Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
Effective January 13, 2020, the board of directors of Airgain, Inc. (the
"Company") appointed David Lyle as the Company's Chief Financial Officer and
Secretary. Upon his appointment, Mr. Lyle will serve as the Company's principal
financial and accounting officer for filings under the Securities Act of 1933,
as amended (the "Securities Act") and the Securities Exchange Act of 1934, as
amended (the "Exchange Act").
Prior to joining the Company, Mr. Lyle, age 55, served as the Chief Financial
Officer of Sunniva, Inc. from June 2019 to November 2019. Prior to Sunniva, he
was Chief Financial Officer at Maxwell Technologies, Inc. from May 2015 to May
2019, which was acquired by Tesla in 2019. Mr. Lyle also served as the Chief
Financial Officer of Entropic Communications, Inc. from 2007 to 2015, which was
acquired in 2015 by MaxLinear, Inc. Prior to Entropic, he served as the Chief
Financial Officer of RF Magic Inc., acquired by Entropic in 2007, Zyray Wireless
Inc., acquired by Broadcom Corporation in 2004, and Mobilian Corporation,
acquired by Intel Corporation in 2003. He has also served in corporate finance
positions at large global companies, including Intel and Broadcom. Mr. Lyle was
the winner of 2011 San Diego Business Journal CFO of the Year, and Finalist in
the 2018 CFO of the Year Awards. Mr. Lyle holds a Bachelor of Science in
business administration from University of Southern California, a Master of
International Management from the Thunderbird School of Global Management, and a
Master of Business Administration from Arizona State University.
There are no family relationships between Mr. Lyle and any director or executive
officer of the Company, and he has no direct or indirect material interest in
any transaction required to be disclosed pursuant to Item 404(a) of Regulation
S-K.
In connection with the commencement of his employment, the Company entered into
an employment agreement (the "Employment Agreement") with Mr. Lyle, dated
January 13, 2020, pursuant to which he will receive an annual base salary of
$325,000 and will be eligible to receive an annual incentive bonus at an initial
target for calendar year 2020 of 60% of his annual base salary. Mr. Lyle is also
entitled to participate in all employee benefit plans, programs and arrangements
maintained by the Company and made available to employees generally and to
receive reimbursement for all reasonable and necessary business expenses
incurred on behalf of the Company.
Pursuant to the Employment Agreement, in connection with the commencement of his
employment on January 13, 2020, Mr. Lyle received stock options to purchase up
to 100,000 shares of the Company's common stock under the Company's 2016
Incentive Award Plan (the "Plan"). The stock options have an exercise price per
share equal to the closing price of the Company's common stock on the Nasdaq
Stock Market on the date of grant. The stock options will vest over a four-year
period, with 25% of the options vesting on the first anniversary of the date of
grant, and 1/48th of the original number of shares subject to the options
vesting on each one-month period thereafter, subject to Mr. Lyle's continued
service to the Company through the applicable vesting dates. The stock options
have a term of ten years from the date of grant. In addition, pursuant to the
terms of the Employment Agreement, in connection with the commencement of his
employment on January 13, 2020, Mr. Lyle received 35,000 Restricted Stock Units
("RSUs") under the Plan. The RSUs will vest over a four-year period in equal
installments on each of March 1, 2021, 2022, 2023 and 2024, subject to
Mr. Lyle's continued service to the Company through the applicable vesting
dates. The stock options and RSUs shall become fully vested in connection with
certain qualifying terminations of service within 60 days prior to or following
a change in control of the Company, as described in the Employment Agreement.
Pursuant to the Employment Agreement, if the Company terminates Mr. Lyle's
employment without cause (as defined in the Employment Agreement) or he resigns
for good reason (as defined in the Employment Agreement), in addition to the
payment of his fully earned but unpaid base salary through the date of
termination at the rate then in effect, plus all other amounts under any
compensation plan or practice to which he is entitled (the "Accrued
Obligations"), he will be entitled to the following severance and benefits,
subject to his execution of a release of claims against the Company: (1) a lump
sum cash payment in an amount equal to (i) 12 months of his annual base salary
as in effect immediately prior to the date of termination, plus (ii) his target
bonus for the calendar year during which his date of termination occurs
calculated as of the date of termination, prorated for such portion of
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the calendar year during which such termination occurs that has elapsed through
the date of termination, and (2) the continuation of his health insurance
coverage pursuant to COBRA at the Company's expense for a period of 12 months
following the date of termination. In addition, in the event of a termination
without cause or resignation for good reason within 12 months following a change
in control (as defined in the Employment Agreement), in addition to the payment
of all Accrued Obligations, Mr. Lyle will be entitled to receive the following
severance and benefits, subject to his execution of a release of claims against
the Company: (1) a lump sum cash payment in an amount equal to (i) 12 months of
his annual base salary as in effect immediately prior to the date of
termination, plus (ii) his full target bonus for the calendar year during which
such date of termination occurs; and (2) the continuation of his health
insurance coverage pursuant to COBRA at the Company's expense for a period of 18
months following the date of termination.
If Mr. Lyle is terminated as a result of his death or following his permanent
disability, in addition to the payment of all Accrued Obligations, he or his
estate, as applicable, is entitled to a lump sum cash payment in an amount equal
to his earned bonus for the calendar year during which his date of termination
occurs calculated as of the date of termination, prorated for such portion of
the calendar year during which such termination occurs that has elapsed through
the date of termination.
The foregoing 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, which will be filed as an exhibit to the Company's Annual
Report on Form 10-K to be filed with respect to the fiscal year ending
December 31, 2019.
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