form8kmaterialagreement.htm
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
May
30, 2007
Date
of Report (Date of earliest event reported)
THE
FAIRCHILD CORPORATION
(Exact
name of Registrant as specified in its charter)
|
Delaware
(State
of incorporation or organization)
|
Commission
File Number 1-6560
|
34-0728587
(I.R.S.
Employer Identification No.)
|
1750
Tysons Boulevard, Suite 1400, McLean, VA 22102
(Address
of principal executive offices)
(703)
478-5800
(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 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 (17CFR
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))
FORWARD-LOOKING
STATEMENTS:
Certain
statements in this filing contain "forward -looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995 with respect
to
our financial condition, results of operation and business. These statements
relate to analyses and other information, which are based on forecasts of future
results and estimates of amounts not yet determinable. These statements also
relate to our future prospects, developments and business strategies. These
forward-looking statements are identified by their use of terms and phrases
such
as “anticipate,’’ “believe,’’ “could,’’ “estimate,’’ “expect,’’ “intend,’’
“may,’’ “plan,’’ “predict,’’ “project,’’ “will’’ and similar terms and phrases,
including references to assumptions. These forward-looking statements involve
risks and uncertainties, including current trend information, projections for
deliveries, backlog and other trend estimates that may cause our actual future
activities and results of operations to be materially different from those
suggested or described in this financial discussion and analysis by management.
These risks include: our ability to finance and successfully operate our retail
businesses; our ability to accurately predict demand for our products; our
ability to receive timely deliveries from vendors; our ability to raise cash
to
meet seasonal demands; our dependence on the retail and aerospace industries;
our ability to maintain customer satisfaction and deliver products of quality;
our ability to properly assess our competition; our ability to improve our
operations to profitability status; our ability to liquidate non-core assets
to
meet cash needs; our ability to attract and retain highly qualified executive
management; our ability to achieve and execute internal business plans; weather
conditions in Europe during peak business season and on weekends; labor
disputes; competition; foreign currency fluctuations; worldwide political
instability and economic growth; military
conflicts,
including terrorist activities; infectious diseases; new legislation which
may
cause us to be required to fund our pension plan earlier than we had expected;
and the impact of any economic downturns and inflation.
If
one or
more of these and other risks or uncertainties materialize, or if underlying
assumptions prove incorrect, our actual results may vary materially from those
expected, estimated or projected. Given these uncertainties, users of the
information included in this report, including investors and prospective
investors, are cautioned not to place undue reliance on such forward-looking
statements. We do not intend to update the forward-looking statements included
in this filing, even if new information, future events or other circumstances
have made them incorrect or misleading.
Item
5.02(e) Compensatory Arrangements of Certain
Officers
On
May
30, 2007, a subsidiary of The Fairchild Corporation, PoloExpress GmbH, entered
into a restated and amended employment agreement with Mr. Klaus Esser, a
named executive officer of The Fairchild Corporation. PoloExpress is
a subsidiary of The Fairchild Corporation. It designs and sells
motorcycle protective apparel, helmets and accessories. Mr. Esser is
the Senior Operations Officer / President of PoloExpress.
The
initial term of the agreement is 7 years, beginning on January 1, 2006, and
ending on December 31, 2012. Unless either party elects otherwise no
later than March 31, 2012, the agreement will automatically renew. After
renewal, the agreement may be terminated by either party on twelve months
notice for the end of a calendar quarter.
The agreement
provides for an increase in base salary of 60,000 Euros to 300,000 Euros per
year.
In
addition, in fiscal years ending until September 30, 2008, if PoloExpress has
an
annual EBITDA of 5 Million Euros or more, Mr. Esser is entitled to a bonus
for
such year equal to 5% of the total EBITDA. In the fiscal year ending
on September 30, 2009, if PoloExpress has an annual EBITDA of 6 Million Euros
or
more, the bonus amount shall be 6% of the total EBITDA. For the
fiscal years ending after September 30, 2009, if PoloExpress has an annual
EBITDA of 7 Million Euros or more, the bonus amount shall be 6% of the total
EBITDA. The bonus for each year is paid in monthly installments. The actual
bonus amount is determined at the end of each year, after EBITDA is confirmed.
If the aggregate monthly installments paid by the Company to Mr. Esser are
less
than the bonus amount due for such year, a payment for such amount is made
at
year end by the Company to Mr. Esser. If the aggregate monthly
installments paid by the Company to Mr. Esser are more than the bonus amount
due
for such year, a payment for such amount is made at year end by Mr. Esser to
the
Company.
Until
December 31, 2008, following termination of the agreement, Mr. Esser agrees
not
to compete for a period of 24 months, provided that PoloExpress continues to
compensate Mr. Esser during such period at the rate of fifty percent (50%)
of
his average compensation. (The average compensation is based on the
last three years of employment, and includes base pay and
bonuses.) Within twenty eight (28) days of the termination of the
agreement, PoloExpress may elect not to enforce the two-year non-compete
covenant, in which case Mr. Esser shall not compete for a one-year period as
specified in Paragraph 75a of the German Commercial Code and PoloExpress will
compensate Mr. Esser at the rate of 30,000 Euros per month during such
period.
Starting
January 1, 2009, following termination of the agreement, Mr. Esser agrees not
to
compete for a period of 24 months, provided that PoloExpress continues to
compensate Mr. Esser during such period at the rate of fifty percent (50%)
of
his average compensation. (The average compensation is based on the
last three years of employment, and includes base pay and
bonuses.).
ITEM
9.01. FINANCIAL STATEMENTS AND EXHIBITS
(d)
Exhibits.
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of page intentionally left blank.]
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 thereunto
duly authorized.
Dated
June 5, 2007
THE
FAIRCHILD CORPORATION
By:
/s/
DONALD E. MILLER
Name:
Donald E. Miller
Title:
Executive Vice President,
Corporate
Secretary and General Counsel