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) May 24, 2006
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L.B. Foster Company
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(Exact name of registrant as specified in its charter)
Pennsylvania 000-10436 25-1324733
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
415 Holiday Drive, Pittsburgh, Pennsylvania 15220
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 412-928-3417
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None
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(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 (see General Instruction A.2. below):
[ ] 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 1.01 Entry Into a Material Definitive Agreement
A. 2006 Omnibus Incentive Plan
On May 24, 2006, the Registrant's shareholders approved the 2006 Omnibus
Incentive Plan (the "Omnibus Plan"). The Plan provides for the issuance of up to
500,000 shares of the Company's common stock (which may include newly issued or
treasury shares) through the exercise of stock options or the grant of common
stock.
Administration
The Board of Directors' Compensation Committee will administer the Omnibus
Plan. Within the parameters set forth in the Omnibus Plan, the Committee has the
authority to determine those key employees or directors who shall receive a
discretionary award and the terms and conditions of each such award. The
Committee may also prescribe regulations for the operation of the Omnibus Plan
and interpret the Omnibus Plan and option or restricted stock agreements issued
under the Omnibus Plan. In addition to discretionary awards made by the
Committee, non-employee directors automatically shall be awarded 3,500 shares of
common stock after each annual shareholders meeting, beginning with the annual
shareholders' meeting on May 24, 2006. These automatic awards are described
below under "Automatic Stock Awards".
Description
Stock options ("Options") and stock awards ("Stock Awards") may be granted,
in the Committee's discretion, to key personnel and directors. Options and Stock
Awards granted to non-employee directors are hereinafter respectively referred
to as "Director Options" or "Director Awards". Options and Stock Awards are
subject to the following provisions of the Omnibus Plan, and the terms and
provisions of such options or stock awards need not be uniform:
Options
Exercise Price
The exercise price of the Options is determined by the
Committee, but shall be not less than the last reported sale
price of the common stock on the NASDAQ National Market on the
date of grant. The exercise price is payable in cash or other
medium acceptable to the Company.
Term
The term of the Options is determined by the Committee, but
shall not exceed 10 years from the date of grant.
Except as otherwise provided in the option agreement, Options, other than
Director's Options, will terminate 30 days after termination of the
participant's employment with the Company for any reason other than death,
disability or retirement with the consent of the Company. Non-Employee Director
Options are immediately exercisable for a period of 10 years from the date of
the award. Except as otherwise provided in the option agreement, other
discretionary Options may be exercised in cumulative annual installments, each
for one-fourth of the total optioned shares, commencing one year from the date
of grant.
Stock Awards
Automatic Stock Awards
Commencing with the May 24, 2006 annual meeting of
shareholders, each non-employee director automatically shall
be granted a Director Award of 3,500 shares of fully vested
common stock.
Other Stock Awards
Stock Awards may also be granted to key personnel and
directors in the discretion of the Committee. Such Stock
Awards shall become vested and/or saleable pursuant to the
terms of the applicable stock award agreement specified by the
Committee.
Amendments and Termination
The Board may at any time amend the Omnibus Plan or amend any outstanding
award agreement for the purpose of satisfying any legal requirement or for any
other legal permissible purpose; provided that an amendment shall not be deemed
permissible if it would result in Rule 16b-3 under the Securities Exchange Act
of 1934, as amended, being inapplicable to any award. The Board may terminate
the Plan at any time, but no such termination shall adversely affect the rights
of any participant under any award previously granted in which the participant
has a vested interest.
In the event of a stock dividend, recapitalization or merger in which the
Company is the surviving corporation or other similar capital change, the number
and shares of stock then outstanding or to be awarded thereunder, the maximum
number of shares of stock or securities which may be issued on the exercise of
Options granted under the Omnibus Plan, the exercise price and other relevant
provisions shall be appropriately adjusted by the Board. In the event of a
consolidation or a merger in which the Company is not the surviving corporation,
or any other merger in which the shareholders of the Company exchange their
shares of stock in the Company for stock of another corporation, or in the event
of complete liquidation of the Company, or in the case of a tender offer
accepted by the Board of Directors, all outstanding Options shall thereupon
terminate, provided that the Board may, prior to the effective date of any such
consolidation or merger, either (i) make all outstanding Options immediately
exercisable or (ii) arrange to have the surviving corporation grant to the
participants replacement Options on terms which the Board shall determine to be
fair and reasonable.
B. Board of Directors' Compensation
On May 24, 2006, the Registrant's Board of Directors altered the
compensation payable to the Registrant's outside directors. The annual fee paid
to each of the Corporation's outside directors shall be the sum of (i) a $31,500
annual base fee for each Chairman of the Audit Committee, Compensation Committee
and the Nomination & Governance Committee and a $29,000 annual base fee for
other outside directors, plus $1,000 for each non-telephonic Board of Directors
meeting attended (whether such attendance is in person or via telephone), $500
for each Committee meeting (telephonic or non-telephonic) attended and $500 for
each telephonic Board of Directors meeting attended, payable quarterly in
arrears, effective June 1, 2006; and (ii) pursuant to the 2006 Omnibus Plan, an
annual grant of 3,500 shares of the Corporation's common stock as of each annual
shareholders' meeting at which the outside director is elected (or re-elected)
as a director of the Corporation, effective May 24, 2006.
C. Amendment to Amended and Restated 1998 Long-Term Incentive Plan
("1998 Plan")
Under the 1998 Plan, outside directors were automatically awarded
non-qualified options to purchase 5,000 shares of Registrant's common stock when
the director was elected or re-elected at an annual shareholders' meeting. Due
to the Registrant's shareholders approving the 2006 Omnibus Incentive Plan on
May 24, 2006, the 1998 Plan has been amended, effective May 24, 2006, so that
outside directors no longer receive this automatic stock option grant.
D. Special Bonus
On May 24, 2006, pursuant to previous authorization from Registrant's Board
of Directors, the Registrant agreed to provide John F. Kasel (Registrant's Sr.
Vice President - Operations) with a special bonus arrangement. Subject to Mr.
Kasel then being employed by L.B. Foster Company or any of its wholly owned
subsidiaries (collectively the "Company"), the Company shall pay $35,750 to Mr.
Kasel on each of August 10, 2006, August 10, 2007, August 10, 2008 and August
10, 2009 (or as soon thereafter as is practical but in all events no later than
2 1/2 months after the end of each applicable year) minus (for each payment) the
amount, if any, by which the average closing price of the Company's common stock
for all trading days from June 1 to July 31, inclusive, of the applicable year
is less than $14.77/share, multiplied by 6,250.
Item 1.02 Termination of a Material Definitive Agreement
Under the Outside Directors Stock Award Plan, Registrant's outside
directors were automatically awarded 2,500 shares of Registrant's common stock
when the director was elected or re-elected at an annual shareholders' meeting.
Since Registrant's shareholders approved the Omnibus Plan on May 24, 2006, the
Outside Directors Stock Award Plan has been terminated, effective May 24, 2006.
Item 9.01 Exhibits
10.34.1
Amendment, effective May 24, 2006, to Amended and Restated 1998 Long-Term
Incentive Plan. **
10.52.1
Termination of Outside Directors Stock Award Plan, effective May 24, 2006. **
10.53
Directors Resolution dated May 24, 2006 under which outside directors
compensation was established. **
10.57
2006 Omnibus Incentive Plan, effective May 24, 2006. **
10.58
Special Bonus Arrangement, effective May 24, 2006. **
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** Identifies management contract or compensatory plan or arrangement required
to be filed as an Exhibit.
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.
L.B. FOSTER COMPANY
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(Registrant)
Date: May 31, 2006
/s/ Stan L. Hasselbusch
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Stan L. Hasselbusch
President and Chief Executive Officer
Exhibit Index
Exhibit Number Description
10.34.1 Amendment, effective May 24, 2006, to Amended
and Restated 1998 Long-Term Incentive Plan. **
10.52.1 Termination of Outside Directors Stock Award
Plan, effective May 24, 2006. **
10.53 Directors Resolution dated May 24, 2006 under
which outside directors compensation was
established. **
10.57 2006 Omnibus Incentive Plan, effective
May 24, 2006. **
10.58 Special Bonus Arrangement,
effective May 24, 2006. **
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** Identifies management contract or compensatory plan or arrangement required
to be filed as an Exhibit.