Item 5. 02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers

On May 9, 2022 Axon Enterprise, Inc. (the “Company”) entered into a new executive employment agreement (the “Agreement”) with James C. Zito, Interim Chief Financial Officer (the “Executive”).

Following is a summary of the key provisions of the Agreement.

Term of Employment: The Agreement has an effective date of May 9, 2022 and continues for a period of one year. The Agreement will automatically renew and continue for successive one year terms unless terminated pursuant to

qualifying termination events, and will automatically terminate, without notice, when the Executive reaches 70 years of age.

Base Salary, Bonus Opportunity and Equity Incentives: During the term of the Agreement, the Executive shall receive a base salary and be eligible to participate in any cash bonus programs and receive equity compensation awards (time and/or performance based) as determined in the sole discretion of the Compensation Committee of the Board of Directors (the “Committee”).

Termination and Severance: The Company or the Executive may terminate the Agreement and the Executive’s employment in various circumstances and, depending on the circumstances, the benefits that may be due following such termination are described below.

For a termination by the Company with cause, no severance benefits are payable.

Severance benefits and acceleration of equity awards relating to a Change in Control are subject to a qualifying termination (i.e., double trigger). Generally, qualifying terminations include a resignation by the Executive for Good Reason following a Change in Control, or by the Company without cause six months prior to a Change in Control, except with respect to XSUs (as defined and discussed below).

The table below depicts the cash severance payments that would be payable under the circumstances indicated.


	Termination
By the Company Without Cause	By Executive Following a Change in Control For Good Reason or by the Company Without Cause Six Months Prior to Change in Control	Death or Disability
6 months salary; target bonus for calendar year of effective date of termination	36 months salary; prorata portion of annual target bonus for the year in which termination occurs; 12 months COBRA	18 months salary; prorata portion of annual target bonus for the year in which termination occurs

RSUs and performance share awards (“PSUs”) may vest as follows:

	●	Termination with cause: no accelerated vesting

	●	Termination without cause: only time-based RSUs vesting during the notice and severance period will vest

	●	Termination following death or disability, termination by the Executive following a Change in Control for good reason or by the Company six months prior to a Change in Control without cause, all RSUs will vest and all PSUs will vest at target levels

XSUs may vest as follows:


Termination
without Cause	Change in Control*	Death or Disability
XSU operational goals are disregarded and market capitalization is calculated as of the last date of employment; next unattained tranche will partially vest on a prorated basis by comparing the six-month market capitalization to the goal	XSU operational goals are disregarded and an alternative market capitalization calculation is utilized for purposes of determining attainment of unvested tranches, plus one additional tranche	N/A

*****Including by the Executive for good reason following a Change in Control or by the Company without cause 90 days prior to, or one year after, a Change in Control.

Executive Covenants: In consideration of each Executive's continued employment with the Company and the benefits and payments described in his respective Agreement, each Executive agrees to comply with and adhere to the following covenants during their term of his employment with the Company, including during any notice period of termination of employment and during a period of twelve months commencing upon termination of employment with the Company for any reason:

	●	Covenant not to compete;

	●	Covenant not to disparage the Company or its products;

	●	Covenant not to solicit customers;

	●	Covenant not to recruit or hire the Company’s employees;

	●	Assignment of inventions; and

	●	Nondisclosure of Company confidential information

The preceding description of the Agreement is a summary of its material terms, does not purport to be complete, and is qualified in its entirety by reference to the Agreement, a copy of which is being filed as Exhibit 10.1 to this Quarterly Report on Form 10-Q and is incorporated herein by reference.

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