DEF 14A of GigaCloud Technology Inc
Filed Apr 29, 2025 · FY20240001857816-25-000053
Information About Our Board of Directors
Information About Our Board of Directors
Election of Directors
Election of Directors Our board of directors currently consists of five members. Our memorandum and articles of association provide that unless otherwise determined by our company in general meeting, the number of directors shall not be less than three directors, with the exact number of directors to be determined from time to time by our board of directors. We are not subject to any contractual obligations regarding the election of our directors. Our Nominating and Corporate Governance Committee and board of directors may consider a broad range of factors relating to the qualifications and background of nominees. See “Corporate Governance—Board Qualifications and Diversity” and “Corporate Governance—Director Nominations.” The laws of the Cayman Islands and our memorandum and articles of association do not require an annual election of directors. Our memorandum and articles of association provide that our shareholders may appoint any person to be a director by means of an ordinary resolution, whilst our board of directors may appoint any person to be a director, either to fill a casual vacancy or as an addition to the existing board. Additionally, if a director is removed from office by an ordinary resolution of our shareholders, the vacancy so created may be filled by an ordinary resolution of our shareholders, or by the affirmative vote of a simple majority of the remaining directors present and voting at a board meeting.
Our Board of Directors
Our Board of Directors The following table sets forth information regarding our directors as of the date of this proxy statement.
Our Board of Directors
| Directors | Age | Position/Title | | Larry Lei Wu | 54 | Founder, chairman, director and chief executive officer | | Marshall Bernes | 81 | Director, Head of BaaS Program | | Zhiwu Chen | 63 | Independent Director | | Jan William Visser | 57 | Independent Director | | Lorri Kelley | 63 | Independent Director |
Our Board of Directors
| PROXY STATEMENT | 13 |
Director Biographies
Director Biographies The following is a brief biographical summary of the experience of our directors:
Director Biographies
| Larry Lei Wu | | Larry Lei Wu is our founder and has served as our director, chairman and chief executive officer since our inception in 2006. Prior to founding our company, among others, Mr. Wu served as the general manager of a vocational education and online education company, New Oriental Education & Technology Group Inc. (NYSE: EDU and SEHK: 9901), from 2002 to 2006. Mr. Wu received his MBA degree from Yale University in 2002 and his bachelor’s degree in mechanical manufacturing from Beijing Union University in 1994. |
Director Biographies
| Marshall Bernes | | Mr. Bernes has served as the Company’s Head of Baas Program since January 2024. Prior to joining the Company, Mr. Bernes was the founder and former chief executive officer of Noble House Home Furnishings LLC since 1988, with more than 30 years of experience in the home furnishings market. Mr. Bernes attended medical school at the New York Medical College from 1966 to 1970, and he was board certified in 1976. Mr. Bernes received his bachelor of science degree from the University of Pittsburgh in 1966. |
Non-Executive Directors (“Non-Employee Directors”)
Non-Executive Directors (“Non-Employee Directors”)
Non-Executive Directors (“Non-Employee Directors”)
| Zhiwu Chen | | Zhiwu Chen has served as our independent director since August 2022. He has been an independent director at Bairong Inc. (HKEX: 6608) since March 2021. Professor Chen has been a faculty member at the University of Hong Kong since 2016 and currently serves as director of both the Hong Kong Institute for the Humanities and Social Sciences (IHSS) and Centre for Quantitative History (CQH). Professor Chen was formerly a professor of finance at Yale University from 1999 to 2017. Professor Chen was on the board of directors at Noah Holdings (NYSE: NOAH) from December 2013 to June 2024, PetroChina Company Limited (HKSE: 857, SHSE: 601857, NYSE: PTR) from May 2011 to June 2017, Bank of Communications (SHSE: 601328) from November 2010 to August 2018, and IDG Energy Investment Ltd (HKSE: 650) from July 2015 to October 2018. Professor Chen received his PhD in financial economics from Yale University in 1990, his master’s degree in computer science from Changsha Institute of Technology in 1986 and his bachelor’s degree in computer science from Central-South University in 1983. |
Non-Executive Directors (“Non-Employee Directors”)
| 14 | GigaCloud Technology Inc |
Non-Executive Directors (“Non-Employee Directors”)
| Jan William Visser | | Jan (John) William Visser has served as our independent director since August 2023. Mr. Visser joined doTERRA International as Vice President of Global Logistics in August 2018 and he has been the Executive Vice President of Operations since May 2024 overseeing sourcing, manufacturing, logistics, fulfillment, inventory control, supply and demand planning, trade compliance and data governance. Previously, he worked at Walmart, Inc. for almost 19 years where he had various responsibilities, including his last role as a vice president leading teams to provide strategic direction, talent development, process efficiency expertise and cost reduction support to Walmart's international markets. Mr. Visser has also served on Brigham Young University’s Global Supply Chain Advisory Board since 2011. Mr. Visser received his bachelor’s degree in Spanish Translation from Brigham Young University in 1992 and his MBA from the Thunderbird School of Global Management in 1996. | | Lorri Kelley | | Lorri Kelley has served as our independent director since August 2023. Mrs. Kelley is an established business executive, and in 2018 she founded Lorri Kelley Advisors, Inc., a strategic consulting firm providing services and guidance for manufacturers, retailers and a variety of service companies throughout the home and furniture industry. She has over 30 years of experience, serving in multiple executive roles, including President of BDI Furniture, Executive Vice President of Palliser Furniture, President and Chief Operating Officer for Home Elements, Chief Commercial Officer of Handy Living and Chief Sales and Marketing Officer at UNITERS North America. Mrs. Kelley is involved in all facets of the furniture industry, serving on the board of directors for Corsicana Mattress, City of Hope, WithIt and Klaussner Furniture. She received a Marketing and Merchandising Degree from Johnson County College in 1982. |
Non-Executive Directors (“Non-Employee Directors”)
A director is not required to hold any shares in our company to qualify to serve as a director. Our board of directors may exercise all the powers of our company to raise or borrow money, and to mortgage or charge its undertaking, property and assets (present and future) and uncalled capital or any part thereof, and to issue debentures, debenture stock, bonds and other securities, whether outright or as collateral security for any debt, liability or obligation of our company or of any third party. None of our directors has a service contract with us or any of our subsidiaries that provides for benefits upon termination of service.
Director Compensation
Director Compensation Our employees who also serve as directors do not receive additional compensation for their service as directors. Our non-employee director compensation program provides for annual retainer fees and/or long-term equity awards for our non-employee directors. Our Compensation Committee assessed our non-employee director compensation program in 2024, and, based on a recommendation from our Compensation Committee, our Board of Directors approved a revision to our non-employee director compensation program in August 2024, which included (i) an increase in the annual retainer from $50,000 in cash to $66,000 in cash, and (ii) an increase in share awards from $100,000 to $114,000 in our Class A ordinary shares, par value $0.05 per share, for each 12 month term. The increase in 2024 was primarily to adjust for the increased workload required to serve on our Board as the size, scope, and complexity of the Company also increased.
Director Compensation Table
Director Compensation Table The following table provides information regarding compensation paid to each of our non-employee directors for the fiscal year ended December 31, 2024.
Director Compensation Table
| Name | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(2) | Option Awards ($) | Non-Equity Incentive Plan Compensation ($) | Nonqualified Deferred Compensation Earnings ($) | All Other Compensation ($) | Total ($) | | Zhiwu Chen | $58,000 | $103,500 | $— | $— | $— | $— | $161,500 | | Jan William Visser | $58,000 | $103,500 | $— | $— | $— | $— | $161,500 | | Lorri Kelley | $58,000 | $103,500 | $— | $— | $— | $— | $161,500 | | Frank Lin(3) | $— | $— | $— | $— | $— | $— | $— |
Director Compensation Table
(1)Represents the aggregate dollar amount of all fees earned or paid in cash for services as a director, including annual retainer fees. (2)The amounts reported represent the aggregate grant date fair value of fully vested share awards upon grant during the applicable year, calculated in accordance FASB ASC Topic 718. The assumptions used in calculating the grant date fair value of the awards reported in this column are set forth in Note 15 to our audited financial statements in the 2024 Annual Report. The amounts reported in this column reflect the accounting cost for the share awards. (3)Mr. Lin has served as our director since November 2006 and resigned from our Board of Director in November 2024. There were no unvested restricted share units held by our non-employee directors as of December 31, 2024. We have entered into indemnification agreements with each of our directors. Under these agreements, we agree to indemnify our directors against all liabilities and expenses incurred by such persons in connection with claims made by reason of their being a director of our company to the fullest extent permitted by law with certain limited exceptions.
Director Compensation Table
| PROXY STATEMENT | 17 |
Compensation Discussion and Analysis
Compensation Discussion and Analysis This Compensation Discussion and Analysis, or CD&A, section provides an overview and analysis of the material components of our compensation program for our Named Executive Officers identified below. Our compensation program is designed to align executive pay with measurable results intended to create value for shareholders, and utilize compensation as a tool to assist us in attracting and retaining the high-caliber executives that we believe are critical to our long-term success. We believe that the key to our success is the long-term shareholder value that is created by our employees. Our compensation philosophy is weighted towards providing equity awards, and we believe this helps to retain our executives and aligns their interests with those of our shareholders by allowing them to participate in the longer-term success of our company as reflected in share price appreciation. For example, we provide many of our employees, including our Named Executive Officers, with an equity award, which we believe motivates the employee to think of themselves as an owner of our company. Unless stated otherwise, amounts in this CD&A are presented in U.S. dollars, except for the amounts reported for Mr. Lau below which were paid in Hong Kong dollars, or HK$, and have been converted into and presented in U.S. dollars at the rate of HK$7.7677 to US$1.00 for 2024 data, HK$7.8109 to US$1.00 for 2023 data and HK$7.8015 to US$1.00 for 2022 data, being the noon buying exchange rates in effect as of December 31, 2024, 2023 and 2022, respectively, as set forth in the H.10 statistical release of The Board of Governors of the Federal Reserve System.
Monthly and Annual Cash Incentive Compensation
Monthly and Annual Cash Incentive Compensation We provide achievement cash awards in recognition of the accomplishments of our executive officers overseeing the performance of the whole Company. These cash awards are based on objective performance criteria and are non-discretionary. In addition to their base salary, Mr. Wu, Mr. Hao, Mr. Wan and Mr. Schrock
Monthly and Annual Cash Incentive Compensation
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Monthly and Annual Cash Incentive Compensation
are eligible to participate in our cash incentive program, which is designed to provide appropriate incentives to them based on achievement of performance goals to promote and reward the achievement of key short-term strategic and our business goals as well as individual performance. The cash award to each of Mr. Wu, Mr. Hao and Mr. Wan is determined based on their achievement of meeting certain Company-wide performance targets or specific business operation targets. Mr. Schrock’s cash award is determined based on his achievement on a project-by-project basis. The amounts that Mr. Wu, Mr. Hao, Mr. Wan and Mr. Schrock earned pursuant to the performance-based awards program are non-discretionary and are reported in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table. Our Compensation Committee reviewed and approved the cash incentive program for fiscal year 2024 for our Chief Executive Officer, Chief Operating Officer and Chief Technology Officer based on company-wide performance goal, as well as cash incentive program to our President based on project-by-project performance. Payouts under the company-wide performance plan is payable on a monthly basis as targets are measured every month, while the payouts under the project-by-project plan is dependent on the completion of such projects. The payouts on the company-wide performance plan may start from 0% to an unlimited maximum amount of the target payout, based on the following formula:
Target Bonus Opportunity x Company Performance Goal x Individual Modifier = 2024 Cash Payout
Target Bonus Opportunity x Company Performance Goal x Individual Modifier = 2024 Cash Payout •Target Bonus Opportunity. The target bonus include a baseline amount, adjusted by the actual performance against the target set for the Company Performance Goal described below (the “Target Bonus Opportunity”). The baseline amount is adjusted upward or downward by a fixed percentage, depending on whether actual performance exceeds or falls below the target. As the baseline amount can be adjusted either downward or upward, it may be zero if the actual performance is significantly lowered than the target, and there is no maximum if the actual performance is significantly higher than the target. •Company Performance Goal. The Company Performance Goal for fiscal year 2024 were 1P profit and GigaCloud Marketplace GMV. 1P profit means the non-GAAP profit incurred by our internal business units related to the sale of our 1P inventory. GigaCloud Marketplace GMV is the total gross merchandise value of transactions ordered through our GigaCloud Marketplace including GigaCloud 3P and GigaCloud 1P, before any deductions of value added tax, goods and services tax, shipping charges paid by buyers to sellers and any refunds. •Individual Modifier. For our Chief Executive Officer, the actual cash payout will be equaled to the target bonus calculated in the aforementioned formula multiple by a guaranteed fixed ratio. For our Chief Operating Officer and our Chief Technology Officer, the actual cash payout will be equaled to the target bonus calculated in the aforementioned formula and further adjusted upward or downward by a fixed ratio, depending on the overall management evaluation for the fiscal year made by the senior management and the Chief Executive Officer. •At the end of the fiscal year, an additional one-time award is granted for meeting the annual Company performance goal.
Target Bonus Opportunity x Company Performance Goal x Individual Modifier = 2024 Cash Payout
| PROXY STATEMENT | 31 |
Target Bonus Opportunity x Company Performance Goal x Individual Modifier = 2024 Cash Payout
With the assistance of our management's input, our Compensation Committee reviews and approves rigorous performance metrics and set achievement levels for those metrics in a manner that is challenging to attain. We are not disclosing the actual target figures for 1P profit and GigaCloud Marketplace GMV as these amounts represent confidential financial and operational information, the disclosure of which would result in competitive harm to our business. In 2024, each of our Named Executive Officers who was eligible for cash awards generally successfully achieved the company performance goals or targets.
Equity-Based Incentive Awards
Equity-Based Incentive Awards Our equity-based incentive awards are designed to align our interests and those of our shareholders with those of our employees, including our executive officers. Our Compensation Committee is responsible for approving equity grants. The magnitudes of equity awards granted to our Named Executive Officers were based on a pre-determined fixed pool of equity awards to be issued to all eligible employees for the fiscal year, taking into account the Company's share prices, the Company's overall financial performance, historical awards and other macroeconomic factors. The pool will be furthered allocated to eligible employees, including our Named Executive Officers, based on individual's performance for the fiscal year. Except for our Chief Financial Officer, our Named Executive Officers do not necessarily receive equity award on an annual basis. Therefore, an Named Executive Officer's compensation, as reported in the Summary Compensation Table, may fluctuate materially from year to year depending on whether a grant was made in a particular year. In 2024, our Compensation Committee determined that granting of restricted share units (“RSUs”) would encourage retention and also align the interest of our Named Executive Officers to those of our shareholders, providing opportunities for our Named Executive Officers to benefit from future successes in our Company through the appreciation of the value of their equity-awards. The equity awards granted to our employees are typically vested on two schedules: (a) 50% of the equity awards are vested immediately and 50% of the equity awards are subject to 12-month service condition; and (b) 100% of the equity awards are vested immediately upon grant. The RSUs vested are immediately settled in the Company's Class A ordinary shares. We believe such tailored vesting schedule reflects the need to align the interests of these executives with the long-term success of the Company, encouraging sustained performance and commitment to our strategic goals. For our Chief Financial Officer, because the responsibilities and performance cannot be directly tied to a specific revenue generating business or operation function, an annual equity awards equivalent to the amount of $100,000 will be granted. This award will be granted and vested upon the fulfillment of the service condition for each 12-month period, as stipulated in the employment agreement. Equity awards to our Named Executive Officers (including grant amounts and vesting schedules) are determined at the Compensation Committee’s discretion after taking into account other direct compensation elements, the recommendations of our Chief Executive Officer regarding the Named Executive Officers (excluding the Chief Executive Officer) and the landscape in which we compete for executive talent. Although we do not have a formal policy on when equity awards will be granted, we typically grant equity awards to our employees, including our Named Executive Officers, in the second quarter of the fiscal year. In 2024, our Compensation Committee granted the following RSUs awards to our Named Executive Officers:
Equity-Based Incentive Awards
| 32 | GigaCloud Technology Inc |
Equity-Based Incentive Awards
| Named Executive Officers | Number of RSUs Granted (#) | | Larry Lei Wu | 100,000 | | Erica Xiaoyang Wei | 6,000 | | Xinyan Hao | 25,000 | | Xin Wan | 20,000 | | Iman Schrock | 10,000 | | David Kwok Hei Lau(1) | 36,917 |
Equity-Based Incentive Awards
(1)In connection with Mr. Lau's separation, 8,917 RSUs were granted and vested as of September 26, 2024.
Pension and Non-qualified Deferred Compensation Plans
Pension and Non-qualified Deferred Compensation Plans Our Named Executive Officers do not participate in any pension or non-qualified deferred compensation plans and received no pension benefits or non-qualified deferred compensation during the fiscal year ended December 31, 2024.
Summary Compensation Table
Summary Compensation Table The following table presents summary information regarding the total compensation that was awarded to, earned by or paid to the Named Executive Officers for services rendered during the years ended December 31, 2024, 2023 and 2022.
Summary Compensation Table
| Name and Principal Position | Year | Salary ($)(1) | Stock Awards ($)(2) | Non-Equity Incentive Plan Compensation ($)(3) | All Other Compensation ($)(4) | Total ($) | | Larry Lei Wu, Chief Executive Officer(5) | 2024 | $162,000 | $3,102,000 | $214,710 | $2,317 | $3,481,027 | | | 2023 | $162,000 | $— | $122,862 | $2,304 | $287,166 | | | 2022 | $142,000 | $— | $18,860 | $2,237 | $163,097 | | Erica Xiaoyang Wei, Chief Financial Officer(6) | 2024 | $272,432 | $184,740 | $— | $— | $457,172 | | | 2023 | $— | $— | $— | $— | $— | | | 2022 | $— | $— | $— | $— | $— | | Xinyan Hao, Chief Operating Officer | 2024 | $58,333 | $775,500 | $173,117 | $2,317 | $1,009,267 | | | 2023 | $58,333 | $141,668 | $221,225 | $1,728 | $422,955 | | | 2022 | $58,333 | $— | $65,492 | $— | $123,825 | | Xin Wan, Chief Technology Officer | 2024 | $58,333 | $620,400 | $169,682 | $1,891 | $850,306 | | | 2023 | $58,333 | $— | $221,000 | $2,155 | $281,488 | | | 2022 | $58,333 | $300,000 | $84,472 | $1,346 | $444,150 | | Iman Schrock, President(7) | 2024 | $311,527 | $310,200 | $50,000 | $— | $671,727 | | | 2023 | $304,802 | $194,900 | $50,000 | $— | $549,702 | | | 2022 | $152,981 | $— | $— | $— | $152,981 | | David Kwok Hei Lau, Former Chief Financial Officer(8)(9) | 2024 | $230,184 | $1,062,416 | $— | $1,738 | $1,294,338 | | | 2023 | $307,263 | $163,768 | $— | $2,304 | $473,335 | | | 2022 | $233,288 | $— | $— | $1,346 | $234,634 |
Summary Compensation Table
(1)Dollar value of base salary earned during the applicable fiscal year, including accrued but unused vacation time. (2)The amounts reported in the “Stock Awards” column represent the aggregate grant date fair value of fully vested stock awards upon grant during the applicable year, calculated in accordance with Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or ASC, Topic 718. The assumptions used in calculating the grant date fair value of the awards reported in this column are set forth in Note 13 to our audited financial statements in the 2024 Annual Report. The amounts reported in this column reflect the accounting cost for the stock awards. (3)Amounts reflect non-discretionary cash awards for meeting certain Company-wide performance targets earned by Mr. Wu, Mr. Hao and Mr. Wan, and project-by-project performance based cash awards earned by Mr. Schrock. (4)Amounts reflect monthly contributions made by us pursuant to the Hong Kong Mandatory Provident Fund Schemes Ordinance to the mandatory provident fund scheme on behalf of certain executives. Such amounts was made by us pursuant to the Hong Kong Mandatory Provident Fund Schemes Ordinance to the mandatory provident fund scheme only. These amounts were paid in HK$ and converted into and presented in U.S. dollars at the rate of HK$7.7677 to US$1.00 for 2024 data, as set forth in the H.10 statistical release of The Board of Governors of the Federal Reserve System. (5)Mr. Wu's annual base salary rate was adjusted in May 2022 to $162,000 and remained at $162,000 in 2023 and 2024, respectively. (6)Ms. Wei was appointed as Interim Chief Financial Officer in August 2024 and her annual salary was increased to $307,765 to reflect the appointment. (7)Mr. Schrock joined us as our President in July 2022, and therefore the salary amount set forth in the table above reflects the amount earned for the portion of 2022 in which he was employed by us. Mr. Schrock had an annual base salary rate of $300,000 in 2024. (8)For purposes of this table, amounts reported for Mr. Lau were paid in HK$ and were converted into and presented in U.S. dollars at the rate of HK$7.7677 to US$1.00 for 2024 data, as set forth in the H.10 statistical release of The Board of Governors of the Federal Reserve System. (9)Mr. Lau joined us as our Chief Financial Officer in May 2022 and separated from service effective September 19, 2024 and therefore the salary amount set forth in the table above reflects the amount earned for the portion of 2024 and 2022 in which he was employed by us. Mr. Lau had an annual base salary rate of $308,972 (HK$2,400,000) in 2024.
Summary Compensation Table
| PROXY STATEMENT | 35 |
Grants of Plan-Based Awards
Grants of Plan-Based Awards
Grants of Plan-Based Awards
| | | | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(1) | | | | Estimated Future Payouts Under Equity Incentive Plan Awards(2) | | | | | | All Other Stock Awards: Number of Shares of Stock or Units (#) | | Grant Date Fair Value of Stock and Option Awards ($)(3) | | Name | Type of Award | Grant Date | Threshold ($) | Target ($) | Maximum ($) | | Threshold (#) | | Target (#) | | Maximum (#) | | | | | | Larry Lei Wu | Cash Incentive | — | — | $213,719 | — | | — | | — | | — | | — | | — | | | RSUs | April 10, 2024 | — | — | — | | — | | — | | — | | 100,000 | | $3,102,000 | | Erica Xiaoyang Wei | Cash Incentive | — | — | — | — | | — | | — | | — | | — | | — | | | RSUs | April 1, 2024 | — | — | — | | — | | — | | — | | 6,000 | | $184,740 | | Xinyan Hao | Cash Incentive | — | — | $142,479 | — | — | — | — | — | — | — | — | — | — | — | | | RSUs | April 10, 2024 | — | — | — | | — | | — | | — | | 25,000 | | $775,500 | | Xin Wan | Cash Incentive | — | — | $142,479 | — | — | — | — | — | — | — | — | — | — | — | | | RSUs | April 10, 2024 | — | — | — | | — | | — | | — | | 20,000 | | $620,400 | | Iman Schrock | Cash Incentive | — | — | $50,000 | — | — | — | | — | | — | — | — | | — | | | RSUs | April 10, 2024 | — | — | — | | — | | — | | — | | 10,000 | | $310,200 | | David Kwok Hei Lau | Cash Incentive | — | — | — | — | | — | | — | | — | | — | | — | | | RSUs | April 10, 2024 | — | — | — | | — | | — | | — | | 28,000 | | $868,560 | | | RSUs | September 26, 2024 | — | — | — | | — | | — | | — | | 8,917 | | $193,856 |
Grants of Plan-Based Awards
(1)The amounts in these columns represent the threshold, target and maximum amounts of potential annual cash incentive awards that may be earned by our Named Executive Officers during fiscal year 2024. The actual payouts earned under the cash component are reflected in the “Non-equity incentive plan compensation” column of the “Summary Compensation Table” (2)We do not provide for additional payout under our equity incentive plan awards. (3)Represents the grant date fair value of the award as computed in accordance with FASB ASC Topic 718. The assumptions used in calculating the grant date fair value of the awards reported in this column are set forth in Note 13 to our audited financial statements in the 2024 Annual Report. The amounts reported in this column reflect the accounting cost for the share awards.
Grants of Plan-Based Awards
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Outstanding Equity Awards at Fiscal Year-End
Outstanding Equity Awards at Fiscal Year-End The following table presents summary information regarding the outstanding equity awards held by each of the Named Executive Officers as of December 31, 2024. None of our Named Executive Officers held any options to purchase our Class A ordinary shares or other securities as of December 31, 2024.
Outstanding Equity Awards at Fiscal Year-End
| | | Share Awards | | | | | Name | Grant Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | 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 ($) | | Larry Lei Wu | — | — | — | — | — | | Erica Xiaoyang Wei | — | — | — | — | — | | Xinyan Hao | April 10, 2024 | 12,500(1) | 231,500 | — | — | | Xin Wan | April 10, 2024 | 10,000(1) | 185,200 | — | — | | Iman Schrock | — | — | — | — | — | | David Kwok Hei Lau | — | — | — | — | — |
Outstanding Equity Awards at Fiscal Year-End
(1)These RSUs, which were granted on April 10, 2024, vest upon the satisfaction of a service condition. 50% of the RSUs are vested immediately on the grant date and 50% of the RSUs vest in 12 months after the grant date.
Option Exercises and Stock Vested
Option Exercises and Stock Vested The following table presents summary information regarding the vesting during 2024 of RSUs previously granted to the Named Executive Officers. Our Named Executive Officers do not hold any stock options.
Option Exercises and Stock Vested
| | Stock Awards | | | Name | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($)(1) | | Larry Lei Wu | 100,000 | $3,102,000 | | Erica Xiaoyang Wei | 6,000 | $184,740 | | Xinyan Hao | 26,638 | $887,528 | | Xin Wan | 10,000 | $310,200 | | Iman Schrock | 10,000 | $310,200 | | David Kwok Hei Lau | 36,917 | $1,062,416 |
Option Exercises and Stock Vested
(1)“Value Realized on Vesting” is calculated by multiplying the number of shares vested by the market value of our Class A ordinary shares on the date when the shares are granted and vested.
Potential Payments upon Termination or Change in Control
Potential Payments upon Termination or Change in Control Pursuant to the employment agreements with our Named Executive Officers, if we terminate their employment without cause (as defined in the employment agreements) or if they resign for good reason (as defined in the employment agreements), we shall (i) continue to pay and otherwise provide to each of our Named Executive Officers, during the relevant notice period (as defined below), all compensation, base salary and previously earned but unpaid incentive compensation, if any, and shall continue to allow them to participate in any benefit plans in accordance with the terms of such plans during such notice period; and (ii) pay to them any such amount as may be agreed between us and our Named Executive Officers. The relevant notice period means 30 days’ notice for a termination by us without cause and 60 day’s notice for a termination by the Named Executive Officer with good reason. Regular salary will be paid during the notice period. The employment agreements contain standard confidentiality provisions, effective during and after their employment with us, as well as noncompetition and nonsolicitation restrictive covenants, effective during the two-years following the termination of their employment with us. Except as mentioned above, we do not have any other contract, agreement, plan or arrangement, whether written or unwritten, that provides for payment(s) to a Named Executive Officer at, following, or in connection with the resignation, retirement or other termination of a Named Executive Officer, or a change in control of the company or a change in the Named Executive Officer’s responsibilities following a change in control, with respect to each Named Executive Officer.
Potential Payments upon Termination or Change in Control
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CEO Pay Ratio
CEO Pay Ratio In accordance with the requirements of Section 953(b) of the Dodd-Frank Act and Item 402(u) of Regulation S-K (which we collectively refer to as the “Pay Ratio Rule”), we are providing disclosure regarding the ratio of the annual total compensation of our Chief Executive Officer to that of our median employee. This pay ratio represents our reasonable estimate calculated in a manner consistent with the Pay Ratio Rule and applicable guidance, which provide flexibility in how companies identify the median employee. Each company may use a different methodology and make different assumptions particular to that company. As a result, and as explained by the SEC when it adopted this rule, in considering the pay ratio disclosure, shareholders should keep in mind that the rule was not designed to facilitate comparisons of pay ratios among different companies, even companies within the same industry, but rather to allow shareholders to better understand and assess each particular company’s compensation practices and pay ratio disclosures.
Pay Ratio
Pay Ratio For 2024, the annual total compensation of our Chief Executive Officer was $3,481,027, the annual total compensation of our median employee was $24,855, and the ratio of these two amounts was 140 to 1. We believe that this ratio is a reasonable estimate calculated in a manner consistent with the requirements of the Pay Ratio Rule.
Pay Versus Performance
Pay Versus Performance In accordance with the requirements of Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(v) of Regulation S-K, we are providing the following disclosure regarding executive compensation for our Chief Executive Officer (also referred to as principal executive officer, or “PEO”) and our other Named Executive Officers (“Non-PEO NEOs”) for the fiscal years listed below. For more information concerning our pay-for-performance philosophy and how we structure our executive compensation to drive and reward performance, see the section titled “Compensation Discussion and Analysis.” The information contained in this Pay Versus Performance section will not be incorporated into any of the Company’s filings under the Securities Act or the Exchange Act, except to the extent the Company specifically incorporates such information by reference therein.
Pay Versus Performance
| | | | | | Value of Initial Fixed $100 Investment Based on: | | | | | Year | Summary Compensation Table Total for PEO ($)(1) | Compensation Actually Paid to PEO ($)(2) | Average Summary Compensation Table Total for Non-PEO NEOs ($)(3) | Average Compensation Actually Paid to Non-PEO NEOs ($)(4) | Total Shareholder Return ($) | Peer Group Total Shareholder Return ($)(5) | Net Income ($ in thousands) | Total Revenues ($ in thousands)(6) | | 2024 | $3,481,027 | $3,481,027 | $747,118 | $737,069 | 118.04 | 177.16 | $125,808 | $1,161,042 | | 2023 | $287,166 | $287,166 | $431,870 | $478,843 | 116.60 | 128.06 | $94,108 | $703,831 | | 2022 | $163,097 | $163,097 | $238,898 | $238,898 | 36.27 | 82.14 | $23,972 | $490,071 |
Pay Versus Performance
(1)Mr. Larry Lei Wu was the PEO for each of the years in the table. (2)For each year, the amount shown in Compensation Actually Paid to PEO in the table above equals the Summary Compensation Table Total for PEO because all equity awards granted to our PEO were vested immediately upon grant, and therefore there are no outstanding and unvested equity awards for our PEO. (3)The individuals comprising our Non-PEO NEOs for 2024 were Ms. Erica Xiaoyang Wei, Mr. Xinyan Hao, Mr. Xin Wan and Mr. Iman Schrock. The individuals comprising our Non-PEO NEOs for each of 2023 and 2022 were Mr. David Kwok Hei Lau, Mr. Xinyan Hao, Mr. Xin Wan and Mr. Iman Schrock. (4)Average Compensation Actually Paid to our Non-PEO NEOs in the table above reflects the following adjustments from the Summary Compensation Table for the years set forth in the table below. The amounts shown for average Compensation Actually Paid to our non-PEO NEOs have been calculated in accordance with Item 402(v) of Regulation S-K and do not reflect compensation actually earned, realized or received by our non-PEO NEOs during the applicable year.
Pay Versus Performance
| | Non-PEO NEOs | | | | | 2024 | 2023 | 2022 | | Average Summary Compensation Total | $747,118 | $431,870 | $238,898 | | Less: Grant Date Fair Value of Stock Awards Granted in Current Year | $472,710 | $125,084 | $75,000 | | Plus: Fair Value of Stock Awards Granted in Current Year and Unvested as of Year End | $104,175 | $64,681 | $— | | Plus: Change in Fair Value from Prior Year End to Current Year End of Outstanding and Unvested Stock Awards Granted in Prior Fiscal Years | $— | $— | $— | | Plus: Change in Fair Value from Prior Year End to Vesting Date of Vested Awards Granted in Prior Years | $60,263 | $— | $— | | Plus: Fair Value at Vesting Date of Vested Awards Granted in Current Year | $298,223 | $107,376 | $75,000 | | Average Compensation Actually Paid | $737,069 | $478,843 | $238,898 |
Pay Versus Performance
(5)For purposes of calculating the Peer Group Total Shareholder Return (“TSR”), we utilized the Dow Jones Internet Commerce Index, which we also utilize in the stock performance graph required by Item 201(e) of Regulation S-K included in the 2024 Annual Report. The comparison assumes $100 was invested in the Company's Class A ordinary shares for the period starting August 18, 2022, the first day the Company’s Class A ordinary shares began trading on the Nasdaq Global Market through the end of the fiscal year. Historical stock performance is not necessarily indicative of future stock performance.
Pay Versus Performance
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Pay Versus Performance
(6)Total revenues is the company-selected financial measure from the list of the most important performance measures used to link compensation actually paid to our PEO and other Non-PEO NEOs to our Company’s performance.
Description of the relationships between executive compensation actually paid and metrics on the pay versus performance table
Description of the relationships between executive compensation actually paid and metrics on the pay versus performance table The following graph reflects the relationship between the compensation actually paid for our PEO and for the average of our other Non-PEO NEOs as calculated in accordance with Item 402(v) of Regulation S-K, our Total Shareholder Return, and the Peer Group TSR of the Dow Jones Internet Commerce Index over the applicable measurement period. The following graph reflects the relationship between the compensation actually paid for our PEO and for the average of our other Non-PEO NEOs as calculated in accordance with Item 402(v) of Regulation S-K, and our net income calculated in accordance with GAAP over the applicable measurement period:
Description of the relationships between executive compensation actually paid and metrics on the pay versus performance table
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Description of the relationships between executive compensation actually paid and metrics on the pay versus performance table
The following graph reflects the relationship between the compensation actually paid for our PEO and for the average of our other Non-PEO NEOs as calculated in accordance with Item 402(v) of Regulation S-K, and Walmart’s net sales calculated in accordance with GAAP over the applicable measurement period:
Description of the relationships between executive compensation actually paid and metrics on the pay versus performance table
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Indemnification of Directors and Executive Officers
Indemnification of Directors and Executive Officers Cayman Islands law does not limit the extent to which a company’s memorandum and articles of association may provide for indemnification of officers and directors, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public policy, such as providing indemnification against civil fraud or the consequences of committing a crime. Our memorandum and articles of association provide that each of our directors shall be indemnified against all actions, proceedings, costs, charges, expenses, losses, damages or liabilities incurred or sustained by such director, other than by reason of such director’s own dishonesty, willful default or fraud, in or about the conduct of our company’s business or affairs (including as a result of any mistake of judgment) or in the execution or discharge of his duties, powers, authorities or discretion, including any costs, expenses, losses or liabilities incurred by such director in defending (whether successfully or otherwise) any civil proceedings concerning our company or our affairs in any court whether in the Cayman Islands or elsewhere. This standard of conduct is generally the same as permitted under the Delaware General Corporation Law for a Delaware corporation. In addition, we have entered into indemnification agreements with each of our directors and executive officers, including the Named Executive Officers, that provide such persons with additional indemnification beyond that provided in our memorandum and articles of association. Under these agreements, we agree to indemnify our directors and executive officers against all liabilities and expenses incurred by such persons in connection with claims made by reason of their being a director or officer of our company to the fullest extent permitted by law with certain limited exceptions. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers or persons controlling us under the foregoing provisions, we have been informed that in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.
How do I recommend a director nominee?
How do I recommend a director nominee? Under Cayman Islands law, shareholders do not have the right to nominate a person for election as a director directly. However, if shareholders submit information about a potential candidate for the board to our Nominating and Corporate Governance Committee, our Nominating and Corporate Governance Committee will consider whether they are appropriate for nomination to our board. The ultimate decision as to whether or not to propose a potential candidate for election shall be at the sole and absolute discretion of our board of directors.
How do I recommend a director nominee?
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