UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM | |||||||||||
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification Number) | ||||||
(Address of principal executive offices including zip code)
(408 ) 727-1885
(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:
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).
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||
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 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
As previously disclosed on the Current Report on Form 8-K filed with the SEC on November 30, 2022, the Board of Directors (the “Board”) of 8x8 Inc. (the “Company”) appointed Kevin Kraus to serve as Interim Chief Financial Officer, effective as of November 30, 2022, and such disclosure is hereby incorporated by reference herein.
On June 5, 2023, the Board appointed Mr. Kraus as permanent Chief Financial Officer (“CFO”) of the Company. In connection with Mr. Kraus’s appointment as permanent CFO, the Company and Mr. Kraus entered into a promotion letter, dated as of June 5, 2023, which provides for the following compensation and benefits: (i) annual base salary of $420,000 per year, (ii) target cash bonus of 65% of his annual base salary, (iii) participation in the Company’s retirement, health and welfare, vacation and other benefit programs, (iv) an award of restricted stock units (“RSUs”), representing the right to acquire shares of the Company’s common stock valued at $1,105,500 with the actual number of RSUs to be determined by dividing the value of the RSUs by the greater of $5.00 or the trailing 20-trading-day average of the Company’s closing stock price prior to the date of grant, vesting over a three-year period, with one-third (1/3) of the total number of RSUs vesting on the first anniversary of the grant date, and the remaining two-thirds (2/3) of the RSUs vesting on a quarterly basis thereafter until fully vested, (v) and an award of performance share units (“PSUs”), representing the right to acquire shares of the Company’s common stock equal to the same number of RSUs, in three tranches over a four-year vesting period, with performance-based vesting terms as previously disclosed on the Current Report on Form 8-K filed with the SEC on May 31, 2023, and such disclosure is hereby incorporated by reference herein. Mr. Kraus will also continue to be eligible to receive benefits under the Company’s 2017 Executive Change-in-Control and Severance Policy, as amended and restated as of May 13, 2021.
The foregoing description of Mr. Kraus’s promotion letter does not purport to be complete and is qualified in its entirety by reference to the full text of the promotion letter, a copy of which is attached hereto as Exhibit 10.1 and is hereby incorporated by reference herein.
The Company will also enter into its standard form of indemnification agreement with Mr. Kraus, the form of which is filed as Exhibit 10.3 to the Company’s Form 10-Q filed on August 3, 2015. The Company will also provide reasonable directors’ and officers’ insurance coverage for Mr. Kraus on terms at least as favorable as any coverage provided to other officers and directors of the Company.
Mr. Kraus does not have any family relationships with any director or executive officer of the Company, 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.
Item 7.01 Regulation FD Disclosure.
The Company issued a press release on June 6, 2023, announcing the changes to the Company’s executive leadership team as described herein. The press release making this announcement is filed as Exhibit 99.1 to this Current Report on Form 8-K and hereby incorporated by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit | Description | ||||
| 10.1 | |||||
| 99.1 | |||||
| 104 | Cover Page Interactive Data File, formatted in Inline XBRL. | ||||
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.
Date: June 6, 2023
8x8, Inc. | ||
By: /s/ Laurence Denny | ||
Laurence Denny | ||
Chief Legal Officer & Corporate Secretary | ||
June 5, 2023
Mr. Kevin Kraus
RE: 8x8, Inc. Chief Financial Officer
Dear Kevin,
On behalf of 8x8, Inc., a Delaware corporation (“8x8” or the “Company”), I am pleased to provide this letter memorializing your promotion from Interim Chief Financial Officer to the position of Chief Financial Officer.
1.Position. As Chief Financial Officer, you will have responsibilities as determined by your manager, which shall be the Company's Chief Executive Officer. Your duties and responsibilities are subject to change depending on the needs of the Company.
2.Compensation.
a.Base Salary. You will be paid an annualized salary of $420,000 payable in accordance with the Company’s standard payroll policies.
b.Salary Review. Your base salary will be reviewed as part of the Company’s normal salary review process.
c.Expenses. You will be reimbursed for all reasonable and necessary business expenses incurred in the performance of your duties as provided in the Company’s Employee Handbook.
3.One-Time Equity Grants. In connection with your promotion to the position of Chief Financial Officer, you will receive the following additional equity grants:
a.Promotion RSU Award. On or about June 15, 2023, you will be granted an equity award of approximately $1,105,500 in value of restricted stock units representing rights to acquire shares of 8x8’s common stock upon vesting (the “Promotion RSU Award”). The Promotion RSU Award will vest over a three-year period, with one-third (1/3) vesting on the first anniversary of the effective date of your promotion and the remainder vesting in eight substantially equal quarterly installments, subject to your continued employment or other qualifying association with the Company or any of its affiliates through each applicable vesting date; provided that if your employment is terminated by the Company without Cause (as defined in the 8x8, Inc. 2017 Executive Change-in-Control and Severance Policy, as amended and restated as of May 13, 2021, and as may be further amended or restated from time to time (the “Policy”)) or you resign for Good Reason (as defined in the Policy), then any unvested portion of the Promotion RSU Award shall immediately accelerate and vest in full as of such termination date. The actual number of shares subject to the Promotion RSU Award will be determined by dividing the value of the Promotion RSU Award by the greater of $5 or the trailing 20-trading-day average of 8x8’s closing stock price prior to the date of grant. Except as otherwise set forth herein, the Promotion RSU Award will be subject to the terms and conditions of the 8x8, Inc. 2022 Equity Incentive Plan (the “Equity Incentive Plan”) and an award agreement between the Company and you in the Company’s standard form.
b.Promotion PSU Award. On or about June 15, 2023, you will be granted a performance-based equity award of performance stock units representing rights to acquire shares of 8x8’s common stock upon vesting equal to the number shares subject to the Promotion
RSU Award (the “Promotion PSU Award”). The Promotion PSU Award will vest as set forth on Exhibit A attached hereto. Except as otherwise set forth herein, the Promotion PSU Award will be subject to the terms and conditions of the Equity Incentive Plan and an award agreement between the Company and you in the Company’s standard form.
4.Annual Incentives.
a.Cash Incentive Plan. You will continue to be eligible to participate in 8x8’s discretionary cash incentive plan. As Chief Financial Officer, your total annual target bonus will be 65% of your annual base salary.
b.Equity Incentive Plan. You will continue to be eligible in future fiscal years to receive annual equity grants as determined by the Board of Directors of the Company (the “Board”) pursuant to Equity Incentive Plan.
5.Severance Benefits. You will be eligible for benefits under the Policy in accordance with the terms thereof. Such benefits include potential vesting acceleration of stock-based compensation and/or cash severance upon the termination of your employment under specified circumstances, including in connection with a Change-in-Control (as defined in the Policy), subject to the terms and conditions of the Policy.
6.Employee Benefits. The Company will continue to make available to you standard vacation, medical and dental insurance benefits. The Company will also continue to make available to you a 401(k) plan. You will continue to be eligible to participate in the Company’s Employee Stock Purchase Plan upon enrollment by February 1st or August 1st of any year.
7.At-Will Employment; Employee Handbook and Policies. You will continue to be an at-will employee of the Company, meaning that either you or the Company may terminate your employment at any time, without notice, for any reason or no reason, subject to applicable law. You shall continue to comply with Company policies, including those set forth in the Company’s Employee Handbook, and the Confidentiality Information and Inventions Assignment Agreement by and between you and the Company.
Congratulations on your promotion!
Sincerely,
/s/ Jaswinder Pal Singh
Jaswinder Pal (J.P.) Singh
Chairman of the Board
Chairman of the Board
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Exhibit A
PSU Vesting Schedule
PSU Vesting Schedule
The following sets forth the performance goals and performance period to be used with the Promotion PSU Award.
Summary:
The Promotion PSU Award will vest only upon the satisfaction of both time- and performance-based vesting conditions over a four-year period (“Performance Period”), in three substantially equal tranches as follows:
Tranche | Share Price Performance Goal | Time-Based Vesting Requirement | ||||||
| Tranche 1 | 70% increase in share price | First-year anniversary of the grant date | ||||||
Tranche 2 | 100% increase in share price | Second-year anniversary of the grant date | ||||||
Tranche 3 | 130% increase in share price | Third-year anniversary of the grant date | ||||||
The increase in share price will be measured by the 20-day trailing average (based on trading days) of the Company’s closing stock prior to the grant date over any 20-day trailing average period during the Performance Period.
For the purposes hereof, one-third of the total number of eligible PSUs will vest following each of the first-year, second-year and third-year anniversaries of the grant date, subject to achieving the share price performance goal for each applicable tranche (rounded down to the nearest whole share of common stock, if applicable). If a share price performance goal is achieved prior to the time-based vesting requirement (i.e., first, second and third year anniversary of the grant date), then the Promotion PSU Award will not vest until the time-based vesting requirement has been satisfied. If the time-based vesting requirement is satisfied prior to the applicable share price performance goal, then the Promotion PSU Award will vest on the 15th day of the month following the achievement of the applicable share price performance goal.
If Tranche 1 has not been achieved during the Performance Period, one hundred percent (100%) of the PSUs will be forfeited. If Tranche 1 has been achieved but not Tranche 2 within the Performance Period, sixty-six point six percent (66.6%) of the PSUs will be forfeited. If Tranche 2 has been achieved but not Tranche 3 within the Performance Period, thirty-three point three (33.3%) of the PSUs will be forfeited.
The determination of the number of shares of Company common stock that performance vest based on the applicable share price performance goals will not be determined through linear interpolation. Each of the share price performance goals applicable to each tranche must be met for the corresponding number of PSUs to performance vest.
In addition, and notwithstanding anything herein to the contrary, vesting of each tranche is subject to continued employment or other association with the Company through the achievement of both the time- and performance-based vesting requirements of each tranche during the Performance Period.
General Provisions:
Administration: This Promotion PSU Award shall be administered by the Compensation Committee of the Company’s Board of Directors (the “Committee”) in accordance with the 2022 Equity Incentive Plan.
Payment of Awards: The Committee shall use reasonable efforts to issue any shares underlying such vested PSUs within thirty (30) days following the vesting of each tranche during the Performance Period but in any event no later than 21/2 months following the calendar year in which such PSUs vested.
Disputes: All disputes with respect to this Promotion PSU Award will be resolved by the Committee, whose decision will be final.
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8x8 Appoints Kevin Kraus as Chief Financial Officer
CAMPBELL, Calif. – June 6, 2023 — 8x8, Inc. (NASDAQ: EGHT), a global leader in unified communications and contact center solutions, today announced the appointment of Kevin Kraus as Chief Financial Officer (CFO).
Kraus has served as 8x8’s interim CFO since November 2022. Prior to that, he served as the company’s Senior Vice President of Finance with responsibility for financial planning and analysis and procurement functions. He brings a wealth of financial expertise and a strong track record in strategic growth to the role, demonstrating his commitment to building both successful and sustainable businesses. In his new position, Kraus will lead 8x8's global finance and accounting organizations, overseeing financial planning and operations.
“Kevin’s promotion to the CFO role is well deserved and his experience driving both operational efficiency and profitable growth make him a perfect fit for the role,” said Samuel Wilson, CEO at 8x8, Inc. “His strategic insight, coupled with his deep financial acumen, will be invaluable as we continue to evolve our business.”
Prior to joining 8x8 in 2019, Kraus served as Vice President of Finance for Imperva, a cybersecurity software company, and was Senior Director of Finance for Gigamon, a network visibility and traffic monitoring technology company, from 2015 until 2017. Kraus’s experience includes responsibilities for financial planning and analysis, procurement, facilities management, SEC reporting and investor relations, sales compensation operations, and M&A integration.
“I'm incredibly excited to continue leading the finance and accounting organization for 8x8 as chief financial officer,” said Kevin Kraus. “We have a clear vision and a strong commitment to innovation and customer success. I look forward to contributing to the company’s continued growth and helping it achieve its strategic goals.”
8x8 remains committed to expanding the 8x8 XCaaS™ (eXperience Communications as a Service™) integrated cloud Contact Center and Unified Communications platform. The company is investing in building its ecosystem of innovative technology and service partners to expand the portfolio of AI/ML solutions available on the 8x8 XCaaS platform and to deliver superior communications experiences to businesses around the world. The appointment of Kraus to the leadership team positions the company well for strategic growth and investment in innovation that will transform customer communications experiences.
Caution Concerning Forward-Looking Statements
This press release contains forward-looking statements related to the Company’s future product strategies, investments in innovation, and new opportunities for growth and market leadership. Readers are cautioned that such forward-looking statements involve risks and uncertainties that could cause actual events or our actual results to differ materially from those expressed in any such forward-looking statements. Readers are directed to 8x8’s periodic and other reports filed with the Securities and Exchange Commission (SEC) for a description of such risks and uncertainties. 8x8 undertakes no obligation to update any forward-looking statements.
About 8x8 Inc.
8x8, Inc. (NASDAQ: EGHT) is transforming the future of business communications as a leading Software as a Service provider of 8x8 XCaaS™ (eXperience Communications as a Service™), an integrated contact center, voice communications, video, chat, and SMS solution built on one global cloud communications platform. 8x8 uniquely eliminates the silos between Unified Communications as a Service (UCaaS) and Contact Center as a Service (CCaaS) to power the communications requirements of all employees globally as they work together to deliver differentiated customer experiences. For additional information, visit www.8x8.com, or follow 8x8 on LinkedIn, Twitter and Facebook.
8x8®, 8x8 XCaaS™, eXperience Communications as a Service™, eXperience Communications Platform™ are trademarks of 8x8, Inc.
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