Item 2.02 Results of Operations and Financial Condition.
On May 9, 2023, Vacasa, Inc. (together with its subsidiaries, the "Company")
issued a shareholder letter announcing its financial results for the fiscal
quarter ended March 31, 2023. The full text of the shareholder letter issued in
connection with the announcement is furnished as Exhibit 99.1 to this Current
Report on Form 8-K.
The information in this Item 2.02 (including Exhibit 99.1) shall not be deemed
"filed" for 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 and shall not be deemed to be incorporated by reference into any filing
of the Company under the Securities Act of 1933, as amended, or the Exchange
Act, except as expressly set forth by specific reference in such a filing.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Chief Financial Officer Transition Plan
On May 3, 2023, the Company and Jamie Cohen, Chief Financial Officer, agreed
that Ms. Cohen will step down from her position as Chief Financial Officer
(principal financial officer and principal accounting officer) on June 1, 2023,
and that Bruce Schuman will join the Company as Chief Financial Officer on June
1, 2023 (the "CFO Commencement Date") and serve as the Company's principal
financial officer. Ms. Cohen, who is stepping down to pursue other
opportunities, will continue to serve as an advisor to the company through
October 1, 2023 in order to facilitate an orderly succession and transition. The
transition is not the result of any disagreements between Ms. Cohen and the
Company.
Mr. Schuman, age 52, previously served as Executive Vice President and Chief
Financial Officer of Kiavi, Inc. from June 2021 to December 2022. Prior to his
time at Kiavi, Mr. Schuman spent over 27 years at Intel Corporation where he
served as Vice President and Chief Financial Officer of Intel Capital from March
2020 to June 2021, Vice President and Chief Financial Officer of the Server CPU
and Memory Group from May 2019 to March 2020 and Vice President and Chief
Financial Officer of the Enterprise and Government Group from January 2017 to
May 2019. Mr. Schuman received a BBA in Finance from New Mexico State
University.
Mr. Schuman Offer Letter, Equity Awards, and Change in Control and Retention
Agreement
On May 3, 2023, the Company's subsidiary, Vacasa, LLC ("Vacasa"), entered into
an employment offer letter with Mr. Schuman (the "Offer Letter") that provides
for the terms and conditions of his employment as Chief Financial Officer of the
Company. The offer letter provides that Mr. Schuman will be paid an annual base
salary of $425,000 and be eligible for an annual performance bonus targeted at
50% of his base salary.
Subject to his commencement of service with Vacasa on the CFO Commencement Date,
Mr. Schuman will be granted an award of 651,250 restricted stock units ("RSUs")
and an award of 651,250 performance stock units ("PSUs") under the Company's
2021 Incentive Award Plan (the "2021 Plan"). Each RSU and PSU represents the
right to receive one share of the Company's Class A common stock upon vesting.
The award of RSUs will vest as to 25% of the total RSUs on the first anniversary
of the CFO Commencement Date, and as to 1/16th of the total RSUs on each
quarterly anniversary thereafter, subject to Mr. Schuman's continued service
with the Company through the applicable vesting date. The award of PSUs will
vest upon the satisfaction of both service-based and performance-based
conditions. The service-based condition will be satisfied as to 25% of the total
RSUs on the first anniversary of the CFO Commencement Date, and as to 1/16th of
the total PSUs on each quarterly anniversary thereafter, subject to Mr.
Schuman's continued service with the Company through the applicable date. The
performance-based condition will be satisfied upon the achievement of certain
stock price targets, which are achieved when the trailing 45 trading day average
closing trading price of a share of the Company's Class A common stock equals or
exceeds a stock price target during the term of the award. The performance-based
condition consists of four tranches with different stock price targets, with
each tranche related to 25% of the PSUs.
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Mr. Schuman must continue his service with the Company on each date a stock
price target is met for the corresponding tranche to satisfy the
performance-based condition. Any PSUs that have not satisfied the
performance-based condition as of the fourth anniversary of the CFO Commencement
Date will be forfeited. In the event of a change in control of the Company, any
then-unmet stock price target may be achieved based on the price per share to be
paid to Company stockholders in connection with the change in control
transaction.
Additionally, while employed, commencing in 2024, Mr. Schuman will be eligible
to participate in the Company's annual refresh equity award program, under which
he would be eligible to receive an award of RSUs and PSUs under the 2021 Plan.
The total number of RSUs and PSUs underlying each refresh award will be
determined by dividing $500,000 (assuming a three-year vesting schedule) by a
value per share that is determined by the Board, in its discretion, using any
methodology that it deems appropriate, and each refresh award will be comprised
at least 50% of PSUs. Each refresh RSU award is currently expected to vest over
a period of three years, with quarterly vesting dates. Each refresh PSU award
will have performance metrics and other terms that are consistent with the
refresh PSU awards granted to the Company's other senior executives for the
applicable year. If a refresh award has a time vesting schedule other than three
years, the target value of the award will be proportionally adjusted.
Mr. Schuman's Offer Letter also provides that he will be eligible for severance
benefits under a Change in Control and Retention Agreement with Vacasa (the
"Schuman CIC Agreement"). If Mr. Schuman's employment with Vacasa is terminated
by Vacasa without "cause" or he resigns for "good reason" (each as defined in
the Schuman CIC Agreement), then, subject to his delivery of a general release
of claims in favor of Vacasa, Mr. Schuman will be eligible to receive the
following: (i) a lump sum payment equal to 12 months' base salary; (ii)
reimbursement for the cost of up to 12 months of healthcare continuation
coverage; and (iii) if such termination occurs within the period beginning three
months before and ending 12 months after a change in control of Vacasa, 100%
vesting acceleration for all equity awards that vest solely based on continued
service over time (including for this purpose the portion of any equity award
with performance-based vesting conditions for which the performance condition
has already been met such that such portion of the award vests solely based on
continued service over time).
In connection with his appointment, Mr. Schuman will also enter into the
Company's standard form of indemnification agreement for directors and officers
and an at-will employment, confidential information, non-competition,
non-solicitation and invention assignment agreement.
Ms. Cohen Transition Agreement
Vacasa entered into a Transition Agreement with Ms. Cohen on May 3, 2023 (the
"Transition Agreement") pursuant to which Ms. Cohen will step down from her
position with Vacasa effective June 1, 2023, unless her employment terminates
earlier as set forth in the Transition Agreement (the applicable date of her
termination from employment, the "Separation Date").
Pursuant to the Transition Agreement, if Ms. Cohen's Separation Date occurs on
June 1, 2023, then in exchange for Ms. Cohen executing a general release of
claims in favor of Vacasa and in order to ensure an orderly transition of her
responsibilities, Ms. Cohen will provide transition consulting services on an
as-requested and as-needed basis during the period commencing on June 2, 2023
and ending on October 1, 2023 or such earlier date as set forth in the
Transition Agreement (the "Consulting Period"). During the Consulting Period,
Vacasa will provide Ms. Cohen with the following: (i) a monthly retainer of
$41,666, which shall be prorated for any partial month of consulting services
during the Consulting Period; (ii) continued vesting of Ms. Cohen's outstanding
equity awards in accordance with their terms during the Consulting Period; and
(iii) reimbursement for the cost of a portion of healthcare continuation
coverage during the Consulting Period, with such portion limited to the amount
the Company would have otherwise contributed toward Ms. Cohen's group health
insurance as an active employee.
In addition, the Transition Agreement provides that the Change in Control and
Retention Agreement effective March 1, 2021, between Vacasa and Ms. Cohen (the
"Cohen CIC Agreement") will remain in effect until the Separation Date, provided
that (i) Ms. Cohen's resignation from employment at any time, and (ii) Ms.
Cohen's separation from employment on June 1, 2023 in accordance with the
Transition Agreement shall not, in either case, constitute a "Qualifying
Termination", as defined in the Cohen CIC Agreement. The CIC Agreement will
terminate immediately following the Separation Date.
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The foregoing descriptions of the Offer Letter and the Transition Agreement are
qualified in their entirety by reference to the full text of such agreements,
copies of which are filed as Exhibits 10.1 and 10.2, respectively, hereto, and
the foregoing description of the Schuman CIC Agreement is qualified in its
entirety by reference to the full text of such agreement, a copy of which will
be filed as an exhibit to the Company's next quarterly report on Form 10-Q.
Principal Accounting Officer
Tad Larsen will assume the role of principal accounting officer on June 1, 2023.
Mr. Larsen, age 60, has served as the Company's Principal Accounting Officer
since July 2020. Previously, he served as Vice President of Accounting at Redfin
. . .
Item 7.01 Regulation FD.
On May 9, 2023, the Company issued a press release announcing the Chief
Financial Officer transition referred to in Item 5.02 of this Current Report on
Form 8-K. A copy of the press release is furnished as Exhibit 99.2.
The information in this Item 7.01 and in Exhibit 99.2 is being furnished and
shall not be deemed "filed" for purposes of Section 18 of the Exchange Act, or
otherwise subject to the liabilities of that Section and shall not be deemed to
be incorporated by reference into any filing of the Company under the Securities
Act of 1933, as amended, or the Exchange Act.
Item 9.01 Financial Statements and Exhibits.
(d): Exhibits:
Exhibit No. Description
Offer Letter, dated May 3, 2023, between Vacasa, LLC and Bruce
10.1 Schuman
Transition Agreement, dated May 3, 2023, between Vacasa LLC and Jamie
10.2 Cohen
99.1 Shareholder Letter issued by Vacasa, Inc., dated May 9, 2023
99.2 Press Release, dated May 9, 2023
Cover Page Interactive Data File (formatted as inline XBRL and contained
104 in Exhibit 101)
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