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): August 3, 2015
ZILLOW GROUP, INC.
(Exact name of registrant as specified in its charter)
| Washington | 001-36853 | 47-1645716 | ||
|
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification Number) |
||
| 1301 Second Avenue, Floor 31, Seattle, Washington | 98101 | |||
| (Address of principal executive offices) | (Zip Code) | |||
(206) 470-7000
https://twitter.com/zillowgroup
(Registrant’s telephone number, including area code)
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:
| ¨ | 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)) |
| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On August 3, 2015, the board of directors (the “Board”) of Zillow Group, Inc. appointed Kathleen Philips, currently Zillow Group’s Chief Operating Officer, as Zillow Group’s Chief Financial Officer and Treasurer, effective as of August 7, 2015, to succeed Chad Cohen, whose resignation has previously been announced and will be effective on the same date. Ms. Philips will no longer serve as Zillow Group’s Chief Operating Officer, as of the effective date of her new position, and will continue to serve as Zillow Group’s Chief Legal Officer and Corporate Secretary. In her capacity as Chief Financial Officer, Ms. Philips will also serve as Zillow Group’s principal accounting officer. In connection with her appointment as Chief Financial Officer and Treasurer, the Board increased Ms. Philips’ base salary to $450,000.
Ms. Philips, 48, served as Zillow Group’s predecessor, Zillow, Inc.’s (“Zillow’s”) Chief Operating Officer since August 2013. Ms. Philips served as Zillow’s General Counsel from July 2010 to September 2014 and as Zillow’s Chief Legal Officer from September 2014 to February 2015. Ms. Philips has served as Zillow Group’s Chief Operating Officer, Chief Legal Officer and Secretary since February 2015. Ms. Philips served as General Counsel at FanSnap, Inc., a search engine for live event tickets, from June 2008 to June 2010, as General Counsel at Pure Digital Technologies, Inc., the producer of Flip Video camcorders, from September 2007 to June 2008, and as General Counsel at StubHub, Inc., an online live event ticket marketplace, from May 2005 to April 2006. Ms. Philips served as General Counsel at Hotwire, Inc., an online travel company, from 2001 to 2004 and as its Corporate Counsel from 2000 to 2001. Ms. Philips was an attorney in private practice at Cooley Godward LLP from 1998 to 2000 and at Stoel Rives LLP from 1997 to 1998. Ms. Philips holds a B.A. in Political Science from the University of California, Berkeley, and a J.D. from the University of Chicago.
On August 3, 2015, the Board also appointed Amy C. Bohutinsky, currently Zillow Group’s Chief Marketing Officer, as Zillow Group’s Chief Operating Officer, effective as of August 7, 2015. Ms. Bohutinsky will no longer serve as Chief Marketing Officer as of the effective date of her new position. In connection with her appointment as Chief Operating Officer, the Board increased Ms. Bohutinsky’s base salary to $450,000.
Ms. Bohutinsky, 40, served as Zillow’s Chief Marketing Officer from March 2011 to February 2015, when she became Zillow Group’s Chief Marketing Officer. Since joining Zillow in 2005, Ms. Bohutinsky has held many leadership positions, including Vice President of Marketing and Communications from September 2010 to March 2011, Vice President of Communications between August 2008 and September 2010, and Director of Communications between August 2005 and August 2008. From 2001 to 2005, Ms. Bohutinsky held many leadership positions at Hotwire, Inc., including Director of Corporate Communications. Ms. Bohutinsky previously worked for Blanc & Otus, a technology public relations firm, from 2000 to 2001 and was formerly a broadcast journalist with various local network affiliates. Ms. Bohutinsky serves on the board of directors of Avvo, Inc., a privately held online legal marketplace, and Hotel Tonight, Inc., a privately held mobile-based hotel booking service. Ms. Bohutinsky holds a B.A. in Journalism and Mass Communications from Washington & Lee University.
On August 3, 2015, the Board appointed Greg Schwartz, currently Zillow Group’s Chief Revenue Officer, as Zillow Group’s Chief Business Officer, effective as of August 7, 2015. Mr. Schwartz, 43, served as Zillow’s Chief Revenue Officer from September 2010 to February 2015, at which time he became Chief Revenue Officer of Zillow Group. Prior to his promotion to Chief Revenue Officer of Zillow, Mr. Schwartz served as its Vice President of Sales from March 2007 to September 2010. Prior to joining Zillow, Mr. Schwartz was Vice President of Advertising Sales at CNNMoney.com, a financial media company, from July 2005 to March 2007. From August 2001 to July 2005, Mr. Schwartz served as National Accounts Director for the Automotive and Finance Properties of Yahoo!, Inc., an online search company. Mr. Schwartz held various positions at DoubleClick, Inc., an online advertising company, from 1998 to 2000, including Director of Business Development. Mr. Schwartz holds a B.A. in Political Science from Hamilton College.
Mr. Schwartz’s bonus letter agreement (the “Letter Agreement”) with Zillow Group that describes the terms of his annual incentive cash-based bonus opportunities was amended and restated, effective as of August 3, 2015, to allow the Compensation Committee of the Board, in its discretion, to award a bonus at less than the target amount in the event a performance metric is achieved at 95% or greater of the target goal. The foregoing description of the amended and restated Letter Agreement is qualified in its entirety by reference to the full text of the amended and restated Letter Agreement, a copy of which is attached as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
|
Exhibit Number |
Description |
|
| 10.1 | Amended and Restated Letter Agreement dated August 3, 2015, by and between Zillow Group, Inc. and Greg M. Schwartz | |
| 99.1 | Press release dated August 3, 2015 entitled “Zillow Group Announces Key Executive Promotions” issued by Zillow Group, Inc. on August 3, 2015. | |
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.
| Dated: August 3, 2015 | ZILLOW GROUP, INC. | |||||
| By: |
/s/ Spencer M. Rascoff |
|||||
| Name: | Spencer M. Rascoff | |||||
| Title: | Chief Executive Officer | |||||
EXHIBIT INDEX
|
Exhibit Number |
Description |
|
| 10.1 | Amended and Restated Letter Agreement dated August 3, 2015, by and between Zillow Group, Inc. and Greg M. Schwartz | |
| 99.1 | Press release dated August 3, 2015 entitled “Zillow Group Announces Key Executive Promotions” issued by Zillow Group, Inc. on August 3, 2015. | |
Exhibit 10.1
August 3, 2015
Mr. Greg M. Schwartz
Zillow Group, Inc.
1301 Second Ave., Floor 31
Seattle, WA 98101
Re: Amended and Restated Bonus Letter Agreement
Dear Greg:
This amended letter agreement (“ Agreement ”) amends and restates in its entirety, as of the date set forth above, that letter agreement previously entered into by and between you and Zillow Group, Inc., a Washington corporation (the “ Company ”), effective as of January 1, 2015 (the “ Effective Date ”).
1. Purpose. The purpose of this Agreement is to set forth the terms and conditions governing your opportunity to earn annual cash-based awards based on achievement of identified revenue measures described below. The bonus opportunities granted under this Agreement are intended to be cash-based awards under Section 12 of the Zillow Group, Inc. Amended and Restated 2011 Incentive Plan, as amended and/or restated from time to time (the “ Plan ”).
2. Term. This Agreement is effective as of the Effective Date and shall remain in effect until the earlier of its termination by the Compensation Committee of the Board of Directors (the “ Compensation Committee ”), subject to Section 9 hereof, or your termination of employment or service with the Company (the “ Term ”). This Agreement does not guarantee your employment, the terms of which continue to be governed by your employment agreement with the Company.
3. Elements of the Bonus Opportunity. You will be eligible to earn annual cash bonuses (each, a “ Bonus ”) in the amounts and based on achievement of the performance metrics and during the performance periods set forth below:
| a. | Total Revenue Bonus: You will be eligible to receive a $50,000 semi-annual Bonus based on targeted Company total revenue during the applicable performance periods (“ Total Revenue ”). Total Revenue will be calculated under U.S. generally accepted accounting principles except as otherwise provided herein. The Compensation Committee will annually approve Total Revenue targets for each of the performance periods January 1 through June 30 and July 1 through December 31. No amount will be paid with respect to a six-month period if the Total Revenue target is not achieved for such period; provided, however, that if at least 95% of the Total Revenue target is achieved for a six-month period, the Compensation Committee may, in its discretion, approve a Bonus payment of less than the full amount of the target Bonus for such period. The amount of the Bonus for a six-month period will increase on a straight percentage basis to the extent Total Revenue exceeds Total Revenue target. Any Bonus payments will be calculated and paid as soon as practicable following completion of the applicable six-month period but in any event by no later than 74 days after completion of such period. |
| b. | Agent Revenue Bonus: You will be eligible to receive a $25,000 semi-annual Bonus based on targeted Agent Revenue during the applicable performance periods. “ Agent Revenue ” will be calculated as revenue from Zillow Premier Agent and Trulia agent products. The Compensation Committee will annually approve the targeted Agent Revenue for each of the performance periods January 1 through June 30 and July 1 through December 31. No amount will be paid with respect to a six-month period if the revenue target is not achieved for such period; provided, however, that if at least 95% of the Agent Revenue target is achieved for a six-month period, the Compensation Committee may, in its discretion, approve a Bonus payment of less than the full amount of the target Bonus for such period. The amount of the Bonus for a six-month period will increase on a straight percentage basis to the extent that generated revenue exceeds target. Any Bonus payment will be calculated and paid as soon as practicable after the end of the applicable six-month period but in any event by no later than 74 days after completion of such period. |
| c. | Other Real Estate Revenue Bonus: You will be eligible to receive a $25,000 semi-annual Bonus based on targeted other real estate revenue (i.e., revenue generated by Rentals, StreetEasy, and Diverse Solutions) during the applicable performance periods. The Compensation Committee will annually approve the targeted other real estate revenue for each of the performance periods January 1 through June 30 and July 1 through December 31. No amount will be paid with respect to a six- month period if the revenue target is not achieved for such period; provided, however, that if at least 95% of the targeted Other Real Estate Revenue is achieved for a six-month period, the Compensation Committee may, in its discretion, approve a Bonus payment of less than the full amount of the target Bonus for such period. The Bonus payment for a six- month period will increase on a straight percentage basis to the extent that generated revenue exceeds target. Any Bonus payment will be calculated and paid as soon as practicable after the end of the applicable six-month period but in any event by no later than 74 days after completion of such period. |
| d. | Calculation of Revenue and Compensation Committee Certification. For each of the performance metrics set forth above, the following will be excluded from the calculation of the applicable revenue measure: (a) revenue generated by Market Leader; and (b) fair value-based purchase accounting adjustments for deferred revenue (if any). At the conclusion of a performance period and prior to the payment of any Bonus for a performance period, the Compensation Committee will certify in writing the extent to which the performance goals applicable for the performance period were achieved or exceeded, the final amount of the Bonus payable to you with respect to such period, and any other material terms. |
| e. | Continued Employment. Payment of any Bonus under this Agreement is subject to your continued employment or service to the Company on a full-time basis through the last day of each applicable performance period (i.e., the six-month period over which performance for a Bonus payout is measured). Bonuses will be paid in cash in a single, lump sum payment, subject to applicable payroll taxes and tax withholding. |
| f. | Dollar Limitations. The total Bonus payouts under this Agreement shall not exceed $2,000,000 in any calendar year. |
4. Recoupment. In the event that revenue upon which a Bonus was calculated is determined to have been overstated as a result of your misconduct, you will be required to reimburse the Company for any Bonus payment received based upon such revenue and will not be eligible to receive any Bonus payment otherwise accrued but unpaid based upon such revenue. Recoupment of any Bonus shall otherwise be required to the extent required by applicable law or the terms of a Company’s clawback policy, as then in effect and as it may be amended from time to time (the “ Policy ”), to the extent that the Policy applies to such Bonus.
5. Assignment. This Agreement is personal to you and cannot be assigned by you. All of the terms and provisions of this Agreement shall be binding upon and shall inure to the benefit of and be enforceable by the parties hereto and their respective successors and permitted assigns.
6. Administration. The Compensation Committee will administer this Agreement. You understand that the Compensation Committee may adjust revenue targets or other terms set forth herein as a result of acquisitions, divestitures, or other extraordinary events or conditions during a calendar year. Subject to the last sentence of this Section 6, the Compensation Committee further may adjust the Bonus amounts set forth in Section 3 of this Agreement for calendar years 2016 and beyond, in its discretion. Any determinations made by the Compensation Committee with respect to this Agreement and any payouts thereunder will be final and binding on you. Notwithstanding anything to the contrary in this Agreement, in the event the Compensation Committee specifies that bonus opportunities for a performance period under this Agreement are governed by Section 16 of the Plan, the Compensation Committee shall have the power to administer this Agreement in a manner intended to ensure that this Agreement satisfies all requirements for “performance-based compensation” within the meaning of Section 162(m)(4)(C) of the Code and any successor provision thereto.
7. Applicable Law. This Agreement will in all respects, including all matters of construction, validity and performance, be governed by, and construed and enforced in accordance with, the laws of the State of Washington, without regard to any rules governing conflicts of laws.
8. No Trust or Fund. Each Bonus that may become payable under this Agreement will be paid solely from the general assets of the Company. Nothing in this Agreement should be construed to create a trust or to establish or evidence your claim of any right to payment of a Bonus other than as an unsecured general creditor with respect to any payment to which you may be entitled.
9. Amendment. The Compensation Committee reserves the right to unilaterally amend, modify or terminate this Agreement at any time, except that any such amendment (other than amendments or adjustments permitted by Section 6 of this Agreement and, for the avoidance of doubt, Section 16 of the Plan), modification or termination may not, without your written consent, materially adversely affect your rights with respect to any six- month period for which the Compensation Committee has previously approved revenue targets pursuant to Section 3 of this Agreement. Notwithstanding the foregoing, the Compensation Committee may amend this Agreement at any time as it deems necessary or desirable to avoid adverse tax consequences under Section 409A of the Internal Revenue Code of 1986, as amended.
10. Entire Agreement. This Agreement, on and as of the Effective Date, constitutes the entire agreement between the Company and you with respect to the subject matter hereof, and all prior or contemporaneous oral or written communications, understandings or agreements between the Company and you with respect to such subject matter (including, without limitation, the Letter Agreement dated June 16, 2014 by and between you and the Company (the “ 2014 Letter Agreement ”)) are hereby superseded in their entirety, except as otherwise provided herein. For the avoidance of doubt, the 2014 Letter Agreement shall be deemed terminated as of the Effective Date, provided, however, that those provisions of the 2014 Letter Agreement that must survive in order to give proper effect to their intent shall survive such termination. This Agreement may be executed in counterparts.
11. Severability. If any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision of this Agreement or any action in any other jurisdiction, but this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.
IN WITNESS WHEREOF, the parties have executed and entered into this Agreement as of the date first set forth above.
| GREG M. SCHWARTZ | ZILLOW GROUP, INC. | |||||
|
/s/ Greg M. Schwartz |
/s/ Spencer M. Rascoff |
|||||
| Print Name: | Spencer M. Rascoff | |||||
| Title: | Chief Executive Officer | |||||
Exhibit 99.1
Media Contact:
Jill Simmons, Zillow
206-757-2701 or press@zillow.com
Zillow Group Announces Key Executive Promotions
Kathleen Philips Named Chief Financial Officer; Amy Bohutinsky Named Chief Operating Officer
SEATTLE, August 3, 2015 – Zillow ® Group (NASDAQ:Z), which houses a portfolio of the largest and the most vibrant real estate and home-related brands on mobile and Web, today announces two key executive promotions. Kathleen Philips, who has been the company’s Chief Operating Officer since 2013, has been named Chief Financial Officer, Zillow Group. Amy Bohutinsky, who has been Chief Marketing Officer since 2011, has been promoted to Chief Operating Officer, Zillow Group.
Kathleen Philips has been a critical part of Zillow Group’s executive team since joining the company in 2010 as General Counsel, and has spent the last two years as Chief Operating Officer. As COO, she ran mergers and acquisitions, corporate development, human resources, legal and customer support. Philips played a pivotal role in all of Zillow’s key corporate finance initiatives, including Zillow’s 2011 initial public offering, two follow-on equity offerings, and all ten of the company’s acquisitions, including Trulia, StreetEasy and HotPads. Most recently, Philips oversaw the entire Trulia acquisition process, FTC review, and subsequent integration. In her new role as CFO, Philips will oversee the finance, treasury and accounting functions for Zillow Group, and will continue to oversee legal operations and corporate development. Before joining Zillow, Philips served as General Counsel of Hotwire, StubHub, Pure Digital Technologies, and FanSnap.
“I’ve worked closely with Kathleen for over ten years, first at Hotwire where she was general counsel and a member of our senior leadership and now here at Zillow, where she has played an instrumental role in our success,” said Zillow Group CEO Spencer Rascoff. “Kathleen has been at the center of all of Zillow’s key business initiatives for the last five years. She is perfectly positioned to be Zillow Group’s new CFO, and I’m very excited to work with her in this new role.”
With Philips taking over the CFO role, Amy Bohutinsky has been promoted to Chief Operating Officer. Bohutinsky joined Zillow pre-launch in 2005, as one of its earliest employees, and has been a critical force in growing the company’s brand and traffic growth. As Zillow Group’s CMO, Bohutinsky has been responsible for brand strategy for all consumer and business to business brands in the Zillow Group portfolio, as well as growth, marketing and consumer care for the group’s flagship Zillow brand. As COO, Bohutinsky will oversee Zillow Group’s people organization (human resources, recruiting and learning and development), as well as marketing, communications and consumer care. Before joining Zillow, Bohutinsky ran communications for Hotwire.
“Amy has been with Zillow from the beginning and has played a critical role in growing the Zillow brand from launch to where we are today – the leading real estate website in the country,” said Rascoff. “She’s an incredibly valuable member of our executive team, and this promotion recognizes her contributions to the company as an individual and a leader.”
Philips and Bohutinsky will continue to report to Spencer Rascoff, Zillow Group CEO.
Zillow Group
Zillow Group (NASDAQ:Z) houses a portfolio of the largest real estate and home-related brands on mobile and the Web. The company’s brands focus on all stages of the home lifecycle: renting, buying, selling, financing and home improvement. Zillow Group is committed to empowering consumers with unparalleled data, inspiration and knowledge around homes, and connecting them with the right local professionals to help. The Zillow Group portfolio of consumer brands includes real estate and rental marketplaces Zillow ® , Trulia ® , StreetEasy ® and HotPads ® . In addition, Zillow Group works with tens of thousands of real estate agents, lenders and rental professionals, helping maximize business opportunities and connect to millions of consumers. The company operates a number of business brands for real estate, rental and mortgage professionals, including Postlets ® , Mortech ® , Diverse Solutions ® , Market Leader ® and Retsly™. The company is headquartered in Seattle.
Zillow, Postlets, Mortech, Diverse Solutions, StreetEasy, and HotPads are registered trademarks of Zillow, Inc. Retsly is a trademark of Zillow, Inc. Trulia is a registered mark of Trulia, Inc. Market Leader is a registered trademark of Market Leader, Inc.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 that involve risks and uncertainties, including, without limitation, statements regarding our planned management changes. Statements containing words such as “may,” “believe,” “anticipate,” “expect,” “intend,” “plan,” “project,” “will,” or similar expressions constitute forward-looking statements. Differences in actual events from those described in these forward-looking statements may result from actions taken by Zillow Group as well as from risks and uncertainties beyond Zillow Group’s control. For information about factors that could cause actual events to differ from those anticipated in forward-looking statements, please review the “Risk Factors” described in Zillow Group, Inc.’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2015 filed with the Securities and Exchange Commission, or SEC, and in Zillow Group’s other filings with the SEC. Except as may be required by law, Zillow Group does not intend, and undertakes no duty, to update this information to reflect future events or circumstances.