Table of ContentsUNITED STATES
SECURITIES AND EXCHANGE COMMISSION
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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____________________ |
FORM 10‑K/A
Amendment No. 1
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(Mark One) |
x☒ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended December 31, 2019
| For the fiscal year ended December 31, 2014 |
| Or |
¨☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 |
Commission file number: 001-33520 |
COMSCORE, INC. |
(Exact name of registrant as specified in its charter) |
Delaware | 54-1955550 |
(State or other jurisdiction of
incorporation or organization) | (I.R.S. Employer
Identification Number) |
11950 Democracy Drive, Suite 600
Reston, Virginia 20190
(Address of principal executive offices)
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(703) 438-2000 |
(Registrant’s telephone number, including area code) |
Securities registered pursuant to Section 12(b) of the Act: FOR THE TRANSITION PERIOD FROM TO |
Commission File Number001-33520
(Exact Name of Registrant as Specified in its Charter)
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| | |
| | |
(State or Other Jurisdiction of
Incorporation or Organization) | | (I.R.S. Employer
Identification Number) |
11950 Democracy Drive, Suite 600
(Address of Principal Executive Offices)
(Registrant’s Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act:
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Title of Each Class:Class | | | | Name of Each Exchange on whichWhich Registered |
Common Stock, par value $0.001 per share | | The | | NASDAQ StockGlobal Select Market LLC |
Securities registered pursuant to Section 12(g) of the Act: None.
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes x☐
No ¨☒
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ¨☐
No x☒
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files) Yes x No ¨
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x☒
No ¨☐
Indicate by check mark if disclosure of delinquent filerswhether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to ItemRule 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III S-T
(§ 232.405 of this Form 10-K or any amendmentchapter) during the preceding 12 months (or for such shorter period that the registrant was required to this Form 10-K. ¨submit such files). Yes ☒
No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated
filer,
or a smaller reporting
company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”
and, “smaller reporting
company,” and “emerging growth company” in Rule
12b-2
of the Exchange Act. | | | | | | |
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| | | | | | |
| | | | Smaller reporting company | | ☐ |
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| | | | | | ☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
(Check one):☐
Large accelerated filer x Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2
of the Exchange Act). Yes ¨☐ No x☒
The aggregate market value of the registrant’s voting and
non-voting
common equity held by
non-affiliates
of the registrant,
onas of June
30, 2014,28, 2019, the last business day of the registrant’s most recently completed second fiscal quarter, was approximately
$1,210.9$220.3 million (based on the closing
sales price of the registrant’s common stock
as reported byon the
NASDAQNasdaq Global Select Market on that date).
SharesSolely for purposes of this disclosure, shares of the registrant’s common stock held by
each officerexecutive officers and
directordirectors and each person who
owns more thanowned 10% or more of the outstanding common stock of the registrant have been excluded in that such persons may be deemed to be affiliates. This determination of affiliate status is not necessarily a conclusive determination for other purposes.
Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date: As of April 23, 2015,2020, there were 40,512,31970,208,183
shares of the registrant’s common stock outstanding.
_____________________________
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DOCUMENTS INCORPORATED BY REFERENCE |
None. |
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EXPLANATORY NOTE
Explanatory Note
On February 28, 2020, comScore, Inc. (the “company,” “Comscore,” “we,” “us” or “our”) filed its Annual Report on Form 10-K
for the fiscal year ended December 31, 2019 (the “Original10-K”).
This Amendment No. 1
on Form 10-K/A (this(the “Amendment”) amends
comScore, Inc.’s Annual ReportPart II, Item 9B of the Original 10-K to disclose the recent resignation of a member of the Company’s Board of Directors, and amends Part III, Items 10 through 14 of the Original10-K
to include information previously omitted from the Original10-K
in reliance on
General Instruction G(3) to Form
10-K.
General Instruction G(3) to Form 10-K for
provides that registrants may incorporate by reference certain information from a definitive proxy statement which involves the
year ended December 31, 2014, originallyelection of directors if such definitive proxy statement is filed with the Securities and Exchange Commission
or SEC, on February 20, 2015 (the
“Original Filing”“SEC”)
. We are amending and refiling Part III to include information required by Items 10, 11, 12, 13 and 14 because our definitive proxy statement will not be filed within 120 days after
December 31, 2014, the end of the fiscal
year covered byyear. We do not anticipate that our
Annual Report on Form 10-K. Accordingly, reference to ourdefinitive proxy statement
oninvolving the
cover page has been deleted. In addition, pursuant toelection of directors will be filed before April 29, 2020 (i.e., within 120 days after the
rulesend of our 2019 fiscal year). Accordingly, Part III of the
SEC, we have alsoOriginal10-K
is hereby amended and restated as set forth below. The information included
herein as
exhibits currently dated certifications required
under Section 302 of The Sarbanes-Oxley Act of 2002. Because no financial statements are contained within this Amendment, we are not including certifications pursuant to Section 906 of The Sarbanes-Oxley Act of 2002. We are amending and refiling Part IV to reflect the inclusion of those certifications.Except as described above, no other changes have been made to the Original Filing. Except as otherwise indicated herein, this Amendment continues to speak as of the date of the Original Filing, and we have not updated the disclosures contained therein to reflect any events that occurred subsequent to the date of the Original Filing. The filing of this Annual Report on Form 10-K/A is not a representation that any statements contained in items of our Annual Report on Form 10-K other thanby Part III, Items 10 through 14
of Form 10-K
is more limited than what is required to be included in the definitive proxy statement to be filed in connection with our annual meeting of shareholders.In addition, as required by Rule 12b-15
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), new certifications by our principal executive officer and
principal financial officer are filed as exhibits to this Amendment under Item 15 of Part IV
are truehereof. Except as stated herein, this Amendment does not reflect events occurring after the filing of the Original10-K
with the SEC on February 28, 2020 and no attempt has been made in this Amendment to modify or
completeupdate other disclosures as
of any date subsequent topresented in the Original
Filing.10-K.
COMSCORE, INC.
AMENDMENT NO. 1
to
ANNUAL REPORT ON FORM
10-K/A
FOR THE PERIOD ENDED DECEMBER 31, 20142019
TABLE OF CONTENTS
On April 28, 2020, Joanne Bradford, a Class III member of our Board of Directors, notified us of her resignation as a director, effective April 30, 2020. Ms. Bradford’s resignation was due to other professional commitments following the acquisition of her employer, Honey Science Corp., by PayPal in January 2020. Her resignation was not because of any disagreement with the company known to an executive officer of the company on any matter relating to our operations, policies or practices.
| ITEM 10. | DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE |
Directors and Executive Officers
The names of our directors and executive officers and their ages, positions and biographies are set forth below. Also included for our directors is information regarding their service on other public company boards, and their specific experience, qualifications, attributes or skills that led to the conclusion that each director should serve on our Board of Directors (“Board”). This information is as of April 24, 2020.
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PART IV | 39 |
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| | Item 15. Exhibits, Financial Statement Schedules | 45 |
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Executive Officers and Executive Director | |
SIGNATURES | 48 |
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PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth the names and ages of our executive officers and directors as of April 24, 2015:
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Name | Age | Position |
Serge Matta | 40 | President, | | Chief Executive Officer, Executive Vice Chairman and Class II Director |
Magid M. Abraham, Ph.D. | 56 | Executive | | | | Chief Legal and Compliance Officer |
| | | | | | Chief Financial Officer and Treasurer |
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| | | | | | |
| | | | | | Chairman of the Board of Directorsand Class II Director |
Gian M. FulgoniJoanne Bradford (1)(2)(3) | 67 | Chairman Emeritus and | | | | |
Melvin Wesley III | 43 | Chief Financial Officer | | | | |
Cameron Meierhoefer | 43 | Chief Operating Officer | | | | |
Christiana L. Lin | 45 | Executive Vice President, General Counsel and Chief Privacy Officer | | | | |
Michael A. Brown | 45 | Chief Technology Officer |
Russell Fradin(1)(2) | 38 | Director |
William J. Henderson(1)(2)(3) | 67 | |
William Katz(1)(2) | 60 | Director |
Ronald J. Korn(3) | 75 | Director |
Joan M. Lewis(3) | 49 | Director |
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| (1) | Member of Nominating and Governance Committee |
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| (2) | Member of Compensation Committee |
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| (3) | Member of Audit Committee |
Executive Officers and Executive DirectorsDirector
Serge Mattahas served as a member of our Board of Directors since April 2014, as our Chief Executive Officer since March 2014November 2019 and as our Vice Chairman since January 2016. He was our President since June 2013. Fromfrom January 2016 through May 2012 to June 2013,2018. Mr. MattaLivek previously served as President, Commercial Solutions. From March 2012Vice Chairman and Chief Executive Officer of Rentrak Corporation, a media measurement and consumer targeting company, from June 2009 until our merger with Rentrak in January 2016. Prior to May 2012, he served as President, MobileRentrak, Mr. Livek was founder and Operator SolutionsChief Executive Officer of Symmetrical Capital, an investment and prior to that, from January 2010 to March 2012, Executiveconsulting firm; Senior Vice President, overseeing our worldwide TelecommunicationsStrategic Alliances and Mobile practice. Prior to joining the Company in 2000, Mr. Matta held positions at MicroStrategy within the consulting group. Mr. MattaInternational Expansion, of Experian Information Solutions, Inc., a provider of information, analytical and marketing services; andco-President
of Experian’s subsidiary Experian Research Services. He holds a B.S. degree in FinanceCommunications Radio/Television from George Mason University and an M.B.A. from AmericanSouthern Illinois University. Mr. Matta's leadership positionLivek brings substantial industry experience and experience with our company coupled with his management abilities and his extensive knowledge of our industry qualify himaudience measurement expertise to serve as a member of our Board of Directors.and management team.Magid M. Abraham, Ph.D., one of our co-founders, has served as Executive Chairman of our Board of DirectorsChief Legal Officer since March 1, 2014. Dr. AbrahamDecember 2019 and as our Chief Compliance Officer since April 2017. She previously served as our General Counsel and Chief Privacy and People Officer from January 2017 to December 2019. Prior to joining the company, Ms. DiBattiste held positions at the U.S. Department of Veterans Affairs with the Board of Veterans’ Appeals as Executive in Charge and Vice Chairman from August 2016 to January 2017, and Senior Advisor for Appeals Modernization, Office of the Secretary, from May 2016 to August 2016. Prior to that, Ms. DiBattiste served as Executive Vice President and Chief Legal, Privacy, Security and Administrative Officer of Education Management Corporation, an operator offor-profit
post-secondary educational institutions, from March 2013 through March 2016. She also served as Executive Vice President, General Counsel and Chief Administrative Officer of Geeknet, Inc., as Executive Vice President, Privacy, Compliance and Security of Reed Elsevier/LexisNexis, and as General Counsel and Chief Privacy and Compliance Officer of ChoicePoint. Among other distinguished government positions, Ms. DiBattiste served as Deputy Administrator of the U.S. Transportation Security Administration, as Under Secretary of the U.S. Air Force, as Deputy U.S. Attorney (Southern District of Florida), as Director, Executive Office for U.S. Attorneys, and as Principal Deputy General Counsel, U.S. Department of the Navy. Ms. DiBattiste holds an L.L.M., Law from the Columbia University School of Law, a J.D. from Temple University School of Law, and a B.A., Sociology-Criminal Justice from LaSalle University.
has served as our Chief Financial Officer and Treasurer since October 2017 and previously served as our Executive Vice President, Finance since joining the company earlier in October 2017. Prior to joining the company, Mr. Fink was the Senior Vice President, Controller and Chief Accounting Officer at Fannie Mae, a government-sponsored enterprise in the mortgage industry, since 2011, where he led a team of 600 professionals and oversaw a multi-billion-dollar annual expense budget. He has more than 25 years of experience in accounting, financial reporting, business analytics, budgeting, internal controls and talent development. Mr. Fink holds a B.S. in Business Administration with an accounting emphasis from San Diego State University and is a Certified Public Accountant. has served as our Chief Commercial Officer since April 2019. He previously served as our Chief Revenue Officer from
1999June 2017 to
March 2014December 2018 and
has been a member ofas our
Board of Directors since 1999. In 1995, Dr. Abraham founded Paragren Technologies, Inc., which specialized in delivering large scale Customer Relationship Marketing systems for strategic and target marketing, andExecutive Vice President, Commercial from January 2016 to June 2017. Prior to joining the company, Mr. Wilson served as
its Chief Executive OfficerPresident, National Television at Rentrak Corporation from
1995 to 1999. Prior to founding Paragren, Dr. Abraham was employed by Information Resources, Inc. from 19852010 until
1995, whereour merger with Rentrak in January 2016. Before Rentrak, he was
Senior Vice President, Sales at Scarborough Research Company; President at Experian Research Services; President and
Chief Operating OfficerCOO of Simmons Market Research Bureau; and CEO and President of LogicLab, a division of Merkle LLC. Mr. Wilson holds a bachelor’s degree in Broadcast Communications from
1993 to 1994 and later ViceSouthern Illinois University, Carbondale. has served as Chairman of the Board
of Directors from 1994 until 1995. Dr. Abraham received a Ph.D. in Operations Researchsince April 2018 and
an M.B.A. from MIT. He also holds an Engineering degree from the École Polytechnique in France. Dr. Abraham’s strategic and product vision, long history as a
co-founderdirector since January 2016. Mr. Rosenthal is the Founder of Mountain Hawk Capital Partners, LLC., an investment fund focused on small and
member of our Board of Directors,microcap equities in the technology, media, telecom (TMT) and
extensive knowledge of our industry qualify him to serve as a member of our Board of Directors. Gian M. Fulgoni, one of our co-founders,food industries. Mr. Rosenthal has served as our Chairman Emeritus since March 2014. Mr. Fulgoni previously served as Executive Chairman of our Board of Directors from 1999 to March 2014 and has been theNon-Executive
a member of our Board of Directors since 1999. Prior to co-founding comScore, Mr. Fulgoni was employed by Information Resources, Inc., where he served as President from 1981 to 1989, Chief Executive Officer from 1986 to 1998 and Chairman of the board of directors
from 1991 until 1995. Mr. Fulgoniof RiceBran Technologies, a food company, since July 2016 and has served
onas an advisor to the board of directors
and executive management of
PetMed Express, Inc.FLYHT Aerospace since
2002 and previously served on its board from August 1999 through November 2000. Mr. Fulgoni also served on the board of directors of the Advertising Research Foundation, an industry research organization, from 2008 to 2014.December 2019. He also served on the board of directors of
Platinum Technology, Inc.SITO Mobile, Ltd., a mobile location-based media platform, from
1990August 2016 to
1999, U.S. Robotics, Inc.July 2018, and asNon-Executive
Chairman of its board of directors from
1991June 2017 to
1994,July 2018. Previously, Mr. Rosenthal was a Partner in affiliates of W.R. Huff Asset Management where he worked from 2002 to 2016. Mr. Rosenthal served as theNon-Executive
Chairman of Rentrak Corporation from 2011 to 2016. He was Special Advisor to the board of directors of Park City Group from November 2015 to February 2018. Mr. Rosenthal earned his B.S. from Lehigh University and
Yesmail.com, Inc.M.B.A. from
1999the S.C. Johnson Graduate School of Management at Cornell University. He is an inactive Certified Public Accountant. Mr. Rosenthal brings to
2000. Educatedour Board financial expertise and experience in the
United Kingdom, Mr. Fulgoni holds an M.A. in Marketing from the University of Lancastermedia and
a B.Sc. in Physics from the University of Manchester. Mr. Fulgoni's strategic vision, long history as a co-founder and member of our Board of Directors, extensive knowledge of our business and experience as a director at other technology companies qualify him to serve as a member of our Board of Directors.information industries.Melvin Wesley III has served as our Chief Financial Officer since August 2014. From January 2013 to December 2013, he served as Chief Financial Officer of Mandiant Corporation, a provider of advanced endpoint security products and security incident response management solutions. He stayed on as CFO, Global Services and Cloud Solutions at FireEye after the company acquired Mandiant in December 2013. From December 2004 to January 2013, Mr. Wesley was Senior Vice President and Chief Financial Officer of OPNET Technologies, a publicly traded company that provided application and network performance solutions. He served as Corporate Controller for OPNET from June 2004 to November 2004. Previously, Mr. Wesley served as Corporate Controller for SteelCloud, Inc. and as Assistant Controller for Learning Tree International, Inc., both publicly traded companies in the technology sector. He holds a B.S. in Accounting and an MBA from George Mason University and is licensed as a Certified Public Accountant in Virginia.Joanne Bradford
Cameron Meierhoefer has served as our Chief Operating Officer since March 2012. Previously, he held various senior positions at comScore. Most recently he served as Executive Vice President of Custom Analytics from January 2009 to March 2012 and as Senior Vice President of Custom Analytics from January 2006 to January 2009. Prior to joining comScore in 2001, he helped build PC Data Online, a division of the market research firm PC Data Inc. Mr. Meierhoefer holds a B.S. from Columbia University and a M.S. from the Georgia Institute of Technology.
Christiana L. Lin has served as our Executive Vice President, General Counsel and Chief Privacy Officer since August 2009. Previously, she served as our General Counsel and Chief Privacy Officer from January 2006 until August 2009, our Corporate Counsel and Chief Privacy Officer from March 2003 until January 2006, and our Deputy General Counsel from February 2001 until March 2003. Prior to comScore, Ms. Lin held positions in a boutique telecommunications law firm and within the government, including the Department of Defense as well as the White House. Ms. Lin holds a J.D. from the Georgetown University Law Center and a B.A. in Political Science from Yale University.
Michael A. Brown has served as our Chief Technology Officer since February 2011. Previously, Mr. Brown served as Chief Scientist from May 2010 until January 2011 and Executive Vice President within the technology team from November 2007 until May 2010. Prior to joining comScore in 1999, Mr. Brown worked as a consultant for several software engineering and development consulting companies. In 1993, he cofounded Pragmatic Image Technologies, a software consulting group. Mr. Brown holds an M.S. in Computer and Information Science from Hood College, and a B.S. in Computer Science from the University of Maryland University College.
Non-Executive Directors
Russell Fradinhas served as a director since April 2019. She has been President of Honey Science Corp., ane-commerce
technology platform, since August 2019. Honey was acquired by PayPal in January 2020. Prior to joining Honey, Ms. Bradford was Chief Marketing Officer of SoFi, an online personal finance company, from June 2017 to May 2019. She previously served as Chief Operating Officer of SoFi from July 2014. Since2015 to June 2017. Ms. Bradford served as Head of Partnerships at Pinterest, a social media web and mobile application company, from November 2010 2013 to December 2015. She previously held executive-level roles at the Hearst Corporation and San Francisco Chronicle, Demand Media, Yahoo!, Mr. Fradinand Microsoft Corporation. Ms. Bradford has served as a director of Wave App, a small business software company, since October 2018 and OneLogin, a unified access management company, since July 2019. Ms. Bradford holds a B.A. in Journalism from San Diego State University. Ms. Bradford brings to our Board over 20 years of experience leading product marketing, business development and programming, as well as building global sales and marketing teams.has served as a director since April 2019. Mr. Gotlieb has been a senior advisor to WPP plc, a multinational advertising and public relations company, since April 2018. He was formerly the global Chief Executive Officer and Chairman of
GroupM, a global media investment group, from its formation in early 2003 to 2012 and Chairman of GroupM until April 2018. Mr. Gotlieb has served on the board of directors
of Invidi, a media solutions company, since October 2007, and on the advisory board of Harland Clarke, a payment solutions company, from January 2014 to December 2018. Mr. Gotlieb brings over 40 years of industry experience to the Board and is the first media agency executive inducted into both the American Advertising Federation Hall of Fame and the Broadcasting & Cable Hall of Fame. has served as a director since June 2017. Mr. Kerrest served as Executive Vice President and CFO of Intelsat S.A., a communications satellite services provider, from February 2016 to June 2019. Prior to his appointment at Intelsat, he held
executive-level roles at numerous leading technology and communications companies, including ActivIdentity Corporation, Virgin Media Inc., Harte-Hanks Corporation and Chancellor Broadcasting Company. Previously, Mr. Kerrest served on the boards of directors of several public companies. Mr. Kerrest received his Master of Science Degree from Faculté des Sciences Économiques in Paris, France, and an M.B.A. from Institut D’Etudes Politiques De Paris in Paris, France as well as the Thunderbird School of Global Management in Glendale, Arizona. Mr. Kerrest’s deep financial expertise and background enable him to bring valuable perspective to our Board.
has served as a director since April 2019. Ms. Love is currently the Chief Executive Officer of Motherwell Resources LLC, a company devoted to management consulting and executive coaching, which she founded in 2013. Prior to founding Motherwell, Ms. Love served as the President and Chief Executive Officer of
Dynamic Signal,GFK MRI (formerly Mediamark Research), a
social media
research company, from 2000 to 2013. Prior to joining MRI, Ms. Love held executive positions at The New York Times, EMAP Publishing and The Magazine Publishers of America. She has been an adjunct or guest instructor at Rutgers University, Brooklyn College and Queens College. Ms. Love holds a B.A. degree from Douglass College, Rutgers – The State University, an M.A. from Michigan State University and an M.Phil. from The Graduate Center, C.U.N.Y. She has advanced to candidacy for a Ph.D. in psychology. Ms. Love brings over 30 years of industry experience in media and marketing
technology company that he co-founded. From November, 2005research, strategic planning and business development to
October, 2010, heour Board. has served as
a director since May 2019. Mr. Martin was the Chairman and CEO of Turner Broadcasting System, Inc., a media and entertainment company, from January 2014 through June 2018. At Turner Broadcasting, Mr. Martin oversaw a portfolio of networks including CNN, TBS, TNT, Cartoon Network, Adult Swim and Turner Sports. Prior to Turner Broadcasting, Mr. Martin was the Chief
ExecutiveFinancial and Administrative Officer of
Adify,Time Warner, Inc. for six years. Mr. Martin holds an
advertising company that he also co-founded, which was sold to Cox Enterprises in 2008. From June 2000 to June 2004, Mr. Fradin was comScore’s Executive Vice President, Corporate Development. Mr. Fradin currently serves on the Board of Directors of TubeMogul, Inc., a public company. He holdsM.B.A. from Columbia University and a B.S. from the Wharton School of
Business atBusiness. Mr. Martin brings substantial industry experience and financial expertise to our Board. Board Structure and Leadership
Our Board is currently composed of seven directors and is divided into three classes (Class I, Class II and Class III) with staggered three-year terms.
Our governance framework provides the UniversityBoard with flexibility to select the appropriate Board leadership structure for the company. In making leadership structure determinations, our Board considers many factors, including the specific needs of Pennsylvania. Having served as founderthe company and what is in the best interests of our stockholders. While the Board does not currently have a formal policy on whether the role of the Chief Executive Officer and Chairman of several digital advertising, marketingthe Board should be separate, since 2016 the Board has elected its Chairman from among the independent directors. Moreover, our Corporate Governance Guidelines provide that if the positions of Chief Executive Officer and technology companies, Chairman are ever combined, or if the Chairman is not an independent director, the independent members of the Board will select an independent director to serve as Lead Independent Director.
Mr. Fradin bringsRosenthal, an independent director, currently serves as Chairman of the Board. We believe this structure is appropriate for the company at this time, based on the current composition of our Board and management team and recent changes in the business.
Standing Committees of the Board of Directors
Our Board has a standing Audit Committee, Compensation Committee and Nominating and Governance Committee. The Board and its committees meet regularly throughout the year and also hold special meetings and act by written consent from time to time as appropriate. The Board has determined that all standing committee members are independent within the meaning of the requirements of the Sarbanes-Oxley Act of 2002, The Nasdaq Stock Market (“Nasdaq”), and the rules and regulations of the SEC, as applicable. Each standing committee operates under a written charter approved by the Board, each of which is available under “Corporate Governance” on the Investor Relations section of our website at. Our Board has delegated various responsibilities and authority to its committees as generally described below. . We have a separately-designated standing Audit Committee established in accordance with Section 3(a)(58)(A) of the Exchange Act. The Audit Committee’s responsibilities include appointing and overseeing the work of our independent auditors, reviewing the adequacy and effectiveness of our system of internal controls, reviewing and discussing with management and the independent auditors the company’s annual audited financial statements and quarterly unaudited financial statements, and overseeing the company’s legal and regulatory compliance programs. Among other things, the Audit Committee is charged with setting the overall corporate tone for quality financial reporting, sound business risk practices and ethical behavior.
The Board has determined that Joanne Bradford, Jacques Kerrest and Brent Rosenthal are “audit committee financial experts” as defined under SEC rules. Ms. Bradford qualifies as an audit committee financial expert by means of having served in various executive roles (including as president and chief operating officer) as described under “Directors and Executive Officers –Non-Executive
Directors.” Designation or identification of a person as an audit committee financial expert does not impose any duties, obligations or liability that are greater than the duties, obligations or liability imposed on such person as a member of the Audit Committee and the Board in the absence of such designation or identification. We believe that the composition and functioning of our Audit Committee complies with all applicable requirements of the Sarbanes-Oxley Act of 2002 and Nasdaq and SEC rules and regulations. Our Audit Committee met 12 times (including telephonic meetings, but not including actions by written consent) during 2019. The Audit Committee is currently composed of Jacques Kerrest (Chair), Joanne Bradford and Brent Rosenthal. . The Compensation Committee’s responsibilities include reviewing and approving or recommending to our Board
the compensation of
our executive officers andnon-employee
Directors a familiaritydirectors, administering our incentive compensation and equity compensation plans, and reviewing and making recommendations to the Board regarding compensation-related policies and procedures. The Compensation Committee may form and delegate authority to subcommittees when appropriate, including in connection with the digital marketingallocation of equity awards (subject to conditions and advertising industry,limitations established by the Compensation Committee). We believe that the composition and functioning of our Compensation Committee complies with all applicable requirements of the Sarbanes-Oxley Act of 2002 and Nasdaq and SEC rules and regulations. Our Compensation Committee met 19 times (including telephonic meetings, but not including actions by written consent) during 2019. The Compensation Committee is currently composed of Kathleen Love (Chair), Joanne Bradford and John Martin.
Nominating and Governance Committee
Our Board has an active role, as a whole and also at the committee level, in overseeing management of our company’s risks. The Board regularly reviews information regarding our liquidity and operations, as well as an understandingthe risks associated with each. Our Audit Committee oversees management of financial, regulatory, security and compliance risks, including quarterly reports from our Chief Compliance Officer. Our Compensation Committee is responsible for overseeing management of risks relating to our executive compensation plans and arrangements. Our Nominating and Governance Committee evaluates risks associated with the independence and composition of our Board, our governance practices and management succession. While each committee is responsible for evaluating certain risks and overseeing the management of such risks, our entire Board is regularly informed about such risks through committee reports, attendance at committee meetings and otherwise.
Board of Directors and Committee Meeting Attendance
Our Board met 29 times (including telephonic meetings, but not including actions by written consent) during 2019. Each of our current directors attended at least 75% of the strategicaggregate of (i) the total number of meetings held by the Board during the period in 2019 for which he or she was a director and operational challenges(ii) the total number of meetings held by all committees of the Board on which such individual served during the period in leading and operating companies in this industry.
William J. Henderson has2019 for which he or she served as a director since August 2001,committee member.
The independent and
asnon-management
members of our
leadBoard regularly meet in executive session without management present. Director and Director Nominee Independence
The Board has determined that each of Joanne Bradford, Jacques Kerrest, Kathleen Love, John Martin and Brent Rosenthal is independent director since October 2014. Mr. Henderson wasunder the 71st Postmaster Generalrules of the United States. He servedSEC and Nasdaq listing standards. The Board previously determined that each of Michelle
McKenna, Robert Norman and Paul Reilly was independent under the rules of the SEC and Nasdaq listing standards during his or her service as a director in 2019, and Dale Fuller was independent under the rules of the SEC and Nasdaq listing standards during his service as a director in 2019 prior to his appointment as Interim Chief Executive Officer. Therefore, each member of the Audit Committee, Compensation Committee and Nominating and Governance Committee during 2019 was, and each current member is, independent in accordance with those rules and standards during the time that position from May 1998 until his retirementhe or she served. In addition, our Board was composed of a majority of independent directors at all times during 2019 and continues to be so composed. In determining the independence of our directors, our Board considered all transactions in May 2001. Mr. Henderson also served aswhich we and any director had any interest, including those involving payments made by us to companies in the Chief Operations Officerordinary course of Netflix, Inc. from January 2006 until February 2007. Mr. Henderson currently servesbusiness where any of our directors or their immediate family members serve on the board of directors or in management or advisory roles (Fuller, Kerrest, McKenna and Norman), current and prior employment relationships of Acxiom Corporation, a public company, where he has been a director since June 2001. Mr. Henderson holds a B.S. from the University of North Carolina at Chapel Hilldirectors or their immediate family members (Fuller and servedLove), and compensation for service in the U.S. Army. Mr. Henderson brings to our Board of Directors his management experience as Postmaster Generalleadership roles (Rosenthal).
Compensation Committee Interlocks and his service as a director of our company since 2001, which affords him unique perspectives on our growthInsider Participation
Independent directors Joanne Bradford, Jacques Kerrest, Kathleen Love, John Martin, Michelle McKenna, Robert Norman and evolution.
William Katz hasPaul Reilly served as a director since June 2008. Since June 2004, Mr. Katz has also served as the chairmanmembers of the board of directors of Visible World Inc., a privately-held multimedia marketing services provider. From 1996 to 2004, Mr. KatzCompensation Committee at various times during 2019. No person who served as President and Chief Executive Officer of BBDO New York, the flagship office of BBDO Worldwide, the world’s third largest global agency network. Mr. Katz holds a B.A. in Business and Psychology from American University. Mr. Katz brings to our Board of Directors his management experience in the advertising and marketing industry.
Ronald J. Korn has served as a director since November 2005. Since 1991, he has served as the President of Ronald Korn Consulting, which provides business and marketing services. Mr. Korn served as a director, chairman of the audit committee, and member of the loan committee of Equinox Financial Corporation from 1999 until its acquisition in October 2005. Since 2002, he has served as a director, chairman of the audit committee and a member of the compensation, investment and nominating and governance committees of PetMed Express, Inc., a public company. Since July 2003, he has served as a director, chairman of the audit committee and a member of our compensation committee of Ocwen Financial Corporation, a public company. Mr. Korn was a partner and employee of KPMG, LLP, from 1961 to 1991, where he was the managing partner of KPMG’s Miami office from 1985 until 1991. Mr. Korn holds a B.S. from the Wharton School of Business at the University of Pennsylvania and a J.D. from New York University Law School. Mr. Korn’s experience in financial matters and as a member of the audit committee of other public companies provides our Board of Directors with financial management and accounting experience.
Joan M. Lewis has served as a director since January 2015. Ms. LewisCompensation Committee during 2019 was Senior Vice President, Consumer and Market Knowledge of The Procter & Gamble Company, a consumer packaged goods company, from 2008 through December 2014. Previously, she held a number of other leadership positions with Procter & Gamble, including Vice President, Global Operations and Director, North America. Ms. Lewis has also previously served on the Singapore Industry Advisory Board for Consumer Insights, the Advertising Research Foundation Board of Directors, and the Business Advisory Council for the Farmer School of Business at Miami University. She holds a B.S. from Miami University. Ms. Lewis' extensive experience as a customer of a wide variety of market research products gives her a deep understanding of the competitive landscape for digital market research companies, which qualifies her to serve as a memberan officer or employee of our Board of Directors.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended,company during such year or the Exchange Act, requires that certaina prior year. Moreover, none of our executive officers andserved on the board of directors and persons who ownor compensation committee of any entity that had one or more than 10% of a registered class of our equity securities, file reports of ownership and changes in ownership (Forms 3, 4 and 5) with the SEC. Suchits executive officers directors and greater than 10% holders are required to furnish us with copies of all of these forms that they file. Certain employees of our company hold a power of attorney to enable such individuals to file ownership and change in ownership forms on behalf of certain of our executive officers and directors.
Based solelyserving on our review of these reportsBoard or written representations from certain reporting persons, we believe thatCompensation Committee during 2014, all filing requirements applicable to our officers, directors, greater-than-10% beneficial owners and other persons subject to Section 16(a) of the Securities Exchange Act of 1934, as amended, were met, except for the following reports:2019.
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Date Filed | Form | Name(s) of Filer(s) | Description |
February 21, 2014 | 4 | Magid Abraham | Filing related to transaction originally occurring on February 14, 2014.
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March 5, 2014 | 4 | Magid Abraham
| Filing related to transaction originally occurring on February 28, 2014.
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March 19, 2014 and April 1, 2014
| 4 | Magid Abraham
Serge Matta
Gian Fulgoni
Christiana Lin
Kenneth Tarpey
Cameron Meierhoefer
| Filing related to transaction originally occurring on March 14, 2014. |
April 14, 2014 | 4 | Magid Abraham
Cameron Meierhoefer
| Filing related to transaction originally occurring on April 9, 2014. |
April 30, 2014 | 4 | Christiana Lin
Cameron Meierhoefer
| Filing related to transaction originally occurring on April 27, 2014. |
August 5, 2014 | 4 | Cameron Meierhoefer | Filing related to transaction originally occurring on July 30, 2014.
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August 22, 2014 | 4/A | Kenneth Tarpey | Amended Form 4 related to transaction originally occurring on August 15, 2014. |
CORPORATE GOVERNANCE
Code of Business Conduct and Ethics
We haveOur Board has adopted a Code of Business Conduct and Ethics that applies to all directors,
officers and employees of the company, including our principal executive officer, principal financial officer and principal accounting officer or
controller.controller, and persons performing similar functions. The full text of our Code of Business Conduct and Ethics is posted under
“Corporate Governance” on the
“Investor Relations”Investor Relations section
onof our website at
http://www.comscore.com.. To the extent permissible under Nasdaq rules, we intend to disclose any amendments to our Code of Business Conduct and Ethics or waivers thereto that apply to our principal executive officer, principal financial officer or principal accounting officer or controller by posting such information on the same website.Reporting andNon-Retaliation
Policy Our Board has adopted a reporting andnon-retaliation
policy to encourage employees and others to disclose wrongdoing or suspected wrongdoing that could adversely impact the company, our reputation, or our stockholders, customers, employees or other stakeholders, and to set forth the procedures by which reports should be made, investigated and addressed. Corporate Governance Guidelines
TheOur Board has adopted written Corporate Governance Guidelinescorporate governance guidelines that set forth key principles thatto guide its actions, including:
the Board’s commitment to appropriate diversity among the candidates nominated for election to the Board;
limits on outside boards, including
that directors who are executive officers of the
rolecompany may serve on the board of directors of no more than two public companies, including our Board, andnon-management
directors should not serve on more than four public company boards, including our Board; a requirement that a substantial majority of the members of our Board must be independent;
a commitment to appointing a Lead Independent Director. Additionally,Director should the Corporate Governance Guidelines requireroles of Chairman and Chief Executive Officer ever be combined; and
a commitment to an annual assessmentreview of the Board's performance including performance of the Board and its individual directors.committees.
Director Resignation Policy
Our Board has adopted a director resignation policy, which provides that any nominee for director who receives a majority of “withhold” votes in an uncontested election of directors is expected to tender his or her resignation promptly following the certification of the election results. In such event, the Nominating and Governance Committee will promptly consider the tendered
resignation and will recommend to the Board whether to accept or reject the resignation. The Board will act on the Nominating and Governance Committee’s recommendation no later than 90 days following the certification of the stockholder vote. The company will promptly disclose the Board’s decision (and, if the Board rejects the resignation, the Board’s reasons for doing so).
Stock Ownership Guidelines for Non-Employee Directors
TheOur Board has also adopted written Stock Ownership Guidelines for Non-Employee Directorsstock ownership guidelines to further align the interests of our directors and executive officers with those of our stockholders. These guidelines are described under “Compensation Discussion and Analysis – Other Compensation Policies” below.
Our Board has adopted a clawback policy that provides for recovery of executive compensation in the Company's non-employeeevent of an accounting restatement, fraud or error. This policy is described under “Compensation Discussion and Analysis – Other Compensation Policies” below.
Anti-Hedging and Pledging Policy
Our Board has adopted an anti-hedging and pledging policy, which prohibits directors, withexecutive officers, their family members and entities that they control from hedging and pledging Comscore securities. This policy is described under “Compensation Discussion and Analysis – Other Compensation Policies” below.
Political Activity Policy
Our Board has adopted a political activity policy that gives the Nominating and Governance Committee oversight over any lobbying and political activities conducted by our company. The policy states that such activities will be conducted for the purpose of promoting the commercial interests of the company as a whole, be in furtherance of the interests of the Company's stockholders. Each non-employee director who joins the Board is expectedour stockholders, and be in compliance with applicable laws, rules and regulations. The policy further provides that employees may not make or commit to hold a number of sharesmake political contributions on behalf of the Company's common stock with a value equal tocompany, and we will not reimburse or at least two timesotherwise compensate an employee for his or her annual stock retainer for servicepersonal political contributions.
Delinquent Section 16(a) Reports
Section 16(a) of the Exchange Act requires that certain of our directors, executive officers, and persons who beneficially own more than 10% of a registered class of our equity securities file reports of ownership and changes in ownership (Forms 3, 4 and 5) with the SEC. Such directors, executive officers and greater than 10% beneficial owners are required to furnish us with copies of all of these forms that they file. Certain Comscore employees hold a power of attorney to enable such individuals to file ownership and change in ownership forms on the Board, exclusivebehalf of retainers for serving as a memberour directors and executive officers.
Based solely on our review of these reports or chair of any Board committee, within 5 years of adoption of this policy.
DIRECTOR NOMINATIONS
There have been no material changes to the procedures by which security holders may recommend nomineeswritten representations from certain reporting persons, we believe that during 2019, all filing requirements applicable to our Board of Directors since those procedures were described in our proxy statement for our 2014 annual meeting of stockholders.
AUDIT COMMITTEE
We have a separately-designated audit committee of our Board of Directors established in accordance withdirectors, executive officers, greater than 10% beneficial owners and other persons subject to Section 3(a)(58)(A)16(a) of the Securities Exchange Act of 1934 as amended.were timely met, except for two Form 4s for Christopher Wilson (relating to a single vesting event and related tax withholding obligation) that were late due to an administrative issue.
Compensation Discussion and Analysis
The audit committee is currently comprised of Ronald J. Korn (chair), William J. Hendersonfollowing Compensation Discussion and Joan M. Lewis, each of whom is independent withinAnalysis (“CD&A”) provides information regarding our executive compensation philosophy, the meaning of the requirements of the Sarbanes-Oxley Act of 2002 and applicable SEC and NASDAQ rules. Ronald J. Korn is chairmanelements of our audit committee as well as our audit committee financial expert, as currently defined underexecutive compensation program, and the SEC rules implementingfactors that were considered in the Sarbanes-Oxley Act of 2002. We believe that the compositioncompensation actions and functioning of our audit committee complies with all applicable requirements of the Sarbanes-Oxley Act of 2002, The NASDAQ Global Market, and SEC rules and regulations.
The audit committee operates under a written charter adopted by our Board of Directors, a copy of which is available under the “Investor Relations” section of our website, http://www.comscore.com.
ITEM 11. EXECUTIVE COMPENSATION
COMPENSATION DISCUSSION AND ANALYSIS
The following discussion and analysis of our compensation arrangements withdecisions for our named executive officers during 2019. Although this CD&A focuses on our executive compensation program during the last fiscal year, it also describes compensation actions taken before or after 2019 to the extent such discussion enhances an understanding of our executive compensation disclosure. This CD&A should be read together with the compensation tables and related disclosures set forth elsewhere in this Amendment No. 1 to Annual Report on Form 10-K/A. filing.
Our named executive officers for the year ended December 31, 20142019 were:
Serge Matta, President and
William Livek, our Chief Executive Officer (our “Chiefand Executive Officer”)Vice Chairman (effective November 4, 2019);
Magid Abraham,
Dale Fuller, our former Interim Chief Executive Officer (effective March 31, 2019 until November 4, 2019);
Bryan Wiener, our former Chief Executive Officer (until March 31, 2019);
Gregory Fink, our Chief Financial Officer;
Carol DiBattiste, our Chief Legal and Compliance Officer;
Christopher Wilson, our Chief Commercial Officer (effective April 17, 2019);
Sarah Hofstetter, our former President (until March 31, 2019); and
Kathryn Bachmann, our former Chief Operating Officer (effective April 17, 2019 until May 29, 2019).
In 2019, our Compensation Committee was guided by certain core compensation principles, including aligning executive officers’ interests with those of our stockholders, promoting achievement of strategic objectives, and maintaining a strong corporate culture. At the same time, our 2019 compensation decisions were significantly impacted by changes in our executive team and operations, as described below. Our decisions were also impacted by declines in our stock price, which diminished the effectiveness of our equity awards as a means to recruit and retain key personnel. These factors led to a more individualized, situational approach to executive compensation in 2019, with decisions driven more by specific hiring and retention needs than by a programmatic review of compensation for the year. Since the appointment of our new Chief Executive Officer in late 2019, our Compensation Committee has taken steps to return to a more normalized compensation cadence for the company.
Senior Executive Changes in 2019
On March 31, 2019, Bryan Wiener resigned as our Chief Executive Officer and Sarah Hofstetter resigned as our President, effective immediately. On the same date, Dale Fuller (then a member of our Board of Directors) was appointed as our Interim Chief Executive Officer.
On April 12, 2019, Christopher Wilson (formerly our Chief Revenue Officer and a consultant to the company) was appointed as our Chief Commercial Officer and Kathryn Bachmann was appointed as our Chief Operating Officer, effective April 17, 2019. Ms. Bachmann resigned as our Chief Operating Officer on May 29, 2019.
On November 4, 2019, William Livek (then a special advisor and Vice Chairman of our Board of Directors (our “Executive Chairman") and formerDirectors) was appointed as our Chief Executive Officer;
Gian M. Fulgoni, Chairman EmeritusOfficer and Director;
Melvin Wesley III, Chief Financial Officer (our "CFO");
Cameron Meierhoefer, Chief Operating Officer;
Christiana Lin, Executive Vice
President, General Counsel and Chief Privacy Officer;Chairman, effective immediately. Upon Mr. Livek’s appointment, Mr. Fuller resumed his role as anon-employee
director.Compensation Committee Composition
During 2019, the following members of our Board of Directors served on the Compensation Committee:
Michelle McKenna (until March 7, 2019);
Robert Norman (until May 22, 2019);
Paul Reilly (until August 12, 2019);
Jacques Kerrest (from March 9, 2019 to March 31, 2019);
Joanne Bradford (from April 1, 2019 to present);
Kathleen Love (from April 1, 2019 to present); and
Kenneth J. Tarpey, former Chief Financial Officer (retired August 28, 2014)
John Martin (from September 6, 2019 to present).
As of the date of this filing, the Compensation Committee is composed of Kathleen Love (Chair), Joanne Bradford and John Martin.
Our Executive Compensation Philosophy
The objective ofHistorically, our compensation programs for our employees, including our executive officers, is to attract and retain top talent. Our compensation plans are designed to motivate and reward employees for achievement of positive business results and also to promote and enforce accountability.
In determining the compensation arrangements of our named executive officers, we areCompensation Committee has been guided by the following key principles:goals and principles in establishing compensation arrangements for our executive officers:
Align Stockholder Interests and Promote Achievement of Strategic Objectives. Not only should our compensation arrangements be tied to our financial performance, strong performance-based equity awards for high growth in the value of our common stock serve toInterests.
align our executive officers’ interests with those of our
stockholders, the Compensation Committee believes that compensation arrangements should be tied to long-term value creation for our stockholders.
Promote Achievement of Financial Goals. Company Objectives.
Compensation
Committee believes that executive compensation should
be dependent onpromote the achievement of our financial,
goalsstrategic and
increasing the value of our common stock. We seek to establish financial targets that are aligned with the financial targets that we provide to our investors and stockholders in the beginning of the year.Reward Superior Performance. We believe
that
while total compensation for
an executive
officers should be both competitive and tied to
achievement of financial goals and strategic objectives, performance that exceeds targetspre-established
objectives. Performance exceeding target levels should be appropriately
awarded.Attract and Retain Top Talent. Our
compensation arrangements should be sufficient to allow us to attract, retain and motivate executive officers with the
necessary skills and talent
needed to
successfully
manage our business taking into consideration a number of factors such as market analyses, experience, alternative market opportunities, and consistency withsuccessfully.
Prioritize Tone at the compensation paid to other professionals within our organization.Top.
Application of our Philosophy
We believeEnsuring that our executive officers prioritize and maintain a strong, ethical corporate culture and appropriate tone at the top is an additional principle that guides our Compensation Committee’s actions and decisions.
Finally, our compensation program appropriately balances short-termprograms are intended to be consistent with corporate governance best practices. This is demonstrated by our:
stock ownership guidelines for directors and long-term elements, cashexecutive officers;
compensation recovery (clawback) policy and equity elements,provisions;
anti-hedging and fixedpledging policy;
insider trading policy and contingent payments. We applypreclearance requirements;
consideration of market data, input from stockholders and critiques from stockholder advisory firms;
independent Compensation Committee oversight;
engagement of an outside compensation consultant;
no automatic increases in executive salaries or lock-step changes in compensation based on peer group levels or metrics;
limited perquisites; and
no repricing or buyout of underwater stock options without stockholder approval.
Compensation-Setting Process
Guided by our compensation philosophy, using both quantitativeour Compensation Committee generally seeks to provide total compensation packages that are fair, reasonable and qualitative performance measures to motivate our named executive officers and reward them for achieving the following goals:
develop a culture that embodies a passion for our business and a drive to achieve and exceed established goals and objectives;
provide leadership to the organization in such a way as to maximize the results of our business operations;
lead us by demonstrating forward thinking in the operation, development and expansion of our business; and
effectively manage organizational resources to derive the greatest value possible from each dollar invested.
Our executive compensation program aims not only to compensate top talent at levels thatconsistent with competitive practice. Overall, we believe are generally at or near the median of the competitive market (as reflected by our compensation peer group), but also to be proportionate relative to compensation paid to other professionals within our organization, and to be appropriately linked to our short-term and long-term performance results and to the value we deliver to our stockholders. In some instances, we may adjust our compensation levels in the event that the compensation committee of our Board of Directors (our "Compensation Committee") believes such compensation would be in our best interest to attract or retain a specific executive officer. We seek to maintain a performance-oriented culture with a compensation approachopportunities that rewardsreward our named executive officers when we achieve andor exceed our goals, and objectives, while putting at risk a significant portion of their target compensation againstat risk in the possibilityevent of underperformance.
In 2019, our compensation-setting process was also influenced by the extraordinary circumstances we faced. In addition to the leadership transitions described above, we implemented significant operational changes during 2019, including multiple workforce reductions, lease and contract terminations, and other cost-reduction initiatives. Due to these changes, we did notpre-establish
targets for the financial measures historically used in our incentive compensation programs. We also experienced declines in our stock price, which reduced the value of outstanding equity awards held by our executive officers, increased the number of shares required to deliver the same compensation value, and thus limited our ability to grant new awards that
would serve as meaningful incentives. These challenges led our
goals and objectives may not be achieved. Our Compensation Committee
considers bothto suspend our long-term incentive compensation program in 2019, with no new equity awards granted to our continuing executive officers during the year. The Compensation Committee also awarded annual bonuses based on a qualitative
assessment of strategic accomplishments, including the initiatives described above, rather than financial targets. At the same time, the Compensation Committee sought to maintain alignment between the interests of our executive officers and
quantitative factors as measuresour stockholders, including by linking a substantial portion of
individualtarget compensation for our new executive officers (including our new Chief Executive Officer) to performance,
and weights these factorsincluding sustained improvement in
assessing a particular individual’s performance.our stock price. Role of Our Compensation Committee
OurThe members of our Compensation Committee
isare appointed by our Board of Directors
and consiststo oversee our executive compensation program. At all times during 2019, the Compensation Committee was composed entirely of directors who
are “outside were“non-employee
directors” for purposes of
Section 162(m) of the Internal Revenue Code, “non-employee directors” for purposes ofSecurities Exchange Act Rule
16b-3
and “independent directors” under
theNasdaq listing
standards ofstandards.Pursuant to its charter, the NASDAQ Stock Market. Our Compensation Committee is comprised of Messrs. Henderson, Katz and Fradin, and is chaired by Mr. Henderson.
Our Compensation Committee approves, oversees and interprets our executive compensation program and related policies and practices, including our 1999 Stock Plan, our 2007 Equity Incentive Planequity incentive program and other compensation incentives and benefits programs. OurThe Compensation Committee is also responsible for establishing the compensation packages of our executive officers and ensuring that our executive compensation program is consistent with our compensation philosophy and corporate governance guidelines.policies.
OurGenerally, the Compensation Committee takes the following steps to ensure that our executive compensation program is consistent with both our compensation philosophyactions in the discharge of its responsibilities:
reviews the corporate goals and our corporate governance guidelines:
regularly reviews theobjectives of, and performance of and the total compensation earned by or awarded to, our Chief Executive Officer, and Executive Chairman independent of input from them;our Chief Executive Officer;
examines on an annual basis the performance of our other named executive officers with assistance from our Chief Executive Officer and Executive Chairman and approves total compensation packages for them that it believes to be appropriate and consistent with those generally found in the marketplace for executives in comparable positions;
regularly holds executive sessions without management present; and
engages a compensation consultant to review our executive compensation policies and practices, and provide analysis of the competitive market, for our executive officers in connection with each componentand make recommendations regarding the elements of our executive officer compensation packages.
As part of its decision-making process, ourthe Compensation Committee periodically evaluates comparative compensation data which includes base salary, short-term cash incentives, long-term incentive compensation (including equity awards) and other compensation components from similarly situated companies. OurHistorically, the Compensation Committee determineshas determined the target total direct compensation opportunities for each namedexecutive officers after considering the following factors, among others:
the scope and nature of the executive officer’s responsibilities;
how much the executive officer based onmight otherwise command in the following key factors:employment marketplace;
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(i) | how much we would be willing to pay to retain that named executive officer; |
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(ii) | how much we would expect to pay in the marketplace to replace that named executive officer; |
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(iii) | how much that named executive officer could otherwise command in the employment marketplace; |
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(iv) | past performance as well as the strategic value of the executive officer's future contributions; and |
Further, our
how much we would be willing to pay to retain the executive officer;
how much we would expect to pay in the marketplace to replace the executive officer;
past performance, as well as the strategic value of the executive officer’s future contributions; and
internal parity within the executive team.
The Compensation Committee also considers the recommendations of our Chief Executive Officer, who annuallyperiodically reviews competitive market data, individualthe performance, and changes in roles orand responsibilities of our other executive officers and proposes adjustments to the executive officer'stheir compensation based on this review. The Chief Executive Officer does not participate in Compensation Committee discussions or make recommendations with respect to his own compensation. By evaluating the comparative compensation data in light of the foregoing factors, we believe ourthe Compensation Committee is better ableseeks to tailor its compensation determinations withdecisions to the specific needs and responsibilities of the particular position, and the unique qualifications of the individual named executive officer.
Role of Compensation Consultant
OurThe Compensation Committee is authorized to retain the services of one or more executive compensation advisors from time to time, as it determines in its discretion, in connection with the discharge of its responsibilities. During 2014, ourThe Compensation Committee retained the services of Compensia, Inc.Meridian Capital Partners, LLC (“Meridian”), a national compensation consulting firm, as its compensation consultant. Compensiafor this purpose during 2019. Meridian serves at the discretion of our Compensation Committee. Compensia was engaged to provide advice and information relating to executive officer and director compensation. In 2014, Compensia assisted our Compensation Committee in (i) reviewing our compensation peer group, (ii) analyzing the compensation of our executive officers, (iii) reviewing and analyzing market data related to our executive officers’ base salaries, short-term cash incentives, and long-term incentive compensation levels, and (iv) evaluating equity plan design and structures.
Compensia reports directly to ourthe Compensation Committee andCommittee. Meridian did not provide any services to us or our management in 20142019 other than those provided to ourthe Compensation Committee as described above. Ourbelow.
In 2019, Meridian assisted the Compensation Committee hasby providing the following services:
reviewing our compensation peer group;
evaluating equity plan modeling, value delivery and share usage;
analyzing compensation arrangements for new executive officers and departing executive officers;
assisting with the valuation of market-based equity awards;
reviewing our change in control and severance agreements with executive officers; and
analyzing market data and other considerations related to compensation of our independent chairman.
The Compensation Committee considered all relevant factors relating to the independence of Compensia in light of the NASDAQ Marketplace RulesMeridian, including but not limited to applicable SEC rules and Nasdaq listing standards on Compensation Committee advisorcompensation consultant independence, and the rules of the Securities and Exchange Commission and has concluded that the work performed by CompensiaMeridian did not raise any conflict of interest.interest in 2019.
In order to attract and retain strong management talent, we believe we must provide a total compensation package that is competitive relative to our peers. For this purpose, we consider the practices of specific companies that we have identified as our peers. These companies are selected periodically by our Compensation Committee on the basis of industry, similar business models and comparable financials (including revenue and market capitalization). The peer companies used in 2019 were as follows, reflecting a shift from software companies to advertising and media companies. At the time the Compensation Committee selected this peer group in July 2019, our revenue approximated the median and our market capitalization approximated the 20th percentile of the peer group.
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Information Services Group | | |
Using data collected from these companies, Meridian provided analyses of our severance andchange-in-control
arrangements for executive officers against the competitive market. Our Compensation Committee also used data from these companies in its evaluation of our director compensation program. For additional context in its review of our severance andchange-in-control
arrangements, Meridian also considered survey data from the broader market. Stockholder Advisory Vote
7 on Executive Compensation
We conducted a
non-binding
stockholder advisory
(non-binding) vote on the compensation of our named executive officers
(a so-called “say-on-pay” (known as asay-on-pay
vote) for the year ended December 31,
20132018 at
our 2014 Annual Meetingthe last annual meeting of
Stockholders pursuant to rules promulgated under Section 14A of the Securities Exchange Act of 1934.stockholders that we held, which was in June 2019. Our stockholders expressed
strong support for the
2018 compensation of our named executive officers,
for the year ended December 31, 2013, with more than
85%
99% of the votes cast for approval of
their compensation.the proposal. Our Compensation Committee
carefully evaluatedconsidered the results of
this advisory thesay-on-pay
vote and
theother feedback
we received from
several of our
major stockholders,
as well as critiques from stockholder advisory firms, in
connection with its general evaluation ofdesigning our
compensation programs for 2019, particularly for new executive
compensation programs. Taking into accountofficers. Based on this input, the
results of the say-on-pay vote, along with other factors such as our corporate business objectives and our Compensation Committee’s review of competitive market data (as discussed in more detail below), our Compensation Committee did not
makeimplement significant changes to our executive compensation program
and policies as a result ofdesign for 2019, other than the
2014 “say-on-pay” vote. Review of Compensation Policies for 2014
In the fourth quarter of 2013, as part of our ongoing commitment to link current compensation levels to our compensation philosophy and business strategy, our Compensation Committee requested that Compensia review our direct compensation levels, including base salary, total cash compensation and total direct compensation. Alsosituational decisions described elsewhere in 2014, our Compensation Committee requested that Compensia review our compensation peer group and recommend any appropriate updates.
Compensia recommended an update to the compensation peer group based on management input as to companies with whom we may compete for executive talent. All of the companies included in the compensation peer group are providers of digital marketing intelligence or related analytical products and services, marketing services and solutions or survey services. Upon consultation with our Compensation Committee and management, as well as upon conducting independent research, Compensia recommended and our Compensation Committee used the following peer group throughout 2014:
this CD&A.
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Constant Contact
Costar Group
Dealertrack Technologies
Dice Holdings
Liquidity Services
| LivePerson
LogMeIn
MicroStrategy
OpenTable
QuinStreet
| Responsys
Synchronoss Technologies
Vocus
Web.com Group
WebMD Health
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Compensia provided a report to our Compensation Committee in January 2014 with observations and analyses regarding the direct compensation levels of our named executive officers. The 2014 study referenced both published compensation survey data of comparably-sized companies targeting a range of companies with revenues from half to twice our revenues and the compensation peer group. In February 2014, Compensia further reviewed the proposed compensation levels to reflect the Chief Executive Officer transition announced in February 2014. In March 2014, Compensia assisted our Compensation Committee in reviewing proposed adjustments to compensation for our executive officers to reflect the scope of responsibilities they would hold after Chief Executive Officer transition.
Our Compensation Committee considered the 50th percentile of the competitive market when making its decisions with respect to individual compensation components as it believed that such positioning would be at a competitive level for our named executive officers as well as consistent with industry practices in the technology sector. In making this determination, our Compensation Committee considered such factors as our stage of development, the size and characteristics of our Company, based on both headcount and operations and balance sheet characteristics, the expected future characteristics of our business relative to our compensation peer group the individual’s seniority, position and functional role, level of responsibility, accomplishments against personal and group objectives, and the compensation analysis prepared by Compensia. In addition, our Compensation Committee considered the market for corresponding positions within comparable geographic areas and industries as well as the state of our business and our cash flows.
Key 2014 Compensation Actions
Chief Executive Officer Transition
As announced on February 11, 2014, Dr, Abraham transitioned from service as our Chief Executive Officer to assume a new role as Executive Chairman of our Board of Directors effective March 1, 2014. Mr. Matta, our President, was appointed to the position of President and Chief Executive Officer. In connection with this transition, our Compensation Committee, in consultation with Compensia, approved the following compensation actions:
Mr. Matta:
With respect to Mr. Matta, our Compensation Committee:
Increased his annual base salary from $415,000 to $475,000;
Increased his annual incentive target opportunity to $700,000;
Increased his target performance-based long-term incentive opportunity to $700,000;
Increased his annual time-based long-term incentive opportunity to $700,000; and
Granted him a one-time "promotion" equity award in the form of a restricted stock unit award for 44,459 shares of our common stock as follows:
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◦ | One-half of the award, or 22,230 shares, would be earned based on our actual achievement as compared against company-level performance objectives established for 2014, and |
| |
◦ | One-half of the award, or 22,229 shares, to vest in three equal annual installments in February 2015, 2016, and 2017, all subject to his continued service on each respective vesting date. |
Dr. Abraham:
With respect to Dr. Abraham, our Compensation Committee:
At his request, reduced his annual base salary from $500,000 to $250,000, to be paid in the form of restricted shares of our common stock in lieu of cash;
Agreed that the restricted stock unit award for 96,666 shares of our common stock originally granted to him in 2012, while he was serving as Chief Executive Officer, and which was to be subject to the achievement of company-level performance objectives established in 2014, would remain in force, with the performance objectives realigned to focus on Dr. Abraham's responsibilities in connection with the Chief Executive Officer transition, and as Executive Chairman;
Agreed that the restricted stock unit award for 96,666 shares of our common stock originally granted to him in 2012, while he was serving as Chief Executive Officer, and which was to reward the overachievement of the 2014 performance objectives, would be reduced by 50% to a restricted stock unit award for 48,333 shares of our common stock, with the performance objectives realigned to focus on Dr. Abraham's responsibilities in connection with the Chief Executive Officer transition, and as Executive Chairman; and
Agreed that the restricted stock award for 70,000 shares of our common stock, originally granted to him in 2012, while he was serving as Chief Executive Officer, for retention purposes would be allowed to continue vesting in accordance with its original terms, subject to Dr. Abraham's continued service through March 2015.
Chief Financial Officer Transition
On August 4, 2014, we announced the appointment of Mr. Wesley as our Chief Financial Officer. This appointment followed Mr. Tarpey's May 8, 2014 announcement that he intended to retire from the Company. In connection with this transition, our Compensation Committee, in consultation with Compensia, approved an employment offer letter with Mr. Wesley providing for the following:
A base salary of $320,000;
A target annual incentive opportunity of $240,000, based on achievement of 2014 performance objectives;
A target performance-based long-term incentive opportunity of $450,000, based on achievement of 2014 performance objectives, but with any shares earned subject to a three-year time-based vesting requirement; and
Eligibility for a time-based long-term incentive in the amount of $300,000 subject to a three-year vesting requirement.
In addition, our Compensation Committee also granted Mr. Wesley a one-time "new-hire" equity award in the form of a restricted stock unit award for 10,000 shares of our common stock, to vest in three equal annual installments in August 2015, 2016 and 2017.
Special Market-Based Equity Awards for Executive Officers
On November 7, 2014, our Compensation Committee granted a special market-based performance equity award to our Chief Executive Officer as well as our other named executive officers. These awards, as further discussed below, were comprised of a mix of stock options as well as restricted stock units. The number of shares of our common stock subject to the restricted stock units and options granted was calculated based on a percentage of the aggregate market capitalization increase that our Compensation Committee sought to achieve through the awards. The awards were designed to motivate our Chief Executive Officer and management to drive sustained enterprise value toward a significantly higher market capitalization through 2017.
To achieve this objective, both the restricted stock units and the option awards were to vest (in the case of the options, to become exercisable) only upon the achievement of pre-established stock-price targets ranging from $48.00 to $60.00 per share. Based on a careful analysis of our Company's historic stock price performance, our Compensation Committee believed that to attain these stock-price targets to be challenging and attainable only by performance far in excess of our previous annual sales levels. Instead, our Compensation Committee believed that, to achieve these stock-price targets, it would be necessary for us to continue to expand our business relationships with existing and new strategic customers and to enter into strategic alliances with one or more third parties. For example, the lowest stock-price target of $48.00 per share represented a 25% increase in the market value of our common stock as measured by the 30-day average trading price of our common stock as of the date of the award bearing in mind that the trading price of our common stock already had increased 161% over the preceding 12 months. This market-based program would require a minimum market capitalization growth of $322 million (or 25% growth) to achieve the initial stock-price target, and additional targets of up to a maximum market capitalization growth of $721 million (or approximately 50% growth), assuming basic shares outstanding remained constant.
Chief Executive Officer Compensation
In 2014, our newly-appointed Chief Executive Officer's compensation was primarily performance-focused. Approximately 54% of Mr. Matta’s target total direct compensation (excluding his promotion and market-based awards) was variable in nature and "at risk." In addition, the performance-based components of his total direct compensation opportunity provided for an above-target payment in the event of strong overachievement.
Executive Compensation Program Elements
Our executive compensation program consistshas historically consisted of three primary elements: base salary, performance-basedannual incentive opportunities and a long-term time-based compensation opportunities. Aside from base salary, the other compensation elements are distributed in the form of equity awards, which we use to further align our executive officer's interests with stockholder interests.
Our Compensation Committee evaluates executive compensation and strives to apply the mix of these elements inlong-term incentive compensation. We also offer health and welfare benefits and certain separation-related benefits. Although we do not have a manner consistent with our compensation philosophy while meeting our objectives to attract and retain top talent using compensation that is consistent with or more attractive than other opportunities while also adjusting for individual relative performance and responsibilities as well as our business goals. Our Compensation Committee has no formal policy for allocating executive compensation among the primary compensation componentselements, our Compensation Committee seeks to provide compensation opportunities that are consistent with our philosophy described above.
Base Salary
BaseTo this end, base salary isdecisions in 2019 were guided primarily by our objective of attracting and retaining top executive talent. As in prior years, we used base salary to recognize the experience, skills, knowledge and responsibilities required of each namedour executive officer, as well asofficers.
As described above, we temporarily replaced our formulaic annual incentive compensation program for executive officers in 2019 with awards based on achievement of strategic objectives. This change was intended to reflect competitive market practice. Asreward performance while recognizing the efforts of our executive team to maintain normal business operations during a period of great change for the company. For 2020, our Compensation Committee initially considered our named executive officers’has returned to a more traditional annual incentive compensation for 2014, base salary determinations were guided primarily by our objective to provide compensation at levels to attract and retain top talent. Also, in early 2014,structure.
Finally, as described above, our Compensation Committee evaluated the base salaries ofsuspended our namedlong-term incentive program for continuing executive officers in light2019. For our new executive officers, the Compensation Committee designed equity award opportunities to be aligned with value creation for our stockholders.
Executive Compensation Actions and Decisions for 2019
Our Compensation Committee did not undertake its regular annual review of
our executive compensation program and each executive officer’s compensation during 2019. Instead, compensation decisions were made on acase-by-case
basis, taking into account the
situation that confronted the company at the time that we needed to appoint a new executive officer, address the circumstances relating to a departing executive officer, or respond to the incentive and retention challenges that were presented for continuing executive officers. These decisions are described below. Chief Executive Officer transition announcedTransition (March 2019)
On March 31, 2019, Mr. Wiener resigned as our Chief Executive Officer. In connection with his resignation, the company and madeMr. Wiener entered into a Separation Agreement pursuant to which he received:
cash severance equal to the sum of one year of base salary adjustmentsand one year of target annual incentive opportunity, half of which was paid in installments in 2019 and the other half of which was paid in a lump sum in March 2020, subject to certain mitigation and forfeiture provisions;
a target bonus for 2019 of $65,000, subject to achievement of applicable performance goals and representing a portion of his annual incentive opportunity for service through March 31, 2019 (see “Annual Bonuses” below for payment information);
reimbursement of the cost of continuation healthcare coverage for up to 18 months;
reimbursement of certain legal expenses;
accelerated vesting of 61,335 outstanding restricted stock units, representing hissign-on
award and a portion of his 2018 long-term incentive award; and satisfaction of the service requirement with respect to 36,347 outstanding performance-based restricted stock units, which will remain eligible to be earned subject to achievement of the applicable performance goals.
Under his Separation Agreement, Mr. Wiener agreed to a comprehensive release of claims and reaffirmed his commitment to be bound by restrictive covenants regarding confidential information,non-disparagement,
non-competition
andnon-solicitation.
Additional information regarding amounts paid to Mr. Wiener under his Separation Agreement is set forth under “Payments Upon Termination or Change in Control” below. Upon Mr. Wiener’s resignation, our Board of Directors appointed Mr. Fuller as Interim Chief Executive Officer. The company and Mr. Fuller entered into a letter agreement to memorialize the terms of his interim service, pursuant to which he received:
base salary of $25,000 per week;
a monthly stipend of $2,000 for temporary living expenses; and
aone-time
grant at the end of his interim term of a number of deferred shares equal to (a) $25,000 per week of service, divided by (b) the volume-weighted average price for the 10 consecutive trading days immediately preceding the date of grant (see “Chief Executive Officer Transition (November 2019)” for additional information about this grant). During his term as Interim Chief Executive Officer, Mr. Fuller did not receive any additional compensation for his service as a member of our Board of Directors; however, the outstanding restricted stock units granted to him as anon-employee
director in July 2018 continued to vest. In negotiating Mr. Fuller’s compensation terms, our Compensation Committee considered the temporary nature of his assignment and the fact that he would not be eligible for annual or long-term incentive compensation opportunities as Interim Chief Executive Officer. The Compensation Committee also considered the need to align Mr. Fuller’s interests with the long-term interests of our stockholders, resulting in the decision to deliver a substantial portion of his total direct compensation in deferred stock.
On March 31, 2019, Ms. Hofstetter resigned as our President. In connection with her resignation, the company and Ms. Hofstetter entered into a Separation Agreement pursuant to which she received:
cash severance equal to one year of base salary, which was paid in installments over 12 months, subject to certain mitigation and forfeiture provisions;
a target bonus for 2019 of $42,000, subject to achievement of applicable performance goals and representing a portion of her annual incentive opportunity for service through March 31, 2019 (see “Annual Bonuses” below for payment information);
reimbursement of the cost of continuation healthcare coverage for up to 12 months;
reimbursement of certain legal expenses;
an additional cash payment representing the remainder of hersign-on
bonus from 2018; accelerated vesting of 18,417 outstanding restricted stock units, representing a portion of hersign-on
award; and satisfaction of the service requirement with respect to 8,524 outstanding performance-based restricted stock units, which will remain eligible to be earned subject to achievement of the applicable performance goals.
Under her Separation Agreement, Ms. Hofstetter agreed to a comprehensive release of claims and reaffirmed her commitment to be bound by restrictive covenants regarding confidential information,non-disparagement,
non-competition
andnon-solicitation.
Additional information regarding amounts paid to Ms. Hofstetter under her Separation Agreement is set forth under “Payments Upon Termination or Change in Control” below. Chief Commercial Officer Appointment
Effective April 17, 2019, Mr. Wilson was appointed as our Chief Commercial Officer. Mr. Wilson was rehired as an executive officer following a term as a consultant to the company, during which he received consulting fees of $10,546. Prior to his consulting term, Mr. Wilson served as our Chief Revenue Officer until December 31, 2018. In connection with his departure as Chief Revenue Officer, Mr. Wilson received cash severance installments totaling $88,636 and reimbursement of continuation healthcare premiums of $9,146 in 2019, which severance installments and continuation coverage ended upon his reemployment. Mr. Wilson’s outstanding equity awards continued to vest during his consulting term and reemployment.
Mr. Wilson’s appointment as Chief Commercial Officer included the following initial compensation terms:
an annualized base salary of $375,000;
eligibility to participate in our annual incentive compensation program, with a target award of $450,000 for 2019;
continued vesting of a retention bonus awarded in 2018;
aone-time
grant of 41,254 restricted stock units, intended to make Mr. Wilson whole for compensation opportunities lost in 2018, when he did not participate in our long-term incentive compensation program; aone-time
grant of options to purchase 150,000 shares of our Common Stock, vesting over four years; aone-time
grant of 225,000 performance-based restricted stock units, vesting through May 22, 2029 subject to the achievement of specified stock-price hurdles (ranging from $21.00 to $60.00, equivalent to roughly 200% to 580% of our stock price on the date of grant), which hurdles must be maintained for at least 65 consecutive trading days during the applicable vesting period; reimbursement of up to $38,700 in legal expenses; and
a Change of Control and Severance Agreement with the company, the material terms and conditions of which are described under “Payments Upon Termination or Change in Control” below.
In evaluating compensation terms for Mr. Wilson, our Compensation Committee considered the importance of linking a substantial portion of Mr. Wilson’s target direct compensation to performance. The Compensation Committee also considered analyses prepared by, and discussions with, its compensation consultant. Finally, as noted above, the Compensation Committee considered compensation opportunities lost by Mr. Wilson in connection with his earlier separation as Chief Revenue Officer.
Chief Operating Officer Term
Effective April 17, 2019, Ms. Bachmann was appointed as our Chief Operating Officer. Ms. Bachmann previously served as anon-executive
employee of the company, and she received aone-time
grant of 6,779 restricted stock units in February 2019 in connection with hernon-executive
role. Ms. Bachmann’s compensation terms, including her base salary of $350,000 and annual incentive compensation target of 50% of base salary, did not change in connection with her appointment as Chief Operating Officer. On May 29, 2019, Ms. Bachmann resigned as our Chief Operating Officer. In connection with her resignation, the company and Ms. Bachmann entered into a Separation Agreement pursuant to which she received cash severance equal to four months of base salary, which was paid in a lump sum in 2019, and reimbursement of the cost of continuation healthcare coverage for up to six months. Under her Separation Agreement, Ms. Bachmann agreed to a comprehensive release of claims and reaffirmed her commitment to be bound by restrictive covenants regarding confidential information,non-competition
andnon-solicitation.
Additional information regarding amounts paid to Ms. Bachmann in connection with her Separation Agreement is set forth under “Payments Upon Termination or Change in Control” below. Chief Financial Officer Special Bonus
On May 6, 2019, our Compensation Committee approved a special retention bonus for Mr. Fink. Under the bonus, Mr. Fink was eligible to receive $500,000 in cash, contingent on his continued employment through December 15, 2019 and payable on the later of March 1, 2020 or the date we filed our Annual Report on Form10-K
for 2019. Mr. Fink was paid the special bonus in March 2020. Chief Executive Officer Transition (November 2019)
On November 4, 2019, our Board of Directors appointed Mr. Livek as our Chief Executive Officer and Executive Vice Chairman. Mr. Livek previously served as our Vice Chairman since January 2016 and was our President from January 2016 through May 2018, and he served as a special advisor to the company from May 2018 until his appointment as Chief Executive Officer in November 2019. In his role as special advisor, Mr. Livek received an annualized base salary of $443,700 and continued to vest in his outstanding equity awards.
In connection with his appointment as Chief Executive Officer, we and Mr. Livek entered into a letter agreement that included the following compensation terms:
an annualized base salary of $650,000;
eligibility to participate in our annual incentive compensation program, with a target award equal to 100% of base salary;
eligibility to participate in our long-term incentive compensation program;
aone-time
grant of 175,000 restricted stock units, vesting ratably over three years; aone-time
grant of options to purchase 300,000 shares, vesting ratably over three years; aone-time
grant of 425,000 performance-based restricted stock units, vesting quarterly through November 4, 2029 subject to the achievement of specified stock-price hurdles (ranging from $5.00 to $10.00, equivalent to roughly 210% to 420% of our stock price on the date of grant), which hurdles must be maintained for at least 65 consecutive trading days during the applicable vesting period; and payment of $200,000 in legal expenses.
Additionally, Mr. Livek is eligible to receive aone-time
bonus of at least $1,000,000 (either individually or as part of a larger pool for executive officers or employees) upon the successful completion of a refinance of all or substantially all of our outstanding senior secured convertible notes, generally subject to Mr. Livek’s continued employment through such refinance. Upon the consummation of a qualifying change in control, as defined in the letter agreement, Mr. Livek will receive aone-time
bonus of $1,000,000, plus an additionalone-time
bonus based on
specified percentages (ranging from 0.30% to 0.32%) of the
changed roles,gross transaction proceeds resulting from such change in control so long as the change in control results in gross transaction proceeds of at least $500 million. Each bonus payable upon the consummation of a change in control is generally subject to Mr. Livek’s continued employment through the change in control. Finally, Mr. Livek will continue to be eligible to receive the benefits set forth in his Change of Control and Severance Agreement with the company, as described under “Payments Upon Termination or Change in Control” below. In evaluating compensation terms for Mr. Livek, our Compensation Committee considered his 40 years of experience in media and consumer measurement, as well as the expected transition-related responsibilities that continuedstrategic value of his past and future contributions to the company. The Compensation Committee also considered input from its compensation consultant, particularly with Dr. Abrahamrespect to Mr. Livek’s equity awards and special bonus opportunities. Finally, the Compensation Committee sought to align Mr. Fulgoni.
The base salaries of eachLivek’s interests with those of our executive officers are reviewed on an annual basisstockholders, including by linking a substantial portion of his target direct compensation to sustained improvement in our stock price, and if determined appropriate, adjustments are made following each fiscal year based, withinanother portion to the contextsuccessful completion of a refinance or qualifying change in control with transaction proceeds significantly exceeding our overall annual meritcurrent market capitalization.
increase structure, and at other timesIn connection with Mr. Livek’s appointment, Mr. Fuller resigned as appropriate, in each case to reflect performance-based factors, marketplace conditions and the overall performance of our business, and based on the recommendation of ourInterim Chief Executive Officer.
The following table sets forthOfficer on November 4, 2019. On the annualized base salaries for 2013 and 2014 for each named executive officer:
|
| | | | | | | | |
| Name | 2013 | 2014 | Percentage Change |
|
| Serge Matta | $ | 415,000 |
| $ | 475,000 |
| 14.5 | % |
| Magid M. Abraham, Ph.D. | 500,000 |
| 250,000(1) |
| (50.0 | )% |
| Gian M. Fulgoni | 375,000 |
| 375,000(1) |
| 0.0 | % |
Kenneth J. Tarpey (retired August 28, 2014) | 367,500 |
| 367,500 |
| 0.0 | % |
| Cameron Meierhoefer | 321,000 |
| 353,000 |
| 10.0 | % |
| Christiana Lin | 302,500 |
| 333,000 |
| 10.0 | % |
| |
(1) | For the period from January 1, 2014 through December 31, 2014, in lieu of receiving a cash salary, each of Dr. Abraham and Mr. Fulgoni received an award of shares of our common stock with a value equal to the amount of salary foregone by each, less amounts paid to them in cash during 2014 to cover health benefits, based on the closing price of our common stock as reported on the NASDAQ Global Market at the close of trading on March 31, 2014, June 30, 2014, September 30, 2014 and December 31, 2014. The number of shares of our common stock delivered to each named executive officer was reduced by the number of shares necessary to satisfy applicable tax withholding requirements. |
Incentive Compensation
Both our annual and long-term incentive compensation arrangements are equity-based. By using equity to compensate our named executive officers for successfully completing the objectives in our annual operating plan and sharing in the long-term results of their efforts, we believe that we are closely aligning their interests with the interests of our stockholders. Our the components of our 2014 Executive Compensation Bonus Policy is further described below:
Annual Incentive Compensation
We provide annual incentive compensation to our named executive officers payable entirely in shares of our common stock. Pursuant to these award opportunities, our named executive officers may earn shares of our common stock based on our corporate and their individual performance. Our named executive officers must remain employed through the date thatsame day, our Compensation Committee makes its determinationsawarded 354,546 deferred stock units to Mr. Fuller as to the prior year’s performance to earn these shares.
Target Annual Incentive Award Opportunities. At the beginning of 2014, our Compensation Committee established target annual incentive award opportunitiescompensation for each of our then-named executive officers (other than Dr. Abraham). The amount of each named executive officer’s target annual incentive award opportunity was determined by our Compensation Committee after consideration of the compensation analysis prepared by Compensia, the previously-announcedhis service as Interim Chief Executive Officer, transition,in accordance with the recommendations of our Chiefcompensation arrangement described under “Chief Executive Officer (except with respect to his own target annual incentive award opportunity), and the other factors describedTransition (March 2019)” above. The target annual incentive award opportunitiesdeferred stock units will be delivered to Mr. Fuller in shares upon the earlier of our named executive officers were as follows:
|
| | | | | | |
| Name | Target Annual Incentive Award Opportunity ($) |
| Maximum Annual Incentive Award Opportunity ($) |
|
| Serge Matta | $ | 700,000 |
| $ | 1,400,000 |
|
| Gian M. Fulgoni | 375,000 |
| 750,000 |
|
Kenneth J. Tarpey (retired August 28, 2014) | 275,625 |
| 551,250 |
|
| Cameron Meierhoefer | 264,750 |
| 529,500 |
|
| Christiana Lin | 249,750 |
| 499,500 |
|
The amount of each of these annual incentive award opportunities was determined by our Compensation Committee based on a weighted mix of quantitative and qualitative performance factors. Each named executive officer was eligible to receive an award with a value from zero to 200% of his or her target annual incentive award opportunity contingent on our actual performance for the year.
Mr. Wesley’s target annual incentive award opportunity was established by our Compensation Committee at $240,000 (with a maximum annual incentive award opportunity of $480,000) when he joined us as our Chief Financial Officerchange in August 2014.
Weighting of Target Annual Incentive Award Opportunities. The target annual incentive award opportunity for our Chief Executive Officer was weighted entirely on corporate performance objectives, with the target annual incentive award opportunities of our other named executive officers were weighted as follows:
|
| | | |
| Name | Corporate Performance Objective - Revenue | Corporate Performance Objective - Adjusted EBITDA | Individual Performance Objectives |
| Serge Matta | 50% | 50% | N/A |
| Gian M. Fulgoni | 80% | N/A | 20% |
Kenneth J. Tarpey (retired August 28, 2014) | 80% | N/A | 20% |
| Cameron Meierhoefer | 50% | N/A | 50% |
| Christiana Lin | N/A | N/A | 100% |
Corporate Performance Objectives. At the beginningcontrol of the year, our Compensation Committee selected revenue and adjusted earnings before interest, taxes, depreciation, and amortization (“Adjusted EBITDA”) as the corporate performance measures for the 2014 annual incentive awards. Our Compensation Committee believed these performance measures were appropriate for our business because theycompany or six months following his separation from service.
Finally, we entered into a consulting agreement with Mr. Fuller on November 8, 2019, pursuant to which he provided a balance between generating revenue, managing our expenses, and growing our business, which it believes most directly influence long-term stockholder value. For purposes of the annual incentive awards, Adjusted EBITDA was defined to mean earnings before income taxes, amortization of intangible assets, stock-based compensation, costs related to acquisitions, restructuring and other infrequently occurring items, depreciation, interest and other expense.
The threshold, target, and maximum performance levels for these measures were as follows:
|
| | | |
Performance Measure | Threshold Performance | Target Performance | Maximum Performance |
Revenue | $311 million | $322 million | $334 million |
Adjusted EBITDA | $57.5 million | $63.0 million | $70.5 million |
Our Compensation Committee established the performance levels for each of these measures at amounts that it believed to be challenging, but attainable,transition services through the successful execution of our annual operating plan. In addition, each of these performance levels was assigned a payment amount commensurate with the reward that our Compensation Committee,December 31, 2019 in its judgment, believed was reasonable and appropriate for those results. Our
Compensation Committee determined that no payment would be made with respect to a performance measure if our actual achievement was less than the threshold level established for that measure. In addition, for actual achievement between the threshold and target, and target and maximum, performance levels, payments were to be calculated for each measure on a linear basis starting from 50% achievement at the threshold.
Individual Performance Objectives. In addition to the corporate performance objectives, the annual incentive awards were also based on each named executive officer’s achievement against his or her individual performance objectives. Individual performance objectives for each named executive officer were established at the beginning of the year in discussions with our Chief Executive Officer. These objectives could be quantitative or qualitative goals, depending on the organizational prioritiesreturn for a given year, and typically focused on key departmental or operational objectives or functions. Mostfee of these objectives were intended to provide a set of common goals that facilitated collaborative management and engagement, although our named executive officers could also be assigned individual goals. In all cases, the individual performance objectives were intended to be challenging, but attainable, and designed to produce annual incentive awards that reflected meaningful performance requirements.$50,000.
The individual performance objectives for our named executive officers (other than Mr. Matta and Dr. Abraham) were as follows:
| |
▪ | Mr. Fulgoni: assist with the Executive Chairman transition, continue investor relations work, reinforce our message among investors and analysts, and serve as a thought leader in support of our brand-building activities. |
| |
▪ | Mr. Tarpey: improve financial infrastructure and systems, improve management of international entity structure, improve operational efficiencies in the finance and accounting teams; expand sell side analyst coverage of our Company's performance |
| |
▪ | Mr. Wesley: learn comScore organization, products, and processes, review opportunities for improvement in finance organization and drive plans for implementing such improvements, providing strategic and practical oversight over comScore financial activities including structure, compliance, planning, forecasting and expense management, and, establishing leadership tone within the finance organization. |
| |
▪ | Mr. Meierhoefer: re-align our product and operational organizations to improve the effectiveness of these teams, develop and deploy critical technical data collection solutions, and attain critical new product capabilities, and integrate strategic data inputs into our flagship advertising analytics products, as well as launch our international mobile products and continue the development of cross platform solutions. |
| |
▪ | Ms. Lin: successful closure of strategic commercial and corporate deals, successful wind down of significant litigation matters, implement process, system, and operational improvements within the legal and human resources teams, and develop and maintain a strategic approach to managing our intellectual property portfolio and privacy-related efforts, and provide strategic advice and counsel to our executive officers as well as our Board of Directors. |
2014 Performance Results and Award Decisions. In February2015, our Compensation Committee determined that our actual achievement, and corresponding payment levels, with respect to the corporate performance objectives for 2014 were as follows:
Chief Commercial Officer Award Modification
|
| | | |
Performance Measure | Target Performance Level | Actual Performance Level | Performance as a Percentage of Target |
Revenue | $322 million | $329.2 million | 165 % |
Adjusted EBITDA | $63.0 million | $71.37 million | 200 % |
In addition, following his review of the performance of each named executive officer whose target annual incentive award opportunity was based, either in whole or in part, on individual performance objectives, our Chief Executive Officer submitted his recommendation to our Compensation Committee as to the appropriate level of achievement with respect to those objectives. Upon review of these recommendations,December 2019, our Compensation Committee determined that the individual performance objectives of each named executive officer had been attained at the following percentage levels:
|
| |
Name | Individual Performance Objectives Attainment Level |
Serge Matta | N/A |
Gian M. Fulgoni | 100% |
Melvin Wesley | 91% |
Cameron Meierhoefer | 92% |
Christiana Lin | 98% |
(1) Mr. Tarpey’s individual performance objective was not considered because he retired from the Company during 2014.
In February 2015, based on its review of our overall performance in 2014 against the corporate performance objectives and, to the extent applicable, the achievement of individual performance objectives, our Compensation Committee determined that our named executive officers had earned their annual incentive awards at the percentage levels reflected in the following table, which were payable in the form of shares of our common stock as follows:
|
| | | | | | | | | | |
| Name (1) | Target Annual Incentive Award Opportunity ($) |
| Actual Annual Incentive Award ($) |
| Actual Annual Incentive Award (number of shares) (2) |
| Actual Annual Incentive Achieved Against Target (%) |
|
| Serge Matta | $ | 700,000 |
| $ | 1,287,775 |
| 29,629 |
| 184 | % |
| Gian M. Fulgoni | 375,000 |
| 571,093 |
| 13,232 |
| 152 | % |
| Melvin Wesley III | 240,000 |
| 383,128 |
| 8,877 |
| 160 | % |
| Cameron Meierhoefer | 265,000 |
| 340,951 |
| 7,900 |
| 127 | % |
| Christiana Lin | 249,500 |
| 249,750 |
| 5,787 |
| 100 | % |
| |
(1) | Mr. Tarpey did not receive an annual incentive award because he retired from the Company during 2014. |
| |
(2) | The number of shares of our common stock received was determined based on the closing price of our common stock reported on the NASDAQ Global Select Market on February 11, 2015, which was$43.16per share.
|
Annual Incentive Compensation for Dr. Abraham
The annual incentive award opportunity of Dr. Abraham is based on the restricted stock unit (“RSU”) awards that were originally granted to him in 2012, while he was serving as Chief Executive Officer. These RSU awards provided him with the opportunity to earn up to 96,666 shares of our common stock for the achievement and an additional 96,666 shares of our common stock for the overachievement of one or more corporate performance objectives established by our Compensation Committee at the beginning of 2014. As described at the beginning of this Compensation Discussion and Analysis, in connection with his assumption of his new role as Executive Chairman of our Board of Directors these awards were modified my our Compensation Committee to provide Dr. Abraham with the opportunity to earn up to 96,666 shares of our common stock for the achievement and an additional 48,333 shares of our common stock for the overachievement of one or more performance objectives focused on his changed responsibilities and his continued involvement in shaping our product development and strategy activities for the year.
At the beginning of 2014, our Compensation Committee established individual performance objectives for Dr. Abraham, which were weighted as 50% of his target annual incentive award opportunity. These performance objectives involved certain activities related to assisting with the Chief Executive Officer transition and the development and improvement of strategic product initiatives with a focus on cross-platform products. To reinforce its intention that he continue to operate as a vital member of our management team, the remainder of his target
annual incentive award opportunity was equally divided between the two corporate performance objectives - revenue and adjusted EBITDA - that were used in connection with the target annual incentive award opportunities of our other named executive officers.
In February 2015, following its determination of our actual achievement with respect to the corporate performance objectives for 2014 and an assessment of Dr. Abraham’s performance against his individual performance objectives (which were determined to have been met in full), our Compensation Committee awarded him 116,648 shares of our common stock.
Long-Term Incentive Compensation
We provide our named executive officers with an annual long-term incentive compensation opportunity also payable entirely in shares of our common stock. As discussed below, these awards are earned, if at all, based entirely on our corporate performance. For 2014, the target long-term incentive awards granted to our named executive officers (other than Dr. Abraham) were as follows:
|
| | | | | | |
| Name and Principal Position | Target Annual Incentive Award Opportunity ($)
|
| Maximum Annual Incentive Award Opportunity ($) |
|
| Serge Matta | $ | 700,000 |
| $ | 1,400,000 |
|
| Gian M. Fulgoni | 275,000 |
| 500,000 |
|
Kenneth J. Tarpey (retired August 28, 2014) | 150,000 |
| 300,000 |
|
| Cameron Meierhoefer | 450,000 |
| 900,000 |
|
| Christiana Lin | 450,000 |
| 900,000 |
|
Mr. Wesley’s target long-term incentive award opportunity was established by our Compensation Committee at $450,000 (with a maximum annual incentive award opportunity of $900,000) when he joined us as our Chief Financial Officer in August 2014.
Any shares of our common stock earned pursuant to these awards immediately vested as to one-third of such earned shares upon the date of determination by our Compensation Committee in 2015 as to our actual performance results, and the remaining two-thirds of such earned shares vest in two equal installments on the first and second anniversaries of the date of determination by our Compensation Committee, subject to continued employment through each of the vesting dates.
Corporate Performance Measures and Relative Weightings. At the beginning of the year, our Compensation Committee selected revenue and Adjusted EBITDA as the corporate performance measures for the 2014 long-term incentive awards. Our Compensation Committee believed these performance measures were appropriate for our business because they provided a balance between generating revenue, managing our expenses, and growing our business, which it believes most directly influence long-term stockholder value. The threshold, target, and maximum performance levels for these measures were as follows:
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| | | |
Performance Measure | Threshold Performance | Target Performance | Maximum Performance |
Revenue | $311 million | $322 million | $334 million |
Adjusted EBITDA | $57.5 million | $63.0 million | $70.5 million |
Our Compensation Committee established the performance levels for each of these measures at amounts that it believed to be challenging, but attainable, through the successful execution of our annual operating plan. In addition, each of these performance levels was assigned a payment amount commensurate with the reward that our Compensation Committee, in its judgment, believed was reasonable and appropriate for those results. Our Compensation Committee determined that no payment would be made with respect to a performance measure if our actual achievement was less than the threshold level established for that measure. In addition, for actual
achievement between the threshold and target, and target and maximum, performance levels, payments were to be calculated for each measure on a linear basis starting from 50% achievement at the threshold.
The performance measures were weighted to apply to the long-term incentive award of each named executive officer as follows:
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| | |
| Name | Corporate Performance Objective - Revenue | Corporate Performance Objective - Adjusted EBITDA |
| Serge Matta | 50% | 50% |
| Gian M. Fulgoni | N/A | 100% |
Kenneth J. Tarpey (retired August 28, 2014) | N/A | 100% |
| Cameron Meierhoefer | N/A | 100% |
| Christiana Lin | N/A | 100% |
Performance Results and Award Decisions. In February2015, our Compensation Committee determined that our actual achievement, and corresponding payment levels, with respect to the corporate performance objectives for 2014 were as follows:
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| | | |
Performance Measure | Target Performance Level | Actual Performance Level | Performance as a Percentage of Target |
Revenue | $322 million | $329.2 million | 165 % |
Adjusted EBITDA | $63.0 million | $71.37 million | 200 % |
At that time, based on its review of our overall performance in 2014 against the corporate performance objectives, our Compensation Committee determined that our named executive officers had earned their long-term incentive awards at a percentage level and which were payable in the form of shares of our common stock as follows:
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| | | | | | | | | | |
| Name (1) | Target Annual Incentive Award Opportunity ($) |
| Actual Annual Incentive Award ($) |
| Actual Annual Incentive Award (number of shares) (2) |
| Actual Annual Incentive Achieved Against Target (%) |
|
| Serge Matta | $ | 700,000 |
| $ | 1,287,775 |
| 29,629 |
| 184 | % |
| Gian M. Fulgoni | 275,000 |
| 500,000 |
| 11,585 |
| 200 | % |
| Melvin Wesley III | 450,000 |
| 900,000 |
| 20,853 |
| 200 | % |
| Cameron Meierhoefer | 450,000 |
| 900,000 |
| 20,853 |
| 200 | % |
| Christiana Lin | 450,000 |
| 900,000 |
| 20,853 |
| 200 | % |
| |
(1) | Mr. Tarpey did not receive an annual incentive award because he retired from the Company during 2014. |
| |
(2) | The number of shares of our common stock received was determined based on the closing price of our common stock reported on the NASDAQ Global Select Market on February 11,2015, which was$43.16per share.
|
Additional Time-Based Long-Term Incentive Compensation Award
In February 2014, following consultation with Compensia, and a review of competitive market data, our Compensation Committee determined that, to support our retention objectives, it was appropriate to introduce a time-based equity award to our long-term incentive compensation program. The purpose of this award was to ensure that each of our named executive officers has a minimum amount of time-based equity representing between 80% to 100% of his or her annual base salary to be earned over a multi-year period (initially 3 years) subject to continued employment with us. The initial time-based equity award approved for our named executive officers were based on a specific dollar amount and ultimately paid in shares of our common stock as follows:
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| | |
| Name (1) | Long-Term Time-Based Equity Award ($) | Long-Term Time-Based Award (number of shares) (2) |
| Serge Matta | $700,000 | 16,219 |
| Gian M. Fulgoni | N/A | N/A |
| Melvin Wesley III(3) | 300,000 | 6,951 |
| Cameron Meierhoefer | 300,000 | 6,951 |
| Christiana Lin | 300,000 | 6,951 |
| |
(1) | Mr. Tarpey did not receive an additional time-based long-term incentive award because he retired from the Company during 2014. |
| |
(2) | The number of shares of our common stock received was determined based on the closing price of our common stock reported on the NASDAQ Global Select Market on February 11,2015, which was$43.16per share. These awards immediately vested as to one-third of such shares upon the date of determination by our Compensation Committee in 2015, and the remaining two-thirds of such shares vest in two equal installments on the firsts and second anniversaties of the date of determination by our Compensation Committee, subject to continued employment through each of the vesting dates.
|
| |
(3) | Mr. Wesley's time-based long-term incentive award was approved by our Compensation Committee when he joined us as our Chief Financial Officer in August, 2014. |
“New Hire” Equity Award for Mr. Wesley
Typically, upon joining us, a new named executive officer will be granted an initial equity award, the value of which will be determined primarily based on competitive conditions applicable to the individual’s specific position as well as the individual’s qualifications in light of these competitive conditions. In addition, in making this award our Compensation Committee will consider the number of shares of our common stock subject to the outstanding equity awards held by our other executive officers in comparable positions. In August 2014, our Compensation Committee granted Mr. Wesley an equity award in the form of a restricted stock unit (“RSU”) award for 10,000 shares of our common stock, to vest in equal annual installment over three years, subject to his continued employment through each of the vesting dates.
Promotion Equity Awards for Mr. Matta
Periodically, our Compensation Committee grants equity awards to our named executive officers in recognition of a promotion and/or an increase in his or her role or responsibilities. In connection with Mr. Matta's promotion to our Chief Executive Officer in February 2014, our Compensation Committee granted him an equity award in the form of an RSU award for 44,459 shares of our common stock, with 50% of the award, or 22,230 shares, to be earned based on the achievement of corporate performance objectives established for 2014, and the remaining 50%, or 22,229 shares, to vest in equal annual installments in February 2015, 2016, and 2017, all subject to his continued employment through each of the vesting dates.
With respect to the performance-based portion of this RSU award, our Compensation Committee selected annual revenue and Adjusted EBITDA as the corporate performance measures, with the related target level for each measure established in an amount equal to the target levels established for his annual incentive award.
Retention Equity Awards for Mr. Meierhoefer and Ms. Lin
In February 2014, Mr. Matta recommended, and our Compensation Committee approved, additional equity awards in the form of an RSU award for 7,500 shares of our common stock to each of Mr. Meierhoefer and Ms. Lin, to recognize the efforts that would be required by these named executive officers to assist Mr. Matta in achieving the 2014 corporate performance objectives set for him. Similar to the promotional equity award granted to Mr. Matta, 50%Wilson in May 2019 no longer provided an appropriate level of this award was performance-based, and 50% ofincentive or retention value, as the stock-price hurdles set forth in the award was time-based, with vestingas performance conditions exceeded our then-current stock price by up to occur over three years, all subject to his or her continued employment through each of the vesting dates.
Special Market-Based Equity Awards
On November 7, 2014, our Compensation Committee granted a special market-based equity award to1,280%. After considering input from its outside compensation consultant and our Chief Executive Officer,
and certainthe Compensation Committee modified Mr. Wilson’s award on December 16, 2019, reducing the range of stock-price hurdles from$21.00-$60.00
to$8.00-$15.00.
The revised hurdles, which must be maintained for at least 65 consecutive trading days during the applicable vesting period, equated to roughly 170% to 320% of our
other named executive officers. These awards were comprisedstock price on the date of
a mixmodification. The revised hurdles have not yet been achieved.
In February 2020, our Compensation Committee sought to achieve through the awards. These specialapproved cash bonus awards were designed to provide an additional incentive for ourcertain named executive officers as set forth below:
These bonuses, which replaced annual incentive compensation opportunities for 2019, were intended to drive sustained enterprise value toward a significantly higher market capitalization through 2017.
To achieve the desired growth, both the stock options and RSU awards provide that they would become exercisable (in the case of the options) and vest (in the case of the RSU awards) only upon thereward our continuing executive officers for their achievement of
pre-established stock-price target levels ranging from $48.00 per share to $60.00 per share. The sharesstrategic objectives, including strong cost management, achievement of
our common stock subject to these market-based equity awards will be earned in the following proportionspositive adjusted EBITDA1
, focus on corporate culture and
tone at the
following stock-price targets:
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| | | |
| | Stock-Price Target (per share) (1) | Percentage of Shares Subject to Stock Option That Will Become Exercisable | Percentage of Shares Subject to RSU Award That Will Vest |
| |
| | $48.00 | 66 % | 48 % |
| | $50.00 | 10 % | 10 % |
| | $55.00 | 14 % | 22 % |
| | $60.00 | 10 % | 20 % |
| |
(1) | Each stock-price target will be deemed satisfied when the closing market price of our common stock as reported by the NASDAQ Global Market exceeds the average of the target stock pricefor a consecutive 30-day period prior to November 17, 2017
|
The per share stock-price targetstop, remediation of internal control weaknesses identified in prior years, and enhancement of corporate compliance, security and privacy programs during a time of transition for the company. For Mr. Wiener and Ms. Hofstetter, bonuses were determined by our Compensation Committee using its desired future market capitalization levelspaid at the same level as compared to our “baseline” market capitalization as calculated ascontinuing employees (75% of November 7, 2014. Our baseline market capitalization was calculated usingtarget), with the number of basic shares outstanding multiplied by the 30-day average trading price for our common stock. Our Compensation Committee allocated the vesting percentages for eachtarget award between the various stock-price targets based on its judgment as to the level of effort that would be required to increase the market price of our common stock to the next target level.
Based onreflecting a careful analysis of our Company's historic stock price performance, our Compensation Committee set these stock-price targets to be challenging and attainable only by performance far in excess of our previous annual sales levels. Instead, our Compensation Committee believed that, to achieve these stock-price targets, it would be necessary for us to continue to expand our business relationships with existing and new strategic customers and to enter into strategic alliances with one or more third parties. For example, the lowest stock-price target of $48.00 per share represented a 25% increase in the market value of our common stock as measured by the 30-day average trading price of our common stock as ofproration through the date of the award bearingtermination, in mind that the trading price of our common stock already had increased 161% over the preceding 12 months.
Each stock option was grantedaccordance with an exercise price of $42.92 per share and each RSUtheir separation agreements. Mr. Livek’s award was granted with a fair value of $42.92 per share, the closing price of our common stock as reported by the NASDAQ Global Market on November 7, 2014.
Our Compensation Committee established the size of our Chief Executive Officer’s special award at a level that would approximate 2% of the market capitalization increase that would be realized by our stockholders at each pre-established stock-price target. In addition, our Compensation Committee established a pool of shares of our common stockprorated for allocation among our other named executive officershis base salary adjustment in its discretion, based on the recommendations of our Chief Executive Officer. The following table identifies each named executive officer who received a market-based equity award, as well as the number of shares of our common stock subject to the stock options and RSU awards granted to implement these awards:
|
| | |
| Name | Stock Option (number of shares) | Restricted Stock Unit Award (number of shares) |
| Serge Matta | 984,727 | 141,678 |
| Melvin Wesley III | 218,828 | 31,484 |
| Cameron Meierhoefer | 218,828 | 31,484 |
| Christiana Lin | 218,828 | 31,484 |
Other Compensation Elements
We provide the following welfarehealth and healthwelfare benefits to our named executive officers on the same basis as the benefits are provided to all our other U.S. employees:
health
medical and dental insurance;
life insurance;
short-and
short-term and long-term disability;disability insurance; and
a Section 401(k) plan.plan with a company matching feature.
These
We believe these benefits are consistent with those offered by other companies, and specificallyincluding those with those companies with whichwhom we compete for executive talent.
In general, we do not provide significant perquisites or other personal benefits to our executive officers, and thereforwe do not view perquisites and other personal benefits as a significant componentmaterial element of our executive compensation program. Our Compensation Committee has the authority to approve perquisites,We occasionally provide benefits, however, primarily for retention purposes orpurposes; to accommodate specific, and usually temporary, circumstances of executives who do not reside near their work locations.locations; or to primarily serve a business purpose that may result in ancillary personal benefit to the executive. Moreover, as described above, we have provided for reimbursement of attorneys’ fees in certain cases, including in connection with the negotiation of employment or separation terms.
| 1 | We define adjusted EBITDA as net income (loss) plus or minus interest, taxes, depreciation, amortization of intangible assets and finance leases, stock-based compensation expense, charges for matters relating to the prior-year Audit Committee investigation (such as litigation and investigation-related costs, costs associated with tax projects, audits, consulting and other professional fees), other legal proceedings specified in our senior secured convertible notes, settlement of certain litigation, restructuring expense, transaction costs related to the issuance of equity securities, non-cash impairment charges, andnon-cash changes in the fair value of financing derivatives, warrants liability and investments in equity securities. |
Change of Control and Severance Agreements
Our namedcontinuing executive officers are parties to various agreements that provide for certain payments and benefits to them in the event of a termination of their employment including in connection withor a change in control of our Company.
the company. We believe that post-employment compensationthese arrangements are usefulvaluable retention tools that are particularly necessary in an industry, such as ours, where there is frequent market consolidation. We recognize that it is possible that we may be subject to a change in control, and that this possibility could result in a sudden departure or distraction of our key executive officers to the detriment of our business. We believe that these arrangements help to encourage and maintain the continued focus and dedication of our named executive officers to their assigned duties to maximize stockholder value, withoutnotwithstanding the distraction that could result from the uncertaintypossibility or occurrence of a potentialchange in control of the company. We also believe that these arrangements are necessary to attract and retain critical members of management. These arrangements do not contain any tax reimbursement or actualtax “gross up” provisions for our executive officers.
The material terms and conditions of our executive change of control transaction. We also believe these arrangementsand severance agreements are competitive with arrangements offered to senior executives at companies with whom we compete for executive talent and are necessary to the achievement of our business objective of management retention.discussed under “Payments Upon Termination or Change in Control” below.
In 2015, in connection with this Chief Financial Officer transition, the Company entered into a Transition Agreement with Kenneth Tarpey. Under the terms of the Agreement, in addition to the benefits set forth in the Change of Control and Severance Agreement between Executive and Company dated July 20, 2010. In addition, Mr. Tarpey received a one-time distribution of shares based on a pro-rated calculation of his 2014 short-term incentive and the immediately vested performance-based portion of his 2014 long-term incentive pursuant to the Company’s 2014 executive incentive plan. The incentive achievement amounts will be determined based on the
Company’s first and second quarter revenue and Adjusted EBITDA results relative to the targets, with the assumption that Mr. Tarpey achieved 100% of any management based objectives for those periods.
Other Compensation Policies
Hedging TransactionsStock Ownership Guidelines
WhileIn 2018, our executive officers had not previously engaged in hedging transactions involving Company securities, we have adopted a formal policy that prohibits hedging or similar transactions to ensure that the members of our leadership team (including our named executive officers)Compensation Committee recommended, and the non-employee members of our Board of Directors bearadopted, stock ownership guidelines to further align the full risks of ownershiplong-term interests of our common stock.
Pledging Our Securities
While ourdirectors and executive officers hadwith those of our stockholders. Under the guidelines, each director is expected to own shares of Common Stock with a value equal to at least five times the director’s annual cash retainer for service on the Board. For executive officers, the Chief Executive Officer is expected to own shares of Common Stock with a value equal to at least five times his or her annual base salary, and the Chief Financial Officer, Chief Operating Officer and other named executives are expected to own shares of Common Stock with a value equal to at least three times their respective annual base salaries. Equity holdings that qualify toward satisfaction of the guidelines include shares underlying vested stock options (less the value of the aggregate exercise price), restricted stock and restricted stock units, and deferred stock units. Awards subject to performance conditions are not previously engagedcounted until such awards are earned. A director or executive officer has five years from the date of becoming subject to the guidelines to achieve compliance and must hold 100% of the net shares acquired upon vesting or exercise of any equity award until he or she has satisfied the guidelines.
Our clawback policy provides that (i) if an accounting restatement occurs, the Board will seek to recover (a) any excess incentive-based compensation from an executive officer determined to have committed misconduct resulting in the restatement and (b) any compensation recoverable from the Chief Executive Officer or Chief Financial Officer under Section 304 of the Sarbanes-Oxley Act of 2002; (ii) the Board will seek to recover any incentive-based compensation or other compensation from an executive officer if the compensation was determined to be based on financial results or operating metrics that were satisfied as a result of such executive officer’s knowing or intentional fraudulent or illegal conduct; and (iii) the Board will seek to recover from an executive officer any incentive-based compensation it determines was awarded due to an error in the calculation of such compensation.
Anti-Hedging and Pledging Policy
We maintain a robust anti-hedging and pledging ofpolicy, which prohibits our common stock, we have adopted a formal policy that prohibits thedirectors, executive officers, their family members and any entities they control from hedging and pledging of ourComscore equity securities as collateral for loans to ensure that a foreclosure onloan or purchasing such securities wouldon margin. More specifically, our policy prohibits covered persons from engaging in any type of hedging transaction with respect to Comscore equity securities, including but not trigger inadvertentlimited to short sales, options (other than options pursuant to our incentive compensation plans), puts, calls, collars and other derivative securities, monetization transactions, prepaid variable forward contracts, equity swaps and exchange funds.
Insider Trading Policy and Preclearance Requirements
Our insider trading violations.policy, which covers all directors, officers and employees of the company, prohibits the unauthorized disclosure of any nonpublic information acquired in the course of service with the company and the misuse of material nonpublic information in securities trading. The policy applies to all transactions involving Comscore securities or the securities of other
companies as to which material nonpublic information is obtained in the course of service with Comscore. Moreover, the policy covers any arrangements that affect economic exposure to changes in the prices of these securities, including transactions in derivative securities (such as put or call options), hedging transactions and short sales. The policy also prohibits trading or tipping based on material nonpublic information. We maintain quarterly trading blackout periods for all directors, officers and employees, and we require our directors, officers and employees with access to sensitive information to obtain preclearance for any transaction in Comscore securities, even during open trading windows.
Compensation Risk Assessment
Our Compensation Committee and management have considered whether our current compensation programs for employees create incentives for excessive or unreasonable risks that could have a material adverse effect on us. Ourthe company. This has included consideration of the Audit Committee investigation findings and the internal control weaknesses identified by management in prior years, as well as our decision to specify maximum payouts for incentive compensation, use multiple performance metrics and measurement periods, require Compensation Committee believesreview and validation of results and payouts, grant stock options to executive officers only during open trading windows (following the public release of quarterly earnings information), implement stock ownership guidelines, and maintain a clawback policy that allows for recovery of executive compensation in the event of an accounting restatement or fraud. We believe that our compensation programs, as currently designed, are consistent with practices for our industry and that the risks arising from our compensation policies and practices are not reasonably likely to have a material adverse effect on us.
2015 Executivethe company. In structuring future compensation programs and decisions, the Compensation Updates
In early 2015, in responseCommittee will continue to monitor whether our risk management objectives are being met with respect to incentivizing our employees. We will also monitor the announcement by our Company of entry into (i) a long term strategic alliance with Kantar, the data investment management division of WPP plc ("WPP"), establishing a framework for the parties to bring together their products, technology, data assets, research panels and relationships to provide global cross-media audience and campaign measurement capabilities, and (ii) an agreement whereby WPP would acquire a 15-20% equity stake in our Company, our stock price increased by over 20% and has sustained trading at this higher level for a number of months. As a result, in late February and early March 2015, the initial two tranchesimpact of the special market-based awards met the required stock-price thresholds to vest (or in the case of options, to become exercisable). This step-change in stock price represents the type of strategic initiatives needed to achieve the sustained increase in stock priceCOVID-19
pandemic, which did not affect our 2019 compensation decisions but could affect outcomes and market capitalization neededdecisions for our Company to meet the stock-price thresholds set by our Compensation Committee.future periods.Tax and Accounting Implications of Executive Compensation
Deductibility of Executive Compensation
We seek to design our executive compensation arrangements to be deductible underGenerally, Section 162(m) of the Internal Revenue Code but such treatmentof 1986, as amended, disallows public companies a tax deduction for federal income tax purposes of remuneration in excess of $1 million paid to certain executive officers. Pursuant to tax law changes effective in 2018, these executive officers include a public company’s chief executive officer, chief financial officer, and each of the three other most highly-compensated executive officers whose compensation is not guaranteed, asrequired to be disclosed to stockholders under the Securities Exchange Act of 1934 in any taxable year. In making compensation decisions, our Compensation Committee reservesmay consider the rightpotential effects of Section 162(m) on the compensation paid to pay or award our named executive officers compensation that may not be deductible by reason of the application of Section 162(m) if it determines that such payments or awards are in the best interests of our Company and our stockholders.officers.
Accounting for Stock-Based Compensation
We follow Financial Accounting StandardStandards Board Accounting Standards Codification Topic 718 or (“ASC Topic 718,718”) for our stock-based compensation awards. ASC Topic 718 requires companies to measure the compensation expense for all share-based payment awards made to employees and directors, including stock options and restricted stock unit awards, based on the grant date “fair value”fair value of these awards. ASC Topic 718 also requires companies to recognize
the compensation cost of their stock-based compensation awards in their income statements over the period that an executive officeraward recipient is required to render service in exchange for the optionaward. In making compensation decisions, our Compensation Committee regularly considers the cost of stock-based compensation awards and any proposed modifications to those awards.
Notwithstanding the foregoing discussion, our Compensation Committee believes that its primary responsibility is to provide a compensation program that is consistent with our compensation philosophy and that supports the achievement of our compensation objectives. Therefore, the Compensation Committee retains authority to grant appropriate compensation items or other award.awards to our service providers notwithstanding an adverse tax or accounting treatment for that compensation.
COMPENSATION COMMITTEE REPORT
Our compensation committeeThe Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis contained in this Annual Report on Form 10-K/Afiling with ourthe company’s management. Based on our compensation committee’sits review of, and the discussions with management with respect to, the Compensation Discussion and Analysis, our compensation committeethe Compensation Committee recommended to our Board of DirectorDirectors that the Compensation Discussion and Analysis be included in this Annual Report on Form 10-K/A for the fiscal year ended December 31, 2014 for filing with the Securities and Exchange Commission.filing.
Compensation Committee
William J. Henderson, Chairman
William KatzRussell Fradin
The foregoing
This Compensation Committee report shall not be deemed incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934 and shall not otherwise be deemed filed under these acts, except to the extent we specifically incorporate by reference into such filings.
EXECUTIVE COMPENSATION
20142019 Summary Compensation Table
The following table sets forth summary information concerning compensation for the following persons: (i) all persons serving as our chiefprincipal executive officer during 2014,2019, (ii) all persons serving as our chiefprincipal financial officer during 2014 and2019, (iii) the threenext two most highly compensated executive officers who were serving as of ourDecember 31, 2019 (we had no other executive officers as of December 31, 2019), and (iv) two additional individuals who received compensation during 2014 of at least $100,000 and who wereserved as executive officers onduring 2019 but were not serving as of December 31, 2014.2019. We refer to these personsindividuals as our “named executive officers” elsewhere in this proxy statement.filing. The following table includes all compensation earned by the named executive officers for the respective periods, regardless of whether such amounts were actually paid during the period.
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| Name and Principal Position | Year($) | Salary ($) | Stock Awards ($)(1) | Option Awards ($)(1) | All Other Compensation ($) | Total ($) |
Serge Matta President, Chief Executive Officer and Director | 2014 2013 2012 | $466,594 382,512 328,749 | $8,008,208(2) 2,981,384 1,098,484 | $8,547,430(3) ---- ---- | $3,137(4) 3,077 3,557 | $17,025,369 3,366,963 1,430,790 |
Magid M. Abraham, Ph.D. Executive Chairman of the Board of Directors | 2014 2013 2012 | 250,049(5) 500,000 500,008 | 3,044,012(6) 1,563,089(7) 6,673,052(8)
| ---- ---- ---- | 214(4) 213 176 | 3,294,275 2,063,302 7,173,236
|
Gian M. Fulgoni Chairman Emeritus and Director | 2014 2013 2012 | 375,079(9) 375,000 375,005
| 1,150,000(10) 2,158,895 1,001,600
| ---- ---- ---- | 367(4) 359 392
| 1,525,446 2,534,254 1,376,997
|
Melvin Wesley III Chief Financial Officer (hired August 29, 2014) | 2014 | 107,897 | 2,374,921(11) | 1,899,427(12) | 846(4) | 4,383,092 |
Cameron Meierhoefer Chief Operating Officer | 2014 2013 2012 | 342,333 315,750 293,749 | 2,491,271(13) 1,411,262 1,025,600 | 1,899,427(12) ---- ---- | 1,950(4) 1,929 1,207 | 4,734,981 1,728,941 1,320,556 |
Christiana Lin Executive Vice President, General Counsel and Chief Privacy Officer | 2014 | 322,833 | 2,476,271(14) | 1,899,427(12) | 2,073 (4) | 4,700,604 |
Kenneth J. Tarpey (former Chief Financial Officer, retired August 28, 2014) | 2014 2013 2012 | 247,784 363,125 341,249
| 282,484(15) 1,525,138 849,100
| ---- ---- ---- | 121,788(16) 2,175 3,785
| 652,056 1,890,438 1,194,134
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| (1) | Amounts reflected in this column represent the aggregate grant date fair value of stock and option awards computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation-Stock Compensation (FASBFASB ASC Topic 718).718. Assumptions used in the calculation of these amounts are described in Note 115 to the consolidated financial statements included in our Annual Report on Form10-K for the fiscal year ended December 31, 2019. As described below under “Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Amendments to Long-Term Incentive Plan Awards,” the amounts reported in this column for Mr. Wiener, Mr. Wilson and Ms. Hofstetter also include incremental fair value related to modifications of restricted stock unit awards in 2019. |
| (2) | Amounts reflected in this column represent the aggregate grant date fair value of stock option awards computed in accordance with FASB ASC Topic 718. Assumptions used in the calculation of these amounts are described in Note 5 to the consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2019. |
| (3) | Amounts for 2019 include (a) matching contributions by us to the named executive officers’ 401(k) plan accounts, (b) payment of life insurance and accidental death and dismemberment premiums on behalf of the named executive officers, (c) attorneys’ fees of $200,000 for Mr. Livek, $50,000 for Mr. Wiener, $31,257 for Mr. Wilson and $10,000 for Ms. Hofstetter in connection with employment or separation negotiations, (d) immaterial membership dues (less than $400) for Mr. Livek, (e) consulting fees of $50,000 for Mr. Fuller and $10,546 for Mr. Wilson, (f) a stipend of $14,000 for Mr. Fuller for temporary living expenses, (g) severance benefits of $525,000 for Mr. Wiener, $88,636 for Mr. Wilson, $555,950 for Ms. Hofstetter and $116,667 for Ms. Bachmann, and (h) COBRA benefits of $19,422 for Mr. Wiener, $9,146 for Mr. Wilson, $19,422 for Ms. Hofstetter and $14,566 for Ms. Bachmann. |
| (4) | Mr. Livek served as our President until May 30, 2018, as a special advisor from May 30, 2018 until November 4, 2019, and as our Chief Executive Officer starting November 4, 2019. |
| (5) | Amount reflects a cash bonus based on performance in 2019, prorated for Mr. Livek’s base salary adjustment in 2019. |
| (6) | Mr. Fuller served as a non-employee director until March 31, 2019, as our Interim Chief Executive Officer from March 31, 2019 until November 4, 2019, and as a consultant andnon-employee director from November 4, 2019 throughyear-end. |
| (7) | Amount includes $29,647 in director fees earned by Mr. Fuller in 2019 before and after his service as Interim Chief Executive Officer. |
| (8) | Mr. Wiener served as our Chief Executive Officer from May 30, 2018 until March 31, 2019. |
| (9) | Amount reflects (a) a cash bonus of $219,375 based on performance in 2019, and (b) a cash bonus of $500,000 contingent on continued employment through December 15, 2019. |
| (10) | Amount reflects a cash bonus based on performance in 2019. |
| (11) | Mr. Wilson served as our Chief Revenue Officer until December 31, 2018, as a consultant from January 1, 2019 until April 17, 2019, and as our Chief Commercial Officer starting April 17, 2019. |
| (12) | Amount reflects a cash bonus based on performance in 2019. |
| (13) | Ms. Hofstetter served as our President from October 4, 2018 until March 31, 2019. |
| (14) | Ms. Bachmann served as a non-executive employee until April 17, 2019, and as our Chief Operating Officer from April 17, 2019 until May 29, 2019. |
2019 Grants of Plan-Based Awards Table
The following table sets forth information about grants of plan-based awards to our named executive officers during 2019.
| (1) | This award is a time-based restricted stock unit award granted under our 2018 Equity and Incentive Compensation Plan (the “Plan”) that vests as to one-third on each of November 4, 2020, November 4, 2021 and November 4, 2022, subject to the named executive officer’s continued employment or service through such vesting dates. |
| (2) | This award is a performance-based restricted stock unit award granted under the Plan that includes multiple performance periods and becomes eligible to vest on the last day of each three-month period beginning on November 4, 2019 and ending on November 4, 2029, based on achievement of certain stock price hurdles occurring within the applicable performance period. This award has a threshold payout equal to 16.66% and a maximum payout equal to 100%, in each case as applied to the total number of shares denominated in the award. For purposes of this row, the number of shares denominated in this award is reflected in the “Maximum” column. |
| (3) | This award is a time-based stock option award granted under the Plan that vests as to one-third on each of November 7, 2020, November 7, 2021 and November 7, 2022, subject to the named executive officer’s continued employment or service through such vesting dates. This award expires on November 7, 2029. |
| (4) | This award reflects deferred stock units, which are fully vested rights to receive shares of our Common Stock at a future date, granted under the Plan. |
| (5) | This represents a modification of a time-based restricted unit award originally granted on June 5, 2018 under the Plan. As described below under “Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Amendments to Long-Term Incentive Plan Awards,” these time-based restricted stock units were amended on March 31, 2019, resulting in a share-based payment modification under FASB ASC Topic 718. The amount reported in this row for the grant date fair value of this award is the incremental fair value related to the modification. |
| (6) | This represents a modification of a time-based restricted unit award originally granted on September 7, 2018 (for Mr. Wiener) or October 4, 2018 (for Ms. Hofstetter) under the Plan. As described below under “Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Amendments to Long-Term Incentive Plan Awards,” these time-based restricted stock units were amended on March 31, 2019, resulting in a share-based payment modification under FASB ASC Topic 718. The amount reported in this row for the grant date fair value of this award is the incremental fair value related to the modification. |
| (7) | This represents a modification of a performance-based restricted stock unit award originally granted on September 7, 2018 (for Mr. Wiener) or October 4, 2018 (for Ms. Hofstetter) under the Plan that is eligible to become earned on March 1, 2021 based on achievement of certain revenue and adjusted EBITDA performance goals through the performance period ending December 31, 2020. This award has a threshold payout of 0%, a target payout of 100% and a maximum payout of 200%. This row reflects as “target” the number of shares denominated in the award and as “maximum,” the maximum performance-based restricted stock units that are eligible to become earned. As described below under “Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Amendments to Long-Term Incentive Plan Awards,” these performance-based restricted stock units were amended on March 31, 2019, resulting in a share-based payment modification under FASB ASC Topic 718. The amount reported in this row for the grant date fair value of this award is the incremental fair value related to the modification. |
| (8) | This award is a time-based restricted stock unit award granted under the Plan that vests as to one-third on each of May 30, 2019, March 1, 2020 and March 1, 2021, subject to the named executive officer’s continued employment or service through such vesting dates. |
| (9) | This award is performance-based restricted stock unit award granted under the Plan that includes multiple performance periods and becomes eligible to vest on each of the first ten anniversaries of March 1, 2019 and on May 22, 2029, based on achievement of certain stock price hurdles beginning on May 22, 2019 and ending on May 22, 2029. This award, as amended, has a threshold payout equal to 12.50% and a maximum payout equal to 100%, in each case applied to the number of shares denominated in the award. For purposes of this row, the number of shares denominated in this award is reflected in the “Maximum” column. As described below under “Narrative |
| Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Amendments to Long-Term Incentive Plan Awards,” these performance-based restricted stock units were amended on December 16, 2019, resulting in a share-based payment modification under FASB ASC Topic 718. The amount reported in this row for the grant date fair value of this award also includes $375,781, which is the incremental fair value related to the modification. |
| (10) | This award is a time-based stock option award granted under the Plan that vests as to one-fourth on each of May 22, 2020, May 22, 2021, May 22, 2022 and May 22, 2023, subject to the named executive officer’s continued employment or service through such vesting dates. This award expires on May 22, 2029. |
| (11) | This award is a sign-on restricted stock unit award granted under the Plan that would have vested as toone-third on each of March 1, 2020, March 1, 2021, and March 1, 2022, subject to the named executive officer’s continued employment or service through such vesting date. In connection with Ms. Bachmann’s resignation, this restricted stock unit award was forfeited. |
| (12) | The amounts shown in this column represent the grant date fair value of equity awards granted to our named executive officers in 2019 computed in accordance with FASB ASC 718, disregarding any potential forfeitures. Additionally, the amounts in this column represent the incremental fair value of the modification on (i) March 31, 2019 relating to each award reported for Bryan Wiener and Sarah Hofstetter and (ii) December 16, 2019 relating to the performance-based restricted stock unit award granted to Chris Wilson in May 2019. With respect to any performance-based restricted stock units included in this column, the amounts are also reflective of the “probable” outcome of vesting determined for accounting purposes. For additional information regarding the assumptions underlying these calculations, please see Note 5 to the consolidated financial statements included in Item 8 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2014. |
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(2) | Includes a promotion grant of 44,459 restricted stock units awarded on March 3, 2014, with 22,230 shares to be earned on achievement against 2014 company-level performance objectives, and 22,229 shares to vest in three equal installments in February 2015, 2016 and 2017. Includes a market-based restricted stock unit grant awarded in November 7, 2014, of 141,678 shares to vest upon the achievement of pre-established stock-price targets, using a valuation of $31.82 per share performed under guidance found in Accounting Standards Codification 718. This restricted stock unit grant would vest in four increments with 68,401 shares, 13,686 shares, 31,091 shares and 28,500 shares vesting if the average daily closing price of the Company's common stock on the NASDAQ Global Market during any consecutive thirty-day period exceeds $48.00, $50.00, $55.00, and $60.00, respectively; no vesting from this award occurred in 2014. Includes a performance-based annual target incentive with a fair value of $700,000 computed in accordance with FASB ASC Topic 718, to vest in February 2015 upon achievement of pre-determined 2014 revenue, and Adjusted EBITDA milestones. Includes a performance-based long-term target incentive with a fair value of $700,000 computed in accordance with FASB ASC Topic 718, to vest in February 2015 upon achievement of pre-determined 2014 revenue, and Adjusted EBITDA milestones. On February 11, 2015, because we surpassed our pre-established consolidated revenue and Adjusted EBITDA targets, an annual incentive of $1,278,775 was actually awarded. Also on February 11, 2015, because we surpassed our pre-established consolidated revenue and Adjusted EBITDA targets, a performance-based long-term incentive of $1,278,775 was awarded with vesting in three equal installments in February 2015, 2016, and 2017. |
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(3) | Includes a market-based stock option award of the option to purchase 984,727 shares of our common stock with an exercise price of $42.92 per share with a valuation of $8.68 per share using the Black-Scholes option-pricing formula and single option award approach. The fair value of market-based stock options is determined using a Monte Carlo simulation embedded in a lattice model. The Company then amortizes the fair value of awards expected to vest on a ratable straight-line basis over the requisite service periods of2019. For additional information regarding the awards which is generally the period from the grant date to the end of the vesting period. The stock option award would become exercisablereported in four increments with 646,400 shares, 96,651 shares, 141,558 shares and 100,118 shares exercisable if the average daily closing price of the Company's common stock on the NASDAQ Global Market during any consecutive thirty-day period exceeds $48.00, $50.00, $55.00, and $60.00, respectively; no vesting of this award occurred in 2014. |
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(4) | Includes discretionary matching contributions by us to the officer’s 401(k) plan account and payment of life insurance premiums on behalf of the named executive officers. |
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(5) | Includes $234,049 computed in accordance with FASB ASC Topic 718, received in restricted stock units in lieu of cash salary from January 1, 2014 through December 31, 2014 with the remainder paid in cash during 2014 to cover health benefits. |
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(6) | Represents a performance-based restricted stock unit award made pursuant to the provisions of our 2012 Chief Executive Officer Bonus Policy, to vest over three equal annual tranches, based on performance targets established in the beginning of each measurement year. At his request, upon transition to Executive Chairman, 96,666 shares of our common stock originally granted would remain in force subject to the achievement of performance objectives established in 2014. In 2014, performance criteria were approved by our Compensation Committee on February 28, 2014, with a fair value of $3,044,012, computed in accordance with FASB ASC Topic 718, to vest in February 2015 upon achievement of pre-determined revenue, EBITDA, and product related milestones in 2014. On February 11, 2015, because we surpassed our pre-established consolidated revenue and Adjusted EBITDA targets, 100% of these performance-based shares (or 96,666) vested, and an additional 19,982 performance-based restricted stock units vested with a total vest date fair value of $3,673,222 computed in accordance with FASB ASC Topic 718 for over-achievement of pre-established goals. |
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(7) | Represents a performance-based award related to our 2012 Equity Incentive Plan granted on March 29, 2012, in restricted stock pursuant to the provisions of our 2012 Chief Executive Officer Bonus Policy, to vest over three equal annual tranches, based on performance targets established in the beginning of each measurement year. In 2013, performance criteria were approved by our Compensation Committee on April 30, 2013, with a fair value of $1,563,089 computed in accordance with FASB ASC Topic 718, to vest on March 30, 2014 upon achievement of pre-determined revenue and Adjusted EBITDA milestones in 2013. On March 30, 2014, because we surpassed our pre-established consolidated revenue and Adjusted EBITDA targets, 100% of these performance-based shares (or 96,666) vested, and an additional 65,620 performance-based restricted stock units vested with a vest date fair value of $5,160,263 computed in accordance with FASB ASC Topic 718 for over-achievement of pre-established goals. The table, does not reflect the shares subject to 2014 performance, for which performance goals have not been established. For a description of this awardplease see the "Compensation Discussionsection above entitled “Executive Compensation Actions and Analysis- Additional ArrangementsDecisions for Chief Executive Officer.2019.” |
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(8) | Represents a performance-based award related to our 2012 Equity Incentive Plan granted on March 29, 2012, in restricted stock pursuant to the provisions of our 2012 Chief Executive Officer Bonus Policy, with a grant date fair value of $2,103,452 computed in accordance with FASB ASC Topic |
718,Narrative to vest on March 30, 2013 upon achievement of pre-determined revenue2019 Summary Compensation Table and Adjusted EBITDA milestones in 2012. On March 30, 2013, 100% of these performance-based shares were canceled due to failure to achieve pre-determined milestones during 2012. Also represents a grant to Dr. Abraham of 210,000 shares, awarded on March 29, 2012, made for retention purposes with vesting over a 4-year period in March 2013, 2014, 2015, and 2016 respectively.
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(9) | Includes $332,079 computed in accordance with FASB ASC Topic 718, received in restricted stock units in lieu of cash salary from January 1, 2014 through December 31, 2014 with the remainder paid in cash during 2014 to cover health benefits. |
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(10) | Includes a performance-based annual target incentive with a fair value of $375,000 computed in accordance with FASB ASC Topic 718, to vest in February 2015 upon achievement of pre-determined 2014 revenue and management based objectives. Includes a performance-based long-term target incentive with a fair value of $275,000 computed in accordance with FASB ASC Topic 718, to vest in February 2015 upon achievement of pre-determined 2014 Adjusted EBITDA milestones. On February 11, 2015, because we surpassed our pre-established consolidated revenue target, an annual incentive of $571,093 was actually awarded. Also on February 11, 2015, because we surpassed our pre-established Adjusted EBITDA target, a performance-based long-term incentive of $500,000 was awarded with vesting in three equal installments in February 2015, 2016, and 2017. |
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(11) | Includes a new hire grant of 10,000 shares of our common stock awarded on August 29, 2014, with vesting in three equal installments in August 2015, 2016 and 2017. Includes a market-based restricted stock unit grant awarded in November 7, 2014, of 31,484 shares to vest upon the achievement of pre-established stock-price targets, using a valuation of $31.82 per share performed under guidance found in Accounting Standards Codification 718. This restricted stock unit grant is earned in four increments with 15,112 shares, 3,148 shares, 6,926 shares and 6,297 shares vesting if the average daily closing price of the Company's common stock on the NASDAQ Global Market during any consecutive thirty-day period exceeds $48.00, $50.00, $55.00, and $50.00, respectively; no vesting from this award occurred in 2014. Includes a performance-based annual target incentive with a fair value of $240,000 computed in accordance with FASB ASC Topic 718, to vest in February 2015 upon achievement of pre-determined 2014 revenue and Adjusted EBITDA milestones, as well as management based objectives. Includes a performance-based long-term target incentive with a fair value of $450,000 computed in accordance with FASB ASC Topic 718, to vest in February 2015 upon achievement of pre-determined Adjusted EBITDA milestones. On February 11, 2015, because we surpassed our pre-established consolidated revenue and Adjusted EBITDA targets, an annual incentive of $383,128 was actually awarded. Also on February 11, 2015, because we surpassed our pre-established Adjusted EBITDA target, a performance-based long-term incentive of $900,000 was awarded with vesting in three equal installments in February 2015, 2016, and 2017. |
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(12) | Includes a market-based stock option award of the option to purchase 218,828 shares of our common stock with an exercise price of $42.92 per share with a valuation of $8.68 per share using the Black-Scholes option-pricing formula and single option award approach. The fair value of market-based stock options is determined using a Monte Carlo simulation embedded in a lattice model. The Company then amortizes the fair value of awards expected to vest on a ratable straight-line basis over the requisite service periods of the awards, which is generally the period from the grant date to the end of the vesting period. The stock option award would become exercisable in four increments with 144,426 shares, 21,883 shares, 30,636 shares and 21,883 shares exercisable if the average daily closing price of the Company's common stock on the NASDAQ Global Market during any consecutive thirty-day period exceeds $48.00, $50.00, $55.00, and $60.00, respectively; no vesting of this award occurred in 2014. |
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(13) | Includes a one- time grant of 15,000 shares of our common stock awarded on May 1, 2014, with 7,500 shares to be earned on achievement against 2014 company-level performance objectives, and 7,500 shares to vest in three equal installments in February 2015, 2016 and 2017. Includes a market-based restricted stock unit grant awarded in November 7, 2014, of 31,484 shares to vest upon the achievement of pre-established stock-price targets, using a valuation of $31.82 per share performed under guidance found in Accounting Standards Codification 718. This restricted stock unit grant is earned in four increments with 15,112 shares, 3,148 shares, 6,926 shares and 6,297 shares vesting if the average daily closing price of the Company's common stock on the NASDAQ Global Market during any consecutive thirty-day period exceeds $48.00, $50.00, $55.00, and $50.00, respectively; no vesting from this award occurred in 2014. Includes a performance-based annual target incentive with a fair value of $265,000 computed in accordance with FASB ASC Topic 718, to vest in February 2015 upon achievement of pre-determined 2014 revenue milestones and management based objectives. Includes a performance-based long-term target incentive with a fair value of $450,000 computed in accordance with FASB ASC Topic 718, to vest in February 2015 upon achievement of pre-determined Adjusted EBITDA milestones. On February 11, 2015, because we surpassed our pre-established consolidated revenue, an annual incentive of $340,951 was actually awarded. Also on February 11, 2015, because we surpassed our pre-established Adjusted EBITDA target, a performance-based long-term incentive of $900,000 was awarded with vesting in three equal installments in February 2015, 2016, and 2017. |
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(14) | Includes a one- time grant of 15,000 shares of our common stock awarded on May 1, 2014, with 7,500 shares to be earned on achievement against 2014 company-level performance objectives, and 7,500 shares to vest in three equal installments in February 2015, 2016 and 2017. Includes a market-based restricted stock unit grant awarded in November 7, 2014, of 31,484 shares to vest upon the achievement of pre-established stock-price targets, using a valuation of $31.82 per share performed under guidance found in Accounting Standards Codification 718. This restricted stock unit grant is earned in four increments with 15,112 shares, 3,148 shares, 6,926 shares and 6,297 shares vesting if the average daily closing price of the Company's common stock on the NASDAQ Global Market during any consecutive thirty-day period exceeds $48.00, $50.00, $55.00, and $50.00, respectively; no vesting from this award occurred in 2014. Includes a performance-based annual target incentive with a fair value of $250,000 computed in accordance with FASB ASC Topic 718, to vest in February 2015 upon achievement of pre-determined management based objectives. Includes a performance-based long-term target incentive with a fair value of $450,000 computed in accordance with FASB ASC Topic 718, to vest in February 2015 upon achievement of pre-determined Adjusted EBITDA milestones. On February 11, 2015, an annual incentive of $249,750 was actually awarded. Also on February 11, 2015, because we surpassed our pre-established Adjusted EBITDA target, a performance-based long-term incentive of $900,000 was awarded with vesting in three equal installments in February 2015, 2016, and 2017. |
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(15) | Includes $243,174 computed in accordance with FASB ASC Topic 718 received in restricted stock units vesting immediately upon retirement pursuant to the terms of the Mr. Tarpey's Transition Agreement. Also includes a grant with a fair value of $39,310 representing shares awarded post-departure in connection with Mr. Tarpey's appointment to the Company's advisory board. |
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(16) | Includes severance payment of $119,716 pursuant to the terms of the Mr. Tarpey's Transition Agreement. |
2019 Grants of Plan-Based Awards Table
Our stockholders approved our equity incentive plan on May 30, 2018. Prior to this date, we were unable to grant equity awards to our named executive officers in 2016, 2017 or 2018. As a result, awards granted to the named executive officers in 2018 represent both equity compensation opportunities lost in prior periods and normalized long-term incentive awards for 2018. For details about equity incentive awards granted to our named executive officers in 2019, see “Executive Compensation Actions and Decisions for 2019.”
Amendments to Long-Term Incentive Plan Awards
In connection with Mr. Wiener’s and Ms. Hofstetter’s resignations, the Compensation Committee amended the terms of certain outstanding restricted stock unit and performance-based restricted stock unit awards originally granted in 2018, effective as of March 31, 2019, the effective date of their resignations. On December 16, 2019, the Compensation Committee also amended the terms of the performance-based restricted stock award originally granted to Chris Wilson in May 2019. As a result of these amendments, we revalued these awards as of the applicable amendment dates under FASB ASC Topic 718. The incremental value of these modifications is reflected above in the Summary Compensation Table and the Grants of Plan-Based Awards Table.
Dividend Equivalent Rights
The restricted stock unit awards, performance-based restricted stock unit awards, and deferred stock unit awards granted to our named executive officers in 2018 and 2019 include tandem dividend equivalent rights. These rights provide our named executive officers with the opportunity to be credited with an additional amount of cash that is equal to the amount ofper-share
cash dividends, if any, that are paid to our stockholders between the date of grant and the date of settlement (or forfeiture) of the particular award. These credited dividend equivalent amounts are subject to the same terms and conditions (including vesting, payment, and forfeitability) that apply to the underlying shares subject to the award. We did not pay any cash dividends in 2018 or 2019. Other material terms of the equity awards granted to our named executive officers in 2019 are described in more detail in the notes to the Grants of Plan-Based Awards Table and under “Compensation Discussion and Analysis – Executive Compensation Actions and Decisions for 2019”above. The ratio of Mr. Livek’s base salary and bonus in proportion to his total compensation earned for 2019 was 32%, and the average ratio of the salary and bonuses earned by the other named executive officers to their total compensation earned for 2019 was 43%.
These ratios are expected to change in future years that do not involve the same level of transition in our executive team. Please see the Compensation Discussion and Analysis section of this filing for a description of the objectives of our compensation program and our overall compensation philosophy.
2019 Outstanding Equity Awards at Fiscal Year End
The following table sets forth certain information concerning grants of plan-based awards to our named executive officers in 2014.
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| | | | | | | | | | | | | | | |
| | | Approval Date | Estimated Future Payouts Under Equity Incentive Plan Awards (1) | All Other Stock Awards: Number of Shares of Stock (#) |
| All Other Option Awards: Number of Securities Underlying Options (#) |
| Exercise or Base Price of Option Awards ($/Sh) | Grant Date Fair Value of Stock and Option Awards($) (2) |
|
| Name | Grant Date | Target ($) | Maximum($) | Target (#) |
| Maximum (#) |
|
| Serge Matta | 3/3/2014 | 2/28/2014 | — | — | — | — | 22,229(3) |
| — | — | $699,991 |
| | 3/3/2014 | 2/28/2014 | — | — | 22,230(4) |
| — | — | — | — | 700,023 |
|
| | 11/7/2014 | 11/7/2014 | — | — | 141,678 | (5) | — | — | — | — | 4,508,194 |
|
| | 11/7/2014 | 11/7/2014 | — | — | — | — | — | 984,727 | (6) | $42.92 | 8,547,430 |
|
| | (7) | (7) | $700,000 | $1,400,000 | — | — | — | — | — | 700,000(8) |
|
| | (7) | (7) | $700,000 | $1,400,000 | — | — | — | — | — | 700,000(9) |
|
| | (7) | (7) | $700,000 | — | — | — | — | — | — | 700,000(10) |
|
| Magid M. Abraham, Ph.D | 3/3/2014(11) | 2/28/2014 | — | — | 96,666 | (12) | 144,999 | (12) | — | — | — | 3,044,012 |
|
| | 3/31/2014 | 2/28/14 | — | — | — | — | 1,785 | (13) | — | — | 58,530 |
|
| | 6/30/2014 | 2/28/14 | — | — | — | — | 1,649 | (13) | — | — | 58,507 |
|
| | 9/30/2014 | 2/28/14 | — | — | — | — | 1,607 | (13) | — | — | 58,511 |
|
| | 12/31/2014 | 2/28/14 | — | — | — | — | 1,260 | (13) | — | — | 58,502 |
|
| Gian M. Fulgoni | 3/31/2014 | 2/28/14 | — | — | — | — | 2,532 | (13) | — | — | 83,024 |
|
| | 6/30/2014 | 2/28/14 | — | — | — | — | 2,340 | (13) | — | — | 83,023 |
|
| | 9/30/2014 | 2/28/14 | — | — | — | — | 2,280 | (13) | — | — | 83,015 |
|
| | 12/31/2014 | 2/28/14 | — | — | — | — | 1,788 | (13) | — | — | 83,017 |
|
| | (7) | (7) | $375,000 | $750,000 | — | — | — | — | — | 375,000(14) |
|
| | (7) | (7) | $275,000 | $500,000 | — | — | — | — | — | 275,000(15) |
|
| | (7) | (7) | $500,000 | — | — | — | — | — | — | 500,000(10) |
|
| Melvin Wesley III | 8/29/2014 | 8/1/2014 | — | — | — | — | 10,000(16) |
| — | — | 383,100 |
|
| | 11/7/2014 | 11/7/2014 | — | — | 31,484 | (17) | — | — | — | — | 1,001,821 |
| | 11/7/2014 | 11/7/2014 | — | — | — | — | — | 218,828 | (18) | $42.92 | 1,899,427 |
|
| | (7) | (7) | $240,000 | $480,000 | — | — | — | — | — | 240,000(19) |
|
| | (7) | (7) | $450,000 | $900,000 | — | — | — | — | — | 450,000(15) |
|
| | (7) | (7) | $300,000 | — | — | — | — | — | — | 300,000(10) |
|
| Cameron Meierhoefer | 5/1/2014 | 4/15/2014 | — | — | — | — | 7,500(3) |
| — | — | 237,225 |
|
| | 5/1/2014 | 4/15/2014 | — | — | 7,500(4) |
| — | — | — | — | 237,225 |
|
| | 11/7/2014 | 11/7/2014 | — | — | 31,484 | (17) | — | — | — | — | 1,001,821 |
| | 11/7/2014 | 11/7/2014 | — | — | — | — | — | 218,828 | (18) | $42.92 | 1,899,427 |
|
| | (7) | (7) | $265,000 | $530,000 | — | — | — | — | — | 265,000(14) |
|
| | (7) | (7) | $450,000 | $900,000 | — | — | — | — | — | 450,000(15) |
|
| | (7) | (7) | $300,000 | — | — | — | — | — | — | 300,000(10) |
|
| Christiana Lin | 5/1/2014 | 4/15/2014 | — | — | — | — | 7,500(3) |
| — | — | 237,225 |
|
| | 5/1/2014 | 4/15/2014 | — | — | 7,500(4) |
| — | — | — | — | 237,225 |
|
| | 11/7/2014 | 11/7/2014 | — | — | 31,484 | (17) | — | — | — | — | 1,001,821 |
| | 11/7/2014 | 11/7/2014 | — | — | — | — | — | 218,828 | (18) | $42.92 | 1,899,427 |
|
| | (7) | (7) | $250,000 | $500,000 | — | — | — | — | — | 250,000(14) |
|
|
| | | | | | | | | | | | | | | |
| | | Approval Date | Estimated Future Payouts Under Equity Incentive Plan Awards (1) | All Other Stock Awards: Number of Shares of Stock (#) |
| All Other Option Awards: Number of Securities Underlying Options (#) |
| Exercise or Base Price of Option Awards ($/Sh) | Grant Date Fair Value of Stock and Option Awards($) (2) |
|
| Name | Grant Date | Target ($) | Maximum($) | Target (#) |
| Maximum (#) |
|
| | (7) | (7) | $450,000 | $900,000 | — | — | — | — | — | 450,000(15) |
|
| | (7) | (7) | $300,000 | — | — | — | — | — | — | 300,000(10) |
|
Kenneth J. Tarpey (retired August 29, 2014) | 8/15/2014 | 7/22/2014 | — | — | — | — | 6,205 | (20) | — | — | 243,174 |
|
| | 9/2/2014 | 9/2/2014 | — | — | — | — | 1,000 | (21) | — | — | |
| |
(1) | The target and maximum incentive award amounts shown in this column reflect the value of the short- and long-term incentive compensation available to our named executive officers pursuant to our 2014 executive incentive compensation policy. The amounts representing the target awards were pre-established as a percentage of salary. The maximum is the greatest payout which can be made if the pre-established maximum performance level is met or exceeded. The policy also provides that the entire award amount shall be paid in shares of restricted stock valued at the time of grant. Actual awards under our 2014 executive incentive compensation policy were approved on February 11, 2015 and are reflected in the Stock Award column of the Summary Compensation Table above for 2014 in each case for each named executive officer. |
| |
(2) | Amounts represent fair value of awards as calculated in accordance with FASB ASC Topic 718 and as further described in Note 11 to the consolidated financial statements included in Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2014. |
| |
(3) | One-time restricted stock unit award to vest in three equal installments in February 2015, 2016 and 2017. |
| |
(4) | One-time restricted stock unit award to be earned based on achievement against 2014 company-level performance objectives, with achievement amounts determined in February 2015. |
| |
(5) | Market-based restricted stock unit grant awarded in November 7, 2014, to be earned on achievement of pre-established stock-price targets, using a valuation of $31.82 per share performed under guidance found in Accounting Standards Codification 718. This restricted stock unit grant will be earned in four increments with 68,401 shares, 13,686 shares, 31,091 shares and 28,500 shares, respectively, if the average daily closing price of the Company's common stock on the NASDAQ Global Market during any consecutive thirty-day period exceeds $48.00, $50.00, $55.00, and $60.00, respectively; no shares were earned under this award in 2014. |
| |
(6) | Market-based stock option award of the option to purchase 984,727 shares of our common stock with an exercise price of $42.92 per share with a valuation of $8.68 per share using the Black-Scholes option-pricing formula and single option award approach. The fair value of market-based stock options is determined using a Monte Carlo simulation embedded in a lattice model. The Company then amortizes the fair value of awards expected to vest on a ratable straight-line basis over the requisite service periods of the awards, which is generally the period from the grant date to the end of the vesting period. The stock option award would become exercisable in four increments with 646,400 shares, 96,651 shares, 141,558 shares and 100,118 shares exercisable if the average daily closing price of the Company's common stock on the NASDAQ Global Market during any consecutive thirty-day period exceeds $48.00, $50.00, $55.00, and $60.00, respectively; no vesting of this award occurred in 2014. |
| |
(7) | On February 28, 2014, our Compensation Committee established our 2014 Executive Compensation Bonus Policy to include target annual incentives, target long-term performance-based incentives, and long-term time-based incentives. These incentives would be awarded in February 2015, after our Compensation Committee determined actual achievement against targets (for the performance-based incentive components), and subject to the named executive officer's continued service on the determination date. |
| |
(8) | Annual incentive award levels pursuant to 2014 Executive Compensation Bonus Policy. 50% of the award amount was based on achievement of pre-determined 2014 revenue target levels and 50% of the award amount was based on achievement against 2014 adjusted EBITDA target levels as discussed in Incentive Compensation. Actual achievement against 2014 revenue targets was 165%, and actual achievement against 2014 Adjusted EBITDA targets was 200%. The determination date for these achievement amounts was February 11, 2015, and 100% of the award was immediately vested.
|
| |
(9) | Long-term performance-based award levels pursuant to 2014 Executive Compensation Bonus Policy. 50% of the award amount was based on achievement against 2014 revenue target levels and 50% of the award amount was based on achievement against 2014 Adjusted EBITDA target levels as discussed in Incentive Compensation. Actual achievement against 2014 revenue targets was 165%, and actual achievement against 2014 Adjusted EBITDA targets was 200%. The determination date for these achievement amounts was February 11, 2015, and 1/3 of the award amount was immediately vested in February 2015 with 1/3 vesting in each of February 2016 and February 2017.
|
| |
(10) | As part of the 2014 Executive Compensation Bonus Policy, our Compensation Committee would grant the named executive officer a time-based long-term incentive award in an amount equal to the amount with a value set forth in the “Target” column. The determination date for these awards was February 11, 2015, and 1/3 of the award amount was immediately vested in February 2015 with 1/3 vesting in each of February 2016 and February 2017. |
| |
(11) | Based on our 2012 Chief Executive Officer Bonus Policy, restricted stock and restricted stock units were awarded to Dr. Abraham, to vest over three equal annual tranches, based on performance targets established in the beginning of each measurement year. The “Grant Date” represents the date on which the Dr. Abraham’s 2014 performance criteria were approved by our Compensation Committee. |
| |
(12) | Performance-based restricted stock unit award made pursuant to the provisions of our 2012 Chief Executive Officer Bonus Policy, to vest over three equal annual tranches, based on performance targets established in the beginning of each measurement year. At his request, upon transition to Executive Chairman, 96,666 shares of our common stock originally granted would remain in force subject to the achievement of performance objectives established in 2014, and 50% of the 96,666 share of our common stock originally granted for the purpose of recognizing overachievement against performance objectives would remain in force. In 2014, performance criteria were approved by our Compensation Committee on February 28, 2014, with a fair value of $3,044,012, computed in accordance with FASB ASC Topic 718, to vest in February 2015 upon achievement of pre-determined revenue, EBITDA, and product related milestones in 2014. On February 11, 2015, because we surpassed our pre-established consolidated revenue and Adjusted EBITDA targets, 100% of these performance-based shares (or 96,666) vested, and an additional 19,982 performance-based restricted stock units vested with a vest date fair value of $3,673,222 computed in accordance with FASB ASC Topic 718 for over-achievement of pre-established goals. |
| |
(13) | Restricted stock units awarded in lieu of cash salary. |
| |
(14) | Annual incentive award levels pursuant to 2014 Executive Compensation Bonus Policy. Award amount was based on achievement against 2014 revenue target levels and individual performance objectives as discussed in Incentive Compensation. The actual achievement against 2014 revenue target was 165%.
|
| |
(15) | Long-term performance-based award levels pursuant to 2014 Executive Compensation Bonus Policy. Award amount was based on achievement against 2014 Adjusted EBITDA target levels as discussed in Incentive Compensation. Actual achievement against 2014 Adjusted EBITDA targets was 200%. 1/3 of the award amount was immediately vested in February 2015 with 1/3 vesting in each of February 2016 and February 2017.
|
| |
(16) | Represents a new hire grant of 10,000 shares of our common stock awarded on August 29, 2014, with vesting in three equal installments in August 2015, 2016 and 2017. |
| |
(17) | Market-based restricted stock unit grant awarded in November 7, 2014, of 31,484 shares to vest upon the achievement of pre-established stock-price targets, using a valuation of $31.82 per share performed under guidance found in Accounting Standards Codification 718. This restricted stock unit grant would vest in four increments with 15,112 shares, 3,148 shares, 6,926 shares and 6,297 68,401 shares, 13,686 shares, 31,091 shares and 28,500 shares vesting if the average daily closing price of the Company's common stock on the NASDAQ Global Market during any consecutive thirty-day period exceeds $48.00, $50.00, $55.00, and $60.00, respectively; no shares were earned from this award in 2014. |
| |
(18) | Market-based stock option award of the option to purchase 218,828 shares of our common stock with an exercise price of $42.92 per share with a valuation of $8.68 per share using the Black-Scholes option-pricing formula and single option award approach. The fair value of market-based stock options is determined using a Monte Carlo simulation embedded in a lattice model. The Company then amortizes the fair value of awards expected to vest on a ratable straight-line basis over the requisite service periods of the awards, which is generally the period from the grant date to the end of the vesting period. The stock option award would become exercisable in four increments with 144,426 shares, 21,883 shares, 30,636 shares and 21,883 shares exercisable if the average daily closing price of the Company's common stock on the NASDAQ Global Market during any consecutive thirty-day period exceeds $48.00, $50.00, $55.00, and $60.00, respectively; no vesting of this award occurred in 2014. |
| |
(19) | Annual incentive award levels pursuant to 2014 Executive Compensation Bonus Policy. Award amount was based on achievement against 2014 revenue and adjusted EBITDA target levels and management based objectives as discussed in Incentive Compensation. The actual achievement against 2014 revenue target and Adjusted EBITDA were 165% and 200% respectively.
|
| |
(20) | On May 8, 2014, the Company announced Mr. Tarpey's intention to retire and the entry into a Transition Agreement with Mr. Tarpey dated May 5, 2014 (the "Transition Agreement"). Under the terms of the Transition Agreement, Mr. Tarpey received a one-time distribution of shares based on a pro-rated calculation of his 2014 short-term incentive and the immediately vested performance-based portion of his 2014 long-term incentive pursuant to the Company's 2014 executive incentive plan. The incentive achievement amounts were determined based on the Company's first and second quarter revenue and Adjusted EBITDA results relative to the targets, with the assumption that Mr. Tarpey achieved 100% of of any management based objectives for those periods. No overachievement was assumed or allocated. |
| |
(21) | One-time award to vest on the one year anniversary of grant date, for the purpose of providing transition services after Mr. Tarpey's departure. |
Outstanding Equity Awards at Fiscal Year End
The following table shows outstanding equity awards held by the named executive officers as of December 31, 2014.2019.
|
| | | | | | | |
| | Option Awards | Stock Awards |
| | Equity Incentive Plan Awards (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares of Stock That Have Not Vested (#)(1) | Market Value of Shares of Stock That Have Not Vested ($)(1) | Equity Incentive Plan Awards |
| Name | Unexercised and Unearned | Unearned Shares That Have Not Vested (#) | Market Value of Unearned Shares That Have Not Vested ($) |
| Serge Matta | — | — | — | 7,500(2) | 348,225 | — | — |
| | — | — | — | 2,268(3) | 105,303 | — | — |
| | — | — | — | 17,500(4) | 812,526 | — | — |
| | — | — | — | 4,858(5) | 225,557 | — | — |
| | — | — | — | 33,334(6) | 1,547,698 | — | — |
| | — | — | — | 25,110(7) | 1,165,858 | — | — |
| | — | — | — | 22,229(8) | 1,032,092 | — | — |
| | — | — | — | 22,230(9) | 1,032,139 | — | — |
| | — | — | — | — | — | 141,678(10) | $6,578,110 |
| | 984,727(11) | $42.92 | 11/4/2017 | — | — | — | — |
| | | | | | | | |
| Magid M. Abraham, Ph.D. | — | — | — | 9,981(12) | 463,418 | — | — |
| | — | — | — | 70,000(13) | 3,250,100 | — | — |
| | — | — | — | 145,000(14) | 6,732,350 | — | — |
| | | | | | | | |
| Gian M. Fulgoni | — | — | — | 17,500(15) | 812,525 | — | — |
| | — | — | — | 6,695(16) | 310,849 | — | — |
| | — | — | — | 16,667(17) | 773,849 | — | — |
| | — | — | — | 6,695(18) | 310,849 | — | — |
| | | | | | | | |
| Melvin Wesley III | — | — | — | 10,000(19) | 464,300 | — | — |
| | — | — | — | — | — | 31,484(20) | $2,221,954 |
| | 218,828(21) | $42.92 | 11/4/2017 | — | — | — | — |
| | | | | | | | |
| Cameron Meierhoefer | — | — | — | 1,542(22) | 71,595 | — | — |
| | — | — | — | 17,500(23) | 812,525 | — | — |
| | — | — | — | 3,807(24) | 176,759 | — | — |
| | — | — | — | 16,667(25) | 773,849 | — | — |
| | — | — | — | 12,555(26) | 582,929 | — | — |
| | — | — | — | 15,000(27) | 696,450 | — | — |
| | — | — | — | — | — | 31,484(20) | $2,221,954 |
|
| | | | | | | |
| | Option Awards | Stock Awards |
| | Equity Incentive Plan Awards (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares of Stock That Have Not Vested (#)(1) | Market Value of Shares of Stock That Have Not Vested ($)(1) | Equity Incentive Plan Awards |
| Name | Unexercised and Unearned | Unearned Shares That Have Not Vested (#) | Market Value of Unearned Shares That Have Not Vested ($) |
| | 218,828(21) | $42.92 | 11/4/2017 | — | — | — | — |
| | | | | | | | |
| Christiana Lin | — | — | — | 1,652(28) | 76,702 | — | — |
| | — | — | — | 12,500(29) | 580,376 | — | — |
| | — | — | — | 3,628(30) | 168,448 | — | — |
| | — | — | — | 16,667(31) | 773,849 | — | — |
| | — | — | — | 12,555(32) | 582,929 | — | — |
| | — | — | — | 15,000(33) | 696,450 | — | — |
| | — | — | — | — | — | 31,484(20) | $2,221,954 |
| | 218,828(21) | $42.92 | 11/4/2017 | — | — | — | — |
| | | | | | | | |
Kenneth J. Tarpey (retired August 28, 2014) | — | — | — | 1,000(34) | — | — | 39,310 |
| |
| (1) | The awards reported in this column reflect time-based restricted stock unit awards, which vest as set forth in the following table, subject to the named executive officer’s continued employment or service through such vesting dates: |
| | | | | | |
| | | | | Remaining Vesting Schedule |
| | | | | | One-third on each of November 4, 2020, November 4, 2021 and November 4, 2022 |
| | | | | | One-half on each of November 15, 2020 and November 15, 2021 |
| | | | | | One-half on each of May 15, 2020 and May 15, 2021 |
| | | | | | One-half on each of March 1, 2020 and March 1, 2021 |
| | | | | | One-half on each of January 30, 2020 and January 30, 2021 |
| | | | | | |
| | | | | | |
| | | | | | One-half on each of March 1, 2020 and March 1, 2021 |
| | | | | | 100% on February 15, 2020 One-half on each of March 1, 2020 and March 1, 2021 |
| | | | | | One-half on each of August 15, 2020 and August 15, 2021 |
| (a) | The performance-based restricted stock unit award granted to Ms. DiBattiste in 2018 which included a performance period that ended on December 31, 2019 became vested as to performance with respect to 1,638 shares. These shares remained subject to continued time-based vesting requirements through March 1, 2020 and are accordingly reported as outstanding time-based awards for purposes of this table. The remaining shares subject to the original performance-based restricted stock unit award were forfeited. |
| (2) | Amounts in these columns reflect the market value of shares or units of stock reported in the preceding column that have not vested, is computed based on $46.43 per share, which was the closing price of our common stockCommon Stock as reported on the NASDAQNasdaq Global Select Market on December 31, 2014. For a description of this award see the Compensation Discussion and Analysis section titled Annual Incentive Compensation for Dr. Abraham.2019, which was $4.94 per share. |
| |
(2) | comScore’s right of repurchase lapses for 7,500 shares annually on February 18, contingent upon Mr. Matta's continued service as of each such date. |
| |
| (3) | comScore’s rightThe awards reported in this column reflect (i) for awards granted during 2018, the target number of repurchase lapses for 2,268 shares annually on March 15, contingent upon Mr. Matta's continued service as of each such date. |
| |
(4) | comScore’s right of repurchase lapses for 8,750 shares annually on March 15, contingent upon Mr. Matta's continued service as of each such date. |
| |
(5) | Restricted stock unit award with 4,858 shares vesting annually on March 15, contingent upon Mr. Matta's continued service as of each such date. |
| |
(6) | Restricted stock unit award with 16,667 shares vesting annually on February 18, contingent upon Mr. Matta's continued service as of each such date. |
| |
(7) | Restricted stock unit award with 12,555 shares vesting annually on February 18, contingent upon Mr. Matta's continued service as of each such date. |
| |
(8) | Restricted stock unit award with 7,335, 7,336 and 7,558 shares vesting annually beginning February 18, 2015, contingent upon Mr. Matta's continued service as of each such date. |
| |
(9) | Restricted stock unit award with 7,335, 7,336 and 7,559 shares vesting annually beginning February 18, 2015, contingent upon Mr. Matta's continued service as of each such date. |
| |
(10) | Restricted stock unit award subject to market based vesting. Award earned in four increments with 68,401 shares, 13,686 shares, 31,091 shares and 28,500 shares vesting if the average daily closing price of the Company's common stock on the NASDAQ Global Market during any consecutive thirty-day period exceeds $48.00, $50.00, $55.00, and $50.00, respectively. The award vested with respect to 68,401 shares on March 1, 2015 and 13,686 shares on March 8, 2015. |
| |
(11) | Stock options award subject to market based vesting. Award earned in four increments with 646,400 shares, 96,651 shares, 141,558 shares and 100,118 shares exercisable if the average daily closing price of the Company's common stock on the NASDAQ Global Market during any consecutive thirty-day period exceeds $48.00, $50.00, $55.00, and $50.00, respectively. The award became exercisable with respect to 646,400 shares on March 1, 2015 and 96,651 shares on March 8, 2015. |
| |
(12) | comScore’s right of repurchase lapses for 9,981 shares annually on March 15, contingent upon Dr. Abraham’s continued service as of each such date. |
| |
(13) | comScore’s right of repurchase lapses for 70,000 shares annually on March 30, contingent upon Dr. Abraham’s continued service as of each such date. |
| |
(14) | On March 29, 2012, Dr. Abraham was awarded 580,000 shares of our common stock in the form of restricted stock andperformance-based restricted stock units that vestwhich become eligible to be earned based on achievement of revenue andAdjusted EBITDAA goals during 2012, 2013 and 2014. In 2014, Dr. Abraham becomes eligible to earn up to 96,666 shares for achieving 100% of pre-establishedcertain revenue and Adjustedadjusted EBITDA targets. In 2014, this award was adjustedperformance goals subject to reflect Dr. Abraham's change in role to Executive Chairman. As a result, in 2014, Dr. Abraham is eligible to earn up to 96,666 sharesthe named executive officer’s continued employment or service through the end of the applicable performance period and (ii) for achieving 100%awards granted during 2019, the threshold number of pre-established revenue, Adjusted EBITDA, and product-specific goals, and an additional 48,333 shares for overachieving against pre-established revenue, Adjusted EBITDA, and product development targets. Any unearned shares from prior years have been canceled. |
| |
(15) | comScore’s right of repurchase lapses for 8,333 shares on March 15, 2015 and 8,334 shares on March 15, 2016, contingent upon Mr. Fulgoni’s continued service as of each such date. |
| |
(16) | comScore’s right of repurchase lapses for 6,695 shares on March 15, 2015 contingent upon Mr. Fulgoni's continued service on such date. |
| |
(17) | Restrictedperformance-based restricted stock unit awards with 8,333 shares vestingwhich become eligible to be earned based on February 18, 2015achievement of certain stock price hurdles subject to the named executive officer’s continued employment or service through the date of achievement of the applicable stock price hurdle during the applicable performance period. The awards described in clause (i) are reported at target because the performance metrics, while established by assuming certain multiyear growth rates over a three-year period, are measured by reference to final-year (2020) annual performance, for which achievement through December 31, 2019 was not applicable, and 8,334 shares vesting on February 18, 2016, contingent upon Mr. Fulgoni’s continued servicebecause there is no threshold value under these awards. The awards described in clause (ii) are reported at threshold because the threshold level of performance had not been achieved as of each such dates. |
| |
(18) | Restricted stock unit awards with 3,461 shares vesting on March 15, 2015, contingent upon Mr. Fulgoni's continued service on such date. |
| |
(19) | Restricted stock unit awards with 3,300 shares vesting on each of August 15, 2015 and August 15, 2016 and 3,400 shares vesting August 15, 2017, contingent upon Mr. Wesley's continued service as of each such date. |
| |
(20) | Restricted stock unit award subject to market based vesting. Award earned in four increments with 15,112 shares, 3,148 shares, 6,926 shares and 6,297 shares vesting ifDecember 31, 2019. The following table sets forth the average daily closing priceend of the Company's common stock on the NASDAQ Global Market during any consecutive thirty-dayapplicable performance period exceeds $48.00, $50.00, $55.00, and $50.00, respectively. Thefor each award vested with respect to 15,112 shares on March 1, 2015 and 3,148 shares on March 8, 2015.the number of performance-based restricted stock units reflected in this column: |
| | | | | | |
(21) | Stock options award subject to market based vesting. Award earned | | | | Performance Period End Date |
| | | | | | |
| | | | | | |
| | | | | | |
| | | | | | |
| | | | | | |
| | | | | | |
| (a) | As described below under “Payments Upon Termination or Change in four incrementsControl—Wiener Separation Agreement,” in connection with 144,426 shares, 21,883 shares, 30,636 shares and 21,883 shares exercisable ifMr. Wiener’s resignation, the average daily closing price of the Company's common stock on the NASDAQ Global Market during any consecutive thirty-day period exceeds $48.00, $50.00, $55.00, and $50.00, respectively. The award became exercisableservice requirement with respect to 144,426 shares on March 1, 2015 and 21,883 shares on March 8, 2015. |
| |
(22) | comScore’s right of repurchase lapses for 1,542 shares on March 15, 2015, contingent upon Mr. Meierhoefer's continued service on such date. |
| |
(23) | comScore’s right of repurchase lapses for 8,750 shares annually on March 15, contingent upon Mr. Meierhoefer's continued service as of each such date. |
| |
(24) | Restricted stock unit awards with 3,807 shares vesting on March 15, 2015, contingent upon Mr. Meierhoefer's continued service on such date. |
| |
(25) | Restricted stock unit awards with 8,333 shares vesting on February 18, 2015 and 8,334 shares vesting on February 18, 2016, contingent upon Mr. Meierhoefer's continued service as of each such date. |
| |
(26) | Restricted stock unit awards with 6,277 shares vesting on February 18, 2015 and 6,278 shares vesting on February 18, 2016, contingent upon Mr. Meierhoefer's continued service as of each such date. |
| |
(27) | Restricted stock unit awards with 4,950 shares vesting on February 18, 2015, 4,950 shares vesting on February 18, 2016, and 5,100 shares vesting on February 18, 2017, contingent upon Mr. Meierhoefer's continued service as of each such date. |
| |
(28) | comScore’s right of repurchase lapses for 1,652 shares on March 15, 2015, contingent upon Ms. Lin's continued service on such date. |
| |
(29) | comScore’s right of repurchase lapses for 6,250 shares annually on March 15, contingent upon Ms. Lin's continued service on such date. |
| |
(30) | Restricted stock unit awards with 3,628 shares vesting on March 15, 2015, contingent upon Ms. Lin's continued service on such date. |
| |
(31) | Restricted stock unit awards with 8,333 shares vesting on February 18, 2015 and 8,334 shares vesting on February 18, 2016, contingent upon Ms. Lin's continued service on such date. |
| |
(32) | Restricted stock unit awards with 6,277 shares vesting on February 18, 2015 and 6,278 shares vesting on February 18, 2016, contingent upon Ms. Lin's continued service on such date. |
| |
(33) | Restricted stock unit awards with 4,950 shares vesting on February 18, 2015, 4,950 shares vesting on February 18, 2016, and 5,100 shares vesting on February 18, 2017, contingent upon Ms. Lin's continued service on such date. |
| |
(34) | Restrictedthese performance-based restricted stock units granted following Mr. Tarpey's retirement on August 28, 2014was deemed satisfied and such performance-based restricted stock units remain eligible to be earned subject to achievement of the applicable performance goals. |
| (b) | As described below under “Payment Upon Termination or Change in Control—Hofstetter Separation Agreement,” in connection with appointmentMs. Hofstetter’s resignation, the service requirement with respect to these performance-based restricted stock units was deemed satisfied and such performance-based restricted stock units remain eligible to be earned subject to achievement of the Company's advisory board.applicable performance goals. |
| (4) | Award granted under the Rentrak Corporation 2005 Stock Incentive Plan and assumed by the company on January 29, 2016 in connection with the Rentrak merger. |
| (5) | Award granted under the Rentrak Corporation 2011 Stock Incentive Plan and assumed by the company on January 29, 2016 in connection with the Rentrak merger. |
20142019 Option Exercises and Stock Vested Table
The following table showssets forth certain information concerning the stock options that were exercised and value realized upon exercise, as well as all stock awards that vested and value realized upon vesting, bynumber of shares our named executive officers acquired and the value they realized upon vesting of stock awards during 2019. Values are shown before payment of any applicable withholding taxes or brokerage commissions. None of our named executive officers exercised options in 2019. The values reported in the year ended December 31, 2014. Mr. Wesley didtable below may not have option exercises or stock vesting occur during 2014.represent the actual amounts received by the executive upon settlement of the awards due to the delayed delivery of shares.
|
| | | | | | | | |
| Name | Option Awards | Stock Awards |
Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($)(1) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($) |
| Serge Matta | — |
| — |
| 7,500 |
| 238,950(2) |
|
| | — |
| — |
| 1,858 |
| 59,196(2) |
|
| | — |
| — |
| 8,750 |
| 278,775(2) |
|
| | — |
| — |
| 16,666 |
| 531,312(3) |
|
| | — |
| — |
| 31,505(4) |
| 974,135(5) |
|
| | — |
| — |
| 2,268 |
| 70,127(5) |
|
| | — |
| — |
| 4,857 |
| 150,178(5) |
|
| | — |
| — |
| 5,000 |
| 195,950(6) |
|
| | | | | |
| Magid M. Abraham, Ph.D. | — |
| — |
| 8,694 |
| 276,991(2) |
|
| | — |
| — |
| 96,667 |
| 3,056,611(7) |
|
| | — |
| — |
| 65,250 |
| 2,063,205(7) |
|
| | — |
| — |
| 9,981 |
| 308,613(5) |
|
| | — |
| — |
| 70,000 |
| 2,307,900(8) |
|
| | — |
| — |
| 1,785(9) |
| 58,530(10) |
|
| | — |
| — |
| 1,649(9) |
| 58,507(11) |
|
| | — |
| — |
| 1,607(9) |
| 58,511(12) |
|
| | — |
| — |
| 1,260(9) |
| 58,502(13) |
|
| | | | | |
| Gian M. Fulgoni | — |
| — |
| 6,137 |
| 195,525(2) |
|
| | — |
| — |
| 8,333 |
| 265,489(2) |
|
| | — |
| — |
| 26,256(4) |
| 837,041(3) |
|
| | — |
| — |
| 6,695 |
| 207,009(5) |
|
| | — |
| — |
| 8,750 |
| 270,550(5) |
|
| | — |
| — |
| 3,460 |
| 106,983(5) |
|
| | — |
| — |
| 2,532(9) |
| 83,024(10) |
|
| | — |
| — |
| 2,340(9) |
| 83,023(11) |
|
| | — |
| — |
| 2,280(9) |
| 83,015(12) |
|
| | — |
| — |
| 1,788(9) |
| 83,017(13) |
|
| | | | | |
| Cameron Meierhoefer | — |
| — |
| 3,750 |
| 119,475(2) |
|
| | — |
| — |
| 1,839 |
| 58,591(2) |
|
| | — |
| — |
| 8,333 |
| 265,489(2) |
|
| | — |
| — |
| 13,261(4) |
| 422,761(3) |
|
| | — |
| — |
| 1,542 |
| 47,679(5) |
|
| | — |
| — |
| 8,750 |
| 270,550(5) |
|
| | — |
| — |
| 3,806 |
| 117,682(5) |
|
| | | | | |
| Christiana Lin | — |
| — |
| 500 |
| 15,930(2) |
|
| | — |
| — |
| 5,000 |
| 159,300(2) |
|
| | — |
| — |
| 2,231 |
| 71,080(2) |
|
| | — |
| — |
| 8,333 |
| 265,489(2) |
|
| | — |
| — |
| 12,775(4) |
| 407,267(3) |
|
| | — |
| — |
| 1,652 |
| 51,080(5) |
|
|
| | | | | | | | |
| Name | Option Awards | Stock Awards |
Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($)(1) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($) |
| | — |
| — |
| 6,250 |
| 193,250(5) |
|
| | — |
| — |
| 3,628 |
| 112,178(5) |
|
| | 5000 |
| 173400 |
| — |
| — |
|
| | 5000 |
| 183950 |
| — |
| — |
|
| | | | | |
Kenneth J. Tarpey (retired August 28, 2014) | — |
| — |
| 5,000 |
| 159,300(2) |
|
| | — |
| — |
| 4,147 |
| 132,123(2) |
|
| | — |
| — |
| 8,333 |
| 265,489(2) |
|
| | — |
| — |
| 16,833(4) |
| 536,636(3) |
|
| | — |
| — |
| 2,381 |
| 73,621(5) |
|
| | — |
| — |
| 8,750 |
| 270,550(5) |
|
| | — |
| — |
| 1,262 |
| 39,021(5) |
|
| | — |
| — |
| 6,205 |
| 243,174(6) |
|
| | — |
| — |
| 2,381(14) |
| 93,311(6) |
|
| | — |
| — |
| 8,750(14) |
| 342,913(6) |
|
| | — |
| — |
| 1,262(14) |
| 49,458(6) |
|
| | — |
| — |
| 8,333(14) |
| 326,570(6) |
|
| | — |
| — |
| 6,277(14) |
| 245,996(6) |
|
| |
| (1) | The value realized on exercise is calculated as the difference between the actual sales price of the shares underlying the options exercised and the applicable exercise price of those options. |
| |
(2) | The value realized on vesting is calculated by multiplying the number of shares vestingof stock or units by the market valueclosing price of the underlying shares on the vesting date, which was $31.86 per share at market close as listed by the NASDAQ Global Market on February 18, 2014.date. |
| (2) | The value of the awards reported in this row include (a) $840,274 representing 354,546 deferred stock units that were fully vested on the date of grant but do not become payable to Mr. Fuller until a change of control of the company or six months after Mr. Fuller’s separation from service, and (b) $96,132 representing 11,390 restricted stock units that were granted for Mr. Fuller’s service as a non-employee director prior to becoming Interim Chief Executive Officer and that fully vested on June 10, 2019 but did not become payable until Mr. Fuller’s separation from service, which occurred on January 10, 2020, when the value of the award was $56,950. |
| (3) | The value realizedof the awards reported in this row include (a) $506,007 representing 24,988 restricted stock units that were fully vested on vestingMarch 31, 2019 but did not become payable to Mr. Wiener until October 2, 2019, when the value of the award was $48,227, (b) $736,027 representing 36,347 restricted stock units that were fully vested on March 31, 2019 but did not become payable to Mr. Wiener until October 15, 2019, when the value of the award was $68,332, and (c) $838,525 representing 36,347 restricted stock units that were fully vested on March 1, 2019 but did not become payable to Mr. Wiener until October 4, 2019, when the value of the award was $74,511. |
| (4) | The value of the awards reported in this row include (a) $372,944 representing 18,417 restricted stock units that were fully vested on March 31, 2019 but did not become payable to Ms. Hofstetter until October 7, 2019, when the value of the award was $40,886, and (b) $485,554 representing 21,047 restricted stock units that were fully vested on March 1, 2019 but did not become payable to Ms. Hofstetter until October 9, 2019, when the value of the award was $45,462. |
2019Non-Qualified
Deferred Compensation Table | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| | Deferred Stock Units and Deferred RSUs (3) | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | ) | | | | | | | | |
| (1) | This column represents the aggregate earnings (or losses) for 2019 for equity awards that vested in one tax year but whose settlement was deferred to a subsequent tax year. The earnings (or loss) amount for these awards represents an estimate of annual earnings with respect to vested but unpaid and deferred shares and is calculatedbased on the difference in closing price per share of our Common Stock of (a) in the case of Mr. Fuller, (i) $8.44 as of June 10, 2019 (for the 11,390 shares deferred under the 2018 director restricted stock unit award) and $2.37 as of November 4, 2019 (for the 354,546 deferred stock units granted in 2019) and (ii) $4.94 as of December 31, 2019, multiplied by multiplying the number of vested but deferred shares vestingthat were subject to these awards as of December 31, 2019, as described in more detail in Note 2 to this table below, and (b) in the case of Mr. Wiener, (i) $14.43 as of January 1, 2019 and (ii) $2.04 as of October 11, 2019, multiplied by the marketnumber of restricted stock units that were vested but deferred as of October 11, 2019, as described in more detail in Note 4 to this table below. |
| (2) | This column reflects the total value of the underlying365,936 vested but deferred common shares held by Mr. Fuller in 2019. The value is computed based on the vesting date,closing price of our Common Stock as reported on the Nasdaq Global Select Market on December 31, 2019, which was $31.88$4.94 per share at market close as listed byshare. These deferred common shares are included in the NASDAQ Global Market on February 19, 2014.2019 Option Exercises and Stock Vested Table above. The award of 354,546 deferred stock units granted in 2019 has also been included in the Summary Compensation Table for 2019 with a grant date fair value of $840,274. |
(4) Restricted stock units granted with immediate vesting.
| (3) | |
(5) | The value realizedThese deferred common shares include two separate awards that were vested in 2019 but with a deferred payout following 2019. These common shares do not become payable to Mr. Fuller until the earlier of Mr. Fuller’s separation from service (or with respect to Mr. Fuller’s deferred stock unit award granted on vesting is calculated by multiplying the numberNovember 4, 2019, six months after Mr. Fuller’s separation from service) or a change of shares vesting by the market valuecontrol of the underlying shares on the vesting date, which was $30.92 per share at market close as listed by the NASDAQ Global Market on March 14, 2014. |
| |
(6) | The value realized on vesting is calculated by multiplying the number of shares vesting by the market value of the underlying shares on the vesting date, which was $39.19 per share at market close as listed by the NASDAQ Global Market on August 15, 2014. |
| |
(7) | The value realized on vesting is calculated by multiplying the number of shares vesting by the market value of the underlying shares on the vesting date, which was $31.62 per share at market close as listed by the NASDAQ Global Market on February 28, 2014. |
| |
(8) | The value realized on vesting is calculated by multiplying the number of shares vesting by the market value of the underlying shares on the vesting date, which was $32.97 per share at market close as listed by the NASDAQ Global Market on March 29, 2014.company. |
(9) Restricted stock units granted with immediate vesting awarded in lieu
| (4) | Mr. Wiener’s deferred restricted stock units represent an award that vested in 2018 but with a deferred payout following 2018. The common shares underlying the award became payable to Mr. Wiener in connection with his resignation from the company. The amount reported in this row for Aggregate Withdrawals/Distributions represents the amount realized by Mr. Wiener upon settlement of this award on October 11, 2019. |
(10) The value realized on vesting is calculated by multiplying the number of shares vesting by the market value of the underlying shares on the vesting date, which was $32.79 per share at market close as listed by the NASDAQ Global Market on March 31, 2014.
(11) The value realized on vesting is calculated by multiplying the number of shares vesting by the market value of the underlying shares on the vesting date, which was $35.48 per share at market close as listed by the NASDAQ Global Market on June 30, 2014.
(12) The value realized on vesting is calculated by multiplying the number of shares vesting by the market value of the underlying shares on the vesting date, which was $36.41 per share at market close as listed by the NASDAQ Global Market on September 30, 2014.
(13) The value realized on vesting is calculated by multiplying the number of shares vesting by the market value of the underlying shares on the vesting date, which was $46.43 per share at market close as listed by the NASDAQ Global Market on December 31, 2014.
(14) Accelerated vesting of restricted stock units in connection with executive officer's retirement effective August 28, 2014 pursuant to terms of the Transition Agreement between the company and Mr. Tarpey dated May 5, 2014 (the "Transition Agreement").
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL
Potential Payments Upon Termination or Change in Control
We have entered intoLivek Change of Control and Severance Agreements (each an "Agreement") for certain membersAgreement
Mr. Livek is a party to a change of our management, including each of our current named executive officers,control and the term of these Agreements were amended to includeseverance agreement (the “Livek Agreement”). The Livek Agreement has a three-year initial term with an automatic three-year renewal, unless either party provides written noticerenewals thereafter, and in the event of non-renewal at least sixty days prior toa change of control, will continue in effect through the longer of the date that is 12 months following the effective date of automatic renewal. These agreements supersede any existing severancethe change of control or changethe remainder of the term then in control provisions included in our named executive officer’s respective employment agreements or letter agreements.
Each agreementeffect. The Livek Agreement provides that if
prior to a change in control of our Company, we terminate
such named executive officer’s employmentMr. Livek without
cause,“cause” or
such named executive officerMr. Livek resigns
from such employment for
good reason,“good reason” (each as described below), then, subject to
his compliance with certain post-employment covenants
heand execution andnon-revocation
of a release of claims in favor of the company, Mr. Livek would be eligible to receive
the following payments and benefits:payment of all(i) accrued but unpaid vacation, expense reimbursements, wages and other benefits due under our compensation plans, policies and arrangements;
continuing payments at a rate equal to his annual base salary then in effect, for the duration of a specified severance period (as identified in the table below for each such named executive officer), to be paid periodically in accordance with our normal payroll policies; and
arrangements (the “Accrued Amounts”); (ii) reimbursement of COBRA premiums (or an equivalent cash distribution if histhe severance period exceeds the permitted COBRA participation period) until the earlier of the expiration of the specified severance period or the date that he becomes covered under a similar plan.
The following table identifies the severance period specifiedfor two years; and (iii) two times Mr. Livek’s annual base salary, payable over two years in the Agreements for each named executive officer, except Mr. Tarpey who retired effective August 28, 2014:
|
| |
Name and Principal Position | Severance Period |
Serge Matta | 2 years |
Magid M. Abraham, Ph.D. | 2 years |
Gian M. Fulgoni | 1.5 years |
Melvin Wesley III | 6 months for first 2 years as CFO, then 1.25 years |
Cameron Meierhoefer | 1 year |
Christiana Lin | 1 year |
Change in Control of the Company
Each of the Agreements also provides thataccordance with our normal payroll practices (or if such termination is on or within 12 months afterfollowing a change of control, in control of our Company, the named executive officer’s employment is terminated without cause, or such named executive officer resigns for good reason, then, subject to his compliance with certain post-employment covenants, he would be eligible to receive the following payments and benefits:
payment of all accrued but unpaid vacation, expense reimbursements, wages and other benefits due under our plans, policies and arrangements;
a lump sum payment (less applicable withholding taxes) equal to a specified change in control multiple (as identified in the chart below for each such named executive officer) multiplied by his annual base salary in effect immediately prior to his termination datesum).
Additionally, if (a) Mr. Livek has remained employed or if greater, at the level in effect immediately prior to the change in control; and
reimbursement of COBRA premiums (or an equivalent cash distribution if his severance period exceeds the permitted COBRA participation period) until the earlier of the expiration of a specified severance period (as identified in the table above for each such named executive officer) or the date that such he becomes covered under a similar plan.
The following table identifies the change in control multiple specified in the agreements for each named executive officer:
|
| |
Name and Principal Position | Change of Control Multiple |
Serge Matta | 2x |
Magid M. Abraham, Ph.D. | 2x |
Gian M. Fulgoni | 1.5x |
Melvin Wesley III | 1.25x |
Cameron Meierhoefer | 1x |
Christiana Lin | 1x |
Further, each of the Agreements with Messrs. Matta, Wesley, and Meierhoefer and Ms. Lin provides that if each such named executive officer remains employed by or continuescontinued to provide services to us through the one-yearfirst anniversary of the date of a change of control or (b) we terminate Mr. Livek without cause or Mr. Livek resigns for good reason on or within 12 months following a change of our Company,control, then, in each case and except as otherwise described below under “Livek 2019 Equity Agreements,” all of hisMr. Livek’s outstanding and unvested equity awards held as of the date of a change of control will vest in full.The agreements
Under the Livek Agreement, “cause” is defined as Mr. Livek’s indictment, plea of nolo contendere or conviction of any felony or any crime involving dishonesty; material breach of duties or a company policy; or commission of any act of dishonesty, embezzlement, theft, fraud or misconduct with Dr. Abrahamrespect to the company, any of which in the good faith and reasonable determination of the Board or the Compensation Committee is materially detrimental to the company, its business or its reputation. “Good reason” is defined as Mr. Fulgoni provideLivek’s termination of employment within 90 days after the expiration of a specified cure period following the occurrence of one or more of the following: (i) a material diminution in his base compensation (unless done for accelerated vesting of all of their then outstanding and unvested equity awards uponour senior-level executives); (ii) a material reduction of his authority or responsibilities or, following a change of control, a change in controlhis reporting position; or (iii) a relocation of our Company. These “single-trigger” acceleration arrangements are consistent with the existing equity awards held by Dr. Abraham and Mr. Fulgoni.his primary workplace of more than 50 miles.
In the event that the payments or benefits under
an agreementthe Livek Agreement (i) would
(i) constitute “parachute payments” within the meaning of Section 280G of the
Internal Revenue Code
and (ii) would subject Mr. Livek to an excise tax under Section 4999 of the Code, then, depending on which method produces the largest netafter-tax
benefit for Mr. Livek, the payments shall either be: (a) reduced to the level at which no excise tax applies or (b) paid in full, which would subject Mr. Livek to the excise tax.In 2019, Mr. Livek was granted equity awards in the form of stock options, restricted stock units (“RSUs”), and performance-based RSUs (“PRSUs”). Each of these award agreements provides for certain treatment upon a qualifying termination of employment and/or change of control. The award agreements evidencing the grant of options and RSUs to Mr. Livek in 2019 both provide that if we terminate Mr. Livek without “cause” or if Mr. Livek resigns for “good reason” (both terms as defined in the Livek Agreement) within one year following a change of control, the applicable equity award will become fully vested. The award agreement evidencing the grant of PRSUs to Mr. Livek in 2019 provides that (a) if we terminate Mr. Livek without “cause” or if Mr. Livek resigns or terminates employment as a result of death or “disability” (both terms as defined in the Livek Agreement), the PRSUs will become vested based on actual achievement of the stock price hurdle during the period beginning on the most recent vesting date preceding the date of termination and ending on the date of such termination, and (b) if a change of control occurs, the PRSUs will become vested by applying theper-share
price paid in connection with the change of control as the stock price hurdle for purposes of determining attainment of performance goals. Livek 2019 Letter Agreement
In connection with his appointment as Chief Executive Officer, we and Mr. Livek entered into a letter agreement on November 4, 2019 (the
“Code”“Livek 2019 Letter Agreement) pursuant to which Mr. Livek is eligible to receive aone-time
bonus of at least $1,000,000 (either individually or as part of a larger pool for executive officers or employees) upon the successful completion of a refinance of all or substantially all of our outstanding senior secured convertible notes, subject to Mr. Livek’s continued
employment through such refinance, provided that if we terminate Mr. Livek without “cause” or if Mr. Livek resigns for “good reason” (both terms as defined in the Livek Agreement) within the90-day
period preceding the completion of the refinance, Mr. Livek will remain eligible to receive the bonusupon the completion of the refinance. Upon the consummation of a change in control (as defined in the Plan, but provided that the occurrence of clause (b) (relating to a majority change in the incumbent board) or (d) (relating to stockholder approval of a dissolution of the company) of such definition shall not be treated as a change in control for purposes of the Livek 2019 Letter Agreement), Mr. Livek will receive aone-time
bonus of $1,000,000, plus an additionalone-time
bonus based on specified percentages (ranging from 0.30% to 0.32%)
of the gross transaction proceeds (but no more than $4,000,000) resulting from such change in control so long as the change in control results in gross transaction proceeds of at least $500 million. Each bonus payable upon the consummation of a change in control is generally subject to Mr. Livek’s continued employment through such change in control, provided that if we terminate Mr. Livek without cause or
if Mr. Livek resigns for good reason within the90-day
period preceding the consummation of the change in control, Mr. Livek will remain eligible to receive such bonus upon the consummation of such change in control. Other NEO Change of Control and Severance Agreements
Each of Messrs. Fink and Wilson and Ms. DiBattiste is a party to a change of control and severance agreement (the “Other NEO Agreements”). The Other NEO Agreements have a three-year initial term with automaticone-year
renewals thereafter, and in the event of a change of control will continue in effect through the longer of the date that is 12 months following the effective date of the change of control or the remainder of the term then in effect. The Other NEO Agreements provide that if we terminate the executive without “cause” or the executive resigns for “good reason” (each as described below), then, subject to compliance with certain post-employment covenants and execution andnon-revocation
of a release of claims in favor of the company, the executive would be eligible to receive (i) all Accrued Amounts; (ii) reimbursement of COBRA premiums (or an equivalent cash distribution if the severance period exceeds the permitted COBRA participation period) for one year (or 15 months for Mr. Fink); and (iii) the following severance payments, depending on the time of termination or resignation: | | | | |
| | Time of Termination or Resignation |
| | Prior to a Change of Control | | On or Within 12 Months Following a Change of
Control |
| | For Ms. DiBattiste and Mr. Wilson: The sum of the executive’s (A) annual base salary and (B) target short-term incentive award, paid over one year in accordance with our normal payroll practices. For Mr. Fink: 1.25 times the sum of the executive’s (A) annual base salary and (B) target short-term incentive award, paid over 15 months in accordance with our normal payroll practices. | | For Ms. DiBattiste and Mr. Wilson: The sum of the executive’s (A) annual base salary and (B) target short-term incentive award, paid 60 days following termination. For Mr. Fink: 1.25 times the sum of the executive’s (A) annual base salary and (B) target short-term incentive award, paid 60 days following termination. |
| | | | |
Current Year Short-Term Incentive Award | | Pro-rata portion based on actual performance through the end of the applicable year, paid at the time short-term incentive awards are paid to other senior executives. | | Pro-rata portion of the greater of (A) the executive’s target short-term incentive award for the year of termination and (B) the projected full-year short-term incentive award, paid 60 days following termination. |
| | | | |
Time-Based Equity Acceleration | | | | |
| | | | |
| | Time of Termination or Resignation |
| | Prior to a Change of Control | | On or Within 12 Months Following a Change of
Control |
| | | | |
Performance-Based Equity Acceleration | | | | Except as otherwise described below under “Wilson 2019 PRSU Award,” acceleration as to the greater of (A) the target number of shares subject to the applicable equity award or (B) if 50% of the performance period has elapsed, the projected number of shares that would have been earned through the end of the performance period. |
Under the Other NEO Agreements, “cause” is defined as the executive’s indictment, plea of nolo contendere or conviction of any felony or any crime involving dishonesty; material breach of duties or a company policy (that is not cured by the executive within 30 days following written notice); or commission of any act of dishonesty, embezzlement, theft, fraud or misconduct with respect to the company, any of which in the good faith and reasonable determination of the Board of Directors or the Compensation Committee is materially detrimental to the company, its business or its reputation. With respect to severance benefits related to short-term incentive awards under the Other NEO Agreements and equity awards granted on or after September 4, 2018, “good reason” is defined as an executive’s termination of employment within 90 days after a specified cure period following the occurrence of one or more of the following: (i) a material diminution in the executive’s base compensation (unless done for all of our senior-level executives); (ii) a relocation of the executive’s primary workplace of over 50 miles; or (iii) with respect to Mr. Fink and Ms. DiBattiste, a material diminution in the executive’s authority or responsibilities. For purposes of all other severance and other benefits (including all equity awards granted prior to September 4, 2018), “good reason” is defined as an executive’s termination of employment within 90 days after a specified cure period following the occurrence of one or more of the following: (i) a material diminution in the executive’s base compensation (unless such diminution applies to all senior-level executives); (ii) a material reduction of the executive’s authority or responsibilities or, following a change of control, a change in the executive’s reporting position; or (iii) a relocation of the executive’s primary workplace of over 50 miles. Termination will not be considered for “good reason” if the compensation is subject to any clawback provisions.
In the event that the payments or benefits under the Other NEO Agreements (i) would constitute “parachute payments” within the meaning of Section 280G of the Code and (ii) would subject the
named executive
officer to the excise tax imposed by Section 4999 of the Code,
eachthen, depending on which method produces the largest netafter-tax
benefit for the executive, the payments shall either be: (a) reduced to the level at which no excise tax applies or (b) paid in full, which would subject the individual to the excise tax. In 2019, Mr. Wilson was granted PRSUs that provide for certain treatment upon a qualifying termination of employment and/or change of control. The award agreement evidencing the grant of PRSUs to Mr. Wilson in 2019 provides that (a) if we terminate Mr. Wilson without “cause” or if Mr. Wilson resigns or terminates employment as a result of death or “disability” (both terms as defined in the Other NEO Agreement), the PRSUs will become vested based on actual achievement of the stock price hurdle during the period beginning on the most recent vesting date preceding the date of termination and ending on the date of such named executive officer would receive such payment as would entitle him to receive the greatest “after-tax” benefit.
The following table estimates the value of any accelerated vesting of any outstanding equity awards that would have been due to each named executive officer (with the exception of Mr. Tarpey who retired effective August 28, 2014) in connection withtermination, and (b) if a change of control
of our Company, assumingoccurs, the PRSUs will become vested by applying theper-share
price paid in connection with the change of control
occurredas the stock price hurdle for purposes of determining attainment of performance goals.In connection with his service as Interim Chief Executive Officer, Mr. Fuller received a deferred stock unit award (the “”) on
November 4, 2019. Pursuant to the terms of the DSU Award, the DSU Award was fully vested on the date of grant and will be delivered to Mr. Fuller in shares of Common Stock upon the earlier of a change in control or six months following Mr. Fuller’s separation from service with the company. Additionally, in connection with his service as anon-employee
director of the company, Mr. Fuller was granted a restricted stock unit award (the “”) on July 2, 2018. Pursuant to the terms of the Fuller Director Award, the restricted stock units fully vested on June 10, 2019 and were scheduled to be delivered to Mr. Fuller in shares of Common Stock upon the earlier of a change of control or a separation from service with the company. In connection with Mr. Fuller’s resignation from our Board on January 10, 2020, shares of Common Stock were delivered to Mr. Fuller in January 2020 in settlement of the Fuller Director Award.
Wiener Separation Agreement
In connection with Mr. Wiener’s resignation, the company and Mr. Wiener entered into a Separation Agreement on March 31, 2019 (the “Wiener Separation Agreement”). Pursuant to the terms of the Wiener Separation Agreement, Mr. Wiener received or will receive: (i) a cash payment of $1,050,000, less applicable taxes and withholdings, half of which was paid in installments over thesix-month
period following his termination of employment and the other half of which was paid in a lump sum in March 2020, (ii) a target bonus for 2019 of $65,000, subject to achievement of applicable performance goals, (iii) reimbursement of the cost of continued health coverage under our group health plans pursuant to COBRA for a period of up to 18 months, (iv) reimbursement of $50,000 of legal expenses in connection with negotiating the Wiener Separation Agreement, (v) accelerated vesting of 61,335 outstanding restricted stock units, and (vi) satisfaction of the service requirement with respect to 36,347 outstanding performance-based restricted stock units, which will remain eligible to be earned subject to achievement of the applicable performance goals. Under the Wiener Separation Agreement, Mr. Wiener agreed to a comprehensive release of claims in favor of the company and its affiliates. Mr. Wiener also reaffirmed his commitment to be bound by restrictive covenants regarding confidential information,non-disparagement,
non-competition
andnon-solicitation.
Hofstetter Separation Agreement
In connection with Ms. Hofstetter’s resignation, the company and Ms. Hofstetter entered into a Separation Agreement on March 31, 2019 (the “Hofstetter Separation Agreement”). Pursuant to the terms of the Hofstetter Separation Agreement, Ms. Hofstetter received or will receive: (i) a cash payment of $450,000, less applicable taxes and withholdings, which was paid in installments over the12-month
period following her termination of employment, (ii) a target bonus for 2019 of $42,000, subject to achievement of applicable performance goals, (iii) reimbursement of the cost of continued health coverage under our group health plans pursuant to COBRA for 12 months, (iv) reimbursement of $10,000 of legal expenses in connection with negotiating the Hofstetter Separation Agreement, (v) an additional cash payment of $218,450, less applicable taxes and withholdings, which was paid in a lump sum in 2019, (vi) accelerated vesting of 18,417 outstanding restricted stock units, and (vii) satisfaction of the service requirement with respect to 8,524 outstanding performance-based restricted stock units, which will remain eligible to be earned subject to achievement of the applicable performance goals. Under the Hofstetter Separation Agreement, Ms. Hofstetter agreed to a comprehensive release of claims in favor of the company and its affiliates. Ms. Hofstetter also reaffirmed her commitment to be bound by restrictive covenants regarding confidential information,non-disparagement,
non-competition
andnon-solicitation.
Bachmann Separation Agreement
In connection with Ms. Bachmann’s resignation, the company and Ms. Bachmann entered into a Separation Agreement on May 28, 2019 (the “Bachmann Separation Agreement”). Pursuant to the terms of the Bachmann Separation Agreement, Ms. Bachmann received: (i) a lump sum cash payment of $116,667, less applicable taxes and withholdings, which was paid in 2019, and (ii) payments of the cost of continued health coverage under our group health plans pursuant to COBRA through December 31, 2014.2019.
Under the Bachmann Separation Agreement, Ms. Bachmann agreed to a comprehensive release of claims in favor of the company and its affiliates. Ms. Bachmann also reaffirmed her commitment to be bound by restrictive covenants regarding confidential information,non-competition
andnon-solicitation.
|
| | | |
| Name | Market Value of Accelerated Equity (net of exercise price, if any)(1) |
| Serge Matta | —(2) |
|
| Magid M. Abraham, Ph.D. | $ | 10,445,868 | (3)(4) |
| Gian M. Fulgoni | 3,126,643(3) |
| Melvin Wesley III | —(2) |
|
| Cameron Meierhoefer | —(2) |
|
| Christiana Lin | —(2) |
|
Payments Upon Termination of Employment for Departing Named Executive Officers
The following table quantifies the actual payments and benefits that we provided to Messrs. Wiener and Fuller and Ms. Hofstetter and Ms. Bachmann in connection with their termination of employment, pursuant to the terms of their respective agreements.
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| (1) | BasedRepresents the full amount of COBRA reimbursements payable under the named executive officer’s separation agreement. For purposes of this disclosure, we have assumed that (i) the named executive officer elected continuation healthcare coverage under COBRA for the full severance period and (ii) the reimbursement right has not ceased due to employment of the named executive officer with another employer. For the portion representing COBRA reimbursements payable in 2019, the amount includes the actual amount paid to the named executive officer in 2019. |
| (2) | Represents the amount paid for the named executive officer’s legal expenses in connection with the negotiation of the executive’s separation agreement. |
| (3) | Represents a cash payment of (i) $1,050,000 (half of which was paid in a lump sum in March 2020) and (ii) $48,750 (representing a portion of Mr. Wiener’s annual incentive opportunity for his service through March 31, 2019). |
| (4) | Represents 24,988 of the outstanding and unvested time-based restricted stock units that were granted to Mr. Wiener as part of his sign-on equity award on an assumed fair market valueJune 5, 2018 and 36,347 of the outstanding and unvested time-based restricted stock units that were granted to Mr. Wiener as part of his 2018 long-term incentive equity award on September 7, 2018, each of which vested on March 31, 2019, in connection with Mr. Wiener’s termination of employment, calculated for purposes of this column by multiplying the number of such shares by the closing price per share of our common stock of $46.43,Common Stock on March 31, 2019, which was the closing price of our common$20.25 per share. All other outstanding and unvested time-based restricted stock as reportedunits held by the NASDAQ Global Market on December 31, 2014. |
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(2) | EachMr. Wiener were forfeited upon his termination date. Additionally, 36,347 of the agreements with Messrs. Wesley, Mattaperformance-based restricted stock units originally granted to Mr. Wiener on September 7, 2018 remained outstanding following his termination and Meierhoefer and Ms. Lin providescontinue to vest. The table above does not include amounts that if each such named executive officer remains employed by or continueswould be realized from this continued vesting of awards, but rather reflects only the awards that were accelerated. |
| (5) | Mr. Fuller was granted an award of 354,546 deferred stock units on November 4, 2019 that was fully vested on the date of grant but does not become payable to provide services to us throughMr. Fuller until the one-year anniversaryearlier of a change of control of the Company company or six months after Mr. Fuller’s separation from service. Additionally, Mr. Fuller held 11,390 vested stock units that were granted to him in connection with his service as anon-employee director prior to becoming Interim Chief Executive Officer that did not become payable until Mr. Fuller’s separation from service. Although Mr. Fuller’s employment terminated and he was no longer an executive officer of the company on November 4, 2019, these amounts were not yet payable on December 31, 2019 because he was serving as a director and consultant for the company on December 31, 2019. |
| (6) | Represents a cash payment of (i) $450,000 (representing one year of base salary), all(ii) $31,500 (representing a portion of such named executive officer’sMs. Hofstetter’s annual incentive opportunity for her service through March 31, 2019) and (iii) $218,450 (representing the unpaid portion of Ms. Hofstetter’s cashsign-on bonus). |
| (7) | Represents 18,417 of the outstanding and unvested time-based restricted stock units that were granted to Ms. Hofstetter as part of her sign-on equity awards asaward on October 4, 2018 that vested on March 31, 2019, in connection with Ms. Hofstetter’s termination of employment, calculated for purposes of this column by multiplying the number of such shares by the closing price per share of our Common Stock on March 31, 2019 which was $20.25 per share. Additionally, 8,524 of the performance-based restricted stock units originally granted to Ms. Hofstetter on October 4, 2018 remained outstanding following her termination and continue to vest. The table above does not include amounts that would be realized from this continued vesting of awards, but rather reflects only the awards that were accelerated. |
| (8) | Represents a lump sum cash payment of $116,667 (representing four months of base salary). |
Potential Payments Upon Termination or Change of Control for Remaining Named Executive Officers
The following tables show the value of the potential payments that each named executive officer would have received in various scenarios involving a termination of his or her employment or change of control event, assuming a December 31, 2019 triggering date and, where applicable, a price per share for our Common Stock of $4.94 (the closing price of our Common Stock on the Nasdaq Global Select Market on December 31, 2019).
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Payments Upon Termination | | | | | | | | | | | | | | | |
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| (1) | Represents the amount payable if Mr. Livek were terminated without cause or resigned for good reason on or within 12 months after a change of control. |
| (2) | Represents the minimum bonus payable under the Livek 2019 Letter Agreement if we terminate Mr. Livek without cause or if Mr. Livek resigns for good reason, as applicable, within the 90-day period preceding the completion of a refinancing transaction described in the Livek 2019 Letter Agreement. |
| (3) | Represents the minimum bonus payable under the Livek 2019 Letter Agreement if we terminate Mr. Livek without cause or if Mr. Livek resigns for good reason within the 90-day period preceding the consummation of a change in control. |
| (4) | Represents the amount payable if Mr. Livek elected continuation healthcare coverage under COBRA for the full 24-month severance period. |
| (5) | Represents (i) the fair market value of unvested time-based restricted stock unit awards and (ii) the difference between the fair market value of the common shares underlying unvested options and the exercise price of such changeoptions, in each case, the vesting of controlwhich would then become vested in full. |
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(3) | Dr. Abraham andhave accelerated if Mr. Fulgoni are parties to Severance and Change of Control Agreements whereby each named executive officer’s outstanding and unvested equity awards become vested in full uponLivek were terminated without cause or resigned for good reason on or within 12 months after a change of control, or if he remained employed by or continued to provide services to the company through theone-year anniversary of the Company. |
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(4) | a change of control. The referenced amount includes the accelerationvalue of 145,000 unvestedaccelerated vesting of Mr. Livek’s performance-based restricted stock andunit award granted to him in 2019 is not included in these amounts because the stock price hurdles would not have been achieved assuming a termination or change of control occurring on December 31, 2019. |
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Payments Upon Termination | | | | | | | | | | | | | | | |
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| (1) | Represents the amount payable if Mr. Fink were terminated without cause or resigned for good reason on or within 12 months after a change of control. |
| (2) | Represents a pro-rata portion of the applicable short-term incentive amount, which pro rata portion is equal to 100% of such amount assuming the termination occurred on December 31, 2019. |
| (3) | Represents the amount payable if Mr. Fink elected continuation healthcare coverage under COBRA for the full severance period. |
| (4) | Represents the fair market value of (i) unvested time-based restricted stock units held by Dr. Abrahamunit awards and (ii) the target amount of performance-based restricted stock unit awards, the vesting of which would have accelerated if Mr. Fink were terminated without cause or resigned for good reason on or within 12 months after a change of control. |
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Payments Upon Termination | | | | | | | | | | | | | | | |
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| (1) | Represents the amount payable if Ms. DiBattiste were terminated without cause or resigned for good reason on or within 12 months after a change of control. |
| (2) | Represents a pro-rata portion of the applicable short-term incentive amount, whichpro-rata portion is equal to 100% of such amount assuming the termination occurred on December 31, 2019. |
| (3) | Represents the amount payable if Ms. DiBattiste elected continuation healthcare coverage under COBRA for the full severance period. |
| (4) | Represents the fair market value of (i) unvested time-based restricted stock unit awards, (ii) the target amount of outstanding performance-based restricted stock unit awards, and (iii) the number of shares performance-vested under performance-based restricted stock unit awards whose performance period ended on December 31, 2019 (determined based on actual performance through the end of such performance period), which remained unvested as to time-based vesting requirements as of December 31, 2014. Of2019, the vesting of all of which would have accelerated if Ms. DiBattiste were terminated without cause or resigned for good reason on or within 12 months after a change of control. |
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Payments Upon Termination | | | | | | | | | | | | | | | |
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| (1) | Represents the amount payable if Mr. Wilson were terminated without cause or resigned for good reason on or within 12 months after a change of control. |
| (2) | Represents a pro-rata portion of the applicable short-term incentive amount, whichpro-rata portion is equal to 100% of such amount 28,352 restricted stock units related to overachievement of pre-established targets were subsequently canceled in 2015 asassuming the components of 2014 performance awards did not satisfytermination occurred on December 31, 2019. |
| (3) | Represents the vesting criteria required to earn such shares. Excluding these shares,amount payable if Mr. Wilson elected continuation healthcare coverage under COBRA for the full severance period. |
| (4) | Represents the fair market value of acceleratingunvested time-based restricted stock unit awards, the outstanding and unvested equity awardsvesting of Dr. Abraham aswhich would have accelerated if Mr. Wilson were terminated without cause or resigned for good reason on or within 12 months after a change of control. The value of accelerated vesting of Mr. Wilson’s performance-based restricted stock unit award granted to him in 2019 is not included in these amounts because the stock price hurdles would not have been achieved assuming a termination or change of control occurring on December 31, 2014 would have been $9,129,484. |
Termination of Employment Not in Connection with a Change in Control
The following table estimates the payments, benefits, and the value of any accelerated vesting of any outstanding equity awards that would have been due to each named executive officer, with the exception of Mr. Tarpey who retired effective August 28, 2014, in the event that his or her employment had been terminated (other2019. The value of accelerated vesting of Mr. Wilson’s unvested options is not included in these amounts because the exercise price of the options was greater than in connection with a change in control of comScore) without cause or if such executive officer resigns with good reason, assuming the termination of employment occurred on December 31, 2014.
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| | Cash Payments | Market Value of Accelerated Equity (net of exercise price, if any)(3) |
| Name | Salary(1) | COBRA/ Insurance(2) |
| Serge Matta | $ | 950,000 |
| $ | 42,804 |
| $ | — |
|
| Magid M. Abraham, Ph.D. | 500,000 |
| 42,804 |
| 10,445,868(4)(5) |
| Gian M. Fulgoni | 562,500 |
| 21,012 |
| 3,126,643(4) |
| Melvin Wesley III | 160,000 |
| 6,555 |
| — |
|
| Cameron Meierhoefer | 353,000 |
| 21,402 |
| — |
|
| Christiana Lin | 333,000 |
| 21,139 |
| — |
|
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(1) | Salary to be paid at a rate equal to such named executive officer’s annual base salary then in effect, for the duration of a specified severance period, to be paid periodically in accordance with our normal payroll policies. |
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(2) | COBRA/Insurance payments are estimated based on the number of months of coverage for which we are contractually obligated and the current estimated premium costs. |
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(3) | Based on an assumed fair market value per share of our common stock of $46.43, which was the closing price of our common stock as reported by the NASDAQ Global MarketCommon Stock on December 31, 2014. |
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(4) | Dr. Abraham and Mr. Fulgoni are parties to Severance and Change of Control Agreements whereby each named executive officer’s outstanding and unvested equity awards become vested in full upon a termination of employment without cause or by the named executive officer for good reason.2019. |
(5) The referenced amount includes
As required by the
accelerationDodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(u) of
145,000 unvested performance-based restricted stockRegulation S-K,
we are providing the following information about the relationship of the annual total compensation of our employees and
restricted stock units held by Dr. Abrahamthe annual total compensation of Mr. Livek, our Chief Executive Officer as of December 31,
2014. Of2019.
For 2019, the ratio of the annual total compensation of Mr. Livek, our Chief Executive Officer (“CEO Compensation”), to the median of the annual total compensation of all of our employees other than our Chief Executive Officer (“Median Annual Compensation”) was 35 to 1. This ratio is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K,
using the data and assumptions summarized below. In this summary, we refer to the employee who received such
amount, 28,352 restricted stock units related to overachievement of pre-established targets were subsequently canceled in 2015Median Annual Compensation as the
components“Median Employee.” For purposes of
2014 performance awards did not satisfythis disclosure, the
vesting criteria requireddate used to
earn such shares. Excluding these shares,identify the
market valueMedian Employee was December 31, 2019 (the “Determination Date”). CEO Compensation for purposes of
accelerating the outstanding and unvested this disclosure represents annualized compensation for Mr. Livek for 2019, which (following annualization) was $2,932,558. This amount includes Mr. Livek’ssign-on
equity awards
based on the full grant-date fair value, calculated in accordance with ASC Topic 718. Additionally, because Mr. Livek was not employed as Chief Executive Officer for the entirety of
Dr. Abraham2019, we annualized the applicable compensation that he received for his service as Chief Executive Officer in 2019, and we excluded the compensation that he received for service as a special advisor prior to becoming our Chief Executive Officer. Therefore, the CEO Compensation amount provided above for purposes of our pay ratio calculation differs from the total compensation amount reflected within the 2019 Summary Compensation Table. The table below reflects the amounts shown within the 2019 Summary Compensation Table as well as the annualized value (excluding special advisor compensation), if any, that was used solely for the pay ratio calculation: For purposes of this disclosure, Median Annual Compensation was $84,985 and was calculated by totaling for our Median Employee all applicable elements of compensation for 2019 in accordance with Item 402(c)(2)(x) of Regulation S-K.
To identify the Median Employee, we first determined our employee population as of December 31, 2014 would have been $9,129,484.
Terminationthe Determination Date. We had 1317 employees, representing all full-time, part-time, seasonal and temporary employees of Employment in Connection with a Change in Control
The following table estimates the
payments, benefits,company and
our consolidated subsidiaries as of the
valueDetermination Date. As permitted by Item 402(u)(3) of
Regulation S-K,
this number does not include any
accelerated vesting of any outstandingindependent contractors or “leased” workers. We then measured compensation for the period beginning on January 1, 2019 and
unvested equity awards that would have been due to each named executive officer, with the exception of Mr. Tarpey who retired effective August 28, 2014, in the event that his or her employment had been terminated in connection with or within 12 months of a change in control of comScore without cause or if such executive officer resigns with good reason, assuming the termination of employment occurredending on December 31,
2014.2019 for these employees usingyear-to-date
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| | Cash Payments | Market Value of Accelerated Equity(net of exercise price, if any)(3) |
| Name | Salary(1) | COBRA/ Insurance(2) |
| Serge Matta | $ | 950,000 |
| $ | 42,804 |
| $ | 6,269,396 | (4)(5) |
| Magid M. Abraham, Ph.D. | 500,000 |
| 42,804 |
| 10,445,868 | (6)(7) |
| Gian M. Fulgoni | 562,500 |
| 21,012 |
| 3,126,643(6) |
|
| Melvin Wesley III | 400,000 |
| 16,387 |
| 464,300(4) |
|
| Cameron Meierhoefer | 353,000 |
| 21,402 |
| 3,114,107(4) |
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| Christiana Lin | 333,000 |
| 21,139 |
| 2,878,753(4) |
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W-2
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(1) | Gross amount of lump sum payment (prior to payment of applicable withhold taxes). |
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(2) | COBRA/Insurance payments are estimated based on the number of months of coverage for which we are contractually obligated and the current estimated premium costs. |
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(3) | Based on an assumed fair market value per share of our common stock of $46.43, which was the closing price of our common stock as reported by the NASDAQ Global Market on December 31, 2014. |
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(4) | Each of the agreements with Messrs. Matta, Wesley and Meierhoefer and Ms. Lin provides that if each such named executive officer remains employed by or continues to provide services to us through the one-year anniversary of a change in control of comScore, all of such named executive officer’s outstanding and unvested equity awards become vested in full. |
(5) Assumingearnings (or, outside of the United States, a change of control to occur on December 31, 2014 with a fair market value of $46.43, nocomparable local equivalent) as reflected in our U.S. and local payroll records for 2019. A portion of our employee workforce (full-time and part-time) worked for less than the Special Market-Based Equity Awards would accelerate. In March, 2015, twofull fiscal year due to commencing employment after the beginning of the four tranches offiscal year. In determining the restricted stock unit portion ofMedian Employee, we annualized the Special Market-Based Equity Awards vested and two of the four tranches of the options became exercisable, with 59,591 restricted stock units and 241,676 options remain unvested.
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(6) | Dr. Abraham and Mr. Fulgoni are parties to Severance and Change of Control Agreements whereby each named executive officer’s outstanding and unvested equity awards become vested in full upon a change in control of comScore. |
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(7) | The referenced amount includes the acceleration of 145,000 unvested performance-based restricted stock and restricted stock units held by Dr. Abraham as of December 31, 2014. Of such amount, 28,352 restricted stock units related to overachievement of pre-established targets were subsequently canceled in 2015 as the components of 2014 performance awards did not satisfy the vesting criteria required to earn such shares. Excluding these shares, the market value of accelerating the outstanding and unvested equity awards of Dr. Abraham as of December 31, 2014 would have been $9,129,484. |
Chief Financial Officer Departurecompensation for such individuals.
Mr. Tarpey retired as Chief Financial Officer effective August 28, 2014. On May 8, 2014, the Company announced Mr. Tarpey's intention to retire and the entry into a Transition Agreement with Mr. Tarpey dated May 5, 2014 (the "Transition Agreement"). Under the terms of the Transition Agreement, Mr. Tarpey agreed to assist with transitioning the position and duties of the chief financial officer. He continued to receive his salary, other employee benefits and vesting of his equity awards at the same levels and eligibility as immediately prior to the Transition Agreement until his retirement date. Pursuant to the Transition Agreement, Mr. Tarpey received a one-time distribution of shares based on a pro-rated calculation of his 2014 short-term incentive and the immediately vested performance-based portion of his 2014 long-term incentive pursuant to the Company's 2014 executive incentive plan. The incentive achievement amounts were determined based on the Company's first and second quarter revenue and Adjusted EBITDA results relative to the targets, with the assumption that Mr. Tarpey achieved 100% of of any management based objectives for those periods. No overachievement was assumed or allocated. In addition, vesting of 27,003 shares of restricted stock and restricted stock units previously granted to Mr. Tarpey were accelerated pursuant to the terms of the initial grants and the Company's 2007 Equity Incentive Plan.
For a further discussion of the agreements pursuant to which our named executive officers are entitled to payments upon a termination or change of control, see the section titled “Compensation Discussion and Analysis — Components of our Executive Compensation Program — Severance and Change of Control Arrangements.”
DIRECTOR COMPENSATION
Director Compensation Policies
Cash Retainers and Meeting Fees: During 2014, our non-employee directors were eligible to receive an annual cash retainer based on their general service on our Board of Directors and additional cash retainers for participation or serving as chair of certain committees of our Board of Directors. Our director compensation was last revised in February 2013 following the Nominating and Governance Committee's request to Compensia to undertake a review of director compensation in comparison to our compensation peer group, and the amount of the retainers was last determined by our Board of Directors based on the results of that review. Additionally, in October 2014, following the Nominating and Governance Committee's consultation with outside counsel and Compensia, our Board of Directors approved a lead independent director designation and revised the compensation policy to include a retainer for such designation.
During
2014,2019, our
non-employee
directors
other than Mr. Gotlieb were eligible to receive an annual cash retainer of $30,000 for
generaltheir service on
ourthe Board. Our Board
of Directors, and the lead independent director was eligible to receiveChairman, Mr. Rosenthal, received an additional cash retainer of
$20,000, prorated$120,000 for
service during 2014.such position in 2019.Non-employee
Additionaldirectors were also eligible to receive annual cash retainers for which memberstheir service on Board committees in 2019, as set forth below. Cash retainers were paid quarterly in arrears and were prorated for directors who joined or left the chairBoard or relevant committees during the year.
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| | $ | | | | $ | | |
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Nominating and Governance | | | | | | | | |
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| (1) | The Special Committee was disbanded on April 1, 2019. |
| (2) | Finance Committee members (other than the committee chair) also received $3,000 in meeting fees in 2019, reflecting a fee of $1,000 for each committee meeting held in 2019, excluding (i) meetings held in conjunction with a regularly scheduled Board meeting and (ii) the first committee meeting held outside of a regularly scheduled Board meeting. |
Effective January 1, 2020, the Board temporarily increased the compensation of our Board Chairman in connection with his role as the independent Board representative working with management on our strategic review process. In consideration of Directors were eligiblethe significant increase in 2014 wereresponsibilities, heightened oversight and extraordinary time commitment required for this role: (i) the annual cash retainer for such position was increased to $360,000, and (ii) our Chairman earned a temporary cash stipend of $180,000 per month for the first quarter of 2020. A portion of the annual retainer ($120,000) is paid quarterly in arrears. The balance of the retainer, as follows:
well as the entire monthly stipend, is deferred until the earlier of the Chairman’s separation from service or a change in control of the company. Effective April 1, 2020, the monthly stipend was discontinued.
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| | 2014 |
| Committee | Chairperson | Member |
| Audit | $ | 18,000 |
| $ | 10,000 |
|
| Compensation | 10,000 |
| 5,000 |
|
| Nominating and Governance | 7,500 |
| 3,000 |
|
InFor the
case of new 2019-2020 director compensation term, which began on July 1, 2019, ournon-employee
directors
these fees are prorated based on when the non-employee director joins our Board of Directors during the year. Employee directors are not compensated for board of director or committee service in addition to their regular employee compensation.Equity-Based Compensation: Non-employee directors are alsoother than Mr. Gotlieb were eligible to receive stock awards and option grants under our 2007 Equity Incentive Plan. Our non-employee directors are entitled to an annuala number of restricted stock award having an approximate valueunits equal to $250,000 divided by the closing market price of $125,000 atour Common Stock on the timedate of grant.
Each annual However, in light of declines in our stock price, our directors elected to reduce their compensation and use the closing market price of our Common Stock on the original date of approval, rather than the date of grant, to determine the number of restricted stock award vestsunits to award. This election resulted in a 48% reduction in the number of shares otherwise due to each director for the 2019-2020 term. These restricted stock units will vest in full on the earliest of (i) June 30, 2020, (ii) the date of our 2020 annual meeting of stockholders, or (iii) the date of a change in control of the company, subject to continued service through the applicable vesting date. Vested units will be deferred and delivered in shares of Common Stock upon the earlier of (i)a director’s separation from service or a change in control of the company.
In 2019, Ms. Bradford and Ms. Love also received restricted stock unit awards (prorated based on their service dates) as compensation for their service during the 2018-2019 director term. These restricted stock units vested in full on June 10, 2019 (the date of our 2019 annual meeting of stockholders) and will be delivered in shares of Common Stock upon the earlier of the director’s separation from service or a change in control of the company.
As compensation for his service as chairman of our Finance Committee in 2019, Mr. Martin received a special award of restricted stock units equal to $100,000 divided by the closing market price of our Common Stock on the date of grant. These restricted stock units will vest in full on the respective director’s nextearlier of May 23, 2020 (the first anniversary upon joining our Board of Directors, (ii) the date of grant) or a change in control of the first annual meetingcompany, subject to continued service through the applicable vesting date, and will be delivered in shares of Common Stock upon the earlier of Mr. Martin’s separation from service or a change in control of the company.
Finally, as an inducement for Mr. Gotlieb to join our Board in 2019, in recognition of his extensive industry experience and expected contributions to the company, and in order to further align his interests with those of our stockholders, followingMr. Gotlieb received a special award of restricted stock units equal to $900,000 divided by the closing market price of our Common Stock on the date of grantgrant. These restricted stock units vested in full on April 1, 2020 (the first anniversary of Mr. Gotlieb’s appointment) and will be delivered in shares of Common Stock upon the earlier of Mr. Gotlieb’s separation from service or (iii) a change in control of control.the company. Mr. Gotlieb was not eligible for any other compensation for his service on the Board in 2019.
Ms. McKenna resigned from the Board for health reasons on March 7, 2019, at which time her outstanding restricted stock units (awarded for her service during the 2018-2019 director term) were accelerated.
Mr. Norman resigned from the Board on May 22, 2019, at which time he transitioned to a strategic consultant to the Board and the company. Mr. Norman’s outstanding restricted stock units (awarded for his service during the 2018-2019 director term) were modified to allow for continued vesting during his consulting term. Mr. Norman also received aone-time
award of 34,852 restricted stock units as compensation for his service as a consultant, which restricted stock units will vest in full and become payable on May 22, 2020, subject to continued service through the vesting date.
The following table sets forth summary information concerning compensation for thenon-employee
members of our Board in 2019. Mr. Fuller’s compensation for his service as anon-employee
director prior to and following his term as our Interim Chief Executive Officer is included under “Compensation Tables–2019 Summary Compensation Table.” Mr. Livek and Mr. Wiener did not receive any compensation for their service as directors in 2019. We
reimbursereimbursed all of our
non-employee directors for
all reasonable
out-of-pocket
expenses incurred in the performance of their duties as directors. Such expense reimbursements are not included as a component of compensation
disclosed in the
2014 Director Compensation Table.table below.
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
| | | | | | | | (3) | | | | | | | | |
| | | | | | | | (5) | | | | | | | | |
| | | | | | | | (6) | | | | | | | | |
| | | | | | | | (8) | | | | | | | | |
| | | | | | | | (10) | | | | | | | | |
| | | | | | | | (12) | | | | | | | | |
| | | | | | | | (14) | | | | | | | | |
| | | | | | | | (16) | | | | | | | | |
| | | | | | | | (17) | | | | | | | | |
2014 Director Compensation Table
The following table sets forth certain information concerning cash and non-cash compensation earned by our non-employee directors in 2014. None of the non-employee directors received option awards or other compensation in 2014.
|
| | | |
| Name | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(2)(3) | Total ($) |
| Russell Fradin | 15,833 | 125,018 | 140,851 |
| Jeffrey Ganek(4) | 40,000 | 125,018 | 165,018 |
| William J. Henderson | 55,000 | 125,018 | 180,018 |
| William Katz | 42,500 | 125,018 | 167,518 |
| Ronald J. Korn | 48,000 | 125,018 | 173,018 |
| Jarl Mohn(5) | 22,084 | - | 22,084 |
| |
| (1) | Effective October 2014, the Board amended our director compensation policy to include an annual cash retainer to the lead independent director. The amounts reportedAmounts reflected in this table reflect that amendment |
| |
(2) | Representscolumn represent the aggregate grant date fair value of $37.23 per sharestock awards computed in accordance with FASB ASC Topic 718 of the stock awards granted to the non-employees in 2014. The assumptions718. Assumptions used in the calculation of these award amounts are includeddescribed in Note 115 to the consolidated financial statements included in our Annual Report on Form10-K for the fiscal year ended December 31, 2014. Each director elected at the company's 2014 annual meeting received a retainer consisting2019. The amounts reported in this column for Ms. McKenna and Mr. Norman also include incremental fair value related to modifications of restricted stock units valued at approximately $125,018, equal to 3,358 shares valued at $37.23 per shareunit awards in accordance with FASB ASC Topic 718.2019, as discussed above. |
| (2) | Ms. Bradford joined the Board on April 1, 2019. |
| (3) | AtAmount reflects (a) a restricted stock unit grant for the 2018-2019 term (prorated at grant based on service inception date) with a grant date fair value of $62,504, awarded May 22, 2019, and (b) a restricted stock unit grant for the 2019-2020 term with a grant date fair value of $129,954, awarded July 1, 2019. As of December 31, 2014, the aggregate number of stock options exercisable and outstanding for our non-employee directors was 4,000, and the aggregate number of2019, Ms. Bradford held unvested restricted stock units unvested was 16,790.with respect to 24,155 shares of our Common Stock. |
(4) Mr. Ganek resigned effective January 15, 2015.
(5) Mr. Mohn did not stand for reelection at the end of his term in July 2014.
The number of shares of our common stock and the grant date fair value of each stock award reported in the “Stock Awards” column above are as follows:
|
| | | | |
| Name | Award Type | Grant Date | Number of Shares | Grant Date Fair Value ($) |
| Russell Fradin | Restricted Stock Units | July 22, 2014 | 3,358 | 125,018 |
| Jeffrey Ganek(1) | Restricted Stock Units | July 22, 2014 | 3,358 | 125,018 |
| William J. Henderson | Restricted Stock Units | July 22, 2014 | 3,358 | 125,018 |
| William Katz | Restricted Stock Units | July 22, 2014 | 3,358 | 125,018 |
| Ronald J. Korn | Restricted Stock Units | July 22, 2014 | 3,358 | 125,018 |
| Jarl Mohn(2) | Restricted Stock Units | July 22, 2014 | 3,358 | 125,018 |
| |
(1)(4) | Mr. Ganek resigned effective January 15, 2015.Gotlieb joined the Board on April 1, 2019. |
| (5) | Amount reflects a special restricted stock unit grant with a grant date fair value of $899,995, awarded May 22, 2019. As of December 31, 2019, Mr. Gotlieb held unvested restricted stock units with respect to 86,956 shares of our Common Stock. |
(2)(6) | Amount reflects a restricted stock unit grant for the 2019-2020 term with a grant date fair value of $129,954, awarded July 1, 2019. As of December 31, 2019, Mr. Kerrest held unvested restricted stock units with respect to 24,155 shares of our Common Stock. |
| (7) | Ms. Love joined the Board on April 1, 2019. |
| (8) | Amount reflects (a) a restricted stock unit grant for the 2018-2019 term (prorated at grant based on service inception date) with a grant date fair value of $62,504, awarded May 22, 2019, and (b) a restricted stock unit grant for the 2019-2020 term with a grant date fair value of $129,954, awarded July 1, 2019. As of December 31, 2019, Ms. Love held unvested restricted stock units with respect to 24,155 shares of our Common Stock. |
| (9) | Mr. MohnMartin joined the Board on May 22, 2019. |
| (10) | Amount reflects (a) a special restricted stock unit grant for service as Finance Committee chairman with a grant date fair value of $100,002, awarded May 23, 2019, and (b) a restricted stock unit grant for the 2019-2020 term with a grant date fair value of $129,954, awarded July 1, 2019. As of December 31, 2019, Mr. Martin held unvested restricted stock units with respect to 33,817 shares of our Common Stock. |
| (11) | Ms. McKenna left the Board on March 7, 2019. |
| (12) | Amount reflects the incremental fair value related to an acceleration of Ms. McKenna’s outstanding restricted stock units on March 7, 2019. As of December 31, 2019, Ms. McKenna did not stand for reelection at the end of his term in July 2014.hold any outstanding awards with respect to our Common Stock. |
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
William J. Henderson, William Katz and Jarl Mohn served as our Compensation Committee from January 2014 through July 2014, at which time Russell Fradin replaced Mr. Mohn. Mr. Fradin served as our Executive Vice President, Corporate Development from June 2000 to June 2004. Mr. Fulgoni, our Chairman Emeritus,
| (13) | Mr. Norman left the Board and transitioned to the role of a strategic consultant on May 22, 2019. |
| (14) | Amount reflects (a) incremental fair value of $117,887 related to a modification of Mr. Norman’s outstanding restricted stock units on May 22, 2019, and (b) a restricted stock unit grant for Mr. Norman’s service as a consultant with a grant date fair value of $187,504, awarded July 1, 2019. As of December 31, 2019, Mr. Norman held unvested restricted stock units with respect to 34,852 shares of our Common Stock. |
| (15) | Mr. Reilly left the Board on August 12, 2019. |
| (16) | Amount reflects a restricted stock unit grant for the 2019-2020 term with a grant date fair value of $129,954, awarded July 1, 2019. This award was forfeited when Mr. Reilly left the Board. As of December 31, 2019, Mr. Reilly did not hold any outstanding awards with respect to our Common Stock. |
| (17) | Amount reflects a restricted stock unit grant for the 2019-2020 term with a grant date fair value of $129,954, awarded July 1, 2019. As of December 31, 2019, Mr. Rosenthal held unvested restricted stock units with respect to 24,155 shares of our Common Stock and exercisable options with respect to 86,974 shares of our Common Stock. |
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTTERS| ITEM 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS |
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information with respect to beneficial ownership of our common stock,Common Stock as of April 1, 2015,10, 2020, by:
each beneficial owner of 5% or more of the outstanding shares of our common stock;Common Stock;
each of our current directors;
each of our named executive officers;officers for 2019; and
all of our current directors and executive officers and directors as a group.
Beneficial ownership is determined in accordance with the rules of the SEC. Except as indicated by the footnotes below, we believe, based on the information furnished to us, that the persons and entities named in the table below have sole voting and investment power with respect to all shares of the common stockCommon Stock that they beneficially own, subject to applicable community property laws. In computing the number of shares beneficially owned by a person and the percentage ownership of that person, shares of common stockCommon Stock subject to options or warrantsother rights held by that person that are currently exercisable or exercisable within 60 days of April 1, 201510, 2020 are deemed outstanding, but are not deemed outstanding for purposes of computing the percentage ownership of any other person. Unless otherwise indicated, these shares do not include any stock or options awarded after April 1, 2015.10, 2020. A total of 40,513,19170,206,917 shares of our common stockCommon Stock were outstanding as of April 1, 2015.10, 2020. Except as otherwise indicated, the address of each of the personsperson in this table is c/o comScore, Inc.,Comscore, 11950 Democracy Drive, Suite 600, Reston, Virginia 20190.
| | | | | | | | | |
Name and Address of Beneficial Owner | | | | | | |
5% or Greater Stockholders: | | | | | | | | |
WPP plc and affiliated entities (2) | | | | | | | | % |
PRIMECAP Management Company (3) | | | | | | | | % |
Tenzing Global Management LLC and affiliated entities (4) | | | | | | | | % |
| | | | | | | | | |
Directors and Named Executive Officers: | | | | | | | | |
Joanne Bradford, Director (5) | | | | | | | | |
Irwin Gotlieb, Director (6) | | | | | | | | |
Jacques Kerrest, Director (7) | | | | | | | | |
William Livek, Chief Executive Officer and Executive Vice Chairman (8) | | | | | | | | % |
Kathleen Love, Director (9) | | | | | | | | |
John Martin, Director (10) | | | | | | | | |
Brent Rosenthal, Chairman of the Board (11) | | | | | | | | |
Dale Fuller, Former Interim Chief Executive Officer (12) | | | | | | | | |
Bryan Wiener, Former Chief Executive Officer | | | | | | | | |
Gregory Fink, Chief Financial Officer and Treasurer (13) | | | | | | | | |
Carol DiBattiste, Chief Legal and Compliance Officer (14) | | | | | | | | |
Christopher Wilson, Chief Commercial Officer (15) | | | | | | | | |
Sarah Hofstetter, Former President | | | | | | | | |
Kathryn Bachmann, Former Chief Operating Officer | | | | | | | | |
All current directors and executive officers as a group (10 persons) (16) | | | | | | | | % |
|
| | | | |
| Name and Address of Beneficial Owner | Amount and Nature of Beneficial Ownership(1) | Percentage of Common Stock Outstanding |
| 5% or Greater Stockholders: | | |
| WPP plc and affiliated entities(2) | 6,076,978 |
| 15.0 | % |
| PRIMECAP Management Company(3) | 4,150,532 |
| 12.1 | % |
| Blackrock, Inc.(4) | 3,426,390 |
| 10.0 | % |
| The Vanguard Group(5) | 2,303,291 |
| 6.7 | % |
Directors and Named Executive Officers: | | |
| Serge Matta(6) | 820,534 |
| 2.0 | % |
| Magid M. Abraham, Ph.D.(7) | 166,986 |
| * |
|
| Gian M. Fulgoni(8) | 167,790 |
| * |
|
| Melvin Wesley III(9) | 168,033 |
| * |
|
| Cameron Meierhoefer(10) | 222,504 |
| * |
|
| Christiana Lin(11) | 239,467 |
| * |
|
| Russell Fradin | — |
| * |
|
| William J. Henderson | 24,925 |
| * |
|
| William Katz | 25,517 |
| * |
|
| Ronald J. Korn(12) | 41,748 |
| * |
|
| Joan M. Lewis | — |
| * |
|
| All directors and executive officers as a group (twelve persons)(13) | 1,986,558 |
| 4.9 | % |
| |
| * | Represents less than 1% of the outstanding shares of common stock.Common Stock. |
| |
| (1) | The information provided in this table is based on ourcompany records, information supplied to us by our directors, executive officers, directorsformer executive officers and principal stockholders and information contained in Schedules 13D and 13G and Forms 4 filed with the SEC. |
| |
| (2) | This information is derived solely from the Schedule 13D13D/A filed with the SEC on April 7, 2015. Each of WPP plc and6, 2018. Shares are owned directly by Cavendish Square Holding B.V. (“Cavendish”), which is a wholly-owned subsidiary of WPP plc have shared voting power and shared dispositive powerthat WPP plc owns indirectly through a series of 6,076,978 shares.holding companies. WPP plc is an indirect beneficial owner of the reported securities. The address for WPP plc is 27 Farm Street, London, unitedUnited Kingdom W1J 5RJ. The address for Cavendish Square Holding B.V. is Laan op Zuid 167, 3072 DB Rotterdam, Netherlands. |
| |
| (3) | This information is derived solely from the Schedule 13G/A filed with the SEC on February 13, 2015.12, 2020. PRIMECAP Management Company has sole voting power of 3,470,360 shares and sole dispositive power of 4,150,532for 7,870,285 shares. The address for PRIMECAP Management Company is 225 south Lake Ave.177 E. Colorado Blvd., #400,11th Floor, Pasadena, CA 91101. .91105. |
| |
| (4) | This information is derived solely from the Schedule 13G/A13D filed with the SEC on February 10, 2015. Blackrock, Inc.March 13, 2020. Tenzing Global Management LLC has soleshared voting and dispositive power of 3,351,333for 3,950,000 shares, Tenzing Global Investors LLC has shared voting and dispositive power for 2,878,315 shares, Tenzing Global Investors Fund I LP (“Fund I”) has shared voting and dispositive power for 2,878,315 shares, and soleChet Kapoor has shared voting and dispositive power for 3,950,000 shares. Shares are held directly and beneficially by Fund I, for which Tenzing Global Management, LLC is the investment adviser and Tenzing Global Investors LLC is the general partner, and Chet Kapoor serves as Managing Partner and CIO of 3,426,390 shares.each of Tenzing Global Investors LLC and Tenzing Global Management, LLC and the Managing Partner and CIO of Fund I. The address for Blackrock, Inc.each of the Tenzing entities and Mr. Kapoor is 55 East 52nd90 New Montgomery Street, New York, NY 10022.Suite 650, San Francisco, California 94105. |
| |
| (5) | This information is derived solelyRepresents 6,039 shares subject to vested restricted stock units that are scheduled to be delivered on the earlier of Ms. Bradford’s separation from service or a change in control of the Schedule 13G/A filed with the SEC on February 11, 2015. The Vanguard Group has sole voting power of 46,879 shares, sole dispositive power of 2,259,712, and shared dispositive power of 43,579 shares. The address for the Vanguard Group is 100 Vanguard Blvd., Malvern, PA 19355.company. |
| |
| (6) | Represents 86,956 shares subject to vested restricted stock units that are scheduled to be delivered on the earlier of Mr. Gotlieb’s separation from service or a change in control of the company. |
| (7) | Includes 743,46811,390 shares subject to vested restricted stock units that are scheduled to be delivered on the earlier of Mr. Kerrest’s separation from service or a change in control of the company. |
| (8) | Includes 286,350 shares subject to options that are immediately exercisablecurrently exercisable. |
| (9) | Represents 6,039 shares subject to vested restricted stock units that are scheduled to be delivered on the earlier of Ms. Love’s separation from service or exercisablea change in control of the company. |
| (10) | Represents 9,662 shares subject to restricted stock units that are scheduled to vest within 60 days of April 1, 2015. Additionally, includes 8,750 shares subject10, 2020 and to be delivered on the earlier of Mr. Martin’s separation from service or a rightchange in control of repurchase held by us pursuant to a restricted stock agreement.the company. |
| |
(7)(11) | Includes 33,947 shares held indirectly by spouse of which 6,250 shares are subject to a right of repurchase held by us pursuant to a restricted stock agreement. |
| |
(8) | Includes 8,750 shares subject to a right of repurchase held by us pursuant to a restricted stock agreement. |
| |
(9) | Includes 166,30986,974 shares subject to options that are immediatelycurrently exercisable and 11,390 shares subject to vested restricted stock units that are scheduled to be delivered on the earlier of Mr. Rosenthal’s separation from service or exercisablea change in control of the company. |
| (12) | Excludes 354,546 shares subject to deferred stock units that are not scheduled to be delivered within 60 days of April 1, 2015.10, 2020. |
(10) Includes 166,309 shares subject to options that are immediately exercisable or exercisable within 60 days of April 1, 2015. Additionally, includes 6,250
shares subject to a right of repurchase held by us pursuant to a restricted stock agreement.
| (13) | Includes 8,251 shares subject to vested restricted stock units that are scheduled to be delivered between May 1, 2020 and December 31, 2020 and 1,376 shares subject to restricted stock units that are scheduled to vest within 60 days of April 10, 2020. |
(11) Includes 166,309 shares subject to options that are immediately exercisable or exercisable within 60 days of April 1, 2015. Additionally, includes 6,250
| (14) | Includes 33,645 shares subject to vested restricted stock units that are scheduled to be delivered between May 1, 2020 and December 31, 2020. |
shares subject to a right of repurchase held by us pursuant to a restricted stock agreement.
| (15) | Includes 46,000 shares subject to options that are currently exercisable, 37,500 shares subject to options that are scheduled to vest within 60 days of April 10, 2020, and 13,751 shares subject to vested restricted stock units that are scheduled to be delivered between May 1, 2020 and December 31, 2020. |
(12) Includes 4,000 shares subject to options that are immediately exercisable or exercisable within 60 days of April 1, 2015.
| (16) | Includes 419,324 shares subject to options that are currently exercisable, 37,500 shares subject to options that are scheduled to vest within 60 days of April 10, 2020, 177,461 shares subject to vested restricted stock units that are scheduled to be delivered as described above, and 11,038 shares subject to restricted stock units that are scheduled to vest within 60 days of April 10, 2020. |
(13) Includes 1,322,809 shares subject to options that are immediately exercisable or exercisable within 60 days of April 1, 2015. Includes 41,250 shares
subject to a right of repurchase held by us pursuant to restricted stock agreements.Equity Compensation Plan Information
EQUITY COMPENSATION PLANS
The following table summarizes our equity compensation plans as of December 31, 2014:2019:
| | | | | | | | | | | | | |
| | Number of Securities to be Warrants and Rights (a) (1) | | | Weighted-Average Exercise | | | Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation
Plans (Excluding
Securities Reflected in
Column (a)) (c) (3) | |
Equity compensation plans approved by security holders | | | | | | $ | | | | | | |
Equity compensation plans not approved by security holders | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | | | | $ | | | | | | |
| | | | | | | | | | | | | |
|
| | | | | | | |
| Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights
(a) | Weighted Average Exercise Price of Outstanding Options, Warrants and Rights
(b) | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a))
(c) |
| Equity compensation plans approved by security holders | 3,390,889 |
| $ | 5.34 |
| 1,563,114(1) |
|
| Equity compensation plans not approved by security holders | — |
| — |
| — |
|
| Total | 3,390,889 |
| $ | 5.34 |
| 1,563,114(1) |
|
| |
| (1) | Our 2007 Equity Incentive Plan provides for annual increases inThis column reflects (i) all shares subject to time-based restricted stock units and deferred stock units that were outstanding as of December 31, 2019, (ii) the maximum number of shares subject to performance-based restricted stock units that were outstanding as of December 31, 2019, and (iii) all shares subject to outstanding stock options as of December 31, 2019. If actual performance under the performance-based restricted stock units falls below the maximum level for these awards, fewer shares would be issued. |
| (2) | The weighted average exercise price reflected in this column is calculated based solely on the exercise prices of outstanding options and does not take into account time-based restricted stock units, deferred stock units or performance-based restricted stock units, which do not have an exercise price. |
| (3) | This column reflects the total number of shares remaining available for issuance thereunder onunder our 2018 Equity and Incentive Compensation Plan as of December 31, 2019, assuming the first daymaximum number of each fiscal year, beginning with our 2008 fiscal year, equalshares subject to outstanding performance-based restricted stock units is no longer available for issuance. If actual performance under these performance-based restricted stock units falls below the least of: (i) 4%maximum level for these awards, a greater number of shares would be available for issuance under the outstanding shares of our common stock on the last day of the immediately preceding fiscal year; (ii) 1,800,000 shares; or (iii) such other amount as our Board of Directors may determine.plan. |
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCETable of Contents| ITEM 13. | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE |
Policies and Procedures for Transactions with Related PersonsParties
Related personVarious Comscore policies and procedures, including our Code of Business Conduct and Ethics and annual questionnaires completed by all of our directors and executive officers, require disclosure of transactions or relationships that may constitute conflicts of interest or otherwise require disclosure under applicable SEC rules. In addition, our Board has adopted a written policy and procedures for the review and approval of transactions in which we define as all transactions involving anthe company is a participant, the amount involved exceeds $120,000, and one of our directors, executive officer, director, nominee for directorofficers, or a holder of more than five percent5% of our common stock,Common Stock, including any of their immediate family members and any entity owned or controlled by such persons are reviewed and approved by the audit committee of(collectively, “related parties”), has or will have a direct or indirect material interest.
If any related party proposes to enter into any such transaction (a “related party transaction”), our Board of Directors or in some cases by a majority of disinterested directors on our Board of Directors.
In any transaction involving a related person, our audit committee and our Board of DirectorsAudit Committee will consider all of the available material facts and circumstances of the transaction, including: the direct and indirect interests of the related persons;party; the approximate dollar value of the amount involved in the transaction and the dollar value of such related person’s direct or indirect interest in the transaction; whether the transaction was undertaken in the ordinary course of business of the company; whether the transaction is proposed to be entered into on terms no less favorable to the company than those reached with an unrelated third party; whether any alternative transactions or sources for comparable services or products are available; the purpose of the transaction and potential benefits, or potential risks or costs, to the company; whether the transaction is in the best interests of the company; any required public disclosure of the transaction; whether the transaction presents an improper conflict of interest for any company officer or director; in the event the related personparty is a director or nominee for director (or immediate family member of a director or nominee or an entity with which a director or nominee is affiliated), the impact that the transaction will have on that director’s or nominee for director’snominee’s independence; and any other information regarding the risks, costs and benefitstransaction that would be material to investors in light of the transaction to us;circumstances of such transaction.
Following such consideration and whether any alternative transactions or sources for comparable services or products are available.
After considering all such facts and circumstances, our audit committee and our Board of Directors determine whether approval or ratificationreview, if deemed appropriate, the disinterested members of the Audit Committee will approve the related personparty transaction (except that, if the transaction is in our best interests. For example, if our audit committee determinesproposed to be, or was, entered into on terms less favorable to the company than terms that the proposed terms of a related person transaction are reasonable and at least as favorable as could have been obtained fromreached with an unrelated third parties, itparty, approval will recommend to our Boardbe obtained by unanimous approval of Directors that suchthe disinterested members of the Board). A related party transaction will not be approved or ratified. In addition, if a related person transaction will compromise the independence of one of our directors or nominees for director, our audit committee may recommend that our Board of Directors reject the transaction if it could affectwould render a director no longer independent and would cause less than a majority of the Board to meet our abilitydirector independence requirements. Whenever practicable, the reporting, review and approval will occur prior to complyentry into the related party transaction. If advance review is not practicable, our Audit Committee may ratify the related party transaction.
Transactions with securities lawsRelated Parties
Other than compensation disclosed under “Director Compensation” or “Executive Compensation” in this filing and regulations or NASDAQ listing requirements.
Of the transactions described below, the employment arrangement with Ms. Abraham and several of the indemnification agreementswe believe there were entered into prior to the adoption of our audit committee charter. Accordingly, each of thoseno other related party transactions were approved by disinterested members of our Board of Directors after making a determination that the transaction was executed on terms no less favorable than those we could have obtained from unrelated third parties.
The policies and procedures described above for reviewing and approving related person transactions are not in writing. However, the charter for our audit committee provides that one of the committee’s responsibilities is to review and approve in advance any proposed related person transactions.
Transactions and Relationships with Directors, Officers and Five Percent Stockholders
We believe that there has not been any other transaction or series of transactions(as defined above) during 2014 to which we were or are to be a participant in which the amount involved exceeds $120,000 and in which any director, nominee for director, executive officer or holder of more than five percent of our common stock, or members of any such person’s immediate family, had or will have a direct or indirect material interest, other than compensation described in “Executive Compensation” or “Director Compensation” elsewhere in this Amendment No. 1 to Annual Report on Form 10-K/A and as described below.
Linda Boland Abraham
Since our inception in 1999, Linda Boland Abraham, the spouse of Dr. Magid M. Abraham, our Executive Chairman of our Board of Director and former Chief Executive Officer, has been employed in various management positions with us. Most recently, Ms. Abraham has served as our Executive Vice President, Global Development. During the year ended December 31, 2014, Ms. Abraham received an award2019.
As of sharesApril 10, 2020, based on public filings, WPP plc (“WPP”) and its affiliates owned approximately 16.1% of our restricted stock
pursuant to our 2013 Bonus Policy with a fair value atoutstanding Common Stock. In the time of grant of $107,920 that was granted in February 2014, with 50% vested immediately and the remaining 50% to vest equally in February 2015 and 2016. During the year ended December 31, 2014, Ms. Abraham did not receive a cash salary. Similar to Dr. Abraham, Ms. Abraham agreed to receive stock in lieu of cash salary for the entire 2014 fiscal year. The stock for the entire calendar year was was issued on December 31, 2014. The 2014 annual salary for Ms. Abraham was $62,030. Based on the closing price of our common stock as reported on the NASDAQ Global Select Market on December 31, 2014, we awarded 1,336 shares of common stock to Ms. Abraham in lieu of salary per this arrangement.
Commercial Agreements
During 2014, The Proctor & Gamble Company purchased $3.1 million in services from the Company. Ms. Lewis, a member of our Board of Directors, was an executive officer of The Proctor & Gamble Company until her retirement from that position in December, 2014. Ms. Lewis did not have direct authority over The Proctor & Gamble Company contracts with the Company, nor did she receive direct material benefit from any such transactions. The sales were made in the ordinarynormal course of business, pursuantwe provide WPP and its affiliates with services amongst our different product lines and receive services from WPP and its affiliates supporting our data collection efforts. In 2019, our transactions with WPP and its affiliates resulted in approximately $15.9 million of revenue and $11.0 million of expense.
Irwin Gotlieb, who was appointed to our standard terms and conditions.Board in April 2019, serves as a senior advisor to WPP.
Transactions with Fidelity
We have entered into an indemnification agreement with eachDuring 2019, based on public filings, FMR LLC (an affiliate of Fidelity Management & Research Company) owned more than 5% of our directors and executive officers. The indemnification agreements and our amended and restated certificate of incorporation and bylaws require us to indemnify our directors and officers tooutstanding Common Stock. In the fullest extent permitted by Delaware law.
DIRECTOR INDEPENDENCE
Our Board of Directors has determined that each of Messrs. Fradin, Henderson, Katz and Korn and Ms. Lewis is independent under the rules of the SEC and the listing standards of the NASDAQ Stock Market. Our Board of Directors also determined that each of Messrs. Ganek and Mohn was independent under the rules of the SEC and the listing standards of the NASDAQ Stock Market during their service as a director in 2014. Therefore, every member of the audit committee, Compensation Committee and nominating and governance committee during 2014 was and currently is an independent director in accordance with those standards. In determining the independence of our directors, our Board of Director considered all transactions in which we and any director had any interest, including those involving payments made by us to companies in the ordinarynormal course of business, where Messrs. Fradin, Henderson,we provide Fidelity and Mohnits affiliates with services amongst our different product lines and Ms. Lewis serve onreceive stock and benefits processing and administration services from Fidelity. In 2019, our Boardtransactions with Fidelity and its affiliates resulted in approximately $0.9 million of Director orrevenue and $0.1 million of expense. On February 7, 2020, Fidelity filed a Schedule 13G/A indicating that it no longer owns more than 5% of our outstanding Common Stock.
Frederic Kerrest, the son of Jacques Kerrest, serves as Chief Operating Officer of OKTA, Inc., which is a memberservice provider to the company. In 2019, we recognized expense of approximately $0.1 million from transactions with OKTA in the normal course of business.
Compensation ofNon-Executive
Employees William Livek’s son is anon-executive
account director of the
executive management teamcompany and has been employed by the company since January 2016. During 2019, he received salary and incentive compensation of approximately $108,000, in addition to the standard benefits that he receives as an employee of the
othercompany. Kathleen Love’s son is anon-executive
sales manager of the company
and has been employed by the company since May 2017. During 2019, he received salary and incentive compensation of approximately $173,000, in addition to the standard benefits that he receives as an employee of the company. ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Audit
| ITEM 14. | PRINCIPAL ACCOUNTING FEES AND SERVICES |
Fees and Related Fees for Fiscal Years 2013 and 2014Services
The following table sets forth a summary of the fees billed to us by
ErnstDeloitte &
YoungTouche LLP
(“Deloitte”) for professional services for the fiscal years ended
December 31, 20132019 and
2014, respectively. 2018. Audit-related fees were for services in connection with foreign statutory audits, access to Deloitte’s accounting research tool, and our registration statements on FormS-1
and FormS-8
(2018 only). Tax fees were principally for tax consulting services.All of the services described in the following fee tabletables above were approved by the audit committee.
|
| | | | | | |
| Name | 2013 |
| 2014 |
|
| Audit Fees(1) | $ | 1,768,500 |
| $ | 1,926,235 |
|
| Audit-Related Fees | - |
| - |
|
| Tax Fees | - |
| - |
|
| All Other Fees | - |
| - |
|
| Total Fees | $ | 1,768,500 |
| $ | 1,926,235 |
|
| |
(1) | Audit fees represent fees for professional services relating to the audit of our financial statements included in our annual reports on Form 10-K and our registration statements on Forms S-3 and S-8, the audit of internal control over financial reporting required by Section 404 of the Sarbanes-Oxley Act of 2002 and the review of the financial statements included in our quarterly reports on Form 10-Q. |
Audit Committee. The
audit committeeAudit Committee meets regularly with
Ernst & Young LLP throughout the
yearindependent auditor and reviews both audit and
non-audit
services performed by
Ernst & Young LLPDeloitte as well as fees charged for such services. The
audit committeeAudit Committee has determined that the provision of the services described above is compatible with maintaining
Ernst & Young LLP’sDeloitte’s independence in the conduct of its audit functions.
Pre-Approval
Policies and Procedures
Our
audit committeeAudit Committee has adopted, and our Board
of Directors has approved,
a policy that sets forth the procedures and
the conditions pursuant to which services proposed to be performed by
our independent auditors should bepre-approved.
Such procedures and conditions are set forth in the
independent auditor may be pre-approved. PursuantAudit Committee’s charter. The Audit Committee has delegatedpre-approval
authority to its
chairman for certain services other than the annual audit
audit-related and
non-audit services pre-approval policy, our audit committee may delegate either type of pre-approval authority to one or more of its members.quarterly reviews performed by Deloitte. The
member to whom such authority is delegatedchairman must report
for informational purposes only, any
pre-approval
decisions to the
audit committeeAudit Committee at its next scheduled meeting.
Our audit committee The Audit Committeepre-approved
all audit,
relatedaudit-related and other services rendered by
Ernst & Young LLPDeloitte in
2013its capacity as our independent auditor for 2019 and
2014.2018.
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
| ITEM 15. | EXHIBITS, FINANCIAL STATEMENT SCHEDULES |
(a)
(1) and (a)(2): No financial statements or schedules The following documents are filed
withas part of the Original10-K:
(1) Financial statements and reports of our independent registered public accounting firm. See (i) Index to Consolidated Financial Statements at Item 8 and (ii) Item 9A of the Original10-K.
(2) All other schedules, for which provision is made in the applicable accounting regulations of the SEC, are omitted, as the required information is inapplicable or the information is presented in the Consolidated Financial Statements and Notes to Consolidated Financial Statements in Item 8 of the Original10-K.
(3) Exhibits. The exhibits listed under Item 15(b) of the Original10-K.
(b) The Exhibits listed in the Exhibit Index of this Amendment No. 1 to Annual Report on Form 10-K/A.are being filed as part of this Amendment.
(a)(3) Exhibits:
|
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| | Exhibit
Document
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3.1(1) | | | |
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3.2(1) | | |
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4.1(1) | | Specimen Common Stock Certificate (Exhibit 4.1) |
| | | | |
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10.1(1) | | |
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10.2(2) | | 1999 |
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10.3(1) | | |
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10.4(1) | | |
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10.5(1) | | |
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10.6(3) | | 2007 Equity Incentive Plan, as amended and restated June 8, 2011 (Exhibit 10.1) |
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10.7(1) | | |
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10.8(1) | | |
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10.9(1) | | |
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10.10(4) | | |
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10.11(5)* | | Transition Agreement, |
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10.12(3) | | |
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10.13(6) | | Credit Agreement among comScore, Inc., the subsidiaries of comScore, Inc. identified therein, Bank of America, N.A., Suntrust Bank, and the other lenders party thereto, datedRegistrant’s Current Report on Form 8-K, filed on September 26, 2013 (Exhibit 10.1) |
| |
10.14(6) | | Security and Pledge Agreement among comScore, Inc., the subsidiaries of comScore, Inc. party thereto and Bank of America, N.A., dated September 26, 2013 (Exhibit 10.2)10, 2018) (File No. 001-33520)
|
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10.15(7) | | Patent Purchase, License |
| | | | |
| | |
10.16(7) | | Purchase |
| | | | |
| | |
10.17(7) | | Voting |
| | | | |
| | |
10.18(8) | | Summary |
| | | | |
| | |
10.19(9) | | Summary |
| | | | |
| | |
10.20(10) | | Summary |
| | | | |
|
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10.21(11) | | Summary of 2015 Named Executive Officer Incentive Plan |
| | | | |
| | |
10.22(12) | | Summary of Revised Compensatory Arrangements for |
| | | | |
| | |
10.23 | | Employment Offer Letter |
| | | | |
| | |
10.24(13) | | Summary |
| | | | |
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10.25(14) | | |
| | | | |
| | |
10.26(14) | | Stockholders Rights |
| | | | |
| | |
10.27(14) | | Voting |
| | | | |
| | |
10.28(14) | | Strategic Alliance |
| | | | |
| | |
10.29(15) | | Purchase Agreement |
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21.1** | | List |
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| | |
23.1** | | Consent of Ernst & Young |
| | |
24.1** | | Power of Attorney (see signature page) |
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31.1 | | |
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31.2 | | |
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32.1** | | |
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32.2** | | |
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101.1** | | XBRL Instance Document+ |
101.2** | | |
| | | | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document |
| | | | |
| | | | XBRL Taxonomy Extension Schema Document+Document |
101.3** | | | | |
| | | | XBRL Taxonomy Extension Calculation Linkbase Document+Document |
101.4** | | | | |
| | | | |
| | | | XBRL Taxonomy Extension Definition Linkbase Document+Document |
101.5** | | | | |
| | | | XBRL Taxonomy Extension Label Linkbase Document+Document |
101.6** | | | | |
| | | | XBRL Taxonomy Extension Presentation Linkbase Document+Document |
| | | | |
| | | | Cover Page Interactive Data File - the cover page iXBRL tags are embedded within the Inline XBRL document |
* Confidential treatment has been requested for a portion of this exhibit.
** Previously filed or furnished with the Registrant’s Annual Report on Form 10-K, filed February 18, 2013.
+ XBRL (Extensible Business Reporting Language) information is furnished and not filed herewith, is not a part of a registration statement or Prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.
| * | Management contract or compensatory plan or arrangement |
(1) Incorporated by reference to the exhibits to the Registrant’s Registration Statement on Form S-1, as amended, dated June 26, 2007 (No. 333-141740). The number given in parentheses indicates the corresponding exhibit number in such Form S-1.
(2) Incorporated by reference to the exhibits to the Registrant’s Registration Statement on Form S-8, as amended, filed July 2, 2007 (No. 333-144281). The number given in parentheses indicates the corresponding exhibit number in such Form S-8.
(3) Incorporated by reference to the exhibits to the Registrant’s Quarterly Report on Form 10-Q, filed October 29, 2014 (File No. 001-33520). The number given in parentheses indicates the corresponding exhibit number in such Form 10-Q.
(4) Incorporated by reference to the exhibits to the Registrant’s Current Report on Form 8-K, filed February 5, 2008 (File No. 001-33520). The number given in parentheses indicates the corresponding exhibit number in such Form 8-K.
(5) Incorporated by reference to the exhibit to the Registrant's Quarterly Report on Form 10-Q, filed August 5, 2014 (File No. 001-33520). The number given in parentheses indicates the corresponding exhibit number in such Form 10-Q.
(6) Incorporated by reference to the exhibits to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2013, filed October 29, 2013 (File No. 001-33520). The number given in parentheses indicates the corresponding exhibit number in such Form 10-Q.
(7) Incorporated by reference to the exhibit to the Registrant’s Current Report on Form 8-K, filed December 21, 2011 (File No. 001-33520). The number given in parentheses indicates the corresponding exhibit number in such Form 8-K.
(8) Incorporated by reference to the Registrant’s Current Report on Form 8-K, filed April 4, 2012 (File No. 001-33520).
(9) Incorporated by reference to the Registrant’s Current Report on Form 8-K, filed June 21, 2013 (File No. 001-33520).
(10) Incorporated by reference to the Registrant’s Amendment No. 1 to the Annual Report on Form 10-K/A, filed April 29, 2014 (File No. 001-33520).
(11) Incorporated by reference to the Registrant’s Current Report on Form 8-K, filed February 17, 2015 (File No. 001-33520).
(12) Incorporated by reference to the Registrant’s Current Report on Form 8-K, filed March 5, 2014 (File No. 001-33520).
(13) Incorporated by reference to the Registrant’s Current Report on Form 8-K, filed November 12, 2014 (File No. 001-33520).
(14) Incorporated by reference to the exhibits to the Tender Offer Statement on Form TO for the Company’s common stock, filed February 20, 2015 (File No. 005-83687). The number given in parentheses indicates the corresponding exhibit number in such Form TO.
Incorporated by reference to the exhibit to the Registrant’s Current Report on Form 8-K, filed April 3, 2015 (File No. 001-33520). The number given in parentheses indicates the corresponding exhibit number in such Form 8-K.
(15) Incorporated by reference to the exhibit to the Registrant’s Current Report on Form 8-K, filed April 3, 2015 (File No. 001-33520). The number given in parentheses indicates the corresponding exhibit number in such Form 8-K.
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
comScore, Inc.
By: /s/ Serge Matta
Serge Matta
President and Chief Executive Officer
April 24, 2015
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
|
| | |
Signature | Title | Date |
/s/ Serge Matta | President, Chief Executive Officer (Principal Executive Officer) and Director | April 24, 2015 |
Serge Matta |
/s/ Melvin Wesley III | Chief Financial Officer (Principal Financial and Accounting Officer) | April 24, 2015 |
Melvin Wesley III |
* | Executive Chairman of the Board of Directors | |
Magid M. Abraham, Ph.D. |
* | Chairman Emeritus | |
Gian M. Fulgoni | |
* | Director | |
Russell Fradin | |
* | Director | |
William J. Henderson | |
* | Director | |
William Katz | |
* | Director | |
Ronald J. Korn | |
* | Director | |
Joan M. Lewis | |
| | | |
| | |
| | |
| | Chief Executive Officer and Executive Vice Chairman |
| | (Principal Executive Officer) |
| | |
| | |
| | |
| | Chief Financial Officer and Treasurer |
| | (Principal Financial Officer and Principal Accounting Officer) |
