Business Context and Reporting Period
Company: LeMaitre Vascular, Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: November 3, 2008
Subject: Item 5.02 - Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers.
The filing discloses the execution of a new Managing Director Service Agreement with Peter R. Gebauer, effective October 1, 2008, superseding a 2003 agreement. Mr. Gebauer continues to serve as President, International Operations, and Managing Director of LeMaitre Vascular GmbH.
Key Financial Metrics
This filing does not report consolidated revenue, profit, cash flow, margins, debt, or liquidity metrics. It focuses exclusively on executive compensation terms.
| Compensation Component | Details |
|---|---|
| Base Salary (2008-2009) | €220,000 annually (pro-rated for remainder of 2008) |
| Performance Bonus (2008) | Up to €63,593 |
| Performance Bonus (Subsequent Years) | Up to not less than €72,978 |
| Equity Award (2008) | Restricted Stock Units with fair value approx. $50,000 (vesting over 5 years) |
| Equity Award (Subsequent Years) | Restricted Stock Units with fair value approx. €74,745 (vesting over 5 years) |
| Relocation Reimbursement | Up to $74,800 upon termination |
Material Changes Versus Prior Period
The primary material change is the replacement of the September 12, 2003 Executive Service Agreement with the new Service Agreement effective October 1, 2008. This update formalizes compensation structures, including specific bonus thresholds and equity grant values for the current and future fiscal years.
Guidance, Outlook, and Risks
Termination Provisions: The agreement outlines significant financial contingencies in the event of termination without "good cause" or death. The Company may be required to pay:
- A lump sum equal to 13.5 months of base salary (minus the notice period duration).
- A pro-rated portion of the annual cash performance bonus.
- Tax equalization payments for salary and bonus received through the termination notice date.
- Continuation of private health insurance for 7.5 months (minus the notice period duration).
- Reimbursement of up to $74,800 for relocation costs to the continental United States.
Tax Equalization: The Company provides quarterly tax equalization payments to ensure Mr. Gebauer's net compensation approximates what he would receive working in Massachusetts.
Key Facts for Investor Verification
- Verify the impact of the new compensation structure on the Company's operating expenses for the remainder of 2008 and 2009.
- Confirm the currency exchange rate assumptions used for the €220,000 salary and €74,745 equity awards when assessing total compensation costs in USD.
- Review the definition of "good cause" in the Service Agreement to understand the conditions under which the Company can avoid the 13.5-month severance payment.
- Assess the potential liability exposure regarding the $74,800 relocation reimbursement and health insurance continuation if Mr. Gebauer's employment is terminated.