Dynamic Materials Corp - Current report filing (8-K)
January 15 2008 - 4:48PM
Edgar (US Regulatory)
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 9,
2008
Dynamic Materials Corporation
(Exact Name of Registrant as Specified in its
Charter)
Delaware
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0-8328
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84-0608431
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(State or Other
Jurisdiction of Incorporation)
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(Commission File
Number)
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(I.R.S. Employer
Identification No.)
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5405 Spine Road
Boulder, Colorado 80301
(Address of Principal Executive Offices, Including
Zip Code)
(303) 665-5700
(Registrants Telephone Number, Including Area Code)
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
1.01 Entry into a Material
Definitive Agreement.
On January 9, 2008, the
Board of Directors of Dynamic Materials Corporation (the Company) approved a Supplemental
Executive Retirement Plan (the SERP) for the Companys three senior U.S.
executives: Messrs. Yvon Cariou, Richard Santa and John Banker. Under the terms of the SERP, the Compensation
Committee of the Board granted restricted shares of Company stock to the three
executives on January 9, 2008, at the closing price of $49.22, as follows:
Executive Officer
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Number of Shares of
Restricted Stock Granted
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Yvon Cariou
President and Chief Executive Officer
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35,000
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John Banker
Vice President, Marketing and Sales, Clad Metal Division
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30,000
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Richard Santa
Vice President, Chief Financial Officer and Secretary
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25,000
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The shares vest for each
executive upon the completion, from the date of grant, of five additional years
of service with the Company. The shares
will vest immediately if the executives employment with the Company is
terminated:
·
involuntarily by the Company without cause,
as that term is defined in the executives employment agreements with the
Company;
·
by the executive, for good reason, which
shall mean substantial diminution in the executives responsibilities or pay,
as well as without the executives consent a relocation of his principal
place of business of more than 50 miles, or a substantial increase in his
travel duties compared to the present;
·
by reason of the death or disability of the
executive; or
·
upon a change in control of the Company,
where Company stock or an equivalent stock is no longer provided.
The Board intends to revisit the
SERP after five years, to determine whether to grant the then-present senior
executive team a new round of restricted stock, subject to whatever vesting
schedule and assumptions about future service, pay increases and increases in
stock value may be appropriate under the circumstances. During the next five years, the Compensation
Committee of the Board may also grant restricted shares to additional
executives of the Company, using the same pension principles described below.
2
The Compensation Committee used
the principles of a defined benefit pension plan to determine the number of
shares to be granted to each of the executives.
That is, it did the following:
·
It established this formula for an annual
pension benefit, payable for life starting upon retirement from the Company at
or after age 65, and actuarially reduced if the benefit starts before age 65:
2% of final average pay per year of service.
For final average pay, the Committee used the highest three
consecutive years average annual pay, and pay is defined as annual salary
plus one-half of the executives annual bonus.
The formula counts all future service up to five years, and 7.1, 11.3
and 15 years of past service for Messrs. Cariou, Santa and Banker,
respectively.
·
It calculated the annual pension benefit that
it projects that each executive will earn after the completion of five more
years of service with the Company, assuming a 5% annual increase in his pay from
his 2007 compensation. It then
calculated the lump sum present value, as of January 9, 2008, of the
projected annual pension benefit payable five years hence, assuming a 6.5%
annual increase in the value of the Companys stock. Using the closing price of a share of Company
stock on January 9, 2008, it then determined the number of shares of stock
to be granted on this date whose value equals the lump sum present value
described above, and rounded that number to the next higher thousand.
The Company will expense the
costs of the SERP for the executives over their five-year vesting period. The executives will owe income taxes on the
value of their restricted shares in the year when the shares vest. This value will be tax-deductible to the
Company in the same year.
Item 5.02 Departure of Directors or Certain
Officers; Election of Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
The
information in Item 1.01 of this report is incorporated into this Item 5.02 by
reference.
3
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.
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DYNAMIC
MATERIALS CORPORATION
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Dated: January 15,
2008
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By:
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/s/ Richard
A. Santa
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Richard A.
Santa
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Vice
President and Chief Financial Officer
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4
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