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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Fourth Amended and Restated Employment Agreement with Vivek Gupta, Chief Executive
Officer and President.
On March 20, 2019, Mastech Digital, Inc. (the Company) entered into a Fourth Amended and Restated Executive
Employment Agreement (the Gupta Employment Agreement) with Vivek Gupta, the Companys Chief Executive Officer and President. The Gupta Employment Agreement amends and restates the Third Amended and Restated Executive Employment
Agreement, dated as of March 21, 2018, between the Company and Mr. Gupta in its entirety. The term of the Gupta Employment Agreement commenced on March 1, 2016 and may be terminated by either the Company or Mr. Gupta at any time.
The Gupta Employment Agreement provides that, effective April 1, 2019, Mr. Guptas base salary shall be $440,000 per year, subject to
review and modification annually by the Company. The Gupta Employment Agreement also provides that Mr. Gupta is eligible to earn an annual performance-based cash bonus of $240,000 for the achievement of certain financial and operational
targets. These targets, and the bonus dollars tied to such targets, will be determined by the Companys Board of Directors on an annual basis. Under the Gupta Employment Agreement, Mr. Gupta also received an award of a
non-qualified
stock option to purchase 100,000 shares of the Companys common stock pursuant to the Companys Stock Incentive Plan, with the option to purchase 50,000 of those shares vesting in five equal
annual installments beginning on January 16, 2020 and the option to purchase the remaining 50,000 shares earned upon the achievement of certain financial and operational targets. Under the Gupta Employment Agreement, Mr. Gupta is also
eligible to receive
non-qualified
stock options and other awards pursuant to the Companys Stock Incentive Plan in a manner and amount determined by the Compensation Committee of the Companys Board
of Directors.
In the event that Mr. Gupta is terminated with Cause, the Company may immediately cease payment of any further wages,
benefits or other compensation under the Gupta Employment Agreement other than salary and benefits (excluding options) earned through the date of termination. In the event that Mr. Gupta is terminated without Cause or he resigns for
Good Reason (in each case, other than within 12 months following a Change of Control of the Company), he is entitled to a severance equal to 12 months of his last monthly base salary (less appropriate deductions) that is
payable by the Company over a
12-month
period following his termination date, continued coverage under the Companys employee benefits and group health plans in accordance with the Companys
severance policy and payment of his annual performance-based cash bonus target (less appropriate deductions). Mr. Gupta is also entitled, for a
12-month
period following his termination date, to the
continued vesting of any outstanding unvested stock options he held on his termination date. The exercise period for vested options held by Mr. Gupta at the time of his termination will also be extended for a
six-month
period after the otherwise applicable expiration date, subject to certain restrictions.
In the event
that Mr. Gupta is terminated without Cause or he resigns for Good Reason, in each case within 12 months after a Change of Control of the Company, he is entitled to a lump sum severance payment (less
appropriate deductions) equal to two times the sum of (i) his average base salary for the three years preceding his termination (including the year of termination) and (ii) his average annual performance-based cash bonus received for the
three years preceding his termination (including the year of termination). Mr. Gupta is also entitled to the payment of the premiums required to continue coverage under the Companys employee benefits and group health plans for up to 24
months after his termination, the acceleration in full of the vesting and/or exercisability of all outstanding equity awards held by Mr. Gupta on his termination date and reimbursement of up to $25,000 for outplacement services. The exercise
period for vested options held by Mr. Gupta at the time of his termination will also be extended for a
six-month
period after the otherwise applicable expiration date, subject to certain restrictions.
Third Amended and Restated Employment Agreement with John J. Cronin, Jr., Chief Financial Officer.
On March 20, 2019, the Company entered into a Third Amended and Restated Executive Employment Agreement (the Cronin Employment Agreement)
with John J. Cronin, Jr., the Companys Chief Financial Officer. The Cronin Employment Agreement amends and restates the Second Amended and Restated Executive Employment Agreement, dated March 21, 2018, between the Company and
Mr. Cronin in its entirety. The term of the Cronin Employment Agreement continues from year to year or until Mr. Cronins employment is terminated by either party with or without cause under certain conditions.
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