vishay_8k.htm
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 18, 2010
| Vishay Intertechnology,
Inc. |
|
|
| (Exact name of registrant as specified
in its charter) |
| Delaware |
1-7416 |
38-1686453 |
| (State or other jurisdiction |
(Commission |
(I.R.S. Employer |
| of incorporation) |
File Number) |
Identification
No.) |
| 63 Lancaster Avenue |
|
| Malvern, PA
19355 |
19355-2143 |
| (Address of principal executive
offices) |
(Zip
Code) |
| Registrant’s telephone number, including area code
610-644-1300 |
| |
| (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.
On March 18, 2010,
the Compensation Committee of the Board of Directors approved certain changes in
the employment arrangements for Dr. Gerald Paul, the Registrant’s President and
Chief Executive Officer, and the Board of Directors approved certain changes in
the employment arrangements of Dr. Felix Zandman, the Registrant’s Executive
Chairman of the Board, Chief Technical and Business Development Officer, Mr.
Marc Zandman, the Registrant’s Vice-Chairman of the Board, and Chief
Administration Officer, and President - Vishay Israel Ltd., and Dr. Lior
Yahalomi, the Registrant’s Executive Vice President and Chief Financial Officer,
upon the recommendation of the Registrant’s Compensation Committee. These
arrangements (other than changes in base salaries) are expected to be included
in amendments to the employment agreements of these executive officers.
No change was made to
the executive compensation arrangements of Mr. Ziv Shoshani, Executive Vice
President, Vishay Precision Group, who is expected to terminate his employment
with the Registrant and become the Chief Executive Officer of Vishay Precision
Group, Inc. following the contemplated spin-off of that company from the
Registrant. See “The Spin-Off of Vishay Precision Group—Arrangements with
Expected Vishay Precision Group Directors and Officers” below for information
concerning Mr. Shoshani’s compensation arrangements with Vishay Precision Group
following consummation of the spin-off.
Base Salaries
The base salaries for
2010 are set forth below.
| Name |
Positions Held |
2010 Base Salary |
| Dr. Felix Zandman |
Executive Chairman of the Board, Chief Technical and Business
Development Officer |
$975,000(a) |
| Dr. Gerald
Paul |
President and Chief
Executive Officer |
€752,776
(approximately
$1,104,000)(a)(b) |
| Marc
Zandman |
Vice-Chairman of the Board,
Chief Administration Officer, and President - Vishay Israel Ltd. |
NIS 1,866,750
(approximately
$475,000)(c) |
| Dr. Lior Yahalomi |
Executive Vice President and Chief Financial Officer |
$417,000 |
| Ziv
Shoshani |
Executive Vice President,
Vishay Precision Group |
NIS
1,201,329
(approximately
$305,000)(a)(c)(d) |
| |
(a) |
|
No change versus
prior year. |
|
|
|
|
|
(b) |
|
Salary will be
paid in Euro |
|
|
|
|
|
(c) |
|
Salary will be
paid in Israeli shekels |
|
|
|
|
|
(d) |
|
Until the
proposed spin-off occurs. |
|
|
|
Annual Cash Incentive Programs
The employment
agreements of Mr. Marc Zandman and Dr. Yahalomi will be amended to provide for
changes to their annual cash incentive bonus.
Mr. Marc Zandman’s
target bonus will be 50% of base salary with no minimum and a maximum bonus of
200% of base salary. Performance goals for purposes of the annual bonus award
will be recommended by the Chief Executive Officer and approved by the
Compensation Committee.
Dr. Yahalomi’s target
bonus will be 50% of base salary with no minimum and a maximum bonus of 200% of
base salary. Performance goals for purposes of the annual bonus award will be
recommended by the Chief Executive Officer and approved by the Compensation
Committee.
Long-term Equity Incentives
The employment
agreements of the Registrant’s executive officers will be amended to provide for
annual grants of equity-based compensation in the form of restricted stock
units. Of the total equity-based compensation grant, 25% will be in the form of
time-vested restricted stock units (“RSUs”) that carry only a service condition.
The remaining 75% of the grant will be in the form of performance-vested
restricted stock units, or performance stock units (“PSUs”). The PSUs will vest
if certain defined performance criteria established by the Registrant’s
Compensation Committee are realized. The grants will be made pursuant to the
Vishay Intertechnology 2007 Stock Incentive Program. They will be based upon a
percentage of base salary for the then current year as follows:
| Name |
|
LTI Value |
| Dr. Felix Zandman |
|
160% of
base salary |
| Dr. Gerald Paul |
|
150% of
base salary |
| Marc Zandman |
|
100% of
base salary |
| Dr. Lior Yahalomi |
|
100% of
base salary |
The number of units
granted annually to each executive will be determined by multiplying the
executive's base salary for the applicable year by the respective percentage set
forth above and dividing by the closing price of the Registrant’s common stock
on the New York Stock Exchange on the last trading day preceding January 1 of
the applicable year. For the purpose of the 2010 grants only, however, the total
number of units was calculated based on a market price in proximity to the date
of approval of the new long-term equity incentives. The RSUs and PSUs will
time-vest on January 1 of the third year following grant, with the performance
vesting of the PSUs to occur on the date that the Compensation Committee
certifies that the performance criteria have been satisfied.
The grants for 2010
under these new equity compensation arrangements, which will time-vest on
January 1, 2013, are as follows:
| Name |
|
RSUs Granted |
|
PSUs Granted |
|
Total Units |
|
|
|
|
|
|
|
Granted |
| Dr. Felix Zandman |
|
37,000 |
|
111,000 |
|
148,000 |
| Dr. Gerald Paul |
|
39,000 |
|
118,000 |
|
157,000 |
| Marc Zandman |
|
11,000 |
|
34,000 |
|
45,000 |
| Dr. Lior Yahalomi |
|
10,000 |
|
30,000 |
|
40,000 |
Other
Dr. Paul will receive
a special one-time equity-based compensation grant, representing $500,000 in
value. The onetime equity based compensation grant will be in the form of
time-vested restricted stock units, which will vest on January 1, 2013. The
grant is being made in consideration of Dr. Paul’s having lead the company
through the recent recession successfully while building cash.
The Spin-Off of Vishay Precision Group
As previously
announced, the Registrant intends to spin-off its precision measurement and foil
resistors businesses into an independent, publicly-traded company to be named
Vishay Precision Group, Inc.
Special Transaction Bonuses
The Board of
Directors approved special transaction bonuses related to the Vishay Precision
Group spin-off. Upon the successful completion of the spin-off, Dr. Paul, Dr.
Yahalomi, and Mr. Marc Zandman will each receive a $500,000 cash bonus.
See “Arrangements
with Expected Vishay Precision Group Directors and Officers” below for
incentives to Mr. Shoshani for the successful completion of the Vishay Precision
Group spin-off.
Arrangements with Expected Vishay Precision Group Directors and Officers
The Registrant’s
Strategic Affairs and Compensation Committees recommended to the Registrant’s
Board of Directors the terms of the compensation of the executive officers and
chairman of the board of Vishay Precision Group, to become effective upon
consummation of the spin-off, as reflected in term sheets. On March 18, 2010,
the Registrant’s Board of Directors approved the term sheets. These include Mr.
Ziv Shoshani and Mr. Marc Zandman, both of whom are currently executive officers
of the Registrant.
Ziv Shoshani
Upon consummation of
the spin-off, Mr. Shoshani will become the President and Chief Executive Officer
of Vishay Precision Group, Inc. It is anticipated that Mr. Shoshani will enter
into a three-year employment agreement with Vishay Precision Group following the
spin-off. The following is a summary of the terms of Mr. Shoshani’s employment
arrangements with Vishay Precision Group, as well as certain other compensation
that he will be eligible to receive in connection with the spin-off
Cash compensation. Mr. Shoshani will receive a base salary of
$420,000, payable in Israeli currency based on the average exchange rate during
the preceding calendar year. In addition, he will be eligible for an annual cash
performance bonus. His target bonus will be 75% of base salary with no minimum
and a maximum bonus of 200% of base salary. Performance goals for purposes of
the annual bonus award will be established each year by the compensation
committee of Vishay Precision Group.
Equity compensation. Mr. Shoshani will be entitled to receive an
annual long-term equity incentive award with a target value equal to 100% of
base salary. The form of the annual equity award will be as determined by the
compensation committee of Vishay Precision Group. Mr. Shoshani will also receive
a founder’s equity grant having a total value of $800,000. The grant will take
the form of Vishay Precision Group restricted stock units (RSUs), all of which
will vest three years from the distribution date. The RSUs will also vest on a
change of control and in certain other circumstances to be determined by the
compensation committee of Vishay Precision Group. These equity grants will be
made pursuant to the Vishay Precision Group 2010 Stock Incentive Program, which
is expected to be adopted prior to the spin-off.
Special bonuses. Mr. Shoshani will receive from Vishay
Precision Group a cash sign-on bonus of $400,000 upon consummation of the
spin-off. Mr. Shoshani will be obligated to repay this bonus if he terminates
his employment with Vishay Precision Group during the initial three-year term of
his employment contract, other than termination for good reason, death or
disability. Mr. Shoshani will also receive a one-time cash bonus from the
Registrant in the amount of $600,000 upon the successful completion of the
spin-off.
Severance. If Mr. Shoshani’s employment is terminated
without cause or if he terminates his employment with Vishay Precision Group for
good reason, he will be entitled to receive cash severance in an amount equal to
two years’ base salary plus a prorated amount of this target bonus for the year
of termination. Mr. Shoshani will also be entitled to a customary continuation
of benefits. Mr. Shoshani will not be entitled to a tax gross up in respect of
any parachute payment tax imposed on his severance benefits, and, if a tax of
this nature would otherwise be imposed, the severance payments will be cut back
to the extent necessary to avoid this tax.
Other. Mr. Shoshani will be entitled to such other
benefits, including retirement benefits, as may be approved by the compensation
committee of Vishay Precision Group following the spin-off. He will also be
subject to a customary non-competition agreement for a period of two years
following termination of his employment with Vishay Precision Group. “Cause,”
“good reason” and “change of control” will be as defined in Mr. Shoshani’s
employment agreement.
Marc Zandman
Mr. Zandman is
expected to be the non-executive Chairman of the Board of Directors of Vishay
Precision Group. Mr. Zandman will receive an annual $75,000 retainer for his
service on the Vishay Precision Group Board of Directors. Upon successful
completion of the spin-off, Mr. Zandman will also receive a founder’s equity
grant having a total value of $75,000. The grant will take the form of Vishay
Precision Group restricted stock units (RSUs), which will vest pro rata over
three years. These equity grants will be made pursuant to the Vishay Precision
Group 2010 Stock Incentive Program.
Other Executive Officers
The Strategic Affairs
and Compensation Committees also recommended to the Registrant’s Board of
Directors the terms of employment arrangements with other persons expected to
assume executive officer roles of Vishay Precision Group upon the completion of
the Vishay Precision Group spin-off, as reflected in term sheets. On March 18,
2010, the Registrant’s Board of Directors approved these term sheets. These
employees are not presently executive officers of the Registrant. The terms of
these arrangements will be disclosed in the Vishay Precision Group Form 10
registration statement required to be filed in connection with the spin-off.
Director Compensation
On March 18, 2010,
the Board of Directors determined to award to each of the non-management
directors an annual grant of 10,000 restricted stock units (“RSUs”). The RSUs
will vest three years from the date of grant, with pro rata vesting upon earlier
cessation of service. These grants will be made pursuant to the Vishay
Intertechnology 2007 Stock Incentive Program.
Signature
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: March 24, 2010
|
|
VISHAY INTERTECHNOLOGY,
INC. |
|
|
|
|
|
|
By: /s/ Lior E.
Yahalomi |
|
|
|
|
|
|
Name:
Dr. Lior E.
Yahalomi |
|
|
Title: |
Executive Vice President and |
|
|
|
Chief Financial Officer |