Compensation Philosophy
Our executive compensation program is structured to provide compensation plans, policies, and programs that attract and retain the best talent for positions of substantial responsibility, provide incentives for such persons to perform to the best of their abilities, and to promote the success of our business. The following table identifies the main elements of our Fiscal 20222023 executive compensation program and the reasons for each:
| Base Salary | | | Provide our named executive officers compensation for their services based on their knowledge, skills, past performance, and experience | |
| Performance-based Bonuses | | | Encourage our named executive officers to achieve short-term individual and company goals that drive our growth | |
| Performance-based and Time-based Equity Awards | | | Provide long-term retention and incentives to our named executive officers that align their interests with our stockholders’ interests | |
| Welfare and Other Employee Benefits | | | Provide for our named executive officers’ health and well-being consistent with the benefits received by our other employees | |
| Change in Control and Severance Benefits | | | Provide our named executive officers with a measure of security in order to minimize any distractions related to termination of employment and/or change in control and allow our named executive officers to focus on their duties and responsibilities to maximize stockholder value | |
Impact of 20212022 Stockholder Advisory Vote on Compensation of Named Executive Officers
We conducted a Say-on-Pay vote at our 20212022 annual meeting of stockholders. Approximately 75%93% of the votes cast by stockholders were in favor of approving the compensation of our named executive officers.officers, an increase from the preceding year’s result of 75%. While evaluating our executive compensation program in fiscal year 2022,2023, our Compensation Committee considered the results and maintained the compensation philosophy and objectives and general approach to executive compensation from the prior year.
Processes and Procedures for Compensation Decisions
Our Compensation Committee is responsible for the compensation program for our executive officers and reports to our Board of Directors on its discussions, decisions and other actions.
Involvement of ManagementBase Salary
| | In fiscal year 2022,Provide our Chief Executive Officer, Chief People Officer, and certain other management team members typically attended Compensation Committee meetings and were involved in the determination ofnamed executive officers compensation for our other executives. These senior executives made recommendations to our Compensation Committee regarding short-term and long-term compensation for all executives (other than with respect to their own compensation)services based on our results, an individual executive’s contribution toward these results,their knowledge, skills, past performance, and each individual’s performance against their individual goals. Our Compensation Committee then reviewed the recommendations and other data provided by outside compensation advisors and management and made decisions as to the compensation for each executive.
| Performance-based Bonuses | | | TABLE OF CONTENTS
Use of Outside Advisors
Our Compensation Committee is authorized to retain the services of executive compensation advisors, as it sees fit, for the establishment of our compensation programs and related policies and adjustments to the compensation elements and amounts. For our fiscal year ended January 31, 2022, our Compensation Committee retained Compensia, a national compensation consulting firm, to provide it with information, recommendations, and other advice relating to executive compensation on an ongoing basis. Compensia serves at the discretion of our Compensation Committee. Among other things, our Compensation Committee engaged Compensia to assist in developing and updating a group of peer companies to help us determine the level of overall compensation for our executives and assess each separate element of compensation, with a goal of providing compensation that is competitive, fair, motivating and retentive. The Compensation Committee reviewed the independence of Compensia under New York Stock Exchange and SEC rules and concluded that the work of Compensia has not raised any conflict of interest.
Stockholder Engagement
As owners of Box, we value our stockholders’ opinions and feedback on topics of interest to our stockholders, including on our executive officer and director compensation program and environmental, social and governance matters. Maintaining an active dialogue with our stockholders is consistent with our corporate values of transparency and accountability, and we intend to continue these efforts in the future.
The feedback we receive from stockholders from our outreach program helps our Board of Directors, leadership team, and employees develop a mutual understanding and trust with our stockholders. Members of our Board of Directors and senior executives directly engage from time to time with stockholders to hear unfiltered concerns and perspectives that shape our core strategy and other decisions on matters of interest to our stockholders. As discussed below, after receiving feedback that stockholders would like to see a portion of the equity compensation forEncourage our named executive officers to be in the form of performance-based awards,achieve short-term individual and company goals that drive our growth
| | | Performance-based and Time-based Equity Awards | | | Provide long-term retention and incentives to our named executive officers that align their interests with our stockholders’ interests | | | Welfare and Other Employee Benefits | | | Provide for fiscal 2023 awards the equity grants made to Mr. Smith and Ms. Carullo were equally split between time-based awards and performance-based awards. Peer Group Compensation DataWith Compensia’s assistance, our Compensation Committee approved a group of public companies to be used when conducting a competitive market analysis of executive officer compensation. For our compensation decisions made on or before June 2021, which included our named executive officers’ equity awards approved in March 2021,health and well-being consistent with the benefits received by our compensation peer group was made up of publicly-traded companies in the software industry that generally had revenues between $290 million and $1.8 billion, a market capitalization between $850 million and $8.4 billion, a three-year compound annual growth rate (“CAGR”) below 20%, and generally were headquartered in California.
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In June 2021, our Compensation Committee re-assessed our compensation peer group based on an updated set of compensation peer group selection criteria. Using that updated criteria, our Compensation Committee approved an updated compensation peer group made up of publicly-traded companies in the software industry that generally had revenues between $300 million and $1.9 billion, a market capitalization between $1.1 billion and $10.7 billion, a three-year CAGR below 20%, and generally are headquartered in California. The two compensation peer groups used in fiscal year 2022 were:
| 8x8 Inc.
| | | | | | 8x8 Inc.
| | | Cloudera, Inc.
| | | | | | Cloudera, Inc.
| | | Cornerstone OnDemand Inc.
| | | | | | Cornerstone OnDemand Inc.
| | | | | | Added
| | | Dropbox, Inc.
| | | FireEye, Inc.
| | | | | | FireEye, Inc.
| | | Five9 Inc.
| | | | | | Five9 Inc.
| | | ForeScout Technologies, Inc.
| | | Removed
| | | | | | Guidewire Software, Inc.
| | | | | | Guidewire Software, Inc.
| | | HubSpot, Inc.
| | | Removed
| | | | | | | | | Added
| | | Medallia, Inc.
| | | Momentive Global Inc.
(formerly SVMK Inc.)
| | | | | | Momentive Global Inc.
| | | New Relic, Inc.
| | | | | | New Relic, Inc.
| | | Nutanix, Inc.
| | | | | | Nutanix, Inc.
| | | | | | Added
| | | PagerDuty, Inc.
| | | Proofpoint Inc.
| | | | | | Proofpoint Inc.
| | | Qualys, Inc.
| | | | | | Qualys, Inc.
| | | RealPage, Inc.
| | | Removed
| | | | | | SolarWinds Inc.
| | | | | | SolarWinds Inc.
| | | | | | Added
| | | Stamps.com Inc.
| | | | | | Added
| | | Verint Systems Inc.
| | | Zendesk, Inc.
| | | | | | Zendesk, Inc.
| | | Zuora, Inc.
| | | | | | Zuora, Inc.other employees
| |
| Our Compensation Committee believed these companies were appropriate for our compensation peer group because they were viewed as similarly sized, operatedChange in the same or similar industries as us, had similar growth trajectories,Control and reflected our competitive market for senior executives.Severance Benefits
| | | In setting the elements of compensation forProvide our named executive officers our Compensation Committee reviewed base salary, target annual incentive compensation opportunity, target total short-term compensation (i.e., base salary plus target incentive opportunity), annual long-term incentive,with a measure of security in order to minimize any distractions related to termination of employment and/or change in control and total direct compensation values forallow our named executive officers to focus on their duties and those of similarly situated executives of our compensation peer group. Compensia provided data at the 25th, 50th, 60th, and 75th percentiles for such compensation, and our Compensation Committee used this data as a reference. Our Compensation Committee did not benchmark any compensation elementresponsibilities to a specific percentile, and our Compensation Committee instead set our named executive officers’ compensation at levels it deemed appropriate after considering other factors, such as each of our named executive officers’ contributions, our short-term and long-term objectives, and prevailing market conditions.maximize stockholder value
| | Impact of 2022 Stockholder Advisory Vote on Compensation of Named Executive Officers We conducted a Say-on-Pay vote at our 2022 annual meeting of stockholders. Approximately 93% of the votes cast by stockholders were in favor of approving the compensation of our named executive officers, an increase from the preceding year’s result of 75%. While evaluating our executive compensation program in fiscal year 2023, our Compensation Committee considered the results and maintained the compensation philosophy and objectives and general approach to executive compensation from the prior year. Processes and Procedures for Compensation Decisions Our Compensation Committee is responsible for the compensation program for our executive officers and reports to our Board of Directors on its discussions, decisions and other actions. | | | | | | 43
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Executive Compensation Program ElementsThe following sections describe each element of our executive compensation program, provide the rationale for each such element, and explain how our Compensation Committee determined compensation amounts and awards for our fiscal year ended January 31, 2022.
Base Salary | | | Base salary is the main fixed element ofProvide our named executive officers compensation for their services based on their knowledge, skills, past performance, and experience
| | | Performance-based Bonuses | | | Encourage our named executive officers to achieve short-term individual and company goals that drive our growth | | | Performance-based and Time-based Equity Awards | | | Provide long-term retention and incentives to our named executive officers that align their interests with our stockholders’ interests | | | Welfare and Other Employee Benefits | | | Provide for our named executive officers’ short-term compensation. Base salary compensateshealth and well-being consistent with the benefits received by our other employees | | | Change in Control and Severance Benefits | | | Provide our named executive officers for services they providewith a measure of security in order to us during the fiscal year. Our Compensation Committee typically performs an annual review during which it considers adjustmentsminimize any distractions related to our named executive officers’ base salaries after considering such factors as the prevailing market conditionstermination of employment and/or change in control and the named executive officer’s responsibilities, knowledge, skills, experience, and performance. These adjustments allow us to remain competitive in attracting and retaining executive talent. In fiscal year 2022, our Compensation Committee did not make any adjustments to the base salaries of our named executive officers.
The base salaries of our named executive officers during fiscal yearto focus on their duties and responsibilities to maximize stockholder value
| | Impact of 2022 Stockholder Advisory Vote on Compensation of Named Executive Officers We conducted a Say-on-Pay vote at our 2022 annual meeting of stockholders. Approximately 93% of the votes cast by stockholders were in favor of approving the compensation of our named executive officers, an increase from the preceding year’s result of 75%. While evaluating our executive compensation program in fiscal year 2023, our Compensation Committee considered the results and maintained the compensation philosophy and objectives and general approach to executive compensation from the prior year. Processes and Procedures for Compensation Decisions Our Compensation Committee is responsible for the compensation program for our executive officers and reports to our Board of Directors on its discussions, decisions and other actions. Involvement of Management In fiscal year 2023, our Chief Executive Officer, Chief People Officer, and certain other management team members typically attended Compensation Committee meetings and were involved in the determination of compensation for our other executives. These senior executives made recommendations to our Compensation Committee regarding short-term and long-term compensation for all executives (other than with respect to their own compensation) based on our results, an individual executive’s contribution toward these results, and each individual’s performance against their individual goals. Our Compensation Committee then reviewed the recommendations and other data provided by outside compensation advisors and management and made decisions as to the compensation for each executive. TABLE OF CONTENTS Use of Outside Advisors Our Compensation Committee is authorized to retain the services of executive compensation advisors, as it sees fit, for the establishment of our compensation programs and related policies and adjustments to the compensation elements and amounts. For our fiscal year ended January 31, 2023, our Compensation Committee retained Compensia, a national compensation consulting firm, to provide it with information, recommendations, and other advice relating to executive compensation on an ongoing basis. Compensia serves at the discretion of our Compensation Committee. Among other things, our Compensation Committee engaged Compensia to assist in developing and updating a group of peer companies to help us determine the level of overall compensation for our executives and assess each separate element of compensation, with a goal of providing compensation that is competitive, fair, motivating and retentive. The Compensation Committee reviewed the independence of Compensia under New York Stock Exchange and SEC rules and concluded that the work of Compensia has not raised any conflict of interest. Stockholder Engagement As owners of Box, we value our stockholders’ opinions and feedback on topics of interest to our stockholders, including on our executive officer and director compensation program and environmental, social and governance matters. Maintaining an active dialogue with our stockholders is consistent with our corporate values of transparency and accountability, and we intend to continue these efforts in the future. The feedback we receive from stockholders from our outreach program helps our Board of Directors, leadership team, and employees develop a mutual understanding and trust with our stockholders. Members of our Board of Directors and senior executives directly engage from time to time with stockholders to hear unfiltered concerns and perspectives that shape our core strategy and other decisions on matters of interest to our stockholders. As discussed below, after receiving feedback that stockholders would like to see a portion of the equity compensation for our named executive officers to be in the form of performance-based awards, the equity grants made to Ms. Carullo and Mr. Smith in fiscal years 2023 and 2024 were equally split between PSUs and RSUs. Peer Group Compensation Data With Compensia’s assistance, our Compensation Committee approved a group of public companies to be used when conducting a competitive market analysis of executive officer compensation. For our compensation decisions made on or before September 2022, which included our named executive officers’ equity awards approved in April 2022, our compensation peer group was made up of publicly-traded companies in the software industry that generally had revenues between $300 million and $1.9 billion, a market capitalization between $1.1 billion and $10.7 billion, a three-year compound annual growth rate (“CAGR”) below 20%, and generally were headquartered in California. TABLE OF CONTENTS In September 2022, our Compensation Committee re-assessed our compensation peer group based on an updated set of compensation peer group selection criteria. Using that updated criteria, our Compensation Committee approved an updated compensation peer group made up of publicly-traded companies in the software industry that generally had revenues between $500 million and $2 billion, a market capitalization between $1.2 billion and $10 billion, and generally are headquartered in California. The two compensation peer groups used in fiscal year 2023 were: | 8x8 Inc. | | | Removed | | | | | | | | | Added | | | Alteryx | | | Cloudera, Inc. | | | Removed | | | | | | | | | Added | | | Confluent Inc. | | | Cornerstone OnDemand Inc. | | | Removed | | | | | | | | | Added | | | Coupa Software | | | Dropbox, Inc. | | | | | | Dropbox, Inc. | | | | | | Added | | | Elastic N.V. | | | Five9 Inc. | | | | | | Five9 Inc. | | | Guidewire Software, Inc. | | | | | | Guidewire Software, Inc. | | | | | | Added | | | HashiCorp | | | | | | Added | | | Informatica | | | Mandiant, Inc.
(formerly FireEye, Inc.) | | | Removed | | | | | | Medallia, Inc. | | | Removed | | | | | | Momentive Global Inc.
(formerly SurveyMonkey Inc.) | | | Removed | | | | | | New Relic, Inc. | | | | | | New Relic, Inc. | | | Nutanix, Inc. | | | | | | Nutanix, Inc. | | | PagerDuty, Inc. | | | | | | PagerDuty, Inc. | | | Proofpoint Inc. | | | Removed | | | | | | Qualys, Inc. | | | | | | Qualys, Inc. | | | SolarWinds Corp | | | | | | SolarWinds Corp | | | | | | Added | | | Splunk Inc. | | | Stamps.com Inc. | | | Removed | | | | | | | | | Added | | | Teradata Corp | | | Verint Systems Inc. | | | | | | Verint Systems Inc. | | | Zendesk, Inc. | | | Removed | | | | | | Zuora, Inc. | | | Removed | |
Our Compensation Committee believed these companies were appropriate for our compensation peer group because they were viewed as similarly sized, operated in the same or similar industries as us, had similar growth trajectories, and reflected our competitive market for senior executives. In setting the elements of compensation for our named executive officers, our Compensation Committee reviewed base salary, target annual incentive compensation opportunity, target total short-term compensation (i.e., base salary plus target incentive opportunity), annual long-term incentive, and total direct compensation values for our named executive officers and those of similarly situated executives of our compensation peer group. Compensia provided data at the 25th, 50th, 60th and 75th percentiles for such compensation, and our Compensation Committee used this data as a reference. Our Compensation Committee did not benchmark any compensation element to a specific percentile, and our Compensation Committee instead set our named executive officers’ compensation at levels it deemed appropriate after considering other factors, such as each of our named executive officers’ contributions, our short-term and long-term objectives, and prevailing market conditions. TABLE OF CONTENTS Executive Compensation Program Elements The following sections describe each element of our executive compensation program, provide the rationale for each such element, and explain how our Compensation Committee determined compensation amounts and awards for our fiscal year ended January 31, 2023. Base Salary Base salary is the main fixed element of our named executive officers’ short-term compensation. Base salary compensates our named executive officers for services they provide to us during the fiscal year. Our Compensation Committee typically performs an annual review during which it considers adjustments to our named executive officers’ base salaries after considering such factors as the prevailing market conditions and the named executive officer’s responsibilities, knowledge, skills, experience, and performance. These adjustments allow us to remain competitive in attracting and retaining executive talent. In fiscal year 2023, our Compensation Committee did not change Mr. Levie’s base salary. Effective May 1, 2022, Mr. Smith received an increase in base salary from $370,000 to $425,000 and Ms. Carullo received an increase in base salary from $370,000 to $400,000 to be more competitive with similarly situated executives at the companies in our compensation peer group, after taking into account their individual performance and contributions to the company. The base salaries of our named executive officers during fiscal year 2023 are listed in the table below. | Mr. Levie
| | | $180,000
| | | Ms. Carullo
| | | $370,000
| | | Mr. Smith
| | | $370,000
| |
| Mr. Levie | | | $180,000 | | | $180,000 | | | Ms. Carullo | | | $370,000 | | | $400,000 | | | Mr. Smith | | | $370,000 | | | $425,000 | |
The total base salaries earned by our named executive officers during our fiscal year ended January 31, 2023 are listed in the “Summary Compensation Table for Fiscal Year 2023” section below. In March 2023, in light of the expected impact of the macro-economic environment on our business, and to help ensure we meet our operating margin commitments, our Compensation Committee approved a ten percent reduction in the base salaries of our named executive officers. Non-Equity Incentive Plan Compensation We use performance-based incentives to motivate our named executive officers to achieve our annual financial and operational objectives, while making progress towards our longer-term strategic and growth goals. Typically, near the beginning of each fiscal year, our Compensation Committee adopts the performance criteria and targets for the incentive compensation plan for that fiscal year, which identifies the plan participants and establishes the target incentive opportunity for each participant, the performance measures and the associated target levels for each measure, and the potential payouts based on actual performance for the fiscal year. Payments under our incentive compensation plan for fiscal year 2023 were made in an equal mix of cash and fully-vested RSUs. Fiscal Year 2023 Bonus Plan
• | Overview and Structure. In March 2022, our Compensation Committee adopted and approved our omnibus Executive Incentive Plan for fiscal year 2023 (the “Fiscal 2023 Executive Bonus Plan”). The Fiscal 2023 Executive Bonus Plan provided for potential performance-based incentive payouts to our named executive officers during our fiscal year ended January 31, 2022 are listed inbased on the “Summary Compensation Table for Fiscal Year 2022” below. Non-Equity Incentive Plan Compensation
We use performance-based incentives to motivate our named executive officers to achieve our annualachievement of pre-established corporate financial and operationalobjectives. The financial objectives while making progress towards our longer-term strategic and growth goals. Typically, near the beginning of each fiscal year, our Compensation Committee adopts the performance criteria and targets for the incentive compensation plan for that fiscal year, which identifies the plan participants and establishes the target incentive opportunity for each participant, the performance measures and the associatedwere set at target levels for each measure,determined to be challenging and the potential payouts based on actual performance for the fiscal year. Payments under our incentive compensation plan for fiscal yearrequiring substantial skill and effort by senior management to achieve.
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• | Target Annual Incentive Compensation Opportunities. In March 2022, were made in RSUs. For fiscal 2023 Executive Bonus Plan payouts, our Compensation Committee currently intends to pay any awards earned by our named executive officers in an equal mix of cash and fully vested shares of our Class A common stock. Fiscal Year 2022 Bonus Plan
• | Overview and Structure. In March 2021, our Compensation Committee adopted and approved our omnibus Executive Incentive Plan for fiscal year 2022 (the “Fiscal 2022 Executive Bonus Plan”). The Fiscal 2022 Executive Bonus Plan provided for potential performance-based incentive payouts to our named executive officers based on the achievement of pre-established corporate financial objectives. The financial objectives were set at target levels determined to be challenging and requiring substantial skill and effort by senior management to achieve.
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• | Target Annual Incentive Compensation Opportunities. In March 2021, in connection with its review of our executive compensation program, our Compensation Committee approved the target annual incentive compensation opportunities of our named executive officers, as set forth in the table below. In setting the target annual incentive compensation opportunities, our Compensation Committee considered each named executive officer’s performance, individual contributions, responsibilities, experience, prior annual incentive compensation amount, and peer group market data. Our Compensation Committee has set the target annual incentive compensation opportunities for our named executive officers as percentages of their base salaries paid throughout the year.
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For fiscal year 2022, our Compensation Committee maintained the percentages for our named executive officers from those determined for fiscal year 2021.
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The target annual incentive compensation opportunities established for fiscal year 2022 forof our named executive officers, were:as set forth in the table below. In setting the target annual incentive compensation opportunities, our Compensation Committee considered each
| Mr. Levie | | | 55% | | | $99,000 | | | Ms. Carullo | | | 55% | | | $203,500 | | | Mr. Smith | | | 55% | | | $203,500 | |
Corporate Performance Measures. To measure the performance of our named executive officers for the Fiscal 2022TABLE OF CONTENTS named executive officer’s performance, individual contributions, responsibilities, experience, prior annual incentive compensation amount, and peer group market data. Our Compensation Committee has set the target annual incentive compensation opportunities for our named executive officers as percentages of their base salaries paid throughout the year. For fiscal year 2023, our Compensation Committee made no changes to the percentages for our named executive officers from those used for fiscal year 2022. The target annual incentive compensation opportunities established for fiscal year 2023 for our named executive officers were: | Mr. Levie | | | 55% | | | $99,000 | | | Ms. Carullo | | | 55% | | | $215,875 | | | Mr. Smith | | | 55% | | | $226,188 | |
*
| The dollar amounts for Ms. Carullo and Mr. Smith were determined on a pro-rated basis, taking into account when their base salaries changed. |
• | Corporate Performance Measures. To measure the performance of our named executive officers for the Fiscal 2023 Executive Bonus Plan, our Compensation Committee selected revenue and non-GAAP operating income as those measures were deemed as best supporting the achievement of our annual operating plan and enhancing long-term value creation. We define (i) “revenue” as GAAP revenue as reflected in our quarterly and annual financial statements; and (ii) non-GAAP operating income as GAAP operating income as reflected in our quarterly and annual financial statements adjusted to exclude expenses related to stock-based compensation, intangible assets amortization, and as applicable, other special items. Each element was weighted equally under the Fiscal 2023 Executive Bonus Plan. Our Compensation Committee set the revenue and non-GAAP operating income thresholds to be significantly above our results for the fiscal year ended January 31, 2022, so that our revenue for fiscal year 2023 would have had to increase by at least 13.6% year over year and our non-GAAP operating income would have had to improve by at least 26.0% year over year in order for our named executive officers to earn the target annual incentive compensation under the Fiscal 2023 Executive Bonus Plan. |
The targets required for 100% achievement under our Fiscal 2023 Executive Bonus Plan and our results were: | Revenue | | | $993.0 | | | $990.9 | | | 99.8% | | | 99.8% | | | Non-GAAP Operating Income | | | $218.5 | | | $229.0 | | | 104.8% | | | 100.6% | | | Total | | | | | | | | | | | | 100.2% | |
• | Methodology. Our Compensation Committee assesses performance and determines payouts under our Fiscal 2023 Executive Bonus Plan in a two-part process: first, our Compensation Committee measures actual performance against the pre-established goals for the annual performance period; and second, after the end of the performance period, our Compensation Committee may exercise discretion to determine the actual payout. As a threshold matter, our named executive officers were eligible for annual incentive compensation payouts with respect to the revenue component only if we met or exceeded 95% of the revenue target for our fiscal year ended January 31, 2023 and with respect to the non-GAAP operating income component only if we met or exceeded 80% of the non-GAAP operating income target for our fiscal year ended January 31, 2023. High thresholds (in both cases, above fiscal year 2022 actual performance) are required to ensure that significant achievement is a prerequisite to receive any incentive payment. With respect to the revenue performance measure, the payment percentage equals the percentage of the revenue target that was achieved until 103% achievement, and achievement over |
TABLE OF CONTENTS 103% is rewarded using an “accelerator” where each point of performance above 103% achievement increases the payout percentage by two percentage points. With respect to the non-GAAP operating income component, achievement at 80% equals a payout percentage of 25%, and the payout percentage is increased (1) by 3.75 percentage points for each point of performance above 80% (until a payout percentage of 100% for performance at 100%) and (2) by 0.133 percentage points for each point of performance above 100%, up to a maximum payout percentage of 110%. The payout curves for the revenue and non-GAAP operating income metrics are illustrated below. • | Caps on Payment. The cap on total payouts of the non-GAAP operating income component was set to manage potential incentive compensation costs and maintain appropriate incentives for our named executive officers.
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• | Performance in Fiscal Year 2023 and Related Payout. For fiscal year 2023, we achieved approximately 99.8% of target revenue and approximately 104.8% of target non-GAAP operating income. The revenue measure achievement resulted in a payout percentage of 99.8% of target and the non-GAAP operating income measure achievement resulted in a payout percentage of 100.6% of target. As each metric was weighted 50%, this resulted in a calculated payout percentage of approximately 100.2%, and our Compensation Committee did not make any adjustment to this payout percentage. |
The target and actual payouts to our named executive officers under the Fiscal 2023 Executive Bonus Plan were: | Mr. Levie | | | $99,000 | | | $99,208 | | | Ms. Carullo | | | $215,875 | | | $216,328 | | | Mr. Smith | | | $226,188 | | | $226,663 | |
Fifty percent of the payouts were made in the form of fully vested RSUs and 50% of the payouts were made in cash. The number of RSUs each named executive officer received equaled the dollar value of their actual award payment divided by the average closing price of a share of our Class A common stock for the 30-trading day period ending the trading day before the grant approval date. The value of the RSUs received in settlement of these bonuses under the Fiscal 2023 Executive Bonus Plan are listed in the “Non-Equity Incentive Plan Compensation” column of the “Summary Compensation Table for Fiscal Year 2023” below. Since the intended payout values above were converted into a number of RSUs based on the 30-trading day average closing price described above, the values set forth in the Summary TABLE OF CONTENTS Compensation Table for fiscal year 2023 (which are required by the disclosure rules to be calculated based on the closing price of our Class A common stock on the date the RSUs were granted, in accordance with FASB ASC Topic 718) are different from the payout values set forth in the table above. Equity Awards Our Compensation Committee grants equity awards to our named executive officers in order to align their long-term interests with our stockholders’ interests. Our Compensation Committee determines the size of the equity awards we grant to our named executive officers in connection with their hire through arm’s-length negotiation, considering such factors as prevailing market conditions, market data for new-hire awards, the named executive officer’s expected short-term compensation, the equity award’s potential incentive and retention value, and the named executive officer’s prospective role and responsibilities. Our Compensation Committee also periodically grants equity awards to our named executive officers for promotions, as an additional incentive to continue service with us, or to recognize exceptional corporate and individual performance. Our Compensation Committee does not apply a fixed formula when determining the size of these equity awards because it grants an amount of equity that it believes properly rewards the named executive officer for their contributions to the growth in our long-term stockholder value. In doing so, our Compensation Committee considers factors such as the economic value of the named executive officer’s unvested equity awards and the ability of this equity to satisfy our retention objectives; the named executive officer’s performance, contributions, responsibilities, and experience; the equity awards granted by our compensation peer group to similarly situated executives; a compensation analysis performed by Compensia; and other internal equity considerations. Fiscal Year 2023 Equity Awards
• | Overview and Structure. In the first quarter of fiscal year 2023, our Compensation Committee approved equity incentive awards to Ms. Carullo and Mr. Smith, in the form of both PSUs and RSUs. Unlike fiscal year 2022, our Compensation Committee determined that it would grant 50% of the equity value in the form of RSUs that vest solely based on service over a four-year period and 50% of the equity value in the form of PSUs that are tied to achieving revenue and non-GAAP operating income performance goals during our fiscal year 2023. The goal of these PSUs is to align the interests of our named executive officers with those of our stockholders and to incentivize them to meet our operating targets. Our Compensation Committee selected revenue and non-GAAP operating income as the performance measures for the PSUs as those measures were deemed as best supporting the achievement of our annual operating plan and enhancing long-term value creation. We define (i) “revenue” as GAAP revenue as reflected in our quarterly and annual financial statements; and (ii) non-GAAP operating income as GAAP operating income as reflected in our quarterly and annual financial statements adjusted to exclude expenses related to stock-based compensation, intangible assets amortization, and other special non-recurring items. Each element was weighted equally under the Fiscal 2022 Executive Bonus Plan. |
The targets required for 100% achievement under our Fiscal 2022 Executive Bonus Plan and our results were:
| Revenue | | | $844.0 | | | $874.3 | | | 103.6% | | | Non-GAAP Operating Income | | | $139.9 | | | $173.4 | | | 124.0% | |
• | Methodology. Our Compensation Committee assesses performance and determines payouts under our Fiscal 2022 Executive Bonus Plan in a two-part process: first, our Compensation Committee measures actual performance against the pre-established goals for the annual performance period; and second, after the end of the performance period, our Compensation Committee exercises discretion to determine the actual payout. As a threshold matter, our named executive officers were eligible for annual incentive compensation payouts with respect to the revenue component only if we met or exceeded 95% of the revenue target for our fiscal year ended January 31, 2022 and with respect to the non-GAAP operating income component only if we met or exceeded 80% of the non-GAAP operating income target for our fiscal year ended January 31, 2022. High thresholds are required to ensure that significant achievement is a prerequisite to receive any incentive payment. With respect to the revenue performance measure, the payment percentage equals the percentage of the revenue target that was achieved until 103% achievement, and achievement over 103% may be rewarded using an “accelerator” where each point of performance above 103% achievement increases the payout percentage by two percentage points. With respect to the non-GAAP operating income component, achievement at 80% equals a payout percentage of 25%, and the payout percentage is increased (1) by 3.75 percentage points for each point of performance above 80% (until a payout percentage of 100% for performance at 100%) and (2) by 0.133 percentage points for each point of performance above 100%, up to a maximum payout percentage of 110%. The payout curves for the revenue and non-GAAP operating income metrics are illustrated below.
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• | Caps on Payment. The cap on total payouts of the non-GAAP operating income component was set to manage potential incentive compensation costs and maintain appropriate incentives for our named executive officers.
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• | Performance in Fiscal Year 2022 and Related Payout. For fiscal year 2022, we achieved approximately 103.6% of target revenue and approximately 124.0% of target non-GAAP operating income. The revenue measure achievement resulted in a payout percentage of 104.2% of target and the non-GAAP operating income measure achievement resulted in a payout percentage of 103.2% of target. As each metric was weighted 50%, this resulted in a calculated payout percentage of approximately 103.7%, and our Compensation Committee did not make any adjustment to this payout percentage.
|
The intended values of the total payouts to our named executive officers under the Fiscal 2022 Executive Bonus Plan were:
| Mr. Levie | | | $99,000 | | | $102,653 | | | Ms. Carullo | | | $203,500 | | | $211,009 | | | Mr. Smith | | | $203,500 | | | $211,009 | |
The payouts were made in the form of fully vested RSUs. The number of RSUs each named executive officer received equaled the dollar value of their actual award payment divided by the average closing price of a share of our Class A common stock for the 30-trading day period ending the trading day before the grant approval date.
The value of the RSUs received in settlement of these bonuses under the Fiscal 2022 Executive Bonus Plan are listed in the “Non-Equity Incentive Plan Compensation” column of the “Summary Compensation Table for Fiscal Year 2022” below. Since the intended payout values above were converted into a number of RSUs based on the 30-trading day average closing price described above, the values set forth in the Summary Compensation Table for fiscal year 2022 (which were instead calculated based on the closing price of our Class A common stock on the date the RSUs were granted, in accordance with FASB ASC Topic 718) are different from the payout values set forth in the table above.
TABLE OF CONTENTS
Equity Awards
Our Compensation Committee grants equity awards to our named executive officers in order to align their long-term interests with our stockholders’ interests.
Our Compensation Committee determines the size of the equity awards we grant to our named executive officers in connection with their hire through arm’s-length negotiation, considering such factors as prevailing market conditions, market data for new-hire awards, the named executive officer’s expected short-term compensation, the equity award’s potential incentive and retention value, and the named executive officer’s prospective role and responsibilities.
Our Compensation Committee also periodically grants equity awards to our named executive officers for promotions, as additional incentive to continue service with us, or to recognize exceptional corporate and individual performance. The Compensation Committee does not apply a fixed formula when determining the size of these equity awards because we grant an amount of equity that it believes properly rewards the named executive officer for their contributions to the growth in our long-term stockholder value. In doing so, the Compensation Committee considers factors such as the economic value of the named executive officer’s unvested equity awards and the ability of this equity to satisfy our retention objectives; the named executive officer’s performance, contributions, responsibilities, and experience; the equity awards granted by our compensation peer group to similarly situated executives; a compensation analysis performed by Compensia; and other internal equity considerations.
For fiscal year 2022 grants, granted in April 2021, in light of the reduced predictability in business outcomes during the recovery from the COVID-19 pandemic, the Compensation Committee decided to focus on retention and stability and accomplished these goals by awarding long-term compensation through time-based RSUs. After considering the peer group data provided by Compensia, the unvested equity award holding value and the anticipated future contributions of our named executive officers, our Compensation Committee approved the grant of annual equity awards to Ms. Carullo and Mr. Smith and Ms. Carullo at a level deemed competitive with the annual long-term incentives provided by the companies in our compensation peer group to similarly situated executives, as follows: (i) an awardawards of 175,00075,000 RSUs and 75,000 PSUs (at target) to Ms. Carullo, and (ii) awards of 82,500 RSUs and 82,500 PSUs (at target) to Mr. Smith, and (ii) an award of 150,000 RSUs to Ms. Carullo.Smith. Mr. Levie requested thatdeclined to receive any equity awards hethat our Compensation Committee would have otherwise been granted be re-allocated to the overall equity budget for issuance to our employees.him.
|
• | Fiscal Year 2023 RSUs. Ms. Carullo’s and Mr. Smith’s and Ms. Carullo’s awards of RSUs each was scheduled to vest as to one-sixthteenthone-sixteenth of the award on June 20, 20212022 and as to one-sixthteenthone-sixteenth of the award each quarter thereafter, subject to their continued service with us through the applicable vesting date. Our Compensation Committee believes that granting a portion of the awards in the form of time-based RSUs supports the retention and motivation of our named executive officers, and aligns their interest with the long-term interests of our stockholders.
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TABLE OF CONTENTS • | Fiscal Year 2023 PSUs. The PSUs granted to stockholder feedback,Ms. Carullo and Mr. Smith provide that up to 50% of the target number of shares were eligible to vest based upon achieving a pre-determined annual revenue goal. The remaining 50% of the target number of shares were eligible to vest based upon achieving a pre-determined non-GAAP operating income goal for fiscal 2023 Mr. Smith and Ms. Carullo were awarded annual equity awards split equally between awards that vest solely based on service and awards that have an additional performance requirement based on performance againstyear 2023. Our Compensation Committee set the revenue and non-GAAP operating income targets to be significantly above our results for the fiscal year ended January 31, 2022, so that our revenue for fiscal 2023. Mr. Levie received no fiscalyear 2023 equity awards because he requested that any awards he would have otherwise been grantedhad to increase by at least 13.6% year over year and our non-GAAP operating income would have had to improve by at least 26.0% year over year in order for Ms. Carullo and Mr. Smith to be re-allocatedeligible to vest in the target number of shares subject to the overall equity budgetPSUs. The targets required for issuance100% achievement under our fiscal year 2023 PSUs and our results were as follows: |
| Revenue | | | $993.0 | | | $990.9 | | | 99.8% | | | 99.5% | | | Non-GAAP Operating Income | | | $218.5 | | | $229.0 | | | 104.8% | | | 112.1% | | | Total | | | | | | | | | | | | 105.8% | |
In granting PSUs to our named executive officers, our Compensation Committee considered feedback from stockholders and sought to incentivize our named executive officers to achieve challenging financial targets that would drive stockholder value. • | Methodology. As a threshold matter, our named executive officers were eligible to vest under the PSUs with respect to either the revenue or non-GAAP operating income component only if we met or exceeded 80% of the respective revenue or non-GAAP operating income target for our fiscal year ended January 31, 2023. High thresholds (in both cases, above fiscal year 2022 actual performance) are required to ensure that significant achievement is a prerequisite to receive any payout under the PSUs. With respect to each of the revenue and non-GAAP operating income performance measure, achievement at 80% of target means 50% of the target number of shares subject to the PSUs would become eligible to vest. Moreover, if the target revenue or target non-GAAP operating income goals are exceeded, up to an additional number of shares equal to 50% of the target number may become eligible to vest. The payout percentage between threshold and maximum achievement is determined by straight line interpolation until achievement is capped at 120% of the target performance measure. The payout curves for the revenue and non-GAAP operating income metrics are illustrated below: |
• | Caps on Payment. The 150% cap on total payouts of the revenue and non-GAAP operating income components was set to manage potential dilution and incentive compensation costs and maintain appropriate incentives for our named executive officers.
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TABLE OF CONTENTS • | PSU Achievement and Related Payouts. The target and actual payouts to our employees.named executive officers under the Fiscal 2023 PSUs were: |
| Ms. Carullo | | | 75,000 | | | 79,335 | | | Mr. Smith | | | 82,500 | | | 87,268 | |
• | Additional Service-Based Vesting Requirement. The PSUs that are earned then vest based upon continued service, with one third of the shares that are eligible to vest based upon fiscal year 2023 revenue and non-GAAP operating income achievement vested on April 4, 2023, and one third of such earned shares vesting on each of the next two anniversaries thereof, so as to be 100% vested on April 4, 2025, subject to continued service with us through the applicable vesting date. The additional service requirement acts as an additional retention incentive and motivates our named executive officers to contribute to the growth in our long-term stockholder value. |
Employee Benefit Plans Our named executive officers participate in our employee benefits programs on the same terms as our other U.S.-based, full-time employees with no special executive programs. We have a 401(k) Savings Plan (the “401(k) Plan”). Under the 401(k) Plan, participating employees may elect to contribute up to 100% of their eligible compensation, subject to certain limitations. We have not made any matching contributions to date. We maintain other welfare benefit plans, including health, dental and vision insurance; medical and dependent care flexible spending accounts; short- and long-term disability insurance; life insurance; and accidental death and dismemberment insurance, which we believe are generally consistent with those offered by companies we compete with for employees. For our fiscal year ended January 31, 2022,2023, we also paid certain amounts on behalf of our named executive officers for basic life insurance, as indicated in the “Summary“Summary Compensation Table for Fiscal Year 2022”2023” below. TABLE OF CONTENTS
Perquisites and OtherSpecial Personal Benefits We currently do not provide perquisites or otherany special personal benefits to our named executive officers, but we may provide perquisites or other personal benefits in the future for purposes of recruitment, motivation, or retention; to assist an individual named executive officer in the performance of their duties; and in other limited circumstances. Our Compensation Committee will periodically review and approve all future practices concerning perquisites and other personal benefits. Change in Control and Severance Arrangements We have entered into change in control and severance agreements with our named executive officers, which require us to make specific payments and benefits in connection with the termination of such named executive officers’ employment under certain circumstances. We believe that these change in control agreements provide retention value by encouraging our named executive officers to continue service with us and increase stockholder value by reducing any potential distractions caused by the possibility of an involuntary termination of employment or a potential change in control, allowing our named executive officers to focus on their duties and responsibilities. Under these arrangements, a change in control is generally defined as a change in more than 50% of the total voting power of our stock, certain changes in the majority composition of the Board during a 12-month period, or a change in the ownership of a substantial portion of the company’s assets. In June 2021, our Compensation Committee approved an amendment to our 2015 Equity Incentive Plan to provide that if the service of aany plan participant (including each named executive officer) ceases as a result of the participant’s death or disability, the vesting of all of his or her outstanding awards granted under our 2015 Equity Incentive Plan will accelerate. TABLE OF CONTENTS For a summary of the material terms and conditions of these severance and change in control arrangements and this vesting acceleration provision under our 2015 Equity Incentive Plan, see the section titled “Potential Payments upon Termination or Change in Control” contained in this Proxy Statement.proxy statement. Stock Ownership Guidelines Our Board of Directors believes that our named executive officers should hold a meaningful financial stake in the company in order to further align their interests with those of our stockholders. As such, our Board of Directors has adopted stock ownership guidelines that require our executive officers to achieve specified ownership levels by the later of (i) five years of such individual’s appointment or promotion date, as applicable, and (ii) July 2, 2024. In February 2023, our Compensation Committee amended the stock ownership guidelines to increase the specified ownership levels for our Chief Executive Officer and all other named executive officers. Our Compensation Committee also amended the stock ownership guidelines so that vested and unvested stock options and unearned PSUs are not considered qualifying stock ownership holdings counted towards compliance with the guidelines. A full description of our current stock ownership guidelines, as amended, is available on our website at http:https://www.box.com/investorswww.boxinvestorrelations.com and is summarized as follows: our Chief Executive Officer must own company stock with a value of fourfive times his annual base salary; and all other named executive officers (except for the Chief Executive Officer) must own company stock with a value of onetwo times their annual base salary. As of January 31, 2022,May 1, 2023, all of our named executive officers met, exceeded, or were on track to meet these ownership guidelines within the time frames set out above based on their respective rates of stock accumulation. Clawback Policy Our Board has also adopted a clawback policy (the “Clawback Policy”) permitting the company to seek the recovery of cash-based incentive compensation or performance-based equity compensation paid to certain current and former officers of the company who are subject to Section 16 of the Exchange Act. The Clawback Policy provides that the company may seek recovery if (i) the company materially restates all or a portion of its financial statements; (ii) the amount of cash incentive compensation or performance-based equity compensation that was paid or is payable based on achievement of financial or operating results paid to a participant would have been less if the financial statements had been correct at the time the incentive compensation was originally calculated or determined; (iii) no more than three years have elapsed since the original filing date of the financial statements upon which the incentive compensation was calculated or determined; and (iv) our Compensation Committee concludes, in its sole discretion, that the gross negligence, intentional misconduct or fraud by such participant caused or partially caused the material restatement of all or a portion of the financial statement(s) and that such participant should repay to the company all of the recoverable compensation. We intend to review and amend, as necessary, the Clawback Policy when the New York Stock Exchange’s final listing standards to implement the clawback policy rules required by the Dodd-Frank Wall Street Reform and Consumer Protection Act become effective. TABLE OF CONTENTS Insider Trading Policy and Use of 10b5-1 Trading Plans Our insider trading policy prohibits all directors and employees (including our named executive officers) from engaging in the following activities with respect to our common stock: trading in derivative securities, hedging transactions, short sales, pledging stock as collateral, or holding stock in a margin account. From time to time, our officers and directors may elect to enter into 10b5-1 trading plans. As of the date of this Proxy Statement, Ms. Hammondsproxy statement, Messrs. Lazar, Levie and Mr. Smith had active 10b5-1 trading plans. Accounting Considerations Authoritative accounting guidance on stock compensation requires measurement of the compensation expense for all share-based awards made to employees (such as our named executive officers) and directors based on the grant date “fair value” of the awards. Our Compensation Committee considers the accounting expense associated with equity awards. Even though our named executive officers and directors may realize no value from their equity awards, these values have been calculated for accounting purposes and reported in the tables below. This guidance also requires us to recognize the compensation cost of share-based awards in our income statements over the period that the named executive officer or director is required to continue service with us in order for the equity award to vest. Our Compensation Committee reviews and discusses with management the risks arising from our compensation philosophy and practices applicable to all employees to determine whether they encourage excessive risk-taking and to evaluate compensation policies and practices that could mitigate such risks. In addition, our Compensation Committee has engaged Compensia to independently review the risks associated with our executive compensation program. Based on these reviews, our Compensation Committee structures our executive compensation program to encourage our named executive officers to focus on both short-term and long-term success. We do not believe that our executive compensation program creates risks that are reasonably likely to have a material adverse effect on us. TABLE OF CONTENTS | Incentive compensation designed to be aligned with creation of long-term value for stockholders | | | • Payouts under our Fiscal 20222023 Executive Bonus Plan and PSUs are based on achievement of revenue and non-GAAP operating income targets. These performance measures are viewed as supportive of our annual operating plan and create incentives for our named executive officers to create long-term value for our stockholders. | | | | | | | | | Clawback policy | | | • Our Clawback Policy applies to certain current and former officers of the company who are subject to Section 16 of the Exchange Act. | | | • Under the Clawback Policy, cash-based incentive compensation or performance-based equity compensation may be recovered from covered individuals if: | | | ○the company materially restates all or a portion of its financial statements; | | | ○ the amount of cash incentive compensation or performance-based equity compensation that was paid or is payable based on achievement of financial or operating results paid to a participant would have been less if the financial statements had been correct at the time the incentive compensation was originally calculated or determined; | | | ○ no more than three years have elapsed since the original filing date of the financial statements upon which the incentive compensation was calculated or determined; and | | | ○ the Compensation Committee concludes, in its sole discretion, that the gross negligence, intentional misconduct or fraud by such participant caused or partially caused the material restatement of all or a portion of the financial statement(s) and that such participant should repay to the company all of the recoverable compensation. | | | | | | | | | Hedging and pledging policies | | | • Our insider trading policy prohibits all directors and employees, including our named executive officers, from engaging in the following activities with respect to our common stock: trading in derivative securities, hedging transactions, short sales, pledging stock as collateral, or holding stock in a margin account. | | | • These policies are intended to prevent a misalignment, or appearance of misalignment, of interests with stockholders. | | | | | | | | | Stock ownership guidelines | | | • Our executive officers and non-employee directors are required to achieve levels of ownership of company stock with the following values within the later of (i) five years of such individual’s appointment, election or promotion date, as applicable, and (ii) July 2, 2024: | | | ○ Non-employee directors: threefive times the annual cash retainer for Board service | | | ○ Chief Executive Officer: fourfive times annual base salary | | | ○ Other named executive officers: onetwo times annual base salary. | | | • As of January 31, 2022,2023, all of our directors and named executive officers met, exceeded, or were on track to meet these ownership guidelines within the time frames set out above based on their respective rates of stock accumulation. | |
TABLE OF CONTENTS Compensation Committee Report Our Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis provided above with management. Based on such review and discussion, our Compensation Committee has recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statementproxy statement and our Annual Report on Form 10-K for our fiscal year ended January 31, 2022.2023. Respectfully submitted by the members of our Compensation Committee of the Board of Directors: Bethany Mayer (Chair) Sue Barsamian Peter Leav
John Park TABLE OF CONTENTS Summary Compensation Table for Fiscal Year 20222023 | Name and Principal Position | | Year | | Salary
($) | | Bonus
($) | | Stock
Awards
($)(1) | | Option
Awards
($)(1) | | Non-Equity
Incentive Plan
Compensation
($)(2) | | All Other
Compensation
($)(3) | | Total
Compensation
($) | | Name and Principal Position | | Year | | Salary
($) | | Bonus
($) | | Stock
Awards
($)(1) | | Non-Equity
Incentive Plan
Compensation
($)(2) | | All Other
Compensation
($)(3) | | Total
Compensation
($) | | | Aaron Levie
Chief Executive Officer | | | 2022 | | 180,000 | | — | | — | | — | | 112,301 | | 213 | | 292,514 | | Aaron Levie
Chief Executive Officer | | | 2023 | | 180,000 | | — | | — | | 93,378 | | 201 | | 273,579 | | | 2021 | | 180,000 | | — | | — | | — | | 108,027 | | 217 | | 288,244 | | | 2022 | | 180,000 | | — | | — | | 112,301 | | 213 | | 292,514 | | | 2020 | | 180,000 | | — | | — | | — | | 52,426 | | 289 | | 232,715 | | | 2021 | | 180,000 | | — | | — | | 108,027 | | 217 | | 288,244 | | | Stephanie Carullo
Chief Operating Officer | | | 2022 | | 370,000 | | | | 3,598,500 | | | | 230,797 | | 820 | | 4,200,117 | | Stephanie Carullo
Chief Operating Officer | | | 2023 | | 392,500 | | — | | 4,389,000 | | 203,590 | | 434 | | 4,985,524 | | | 2021 | | 370,000 | | — | | 1,803,750 | | — | | 222,027 | | 443 | | 2,396,220 | | | 2022 | | 370,000 | | — | | 3,598,500 | | 230,797 | | 820 | | 4,200,117 | | | 2020 | | 370,000 | | — | | — | | 1,600,000 | | 107,765 | | 308 | | 2,078,073 | | | 2021 | | 370,000 | | — | | 1,803,750 | | 222,027 | | 443 | | 2,396,220 | | | Dylan Smith
Chief Financial Officer | | | 2022 | | 370,000 | | | | 4,198,250 | | | | 230,797 | | 438 | | 4,799,485 | | Dylan Smith
Chief Financial Officer | | | 2023 | | 411,250 | | — | | 4,827,900 | | 213,312 | | 452 | | 5,452,914 | | | 2021 | | 370,000 | | — | | 2,886,000 | | — | | 222,027 | | 446 | | 3,478,473 | | | 2022 | | 370,000 | | — | | 4,198,250 | | 230,797 | | 438 | | 4,799,485 | | | 2020 | | 366,667 | | — | | — | | 2,400,000 | | 106,824 | | 308 | | 2,873,799 | | | 2021 | | 370,000 | | — | | 2,886,000 | | 222,027 | | 446 | | 3,478,473 | |
(1)
| The amounts reported represent the grant date fair value of the awards granted to the named executive officers during fiscal years 2023, 2022 2021 and 20202021 (other than the RSUs granted in settlement of incentive compensation awards under the Executive IncentiveBonus Plan for fiscal years 2021, 20202022 and 2019,2021, which, in the case of such RSUs granted in fiscal years 20222023 and 2021,2022, are included in the “Non-Equity Incentive Plan Compensation” column for the prior fiscal year) as computed in accordance with FASB ASC Topic 718. The grant date fair value of RSUs and PSUs granted is based on the closing stock price on the date of grant. The assumptions used in calculating the grant, date fair value of option awards are set forth in Note 12 to our audited consolidated financial statements included in our Annual Report on Form 10-Kand for our fiscal year ended January 31, 2022. For fiscal years 2022, 2021 and 2020,PSUs, assuming achievement at target. Mr. Levie requested that any equity awards he would have otherwise been granted be re-allocateddeclined to the overall equity budget for issuance to our employees. Our Compensation Committee honored his request and, as such, he did not receive any equity awards in fiscal year 2023, 2022 2021 or 2020.2021. |
(2)
| The amounts reported represent incentive compensation awards earned in fiscal years 2023, 2022 2021 and 20202021 by the named executive officers under the Executive IncentiveBonus Plan. The material terms of the incentive compensation awards are described in the section titled “Executive Compensation Program Elements—Non-Equity Incentive Plan Compensation.” The incentive compensation awards were paid in the form of cash and fully vested RSUs, and the amounts reported reflect the grant date fair value of such RSUs, as computed in accordance with FASB ASC Topic 718 based on the closing stock price on the date of grant. The number of such RSUs granted in fiscal 20222023 (in settlement of the incentive awards granted under the fiscal 20212022 Executive Bonus Plan) is set forth in “Grants of Plan-Based Awards in Fiscal Year 2022”2023” table below. |
(3)
| The amounts reported represent amounts paid on behalf of the named executive officers for basic life insurance as well as employee gift cards for Ms. Carullo.Carullo and Messrs. Levie and Smith. |
Grants of Plan-Based Awards in Fiscal Year 20222023The following table sets forth information regarding grants of plan-based awards made to our named executive officers during fiscal year 2022.2023. | Aaron Levie
| | | —
| | | —
| | | 99,000(2)
| | | —
| | | —
| | | —
| | | —
| | | —
| | | —
| | | —
| | | —
| | | 04/01/2021
| | | —
| | | —
| | | —
| | | —
| | | —
| | | —
| | | 4,503(3)
| | | —
| | | —
| | | 108,027(4)
| | | Stephanie Carullo
| | | —
| | | —
| | | 203,500(2)
| | | —
| | | —
| | | —
| | | —
| | | —
| | | —
| | | —
| | | —
| | | 04/01/2021
| | | —
| | | —
| | | —
| | | —
| | | —
| | | —
| | | 9,255(3)
| | | —
| | | —
| | | 222,027(4)
| | | 04/02/2021
| | | —
| | | —
| | | —
| | | —
| | | —
| | | —
| | | 150,000(5)
| | | —
| | | —
| | | 3,598,500
| | | Dylan Smith
| | | —
| | | —
| | | 203,500(2)
| | | —
| | | —
| | | —
| | | —
| | | —
| | | —
| | | —
| | | —
| | | 04/01/2021
| | | —
| | | —
| | | —
| | | —
| | | —
| | | —
| | | 9,255(3)
| | | —
| | | —
| | | 222,027(4)
| | | 04/02/2021
| | | —
| | | —
| | | —
| | | —
| | | —
| | | —
| | | 175,000(5)
| | | —
| | | —
| | | 4,198,250
| |
| Aaron Levie
| | | — | | | — | | | 99,000(2) | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | 04/01/2022 | | | — | | | — | | | — | | | — | | | — | | | — | | | 3,898(3) | | | — | | | — | | | 112,301(4) | | | Stephanie Carullo | | | — | | | — | | | 215,875(2) | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | 04/01/2022 | | | — | | | — | | | — | | | — | | | — | | | — | | | 8,011(3) | | | — | | | — | | | 230,797(4) | | | 04/04/2022 | | | — | | | — | | | — | | | — | | | — | | | — | | | 75,000(5) | | | — | | | — | | | 2,194,500 | | | 04/04/2022 | | | — | | | — | | | — | | | 37,500 | | | 75,000(6) | | | 112,500 | | | — | | | — | | | — | | | 2,194,500 | | | Dylan Smith | | | — | | | — | | | 226,188(2) | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | 04/01/2022 | | | — | | | — | | | — | | | — | | | — | | | — | | | 8,011(3) | | | — | | | — | | | 230,797(4) | | | 04/04/2022 | | | — | | | — | | | — | | | — | | | — | | | — | | | 82,500(5) | | | — | | | — | | | 2,413,950 | | | 04/04/2022 | | | — | | | — | | | — | | | 41,250 | | | 82,500(6) | | | 123,750 | | | — | | | — | | | — | | | 2,413,950 | |
(1)
| The amounts reported represent the grant date fair value of the awards granted to the named executive officers as computed in accordance with FASB ASC Topic 718, calculated based on the closing stock price on the date of grant. |
(2)
| This amount represents the target value of the named executive officer’s bonus under our Fiscal 20222023 Executive Bonus Plan. There is no threshold amount under our Fiscal 20222023 Executive Bonus Plan because our Compensation Committee exercises discretion to determine the actual payouts and, therefore, there is no minimum amount payable for a certain level of performance. |
(3)
| The amounts reported represent the number of fully vested RSUs issued to Ms. Carullo and Messrs. Levie and Smith in our fiscal year ended January 31, 20222023 in settlement of the incentive awards granted under the Fiscal 20212022 Executive Bonus Plan. |
TABLE OF CONTENTS
(4)
| The amounts reported represent the grant date fair value of the fully vested RSUs issued to Ms. Carullo and Messrs. Levie and Smith in our fiscal year ended January 31, 20222023 in settlement of the incentive awards granted under the Fiscal 20212022 Executive Bonus Plan, as computed in accordance with FASB ASC Topic 718 based on the closing stock price on the date of grant. These amounts are reflected as fiscal year 20212022 compensation in the Summary Compensation Table for Fiscal Year 2022.2023. |
TABLE OF CONTENTS (5)
| The amounts reported represent the number of RSUs issued as merit awards to Ms. Carullo and Mr. Smith in our fiscal year ended January 31, 2022.2023. |
(6)
| The amounts reported represent the number of PSUs issued as merit awards to Ms. Carullo and Mr. Smith in our fiscal year ended January 31, 2023. |
Outstanding Equity Awards at 20222023 Fiscal Year-End The following table provides information regarding equity awards held by our named executive officers as of January 31, 2022.2023. | | | | | | Option Awards | | | | Stock Awards | | | | | | | Option Awards | | Stock Awards | | | Name | | Grant Date | | Number of
Securities
Underlying
Unexercised
Options
Exercisable
(#) | | Number of
Securities
Underlying
Unexercised
Options
Unexercisable
(#) | | Number of
Securities
Underlying
Unexercised
Unearned
Options | | Option
Exercise
Price
($) | | Option
Expiration
Date | | Number of
Shares of
Stock that
Have Not
Vested
(#) | | Market
Value of
Shares of
Stock That
Have Not Vested
($)(1) | | Name | | Grant Date | | Number of
Securities
Underlying
Unexercised
Options
Exercisable
(#) | | Number of
Securities
Underlying
Unexercised
Options
Unexercisable
(#) | | Option
Exercise
Price
($) | | Option
Expiration
Date | | Number of
Shares of
Stock that
Have Not
Vested
(#) | | Market
Value of
Shares of
Stock That
Have Not
Vested
($)(1) | | Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other Rights
That Have
Not Vested
(#) | | Equity
Incentive Plan
Awards:
Market or
Payout Value
of Unearned
Shares, Units
or Other
Rights
That Have
Not Vested
($) | | | Aaron Levie | | | 04/02/2012(2) | | 770,000 | | — | | — | | 1.16 | | 04/01/2022 | | — | | — | | Aaron Levie | | — | | — | | — | | — | | — | | — | | — | | — | | — | | | 04/02/2012(2) | | 820,000 | | — | | — | | 4.00 | | 04/01/2022 | | — | | — | | Stephanie Carullo | | | 08/01/2017(2) | | 400,000 | | — | | 19.01 | | 07/30/2027 | | — | | — | | — | | — | | | 04/27/2012(2) | | 410,000 | | — | | — | | 4.00 | | 04/27/2022 | | — | | — | | | 04/03/2019(3) | | 191,666 | | 8,334 | | 20.12 | | 04/03/2029 | | — | | — | | — | | — | | | 04/10/2018(3) | | | | | | 400,000 | | 20.28 | | 04/10/2018 | | | | | | | 04/03/2020(4) | | — | | — | | — | | — | | 39,063 | | 1,249,625 | | — | | — | | | Stephanie Carullo | | | 08/01/2017(2) | | 400,000 | | — | | — | | 19.01 | | 07/30/2027 | | — | | — | | | 04/02/2021(5) | | — | | — | | — | | — | | 84,375 | | 2,699,156 | | — | | — | | | 04/03/2019(4) | | — | | — | | 200,000 | | 20.12 | | 04/03/2029 | | — | | — | | | 04/04/2022(6) | | — | | — | | — | | — | | 60,938 | | 1,949,407 | | — | | — | | | 04/03/2020(5) | | — | | — | | — | | — | | — | | 70,313 | | 1,837,279 | | | 04/04/2022(7) | | — | | — | | — | | — | | — | | — | | 79,335 | | 2,537,927 | | | 04/02/2021(6) | | — | | — | | — | | — | | — | | 121,875 | | 3,184,594 | | Dylan Smith | | | 04/03/2014(2) | | 140,000 | | — | | 17.85 | | 04/03/2024 | | — | | — | | — | | — | | | Dylan Smith | | | 02/07/2013(2) | | 140,000 | | — | | — | | 4.63 | | 02/07/2023 | | — | | — | | | 01/02/2015(2) | | 120,000 | | — | | 14.05 | | 01/02/2025 | | — | | — | | — | | — | | | 04/03/2014(2) | | 140,000 | | — | | — | | 17.85 | | 04/03/2024 | | — | | — | | | 06/18/2015(2) | | 34,000 | | — | | 17.52 | | 06/18/2025 | | — | | — | | — | | — | | | 01/02/2015(2) | | 120,000 | | — | | — | | 14.05 | | 01/02/2025 | | — | | — | | | 04/09/2017(2) | | 450,000 | | — | | 16.68 | | 04/09/2027 | | — | | — | | — | | — | | | 06/18/2015(2) | | 34,000 | | — | | — | | 17.52 | | 06/18/2025 | | — | | — | | | 04/03/2019(3) | | 287,500 | | 12,500 | | 20.12 | | 04/03/2029 | | — | | — | | — | | — | | | 04/09/2017(2) | | 450,000 | | | | | | 16.68 | | 04/09/2027 | | — | | — | | | 04/03/2020(4) | | — | | — | | — | | — | | 62,500 | | 1,999,375 | | — | | — | | | 04/10/2018(3) | | | | | | 250,000 | | 20.28 | | 04/10/2018 | | | | | | | 04/02/2021(5) | | — | | — | | — | | — | | 98,438 | | 3,149,032 | | — | | — | | | 04/03/2019(4) | | — | | — | | 300,000 | | 20.12 | | 04/03/2029 | | — | | — | | | 04/04/2022(6) | | — | | — | | — | | — | | 67,032 | | 2,144,354 | | — | | — | | | 04/03/2020(5) | | — | | — | | — | | — | | — | | 112,500 | | 2,939,625 | | | 04/04/2022(7) | | — | | — | | — | | — | | — | | — | | 87,268 | | 2,791,703 | | | 04/02/2021(6) | | — | | — | | — | | — | | — | | 142,188 | | 3,715,372 | | |
(1)
| This column represents the market value of the shares underlying the RSUs as of January 31, 2022,2023, based on the closing price of our Class A common stock, as reported on the New York Stock Exchange, of $26.13$31.99 per share on January 31, 2022,2023, the last trading day of fiscal year 2022.2023. |
(2)
| The stock option is fully vested and exercisable. |
(3)
| One fourth of the shares subject to the option were scheduled to vest on March 20, 2019, and one forty-eighth of the shares were scheduled to vest monthly thereafter, subject to both (i) continued service to Box through each applicable vesting date, and (ii) prior to April 11, 2022, the closing stock price of our Class A common stock having closed at or above $28.00 for 30 consecutive trading days. The performance metric was not met by April 11, 2022 and as a result, the option was forfeited without any shares vesting.
|
(4)
| One fourth of the shares subject to the option vested on March 20, 2020 and one forty-eighth of the shares vest monthly thereafter, subject to both (i) continued service to Box through each applicable vesting date, and (ii) the closing stock price of our Class A common stock must have closed at a level 25% higher than the 30-trading day trailing average closing price prior to April 3, 2019, which was $20.49, for 30 consecutive trading days prior to April 4, 2023. If the performance condition in clause (ii) is not met prior to April 4, 2023, then no options will vest and all will be forfeited. The performance condition in clause (ii) has been satisfied. |
(5) (4)
| One sixteenth of the shares underlying the RSUs vested on June 20, 2020 and one sixteenth of the shares vest quarterly thereafter, subject to continued service to us. |
(6) (5)
| One sixteenth of the shares underlying the RSUs vested on June 20, 2021 and one sixteenth of the shares vest quarterly thereafter, subject to continued service to us. |
(6)
| One sixteenth of the shares underlying the RSUs vested on June 20, 2022 and one sixteenth of the shares vest quarterly thereafter, subject to continued service to us. |
(7)
| The number of PSUs earned per the applicable grant was determined by our Compensation Committee after our fiscal year end on March 22, 2023 based on the company’s achievement of revenue and non-GAAP operating income performance criteria for the fiscal year that ended January 31, 2023. The number of shares shown reflect the actual number of shares determined by our Compensation Committee as earned and eligible for time-based vesting. One third of the shares underlying these PSUs vested on April 4, 2023 and one third of the shares vest annually thereafter, subject to continued service to us. |
TABLE OF CONTENTS Option Exercises and Stock Vested in Fiscal Year 20222023The following table sets forth the number of shares of Class A common stock acquired during our fiscal year 20222023 by our named executive officers upon the exercise of stock options and the vesting of RSU awards and the value realized upon such exercise or vesting. | | | | Options Awards | | Stock Awards | | | | | Options Awards | | Stock Awards | | | Name | | Number of
Shares
Acquired on
Exercise (#) | | Value Realized
on Exercise
($)(1) | | Number of
Shares
Acquired on
Vesting (#) | | Value Realized
on Vesting
($)(2) | | Name | | Number of
Shares
Acquired on
Exercise (#) | | Value Realized
on Exercise
($)(1) | | Number of
Shares
Acquired on
Vesting (#) | | Value Realized
on Vesting
($)(2) | | | Aaron Levie | | 25,000 | | 592,000 | | 4,503 | | 103,389 | | Aaron Levie | | 2,000,000 | | 46,186,800 | | 3,898 | | 112,301 | | | Stephanie Carullo | | — | | — | | 106,130 | | 2,543,929 | | Stephanie Carullo | | — | | — | | 90,823 | | 2,472,219 | | | Dylan Smith | | 397,362 | | 9,321,978 | | 92,067 | | 2,232,028 | | Dylan Smith | | 140,000 | | 3,803,800 | | 117,229 | | 3,187,862 | |
(1)
| The value realized on exercise is the difference between the market price of the shares of our Class A common stock underlying the options when exercised and the applicable exercise price. |
(2)
| Calculated by multiplying (i) the fair market value of our Class A common stock on the date of vesting, date, which was determined using the closing price on the New York Stock Exchange of a share of our Class A common stock on the date of vesting, or if such day is a holiday, on the immediately preceding trading day, by (ii) the number of shares of our Class A common stock acquired upon vesting. |
Pension Benefits and Nonqualified Deferred Compensation We did not provide any defined benefit pension plans or nonqualified deferred compensation plans during our fiscal year ended January 31, 2022.2023. Potential Payments upon Termination or Change in Control We have entered into change of control and severance agreements (“change in control agreements”) with our named executive officers, which require us to make specific payments and benefits in connection with the termination of such named executive officers’ employment under certain circumstances. These change in control agreements superseded any other agreement or arrangement relating to severance benefits with these named executive officers or any terms of their option agreements related to vesting acceleration or other similar severance-related terms. The descriptions that follow describe such payments and benefits that may be owed by us to each of our named executive officers upon the named executive officer’s termination under certain circumstances, pursuant to the named executive officer’s change in control agreement. The change in control agreements will remain in effect for an initial term of three years. At the end of the initial term, each agreement will automatically renew for an additional one-year period unless either party provides notice of nonrenewal within 90 days prior to the date of the automatic renewal. The change in control agreements also acknowledge that each of these named executive officers is an at-will employee, whose employment can be terminated at any time. In order to receive the severance benefits described below, each of these named executive officers is obligated to execute a release of claims against us, provided such release of claims becomes effective and irrevocable no later than 60 days following such named executive officer’s termination date, and to continue to comply with the terms of the named executive officer’s confidential information and intellectual property assignment agreement with us. In the event of a termination of employment without “cause” (as generally defined below) outside of the “change in control period” (as generally defined below), such named executive officer will receive the following: a lump-sum payment of base salary for six months; and paid COBRA benefits for six months. TABLE OF CONTENTS In the event of a termination of employment without “cause” or a resignation for “good reason” (as generally defined below) during the “change in control period,” such named executive officer will receive the following: a lump-sum payment of 12 months of base salary; a lump-sum payment equal to 100% of his or her target bonus; paid COBRA benefits for 12 months; and 100% acceleration of equity awards. In the event any payment to one of these named executive officers is subject to the excise tax imposed by Section 4999 of the Code (as a result of a payment being classified as a “parachute payment” under Section 280G of the Code), the named executive officer will be entitled to receive such payment as would entitle the named executive officer to receive the greatest after-tax benefit of either the full payment or a lesser payment which would result in no portion of such severance benefits being subject to excise tax. For the purpose of the change in control agreements, “cause” means generally the occurrence of any of the following: an act of dishonesty by the named executive officer in connection with the named executive officer’s responsibilities as an employee; the named executive officer’s conviction of, or entry of a plea of guilty or nolo contendere to, a felony or any crime involving fraud or embezzlement; the named executive officer’s gross misconduct; the unauthorized use or disclosure by the named executive officer of our proprietary information or trade secrets or those of any other party to whom the named executive officer owes an obligation of nondisclosure as a result of the named executive officer’s relationship with us; the named executive officer’s willful breach of any obligations under any written agreement or covenant with us; the named executive officer’s failure to cooperate with an investigation by a governmental authority; or the named executive officer’s continued failure to perform his or her duties after notice and a cure period. For the purpose of the change in control agreements with Messrs. Levie and Smith, “good reason” means generally the named executive officer’s voluntary termination of employment following the expiration of any cure period following the occurrence of one or more of the following without the named executive officer’s consent: a material reduction of the named executive officer’s duties, authorities or responsibilities other than a reduction following a change in control where the named executive officer assumes similar functional duties for a stand-alone business unit due to the company becoming part of a larger entity; provided that a reduction resulting from the company not being a stand-alone business unit following a change in control will affirmatively be grounds for good reason; a material reduction of the named executive officer’s base salary; or a material change in the geographic location of the named executive officer’s primary work facility or location. For the purpose of the change in control agreement with Ms. Carullo, “good reason” means generally the named executive officer’s voluntary termination of employment following the expiration of any cure period following the occurrence of one or more of the following without the named executive officer’s consent: a material reduction of the named executive officer’s duties, authorities or responsibilities other than a reduction following a change in control due to the company being part of a larger entity where the named executive officer assumes similar functional duties; a material reduction of the named executive officer’s base salary; or a material change in the geographic location of the named executive officer’s primary work facility or location. For the purpose of the change in control agreements, “change in control period” means generally the period beginning three months prior to, and ending 12 months following, a change in control of the company. In addition, under these arrangements, a change in control is generally defined as a change in more than 50% of the total voting power of our stock, certain changes in the majority composition of the Board of Directors during a 12-month period, or a change in the ownership of a substantial portion of the company’s assets. TABLE OF CONTENTS The following table provides information concerning the estimated payments and benefits that would be provided in the circumstances described above for each of the named executive officers serving as of the end of fiscal year 20212023 pursuant to the change in control agreements in effect at that time. Payments and benefits are estimated assuming that the triggering event took place on the last business day of our fiscal year ended January 31, 2021,2023, and the price per share of our Class A common stock is the closing price of the New York Stock Exchange as of that date. There can be no assurance that a triggering event would produce the same or similar results as those estimated below if such event occurs on any other date or at any other price, or if any other assumption used to estimate potential payments and benefits is not correct. Due to the number of factors that affect the nature and amount of any potential payments of benefits, any actual payments and benefits may be different. | Executive | | Payment Elements | | Termination
Without Cause
or Termination
for Good
Reason Within
Change in Control
Period ($) | | Termination
Without Cause
Outside of
Change in Control
Period ($) | | Executive | | Payment Elements | | Termination
Without Cause
or Termination
for Good
Reason Within
Change in Control
Period ($) | | Termination
Without Cause
Outside of
Change in Control
Period ($) | | | Aaron Levie | | | Salary | | 180,000 | | 90,000 | | Aaron Levie | | | Salary | | 180,000 | | 90,000 | | | Bonus | | 99,000 | | — | | | Bonus | | 99,000 | | — | | | Stock Options(1) | | 2,340,000 | | — | | | Stock Options(1) | | — | | — | | | Stock Awards(2) | | — | | — | | | Stock Awards(2) | | — | | — | | | Health Coverage(3) | | 28,703 | | 14,351 | | | Health Coverage(3) | | 30,199 | | 15,099 | | | Total | | 2,647,703 | | 104,351 | | | Total | | 309,199 | | 105,099 | | | Stephanie Carullo | | | Salary | | 370,000 | | 185,000 | | Stephanie Carullo | | | Salary | | 400,000 | | 200,000 | | | Bonus | | 203,500 | | — | | | Bonus | | 215,875 | | — | | | Stock Options(1) | | 1,202,000 | | — | | | Stock Options(1) | | 98,925 | | — | | | Stock Awards(2) | | 5,021,872 | | — | | | Stock Awards(2) | | 8,297,438 | | — | | | Health Coverage(3) | | 16,103 | | 8,051 | | | Health Coverage(3) | | 21,598 | | 10,799 | | | Total | | 6,813,475 | | 193,051 | | | Total | | 9,033,836 | | 210,799 | | | | | Salary | | 370,000 | | 185,000 | | Dylan Smith | | | Salary | | 425,000 | | 212,500 | | | Dylan Smith | | | Bonus | | 203,500 | | — | | | Bonus | | 226,188 | | — | | | Stock Options(1) | | 3,265,500 | | — | | | Stock Options(1) | | 148,375 | | — | | | Stock Awards(2) | | 6,654,998 | | — | | | Stock Awards(2) | | 9,931,935 | | — | | | Health Coverage(3) | | 29,070 | | 14,535 | | | Health Coverage(3) | | 30,590 | | 15,295 | | | Total | | 10,523,068 | | 199,535 | | | Total | | 10,762,088 | | 227,795 | |
(1)
| Value represents the estimated benefit amount of unvested stock options (including the performance-based options forfeited in April 2022 due to failure to achieve the applicable performance metric) calculated by multiplying the number of unvested stock options subject to acceleration held by the applicable named executive officer by the difference between the exercise price of the option and the closing price of our Class A common stock on the New York Stock Exchange on January 31, 2022,2023, which was $26.13$31.99 per share. Does not reflect any dollar value associated with the acceleration of unvested stock options with exercise prices in excess of $26.13$31.99 per share. The dollar value of the acceleration of stock options (excluding such forfeited options) is zero for Mr. Levie, $1,202,000 for Ms. Carullo, and $1,803,000 for Mr. Smith. |
(2)
| Value represents the estimated benefit amount of unvested RSUs and PSUs calculated by multiplying the number of RSUs and PSUs subject to acceleration held by the applicable named executive officer by the closing price of our Class A common stock on the New York Stock Exchange on January 31, 2022,2023, which was $26.13$31.99 per share. |
(3)
| Represents 12 months of Box-paid COBRA benefits in the case of termination without cause or a termination of employment for good reason within the change in control period and six months of Box-paid COBRA benefits in the case of a termination of employment without cause outside of the change in control period. |
TABLE OF CONTENTS Under SEC rules, we are required to provide the following information regarding the relationship between the annual total compensation of Mr. Levie, our Chief Executive Officer, and the median annual total compensation of our employees (other than Mr. Levie) for fiscal year 2022:2023: Mr. Levie’s annual total compensation, as reported in the “Summary Compensation Table for Fiscal Year 2022”2023” table included in this Proxy Statement,proxy statement, was $292,514.$273,579. The median of the annual total compensation of all employees (other than Mr. Levie) of the company (including our consolidated subsidiaries) was $196,300.$195,638. Based on the above, for fiscal year 2022,2023, the ratio of Mr. Levie’s annual total compensation to the median of the annual total compensation of all employees was 1.491.4 to 1. We believe that this pay ratio is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K under the Securities Act of 1933, as amended. The medianWe determined the employee used for our fiscal year 2022 analysis is the same employee used for our fiscal year 2021 analysis, who was substituted as described in our proxy statement filed July 6, 2021 forwith the median employee determined with respect toannual total compensation of our fiscal year 2020 analysisemployees, other than Mr. Levie, as of January 31, 2020 by using fiscal year 2020 annualized2023, at which time we had approximately 2,487 full-time and part-time regular employees globally, approximately 72% of whom are U.S.-based employees, and approximately 28% of whom are located outside of the United States. To determine the median annual total compensation, we compared the base salaries, bonuses earned, commissions earned and equity compensation. We are usingcompensation of these employees (other than Mr. Levie) to determine the same median employee because there have been no changes in our employee population or employee compensation arrangements that we believe would significantly impactfor fiscal year 2023, with base salaries annualized for employees employed by the pay ratio. Suchcompany for less than a year. The median employee’s annual total compensation disclosed above was determined in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K, yielding the median annual total compensation disclosed above. With respect to the annual total compensation of Mr. Levie, we used the amount reported in the “Total Compensation” column in the “Summary Compensation Table for Fiscal Year 2022”2023” table included in this Proxy Statement.proxy statement.
TABLE OF CONTENTS Pay-Versus-Performance As required by Section 952(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(v) of Regulation S-K, we are providing the following information about the relationship between executive “compensation actually paid” and certain measures of company performance for each of the last three completed fiscal years. The material that follows is provided in compliance with these rules, however, additional information regarding our compensation philosophy, the structure of our performance-based compensation programs, and compensation decisions made this year is described above in our “Compensation Discussion and Analysis.” In determining the “compensation actually paid” to our named executive officers (or “NEOs”), we are required to make various adjustments to amounts that have been previously reported in the Summary Compensation Table as the SEC’s rules for this disclosure differ from those required in the Summary Compensation Table. For our NEOs other than our principal executive officer (the “PEO”), amounts disclosed are reported as an average. | 2023 | | | 273,579 | | | (721,895) | | | 5,219,219 | | | 7,241,777 | | | 213 | | | 142 | | | 26,783,000 | | | 228,978,000 | | | 2022 | | | 292,514 | | | 248,240 | | | 4,499,801 | | | 7,923,836 | | | 174 | | | 183 | | | (41,459,000) | | | 173,422,000 | | | 2021 | | | 288,244 | | | 24,643 | | | 2,937,347 | | | 3,691,476 | | | 115 | | | 146 | | | (43,433,000) | | | 118,842,000 | |
(1)
| Our PEO for each year reported is Aaron Levie, our Chief Executive Officer. The dollar amounts reported in this column are the amounts of total compensation reported for Mr. Leive in the “Total” column of the Summary Compensation Table in the applicable fiscal year. |
(2)
| Compensation actually paid does not mean that our PEO was actually paid those amounts in the listed year, but this is a dollar amount derived from the starting point of Summary Compensation Table total compensation under the methodology prescribed under the SEC’s rules as shown in the adjustment table below. In accordance with SEC rules, the following adjustments were made to determine the compensation actually paid to our PEO during fiscal years 2023, 2022 and 2021, which consisted solely of adjustments to the PEO’s equity awards: |
| Summary Compensation Table – Total Compensation for PEO ($) | | | 273,579 | | | 292,514 | | | 288,244 | | | Subtract grant date fair value of equity awards in Summary Compensation Table ($) | | | (43,775) | | | (112,301) | | | (108,027) | | | Add year end fair value of equity awards granted during year that are outstanding and unvested at fiscal year end ($)* | | | — | | | — | | | — | | | Adjust for year over year change in fair value of outstanding and unvested equity awards granted in prior years ($) | | | — | | | (40,000) | | | (208,000) | | | Add fair value as of vesting date of equity awards granted and vested in the year ($) | | | 112,301 | | | 108,027 | | | 52,426 | | | Adjust for year over year change in fair value of equity awards granted in prior years that vested in the year ($) | | | — | | | — | | | — | | | Subtract fair value at the end of the prior year of equity awards that failed to meet vesting conditions in the year ($) | | | (1,064,000) | | | — | | | — | | | Total Equity Adjustments (subtotal) ($) | | | (995,474) | | | (44,274) | | | (263,601) | | | Compensation Actually Paid ($) | | | (721,895) | | | 248,240 | | | 24,643 | |
*
| The assumptions used for determining the fair values shown in this table are materially consistent with those used to determine the fair values disclosed as of the grant date of such awards. |
(3)
| The non-PEO NEOs for 2023, 2022 and 2021 are Stephanie Carullo and Dylan Smith. The dollar amounts reported in this column represent the average of the amounts reported for the non-PEO NEOs in the “Total” column of the Summary Compensation Table in the applicable fiscal year. |
TABLE OF CONTENTS (4)
| Compensation actually paid does not mean that that these NEOs were actually paid those amounts in the listed year, but this is a dollar amount derived from the starting point of Summary Compensation Table total compensation under the methodology prescribed under the SEC’s rules as shown in the adjustment table below. |
| Summary Compensation Table – Total Compensation non-PEO NEOs | | | 5,219,219 | | | 4,499,801 | | | 2,937,347 | | | Subtract grant date fair value of equity awards in Summary Compensation Table ($) | | | (4,706,153) | | | (4,129,172) | | | (2,566,902) | | | Add year end fair value of equity awards granted during year that are outstanding and unvested at fiscal year end ($)* | | | 4,711,703 | | | 3,449,983 | | | 2,289,426 | | | Adjust for year over year change in fair value of outstanding and unvested equity awards granted in prior years ($) | | | 881,654 | | | 2,618,463 | | | 139,508 | | | Add fair value as of vesting date of equity awards granted and vested in the year ($) | | | 626,744 | | | 968,403 | | | 683,250 | | | Adjust for year over year change in fair value of equity awards granted in prior years that vested in the year ($) | | | 841,110 | | | 516,358 | | | 208,847 | | | Subtract fair value at the end of the prior year of equity awards that failed to meet vesting conditions in the year ($) | | | (332,500) | | | — | | | — | | | Total Equity Adjustments (subtotal) ($) | | | 2,022,558 | | | 3,424,035 | | | 754,129 | | | Compensation Actually Paid ($) | | | 7,241,777 | | | 7,923,836 | | | 3,691,476 | |
*
| The assumptions used for determining the fair values shown in this table are materially consistent with those used to determine the fair values disclosed as of the grant date of such awards. |
(5)
| Total shareholder return is calculated by assuming that a $100 investment was made on the day prior to the first fiscal year reported below and reinvesting all dividends until the last day of each reported fiscal year. |
(6)
| The peer group used is the NASDAQ Computer Index, as used in the company's performance graph in our Annual Report on Form 10-K. Total shareholder return is calculated by assuming that a $100 investment was made on the day prior to the first fiscal year reported below and reinvesting all dividends until the last day of each reported fiscal year. |
(7)
| The dollar amounts reported represent the amount of net income reflected in our audited financial statements for the applicable year. |
(8)
| In the company’s assessment, non-GAAP operating income is the financial performance measure that is the most important financial measure used by the company in fiscal 2023 to link compensation actually paid to performance. The dollar amounts reported reflect the amount of non-GAAP operating income for the applicable year. |
Compensation Actually Paid and Total Shareholder Return Our Compensation Committee makes executive compensation decisions independent of SEC disclosure requirements. For a discussion of our decision-making process, please see the “Compensation Discussion and Analysis” section above. The following graph reflects the relationship between the PEO and average non-PEO NEO “compensation actually paid” (“CAP”), our cumulative Total Shareholder Return (“TSR”) and the TSR of the NASDAQ Computer Index (“Peer TSR”), assuming an initial fixed investment on January 31, 2020 of $100, for the fiscal years ended January 31, 2023, 2022 and 2021. TABLE OF CONTENTS Compensation Actually Paid and Net Income The following graph reflects the relationship between the PEO and average non-PEO NEO CAP, and our net income (loss) for the fiscal years ended January 31, 2023, 2022 and 2021. While we are required by SEC rules to disclose the relationship between our net income and “compensation actually paid” to our NEOs, this is not a metric our Compensation Committee currently uses in evaluating our NEOs’ compensation. Compensation Actually Paid and Non-GAAP Operating Income The following graph reflects the relationship between the PEO and average non-PEO NEO CAP, and our non-GAAP operating income for the fiscal years ended January 31, 2023, 2022 and 2021. Tabular List of Performance Measures Every year our Board of Directors sets a list of corporate goals as part of our annual business plan. These goals are used to evaluate our performance and the performance of our executive officers. These goals are used in our executive compensation programs, in particular in our annual executive bonus program. The list below includes the three financial performance measures that in our assessment represent the most important financial performance measures used in fiscal year 2023 to link compensation actually paid to company performance. Non-GAAP operating income Non-GAAP net income per share attributable to common stockholders Revenue TABLE OF CONTENTS EQUITY COMPENSATION PLAN INFORMATION The following table summarizes our equity compensation plan information as of January 31, 2022.2023. Information is included for equity compensation plans approved by our stockholders. We do not have any equity compensation plans not approved by our stockholders. | Equity compensation plans approved by stockholders | | | Class A | | | 20,567,806 | | | $11.74 | | | 34,107,340 | | | Equity compensation plans not approved by stockholders | | | | | | — | | | — | | | — | | | Total | | | Class A | | | 20,567,806 | | | $11.74 | | | 34,107,340 | |
| Equity compensation plans approved by stockholders | | | Class A | | | 17,038,816 | | | $17.32 | | | 35,984,166 | | | Equity compensation plans not approved by stockholders | | | | | | — | | | — | | | — | | | Total | | | Class A | | | 17,038,816 | | | $17.32 | | | 35,984,166 | |
(1)
| The weighted average exercise price is calculated based solely on outstanding stock options. It does not take into account the shares of our common stock underlying RSUs, which have no exercise price. |
(2)
| Includes: 26,828,44530,692,156 shares from the Box, Inc. 2015 Equity Incentive Plan (2015 Plan) and 7,278,8955,292,010 shares from the Box, Inc. 2015 Employee Stock Purchase Plan (ESPP). Our 2015 Plan provides that on the first day of each fiscal year, the number of shares of Class A common stock available for issuance thereunder is automatically increased by a number equal to the least of (i) 12,200,000 shares, (ii) 5% of the outstanding shares of our capital stock as of the last day of our immediately preceding fiscal year, or (iii) such other amount as our Board of Directors may determine. On February 1, 2022,2023, the number of shares of Class A common stock available for issuance under our 2015 Plan increased by 7,278,4477,215,052 pursuant to the provision. The increase is not reflected in the table above. Our ESPP evergreen provision was eliminated and a one-time increase of 6,000,000 shares was approved by the Company’s stockholders at our annual meeting held on September 9, 2021. |
TABLE OF CONTENTS SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The table on the following page sets forth certain information with respect to the beneficial ownership of our capital stock as of May 1, 20222023 for: each person or group of affiliated persons known by us to be the beneficial owner of more than 5% of our Class A common stock or Series A Preferred Stock; each of our named executive officers; each of our directors; and all of our current executive officers and directors as a group. We have determined beneficial ownership in accordance with the rules and regulations of the SEC, and thus it represents sole or shared voting or investment power with respect to our securities. Unless otherwise indicated below, to our knowledge, the persons and entities named in the table have sole voting and sole investment power with respect to all shares that they beneficially owned, subject to applicable community property laws. Applicable percentage ownership is based on 145,598,135144,854,960 shares of our Class A common stock outstanding as of May 1, 2022.2023. In computing the number of shares of capital stock beneficially owned by a person and the percentage ownership of such person, we deemed to be outstanding all shares of our capital stock subject to options held by the person that are currently exercisable or exercisable within 60 days of May 1, 20222023 and issuable upon the vesting of RSUs held by the person within 60 days of May 1, 2022.2023. However, we did not deem such shares of our capital stock outstanding for the purpose of computing the percentage ownership of any other person. There were 500,000 shares of our Series A Preferred Stock outstanding as of May 1, 2022.2023. Unless otherwise indicated, the address of each beneficial owner listed in the table below is c/o Box, Inc., 900 Jefferson Ave., Redwood City, California 94063. The information provided in the table is based on our records, information filed with the SEC and information provided to us, except where otherwise noted. TABLE OF CONTENTS | 5% Stockholders: | | | | | | | | | | | | | | | The Vanguard Group, Inc.(1) | | | 16,338,287 | | | 11.2% | | | — | | | — | | | BlackRock, Inc.(2) | | | 12,972,191 | | | 8.9% | | | — | | | — | | | Entities Affiliated with KKR(3) | | | — | | | — | | | 149,999 | | | 30.0% | | | Entities Affiliated with Centerbridge(4) | | | — | | | — | | | 116,667 | | | 23.3% | | | Kennedy Lewis Capital Partners Master Fund II L.P(5) | | | — | | | — | | | 116,667 | | | 23.3% | | | Oak Hill Advisor Entities(6) | | | — | | | — | | | 116,667 | | | 23.3% | | |
| | | | | | | | | | | | | | | Named Executive Officers and Directors: | | | | | | | | | | | | | | | Aaron Levie | | | 3,225,186 | | | 2.2% | | | — | | | — | | | Dylan Smith(7) | | | 2,319,908 | | | 1.6% | | | — | | | — | | | Stephanie Carullo(8) | | | 783,437 | | | * | | | — | | | — | | | Sue Barsamian(9) | | | 53,149 | | | * | | | — | | | — | | | Dana Evan(10) | | | 176,819 | | | * | | | — | | | — | | | Kim Hammonds | | | — | | | — | | | — | | | — | | | Jack Lazar(11) | | | 34,304 | | | * | | | — | | | — | | | Peter Leav(12) | | | 45,943 | | | * | | | — | | | — | | | Dan Levin(13) | | | 869,295 | | | * | | | — | | | — | | | Bethany Mayer | | | 19,492 | | | * | | | — | | | — | | | John Park | | | — | | | — | | | — | | | — | | | All executive officers and directors as a group
(11 persons)(14) | | | 7,527,533 | | | 5.2% | | | — | | | — | |
| 5% Stockholders:
| | | | | | | | | | | | | | | The Vanguard Group, Inc.(1) | | | 14,950,700 | | | 10.3% | | | — | | | — | | | BlackRock, Inc.(2) | | | 14,667,787 | | | 10.1% | | | — | | | — | | | Entities Affiliated with KKR(3) | | | — | | | — | | | 149,999 | | | 30.0% | | | Entities Affiliated with Centerbridge(4) | | | — | | | — | | | 116,667 | | | 23.3% | | | Kennedy Lewis Capital Partners Master Fund II L.P(5) | | | — | | | — | | | 116,667 | | | 23.3% | | | Oak Hill Advisor Entities(6) | | | — | | | — | | | 116,667 | | | 23.3% | | | | | | | | | | | | | | | | | | Named Executive Officers and Directors:
| | | | | | | | | | | | | | | Aaron Levie | | | 3,088,653 | | | 2.1% | | | — | | | — | | | Dylan Smith(7) | | | 2,356,595 | | | 1.6% | | | — | | | — | | | Stephanie Carullo(8) | | | 891,648 | | | * | | | — | | | — | | | Sue Barsamian(9) | | | 68,871 | | | * | | | — | | | — | | | Dana Evan(10) | | | 177,845 | | | * | | | — | | | — | | | Jack Lazar(11) | | | 58,221 | | | * | | | — | | | — | | | Dan Levin(12) | | | 478,677 | | | * | | | — | | | — | | | Bethany Mayer(13) | | | 52,913 | | | * | | | — | | | — | | | John Park | | | — | | | — | | | — | | | — | | | Amit Walia | | | — | | | — | | | — | | | — | | | All executive officers and directors as a group (10 persons)(14) | | | 7,173,423 | | | 4.9% | | | — | | | — | |
*
| Represents beneficial ownership of less than one percent (1%). |
+
| None of the holders of Series A Preferred Shares beneficially owns more than 5% of the Class A Shares. |
(1)
| According to a Schedule 13G/A filed with the SEC on February 9, 2022,2023, The Vanguard Group, Inc. (“Vanguard”), as investment advisor, has sole voting power with respect to none of the reported shares, shared voting power with respect to 271,239238,499 of the reported shares, sole dispositive power with respect to 15,932,57514,569,113 of the reported shares and shared dispositive power with respect to 405,712381,587 of the reported shares. The address of Vanguard is 100 Vanguard Blvd., Malvern, Pennsylvania 19355. |
(2)
| According to a Schedule 13G/A filed with the SEC on February 7, 2022,14, 2023, BlackRock, Inc. (“BlackRock”), has sole voting power with respect to 12,492,79814,212,452 of the reported shares, andshared voting power with respect to none of the reported shares, sole dispositive power with respect to all14,667,787 of the reported shares and shared dispositive power with respect to none of the reported shares. BlackRock’s address is 55 East 52nd Street, New York, New York, 10055. |
(3)
| Represents 113,240 shares held by Powell Investors III L.P., 20,293 shares held by Tailored Opportunistic Credit Fund, 7,379 shares held by KKR-NYC Credit C L.P., 6,088 shares held by KKR-Milton Credit Holdings L.P. and 2,999 shares held by CPS Holdings (US) L.P. As of May 1, 2022,2023, the Series A Preferred Shares held by these KKR-affiliated entities are convertible into 5,555,510 shares of Class A common stock. KKR Special Situations Fund III Limited is the general partner of Powell Investors III L.P. KKR Dislocation Opportunities (EEA) Fund SCSp is the sole shareholder of KKR Special Situations Fund III Limited. KKR Associates Dislocation Opportunities SCSp is the general partner of KKR Dislocation Opportunities (EEA) Fund SCSp. KKR Dislocation Opportunities S.a r.l. is the general partner of KKR Associates Dislocation Opportunities SCSp. KKR Dislocation Opportunities Limited is the sole shareholder of KKR Dislocation Opportunities S.a r.l. KKR-NYC Credit C GP LLC is the general partner of KKR-NYC Credit C L.P. KKR-NYC SL GP MH LLC is the sole member of KKR-NYC Credit C GP LLC. KKR Associates Milton Strategic L.P. is the general partner of KKR-Milton Credit Holdings L.P. KKR Milton Strategic Limited is the general partner of KKR Associates Milton Strategic L.P. CPS Holdings (US) GP LLC is the general partner of CPS Holdings (US) L.P. CPS Managers Fund (US) L.P. is the sole member of CPS Holdings (US) GP LLC. CPS Associates (US) L.P. is the general partner of CPS Managers Fund (US) L.P. CPS (US) LLC is the general partner of CPS Associates (US) L.P. KKR Credit Fund Advisors LLC is an investment advisor to Powell Investors III L.P. and KKR-NYC Credit C L.P. and is a wholly-owned subsidiary of KKR Credit Advisors (US) LLC., which, along with KKR Australia Investment Management Pty Limited, is the investment advisor to Tailored Opportunistic Credit Fund and KKR-Milton Credit Holdings L.P. KKR Australia Pty Limited is the sole shareholder of KKR Australia Investment Management Pty Limited. KKR Asia LLC is the sole shareholder of KKR Australia Pty Limited. Kohlberg Kravis Roberts & Co. L.P. is the holder of all of the outstanding equity interests in KKR Credit Advisors (US) LLC and KKR Asia LLC and is the investment advisor to CPS Managers Fund (US) L.P. KKR & Co. GP LLC is the general partner of Kohlberg Kravis Roberts & Co. L.P. KKR Holdco LLC is the sole member of KKR & Co. GP LLC. KKR Group Partnership L.P. is the sole shareholder of each of KKR Dislocation Opportunities Limited and KKR Milton Strategic Limited and the sole member of each of KKR-NYC SL GP MH LLC, CPS (US) LLC and KKR Holdco LLC. KKR Group Holdings Corp. is the general partner of KKR Group Partnership L.P. KKR & Co. Inc. is the sole shareholder of KKR Group Holdings Corp. KKR Management LLP is the Series I preferred stockholder of KKR & Co. Inc. Messrs. Henry R. Kravis and George R. Roberts are the founding partners of KKR Management LLP. The principal business address of each of the entities and persons identified above, other than Kohlberg Kravis Roberts & Co. L.P., KKR & Co. GP LLC, KKR Holdco LLC, KKR Group Partnership L.P., KKR Group Holdings Corp., KKR & Co. Inc., KKR Management LLP and Messrs. Kravis and Roberts is |
TABLE OF CONTENTS 555 California Street, 50th Floor, San Francisco, CA 94104, the principal business address of the other entities and Mr. Kravis is c/o Kohlberg Kravis Roberts & Co. L.P., 30 Hudson Yards, New York, NY 10001 and the principal business address of Mr. Roberts is c/o Kohlberg Kravis Roberts & Co. L.P., 2800 Sand Hill Road, Suite 200, Menlo Park, CA 94025. (4)
| Represents 25,167 shares held by Centerbridge Credit Partners Master, L.P. and 91,500 shares held by Centerbridge Special Credit Partners III-Flex, L.P. As of May 1, 2022,2023, the Series A Preferred Shares held by these Centerbridge-affiliated entities are convertible into 4,320,995 shares of Class A common stock. Centerbridge Credit GP Investors, L.L.C. (“Credit GP Investors”) is the sole director of Centerbridge Credit Cayman GP, Ltd. (“Credit Cayman GP”), which is the general partner of Centerbridge Credit Partners Offshore General Partner, L.P. (“Credit Partners Offshore GP”), which is the general partner of Centerbridge Credit Partners Master, L.P. (“Credit Partners Master”), and may be deemed to share beneficial ownership over the securities held of record by Credit Partners Master. As the managing member of Credit GP Investors, Jeffrey H. Aronson may be deemed to share beneficial ownership with respect to the securities held of record by Credit Partners Master. Such persons and entities expressly disclaim beneficial ownership of the securities held of record by Credit Partners Master, except to the extent of any proportionate pecuniary interest therein. The address of each of Credit GP Investors, Credit Cayman GP, Credit Partners Offshore GP, Credit Partners Master and Mr. Aronson, respectively, is 375 Park Avenue, 11th Floor, New York, New York 10152. CSCP III Cayman GP Ltd. (“CSCP III Cayman GP”) is the general partner of Centerbridge Special Credit Partners General Partner III, L.P. (“Special Credit III GP”), which is the general partner of Centerbridge Special Credit Partners III-Flex, L.P. (“SC III-Flex”), and may be deemed to share beneficial ownership over the securities held of record by SC III-Flex. As the director of CSCP III Cayman GP, Jeffrey H. Aronson may be deemed to share beneficial ownership with respect to the securities held of record by SC III-Flex. Such persons and entities expressly disclaim beneficial ownership of the securities held of record by SC III-Flex, except to the extent of any proportionate pecuniary interest therein. The address of each of CSCP III Cayman GP, Special Credit III GP, SC III-Flex and Mr. Aronson, respectively, is 375 Park Avenue, 11th Floor, New York, New York 10152. |
(5)
| As of May 1, 2022,2023, the Series A Preferred Shares held by Kennedy Lewis Capital Partners Master Fund II L.P. are convertible into 4,320,995 shares of Class A common stock. Kennedy Lewis GP II LLC is the general partner of Kennedy Lewis Capital Partners Master Fund II L.P. and Kennedy Lewis Management LP is the Investment Advisor of Kennedy Lewis Capital Partners Master Fund II L.P. and share voting and investment control with respect to the securities held of record by Kennedy Lewis Capital Partners Master Fund II L.P. Darren Richman and David Chene are the principals of Kennedy Lewis GP II LLC and Kennedy Lewis Management LP. The address of Kennedy Lewis Capital Partners Master Fund II L.P. is 111 West 33rd Street, Suite 1910, New York, NY 10120. |
(6)
| Interests shown are held by entities advised and/or managed by Oak Hill Advisors, L.P. or its affiliate (each, an “Oak Hill Advisors Entity”). Interests shown consists of 900 shares held by ALOHA European Credit Fund, L.P., 2,800 shares held by Future Fund Board of Guardians, 900 shares held by Illinois State Board of Investment, 1,400 shares held by Indiana Public Retirement System, 2,800 shares held by OHA AD Customized Credit Fund (International), L.P., 4,100 shares held by OHA Artesian Customized Credit Fund I, L.P., 700 shares held by OHA BCSS SSD II, L.P., 8,800 shares held by OHA Black Bear Fund, L.P., 5,300 shares held by OHA Centre Street Partnership, L.P., 8,800 shares held by OHA Credit Solutions Master Fund II SPV, L.P., 6,500 shares held by OHA Delaware Customized Credit Fund Holdings, L.P., 1,100 shares held by OHA Delaware Customized Credit Fund-F, L.P., 5,900 shares held by OHA Dynamic Credit ORCA Fund, L.P., 800 shares held by OHA Enhanced Credit Strategies Master Fund, L.P., 5,200 shares held by OHA KC Customized Credit Master Fund, L.P., 800 shares held by OHA MPS SSD II, L.P., 4,200 shares held by OHA SA Customized Credit Fund, L.P., 21,500 shares held by OHA Strategic Credit Master Fund II, L.P., 3,600 shares held by OHA Structured Products Master Fund D, L.P., 28,567 shares held by OHA Tactical Investment Master Fund, L.P., 1,200 shares held by OHAT Credit Fund, L.P. and 800 shares held by The Coca-Cola Company Master Retirement Trust. As of May 1, 2022,2023, the Series A Preferred Shares held by these Oak Hill Advisors entities are convertible into 4,320,984 shares of Class A common stock. The business address for the Oak Hill Advisors Entities is One Vanderbilt Avenue 16th Floor New York, NY 10017. Glenn R. August is the Founder, Senior Partner and Chief Executive Officer of Oak Hill Advisors, L.P. The interests beneficially owned by the Oak Hill Advisors Entities may also be deemed to be beneficially owned by Mr. August. Mr. August disclaims beneficial ownership of our Series A Preferred Shares beyond his pecuniary interest in the Oak Hill Advisors Entities for purposes of Section 16 under the Exchange Act. |
(7)
| Consists of (i) 1,163,5651,193,846 shares held by Mr. Smith, (ii) 85,000 shares held by Mr. Smith, as Trustee of the DCS GRAT of 2014, (iii) 1,127,7501,044,000 shares subject to options held by Mr. Smith that are exercisable within 60 days of May 1, 20222023 and (iv) 28,59333,749 shares issuable upon the vesting of RSUs within 60 days of May 1, 2022.2023. |
(8)
| Consists of (i) 199,064265,087 shares held by Ms. Carullo, (ii) 562,499600,000 shares subject to options held by Ms. Carullo that are exercisable within 60 days of May 1, 20222023 and (iii) 21,87426,561 shares issuable upon the vesting of RSUs within 60 days of May 1, 2022.2023. |
(9)
| Consists of (i) 24,42332,372 shares held by Ms. Barsamian, and (ii) 28,726 shares subject to options held by Ms. Barsamian that are exercisable within 60 days of May 1, 2022.2023 and (iii) 7,773 shares issuable upon the vesting of RSUs within 60 days of May 1, 2023. |
(10)
| Consists of (i) 119,457112,710 shares held by Ms. Evan, and (ii) 57,362 shares subject to options held by Ms. Evan that are exercisable within 60 days of May 1, 2022.2023 and (iii) 7,773 shares issuable upon the vesting of RSUs within 60 days of May 1, 2023. |
(11)
| Consists of (i) 10,55518,782 shares held by Mr. Lazar, and (ii) 23,74931,666 shares subject to options held by Mr. Lazar that are exercisable within 60 days of May 1, 2022. |
(12)
| Consists of (i) 18,034 shares held by Mr. Leav, (ii) 23,922 shares subject to options held by Mr. Leav that are exercisable within 60 days of May 1, 2022,2023 and (iii) 3,9877,773 shares issuable upon the vesting of RSUs within 60 days of May 1, 2022.2023. |
(13) (12)
| Consists of (i) 21,16629,115 shares held by Mr. Levin, and (ii) 848,129441,789 shares subject to options held by Mr. Levin that are exercisable within 60 days of May 1, 2022. |
(14)
| Consists of (i) 4,800,942 shares outstanding as of May 1, 2022, (ii) 2,672,137 shares subject to options exercisable within 60 days of May 1, 20222023 and (iii) 54,4547,773 shares issuable upon the vesting of RSUs within 60 days of May 1, 2022.2023. |
(13)
| Consists of (i) 41,254 shares held by Ms. Mayer and (ii) 11,659 shares issuable upon the vesting of RSUs within 60 days of May 1, 2023. |
(14)
| Consists of (i) 4,866,819 shares outstanding as of May 1, 2023, (ii) 2,203,543 shares subject to options exercisable within 60 days of May 1, 2023 and (iii) 103,061 shares issuable upon the vesting of RSUs within 60 days of May 1, 2023. |
TABLE OF CONTENTS RELATED PERSON TRANSACTIONS We describe below transactions and series of similar transactions, since the beginning of our last fiscal year, to which we were a party or will be a party, in which: the amounts involved exceeded or will exceed $120,000; and any of our directors, nominees for director, executive officers or beneficial holders of more than 5% of any class of our outstanding capital stock, or any immediate family member of, or person sharing the household with, any of these individuals or entities (each, a related person), had or will have a direct or indirect material interest. On April 7, 2021, the company entered into an Investment Agreement (the “Investment Agreement”) with investment vehicles managed or advised by KKR Credit Advisors (US) LLC, or affiliates thereof.thereof (collectively, “KKR”), relating to the issuance and sale by the company to KKR and certain other parties (collectively with KKR, the “Investors”) of 500,000 shares of Series A Convertible Preferred Stock, par value $0.0001 per share (the “Series A Preferred Stock”) for an aggregate purchase price of $500 million, or $1,000 per share (the “Issuance”). Cumulative preferred dividends accrue daily on the Series A Preferred Stock at a rate of 3.0% per year. The Issuance was consummated on May 12, 2021 (the “Closing Date”) for an aggregate purchase price of $500 million. Our Board of Directors unanimously approved the Investment Agreement and Issuance. As of the Record Date, the Investors held 500,000 shares of Series A Preferred Stock. The holders of our Series A Preferred Stock are entitled to vote with the holders of our Class A common stock on an as-converted basis, voting together as a single class. Holders of the Series A Preferred Stock are also entitled to a separate class vote with respect to, among other things, amendments to the company’s organizational documents that have an adverse effect on the Series A Preferred Stock, authorizations or issuances by the company of securities that are senior to, or equal in priority with, the Series A Preferred Stock, and payments of special dividends in excess of an agreed upon amount. On May 13, 2021, the company waived compliance by the Investors with the provisions of the Investment Agreement requiring the Investors to vote in the same manner as recommended by the Board of Directors with respect to certain proposals, resulting in the Investors being able to vote their shares of Series A Preferred Stock without restriction.
Pursuant to the Investment Agreement, the company agreed to increase the size of its Board of Directors in order to appoint, as of the Closing Date,appointed one individual designated by KKR, who shallwas initially be John Park, to our Board of Directors for a term expiring at the 2023 annual meeting of the company’s stockholders. So long as KKR beneficially owns at least 50% of the shares of Series A Preferred Stock that it purchased at the closing of the Issuance on an as-converted basis, KKR will have the right to designate a director nominee for election to the Board of Directors. In March 2023, KKR designated John Park as a director nominee for re-election at this Annual Meeting. For further information regarding the Investment Agreement, including a description of certain obligations and restrictions binding on the parties thereto and the terms of the Series A Preferred Stock, please refer to the Company’scompany’s Current Reports on Form 8-K filed with the SEC on April 8, 2021 and May 18, 2021. We have entered into change in control and severance agreements with certain of our executive officers that, among other things, provide for certain severance and change in control benefits. See the section titled and “Executive Compensation—Potential Payments upon Termination or Change in Control.” We have entered into indemnification agreements with our directors and executive officers. The indemnification agreements and our Charter and Bylaws require us to indemnify our directors and executive officers to the fullest extent permitted by Delaware law. Other than as described above, since February 1, 2021,2022, we have not entered into any transactions, nor are there any currently proposed transactions, between us and a related party where the amount involved exceeds, or would exceed, $120,000, and in which any related person had or will have a direct or indirect material interest. We believe the terms of the transactions described above were comparable to terms we could have obtained in arm’s-length dealings with unrelated third parties. TABLE OF CONTENTS
Policies and Procedures for Related Party Transactions Our Audit Committee has the primary responsibility for reviewing and approving transactions with related persons. Our Audit Committee charter provides that our Audit Committee shall review any related person transactions. Our Board of Directors has adopted a formal written policy providing that we are not permitted to enter into any transaction that exceeds $120,000 and in which any related person has a direct or indirect material interest without the consent of our Audit Committee. In approving or rejecting any such transaction, our Audit Committee is to consider the relevant facts and circumstances available and deemed relevant to our Audit Committee, including whether the transaction is on terms no less favorable than terms generally available to an unaffiliated third party under the same or similar circumstances and the extent of the related person’s interest in the transaction. The company is not aware of any related person transactions required to be reported under applicable SEC rules since the beginning of the last fiscal year where our policies and procedures did not require review, or where such policies and procedures were not followed. TABLE OF CONTENTS Stockholders Sharing the Same Address The SEC has adopted rules that permit companies and intermediaries (such as brokers and banks) to satisfy the delivery requirements for proxy statements and annual reports with respect to two or more stockholders sharing the same address by delivering a single proxy statement addressed to those stockholders. Once you have received notice from your bank or broker that it will be householding communications to your address, householding will continue until you are notified otherwise or until you revoke your consent. If, at any time, you no longer wish to participate in householding and would prefer to receive a separate proxy statement and annual report, please notify your bank or broker and direct your request to: Box, Inc.
Attention: Investor Relations
900 Jefferson Ave.
Redwood City, California 94063
Tel: (877) 729-4269(650) 209-3463
Stockholders who currently receive multiple copies of this Proxy Statementproxy statement at their address and would like to request householding of their communications should contact their bank or broker. We will make available a list of stockholders of record as of the Record Date for inspection by stockholders for any purpose germane to the Annual Meeting from June 30, 202217, 2023 through July 14, 2022June 26, 2023 at our headquarters located at 900 Jefferson Ave., Redwood City, California 94063. Due to the fact that the normal business hours of our headquarters have been affected due to the COVID-19 pandemic, ifIf you wish to inspect the list, please submit your request, along with proof of ownership, by email to ir@box.com. The list will also be available electronically on the meeting website during the live webcast of the Annual Meeting. Stockholder Proposals and Director Nominations for the 20232024 Annual Meeting of Stockholders Stockholder Proposals Stockholders may present proper proposals for inclusion in our proxy statement and for consideration at next year’s annual meeting of stockholders pursuant to Rule 14a-8 under the Exchange Act by submitting their proposals in writing to our Secretary in a timely manner. For a Rule 14a-8 stockholder proposal to be considered for inclusion in our proxy statement for the 20232024 annual meeting of stockholders, our Secretary must receive the written proposal at our principal executive offices not later than January 27, 2023.16, 2024. In addition, such stockholder proposals must comply with the requirements of Rule 14a-8 under the Exchange Act regarding the inclusion of stockholder proposals in company-sponsored proxy materials. Stockholder proposals should be addressed to: Box, Inc.
Attention: Corporate Secretary
900 Jefferson Ave.
Redwood City, California 94063 TABLE OF CONTENTS
Our Bylaws also establish an advance notice procedure for stockholders who wish to present a proposal before an annual meeting of stockholders but do not intend for the proposal to be included in our proxy statement pursuant to Rule 14a-8 under the Exchange Act. Our Bylaws provide that the only business that may be conducted at an annual meeting of stockholders is business that is (i) specified in our proxy materials with respect to such annual meeting, (ii) otherwise properly brought before such annual meeting by or at the direction of our Board of Directors, or (iii) properly brought before such meeting by a stockholder of record entitled to vote at such annual meeting who has delivered timely written notice to our Secretary at the address set forth above, which notice must contain the information specified in our Bylaws. To be timely for our 20232024 annual meeting of stockholders, our Secretary must receive the written notice at the address set forth above: not earlier than 8:00 a.m. Pacific time on March 13, 2023;1, 2024; and not later than the end of the day5:00 p.m. Pacific time on April 12, 2023.March 31, 2024. TABLE OF CONTENTS In the event that we hold the 20232024 annual meeting of stockholders more than 30 days before or more than 60 days after the one-year anniversary of the Annual Meeting, notice of a stockholder proposal that is not intended to be included in our proxy statement must be received noto our Secretary at the address set forth above not earlier than the close of business8:00 a.m. Pacific time on the 120th day before the 20232024 annual meeting of stockholders and nonot later than the close of business5:00 p.m. Pacific Time on the later of the following two dates: the 90th day prior to the 20232024 annual meeting of stockholders; or the 10th day following the day on which public announcement of the date of our 20232024 annual meeting of stockholders is first made. If a stockholder who has notified us of his, her, or its intention to present a proposal at an annual meeting of stockholders does not appear to present his, her, or its proposal at such annual meeting and otherwise comply with our Bylaws, we are not required to present the proposal for a vote at such annual meeting. Nomination of Director Candidates Holders of our Class A common stock may propose director candidates for consideration by our Nominating and Corporate Governance Committee. Any such recommendations should include the nominee’s name and qualifications for membership on our Board of Directors and should be directed to our Secretary at the address set forth above. For additional information regarding stockholder recommendations for director candidates, see the section titled “Board of Directors and Corporate Governance — Governance—Stockholder Recommendations for Nominations to the Board of Directors” beginning on page 2221 of this Proxy Statement.proxy statement.In addition, our Bylaws permit stockholders to nominate directors for election at an annual meeting of stockholders. To nominate a director, the stockholder must provide the information required by our Bylaws.Bylaws which includes information required by Rule 14a-19 under the Exchange Act. In addition, the stockholder must give timely notice to our Secretary in accordance with our Bylaws, which, in general, require that the notice be received at the address set forth above within the time periods described above under the section titled “Stockholder Proposals” for stockholder proposals that are not intended to be included in a proxy statement. In 2021, our boardBoard of directorsDirectors amended our bylaws to provide our stockholders with proxy access provisions. Under our bylaws, a stockholder, or a group of up to 20 stockholders, owning at least 3% of our outstanding common stock continuously for at least three years, may nominate and include in our proxy materials director nominees constituting up to the greater of two individuals or 20% of our boardBoard of directors,Directors, subject to certain limitations and provided that the stockholders and the nominees satisfy the requirements specified in our Bylaws. To be timely for our 20232024 annual meeting of stockholders, our Secretary must receive the written notice at the address set forth above not earlier than 8:00 a.m. Pacific time on December 28, 202217, 2023 and not later than the end of the day5:00 p.m. Pacific time on January 27, 2023.16, 2024. Availability of Bylaws A copy of our Bylaws is available on our website at http:https://www.box.com/investorswww.boxinvestorrelations.com. You may also contact our Corporate Secretary at the address set forth above for a copy of the relevant Bylaw provisions regarding the requirements for making stockholder proposals and nominating director candidates. Section 16(a) Beneficial Ownership Reporting Compliance Section 16(a) of the Exchange Act requires our officers, directors and holders of more than ten percent of our Class A common stock, to file with the SEC reports regarding their ownership and changes in ownership of our securities. We believe that, during fiscal year 2023, our officers, directors, and ten percent stockholders complied with all Section 16(a) filing requirements. We did however report the following transactions after the deadline: (i) the withholding by Box of 9,059 shares to satisfy its income tax and withholding and remittance obligations in connection with the net settlement of RSUs released to Stephanie Carullo was reported on a Form 4 on July 8, 2022, (ii) the withholding by Box of 14,178 shares to satisfy its income tax and withholding and remittance obligations in connection with the net settlement of RSUs released to Dylan Smith was reported on a Form 4 on July 8, 2022 and (iii) the withholding by Box of 2,970 shares to satisfy its income tax and withholding and remittance obligations in connection with the net settlement of RSUs released to Eli Berkovitch was reported on a Form 4 on July 8, 2022. TABLE OF CONTENTS In making this statement, we have relied upon examination of the copies of Forms 3, 4, and 5, and amendments to these forms provided to us, and the written representations of our executive officers, directors, and ten percent stockholders. Fiscal Year 20222023 Annual Report and SEC Filings Our financial statements for our fiscal year ended January 31, 20222023 are included in our Annual Report on Form 10-K, which we will make available to stockholders at the same time as this Proxy Statement.proxy statement. This Proxy Statementproxy statement and our annual report are posted on our website at http:https://www.box.com/investorswww.boxinvestorrelations.com and are available from the SEC at its website at www.sec.gov. You may also obtain a copy of our annual report without charge by sending a written request to Box, Inc., Attention: Investor Relations, 900 Jefferson Ave., Redwood City, California 94063. Forward-Looking Statements This Proxy Statement,proxy statement, along with the accompanying stockholder letter, contains forward-looking statements within the meaning of Section 27A of the Securities Act, Section 21E of the Exchange Act and the Private Securities Litigation Reform Act of 1995. All statements relating to events or results that may occur in the future, including, but not limited to, statements in the stockholder letter regarding our expectation thatmarket opportunity and business plan, including our roadmap will enable usexpectations regarding future expansion within certain geographic and industry sectors; the competitive positioning of our product portfolio; our expectations regarding new products, features, and integrations with third-party partners as well as potential impacts upon, and benefits provided to, continue our industry leadership going forward and our expectation that we are on track to deliver approximately $1 billion in revenue for fiscal 2023,customers, and underlying assumptions of any of the foregoing are forward-looking statements. When used in this Proxy Statement,proxy statement, terms such as “anticipates,” “believes,” “continue,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “should” or “will” or the negative of those terms or other comparable terms are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause us to fall short of our expectations or may cause us to deviate from our current plans, as expressed or implied by these statements. The known risks that could cause our results to differ, or may cause us to take actions that are not currently planned or expected, are described in the company’s reports and filings with the SEC including, without limitation, the company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2022,2023, under the heading Item 1A – “Risk Factors.” Unless required by law, the company does not intend, and undertakes no obligation, to update or publicly release any revision to any forward-looking statements, whether as a result of the receipt of new information, the occurrence of subsequent events, the change of circumstance or otherwise. Each forward-looking statement contained in this Proxy Statementproxy statement is specifically qualified in its entirety by the aforementioned factors. Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this Proxy Statement.proxy statement. * * * The Board of Directors does not know of any other matters to be presented at the Annual Meeting. If any additional matters are properly presented at the Annual Meeting, the persons named in the enclosed proxy card will have discretion to vote the shares of our Voting Stock they represent in accordance with their own judgment on such matters. It is important that your shares of our Class A common stock and/or Series A Preferred Stock be represented at the Annual Meeting, regardless of the number of shares that you hold. You are, therefore, urged to vote by telephone or by using the Internet as instructed on the enclosed proxy card or execute and return, at your earliest convenience, the enclosed proxy card in the envelope that has also been provided. | | | | THE BOARD OF DIRECTORS
Redwood City, California
May 27, 202215, 2023 | |
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