Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
New Employment Agreement
On February 11, 2019, the Company entered into a new employment agreement (the “Employment Agreement”) with Mr. John Diesch (the “Executive”), pursuant to which Mr. Diesch will continue to provide services to the Company as Executive Vice President – Operations. The Employment Agreement for Mr. Diesch supersedes and replaces his current employment agreement with the Company, which was previously filed with the Securities and Exchange Commission.
The Employment Agreement provides for an initial term ending on December 31, 2019, which automatically renews for successiveone-year periods thereafter unless either party provides written notice of his or its intention to terminate the agreement at least 90 days prior to the end of the then-current term. Mr. Diesch will have an annual base salary of $350,000, a target annual cash performance bonus equal to 60% of his base salary and a maximum annual cash performance bonus equal to 120% of his base salary. The payout for the annual cash performance bonus for Mr. Diesch will depend on the Company’s achievement of performance criteria, as determined by the Compensation Committee of the Board.
The Employment Agreement provides that if the Executive’s employment with the Company is terminated due to death or disability, he will receive a lump sum payment equal to a pro rata portion of his annual bonus based on actual company performance for the year of termination, paid at the same time such bonuses are paid to all employees generally (the“Pro-Rata Bonus”). If the Executive’s employment is terminated by the Company without Cause (as defined in the Employment Agreement), by the Executive for Good Reason (as defined in the Employment Agreement) or as a result of a notice ofnon-renewal of the Employment Agreement by the Company, the Executive will receive (i) a lump sum payment equal to thePro-Rata Bonus, (ii) a lump sum payment equal to a multiple of his base salary and target bonus (discussed below), and (iii) continuation of health benefits for the Executive and his eligible dependents for 18 months on the same economic terms applicable prior to his termination. The severance multiple for Mr. Diesch is one (or two if the termination occurs within 24 months following a Change in Control (as defined in the Employment Agreement) or either (x) within 90 days prior to the date a definitive agreement is executed which results in a Change in Control within 180 days after the date such definitive agreement is executed or (y) on or within 180 days following the date a definitive agreement is executed which results in a Change in Control within 180 days after the date such definitive agreement is executed (a “Qualifying CIC Termination”)) and the severance is payable on (i) the first pay date following the Executive’s execution (andnon-revocation) of a release of claims or (ii) the date of the Change of Control (if applicable), whichever is later. All severance or termination benefits payable to the Executive under the Employment Agreements are dependent on the Executive’s execution and delivery of a release of claims within 60 days following the date of termination. Following termination of employment, the Executive will be subject tonon-compete andnon-solicitation restrictions for a period of 24 months.
The foregoing description of the Employment Agreement does not purport to be complete and is qualified in its entirety by reference to the complete text of the Employment Agreement, which is attached hereto as Exhibit 10.1 to this Current Report on Form8-K and is incorporated herein by reference into this Item 5.02.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
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