DEF 14A of Commerce.com, Inc.
Filed Apr 3, 2024 · FY20230001193125-24-086006
Nominees for Election to the Board of Directors (Class I Directors)
Nominees for Election to the Board of Directors (Class I Directors) Brent Bellm has served as our president, chief executive officer, and the chairman of our Board of Directors since June 2015. He stepped down from being president in August 2023. Prior to joining our company as our chief executive officer, Mr. Bellm was the president and chief operating officer of HomeAway Inc., a vacation rental online marketplace, from July 2010 to June 2015. Previously, Mr. Bellm served in various capacities at PayPal Holdings, Inc. from December 2002 to July 2010, most recently as vice president of global product, and at eBay, Inc. as director of corporate strategy from April 2001 to December 2002. Mr. Bellm worked with McKinsey & Company from September 1993 to January 2000. Mr. Bellm holds a B.A. in International Relations and Economics from Stanford University and an M.B.A. from Harvard Business School. We believe Mr. Bellm is qualified to serve as a member of our Board of Directors due to his perspective as our chief executive officer. Lawrence Bohn has been a member of our Board of Directors since July 2011. Mr. Bohn has served as a managing director of General Catalyst Partners, a venture capital firm, since April 2003. Prior to joining General Catalyst, Mr. Bohn served as the president, chief executive officer and chairman of the board of directors of NetGenesis Corp. and president of PC Docs, Inc. Mr. Bohn served on the boards of directors of HubSpot, Inc. and Demandware, Inc. from 2007 until October 2017 and 2004 until January 2016, respectively. He also currently serves on the board of directors of several privately-held companies. Mr. Bohn holds a B.A. in English from the University of Massachusetts, Amherst, and an M.A. in Linguistics from Clark University. We believe Mr. Bohn is qualified to serve as a member of our Board of Directors because of his executive leadership experience and extensive experience in the fields of cloud computing and SaaS. Jeff Richards has been a member of our Board of Directors since May 2016. Mr. Richards has served as a managing partner at GGV Capital, a California-based venture capital firm, since 2010, after joining the firm in 2008. Prior to joining GGV Capital, Mr. Richards founded two technology companies: R4 Global Solutions, Inc., which was acquired by Verisign, Inc. in 2005, and QuantumShift Communications, Inc. Mr. Richards served as vice president of digital content services at Verisign, Inc. from May 2005 to May 2008. Previously, Mr. Richards was a management consultant with PricewaterhouseCoopers LLP from April 1995 to October 1997. He currently sits on the boards of directors of multiple private software and technology companies. Mr. Richards holds a B.A. in Government from Dartmouth College. We believe Mr. Richards is qualified to serve as a member of our Board of Directors due to his extensive experience with global technology companies.
Class II Directors
Class II Directors Sally Gilligan has been a member of our Board of Directors since July 2022. Ms. Gilligan has served as Chief Supply Chain & Transformation Officer for Gap Inc. since March 2023 and previously served in a variety of other roles for Gap Inc., including Chief Growth Transformation Officer, Head of Strategy, Chief Information Officer, and SVP of Product Operations and Supply Chain Strategy, since joining the company in 2004. Prior to joining Gap Inc., Ms. Gilligan worked for over ten years in management consulting and financial services, including Boston Consulting Group and Andersen. Ms. Gilligan holds a B.S. in Business Administration from Georgetown University and an M.B.A from the University of Chicago. She has served as Chair of the Gap Foundation since 2021 and serves on the board of the American Apparel and Footwear Association. We believe Ms. Gilligan is qualified to serve as a member of our Board of Directors due to her digital growth and transformation experience. Satish Malhotra has been a member of our Board of Directors since July 2022. Mr. Malhotra has served as president and chief executive officer of The Container Store Group, Inc. since February 2021. For the previous 21 years, Mr. Malhotra held various leadership roles at prestige beauty retailer Sephora Americas, most recently as chief retail officer and chief operating officer from 2019 until his departure. Prior to that role, Mr. Malhotra served as chief operating officer from 2016 to 2019 and was responsible for technology, supply chain, store development, legal, strategy and partnerships, including the Sephora inside JCPenney business. He also spent several years overseeing Sephora’s expansion into Canada and Latin America. Before joining Sephora, Mr. Malhotra was a transaction services senior associate at PricewaterhouseCoopers. Mr. Malhotra received his B.S. in Business Administration from the Haas School of Business at the University of California, Berkeley. Mr. Malhotra also holds an inactive Certified Public Accountant’s license from the State of California. We believe Mr. Malhotra is qualified to serve as a member of our Board of Directors due to his executive leadership, operations and consumer retail experience.
Class III Directors
Class III Directors Donald E. Clarke has been a member of our Board of Directors since December 2016. From January 2014 through December 2021, Mr. Clarke served as the chief financial officer for Plex Systems, Inc., a cloud technology company, and also held the position of its interim chief executive officer from October 2017 through November 2018. Previously, he served as the chief financial officer for multiple software and technology companies including two companies he took public and one existing publicly traded company. Mr. Clarke is a member of the board of directors of Alarm.com Holdings, Inc. and Slice Solutions, Inc. He is a member of the American Institute of Certified Public Accountants and holds a B.S. in Accounting from Virginia Polytechnic Institute and State University. We believe Mr. Clarke is qualified to serve as a member of our Board of Directors because of his experience in operations, strategy, accounting, risk oversight and financial management at both publicly and privately held companies. Ellen F. Siminoff has been a member of our Board of Directors since February 2020. Ms. Siminoff joined the board of Take-Two Interactive, Inc., a leading game developer, in May 2022, following Take-Two’s combination with Zynga, where she served since June 2012. She also serves on the board of Follett Corporation, a partner of K-12 schools and districts, since August 2022, and Verifone, the pre-eminent global payments platform, since March 2021. Ms. Siminoff also serves on the President’s Advisory Committee at Princeton University and on the Board of Overseers of the Hoover Institution at Stanford University. Ms. Siminoff’s previous board experience includes Shmoop University, Inc., an educational publishing company, SolarWinds Inc., a provider of downloadable, enterprise-class network management software, Discovery Education, Inc., an educational curriculum provider, and Mozilla Corporation, the makers of Firefox browsers. She also served as a founding executive at Yahoo! from February 1996 to February 2002. Ms. Siminoff holds an A.B. degree in Economics from Princeton University and an M.B.A. from the Stanford Graduate School of Business. We believe Ms. Siminoff is qualified to serve as a member of our Board of Directors because of her experience as a long-tenured media and technology executive and board member.
Compensation committee
| · | reviewing and recommending the compensation of our directors; |
Director Compensation
Director Compensation The information contained in “Executive Compensation—Director Compensation” is incorporated herein by reference.
Executive Summary
In order to align pay with performance, a significant portion of our NEOs’ compensation is delivered in the form of equity awards and annual cash incentives, each of which depends on our actual performance. For fiscal year 2023, approximately 73% of our NEOs’ total target compensation was in the form of stock options and restricted stock units (“RSUs”), which will vest based on continued service. 2023 Compensation Highlights. Consistent with our compensation philosophy, key compensation decisions for 2023 included the following:
Executive Summary
| · | Base Salaries and Target Annual Cash Incentive Opportunities. The 2023 base salaries and target bonuses for our NEOs were increased to position base salaries between the 25th and 50th percentile of market and target bonuses were set between the 25th and 50th percentile of market, based on the market analysis of our independent compensation consultant, as described further below. |
Executive Summary
| · | Annual Cash Incentives. For 2023, the compensation committee of our Board of Directors (the “Compensation Committee”) selected performance goals for our performance-based annual bonus program that were intended to promote our business plan and short-term goals, including with respect to revenue growth, subscription ARR and adjusted EBITDA. |
Executive Summary
| · | Equity-Based Long Term Incentives. In 2023, we granted approximately 73% of our NEOs’ target direct compensation as equity-based compensation in the form of stock options and RSUs. We believe that stock options and RSUs effectively align the interests of our executives with those of our stockholders by directly linking compensation to the value of our common stock. In 2023, we granted 30% of our NEOs’ long-term equity awards in the form of stock options and 70% in the form of RSUs. |
Executive Summary
| What We Do | | What We Do Not Do | | ✓ | Emphasize performance-based, at riskX | Do not grant uncapped cash incentives or | | | compensation in the form of long-term and short- | guaranteed equity compensation. | | | term incentives.X | Do not provide significant perquisites. | | ✓ | Emphasize the use of equity compensation toX | Do not provide any compensation-related tax gross-ups. | | | promote executive retention and reward long-termX | Do not provide defined benefit pension plans. | | | value creation.X | Do not provide supplemental executive retirement | | ✓ | Weight the overall pay mix towards long term | plans. | | | incentive compensation for senior executives.X | No hedging or pledging of stock. | | ✓ | Engage an independent compensation consultant to advise our Compensation Committee.X | No dividends paid on unvested equity. |
Executive Compensation Objectives and Philosophy
| · | Provide reward opportunities consistent with our performance on both a short-term and long-term basis; and |
Executive Compensation Objectives and Philosophy
| · | Align the long-term interests of our NEOs with those of our stockholders. |
Role of Compensation Consultant
Role of Compensation Consultant The Compensation Committee has retained Aon-Radford (“Radford”) as an independent compensation consultant to provide executive compensation advisory services, help evaluate our compensation philosophy and objectives, design a competitive executive compensation program that will continue to attract top executive talent and reflect our compensation philosophy, and provide guidance in administering our executive compensation program. In addition, Radford’s affiliates (Aon plc and its related entities) performed insurance advisory and insurance brokerage services for us during 2023, for which we paid approximately $323,000. Insurance premiums and related fees were paid to Aon plc and passed through to third-party insurance companies not affiliated with Aon plc. Our Compensation Committee reviewed these services and fees and considered the independence of Radford in light of SEC rules regarding conflicts of interest involving compensation consultants and applicable Nasdaq listing standards regarding compensation consultant independence. Based on its review, our Compensation Committee determined that Radford was independent, and that Radford’s services did not raise any conflicts of interest. In consultation with Radford, in November 2022, our Compensation Committee selected our peer group as follows, focusing primarily on domestic, publicly-traded SaaS and e-commerce companies with annual revenue between $140 million and $840 million and market capitalization between $400 million and $3.5 billion. As of October 2022, as compared to such peer groups, we were at the 10th percentile for net income for the preceding 12 months, the 28th percentile for operating income for the preceding 12 months, and the 18th percentile for 30-day average market cap. Our peer group for 2023 included the following companies:
Role of Compensation Consultant
| ● AppFolio | ● Appian | ● Blackline | ● CSDisco | | ● Digital Turbine | ● E2Open Parent | ● Everbridge | ● EverCommerce | | ● Fastly | ● Intapp | ● Jamf | ● JFrog | | ● Momentive Global | ● nCino | ● Olo | ● Q2 Holdings | | ● Sprout Social | ● SPS Commerce | ● Sumo Logic | ● Workiva | | ● Zuora | | | |
Role of Compensation Consultant
The peer group selected for 2023 reflected the following changes from our 2022 peer group:
Role of Compensation Consultant
| Entities Removed From Peer Group | Entities Added to Peer Group | | Five9 | Digital Turbine | | Ping Identity | Intapp | | Sailpoint Technologies | Olo | | Upland Software | Sumo Logic | | | Zuora |
Role of Compensation Consultant
In determining what changes to make to our peer group described above, the Compensation Committee removed the four companies identified above because they were acquired or had market values that were outliers. The companies identified above that were added to our peer group were added to balance out those companies that were removed and met most or all of the selection criteria. Changes were made to the peer group selection criteria for range multiples for revenue and market capitalization ranges. In December 2022, Radford provided an analysis of data derived from members of our peer group and the Radford Global Compensation Database survey, the constituent companies of which were not provided to the Compensation Committee. For 2023, the Compensation Committee used Radford’s analysis to help structure a competitive executive compensation program, position executive compensation by considering market data, and make individual compensation decisions based on comparable positions at companies with which we compete for talent. Although the Compensation Committee does not establish compensation levels solely based on a review of competitive data or benchmark to any particular level, it believes such data is a useful tool in its deliberations as our compensation policies and practices must be competitive in the marketplace for us to be able to attract, motivate, and retain qualified executive officers. Our Compensation Committee and Chief Executive Officer, as applicable, used benchmark data as a foundational starting point to determine target compensation for each NEO, and then adjusted the targets based on the NEO’s role criticality and incumbent performance. The benchmark data utilized was from our approved peer group based on relevant sector, revenue, market capitalization, and location, and was ultimately approved by the Compensation Committee.
Cash Incentive Compensation
Cash Incentive Compensation Annual cash incentive bonuses are an important component of our total compensation program and provide cash incentives that we believe are necessary to retain executive officers. During 2023 each NEO was eligible to receive an annual performance-based cash bonus under our 2023 Executive Bonus Plan based on a specified target annual bonus amount, expressed as a percentage of the named NEO’s base salary. We aim to award annual cash incentive bonuses that are between the 25th and 50th percentiles of market. Accordingly, following our review of the target bonus levels for each of our NEOs in March 2023, we determined that, for fiscal year 2023, our NEOs’ target annual bonuses would not be adjusted from their 2022 levels. Subsequently, we determined to increase Mr. Lentz’s bonus target from 35% to 55% in connection with his promotion to Chief Financial Officer in June 2023. Our NEOs’ target annual bonuses for 2023 were equal to the following percentages of base salary:
Cash Incentive Compensation
| Named Executive Officer | Target Percentage | | Brent Bellm | 100% | | Daniel Lentz | 45%(1) | | Robert Alvarez | 65% | | Russell Klein | 60% | | Brian Dhatt | 50% |
Cash Incentive Compensation
| Named Executive Officer | Target Percentage | | Steven Chung | 80% | | Marc Ostryniec | 50% |
Cash Incentive Compensation
| (1) The target percentage reflects the increase in Mr. Lentz’s target annual bonus percentage from 35% to 55% effective June 30, 2023. |
Cash Incentive Compensation
At the beginning of 2023, the Board, considering the recommendations of the Compensation Committee and management, set the performance goals applicable to our 2023 annual bonus program. The performance goals established by the Board for our 2023 annual bonus program, and their respective weightings, were as follows:
Cash Incentive Compensation
| Performance Metrics | Revenue Growth Rate | Subscription Annual Revenue Run-Rate Growth Rate | Adjusted EBITDA | | Weighting | 33.33% | 33.33% | 33.33% | | Target | 13.9% | 14.3% | ($13.2) million |
Cash Incentive Compensation
For the year ended December 31, 2023, the Company attained a revenue growth rate of 11.0% resulting in achievement of the revenue growth rate performance goal at 77.7% of target, a subscription annual revenue run-rate growth rate of 8.0% resulting in achievement of the subscription annual revenue run-rate growth rate performance goal at 50.9% of target and an adjusted EBITDA loss of ($1.6) million versus a target of ($13.2) million resulting in achievement of the adjusted EBITDA performance goal at 219% of target. Based on the foregoing, the aggregate achievement of performance goals under the 2023 Executive Bonus Plan was approximately 88% of target, after giving effect to the Company’s financial performance thresholds described in the approved plan. The amounts of such bonuses paid to our NEOs in respect of 2023 are set forth in the column titled “Non-Equity Incentive Plan Compensation” in the 2023 Summary Compensation Table below. Mr. Alvarez did not receive a 2023 annual bonus because his employment with us ended on June 30, 2023. Mr. Chung did not receive a 2023 annual bonus because his employment with us ended on February 16, 2024, prior to the payment of 2023 cash bonuses.
Equity-Based Long-Term Incentive Awards
Equity-Based Long-Term Incentive Awards We view equity-based compensation as a critical component of our balanced total compensation program and aim to grant equity awards with target values between the 50(h) and 75th percentile of market. Equity-based compensation creates an ownership culture among our executives that provides an incentive to contribute to the continued growth and development of our business and aligns the interest of executives with those of our stockholders, reinforcing our commitment to ensuring a strong linkage between company performance and pay. In 2023, we granted 70% of our target equity award value in the form of RSUs and 30% in the form of options to purchase our common stock.
2023 Equity-Based Long-Term Incentive Awards
2023 Equity-Based Long-Term Incentive Awards In 2023, we made the following grants of stock options and RSUs to our NEOs:
2023 Equity-Based Long-Term Incentive Awards
| Name | Number of Shares Underlying Stock Options | Number of RSUs | | Brent Bellm | 163,637 | 254,546 | | Daniel Lentz | 62,728 | 97,576 | | Robert Alvarez (1) | — | — | | Russell Klein | 81,819 | 127,273 | | Brian Dhatt | 43,637 | 67,879 | | Steven Chung (2) | 175,263 | 272,632 | | Marc Ostryniec (3) | 68,182 | 106,061 |
2023 Equity-Based Long-Term Incentive Awards
| (1) Mr. Alvarez was not granted any equity incentive awards in 2023 in anticipation of his retirement. All unvested stock options and RSUs granted to Mr. Alvarez were forfeited upon his resignation, effective June 30, 2023. |
2023 Equity-Based Long-Term Incentive Awards
| (2) All unvested stock options and RSUs granted to Mr. Chung were forfeited upon his resignation, effective February 16, 2024. |
2023 Equity-Based Long-Term Incentive Awards
| (3) All unvested stock options and RSUs granted to Mr. Ostryniec were forfeited upon his departure, effective November 30, 2023. |
2023 Equity-Based Long-Term Incentive Awards
These grants (other than the grants for Mr. Chung and certain promotion grants for Mr. Lentz) were approved by the Compensation Committee in March 2023, following consideration of the factors set forth above under “—Determination of Executive Compensation.” Mr. Lentz’s awards include both his annual grants and additional awards of 21,818 stock options and 33,939 RSUs in June 2023 in connection with his promotion to Chief Financial Officer. Mr. Chung received his awards in connection with the commencement of his employment with us in August 2023. The stock options granted to our NEOs during 2023 vest as to 25% of the underlying shares on the first anniversary of the applicable vesting start date and as to the balance of the underlying shares in 36 substantially equal monthly installments thereafter, subject to the applicable NEO’s continued service through the applicable vesting date. The RSU awards granted to our NEOs during 2023 vest as to 25% of the underlying shares on each of the first four anniversaries of the applicable vesting start date, subject to the applicable NEO’s continued service through the applicable vesting date. Certain of our NEOs’ stock options and RSUs are subject to accelerated vesting in certain circumstances, as described below under “—Potential Payments Upon Termination or Change in Control”.
2024 Long-Term Incentive Awards
2024 Long-Term Incentive Awards In March 2024, the Compensation Committee approved a change in the structure of our long-term incentive compensation program for our senior officers (including our currently-employed NEOs). The annual equity awards granted in 2024 to each NEO currently employed by us consisted of, and, going forward, the Compensation Committee intends to continue to grant our senior officers annual equity awards consisting of stock options, time-vesting RSUs and performance-based RSUs. We believe that including performance-based RSUs in our long-term incentive compensation program further aligns our NEOs’ interests with those of our stockholders and the performance of our Company, while encouraging our NEOs to contribute to the attainment of the relevant performance goals and increase total shareholder return (as further discussed below). The time-vesting stock options granted to our NEOs during 2024 represented 30% of the total target annual award value, and vest as to 25% of the underlying shares on the first anniversary of the applicable vesting date and as to the balance of the underlying shares in 36 substantially equal monthly installments thereafter, subject to the applicable NEO’s continued service through the applicable vesting date. The time-vesting RSU awards granted to our NEOs during 2024 represented 20% of the total target annual award value, and vest as to 25% of the underlying shares on each of the first four anniversaries of the applicable vesting start date, subject to the applicable NEO’s continued service through the applicable vesting date. The performance-based RSUs represented 50% of the total target annual award value, and consist of (i) performance-based RSUs subject to vesting based on the Company’s adjusted earnings before interest, taxes, depreciation and amortization (the “adjusted EBITDA RSUs”), (ii) performance-based RSUs subject to vesting based on the Company’s revenue (the “revenue RSUs”), and (iii) performance-based RSUs subject to vesting based on the Company’s total stockholder return (the “TSR RSUs”) compared to the Russell 2000 index. Each of the adjusted EBITDA RSUs, the revenue PSUs and the TSR PSUs represented one-third of the total number of total performance-based RSUs awarded to the NEOs. Pursuant to the performance-based RSU awards, the NEOs will be eligible to vest in a number of RSUs ranging from 0% to 200% of the target number of performance-based RSUs granted, based on attainment of the applicable performance goals during a three-year performance period commencing January 1, 2024 and ending December 31, 2026 (with adjusted EBITDA RSUs and revenue RSUs vesting in three annual tranches and the TSR RSUs cliff-vesting at the end of the three-year performance period).
Severance and Change in Control Arrangements
Severance and Change in Control Arrangements We provide for severance benefits and payments to each of our NEOs upon certain terminations without cause or resignations for good reason. Our Compensation Committee believes that these types of benefits are necessary to attract and retain executive talent and are a customary component of executive compensation. In particular, such benefits can mitigate a potential disincentive for our NEOs when they are evaluating a potential acquisition of the Company and can encourage retention through the conclusion of the transaction. Our severance and change in control payments and benefits are designed to be competitive with market practices. A description of these potential benefits, as well as information on the estimated payments and benefits that our NEOs would have been eligible to receive if a qualifying termination of employment or change in control had occurred on December 31, 2023, are set forth in “—Potential Payments Upon Termination or Change in Control” below. On November 30, 2023, we entered into a separation and general release (the “separation agreement”) with Mr. Ostryniec in connection with his termination of employment with us. Under the separation agreement, Mr. Ostryniec is entitled to certain severance payments and benefits, subject to his execution and non-revocation of the separation agreement, including the general release contained therein, and compliance with the terms thereof. A description of these severance payments and benefits are set forth in “—Potential Payments Upon Termination or Change in Control” below. Other Policies and Considerations Stock Ownership Guidelines. We believe that stock ownership aligns the interests of our executive officers with our stockholders and encourages long-term management of the Company for the benefit of its stockholders. We maintain stock ownership guidelines which apply to our senior leadership team. Under these guidelines, our senior leaders are required to acquire and maintain shares of our common stock having a value equal to the following multiples of their annual base salaries following the completion of a five-year phase-in period:
Severance and Change in Control Arrangements
| Position | Required Stock Ownership | | Chief Executive Officer | 3x annual base salary | | All Other Senior Officers | 1x annual base salary |
Severance and Change in Control Arrangements
Derivatives Trading, Hedging, and Pledging Policies. Our Insider Trading Compliance Policy provides that no employee, officer, or director may engage in any activity of the type that is designed to profit from or hedge against decreases in the value of the Company’s securities, such as short sales, trading activity designed to profit from fluctuations in the price of the Company’s securities (such as day trading and arbitrage trading), hedging transactions, and trading in puts, calls or other derivative securities. In addition, our Insider Trading Compliance Policy provides that no employee, officer, or director may pledge Company securities as collateral to secure loans. This prohibition means, among other things, that these individuals may not hold Company securities in a “margin” account, which would allow the individual to borrow against their holdings to buy securities. Clawback Policy. We maintain a mandatory clawback policy in compliance with SEC rules and Nasdaq listing standards (the “Clawback Policy”). Our Clawback Policy provides that the Company shall recover from current or former executive officers excess incentive-based compensation (i.e., incentive compensation that is granted, earned or vested based in whole or in part on the attainment of one or more financial reporting measures) in the event the Company is required to prepare an accounting restatement, unless the Compensation Committee determines that recovery would be impracticable. Section 409A. The Compensation Committee takes into account whether components of the compensation for our executive officers will be adversely impacted by the penalty tax imposed by Section 409A of the Code, and aims to structure these components to be compliant with or exempt from Section 409A to avoid such potential adverse tax consequences. Section 162(m). Section 162(m) of the Code disallows a tax deduction to public companies for compensation in excess of $1 million paid to “covered employees”, which generally includes all NEOs. While the Compensation Committee may take the deductibility of compensation into account when making compensation decisions, the Compensation Committee will award compensation that it determines to be consistent with the goals of our executive compensation program even if such compensation is not deductible by us. “Golden Parachute” Payments. Sections 280G and 4999 of the Code provide that certain executive officers and other service providers who are highly compensated or hold significant equity interests may be subject to an excise tax if they receive payments or benefits in connection with a change in control of the Company that exceeds certain prescribed limits, and that we, or a successor, may forfeit a tax deduction on the amounts subject to this additional tax. While the Compensation Committee may take the potential forfeiture of such tax deduction into account when making compensation decisions, it will award compensation that it determines to be consistent with the goals of our executive compensation program even if such compensation is not deductible by us. We do not provide any tax gross-ups to cover excise taxes under Section 4999 in connection with a change in control. Accounting for Share-Based Compensation. We follow Financial Accounting Standard Board Accounting Standards Codification Topic 718, (“ASC Topic 718”), for our share-based compensation awards. ASC Topic 718 requires companies to measure the compensation expense for all share-based payment awards made to employees and directors, including stock options and RSUs, based on the grant date “fair value” of these awards. This calculation is performed for accounting purposes and reported in the compensation tables below, even though our NEOs may never realize any value from their awards.
2023 Summary Compensation Table
2023 Summary Compensation Table The following table contains information about the compensation earned by each of our NEOs during the fiscal years ended December 31, 2023, 2022 and 2021.
2023 Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($)(1) | Option Awards ($)(1) | Non-Equity Incentive Plan Compensation ($)(2) | All Other Compensation ($)(3) | Total | | Brent Bellm | 2023 | 486,538 | — | 2,652,369 | 1,091,288 | 428,668 | — | 4,658,863 | | Chief Executive Officer | 2022 | 469,231 | 206,860 | 4,531,970 | 2,062,057 | — | — | 7,270,118 | | | 2021 | 450,000 | — | 4,356,397 | 1,969,207 | 612,000 | — | 7,387,604 | | Daniel Lentz | 2023 | 355,865 | — | 1,000,791 | 409,911 | 143,678 | — | 1,910,245 | | Chief Financial Officer | | | | | | | | | | Robert Alvarez | 2023 | 236,106 | — | — | — | — | — | 236,106 | | Former Chief Financial Officer | 2022 | 390,385 | 111,857 | 1,510,650 | 687,345 | — | — | 2,700,237 | | | 2021 | 375,000 | | 1,766,073 | 798,312 | 331,500 | — | 3,270,885 | | Russell Klein | 2023 | 394,231 | — | 1,326,185 | 545,647 | 208,668 | — | 2,474,731 | | Chief Commercial Officer | 2022 | 365,769 | 96,946 | 1,510,650 | 687,345 | — | — | 2,660,710 | | | 2021 | 335,000 | — | 1,766,073 | 798,312 | 273,360 | — | 3,172,745 | | Brian Dhatt | 2023 | 394,231 | — | 707,299 | 291,013 | 173,890 | — | 1,566,433 | | Chief Technology Officer | 2022 | 365,769 | 80,788 | 1,498,055 | 681,627 | — | — | 2,626,239 | | | 2021 | 335,000 | — | 1,059,632 | 478,937 | 227,800 | — | 2,101,369 | | Steven Chung | 2023 | 159,231 | — | 2,824,468 | 1,147,535 | — | — | 4,131,234 | | Former President | | | | | | | | | | Marc Ostryniec | 2023 | 282,154 | 238,203 | 1,105,156 | 454,703 | — | 198,560(3) | 2,278,776 | | Former Chief Sales Officer | | | | | | | | |
2023 Summary Compensation Table
| (1) Amounts reflect the full grant-date fair value of RSU awards and stock options granted during fiscal year 2023 computed in accordance with ASC Topic 718, rather than the amounts paid to or realized by the NEO. We provide information regarding the assumptions used to calculate the value of all RSU awards and stock option awards made to our NEOs in Note 11 to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. The stock options and RSUs granted to Mr. Chung and Mr. Ostryniec were forfeited on February 16, 2024 and November 30, 2023, respectively the date on which their employment with us ended. |
2023 Summary Compensation Table
| (2) Amounts for fiscal year 2023 represent amounts earned by our NEOs based upon the achievement of certain Company performance goals that were attained under our annual bonus program for fiscal year 2023. For more information, please see “—Cash Incentive Compensation” above. Messrs. Alvarez and Chung were not eligible to receive an annual bonus for 2023 following their respective resignations. Mr. Ostryniec received a pro-rated annual bonus pursuant to the terms of his separation agreement (the amount of which is reported in the “All Other Compensation” column). |
2023 Summary Compensation Table
| (3) Amounts for fiscal year 2023 represent cash severance in the amount of $198,560 payable to Mr. Ostryniec pursuant to his separation agreement. |
Grants of Plan-Based Awards in Fiscal 2023
Grants of Plan-Based Awards in Fiscal 2023 The following table provides information regarding all grants of plan-based awards occurring during fiscal 2023. All stock options and RSUs were awarded under the BigCommerce Holdings, Inc. 2020 Equity Incentive Plan (the “2020 Plan”).
Grants of Plan-Based Awards in Fiscal 2023
| Name | Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | | | All Other Stock Awards: Number of Shares of Stock or Units (#)(2) | All Other Option Awards: Number of Securities Underlying Options (#)(3) | Exercise or Base Price of Option Awards ($/Sh) | Grant Date Fair Value of Stock and Option Awards ($)(4) | | | | Threshold ($) | Target ($) | Maximum ($) | | | | | | Brent Bellm | 01/01/2023 | 0 | 487,123 | 1,055,353 | | | | | | | 03/03/2023 | | | | 254,546 | | | 2,652,369 | | | 03/03/2023 | | | | | 163,637 | 10.42 | 1,091,288 | | Daniel Lentz | 01/01/2023 | 0 | 163,271 | 353,726 | | | | | | | 03/03/2023 | | | | 63,637 | | | 663,098 | | | 03/03/2023 | | | | | 40,910 | 10.42 | 272,827 | | | 06/30/2023 | | | | 33,939 | | | 337,693 | | | 06/30/2023 | | | | | 21,818 | 9.95 | 137,084 | | Robert Alvarez | 01/01/2023 | 0 | 259,377 | 561,940 | - | - | - | - | | Russell Klein | 01/01/2023 | 0 | 237,123 | 513,728 | | | | | | | 03/03/2023 | | | | 127,273 | | | 1,326,185 | | | 03/03/2023 | | | | | 81,819 | 10.42 | 545,647 | | Brian Dhatt | 01/01/2023 | 0 | 197,603 | 428,106 | | | | | | | 03/03/2023 | | | | 67,879 | | | 707,299 | | | 03/03/2023 | | | | | 43,637 | 10.42 | 145,510 | | Steven Chung | 01/01/2023 | 0 | 141,151 | 305,803 | | | | | | | 08/28/2023 | | | | 272,632 | | | 2,824,468 | | | 08/28/2023 | | | | | 175,263 | 10.36 | 1,147,535 | | Marc Ostryniec | 01/01/2023 | 0 | 296,164 | 641,640 | | | | | | | 03/03/2023 | | | | 106,061 | | | 1,105,156 | | | 03/03/2023 | | | | | 68,182 | 10.42 | 454,703 |
Grants of Plan-Based Awards in Fiscal 2023
| (1) Amounts reflect potential payouts under our 2023 annual bonus program. Please see the description of the annual bonus program under “—Cash Incentive Compensation” above. |
Grants of Plan-Based Awards in Fiscal 2023
| (2) Represents RSUs which vest as to 25% of the underlying shares on each of the first four anniversaries of the applicable vesting start date, subject to the applicable NEOs continued service with the Company through the applicable vesting date. |
Grants of Plan-Based Awards in Fiscal 2023
| (3) Represents stock options which vest over four years, with 25% of the shares vesting on the one-year anniversary of the applicable vesting start date, and as to the balance of the underlying shares, in 36 substantially equal monthly installments thereafter, subject to the applicable NEOs continued service with the Company through the applicable vesting date. |
Grants of Plan-Based Awards in Fiscal 2023
| (4) Amounts reflect the grant-date fair value of the applicable award computed in accordance with ASC Topic 718. We provide information regarding the assumptions used to calculate these values in Note 11 to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. |
NARRATIVE TO SUMMARY COMPENSATION TABLE AND GRANTS OF PLAN-BASED AWARDS TABLE
NARRATIVE TO SUMMARY COMPENSATION TABLE AND GRANTS OF PLAN-BASED AWARDS TABLE
Outstanding Equity Awards at Fiscal Year-End Table
Outstanding Equity Awards at Fiscal Year-End Table The following table summarizes the number of shares of common stock underlying outstanding equity incentive plan awards for each NEO as of December 31, 2023.
Outstanding Equity Awards at Fiscal Year-End Table
| | Option Awards | | | | Stock Awards | | | Name | Number of Securities Underlying Unexercised Options (#) Exercisable(1) | Number of Securities Underlying Unexercised Options (#) Unexercisable(2) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($)(3) | | Brent Bellm | 900,000 | — | 3.03 | 11/30/2028 | | | | | 43,102 | 19,592(4) | 59.56 | 3/13/2031 | | | | | 83,295 | 107,903(5) | 20.25 | 3/8/2032 | | | | | — | 163,637(6) | 10.42 | 3/3/2033 | | | | | | | | | 77,030(8) | 749,502 | | | | | | | 36,571(9) | 355,836 | | | | | | | 167,851(10) | 1,633,190 | | | | | | | 254,546(11) | 2,476,732 | | Daniel Lentz | 31,184 | — | 3.18 | 2/27/2029 | | | | | 3,494 | 1,588(4) | 59.56 | 3/13/2031 | | | | | 10,607 | 13,637(5) | 20.25 | 3/8/2032 | | | | | — | 40,910(6) | 10.42 | 3/3/2033 | | | | | — | 21,818(7) | 9.95 | 6/30/2033 | | | | | | | | | 8,700(8) | 84,651 | | | | | | | 2,965(9) | 28,849 | | | | | | | 21,214(10) | 206,412 | | | | | | | 63,637(11) | 619,188 | | | | | | | 33,939(12) | 330,226 | | Robert Alvarez | — | — | — | — | — | — | | Russell Klein | 98,080 | — | 0.39 | 11/12/2025 | | | | | 115,901 | — | 0.39 | 11/7/2026 | | | | | 42,693 | — | 1.86 | 12/31/2027 | | | | | 130,000 | — | 3.03 | 11/30/2028 | | | | | 17,474 | 7,942(4) | 59.56 | 3/13/2031 | | | | | 27,975 | 35,967(5) | 20.25 | 3/8/2032 | | |
Outstanding Equity Awards at Fiscal Year-End Table
| | Option Awards | | | | Stock Awards | | | Name | Number of Securities Underlying Unexercised Options (#) Exercisable(1) | Number of Securities Underlying Unexercised Options (#) Unexercisable(2) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($)(3) | | | — | 81,819(6) | 10.42 | 3/3/2033 | | | | | | | | | 25,676(8) | 249,827 | | | | | | | 14,826(9) | 144,257 | | | | | | | 55,950(10) | 544,394 | | | | | | | 127,273(11) | 1,238,366 | | Brian Dhatt | 218,747 | — | 0.39 | 11/7/2026 | | | | | 48,504 | — | 1.86 | 2/27/2028 | | | | | 9,929 | — | 3.03 | 11/30/2028 | | | | | 29,512 | — | 3.18 | 2/27/2029 | | | | | 10,483 | 4,765(4) | 59.56 | 3/13/2031 | | | | | 27,742 | 35,668(5) | 20.25 | 3/8/2032 | | | | | — | 43,637(6) | 10.42 | 3/3/2033 | | | | | | | | | 15,406(8) | 149,900 | | | | | | | 8,895(9) | 86,548 | | | | | | | 55,483(10) | 539,850 | | | | | | | 67,879(11) | 660,463 | | Steven Chung | — | 175,263(13) | 10.36 | 8/28/2033 | | | | | | | | | 272,632(14) | 2,652,709 | | Marc Ostryniec | 155,896 | — | 3.03 | 12/31/2028 | | | | | 9,036 | 4,518(4) | 59.56 | 3/13/2031 | | | | | 17,096 | 23,934(5) | 20.25 | 3/8/2032 | | | | | — | 68,182(6) | 10.42 | 3/3/2033 | | | | | | | | | 14,114(8) | 137,329 | | | | | | | 7,907(9) | 76,935 | | | | | | | 35,901(10) | 349,317 | | | | | | | 106,061(11) | 1,031,974 |
Outstanding Equity Awards at Fiscal Year-End Table
| (1) Under the terms of the BigCommerce Holdings, Inc. 2013 Equity Incentive Plan , the option exercise price shall not be less than the fair market value of a share of our common stock on the effective date of grant of the option. |
Outstanding Equity Awards at Fiscal Year-End Table
Except with respect to the option awards granted on March 13, 2021 (as described in Note 4 below) and March 8, 2022 (as described in Note 5 below), the NEOs’ options set forth in the table above are immediately exercisable upon grant as to the underlying shares of common stock and, to the extent such shares are exercised and unvested as of the NEO’s termination of service, such exercised and unvested shares are subject to a right of repurchase by us upon the NEO’s termination of service. With respect to such options, this column reflects the number of shares subject to options that were exercisable and vested as of December 31, 2023.
Outstanding Equity Awards at Fiscal Year-End Table
| (2) Under the terms of the 2020 Plan, the option exercise price must be greater than or equal to 100% of the closing price of a share of our common stock on the date of grant. |
Outstanding Equity Awards at Fiscal Year-End Table
Except with respect to the option awards granted on March 13, 2021 (as described in Note 4 below) and March 8, 2022 (as described in Note 5 below), the NEOs’ options set forth in the table above are immediately exercisable upon grant as to the underlying shares of common stock and, to the extent such shares are exercised and unvested as of the NEO’s termination of service, such exercised and unvested shares are subject to a right of repurchase by us upon the NEO’s termination of service. With respect to such options, this column reflects the number of shares subject to options that were exercisable and unvested as of December 31, 2023.
Outstanding Equity Awards at Fiscal Year-End Table
| (3) Amounts are calculated based on multiplying the number of shares shown in the table by the per share closing price of our common stock on December 29, 2023, which was $9.73. |
Outstanding Equity Awards at Fiscal Year-End Table
| (4) Represents an option that vested as to 25% of the underlying shares on March 13, 2022 and vested or vests with respect to 1/48th of the shares in substantially equal monthly installments over the following 36 months, subject to the NEO’s continued service through each such vesting date. |
Outstanding Equity Awards at Fiscal Year-End Table
| (5) Represents an option that vested as to 25% of the underlying shares on March 8, 2023 and that vested or vests, as applicable, with respect to 1/48th of the shares in substantially equal monthly installments over the following 36 months, subject to the NEO’s continued service through each such vesting date. |
Outstanding Equity Awards at Fiscal Year-End Table
| (6) Represents an option that will vest as to 25% of the underlying shares on March 21, 2024 and with respect to 1/48th of the shares in substantially equal monthly installments over the following 36 months, subject to the NEO’s continued service through each such vesting date. |
Outstanding Equity Awards at Fiscal Year-End Table
| (7) Represents an option that will vest as to 25% of the underlying shares on June 30, 2024 and with respect to 1/48th of the shares in substantially equal monthly installments over the following 36 months, subject to the NEO’s continued service through each such vesting date. |
Outstanding Equity Awards at Fiscal Year-End Table
| (8) Represents RSUs vesting with respect to 25% of the underlying shares in substantially equal annual installments on each of the first four anniversaries of May 27, 2020, subject to the NEO’s continued service through each such vesting date. |
Outstanding Equity Awards at Fiscal Year-End Table
| (9) Represents RSUs vesting with respect to 25% of the underlying shares in substantially equal annual installments on each of the first four anniversaries of March 1, 2021, subject to the NEO’s continued service through each such vesting date. |
Outstanding Equity Awards at Fiscal Year-End Table
| (10) Represents RSUs vesting with respect to 25% of the underlying shares in substantially equal annual installments on each of the first four anniversaries of March 21, 2022, subject to the NEO’s continued service through each such vesting date. |
Outstanding Equity Awards at Fiscal Year-End Table
| (11) Represents RSUs vesting with respect to 25% of the underlying shares in substantially equal annual installments on each of the first four anniversaries of March 21, 2023, subject to the NEO’s continued service through each such vesting date. |
Outstanding Equity Awards at Fiscal Year-End Table
| (12) Represents RSUs vesting with respect to 25% of the underlying shares in substantially equal annual installments on each of the first four anniversaries of June 30, 2023, subject to the NEO’s continued service through each such vesting date. |
Outstanding Equity Awards at Fiscal Year-End Table
| (13) Represents an option that would have vested as to 25% of the underlying shares on August 28, 2024 and that would have vested with respect to 1/48th of the underlying shares thereafter in substantially equal monthly installments over the following 36 months, subject to the NEO’s continued service through each such vesting date. This option was forfeited in connection with the NEO’s resignation effective February 16, 2024. |
Outstanding Equity Awards at Fiscal Year-End Table
| (14) Represents RSUs that would have vested with respect to 25% of the underlying shares in substantially equal annual installments on each of the first four anniversaries of August 28, 2023, |
Outstanding Equity Awards at Fiscal Year-End Table
subject to the NEO’s continued service through each such vesting date. These RSUs were forfeited in connection with the NEO’s resignation effective February 16, 2024.
Option Exercises and Stock Vested in Fiscal 2023
Option Exercises and Stock Vested in Fiscal 2023
Option Exercises and Stock Vested in Fiscal 2023
| | Option Awards | | Stock Awards | | | Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise(1) ($) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting(2) ($) | | Brent Bellm | - | - | 151,266 | 1,259,455 | | Daniel Lentz | - | - | 17,253 | 143,497 | | Robert Alvarez | 384,998 | 3,142,021 | 54,949 | 456,665 | | Russell Klein | - | - | 51,740 | 432,180 | | Brian Dhatt | - | - | 38,349 | 324,615 | | Steven Chung | - | - | - | - | | Marc Ostryniec | - | - | 30,035 | 251,762 |
Option Exercises and Stock Vested in Fiscal 2023
| (1) Amounts are calculated by multiplying the number of shares as to which the option was exercised by the market price of the shares on the exercise date, net of the exercise price. |
Option Exercises and Stock Vested in Fiscal 2023
| (2) Amounts are calculated by multiplying the number of shares vested by our closing stock price on the vesting date. |
Potential Payments Upon Termination or Change in Control
Potential Payments Upon Termination or Change in Control
Estimated Potential Payments
Estimated Potential Payments The following table summarizes the payments that would be made to our NEOs (other than Mr. Alvarez, who ceased employment with us in June 2023, and Mr. Ostryniec who ceased employment with us in November 2023 and received the separation payments and benefits described above) upon the occurrence of certain qualifying terminations of employment or a change in control, in any case, occurring on December 31, 2023. Amounts shown do not include (i) accrued but unpaid base salary through the date of termination or (ii) other benefits earned or accrued by the NEO during his employment that are available to all salaried employees, such as accrued vacation.
Estimated Potential Payments
| Name | Benefit (1) | Termination Without Cause or (as applicable) for Good Reason (no Change in Control) ($) | Change in Control (no Termination) ($) | Termination Without Cause or for Good Reason in Connection with a Change in Control ($) | | Brent Bellm | Cash | 486,538 | 0 | 486,538 | | | Equity Acceleration | 0 | 0 | 5,215,261 | | | Continued Healthcare | 9,918 | 0 | 9,918 | | | Total | 496,456 | 0 | 5,711,717 | | Daniel Lentz | Cash | 177,933 | 0 | 355,865 | | | Equity Acceleration | 0 | 0 | 1,269,327 | | | Continued Healthcare | 5,419 | 0 | 10,838 | | | Total | 183,352 | 0 | 1,636,030 | | Russell Klein | Cash | 197,116 | 0 | 394,231 | | | Equity Acceleration | 0 | 0 | 2,176,844 | | | Continued Healthcare | 3,645 | 0 | 7,291 | | | Total | 200,761 | 0 | 2,578,366 | | Brian Dhatt | Cash | 197,116 | 0 | 394,231 | | | Equity Acceleration | 0 | 0 | 1,436,761 | | | Continued Healthcare | 3,415 | 0 | 6,830 | | | Total | 200,531 | 0 | 1,837,822 | | Steven Chung | Cash | 230,000 | 0 | 460,000 | | | Equity Acceleration | 0 | 0 | 2,652,709 | | | Continued Healthcare | 5,419 | 0 | 10,838 | | | Total | 235,419 | 0 | 3,123,547 |
Estimated Potential Payments
| (1) The value of equity acceleration was calculated by multiplying the number of accelerated shares of common stock underlying the applicable equity award by $9.73, the closing price of our common stock on December 31, 2023 and, with respect to equity awards in the form of stock options, subtracting the exercise price thereof. |
2023 DIRECTOR COMPENSATION
2023 DIRECTOR COMPENSATION The following table provides compensation information for fiscal year 2023 for each non-employee member of our Board. Neither our Chief Executive Officer and President, who currently serves as Chairman of our Board, nor our investor-affiliated Board members, Messrs. Bohn and Richards, receive compensation for Board or committee service.
2023 DIRECTOR COMPENSATION
| Name | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(2) | Option Awards ($) | Non-Equity Incentive Plan Compensation ($) | Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) | All Other Compensation ($) | Total ($) | | Don Clarke | — | 218,488(3) | — | — | — | — | 218,488 | | Sally Gilligan | — | 209,048(4) | | | | | 209,048 | | Satish Malhotra | — | 206,689(5) | — | — | — | — | 206,689 | | Ellen Siminoff | — | 214,247(6) | — | — | — | — | 214,247 |
2023 DIRECTOR COMPENSATION
| (1) Each non-employee director elected to receive his or her Board and committee retainers in the form of RSU awards in lieu of cash. |
2023 DIRECTOR COMPENSATION
| (2) Board and committee retainers were earned quarterly and paid in the form of RSU awards on May 18, 2023, August 10, 2023, November 10, 2023, and March 9, 2024 (in respect of retainers earned during the first, second, third and fourth quarters of 2023, respectively). To determine the number of RSUs granted in lieu of any quarterly cash retainers, we divided the aggregate retainer earned for the applicable quarter by the average closing price per share of our common stock over the thirty consecutive trading days ending on the last business day prior to the applicable RSU grant date. |
2023 DIRECTOR COMPENSATION
Amounts reported in this column reflect the full grant-date fair value of the RSU awards granted during 2023 granted in lieu of Board and committee retainers earned during 2023, in each case, computed in accordance with ASC Topic 718. We provide information regarding the assumptions used to calculate the value of all RSU awards granted in Note 11 to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. For additional information regarding the RSU awards granted in lieu of Board and Committee retainers, please see Notes (3), (4), (5), (6) and (7) below.
2023 DIRECTOR COMPENSATION
| (3) Represents the sum of (i) $51,917, which is the sum of the grant-date fair value of the RSUs granted in lieu of Board and committee retainers earned during 2023 and (ii) $166,571, which is the grant-date fair value of the annual RSU grant made to Mr. Clarke on May 18, 2023. The annual RSU grant vests in full on the 1-year anniversary of the applicable grant date, subject to Mr. Clarke’s continued service through such date. |
2023 DIRECTOR COMPENSATION
| (4) Represents the sum of (i) $42,477, which is the sum of the grant-date fair value of the RSUs granted in lieu of Board and committee retainers earned during 2023 and (ii) $166,571, which is the grant-date fair value of the annual RSU grant made to Ms. Gilligan on May 18, 2023. The annual RSU grant vests in full on the 1-year anniversary of the applicable grant date, subject to Ms. Gilligan’s continued service through such date. |
2023 DIRECTOR COMPENSATION
| (5) Represents the sum of (i) $40,118, which is the sum of the grant-date fair value of the RSUs granted in lieu of Board and committee retainers earned during 2023 and (ii) $166,571, which is the grant-date fair value of the annual RSU grant made to Mr. Malhotra on May 18, 2023. The annual RSU grant vests in full on the 1-year anniversary of the applicable grant date, subject to Mr. Malhotra’s continued service through such date. |
2023 DIRECTOR COMPENSATION
| (6) Represents the sum of (i) $47,676, which is the sum of the grant-date fair value of the RSUs granted in lieu of Board and committee retainers earned during 2023 and (ii) $166,571, which is the grant-date fair value of the annual RSU grant made to Ms. Siminoff on May 18, 2023. The annual RSU grant vests in full on the 1-year anniversary of the applicable grant date, subject to Ms. Siminoff’s continued service through such date. |
2023 DIRECTOR COMPENSATION
The table below shows the aggregate numbers of shares underlying option awards (exercisable and unexercisable) and unvested stock awards held as of December 31, 2023 by each non-employee director. Neither Messrs. Bohn nor Richards hold Company option or stock awards.
2023 DIRECTOR COMPENSATION
| Name | Option Awards Outstanding at 2023 Fiscal Year End | Unvested Stock Awards Outstanding at 2023 Fiscal Year End | | Don Clarke | — | 23,007 | | Sally Gilligan | — | 23,007 | | Satish Malhotra | — | 23,007 | | Ellen Siminoff | — | 23,007 |
Non-Employee Director Compensation Program
Non-Employee Director Compensation Program We maintain a compensation program for our non-employee non-investor-affiliated directors under which each non-employee non-investor-affiliated director receives the following amounts for their service on the Board:
Non-Employee Director Compensation Program
| · | an annual cash retainer of $35,000; |
Non-Employee Director Compensation Program
| · | an additional annual cash retainer of $10,000 for the Chairman of the Board (who is currently ineligible to receive this payment due to his service as our Chief Executive Officer and President) and $20,000 for the Lead Independent Director; |
Non-Employee Director Compensation Program
| · | an annual cash retainer of $20,000 for the Chair of the Audit Committee, $15,000 for the Chair of the Compensation Committee, and $8,000 for the Chair of the Nominating and Corporate Governance Committee; |
Non-Employee Director Compensation Program
| · | an annual cash retainer of $10,000 for each member of the Audit Committee, $7,500 for each member of the Compensation Committee, and $4,000 for each member of the Nominating and Corporate Governance Committee; and |
Non-Employee Director Compensation Program
| · | an annual equity award with an approximate value of $181,300 in the form of RSUs, which vest in full on the one-year anniversary of the applicable vesting commencement date, subject to the director’s continuous service with us through the applicable vesting date. |
Non-Employee Director Compensation Program
Director fees under the program are payable in arrears in four equal quarterly installments, provided that the amount of each payment is prorated for any portion of a quarter that a director is not serving on our Board. In 2023, all eligible directors elected to receive their annual cash retainers in the form of RSUs; accordingly, all 2023 compensation was paid in the form of RSU awards in lieu of cash. * * * * *
CEO PAY RATIO
CEO PAY RATIO 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, we are providing the following information regarding the ratio of the annual total compensation of our median employee to the annual total compensation of Brent Bellm, our Chief Executive Officer (our “CEO”). We consider the pay ratio specified below to be a reasonable estimate, calculated in a manner that is intended to be consistent with the requirements of Item 402(u) of Regulation S-K. For 2023, the annual total compensation of the employee who represents our median compensated employee (other than our CEO) was $107,111. The annualized total compensation of our CEO for 2023 was $4,658,863. Based on this information, for 2023, the annual total compensation of our CEO was approximately 43.5 times the median of the annual total compensation of all of our employees (other than the CEO). We believe the pay ratio included in this information is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K. The Company used our employee population data as of December 31, 2023 as the reference date for identifying our median employee. As of such date, our employee population consisted of approximately 1,321 individuals. To identify the median employee from our employee population, we used target cash compensation, which was defined as annualized base salary/hourly wages plus any target bonuses or commissions. In identifying the median employee, we assumed standard working hours for hourly employees and converted all non-US employee compensation to USD using the currency exchange rate as of December 31, 2023. With respect to the annual total compensation of the employee who represents our median compensated employee, we calculated such employee’s compensation for 2023 in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K. With respect to the annual total compensation of our CEO, we used the amount reported in the “Total” column of our 2023 Summary Compensation Table included in this Proxy Statement.
PAY VERSUS PERFORMANCE
PAY VERSUS PERFORMANCE In accordance with rules adopted by the Securities and Exchange Commission pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the following table sets forth information regarding compensation for our Chief Executive Officer (referred to in this discussion as our principal executive officer (or “PEO”) and our NEOs other than our PEO (our “Non-PEO NEOs”) and Company performance for the fiscal years listed below.
PAY VERSUS PERFORMANCE
| | Summary Compensation Table Total for PEO¹ ($) | Compensation Actually Paid to PEO 1,2,3 ($) | Average Summary Compensation Table Total for Non-PEO NEOs¹ ($) | Average Compensation Actually Paid to Non- PEO NEOs 1,2,3 ($) | Value of Initial Fixed $100 | | | | | | | | | | Investment based on: 4 | | | | | | | | | | | Peer Group TSR ($) | | | | | | | | | TSR ($) | | Net Income ($ Millions) | Revenue ($ Millions) 5 | | Year | | | | | | | | | | (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | | 2023 | 4,658,863 | 4,542,772 | 2,077,737 | 1,624,413 | 13.46 | 171.79 | (65) | 309 | | 2022 | 7,270,118 | -7,575,979 | 2,487,512 | -1,565,981 | 12.09 | 103.19 | (140) | 279 | | 2021 | 7,387,604 | -9,728,745 | 2,739,562 | -824,148 | 48.94 | 160.67 | (77) | 220 | | 2020 | 6,308,108 | 54,956,192 | 2,524,420 | 16,380,993 | 88.76 | 116.55 | (38) | 152 |
PAY VERSUS PERFORMANCE
| (1) Brent Bellm was our PEO for each year presented. The individuals comprising the Non-PEO NEOs for each year presented are listed below. |
PAY VERSUS PERFORMANCE
| 2020 | 2021 | 2022 | 2023 | | Robert Alvarez | Robert Alvarez | Robert Alvarez | Robert Alvarez | | Russell Klein | Russell Klein | Russell Klein | Daniel Lentz | | | Brian Dhatt | Brian Dhatt | Russell Klein | | | Robert Kaloustian | Lisa Eggerton | Brian Dhatt | | | | | Marc Ostryniec |
PAY VERSUS PERFORMANCE
(2) The amounts shown for Compensation Actually Paid have been calculated in accordance with Item 402(v) of Regulation S-K and do not reflect compensation actually earned, realized, or received by the PEO or Non-PEO NEOs. These amounts reflect the total compensation reported in the Summary Compensation Table for the applicable year, with certain adjustments as described in footnote 3 below. (3) Compensation Actually Paid reflects the exclusions and inclusions of certain amounts for the PEO and the Non-PEO NEOs as set forth below. Equity values are calculated in accordance with FASB ASC Topic 718 based on the closing price per share on the applicable year-end date(s) or, in the case of vesting dates, the closing price per share on the applicable vesting date(s). For additional information on the assumptions used to calculate the valuation of the awards, see the Notes to Consolidated Financial Statements in our Annual Report on Form 10-K for the applicable fiscal year. Amounts in the Exclusion of Stock Awards and Option Awards column of the tables below are the totals from the Stock Awards and Option Awards columns set forth in the Summary Compensation Table.
PAY VERSUS PERFORMANCE
| | | Average for Non- | | | PEO | PEO NEOs | | Summary Compensation Total | 4,658,863 | 2,077,737 | | - Change in Pension Value and Above Market Non-Qualified Deferred Compensation | 0 | 0 | | - Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year | (3,743,657) | (1,635,451) | | + Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year | 3,416,746 | 1,334,900 | | + Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Years | 273,554 | 33,695 | | + Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year That Vested During Fiscal Year | 0 | 0 |
PAY VERSUS PERFORMANCE
| + Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years For Which Applicable Vesting Conditions Were Satisfied During Fiscal Year | (62,735) | (9,214) | | - Fair Value as of Prior Fiscal Year-End of Option Awards and Stock Awards Granted in Prior Fiscal Years That Failed to Meet Applicable Vesting Conditions During Fiscal Year | 0 | (177,253) | | + Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation | 0 | 0 | | Compensation Actually Paid | 4,542,772 | 1,624,413 |
PAY VERSUS PERFORMANCE
| (1) Represents the cumulative total shareholder return (“Peer Group TSR”) of the NASDAQ Computer Index, which we also utilize in the stock performance graph required by Item 201(e)(ii) of Regulation S-K included in our Annual Report for the year ended December 31, 2023. The comparison assumes an initial fixed $100 investment for the period starting at the close of trading on August 5, 2020, the Company’s first trading day, through the end of the listed year in the Company and in the NASDAQ Computer Index, respectively, assuming that all dividends (if any) were reinvested. |
PAY VERSUS PERFORMANCE
| (2) Revenue is a GAAP measure. |
Narrative Disclosure to Pay Versus Performance Table
Narrative Disclosure to Pay Versus Performance Table Description of Relationship Between PEO and Non-PEO NEO Compensation Actually Paid and Total Shareholder Return (“TSR”) The following chart sets forth the relationship between Compensation Actually Paid to our PEO, the average of Compensation Actually Paid to our Non-PEO NEOs, and the cumulative TSR over the four most recently completed fiscal years for the Company and the NASDAQ Computer Index. TSR values begin with and are indexed to close of trading on August 5, 2020, the date of the Company’s first trading day. NEO Compensation Actually Paid and Net Income The following chart sets forth the relationship between Compensation Actually Paid to our PEO, the average of Compensation Actually Paid to our Non-PEO NEOs, and our net income during the four most recently completed fiscal years. Description of Relationship Between PEO and Non-PEO NEO Compensation Actually Paid and Company-Selected Measure The following chart sets forth the relationship between Compensation Actually Paid to our PEO, the average of Compensation Actually Paid to our NEOs, and our revenue during the four most recently completed fiscal years. Tabular List of Most Important Financial Performance Measures The following table presents the financial performance measures that the Company considers to have been the most important in linking Compensation Actually Paid to our PEO and Non-PEO NEOs for 2023 to Company performance. The measures in this table are not ranked in order of importance. Revenue Adjusted EBITDA Annual revenue run-rate growth For additional details regarding our most important financial performance measures, please see the sections titled “2023 Compensation Highlights” and “Cash Incentive Compensation” in our Compensation Discussion and Analysis (CD&A) elsewhere in this Proxy Statement.