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): January 25, 2011
RSC Holdings Inc.
RSC Holdings
III, LLC
RSC Equipment Rental, Inc.
(Exact name of registrant as specified in its charter)
|
|
|
|
|
Delaware |
|
001-33485 |
|
22-1669012 |
Delaware |
|
333-144625-01 |
|
41-2218971 |
Arizona |
|
333-144625 |
|
86-0933835 |
(State or other Jurisdiction of Incorporation) |
|
(Commission File Number) |
|
(IRS Employer Identification No.) |
|
|
|
6929 E. Greenway Parkway,
Suite 200
Scottsdale, Arizona
|
|
85254 |
(Address of Principal Executive Offices) |
|
(Zip Code) |
Registrant’s telephone number,
including area code: (480) 905-3300
|
N/A
|
(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:
o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o Soliciting material pursuant
to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule
14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule
13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
1
Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
2011 Annual Incentive Plan Criteria and Targets
On January 26, 2011, based upon the recommendation of our Compensation Committee, the
Board of Directors of RSC Holdings Inc. selected the business criteria set forth below
pursuant to the RSC Holdings Inc. Annual Incentive Plan (the Annual Incentive Plan) for
determining the amount of cash bonuses to be awarded to our named executive officers for the
year ending December 31, 2011 under the Annual Incentive Plan.
The Annual Incentive Plan is intended to encourage superior performance and to assist
us in attracting, retaining and motivating key personnel, and provides for annual cash
bonuses for eligible employees, including our executive officers. The Compensation
Committee, which administers the Annual Incentive Plan, determines the employees eligible to
participate in the Annual Incentive Plan in a particular year, as well as the particular
performance targets for such year and the range of possible payouts under the Annual
Incentive Plan depending on how actual results compare with the applicable performance
targets. In addition, the Compensation Committee may provide for a greater or lesser annual
cash bonus in its sole discretion.
The following 2010 named executive officers are eligible to earn bonuses under the
Annual Incentive Plan:
|
|
|
Erik Olsson, Chief Executive Officer; |
|
|
|
Patricia Chiodo, Senior Vice President and Chief Financial Officer; |
|
|
|
Kevin Groman, Senior Vice President, General Counsel and Corporate Secretary; |
|
|
|
Phil Hobson, Senior Vice President of Operations; |
|
|
|
David Ledlow, Senior Vice President of Operations; and |
|
|
|
such other officers as determined by the Compensation Committee. |
The payment of bonuses under the Annual Incentive Plan for 2011 will be based on our
achievement of objective performance goals measured by the following business criteria:
|
|
|
earnings before interest, taxes, depreciation, and amortization (EBITDA); and |
|
|
|
operating return on capital employed (OROCE). |
EBITDA is defined as consolidated net income before net interest expense, income taxes,
and depreciation and amortization. Any incremental EBITDA impact resulting from
acquisitions or extraordinary events during the performance period will be excluded.
OROCE is defined as operating return on capital employed, and is calculated by dividing
operating income (excluding transaction costs, management fees and amortization of
intangibles) for the preceding twelve months by the average operating capital employed for
the same period. For purposes of this calculation, average operating capital employed is
considered to be all assets other than cash, deferred tax assets, hedging derivatives,
goodwill and intangibles, less all liabilities other than debt, hedging derivatives and
deferred tax liabilities.
The Compensation Committee established the following weightings and threshold, target
and maximum payout amounts for the performance goals. Payout amounts are based upon the
base salary of the executive officer for the year ending December 31, 2011. For each
performance goal: Payout = Base Salary x (Weighting x Percentage Achievement).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payout
Percentage of Eligible Earnings |
|
|
|
|
Performance Goals - Erik Olsson |
|
Weighting |
|
|
Threshold |
|
|
Target |
|
|
Maximum |
|
EBITDA |
|
|
50 |
% |
|
|
50 |
% |
|
|
100 |
% |
|
|
200 |
% |
OROCE |
|
|
50 |
% |
|
|
50 |
% |
|
|
100 |
% |
|
|
200 |
% |
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payout
Percentage of Eligible Earnings |
|
|
|
|
Performance Goals - SVP |
|
Weighting |
|
|
Threshold |
|
|
Target |
|
|
Maximum |
|
EBITDA |
|
|
50 |
% |
|
|
37.5 |
% |
|
|
75 |
% |
|
|
150 |
% |
OROCE |
|
|
50 |
% |
|
|
37.5 |
% |
|
|
75 |
% |
|
|
150 |
% |
2010 Annual Incentive Plan Performance & Discretionary Bonus
On January 25, 2011, the Compensation Committee determined the extent to which
previously established 2010 performance goals under the Annual Incentive Plan were met for
2010, and approved the level of earned cash bonuses for 2010 for each of the named executive
officers, other than for Mr. Olsson for which the Compensation Committee approved a
recommendation to the Board of Directors to approve Mr. Olssons earned cash bonus. On
January 26, 2011, the Board of Directors determined the extent to which previously
established 2010 performance goals under the Annual Incentive Plan were met for 2010 and the
level of earned cash bonuses for 2010 for Mr. Olsson, pursuant to the Compensation
Committees recommendation.
Pursuant to the Annual Incentive Plan, Mr. Olsson, Ms. Chiodo, Mr. Ledlow, Mr. Hobson
and Mr. Groman will be paid the sums of $708,247, $156,394, $265,461, $233,606, and $247,764
respectively. In addition, the Compensation Committee, and the Board of Directors on
January 26, 2011, determined to provide additional discretionary bonus payments to Mr.
Olsson, Ms. Chiodo, Mr. Ledlow, and Mr. Groman in the sum of $30,000, $60,000, $10,000, and
$10,000 respectively.
A copy of the Annual Incentive Plan was previously filed as Exhibit 10.9 to the
Registration Statement on Form S-1/A of RSC Holdings Inc., dated April 18, 2007, (File No.
333-140644), and is incorporated herein by reference.
2