Attached files
| file | filename |
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| EX-3.1 - NU HORIZONS ELECTRONICS CORP | v183158_ex3-1.htm |
| EX-99.1 - NU HORIZONS ELECTRONICS CORP | v183158_ex99-1.htm |
| EX-10.4 - NU HORIZONS ELECTRONICS CORP | v183158_ex10-4.htm |
| EX-10.3 - NU HORIZONS ELECTRONICS CORP | v183158_ex10-3.htm |
| EX-10.2 - NU HORIZONS ELECTRONICS CORP | v183158_ex10-2.htm |
| EX-10.1 - NU HORIZONS ELECTRONICS CORP | v183158_ex10-1.htm |
| EX-10.7 - NU HORIZONS ELECTRONICS CORP | v183158_ex10-7.htm |
| EX-10.6 - NU HORIZONS ELECTRONICS CORP | v183158_ex10-6.htm |
| EX-10.5 - NU HORIZONS ELECTRONICS CORP | v183158_ex10-5.htm |
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): April 28, 2010
Nu Horizons Electronics
Corp.
(Exact
name of registrant as specified in its charter)
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DELAWARE
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1-8798
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11-2621097
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(State
or other jurisdiction
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(Commission
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(I.R.S.
Employer
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of
incorporation)
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File
Number)
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Identification
No.)
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70 Maxess Road, Melville, New
York
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11747
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(Address
of principal executive offices)
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(Zip
Code)
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(631)
396-5000
Registrant's
telephone number, including area code
Not
Applicable
(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):
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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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o
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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-14(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
3.03 Material Modification to Rights of Security Holders.
(a) On
April 28, 2010, the Board of Directors of Nu Horizons Electronics Corp.
(the “Company”) amended and restated the Company’s By-Laws effective as of
May 3, 2010 (the “By-Laws”). For a complete description of the
amendments to the By-Laws, see item 5.03, below.
Item
5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
(b) On
April 28, 2010, the Company announced that effective May 3, 2010,
Arthur Nadata will cease to serve as interim Chief Executive Officer and
Executive Chairman in connection with the Company’s employment of Martin Kent as
President and Chief Executive Officer. In connection with the Company’s
employment of Martin Kent as Chief Executive Officer and as part of its
succession plan, Mr. Nadata will become the Company’s non-executive
Chairman of the Board. For a description of the terms of the amendments to
Mr. Nadata’s current employment agreement with the Company dated
September 13, 1996, as amended to date (the “Nadata Agreement”) and a
complete description of the terms of Mr. Kent’s employment as President and
Chief Executive Officer, see item 5.02(e) and 5.02(c),
respectively.
On
April 28, 2010, the Company announced that effective May 3, 2010,
Richard Schuster will cease to serve as interim President in connection with the
Company’s employment of Martin Kent as President and Chief Executive
Officer. Mr. Schuster will continue to serve as the Company’s
Senior Executive Vice President and Chief Operating Officer and as a member of
the Board. For a description of the terms of the amendment to
Mr. Schuster’s current employment agreement with the Company dated
September 13, 1996, as amended to date (the “Schuster Agreement”), see
item 5.02(e), below.
(c) On
April 28, 2010, the Company entered into an agreement with Mr. Martin
Kent (the “Kent Agreement”), who is 59 years old, to employ him as the
President and Chief Executive Officer of the Company, effective May 3, 2010
(the “Effective Date”). Prior to joining the Company, Mr. Kent
was affiliated with Abacus Group, Plc, an electronic component distribution
company traded on the London Stock Exchange from November 1993 until January
2009, serving as its chief executive officer and a director from November 2000
to April 2009. Prior thereto, from 1989, Mr. Kent served as managing
director and/or marketing director of various divisions of Abacus.
Pursuant
to the terms of the Kent Agreement, which was approved by the Company’s
Compensation Committee and the Board of Directors, it was agreed
that
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Mr. Kent
will be employed for a four-year term and receive an annual salary of
$425,000.
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Mr. Kent
will be eligible to receive a total annual bonus consisting of a
quantitative bonus and a qualitative bonus in an amount up to an aggregate
of 100% of his base salary, with a target bonus in an amount up to an
aggregate 50% of his base
salary.
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Any
quantitative bonus will be in amount up to 70% of Mr. Kent’s Base
Salary (i.e. $297,500) (the “Maximum Quantitative Bonus”). The
amount of the quantitative bonus will be calculated based on reaching a
minimum achievement goal (the “Minimum”), at which level he shall begin to
have the right to receive a portion of such quantitative bonus, a target
achievement goal (the “Target”), where he shall have the right to receive
one-half of the Maximum Quantitative Bonus, and an overachievement goal
(the “Maximum”), where he shall have the right to receive the maximum
incentive amount of the Maximum Quantitative Bonus. For the Company’s
fiscal year ending February 28, 2011 (“Fiscal 2011”), the
quantitative bonus will be calculated based on the Company’s achievement
of certain levels of pre-tax income in an amount to be
determined. The quantitative bonus payable to Mr. Kent
shall be calculated, based on actual results reported by the Company in
respect of Fiscal 2011, prorated on a straight-line basis between the
Minimum and the Target, or the Target and the Maximum, as
applicable.
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Any
qualitative bonus shall be in an amount up to 30% of Mr. Kent’s Base
Salary (i.e., $127,500), with a target bonus in an amount equal to 15% of
Mr. Kent’s Base Salary (i.e., $63,750). The qualitative bonus amount
will be such amount as the Board and the Compensation Committee shall
determine in their sole and absolute discretion. All or any
portion of the qualitative bonus may be paid in the form of stock in the
sole and absolute discretion of the Board and Compensation
Committee.
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Mr.
Kent will be appointed to the Board of Directors as of the Effective
Date.
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On
the business day following the execution of the Kent Agreement,
Mr. Kent will also be granted 360,000 inducement stock options (the
“Kent Options”). The Kent Options will have a term of 10 years from
the date of grant, an exercise price equal to the fair market value on the
date of grant, and become exercisable in four equal annual installments
commencing on the first anniversary of the date of grant; however,
Mr. Kent cannot exercise any such vested options unless the closing
stock price of the common stock shall be no less than $5.00 per share for
at least 10 consecutive trading days prior to the date of exercise. All
360,000 Kent Options will automatically become fully exercisable in the
event of a sale or change of control of the Company. In accordance with
the terms of the Kent Agreement, the Kent Options were granted on April
29, 2010 with an exercise price of $3.69 per
share.
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Mr. Kent
will also be entitled to certain other benefits, as
follows:
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reimbursement
for his living expenses prior to his establishment of a permanent
residence in Long Island, New York during the first year of the
employment term in an amount not to exceed
$30,000;
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reimbursement
for certain relocation expenses in connection with his relocation from the
United Kingdom to Long Island, New York in an amount not to exceed an
aggregate $55,000;
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twelve (12)
round-trip first-class airline tickets from London to New York during
the first year of the employment
term;
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a
car allowance of $1,000 per month;
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participation
in benefit plans available to other executives of the Company;
and
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four
weeks of vacation each year.
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In
the event that the Company terminates Mr. Kent’s employment on or
before May 3, 2011, the Company shall reimburse Mr. Kent for
certain relocation expenses in connection with his physical relocation to
the United Kingdom in an amount not to exceed an aggregate
$100,000. In the event that the Company terminates his
employment at any time during the term of employment other than “for
cause” (as defined in the Kent Agreement), Mr. Kent is entitled to
receive his base salary and benefits through the date of
termination.
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The
Company does not anticipate that any compensation received by Mr. Kent in
excess of $1,000,000 for any fiscal year of the Company will be deductible by
the Company.
The Board
of Directors believes that Mr. Kent is qualified to serve as a director of
the Company due to his prior industry experience as chief executive officer of
Abacus, an approximately $500 million electronic component distribution
company with overseas operations in Europe and Asia.
Mr. Kent
and the Company also executed the Company’s standard Form of Indemnity
Agreement, effective as of May 3, 2010, previously described and disclosed
as Exhibit 10.1 to the Form 10-Q for the fiscal quarter ended May 31,
2008, as filed by the Company on July 9, 2008.
(d)
Pursuant to the terms of the Kent Agreement, which agreement is more completely
described in paragraph (c) of this item 5.02, Mr. Kent was
appointed to the Board of Directors effective as of the Effective Date to serve
in Class I.
(e) In
connection with the Company’s succession plan, on April 28, 2010,
Mr. Nadata and the Company entered into both a transition agreement (the
“Transition Agreement”) and an amendment to the Nadata Agreement (the “Nadata
Amendment”), each of which amends the Nadata Agreement. Pursuant to the
Transition Agreement, it was agreed that
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effective
May 3, 2010, Mr. Nadata will cease to serve as Executive
Chairman and become the non-executive Chairman of the Board, remaining as
an employee of the Company. Mr. Nadata will retire as an
employee on July 28, 2010. Until July 28, 2010, Mr. Nadata
will continue to receive his current base salary and continue to
participate in the Company’s employee benefit
programs.
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from
July 29, 2010 through February 28, 2011, Mr. Nadata will
continue to serve as the Company’s non-executive Chairman of the Board and
serve as a director of the Company.
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For
the period from July 29, 2010 through November 30, 2010, he will
receive $137,500, which aggregate amount will be paid as
follows: in four equal monthly installments in August,
September, October and November
2010.
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For
the period from December 1, 2010 through February 28, 2011, he
will receive $37,500, which aggregate amount will be paid in three equal
monthly installments in December 2010, January 2011 and February
2011.
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Commencing
July 29, 2010, Mr. Nadata may maintain his employee medical
benefits under the Consolidated Omnibus Budget Reconciliation Act of 1985,
as amended (“COBRA”), provided that he timely elects COBRA coverage and
the Company will reimburse him on an after-tax basis, for the premiums
paid by him during the COBRA continuation period until such time as he
becomes eligible for Medicare
benefits.
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After
February 28, 2011, Mr. Nadata will be eligible to receive a
special cash bonus of up to $50,000, if the Compensation Committee, in its
sole discretion, determines that he has faithfully supported the
successful integration of Mr. Kent as Chief Executive
Officer.
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For
the period from March 1, 2011 until the Company’s 2011 Annual Meeting
of Stockholders, Mr. Nadata will receive $10,000 per month (prorated
for any partial months) for his service as non-executive Chairman of the
Board.
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For
the period from the Company’s 2011 Annual Meeting of Stockholders until
its 2012 Annual Meeting of Stockholders, if Mr. Nadata is re-elected
as a director at the 2011 Annual Meeting of Stockholders and he continues
his service as non-executive Chairman of the Board, he will receive
$10,000 per month (prorated for any partial months) for his service as
non-executive Chairman of the
Board.
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On
the business day following the execution of the Transition Agreement,
Mr. Nadata will receive an award of 200,000 stock options under the
Company’s 2000 Key Employee Stock Option Plan and 2002 Key Employee Stock
Incentive Plan (the “Nadata Options”). The Nadata Options will have a term
of 10 years from the date of grant, an exercise price equal to the fair
market value on the grant date and become exercisable as follows: 5,555
shares per month for the 23-month period commencing on the grant date;
5,569 shares on April 29, 2012; and 66,666 shares on July 29,
2010. Mr. Nadata’s right to exercise the Nadata Options is
subject to a claw-back under certain circumstances. In accordance with the
terms of the Transition Agreement, the Nadata Options were granted
from the 2002 Key Employee Stock Incentive Plan on April 29,
2010 with an exercise price of $3.69 per
share.
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Pursuant
to the Nadata Amendment, the form of Consulting Agreement attached as an exhibit
to the Nadata Agreement and to be entered into upon his termination other than
for Cause was revised. As amended, the Consulting Agreement provides that in
exchange for his service as a consultant to the Company, for a five-year period
beginning upon such termination, he and his spouse shall be entitled to medical
benefits under COBRA in the event that he and his spouse are unable to
participate in the Company’s medical and dental plans, plus receive
reimbursement for any income taxes payable by him in respect of such benefit or
if he is able to participate in the Company’s medical and dental plans, he and
his spouse shall be entitled to benefits under such plans plus reimbursement for
the income taxes payable in respect of a portion of such benefits.
In
connection with the Company’s succession plan, Mr. Schuster and the Company
entered into an amendment to the Schuster Agreement on April 28, 2010 (the
“Schuster Amendment”) pursuant to which it was agreed that effective May 3,
2010, Mr. Schuster’s existing bonus arrangement will be amended to more
closely align his compensation arrangement with that of Mr. Kent, as
described in item 5.02(c).
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Pursuant
to the Schuster Amendment, Mr. Schuster will be eligible to receive a
total annual target bonus consisting of a quantitative bonus and a
qualitative bonus in an amount equal to an aggregate 100% of his base
salary, with a target bonus in an amount equal to an aggregate 50% of his
base salary.
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Any
quantitative bonus, if any, will be in amount up to 70% of
Mr. Schuster’s Base Salary (the “Maximum Quantitative
Bonus”). The amount of the quantitative bonus will be
calculated based on reaching a minimum achievement goal (the “Minimum”),
at which level Mr. Schuster shall begin to have the right to receive a
portion of such quantitative bonus, a target achievement goal (the
“Target”), where he shall have the right to receive one-half of the
Maximum Quantitative Bonus, and an overachievement goal (the “Maximum”),
where he shall have the right to receive the maximum incentive amount of
the Maximum Quantitative Bonus. For the Company’s fiscal year
ending February 28, 2011 (“Fiscal 2011”), the Quantitative Bonus will
be calculated based on the Company’s achievement of certain levels of
pre-tax income, in an amount to be determined. The quantitative
bonus will be calculated, based on actual results reported by the Company
in respect of Fiscal 2011, prorated on a straight-line basis between the
Minimum and the Target, or the Target and the Maximum, as
applicable.
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Any
qualitative bonus shall be in an amount up to 30% of Mr. Schuster’s
base salary (the “Maximum Qualitative Bonus”), with a target bonus in an
amount equal to one-half of the Maximum Qualitative Bonus. The qualitative
bonus amount will be such amount as the Board and the Compensation
Committee shall determine in their sole and absolute
discretion. Notwithstanding the qualitative nature of the
qualitative bonus, for Fiscal 2011, Mr. Schuster’s qualitative bonus
will be calculated in the same manner as the quantitative bonus; except
that the qualitative bonus will based on the achievement by the Company’s
subsidiary NIC Components Inc. and its subsidiaries (collectively, “NIC”)
of specified levels of NIC’s pre-tax income for Fiscal 2011. The
qualitative bonus payable to Mr. Schuster in Fiscal 2011 shall be
calculated, based on actual results reported by NIC in respect of Fiscal
2011, prorated on a straight-line basis between the NIC Minimum and the
NIC Target, or the NIC Target and the NIC Maximum, as
applicable.
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On
the business day following the execution of the Schuster Amendment,
Mr. Schuster will receive an award of an aggregate 200,000 stock
options under the Company’s 2000 Key Employee Stock Option Plan and 2002
Key Employee Stock Incentive Plan. The 200,000 options will have a term of
10 years from the grant date, an exercise price equal to the fair market
value on the date of grant and become exercisable in three equal annual
installments commencing on the first anniversary of the grant
date. In accordance with the terms of the Schuster Amendment,
the options were granted on April 29, 2010 with an exercise price of $3.69
per share.
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The
foregoing description of each of the Kent Agreement, the Kent Options, the
Transition Agreement, the Nadata Amendment, the Nadata Options, and the Schuster
Amendment is qualified in its entirety by reference to the full text of such
agreement, attached hereto as Exhibits 10.1, 10.2, 10.3, 10.4, 10.5 and
10.6, respectively, and incorporated herein by reference.
On
April 28, 2010, the Board of Directors of the Company approved an amendment
to the Company’s Executive Retirement Plan (the
“Amendment”). Pursuant to the Amendment, the definition of
“Retirement” was amended to incorporate the requirements of Section 409A of
the Internal Revenue Code of 1986, as amended (the “Code”) related to
the commencement of benefits under a deferred compensation plan subject to such
code section, such as the Company’s Executive Retirement Plan. The
Amendment also provides for the commencement of retirement benefits to
Mr. Nadata upon his death or Disability (as such term is defined in
Code Section 409A) in the event that such death or Disability precedes his
separation of service. The foregoing description of the Amendment is
qualified in its entirety by reference to the full text of the Amendment
attached hereto as Exhibit 10.7 and the Nu Horizons Electronics Corp.
Executive Retirement Plan, filed with the SEC as Exhibit 10.1 to the
Company’s Form 8-K dated March 28, 2005, both of which are incorporated
herein by reference.
Item
5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
Year.
On
April 28, 2010, the Board of Directors of the Company amended and restated
the Company’s By-Laws effective as of May 3, 2010. The By-Law provisions
are amended as follows: (i) Article III, Section 2, to change the
reference to a Nominating Committee to a Corporate Governance Committee;
(ii) Article IV, Section 2 to provide for (A) a Chairman of
the Board, and (B) the removal of the position of Executive Chairman of the
Board; and (iii) Article IV, Sections 3, 4 and 11 and
Article V, Section 1, to change to “Chairman” all references to
“Executive Chairman.”
The
foregoing description of the amendment of the By-Laws is qualified in its
entirety by reference to the full text of the By-Laws (as amended on
April 28, 2010) attached hereto as Exhibit 3.1 and incorporated herein
by reference.
Item
7.01 Regulation FD Disclosure.
On
April 29, 2010, the Company issued a press release with respect to the
matters described under Item 5.02(b), (c) and (e) of this Form 8-K. A
copy of the press release is furnished with this Form 8-K and attached hereto as
Exhibit 99.1. Item 7.01 and Exhibit 99.1 attached hereto shall
not be deemed "filed" for purposes of Section 18 of the Securities Exchange
Act of 1934, as amended, or otherwise subject to the liabilities of that
section, nor shall they be deemed incorporated by reference in any filing under
the Securities Act of 1933, as amended, regardless of any general incorporation
language in such filing.
(d)
Exhibits
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3.1
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Amended
and Restated By-Laws
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10.1
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Employment
Agreement between the Company and Martin Kent dated April 28,
2010
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10.2
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Stock
Option Agreement between the Company and Martin Kent dated April 29,
2010
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10.3
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Transition
Agreement between the Company and Arthur Nadata dated April 28,
2010
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10.4
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Amendment
No. 3 to Employment Agreement between the Company and Arthur Nadata dated
April 28, 2010
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10.5
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Stock
Option Agreement between the Company and Arthur Nadata dated April 29,
2010
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10.6
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Amendment
No. 3 to Employment Agreement between the Company and Richard Schuster
dated April 28, 2010
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10.7
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Amendment
No. 1 to Nu Horizons Electronics Corp. Executive Retirement Plan dated
April 28, 2010
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99.1
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Press
Release dated April 29,
2010
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Company has duly
caused this report to be signed on its behalf by the undersigned, hereunto duly
authorized.
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Nu
Horizons Electronics Corp.
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(Registrant)
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Date: May
3, 2010
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By:
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/s/
Kurt Freudenberg
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Name:
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Kurt
Freudenberg
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Title:
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Executive
Vice President and Chief
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Financial
Officer
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