ASPEN AEROGELS, INC. Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
Equity Award Grants
On
These grants are intended to encourage ownership of shares by employees and their alignment with the longer-term value of the Company and its shareholders, retain the Grantees, and reward the Grantees for their performance, in accordance with the purposes of the 2014 Employee, Director and Consultant Equity Incentive Plan (the "2014 Plan").
In order for a tranche of this award to vest, both time and performance vesting conditions must be satisfied. For the time vesting condition, a tranche will vest at the later of (i) three years from the grant date or (ii) one year from the date when an applicable performance hurdle is achieved, subject to a maximum five-year vesting period for shares with respect to which the performance hurdle has been achieved. With respect to the performance vesting condition, as noted in the table below, there are three tranches with different share price hurdles and a five-year total performance period. If a share price hurdle is not met after five years, the applicable tranche is forfeited. The share price hurdle is met by reference to a 30-day volume weighted average price (VWAP) that is maintained for 60 days. In the event of a Change of Control Sale of the Company, as defined in the Agreement, the share price hurdle is valued based on the per share value received by the Company's shareholders, with cash consideration valued at par, any publicly traded securities received as consideration valued at their 60-day VWAP as of the closing date of the Change of Control Sale of the Company, and any securities that are not publicly traded or for which a 60-day VWAP cannot be valued by the Board. Any of the tranches below could be earned at any point over the five-year period.
Tranche Performance Shares Weight Share Price Hurdle Tranche 1 34 % $ 43.33 Tranche 2 33 % $ 64.99 Tranche 3 33 % $ 86.65
In the event of a Change of Control Sale of the Company, a portion, capped at
100%, of the next unearned tranche would be earned in proportion to the excess
of the Change of Control Sale of the Company price above
• The numerator would be the excess of the Change of Control Sale of the
Company price over $18.66 .
• The denominator would be:
• The difference between the Tranche 1 share price hurdle and $18.66 ,
for Tranche 1
• The difference between the Tranche 2 share price hurdle and $18.66 ,
for Tranche 2
• The difference between the Tranche 3 share price hurdle and $18.66 ,
for Tranche 3
In the event of a Change of Control Sale of the Company, any earned shares would continue to be subject to the time-based vesting condition, provided, however, that if the successor company in the Change of Control Sale of the Company did not assume the Company's obligations under the Agreement, all earned shares would become vested as of immediately prior to the closing of the Change of Control Sale of the Company.
In the event the Company terminates a Grantee's service as an employee, director, or consultant of the Company for Cause or if the Board determines, within one year after the Grantee is terminated, that either prior or subsequent to the Grantee's termination that the Grantee's engaged in conduct that would constitute Cause, or if the Grantee's resigns without Good Reason, all shares granted pursuant to this award that remain unvested will be forfeited to the Company immediately as of the time the Grantee is notified that the Grantee has been terminated for Cause, that the Grantee engaged in conduct that would constitute Cause, or as of the effective time of the Grantee's resignation without Good Reason.
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In the event the Company terminates a Grantee without Cause or a Grantee resigns for Good Reason, or in the event of a Grantee's death or disability, all earned shares for which the performance vesting condition has been met and which are subject to the continued time vesting condition will vest. Further, in the event the Company terminates a Grantee without Cause or the Grantee resigns for Good Reason, a pro rata fraction, capped at 100%, of the next unearned tranche will be earned and vest based on the following formula. Any other unearned tranches will be forfeited.
• The numerator would be the excess of the 60-day VWAP of the Company's
common stock on a national securities exchange on the termination date
over the opening price for that tranche.
• The denominator would be:
• The difference between the Tranche 1 share price hurdle and $18.66 ,
for Tranche 1
• The difference between the Tranche 2 share price hurdle and the
Tranche 1 share price hurdle, for Tranche 2
• The difference between the Tranche 3 share price hurdle and the
Tranche 2 share price hurdle, for Tranche 3
Otherwise, in the event a Grantee is no longer an employee, director, or consultant of the Company or an affiliate prior to the achievement of a performance goal listed above, or the Company does not achieve a performance goal by the fifth anniversary of the grant date, the Grantee will immediately forfeit to the Company the number of shares granted that have not yet vested pursuant to the table above.
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