Attached files
file | filename |
---|---|
EX-99.1 - KIP WADSWORTH_PRESS RELEASE - STERLING CONSTRUCTION CO INC | press.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): January 19, 2010
STERLING
CONSTRUCTION COMPANY, INC.
|
(Exact
name of registrant as specified in its charter)
Delaware
|
1-31993
|
25-1655321
|
||||
(State
or other jurisdiction of incorporation or organization)
|
(Commission
File Number)
|
(I.R.S.
Employer Identification No.)
|
||||
20810
Fernbush Lane
Houston,
Texas
|
77073
|
|||||
(Address
of principal executive offices)
|
(Zip
Code)
|
|||||
Registrant’s
telephone number, including area code: (281)
821-9091
|
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 142-2(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))
|
Item 5.02 Departure of Directors or
Certain Officers; Election of Directors; Appointment of Certain Officers;
Compensatory Arrangements of Certain Officers.
Effective
January 19, 2010, the Board of Directors of Sterling Construction Company, Inc.
("Sterling") increased
the size of the Board from nine directors to ten directors and elected Kip L.
Wadsworth to fill the vacancy thereby created to serve until the 2010 Annual
Meeting of Stockholders.
The Board
created the vacancy and elected Mr. Wadsworth to fill it pursuant to the
purchase agreement (the "Purchase Agreement") by which
Sterling acquired an 80% interest in Ralph L. Wadsworth Construction Company,
LLC, a heavy civil construction company ("RLW") on December 3,
2010. The Purchase Agreement provides that after the closing of the
purchase, Sterling's Chairman of the Board of Directors will propose to the
Board of Directors that Mr. Wadsworth, who is President of RLW and one of the
sellers of the 80% interest to Sterling, be elected a director. Mr.
Wadsworth remains a 5.65% owner of RLW.
Mr.
Wadsworth is 43 years of age and has agreed to serve as a
director. Like all employees of Sterling and its affiliates, Mr.
Wadsworth will not receive any extra compensation for serving on the
Board.
Pursuant
to the Purchase Agreement, Mr. Wadsworth entered into an employment agreement
with RLW that contains the following terms:
Agreement
Term:
|
December
3, 2009 through December 31, 2012
|
Title:
|
President
|
Annual
Salary:
|
$244,000
|
Annual
Bonus:
|
A
cash bonus of $195,200 in each year in which RLW achieves 75% of its
mutually agreed upon forecasted earnings before interest, taxes,
depreciation and amortization (Forecasted EBITDA) (as defined in the
Purchase Agreement); plus cash of $24,400 and a restricted stock bonus
valued at $24,400 in each year in which RLW achieves 100% of its
Forecasted EBITDA; plus 24.7% of a pool of funds equal to 8% of the amount
by which RLW's EBITDA in a given year exceeds RLW's Forecasted EBITDA for
such year by up to $5 million; plus 24.7% of a pool of funds equal to 5%
of the amount by which RLW's EBITDA in a given year exceeds RLW's
Forecasted EBITDA for such year by more than $5
million.
|
Benefits:
|
The
same as other employees of RLW, except that vacation time is in the
discretion of Mr. Wadsworth based on what he believes is appropriate in
light of the needs of RLW's business. He is also entitled to a
car allowance of $1,100 per month.
|
Termination:
|
Mr. Wadsworth
is entitled to the payments described below if his employment terminates
before the expiration of the agreement, depending on the reason for the
termination:
Death or
Disability: Accrued salary through the date of
termination; any earned but unpaid bonus; and a portion of the bonus that
he would have earned in the year of termination had his employment not
terminated, based on the number of days elapsed during the year at the
date of termination.
For
Cause: Accrued salary through the date of the
termination only. Cause is defined in the agreement and means
what is commonly referred to as cause in employment matters.
Without Cause or for an
Uncured Breach of the Agreement by RLW: Accrued salary through the
date of termination or through December 3, 2012, whichever period is
longer; any earned but unpaid bonus; any bonus that would have been earned
in the year of termination had his employment not terminated; and
continued coverage under RLW's medical and dental plans for twelve
months.
Voluntary
Resignation: Accrued salary through the date of
termination.
|
Non-Competition
and Non-Solicitation
|
The
agreement prohibits Mr. Wadsworth from competing with RLW or Sterling, or
soliciting their employees for employment during his employment by RLW and
for one year after his employment terminates, but at least through
December 3, 2013.
|
Indemnification
|
RLW
is obligated to indemnify Mr. Wadsworth against claims made against him as
a director, officer and/or employee of RLW and of any affiliate of RLW to
the fullest extent permitted by RLW’s charter and operating agreement; by
Sterling's charter and bylaws; and by the laws of the states of Utah and
Delaware. Sterling is obligated to maintain insurance coverage
for these indemnification obligations in the same amount as it maintains
for its own directors, but in any event at least $5 million of
coverage.
|
The
foregoing is only a summary of the material terms of the agreement.
Item
8.01 Other Events
On
January 21, 2010, Sterling issued a press release announcing the election of Kip
L. Wadsworth as a director of Sterling. A copy of the press release
is filed as Exhibit 99.1 to this Form 8-K.
In
accordance with General Instruction B.2 of Form 8-K, the press release shall not
be deemed "filed" for the purposes of Section 18 of the Exchange Act of 1934, or
otherwise subject to the liabilities of that section, nor shall such information
and exhibit be deemed incorporated by reference into any filing under the
Securities Act of 1933 or the Securities Exchange Act of 1934 except as shall be
expressly set forth by specific reference in such a filing.
Item
9.01 Financial
Statements and Exhibits.
(c) Exhibits
Exhibit
Number Description
99.1 Press
release, dated January 21, 2010 (furnished herewith.)
* * * * *
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
20,
2010 Sterling Construction Company,
Inc.
/s/ Roger M.
Barzun
Roger M. Barzun
Senior Vice President
Exhibit
Index
Exhibit
Number Description
99.1 Press
release, dated January 21, 2010 (furnished herewith.)