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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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): June 22, 2011
LIBBEY INC.
(Exact name of registrant as specified in its charter)
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Delaware
(State of incorporation)
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1-12084
(Commission File Number)
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34-1559357
(IRS Employer identification No.) |
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300 Madison Avenue |
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Toledo, Ohio
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43604 |
(Address of principal executive offices)
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(Zip Code) |
Registrants telephone number, including area code: (419) 325-2100
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligations of the registrant under any of the following provisions (see General
Instructions A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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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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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangement of Certain Officers.
On June 22, 2011, the Board of Directors of Libbey Inc. (we or the Company) appointed
Stephanie A. Streeter to become the Companys new Chief Executive Officer. In connection with Ms.
Streeters appointment, we entered into an Employment Agreement with Ms. Streeter, which will
become effective on July 1, 2011, at which time Ms. Streeter will serve as CEO-Elect until the
retirement of John Meier on July 31, 2011, as previously announced. Ms. Streeter will commence her
role as Chief Executive Officer on August 1, 2011.
Prior to joining the Company, Ms. Streeter, 53, served as interim Chief Executive Officer of
the United States Olympic Committee from March 2009 to March 2010. Before joining the United States
Olympic Committee, Ms. Streeter was employed by New York Stock Exchange-listed Banta Corporation, a
provider of printing and supply chain services, from 2001 to 2007, when Banta was acquired by R.R.
Donnelly & Sons Company. Ms. Streeter was appointed as President and Chief Executive Officer of
Banta in October 2002 and Chairman in April 2004; she served as President and Chief Operating
Officer of Banta from January 2001 to October 2002. Ms. Streeter currently serves as a director of
Kohls, a department store retailer, and The Goodyear Tire & Rubber Company, a manufacturer and
distributor of tires and related products and services. Ms. Streeter is not a party to any
transactions that would be required to be disclosed in accordance with Item 404 of Regulation S-K.
Pursuant to the Employment Agreement, we will pay Ms. Streeter an annual base salary of
$700,000. Ms. Streeter will be eligible under our Senior Management Incentive Plan (which we refer
to as our SMIP) for an annual cash incentive award in a target amount equal to 90% of her annual
base salary. Ms. Streeter is eligible to earn up to 200% of the target award based on actual
performance. For 2011, Ms. Streeter is entitled to an award under the SMIP that is prorated for to
reflect her July 1 start date but in no event is less than $315,000.
Ms. Streeter also will be eligible for long-term incentive awards under the Companys
long-term incentive plan. Ms. Streeter will have a target award equal to 180% of her annual base
salary. Currently, the target award has three components: (a) a performance-based cash award (40%);
(b) restricted stock units (RSUs) (30%); and (c) non-qualified stock options (NQSOs) (30%). Ms.
Streeter will be eligible to participate in the cash component portion of the program for the
2010-12 performance cycle (which we refer to as our 2010 LTIP) and the 2011-13 performance cycle
(which we refer to as our 2011 LTIP) on a pro rata basis. Under our 2010 LTIP, cash awards are
payable if and to the extent we achieve, over a 3-year performance cycle beginning January 1, 2010
and ending December 31, 2012, cumulative EBITDA (as may be adjusted) equal to the sum of EBITDA
budgeted for each of the 3 years during the performance cycle. Under our 2011 LTIP, cash awards are
payable if and to the extent we achieve, over a 3-year performance cycle beginning January 1, 2011
and ending December 31, 2013, cumulative EBITDA (as may be adjusted) equal to the sum of EBITDA
budgeted for each of the 3 years during the performance cycle. A more detailed description of our
long-term incentive program is contained in our proxy statement dated March 31, 2011.
In addition to participation in the performance-based cash component under our 2010 LTIP and
our 2011 LTIP, the Compensation Committee of our Board of Directors has granted to Ms. Streeter,
effective as of July 29, 2011, the following awards:
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Non-qualified stock options that (i) have a grant date fair
value, based on a Black Scholes valuation, equal to $350,000; (ii) vest
in four equal annual installments of 25% beginning June 30, 2012; and
(iii) have an exercise price equal to the closing price of our common
stock on the New York Stock Exchange on the grant date; and |
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Restricted stock units that have a grant date fair value equal to
$350,000 based on the average closing price of our common stock over a
period of 60 consecutive trading days ending on the grant date. |
Ms. Streeter is entitled to participate in other benefit programs generally
available to other executive officers or salaried employees, including, but not
limited to, the Libbey Inc. Retirement Savings Plan, the Libbey Inc. Executive
Deferred Compensation Plan, financial planning and tax services capped annually
at $20,000 and $15,000, respectively, and relocation services, including a
stipend of $5,000 a month for temporary housing and commuting expenses until
the earlier of her permanent relocation or one year. We also will provide Ms.
Streeter with loss-on-sale protection in connection with the sale of her
existing home in Wisconsin.
The term of the Employment Agreement will be three years. The term of the Employment
Agreement will be extended automatically for successive one-year periods unless either party gives
notice of non-renewal by March 1 of the then-current term. If the Company gives Ms. Streeter notice
of non-renewal but advises Ms. Streeter that it would like her to continue her employment, the
Company and Ms. Streeter will have until April 1 to negotiate in good faith terms of continued
employment. If the Company and Ms. Streeter have not negotiated terms of continued employment by
such date, Ms. Streeter may notify the Company that she is willing to extend the term of the
Employment Agreement for one year. If the Company does not notify Ms. Streeter by June 30 that it
is willing to extend the Employment Agreement for one year, the Company will be deemed to have
terminated Ms. Streeter without Cause (as defined in the Employment Agreement and described below).
The Employment Agreement provides that in the event of death or disability, in addition to any
accrued compensation payable at the date of termination, Ms. Streeter will receive an annual
incentive pro rated at target through the date of termination, long-term incentive compensation pro
rated at target through the date of termination and pro rata vesting of stock options and
restricted stock units.
The Employment Agreement provides that upon a termination by the Company without Cause (as
defined in the Employment Agreement and set forth below) or by Ms. Streeter for Good Reason (as
defined in the Employment Agreement and set forth below), in addition to any accrued compensation
payable at the date of termination, Ms. Streeter will receive severance in an amount equal to two
times base salary plus two times the greater of target bonus or average of the prior two years
bonus, payable over a 24 month period; pro rata annual incentive for the year of termination based
on actual performance; pro rata long term incentive compensation based on actual performance;
accelerated vesting on any time-vested equity awards that would have otherwise vested after the
date of termination but on or prior to the next June 30 following the date of termination;
continuation of medical and life insurance benefits for 18 months after termination or until Ms.
Streeter receives medical and/or life insurance coverage through a future employer, if earlier than
18 months; and executive level outplacement services paid by the Company in an amount not to exceed
$75,000.
As defined in the Employment Agreement, Cause means (i) Ms. Streeters willful and continued
failure (other than as a result of incapacity due to physical or mental illness or after Ms.
Streeter issues a notice of termination for Good Reason) to substantially perform her duties, after
the Board of Directors delivers to Ms. Streeter a written demand for substantial performance that
specifically identifies the manner in which the Board believes that she has not substantially
performed her duties, (ii) Ms. Streeters willful and continued failure (other than as a result of
incapacity due to physical or mental illness or after issuance of a notice of termination for Good
Reason) to substantially follow and comply with the specific and lawful directives of the Board of
Directors, as reasonably determined by the Board, after the Board delivers to Ms. Streeter a
written demand that specifically identifies the manner in which the Board believes that she has not
substantially followed or complied with the directives of the Board, (iii) Ms. Streeters
commission of an act of fraud or dishonesty that results in a material adverse effect to the
Company or her commission of an act in material violation of the Companys code of ethics as in
effect from time to time, or (iv) Ms. Streeters willful engagement in illegal conduct or gross
misconduct that is materially and demonstrably injurious to the Company.
As defined in the Employment Agreement, Good Reason means (i) a material diminution in Ms.
Streeters authority, duties, or responsibilities, including without limitation her ceasing to be
the Chief Executive Officer of the Company reporting directly to the Board of Directors; (ii) a reduction of
Ms. Streeters base salary; (iii) a reduction of Ms. Streeters incentive compensation opportunity
by a percentage greater than that applicable to all other executive officers; (iv) a reduction or
elimination of an executive benefit or an employee benefit and the reduction is not applicable to
all other officers in the same or similar manner; (v) Ms. Streeter at any time fails to be elected
as a member of the Board of Directors; or (vi) The Company materially breaches the Employment
Agreement and does not remedy such breach prior to the expiration of 30 days after receipt of
written notice of the breach given by Ms. Streeter to the Company.
Ms. Streeter will not be party to a separate Change in Control Agreement. The Employment
Agreement provides that upon a termination by the Company without Cause or a termination by Ms.
Streeter for Good Reason within two years following a Change in Control (as defined in the
Employment Agreement and set forth below) or if a Change in Control occurs within six months
following a termination by the Company without Cause or a termination by Ms. Streeter for Good
Reason, Ms. Streeter will receive all of the benefits she would have received upon a termination by
the Company without Cause or a termination by Ms. Streeter for Good Reason, except that the
severance benefit will be two and one-half times salary plus bonus (rather than two times as set
forth above) and will be paid in a lump sum rather than installments (subject to compliance with
Section 409A of the Internal Revenue Code).
The Employment Agreement does not provide for any separation pay upon voluntary resignation or
retirement.
All benefits payable under the Agreement after termination will be conditioned on Ms. Streeter
executing a release of claims against the Company.
The Agreement provides for perpetual confidentiality and non-disparagement provisions post-
termination and provides for covenants against competition with the Company and solicitation of the
Companys employees and customers for 24 months following termination.
Item 7.01. Regulation FD Disclosure.
On June 27, 2011, the Company issued a press release announcing the retention of Ms. Streeter
as Chief Executive Officer and the appointment of William Foley as Chairman of the Board, a copy of
which is filed as Exhibit 99.1 hereto and incorporated by reference herein.
This information is furnished pursuant to Item 7.01 of Form 8-K and shall not be deemed to be
filed for the purposes of Section 18 of the Securities Exchange Act of 1934 (the Exchange Act)
or otherwise subject to the liabilities of that Section, unless Libbey Inc. specifically
incorporates it by reference in a document filed under the Securities Act of 1933 or the Exchange
Act. By filing this Current Report on Form 8-K and furnishing this information, Libbey Inc. makes
no admission as to the materiality of any information in this report that is required to be
disclosed solely by reason of Regulation FD.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
99.1 |
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Press Release dated June 27, 2011 |
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 here unto duly authorized.
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LIBBEY INC.
Registrant
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Date: June 27, 2011 |
By: |
/s/ Susan A. Kovach
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Susan A. Kovach |
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Vice President, General Counsel &
Secretary |
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Exhibit Index
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Exhibit |
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Description |
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99.1
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Press Release dated June 27, 2011 |