DAIO Data I O Corp

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:

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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         □

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        □

Items reported in this filing:

Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers

Item 9.01 Financial Statements and Exhibits

Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers.

A press release on June 30, 2023, announced that Data I/O has appointed Gerald Ng as its Vice President of Finance effective July 1, 2023. Effective August 16, 2023, he will become the Company’s Vice President and Chief Financial Officer. 

Gerald most recently served as Chief Financial Officer (CFO) for Kymeta Corporation, a broadband satellite and cellular networks communication company, from 2021 to 2022.  Previously he was with FUJIFILM SonoSite, Inc. where he served as CFO from 2016 to 2021; and CFO of Fluke Networks, a Danaher operating company, from 2010 to 2016.  At Fluke he served as liaison with Danaher Corporate on business development, financial planning & forecasting, monthly reporting and business compliance. In 2015 he supported the sale and integration of the business to NetScout, Inc. as part of a larger $2.6 billion Danaher business divestiture.  He served as Vice President of Finance at Spiration, Inc. from 2008 to 2010.  While at Spiration he was responsible for all finance and treasury functions and lead the effort to build the necessary finance and operational infrastructure as the company transitioned from a development to a commercial business. He also provided due diligence in the sale of the company to Olympus Medical. Gerald holds a Masters of Business Administration from Northwestern University – Kellogg School of Management and a Bachelor of Arts Finance and Accounting from the University of Washington.

Gerald Ng and Data I/O Corporation signed an offer letter outlining the material employment arrangements which include: base salary of $275,000; participation in the Company’s Management Incentive Compensation Plan (“MICP”) and an incentive compensation target of $130,000; inducement grants of 75,000 Restricted Stock Units vesting annually over 4 years, and up to 7,500 shares of Performance Stock Units with the performance measure based upon Data I/O’s revenue growth during the period of 2023 through 2025 resulting in potential shares of 2,500 at threshold, 5,000 at target, and 7,500 at maximum.  The equity grants are made under or pursuant to the terms of the Data I/O Corporation 2023 Omnibus Incentive Compensation Plan.

Gerald entered into the Company’s standard Executive Agreement, Confidentiality and Non-Competition Agreement, and Indemnification Agreement.  A copy of the offer letter is furnished herewith as Exhibit 10.0 in this current report.

There were no arrangements or understandings pursuant to which Mr. Ng was selected as an officer. There were no related party transactions to report between Mr. Ng and the Company. 

Item 9.01 Financial Statements and Exhibits.

(d)                Exhibits

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.

Gerald Ng

June 1, 2023

Re: Offer of Employment

Dear Gerry,

Data I/O Corporation is pleased to make the following offer of employment to you, contingent on a satisfactory background check. We are offering you the position of Corporate Vice President, Finance, with a start date of July 1, 2023. Effective August 16, 2023 your title will become Corporate Vice President and Chief Financial Officer (CFO). This position reports directly to Anthony Ambrose, President & CEO.

Cash Compensation

The total cash compensation for this position is comprised of two major elements, an annual base salary of $275,000, and participation in our Management Incentive Compensation Program (MICP) at a rate of $130,000 at target. MICP is calculated at the end of the fiscal year.

Equity Compensation

Effective on the first day of the month following your first day of employment, inducement equity awards will be made to you pursuant to the terms of Data I/O’s 2023 Omnibus Incentive Compensation Plan. An award of 75,000 shares of Restricted Stock Units vesting annually over four years and 5,000 shares of Performance Stock Units with the performance measure based upon Data I/O’s revenue growth during the period of 2023 through 2025, will be granted to you.

Severance

Excluding any termination related to a change-in-control, if you are terminated without cause, you will receive a severance equal to six months of base salary paid out under our normal payroll practice.

Benefits

You will be eligible for all company benefit programs. Your life insurance benefits are effective on your first day of employment. Your medical, dental, and vision benefits are effective on the first day of the month following your date of employment. You will have 30 days after you begin work to choose the type of coverage you would like. You are able to begin contributing to the 401k plan upon hire and will be immediately eligible for the company match totaling 4% (100% of 1st 2% contributed and 50% of the next 4% contributed). You may participate in the ESPP (employee stock purchase plan).

This position is a public company Executive Officer role and is subject to the Securities Exchange Commission’s Section 16 rules. You will be covered by our Directors and Officers insurance coverage and our Indemnification Agreement. In addition, the Amended and Restated Executive Agreement (Executive Agreement), covering change-in-control provisions including base salary, average MICP earned severance provisions and $20,000 of outplacement services will be offered subject to entering into our standard executive Confidentiality and Non-Competition Agreement. Change-in-Control provisions for acceleration of equity vesting are covered in the equity plans. A copy of these agreements is also attached for your review.

Your employment will be governed by Washington law and is conditional upon execution of the above-mentioned agreements and completion of an I-9 form as well as satisfactory completion of background and reference checks. The travel demands of this position require you have a current U.S. Passport or other acceptable form of travel documentation. Your signature below indicates acceptance of this offer and that you represent that you are under no restrictions, contractual or otherwise, which would prevent you from accepting employment with Data I/O.

While this offer does not express or imply an employment contract between you and Data I/O for any specific period of time, we believe that the relationship will be productive and mutually beneficial. The terms and conditions outlined above are all of the terms and conditions of this offer and this offer will expire on June 5, 2023 at 12PM Pacific Time.

Please return one copy of this letter as soon as possible.

Gerry, we are excited to work with you and welcome you to Data I/O. We believe you can make a significant impact and look forward to you joining us.

Sincerely,

/s/Anthony Ambrose

Anthony Ambrose

President & CEO

Attachments:

1. Confidentiality and Non-Compete Agreement

2. Amended and Restated Executive Agreement

3. 2023 Omnibus Incentive Compensation Plan

==============================================================================

I am accepting this position based solely on the terms and conditions of employment described in this letter.

Accepted:

/s/ Gerald Y. Ng                                                                                       June 2, 2023              

Gerald Ng                                                                                                 Date Signed                              

Redmond, WA, June 30, 2023 – Data I/O Corporation (NASDAQ:DAIO), the leading global provider of advanced security and data deployment solutions for microcontrollers, security ICs and memory devices, announced that Gerald Ng will be joining the Company as Vice President of Finance with a start date of July 1, 2023. Effective August 16, 2023, he will become the Company’s Vice President and Chief Financial Officer.  Gerald brings a wealth of experience in finance and treasury functions, business development, financial planning & forecasting, monthly reporting and business compliance. Gerald was previously Chief Financial Officer for Kymeta Corporation, a broadband satellite and cellular networks communication company.  Gerald was CFO of FUJIFILM SonoSite, Inc. and prior to that CFO at Fluke Networks, a Danaher operating company, where he supported the sale of the business to NetScout, Inc.  He served as Vice President of Finance at Spiration, Inc. and was responsible for all finance and treasury functions and provided due diligence in the sale of the company to Olympus Medical.  Gerald holds a Masters of Business Administration from Northwestern University – Kellogg School of Management and a Bachelor of Arts Finance and Accounting from the University of Washington.

“We are thrilled to have Gerald join Data I/O,” said Anthony Ambrose, President and CEO of Data I/O Corporation. “Gerald comes to Data I/O with broad and deep CFO experience in related industries that will give him the necessary background and capabilities to help Data I/O achieve our strategic goals and advance the company to the next level on a global scale.”

“I am very pleased to join Data I/O at this exciting time in the company’s history,” said Gerald Ng. “I look forward to building on Data I/O’s strong tradition in finance and help drive growth in new areas.”

NASDAQ Required Equity Disclosure

Pursuant to NASDAQ rules, the initial equity compensation for Gerald Ng was approved by the Company’s Compensation Committee, consisting of only independent directors. They approved restricted stock unit and performance stock unit grants which were to be made as employment inducement grants included in his offer letter and consisted as follows:  inducement grants of 75,000 Restricted Stock Units vesting annually over 4 years, and up to 7,500 shares of Performance Stock Units with the performance measure based upon Data I/O’s revenue growth during the period of 2023 through 2025 resulting in potential shares of 2,500 at threshold, 5,000 at target, and 7,500 at maximum.  The equity grants are made under or pursuant to the terms of the Data I/O Corporation 2023 Omnibus Incentive Compensation Plan.  

About Data I/O Corporation

Since 1972, Data I/O has developed innovative solutions to enable the design and manufacture of electronic products for automotive, Internet-of-Things, medical, wireless, consumer electronics, industrial controls and other electronics devices. Today, our customers use Data I/O’s data programming solutions and security deployment platform to secure the global electronics supply chain and protect IoT device intellectual property from point of inception to deployment in the field.  OEMs of any size can program and securely provision devices from early samples all the way to high volume production prior to shipping semiconductor devices to a manufacturing line. Data I/O enables customers to reliably, securely, and cost-effectively bring innovative new products to life.  These solutions are backed by a portfolio of patents and a global network of Data I/O support and service professionals, ensuring success for our customers.  Learn more at dataio.com/Company/Patents.

Contact:

Data I/O Corporation

Jennifer Higgins

Marketing and Communications Manager

425-867-6922

higginj@dataio.com

Darrow Associates, Inc.

Jordan Darrow

(512) 551-9296

jdarrow@darrowir.com