8-K/AOther EventsExhibits & Filings

Cloudflare, Inc. 8-K/A Report, Corporate Update (Apr 21, 2022)

Filed April 21, 2022For Securities:NET

Summary

Cloudflare, Inc. (NET) has filed an amendment to its previous 8-K filing concerning performance-based stock options granted to its CEO, Matthew Prince, and President/COO, Michelle Zatlyn. This amendment, filed on April 20, 2022, clarifies the conditions under which these "Performance Awards" will not be forfeited. Specifically, it revises the stockholder approval requirement for these awards, which were originally granted on December 21, 2021, and are tied to achieving specific stock price milestones and continued leadership. The key change is that the Performance Awards will now require an affirmative vote from a majority of the voting power of Class A and Class B common stock, voting as a single class, excluding shares held by the co-founders, named executive officers, other employees who received similar options, and their affiliates. This vote must be obtained from "Disinterested Stockholders" at a 2022 meeting. If this approval is not secured by December 22, 2022, the awards will be automatically forfeited. The company will provide a proxy statement with detailed information regarding these awards and the upcoming vote.

Key Highlights

  • 1Amendment to previously disclosed performance-based stock options for CEO and President/COO.
  • 2Awards are contingent on achieving stock price milestones and continued leadership.
  • 3New requirement for stockholder approval of the awards by "Disinterested Stockholders".
  • 4Approval requires a majority vote of Class A and Class B common stock, excluding insiders.
  • 5Forfeiture of awards if not approved by December 22, 2022.
  • 6Company will issue a Proxy Statement with further details, urging stockholders to review.
  • 7The filing includes the form of the Amended and Restated Performance Stock Option Agreement.

Frequently Asked Questions

The purpose of this 8-K/A filing is to amend and clarify the terms of performance-based stock options previously granted to Cloudflare's CEO and President/COO. The key change relates to the stockholder approval required to prevent the forfeiture of these awards.

The performance awards will be forfeited if they are not approved by a majority of the voting power of "Disinterested Stockholders" (which excludes the co-founders, named executive officers, and certain other employees and their affiliates) by December 22, 2022. This vote will occur at a company stockholder meeting in 2022.

The voting responsibility lies with the "Disinterested Stockholders." This group includes all shareholders except for the two co-founders (CEO and President/COO), other named executive officers, employees who received similar performance-based options in February 2022, and certain of their affiliates.

If a majority of the voting power held by the Disinterested Stockholders does not approve the Amended Performance Awards by December 22, 2022, the awards will be immediately and automatically forfeited.