Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
As previously announced, Terminix Global Holdings, Inc. (the "Company") entered
into a Merger Agreement with Rentokil Initial plc and its affiliates in December
2021, and the transaction is expected to close in the second half of 2022. In
conjunction with the pending merger, the parties have agreed that the Company
may provide up to $20 million of cash retention awards (the "Retention Pool") to
Terminix teammates. The retention awards are designed to retain and incentivize
the Terminix team as it executes the 2022 operating plan, achieves the
consummation of the merger and assists with the integration of the combined
company after closing of the transaction. Half of the Retention Pool has been
allocated specifically to customer-facing, field operations teammates, and the
remainder has been allocated to key back-office teammates, including to the
named executive officers detailed below.
On February 17, 2022, the Company's Compensation Committee approved retention
awards from the Retention Pool pursuant to retention agreements with certain
executive officers of the Company, including our named executive officers Brett
T. Ponton, Chief Executive Officer, Robert J. Riesbeck, Executive Vice President
and Chief Financial Officer, and Dion Persson, Senior Vice President, Strategy
and Mergers and Acquisitions. The retention agreement for Mr. Ponton provides
for a $2.5 million retention award, 40% of which is payable upon consummation of
the merger transaction and 60% of which is payable on the later of (i) three
months from the date of consummation of the merger transaction or (ii) August
21, 2023. If the merger transaction does not close, 100% of Mr. Ponton's
retention award would be payable on February 21, 2024. The retention agreements
for Messrs. Riesbeck and Persson each provide for a $350,000 retention award,
50% of which is payable upon consummation of the merger transaction and 50% of
which is payable on the later of (i) three months after consummation of the
merger transaction or (ii) August 21, 2023. If the merger transaction does not
close, 100% of the retention awards for Messrs. Riesbeck and Persson would be
payable on August 21, 2023; however, if the Merger Agreement is terminated in
accordance with its terms prior to August 21, 2023, 50% of the retention award
to Messrs. Riesbeck and Persson would be paid within five business days of such
termination and 50% would be payable on August 21, 2023. Each of the retention
agreements provides that if the named executive officer's employment is
terminated by the Company without cause after consummation of the merger
transaction, the unpaid portion of the retention award will be paid within five
business days following the date of termination.
The foregoing summary of the retention agreements with our named executive
officers does not purport to be complete and is qualified in its entirety by
reference to the retention agreements, which the Company expects to file as an
exhibit to its Quarterly Report on Form 10-Q for the quarter ended March 31,
2022.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit Description
104 Cover Page Interactive Data File (Formatted as inline XBRL and
contained in Exhibit 101)
Additional Information About The Proposed Transaction And Where To Find It
In connection with the proposed transaction between Rentokil and Terminix,
Rentokil will file with the U.S. Securities and Exchange Commission (the "SEC")
a registration statement on Form F-4, which will include a proxy statement of
Terminix that also constitutes a prospectus of Rentokil. Each of Rentokil and
Terminix will also file other relevant documents in connection with the proposed
transaction. The definitive proxy statement/prospectus will be sent to the
shareholders of Terminix. Rentokil will also file a shareholder proxy circular
in connection with the proposed transaction with applicable securities
regulators in the United Kingdom and the shareholder proxy circular will be sent
to Rentokil's shareholders. This Current Report on Form 8-K is not a substitute
for any registration statement, proxy statement/prospectus or other documents
Rentokil and/or Terminix may file with the SEC in connection with the proposed
transaction. BEFORE MAKING ANY VOTING OR INVESTMENT DECISIONS, INVESTORS,
STOCKHOLDERS AND SHAREHOLDERS OF TERMINIX AND RENTOKIL ARE URGED TO READ
CAREFULLY AND IN THEIR ENTIRETY THE PROXY STATEMENT/PROSPECTUS AND SHAREHOLDER
PROXY CIRCULAR, AS APPLICABLE, AND ANY OTHER RELEVANT DOCUMENTS THAT ARE FILED
OR WILL BE FILED WITH THE SEC OR APPLICABLE SECURITIES REGULATORS IN THE UNITED
KINGDOM, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, IN
CONNECTION WITH THE PROPOSED TRANSACTION WHEN THEY BECOME AVAILABLE, AS THEY
CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT TERMINIX, RENTOKIL, THE
PROPOSED TRANSACTION AND RELATED MATTERS. The registration statement and proxy
statement/prospectus and other documents filed by Rentokil and Terminix with the
SEC, when filed, will be available free of charge at the SEC's website at
www.sec.gov. In addition, investors and shareholders will be able to obtain free
copies of the proxy statement/prospectus and other documents filed with the SEC
by Terminix online at investors.terminix.com, upon written request delivered to
Terminix at 150 Peabody Pl., Memphis, TN 38103, USA, Attention: Corporate
Secretary, or by calling Terminix's Corporate Secretary's Office by telephone at
+1 901-597-1400 or by email at deidre.richardson@terminix.com, and will be able
to obtain free copies of the registration statement, proxy statement/prospectus,
shareholder proxy circular and other documents which will be filed with the SEC
and applicable securities regulators in the United Kingdom by Rentokil online at
https://www.rentokil-initial.com, upon written request delivered to Rentokil at
Compass House, Manor Royal, Crawley, West Sussex, RH10 9PY, England, Attention:
Katharine Rycroft, or by calling Rentokil by telephone at +44 (0) 7811 270734 or
by email at katharine.rycroft@rentokil-initial.com.
This Current Report on Form 8-K is for informational purposes only and is not
intended to, and shall not, constitute an offer to sell or buy or the
solicitation of an offer to sell or buy any securities, nor shall there be any
sale of securities in any jurisdiction in which such offer, solicitation or sale
would be unlawful prior to appropriate registration or qualification under the
securities laws of any such jurisdiction. No offering of securities shall be
made except by means of a prospectus meeting the requirements of Section 10 of
the U.S. Securities Act of 1933, as amended.
Participants in the Solicitation of Proxies
This Current Report on Form 8-K is not a solicitation of proxies in connection
with the proposed transaction. However, under SEC rules, Terminix, Rentokil, and
certain of their respective directors, executive officers and other members of
the management and employees may be deemed to be participants in the
solicitation of proxies in connection with the proposed transaction. Information
about Terminix's directors and executive officers may be found on its website at
corporate.terminix.com/responsibility/corporate-governance and in its 2020
Annual Report on Form 10-K filed with the SEC on February 26, 2021, available at
investors.terminix.com and www.sec.gov. Information about Rentokil's directors
and executive officers may be found on its website at
https://www.rentokil-initial.com and in its 2020 Annual Report filed with
applicable securities regulators in the United Kingdom on March 31, 2021,
available on its website at https://www.rentokil-initial.com. These documents
can be obtained free of charge from the sources indicated above. Additional
information regarding the interests of such potential participants in the
solicitation of proxies in connection with the proposed transaction will be
included in the proxy statement/prospectus and shareholder proxy circular and
other relevant materials filed with the SEC and applicable securities regulators
in the United Kingdom when they become available.
Information Regarding Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements as that term
is defined in Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended by the Private
Securities Litigation Reform Act of 1995. Forward-looking statements can
sometimes be identified by the use of forward-looking terms such as "believes,"
"expects," "may," "will," "shall," "should," "would," "could," "potential,"
"seeks," "aims," "projects," "predicts," "is optimistic," "intends," "plans,"
"estimates," "targets," "anticipates," "continues" or other comparable terms or
negatives of these terms, but not all forward-looking statements include such
identifying words. Forward-looking statements are based upon current plans,
estimates and expectations that are subject to risks, uncertainties and
assumptions. Should one or more of these risks or uncertainties materialize, or
should underlying assumptions prove incorrect, actual results may vary
materially from those indicated or anticipated by such forward-looking
statements. We can give no assurance that such plans, estimates or expectations
will be achieved and therefore, actual results may differ materially from any
plans, estimates or expectations in such forward-looking statements. Important
factors that could cause actual results to differ materially from such plans,
estimates or expectations include: a condition to the closing of the proposed
transaction may not be satisfied; the occurrence of any event that can give rise
to termination of the proposed transaction; a regulatory approval that may be
required for the proposed transaction is delayed, is not obtained or is obtained
subject to conditions that are not anticipated; Rentokil is unable to achieve
the synergies and value creation contemplated by the proposed transaction;
Rentokil is unable to promptly and effectively integrate Terminix's businesses;
management's time and attention is diverted on transaction related issues;
disruption from the proposed transaction makes it more difficult to maintain
business, contractual and operational relationships; the credit ratings of
Rentokil declines following the proposed transaction; legal proceedings are
instituted against Terminix or Rentokil; Terminix or Rentokil is unable to
retain or hire key personnel; the announcement or the consummation of the
proposed acquisition has a negative effect on the market price of the capital
stock of Terminix or Rentokil or on Terminix's or Rentokil's operating results;
evolving legal, regulatory and tax regimes; changes in economic, financial,
political and regulatory conditions, in the United Kingdom, the United States
and elsewhere, and other factors that contribute to uncertainty and volatility,
natural and man-made disasters, civil unrest, pandemics (e.g., the coronavirus
(COVID-19) pandemic (the "COVID-19 pandemic")), geopolitical uncertainty, and
conditions that may result from legislative, regulatory, trade and policy
changes associated with the current or subsequent U.S. or U.K. administration;
the ability of Rentokil or Terminix to successfully recover from a disaster or
other business continuity problem due to a hurricane, flood, earthquake,
terrorist attack, war, pandemic, security breach, cyber-attack, power loss,
telecommunications failure or other natural or man-made event, including the
ability to function remotely during long-term disruptions such as the COVID-19
pandemic; the impact of public health crises, such as pandemics (including the
COVID-19 pandemic) and epidemics and any related company or governmental
policies and actions to protect the health and safety of individuals or
governmental policies or actions to maintain the functioning of national or
global economies and markets, including any quarantine, "shelter in place,"
"stay at home," workforce reduction, social distancing, shut down or similar
actions and policies; actions by third parties, including government agencies;
the risk that disruptions from the proposed transaction will harm Rentokil's or
Terminix's business, including current plans and operations; certain
restrictions during the pendency of the acquisition that may impact Rentokil's
or Terminix's ability to pursue certain business opportunities or strategic
transactions; Rentokil's or Terminix's ability to meet expectations regarding
the accounting and tax treatments of the proposed transaction; the risks and
uncertainties discussed in the "Risks and Uncertainties" section in Rentokil's
reports available on the National Storage Mechanism at morningstar.co.uk/uk/NSM
and on its website at https://www.rentokil-initial.com; and the risks and
uncertainties discussed in the "Risk Factors" and "Information Regarding
Forward-Looking Statements" sections in Terminix's reports filed with the SEC.
These risks, as well as other risks associated with the proposed transaction,
will be more fully discussed in the proxy statement/prospectus and shareholder
proxy circular. While the list of factors presented here is, and the list of
factors to be presented in proxy statement/prospectus and shareholder proxy
circular will be, considered representative, no such list should be considered
to be a complete statement of all potential risks and uncertainties. Unlisted
factors may present significant additional obstacles to the realization of
forward-looking statements. We caution you not to place undue reliance on any of
these forward-looking statements as they are not guarantees of future
performance or outcomes and that actual performance and outcomes, including,
without limitation, our actual results of operations, financial condition and
liquidity, and the development of new markets or market segments in which we
operate, may differ materially from those made in or suggested by the
forward-looking statements contained in this Current Report on Form 8-K. Neither
Rentokil nor Terminix assumes any obligation to update or revise the information
contained herein, which speaks only as of the date hereof.
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