UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-K/A
(Amendment No. 1)
☒
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For fiscal year ended December 31, 2021
OR
☐
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from
to
Commission file number: 001-38358
INSEEGO CORP.
(Exact name of registrant as specified in its charter)
|
Delaware |
|
81-3377646 |
|
(State or Other Jurisdiction
of Incorporation or Organization)
|
|
(I.R.S. Employer
Identification No.)
|
| |
|
|
12600 Deerfield Parkway, Suite 100
Alpharetta, Georgia
|
|
30004 |
| (Address of Principal Executive
Offices) |
|
(Zip Code) |
Registrant’s telephone number, including area code:
(858) 812-3400
Securities registered pursuant to Section 12(b) of the
Act:
|
Title of each
class |
Trading Symbol(s) |
Name of each exchange on which
registered |
| Common
Stock, $0.001 par value |
INSG |
NASDAQ
Global Select Market |
| |
|
|
Securities registered pursuant to Section 12(g) of the
Act:
None
Indicate by check mark if the registrant is a well-known seasoned
issuer, as defined in Rule 405 of the Securities
Act. Yes ☒ No ☐
Indicate by check mark if the registrant is not required to file
reports pursuant to Section 13 or Section 15(d) of the
Act. Yes ☐ No ☒
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing
requirements for the past 90
days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted
electronically every Interactive Data File required to be submitted
pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter)
during the preceding 12 months (or for such shorter period that the
registrant was required to submit such
files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer, a
smaller reporting company, or an emerging growth company. See the
definitions of “large accelerated filer,” “accelerated filer,”
“smaller reporting company,” and “emerging growth company” in Rule
12b-2 of the Exchange Act.
| Large
Accelerated Filer |
|
☒ |
|
Accelerated
Filer |
|
☐ |
| |
|
|
|
| Non-accelerated Filer |
|
☐ |
|
Smaller Reporting
Company |
|
☐ |
| |
|
|
|
| |
|
|
|
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. ☐
Indicate by check mark whether the registrant has filed a report on
and attestation to its management’s assessment of the effectiveness
of its internal control over financial reporting under Section
404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the
registered public accounting firm that prepared or issued its audit
report. Yes ☒ No
☐
Indicate by check mark whether the registrant is a shell company
(as defined in Rule 12b-2 of the
Act). Yes ☐ No ☒
The aggregate market value of the voting common stock held by
non-affiliates of the registrant, based on the closing price of the
registrant’s common stock on June 30, 2021, as reported by The
Nasdaq Global Select Market, was approximately $853.3 million. For
the purposes of this calculation, shares owned by officers and
directors (and their affiliates) have been excluded. This exclusion
is not intended, nor shall it be deemed, to be an admission that
such persons are affiliates of the registrant. The registrant does
not have any non-voting common stock outstanding.
The number of shares of the registrant’s common stock outstanding
as of February 22, 2022 was 105,387,038.
DOCUMENTS INCORPORATED BY REFERENCE
None.
EXPLANATORY NOTE
This Amendment No. 1 (this “Amendment”) amends the Annual
Report on Form 10–K for the year ended December 31, 2021 of
Inseego Corp. (the “Company” or “Inseego”), filed with the
Securities and Exchange Commission (the “SEC”) on March 1, 2022
(the “Original Form 10–K”). The purpose of this Amendment is to
amend Part III, Items 10 through 14 of the Original Form 10-K to
include information previously omitted from the Original Form 10-K
in reliance on General Instruction G(3) to Form 10-K. Accordingly,
Part III of the Original Form 10-K is hereby amended and restated
as set forth below. The information included herein as required by
Part III, Items 10 through 14 of Form 10-K is more limited than
what is required to be included in the definitive proxy statement
to be filed in connection with our annual meeting of stockholders.
Accordingly, the definitive proxy statement to be filed at a later
date will include additional information related to the topics
herein and additional information not required by Part III, Items
10 through 14 of Form 10-K. In addition, because the Company was a
smaller reporting company, as defined by Rule 12b-2 of the
Securities Exchange Act of 1934, as amended, for the fiscal year
ended December 31, 2021 and is transitioning into large accelerated
filer status, certain disclosures contained in this Amendment
conform to the smaller reporting company requirements.
The reference on the cover page of the Original Form 10-K to the
incorporation by reference of our definitive proxy statement into
Part III of the Original Form 10-K is hereby deleted.
In addition, as required by Rule 12b–15 under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), new
certifications by our principal executive officer and principal
financial officer are filed as exhibits to this Amendment under
Item 15 of Part IV hereof. Because no financial statements have
been included in this Amendment and this Amendment does not contain
or amend any disclosure with respect to Items 307 and 308 of
Regulation S-K, paragraphs 3, 4 and 5 of the certifications have
been omitted.
Except as stated herein, this Amendment does not reflect events
occurring after the filing of the Original Form 10-K with the SEC
on March 1, 2022 and no attempt has been made in this Amendment to
modify or update other disclosures as presented in the Original
Form 10–K.
PART III
| Item 10. |
Directors, Executive Officers and Corporate
Governance |
The Company’s Board of Directors (the “Board”) currently consists
of six members, five of whom are non-management directors. The
Board is divided into three classes with each class serving a
three-year term. The term of one class expires at each annual
meeting of stockholders of the Company. The Board is comprised of
the following members:
| James B. Avery |
|
Director since August
2018 |
Mr. Avery, age 58, was appointed to the Board in August 2018
pursuant to the terms of that certain Securities Purchase
Agreement, dated August 6, 2018, by and among the Company, North
Sound Trading, L.P. and Golden Harbor Ltd. (the “Purchase Agreement
Mr. Avery joined Tavistock Group in July 2014 and is currently a
Senior Managing Director. From 2003 to June 2014, Mr. Avery was a
Managing Director and Co-Founder of GCA Savvian, a boutique
investment bank, in addition to holding the position of
Representative Director for GCA Corporation, GCA Savvian’s parent
company publicly traded on the Tokyo Stock Exchange. Prior to GCA
Savvian, Mr. Avery spent 10 years at Morgan Stanley, working in the
New York and Silicon Valley offices where he advised clients across
a number of industries on strategic, merger & acquisitions and
capital market transactions. Mr. Avery has also held roles at
Edward M. Greenberg Associates, Burson-Marsteller, Westdeutsche
Landesbank, and Republic National Bank of New York. Mr. Avery is
currently a member of the board of directors of FrontWell Capital
Partners. Mr. Avery received his Bachelor of Science in Finance
from Miami University. Mr. Avery’s management background and
expertise in strategic corporate matters and capital markets
provide a valuable background for him to serve as a member of our
Board, as Chairman of our Nominating and Corporate Governance
Committee, and as a member of the Compensation and Audit
Committees. Mr. Avery’s term as a director will expire at the 2023
annual meeting of stockholders of the Company.
| Stephanie Bowers |
|
Director since June
2021 |
Ms. Bowers, age 42, was appointed to the Board in June 2021. Ms.
Bowers has two decades of U.S. government experience at the White
House and with the U.S. Department of State. Ms. Bowers led the
U.S. Embassy in The Bahamas as Chargé d’Affaires from 2018 to 2020.
Prior to that, Ms. Bowers held senior positions in both Democratic
and Republican administrations, including serving as chief of staff
for the Western Hemisphere at the State Department from 2016 to
2018, as Deputy Director of Central America Affairs at the State
Department from 2015 to 2016 and as a National Security Council
Director at the White House from 2013 to 2014. Her previous foreign
service experience includes acting as an Economic Officer in South
Africa and Spain and overseeing some of the U.S. government’s
largest foreign assistance initiatives and budgets, including in
the Middle East and throughout the Americas and the Caribbean.
Ms. Bowers received bachelor degrees in International Affairs and
French Language and Literature from The George Washington
University. She received a Master of Science degree in National
Security Strategy from the National War College, where she was
named Distinguished Graduate. Ms. Bowers’ substantial experience in
the international relations and government affairs provide valuable
perspective and expertise as a member of our Board. Ms. Bowers’s
term as a director will expire at the 2022 annual meeting of
stockholders of the Company.
| Christopher Harland |
|
Director since October
2019 |
Mr. Harland, age 64, was appointed to the Board in October 2019.
Mr. Harland is a Partner in the Strategic Advisory Group at PJT
Partners, based in New York. Prior to joining PJT Partners, Mr.
Harland spent 32 years at Morgan Stanley. From 2008 to March 2015,
Mr. Harland served as Chairman and Regional Head of Morgan Stanley
Latin America and was also a member of the Management Committee and
International Operating Committee. Under his leadership, Morgan
Stanley significantly expanded the scope of its operations in
Brazil and Mexico and opened new offices in Peru, Colombia and
Chile. Before assuming responsibility for Latin America, Mr.
Harland was Global Head of the Media and Communications Investment
Banking Group from 1996 to 2007. In this capacity he advised many
leading media and communications companies on a variety of
acquisitions, divestitures and corporate financings. He is a
trustee of the New York Studio School, a director of Round Hill
Developments and a member of the Council on Foreign Relations. Mr.
Harland graduated magna cum laude from Harvard College, attended
Oxford University and received an MBA from Harvard Business School
where he was a George F. Baker Scholar. Mr. Harland’s experience
with international expansion and expertise in capital markets
provide a valuable background for him to serve as a member of our
Board, and as a member of the Audit Committee. Mr. Harland’s term
as a director will expire at the 2024 annual meeting of
stockholders of the Company.
| Christopher Lytle |
|
Director since October
2020 |
Mr. Lytle, age 52, was appointed to the Board in October 2020. Mr.
Lytle has been president of Longfellow Capital, a private
investment firm, since January 2009. He served in a consulting
capacity as the Company’s Head of Government Affairs from April
2020 to October 2020 and has been providing strategic consulting
services to the Company since 2018. Mr. Lytle previously served as
the Company’s Chief Strategy Officer and Executive Vice President
of Enterprise SaaS Solutions from August 2017 to October 2018.
Prior to joining the Company, Mr. Lytle was President of Cavulus, a
privately-held SaaS-based technology provider in the healthcare
industry. Before joining Cavulus, Mr. Lytle was a Managing Director
at Morgan Stanley from July 2006 to December 2008 and previously
was Lead Portfolio Manager of RCL Capital, a hedge fund focused on
small and mid-cap telecom and wireless technology businesses from
July 2006 to December 2008. He also recently became Chairman of
Prolifiq, a leading cloud-native provider of sales- enablement
applications to Salesforce customers. Mr. Lytle holds a Bachelor of
Arts degree in Economics from Lafayette College. Mr. Lytle’s
knowledge of the Company and experience with enterprise SaaS
software solutions provide valuable background for him to serve as
a member of our Board. Mr. Lytle’s term as a director will expire
at the 2024 annual meeting of stockholders of the Company.
| Dan Mondor |
|
Director since June 2017
Chairman of the Board since August 2018
Executive Chairman since March 2022
|
Mr. Mondor, age 66, has served as the Company’s Executive Chairman
since March 2022. Mr. Mondor served as the Company’s Chief
Executive Officer and Chairman of the Board from August 2018 to
March 2022. Mr. Mondor served as Chief Executive Officer of the
company from June 2017 until August 2018, when he was appointed to
serve as Chairman of the Board. Prior to joining the Company, from
April 2016 to June 2017, Mr. Mondor provided corporate strategy and
merger and acquisition advisory services to companies involved in
the telecommunications industry through his private consulting
firm, The Mondor Group, LLC. From March 2015 to March 2016, he was
President and Chief Executive Officer of Spectralink Corporation, a
private equity-owned global company that designs and manufactures
mobile-workforce telecommunications products, including Android
based industrial WiFi devices, for global enterprises. From April
2008 to November 2014, Mr. Mondor was the President and Chief
Executive Officer of Concurrent Computer Corporation, a global
company that designs and manufactures IP video delivery systems and
real-time Linux based software solutions for the global services
provider, military, aerospace and financial services industries.
From February 2007 to March 2008, he was President of Mitel
Networks, Inc., a subsidiary of Mitel Networks Corporation, a
global company that designs and manufactures business
communications systems and mobile communications technology that
serve the enterprise and wireless carrier markets. Prior to that,
Mr. Mondor held a number of executive management positions at
Nortel Networks, including Vice President and General Manager of
Enterprise Network Solutions and Vice President of Global Marketing
for Nortel’s Optical Internet business. Mr. Mondor holds a Master
of Science degree in Electrical Engineering from the University of
Ottawa and a Bachelor of Science degree in Electrical Engineering
from the University of Manitoba. Mr. Mondor’s substantial
experience in the telecommunications and technology industries,
gained from senior executive positions at leading global
corporations, and his unique understanding of our operations,
opportunities and challenges, provide a relevant and informed
background for him to serve as a member of our Board. Mr. Mondor’s
term as a director will expire at the 2022 annual meeting of
stockholders of the Company.
| Jeffrey Tuder |
|
Director since June
2017 |
Mr. Tuder, age 49, was appointed to the Board in June 2017. Mr.
Tuder is the Founder and Managing Member of Tremson Capital
Management, LLC since April 2015. Mr. Tuder is also Chief Executive
Officer of Concord Acquisition Corp. Prior to founding Tremson, he
held investment roles at KSA Capital Management, LLC from 2012
until April 2015 and at JHL Capital Group, LLC during 2011. From
2007 until 2010, Mr. Tuder was a Managing Director of CapitalSource
Finance, LLC, where he analyzed and underwrote special situation
credit investments in the leveraged loan and securitized bond
markets. From 2005 until 2007, Mr. Tuder was a member of the
private equity investment team at Fortress Investment Group, LLC .
Mr. Tuder began his career in various investment capacities at
Nassau Capital, a private investment firm that managed the private
portion of Princeton University’s endowment and ABS Capital
Partners, a private equity firm affiliated with Alex Brown &
Sons. Mr. Tuder currently serves on the board of directors of
SeaChange International Inc. (NASDAQ: SEAC) and Unico American
(NASDAQ: UNAM). Mr. Tuder previously served on the board of
directors of MRV Communications, Inc., a communications equipment
and services company, until August 2017 prior to its sale to Adva
Optical Networking. Mr. Tuder also serves as a director of a number
of privately held companies. Mr. Tuder received a Bachelor of Arts
degree from Yale College. Mr. Tuder’s private equity and hedge fund
investment experience, his expertise in evaluating both public and
private investment opportunities across numerous industries, and
his ability to think creatively in considering ways to maximize
long-term shareholder value provide a valuable background for him
to serve as a member of our Board, as Chair of our Audit Committee,
Chair of the Compensation Committee of the Board (the “Compensation
Committee”), and as a member of the Nominating and Corporate
Governance Committee of the Board (the “Nominating and Corporate
Governance Committee”). Mr. Tuder’s term as a director will expire
at the 2023 annual meeting of stockholders of the
Company.
Board Committees
The Board currently has three standing committees: an Audit
Committee, a Compensation Committee and a Nominating and Corporate
Governance Committee. Each committee operates under a written
charter adopted by the Board. All of the charters are publicly
available on our website at investor.inseego.com under
“Governance.” You may also obtain a copy of these charters upon
sending a written request to our Secretary at our principal
executive offices.
Upon the recommendation of the Nominating and Corporate Governance
Committee, the Board appoints committee members annually.
The table below sets forth the current composition of our Board
committees:
|
Name
|
|
Audit
Committee |
|
Compensation
Committee |
|
Nominating and
Corporate
Governance
Committee |
| James
B. Avery |
|
✓ |
|
✓ |
|
☑ |
| Stephanie Bowers |
|
|
|
|
|
✓ |
| Christopher Harland |
|
✓ |
|
|
|
|
| Jeffrey Tuder |
|
☑ |
|
☑ |
|
✓ |
______________________________
☑
Chair ✓
Member
Audit Committee
The Audit Committee oversees our accounting and financial reporting
processes and the audits of our financial statements and internal
control over financial reporting.
The functions and responsibilities of the Audit Committee
include:
| |
• |
|
engaging our independent registered public
accounting firm and conducting an annual review of the independence
of that firm; |
| |
• |
|
reviewing with management and the independent
registered public accounting firm the scope and the planning of the
annual audit; |
| |
• |
|
reviewing the annual audited financial statements
and quarterly unaudited financial statements with management and
the independent registered public accounting firm; |
| |
• |
|
reviewing the findings and recommendations of the
independent registered public accounting firm and management’s
response to the recommendations of that firm; |
| |
• |
|
discussing with management and the independent
registered public accounting firm, as appropriate, the Company’s
policies with respect to financial risk assessment and financial
risk management; |
| |
• |
|
overseeing compliance with applicable legal and
regulatory requirements, including ethical business
standards; |
| |
• |
|
establishing procedures for the receipt,
retention and treatment of complaints received by the Company
regarding accounting, internal accounting controls or auditing
matters; |
| |
• |
|
establishing procedures for the confidential,
anonymous submission by employees of concerns regarding
questionable accounting or auditing matters; |
| |
• |
|
preparing the Audit Committee Report to be
included in our annual proxy statement; |
| |
• |
|
monitoring ethical compliance, including review
of related party transactions; and |
| |
• |
|
periodically reviewing the adequacy of the Audit
Committee charter. |
Our independent registered public accounting firm reports directly
to the Audit Committee. Each member of the Audit Committee must
have the ability to read and understand fundamental financial
statements and at least one member must have past employment
experience in finance or accounting, and the requisite professional
certification in accounting or another comparable experience or
background. The Board has determined that each member of the Audit
Committee is “independent” as defined by the NASDAQ Stock Market
LLC (“NASDAQ”) listing requirements and SEC rules. The Board has
also determined that Mr. Tuder, the Chair of the Audit
Committee, meets the requirements of an “audit committee financial
expert” as defined by SEC rules.
Compensation Committee
The Compensation Committee establishes, administers and oversees
compliance with our policies, programs and procedures for
compensating our executive officers and the Board.
The functions and responsibilities of the Compensation Committee
include:
| |
• |
|
establishing and reviewing our general
compensation policies and levels of compensation applicable to our
executive officers and
our non-management directors; |
| |
• |
|
evaluating the performance of, and determining
the compensation for, our executive officers, including our Chief
Executive Officer; |
| |
• |
|
reviewing regional and industry-wide compensation
practices in order to assess the adequacy and competitiveness of
our executive compensation programs; |
| |
• |
|
administering our employee benefits plans,
including approving awards of stock, restricted stock units
(“RSUs”) and stock options to employees and other parties under our
equity incentive compensation plans; and |
| |
• |
|
periodically reviewing the adequacy of the
Compensation Committee charter. |
The Board has determined that each member of the Compensation
Committee is “independent” as defined by the NASDAQ listing
requirements and SEC rules.
The Compensation Committee has the sole authority to retain and
supervise one or more outside advisors, including outside counsel
and consulting firms, to advise the Compensation Committee on
executive and director compensation matters and to terminate any
such adviser. In addition, the Compensation Committee has the sole
authority to approve the fees of an outside adviser and other terms
of such adviser’s retention by the Company.
Nominating and Corporate Governance Committee
The Nominating and Corporate Governance Committee considers,
evaluates and nominates director candidates, including the members
of the Board eligible for re-election and the recommendations
of potential director candidates from stockholders.
The functions and responsibilities of the Nominating and Corporate
Governance Committee include:
| |
• |
|
developing and recommending a set of corporate
governance guidelines applicable to the Company; |
| |
• |
|
identifying and evaluating candidates to serve on
the Board, including determining whether incumbent directors should
be nominated for re-election to the Board, and reviewing and
evaluating director nominees submitted by stockholders; |
| |
• |
|
reviewing possible conflicts of interest of
prospective Board members; |
| |
• |
|
recommending director nominees; |
| |
• |
|
establishing procedures and guidelines for
individuals to be considered to become directors; |
| |
• |
|
recommending the appropriate size and composition
of the Board and each of its committees; |
| |
• |
|
overseeing periodic evaluations of the
performance of the Board, the Board committees and the
directors; |
| |
• |
|
monitoring the continued legal compliance of our
established principles and policies; and |
| |
• |
|
periodically reviewing the adequacy of the
Nominating and Corporate Governance Committee charter. |
The Board has determined that each member of the Nominating and
Corporate Governance Committee is “independent” as defined by the
NASDAQ listing requirements.
Other Information Regarding Our Board of Directors and its
Committees
There are no family relationships among any of our directors and/or
executive officers. There are currently no legal proceedings, and
during the past 10 years there have been no legal proceedings, that
are material to the evaluation of the ability or integrity of any
of our directors.
Advisory Board
In 2021, the Board established an Advisory Board to enhance the
Company’s strategic development, acquire additional expertise of
industry leaders, and enable former members of the Board or the
Company’s management to continue to make significant contributions
to the Company. One of our former directors, Brian Miller,
currently serves as a member of the Advisory Board.
Compensation Committee Interlocks and Insider
Participation
Messrs. Avery and Tuder served on our Compensation Committee during
2021. None of the members of our Compensation Committee during 2021
has ever been one of our officers or employees. None of our
executive officers currently serves, or has served during the last
completed fiscal year, as a member of the board of directors or
compensation committee of any entity that has one or more executive
officers serving as a member of our Bboard or Compensation
Committee.
Securities Trading Policy/Hedging Prohibition
Directors, officers and other employees may not engage in any
transaction in which they may profit from short-term speculative
swings in the value of the Company’s securities. This includes
“short sales” (selling borrowed securities which the seller hopes
can be purchased at a lower price in the future) or “short sales
against the box” (selling owned, but not delivered securities),
“put” and “call” options (publicly available rights to sell or buy
securities within a certain period of time at a specified price)
and hedging transactions, such as zero-cost collars and forward
sale contracts. In addition, this policy is designed to ensure
compliance with all insider trading rules.
Information about our Executive Officers
The following table sets forth certain information with respect to
our current executive officers as of April 30, 2022:
|
Executive
|
|
Age |
|
Title |
| Ashish Sharma |
|
49 |
|
Chief
Executive Officer & President |
| Robert Barbieri |
|
66 |
|
Chief
Financial Officer |
| Doug
Kahn |
|
63 |
|
Executive Vice President, Operations |
Ashish Sharma has served as the Company’s Chief
Executive Officer and President since March 2022. He previously
served as the Company’s President from June 2021 to March 2022 and
as President of IoT & Mobile Solutions from February 2020 to
June 2021. Prior to that, he had served as the Company’s Executive
Vice President IoT & Mobile Solutions since joining the Company
in September 2017. Prior to joining the Company, Mr. Sharma was
Chief Marketing Officer at Spectralink Corporation, a provider of
enterprise grade mobile solutions, from December 2015 to September
2017. Prior to that, Mr. Sharma served as Senior Vice President and
General Manager, Americas for Graymatics, Inc. a cognitive media
processing company, from January 2015 to December 2015 and as Chief
Marketing Officer at FreeWave Technologies, an industrial wireless
networking company, from November 2010 to January 2015. Mr. Sharma
holds a Bachelor of Science in Electrical Engineering from the
University of District of Columbia, a Master of Science in
Electrical Engineering from George Mason University and an MBAMBA
from the UCLA Anderson School of Management in Finance, Marketing
and Strategy.
Robert Barbieri has served as the Company’s Chief Financial
Officer since October 2021, and served as the Company’s interim
Chief Financial Officer from April 2021 to October 2021. He was a
Partner with TechCXO, LLC (“TechCXO”), a professional services firm
that provides experienced, C-Suite professionals to deliver
strategic and functional consulting services, from 2019 to 2021.
Before joining TechCXO, Mr. Barbieri led his own firm, CxO Advisory
Services, which provided similar strategic and functional
consulting services, from 2010 to 2019. Mr. Barbieri has more than
30 years of experience as a senior executive, strategic partner,
and management advisor. Mr. Barbieri has served in senior financial
leadership positions with a number of companies, including Chief
Financial Officer at ABILITY Network, Inc., a leading healthcare
technology company; Chief Financial Officer at Converge One, a
leader in telecommunication technology; Executive Vice President
and Chief Financial Officer at TriZetto, a publicly traded
healthcare IT company; Chief Financial Officer at Textura, a cloud
collaboration company; Chief Financial Officer at Apogee
Enterprises, a publicly traded glass and coatings technologies
company; Chief Financial and Performance Officer at Lawson
Software, Inc., a publicly traded international technology,
software and e-commerce solution company; and a senior executive
with Air Products, a global manufacturing and services company. Mr.
Barbieri is a Certified Management Accountant and holds both a B.S.
in Business Administration and Accounting and an MBA in Financial
Management from Drexel University.
Doug Kahn joined the Company in February 2019 as Executive
Vice President of Operations. Prior to joining the Company, Mr.
Kahn was Vice President of Global Supply Chain at Vispero, Inc., a
provider of assistive technology solutions for the visually
impaired, from 2018 to 2019. Mr. Kahn was Executive Vice President
of Global Operations and Customer Support for Tintri, Inc., a
virtualized storage and storage company from 2014 to 2018. Prior to
that, he was Vice President of Global Purchasing and Vice President
of Operations for TomTom International BV, a global GPS company,
from 2012 to 2014. Mr. Kahn has held several additional leadership
roles in all major supply chain functions, including Vice President
of Supply Chain and IT for Synaptics Inc. Earlier in his career,
Mr. Kahn spent 17 years with Hewlett Packard in roles of increasing
responsibility in supply chain development and operations. Mr. Kahn
earned a Bachelor of Arts from the University of California,
Berkeley, an Master of Science in Geophysics and an MBA in finance
and statistics from the University of Chicago.
There are no family relationships among any of our executive
officers and/or directors. There are currently no legal
proceedings, and during the past 10 years, there have been no legal
proceedings, that are material to the evaluation of the ability or
integrity of any of our current executive officers.
Code of Conduct and Ethics
The Board has adopted a Code of Conduct and Ethics that is
applicable to all of our directors, officers and employees. The
purpose of the Code of Conduct and Ethics is to, among other
things, focus our directors, officers and employees on areas of
ethical risk, provide guidance to help them recognize and deal with
ethical issues, provide mechanisms to report concerns
regarding possible unethical or unlawful conduct and to help
enhance and formalize our culture of integrity, respect and
accountability. We distribute copies of the Code of Conduct and
Ethics to, and conduct periodic training sessions regarding its
content for, our newly elected directors and newly hired officers
and employees. We will post information regarding any amendment to,
or waiver from, our Code of Conduct and Ethics on our website in
the Investors tab under “Governance” as required by applicable law.
A copy of our Code of Conduct and Ethics is available on our
website at investor.inseego.com under “Governance”.
| Item 11. |
Executive Compensation |
Compensation Discussion and Analysis for Named Executive
Officers
The following Compensation Discussion and Analysis describes the
material elements of compensation for the Company’s named executive
officers, which consist of: (1) our Executive Chairman and former
Chief Executive Officer, (2) our President and Chief Executive
Officer, (3) our Chief Financial Officer, (4) our Executive Vice
President of Operations, (5) our former Chief Financial Officer,
and (6) our Vice President and Corporate Controller, who served as
our principal financial officer and principal accounting officer
for a portion of 2021.
Objectives of Compensation Program
The primary objectives of the Company’s compensation program,
including our executive compensation program, are to maintain a
pay-for-performance compensation program that will fairly
compensate our executives and employees, attract and retain
qualified executives and employees who are able to contribute to
our long-term success, induce performance consistent with clearly
defined corporate goals and align our executives’ long-term
interests with those of our stockholders. To that end, the
Company’s compensation practices are intended to:
| |
• |
|
provide overall compensation (assuming that
targeted levels of performance are achieved) that is sufficient to
attract and retain executives and key employees; |
| |
• |
|
tie
total compensation to Company performance and individual
performance in achieving financial and non-financial objectives;
and |
| |
• |
|
closely align senior management’s interests with
stockholders’ interests through long-term equity incentive
compensation. |
How the Compensation Committee Determines the Forms and Amounts
of Compensation
The Compensation Committee structures our compensation programs and
establishes compensation levels for our executives and senior
officers. The Compensation Committee annually determines the
compensation levels for our executive officers by considering
several factors, including competitive market data, each executive
officer’s roles and responsibilities, how the executive officer is
performing those responsibilities and our historical financial
performance.
The Compensation Committee considers the recommendations from our
Chief Executive Officer in determining executive compensation. In
making his recommendations, the Chief Executive Officer receives
input from our Human Resources Department.
The Compensation Committee makes all decisions for the total direct
compensation, which includes base salary, bonus compensation based
upon annual incentive goals and objectives and long-term
stock-based awards, of the Company’s executive officers and other
members of the Company’s senior management team, including the
named executive officers.
The Compensation Committee engages independent compensation
consultants from time-to-time to assist the Compensation Committee
in its duties, including providing advice regarding industry trends
relating to the form and amount of compensation provided to
executives by companies with which we compete for executive talent
and other similarly situated companies. The Compensation Committee
retained Compensia during 2021 to provide competitive compensation
data and analysis. The Compensation Committee considers available
market data as one factor in making executive compensation
decisions, but has not adopted a specific benchmark or peer group
as a guideline in its determination of compensation.
The Compensation Committee annually reviews and approves corporate
goals and objectives relevant to the Chief Executive Officer’s
compensation, evaluates the Chief Executive Officer’s performance
in light of those goals and objectives, and determines the Chief
Executive Officer’s compensation levels based on this evaluation.
In determining the long-term incentive component of the Chief
Executive Officer’s compensation, the Committee considers corporate
performance, the impact of incentive awards on the Chief Executive
Officer’s total compensation and the awards given to the Chief
Executive Officer in past years. For the other named executive
officers, the Compensation Committee receives a performance
assessment and compensation recommendation from the Chief Executive
Officer and also exercises its judgment based on the Board’s
interactions with the named executive officers. As with the Chief
Executive Officer, the performance evaluation of these executives
is based on his or her contributions to the Company’s performance
and other leadership accomplishments.
Components of Executive Compensation
The elements of the Company’s compensation program are base
salaries, bonus compensation based upon incentive goals and
objectives and stock-based equity awards. Our compensation program
is designed to balance our need to provide our named executive
officers with incentives to achieve our short- and long-term
performance goals with the need to pay competitive base salaries.
There is no pre-established policy for allocating between cash and
non-cash or short-term or long-term compensation. Each named
executive officer’s current and prior compensation is considered in
setting future compensation.
Base Salaries. Base salary is the guaranteed element of
employees’ annual cash compensation. Base salaries are generally
based on relative responsibility and are targeted to provide
competitive guaranteed cash compensation. The value of base
salary reflects the employee’s long-term performance, skill set and
the market value of that skill set. Base salaries for our named
executive officers are reviewed on an annual basis and adjustments
are made to reflect performance-based factors, as well as
competitive conditions. The Company does not apply specific
formulas to determine increases. In setting base salaries, the
Compensation Committee considers the following factors:
| |
• |
|
The
Company’s overall financial condition; |
| |
• |
|
Internal relativity, meaning the relative pay
differences for different job levels; |
| |
• |
|
Individual performance; |
| |
• |
|
Overall economic conditions and market factors;
and |
| |
• |
|
Consideration of the mix of overall
compensation. |
In June 2021, the Compensation Committee increased the base salary
of Mr. Sharma in connection with his promotion to President of
Inseego Corp. Mr. Sharma’s base salary was again increased in March
2022 in connection with his appointment as Chief Executive Officer.
These decisions were based upon Mr. Sharma’s increase in
responsibilities, salary history and internal relativity.
In June 2021, the Compensation Committee also increased the base
salary of Mr. Kahn based upon his individual performance
contributions, salary history and internal relativity, as well as
consideration of overall market conditions.
Mr. Barbieri’s 2021 base salary was established in October 2021 at
the time of his commencement of employment with us based on the
Compensation Committee’s consideration of the factors described
above.
The fiscal 2021 base salaries for each of the named executive
officers are shown in the following table.
| |
|
2021 Base |
|
|
Name |
|
Salary (1) |
|
| Ashish Sharma |
|
$ |
400,000 |
|
| Robert
Barbieri |
|
$ |
400,000 |
|
| Doug
Kahn |
|
$ |
325,000 |
|
| Dan
Mondor |
|
$ |
550,000 |
|
| Craig
Foster |
|
$ |
375,000 |
|
| Wei
Ding |
|
$ |
250,000 |
|
| (1) |
Reflects base salaries effective December 31,
2021. |
Annual Incentive Bonuses
The Company believes that as an employee’s level of responsibility
increases, a greater portion of the individual’s cash compensation
should be variable and linked to both quantitative and qualitative
expectations, including key financial, operational and strategic
metrics. To that end, the Company awards annual bonuses in order to
align employees’ goals with the Company’s financial, strategic and
tactical objectives for the current year.
Executive Bonuses for 2021. For 2021, the Compensation
Committee established the Senior Management Bonus Program for the
year ended December 31, 2021 (the “2021 Bonus Program”). Under
the 2021 Bonus Program, bonus target amounts, expressed as a
percentage of base salary, were established for participants. Bonus
payouts for the year were then determined by (a) the
achievement by the Company of certain financial goals and/or
targets set forth in the 2021 Bonus Program related to the
Company’s revenue performance and cash flow; and (b) each
participating employee’s individual performance. Satisfactory
individual performance is a condition to payment.
The Compensation Committee considered the following when
establishing the awards for 2021:
| |
• |
|
Bonus Targets. Target bonuses are
expressed as a percentage of the participant’s base salary earned
during the plan year. Bonus targets were based on job
responsibilities and internal relativity. Consistent with the
Company’s executive compensation policy, individuals with greater
job responsibilities had a greater proportion of their total
compensation tied to Company performance in the 2021 Bonus Program.
With the exception of Mr. Mondor, bonus targets for the named
executive officers were unchanged for 2021 compared to prior years.
Prior to 2021, Mr. Mondor had an annual target bonus equal to 65%
of his annual base salary. In addition, he had the potential to
receive up to an additional 65% of his base salary (for an
aggregate annual bonus of up to 130% of his annual base salary)
upon the achievement of certain “stretch goals” established by the
Compensation Committee from time-to-time. For 2021, Mr. Mondor’s
target bonus was set at 130% based upon the same goals as
applicable to the rest of the management team. The schedule below
shows the target incentives for the 2021 awards for each of the
named executive officers as a percentage of 2021 base
salary: |
| |
|
Target Bonus |
|
|
2021 Bonus |
|
|
Name |
|
% of Salary |
|
|
Dollars |
|
|
Earned
(1) |
|
| Ashish Sharma |
|
|
50% |
|
|
$ |
200,000 |
|
|
$ |
270,000 |
|
| Robert Barbieri |
|
|
50% |
|
|
$ |
200,000 |
|
|
$ |
225,000 |
|
| Doug Kahn |
|
|
40% |
|
|
$ |
120,000 |
|
|
$ |
200,000 |
|
| Dan Mondor |
|
|
130% |
|
|
$ |
715,000 |
|
|
$ |
950,000 |
|
| Craig Foster |
|
|
50% |
|
|
$ |
187,500 |
|
|
$ |
63,094 |
(2) |
| Wei Ding |
|
|
25% |
|
|
$ |
62,500 |
|
|
$ |
110,000 |
|
________________________
| (1) |
Bonuses were
paid in March 2022 in the form of fully vested shares based upon
Company and individual performance during 2021, except for Mr.
Foster, who received a cash payment. Represents the aggregate bonus
amount payable to each named executive officer, which is also the
grant date fair value of the fully vested shares granted in
satisfaction of such bonuses as computed in accordance with ASC
Topic 718, excluding the effect of estimated
forfeitures. |
| (2) |
For Mr. Foster, the 2021 bonus
award is pro-rated to reflect the portion of the year for which he
was employed. |
| |
• |
|
Company performance measures. For all
participants in the 2021 Bonus Program, including the named
executive officers, the Compensation Committee established
performance measures based upon total revenue, cash flow and
specific product line revenues. Payouts could range from zero to
160% of target depending on the Company’s performance. The bonuses
earned by the named executive officers for 2021 relating to
corporate performance were 135% of target as a result of achieving
sales in excess of the established target for 2021. |
| |
• |
|
Personal performance. Based on individual
performance, the Compensation Committee uses its discretion to
adjust bonus payouts – either up or down – to reflect the
individual performance of each named executive officer during the
year. |
Long-Term Incentives. Long-term incentive awards are a key
element of the Company’s total compensation package for the named
executive officers. We also have adopted an equity incentive
approach intended to reward longer-term performance and to help
align the interest of our named executive officers with those of
our stockholders. We believe that long-term performance is achieved
through an ownership culture that rewards performance by our named
executive officers through the use of equity incentives. Our equity
incentive plans have been established to provide our employees,
including our named executive officers, with incentives to help
align those employees’ interests with the interests of our
stockholders. Our equity incentive plans have provided the
principal method for our named executive officers to acquire equity
interests in the Company.
The size and terms of the awards for an individual recipient will
depend upon the level of responsibility of the recipient; the
expected future contributions to the growth and development of the
Company; the value of past service; and the number of options and
restricted shares owned by other executives in comparable positions
within the Company. The Company’s 2018 Stock Incentive Plan
provides for a variety of long-term awards including stock options,
restricted stock, restricted share units and performance
awards.
Stock Options and RSU Awards
The Compensation Committee continually evaluates its equity
compensation program to determine whether to issue either
restricted stock units (“RSUs”), stock options or a combination
thereof. In making such determinations, the Compensation Committee
considers the accounting treatment, the retention and the number of
shares available for grant under the Company’s equity incentive
plan and the potential dilutive impact on the Company’s
stockholders.
The Compensation Committee primarily relies on stock options as the
main equity vehicle for our named executive officers. Stock options
provide for financial gain derived from the potential appreciation
in stock price from the date that the option is granted until the
date that the option is exercised. The grant date is established
when the Compensation Committee approves the grant and all key
terms have been determined. The exercise price of stock option
grants is set at the fair market value on the date of grant, which
is the closing price on the NASDAQ Stock Market. Under the
stockholder-approved 2018 Stock Incentive Plan, the Company may not
grant stock options at a discount to the fair market value or
reduce the exercise price of outstanding options, except with the
approval of the stockholders or except in the case of a stock split
or other similar event. The Company does not grant stock options
with “reload” features and it does not loan funds to employees to
enable them to exercise stock options.
From time to time, our Compensation Committee may also issue RSUs
to our named executive officers. RSUs are generally less dilutive
to our stockholders, as fewer shares of our common stock are
granted to achieve an equivalent value relative to stock options,
and because RSU awards are an effective retention tool that
maintain value even in cases where the share price is trading lower
than the initial grant price.
The equity awards granted to our named executive officers during
2021 are reflected in the “Grants of Plan-Based Awards Table”
below.
Other Elements of Compensation
Perquisites and Other Benefits. The Company does not provide
significant perquisites or personal benefits to our named executive
officers. Our named executive officers are eligible to participate
in our health and welfare plans to the same extent as all full-time
employees generally.
Retirement Plans. We currently maintain a 401(k) retirement
savings plan that allows eligible employees to defer a portion of
their compensation, within limits prescribed by the Internal
Revenue Code, on a pre-tax or after-tax basis through contributions
to the plan. Our named executive officers are eligible to
participate in the 401(k) plan on the same terms as other full-time
employees generally. Currently, we match contributions made by
participants in the 401(k) plan at $0.50 for each $1.00 contributed
on up to 6% an employee’s eligible compensation. We believe that
providing a vehicle for retirement savings through our 401(k) plan
adds to the overall desirability of our executive compensation
package and further incentivizes our employees, including our named
executive officers, in accordance with our compensation
policies.
Severance and Change-in-Control Arrangements
We generally enter into offer letters, rather than formal
employment agreements, with our named executive officers. The
letters set forth the initial salary and bonus terms for each named
executive officer. The current base salaries and bonus targets for
the named executive officers are set forth below.
In addition, each of the named executive officers (other than Ms.
Ding), as well as certain other key employees, is a party to an
change in control and severance agreement with the Company. The
principal purpose of the agreements is to protect the Company from
certain business risks (e.g., threats from loss of
confidentiality or trade secrets, disparagement, solicitation of
customers and employees) and to define the Company’s right to
terminate the employment relationship. In return, the executive
officers are provided assurances with regard to salary and other
compensation and benefits, as well as certain severance
benefits.
For a description of these agreements and the severance benefits
provided under these arrangements, see –Potential Payments
Upon Termination or
Change-in-Control–Severance Agreements.
2021 Say-On-Pay Vote
At our 2021 annual meeting of stockholders, our stockholders
approved, on a non-binding, advisory basis, the compensation paid
to our named executive officers described in our 2021 proxy
statement. Approximately 94% of the votes cast on the matter were
voted in favor of this “say-on-pay” approval. The Board and the
Compensation Committee considered the voting results and high level
of stockholder support when establishing our executive compensation
programs for fiscal 2022.
Clawback Guidelines
Our Corporate Governance Guidelines provide that in the event of
any accounting restatement of the financial statements of the
Company, the Board will review the incentive compensation and
awards made to the executive officers based on the financial
results during the period covered by the restatement and, in
appropriate circumstances and to the extent permitted by applicable
law and the Company’s policies and plans, seek to recover or cancel
the portion of any such compensation or awards in excess of what
would have been received under the restated financial statements.
Among the key factors that the Board will consider in determining
whether seeking recovery is appropriate is whether the executive
officer engaged in fraud or willful misconduct that resulted in the
need for a restatement.
Tax Considerations
Section 162(m) of the Internal Revenue Code generally prohibits a
publicly-held company from deducting compensation paid to a current
or former named executive officer that exceeds $1 million during
the tax year. Certain awards granted before November 2, 2017 that
were based upon attaining pre-established performance measures that
were set by the Compensation Committee under a plan approved by our
stockholders, as well as amounts payable to former executives
pursuant to a written binding contract that was in effect on
November 2, 2017, may qualify for an exception to the $1 million
deductibility limit.
The Compensation Committee notes this deductibility limitation as
one of the factors in its consideration of compensation matters.
However, the Compensation Committee generally has the flexibility
to take any compensation-related actions that it determines are in
the Company’s and its stockholders’ best interest, including
designing and awarding compensation for our executive officers that
is not fully deductible for tax purposes.
Stock Ownership Requirements
The Board has historically encouraged its members and members of
senior management to acquire and maintain stock in the Company to
link the interests of such persons to the stockholders. However,
neither the Board nor the Compensation Committee has established
stock ownership guidelines for members of the Board or the
executive officers of the Company.
Securities Trading Policy/Hedging Prohibition
Officers and other employees may not engage in any transaction in
which they may profit from short-term speculative swings in the
value of the Company’s securities. This includes “short sales”
(selling borrowed securities which the seller hopes can be
purchased at a lower price in the future) or “short sales against
the box” (selling owned, but not delivered securities), “put” and
“call” options (publicly available rights to sell or buy securities
within a certain period of time at a specified price) and hedging
transactions, such as zero-cost collars and forward sale contracts.
In addition, this policy is designed to ensure compliance with all
insider trading rules.
Indemnification Agreements
The Company has entered into indemnification agreements with each
of its directors and executive officers (each, an “Indemnitee”). In
general, the indemnification agreements provide that, subject to
certain limitations, the Company will indemnify and hold harmless
each Indemnitee against all expenses, judgments, penalties, fines
and amounts paid in settlement actually and reasonably incurred by
such Indemnitee or on such Indemnitee’s behalf, in connection with
certain pending, completed or threatened proceedings, as defined in
the indemnification agreements, if the Indemnitee acted in good
faith and reasonably in the best interests of the Company and, with
respect to any criminal proceeding, had no reasonable cause to
believe that his or her conduct was unlawful.
Risk Assessment of Compensation Program
In April 2022, management assessed our compensation program for the
purpose of reviewing and considering any risks presented by our
compensation policies and practices that are reasonably likely to
have a material adverse effect on us. As part of that assessment,
management reviewed the primary elements of our compensation
program, including base salary, short-term incentive compensation
and long-term incentive compensation. Management’s risk assessment
included a review of the overall design of each primary element of
our compensation program, and an analysis of the various design
features, controls and approval rights in place with respect to
compensation paid to management and other employees that mitigate
potential risks to us that could arise from our compensation
program. Following the assessment, management determined that our
compensation policies and practices did not create risks that were
reasonably likely to have a material adverse effect on us and
reported the results of the assessment to our compensation
committee.
Report of the Compensation Committee of the Board of
Directors
The Compensation Committee of our Board of Directors has submitted
the following report for inclusion in this proxy statement:
The Compensation Committee has reviewed and discussed with
management the Compensation Discussion and Analysis set forth
above. Based on such review and discussions, the Compensation
Committee has recommended to the Board of Directors that the
Compensation Discussion and Analysis be included in the Annual
Report on Form 10-K for the year ended December 31, 2021, filed by
us with the SEC.
This report of the Compensation Committee is not “soliciting
material,” shall not be deemed “filed” with the SEC and shall not
be incorporated by reference by any general statement incorporating
by reference this proxy statement into any filing under the
Securities Act of 1933, as amended, or the Securities Exchange Act
of 1934, as amended, whether made before or after the date hereof
and irrespective of any general incorporation language in any such
filing, except to the extent that we specifically incorporate this
information by reference, and shall not otherwise be deemed filed
under such acts.
The foregoing report has been furnished by the Compensation
Committee.
Respectfully submitted,
The Compensation Committee of the Board of Directors
Jeffrey Tuder (Chairman)
James B. Avery
Summary Compensation Table
The following table sets forth information regarding the
compensation of our named executive officers for the years ended
December 31, 2021, 2020 and 2019.
|
Name and Principal Position
|
|
Year |
|
Salary
($) |
|
|
Bonus
($)(1)
|
|
|
Stock
Awards
($)(2) |
|
Option
Awards
($)(2) |
|
|
All Other
Compensation
($)(3) |
|
|
Total
($) |
|
| Ashish Sharma |
|
|
2021 |
|
|
388,128 |
|
|
175,056 |
(4) |
|
|
– |
|
2,415,000 |
|
|
|
9,626 |
|
|
|
2,987,810 |
|
| Chief Executive Officer &
President |
|
|
2020 |
|
|
317,153 |
|
|
81,985 |
(5) |
|
|
– |
|
1,415,375 |
|
|
|
7,929 |
|
|
|
1,822,442 |
|
|
Robert
Barbieri(6) |
|
|
2021 |
|
|
69,231 |
|
|
– |
|
|
|
– |
|
2,456,250 |
|
|
|
405,694 |
(7) |
|
|
2,931,175 |
|
| Chief Financial Officer |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Doug Kahn |
|
|
2021 |
|
|
311,762 |
|
|
182,597 |
(4) |
|
|
282,600 |
|
857,650 |
|
|
|
8,228 |
|
|
|
1,642,837 |
|
| Executive Vice President,
Operations |
|
|
2020 |
|
|
299,776 |
|
|
66,480 |
(5) |
|
|
– |
|
272,295 |
|
|
|
8,250 |
|
|
|
646,801 |
|
| Dan
Mondor |
|
|
2021 |
|
|
550,411 |
|
|
469,333 |
(4) |
|
|
– |
|
4,830,000 |
|
|
|
12,750 |
|
|
|
5,862,494 |
|
| Executive Chairman |
|
|
2020 |
|
|
549,589 |
|
|
199,522 |
(5) |
|
|
– |
|
– |
|
|
|
75,251 |
|
|
|
824,362 |
|
| and Former Chief Executive
Officer |
|
|
2019 |
|
|
550,000 |
|
|
563,251 |
(8) |
|
|
– |
|
– |
|
|
|
99,331 |
|
|
|
1,212,582 |
|
| Craig
Foster(9) |
|
|
2021 |
|
|
115,485 |
|
|
84,162 |
|
|
|
– |
|
– |
|
|
|
187,500 |
|
|
|
387,147 |
|
| Former Chief Financial Officer |
|
|
2020 |
|
|
141,907 |
|
|
– |
|
|
|
399,995 |
|
2,380,540 |
|
|
|
– |
|
|
|
2,922,442 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Wei
Ding (10) |
|
|
2021 |
|
|
250,000 |
|
|
– |
|
|
|
117,680 |
|
– |
|
|
|
3,243 |
|
|
|
370,923 |
|
| Vice
President and Corporate Controller |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
____________________
| (1) |
Represents bonus payments made
for performance during the applicable year. Bonus
payments were made through an award of fully vested shares under
the 2018 Omnibus Incentive Compensation Plan (the “2018 Incentive
Plan”), except for Mr. Foster’s bonus for 2021, which was paid in
cash. The number of RSUs issued was determined by dividing the
amount of the bonus award by the 5-day weighted average sales price
for the Company’s common stock. Represents the aggregate
grant date fair value of the shares issued in the respective fiscal
year as computed in accordance with ASC Topic 718, excluding the
effect of estimated forfeitures. Assumptions used in the
calculation of these amounts are included in Note
9, Share-based Compensation, in the Company’s Annual
Report on Form 10-K for the fiscal year ended
December 31, 2021. |
| (2) |
Represents the aggregate grant
date fair value of the stock and option awards granted in the
respective fiscal year as computed in accordance with ASC Topic
718, excluding the effect of estimated forfeitures. Assumptions
used in the calculation of these amounts are included in Note
9, Share-based Compensation, in the Company’s Annual
Report on Form 10-K for the fiscal year ended
December 31, 2021. |
| (3) |
See the All Other
Compensation table below for additional
information. |
| (4) |
Represents a bonus payment made
during fiscal 2021 based on individual and Company performance
during 2020. |
| (5) |
Represents a bonus payment made
during fiscal 2020 based on individual and Company performance
during 2019. |
| (6) |
Mr. Barbieri joined as the
Company’s permanent Chief Financial Officer starting October 25,
2021. |
| (7) |
Mr. Barbieri served on a
consulting basis as Interim Chief Financial Officer from March 2021
to October 2021 and amounts reflect compensation paid to the
consulting firm, TechCXO, LLC, for Mr. Barbieri’s
services. |
| (8) |
Represents a bonus payment made
during fiscal 2019 based on individual and Company performance
during 2018. |
| (9) |
Mr. Foster served as the
Company’s Chief Financial Officer from August 14, 2020 through
April 5, 2021. |
| (10) |
Ms. Ding served as the Company’s
principal financial officer and principal accounting officer from
April 5, 2021 to October 25, 2021. Ms. Ding
is no longer serving in an executive capacity. |
All Other Compensation
The following table sets forth information concerning All Other
Compensation in the table above:
|
Name
|
|
Year |
|
|
401(k)
Employer
Match
($) |
|
|
Other
Compensation
($) |
|
|
Total
($) |
|
| Ashish Sharma |
|
|
2021 |
|
|
|
9,626 |
|
|
|
– |
|
|
|
9,626 |
|
| |
|
|
2020 |
|
|
|
7,929 |
|
|
|
– |
|
|
|
7,929 |
|
| Robert Barbieri |
|
|
2021 |
|
|
|
– |
|
|
|
405,694 |
(1) |
|
|
405,694 |
|
| Doug
Kahn |
|
|
2021 |
|
|
|
8,228 |
|
|
|
– |
|
|
|
8,228 |
|
| |
|
|
2020 |
|
|
|
8,250 |
|
|
|
– |
|
|
|
8,880 |
|
| Dan Mondor |
|
|
2021 |
|
|
|
12,750 |
|
|
|
– |
|
|
|
12,750 |
|
| |
|
|
2020 |
|
|
|
8,550 |
|
|
|
66,701 |
(2) |
|
|
75,251 |
|
| |
|
|
2019 |
|
|
|
8,400 |
|
|
|
90,931 |
(2) |
|
|
99,331 |
|
| Craig
Foster |
|
|
2021 |
|
|
|
– |
|
|
|
187,500 |
(3) |
|
|
187,500 |
|
| |
|
|
2020 |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
| Wei
Ding |
|
|
2021 |
|
|
|
3,243 |
|
|
|
– |
|
|
|
3,243 |
|
__________________
| (1) |
Represents compensation paid to
TechCXO, LLC for consulting services provided by Mr. Barbieri as
interim Chief Financial Officer. |
| (2) |
Represents a living expense
allowance plus tax gross-up. |
| (3) |
Represents severance
pay. |
Grants of Plan-Based Awards
The table below sets forth information on grants of options, stock
awards and other plan-based awards to the named executive officers
in 2021. Mr. Foster did not receive equity awards during 2021.
|
|
|
|
|
Estimated
Future Payouts Under Non-Equity Incentive Plan Awards |
|
|
Estimated
Future Payouts Under Equity Incentive Plan Awards |
|
|
All Other Stock Awards: Number of Shares of Stock |
|
|
All Other Option Awards: Number of Securities |
|
|
Exercise or Base Price of Option |
|
|
Grant Date Fair Value of Stock and Option |
|
|
Name |
|
Grant Date |
|
Threshold
($) |
|
|
Target
($) |
|
|
Maximum
($) |
|
|
Threshold
(#) |
|
|
Target
(#) |
|
|
Maximum
(#) |
|
|
or
Units
(#) |
|
|
Underlying
Option (#) |
|
|
Awards
($/share) |
|
|
Awards
($) |
|
| Mr. Sharma |
|
3/9/2021 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
17,062 |
(2) |
|
|
– |
|
|
|
– |
|
|
|
175,056 |
|
| |
|
6/6/2021 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
250,000 |
(3) |
|
$ |
9.66 |
|
|
|
2,415,000 |
|
| Mr. Barbieri |
|
10/25/2021 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
375,000 |
(3) |
|
|
6.55 |
|
|
|
2,456,250 |
|
| Mr. Kahn |
|
3/9/2021 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
17,797 |
(2) |
|
|
– |
|
|
|
– |
|
|
|
182,597 |
|
| |
|
6/30/2021 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
45,000 |
(3) |
|
$ |
10.09 |
|
|
|
857,650 |
|
| |
|
12/15/2021 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
45,000 |
(4) |
|
|
– |
|
|
|
– |
|
|
|
– |
|
| Mr. Mondor |
|
3/9/2021 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
45,744 |
(1) |
|
|
– |
|
|
|
– |
|
|
|
469,333 |
|
| |
|
6/6/2021 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
500,000 |
|
|
$ |
9.66 |
|
|
|
4,830,000 |
|
| Mr. Foster |
|
3/9/2021 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
8,203 |
(1) |
|
|
– |
|
|
|
– |
|
|
|
84,162 |
|
| Ms. Ding |
|
5/7/2021 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
5,000 |
(4) |
|
|
– |
|
|
|
– |
|
|
|
41,600 |
|
| |
|
10/27/2021 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
12,000 |
(4) |
|
|
– |
|
|
|
– |
|
|
|
76,080 |
|
____________________
| (1) |
|
Represents the aggregate grant
date fair value of the stock and option awards granted in the
respective fiscal year as computed in accordance with ASC Topic
718, excluding the effect of estimated forfeitures. Assumptions
used in the calculation of these amounts are included in Note
9, Share-based Compensation, in the Original Form
10-K. |
| (2) |
|
Bonuses paid in March 2021 in the
form of immediately vesting RSUs, based upon Company and individual
performance during 2020. For Mr. Foster, the bonus award was
pro-rated to reflect the portion of the year for which he was
employed. |
| (3) |
|
Represents stock options that are
scheduled to vest over a four-year
period, with one-fourth vesting on the first
anniversary of the grant date and the remainder vesting ratably on
a monthly basis thereafter through the fourth anniversary of the
grant date. |
| (4) |
|
Represents RSU
awards. RSUs are scheduled to vest over a four-year
period, with one-fourth vesting on the first
anniversary of the grant date and the remainder vesting ratably on
a monthly basis thereafter through the fourth anniversary of the
grant date. |
| (5) |
|
Represents stock options that are
scheduled to vest over a three-year
period, with one-third vesting on the first
anniversary of the grant date and the remainder vesting ratably on
a monthly basis thereafter through the third anniversary of the
grant date. |
Outstanding Equity Awards at Fiscal Year-End
The following table provides information regarding the stock
options and RSUs held by our named executive officers that were
outstanding at December 31, 2021. Mr. Foster did not hold any
outstanding equity awards at December 31, 2021.
| |
|
|
|
Option Awards |
|
|
Stock Awards |
|
| Name |
|
Grant Date |
|
Number of
Securities
Underlying
Unexercised
Options
Exercisable
(#) |
|
|
Number of
Securities
Underlying
Unexercised
Options
Unexercisable
(#)(1) |
|
|
Option
Exercise
Price
($) |
|
|
Option
Expiration
Date |
|
Number of
shares of stock
that have
not vested
(#)(2)
|
|
|
Market value
of shares
of stock
that have not vested
($)(3)
|
|
| Ashish
Sharma |
|
6/6/2021 |
|
|
– |
|
|
|
250,000 |
|
|
|
9.66 |
|
|
6/6/2031 |
|
|
|
|
|
|
|
|
| |
|
2/5/2020 |
|
|
114,583 |
|
|
|
135,417 |
|
|
|
7.70 |
|
|
2/5/2030 |
|
|
|
|
|
|
|
|
| |
|
7/30/2018 |
|
|
213,542 |
|
|
|
36,458 |
|
|
|
1.80 |
|
|
7/30/2028 |
|
|
|
|
|
|
|
|
| |
|
9/25/2017 |
|
|
150,000 |
|
|
|
– |
|
|
|
1.38 |
|
|
9/25/2027 |
|
|
|
|
|
|
|
|
| Robert Barbieri |
|
10/25/2021 |
|
|
– |
|
|
|
375,000 |
|
|
|
6.55 |
|
|
10/25/2031 |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Doug Kahn |
|
12/15/2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
45,000 |
|
|
|
262,350 |
|
| |
|
06/30/2021 |
|
|
– |
|
|
|
85,000 |
|
|
|
10.09 |
|
|
06/30/2031 |
|
|
|
|
|
|
|
|
| |
|
7/29/2020 |
|
|
8,854 |
|
|
|
16,146 |
|
|
|
13.72 |
|
|
7/29/2030 |
|
|
|
|
|
|
|
|
| |
|
10/4/2019 |
|
|
10,416 |
|
|
|
22,917 |
|
|
|
4.78 |
|
|
10/4/2029 |
|
|
|
|
|
|
|
|
| |
|
2/13/2019 |
|
|
41,667 |
|
|
|
58,333 |
|
|
|
4.84 |
|
|
2/13/2029 |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Dan Mondor |
|
6/6/2021 |
|
|
– |
|
|
|
500,000 |
(4) |
|
|
9.66 |
|
|
6/6/2031 |
|
|
|
|
|
|
|
|
| |
|
6/6/2018 |
|
|
1,250,000 |
|
|
|
– |
|
|
|
2.00 |
|
|
6/6/2028 |
|
|
|
|
|
|
|
|
| |
|
6/6/2017 |
|
|
600,000 |
|
|
|
– |
|
|
|
0.94 |
|
|
6/6/2027 |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Wei Ding |
|
10/27/2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,000 |
|
|
|
69,960 |
|
| |
|
11/09/2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,000 |
|
|
|
87,450 |
|
___________________
| (1) |
Unless otherwise indicated, stock
options are scheduled to vest over a four-year
period, with one-fourth vesting on the first
anniversary of the grant date and the remainder vesting ratably on
a monthly basis thereafter through the fourth anniversary of the
grant date. |
| (2) |
Represents RSU
awards. RSUs are scheduled to vest over a four-year
period, with one-fourth vesting on the first
anniversary of the grant date and the remainder vesting ratably on
a monthly basis thereafter through the fourth anniversary of the
grant date. |
| (3) |
Calculated based on the closing
price per share of our common stock on December 31, 2021
($5.83). |
| (4) |
Stock options are scheduled to
vest over a three-year
period, with one-third vesting on the first
anniversary of the grant date and the remainder vesting ratably on
a monthly basis thereafter through the third anniversary of the
grant date. |
Option Exercises and Stock Vested
The following table sets forth information regarding option
exercises and stock awards that vested during 2020 with respect to
our named executive officers.
|
Name and Position |
|
Option Awards
Number of
Shares
Acquired On
Exercise (#) |
|
|
Value
Realized on
Exercise ($)(1) |
|
|
Stock Awards
Number of
Shares
Acquired On
Vesting (#) |
|
|
Value
Realized on
Vesting ($)(2) |
|
|
Ashish Sharma |
|
|
– |
|
|
$ |
– |
|
|
|
17,062 |
|
|
$ |
175,056 |
|
|
Robert Barbieri |
|
|
– |
|
|
$ |
– |
|
|
$ |
– |
|
|
$ |
– |
|
|
Doug Kahn |
|
|
10,417 |
|
|
$ |
116,692 |
|
|
|
17,797 |
|
|
$ |
182,597 |
|
|
Dan Mondor |
|
|
150,000 |
|
|
$ |
2,728,500 |
|
|
|
45,744 |
|
|
$ |
469,333 |
|
|
Craig Foster |
|
|
– |
|
|
$ |
– |
|
|
|
15,081 |
|
|
$ |
149,366 |
|
|
Wei Ding |
|
|
– |
|
|
$ |
– |
|
|
|
15,000 |
|
|
$ |
113,500 |
|
Potential Payments Upon Termination
or Change-in-Control
Change-in-Control and Severance Agreements
The Company has entered into Change-in-Control and Severance
Agreements with Messrs. Sharma, Barbieri and Kahn - all with
substantially identical provisions - to provide severance benefits
in the event the executive’s employment is terminated. A
description of the material terms of the agreements, including the
severance benefits payable under these agreements is set forth
below.
In addition, prior to his transition to Executive Chairman on March
1, 2022, the Company was a party to a Change-in-Control and
Severance Agreement with Mr. Mondor, which agreement terminated
effective upon his transition.
Under the terms of the agreements, if the employment of a named
executive officer is terminated by the Company without cause or by
the named executive officer for good reason not in connection with
a Change-in-Control, then the named executive officer is
entitled to the following severance benefits:
| |
• |
|
an
amount equal to the named executive officer’s unpaid base salary
and incentive pay through the date of termination and any other
amounts owed to the named executive officer under our compensation
plans; |
| |
• |
|
an
amount equal to six months of the named executive officer’s base
salary (12 months for Mr. Mondor), payable in cash in the form of
salary continuation; |
| |
• |
|
immediate vesting of the portion of the named
executive officer’s outstanding equity awards under our
compensation plans that would have vested or become exercisable had
his employment continued through the next vesting date (or within
12 months of the date of termination for Mr. Mondor); |
| |
• |
|
a lump-sum bonus payment equal
to the pro-rated portion of the target bonus in the year
of termination based on actual achievement of corporate performance
goals and assumed full achievement of any individual performance
goals; and |
| |
• |
|
continued participation for up to
nine months (18 months for Mr. Mondor) by the named executive
officer and his dependents in our group health plan, at the same
benefit and contribution levels in effect immediately prior to the
termination; |
provided, however, that in order to receive the aforementioned
severance benefits (other than the named executive officer’s unpaid
base salary and incentive pay through the date of termination and
any other amounts owed to the named executive officer under our
compensation plans), the named executive officer must execute a
general release of claims.
Under the agreements, subject to the executive’s execution of a
general release of claims (other than with respect to the first
severance benefit noted below), the named executive officer is
entitled to the following severance benefits, in lieu of the
benefits described above, if the named executive officer ’s
employment is terminated by the Company without cause or by the
named executive officer for good reason during a Change-in-Control
Period:
| |
• |
|
an
amount equal to the named executive officer’s unpaid base salary
and incentive pay through the date of termination and any other
amounts owed to the named executive officer under our compensation
plans; |
| |
• |
|
an
amount equal to the sum of 18 months of the named executive
officer’s base salary; |
| |
• |
|
an
amount equal to 12 months of the named executive officer’s
target annual bonus opportunity; |
| |
• |
|
immediate vesting of outstanding equity awards
under our compensation plans; and |
| |
• |
|
continued participation for up to
18 months by the named executive officer and his dependents in
our group health plan, at the same benefit and contribution levels
in effect immediately before the termination. |
The Change-in-Control and Severance Agreements
described above utilize the following definitions:
“Cause” means:
| |
• |
|
any
act of material misconduct or material dishonesty by the named
executive officer in the performance of his or her
duties; |
| |
• |
|
any
willful failure, gross neglect or refusal by the named executive
officer to attempt in good faith to perform his or her duties to
the Company or to follow the lawful instructions of the Board
(except as a result of physical or mental incapacity or illness)
which is not promptly cured after written notice; |
| |
• |
|
the
named executive officer’s commission of any fraud or embezzlement
against the Company (whether or not a misdemeanor); |
| |
• |
|
any
material breach of any written agreement with the Company, which
breach has not been cured by the named executive officer (if
curable) within 30 days after written notice thereof to the
named executive officer by the Company; |
| |
• |
|
the
named executive officer’s being convicted of (or pleading guilty or
nolo contendere to) any felony or misdemeanor involving theft,
embezzlement, dishonesty or moral turpitude; and/or |
| |
• |
|
the
named executive officer’s failure to materially comply with the
material policies of the Company in effect from time to time
relating to conflicts of interest, ethics, codes of conduct,
insider trading, or discrimination and harassment, or other breach
of the named executive officer’s fiduciary duties to the Company,
which failure or breach is or could reasonably be expected to be
materially injurious to the business or reputation of the
Company. |
“Good Reason” means the occurrence, without the named
executive officer ’s consent, for more than thirty days after such
named executive officer provides the Company a written notice
detailing such conditions of:
| |
• |
|
a
material diminution in his or her base compensation; |
| |
• |
|
a
material diminution in his or her job responsibilities, duties or
authorities; or |
| |
• |
|
a
relocation of his or her principal place of work by more than 50
miles. |
“Change-in-Control” means:
| |
• |
|
a
transaction after which an individual, entity or group owns 50% or
more of the outstanding shares of our common stock, subject to
limited exceptions; |
| |
• |
|
a
sale of all or substantially all of the Company’s assets;
or |
| |
• |
|
a
merger, consolidation or similar transaction, unless immediately
following such transaction (a) the holders of our common stock
immediately prior to the transaction continue to beneficially own
more than 50% of the combined voting power of the surviving entity
in substantially the same proportion as their ownership immediately
prior to the transaction, (b) no person becomes the beneficial
owner, directly or indirectly, of more than 50% of the total voting
power of the outstanding shares of the voting securities eligible
to elect directors of the surviving entity and (c) at least a
majority of the members of the board of directors of the surviving
entity immediately following the transaction were also members of
the Board at the time the Board approved the
transaction. |
“Change-in-Control Period” means the period
commencing 30 days prior to a Change-in-Control and
ending on the 12-month anniversary of such
Change-in-Control.
Equity Award Agreements
The following is a summary of the material terms applicable to the
outstanding equity awards held by our named executive officer s as
of December 31, 2021.
2018 Incentive Plan. The award agreements covering
grants of stock options and RSUs made to our named executive
officer s under our 2018 Incentive Plan provide that the Board, in
its discretion, may accelerate the vesting of any unvested stock
options or RSUs in the event of a change-in-control.
Under our 2018 Incentive Plan, a “change-in-control” is
defined as:
| |
• |
|
any
person becoming the beneficial owner of 50% or more of the
combined voting power of the then-outstanding shares of our common
stock, subject to certain exceptions; |
| |
• |
|
a
majority of the Board ceasing to be comprised of directors who
(a) were serving as members of the Board on May 11, 2018
or (b) became members of the Board after May 11, 2018 and
whose nomination, election or appointment was approved by a
vote of two-thirds of the then-incumbent
directors; |
| |
• |
|
a
reorganization, merger, consolidation, sale of all or substantially
all of the assets of the Company or similar transaction, unless the
holders of our common stock immediately prior to the transaction
beneficially own more than 50% of the combined voting power of
the shares of the surviving entity and certain other conditions are
satisfied; or |
| |
• |
|
a
liquidation or dissolution of the Company approved by the Company’s
stockholders. |
Mondor Transition Agreement
Effective March 1, 2022, Mr. Mondor transitioned from the role of
Chief Executive Officer of the Company to Executive Chairman, to
serve in such capacity until the Company’s next annual meeting of
stockholders, pursuant to the terms of a transition agreement
between Mr. Mondor and the Company (the “Transition Agreement”).
Pursuant to the Transition Agreement, Mr. Mondor will continue to
serve as a member of the Company’s Board of Directors and,
following the Company’s 2022 annual meeting of stockholders, will
cease employment and resume his role as non-management Chairman of
the Board. Mr. Mondor’s base salary as Executive Chairman will be
$100,000 per year. Mr. Mondor will also be entitled to a cash
success fee, payable upon the last day of his employment,
determined by multiplying $50,000 by the number of employees
successfully recruited by him during his transition period that are
employed by the Company as of such date. On March 1, 2022, the
vesting of 25% of the options granted to Mr. Mondor on June 6, 2021
accelerated and became immediately exercisable, and the remaining
options under such grant were cancelled.
Following the end of the transition period, Mr. Mondor will be
compensated as a non-employee director under the Company’s
non-employee director compensation policies, including cash
retainers for service as a Board member and Chairman of the Board,
and annual equity awards commencing at the 2022 annual meeting of
stockholders.
Potential Payments Upon Termination or Change in Control
Table
The following table summarizes the potential payments to our named
executive officers in two scenarios: (1) upon termination by us
without cause or the executive’s resignation for good reason apart
from a change in control; or (2) upon termination by us without
cause or the executive’s resignation for good reason within 30 days
prior to or 12 months following a Change-in-Control. The table
assumes that the termination of employment or Change-in-Control, as
applicable, occurred on December 31, 2021. The value of the
accelerated vesting of stock and option awards was computed using
$5.83, which was the price of our common stock at December 31, 2021
(less, in the case of option awards, the exercise price per share
of such option awards).
The employment of Mr. Foster terminated effective April 5, 2021 to
pursue other interests. Accordingly, he is not included in the
table below as he would not have been entitled to any benefits in
the event of the occurrence of any of the triggering events
described in the table on December 31, 2021. In connection with his
termination, Mr. Foster received severance in the amount of
$187,500 as provided for under his Change-in-Control and Severance
Agreement, as described above. Mr. Mondor transitioned from his
role as Chief Executive Officer to Executive Chairman effective
March 1, 2022. A description of the Transition Agreement with Mr.
Mondor is provided above. Ms. Ding is not eligible for severance
benefits and therefore is not included in the table below as she
would not have been entitled to any benefits in the event of the
occurrence of any of the triggering events described in the table
on December 31, 2021.
|
Name/Benefit |
|
Involuntary Termination Without Cause/Resignation for Good
Reason Apart from a Change in Control (1)
($) (1)
|
|
|
Involuntary Termination Without
Cause/Resignation for Good Reason in Connection with a Change in
Control ($) (2) |
|
| Ashish Sharma |
|
|
|
|
|
|
|
|
| Cash
severance |
|
|
400,000 |
|
|
|
800,000 |
|
| Accelerated Vesting
of Equity |
|
|
125,938 |
|
|
|
146,926 |
|
| Health Benefits |
|
|
18,000 |
|
|
|
36,000 |
|
|
Total |
|
|
537,938 |
|
|
|
982,926 |
|
| Robert
Barbieri |
|
|
|
|
|
|
|
|
| Cash severance |
|
|
400,000 |
|
|
|
800,000 |
|
| Accelerated Vesting
of Equity |
|
|
– |
|
|
|
– |
|
| Health Benefits |
|
|
13,500 |
|
|
|
27,000 |
|
|
Total |
|
|
409,000 |
|
|
|
827,000 |
|
| Doug Kahn |
|
|
|
|
|
|
|
|
| Cash severance |
|
|
292,500 |
|
|
|
617,500 |
|
| Accelerated Vesting
of Equity |
|
|
18,938 |
|
|
|
344,163 |
|
| Health Benefits |
|
|
13,500 |
|
|
|
27,000 |
|
|
Total |
|
|
320,438 |
|
|
|
988,663 |
|
| Dan Mondor |
|
|
|
|
|
|
|
|
| Cash severance |
|
|
1,265,000 |
|
|
|
1,540,000 |
|
| Accelerated Vesting
of Equity |
|
|
– |
|
|
|
– |
|
| Health Benefits |
|
|
13,500 |
|
|
|
27,000 |
|
|
Total |
|
|
1,274,000 |
|
|
|
1,567,000 |
|
____________________
|
(1) |
Represents base salary for 6 months (12 months in the case of
Mr. Mondor), a prorated target annual bonus for the year of
termination, and continued health plan coverage for up to 9 months
(18 months for Mr. Mondor) at our expense. Also includes the value
the equity awards eligible for accelerated vesting upon such
termination. |
|
(2) |
Represents base salary for 18 months, payable in a lump sum,
the executive’s target annual bonus for the year of termination,
and continued health plan coverage for up to 18 months at our
expense. Also reflects the value of the accelerated vesting of all
outstanding stock and option awards. |
CEO Pay Ratio
As required by the Dodd-Frank Wall Street Reform and Consumer
Protection Act, we are providing disclosure regarding the ratio of
the annual total compensation of Mr. Mondor, who was our CEO during
fiscal 2021, to the median of the total annual compensation of our
employees other than Mr. Mondor. We identified our employee with
the median annual compensation using total cash compensation for
calendar year 2021 of all employees who were employed by us on
December 31, 2021, at which date our global workforce consisted of
508 employees, of which 292 were U.S. employees and 216 were
non-U.S. employees. We did not include any contractors or other
non-employee workers in our employee population. We annualized the
compensation for any employees who commenced work during calendar
2021. We believe total cash compensation for all employees is
reasonable to use as a consistently applied compensation measure
because we do not have a broad-based equity award plan. We selected
December 31, 2021, which is within the last three months of our
fiscal 2021, for the date as of when we would identify the employee
with the median annual compensation, because it enabled us to make
such identification in a reasonably efficient and economical
manner.
After identifying the employee with the median total cash
compensation for the 12 months ended December 31, 2021, we
calculated total compensation for this employee for the fiscal year
ended December 31, 2021 using the same methodology that we use for
our named executive officers in the Summary Compensation Table
above.
For fiscal 2021, the total compensation of our Mr. Mondor was
$5,862,494, and the total compensation of our employee with median
annual compensation was $133,330. Accordingly, we estimated our CEO
pay ratio for fiscal 2021 to be 44 to 1.
Director Compensation
We use a combination of cash and equity-based incentive
compensation to attract and retain qualified candidates to serve on
the Board. Upon the recommendation of the Compensation Committee,
the Board makes all compensation decisions for
our non-management directors. In recommending director
compensation, the Compensation Committee considers, among other
things, the amount of time required of directors to fulfill their
duties. A director who is also an employee of the Company does not
receive additional compensation for serving as a director.
Cash Compensation. The Board has approved the following
components of the annual cash retainer fee to
our non-management directors for Board and Board
committee service in 2021 (which amounts are prorated for
directors who only served for a portion of the year):
| |
|
Chair |
|
|
Member |
|
| Board of Directors |
|
$ |
80,000 |
(1) |
|
$ |
40,000 |
|
| Audit Committee |
|
$ |
20,000 |
|
|
$ |
10,000 |
|
| Compensation Committee |
|
$ |
14,000 |
|
|
$ |
6,000 |
|
| Nominating and Corporate Governance
Committee |
|
$ |
10,000 |
|
|
$ |
5,000 |
|
__________________________
(1) As our Chief Executive Officer and Executive Chairman, Mr.
Mondor does not receive retainers for his service on the Board.
Commencing on the date of our 2022 annual meeting of stockholders,
Mr. Mondor will cease serving as an employee and Executive Chariman
and will continue as a non-management Chairman of the Board,
eligible for compensation under our non-management director
compensation program.
Equity-Based Compensation. The Board approved the
following components for equity compensation to be awarded to each
non-management director of the Company for fiscal 2021.
| |
• |
|
An initial equity award upon joining the Board in
the form of RSUs with an economic value of $145,000. The RSUs vest
in three equal annual installments beginning with the first
anniversary of the grant date. |
| |
• |
|
Thereafter, an annual equity award in the form of
RSUs with an economic value of $125,000 that vests in full on the
first anniversary of the grant date. |
Based on the foregoing policy, the Compensation Committee awarded
non-management directors 6,242 RSUs in May 2021 as
compensation for Board service from February 2020 to February 2021,
and 14,221 RSUs in July 2021 for Board service from July 2021 until
the 2022 annual meeting of stockholders. The non-management
directors, including Mr. Mondor, will be eligible for annual awards
during 2022 as described above.
Director Compensation Table. The table below summarizes the
compensation paid to our non-management directors for service on
the Board for the fiscal year ended December 31, 2021. In
addition to the payments below, the Company reimburses directors
for reasonable out-of-pocket expenses incurred
in connection with attending Board and Board committee
meetings.
|
Name |
|
Fees Earned
in
Cash ($) |
|
|
Stock
Awards ($)(1)(2) |
|
|
All Other
Compensation ($) |
|
|
Total ($) |
|
| James B. Avery(3) |
|
|
56,000 |
|
|
|
176,936 |
|
|
|
– |
|
|
|
255,936 |
|
| Stephanie
Bowers(4) |
|
|
14,835 |
|
|
|
262,385 |
(5) |
|
|
– |
|
|
|
277,220 |
|
| Christopher Harland |
|
|
50,000 |
|
|
|
176,936 |
|
|
|
– |
|
|
|
226,936 |
|
| Christopher Lytle |
|
|
40,000 |
|
|
|
176,936 |
|
|
|
– |
|
|
|
216,936 |
|
| Brian
Miller(6) |
|
|
20,833 |
|
|
|
– |
|
|
|
– |
|
|
|
20,833 |
|
| Jeffrey Tuder |
|
|
79,000 |
|
|
|
176,936 |
|
|
|
– |
|
|
|
255,936 |
|
_____________________
| (1) |
Represents the aggregate grant
date fair value of the equity awards granted in 2021 as computed in
accordance with Accounting Standards Codification (“ASC”) Topic
718, excluding the effect of estimated forfeitures. Assumptions
used in the calculation of these amounts are included in Note 9,
Share-based Compensation, in the Company’s Annual Report
on Form 10-K for the fiscal year ended
December 31, 2021. |
| (2) |
The following table shows, for
each of our non-management directors, the
aggregate number of shares subject to stock and option awards
outstanding as of December 31, 2021. |
|
Name |
|
Stock
Awards (#) |
|
|
Option
Awards (#) |
|
| James B. Avery (issued to
Tavistock Financial LLC) |
|
|
14,221 |
|
|
|
– |
|
| Stephanie Bowers |
|
|
28,070 |
|
|
|
– |
|
| Christopher Harland |
|
|
22,555 |
|
|
|
– |
|
| Christopher Lytle |
|
|
24,810 |
|
|
|
– |
|
| Brian Miller |
|
|
– |
|
|
|
– |
|
| Jeffrey Tuder |
|
|
14,221 |
|
|
|
56,912 |
|
| (3) |
As required by the terms of his
employment with Tavistock Financial, LLC, all cash director fees
earned by Mr. Avery are paid to Tavistock Foundation, Inc., a
non-profit incorporated and existing under the laws of the State of
Florida, and all equity awards to which he would be entitled for
service as a director of the Company are issued to Tavistock
Financial LLC. |
| (4) |
Ms. Bowers was appointed to the
Board effective as of June 15, 2021. |
| (5) |
Includes both the initial grant
made to Ms. Bowers with three-year vesting and an annual
grant. |
| (6) |
Mr. Miller resigned from the
Board effective March 1, 2021. |
| Item 12. |
Security
Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters |
Equity Compensation Plan Information
As of December 31, 2021, the Company’s Amended and Restated
2000 Employee Stock Purchase Plan (the “Purchase Plan”) and the
2018 Incentive Plan were the only compensation plans under which
securities of the Company were authorized for grant. The Purchase
Plan and the 2018 Incentive Plan were approved by our stockholders.
In 2019, the Board terminated the Company’s 2015 Incentive
Compensation Plan (the “2015 Incentive Plan”), which was adopted by
the Board without stockholder approval pursuant to NASDAQ Listing
Rule 5635. The following table provides information as of
December 31, 2021 regarding the Company’s existing and
predecessor plans:
|
Plan category |
|
Number of securities to be
issued upon exercise of
outstanding options |
|
|
Weighted-average
exercise price of
options outstanding |
|
|
Number of securities remaining
available for future issuance
under equity compensation
plans |
|
| Equity compensation plans
approved by security holders |
|
|
7,512,670 |
|
|
$ |
4.77 |
(1) |
|
|
3,481,834 |
(2) |
| Equity compensation plans not approved
by security holders |
|
|
573,123 |
(3) |
|
$ |
5.33 |
|
|
|
– |
|
______________________
| (1) |
Amount is based on the
weighted-average exercise price of vested and unvested stock
options outstanding under the 2018 Incentive Plan and predecessor
plans. RSUs, which have no exercise price, are excluded from this
calculation. |
| (2) |
Represents shares available for
future issuance under the Purchase Plan and the 2018 Incentive
Plan. As of December 31, 2021, there were 170,811 shares of
our common stock available for issuance under the Purchase Plan and
3,311,023 shares of our common stock available for issuance under
the 2018 Incentive Plan. |
| (3) |
Represents outstanding options under the 2015 Incentive Plan and
the Inducement Options (as defined below) issued to our Chief
Financial Officer. The 2015 Incentive Plan, which includes the same
material terms as the 2018 Incentive Plan, could only be used for
inducement grants to individuals to induce them to become employees
of the Company or any of its subsidiaries, or, in conjunction with
a merger or acquisition, to convert, replace or adjust outstanding
stock options or other equity compensation awards, or for any other
reason for which there is an applicable exception from the
stockholder approval requirements of NASDAQ Listing Rule 5635,
in each such case, subject to the applicable requirements of the
NASDAQ Listing Rules.
In October 2021, as an inducement to accepting the appointment as
the Company’s new Chief Financial Officer, Mr. Barbieri received a
one-time stock option award to purchase 375,000 shares of common
stock, with an exercise price equal to the closing trading price of
the Company’s common stock on October 25, 2021 (the “Inducement
Options”). The Inducement Options vest according to the following
schedule: one-fourth of the Inducement Options shall vest on
October 25, 2022 and the remaining Inducement Options vest ratably
each month thereafter for a period of 36 months. The Inducement
Options were issued as an employment inducement award in accordance
with NASDAQ Listing Rule 5635(c)(4). The Inducement Options are
subject to the same material terms as options awarded under the
2018 Incentive Plan,
|
Security Ownership Certain Beneficial Owners and
Management
The tables below provide information regarding the beneficial
ownership of our common stock as of March 31, 2022 by: (i) each of
our directors; (ii) each of our named executive officers; (iii) all
current directors and executive officers as a group; and (iv) each
beneficial owner of more than five percent of our common stock.
Beneficial ownership is determined in accordance with SEC rules and
regulations, and generally includes voting power or investment
power with respect to securities held. Unless otherwise indicated
and subject to applicable community property laws, we believe that
each of the stockholders named in the table below has sole voting
and investment power with respect to the shares shown as
beneficially owned. Securities that may be beneficially acquired
within 60 days after March 31, 2022 are deemed to be beneficially
owned by the person holding such securities for the purpose of
computing the ownership of such person, but are not treated as
outstanding for the purpose of computing the ownership of any other
person.
The address for directors and executive officers is 9710 Scranton
Road, Suite 200, San Diego, California 92121. The tables below list
the number and percentage of shares beneficially owned based on
107,389,076 shares of common stock outstanding as of March 31,
2022.
Directors and Named Executive Officers
| Name
of Beneficial Owner |
|
Shares Owned
(#) |
|
|
Right to Acquire
(#)(1) |
|
|
Total Shares of
Common Stock
Beneficially
Owned
(#) |
|
|
Percentage |
|
| Dan Mondor |
|
|
243,040 |
|
|
|
1,881,116 |
|
|
|
2,124,156 |
|
|
|
1.9% |
|
| Ashish Sharma |
|
|
282,861 |
|
|
|
597,916 |
|
|
|
880,777 |
|
|
|
* |
|
| Robert Barbieri |
|
|
35,414 |
|
|
|
– |
|
|
|
35,414 |
|
|
|
|
|
| Doug Kahn |
|
|
91,380 |
|
|
|
94,791 |
|
|
|
186,171 |
|
|
|
* |
|
| Craig Foster |
|
|
10,163 |
|
|
|
– |
|
|
|
10,163 |
|
|
|
* |
|
| James B. Avery |
|
|
– |
(2) |
|
|
– |
(2) |
|
|
– |
(2) |
|
|
* |
|
| Stephanie Bowers |
|
|
524 |
|
|
|
– |
|
|
|
524 |
|
|
|
* |
|
| Christopher Harland |
|
|
56,502 |
|
|
|
– |
|
|
|
56,502 |
|
|
|
* |
|
| Christopher Lytle |
|
|
284,437 |
|
|
|
29,734 |
|
|
|
314,171 |
(3) |
|
|
* |
|
| Jeffrey Tuder |
|
|
151,048 |
|
|
|
56,912 |
|
|
|
207,960 |
|
|
|
* |
|
|
All directors and executive officers as a group (nine persons) |
|
|
912,329 |
|
|
|
779,353 |
|
|
|
1,691,682 |
|
|
|
1.6% |
|
__________________
| * |
Represents beneficial ownership
of less than 1% of the outstanding shares of our common
stock. |
| (1) |
Represents shares of common stock
that may be acquired pursuant to stock options or warrants that are
or will become exercisable within 60 days after March 31,
2022. |
| (2) |
Does not include shares of common
stock or warrants held by Braslyn, Ltd., Golden Harbor Ltd. or
Tavistock Financial, LLC, in which Mr. Avery disclaims beneficial
ownership, which are reported in the table below under Five
Percent Holders. Mr. Avery is obligated to transfer any shares
issued pursuant to any equity awards made to him by the Company, or
the economic benefits thereof, to Tavistock Financial,
LLC. |
| (3) |
Includes 29,722 shares of common
stock issuable upon the conversion outstanding convertible notes
held in an individual retirement for the benefit of Mr. Lytle’s
mother. Mr. Lytle has investment power with respect to such shares
and may be deemed to be the beneficial owner thereof. Mr. Lytle
disclaims beneficial ownership of such shares. |
Five Percent Holders
The following table sets forth information regarding the number and
percentage of shares of common stock held by all persons and
entities known by us to beneficially own five percent or more of
our outstanding common stock. The information regarding beneficial
ownership of the persons and entities identified below is included
in reliance on reports filed by the persons and entities with the
SEC, except for modifications that are disclosed below and except
that the percentage is based upon our calculations made in reliance
upon the number of shares reported to be beneficially owned by such
person or entity in such report and the number of shares of common
stock outstanding on March 31, 2022.
| Name and Address
of Beneficial Owner |
|
Shares Owned
(#) |
|
|
Right to Acquire
(#) |
|
|
Total Shares of
Common Stock
Beneficially
Owned
(#) |
|
|
Percentage |
|
|
Golden Harbor Ltd.(1)
Cay House
EP Taylor Drive N7776
Lyford Cay
New Providence C5
|
|
|
21,019,191 |
|
|
|
3,814,106 |
|
|
|
24,833,297 |
|
|
|
22.3% |
|
|
North Sound Management, Inc. (2)
c/o Edward E. Murphy
115 East Putnam Avenue
Greenwich, CT 06830
|
|
|
4,220,133 |
|
|
|
5,029,758 |
|
|
|
9,249,891 |
|
|
|
8.2% |
|
|
BlackRock, Inc. (3)
55 East 52nd Street
New York, NY 10055
|
|
|
6,125,749 |
|
|
|
– |
|
|
|
6,125,749 |
|
|
|
5.7% |
|
______________________
| (1) |
According to a Schedule 13D/A
filed by Golden Harbor Ltd., Braslyn Ltd., Tavistock Financial, LLC
and Joe Lewis with the SEC on September 24, 2021, Golden Harbor
Ltd. has shared voting and dispositive power over 14,908,149 shares
of common stock, Braslyn Ltd. has shared voting and dispositive
power over 7,908,678 shares of common stock, Tavistock Financial,
LLC has shared voting and dispositive power over 77,364 shares of
common stock and Joe Lewis has shared voting and dispositive power
over 22,894,191 shares of common stock. Includes (a) 1,875,000
shares of the Company’s common stock issuable upon exercise of
warrants and (b) 1,939,106 shares of common stock issuable upon the
conversion outstanding convertible notes that were not included in
the beneficial ownership amounts disclosed in the Schedule 13D/A
filed on September 24, 2021 but are currently exercisable because
the ownership limitation in the convertible notes has
terminated. |
| (2) |
According to a Schedule 13D/A
filed by North Sound Management, Inc., North Sound Trading, LP and
Brian Miller with the SEC on March 2, 2021, North Sound Management,
Inc. has sole voting and dispositive power over 4,788,213 shares of
common stock, North Sound Trading, LP has sole voting and
dispositive power over 4,788,213 shares of common stock and Mr.
Miller has shared voting and dispositive power over 4,845,133
shares of common stock. Includes (a) 56,920 shares of common stock
held directly by Mr. Miller and (b) 625,000 shares of common stock
that may be acquired pursuant to outstanding warrants. Also
included 4,404,758 shares of common stock issuable upon the
conversion outstanding convertible notes that were not included in
the beneficial ownership amounts disclosed in the Schedule 13D/A
filed on March 2, 2021 but are currently exercisable because the
ownership limitation in the convertible notes has
terminated. |
| (3) |
Based on a Schedule 13G filed
with the SEC on February 4, 2022. |
Performance Graph
The following graph compares the cumulative total stockholder
return on our common stock since the end of 2016. with the
cumulative total return of (a) the NASDAQ Composite Index
(b) the NASDAQ Telecommunications Index. The comparison
assumes $100 was invested at the end of 2016 in our common stock
and in each of the indices shown and assumes that all dividends
were reinvested.
|
Index |
12/31/2016 |
12/31/2017 |
12/31/2018 |
12/31/2019 |
12/31/2020 |
12/31/2021 |
| Inseego
Corp. |
$100.00 |
$65.98 |
$170.08 |
$300.41 |
$634.02 |
$238.93 |
| NASDAQ
Composite Index |
$100
.00 |
$129.64 |
$125.96 |
$172.17 |
$249.51 |
$304.85 |
| NASDAQ
Telecommunications Index |
$100.00 |
$128.15 |
$99.13 |
$117.72 |
$129.55 |
$132.60 |
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires our directors, executive
officers, and anyone holding 10% or more of a registered class of
our equity securities to file reports with the SEC showing their
holdings of, and transactions in, these securities. Based solely on
a review of copies of such reports we received, we believe that
during 2021 all its reporting persons filed such reports on a
timely basis, with the exception of (a) one delinquent Form 3 and
Form 4 for Ms. Bowers that were filed on December 6, 2021 due to an
administrative delay in receiving EDGAR filing codes, (b) one
delinquent Form 3 and Form 4 for Mr. Barbieri that was filed on
December 6, 2021 due to administrative delay in receiving EDGAR
filing codes and (c) a delinquent Form 4 for Mr. Tuder due to
administrative delay in receiving EDGAR filing codes.
| Item 13. |
Certain
Relationships and Related Transactions, and Director
Independence |
Transactions with Related Persons
Series E Preferred Exchanges
On September 3, 2021, the Company entered into separate
privately-negotiated exchange agreements (each, an “Exchange
Agreement”) with Golden Harbor Ltd. and North Sound Trading, L.P.
(the “Participating Stockholders”), holders of the Company’s
outstanding Series E Fixed-Rate Cumulative Perpetual Preferred
Stock, par value $0.001 per share (the “Series E Preferred Stock”).
Pursuant to each respective Exchange Agreement, each of the
Participating Stockholders agreed to exchange Series E Preferred
Stock that they currently held (representing an aggregate of
$13,180,539 base amount of Series E Preferred Stock and accrued
dividends) for an aggregate of 1,525,207 shares of Common Stock,
par value $0.001 (“Common Stock”), of the Company (the “Private
Exchange Transactions”). The Company did not receive any cash
proceeds from the Participating Stockholders in connection with the
Private Exchange Transactions. Mr. Avery is a Vice President of
Golden Harbor Ltd.
In connection with the Private Exchange Transactions, the Company
agreed to file a registration statement with the Securities and
Exchange Commission in order to effect a registration for the
resale by the Participating Stockholders of the shares of Common
Stock exchanged through the Private Exchange Transactions.
The Private Exchange Transactions were negotiated, reviewed and
approved by a committee of our Board comprised solely of directors
disinterested in the Private Exchange Transactions.
Interest Payments on Convertible Notes
During fiscal 2021, the Company made interest payments to Golden
Harbor, North Sound and an individual retirement account held by
Mr. Lytle’s mother, over which Mr. Lytle has investment discretion
in the amounts of $794,820, $1,805,180, and $12,188 respectively,
pursuant to the Company’s 3.25% Convertible Senior Notes due
2025.
Parents of the Company
The Company has no parents except to the extent that either of the
Investors may be deemed a parent by virtue of their ownership of
the Company’s outstanding shares of Common Stock, and their Board
nomination and appointment rights under the Securities Purchase
Agreement, dated August 6, 2018, by and among the Company, Golden
Harbor Ltd. and North Sound Trading, L.P.
Director Independence
Under the NASDAQ listing requirements, a majority of the members of
our Board must be independent. The Board has determined that James
Avery, Stephanie Bowers, Christopher Harland and Jeffrey Tuder are
each “independent” of the Company and management within the meaning
of the NASDAQ listing requirements. Mr. Mondor is not
“independent” under the NASDAQ listing requirements because he is
an employee of the Company. Mr. Lytle is not “independent”
under the NASDAQ listing requirements because he is a former
employee of and consultant to the Company.
| Item 14. |
Principal Accountant Fees and
Services |
Principal Accountant Fees and Services
The following table sets forth fees for services rendered by Marcum
LLP for 2021 and 2020.
| |
|
2021 |
|
|
2020 |
|
| Audit
Fees(1) |
|
$ |
870,865 |
|
|
|
|
|
|
$ |
868,290 |
|
| Audit-Related
Fees(2) |
|
|
26,368 |
|
|
|
|
|
|
|
86,906 |
|
| Tax Fees |
|
|
– |
|
|
|
|
|
|
|
– |
|
| All Other
Fees |
|
|
– |
|
|
|
|
|
|
|
– |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Total |
|
$ |
897,233 |
|
|
|
|
|
|
$ |
955,196 |
|
| (1) |
Audit fees consist principally of
fees for the audits of our annual consolidated financial statements
and internal control over financial reporting, and review of our
interim consolidated financial statements. |
| (2) |
Audit-related fees consist
primarily of fees for accounting consultations, comfort letters,
consents and any other audit attestation services. |
Pre-Approval Policies and Procedures
The Audit Committee annually reviews
and pre-approves certain audit and non-audit services
that may be provided by our independent registered public
accounting firm and establishes and pre-approves the aggregate
fee level for these services. Any proposed services that would
cause us to exceed the pre-approved aggregate fee amount must
be pre-approved by the Audit Committee. All audit and
non-audit services for 2021 and 2020 were pre-approved by the Audit
Committee.
PART IV
| Item 15. |
Exhibits
and Financial Statement Schedules |
| (a)(1) |
|
The Company’s consolidated financial statements
and report of Marcum LLP, Independent Registered Public Accounting
Firm, are included in Section IV of this report beginning on page
F-1. |
| |
|
| (a)(2) |
|
Schedules have been omitted because they are not
applicable or are not required or the information required to be
set forth therein is included in the consolidated financial
statements or related notes thereto. |
| |
|
| (b) |
|
Exhibits |
The following Exhibits are filed as part of, or incorporated by
reference into this report:
|
Exhibit No. |
|
Description |
| |
|
|
| 2.1 |
|
Share Purchase Agreement, dated as of
February 24, 2021, by and between Inseego Corp. and Main Street
1816 Proprietary Limited (in the process of being renamed
Convergence CTSA Proprietary Limited)(incorporated by reference to
Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed
February 25, 2021). |
| |
|
|
| 2.2 |
|
First Addendum dated March 17, 2021
to the Share Purchase Agreement dated February 24, 2021 between
Main Street 1816 Proprietary Limited (in the process of being
renamed Convergence CTSA Proprietary Limited) and Inseego Corp.
(incorporated by reference to Exhibit 10.3 to the Company’s Current
Report on Form 8-K filed June 30, 2021.) |
| |
|
|
| 2.3 |
|
Second Addendum dated April 30, 2021
to the Share Purchase Agreement dated February 24, 2021 between
Main Street 1816 Proprietary Limited (in the process of being
renamed Convergence CTSA Proprietary Limited) and Inseego Corp.
(incorporated by reference to Exhibit 10.2 to the Company’s Current
Report on Form 8-K filed June 30, 2021). |
| |
|
|
| 2.4 |
|
Third Addendum dated June 30, 2021 to
the Share Purchase Agreement dated February 24, 2021 between Main
Street 1816 Proprietary Limited (in the process of being renamed
Convergence CTSA Proprietary Limited) and Inseego Corp.
(incorporated by reference to Exhibit 10.1 to the Company’s Current
Report on Form 8-K filed June 30, 2021.) |
| |
|
|
| 3.1 |
|
Amended and Restated Certificate of
Incorporation (incorporated by reference to Exhibit 3.1 to the
Company’s Current Report on Form 8-K, filed November 9,
2016). |
| |
|
|
| 3.2 |
|
Amended and Restated Bylaws of
Inseego Corp. (incorporated by reference to Exhibit 3.2 to the
Company’s Current Report on Form 8-K, filed November 9,
2016). |
| |
|
|
| 3.3 |
|
Certificate of Designation of Series
D Junior Participating Preferred Stock of Inseego Corp.
(incorporated by reference to Exhibit 3.1 to the Company’s Current
Report on Form 8-K, filed January 22, 2018). |
| |
|
|
| 3.4 |
|
Certificate of Designation of Series
E Fixed-Rate Cumulative Perpetual Preferred Stock (incorporated by
reference to Exhibit 3.1 to the Company’s Current Report on Form
8-K, filed August 13, 2019). |
| |
|
|
| 3.5 |
|
Certificate of Amendment to
Certificate of Designation of Series E Fixed-Rate Cumulative
Perpetual Preferred Stock (incorporated by reference to Exhibit 3.1
to the Company’s Current Report on Form 8-K, filed March 10,
2020). |
| |
|
|
| 4.1 |
|
Form of Inseego Corp. Common Stock
Certificate (incorporated by reference to Exhibit 4.1 to the
Company’s Current Report on Form 8-K filed November 9,
2016). |
| |
|
|
| 4.2 |
|
Description of Equity Securities
Registered under Section 12 of the Exchange Act. (incorporated by
reference to Exhibit 4.2 to the Company’s Annual Report on Form
10-K filed on March 1, 2021). |
| |
|
|
| 4.3 |
|
Base Indenture, dated May 12, 2020,
between Inseego Corp. and Wilmington Trust, National Association,
as trustee (incorporated by reference to Exhibit 4.1 to the
Company’s Current Report on Form 8-K, filed May 12, |
| |
|
|
| 4.4 |
|
First Supplemental Indenture, dated
May 12, 2020, between Inseego Corp. and Wilmington Trust, National
Association, as trustee (incorporated by reference to Exhibit 4.2
to the Company’s Current Report on Form 8-K, filed May 12,
2020). |
| 4.5 |
|
Form of 3.25% convertible senior note
due 2025 (incorporated by reference Exhibit 10.5 to the Company’s
Quarterly Report on Form 10-Q, filed August 10,
2020). |
| |
|
|
| 4.6 |
|
Common Stock Purchase Warrant issued
to Golden Harbor Ltd., dated March 28, 2019, by Inseego Corp.
(incorporated by reference to Exhibit 4.1 to the Company’s Current
Report on Form 8-K, filed March 29, 2019). |
| |
|
|
| 4.7 |
|
Common Stock Purchase Warrant issued
to North Sound Trading, L.P., dated March 28, 2019, by Inseego
Corp. (incorporated by reference to Exhibit 4.2 to the Company’s
Current Report on Form 8-K, filed March 29, 2019). |
| |
|
|
| 4.8 |
|
Registration Rights Agreement, dated
August 6, 2018, by and among Inseego Corp. and the Investors
identified on Exhibit A to the Securities Purchase Agreement
(incorporated by reference to Exhibit 4.3 to the Company’s Current
Report on Form 8-K, filed August 7, 2018). |
| |
|
|
| 10.1* |
|
Amended and Restated Inseego Corp.
2000 Employee Stock Purchase Plan (incorporated by reference to
Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed
July 18, 2018). |
| |
|
|
| 10.2* |
|
Offer Letter dated July 26, 2020
between Inseego Corp. and Craig L. Foster
(incorporated by reference to Exhibit
10.3 to the Company’s Quarterly Report on Form 10-Q, filed November
6, 2020). |
| |
|
|
| 10.3* |
|
Change in Control Agreement dated
August 17, 2020 between Inseego Corp. and Craig L.
Foster
(incorporated by reference to Exhibit
10.4 to the Company’s Quarterly Report on Form 10-Q, filed November
6, 2020). |
| |
|
|
| 10.4* |
|
Form of Indemnification (incorporated
by reference to Exhibit 10.3 to the Company’s Current Report on
Form 8-K, filed August 21, 2017). |
| |
|
|
| 10.5* |
|
Employment Offer Letter, dated June
6, 2017, between Inseego Corp. and Dan Mondor (incorporated by
reference to Exhibit 10.1 to the Company’s Current Report on Form
8-K, filed June 9, 2017). |
| |
|
|
| 10.6* |
|
Indemnification Agreement, dated June
6, 2017, between Inseego Corp. and Dan Mondor (incorporated by
reference to Exhibit 10.3 to the Company’s Current Report on Form
8-K, filed June 9, 2017). |
| |
|
|
| 10.7* |
|
Amendment to Offer Letter, dated
October 26, 2017, by and between the Company and Dan Mondor
(incorporated by reference to Exhibit 10.8 to the Company’s
Quarterly Report on Form 10-Q, filed on November 7,
2017). |
| |
|
|
| 10.8* |
|
Inseego Corp. 2015 Incentive
Compensation Plan (incorporated by reference to Exhibit 10.26 to
the Company’s Annual Report on Form 10-K, filed on March 16,
2018). |
| |
|
|
| 10.9* |
|
Form of Nonstatutory Stock Option
Agreement under the Inseego Corp. 2015 Incentive Compensation Plan
(incorporated by reference to Exhibit 10.27 to the Company’s Annual
Report on Form 10-K, filed on March 16, 2018). |
| |
|
|
| 10.10* |
|
Amended Inseego Corp. 2018 Omnibus
Incentive Compensation Plan (incorporated by reference to Exhibit
10.1 to the Company’s Current Report on Form 8-K, filed July 30,
2021). |
| |
|
|
| 10.11 |
|
Securities Purchase Agreement, dated
August 6, 2018, by and among Inseego Corp. and the Investors
identified on Exhibit A thereto (incorporated by reference to
Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed
August 7, 2018). |
| |
|
|
| 10.12 |
|
Securities Purchase Agreement, dated
August 9, 2019, by and among Inseego Corp. and the Investors
identified on Exhibit A thereto (incorporated by reference to
Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed
August 13, 2019). |
| |
|
|
| 10.13 |
|
Securities Purchase Agreement, dated
March 6, 2020, by and among Inseego Corp. and the Investor
identified on Exhibit A thereto (incorporated by reference to
Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on
March 10, 2020). |
| |
|
|
| 10.14 |
|
Assignment and License Agreement,
dated as of February 24, 2021, by and between Inseego Corp. and
certain entities that will be acquired by Purchaser in the Sale
Transaction (incorporated by reference to Exhibit 10.2 to the
Company’s Current Report on Form 8-K, filed February 25,
2021). |
| |
|
|
| 10.15 |
|
Transitional Services Agreement,
dated as of February 24, 2021, by and between Inseego Corp. and
certain entities that will be acquired by Purchaser in the Sale
Transaction (incorporated by reference to Exhibit 10.3 to the
Company’s Current Report on Form 8-K, filed February 25,
2021). |
| |
|
|
| 10.16 |
|
Trademark Agreement, dated as of
February 24, 2021, by and between Inseego Corp. Ctrack Holdings
(Pty) Limited, and certain entities that will be acquired by
Purchaser in the Sale Transaction (incorporated by reference to
Exhibit 10.5 to the Company’s Current Report on Form 8-K, filed
February 25, 2021). |
| |
|
|
| 10.17 |
|
Equity Distribution Agreement, dated
as of January 25, 2021, by and between Inseego Corp. and Canaccord
Genuity LLC (incorporated by reference to Exhibit 10.1 to the
Company’s Current Report on Form 8-K, filed January 26,
2021). |
| |
|
|
| 10.18* |
|
Amended and Restated Change in
Control and Severance Agreement, dated June 7, 2021, by and between
the Company and Dan Mondor (incorporated by reference to Exhibit
10.1 to the Company’s Current Report on Form 8-K, filed June 10,
2021). |
| |
|
|
| 10.19* |
|
Independent Contractor Services
Agreement, dated as of August 5, 2021, by and between the Company
and TechCXO, LLC (incorporated by reference to Exhibit 10.2 to the
Company’s Quarterly Report on Form 10-Q, filed August
5,
2021). |
| |
|
|
| 10.20* |
|
Offer Letter dated October 13, 2021
between Inseego Corp. and Robert G. Barbieri. (incorporated by
reference to Exhibit 10.1 to the Company’s Current on Form 8-K/A,
filed October 26, 2021). |
| |
|
|
| 10.21* |
|
Form of Inducement Stock Option
Agreement, by and between Inseego Corp. and Robert G. Barbieri
(incorporated by reference to Exhibit 10.2 to the Company’s Current
on Form 8-K/A, filed October 26, 2021). |
| |
|
|
| |
|
|
| 10.23 |
|
Form
of
Exchange Agreement, dated September
3,
between Inseego Corp.
and certain
investors holding the Company’s
Series E Fixed-Rate Cumulative Perpetual Preferred Stock
(incorporated by reference to
Exhibit
1.2
to the Company’s Current Report on
Form 8-K, filed
September 3,
2021). |
| |
|
|
| 21 |
|
Subsidiaries of Inseego Corp
(incorporated by reference to Exhibit 21 to the Company’s Annual
Report on Form 10-K for the period ended December 31, 2021, filed
on March 1, 2022). |
| |
|
|
| 23.1 |
|
Consent of Independent Registered
Public Accounting Firm (Marcum LLP) (incorporated by reference to
Exhibit 23.1 to the Company’s Annual Report on Form 10-K for the
period ended December 31, 2021, filed on March 1,
2022). |
| |
|
|
| 31.1 |
|
Certification of our Principal
Executive Officer adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002(incorporated by reference to Exhibit
31.1 to the Company’s Annual Report on Form 10-K for the period
ended December 31, 2021, filed on March 1, 2022). |
| |
|
|
| 31.2 |
|
Certification of our Principal
Financial Officer adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002(incorporated by reference to Exhibit
31.2 to the Company’s Annual Report on Form 10-K for the period
ended December 31, 2021, filed on March 1, 2022). |
| |
|
|
| 31.3** |
|
Certification of
our Principal Executive Officer adopted pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002. |
| |
|
|
| 31.4** |
|
Certification of
our Principal Financial Officer adopted pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002. |
| |
|
|
| 32.1 |
|
Certification of Principal Executive
Officer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
(incorporated by reference to Exhibit 32.1 to the
Company’s Annual Report on Form 10-K for the period ended December
31, 2021, filed on March 1, 2022). |
| |
|
|
| 32.2 |
|
Certification of Principal Financial
Officer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
(incorporated by reference to Exhibit 32.2 to the Company’s Annual
Report on Form 10-K for the period ended December 31, 2021, filed
on March 1, 2022). |
| |
|
|
| 101.INS |
|
Inline XBRL Instance Document - the instance
document does not appear in the Interactive Data File because its
XBRL tags are embedded within the Inline XBRL document. |
| |
|
|
| 101.SCH |
|
Inline XBRL Taxonomy Extension Schema
Document. |
| |
|
|
| 101.CAL |
|
Inline XBRL Taxonomy Extension Calculation
Linkbase Document. |
| |
|
|
| 101.DEF |
|
Inline XBRL Taxonomy Extension Definition
Linkbase Document. |
| |
|
|
| 101.LAB |
|
Inline XBRL Taxonomy Extension Label Linkbase
Document. |
| |
|
|
| 101.PRE |
|
Inline XBRL Taxonomy Extension Presentation
Linkbase Document. |
| |
|
|
| 104 |
|
Cover Page Interactive Data File (formatted as
inline XBRL and contained in Exhibit 101) |
| * |
|
Management contract, compensatory plan or
arrangement |
| ** |
|
Filed herewith |
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
| Date:
May 2, 2022 |
|
|
|
INSEEGO CORP. |
| |
|
|
|
| |
|
|
|
By |
|
/s/ Robert Barbieri |
| |
|
|
|
|
|
Robert Barbieri |
| |
|
|
|
|
|
Chief Financial Officer |
| |
|
|
|
|
|
(Principal Financial and Accounting
Officer) |
Inseego (NASDAQ:INSG)
Historical Stock Chart
From May 2023 to Jun 2023
Inseego (NASDAQ:INSG)
Historical Stock Chart
From Jun 2022 to Jun 2023
