Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (known as COBRA) for a period of six (6) months (the “Conditional Benefits”).
In the event of a resignation by Mr. Kim for good reason, the exercise by the Company of its right to terminate Mr. Kim other than for cause, death or disability, in each case, within twelve (12) months following or three (3) months prior to the effective date of a Change in Control, Mr. Kim will receive the following: (i) the Unconditional Entitlements and the Conditional Benefits less the Severance Amount; (ii) an amount equal to the product of 1.0 times the sum of Mr. Kim’s annual base salary and target annual cash bonus, less the Non-Compete Amount as defined in the Employment Agreement (if applicable); and (iii) accelerated vesting of all equity awards that were assumed, continued or substituted by the surviving or acquiring corporation in the Change in Control and remain subject to time-based vesting conditions, if any.
In addition, Mr. Kim entered into an Employee Proprietary Information and Invention Assignment Agreement that applies during the term of Mr. Kim’s employment and thereafter.
The foregoing description of the Employment Agreement is qualified in its entirety by reference to the complete text of the Employment Agreement, a copy of which is attached as Exhibit 10.1 to this Current Report on Form 8-K, and incorporated herein by reference.
Termination of Agreement with Korn Ferry US and Departure of Interim Chief Executive Officer, President, Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer
As disclosed in the Current Report on Form 8-K filed by the Company on January 12, 2023, the Company previously entered into an engagement letter with Korn Ferry US (the “KF Agreement”) pursuant to which Mr. Joseph Hooker was appointed to serve as Interim Chief Executive Officer, President, Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer of the Company. In connection with the appointment of Mr. Kim as the Chief Executive Officer and President as described above, on August 11, 2023 the Company terminated the KF Agreement and Mr. Hooker ceased to serve as Interim Chief Executive Officer, President, Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer of the Company as of such date. The departure of Mr. Hooker was not related to any disagreement with the Company on any matter relating to its operations, policies or practices.
Related Party Transaction
Mr. Kim, is a member of the Board and was, prior to August 11, 2023, the General Counsel and a Senior Vice President of Dong-A ST. Dong-A ST beneficially owns as of the date hereof approximately 60% of the issued and outstanding shares of the Company’s outstanding common stock. Mr. Kim is considered a related party and the transactions described in this Form 8-K constitute a “related party transaction” as defined by Item 404 of Regulation S-K.
Item 7.01Regulation FD Disclosure.
On August 14, 2023, the Company issued a press release announcing the appointment of Mr. Kim as Chief Executive Officer and President. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated into this Item 7.01 by reference.
The information in this Current Report on Form 8-K and Exhibit 99.1 attached hereto is intended to be furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.
Item 8.01Other Events.
On August 9, 2023, Mr. Kim resigned from the Compensation Committee of the Board (the “Compensation Committee”) and the Nominating and Corporate Governance Committee of the Board (the “N&CG Committee”).
