a measure of this component, departmental objectives or individual goals may be established. The executive leadership team may have Individual Goals, which will be approved by the Compensation Committee, in consultation with the CEO. Assessment of actual achievement levels for participants below the executive leadership team will be reviewed by the EVP and/or CEO who have the discretion to adjust (increase or decrease) the payout for each individual based upon his or her contributions to the Company’s performance. Assessment of actual achievement levels for the executive leadership team will be reviewed by the Compensation Committee (who may consult with the CEO), which has the discretion to adjust (increase or decrease) the payout for each individual based upon his or her contributions to the Company’s performance. Although achievement of individual performance is normally established at 100%, payouts for this Component can range from 0-200% of the target goal.

The components of the MIP and/or the weightings of each component may change in future years.

DETERMINATION OF AWARDS:

Except with respect to any awards that are intended to qualify as “performance based compensation” under Section 162(m) of the Internal Revenue Code, after receipt of the audited financial statements for the fiscal year ending September 30 the Company’s CEO will submit to the Compensation Committee an evaluation of the bonus earnings of each participant in the plan and the Compensation Committee shall make the final determination as to the amount of bonus that may be received by each participant. When a question arises regarding extraordinary gains or losses, for example, the impact of an acquisition (which would not have been included in the target calculation), or the operation (gain or loss) of a particular division, the Compensation Committee will have sole discretion in making any adjustments to any bonus amount.

PAYOUTS AND NEW EMPLOYEES:

Bonus awards will be paid no later than thirty (30) days following approval, which follows the completion of the fiscal year end review. A participant must be on active payroll and a full-time employee of the Company during the year AND at the time awards are distributed in order to be eligible to receive an incentive award payout. Prior to actual payment of a bonus award, no bonus will be earned under the MIP. A participant who is promoted within the fiscal year will be entitled to receive a pro-rated incentive award based upon the time spent in each position, unless otherwise determined at the time of the promotion or upon payout.

GENERAL:

Participants will be notified that they are a participant in the MIP and their participation shall continue unless the employee is terminated or transferred to other jobs not covered by the MIP. Notice of participation in the MIP shall not restrict the Company’s rights to transfer participants to other jobs or terminate their employment.

CODE SECTION 162(m)

Notwithstanding anything herein, certain senior executive Company employees may be eligible to receive awards or other compensation that is intended to qualify as “performance based compensation” for purposes of Section 162(m) of the Internal Revenue Code. All such awards or other compensation are subject to separate terms and conditions as may be determined by the Compensation Committee’s Section 162(m) Plan Subcommittee (“Subcommittee”). With respect to such compensation, all Target

Incentives, performance goals, final award determinations and other decisions will be made by the Subcommittee in a manner consistent with the requirement of Code Section 162(m), unless otherwise determined by the Subcommittee. The provisions of this paragraph and all decisions of the Subcommittee shall control over any conflicting provision of the MIP.

DISABILITY, DEATH OR SPECIAL CIRCUMSTANCES:

In the event of disability, death or special circumstances affecting a participant, the Company may, but has no obligation to, approve partial or prorated awards.

ADMINISTRATION:

The Company reserves the right to change or cancel the MIP at any time. The Company, through its Board or its delegate(s) shall have all powers and discretion necessary or appropriate to administer the MIP and to control its operation. All determinations and decisions made by the Company shall be final, conclusive, and binding on all persons, and shall be given the maximum deference permitted by law.

DISCLAIMER:

The Company is an “at will” employer and participation in the MIP is not to be construed in any way as an employment contract or agreement and does not in any way guarantee continued employment.