Business Context and Reporting Period
This Form 8-K Current Report was filed by TTM Technologies, Inc. on March 19, 2010. The filing discloses the entry into material definitive agreements regarding executive compensation and severance arrangements effective as of the report date.
Key Financial Metrics
This filing does not contain financial performance data such as revenue, profit, cash flow, margins, debt, or liquidity. The document focuses exclusively on executive employment terms and potential severance liabilities.
Material Changes and Agreements
Restated Employment Agreement with CEO
- Executive: Kenton K. Alder, President and Chief Executive Officer.
- Term: Initial three-year term with automatic one-year renewals unless notice of non-renewal is given.
- Base Salary: $605,000, subject to board discretion for increases.
- Severance (Without Cause/Good Reason): Cash payment equal to 2x (Base Salary + Target Bonus).
- Change in Control Severance: If termination occurs within 60 days prior to or 12 months after a change in control, the payout increases to 3x (Base Salary + Target Bonus), with immediate acceleration of stock options and restricted stock.
- Restrictions: Non-competition and non-solicitation obligations apply for 12 months post-termination or the duration of severance payments, whichever is longer.
Executive Change in Control Severance Agreements
- Executives Covered: Steven W. Richards (EVP/CFO), Shane S. Whiteside (EVP/COO), and Douglas L. Soder (EVP).
- Trigger Events: Termination without "cause" during a pending change in control or within 12 months following a change in control; or resignation for "good reason" within 12 months following a change in control.
- Severance Package: Cash payment equal to 2x (Annual Base Salary + Target Bonus) plus immediate acceleration of equity awards (stock options, restricted stock, and RSUs).
- Superseding Agreements: These agreements replace prior arrangements dated December 1, 2005, for Messrs. Richards and Whiteside, and an October 2006 offer letter for Mr. Soder.
Guidance, Outlook, and Risks
The filing contains no financial guidance, operational outlook, or general risk factors. The primary contingency disclosed is the potential financial liability associated with executive severance in the event of a change in control or specific termination scenarios. The agreements impose significant cash and equity acceleration obligations if the company undergoes a change in control.
Key Facts for Investor Verification
- Verify the specific definitions of "cause," "good reason," and "change in control" in the attached Exhibits 10.9 and 10.17 to understand the precise triggers for severance.
- Confirm the current annual target bonus amounts for the covered executives to calculate potential maximum severance liabilities.
- Review the company's current equity grant status to assess the value of accelerated stock options and restricted stock units under the change in control provisions.
- Note that the CEO's base salary is fixed at $605,000 under this agreement, but the board retains discretion to increase it.