8-K
Modine Manufacturing Co (MOD)
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 3, 2020
Modine Manufacturing Company
(Exact name of registrant as specified in its charter)
| Wisconsin | 001-01373 | 39-0482000 |
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| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification Number) |
| 1500 DeKoven Avenue, Racine, Wisconsin | 53403 | |
| --- | --- | |
| (Address of principal executive offices) | (Zip Code) | |
| Registrant’s telephone number, including area code: | (262) 636-1200 | |
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| (Former name or former address, if changed since last report.) | N/A |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock, $0.625 par value | MOD | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230 .40 5 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Information to be Included in the Report
| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers |
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Appointment and Departure of Executive Officers
On August 3, 2020, the board of directors (the “Board”) of Modine Manufacturing Company (the “Company”) took the following actions concerning the executive officers of the Company and the Board:
| • | Michael B. Lucareli, Vice President, Finance and Chief Financial Officer, was named Interim President and Interim Chief Executive Officer, effective as of August 4, 2020. Mr. Lucareli will also retain his current position as Vice<br> President, Finance and Chief Financial Officer of the Company. In connection with his appointment, the Board approved an increase in Mr. Lucareli’s annual base salary to $650,000 and in his target annual bonus to 100% of his annual base<br> salary. There are no arrangements or understandings pursuant to which Mr. Lucareli was appointed Interim President and Interim Chief Executive Officer, and Mr. Lucareli has no direct or indirect material interest in any transaction<br> required to be disclosed pursuant to Item 404(a) of Regulation S-K.<br><br> <br><br><br> <br>Mr. Lucareli, 51, was named Vice President, Finance, and Chief Financial Officer on July 12, 2010. He leads Modine’s global finance, information technology and corporate strategy functions. Mr. Lucareli joined Modine in August 1999 and<br> has held a variety of leadership roles, including Manager, Business Development and Investor Relations; Director, Financial Operations and Analysis; Managing Director, Financial Operations; and Vice President, Corporate Treasurer. Before<br> joining Modine, Mr. Lucareli was Director of Research at Alpha Investments Group and a securities analyst and portfolio manager at Associated Investment Management Group. Mr. Lucareli earned a bachelor’s degree in economics from the<br> University of Wisconsin – Madison and a Master of Business Administration (MBA) from Loyola University in Chicago. He also holds a Chartered Financial Analyst (CFA) designation. |
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| • | Thomas A. Burke, President and Chief Executive Officer, will step down as Chief Executive Officer and President and resign from the Board, effective August 4, 2020, and will leave the Company on August 28, 2020. The Company has<br> determined that Mr. Burke will be eligible to receive severance payments and benefits in accordance with the non-cause termination provisions of his existing employment agreement, which is memorialized in a Transition and Separation<br> Agreement and will be subject to his timely execution and non-revocation of a general release of claims against the Company. As part of the Transition and Separation Agreement, Mr. Burke’s noncompetition obligations will extend for one year<br> (rather than three years) after his employment termination. |
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The foregoing description of the Transition and Separation Agreement for Mr. Burke is qualified in its entirety by the terms of the agreement, a copy of which will be filed as an exhibit to the Company’s Form 10-Q for the quarter ending September 30, 2020.
Fiscal 2020 Annual Cash Bonus Awards
On August 3, 2020, the Officer Nomination and Compensation Committee of the Board (the “Compensation Committee”) of the Company approved the fiscal 2020 annual bonus award for Mr. Burke under the Company’s Management Incentive Plan (“MIP”), which previously had been preliminarily approved (but not finalized). The table below updates the previously reported Summary Compensation Table by including the fiscal 2020 MIP annual bonus award payable to Mr. Burke, and revising Mr. Burke’s total compensation amount for fiscal 2020.
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| Name and Principal Position | Non-<br> Equity Incentive<br> Plan<br> Compensation<br> () | Total<br> () |
|---|---|---|
| Thomas A. Burke | ||
| President and Chief Executive Officer |
All values are in US Dollars.
| Item 7.01. | Regulation FD Disclosure. |
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The information in this Item 7.01 of this Current Report on Form 8-K, including the exhibit attached hereto, is furnished pursuant to Item 7.01 and shall not be deemed “filed” for any purpose, including for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section. The information in this Item 7.01 of this Current Report on Form 8-K, including the exhibit attached hereto, shall not be deemed incorporated by reference into any filing under the Exchange Act regardless of any general incorporation language in such filing.
On August 4, 2020, we issued a press release regarding actions concerning the executive officers and the Board of the Company. The text of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein.
Forward-Looking and Cautionary Statements
This Current Report on Form 8-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements can be identified by the use of words such as “expect,” “plan,” “will,” “estimate,” “project,” “intend,” “believe,” “guidance,” and other similar expressions that do not relate to historical matters. These forward-looking statements are subject to known and unknown risks and uncertainties that can cause actual results to differ materially from those currently anticipated due to a number of factors, including the risks discussed in the Company’s most recent filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K and Quarterly Report on Form 10-Q for the period ended June 30, 2020. The Company expressly disclaims any responsibility to update or revise forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
| Item 9.01 | Financial Statements and Exhibits |
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| (d) | Exhibits |
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The following exhibits are being furnished herewith:
| 99.1 | Press Release issued August 4, 2020. |
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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.
| Modine Manufacturing Company | ||
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| By: /s/ Sylvia A. Stein | ||
| Sylvia A. Stein<br><br> Vice President, General Counsel and Corporate Secretary | ||
| Date: August 4, 2020 |
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Exhibit 99.1
NEWS RELEASE
FOR IMMEDIATE RELEASE
Modine Announces CEO Transition Plan
Michael B. (Mick) Lucareli appointed Interim President and Chief Executive Officer; Board currently executing search process for new leader to drive the industrial strategy and accelerate future growth
Racine, WI – August 4, 2020 – Modine Manufacturing Company (NYSE: MOD), a diversified global leader in thermal management technology and solutions, announced today that Modine’s Board of Directors has launched a search for a new President and Chief Executive Officer and Thomas A. Burke will be stepping down from both his position as President and Chief Executive Officer and as a member of Modine’s Board of Directors, effective immediately. The Board has named Mick Lucareli, the Company’s Vice President Finance and Chief Financial Officer, as Interim President and Chief Executive Officer, effective today. Mr. Burke will remain with the Company in a senior advisory role until August 28, 2020, to ensure a smooth transition.
“I am honored to have served as Modine’s President and Chief Executive Officer,” said Burke. “I would like to thank the entire Modine team. It has been a privilege to work with all of the Modine employees for the past fifteen years. I believe we have done tremendous work together, including transforming the business to be a more diversified thermal management solutions provider. Modine has a bright future and I look forward to seeing its continued success.“
Marsha Williams, Lead Director of Modine’s Board of Directors added, “On behalf of the entire Board of Directors, I would like to thank Tom for his more than fifteen years of service with Modine and his more than twelve years as our President and CEO. Tom accepted the CEO position in the midst of the 2008-2009 financial crisis and acted with a sense of urgency to fortify Modine’s operations and ensure that the Company weathered the economic downturn.”
Williams continued, “In 2015, Tom launched our transformational, Strengthen, Diversify and Grow (SDG) strategy. That platform gained Modine a foothold in new, growing markets and resulted in the acquisition of Luvata HTS in 2016. The addition of Luvata’s industrial-based portfolio of products significantly diversified our technological capabilities and customer mix, while making Modine a global leader in coils and coatings. Lastly, Tom has been instrumental in leading Modine through the COVID-19 crisis and has positioned the business to emerge stronger. Tom has made an indelible mark on Modine’s rich history of innovation that spans more than a century and we are grateful for his historical leadership.”
Williams added, “As Modine works to complete the divestiture of its legacy Automotive business and further pivots towards its long-term vision to become a true industrial thermal management solutions provider, we have reached a natural inflection point. Now is the right time to find a new leader that can drive our industrial transformation strategy, while accelerating the Company’s future growth. A global search is underway to help us find that leader. The Board has extreme confidence that Mick and our experienced senior leadership team will continue to execute against our strategic vision until that leader is in place.”
Mick Lucareli concluded, “I would also like to thank Tom for his mentorship and leadership over the fifteen years I have worked with him at Modine. I strongly believe in the future of Modine and its vision of being a stronger, more diversified thermal management company. I remain committed to this strategy and am honored to lead this effort during the current transition period.”
About Michael B. (Mick) Lucareli
Michael B. (Mick) Lucareli was named Vice President, Finance, and Chief Financial Officer on July 12, 2010. He leads Modine’s global finance, information technology and corporate strategy functions. Mr. Lucareli joined Modine in August 1999 and has held a variety of leadership roles, including Manager, Business Development and Investor Relations; Director, Financial Operations and Analysis; Managing Director, Financial Operations; and Vice President, Corporate Treasurer. Before joining Modine, Mr. Lucareli was Director of Research at Alpha Investments Group and a securities analyst and portfolio manager at Associated Investment Management Group. Mr. Lucareli earned a bachelor’s degree in economics from the University of Wisconsin - Madison and a Master of Business Administration (MBA) from Loyola University in Chicago. He also holds a Chartered Financial Analyst (CFA) designation.
About Modine
Modine, with fiscal 2020 revenues of $2.0 billion, specializes in thermal management systems and components, bringing highly engineered heating and cooling components, original equipment products, and systems to diversified global markets through its four complementary segments: CIS; BHVAC; HDE; and Automotive. Modine is a global company headquartered in Racine, Wisconsin (USA), with operations in North America, South America, Europe and Asia. For more information about Modine, visit www.modine.com.
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Forward-Looking Statements
This press release contains statements, including information about future financial performance and market conditions, accompanied by phrases such as “believes,” “estimates,” “expects,” “plans,” “anticipates,” “intends,” and other similar “forward-looking” statements, as defined in the Private Securities Litigation Reform Act of 1995. Modine’s actual results, performance or achievements may differ materially from those expressed or implied in these statements because of certain risks and uncertainties, including, but not limited to those described under “Risk Factors” in Item 1A of Part I of the Company’s Annual Report on Form 10-K for the year ended March 31, 2020 and under Forward-Looking Statements in Item 7 of Part II of that same report as well as the Company’s other filings with the U.S. Securities and Exchange Commission. Other risks and uncertainties include, but are not limited to, the following: the impact of the COVID-19 pandemic on the national and global economy, our business, suppliers, customers, and employees; the overall health and price-down focus of Modine’s customers; our ability to successfully execute our strategic and operational plans, including our ability to successfully exit the automotive business; our ability to effectively and efficiently reduce our cost structure in response to sales volume declines and complete restructuring activities and realize benefits thereon; our ability to comply with the financial covenants in our credit agreements and to fund our global liquidity requirements efficiently, particularly in light of the volatility and negative impacts to the financial markets resulting from COVID-19; operational inefficiencies as a result of program launches, unexpected volume increases, product transfers, and delays or inefficiencies resulting from restrictions imposed in response to the COVID-19 pandemic; economic, social and political conditions, changes and challenges in the markets where Modine operates and competes, including foreign currency exchange rate fluctuations, tariffs (and potential trade war impacts resulting from tariffs or retaliatory actions), inflation, changes in interest rates or tightening of the credit markets, recession, restrictions associated with importing and exporting and foreign ownership, public health crises, and the general uncertainties about the impact of regulatory and/or policy changes, including those related to tax and trade, the COVID-19 pandemic and other matters, that have been or may be implemented in the U.S. or abroad, and continuing uncertainty regarding the impacts of “Brexit”; the impact on Modine of any significant increases in commodity prices, particularly aluminum, copper, steel and stainless steel (nickel) and other purchased component inventory, and our ability to adjust product pricing in response to any such increases; the nature of and Modine’s significant exposure to the vehicular industry and the dependence of this industry on the health of the economy; the concentration of sales within our CIS segment attributed to one customer; Modine’s ability to recruit and maintain talent in managerial, leadership, and administrative functions; Modine’s ability to protect its proprietary information and intellectual property from theft or attack; the impact of any substantial disruption or material breach of our information technology systems; costs and other effects of environmental investigation, remediation or litigation; and other risks and uncertainties identified by the Company in public filings with the U.S. Securities and Exchange Commission. Forward-looking statements are as of the date of this release, and the Company does not assume any obligation to update any forward-looking statements.
| SOURCE: Modine Manufacturing Company |
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| Kathleen Powers |
| (262) 636-1687 |
| kathleen.t.powers@modine.com |
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