Digital Turbine, Inc. (NASDAQ:APPS) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain OfficersItem 5.02
On March 16, 2018, Digital Turbine, Inc. (the “Company”) entered into a second amendment (the “Amendment”) to the employment agreement with William Stone originally entered into on September 9, 2014 and previously amended on May 26, 2016 (the “Employment Agreement”). The Amendment replaces the fixed term of the Employment Agreement, which would otherwise expire on March 31, 2018, with an at-will arrangement without a definite term. In addition, the Amendment: (i) establishes a new incentive compensation structure for future fiscal years consisting of annual cash and long term equity incentives described further below; (ii) provides pro-ration of certain annual cash and long term equity incentives in connection with payments for termination by the Company without cause or by Mr. Stone for good reason and changes the duration of severance payments to Mr. Stone in connection with such types of terminations following a change of control; and (iii) provides for a $100,000 signing payment to Mr. Stone.
The new bonus structure replaces the existing bonus structure commencing for the fiscal year ending March 31, 2019 and generally provides for annual cash incentives and long term equity incentives. The annual cash incentives will require attainment of revenue and earnings goals set by the independent Compensation Committee of the Board of Directors of the Company, after consultation with Mr. Stone, which will be based on a Board approved annual operating plan. The applicable goals will have three increasingly higher levels of revenue and earnings. The annual cash incentives will be for up to 25%, 50% or 50% of Mr. Stone’s base salary (currently $500,000 annually) based on the level of goal achievement. Even if revenue and earnings goals are fully achieved within any given level, 20% of the applicable bonus opportunity is in the sole discretion of the Compensation Committee based on exceptional results in compliance, operations and other areas the Committee deems appropriate.
The amount of any long term incentive (LTI) equity grants is within the sole discretion of the Committee in all cases, but if granted, would be structured to consist of time vesting and performance vesting restricted common stock units. Any LTI awards would be contingent on achievement of three year revenue and EBITDA goals, based on three increasingly higher levels of attainment established by the Compensation Committee, after discussion with Mr. Stone, based on a Board approved three year operating plan. The highest level of attainment would require revenue and EBITDA of at least 200% of the applicable revenue and EBITDA goals set by the Compensation Committee. Any time vesting awards will vest over three years after grant and any such awards that have not vested prior to any termination of Mr. Stone’s employment shall terminate. Any performance vesting awards will be earned on the third anniversary of the grant date provided Mr. Stone is employed through such date. Except in connection with terminations without cause or for good reason, if Mr. Stone’s employment with the Company terminates prior to the third anniversary of the applicable grant date, performance vesting units shall not vest and shall terminate immediately upon such termination of employment. Any performance vesting units shall be subject to a negative discretion clawback up into two years after the vesting date in connection with financial restatements or certain actions constituting cause. During such two year period any underlying shares are subject to a lock up.
Except as provided in the Amendment, and for technical and conforming changes, Mr. Stone’s Employment Agreement remains unchanged. The foregoing summaries of the Amendment does not purport to summarize all terms and is subject to, and qualified in its entirety by, the full text of the Amendment, which has been filed as an exhibit hereto.
| Item 9.01 | Financial Statements and Exhibits |
Digital Turbine, Inc. ExhibitEX-10.1 2 tv488923_ex10-1.htm EXHIBIT 10.1 Exhibit 10.1 SECOND AMENDMENT TO EMPLOYMENT AGREEMENT This Second Amendment (this “Amendment”) to the Employment Agreement (as defined below) is made and entered into as of March 16,…To view the full exhibit click here
About Digital Turbine, Inc. (NASDAQ:APPS)
Digital Turbine, Inc. is engaged in delivering end-to-end products and solutions for mobile operators, application advertisers, device original equipment manufacturers (OEMs) and other third parties to enable them to monetize mobile content. The Company operates its business in two operating segments: Advertising and Content. The Advertising segment consists of two businesses: Operator and OEM (O&O) and Advertiser and Publisher (A&P). The O&O business is an advertiser solution for carrier and OEM inventory consisting of services, such as Ignite, a mobile device management platform and Discover, an intelligent application discovery platform. Its A&P business is a mobile user acquisition network across the world consisting of services, such as syndicated network and real time bidding (RTB). The Content segment consists of services, including Marketplace, which is an application and content store, and Pay, which is a content management and mobile payment solution.