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): March 1, 2010
ICF International, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 001-33045 | 22-3661438 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification Number) | ||
| 9300 Lee Highway, Fairfax, Virginia | 22031 | |||
| (Address of principal executive offices) | (Zip Code) | |||
Registrant’s telephone number, including area code: (703) 934-3000
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)) |
| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
(c) On March 1, 2010, ICF International, Inc. (the “Company”) issued a press release to announce that Ronald P. Vargo, age 55, is joining the Company and will assume the position of executive vice president and chief financial officer effective April 1, 2010. Mr. Vargo served as the executive vice president and chief financial officer of Electronic Data Systems Corporation (“EDS”), a former $22 billion global technology services company, from 2006 to 2008 until EDS was acquired by Hewlett-Packard Company. Prior to his role as executive vice president and chief financial officer, Mr. Vargo served in the positions of vice president and treasurer of EDS from 2004 to 2006. Prior to joining EDS, Mr. Vargo was employed from 1991 to 2003 by TRW, Inc. (“TRW”), a former $17 billion global manufacturing and service company strategically focused on providing products and services with a high technology or engineering content to the automotive and space and defense markets. TRW was acquired by Northrop-Grumman Corporation in 2002. Mr. Vargo served TRW in the positions of vice president and treasurer from 1991 to 1994, then vice president of strategic planning and business development from 1994 to 1999, and then vice president and treasurer again from 1999 to 2003.
Mr. Vargo’s employment will be at-will. He will receive a salary of $425,000 per year and a signing bonus of $100,000. He will be eligible for an annual cash bonus, the amount of which will be dependent upon the achievement of certain target performance goals to be established by the Company’s Compensation Committee. Such bonus will be no less than $297,500 for 2010. Mr. Vargo will also be eligible to receive annual equity awards, as determined by the Compensation Committee. For 2010, he will be eligible to receive 90% of his base salary in an equity grant.
Shortly upon joining the Company, Mr. Vargo will receive an option award equal to an aggregate fair market value of $260,000 and a grant of restricted stock units equal to an aggregate fair market value of $280,000. He will also receive a second option award equal to an aggregate fair market value of $260,000 and a second grant of restricted stock units equal to an aggregate fair market value of $280,000 in early May 2010.
The Company and Mr. Vargo have entered into a Severance Protection Agreement which is effective on March 1, 2010 and which will remain in effect until February 28, 2014 (the “Agreement”). On and after each anniversary date of March 1, 2014, the term of the agreement shall automatically be extended for an additional year unless, not later than October 1 of the prior year, the Company or Mr. Vargo shall give notice not to renew the Agreement. Under the Agreement, Mr. Vargo will be entitled to certain payments in the event of (i) separation from service by the Company other than for Cause (as defined in the Agreement) prior to a Change in Control (as defined in the Agreement) or (ii) separation from service by the Company other than for Cause or by Mr. Vargo for Good Reason (as defined in the Agreement) within the 24-month period following a Change in Control.
In the event of a separation from service prior to a Change in Control, under the Agreement, Mr. Vargo will be entitled to (i) bi-weekly payments of his annual base salary in effect on the date of his separation from service not to exceed, in the aggregate, the severance pay exclusion amount under Section 409A of the Internal Revenue Code (“Section 409A”) and (ii) a lump-sum payment in an amount equal to the average annual bonus paid to Mr. Vargo, plus any base salary payments that exceed the severance pay exclusion amount under Section 409A. Mr. Vargo’s average annual bonus will be calculated by taking the average of his annual cash incentive awards received from the Company (including any deferred cash incentive awards) with respect to the three calendar years preceding his separation from service. In the event that his separation from service were to occur before Mr. Vargo has been employed for three full calendar years, $297,500 shall be used for the 2010 bonus amount, plus any annual cash incentive awards received from the Company (including deferred cash incentive awards) for each full calendar year thereafter. The portion of severance benefits attributable to base salary will be paid on the 26 biweekly pay dates following separation from service pursuant to the Company’s normal payroll practices. The bonus portion of the severance benefit will be paid in a lump-sum within the 15-day period following the last payment of such biweekly base salary severance benefits.
In the event of separation from service after a Change in Control, Mr. Vargo will be entitled to a lump-sum payment equal to three times his average base amount for the three years prior to his separation from service. If such separation from service after a Change in Control were to occur before Mr. Vargo has been employed for three full calendar years, then the base amount for 2010 shall be $722,500; and the base amount for any full calendar year after 2010 will be his annual taxable W-2 compensation plus deferred cash incentive compensation. The base salary portion of the severance benefits will be paid in a single lump-sum amount upon termination not to exceed, in the aggregate, the severance pay exclusion amount under Section 409A. Any amount that exceeds the severance pay exclusion amount under Section 409A will be paid out via an additional severance amount six months after termination, in accordance with Section 409A.
In addition, Mr. Vargo is entitled to accelerated vesting of all stock options, restricted stock and other equity awards. He and his dependents will receive continuation of health, dental insurance and related benefits for 12 months following his involuntary termination of employment prior to a change in control, and for 36 months following his involuntary termination of employment after a change in control.
Payment of the above severance benefits are subject to Mr. Vargo’s compliance with certain covenants and requirements upon termination.
| Item 9.01 | Financial Statements and Exhibits |
| (c) | Exhibits | |
| 99.1 |
Press Release of ICF International, Inc. dated March 1, 2010 | |
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.
| ICF International, Inc. | ||||
| Date: March 5, 2010 | By: | /s/ Sudhakar Kesavan | ||
| Sudhakar Kesavan | ||||
| Chief Executive Officer | ||||
Exhibit 99.1
|
NEWS RELEASE |
ICF International Names Ronald P. Vargo
Executive Vice President and Chief Financial Officer
Former CFO of EDS Joins ICF Executive Management Effective April 1
FOR IMMEDIATE RELEASE
Investor Information Contact: MBS Value Partners
Lynn Morgen, 1-212-750-5800, lynn.morgen@mbsvalue.com
or
ICF International Contact:
Doug Beck, 1-703-934-3820, dbeck@icfi.com
FAIRFAX, Va. – ICF International (NASDAQ:ICFI), a leading provider of consulting services and technology solutions to government and commercial clients, announced that it has named Ronald P. Vargo to the position of executive vice president and chief financial officer effective April 1, 2010. He will replace Alan Stewart, currently executive vice president and chief financial officer, who previously announced that he would retire from the company at the end of March 2010.
Mr. Vargo, 55, brings 30 years of experience as a financial and business executive to ICF International. Most recently, he was executive vice president and chief financial officer of EDS, a $22 billion global technology services company that was acquired by Hewlett-Packard Company in 2008. In his position at EDS, Mr. Vargo was responsible for the company’s overall financial plans, policies, and accounting practices and oversaw EDS’s global finance organization.
Commenting on this appointment, ICF International Chairman and Chief Executive Officer Sudhakar Kesavan said, “Adding a leader of Ron Vargo’s caliber and range to our executive management team is an important element of our growth strategy. His global experience in finance, business development, and government and commercial services enhances our ability to continue to post strong organic growth and to serve as an effective platform for additional acquisitions.”
Prior to joining EDS as vice president and treasurer in 2004, Mr. Vargo spent 12 years with TRW, a $17 billion multi-industry global company, serving as vice president and treasurer and vice president of strategic planning and business development during his tenure. Before that, Mr. Vargo had a 10-year career at The Standard Oil Company and British Petroleum PLC, where he held several finance and line positions. Mr. Vargo graduated from Dartmouth College and received an MBA in Finance and General Management from Stanford University.
Mr. Vargo currently serves on the Board of Directors of Ferro Corporation, a publicly traded, leading global supplier of technology-based performance materials for manufacturers, headquartered in Cleveland.
“I look forward to joining the executive management of a company whose domain expertise is so closely aligned with the most prominent global issues of this century,” Mr. Vargo said. “This is a great opportunity for me to play an important role in the company’s future growth.”
About ICF International
ICF International (NASDAQ:ICFI) partners with government and commercial clients to deliver professional services and technology solutions in the energy and climate change; environment and infrastructure; health, human services, and social programs; and homeland security and defense markets. The firm combines passion for its work with industry expertise and innovative analytics to produce compelling results throughout the entire program life cycle, from research and analysis through implementation and improvement. Since 1969, ICF has been serving government at all levels, major corporations, and multilateral institutions. More than 3,500 employees serve these clients worldwide. ICF’s Web site is http://www.icfi.com/.
Caution Concerning Forward-looking Statements
Statements that are not historical facts and involve known and unknown risks and uncertainties are “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Such statements may concern our current expectations about our future results, plans, operations and prospects and involve certain risks, including those related to the government contracting industry generally; our particular business, including our dependence on contracts with U.S. federal government agencies; and our ability to acquire and successfully integrate businesses. These and other factors that could cause our actual results to differ from those indicated in forward-looking statements are included in the “Risk Factors” section of our securities filings with the Securities and Exchange Commission. The forward-looking statements included herein are only made as of the date hereof, and we specifically disclaim any obligation to update these statements in the future.
###