DEF 14A of Immersion Corp, Apr 4, 2024

DEF 14A of Immersion Corp

Filed Apr 4, 2024 · FY20230001213900-24-030401

Open on EDGAR

  1. TABLE OF CONTENTS

    | PROXY STATEMENT | 1 | | QUESTIONS AND ANSWERS | 2 | | ELECTION OF DIRECTORS (PROPOSAL 1) | 9 | | DIRECTOR COMPENSATION | 15 | | CORPORATE GOVERNANCE | 17 | | RELATED PERSON TRANSACTIONS | 25 | | OWNERSHIP OF OUR EQUITY SECURITIES | 26 | | Directors and Executive Officers | 26 | | Principal Stockholders | 27 | | Delinquent Section 16(a) Reports | 27 | | EXECUTIVE COMPENSATION | 28 | | 2023 Summary Compensation Table | 28 | | Outstanding Equity Awards at December 31, 2023 | 30 | | Potential Payments upon Termination or Change in Control | 31 | | Pay Versus Performance | 33 | | EQUITY COMPENSATION PLAN INFORMATION | 35 | | AUDIT COMMITTEE REPORT | 36 | | RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (PROPOSAL 2) | 37 | | Audit Fees and All Other Fees | 37 | | ADVISORY VOTE ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS (PROPOSAL 3) | 39 | | APPROVAL OF THE EXCULPATION AMENDENT (PROPOSAL 4) | 40 |

  2. ELECTION OF DIRECTORS (PROPOSAL 1)

    ELECTION OF DIRECTORS (PROPOSAL 1) Our Board of Directors is elected by the stockholders to oversee their interest in the long-term health and the overall success of our business and its financial strength. Our Board serves as our ultimate decision-making body, except for those matters reserved to or shared with our stockholders. Our Board selects and oversees the members of our senior management, who are charged by our Board with conducting our business.

  3. 2024 Nominees for Director

    2024 Nominees for Director Our Board’s nominees for election at the Annual Meeting are William Martin, Elias Nader, Eric Singer, Frederick Wasch and Emily Hoffman. If elected, these nominees will hold office until the 2025 Annual Meeting of Stockholders and until such person’s successor is elected and qualified. We have no reason to believe that the nominees listed above will be unable or unwilling to serve if elected. However, if any of these nominees should become unable for any reason or unwilling for good cause to serve, proxies may be voted for another person nominated as a substitute by the Board, or the Board may reduce the number of directors. The Board believes that the nominees’ qualifications, skills and experiences would contribute to an effective and well-functioning Board. Included in each nominee’s biography below is an assessment of his or her specific qualifications, attributes, skills, and experience based on the qualifications described above. There are no family relationships between the nominees, any directors, or any of our executive officers.

  4. Nominees for Directors – To Be Elected for a Term Expiring in 2025

    Nominees for Directors – To Be Elected for a Term Expiring in 2025

  5. William Martin

    William Martin Director since: 2019 Age: 46 Professional Experience: William C. Martin joined our Board in August 2019 and has served as our Chief Strategy Officer since December 2021. Mr. Martin has extensive experience as a board member, investor, and entrepreneur. He previously ran a private investment fund for Raging Capital Management from 2006 to 2020 that is currently being wound down. As an entrepreneur, he co-founded a number of financial information companies, including Raging Bull in 1997 and InsiderScore in 2004. Mr. Martin has served on numerous public company boards, including nine years on the board of Bankrate, Inc., a consumer finance company, which was acquired in 2009; the board of Salary.com, Inc., a compensation data and software company, which was acquired in 2010; and the board of Vitesse Semiconductor Corp., a semiconductor company, which was acquired in 2015. Mr. Martin also manages his personal family office, Raging Capital Ventures. Director Qualifications: Mr. Martin's extensive experience and successful track record as an investor, entrepreneur and public company director enables him to provide the Board and management with valuable perspectives on our operations, capital allocation strategies and other corporate strategies to maximize stockholder value. Mr. Martin also managed Raging Capital Management, LLC, which was previously one of our largest stockholders, and has a long track record of investing in publicly traded companies and actively engaging in certain investments. As a result, Mr. Martin brings the perspective of a stockholder to our Board that is critical in creating and implementing strategies that increase stockholder value.

  6. Elias Nader

    Elias Nader Director since: 2022 and Lead Independent Director since January 2023 Age: 59 Education: Mr. Nader has Bachelor of Science Degree in Accounting, Bachelor of Arts Degree in Economics and an MBA in International Business from San Jose State University. Professional Experience: Mr. Nader has served as the Chief Financial Officer and Senior Vice President of Finance of QuickLogic Corporation (Nasdaq: QUIK), a publicly traded fabless semiconductor company, since February 1, 2023. Prior to that, Mr. Nader served as Chief Financial Officer and Senior Vice President of Pixelworks, Inc. (Nasdaq: PXLW), a publicly traded video processing semiconductor company, from September 2019 to January 2023. Prior to that, Mr. Nader served as the Interim President and Chief Executive Officer of Sigma Designs, Inc., a publicly traded semiconductor company that designed solutions for home connectivity, IPTV, HDTV and media processors, from January 2018 to September 2019, and as Sigma’s Chief Financial Officer from April 2014 to January 2023. Director Qualifications: Mr. Nader’s extensive financial and management experience with publicly traded companies that are similarly situated to us, which enables him to contribute significantly to our Board in the area of finance and accounting. Director since: 2020, Executive Chairman from August 2020 to January 2023, and Chairman of the Board since January 2023 Education: Mr. Singer has a B.A. from Brandeis University in 1995 Professional Experience: Mr. Singer has served as a member of our Board since March 2020, as our Executive Chairman from August 2020 to January 2023, and as our Chairman of the Board since January 2023. Since December 2023, Mr. Singer has served as a director of Universal Electronics, a global leader in wireless universal control solutions for home entertainment and smart home devices. Since July 2019, Mr. Singer has served as a director of A10 Networks, Inc. (NYSE: ATEN), an application controller and firewall cloud security company, and has served as its lead independent director since September 2021. Mr. Singer was a founder and Managing Member of VIEX Capital Advisors, a securities investment firm. In addition to a long track record as a successful investor in technology companies, Mr. Singer has substantial experience serving on public boards and in assisting them in creating and expanding shareholder value. Mr. Singer previously served on the boards of directors of Quantum Corporation, a video data storage and management company, Numerex Corp., a provider of managed machine-to-machine enterprise solutions enabling the Internet of Things, RhythmOne plc and YuMe, Inc., each a provider of brand video advertising software and audience data, Support.com, Inc., a provider of tech support and support center services, Meru Networks, Inc., a Wi-Fi network solutions company, PLX Technology, Inc., a PCI Express and ethernet semiconductor company, and Sigma Designs, Inc., an integrated circuit provider for the home entertainment market, among other companies. Director Qualifications: Mr. Singer has specific attributes that qualify him to serve as a member of our Board, including his extensive financial and operating experience and knowledge of the technology industry gained through his service on numerous public company boards. Mr. Singer also managed VIEX Capital Advisors, which was previously one of our largest stockholders and has a long track record of investing in publicly traded companies and actively engaging with certain investments. As a result, Mr. Singer brings the perspective of a stockholder to our Board that is critical in creating and implementing strategies that increase stockholder value.

  7. Frederick Wasch

    Frederick Wasch Director since: 2021 Age: 53 Education: Mr. Wasch has a B.A. from Princeton University and an MBA from Columbia Business School. Professional Experience: Mr. Wasch has more than 25 years of experience in organizational development, executive leadership, and finance. In 2020, Mr. Wasch co-founded Energy Transition Capital, a renewable energy private equity firm where he currently serves as an Advisor. Mr. Wasch also serves as Managing Partner, Chief Financial Officer, Chief Operating Officer, and Chief Compliance Officer of Raging Capital Management, LLC, a long/short equity hedge fund with a peak AUM of over $900MM since 2011, where he leads the firm’s financial, operational, compliance, and organizational functions. Mr. Wasch currently manages the fund in its process of winding down. In 2024, Mr. Wasch became a partner in AWJ Fund Transition and Liquidity Services, a division of A.W. Jones, which will assist other funds in liquidating and winding-down their operations. Mr. Wasch is active in the alternatives COO/CFO community and is a regular speaker at industry conferences and events. Earlier in his career, Mr. Wasch co-founded CallStreet, a corporate events calendar and transcript business, where he led fundraising efforts, built and maintained the company’s accounting, tax and audit controls, and spearheaded new business development opportunities. The founders successfully sold the company in the mid-2000s to FactSet Research Systems, Inc. Mr. Wasch started his career in the venture capital group at Hambrecht & Quist, where he focused on companies in software, communications, and the Internet. He was active in sourcing, evaluating, and executing on new investment opportunities and served on the boards of several portfolio companies in the enterprise software and hardware industries. Director Qualifications: Mr. Wasch brings to the Board more than 25 years of experience in organizational development, executive leadership, and finance, which enables him to contribute significantly to our Board in the areas of finance, accounting, and business operations.

  8. DIRECTOR COMPENSATION

    DIRECTOR COMPENSATION The Compensation Committee is responsible for reviewing and making recommendations to the Board regarding all matters pertaining to compensation paid to directors for Board, committee and committee chair services. Directors who also serve as our employees do not receive cash fees for services as directors, but remain eligible to receive equity awards as discussed below.

  9. 2023 Director Compensation Table

    2023 Director Compensation Table The following table sets forth our director compensation for 2023 to each director who served as a director during the year ended December 31, 2023. The equity compensation paid to Mr. Singer, our current President, Chief Executive Officer and Chairman of the Board, and Mr. Martin, our Chief Strategy Officer, in connection with their service as directors, are presented below in “Executive Compensation — Summary Compensation Table” and the related equity tables.

  10. 2023 Director Compensation Table

    | Director | Fees Earned or Paid in Cash(1) ($) | Stock Awards (2)(3) ($) | All Other Compensation (4) ($) | Total ($) | | Frederick Wasch | 75,000 | 125,007 | 4,325 | 204,332 | | Sumit Agarwal (5) | 37,500 | - | 2,971 | 40,471 | | Elias Nader | 75,000 | 125,007 | 4,877 | 204,884 | | Emily Hoffman | 37,500 | 125,007 | 1,354 | 163,861 |

  11. 2023 Director Compensation Table

    | (1) Consists of cash fees that were paid in 2023 including amounts paid in 2023 for amounts earned in Q4 2022. See “2023 Annual Compensation-Cash Compensation” above for more information. | | (2) Represents the grant date fair value of each stock award granted for 2023 in accordance with Financial Accounting Standard Board’s Accounting Standards Codification Topic 718 (FASB ASC Topic 718), disregarding for this purpose the estimate of forfeitures related to service-based vesting conditions. For a discussion of assumptions used to calculate the FASB ASC Topic 718 grant date fair value, refer to Note 6 (Stock-based Compensation) to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. | | (3) Consists of amounts paid to directors for quarterly dividends on the Company’s common stock. | | (4) On March 30, 2023, Messrs. Singer, Martin, Wasch, and Nader and Ms. Hoffman were each granted RSAs covering 15,043 shares of our common stock. The RSA grants vested on the one-year anniversary of our 2023 Annual Meeting of Stockholders. The awards granted to Messrs. Singer and Martin are reflected below in “Executive Compensation — Summary Compensation Table” and the related equity tables. | | (5) Mr. Agrawal ceased to be a member of our Board on March 30, 2023, the date of our 2023 Annual Meeting of Stockholders. |

  12. Directors and Executive Officers

    Directors and Executive Officers The following table sets forth information regarding beneficial ownership of Immersion Corporation common stock by each director, each director nominee, each individual named in the 2023 Summary Compensation Table on page 28, and our directors, director nominees and executive officers as a group, all as of March 20, 2024. Unless otherwise noted, voting power and investment power in Immersion Corporation common stock are held solely by the named person. The address of each of the individuals named below is c/o Immersion Corporation, 2999 N.E. 191st Street, Suite 610, Aventura, FL 33180.

  13. Directors and Executive Officers

    | Name | Aggregate Number of Shares of Common Stock Beneficially Owned | Percent of Outstanding Shares of Common Stock** | | Eric Singer(1) | 743,425 | 2.3% | | William Martin(2) | 859,691 | 2.7% | | Elias Nader(3) | 29,266 | *% | | Frederick Wasch(4) | 47,701 | *% | | Emily S. Hoffman(5) | 58,043 | *% | | J. Michael Dodson | - | *% | | Francis Jose(6) | 28,032 | *% | | Aaron Akerman(7) | 47,078 | *% | | All directors, director nominees and executive officers as a group (6 persons) | 1,738,126 | 5.5% |

  14. Directors and Executive Officers

    | * Less than 1% of issued and outstanding shares of Immersion Corporation common stock. | | ** Based on 31,700,667 issued and outstanding shares of Immersion Corporation common stock as of March 20, 2024. |

  15. Directors and Executive Officers

    | (1) Consists of (i) 632,549 shares of common stock, (ii) 15,043 RSAs subject to vesting within 60 days of March 20, 2024, and (iii) 95,833 RSUs subject to release within 60 days of March 20, 2024. | | (2) Consists of (i) 819,648 shares of common stock, (ii) 15,043 RSAs subject to vesting within 60 days of March 20, 2024, and (iii) 25,000 RSUs subject to release within 60 days of March 20, 2024. | | (3) Consists of (i) 27,223 shares of common stock, (ii) 15,043 RSAs subject to vesting within 60 days of March 20, 2024. | | (4) Consists of (i) 32,658 shares of common stock, (ii) 15,043 RSAs subject to vesting within 60 days March 20, 2024. | | (5) Consists of (i) 43,000 shares of common stock, (ii) 15,043 RSAs subject to vesting within 60 days of March 20, 2024. | | (6) Mr. Jose resigned as the Company’s General Counsel as of March 10, 2023. As of March 10, 2023, the date of Mr. Jose’s cessation of employment, Mr. Jose beneficially owned 28,032 shares of common stock. We do not have information as to Mr. Jose’s current share ownership. | | (7) Mr. Akerman resigned as the Company’s Chief Financial Officer as of June 12, 2023. As of August 11, 2023, the date of Mr. Akerman’s cessation of employment, Mr. Akerman beneficially owned 47,078 shares of common stock. We do not have information as to Mr. Akerman’s current share ownership. |

  16. 2023 Summary Compensation Table

    2023 Summary Compensation Table Our named executive officers (“NEOs”) for fiscal 2023 were as follows:

  17. 2023 Summary Compensation Table

    | Name | Title | | Eric Singer | President, Chief Executive Officer, and Chairman of the Board | | William Martin | Chief Strategy Officer | | J. Michael Dodson(1) | Chief Financial Officer | | Francis Jose(2) | Former Chief Executive Officer and General Counsel | | Aaron Akerman(3) | Former Chief Financial Officer |

  18. 2023 Summary Compensation Table

    | (1) Mr. Dodson was appointed Chief Financial Officer of the Company, effective June 12, 2023. | | (2) Mr. Jose stepped down from the position of Chief Executive Officer on January 3, 2023, and retired from the Company on March 30, 2023. | | (3) Mr. Akerman stepped down from the position of Chief Financial Officer, effective June 12, 2023. |

  19. 2023 Summary Compensation Table

    The following table sets forth information concerning the compensation earned during the years ended December 31, 2022 and 2023 by our NEOs for 2023.

  20. 2023 Summary Compensation Table

    | Name and Principal Position | Fiscal Year | Salary ($) | Bonus (1)(2) ($) | Stock Awards(3) ($) | Option Awards $ | Non-Equity Incentive Plan Compensation(1) ($) | All Other Compensation ($)(4) | Total ($) | | Eric Singer(5) President, Chief Executive Officer and Chairman | 2023 | 898,350 | 1,347,525 | 125,007 | — | 1,347,525 | 184,414 | 3,902,822 | | | 2022 | 553,100 | 276,222 | 5,552,997 | — | 552,443 | — | 6,934,762 | | William Martin Chief Strategy Officer | 2023 | 350,000 | 525,000(6) | 125,007 | — | 525,000(6) | 100,825 | 1,625,832 | | | 2022 | 350,000 | 175,000(6) | 2,772,907 | — | 350,000(6) | — | 3,647,907 | | J. Michael Dodson(7) Chief Financial Officer | 2023 | 194,658 | 43,376 | 388,000 | — | — | 3,000 | 629,034 | | Francis Jose(5) Former Chief Executive Officer and General Counsel | 2023 | 97,977 | — | — | — | —(8) | 75,453 | 173,429 | | | 2022 | 366,078 | — | — | — | 189,750(8) | — | 555,828 | | Aaron Akerman(9) Former Chief Financial Officer | 2023 | 180,752 | 83,499 | — | — | — | 161,108 | 425,359 | | | 2022 | 250,461 | 3,080 | — | — | 45,506 | — | 299,047 |

  21. 2023 Summary Compensation Table

    | (1) Form Messrs. Singer and Martin, consists of bonus awards under our 2022 Annual Bonus Plan and 2023 Annual Bonus Plan, including discretionary bonuses awarded above target for Messrs. Singer and Martin. Pursuant to the 2023 Annual Bonus Plan, Mr. Singer was eligible to earn cash bonuses of up to 100% of his base salary, and Mr. Martin was eligible to earn cash bonuses of up to 100% of his base salary. Our Compensation Committee subsequently approved an additional 100% payout of the bonus amounts to Messrs. Singer and Martin, such that each of their total bonus payout for 2023 would be 200% of their respective base salary earned in 2023. | | (2) For Mr. Dodson, consists of a sign on bonus for Mr. Dodson’s commencement of employment with the Company. | | (3) The amounts in this column represent the aggregate grant date fair value of the awards, computed in accordance with FASB ASC Topic 718. See Note 6 of the notes to our consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2023 for a discussion of our assumptions in determining the FASB ASC Topic 718 values. | | (4) Consists of (a) contributions made by the Company under the Immersion Corporation 401K Plan for Messrs. Singer and Dodson, (b) payments of quarterly dividends and (c) benefits paid to Messrs. Akerman and Jose in connection with their departures from the Company. | | (5) Mr. Singer was appointed President, Chief Executive Officer and Chairman of the Board effective as of January 3, 2023. Mr. Jose ceased to be Chief Executive Officer and stepped down from his role at the Company on March 30, 2023. | | (6) Mr. Martin elected to receive his annual bonus in the form of shares of our common stock in 2022 and 2023. 74,160 and 44,301 shares of our common stock were issued to Mr. Martin in lieu of bonus earned during 2022 and 2023, respectively. | | (7) In June 2023, Mr. Dodson was appointed the Chief Financial Officer of the Company. | | (8) Represents amount payable to Mr. Jose under terms of the Company’s 2022 Annual Bonus Plan. Mr. Jose elected to waive receipt of his 2022 annual bonus. | | (9) In June 2023, Mr. Akerman stepped down from his role as Chief Financial Officer of the Company. Amounts paid in Canadian dollars have been converted to U.S. dollars using the average daily exchange rate from January 1, 2022 to December 31, 2023 of approximately CAD $1 to USD $0.74. |

  22. Outstanding Equity Awards at December 31, 2023

    Outstanding Equity Awards at December 31, 2023 The following table sets forth information concerning the outstanding equity awards held as of December 31, 2023 by our named executive officers:

  23. Outstanding Equity Awards at December 31, 2023

    | | | Option Awards(1) | | | | Stock Awards | | | | | Number of Securities Underlying Unexercised Options | | Option Exercise Price ($/sh) | Option Expiration Date | Number of Shares or Units of Stock that Have Not Vested (#) | (2) (7) Market Value of Shares or Units of Stock that Have Not Vested($) | | | Grant Date | Exerciseable (#) | Unexerciseable (#) | | | | | | Eric Singer | 1/27/2022 | | | | | 125,000(3) | $882,500 | | | 1/27/2022 | | | | | 200,000(5) (6) | $1,412,000 | | | 12/29/2022 | | | | | 350,998 | $2,478,046 | | | 03/30/2023 | | | | | 15,043(2) | $106,204 | | William Martin | 01/27/2022 | | | | | 125,000(3) | $882,500 | | | 01/27/2022 | | | | | 200,000(5) (6) | $1,412,000 | | | 3/30/2020 | | | | | 15,043(2) | $106,204 | | J. Michael Dodson | 6/13/2023 | | | | | 50,000(4) | $353,000 | | Francis Jose | — | | | | | — | — | | Aaron Akerman | — | | | | | — | — |

  24. Outstanding Equity Awards at December 31, 2023

    | (1) Except as otherwise indicated, options vest as to 25% of the shares on the one-year anniversary of the grant date and the remaining vest at a rate of 1/36th of the shares monthly thereafter, subject to continued service through each vesting date. | | (2) RSA awards granted to Mr. Singer and Mr. Martin in their capacity as directors are included. | | (3) Based on the closing price of our common stock of $7.03 per share on The Nasdaq Global Market on December 29, 2023. | | (4) These RSUs vest in three equal installments on each of the first three anniversaries of the date of grant, subject to continued service through each vesting date. | | (5) These PSUs are subject to stock-price performance-based milestones tied to stock price performance. Any PSUs for which the performance condition is met, are eligible to vest subject to continued employment with the Company through the applicable vesting dates, with 25% of the shares vesting on the later of one-year anniversary of the grant date and achievement of the milestone, and the remaining shares vesting in equal installments each quarterly anniversary thereafter. In March 2023, the Compensation Committee certified that the first stock price target of $7.50 in terms of the 100-day VWAP condition had been met resulting in 100,000 PSUs being earned. Vesting of the shares eligible to vest is subject to continued employment with the Company through the applicable vesting dates, with 25% of the shares vesting on the one-year anniversary of the grant date and the remaining shares vesting in equal installments each quarterly anniversary thereafter. | | (6) The amounts in this column represent the aggregate grant date fair value of the awards, computed in accordance with FASB ASC Topic 718. See Note 6 of the notes to our consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2023 for a discussion of our assumptions in determining the FASB ASC Topic 718 values. |

  25. Potential Payments upon Termination or Change in Control

    Potential Payments upon Termination or Change in Control We entered into the following agreements with each of Messrs. Singer, Martin and Dodson that provide for severance and additional benefits in connection with termination or change in control:

  26. Pay Versus Performance

    Pay Versus Performance As required by Item 402(v) of Regulation S-K, we are providing the following information about the relationship between executive compensation actually paid and certain financial performance of the Company for each of the last three completed calendar years. In determining the “compensation actually paid” to our NEOs, we are required to make various adjustments to amounts that have been previously reported in the Summary Compensation Table in previous years, as the SEC’s valuation methods for this section differ from those required in the Summary Compensation Table. The table below summarizes compensation values both previously reported in our Summary Compensation Table, as well as the adjusted values required in this section for the 2021, 2022 and 2023 calendar years. Note that for our NEOs other than our principal executive officer (the PEO), compensation is reported as an average. The following table sets forth information concerning the compensation of our NEOs for each of the fiscal years ended December 31, 2021, 2022 and 2023, and our financial performance for each such fiscal year:

  27. Pay Versus Performance

    | | Eric Singer | | Jared Smith | | Francis Jose | | | | | | | Year(1) | Summary Compensation Table (SCT) Total for PEO | Compensation Actually Paid (CAP) to PEO(2) | SCT Total for PEO | CAP to PEO (2) | SCT Total for PEO | CAP to PEO | Average SCT Total for Non-PEO NEOs(2) | Average CAP to Non-PEO NEO (2) | Value of Initial Fixed $100 Investment Based On Total Shareholder Return (TSR) | Net Income (millions) | | 2023 | $3,902,822 | $2,644,047 | N/A | N/A | $173,429 | $175,902 | $878,950 | $462,923 | $62.75 | $33.98 | | 2022 | N/A | N/A | N/A | N/A | $555,828 | $552,769 | $3,627,239 | $3,956,500 | $62.27 | $30.66 | | 2021 | N/A | N/A | $236,481 | $(810,171) | $397,327 | $239,316 | $484,598 | $96,988 | $50.58 | $12.48 |

  28. Pay Versus Performance

    | (1) During 2023, our Chief Executive Officer (PEO) was Eric Singer beginning on January 3, 2023 and Francis Jose through January 3, 2023. During 2021, our Interim Chief Executive Officer was Jared Smith through August 29, 2021, and Mr. Jose was appointed as our Chief Executive Officer effective as of August 30, 2021. The non-PEO NEOs in the 2023 reporting year were Aaron Akerman, Michael Dodson and William Martin. The non-PEO NEOs in the 2022 reporting year were Eric Singer, Aaron Akerman, and William Martin. The non-PEO NEOs in the 2021 reporting year were Eric Singer, Aaron Akerman and Michael Okada. | | (2) In order to calculate the average compensation “actually paid" (CAP) to our NEOs, we are required under the SEC rules to subtract from the value in the summary compensation table (SCT) the grant date fair value of equity awards (reflected in columns B and D below), and add back the following (reflected in columns C and E below): (i) the year-end fair value of any equity awards in the applicable year that are outstanding and unvested as of the end of the year; (ii) the amount of change as of the end of the applicable year (from the end of the prior fiscal year) in fair value of any awards granted in prior years that are outstanding and unvested as of the end of the applicable year; (iii) for awards that are granted and vest in the same applicable year, the fair value as of the vesting date; (iv) for awards granted in prior years that vest in the applicable year, the amount equal to the change as of the vesting date (from the end of the prior fiscal year) in fair value; (v) for awards granted in prior years that are determined to fail to meet the applicable vesting conditions during the applicable year, a deduction for the amount equal to the fair value at the end of the prior fiscal year; and (vi) the dollar value of any dividends or other earnings paid on stock or option awards in the applicable year prior to the vesting date that are not otherwise reflected in the fair value of such award or included in any other component of total compensation for the applicable year. |

  29. Pay Versus Performance

    | | SCT Total | Stock Awards Deducted | Stock Awards Added(a) | Options Deducted(b) | Options Added(b) | Total CAP | | | A | B | C | D | E | A – (B + D) + (C + E) | | PEO | | | | | | | | 2023 (Singer) | $3,902,822 | $1,537,007 | $278,233 | -- | -- | $2,644,047 | | 2023(Jose) | $173,429 | -- | $2,473 | -- | -- | $175,902 | | 2022 | $555,828 | -- | $(3,059) | -- | -- | $552,769 | | 2021 (Jose) | $397,327 | | $(158,011) | -- | -- | $239,316 | | 2021 (Smith) | $236,847 | | $(810,171) | --- | $27,072 | $(546,251) | | Average Non-PEO NEOs | | | | | | | | 2023 | $893,408 | $641,669 | $211,184 | -- | -- | $462,923 | | 2022 | $3,627,239 | $2,775,301 | $3,207,819 | -- | $(103,257) | $3,956,500 | | 2021 | $484,598 | -- | $(438,000) | -- | $50,390 | $96,988 |

  30. Pay Versus Performance

    | (a) The fair value of performance-vested RSUs granted in 2022 to Messrs. Singer and Martin included in columns (B) and (C), reflect the same fair value as of the grant date and as of December 31, 2022 because the company determined that there had been no change in the probability of achievement. | | (b) The fair value of stock options reported for CAP purposes in columns (D) and (E) is estimated using a Black-Scholes option pricing model in accordance with the SEC rules. This model uses both historical data and current market data to estimate the fair value of options and requires several assumptions. |

  31. Pay Versus Performance

    As shown in the table above, turnover in our NEOs from year to year can have a material impact on the reported value of compensation “actually paid,” because the fair value of forfeited equity awards (measured as of the end of the year prior to the year of forfeiture) are reflected as a negative value in columns C and E of the table contained in footnote 2 to the Pay Versus Performance table. In addition, changes in the market price of our common stock following the date of grant of an award can significantly impact the level of compensation that is actually paid to our NEOs. To assist in understanding the changes to the equity awards reflected above, the following table reflects the value of one share of our common stock as of each of the following dates. If that date reflects a non-business day, the value reported is the last trading date of the applicable calendar year:

  32. Pay Versus Performance

    | | 12/29/2023 | 12/30/2022 | 12/31/2021 | 12/31/2020 | | Closing price of our common stock | $7.06 | $7.03 | $5.71 | $11.29 |