UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
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
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 1, 2011
ORION ENERGY SYSTEMS, INC.
| Wisconsin | 01-33887 | 39-1847269 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
2210 Woodland Drive, Manitowoc, WI 54220
(Address of principal executive offices, including zip code)
(920) 892-9340
(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:
| 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 April 1, 2011, Michael W. Harris was promoted to Chief Financial Officer of Orion Energy
Systems, Inc. (the “Company”) after serving as the Company’s Vice President — Investor Relations
since October 2010. Prior to joining the Company, Mr. Harris, age 39, was the founder and owner
of, and an independent consultant with, Harris Business Solutions LLC, a financial services
company, from 2005 until 2010. With Harris Business Solutions LLC, Mr. Harris provided analysis of
accounting and other financial topics to portfolio managers and research analysts at money
management firms as well as temporary chief financial officer services to business owners. Mr.
Harris was an equity research analyst with Robert W. Baird & Co. Incorporated, a wealth management,
capital markets, asset management and private equity firm, from 1999 until 2005. He also held a
number of positions, including manager of accounting and auditing, with Kolb Lauwasser & Co. (now
known as Kolb+Co.), a financial services company, from 1995 to 1999, and was a staff accountant
with KPMG Peat Marwick, LLP (now known as KPMG LLP), an audit, tax and advisory firm, from 1994
until 1995. Mr. Harris is a certified public accountant.
In connection with his promotion, the Company entered into a new employment agreement with Mr.
Harris (the “Employment Agreement”), increased his annual base salary from $150,000 to $225,000 and
agreed to grant Mr. Harris a non-qualified stock option to purchase 58,000 shares of the Company’s
common stock that will vest and become exercisable at a rate of 20% per year on each of the first
five anniversaries of the grant date, contingent on continued employment. In accordance with the
Company’s policy on the timing of option grants, the option will have an effective grant date of
the third business day following the Company’s release of its fiscal year 2011 financial results,
and will have an exercise price per share equal to the closing price of a share of the Company’s
common stock on the grant date.
Under the Employment Agreement, the Company will employ Mr. Harris for an initial term through
March 31, 2012, after which the Employment Agreement will automatically renew for successive terms
of one year unless either party provides advance notice of non-renewal. The Employment Agreement
specifies that Mr. Harris will serve as the Company’s Chief Financial Officer, and provides that he
will devote his full business time and best efforts to the performance of his duties under the
Employment Agreement. The Employment Agreement provides for a base salary of $225,000 for fiscal
year 2012, subject to potential increase from time to time by the Company, and specifies that Mr.
Harris will be entitled to participate in incentive plans and programs and other employee benefit
plans generally made available to the senior executives of the Company.
Under the Employment Agreement, if Mr. Harris’s employment is terminated without “Cause” (as
defined in the Employment Agreement) or for “Good Reason” (as defined in the Employment Agreement)
prior to the end of the employment period, he will be entitled to (i) a lump sum severance benefit
equal to 0.75 times the sum of his base salary plus the average of the prior three years’ bonuses;
(ii) a pro rata bonus for the year of the termination; and (iii) COBRA premiums at the active
employee rate for the duration of Mr. Harris’s COBRA continuation coverage period. The Employment
Agreement also requires Mr. Harris not to, during his employment and for two years following the
termination of his employment, (x) disclose any confidential information of the Company, (y)
compete with the Company or (z) solicit the employees or other persons with business relationships
with the Company.
The Employment Agreement provides that, upon a Change of Control (as defined in the Employment
Agreement), the term of the Employment Agreement would automatically be extended for 1.5 years.
Following the Change of Control, the Employment Agreement provides for the same base
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salary as before the Change of Control and a bonus opportunity at least equal to 100% of the
prior year’s target award and with the same general probability of achieving performance goals as
prior to the Change of Control. In addition, the Employment Agreement provides for participation
in salaried and executive benefit plans that provide benefits, in the aggregate, at least as great
as the benefits being provided prior to the Change of Control. The severance provisions would
remain the same as in the pre-Change of Control context as described above, except that the
multiplier used to determine the severance amount would increase from 0.75 to 1.5 and the
post-Change of Control employment term would increase from one to 1.5 years.
The Employment Agreement contains a “valley” excise tax provision that provides that all
amounts payable to Mr. Harris under his Employment Agreement and any other of the Company’s
agreements or plans that constitute change of control payments will be cut back to one dollar less
than three times his “base amount,” as defined by Internal Revenue Code (“Code”) Section 280G,
unless Mr. Harris would retain a greater amount by receiving the full amount of the payment and
personally paying the excise taxes. Under the Employment Agreement, the Company would not be
obligated to gross up Mr. Harris for any excise taxes imposed on excess parachute payments under
Code Section 280G or 4999.
Also effective April 1, 2011, Scott R. Jensen, who had served as the Company’s Chief Financial
Officer since July 2008, was named the Company’s Chief Accounting Officer. Mr. Jensen, age 44,
will also continue as the Company’s Treasurer. Mr. Jensen served as the Company’s Controller and
Vice President of Corporate Finance since 2007, and as Director of Finance from 2004 to 2007. From
2002 to 2004, Mr. Jensen was the manager of financial planning and analysis at the Mirro Co. (a
division of Newell Rubbermaid). Mr. Jensen is a certified public accountant.
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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.
| ORION ENERGY SYSTEMS, INC. |
||||
| Date: April 7, 2011 | By: | /s/ Neal R. Verfuerth | ||
| Neal R. Verfuerth | ||||
| Chief Executive Officer | ||||
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