Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers
(c) On January 20, 2021, Limelight Networks, Inc. ("Limelight") announced that
Bob Lyons, previously CEO at Alert Logic, has been named President and CEO and
will join Limelight and the Board of Directors effective February 1, 2021. Bob
Lento, President, CEO, and Director since 2012, is retiring.
Mr. Lyons joins Limelight as President and CEO and brings a 25-year track record
of successfully unlocking enterprise value through strategic revitalization,
improved profitability, and growth. Mr. Lyons is an accomplished executive with
extensive experience building and executing value creation strategies across
various industry segments including telecommunications, tech, healthcare,
financial services, computing, and software. Prior to joining Limelight, from
2018 to 2021, Mr. Lyons was most recently CEO of Alert Logic, a global leader in
cybersecurity, specifically in managed threat detection and response. There, he
led the company through a multi-year strategic reposition that resulted in
becoming a global leader in cybersecurity, specifically in managed threat
detection and response. Prior to Alert Logic, from 2014 to 2018, Mr. Lyons held
executive positions, including President, at Connexions Loyalty/Affinion Group,
a leader in customer engagement and loyalty solutions. Mr. Lyons has also
previously held executive positions at Ascend Learning, Stream Global Services,
Avaya, Convergys, and United Health Care. Mr. Lyons earned his master's degree
in management and technology from Rensselaer Polytechnic Institute in Troy, New
York, and a bachelors' degree in business management from Moravian College in
Bethlehem, Pennsylvania.
Limelight entered into an employment agreement with Mr. Lyons (the "Agreement").
The Agreement provides that Mr. Lyons will commence performance of duties on
February 1, 2021 (the "Effective Date"). Mr. Lyons will receive a base salary of
$550,000 and he is eligible to receive a target annual cash incentive bonus of
$550,000 for calendar year 2021, which shall be prorated for the portion of
calendar year 2021 during which Mr. Lyons is employed with Limelight. The actual
earned annual cash incentive, if any, will be payable upon the achievement of
performance goals established or approved by the Board or by the Compensation
Committee ("Committee") of the Board.
Limelight shall also pay Mr. Lyons a one-time signing bonus of $450,000, less
applicable withholdings (the "Signing Bonus"). 50% of the Signing Bonus will be
payable on the Effective Date and 50% on the six-month anniversary of the
Effective Date, provided Mr. Lyons continues to be the CEO through each such
date. All amounts paid to Mr. Lyons pursuant to this Signing Bonus shall be
deemed a recoverable draw to be paid back to Limelight, if Executive's
employment as CEO is terminated by Limelight for Cause or by Mr. Lyons without
Good Reason prior to the one-year anniversary of the Effective Date.
Subject to Committee approval, on the grant date(s) set by the Committee,
Limelight will issue to Mr. Lyons $4,000,000 worth of equity awards in the form
of Restricted Stock Units ("RSUs") and an option to purchase shares of
Limelight's common stock ("Options") pursuant to our Amended and Restated 2007
Equity Incentive Plan (the "Plan"). These awards will be issued on the second
trading day following the opening of Limelight's trading window for executive
officers following the dissemination of Limelight's fourth quarter 2020 earnings
announcement. The initial equity award will be split in value between RSUs and
Options, with 40% of the value represented by RSUs and 60% represented by
Options. One-third (1/3) of the RSUs will vest on March 1, 2022, and the
remaining two-thirds (2/3) will vest in equal quarterly installments thereafter
for two additional years, provided Mr. Lyons continues to be a Service Provider
through each such vesting date. One-third (1/3) of the Options will vest on the
first anniversary of the Effective Date, and the remaining two-thirds (2/3) will
vest in 24 equal monthly installments, beginning one month after the first
anniversary of the Effective Date, provided Mr. Lyons continues to be a Service
Provider through each such vesting date.
In the event that Mr. Lyons' employment is terminated by Limelight without Cause
or if Mr. Lyons terminates voluntarily for Good Reason, and the termination is
not in Connection with a Change of Control, as each such term is defined in the
Agreement, Mr. Lyons will receive continued payment of his base salary for the
year in which the termination occurs for 12 months, the actual earned cash
incentive, if any, payable to Mr. Lyons for the year in which the termination
occurs, pro-rated to the date of termination, and reimbursement for premiums
paid for
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continued health benefits under Limelight's health plan until the earlier of 12
months or the date upon which Mr. Lyons and his eligible dependents become
covered under similar plans.
In the event that Limelight consummates a Change of Control transaction, defined
as the consummation of a merger or consolidation or the approval of a plan of
complete liquidation or for the sale or disposition of all or substantially all
of Limelight's assets, 50% of Mr. Lyons' then outstanding unvested equity awards
will vest immediately.
In the event that Mr. Lyons' employment is terminated by Limelight without Cause
or if Mr. Lyons terminates voluntarily for Good Reason, and the termination is
in connection with the Change of Control, as each such term is defined in the
Agreement, Mr. Lyons will receive continued payment of his base salary for the
year in which the termination occurs for 12 months, payment in an amount equal
to 100% of Mr. Lyons' Target Annual Incentive for the year in which the
termination occurs, 100% of Mr. Lyons' then outstanding unvested equity awards
will vest, and Mr. Lyons will receive reimbursement for premiums paid for
continued health benefits under Limelight's health plans until the earlier of 12
months or the date upon which Mr. Lyons and his eligible dependents become
covered under similar plans.
In the event that Mr. Lyons' employment is terminated due to death or
Disability, 25% of Mr. Lyons' then unvested equity awards shall vest.
In connection with his service as CEO, Mr. Lyons will establish a residence in
the greater Phoenix area.
Additionally, Limelight and Mr. Lento entered into a transition agreement and
employment agreement amendment (the "Transition Agreement"). Under the terms of
the Transition Agreement, Mr. Lento will remain with Limelight as a strategic
advisor to the CEO until December 31, 2021 (the "Separation Date"). Effective
February 1, 2021, Mr. Lento's base will be reduced to $22,727.27 per month. Mr.
Lento's current outstanding equity awards will continue to vest through the
Separation Date.
The foregoing descriptions of the Employment Agreement and the Transition
Agreement are qualified in their entirety by reference to the Employment
Agreement and Transition Agreement, respectively.
On January 20, 2021, Limelight issued a press release regarding these leadership
transitions. The press release is filed with this report on Form 8-K as Exhibit
99.1 and is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits.
Exhibit Number Description
99.1 Press Release of Limelight Networks, Inc. dated January 20,
2021.
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