Item 1.01. Entry Into a Material Definitive Agreement.
The information set forth under Item 5.02 below is incorporated in its entirety herein by reference.
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Resignation of Director
Brendan O’Grady resigned from the Board of Directors of American Well Corporation (the “Company”), effective July 19, 2021. Mr. O’Grady has served on the Board of Directors with distinction since 2015. Mr. O’Grady’s decision to resign was related to his appointment as our Chief Commercial & Growth officer as described below and did not involve any disagreement with the Company on any matter relating to the Company’s operations, policies or practices.
Appointment of Chief Commercial & Growth Officer
On July 19, 2021, the Company entered into an Employment Agreement (the “Employment Agreement”) with Mr. O’Grady to become the Company’s Chief Commercial & Growth Officer, effective August 16, 2021. Pursuant to the Employment Agreement, Mr. O’Grady will receive an annual base salary of $485,000 and will be eligible for an annual target bonus of 200% of his annual base salary. In addition, Mr. O’Grady will receive a grant of restricted stock units with a grant date value of $8,000,000 that settle in shares of the Company’s Class A common stock, with 25% of the restricted stock units being vested on the grant date, and the remaining vesting ratably every 3 months thereafter over a four-year period (beginning on the first calendar day of the month following the date that is three months following the grant date).
The Employment Agreement provides that if Mr. O’Grady’s employment is involuntarily terminated (terminated without Cause (as defined in the Employment Agreement) or with Good Reason (as defined in the Employment Agreement)), conditioned on Mr. O’Grady’s execution and non-revocation of a release of claims, Mr. O’Grady will be entitled to receive the following: Accrued Compensation (as defined in the Employment Agreement) through the date of termination; any earned but unpaid bonus amounts, including a pro rata bonus for the year in which Mr. O’Grady’s employment terminates (or one year’s target bonus if such termination of employment occurs one month before or within 24 months following a Change in Control (as defined in the Employment Agreement)); severance payments in an aggregate amount equal to his base salary, to be paid in equal installments over a one-year period; and COBRA benefits. In addition, if the involuntary termination of employment occurs in connection with a Change in Control, each unvested equity award held by Mr. O’Grady will fully vest at the time of termination. To the extent applicable, such payments are subject to reduction so that they will not be subject to the excise tax imposed under Section 4999 of the Internal Revenue Code.
The Employment Agreement also includes customary confidentiality and assignment of intellectual property obligations, as well as non-competition and non-solicitation restrictions that continue for 365 days following termination of employment.
The foregoing summary description of the Employment Agreement is not complete and is subject to, and qualified in its entirety by reference to, the full text of the Employment Agreement, which is filed as Exhibit 10.1 to this Form 8-K and is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
