| (iv) | double trigger equity acceleration, specifically, full acceleration of any outstanding, unvested Equity Awards (as such term is defined in the Severance Plan) held by the Eligible Executive, as of the effective date of the Covered Termination, or equity awards issued in substitution therefor. |
Further, amounts or severance benefits provided to an Eligible Executive under the Severance Plan will be subject to recoupment by the Company in accordance with any clawback policy of the Company, as in effect from time to time.
The Eligible Executive’s right to receive the payments and benefits provided under the Severance Plan are subject to each Eligible Executive’s execution and delivery of a release of claims, and each Eligible Executive’s compliance with non-competition, non-disparagement, non-solicitation and confidentiality covenants set forth in the Severance Plan. The non-disparagement and confidentiality covenants each have an indefinite term, and the non-competition and non-solicitation covenants each has a term of one year following the Eligible Executive’s date of termination, or if longer, the Severance Period or Change in Control Period. Additionally, the Severance Plan provides that if an Eligible Executive would be subject to an excise tax under Section 4999 of the Internal Revenue Code of 1986, as amended, then the payments and benefits the Eligible Executive receives will be reduced so that the excise tax does not apply; however, such reduction will only occur if it results in the receipt by the Eligible Executive of a greater after-tax amount than would otherwise have been received if the full payment had been provided and the excise tax applied.
In order to be eligible to receive benefits under the Severance Plan, the Company’s executive officers must execute and return to the Company a participation agreement (a “Participation Agreement”). Upon the execution of a Participation Agreement, the executive’s prior employment agreement terminates, and the continued employment of such executive will be on an at-will basis. On April 20, 2023, Messrs. Dale Foster, Andrew Clark, Charles Bass, and Vito Legrottaglie, the Company’s Chief Executive Officer, Chief Financial Officer, Chief Marking Officer and Chief Information Officer, respectively (collectively, the “Named Executive Officers”), became participants in the Severance Plan upon their delivery to the Company of executed Participation Agreements, pursuant to which the Named Executive Officers agreed to terminate the existing employment agreements between them and the Company, effective immediately, and the terms of the Severance Plan and respective Participation Agreements supersede any rights or entitlements to severance benefits under any employment agreement so terminated or other severance arrangements. The Severance Plan does not affect Named Executive Officers’ eligibility to their base salary, subject to increase at the discretion of the Board, or the Compensation Committee, and to participate in any and all other standard benefit plans, programs and policies of the Company. In connection with the Named Executive Officers’ execution of the Participation Agreements, Messrs. Mr. Foster has been designated as a “Tier 1” Participant under the Severance Plan, and Messrs. Clark, Bass and Legrottaglie have been designated as “Tier 2” Participants under the Severance Plan.
In connection with the adoption of the Severance Plan, the Board approved new forms of Cash-Based Award Agreement, Restricted Stock Unit Award Agreement and Performance-Based Restricted Award Unit Agreement (the “Award Agreements”) under the Company’s 2021 Omnibus Incentive Plan (the “Plan”). The form of Cash Based Award Agreement governs the grants of annual cash bonuses upon the satisfaction of performance goals set by the Board or the Compensation Committee. The form of Restricted Stock Unit Award Agreement provides for the grants of time-based restricted stock units (“RSUs”) that will vest based on the grantee continuedly remaining in a Service Relationship (as such term is defined in the Plan) with the Company or a subsidiary thereof through an applicable vesting date(s) to be set by the Board, or the Compensation Committee. Vested RSUs will be settled into shares of Company common stock within 30 days following each vesting date. The form of Performance-Based Restricted Award Unit Agreement provides for the grants of performance-based restricted stock units (“PSUs”) that will vest based upon the satisfaction of performance goals over a performance cycle set by the Board, or the Compensation Committee, and the grantee continuedly remaining in a Service Relationship with the Company or a subsidiary thereof through the first January 1 following the last day of the performance cycle. Vested PSUs will be settled into shares of Company common stock within 30 days following the vesting date.
The foregoing summary of certain of the terms of the Severance Plan and the Award Agreements does not purport to be complete and is qualified in its entirety by reference to the full text thereof, copies of which are filed as Exhibits 10.1., 10.2, 10.3 and 10.4 to this Form 8-K and is incorporated by reference into this Item 5.02.
