DEF 14A of Monster Beverage Corp, Apr 26, 2024

DEF 14A of Monster Beverage Corp

Filed Apr 26, 2024 · FY20230001104659-24-053090

Open on EDGAR

  1. ELECTION OF DIRECTORS

    ELECTION OF DIRECTORS

  2. Executive Summary

    Executive Summary The Company entered into fiscal year 2023 with inflation and geopolitical conflict remaining at an elevated level. Despite these constraints on the worldwide food and beverage and consumer products industry and society at large, the Company’s financial performance demonstrated continued growth and strength during 2023, including through its successful integration of the Bang Energy® drink business and beverage production facility in Phoenix, Arizona. Net sales increased primarily due to increased worldwide sales by volume of the Company’s Monster Energy® brand energy drinks as a result of increased consumer demand as well as due to pricing actions including price increases and decreased promotional allowances as a percentage of net sales in certain markets. Specifically, net sales rose to $7.14 billion, up 13.1% from 2022. Moreover, the Company successfully increased net income from $1.19 billion in fiscal year 2022 to $1.63 billion, or 36.9%, in 2023. Finally, the Company’s four-year total shareholder return (“TSR”) performance increased to 81.3%. In 2023, we continued the implementation of our revamped executive compensation program introduced in 2020, which is more formulaic and objective in nature than our historical, more discretionary approach to the program. Each of our NEOs once again had a pre-established target bonus opportunity as part of our annual incentive award (“AIA”) program for short-term annual incentive compensation. Our NEOs’ target AIAs were earned based on pre-established financial criteria and individual performance criteria, weighted 75% and 25%, respectively. In addition to the AIAs, consistent with our revamping in 2020, the Compensation Committee approved grants of performance share units (“PSUs”), together with time-vested stock options and time-vested restricted stock units (“RSUs”) to all of our NEOs. The PSUs granted in 2023 (“2023 PSUs”) represented a range from 39% to 50% of the NEO annual long-term incentive (“LTI”) grant value in 2023 and will be eligible to be earned based on the Company’s three-year cumulative adjusted diluted earnings per share (“EPS”) from 2023 through 2025 (i.e., one single, three-year performance period). Consistent with our strong performance during 2023, the financial performance component of the AIAs for the year was earned at 200% of target based on the Company’s adjusted operating income exceeding the maximum performance goals and the individual performance component of the AIAs was certified by the Compensation Committee at 100% of target for each of our NEOs, for overall payouts of approximately 175% of each NEO’s applicable target AIA opportunity. Additionally, the 2021 PSU grants with a three-year measurement period beginning on January 1, 2021 and ending on December 31, 2023 were earned at 131% of target in connection with three-year cumulative adjusted diluted EPS during such measurement period falling between the pre-established target and maximum performance goal.

  3. Setting Executive Compensation for 2023

    Setting Executive Compensation for 2023 The compensation programs for our NEOs are generally administered by or under the direction of the Compensation Committee (in the case of Rodney C. Sacks, the Chairman and Co-Chief Executive Officer, and Hilton H. Schlosberg, the Vice Chairman and Co-Chief Executive Officer) and, in the case of the other NEOs, by our Compensation Committee, based on the recommendation of the Executive Committee. The compensation program for all NEOs is benchmarked annually by the Compensation Committee’s independent consultant to help inform the Compensation Committee that target compensation levels are competitive and reasonable and continue to achieve the goals set forth in our compensation philosophy. In reviewing the compensation for Mr. Sacks and Mr. Schlosberg, the Compensation Committee recognizes that Mr. Sacks and Mr. Schlosberg serve as our co-leaders. Given the long-term complementary nature of their leadership and their contributions to our success, the Compensation Committee has historically determined and continues to determine it is appropriate to compensate them equally. For 2023 compensation decisions, the Compensation Committee again retained F.W. Cook to provide competitive market data and make recommendations to the Compensation Committee with respect to compensation for Mr. Sacks and Mr. Schlosberg and to both the Compensation Committee and Executive Committee with respect to compensation for our other NEOs and senior management. F.W. Cook reports directly to the Compensation Committee and did not perform any other services for the Company in 2023. Following an independence assessment of F.W. Cook during 2023, the Compensation Committee determined that the services provided by F.W. Cook did not raise any conflicts of interest. The Compensation Committee does not set compensation at a targeted percentile level relative to the market, but we do seek to provide salary, incentive compensation opportunities and employee benefits that are largely competitive within the consumer products industry, the food and beverage industry and within the labor markets in which we participate. Within this framework, we generally seek to keep target cash compensation levels below median for Mr. Sacks and Mr. Schlosberg, with equity awards providing enhanced compensation opportunities. We gather market compensation data to provide context, but we also consider Company and individual performance, as well as our recruiting and internal retention experience when making executive compensation decisions. The Compensation Committee consulted with F.W. Cook in early 2023 to conduct a 2023 competitive market analysis (the “Early 2023 Market Analysis”) using a comparison group of similarly sized, high-performing U.S. food and beverage and consumer products companies (the “2023 Peers”). As market compensation levels are correlated to revenues for cash compensation and market capitalization for equity compensation, the Compensation Committee selects its peer companies using objective size criteria for each metric. Relative to the 2023 Peers, in early 2023, revenue was below the median, operating income was between the median and 75th percentile, and market capitalization approximated the 70th percentile. The 2023 Peers were the same as the peers referenced for 2022 compensation, other than the removal of Peloton Interactive, Inc., PVH Corp. and Under Armour, Inc. and the addition of Mondelez International, Inc. The resulting 2023 Peers composed of 16 companies are shown below:

  4. Setting Executive Compensation for 2023

    The Early 2023 Market Analysis was considered in determining the NEOs’ 2023 base salaries, target AIA opportunities and equity award grant values. In November 2023, subsequent to F.W. Cook’s review of the 2023 Peers, F.W. Cook determined that the companies consisting of the 2023 Peers continued to be reasonable on the basis of size, with the Company’s lower-quartile revenue balanced by near median operating income and upper quartile market capitalization. Accordingly, no changes were made to the Company’s peer group and compensation and performance data of the 2023 Peers was considered in determining compensation for the 2024 performance year. Taking into consideration the Early 2023 Market Analysis, the Compensation Committee set Mr. Sacks’s and Mr. Schlosberg’s 2023 target cash compensation below the median of the 2023 Peers and granted them above-median equity compensation in order to align their interests over the long-term with those of our stockholders. The Early 2023 Market Analysis noted that the performance of the Company was above the peer 75th percentile in revenue growth (88th percentile), below the median on EPS growth (28th percentile) and near the 75th percentile for return on invested capital (72nd percentile). This level of operating performance was considered significant by the Compensation Committee and informed its determination of the target total compensation of Mr. Sacks and Mr. Schlosberg above the 2023 Peers’ 75th percentile. The peer group data serves as only one reference point used by us when making compensation decisions. However, we generally believe that reviewing and analyzing such pay and performance information is an important component of our executive compensation decision-making process. The 2023 awards of stock options, RSUs and PSUs granted to Mr. Sacks and Mr. Schlosberg are consistent with our annual grant philosophy and serve to reward them for the Company’s continued growth in key performance criteria in 2023 and further align their interests with our stockholders. Recent equity awards granted to Mr. Sacks and Mr. Schlosberg vest over a three-year period, in each case, per the terms of their respective stock option, RSU and PSU award agreements. For 2023, the decisions to increase base salaries for each of Mr. Kelly, Mr. Carling and Ms. Tirre were informed by F.W. Cook’s senior executive benchmarking analysis and individual performance. Specifically, F.W. Cook’s senior executive benchmarking analysis was used for guidance in determining the total compensation for Mr. Kelly, Mr. Carling and Ms. Tirre, which included specified performance targets for their respective AIAs. The compensation levels for Mr. Kelly, Mr. Carling and Ms. Tirre were generally set relative to the market data in F.W. Cook’s senior executive benchmarking analysis with near-median long-term equity compensation value provided in aggregate through stock options, RSUs and PSUs, in order to emphasize the Company’s commitment to continued stockholder growth and to recognize that long-term equity compensation has been an effective incentive for motivating performance, and annual cash compensation that is comparable to the compensation received by similarly-situated individuals employed by the 2023 Peers. Recent equity awards granted to Mr. Kelly vest over a three-year period and recent stock option and RSU awards granted to Mr. Carling and Ms. Tirre generally vest over a three- or five-year period (and in respect of PSU awards, a three-year period), in each case, per the terms of their respective stock option, RSU and PSU award agreements. We view all components of compensation as related but distinct. We determine the appropriate level for each compensation component, based in part, but not exclusively, on competitive benchmarks gathered through our recruitment and retention experience, market data such as the Early 2023 Market Analysis discussed above, and our review of internal comparatives as well as other considerations we deem relevant, such as individual and corporate performance. We believe that equity awards effectively reward for long-term performance and are an important compensation-related motivator to attract and retain executives through the various vesting periods and through the achievement of applicable performance thresholds. In addition, we believe equity awards allow executives to share in the value that they help create. Except as described in this proxy statement, neither our Compensation Committee nor our Executive Committee has adopted any formal or informal policies or guidelines for allocating compensation between short-term and long-term and current compensation between cash and non-cash compensation. However, our Compensation Committee and Executive Committee’s respective philosophy is that a greater percentage of our NEOs’ compensation should be rewarded in long-term equity rather than short-term cash, and we believe that this philosophy has benefited our long-term performance by attracting, retaining and motivating a long-tenured NEO group that has built significant long-term value for our stockholders. Compensation packages for each of our NEOs are tailored to each individual NEO’s circumstances by the Compensation Committee and/or the Executive Committee, as appropriate. Those decisions are largely based on subjective evaluations of Company and individual performance, with consideration given to compensation of comparable officers at companies who are in our peer group. Each element of compensation is determined differently for each individual NEO, based on a variety of facts and circumstances applicable at the time and specific to that NEO. Our Compensation Committee and Executive Committee perform an annual strategic review of LTI compensation paid to our NEOs to determine whether the Company has provided effective incentives and motivation to such NEOs, and whether the Company adequately compensates our NEOs relative to comparable officers in other companies with which we compete for executives. For decisions regarding the grant of equity compensation relating to NEOs, other than our Chairman and Co-Chief Executive Officer and our Vice Chairman and Co-Chief Executive Officer, the Compensation Committee specifically considers recommendations from the Executive Committee.

  5. 2023 AIAs

    Payouts were eligible to range from 0% to 200% of the applicable target performance criteria, with no payout earned for performance below a threshold level. In developing the performance goals for the AIAs granted in 2023, the Compensation Committee worked with F.W. Cook to develop a target goal that represented a meaningful level of growth relative to prior year performance with sufficient rigor to be challenging, but possible, to achieve. Adjusted operating income was maintained as the primary performance criteria in fiscal year 2023 because we believe it is an appropriate measurement for management’s contributions to operating performance and profitability of the Company. The adjustments to operating income allow evaluation of performance but exclude certain gains and charges which can distort operating income. For further information on the adjusted operating income compensation performance measure, which is a non-GAAP financial measure, see Appendix A. Achievement under either the adjusted operating income or the individual performance component of AIAs are independent of each other (i.e., a payout can be made under one component even if no payout is made under the other) and consistent with past practice, payout of AIAs can be made in the form of cash, shares of our Common Stock or a combination of cash and shares of our Common Stock at the Compensation Committee’s discretion, and equal to the weighted sum of the achievement for each applicable performance metric. Linear interpolation is applied to calculate the actual percentage payout for achievement of the adjusted operating income component between threshold, target, and maximum performance levels.

  6. 2023 LTI Program

    2023 LTI Program We believe that long-term performance is achieved through an ownership culture that encourages superior performance by our NEOs through the use of equity awards and, as a result, the compensation program emphasizes equity awards over cash compensation. The Compensation Committee reviews and approves equity awards to our NEOs based upon compensation data principally gathered through a market analysis conducted by our independent compensation consultants, our recruiting and retention experience and our qualitative assessment of individual performance, as well as a review of each NEO’s current LTI award opportunities and retention considerations. The Compensation Committee, with the assistance of F.W. Cook, revised the LTI program in 2020 to introduce PSUs as part of the overall award mix. The Compensation Committee believes that the move to include PSUs as part of the LTI pay mix continues to align the NEO’s compensation with long-term growth and objectives. With respect to 2023, the Compensation Committee determined that the March 2023 LTI grants to Mr. Sacks and Mr. Schlosberg would be split among time-vested stock options (25% weighting), time-vested RSUs (25% weighting), PSUs (50% weighting) and that the March 2023 LTI grants to Mr. Kelly, Mr. Carling and Ms. Tirre would be split among time-vested stock options (approximately 42% weighting), time-vested RSUs (approximately 19% weighting) and PSUs (approximately 39% weighting). The weighting for Mr. Kelly, Mr. Carling and Ms. Tirre was slightly different due to the grant of one-time retention awards to such individuals.

  7. PSUs

    PSUs Following the Compensation Committee’s introduction of PSUs as part of the overall award mix in 2020, 2023 continued the practice from fiscal years 2021 and 2022 of granting PSUs that cliff vest over a single three-year performance period, subject to pre-established performance goals and continued service during the period. The Compensation Committee believes that a three-year performance period for grants of PSUs continues to align the NEOs’ compensation with long-term growth and objectives. Specifically, the 2023 grants of PSUs are eligible to be earned based on three-year cumulative adjusted diluted EPS from fiscal year 2023 through fiscal year 2025. The number of PSUs that may be earned range from 0% to 200% of target versus the pre-established performance goals, with threshold, target and maximum performance levels earning 50%, 100% and 200% of target PSUs, respectively, as set forth in the table below (linear interpolation applies between performance levels).

  8. PSUs

    | Name | Performance Period | Threshold Shares (50% of Target) (#) | Target Shares (100% of Target) (#) | Maximum Shares (200% of Target) (#) | | Rodney C. Sacks | 2023 – 2025 | 67,600 | 135,200 | 270,400 | | Hilton H. Schlosberg | 2023 – 2025 | 67,600 | 135,200 | 270,400 | | Thomas J. Kelly | 2023 – 2025 | 3,400 | 6,800 | 13,600 | | Guy P. Carling | 2023 – 2025 | 6,800 | 13,600 | 27,200 | | Emelie C. Tirre | 2023 – 2025 | 6,800 | 13,600 | 27,200 |

  9. PSUs

    For the 2021 PSU grants, relating to the performance period beginning on January 1, 2021 and ending on December 31, 2023, the pre-established threshold, target and maximum performance levels are set forth in the table below (linear interpolation applies between threshold/target and target/maximum performance goals with no payout for performance below threshold).

  10. PSUs

    | Performance Goal (Performance Percentage) | Three-Year Cumulative Adjusted Diluted EPS for 2021 – 2023 | | Threshold (50% of Target) | $3.874 | | Target (100% of Target) | $4.078 | | Maximum (200% of Target) | $4.282 |

  11. PSUs

    With the completion of the vesting period for the 2021 PSU grants, the Compensation Committee considered the three-year cumulative adjusted diluted EPS from 2021 through 2023 of $4.142 and awarded the NEOs the following number of shares of Common Stock based on 131% achievement, as set forth in the table below. For a reconciliation of adjusted diluted EPS to diluted EPS, the most directly comparable GAAP financial measure, see Appendix A.

  12. PSUs

    | Name | Target Shares Deliverable Based on Award Achievement (100% of Target) (#) | Actual Shares Delivered Based on Award Achievement (#) | | Rodney C. Sacks | 151,800 | 198,858 | | Hilton H. Schlosberg | 151,800 | 198,858 | | Thomas J. Kelly | 5,600 | 7,336 | | Guy P. Carling | 11,200 | 14,672 | | Emelie C. Tirre | 11,200 | 14,672 |

  13. Stock Options and RSUs

    Stock Options and RSUs In addition to the PSUs, each of Mr. Sacks and Mr. Schlosberg were granted 183,000 stock options under the 2020 Omnibus Incentive Plan that vest in three equal one-third annual installments starting on March 14, 2024, subject to their continued employment through each vesting date. Additionally, on the same day, each of Mr. Sacks and Mr. Schlosberg were granted 67,600 RSUs under the 2020 Omnibus Incentive Plan that vest in three annual installments as follows: 22,532 units on March 14, 2024, 22,534 units on March 14, 2025 and 22,534 units on March 14, 2026, in each case, subject to their continued employment through each vesting date. These grants, taken together with PSU grants, represented an aggregate annual grant value of approximately $13.7 million, an increase of $0.1 million from fiscal year 2022. Mr. Kelly was granted 10,000 stock options under the 2020 Omnibus Incentive Plan that vest in three annual installments as follows: the option to purchase 3,332 shares on March 14, 2024, the option to purchase 3,334 shares on March 14, 2025 and the option to purchase 3,334 shares on March 14, 2026 and Mr. Carling and Ms. Tirre were each granted 20,000 stock options under the 2020 Omnibus Incentive Plan that vest in five annual installments as follows: the option to purchase 2,000 shares on March 14, 2024, the option to purchase 3,000 shares on March 14, 2025, the option to purchase 4,000 shares on March 14, 2026, the option to purchase 5,000 shares on March 14, 2027, and the option to purchase 6,000 shares on March 14, 2028, in each case, subject to their continued employment through each vesting date. Additionally, on the same day, Mr. Kelly was granted 3,400 RSUs that vest in three annual installments as follows: 1,132 units on March 14, 2024, 1,134 units on March 14, 2025, and 1,134 units on March 14, 2026 and Mr. Carling and Ms. Tirre were each granted 6,800 RSUs that vest in five annual installments as follows: 680 units on March 14, 2024, 1,020 units on March 14, 2025, 1,360 units on March 14, 2026, 1,700 units on March 14, 2027, and 2,040 units on March 14, 2028, in each case, subject to their continued employment through each vesting date. Further, in March 2023, the Compensation Committee approved additional grants of stock options to Mr. Kelly, Mr. Carling and Ms. Tirre as a one-time retention incentive award. Mr. Kelly was granted 10,000 stock options under the 2020 Omnibus Incentive Plan that vest in three annual installments as follows: the option to purchase 3,332 shares on March 14, 2024, the option to purchase 3,334 shares on March 14, 2025 and the option to purchase 3,334 shares on March 14, 2026 and Mr. Carling and Ms. Tirre were each granted 20,000 stock options under the 2020 Omnibus Incentive Plan that vest in three annual installments as follows: the option to purchase 6,666 shares on March 14, 2024, the option to purchase 6,666 shares on March 14, 2025, and the option to purchase 6,668 shares on March 14, 2026, in each case, subject to their continued employment through each vesting date.

  14. Employment Agreements

    Employment Agreements Certain NEOs who are parties to employment agreements will continue to be subject to such agreements in their current form based on the terms of such agreements, or upon renewal should the Compensation Committee determine in its discretion that revisions to such employment agreements are recommended. We believe that having employment agreements with Mr. Sacks and Mr. Schlosberg is beneficial to us because it provides retentive value and subjects each of them to restrictive covenants. For a summary description of the terms of these agreements, see “Narrative to 2023 Summary Compensation Table and 2023 Grants of Plan-Based Awards Table – Employment Agreements and Arrangements” below.

  15. Equity Grant Procedures

    Equity Grant Procedures The Compensation Committee maintains equity grant procedures, which set forth, among other things, the authorities of the Compensation Committee and Executive Committee to make grants under the 2020 Omnibus Incentive Plan under certain circumstances and the timing of our grants of equity awards. Under the equity grant procedures, other than awards granted to new hires and promotions, awards may only be granted during an applicable window period.

  16. Change in Control and Separation Arrangements

    Change in Control and Separation Arrangements Certain of our NEOs, per the terms of their respective employment agreements and/or equity award agreements, are eligible for certain benefits and/or payments if there is a change in control and/or a termination of their employment, as described under “Potential Payments Upon Termination or Change in Control” beginning on page 39. Beginning with the Company’s 2021 LTI grants and continuing through the 2023 LTI grants, the award agreements for each of the PSUs, time-vested RSUs and stock options provide for “double-trigger” vesting provisions for all NEOs, which accelerates vesting upon a qualifying termination of employment following the occurrence of a change in control where such awards are assumed, replaced or continued. Upon a change in control where such awards are assumed, replaced or continued, the PSUs will automatically convert into time-vested RSUs, with vesting occurring on the original vesting date applicable to such PSUs; provided that such converted time-vested RSUs will automatically accelerate upon a subsequent qualifying termination of employment. The number of time-vested RSUs that a portion of the PSUs could convert to depends on the timing of a change in control. If a change in control had occurred during the first year of the three-year performance period, the number of shares of Common Stock underlying the RSUs to be delivered would have been based on the number of shares of Common Stock deliverable at target performance (as outlined in the applicable award agreement). If a change in control occurs during the second or third year of the three-year performance period, the number of shares of Common Stock underlying the RSUs to be delivered will be based on the number of shares of Common Stock deliverable at actual performance for the portion of the performance period that ended before the change in control (as outlined in the applicable award agreement). Upon a change in control where time-vested RSU and stock option awards are assumed, replaced or continued, each of the time-vested RSU and stock option awards will automatically accelerate upon a subsequent qualifying termination of employment. We believe these arrangements are an important part of overall compensation and will help to secure the continued employment and dedication of our NEOs prior to or following a change in control, notwithstanding any concern that they may have at such time regarding their own future and continued employment. In addition, we believe that these arrangements are an important recruitment and retention incentive. These arrangements do not provide for tax gross ups.

  17. 2023 Summary Compensation Table

    2023 Summary Compensation Table The following table summarizes the total compensation of our NEOs during the fiscal years ended December 31, 2023, 2022 and 2021.

  18. 2023 Summary Compensation Table

    | Name and Principal Position | Year | Salary ($) | Bonus ($)(1) | Stock Awards ($)(2) | Option Awards ($)(3) | Non-Equity Incentive Plan Compensation ($)(4) | All Other Compensation ($)(5) | Total ($) | | Rodney C. Sacks Chairman, Co-CEO and Director | 2023 | 1,100,000 | - | 10,306,296 | 3,440,363 | 2,887,500 | 141,323 | 17,875,482 | | | 2022 | 1,000,000 | - | 10,127,709 | 3,435,577 | 750,000 | 103,798 | 15,417,084 | | | 2021 | 950,000 | - | 10,121,372 | 3,407,849 | 2,130,685 | 97,671 | 16,707,577 | | Hilton H. Schlosberg Vice Chairman, Co-CEO and Director | 2023 | 1,100,000 | - | 10,306,296 | 3,440,363 | 2,887,500 | 71,749 | 17,805,908 | | | 2022 | 1,000,000 | - | 10,127,709 | 3,435,577 | 750,000 | 81,114 | 15,394,400 | | | 2021 | 950,000 | - | 10,121,372 | 3,407,849 | 2,130,685 | 76,622 | 16,686,528 | | Thomas J. Kelly Chief Financial Officer | 2023 2022 2021 | 610,000 575,000 525,000 | - 250,000 - | 518,364 659,070 373,548 | 375,996 235,798 131,172 | 800,625 143,750 392,438 | 46,104 42,312 40,682 | 2,351,089 1,905,930 1,462,840 | | Guy P. Carling President, EMEA (6) | 2023 2022 2021 | 706,919 662,307 681,543 | - 299,323 - | 1,036,728 1,493,892 747,096 | 751,992 542,335 262,344 | 918,848 165,563 514,511 | 51,521 51,500 54,764 | 3,466,008 3,214,920 2,260,258 | | Emelie C. Tirre President, Americas | 2023 2022 2021 | 820,000 770,000 725,000 | - 350,000 - | 1,036,728 1,493,892 747,096 | 751,992 542,335 262,344 | 1,076,250 192,500 541,938 | 45,834 43,047 39,701 | 3,730,804 3,391,774 2,316,079 |

  19. 2023 Summary Compensation Table

    | (1) The amounts in this column represent for 2022 the amount earned as one-time recognition bonuses and paid in 2023. |

  20. 2023 Summary Compensation Table

    | (2) As computed in accordance with Accounting Standards Codification (“ASC”) Topic 718, modified to exclude the effect of estimated forfeitures related to service-based vesting conditions, the amounts in this column represent the aggregate grant date fair value of awards of shares of our Common Stock (solely in the case of Messrs. Sacks and Schlosberg, which amounts represent half of the amount earned in 2021 for their respective AIAs granted under the |

  21. 2023 Summary Compensation Table

    2020 Omnibus Incentive Plan and paid in 2022) and RSUs (in the case of all NEOs, which were granted in 2023, 2022 and 2021, respectively) and, with respect to awards of PSUs (in the case of all NEOs, which were granted in 2023, 2022 and 2021, respectively), represent the grant date fair value based on the probable outcome of the performance conditions at the date of grant. The amount reflected in this column with respect to the PSUs granted in 2023 is: Mr. Sacks, $6,870,864; Mr. Schlosberg, $6,870,864; Mr. Kelly, $345,576; Mr. Carling, $691,152; and Ms. Tirre, $691,152. The assumptions used in the valuation of equity awards are disclosed in Note 16 to the Audited Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. The amounts do not reflect the value actually realized or that ultimately may be realized by the NEOs. The value of the PSU awards granted in 2023, assuming achievement of the maximum performance level of 200%, would have been: Mr. Sacks, $13,741,728; Mr. Schlosberg, $13,741,728; Mr. Kelly, $691,152; Mr. Carling, $1,382,304; and Ms. Tirre, $1,382,304.

  22. 2023 Summary Compensation Table

    | (3) The amounts represent the aggregate grant date fair value for option awards computed in accordance with ASC Topic 718, modified to exclude the effect of estimated forfeitures related to service-based vesting conditions, and are based on the estimated fair value of the options on the date of grant using the Black-Scholes-Merton option pricing formula assumptions disclosed in Note 16 to the Audited Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. The amounts do not reflect the value actually realized or that ultimately may be realized by the NEOs. |

  23. 2023 Summary Compensation Table

    | (4) The amounts in this column represent for 2023 the amount earned for AIAs granted under the 2020 Omnibus Incentive Plan and paid in 2024. See “Compensation Discussion and Analysis – 2023 AIAs” for a discussion of how the 2023 AIAs were determined. |

  24. 2023 Summary Compensation Table

    | (5) The amounts reported in this column for 2023 include the items set forth in the table below, as applicable to each NEO: |

  25. 2023 Summary Compensation Table

    | Name | Company Automobile ($) | Automobile Allowance ($) | 401(k) Matching Contribution ($) | Benefit Premiums ($)(a) | Other Perquisites ($)(b) | Personal Equipment Allowance ($) | Total ($) | | Rodney C. Sacks | 48,882 | - | 13,163 | 75,886 | 2,794 | 598 | 141,323 | | Hilton H. Schlosberg | 22,996 | - | 13,200 | 34,955 | - | 598 | 71,749 | | Thomas J. Kelly | - | 9,068 | 13,200 | 23,238 | - | 598 | 46,104 | | Guy P. Carling | - | 14,869 | 35,000 | 1,652 | - | - | 51,521 | | Emelie C. Tirre | - | 9,549 | 13,200 | 9,678 | 12,809 | 598 | 45,834 |

  26. 2023 Summary Compensation Table

    | (a) For Mr. Sacks, the amount in this column represents premiums paid by the Company for coverage for himself, his spouse, and certain dependents, as the case may be, under all medical, dental, disability, group life, accidental death and travel accident insurance plans and programs. For Mr. Schlosberg, the amounts in this column represent premiums paid by the Company for coverage for himself and the members of his immediate family (to the extent permitted by the applicable plan), as the case may be, under all medical, dental, disability, group life, accidental death and travel accident insurance plans and programs. For Mr. Kelly, the amounts in this column represent premiums paid by the Company for coverage for himself and his spouse, as the case may be, under all medical, dental, disability, group life, accidental death and travel accident insurance plans and programs. For Mr. Carling, the amounts in this column represent premiums paid by the Company for coverage for himself and the members of his immediate family (to the extent permitted by the applicable plan), as the case may be, under all medical, dental, critical illness, group life, accidental death and travel accident insurance plans and programs. For Ms. Tirre, the amounts in this column represent premiums paid by the Company for coverage for herself, as the case may be, under all medical, dental, disability, group life, accidental death and travel accident insurance plans and programs. |

  27. 2023 Summary Compensation Table

    | (b) For Mr. Sacks, the amount in this column represents the entitlement to receive initial and annual fees and all other reasonable expenses relating to membership in up to two business or social clubs selected by Mr. Sacks. For Ms. Tirre, the amount in this column represents the entitlement to receive 50% of the annual fees relating to the membership in one business or social club selected by Ms. Tirre. |

  28. 2023 Summary Compensation Table

    | (6) For Mr. Carling, the amounts reported were paid in GBP and converted to USD using the average exchange rate of GBP to USD on a monthly basis for the years indicated. |

  29. 2023 Grants of Plan-Based Awards

    2023 Grants of Plan-Based Awards The following table summarizes grants of plan-based awards granted to our NEOs during the fiscal year ended December 31, 2023.

  30. 2023 Grants of Plan-Based Awards

    | Name | Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards (3) | | | Estimated Future Payouts Under Equity Incentive Plan Awards (4) | | | All Other Stock Awards: Number of Shares of Stock or Units (#) | All Other Option Awards: Number of Shares Underlying Options (#)(5) | Exercise or Base Price of Option Awards ($/Share) | Grant Date Fair Value of Stock and Option Awards ($)(6) | | | | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | | | Rodney C. Sacks | | | | | | | | | | | | | RSUs (1) | 3/14/2023 | | | | | | | 67,600 | - | - | 3,435,432 | | PSUs (2) | 3/14/2023 | | | | 67,600 | 135,200 | 270,400 | | - | - | 6,870,864 | | Options | 3/14/2023 | | | | | | | | 183,000 | 50.82 | 3,440,363 | | AIA | 3/14/2023 | 825,000 | 1,650,000 | 3,300,000 | | | | - | - | - | - | | Hilton H. Schlosberg | | | | | | | | | | | | | RSUs (1) | 3/14/2023 | | | | | | | 67,600 | - | - | 3,435,432 | | PSUs (2) | 3/14/2023 | | | | 67,600 | 135,200 | 270,400 | | - | - | 6,870,864 | | Options | 3/14/2023 | | | | | | | | 183,000 | 50.82 | 3,440,363 | | AIA | 3/14/2023 | 825,000 | 1,650,000 | 3,300,000 | | | | - | - | - | - | | Thomas J. Kelly | | | | | | | | | | | | | RSUs (1) | 3/14/2023 | | | | | | | 3,400 | - | - | 172,788 | | PSUs (2) | 3/14/2023 | | | | 3,400 | 6,800 | 13,600 | | - | - | 345,576 | | Options | 3/14/2023 | | | | | | | | 10,000 | 50.82 | 187,998 | | Options | 3/14/2023 | | | | | | | | 10,000 | 50.82 | 187,998 | | AIA | 3/14/2023 | 228,750 | 457,500 | 915,000 | | | | - | - | - | - | | Guy P. Carling | | | | | | | | | | | | | RSUs (1) | 3/14/2023 | | | | | | | 6,800 | - | - | 345,576 | | PSUs (2) | 3/14/2023 | | | | 6,800 | 13,600 | 27,200 | | - | - | 691,152 | | Options | 3/14/2023 | | | | | | | | 20,000 | 50.82 | 375,996 | | Options | 3/14/2023 | | | | | | | | 20,000 | 50.82 | 375,996 | | AIA | 3/14/2023 | 265,095 | 530,189 | 1,060,378 | | | | - | - | - | - | | Emelie C. Tirre | | | | | | | | | | | | | RSUs (1) | 3/14/2023 | | | | | | | 6,800 | - | - | 345,576 | | PSUs (2) | 3/14/2023 | | | | 6,800 | 13,600 | 27,200 | | - | - | 691,152 | | Options | 3/14/2023 | | | | | | | | 20,000 | 50.82 | 375,996 | | Options | 3/14/2023 | | | | | | | | 20,000 | 50.82 | 375,996 | | AIA | 3/14/2023 | 307,500 | 615,000 | 1,230,000 | | | | - | - | - | - |

  31. 2023 Grants of Plan-Based Awards

    | (1) The amounts represent shares underlying RSUs granted under our 2020 Omnibus Incentive Plan. |

  32. 2023 Grants of Plan-Based Awards

    | (2) The amounts represent shares underlying PSUs granted under our 2020 Omnibus Incentive Plan. |

  33. 2023 Grants of Plan-Based Awards

    | (3) Represents threshold, target and maximum payout levels for AIAs granted in March 2023 for performance in the year ended December 31, 2023. See “Compensation Discussion and Analysis – 2023 AIAs” for a description of the AIAs. The threshold numbers set forth above are based on achieving the minimum level of performance for which payment would be made with respect to financial performance measures (75% weighting) and assumes 50% payout is made for the individual performance component (25% weighting). |

  34. 2023 Grants of Plan-Based Awards

    | (4) Represents threshold, target and maximum payout levels for PSUs based on achievement of pre-approved, annualized adjusted diluted EPS targets as described more fully in “Compensation Discussion and Analysis – 2023 LTI Program – PSUs.” |

  35. 2023 Grants of Plan-Based Awards

    | (5) The amounts represent options granted under our 2020 Omnibus Incentive Plan. |

  36. 2023 Grants of Plan-Based Awards

    | (6) The assumptions used in the valuation of equity awards are disclosed in Note 16 to the Audited Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. |

  37. Narrative to 2023 Summary Compensation Table and 2023 Grants of Plan-Based Awards Table

    Narrative to 2023 Summary Compensation Table and 2023 Grants of Plan-Based Awards Table Employment Agreements and Arrangements. The principal terms of the employment agreements and arrangements with our NEOs are set forth below. Rodney C. Sacks – On March 18, 2014, we entered into an employment agreement with Mr. Sacks (the “Sacks Employment Agreement”), pursuant to which Mr. Sacks renders services as our Chairman and Co-Chief Executive Officer. Under the Sacks Employment Agreement, Mr. Sacks’ annual base salary will be reviewed annually and increased at the discretion of our Board. Mr. Sacks is eligible to receive an AIA as described under “Compensation Discussion and Analysis – 2023 AIAs” as well as certain fringe benefits. The initial employment period of this agreement commenced on January 1, 2014 and continued through December 31, 2018. Beginning December 31, 2018, the agreement automatically renews for successive one-year renewal periods, unless notice of intent to not renew is given by either us or Mr. Sacks by June 30 of any renewal year. Under the Sacks Employment Agreement, Mr. Sacks is subject to a confidentiality covenant and a six-month post-termination non-competition covenant. The Sacks Employment Agreement is subject to termination (i) upon the death or disability of Mr. Sacks, (ii) voluntarily by Mr. Sacks on 90 days’ written notice, (iii) for Cause (as defined in the Sacks Employment Agreement) by us, or (iv) upon Constructive Termination (as defined in the Sacks Employment Agreement) by Mr. Sacks. The severance provisions in the Sacks Employment Agreement are discussed in the “Potential Payments Upon Termination or Change in Control” section below. During 2023, we entered into certain equity compensation agreements with Mr. Sacks as disclosed in the “2023 Grants of Plan-Based Awards” table above. Hilton H. Schlosberg – On March 18, 2014, we entered into an employment agreement with Mr. Schlosberg (the “Schlosberg Employment Agreement”), pursuant to which Mr. Schlosberg renders services as our Vice Chairman and Co-Chief Executive Officer. Under the Schlosberg Employment Agreement, Mr. Schlosberg’s annual base salary will be reviewed annually and increased at the discretion of our Board. Mr. Schlosberg is eligible to receive an AIA as described under “Compensation Discussion and Analysis – 2023 AIAs” as well as certain fringe benefits. The initial employment period of this agreement commenced on January 1, 2014 and continued through December 31, 2018. Beginning December 31, 2018, the agreement automatically renews for successive one-year renewal periods, unless notice of intent to not renew is given by either us or Mr. Schlosberg by June 30 of any renewal year. Under the Schlosberg Employment Agreement, Mr. Schlosberg is subject to a confidentiality covenant and a six-month post-termination non-competition covenant. The Schlosberg Employment Agreement is subject to termination (i) upon the death or disability of Mr. Schlosberg, (ii) voluntarily by Mr. Schlosberg on 90 days’ written notice, (iii) for Cause (as defined in the Schlosberg Employment Agreement) by us, or (iv) upon Constructive Termination (as defined in the Schlosberg Employment Agreement) by Mr. Schlosberg. The severance provisions in the Schlosberg Employment Agreement are discussed in the “Potential Payments Upon Termination or Change in Control” section below. During 2023, we entered into certain equity compensation agreements with Mr. Schlosberg as disclosed in the “2023 Grants of Plan-Based Awards” table above. Thomas J. Kelly, Guy P. Carling and Emelie C. Tirre – Mr. Kelly’s, Mr. Carling’s and Ms. Tirre’s employment, respectively, is “at will” and thus may be terminated at any time for any or no reason. Mr. Kelly, Mr. Carling and Ms. Tirre are each eligible to receive an AIA as described under “Compensation Discussion and Analysis – 2023 AIAs” as well as certain fringe benefits. 2020 Omnibus Incentive Plan. The principal terms of the awards granted to our NEOs in 2023 under the 2020 Omnibus Incentive Plan are set forth in the “2023 Outstanding Equity Awards at Fiscal Year-End Table” below.

  38. 2023 Outstanding Equity Awards at Fiscal Year-End Table

    2023 Outstanding Equity Awards at Fiscal Year-End Table The following table summarizes the outstanding equity awards held by our NEOs at December 31, 2023.

  39. 2023 Outstanding Equity Awards at Fiscal Year-End Table

    | | | Option Awards | | | | Stock Awards | | | | | Name | Grant Date | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested ($)(3) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or other Rights That Have Not Vested ($)(4) | | Rodney C. Sacks | 03/13/2015 (1) | 4,428 | - | 22.58 | 03/13/2025 | - | - | - | - | | | 03/14/2016 (1) | 630,000 | - | 21.99 | 03/14/2026 | - | - | - | - | | | 03/14/2017 (1) | 611,000 | - | 23.14 | 03/14/2027 | - | - | - | - | | | 03/14/2018 (1) | 528,000 | - | 29.37 | 03/14/2028 | - | - | - | - | | | 03/14/2019 (1) | 583,200 | - | 29.84 | 03/14/2029 | - | - | - | - | | | 03/13/2020 (1) | 382,800 | - | 31.20 | 03/13/2030 | - | - | - | - | | | 03/12/2021 (2) | - | - | - | | 25,268 | 1,455,689 | - | - | | | 03/12/2021 (7) | - | - | - | | - | - | 198,858 | 11,456,209 | | | 03/12/2021 (1) | 173,200 | 86,600 | 44.47 | 03/12/2031 | - | - | - | - | | | 03/14/2022 (2) | - | - | - | | 61,468 | 3,541,171 | - | - | | | 03/14/2022 (7) | - | - | - | | - | - | 184,400 | 10,623,284 | | | 03/14/2022 (1) | 97,132 | 194,268 | 36.62 | 03/14/2032 | - | - | - | - | | | 03/14/2023 (2) | - | - | - | | 67,600 | 3,894,436 | - | - | | | 03/14/2023 (7) | - | - | - | | - | - | 135,200 | 7,788,872 | | | 03/14/2023 (1) | - | 183,000 | 50.82 | 03/14/2033 | - | - | - | - | | Hilton H. Schlosberg | 03/13/2015 (1) | 4,428 | - | 22.58 | 03/13/2025 | - | - | - | - | | | 03/14/2016 (1) | 630,000 | - | 21.99 | 03/14/2026 | - | - | - | - | | | 03/14/2017 (1) | 611,000 | - | 23.14 | 03/14/2027 | - | - | - | - | | | 03/14/2018 (1) | 528,000 | - | 29.37 | 03/14/2028 | - | - | - | - | | | 03/14/2019 (1) | 583,200 | - | 29.84 | 03/14/2029 | - | - | - | - | | | 03/13/2020 (1) | 382,800 | - | 31.20 | 03/13/2030 | - | - | - | - | | | 03/12/2021 (2) | - | - | - | | 25,268 | 1,455,689 | - | - | | | 03/12/2021 (7) | - | - | - | | - | - | 198,858 | 11,456,209 | | | 03/12/2021 (1) | 173,200 | 86,600 | 44.47 | 03/12/2031 | - | - | - | - | | | 03/14/2022 (2) | - | - | - | | 61,468 | 3,541,171 | - | - | | | 03/14/2022 (7) | - | - | - | | - | - | 184,400 | 10,623,284 | | | 03/14/2022 (1) | 97,132 | 194,268 | 36.62 | 03/14/2032 | - | - | - | - | | | 03/14/2023 (2) | - | - | - | | 67,600 | 3,894,436 | - | - | | | 03/14/2023 (7) | - | - | - | | - | - | 135,200 | 7,788,872 | | | 03/14/2023 (1) | - | 183,000 | 50.82 | 03/14/2033 | - | - | - | - | | Thomas J. Kelly | 03/13/2015 (1) | 4,428 | - | 22.58 | 03/13/2025 | - | - | - | - | | | 03/14/2016 (5) | 4,542 | - | 21.99 | 03/14/2026 | - | - | - | - | | | 12/01/2016 (5) | 4 | - | 21.82 | 12/01/2026 | - | - | - | - | | | 03/14/2018 (5) | 6,808 | - | 29.37 | 03/14/2028 | - | - | - | - | | | 03/14/2019 (1) | 10,000 | - | 29.84 | 03/14/2029 | - | - | - | - | | | 03/13/2020 (1) | 24,000 | - | 31.20 | 03/13/2030 | - | - | - | - | | | 03/12/2021 (2) | - | - | - | | 934 | 53,808 | - | - | | | 03/12/2021 (7) | - | - | - | | - | - | 7,336 | 422,627 | | | 03/12/2021 (1) | 6,666 | 3,334 | 44.47 | 03/12/2031 | - | - | - | - | | | 03/14/2022 (2) | - | - | - | | 4,000 | 230,440 | - | - | | | 03/14/2022 (7) | - | - | - | | - | - | 12,000 | 691,320 | | | 03/14/2022 (1) | 6,666 | 13,334 | 36.62 | 03/14/2032 | - | - | - | - | | | 03/14/2023 (2) | - | - | - | | 3,400 | 195,874 | - | - | | | 03/14/2023 (7) | - | - | - | | - | - | 6,800 | 391,748 | | | 03/14/2023 (1) | - | 10,000 | 50.82 | 03/14/2033 | - | - | - | - | | | 03/14/2023 (1) | - | 10,000 | 50.82 | 03/14/2033 | - | - | - | - |

  40. 2023 Outstanding Equity Awards at Fiscal Year-End Table

    | Guy P. Carling | 06/01/2018 (1) | 6 | - | 25.75 | 06/01/2028 | - | - | - | - | | | 03/14/2019 (6) | - | - | - | | 5,100 | 293,811 | - | - | | | 03/14/2019 (5) | - | 15,000 | 29.84 | 03/14/2029 | - | - | - | - | | | 03/13/2020 (6) | - | - | - | | 7,700 | 443,597 | - | - | | | 03/13/2020 (5) | - | 22,000 | 31.20 | 03/13/2030 | - | - | - | - | | | 03/12/2021 (6) | - | - | - | | 4,200 | 241,962 | - | - | | | 03/12/2021 (7) | - | - | - | | - | - | 14,672 | 845,254 | | | 03/12/2021 (5) | - | 15,000 | 44.47 | 03/12/2031 | - | - | - | - | | | 03/14/2022 (6) | - | - | - | | 12,240 | 705,146 | - | - | | | 03/14/2022 (7) | - | - | - | | - | - | 27,200 | 1,566,992 | | | 03/14/2022 (5) | - | 41,400 | 36.62 | 03/14/2032 | - | - | - | - | | | 03/14/2023 (6) | - | - | - | | 6,800 | 391,748 | - | - | | | 03/14/2023 (7) | - | - | - | | - | - | 13,600 | 783,496 | | | 03/14/2023 (1) | - | 20,000 | 50.82 | 03/14/2033 | - | - | - | - | | | 03/14/2023 (5) | - | 20,000 | 50.82 | 03/14/2033 | - | - | - | - | | Emelie C. Tirre | 06/01/2018 (1) | 16,666 | - | 25.75 | 06/01/2028 | - | - | - | - | | | 03/14/2019 (6) | - | - | - | | 5,100 | 293,811 | - | - | | | 03/14/2019 (5) | 35,000 | 15,000 | 29.84 | 03/14/2029 | - | - | - | - | | | 03/13/2020 (6) | - | - | - | | 7,700 | 443,597 | - | - | | | 03/13/2020 (5) | 18,000 | 22,000 | 31.20 | 03/13/2030 | - | - | - | - | | | 03/12/2021 (6) | - | - | - | | 4,200 | 241,962 | - | - | | | 03/12/2021 (7) | - | - | - | | - | - | 14,672 | 845,254 | | | 03/12/2021 (5) | 5,000 | 15,000 | 44.47 | 03/12/2031 | - | - | - | - | | | 03/14/2022 (6) | - | - | - | | 12,240 | 705,146 | - | - | | | 03/14/2022 (7) | - | - | - | | - | - | 27,200 | 1,566,992 | | | 03/14/2022 (5) | 4,600 | 41,400 | 36.62 | 03/14/2032 | - | - | - | - | | | 03/14/2023 (6) | - | - | - | | 6,800 | 391,748 | - | - | | | 03/14/2023 (7) | - | - | - | | - | - | 13,600 | 783,496 | | | 03/14/2023 (1) | - | 20,000 | 50.82 | 03/14/2033 | - | - | - | - | | | 03/14/2023 (5) | - | 20,000 | 50.82 | 03/14/2033 | - | - | - | - |

  41. 2023 Outstanding Equity Awards at Fiscal Year-End Table

    | (1) Award of stock options in this row has vested, or, to the extent not yet vested, is subject to vest, in three, equal (or substantially equal) one-third annual installments on the first three anniversaries of the grant date, subject to continuous employment. | | (2) Award of RSUs in this row is subject to vest in three, equal (or substantially equal) one-third annual installments on the first three anniversaries of the grant date, subject to continuous employment. | | (3) Award of PSUs in this column represent the issuable number of PSUs granted under the 2020 Omnibus Incentive Plan, assuming the applicable target or actual level of performance is achieved and all NEOs remained continuously employed through the applicable vesting date. Award of PSUs in this column are eligible to vest subject to the achievement of pre-established EPS goals during each applicable performance period (the three-year period beginning on January 1, 2021 and ending on December 31, 2023 (the “2021 PSU Awards”), the three-year period beginning on January 1, 2022 and ending on December 31, 2024 (the “2022 PSU Awards”), and the three-year period beginning on January 1, 2023 and ending on December 31, 2025 (the “2023 PSU Awards”), respectively), which goals are subject to certain adjustments, and continuous employment through each applicable performance period. | | (4) Represents the value of unvested PSUs using the closing price of our Common Stock on December 29, 2023 ($57.61), assuming achievement as follows for each applicable performance period: actual level of performance for the 2021 PSU Awards; and target level of performance for the 2022 PSU Awards and 2023 PSU Awards. | | (5) Award of stock options in this row has vested, or, to the extent not yet vested, is subject to vest, in five, annual installments with 10% vesting on the first anniversary of the grant date, 15% vesting on the second anniversary of the grant date, 20% vesting on the third anniversary of the grant date, 25% vesting on the fourth anniversary of the grant date and 30% vesting on the fifth anniversary of the grant date, subject to continuous employment. | | (6) Award of RSUs in this row is subject to vest in five, annual installments with 10% vesting on the first anniversary of the grant date, 15% vesting on the second anniversary of the grant date, 20% vesting on the third anniversary of the grant date, 25% vesting on the fourth anniversary of the grant date and 30% vesting on the fifth anniversary of the grant date, subject to continuous employment. | | (7) Award of PSUs are scheduled to vest in one installment following the achievement of the performance criteria in the applicable performance period, subject to continuous employment. |

  42. 2023 Option Exercises and Stock Vested Table

    2023 Option Exercises and Stock Vested Table The following table summarizes exercise of stock options and stock vested by our NEOs during the Company’s fiscal year ended December 31, 2023.

  43. 2023 Option Exercises and Stock Vested Table

    | | Option Awards | | Stock Awards | | | Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($)(1) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($)(2)(3) | | Rodney C. Sacks | 2,990,772 | 130,620,835 | 180,976 | 9,159,368 | | Hilton H. Schlosberg | 2,990,772 | 130,620,835 | 180,976 | 9,159,368 | | Thomas J. Kelly | 123,192 | 3,614,469 | 8,502 | 429,694 | | Guy P. Carling | 76,760 | 2,129,677 | 21,050 | 1,118,599 | | Emelie C. Tirre | 209,012 | 6,225,585 | 21,050 | 1,118,599 |

  44. 2023 Option Exercises and Stock Vested Table

    | (1) The value realized upon the exercise of the stock options reflects the number of options multiplied by the difference between the closing stock price of our Common Stock on the date of the exercise and the exercise price of the options. |

  45. 2023 Option Exercises and Stock Vested Table

    | (2) The value realized upon vesting of the RSU awards represents the number of shares of our Common Stock underlying such RSU awards multiplied by the closing stock price of our Common Stock on the date the awards vested. |

  46. 2023 Option Exercises and Stock Vested Table

    | (3) The value realized upon vesting of the 2021 PSU Awards granted under the 2020 Omnibus Incentive Plan represents the number of shares of our Common Stock underlying such PSU awards, multiplied by the closing stock price of our Common Stock on March 14, 2023 ($50.82), the date the shares underlying such PSU awards were released. |

  47. Pension Benefits

    Pension Benefits We do not maintain or make contributions to a defined benefit plan for any of our NEOs.

  48. 2023 Non-Qualified Deferred Compensation Table

    2023 Non-Qualified Deferred Compensation Table The following table summarizes the contributions, earnings and withdrawals by our NEOs during the Company’s fiscal year ended December 31, 2023. For additional details regarding the Deferred Compensation Plan, see “Compensation Discussion and Analysis - Deferred Compensation Plan.”

  49. 2023 Non-Qualified Deferred Compensation Table

    | Name | Executive Contributions in Last FY ($)(1) | Registrant Contributions in Last FY ($) | Aggregate Earnings in Last FY ($)(2) | Aggregate Withdrawals/ Distributions ($) | Aggregate Balance at Last FYE ($)(3) | | Rodney C. Sacks | - | - | - | - | - | | Hilton H. Schlosberg | 370,000 | - | 186,158 | - | 2,320,558 | | Thomas J. Kelly | - | - | - | - | - | | Guy P. Carling | - | - | - | - | - | | Emelie C. Tirre | - | - | - | - | - |

  50. 2023 Non-Qualified Deferred Compensation Table

    | (1) All contributions shown are included in the “Salary” column of the 2023 Summary Compensation Table. |

  51. 2023 Non-Qualified Deferred Compensation Table

    | (2) The amount reported in the earnings column above is not reported as compensation in the Summary Compensation Table because the applicable earnings rate was not in excess of market rates. |

  52. 2023 Non-Qualified Deferred Compensation Table

    | (3) With respect to Mr. Schlosberg, amount includes amounts previously reported in the Summary Compensation Table for years prior to 2023 as “Salary” in the following aggregate amount: $1,763,531. The information in this footnote is provided to clarify the extent to which amounts payable as deferred compensation represent compensation reported in our prior proxy statements, rather than additional currently earned compensation. |

  53. Potential Payments upon Termination or Change in Control

    Potential Payments upon Termination or Change in Control We have entered into certain agreements and maintain certain plans that may require us to make certain payments and/or provide certain benefits to our NEOs in the event of a termination of their employment or a change of control. The following tables and narrative disclosure summarize the payments to each of our NEOs assuming that one of the events listed in the tables below occurs. The tables assume that the event occurred on December 31, 2023, the last day of our most recently completed fiscal year.

  54. DIRECTOR COMPENSATION

    DIRECTOR COMPENSATION The following table sets forth a summary of the compensation paid to our non-employee directors and Mr. Hall (an employee director) during the fiscal year ended December 31, 2023.

  55. DIRECTOR COMPENSATION

    | Name | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(2)(3) | Option Awards ($)(4) | All Other Compensation ($)(5) | Total ($) | | Ana Demel | - | 259,999 | - | - | 259,999 | | James L. Dinkins | 85,000 | 175,011 | - | - | 260,011 | | Gary P. Fayard | - | 285,005 | - | - | 285,005 | | Mark J. Hall (5) | - | - | 1,088,946 | 1,484,602 | 2,573,548 | | Tiffany M. Hall | 42,500 | 217,502 | - | - | 260,002 | | Jeanne P. Jackson | - | 267,565 | - | - | 267,565 | | Steven G. Pizula | 127,500 | 175,011 | - | - | 302,511 | | Mark S. Vidergauz | 195,000 | 175,011 | - | - | 370,011 |

  56. DIRECTOR COMPENSATION

    | (1) The amounts reported in this column reflect the cash fees earned by each non-employee director in 2023. Cash fees deferred and received in the form of deferred stock units are included in the “Stock Awards” column of this Director Compensation Table. |

  57. DIRECTOR COMPENSATION

    | (2) The amounts reported in this column are valued based on the aggregate grant date fair value computed in accordance with ASC Topic 718. The assumptions used in the valuation of equity awards are disclosed in Note 16 to the Audited Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. The non-employee directors held the following numbers of outstanding deferred stock units as of December 31, 2023: Ms. Demel, 6,912; Mr. Dinkins, 0; Mr. Fayard, 43,473; Ms. Hall, 5,502; Ms. Jackson, 24,779; Mr. Pizula, 17,276; and Mr. Vidergauz, 3,974. Each non-employee director (other than Mr. Dinkins) elected to defer the entire portion of their respective June 14, 2022 grants of RSUs, which vested on June 21, 2023. Ms. Demel, Mr. Fayard, Ms. Hall and Ms. Jackson elected to defer all or a portion of their 2023 cash compensation into deferred stock units, as reflected in further detail in the table below. |

  58. DIRECTOR COMPENSATION

    | Name | Grant Date of Deferred Stock Units | Number of Deferred Stock Units (#) | Grant Date Fair Value of Deferred Stock Units ($) | | Ana Demel | 01/09/2023 04/10/2023 07/10/2023 10/06/2023 | 420 406 377 425 | 21,242 21,254 21,255 21,237 | | Gary P. Fayard | 01/09/2023 04/10/2023 07/10/2023 10/06/2023 | 544 525 488 550 | 27,513 27,484 27,513 27,484 | | Tiffany M. Hall | 01/09/2023 04/10/2023 07/10/2023 10/06/2023 | 210 203 188 213 | 10,621 10,627 10,599 10,644 | | Jeanne P. Jackson | 01/09/2023 04/10/2023 07/10/2023 10/06/2023 | 458 442 410 463 | 23,163 23,139 23,116 23,136 |

  59. DIRECTOR COMPENSATION

    | (3) The non-employee directors held the following numbers of RSUs as of December 31, 2023: Ms. Demel, 2,932; Mr. Dinkins, 2,932; Mr. Fayard, 2,932; Ms. Hall, 2,932; Ms. Jackson, 2,932; Mr. Pizula, 2,932; and Mr. Vidergauz, 2,932. For those non-employee directors who held RSUs as of December 31, 2023, such RSUs were granted on June 22, 2023 and will vest on the last business day prior to the Annual Meeting. The aggregate grant date fair value for each such grant of RSUs was approximately $175,011, which amount, as applicable, is reflected in this column. Each RSU represents either (i) a contingent right to receive one share of Common Stock or (ii) a cash amount equal to the number of shares received as of the vesting date (the last business day prior to the Annual Meeting). |

  60. DIRECTOR COMPENSATION

    | (4) The non-employee directors held no outstanding stock options as of December 31, 2023. With respect to Mr. Hall, the amounts reported in this column are valued based on the aggregate grant date fair value computed in accordance with ASC Topic 718. |

  61. DIRECTOR COMPENSATION

    | (5) Mr. Hall received no compensation as a director in 2023. As an employee of MEC, in 2023, Mr. Hall received a base salary of $820,000, a cash bonus award of $575,000, an automobile allowance of $9,830, a 401(k) match of $8,456, payment of benefits premiums of $23,238, a personal equipment allowance of $598, a housing and utilities allowance of $47,480 and was granted 60,000 stock options under the 2020 Omnibus Incentive Plan that vest in five annual installments with 10% vesting on the first anniversary of the grant date, 15% vesting on the second anniversary of the grant date, 20% vesting on the third anniversary of the grant date, 25% vesting on the fourth anniversary of the grant date and 30% vesting on the fifth anniversary of the grant date, subject to continuous employment. Mr. Hall held 590,000 outstanding stock options as of December 31, 2023. |

  62. DIRECTOR COMPENSATION

    In 2023, non-employee directors were entitled to receive an annual cash retainer of $85,000. Except for committee chairs, members of the Audit Committee received an additional annual cash retainer of $10,000 and members of the Compensation Committee and the Nominating and Corporate Governance Committee received an additional annual retainer of $7,500. The chairman of the Audit Committee received an additional annual retainer of $25,000 and the chairs of the Compensation Committee and the Nominating and Corporate Governance Committee each received an additional annual cash retainer of $22,500. The Lead Independent Director received an additional annual cash retainer of $40,000. In 2023, non-employee directors were entitled to receive an annual equity retainer of approximately $175,000, delivered in the form of RSUs that generally vest one day prior to the immediately following annual meeting. As described below under “Non-Employee Directors Equity Compensation Plans,” RSUs may be deferred under the Deferred Compensation Plan for Non-Employee Directors. Further, non-employee directors are subject to stock ownership guidelines.

  63. CEO PAY RATIO

    CEO PAY RATIO Pursuant to Item 402(u) of Regulation S-K and Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Company is required to provide the ratio of the annual total compensation of Mr. Sacks and Mr. Schlosberg, who served as the Company’s Co-Chief Executive Officers in 2023, to the annual total compensation of the median employee of the Company for 2023. To identify, and to determine the annual total compensation of, the median employee in 2020 we used the following methodology:

  64. CEO PAY RATIO

    | ● | As of December 31, 2023, we employed 6,003 employees globally. | | ● | We collected payroll data of all active full-time and part-time employees globally as of December 31, 2023, which is also the date the Company selected for identifying its median employee. | | ● | We applied a 6-month average exchange rate from July 1, 2023 through December 31, 2023, to convert all international currencies into U.S. dollars. | | ● | We used total cash compensation as of December 31, 2023 which includes base pay, bonus and other prevalent local allowances in certain foreign countries, as our consistently applied compensation measure, which we believe reasonably reflects the annual compensation of our employees (given the limited number of employees who receive equity awards) and consistently applies to all of our employees. |

  65. CEO PAY RATIO

    | ● | We annualized total cash compensation for full-time and part-time employees who were hired in 2023. | | ● | Using this methodology, we determined that the median employee was an exempt, full-time employee located in the U.S. with an annual total compensation of $98,177 for 2023, calculated in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K, which is the same manner in which Mr. Sacks’s and Mr. Schlosberg’s annual total compensation was calculated in the Summary Compensation Table. |

  66. CEO PAY RATIO

    As reported in the Summary Compensation Table, Mr. Sacks’s and Mr. Schlosberg’s annual total compensation for 2023 was $17,875,482 and $17,805,908, respectively, and the median annual total compensation of all employees of the Company and its subsidiaries (other than Mr. Sacks and Mr. Schlosberg) was $98,177. Based on this information, for 2023, the ratio of the compensation of Mr. Sacks and Mr. Schlosberg to the median annual total compensation of all other employees (other than Mr. Sacks and Mr. Schlosberg) was estimated to be 182:1 and 181:1, respectively. Because the SEC rules for identifying the median employee and calculating the pay ratio allow companies to use different methodologies, exemptions, estimates and assumptions, the above disclosure may not be comparable to the pay ratio reported by other companies and is only a reasonable estimate.

  67. PAY VERSUS PERFORMANCE

    PAY VERSUS PERFORMANCE The following tables and related disclosures have been prepared in accordance with the SEC’s pay versus performance rules in Item 402(v) of Regulation S-K of the Exchange Act (“Item 402(v)”) and provide information about (i) the total compensation (“SCT Total”) of our principal executive officers (“PEOs”) and our non-PEO NEOs (collectively, the “Non-PEO NEOs”) as presented in the Summary Compensation Table on page 32, (ii) the “compensation actually paid” (“CAP”) to our PEOs and our Non-PEO NEOs, as calculated pursuant to Item 402(v), (iii) certain financial performance measures, and (iv) the relationship of the CAP to those financial performance measures. The below tables and disclosures do not necessarily reflect value actually realized by the NEOs or how the Compensation Committee evaluates compensation decisions in light of the Company’s performance or individual performance.

  68. PAY VERSUS PERFORMANCE

    | Year | Summary Compensation Table Total for PEO Rodney C. Sacks ($)(1) | Summary Compensation Table Total for PEO Hilton H. Schlosberg ($)(1) | Compensation Actually Paid to PEO Rodney C. Sacks ($)(1) | Compensation Actually Paid to PEO Hilton H. Schlosberg ($)(1) | Average Summary Compensation Table Total for Non-PEO NEOs ($)(1) | Average Compensation Actually Paid to Non-PEO NEOs ($)(1) | Value of Fixed $100 Investment Based on: | | Net Income (In Thousands) ($) | Adjusted Operating Income (Non- GAAP) (In Thousands) ($)(4) | | | | | | | | | Total Shareholder Return ($)(2) | Peer Group Total Shareholder Return ($)(3) | | | | 2023 | 17,875,482 | 17,805,908 | 23,974,469 | 23,904,895 | 3,182,634 | 4,210,627 | 181 | 129 | 1,630,988 | 2,012,539 | | 2022 | 15,417,084 | 15,394,400 | 20,055,879 | 20,033,195 | 2,837,541 | 3,565,950 | 160 | 133 | 1,191,624 | 1,685,745 | | 2021 | 16,707,577 | 16,686,528 | 18,142,857 | 18,121,808 | 2,013,059 | 1,961,241 | 151 | 124 | 1,377,475 | 1,816,831 | | 2020 | 15,563,685 | – | 30,359,411 | – | 5,533,947 | 12,225,985 | 146 | 107 | 1,409,594 | 1,621,482 |

  69. PAY VERSUS PERFORMANCE

    | (1) For 2023, 2022 and 2021, our PEOs were Rodney C. Sacks and Hilton H. Schlosberg and our Non-PEO NEOs were Thomas J. Kelly, Guy P. Carling and Emelie C. Tirre. For 2020, our PEO was Rodney C. Sacks and our Non-PEO NEOs were Hilton H. Schlosberg, Thomas J. Kelly, Guy P. Carling and Emelie C. Tirre. |

  70. PAY VERSUS PERFORMANCE

    | (2) The amounts represent an initial value of $100 on December 31, 2019 at the end of the fiscal years ended December 31, 2020, 2021, 2022 and 2023 and assumes that all dividends (if applicable) were reinvested. |

  71. PAY VERSUS PERFORMANCE

    | (3) The amounts represent an initial value of $100 into the Company’s peer group on a market capitalization weighted basis on December 31, 2019 at the end of the fiscal years ended December 31, 2020, 2021, 2022 and 2023 and assumes that all dividends (if applicable) were reinvested. The Company’s self-selected peer group is as described in Part II, Item 5 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 29, 2024, which is comprised of TCCC, Keurig Dr. Pepper Inc., Constellation Brands, Inc., Molson Coors Beverage Company and PepsiCo, Inc. |

  72. PAY VERSUS PERFORMANCE

    | (4) The Company has elected to present adjusted operating income, as the Company-selected measure to assist in understanding the changes in CAP over the fiscal years presented. For a reconciliation of adjusted operating income to operating income, the most directly comparable GAAP financial measure, see Appendix A. |

  73. PAY VERSUS PERFORMANCE

    A reconciliation of adjustments from SCT Total to CAP for our PEOs and Non-PEO NEOs is presented in the table below. For purposes of this reconciliation, because the Company historically has not paid dividends, no adjustment was made for the amount of any dividends or other earnings for any unvested stock awards on which dividends or other earnings were paid during any applicable fiscal year that were not otherwise included in the total compensation column of the SCT for the applicable fiscal year.

  74. PAY VERSUS PERFORMANCE

    | | PEO/ | SCT Total | (a) | (b) | (c) | (d) | (e) | (f) | (g) | CAP Amounts | | Year | Non-PEO NEOs | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | | | PEO Rodney C. Sacks | 17,875,482 | (13,746,659) | 15,916,007 | 2,873,972 | - | 1,055,667 | - | - | 23,974,469 | | 2023 | PEO Hilton H. Schlosberg | 17,805,908 | (13,746,659) | 15,916,007 | 2,873,972 | - | 1,055,667 | - | - | 23,904,895 | | | Non-PEO NEOs* | 3,182,634 | (1,490,600) | 1,750,353 | 581,262 | - | 186,978 | - | - | 4,210,627 | | | PEO Rodney C. Sacks | 15,417,084 | (13,563,286) | 21,055,402 | 1,634,689 | - | (4,488,010) | - | - | 20,055,879 | | 2022 | PEO Hilton H. Schlosberg | 15,394,400 | (13,563,286) | 21,055,402 | 1,634,689 | - | (4,488,010) | - | - | 20,033,195 | | | Non-PEO NEOs* | 2,837,541 | (1,655,774) | 2,583,986 | 414,736 | - | (614,539) | - | - | 3,565,950 | | | PEO Rodney C. Sacks | 16,707,577 | (13,529,221) | 14,649,088 | 1,006,176 | - | (690,763) | - | - | 18,142,857 | | 2021 | PEO Hilton H. Schlosberg | 16,686,528 | (13,529,221) | 14,649,088 | 1,006,176 | - | (690,763) | - | - | 18,121,808 | | | Non-PEO NEOs* | 2,013,059 | (841,200) | 909,252 | 217,845 | - | (337,715) | - | - | 1,961,241 | | 2020 | PEO Rodney C. Sacks | 15,563,685 | (12,505,247) | 18,651,286 | 8,507,694 | 2,370,447 | (2,228,454) | - | - | 30,359,411 | | | Non-PEO NEOs* | 5,533,947 | (3,884,582) | 5,810,737 | 4,361,150 | 823,812 | (419,079) | - | - | 12,225,985 |

  75. PAY VERSUS PERFORMANCE

    * Amounts presented are averages for the entire group of Non-PEO NEOs in each respective year.

  76. PAY VERSUS PERFORMANCE

    | (a) (Deduct): Aggregate value for stock awards and option awards included in SCT for the covered fiscal year. |

  77. PAY VERSUS PERFORMANCE

    | (b) Add: Fair value at year end of stock awards and option awards granted during the covered fiscal year that were outstanding and unvested at the covered fiscal year end. |

  78. PAY VERSUS PERFORMANCE

    | (c) Add (Deduct): The change in fair value (whether positive or negative) at the covered fiscal year end of stock awards and option awards granted in any prior fiscal year that were outstanding and unvested at the covered fiscal year end, as measured from the end of the prior fiscal year. |

  79. PAY VERSUS PERFORMANCE

    | (d) Add: Vesting date fair value of stock awards and option awards granted and vested during the covered fiscal year. |

  80. PAY VERSUS PERFORMANCE

    | (e) Add (Deduct): Change as of the vesting date (from the end of the prior fiscal year) in fair value (whether positive or negative) of awards granted in any prior fiscal year for which vesting conditions were satisfied during the covered fiscal year. |

  81. PAY VERSUS PERFORMANCE

    | (f) Deduct: Fair value at the applicable fiscal year end of stock awards and option awards that were granted in any prior fiscal year that did not vest during the covered fiscal year by failing to satisfy the relevant vesting conditions for the applicable stock award or option award. |

  82. PAY VERSUS PERFORMANCE

    | (g) Add: Dividends or other earnings paid on stock awards or option awards in the covered fiscal year prior to vesting if not otherwise included in the SCT Total for the covered fiscal year. |

  83. PAY VERSUS PERFORMANCE

    The following table lists the financial performance measures that, in the Company’s assessment, represent the most important performance measures used to link CAP for our NEOs to Company performance for 2023. We determined Adjusted Operating Income to be the most important financial performance measure used to link the Company’s performance to CAP to our PEOs and Non-PEO NEOs in 2023. We may determine different financial performances to be the most important financial performance in future years.

  84. PAY VERSUS PERFORMANCE

    | Financial Performance Measures | | Adjusted operating income | | Adjusted diluted EPS |

  85. PAY VERSUS PERFORMANCE

    For a reconciliation of adjusted diluted EPS to diluted EPS, the most directly comparable GAAP financial measure, see Appendix A. The graphs below show the relationship of CAP to our PEOs and Non-PEO NEOs to (i) cumulative TSR of both the Company and the peer group as described in Part II, Item 5 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 29, 2024, (ii) the Company’s adjusted operating income (non-GAAP) and (iii) the Company’s net income. CAP, as calculated in accordance with Item 402(v), reflects, among others, adjustments to the fair value of equity awards during the fiscal years presented. Factors impacting the fair value of equity awards include the price of the Company’s common stock at fiscal year end, as well as the projected and actual achievement of performance goals.