WageWorks, Inc. (NYSE:WAGE) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Item5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
Amended Change in Control and Severance
Agreements.
On April17, 2017, we amended the Executive Severance Benefit
Agreements (the Amended Severance Agreements) with our named
executive officers, Joseph Jackson, Edgar Montes, Colm Callan,
and Kimberly Wilford. Each named executive officers Amended
Severance Agreement supersedes and replaces any and all prior
severance agreements by and between us and such named executive
officer, including any severance provisions of any offer letter,
severance agreement, employment agreement, and equity
compensation agreement. Each Amended Severance Agreement will
continue until amended or terminated.
Under the applicable Amended Severance Agreement, if, during the
period beginning on the date we execute the definitive agreement
for a change in control (as defined in the applicable Amended
Severance Agreement) and ending on the date that is 24 months
following the closing date of such change in control (such
period, the Change in Control Period), the named executive
officer has an involuntary termination (as defined in the
applicable Amended Severance Agreement), then, provided the named
executive officer timely executes and does not revoke a release
of claims and complies with his or her obligations under his or
her Proprietary Information and Inventions Assignment Agreement
(the PIIA), and complies with the non-solicitation provision in
the Amended Severance Agreement, such named executive officer
will receive the following benefits:
|
Continued payment of his or her base salary as then in effect for 24 months for Mr. Jackson, 15 months for Mr. Montes, and 12 months for Mr. Callan and Ms. Wilford; |
|
Reimbursement of COBRA premiums on a tax-neutral basis for the named executive officer and his or her qualified dependents for 18 months for Mr.Jackson, 15 months for Mr.Montes, and 12 months for Mr.Callan and Ms.Wilford; |
|
A lump sum amount equal to 50% (200% for Mr.Jackson) of the annual target bonus in effect for the named executive officer for the year in which the named executive officers involuntary termination occurs; and |
|
Accelerated vesting as to 50% of the named executive officers unvested equity awards that are outstanding immediately prior to the named executive officers involuntary termination. |
Under the Amended Severance Agreements, if, outside of the Change
in Control Period, a named executive officer has an involuntary
termination, then, provided such named executive officer timely
executes and does not revoke a release of claims, complies with
his or her obligations under the named executive officers PIIA,
and complies with the non-solicitation provision in the named
executive officers Amended Severance Agreement, such named
executive officer will receive the following benefits:
|
Continued payment of his or her base salary as then in effect for 18 months for Mr.Jackson, 15 months for Mr.Montes, or 12 months for Mr.Callan and Ms.Wilford; and |
|
Reimbursement of COBRA premiums on a tax-neutral basis for the named executive officer and his or her qualified dependents for 18 months for Mr.Jackson, 15 months for Mr.Montes, or 12 months for Mr.Callan and Ms.Wilford. |
| In the case of Mr.Jackson only: |
|
An additional 18 months of vesting for all stock options that are outstanding on the date of his involuntary termination that are subject solely to time-based vesting; and |
|
With regard to equity awards that (i)are eligible to vest, in whole or in part, based on the achievement of one or more performance metrics and (ii)were granted more than 12 months before his involuntary termination, Mr.Jackson will be eligible to vest in each award as to (x)the portion of such award that otherwise would be eligible to vest based on actual achievement of the relevant performance metrics during the full performance period multiplied by (y)a fraction where the numerator is the total number of calendar days between the beginning of the applicable performance period and the date of the involuntary termination and the denominator is the total number of days in the performance period. |
or
|
In the event his involuntary termination is due to his death or incapacity (as defined in his Amended Severance Agreements), then 50% of the unvested portion of each of his equity awards will become immediately vested and exercisable. |
Each Amended Severance Agreement provides that, if, outside of
the Change in Control Period, a named executive officer has an
involuntary termination, then, provided such named executive
officer timely executes and does not revoke a release of claims
and complies with his or her obligations under the named
executive officers PIIA, such named executive officer will
receive the following benefits:
|
Continued payment of his or her base salary as then in effect for one month; and |
|
Reimbursement of COBRA premiums on a tax-neutral basis for the named executive officer and his or her qualified dependents for one month. |
If Mr.Jacksons employment with us terminates due to his death or
incapacity, then he will receive the severance benefits described
above, subject to complying with the terms and conditions
described above.
If the employment of Mr.Montes, Mr.Callan, or Ms.Wilford
terminates with us due to his or her death or incapacity (as
defined in the applicable Amended Severance Agreement) and such
named executive officer holds one or more unvested equity awards
immediately prior to such termination, then 50% of the unvested
portion of each of his or her equity awards will become
immediately vested and exercisable. In addition, he or she will
receive the COBRA reimbursements and corresponding tax
gross-up payments
described above, subject to compliance with the terms and
conditions described above.
If any of the
severance and other benefits provided for in an Amended Severance
Agreement or otherwise payable to a named executive officer (280G
Payments) constitute parachute payments within the meaning of
Section 280G of the Internal Revenue Code and could be subject to
excise tax under Section4999 of the Internal Revenue Code, then
the 280G Payments will be delivered in full or delivered as to
such lesser extent which would result in no portion of such
benefits being subject to excise tax, whichever results in the
greater amount of after-tax benefits to such
named executive officer. The Amended Severance Agreements do not
require us to provide any tax gross-up payment to any named
executive officer.
In addition, Mr.Jacksons
Amended Severance Agreement provides that he will continue to
serve as the chairman of our board of directors and our chief
executive officer. Mr.Jackson will continue to be paid a base
salary at the annualized rate of $750,000 and, for each year he
is employed by us, will be eligible to receive a cash bonus at a
target amount and dollar amount determined by the compensation
committee of our board of directors, but which target amount will
not be less than 50% of Mr.Jacksons base salary received during
such fiscal year. The actual bonus payable for each fiscal year
will depend on Mr.Jacksons performance and the extent to which
Mr.Jackson has achieved the performance goals established for him
for that year.
The foregoing description of
the Amended Severance Agreements does not purport to be complete
and is qualified in its entirety by reference to the full text of
the Amended Severance Agreements. A copy of the Amended Severance
Agreement with Mr.Jackson is filed as Exhibit 10.1 to this
Current Report on Form 8-K and incorporated herein by reference.
A copy of the Form of Amended and Restated Executive Severance
Benefit Agreement on which the Amended Severance Agreements with
the other named executive officers are based is filed as Exhibit
10.2 to this Current Report on Form 8-K and incorporated herein by
reference.
Item9.01 Financial
Statements and Exhibits
| (d) | Exhibits. |
Exhibit
Numbers
10.1 Third Amended and
Restated Employment Agreement between the Company and Joseph
Jackson dated April18, 2017.
10.2 Form of Amended and
Restated Executive Severance Benefit
Agreement.
About WageWorks, Inc. (NYSE:WAGE)
WageWorks, Inc. is engaged in administering Consumer-Directed Benefits (CDBs). The Company administers CBDs, including pre-tax spending accounts, such as Health Savings Accounts (HSAs), health and dependent care Flexible Spending Accounts (FSAs), and Health Reimbursement Arrangements (HRAs), as well as Commuter Benefit Services, including transit and parking programs, wellness programs, Consolidated Omnibus Budget Reconciliation Act and other employee benefits. Its CDB programs assist employees and their families in saving money by using pre-tax dollars to pay for certain of their healthcare, dependent care and commuter expenses. Employers financially benefit from its programs through reduced payroll taxes. Under its FSA, HSA and commuter programs, employee participants contribute funds from their pre-tax income to pay for qualified out-of-pocket healthcare expenses not covered by insurance, such as co-pays, deductibles and over-the-counter medical products, or for commuting costs. WageWorks, Inc. (NYSE:WAGE) Recent Trading Information
WageWorks, Inc. (NYSE:WAGE) closed its last trading session up +0.15 at 73.00 with 218,646 shares trading hands.
