ADTRAN Holdings, Inc 8-K, filed Dec 5, 2023
ADTRAN Holdings, Inc. (ADTN)
About this 8-K
ADTRAN Holdings, Inc filed this 8-K on December 5, 2023, reporting on events of December 1, 2023.
Items reported
- Item 5.02: Director or officer change, or executive pay
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d)
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| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
As previously reported in the Quarterly Report on Form 10-Q filed by ADTRAN Holdings, Inc. (the “Company”) with the Securities and Exchange Commission on November 9, 2023, as a result of ongoing uncertainty around the current macroeconomic environment and its impact on customer spending levels, the Company’s management previously determined to implement a comprehensive business efficiency program (the “Business Efficiency Program”). In connection with the Business Efficiency Program, on December 1, 2023, the Compensation Committee of the Board of Directors of the Company authorized the following temporary reductions in base salary for certain officers of the Company, which the officers had voluntarily agreed to prior to the Committee’s approval: a 50% reduction in base salary for Mr. Thomas R. Stanton (Chief Executive Officer) and a 25% reduction in base salary for each of Mr. James D. Wilson (Chief Revenue Officer), Mr. Ulrich Dopfer (Chief Financial Officer, Treasurer, and Secretary), and Mr. Christoph Glingener (Chief Technology Officer). Mr. Dopfer and Mr. Glingener each entered into an amendment to their employment agreements on December 4, 2023 with the Company’s subsidiary, Adtran Networks SE (the “Employment Agreement Amendments”), in order to effectuate the salary reduction. In addition, the Company reduced the compensation of Mr. Raymond Harris, a named executive officer as identified in the Company’s definitive proxy statement on Schedule 14A filed on March 28, 2023, by 25%. The salary reductions are effective for a period of seven months, through July 31, 2024.
Furthermore, on December 1, 2023, the Company granted Mr. Wilson and Mr. Harris stock options to purchase 16,878 and 13,067 shares of the Company’s common stock, respectively, under the Company’s Amended and Restated 2020 Employee Stock Incentive Plan. The stock options have an exercise price of $5.23 (the closing sales price of the Company’s common stock on the last trading day prior to the date of the grant), a term of ten years, and they will vest in two equal annual installments beginning on the first anniversary of the date of the grant, subject to each officer’s continued service through the applicable vesting date.
The foregoing description of the Employment Agreement Amendments and the stock options are not complete and are qualified in their entirety by each of the Employment Agreement Amendments and the Form of Stock Option Award Agreement, which are attached hereto as Exhibits 10.1, 10.2, and 10.3 and are incorporated herein by reference.
| Item 9.01 | Financial Statements and Exhibits. |
| Exhibit |
Description | |
| 10.1 | Eighteenth Amendment, dated December 4, 2023, to the Employment Agreement by and between Adtran Networks SE and Christoph Glingener | |
| 10.2 | Ninth Amendment, dated December 4, 2023, to the Employment Agreement by and between Adtran Networks SE and Ulrich Dopfer | |
| 10.3 | Form of Stock Option Award Agreement | |
| 104 | Cover Page Interactive Data File – the cover page iXBRL tags are embedded within the Inline XBRL document | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: December 5, 2023 | ADTRAN Holdings, Inc. | |||||
| By: | /s/ Ulrich Dopfer | |||||
| Ulrich Dopfer | ||||||
| Chief Financial Officer | ||||||
EXHIBIT 10.1
| Amendment to Officer’s Employment Agreement – Dienstvertragsänderung für Vorstandsmitglied | ||
| AMENDMENT TO OFFICER`S EMPLOYMENT AGREEMENT | DIENSTVERTRAGSÄNDERUNG VORSTANDSMITGLIED | |
| Adtran Networks SE, Martinsried/Meiningen | ||
| - hereinafter the “Company” – | - im Folgenden die “Gesellschaft” - | |
| represented by the Supervisory Board | vertreten durch den Aufsichtsrat | |
| and | und | |
| Mr./Herrn | ||
| Dr. Christoph Glingener | ||
| Sandweg 7 | ||
| 26349 Jade | ||
|
- hereinafter: the “Officer” -
1. Temporary Change of Base Salary payments
The Base Salary payments to the Officer shall be reduced by 25% temporarily beginning November 1, 2023 ending July 31, 2024 (“Temporary Base Salary Change”).
This Temporary Base Salary Change shall not affect or become the basis for the Annual Target Incentive Cash Bonus, the 2-Year Integration One-Time Bonus or any other annual and/or long-term fixed or variable bonuses or equity awards.
2. Clawback
The ADTRAN Holdings, Inc. POLICY FOR THE RECOVERY OF ERRONEOUSLY AWARDED COMPENSATION attached as Exhibit 1 (“Clawback Policy”) shall govern and apply to the Officer’s remuneration to the extent provided for in the Clawback Policy.
3. Miscellaneous
|
- im Folgenden: das “Vorstandsmitglied” –
1. Vorübergehende Änderung des Grundgehalts
Das Grundgehalt des Vorstandsmitglieds wird vom 1. November 2023 bis zum 31. Juli 2024 vorübergehend um 25 % reduziert („Vorübergehende Grundgehaltsänderung“).
Diese Vorübergehende Grundgehalts-änderung wirkt sich nicht auf den Annual Target Incentive Cash Bonus, den 2-Year Integration One-Time Bonus oder andere jährliche und/oder langfristige feste oder variable Boni oder Aktienprämien aus und wird auch nicht zur Grundlage hierfür.
2. Rückforderung
Die als Anlage 1 beigefügte Richtlinie der ADTRAN Holdings, Inc. zur Wiederherstellung irrtümlich zuerkannter Vergütungen („Clawback-Richtlinie“) regelt und gilt für alle rückforderungsberechtigten Anreizver-gütungen, die in der Clawback-Richtlinie definiert sind.
3. Sonstiges
| |
1
Amendment to Officer’s Employment Agreement – Dienstvertragsänderung für Vorstandsmitglied
| 3.1 Nothing in the Employment Agreement, as amended, shall be construed to prohibit the Officer from having reported or reporting possible violations of federal law or regulation or having filed or filing a charge or complaint with any governmental agency or entity, including, but not limited to the Department of Justice, Equal Employment Opportunity Commission, National Labor Relations Board, the Occupational Safety and Health Administration, the Securities and Exchange Commission, Congress, the Inspector General or any federal, state or local governmental agency or commission (each, a “Government Agency”). This Employment Agreement does not limit the Officer’s ability to communicate with any Government Agency or otherwise participate in any investigation or proceeding that may be conducted by any Government Agency, including providing documents or other information, without notice to the Company.
3.2 All other provisions of the existing Employment Agreement, including all subsequent amendments, shall apply without change.
3.3 Modifications of this Agreement require written form. This shall also apply to the amendment of this clause requiring written form.
3.3 The German version will be authoritative for the interpretation of this Amendment. |
3.1 Keine Bestimmung des Dienstvertrages in seiner geänderten Fassung ist so auszulegen, dass sie es dem Vorstandsmitglied verbietet, mögliche Verstöße gegen Bundesgesetze oder -vorschriften zu melden oder eine Anzeige oder Beschwerde bei einer Regierungsbehörde oder -stelle einzureichen, einschließlich, aber nicht beschränkt auf das Justizministerium, die Equal Employment Opportunity Commission, das National Labor Relations Board, die Occupational Safety and Health Administration, die Securities and Exchange Commission, den Kongress, den Generalinspektor oder eine Regierungsbehörde oder -kommission auf Bundes-, Landes- oder Kommunalebene (jeweils eine “Regierungsbehörde”). Dieser Dienstvertrag schränkt die Fähigkeit des Vorstandsmitglieds nicht ein, mit einer Regierungsbehörde zu kommunizieren oder anderweitig an einer Untersuchung oder einem Verfahren teilzunehmen, das von einer Regierungsbehörde durchgeführt wird, einschließlich der Bereitstellung von Dokumenten oder anderen Informationen, ohne dass die Gesellschaft davon in Kenntnis gesetzt wird.
3.2 Im Übrigen findet der bestehende Dienstvertrag einschließlich aller nachfolgenden Änderungen und Ergänzungen unverändert Anwendung.
3.2 Änderungen dieses Vertrages bedürfen der Schriftform. Dies gilt auch für die Abänderungen dieser Schriftformklausel.
3.3 Für die Auslegung dieses Vertrages ist die deutsche Fassung maßgeblich. |
| 11/27/2023 | 12/4/2023 | |
| /s/ Dr. Eduard Scheiterer |
/s/ Dr. Christoph Glingener | |
| Dr. Eduard Scheiterer | Dr. Christoph Glingener | |
| Chairman of the Supervisory Board | ||
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EXHIBIT 10.2
| Amendment to Officer’s Employment Agreement – Dienstvertragsänderung für Vorstandsmitglied | ||
| AMENDMENT TO OFFICER`S EMPLOYMENT | DIENSTVERTRAGSÄNDERUNG | |
| AGREEMENT | VORSTANDSMITGLIED | |
| Adtran Networks SE, Martinsried/Meiningen | ||
| - hereinafter the “Company” – | - im Folgenden die “Gesellschaft” - | |
| represented by the Supervisory Board | vertreten durch den Aufsichtsrat | |
| and | und | |
| Mr./Herrn | ||
| Ulrich Dopfer | ||
| 1710 Bucks Club Drive, | ||
| Alpharetta, Georgia, 30005 USA | ||
| - hereinafter: the “Officer”- | - im Folgenden: das “Vorstandsmitglied” – | |
| 1. Temporary Change of Base Salary payments |
1. Vorübergehende Änderung des Grundgehalts | |
| The Base Salary payments to the Officer shall be reduced by 25% temporarily beginning November 1, 2023 ending July 31, 2024 (“Temporary Base Salary Change”). | Das Grundgehalt des Vorstandsmitglieds wird vom 1. November 2023 bis zum 31. Juli 2024 vorübergehend um 25 % reduziert („Vorübergehende Grundgehaltsänderung“). | |
| This Temporary Base Salary Change shall not affect or become the basis for the Annual Target Incentive Cash Bonus, the 2-Year Integration One-Time Bonus or any other annual and/or long-term fixed or variable bonuses or equity awards. | Diese Vorübergehende Grundgehalts-änderung wirkt sich nicht auf den Annual Target Incentive Cash Bonus, den 2-Year Integration One-Time Bonus oder andere jährliche und/oder langfristige feste oder variable Boni oder Aktienprämien aus und wird auch nicht zur Grundlage hierfür. | |
| 2. Clawback |
2. Rückforderung | |
| The ADTRAN Holdings, Inc. POLICY FOR THE RECOVERY OF ERRONEOUSLY AWARDED COMPENSATION attached as Exhibit 1 (“Clawback Policy”) shall govern and apply to the Officer’s remuneration to the extent provided for in the Clawback Policy. | Die als Anlage 1 beigefügte Richtlinie der ADTRAN Holdings, Inc. zur Wiederherstellung irrtümlich zuerkannter Vergütungen („Clawback-Richtlinie“) regelt und gilt für alle rückforderungsberechtigten Anreizver-gütungen, die in der Clawback-Richtlinie definiert sind. | |
| 3. Miscellaneous |
3. Sonstiges | |
1
Amendment to Officer’s Employment Agreement – Dienstvertragsänderung für Vorstandsmitglied
| 3.1 Nothing in the Employment Agreement, as amended, shall be construed to prohibit the Officer from having reported or reporting possible violations of federal law or regulation or having filed or filing a charge or complaint with any governmental agency or entity, including, but not limited to the Department of Justice, Equal Employment Opportunity Commission, National Labor Relations Board, the Occupational Safety and Health Administration, the Securities and Exchange Commission, Congress, the Inspector General or any federal, state or local governmental agency or commission (each, a “Government Agency”). This Employment Agreement does not limit the Officer’s ability to communicate with any Government Agency or otherwise participate in any investigation or proceeding that may be conducted by any Government Agency, including providing documents or other information, without notice to the Company. |
3.1 Keine Bestimmung des Dienstvertrages in seiner geänderten Fassung ist so auszulegen, dass sie es dem Vorstandsmitglied verbietet, mögliche Verstöße gegen Bundesgesetze oder -vorschriften zu melden oder eine Anzeige oder Beschwerde bei einer Regierungsbehörde oder -stelle einzureichen, einschließlich, aber nicht beschränkt auf das Justizministerium, die Equal Employment Opportunity Commission, das National Labor Relations Board, die Occupational Safety and Health Administration, die Securities and Exchange Commission, den Kongress, den Generalinspektor oder eine Regierungsbehörde oder -kommission auf Bundes-, Landes- oder Kommunalebene (jeweils eine “Regierungsbehörde”). Dieser Dienstvertrag schränkt die Fähigkeit des Vorstandsmitglieds nicht ein, mit einer Regierungsbehörde zu kommunizieren oder anderweitig an einer Untersuchung oder einem Verfahren teilzunehmen, das von einer Regierungsbehörde durchgeführt wird, einschließlich der Bereitstellung von Dokumenten oder anderen Informationen, ohne dass die Gesellschaft davon in Kenntnis gesetzt wird. | |
| 3.2 All other provisions of the existing Employment Agreement, including all subsequent amendments, shall apply without change. |
3.2 Im Übrigen findet der bestehende Dienstvertrag einschließlich aller nachfolgenden Änderungen und Ergänzungen unverändert Anwendung. | |
| 3.3 Modifications of this Agreement require written form. This shall also apply to the amendment of this clause requiring written form. |
3.2 Änderungen dieses Vertrages bedürfen der Schriftform. Dies gilt auch für die Abänderungen dieser Schriftformklausel. | |
| 3.3 The German version will be authoritative for the interpretation of this Amendment. |
3.3 Für die Auslegung dieses Vertrages ist die deutsche Fassung maßgeblich. | |
| 11/27/2023 | 12/4/2023 | |
| /s/ Dr. Eduard Scheiterer |
/s/ Ulrich Dopfer | |
| Dr. Eduard Scheiterer |
Ulrich Dopfer | |
| Chairman of the Supervisory Board |
||
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EXHIBIT 10.3
ADTRAN HOLDINGS, INC.
AMENDED AND RESTATED
2020 EMPLOYEE STOCK INCENTIVE PLAN
EMPLOYEE NONQUALIFIED STOCK OPTION AGREEMENT
NONQUALIFIED STOCK OPTION (the “Option”) granted on [ ] (the “Date of Grant”), by ADTRAN Holdings, Inc., a Delaware corporation (the “Corporation”), to [ ] (the “Grantee”).
1. GRANT OF OPTION. The Corporation hereby grants to the Grantee the irrevocable Option to purchase, on the terms and subject to the conditions set forth in this agreement (this “Stock Option Agreement”) and in the Plan (as defined below), up to [ ] fully paid and nonassessable shares of the Corporation’s Common Stock at the option price of $[ ] per share, being the Fair Market Value of a share of Common Stock on the Date of Grant.
The Option is granted pursuant to the Corporation’s Amended and Restated 2020 Employee Stock Incentive Plan (the “Plan”), a copy of which is attached hereto. The Option is subject in its entirety to all the applicable provisions of the Plan as in effect on the Date of Grant, which are hereby incorporated herein by reference. Capitalized terms used but not defined herein will have the meaning ascribed to them in the Plan. The Option is intended to be a Nonqualified Stock Option and not an Incentive Stock Option within the meaning of Section 422 of the Internal Revenue Code.
2. CONSIDERATION. The grant of the Option is made in consideration of the services to be rendered by the Grantee to the Corporation.
3. VESTING SCHEDULE; EXPIRATION. Subject to Sections 5.3, 5.4, 5.5 and 6.4(b) of the Plan, the Option will vest and become cumulatively exercisable in installments in accordance with the following schedule:
| Anniversary of the Date of Grant: |
Vested Percentage: | |||
Any portion or portions of the Option that have vested pursuant to the terms of this Option Agreement are collectively referred to as “Vested Options.” Vested Options may be exercised from time to time following vesting and prior to the Expiration Date (as defined below) as to the total number of shares allowable under this Section 3, or any lesser amount thereof, subject to Section 6 of this Option Agreement. Notwithstanding anything contained herein to the contrary, the Option will expire and no longer be exercisable on the tenth (10th) anniversary of the Date of Grant, or earlier as provided in the Plan (the “Expiration Date”).
4. BENEFICIARY. The Grantee has designated any Beneficiaries and/or contingent Beneficiaries of the Option in accordance with Section 10.1 the Plan.
5. METHOD OF EXERCISE OF OPTION; PAYMENT OF EXERCISE PRICE; TAX WITHHOLDING. The Vested Options shall be exercised through a notice submitted via Morgan Stanley’s StockPlan Connect, which may be accessed at http://www.stockplanconnect.com, or by written (or electronic) notice of exercise directed to such other Person as the Compensation
Committee of the Board of Directors of the Corporation (the “Committee”) may direct. Each notice of exercise shall identify the Option that the Grantee is exercising (in whole or in part) and shall be accompanied by (i) payment of the Exercise Price, as well as all applicable withholding taxes, for the number of shares specified in such notice, in accordance with Sections 6.7 and 10.4 of the Plan and (ii) such other documents as required by the Plan or the Committee, if any.
6. MINIMUM EXERCISE. Grantee may exercise the Option for less than the full number of shares of Common Stock subject to the Option. However, each exercise may not be made for less than 100 shares or, if less, the total remaining shares subject to the Option.
7. ISSUANCE OF SHARES. Provided that the exercise notice and payment are in form and substance satisfactory to the Corporation, the Corporation shall issue the shares of Common Stock registered in the name of the Grantee, the Beneficiary, or the Grantee’s legal representative, as applicable.
8. NO RIGHT TO CONTINUED EMPLOYMENT; NO RIGHTS AS SHAREHOLDER. Neither the Plan nor this Stock Option Agreement shall confer upon the Grantee any right to be retained in any position, including as an Employee or service provider, of the Corporation. Further, nothing in the Plan or this Stock Option Agreement shall be construed to limit the discretion of the Corporation to terminate the Grantee’s service at any time, with or without Cause. The Grantee shall not have any rights as a shareholder with respect to any shares of Common Stock subject to the Option prior to the date of exercise of the Option.
9. TRANSFERABILITY. Except as otherwise provided in the Plan, the Option shall not be assignable or transferable by the Grantee, and any purported transfer (other than as excepted above) shall be null and void.
10. COMPLIANCE WITH LAW. The exercise of the Option and the issuance and transfer of shares of Common Stock shall be subject to compliance by the Corporation and the Grantee with all applicable requirements of federal and state securities laws and with all applicable requirements of any stock exchange on which the Corporation’s shares of Common Stock may be listed. No shares of Common Stock shall be issued pursuant to this Option unless and until any then applicable requirements of state or federal laws and regulatory agencies have been fully complied with to the satisfaction of the Corporation and its counsel. The Grantee understands that the Corporation is under no obligation to register the shares of Common Stock with the Securities and Exchange Commission, any state securities commission or any stock exchange to effect such compliance.
11. AMENDMENT. The Committee has the right to amend, alter, suspend, discontinue or cancel the Option, prospectively or retroactively; provided, that, no such amendment shall adversely affect the Grantee’s material rights under this Stock Option Agreement without the Grantee’s consent.
12. COUNTERPARTS. This Stock Option Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument. Counterpart signature pages to this Stock Option Agreement transmitted by facsimile transmission, by electronic mail in portable document format (.pdf), or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing an original signature.
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13. ACCEPTANCE. The Grantee hereby acknowledges receipt of a copy of the Plan and this Stock Option Agreement. The Grantee has read and understands the terms and provisions thereof and hereof, and accepts the Option subject to all of the terms and conditions of the Plan and this Stock Option Agreement. The Grantee acknowledges that there may be adverse tax consequences upon exercise of the Option or disposition of the underlying shares and that the Grantee should consult a tax advisor prior to such exercise or disposition.
14. BINDING AGREEMENT. This Stock Option Agreement shall be binding upon and shall inure to the benefit of any successor or assign of the Corporation, and, to the extent herein provided, shall be binding upon and inure to the benefit of the Grantee’s Beneficiary or legal representatives, as the case may be.
15. ENTIRE AGREEMENT. This Stock Option Agreement and the Plan set forth the entire agreement of the parties with respect to the Option granted hereby and may not be changed orally but only by an instrument in writing signed by the party against whom enforcement of any change, modification or extension is sought.
[Signature Page Follows]
3
If the foregoing is in accordance with your understanding and approved by you, please so confirm by signing and returning the duplicate of this Stock Option Agreement enclosed for that purpose.
| ADTRAN HOLDINGS, INC. | ||
| By: |
| |
| Name: | ||
| Title: | ||
The foregoing is in accordance with my understanding and is hereby confirmed and agreed to as of the Date of Grant.
| GRANTEE |
|
|
| [Name] |
[Signature Page to Employee Stock Option Agreement]