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ODP > SEC Filings for ODP > Form 8-K on 5-Dec-2013All Recent SEC Filings

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Form 8-K for OFFICE DEPOT INC


5-Dec-2013

Change in Directors or Principal Officers, Other Events, Financial Statements an


Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Appointment of Stephen E. Hare as Executive Vice President, Chief Financial Officer

Effective December 2, 2013, Stephen E. Hare was appointed as the Executive Vice President, Chief Financial Officer of Office Depot, Inc. (the "Company"). Prior to joining the Company, Mr. Hare served as the Senior Vice President and Chief Financial Officer of The Wendy's Company, a restaurant owner, operator and franchisor, from July 2011 until September 2013. Mr. Hare also served as the Senior Vice President and Chief Financial Officer of Wendy's/Arby's Group, Inc., a position he held from October 2008 until July 2011. He also served as Chief Financial Officer of Arby's Restaurant Group, Inc., a restaurant owner, operator and franchisor ("Arby's"), from June 2006 until the sale of Arby's by The Wendy's Company in July 2011. Mr. Hare currently has a consulting agreement with The Wendy's Company, and the Company has agreed that, subject to the approval of the Company's Chief Executive Officer, Roland Smith (the "CEO"), Mr. Hare may continue to provide consulting activities to The Wendy's Company through January 1, 2014.

Prior to joining The Wendy's Company, Mr. Hare served as an Executive Vice President of Cadmus Communications Corporation ("Cadmus"), a leading publisher of scientific, technical, medical, and scholarly journals, and as President of Publisher Services Group, a division of Cadmus, from January 2003 to June 2006, and as the Executive Vice President, Chief Financial Officer of Cadmus from September 2001 to January 2003. Prior to that, Mr. Hare was the Executive Vice President and Chief Financial Officer of AMF Bowling Worldwide, Inc., an owner and operator of bowling centers from 1996 to 2001. From 1990 to 1996, Mr. Hare served as the Senior Vice President and Chief Financial Officer of James River Corporation, which was one of the world's largest paper companies with approximately 60 manufacturing facilities in North America and Europe. Mr. Hare currently serves as a director of Hanger, Inc., a provider of orthotic and prosthetic products and services that enhance human physical capability. Mr. Hare is 60.

Further information about Mr. Hare and his appointment as Executive Vice President, Chief Financial Officer is included in the Company's press release issued on December 2, 2013, which is attached as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.

Description of Agreements with Mr. Hare

Letter Agreement between the Company and Mr. Hare

The Company entered into a Letter Agreement (the "Letter Agreement") with Mr. Hare, which sets forth the terms of Mr. Hare's employment with the Company as the Company's Executive Vice President, Chief Financial Officer, effective December 2, 2013 (the "Effective Date").

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This summary of the Letter Agreement does not purport to be complete and is subject to and qualified in its entirety by reference to the text of the Letter Agreement filed as Exhibit 10.1 to this Current Report on Form 8-K. Exhibit 10.1 is incorporated herein by reference into this Item 5.02.

Base Salary. Mr. Hare will receive an annual base salary of $750,000, which may be increased from time to time.

Initial Performance Bonus. Mr. Hare is eligible to receive a lump sum cash initial performance bonus of up to $500,000 (the "Initial Performance Bonus"). The actual amount of the Initial Performance Bonus will be determined by the Compensation Committee of the Company's Board of Directors (the "Compensation Committee"), taking into consideration the recommendation of the CEO, based upon his achievement of the following performance objectives prior to December 31, 2013: (i) progress on the selection of the Company's Finance team; and
(ii) progress on the development of a Company budget for 2014. The Compensation Committee, taking into consideration the CEO's recommendation, shall make a good faith determination of the achievement of the foregoing objectives on or before March 15, 2014, and shall cause such Initial Performance Bonus, if any, to be paid to Mr. Hare not later than March 15, 2014. Mr. Hare must be employed by Company on March 15, 2014 in order to be eligible to receive the Initial Performance Bonus.

Bonuses. Beginning in 2014, Mr. Hare will be eligible to receive an annual target bonus equal to 85% of his base salary, based on achievement of performance goals established by the Company's Board of Directors (the "Board") or the Compensation Committee. In the event that Mr. Hare achieves superior performance goals established by the Board or the Compensation Committee, then he will be eligible to receive a bonus award of up to 170% of his base salary. Mr. Hare shall be eligible to receive an annual bonus commencing for calendar year 2014.

Option Grant. On the Effective Date, Mr. Hare was granted a ten-year non-qualified option (the "Option") to purchase 500,000 shares of the Company's common stock, par value $ .01 per share (the "Common Stock"). Material terms of the Option are summarized below under "Non-Qualified Stock Option Award Agreement Between the Company and Mr. Hare."

Restricted Stock Unit Grants. On the Effective Date, Mr. Hare was granted 229,533 restricted stock units ("Restricted Stock Units"). Material terms of the Restricted Stock Units are summarized below under "Restricted Stock Unit Award Agreement Between the Company and Mr. Hare."

Performance Share Units Grant. On the Effective Date, Mr. Hare was granted 149,533 performance share units ("Performance Shares"). Material terms of the Performance Shares are summarized below under "Performance Share Award Agreement Between the Company and Mr. Hare."

Other Long-Term Incentive Compensation. Commencing with the Company's 2015 fiscal year, Mr. Hare will be eligible to receive equity awards on a basis no less favorable than is provided to other similarly situated executives of the Company.

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Clawback Provisions. The incentive-based compensation or other amounts paid to Mr. Hare pursuant to the Letter Agreement or any other agreements or arrangements with the Company will be subject to clawback under any Company clawback policy that is uniformly applicable to similarly situated executive officers of the Company.

Employee Benefits. Mr. Hare will be eligible to participate in the Company's benefit programs, on a basis no less favorable than is provided to other similarly situated executive officers of the Company.

Change in Control Agreement. Following the Effective Date, Mr. Hare will be provided a Change in Control Agreement, which agreement will provide for severance benefits in the event that he is involuntarily terminated without Cause or voluntarily terminated with Good Reason following a Change in Control, as will be defined therein.

Indemnification/Director and Officer Liability Insurance. The Company will maintain director and officer liability insurance that covers Mr. Hare during his employment with the Company and for a period of six years thereafter.

Termination of Employment. If Mr. Hare is involuntarily terminated by the Company without Cause (as defined in the Letter Agreement) or voluntarily terminates his employment with the Company for Good Reason (as defined in the Letter Agreement), then the Company will pay to Mr. Hare the following as severance benefits:

(i) 18 months of his base salary at the rate in effect on the date of his employment termination;

(ii) 18 times the difference between the Company's monthly COBRA charge on the date of Mr. Hare's employment termination for the type of Company-provided group health plan coverage in effect for Mr. Hare on that date and the applicable active employee charge for such coverage; and

(iii) a pro-rata bonus calculated based on actual performance under the Company's annual bonus plan for the Company's fiscal year in which the termination occurs, with payment under this subsection (iii) being made to Mr. Hare at the same time as payments made to other participants in the corporate bonus program, as described in the Letter Agreement.

Mr. Hare's severance benefits are not subject to mitigation or offset of future or potential earnings.

Miscellaneous. Mr. Hare will also be eligible for four weeks of vacation. Mr. Hare will be eligible to participate in the Company's Executive Car Allowance Program in accordance with its terms, as the terms may be amended from time to time (currently, a bi-weekly car allowance of $600.00). In addition, Mr. Hare will be eligible to participate in the Company's corporate relocation program. The Company will also pay or will reimburse Mr. Hare for legal fees incurred in negotiating and entering into the Letter Agreement and related agreements and amendments, up to a maximum of $20,000.

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. . .


Item 8.01 Other events.

The Board of Directors of the Company has scheduled the Company's 2014 Annual Meeting of Shareholders for April 24, 2014 (the "2014 Annual Meeting"). Any shareholder proposal, including nominations of persons for election to the Board of Directors, must be received, according to the Company's Bylaws, by the Corporate Secretary at the Company's corporate offices, 6600 North Military Trail, Boca Raton, FL 33496, Attn: Office of the General Counsel, on or before 5:00 p.m. (Eastern Time) on December 25, 2013 and no later than close of business on January 24, 2014. Any proposal submitted outside this timeframe will not be considered timely and such business will be excluded from consideration at the meeting. For shareholders who wish to submit a proposal for consideration of inclusion in the 2014 Proxy Statement and presentation at the 2014 Annual Meeting of Shareholders pursuant to Rule 14a-8 under the Exchange Act, such proposal must be received by the Corporate Secretary at the Company's corporate offices no later than January 24, 2014, and otherwise must comply with Securities and Exchange Commission requirements in Rule 14a-8 in order to be considered for inclusion in the 2014 Proxy Statement.

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Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit 10.1    Letter Agreement between the Company and Mr. Hare

Exhibit 10.2    2013 Non-Qualified Stock Option Award Agreement between the Company
                and Mr. Hare

Exhibit 10.3    2013 Restricted Stock Unit Award Agreement between the Company and
                Mr. Hare

Exhibit 10.4    2013 Performance Share Award Agreement between the Company and Mr.
                Hare

Exhibit 99.1    Office Depot, Inc. News Release dated December 2, 2013

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