Sskillz, it looks like the current CEO of DFZ is getting a bonus AND beginning the process of stepping down.
From the 14a filed today:
" On February 24, 2005, the Company entered into an employment contract with Mr. Von Lehman (the “employment agreement”) for Mr. Von Lehman to continue to serve as President and Chief Executive Officer of the Company. The expiration date of the employment agreement was March 31, 2006. Under the employment agreement, Mr. Von Lehman received a monthly salary of $37,500 in addition to benefits provided to other senior executives of the Company. The agreement also provided for Mr. Von Lehman’s participation in the Company’s Annual Incentive Plan at a range of 20% to 80% of his annualized base salary, with a guaranteed cash bonus of $90,000 if Mr. Von Lehman remained employed by the Company on December 31, 2005. Mr. Von Lehman was paid a $200,000 bonus for the 2005 fiscal year in early 2006. Mr. Von Lehman also received under the employment agreement options covering a total of 100,000 common shares of the Company and the right to a transaction success fee in the event of the sale of the Company. The cash compensation, options and other benefits paid or provided to Mr. Von Lehman under the employment agreement were the result of negotiation between the Compensation Committee and Mr. Von Lehman. The Compensation Committee concluded that it was critically important to the Company’s future to retain Mr. Von Lehman so he could continue to implement the Company’s new business model that began in March 2004 when Mr. Von Lehman was first employed by the Company.
and
On March 30, 2006, the Company and Mr. Von Lehman entered into a new employment agreement. The term of the new agreement is April 1, 2006 through September 30, 2006 and this new agreement supersedes the 2005 employment contract in its entirety. During the term, Mr. Von Lehman will step down from his position as Chief Executive Officer of the Company when requested to do so by the Board, but will continue as an employee of the Company through September 30, 2006 to assist on special matters and to help transition the position of Chief Executive Officer to Mr. Tunney as discussed below. Mr. Von Lehman will also agree not to compete with the Company through March 31, 2008. The Company will continue to pay Mr. Von Lehman his monthly base salary of $37,500, and he will receive customary executive benefits through September 30, 2006. Additionally, Mr. Von Lehman will have the opportunity to earn a pro-rated bonus under the Company’s Annual Incentive Plan, and his right to specified compensation in the event of a “sale transaction” will remain unchanged. Mr. Von Lehman will remain a director of the Company and will be entitled to receive director fees and any other compensation paid to non-employee directors starting in October 2006.
On February 7, 2006, the Company entered into an executive employment agreement with Greg A. Tunney for Mr. Tunney to serve as the Company’s President and Chief Operating Officer. The agreement also provides that Mr. Tunney will be appointed the Chief Executive Officer of the Company no later than August 7, 2006. The initial term of the employment agreement will continue until Mr. Tunney is appointed to the position of Chief Executive Officer, and an additional three-year term will then begin upon conclusion of the initial term. The employment agreement will thereafter automatically renew for additional one-year periods unless either party gives 90 days’ prior written notice of such party’s intent not to renew.
Upon the execution of the employment agreement, Mr. Tunney received one-half of a $75,000 signing bonus, with the remaining one-half to be paid to him on the six-month anniversary of the date of the agreement. Mr. Tunney will receive compensation of $400,000 annually while he serves as President and Chief Operating Officer, with an increase to $450,000 annually upon his becoming Chief Executive Officer of the Company. Mr. Tunney will also be eligible for an annual performance bonus of 25% to 100% of his base salary and he will receive other various employee benefits, such as health and life insurance, vacation and sick leave and an automobile allowance. Pursuant to the terms of the employment agreement, on February 7, 2006, Mr. Tunney received a grant of 100,000 options. These options have an exercise price of $6.58 per share, have a seven-year term and will vest in three equal annual installments beginning February 7, 2007, unless certain events occur prior to that time.
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Perhaps some are unhappy with this move? Looks like Q1 net will take a hit too with the bonuses.
AI
