DEF 14A of Turtle Beach Corp, Apr 29, 2024

DEF 14A of Turtle Beach Corp

Filed Apr 29, 2024 · FY20230001193125-24-122708

Open on EDGAR

  1. Terry Jimenez

    | | Page | | CEO Pay Ratio | 51 | | Employment Arrangements | 52 | | Post-Employment Compensation Arrangements | 52 | | Potential Payments Upon Termination or Change in Control | 53 | | PAY VERSUS PERFORMANCE | 55 | | 2023 Pay-Versus-Performance Table | 55 | | Financial Performance Measures | 57 | | Relationship Between Compensation Actually Paid and Performance Measures | 57 | | DIRECTOR COMPENSATION | 61 | | CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS | 63 | | DELINQUENT SECTION 16(a) REPORTS | 65 | | HOUSEHOLDING | 65 | | OTHER BUSINESS | 65 |

  2. Nominees for Director

    Nominees for Director

  3. Nominees for Director

    | Terry Jimenez | Age: 52 | | Chairman Since May 2023 Director Since October 2022 Committees Nominating and Governance (Member) | Biographical Information Terry Jimenez joined the Board in October 2022 and was named Chairman of the Board effective May 1, 2023. Mr. Jimenez is also a member of the Nominating and Governance Committee. Mr. Jimenez previously served as the Chief Executive Officer, President and member of the board of directors at Tribune Publishing Company, a publicly traded diversified media company with $1 billion in annual revenue, from February 2020 to May 2021, and as Chief Financial Officer from April 2016 to February 2020, Prior to Tribune Publishing, he was a Partner within IBM’s Global Business Services division working on large transactions in Australia, Brazil, UK, Poland, Holland, Italy and other countries. Earlier in his career, Mr. Jimenez served in a variety of finance, strategy and leadership roles with McDonald’s Corporation. Mr. Jimenez previously served as a Senior Advisor to Salad and Go from October 2022 to July 2023 and as a Consultant at G/O Media from November 2021 to March 2023. Mr. Jimenez previously served as Chairman of the BestReviews board and currently serves on the boards of the Ronald McDonald House Charities of Chicagoland/NW Indiana (including as Audit Committee Chair and Treasurer) and Northern Illinois University College of Business. Mr. Jimenez is currently an adjunct professor at Northern Illinois University teaching Accountancy for executive MBA programs in Naperville, Illinois and Bogota, Colombia. Mr. Jimenez received his MBA from Northwestern University’s Kellogg School of Business and his B.S. in Accounting from Northern Illinois University. Qualifications Mr. Jimenez has significant experience in executive leadership roles, M&A transactions, and capital allocation. Mr. Jimenez provides the Board with experience in multiple industries across the areas of product and intellectual property strategies, e-commerce and marketing, information technology, financial and operations, and public company boards. | | L. Gregory Ballard | Age: 70 | | Director Since April 2017 Committees Audit (Member) | Biographical Information Greg Ballard joined the Board in April 2017 and is a member of the Audit Committee. Since January 2021, Mr. Ballard has served as the managing partner of Coachella Advisors. Mr. Ballard also served as a member of the board of directors of TeamSpeak Systems, Inc. from February 2021 to July 2022. In addition, Mr. Ballard served as the general partner of Eleven Ventures, an operationally focused seed venture investment fund, from June 2016 to December 2020. Prior to joining Eleven Ventures, Mr. Ballard served as Senior Vice President of Mobile, Social and Emerging Platforms and Senior Vice President of Digital Games for Warner Bros. Interactive Entertainment from April 2013 to 2016 and October 2010 to 2016, respectively. From May 2010 to September 2010, Mr. Ballard served as Chief Executive Officer of Transpera, Inc., a mobile video advertising network. Mr. Ballard also served as president & CEO of Glu Mobile Inc., a publisher of mobile video games, from October 2003 to December 2009, served as CEO of SONICblue, Inc., Ancestry.com, and 3DFX Interactive, and held senior management roles for Virgin USA, Time Warner, and Capcom. Mr. Ballard has previously served on the boards of Better Place Forests Co., DTS Inc., Transpera, Inc., Glu Mobile Inc., Pinnacle Systems, Inc., Imagine Games Network, and THQ Inc. In addition, Mr. Ballard was a professor at Menlo College from August 2016 to August 2017, where he taught entrepreneurship and corporate law. Qualifications Mr. Ballard brings nearly 40 years of experience as an executive, investor, and entrepreneur with various technology companies Mr. Ballard’s significant expertise across gaming, mobile, and content, in addition to extensive management and board expertise, qualifies him to serve as a director. |

  4. Nominees for Director

    | 2024 Proxy Statement | 16 |

  5. Nominees for Director

    | Cris Keirn | Age: 53 | | Chief Executive Officer Director Since March 2024 | Biographical Information Mr. Keirn joined the Board in 2024. He has served as the CEO since March 2024. He previously served as the Company’s Interim CEO from July 2023 and Senior Vice President, Global Sales from August 2016, in each case until his appointment as CEO. As Senior Vice President, Global Sales, Mr. Keirn oversaw the growth and development of the Company’s headset business, was responsible for all consumer retail and sales account management and led the Company’s sales operations, customer care and market analytics teams. Prior to serving as Senior Vice President, Global Sales, Mr. Keirn served as Vice-President of Business Planning and Strategy and other roles at the Company, from February 2013 to August 2016. Prior to joining the Company, Mr. Keirn held leadership positions over a 17-year span at Motorola across product management, operations, quality and customer relations. Mr. Keirn received a B.S. in Mechanical Engineering from Purdue University and a Master’s Certificate in Project Management from George Washington University. Qualifications Mr. Keirn brings nearly 30 years of experience in the consumer electronics and telecom industries. Mr. Keirn’s deep understanding of Turtle Beach’s business through his various roles at the Company, including currently serving as the CEO, make him well-qualified to serve as a director. | | David Muscatel | Age: 54 | | Director Since March 2024 | Biographical Information Dave Muscatel joined the Board in 2024 following Turtle Beach’s acquisition of Performance Designed Products LLC (“PDP”). Mr. Muscatel has nearly 20 years of experience operating and managing private equity-backed businesses and is currently a Senior Operating Partner at Diversis Capital – the largest shareholder of Turtle Beach Corporation. Mr. Muscatel has served as the CEO of several companies, including Rand McNally, ArrowStream, Fusion Logistics, and Blue Software. He was also formerly the COO and CFO of PDP. In addition to Turtle Beach, Mr. Muscatel currently serves as a board member of, Fusion Logistics, PureCars Technologies Holdings, LLC, Inductive Health Informatics, LLC, Blackbox Intelligence Holdings, LLC, and WorldApp Inc. Mr. Muscatel received his MBA with honors from The University of Chicago Booth School of Business and graduated Cum Laude with a BA in Economics from Pomona College. Qualifications Mr. Muscatel brings nearly 20 years of experience operating and managing private equity-backed businesses. His deep knowledge of the video game accessory business from his time at PDP, as well as his wealth of experience in executive management, mergers and acquisitions, and strategic licensing, make him well-qualified to serve as a director. |

  6. Nominees for Director

    | 17 | |

  7. Nominees for Director

    | Katherine L. Scherping | Age: 64 | | Director Since May 2022 Committees Audit (Chair) Nominating and Governance (Member) | Biographical Information Katherine L. Scherping, CPA, CGMA joined the Board in May 2022 and is the Chair of the Audit Committee and a member of the Nominating and Governance Committee. Ms. Scherping has served as Chief Executive Officer of KLS Advisors, Inc., a financial and executive leadership advisory firm, since October 2011. Since December 2022, Ms. Scherping has served in various roles as a member of the board of directors, RE/MAX Holdings, Inc. (NYSE: RMAX), including as the Chair of the Finance and Investment Committee, and as a member of the Audit Committee. Ms. Scherping previously served as Chief Financial Officer of National CineMedia, Inc. (Nasdaq: NCMI), the largest cinema advertising network in the U.S., from August 2016 to March 2020. Ms. Scherping also served in various positions at QCE, LLC (d/b/a Quiznos Subs), a privately held quick-serve sub sandwich restaurant franchisor, including as Interim CEO in 2016 and Chief Financial Officer from December 2013 to July 2016. Previously, Ms. Scherping also served as Chief Financial Officer of Red Robin Gourmet Burgers, Inc. (Nasdaq: RRGB) and of Tanning Technology Corporation (formerly Nasdaq: TANN), which operated as an information technology services provider. Ms. Scherping served as chair of the audit committee of the board of directors of Papa Murphy’s Holdings, Inc. (formerly Nasdaq: FRSH), from February 2017 until its acquisition by MTY Food Group Inc. (OTC: MTYFF) in May 2019. Ms. Scherping received her B.S. in Accounting from Northern Illinois University. Qualifications Ms. Scherping has over 38 years of finance, accounting, and managerial experience. This experience, as well as her service as a public company board member and as the Chief Financial Officer of several public and private companies across multiple industries, including over 18 years in international hospitality and consumer businesses, make her well-qualified to serve as a director. |

  8. Nominees for Director

    | Julia W. Sze | Age: 57 | | Director Since December 2022 Committees Nominating and Governance (Chair) Compensation (Member) | Biographical Information Julia W. Sze, CFA joined the Board in December 2022 and is the Chair of the Nominating and Governance Committee and a member of the Compensation Committee. Since 2008, she has been at the forefront of the impact investing field, working to build better ESG standards in businesses at all stages. Ms. Sze currently serves on the board and audit and compensation committees of Cavco Industries Inc. (NASD: CVCO), the country’s third largest manufacturer of systems-built homes, and on the boards of Laird Norton Wealth Management and Tern Bicycles. Ms. Sze previously served as a member of the board of directors of Amalgamated Bank Foundation, a not-for-profit organization, from April 2019 to August 2021. Ms. Sze is a distinguished professional faculty member at UC Berkeley’s Haas School of Business and the University of New Mexico’s Anderson School of Management, where she teaches courses on impact investing and portfolio management. In addition to her public company board experience and financial and operations experience, Ms. Sze provides the board with extensive expertise in international capital markets and ESG best practices. Qualifications Ms. Sze has over 25 years of executive leadership experience in financial services as a global portfolio manager, hedge fund manager, and chief investment officer for large institutional portfolios. |

  9. Nominees for Director

    | 2024 Proxy Statement | 18 |

  10. Nominees for Director

    | Andrew Wolfe, Ph.D. | Age: 61 | | Director Since February 2012 Committees Audit (Member) Nominating and Governance (Member) | Biographical Information Andrew Wolfe, Ph.D. joined the Board in February 2012 and is a member of the Audit Committee and the Nominating and Governance Committee. Dr. Wolfe founded Wolfe Consulting in 2002, and currently serves as a technology and intellectual property consultant in the consumer electronics, computer, and semiconductor industries. Dr. Wolfe currently serves as a Director of IEEE Consultants Network of Silicon Valley. Dr. Wolfe is a limited partner of Pruneyard Cinemas LLP. Dr. Wolfe also testifies and serves as a consulting expert for intellectual property and other technology-related litigation matters. In addition, he serves as a lecturer at Santa Clara University where he teaches about Embedded Systems, Computer Architecture, and Mechatronics and he is currently a fellow at the Institute of Electrical and Electronic Engineers. Previously, Dr. Wolfe was Chief Technology Officer for SONICblue, Inc. (formerly S3, Inc.) from 1999 to 2002 and also served as Senior Vice President of Business Development from 2001 to 2002. Qualifications Dr. Wolfe has over 30 years of experience working with Fortune 500 corporations and technology startups, with expertise in developing new products and technologies as well as in product and intellectual property strategy. Dr. Wolfe’s notable technology, intellectual property, and licensing experience qualifies him to serve as a director. |

  11. Nominees for Director

    | William Wyatt | Age: 40 | | Director Since May 2023 Committees Compensation (Member) | Biographical Information William Wyatt joined the Board in May 2023. Since August 2018 Mr. Wyatt has been the Managing Partner of The Donerail Group LP, an investment management firm. Prior to Donerail, from March of 2015 Mr. Wyatt was a Portfolio Manager at Starboard Value LP, a New York-based investment adviser, where he served as the Head of Event Driven Investments. Mr. Wyatt also served in a variety of investment and leadership roles at Empyrean Capital, Magnetar Capital and Goldman Sachs. Qualifications Mr. Wyatt possesses extensive business and investment expertise, and executive-level experience. The Board believes that his experience as an investment manager makes him well-qualified to serve as a director. |

  12. Nominees for Director

    | The Board unanimously recommends a vote FOR each of the listed nominees by voting on the Proxy Card. |

  13. Nominees for Director

    | 19 | |

  14. Executive Compensation Philosophy and Objectives

    | • | provide market competitive compensation benefit levels that will attract, motivate, reward and retain a highly talented team of executives within the context of responsible cost management; |

  15. Executive Compensation Philosophy and Objectives

    | • | align the interests and objectives of our executives with those of our stockholders by linking their long-term incentive compensation opportunities to stockholder value creation and their cash incentives to our annual performance; and |

  16. Executive Compensation Philosophy and Objectives

    We structure the annual compensation of our Named Executive Officers using three principal elements: base salary, annual cash bonus opportunities and long-term equity incentive compensation opportunities in the form of equity awards. The design of our executive compensation program is influenced by a variety of factors, with the primary goals being to align the interests of our Named Executive Officers and stockholders and to link pay with performance. We have not adopted policies or employed guidelines for allocating compensation between current and long-term compensation, between cash and non-cash compensation or among different forms of non-cash compensation. As described below, the Compensation Committee considers a variety of factors in formulating and proposing the appropriate yearly mix among such compensatory elements, including our compensation philosophy and the value of outstanding equity awards granted in prior years.

  17. Compensation-Setting Process

    | • | the potential of each individual Named Executive Officer to contribute to our long-term financial, operational and strategic objectives; |

  18. Compensation-Setting Process

    | • | the compensation practices of our compensation peer group and the companies in selected broad-based compensation surveys and the positioning of each Named Executive Officer’s compensation in a ranking of peer company compensation levels based on an analysis of competitive market data; and |

  19. Compensation-Setting Process

    These factors provide the framework for formulating and making decisions regarding the compensation opportunity for each Named Executive Officer. No single factor is determinative in making these decisions, nor is the impact of any individual factor on the determination of pay levels quantifiable. The Compensation Committee does not weigh these factors in any predetermined manner, nor does it apply any formulas in formulating and making its compensation decisions for our Named Executive Officers. The members of the Compensation Committee consider this information in light of their individual experience, knowledge of the Company, knowledge of the competitive market, knowledge of each Named Executive Officer and business judgment in making their decisions. The Compensation Committee engages in a biennial analysis of our executive compensation levels against other companies’ compensation programs and practices to establish our compensation levels with respect to our Named Executive Officers. In formulating and making its decisions, the Compensation Committee reviews information summarizing the compensation paid at a representative group of peer companies, to the extent that the executive positions at these companies are considered comparable to our positions and informative of the competitive environment, and more broad-based compensation surveys to gain a general understanding of market compensation levels. Role of Management In discharging its responsibilities, the Compensation Committee works with members of our management, including our CEO. Our management assists the Compensation Committee by providing information on corporate and individual performance, and management’s perspective on compensation matters. The Compensation Committee solicits and reviews our CEO’s proposals (except with respect to his own compensation) with respect to program structures, as well as his recommendations for adjustments to annual cash compensation, long-term incentive compensation opportunities and other compensation-related matters for our Other NEO, based on his evaluation of the other NEO’s performance for the prior year. The Compensation Committee reviews and discusses our Chief Executive Officer’s proposals and recommendations and considers them as one factor in formulating and making its decisions with respect to the compensation of our Named Executive Officers. Our CEO also attends meetings of our Board and the Compensation Committee at which executive compensation matters are addressed, except with respect to discussions involving his own compensation. With respect to the design of 2024 executive compensation programs, the Compensation Committee took a more independent role in establishing the key terms of the incentive plans and approved compensation levels. Role of Compensation Consultant The Compensation Committee has the sole authority to retain an external compensation consultant to assist it by providing information, analysis and other advice relating to our executive compensation program and the recommendations and decisions resulting from its annual executive compensation review, including the authority to approve the consultant’s reasonable fees and other retention terms. The compensation consultant reports directly to the Compensation Committee and its chair and serves at the discretion of the Compensation Committee, which reviews the engagement annually. In 2023, the Compensation Committee engaged Compensia, to serve as its compensation consultant and advise on select executive compensation matters and the selection of the compensation peer group. During 2023, Compensia provided the following services:

  20. Compensation-Setting Process

    | • | conducted an annual review and provided recommendations with respect to the compensation peer group; |

  21. Compensation-Setting Process

    | • | provided detailed short- and long-term incentive compensation design practices; |

  22. Compensation-Setting Process

    | • | assessed peer group and market best practices for compensating the non-employee members of our Board who are considered independent directors; |

  23. Compensation-Setting Process

    The terms of Compensia’s engagement include reporting directly to the Compensation Committee chair. The Compensation Committee has evaluated its relationship with Compensia to ensure that it believes that such firm is independent from management. This review process included a review of the services that Compensia provided, the quality of those services and the fees associated with the services provided during 2023. Based on this review, as well as consideration of the factors affecting independence set forth in Exchange Act Rule 10C-1(b)(4), Rule 5605(d)(3)(D) of the NASDAQ Marketplace Rules and such other factors as were deemed relevant under the circumstances, the Compensation Committee has determined that no conflict of interest was raised as a result of the work performed by Compensia. Competitive Positioning The Compensation Committee believes that peer group comparisons are useful guides to measure the competitiveness of our executive compensation program and related policies and practices. For purposes of assessing our executive compensation against the competitive market, the Compensation Committee reviews and considers the compensation levels and practices of a select group of peer companies. This compensation peer group consists of consumer-related technology companies that are similar to us in terms of revenue, market capitalization and industry focus. The competitive data drawn from this compensation peer group is one of several factors that the Compensation Committee uses to formulate and make its decisions every two years with respect to the compensation of our Named Executive Officers. In November 2022, the Compensation Committee directed Compensia to review the compensation peer group to determine if any adjustments were required in advance of conducting formal assessments to frame 2023 pay decisions. Compensia evaluated the existing peer group based on the same primary selection criteria as used in past years, which included:

  24. Compensation-Setting Process

    In July 2023, the Compensation Committee commenced a process to assess the selection criteria and peer group companies to account for changes in our business and financial profile. The goal of the process was to ensure the peer group underlying our competitive market analysis was appropriate and defensible. Based on the review, six companies that were outside the revenue or market capitalization ranges and/or deemed not close business matches were removed (Agilsys, Harmonic, Digital Turbine, CalAmp, EMCORE and VOXX International). Eight companies, all included in Institutional Shareholder Services’ self-constructed peer group, in a similar industry sector and within both the revenue and market capitalization ranges (Applied Optoelectronics, AstroNova, Aviat Networks, KVH Industries, Lantronix, PAR Technology, PCTEL and Quantum) were added. In October 2023, the Compensation Committee formally approved the 2024 peer group as listed below:

  25. Compensation Elements

    Compensation Elements Generally, our executive compensation program consists of three principal elements – annual base salary, annual cash bonus opportunities and long-term incentive compensation opportunities in the form of equity awards. Our executive compensation

  26. Compensation Elements

    | Compensation Element | 2023 Program Design | Objective | | Annual Base Salary | • Moderate adjustments following no increases since 2021 | Designed to attract and retain executives by providing fixed compensation in amounts that are competitive in the market and reward performance | | Annual Cash Bonus Program | • Corporate performance metric weighting – financial metrics (70% for CEO and CFO; 60% for other executives) and individual strategic objectives (30% for CEO and CFO; 40% for other executives) • Financial performance metrics (and weighting) – net revenue (50%) and Adjusted EBITDA (50%) • Bonus payment range – 0% to 200% of target performance | Designed to motivate executives to achieve annual business objectives and provide financial benefits when we meet or exceed these objectives | | Long-Term Incentive Compensation Program | • Equity award mix and weighting – 50% performance stock unit awards and 50% restricted stock unit awards for Mr. Stark; 30% performance stock unit awards and 70% restricted stock unit awards for Messrs. Keirn and Hanson • PSU award metrics – revenue growth in excess of market growth (50%) and Adjusted EBITDA margin (50%) • PSU award performance period – performance measured over one year with additional time-based vesting for earned units over two years; all pre-established performance levels approved before commencement of performance period • PSU award payment cap – 200% of target performance • RSU award vesting requirement – equal annual increments over four years | Designed to align the interests of executives and stockholders by motivating executives to create sustainable long-term stockholder value |

  27. Compensation Elements

    2023 Target Pay Mix The Compensation Committee believes that the characteristics of each form of executive compensation are a key driver in determining the allocation of target total direct compensation. The following graphs represent the 2023 target mix of annual target total direct compensation for Messrs. Stark and Hanson. The disclosed equity award percentages below represent the grant date fair value of the PSU awards and RSU awards granted to these Named Executive Officers in 2023, and not the compensation actually paid to or realized by such Named Executive Officers. Mr. Keirn’s pay mix is not included as it was initially determined prior to him serving in a named executive officer role. Annual Base Salary Base salary represents the fixed portion of the compensation of our Named Executive Officers and is an important element of compensation intended to attract and retain highly talented individuals. We use base salary to provide each Named Executive Officer with a specified level of cash compensation during the year with the expectation that he will perform his responsibilities to the best of his ability and in our best interests. Generally, we establish the initial base salaries of our Named Executive Officers through arm’s-length negotiation at the time we hire or promote the individual, taking into account his or her position, qualifications, experience, prior salary level and the base salaries of our other executive officers. Thereafter, the Compensation Committee reviews the base salaries of our Named Executive Officers each year as part of its annual review of our executive compensation program, with input from our CEO (except with respect to his own base salary) and formulates and makes decisions for adjustments as it determines to be reasonable and necessary to reflect the scope of a Named Executive Officer’s performance, individual contributions and responsibilities, position in the case of a promotion and competitive market conditions. In April 2023, as part of its annual review of our executive compensation program, the Compensation Committee reviewed the annual base salaries of our then-incumbent Named Executive Officers, Messrs. Stark and Hanson, taking into consideration a competitive market analysis prepared by Compensia and the recommendations of Mr. Stark (except with respect to his own base salary), as well as the other factors described in “Compensation-Setting Process—Setting Target Total Direct Compensation” above. Following this review, the Compensation Committee approved 5% increases in the annual base salaries of Messrs. Stark and Hanson. The annual base salaries of Messrs. Stark and Hanson for 2022 and 2023 were as follows:

  28. Compensation Elements

    The annual base salaries of our Named Executive Officers during 2023 are set forth in the “2023 Summary Compensation Table” below. Annual Cash Bonus Program We use an annual cash bonus program to motivate our Named Executive Officers to achieve our annual business goals. In April 2023, the Compensation Committee approved the 2023 Bonus Plan to provide incentives for our Named Executive Officers to meet or exceed the principal business objectives set forth in our 2023 annual operating plan. Pursuant to the 2023 Bonus Plan, the Compensation Committee formulated and determined a target annual cash bonus opportunity for each participant in the plan and corporate and individual performance goals for the plan, with awards payable based on our 2023 actual performance. The Compensation Committee determined that 70% of our then-incumbent Named Executive Officers’ target annual cash bonus opportunities would be based on corporate performance and 30% on their individual performance. Other executives’, including Mr. Keirn’s, bonus opportunity was based 60% on corporate performance and 40% on their individual performance. Under the 2023 Bonus Plan, payments were to be made based on our performance with respect to each of the corporate performance metrics and the individual performance metrics to the extent to which each objective was achieved for the year. Target Annual Cash Bonus Opportunities For purposes of the 2023 Bonus Plan, cash bonuses were to be based upon a specific percentage of each Named Executive Officer’s annual base salary. In April 2023, as part of its annual review of our executive compensation program, the Compensation Committee reviewed the target annual cash bonus opportunities of our then-incumbent Named Executive Officers, Messrs. Stark and Hanson, taking into consideration a competitive market analysis prepared by Compensia and the recommendations of Mr. Stark (except with respect to his own target annual cash bonus opportunity), as well as the other factors described in “Compensation-Setting Process—Setting Target Total Direct Compensation” above. Following this review, the Compensation Committee determined to set the target annual cash bonus opportunities for 2023 for Messrs. Stark, Hanson and Keirn as follows:

  29. Compensation Elements

    | Named Executive Officer | 2023 Target Annual Cash Bonus Opportunity (as a percentage of base salary) (%) | 2023 Target Annual Cash Bonus Opportunity ($) | | Mr. Stark | 100% | $630,000 | | Mr. Hanson | 70% | $276,500 | | Mr. Keirn | 80% | $328,000 |

  30. Compensation Elements

    Potential annual cash bonuses for our Named Executive Officers under the 2023 Bonus Plan could range from zero to 200% of their target annual cash bonus opportunity. Corporate Performance Metrics Under the 2023 Bonus Plan, Messrs. Stark, Hanson and Keirn were eligible to receive payments with respect to their target annual cash bonus opportunities based upon our achievement of one or more corporate performance metrics that were selected by the Compensation Committee. Consistent with the 2022 Bonus Plan, the Compensation Committee selected net revenue and Adjusted EBITDA as the two equally weighted corporate financial performance metrics for 2023. The Compensation Committee believed these two financial performance metrics were appropriate because, in its view, they were strong indicators of successful execution of our annual operating plan and they provided a strong emphasis on growth while managing expenses and strengthening our customer and employee relationships. The Compensation Committee also believed these metrics would also most directly influence the creation of sustainable long-term stockholder value. For purposes of the 2023 Bonus Plan:

  31. Compensation Elements

    | Performance Level | Net Revenue (Weighted 50%) | | | Adjusted EBITDA (Weighted 50%) | | | | Revenue ($) | Payment (percentage of target) | | Adjusted EBITDA ($) | Payment (percentage of target) | | Below Threshold | <$232,000,000 | -0- | | <$4,100,000 | -0- | | Threshold | $232,000,000 | 50 | | $4,100,000 | 40% | | Target | $272,800,000 | 100 | | $6,800,000 | 100% | | Maximum | $491,040,000 | 500 | %(1) | $10,000,000 | 200% |

  32. Compensation Elements

    | (1) Although payout for the net revenue target has a maximum of 500%, the maximum overall bonus payout is capped at 200% of overall target. |

  33. Compensation Elements

    Annual Cash Bonus Payments In March 2024, the Compensation Committee determined that, for 2023, our actual net revenue was $258.1 million and our actual Adjusted EBITDA was $6.5 million. Based on these results, our Named Executive Officers received 88% of their target annual cash bonus opportunity with respect to the corporate financial performance metrics. In addition, in March 2024, Mr. Keirn evaluated the individual performance of Mr. Hanson against each of his individual performance metrics list and the Compensation Committee evaluated the performance of Mr. Keirn against his individual performance metrics, both as listed above. The following table sets forth the target annual cash bonus opportunities and the actual annual cash bonus payments made to Messrs. Keirn and Hanson for 2023 as approved by the Compensation Committee:

  34. Compensation Elements

    The annual cash bonuses paid to our Named Executive Officers during 2023 are set forth in the “2023 Summary Compensation Table” below. Long-Term Incentive Compensation As a technology company that encounters significant competition for qualified personnel, long-term incentive compensation plays a critical role in our ability to attract, hire, motivate and reward qualified and experienced executive officers. The use of long-term incentive compensation in the form of equity awards is necessary for us to compete for qualified executive officers without significantly increasing cash compensation and is the most important element of our executive compensation program. We use equity awards to incentivize and reward our Named Executive Officers for long-term corporate performance based on the value of our Common Stock and, thereby, to align their interests with the interests of our stockholders. The realized value of these equity awards bears a direct relationship to our stock price, and, therefore, these awards are an incentive for our Named Executive Officers to create value for our stockholders. Equity awards also help us retain our Named Executive Officers in a highly competitive market. In 2023, the Compensation Committee used a combination of PSU awards that may be earned and settled for shares of our Common Stock and/or time-based RSU awards that may be settled for shares of our Common Stock to motivate and reward our Named Executive Officers for long-term increases in the value of our Common Stock. The Compensation Committee believes that these equity awards align the interests of our Named Executive Officers with the interests of our stockholders by providing a significant incentive for them to manage our business from the perspective of an owner with an equity stake in the outcome of our financial and operational results and help us to achieve our retention objectives. In the case of PSU awards, the Compensation Committee believes that such awards serve as a highly effective source of motivation to our Named Executive Officers to drive our financial performance. In addition, PSU awards provide a direct link between compensation and stockholder return, thereby motivating our Named Executive Officers to focus on and strive to achieve both our annual and long-term financial and strategic goals. In addition, because RSU awards represent the right to receive shares of our Common Stock upon settlement and have value even in the absence of stock price appreciation, the Compensation Committee believes that we are able to incentivize and retain our Named Executive Officers using fewer shares of our Common Stock than would be necessary if we used other equity vehicles, such as stock options, to provide an equity stake in the Company. Since the value of RSU awards increases with any increase in the value of the underlying shares of our Common Stock, RSU awards also serve as an incentive that aligns the long-term interests of our Named Executive Officers with the interests of our stockholders. The Compensation Committee believes that a portfolio of PSU awards and RSU awards appropriately balances the incentive benefits of a performance-based equity award vehicle with the retention and stockholder anti-dilution objectives of a time-based equity award vehicle, enabling us to use our equity compensation resources efficiently. To date, the Compensation Committee has not applied a rigid formula in determining the size of the equity awards to be granted to our Named Executive Officers. Instead, the Compensation Committee has exercised its judgment as to the amount of the awards after taking into consideration a competitive market analysis prepared by its compensation consultant, the recommendations of our CEO (except with respect to his own equity award), the remaining prospective incentive and retention value of the outstanding equity holdings of each Named Executive Officer (including the current economic value of his unvested equity holdings), the projected impact of the proposed awards on our earnings, the proportion of our total shares outstanding used for annual long-term incentive compensation awards (our “burn rate”) in relation to the annual burn rate ranges of the companies in our compensation peer group and the potential voting power dilution to our stockholders in relation to the median practice of the companies in our compensation peer group, as well as the other factors described in “Compensation-Setting Process—Setting Target Total Direct Compensation” above. Based upon these factors, the Compensation Committee formulates and determines the size of each equity award it decides to grant at levels it considers appropriate to create a meaningful opportunity for reward predicated on the creation of long-term stockholder value. 2023 Annual Equity Awards In April 2023, as part of its annual review of our executive compensation program, and after taking into consideration the factors described above, the Compensation Committee determined to grant our executive officers, including our then-incumbent Named Executive Officers, Messrs. Stark and Hanson, and Mr. Keirn PSU awards and RSU awards. Further, the Compensation Committee determined that 50% of Mr. Stark’s equity award should be in the form of a PSU award with the remaining 50% of the award being the form of a RSU award, while Messrs. Hanson and Keirn received 70% of their equity award in the form of an RSU award and 30% in the form of a PSU award. One-half of the PSUs subject to the PSU awards were to be earned based on our market growth as measured over three consecutive one-year periods, while the

  35. Compensation Elements

    | Named Executive Officer | PSU Award (target number of shares) | PSU Award (grant date fair value) | RSU Award (target number of shares) | RSU Award (grant date fair value) | | Mr. Stark | 85,000 | $851,700 | 85,000 | $851,700 | | Mr. Hanson | 13,500 | $135,270 | 31,500 | $315,630 | | Mr. Keirn | 12,000 | $120,240 | 28,000 | $280,560 |

  36. Compensation Elements

    RSU Awards The RSU awards granted to our Named Executive Officers vest over a four-year period, with one-quarter of the RSUs subject to the award vesting on April 1, 2024, and the remainder of the RSUs subject to the award vesting in equal annual installments until April 1, 2027, contingent upon the applicable Named Executive Officer’s continued employment with or service to us through each applicable vesting date. The RSUs represent a contingent right to receive one share of our Common Stock for each unit that vests, or cash with a value equal to the fair market value of the underlying Common Stock, or a combination thereof. The RSU award is subject to the terms of the 2023 Plan and the applicable award agreement. 2023 Market Growth PSU Awards (50% of PSU Awards) The Market Growth PSU Awards granted to our Named Executive Officers are to be earned over three consecutive one-year performance periods, with the number of units earned varying between 0% to 200% of the target number of units granted (with the payout range scaling linearly between the measurement points) based on the calculated “earned” units as determined based on our revenue growth exceeding “market” growth for each of 2023, 2024 and 2025:

  37. Compensation Elements

    | Performance Goal for 2023, 2024 and 2025 | Percentage of Target PSUs Earned | | Market Growth -6% | 0% | | Market Growth -3% | 50% | | At Market | 80% | | Market Growth +3% | 100% | | Market Growth +6% | 200% |

  38. Compensation Elements

    For purposes of the Market Growth PSU awards, “market” is defined as NPD+GFK market sell through size for North America, the United Kingdom, France and Germany for all gaming headsets, keyboards and mice. 2023 EBITDA Margin PSU Awards (50% of PSU Awards) The EBITDA Margin PSU Awards granted to our Named Executive Officers are to be earned over three consecutive one-year performance periods, with the number of units earned varying between 0% to 200% of the target number of units granted (with the payout range scaling linearly between the measurement points) based on the calculated “earned” units as determined based on our Adjusted EBITDA as a percentage of net revenue for 2023, 2024 and 2025:

  39. Compensation Elements

    | 2023 EBITDA Percentage | 2024 EBITDA Percentage | 2025 EBITDA Percentage | Percentage of Target PSUs Earned | 2023 EBITDA Calculation 272.8 (plan revenue in millions) | | 0% | 0% | 0% | 0% | $0 | | 1.4% | 3.0% | 5.0% | 50% | $3.8 | | 2.0% | 4.5% | 6.5% | 75% | $5.5 | | 2.7% | 6.0% | 8.0% | 100% | $7.4 | | 3.4% | 7.5% | 10.0% | 125% | $9.3 | | 4.1% | 8.7% | 11.5% | 150% | $11.2 | | 5.4% | 10.0% | 13.0% | 200% | $14.7 |

  40. Compensation Elements

    | | 2023 PSU Awards: Market Growth | | 2023 PSU Awards: EBITDA Margin | | | | Named Executive Officer | Target PSUs Granted (#) | Actual PSUs Earned (#) | Target PSUs Granted (#) | Actual PSUs Earned (#) | Total PSUs Earned for 2023 Performance | | Mr. Keirn | 2,000 | 4,000 | 2,000 | 1,868 | 5,868 | | Mr. Hanson | 2,250 | 4,500 | 2,250 | 2,101 | 6,601 |

  41. Compensation Elements

    Results of 2021 and 2022 PSU Awards Tied to 2023 Performance In March 2024, the Compensation Committee reviewed and evaluated our 2023 market growth and Adjusted EBITDA for purposes of the third performance period of the 2021 PSU Awards and second performance period of the 2022 PSU Awards. The Compensation Committee determined that our actual revenue growth of 115% exceeded the maximum performance level of 110%, resulting in 200% of the target number of units subject to the 2021 and 2022 Market Growth EBITDA PSU Awards earned. We did not achieve the threshold performance level for Adjusted EBITDA to earn a payout for the 2021 and 2022 PSU awards based on our Adjusted EBITDA performance.

  42. Compensation Elements

    | | 2021 PSU Awards | | 2022 PSU Awards | | | | Named Executive Officer | Target PSUs Granted (#) | Actual PSUs Earned (#) | Target PSUs Granted (#) | Actual PSUs Earned (#) | Total PSUs Earned for 2023 Performance (#) | | Mr. Keirn | 4,000 | 4,000 | 4,666 | 4,666 | 4,666 | | Mr. Hanson | 4,000 | 4,000 | 5,334 | 5,334 | 5,334 |

  43. Other Compensation Policies

    Compensation Recoupment (“Clawback”) Policy In the event that we are required to restate our financial statements due to material non-compliance with any financial reporting requirements under the federal securities laws, our Board will take such action as it deems necessary to remedy the misconduct, prevent its recurrence, and, if appropriate based on all relevant facts and circumstances, take remedial action against any responsible employee or executive officer in a manner it deems appropriate. Under the Executive Management Compensation Recoupment and Clawback Provision of our Code of Conduct, our Board will, to the fullest extent permitted by governing law, and as our Board deems necessary and appropriate, require reimbursement of any bonus or incentive compensation awarded to an executive officer or employee or effect the cancellation of unvested restricted, deferred stock awards previously granted to the executive officer or employee if and to the extent that: (i) the amount of the bonus, incentive compensation, or stock award was calculated based upon the achievement of certain financial results that would not have been met had the financial results been properly reported, (ii) the executive officer or employee engaged in intentional misconduct that caused or partially caused the need for the restatement, and (iii) the amount of the bonus, incentive compensation, or stock award that would have been awarded to the executive officer or employee had the financial results been properly reported would have been lower than the amount actually awarded. In addition, in October 2023, the Board adopted the Turtle Beach Compensation Recoupment Policy (the “Clawback Policy”) to comply with Exchange Act Rule 10D-1 and Listing Rule 5608 of the Nasdaq Stock Market. Under the Clawback Policy, in the event that we are required to restate our financial statements we will reasonably promptly recover from an “executive officer” (as defined in the Clawback Policy) the amount of any erroneously awarded “incentive-based compensation” (as defined in the Clawback Policy) that is “received” by such executive officer during the three completed fiscal years immediately preceding the date on which we are required to restate our financial statements. The amount of erroneously awarded incentive-based compensation will be the excess of the incentive-based compensation received by the executive officer (whether in cash or in shares) based on the erroneous data in the original financial statements over the incentive-based compensation (whether in cash or in shares) that would have been received by the executive officer had such incentive-based compensation been based on the restated results. Such recovery is not dependent on fraud or misconduct by any executive officer in connection with the financial restatement. Equity Award Grant Policy The Compensation Committee has adopted a policy to facilitate compliance with applicable legal, accounting and tax requirements in connection with the grant of equity awards, including, but not limited to, stock options and RSU awards. Generally, the Compensation Committee expects annual equity awards to be granted to certain current employees in the month of April each year (the “Annual Grants”), consistent with past practice. In addition, the Compensation Committee will seek to grant all equity awards other than Annual Grants on the 16th day of the second month of each calendar quarter (a “Target Grant Date”) and will generally avoid doing so during the period starting 14 days prior to the date of the public issuance of any press release disclosing our results of operation and financial condition and ending 10 days after such date (the “Limited Period”). Notwithstanding the foregoing, if a Target Grant Date falls within a Limited Period, the applicable equity awards will still be granted on the Target Grant Date unless our General Counsel or Chief Compliance Officer determines that circumstances would render it advisable to delay the grant of the awards until after the end of the Limited Period.

  44. Risks Related to Our Compensation Policies and Practices

    | • | Performance measures (non-sales plans); |

  45. Risks Related to Our Compensation Policies and Practices

    | • | Goal setting and payout formula (non-sales plans); |

  46. Risks Related to Our Compensation Policies and Practices

    | • | Equity incentive structure and policies; |

  47. Tax and Accounting Considerations

    Tax and Accounting Considerations The Compensation Committee takes the applicable tax and accounting requirements into consideration in designing and overseeing our executive compensation program. Deductibility of Executive Compensation Under Section 162(m) of the Code, compensation paid to our “covered executive officers” (which include our CEO and CFO), and except for certain “grandfathered” arrangements, will not be deductible to the extent it exceeds $1 million. While the Compensation Committee considers the deductibility of awards as one factor in determining executive compensation, the Compensation Committee also looks at other factors in making its decisions, as noted above, and retains the flexibility to award compensation that it determines to be consistent with the goals of our executive compensation program even if the awards are not deductible by us for tax purposes. Accounting for Stock-Based Compensation The Compensation Committee takes accounting considerations into account in designing compensation plans and arrangements for our executive officers and other employees. Chief among these is Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“ASC Topic 718”), the standard which governs the accounting treatment of certain stock-based compensation. Among other things, ASC Topic 718 requires us to record a compensation expense in our income statement for all equity awards granted to our executive officers and other employees. This compensation expense is based on the grant date “fair value” of the equity award and, in most cases, will be recognized ratably over the award’s requisite service period (which, generally, will correspond to the award’s vesting schedule). This compensation expense is also reported in the compensation tables below, even though recipients may never realize any value from their equity awards.

  48. 2023 Summary Compensation Table

    2023 Summary Compensation Table

  49. 2023 Summary Compensation Table

    | Name and Principal Position | Fiscal Year | Salary $(1) | Stock Awards $(2) | Option Awards $ | Non-Equity Incentive Plan Compensation $(3) | All Other Compensation $(4) | Total ($) | | Cris Keirn(5) Interim Chief Executive Officer and SVP Global Sales | 2023 | 390,000 | 460,658 | 0 | 313,746 | 49,078 | 1,213,482 | | Juergen Stark(6) | 2023 | 331,154 | 1,703,400 | 0 | 315,000 | 4,094,028 | 6,443,582 | | Former Chief Executive | 2022 | 600,000 | 2,976,312 | 0 | 247,500 | 44,589 | 3,868,401 | | Officer, President | 2021 | 586,539 | 2,743,000 | 0 | 528,459 | 55,189 | 3,913,187 | | John T. Hanson | 2023 | 389,615 | 450,900 | 0 | 256,169 | 30,235 | 1,126,919 | | Chief Financial Officer and Treasurer | 2022 | 375,000 | 972,884 | 0 | 117,366 | 27,210 | 1,492,460 | | | 2021 | 372,308 | 932,620(7) | 0 | 203,718 | 34,944 | 1,543,590(7) |

  50. 2023 Summary Compensation Table

    | (1) Reflects total cash salary paid to each Named Executive Officer during each calendar year. |

  51. 2023 Summary Compensation Table

    | (2) Amounts shown in this column do not reflect actual compensation received by the Named Executive Officers. The “Stock Awards” column reports the grant date fair value of stock awards, which for 2023 included a PSU award and a RSU award, in accordance with the provisions of ASC 718 for awards granted during the applicable year and assume no forfeiture rate derived in the calculation of the grant date fair market value. Assumptions used in calculating the value of stock awards are included in Note 10 in the notes to our financial statements included in our most recent Annual Report on Form 10-K. As the PSU awards granted in 2023 are subject to performance conditions, the amount reported in the table above reflects the value at grant date based upon the probable outcome of such conditions as of the grant date. Assuming the maximum performance level was probable on the grant date, the grant date fair value for the PSU awards would have been $240,480 for Mr. Keirn, $1,703,400 for Mr. Stark and $270,540 for Mr. Hanson. See “Compensation Discussion & Analysis-Results of 2023 PSU Awards Tied to 2023 Performance” for year 1 vesting amounts of PSU awards granted in 2023 and “Compensation Discussion & Analysis-Results of 2021 and 2022 PSU Awards Tied to 2023 Performance” for the year 3 and year 2 vesting amounts of PSU awards granted in 2021 and 2022, respectively. |

  52. 2023 Summary Compensation Table

    | (3) Amounts reflect actual payouts under the 2023 Bonus Plan. |

  53. 2023 Summary Compensation Table

    | (4) The amounts reported in the “All Other Compensation” column include the employer portion of payments pursuant to the Company’s medical and dental plans and matching of 401(k) contributions available to all employees. “All Other Compensation” for Mr. Stark in 2023 additionally includes the following amounts under the Stark Separation Agreement: (i) salary continuation payments totaling $290,769 in 2023; (ii) a COBRA subsidy totaling $22,772 in 2023; (iii) and acceleration of his outstanding equity awards with a fair value on the date of acceleration totaling $3,733,050. |

  54. 2023 Summary Compensation Table

    | (5) Mr. Keirn began serving as the Company’s Interim CEO and SVP Global Sales on July 1, 2023 and later became the CEO on March 13, 2024. |

  55. 2023 Summary Compensation Table

    | (6) Mr. Stark served as the Company’s CEO and President until June 30, 2023. |

  56. 2023 Summary Compensation Table

    | (7) The amount of stock awards for 2021 previously reported in the Summary Compensation Table in our definitive proxy statements filed with the SEC on May 26, 2023 and May 20, 2022 was 987,480, which included a grant of 18,000 PSUs when Mr. Hanson was only awarded 16,000 PSUs in 2021. The amount of stock awards and the amount of total compensation for 2021 previously reported for Mr. Hanson has been revised to correct this mathematical error. |

  57. 2023 Summary Compensation Table

    | 2024 Proxy Statement | 48 |

  58. Grants of Plan-Based Awards Table

    Grants of Plan-Based Awards Table The following table sets forth each grant made to our Named Executive Officers in 2023 under the plans established by the Company in the amounts granted on such dates.

  59. Grants of Plan-Based Awards Table

    | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | | | Estimated Future Payouts Under Equity Incentive Plan Awards(2) | | | | | | | | Name | Grant Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | All Other Stock Awards: Number of Shares of Stock or Units (#) | All Other Option Awards: Number of Securities Underlying Options (#) | Exercise or Base Price of Option Awards ($/sh) | Grant Date Fair Value of Stock and Option Awards ($)(3) | | Cris Keirn | 4/24/2023 | 116,112 | 328,000 | 656,000 | | | | | | | | | | 4/1/2023 | | | | 6,000 | 12,000 | 24,000 | | | | $120,420 | | | 4/1/2023 | | | | | | | 28,000 | | | $280,560 | | | 7/31/2023 | | | | | | | 903 | | | $10,159 | | | 8/31/2023 | | | | | | | 887 | | | $9,642 | | | 9/29/2023 | | | | | | | 1,019 | | | $9,247 | | | 10/31/2023 | | | | | | | 1,171 | | | $9,520 | | | 11/30/2023 | | | | | | | 1,011 | | | $11,434 | | | 12/29/2023 | | | | | | | 900 | | | $9,855 | | Juergen Stark | 4/24/2023 | 236,250 | 630,000 | 1,260,000 | | | | | | | | | | 4/1/2023 | | | | 42,500 | 85,000 | 170,000 | | | | $851,700 | | | 4/1/2023 | | | | | | | 85,000 | | | $851,700 | | John T. Hanson | 4/24/2023 | 105,761 | 276,500 | 553,000 | | | | | | | | | | 4/1/2023 | | | | 6,750 | 13,500 | 27,000 | | | | $135,270 | | | 4/1/2023 | | | | | | | 31,500 | | | $315,360 |

  60. Grants of Plan-Based Awards Table

    | (1) These columns consist of the annual cash bonus opportunities for 2023 payable pursuant to the terms of the 2023 Bonus Plan. See the “Compensation Discussion & Analysis” for a description of the 2023 Bonus Plan and the “2023 Summary Compensation Table” above for the actual amounts earned and/or paid out under the 2023 Bonus Plan. |

  61. Grants of Plan-Based Awards Table

    | (2) These columns reflect the threshold, target, and maximum number of units payable under the PSU awards granted on April 1, 2023. For purposes of the threshold number of units payable under the PSU awards, the number of units was determined based on 50% of the target number of units. However, the Market Growth PSU award has a 25% threshold in the 2023 and 2024 performance years, See the “Compensation Discussion & Analysis” for a description of the performance metrics applicable to the PSU awards granted in 2023. The actual payout amounts depend on the satisfaction of the performance metrics over the applicable performance period. Grant date values are determined in accordance with ASC Topic 718. |

  62. Grants of Plan-Based Awards Table

    | (3) This column reflects the number of time-based RSUs granted to our Named Executive Officers in 2023. Grant date values are determined in accordance with ASC Topic 718. See the “Compensation Discussion & Analysis” for further discussion of the RSUs granted in 2023. |

  63. Grants of Plan-Based Awards Table

    | 49 | |

  64. 2023 Outstanding Equity Awards at Fiscal Year-End Table

    2023 Outstanding Equity Awards at Fiscal Year-End Table The following table presents information regarding all outstanding equity awards held by each of our Named Executive Officers on December 31, 2023.

  65. 2023 Outstanding Equity Awards at Fiscal Year-End Table

    | | | Option Awards | | | | Stock Awards | | | | | | Grant Date | Number of Securities Underlying Options Exercisable | Number of Securities Underlying Options Unexercisable(1) | Option Exercise Price | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested | Market Value of Shares or Units of Stock That Have Not Vested | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested | | Cris Keirn | 04/01/2019 | 19,167 | 0 | $12.10 | 4/1/2029 | | | | | | | 04/01/2020 | 8,021 | 4,584 | $5.95 | 4/1/2030 | | | | | | | 04/01/2020 | | | | | 6,875(2) | $75,281 | | | | | 04/01/2021 | | | | | 9,000(3) | $98,550 | | | | | 04/01/2022 | | | | | 15,750(4) | $172,463 | | | | | 04/01/2023 | | | | | 28,000(5) | $306,600 | | | | | 04/01/2021 | | | | | | | 1,020(6) | $11,169 | | | 04/01/2022 | | | | | | | 2,345(6) | $25,678 | | | 04/01/2023 | | | | | | | 6,000(6) | $65,700 | | | 07/31/2023 | | | | | 903(7) | $9,888 | | | | | 08/31/2023 | | | | | 887(7) | $9,713 | | | | | 09/29/2023 | | | | | 1,019(7) | $11,158 | | | | | 10/31/2023 | | | | | 1,171(7) | $12,822 | | | | | 11/30/2023 | | | | | 1,011(7) | $11,070 | | | | | 12/29/2023 | | | | | 900(7) | $9,855 | | | | Juergen Stark(8) | 05/29/2015 | 70,000 | 0 | $7.24 | 6/30/2024 | | | | | | | 04/01/2019 | 105,000 | 0 | $12.10 | 6/30/2024 | | | | | | | 04/01/2020 | 52,500 | 0 | $5.95 | 6/30/2024 | | | | | | John T. Hanson | 11/13/2017 | 2,696 | 0 | $2.04 | 11/13/2027 | | | | | | | 04/11/2018 | 29,391 | 0 | $3.12 | 4/11/2028 | | | | | | | 04/01/2019 | 14,167 | 0 | $12.10 | 4/1/2029 | | | | | | | 04/01/2020 | 28,646 | 4,584 | $5.95 | 4/1/2030 | | | | | | | 04/01/2020 | | | | | 6,875(2) | $75,281 | | | | | 04/01/2021 | | | | | 9,000(3) | $98,550 | | | | | 04/01/2022 | | | | | 18,000(4) | $197,100 | | | | | 04/01/2023 | | | | | 31,500(5) | $344,925 | | | | | 04/01/2021 | | | | | | | 1,020(6) | $11,169 | | | 04/01/2022 | | | | | | | 2,680(6) | $29,346 | | | 04/01/2023 | | | | | | | 6,750(6) | $73,913 |

  66. 2023 Outstanding Equity Awards at Fiscal Year-End Table

    | (1) Options vest with respect to 25% of the shares underlying the option on the first anniversary of the grant date and the remaining underlying shares on a monthly basis thereafter for the next 36 months. |

  67. 2023 Outstanding Equity Awards at Fiscal Year-End Table

    | (2) As of December 31, 2023, these RSU awards vest in equal annual installments until April 1, 2024. |

  68. 2023 Outstanding Equity Awards at Fiscal Year-End Table

    | (3) As of December 31, 2023, these RSU awards vest in equal annual installments until April 1, 2025. |

  69. 2023 Outstanding Equity Awards at Fiscal Year-End Table

    | (4) As of December 31, 2023, these RSU awards vest in equal annual installments until April 1, 2026. |

  70. 2023 Outstanding Equity Awards at Fiscal Year-End Table

    | (5) As of December 31, 2023, these RSU awards vest in equal annual installments until April 1, 2027. |

  71. 2023 Outstanding Equity Awards at Fiscal Year-End Table

    | 2024 Proxy Statement | 50 |

  72. 2023 Outstanding Equity Awards at Fiscal Year-End Table

    | (6) Amounts related to PSU awards granted in 2021, 2022 and 2023 are each subject to a three-year performance period, which commenced on January 1, 2021, January 1, 2022 and January 1, 2023, respectively. The amounts shown assume threshold performance is achieved and the market value is based on the closing market price of our Common Stock on December 31, 2023 ($10.95 per share). The actual payout values will depend, among other things, our actual performance through the end of the performance periods and our future stock price. |

  73. 2023 Outstanding Equity Awards at Fiscal Year-End Table

    | (7) These deferred stock awards became vested upon the termination of Mr. Keirn’s appointment as our Interim CEO because of the appointment of a permanent replacement CEO. Upon Mr. Keirn’s appointment as CEO on March 13, 2024, the awards vested in full as of that date. |

  74. 2023 Outstanding Equity Awards at Fiscal Year-End Table

    | (8) Pursuant to the Stark Separation Agreement, on May 1, 2023, the unvested portions of Mr. Stark’s outstanding equity awards immediately vested. See “Post-Employment Compensation Arrangements-Stark Separation Agreement” for more information. |

  75. 2023 Option Exercises and Stock Vested Table

    2023 Option Exercises and Stock Vested Table The following table sets forth information concerning each exercise of stock options and the vesting of restricted stock by our Named Executive Officers during 2023.

  76. 2023 Option Exercises and Stock Vested Table

    | | Option Awards | | Stock Awards | | | Name | Number of Shares Acquired on Exercise (#)(1) | Value Realized on Exercise ($)(2) | Number of Shares Acquired on Vesting (#)(3) | Value Realized on Vesting ($)(4) | | Cris Keirn | — | — | 27,765 | $288,336 | | Juergen Stark | 360,000 | $2,517,389 | 384,288 | $4,165,362 | | John T. Hanson | — | — | 28,355 | $293,984 |

  77. 2023 Option Exercises and Stock Vested Table

    | (1) Reflects options exercised during 2023. |

  78. 2023 Option Exercises and Stock Vested Table

    | (2) Amount calculated by determining the difference between the market price of the underlying options at exercise and the exercise price of the options. |

  79. 2023 Option Exercises and Stock Vested Table

    | (3) Reflects vesting and payment of PSUs and RSUs granted in 2020 – 2022. |

  80. 2023 Option Exercises and Stock Vested Table

    | (4) Amount calculated using the closing price per share of our stock on the vesting date. |

  81. CEO Pay Ratio

    CEO Pay Ratio SEC rules require us to disclose the annual total compensation of our PEO for 2023, the median of the annual total compensation of all our employees other than our PEO, as well as their ratio to each other (the “CEO Pay Ratio”). During 2023, Mr. Stark served as our President and CEO until June 30, 2023, and Mr. Keirn began serving as our Interim CEO on July 1, 2023. As permitted by SEC rules, we chose to use the annual total compensation of Mr. Keirn, who was serving as our Interim CEO on December 31, 2023, to calculate our pay ratio. For purposes of this calculation, the cash compensation received by Mr. Keirn has been annualized to represent the actual total compensation of our CEO for 2023. This calculation methodology may not be truly representative of the annual target total direct compensation for our CEO and may be higher in one or more future years. The annual total compensation for Mr. Keirn, and for the median of the annual total compensation of all employees is calculated in accordance with SEC rules applicable to the 2023 Summary Compensation Table. For 2023, these amounts were as follows:

  82. CEO Pay Ratio

    | • | Our PEO’s annual total compensation: $1,213,482 |

  83. CEO Pay Ratio

    | • | Our median compensated employee’s annual total compensation: $114,959 |

  84. CEO Pay Ratio

    | • | CEO Pay Ratio: 11 to 1 |

  85. CEO Pay Ratio

    In determining the median compensated employee based on annual total compensation paid, we chose December 31, 2023 as the determination date. As of this date, we had 252 employees, of which 223 were full-time salaried employees, with the remaining being contract employees. We annualized compensation of employees who were not employed with us for the full year. For our consistently applied compensation measure we used regular earnings paid in 2023, with compensation converted to U.S. dollars using the average exchange rate over 2023 for employees outside of the United States. In determining our median compensated employee and calculating the CEO Pay Ratio, we did not use any of the exemptions permitted under SEC rules. Once we identified our median compensated employee, we determined that employee’s actual total compensation for 2023 using the same methodology used to calculate the annual total compensation of our named executive officers for purposes of the Summary Compensation Table.

  86. CEO Pay Ratio

    | 51 | |

  87. CEO Pay Ratio

    We believe that the CEO Pay Ratio set forth above is a reasonable estimate for 2023, determined in a manner consistent with SEC rules. The SEC rules for identifying the median compensated employee and calculating the CEO Pay Ratio based on that employee’s annual total compensation permit companies to adopt a variety of methodologies, to apply certain exemptions and to make certain assumptions, adjustments, or estimates that reflect their compensation policies. Accordingly, the CEO Pay Ratio may not be comparable to the pay ratios reported by other companies, which may have used different methodologies, assumptions, adjustments, or estimates in calculating their pay ratios.

  88. Post-Employment Compensation Arrangements

    | • | immediate vesting of the unvested portion of his outstanding equity awards, including tranche three of his 2021 PSU award, tranches two and three of his 2022 PSU award and the entirety of his 2023 PSU award, with each such tranche or award accelerated for the target number of PSUs; |

  89. Potential Payments Upon Termination or Change in Control

    Potential Payments Upon Termination or Change in Control Except as otherwise provided, the following narrative and tables set forth the potential payments and the value of other benefits that would vest or otherwise accelerate vesting at, following, or in connection with a qualifying termination. For each Named Executive Officer, the payments and benefits detailed in the tables below are in addition to any payments and benefits under our plans and arrangements that are offered or provided generally to all salaried employees on a non-discriminatory basis and any accumulated vested benefits for each Named Executive Officer, including any in-the-money stock options vested as of December 31, 2023 (which are set forth in the 2023 Outstanding Equity Awards at Fiscal Year-End Table). The tables assume that employment termination and/or the change in control occurred on December 31, 2023 and a valuation of our Common Stock based on its closing market price per share on December 29, 2023 (the last trading day of 2023) of $10.95 per share. The tables also assume that each Named Executive Officer will take all action necessary or appropriate for such Named Executive Officer to receive the maximum available benefit, such as execution of a release of claims and compliance with restrictive covenants described above. A description of some elements of the plans, arrangements, and agreements covered by the following tables and which provide for payments or benefits in connection with a termination of employment or change in control are also described under “Compensation Discussion and Analysis” above. The footnotes to the tables describe the assumptions that were used in calculating the amounts described below. As described above in “Compensation Discussion and Analysis”, Mr. Stark’s employment with the Company terminated effective as of the close of business on June 30, 2023. As he incurred a termination prior to the end of the year, the amounts

  90. Potential Payments Upon Termination or Change in Control

    | 53 | |

  91. Potential Payments Upon Termination or Change in Control

    included in the table below for Mr. Stark disclose the severance payments and benefits and accelerated equity value actually paid by the Company to Mr. Stark in connection with Mr. Stark’s termination from employment with the Company.

  92. Potential Payments Upon Termination or Change in Control

    | NEO | Base Salary Continuation(1) | Bonus Continuation(2) | Benefit Continuation(3) | Deferred Stock Value(4) | Equity Awards(5)(6) | Total | | Cris Keirn(7) | | | | | | | | Qualifying Termination other than within CIC Protection Period | $410,000 | $328,000 | $31,800 | $64,506 | $— | $834,306 | | Qualifying Termination within CIC Protection Period | $410,000 | $328,000 | $31,800 | $64,506 | $954,567 | $1,788,903 | | Juergen Stark | | | | | | | | Termination effective as of June 30, 2023 | $290,769 | $315,000 | $22,772 | $— | $3,733,050 | $4,361,592 | | John T. Hanson | | | | | | | | Qualifying Termination other than within CIC Protection Period | $197,500 | $276,500 | $— | $— | $— | $474,000 | | Qualifying Termination within CIC Protection Period | $395,000 | $276,500 | $31,800 | $— | $1,048,657 | $1,751,957 |

  93. Potential Payments Upon Termination or Change in Control

    | (1) The Base Salary Continuation amounts for Mr. Keirn and Mr. Hanson assume base salary amounts in effect on December 31, 2023, payable over the severance period applicable for the Named Executive Officer. The severance periods for qualifying terminations occurring other than within the CIC Protection Period are 12 months and 6 months for Mr. Keirn and Mr. Hanson, respectively. The severance periods for qualifying terminations occurring within the CIC Protection Period are 12 months for both Mr. Keirn and Mr. Hanson. The Base Salary Continuation amount for Mr. Stark reflects the aggregate amount of Base Salary Continuation paid to Mr. Stark for the period from July 1, 2023 through December 31, 2023 based on an annual base salary amount of $630,000. The Company will continue to pay Mr. Stark Base Salary Continuation through June 30, 2024 in an aggregate amount of $339,231. |

  94. Potential Payments Upon Termination or Change in Control

    | (2) The Bonus Continuation amounts for each of Mr. Keirn and Mr. Hanson are determined based on 100% of Mr. Keirn’s and Mr. Hanson’s target bonuses as of December 31, 2023. The Bonus Continuation amount for Mr. Stark reflects the pro-rated portion of Mr. Stark’s target annual bonus for 2023, which was paid to Mr. Stark in a lump sum payment. |

  95. Potential Payments Upon Termination or Change in Control

    | (3) The Benefit Continuation amount for Mr. Keirn assumes an estimated cost of $2,650 per month, payable over the 12-month severance period for Mr. Keirn. The Benefit Continuation amount for Mr. Stark reflects the amount of the employer portion of the COBRA premium rate ($3,795) for continued participation in the Company’s group health plan for Mr. Stark and his eligible dependents for period from July 1, 2023 through December 31, 2023. The Company will continue to pay Mr. Stark Benefit Continuation through June 30, 2024 in an aggregate amount of $22,772. |

  96. Potential Payments Upon Termination or Change in Control

    | (4) The Deferred Stock Value amount for Mr. Keirn assumes that the vesting of the shares of Common Stock granted to Mr. Keirn under deferred stock awards as of December 31, 2023, which is 5,891 shares, will be accelerated as of the termination date for all qualifying terminations. The value of such shares is calculated by multiplying the number of such shares that would be subject to accelerated vesting by the price per share of our Common Stock of $10.95 on December 29, 2023. |

  97. Potential Payments Upon Termination or Change in Control

    | (5) The Equity Awards amount for Mr. Kerin and Mr. Hanson assume that the vesting of all unvested stock options, RSUs and PSUs will be accelerated as of the termination date for all qualifying terminations occurring within the CIC Protection Period. The value for stock options is calculated by multiplying the number of unvested shares that would be subject to accelerated vesting by the difference between the closing price per share of our Common Stock of $10.95 on December 29, 2023 and the exercise price of the applicable stock option. The value for RSUs and PSUs is calculated by multiplying the number of unvested shares that would be subject to accelerated vesting by the price per share of our Common Stock of $10.95 on December 29, 2023. |

  98. Potential Payments Upon Termination or Change in Control

    | (6) The Equity Award amount for Mr. Stark reflects the aggregate payout to Mr. Stark in connection with the immediate vesting of the unvested portion of Mr. Stark’s outstanding equity awards as of May 1, 2023. The value for stock options is calculated by multiplying the number of unvested shares of Common Stock subject to accelerated vesting (26,355 shares) by the difference between the closing price per share of our Common Stock of $10.98 on May 1, 2023 and the exercise price of the applicable stock option ($5.95). The value for RSUs and PSUs is calculated by multiplying the number of unvested shares subject to accelerated vesting (182,695 and 145,218, respectively) by the price per share of our Common Stock of $10.98 on May 1, 2023. |

  99. Potential Payments Upon Termination or Change in Control

    | (7) The amounts in this table for Mr. Keirn reflect payments under the Keirn Offer Letter in effect as of December 31, 2023. |

  100. Potential Payments Upon Termination or Change in Control

    | 2024 Proxy Statement | 54 |

  101. Potential Payments Upon Termination or Change in Control

    The Compensation Committee approves and administers our executive compensation program, which it designs to attract, incentivize, reward, and retain our executive officers. Our program aligns our executive officer’s pay with our stockholder interests and links pay to performance through a combination of short-term and long-term incentive compensation programs. This high utilization of incentive compensation results in higher total realized pay when our executive officers exceed the Compensation Committee-approved performance targets. Conversely, failure to achieve the approved targets results in lower realized pay, including the possibility that some awards pay zero at the end of their performance period. As required by Item 402(v) of Regulation S-K, we are providing the following information about the relationship between the compensation actually paid (as calculated under applicable SEC rules) to our CEO and other Named Executive Officers and certain aspects of our financial performance. For further information concerning our pay for performance philosophy and how the Company aligns executive compensation with performance, please refer to the “ Compensation Discussion and Analysis .” 2023

  102. Table

    | (2) The dollar amounts reported in columns (c), (e) and (g) represent the amount of “compensation actually paid” to our PEO 1 (Mr. Stark), PEO 2 (Mr. Keirn) for 2023 only and our Other NEO (Mr. Hanson) as computed in accordance with Item 402(v) of Regulation S-K for each covered fiscal year, except Mr. Stark’s 2023 compensation actually paid reflects amounts paid under the Stark Separation Agreement – please refer to “ Executive Compensation—2023 Summary Compensation Table ” for more details. The dollar amounts do not reflect the actual amount of compensation earned or received by Messrs. Stark, Keirn or Hanson during the applicable fiscal year. Figures for compensation actually paid to our PEO 1 and Other NEO from 2020—2022 are different from the executive compensation disclosure reflected in our 2023 definitive proxy statement filed with the SEC on May 26, 2023 due to inadvertent miscalculations that excluded select |

  103. Relationship Between Compensation Actually Paid and Performance Measures

    Relationship Between Compensation Actually Paid and Performance Measures The Pay Versus Performance table above and the charts below demonstrate that the compensation actually paid to our PEOs and the Other NEO was generally aligned with our performance based on the performance measures presented in the table o ver t he covered fiscal years, including TSR, net income, and adjusted EBITDA.

  104. Relationship Between Compensation Actually Paid and Performance Measures

    | 57 | |

  105. Relationship Between Compensation Actually Paid and Performance Measures

    Compensation Actually Paid and Company TSR As demonstrated in the chart below, the amount of compensation actually paid to our PEOs and the Other NEO is generally aligned with our TS R . Given the weighting of equity-based compensation in our overall pay mix for the four covered fiscal years, our TSR performance materially impacted the compensation actually paid in 2023. The chart also compares our cumulative TSR to the cumulative TSR of our selected peer group for the four covered fiscal years.

  106. Relationship Between Compensation Actually Paid and Performance Measures

    | 2024 Proxy Statement | 58 |

  107. Relationship Between Compensation Actually Paid and Performance Measures

    Compensation Actually Paid and Net Income The chart below illustrates the correlation between compensation actually paid to our PEOs and the Other NEO against the Company’s GAAP net income. Our increased 2023 net income was driven by market share gains for both the console headset gaming and simulation products, coupled with proactive expense management and lower freight costs and promotional spending. We do not use net income as a financial performance measure in our executive compensation program, but there is an indirect correlation between our profitability and compensation actually paid through the impact of adjusted EBITDA performance on pay outcomes as a measure in both our annual incentive plan and performance stock unit plan (expressed as a percentage of revenue).

  108. Relationship Between Compensation Actually Paid and Performance Measures

    | 59 | |

  109. Relationship Between Compensation Actually Paid and Performance Measures

    Compensation Actually Paid and Adjusted EBITDA The chart below compares the compensation actually paid to our PEOs and the Other NEO with our adjusted EBITDA performance, the financial performance measure that, in our assessment, represents the most important financial performance measure used by us to link compensation actually paid to our PEOs and the Other NEO for the most recently completed fiscal year, to our performance. Our compensation actually paid correlated with our adjusted EBITDA, which increased based on similar factors as noted above impacting net income, as well as restructuring expenses, CEO transition costs and additional stock-based compensation expense associated with the acceleration of vesting of the former CEO’s equity awards.

  110. Relationship Between Compensation Actually Paid and Performance Measures

    | 2024 Proxy Statement | 60 |

  111. Relationship Between Compensation Actually Paid and Performance Measures

    To attract and retain qualified non-employee directors, the Company has established a formal program providing for a mix of cash retainer fees and equity awards. Our Compensation Committee reviews this compensation program, with assistance from Compensia, on a periodic basis to ensure the program remains aligned with competitive market best practices. The following table lists compensation paid to all non-employee directors serving during 2023. Directors who are also employees of the Company receive no additional compensation for service as directors. Compensation for Mr. Stark, the former CEO, is reported in the 2023 Summary Compensation Table included in “Executive Compensation” above.

  112. 2023 Director Compensation Table

    2023 Director Compensation Table

  113. 2023 Director Compensation Table

    | Name | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(2) | Total ($) | | L. Gregory Ballard(3) | 70,208 | 92,996 | 163,204 | | Terry Jimenez(4) | 95,874 | 92,996 | 188,870 | | William E. Keitel(5) | 44,577 | 24,495 | 69,072 | | Katherine L. Scherping(6) | 77,917 | 92,996 | 170,913 | | Brian Stech(8) | 30,591 | 24,495 | 55,086 | | Julia W. Sze(9) | 65,104 | 92,996 | 158,100 | | Michelle D. Wilson(10) | 61,406 | 92,996 | 154,402 | | Andrew Wolfe, Ph.D.(11) | 72,728 | 92,996 | 165,724 | | William Wyatt(12) | 46,163 | 83,600 | 129,763 |

  114. 2023 Director Compensation Table

    | (1) Cash fees paid to our non-employee directors are described below. |

  115. 2023 Director Compensation Table

    | (2) Amounts in this column do not reflect actual compensation received by our non-employee directors. The “Stock Awards” column reports the aggregate grant date fair value of restricted stock granted to our non-employee directors during 2023 in accordance with FASB ASC Topic 718 and assume no forfeiture rate. These restricted stock awards are granted under the 2023 Plan, and the method for determining the number of shares subject to the grant is described below. |

  116. 2023 Director Compensation Table

    | (3) As of December 31, 2023, Mr. Ballard held 9,281 shares of restricted stock that were granted on April 1, 2023. |

  117. 2023 Director Compensation Table

    | (4) As of December 31, 2023, Mr. Jimenez held 9,281 shares of restricted stock that were granted on April 1, 2023. |

  118. 2023 Director Compensation Table

    | (5) Mr. Keitel was granted 9,281 shares of restricted stock on April 1, 2023, but a pro-rata amount of such grant, 2,441 shares, was accelerated after his resignation from the Board on July 6, 2023. |

  119. 2023 Director Compensation Table

    | (6) As of December 31, 2023, Ms. Scherping held 9,281 shares of restricted stock that were granted on April 1, 2023. |

  120. 2023 Director Compensation Table

    | (8) Mr. Stech was granted 9,281 shares of restricted stock on April 1, 2023, but a pro-rata amount of such grant, 2,441 shares, was accelerated after his resignation from the Board on July 6, 2023. |

  121. 2023 Director Compensation Table

    | (9) As of December 31, 2023, Ms. Sze held 9,281 shares of restricted stock that were granted on April 1, 2023. |

  122. 2023 Director Compensation Table

    | (10) As of December 31, 2023, Ms. Wilson held 9,281 shares of restricted stock that were granted on April 1, 2023. |

  123. 2023 Director Compensation Table

    | (11) As of December 31, 2023, Mr. Wolfe held 9,281 shares of restricted stock that were granted on April 1, 2023. |

  124. 2023 Director Compensation Table

    | (12) As of December 21, 2022, Mr. Wyatt held 7,295 shares of restricted stock that were granted May 8, 2023. Mr. Wyatt’s compensation was pro-rated for 2023 as he joined the Board on May 8, 2023. |

  125. 2023 Director Compensation Table

    Our non-employee directors receive a standard annual cash retainer fee, in addition to special fees for serving as a member of a Board committee or the chair of a Board committee. In July 2023, the Compensation Committee reviewed and adjusted the amounts of the Board Chair and Nominating and Governance Committee cash retainers; no changes were made to the other cash retainers. Upon establishment of a Value Enhancement Committee, which replaced the Strategic Committee, and CEO Search Committee, cash retainer amounts were approved and are in effect only during the time period that these Committees are functioning.

  126. 2023 Director Compensation Table

    | 61 | |

  127. 2023 Director Compensation Table

    | Pay Element | Jan. – June 30, 2023 | July 1 – Dec. 31, 2023 | | Annual Cash Retainer Fee (other than the Chair of the Board) | $50,000 | $50,000 | | Supplemental Annual Cash Lead Director and Committee Fees: | | | | • Chair of the Board (when not an executive of the Company) | $80,000 | $40,000 | | • Lead Independent Director | $25,000 | N/A | | • Audit Committee-Chairperson | $20,000 | $20,000 | | • Audit Committee-Other Members | $10,000 | $10,000 | | • Compensation Committee-Chairperson | $15,000 | $15,000 | | • Compensation Committee-Other Members | $7,500 | $7,500 | | • Nominating and Governance Committee-Chairperson | $10,000 | $15,000 | | • Nominating and Governance Committee-Other Members | $5,000 | $7,500 | | • Strategic Committee-Chairperson | $15,000 | N/A | | • Strategic Committee-Other Member | $7,500 | N/A | | • Value Enhancement Committee-Chairperson | N/A | $20,000 | | • Value Enhancement Committee-Member | N/A | $10,000 | | • CEO Search Committee-Chairperson | N/A | $10,000 | | • CEO Search Committee-Member | N/A | $5,000 |

  128. 2023 Director Compensation Table

    There are no Board or committee meeting attendance fees. Our non-employees directors are reimbursed by the Company for travel and expenses they incur in connection with their service on the Board and its committees. In addition to the cash fees described above, the Company intends to continue to grant certain equity awards to our non-employee directors. Upon initial election or appointment of a non-employee director to the Board, the Compensation Committee grants a pro-rated award of restricted stock equal to the annual value awarded to non-employee directors. This initial grant of restricted stock vests on the same vesting date as the last annual award for the existing directors. In addition, in 2023, each non-employee director received a grant of restricted stock having a grant date fair market value of approximately $93,000. The annual grant of restricted stock vests on the first anniversary of the grant date. We maintain stock ownership guidelines for our non-employee directors and our CEO. The ownership guidelines require each non-employee director to own shares of our Common Stock and vested awards with a value equal to three times the value of the annual cash retainer payable to a director. Our non-employee directors are required to attain such stock ownership goal no later than five years from the date the guidelines were adopted or on which they first were appointed to the Board. In addition, the total value of compensation granted to any non-employee director cannot exceed $750,000 in any calendar year, except that the limit would be increased to $1,250,000 for the calendar year during which an individual becomes a non-employee director. The total value of the compensation to a non-employee director serving as a Chair of the Board cannot exceed $1,250,000 in any calendar year.

  129. 2023 Director Compensation Table

    | 2024 Proxy Statement | 62 |

  130. 2023 Director Compensation Table

    The Company maintains a policy that the Audit Committee review certain transactions in which the Company and its directors, executive officers or their immediate family members are participants to determine whether a related person has a direct or indirect material interest. The Audit Committee is responsible for reviewing and, if appropriate, approving or ratifying any such related party transaction. This policy is included in our Audit Committee charter, and we consider it part of our conflicts of interest section of our Corporate Governance Principles and Guidelines. In determining whether to approve, disapprove or ratify a related party transaction, the Audit Committee will take into account, among other factors it deems appropriate, (1) whether the transaction is on terms no less favorable to the Company than terms that would otherwise be generally available to the Company if the transaction was entered into under the same or similar circumstances with a party unaffiliated with the Company and (2) the extent of the interest of the related party in the transaction. Except as set forth below, none of our directors are a party to any agreement or arrangement relating to compensation provided by a third party in connection with their service on the Board that would be required to be disclosed pursuant to the Nasdaq listing rules or the Exchange Act.