Current Report Filing (8-k)
August 11 2017 - 5:02PM
Edgar (US Regulatory)
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): August 9, 2017
WORKHORSE
GROUP INC.
(Exact
name of registrant as specified in its charter)
Nevada
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000-53704
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26-1394771
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(State
or Other Jurisdiction of Incorporation)
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(Commission
File Number)
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(IRS
Employer Identification Number)
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100
Commerce Drive, Loveland, Ohio 45140
(Address
of principal executive offices) (zip code)
513-297-3640
(Registrant's
telephone number, including area code)
Copies
to:
Stephen
M. Fleming, Esq.
Fleming
PLLC
49
Front Street, Suite 206
Rockville
Centre, New York 11570
Phone:
(516) 833-5034
Fax:
(516) 977-1209
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):
☐
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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☐
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Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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☐
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Pre-commencement communications
pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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☐
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Pre-commencement communications
pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Indicate by check mark whether the registrant is an emerging
growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities
Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
o
If an emerging growth company, indicate by check mark
if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act.
o
Item
1.01
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Entry
into a Material Definitive Agreement.
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Item
3.02
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Unregistered
Sales of Equity Securities
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Item
5.02
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Departure
of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
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On
August 9, 2017, Paul Gaitan and Workhorse Group Inc. (the “Company”) entered into an Executive Retention Agreement
whereby Mr. Gaitan was retained as Chief Financial Officer in consideration of an annual salary of $200,000. The Company also
granted stock options exercisable at $2.74 per share to Mr. Gaitan to acquire 200,000 shares of common stock of the Company, which
are exercisable for a period of ten years. The Stock Options
vest in 16 equal quarterly
tranches.
Commencing
during the year ended December 31, 2018, the Company has agreed to provide a bonus to Mr. Gaitan of 25% of his base salary upon
the Company achieving 75% of annual revenue targets established by the Board of Directors and management. The cash bonus will
be increased to 37.5% and 50% of the base salary in the event that 100% or 125% of the revenue target is achieved, respectively.
The Company and Mr. Gaitan entered into an Indemnification Agreement.
T
he
employment of each of Mr. Gaitan is at will and may be terminated at any time, with or without formal cause. Pursuant to the terms
of the executive retention agreement, the Company has agreed to provide specified severance and bonus amounts and to accelerate
the vesting on the equity awards upon termination upon a change of control or an involuntary termination, as each term is defined
in the agreements. The severance clause is not effective until November 9, 2017. In the event of a termination upon a change of
control or an involuntary termination, the executive is entitled to receive an amount equal to 12 months of their base salary
and the target bonus then in effect for the executive officer for the year in which such termination occurs, such bonus payment
to be pro-rated to reflect the full number of months the executive remained in the Company’s employ. In addition, the vesting
on any equity award held by the executive officer will be accelerated in full upon a change of control or an involuntary termination.
In the event the executive is terminated for cause, then the vesting of all equity awards shall cease and such equity awards will
be terminated. In the event the executive leaves for any reason that is not considered a good reason, then the vesting of equity
award shall cease. At the election of the executive officer, the Company will also continue to provide health related employee
insurance coverage for twelve months, at the Company’s expense upon termination upon a change of control or an involuntary
termination. On August 9, 2017, the Company and Mr. Rodriguez entered a letter agreement amending certain terms of his Executive
Retention Agreement dated May 19, 2017, pursuant to which Mr. Rodriguez agreed to serve as the Chief Information Officer at a
salary of $250,000 per year with stock options exercisable at $5.28 per share to acquire 300,000 shares of common stock of the
Company, which are exercisable for a period of ten years vesting over four years in instalments of 18,750 shares.
During
2016, Mr. Gaitan most recently served as Chief Financial Officer of Crown Health Care Laundry Services, where he helped set strategic
vision and drove excellence in accounting operations and financial reporting for an organization of 800 employees. From 2006 through
2015, Mr. Gaitan was employed by ClarkDietrich Building Systems, a light gauge steel framing manufacturer with revenue of $600m
per year, where he served as Chief Financial Officer from 2012 through 2015 and Controller from 2006 through 2012. Mr. Gaitan
has also held various controller roles at Axion Automotive Technologies, Endar Corporation, Dentsply International, Avery Dennison
and Cummins Engine Company. Mr. Gaitan earned his BS degree in business from the University of Southern California and his MBA
from Stanford University with a concentration in production control systems.
The
above offers and sales of the securities was made to an accredited investor and the Company relied upon the exemptions contained
in Section 4(2) of the Securities Act and/or Rule 506 of Regulation D promulgated there under with regards to the sales. No advertising
or general solicitation was employed in offerings the securities. The offers and sales were made to an accredited investor and
transfer of the securities was restricted by the Company in accordance with the requirements of the Securities Act of 1933.
The
foregoing is only a brief description of the material terms of the above corporate actions and agreements, and does not purport
to be a complete description of the rights and obligations of the parties under those agreements, and such descriptions are qualified
in their entirety by reference to the agreements which are filed as exhibits to this Current Report.
Item
9.01 Financial Statements and Exhibits.
(d) Exhibits.
(1)
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Incorporated by referenced to the Form 8-K Current
Report filed with the Securities and Exchange Commission dated May 19, 2017.
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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 hereunto duly authorized.
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WORKHORSE
GROUP INC.
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Date:
August 11, 2017
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By:
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/s/
Stephen S. Burns
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Name:
Title:
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Stephen
S. Burns
Chief Executive Officer
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