DEF 14A of Backblaze, Inc.
Filed Apr 5, 2024 · FY20230001140361-24-018072
ELECTION OF DIRECTORS
ELECTION OF DIRECTORS
General
General Our Board of Directors (the “Board”) may establish the authorized number of directors from time to time by resolution. Our Board currently consists of five members. Our directors hold office until their successors have been elected and qualified or appointed, or the earlier of their death, resignation or removal. Our Board is divided into three classes with staggered three-year terms. The Certificate of Incorporation and the Bylaws provide that only our Board can fill vacant directorships. Any additional directorships resulting from an increase in the authorized number of directors would be distributed pro rata among the three classes so that, as nearly as possible, each class would consist of one-third of the authorized number of directors.
Nominees
Nominees Two Class III directors have been nominated for election at the Annual Meeting, each for a three-year term expiring in 2027. Upon the recommendation of our Nominating and Corporate Governance Committee, our Board has nominated Gleb Budman and Evelyn D’An for election as Class III directors at the Annual Meeting. The term of office of each elected Class III director will continue until such director’s term expires in 2027, or until such director’s successor has been duly elected and qualified, or the earlier of his or her death, resignation or removal. Each person nominated for election has agreed to serve if elected. Directors are elected by a plurality of the votes of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors. This means that nominees receiving the highest number of “For” votes will be elected. Shares represented by executed proxies will be voted, if authority to do so is not withheld, for the election of the nominee named below. However, if you are a street name stockholder, which means that your shares are held by a broker, bank or other nominee, your shares will not be voted for the election of directors unless you have provided voting instructions to your nominee.
Information Regarding the Nominees and the Continuing Directors
Information Regarding the Nominees and the Continuing Directors The biographies below include information, as of March 21, 2024, regarding the specific experience, qualifications, attributes or skills of each of our Class I, Class II and Class III directors.
Information Regarding the Nominees and the Continuing Directors
| | Class | Age | Position(s) with Backblaze | Current Term Expires | Expiration of Term for which Nominated | | Class III Nominees | | | | | | | Gleb Budman | III | 50 | Chief Executive Officer and Chairperson of the Board | 2024 | 2027 | | Evelyn D’An | III | 62 | Director | 2024 | 2027 | | Class I Continuing Directors | | | | | | | Barbara Nelson | I | 69 | Director | 2025 | — | | Earl E. Fry | I | 65 | Director | 2025 | — | | Class II Continuing Director | | | | | | | Jocelyn Carter-Miller | II | 66 | Lead Independent Director | 2026 | — |
Nominees for Class III Directors for a Term Expiring in 2027
Nominees for Class III Directors for a Term Expiring in 2027 Gleb Budman is one of our co-founders and has served as our Chief Executive Officer since 2007. Mr. Budman has also served as a member of our Board since 2009 and Chairperson since January 2021. Prior to Backblaze, Mr. Budman served in various senior roles at SonicWall, Inc., MailFrontier, Inc. (acquired by SonicWall, Inc.) and Kendara, Inc. (acquired by Excite@Home, Inc.). Mr. Budman also previously founded two other startup companies. Mr. Budman earned a M.B.A. and B.S. in Mechanical Engineering from the University of California, Berkeley. We believe that Mr. Budman is qualified to serve as a member of our Board because of his extensive experience in leadership roles at various technology companies, and the continuity that he brings to our Board as our co-founder and Chief Executive Officer. Evelyn D’An has served as a member of our Board since August 2021. Ms. D'An is President of D’An Financial Services, a strategic consulting firm she established in 2004. Ms. D’An is also a former partner of Ernst & Young, an accounting and professional services firm, where she spent 18 years serving clients in retail, consumer products, technology, financial services, media and other sectors. Ms. D’An also currently serves on the board of directors of Zoomcar, Inc., a car sharing platform company, where she has served since April 2023 and GHD Group Pty Ltd., a technical professional services firm, where she has served since March 2020, and she is the chair of the audit committee of both companies. Ms. D’An has served on numerous other corporate boards since 2006, including as a director of Summer Infant, Inc., manufacturer of infant and juvenile products, from November 2016 to June 2022. She graduated with a Bachelor of Science in Accounting from the State University of Albany. We believe that Ms. D’An is qualified to serve as a member of our Board because of her extensive experience advising technology companies and other public companies as both a director and executive. We believe Ms. D’An brings to our Board significant corporate governance, financial and accounting experience.
Continuing Class I Directors Whose Term Expires in 2025
Continuing Class I Directors Whose Term Expires in 2025 Barbara Nelson has served as a member of our Board of Directors since October 2020. Ms. Nelson also serves as a board member for GSI Technology, Inc., a publicly traded semiconductor and SaaS company, where she has served since August 2021, Oneview Healthcare, Plc, a publicly traded healthcare technology company, since October 2023, and Omniscient Technology (o8t), a private company pioneering AI applied to brain connectivity, since October 2022. Ms. Nelson was the Vice President of Cloud Services, Software and Strategy for the consumer group of Western Digital Corporation, a hard disk drive manufacturer and data storage company, from May 2017 to April 2020. Prior to Western Digital Corporation, Ms. Nelson served as the General Manager and Executive Vice President of IronKey Mobile Security at Imation Corporation from 2013 to 2016. From July 2008 to March 2010, Ms. Nelson was the Chief Executive Officer and a member of the board of directors of Element Labs, a private company and from October 2003 to December 2007, she was the Chief Executive Officer and Chairperson of the board of directors of NeoScale Systems, a private company. Ms. Nelson earned her B.S. in Electrical Engineering from Stanford University. We believe that Ms. Nelson is qualified to serve as a member of our Board because of her extensive experience advising technology companies as both a director and executive, as well as decades of SaaS, storage and security experience. Earl E. Fry has served as a member of our Board of Directors since August 2021. Mr. Fry currently serves as a member of the board of directors of Hawaiian Airlines, an airline company, and has served as the chair of the audit and finance committee since May 2016. From December 1999 to August 2015, Mr. Fry served in various capacities at Informatica Corporation, an enterprise data integration software company, including Chief Financial Officer, Chief Administrative Officer, Chief Customer Officer and Executive Vice President, Operations Strategy. Mr. Fry has also served on the board of directors of Central Pacific Financial Corp., a commercial bank, since April 2005 and is a member of the audit committee and risk committee. Mr. Fry served on the board of directors of Xactly Corporation, a cloud-based enterprise software and services company, from September 2005 to August 2017. Mr. Fry received a B.B.A. in Accounting from the University of Hawai’i and has an MBA from the Stanford University Graduate School of Business. We believe Mr. Fry is qualified to serve as a member of our Board because of his significant professional experience in the areas of finance, accounting and audit oversight, both as a director and executive, as well as his substantial experience with respect to the software and cloud businesses, which allows him to contribute valuable insight and perspective.
Director Compensation
Director Compensation The following table presents the total compensation, including equity awards, paid to each of our non-employee directors during the year ended December 31, 2023 for their service on our Board. We also reimburse our directors for expenses associated with attending meetings of our Board and its committees.
Director Compensation
| Name | Fees Earned or Paid in Cash ($) | Option Awards ($) | Stock Awards ($)(1) | All Other Compensation ($) | Total ($) | | Jocelyn Carter-Miller | 76,000 | — | 150,000 | — | 226,000 | | Barbara Nelson | 53,000 | — | 150,000 | — | 203,000 | | Evelyn D'An | 61,000 | — | 150,000 | — | 211,000 | | Earl E. Fry | 55,000 | — | 150,000 | — | 205,000 |
Director Compensation
| (1) The amounts in this column include the aggregate grant date fair value of restricted stock units granted to each of the applicable directors during the year ended December 31, 2023, computed in accordance with FASB ASC Topic 718. See the notes to our financial statements included in our Annual Report on Form 10-K, as filed with the Securities and Exchange Commission on April 1, 2024, for a discussion of the assumptions made by us in determining the grant date fair value of our equity awards. As of December 31, 2023, each of Ms. Carter-Miller, Ms. Nelson, Mr. Fry and Ms. D’an held outstanding unvested restricted stock units representing 35,211 shares of our Class A Common Stock, respectively. |
Director Compensation
Directors who are also our employees or officers receive no additional compensation for their service as directors while employed by the Company. Specifically, Mr. Budman, a current director and current employee, did not receive additional compensation for his service as a director in 2023. See the section titled “Executive Compensation” elsewhere in this proxy statement for additional information about the compensation of Mr. Budman, who was also a named executive officer in 2023.
Non-Employee Director Compensation Policy
Non-Employee Director Compensation Policy Prior to our initial public offering in November 2021, we did not implement a formal policy with respect to compensation payable to our directors for their service on our Board. In April 2021, our Board approved a director compensation policy for non-employee directors to be effective in connection with our initial public offering. Pursuant to this policy, our non-employee directors receive following completion of the offering the compensation described below. No changes were made to our non-employee director compensation policy in 2023. Cash Compensation Each non-employee director receives an annual cash retainer of $35,000. Our Lead Independent Director is also paid an additional annual cash retainer of $15,000. In addition to the annual cash retainer, each director receives the following annual cash amounts for service on Board committees:
Non-Employee Director Compensation Policy
| Committee | Chairperson | Member | | Audit | $20,000 | $10,000 | | Compensation | $12,000 | $6,000 | | Nominating and Governance | $8,000 | $4,000 |
Non-Employee Director Compensation Policy
All cash amounts are paid in arrears in quarterly installments. Equity Compensation Each non-employee director serving on our Board as of immediately following our initial public offering, who also served on our Board for at least nine months prior to our initial public offering, was granted an RSU award for 9,375 shares of our Class A Common Stock (reflecting $150,000 divided by the Company’s initial public offering price). Subject to the director’s continuing service, the RSU award will vest on the one-year anniversary of the grant date, which was the effective date of the registration statement on Form S-8 that we filed on November 12, 2021. Each non-employee director initially appointed or nominated as a member of our Board after our initial public offering will receive an RSU award covering a number of shares of common stock having a grant date value of $300,000, determined using the closing price of our Class A Common Stock on the grant date. Subject to the director’s continuing service, the RSU award will vest in equal annual installments over a 3-year period, with vesting to occur on the anniversary of the grant date, which will be the date of the director’s appointment or nomination. Each non-employee director elected or re-elected to our Board at, or otherwise continuing to serve as a director after, an annual meeting of our stockholders will also receive an RSU award covering a number of shares of common stock having a grant date value of $150,000, determined using the closing price of our Class A Common Stock on the grant date, which shall be the date of the annual meeting at which the election or re-election occurs. Such annual RSUs will vest on the earlier of the next following annual shareholders meeting or the first anniversary of grant. Directors newly appointed to our Board between annual stockholder meetings, receiving an automatic equity grant immediately following this offering as detailed above or who joined the Board within the prior 12 months to such annual meeting of stockholders, will receive an annual award prorated to reflect their time on the Board prior to the stockholder meeting date or the date of the equity award immediately following this offering, as the case may be. Equity awards held by our non-employee directors will vest in full upon a change in control of the Company.
Summary Compensation Table
Summary Compensation Table The following table shows information regarding the compensation of our principal executive officer and our two most highly compensated executive officers (other than our chief executive officer) who were serving as executive officers as of December 31, 2023, whom we refer to herein as our “named executive officers.”
Summary Compensation Table
| Name and Principal Position(1) | Year | Salary ($) | Non- Equity Incentive Plan ($) | RSU Awards ($)(1)(2)(3) | All Other Compensation ($)(4) | Total ($) | | Gleb Budman Chief Executive Officer and Chairperson | 2023 | 525,000 | — | 79,285 | 9,900 | 614,185 | | | 2022 | 420,720 | — | 37,345 | 9,150 | 467,215 | | Frank Patchel Chief Financial Officer | 2023 | 465,000 | — | 512,262 | 9,900 | 987,162 | | | 2022 | 445,000 | — | 1,255,755 | 9,150 | 1,709,905 | | Tina Cessna Senior Vice President, Engineering | 2023 | 396,000 | — | 452,788 | 9,900 | 858,688 |
Summary Compensation Table
| (1) The amounts in this column represent the aggregate grant date fair value of restricted stock units (RSUs) granted to the officer, computed in accordance with FASB ASC Topic No. 718. See the notes to our financial statements included in our Annual Report on Form 10-K, as filed with the Securities and Exchange Commission on April 1, 2024, for a discussion of the assumptions made by us in determining the grant date fair value of our equity awards. |
Summary Compensation Table
| (2) The RSU awards for 2022 includes the payout from the Company’s 2022 annual bonus plan, which was paid in the form of fully vested RSUs. |
Summary Compensation Table
| (3) The RSU awards for 2023 includes the payout from the Company’s 2023 annual bonus plan, which was paid in the form of fully vested RSUs. |
Summary Compensation Table
| (4) Reflects the Company’s contributions under the safe harbor provisions of our 401(k) Plan generally available to all employees as a percentage of cash compensation. |
Outstanding Equity Awards at 2023 Year-End
Outstanding Equity Awards at 2023 Year-End The following table sets forth information regarding each unexercised option and all unvested stock held by each of our named executive officers as of December 31, 2023.
Outstanding Equity Awards at 2023 Year-End
| | Option Awards | | | | | Stock Awards | | | | | Number of Underlying Unexercised Options | | | | | | | Name | Grant Date | Exercisable (#) | Unexercisable (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That have not Vested (#) | Market Value of Shares or Units of Stock That Have not Vested ($) | | Gleb Budman Chief Executive Officer and Chairperson | — | — | — | — | — | — | — | | Frank Patchel Chief Financial Officer | 4/21/2020 | 246,989 | 19,070 | $2.61 | 4/20/2030(1) | | | | | 3/24/2022 | — | — | — | — | 60,976 | $684,151 | | | 7/27/2023 | — | — | — | — | 68,924 | $331,524 | | Tina Cessna Senior Vice President, Engineering | 10/18/2018 | 105,279 | — | 2.54 | 10/17/2028(2) | — | — | | | 10/28/2019 | 25,560 | — | 2.61 | 10/27/2029(2) | — | — | | | 12/10/2020 | 28,658 | 4,102 | 3.73 | 12/9/2030(2) | — | — | | | 6/28/2021 | 31,268 | 18,771 | 8.09 | 6/27/2031(2) | — | — | | | 3/24/2022 | — | — | — | — | 60,976 | $684,151 | | | 7/27/2023 | — | — | — | — | 61,274 | $294,728 |
Outstanding Equity Awards at 2023 Year-End
| (1) Twenty-five percent of the option vests and becomes exercisable following the completion by Mr. Patchel of 12 months of continuous service following the Vesting Commencement Date indicated above, with an additional 1/48th of the option vesting and becoming exercisable following the completion of each of 36 months of additional service thereafter. |
Outstanding Equity Awards at 2023 Year-End
| (2) Twenty-five percent of the option vests and becomes exercisable following the completion by Ms. Cessna of 12 months of continuous service following the Vesting Commencement Date indicated above, with an additional 1/48th of the option vesting and becoming exercisable following the completion of each of 36 months of additional service thereafter. |