Item
5.02
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers;
Compensatory Arr
angements of Certain Officers
.
Employment Agreements
On
August
3
, 2017
,
NCS Multistage Holdings, Inc. (the “Company”)
entered into employment agreements with each of Robert Nipper,
the
Chief Executive Officer
,
Tim Willem
s, the Chief Operations Officer,
Ryan Hummer, the Chief Financial Officer
,
and
Wade Bitter
, the
Chief
Accounting Officer
(each of whom is referred to herein as
an
“
Executive
”)
.
T
he agreements provide for an initial term of three years
and
will automatically renew
thereafter for
additional
one
year-
terms
. The agreements provide that the Executives will receive an annualized base salary subject to
increases as determined
by
the
Board of Directors (the “Board”)
(currently
$
450,000
for Mr. Nipper,
$
330,000
for Mr. Willems
,
$
330,000
for Mr.
Hummer and
$
310,000
for Mr. Bitter). The agreements also provide that the Executives are eligible to receive
an
annual
cash
bonus award
pursuant to the Company’s then annual cash bonus plan based upon the achievement of annual performance targets established by the Board at the beginning of each such calendar year
(target annual bonus amounts are equal to 105% of base salary for Mr. Nipper, 80% of base salary for Mr. Willems, 75% of base salary for Mr. Hummer and 75% of base salary for Mr. Bitter and the maximum annual bonus that may be paid to each Executive is 200% of base salary)
.
If the Executive’s employment is terminated by the Company other than for Cause (as such term is defined in the Executive’s employment agreement), the Executive resigns for Good Reason (as such term is defined in the Executive’s employment agreement) or if Company does not renew the employment agreement, then
in addition to any accrued but unpaid base salary
and any earned but unpaid annual bonus for the year p
rior to the year of termination
, the Company must provide the Executive an amount equal to the pro-rated bonus the Executive would otherwise have received for the fiscal year of termination based on actual performance, one times (two times in the case of Mr. Nipper) the sum of Executive’s then-current base salary and target bonus, an
d
the full premium for health benefits
elected by the Executive
under COBRA for the twenty four-month period following the date of termination. In addition,
notwithstanding anything to the contrary in an award agreement governing the Executive’s equity incentive awards, the Executive’s unvested equity incentive awards that are outstanding on the Executive’s termination date shall remain outstanding and eligible to vest on the same vesting schedule set forth in the applicable award agreement, subject to the Executive’s compliance with certain restrictive covenants, and any stock options that vest following the Executive’s termination date may be exercised for ninety days following the applicable vesting date and will be forfeited if not exercised during such period
.
If the Executive’s employment is terminated other than for Cause, the Executive resigns for Good
Reason or the Company does not
renew the employment agreement, each within twenty-four months following a change of control, then,
in addition to any accrued but unpaid base salary
and any earned but unpaid annual bonus for the year prior to the year of termination, the Company must provide the Executive an amount equal to the pro-rated bonus the Executive would otherwise have received for the fiscal year of termination based on actual performance, two times (three times in the case of Mr. Nipper) the sum of Executive’s then-current base salary and target bonus, and the full premium for health benefits
elected by the Executive
under COBRA for the twenty four-month period following the date of termination. In addition,
notwithstanding anything to the contrary in an award agreement governing the Executive’s equity incentive awards, the Executive’s unvested equity incentive awards that are outstanding as of the Executive’s termination date shall fully vest on the termination date
.
The severance benefits above are subject to the Executives execution of a release of certain claims and continued compliance with the restrictive covenants contained in the respective agreement. The agreements include perpetual confidentiality provisions, a mutual non-disparagement provision, as well as provisions relating to non-competition and non-solicitation that apply during employment and for one year following a termination of employment.
The foregoing description of the employment agreements with each Executive does not purport to be complete and is qualified in its entirety by reference to the terms of such employment agreements, a copy of which are attached hereto as Exhibit 10.1 through 10.4 and incorporated by reference herein.
Form of Executive
Award Agreements
On August
3
, 2017
, the
Board
approved
certain form of award agreements
under the 2017 Equity Incentive Plan for executive officers including
an updated
Form of Stock Option Award Agreement
and
Form of
Restricted Stock Unit
Agreement
.
The
Form of Stock Option Award Agreement
and
F
orm of Restricted Stock Unit Agreement
are
filed herewith as Exh
ibit 10.5 and
10.6, respectively, and incorporated herein by reference.