01—Abstract
Summary
Summary of the 8-K filed January 23, 2024. Cited figures are marked; the original filing is the authoritative source.
On January 21, 2024, TKO Group Holdings, Inc. entered into a Term Employment Agreement with Mark Shapiro, its President and Chief Operating Officer, superseding his prior agreement dated September 12, 2023.
The agreement runs from January 1, 2024 through December 31, 2027, and Mr. Shapiro will report to Ariel Emanuel, Chief Executive Officer of TKO. The filing states that he may continue to provide services in his roles at Endeavor Group Holdings, Inc., Endeavor Operating Company, LLC and their subsidiaries. Compensation includes an annual base salary of $4,000,000,a a $4,000,000 cash bonus for fiscal year 2023, and a target annual bonus of $6,000,000 for later years, based on TKO and/or individual performance metrics.
The agreement also provides a one-time award of 252,749 restricted stock units vesting in four equal annual installments on December 31 of 2024 through 2027, plus annual equity awards with a target value of $10,000,000b beginning with fiscal year 2024 grants. The agreement includes severance and change-of-control protections. Termination without Cause or for Good Reason triggers continued base salary, target bonus payments and accelerated vesting of time-based awards through the later of December 31, 2027 or the second anniversary of termination.
Unvested service-based equity awards accelerate upon a Change of Control. Severance is conditioned on execution of a release of claims.
02—Key points
Key Highlights
- Mark Shapiro, President and COO, signed a new Term Employment Agreement dated January 21, 2024, superseding his September 12, 2023 agreement.
- The term runs from January 1, 2024 through December 31, 2027, and he reports to CEO Ariel Emanuel.
- Annual base salary is $4,000,000, with a $4,000,000 cash bonus for fiscal year 2023 and a target annual bonus of $6,000,000 thereafter.
- A one-time equity award of 252,749 RSUs vests in four equal installments on December 31, 2024, 2025, 2026 and 2027, subject to continued employment.
- Annual equity awards have a target amount of $10,000,000, beginning with fiscal year 2024 awards granted in fiscal year 2025.
- Severance upon termination without Cause, for Good Reason, or upon an Employer Non-Renewal includes continued base salary, target bonuses and accelerated vesting, conditioned on a release of claims.
- Service-based equity awards accelerate in full upon a Change of Control, subject to continued service through its consummation.
03—Questions
Frequently Asked Questions
What is the term of Mark Shapiro's new employment agreement?
The agreement is effective from January 1, 2024 and expires on December 31, 2027.
What compensation is Mark Shapiro entitled to under the agreement?
He receives an annual base salary of $4,000,000, a $4,000,000 cash bonus for fiscal year 2023, a target annual bonus of $6,000,000 for later years, a one-time award of 252,749 RSUs, and annual equity awards with a target amount of $10,000,000.
How does the agreement treat severance if Mr. Shapiro is terminated without Cause?
Upon termination without Cause or resignation for Good Reason, he receives continued base salary through the later of December 31, 2027 or the second anniversary of termination, target bonus payments for the same period, and accelerated vesting of time-based equity awards, subject to a release of claims.
Does Mr. Shapiro's agreement with TKO affect his roles at Endeavor?
The agreement states that he may continue to provide services in his roles and positions at Endeavor Group Holdings, Inc., Endeavor Operating Company, LLC and their subsidiaries, including as those roles may be modified.
What happens to unvested equity if there is a Change of Control?
Unvested portions of the 2024 Equity Award and Annual Equity Awards that vest solely based on continued service accelerate in full upon a Change of Control, subject to continued service through its consummation. Performance-based awards may also accelerate if the Governing Body determines they cannot be equitably adjusted.
04—Continue