Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain
Officers; Compensatory Arrangements of Certain Officers.
(a) Effective September 9, 2018, Michael Brauser has resigned as Executive Chairman and
as a member of the Board of Directors of Red Violet, Inc. (the Company). In accepting Mr. Brausers resignation, the Board of Directors of the Company has agreed to the continued vesting of Mr. Brausers RSUs in
accordance with the terms of his RSU agreement and continued compensation in accordance with the terms of his existing agreement with the Company. On September 9, 2018, the Companys Board of Directors appointed Derek Dubner, the
Companys Chief Executive Officer, as Interim Chairman of the Board of Directors.
(e) On September 5, 2018 (the Effective Date),
the Companys Compensation Committee approved the grant of performance and time vested Restricted Stock Units (RSUs) under its 2018 Stock Incentive Plan (the Plan) to certain of its executive officers and directors as
described below. Except as provided in the Plan, a recipients employment agreement or the award agreement, the RSU grants shall not vest unless and until the Company has, for any fiscal quarter in which the RSUs are outstanding, (i) gross
revenue determined in accordance with the Companys reviewed or audited financial statements in excess of $7.0 million for such fiscal quarter, (ii) positive adjusted EBITDA, also as determined based on the Companys reviewed or
audited financial statements for such fiscal quarter and reported on Companys Quarterly Reports on Form
10-Q
or Annual Reports on Form
10-K,
and (iii) the
participant continues to provide services to the Company either as an employee, director or consultant on the last date of the quarter that the performance criteria is met (collectively, (i-iii), the Performance Criteria). Revenue and
expenses from acquisitions made after the Effective Date and prior to the achievement of the Performance Criteria shall not be included in the determination of whether the Company has achieved the Performance Criteria. If the Performance Criteria
are met, the RSUs will vest
one-third
annually on July 1, 2019, July 1, 2020 and July 1, 2021 (Time-Based Vesting Requirement). If the Performance Criteria are met, any portion of
the RSUs which has passed a Time-Based Vesting Requirement date shall be issued in accordance with the distribution procedures in the award agreement. In the event of a Change of Control (as defined in the Plan), all RSUs which have not vested on
the date of such Change of Control shall immediately vest.
The foregoing is a summary of the terms of the RSU Award Agreement and is qualified in its
entirety by reference to the complete text of the RSU Award Agreement, which will be filed by the Company as an exhibit to its Quarterly Report on
Form 10-Q for
the quarter ending September 30,
2018.
On September 5, 2018, the Compensation Committee granted the following RSUs subject to the Time-Based Vesting Requirement and Performance
Criteria as described above to:
Michael Brauser 500,000
Derek Dubner 375,000
James Reilly 275,000
Daniel MacLachlan 275,000
Peter Benz 25,000
Steven D. Rubin 25,000
Robert Swayman 12,500