Charles Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Departure of Directors or Certain Officers; Election
of Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
Appointment of CFO and COO
On May 23, 2017, the Board of Directors (the Board) of Charles
Colvard, Ltd. (the Company) appointed Clint J. Pete, the Companys
current Interim Chief Financial Officer and Corporate Controller,
as Chief Financial Officer and Treasurer of the Company and Don
OConnell, the Companys current Senior Vice President, Supply
Chain Distribution, as Chief Operating Officer and Senior Vice
President, Supply Chain.
Mr. Pete, age 55, was appointed as the Companys Interim Chief
Financial Officer effective as of December 2, 2016 and has served
as Corporate Controller of the Company since June 2016. Prior to
joining the Company, Mr. Pete mostly recently served as Director
of Business Planning for Oracle Corporation, a cloud application
company, from June 2013 to May 2016. Prior to his employment with
Oracle Corporation, Mr. Pete served as Business Unit Controller,
Global Signaling Solutions of Tekelec, a telecommunications
company, from May 2011 to May 2013. At Tekelec, Mr. Pete also
previously served as Global Revenue Controller. Prior to his
employment with Tekelec, Mr. Pete served as Vice President of
Finance and Controllers at Qualex Inc., a Kodak company. Before
joining Qualex Inc., Mr. Pete held various management positions
at Ernst Young, LLP, an international public accounting firm. Mr.
Pete holds a Bachelor of Business Administration degree in
Accounting and Finance from Texas Tech University and is a
Certified Public Accountant.
Mr. OConnell, age 51, has served as the Companys Senior Vice
President, Supply Chain Distribution since March 2016. Prior to
joining the Company, Mr. OConnell served as Executive Vice
President Operations Global Jewelry Business Solutions at OFT
Investment Management Group, a fine jewelry solutions and
services group from February 2012 to March 2016. Prior to his
employment with OFT Investment Management Group, Mr. OConnell
spent seven years with the Richline Group, LLC, a wholly owned
subsidiary of Berkshire Hathaway, as Vice President, Operations
Procurement, both Foreign Domestic. Prior to that, he was Vice
President, Operations at Aurafins gem group division in Taramac,
FL and La Paz, Bolivia as well as Vice President, Manufacturing
Contracting with OCON Enterprise.
In connection with Mr. Petes appointment as Chief Financial
Officer and Treasurer and Mr. OConnells appointment as Chief
Operating Officer and Senior Vice President, Supply Chain, the
Company entered into an employment agreement with each of Mr.
Pete and Mr. OConnell effective as of May 23, 2017 (the
Employment Agreements). The Employment Agreements have a term of
one year and renew automatically on an annual basis. Under the
terms of the Employment Agreements, Mr. Pete and Mr. OConnell
will receive initial annual base salaries of $240,000 and
$275,000, respectively. Mr. Pete and Mr. OConnell also will be
entitled to receive such benefits as are made available to the
Companys other similarly-situated executive employees, including,
but not limited to, life, medical, and disability insurance, as
well as retirement benefits.
In addition, each of Mr. Pete and Mr. OConnell will receive, on
the effective date of their respective Employment Agreements, a
stock option to purchase 100,000 shares of the Companys common
stock. The awards will vest over a three-year period, with 25% of
the option awards vesting six months after the grant date and an
additional 25% of the option awards vesting on each of the
following three anniversaries of the grant date provided Mr. Pete
and Mr. OConnell remain continuously employed with the Company
through each anniversary.
to the Employment Agreements, if the Company experiences a change
of control (as defined in the Employment Agreements), and Mr.
Petes or Mr. OConnells employment is terminated within six months
after such change of control by the Company without cause (as
defined in the Employment Agreements) or by the employee for good
reason (as defined in the Employment Agreements), Mr. Pete and/or
Mr. OConnell, as applicable, will continue to receive his
respective base salary at the time of termination for a period of
one year from such termination, so long as he complies with
certain covenants in the Employment Agreements. In addition, each
of Mr. Pete and Mr. OConnell are entitled to receive six months
of his base salary in the event the Company terminates him
without cause not occurring within six months following a change
of control or if the term of the applicable Employment Agreement
expires following the Companys notice of non-renewal, so long as
he complies with certain covenants in the Employment Agreements.
The Company has also agreed to accelerate the vesting of all
outstanding unvested equity awards held by each of Mr. Pete and
Mr. OConnell upon the occurrence of a change of control or
termination without cause not occurring within six months
following a change of control, so long as he complies with
certain covenants in the Employment Agreements. During each of
Mr. Petes and Mr. OConnells employment with the Company and for a
period of one year following termination of their respective
employment, Mr. Pete and Mr. OConnell are prohibited from
competing with the Company or attempting to solicit its customers
A copy of the press release announcing the appointments of Mr.
Pete and Mr. OConnell is attached hereto as Exhibit 99.1 and is
incorporated herein by reference.
Financial Statements and Exhibits.
Description of Document
Employment Agreement, effective as of May 23, 2017, by and
between Charles Colvard, Ltd. and Clint J. Pete
Employment Agreement, effective as of May 23, 2017, by and
between Charles Colvard, Ltd. and Don OConnell
Press Release dated May 23, 2017
About Charles & Colvard, Ltd. (NASDAQ:CTHR)
Charles & Colvard, Ltd. manufactures and distributes Charles & Colvard Created Moissanite jewels (moissanite) and finished jewelry featuring moissanite. The Company’s segments are Wholesale, Moissanite.com and Charles & Colvard Direct. The Company sells loose moissanite jewels and finished jewelry at wholesale to distributors, manufacturers and retailers, and at retail to end consumers through its operating subsidiaries. The Company manages its business primarily through its three distribution channels that it uses to sell its product lines, loose jewels and finished jewelry, which included Charles and Colvard Direct, LLC. The Company sells loose moissanite jewels and finished jewelry featuring moissanite at wholesale to retailers, television (TV) shopping networks, and designers to be sold to end consumers and directly to consumers through its e-commerce sales channel Moissanite.com. The Company primarily sells moissanite jewels, including Forever Classic and Forever Brilliant. Charles & Colvard, Ltd. (NASDAQ:CTHR) Recent Trading Information
Charles & Colvard, Ltd. (NASDAQ:CTHR) closed its last trading session down -0.020 at 0.880 with 196 shares trading hands.
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