In accordance with the terms of the Subscription Agreement, on July 13, 2022, the Company and Mr. Liu entered into a support agreement (the “Designee Support Agreement”). The terms of the Designee Support Agreement are analogous to the terms of the Purchaser Support Agreement, provided that the Designee Support Agreement does extend its requirements solely to 952,381 shares of Common Stock issued during the first closing rather than the entirety of the shares of Common Stock owned by Mr. Liu. The foregoing description of the Designee Support Agreement does not purport to be complete and is qualified in its entirety by reference to the Designee Support Agreement, which is filed as Exhibit 10.2 to this Current Report on Form 8-K and incorporated herein by reference.
Registration Rights Agreement
In accordance with the terms of the Subscription Agreement, on July 13, 2022, the Company and the Purchaser entered into a registration rights agreement (the “Registration Rights Agreement”). Pursuant to the Registration Rights Agreement, the Company is required (among other things), within 30 days of the Second Closing, as defined in the Subscription Agreement, to file with the SEC a registration statement to register the resale of all registrable securities held by Purchaser or any person that receives Registrable Securities (as that term is defined in the Registration Rights Agreement) (each a “Holder”). The Company’s obligation to register the Registrable Securities for sale under the Securities Act of 1933 terminates upon the first to occur of (i) the date that is five years from the effective date of the shelf registration statement filed by the Company pursuant to the Registration Rights Agreement, (ii) the date on which all Holders can sell shares of common stock of the Company under Rule 144 without volume restrictions, and (iii) the date on which no registrable securities are held by any Holder.
The foregoing description of the Registration Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the Registration Rights Agreement, which is filed as Exhibit 10.5 to this Current Report on Form 8-K and incorporated herein by reference.
| Item 3.02 | Unregistered Sales of Equity Securities. |
To the extent required by Item 3.02 of Form 8-K, the information contained in Item 1.01 of this Current Report on Form 8-K is incorporated by reference herein.
| Item 5.01 | Changes in Control of Registrant. |
To the extent required by Item 5.01, the information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated by reference herein.
In accordance with the terms of the Subscription Agreement, each of the directors of the Company who would not be continuing as a director after the completion of the first closing resigned from the Board of Directors of the Company (the “Board”) and any respective committees of the Board to which they belonged as of the first closing. The Board, the size of which had been already set at a total of five (5) directors, was re-constituted concurrent with the first closing as follows:
| | • | | Michael Mulica, who did not resign; |
| | • | | Alan Howe, who did not resign; |
| | • | | Jeffrey Wang, who was appointed by the remaining directors; |
| | • | | Jack Steenstra, who was appointed by the remaining directors; and |
| | • | | James Cassano, who was appointed by the remaining directors. |
Each post-closing director was appointed to the Board to serve until the next annual meeting of stockholders at which the members of the Board stand for election (subject to the Company’s amended and restated bylaws) or until such director’s earlier death, resignation, or removal, or until such director’s successor is duly elected and qualified.
| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
To the extent required by Item 5.02 of Form 8-K, the information contained in Items 1.01 and 5.01 of this Current Report on Form 8-K is incorporated by reference herein.
(b) Resignation of Directors and Officers
Pursuant to the Subscription Agreement, on July 13, 2022, immediately prior to the first closing, John Kneuer and Sue Swenson resigned from the Board and each respective committee of the Board to which they were appointed. The Board approved the acceleration of the unvested outstanding Company equity awards held by Mr. Kneuer and Ms. Swenson, effective immediately prior to their resignations and immediately prior to the first closing.
On July 13, 2022, Robert Tirva, President, Chief Financial Officer and Chief Operating Officer (principal financial and accounting officer) of the Company resigned from his positions with the Company and its affiliates.
In conjunction with his resignation, and also on July 13, 2022, the Company entered into a Release Agreement (the “Release Agreement”) with Mr. Tirva. The Company previously agreed that upon Mr. Tirva’s resignation in connection with the first closing, the Company would provide him certain severance benefits (consisting of a total cash severance payment of $1,000,000 (payable in installments over 20 months), accelerated vesting of his then-outstanding and unvested equity-based awards granted by the Company, and, subject to his providing consulting services to the Company for three months after his termination date, reimbursement for his COBRA health insurance premiums for up to 18 months following his termination) in consideration for his continued employment through the first closing and his providing the Company with a release of claims in a form acceptable to the Company. The Release
