Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
Appointment of New Director
On March 23, 2022, the board of directors (the "Board") of Robinhood Markets,
Inc. (the "Company") appointed Meyer "Micky" Malka to the Board, effective
immediately. The Board also appointed him to serve on the Safety, Regulatory and
Risk Committee, commencing concurrently with his Board service. Mr. Malka is an
independent Class II director, with an initial term expiring at Robinhood's 2023
annual meeting of stockholders. In connection with Mr. Malka's appointment, the
Board increased the number of directors on the Board from eight to nine.
Mr. Malka will participate in Robinhood's Non-Employee Director Compensation
Program as described under "Director Compensation" in the Company's final
initial public offering ("IPO") prospectus, dated July 28, 2021, which was filed
with the Securities and Exchange Commission ("SEC") on July 30, 2021. In
addition, the Company has entered into an indemnification agreement with
Mr. Malka.
There are no arrangements or understandings between Mr. Malka and any other
persons pursuant to which he was selected as a director and he has no family
relationships with any of Robinhood's directors or executive officers. Mr. Malka
is the founder and managing director of Ribbit Capital ("Ribbit"), a venture
capital firm. Entities associated with Ribbit beneficially owned approximately
7.0% of the Company's Class A shares of common stock and held approximately 2.6%
of the Company's voting power, in each case as of December 31, 2021, inclusive
of their warrants, and based on the Schedule 13G filed by Ribbit on February 14,
2022.
In February 2021, entities affiliated with Ribbit purchased approximately
$501.6 million aggregate principal amount of the Company's Tranche I convertible
notes (the "Notes"), which upon the closing of the IPO automatically converted
into approximately 19.4 million shares of the Company's Class A common stock at
a conversion price of $26.60. Concurrently with issuance of the Notes, the
Company granted a ten-year warrant to Ribbit to purchase equity securities with
an aggregate exercise price equal to 15% of the amount invested by Ribbit in the
Notes. The warrants became exercisable in connection with the closing of the IPO
for approximately 2.8 million shares of Class A common stock at an exercise
price of $26.60 per share. Ribbit continues to hold these warrants.
In February 2021 in connection with the Notes and warrant financings, the
Company entered into a Tranche I convertible note and warrant purchase agreement
(the "Tranche I Purchase Agreement"). Pursuant to the Tranche I Purchase
Agreement, holders of the Notes, including entities affiliated with Ribbit, had
the right to request that the Company file a registration statement, and/or
request that the common shares issued upon conversion of the Notes be covered by
a registration statement that the Company was otherwise filing, in each case
subject to certain exceptions. In addition, in connection with the IPO, the
purchasers of the Company's Notes and warrants, including entities affiliated
with Ribbit, entered into market standoff agreements with the Company for the
benefit of the underwriters of the IPO, pursuant to which such purchasers
entered into lockup agreements in connection with the IPO, all of which expired
on December 1, 2021.
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The Company was a party to a Voting Agreement, most recently amended and
restated in August 2020, pursuant to which many of its investors, including
entities affiliated with Ribbit, agreed to the manner in which they would vote
their shares on various matters, including the election of directors. This
Voting Agreement terminated upon the completion of the IPO and no longer governs
any aspect of the election or designation of members of the Board or the voting
or the Company's capital stock.
In August 2020, the Company also became party to an Amended and Restated
Investors' Rights Agreement with certain holders of its capital stock, including
entities affiliated with Ribbit, which provides, among other things, that
certain holders of the Company's capital stock and warrants have the right to
request that the Company file a registration statement, and/or request that
their shares be covered by a registration statement that the Company is
otherwise filing, subject to certain exceptions. Also under the Investors'
Rights Agreement, such holders entered into market standoff agreements with the
Company for the benefit of the IPO underwriters, pursuant to which such holders
have entered into lockup agreements in connection with the IPO, all of which
expired on December 1, 2021. All rights, other than the registration rights,
under the Investors' Rights Agreement terminated in connection with the IPO. The
remaining registration rights under the Investors' Rights Agreement terminated
on October 27, 2021.
In August 2020, Vladimir Tenev (the Company's Chief Executive Officer and
co-founder), Baiju Bhatt (the Company's Chief Creative Officer and co-founder)
and certain of their affiliates and certain of the Company's other stockholders,
including entities affiliated with Ribbit, entered into a Right of First Refusal
and Co-Sale Agreement which provided the Company or its assignees with a right
of first refusal to purchase shares of the Company's common stock which certain
of its stockholders, including Mr. Tenev and Mr. Bhatt, proposed to sell to
other parties. The Right of First Refusal and Co-Sale Agreement also provided
the investors party thereto with rights of first refusal and co-sale relating to
shares of the Company's common stock held and proposed to be transferred by
either of Mr. Tenev or Mr. Bhatt or certain of their respective affiliates or
permitted transferees. The Right of First Refusal and Co-Sale Agreement
terminated in connection with the IPO.
Item 7.01 Regulation FD Disclosure.
On March 23, 2022, Robinhood published a blog post announcing Mr. Malka's
appointment to the Board. A copy of that blog post is furnished as Exhibit 99.1
to this Current Report on Form 8-K.
The Company intends to use its blog, Under the Hood, as a means of disclosing
material information to the public in a broad, non-exclusionary manner for
purposes of the SEC's Regulation Fair Disclosure (Reg. FD). Under the Hood can
be accessed at https://blog.robinhood.com/ and investors should routinely
monitor that website, in addition to the Company's press releases, SEC filings,
and public conference calls and webcasts, as information posted on the Company's
blog could be deemed to be material information.
The information furnished with this Item 7.01, including Exhibit 99.1, shall not
be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities
of that section, nor shall it be deemed incorporated by reference into any other
filing under the Securities Act of 1933, as amended, or the Exchange Act, except
as expressly set forth by specific reference in such a filing.
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Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit
Number Description
99.1 Blog post dated March 23, 2022
104 Cover Page Interactive Data File (the cover page XBRL tags are
embedded within the Inline XBRL document)
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