Business Context and Reporting Period
This Form 8-K was filed by Dana Corporation on January 5, 2006. The report discloses the entry into a Material Definitive Agreement regarding a Supplemental Executive Retirement Plan for Nick L. Stanage, President of Heavy Vehicle Products.
Key Financial Metrics
The filing does not provide standard financial metrics such as revenue, profit, cash flow, margins, debt, or liquidity. The document focuses exclusively on the terms of a specific executive compensation agreement.
Material Changes and Agreement Details
The primary material event is the creation of an unfunded, non-qualified pension plan for Mr. Stanage to replace benefits forfeited from a prior employer. Key terms include:
- Normal Retirement Benefit: A lump sum of $2,095,500 payable if Mr. Stanage remains employed until age 62.
- Early Termination: In the event of death, disability, or involuntary termination (other than for cause) before age 62, the benefit is the greater of a pro-rata share based on credited service or 50% of the normal benefit.
- Voluntary Resignation/Retirement: If occurring after August 29, 2010, and before age 62, the benefit is a pro-rata share based on credited service.
- Change in Control: The normal retirement benefit becomes fully vested, with a lump sum payment due within 30 days.
Guidance, Outlook, and Risks
The filing contains no financial guidance, outlook, or general management commentary regarding company performance. The agreement is subject to the Employee Retirement Income Security Act of 1974 and Section 409A of the Internal Revenue Code. The primary contingency is the vesting schedule tied to Mr. Stanage's continued employment and the definition of a "change in control."
Investor Verification Checklist
- Verify the total potential liability of $2,095,500 and its impact on future compensation expenses.
- Review the attached Exhibit 99.1 for the full legal text of the Supplemental Executive Retirement Plan.
- Confirm the definition of "cause" and "change in control" within the plan to understand acceleration triggers.
- Note that the plan is unfunded, meaning the liability remains on the company's balance sheet until paid.