8-K

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 Exchange act of 1934

Date of Report (Date of earliest event reported):

August 14, 2020

PLANTRONICS, INC.

(Exact name of Registrant as Specified in its Charter)

Delaware	1-12696	77-0207692
(State or Other Jurisdiction of Incorporation)	(Commission file number)	(I.R.S. Employer Identification No.)

345 Encinal Street

Santa Cruz, California 95060

(Address of Principal Executive Offices including Zip Code)

(831) 426-5858

(Registrant's Telephone Number, Including Area Code)

Not Applicable

(Former name or former address, if changed since last report)

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)

 

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 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))

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, $0.01 PAR VALUE	PLT	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 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. o

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Appointment of President, Chief Executive Officer and Member of the Board

On August 17, 2020 Plantronics, Inc. (“Poly” or the “Company”) announced the appointment of Dave Shull as President, Chief Executive Officer and a member of the Company’s Board of Directors (the “Board”), effective September 8, 2020. Mr. Shull succeeds Robert Hagerty, who has served as Interim Chief Executive Officer since February 2020. Mr. Hagerty will continue in his role as Chairman of the Board and resume his membership on the Nominating and Governance and Strategy Committees, as well as his role as Chair of the Mergers and Acquisitions Committee. Marv Tseu will step down as Lead Independent Director and continue in his role as Vice Chairman of the Board.

Mr. Shull, age 47, served as President and Chief Executive Officer and as a member of the board of TiVo Corporation from May 2019 until its merger of equals transaction with Xperi Corporation in June 2020. Previously he served as Chief Executive Officer of The Weather Channel cable network from January 2016 until its sale in September 2018 and served as Group President, TV of The Weather Channel group from May 2015 to January 2016. Prior to The Weather Channel, Mr. Shull held various executive roles from October 2004 to May 2014 at DISH Network and EchoStar, including Executive Vice President and Chief Commercial Officer, Senior Vice President, Programming, Senior Vice President and Managing Director, Asia Pacific, and Vice President, Operations. Mr. Shull received a A.B. in philosophy from Harvard University and an M.B.A. from Oxford University.

Offer Letter

In connection with his appointment as President and Chief Executive Officer, the Company and Mr. Shull entered into an offer (the “Offer Letter”) dated August 15, 2020. Pursuant to the terms of the Offer Letter, Mr. Shull will be appointed to serve as a member of the Board effective as of his employment start date. Thereafter, at each annual meeting of the Company’s stockholders while Mr. Shull serves as the Company’s President and Chief Executive Officer and upon which his term as a Board member is scheduled to expire, the Company will nominate him to serve as a member of the Board, subject to any required stockholder approval. Under the terms of the Offer Letter, Mr. Shull will receive an annual base salary of $800,000 and will be eligible under the Company’s Annual Incentive Plan to receive an annual bonus award targeted at 125% of Mr. Shull’s annual base salary, with a maximum bonus opportunity of 200% of Mr. Shull’s annual base salary for outstanding performance, commencing with the Company’s 2021 fiscal year with any 2021 bonus subject to pro-ration based on Mr. Shull’s start date. Mr. Shull will receive a $500,000 signing bonus which will be paid on his first paycheck following his start date.

In addition, it will be recommended to the Board or a sub-committee of the Board that Mr. Shull receive an award of 75,000 restricted stock units (“RSUs”) to be awarded on the 15th day of the month following the month in which Mr. Shull’s start date occurs (the “Grant Date”), under a Company-sponsored equity incentive plan (the “Stock Plan”). If approved, the RSUs will vest in three equal annual installments on the first, second and third anniversaries of the Grant Date, in each case subject to Mr. Shull’s continued employment with the Company on each applicable vesting date. Additionally, it will be recommended to the Board or a sub-committee of the Board that Mr. Shull receive an award of 250,000 performance stock unit awards (“PSUs”) on the Grant Date and under the Stock Plan. The performance period for the PSUs will be aligned to the Company’s 2021 fiscal year for performance-based RSUs (the “PSU Plan”). The PSUs will vest in accordance with the terms of the PSU Plan, subject to Mr. Shull’s continued employment with the Company through the applicable vesting date. The performance period for the PSUs will begin on the first day of the Company’s 2021 fiscal year and will end on the last day of the Company’s 2023 fiscal year. The number of PSUs eligible to vest (or “eligible PSUs”) will be determined proportionally at the end of the Company’s 2021, 2022 and 2023 fiscal years, and the number of eligible PSUs will be based on the Company’s total stockholder return as compared to the stockholder return of the companies listed in the iShares S&P North American Tech-Multimedia Networking Index (the “Index”) to calculate a growth rate delta (the “Growth Rate Delta”) equal to the Company’s total stockholder return minus the total stockholder return for the companies listed in the Index.

Change of Control Severance Agreement

Mr. Shull and the Company entered into a Change of Control Severance Agreement (the “Severance Agreement”), to become effective as of September 9, 2020 (the “Effective Date”). The Severance Agreement has an initial term beginning on the Effective Date and ending on March 31, 2023, with automatic renewals for additional one-year terms, unless the Company provides notice of non-renewal at least 60 days prior to the date of automatic renewal. If Mr. Shull becomes entitled to benefits pursuant to the terms of the Severance Agreement, the Severance Agreement will not terminate until all obligations of the parties under the Severance Agreement have been satisfied.

If the Company terminates Mr. Shull’s employment without Cause (as defined in the Severance Agreement) or if Mr. Shull resigns for Good Reason (as defined in the Severance Agreement) (such termination, a “Qualifying Termination”), and the Qualifying Termination does not occur during the 24-month period on or following the first Change of Control (as defined in the Severance Agreement) to occur following the Effective Date (the “Change of Control Period”), then subject to Mr. Shull signing and not revoking a release of claims with the Company and subject to Mr. Shull’s continued compliance with the terms of the Severance Agreement, Mr. Shull will receive the following:

• Continuing payments of severance pay at a rate equal to Mr. Shull’s then-current base salary for a period of 24 months;

• A lump sum cash payment equal to 200% of Mr. Shull’s target bonus for the fiscal year in which the Qualifying Termination occurs or if his target bonus opportunity has not yet been established for the fiscal year in which the Qualifying Termination occurs, the prior fiscal year’s target bonus;

• A lump sum cash payment in an amount equal to the monthly COBRA premium that Mr. Shull would be required to pay to continue his group health coverage as in effect on the date of his termination for himself and his eligible dependents, multiplied by 18, which payment will be made regardless of whether Mr. Shull elects COBRA continuation coverage; and

• 18 months’ outplace assistance.

In the event a Qualifying Termination occurs during the Change of Control Period, then subject to Mr. Shull signing and not revoking a release of claims with the Company and subject to Mr. Shull’s continued compliance with the terms of the Severance Agreement, Mr. Shull will receive the following:

• A lump sum cash payment equal to the sum of (i) 200% of Mr. Shull’s then-current annual base salary (or, if greater, at the level in effect immediately prior to the Change of Control); plus (ii) 200% of Mr. Shull’s target bonus as in effect for the fiscal year in which the Qualifying Termination occurs (or, if greater, the target bonus as in effect for the fiscal year in which the Change of Control occurs; plus (iii) a pro-rated portion of Mr. Shull’s annual incentive bonus that has been accrued but not paid as of the Qualifying Termination;

• Mr. Shull’s equity awards subject to time-based vesting will vest in full as to 100% of the shares subject to the awards and for equity award subject to performance-based vesting, all performance goals and other vesting criteria will be treated as provided in the equity agreement governing the award;

• A lump sum cash payment in an amount equal to the monthly COBRA premium that Mr. Shull would be required to pay to continue his group health coverage as in effect on the date of his termination for himself and his eligible dependents, multiplied by 24, which payment will be made regardless of whether Mr. Shull elects COBRA continuation coverage; and

• 24 months’ outplace assistance.

All payments and benefits described above are subject to required tax withholding.

There are no arrangements or understandings between Mr. Shull and any other persons pursuant to which he was named to this position with the Company. Mr. Shull does not have any family relationship with any of the Company’s directors or executive officers or any persons nominated or chosen by the Company to be a director or executive officer. He has no direct or indirect material interest in any transaction or proposed transaction required to be reported under Section 404(a) of Regulation S-K or Item 5.02(c) of Form 8-K.

A copy of the press release regarding these announcements is attached to this Form 8-K as Exhibit 99.1.

Mutual Transition of Executive Vice President, Chief Legal and Compliance Officer and Corporate Secretary

Mary Huser and the Company have mutually agreed to transition her responsibilities as the Company’s Executive Vice President, Chief Legal and Compliance Officer and Corporate Secretary. On August 14, 2020 (the “Separation Date”), Ms. Huser’s employment with the Company terminated.

Ms. Huser and the Company have entered into a letter agreement (the “Letter Agreement”) that provides for a release of all claims between Ms. Huser and the Company and contains standard confidentiality, non-disparagement and cooperation provisions.

As consideration for entering into and not revoking the Letter Agreement, the Company will pay or provide Ms. Huser the following:

• A lump sum cash payment equal to $442,520, payable on the first Company payroll date following the completion of the revocation period contained in the Letter Agreement;

• Provided Ms. Huser timely elects and remains eligible for COBRA continuation coverage, Company payment of COBRA continuation coverage for 12 months following the Separation Date; and

• 12 months of standard outplacement services, payable to the provider and not payable in cash to Ms. Huser, provided it is initiated by her within 3 months of signing the Letter Agreement.

All payments and benefits described above are subject to required tax withholding.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

Exhibit Number	Description
99.1	Press release issued by Plantronics, Inc. on August 17, 2020, entitled "Poly Appoints Dave Shull President and Chief Executive Officer"
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURE

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:	August 18, 2020	PLANTRONICS, INC.
		By:	/s/ Charles D. Boynton
		Name:	Charles D. Boynton
		Title:	Executive Vice President and Chief Financial Officer

EX-99.1

FOR IMMEDIATE RELEASE

Poly Appoints Dave Shull President and Chief Executive Officer

Telecommunications and Technology Veteran Brings 15 Years of Senior Leadership Experience and a Strong Track Record of Value Creation

SANTA CRUZ, Calif., - August 17, 2020 - Plantronics, Inc. (NYSE: PLT) ("Poly" or the "Company"), a global communications company that powers meaningful human connection and collaboration, today announced the appointment of Dave Shull as President, Chief Executive Officer and a member of the Company’s Board of Directors (the “Board”), effective September 8, 2020. Mr. Shull succeeds Robert Hagerty, who has served as Interim Chief Executive Officer since February 2020. Mr. Hagerty will continue in his role as Chairman of the Board, and resume his membership on the Nominating and Governance and Strategy Committees, as well as his role as Chair of the Mergers and Acquisitions Committee. Marv Tseu will continue in his role as Vice Chairman of the Board.

“Dave is a technology veteran whose global operations and telecommunications expertise, together with his extensive leadership experience and fresh insights, make him an outstanding leader for Poly,” said Mr. Hagerty. “Poly’s rich technology history, diverse end markets ranging from offices and call centers to consumers, and proven focus on excellence in innovation mean that we have a tremendous opportunity ahead of us. The addition of an enthusiastic, creative thinker like Dave is, in the Board’s view, a recipe for long-term success and growth. On behalf of the Board, I am pleased to welcome Dave to the Poly family.”

“The COVID-19 pandemic has changed the world for all of us - especially how we interact and connect with others, both professionally and personally,” said Mr. Shull. “Poly has been leading the world for decades in connecting teams wherever and however they want. Its world-class audio, video, and software engineers are focused on creating the best communication endpoints that sound great and deliver amazing video, and are also consistently reliable and manageable for the most demanding users. We expect the fundamental shift to remote work and to the cloud will endure well beyond the pandemic, and the market opportunities created by the work-from-anywhere revolution are significant and exciting. This is a pivotal time in Poly’s history, and I am excited to lead this talented team during this transformational period.”

About Dave Shull

Mr. Shull most recently served as President and CEO of TiVo Corporation, where he gained significant consumer hardware experience and reinvigorated the image of the TiVo brand through a new corporate narrative and a cutting-edge streaming product. Under Mr. Shull’s leadership, TiVo’s adjusted EBITDA grew 55% from Q1 2019 to Q2 2020. Prior to leading TiVo, he served as CEO of The Weather Channel. Mr. Shull brings over 15 years of senior leadership experience in digital media, commercial marketing, operations, and telecommunications. He also brings extensive global experience in operational transformation, complex business partnerships, corporate development and capital markets. Prior to serving as CEO of The Weather Channel, he held various executive roles at DISH Network/EchoStar for 10 years, including Executive Vice President and Chief Commercial Officer, Senior Vice President, Programming, Senior Vice President and Managing Director, Asia Pacific, and Vice President, Operations. Mr. Shull holds an A.B. from Harvard University and an M.B.A. from Oxford University.

-1-

About Poly

Plantronics, Inc. ("Poly" - formerly Plantronics and Polycom) (NYSE: PLT) is a global communications company that powers meaningful human connection and collaboration. Poly combines legendary audio expertise and powerful video and conferencing capabilities to overcome the distractions, complexity and distance that make communication in and out of the workplace challenging. Poly believes in solutions that make life easier when they work together and with our partners' services. Our headsets, software, desk phones, audio and video conferencing, analytics and services are used worldwide and are a leading choice for every kind of workspace. For more information visit www.Poly.com.

Poly, the propeller design, and the Poly logo are trademarks of Plantronics, Inc. All other trademarks are the property of their respective owners.

Forward Looking Statements Safe Harbor

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including quotations of management and statements relating to our intentions, beliefs, projections, outlook, analyses or current expectations that are subject to many risks and uncertainties. Such forward-looking statements and the associated risks and uncertainties include, but are not limited to: (i) our beliefs with respect to the length and severity of the COVID-19 (coronavirus) outbreak, and its impact across our businesses, our operations and global supply chain, including (a) our inability to source component parts from key suppliers in sufficient quantities necessary to meet the high demand for certain product lines, including our Enterprise Headsets, which negatively impacted our sales during the quarter; and continued uncertainty and potential impact on future quarters if these sourcing constraints continue and/or price volatility occurs, which could continue to negatively affect our profitability and/or market share, (b) our expectations that the virus has caused and will continue to cause, an increase in customer and partner demand, including increased demand in collaboration endpoints due to a global, work from home workforce, (c) expectations related to our voice product lines, as well as our services attachment rate for such products, which have been, and may continue to be, negatively impacted as companies have delayed returning their workforces to offices in many countries due to uncertainties related to the continued impact of COVID-19; (d) expectations related to our ability to fulfill the backlog generated by supply constraints during the quarter, to timely supply the number of products to fulfill current and future customer demand, including expectations that our manufacturing facility in Tijuana, Mexico will continue production at the capacity necessary to meet such demand, (e) the impact of the virus on our distribution partners, resellers, end-user customers and our production facilities, including our ability to obtain alternative sources of supply if our production facility or other suppliers are impacted by future shut downs, (f) the impact if global or regional economic conditions deteriorate further, on our customers and/or partners, including increased demand for pricing accommodations, delayed payments, delayed deployment plans, insolvency or other issues which may increase credit losses, and (g) risks related to restrictions or delays in global return to worksites as a result of COVID-19, which continues to impact our employees worldwide and our customers, which has negatively impacted our voice product lines for the quarter, and restricted customer engagement; and (h) the complexity of the forecast analysis and the design and operation of internal controls; and (ii) our belief that we can manufacture or supply products in a timely manner to satisfy perishable demand; (iii) expectations related to our customers’ purchasing decisions and our ability to match product production to demand, particularly given long lead times and the difficulty of forecasting unit volumes and acquiring the component parts and materials to meet demand without having excess inventory or incurring cancellation charges; (iv) risks associated with significant and abrupt changes in product demand which increases the complexity of management’s evaluation of potential excess or obsolete inventory; (v) risks associated with the bankruptcy or financial weakness of distributors or key customers, or the bankruptcy of or reduction in capacity of our key suppliers; (vi) risks associated with the potential interruption in the supply of sole-sourced critical

-2-

components, our ability to move to a dual-source model, and the continuity of component supply at costs consistent with our plans, which has negatively impacted in the quarter and may continue to impact our ability to timely supply product to meet our customer demand; (vii) expectations related to our services segment revenues, particularly as we introduce new generation, less complex, product solutions, or as companies shift from on premises to work from home options for their workforce, which may result in decreased demand for our professional, installation and/or managed service offerings; (viii) expectations that our current cash on hand, additional cash generated from operations, together with sources of cash through our credit facility, either alone or in combination with our election to suspend our dividend payments, will meet our liquidity needs during and following the unknown duration and impact of the COVID-19 pandemic; (ix) expectations relating to our ability to generate sufficient cash flow from operations to meet our debt covenants and timely repay all principal and interest amounts drawn under our credit facility as they become due; (x) risks associated with our channel partners’ sales reporting, product inventories and product sell through since we sell a significant amount of products to channel partners who maintain their own inventory of our products; (xi) our efforts to execute to drive sales and sustainable profitable revenue growth; (xii) our expectations for new products launches, the timing of their releases and their expected impact on future growth and on our existing products; (xiii) our belief that our new Partner Program will drive growth and profitability for both us and our partners through the sale of our product, services and solutions; (xiv) risks associated with forecasting sales and procurement demands, which are inherently difficult, particularly with continuing uncertainty in regional and global economic conditions; (xv) uncertainties attributable to currency fluctuations, including fluctuations in foreign exchange rates and/or new or greater tariffs on our products; (xvi) our expectations regarding our ability to control costs, streamline operations and successfully implement our various cost-reduction activities and realize anticipated cost savings under such cost-reduction initiatives; (xvii) expectations relating to our quarterly and annual earnings guidance, particularly as economic uncertainty, including, without limitation, uncertainty related to the continued impact of COVID-19, the macro-economic and political climate and other external factors, puts further pressure on management judgments used to develop forward looking financial guidance and other prospective financial information; (xviii) expectations related to GAAP and non-GAAP financial results for the second quarter and full Fiscal Year 2021, including net revenues, adjusted EBITDA, tax rates, intangibles amortization, diluted weighted average shares outstanding and diluted EPS; (xix) our expectations of the impact of the acquisition of Polycom as it relates to our strategic vision and additional market and strategic partnership opportunities for our combined hardware, software and services offerings; (xx) our beliefs regarding the UC&C market, market dynamics and opportunities, and customer and partner behavior as well as our position in the market, including risks associated with the potential failure of our UC&C solutions to be adopted with the breadth and speed we anticipate; (xxi) our belief that the increased adoption of certain technologies and our open architecture approach has and will continue to increase demand for our solutions; (xxii) expectations related to the micro and macro-economic conditions in our domestic and international markets and their impact on our future business; (xxiii) our forecast and estimates with respect to tax matters, including expectations with respect to utilizing our deferred tax assets; (xxiv) our expectations related to building strategic alliances and key partnerships with providers of collaboration tools and platforms to drive revenue growth and market share; and (xxv) our expectations regarding pending and potential future litigation, in addition to other matters discussed in this press release that are not purely historical data. Such forward-looking statements are based on current expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ materially from the forward-looking statements.

We do not assume any obligation to update or revise any such forward-looking statements, whether as the result of new developments or otherwise.

-3-

For more information concerning these and other possible risks, please refer to our Annual Report on Form 10-K filed with the Securities and Exchange Commission on June 8, 2020, our Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on July 29, 2020, and other filings with the Securities and Exchange Commission, as well as recent press releases.

INVESTOR CONTACT:

Mike Iburg

Vice President, Investor Relations

(831) 458-7533

MEDIA CONTACT:

Edie Kissko

Senior Director, Corporate Communications

(213) 369-3719

-4-

XML

Cover Page	Aug. 14, 2020
Cover [Abstract]
Document Type	8-K
Document Period End Date	Aug. 14, 2020
Entity Registrant Name	PLANTRONICS INC
Entity Central Index Key	0000914025
Amendment Flag	false
Entity Incorporation, State or Country Code	DE
Entity File Number	1-12696
Entity Tax Identification Number	77-0207692
Entity Address, Address Line One	345 Encinal Street
Entity Address, City or Town	Santa Cruz
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	95060
City Area Code	831
Local Phone Number	426-5858
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	COMMON STOCK, $0.01 PAR VALUE
Trading Symbol	PLT
Security Exchange Name	NYSE
Entity Emerging Growth Company	false