Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Annual Incentive Award Program
On March 7, 2023, the Compensation Committee (the "Committee") of the Board of
Directors of Perdoceo Education Corporation (the "Company") approved the 2023
Annual Incentive Plan (the "2023 AIP"). The 2023 AIP updates the nomenclature of
the financial performance measure used in the Company's 2022 Annual Incentive
Plan (the "2022 AIP") from adjusted EBITDA to adjusted operating income to be
consistent with the Company's external reporting. The 2023 AIP is similar to the
2022 AIP in all other material respects. As with the 2022 AIP, the 2023 AIP will
use a company-wide adjusted operating income performance component (80%
weighting) and an individual goals performance component (20% weighting) for the
most senior level participants, including the Company's executive officers.
Achievement of the target level of performance for the adjusted operating income
performance component results in a payout factor of 100%, with achievement of a
threshold adjusted operating income performance level required for any payments
under the 2023 AIP and a payment cap of 200% of a participant's AIP target
value. In addition, the payout opportunity for the individual goals performance
component will also vary based on the level of achievement of the adjusted
operating income performance component to further support the achievement of the
Company's business objectives.
The foregoing description is not a complete description of all of the rights and
obligations under the 2023 AIP and is qualified in its entirety by reference to
the 2023 AIP, a copy of which is attached as Exhibit 10.1 hereto and is
incorporated herein by reference.
Other Compensation Matters
On March 7, 2023, the Committee approved revised compensation arrangements for
certain executive officers. The Committee approved the following increased base
salaries, effective March 1, 2023: $650,000 for Mr. Hurst, $489,720 for Mr.
Ghia, $388,773 for Mr. Kline, $386,750 for Ms. Baskel and $388,500 for Mr.
Jansen. In addition, effective for 2023, Mr. Hurst's AIP target value was
increased from 85% to 100% of base salary, and Mr. Ghia's AIP target value was
increased from 80% to 90% of base salary. On March 7, 2023, the Committee also
awarded additional and retention bonus awards to certain named executive
officers. The Committee awarded Mr. Kline an additional bonus award in the
amount of $370,260, payable in cash in two equal installments on each of March
1, 2024 and 2025, and awarded Ms. Baskel an additional bonus award in the amount
of $350,000, payable in cash in two equal installments on each of June 30, 2023
and March 1, 2024. These awards were made in recognition of Mr. Kline's and Ms.
Baskel's contributions and as a retention tool because of their critical role as
leaders of our academic institutions. The Committee also awarded a retention
bonus of $60,000 to Mr. Jansen, payable in cash on June 30, 2023, in recognition
of his efforts in overseeing recent acquisitions.
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Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
The exhibits to this Current Report on Form 8-K are listed in the "Exhibit
Index" which is contained herein and incorporated herein by reference.
Exhibit Index
Exhibit Description of Exhibit
Number
*10.1 2023 Annual Incentive Plan
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
* Management contract or compensatory plan or arrangement.
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