Subsequent Events

12 Months Ended

Dec. 31, 2021

Subsequent Events.

Subsequent Events

20.   Subsequent Events

(a) On February 28, 2022, the Company entered into a definitive agreement (the “RWS Agreement”) to acquire certain businesses (the “Acquired RWS Businesses”) of RWS, Inc. (“RWS”) and its affiliates relating to the sale of home service plans and provision of software and services to home inspectors, through the acquisition of 100% of the equity interests of certain subsidiaries and sister companies of RWS. The aggregate consideration for the Acquired RWS Businesses will be approximately $33.0 million, comprised of cash and shares of the Company’s common stock. The sellers in the RWS Transaction will also be entitled to contingent consideration

based on performance of certain product lines during the 54 months after the closing date. The portions of the RWS Acquired Businesses involving warranty operations in each of California and Florida are subject to regulatory approval, and as such a portion of the purchase price will be deferred until approval is received for California and for Florida. If regulatory approval is not received for California and/or Florida than the applicable portion of deferred purchase price will not be paid. The remainder of the consideration payable to the sellers pursuant to the RWS Agreement (other than pursuant to the contingent consideration and the deferred closing described earlier in this paragraph) will be paid at the initial closing (the “RWS Closing”) of the transactions contemplated by the RWS Agreement. The RWS Closing is subject to customary closing conditions and is expected to occur early in the second quarter of 2022.

(b) In February 2022, the Compensation Committee granted 2021 annual equity awards to the CEO with an aggregate grant value of $5.0 million, consisting of (i) 883,740 performance-based restricted stock units (“CEO PRSUs”) with a grant value of $3.75 million and (ii) 144,844 time-based RSUs (“CEO RSUs”) with a grant date value of $1.25 million. In addition, the Compensation Committee granted a Together We Win RSU award to the CEO (“CEO TWW RSUs”), consisting of 695,249 RSUs with a grant value of $6.0 million. CEO PRSUs were valued using a Monte Carlo simulation model.

One-third of CEO PRSUs will be earned if, within 36 months following the grant date, the closing price of a share of the Company’s common stock is greater than or equal to $26.00, $28.00 and $30.00, respectively, over any 20 trading days within any 30-consecutive trading day period. One-third of CEO PRSUs is associated with the achievement of each stock price hurdle. Each CEO PRSU will vest ratably on a quarterly basis on the first day of each quarter, beginning January 1, 2022, over a 30-month vesting period, beginning October 1, 2021, provided the CEO continues to serve as an employee of the Company through the applicable vesting date (subject to specified exceptions).

Each CEO RSU will vest ratably on a quarterly basis on the first day of each quarter, beginning January 1, 2022, over the applicable vesting period (30 months for CEO RSUs and 36 months for CEO TWW RSUs), beginning October 1, 2021, provided the CEO continues to serve as an employee of the Company through the applicable vesting date (subject to specified exceptions).

All February 2022 CEO awards have a minimum post-vesting holding period of three years from their respective vesting dates.