Cuentas Inc 8-K, filed Aug 24, 2022
Cuentas Inc. (CUEN)
About this 8-K
Cuentas Inc filed this 8-K on August 24, 2022, reporting on events of August 18, 2022.
Items reported
- Item 5.02: Director or officer change, or executive pay
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of
earliest event reported): August 24, 2022 (
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) |
(Commission file number) |
(IRS Employer Identification No.) |
(Address of principal executive offices)
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| The Stock Market LLC | ||||
| The Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Appointments of Arik Maimon as Interim CEO and Michael De Prado as Interim President
On August 19, 2022, the Company's Board of Directors approved a motion to appoint Arik Maimon as Interim CEO (in addition to his current position as Chairman of the Board) and Michael De Prado as Interim President (in addition to his current position as Vice Chairman of the Board). Both Maimon and De Prado agreed to assume these positions with no additional compensation. The Board also authorized the formation of a CEO Search committee.
Departure of Jeffery D. Johnson as Chief Executive Office
On August 18, 2022, Jeffery D. Johnson signed a Separation of Employment Agreement between himself and the Company, and resigned as the chief executive officer of the Company effective immediately. On August 19, 2022, the Board of Directors approved the Separation and General Release Agreement, approved the immediate acceleration of the vesting of 160,000 options previously issued under the Stock Option Plan that will be exercisable for a period of three years after the resignation and noted that the separation was cordial and positive.
Mr. Johnson will receive a one time Separation Payment of $100,000.00, and the Company will pay all costs for COBRA (health insurance) benefits through the end of calendar year 2022.
On August 23, 2022, the Company issued a press release announcing the appointment of Mr. Maimon as Interim CEO, Mr De Prado as Interim President and the departure of Mr. Johnson. A copy the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Description | |
| 10.1 | Separation Agreement, dated as of August 18, 2 022, by and between Cuentas, Inc. and Jeffery D. Johnson | |
| 99.1 | Press release dated August 23, 2022 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| CUENTAS INC. | ||
| Date: August 24, 2022 | By: | /s/ Arik Maimon |
| Arik Maimon Interim Chief Executive Officer | ||
Exhibit 10.1
SEPARATION OF EMPLOYMENT AGREEMENT
August 18, 2022
Via hand-delivery
Mr. Jeff Johnson
| Re: | Separation of Employment Agreement and related agreements and mutual general release between Mr. Johnson and Cuentas, Inc. |
Dear Mr. Johnson:
This letter agreement (the "Agreement") sets forth the terms and conditions of the agreement between you and Cuentas, Inc. (the "Company") regarding the cancellation of that certain Employment Agreement, Stock Option Agreement, and any and all related agreements between the parties (collectively, the “Employment Agreements”) and your separation of employment from the Company and the benefits being offered to you in exchange for entering into this Agreement and your release of any and all claims under the Employment Agreements.
1. Last Day of Employment. Your employment as the Chief Executive Officer of the Company will end on the date the parties execute this Agreement (the "Separation Date ") and you will resign from any and all related positions and any applicable accounts.
2. The Employment Agreements are canceled and the parties shall have no further obligations under them. After the execution of this Agreement, the only obligations between you and the Company are those set forth in this Agreement.
3. Final Compensation. You will be paid ONE HUNDRED THOUSAND DOLLARS ($100,000, the “Separation Payment”) in full satisfaction of any and all compensation, whether earned, accrued, deferred or otherwise that may be due under the Employment Agreements, and you will be responsible as a 1099 wage earner with paying any and all applicable payroll or related withholding taxes. Other than the Separation Payment, you stipulate, agree and acknowledge that no other compensation is due and owing to you and that you will not seek the payment of any further compensation that would otherwise come due under the Employment Agreements.
4. Amendment to Stock Option. As soon as practicable after execution of this Agreement, the Board of Directors shall amend your currently outstanding Stock Option (as defined below) to (i) reflect the immediate acceleration of the vesting of 160,000 options issuable under the Stock Option and (ii) revise the expiration date of such Stock Option to allow you to exercise the vested portion of the Stock Option for a period of three years from the Separation Date. For purposes hereof, “Stock Option” means that certain stock option to purchase up to 500,000 shares of Company common stock at an exercise price of $2.80 per share which was granted on November 3, 2021 and has the following vesting schedule: 125,000 shares vested on the date the Company received shareholder approval of the 2021 Share Incentive Plan, and 187,500 shares vest on each successive anniversary date of your Employment Agreement until fully vested. For avoidance of doubt, following execution of this Agreement and amendment of the Stock Option, the Stock Option shall allow you to exercise an option to purchase 285,000 shares at an exercise price of $2.80 per share of a period of three years from the Separation Date. No further vesting shall occur under the Stock Option and you shall not be entitled to any further issuances of securities from the Company under the 2021 Share Incentive Plan or otherwise.
5. Benefits. Under separate cover, you will receive additional information about your rights under the Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA") to continue your group health insurance coverage after the Separation Date. To continue your coverage, you must file the required election form and timely pay the required premiums. Company shall pay all costs for COBRA benefits continuation through the end of calendar year 2022.
6. Severance Benefits. In exchange for the Separation Payment and the Option and your agreeing to and complying with the terms of this Agreement, including the general release of claims contained in Section 6, you stipulate and agree that you are not entitled to any further compensation or benefits of any kind or nature including ("Severance Pay") in accordance with the Company's standard payroll procedures.
7. General Release of All Claims. In consideration for receiving the Separation Payment and the Option described in Sections 3 and 4 above, to the fullest extent permitted by law, you waive, release, and promise never to assert any claims or causes of action, known or unknown, against the Company, including its past or present parents or subsidiaries, and their employees, agents, predecessors, successors, and assigns (“the Released Parties”), regarding any matter arising out of or related to your employment with or separation of employment from the Company, including, without limitation, claims for wrongful discharge, constructive discharge, emotional distress, defamation, invasion of privacy, fraud, breach of contract, breach of the covenant of good faith and fair dealing, discrimination, harassment, retaliation, or failure to accommodate ("General Release"). This General Release includes, but is not limited to, claims arising under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act (ADEA),the Americans with Disabilities Act (ADA), the Equal Pay Act (EPA), the Fair Labor Standards Act (FLSA), the Family and Medical Leave Act (FMLA), and any and all applicable state and local laws that maybe applicable, all as amended, and all other federal, state, and local laws and regulations relating to employment or termination of employment that may be legally waived or released; however, the identification of specific statutes is for purposes of example only, and the omission of any specific statute or law shall not limit the scope of this General Release in any manner.
In consideration for the General Release that you are providing the Company and the other Released Parties, the Company and the Released Parties waive, release, and promise never to assert any claims or causes of action, known or unknown, against you. This is a General Release from the Released Parties to you.
Notwithstanding the above, this General Release does not waive or release: (i) any claims arising after you sign this Agreement, including any claim for breach of this Agreement; or (ii) any claims that cannot be legally waived or released as a matter of law, such as filing a claim for unemployment insurance benefits. This General Release also does not prevent you from filing a charge or complaint with, communicating with, or participating in an investigation or proceeding conducted by the Equal Employment Opportunity Commission (EEOC), the Securities and Exchange Commission (SEC), the National Labor Relations Board (NLRB), or any other federal, state, or local governmental agency or commission ("Government Agencies"). However, to the fullest extent permitted by law, you agree that you are waiving the right to monetary damages or other equitable or monetary relief as a result of any charge, complaint, investigation, or proceeding.
8. Company Property. By signing this Agreement, you represent that you have returned to the Company or will return to the Company as soon as practicable, all property belonging to the Company, including, without limitation, company-issued equipment and electronics, copies of documents that belong to the Company, and files and data stored on your computer(s) or in cloud storage accounts containing information belonging to the Company.
9. No Admission. Nothing contained in this Agreement will constitute or be treated as an admission by you or the Company of liability, any wrongdoing, or any violation of law. In response to a request for a reference, and consistent with the Company's policy, the Company will provide the Employee's job title and dates of employment and that the separation was mutually consensual.
10. Confidentiality of Agreement. You agree that you will not disclose to others the existence or terms of this Agreement, except that you may disclose such information to Government Agencies or to your spouse, domestic partner, attorney, or tax adviser if such individuals agree that they will not disclose to others the existence or terms of this Agreement, to the extent allowed under the law.
11. Continuing Obligations. In exchange for the mutual general release in Section 6, the Company is waiving and releasing you of any and all obligations under any non-compete and non-solicit provisions in the Employment Agreements, but not withstanding this release you will remain subject to a covenant not to solicit employees as set forth in Section 5(j) of the former Employment Agreements.
12. Miscellaneous Provisions. If any term of this Agreement is held to be invalid, void, or unenforceable, the remainder of this Agreement will remain in full force and effect and will not be affected. This Agreement will be construed and interpreted in accordance with the laws of the State of Florida, other than its conflict or choice of law provisions that would require the application of any other state's law. This Agreement may be signed and transmitted electronically. A signed pdf version shall have the same force and effect as an original signed document. The parties voluntarily waive any right to a trial by jury on any action arising under or relating to this Agreement.
You may indicate your understanding and acceptance of the Agreement by signing below. If this Agreement is not executed by close of business by Wednesday, August 17, 2022, this offer will expire under its terms.
| Very truly yours, | |||
| Cuentas, Inc. | |||
| By: | /s/ Michael De Prado | ||
| Michael De Prado | |||
| Executive Vice Chairman of Cuentas, Inc. | |||
| Dated: Aug 19, 2022 | |||
I ACKNOWLEDGE AND AGREE THAT I HAVE FULLY READ, UNDERSTAND, AND VOLUNTARILY ENTER INTO THIS AGREEMENT. I ALSO ACKNOWLEDGE THAT MY SIGNATURE BELOW IS AN AGREEMENT TO RELEASE THE COMPANY FROM ANY AND ALL CLAIMS THAT CAN BE RELEASED AS A MATTER OF LAW IN EXCHANGE FOR THE BENEFITS BEING PROVIDED TO ME BY THIS AGREEMENT.
| Employee Signature: | /s/ Jeff Johnson | ||
| Printed Name: | Jeff Johnson | ||
| Dated: | Aug 18, 2022 | ||
Exhibit 99.1
Cuentas Announces Co-Founders Arik Maimon & Michael De Prado to Serve as Company’s Interim CEO and Interim President Respectively at No Additional Cost to the Company.
The Company Board of Directors Approved Establishment of a Search Committee For a Permanent Qualified Veteran CEO With Proven Track Record.
MIAMI BEACH, FL / August 23, 2022 - Cuentas, Inc. (Nasdaq: CUEN & CUENW) ("Cuentas"),a leading fintech provider of mobile financial app and payment solutions, announced today that its co-founder and Executive Chairman, Mr. Arik Maimon and Mr Michael De Prado, co-founder and Executive Vice-Chairman have stepped back into the positions of Interim CEO and Interim President, respectively. as the Cuentas Board of Directors approved.
The decision comes as Cuentas looks to achieve the same record heights as in July 2021, when Maimon and De Prado led it to a market capitalization of $123 million. Misleading since it was not sustained and was a one time blimp.
“After long and careful consideration, I have decided to step in as interim CEO of Cuentas,” says Maimon. “Given that Cuentas reached its highest market cap under my leadership, I decided that this was the best pathway for the company. Moving forward, I will personally take responsibility for every triumph and shortcoming.” He added, “However, I want to stress that Cuentas has never been in a better position than it is today under secure contract what does this mean? since its inception.”
“As the co-founder of Cuentas during the last decade, I am pleased to report to our shareholders that we are now in a position to execute our business plan,” stated Michael De Prado, co-founder and Interim President. “I am very happy that our recent and existing contracts and relations will serve to disrupt the marketplace what is this all about what contracts do you mean??? and I believe that Cuentas is way undervalued in the marketplace and the Company is targeting to become a market leader in the mobile payment segment in the US market,” added De Prado.
Cuentas and Jeff Johnson have arrived at an amicable agreement where Johnson’s departure was effective August 19, 2022. With Johnson’s departure, Arik Maimon will assume the role of Interim CEO.
Forward-Looking Statements
This news release contains "forward-looking statements", as that term is defined in section 27a of the United States Securities Act of 1933, as amended, and section 21e of the United States Securities Exchange Act of 1934, as amended. Statements in this press release, which are not purely historical, are forward-looking statements and include any statements regarding beliefs, plans, expectations, or intentions regarding the future. Except for the historical information presented herein, matters discussed in this news release contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements including these are old forward-looking statements that you do not discuss in this press release nor does it have anything to do with the press release so update what is forward-looking statement s (that we will meet the standard for listing on NASDAQ or successful in our launch of the Cuentas GPR card and mobile app). Statements that are not historical facts, including statements that are preceded by, followed by, or that include such words as "believe", "plan" or "expect" or similar statements are forward-looking statements.
About Cuentas
Cuentas, Inc. (Nasdaq: CUEN & CUENW) is a fintech e-finance and e-commerce service provider with proprietary technology that delivers digital financial services to the underbanked and unbanked Hispanic, Latino and immigrant populations including mobile and financial services, prepaid debit card, ACH and mobile deposits, cash remittance, peer to peer money transferring, and other services. The Cuentas General Purpose Reloadable (GPR) Card includes a digital wallet, discounts for purchases at major physical and online retailers, rewards, and the ability to purchase digital content. For more information, visit https://cuentas.com.
Media Contact
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SOURCE: Cuentas, Inc.