form8k.htm
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities and Exchange Act of 1934
Date of
Report (Date of earliest event reported): February 28,
2008
NALCO
HOLDING COMPANY
(Exact
name of registrant as specified in its charter)
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Delaware
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001-32342
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16-1701300
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(State
of Incorporation)
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(Commission
File Number)
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(IRS
Employer Identification Number)
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1601 W.
Diehl Rd., Naperville, IL 60563
630-305-1000
Check the
appropriate box below if the Form 8-K is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following
provisions:
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o
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240
240.14a-12)
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o
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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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o
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
1.01
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Entry into a Material
Definitive Agreement
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Nalco Holding Company (the “Company”) entered into an
Employment Letter Agreement dated as of February 21, 2008 and a Severance
Agreement effective as of February 28, 2008 with J. Erik Fyrwald relating to the
hiring of Mr. Fyrwald as Chief Executive Officer and President. Copies of the
Agreements are filed with this report as Exhibits 99.1 and 99.2, respectively.
The material terms and conditions of the Agreements are summarized in Item 5.02
below.
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Item
5.02 (c)
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Departure of Directors
or Certain Officers; Election of Directors; Appointment of Certain
Officers; Compensatory Arrangements of Certain
Officers.
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Effective
as of February 28, 2008, the Board of Directors appointed J. Erik Fyrwald, 48,
as Chairman, Chief Executive Officer and President of the Company, Nalco Finance
Holdings LLC, Nalco Holdings LLC and Nalco Company. The press release announcing
Mr. Fyrwald’s election is filed with this report as Exhibit 99.3. Rodney F.
Chase, who has served as the Company’s Interim Chairman of the Board of
Directors, will continue to serve as a Director of the Company.
As
described in the press release, since 2003, Mr. Fyrwald had been Group Vice
President of the $6.8 billion Agriculture and Nutrition division at E.I. DuPont
De Nemours & Company. Before that, Mr. Fyrwald was Vice President and
General Manager of DuPont’s Nutrition and Health business from
2000.
Under the terms of the Employment Letter Agreement, Mr.
Fyrwald was elected the Chairman, President and Chief Executive Officer of the
Company. The material terms and conditions of the Employment Letter Agreement
and the Severance Agreement are summarized below, which descriptions are
qualified in their entirety by reference to the terms and conditions of the
Agreements. Capitalized terms used in this report are as defined in the
Agreements.
Base Salary
Mr.
Fyrwald will receive an annual base salary of $850,000.
Annual Incentive Plan under the Company’s Management
Incentive Plan
Mr. Fyrwald will be eligible to participate in the
Company’s Management Incentive Plan (“MIP”). Under the MIP, his annual bonus
will have a target amount of 100% of his base salary, with the actual bonus
having a range of 0% to 200% of his base salary based on actual performance in
accordance with the terms of the MIP.
Stock Awards
The Company intends to grant Mr. Fyrwald stock awards
under the Company’s 2004 Stock Incentive Plan (the “Plan”) and stock awards
outside the Plan. Subject to the terms of the Plan, the Company intends to grant
Mr. Fyrwald (i) 225,000 ten-year non-qualified stock options that vest in 4
equal installments at the end of 2008 and the end of each of the following three
years, (ii) 75,000 performance shares that vest on December 31, 2010 subject to
the achievement of certain performance criteria over the performance period for
the cycle 2008-2010 and Mr. Fyrwald’s continued employment through December 31,
2010 and (iii) 50,000 performance shares that vest on December 31, 2010 subject
to the achievement of certain performance criteria for 2008 and Mr. Fyrwald’s
continued employment through 2010. In addition, the Company intends
to grant Mr. Fyrwald certain inducement awards outside the Plan. In accordance
with New York Stock Exchange Rule 303A(8), these non-Plan awards will be granted
without stockholder approval. Mr. Fyrwald’s non-Plan inducement awards are
anticipated to be as follows: (i) 150,000 ten-year non-qualified
stock options that vest 50% on each of the third and fourth anniversaries of the
date of grant and (ii) 200,000 restricted shares that vest 50% on each of the
third and fourth anniversaries of the date of grant. The Plan and non-Plan stock
awards are expected to be made on March 7, 2008. To the extent the terms of the
Plan cause the number of stock awards that may be granted to Mr. Fyrwald to be
less than those described above, the Company intends to issue a corresponding
number of stock awards to Mr. Fyrwald outside the Plan as additional inducement
awards.
Severance
Upon Mr. Fyrwald’s involuntary termination without Cause
or voluntary termination for Good Reason, Mr. Fyrwald’s severance benefits under
the Severance Agreement will include:
(i) full vesting of all non-Plan inducement stock
awards;
(ii) a severance payment equal to two times the sum of
Mr. Fyrwald’s then-current base salary plus his then-current target bonus amount
under the MIP;
(iii) continued participation for eighteen months in the
Company’s medical and dental plans at active employee rate(s);
and
(iv) a pro rata bonus under the MIP for the termination
year based on actual performance for the year.
Change of Control
In the event Mr. Fyrwald’s employment with the Company is terminated by the Company without
Cause or by Mr. Fyrwald for Good Reason following a Change of Control, then Mr.
Fyrwald will, under certain circumstances, be entitled to a Gross-Up Payment to
the extent any payments to him under his Employment Letter Agreement or
Severance Agreement result in an exercise tax under Sections 280G and 4999 of
the Internal Revenue Code.
Confidential Information, Nonsolicitation,
Noncompetition
Mr. Fyrwald will comply with various covenants
prohibiting disclosure of confidential information, solicitation of customers
and employees, and engaging in competitive activity.
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Item
9.01.
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Financial Statements
and Exhibits
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The
following exhibits are furnished pursuant to Item 9.01 of Form 8-K:
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Press
Release announcing the appointment of J. Erik Fyrwald as Chairman, Chief
Executive Officer and President.
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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.
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NALCO
HOLDING COMPANY
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/s/
Stephen N. Landsman
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Secretary
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Date:
February 28, 2008