Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On March 5, 2020, Art’s-Way Manufacturing Co., Inc. (the “Company”) entered into an offer letter (the “Offer Letter”) with David King, pursuant to which Mr. King is expected to assume the role of Chief Executive Officer upon the anticipated resignation of Carrie Gunnerson as Chief Executive Officer of the Company in the third quarter of fiscal year 2020. Mr. King’s anticipated start date is March 23, 2020 and he will serve in an interim role prior to assuming the role of Chief Executive Officer. The Company intends to enter into a formal employment agreement with Mr. King prior to his start date.
Mr. King, age 48, has a proven executive management track record with over 25 years in the agricultural industry. He is currently the Executive Vice President of Sales and Marketing at VES Environmental Solutions, LLC, a designer and manufacturer of energy-efficient agricultural ventilation and lighting systems, a position he has held since November 2019. He was previously Vice President of Sales and Marketing at Salford Group from June 2013 to November 2019, and he held roles in operations, marketing and international business development at Ag Leader Technology from 1996 to June 2013. Mr. King holds a B.S. in Business Administration from Iowa State University and an M.B.A. from Drake University.
Mr. King was not appointed pursuant to any arrangement or understanding with any person, and Mr. King does not have any family relationships with any directors or executive officers of the Company. Mr. King has not had a direct or indirect material interest in any transaction with the Company since December 1, 2017, nor is any such transaction currently proposed, that would be reportable under Item 404(a) of Regulation S-K.
The Offer Letter provides for an annual base salary of $265,000. Mr. King will also be eligible to receive annual cash incentive compensation of up to 75% of his base salary based on the Company’s achievement of annual financial objectives and to receive annual equity awards, each as granted by the Board (or a committee authorized by the Board). Mr. King will be eligible to participate in any and all other employee benefit plans that are generally available to the Company’s employees.
The Company intends to grant Mr. King 80,000 shares of restricted stock on his start date, with the risks of forfeiture for 20,000 shares lapsing immediately and the risks of forfeiture for the remaining 60,000 shares lapsing in increments of 20,000 shares on each of the first three anniversaries of the grant date.
This foregoing summary does not purport to be complete and is qualified in its entirety by reference to the text of the Offer Letter, a copy of which is attached hereto as Exhibit 10.1 and is incorporated herein by reference. A copy of the Company’s press release issued March 11, 2020, announcing Mr. King’s appointment, is attached hereto as Exhibit 99.1 and is incorporated herein by reference.