Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On February 9, 2017, the Company announced that William Day has resigned as the Companys President and Chief Executive Officer, effective immediately, and will resign as a member of the Companys board of directors, or the Board, effective March 1, 2017.
The Company announced that Paul Caine has been appointed as Interim Chief Executive Officer. Mr. Caine has served as a director and a member of the audit committee of the Board since June 2014, and as its Non-Executive Chairman since July 2016. In connection with his appointment to Interim CEO, Mr. Caine resigned from his roles as Non-Executive Chairman and as a member of the audit committee of the Board. Mr. Caine will continue to serve as a director during his service as Interim CEO.
James Rossman, who has served as a member of the Board since January 2011, and currently serves on the nominating and corporate governance committee and as chairman of the compensation committee, will replace Mr. Caine on the audit committee.
On February 6, 2017, the Company and Mr. Day entered into an agreement (the Transition Agreement) governing the terms of his transition. The Transition Agreement provides that Mr. Day will serve as a special advisor to the Company and the Board through June 1, 2017 (the Transition End Date), and will remain employed, with his current operational responsibilities, through March 1, 2017. Subject to Mr. Days compliance with the Transition Agreement, Mr. Day will continue to receive his current base salary and be eligible to participate in the Companys benefit plans (or be reimbursed for any COBRA premiums) through the Transition End Date. Mr. Day will not be entitled to participate in the Companys annual bonus plan for 2017. The Transition Agreement further provides that Mr. Day will continue to vest in his equity awards through the Transition End Date. Following the Transition End Date, Mr. Days equity will be treated in accordance with their terms, except that the Company has agreed to amend the terms of his options granted on February 24, 2014, February 23, 2015, and May 29, 2015 to provide that Mr. Day shall be entitled to exercise such options for a period of one year from the Transition End Date. Mr. Day will be bound by a confidentiality covenant, a 12-month non-compete obligation and a 12-month non-solicitation obligation following termination of his employment.
In connection with Mr. Caines appointment as Interim CEO, on February 6, 2017, the Company entered into an offer letter with Mr. Caine (the Caine Offer Letter). Under the terms of the Caine Offer Letter, Mr. Caine will be paid a one-time bonus of $86,000 and will be paid a salary of $66,667 per month. Mr. Caine will also be entitled to participate in the Companys benefit plans. During his service as Interim CEO, Mr. Caine will not be entitled to receive any cash payments pursuant to the Companys Non-Employee Director Compensation Plan, but he will continue to vest in any equity awards that were issued to him in connection with his service as a director.
On February 7, 2017, the Company entered into amendments to the offer letters (each, an Offer Letter Amendment) with each of Adam Lichstein, the Companys President, Seller Platforms, Lauren Wiener, the Companys President, Buyer Platforms, and John Rego, the Companys Chief Financial Officer (each, an Executive).
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