UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
Current Report
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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
On March 10, 2021, the Compensation Committee (the “Committee”) of the Board of Directors of Allied Motion Technologies Inc. approved certain revisions to the Company’s compensation program for 2021.
LTIP Sales Target. The Long-Term Incentive Plan (LTIP) is a multi-year pay-for-performance incentive program under which the Chief Executive Officer, Chief Financial Officer and President, Allied Innovum Group will earn restricted stock awards based upon the achievement of an increase in sales during various performance periods through December 31, 2022. The LTIP was first implemented in 2013 and has been revised and extended as performance goals were achieved. On March 10, 2021, the Compensation Committee reduced the sales target to be achieved to earn all restricted share awards available from $500 million to $450 million (the “LTIP Sales Target”). The LTIP Sales Target was reduced to take account of adverse impacts on the Company’s growth in 2020 resulting from the global COVID-19 pandemic. The LTIP Sales Target can be achieved in two ways—organic sales growth and acquired sales (defined as the actual sales achieved by any company or business unit acquired by Allied Motion for the trailing twelve months immediately preceding the closing date of such acquisition). Under the original terms of the LTIP, for each $30 million increase in sales up to the LTIP Sales Target, each executive earns restricted stock awards equal to a percentage of his annual salary at the beginning of the performance period. Since the program expires in 2022, the Company will need to achieve approximately $50 million of growth each year for participants to earn the maximum award. Other than the revision to the LTIP Sales Target, the terms and conditions of the LTIP were unchanged and remain in full force and effect.
ROE Incentive Plan. Previously, Richard S. Warzala, the Company’s Chair and Chief Executive Officer, was granted an incentive award with a performance target based on the Company’s return on equity. If the ROE Incentive Plan target was achieved, an amount equal to 12.5% of the excess over the ROE Incentive Plan target was paid to Mr. Warzala as incentive compensation, with a cap of an amount equal to Mr. Warzala’s base compensation. The Committee eliminated the ROE Incentive Plan for 2021. The Committee made the change to align the metrics used to determine incentive compensation for the Company’s Named Executive Officers and increased Mr. Warzala’s target incentives under other incentive compensation plans (see below).
Adjustment of CEO Target Incentives. In connection with the elimination of the ROE Incentive Plan, the Committee revised Mr. Warzala’s target incentives (as a percentage of base salary) under the Company’s Annual Cash Incentive; Performance Share Plan; Time-Based Awards for 2021 as follows:
|
Element of Compensation |
2020 Target
as Percentage |
2021 Target
as Percentage | ||
| ROE Incentive Plan | 100% | 0% | ||
| Annual Cash Incentive | 75% | 125% | ||
| Performance Share Plan | 50% | 62.5% | ||
| Time-Based Awards | 50% | `62.5% |
Item 9.01. Financial Statements and Exhibits.
104 Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101).
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: March 16, 2021
| ALLIED MOTION TECHNOLOGIES INC. | ||
| By: | /s/ Michael R. Leach | |
| Michael R. Leach | ||
| Chief Financial Officer | ||