MasterCraft Boat Holdings, Inc. appointed Mr. Brightbill as new CEO

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Leadership Transition 


On March 4, 2024, Frederick Brightbill, Chief Executive Officer and Chairman of the Board of Directors of MasterCraft Boat Holdings, Inc. (the "Company") announced his retirement as Chief Executive Officer of the Company, effective March 18, 2024, and as Chairman of the Company's Board of Directors (the "Board"), effective June 30, 2024. 


In connection with Mr. Brightbill's retirement, the Company appointed Brad Nelson as Chief Executive Officer, effective March 18, 2024. Mr. Nelson will also join the Board at that time, with the size of the Board increasing from eight members to nine. Rock Lambert, the Company's Lead Independent Director, will assume the role of Chairman of the Board, effective July 1, 2024. 


In order to ensure a smooth transition, Mr. Brightbill will remain an employee of the Company through June 30, 2024 and will serve as a consultant from July 1, 2024 through June 30, 2025 pursuant to a Retirement and Consulting Agreement, the terms of which are summarized below. 


Mr. Nelson, age 54, most recently served as Executive Vice President and President, Commercial Segment of Oshkosh Corporation ("Oshkosh"). Mr. Nelson joined Oshkosh in 2011, where, in addition to his most recent role, he held several titles of increasing responsibility, including Senior Vice President and President, Commercial Business Segment and Vice President, Global Marketing, JLG Industries. Prior to joining Oshkosh, Mr. Nelson served in several leadership positions at Eaton Corporation, including Vice President, Global Marketing & Communications, Electrical Segment and Business Unit Manager, Power Quality Division, and Division Marketing Manager. Mr. Nelson earned an MBA from Brigham Young University and a Bachelor of Science in Business Administration from the University of Phoenix. 


Brightbill Retirement and Consulting Agreement 


As noted above, in connection with Mr. Brightbill's retirement, the Company and Mr. Brightbill entered into a Retirement and Consulting Agreement, dated March 1, 2024 (the "Retirement and Consulting Agreement"), pursuant to which he will remain an employee of the Company until June 30, 2024 and serve as a consultant to the Company from July 1, 2024 until June 30, 2025 (the "Consulting Period"). During the Consulting Period, Mr. Brightbill will be tasked with providing strategic advice and support to ensure a smooth transition, advising on historical matters and such other activities as may be requested from time to time by the Board. In exchange for these services, Mr. Brightbill will be entitled to the following: (i) continuation of his existing base salary ($725,000 per annum) through the end of the Consulting Period; (ii) continued vesting of all outstanding equity incentive awards through the final vesting date of such awards as if Mr. Brightbill remained employed with the Company through such date; and (iii) continuation of certain other benefits through the end of the Consulting Period. Mr. Brightbill will not receive any new equity incentive awards or be entitled to any additional compensation. The Retirement and Consulting Agreement also contains customary general release of claims and various restrictive covenants, including non-competition, non-solicitation and confidentiality. The foregoing summary of the Retirement and Consulting Agreement is not complete and is subject to, qualified in its entirety by, and should be read in conjunction with, the full text of the Retirement and Consulting Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.


Mr. Brightbill's retirement was not a result of any disagreement with the Company on any matters related to its operations, policies or practices.


Nelson Offer Letter 


In connection with Mr. Nelson's appointment as Chief Executive Officer, the Company provided an offer letter, dated as of March 1, 2024, which provides for the following key compensation and benefits: 


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annual base salary of $645,000;


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eligibility for an annual cash bonus under the Company's short-term incentive plan ("STIP") with a target award equal to 100% of base salary, based upon annual performance targets established by the Board (or the Compensation Committee thereof); 


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eligibility for an annual long-term incentive award under the Company's long-term incentive plan ("LTIP") with a target award equal to 190% of base salary; 


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a sign-on bonus consisting of a one-time grant of restricted stock ("RSAs") under the LTIP with a fair market value on the date of grant equal to $1,000,000. The RSAs will vest in three equal installments on the first, second and third anniversaries of the grant date, subject to Mr. Nelson's continued employment with the Company through each vesting date; 


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severance payments equal to one year base salary plus annual STIP award (at target) in the event Mr. Nelson (i) is terminated without "cause" or (ii) no longer serves as Chief Executive Officer within one year following a change in control of the Company; and


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relocation expense reimbursement, temporary housing and participation in the Company's retirement, health and welfare, vacation and other benefit programs.


Mr. Nelson will also enter into the Company's standard form of indemnification agreement for directors and officers, a form of which was previously filed by the Company as Exhibit 10.9 to the Company's Registration Statement on Form S-1/A on July 7, 2015.


There are no arrangements or understandings between Mr. Nelson and any other persons pursuant to which he was elected as an officer or director of the Company. There are also no family relationships between Mr. Nelson and any director or executive officer of the Company. Mr. Nelson has no direct or indirect material interest in any related party transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K. 


The foregoing summary of the Offer Letter is not complete and is subject to, qualified in its entirety by, and should be read in conjunction with, the full text of the Offer Letter, which is filed as Exhibit 10.2 to this Current Report on Form 8-K and incorporated herein by reference.