SGH Reports Inducement Grants Under Nasdaq Listing Rule 5635(c)(4)

Rhea-AI Summary

SMART Global Holdings (NASDAQ: SGH) has announced the grant of inducement awards to its new president of Intelligent Platform Solutions, Pete Manca, who began his role on April 8, 2024. The awards, approved by SGH's independent Compensation Committee, include 106,042 time-based restricted share units (RSUs) and 106,042 performance-based restricted share units (PSUs) at the target level. These grants aim to incentivize Mr. Manca’s employment with the company, as per Nasdaq Rule 5635(c)(4).

The RSUs will vest over four years, with 25% vesting on April 20, 2025, and the rest vesting quarterly. The PSUs will vest based on SGH's total shareholder return (TSR) relative to the median of the Russell 2000 Index after a three-year performance period. The maximum number of shares that can be earned under the PSUs is 200% of the target.

Positive

• Approval of inducement awards to attract talent under Nasdaq Rule 5635(c)(4).
• RSUs will vest over four years, promoting long-term commitment.
• PSUs to be based on relative TSR, aligning management incentives with shareholder performance.
• Potential to earn up to 200% of the target shares under PSUs if performance metrics are met.

Negative

• Significant share dilution potential due to 106,042 RSUs and 106,042 PSUs at target level.
• Dependency on TSR performance relative to the Russell 2000 Index could add uncertainty.
• The full vesting of PSUs is subject to a three-year performance period, delaying potential gains.

MILPITAS, Calif.--(BUSINESS WIRE)-- SMART Global Holdings, Inc. (“SGH”) (Nasdaq: SGH) today announced the grant of inducement awards to its new president of Intelligent Platform Solutions, Pete Manca, in connection with his commencement of employment with SGH on April 8, 2024. The independent Compensation Committee of the Board of Directors of SGH (the “Committee”) approved the grant to Mr. Manca, as of May 23, 2024, of time-based restricted share units with respect to 106,042 ordinary shares of SGH (the “RSUs”) and performance-based restricted share units with respect to 106,042 ordinary shares of SGH at the target level (the “PSUs”).

The awards have been granted to Mr. Manca as inducements material to his entering into employment with SGH in accordance with Rule 5635(c)(4) of the Nasdaq Marketplace Rules. The awards are granted under the SMART Global Holdings, Inc. 2021 Inducement Plan, which was adopted by SGH’s Board of Directors effective as of February 15, 2021, and which authorizes equity awards outside of the shareholder-approved SMART Global Holdings, Inc. Amended and Restated 2017 Share Incentive Plan to provide inducements for certain individuals to enter into employment with SGH and its subsidiaries and affiliates.

The RSUs will vest over four years, with 25% vesting on April 20, 2025, and the remaining 75% vesting in equal quarterly installments thereafter, subject to Mr. Manca’s continued employment through each vesting date.

The PSUs will vest, if at all, based on SGH’s total shareholder return (“TSR”) relative to the performance of the median company in the Russell 2000 Index following the end of a three-year performance period, subject to Mr. Manca’s continued employment through the date of the Committee’s certification that SGH’s TSR equals or exceeds the applicable threshold level of performance. The number of shares that may be earned under the PSUs ranges from 0% of target to 200% of target.

Other terms of the awards are set forth in the 2021 Inducement Plan and the applicable award agreements covering such awards.

About SMART Global Holdings – SGH

At SGH, we design, build, deploy, and manage high-performance, high-availability enterprise solutions that help our customers solve for the future. Across our computing, memory, and LED lines of business, we focus on serving our customers by providing deep technical knowledge and expertise, custom design engineering, build-to-order flexibility, and a commitment to best-in-class quality.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240530319419/en/

Investor Contact:

Suzanne Schmidt

Investor Relations

+1-510-360-8596

ir@sghcorp.com

PR Contact: 

Maureen O’Leary

Director, Communications 

+1-602-330-6846 

pr@sghcorp.com

Source: SMART Global Holdings, Inc.

FAQ

What are the inducement awards announced by SGH for Pete Manca?

SGH announced inducement awards of 106,042 time-based restricted share units (RSUs) and 106,042 performance-based restricted share units (PSUs) to Pete Manca.

When did Pete Manca commence his role at SGH?

Pete Manca commenced his role as president of Intelligent Platform Solutions at SGH on April 8, 2024.

What are the vesting conditions for the RSUs granted to Pete Manca?

The RSUs will vest over four years, with 25% vesting on April 20, 2025, and the remaining 75% vesting in equal quarterly installments.

What determines the vesting of the PSUs granted to Pete Manca?

The PSUs will vest based on SGH’s total shareholder return (TSR) relative to the median performance of companies in the Russell 2000 Index over a three-year period.

How many shares can Pete Manca potentially earn under the PSUs?

Pete Manca can earn between 0% and 200% of the target 106,042 shares under the PSUs, depending on performance metrics.