SmartRent, Inc 8-K, filed Apr 10, 2025
SmartRent, Inc. (SMRT)
About this 8-K
SmartRent, Inc filed this 8-K on April 10, 2025, reporting on events of April 9, 2025.
Items reported
- Item 2.02: Financial results
- Item 5.02: Director or officer change, or executive pay
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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Item 2.02. Results of Operations and Financial Condition.
On April 10, 2025, SmartRent, Inc. (the “Company”) issued a press release announcing certain preliminary financial results for the first quarter ended March 31, 2025. A copy of the Company’s press release is attached hereto as Exhibit 99.1 and incorporated herein by reference.
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
CEO Transition
On April 10, 2025, the Company announced the departure of Michael Shane Paladin, the Company’s President and Chief Executive Officer (“CEO”) and member of the Company’s Board of Directors (the “Board”) effective April 9, 2025. As part of the transition, Mr. Paladin resigned as a member of the Board, effective April 9, 2025.
The Company has appointed John Dorman, the Company’s Chairperson of the Board (“Board Chair”), as the Company’s interim President and interim Chief Executive Officer (together, “Interim CEO”), effective as of April 9, 2025 (the “Start Date”).
Mr. Dorman, age 74, has served as a member of the Board since August 2021 and as Board Chair since July 2024. Previously, Mr. Dorman served as a director and, from 1998 to 2003, as Chair and Chief Executive Officer of Digital Insight Corporation (Nasdaq: DGIN), a provider of outsourced online banking applications and services. Prior to this role, he served as Senior Vice President and General Manager of the Global Financial Services Division of Oracle Corporation (“Oracle”). Earlier in his career, Mr. Dorman was Chair of the board of directors and Chief Executive Officer of Treasury Services Corporation, a provider of enterprise modeling and financial analysis software for global financial institutions prior to its acquisition by Oracle in 1997.
Mr. Dorman has served as a member of the board of directors of Target Hospitality Corp. (Nasdaq: TH), a vertically integrated specialty rental and hospitality services company, since February 2024. Mr. Dorman previously served as a member of the board of directors of loanDepot, Inc. (NYSE: LDI), a technology-empowered residential mortgage platform from February 2021 to June 2024; CoreLogic Inc. (NYSE: CLGX) from May 2012 to June 2021, and as Chair of the board of directors of Online Resources Corporation (Nasdaq: ORCC) from 2010 to 2013, when it was acquired by ACI Worldwide, Inc. Mr. Dorman also serves as the Chair of the board of directors of DeepDyve, Inc., a technology company, and as a member of the board of directors of Landgate Corp., a data-based marketplace for listing land for sale or for lease. Mr. Dorman holds a Bachelor of Arts in Business Administration and Philosophy from Occidental College and a Master of Business Administration in Finance from the USC Marshall School of Business.
There are no arrangements or understandings between Mr. Dorman and any other persons pursuant to which Mr. Dorman was appointed. There are no family relationships, as defined in Item 401 of Regulation S-K, between Mr. Dorman and any director, executive officer, or person nominated or chosen by the Company to become a director or executive officer. Additionally, there have been no transactions involving Mr. Dorman that would require disclosure under Item 404(a) of Regulation S-K.
On April 9, 2025, the Company and Mr. Dorman entered into an offer letter (the “Offer Letter”) describing the terms of Mr. Dorman’s employment as Interim CEO. The Offer Letter is effective as of the Start Date and will terminate as of the date a non-interim Chief Executive Officer commences employment with the Company, and in any event no later than June 30, 2025, unless mutually agreed in writing. Pursuant to the Offer Letter, Mr. Dorman will receive a base salary of $54,166.67 per month and will receive a total of three months of his base salary so long as he serves as Interim CEO from the Start Date through June 30, 2025 (or, if earlier, through the date on which a non-interim Chief Executive Officer of the Company commences employment, or the date on which Mr. Dorman ceases employment as Interim CEO due to his death or disability (as defined in the Offer Letter)). Additionally, Mr. Dorman will receive a bonus equal to $162,500 if he remains employed by the Company as Interim CEO through June 30 2025 (or, if earlier, through the date on which a non-interim Chief Executive Officer of the Company commences employment, or the date on which Mr. Dorman ceases employment as Interim CEO due to his death or disability). In addition, Mr. Dorman will receive a grant of time-based restricted stock units (“RSUs”) covering shares of the Company’s Class A common stock (the “Common Stock”) with a total intended value of $250,000. The number of shares underlying the RSUs will equal $250,000 divided by the simple average of the closing price per share of the Common Stock for the trailing 30-trading days up to and including the Start Date, rounded down to the nearest whole share of Common Stock. The RSUs will be scheduled to vest in 2027 on the last day of Mr. Dorman’s current term as a member of the Board (or, if earlier, the date of a change in control (as defined in the Offer Letter), or the date on which Mr. Dorman ceases to be a member of the Board due to his death or disability), subject in each case to Mr. Dorman’s continued service to the Company through the applicable vesting date. To the extent that Mr. Dorman forfeits or does not receive compensation that Mr. Dorman otherwise would have received under the Company’s Non-Employee Director Compensation Policy as a non-employee member of the Board (but for serving as Interim CEO), the Company will make payments to Mr. Dorman equal to the amount of forfeited or unpaid compensation at the same time(s) and in the same amount(s) that otherwise would have applied. Mr. Dorman will not be entitled to participate in the Company’s employee retirement, insurance, benefit and vacation programs, except as may be required by law or the eligibility requirements of the applicable plan or program.
If any payment or benefit payable to Mr. Dorman constitute “parachute payments” under Section 280G of the U.S. tax code and would be subject to the applicable excise tax, then Mr. Dorman’s payments or benefits will be either (i) delivered in full or (ii) delivered to such lesser extent which would result in no portion of such benefits being subject to the excise tax, whichever results in the receipt by Mr. Dorman on an after-tax basis of the greatest amount of benefits.
The foregoing is a summary of the material terms of the Offer Letter and is qualified in its entirety by reference to the complete text of the Offer Letter, a copy of which will be included as an exhibit to the Company’s future SEC filings.
Paladin Separation Agreement and Release
On April 9, 2025, the Company and Mr. Paladin entered into a Separation Agreement and Release (the “Separation Agreement”). The Separation Agreement provides that, in exchange for Mr. Paladin executing a release of claims in favor of the Company and its affiliates, complying with existing restrictive covenants (including a non-compete), resigning from the Board and agreeing to other terms of the Separation Agreement, Mr. Paladin will receive (i) a lump sum cash payment of $81,250 (reflecting one and one-half months of base salary), (ii) the opportunity to serve as a non-employee advisor to the Company pursuant to the terms of an Advisor Agreement (the “Advisor Agreement”) working for up to ten hours per week for a period of up to three months, (iii) an additional lump sum cash payment of $81,250 if Mr. Paladin executes (and does not subsequently revoke) a Supplemental Release Agreement within 21 days following termination of the Advisor Agreement, and (iv) a lump sum cash payment of $6,148.20 approximating the cost of three months of COBRA coverage. The Advisor Agreement provides that Mr. Paladin will receive a cash payment of $10,000 per month for service as an advisor to the Company.
The foregoing is a summary of the material terms of the Separation Agreement and is qualified in its entirety by reference to the complete text of the Separation Agreement, a copy of which will be included as an exhibit to the Company’s future SEC filings.
Item 7.01. Regulation FD Disclosure.
On April 10, 2025, the Company issued a press release announcing a Chief Executive Officer transition plan under which Michael Shane Paladin’s tenure as the Company’s President and Chief Executive Officer and member of the Board ended effective April 9, 2025 as described above. A copy of such press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information set forth in Item 2.02 and Item 7.01 of this Current Report on Form 8-K and Exhibit 99.1 attached hereto is intended to be furnished and 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 in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. |
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99.1 |
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Cover Page Interactive Data File (formatted as Inline XBRL). |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: April 10, 2025
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SMARTRENT, INC. |
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By: |
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/s/ John Dorman |
Name: |
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John Dorman |
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Interim Chief Executive Officer
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Exhibit 99.1
SmartRent Announces CEO Resignation
Shane Paladin Steps Down as President and CEO and Resigns from Board
Chairman John Dorman Named Interim CEO
Scottsdale, Ariz., April 10, 2025 – SmartRent, Inc. (NYSE: SMRT) (“SmartRent” or the “Company”), the leading provider of smart communities and smart operations solutions for the rental housing industry, today announced that, at the request of the Board of Directors, Shane Paladin has stepped down from his positions as President and CEO, and resigned from the Board, effective immediately. John Dorman, Chairman of the Board, has been appointed interim CEO and Alison Dean has been appointed lead independent director. The Board has reinitiated its search with an executive search firm to assist in finding SmartRent’s next CEO and is already in the process of identifying and evaluating candidates. Paladin will remain with the Company in an advisory role for three months to ensure a smooth transition.
“I am confident that our executive leadership team and our entire organization will execute well and continue advancing our strategy as we navigate this transition,” said Dorman. “The Board continues to believe that SmartRent has a tremendous opportunity in front of us, underpinned by our leading market position and the quality of our products and services. We have made great strides in transforming our organization and operations to get us where we need to be, and the Board remains fully committed to SmartRent’s continued success and growth opportunities. We appreciate Shane’s cooperation in facilitating a smooth transition as we look for our next CEO.”
Preliminary First Quarter 2025 Results
On a preliminary basis, the Company expects first quarter 2025 total revenue of $40.5-$41.5 million, a decrease of 18-20% from the same period last year.
About SmartRent
Founded in 2017, SmartRent, Inc. (NYSE: SMRT) is a leading provider of smart communities solutions and smart operations solutions to the rental housing industry. SmartRent’s end-to-end ecosystem powers smarter living and working in rental housing by automating operations, protecting assets, reducing energy consumption and more. The company’s differentiators - purpose-built software and hardware, and end-to-end implementation and support - create an exceptional experience, with 15 of the top 20 multifamily operators and millions of users leveraging SMRT solutions daily. For more information, please visit smartrent.com.
Exhibit 99.1
Forward-Looking Statements
This press release contains forward-looking statements which address the Company's expected future business and financial performance, areas of focus, including our operations, approach to operational and financial discipline, leadership transition, expected growth, strategy, performance, financial review, and other future events and forward-looking statements. Forward-looking statements may contain words such as "goal," "target," "future," "estimate," "expect," "anticipate," "intend," "plan," "believe," "seek," "project," "may," "should," "will" or similar expressions. Examples of forward-looking statements include, among others, statements regarding the expected financial results, product portfolio enhancements, expansion plans and opportunities and earnings guidance related to financial and operational metrics. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those currently anticipated. Some of the factors that could cause actual results to differ materially from those expressed or implied by the forward-looking statements include, among other things, our ability to: (1) accelerate adoption of our products and services; (2) anticipate the uncertainties inherent in the development of new business lines and business strategies; (3) manage risks associated with our third-party suppliers and manufacturers and partners for our products; (4) manage risks associated with adverse macroeconomic conditions, including inflation, slower growth or recession, barriers to trade, changes to fiscal and monetary policy, tighter credit, higher interest rates, high unemployment, and currency fluctuations; (5) attract, train, and retain effective officers, key employees and directors and manage risks associated with the leadership transition; (6) develop, design, manufacture, and sell products and services that are differentiated from those of competitors; (7) realize the benefits expected from our acquisitions; (8) acquire or make investments in other businesses, patents, technologies, products or services to grow the business; (9) successfully pursue, defend, resolve or anticipate the outcome of pending or future litigation matters; (10) comply with laws and regulations applicable to our business, including privacy regulations; (11) realize the benefits expected from our stock repurchase program; and (12) maintain key strategic relationships with partners and distributors. The forward-looking statements herein represent the judgment of the Company, as of the date of this release, and SmartRent disclaims any intent or obligation to update forward-looking statements. This press release should be read in conjunction with the information included in the Company's other press releases, reports and other filings with the SEC. Understanding the information contained in these filings is important in order to fully understand the Company's reported financial results and our business outlook for future periods.
Investor Contact
Kelly Reisdorf
Head of Investor Relations investors@smartrent.com
Media Contact
Amanda Chavez
Vice President, Marketing & Communications media@smartrent.com