DEF 14A of Netflix Inc, Apr 23, 2018

DEF 14A of Netflix Inc

Filed Apr 23, 2018 · FY20170001193125-18-125771

Open on EDGAR

  1. Directors Not Standing For Election

    Directors Not Standing For Election The members of the Board whose terms or directorships do not expire at the Annual Meeting and who are not standing for election at this year’s Annual Meeting are set forth below:

  2. Directors Not Standing For Election

    | Name | Age | Class/Term Expiration | | Timothy M. Haley | 63 | Class II/2019 | | Leslie Kilgore | 52 | Class II/2019 | | Ann Mather | 58 | Class II/2019 | | Susan Rice | 53 | Class II/2019 | | Reed Hastings | 57 | Class III/2020 | | Jay C. Hoag | 59 | Class III/2020 | | A. George (Skip) Battle | 74 | Class III/2020 |

  3. Directors Not Standing For Election

    Each of the directors has extensive business experience, education and personal skills in their respective fields that qualify them to serve as an effective Board member. The specific experience, qualifications and skills of each director is set forth below. Timothy M. Haley has served as one of the Company’s directors since 1998. Mr. Haley is a co-founder of Redpoint Ventures, a venture capital firm, and has been a Managing Director of the firm since October 1999. Mr. Haley has been a Managing Director of Institutional Venture Partners, a venture capital firm, since February 1998. From June 1986 to February 1998, Mr. Haley was the President of Haley Associates, an executive recruiting firm in the high technology industry. Mr. Haley currently serves on the board of directors of several private companies. Mr. Haley holds a B.A. from Santa Clara University. As a venture capital investor, Mr. Haley brings strategic and financial experience to the Board. He has evaluated, invested in and served as a board member on numerous companies. His executive recruiting background also provides the Board with insight into talent selection and management. Leslie Kilgore has served as one of the Company’s directors since 2012. From 2010 to 2016, Ms. Kilgore was a director of LinkedIn Corporation and served as chair on its compensation committee. Ms. Kilgore served as the Company’s Chief Marketing Officer (formerly Vice President of Marketing) from 2000 until her resignation in February 2012. From February 1999 to March 2000, Ms. Kilgore served as Director of Marketing for Amazon.com, Inc., an internet retailer. Ms. Kilgore served as a brand manager for The Procter & Gamble Company, a manufacturer and marketer of consumer products, from August 1992 to February 1999. Ms. Kilgore holds an M.B.A. from the Stanford University Graduate School of Business and a B.S. from The Wharton School of Business at the University of Pennsylvania. Ms. Kilgore’s numerous managerial positions provide strategic and operational experience to the Board. Her experience as a marketing executive with internet retailers and consumer product companies provides a unique business perspective. As the former Chief Marketing Officer of Netflix, Ms. Kilgore deeply understands the Netflix business and is able to bring years of marketing experience to the Board. Ann Mather has served as one of the Company’s directors since 2010. Ms. Mather has also been a member of the board of directors of: Glu Mobile Inc., a publisher of mobile games, since September 2005 and serves on its nominating and governance committee; Google, Inc., since November 2005 and serves as chair of its audit committee; MGM Holdings Inc. (“MGM”), the independent, privately-held motion picture, television, home video, and theatrical production and distribution company, since 2010; Shutterfly, Inc., a manufacturer and digital retailer of personalized products and services, since May 2013; and Arista Networks, a provider of cloud networking services, since July 2013, and serves on its audit committee. Ms. Mather has also been an independent trustee to the Dodge & Cox Funds board of trustees since May 2011. Ms. Mather was previously a director of: Central European Media Enterprises Group, a developer and operator of national commercial television channels and stations in Central and Eastern Europe, from 2004 to 2009; Zappos.com, Inc., a privately held, online retailer, until it was acquired by Amazon.com, Inc. in 2009; Ariat International, Inc., a privately-held manufacturer of footwear for equestrian athletes, from 2005 to 2012; MoneyGram International, a global payment services company, and served as chair of its audit committee, from 2010 to 2013; and Solazyme, Inc., a renewable oil and bioproducts company, from 2011 to 2014. From 1999 to 2004, Ms. Mather was Executive Vice President and Chief Financial Officer of Pixar, a computer animation studio. Prior to her service at Pixar, Ms. Mather was Executive Vice President and Chief Financial Officer of Village Roadshow Pictures, the film production division of Village Roadshow Limited. From 1993 to 1999, she held various executive positions at The Walt Disney Company, including Senior Vice President of Finance and Administration for its Buena Vista International Theatrical Division. Ms. Mather was made an Honorary Fellow of Sidney Sussex College Cambridge in October 2016. Ms. Mather holds a Master of Arts degree from Cambridge University. Ms. Mather’s numerous managerial positions and her service on several public company boards provides strategic, operational and corporate governance experience to the Board. Her experience as an executive with several major media companies provides unique business perspective. As a former chief financial officer and senior finance executive at major corporations and her service on the audit committee of several publicly traded companies, Ms. Mather brings financial and accounting expertise to the Board. Susan Rice joined the Company’s Board of Directors in 2018. Ambassador Rice is a former US National Security Advisor and Ambassador to the United Nations. She is currently a Distinguished Visiting Research Fellow at American University’s School of International Service, Non-Resident Senior Fellow at the Belfer Center for Science and International Affairs at Harvard’s Kennedy School of Government, and Contributing Opinion Writer for the New York Times. From 2013-2017, Ambassador Rice directed the National Security Council staff, chaired the Cabinet-level National Security Principals committee, provided the daily national security briefing to President Barack Obama, and was responsible for the formulation, coordination and implementation of all aspects of the administration’s foreign and national security policy, intelligence and military efforts. From 2009 to 2013, she served as the US Permanent Representative to the United Nations and as a cabinet member. Ambassador Rice received her Master’s degree (M.Phil.) and PhD (D.Phil.) in International Relations from New College, Oxford University, England, where she was a Rhodes Scholar, and her BA in History with honors from Stanford University in 1986. In 2017, French President Francois Hollande presented Ambassador Rice with the Award of Commander, the Legion of Honor of France, for her contributions to Franco-American relations. As a US diplomat and National Security Advisor, Ambassador Rice brings her unique experience in government affairs and public policy matters to the Board. Reed Hastings co-founded Netflix in 1997 and has served as Chairman of the Board since inception. In 1991, Mr. Hastings founded Pure Software, which made tools for software developers. After a 1995 IPO, and several acquisitions, Pure was acquired by Rational Software in 1997. Mr. Hastings is an active educational philanthropist and served on the California State Board of Education from 2000 to 2004. He is currently on the board of several educational organizations including CCSA, Dreambox Learning, KIPP, and Pahara. Mr. Hastings is also a board member of Facebook, and was on the board of Microsoft from 2007 to 2012. Mr. Hastings received a BA from Bowdoin College in 1983, and an MSCS in Artificial Intelligence from Stanford University in 1988. Between Bowdoin and Stanford, Mr. Hastings served in the Peace Corps as a high school math teacher in Swaziland. As Co-founder and Chief Executive Officer of Netflix, Mr. Hastings deeply understands the technology and business of Netflix. He brings strategic and operational insight to the Board. Mr. Hastings is also a software engineer and has unique management and industry insights.

  4. Directors Not Standing For Election

    Jay C. Hoag has served as one of the Company’s directors since 1999. Since 1995, Mr. Hoag has served as a founding General Partner at Technology Crossover Ventures, a venture capital firm. Mr. Hoag serves on the board of directors of Electronic Arts, Inc. and Zillow Group, Inc. and several private companies. Mr. Hoag is on the Investment Advisory Committee at the University of Michigan, the Board of Trustees of Northwestern University, and the Board of Trust at the Vanderbilt University. Previously, Mr. Hoag has served on the board of directors of numerous other public and private companies. Mr. Hoag holds an M.B.A. from the University of Michigan and a B.A. from Northwestern University. As a venture capital investor, Mr. Hoag brings strategic insights and financial experience to the Board. He has evaluated, invested in and served as a board member on numerous companies, both public and private, and is familiar with a full range of corporate and board functions. His many years of experience in helping companies shape and implement strategy provide the Board with unique perspectives on matters such as risk management, corporate governance, talent selection and management. A. George (Skip) Battle has served as one of the Company’s directors since 2005. Mr. Battle was previously Executive Chairman of the Board of Ask Jeeves, Inc. which was acquired by IAC/InterActiveCorp in July 2005. He was Chief Executive Officer of Ask Jeeves from 2000 to 2003. From 1968 until his retirement in 1995, Mr. Battle served in management roles at Arthur Andersen LLP and then Andersen Consulting LLP (now Accenture), where he became worldwide managing partner of market development and a member of the firm’s executive committee. Educated at Dartmouth College and the Stanford Graduate School of Business, Mr. Battle currently serves as Chairman of the Board of Fair Isaac Corporation and as a director of Workday, Inc. and Expedia, Inc. He was previously a director of Advent Software, Inc., OpenTable, Inc., the Masters Select family of mutual funds, and LinkedIn Corporation. Mr. Battle brings business insight and experience to the Board. He was a business consultant for more than 25 years, has served as a chief executive officer and currently serves on a number of boards. As such, he brings to the Board strategic, operational, financial and corporate governance experience.

  5. Consideration of Director Nominees

    Consideration of Director Nominees

  6. Stockholder Nominees

    Stockholder Nominees The Nominating and Governance Committee considers properly submitted stockholder nominations for candidates for membership on the Board as described below under “Identifying and Evaluating Nominees for Directors.” Any stockholder nominations proposed for consideration by the Nominating and Governance Committee should include the nominee’s name and qualifications for Board membership. In addition, they should be submitted within the time frame as specified under “Stockholder Proposals” above and mailed to: Netflix, Inc., 100 Winchester Circle, Los Gatos, California 95032, Attention: Secretary.

  7. Director Qualifications

    Director Qualifications In discharging its responsibilities to nominate candidates for election to the Board, the Nominating and Governance Committee has not specified any minimum qualifications for serving on the Board. However, the Nominating and Governance Committee endeavors to evaluate, propose and approve candidates with business experience, diversity as well as personal skills and knowledge with respect to technology, finance, marketing, financial reporting and any other areas that may be expected to contribute to an effective Board. With respect to diversity, the committee may consider such factors as differences in viewpoint, professional experience, education, skills and other individual qualifications and attributes that contribute to board heterogeneity, including characteristics such as gender, race and national origin.

  8. Identifying and Evaluating Nominees for Directors

    Identifying and Evaluating Nominees for Directors The Nominating and Governance Committee utilizes a variety of methods for identifying and evaluating nominees for director. Candidates may come to the attention of the Nominating and Governance Committee through management, current Board members, stockholders or other persons. These candidates are evaluated at meetings of the Nominating and Governance Committee as necessary and discussed by the members of the Nominating and Governance Committee from time to time. Candidates may be considered at any point during the year. As described above, the Nominating and Governance Committee considers properly submitted stockholder nominations for candidates for the Board. Following verification of the stockholder status of persons proposing candidates, recommendations are aggregated and considered by the Nominating and Governance Committee. If any materials are provided by a stockholder in connection with the nomination of a director candidate, such materials are forwarded to the Nominating and Governance Committee. The Nominating and Governance Committee also reviews materials provided by professional search firms or other parties in connection with a nominee who is not proposed by a stockholder.

  9. Determining Executive Compensation

    The Chief Executive Officer, in consultation with the Chief Talent Officer, reviews comparative data derived from market research and publicly available information for each of the Named Executive Officers1. The Chief Executive Officer then makes recommendations to the Compensation Committee regarding compensation for each Named Executive Officer. The Compensation Committee reviews and discusses the information and then determines a dollar-denominated amount available for allocation to the compensation components described above (“allocatable compensation”) for each Named Executive Officer, as it deems appropriate. The Chief Executive Officer’s compensation is determined by the Compensation Committee outside the presence of the Chief Executive Officer. The Committee’s decision regarding compensation for the Chief Executive Officer is based on the philosophy outlined above and includes a review of comparative data and consideration of the accomplishments of the Chief Executive Officer in developing the business strategy for the Company, the performance of the Company relative to this strategy and his ability to attract and retain senior management. In establishing the Chief Executive Officer’s compensation, the Compensation Committee is also mindful of the results of the stockholder’s Advisory Vote on Executive Compensation for the prior year. In determining compensation for 2017, the Compensation Committee retained Compensia, a management consulting firm providing executive compensation advisory services, to help the Committee assess the competitiveness of the Chief Executive Officer’s compensation, obtain a general understanding of chief executive compensation practices in the marketplace and as a resource for its deliberations concerning the Chief Executive Officer’s specific compensation. The Compensation Committee did not use the information from Compensia, however, with the goal of setting a specific target compensation level based upon percentiles derived from such other companies. In 2017, the Compensation Committee worked with Compensia in determining an appropriate peer group of companies. The peer group reflected the Company’s continued orientation toward media companies and consumer-facing technology companies. The peer group for 2017 was comprised of the following companies: Activision Blizzard, Adobe Systems, AMC Networks, CBS, Discovery Communications, Dolby Laboratories, eBay, Electronic Arts, Lions Gate Entertainment, PayPal Holdings, salesforce.com, Scripps Networks Interactive, Sirius XM Holdings, The Priceline Group, Time Warner, Twenty-first Century Fox, Twitter, Viacom, Walt Disney and Workday. For 2018, the Compensation Committee again worked with Compensia to determine the appropriate peer group of companies for the Company. The peer group for 2018 is comprised of the following companies: Activision Blizzard, Adobe Systems, AMC Networks, CBS, Discovery Communications, DISH Network, eBay, Electronic Arts, Lions Gate Entertainment, PayPal Holdings, salesforce.com, Scripps Networks Interactive, Sirius XM Holdings, The Priceline Group, Time Warner, Twenty-first Century Fox, Twitter, Viacom, Walt Disney and Workday. Total fees paid to Compensia were less than $120,000 in each year. With respect to each of the Named Executive Officers, in determining compensation, the Compensation Committee considered the Company’s compensation philosophy as outlined above, comparative market data and specific factors relative to each Named Executive Officer’s responsibilities and performance. The Company does not specifically benchmark compensation for its Named Executive Officers in terms of picking a particular percentile relative to other people with similar titles at peer group companies. The Company believes that many subjective factors unique to each Named Executive Officer’s responsibilities and performance are not adequately reflected or otherwise accounted for in a percentile-based compensation determination.

  10. Elements of Executive Compensation

    Elements of Executive Compensation In 2017, after determining the allocatable compensation for each Named Executive Officer by the method described above, such amount for each individual was divided into the three key components of salary, stock options and performance-based target bonuses. This allocation was made pursuant to the compensation preferences of each Named Executive Officer, who allocated compensation between cash and stock options; provided however, that the salary component for each Named Executive Officer could not exceed $1 million, except for Mr. Wells who was excluded from the applicable IRS regulations such that the $1 million ceiling on salary did not apply to him. Any amount in cash above $1 million that was not otherwise allocated by a Named Executive Officer to stock options was allocated to a target performance bonus pursuant to the performance-based bonus program (discussed below). The amount allocated to salary was considered cash compensation and paid through payroll during 2017 on a bi-weekly basis. The performance-based bonus program was discontinued for 2018. The amount allocated to stock options is referred to as the stock option allocation. Starting in 2015, the Company also provides a minimum annual stock option allowance (equal to 5% of the Named Executive Officer’s allocatable compensation) which is added to the amount allocated to stock options by the Named Executive Officer in the manner described above. While the stock option allocation is expressed in a dollar denomination, the stock option allocation is used by the Company only to calculate the number of stock options to be granted in the manner described below. The stock option allocation is not available to the employees as cash compensation, except where an employee who has allocated a portion of their compensation towards stock options receives severance payments and as otherwise set forth in the Executive Severance and Retention Incentive Plan described below. After the stock option allocation is established, the Named Executive Officers receive monthly option grants pursuant to the Company’s monthly option grant program. Under this program, the Named Executive Officers receive, on the first trading day of the month, fully vested options granted at fair market value as reflected by the closing price on the date of the option grant. The number of stock options to be granted monthly will fluctuate based on the fair market value on the date of the option grant. The actual number of options granted to the Named Executive Officers was determined by the following formula: the monthly dollar amount of the stock option allocation / ([fair market value on the date of option grant] * 0.40). For stock option accounting purposes, the dollar value of stock options granted by the Company, as reflected in the Summary Executive Compensation table, below, are appreciably higher than the dollar value of the stock option allocation (please compare “Summary Executive Compensation” table provided in this Proxy Statement with the table below). Furthermore, because the stock options are granted at fair market value on the date of the option grant and are not generally transferable, they are only of value to the recipient through an increase in the market value of the Company’s common stock, thereby linking that element of compensation to Company performance. As shown in the table below, the Company’s Named Executive Officers elected to receive a significant portion of their compensation in the form of stock options. The Company believes that equity ownership, including stock and stock options, helps align the interest of the Named Executive Officers with those of the Company’s stockholders and is a good mechanism to link executive compensation to long-term company performance. In 2016 and 2017, the compensation components for the Named Executive Officers were allocated as follows (please see the “Summary Executive Compensation” table provided in this Proxy Statement for a complete description of the compensation of the Named Executive Officers in 2016 and 2017):

  11. Elements of Executive Compensation

    | Name and Position | 2016 Annual Salary | 2016 Annual Stock Option Allocation | 2016 Monthly Stock Option Allocation | 2016 Estimated Target Bonus | | Reed Hastings | | | | | | Chief Executive Officer and Chairman of the Board | $900,000 | $19,050,000 | $1,587,500 | $— | | Greg Peters | | | | | | Chief Product Officer | 1,000,000 | 3,275,000 | 272,917 | 1,500,000 | | Ted Sarandos | | | | | | Chief Content Officer | 1,000,000 | 11,800,000 | 983,333 | 4,000,000 | | David Wells | | | | | | Chief Financial Officer | 2,400,000 | 1,800,000 | 150,000 | — | | Neil Hunt | | | | | | former Chief Product Officer | 1,000,000 | 2,150,000 | 179,167 | 5,250,000 |

  12. Elements of Executive Compensation

    | Name and Position | 2017 Annual Salary | 2017 Annual Stock Option Allocation | 2017 Monthly Stock Option Allocation | 2017 Estimated Target Bonus | | Reed Hastings | | | | | | Chief Executive Officer and Chairman of the Board | $850,000 | $21,200,000 | $1,766,667 | $— | | David Hyman | | | | | | General Counsel (allocation effective Jan 1, 2017, annualized) | 3,300,000 | 1,215,000 | 101,250 | — | | David Hyman | | | | | | (modified allocation effective July 1, 2017, annualized) | 100,000 | 1,215,000 | 101,250 | 3,200,000 | | Greg Peters | | | | | | Chief Product Officer (allocation effective Jan 1, 2017, annualized) | 1,000,000 | 3,275,000 | 272,917 | 1,500,000 | | Greg Peters | | | | | | (modified allocation effective July 1, 2017, annualized) | 1,000,000 | 3,400,000 | 283,333 | 4,000,000 | | Ted Sarandos | | | | | | Chief Content Officer | 1,000,000 | 11,000,000 | 916,667 | 9,000,000 | | David Wells | | | | | | Chief Financial Officer | 2,500,000 | 1,910,000 | 159,167 | — | | Neil Hunt | | | | | | former Chief Product Officer | 1,000,000 | 2,410,000 | 200,833 | 5,200,000 |

  13. Elements of Executive Compensation

    As reflected in the above table, Mr. Peters received an increase in compensation upon becoming Chief Product Officer. Further, in connection with his departure from Netflix, Mr. Hunt entered into Netflix’s standard form of release agreement with Netflix which included customary confidentiality and release provisions and received a lump sum cash payment equal to $6,457,500. As described above, the Committee determined that the maximum annual salary payable to any Named Executive Officer (excluding Mr. Wells) for 2017 would be $1 million, with the exception of Mr. Hyman who had received over $1 million in salary at the time he was first included in the performance-bonus program in July 2017. Any portion of a Named Executive Officer’s compensation over $1 million that was not allocated to stock options was allocated to a target bonus to the Named Executive Officer pursuant to our Performance Bonus Plan (the “Plan”), which was approved by stockholders at our 2014 Annual Meeting. The Plan is intended to permit the Company to seek a full federal tax deduction for compensation paid under the Plan, compensation that otherwise might not have been fully tax deductible to the Company if paid as salary. However the portion of salary received by Mr. Hyman above $1 million was not deductible pursuant to IRS regulations. At the time of Mr. Hunt’s departure, it was determined that Mr. Hyman would likely be a Named Executive Officer for 2017 and was added to the performance bonus-program, and the majority of the Mr. Hyman’s remaining 2017 cash compensation was thereafter allocated to the target performance bonus component. Under the Plan, bonuses were paid only if the performance goals set by the Committee at the beginning of the applicable performance period were achieved. The actual awards (if any) payable for any performance period varied depending on the extent to which actual performance met, exceeded or fell short of the goals approved by the Committee. The Compensation Committee has the discretion to determine whether a bonus will be paid in the event an executive terminates employment before the bonus is scheduled to be paid. In addition, the Compensation Committee has discretion to decrease (but not increase) the bonuses that otherwise would be paid under the Bonus Plan based on actual performance versus the specified goals. In 2017, the Committee approved Mr. Hunt’s receipt of Q2 2017 bonus under the Performance Bonus Plan although he left the Company on June 23, 2017. For 2017, the Compensation Committee approved four performance periods under the Plan. Each performance period was comprised of one of our fiscal quarters so that, in effect, one performance period always was in effect during 2017. For each performance period, the Committee chose a target bonus for each participant and a goal for the Company’s global streaming revenue for that quarter, as calculated under generally accepted accounting principles and reflected in our publicly-available financial statements. The Committee chose this goal because global streaming revenue is an important metric demonstrating growth of the Company. Under the bonus formula approved by the Committee, the actual bonus earned (if any) would correspond to the percentage of the goal achieved, provided that no bonus would be payable for less than 80% achievement of the goal and the maximum bonus payable would be 120% of the target bonus, even if performance was greater than 120% of the goal. The below table shows the performance goals, the level of achievement of the goals, and the percentage of target bonuses earned for each of the four quarterly performance periods.

  14. Elements of Executive Compensation

    | Performance Goals by Quarter | Q1 | Q2 | Q3 | Q4 | | Goal for Global Streaming Revenue (in thousands) | $2,516,000 | $2,640,000 | $2,859,000 | $3,169,000 | | Actual Global Streaming Revenue (in thousands) | 2,516,000 | 2,671,000 | 2,875,000 | 3,181,000 | | % of Goal Achieved | 100% | 101% | 101% | 100% | | % of Target Bonus Earned | 100% | 101% | 101% | 100% |

  15. Elements of Executive Compensation

    | Name | Q1 | Q2 | Q3 | Q4 | 2017 | | David Hyman | | | | | | | Target Bonus | $— | $— | $800,000 | $800,000 | $1,600,000 | | Actual Bonus | — | — | 808,000 | 800,000 | 1,608,000 | | Greg Peters | | | | | | | Target Bonus | 375,000 | 375,000 | 1,000,000 | 1,000,000 | 2,750,000 | | Actual Bonus | 375,000 | 378,750 | 1,010,000 | 1,000,000 | 2,763,750 | | Ted Sarandos | | | | | | | Target Bonus | 2,250,000 | 2,250,000 | 2,250,000 | 2,250,000 | 9,000,000 | | Actual Bonus | 2,250,000 | 2,272,500 | 2,272,500 | 2,250,000 | 9,045,000 | | Neil Hunt | | | | | | | Target Bonus | 1,300,000 | 1,300,000 | | | 2,600,000 | | Actual Bonus | 1,300,000 | 1,313,000 | | | 2,613,000 |

  16. Elements of Executive Compensation

    | Name and Position | 2018 Annual Salary | 2018 Annual Stock Option Allocation | 2018 Monthly Stock Option Allocation | | Reed Hastings Chief Executive Officer and Chairman of the Board | $700,000 | $28,700,000 | $2,391,667 | | David Hyman General Counsel | 2,500,000 | 3,275,000 | 272,917 | | Greg Peters Chief Product Officer | 6,000,000 | 6,600,000 | 550,000 | | Ted Sarandos Chief Content Officer | 12,000,000 | 14,250,000 | 1,187,500 | | David Wells Chief Financial Officer | 2,800,000 | 2,450,000 | 204,167 |

  17. Elements of Executive Compensation

    Vested stock options granted on or after January 1, 2007 can be exercised up to ten (10) years following grant regardless of employment status. The Company believes that this increase in the life of the options enhances the value of such options for each employee and thereby encourages equity ownership in the Company, which is helpful in aligning the interests of employees with that of the Company. The Company does not believe that staggered vesting of stock options or early expiration of options following termination has a material impact on retention. The Company believes that creating a high-performance culture and providing highly competitive compensation packages are the critical components for retaining employees, including its Named Executive Officers. Across the broader employee base, the Company utilizes salary and stock options as its key compensation components in order to be competitive within the marketplace. Similarly situated companies typically offer employees an equity component as part of their overall compensation and as such, the Company believes it is important to provide this opportunity to its employees, including the Named Executive Officers. By permitting employees to request a customized combination of salary and stock options, the Company believes it is better able to take into consideration personal compensation preferences and thereby offer a more compelling compensation package. In addition, offering grants monthly provides employees with a “dollar-cost averaging” approach to the price of their option grants. Option grants made on an infrequent basis are more susceptible to the whims of market timing and fluctuations. By granting options each month, the Company believes it alleviates to a great extent the arbitrariness of option timing and the potential negative employee issues associated with “underwater” options. Each Named Executive Officer, like all of the Company’s employees, is eligible to receive an additional $15,000 in annual compensation not reflected above that may be used to defray the cost of health care benefits previously paid by the Company. Any portion of this allowance not utilized toward the cost of health care benefits will be paid as salary, up to a maximum of $5,000. In addition to salary and stock options, all exempt employees, including Named Executive Officers, also have the opportunity to participate in the Company’s 401(k) matching program which enables them to receive a dollar-for-dollar Company match of up to 3% of his or her compensation to the 401(k) fund. Mr. Hunt, Mr. Hyman, Mr. Sarandos and Mr. Wells all participated in this program in 2017 and therefore the Company matched the 401(k) contributions as shown in the tables of this Proxy Statement. The Company also maintains a group term life insurance policy for all full-time employees.

  18. Termination-Based Compensation and Change in Control Retention Incentives

    Termination-Based Compensation and Change in Control Retention Incentives The Named Executive Officers are beneficiaries of the Company’s Amended and Restated Executive Severance and Retention Incentive Plan (“Severance Plan”). Under this Severance Plan, each employee of the Company at the level of Vice President or higher (“Covered Executive”) is entitled to a severance benefit upon termination of employment (other than for cause, death or permanent disability) so long as he or she signs a waiver and release of claims and an agreement not to disparage the Company, its directors or its officers in a form reasonably satisfactory to the Company. The severance benefit consists of a lump sum cash payment equal to nine (9) months of allocatable compensation, or, for newly hired Covered Executives only, a cash payment equal to 24 months of allocatable compensation, which is reduced by an amount equal to one (1) month of allocatable compensation for each month of tenure at the Company for the first 15 months of continuous employment following hire by the Company, such that the minimum benefit for such newly hired Covered Executives is the cash equivalent of nine (9) months of allocatable compensation. The right to receive a severance benefit terminates upon a change in control transaction, so that the Covered Executives under the Severance Plan are not entitled to both a change in control benefit as well as a severance benefit. In lieu of the severance benefit described above, the Severance Plan provides that employees covered by the Severance Plan who are employed by the Company on the date of a change in control transaction are entitled to receive a lump sum cash payment equal to twelve (12) months of allocatable compensation regardless of whether their employment terminates. The Company also maintains a plan for its director level employees (the “Director Plan”) that provides those employees who are employed by the Company on the date of a change in control transaction with a lump sum cash payment equal to six (6) months of allocatable compensation, regardless of whether their employment terminates. While director level employees are not guaranteed any severance upon termination of employment, to the extent any severance is provided to a director level employee, payment associated with the change in control will be in lieu of or otherwise offset against any such severance payment. The Company believes that it is appropriate to make such payment upon the single-trigger event of a change in control in order to reduce distractions associated with the uncertainty surrounding change in control transactions and to reduce potential conflicts that might otherwise arise when a Company executive must rely on the decisions of the acquiring company for either continued employment or severance. The benefits owing under the Severance Plan or Director Plan are to be paid to an individual covered under the applicable plan by the Company as soon as administratively practicable following the completion of all conditions to the payment, but in no event more than two and one half months following the date of the triggering event. The Company believes that benefits under the Company’s Amended and Restated Executive Severance and Retention Incentive Plan are consistent with similar benefits offered to executive officers of similarly situated companies and moreover, the Plan is an important element in advancing the Company’s overall compensation philosophy of attracting and retaining outstanding performers. Each of the terms “allocatable compensation,” “cause” and “change in control” are defined in the plan, a copy of which is attached as Exhibit 10.14 to the Company’s Form 10-Q filed on July 19, 2017.

  19. Tax Considerations

    Tax Considerations Section 162(m) of the Internal Revenue Code was among the provisions that were amended pursuant to tax reform legislation that was signed into law in December 2017. The prior version of section 162(m) generally disallowed a tax deduction for compensation that we paid to our Chief Executive Officer or any of the next three most highly compensated executive officers (excluding the Chief Financial Officer) to the extent that the compensation for any such individual exceeded $1 million in any taxable year. However, this deduction limitation did not apply to compensation that was “performance-based” under Section 162(m). The Company’s stock options grants were intended to qualify as performance-based under Section 162(m). Similarly, bonuses earned and paid under the Performance Bonus Plan were intended to qualify as performance-based. Amounts paid as salary did not qualify as performance-based. In establishing compensation for 2017, the Compensation Committee considered the potential impact of the prior version of Section 162(m) on executive officer compensation. For this reason, the Committee chose to cap each Named Executive Officer’s salary (other than the Chief Financial Officer) at $1 million for 2017, with the exception of Mr. Hyman who had received over $1 million in salary at the time he first became included in the performance-bonus program. The Tax Cuts and Jobs Act (the “Tax Act”), which became law on December 22, 2017, amended Section 162(m) to eliminate the deductibility of performance-based compensation over $1 million, but included a transition rule with respect to compensation that is provided pursuant to a written binding contract in effect on November 2, 2017 and not materially modified after that date. In addition, the 2017 amendments also made the Chief Financial Officer subject to section 162(m). The Company will continue to grant stock options in 2018, although such grants will not be deductible to the extent the total compensation for each officer subject to the rules of Section 162(m) exceeds $1 million in the year in which the stock options are exercised. Pursuant to the transition rule, stock option grants that were granted prior to 2018 will generally still be eligible for the prior rules under Section 162(m) and will be deductible as performance-based compensation. The Committee considers the tax impact of the Company’s compensation programs, and will generally seek to preserve the deductibility of any performance-based compensation that is subject to the transition rule of the Tax Act, to the extent practicable and in the best interests of the Company and its stockholders.

  20. Summary Executive Compensation

    | Name and Principal Position | Year | Salary ($) | Option Awards ($) (1) | Non-Equity Incentive Plan Compensation ($) (2) | All Other Compensation ($) | Total ($) | | Reed Hastings | 2017 | $850,000 | $23,527,499 | $— | $— | $24,377,499 | | Chief Executive Officer, President, Chairman of the Board | 2016 | 900,000 | 22,277,733 | — | — | 23,177,733 | | | 2015 | 1,115,385 | 15,496,797 | — | — | 16,612,182 | | Neil Hunt | 2017 | 576,923 | 1,315,595 | 2,613,000 | 6,465,600 (3) | 10,971,118 | | former Chief Product Officer | 2016 | 1,000,000 | 2,549,204 | 5,250,000 | 7,950 (4) | 8,807,154 | | | 2015 | 1,067,308 | 2,368,693 | 4,987,500 | 7,950 (5) | 8,431,451 | | David Hyman (6) | 2017 | 1,761,538 | 1,435,074 | 1,608,000 | 309,027 (7) | 5,113,639 | | General Counsel | | | | | | | | Greg Peters | 2017 | 1,000,000 | 3,725,022 | 2,763,750 | 1,748,718 (8) | 9,237,490 | | Chief Product Officer | 2016 | 1,000,000 | 3,869,152 | 1,500,000 | 1,660,135 (9) | 8,029,287 | | | 2015 | 1,038,462 | 3,156,900 | 997,500 | 414,087 (10) | 5,606,949 | | Ted Sarandos | 2017 | 1,000,000 | 12,389,532 | 9,045,000 | 8,100 (11) | 22,442,632 | | Chief Content Officer | 2016 | 1,000,000 | 13,917,568 | 4,000,000 | 5,538 (12) | 18,923,106 | | | 2015 | 1,107,692 | 10,877,040 | 1,995,000 | 6,038 (13) | 13,985,770 | | David Wells | 2017 | 2,500,000 | 2,127,673 | — | 553,641 (14) | 5,181,314 | | Chief Financial Officer | 2016 | 2,400,000 | 2,145,314 | — | 1,549,136 (15) | 6,094,450 | | | 2015 | 2,036,539 | 1,928,575 | — | 198,300 (16) | 4,163,414 |

  21. Summary Executive Compensation

    | Dollar amounts in the Option Awards column reflect the grant date fair value with respect to stock options during the respective fiscal year. The dollar amounts set forth in the Option Awards column are different than the stock option allocation amounts described in the section above entitled “Compensation Discussion and Analysis” because the stock option allocation amounts are reflective of the total compensation amount attributable to stock option grants, not the accounting valuation. For a discussion of the assumptions made in the valuation reflected in the Option Awards column, refer to Note 7 to the Company’s consolidated financial statements for the fiscal year ended December 31, 2017 and the discussion under Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates—Stock-Based Compensation” in the Company’s Form 10-K filed with the SEC on February 5, 2018.(1) |

  22. Summary Executive Compensation

    | In accordance with the Company’s Performance Bonus Plan as approved by the Compensation Committee, the dollar amounts represent the amount earned in 2017 for the achievement of the established performance goals.(2) |

  23. Summary Executive Compensation

    | Includes $8,100 representing our matching contribution made under our 401(k) plan and $6,457,500 in connection with his departure from Netflix.(3) |

  24. Summary Executive Compensation

    | Includes $7,950 representing our matching contribution made under our 401(k) plan.(4) |

  25. Summary Executive Compensation

    | Includes $7,950 representing our matching contribution made under our 401(k) plan.(5) |

  26. Summary Executive Compensation

    | Mr. Hyman was not a Named Executive Officer for 2016 and 2017.(6) |

  27. Summary Executive Compensation

    | Includes $8,100 representing our matching contribution made under our 401(k) plan and payment of $300,155 for living allowances, taxes paid by the Company to tax equalize the employee for an expatriate assignment and $772 of commuting expenses.(7) |

  28. Summary Executive Compensation

    | Includes $1,746,105 for living allowances and taxes paid by the Company to tax equalize the employee for an expatriate assignment and $2,613 of commuting expenses.(8) |

  29. Summary Executive Compensation

    | Includes $1,660,135 for living allowances and taxes paid by the Company to tax equalize the employee for an expatriate assignment.(9) |

  30. Summary Executive Compensation

    | Includes $414,087 for living allowances and taxes paid by the Company to tax equalize the employee for an expatriate assignment.(10) |

  31. Summary Executive Compensation

    | Includes $8,100 representing our matching contribution made under our 401(k) plan.(11) |

  32. Summary Executive Compensation

    | Includes $5,538 representing our matching contribution made under our 401(k) plan.(12) |

  33. Summary Executive Compensation

    | Includes $5,538 representing our matching contribution made under our 401(k) plan and a $500 auto allowance.(13) |

  34. Summary Executive Compensation

    | Includes $8,100 representing our matching contribution made under our 401(k) plan and payment of $545,541 for living allowances and taxes paid by the Company to tax equalize the employee for an expatriate assignment.(14) |

  35. Summary Executive Compensation

    | Includes $7,950 representing our matching contribution made under our 401(k) plan and payment of $1,541,186 for living allowances and taxes paid by the Company to tax equalize the employee for an expatriate assignment.(15) |

  36. Summary Executive Compensation

    | Includes $7,950 representing our matching contribution made under our 401(k) plan and payment of $190,350 for living allowances and taxes paid by the Company to tax equalize the employee for an expatriate assignment.(16) |

  37. Grants of Plan-Based Awards

    Grants of Plan-Based Awards The following table sets forth information concerning grants of awards made to the Named Executive Officers during 2017. As described above in “Compensation Discussion and Analysis,” the Company grants employees, including the Named Executive Officers, fully vested stock options on a monthly basis. These are the only equity awards made to the Named Executive Officers. Also as described above in “Compensation Discussion and Analysis,” in 2017, the Company granted performance-based cash compensation to each of the Named Executive Officers who allocated more than $1 million of their allocatable compensation to cash. These cash performance-based awards were granted on a quarterly basis under the Company’s Performance Bonus Plan. The material terms of these cash incentive and stock option grants, including the formula for determining the number of stock options to be granted, are set forth above in “Compensation Discussion and Analysis.”

  38. Grants of Plan-Based Awards

    | | | Estimated Potential Payouts Under Non-Equity Incentive Plan Awards (1) | | | All Other Option Awards: Number of Securities Underlying Options | Exercise or Base Price of Option Awards | Grant Date Fair Value of Stock and Option Awards | | Name | Grant Date | Threshold ($) | Target ($) | Maximum ($) | (#) | ($/Sh) | ($) | | Reed Hastings | 1/3/2017 | | | | 31,130 | $127.4900 | 1,808,784 | | Reed Hastings | 2/1/2017 | | | | 31,373 | $140.7800 | 2,012,929 | | Reed Hastings | 3/1/2017 | | | | 30,961 | $142.6500 | 2,012,883 | | Reed Hastings | 4/3/2017 | | | | 30,062 | $146.9200 | 1,917,165 | | Reed Hastings | 5/1/2017 | | | | 28,431 | $155.3500 | 1,917,185 | | Reed Hastings | 6/1/2017 | | | | 27,097 | $162.9900 | 1,917,091 | | Reed Hastings | 7/3/2017 | | | | 30,216 | $146.1700 | 1,939,384 | | Reed Hastings | 8/1/2017 | | | | 24,264 | $182.0300 | 1,939,429 | | Reed Hastings | 9/1/2017 | | | | 25,275 | $174.7400 | 1,939,331 | | Reed Hastings | 10/2/2017 | | | | 24,952 | $177.0100 | 2,041,153 | | Reed Hastings | 11/1/2017 | | | | 22,306 | $198.0000 | 2,041,077 | | Reed Hastings | 12/1/2017 | | | | 23,641 | $186.8200 | 2,041,088 | | Neil Hunt | 1/3/2017 | | | | 3,513 | $127.4900 | 204,120 | | Neil Hunt | 1/22/2017 | 1,040,000 | 1,300,000 | 1,560,000 | | | | | Neil Hunt | 2/1/2017 | | | | 3,567 | $140.7800 | 228,863 | | Neil Hunt | 3/1/2017 | | | | 3,519 | $142.6500 | 228,783 | | Neil Hunt | 4/3/2017 | | | | 3,418 | $146.9200 | 217,979 | | Neil Hunt | 4/22/2017 | 1,040,000 | 1,300,000 | 1,560,000 | | | | | Neil Hunt | 5/1/2017 | | | | 3,232 | $155.3500 | 217,943 | | Neil Hunt | 6/1/2017 | | | | 3,080 | $162.9900 | 217,907 | | David Hyman | 1/3/2017 | | | | 3,276 | $127.4900 | 190,349 | | David Hyman | 2/1/2017 | | | | 1,798 | $140.7800 | 115,362 | | David Hyman | 3/1/2017 | | | | 1,775 | $142.6500 | 115,399 | | David Hyman | 4/3/2017 | | | | 1,722 | $146.9200 | 109,818 | | David Hyman | 5/1/2017 | | | | 1,630 | $155.3500 | 109,916 | | David Hyman | 6/1/2017 | | | | 1,553 | $162.9900 | 109,874 | | David Hyman | 7/3/2017 | | | | 1,732 | $146.1700 | 111,167 |

  39. Grants of Plan-Based Awards

    | | | Estimated Potential Payouts Under Non-Equity Incentive Plan Awards (1) | | | All Other Option Awards: Number of Securities Underlying Options | Exercise or Base Price of Option Awards | Grant Date Fair Value of Stock and Option Awards | | Name | Grant Date | Threshold ($) | Target ($) | Maximum ($) | (#) | ($/Sh) | ($) | | David Hyman | 7/23/2017 | 640,000 | 800,000 | 960,000 | | | | | David Hyman | 8/1/2017 | | | | 1,390 | $182.0300 | 111,103 | | David Hyman | 9/1/2017 | | | | 1,449 | $174.7400 | 111,181 | | David Hyman | 10/2/2017 | | | | 1,430 | $177.0100 | 116,978 | | David Hyman | 10/23/2017 | 640,000 | 800,000 | 960,000 | | | | | David Hyman | 11/1/2017 | | | | 1,278 | $198.0000 | 116,941 | | David Hyman | 12/1/2017 | | | | 1,355 | $186.8200 | 116,986 | | Greg Peters | 1/3/2017 | | | | 5,352 | $127.4900 | 310,974 | | Greg Peters | 1/22/2017 | 300,000 | 375,000 | 450,000 | | | | | Greg Peters | 2/1/2017 | | | | 4,846 | $140.7800 | 310,925 | | Greg Peters | 3/1/2017 | | | | 4,783 | $142.6500 | 310,960 | | Greg Peters | 4/3/2017 | | | | 4,644 | $146.9200 | 296,165 | | Greg Peters | 4/22/2017 | 300,000 | 375,000 | 450,000 | | | | | Greg Peters | 5/1/2017 | | | | 4,392 | $155.3500 | 296,165 | | Greg Peters | 6/1/2017 | | | | 4,186 | $162.9900 | 296,156 | | Greg Peters | 7/3/2017 | | | | 4,668 | $146.1700 | 299,611 | | Greg Peters | 7/23/2017 | 800,000 | 1,000,000 | 1,200,000 | | | | | Greg Peters | 8/1/2017 | | | | 3,891 | $182.0300 | 311,009 | | Greg Peters | 9/1/2017 | | | | 4,054 | $174.7400 | 311,060 | | Greg Peters | 10/2/2017 | | | | 4,001 | $177.0100 | 327,295 | | Greg Peters | 10/23/2017 | 800,000 | 1,000,000 | 1,200,000 | | | | | Greg Peters | 11/1/2017 | | | | 3,578 | $198.0000 | 327,400 | | Greg Peters | 12/1/2017 | | | | 3,791 | $186.8200 | 327,303 | | Ted Sarandos | 1/3/2017 | | | | 19,282 | $127.4900 | 1,120,365 | | Ted Sarandos | 1/22/2017 | 1,800,000 | 2,250,000 | 2,700,000 | | | | | Ted Sarandos | 2/1/2017 | | | | 16,279 | $140.7800 | 1,044,480 | | Ted Sarandos | 3/1/2017 | | | | 16,065 | $142.6500 | 1,044,442 | | Ted Sarandos | 4/3/2017 | | | | 15,598 | $146.9200 | 994,742 | | Ted Sarandos | 4/22/2017 | 1,800,000 | 2,250,000 | 2,700,000 | | | | | Ted Sarandos | 5/1/2017 | | | | 14,751 | $155.3500 | 994,703 | | Ted Sarandos | 6/1/2017 | | | | 14,060 | $162.9900 | 994,734 | | Ted Sarandos | 7/3/2017 | | | | 15,679 | $146.1700 | 1,006,341 | | Ted Sarandos | 7/23/2017 | 1,800,000 | 2,250,000 | 2,700,000 | | | | | Ted Sarandos | 8/1/2017 | | | | 12,589 | $182.0300 | 1,006,242 | | Ted Sarandos | 9/1/2017 | | | | 13,115 | $174.7400 | 1,006,303 | | Ted Sarandos | 10/2/2017 | | | | 12,946 | $177.0100 | 1,059,024 | | Ted Sarandos | 10/23/2017 | 1,800,000 | 2,250,000 | 2,700,000 | | | | | Ted Sarandos | 11/1/2017 | | | | 11,574 | $198.0000 | 1,059,062 | | Ted Sarandos | 12/1/2017 | | | | 12,267 | $186.8200 | 1,059,094 | | David Wells | 1/3/2017 | | | | 2,942 | $127.4900 | 170,943 |

  40. Grants of Plan-Based Awards

    | | | Estimated Potential Payouts Under Non-Equity Incentive Plan Awards (1) | | | All Other Option Awards: Number of Securities Underlying Options | Exercise or Base Price of Option Awards | Grant Date Fair Value of Stock and Option Awards | | Name | Grant Date | Threshold ($) | Target ($) | Maximum ($) | (#) | ($/Sh) | ($) | | David Wells | 2/1/2017 | | | | 2,826 | $140.7800 | 181,320 | | David Wells | 3/1/2017 | | | | 2,790 | $142.6500 | 181,388 | | David Wells | 4/3/2017 | | | | 2,708 | $146.9200 | 172,699 | | David Wells | 5/1/2017 | | | | 2,562 | $155.3500 | 172,763 | | David Wells | 6/1/2017 | | | | 2,441 | $162.9900 | 172,699 | | David Wells | 7/3/2017 | | | | 2,722 | $146.1700 | 174,709 | | David Wells | 8/1/2017 | | | | 2,186 | $182.0300 | 174,728 | | David Wells | 9/1/2017 | | | | 2,277 | $174.7400 | 174,712 | | David Wells | 10/2/2017 | | | | 2,248 | $177.0100 | 183,893 | | David Wells | 11/1/2017 | | | | 2,010 | $198.0000 | 183,922 | | David Wells | 12/1/2017 | | | | 2,130 | $186.8200 | 183,897 |

  41. Grants of Plan-Based Awards

    | Amounts in this column reflect performance-based cash compensation approved pursuant to the Performance Bonus Plan. Amounts in the “Threshold” column reflect 80% achievement of the applicable performance goal, below which no amount is payable. Amounts in the “Target” and “Maximum” columns reflect 100% and 120% achievement of the performance goal, respectively.(1) |

  42. Outstanding Equity Awards at Fiscal Year-End

    Outstanding Equity Awards at Fiscal Year-End The following table sets forth information concerning equity awards for each Named Executive Officer that remained outstanding as of December 31, 2017. All options are fully vested.

  43. Outstanding Equity Awards at Fiscal Year-End

    | | Option Awards | | | | Name | Number of Securities Underlying Unexercised Options: Exercisable | Option Exercise Price ($) | Option Expiration Date | | Reed Hastings | 75,369 | $4.4200 | 3/3/2018 | | Reed Hastings | 63,889 | $5.2157 | 4/1/2018 | | Reed Hastings | 75,271 | $4.4286 | 5/1/2018 | | Reed Hastings | 75,558 | $4.4129 | 6/2/2018 | | Reed Hastings | 86,037 | $3.8714 | 7/1/2018 | | Reed Hastings | 79,800 | $4.1743 | 8/1/2018 | | Reed Hastings | 75,656 | $4.4057 | 9/2/2018 | | Reed Hastings | 77,672 | $4.2914 | 10/1/2018 | | Reed Hastings | 99,883 | $3.3371 | 11/3/2018 | | Reed Hastings | 105,868 | $3.1486 | 12/1/2018 | | Reed Hastings | 78,092 | $4.2671 | 1/2/2019 | | Reed Hastings | 63,147 | $5.2786 | 2/2/2019 | | Reed Hastings | 67,907 | $4.9071 | 3/2/2019 | | Reed Hastings | 54,418 | $6.1243 | 4/1/2019 | | Reed Hastings | 52,458 | $6.3543 | 5/1/2019 | | Reed Hastings | 56,966 | $5.8486 | 6/1/2019 | | Reed Hastings | 57,414 | $5.8029 | 7/1/2019 | | Reed Hastings | 51,898 | $6.4243 | 8/3/2019 | | Reed Hastings | 55,342 | $6.0214 | 9/1/2019 | | Reed Hastings | 52,269 | $6.3743 | 10/1/2019 | | Reed Hastings | 43,372 | $7.6857 | 11/2/2019 | | Reed Hastings | 40,061 | $8.3186 | 12/1/2019 | | Reed Hastings | 54,516 | $7.6400 | 1/4/2020 | | Reed Hastings | 95,578 | $8.7186 | 2/1/2020 | | Reed Hastings | 83,692 | $9.9571 | 3/1/2020 | | Reed Hastings | 77,777 | $10.7143 | 4/1/2020 | | Reed Hastings | 57,197 | $14.5700 | 5/3/2020 | | Reed Hastings | 54,369 | $15.3271 | 6/1/2020 | | Reed Hastings | 53,193 | $15.6657 | 7/1/2020 | | Reed Hastings | 57,260 | $14.5543 | 8/2/2020 | | Reed Hastings | 43,239 | $19.2729 | 9/1/2020 | | Reed Hastings | 37,716 | $22.0943 | 10/1/2020 | | Reed Hastings | 34,853 | $23.9100 | 11/1/2020 | | Reed Hastings | 29,148 | $28.5914 | 12/1/2020 |

  44. Outstanding Equity Awards at Fiscal Year-End

    | | Option Awards | | | | Name | Number of Securities Underlying Unexercised Options: Exercisable | Option Exercise Price ($) | Option Expiration Date | | Reed Hastings | 32,697 | $25.4871 | 1/3/2021 | | Reed Hastings | 41,097 | $30.4143 | 2/1/2021 | | Reed Hastings | 42,763 | $29.2329 | 3/1/2021 | | Reed Hastings | 36,141 | $34.5843 | 4/1/2021 | | Reed Hastings | 36,890 | $33.8843 | 5/2/2021 | | Reed Hastings | 32,739 | $38.1800 | 6/1/2021 | | Reed Hastings | 32,648 | $38.2843 | 7/1/2021 | | Reed Hastings | 33,222 | $37.6257 | 8/1/2021 | | Reed Hastings | 37,513 | $33.3243 | 9/1/2021 | | Reed Hastings | 77,266 | $16.1786 | 10/3/2021 | | Reed Hastings | 109,249 | $11.4414 | 11/1/2021 | | Reed Hastings | 130,263 | $9.5957 | 12/1/2021 | | Reed Hastings | 121,121 | $10.3200 | 1/3/2022 | | Reed Hastings | 35,581 | $17.5671 | 2/1/2022 | | Reed Hastings | 38,801 | $16.1071 | 3/1/2022 | | Reed Hastings | 38,388 | $16.2814 | 4/2/2022 | | Reed Hastings | 53,774 | $11.6229 | 5/1/2022 | | Reed Hastings | 69,503 | $8.9929 | 6/1/2022 | | Reed Hastings | 64,477 | $9.6929 | 7/2/2022 | | Reed Hastings | 80,276 | $7.7857 | 8/1/2022 | | Reed Hastings | 78,225 | $7.9900 | 9/4/2022 | | Reed Hastings | 78,057 | $8.0071 | 10/1/2022 | | Reed Hastings | 56,315 | $11.0986 | 11/1/2022 | | Reed Hastings | 57,561 | $10.8586 | 12/3/2022 | | Reed Hastings | 47,551 | $13.1443 | 1/2/2023 | | Reed Hastings | 35,399 | $23.5429 | 2/1/2023 | | Reed Hastings | 30,807 | $27.0529 | 3/1/2023 | | Reed Hastings | 31,976 | $26.0614 | 4/1/2023 | | Reed Hastings | 27,398 | $30.4157 | 5/1/2023 | | Reed Hastings | 26,278 | $31.7100 | 6/3/2023 | | Reed Hastings | 26,012 | $32.0400 | 7/1/2023 | | Reed Hastings | 23,415 | $35.5886 | 8/1/2023 | | Reed Hastings | 20,188 | $41.2857 | 9/3/2023 | | Reed Hastings | 17,969 | $46.3743 | 10/1/2023 | | Reed Hastings | 17,717 | $47.0386 | 11/1/2023 | | Reed Hastings | 16,030 | $51.9886 | 12/2/2023 | | Reed Hastings | 16,079 | $51.8314 | 1/2/2024 | | Reed Hastings | 21,637 | $57.7686 | 2/3/2024 | | Reed Hastings | 19,635 | $63.6557 | 3/3/2024 |

  45. Outstanding Equity Awards at Fiscal Year-End

    | | Option Awards | | | | Name | Number of Securities Underlying Unexercised Options: Exercisable | Option Exercise Price ($) | Option Expiration Date | | Reed Hastings | 23,996 | $52.0986 | 4/1/2024 | | Reed Hastings | 25,998 | $48.0743 | 5/1/2024 | | Reed Hastings | 20,734 | $60.2943 | 6/2/2024 | | Reed Hastings | 18,494 | $67.5857 | 7/1/2024 | | Reed Hastings | 20,566 | $60.7714 | 8/1/2024 | | Reed Hastings | 18,361 | $68.0857 | 9/2/2024 | | Reed Hastings | 19,943 | $62.6857 | 10/1/2024 | | Reed Hastings | 22,526 | $55.4871 | 11/3/2024 | | Reed Hastings | 25,599 | $48.8300 | 12/1/2024 | | Reed Hastings | 25,074 | $49.8486 | 1/2/2025 | | Reed Hastings | 45,290 | $63.0100 | 2/2/2025 | | Reed Hastings | 41,601 | $68.6071 | 3/2/2025 | | Reed Hastings | 48,363 | $59.0171 | 4/1/2025 | | Reed Hastings | 35,868 | $79.5757 | 5/1/2025 | | Reed Hastings | 32,067 | $89.0029 | 6/1/2025 | | Reed Hastings | 30,485 | $93.6357 | 7/1/2025 | | Reed Hastings | 25,360 | $112.5600 | 8/3/2025 | | Reed Hastings | 26,977 | $105.7900 | 9/1/2025 | | Reed Hastings | 26,933 | $105.9800 | 10/1/2025 | | Reed Hastings | 26,513 | $107.6400 | 11/2/2025 | | Reed Hastings | 22,765 | $125.3700 | 12/1/2025 | | Reed Hastings | 25,959 | $109.9600 | 1/4/2026 | | Reed Hastings | 42,176 | $94.0900 | 2/1/2026 | | Reed Hastings | 40,374 | $98.3000 | 3/1/2026 | | Reed Hastings | 37,547 | $105.7000 | 4/1/2026 | | Reed Hastings | 42,629 | $93.1100 | 5/2/2026 | | Reed Hastings | 39,097 | $101.5100 | 6/1/2026 | | Reed Hastings | 41,055 | $96.6700 | 7/1/2026 | | Reed Hastings | 42,055 | $94.3700 | 8/1/2026 | | Reed Hastings | 40,755 | $97.3800 | 9/1/2026 | | Reed Hastings | 38,670 | $102.6300 | 10/3/2026 | | Reed Hastings | 32,188 | $123.3000 | 11/1/2026 | | Reed Hastings | 33,857 | $117.2200 | 12/1/2026 | | Reed Hastings | 31,130 | $127.4900 | 1/3/2027 | | Reed Hastings | 31,373 | $140.7800 | 2/1/2027 | | Reed Hastings | 30,961 | $142.6500 | 3/1/2027 | | Reed Hastings | 30,062 | $146.9200 | 4/3/2027 | | Reed Hastings | 28,431 | $155.3500 | 5/1/2027 | | Reed Hastings | 27,097 | $162.9900 | 6/1/2027 |

  46. Outstanding Equity Awards at Fiscal Year-End

    | | Option Awards | | | | Name | Number of Securities Underlying Unexercised Options: Exercisable | Option Exercise Price ($) | Option Expiration Date | | Reed Hastings | 30,216 | $146.1700 | 7/3/2027 | | Reed Hastings | 24,264 | $182.0300 | 8/1/2027 | | Reed Hastings | 25,275 | $174.7400 | 9/1/2027 | | Reed Hastings | 24,952 | $177.0100 | 10/2/2027 | | Reed Hastings | 22,306 | $198.0000 | 11/1/2027 | | Reed Hastings | 23,641 | $186.8200 | 12/1/2027 | | Neil Hunt | 3,806 | $28.5914 | 12/1/2020 | | Neil Hunt | 7,084 | $25.4871 | 1/3/2021 | | Neil Hunt | 12,327 | $30.4143 | 2/1/2021 | | Neil Hunt | 12,831 | $29.2329 | 3/1/2021 | | Neil Hunt | 10,843 | $34.5843 | 4/1/2021 | | Neil Hunt | 11,067 | $33.8843 | 5/2/2021 | | Neil Hunt | 9,821 | $38.1800 | 6/1/2021 | | Neil Hunt | 9,793 | $38.2843 | 7/1/2021 | | Neil Hunt | 9,968 | $37.6257 | 8/1/2021 | | Neil Hunt | 11,256 | $33.3243 | 9/1/2021 | | Neil Hunt | 23,177 | $16.1786 | 10/3/2021 | | Neil Hunt | 35,581 | $17.5671 | 2/1/2022 | | Neil Hunt | 38,801 | $16.1071 | 3/1/2022 | | Neil Hunt | 38,388 | $16.2814 | 4/2/2022 | | Neil Hunt | 3,931 | $13.1443 | 1/2/2023 | | Neil Hunt | 22,120 | $23.5429 | 2/1/2023 | | Neil Hunt | 19,250 | $27.0529 | 3/1/2023 | | Neil Hunt | 19,985 | $26.0614 | 4/1/2023 | | Neil Hunt | 17,122 | $30.4157 | 5/1/2023 | | Neil Hunt | 16,422 | $31.7100 | 6/3/2023 | | Neil Hunt | 16,254 | $32.0400 | 7/1/2023 | | Neil Hunt | 14,637 | $35.5886 | 8/1/2023 | | Neil Hunt | 12,614 | $41.2857 | 9/3/2023 | | Neil Hunt | 11,228 | $46.3743 | 10/1/2023 | | Neil Hunt | 11,074 | $47.0386 | 11/1/2023 | | Neil Hunt | 10,017 | $51.9886 | 12/2/2023 | | Neil Hunt | 10,052 | $51.8314 | 1/2/2024 | | Neil Hunt | 12,621 | $57.7686 | 2/3/2024 | | Neil Hunt | 11,452 | $63.6557 | 3/3/2024 | | Neil Hunt | 13,993 | $52.0986 | 4/1/2024 | | Neil Hunt | 15,169 | $48.0743 | 5/1/2024 | | Neil Hunt | 12,096 | $60.2943 | 6/2/2024 | | Neil Hunt | 10,787 | $67.5857 | 7/1/2024 |

  47. Outstanding Equity Awards at Fiscal Year-End

    | | Option Awards | | | | Name | Number of Securities Underlying Unexercised Options: Exercisable | Option Exercise Price ($) | Option Expiration Date | | Neil Hunt | 11,998 | $60.7714 | 8/1/2024 | | Neil Hunt | 10,710 | $68.0857 | 9/2/2024 | | Neil Hunt | 11,634 | $62.6857 | 10/1/2024 | | Neil Hunt | 13,139 | $55.4871 | 11/3/2024 | | Neil Hunt | 14,931 | $48.8300 | 12/1/2024 | | Neil Hunt | 14,630 | $49.8486 | 1/2/2025 | | Neil Hunt | 6,195 | $63.0100 | 2/2/2025 | | Neil Hunt | 5,691 | $68.6071 | 3/2/2025 | | Neil Hunt | 6,622 | $59.0171 | 4/1/2025 | | Neil Hunt | 4,907 | $79.5757 | 5/1/2025 | | Neil Hunt | 4,389 | $89.0029 | 6/1/2025 | | Neil Hunt | 4,172 | $93.6357 | 7/1/2025 | | Neil Hunt | 3,476 | $112.5600 | 8/3/2025 | | Neil Hunt | 3,692 | $105.7900 | 9/1/2025 | | Neil Hunt | 3,686 | $105.9800 | 10/1/2025 | | Neil Hunt | 3,629 | $107.6400 | 11/2/2025 | | Neil Hunt | 3,115 | $125.3700 | 12/1/2025 | | Neil Hunt | 3,553 | $109.9600 | 1/4/2026 | | Neil Hunt | 4,760 | $94.0900 | 2/1/2026 | | Neil Hunt | 4,557 | $98.3000 | 3/1/2026 | | Neil Hunt | 4,237 | $105.7000 | 4/1/2026 | | Neil Hunt | 4,812 | $93.1100 | 5/2/2026 | | Neil Hunt | 4,412 | $101.5100 | 6/1/2026 | | Neil Hunt | 4,634 | $96.6700 | 7/1/2026 | | Neil Hunt | 4,746 | $94.3700 | 8/1/2026 | | Neil Hunt | 4,600 | $97.3800 | 9/1/2026 | | Neil Hunt | 4,364 | $102.6300 | 10/3/2026 | | Neil Hunt | 3,633 | $123.3000 | 11/1/2026 | | Neil Hunt | 3,821 | $117.2200 | 12/1/2026 | | Neil Hunt | 3,513 | $127.4900 | 1/3/2027 | | Neil Hunt | 3,567 | $140.7800 | 2/1/2027 | | Neil Hunt | 3,519 | $142.6500 | 3/1/2027 | | Neil Hunt | 3,418 | $146.9200 | 4/3/2027 | | Neil Hunt | 3,232 | $155.3500 | 5/1/2027 | | Neil Hunt | 3,080 | $162.9900 | 6/1/2027 | | David Hyman | 4,669 | $10.7143 | 4/1/2020 | | David Hyman | 3,430 | $14.5700 | 5/3/2020 | | David Hyman | 3,262 | $15.3271 | 6/1/2020 | | David Hyman | 3,192 | $15.6657 | 7/1/2020 |

  48. Outstanding Equity Awards at Fiscal Year-End

    | | Option Awards | | | | Name | Number of Securities Underlying Unexercised Options: Exercisable | Option Exercise Price ($) | Option Expiration Date | | David Hyman | 3,437 | $14.5543 | 8/2/2020 | | David Hyman | 2,597 | $19.2729 | 9/1/2020 | | David Hyman | 2,261 | $22.0943 | 10/1/2020 | | David Hyman | 2,093 | $23.9100 | 11/1/2020 | | David Hyman | 1,750 | $28.5914 | 12/1/2020 | | David Hyman | 12,285 | $16.2814 | 4/2/2022 | | David Hyman | 5,145 | $60.7714 | 8/1/2024 | | David Hyman | 4,592 | $68.0857 | 9/2/2024 | | David Hyman | 4,984 | $62.6857 | 10/1/2024 | | David Hyman | 5,635 | $55.4871 | 11/3/2024 | | David Hyman | 6,398 | $48.8300 | 12/1/2024 | | David Hyman | 6,272 | $49.8486 | 1/2/2025 | | David Hyman | 3,962 | $63.0100 | 2/2/2025 | | David Hyman | 3,647 | $68.6071 | 3/2/2025 | | David Hyman | 4,235 | $59.0171 | 4/1/2025 | | David Hyman | 3,143 | $79.5757 | 5/1/2025 | | David Hyman | 2,807 | $89.0029 | 6/1/2025 | | David Hyman | 2,667 | $93.6357 | 7/1/2025 | | David Hyman | 2,221 | $112.5600 | 8/3/2025 | | David Hyman | 2,363 | $105.7900 | 9/1/2025 | | David Hyman | 2,359 | $105.9800 | 10/1/2025 | | David Hyman | 2,322 | $107.6400 | 11/2/2025 | | David Hyman | 1,994 | $125.3700 | 12/1/2025 | | David Hyman | 2,274 | $109.9600 | 1/4/2026 | | David Hyman | 4,439 | $94.0900 | 2/1/2026 | | David Hyman | 4,249 | $98.3000 | 3/1/2026 | | David Hyman | 3,952 | $105.7000 | 4/1/2026 | | David Hyman | 4,487 | $93.1100 | 5/2/2026 | | David Hyman | 4,115 | $101.5100 | 6/1/2026 | | David Hyman | 4,321 | $96.6700 | 7/1/2026 | | David Hyman | 4,426 | $94.3700 | 8/1/2026 | | David Hyman | 4,290 | $97.3800 | 9/1/2026 | | David Hyman | 4,070 | $102.6300 | 10/3/2026 | | David Hyman | 3,387 | $123.3000 | 11/1/2026 | | David Hyman | 3,564 | $117.2200 | 12/1/2026 | | David Hyman | 3,276 | $127.4900 | 1/3/2027 | | David Hyman | 1,798 | $140.7800 | 2/1/2027 | | David Hyman | 1,775 | $142.6500 | 3/1/2027 | | David Hyman | 1,722 | $146.9200 | 4/3/2027 |

  49. Outstanding Equity Awards at Fiscal Year-End

    | | Option Awards | | | | Name | Number of Securities Underlying Unexercised Options: Exercisable | Option Exercise Price ($) | Option Expiration Date | | David Hyman | 1,630 | $155.3500 | 5/1/2027 | | David Hyman | 1,553 | $162.9900 | 6/1/2027 | | David Hyman | 1,732 | $146.1700 | 7/3/2027 | | David Hyman | 1,390 | $182.0300 | 8/1/2027 | | David Hyman | 1,449 | $174.7400 | 9/1/2027 | | David Hyman | 1,430 | $177.0100 | 10/2/2027 | | David Hyman | 1,278 | $198.0000 | 11/1/2027 | | David Hyman | 1,355 | $186.8200 | 12/1/2027 | | Greg Peters | 8,533 | $48.8300 | 12/1/2024 | | Greg Peters | 8,358 | $49.8486 | 1/2/2025 | | Greg Peters | 9,009 | $63.0100 | 2/2/2025 | | Greg Peters | 8,274 | $68.6071 | 3/2/2025 | | Greg Peters | 9,618 | $59.0171 | 4/1/2025 | | Greg Peters | 7,133 | $79.5757 | 5/1/2025 | | Greg Peters | 6,377 | $89.0029 | 6/1/2025 | | Greg Peters | 6,062 | $93.6357 | 7/1/2025 | | Greg Peters | 5,047 | $112.5600 | 8/3/2025 | | Greg Peters | 5,366 | $105.7900 | 9/1/2025 | | Greg Peters | 5,357 | $105.9800 | 10/1/2025 | | Greg Peters | 5,274 | $107.6400 | 11/2/2025 | | Greg Peters | 4,528 | $125.3700 | 12/1/2025 | | Greg Peters | 5,163 | $109.9600 | 1/4/2026 | | Greg Peters | 7,251 | $94.0900 | 2/1/2026 | | Greg Peters | 6,941 | $98.3000 | 3/1/2026 | | Greg Peters | 6,455 | $105.7000 | 4/1/2026 | | Greg Peters | 7,329 | $93.1100 | 5/2/2026 | | Greg Peters | 6,721 | $101.5100 | 6/1/2026 | | Greg Peters | 7,058 | $96.6700 | 7/1/2026 | | Greg Peters | 7,230 | $94.3700 | 8/1/2026 | | Greg Peters | 7,007 | $97.3800 | 9/1/2026 | | Greg Peters | 6,648 | $102.6300 | 10/3/2026 | | Greg Peters | 5,533 | $123.3000 | 11/1/2026 | | Greg Peters | 5,821 | $117.2200 | 12/1/2026 | | Greg Peters | 5,352 | $127.4900 | 1/3/2027 | | Greg Peters | 4,846 | $140.7800 | 2/1/2027 | | Greg Peters | 4,783 | $142.6500 | 3/1/2027 | | Greg Peters | 4,644 | $146.9200 | 4/3/2027 | | Greg Peters | 4,392 | $155.3500 | 5/1/2027 | | Greg Peters | 4,186 | $162.9900 | 6/1/2027 |

  50. Outstanding Equity Awards at Fiscal Year-End

    | | Option Awards | | | | Name | Number of Securities Underlying Unexercised Options: Exercisable | Option Exercise Price ($) | Option Expiration Date | | Greg Peters | 4,668 | $146.1700 | 7/3/2027 | | Greg Peters | 3,891 | $182.0300 | 8/1/2027 | | Greg Peters | 4,054 | $174.7400 | 9/1/2027 | | Greg Peters | 4,001 | $177.0100 | 10/2/2027 | | Greg Peters | 3,578 | $198.0000 | 11/1/2027 | | Greg Peters | 3,791 | $186.8200 | 12/1/2027 | | Theodore Sarandos | 25,130 | $79.5757 | 5/1/2025 | | Theodore Sarandos | 22,470 | $89.0029 | 6/1/2025 | | Theodore Sarandos | 21,357 | $93.6357 | 7/1/2025 | | Theodore Sarandos | 17,773 | $112.5600 | 8/3/2025 | | Theodore Sarandos | 18,904 | $105.7900 | 9/1/2025 | | Theodore Sarandos | 18,872 | $105.9800 | 10/1/2025 | | Theodore Sarandos | 18,579 | $107.6400 | 11/2/2025 | | Theodore Sarandos | 15,952 | $125.3700 | 12/1/2025 | | Theodore Sarandos | 18,190 | $109.9600 | 1/4/2026 | | Theodore Sarandos | 26,125 | $94.0900 | 2/1/2026 | | Theodore Sarandos | 25,008 | $98.3000 | 3/1/2026 | | Theodore Sarandos | 23,258 | $105.7000 | 4/1/2026 | | Theodore Sarandos | 26,405 | $93.1100 | 5/2/2026 | | Theodore Sarandos | 24,218 | $101.5100 | 6/1/2026 | | Theodore Sarandos | 25,430 | $96.6700 | 7/1/2026 | | Theodore Sarandos | 26,050 | $94.3700 | 8/1/2026 | | Theodore Sarandos | 25,245 | $97.3800 | 9/1/2026 | | Theodore Sarandos | 23,953 | $102.6300 | 10/3/2026 | | Theodore Sarandos | 19,938 | $123.3000 | 11/1/2026 | | Theodore Sarandos | 20,972 | $117.2200 | 12/1/2026 | | Theodore Sarandos | 19,282 | $127.4900 | 1/3/2027 | | Theodore Sarandos | 16,279 | $140.7800 | 2/1/2027 | | Theodore Sarandos | 16,065 | $142.6500 | 3/1/2027 | | Theodore Sarandos | 15,598 | $146.9200 | 4/3/2027 | | Theodore Sarandos | 14,751 | $155.3500 | 5/1/2027 | | Theodore Sarandos | 14,060 | $162.9900 | 6/1/2027 | | Theodore Sarandos | 15,679 | $146.1700 | 7/3/2027 | | Theodore Sarandos | 12,589 | $182.0300 | 8/1/2027 | | Theodore Sarandos | 13,115 | $174.7400 | 9/1/2027 | | Theodore Sarandos | 12,946 | $177.0100 | 10/2/2027 | | Theodore Sarandos | 11,574 | $198.0000 | 11/1/2027 | | Theodore Sarandos | 12,267 | $186.8200 | 12/1/2027 | | David Wells | 420 | $27.0529 | 3/1/2023 |

  51. Outstanding Equity Awards at Fiscal Year-End

    | | Option Awards | | | | Name | Number of Securities Underlying Unexercised Options: Exercisable | Option Exercise Price ($) | Option Expiration Date | | David Wells | 5,278 | $26.0614 | 4/1/2023 | | David Wells | 4,522 | $30.4157 | 5/1/2023 | | David Wells | 4,333 | $31.7100 | 6/3/2023 | | David Wells | 4,291 | $32.0400 | 7/1/2023 | | David Wells | 3,864 | $35.5886 | 8/1/2023 | | David Wells | 3,332 | $41.2857 | 9/3/2023 | | David Wells | 2,968 | $46.3743 | 10/1/2023 | | David Wells | 2,926 | $47.0386 | 11/1/2023 | | David Wells | 2,646 | $51.9886 | 12/2/2023 | | David Wells | 2,653 | $51.8314 | 1/2/2024 | | David Wells | 3,969 | $57.7686 | 2/3/2024 | | David Wells | 3,598 | $63.6557 | 3/3/2024 | | David Wells | 4,396 | $52.0986 | 4/1/2024 | | David Wells | 4,767 | $48.0743 | 5/1/2024 | | David Wells | 3,801 | $60.2943 | 6/2/2024 | | David Wells | 3,388 | $67.5857 | 7/1/2024 | | David Wells | 3,773 | $60.7714 | 8/1/2024 | | David Wells | 3,367 | $68.0857 | 9/2/2024 | | David Wells | 3,654 | $62.6857 | 10/1/2024 | | David Wells | 4,130 | $55.4871 | 11/3/2024 | | David Wells | 4,690 | $48.8300 | 12/1/2024 | | David Wells | 4,599 | $49.8486 | 1/2/2025 | | David Wells | 5,537 | $63.0100 | 2/2/2025 | | David Wells | 5,082 | $68.6071 | 3/2/2025 | | David Wells | 5,915 | $59.0171 | 4/1/2025 | | David Wells | 4,382 | $79.5757 | 5/1/2025 | | David Wells | 3,920 | $89.0029 | 6/1/2025 | | David Wells | 3,731 | $93.6357 | 7/1/2025 | | David Wells | 3,101 | $112.5600 | 8/3/2025 | | David Wells | 3,298 | $105.7900 | 9/1/2025 | | David Wells | 3,293 | $105.9800 | 10/1/2025 | | David Wells | 3,241 | $107.6400 | 11/2/2025 | | David Wells | 2,784 | $125.3700 | 12/1/2025 | | David Wells | 3,173 | $109.9600 | 1/4/2026 | | David Wells | 3,986 | $94.0900 | 2/1/2026 | | David Wells | 3,814 | $98.3000 | 3/1/2026 | | David Wells | 3,548 | $105.7000 | 4/1/2026 | | David Wells | 4,028 | $93.1100 | 5/2/2026 | | David Wells | 3,694 | $101.5100 | 6/1/2026 |

  52. Outstanding Equity Awards at Fiscal Year-End

    | | Option Awards | | | | Name | Number of Securities Underlying Unexercised Options: Exercisable | Option Exercise Price ($) | Option Expiration Date | | David Wells | 3,880 | $96.6700 | 7/1/2026 | | David Wells | 3,973 | $94.3700 | 8/1/2026 | | David Wells | 3,851 | $97.3800 | 9/1/2026 | | David Wells | 3,654 | $102.6300 | 10/3/2026 | | David Wells | 3,041 | $123.3000 | 11/1/2026 | | David Wells | 3,199 | $117.2200 | 12/1/2026 | | David Wells | 2,942 | $127.4900 | 1/3/2027 | | David Wells | 2,826 | $140.7800 | 2/1/2027 | | David Wells | 2,790 | $142.6500 | 3/1/2027 | | David Wells | 2,708 | $146.9200 | 4/3/2027 | | David Wells | 2,562 | $155.3500 | 5/1/2027 | | David Wells | 2,441 | $162.9900 | 6/1/2027 | | David Wells | 2,722 | $146.1700 | 7/3/2027 | | David Wells | 2,186 | $182.0300 | 8/1/2027 | | David Wells | 2,277 | $174.7400 | 9/1/2027 | | David Wells | 2,248 | $177.0100 | 10/2/2027 | | David Wells | 2,010 | $198.0000 | 11/1/2027 | | David Wells | 2,130 | $186.8200 | 12/1/2027 |

  53. Potential Payments upon Termination or Change-in-

    Potential Payments upon Termination or Change-in-

  54. Pay Ratio Disclosure

    Pay Ratio Disclosure As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(u) of Regulation S-K the Company is providing the following information about the relationship of the annual total compensation of the Company’s employees and the annual total compensation of Mr. Hastings, the CEO. The pay ratio included in this information is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K. As disclosed in the Summary Compensation Table, the 2017 annual total compensation as determined under Item 402 of Regulation S-K for the CEO was $24,377,499. The 2017 annual total compensation as determined under Item 402 of Regulation S-K for the median employee was $183,304. Based on the foregoing, the Company’s estimate of the ratio of the CEO’s annual total compensation to the median employee’s annual total compensation for fiscal year 2017 is 133 to 1. Given the different methodologies that various public companies will use to determine an estimate of their pay ratios, the estimated ratio reported above should not be used as a basis for comparison between companies. To identify the median of the annual total compensation of all employees, as well as to determine the annual total compensation of the “median employee,” the methodology and the material assumptions, adjustments, and estimates that were used were as follows: The Company determined that, as of December 31, 2017, the global employee population consisted of 4,855 employees. The Company annualized the compensation of all full-time and part-time employees who were not employed for all of 2017. The Company selected December 31, 2017, which is within the last three months of 2017, as the date upon which the Company would identify the “median employee”. Consistent with the summary executive compensation table, the Company examined total annual compensation for all employees, which included: base salary, incentive compensation plan payments, option awards consisting of stock options, and other compensation such as 401(k) matching contributions. For employees outside the United States, the Company converted their compensation to U.S. dollars using the applicable average exchange rate for 2017.

  55. Compensation of Directors

    Compensation of Directors Since 2015, none of the Company’s directors receive cash for services they provide as directors or members of Board committees but may be reimbursed for their reasonable expenses for attending Board and Board committee meetings. Each non-employee director receives stock options pursuant to the Director Equity Compensation Plan. The Director Equity Compensation Plan provides for a monthly grant of stock options to each non-employee director of the Company in consideration for services provided to the Company and subject to the terms and conditions of the Company’s 2011 Stock Plan. The actual number of options granted each month to each of the Company’s directors is determined by the following formula: $25,000 / ([fair market value on the date of grant] x 0.40). Each monthly grant is made on the first trading day of the month, is fully vested upon grant and is exercisable at a strike price equal to the fair market value on the date of grant. The following table sets forth information concerning the compensation of the Company’s non-employee directors during 2017.

  56. Compensation of Directors

    | Names | Fees Earned or Paid in Cash ($) | Option Awards ($) | Total ($) | | Richard N. Barton | — | $335,791 (1) | 335,791 (2) | | A. George (Skip) Battle | — | 335,791 (1) | 335,791 (3) | | Timothy M. Haley | — | 335,791 (1) | 335,791 (4) | | Jay C. Hoag | — | 335,791 (1) | 335,791 (5) | | Leslie Kilgore | — | 335,791 (1) | 335,791 (6) | | Ann Mather | — | 335,791 (1) | 335,791 (7) | | Bradford L. Smith | — | 335,791 (1) | 335,791 (8) | | Anne M. Sweeney | — | 335,791 (1) | 335,791 (9) |

  57. Compensation of Directors

    | Grant Date | Fair Value | | 1/3/2017 | $28,471 | | 2/1/2017 | 28,488 | | 3/1/2017 | 28,476 | | 4/3/2017 | 27,168 | | 5/1/2017 | 27,108 | | 6/1/2017 | 27,097 | | 7/3/2017 | 27,471 | | 8/1/2017 | 27,416 | | 9/1/2017 | 27,469 | | 10/2/2017 | 28,876 | | 11/1/2017 | 28,915 | | 12/1/2017 | 28,836 |

  58. Compensation of Directors

    | Option awards reflect the monthly grant of stock options to each non-employee director on the dates and at the aggregate grant date fair values, as shown below.(1) |

  59. Compensation of Directors

    | Aggregate number of option awards outstanding held by Mr. Barton at December 31, 2017 was 64,781.(2) |

  60. Compensation of Directors

    | Aggregate number of option awards outstanding held by Mr. Battle at December 31, 2017 was 112,007.(3) |

  61. Compensation of Directors

    | Aggregate number of option awards outstanding held by Mr. Haley at December 31, 2017 was 64,702.(4) |

  62. Compensation of Directors

    | Aggregate number of option awards outstanding held by Mr. Hoag at December 31, 2017 was 57,863.(5) |

  63. Compensation of Directors

    | Aggregate number of option awards outstanding held by Ms. Kilgore at December 31, 2017 was 23,115.(6) |

  64. Compensation of Directors

    | Aggregate number of option awards outstanding held by Ms. Mather at December 31, 2017 was 35,750.(7) |

  65. Compensation of Directors

    | Aggregate number of option awards outstanding held by Mr. Smith at December 31, 2017 was 16,882.(8) |

  66. Compensation of Directors

    | Aggregate number of option awards outstanding held by Ms. Sweeney at December 31, 2017 was 16,882.(9) |

  67. Agreements with Directors and Executive Officers

    Agreements with Directors and Executive Officers The Company has entered into indemnification agreements with each of its directors and executive officers. These agreements require the Company to indemnify such individuals, to the fullest extent permitted by Delaware law, for certain liabilities to which they may become subject as a result of their affiliation with the Company.