Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Effective January 1, 2021, IZEA Worldwide, Inc. (the "Company") entered into a
new employment agreement with Ryan S. Schram, the Company's Chief Operating
Officer (the "Employment Agreement"), with an initial term commencing January 1,
2021 and ending on January 1, 2024. This agreement supersedes, amends and
restates the former employment agreement between the Company and Mr. Schram
dated January 1, 2015. In connection with the Employment Agreement, the Company
appointed Mr. Schram to the position of President and Chief Operating Officer.
Pursuant to the Employment Agreement, Mr. Schram will receive an annual base
salary of $300,000 with a guaranteed base salary increase of no less than 2% in
January of each year beginning in 2022. The Employment Agreement provides for
annual stock options valued at $25,000 vesting over four years in equal monthly
installments. However, the number of underlying shares of common stock in each
annual stock option award shall not exceed 100,000 shares. In the event the fair
market value of the stock option grant is less than $25,000 as limited by the
100,000 share maximum, Mr. Schram will be entitled to receive the difference in
fair market value through in cash or restricted stock units with the same
vesting schedule as the stock options, at the sole discretion of the Board of
Directors. Additionally, Mr. Schram is also eligible to receive quarterly cash
bonuses based on the Company's revenue and he is eligible for an annual bonus up
to $100,000 in cash and up to $25,000 in stock options (subject to a
100,000-share maximum, with any resulting difference in value to be paid in cash
at 50% of the value or restricted stock units at 100% of the value, at the sole
discretion of the Board of Directors) based on the achievement of specified
annual and quarterly performance goals, to be paid quarterly pursuant to the
terms of the Employment Agreement. Each grant of bonus stock options or
restricted stock units shall vest over one year in equal monthly installments.
Following the initial term, the Employment Agreement will automatically renew
for successive one-year terms unless the Company or Mr. Schram provides written
notice of non-renewal at least three months prior to the end of the current term
or the Employment Agreement is otherwise terminated pursuant to its terms. The
Employment Agreement is subject to early termination (i) by the Company or Mr.
Schram for any reason upon written notice, (ii) by the Company for cause (as
such term is defined in the Employment Agreement), (iii) by Mr. Schram for good
reason (as such term is defined in the Employment Agreement), and (iv) in the
case of Mr. Schram's death or disability. If the Employment Agreement is
terminated for any reason other than by the Company for cause or by Mr. Schram
without good reason, Mr. Schram will be entitled to payment of expenses, accrued
and unused vacation time, severance of six months of his then current salary and
bonuses as calculated in the prior six months and twelve months of COBRA
payments. In the case of termination due to disability, Mr. Schram will be
entitled to severance of his then current salary until such time (but no more
than 120 days after such disability) that disability insurance plan payments
commence. If there is a change of control (as defined in the Employment
Agreement) and Mr. Schram's employment terminates within six months following
the change of control for reasons other than for cause or without good reason,
then Mr. Schram will be entitled to severance of twelve months of his then
current salary and twelve months of COBRA payments. Additionally, upon a change
of control (as such term is defined in the Employment Agreement), Mr. Schram's
unvested equity awards will be subject to acceleration pursuant to the terms of
the Employment Agreement.
The Employment Agreement also contains covenants restricting Mr. Schram from
engaging in any activities competitive with the Company's business during the
term of the Employment Agreement and for a period of up to one year thereafter,
and prohibiting him from disclosure of confidential information regarding the
Company.
The foregoing summary description of the Employment Agreement does not purport
to be complete and is qualified in its entirety by reference to the full text of
the Employment Agreement, a copy of which is attached hereto as Exhibit 10.1 and
incorporated herein in its entirety by reference.
Item 7.01. Regulation FD Disclosure.
On January 6, 2021, the Company issued a press release announcing Mr. Schram's
appointment as President and Chief Operating Officer. A copy of the press
release is being furnished as Exhibit 99.1 to this Current Report on Form 8-K
and is incorporated into this Item by reference.
On January 6, 2021, the Company filed a press release stating that the Company
has regained compliance with The Nasdaq Stock Market LLC ("Nasdaq") Listing Rule
5450(a)(1), which requires the Company's common stock to maintain a minimum bid
price of $1.00 per share. The Nasdaq staff made this determination of compliance
after the closing bid price of the Company's common stock was at $1.00 per share
or greater for the prior 10 consecutive business days. A copy of the press
release is being furnished as Exhibit 99.2 to this Current Report on Form 8-K
and is incorporated into this Item by reference.
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The information in Item 7.01 of this Current Report on Form 8-K and Exhibit 99.1
attached hereto is intended to be 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. This
information shall not be deemed incorporated by reference into any filing under
the Securities Act of 1933, as amended, or the Exchange Act, except as expressly
set forth by specific reference therein.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits.
Exhibit No. Description
10.1 Amended and Restated Employment Agreement, dated as of January 1,
2021, between IZEA Worldwide, Inc . and Ryan S. Schram
99.1 Press Release issued by IZEA Worldwide, Inc. on January 6, 2021
99.2 Press Release issued by IZEA Worldwide, Inc. on January 6, 2021
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