Twitter, Inc.
TWITTER, INC. (Form: 8-K, Received: 07/11/2017 16:06:28)

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)

July 11, 2017

Twitter, Inc.

(Exact name of registrant as specified in its charter)

Delaware

 

001-36164

 

20-8913779

(State or other jurisdiction of incorporation)

 

(Commission File Number)

 

(IRS Employer
Identification No.)

1355 Market Street, Suite 900

San Francisco, California 94103

(Address of principal executive offices, including zip code)

(415) 222-9670

(Registrant’s telephone number, including area code)

 

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

[  ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[  ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[  ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[  ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  [  ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [  ]

 


Item 5.0 2 .

Departure of Directors or Certain Officers; Election of Directors; Appointment o f Certain Officers; Compensatory Arrangements of Certain Officers.

On July 11, 2017, Twitter, Inc. (“Twitter”) announced that its board of directors appointed Ned D. Segal as its Chief Financial Officer (“CFO”), effective late August 2017. Mr. Segal will take over the CFO role from Anthony Noto, Twitter’s Chief Operating Officer and Chief Financial Officer. Mr. Noto will continue to serve as Twitter’s Chief Operating Officer after Mr. Segal’s appointment is effective.

Mr. Segal, 43, has served as Senior Vice President of Finance of Intuit Inc., most recently leading financial and strategic planning for the Small Business Group, since January 2015. From April 2013 until January 2015, Mr. Segal served as Chief Financial Officer of RPX Corporation, a publicly-traded patent risk management solutions company. Mr. Segal previously held various positions at Goldman Sachs & Co. from 1996 to April 2013, most recently as Managing Director, Head of Global Software Investment Banking from 2009-2013. He began his career at Goldman Sachs in equity research sales, specializing in the technology sector, and transitioned to investment banking in 2005. Mr. Segal holds a B.S. from Georgetown University.

There are no arrangements or understandings between Mr. Segal and any other persons pursuant to which he was selected as Chief Financial Officer. There are also no family relationships between Mr. Segal and any Twitter director or executive officer and he has no direct or indirect material interest in any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K.

Twitter entered into a letter agreement with Mr. Segal (the “Offer Letter”) dated July 11, 2017, and will enter into a Change of Control Severance Policy Participation Agreement (the “Participation Agreement”), a copy of which was filed with Securities and Exchange Commission as Exhibit 10.1 to Twitter’s Quarterly Report on Form 10-Q on August 11, 2014.  Each establishes his compensation as CFO as summarized below.

Salary. Mr. Segal’s annual salary rate will be $500,000.

Sign-on Bonus. Mr. Segal will be entitled to receive a sign-on bonus of $300,000. If Mr. Segal’s employment with Twitter is terminated before the one year anniversary of his start date (outside the context of a change of control), he will be required to repay the sign-on bonus, prorated for time spent at Twitter.

Equity Compensation.   In connection with his appointment and subject to approval by the Compensation Committee of Twitter’s board of directors, Twitter has agreed to grant two stock awards in the form of (i) Restricted Stock Units (“RSUs”) for 794,444 shares of Twitter common stock vesting over 4 years and (ii) performance-based restricted stock units (“PRSUs”) for 372,223 shares of Twitter common stock which will be eligible to vest based upon Twitter’s achievement of certain performance targets over next four fiscal years, in each case as more specifically described in the Offer Letter and subject to the terms of Twitter’s 2013 Equity Incentive Plan and the applicable RSU and PRSU award agreements.

Termination of Employment and Payments .  Mr. Segal will participate Twitter’s Change of Control and Involuntary Termination Protection Policy applicable to its executive officers, as modified by the terms of his Participation Agreement.  Under this policy, if Mr. Segal is involuntarily terminated for any reason (including by him for good reason, as defined in the policy/Participation Agreement) other than cause (as defined in the policy/Participation Agreement), death or disability on or within 12 months following a change of control, he would be entitled to receive severance benefits as follows: (i) a lump sum severance payment equal to 100% of his annual base salary, (ii) payment for up to 12 months of COBRA premiums to continue health insurance coverage and (iii) the acceleration of vesting of 100% of the shares underlying all unvested equity awards held by him immediately prior to such termination. If Mr. Segal is involuntarily terminated for any reason (including by him for good reason) other than cause, death or disability outside the context of a change of control, Mr. Segal would be entitled to receive severance benefits as follows: (i) a lump sum severance payment equal to 100% of his annual base salary, (ii) payment for up to 6 months of COBRA premiums to continue health insurance coverage and (iii) the acceleration of vesting of 12.5% of the shares underlying all unvested equity awards held by him immediately prior to such termination.  

The foregoing descriptions of the Offer Letter, which is filed as Exhibit 10.1 to this Current Report on Form 8-K, and the form of Participation Agreement, which was filed as Exhibit 10.1 to Twitter’s Quarterly Report on Form 10-Q on August 11, 2014, are qualified in their entirety by reference to the full text of the Offer Letter and the Participation Agreement and are incorporated herein by reference.


Item 7.01.

Regulation FD Disclosure.

In announcing Mr. Segal as its new CFO, Twitter notes that this appointment is not related to Twitter’s previously-issued financial expectations.

Item 9. 01

Financial Statements and Exhibits.

(d) Exhibits.

 

Exhibit
Number

  

Description

 

10.1

 

 

Offer Letter between Twitter and Ned D. Segal, dated as of July 11, 2017.

99.1

 

Press Release issued by Twitter, Inc., dated July 11, 2017

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

TWITTER, INC.

 

 

 

 

 

By: /s/ Vijaya Gadde

 

 

Vijaya Gadde

General Counsel & Secretary

Date:  July 11, 2017



EXHIBIT INDEX

 

 

 

 

Exhibit
Number

  

Description

 

10.1

 

 

Offer Letter between Twitter and Ned D. Segal, dated as of July 11, 2017.

 

 

 

99.1

 

Press Release issued by Twitter, Inc., dated July 11, 2017

 

EXHIBIT 10.1

 

July 11, 2017

Mr. Ned Segal

Via email

Dear Ned,

On behalf of Twitter, Inc. (the “Company”), I am very pleased to offer you employment on the following terms (the “Agreement”).

 

1.

Position.   Your title will be Chief Financial Officer and you will report at the start of your employment to the Chief Executive Officer. You will be a regular full-time employee.

 

 

2.

Start Date .  Your employment will commence on a mutually agreeable date, but no later than September 1, 2017.

 

 

3.

Base Salary.   The Company will pay you a gross salary at an annualized rate of five hundred thousand dollars ($500,000), payable in accordance with the Company’s standard payroll schedule.  This salary will be subject to adjustment from time to time in accordance with the employee compensation policies then in effect.

 

 

4.

Cash Bonus .  Should the Company adopt an executive cash incentive compensation plan, you will become an eligible participant in the plan as of its adoption and effective date, along with other eligible executives at Twitter.

 

 

5.

Sign-On Bonus . The Company will pay you a sign-on bonus in the amount of three hundred thousand dollars ($300,000) and paid on the next regular payroll date after your date of hire.  Should your employment terminate for any reason other in connection with a Change in Control Event as defined in the Severance Policy referenced in paragraph 8 below, prior to the one year anniversary of your hire date, the sign-on bonus must be repaid to the Company reduced by the number of days of active employment from the date of hire through the date of termination.  

 


 

 

 

 

 

6.

Employee Benefits .  As an employee of the Company, you will be eligible to receive Company-sponsored benefits in accordance with the terms of the applicable benefit plans.  In addition, you will be entitled to paid vacation in accordance with the Company’s vacation policy, as in effect from time to time.

 

 

7.

Equity Compensation .  Subject to the approval of the Company’s compensation committee of the Board of Directors, you will be granted two stock awards:

 

794,444 Restricted Stock Units (“RSUs”). The RSUs will vest as follows provided you have been continuously employed by Twitter during each of the vesting dates and as described in Twitter’s 2013 Equity Incentive Plan (the “Equity Plan”):

 

250,000 RSUs will vest on the first day of the first month following the one-year anniversary of your hire date and 44,444 RSUs will vest on December 1, 2018

 

25% of 222,222 RSUs will vest on each of March 1, June 1, September 1 and December 1, 2019

 

25% of 138,889 RSUs will vest on each of March 1, June1, September 1 and December 1, 2020

 

25% of 138,889 RSUs will vest on each of March 1, June 1, September 1 and December 1, 2021

 

372,223 Performance-Based RSUs (the “PRSUs”).  The PRSUs will be eligible to vest based on the Company’s achievement of certain performance targets during the applicable performance periods, and subject to your continuous service through each vesting date.  The performance periods will be each of the next four fiscal years of the Company beginning with the Company’s 2017 fiscal year. The Company’s Board of Directors or its authorized committee will set the performance targets for each performance period in advance of the end of the applicable performance period, and, in the first quarter following each completed performance period, determine achievement against those performance targets.

 

For plan year 2017, you will be awarded 38,889 PRSUs at target (the “2017 PRSUs”). 27,222 of the 2017 PRSUs will be allocated to the Company’s absolute performance measure and will be earned, dependent on actual results against absolute performance metrics, as of December 31, 2017 and paid in first quarter of 2018 upon approval of the compensation committee of the Board of Directors. 11,667 of the 2017 PRSUs will be allocated to the Company’s relative

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performance measure and will be earned, dependent on actual results against the relative performance measure, as of December 31, 2018 and paid in the first quarter of 2019 upon approval of the compensation committee of the Board of Directors.

 

55,556 PRSUs will be granted for plan year 2018, 138,889 PRSUs will be granted for plan year 2019 and 138,889 PRSUs will be granted for plan year 2020. Those PRSUs will be eligible to vest based on the Company’s achievement of certain performance targets for performance periods as determined by the Compensation Committee, and in each case subject to your continuous service through each later-determined vesting date.

 

If the PRSU plan for any given performance year period is not approved by the compensation committee of the Board of Directors, the target PRSUs will be converted on a one-for-one basis into RSUs as follows and will vest in equal parts quarterly on each of February 1, May 1, August 1, and November 1 in the applicable year as referenced below.

 

2019 - 55,556 RSUs (FY 2018 performance)

2020 - 138,889 RSUs (FY 2019 performance)

2021 - 138,889 RSUs (FY 2020 performance)

 

The RSUs and Performance-Based RSUs will be subject to the terms and conditions set forth in the Equity Plan and the applicable RSU and PRSU award agreements. Please note that the terms of the Company’s equity plans are reviewed periodically, and subject to revision at the Company’s sole discretion.

 

 

8.

Severance.    At the next available meeting after you execute this Agreement, we will seek approval from the compensation committee of the Board of Directors for your participation in our Change of Control and Involuntary Termination Protection Policy, as amended and restated effective August 8, 2014 (the “Severance Policy”), based on your senior position with the Company, in the form of which is enclosed and made part of this Agreement.  Should your employment be terminated by the Company at any time without “Cause” or should you terminate employment with the Company for “Good Reason” you will be entitled to the benefits described in the Severance Policy. You will be provided a participation agreement under the Severance Policy outlining the payments and benefits for which you will be eligible.  You will be asked to return an executed copy to the Company.  The payments and benefits under the Severance Policy will be in lieu of any other severance or other benefits you would otherwise be entitled to under any plan, program or policy that the Company may have been in effect from time to time.

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You shall be covered by the Company’s indemnification policies including Directors and Officers Insurance, which coverage is vested and shall survive and continue through all limitations periods and not be diminished or released by the Release Requirement (as defined in the Severance Policy).

 

 

9.

Employee Invention Assignment and Confidentiality Agreement.   You will be required, as a condition of your employment with the Company, to sign the Company’s standard Employee Invention Assignment and Confidentiality Agreement (“Confidentiality Agreement”).  A copy of the Confidentiality Agreement will be provided to you for your review.

 

 

10.

Employment Relationship .  Employment with the Company is for no specific period of time.  Your employment with the Company will be “at will,” meaning that either you or the Company may terminate your employment at any time and for any reason, with or without cause.  This is the full and complete agreement between you and the Company regarding the duration of the employment relationship.  

 

 

11.

Outside Activities.   While you render services to the Company, you agree that you will not engage in any other employment, consulting, or other business activity that would create a conflict of interest with the Company, which includes engaging in any work that is competitive in nature.  You will be permitted to join one outside corporate board of directors, subject to Company approval, no earlier than one year from your hire date. While you render services to the Company, you also agree to not assist any person or entity in competing with the Company, in preparing to compete with the Company, or in hiring any employees or consultants of the Company. In addition, for a period of one (1) year after the termination of your services, you agree to not solicit either directly or indirectly, any employee of the Company to leave the Company for other employment or assist any person or entity in doing the same.

 

 

12.

Taxes . All forms of compensation that are subject to income or payroll taxes will be reduced to reflect applicable income tax withholding and payroll taxes.  Any form of compensation that is subject to income or payroll taxes and that is not paid in cash will result in a reduction in cash compensation to reflect applicable income tax withholding and payroll taxes.

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13.

Dispute Resolution.   We sincerely hope that no dispute will arise between us.  If a dispute should arise, it can be resolved through the Company’s Dispute Resolution Agreement, which is enclosed for your signature. Notwithstanding the foregoing, any disputes arising out of or relating to the Severance Policy shall not be subject to the Dispute Resolution Agreement, but shall be resolved exclusively under the ERISA terms and procedures set out in the Severance Policy.

 

 

14.

Entire Agreement .  This Agreement, along with the Confidentiality Agreement, the Severance Policy and the documents governing the equity award(s) described herein, supersede and replace any prior agreements, representations or understandings, whether written, oral or implied, between you and the Company relating to the subject matters described herein.  This Agreement may not be amended or modified, except by an express written agreement signed by both you and a duly authorized officer of the Company.  

 

Please indicate your acceptance of this Agreement, and confirmation that it contains our complete agreement regarding the terms and conditions of your employment, by signing the bottom portion of this Agreement and returning a copy to me prior to close of business PST on Tuesday, July 11, 2017.

 

Very truly yours,

 

Twitter, Inc.

 

By

 

/s/ Jack Dorsey

 

 

 

 

 

Jack Dorsey, Chief Executive Officer

 

I have read, understood and accept all the provisions of this Agreement:

/s/ Ned Segal

 

Ned Segal

 

July 11, 2017

 

Date

 

Page 5

Exhibit 99.1

 

FOR IMMEDIATE RELEASE

 

Twitter Announces Appointment of Ned Segal as Chief Financial Officer

 

SAN FRANCISCO, California – July 11, 2017 – Twitter, Inc. (NYSE: TWTR) today announced the appointment of Ned Segal as Chief Financial Officer (CFO), effective in late August. Mr. Segal will assume the CFO role from Anthony Noto, Twitter’s Chief Operating Officer and Chief Financial Officer. Mr. Noto will continue to serve as Twitter’s Chief Operating Officer, the position he assumed in November 2016.

 

Mr. Segal brings to Twitter more than 20 years of finance and capital markets experience, an extensive background in financial planning and operations, management and strategy, and a deep knowledge of the technology industry. He most recently served as Senior Vice President of Finance for the Small Business Group at Intuit Inc., where he led financial and strategic planning for the company’s $2.5 billion division that delivers QuickBooks, Payments and Payroll to millions of customers.  Prior to his role at Inuit, Mr. Segal served as CFO of RPX Corporation, a public patent risk management solutions company, and for many years at Goldman Sachs in numerous roles around the technology capital markets, most recently as Managing Director and Head of Global Software Investment Banking. Mr. Segal began his career at Goldman Sachs in Equity Research Sales, where he focused on technology companies and worked with many of the most renowned technology investors.

 

“Ned’s experience in financial operations as a public company and business unit CFO, along with his background serving technology companies and investors, are an ideal fit for Twitter as we work to extend our positive momentum, continue growing our audience and achieve greater operating efficiency,” said Jack Dorsey, Chief Executive Officer of Twitter. “He brings a principled, engaging and rigorous approach to the CFO role, with a track record of driving profitable growth.”

 

“I’ve long admired Twitter’s impact in the world, and I’m committed to helping the Company build on its recent momentum, allocate resources against its greatest priorities, and continue toward its goal of GAAP profitability and beyond,” said Mr. Segal.  “Twitter has a talented management team, a unique purpose and tremendous potential. I look forward to putting my background and skills to work to help the Company achieve greater results for our employees and shareholders.”

 

As CFO, Mr. Segal will report directly to Mr. Dorsey and will oversee Twitter’s finance, accounting, corporate development, corporate security, financial planning & analysis (FP&A), investor relations, real estate & workplace, internal audit, tax and treasury areas of the business.

 

The Company noted that Mr. Segal’s appointment as CFO is unrelated to financial expectations provided in its Q1'17 shareholder letter issued on April 26, 2017. Twitter will release financial results for the second quarter of 2017 on July 27, 2017, before the market open at approximately 4:00 a.m. Pacific Time (7:00 a.m. Eastern Time). On the same day, Twitter will host a conference call to discuss these financial results at 5:00 a.m. Pacific Time (8:00 a.m. Eastern Time). To listen to a live audio webcast, please visit the company’s Investor Relations page at investor.twitterinc.com.

 

About Ned Segal

Ned Segal most recently has served as Senior Vice President of Finance for Intuit's Small Business Group. As finance lead for Intuit's $2.5 billion division that delivers QuickBooks, Payments, and Payroll to millions of small businesses and self-employed customers in the U.S. and seven other countries, he was responsible for the division's financial and strategic planning.  Before joining Intuit, Mr. Segal served as

 


Exhibit 99.1

 

Chief Financial Officer of RPX (NASDAQ: RPXC), the leader in patent risk management solutions to technology companies around the world. In this role he was responsible for forecasting and planning, accounting, investor relations, and other financial, strategic and operational matters.  Prior to RPX, he spent 17 years at Goldman Sachs, initially serving in equity research sales from 1996 to 2004. Mr. Segal transitioned to Goldman Sachs’ Technology, Media, and Telecom Investment Banking Group in 2005, and from 2009 to 2013 served as Managing Director, Head of Global Software Investment Banking.  In this capacity, he advised technology companies from around the world on mergers, acquisitions, IPOs, and other equity and debt financings, and led Goldman Sachs’ investments in multiple technology companies.  Mr. Segal received his B.S. from Georgetown University and currently serves as a Trustee of Town School for Boys and a Board Member of the Georgetown Technology Alliance.

 

About Twitter, Inc.

Twitter, Inc. (NYSE: TWTR) is what’s happening in the world and what people are talking about right now. On Twitter, live comes to life as conversations unfold, showing you all sides of the story. From breaking news and entertainment to sports, politics and everyday interests, when things happen in the world, they happen first on Twitter. Twitter is available in more than 40 languages around the world. The service can be accessed at twitter.com, on a variety of mobile devices and via SMS. For more information, visit about.twitter.com or follow @twitter. For information on how to download the Twitter and Periscope apps, visit twitter.com/download and periscope.tv.

 

Contacts

 

Investors:

Cherryl Valenzuela

ir@twitter.com

 

Press:

Kristin Binns

press@twitter.com