NORTECH SYSTEMS INC filed on Wed, Sep 11 8-K

NORTECH SYSTEMS INC revealed 8-K form on Sep 11.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(b) On September 9, 2019, Nortech Systems Incorporated (the ‘Company’) entered into an Employment Agreement with Heidi Grange (the ‘Grange Agreement’) as the Company’s Senior Vice President of Human Resources effective September 9, 2019. The term of the Grange Agreement continues until September 30, 2020 which will automatically renew for successive one-year renewal terms unless either party notifies the other party in writing at least ninety days prior to expiration. Under the Grange Agreement, Ms. Grange is entitled to receive a salary equivalent to a monthly amount of $215,000 and is eligible to participate in the Company’s benefit plans. Ms. Grange is eligible for bonus compensation based upon satisfaction of specific criteria to be determined each calendar year, with a stated payout percentage of up to 40% of base salary under the bonus plan, of which $60,000 is guaranteed to Ms. Grange for the 2019 calendar year.

Upon entering into the Grange Agreement, and pursuant thereto, the Company granted Ms. Grange a 16,700 share non-qualified stock option under the Company’s 2017 Stock Incentive Plan that will vest annually in five equal installments. The stock option has an exercise price equal to the fair market value of the Company’s common stock on the grant date and expires on September 9, 2029.

Under the Grange Agreement, if Ms. Grange’s employment is terminated by the Company without Cause (as defined in the Grange Agreement) or by Ms. Grange for Good Reason (as defined in the Grange Agreement), so long as she has signed and has not revoked a release agreement, she will be entitled to receive severance comprised of (i) her base salary in effect at time of termination for the longer of (a) the remainder of the term of the Grange Agreement or (b) nine months and (ii) certain benefits set forth in the Grange Agreement.

If Ms. Grange’s employment is terminated within 12 months after a Change of Control (as defined in the Grange Agreement) by the Company without Cause, so long as she has signed and has not revoked a release agreement, she will be entitled to receive severance comprised of (i) her base salary in effect at time of termination for the longer of (a) the remainder of the term of the Grange Agreement or (b) nine months and (ii) certain benefits set forth in the Grange Agreement.

The foregoing summary of the Grange Agreement is qualified in all respects by the Grange Agreement, a copy of which is attached hereto as Exhibit 10.1 and incorporated herein by this reference.

(b) On September 9, 2019, Nortech Systems Incorporated (the ‘Company’) entered into an Employment Agreement with John Lindeen (the ‘Lindeen Agreement’) as the Company’s Senior Vice President of Global Operations. The term of the Lindeen Agreement continues until September 30, 2020 which will automatically renew for successive one-year renewal terms unless either party notifies the other party in writing at least ninety days prior to expiration. Under the Lindeen Agreement, Mr. Lindeen is entitled to receive a salary equivalent to a monthly amount of $211,750 an is eligible to participate in the Company’s benefit plans and equity incentive plans. Mr. Lindeen is eligible for bonus compensation based upon satisfaction of specific criteria to be determined each calendar year, with a stated payout percentage of up to 40% of base salary under the bonus plan.

Under the Lindeen Agreement, if Mr. Lindeen’s employment is terminated by the Company without Cause (as defined in the Lindeen Agreement) or by Mr. Lindeen for Good Reason (as defined in the Lindeen Agreement), so long as he has signed and has not revoked a release agreement, he will be entitled to receive severance comprised of (i) his base salary in effect at time of termination for the longer of (a) the remainder of the term of the Lindeen Agreement or (b) nine months and (ii) certain benefits set forth in the Lindeen Agreement.

If Mr. Lindeen’s employment is terminated within 12 months after a Change of Control (as defined in the Lindeen Agreement) by the Company without Cause, so long as he has signed and has not revoked a release agreement, he will be entitled to receive severance comprised of (i) his base salary in effect at time of termination for the longer of (a) the remainder of the term of the Lindeen Agreement or (b) nine months and (ii) certain benefits set forth in the Lindeen Agreement.

The foregoing summary of the Lindeen Agreement is qualified in all respects by the Lindeen Agreement, a copy of which is attached hereto as Exhibit 10.2 and incorporated herein by this reference.

(b) On September 9, 2019, Nortech Systems Incorporated (the ‘Company’) entered into an Amendment to Employment Agreement with Constance Beck, the Company’s Chief Financial Officer and Vice President (“Beck Amendment”) effective as of January 8, 2019. Under the terms of the Beck Amendment, the term of Ms. Beck’s employment continues until January 8, 2020 which will automatically renew for successive one-year renewal terms unless either party notifies the other party in writing at least ninety days prior to expiration.

The foregoing summary of the Beck Amendment is qualified in all respects by the Beck Amendment, a copy of which is attached hereto as Exhibit 10.3 and incorporated herein by this reference.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

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