UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On August 30, 2022, on the recommendation of the Compensation Committee of the Board of Directors of the Company, the Board of Directors approved:
· | an Amended and Restated Employment Agreement (Employment Agreement) for the Company’s Chief Executive Officer (CEO), Emanuel N. Hilario, which adds one year to the term and modifies his prior employment agreement to provide that any equity awards subject to vesting will vest immediately before a change of control of the Company, as defined in the agreement; and |
· | an award to Mr. Hilario of an aggregate of 600,000 restricted stock units (RSUs) comprising (a) 100,000 RSUs that will be settled in equal installments of common stock annually at August 31 over four years, beginning in 2023, based on Mr. Hilario’s continued employment, and (b) 500,000 RSUs that will be earned based on attaining 15% year-over-year increases in the volume-weighted average stock prices over any consecutive 20 trading days (VWAP) during four consecutive 12-month attainment periods beginning on August 31, 2022. |
Each of the Company and Mr. Hilario signed the employment agreement and RSU agreements on September 2, 2022.
Each of the RSU agreements governing the awards is substantially in the form the Company has used for prior RSU awards, except that, consistent with the Employment Agreement, each of the awards will vest and be settled in shares of Company common stock immediately before a change of control of the Company, as defined in the Employment Agreement. Unearned performance-based RSUs will be earned in future attainment periods if the VWAP target for that period is met. Performance-based RSUs may also be earned in advance and, if earned, convert into time-vesting RSUs that vest at the end of the applicable future attainment period.
The equity grants to Mr. Hilario are the result of a comprehensive review of his compensation that began in 2021, with the goals of bringing Mr. Hilario’s overall compensation in line with that of CEOs in a selected Company peer group and to further align his interests closely with the stockholders of the Company. In September 2021, the Company awarded time-vested RSUs to Mr. Hilario, but deferred consideration of additional equity awards to Mr. Hilario and to other senior members of management pending stockholder approval of an increase in the number of shares available under the Company’s 2019 Equity Incentive Plan. In connection with soliciting stockholder approval of the increase, the Company disclosed that the Committee had had preliminary discussions regarding an additional performance-based award for Mr. Hilario.
The above summary is qualified by reference to the Amended and Restated Employment Agreement dated September 2, 2022 and to each of the notices of grants of RSUs dated September 2, 2022, all of which are filed as exhibits to this report and the text of which are incorporated herein.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
See Exhibit Index.
Exhibit Index
Exhibit | Description |
10.1 | Amended and Restated Employment Agreement between Emanuel N. Hilario and the Company dated September 2, 2022. |
10.2 | Notice of Grant of Restricted Stock Units (Time-Vesting) dated September 2, 2022 between Emanuel N. Hilario and the Company. |
10.3 | Notice of Grant of Restricted Stock Units (Performance-Vesting) dated September 2, 2022 between Emanuel N. Hilario and the Company. |
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: September 7, 2022 | THE ONE GROUP HOSPITALITY, INC. | |
By: | /s/ Tyler Loy | |
Name: | Tyler Loy | |
Title: | Chief Financial Officer |