Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Election of New Director
On March 12, 2018, the Company announced that the Company’s Board of Directors had elected Robert G. Savage to serve as a director of the Company. Mr. Savage will serve as chair of the Compensation Committee and as a member of the Audit Committee.
A copy of the press release announcing Mr. Savage’s election is filed as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Amendment of 2012 Equity Plan
On March 9, 2018, the Board of Directors of the Company approved an amendment to the Company’s 2012 Equity Incentive Plan (the “Plan”) to increase the number of shares of the Company’s common stock authorized for issuance under the Plan by 16,050,000 shares, and to increase the annual maximum aggregate number of shares subject to stock option awards that may be granted to any one person under the Plan during a calendar year to 7,500,000. The additional 16,050,000 shares authorized for issuance under the Plan represent approximately 15% of the total number of shares outstanding as of March 9, 2018.
The Plan has also been amended to remove all Plan provisions formerly required to be included in the Plan for compliance with Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), in response to the recent legislative reforms to the Code.
Employment Contract with Greg Jester
On March 9, 2018, the Board of Directors of the Company authorized the Company to enter into an employment agreement with Jon G. Jester, the Company’s Chief Financial Officer (the “Agreement”). The Agreement provides for an initial annual base salary for Mr. Jester of $310,000, as well as eligibility for an annual bonus targeted at 50% of his salary based on the achievements of objectives set and agreed to by the Board. Such bonus may be a mix of cash and stock, as determined by the Board in its sole discretion. Mr. Jester is entitled to participate in the Company’s benefit plans available to other executives, including its retirement plan and health and welfare programs.
Under the Agreement, Mr. Jester is entitled to receive certain benefits upon termination of employment under certain circumstances. If the Company terminates Mr. Jester’s employment for any reason other than “Cause”, or if Mr. Jester resigns for “Good Reason” (each as defined in the Agreement), Mr. Jester will receive twelve months of base salary then in effect and the amount of the actual bonus earned by Mr. Jester under the agreement for the year prior to the year of termination, pro-rated based on the portion of the year Mr. Jester was employed by the Company during the year of termination.
The Agreement additionally provides that if Mr. Jester resigns for Good Reason or the Company or its successor terminates his employment within the three month period prior to and the 12 month period following a Change in Control (as defined in the Agreement), the Company must pay or cause its successor to pay Mr. Jester a lump sum cash payment equal to one and a half (1.5) times (a) his annual salary as of the day before his resignation or termination plus (b) the aggregate bonus received by Mr. Jester for the year preceding the Change in Control or, if no bonus was received, at minimum 50% of the target bonus. In addition, upon such a resignation or termination, all outstanding stock options held by Mr. Jester will immediately vest and become exercisable.
Item 9.01.
Financial Statements and Exhibits.
(d)
Exhibits
Exhibit No.
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Description
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99.1
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