Spruce Power Holding Corp 8-K, filed Apr 20, 2021
Spruce Power Holding Corp (SPRU)
About this 8-K
Spruce Power Holding Corp filed this 8-K on April 20, 2021, reporting on events of April 9, 2021.
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 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): April 9, 2021
XL FLEET CORP.
(Exact name of registrant as specified in its charter)
| Delaware | 001-38971 | 83-4109918 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
| 145 Newton Street Boston, MA |
02135 | |
| (Address of principal executive offices) | (Zip Code) |
(617) 718-0329
(Registrant’s telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) |
Name of each exchange on which registered | ||
| Common Stock, par value $0.0001 per share | XL | New York Stock Exchange |
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. |
(c) Appointment of Chief Financial Officer
On April 20, 2021, XL Fleet Corp. (the “Company”) issued a press release announcing that it had entered into an employment offer letter with Cielo Hernandez (the “Offer Letter”), pursuant to which Ms. Hernandez agreed to serve as the Company’s Chief Financial Officer effective as of April 19, 2021, or such other date mutually agreed to by the Company and Ms. Hernandez. On such date, Ms. Hernandez will assume the duties and responsibilities of Principal Financial Officer and Principal Accounting Officer from Dimitri N. Kazarinoff. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
Previously, Ms. Hernandez, age 45, served as Senior Vice President and Chief Financial Officer of South Jersey Industries, Inc. beginning from January 2019 to November 2020. From November 2013 to December 2018, Ms. Hernandez served as Vice President and Chief Financial Officer of the North America and Canada Region for Maersk Agency U.S.A., Inc. Ms. Hernandez holds a bachelor of accounting from Universidad Santiago de Cali and a master of business administration from the University of Miami. There are no family relationships among Ms. Hernandez and any other executive officers or directors of the Company.
The Offer Letter provides for an initial annual base salary of $400,000 per year, and an annual cash bonus with a target cash bonus of 60% of her base salary. In connection with her commencement of employment, Ms. Hernandez will receive an initial equity grant award comprised of (i) $300,000 in non-qualified stock options, such value calculated using a Black-Scholes valuation on the date of grant (the “Options”), to purchase shares of the Company’s common stock, par value $0.0001 (the “Common Stock”), at an exercise price equal to the closing price of the Common Stock on the New York Stock Exchange (“NYSE”) on April 19, 2021 (the “Grant Date”), (ii) $154,000 for relocation expenses, and (iii) $300,000 in restricted stock units (the “RSUs”), such value calculated based on the closing price of the Common Stock on the NYSE on the Grant Date. Each of the Options and RSUs shall vest as follows: (i) 25% of each of the Options and RSUs will vest on the first anniversary of the Grant Date, and (ii) the remaining 75% of each of the Options and RSUs will vest in substantially equal yearly installments over the next three (3) years following such first anniversary, such that each of the Options and RSUs are 100% vested as of the fourth anniversary of the Grant Date, subject to Ms. Hernandez’s continuous service through each applicable vesting date. In addition, Ms. Hernandez will be eligible to receive an annual target equity grant with a targeted value of $400,000. The annual target equity grant will vest based upon the achievement of objective performance criteria, as determined by the Company’s board of directors or its compensation committee prior to the grant date, during the period from commencement of employment through December 31, 2024, subject to Ms. Hernandez’s continuous service through each applicable vesting date.
In addition, the Offer Letter provides that if Ms. Hernandez’s employment with the Company is terminated due to a change in control and (i) by the Company without cause, or (ii) by Ms. Hernandez for good reason, she will receive the following severance benefits: (a) continuing payments of her then-current annual base salary for nine months, (b) 100% acceleration of unvested equity grants, and (c) nine months of benefits continuation. In the event that Ms. Hernandez’s employment with the Company is terminated not due to a change in control and (i) by the Company without cause, or (ii) by Ms. Hernandez for good reason, she will receive the following severance benefits: (a) continuing payments of her then-current annual base salary for six months, (b) forfeiture of unvested equity grants, and (c) six months of benefits continuation.
The foregoing is only a brief description of the above-specified compensatory arrangements, which does not purport to be a complete description of the rights and obligations of the parties thereunder and is qualified in its entirety by the full text of to the Offer Letter, filed hereto as Exhibit 10.1.
In connection with her appointment as the Company’s Chief Financial Officer, the Company expects that Ms. Hernandez will enter into the Company’s standard indemnification agreement. Ms. Hernandez has entered into the Company’s standard employee covenants agreement, which contains customary restrictive provisions including covenants related to confidentiality and non-disclosure, assignment of inventions and a one-year non-solicitation and non-competition.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit Number | Description | |
| 10.1 | Employment Offer Letter, dated as of April 9, 2021, by and between XL Fleet Corp. and Cielo Hernandez. | |
| 99.1 | Press Release. |
1
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Current Report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.
| XL FLEET CORP. | ||
| Date: April 20, 2021 | By: | /s/ Dimitri N. Kazarinoff |
| Name: | Dimitri N. Kazarinoff | |
| Title: | Chief Executive Officer | |
2
Exhibit 10.1
April 9th, 2021
Cielo Hernandez
9 Gladwynne Terrace
Moorestown, NJ 09057
Dear Cielo,
On behalf of XL Fleet (the “Company”) I am pleased to offer you a position as Chief Financial Officer reporting directly to the Chief Executive Officer. This letter (the “Offer Letter”) describes the terms and conditions of your employment with the Company, subject to the approval of the Company’s Board of Directors of this Offer Letter and such terms and conditions.
Responsibilities:
| ● | Serve as a thoughtful, disciplined, and passionate business partner to the CEO, executive team and Board of Directors. |
| ● | Responsible for the management, direction and oversight of the company’s finance function. |
| ● | Lead company growth strategy, establishing aggressive revenue targets and profitability objectives to take XL Fleet through its next stage of growth as a public company. |
| ● | Identify the economic levers and key metrics of the business, driving financial insight and rigor around those initiatives. |
| ● | Spearhead organic and inorganic growth initiatives, with a focus on M&A activity (from deal evaluation through integration). |
| ● | Lead financial planning processes that facilitate and provide transparency to investment decisions. |
| ● | Manage relationships with Wall Street analysts and investors, while partnering with the CEO to develop and communicate the company’s story through institutional conferences, road shows, earnings releases, conference calls, and other media. |
| ● | Develop a scalable operating discipline for the finance organization consisting of the enhanced budgeting, reporting, KPIs, metrics, and dashboards that provide timely and actionable insight on business performance for leaders and Board of Directors. |
| ● | Work with Corporate Controller to ensure that all regulatory reporting requirements are met and provide adequate structure and discipline around internal controls, external (SEC) reporting, and the closing process. |
| ● | Timely management, forecasting, and reporting of cash and cash flow. |
| ● | Ensure cash optimization and capital efficiency. |
| ● | Selectively recruit, build and lead a highly effective finance and accounting team. |
| ● | Promote a culture of high performance, collaboration and accountability. |
145 Newton St. Boston, MA 02135 P 617.648.8500
Offer Specifics:
| ● | Start Date: April 19th, 2021 or another mutually agreed upon date contingent upon the result of a successful background screening. |
| ● | Salary: You will initially receive a base salary of $400,000 annually, paid in accordance with Company payroll policies. Your base salary will be reviewed on a periodic basis in accordance with Company practice. |
| ● | Sign-On Equity Award: You will be granted an initial equity award comprised of (i) $300,000 (using a Black-Scholes valuation on the date of grant) in options to purchase shares of the Company’s Common Stock with an exercise price equal to the closing price of the Company’s Common Stock on the date of grant (the “Options”) and (ii) $300,000 in restricted stock units valued at the closing price of the Company’s common stock on the date of grant (the “RSUs”). Twenty-five percent (25%) of the Options and RSUs shall vest 12 months your Start Date; of the remaining 75%, an additional 25% of such Options and RSUs shall vest every year on the vesting anniversary date for the next three years. |
| ● | Target Annual Equity Grants. You will be eligible to receive an annual target equity grant in 2022 under our annual equity grant program with a targeted value of $400,000. |
| ● | Bonus: You will be eligible for an annual 60% of base salary target bonus. The actual payout will be based on personal performance and company performance per calendar year and paid out in the first quarter of the following year. You must be an active employee at the time of payment to receive the bonus. |
| ● | Relocation Assistance: The Company will provide you with $154,000 for relocation expenses (three (3) months of your base salary, grossed up for taxes at the applicable Federal and Massachusetts rates), provided that you relocate to Massachusetts within one (1) year of your Start Date, or a mutually agreed upon date thereafter. This benefit will be repayable to the Company should you voluntarily terminate your employment within one (1) year of your permanent relocation to Massachusetts. Such repayment must be made within ten (10) days of your termination date. The Company will have the right to set-off any final payments due you at termination against this repayment obligation. Our mutually agreed expectations regarding your relocation are as follows: |
Stage 1: Immediate work with significant time spent in the Boston area (subject to the Company’s COVID protocols), to familiarize yourself with XL’s management and Finance teams and to find temporary housing. XL Fleet will cover the cost of your temporary housing for up to 90 days from the date you are first able to work in the office under our COVID protocols, including travel, hotel, rental car as necessary, and meals via your submission of related receipts via expense reports.
Stage 2: Once your temporary housing has been secured, you will be expected to travel to the Boston area and work in the Company’s offices as required by job responsibilities with frequency to be reasonably determined by you subject to the approval of the CEO. Temporary housing costs will not be reimbursed by the Company. Expenses related to travel to and from Massachusetts once temporary housing is secured will not be reimbursed by the Company.
Stage 3: No later than Summer 2022, you will complete your relocation to the Boston area. A final lump-sum relocation payment, consisting of the aforementioned $154,000 less any relocation expenses already repaid, will be paid within ten (10) days of such date.
145 Newton St. Boston, MA 02135 P 617.648.8500
| ● | Paid Time Off: XL Fleet has adopted an Open PTO (Paid Time Off) policy, by which each employee is afforded the flexibility to take vacation, take time off for illness and shift schedules as necessary. The Open PTO plan is only available to full-time, exempt (salaried) employees. Eligible employees do not “accrue” PTO days as in traditional plans, and so will not be compensated for “unused” PTO time upon termination. All PTO days require approval from supervisors. Employees are still advised to coordinate with their team members to ensure efficiency and minimal disruption. |
| ● | Expenses: The Company shall reimburse you for all reasonable and appropriate travel, entertainment and other expenses incurred or paid by you in connection with, or related to, the performance of your duties, in accordance with policies and procedures, and subject to limitations, adopted by the Company from time to time. |
| ● | Withholding: All payments made by the Company under this Agreement shall be reduced by any tax or other amounts required to be withheld by the Company under applicable law. |
| ● | Health & Welfare Plans: You will be eligible to participate in all Company Health & Welfare plans starting on the first day of your full-time employment, including but not limited to: Medical, Dental, Vision, 401k, Life and Disability Insurances. |
| ● | Conditions of Employment: Your employment is conditioned on your compliance with the Immigration Reform and Control Act of 1986, which requires employers to verify the employment eligibility and identity of new employees by requiring such employees to complete an Employment Eligibility Form 1-9, which will be forwarded upon receipt of your acceptance. Please complete and return it and the appropriate required documents listed on the form. |
| ● | Severance: The Company intends to adopt a severance policy applicable to its management team. As our CFO, you will be entitled to not less than the following: |
| o | Non-CIC Termination without Cause or for Good Reason: |
| § | Salary: 6 months |
| § | Benefits Continuation: 6 months |
| § | Unvested Equity: Forfeited |
| o | CIC + Termination without Cause or for Good Reason: |
| § | Salary: 9 months |
| § | Benefits Continuation: 9 months |
| § | Unvested Equity: Accelerated |
| ● | Time: While employed, you will be required to devote your full business time and your best professional efforts to the performance of your duties and responsibilities for the Company, and to abide by all Company policies and procedures in effect from time to time. All employees may be subject to promotion, transfer or reassignment from time to time, as the Company determines appropriate. |
| ● | Outside Board Service: With the approval of our Board, you are welcome to serve on the board of directors of a company and entity that does not compete with the Company (whether public, private or non-profit), so long as that service does not materially interfere with your service to the Company. |
| ● | Confidential Information and Restricted Activities: As a condition of your employment, you will be required to sign the Company’s standard Employee Covenants Agreement (“Attachment A”), no later than the first day of your employment. |
145 Newton St. Boston, MA 02135 P 617.648.8500
| ● | Representations: You represent and warrant to the Company that your employment with the Company and fulfillment of the duties of your position will not breach or be in conflict with any other agreement you have with any former employer or other person or entity. You also represent and warrant that you are not subject to any covenant against competition or similar covenants, or any other legal obligation, that would restrict or otherwise affect the performance of your duties and responsibilities to the Company. You agree that you will not bring with you, disclose or use on behalf of the Company any confidential or proprietary information of any former employer or other third party without that party’s consent. |
| ● | At-Will Status of Employment: This Offer Letter and your response are not meant to, and do not, constitute a contract of employment for a specific term. Your employment with the Company is at-will. This means that, if you accept this offer, both you and the Company will retain the right to terminate your employment at any time, with or without notice or cause. |
| ● | General: This Offer Letter and its attachments constitute the entire offer for employment and the entire understanding between the parties regarding this offer for employment, and supersedes all prior agreements and understandings, whether written or oral, relating to the subject matter of this Offer Letter. No modification to this Offer Letter will be effective unless in writing and signed by you and an authorized representative of the Company. You may not assign your rights and obligations hereunder without the prior written consent of the Company; the Company may assign its rights and obligations hereunder to any person or entity that succeeds to all or substantially all of the Company’s business. The terms of this Offer Letter and the resolution of any disputes as to the meaning, effect, performance or validity of this Offer Letter or arising out of, related to, or in any way connected with, your employment with the Company or any other relationship between you and the Company will be governed by Massachusetts law, excluding laws relating to conflicts or choice of law. You and the Company submit to the exclusive personal jurisdiction of the federal and state courts located in the Commonwealth of Massachusetts in connection with any such dispute or claim. |
| ● | Background Check: This offer is contingent upon successful completion of a background check. We reserve the right to rescind any offer of employment with you should the results of your background investigation not be successful. |
By your acceptance of this Offer Letter, you agree to abide by the rules, regulations, instructions, personnel practices and policies of the Company, if any, and any changes therein that may be adopted from time to time by the Company.
Cielo, our team is confident you possess the skills and the experience to be successful helping XL Fleet drive profitable growth, and we look forward to you joining the team!
Please confirm your acceptance of this offer by signing below and returning this letter to me no later than close of business on April 11, 2021.
| Yours truly, | |
| /s/ Dimitri Kazarinoff | |
| Dimitri Kazarinoff | |
| Chief Executive Officer |
I have read and understand the terms of the offer set out above. As indicated by my signature below, I hereby accept this offer of employment and agree to the terms and conditions described in this offer letter. By signing below, I agree that no further promises or commitments were made to me regarding my employment with the Company, except as set forth in this letter and any attachments hereto.
Accepted:
| /s/ Cielo Hernandez | April 9, 2021 | |
| Name: Cielo Hernandez | Date |
145 Newton St. Boston, MA 02135 P 617.648.8500
Exhibit 99.1
XL Fleet Bolsters Executive Team with Appointment of Cielo M. Hernandez as Chief Financial Officer
April 20, 2021
Accomplished finance executive with more than 25 years of public and private company experience joins fleet electrification leader
BOSTON--(BUSINESS WIRE)-- XL Fleet Corp. (NYSE: XL) (“XL Fleet” or the “Company”), a leading provider of fleet electrification solutions for commercial vehicles in North America, today announced the addition of Cielo M. Hernandez as Chief Financial Officer of XL Fleet. As CFO, Hernandez will oversee the Company’s financial organization, including financial reporting, financial planning, internal controls, as well as treasury. Hernandez’s extensive experience and capability will also contribute to strategic planning, M&A, and investor relations.
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20210420005456/en/
“We are extremely excited to welcome Cielo to our leadership team,” said Dimitri Kazarinoff, Chief Executive Officer of XL Fleet. “Cielo is a high-caliber finance executive whose extensive experience driving growth, operational improvements and functional excellence positions her very well to lead XL Fleet’s finance organization and deliver significant value to our stakeholders. I look forward to working closely with Cielo as we continue to execute on our growth plan as a public company.”
Hernandez is a finance professional with more than 25 years of experience, with an extensive track record of leading global teams and strategies for both publicly traded and private companies. She has held various positions in finance, operations, procurement and information systems, and prior to joining XL Fleet, served as Senior Vice President and Chief Financial Officer of South Jersey Industries, Inc., a publicly traded energy utility company. She previously served as Vice President and Chief Financial Officer for the North America region at A.P. Moeller Maersk A/S, and held leadership roles at APM Terminals, Amcor and DIRECTV.
“Cielo’s strong finance and accounting background at both public and private companies is well-aligned with XL Fleet’s growth trajectory, and her strategic financial leadership is immensely valuable at a critical time in our company’s evolution,” said Tod Hynes, Founder and President of XL Fleet. “We look forward to Cielo’s contributions toward our ongoing growth and our mission of leading electrification across the global commercial fleet space.”
Hernandez earned her undergraduate degree in Accounting from Universidad Santiago de Cali, Colombia. She also holds a Master of Business Administration degree with specialization in International Business from the University of Miami. Hernandez is a Certified Public Accountant and holds a Certification in Human Resources Talent Management from Universidad Santiago de Cali, Colombia as well as Certifications in Executive Leadership and High-Performance Leadership from Cornell University, and Strategic Leadership and Improving the Business from IMD University Switzerland. Hernandez is a Board member of Rowan University Foundation and was named as one of South Jersey Biz’s Women to Watch for 2020.
About XL Fleet
XL Fleet is a leading provider of fleet electrification solutions for commercial vehicles in North America, with more than 150 million miles driven by customers such as The Coca-Cola Company, Verizon, Yale University and the City of Boston. XL Fleet’s hybrid and plug-in hybrid electric drive systems can increase fuel economy up to 25-50 percent and reduce carbon dioxide emissions up to 20-33 percent, decreasing operating costs and meeting sustainability goals while enhancing fleet operations. XL Fleet’s plug-in hybrid electric drive system was named one of TIME magazine's best inventions of 2019. For additional information, please visit www.xlfleet.com.
Forward Looking Statements
Certain statements in this press release may constitute “forward-looking statements” within the meaning of the federal securities laws. Forward-looking statements generally are accompanied by words such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “should,” “would,” “plan,” “predict,” “potential,” “seem,” “seek,” “future,” “outlook,” and similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectations of management and are not predictions of actual performance. Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from the forward-looking statements, including but not limited to failure to realize the anticipated benefits from the business combination; the effects of pending and future legislation; the highly competitive nature of the Company’s business and the commercial vehicle electrification market; litigation, complaints, product liability claims and/or adverse publicity; cost increases or shortages in the components or chassis necessary to support the Company’s products and services; the introduction of new technologies; the impact of the COVID-19 pandemic on the Company’s business, results of operations, financial condition, regulatory compliance and customer experience; the potential loss of certain significant customers; privacy and data protection laws, privacy or data breaches, or the loss of data; general economic, financial, legal, political and business conditions and changes in domestic and foreign markets; the inability to convert its sales opportunity pipeline into binding orders; risks related to the rollout of the Company’s business and the timing of expected business milestones; the effects of competition on the Company’s future business; the availability of capital; and the other risks discussed under the heading “Risk Factors” in our Annual Report on Form 10-K filed on March 31, 2021 and other documents that the Company files with the SEC in the future. If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. These forward-looking statements speak only as of the date hereof and the Company specifically disclaims any obligation to update these forward-looking statements.
View source version on businesswire.com: https://www.businesswire.com/news/home/20210420005456/en/
Investor Contact:
xlfleetIR@icrinc.com
Media Contact:
PR@xlfleet.com
Source: XL Fleet Corp.