Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers
Chief Financial Officer Transition
On May 5, 2022, we announced the appointment of Mark Weinswig as our Chief
Financial Officer, effective May 16, 2022. Mr. Weinswig will replace Andrew
Hamer, who will leave Velodyne on June 1, 2022.
Mr. Weinswig served as the Chief Financial Officer of Avinger, Inc., a
Nasdaq-listed medical device company, from June 2018 through May 2022. Prior to
joining Avinger, Mr. Weinswig served as Chief Financial Officer at Aqua Metals,
Inc., a Nasdaq-listed heavy metal recycling company, from August 2017 to
March 2018. Mr. Weinswig has previously served as Chief Financial Officer of One
Workplace, a designer and manufacturer of customized workspaces, from July 2016
to July 2017. From October 2010 to June 2016, Mr. Weinswig served as Chief
Financial Officer of Emcore Corporation, a Nasdaq-listed designer and
manufacturer of indium phosphide optical chips, components, subsystems and
systems for the broadband and specialty fiber optics market. Earlier in his
career Mr. Weinswig worked at Coherent, Inc., Avanex Corporation, which merged
with Bookham Technology, Morgan Stanley and PricewaterhouseCoopers. He received
an M.B.A. from the University of Santa Clara and a B.S. in business
administration with an accounting major from Indiana University. He has earned
the CFA and CPA designations.
Compensation Arrangements
We entered into an offer letter and change in control and severance agreement
with Mr. Weinswig, each dated May 3, 2022. The offer letter provides for at-will
employment. Mr. Weinswig's annual base salary will be $370,000. Mr. Weinswig
will also receive a sign-on bonus of $30,000, payable after three months of
service. Mr. Weinswig will have an aggregate annual cash bonus opportunity of up
to 70% of his annual base salary, subject to the terms and conditions of the
Company's bonus plan for executives. For 2022, his annual bonus will be prorated
based on his length of service.
In addition, Mr. Weinswig will receive a restricted stock and a
performance-based stock award, each pursuant to our 2020 Equity Incentive Plan.
The restricted stock award will have a grant date fair value of $480,000 and
will be scheduled to vest and become non-forfeitable over a 4 year period,
subject to Mr. Weinswig's continued service through the applicable vesting
dates. The performance-based stock award will have a target value of $1,120,000
scheduled to vest and become non-forfeitable over a 3 year period. The
performance-based stock award is payable in shares and the actual number of
shares earned, if any, will be determined based on the Company meeting specific
performance objectives to be established by the Compensation Committee and
subject to Mr. Weinswig's continued service through the applicable vesting
dates. The maximum payout of shares will be capped at 200% of the target award
value.
In addition, the change in control and severance agreement provides that if
Mr. Weinswig's employment is terminated outside the period beginning 3 months
before a change in control and ending 12 months following a change in control,
or the Change in Control Period, either (1) by the Company (or any of its
subsidiaries) without "cause" (excluding by reason of death or disability) or
(2) by Mr. Weinswig for "good reason", Mr. Weinswig will receive the following
benefits if he timely signs and does not revoke a release of claims in our
favor: (i) a lump-sum payment equal to 12 months of his annual base salary as in
effect immediately prior to such termination (or if such termination is due to a
resignation for good reason based on a material reduction in base salary, then
as in effect immediately prior to the reduction); and (ii) payment of premiums
for coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985,
as amended, or COBRA, for Mr. Weinswig and his eligible dependents, if any, for
up to 12 months, or taxable monthly payments for the equivalent period in the
event payment of the COBRA premiums would violate or be subject to an excise tax
under applicable law.
If, within the Change in Control Period, Mr. Weinswig's employment is terminated
either (1) by the Company (or any of its subsidiaries) without cause (excluding
by reason of death or disability) or (2) by Mr. Weinswig for good reason, then
Mr. Weinswig will receive the following benefits if he timely signs and does not
revoke a release of claims in our favor: (i) a lump-sum payment equal to 12
months of his annual base salary as in effect immediately prior to such
termination (or if such termination is due to a resignation for good reason
based on a material reduction in base salary, then as in effect immediately
prior to the reduction) or if greater, at the level in effect immediately prior
to the change in control); (ii) a lump-sum payment equal to 100% of his target
annual bonus as in effect for the fiscal year in which such termination occurs;
(iii) payment of premiums for coverage under COBRA for Mr. Weinswig and his
eligible dependents, if any, for up to 12 months, or taxable monthly payments
for the equivalent period in the event payment of the COBRA premiums would
violate or be subject to an excise tax under applicable law; and (iv) 100%
accelerated vesting and exercisability of all outstanding equity awards and, in
the case of an equity award with performance-based vesting, all performance
goals and other vesting criteria will be deemed achieved at target.
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The Company expects to enter into a Separation Agreement with Mr. Hamer that
will provide Mr. Hamer with benefits consistent with the terms of the Company's
Form of Severance and Change in Control Agreement, which has been filed as
Exhibit 10.1 to the Company's Current Report on Form 8-K (File No. 001-38703)
filed with the Securities and Exchange Commission on June 14, 2021 (the
"Severance Agreement"). The Severance Agreement provides for 12 months of salary
and 12 months of COBRA benefits in exchange for signing a standard release of
claims.
The summary description of Mr. Weinswig's offer letter and change in control and
severance agreement set forth above does not purport to be complete and is
qualified in its entirety by reference to the full text of the offer letter and
change in control and severance agreement, copies of which will be filed with
our Quarterly Report on Form 10-Q for the quarter ended June 30, 2022.
Other Matters
In addition, we will enter into our standard form of indemnification agreement
with Mr. Weinswig. The form indemnification agreement was filed with the
Securities and Exchange Commission as Exhibit 10.1 to the Registrant's Current
Report on Form 8-K (File No. 001-38703) filed on October 5, 2020 and is
incorporated herein by reference. Mr. Weinswig has no direct or indirect
material interest in any transaction required to be disclosed pursuant to
Item 404(a) of Regulation S-K promulgated under the Securities Exchange Act of
1934, as amended, nor are any such transactions currently proposed. There are no
family relationships between Mr. Weinswig and any of our directors or executive
officers.
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