Item 2.02 Results of Operations and Financial Condition
On May 13, 2021, New Relic, Inc. (the "Company") issued a press release
announcing its financial results for the fourth quarter and fiscal year ended
March 31, 2021. A copy of the press release is attached as Exhibit 99.1 to this
Current Report and is incorporated herein by reference.
The information in this Item 2.02, including the press release attached as
Exhibit 99.1 hereto, is furnished pursuant to Item 2.02 but shall not be deemed
"filed" for any purpose, including for the purposes of Section 18 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise
subject to the liabilities of that Section, nor shall it be deemed to be
incorporated by reference into any filing under the Securities Act of 1933, as
amended, or the Exchange Act, whether made before or after the date hereof,
regardless of any general incorporation language in such filing.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Appointment of Executive Chairman, Chief Executive Officer and Director, and
Chief Operating Officer
On May 8, 2021, Lew Cirne, Chief Executive Officer of New Relic, and the
Company's Board of Directors (the "Board") determined that Mr. Cirne would
transition from his role as Chief Executive Officer to Executive Chairman of the
Board, effective July 1, 2021. In connection with Mr. Cirne's appointment as
Executive Chairman, the Board appointed Hope Cochran, who has served as Chair of
the Board since August 2020, to serve as Vice Chair of the Board and Lead
Independent Director, effective July 1, 2021. The Compensation Committee of the
Board (the "Compensation Committee") met on May 8, 2021 and, effective with his
transition, adjusted Mr. Cirne's annual base salary to $350,000 and adjusted his
opportunity to receive a target annual cash bonus to 0%. In addition, effective
May 17, 2021, the Compensation Committee awarded Mr. Cirne an equity grant with
an aggregate value of $5.0 million, split evenly between restricted stock units
("RSUs") and performance stock units ("PSUs"), vesting over a four-year
time-based period and a three-year performance period, respectively.
Also on May 8, 2021, the Board promoted William Staples, the Company's current
President and Chief Product Officer, to Chief Executive Officer, effective July
1, 2021. In connection with Mr. Staples' appointment as Chief Executive Officer,
the Board increased the size of the board to ten directors and appointed Mr.
Staples as a Class II director, whose term expires at the annual meeting of
stockholders to be held in 2022, effective July 1, 2021.
William Staples, age 48, has served as Chief Product Officer of the Company
since February 2020 and as President and Chief Product Officer of the Company
since January 2021. From September 2017 to January 2020, Mr. Staples served as
the Vice President of Experience Cloud Engineering at Adobe Inc., where he led
the global engineering team behind Adobe Inc.'s market-leading Experience Cloud.
From 1999 to March 2016, Mr. Staples served in various product, design and
engineering roles at Microsoft, Inc., most recently as Vice President of Azure
Application Platform. He holds a B.S. from the University of Utah.
The Compensation Committee increased Mr. Staples' annual base salary to $500,000
and increased his target annual cash bonus opportunity percentage to 100%,
effective with his promotion. In addition, effective May 17, 2021, the
Compensation Committee awarded Mr. Staples an equity grant with an aggregate
value of $11.0 million, split evenly between RSUs and PSUs, vesting over a
four-year time-based period and a three-year performance period, respectively.
Mr. Staples, who is currently eligible for Tier 2 benefits under his Change in
Control and Severance Agreement, is also expected to enter into a new Change in
Control and Severance Agreement reflecting Tier 1 benefits, the terms of which
are described in the Company's Definitive Proxy Statement on Schedule 14A filed
with the Securities and Exchange Commission on July 7, 2020. Mr. Staples will
not receive any additional compensation for his service on the Board.
On May 8, 2021, the Board also promoted Kristy Friedrichs, the Company's current
Chief People Officer, to Chief Operating Officer, effective July 1, 2021. The
Compensation Committee increased Ms. Friedrichs' annual base salary to $425,000
and increased her target annual cash bonus opportunity percentage to 75%,
effective with her promotion. In addition, effective May 17, 2021, the
Compensation Committee awarded Ms. Friedrichs an equity grant with an aggregate
value of $3.35 million, split evenly between RSUs and PSUs, vesting over a
four-year time-based period and a three-year performance period, respectively.
Ms. Friedrichs will also be eligible to enter into the Company's standard
Indemnification Agreement for executive officers.
Kristy Friedrichs, age 41, has served as Chief People Officer of the Company
since February 2017. From 2001 to January 2017, Ms. Friedrichs served in various
roles at Bain & Company, a management consulting firm, both in advisory roles
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as an Associate Partner and most recently as the Head of Consulting Operations,
where she led staffing and operations for the Bay Area business. She holds an
M.B.A. from Harvard Business School and a B.S. in Economics from Duke
University.
Other than as described above, the Company has not entered into or materially
amended any material plan, contract or arrangement with Messrs. Cirne and
Staples or Ms. Friedrichs.
There are no family relationships between Messrs. Cirne and Staples or Ms.
Friedrichs and any director or executive officer of the Company, there is no
arrangement or understanding between Messrs. Cirne and Staples or Ms. Friedrichs
and any other person pursuant to which either was selected to serve as an
officer of the Company, and there are no relationships or related transactions
between Messrs. Cirne and Staples or Ms. Friedrichs and the Company that would
be required to be reported under Item 404(a) of Regulation S-K.
Compensation Arrangements
On May 8, 2021, the Compensation Committee approved the Company's fiscal 2022
cash bonus plan, pursuant to which eligible executive officers, including the
Company's named executive officers and Ms. Friedrichs, have the opportunity to
earn quarterly cash bonuses based on corporate performance objectives. Bonus
payments that could be earned under the fiscal 2021 cash bonus plan are capped
at a maximum of 150 % of the quarterly target cash bonus opportunity.
The corporate performance measures for purposes of determining potential
quarterly bonus payments under the fiscal 2022 cash bonus plan will be based on
metrics concerning users, data, and accounts, which will comprise 50%, 30%, and
20%, respectively, of the aggregate payout opportunity for each quarter. In
addition, the Compensation Committee retains the ability, in its sole
discretion, to increase or decrease the amounts actually paid to any executive
officer regardless of the actual performance against these measures.
Accordingly, whether or not a performance bonus is paid for any year, and the
amount of any such bonus, is within the discretion of the Compensation
Committee.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
Exhibit
Number Description
99.1 Press release, dated May 13, 2021, issued by New Relic, Inc.
Cover Page Interactive Data File - the cover page XBRL tags are embedded
104 within the Inline XBRL document.
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