Business Context and Reporting Period
This Form 8-K Current Report was filed by Custom Truck One Source, Inc. (CTOS) on December 7, 2022. The filing discloses significant executive leadership changes and the execution of new employment agreements as part of the company's succession planning.
Key Financial Metrics
This filing does not contain financial performance data such as revenue, profit, cash flow, margins, debt, or liquidity metrics. The document focuses exclusively on executive compensation and personnel changes.
Material Changes
- Executive Transition: Fred Ross, the current Chief Executive Officer (CEO), notified the Board on December 7, 2022, that he will retire as CEO effective March 20, 2023.
- Succession Appointment: Ryan McMonagle, currently President and Chief Operating Officer (COO), was appointed as the incoming CEO, effective March 20, 2023.
- Role Change for Founder: Upon stepping down as CEO, Fred Ross will transition to the role of Founder and will continue to serve as a member of the Board of Directors.
Management Commentary, Risks, and Compensation Details
The filing details the terms of the amended and restated employment agreements for both executives, effective December 7, 2022.
Ryan McMonagle (Incoming CEO)
- Term: Initial five-year term commencing March 20, 2023, with automatic one-year renewals.
- Compensation: Annual base salary of $850,000 and an annual cash bonus target of 50% of base salary.
- Equity: Eligible for equity awards under the 2019 Omnibus Incentive Plan.
- Severance: In the event of termination without "cause" or resignation for "good reason," he is entitled to two times his base salary paid over 24 months, plus accrued bonuses and 24 months of health coverage.
Fred Ross (Outgoing CEO/Founder)
- Term: Initial one-year term as Founder commencing March 20, 2023, with automatic one-year renewals.
- Compensation: Annual base salary of $800,000 and an annual cash bonus target of 50% of base salary.
- Equity: Eligible for equity awards under the 2019 Omnibus Incentive Plan.
- Severance: Similar to Mr. McMonagle, entitled to two times base salary over 24 months, accrued bonuses, and 24 months of health coverage upon qualifying termination.
Investor Verification Checklist
- Verify the exact effective date of the leadership transition (March 20, 2023) and any interim arrangements.
- Review the full text of the employment agreements (Exhibits 10.1 and 10.2) for specific definitions of "cause" and "good reason."
- Confirm the status of Ryan McMonagle's appointment to the Board of Directors, which is scheduled to occur "as soon as reasonably practicable."
- Assess the impact of the leadership change on the company's strategic direction, as detailed in the accompanying press release (Exhibit 99.1).