Fuller H B Co 8-K, filed Jan 21, 2020

Fuller H B Co (FUL)

8-K 2020-01-21 For: 2020-01-15

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Added on April 12, 2026

About this 8-K

Fuller H B Co filed this 8-K on January 21, 2020, reporting on events of January 15, 2020.

Items reported

Item 5.02: Director or officer change, or executive pay
Item 9.01: Financial statements and exhibits

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1200 Willow Lake Boulevard, P.O. Box 64683, St. Paul, Minnesota		55164-0683
(Address of principal executive offices)		(Zip Code)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $1.00	FUL	NYSE

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 DFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4 (c) under the Exchange Act (17 CFR 240.13e-4(c))

	(i)	The Operating Income metric is replaced with Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”);
	(ii)	Key Market metrics have been deleted for Executive Officers;
	(iii)	The weighting of EBITDA is 35% and Net Revenue is 35%, while Earnings Per Share (“EPS”) remains at a weighting of 30%; and
	(iv)	There are two plan designs: one for corporate positions (e.g., Chief Executive Officer and Chief Financial Officer) and one for executive officers in Operating Segments.

	•	Annual Base Salary effective February 1, 2020: $1,236,165, an increase of 5% in line with Company merit guidelines.

	•	Effective January 15, 2020, the target value of Mr. Owens’ stock-based awards under the Company’s Annual and Long-Term Incentive Plan (the “LTIP”) was increased from 350% of his base salary to 400% of his base salary.

	•	Mr. Owens’ incentive opportunity under the Company’s Management Short-Term Incentive Plan (the “STIP”) increased to a target incentive opportunity of 120% (from 110% in fiscal year 2019) of his base salary with a maximum incentive opportunity of up to 240% of his base salary under the STIP for the Company’s 2020 fiscal year.

	10.1	H.B. Fuller Company Management Short-Term Incentive Plan for Executive Officers
	104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

	H.B. FULLER COMPANY



	By:	/s/ Timothy J. Keenan
		Timothy J. Keenan
		Vice President, General Counsel and Corporate Secretary

Purpose	The STI plan provides an annual performance-based cash bonus opportunity for eligible employees. This is intended to achieve a number of goals including:

	●	Emphasizing the Company’s commitment to competitive compensation practices;

	●	Driving a high performance culture;

	●	Assuring accountability;

	●	Focusing on results, not activity; and

	●	Reinforcing the importance of measurable and aligned goals and objectives.

Eligibility	These guidelines apply to Executive Officers. To receive payment under the STI Plan, the participant must be actively employed as of November 30.


Plan Design	The plan design is based on the following financial metrics.

	●	EBITDA
	●	Net Revenue
	●	Earnings Per Share


	Each participant’s plan design will be based on the participant’s position. Details of the design are as follows:

	●	Corporate/Global

	Target
	●	Each metric will have a target level of performance. Payout will be determined for each metric based on performance relative to target. The target levels of performance will be established at the beginning of each fiscal year.

	Threshold
	●	Threshold performance levels will be established for each metric as follows:
		o	Net Revenue: 90% of target
		o	EBITDA: 80% of target
		o	EPS: 80% of target

	●	Payout at the threshold level of performance will be 50% of the target allocated to that metric.

	Superior
	●	Superior performance levels will be established for each metric as follows:
		o	Net Revenue: 110% of target
		o	EBITDA: 120% of target
		o	EPS: 120% of target

	●	Payout at the superior level of performance will be 200% of the target allocated to that metric.


	See Appendix for payout schedule.

Payment	Payment will be made in cash, subject to taxes and deductions as applicable. Payment will be made as close as possible to January 31 following the conclusion of the relevant Plan Year, but will be made no later than March 15^th of the calendar year following the Plan Year.

Participant Status Changes	If a participant begins employment with the company during the Plan Year, bonus potential will be pro-rated for the time the participant was employed during the Plan Year. If a participant transfers jobs and changes plan design standards, potential bonus will be pro-rated for the time spent in each job.

Administration	Participants may direct questions about the STI Plan to their local management or human resources representatives. The Compensation Committee of the Board of Directors shall make a certification decision with respect to performance of financial metrics and consider extraordinary circumstances that may have positively or negatively impacted the achievement of the objectives. The Board or management in their discretion, reserves the right at any time to enhance, diminish or terminate all or any portion of any compensation plan or program, on a collective or individual basis; provided.

STIP Payment Schedule for EPS,		STIP Payment schedule for
EBITDA		Net Revenue
Metric Performance	Payout (as % of target)	Metric Performance	Payout (as % of target)
120%	200.0%	110%	200%
119%	195.0%	109%	190%
118%	190.0%	108%	180%
117%	185.0%	107%	170%
116%	180.0%	106%	160%
115%	175.0%	105%	150%
114%	170.0%	104%	140%
113%	165.0%	103%	130%
112%	160.0%	102%	120%
111%	155.0%	101%	110%
110%	150.0%	100%	100%
109%	145.0%	99%	95%
108%	140.0%	98%	90%
107%	135.0%	97%	85%
106%	130.0%	96%	80%
105%	125.0%	95%	75%
104%	120.0%	94%	70%
103%	115.0%	93%	65%
102%	110.0%	92%	60%
101%	105.0%	91%	55%
100%	100.0%	90%	50%
99%	97.5%
98%	95.0%
97%	92.5%
96%	90.0%
95%	87.5%
94%	85.0%
93%	82.5%
92%	80.0%
91%	77.5%
90%	75.0%
89%	72.5%
88%	70.0%
87%	67.5%
86%	65.0%
85%	62.5%
84%	60.0%
83%	57.5%
82%	55.0%
81%	52.5%
80%	50.0%

Total Company Metrics Company EPS The adjusted EPS as disclosed in the Company’s quarterly earnings release. HBF Net Revenue
	●	The adjusted reported revenue as disclosed in the Company’s quarterly earnings release is adjusted for currency impact compared to budgeted exchange rates.

	●	Unbudgeted acquisitions and divestitures are excluded from the calculation.

HBF EBITDA (Consolidated)
	●	Adjusted Net Income plus Income Tax Expense plus Interest Expense, net, plus Depreciation Expense plus Amortization Expense

	●	Unbudgeted acquisitions and divestitures are excluded from the calculation.

Operating Segment Metrics Net Revenue
	●	Total company adjustments are transferred down to the region/operating segment revenue which is impacted by the adjustments, unless not approved by the CEO.

	●	Basis of targets is US dollars. The budgeted exchange rates will be used to assess performance.

	●	Unbudgeted acquisitions and divestitures are excluded from the calculation.

Fully allocated EBITDA
	●	Adjusted Gross Profit minus Adjusted SG&A expenses plus Depreciation Expense and Amortization Expense

	●	EBITDA targets include corporate governance allocation at budget. In determining performance, actual corporate governance allocations will be used.

	●	Total company adjustments are transferred down to the region/operating segment EBITDA which is impacted by the adjustments, unless not approved by the CEO.

	●	Basis of targets is US dollars. The budgeted exchange rates will be used to assess performance.

	●	Unbudgeted acquisitions and divestitures are excluded from the calculation.

Adjustments In calculating the results, the following adjustments will be made:
	a.	Individual legal settlements (payments or receipts) with a value (net of insurance) of $3 million or greater will not be included in metric calculations.
	b.	Any unbudgeted reorganization or restructuring-related items which cannot be offset by related benefits in the fiscal year will not be included in metric calculations.
	c.	Any unbudgeted asset write-downs in excess of $2 million will not be included in metric calculations.
	d.	Adjustments needed to (1) correct any inadvertent errors or miscalculations made in setting a performance target for our key markets (such as Hygiene, Packaging, or Durable Assembly) or (2) account for changes resulting from new accounting definitions, requirements or pronouncements.
	e.	Other items as publicly disclosed in the Company’s quarterly earnings release. However, the above adjustments (a-d) will not be made to the extent they are inconsistent with publicly disclosed earnings.

Any discretion related to total company adjustments transferred to the operating segment exercised by the CEO requires approval by the Compensation Committee of the Board of Directors.