Business Context and Reporting Period
This Form 8-K is a current report filed by Snap Interactive, Inc. (not Intelligent Protection Management Corp.) on April 13, 2017. The filing discloses the award of stock options to Alexander Harrington, the Chief Executive Officer, by the company's compensation committee.
Key Financial Metrics
The filing does not provide specific financial metrics such as revenue, profit, cash flow, margins, debt, or liquidity for the reporting period. The document focuses exclusively on executive compensation arrangements.
Material Changes
The material event reported is the grant of two distinct stock option awards to Alexander Harrington on April 13, 2017:
- Harrington Standard Award: An option to purchase 80,000 shares at an exercise price of $3.63 per share. Vesting is time-based: 25% on the six-month anniversary of the grant date, with the remaining balance vesting in three equal tranches on the first, second, and third anniversaries of the first vesting date.
- Harrington Performance Award: An option to purchase 24,000 shares at an exercise price of $3.63 per share. Vesting is contingent upon the company achieving specific Annual Revenue thresholds within four years of the grant date:
- $40 million revenue: 8,000 shares vest.
- $60 million revenue: 8,000 shares vest.
- $100 million revenue: 8,000 shares vest.
Guidance, Outlook, and Contingencies
Contingency: The validity of these awards under the Snap Interactive, Inc. 2016 Long-Term Incentive Plan is contingent upon stockholder approval of the First Amendment to the Plan at the 2017 Annual Meeting of Stockholders scheduled for May 25, 2017. If the amendment is not approved, the options will be deemed granted outside of the Incentive Plan.
Definitions: The performance award defines "Annual Revenues" to include the company's total revenue plus the annualized revenue of any acquired entities, excluding non-recurring items.
Investor Verification Checklist
- Verify the outcome of the stockholder vote on the First Amendment to the 2016 Long-Term Incentive Plan at the May 25, 2017 Annual Meeting.
- Confirm the vesting schedule and exercise price ($3.63) for the 104,000 total shares awarded to the CEO.
- Review the company's future revenue reports to track progress toward the $40 million, $60 million, and $100 million performance thresholds.
- Examine the attached Exhibit 10.1 (Nonqualified Stock Option Agreement) for full legal terms and conditions.