Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On July 31, 2019, the Company entered into an employment agreement (the “
Agreement
”) with Mr. Hollinsworth, effective July 15, 2019, that includes the following terms:
Annual Cash Compensation
. Mr. Hollinsworth’s annual base salary will be $585,000 and his salary may be increased from time to time at the Company’s discretion. Mr. Hollinsworth’s target annual bonus for each calendar year during his employment period with the Company will be 85% of his base salary, with a maximum cash bonus equal to two (2) times the target bonus.
Annual Equity Awards
. For 2019, Mr. Hollinsworth will be entitled to a long-term incentive award with a target value equal to not less than 225% of his base salary, which award shall be in a form and on terms consistent with the long-term incentive awards of other senior executives of the Company granted in 2019. Thereafter, Mr. Hollinsworth will be eligible to receive annual grants of equity or other long-term incentive awards in amounts as determined by the Compensation Committee of the Board.
Benefits
. Mr. Hollinsworth will be eligible to participate in arrangements for health, insurance and retirement benefits available to other senior executives of the Company.
Termination Payments
. In the event that the Company terminates his employment without “cause” or if he resigns his employment for “good reason” (each as defined in the Agreement), Mr. Hollinsworth will be entitled to receive the following severance benefits, subject to Mr. Hollinsworth’s timely execution and
non-revocation
of a general release of claims in favor of the Company: (i) accrued, but unpaid base salary, paid time off and sick pay, (ii) accrued, but unpaid cash bonus with respect to a completed performance period, (iii) an amount equal to the sum of his base salary and target bonus, each as in effect at the time of his termination, (iv)
pro-rated
annual bonus for the year of termination based on actual performance, and (v) Company payment of premiums for continued health and dental insurance premiums for 18 months following Mr. Hollinsworth’s termination.
Restrictive Covenants
. Mr. Hollinsworth will be subject to
non-competition,
non-solicitation
and
non-disparagement
covenants during the term of his employment and for specified periods thereafter.
The foregoing description of the Agreement is qualified in its entirety by reference to the text of the Agreement, a copy of which is filed herewith as
Exhibit 10
, and is incorporated herein by reference.