Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Effective August 17, 2022, the Board of Directors (the "Board") of Basanite,
Inc. (the "Company") appointed Lisa H. Gainsborg, CPA as Chief Financial
Officer, Treasurer and Secretary of the Company. The following is certain
biographical information for Ms. Gainsborg:
Lisa H. Gainsborg, 56, has extensive knowledge and experience in accounting and
finance, including with regard to financial statement preparation, Securities
and Exchange Commission reporting requirements, Sarbanes-Oxley compliance, the
creation of accounting and reporting controls and procedures and enterprise
resource planning systems. Since 2019, through her certified public accounting
firms, Ms. Gainsborg has provided consulting services as a chief financial
officer as well as tax preparation services for companies. From December 2014
through October 2019, Ms. Gainsborg was the Vice President of Finance at Zero
Gravity Solutions, Inc., a publicly reporting company, where she was responsible
for preparing Securities and Exchange Commission filings and managing external
audits. Ms. Gainsborg also managed, reviewed, and provided the documentation for
tax returns for various federal and state filings. From August 2003 through
November 2016, Ms. Gainsborg served as President of A+ Accounting Services,
Inc., where she was responsible for managing, accounting, budgeting, and tax
services for clients. She also provided chief financial officer consulting
services and accounting system support for clients and also prepared corporate,
partnership, and individual tax returns. Ms. Gainsborg is a Certified Public
Accountant in Florida and Maryland and received a Bachelor of Business
Administration in Accounting from Hofstra University in 1989.
On August 17, 2022 (the "Start Date"), the Company and Ms. Gainsborg has entered
into an employment letter (the "Employment Letter") regarding her service with
the Company. Pursuant to the Employment Letter, Ms. Gainsborg' employment with
the Company shall be "at will" and may be terminated by either party on thirty
(30) days' prior written notice.
Ms. Gainsborg's base salary ("Base Salary") will be at a rate of One Hundred
Twenty-Five Thousand Dollars ($125,000) per year, payable in accordance with the
regular payroll practices of the Company. The Base Salary will be revisited for
possible upward adjustment at such time as the Company's common stock becomes
listed on a national securities exchange (including any tier of The Nasdaq Stock
Market). Ms. Gainsborg may receive an annual cash and/or equity in the sole
discretion of the Board. Such bonus shall be determined based on such factors as
the Board deems appropriate, including performance targets approved by the
Board. Ms. Gainsborg will also be eligible for equity grants pursuant to any
Company equity plan approved and adopted by the Board and the Company's
stockholders. Other than the Initial Option Grant (defined below), equity grants
to Ms. Gainsborg and the amounts thereof will be determined in accordance with
the metrics approved from time to time by Board.
As of the Start Date, Ms. Gainsborg was granted 5-year, non-qualified options to
purchase Seven Hundred Fifty Thousand (750,000) shares of Company common stock
(the "Initial Option Grant"). The Initial Option Grant was memorialized pursuant
to a Non-Qualified Stock Option Agreement (the "Option Agreement"). The exercise
price of the Initial Option Grant shall be $0.109, the closing price of the
Common Stock on the Start Date. The Initial Option Grant shall vest as follows:
(i) options to purchase Five Hundred Thousand (500,000) shares of common stock
shall vest in equal quarterly installments of Sixty-Two Thousand Five Hundred
(62,500) options over two (2) years from the Start Date and (ii) options to
purchase Two Hundred Fifty Thousand (250,000) shares of common stock shall vest
on the date that the Company reports (via its filings with the Securities and
Exchange Commission) two (2) consecutive quarters of positive cash flow from
operations. The Option Agreement contains customary terms regarding the
treatment of the options upon the death, disability or employment termination of
Ms. Gainsborg.
The Employment Letter contains customary confidentiality provisions.
The foregoing descriptions of the Employment Letter and Option Agreement are a
summary only and do not purport to be complete and, is qualified in its entirety
by reference to the full text of such documents, copies of which are attached
hereto as Exhibits 10.1 and 10.2, which full texts are incorporated herein by
reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
No. Description
10.1 Letter Agreement, dated August 17, 2022, between the Company and Lisa
H. Gainsborg
10.2 Non-Qualified Stock Option Agreement, dated August 17, 2022, between
the Company and Lisa H. Gainsborg
104 Cover Page Interactive Data File (the cover page XBRL tags are embedded
within the inline XBRL document)
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