DEF 14A of Manhattan Associates Inc
Filed Apr 2, 2025 · FY20240000950170-25-049285
Named Executive Officer Compensation
| Name and Principal Position | Salary | Bonus | Stock Awards | Non-Equity Incentive Plan Compensation | All Other Compensation | Total | | (1) Eddie Capel | $725,000 | $0 | $9,100,094 | $920,750 | $43,831 | $10,789,675 | | President, Chief Executive | | | | | | | | Officer, and Director | | | | | | | | Dennis B. Story | 493,000 | 0 | 1,950,114 | 482,600 | 35,369 | 2,961,083 | | Executive Vice President, Chief | | | | | | | | Financial Officer, and Treasurer | | | | | | | | Bruce S. Richards | 387,000 | 0 | 700,024 | 299,720 | 35,319 | 1,422,063 | | Senior Vice President, Chief | | | | | | | | Legal Officer, and Secretary | | | | | | | | Robert G. Howell | 410,000 | 0 | 1,600,210 | 523,240 | 34,916 | 2,568,366 | | Executive Vice President, | | | | | | | | Americas | | | | | | | | J. Stewart Gantt | 425,000 | 0 | 1,500,020 | 482,600 | 25,060 | 2,432,680 | | Executive Vice President, | | | | | | | | Professional Services | | | | | | |
Proposal 1 – Election of Class III Directors
Proposal 1 – Election of Class III Directors The Board of Directors has nine members divided into three classes. The term of each Director is three years, and the terms of the Directors are staggered by class. The Board currently comprises three Class I Directors (Messrs. Capel and Moran, and Ms. Hollembaek), whose terms expire in 2026, three Class II Directors (Messrs. Clark, Raghavan, and Eger), whose terms expire in 2027, and three Class III Directors (Messrs. Huntz and Noonan, and Ms. Kuryea), whose terms expire at the Annual Meeting. On the Nomination and Governance Committee’s recommendation, the Board has nominated Mr. Noonan and Ms. Kuryea for re-election as Class III Directors. Mr. Huntz is not standing for reelection at the Annual Meeting in accordance with the Company's mandatory retirement policy set forth in our Bylaws. Our Bylaws provide that no nominee for director will be eligible to serve if they have attained the age of 75 or if their 75th birthday would occur during the term of office for which they are nominated. Effective as of February 12, 2025 and in connection with the appointment of Mr. Clark as the Company’s President and Chief Executive Officer, the Board increased the size of the Board from eight to nine members, appointed Mr. Clark to serve as a Class II Board member with a term expiring in 2027, and reclassified Ms. Linda T. Hollembaek (who was elected at the Company’s 2024 annual meeting of shareholders as a Class II Board member) to a Class I Board member with a term expiring in 2026. There are no family relationships among our Directors or Director nominees. Shares represented by executed proxies will be voted for the election of the nominees named below, unless the authority to do so is withheld. If any nominee unexpectedly becomes unavailable for election, the individuals acting as proxies may exercise their discretion to vote for the election of the Board’s substitute nominee. The individuals nominated for election at the Annual Meeting have agreed to serve if elected, and the Board has no reason to believe that they will be unable to serve.
Proposal 1 – Election of Class III Directors
| ✓ THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE NAMED NOMINEES. |
Board of Directors and Committees
Board of Directors and Committees
director Nominees
director Nominees Set forth below are our nominees to serve as Class III Directors (terms expire in 2028).
Thomas E. Noonan
Thomas E. Noonan
Thomas E. Noonan
| Primary Occupation | Age | Director Since | Current Term Expires | Board Committees | Other Public Company Boards | Director Qualification Highlights | | General Partner of TechOperators, LLC | 64 | 1999 | 2025 | ✓ Audit ✓ Compensation (Chair) | ✓ Intercontinental Exchange, Inc. | ✓ Accounting and finance ✓ Business operations ✓ Corporate governance ✓ Leadership - former CEO ✓ Technology and software industries |
Thomas E. Noonan
Thomas E. Noonan, age 64, has served as a member of our Board since January 1999. Since 2008, Mr. Noonan has served as a Partner of TechOperators, LLC, an early stage technology investment firm that he founded. From 2013 until 2020, he served on the Board of Directors of Ionic Security Inc., a data security company funded by TechOperators, including as Executive Chairman from January 2016. He is also Chairman of TEN Holdings, LLC, a diversified family office investment company. From July 2013 until November 2015, Mr. Noonan served as Senior Director and General Manager for the EnergyWise product group at Cisco Systems, which in July 2013, had acquired JouleX, a company founded by Mr. Noonan, which was a leading innovator in network-based enterprise management. Since 2010, Mr. Noonan had served as President and Chief Executive Officer of JouleX. From November 2006 until February 2008, Mr. Noonan served as the General Manager of IBM Internet Security Systems, a division of IBM providing information technology system security products and services. Mr. Noonan served as the President and member of the Board of Directors of Internet Security Systems, Inc., since May 1995, and as its Chief Executive Officer and Chairman from November 1996 until its acquisition by IBM in November 2006. Prior to joining
Thomas E. Noonan
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Thomas E. Noonan
Internet Security Systems, Mr. Noonan served as Vice President, Sales and Marketing with TSI International, Inc., an electronic commerce company, from October 1994 until April 1995. From November 1989 until October 1994, Mr. Noonan held high-level sales and marketing positions at Dun & Bradstreet Software, a developer of enterprise business software. Mr. Noonan also serves on the boards of Intercontinental Exchange, Inc. (NYSE: ICE), Children’s Healthcare of Atlanta, and the Georgia Tech Foundation. He served on the National Infrastructure Advisory Council from 2002 through 2019. In connection with Mr. Capel becoming Executive Chairman of the Board upon Mr. Huntz’s retirement from Board service at the Annual Meeting, the Company expects that Mr. Noonan will become Lead Independent Director. Mr. Noonan brings to the Company many years of experience in senior management in the software industry, including as co-founder, Chairman, President, and Chief Executive Officer of a public software company. We believe his entrepreneurial, executive management, and software industry experience is an indispensable resource to the Board. His executive experiences, in which he has dealt with public company compensation plan design and implementation, qualify him well to continue to chair our Compensation Committee. Mr. Noonan’s familiarity and experience with corporate accounting and finance matters at public companies qualify him to continue service on our Audit Committee. Our Board has determined he is an “audit committee financial expert” as defined in SEC rules.
Kimberly A. Kuryea
Kimberly A. Kuryea
Kimberly A. Kuryea
| Primary Occupation | Age | Director Since | Current Term Expires | Board Committees | Other Public Company Boards | Director Qualification Highlights | | Senior Vice President, Chief Financial Officer of General Dynamics Corporation | 58 | 2022 | 2025 | ✓ Audit | None | ✓ Accounting and Finance ✓ Business operations ✓ Corporate governance ✓ Executive compensation |
Biography
Biography Kimberly A. Kuryea, age 58, is the Senior Vice President, Chief Financial Officer at General Dynamics Corporation, a global aerospace and defense company that offers a portfolio of products and services in: business aviation; combat vehicles, weapons systems, and munitions; information technology (IT) services: “C4ISR” (command, control, communications, computers, intelligence, surveillance, and reconnaissance); and shipbuilding and repair. Previously, Ms. Kuryea served as Chief Human Resources Officer and SVP, Administration from 2017 to February 2023. Additionally, Ms. Kuryea served General Dynamics as Vice President and Controller from 2011 until 2017, Vice President, Chief Financial Officer, Advanced Information Systems, from 2007 to 2011, Staff Vice President, Internal Audit, from 2004 to 2007, and Director, Financial Planning & Analysis, from 2000 to 2004. From 1997 until 2000, Ms. Kuryea served as an Audit Senior Manager for the audit and tax consulting firm, Arthur Andersen. She also served in other roles at Arthur Andersen from 1989 through 1997. Ms. Kuryea is a Certified Public Accountant in the Commonwealth of Virginia.
Experience, Skills and Qualifications of Particular Relevance to Manhattan Associates
Experience, Skills and Qualifications of Particular Relevance to Manhattan Associates Ms. Kuryea brings to the Board public company expertise in financial accounting and reporting, ESG, executive compensation, strategic operations, and corporate governance. Her knowledge in these areas, and leadership experience as an executive of a Fortune 100 company, have enabled her to contribute significant value to our Board and as a member of our Audit Committee during her first term. Our Board has determined Ms. Kuryea is an "audit committee financial expert" as defined in SEC rules.
Class I Directors
Class I Directors The members of our Board serving as Class I Directors, whose terms are scheduled to expire on the date of our 2026 Annual Meeting, are as follows:
Class I Directors
| | 15 |
Eddie Capel
Eddie Capel
Eddie Capel
| Primary Occupation | Age | Director Since | Current Term Expires | Board Committees | Other Public Company Boards | Director Qualification Highlights | | Executive Vice-Chairman | 64 | 2012 | 2026 | None | ✓ Skyline Champion Corporation | ✓ Business operations ✓ Business development and corporate transactions ✓ Insider's knowledge of day-to-day operations of the Company ✓ Leadership - current President and CEO ✓ Supply chain management ✓ Technology and software industries |
Eddie Capel
Eddie Capel, age 64, has served as our Executive Vice-Chairman since February 12, 2025. Prior to that, since January 1, 2013, Mr. Capel served as our President and Chief Executive Officer. Prior to that, beginning in July 2012, Mr. Capel served as our President and Chief Operating Officer. Also, in July 2012, the Board elected Mr. Capel to the Board as a Class I director. Prior to becoming our President, Mr. Capel served as Executive Vice President and Chief Operating Officer since January 12, 2011. Previously, Mr. Capel served as our Executive Vice President—Global Operations from January 2009 to January 2011. In this capacity, Mr. Capel was responsible for the Company’s global product management, research and development, and customer support functions. From January 2008 through January 2009, Mr. Capel served as our Executive Vice President—Global Product Management and Customer Services. From January 2005 to January 2007, Mr. Capel served as our Senior Vice President—Global Product Management and Global Customer Services and from January 2004 through January 2005 as our Senior Vice President Product Management. Prior to January 2004, he held various other positions with the Company. Prior to joining Manhattan Associates in June 2000, Mr. Capel held various positions at Real Time Solutions, including chief operations officer and vice president, operations. He also served as director, operations, with Unarco Automation, an industrial automation/robotics systems integrator. Prior to joining Unarco, Mr. Capel worked as a project manager and system designer for ABB Robotics in the United Kingdom. Mr. Capel also serves as Chair of the Board of Skyline Champion Corporation (NYSE: SKY) and is Chair of its Compensation Committee. In connection with Mr. Huntz’s retirement from Board service, the Company expects Mr. Capel to become Executive Chairman of the Board.
Experience, Skills and Qualifications of Particular Relevance to Manhattan Associates
Experience, Skills and Qualifications of Particular Relevance to Manhattan Associates As our President and Chief Executive Officer, Mr. Capel’s insider and industry perspectives, and knowledge of the Company’s day-to-day operations, enable him to work with the Board and provide essential leadership in strategy development and implementation, allocation of company resources, and communication with the Company’s various stakeholders and audiences.
Charles E. Moran
Charles E. Moran
Charles E. Moran
| Primary Occupation | Age | Director Since | Current Term Expires | Board Committees | Other Public Company Boards | Director Qualification Highlights | | Chairman and CEO of Skillsoft Corporation (Retired) | 70 | 2017 | 2026 | ✓ Compensation | ✓ Commvault Systems, Inc. ✓ Intapp, Inc. | ✓ Accounting and finance ✓ Business strategy and operations ✓ Corporate governance ✓ Leadership - former CEO ✓ Technology and software industries |
Charles E. Moran
Charles E. Moran, age 70, has served as a member of our Board since May 2017. Mr. Moran retired as the Chairman and Chief Executive Officer of Skillsoft Corporation, a leading global provider of cloud-based learning and talent management solutions. Mr. Moran held those positions from 1998 to 2015 and remained on as the Chairman from 2015 to 2016. From 1995 to 1997, Mr. Moran served as the President and Chief Executive Officer of NETg, a subsidiary of National Education Corporation, and a provider of computer-based training for IT professionals. From 1993 to 1994, he served as the Chief Operating Officer and Chief Financial Officer of SoftDesk, a leading Architecture, Engineering and Construction/Computer-Aided Design software
Charles E. Moran
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Charles E. Moran
application company, which was acquired by Autodesk. From 1992 to 1993, he served as the President of Sytron Corp, a data management software subsidiary of Rexon, Inc. From 1989 to 1992, he was Vice President of Sales and Marketing at Insite Peripherals, a manufacturer of floppy disk drives. Prior to joining Insite Peripherals, his experience included various business management positions with Archive Corporation, Florida Data, and Hamilton-Avnet Corporation. From 2009 to 2014, Mr. Moran served on the Board of Directors at Higher One, Inc., a leading payment technology provider for higher education. From 1997 to 2001, he served on the Board of Directors at Workgroup Technology, a client/server product data management solution. He also previously served on the Boards of Duck Creek Technologies (insurance industry software) and Clarivate Analytics Plc (technology solutions to accelerate innovation). Currently, Mr. Moran also serves on the Boards of Commvault Systems, Inc. (NASDAQ: CVLT) and Intapp Inc. (NASDAQ: INTA). Mr. Moran brings expertise to the Board on digital transformation, cloud and SaaS business models, and cybersecurity. A well-rounded executive, Mr. Moran grew up in sales, proved his financial acumen through his time as a Chief Financial Officer, and is recognized as an outstanding strategist and operator. We believe Mr. Moran’s extensive background and knowledge in technology and consulting, and his leadership experience as a corporate executive, make him well-suited to continue to add value to the Company’s Board.
Linda T. Hollembaek
Linda T. Hollembaek
Linda T. Hollembaek
| Primary Occupation | Age | Director Since | Current Term Expires | Board Committees | Other Public Company Boards | Director Qualification Highlights | | Senior Vice President, Integration Management Officer of Lexmark International, Inc. (Retired) | 67 | 2018 | 2026 | ✓ Nomination & Governance | ✓ None | ✓ Business operations ✓ International markets ✓ Corporate transformation ✓ Leadership - former senior executive ✓ Supply chain management |
Biography
Biography Linda T. Hollembaek, age 67, has served as a member of our Board since May 2018. Ms. Hollembaek retired as Senior Vice President, Integration Management Officer of Lexmark International, Inc., a multifaceted technology company that delivers innovative imaging solutions and services to business and consumers worldwide. Ms. Hollembaek served in that role from 2016 until 2017. From 1999 to 2016, Ms. Hollembaek served in other management positions with Lexmark, including Vice President, Global Supply Chain Operations, and Vice President, General Manager of World Wide Services Operations. From 1996 to 1999, she served as Vice President, Sales & Operations, North America, at Danka Services International, one of the world’s largest independent suppliers of office imaging equipment and related services, parts, and supplies. From 1980 to 1996, she held various management positions with Eastman Kodak Company and last served as Vice President, Sales and Operations, North America.
Experience, Skills and Qualifications of Particular Relevance to Manhattan Associates
Experience, Skills and Qualifications of Particular Relevance to Manhattan Associates Ms. Hollembaek brings expertise to the Board on supply chain management, corporate transformation, global workforce leadership, international operations, and Asia-Pacific markets. We believe her knowledge and leadership experience in these areas will enable her to contribute significant value to our Board.
Class II Directors
Class II Directors The members of our Board serving as Class II Directors, whose terms are scheduled to expire on the date of our 2027 Annual Meeting, are as follows:
Class II Directors
| | 17 |
Eric A. Clark
Eric A. Clark
Eric A. Clark
| Primary Occupation | Age | Director Since | Current Term Expires | Board Committees | Other Public Company Boards | Director Qualification Highlights | | President and CEO of Manhattan Associates, Inc. | 54 | 2025 | 2027 | None | None | ✓ Domestic and international business strategy development, sales, and operations ✓ Software and data industries ✓ Software and date industries ✓ Leadership – prior and current CEO ✓ Acquisitions |
Eric A. Clark
Eric A. Clark, age 54, has served as President and Chief Executive Officer and a member of the Board since February 2025. Before that, since April 2024, Mr. Clark served as Chief Executive Officer of NTT Data North America, a technology consulting, digital transformation and IT infrastructure company, and prior to that, since September 2022, he served as Chief Executive Officer of NTT Ltd. Americas, another NTT Data group technology services company that combined with NTT Data North America in 2024. Prior to that, from 2016 to 2018, Mr. Clark served as the global Chief Digital and Strategy Officer for NTT Data Services. Before joining NTT, from 2012 to 2016, he served as Senior Vice President and Managing Director, Global Services, at ServiceNow, a business management software company, various Vice President roles with IT services business Dell Services (acquired by NTT in 2016), including most recently as Vice President, Global Commercial Industries. Before joining Dell, he served in various leadership roles with IT company Hewlett-Packard, including most recently as Global Vice President, Application Innovation Services.
Experience, Skills and Qualifications of Particular Relevance to Manhattan Associates
Experience, Skills and Qualifications of Particular Relevance to Manhattan Associates Mr. Clark has served in various leadership roles for prominent IT companies, and brings to the Board, and to the Manhattan CEO role, extensive expertise in professional services, including driving growth strategies and developing, selling, and delivering transformational digital solutions in domestic, international, and emerging markets. Mr. Clark has broad and deep industry experience in the key Company customer markets of retail, manufacturing, transportation, and government.
Deepak Raghavan
Deepak Raghavan
Deepak Raghavan
| Primary Occupation | Age | Director Since | Current Term Expires | Board Committees | Other Public Company Boards | Director Qualification Highlights | | Professor of Practice at Georgia State University | 58 | 1998 | 2027 | ✓ Nomination & Governance (Chair) | None | ✓ Business operations ✓ Business development and corporate transformation ✓ Corporate governance ✓ Supply chain management ✓ Technology and software industries |
Deepak Raghavan
Deepak Raghavan, age 58, a co-founder of the Company, has served as a member of our Board since February 1998. Dr. Raghavan conceptualized, designed and developed the Company’s PkMS® solution—the industry's first "packaged" supply chain execution system. Dr. Raghavan served as our Senior Vice President—Product Strategy from January 2001 until June 2002, as Senior Vice President and Chief Technology Officer from August 1998 until January 2001, and as Chief Technology Officer from our inception in October 1990 until August 1998. From 1987 until 1990, Dr. Raghavan served as a Senior Software Engineer for Infosys Technologies Limited, a software development company, where he specialized in the design and implementation of information systems for the apparel manufacturing industry. He is currently lecturer and professor of practice at Georgia State University.
Deepak Raghavan
| | 18 |
Deepak Raghavan
Dr. Raghavan has been an officer of the Company or member of our Board since its inception, and during that time has helped guide the Company through its transformation from a small private software and services company to a growing public company. With approximately 30 years of experience with the Company, Dr. Raghavan brings deep institutional knowledge and perspective to our Board about our strengths, challenges, and opportunities, as well as significant industry experience. As chairman of our Nominations and Governance Committee, Dr. Raghavan’s principled leadership is reflected in numerous committee achievements, including recommending, and then establishing, a process for regular Board meeting presentations and discussions on material company risk areas; adoption of our Majority Voting Director Resignation Policy; adoption of our Director Status Change Resignation Policy, and adoption of our Proxy Access bylaw. Dr. Raghavan’s skills and perspectives also have best positioned him to oversee new Director onboarding and other Board transitions.
Edmond I. Eger III
Edmond I. Eger III
Edmond I. Eger III
| Primary Occupation | Age | Director Since | Current Term Expires | Board Committees | Other Public Company Boards | Director Qualification Highlights | | CEO of Rewards Network Establishment Services, Inc. | 64 | 2015 | 2027 | ✓ Audit | None | ✓ Business operations ✓ Corporate governance ✓ International operations ✓ Leadership - current CEO ✓ Financial industries |
Biography
Biography Edmond I. Eger III, age 64, has served as a member of our Board since October 2015. Since September 2017, Mr. Eger has served as the Chief Executive Officer and member of the Board of Directors of Rewards Network Establishment Services, Inc., which helps restaurants increase their revenue, traffic, and customer engagement through their innovative financial and marketing services. From December 2013 through January 2017, Mr. Eger served as the President and Chief Executive Officer of OANDA Corporation, a leader in online foreign exchange and over-the-counter commodities and indices trading services. From 2009 to 2013, he served as a Senior Vice President and General Manager for the Americas at PayPal, Inc., and as an advisor to the CEO at eBay Corporation. From 1999 to 2009, Mr. Eger held various management positions with Citigroup and last served as the CEO for its International Cards Business. Prior to joining Citigroup, his experience included various business management positions with Advanta, Standard Chartered Bank, Wells Fargo, and McKinsey & Company. From September 2013 to February 2015, he served on the Board of Directors at Digital River, Inc., a NASDAQ traded e-commerce and payment provider, which was sold to Siris Capital.
Director Compensation
Director Compensation The Company’s non-employee director compensation program for 2024 provided for the following annual cash and equity compensation:
Equity Compensation
| 2024 Director Compensation Table | | | | | Name (1) | Fees Paid In Cash | Stock Awards(2) | Total | | John J. Huntz, Jr. | $192,500 | $260,054 | $452,554 | | Thomas E. Noonan | 90,000 | 260,054 | 350,054 | | Deepak Raghavan | 70,000 | 260,054 | 330,054 | | Edmond I. Eger III | 70,000 | 260,054 | 330,054 | | Charles E. Moran | 67,500 | 260,054 | 327,554 | | Linda T. Hollembaek | 65,000 | 260,054 | 325,054 | | Kimberly A. Kuryea | 70,000 | 260,054 | 330,054 |
Compensation of our Chief Executive Officer
Compensation of our Chief Executive Officer Our CEO participates in the same executive compensation programs as our other executive officers, including the other NEOs. In determining compensation for our CEO, the Compensation Committee considers the same information and factors used in determining compensation for the other NEOs, except that our CEO does not make a recommendation to the Compensation Committee for his own compensation. For 2024, the Compensation Committee set Mr. Capel’s annual base salary at $725,000, with a target annual cash bonus opportunity equal to 100% of his base salary. The Company granted Mr. Capel an annual equity award of 41,690 RSUs (50% service-based and 50% performance-based). Based on our 2024 achievement against the performance measures under our short-term and long-term incentive programs (Targeted Revenue, New Cloud Bookings, and AOI, as defined on page 38, and achieved at 127%), Mr. Capel earned a cash bonus of $920,750 and 127% of the performance-based component of his 2024 performance-based RSU award (which equaled 26,473 shares), which will vest over four years.
Early 2025 Developments
Early 2025 Developments Mr. Clark. As discussed previously, the Board of Directors elected Mr. Eric A. Clark to succeed Mr. Capel as President & Chief Executive Officer of the Company effective February 12, 2025. Mr. Clark has entered into an employment agreement with the Company substantially in the form of the Company’s standard at-will executive employment agreement, terms of which are described later in this Proxy Statement under the heading “Employment Agreements” applicable to our NEOs. Mr. Clark’s compensation includes: an initial annual base salary of $800,000; a target opportunity for 2025 under the Company’s annual cash bonus plan equal to $800,000; a cash signing bonus of $3 million payable in three equal installments on February 14, 2025, July 14, 2025 and February 14, 2026; and an initial grant of service-based RSUs with a value at grant equal to $8 million, with $2.6 million vesting on February 14, 2025, $2.2 million vesting on each of February 14, 2026, and February 14, 2027, and the remaining $1 million vesting on February 14, 2028. Mr. Clark is also eligible to participate in customary awards under the Company’s long-term incentive programs, including an RSU grant in February 2025 that is 50% performance-based and 50% service-based, valued at $5 million with all units vesting pro-rata over a four-year period. Mr. Capel. In connection with Mr. Capel’s transition to Executive Vice-Chairman, and in anticipation of his expected transition to Executive Chairman in conjunction with the Annual Meeting, the Board adjusted Mr. Capel’s compensation package for 2025. Mr. Capel’s annual base salary was reduced to $507,500. Mr. Capel’s RSUs that were unvested as of January 23, 2025, will continue to vest in accordance with their terms. If Mr. Capel’s employment ceases, those unvested RSUs will continue to vest in accordance with their terms as long as his service as a Director continues. Mr. Capel will no longer participate in the Company’s annual performance-based cash bonus plan or be eligible to receive cash severance payments in connection with termination of his employment. Otherwise, he will continue to be eligible to participate in other benefit plans, programs and arrangements generally available to executives of the Company. If a “change of control” occurs, Mr. Capel’s RSUs that were unvested at January 23, 2025, will remain in effect. If, within 24 months following a change of control, the Company or its successor terminates his employment for reasons other than death, disability or “cause”, or if Mr. Capel terminates his employment for “constructive termination”, then those unvested RSUs will fully vest. In addition, if Mr. Capel is not reelected to the Board at a shareholder meeting where he stood for reelection, or if the Board accepts his resignation tendered pursuant to the Company’s Majority Voting Resignation Policy, then Mr. Capel’s RSUs that were unvested at January 23 will continue to vest in accordance with their terms.
The Role of the Compensation Consultant
The Role of the Compensation Consultant The Compensation Committee has the authority to retain compensation consultants and other advisors to assist it in performing its duties. In 2024, the Compensation Committee engaged Willis Towers Watson (through its subsidiary company Towers Watson Delaware Inc.) (“WTW”), as its compensation consultant. WTW reports to and is directed by the Compensation Committee. In general, the Compensation Committee directs WTW to provide periodic updates on market trends and developments, provide relevant and credible market data for assessing pay competitiveness, evaluate the alignment of the design of our executive compensation program with our business strategy, performance outcomes, and competitive pay practices. WTW participates in Compensation Committee meetings where the Committee makes substantive executive compensation decisions. The Company incurred approximately $80,000 in fees to WTW for those services provided in 2024. In connection with its review of WTW’s independence, the Compensation Committee considered the six specific independence factors adopted by the SEC and the NASDAQ Stock Market and determined that WTW is independent. In conducting its review, the Committee considered that one or more WTW corporate affiliates provide the Company brokerage and other services related to the Company’s employee healthcare and other group benefits, and that the Company paid those affiliates for those services approximately $354,000 in 2023 and $337,000 in 2024. Further, the Committee anticipates paying similar amounts in 2025. In concluding that the provision to the Company of healthcare and other group benefits services by those WTW affiliates does not constitute a conflict of
The Role of the Compensation Consultant
| | 34 |
The Role of the Compensation Consultant
interest that would compromise WTW’s independence, the Committee considered the following WTW representations and other information obtained as part of its due diligence: WTW has separated its compensation consulting services into a single, segregated business unit within WTW. ✓ The Committee was solely responsible for the decision to engage WTW, the Committee made its decision independent of any influence from others at the Company, and the Committee conducted its independence review prior to finalizing the engagement. ✓ WTW has represented that: o WTW has in place safeguards between its executive compensation consultants serving our Compensation Committee and the brokerage services provided to the Company to prevent any compromise of the independence of WTW’s executive compensation services. o Neither WTW’s lead executive compensation advisor for our engagement nor any member of that lead advisor’s team participates in any activities related to the brokerage services provided by the WTW brokerage services affiliate to the Company. o Individuals who are not part of the executive compensation consulting team for our Compensation Committee (other than designated quality reviewers) are precluded from involvement in the development of recommendations regarding the compensation of the Company’s executive officers and directors. o WTW executive compensation consultants who advise our Compensation Committee on the compensation of executive officers and directors may not serve in broader relationship-management roles for our Company. o The compensation paid to WTW executive compensation consultants is not directly tied to the fees paid, or to the expansion of the fees paid, by the Company, and the WTW executive compensation advisors receive no direct incentives based on other WTW services to the Company. ✓ WTW’s executive compensation associates are subject to their comprehensive Code of Business Conduct, which addresses conflicts of interest, and in that regard, WTW has represented that (i) the advice rendered by WTW to our Compensation Committee is not influenced by any other WTW work for the Company and (ii) the executive compensation consulting approaches that WTW follows and conclusions they reach are unaffected by the number or magnitude of any other services WTW provides to the Company. ✓ Company management purchases the brokerage services from the WTW brokerage services affiliate in the ordinary course of business, and manages the relationship with that affiliate, without involvement of our Compensation Committee.
Competitive Market Data
Competitive Market Data The Compensation Committee considers competitive market data when making pay determinations for our executive officers, including the NEOs. This is only one of many factors the Committee considers when making pay determinations, and the Committee does not benchmark or target a precise percentile or pay level relative to this information. Instead, the Compensation Committee uses this information as a general guide to determine if our executive compensation levels in the aggregate and by element are within a reasonable range compared with similar companies. The precise nature of our competitive market analysis varies each year based on the needs of the Company and the Compensation Committee in making pay determinations. Generally, the Committee evaluates competitive market practices using data drawn from
Competitive Market Data
| | 35 |
Competitive Market Data
both a group of peer companies. For purposes of determining 2024 compensation, the Compensation Committee used a peer group comprising the following companies:
Competitive Market Data
| Company Name (1) | Company Ticker | Revenue ($ MM) Last 4Q as of 10/02/2023 (2) | Market Cap September 2023 ($ billion) | | Manhattan Associates, Inc. | MANH | $848 | 12.2 | | ACI Worldwide, Inc. | ACIW | 1,371 | 2.4 | | Aspen Technology, Inc. | AZPN | 1,044 | 13.2 | | Blackbaud, Inc. | BLKB | 1,069 | 3.7 | | Ceridian HCM Holding Inc. | CDAY | 1,388 | 10.4 | | Commvault Systems, Inc. | CVLT | 785 | 3.0 | | Dynatrace, Inc. | DT | 1,224 | 13.7 | | Elastic N.V. | ESTC | 1,113 | 8.0 | | Fair Isaac Corporation | FICO | 1,473 | 21.6 | | Five9, Inc. | FIVN | 848 | 4.6 | | Guidewire Software, Inc. | GWRE | 905 | 7.3 | | HubSpot, Inc. | HUBS | 1,944 | 24.6 | | Paylocity Holding Corporation | PCTY | 1,175 | 10.2 | | PTC Inc. | PTC | 2,058 | 16.8 | | Qualys, Inc. | QLYS | 524 | 5.6 | | Q2 Holdings, Inc. | QTWO | 599 | 1.9 | | Smartsheet Inc. | SMAR | 867 | 5.5 | | SPS Commerce, Inc. | SPSC | 493 | 6.3 | | Tyler Technologies, Inc. | TYL | 1,902 | 16.2 | | Workiva Inc. | WK | 582 | 5.4 |
Competitive Market Data
For the 2024 market analysis used in establishing target executive compensation for 2025, the Committee approved changes to the peer group, removing Five9, Inc. and adding AppFolio, Inc. (2) Revenue data from S&P Capital IQ as of 10/02/2023. Market Cap data as of 9/29/2023. The Compensation Committee annually reviews pay and performance data from the compensation peer group as well as pay data from various compensation surveys. Both the peer group and survey data included companies that were comparable to the Company with respect to revenue level, market capitalization, industry segment, and competitive employment market. The specific peer companies, survey sources, and forms of analysis change from year to year based on the best available data and the key priorities of the Compensation Committee. The Committee considered this information along with other relevant information, such as the Company’s performance and that of each executive officer. Our CEO also presented recommendations to the Compensation Committee for our executive officers (other than himself). No other executive officer has direct input to the Compensation Committee regarding the compensation of the NEOs.
Principal Elements of Executive Compensation
Principal Elements of Executive Compensation We compensate our executive officers with a combination of base salary and short and long-term incentives designed to focus their efforts on maximizing both our short and long-term financial performance. The executive compensation program includes the following: (i) base salary, (ii) annual cash bonus, (iii) long-term incentive compensation in the form of equity awards, and (iv) other benefits. Each executive officer’s compensation package is designed to provide a mix of these elements, which the Compensation Committee believes provides a level of compensation roughly equivalent to that paid by companies of similar size and complexity and that balances short-term and long-term performance and reward objectives.
Annual Cash Bonus Program
Annual Cash Bonus Program The following table sets forth each NEO’s target annual cash bonus, payout amount, and payout percentage actually earned in 2024.
Annual Cash Bonus Program
| | | 2024 Annual Cash Bonus Program Target vs. Payout | | | | Name | Title | Target | Payout | Payout % (1) | | Eddie Capel | Executive Vice-Chairman of the Board; Former President, Chief Executive Officer | $725,000 | $920,750 | 127% | | Dennis B. Story | EVP, Chief Financial Officer, and Treasurer | 380,000 | 482,600 | 127% | | Bruce S. Richards | SVP, Chief Legal Officer, and Secretary | 236,000 | 299,720 | 127% | | Robert G. Howell | EVP, Americas | 412,000 | 523,240 | 127% | | J. Stewart Gantt | EVP, Professional Services | 350,000 | 444,500 | 127% |
Annual Cash Bonus Program
________________________________________________________________________________________ (1) See the table entitled “Annual Cash Bonus Program Design for 2024” on page 39 to see how we calculate the 2024 annual bonus. The target annual cash incentive opportunity as a percent of annual base salary for each of our NEOs in fiscal year 2024 was as follows:
Annual Cash Bonus Program
| Name | Fiscal Year 2023 Target Annual Incentive as Percent of Base Salary (%) | Year Over Year Percentage Change | Fiscal Year 2024 Target Annual Incentive as Percent of Base Salary (%) | | Eddie Capel | 101% | -1% | 100% | | Dennis B. Story | 77% | 0% | 77% | | Bruce S. Richards | 61% | 0% | 61% | | Robert G. Howell | 101% | -1% | 100% | | J. Stewart Gantt | 83% | -1% | 82% |
Annual Cash Bonus Program
The purpose of the Company’s annual cash bonus program is to align short-term incentive bonuses with the achievement of annual corporate performance. Each plan participant has a target bonus, which is expressed as a percentage of their base salary, and the actual bonus they receive is based on the Company’s level of achievement against three performance measures. For all the NEOs, as well as all other employee participants in the program during 2024, the Compensation Committee used Target Revenue, New Cloud Bookings, and AOI as the corporate performance measures to determine the bonus payouts (see definitions below). The Compensation Committee believes the combination of Target Revenue, New Cloud Bookings, and AOI creates the proper balance for motivating and rewarding profitable growth in the near-term that will translate into strong returns for shareholders over the long-term. The Compensation Committee excluded individual performance from the bonus measures for all program participants to focus and reward the team for collectively achieving our overall financial objectives.
Annual Cash Bonus Program
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Annual Cash Bonus Program
For purposes of the 2024 bonus program, for all plan participants: As defined in the program, “Target Revenue” is, in effect, consolidated revenue excluding revenue from hardware sales and billed travel, to minimize risk of low margin revenue lines skewing incentive plan payout percentages. ✓ As defined in the program, New Cloud Bookings quantifies or credits new cloud subscription transactions. For bonus purposes, this measure is calculated as the total new bookings value of all new contracts for cloud solutions closed during the period. ✓ As defined in the program, AOI excludes the following items from GAAP operating income: amortization of intangible assets, equity-based compensation expenses, an unusual health insurance claim, restructuring charges, and asset impairment charges and related recoveries. For 2024, the exclusions necessary were equity-based compensation expenses and an unusual health insurance claim. ✓ Consistent with prior years, all results were determined on a constant currency basis (i.e., actual financial results are translated to U.S. dollars at budgeted U.S. dollar exchange rates). Regarding our use of AOI, we use AOI to evaluate our overall business performance, and we believe AOI is useful for us, and our investors, when assessing our performance versus other software companies. Our January 28, 2025, earnings press release, attached to our Current Report on Form 8-K of the same date, included a full reconciliation from 2024 GAAP operating income to 2024 AOI (non-GAAP operating income). Regarding the establishment of the specific Target Revenue, New Cloud Bookings, and AOI performance measures for 2024, the Compensation Committee reviewed and considered senior management’s proposed 2024 budget and the critical assumptions underlying the final budget. In preparing the budget, senior management considered a variety of factors, including but not limited to: global economic trends, our business transition to cloud solutions, supply chain management information-technology investment and growth trends as published by leading industry analysts, the competitive position of our software products, the level of investment in product development needed to maintain sustainable competitive advantage, and historical financial performance. Senior management considers those factors in the context of the key objective of extending the Company’s position as a leading global supply chain commerce solutions provider. The Compensation Committee also considered the degree of difficulty and probability of achieving the performance levels with the Company’s business transition to cloud. The Committee set these levels so that the relative difficulty of achieving them were consistent with prior years. For the 2024 cash bonus program, the Compensation Committee weighted the corporate performance measures as follows: Target Revenue – 25%; New Cloud Bookings – 25%; AOI – 50%. For each measure, the Committee established performance ranges, with each range having a minimum performance threshold, performance target, and performance maximum. For each performance measure, achievement at the performance target pays out 100% of a target bonus payout for that measure, achievement at or below the minimum performance threshold pays out zero for that measure, and achievement at or above the performance maximum pays out 175% of the target payout for that measure. We determine the bonus payout percentage for achievement between the minimum performance threshold and target, or between target and the performance maximum, by linear interpolation. The annual total bonus payout percentage under the plan is the weighted average of the performance percentages for the three performance measures. The Compensation Committee has discretion to adjust final annual bonus amounts, which it did not exercise in 2024. For 2024, as in prior years, the Committee established quarterly minimum performance thresholds and targets adding up to the annual thresholds and targets, so that plan participants could earn and receive interim quarterly bonus installments, provided that those payments could not exceed the respective quarterly targets. Because of that, it was possible plan participants could receive some level of payout even if full-year minimum thresholds ultimately were not met, and it was possible that, if the annual target performance levels were achieved, the final quarterly bonus installment could exceed target for the final quarter.
Annual Cash Bonus Program
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Annual Cash Bonus Program
The following table provides the 2024 annual cash bonus payout levels as a percentage of the performance targets for Target Revenue, New Cloud Bookings, and AOI.
Annual Cash Bonus Program
| Annual Cash Bonus Program Design for 2024 | | | | | | | | Amount | Participant Bonus Payout % of Target | Actual Payout % Earned | Payout Weight | Weighted Actual Payout % Earned | | Target Revenue ($ in millions) - Weighting 25% | | | | | | | Threshold goal | $926.0 | 0% | | | | | Target goal | 980.0 | 100% | | | | | Maximum goal | 1,037.0 | 175% | | | | | 2024 Bonus Revenue - Earned | $1,005.3 | | 133% | 25% | 33.3% | | New Cloud Bookings - Weighting 25% | | | | | | | 2024 Bonus New Cloud Bookings - Earned | * | | 26% | 25% | 6.5% | | Adjusted Operating Income (AOI) ($ in millions) - Weighting 50% | | | | | | | Threshold goal | $283.0 | 0% | | | | | Target goal | 301.0 | 100% | | | | | Maximum goal | 360.0 | 175% | | | | | 2024 Bonus AOI - Earned | $360.9 | | 175% | 50% | 87.5% | | Total Combined Actual Payout % Earned [(133% x 25%) + (26% x 25%) + (175% x 50%)] = 127% | | | | | 127% |
Annual Cash Bonus Program
* We do not disclose the New Cloud Bookings performance target and actual level achieved. We believe that disclosure would provide our competitors with insight into our operations, resulting in serious competitive harm. The Compensation Committee set the New Cloud Bookings target based on our historical results, growth rates, and expected future results, and intended for it to require significant effort to achieve. The Compensation Committee has discretion to either increase or decrease a participant’s annual cash bonus under the bonus program. As in recent years, the Compensation Committee did not exercise its discretion with regard to the cash bonuses to our executive officers in 2024.
Long-term Incentive Compensation
Long-term Incentive Compensation The following table sets forth each NEO’s target annual long-term incentive opportunity, earned amounts at December 31, 2024, and change in total value percentages in 2024. The closing market price of the Company’s Common Stock on December 31, 2024, was $270.24, representing a 26% increase since December 31, 2023, and compares to a return of 30% for the NASDAQ Composite and 36% for the NASDAQ Computer Index.
Long-term Incentive Compensation
| 2024 Long-Term Incentive Compensation Target vs. Payout | | | | | | | | | | Target (1) | | | Earned Value at 12/31/2024 (2) | | | % Change | | Name | RSU (3) | PSU (4) | Total | RSU (3) | PSU (4) | Total | Total | | Eddie Capel | $4,550,047 | $4,550,047 | $9,100,094 | $5,633,153 | $7,154,064 | $12,787,217 | 41% | | Dennis B. Story | 975,057 | 975,057 | 1,950,114 | 1,207,162 | 1,533,072 | 2,740,234 | 41% | | Bruce S. Richards | 349,903 | 350,121 | 700,024 | 433,195 | 550,479 | 983,674 | 41% | | Robert G. Howell | 799,996 | 800,214 | 1,600,210 | 990,430 | 1,258,237 | 2,248,667 | 41% | | J. Stewart Gantt | 750,010 | 750,010 | 1,500,020 | 928,545 | 1,179,327 | 2,107,872 | 41% |
Long-term Incentive Compensation
______________ (1) These columns represent the aggregate grant date fair value for service-based and performance-based RSU awards. We determined these award fair values based on a price of $218.28, the closing market price of the Company’s Common Stock on the date of grant. These columns represent amounts earned, valued at $270.24, the closing market price of the Company’s Common Stock on December 31, 2024. We achieved a payout of 127% of the target for the performance-based component of our long-term equity program. The service-based and performance-based RSUs vest in four equal annual installments commencing in the year following the date of grant.
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Long-term Incentive Compensation
Represents service-based restricted stock units. Represents performance-based restricted stock units, sometimes referred to in this Proxy Statement as PSUs. We use equity awards to provide incentives to improve our financial performance and to assist in the recruitment, retention, and motivation of professional, managerial, and other personnel. These long-term incentives are designed to align the interests of our executive officers and other employee plan participants with those of our shareholders to enhance our overall value, the market price of the Common Stock, and as a result, our shareholders’ return. In addition, the vesting of equity incentives over time is designed to create an incentive for our people to remain with us. We grant RSUs to our executive officers and select other employees on an ongoing basis to provide continuing incentives to them to meet future performance goals and to remain with the Company. Equity-based compensation is an important component of our executive compensation program. In setting the form and level of the equity awards for the NEOs, the Compensation Committee considers the CEO’s recommendations, the executive officer’s performance, and a variety of other factors including: ✓ Market-competitive levels of total compensation, particularly for our peer group ✓ Market-competitive levels and forms of equity-based compensation ✓ Alignment with company performance and shareholder value ✓ The retention strength provided by outstanding and unvested equity awards held by the executives ✓ Global macro-economic conditions ✓ Our recent performance and trends ✓ The executive’s recent performance and potential future contribution ✓ The resulting annual grant rate from all awards ✓ The availability of shares under our shareholder approved equity plan ✓ Our cost and its alignment with participant value There is no precise formula or weighting applied to these factors as changing business conditions, competitive market practices, and regulations necessitate differing priorities to maximize effectiveness while minimizing cost and dilution. During 2024, the Company granted to the NEOs an aggregate of 68,034 RSUs, 50% service-based and 50% performance-based. In approving the individual award levels for the annual NEO grants, the Compensation Committee also reviewed aggregate grant levels for all recipients to ensure the annual grant rate was within competitive norms and sustainable over time. The annual awards granted in 2024 vest in four equal annual increments starting on or about the first anniversary of the grant date, with the performance portion tied to the same Target Revenue, New Cloud Bookings, and AOI performance measures and ranges for fiscal year 2024 as established for the annual cash bonus plan discussed above. Our performance goals are focused on internal key financial metrics that drive long-term value creation, such as Target Revenue, New Cloud Bookings, and AOI. Our past financial performance demonstrates, and we fully expect, that meeting these metrics will over time translate into increased shareholder value. For equity-based awards, our share price ultimately should reflect whether we have executed this strategy successfully, and we intend that the four-year vesting schedule for equity grants will ensure our officers maintain a long-term perspective. A look at our historical stock prices over the last 10 years shows a growth rate of 564%, from a stock price of $40.72 on December 31, 2014, to $270.24 on December 31, 2024, after giving effect to stock splits during this period. We believe this growth demonstrates that the achievement of our performance goals over this period resulted in creation of long-term value for our shareholders. Our long-term strategy emphasizes continued growth through a capital allocation approach coupling investment in innovation with a disciplined return of capital to shareholders self-funded through free cash flow. We intend the performance-based RSUs primarily to provide our executive officers with incentives to improve our performance, as they benefit from these awards only if we meet the pre-established financial goals specified in the awards in the year granted. The 2024 performance-based RSU awards were to be earned, in whole or in part, based on our attainment of the same annual Target Revenue, NACV, and AOI performance goals as established for the 2024 annual cash bonus program. For 2024, the Compensation Committee weighted the corporate performance measures as follows: Target Revenue – 25%; New Cloud Bookings – 25%; AOI – 50%. For each measure, the Committee established performance ranges, with each range having a minimum performance threshold, target threshold, and performance maximum. For each performance measure, achievement at the target threshold results in the executive earning 100% of the number of performance-based RSUs granted to them, achievement at or below the minimum performance threshold results in the executive earning zero performance-based RSUs for that measure, and achievement at or above
Long-term Incentive Compensation
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Long-term Incentive Compensation
the performance maximum results in the executive earning 175% of the number of performance-based RSUs granted. We determine the percentage of the performance-based RSUs earned for achievement between the minimum performance threshold and target, or between target and the performance maximum, by linear interpolation. The total percentage of performance-based RSUs earned is the weighted average of the performance percentages for the three performance measures. Under the 2024 program, for an executive to earn any of their performance-based RSUs, we were required to exceed one or more of the minimum performance thresholds. Based on our financial performance in 2024, the named executive officers earned 127% of the granted performance-based RSUs. The minimum performance threshold, performance target, and performance maximum for the 2024 performance measures, as well as our actual performance, are the same as set forth in the table “Annual Cash Bonus Program Design for 2024.” Perquisites and Other Personal Benefits. Currently, we do not view perquisites or other personal benefits as a significant component of our executive compensation program. Accordingly, we do not provide perquisites or other personal benefits to our executive officers, including the NEOs, except in situations where we believe it is appropriate to assist an individual in the performance of their duties, to make our executive officers more efficient and effective, and for recruitment and retention purposes. If an executive officer or other employee qualifies to attend our annual sales-oriented President’s Club event and incurs an income tax liability associated with their attendance and the attendance of their spouse, we provide a tax “gross-up” payment to offset that liability. During 2024, we provided a tax gross-up payment with respect to this event to Messrs. Capel, Howell, Richards, and Story. Health and Welfare Benefits. We offer standard Company health and welfare benefits to the NEOs as a safety net against the financial catastrophes that can result from illness, disability, or death. The benefits offered to the NEOs are substantially the same as those offered to all our regular employees, except that certain of the NEOs have been provided an arrangement under which the Company pays the premiums on term life insurance on their lives during their continued employment with the Company. During 2024, we paid term life insurance premiums, including income tax “gross-ups” with respect to those premiums, for Messrs. Capel, Story, Richards, Howell, and Gantt. Our tax-qualified deferred-compensation Section 401(k) Savings Plan covers all our eligible full-time employees. Under the plan, participants may elect to contribute, through salary deductions, up to 60% of their annual compensation, subject to a maximum of $23,000, or $30,500 for employees who are at least 50 years old. We provide 50% matching contributions up to the first 6% of salary contributed under the plan. The plan is designed to qualify under Section 401 of the Internal Revenue Code so that our employees’ and our contributions, and income earned on those contributions, are not taxable to employees until withdrawn from the plan, and so that the Company’s contributions are deductible when made. We do not provide any form of non-qualified deferred compensation program.
Employment Agreements
Employment Agreements Messrs. Capel, Story, Richards, Howell, and Gantt, are all parties to employment agreements with the Company. (Mr. Capel’s agreement was amended effective February 2025 in conjunction with his departure from the President and Chief Executive Officer role as described above under “Executive Compensation—Compensation Discussion and Analysis—Compensation of our Chief Executive Officer.”) The NEOs’ employment agreements are substantially identical, except for their job titles and their stated specific annual base salaries and bonus target amounts. Each agreement provides that the NEO will be (i) paid an annual base salary, (ii) eligible for an annual performance-based bonus, (iii) eligible for equity awards that reflect their position, duties, and responsibilities, (iv) eligible to participate in all other benefit plans, programs, and arrangements generally available to executives of the Company, (v) provided an indemnification agreement, under which the Company will indemnify the executive to the full extent permitted by law with respect to any claim arising out of the executive’s service as an officer, director, or employee of the Company, and (vi) covered by a director and officers liability insurance policy. As set forth in the agreements, the minimum annual base salaries of Messrs. Capel, Story, Richards, and Howell, and Gantt, are $575,000, $402,000, $320,000, $323,000, and $315,000, respectively. Each NEO’s annual base salary is subject to increases or decreases at the discretion of the Board or Compensation Committee. Each agreement further provides that the NEO or the Company may terminate that officer’s employment at any time. If the Company terminates the NEO’s employment for reasons other than death, disability, or “cause” (as defined in the agreement) or if there is a
Employment Agreements
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Employment Agreements
“constructive termination” of the executive officer’s employment (as defined in the agreement), the officer will be entitled to certain severance payments and benefits. Those payments and benefits are described below in the section entitled Potential Payments upon Termination, and that section also contains an estimate of the potential payments and benefits payable under these arrangements assuming a termination as of the end of 2024. In general, severance payments to a NEO are limited such that they will not receive any “parachute payment” as described in Sections 280G and 4999 of the Internal Revenue Code. The NEO is required to provide the Company with a general release of all claims to receive any severance payments or benefits. The agreements contain provisions requiring the NEO to protect the proprietary and confidential information of the Company. In addition, for a period of 12 months after termination of employment for any reason (or, if later, the last date any severance payments are due), the NEO agrees not to solicit the Company’s customers or solicit or hire away the Company’s employees and is prohibited from performing duties of the type performed for the Company for a competing business owned by any of a designated group of companies. The NEO also agrees to assign to the Company all patents, inventions, copyrights, and other intellectual property developed by them in the course of their employment.
Equity Award Timing Policies
Equity Award Timing Policies Generally (including in 2024), our Compensation Committee approves equity grants (such as RSUs and PSUs) to our executive officers at their first regularly scheduled meeting of the year, which is scheduled long in advance. We do not time material non-public information (MNPI) disclosure for purposes of affecting the value of executive compensation. The Board and Committee do not take MNPI into account when determining the timing and terms of awards. The Company does not currently grant awards of stock options, stock appreciation rights, or similar option-like instruments.
2024 Summary Compensation Table
2024 Summary Compensation Table The following table sets forth, for the three years ended December 31, 2024, the total compensation earned by the named executive officers.
2024 Summary Compensation Table
| Name and Principal Position | Year | Salary | Bonus(12) | Stock Awards(1) | Non-Equity Plan Compensation(2) | All Other Compensation(3) | Total | | Eddie Capel | 2024 | $725,000 | - | $9,100,094 | $920,750 | $43,831(4) | $10,789,675 | | Executive Vice-Chairman of the Board; | 2023 | 700,000 | - | 8,500,111 | 1,113,900 | 49,445 | 10,363,456 | | Former President, Chief Executive Officer | 2022 | 665,000 | - | 8,800,080(11) | 917,700 | 46,029 | 10,428,809 | | Dennis B. Story | 2024 | $493,000 | - | $1,950,114 | $482,600 | $35,369(5) | $2,961,083 | | Executive Vice President, Chief | 2023 | 473,000 | - | 1,850,037 | 576,700 | 34,856 | 2,934,593 | | Financial Officer, and Treasurer | 2022 | 450,000 | 3,000 | 4,750,088(11) | 469,200 | 31,998 | 5,704,286 | | Bruce S. Richards | 2024 | $387,000 | - | $700,024 | $299,720 | $35,319(6) | $1,422,063 | | Senior Vice President, Chief | 2023 | 367,000 | - | 660,105 | 355,500 | 34,836 | 1,417,441 | | Legal Officer, and Secretary | 2022 | 350,000 | 3,000 | 1,530,221(11) | 296,700 | 30,805 | 2,210,726 | | Robert G. Howell | 2024 | $410,000 | - | $1,600,210 | $523,240 | $34,916(7) | $2,568,366 | | Executive Vice President, | 2023 | 390,000 | - | 1,500,020 | 620,940 | 34,401 | 2,545,361 | | Americas | 2022 | 370,000 | 3,000 | 3,950,103(11) | 510,600 | 31,523 | 4,865,226 | | J. Stewart Gantt | 2024 | $425,000 | - | $1,500,020 | $482,600 | $25,060(8) | $2,432,680 | | Executive Vice President, | 2023 | 385,000 | - | 1,150,002 | 576,700 | 24,706 | 2,136,408 | | Professional Services | | | | | | | |
2024 Summary Compensation Table
______________ (1) The amounts in this column represent the aggregate grant date fair value for the stock awards (service-based and performance-based RSUs) granted in accordance with ASC Topic 718. We determined these fair values based on the assumptions set forth in the Company’s 2024 Annual Report on Form 10-K (Note 2, Equity-Based Compensation). Assuming the highest level of performance is achieved under the applicable performance conditions, the maximum grant date fair value of the performance-based RSUs granted to the NEOs in 2024 is: (i) in the case of Mr. Capel, $7,962,367; (ii) in the case of Mr. Story, $1,706,295; (iii) in the case of Mr. Richards, $612,712; (iv) in the case of Mr. Howell, $1,400,484; (v) and in the case of Mr. Gantt, $1,312,518. (2) Represent amounts earned in the applicable year, regardless of whether we paid those amounts prior to the end of such year. (3) The amounts in this column represent the Section 401(k) matching or similar Company contribution, tax “gross-up” payments on behalf of NEOs as discussed in the Compensation Discussion and Analysis section, and company-paid term life insurance premiums for the benefit of Messrs. Capel, Story, Richards, Howell, and Gantt. (4) This amount represents: (i) the Company’s contributions to Mr. Capel’s account under its Section 401(k) plan in the amount of $10,350; (ii) Company-paid term life insurance premiums in the amount of $15,169; and (iii) tax "gross-up" payments in the amount of $18,312. (5) This amount represents: (i) the Company’s contributions to Mr. Story’s account under its Section 401(k) plan in the amount of $10,350; (ii) Company-paid term life insurance premiums in the amount of $7,160; and (iii) tax "gross-up" payments in the amount of $17,859. (6) This amount represents: (i) the Company’s contributions to Mr. Richards’s account under its Section 401(k) plan in the amount of $10,350; (ii) Company-paid term life insurance premiums in the amount of $7,149; and (iii) tax "gross-up" payments in the amount of $17,850. (7) This amount represents: (i) the Company’s contributions to Mr. Howell’s account under its Section 401(k) plan in the amount of $10,350; (ii) Company-paid term life insurance premiums in the amount of $6,910; and (iii) tax "gross-up" payments in the amount of $17,656. (8) This amount represents the Company’s contributions to Mr. Gantt's account under its Section 401(k) plan in the amount of $10,350; (ii) Company-paid term life insurance premiums in the amount of $8,129; and (iii) tax "gross-up" payments in the amount of $6,581. (9) In January 2021, our Compensation Committee granted the NEOs a one-time, one-year-vesting, service-based RSUs in lieu of the cash merit increase (see “Grants of Plan-Based Awards” table for details). (10) In January 2021, our Compensation Committee granted the CEO and CFO a special (one-time), one-year-vesting, service-based RSUs in lieu of, and valued in an amount equal to two times, a reasonable annual salary increase for 2021, also to “repay” them for their respective 2020 Covid-19-related cash compensation reductions (see “Grants of Plan-Based Awards” table for details). (11) In January 2022, our Compensation Committee approved a special retention grant of service-based RSUs to members of our executive team, including our NEOs. The Committee intended that grant, which vests over four years, to further motivate our dedicated and experienced executive team to remain with the Company to best ensure continued execution of our transition to a cloud-first Company. More specifically, those RSUs vest as follows, so long as the executive remains employed with the Company on the applicable vesting date: 10% in January 2024; 20% in January 2025; 30% in January 2026; and 40% in January 2027. The amounts in this column represent special bonuses paid to all employees globally, excluding the CEO, in 2021 and 2022 in recognition of strong Company performance results.
2024 Summary Compensation Table
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2024 Grants of Plan-Based Awards Table
2024 Grants of Plan-Based Awards Table The following table provides information about our 2024 annual cash bonus opportunities and the equity awards granted to our named executive officers during the year ended December 31, 2024.
2024 Grants of Plan-Based Awards Table
| Plan-Based Compensation | | | | | | | | | | | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | | Estimated Future Payouts Under Equity Incentive Plan Awards(2) | | All Other Stock Awards: Number of Stock | Grant Date Fair Value of Stock | | Name | Award Type | Grant Date | Target ($) | Maximum ($) | Target (#) | Maximum (#) | Units(3) (#) | Awards(4) ($) | | Eddie Capel | Cash Bonus | 1/25/2024 | 725,000 | 1,268,750 | - | - | - | - | | | Service-based RSUs | 1/25/2024 | - | - | - | - | 20,845 | 4,550,047 | | | Performance-based RSUs | 1/25/2024 | - | - | 20,845 | 36,479 | - | 4,550,047 | | Dennis B. Story | Cash Bonus | 1/25/2024 | 380,000 | 665,000 | - | - | - | - | | | Service-based RSUs | 1/25/2024 | - | - | - | - | 4,467 | 975,057 | | | Performance-based RSUs | 1/25/2024 | - | - | 4,467 | 7,817 | - | 975,057 | | Bruce S. Richards | Cash Bonus | 1/25/2024 | 236,000 | 413,000 | - | - | - | - | | | Service-based RSUs | 1/25/2024 | - | - | - | - | 1,603 | 349,903 | | | Performance-based RSUs | 1/25/2024 | - | - | 1,604 | 2,807 | - | 350,121 | | Robert G. Howell | Cash Bonus | 1/25/2024 | 412,000 | 721,000 | - | - | - | - | | | Service-based RSUs | 1/25/2024 | - | - | - | - | 3,665 | 799,996 | | | Performance-based RSUs | 1/25/2024 | - | - | 3,666 | 6,416 | - | 800,214 | | J. Stewart Gantt | Cash Bonus | 1/25/2024 | 350,000 | 612,500 | - | - | - | - | | | Service-based RSUs | 1/25/2024 | - | - | - | - | 3,436 | 750,010 | | | Performance-based RSUs | 1/25/2024 | - | - | 3,436 | 6,013 | - | 750,010 |
2024 Grants of Plan-Based Awards Table
_________________ (1) These columns represent the target and maximum annual cash bonus opportunities under the Company’s annual cash bonus program for 2024. Refer to page 37 for discussion of the Company’s annual cash bonus program. Based on our financial performance in 2024, the NEOs earned 127% of the annual cash bonus target. The actual cash bonuses paid to the NEOs for 2024 are set forth in the Summary Compensation Table under the “Non-Equity Incentive Plan Compensation” column. (2) These columns represent the performance-based RSUs granted to the NEOs during 2024 pursuant to the Company’s 2020 Equity Incentive Plan, shown both at the target and maximum performance levels. Refer to page 39 for discussion of the Company’s Equity Incentive Plan. Based on our financial performance in 2024, the NEOs earned 127% of the granted performance-based RSUs, which vest in four equal annual installments commencing in the year following the date of grant. (3) This column represents service-based RSUs granted to the NEOs during 2024 under the company’s 2020 Equity Incentive Plan. This column represents the grant date fair value for performance-based and service-based RSU awards in accordance with ASC Topic 718. We determined these fair values based on the closing market price of the Company’s Common Stock on the date of grant.
2024 Grants of Plan-Based Awards Table
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2024 Outstanding Equity Awards at Fiscal Year-End
2024 Outstanding Equity Awards at Fiscal Year-End The following table summarizes the equity awards of our named executive officers outstanding as of December 31, 2024. We determined the market value of unvested stock awards based on the closing market price for our Common Stock of $270.24 per share on December 31, 2024.
2024 Outstanding Equity Awards at Fiscal Year-End
| Outstanding Equity Awards at Fiscal Year End | | | | | | | Stock Awards (1) | | | Name | Grant Date | Number of Shares or Stock Units That Have Not Vested (#) | Market Value of Shares or Stock Units That Have Not Vested ($) | | Eddie Capel | 1/28/2021 | 14,438 | 3,901,725 | | | 1/27/2022 | 27,708 | 7,487,810 | | | 1/27/2022 | 21,679(3) | 5,858,533 | | | 1/26/2023 | 65,085 | 17,588,570 | | | 1/25/2024 | 47,318(2) | 12,787,216 | | Dennis B. Story | 1/28/2021 | 4,413 | 1,192,569 | | | 1/27/2022 | 8,363 | 2,260,017 | | | 1/27/2022 | 21,679(3) | 5,858,533 | | | 1/26/2023 | 14,166 | 3,828,220 | | | 1/25/2024 | 10,140(2) | 2,740,234 | | Bruce S. Richards | 1/28/2021 | 1,598 | 431,844 | | | 1/27/2022 | 3,012 | 813,963 | | | 1/27/2022 | 6,505(3) | 1,757,911 | | | 1/26/2023 | 5,055 | 1,366,063 | | | 1/25/2024 | 3,640(2) | 983,674 | | Robert G. Howell | 1/28/2021 | 3,451 | 932,598 | | | 1/27/2022 | 6,929 | 1,872,493 | | | 1/27/2022 | 18,066(3) | 4,882,156 | | | 1/26/2023 | 11,487 | 3,104,247 | | | 1/25/2024 | 8,321(2) | 2,248,667 | | J. Stewart Gantt | 1/28/2021 | 2,608 | 704,786 | | | 1/27/2022 | 5,256 | 1,420,381 | | | 1/27/2022 | 18,066(3) | 4,882,156 | | | 1/26/2023 | 8,808 | 2,380,274 | | | 1/25/2024 | 7,800(2) | 2,107,872 |
2024 Outstanding Equity Awards at Fiscal Year-End
_________________ (1) RSU awards vest in accordance with the schedules set forth below. (2) These amounts represent, as of December 31, 2024, the sum of (i) outstanding RSUs that were service-based when granted, and (ii) outstanding RSUs that were performance-based when granted, which, as of December 31, 2024, were earned at 127% of target, based on the level of achievement of the applicable performance measures. In January 2022, our Compensation Committee approved a special retention grant of service-based RSUs to members of our executive team, including our NEOs. The Committee intended that grant, which vests over four years, to further motivate our dedicated and experienced executive team to remain with the Company to best ensure continued execution of our transition to a cloud-first Company. Those RSUs vest as follows, so long as the executive remains employed with the Company on the applicable vesting date: 10% in January 2024; 20% in January 2025; 30% in January 2026 and 40% in January 2027.
2024 Outstanding Equity Awards at Fiscal Year-End
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2024 Outstanding Equity Awards at Fiscal Year-End
| Stock Awards Vesting Schedule | | | | Name | Grant Date | Vesting | | Eddie Capel | 1/28/2021 | 25% per year for 4 years | | | 1/27/2022 | 25% per year for 4 years | | | 1/27/2022 | 10% in Jan. 2024; 20% in Jan. 2025; 30% in Jan. 2026; 40% in Jan. 2027 | | | 1/26/2023 | 25% per year for 4 years | | | 1/25/2024 | 25% per year for 4 years | | Dennis B. Story | 1/28/2021 | 25% per year for 4 years | | | 1/27/2022 | 25% per year for 4 years | | | 1/27/2022 | 10% in Jan. 2024; 20% in Jan. 2025; 30% in Jan. 2026; 40% in Jan. 2027 | | | 1/26/2023 | 25% per year for 4 years | | | 1/25/2024 | 25% per year for 4 years | | Bruce S. Richards | 1/28/2021 | 25% per year for 4 years | | | 1/27/2022 | 25% per year for 4 years | | | 1/27/2022 | 10% in Jan. 2024; 20% in Jan. 2025; 30% in Jan. 2026; 40% in Jan. 2027 | | | 1/26/2023 | 25% per year for 4 years | | | 1/25/2024 | 25% per year for 4 years | | Robert G. Howell | 1/28/2021 | 25% per year for 4 years | | | 1/27/2022 | 25% per year for 4 years | | | 1/27/2022 | 10% in Jan. 2024; 20% in Jan. 2025; 30% in Jan. 2026; 40% in Jan. 2027 | | | 1/26/2023 | 25% per year for 4 years | | | 1/25/2024 | 25% per year for 4 years | | J. Stewart Gantt | 1/28/2021 | 25% per year for 4 years | | | 1/27/2022 | 25% per year for 4 years | | | 1/27/2022 | 10% in Jan. 2024; 20% in Jan. 2025; 30% in Jan. 2026; 40% in Jan. 2027 | | | 1/26/2023 | 25% per year for 4 years | | | 1/25/2024 | 25% per year for 4 years |
2024 Stock Vested Table
2024 Stock Vested Table The following table provides information about the value realized by the named executive officers from their stock awards that vested during the year ended December 31, 2024.
2024 Stock Vested Table
| Stock Vested | | | | | Stock Awards | | | | Number of | Value | | | Shares Acquired | Realized on | | Name | on Vesting | Vesting | | Eddie Capel | 68,071 | 16,654,370 | | Dennis B. Story | 20,498 | 5,003,131 | | Bruce S. Richards | 7,239 | 1,766,996 | | Robert G. Howell | 16,480 | 4,022,634 | | J. Stewart Gantt | 13,012 | 3,175,534 |
2024 Stock Vested Table
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Potential Payments upon Termination of Employment
Potential Payments upon Termination of Employment Each NEO’s employment agreement provides that, if the Company terminates that officer’s employment for reasons other than death, disability, or “cause” (as defined in the agreement), or if the officer terminates their employment for “constructive termination” (as defined in the agreement), then the officer will be entitled to certain severance payments and benefits. (Mr. Capel’s agreement was amended effective February 2025 in conjunction with his departure from the President and Chief Executive Officer role as described above under “Executive Compensation—Compensation Discussion and Analysis—Compensation of our Chief Executive Officer.”) Those payments and benefits are described in footnote 1 to the following table, except that if the termination occurs within two years following a change in control of the Company (as defined in the agreement), those payments and benefits are as described in footnote 2 to the table. The following table shows the estimated amounts that would have been payable to our NEOs under their employment agreements if their termination of employment was effective as of December 31, 2024.
Potential Payments upon Termination of Employment
| | Cash Severance | Value of Accelerated Stock Vesting | Health Benefits | | Eddie Capel | | | | | Termination without cause or constructive termination(1) | $725,000 | $- | $53,777 | | Change in control with termination without cause or constructive termination(2) | 1,736,374 | 46,102,944 | 53,777 | | Dennis B. Story | | | | | Termination without cause or constructive termination(1) | 493,000 | - | 53,777 | | Change in control with termination without cause or constructive termination(2) | 1,023,100 | 15,553,663 | 53,777 | | Bruce S. Richards | | | | | Termination without cause or constructive termination(1) | 387,000 | - | 53,777 | | Change in control with termination without cause or constructive termination(2) | 716,220 | 5,236,440 | 53,777 | | Robert G. Howell | | | | | Termination without cause or constructive termination(1) | 410,000 | - | 53,777 | | Change in control with termination without cause or constructive termination(2) | 984,740 | 12,772,623 | 53,777 | | J. Stewart Gantt | | | | | Termination without cause or constructive termination(1) | 425,000 | - | 53,777 | | Change in control with termination without cause or constructive termination(2) | 913,250 | 11,244,686 | 53,777 |
Potential Payments upon Termination of Employment
_________________ (1) The employment agreement for each NEO provides that, if the Company terminates the executive’s employment other than for death, disability or “cause” (as defined in the agreement), or if there is a “constructive termination” of the executive officer’s employment (as defined in the agreement), then, subject to the executive’s delivery of a release of claims and ongoing compliance with the executive’s restrictive covenants and other post-termination obligations, the executive is entitled to receive ongoing payment of 12 months of their then-current base salary and 12 monthly payments of COBRA or its equivalent for the executive officer and their family’s medical and dental benefits, “grossed up” for income tax. (2) The employment agreement for each NEO provides that, if a termination of the executive’s employment occurs entitling the executive officer to receive the payments and benefits described in footnote 1 above, and that termination occurs within twenty-four months of a “change of control” of the Company (as defined in the agreement), then, in addition to the payments and benefits described in footnote 1 above, the executive is entitled to receive (i) a pro rata annual cash bonus for the year of termination through their termination date calculated at the target performance level (to the extent not yet paid), (ii) an annual cash bonus equal to the greater of that executive’s target bonus for the year of termination or the prior year, and (iii) vesting of all outstanding and unvested restricted stock unit awards. Performance-based restricted stock unit awards for which the performance period has not been completed as of the date of the change of control are deemed to have been achieved at the target performance level.
CEO Pay Ratio
CEO Pay Ratio As required by SEC rules, we provide the following information about the relationship of the annual total compensation of Eddie Capel, our Chief Executive Officer (our “CEO”), to the median annual total compensation of our employees: Our CEO to Median Employee pay ratio is approximately 81:1. We believe this is a reasonable estimate based on the assumptions and adjustments described below. We identified our employee with compensation at the median annual total compensation of all our employees (our “Median Employee”) by examining the total cash compensation during the calendar year 2024 (using December 31, 2024, as the “median employee determination date”), including salary or wages (including overtime), and any cash incentive compensation, paid in 2024, plus the value of any equity vesting during 2024 under our stock incentive plan, for each employee, excluding our CEO, whom we employed (including those of our consolidated subsidiaries) on December 31, 2024, whether on a full-time, part-time, seasonal, or temporary basis. For employees paid other than in U.S. dollars, we converted their compensation to U.S. dollars using the U.S. Department of the Treasury Reporting Rates of Exchange. For non-U.S. employees, we made cost-of-living adjustments using the applicable World Bank Price Level Ratio of Purchasing Power Parity Conversion Factor. For employees hired during 2024, we calculated their salary or wages as if they had been employed for all of 2024. Our total number of employees on December 31, 2024, including U.S. and non-U.S. employees, was approximately 4,690. We did not utilize the de minimus exemption to exclude any non-U.S. employees. After identifying our Median Employee, which was an employee based in India, we calculated their annual total compensation using our method for calculating our CEO’s compensation reported in the “Total” column of our 2024 Summary Compensation Table. As disclosed in our 2024 Summary Compensation Table, our CEO’s annual total compensation for 2024 was $10,789,675. Our Median Employee’s computed annual total compensation for 2024 was $133,968. The resulting ratio of our CEO’s annual total compensation to that of our Median Employee for 2024 is approximately 81:1. Had we not made any cost-of-living adjustments, our Median Employee would have been a lower compensated employee from Chile with a computed annual total compensation for 2024 of $83,330. The resulting ratio of our CEO’s annual total compensation to that of our Median Employee for 2024 would have been approximately 130:1.
CEO Pay Ratio
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Pay Versus Performance
Pay Versus Performance In accordance with SEC rules, the following table sets forth a comparison of compensation reported in the "Total" column of the Summary Compensation Table to compensation actually paid to our CEO and other NEOs as well as to certain measures of Company performance. The “Compensation Actually Paid” values provided in the new, SEC-required tables below do not reflect the actual compensation paid to the CEO or the other NEOs. Our Compensation Committee did not consider the Compensation Actually Paid in structuring or determining compensation for our NEOs. For a complete discussion of the Company’s executive compensation program and the Committee’s philosophy and approach, please refer to the CD&A section beginning on page 31.
Pay Versus Performance
| | | | | | Value of initial fixed $100 investment based on: | | | | | Year | Summary Compensation Table Total for CEO | Compensation Actually Paid to CEO | Average Summary Compensation Table Total for non-CEO NEOs | Average Compensation Actually Paid to Non-CEO NEOs | Total Shareholder Return | Peer Group Total Shareholder Return | Net Income ($mm) | Adjusted Operating Income ($mm) | | | | (a) | | (b) | | (c) | | (d) | | 2024 | $10,789,675 | $23,553,857 | $2,346,048 | $5,254,817 | $339 | $301 | $218 | $362 | | 2023 | 10,363,456 | 31,879,143 | 2,258,451 | 7,485,480 | 270 | 221 | 177 | 281 | | 2022 | 10,428,809 | 4,837,225 | 3,569,936 | 2,147,827 | 152 | 133 | 129 | 212 | | 2021 | 7,074,692 | 19,787,903 | 1,677,042 | 4,696,029 | 195 | 207 | 110 | 178 | | 2020 | 6,514,042 | 12,630,689 | 1,528,875 | 3,172,451 | 132 | 150 | 87 | 148 |
Pay Versus Performance
(a) The following table sets forth a reconciliation from the "Total" column of the Summary Compensation Table (SCT) to the "Compensation Actually Paid" to our CEO during the applicable year. "Compensation Actually Paid" is calculated in accordance with the rules of the SEC and may not reflect the actual amount of compensation earned by or paid to the CEO during the applicable year. Mr. Eddie Capel was CEO for all years presented and until February 12, 2025.
Pay Versus Performance
| | | | Equity Addition to SCT Total | | | | | Year | SCT Total | Less Equity Deduction from SCT | Value of Current Year Equity Awards at Dec 31 value | Change in value of unvested prior year awards at Dec 31 | Change in value of prior year awards vested in current year | Total Compensation Actually Paid | | | | (e) | (f) | (g) | (h) | (i) | | 2024 | $10,789,675 | ($9,100,094) | $12,787,216 | $7,079,737 | $1,997,323 | $23,553,857 | | 2023 | 10,363,456 | (8,500,111) | 18,684,824 | 10,350,359 | 980,615 | 31,879,143 | | 2022 | 10,428,809 | (8,800,080) | 9,651,664 | (4,368,293) | (2,074,875) | 4,837,225 | | 2021 | 7,074,692 | (5,500,823) | 9,183,395 | 8,299,792 | 730,847 | 19,787,903 | | 2020 | 6,514,042 | (5,295,282) | 6,595,733 | 4,659,412 | 156,784 | 12,630,689 |
Pay Versus Performance
(b) The following table sets forth a reconciliation from an average of the amounts under the “Total” column of the SCT to average “Compensation Actually Paid” to our NEOs, excluding the CEO. “Compensation Actually Paid” is calculated in accordance with the rules of the SEC and may not reflect the actual amount of compensation earned by or paid to the NEOs during the applicable year. For 2020 through 2022, the non-CEO NEOs included in the average are Messrs. Dennis B. Story, Bruce S. Richards and Robert G. Howell and Ms. Linda C. Pinne. For 2023 and 2024, the non-CEO NEOs included in the average are Messrs. Dennis B. Story, Bruce S. Richards and Robert G. Howell and Mr. J. Stewart Gantt.
Pay Versus Performance
| | | | Equity Addition to SCT Total | | | | | Year | SCT Average | Less Equity Deduction from SCT | Value of Current Year Equity Awards at Dec 31 value | Change in value of unvested prior year awards at Dec 31 | Change in value of prior year awards vested in current year | Average Compensation Actually Paid | | | | (e) | (f) | (g) | (h) | (i) | | 2024 | $2,346,048 | ($1,437,592) | $2,020,112 | $1,914,813 | $411,436 | $5,254,817 | | 2023 | 2,258,451 | (1,290,041) | 2,835,818 | 3,381,355 | 299,897 | 7,485,480 | | 2022 | 3,569,936 | (2,826,382) | 2,947,289 | (1,020,348) | (522,668) | 2,147,827 | | 2021 | 1,677,042 | (960,887) | 1,602,052 | 2,203,063 | 174,759 | 4,696,029 | | 2020 | 1,528,875 | (917,895) | 1,143,280 | 1,345,934 | 72,257 | 3,172,451 |
Pay Versus Performance
(c) Based on the NASDAQ Computer Index included in our stock performance graph in our annual report to shareholders.
Pay Versus Performance
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Pay Versus Performance
(d) Adjusted operating income (AOI) is a non-GAAP financial measure defined as operating income excluding the impact of equity-based compensation, acquisition-related costs, and an unusual health insurance claim, and the related income tax effects of these items. This measure is the same AOI measure we use to partially calculate our annual performance-based cash bonus and our performance-based RSUs discussed in the CD&A and the compensation tables, except for compensation purposes we adjust AOI to constant currency at budgeted rates. (e) Represents the grant date fair value of equity-based awards made during each fiscal year. (f) Represents the year-end fair value of equity-based awards that were made during the fiscal year, including actual performance units earned that were granted during the fiscal year. (g) Represents the change in fair value during the fiscal year of equity-based awards granted in prior fiscal years that were still unvested as of year-end, with such change in fair value reflecting the change in the year-end stock price during each year. (h) Represents the change in fair value during the fiscal year of equity-based awards granted in prior fiscal years that vested during the year, with such change in fair value reflecting the change in stock price from the prior fiscal year-end until the vesting date. The 2020 amounts include the value of stock units granted on July 27, 2015 that vested in January 2020. The 2020 amounts do not include the value of stock units from that same July 27, 2015 grant that vested prior to 2020 but were not settled until January 2020. (i) The amounts in this column are calculated by subtracting the amounts under “Less Equity Deduction from SCT” from, and adding the amounts under “Value of Current Year Equity Awards as of Dec 31 value”, “Change in value of unvested prior year awards at Dec 31” and “Change in value of prior year awards vested in current year” to, the amounts under “SCT Total” with respect to the CEO and “SCT Average” with respect to the other NEOs.
Analysis of the Information Presented in the Pay versus Performance Table
Analysis of the Information Presented in the Pay versus Performance Table As demonstrated by the following table, the amount of Compensation Actually Paid to our CEO is aligned with our cumulative total shareholder return (TSR) over the three years presented in the table. The alignment of Compensation Actually Paid with the Company’s cumulative TSR over the period presented is because a significant portion of the Compensation Actually Paid to our CEO is comprised of equity awards.
Analysis of the Information Presented in the Pay versus Performance Table
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Analysis of the Information Presented in the Pay versus Performance Table
| Relationships between Pay and Performance | | | | | | | | 2020 | 2021 | 2022 | 2023 | 2024 | | CEO Compensation Actually Paid (in millions) | $12.6 | $19.8 | $4.8 | $31.9 | $23.6 | | Average NEO Compensation Actually Paid (in millions) | $3.2 | $4.7 | $2.1 | $7.5 | $5.3 | | Company Net Income (in millions) | $87 | $110 | $129 | $177 | $218 | | % Yearly Change | | 26% | 17% | 37% | 23% | | Company Adjusted Operating Income (in millions) | $148 | $178 | $212 | $281 | $362 | | % Yearly Return | | 20% | 19% | 33% | 29% | | Company Total Shareholder Return | $132 | $195 | $152 | $270 | $339 | | % Yearly Return | 32% | 48% | -22% | 77% | 25% | | 3 year CAGR | | | 15% | 27% | 20% | | Peer Total Shareholder Return | $150 | $207 | $133 | $221 | $301 | | % Yearly Return | 50% | 38% | -36% | 66% | 36% | | 3 year CAGR | | | 10% | 14% | 13% |
Analysis of the Information Presented in the Pay versus Performance Table
As further discussed in our Compensation Discussion and Analysis, annual equity grants are made to officers in the form of service-based RSUs and PSUs each year around the end of January. Such grants vest pro-rata (25% per year) on January 31 of subsequent years, except the first tranche of each PSU grant vests on February 28 of the year following grants after the number of PSUs earned based on performance results is determined and certified by the Compensation Committee. Earned awards under the annual bonus plan and PSUs were based on financial performance results achieved as compared to pre-established goals. Those awards were earned at 108% of target for 2020, 150% of target for 2021, 138% of target for 2022, 158% of target for 2023, and 127% of target for 2024. We believe the measures used in the cash bonus and PSU grants for the CEO and other NEOs, including adjusted operating income, are key drivers of long-term shareholder value creation. Special retention equity grants of service-based RSUs have been made periodically, including in 2019 and 2022 for the CEO and NEOs. For the stock unit grants made in 2019, 10% vested in 2020, 20% vested in 2021, 30% vested in 2022, and 40% vested in 2023. For the stock unit grants made in 2022, 10% vested in 2024, 20% vest in 2025, 30% vest in 2026, and 40% vest in 2027. The increase in total compensation values as reported in the Summary Compensation Table for 2022 reflect that special retention equity grants were made to the CEO and other NEOs during 2022, but no similar grants were made during 2021 or 2020. Even though the stock units from those special grants are expected to vest from 2024-2027, the entire grant fair value must be reported in the Summary Compensation Total for the CEO and other NEOs. Because a majority of total compensation provided to the CEO and the average NEO is through equity-based grants that vest over multi-year periods, the primary driver of changes in "Compensation Actually Paid" totals for the CEO and average NEO is the change in Company stock price. Our stock price increased 32% during 2020, 48% during 2021, 77% during 2023, and 26% during 2024, with those stock price increases resulting in higher “Compensation Actually Paid” values for the CEO and average NEO in each of those years. During 2022, our stock price declined by 22% compared to a return of -33% for the NASDAQ Composite and -36% for the NASDAQ Computer Index. We closed 2022 posting our second consecutive year of record revenue and earnings. However, our stock price change resulted in 2022 “Compensation Actually Paid” values for the CEO and average NEO that were lower than those values in the previous two years. With the emphasis on equity-based grants that vest over multi-year periods for the CEO and other NEOs, including annual grants and periodic special retention grants, the Compensation Committee believes that compensation value actually realized by the Company’s officers is directly and strongly aligned with shareholder returns over a multi-year period.
Analysis of the Information Presented in the Pay versus Performance Table
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