Business Context and Reporting Period
This Form 8-K Current Report was filed by SYNNEX Corporation on February 9, 2006, covering events occurring on February 7 and 8, 2006. The filing details the entry into material definitive agreements regarding executive compensation and credit facility amendments.
Key Financial Metrics
The filing does not provide specific revenue, profit, cash flow, margin, or debt figures. It focuses on contractual terms and compensation structures rather than financial performance results.
Material Changes and Agreements
- 2006 Profit Sharing Program: Approved for executive officers, tying bonuses to Company net income targets. Bonuses are paid on a sliding scale if threshold performance percentages are met. CEO Robert Huang retains discretion to adjust other officers' bonuses by up to 30%.
- CEO Employment Agreement: A four-year agreement was approved for Robert Huang, President and CEO.
- Base Salary: $400,000 annually.
- Equity Award: 250,000 restricted stock units (RSUs) vesting 25% at 13 months and 25% annually thereafter.
- Severance: In the event of termination without cause or for "good reason," Mr. Huang is entitled to 12 months of base salary, prorated profit sharing, 12 months of health premium reimbursement, and 100% accelerated vesting of unvested equity.
- Chairman Compensation: A $225,000 retainer was approved for fiscal 2006 for Chairman Matthew Miau, unchanged from the prior year.
- Credit Agreement Amendment: Amendment No. 8 to the Credit Agreement with General Electric Capital Corporation and Bank of America, N.A. was executed on February 8, 2006. This amendment increases the lending and guarantee limits for the Company's Canada and Mexico subsidiaries.
Guidance, Outlook, and Risks
The filing contains no forward-looking financial guidance, management commentary on market outlook, or discussion of specific risks and contingencies beyond the terms of the new agreements.
Key Facts for Investor Verification
- Verify the impact of the new CEO employment agreement on future compensation expenses and potential severance liabilities.
- Confirm the specific dollar amounts or percentage increases allowed for lending to Canada and Mexico subsidiaries under the credit amendment.
- Review the vesting schedule and performance conditions for the 250,000 RSUs granted to the CEO.
- Assess the implications of the CEO's 30% discretionary authority over other executive bonuses on total compensation costs.