Summary
Flex Ltd. (FLEX) has filed an 8-K report detailing the retirement of its Chief Executive Officer, Michael M. McNamara, effective December 31, 2018. This filing outlines the terms of his separation agreement, which includes a lump sum payment, accelerated vesting of certain RSUs, and continued health insurance coverage. The company has been actively searching for a successor, considering both internal and external candidates, under the guidance of Chairman Michael D. Capellas. Investors should note the financial implications of the separation agreement, particularly the cash payout and equity acceleration, which are subject to customary clawback provisions. The departure marks a significant leadership transition for Flex Ltd. as it seeks new executive leadership.
Key Highlights
- 1Michael M. McNamara will retire as CEO on December 31, 2018, and resign from the Board of Directors.
- 2Mr. McNamara will receive a separation payment of $1,250,000 (12 months' base salary).
- 3347,985 time-vesting RSUs that would have vested in 2019 will be accelerated.
- 4Flex will provide Mr. McNamara with group health insurance coverage at the company's expense until he turns 65.
- 5The separation agreement includes customary non-disclosure, non-disparagement, and cooperation provisions with clawback rights for the company.
- 6Performance-based RSUs (PSUs) will vest on a pro-rata basis according to performance criteria, subject to clawback.
- 7Mr. McNamara will forfeit unvested Elementum profits interests and other unvested equity awards.