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): March 21, 2022
UNITY SOFTWARE INC.
(Exact name of registrant as specified in its charter)
| Delaware | 001-39497 | 27-0334803 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
30 3rd Street
San Francisco, California 94103-3104
(Address, including zip code, of principal executive offices)
(415) 539-3162
(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)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
| Common stock, $0.000005 par value per share | U | The New York Stock Exchange |
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 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On March 21, 2022, the board of directors (“Board”) of Unity Software Inc. (“Unity”), set the authorized number of directors composing the board at ten and appointed Michelle K. Lee to fill the vacancy, effective immediately. Ms. Lee was appointed as a Class I director for a term expiring at Unity’s 2024 annual meeting of stockholders. Ms. Lee was also appointed to the Audit Committee of the Board, effective immediately, to replace Barry Schuler, who ceased serving on the Audit Committee effective upon Ms. Lee’s appointment. Mr. Schuler will remain Chair of the Compensation Committee.
Michelle K. Lee has served as a member of our Board since March 2022. From 2019 until 2021, Ms. Lee was the Vice President of the Machine Learning Solutions Lab at Amazon Web Services, a subsidiary of Amazon.com, Inc., an e-commerce company. From 2017 to 2018, Ms. Lee held the appointment of the Herman Phleger Visiting Professor of Law at Stanford University. Prior to that, from 2018 to 2019, Ms. Lee served on the board of directors for Alarm.com Holdings, Inc., a provider cloud-based services for home automation and monitoring services. Before that, from 2012 until 2017, Ms. Lee served in various roles at the United States Patent and Trademark Office (“USPTO”), including most recently as the Under Secretary of Commerce for Intellectual Property and Director of the USPTO. Prior to her time in public service, from 2003 until 2012, Ms. Lee held various roles at Google, Inc, an internet company, including most recently Deputy General Counsel. Earlier in her career, Ms. Lee was a partner at Fenwick & West, LLP, a law firm. Ms. Lee holds a S.B. in electrical engineering and a S.M. in electrical engineering and computer science from the Massachusetts Institute of Technology, and a J.D. from the Stanford University School of Law. Ms. Lee is also a member of the Massachusetts Institute of Technology (“MIT”) Corporation, MIT’s board of trustees.
In connection with her appointment, Ms. Lee has entered into Unity’s standard from of indemnification agreement, the form of which is incorporated by reference as exhibit 10.5 to Unity’s Annual Report on Form 10-K for the year ending December 31, 2021.
Ms. Lee will be compensated as a member of the Board under the terms of Unity’s Amended and Restated Non-Employee Director Compensation Policy, which is described under the caption “Non-Employee Director Compensation” in Unity’s proxy statement filed with the Securities and Exchange Commission on April 28, 2021, and which was amended and restated in December 2021 and March 2022 and is filed herewith (as amended and restated, the “Policy”). The changes to the Policy provide that (i) non-employee directors can elect to receive up to 100% of the value of their committee retainer grant in the form of a cash payment (the “Retainer Cash Election”), (ii) reduce the target value of the annual grant from $250,000 to $235,000, and (iii) provide for a new $50,000 annual cash retainer grant for all directors at the close of business on the date of each annual meeting of stockholders, which non-employee directors may elect to receive instead as an RSU award with a target value of $50,000. The annual cash retainer grant (or RSU award elected in lieu thereof, if applicable) will fully vest on the earlier of (1) the first anniversary of the applicable grant date and (2) the date of the first annual meeting of stockholders following the applicable grant date, subject to the non-employee director’s continuous service through the vesting date. Pursuant to the Policy, upon her appointment to the Board, Ms. Lee was awarded 4,248 restricted stock units, which will vest in a series of successive equal quarterly installments over the three-year period measured from the grant date, subject to Ms. Lee’s continuous service through each vesting date.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit |
Description of Exhibit | |
| 99.1 | Amended and Restated Non-Employee Director Compensation Policy | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| UNITY SOFTWARE INC. | ||||||
| Date: March 22, 2022 | By: | /s/ John Riccitiello | ||||
| John Riccitiello | ||||||
| Chief Executive Officer | ||||||
Exhibit 99.1
UNITY SOFTWARE INC.
NON-EMPLOYEE DIRECTOR COMPENSATION POLICY
ADOPTED: August 14, 2020
AMENDED AND RESTATED: DECEMBER 2, 2021
AMENDED AND RESTATED: MARCH 4, 2022
Each member of the Board of Directors (the “Board”) of Unity Software Inc. (the “Company”) who is a non-employee director of the Company (each such member, a “Non-Employee Director”) will be eligible to receive the compensation described in this Non-Employee Director Compensation Policy (the “Policy”) for his or her Board service. Unless otherwise defined herein, capitalized terms used in this Policy will have the meaning given to such terms in the Company’s 2020 Equity Incentive Plan (the “Plan”) or any successor equity incentive plan.
The Policy became effective on September 17, 2020 (the “Effective Date”). The Policy may be amended at any time in the sole discretion of the Board.
Following the Effective Date, each Non-Employee Director will be eligible to receive the applicable compensation set forth below. Any equity compensation will be granted under the Plan or any successor equity incentive plan. Grants made in connection with the initial public offering were not covered by this Policy.
(a) Retainer Grant and Cash Election.
(i) Retainer Grant. Without any further action by the Board, at the close of business on the date of each annual meeting of the stockholders of the Company following the Effective Date (each, an “Annual Meeting”), each person who is then a Non-Employee Director will automatically be granted an RSU Award covering a number of shares of Common Stock equal to (A) the Total Retainer (as defined below) minus such Non-Employee Director’s Retainer Cash Election (as defined below), if any, divided by (B) the closing sales price per share of the Common Stock on the date of the applicable Annual Meeting, rounded down to the nearest whole share (each, a “Retainer Grant”). Each Retainer Grant will fully vest and become payable on the earlier of (1) the first anniversary of the applicable grant date and (2) the date of the first Annual Meeting following the applicable grant date, subject to the Non-Employee Director’s Continuous Service through the vesting date.
The “Total Retainer” shall mean the sum of the following retainer fees, as applicable with respect to such Non-Employee Director, measured as of the date of the Retainer Grant:
| Committee Chair: |
$ | 25,000 | ||
| Committee Member: |
$ | 10,000 | ||
| Lead Independent Director: |
$ | 25,000 |
(ii) Cash Election. Prior to the first day of the calendar year in which the Retainer Grant is to be made (or, if later, in the case of a New Director, prior to the New Director’s commencement of service), each Non-Employee Director may elect, using such election form as may be provided by the Company, to receive up to 100% of the value of the Retainer Grant in the form of a cash payment (any such amount that is elected, the “Retainer Cash Election”). The Retainer Cash Election shall be paid within ten (10) business days following the vesting date of the Retainer Grant, subject to the Non-Employee Director’s Continuous Service through such vesting date. If no election is made by the relevant deadline, then no Retainer Cash Election shall be subtracted from the value of the Retainer Grant.
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(b) Initial Grant. Without any further action by the Board, each person who, after the Effective Date is elected or appointed for the first time to be a Non-Employee Director (a “New Director”) will automatically, upon the date of their initial election or appointment to be a Non-Employee Director (or, if such date is not a business day, the first business day thereafter), be granted an RSU Award covering a number of shares of Common Stock equal to (A) $400,000 divided by (B) the closing sales price per share of the Company’s Common Stock on the applicable grant date, rounded down to the nearest whole share (each, an “Initial Grant”). Each Initial Grant will vest and become payable in a series of successive equal quarterly installments over the three-year period measured from the applicable grant date, subject to the Non-Employee Director’s Continuous Service through each applicable vesting date.
(c) Annual Grant and Cash Election.
(i) Annual Grant. Without any further action by the Board, at the close of business on the date of each Annual Meeting, each person who is then a Non-Employee Director will automatically be granted an RSU Award covering a number of shares of Common Stock equal to (A) $235,000 minus such Non-Employee Director’s Annual Cash Election (as defined below), if any, divided by (B) the closing sales price per share of the Company’s Common Stock on the date of the applicable Annual Meeting (each, an “Annual Grant”). Each Annual Grant will fully vest and become payable on the earlier of (1) the first anniversary of the applicable grant date and (2) the date of the first Annual Meeting following the applicable grant date, subject to the Non-Employee Director’s Continuous Service through the vesting date.
(ii) Cash Election. Prior to the first day of the calendar year in which the Annual Grant is to be made (or, if later, in the case of a New Director, prior to the New Director’s commencement of service), each Non-Employee Director may elect, using such election form as may be provided by the Company, to receive up to $50,000 of the value of the Annual Grant in the form of a cash payment (any such amount that is elected, the “Annual Cash Election”). The Annual Cash Election shall be paid within ten (10) business days following the vesting date of the Annual Grant, subject to the Non-Employee Director’s Continuous Service through such vesting date. If no election is made by the relevant deadline, then no Annual Cash Election shall be subtracted from the value of the Annual Grant.
(d) Annual Cash Retainer and RSU Election.
(i) Annual Cash Retainer. Subject to Section (d)(ii) below, at the close of business on the date of each Annual Meeting, each person who is then a Non-Employee Director will automatically be granted a cash award of $50,000 (“Annual Cash Retainer”). Each Annual Cash Retainer will fully vest on the earlier of (1) the first anniversary of the applicable grant date and (2) the date of the first Annual Meeting following the applicable grant date, subject to the Non-Employee Director’s Continuous Service through the vesting date. The Annual Cash Retainer shall be paid within ten (10) business days following its vesting date.
(ii) RSU Election. Prior to the first day of the calendar year in which the Annual Cash Retainer is to be made (or, if later, in the case of a New Director, prior to the New Director’s commencement of service and at least one three-month quarter prior to the Annual Meeting), each Non-Employee Director may elect, using such election form as may be provided by the Company, to instead receive such amount as an RSU Award to be granted without further action by the Board at the close of business on the date of the applicable Annual Meeting and covering a number of shares of Common Stock equal to (A) $50,000 divided by (B) the closing sales price per share of the Company’s Common Stock on the date of such Annual Meeting (the “RSU Election Grant”). Each RSU Election Grant will fully vest and become payable on the earlier of (1) the first anniversary of the applicable grant date and (2) the date of the first Annual Meeting following the applicable grant date, subject to the Non-Employee Director’s Continuous Service through the vesting date. If no election is made by the relevant deadline, then no RSU Election Grant shall be made, unless otherwise approved by the Board.
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(e) Change in Control. Notwithstanding the foregoing, for each Non-Employee Director who remains in Continuous Service with the Company until immediately prior to the closing of a Change in Control, the shares subject to their then-outstanding equity awards that were granted pursuant to the Policy (and any other then-outstanding Company equity awards then held by such Non-Employee Director), and any Retainer Cash Election or Annual Cash Election elected in lieu of a portion of a Retainer Grant or an Annual Grant, will become fully vested and payable immediately prior to the closing of such Change in Control.
(f) Remaining Terms. The remaining terms and conditions of each RSU Award will be as set forth in the Plan and the Company’s standard RSU Award Grant Notice and RSU Award Agreement, in the form adopted from time to time by the Board.
2. Vesting in the Event of Death.
Notwithstanding anything to the contrary herein, if a Non-Employee Director’s Continuous Service terminates because of their death (i) within the first year of Continuous Service, then 50% of any RSU Award held by the Non-Employee Director shall vest and become payable effective as of immediately prior to the effective time of such termination or (ii) on or after the first year of their Continuous Service, then 100% of any RSU Award held by the Non-Employee Director shall vest and become payable effective as of immediately prior to the effective time of such termination. If the Non-Employee Director elected a Retainer Cash Election or Annual Cash Election and their Continuous Service terminates because of their death (i) within the first year of Continuous Service, then 50% of the Retainer Cash Election and/or Annual Cash Election, as applicable, shall be paid to their legal representative within ten (10) business days of the effective time of termination or (ii) on or after the first year of their Continuous Service, then 100% of the Retainer Cash Election and/or Annual Cash Election, as applicable, shall be paid to their legal representative within ten (10) business days of the effective time of termination.
3. Non-Employee Director Compensation Limit
Notwithstanding anything herein to the contrary, the cash compensation and equity compensation that each Non-Employee Director is eligible to receive under this Policy shall be subject to the limits set forth in Section 3(d) of the Plan.
4. Ability to Decline Compensation
A Non-Employee Director may decline all or any portion of their compensation under the Policy by giving notice to the Company prior to the date cash is to be paid or equity awards are to be granted, as the case may be.
5. Expenses
The Company will reimburse each Non-Employee Director for ordinary, necessary and reasonable out-of-pocket travel expenses to cover in-person attendance at and participation in Board and committee meetings; provided, that the Non-Employee Director timely submits to the Company appropriate documentation substantiating such expenses in accordance with the Company’s travel and expense policy, as in effect from time to time.
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