WEIS MARKETS INC — Board/Management Information 2014

Jul 18, 2014

8-K 1 wmk8k07182014.htm WEIS MARKETS, INC. FORM 8-K EMPLOYMENT AGREEMENT - JONATHAN H. WEIS html PUBLIC "-//W3C//DTD HTML 3.2//EN" WMK Form 8-K Employment Agreement - Jonathan H. Weis

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): July 14, 2014

WEIS MARKETS, INC . (Exact Name of Registrant as Specified in Charter)

Pennsylvania (State or Other Jurisdiction of Incorporation)

| 1-5039 (Commission File Number) | 24-0755415 (IRS Employer Identification
No.) |
| --- | --- |
| 1000 South Second Street Sunbury, PA (Address of Principal
Executive Offices) | 17801 (Zip Code) |

Registrant's telephone number, including area code: (570) 286-4571

N/A (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))

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

| Jonathan H. Weis
Amended and Restated Employment
Agreement |
| --- |
| On July 14, 2014, with
retroactive effect to January 1, 2014, Weis
Markets, Inc. (the "Company") amended and
restated the employment agreement (the
"Employment Agreement") dated November 3, 2011
with Jonathan H. Weis, who served as Vice
Chairman and Secretary of the Company since 2004
and currently serves as Vice Chairman, President
and Chief Executive Officer. The amended and
restated Employment Agreement commenced on
January 1, 2014 and continues through December
31, 2016 (the "Term"). The Employment Agreement
provides Mr. Weis with the following compensation
and benefits: |
| Annual base salary of no
less than $860,000, subject to periodic review
and adjustment by the Board of Directors of the
Company (the "Board") or the Compensation
Committee of the Board; |
| Participation in any
annual or long-term bonus or incentive plans
maintained by the Company for its senior
executives; |
| A supplemental long-term
cash incentive under the Company's Chief
Executive Officer Incentive Award Plan (the
"Plan"), effective July 1, 2011 and amended and
restated effective as of January 1, 2014 (as
further described below); |
| Participation in any stock
option, stock ownership, stock incentive or other
equity-based compensation plans maintained by the
Company for its senior executives; |
| Participation in all
compensation or employee benefit plans or
programs, and all benefits or perquisites, for
which any member of the Company's senior
management is eligible under any existing or
future Company plan or program; and |
| A term life insurance
policy with a death benefit of
$1,000,000. |
| The Employment Agreement
further provides that if the Board determines
that Mr. Weis has been incompetent or negligent
in the performance of his duties or engaged in
fraud or willful misconduct in a manner that
caused or contributed to the need for a material
restatement of the Company's financial results,
and if the performance-based compensation paid
under the Employment Agreement would have been
lower if based on such restated results, then the
Board and the Company will seek recoupment from
Mr. Weis of any portion of such performance-based
compensation deemed appropriate. |
| In the event that Mr.
Weis' employment terminates due to a "Without
Cause Termination" or is terminated by Mr. Weis
for "Good Reason," then, pursuant to the
Employment Agreement, Mr. Weis will be entitled
to: |
| Earned but unpaid base
salary as of the date of termination and any
earned but unpaid bonuses for prior years (other
than any bonuses payable under the Plan)
("Accrued Obligations"); |
| Continued base salary, as
in effect at termination, payable until the end
of the Term; and |
| Payment, for the year of
termination and for each subsequent calendar year
or portion thereof during the remainder of the
Term, of an amount (prorated in the case of any
partial year) equal to the highest annual
incentive bonus (not including any bonus paid
under the Plan) received for any year in the two
years preceding the date of
termination. |
| For these purposes
"Without Cause Termination" means a termination
of employment by the Company other than due to
"Disability" or the expiration of the Term and
other than a "Termination for Cause."
"Disability" for purposes
of this Agreement shall have the meaning set
forth in Internal Revenue Code (the "Code")
Section 409(a)(2)(C) and the regulations
thereunder . A "Termination for
Cause" means a termination by the Company by the
vote of the majority of the Board because Mr.
Weis (a) has been convicted of, or has entered a
plea of nolo contendere to, a criminal offense
involving moral turpitude, or (b) has willfully
continued to fail to substantially perform his
duties with the Company after a written demand
for substantial performance is delivered by the
Board, or (c) has committed an improper action
resulting in personal enrichment at the expense
of the Company, or (d) has engaged in illegal or
gross misconduct that is materially and
demonstrably injurious to the Company, or (e) has
violated his representations or duties under the
Employment Agreement. |
| In the event of his
Disability, the Company may remove Mr. Weis from
employment, in which case, pursuant to the
Employment Agreement, Mr. Weis will be entitled
to: |
| Accrued
Obligations; |
| Continued base salary,
offset by any amounts otherwise payable under the
Company's disability program, at the rate of 50%
of base salary as of the date of disability,
payable until the end of the Term;
and |
| A bonus for the year of
disability equal to the amount determined by the
Company in good faith to be the amount of bonus
that Mr. Weis would have received if he had been
employed throughout the bonus year, which will be
prorated on a daily basis as of the date of
disability. |
| In the event of his death,
pursuant to the Employment Agreement, Mr. Weis
will be entitled to: |
| Accrued Obligations as of
the date of death payable in full;
and |
| From the date of death
until the end of the Term, base salary payments,
at the rate of 50% of base salary as of the date
of death, to Mr. Weis' surviving spouse and,
following the death of his spouse, to his
estate. |
| In the event that Mr.
Weis' employment terminates due to a Termination
for Cause or Mr. Weis terminates employment other
than for "Good Reason," Disability, retirement
under the Company's established policies, or
death, then Accrued Obligations and vested
benefits as of the date of termination will be
payable to Mr. Weis in full. No other payments
will be made to Mr. Weis, except for benefits
that have already become vested under the terms
of the Company's employee benefit programs. For
these purposes, a termination by Mr. Weis for
"Good Reason" means a termination by notice given
at any time due to (a) any reduction without his
consent in Mr. Weis' salary below $860,000 per
annum or (b) failure of the Company or its
successor to fulfill its obligations under the
Employment Agreement in any material
respect. |
| The Employment Agreement
also provides that Mr. Weis may not disclose or
use any confidential information of the Company
during or after the Term of the Employment
Agreement. During his employment with the Company
and for a period of four years following his
termination of employment for any reason, Mr.
Weis is also precluded from engaging or assisting
in any business which is in competition with the
Company and from soliciting any Company employee,
consultant, vendor or supplier. |
| The preceding description
of the Employment Agreement is a summary of its
material terms, does not purport to be complete,
and is qualified in its entirety by reference to
the Employment Agreement, a copy of which is
being filed as Exhibit 10.1 to this Current
Report on Form 8-K and is incorporated herein by
reference. |
| Chief Executive Officer
Incentive Award Plan |
| The Compensation Committee
of the Board adopted the Chief Executive Officer
Incentive Award Plan (the "Plan"), effective July
1, 2011, amended and restated effective as of
January 1, 2014, which is designed to provide a
strong financial incentive for chief executive
officer ("CEO") performance by making a
significant percentage of the CEO's total cash
compensation dependent upon yearly corporate
performance, and to encourage CEO
retention. |
| Prior to the amendment
and restatement of the Plan effective January 1,
2014, the Plan for Mr. Weis was the "Vice Chairman
Incentive Award Plan." Any awards earned by Mr.
Weis through December 31, 2013 under the Plan are
being paid in 2014. |
| Pursuant to the Plan, the
CEO is entitled to receive an incentive award for
each fiscal year consisting of the
following: |
| A retention award equal to
the participant's base salary, in effect as of
the end of the fiscal year, multiplied by 1.375; and |
| A performance award equal
to the base salary in effect as of the end of
the fiscal year, contingent
upon the achievement of specified performance
requirements (each, a "Performance Target," and
together, the "Performance Targets"), as
follows: |
| One-half of the Performance Award is based on the ratio of the Company's net sales in comparison to a net sales target for a Plan year. The net sales ratio has a "Threshold" which must be met in order to qualify for such Performance Award, a "Target" which is the net sales target, and a "Maximum" net sales ratio upon which a Performance Award may be made. For 2014 the Threshold is 97% of the net sales target and the Maximum is 103% of the net sales target, with 0% performance achieved at Threshold, 100% performance achieved at Target and 150% performance achieved at Maximum, and with interpolation used to determine the performance achieved between the Threshold, Target and Maximum levels. |
| One-half of the Performance Award is based on the ratio of the Company's Modified Return On Invested Capital (the "MROIC") in comparison to the MROIC target for a Plan year. The MROIC ratio has a "Threshold" which must be met in order to qualify for such Performance Award, a "Target" which is the MROIC target, and a "Maximum" MROIC ratio upon which a Performance Award may be made. For 2014 the Threshold is 98% of the MROIC target and the Maximum is 105% of the MROIC target, with 0% performance achievement at Threshold, 100% performance achieved at Target and 150% performance achieved at Maximum, and with interpolation used to determine the performance achieved between the Threshold, Target and Maximum levels. |
| The Committee retains
the right to adjust the Target and related
Threshold and Maximum levels at any time in their
sole discretion . Although the right to
receive awards under the Plan are measured and
determined on an annual basis, except in the case
of a Without Cause Termination (as defined above)
or death, no Plan award will be paid to the
participant until after December 31, 2016,
provided that the participant remains employed as
such from January 1, 2014 through December 31,
2016. Within 2 ½ months following the end
of the fiscal year, the Compensation Committee
will determine in accordance with the terms of
the Plan and certify in writing whether a
Performance Target was achieved. Subject to
exception in the event that a delay in payment is
required under Section 409A of the Code and any
deferral election made by the participant under
any deferral plan of the Company then in effect,
any incentive award to which a participant
becomes entitled will be paid in a lump sum cash
payment within 2 ½ months after December
31, 2016, subject to the determination and
certification by the Committee of each
performance award for each plan year. |
| Under the Plan, if the
participant's employment is subject to a Without
Cause Termination, the Company will pay the
participant as follows: |

| If the Without Cause
Termination occurs | |
| --- | --- |
| on or between the
following dates: | Amount to be
Paid |
| January 1, 2014 to
December 31, 2014 | $2,500,000 |
| January 1, 2015 to
December 31, 2015 | $3,000,000 |
| January 1, 2016 to
December 31, 2016 | $3,500,000 |

Subject to exception in the event that a delay in payment is required under Section 409A of the Code, any amounts payable due to a Without Cause Termination will be paid in a lump sum cash payment within 2 ½ months after the end of the calendar year in which such Without Cause Termination occurs.

Upon the death of the participant, the Company will pay $1,000,000 to the participant's surviving spouse, if any, or otherwise to the participant's estate. Such payment will be made within sixty (60) days of the date of death of the participant. In the case of any other termination of employment prior to December 31, 2016, including for disability, retirement, resignation or Termination for Cause, the participant will not be entitled to receive payment of any amounts under the Plan.

Incentive awards payable under the Plan are subject to the same recoupment provisions as apply for payments made pursuant to the Employment Agreement, as described above.

The preceding description of the Plan is a summary of its material terms, does not purport to be complete, and is qualified in its entirety by reference to the Plan, a copy of which is being filed as Exhibit 10.2 to this Current Report on Form 8-K and is incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

The following exhibits are filed herewith:

| Exhibit
No. | Description |
| --- | --- |
| 10.1 | Amended and Restated
Employment Agreement, effective January 1, 2014,
by and between Weis Markets, Inc. and Jonathan H.
Weis. |
| 10.2 | Weis Markets, Inc. Chief
Executive Officer Incentive Award Plan, effective
July 1, 2011, Amended and Restated effective as
of January 1, 2014. |

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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.

By: /s/Scott F.
Frost
Name: Scott F.
Frost
Title: Senior Vice
President, Chief Financial Officer
and
Treasurer
(Principal
Financial Officer)
Dated: July 18,
2014

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EXHIBIT INDEX

| Number | Description | Method of
Filing |
| --- | --- | --- |
| 10.1 | Amended and Restated
Employment Agreement, effective January 1, 2014,
by and between Weis Markets, Inc. and Jonathan H.
Weis. | Filed
herewith. |
| 10.2 | Weis Markets, Inc. Chief
Executive Officer Incentive Award Plan, effective
July 1, 2011, Amended and Restated effective as
of January 1, 2014. | Filed
herewith. |