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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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): March 3, 2011
DYNATRONICS CORPORATION
(Exact name of registrant as specified in its charter)
Utah 0-12697 87-0398434
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(State or Other Jurisdiction Commission File (IRS Employer
of Incorporation) Number Identification Number)
7030 Park Centre Dr., Salt Lake City, Utah 84121
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (801) 568-7000
Check the appropriate box below if the Form 8-K filing 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 (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
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Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
(e) Contract with Named Executive Officer. On March 3, 2011, with an
effective date of March 1, 2011, Dynatronics Corporation ("Registrant") entered
into an employment contract with Larry Beardall, Executive Vice President of
Business Development, Sales & Marketing ("Beardall"). The agreement was approved
by the Compensation Committee of the Registrant's Board of Directors. The
principal terms and conditions of the contract are as follows:
o The term of the agreement is five years and it is automatically
renewed for successive one-year periods unless terminated by either
party with written notice given 30 to 90 days prior to the
expiration of the current term;
o Beardall is paid a base salary of $160,000 per annum, subject to
adjustment by the Compensation Committee of the Registrant;
o The compensation includes a grant of 200,000 shares of restricted
stock pursuant to a written Restricted Stock Award under the
Registrant's 2005 Equity Incentive Award Plan, such shares vesting
annually over a ten-year period at the rate of 20,000 shares per
year;
o Beardall is entitled to participate in the Registrant's benefits
plans, receives the use of a company-owned automobile, and other
fringe benefits;
o Beardall participates in a bonus plan developed for him, as follows:
o Fiscal Year 2011 and Fiscal Year 2012 Bonuses shall be an
amount equal to:
o One and one-half of one percent (0.015 times) the gross
profit margin of the Registrant in excess of $3,200,000
quarterly; and
o A percentage of quarterly pre-tax profit of the
Registrant as follows:
o four percent (0.04 times) pre-tax profits in
excess of $75,000 up to $150,000; and
o five percent (0.05 times) pre-tax profits in
excess of $150,000 up to $400,000; and
o six percent (0.06 times) pre-tax profits in excess
of $400,000
o In the event of a change of control, under certain conditions,
Beardall will be paid a separation and transition payment as
follows:
o all accrued but unpaid wages through the termination date,
based on Beardall's then current base salary;
o a separation payment equal to twelve (12) months of Beardall's
then current base salary;
o all accrued but unpaid vacation through the termination date,
based on Beardall's then current base salary;
o all approved, but unreimbursed, business expenses, provided
that a request for reimbursement of business expenses is
submitted in accordance with the Registrant's policies and
submitted within five (5) business days of Beardall's
termination date; and
o all earned and accrued but unpaid bonuses.
o In the event of a sale of the Registrant or similar liquidity event,
Beardall is paid a bonus of $400,000;
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o In the event of a change of control (as defined in the agreement),
under certain circumstances, Mr. Beardall may receive additional
benefits as follows:
o All of Beardall's outstanding unvested equity-based awards
(including, but not limited to, the Restricted Stock Award)
granted pursuant to the incentive plans of the Regisrant,
shall vest and become immediately exercisable and
unrestricted, without any action by the Registrant's board or
any committee thereof, and
o He will be paid a one-time lump sum bonus in the amount of
$400,000 in connection with the closing of the change of
control transaction.
The description of the agreement and its terms is qualified in its entirety by
the form of agreement furnished herewith as an exhibit to this Current Report on
Form 8-K.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits.
Exhibit No. Description
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10.1 Executive Employment Agreement
10.2 Restricted Stock Award
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
DYNATRONICS CORPORATION
By: /s/ Kelvyn H. Cullimore, Jr.
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Kelvyn H. Cullimore, Jr.
Chairman and President
Date: March 4, 2011
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