TransAct Technologies Incorporated

06/09/2024 | Press release | Distributed by Public on 06/09/2024 20:21

Management Change/Compensation Form 8 K

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On September 4, 2024 (the "Effective Date"), TransAct Technologies Incorporated (the "Company") entered into employment agreements with each of John M. Dillon (the "CEO Employment Agreement"), the Company's Chief Executive Officer, and Steven A. DeMartino (the "CFO Employment Agreement"), the Company's President, Chief Financial Officer, Treasurer and Secretary (together, the "Executives").

Each of the Executives remains employed in the same position and with the same titles that he held prior to entering into his respective employment agreement (each, an "Employment Agreement"). Each Employment Agreement runs until the first anniversary of the Effective Date thereof and will automatically renew for successive one-year periods unless either party provides notice of non-renewal at least 90 days prior to the expiration of any such one-year period. A description of each Employment Agreement is set forth below.

CEO Employment Agreement

The CEO Employment Agreement replaces and supersedes the letter agreement, dated April 24, 2023, between Mr. Dillon and the Company in connection with his initial appointment as interim Chief Executive Officer, but does not affect the Confidential Information and Intellectual Property Agreement, entered into as of April 24, 2023, between Mr. Dillon and the Company. The CEO Employment Agreement will help to ensure that the Company continues to receive the benefits of Mr. Dillon's leadership for the foreseeable future following the removal of his "interim" status as Chief Executive Officer in May 2023.

· Compensation. Mr. Dillon is entitled to receive a base salary at an annualized rate of $618,000, subject to review and adjustment in the sole discretion of the Compensation Committee of the Company's Board of Directors (the "Compensation Committee"). Mr. Dillon is entitled to participate in the Company's annual incentive cash bonus program, which bonus is targeted at a percentage of Mr. Dillon's base salary based upon either Mr. Dillon's or the Company's attainment of one or more objective performance criteria to be established annually by the Compensation Committee. For 2024, Mr. Dillon's bonus is targeted at $206,000. Mr. Dillon is also eligible to receive annual grants of long-term equity incentive compensation under the Company's 2014 Equity Incentive Plan, as Amended and Restated in 2023 (the "Plan").
· Termination Severance Payments. Mr. Dillon is entitled to severance payments (other than in connection with a change in control) if his employment is terminated by the Company without "Cause" or if he terminates his employment for "Good Reason" (each as defined in the CEO Employment Agreement). If Mr. Dillon's employment is terminated by the Company without Cause or if he terminates his employment for Good Reason, the Company is required to provide, in addition to a payment of accrued salary and benefits, severance payments consisting of the following: (i) Mr. Dillon's then current base salary for a period of twelve (12) months; (ii) Mr. Dillon's annual cash bonus, if any, for the year prior to the termination, to the extent earned and unpaid; (iii) reimbursement (on an after-tax basis) of all of Mr. Dillon's premiums under the Company's group health plan for continuing his health care coverage for a period ending on the earlier of the date that is twelve (12) months after the date of termination or the date on which Mr. Dillon becomes eligible to be covered by the health care plan of another employer; and (iv) Mr. Dillon's target annual bonus for the year of termination, pro-rated for the portion of the fiscal year occurring prior to termination, for a period equal to one (1) year after the date of termination. Mr. Dillon's receipt of the severance payments described above is contingent upon Mr. Dillon executing a release of claims in the Company's favor. The treatment of any outstanding equity awards upon Mr. Dillon's termination of employment by the Company without Cause or by Mr. Dillon for Good Reason will be in accordance with the Plan and applicable award agreements under the Plan.