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): December 15, 2005
ESCO TECHNOLOGIES INC.
(Exact Name of Registrant as Specified in Charter)
Missouri 1-10596 43-1554045
(State or Other (Commission (I.R.S. Employer
Jurisdiction of Incorporation) File Number) Identification No.)
9900A Clayton Road, St. Louis, Missouri 63124-1186
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: 314-213-7200
Item 1.01 Entry into a Material Definitive Agreement
1. The Company has historically established bonus targets and awarded the
executive officers annual cash incentive compensation ("bonuses") under its
Performance Compensation Plan (the "Existing Plan"). Commencing with fiscal year
2006, and subject to shareholder approval of the Incentive Compensation Plan For
Executive Officers (the "ICP") described below in paragraph 3, the Company
proposes to divide each executive officer's bonus target between two plans, one
the Existing Plan and the other the ICP. Actual bonus payments shall be
determined and paid utilizing evaluation criteria approved by the Human
Resources and Compensation Committee (the "Committee") of the Board of Directors
of the Company.
2. Accordingly, under the Existing Plan, the Committee, on December 15, 2005,
confirmed its approval of the fiscal year 2006 bonus targets for the executive
officers of the Company, as follows: V.L. Richey and C.J. Kretschmer--20% of
fiscal 2006 total cash compensation; G.E. Muenster and A.S. Barclay--15% of
fiscal 2006 total cash compensation. The Committee also approved the fiscal year
2006 evaluation criteria for the determination of the actual Existing Plan
bonuses to be paid to the executive officers after the end of the fiscal year.
Under the Existing Plan, the Committee will evaluate and measure the performance
of the executive officers based on the achievement of various Company and
individual objectives, weighted as follows: operating results--20%; shareholder
value--30%; economic profit improvement--10%; growth--10%; and individual
objectives--30%. The actual bonuses to be paid under the Existing Plan may vary
from the bonus targets depending on the extent to which performance exceeds or
falls below the evaluation criteria established by the Committee.
3. In addition, under the proposed ICP, which was approved by the Committee on
November 9, 2005 (and which is expected to be approved by shareholders at the
Company's Annual Meeting on February 2, 2006), the Committee conditionally
approved the fiscal year 2006 bonus targets for the executive officers, as
follows: V.L. Richey and C.J. Kretschmer-20% of fiscal year 2006 total cash
compensation; G.E. Muenster and A.S. Barclay-15% of fiscal 2006 total cash
compensation. The actual bonuses to be paid under the ICP may vary from the
bonus targets based upon the application of the fiscal year 2006 ICP earnings
per share matrix, as approved by the Committee.
SIGNATURE
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.
ESCO TECHNOLOGIES INC.
Dated: December 21, 2005 By: /s/ G.E. Muenster
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G.E. Muenster
Senior Vice President and
Chief Financial Officer