DEF 14A of MediaAlpha, Inc., Apr 3, 2024

DEF 14A of MediaAlpha, Inc.

Filed Apr 3, 2024 · FY20230001818383-24-000028

Open on EDGAR

  1. PROPOSAL 1: ELECTION OF DIRECTORS

    PROPOSAL 1: ELECTION OF DIRECTORS Our Board consists of up to ten directors, excluding any directors elected by holders of any preferred stock pursuant to provisions applicable in the case of defaults and subject to applicable laws and stock exchange regulations. The exact number of directors will be fixed from time to time by resolution of the Board. The size of our Board is currently fixed at nine members, divided into three classes, and our Board is currently comprised of eight members, with one vacancy in Class II. The current term of office of our Class I Directors expires at the Annual Meeting, while the term for our Class II Directors expires at the 2025 annual meeting and the term for our Class III Directors expires at the 2026 annual meeting. There is no limit on the number of terms a director may serve on our Board. Pursuant to our stockholders’ agreement with White Mountains, Insignia and the Founders, for so long as each of White Mountains, Insignia and the Founders owns at least 7,338,148 shares of our common stock, which is equal to 12.5% of our issued and outstanding shares of common stock as of the closing of our initial public offering (the “IPO”), such stockholder will be entitled to nominate two directors to serve on our Board. When such stockholder owns a number of shares of our common stock equal to less than 7,338,148 shares, but at least 2,935,259 shares (5% of our issued and outstanding shares of common stock as of the closing of the IPO), such stockholder will be entitled to nominate one director. In March 2024, Insignia’s ownership of the Company’s Common Stock fell below the ownership threshold described above, and accordingly, as required by the stockholders’ agreement, Insignia caused David Lowe, who was one of Insignia’s two designees to the Board, to tender his resignation as a member of the Board. Following such resignation, pursuant to the stockholders' agreement, White Mountains has designated Christopher Delehanty and Jennifer Moyer, Insignia has designated Anthony Broglio, and the Founders have designated Eugene Nonko and Steven Yi. White Mountains, Insignia and the Founders have also agreed in the stockholders’ agreement to vote for each other’s Board nominees.

  2. Other Continuing Directors

    Other Continuing Directors The following directors will continue to serve on our Board after the Annual Meeting:

  3. Other Continuing Directors

    | Name | Principal Occupation | Age | Class | Term Expires | Director Since | | Venmal (Raji) Arasu | Chief Technology Officer, Autodesk | 54 | III | 2026 | 2020 | | Jennifer Moyer | Chief Administrative Officer, White Mountains Capital | 53 | II | 2025 | 2020 | | Lara Sweet | Former Chief People Officer, Snap, Inc. | 49 | III | 2026 | 2020 | | Kathy Vrabeck | Chief Operating Officer, The Beachbody Company | 60 | III | 2026 | 2020 | | Steven Yi | Chief Executive Officer, MediaAlpha, Inc. | 53 | II | 2025 | 2020 |

  4. Other Continuing Directors

    Venmal (Raji) Arasu was appointed director of the Company upon the completion of the IPO. Since April 2021, Ms. Arasu has served as Executive Vice President and Chief Technology Officer of Autodesk, Inc., a leader in 3D design, engineering, and entertainment software and services. From January 2016 to April 2021, Ms. Arasu was Senior Vice President, Intuit Platform of Intuit Inc., a business and financial software company that develops and sells financial, accounting, tax preparation software, and related services for small businesses, accountants, and individuals. Ms. Arasu previously served as the Chief Technology Officer for StubHub, Inc., the online and mobile ticketing marketplace subsidiary of eBay Inc., from November 2011 to January 2016. At eBay, she served as the Vice President of Engineering from 2008 to 2011, and in other positions of increasing authority from 2001 to 2008. She has served as one of NIC Inc.’s directors since 2015. Ms. Arasu holds a B.S. in Computer Engineering from Pune University, Pune, India. Ms. Arasu is qualified to serve on the Board of Directors because of her engineering expertise and her technology, business strategy and management experience. Jennifer Moyer was appointed director of the Company upon the completion of the IPO and serves as the chair of the Nominating and Corporate Governance Committee. Ms. Moyer has been the Chief Administrative Officer of White Mountains, a financial services holding company, since 2017. White Mountains has owned a stake in QL Holdings LLC since 2014 and is a stockholder of the Company. Prior to joining White Mountains, Ms. Moyer worked at Goldman Sachs for 23 years in a variety of leadership roles including Chief of Staff for Asia Pacific Ex-Japan and Managing Director in Human Capital Management for Asia Pacific. Ms. Moyer received a B.A. in Social Anthropology from Harvard College and an M.B.A. from the Tuck School of Business at Dartmouth. Ms. Moyer is qualified to serve on our Board of Directors because of her experience as a senior executive with management expertise, as well as her human capital management and corporate governance experience. Lara Sweet was appointed director of the Company upon the completion of the IPO and serves as the chair of the Audit Committee. From May 2019 to June 2021, Ms. Sweet served as the Chief People Officer at Snap Inc., a camera company and owner of the application Snapchat. Prior to that, Ms. Sweet served as Snap’s interim Chief Financial Officer from January 2019 to May 2019, as Chief Accounting Officer from October 2017 to September 2019, and as Controller from June 2016 to October 2017. Prior to Snap, Ms. Sweet worked at AOL, Inc. for over six years, most recently serving as Controller and Chief Accounting Officer from November 2014 to June 2016. Prior to that, Ms. Sweet served as AOL’s Vice President, Internal Audit from April 2014 to November 2014 and Vice President and Assistant Controller from August 2011 to April 2014. Ms. Sweet holds a B.S. in Accounting from George Mason University. Ms. Sweet is qualified to serve on our Board of Directors because of her financial expertise and management experience. Kathy Vrabeck was appointed director of the Company upon the completion of the IPO and serves as the chair of our Board of Directors as well as the chair of the Compensation Committee. Since May 2022, Ms. Vrabeck has served as Chief Operating Officer of The Beachbody Company, a leading health and wellness solutions company, and from April 2021 to May 2022, she was Chief Strategy Officer at The Beachbody Company. Prior to that, from October 2015 to April 2021, Ms. Vrabeck was a Senior Client Partner in the Los Angeles office of Korn Ferry, a global talent and organizational advisory firm, where she led Korn Ferry’s Consumer Digital sector. Prior to that, she was a Partner at Heidrick & Struggles International, Inc., an executive search firm, where she served as both Global Sector Leader of their Media, Entertainment and Digital practice and partner-in-charge of the Los Angeles office. Prior to that, Ms. Vrabeck was with Legendary Entertainment, a media company, from March 2009 to March 2011 where she served as President, Legendary Digital and was responsible for the creation, management and delivery of digital entertainment, with a focus on video games, across current and next-generation platforms. From May 2007 to November 2008, Ms. Vrabeck was with Electronic Arts, Inc., a developer, marketer, publisher and distributor of video games (“EA”), where she served as President, EA Casual Entertainment. Ms. Vrabeck received a bachelor’s degree in French and economics from DePauw University and an M.B.A. from Indiana University. Ms. Vrabeck is qualified to serve on our Board of Directors because of her expertise in digital media and her management and board experience. Steven Yi has served as the Chief Executive Officer of the Company (including its predecessor) since June 2011. Prior to joining the Company, Mr. Yi co-founded and served as the Chief Executive Officer of Fareloop LLC, a travel comparison website, from 2009 to 2011, and served as Senior Vice President and General Manager, Marketing Services, at Oversee.net, a technology-driven media company that owned and operated a portfolio of consumer and business-to-business properties, from 2007 to 2009. Mr. Yi received his undergraduate degree in East Asian Studies from Harvard University and his J.D. from Harvard Law School.

  5. Director Compensation for Fiscal Year 2023

    Director Compensation for Fiscal Year 2023 The following table summarizes the compensation earned by, or awarded or paid to, those directors who, for the fiscal year ended December 31, 2023, were compensated for their service as directors. None of the other directors (i.e., those not listed in the table) earned, were awarded or were paid any compensation from us for the fiscal year ended December 31, 2023, for their service as directors.

  6. Director Compensation for Fiscal Year 2023

    | Name | Fees earned or paid in cash ($)(1) | Stock Awards ($)(2) | Total ($) | | Venmal (Raji) Arasu | 57,500 | 170,398 | 227,898 | | Lara Sweet | 67,500 | 170,398 | 237,898 | | Kathy Vrabeck | 95,000 | 170,398 | 265,398 |

  7. Director Compensation for Fiscal Year 2023

    (1) Reflects the cash retainers paid to such director for service on our Board and committees during 2023. (2) Represents the aggregate grant date fair value of the annual RSU award granted on May 19, 2023, computed in accordance with Accounting Standards Codification Topic 718 as issued by the Financial Accounting Standards Board (“ASC Topic 718”). Each award was for 25,547 RSUs, with a grant date value of $170,398, and will vest in full on the earlier of (a) the one-year anniversary of the date of grant and (b) the date of the Company’s 2024 Annual Meeting of Stockholders, subject to continued service through the applicable vesting date. The aggregate number of RSUs outstanding at 2023 fiscal year end for each such director was 25,547. Under the Company’s director compensation policy, each non-employee director is entitled to: • an annual cash retainer of $40,000, payable quarterly in arrears; • annual equity-based compensation of $175,000 in the form of RSUs, subject to the terms described below; and • for new non-employee directors who join our Board of Directors, an initial, one-time equity award of $300,000 in the form of RSUs, granted as of the time of their appointment, which vest quarterly over three years following the date of grant, subject to continued service through the applicable vesting date. Annual equity awards will be granted to each director as of the date of each annual stockholder meeting, prospectively for the year of service following the annual stockholder meeting. The number of RSUs granted is determined by dividing $175,000 by the average closing price of a share of the Company’s Class A common stock for the twenty (20) trading day period ended on the Friday immediately preceding the grant date of such award, and such awards vest in full on the earlier of (x) the one-year anniversary of the grant date and (y) the following year’s annual stockholder meeting, subject to continued service. Any non-employee director who joins our Board of Directors mid-year will receive prorated annual cash retainers during the director’s first year of service. In addition, our director compensation policy provides for annual retainers for the chairperson of our Board of Directors, lead independent director (if applicable), committee chairs and committee members, in the following amounts: • $25,000 for the chair; • $20,000 for the lead independent director (if not the chair); • $20,000 for the chair of our Audit Committee; • $15,000 for the chair of our Compensation Committee; • $10,000 for the chair of our Nominating and Corporate Governance Committee; • $10,000 for each member of the Audit Committee, other than the chair; • $7,500 for each member of the Compensation Committee, other than the chair; and • $5,000 for each member of the Nominating and Corporate Governance Committee, other than the chair. Members of our Board of Directors who are representatives of White Mountains and Insignia have each agreed, subject to annual confirmation and provided that the Company remains a controlled company, to waive fees that would have been due to them under our director compensation policy in respect of their services on our Board of Directors and committees. PROPOSAL 2: APPROVAL OF AMENDMENT TO OUR AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO REFLECT NEW DELAWARE LAW PROVISIONS REGARDING OFFICER EXCULPATION The Board has unanimously approved and declared advisable, and recommends that our shareholders adopt, a proposed amendment to our Amended and Restated Certificate of Incorporation to reflect new Delaware law provisions regarding officer exculpation. Article IX, Section 9.01 of our Amended and Restated Certificate of Incorporation currently includes a provision, authorized under the DGCL, that eliminates the personal liability of Directors for monetary damages for breach of fiduciary duty as a Director to the fullest extent permitted by the DGCL. Prior to 2022, the DGCL did not allow for similar elimination or limitation of officers’ personal liability. As a result, shareholder plaintiffs employed tactics of bringing certain claims against individual officers when such claims would otherwise be exculpated and dismissed if brought against directors. However, the State of Delaware, which is the Company’s state of incorporation, recently amended Section 102(b)(7) of the DGCL to enable Delaware companies to limit the personal liability of certain of their officers in limited circumstances (the “Section 102(b)(7) Amendment”). The Section 102(b)(7) Amendment was adopted to address inconsistent treatment between officers and directors and address rising litigation and insurance costs for shareholders. The Board believes that there is a need for directors and officers to remain free of the risk of financial ruin as a result of an unintentional misstep. The nature of the role of directors and officers often requires them to make decisions on crucial matters. Frequently, directors and officers must make decisions in response to time-sensitive opportunities and challenges in an evolving macroeconomic and regulatory environment, without the benefit of hindsight. The Board believes that exculpation provisions empower both directors and officers to exercise their best judgment in furtherance of shareholder interests. In addition, adopting an exculpation provision that aligns with Delaware law could prevent costly and protracted litigation that distracts our officers from important operational and strategic matters. The Board also expects that exculpation clauses applicable to officers could become widely used by public corporations, including our peers, and that failing to adopt the Section 102(b)(7) Amendment could negatively impact our ability to recruit and retain exceptional officer candidates who value the protection from potential exposure to liabilities, costs of defense, and other risks of proceedings that would be afforded by protection similar to that afforded by the Section 102(b)(7) Amendment. Additionally, the Section 102(b)(7) Amendment will align the protections for our officers with those protections already afforded to our Directors. In light of the Section 102(b)(7) Amendment, we propose to amend our Amended and Restated Certificate of Incorporation to add a provision exculpating certain of the Company’s officers from liability, as permitted by Delaware law, similar to the protections currently available for Directors of the Company in our current Amended and Restated Certificate of Incorporation. The new Delaware legislation only permits, and our proposed amendment would only permit, exculpation for direct claims (as opposed to derivative claims made by shareholders on behalf of the Company) and would not apply to breaches of the duty of loyalty, acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law, or any transaction in which the officer derived an improper personal benefit. The rationale for so limiting the scope of liability is to strike a balance between shareholders’ interest in accountability and their interest in the Company being able to attract and retain quality officers to work on its behalf. For these reasons, our Board has determined that it is in the best interests of the Company and its shareholders to seek to update the exculpation provision.

  8. Compensation Philosophy and Objectives

    Compensation Philosophy and Objectives Our executive compensation program is designed to (i) attract, retain and motivate top-level talent who possess the skills and leadership necessary to grow our business, (ii) provide compensation packages that are competitive with market practice and drive and reward the achievement of our business objectives, (iii) closely align the interests of our NEOs with those of our stockholders by linking pay to performance to produce sustainable, long-term value growth for our stockholders and (iv) utilize a balance of short-term and long-term incentives that serve as meaningful inputs to value creation and reward outperformance. At the core of our compensation philosophy, we aim to provide a compensation package to each of our NEOs that emphasizes pay-for-performance, and that is both externally competitive to the market and internally equitable within our organization. We believe that a performance-based culture is critical to our growth and success, and our compensation program is designed to foster these core beliefs. Our executive compensation program design includes a mix of three key compensation elements—(i) base salary, (ii) short-term cash incentive awards and (iii) long-term equity incentive awards. In determining the amount of each compensation element awarded to our NEOs, our Compensation Committee looks at each NEO’s overall compensation package, as well as the amount of each compensation element for the NEO, to determine whether such amounts and the overall mix of elements for the NEO’s role further the principles and objectives of our executive compensation program. Consistent with our pay-for-performance philosophy, and to ensure our NEOs’ interests are closely aligned with those of our stockholders, a substantial portion of our NEOs’ compensation is awarded in the form of variable, “at-risk” short-term and long-term incentive awards: •93% of 2023 target total compensation for our Chief Executive Officer and Chief Technology Officer (our Co-Founders) was comprised of at-risk compensation elements (i.e., salary paid in equity and short-term and long-term incentive awards); and •On average, 85% of 2023 target total compensation for our other NEOs was comprised of at-risk compensation elements (i.e., short-term and long-term incentive awards). The short-term incentive awards are earned based on the achievement of rigorous financial top-line and profitability performance goals set by the Compensation Committee in the first quarter of each year. The long-term incentives are granted in the form of equity incentive awards, the realized value of which bears a direct relationship to our stock price. The Compensation Committee periodically reviews and analyzes market trends and adjusts the design and operation of our executive compensation program from time to time as it deems necessary and appropriate. While the Compensation Committee considers a multitude of factors in its deliberations, it places no formal weighting on any one factor. As we continue to transition from a newly public company to a more mature public company, the Compensation Committee will evaluate our executive compensation program to ensure that it continues to align with our compensation philosophy and objectives and helps to drive the future growth of the Company. This evaluation includes an ongoing review of whether the Company should tie the vesting of all or a portion of long-term incentive awards to the achievement of financial and/or shareholder value goals set by the Compensation Committee.

  9. Executive Compensation Practices

    | What We Do | What We Don’t Do | | Pay-for-Performance Philosophy. We align pay and performance by awarding a substantial portion of the compensation paid to our executives in the form of variable, “at-risk” performance-based compensation linked to achievement of rigorous performance goals. | No Guaranteed Bonuses. Our annual bonus plans are performance-based and generally do not include any guaranteed minimum payment levels. | | Maintain an Independent Compensation Committee. Our Compensation Committee is comprised solely of independent directors with extensive industry experience. | No “Single-Trigger” Change of Control Arrangements. Following our IPO, we do not provide for “single-trigger” acceleration of compensation or benefits solely upon a change of control for our NEOs. | | Maintain an Independent Compensation Committee Advisor. The Compensation Committee engages its own independent compensation consultant. | No Excise Tax “Gross-Ups”. We do not provide any “gross-ups” for excise taxes that our employees might owe as a result of the application of Sections 280G or 4999 of the IRC. | | Conduct Annual Compensation Review. The Compensation Committee conducts a review at least annually of our executive compensation philosophy and strategy, including a review of the compensation peer group used for comparative purposes. | No Material Perquisites. We do not provide material perquisites or other material personal benefits to our NEOs or directors. | | Perform Annual Compensation-Related Risk Assessment. We have strong risk and control policies, we take risk management into account in making executive compensation decisions, and we conduct an annual risk assessment of our executive and broad-based compensation programs to promote prudent risk management. | No Executive Pensions. We do not offer any executive pension plans. |

  10. Executive Compensation Process

    Executive Compensation Process Role of the Compensation Committee The Compensation Committee establishes our overall compensation philosophy and objectives, and is responsible for establishing, overseeing and evaluating our executive compensation program. The Compensation Committee is comprised entirely of independent directors and operates under a written charter adopted and reviewed annually by our Board. The Compensation Committee reviews and assesses whether our executive compensation program aligns with our compensation philosophy and objectives, and approves the specific compensation of our NEOs, typically during the first quarter of our fiscal year. The Compensation Committee has not delegated any of its authority with respect to the compensation of our executive officers. 1 A reconciliation of Adjusted EBITDA to net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, is included in Appendix B to this Proxy Statement. Role of Management The Compensation Committee consults with members of our management team, including our Chief Executive Officer (“CEO”) and our people operations, finance and legal professionals, when making compensation decisions. Our CEO works closely with the Compensation Committee and provides the Compensation Committee with performance assessments and compensation recommendations for each NEO other than himself, based on each NEO’s level of performance and corporate performance, retention risk and taking into consideration market practices. While the Compensation Committee considers our CEO’s recommendations, the Compensation Committee ultimately uses its own business judgment and experience in approving individual compensation elements and the amount of each element for our NEOs. Role of Compensation Consultant Pursuant to its charter, the Compensation Committee has the authority to engage its own legal counsel and other advisors, including compensation consultants, to assist in carrying out its responsibilities. The Compensation Committee is directly responsible for the appointment, compensation and oversight of the work of any such advisor and has sole authority to approve all such advisors’ fees and other retention terms. Pursuant to this authority, for fiscal 2023, the Compensation Committee engaged ClearBridge Compensation Group, LLC (“ClearBridge”) to provide independent advice on matters relating to our executive compensation program, including information regarding competitive market practices, assessments and trends and advice relating to the design and structure of our executive compensation program. ClearBridge also updates the Compensation Committee on corporate governance and regulatory issues and developments. A representative of ClearBridge attends meetings of the Compensation Committee as requested. The Compensation Committee may replace its compensation consultant or hire additional advisors at any time. ClearBridge has not provided any other services to us and has received no compensation other than with respect to the services described below. The Compensation Committee has evaluated ClearBridge’s independence by considering the requirements adopted by the NYSE and the SEC, and has determined that its relationship with ClearBridge does not raise any conflict of interest. Peer Group For purposes of comparing our executive compensation program against the competitive market, the Compensation Committee reviews and considers the compensation levels and practices of a specified group of peer companies. For 2023, the Compensation Committee, with the assistance of ClearBridge, reviewed and updated our compensation peer group to account for acquisitions of certain peer companies and changes in the market capitalization and/or revenue levels of certain peer companies. The companies in this compensation peer group were selected on the basis of their similarity to us in terms of industry and financial characteristics, as determined using the following criteria: • similar size, as measured by revenue and market capitalization; • similar industry, business model and/or services; • headquartered in the United States and traded on a major stock exchange; and • preference for high annual revenue growth companies. As a result, the Compensation Committee approved a revised compensation peer group for purposes of understanding the competitive market for executive talent to help inform the Compensation Committee's fiscal 2023 compensation decisions: Fiscal 2023 Peer Group Companies

  11. Executive Compensation Process

    At the time the Fiscal 2023 Peer Group Companies were approved, the Company generally approximated the peer group median for the size criteria considered (e.g., revenue and market capitalization). Compensation-Setting Process and Competitive Positioning When determining recommendations for our NEOs’ fiscal 2023 compensation levels, the Compensation Committee reviewed base salary, target annual incentive compensation opportunity, target total cash compensation (i.e., base salary plus target incentive opportunity), annual long-term incentive, and total direct compensation values for our NEOs and those of similarly situated executives of our compensation peer group. ClearBridge provided data at the 25th, 50th, and 75th percentiles of the peer group for such compensation, which our Compensation Committee used as a reference. In addition, in connection with its assessment of annual long-term incentives to be granted to our NEOs, the Compensation Committee reviewed the overall retentive value of our NEOs’ existing unvested equity incentive awards. The Compensation Committee considers such data relevant to, but not determinative of, its consideration of overall executive compensation matters. The Compensation Committee does not benchmark any compensation element to a specific percentile, and the Compensation Committee instead establishes our NEOs’ compensation at levels it deems appropriate after considering other factors, including the Compensation Committee's assessment of each of our NEOs’ performance and contributions, our short-term and long-term objectives, retention considerations, prevailing market conditions, and the recommendations provided by our CEO with respect to the compensation of our other executive officers. The Compensation Committee believes that it is appropriate for the compensation levels for our co-Founders to be at the same level given the criticality of both roles to the future success of the Company.

  12. Analysis of Fiscal 2023 Compensation

    On July 29, 2023, the Compensation Committee approved amendments to the Amended and Restated Employment Agreements with Messrs. Yi and Nonko, which provide that, for base salary earned on and after September 15, 2023, the Company will pay each such executive a portion of his base salary in the form of cash. This cash amount will equal the greater of (i) $70,000 per year and (ii) the minimum annual salary required for the executive to qualify as an exempt employee. The amendments further provide that the remaining portion of each such executive’s base salary will be paid to the executive in the form of a restricted stock unit award covering shares of the Company’s Class A common stock (each, a “Salary RSU Award”). Each Salary RSU Award will vest in full on the three (3) month anniversary of its grant date, subject to the executive’s continued employment. The number of shares covered by each Salary RSU Award will be based on the average closing price of a share of the Company’s Class A common stock for the twenty (20) trading day period ending on the Friday immediately preceding such Salary RSU Award’s grant date (and, if such Friday is not a business day, the business day immediately preceding such Friday). In the event of a termination of any such executive’s employment with the Company for any reason, a prorated portion of the executive’s then outstanding and unvested Salary RSU Award will vest. Such prorated portion will be based on the number of days of the executive’s employment prior to and including such termination, and any portion of the executive’s Salary RSU Award that remains unvested thereafter will be forfeited. Salary RSU Awards will not be subject to any other vesting acceleration. Accordingly, on September 15, 2023, in lieu of salary for the period from September 15, 2023 through December 14, 2023, the Company granted each of Messrs. Yi and Nonko Salary RSU Awards consisting of 14,100 RSUs, which awards vested in full on December 15, 2023, and on December 15, 2023, in lieu of salary for the period from December 15, 2023 through March 14, 2024, the Company granted each of Messrs. Yi and Nonko Salary RSU Awards consisting of 12,150 RSUs, which awards vested in full on March 15, 2024. Annual Incentive Bonus Plan We use incentive bonus programs to motivate our NEOs to achieve our short-term financial and operational objectives while making progress towards our longer-term growth and other key goals and initiatives. These incentive bonuses are generally tied to the achievement of rigorous top-line and/or profitability goals, as those are the key metrics that the Compensation Committee believes will ultimately drive the creation of long-term shareholder value. Consistent with our executive compensation philosophy, these incentive bonus awards are intended to offer market competitive incentive opportunities to our NEOs. In late 2022 and early 2023, the Compensation Committee undertook a process, in consultation with ClearBridge, to develop a new incentive compensation plan for our NEOs for 2023. As part of this effort, the Compensation Committee reviewed incentive compensation plan structures and practices among the peer companies, and discussed how different plan structures would align with the Company's compensation philosophy and strategic goals. As a result of this process, the Compensation Committee developed and approved an incentive plan structure for the NEOs, which is tied to achievement of rigorous financial goals approved by the Compensation Committee at the beginning of the year. For fiscal 2023, each NEO had a specified target bonus opportunity under such plan equal to a specified percentage of his annual base salary. Payouts under such plan (calculated as a percentage of the target payout) are determined by the Compensation Committee in the first quarter of the following year, following completion of the audit of the Company’s financial statements for the completed fiscal year. Target Incentives. In February 2023, the Compensation Committee conducted an assessment of the target bonus opportunities of our CEO and our other NEOs, in consultation with ClearBridge, and reviewed market data, relative levels of responsibility across the Company, tenure, and other relevant factors. Based on such assessment, the Compensation Committee established the following target cash incentives for such NEOs for fiscal 2023:

  13. Analysis of Fiscal 2023 Compensation

    | Measure | Threshold (50% Payout) | Target (100% Payout) | Maximum (150% Payout) | | 2023 Transaction Value | $672.7 million | $840.9 million | $1,009.1 million | | 2023 Adjusted EBITDA | $29.5 million | $36.9 million | $44.3 million |

  14. Analysis of Fiscal 2023 Compensation

    | Measure | Actual Result | Resulting Payout | | 2023 Transaction Value | $593.4 million | —% | | 2023 Adjusted EBITDA | $27.1 million | —% |

  15. Analysis of Fiscal 2023 Compensation

    We did not achieve the threshold level for either of the financial measures established under the incentive program for 2023, and therefore, no incentive bonuses were earned by our NEOs for 2023. In addition, based on such results all of the PRSUs granted to our CEO and CTO in lieu of their participation in our 2023 incentive bonus plan were forfeited. A reconciliation of Adjusted EBITDA to net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, for the fiscal year ended December 31, 2023, is included in Appendix B to this Proxy Statement. Long-Term Equity Incentives We provide long-term incentive compensation to our NEOs through equity-based awards made under our 2020 Omnibus Incentive Plan, typically restricted stock and/or restricted stock units (“RSUs”), which generally vest over multiple years. The Compensation Committee believes that this policy further aligns the interests of the NEOs with those of our stockholders and incentivizes the NEOs to drive sustained, long-term financial performance, while at the same time helping to foster continued retention of our NEOs in a competitive talent market. The Compensation Committee typically grants these equity-based awards to the NEOs in the first quarter of each year, and calculates the number of awards to be granted based on the average closing price of our Class A common stock over the twenty (20) trading day period ended on the Friday immediately preceding the grant date of such awards. In October 2020, in connection with our IPO, the Board (prior to the creation of the Compensation Committee) approved RSU awards to our CEO and CTO, which awards vest quarterly over a period of three years following the grant date. Accordingly, in early 2021, when the Compensation Committee was considering the compensation of such NEOs for fiscal 2021, the Compensation Committee determined that it was appropriate to not make annual equity awards to such NEOs for fiscal 2021. During 2021, the Compensation Committee approved RSU awards to certain NEOs as part of such NEOs’ new-hire compensation packages, as set forth below. In May 2021, the Compensation Committee approved a new-hire RSU award to Mr. Coyne with a grant date value of $1,318,000 (prorated to his start date based on a March 1 grant cycle), vesting over a four-year period. In November 2021, the Compensation Committee approved a new-hire RSU award to Mr. Thompson with a grant date value of $2,500,000, vesting over a four-year period, and an additional RSU award with a grant date value of $2,750,000, vesting over a two-year period, to partially compensate for vesting of equity awards that Mr. Thompson forfeited by leaving his previous employer. In March 2023, the Compensation Committee, in consultation with ClearBridge, reviewed the Company's long-term incentive ("LTI") compensation program for our NEOs. As part of this effort, the Compensation Committee reviewed LTI compensation plan structures and practices among the peer companies, and discussed how different LTI plan structures would align with the Company's compensation philosophy and strategic goals. Such review included the types of awards granted, the use of time-based and performance-based vesting, different performance-based vesting structures, and the grant date values of the awards. The Compensation Committee discussed different potential LTI award structures and determined that, due to factors including the volatility of the Company's share price due in part to the limited trading market for the Company's shares, the uncertainty regarding the timing of a recovery on the P&C insurance market, and the resulting difficulty in setting credible long-term performance goals tied to either financial performance or total shareholder return, the Company would continue to grant time-based RSUs for 2023. In addition, the Compensation Committee noted that time-based RSUs still align with long-term shareholder interests in both up and down markets, and that the significant majority of our CEO and our other NEOs’ target compensation in 2023 was granted in RSUs, reinforcing the alignment with shareholder interests and stock price performance. The Compensation Committee will continue to revisit this issue in the future. The Compensation Committee then reviewed the target annual equity award values of our CEO and our other NEOs, taking into consideration a competitive market analysis performed by ClearBridge, which included a review of the market data of the compensation peer group for our executive officer positions and an evaluation of the market positioning of the target annual equity award values for each position compared with those of comparable positions at the peer companies. The Compensation Committee also considered the current value of the unvested equity held by each NEO and whether such unvested awards provide appropriate level of retention value for such NEO. Based on this review, the Compensation Committee approved the following annual time-based RSU awards to the NEOs for 2023:

  16. Analysis of Fiscal 2023 Compensation

    The RSU grant values reflect an increase versus the 2022 levels for each of our NEOs, based on the factors described above. The increases were intended in part to bring each of our NEOs closer to the competitive market range for long-term incentives and total target compensation as reflected in the peer company data, and also to place additional emphasis on alignment with shareholder interests by shifting a greater proportion of each NEO's total target pay to long-term incentives. Annual long-term incentive awards are evaluated on a case-by-case basis, and increases are not guaranteed. Such RSUs were granted pursuant to the terms of our 2020 Omnibus Incentive Plan and the RSU Award Agreements, and vest in 16 equal quarterly installments commencing May 15, 2023 and ending February 15, 2027, in each case subject to the NEO's continued employment through each vesting date. The vesting of equity awards granted to our NEOs is subject to acceleration under certain circumstances as discussed under the heading “Payments Upon Termination of Employment or Change in Control” below.

  17. Summary Compensation Table

    Summary Compensation Table The following table sets forth the total compensation awarded to, or earned by or paid to, each of our NEOs for fiscal years 2021, 2022 and 2023.

  18. Summary Compensation Table

    | Name and principal position | Fiscal Year | Salary ($)(1) | Bonus ($) | Stock Awards ($)(2) | Nonequity Incentive Plan Compensation ($)(3) | All Other Compensation ($)(4) | Total ($) | | Steven Yi | 2023 | 550,000 | — | 5,179,192 | — | 24,503 | 5,753,695 | | Chief Executive Officer and President | 2022 | 550,000 | — | 4,372,938 | — | 29,078 | 4,952,016 | | | 2021 | 550,000 | — | 41,068 | 440,000 | 28,780 | 1,059,848 | | Eugene Nonko | 2023 | 550,000 | — | 5,179,192 | — | 22,669 | 5,751,861 | | Chief Technology Officer | 2022 | 550,000 | — | 4,372,938 | — | 26,864 | 4,949,802 | | | 2021 | 550,000 | — | 41,068 | 440,000 | 26,610 | 1,057,678 | | Patrick Thompson(5) | 2023 | 475,000 | — | 2,964,713 | — | 11,250 | 3,450,963 | | Chief Financial Officer and Treasurer | 2022 | 450,000 | — | — | — | 10,250 | 460,250 | | | 2021 | 31,950 | — | 5,105,843 | 15,671 | — | 5,135,464 | | Jeffrey Coyne(6) | 2023 | 397,500 | — | 1,647,063 | — | 13,200 | 2,057,763 | | General Counsel | 2022 | 383,333 | — | 1,488,834 | — | 12,783 | 1,884,950 | | | 2021 | 249,750 | — | 979,289 | 99,863 | 4,988 | 1,333,890 |

  19. Summary Compensation Table

    (1) Salary amounts shown above represent actual salary earned during the year, reported as gross earnings (i.e., gross amounts before taxes and applicable payroll deductions). In addition, with respect to Messrs. Yi and Nonko, salary amounts include (i) $120,000, which represents the salary foregone in lieu of Salary RSU Awards granted on September 15, 2023 for the period September 15, 2023 through December 14, 2023 and (ii) $20,000, which represents the pro-rated portion of the salary foregone in fiscal 2023 in lieu of Salary RSU Awards granted on December 15, 2023 for the period December 15, 2023 through March 14, 2024, which Salary RSU Awards are discussed in greater detail in “Compensation Discussion and Analysis - Analysis of Fiscal 2023 Compensation – Base Salary” above. Since the amount of salary foregone for the period September 15, 2023 through December 14, 2023 exceeds the grant date fair value of the Salary RSU Awards granted on September 15, 2023, the entire salary foregone has been classified as Salary. Since the amount of salary foregone for the period December 15, 2023 through March 14, 2024 is less than the grant date fair value of the Salary RSU Awards granted on December 15, 2023, in accordance with applicable SEC guidance, the pro-rata portion of the salary foregone attributable to fiscal 2023 has been classified as Salary. See the “Grants of Plan-Based Awards in Fiscal 2023” table below for additional details on the Salary RSU Awards granted to Messrs. Yi and Nonko on September 15, 2023 and December 15, 2023. (2) Amounts in this column reflect the aggregate grant date fair value of time-vesting RSUs granted in each year, computed in accordance with ASC 718. For 2023, the amounts shown for Messrs, Yi and Nonko does not include the grant date fair value of the PRSUs granted to them in lieu of participation in the 2023 annual cash incentive bonus plan for NEOs. The minimum levels for such performance measures were not achieved, and so such PRSUs did not vest and were forfeited. See additional information regarding such PRSUs under the heading “Compensation Discussion and Analysis - Analysis of Fiscal 2023 Compensation – Annual Incentive Bonus Plan” above. However, in accordance with applicable SEC guidance, the amounts shown for Messrs. Yi and Nonko for 2023 does include, for the period December 15, 2023 through March 14, 2024, the difference between the grant date fair value of the Salary RSU Awards granted on December 15, 2023 and the salary forgone for such period, pro-rated for the portion attributable to fiscal 2023. For 2021, the amounts shown for Messrs. Yi and Nonko consist of the difference between (a) the grant date fair value of the immediately vested RSUs granted to such NEOs in lieu of cash bonuses earned by them, and (b) the cash value of such bonuses. See additional information in footnote 3 below. (3) For each NEO, reflects the annual cash bonuses earned under our cash incentive plan for such year, based on the achievement of annual performance goals for such year. Such amounts were earned at 0%, 0%, and 80% of target for 2023, 2022 and 2021, respectively. For 2023 and 2022, Messrs. Yi and Nonko were granted PRSUs in lieu of participation in such plan. See additional information regarding the incentive bonuses paid to our NEOs for 2023 under the heading “Compensation Discussion and Analysis - Analysis of Fiscal 2023 Compensation – Annual Incentive Bonus Plan” above. Such bonuses for each year were paid in the first quarter of the following year. The bonuses payable to Messrs. Yi and Nonko for 2021 were paid by the issuance of a number of immediately vested RSUs determined by dividing the cash amount of the bonus earned by the weighted-average closing price of our common stock for the three-month period prior to the grant date. Amounts in this column are reported as gross earnings (i.e., gross amounts before taxes and applicable payroll deductions). (4) Amounts in this column include, for Messrs. Thompson and Coyne for 2023 and 2022 and each NEO for 2021, employer contributions under our 401(k) plan. Amounts reported for fiscal year 2023, 2022, and 2021 for Mr. Yi also include $24,503, $29,078, and $20,230, respectively, and for Mr. Nonko $22,669, $26,864 and $18,060, respectively, as reimbursement for self- employment taxes (including related tax gross-ups). (5) Mr. Thompson joined the Company as Chief Financial Officer and Treasurer on December 6, 2021. (6) Mr. Coyne joined the Company as General Counsel and Secretary on May 3, 2021.

  20. Grants of Plan-Based Awards in Fiscal 2023

    Grants of Plan-Based Awards in Fiscal 2023

  21. Grants of Plan-Based Awards in Fiscal 2023

    | Name | Grant Date | Estimated Possible Payouts under Non-Equity Incentive Plan Awards(1) | | | Estimated Possible Payouts under Equity Incentive Plan Awards(2) | | | All Other Stock Awards: Number of Shares of Stock(3) (#) | Grant Date Fair Value of Stock Awards(4) ($) | | | | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | Steven Yi | — | — | — | — | 18,700 | 37,350 | 56,000 | — | — | | | 03/15/23 | — | — | — | — | — | — | 373,250 | 5,176,978 | | | 09/15/23 | — | — | — | — | — | — | 14,100 | 112,377 | | | 12/15/23 | — | — | — | — | — | — | 12,150 | 133,286 | | Eugene Nonko | — | — | — | — | 18,700 | 37,350 | 56,000 | — | — | | | 03/15/23 | — | — | — | — | — | — | 373,250 | 5,176,978 | | | 09/15/23 | — | — | — | — | — | — | 14,100 | 112,377 | | | 12/15/23 | — | — | — | — | — | — | 12,150 | 133,286 | | Patrick Thompson | — | 180,000 | 360,000 | 540,000 | — | — | — | — | — | | | 03/15/23 | — | — | — | — | — | — | 213,750 | 2,964,713 | | Jeffrey Coyne | — | 100,000 | 200,000 | 300,000 | — | — | — | — | — | | | 03/15/23 | — | — | — | — | — | — | 118,750 | 1,647,063 |

  22. Grants of Plan-Based Awards in Fiscal 2023

    (1) Reflects the potential payouts to the NEOs under awards granted under our annual cash incentive plan, which is described in more detail in the section entitled “Compensation Discussion and Analysis – Analysis of Fiscal 2023 Compensation – Annual Incentive Bonus Plan” beginning on page 26. The amounts shown as threshold, target and maximum payouts represent 50%, 100% and 150% payouts, respectively, of each NEO’s annual target incentive based on minimum, target and maximum performance levels for the financial performance measures established under such plan for 2023. The minimum levels for such performance measures were not achieved, and so no payouts were made for 2023. (2) Reflects the potential vesting of the PRSUs granted in lieu of participation in our annual cash incentive plan, as described in more detail in the section entitled “Compensation Discussion and Analysis – Analysis of Fiscal 2023 Compensation – Annual Incentive Bonus Plan - Performance-Based RSUs in Lieu of Incentive Bonus Plan.” beginning on page 26. The amounts shown as threshold, target and maximum numbers of vested shares represent 50%, 100% and 150% payouts, respectively, of each NEO’s annual target incentive based on minimum, target and maximum performance levels for the financial performance measures established under such plan for 2023. The minimum levels for such performance measures were not achieved, and so such PRSUs did not vest and were forfeited. (3) Consists of time-based RSUs awarded to the NEO for 2023 under our 2020 Omnibus Incentive Plan, which are described in more detail under “Compensation Discussion and Analysis.” The annual RSUs granted to our NEOs in March 2023 will vest in equal quarterly installments over a four-year period commencing May 15, 2023 and continuing through February 15, 2027, subject to the NEO's continued service with the Company. The RSU grants made to Messrs. Yi and Nonko on September 15, 2023 and December 15, 2023 in lieu of base salary vested in full on December 15, 2023 and March 15, 2024, respectively, as described in more detail in the section entitled “Compensation Discussion and Analysis – Analysis of Fiscal 2023 Compensation – Base Salary. (4) Reflects the grant date fair values of the RSUs awarded to the NEO, which were computed in accordance with ASC 718 based on the closing price of our common stock on the grant date.

  23. Outstanding Equity Awards at 2023 Fiscal Year End

    Outstanding Equity Awards at 2023 Fiscal Year End The following table sets forth information regarding outstanding equity compensation awards held as of December 31, 2023 by our NEOs. The Company has not granted any option awards, and accordingly certain columns have been omitted.

  24. Outstanding Equity Awards at 2023 Fiscal Year End

    | Name | Award Type (1) | Number of Shares or Units that Have not Vested (#)(2) | Market Value of Shares or Units that Have not Vested ($)(3) | | Steven Yi | RSUs | 480,060 | 5,352,669 | | Eugene Nonko | RSUs | 480,060 | 5,352,669 | | Patrick Thompson | RSUs | 251,847 | 2,808,094 | | Jeffrey Coyne | RSUs | 167,139 | 1,863,600 |

  25. Outstanding Equity Awards at 2023 Fiscal Year End

    (1) Reflects unvested time-vesting RSUs held, directly or indirectly, by each NEO as of December 31, 2023. Excludes the PRSUs granted to Messrs. Yi and Nonko in lieu of participation in our annual cash incentive plan, as the minimum levels for the performance measures were not achieved, and so such PRSUs did not vest and were forfeited. (2) Amounts shown for Messrs. Yi and Nonko include 12,150 RSUs granted to each of them on December 15, 2023 in lieu of base salary for the period from December 15, 2023 through March 14, 2024, as described in more detail in the section entitled “Compensation Discussion and Analysis – Analysis of Fiscal 2023 Compensation – Base Salary.” (3) The values shown are based on $11.15, the closing price of our Class A common stock on December 29, 2023.

  26. Stock Vested in Fiscal 2023

    Stock Vested in Fiscal 2023 The following table sets forth certain information for each NEO regarding the vesting of stock awards during the fiscal year ended December 31, 2023, including the aggregate value realized upon such exercise or vesting. The Company has not granted any option awards, and accordingly certain columns have been omitted from the table.

  27. Stock Vested in Fiscal 2023

    | Name | Number of shares acquired on vesting (#) | Value realized on vesting ($) (1) | | Steven Yi | 769,853 | 7,532,268 | | Eugene Nonko | 769,853 | 7,532,268 | | Patrick Thompson | 135,410 | 1,233,194 | | Jeffrey Coyne | 55,941 | 500,218 |

  28. Stock Vested in Fiscal 2023

    (1) Reflects the total market value of shares that each NEO was entitled to receive upon the vesting of RSUs during 2023, calculated based on the closing price of our Class A common stock on the vesting date. A portion of the vested shares issued to each of Messrs. Thompson and Coyne was withheld by the Company to cover the tax withholding obligations related to the vesting. Amounts shown for Messrs. Yi and Nonko include 14,100 RSUs granted to each of them on September 15, 2023 in lieu of base salary for the period from September 15, 2023 through December 14, 2023, as described in more detail in the section entitled “Compensation Discussion and Analysis – Analysis of Fiscal 2023 Compensation – Base Salary.” Such RSUs vested in full on December 15, 2023.

  29. Potential Payments Upon Termination or Change of Control

    Potential Payments Upon Termination or Change of Control In the event of a qualifying termination of employment and/or the occurrence of a change of control of the Company, certain of our NEOs are entitled to certain payments and benefits under their employment agreements, severance compensation agreements and/or our severance policies. For a detailed summary of these payments and benefits, see the section entitled “Employment and Severance Compensation Agreements” that follows the table below.

  30. Termination Following Change of Control

    | Name | Salary-Based Severance Payments ($)(1) | Incentive- Based Severance Payments($)(2) | Stock Awards($)(3) | Continuation of Benefits($)(4) | Total Estimated Payments($) | | Steven Yi | 825,000 | 825,000 | 5,352,669 | 50,097 | 7,052,766 | | Eugene Nonko | 825,000 | 825,000 | 5,352,669 | 50,097 | 7,052,766 | | Patrick Thompson | 720,000 | 360,000 | 2,808,094 | 50,097 | 3,938,191 | | Jeffrey Coyne | 600,000 | 200,000 | 1,863,600 | 50,091 | 2,713,691 |

  31. Other Qualifying Terminations

    | Name | Salary-Based Severance Payments($)(1) | Incentive- Based Severance Payments($)(2) | Stock Awards($)(3) | Continuation of Benefits($)(4) | Total Estimated Payments($) | | Steven Yi | 825,000 | 825,000 | 2,919,973 | 50,097 | 4,620,070 | | Eugene Nonko | 825,000 | 825,000 | 2,919,973 | 50,097 | 4,620,070 | | Patrick Thompson | 480,000 | 360,000 | — | 33,398 | 873,398 | | Jeffrey Coyne | 400,000 | 200,000 | — | 33,394 | 633,394 |

  32. CEO Pay Ratio Disclosure

    CEO Pay Ratio Disclosure As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(u) of Regulation S-K, below is (i) the 2023 annual total compensation of our Chief Executive Officer, Mr. Yi; (ii) the 2023 annual total compensation of our median employee; (iii) the ratio of the annual total compensation of our CEO to that of our median employee, and (iv) the methodology we used to calculate our CEO pay ratio:

  33. CEO Pay Ratio Disclosure

    | CEO Annual Total Compensation | $5,753,695 | | Median Employee Total Annual Compensation | $223,830 | | CEO to Median Employee Pay Ratio | 25.7-to-1 |

  34. CEO Pay Ratio Disclosure

    Given the different methodologies that various public companies will use to determine an estimate of their pay ratios, the estimated ratio reported above should not be used as a basis for comparison between companies. Methodology Our CEO pay ratio is a reasonable estimate calculated in a manner consistent with SEC rules. Our methodology and process are explained below: (1) Determined Employee Population. We began with our global employee population as of December 31, 2023, including full-time and part-time workers employed by our company or consolidated subsidiaries, but excluding our CEO. (2) Identified the Median Employee. To identify the median employee, we calculated compensation for each employee using (i) base annual salary including estimated overtime pay as of December 31, 2023, (ii) cash incentives earned for 2023, (iii) the grant date value of RSU awards granted to the employee during 2023, and (iv) contributions made to such employee’s 401(k) account. We annualized the compensation of all full-time and part-time employees who were not employed by us for all of 2023. Compensation paid in foreign currency was translated to the U.S. dollar equivalent based on foreign exchange rates as of December 31, 2023. (3) Calculated CEO Pay Ratio. We calculated our median employee’s annual total compensation for 2023 in accordance with SEC rules for preparing the Summary Compensation Table. We compared the median employee’s compensation to our CEO’s annual total compensation in the Summary Compensation Table to determine the pay ratio shown above.

  35. Pay-versus-Performance Table

    | Year | Summary Compensation Table Total for PEO(1) | Compensation Actually Paid to PEO(1)(2)(7) | Average Summary Compensation Table Total for Non-PEO NEOs(3) | Average Compensation Actually Paid to Non-PEO NEOs(2)(3)(7) | Value of Initial Fixed $100 Investment Based on: | | Net Income (loss)(5) | Transaction Value(6) | Adjusted EBITDA(6) | | | | | | | Total Shareholder Return(4) | Peer Group Total Shareholder Return(4) | | | | | 2023 | 5,753,695 | 4,857,831 | 3,753,529 | 3,131,192 | 35.00 | 178.62 | (56,555) | 593,438 | 27,121 | | 2022 | 4,952,016 | (1,285,005) | 2,123,426 | (37,672) | 31.23 | 113.16 | (72,446) | 737,514 | 22,858 | | 2021 | 1,059,848 | (28,825,351) | 1,711,239 | (3,716,106) | 48.46 | 157.59 | (8,475) | 1,018,970 | 58,167 | | 2020 | 36,121,729 | 73,005,673 | 19,523,454 | 40,775,284 | 122.63 | 117.14 | 10,562 | 815,712 | 58,074 |

  36. Indemnification of Directors and Officers

    Indemnification of Directors and Officers Our amended and restated bylaws provide that, to the fullest extent permitted by law, we will indemnify any officer or director of our company against all damages, claims and liabilities arising out of the fact that the person is or was our director or officer, or served any other enterprise at our request as a director, officer, employee, agent or fiduciary. In addition, our amended and restated certificate of incorporation provides that our directors will not be personally liable to us or our stockholders for monetary damages for breach of fiduciary duty, except as required by applicable law, as in effect from time to time. We have entered into customary indemnification agreements with our directors and officers. These agreements require us to indemnify these individuals to the fullest extent permitted under the DGCL against liabilities that may arise by reason of their service to us, and to advance expenses incurred as a result of any proceeding against them as to which they could be indemnified. There is no pending litigation or proceeding involving any of our directors or officers to which indemnification is being sought, and we are not aware of any pending litigation that may result in claims for indemnification by any director or officer.