SCHEDULE: Verb Technology CEO Rory Cutaia Boosts Stake to 12.8% Through Vested Equity Awards
Sentiment:
Beneficial Ownership Update
Rory J. Cutaia, CEO of Verb Technology Company, Inc., has significantly increased his beneficial ownership to 12.8% of the company's common stock, primarily through the vesting of restricted stock units and the exercise of stock options.
Summary
- Rory J. Cutaia, the Chairman of the Board, President, Chief Executive Officer, Secretary, Treasurer, and Director of Verb Technology Company, Inc., beneficially owns 202,210 shares of the company's common stock.
- This ownership represents 12.8% of the outstanding common stock, calculated based on 1,577,955 shares outstanding as of July 11, 2025, plus 1,303 shares issuable from options exercisable within 60 days.
- The beneficial ownership includes 80,000, 60,000, and another 60,000 fully vested restricted stock units (RSUs), 907 shares of common stock, and 1,303 shares underlying stock options exercisable within 60 days.
- The shares were acquired through various means including restricted stock awards for compensation and performance, stock option exercises (some using personal funds), conversion of $200,000 in notes payable to shares, and conversion of $100,000 in accrued compensation to shares.
- Recent significant acquisitions include 80,000 RSUs vested on July 7, 2025, 60,000 RSUs vested on April 10, 2025, and 60,000 RSUs vested on March 10, 2025, all pursuant to a Corporate Action, Change of Control, and Extraordinary Performance Agreement dated October 31, 2024.
- The agreement also outlines potential future RSU issuances (between 40,000 and 80,000 RSUs per milestone) tied to the achievement of extraordinary performance-based quarterly revenue milestones.
Sentiment
Score: 7
Explanation: The document indicates a strong alignment of the CEO's interests with shareholders through increased equity ownership, including performance-based awards and debt-to-equity conversions, which are generally positive signals for investors.
Positives
- Increased insider ownership by the CEO, aligning management interests with shareholders.
- Conversion of $200,000 in notes payable and $100,000 in accrued compensation into common stock, reducing debt on the Issuer's balance sheet.
- CEO's compensation structure includes performance-based restricted stock units tied to quarterly revenue milestones, incentivizing growth.
- The CEO accepted a 25% reduction in cash compensation for a period of four months in exchange for restricted stock units, demonstrating commitment to cash preservation.
Future Outlook
The company has established a Corporate Action, Change of Control, and Extraordinary Performance Agreement that ties future RSU issuances to the achievement of quarterly revenue milestones through December 31, 2025, indicating a focus on future performance.
Industry Context
This filing reflects a common practice among public companies to align executive compensation with company performance and shareholder interests through equity awards. The conversion of debt and accrued compensation to equity is a strategic move to strengthen the balance sheet, which can be particularly relevant for growth-oriented technology companies.
Corporate Governance
| Change Type | Description | Effective Date | Impact Assessment |
|---|---|---|---|
| Executive Compensation Structure | The company entered into a Corporate Action, Change of Control, and Extraordinary Performance Agreement with the CEO, linking future RSU awards to the achievement of specific quarterly revenue milestones and continuous service. | October 31, 2024 | Enhances alignment between executive compensation and company performance, potentially driving strategic focus on revenue growth. |
Related Party Transactions
- The various grants of restricted stock awards, stock options, and the conversion of notes payable and accrued compensation into common stock for Rory J. Cutaia, the CEO, are related-party transactions as they involve compensation and financial arrangements between the company and its chief executive.
Stakeholder Impact
- Shareholders: Benefit from increased alignment of the CEO's interests with shareholder value through significant equity ownership and performance-based incentives. Debt reduction through conversions can also improve the company's financial health.
- Employees: The COVID-19 Full Employment and Cash Preservation Plan, which involved a reduction in cash compensation for officers and staff, indicates a collective effort to preserve jobs and cash during challenging times.
Next Steps
- Achievement of extraordinary performance-based quarterly revenue milestones on September 30, 2025, and December 31, 2025, which could trigger additional RSU issuances to the CEO.
- Future vesting of restricted stock units granted on November 7, 2024 (50,968 RSUs) and January 7, 2025 (75,873 RSUs), which are scheduled to vest annually in equal parts over four years.
Key Dates
| Date | Description |
|---|---|
| October 4, 2019 | Board granted 1 share of common stock as a Restricted Stock Award to the Reporting Person. |
| November 6, 2019 | Board granted 1 share of common stock as a Restricted Stock Award to the Reporting Person. |
| December 5, 2019 | Board granted 1 share of common stock as a Restricted Stock Award to the Reporting Person. |
| December 23, 2019 | Board granted a restricted stock award of 25 shares for up-listing, public offering, and acquisition of Verb Direct, LLC. Also granted 45 shares as annual compensation. |
| April 16, 2020 | Issuer granted 4 shares of common stock pursuant to the COVID-19 Full Employment and Cash Preservation Plan. |
| July 29, 2020 | Board granted 21 shares of common stock as a bonus component and 59 shares as annual compensation. |
| January 4, 2021 | Board granted 40 shares of common stock as annual compensation. |
| January 10, 2021 | Reporting Person exercised stock options to acquire 41 shares of common stock at $9,040.00 per share. |
| May 19, 2021 | Board approved the conversion of $200,000 of notes payable to 24 shares of common stock. |
| October 29, 2021 | Reporting Person exercised stock options to acquire 3 shares of common stock at $13,200.00 per share. |
| January 10, 2022 | Reporting Person exercised stock options to acquire 42 shares of common stock at $9,040.00 per share. |
| January 20, 2022 | Board granted 51 shares of common stock as annual compensation. |
| May 19, 2022 | Board approved the conversion of $100,000 of accrued compensation to 24 shares of common stock at $4,224.00 per share. |
| November 17, 2022 | Board granted stock options to purchase 30 shares of common stock (fully vested) and 47 restricted stock units for a 25% cash compensation reduction. |
| December 31, 2022 | Commencement of equal monthly vesting installments for 47 restricted stock units. |
| June 21, 2023 | 138 shares of common stock issued for deferment of a portion of cash salary. Compensation committee granted a stock option for 2,546 shares. |
| October 31, 2024 | Corporate Action, Change of Control, and Extraordinary Performance Agreement entered into with Rory J. Cutaia. |
| November 7, 2024 | Compensation committee granted 50,968 restricted stock units. |
| December 31, 2024 | First Measurement Date for extraordinary performance-based quarterly revenue milestones. |
| January 7, 2025 | Compensation committee granted 75,873 restricted stock units as compensation for fiscal year ending December 31, 2025. |
| March 10, 2025 | Reporting Person received 60,000 restricted stock units, which vested on the grant date. |
| March 31, 2025 | Second Measurement Date for extraordinary performance-based quarterly revenue milestones. |
| April 10, 2025 | Reporting Person received 60,000 restricted stock units, which vested on the grant date. |
| June 30, 2025 | Third Measurement Date for extraordinary performance-based quarterly revenue milestones. |
| July 7, 2025 | Reporting Person received 80,000 restricted stock units, which vested on the grant date. This is the date of the event requiring the filing. |
| July 11, 2025 | Date as of which 1,577,955 shares of common stock were issued and outstanding for beneficial ownership calculation. |
| September 30, 2025 | Fourth Measurement Date for extraordinary performance-based quarterly revenue milestones. |
| December 31, 2025 | Fifth Measurement Date for extraordinary performance-based quarterly revenue milestones. |
Recommendation
holdKeywords
Verb Technology Company, Rory J. Cutaia, Schedule 13D, beneficial ownership, restricted stock units, stock options, CEO compensation, insider ownership, corporate governance, equity awards
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