| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of
Certain Officers. |
(b) Resignation of President and Chief Operating
Officer
As previously reported on the
Original Report, on May 11, 2023, Zach Katz resigned from his position as President and Chief Operating Officer of the Company, effective
May 31, 2023 (the “Separation Date”). In connection with Mr. Katz’s resignation, the Company and Mr. Katz entered into
a Separation and Release of Claims Agreement, dated as of May 31, 2023 (the “Separation Agreement”), The Separation Agreement
provides that Mr. Katz will receive, subject to his execution of a general release of claims against the Company, (i) a lump sum severance
payment in an amount equal to his annual base salary, (ii) payment of COBRA health insurance premiums for continuation of the coverage
in effect on the Separation Date for Mr. Katz and his spouse and dependents for the lesser of twelve (12) months or the maximum COBRA
continuation period, and (iii) full vesting of the 813,223 shares of restricted common stock of the Company granted to Mr. Katz on May
10, 2022, to the extent not already vested, subject to tax withholding.
The Separation Agreement also
includes a release of claims, confidentiality, non-solicitation, non-disparagement and other provisions customary for an agreement of
this type.
The foregoing description of the
Separation Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Separation
Agreement. A copy of the Separation Agreement is expected to be filed as an exhibit to the Company’s Quarterly Report on Form 10-Q
for the period ending June 30, 2023.
(c) Appointment of President and Chief Operating
Officer
As previously reported on the
Original Report, on May 11, 2023, the Company appointed Erik Anderson to the role of President of FaZe Clan, Inc., effective May 31, 2023.
In connection with Mr. Anderson’s promotion, he received an award of 450,000 performance shares, each representing a contingent
right to receive one share of the Company’s common stock, 300,000 of which will vest upon the Company’s common stock achieving
a specified price per share and the remaining 150,000 of which will be earned upon the Company’s common stock achieving a specified
price per share and subject to vesting in twelve equal monthly installments from the date of issuance.
Also as previously reported on the Original Report,
on May 11, 2023, the Company appointed Christoph Pachler, the current Chief Financial Officer of the Company, to the additional role of
Chief Operating Officer of the Company, effective May 31, 2023.
On May 31, 2023, in connection with Mr. Pachler’s
appointment to his additional role, the Company and Mr. Pachler agreed to the following compensation terms, which will be reflected in
an amendment to Mr. Pachler’s employment agreement with the Company (the “Amended Employment Agreement”):
| · | an increase in his annual base salary to $440,000 from $375,000, effective May 31, 2023; |
| · | a guaranteed cash bonus for 2023 equal to 100% of his base salary subject to Mr. Pachler not resigning prior to December 31, 2023; |
| · | the terms of the restricted stock award granted to Mr. Pachler on November 21, 2022 for 520,000 shares were amended to provide that
173,328 shares fully vested on May 31, 2023, and the remaining 346,672 shares vest in equal monthly installments starting from June 30,
2023 through September 30, 2024 (previously, 186,667 shares would vest in two equal installments on September 30, 2023 and 2024, and the
remaining shares were subject to performance-based vesting); |
| · | an additional award of 800,000 restricted stock units that will vest in equal monthly installments through December 31, 2024; and |
| · | an award of 450,000 performance shares, each representing a contingent right to receive one share of the Company’s common stock,
300,000 of which will vest upon the Company’s common stock achieving a specified price per share and the remaining 150,000 of which
will be earned upon the Company’s common stock achieving a specified price per share and subject to vesting in twelve equal monthly
installments from the date of issuance. |
The foregoing description of the
Amended Employment Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Amended
Employment Agreement. A copy of the Amended Employment Agreement is expected to be filed as an exhibit to the Company’s Quarterly
Report on Form 10-Q for the period ending June 30, 2023.