Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of
Certain Officers.
Resignation of Michael A. Sadowski as Executive Vice President, Chief Financial
Officer
On January 5, 2022, Michael A. Sadowski, Executive Vice President, Chief
Financial Officer of AutoWeb, Inc. ("Company"), notified the Company that he was
resigning his officer positions with the Company effective January 10, 2022. Mr.
Sadowski will remain employed by the Company in a non-officer capacity for a
short period of time to assist in the transition of his duties and
responsibilities.
Appointment of Carlton D. Hamer as Executive Vice President, Chief Financial
Officer
By action taken as of January 5, 2022, the Board of Directors of the Company
("Board") appointed Mr. Carlton D. Hamer, age 51, as Executive Vice President,
Chief Financial Officer, to be effective upon his commencement of employment
with the Company, which is anticipated to be January 10, 2022.
Prior to joining the Company, Mr. Hamer served as Controller of Fortna, Inc., a
provider of warehouse optimization, design, and automation services (2021-2022),
and as the Vice President, Finance for Nextraq, LLC, a provider of vehicle and
asset tracking solutions (2020 to 2021). Mr. Hamer was employed by Cox
Automotive, Inc., a provider of automotive media, software, wholesale, and
mobility solutions, serving as Vice President, Corporate Services (2014 to
2020), Vice President, Strategic Planning and Program Management (2009 to 2013),
and Senior Director, Finance/Controller (2006 to 2008). Mr. Hamer received his
Bachelor of Business Administration, cum laude, from the University of Georgia.
On January 5, 2022, the Board's Compensation Committee ("Compensation
Committee") approved a base annual salary and target annual incentive
compensation percentage for Mr. Hamer in connection with his appointment to the
position of Executive Vice President, Chief Financial Officer. Mr. Hamer's base
annual salary will be $335,000 and his target annual incentive compensation
percentage will be 55% of his base annual salary.
The Compensation Committee also approved a grant of stock options to acquire
120,000 shares of the Company's common stock at an exercise price equal to the
closing price of the common stock on The Nasdaq Capital Market on the day Mr.
Hamer commences employment with the Company ("Hamer Grant Date"). The options
will be granted as inducement options under Nasdaq rules. The options will have
a term of seven years, and one-third of the options will vest on the first
anniversary of the Hamer Grant Date and one thirty-sixth of the options shall
vest on each successive monthly anniversary of the Hamer Grant Date for the
following twenty-four months. Vesting of the options will accelerate upon the
occurrence of certain events, including upon a change in control of the Company
or upon a termination of Mr. Hamer's employment by the Company without cause or
by Mr. Hamer for good reason. The Company anticipates entering into an
Inducement Stock Option Award Agreement with Mr. Hamer upon the commencement of
his employment to provide for the foregoing grant of stock options.
Additionally, the Compensation Committee approved severance benefits for Mr.
Hamer which provide that if Mr. Hamer's employment with the Company is
terminated by the Company without cause or by Mr. Hamer for good reason, Mr.
Hamer would be entitled to: (i) a lump sum payment equal to 12 months of his
base annual salary; and (ii) continuation of his health and welfare insurance
benefits for 12 months. In addition, Mr. Hamer will be entitled to receive: (i)
in the case of a termination of employment by the Company without cause or by
Mr. Hamer for good reason, and not in connection with or within 18 months
following a change of control of the Company, a lump sum payment equal to Mr.
Hamer's annual incentive compensation payout under the then-current annual
incentive compensation plan based on actual performance for the entire
performance period, prorated for the amount of time Mr. Hamer was employed by
the Company prior to the date of termination during such performance period
("Actual Incentive Compensation Payout"); or (ii) in the case of a termination
of employment by the Company without cause or by Mr. Hamer for good reason, and
in connection with or within 18 months following a change of control of the
Company, a lump sum payment equal to Mr. Hamer's annual incentive compensation
payout based on Mr. Hamer's annual incentive compensation target payout,
prorated for the amount of time Mr. Hamer was employed by the Company prior to
the date of termination during such performance period ("Target Incentive
Compensation Payout") plus, if the Actual Incentive Compensation Payment is more
than the Target Incentive Compensation Payment, then Mr. Hamer will receive an
additional lump sum payment equal to the difference between the Actual Incentive
Compensation Payment and the Target Incentive Compensation Payment The Company
anticipates entering into a Severance Benefits Agreement with Mr. Hamer upon the
commencement of his employment to provide for the foregoing.
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Appointment of Joshua J. Barsetti as Vice President, Controller and Principal
Accounting Officer
By action taken as of January 3, 2022, the Board appointed Mr. Joshua J.
Barsetti, age 42, as Vice President, Controller and Principal Accounting
Officer, to be effective upon the commencement of his employment, which is
anticipated to be January 17, 2022.
Prior to joining the Company, Mr. Barsetti served as Senior Director of Internal
Audit from May 2021 to January 2022 and Director of Sox and Internal Control
from June 2020 to May 2021 for Zovio Inc. (NASDAQ: ZVO), a provider of education
technology services and solutions. Mr. Barsetti was also employed by Cavco
Industries, Inc. (NASDAQ: CVCO), a provider of manufactured homes, serving as
Chief Accounting Officer (August 2018 to May 2020), Corporate Controller (August
2017 to August 2018), and Chief Audit Executive (September 2014 to August 2017).
He previously served as Director of Financial Reporting (November 2013 to
September 2014) and Financial & IT Audit Manager/Senior Audit Manager (May 2011
to November 2013) for Universal Technical Institute, Inc., a provider of
transportation industry technical training. Mr. Hamer received his Bachelor of
Science, Accounting from Northern Arizona University.
On January 3, 2022, the Compensation Committee approved a base annual salary and
target annual incentive compensation percentage for Mr. Barsetti in connection
with his appointment to the position of Vice President, Controller and Principal
Accounting Officer. Mr. Barsetti's base annual salary will be $225,000 and his
target annual incentive compensation percentage will be 35% of his base annual
salary.
The Compensation Committee also approved a grant of stock options to acquire
30,000 shares of the Company's common stock at an exercise price equal to the
closing price of the common stock on The Nasdaq Capital Market on the day Mr.
Barsetti commences employment with the Company ("Barsetti Grant Date"). The
options will be granted as inducement options under Nasdaq rules. The options
will have a term of seven years, and one-third of the options will vest on the
first anniversary of the Barsetti Grant Date and one thirty-sixth of the options
shall vest on each successive monthly anniversary of the Barsetti Grant Date for
the following twenty-four months. The Company anticipates entering into an
Inducement Stock Option Award Agreement with Mr. Barsetti upon the commencement
of his employment to provide for the foregoing grant of stock options.
Additionally, the Compensation Committee approved severance benefits for Mr.
Barsetti which provide that if Mr. Barsetti's employment with the Company is
terminated by the Company without cause or by Mr. Barsetti for good reason, Mr.
Barsetti would be entitled to: (i) a lump sum payment equal to 6 months of his
base annual salary; and (ii) continuation of his health and welfare insurance
benefits for 6 months. The Company anticipates entering into a Severance
Benefits Agreement with Mr. Barsetti upon the commencement of his employment to
provide for the foregoing.
The foregoing descriptions of Mr. Hamer's and Mr. Barsetti's terms of employment
are not complete and are qualified in their entirety by reference to their
Offers of Employment, which are filed with this Current Report on Form 8-K as
Exhibit 10.1 and Exhibit 10.2, respectively, and are incorporated herein by
reference.
A copy of the Company's press release announcing the appointment of Mr. Hamer
and Mr. Barsetti is attached as Exhibit 99.1 to this Current Report on Form 8-K
and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
d. Exhibits
10.1 Offer of Employment between Carlton D. Hamer and AutoWeb, Inc. dated
January 4, 2022
10.2 Offer of Employment between Josh J. Barsetti and AutoWeb, Inc. dated
December 21, 2021
99.1 Press Release dated January 7, 2022
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