VIVINT SMART HOME, INC. Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
As previously disclosed, on
Transition and Consulting Agreement with
On
Side Letter with
On
Retention Letters with
On
• Mr. Patel's title will be President of Vivint Smart Home (or other title
that is mutually agreed upon by the parties).
• For the 25 month period following Closing, the Company agreed not to
reduce Mr. Patel's (i) base salary, (ii) annual target bonus,
(iii) pre-existing retention awards, or (iv) opportunities to receive
annual long-term incentive awards of $3,000,000 per year (the "Patel
Annual Target Long-Term Incentive Award").
• Parent agreed to cause the Company to pay Mr. Patel a cash retention
bonus equal to $1,500,000 , payable in two equal installments, on each of
the 12 month and 24 month anniversaries of the Closing, subject to
Mr. Patel's continuous employment by the Company and certain accelerated
vesting provisions upon certain terminations as described below.
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• If (i) Mr. Patel's employment is terminated (x) by the Company without
"cause" (as defined in the Patel Employment Agreement), (y) by Mr. Patel
for "good reason," or (z) due to death or disability, in each case, at
any time from the Closing and prior to, or on, the 24-month anniversary
of the Closing, (ii) the Company or its affiliate, as applicable,
delivers a notice of non-renewal of the Patel Employment Agreement, or
(iii) Mr. Patel resigns for any reason during the 30 days following the
24-month anniversary of the Closing, then Mr. Patel will be entitled to
receive (A) the severance payments and benefits described in Section 5(e)
of the Patel Employment Agreement, (B) full acceleration at target level
of performance of the unvested equity awards that are then outstanding
that were granted prior to December 6, 2022 and those unvested equity
awards granted in respect of 2023 and (C) any of the four existing
retention bonus payments described in the Patel Employment Agreement that
have not previously been paid, in each case, payable in accordance with
the terms of the Patel Employment Agreement governing a termination by
the Company without "cause".
• If Mr. Patel's employment with the Company, Parent or an affiliate is
terminated due to death or disability, 100% of Mr. Patel's unvested
equity awards that are outstanding as of the date of such termination
will vest at target level of performance as of such date.
• The definition of "good reason" in the Patel Employment Agreement was
amended to mean (A) a reduction in Mr. Patel's base salary, Patel Annual
Target Long-Term Incentive Award, annual target bonus or existing
retention bonus; (B) a material diminution in Mr. Patel's title as
President of Vivint Smart Home (or other title that is mutually agreed
upon by the parties), or Mr. Patel being given duties and
responsibilities materially ceasing to be reasonably related to those
customarily performed by an officer with that title; (C) Mr. Patel
ceasing to report to the CEO of Parent; (D) the relocation of Mr. Patel's
primary office location to a location that is more than 50 miles from
such primary office location; or (E) the Company's material breach of any
material agreement to which Mr. Patel is party with the Company or its
affiliates.
On
• Mr. Santiago's title will be Chief Revenue Officer of Vivint Smart Home
(or other title that is mutually agreed upon by the parties).
• For the 25 month period following Closing, the Company agreed not to
reduce Mr. Santiago's (i) base salary, (ii) annual target bonus,
(iii) pre-existing retention awards, or (iv) opportunities to receive
annual long-term incentive awards of $3,000,000 per year (the "Santiago
Annual Target Long-Term Incentive Award").
• Parent agreed to cause the Company to pay Mr. Santiago a cash retention
bonus equal to $1,500,000 , payable in two equal installments, on each of
the 12 month and 24 month anniversaries of the Closing, subject to
Mr. Santiago's continuous employment by the Company and certain
accelerated vesting provisions upon certain terminations as described
below.
• If (i) Mr. Santiago's employment is terminated (x) by the Company without
"cause" (as defined in the Santiago Employment Agreement), (y) by
Mr. Santiago for "good reason," or (z) due to death or disability, in
each case, at any time from the Closing and prior to, or on, the 24-month
anniversary of the Closing, (ii) the Company or its affiliate, as
applicable, delivers a notice of non-renewal of the Santiago Employment
Agreement, or (iii) Mr. Santiago resigns for any reason during the 30
days following the 24-month anniversary of the Closing, then Mr. Santiago
will be entitled to receive (A) the severance payments and benefits
described in Section 5(e) of the Santiago Employment Agreement, (B) full
acceleration at target level of performance of the unvested equity awards
that are then outstanding that were granted prior to December 6, 2022 and
those unvested equity awards granted in respect of 2023 and (C) any of
the existing retention bonus payments described in the Santiago
Employment Agreement that have not previously been paid, in each case,
payable in accordance with the terms of the Santiago Employment Agreement
governing a termination by the Company without "cause".
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• If Mr. Santiago's employment with the Company, Parent or an affiliate is
terminated due to death or disability, 100% of Mr. Santiago's unvested
equity awards that are outstanding as of the date of such termination
will vest at target level of performance as of such date.
• The definition of "good reason" in the Santiago Employment Agreement was
amended to mean (A) a reduction in Mr. Santiago's base salary, Santiago
Annual Target Long-Term Incentive Award, annual target bonus or existing
retention bonus; (B) a material diminution in Mr. Santiago's title as
Chief Revenue Officer of Vivint Smart Home (or other title that is
mutually agreed upon by the parties), or Mr. Santiago being given duties
and responsibilities materially ceasing to be reasonably related to those
customarily performed by an officer with that title; (C) the relocation
of Mr. Santiago's primary office location to a location that is more than
50 miles from such primary office location; or (D) the Company's material
breach of any material agreement to which Mr. Santiago is party with the
Company or its affiliates.
On
• Mr. Garen's title will be Chief Ethics and Compliance Officer of Vivint
Smart Home (or other title that is mutually agreed upon by the parties).
• For the 25 month period following Closing, the Company agreed not to
reduce Mr. Garen's (i) base salary, (ii) annual target bonus, or
(iii) opportunities to receive annual long-term incentive awards of
$700,000 per year (the "Garen Annual Target Long-Term Incentive Award").
• Parent agreed to cause the Company to pay Mr. Garen a cash retention
bonus equal to $750,000 , payable in two equal installments, on each of
the 12 month and 24 month anniversaries of the Closing, subject to
Mr. Garen's continuous employment by the Company and certain accelerated
vesting provisions upon certain terminations as described below.
• If (i) Mr. Garen's employment is terminated (x) by the Company without
"cause" (as defined in the Garen Employment Agreement), (y) by Mr. Garen
for "good reason," or (z) due to death or disability, in each case, at
any time from the Closing and prior to, or on. the 24-month anniversary
of the Closing, (ii) the Company or its affiliate, as applicable,
delivers a notice of non-renewal of the Garen Employment Agreement, or
(iii) Mr. Garen resigns for any reason during the 30 days following the
24-month anniversary of the Closing, then Mr. Garen will be entitled to
receive (A) the severance payments and benefits described in Section 5(e)
of the Garen Employment Agreement, and (B) full acceleration at target
level of performance of the unvested equity awards that are then
outstanding that were granted prior to December 6, 2022 and those
unvested equity awards granted in respect of 2023, in each case, payable
in accordance with the terms of the Garen Employment Agreement governing
a termination by the Company without "cause".
• If Mr. Garen's employment with the Company, Parent or an affiliate is
terminated due to death or disability, 100% of Mr. Garen's unvested
equity awards that are outstanding as of the date of such termination
will vest at target level of performance as of such date.
• The definition of "good reason" in the Garen Employment Agreement was
amended to mean (A) a reduction in Mr. Garen's base salary, Garen Annual
Target Long-Term Incentive Award, or annual target bonus; (B) a material
diminution in Mr. Garen's title as Chief Ethics and Compliance Officer of
Vivint Smart Home (or other title that is mutually agreed upon by the
parties), or Mr. Garen being given duties and responsibilities materially
ceasing to be reasonably related to those customarily performed by an
officer with that title; (C) the relocation of Mr. Garen's primary office
location to a location that is more than 50 miles from such primary
office location; or (D) the Company's material breach of any material
agreements to which Mr. Garen is party with the Company or its
affiliates.
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