Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On January 7, 2022, Paul Walsh notified Allegro MicroSystems, Inc. (the
"Company") that he would retire from his position as Senior Vice President,
Chief Financial Officer and Treasurer of the Company, effective January 10,
2022. On January 10, 2022, the Board of Directors (the "Board") of the Company
appointed Derek P. D'Antilio to serve as Senior Vice President, Chief Financial
Officer and Treasurer of the Company, effective January 10, 2022 (the "Effective
Date"). Mr. Walsh will work closely with Mr. D'Antilio until February 4, 2022
(the "Separation Date") and after that will be available to consult with the
Company for a period of one year after the Separation Date (the "Consulting
Period") to ensure a smooth and orderly transition of responsibilities, pursuant
to a Consulting Agreement and General Release (the "Consulting Agreement") that
Mr. Walsh entered into with the Company effective January 10, 2022. The Company
and the Board express their appreciation to Mr. Walsh for his dedicated and
outstanding service to the Company and wish him well in his retirement.
In connection with Mr. D'Antilio's appointment as Senior Vice President, Chief
Financial Officer and Treasurer of the Company, the Company entered into an
offer letter with Mr. D'Antilio (the "Offer Letter"), as well as a severance
agreement (the "Severance Agreement"). The material terms and conditions of the
Offer Letter, Severance Agreement and Consulting Agreement are summarized below.
Mr. D'Antilio, age 49, most recently served as Chief Financial Officer of Harvey
Performance Company. From July 2019 through April 2021, he was Chief Financial
Officer of IDEX Biometrics ASA, a publicly traded, Norwegian global fabless
semiconductor company, where he helped guide their initial public offering in
the United States. Before joining IDEX Biometrics, Mr. D'Antilio spent eight
years at MKS Instruments, Inc., a global equipment and service provider to
semiconductor and industrial markets and held numerous leadership roles
including Vice President & Corporate Controller. Earlier in his career, Mr.
D'Antilio was a CPA in public accounting and served as an audit manager at PwC.
Mr. D'Antilio holds a B.S.B.A in Accounting from Salem State University and an
M.B.A. from Babson College.
Under the Offer Letter, Mr. D'Antilio's annual base salary will be $400,000, and
his annual target bonus will equal 75% of his annual base salary (pro-rated for
fiscal 2022 based on the partial year served). In addition to any pro-rated
target annual bonus that Mr. D'Antilio receives in 2022, under the Offer Letter,
Mr. D'Antilio is entitled to receive a $125,000 signing bonus within 30 days of
the Effective Date (the "Signing Bonus"). In the event that Mr. D'Antilio
voluntarily resigns within 12 months following the Effective Date, Mr. D'Antilio
will be required to repay the Signing Bonus. In the event that Mr. D'Antilio
voluntarily resigns between 12 and 24 months following the Effective Date, Mr.
D'Antilio will be required to repay a pro-rated amount of the Signing Bonus.
The Offer Letter also provides that, on the third trading day following the
Company's first quarterly earnings announcement following the Effective Date,
the Company will grant to Mr. D'Antilio restricted stock units representing a
number of shares of common stock having a grant date fair value of $1.5 million
divided by the closing price of a share of the Company's common stock on the
applicable grant date (the "RSUs"). The RSUs will vest as to 60% of the
underlying shares on the first anniversary of the grant date and as to the
remaining 40% of the underlying shares on the second anniversary of the grant
date, in each case, subject to Mr. D'Antilio's continued employment with the
Company through each vesting date. In addition, Mr. D'Antilio will be eligible
to participate in the Company's 2020 Omnibus Incentive Compensation Plan (the
"2020 Plan") with an annual target value of $1.5 million. Awards granted to Mr.
D'Antilio under the 2020 Plan will be subject to the approval of the
Compensation Committee of the Board. The Offer Letter provides that Mr.
D'Antilio's awards under the 2020 Plan will be granted in the form of time-based
and performance-based RSUs.
Pursuant to the Severance Agreement, Mr. D'Antilio's employment is terminable by
either the Company without cause or by Mr. D'Antilio for good reason. In the
event that Mr. D'Antilio's employment is terminated by the Company without
"cause" or by Mr. D'Antilio for "good reason," in each case as defined in the
Severance Agreement, then in addition to payment of any accrued amounts and
subject to Mr. D'Antilio's timely executing a release of claims and continuing
to comply with his restrictive covenant obligations, he will be entitled to
receive an amount equal to the sum of two times his then current base salary
plus two times his then current target bonus, payable in a lump sum within 15
days following the date of his termination, and reimbursement for additional
costs he incurs for continued coverage under the Company's group health
insurance under the Consolidated Budget
Reconciliation Act of 1985 ("COBRA") for up to 24 months. In the event that the
Company needs to include such COBRA reimbursements in Mr. D'Antilio's income,
the Company will make gross-up payments to Mr. D'Antilio for the taxes imposed
on him for up to 18 months following his termination date.
Pursuant to Mr. Walsh's Consulting Agreement, and subject to Mr. Walsh's
continued compliance with the restrictive covenants in any written agreements
between Mr. Walsh and the Company and his execution of a general release of
claims, Mr. Walsh will be entitled to receive (i) a single, lump-sum payment
equal to a prorated portion of his annual bonus for the 2022 fiscal year; (ii)
reimbursement for additional costs Mr. Walsh incurs for continued coverage under
the Company's group health insurance under COBRA for up to 12 months; and (iii)
a one-time grant of RSUs with a grant date value equal to the value attributable
to an additional 12 months of vesting of Mr. Walsh's equity awards under the
2020 Plan, which would otherwise be forfeited as of the Separation Date.
Item 7.01. Regulation FD Disclosure.
On January 10, 2022, the Company issued a press release announcing the
appointment of Mr. D'Antilio as Senior Vice President, Chief Financial Officer
and Treasurer of the Company. A copy of the press release is attached as Exhibit
99.1 and incorporated herein by reference.
The information set forth in this Item 7.01, including Exhibit 99.1, is being
furnished and shall not be deemed "filed" for purposes of Section 18 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise
subject to the liabilities of that Section. The information in this Item 7.01,
including Exhibit 99.1, shall not be deemed incorporated by reference into any
filing under the Securities Act of 1933, as amended, or the Exchange Act, except
as shall be expressly set forth by specific reference in such a filing.
Item 9.01. Financial Statements and Exhibits.
Exhibit No. Description
Exhibit 99.1 Press Release issued by Allegro MicroSystems, Inc. on January
Exhibit 104 Cover Page Interactive Data File (formatted as Inline XBRL and
contained in Exhibit 101).
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