18th Feb 2008 16:00
Danka Business Systems PLC18 February 2008 For Immediate Release 18 February 2008 Danka Business Systems PLC ("Danka" or "the Company") Danka Enters into Long Term Incentive Plan, Amends Change of Control Service Agreement with CEO and Chairman A.D. Frazier On February 15, 2008, Danka Business Systems PLC (the "Company") entered in to aLong Term Incentive Plan (the "Plan") with A.D. Frazier (the "Executive") , itsChief Executive Officer, effective January 1, 2008. The Plan will be anunsecured, unfunded general obligation of the Company. The Plan is intended to provide a cash-based incentive opportunity (the"Incentive Award") to the Executive upon attainment of the Annual OperatingIncome Targets (as specified in the Company's five-year plan) for fiveconsecutive calendar year periods (the "Plan Term"), beginning on January 1,2008 (the "Plan Effective Date"). The Plan provides for a maximum annual creditin the amount of $825,000 per annual award period, subject to the attainment ofthe Annual Operating Income Targets for that award period, with a maximumaggregate five-year payout at the end of the Plan Term of $4,125,000. The AnnualOperating Income Targets may be achieved on a cumulative basis. At the end ofthe Plan Term or, if earlier, the time that the Executive's employment isterminated for certain reasons (described below) prior to the end of the PlanTerm, the Executive will be entitled to receive the Incentive Award based on thefollowing terms: • At the end of the Plan Term, provided that the Executive remains employed until such time: 100% of amounts credited to the Executive during the Plan Term. • Upon termination prior to the end of the Plan Term for "Good Reason" or for other than "Cause" (as those terms are defined in the Agreement), the Executive will be entitled to the following: The sum of (1) and (2), but in no event less than $412,500: (1) For completed award periods: The amounts credited to the Executive for the completed award periods as of his date of termination, multiplied by the product of 20% and the number of completed award periods; and (2) For the ongoing award period: 20% of $825,000, then prorated for the incomplete year by multiplying this amount by a fraction, the numerator of which is the number of completed months from the beginning of the award period until the Executive's termination of employment and the denominator of which is 12. • Upon termination for any reason other than Cause after the third anniversary of the Effective Date but prior to the end of the Plan Term, the Executive will be entitled to the following: (1) 60% of the amounts credited to the Executive at the time of termination if termination occurs on or after the third anniversary and prior to the fourth anniversary of the Effective Date and (2) 80% of the amounts credited to the Executive at the time of termination if termination occurs on or after the fourth anniversary of the Effective Date, unless, in either case, he would be entitled to a greater amount pursuant to the above formula. • Termination For Cause: No payment will be made. Also on February 15, 2008, the Company amended the Change of Control Agreement(as amended, the "Agreement") with the Executive, effective February 15, 2008(the "effective date"). The Agreement was amended in order to, among other things, (i) revise thedefinition of a "Change of Control," (ii) provide for a retention bonus of onetimes the Executive's Base Salary (as defined in the Agreement) to be paid ifthe Executive remains continuously employed with the Company until the firstanniversary of the Agreement Effective Date, (iii) increase the severancepayment to Executive upon termination of his employment for certain reasonsafter or otherwise in connection with a change of control and (iv) conform theAgreement to comply with Section 409A of the Internal Revenue Code of 1986, asamended. The Executive's severance benefit entitlements under the Agreement include: • Base Salary through the date of termination;• an amount equal to two and one-half times the sum of Mr. Frazier's Base Salary and annual bonus;• settlement of all deferred compensation arrangements in accordance with any then applicable deferred compensation plans or election forms;• continued coverage under the Company's welfare plans for up to twelve months; and• the immediate vesting and exercisability of the Executive's stock options for a period of 36 months from the date of termination. - ends - For further information please contact: Danka Business Systems PLCCheley Howes, Danka Investor Relations +1 727 622 2760Tony Hunter, Nautilus Management 0207 603 1515 Weber Shandwick FinancialGeorgia Dempsey 0207 067 0749 About Danka Business Systems PLC Danka is one of the nation's largest independent providers of office systemssolutions. For 30 years Danka has provided its customers with the equipment,supplies, software and integrated services and support they need to addresstheir print, copy and document workflow requirements. Danka delivers thesecomprehensive document solutions through a consultative model designed toimprove business processes, reduce costs and increase productivity that drivescustomer value and satisfaction. Danka services customers directly in 50 U.S.markets. For more information, visit www.danka.com. Certain statements contained in this press release, including statements relatedto Danka's future business and financial performance, are forward-looking. Suchstatements reflect the current views of Danka with respect to future events andare subject to certain risks, uncertainties and assumptions that could causeactual results to differ materially from those reflected in the forward-lookingstatements. Readers are cautioned not to place undue reliance on these forwardlooking statements, which reflect management's analysis only as of the date theyare made. Danka is a registered trademark. All other trademarks are the propertyof their respective owners. # # # This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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