| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
Amendment to Employment Agreement with Vivek Gupta, Chief Executive Officer and President.
On March 10, 2021, Mastech Digital, Inc. (the “Company”) amended its Fourth Amended and Restated Executive Employment Agreement, dated as of March 20, 2019 (the “Gupta Employment Agreement”), with Vivek Gupta, the Company’s Chief Executive Officer and President, by replacing the prior compensation schedule attached thereto with a revised compensation schedule (the “Revised Gupta Compensation Schedule”).
The Revised Gupta Compensation Schedule is effective April 1, 2021 and amends the Gupta Employment Agreement by providing that (i) Mr. Gupta’s base salary shall be $540,000 per year, subject to review and modification annually by the Company; and (ii) Mr. Gupta is eligible to earn an annual performance-based cash bonus of $210,000 (the “Gupta Performance-Based Cash Bonus”) for the achievement of certain financial and operational targets, which targets, and the bonus dollars tied to such targets, will be determined by the Company’s Board of Directors on an annual basis.
Under the Revised Gupta Compensation Schedule, $105,000 of the Gupta Performance-Based Cash Bonus for the 2021 calendar year will be based on (i) the Company’s IT Staffing Services segment (“ITS”) revenues; (ii) ITS Non-GAAP EBITDA; and (iii) ITS Gross Profit Dollars. The remaining $105,000 of the Gupta Performance-Based Cash Bonus for the 2021 calendar year is based on the reduction of the percentage of ITS employees who are H1-B visa holders.
Except as amended by the Revised Gupta Compensation Schedule, the terms of the Gupta Employment Agreement are unchanged and remain in full force and effect.
Amendment to Employment Agreement with Paul Burton, Chief Executive of Mastech InfoTrellis, Inc.
On March 10, 2021, Mastech InfoTrellis, Inc. (“Mastech InfoTrellis”), a wholly owned subsidiary of the Company, amended its Executive Employment Agreement, dated December 12, 2018 (the “Burton Employment Agreement”), with Paul Burton, the Chief Executive of Mastech InfoTrellis, by replacing the prior compensation schedule attached thereto with a revised compensation schedule (the “Revised Burton Compensation Schedule”).
The Revised Burton Compensation Schedule, dated March 10, 2021, amends the Burton Employment Agreement by providing that (i) Mr. Burton’s base salary, which is subject to review and modification annually by Mastech InfoTrellis, shall be $450,000 for the 2021 fiscal year; (ii) Mr. Burton is eligible to earn an annual performance-based cash bonus of $200,000 (the “Burton Performance-Based Cash Bonus”) for the achievement of certain financial and operational targets, which targets, and the bonus dollars tied to such targets, will be determined by the Company’s Board of Directors on an annual basis; and (iii) Mr. Burton is granted an award of a non-qualified stock option to purchase 160,000 shares of the Company’s common stock pursuant to the Company’s Stock Incentive Plan, vesting in four equal annual installments beginning on the first anniversary of the February 10, 2021 grant date.
Under the Revised Burton Compensation Schedule, $140,000 of the Burton Performance-Based Cash Bonus for the 2021 calendar year will be based on (i) the bookings for Mastech InfoTrellis, which represents the Company’s Data and Analytics Services segment (“D&A”); (ii) D&A Revenues; and (iii) D&A Non-GAAP EBITDA. The remaining $60,000 of the Burton Performance-Based Cash Bonus for the 2021 calendar year is subjective and based upon performance criteria to be established by the Company.
Except as amended by the Revised Burton Compensation Schedule, the terms of the Burton Employment Agreement are unchanged and remain in full force and effect.
Amendment to Employment Agreement with John J. Cronin, Jr., Chief Financial Officer.
On March 10, 2021, the Company amended its Third Amended and Restated Executive Employment Agreement, dated as of March 20, 2019 (the “Cronin Employment Agreement”), with John J. Cronin, Jr., the Company’s Chief Financial Officer, by replacing the prior compensation schedule attached thereto with a revised compensation schedule (the “Revised Cronin Compensation Schedule”).
The Revised Cronin Compensation Schedule is effective April 1, 2021 and amends the Cronin Employment Agreement by providing that (i) Mr. Cronin’s base salary shall be $404,250 per year, subject to review and modification annually by the Company; and (ii) Mr. Cronin is eligible to earn an annual performance-based cash bonus of $150,000 (the “Cronin Performance-Based Cash Bonus”) for the achievement of certain financial and operational targets, which targets, and the bonus dollars tied to such targets, will be determined by the Company’s Chief Executive Officer on an annual basis.
