Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On September 13, 2021, Anthony Etnyre and the Board of Directors (the "Board")
of FTC Solar, Inc. (the "Company") agreed that Mr. Etnyre would step down from
his position as President and Chief Executive Officer of the Company, effective
as of September 23, 2021. Mr. Etnyre' s departure is not related to any
disagreement with the Company, and Mr. Etnyre has agreed to remain employed by
the Company for a transition period into 2022 in order to facilitate an
effective transition.
Also on September 13, 2021, the Board appointed Sean Hunkler to serve as the
President and Chief Executive Officer of the Company, effective as of September
24, 2021. Mr. Hunkler will also be appointed as a member of the Board as of the
same date, and will serve as a director until the Company's 2023 Annual Meeting
of Stockholders.
Mr. Hunkler has been with Western Digital since August of 2018, most recently
serving as the Executive Vice President of Global Operations, and having
previously served as the Senior Vice President, Global Operations, and as the
Senior Vice President, Manufacturing Operations. Prior to that, Mr. Hunkler
served as chief operating officer of Nexperia Semiconductors, a global
semiconductor manufacturer created after its divestiture from NXP
Semiconductors, from February 2017 to August 2018. From July 2012 to February
2017, he served as executive vice president, global operations of NXP
Semiconductors, a global semiconductor manufacturer. Mr. Hunkler also served in
senior leadership roles at Freescale Semiconductor, Motorola and SunEdison
(formerly MEMC Electronic Materials). He holds an MBA from the University of
Texas at Austin and a Bachelor's in Chemical Engineering from The John Hopkins
University.
In connection with Mr. Hunkler's appointment to the role of President and Chief
Executive Officer, the Company and Mr. Hunkler entered into an employment
agreement (the "Employment Agreement") dated September 13, 2021. Under the
Employment Agreement, Mr. Hunkler will commence employment on September 24, 2021
(referred to as the "Effective Date"). The Employment Agreement provides that:
• Mr. Hunkler's annual base salary will be $650,000, and his target annual
incentive award will be 100% of his annual base salary.
• Mr. Hunkler will be eligible to participate in the Company's long-term
incentive program as adopted by the Compensation Committee of the Board from
time to time in its discretion.
• Effective as of the Effective Date, Mr. Hunkler will be granted the following
equity awards, subject to the terms of the Company's 2021 Stock Plan: (i)
632,250 RSUs subject to a four-year installment vesting schedule based on
continued employment, (ii) a performance-based option to acquire 1,053,750
shares of the Company's common stock ("$30 Options"), granted at fair market
value, which will be subject to a four year installment vesting schedule
commencing on the first date after which the common stock has (a) closed above
$30 per share on both the first and last day of any 90 day period, (b) closed
above $30 per share on both the first and last day of any 60 trading day period
during such 90 day period and (c) closed above $30 per share on at least 45
trading days during such 60 trading day period, provided that the $30 Options
will be forfeited to the extent that such date has not occurred within 4 years
of the Effective Date or between the 4-year anniversary and the 7-year
anniversary of the Effective Date in certain circumstances, and (iii) a
performance-based option to acquire 1,053,750 shares of the Company's common
stock ("$60 Options"), granted at fair market value, under substantially the
same conditions as described for the $30 Options, replacing the $30 target with
$60; provided that the $60 Option will be forfeited to the extent that the
performance target has not been met prior to the 7-year anniversary of the
Effective Date.
• Mr. Hunkler will also receive a cash sign-on bonus of $500,000, payable in two
installments: $250,000 on the Effective Date and, if Mr. Hunkler then continues
to be employed by the Company, $250,000 on the first anniversary of the
Effective Date, subject to certain repayment provisions in the event that Mr.
Hunkler ceases to be employed for any reason prior to the first anniversary of
the Effective Date.
• If during the employment period the Company terminates Mr. Hunkler's
employment without cause or if he resigns for good reason (as such terms are
defined in the Employment Agreement), then, provided he is in compliance with
all applicable restrictive covenants and he signs a release which becomes
effective, Mr. Hunkler will be entitled to receive: (A) prior to a change in
control (as defined in the Employment Agreement), (x) cash severance equal to
1.5 times his base salary (or if greater the base salary as in effect prior to
the event giving rise to good reason), payable in substantially equal
installments over a
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period of 18 months, (y) in a lump sum at the same time bonuses are paid to
active employees generally, an amount equal to his annual bonus as determined by
the Compensation Committee of the Board, pro-rated for the number of days he was
employed during the applicable calendar year through the applicable termination
date, and (z) in a lump sum, a cash amount equal to the cost of COBRA benefits
for Mr. Hunkler, his spouse and eligible dependents for a period of 18 months,
or (B) within 12 months following a change in control, (i) in a lump sum, cash
severance equal to 2 times the sum of his base salary and the target bonus
(without regard to any reduction resulting in good reason), (ii) a prorated
annual cash bonus for the year in which the date of termination occurs, based on
actual performance to be paid at the same time as annual bonuses are paid to
other senior officers; (iii) in a lump sum, a cash amount equal to the cost of
COBRA benefits for Mr. Hunkler, his spouse and eligible dependents for a period
of 18 months, (iv) full vesting of any unvested equity-based awards (at target
level of achievement for any performance-based award) then held by Mr. Hunkler,
and (v) reimbursement of certain legal fees if incurred by Mr. Hunkler.
There are no arrangements or understandings between Mr. Hunkler and any other
persons pursuant to which he was selected as President and Chief Executive
Officer and director of the Company. There are also no family relationships
between Mr. Hunkler and any director or executive officer of the Company and he
has no direct or indirect material interest in any transaction required to be
disclosed pursuant to Item 404(a) of Regulation S-K.
The foregoing description of the Employment Agreement does not purport to be
complete and is qualified in its entirety by reference to the Employment
Agreement, which will be filed as an exhibit to the Company's Quarterly Report
on Form 10-Q for the quarter ending September 30, 2021.
Item 8.01 Other Events.
On September 14, 2021, FTC Solar, Inc. issued a press release announcing the
transition from Mr. Etnyre to Mr. Hunkler. A copy of the press release is
attached to this Current Report on Form 8-K as Exhibit 99.1 and is incorporated
into this Item 8.01 by reference.
Exhibit
Number Description
99.1 * Press Release of FTC Solar, Inc., dated September 14, 2021
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
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