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
20, 2006
FRANKLIN
COVEY CO.
(Exact
name of registrant as specified in its charter)
Commission
File No. 1-11107
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Utah
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87-0401551
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(State
or other jurisdiction of incorporation)
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(IRS
Employer Identification Number)
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2200
West Parkway Boulevard
Salt
Lake City, Utah 84119-2099
(Address
of principal executive offices)(Zip Code)
Registrant’s
telephone number, including area code: (801)
817-1776
Former
name or former address, if changed since last report: Not
Applicable
______________________
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))
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Item
1.01
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Entry
Into a Material Definitive
Agreement
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At
Franklin Covey Co.’s (the Company) annual meeting of shareholders held on
January 20, 2006, the Company’s shareholders approved amendments to its 1992
Stock Incentive Plan and 2004 Non-Employee Directors’ Stock Incentive
Plan. These amendments had previously been approved by the board of
directors of the Company and were effective on approval by the
shareholders. The following is a description of the amendments to
these plans.
Amended
and Restated 1992 Stock Incentive Plan
The
Franklin Covey Co. Amended and Restated 1992 Stock Incentive Plan (the Plan)
was
originally adopted and approved by shareholders in March 1992 and has
subsequently been amended to meet Company needs and to keep shares issued under
the plan compliant with applicable rules and regulations. The amendment approved
on January 20, 2006 (the Amendment) had the following effect on the
Plan:
| · |
Increase
in Maximum Share Limitation
-
The maximum number of shares of common stock reserved for issuance
under
the Plan increased from 6,000,000 shares to 7,000,000 shares.
Additionally, any shares of common stock surrendered by a participant
or
withheld by the Company to pay the exercise price or withholding
taxes
associated with the exercise or settlement of an award under the
Plan may
be used for additional awards.
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Individual
Award Limits - The
Amendment imposes the following additional limitations on awards
under the
Plan: (i) Options or stock appreciation rights for no more than 250,000
shares of common stock may be granted to any one person in a calendar
year, (ii) no more than 250,000 shares of unvested common stock may
be
issued to any one participant in a calendar year, and (iii) no more
than
250,000 shares of common stock may be issued to any one participant
upon
vesting of stock units, including performance shares, in any one
calendar
year.
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Performance
Shares (General) -
The Amendment permits stock units to be granted in the form of performance
shares to key employees of the Company. Performance shares will provide
the holder with the right to receive, upon completion of specified
performance periods of not less than 12 months, a designated number
of
shares to be issued based upon the extent to which the Company and
its
consolidated subsidiaries achieve pre-determined target levels of
performance during the applicable performance periods. Performance
shares
are non-transferable (except upon death) and a holder of performance
shares must be employed by the Company at the end of the applicable
performance period to receive any shares under the award unless he
or she
is no longer employed as a result of death, permanent disability,
or
retirement.
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Performance
Shares Issued to Reporting Persons - In
the case of performance shares issued to key executives deemed to
be
“Reporting Persons,” the specific business criteria upon which the number
of shares to be issued will be based on (i) the amount of the
Company’s cumulative, consolidated net income (or loss) from operations
during a specified period of at least three years; and (ii) the Company’s
cumulative consolidated revenue growth during that performance period.
A
committee of the Board of Directors must establish, in writing, the
targeted levels of achievement for the performance goals for the
performance period in question not later than 90 days after the start
of
the performance period and the number of shares to be issued if that
targeted level of performance is
met.
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2004
Non-Employee Directors’ Stock Incentive Plan
The
Franklin Covey 2004 Non-Employee Directors’ Stock Incentive Plan (the Directors’
Plan) was ratified by shareholders in March 2005 and was designed to provide
non-employee directors of the Company, who are ineligible to participate in
the
Company’s incentive plan, an opportunity to acquire a proprietary interest in
the Company through the acquisition of shares of common stock. Under the
previous provisions of the Directors’ Plan, each non-employee director received
an annual unvested stock award with a value (based on the trading price of
the
Company’s common stock on the date of the award) equal to $27,500. The
amendment approved by the shareholders in January 2006 changes the
annual unvested stock grant to 4,500 shares of common stock. The Amendment
also
eliminates the limitation on the maximum dollar value of all awards made under
the Directors’ Plan in any given year.
For
further information on the foregoing compensation plans and the amendments
to
those plans, refer to the Company’s Definitive Proxy Statement for the Annual
Meeting of Shareholders held on January 20, 2006.
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Item
9.01
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Financial
Statements and Exhibits
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(c)
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Exhibits |
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99.1
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The Fifth Amendment of the Franklin Covey Co.
Amended and Restated 1992 Stock Incentive Plan was included as
Appendix A
to the Definitive Proxy Statement filed Decmeber 12, 2005 and is
incorporated herein by this reference.
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99.2
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The
First Amendment to the Franklin Covey Co. 2004 Non-Employee Director
Stock
Incentive Plan was included as Appendix B to the Definitive Proxy
Statement filed December 12, 2005 and is incorporated herein by
this
reference.
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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.
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FRANKLIN
COVEY CO.
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Date:
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January
26, 2006
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By:
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/s/ STEPHEN D. YOUNG | |
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Stephen
D. Young
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Chief
Financial Officer
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