UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Securities Exchange Act of 1934 (Amendment No. )
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eBay, Inc.
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We connect people and build communities to create economic opportunity for all
At eBay, we create pathways to connect millions of sellers and buyers in more than 190 markets around the | ||||||
Champions of inclusive commerce, eBay Seller School assists sellers in transforming their business, and we help small businesses grow globally, through programs such as eBay for Change and Up & Running.
eBay Foundation | ||||||
eBay Foundation leverages its voice and resources to amplify the work of those addressing and removing barriers to entrepreneurship for BIPOC in the US and women globally, leading with Trust Based Philanthropy. We also support our employees with meaningful giving and volunteer opportunities. |
eBay hosts one of the world’s largest and most active fundraising platforms, partnering with charity organizations to help them reach their fundraising goals.
Sustainable Commerce Circular commerce has been a part of eBay since we were founded over 25 years ago. We also continually strive to integrate best practices at our facilities to reduce our environmental footprint. | |||||
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eBay created a trusted, transparent marketplace that’s based on the strong ethical values we follow as a business. |
Goals: We are continuously working to quantify, track and manage our environmental footprint.
Notice of Annual Meeting of Stockholders
To our Stockholders:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of eBay Inc., a Delaware corporation, will be held on Thursday, May 18, 2017 at 8:00 a.m. Pacific Time at 2025 Hamilton Avenue, San Jose, California 95125.
Renewable Energy
Source 100 percent renewable energy in our electricity supply by 2025 for eBay-controlled data centers and offices. | Carbon Emissions – Science Based Target
Reduce absolute scope 1 and scope 2 GHG emissions 90% by 2030 from a 2019 base year and reduce absolute scope 3 emissions from downstream transportation and distribution 20%. | |||
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These items of business are described more fully in the accompanying proxy statement. We will be providing access to our proxy materials over the Internet under the Securities and Exchange Commission’s “notice and access” rules. As a result, on or about April 3, 2017, we are mailing to many of our stockholders a notice instead of a paper copy of the proxy statement and our 2016 Annual Report.
Your vote is important. Regardless of whether you plan to participate in the Annual Meeting, we hope you will vote as soon as possible. You may cast your vote over the Internet, by telephone, by mail or during the Annual Meeting.
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER
MEETING TO BE HELD ON MAY 18, 2017: THE PROXY STATEMENT AND THE ANNUAL REPORT ARE AVAILABLE AT
https://investors.ebayinc.com/annuals.cfm
This proxy statement will also be available in interactive form at https://iiwisdom.com/ebay-2017.
By Order of the Board of Directors
Marie Oh Huber
Secretary
Table of Contents
* GMV, Revenue, and Revenue from International Operations represent FY 2021.
** Global Active Buyers and Approximate number of live listings is a trailing 12-month metric as of the end of 2021.
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Letter to Our Stockholders
Dear Fellow Stockholders:
We are proud that our shared values of transparency, responsibility and business performance have supported eBay’s mission to empower people and create economic opportunity throughout 2021. As your Board of Directors, we are focused on creating value for you—our stockholders—in increasingly competitive markets and during these unsettled times. Drawing on your input, we are supporting our leadership team in realizing its vision for a tech-led reimagination of eBay, a marketplace that will continue to drive success for its buyers and sellers around the world.
You are cordially invited to attend the 2022 Annual Meeting of Shareholders (Annual Meeting) of eBay Inc. to be held on June 8, 2022, at 8:00 a.m. Pacific Time. The matters expected to be acted upon at the Annual Meeting are described in detail in the accompanying Notice of Annual Meeting of Shareholders and proxy statement.
Board Succession Plans and Refreshment
We are soliciting proxies for the election at the annual meeting of nine individuals to serve as directors of eBay until the 2023 Annual Meeting of Stockholder. Anthony Bates, Diana Farrell, Bonnie Hammer, and Matthew Murphy have each decided to not stand for re-election. During their tenures, Tony, Diana, Bonnie and Matt have provided eBay with exceptional guidance, expertise and insights. We thank them for their tremendous contributions. The Board has a commitment to refreshment, and we look forward to recruiting at least one additional independent director in the coming months, who will further enhance our composition and bring skills complementary to eBay’s strategic vision.
Sustainable Commitments
As Board members we, and the thousands of eBay employees, deeply share the sentiment that the company’s purpose links us to something bigger than any one of us. To ensure the achievement of our long-term business goals, we exercise our oversight to ensure that eBay’s sustainability initiatives focus on the matters that are material to our business and where we can be most impactful to our stakeholders. This includes our commitments to corporate governance best practices (especially our engagement with and responsiveness to shareholders), our impact on the environment and the communities we serve and overseeing meaningful progress in diversity, equity and inclusion. We invite you to read more in our Impact and DE&I reports and the Compensation and Human Capital Committee’s letter contained in this proxy statement.
Engaging Virtually
This year will be our third virtual annual meeting. This format offers the key features of an in-person meeting without putting anyone at risk of COVID-19. Although this decision was driven by the public health crisis, we hope it will also improve your ability to attend and participate while saving stockholders the time and expense of travel. In the virtual meeting, participants will join via a website where they can listen to the speakers, view any presentations, submit questions and comments, hear the company’s responses, and vote their shares electronically. We recommend that participants log in at least 15 minutes prior to the start of the meeting.
Thank you for your continued investment in eBay. We are proud to represent stockholder interests in this great company and look forward to meeting with you at the 2022 Annual Meeting of Stockholders.
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Proxy Statement Summary
This summary highlights information contained elsewhere in this Proxy Statement. This summary does not contain all of the information that you should consider, and you should read the entire Proxy Statement carefully before voting.
Meeting Information
Meeting Information | ||||||
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Date and Time Wednesday, June 8, 2022 | ||||||
| Web Address www.virtualshareholdermeeting. com/EBAY2022 | |||||
Record Date You are eligible to vote if you were a stockholder at the close of business on April 12, 2022. | ||||||
How to Vote | ||||||
Online You can vote your shares online at www.proxyvote.com | Phone You can vote your | Date and sign your proxy card or voting instruction form and return it in the postage-paid envelope. | ||||
How to Vote
YOUR VOTE IS IMPORTANT. You are eligible to vote if you were a stockholder at the close of business on March 20, 2017 (the “Record Date”). Even if you plan to attend the meeting, please vote as soon as possible using any of the following methods. In all cases, you should have your notice, or if you requested to receive printed proxy materials, your proxy card or voting instruction form on hand and follow the instructions:
Proposals Requiring Your Vote
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Description | Board’s Voting Recommendation | |||||
| Election of | FOR each director nominee | ||||
| Ratification of appointment of independent auditors | FOR | Page 37 | |||
3 | Advisory vote to approve named executive officer compensation | FOR | ||||
| Approval of the | FOR |
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| AGAINST |
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Corporate Governance Best Practices
Proxy Statement Summary
Corporate Governance
The Board of Directors (the “Board”) of eBay Inc. (“eBay” or the “Company”) is responsible for (1) providing advice and oversight of the strategic and operational direction of the Company; and (2) overseeing the Company’s executive management, each to ensure the Company operates in ways that support the long-term interest of our stockholders and the stakeholders we serve. The following is a list of governance provisions that demonstrate eBay’s commitment to transparency and accountability:
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2017 Director Nominees
Name and Primary Occupation | Age | Director since | Independent | Committee Memberships* | Other Public Boards | |||||
Fred D. Anderson Jr. Co-Founder, Elevation Partners Co-Founder, NextEquity Partners | 72 | 2003 | YES | Audit (Chair) | 1 | |||||
Edward W. Barnholt Former President and CEO, Agilent Technologies, Inc. | 73 | 2005 | YES | Compensation (Chair) | 2 | |||||
Anthony J. Bates Former President, GoPro, Inc. | 49 | 2015 | YES | Compensation | 2 | |||||
Logan D. Green Co-Founder and CEO, Lyft Inc. | 33 | 2016 | YES | Corporate Governance | None | |||||
Bonnie S. Hammer Chairman, NBCUniversal Cable Entertainment | 66 | 2015 | YES | Compensation | 1 | |||||
Kathleen C. Mitic Founder and CEO, Sitch, Inc. | 47 | 2011 | YES | Compensation Governance (Chair) | 1 | |||||
Pierre M. Omidyar Founder, eBay | 49 | 1996 | YES | None | 1 | |||||
Paul S. Pressler Partner, Clayton, Dubilier & Rice, LLC Interim CEO and Chairman, David’s Bridal | 60 | 2015 | YES | Audit Governance | 1 | |||||
Robert H. Swan Chief Financial Officer, Intel Corporation | 56 | 2015 | NO | None | None | |||||
Thomas J. Tierney Chairman, eBay Inc. Chairman and Co-Founder, The Bridgespan Group | 63 | 2003 | YES | Compensation Governance | None | |||||
Perry M. Traquina Former Chairman, CEO, and Managing Partner, Wellington Management Company LLP | 60 | 2015 | YES | Audit Governance | 2 | |||||
Devin N. Wenig President and CEO, eBay | 50 | 2015 | NO | None | None |
* Audit = Audit Committee; Compensation = Compensation Committee; Governance = Corporate Governance and Nominating Committee
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Proxy Statement Summary
Executive Compensation
Following the 2015 Spin-Off of PayPal (the “Spin-Off”), we conducted an extensive review of the Company’s compensation philosophy and executive compensation program for 2016 to determine whether they continued to be properly aligned with our business goals, culture, and importantly, stockholder interests. Following this review, the Compensation Committee and our CEO remained committed to our existing executive compensation program, which is designed to align with our business goals and culture, serves the long-term interests of our stockholders and is highly performance based. We believe that our pay-for-performance driven executive compensation program ensures that our executives’ compensation is tied to delivering results that support the Company’s business strategy and objectives.
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The goals of our executive compensation program are to:
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We achieve these objectives primarily by employing the following elements of pay for our executive officers:
Our executive officers also participate in our broad-based retirement savings and benefit programs and receive limited perquisites.
For 2016, we chose to continue to use a mix of equity and cash compensation vehicles to compensate our executive officers. We also decided to increase the weight of performance-based restricted stock units (“PBRSUs”) and eliminate the use of stock options. Our incentive compensation is dependent on financial targets that the Compensation Committee believes correlate with operating performance over one- and multi-year performance periods and long-term stock performance.
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Proxy Statement Summary
The following chart shows the breakdown of 2016 compensation for our CEO, Devin Wenig, and illustrates the predominance of equity incentives and performance-based components in our executive compensation program.
DEVIN WENIG
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We believe our compensation practices align with and support the goals of our executive compensation program and demonstrate our commitment to sound compensation and governance practices.
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Corporate Governance
Overview
The Board is responsible for (1) providing advice and oversight of the strategic and operational direction of the Company and (2) overseeing the Company’s executive management each to ensure the Company operates in ways that support the long-term interest of our stockholders and the other stakeholders we serve. To do this effectively, the Board has adopted clear and specific governance guidelines (“Corporate Governance Guidelines”) that, along with our Bylaws, Board committee charters, and our Code of Business Conduct and Ethics (“Code of Business Conduct”), provide the framework for the governance of the Company.
The followingeBay is a list of governance provisions that demonstrate eBay’s commitmentcommitted to transparency and accountability:accountability, as demonstrated by the following governance features:
| Separate Chairman and CEO roles
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Declassified Board with all members standing for election annually
| Independent Chairman with robust responsibilities | ||
Majority vote standard for uncontested director elections
| Simple majority vote standard for bylaw/ charter amendments and transactions | ||
Stockholder right to call a special meeting | Clawback policy | ||
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Strong stockholder engagement practices | Anti-hedging and anti-pledging policies |
Director Diversity
Our directors exhibit the following diverse mix of characteristics:
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2022 Board Nominees
Other Public | |||||||
Director | Committees | Company | |||||
Name and Principal Occupation | Age | Since | AC | CHCC | RC | CGNC | Boards |
Adriane M. Brown INDEPENDENT Managing Partner, Flying Fish Ventures | 63 | 2017 | 3 | ||||
Logan D. Green INDEPENDENT Chief Executive Officer and Co-Founder, Lyft | 38 | 2016 | 1 | ||||
E. Carol Hayles INDEPENDENT Former Chief Financial Officer, CIT Group, Inc. | 61 | 2020 | 2 | ||||
Jamie Iannone President and Chief Executive Officer, eBay Inc. | 49 | 2020 | 0 | ||||
Kathleen C. Mitic INDEPENDENT Co-Chief Executive Officer and Co-Founder, SomethingElse | 52 | 2011 | 2 | ||||
Paul S. Pressler INDEPENDENT Chair of eBay Board; Operating Advisor, Clayton, Dubilier & Rice | 65 | 2015 | 0 | ||||
Mohak Shroff INDEPENDENT Head of Engineering, LinkedIn | 43 | 2020 | 0 | ||||
Robert H. Swan INDEPENDENT Operating Partner, Andreessen Horowitz | 61 | 2015 | 1 | ||||
Perry M. Traquina INDEPENDENT Former Chairman and CEO, Wellington Management Company | 66 | 2015 | 2 | ||||
AC Audit Committee CHCC Compensation and Human Capital Committee RC Risk Committee CGNC Corporate Governance Guidelines, the chartersand Nominating Committee
Committee Chair Member
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Executive Compensation Highlights
The objectives of our principal Board committees, and our Code of Business Conduct can be found on our investor relations website athttps://investors.ebayinc.com/corporate-governance.cfm. Any changes in these governance documents will be reflected in the same location on our website. Information contained on our investor relations website is not part of this Proxy Statement.executive compensation program are to:
Align compensation with our business objectives, performance and stockholder interests | Position us competitively among the companies against which we recruit and compete for talent | ||
Motivate executive officers to enhance | Enable us to attract, reward and retain executive officers and other key employees who contribute to our long-term success |
The rules of The NASDAQ Stock Market require listed companies to have a
Our board of directors with at least a majority of independent directors. These rules have both objective tests and a subjective testrecommends that shareholders vote to approve an advisory resolution on the compensation paid to the Company’s named executive officers, as described in this proxy statement, for determining who is an “independent director.”the following reasons.
How We Pay Our CEO | Compensation Practices | Compensation Design Changes for 2022 |
Mr. Iannone’s compensation is highly weighted to Company performance. Over 94% of his 2021 compensation is based on Company performance goals or is otherwise subject to stock price volatility.
| We align executive compensation with the interests of our stockholdersby emphasizing pay-for-performance and weighting equity more heavily in our total compensation mix, having meaningful stock ownership requirements, and a majority of total compensation comprises of performance-based compensation. | We evaluate plan designs annually to determine their appropriateness and have implemented the following changes for 2022. PBRSUs. Based on a desire to both extend the performance period to three years and incorporate a metric related to stock price performance against peers, and feedback from shareholders, the Committee added a three-year relative total shareholder return modifier to the PBRSUs awarded to our NEOs. The Committee also modified the performance periods for the core financial measures from a two-year period to a series of three one-year periods to better align with management’s annual financial planning. Performance Options.In addition to Restricted Stock Units (RSUs) and PBRSUs, which historically comprised 40% and 60% of equity compensation awarded to our NEOs, the Committee determined to allocate a percentage of target equity value to performance-vesting stock options. These stock options will only vest over a three-year performance period if predetermined operational goals and time-based vesting are satisfied. As a result, the target equity value will be comprised of 40% RSUs, 40% PBRSUs, and 20% performance-vesting stock options. eIP. The assessment of our executive leadership team’s performance will continue to include ESG factors related to sustainability and DE&I goals, as well as a customer satisfaction (CSAT) measure that can increase payouts based on performance. |
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Meeting of Stockholders |
The 2022 Annual Meeting of Stockholders of eBay Inc. will be conducted virtually on the Internet. There will be no in-person meeting.
Date and Time Wednesday, June 8, 2022 8:00 a.m. Pacific Time | Web Address www.virtualshareholdermeeting.com/ EBAY2022 | Record Date You are eligible to vote if you were a stockholder at the close of business on April 12, 2022. |
Proposals Requiring Your Vote
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1 | Election of 9 directors named in this Proxy Statement to our Board to | FOR each director | Page 3 |
2 | Ratification of appointment of independent | FOR | Page 37 |
3 | Advisory vote to approve named executive officer compensation | FOR | Page 42 |
4 | Approval of the Amendment and Restatement of the eBay Employee Stock Purchase Plan | FOR | Page 80 |
5 | Stockholder proposal, if properly presented | AGAINST | Page 85 |
On a quarterly basis, each member
Stockholders as of the record date will also transact on such other business as may properly come before the Annual Meeting or any adjournment or postponement of the Annual Meeting. The items of business are described more fully in the accompanying Proxy Statement. We will be providing access to our Board is required to complete a questionnaire designed to provide information to assistproxy materials over the Board in determining whether the director is independentinternet under the listing standards of The NASDAQ Stock Market and our Corporate Governance Guidelines, and whether members of our Audit Committee and Compensation Committee satisfy additional Securities and Exchange Commission (“SEC”) “notice and NASDAQ independence requirements.
Corporate Governanceaccess” rules. As a result, on or about April 26, 2021, we are mailing to many of our stockholders a notice instead of a paper copy of the Proxy Statement and our 2021 Annual Report.
Our
How to Vote YOUR VOTE IS IMPORTANT. Even if you plan to attend the meeting, please vote as soon as possible using any of the following methods. In all cases, you should have your notice, or if you requested to receive printed proxy materials, your proxy card or voting instruction form on hand and follow the instructions: Online You can vote your shares online at www.proxyvote.com Phone You can vote your shares by calling +1 (800) 690-6903. Mail Date and sign your proxy card or voting instruction form and return it in the postage-paid envelope.
By Order of the Board has adopted guidelines setting forth certain categories of transactions, relationships, and arrangements that it has deemed immaterial for purposesDirectors
Marie Oh Huber
Secretary
Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to be Held on June 8, 2022: the Proxy Statement and the Annual Report are Available at https://investors.ebayinc.com/financial-information/annual-reports/default.aspx |
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Table of making its determination regarding a director’s independence, and does not consider any such transactions, relationships, and arrangements in making its subjective determination.Contents
New in this Proxy Statement | |
Oversight of Sustainability and Human Capital Initiatives | page 21 |
Enhanced Self Evaluation Process | page 22 |
Spotlight on eBay’s Information Security | page 25 |
Compensation Design Changes for 2022 | page 45 |
Adopted or modified in recent years in response to stockholder feedback or as part of ongoing assessment of governance best practices. Forward-Looking Statements. Certain statements in this proxy statement, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements may appear throughout this proxy statement. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events, or otherwise. Information on our website should not be deemed incorporated into or part of this proxy statement. | |
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Proposal 1 Election of Directors
We are seeking the election of 9 members to our Board, which will result in the size of the Board being reduced to 9 from the current 13. We thank our departing directors for their tremendous contributions. The Board has a long-standing commitment to refreshment, and we look forward to recruiting at least one additional independent director in the coming months, who will further enhance our composition and bring skills complementary to eBay’s strategic vision. The nominees are currently members of the Board, and each of the nominees has been elected previously by stockholders. Each of the nominees has consented to serving as a nominee and being named as a nominee in this Proxy Statement and to serving as a director if elected. Eight of 9 of the nominees are currently independent directors under the listing standards of The Nasdaq Stock Market and our Corporate Governance Guidelines. If elected at the Annual Meeting, each of the nominees will serve a one-year term until our 2023 Annual Meeting and will hold office until his or her successor is elected and qualified, or until his or her earlier death, resignation, retirement, or removal Our bylaws provide that in the event of an uncontested election, each director shall be elected by the affirmative vote of a majority of the votes cast with respect to such director—i.e., the number of shares voted “FOR” a director nominee must exceed the number of votes cast “AGAINST” that nominee. The Company has a resignation policy and bylaw provision that would apply to any nominee who does not receive the vote required for election. For more details, please see Corporate Governance – Governance Policies and Practices – Majority Vote Standard for Election of Directors and Director Resignation Provisions for Uncontested Elections. |
The Board recommends a vote FOR each of the director nominees. |
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Our Board has determined that each of the following directors is independent under the listing standards of The NASDAQ Stock Market and under eBay’s Corporate Governance Guidelines:Nomination Process
The Board limits membership on the Audit Committee, the Compensation Committee, and theOur Corporate Governance and Nominating Committee and Board have evaluated each of the director nominees recommended by our Board against the factors and principles eBay uses to independent directors.
Ourselect director nominees. Based on this evaluation, our Corporate Governance Guidelines require any director who has previously been determined to be independent to informand Nominating Committee and the ChairmanBoard have concluded that it is in the best interests of eBay and its stockholders for each of the Board and our Corporate Secretary of any change in his or her principal occupation or statusproposed nominees to serve as a memberdirector of the board of any other public company, including retirement, or any change in circumstance that may cause his or her status as an independent director to change.
Corporate Governance
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In accordance with our Bylaws, our Board elects our Chairman of the Board and appoints our CEO. Our Corporate Governance Guidelines require that the roles of Chairman of the Board and CEO be held by separate individuals and require the appointment of a lead independent director if the Chairman of the Board is not an independent director. Mr. Tierney has served as our Chairman of the Board since July 2015.eBay. The Board believes that all of these nominees have a strong track record of being responsible stewards of stockholders’ interests and bring extraordinarily valuable insight, perspective, and expertise to the separationBoard. Additional reasons that the Board recommends supporting the election of the officesdirector nominees include:
All directors are elected annually. We do not have a classified board.
The Board has three principal committees: the Audit Committee, the Compensation Committee, and the Corporate Governance and Nominating Committee.
The purpose of the Board committees is to help the Board effectively and efficiently fulfill its responsibilities, but they do not displace the oversight of the Board as a whole. Each committee meets regularly and has a written charter that has been approved by the Board. In addition, a member of each committee periodically reports on any significant matters discussed by the committee.
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management. During 2016,2021, our Board held fiveseven meetings, and each Board member attended at least 75% of the aggregate number of allmeetings of the Board meetings and committee meetings for the committees on which suchhe or she served. All of our nominees serve on two or less other public company boards except for one nominee who serves on three, and each of the nominees who is currently an executive officer of a publicly traded company does not serve on any other boards beyond eBay and the Board of his or her own company.
In addition to these attributes, in each individual’s biography set forth below, we have highlighted specific experience, qualifications, and skills that led the Board to conclude that each individual should serve as a director served.
of eBay. For additional information regarding the Corporate Governance and Nominating Committee’s approach to Board refreshment and nominations, please see Corporate Governance – Board Composition and Independence – Nominating Process on page 18.
Audit Committee4 ebay / 2022 Proxy Statement
Each member of the Audit Committee is independent in accordance with the audit committee independence requirements of the listing rules of The NASDAQ Stock Market and the applicable rules and regulations of the SEC. Our Board has determined that Mr. Anderson is an “audit committee financial expert” as defined by the SEC.
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| Adriane M. Brown Age: 63 Director Since: 2017 Committees: • • Risk Committee
• Axon Enterprise, Inc. (since 2020) • • KKR & Co. Inc. (since 2021)
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Experience
Ms. Brown joined Flying Fish Ventures, as a Venture Partner in November 2018 and in early 2021 became a Managing Partner of the venture capital firm, which specialized in Artificial Intelligence and Machine Learning startups. Prior to that, Ms. Brown served as President and Chief Operating Officer for Intellectual Ventures (“IV”), an invention and investment company that commercializes inventions, from January 2010 through July 2017, and served as a Senior Advisor until December 2018. Before joining IV, Ms. Brown served as President and Chief Executive Officer of Honeywell Transportation Systems. Over the course of 10 years at Honeywell, she held leadership positions serving the aerospace and automotive markets globally. Prior to Honeywell, Ms. Brown spent 19 years at Corning, Inc., ultimately serving as Vice President and General Manager, Environmental Products Division, having started her career there as a shift supervisor.
Ms. Brown serves on the boards of directors of American Airlines Group, Inc., Axon Enterprise, Inc., KKR & Co. Inc., Washington Research Foundation, and the Pacific Science Center. Ms. Brown previously served on the boards of directors of Allergan Plc, and Raytheon Company until 2020 and Harman International Industries from 2013 to 2017.
Ms. Brown holds a Doctorate of Humane Letters and a bachelor’s degree in environmental health from Old Dominion University and is a recipient of its Distinguished Alumni Award. She also holds a master’s degree in management from the Massachusetts Institute of Technology where she was a Sloan Fellow.
Director Qualifications
• | Investment/Finance, Management, Transactions/M&A and Technology Industry Experience:President and Chief Operating Officer for IV from January 2010 to July 2017. During her tenure at IV, the company delivered more than $3 billion in revenue, invented technology enabling 14 companies and joint ventures, acquired 50 customers and established Global Good and Research, a global health invention and innovation project. |
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Logan D. Green Age: 38 Director Since: 2016 Committees: • Compensation and Human Capital Committee Other • Lyft, Inc. (since 2019) |
Experience
Mr. Green has served as the Chief Executive Officer and Co-Founder of Lyft, Inc., a rideshare company, since 2012, where he is also a member of the Board of Directors. Lyft grew out of Zimride, a rideshare company previously co-founded by Mr. Green in 2007. Zimride was acquired by Enterprise Rent-A-Car. Mr. Green received his B.A. in Business Economics from the University of California, Santa Barbara.
Director Qualifications
• | Technology and E-Commerce Industry, Leadership, Transactions/M&A, Management, Strategy and Entrepreneurship Experience: CEO and Co-Founder of Lyft, a publicly traded, on-demand transportation company. |
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E. Carol Hayles Age: 61 Director Since: 2020 Committees: • Audit Committee (Chair) Other Public Company Boards: • Blucora, Inc. (since 2018) • Webster Financial Corporation (since 2018) |
Experience
Ms. Hayles was Executive Vice President and Chief Financial Officer of CIT Group Inc., a financial services company from November 2015 to May 2017, during which time she was responsible for overseeing all financial operations. She served as Controller and Principal Accounting Officer of CIT Group Inc. from July 2010 to November 2015, where she was responsible for managing the financial accounting and reporting functions, including SEC and regulatory reporting.
Prior to CIT, Ms. Hayles spent 24 years in various finance roles at Citigroup, Inc., most recently as Deputy Controller. She began her career at PricewaterhouseCoopers LLP in Toronto, Canada. She was a Canadian Chartered Accountant from 1985 to 2009, and she received her BBA from York University in Toronto.
Director Qualifications
• | Investment/Finance, Management, Transactions/M&A and Leadership Experience:Chief Financial Officer of CIT Group and executive role with Citigroup. |
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Jamie Iannone Age: 49 Director Since: 2020 Committees: • None Other Public Company Boards: • None |
Experience
Mr. Iannone has been President and Chief Executive Officer of eBay since April 2020.
Earlier in 2020, Mr. Iannone served as Chief Operating Officer of Walmart eCommerce, where he also was responsible for Store No. 8, Walmart’s incubation hub. Since 2014, Mr. Iannone held leadership roles at Walmart Inc. including CEO of SamsClub.com and Executive Vice President of membership and technology, Sam’s Club, a $57 billion business. In those roles, Mr. Iannone grew the SamsClub.com business and Sam’s Club’s membership base.
Before Walmart Inc., Mr. Iannone was Executive Vice President of Digital Products at Barnes & Noble, Inc., where he was responsible for all NOOK devices, software, accessories and retail integration and experiences; books and digital content; and third-party partnerships.
Mr. Iannone held various roles at eBay from 2001 to 2009, including leading Product Marketing, Search, and Buyer Experience.
He previously worked at Epinions.com and Booz Allen Hamilton. Mr. Iannone also served on the Board of Directors of The Children’s Place.
He earned a Bachelor of Science in operations research, engineering and management systems from Princeton University and a Master of Business Administration from the Stanford Graduate School of Business.
Director Qualifications
• | Product and Media Experience:Delivered innovative product experiences in executive roles at eBay, SamsClub.com and Sam’s Club, and Barnes and Noble. Led media partnerships, books, digital content, and NOOK software at Barnes and Noble. |
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Kathleen C. Mitic Age: 52 Director Since: 2011 Committees: • Compensation and Human Capital Committee • Corporate Governance and Nominating Committee (Chair) Other Public Company Boards: • RH (f/k/a Restoration Hardware Holdings, Inc.) (since 2013) • TCV Acquisition Corp. (since 2021) |
Experience
Ms. Mitic is Co-CEO and Co-Founder of SomethingElse, a direct-to-consumer beverage company. From 2012 to 2017, Ms. Mitic was the Chief Executive Officer and Co-Founder of Sitch, a startup building mobile consumer products.
From 2010 to 2012, Ms. Mitic served as Director of Platform and Mobile Marketing at Facebook, where she was responsible for developing and growing global developer and partner products. Prior to joining Facebook, Ms. Mitic served as Senior Vice President, Product Marketing at Palm, expanding the company product lines and international footprint through its acquisition by Hewlett-Packard in 2010.
Prior to Palm, Ms. Mitic spent 15 years in leadership positions at various consumer technology companies. These experiences include at NetDynamics (acquired by Sun Microsystems) where she launched the industry’s first application server, at Four11 where she built the email service RocketMail (now Yahoo! Mail) and at Yahoo! where she served as Vice President and General Manager.
Ms. Mitic currently serves on the boards of directors of RH (formerly known as Restoration Hardware Holdings, Inc.) and TCV Acquisition Corp. She also serves on the board of directors of Headspace, a health and wellness technology company, DVx Ventures, and the non-profit organization Lean In.
Ms. Mitic received her B.A. from Stanford University and her M.B.A. from Harvard Business School.
Director Qualifications
• | Technology Industry, Entrepreneurship Management and Leadership Experience:Consumer-facing executive positions in technology industry (listed above) for over twenty years. Entrepreneurial experience building and operating technology companies as Co-Founder and Co-Chief Executive Officer of Sitch, Inc. and former Vice President and General Manager of Yahoo! Inc. |
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Paul S. Pressler Chair of the Board Age: 65 Director Since: 2015 Committees: • Compensation and Human Capital Committee • Corporate Governance and Nominating Committee Other Public Company Boards: • None |
Experience
Mr. Pressler has been an Operating Advisor of Clayton, Dubilier & Rice, LLC, a private equity investment firm, since 2020. He was previously a partner of Clayton, Dubilier & Rice from 2009 to 2020. Previously, Mr. Pressler was Chairman of David’s Bridal, Inc. from 2012 to 2018, AssuraMed Holding, Inc. from 2010 to 2013 and SiteOne Landscape Supply, Inc. from to 2013 to 2017.
Mr. Pressler served as President and Chief Executive Officer of The Gap, Inc. for five years, from 2002 to 2007. Before that, he spent 15 years in senior leadership roles with The Walt Disney Company, including Chairman of the global theme park and resorts division, President of Disneyland, and President of The Disney Stores.
Mr. Pressler currently serves on the board of directors of Wilsonart, Inc. and MOD Super Fast Pizza, LLC.
Mr. Pressler received his B.S. from the State University of New York at Oneonta.
Director Qualifications
• | Leadership, Management, Retail Industry and Strategy Experience:Formerly Chairman of David’s Bridal, Chairman of SiteOne Landscape Supply, Chairman of AssuraMed, President and Chief Executive Officer of The Gap, and 15 years in senior leadership at The Walt Disney Company, including President of The Disney Stores. |
10 ebay / 2022 Proxy Statement
Mohak Shroff Age: 43 Director Since: 2020 Committees: • Risk Committee Other Public Company Boards: • None |
Experience
Mr. Shroff is Sr. Vice President and Head of Engineering at LinkedIn. His teams are responsible for building, scaling, and protecting LinkedIn. In his time at LinkedIn, he has played several key roles, from serving as head of product engineering, to working with the infrastructure and monetization teams, to leading Project Inversion.
Prior to joining LinkedIn in 2008, Mr. Shroff served as key technical leader on the Ariba Supplier Network engineering team. Mr. Shroff holds a BS in computer science from University of Texas at Austin.
Director Qualifications
• | Technology Industry, Product, Management, Strategy and Leadership Experience:Executive and technology leader with LinkedIn. |
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Robert H. Swan Age: 61 Director Since: 2015 Committees: • Audit Committee • Risk Committee (Chair) Other Public Company Boards: • GoTo Group |
Experience
Mr. Swan is an operating partner at Andreessen Horowitz (a venture capital firm) where he advises growth stage portfolio companies as they scale their businesses. Previously, he was CEO of Intel Corporation (“Intel”), a multinational technology company. He first served as Intel’s Executive Vice President and Chief Financial Officer from 2016 and added interim CEO to his duties in June 2018 to January 2019, then served as a director and CEO from January 2019 to February 2021. Mr. Swan served as an Operating Partner of General Atlantic, a leading global growth equity firm. From 2006 to 2015, Mr. Swan served as Senior Vice President, Finance and Chief Financial Officer at eBay, where he oversaw all aspects of the Company’s finance function, including controllership, financial planning and analysis, tax, treasury, audit, mergers and acquisitions, and investor relations. Prior to eBay, Mr. Swan served as Chief Financial Officer at Electronic Data Systems Corp., TRW Inc., and Webvan Group, Inc. He also served as Chief Operating Officer and CEO of Webvan Group.
He currently serves on the Board of Commissions of GoTo Group, an Indonesian technology company publicly traded on the IDX, and the Board of Directors of Flexport, a logistics technology company. He previously served on the board of directors of Applied Materials, Inc. from 2009 to 2016, and AppDynamics from 2016 to 2017.
Mr. Swan began his career at General Electric, where he spent 15 years in numerous senior finance roles, including divisional Chief Financial Officer for GE Transportation Systems, GE Healthcare Europe, and GE Lighting.
Mr. Swan received his B.S. from the University at Buffalo and his M.B.A. from the State University of New York at Binghamton.
Director Qualifications
• | Leadership, Management, Strategy Experience and Technology and E-Commerce/Retail Industry Experience: Former Chief Executive Officer of Intel and executive roles at eBay, Intel, Electronic Data Systems and TRW. |
12 ebay / 2022 Proxy Statement
Perry M. Traquina Age: 66 Director Since: 2015 Committees: • Audit Committee • Corporate Governance and Nominating Committee Other Public Company Boards: • Morgan Stanley (since 2015) • The Allstate Corporation (since 2016) |
Experience
Mr. Traquina is the former Chairman, Chief Executive Officer, and Managing Partner of Wellington Management Company LLP, a global investment management firm. Mr. Traquina held this position for a decade until his retirement from the firm in 2014. During his 34-year career at Wellington, he was an investor for 17 years and a member of the management team for the other half of his time at the firm.
Mr. Traquina received his B.A. from Brandeis University and his M.B.A. from Harvard University.
Director Qualifications
• | Leadership and Management Experience:Former Chairman, CEO, and Managing Partner of Wellington Management Company LLP, and current service on boards of directors of Morgan Stanley and The Allstate Corporation. |
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Corporate Governance
eBay is committed to transparency and accountability, as demonstrated by the following governance features:
Stockholder Rights | |
Our Board is committed to good corporate governance and believes in maintaining policies and practices that serve the interests of all stockholders, including governance provisions that protect and empower stockholders. | |
| Special Meetings – Stockholders representing 20% or more of eBay common stock can call a special meeting of stockholders. This threshold was previously 25%. N E W |
Annual Election of Board of Directors – All directors are elected annually by the stockholders, and stockholders can remove directors with or without cause. | |
Majority Voting for | |
Proxy Access for Director Nominations – We have adopted a proxy
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Corporate Governance
The Audit Committee also has primary responsibility for the oversight of risks facing our business. See “Corporate Governance – Our Corporate Governance Practices – Risk Oversight – Audit Committee’s Role in Risk Oversight.”
You can view our Audit Committee Charter on the corporate governance section of our investor relations website athttps://investors.ebayinc.com/corporate-governance.cfm.
Compensation Committee
The members of our Compensation Committee are all independent in accordance with the rules and regulations of The NASDAQ Stock Market, the Exchange Act and Section 162(m) of the Internal Revenue Code.
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Majority Voting for Charter and Bylaw Amendments – Our charter and bylaw provisions do not have supermajority voting provisions. Stockholders can approve binding charter and bylaw amendments with a majority vote. | ||
Independent Board Leadership – We have separated the | ||
Stockholder Engagement – Stockholders can communicate directly with the Board and/or individual directors. In addition, management and members of the Board regularly engage with stockholders to solicit their views on important issues such as corporate governance and executive compensation. | ||
N E W Adopted or modified in
stockholder feedback or as part of ongoing assessment of governance best practice. | ||
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The Compensation Committee Charter permits the Compensation Committee to, in its discretion, delegate all or a portion of its duties
Board Composition and responsibilities to a subcommittee of the Compensation Committee.
Additional disclosure regarding the role of the Compensation Committee in compensation matters, including the role of consultants in compensation decisions, can be found under “Compensation Discussion and Analysis — Compensation Decisions for 2016” and “Compensation Discussion and Analysis — Further Considerations for Setting Executive Compensation — Role of Consultants in Compensation Decisions” below.
You can view our Compensation Committee Charter on the corporate governance section of our investor relations website athttps://investors.ebayinc.com/corporate-governance.cfm.
Compensation Committee Interlocks and Insider Participation. All members of the Compensation Committee during 2016 were independent directors, and no member was an employee or former employee of eBay. No Compensation Committee member had any relationship requiring disclosure under Item 404 of Regulation S-K promulgated by the SEC. During 2016, none of our executive officers served on the Compensation Committee (or its equivalent) or board of directors of another entity whose executive officer served on our Compensation Committee or Board.
Corporate GovernanceIndependence
Corporate GovernanceThe Board has developed a set of guiding principles relating to Board membership. The Board believes that in light of the rapidly changing environment in which the Company operates, the Board must be comprised of members with highly relevant professional experience. In addition, although the Board does not have term limits, the Board believes that a certain amount of director turnover is to be expected and Nominating Committeeis desirable.
All members
Ongoing Assessment of Composition
Commitment to Board Refreshment
Our Board has shown an ongoing commitment to Board refreshment and to having highly qualified, independent perspectives in the boardroom. Of our 9 director nominees, 8 were added since 2015. Our directors have an average tenure of 5 years. This experience balances the institutional knowledge of our Corporate Governancelonger-tenured directors with the fresh perspectives brought by our newer directors. A goal of our board refreshment is enhancing the diversity of skills and Nominating Committee are independent underexperience of the listing standardsBoard and well-planned succession planning for alignment with oversight of The NASDAQ Stock Market. Mr. Green joined the Corporate Governance and Nominating Committee in March 2017.long-term strategy.
Nominating Process | ||
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Director Nominations.The Corporate Governance and Nominating Committee considers nominee recommendations from a variety of sources, including nominees recommended by stockholders. The Corporate Governance and Nominating Committee has from time to time retained an executive search firm to help facilitate the screening and interview process of director nominees. The Corporate Governance and Nominating Committee expects that qualified candidates will have high-level managerial experience in a relatively complex organization or be accustomed to dealing with complex problems, and will be able to represent the interests of the stockholders as a whole rather than special interest groups or constituencies.
Director Selection Principles
Among otherThe Corporate Governance and Nominating Committee considers a number of factors in determining the slate of director nominees for election to the Company’s Board that it recommends to the Board, with each candidate being reviewed relative to the following principles.
The Board should be composed of directors chosen on the basis of their character, integrity, judgment, skills, background, and experience of particular relevance to the Company. | |
Directors should have high-level managerial experience in a relatively complex organization or be accustomed to dealing with complex problems. | |
Directors should also represent the balanced, best interests of the stockholders as a whole, rather than special interest groups or constituencies. | |
Each director should be an individual of the highest character and integrity, with the ability to work well with others and with sufficient time available to devote to the affairs of the Company in order to carry out the responsibilities of a director. | |
In addressing the overall composition of the Board, characteristics such as gender, race, age, international background, and expertise should be considered. | |
The Board should be composed of directors who are highly engaged with our business. | |
The Board should include individuals with highly relevant professional experience. | |
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Diversity of Skills and Experience
In planning for succession, the Corporate Governance and Nominating Committee considers each candidate relative to the following attributes:overall mix of skills and experience of the Board and the types of skills and experience desirable for future Board members, in light of the Company’s business and long-term strategy. Experiences, qualifications, skills and attributes prioritized by the committee include the following:
+ Technology industry experience + Retail and e-commerce industry experience +Strategy experience in either established or growth markets + Investment and finance experience + Leadership experience, including public company governance + Entrepreneurship +Transactional experience, including mergers and acquisitions | + Management experience, including talent and culture development + Product, marketing and media experience + Government and public policy experience + Global business experience + Sustainable business practices experience + Financial expertise, including expertise gained as a chief financial officer or other sophisticated experience |
The Corporate GovernanceFurther Diversity Priorities (Gender and Nominating Committee also considers the interplay of a candidate’s background and expertise with that of other Board members, and the extent to which a candidate may be a desirableRace)
In addition to any committee of the Board. The Corporate Governanceskills and Nominating Committee also values diversity as a factor in selecting nominees to serve on the Board.
Our Corporate Governance Guidelines provide thatexperience, the Corporate Governance and Nominating Committee should consider diversity (includingconsiders gender, race, age and race), age, international background, and expertisenational origin in evaluating potential Board members. When searching for new directors, the Corporate Governance and Nominating Committee actively seeks out qualified women and individuals from minorityunderrepresented groups to include in the pool from which Board nominees are chosen. Finally,
In addition to diversity in experiences, our directors also reflect diversity in the categories noted below:
Board Diversity Matrix (As of April 21, 2022)
Board Size: | ||
Total Number of Directors | 13 | |
Female | Male | |
Directors | 5 | 8 |
African American or Black | 1 | 0 |
South Asian | 0 | 1 |
Hispanic or Latinx | 1 | 0 |
White | 4 | 7 |
Two or More Races or Ethnicities | 1 | 0 |
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Stockholder Nominations and Proxy Access
Stockholders wishing to submit recommendations or director nominations pursuant to the advance notice procedures set forth in our bylaws for our 2023 Annual Meeting of Stockholders should submit their recommendations or nominations to the Corporate Governance and Nominating Committee also takes into accountin care of our Corporate Secretary. Such nominations should be in accordance with the set of guiding principles relatingtime limitations, procedures, and requirements described under the heading “May I propose actions for consideration at next year’s Annual Meeting or nominate individuals to Board membership describedserve as directors?” in “Our Corporate Governance Practices — Succession Planning”Questions and Answers About the Proxy Materials and Our 2022 Annual Meeting below.
Corporate Governance
You can view our Corporate Governance and Nominating Committee Charter on the corporate governance section of our investor relations website athttps://investors.ebayinc.com/corporate-governance.cfm.
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Our Board is committed to good corporate governance and believes in maintaining policies and practices that serve the interests of all stockholders, including governance provisions that protect and empower stockholders, including:
Director Independence
The rules of The Nasdaq Stock Market require listed companies to have supermajority voting provisions. Stockholders can approve binding charter and bylaw amendmentsa board of directors with at least a majority vote.
Objective tests | The objective tests state, for example, that a director is not considered independent if he or she is an employee of the Company, or is a partner in, or a controlling stockholder or executive officer of, an entity to which the Company made, or from which the Company received, payments in the current or any of the past three fiscal years that exceed 5% of the recipient’s consolidated gross revenue for that year. |
Subjective test | The subjective test requires our Board to affirmatively determine that a director does not have a relationship that would interfere with the director’s exercise of independent judgment in carrying out his or her responsibilities. |
Each member of our Board is required to provide information to supplement the Company’s own due diligence to assist the Board in determining whether the director is independent under the listing standards of The Nasdaq Stock Market and our Corporate Governance Guidelines, and whether members of our Audit Committee and Compensation and Human Capital Committee satisfy additional SEC and Nasdaq independence requirements.
Our Board has adopted guidelines setting forth certain categories of transactions, relationships, and arrangements that it has deemed immaterial for purposes of making its determination regarding a director’s independence, and does not have a stockholder rights plan (also known as a “poison pill”).
Our Board Leadership – We have separatedhas determined that 8 of our 9 Director nominees are independent under the roleslisting standards of ChairmanThe Nasdaq Stock Market and under eBay’s Corporate Governance Guidelines. Jamie Iannone, who joined the Board and became our President and Chief Executive Officer on April 27, 2020, is not an independent director. Each of the directors who will depart the Board at the 2022 Annual Meeting is independent.
In accordance with the rules of The Nasdaq Stock Market, the Board limits membership on the Audit Committee, the Compensation and Human Capital Committee, and the Corporate Governance and Nominating Committee to independent directors.
Our Corporate Governance Guidelines require any director who has previously been determined to be independent to inform the Chair of the Board and our Corporate Secretary of any change in circumstance that may cause his or her status as an independent director to change.
18 ebay / 2022 Proxy Statement
Board Leadership Structure and Effectiveness
Board Leadership
In accordance with our bylaws, our Board elects our Chair of the Board and appoints our CEO. The ChairmanOur Corporate Governance Guidelines require that the roles of Chair of the Board and CEO be held by separate individuals and require the appointment of a lead independent director if the Chair of the Board is not an independent director – as are alldirector. The Board believes that the separation of the chairsoffices of the committees of the Board.
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We have a practice of regularly engaging with stockholders to seek their feedback on our corporate governance practices and our executive compensation program. After we file our proxy statement, we engage with our largest stockholders about important topics to be addressed at our annual meeting. In the fall, we conduct an additional cycle of stockholder engagement where we focus on our corporate governance practices and executive compensation program, as well as anything else resulting from matters voted on at our annual meeting. Following each round of stockholder engagement, we provide an overviewChair of the discussionsBoard since June 2020.
Committee Structure
The Board has four principal committees: the Audit Committee, the Compensation and feedbackHuman Capital Committee, the Corporate Governance and Nominating Committee and the Risk Committee.
The purpose of the Board committees is to help the Board effectively and efficiently fulfill its responsibilities, but they do not displace the oversight of the Board as a whole. Each committee meets regularly and has a written charter that has been approved by the Board. In addition, a member of each committee periodically reports to the applicable Committees, which is alsoBoard on any significant matters discussed withby the Board.
Corporate Governance |Our Corporate Governance Practices
Gender Pay Equity and Global Diversity & Inclusion.At our 2016 annual meeting, stockholders considered a stockholder proposal to publish a report on gender pay equity. Prior to receiving this stockholder proposal, we had begun the process of conducting an extensive global study of gender pay equity that considered the main components of compensation, including salary, bonus and stock. While the proposal did not pass, it garnered significant support. In October 2016, we publicly disclosed key findings of our pay equity study, including that women earn the same as men in the U.S. in terms of salary. As part of our fall governance outreach, we updated our stockholders on the results of our gender pay equity study. In addition, in March 2017, we publicly disclosed our first Global Diversity & Inclusion report since the Spin-Off of PayPal and the sale of our Enterprise segment. The report included both quantitative information on our global gender diversity and U.S. racial and ethnic diversity and qualitative information on our strategic approach, programs and initiatives.
Our Corporate Governance Practices
We believe that strong corporate governance practices that provide meaningful rights to our stockholders and ensure Board accountability are key to our relationship with our stockholders. To help our stockholders understand our commitment to this relationship and our governance practices, the Board has adopted a set of Corporate Governance Guidelines to set a framework within which the Board will conduct its business. Our Corporate Governance Guidelines are summarized below along with certain other of our governance practices.
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Executive Sessions among Independent Directors. At least several times a year, the independent directors meet in executive session. The Chairman leads these discussions.
Outside Advisors.committee. The Board and each of its committees may retain outside advisors of its choosing at the Company’s expense. Neither the Board nor any committee is required to obtain management’s consent to retain outside advisors.
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Audit Committee
Each member of the Audit Committee is independent in accordance with the audit committee independence requirements of the listing rules of The Nasdaq Stock Market and the applicable rules and regulations of the SEC. Our Board has determined that each of Ms. Hayles and Messrs. Traquina and Swan is an “audit committee financial expert” as defined by SEC rules.
Members
• E. Carol Hayles (Chair) | • Matthew Murphy | Meetings in 2021: 8 |
• Perry M. Traquina | • Robert Swan | |
Key Responsibilities
You can view our Audit Committee Charter on the corporate governance section of our investor relations website at https://investors.ebayinc.com/corporate-governance/governance-documents.
Compensation and Human Capital Committee
The members of our Compensation and Human Capital Committee are all independent in accordance with the rules and regulations of The Nasdaq Stock Market and the Exchange Act and Section 162(m) of the Internal Revenue Code. In 2021, we took the important step of expanding the role of the Committee to formally include broad oversight of Human Capital Management. In this capacity, we have planned with the executive leadership team to engage in a regular cadence of discussions throughout the year on critical matters such as diversity, equity & inclusion, pay equity and management development.
Members
• Adriane M. Brown (Chair) | • Kathleen C. Mitic | Meetings in 2021: 5 |
• Anthony J. Bates | • Paul S. Pressler | |
• Logan Green | ||
Key Responsibilities
You can view our Compensation and Human Capital Committee Charter on the corporate governance section of our investor relations website at https://investors.ebayinc.com/corporate-governance/governance-documents.
20 ebay / 2022 Proxy Statement
Corporate Governance and Nominating Committee
All members of our Corporate Governance and Nominating Committee are independent under the listing standards of The Nasdaq Stock Market.
Members
• Kathleen C. Mitic (Chair) | • Paul S. Pressler | Meetings in 2021: 3 |
• Diana Farrell | • Perry M. Traquina | |
• Bonnie S. Hammer | ||
Key Responsibilities
The Corporate Governance and Nominating Committee takes into account the set of guiding principles relating to Board membership described in “Board Composition and Independence.”
You can view our Corporate Governance and Nominating Committee Charter on the corporate governance section of our investor relations website at https://investors.ebayinc.com/corporate-governance/governance-documents.
Risk Committee
The Risk Committee Charter requires a majority of the committee members to be independent under the listing standards of the Nasdaq Stock Market. Currently, all members of our Risk Committee are independent under the Nasdaq Stock Market listing standards.
Members
• Robert H. Swan (Chair) | • Diana Farrell | Meetings in 2021: 3 |
• Matthew Murphy | ||
• Adriane M. Brown | • Mohak Shroff | |
Absent exigent circumstances, all
Key Responsibilities
You can view our Risk Committee Charter on the corporate governance section of our investor relations website at
https://investors.ebayinc.com/corporate-governance/governance-documents.
www.ebayinc.com 21
Board membersand Committee Effectiveness
We believe in strong corporate governance practices that provide meaningful rights to our stockholders and ensure Board accountability. Our Corporate Governance Guidelines set forth a framework within which our Board conducts its business and demonstrates our commitment to good governance and a productive relationship with our stockholders. Principle features of our Corporate Governance Guidelines are summarized below along with certain other of our governance practices.
Engaged Independent Oversight Board Operations o Robust oversight of corporate strategy o Executive sessions scheduled for each regular Board meeting o Director product showcases o Open access to senior management and information o Access to third-party advisors o Frequent informal Board calls o Opportunity to engage with employees at company-wide events o Engagement with management outside of Board meetings through working groups Governance Practices Accountability to Stockholders o Proxy access for director candidates nominated by stockholders o Majority voting standard for uncontested director elections o Annual director elections o All directors are expected to attend eBay’s annual meetingthe Annual Meeting of Stockholders, and with the exception of now-retired Directors Anderson and Omidyar, all attended the 2021 Annual Meeting Governance Principles o Independent Chair o Stock ownership guidelines for directors o Prohibition on stock hedging and pledging o Commitment to strong governance practices and recognition of the importance of strong governance to value creation and risk oversight Incorporation of Feedback Annual Governance Review o Review and update corporate governance practices in context of Board operations and stakeholder feedback o Review committee charters annually and update as needed Annual Self-Evaluation o Formal Board and committee self-evaluations conducted by independent Chairs o Feedback incorporated into Board practices o Enhanced process to include 1v1 conversations between chairs and individual directors based on results of written feedback N E W Stockholder Outreach o Regular fall and spring governance outreach with significant stockholders Board Composition Director Recruitment o Seek directors with diverse perspectives and expertise relevant to our long-term business strategy o Emphasis on adding directors with diverse backgrounds to the Board Diverse, Independent Board with Mix of Tenures o All directors except our CEO are independent o Board includes five female and three racially diverse directors o Directors possess wide range of expertise to foster diverse perspectives Director Education o eBay provides membership in person or by telephone or video call. Allthe National Association of ourCorporate Directors to all directors servingand sponsors attendance at additional educational programs o Directors provided updates on ourrelevant eBay compliance training Board at the time of our last annual meeting of stockholders, which was held in April 2016, attended that meeting.
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Annual Self-Evaluations It is important that the Board and its committees are performing effectively and in the best interests of the Company and its stockholders. The Board and each committee perform an annual self-assessment toannually evaluate its effectiveness in fulfilling its obligations. As part of this annual self-assessment,self-evaluation, directors are able to provide feedback on the performance of other directors. The Chairmanchairs of the Board leadsand of the Corporate Governance and Nominating Committee lead the Board in its review of the results of the annual self-assessmentself-evaluation. Self-Evaluation Questionnaire Provides director feedback on the Board and takes further actioneach of the Committees as needed. Inwell as each director Director Interviews Chairs have 1v1 conversations with individual directors based on themes of questionnaire responses Results Analyzed Results of the self-evaluations are analyzed and discussed with Corporate Governance and Nominating Committee Summary of Results Summary of Board and Committee self-evaluation results provided to full Boa rd Ongoing Feedback Directors are encouraged to provide ongoing feedback in addition to the annual self-evaluation Feedback Incorporated Policies and practices updated as appropriate as a result of the annual self-evaluation and ongoing feedback Review of Process Our Corporate Governance and Nominating Committee periodically reviews the self-evaluation process
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Board Oversight and Stockholder Engagement
Strategy Oversight
One of the Board’s key responsibilities is overseeing the Company’s strategy, and the Board has deep experience and expertise in the area of strategy development and insights into the most important issues facing the Company. Setting the strategic course of the Company provides membership ininvolves a high level of constructive engagement between management and the National Association of Corporate Directors to all Board members to assist them in remaining current with exemplary board and committee practices and developments in corporate governance.Board.
The Board regularly discusses eBay’s key priorities, taking into consideration and adjusting the Company’s long-term strategy with global economic, customer and other significant trends, as well as changes in the e-commerce industry and the regulatory landscape.
Corporate Governance |Our Corporate Governance Practices
Management Succession Planning and Workplace Culture
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The Board recognizes the importance of effective executive leadership to eBay’s success. We conduct a review process at least annually that includes succession plans for our senior leadership positions. These succession plans are reviewed and approved by ourthe Board. In conducting its review, the Board considers, among other factors, organizational and operational needs, competitive challenges, leadership/management potential and development, and emergency situations.
Board Connection to eBay Workplace Culture
The Board is intently focused on fostering a culture of leadership, development and excellence
Our workplace culture is linked to eBay’s mission of empowering people and creating economic opportunity for all. This shared purpose has influenced our culture for over 25 years and motivates our employees every day. We are rooted in core beliefs of empowering our community, innovating boldly, delivering with impact, being for everyone and acting with integrity. The Board views eBay’s workplace culture as an asset and oversees eBay’s employee engagement and other workforce development programs.
Management Accessibility and Engagement • Our CEO worked across the company on a recommitment to “Our DNA”, a framework to link all employees to our purpose, our role in people’s lives, our strategic vision and our beliefs • Regular rhythm of employee “All Hands” meetings with the CEO and senior leaders • Learning sessions with the initiative and business leaders Learning and Development • Strong culture of 360 feedback, professional development with opportunities for stretch assignments, leader and instructor-led training and self-directed learning • Company-wide program on doing business with integrity including “tone from the top” program with key compliance themes quarterly | Board Connection Succession Planning • Robust succession planning at most senior level Oversight of Development Programs • People program accomplishment review • Compensation and Human Capital Committee oversight of human capital management strategy and practices Engagement with Employees • Participation in employee “All Hands” meetings, including International Women’s Day and Conscious Inclusion programs |
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Enterprise Risk is inherent with every business, and how well a business manages risk can ultimately determine its success. We face a number of risks, includingSustainability Oversight
eBay faces economic, financial, legal and regulatory, operational and other risks, such as the impact of competition. Management is responsible forcompetition and sustainability risks, including social, environmental and reputational factors that are integral to the day-to-day managementstrength of the risksour brands. The Board recognizes that our ability to manage risk can influence whether we face, while theachieve our strategic and operating objectives. The Board, as a whole and through its committees, has responsibility for the oversight of risk management.management, while management is responsible for the day-to-day management of the risks that we face. In its risk oversight role, the Board is responsible for satisfying itself that the risk management framework and supporting processes as implemented by management are adequate and functioning as designed. The Board also influences risk management by fostering a corporate culture of integrity and risk awareness.
Audit Committee’s Role in Risk Oversight.While the
Board is ultimatelyof Directors Ultimately responsible for risk oversight at eBay,and direct oversight of major risks o Strategic and competitive o Operational planning and execution o Determines risk oversight responsibilities of its committees Risk Committee Assists the Board has delegatedin its oversight of the Enterprise Risk Management ("ERM") program for key risks such as information security and regulatory compliance (including privacy, anti-money laundering and foreign assets control). Audit Committee Oversight of financial risks facing the Company's businesses, including tax, credit, market, liquidity and investment policy risk. Oversight of ethics and compliance program and responsibility for review of related party transactions. Compensation and Human Capital Committee Promotes appropriate level of risk taking by management through the design and administration of our compensation programs. Oversight of management's global compensation and employee retention strategies. Oversight of human capital management strategy and practices. Corporate Governance and Nominating Committee Influences culture of the board and tone from the top through Board composition recommendations. Oversight of eBay sustainability initiatives, including eBay Impact. ERM Program With oversight from the Risk Committee, identifies, assesses, prioritizes and manages our major risk exposures. Senior Management Guides programs and reports to Board and committees on strategies and progress o Promotes a workforce culture of risk awareness o Determines with Board appropriate risk tolerances Internal Audit Reporting directly to the Audit Committee, supplies independent assurance of design and effectiveness of risk management. eBay Impact With oversight from the primary responsibilityCorporate Governance and Nominating Committee, team of key functional leaders implementing policies and programs for the oversight of risks facing our businesses. The Audit Committee’s charter provides that it will reviewsustainability and discuss with management our major risk exposures, including financial, operational, privacy, security, cybersecurity, competition, legal,philanthropy. Business Functions, Operations and regulatory risks,Commerce Platforms Our People, Culture and the steps we have taken to detect, monitor,Beliefs
24 ebay / 2022 Proxy Statement
Risk Management and actively manage such exposures, as well as management’s risk assessment andSustainability
Our risk management policies. The Audit Committee reviews with our General Counsel any significant legal, compliance,framework, including ERM and regulatory matters that could have a material impact on our financial statements or our business, including material notices to or inquiries received from governmental agencies. We also haveImpact sustainability programs, is embedded an enterprise risk management (“ERM”) program across our core businesses, aligned with oversight of our Company-wide initiative involvingcompany-wide initiatives by the Audit Committee,Board and its committees as illustrated above. Our approach to risk management and other personnel. The ERM framework is designed to identify, assess, prioritize and manage our major risk exposures which could affect our ability to execute on our corporate strategy and fulfill our business objectives. The ERM program is designed toThese programs enable the Audit CommitteeBoard to establish a mutual understanding with management of the effectiveness of the Company’s risk management practices and capabilities, to review the Company’s risk exposure and risk tolerance, and to elevate certain key risks for oversight at the Board level.
Management’s Role in Risk Oversight.Our Vice President, Internal Audit is responsible for
Management collaborates internally, with oversight from the Board, and periodically engages independent advisors to update risk assessments. Key risks encompassed by the ERM program include, without limitation, information security, data privacy, human capital management and regulatory compliance (including privacy, anti-money laundering and foreign assets control). As a result of our internal audit function and our risk governance framework, which includesmost recent sustainability risk assessment, monitoring,eBay’s Impact team focuses its efforts on several key areas, including Economic Opportunity, Sustainable Commerce, Culture & Workforce and reporting. The Vice President, Internal Audit reports directlymaintaining a Trusted Managed Marketplace. This assessment will be updated in Fall 2022 in order to the Audit Committee, and the Audit Committee reviews and evaluates the compensation and performancecontinually reflect our most salient issues.
Key members of the Vice President, Internal Audit and provides the Vice President, Internal Audit with direct access to the Audit Committee. The Vice President, Internal Audit facilitates the Audit Committee’smanagement, as appropriate, periodically review and approval of the internal audit plan and provides regular reporting on audit activities. In addition, through consultation with management, the Vice President, Internal Audit periodically assesses the major risks facing eBay and coordinates with the executives responsible for such risks through the risk governance process. The Vice President, Internal Audit periodically reviews with the AuditRisk Committee the major risks facing eBay and the steps management has taken to detect, monitor, and actively manage those risks within the agreed risk tolerance. Likewise, the Corporate Governance and Nominating Committee receives periodic updates on eBay sustainability initiatives. The executiveexecutives responsible for managing a particular risk may(in the case of cybersecurity risks, our Chief Technology Officer and Chief Information Security Officer) also report to the Audit CommitteeBoard or its committees, as appropriate, on how the risk is being managed and progress towards agreed mitigation goals.
In addition
Management works across the organization to help our business groups and functions prioritize risk management as part of the general oversight responsibility that has been delegated tocompany’s strategy. Through the Audit Committee, other committees reviewcombination of the risks within their areas of responsibility and expertise. For example, the Compensation Committee reviews the risks associated with our compensation policies and practicesERM program and our succession planning process.
Corporate Governance |Our Corporate Governance Practices
Risk AssessmentImpact sustainability efforts, we believe that our risk management framework appropriately addresses the spectrum of Compensation Policies and Practices.We haverisks facing our businesses, including but not limited to each of the material issues identified by the Sustainability Accounting Standards Board (SASB) industry standards as being applicable to companies in our industry, including climate risks. Climate risks are more fully assessed the compensation policies and practicesin our separate Task Force for our employees and concluded that they do not create risks that are reasonably likely to have a material adverse effect on the Company. This analysis was presented to the Audit Committee and the Compensation Committee, both of which agreed with this conclusion.
Climate-Related Financial Disclosure (TCFD) aligned report found at https:/Corporate Hotline. We have established a corporate hotline that is operated by a third party and allows any employee to confidentially and anonymously (where legally permissible) lodge a complaint about any accounting, internal control, auditing, or other matters of concern./www.ebayinc.com/impact/.
Spotlight on eBay’s Information SecurityN E W | |
Risk relating to information security is a continued area of focus for eBay, and are managed within our ERM Program. The Board’s oversight of these risks has included the following activities: • At least 3 deep dive reports at the Risk Committee level and at least 1 Board level discussion annually on information security risks including payments security, data security, regulatory compliance, platform security and other categories of risk. • Audit Committee discussion of relevant Sarbanes-Oxley Act and internal audit activities. • Periodic Risk Committee reviews of management’s strategies to detect, monitor and manage information security risks. | |
Diversity, Equity & Inclusion Highlights
Diversity, Equity and Inclusion (DE&I) is core to who we are and is the cornerstone upon which our business is built. We are committed to being a richly diverse, truly equitable and fearlessly inclusive place to work, grow, sell and buy. Over the past year, we have evolved our approach to DE&I by focusing on key objectives we need to deliver to realize sustained progress. Our four objectives are: increasing representation, cultivating a sense of belonging, engaging our communities and allies - our sellers and buyers as well as the broader communities we serve - and building inclusive technology. Equity remains at the forefront of all we do as we deliver meaningful progress across each of these strategic objectives. We will continue to be transparent about our journey, progress made as well as lessons learned. The results of our sixth gender pay equity study found that we have 99.9% gender pay equity in the U.S. and 100.0% globally. For more information please visit our Diversity, Equity and Inclusion website at https://www.ebayinc.com/company/diversity-equity-inclusion/.
www.ebayinc.com 25
eBay Impact
Many of our Impact sustainability initiatives involve cross-company collaboration on goal setting, impact measurement and reporting, which is published we publish annually on the eBay Impact website. To advance our strategies, manage environmental, social and governance (“ESG”) risks and capitalize on opportunities, eBay has formed the ESG Council, which is composed of key members of our management team and engages with numerous critical partners across the company. This Council is chaired by our Chief Sustainability Officer and is key to eBay integrating sustainability more seamlessly into the business and supporting our transition to a low carbon economy, which is currently focused on achieving 100% renewable energy in our electricity supply by 2025. We published our second TCFD report in 2021, addressing the investor need for increased disclosure on climate risks and opportunities. For more information please visit our eBay Impact website at https://www.ebayinc.com/impact/.
Empowering communities through thoughtful commerce
Economic Opportunity | Champions of inclusive commerce, eBay Seller School assists sellers in transforming their business, and we help small businesses grow globally, through programs such as eBay for Change and Up & Running. | From 2011 to 2019, the number of eBay’s commercial sellers in less-advantaged communities grew 22% percent compared to a 1.3% decrease in the overall number of business enterprises in those communities. |
| eBay hosts one of | In 2021, for the fourth year in a row, eBay for Charity broke our previous records, raising more than $145 million globally in charitable donations through the eBay marketplace. |
eBay Foundation | eBay Foundation leverages its voice and resources to amplify the work of those addressing and removing barriers to entrepreneurship for BIPOC in the US and women globally, leading with Trust Based Philanthropy. We also support our employees with meaningful giving and volunteering opportunities. | Since 1998, eBay Foundation has provided over $76 million in total giving, which has supported over 1,800 unique grantees. Since 2020, eBay Foundation grantees have created or strengthened more than 250,000 businesses. In 2021, eBay Foundation increased the employee matching gifts cap to $10,000 per employee and engaged 36% of employees in one or more programs. |
Sustainable Commerce | Circular commerce has been a part of our eBay brand since we were founded over 25 years ago. We continually strive to integrate best practices at our facilities to reduce our environmental footprint. | Through the sale of pre-owned apparel and electronics in North America and the UK, eBay helped avoid over 540 thousand metric tons of carbon emissions in 2021 alone. In 2020, eBay continued to make progress on our environmental goals, achieving 74% renewable energy globally and in 2021, eBay earned an A- on the CDP Climate survey in recognition of outstanding action against climate change. |
Trusted Marketplace | eBay created a trusted, transparent marketplace that’s based on the strong ethical values we follow as a business. | eBay earned a 100% rating on the Human Rights Campaign Foundation’s Corporate Equality Index 2022—our 14th year on the Index. In 2020, eBay published its first Global Transparency Report in order to openly communicate its trust and safety policies and enforcement of those policies. |
Goals: We are working to better understand, track and quantify our environmental footprint
Renewable Energy Source 100 percent renewable energy in our electricity supply by 2025 for eBay-controlled data centers and offices. | Carbon Emissions –Science Based Target Reduce absolute scope 1 and scope 2 GHG emissions 90% by 2030 from a 2019 base year and reduce absolute scope 3 emissions from downstream transportation and distribution 20%. | ||||
26 ebay / 2022 Proxy Statement
Stockholder Engagement
Why We Engage
Our directors and management are committed to maintaining a robust dialogue with stockholders. We routinely engage with stockholders throughout the year in order to:
After we file our proxy statement, we engage with our largest stockholders about important topics to be addressed at our annual meeting. Since January 2021, we have offered to meet on ESG matters with approximately 45 investors representing more than 50% of our outstanding shares, which resulted in approximately 25 conference calls with investors representing more than 25% of our outstanding shares.
How We Engage
Board The Chair of the Board and other directors are available for engagement with large stockholders, including participating in joint corporate governance and investor relations meetings. The Board receives feedback from management's engagement with stockholders through a cadence of management reports throughout the year. Investor Relations We provide institutional investors with many opportunities to provide feedback to our Board and management. We participate in: ? Webcast events ? One-on-one meetings ? Investor conferences throughout the year To learn more about our engagement, you may visit our investor relations website at https://investors.ebayinc.com. ESG Team We engage with governance representatives of our major stockholders through conference calls that occur during and outside of the proxy season. Members of eBay's corporate governance, investor relations, sustainability, corporate compliance, DE&I and executive compensation teams discuss, among other matters, company performance, emerging governance practices, the reasons behind a stockholder's voting decisions at prior meetings, executive compensation programs and sustainable business practices. Outcomes from Stockholder Engagement Stockholder feedback is thoughtfully considered and has led to modifications in our governance practices, executive compensation program and disclosure. Some of the actions we have taken that are informed by stockholder feedback over the last several years include: o Enhanced incentive compensation program to include ESG goals and three-year relative total shareholder return o Instituted eBay's first-ever dividend program and expanded return of capital through disciplined stock buybacks o Initiated a strategic portfolio review that resulted in the sale of StubHub, eBay Classifieds, and eBay Korea. o Conducted review, resulting in a three-year plan for significant margin expansion o Reorganized our executive leadership team and launched other important strategic and business initiatives o Reduced the threshold for calling a special meeting from 25 percent to a 20 percent standard o Adopted a mainstream proxy access bylaw o Increased stock ownership requirement for chief executive officer o Committed to enhancing the Board's oversight of eBay's political spending
www.ebayinc.com 27
Governance Policies and Practices
Contacting the Board or Individual Directors
Stockholders may contact the Board, individual directors or groups of directors (such as all of our independent directors) at the following address:
c/o Corporate Secretary, eBay Inc., 2025 Hamilton Avenue, San Jose, California 95125 |
The Corporate Governance and Nominating Committee has delegated responsibility for initial review of stockholder communications to our Corporate Secretary. This process assists the Board in reviewing and responding to stockholder communications in an appropriate manner. The Corporate Governance and Nominating Committee has instructed our Corporate Secretary to review correspondence directed to the Board and its principal committees. It is at her discretion to determine whether to forward items solely related to complaints by users with respect to ordinary course of business, customer service and satisfaction issues, or matters she deems to be of a commercial or frivolous nature or otherwise inappropriate for the Board’s or its committees’ consideration.
Governance Documents
Our Corporate Governance Guidelines, the charters of our principal Board committees, and our Code of Business Conduct can be found on our investor relations website at https://investors.ebayinc.com/corporate-governance/ governance-documents. Any changes in these governance documents will be reflected in the same location on our website. Information contained on our investor relations website is not part of this Proxy Statement.
Majority Vote Standard for Election of Directors
Our bylaws provide that in the event of an uncontested election, each director shall be elected by the affirmative vote of a majority of the votes cast with respect to such director—i.e., the numbers of shares voted “FOR” a director nominee must exceed the number of votes cast “AGAINST” that nominee. “ABSTAIN” votes will be counted as present for purposes of this vote but are not counted as votes cast. Broker non-votes will not be counted as present and are not considered votes on the proposal. As a result, abstentions and broker non-votes will have no effect on the vote for Proposal 1: Election of Directors.
Director Resignation Provisions for Uncontested Elections
If a nominee who is serving as a director (an “Incumbent Director”) fails to receive the required number of votes for election in accordance with our bylaws in an uncontested election, under Delaware law, the Incumbent Director would continue to serve on the Board as a “holdover director” until his or her successor is elected and qualified, until he or she is re-nominated after consideration by the Corporate Governance and Nominating Committee as described further below or until his or her earlier death, resignation, retirement, or removal pursuant to our bylaws. Our Corporate Governance Guidelines and Bylaws provide that, in considering whether to nominate any Incumbent Director for election, the Board will take into account whether the Incumbent Director has tendered an irrevocable resignation that is effective upon the Board’s acceptance of such resignation in the event the director fails to receive the required vote to be elected, as described above. Each of our Incumbent Directors has tendered an irrevocable resignation. In the case of a proposed nominee who is not an Incumbent Director, the Board will take into account whether he or she has agreed to tender such a resignation prior to being nominated for election.
In the case of an uncontested election, if a nominee who is an Incumbent Director does not receive the required vote for election, the Corporate Governance and Nominating Committee or another committee of the Board will decide whether to accept or reject such director’s resignation (if the director has tendered such a resignation), or whether to take other action, within 90 days after the date of the certification of the election results (subject to an additional 90-day period in certain circumstances). In reaching its decision, the Corporate Governance and Nominating Committee will review factors it deems relevant, which may include any stated reasons for “AGAINST” votes, whether the underlying cause or causes of the “AGAINST” votes are curable, criteria considered by the Corporate Governance and Nominating Committee in evaluating potential candidates for the Board, the length of service of the director, the size and holding period of such director’s stock ownership in the Company, and the director’s contributions to the Company. The Corporate Governance and Nominating Committee’s decision will be publicly disclosed in a filing with the SEC. If a nominee who was not already serving as a director fails to receive the required votes to be elected at the Annual Meeting, he or she will not become a member of the Board. All of the director nominees are currently serving on the Board and each director nominee has submitted an irrevocable resignation of the type described above.
28 ebay / 2022 Proxy Statement
Stock Ownership Guidelines
Our Board has adopted stock ownership guidelines to better align the interests of our directors and executive officers with the interests of our stockholders and further promote our commitment to sound corporate governance. Under these guidelines, our executive officers are required to achieve ownership of eBay common stock valued at three times their annual base salary (six times in the case of our CEO). For the executive officers, these guidelines are initially calculated using the executive officer’s base salary as of the date the person is first appointed as an executive officer. These guidelines are then recalculated each January 1st immediately following the third anniversary of the most recent calculation. In addition, these guidelines will also be recalculated as of the date on which an executive officer’s pay grade changes. Our directors (except for our CEO) are required to achieve ownership of eBay common stock valued at five times the amount of the annual retainer payable to directors.
Each of our executive officers is required to retain 50% of any shares received (net of any shares sold or withheld to pay any applicable exercise price or satisfy tax withholding obligations) as the result of the exercise, vesting or payment of any eBay equity awards granted to the executive officer until the stock ownership guidelines are met. Each of our non-employee directors is required to retain 25% of the shares received (net of any shares sold or withheld to pay any applicable exercise price or satisfy tax obligations) as the result of the exercise, vesting or payment of any eBay equity awards granted to the director until the stock ownership guidelines are met. Our stock ownership guidelines can be found on our investor relations website at https://investors.ebayinc.com/corporate-governance/governance-documents.
The ownership levels of our executive officers and directors as of April 1, 2022 are set forth in the section entitled “Security Ownership of Certain Beneficial Owners and Management.”
Hedging and Pledging Policy
The Company’s insider trading policy prohibits directors, executive officers, and other employees from entering into any hedging or monetization transactions relating to our securities or otherwise trading in any instrument relating to the future price of our securities, such as a put or call option, futures contract, short sale, collar, or other derivative security. The policy also prohibits directors and executive officers from pledging eBay common stock as collateral for any loans.
Clawbacks
In 2012, we implemented changes to the eBay Incentive Plan and the Company’s equity incentive plans to provide that awards made under those plans are subject to a clawback provision. In January 2014, the terms of the clawback were adopted by the Compensation and Human Capital Committee subject to amendment to comply with the SEC rules to be issued in accordance with the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, or the Dodd-Frank Act.
Conflicts of Interest/Code of Business Conduct
We expect our directors, executive officers, and other employees to conduct themselves with the highest degree of integrity, ethics, and honesty. Our credibility and reputation depend uponon the good judgment, ethical standards, and personal integrity of each director, executive officer, and employee. Our Code of Business Conduct requires that directors, executive officers, and other employees disclose actual or potential conflicts of interest and recuse themselves from related decisions. In order to better protect us and our stockholders, we regularly review our Code of Business Conduct and related policies to ensure that they provide clear guidance to our directors, executive officers, and employees.
The Company also has practices that address potential conflicts in circumstances where a non-employee director is a control person of an investment fund that desires to make an investment in or acquire a company that may compete with one of the Company’s businesses. Under those circumstances, the director is required to notify the Company’s CEO and General Counsel of the proposed transaction, and the Company’s senior management then assesses the nature and degree to which the investee company is competitive with the Company’s businesses, as well as the potential overlaps between the Company and the investee company. If the Company’s senior management determines that the competitive situation and potential overlaps between eBay and the investee company are acceptable, approval of the transaction by the Company would be conditioned upon the director agreeing to certain limitations (including refraining from joining the board of directors of the investee company or conveying any confidential or proprietary material between the Company and the investee company, abstaining from being the primary decision-maker for the investment fund with respect to the investee company, and recusing himself/herself from portions of Company Board meetings that contain competitive information reasonably pertinent to the investee company). All transactions by investment funds in which a non-employee director is a control person also remain subject in all respects to the Board’s written policy for the review of related person transactions, discussed under the section entitled “Certain Transactions with Directors and Officers” below.
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Stockholders wishing to submit recommendations or director nominations pursuant to the advance notice procedures set forth in our Bylaws for our 2018 Annual Meeting of Stockholders should submit their proposals to the Corporate Governance and Nominating Committee in care of our Corporate Secretary. Such submissions should be in accordance with the time limitations, procedures, and requirements described under the heading “May I propose actions for consideration at next year’s Annual Meeting or nominate individuals to serve as directors?Officers.” in the section entitled “Questions and Answers about the Proxy Materials and our 2017 Annual Meeting” below.
Proxy Access for Director Nominations. In March 2016, our Board adopted a “Proxy Access for Director Nominations” bylaw provision, which permits an eligible stockholder or group of up to 20 stockholders to nominate candidates for election to our Board. Proxy access candidates will be included in our proxy statement and ballot. The proxy access bylaw provision provides that holders of at least 3% of eBay common stock, which can comprise up to 20 stockholders, holding such stock continuously for at least three years, can nominate two individuals or 20% of the Board, whichever is greater, for election at an annual
Corporate Governance |Our Corporate Governance Practices
stockholders meeting. Our Bylaws provide details regarding the time frames and procedures that must be followed and other requirements that must be met to nominate directors through this process.www.ebayinc.com 29
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Stock Ownership Guidelines. Our Board has adopted stock ownership guidelines to better align the interests of our directors and executive officers with the interests of our stockholders and further promote our commitment to sound corporate governance. Under these guidelines, our executive officers are required to achieve ownership of eBay common stock valued at three times their annual base salary (seven times in the case of our CEO). Our non-employee directors are required to achieve ownership of eBay common stock valued at three times the amount of the annual retainer payable to directors as of the later of (i) July 1, 2016 or (ii) the year the director is first elected to the Board. Thereafter, these guidelines will be recalculated each June 1 (based on the value of each director’s annual retainer payable for that year). Our stock ownership guidelines can be found on our investor relations website at https://investors.ebayinc.com/corporate-governance.cfm.
The ownership levels of our executive officers and directors as of March 20, 2017 are set forth in the section entitled “Security Ownership of Certain Beneficial Owners and Management” below.
Hedging and Pledging Policy. The Company’s insider trading policy prohibits directors, executive officers, and other employees from entering into any hedging or monetization transactions relating to our securities or otherwise trading in any instrument relating to the future price of our securities, such as a put or call option, futures contract, short sale, collar, or other derivative security. The policy also prohibits directors and executive officers from pledging eBay common stock as collateral for any loans.
Clawbacks. In 2012, we implemented changes to the eBay Incentive Plan and the Company’s equity incentive plans to provide that awards made under those plans are subject to a clawback provision. In January 2014, the terms of the clawback were adopted by the Compensation Committee subject to amendment to comply with the SEC rules to be issued in accordance with the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, or the Dodd-Frank Act.
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Stockholders may contact the Board or individual directors at the following address:
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The Corporate Governance and Nominating Committee has delegated responsibility for initial review of stockholder communications to our Corporate Secretary. This process assists the Board in reviewing and responding to stockholder communications in an appropriate manner. The Corporate Governance and Nominating Committee has instructed our Corporate Secretary to review correspondence directed to the Board and its principal committees. It is at her discretion to determine whether to forward items solely related to complaints by users with respect to ordinary course of business, customer service and satisfaction issues, or matters she deems to be of a commercial or frivolous nature or otherwise inappropriate for the Board’s or its committees’ consideration.
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We have taken a number of steps to ensure continued independence of our outside auditors. Our independent auditors report directly to the Audit Committee, and we limit the use of our auditors for non-audit services. The fees for services provided by our auditors in 2016 and 2015 and our policy on pre-approval of non-audit services are described under “Proposal 4 — Ratification of Appointment of Independent Auditors” below.
Security Ownership of Certain Beneficial Owners and Management
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information known to us with respect to beneficial ownership of our common stock as of March 20, 2017 by (1) each stockholder known to us to be the beneficial owner of more than 5% of our common stock, (2) each director and nominee for director, (3) each of the executive officers named in the 2016 Summary Compensation Table below, and (4) all executive officers and directors as a group. Unless otherwise indicated below, the address for each of our executive officers and directors is c/o eBay Inc., 2025 Hamilton Avenue, San Jose, California 95125.
Shares Beneficially Owned (1) | ||||||||
Name of Beneficial Owner | Number | Percent | ||||||
Pierre M. Omidyar (2) | 70,368,858 | 6.52 | % | |||||
The Vanguard Group (3) | 66,983,234 | 6.21 | % | |||||
BlackRock, Inc. (4) | 60,506,773 | 5.61 | % | |||||
Devin N. Wenig (5) | 1,295,040 | * | ||||||
Scott F. Schenkel (6) | 262,319 | * | ||||||
Harry A. Lawton (7) | 71,010 | * | ||||||
Stephen Fisher (8) | 122,941 | * | ||||||
Raymond J. Pittman (9) | 120,889 | * | ||||||
Fred D. Anderson Jr. (10) | 21,616 | * | ||||||
Edward W. Barnholt (11) | 20,116 | * | ||||||
Anthony J. Bates (12) | 14,686 | * | ||||||
Logan D. Green (13) | 1,000 | * | ||||||
Bonnie S. Hammer (14) | 12,417 | * | ||||||
Kathleen C. Mitic (15) | 22,286 | * | ||||||
Paul S. Pressler (16) | 22,916 | * | ||||||
Robert H. Swan (17) | 352,405 | * | ||||||
Thomas J. Tierney (18) | 34,108 | * | ||||||
Perry M. Traquina (19) | 18,666 | * | ||||||
All directors and executive officers as a group of (20 persons) (20) | 73,324,080 | 6.78 | % |
Security OwnershipWe have established a corporate hotline that is operated by a third party and allows any employee to confidentially and anonymously (where legally permissible) submit a complaint about any accounting, internal control, auditing, or other matters of Certain Beneficial Owners and Management |Section 16(a) Beneficial Ownership Reporting Complianceconcern.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires our directors, executive officers, and holders of more than 10% of our common stock to file reports regarding their ownership and changes in ownership of our securities with the SEC and to furnish us with copies of all Section 16(a) reports that they file.
We believe that during the fiscal year ended December 31, 2016, our directors, executive officers, and holders of more than 10% of our common stock complied with all applicable Section 16(a) filing requirements, except for a late Form 4 filed on March 4, 2016 to report a purchase of common stock shares on the open market for Mr. Pressler.
In making this statement, we have relied upon a review of the copies of Section 16(a) reports furnished to us and the written representations of our directors, executive officers, and holders of more than 10% of our common stock.
Certain Transactions with Directors and Officers
Certain Transactions with Directors and Officers
Our Audit Committee reviews and approves the Code of Business Conduct, which applies to our directors, officers, and employees and reviews our programs that are designed to ensure compliance with the Code of Business Conduct. The Audit Committee also reviews and approves all transactions with related persons that are required to be disclosed in this section of our Proxy Statement. The charter of our Audit Committee and our Code of Business Conduct and Ethics may be found on our investor relations website athttps://investors.ebayinc.com/corporate-governance.cfmcorporate-governance/governance-documents/.
Our Board has adopted a written policy for the review of related person transactions. For purposes of the policy, a related person transaction includes transactions in which (1) the amount involved is more than $120,000, (2) eBay is a participant, and (3) any related person has a direct or indirect material interest. The policy defines a “related person” to include directors, nominees for director, executive officers, beneficial holders of more than five percent5% of eBay’s outstanding common stock and their respective family members. Pursuant to the policy, all related person transactions must be approved by the Audit Committee or, in the event of an inadvertent failure to bring the transaction to the Audit Committee for pre-approval, ratified by the Audit Committee. In the event that a member of the Audit Committee has an interest in a related person transaction, the transaction must be approved or ratified by the disinterested members of the Audit Committee. In deciding whether to approve or ratify a related person transaction, the Audit Committee will consider the following factors:
We have entered into indemnification agreements with each of our directors and executive officers. These agreements require us to indemnify such individuals, to the fullest extent permitted by Delaware law, for certain liabilities to which they may become subject as a result of their affiliation with eBay.
Since January 1, 2016,2021, there were no related person transactions, and we are not aware of any currently proposed related person transactions, that would require disclosure under SEC rules.
Proposals Requiring Your Vote |Proposal 1 — ElectionSection 16(a) of Directorsthe Exchange Act requires our directors, executive officers, and holders of more than 10% of our common stock to file reports regarding their ownership and changes in ownership of our securities with the SEC and to furnish us with copies of all Section 16(a) reports that they file. Based solely on our review of copies of the reports filed with the SEC and the written representations of our directors and executive officers, we believe that all reporting requirements for fiscal year 2021 were complied with by each person who at any time during the 2021 fiscal year was a director or an executive officer or held more than 10% of our common stock except for the following: due to administrative error, Ms. Loeger inadvertently filed a Form 4 late reporting two transactions, and due to system error, Mr. Green inadvertently filed a Form 4 late reporting sixteen transactions, which were made in accounts managed by a financial advisor to Mr. Green that had full investment control. Despite Mr. Green’s instruction to the advisor not to transact in shares of eBay common stock, due to a system error, the advisor made purchases and then subsequently sold eBay common stock when it realized that such purchases should not have been made. The transactions resulted in short-swing profits of $4,242.55, which Mr. Green has disgorged to eBay in accordance with Section 16(b) of the Securities Exchange Act of 1934.
30 ebay / 2022 Proxy Statement
Proposal 1 — ElectionCompensation of Directors
The Compensation and Human Capital Committee is responsible for reviewing and making recommendations to the Board regarding compensation paid to all directors who are not employees of eBay, or any parent, subsidiary, or affiliate of eBay, for their Board and committee services. Pay Governance LLC serves as the Compensation and Human Capital Committee’s independent compensation consultant. In connection with its engagement, Pay Governance assists the Compensation and Human Capital Committee in conducting annual peer benchmarking and assessment of market trends and best practices, to ensure that eBay’s director compensation program is in line with the market and that pay levels are comparable to peers. Our most recent benchmarking indicates that our compensation is benchmarked at or around the 50th percentile of our peer group.
Annual compensation to continuing non-employee directors consisted of (a) RSUs with a grant date value equal to $250,000 or, for a non-employee director serving as the Chair of the Board, $350,000, in each case rounded up to the nearest whole share, granted at the time of the annual meeting and (b) an annual cash retainer of $80,000 plus additional fees for chair and committee service paid in quarterly installments (or, at the non-employee director’s discretion, paid in additional common stock of an equivalent value rounded up to the nearest whole share). Effective in September 2020, the annual equity award and retainer are pro-rated in the event that a director serves for a portion of a year. The annual equity award is granted on the date of the director’s appointment unless the director is appointed more than 9 months since the last annual meeting (in which case, the director will receive cash in lieu of a grant).
We previously issued Deferred Stock Units (“DSUs”) as equity compensation for our non-employee directors. Since January 1, 2017, RSUs have been granted in lieu of DSUs as compensation for non-employee directors. DSUs granted prior to August 1, 2013 are payable in Company common stock or cash (at our election) following the termination of a non-employee director’s service on the Board. DSUs granted on or after August 1, 2013 are payable solely in Company common stock following the termination of a non-employee director’s service on the Board. In the event of a change in control of eBay, any equity awards granted to our non-employee directors will accelerate and become fully vested.
The following table sets forth annual retainers paid to our non-employee directors who serve as Chair of the Board; the Chairs of the Audit, Compensation, Corporate Governance and Nominating, and Risk Committees; and the members of those Committees. Directors with an interest and background in technology who meet regularly with our senior technologists and report significant matters to the Board do not receive any additional compensation for such service.
Role | 2021 Annual Retainer | ||||
All Independent Directors | $ 80,000 | ||||
Board Chair | $100,000 | ||||
Lead Independent Director (if applicable) | $ 25,000 | ||||
Audit | $ 25,000 | ||||
Compensation and Human Capital | $ 15,000 | ||||
Corporate Governance & Nominating | $ 15,000 | ||||
Risk | $ 15,000 | ||||
Committee Members | |||||
Audit |
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Compensation and Human Capital | $ 15,000 | ||||
Corporate Governance & Nominating | $ 10,000 | ||||
Risk | $ 10,000 |
At the Annual Meeting, 12 directors will be elected to serve for a one-year term until our 2018 Annual Meeting and until their successors are elected and qualified.
Our Board is currently composed of 12 members, 10 of whom are currently independent directors under the listing standards of The NASDAQ Stock Market.www.ebayinc.com 31
2021 Director Compensation Table
The term of office of each offollowing table and footnotes summarize the nominees standing for election at the Annual Meeting expires at the upcoming Annual Meeting. All of the nominees are currently members of the Board and each of the nominees has been elected previouslytotal compensation paid by the stockholders except Logan D. Green, who joinedCompany to non-employee directors for the Boardfiscal year ended December 31, 2021.
Name (a) | Fees Earned ($)(b) | Stock Awards ($)(c)(1) | Option Awards ($)(d) | All Other Compensation ($)(e) | Total ($)(f) | |||||
Anthony J. Bates | 105,000 | 250,000 | — | — | 355,000 | |||||
Adriane M. Brown | 120,000 | 250,000 | — | — | 370,000 | |||||
Diana Farrell | 100,000 | 250,000 | — | — | 350,000 | |||||
Logan D. Green | 95,000 | 250,000 | — | — | 345,000 | |||||
Bonnie S. Hammer | 90,000 | 250,000 | — | — | 340,000 | |||||
E. Carol Hayles | 105,349 | 250,000 | — | — | 355,349 | |||||
Kathleen C. Mitic | 120,000 | 250,000 | — | — | 370,000 | |||||
Matthew J. Murphy | 108,000 | 250,000 | — | — | 358,000 | |||||
Paul S. Pressler | 205,000 | 350,000 | — | — | 555,000 | |||||
Mohak Shroff | 82,940 | 250,000 | — | — | 332,940 | |||||
Robert H. Swan | 123,000 | 250,000 | — | — | 373,000 | |||||
Perry M. Traquina | 125,651 | 250,000 | — | — | 375,651 |
Fees Earned or Paid in June 2016. Mr. Green was recommended as a nominee by the Chair of our Corporate Governance and Nominating Committee and our CEO. Each of the nominees has consented to serving as a nominee and being named as a nominee in this Proxy Statement and to serving as a director if elected. If elected at the Annual Meeting, each of the nominees will serve a one-year term until our 2018 Annual Meeting and until his or her successor is elected and qualified, or until his or her earlier death, resignation, or removal.Cash (Column (b))
Majority Vote Standard for Election of Directors. Our Bylaws provide thatThe amounts reported in the event of an uncontested election,Fees Earned or Paid in Cash column reflect the cash fees earned by each non-employee director shall be elected by the affirmative vote of a majority of the votes castin 2021, which includes fees with respect to such director—i.e.,which the numbers of shares voted “FOR” a director nominee must exceed the number of votes cast “AGAINST” that nominee. “ABSTAIN” votes will be counted as present for purposes of this vote but are not counted as votes cast. Broker non-votes will not be counted as present and are not entitled to vote on the proposal. As a result, abstentions and broker non-votes will have no effect on the vote for this proposal.
Director Resignation Policy for Uncontested Elections. If a nominee who is serving as a director (an “Incumbent Director”) failsfollowing directors elected to receive the required numbershares in lieu of votes for re-election in accordance with our Bylaws in an uncontested election, under Delaware law the Incumbent Director would continue to serve on the Board as a “holdover director” until his or her successor is elected and qualified, or until his or her earlier resignation or removal pursuant to our Bylaws. Our Corporate Governance Guidelines provide that, in considering whether to nominate any Incumbent Director for re-election, the Board will take into account whether the Incumbent Director has tendered an irrevocable resignation that is effective upon the Board’s acceptance of such resignationcash.
Name | Fees Forgone ($) | Shares Received (#) | ||
Adriane M. Brown | 30,000 | 514 | ||
Robert H. Swan | 123,000 | 1,933 | ||
Perry M. Traquina | 125,651 | 1,991 |
32 ebay / 2022 Proxy Statement
Stock Awards (Column (c))
The amounts reported in the eventStock Awards column reflect the director fails to receiveaggregate grant date fair value of RSUs granted in 2021. The grant date fair value of each RSU was calculated using the required vote to be re-elected, as described above. Eachfair value of our Incumbent Directors has tendered an irrevocable resignation. In the case of a proposed nominee who is not an Incumbent Director, the Board will take into account whether he or she has agreed to tender such a resignation prior to being nominated for re-election.
In the case of an uncontested election, if a nominee who is an Incumbent Director does not receive the required vote for re-election, the Corporate Governance and Nominating Committee or another committee of the Board will decide whether to accept or reject such director’s resignation (if the director has tendered such a resignation), or whether to take other action, within 90 days aftercommon stock on the date of the certification of the election results (subject to an additional 90-day periodgrant calculated in certain circumstances). In reaching its decision, the Corporate Governance and Nominating Committee will review factors it deems relevant, which may include any stated reasons for “AGAINST” votes, whether the underlying cause or causes of the “AGAINST” votes are curable, criteria considered by the Corporate Governance and Nominating Committee in evaluating potential candidates for the Board, the length of service of the director, the size and holding
Proposals Requiring Your Vote |Proposal 1 — Election of Directors
period of such director’s stock ownership in the Company, and the director’s contributions to the Company. The Corporate Governance and Nominating Committee’s decision will be publicly disclosed in a filingaccordance with the SEC. If a nominee who was not already servingFinancial Accounting Standards Board’s Accounting Standards Codification Topic 718, Compensation—Stock Compensation. Each non-employee director providing service as a director failsthrough June 15, 2021, the date of our 2021 Annual Meeting, was granted 3,791 RSUs with a value of $250,000 on such date (or, in the case of Mr. Pressler, our Chair of the Board, 5,307 RSUs with a value of $350,000 on such date). Such RSUs become fully vested upon the earlier of (i) the first anniversary of the grant date, and (ii) the first annual meeting of the stockholders of the Company that occurs after the grant date.
As of December 31, 2021, each individual who served as a non-employee director during 2021 held the aggregate numbers of DSUs and RSUs as set forth below. There were no outstanding options held by non-employee directors as of December 31, 2021.
Name | DSUs Held as of 12/31/21 (#) | Total RSUs Held as of 12/31/21 (#) | ||
Anthony J. Bates | 5,810 | 3,791 | ||
Adriane M. Brown | — | 3,791 | ||
Diana Farrell | — | 3,791 | ||
Logan D. Green | — | 3,791 | ||
Bonnie S. Hammer | 3,711 | 3,791 | ||
E. Carol Hayles | — | 3,791 | ||
Kathleen C. Mitic | 25,212 | 3,791 | ||
Matthew J. Murphy | — | 3,791 | ||
Paul S. Pressler | 1,128 | 5,307 | ||
Mohak Shroff | — | 3,791 | ||
Robert H. Swan | 836 | 3,791 | ||
Perry M. Traquina | 6,198 | 3,791 |
All Other Compensation (Column (e))
The Company provides no other reportable compensation or benefits to receivenon-employee directors.
www.ebayinc.com 33
Executive officers are appointed annually by the required votes to be electedBoard and serve at the Annual Meeting, he or she will not become a memberdiscretion of the Board. AllSet forth below is information regarding our executive officers as of the director nominees are currently serving on the Board and each director nominee has submitted an irrevocable resignation of the type described above.
April 21, 2022.
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The Corporate Governance and Nominating Committee considers a number of factors and principles in determining the slate of director nominees for election to the Company’s Board that it recommends to the Board, as discussed in the section titled “Corporate Governance – Board of Directors and Committees – Corporate Governance and Nominating Committee,” above. In particular, the Board considers the following factors and principles to evaluate and select nominees:
Our Corporate Governance and Nominating Committee and Board have evaluated each of the director nominees against the factors and principles eBay uses to select director nominees. Based on this evaluation, our Corporate Governance and Nominating Committee and the Board have concluded that it is in the best interests of eBay and its stockholders for each of the proposed nominees listed below to serve as a director of eBay. The Board believes that all of these nominees have a strong track record of being responsible stewards of stockholders’ interests and bring extraordinarily valuable insight, perspective, and expertise to the Board. Additional reasons that the Board recommends supporting the election of the director nominees include:
In addition to these attributes, in each individual’s biography set forth below, we have highlighted specific experience, qualifications, and skills that led the Board to conclude that each individual should serve as a director of eBay.
Proposals Requiring Your Vote |Proposal 1 — Election of Directors
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| Jamie Iannone
Position: President and Chief Executive Officer Biography Mr. Iannone’s biography is set forth under the heading “Board of Directors” above. |
Age: 52 Position: Chief Financial Biography Mr. Priest has served eBay as Chief Financial Officer since June 2021. He previously served as
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34 ebay / 2022 Proxy Statement
Marie Oh Huber
Biography Ms. Huber serves eBay as Senior Vice President, Chief Legal Officer, General Counsel and Secretary. She assumed her current role in July 2015. Prior to joining eBay, Ms. Huber spent 15 years at Agilent Technologies, a |
Proposals Requiring Your Vote |Proposal 1 — Election of Directors
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Position: Senior Vice President, Chief Product Officer
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•Technology Industry Experience: Mr. Wenig was President of eBay’s Marketplaces business from 2011 to July 2015. Mr. Wenig was also CEO of Thomson Reuters Markets, which included significant software and internet businesses.
•Marketing Expertise: Mr. Wenig previously served in a number of marketing leadership positions at Reuters, including Managing Director of Marketing at Reuters Information, Executive Vice President of Marketing at Reuters America, and Executive Vice President of Marketing at Reuters Holding Switzerland SA.
•Leadership: Mr. Wenig brings significant leadership experience to the Board, because he is the President and CEO of eBay, and he previously served as CEO of Thomson Reuters Markets and was a member of the Board of Directors of Reuters Group PLC (Reuters).
Experience
Mr. Wenig has been President and CEO at eBay since July 2015. From 2011 to July 2015, Mr. Wenig served as President of eBay’s Marketplaces business. Previously, Mr. Wenig spent 18 years at Thomson Reuters, where he served as CEO of its largest division, Thomson Reuters Markets, from 2008 to 2011. In that role, he led the global financial services and media businesses, which provide information, analytics and technology services to professionals in the financial services, media, and corporate markets globally, as well as to individuals through its consumer media arm.
From 2006 to 2008, Mr. Wenig was Chief Operating Officer of Reuters, a provider of financial market data. In that role, he led Reuters’ consumer media and Internet strategy and was responsible for the company’s data, information, and analytical products, as well as the sales, information technology, and global marketing functions.
Prior to that, Mr. Wenig served on the Reuters Board of Directors and was president of Reuters’ Business Divisions from 2003 to 2006, where he was responsible for leading the revitalization of Reuters and its four business segments.
Mr. Wenig currently is a member of the Business Council. He also serves as the co-chair of the World Economic Forum’s Consumer Industries Steering Committee and as a Trustee of the Paley Center for Media.
Mr. Wenig received his B.A. from Union College and his J.D. from Columbia University School of Law.
Proposals Requiring Your Vote |Proposal 2 — Advisory Vote to Approve Named Executive Officer Compensation
Proposal 2 — Advisory Vote to Approve Named Executive Officer Compensation
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In accordance with the requirements of Section 14A of the Exchange Act, we are asking stockholders to approve, on an advisory basis, the compensation of our named executive officers as described in the Compensation Discussion and Analysis, compensation tables, and related narrative discussion of such compensation included in this Proxy Statement
As discussed in the Compensation Discussion and Analysis, the Compensation Committee of the Board is committed to an executive compensation program that is aligned with our business goals, culture, and stockholder interests. We believe a competitive compensation program that is highly performance-based is key to delivering long-term stockholder returns.
Our executive compensation program is designed to:
To achieve these objectives, our executive compensation program has three principal components: long-term equity compensation, an annual cash incentive, and base salary. The Compensation Committee seeks to have our named executive officers’ total compensation heavily weighted to variable, performance-based compensation by delivering a majority of compensation in the form of performance-based restricted stock units and annual cash incentives. Performance-based restricted stock units are granted based on our achievement of financial performance goals over a two-year performance period. Under our annual cash incentive plan, 75% of each named executive officer’s target bonus for 2016 was based on Company financial performance with the remaining 25% based on individual performance; there is no payout for individual performance unless thresholds for Company performance are met. We also granted time-based restricted stock units, the value of which depends on the performance of the Company’s stock.
The Compensation Committee believes that the goals of our executive compensation program are appropriate and that the program is properly structured to achieve those goals. We have engaged in ongoing discussions with our investors, who generally support those goals and the program, and we believe our stockholders as a whole should support them as well.
We are asking our stockholders to indicate their support for the compensation of our named executive officers as described in this Proxy Statement. This proposal, commonly known as a “say-on-pay” proposal, gives our stockholders the opportunity to express their views on the compensation of our named executive officers. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our named executive officers and the philosophy, policies, and practices described in this Proxy Statement. Accordingly, we ask our stockholders to vote “FOR” the following resolution at the Annual Meeting:
“RESOLVED, that the Company’s stockholders approve, on an advisory basis, the compensation of the named executive officers, as disclosed in the Company’s Proxy Statement for the 2017 Annual Meeting of Stockholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the 2016 Summary Compensation Table, and the other related tables and disclosures.”
While the say-on-pay vote is advisory, and therefore not binding on the Company, the Board and the Compensation Committee value the opinions of our stockholders and will take into account the outcome of this vote in considering future compensation arrangements. It is expected that the next say-on-pay vote will occur at the 2018 annual meeting.
Proposals Requiring Your Vote |Proposal 3 — Advisory Vote to Approve the Frequency with which the Advisory Vote to Approve Named Executive Officer Compensation Should Be Held
Proposal 3 — Advisory Vote to Approve the Frequency with which the Advisory Vote to Approve Named Executive Officer Compensation Should Be Held
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We are asking stockholders to indicate how frequently we should seek an advisory vote on the compensation of our named executive officers (i.e., the frequency of a say-on-pay vote). This proposal is commonly known as a “say-on-frequency” proposal. Stockholders may indicate whether they would prefer an advisory vote on executive compensation every year, every two years, or every three years, or they may abstain from voting on this proposal. We have historically solicited an advisory vote on executive compensation every year, and the Board believes that continuing to hold such a vote every year is advisable for a number of reasons, including the following:
Stockholders are not voting to approve or disapprove the Board’s recommendation. Instead, you may cast your vote on your preferred voting frequency by choosing any of the following four options with respect to this proposal: “every year,” “every two years,” “every three years,” or “abstain.” For the reasons discussed above, we are asking our stockholders to vote for a frequency of “every year.”
The say-on-frequency vote is advisory and therefore not binding on the Company, the Board, or the Compensation Committee. The Board and the Compensation Committee value the opinions of our stockholders and will take into account the outcome of this vote in considering the frequency with which the advisory vote on compensation of our named executive officers will be held in the future.
Proposals Requiring Your Vote |Proposal 4 — Ratification of Appointment of Independent Auditors
Proposal 4 — Ratification of Appointment of Independent Auditors
Audit Matters
The Audit Committee is responsible for the appointment, compensation, retention, and oversight of the independent auditors retained to audit our consolidated financial statements. We have appointed PricewaterhouseCoopers LLP (“PwC”) as our independent auditors for the fiscal year ending December 31, 2022. PwC has served as our auditors since 1997. In order to assure continuing auditor independence, the Audit Committee periodically considers whether there should be a regular rotation of the independent audit firm. Further, in conjunction with the mandated rotation of the independent audit firm’s lead engagement partner, the Audit Committee will continue to be directly involved in the selection and evaluation of PwC’s lead engagement partner. The Board and the Audit Committee believe that the continued retention of PwC to serve as our independent auditors is in the best interests of eBay and our stockholders. We expect that representatives of PwC will be present at the Annual Meeting, will have an opportunity to make a statement if they wish, and will be available to respond to appropriate questions. Our bylaws do not require the stockholders to ratify the appointment of PwC as our independent auditors. However, we are submitting the appointment of PwC to our stockholders for ratification as a matter of good corporate practice. If the stockholders do not ratify the appointment, the Audit Committee will reconsider whether or not to retain PwC. Even if the appointment is ratified, the Audit Committee, in its discretion, may change the appointment at any time during the year if it determines that such a change would be in the best interests of eBay and our stockholders. |
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The Audit Committee is responsible for the appointment, compensation, retention, and oversight of the independent auditors retained to audit our consolidated financial statements. We have appointed PricewaterhouseCoopers LLP (“PwC”) as our independent auditors for the fiscal year ending December 31, 2017. PwC has audited our historical consolidated financial statements for all annual periods since our incorporation in 1996. In order to assure continuing auditor independence, the Audit Committee periodically considers whether there should be a regular rotation of the independent audit firm. Further, in conjunction with the mandated rotation of the independent audit firm’s lead engagement partner, the Audit Committee will continue to be directly involved in the selection and evaluation of PwC’s lead engagement partner. The Board and the Audit Committee believe that the continued retention of PwC to serve as our independent auditors is in the best interests of eBay and our stockholders. We expect that representatives of PwC will be present at the Annual Meeting, will have an opportunity to make a statement if they wish, and will be available to respond to appropriate questions.
Our Bylaws do not require the stockholders to ratify the appointment of PwC as our independent auditors. However, we are submitting the appointment of PwC to our stockholders for ratification as a matter of good corporate practice. If the stockholders do not ratify the appointment, the Audit Committee will reconsider whether or not to retain PwC. Even if the appointment is ratified, the Audit Committee, in its discretion, may change the appointment at any time during the year if it determines that such a change would be in the best interests of eBay and our stockholders.www.ebayinc.com 37
Audit and Other Professional Fees
During the fiscal years ended December 31, 20162021 and December 31, 2015,2020, fees for services provided by PwC were as follows (in thousands):
Year Ended December 31, | ||||||||||
2016 | 2015 | |||||||||
Audit Fees (1) | $ | 9,362 | $ | 15,951 | ||||||
Audit-Related Fees | 1,609 | 1,447 | ||||||||
Tax Fees | 70 | 280 | ||||||||
All Other Fees (2) | 512 | 2,360 | ||||||||
Total | $ | 11,553 | $ | 20,038 |
Year Ended December 31, | ||||||||
2021 | 2020 | |||||||
Audit Fees | $ | 12,350 | $ | 19,481 | ||||
Audit-Related Fees | 375 | — | ||||||
Tax Fees | 2,037 | 4,500 | ||||||
All Other Fees(1) | 84 | 588 | ||||||
Total | $ | 14,846 | $ | 24,569 |
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For | |
“Audit Fees” consist of fees incurred for services rendered for the audit of eBay’s annual financial statements, review of financial statements included in eBay’s quarterly reports on Form 10-Q, other services normally provided in connection with statutory and regulatory filings, for attestation services related to compliance with the Sarbanes-Oxley Act of 2002, and services rendered in connection with securities offerings. “Audit-Related Fees” consist of fees incurred for due diligence procedures in connection with acquisitions and divestitures and consultation regarding financial accounting and reporting matters. “Tax Fees” consist of fees incurred for transfer pricing consulting services, tax planning and advisory services, and tax compliance services. “All Other Fees” consist of fees incurred for permitted services not included in the category descriptions provided above with respect to “Audit Fees,” “Audit-Related Fees,” and “Tax Fees,” and include fees for consulting services, compliance-related services, and software licenses, as well as the lease payments described above.
Proposals Requiring Your Vote |Proposal 4 — Ratification of Appointment of Independent Auditors
The Audit Committee has determined that the non-audit services rendered by PwC were compatible with maintaining its independence. All such non-audit services were pre-approved by the Audit Committee pursuant to the pre-approval policy set forth below.
The Audit Committee has adopted a policy requiring the pre-approval of any non-audit engagement of PwC. In the event that we wish to engage PwC to perform accounting, technical, diligence, or other permitted services not related to the services performed by PwC as our independent registered public accounting firm, our internal finance personnel will prepare a summary of the proposed engagement, detailing the nature of the engagement, the reasons why PwC is the preferred provider of such services, and the estimated duration and cost of the engagement. This information will be provided to our Audit Committee or a designated Audit Committee member, who will evaluate whether the proposed engagement will interfere with the independence of PwC in the performance of its auditing services and decide whether the engagement will be permitted.
On an interim basis, any non-audit engagement may be presented to the Chair of the Audit Committee for approval and to the full Audit Committee at its next regularly scheduled meeting.
We have taken a number of steps to ensure continued independence of our outside auditors. Our independent auditors report directly to the Audit Committee, and we limit the use of our auditors for non-audit services. The fees for services provided by our auditors in 2020 and 2021 and our policy on pre-approval of non-audit services are described above.
38 ebay / 2022 Proxy Statement
We constitute the Audit Committee of the Board. The Audit Committee’s responsibility is to provide assistance and guidance to the Board in fulfilling its oversight responsibilities to eBay’s stockholders with respect to:
The Audit Committee members are not professional accountants or auditors, and these functions are not intended to replace or duplicate the activities of management or the independent auditors. Management has primary responsibility for preparing the financial statements and designing and assessing the effectiveness of internal control over financial reporting. Management and the internal auditing departmentaudit function are responsible for maintaining appropriate accounting and financial reporting principles and policies and internal controls and procedures that provide for compliance with accounting standards and applicable laws and regulations.
PwC, eBay’s independent auditors, areis responsible for planning and carrying out an audit of eBay’s financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”) and eBay’s internal control over financial reporting, expressing an opinion on the conformity of eBay’s audited financial statements with generally accepted accounting principles (“GAAP”) as well as the effectiveness of eBay’s internal control over financial reporting, reviewing eBay’s quarterly financial statements prior to the filing of each quarterly report on Form 10-Q, and other procedures.
During 20162021 and in early 2017,2022, in connection with the preparation of eBay’s Annual Report on Form 10-K for the year ended December 31, 2016,2021, and in fulfillment of our oversight responsibilities, we did the following, among other things:
Proposals Requiring Your Vote |Proposal 4 — Ratification of Appointment of Independent Auditors
www.ebayinc.com 39
Our Audit Committee held nineeight meetings in 2016.2021. Throughout the year, we conferred with PwC, eBay’s internal audit team,function, and senior management in separate executive sessions to discuss any matters that the Audit Committee, PwC, the internal audit team,function, or senior management believed should be discussed privately with the Audit Committee. We have direct and private access to both the internal and externalindependent auditors of eBay.
We have discussed with PwC the matters required to be discussed by the statement on Auditing Standards No. 16 (Communication with Audit Committees).applicable requirements of the PCAOB and the SEC. The Audit Committee has also received the written disclosures and thea letter from PwC required by the applicable Public Company Accounting Oversight BoardPCAOB requirements for independent accountant communications with audit committees concerning auditor independence, and has discussed the independence of PwC with that firm. We have concluded that PwC’s provision to eBay and its affiliates of the non-audit services reflected under “Audit-Related Fees,” “Tax Fees,” and “All Other Fees” above is compatible with PwC’s obligation to remain independent.
We have also established procedures for the receipt, retention, and treatment of complaints received by eBay regarding accounting, internal accounting controls, or auditing matters and for the confidential anonymous submission by eBay employees of concerns regarding questionable accounting or auditing matters.
After reviewing the qualifications of the current members of the Audit Committee, and any relationships they may have with eBay that might affect their independence from eBay, the Board determined that each member of the Audit Committee meets the independence requirements of The NASDAQNasdaq Stock Market and of Section 10A of the Exchange Act, that each member is able to read and understand fundamental financial statements, and that Mr. AndersonMessrs. Swan and Traquina and Ms. Hayles each qualifies as an “audit committee financial expert” under the applicable rules promulgated pursuant to the Exchange Act. The Audit Committee operates under a written charter adopted by the Board. The current Audit Committee Charter is available on the corporate governance section of eBay’s investor relations website at https://investors.ebayinc.com/corporate-governance.cfm. corporate-governance/governance-documents/.
Any future changes in the Audit Committee charter or key practicesCharter will also be reflected on the website.
Based on ourthe reviews and discussions described above, we recommended to the Board, and the Board approved, the inclusion of the audited financial statements in eBay’s Annual Report on Form 10-K for the year ended December 31, 2016,2021, which eBay filed with the SEC on February 6, 2017.24, 2022. We have also approved the appointment of PwC as our independent auditors for the fiscal year ending December 31, 2017.2022.
AUDIT COMMITTEE
Audit Committee
Matthew J. Murphy | ||||
Perry M. Traquina |
40 ebay / 2022 Proxy Statement
Proposals Requiring Your Vote |Proposal 5 — Stockholder Proposal regarding Right to Act by Written Consent
Proposal 5 — Stockholder Proposal regarding Right3 Advisory Vote to Act by Written ConsentApprove Named Executive Officer Compensation
Executive Compensation
In accordance with the requirements of Section 14A of the Exchange Act, we are asking stockholders to approve, on an advisory basis, the compensation of our named executive officers as described in the Compensation Discussion and Analysis, compensation tables, and related narrative discussion of such compensation included in this Proxy Statement. As discussed in the Compensation Discussion and Analysis, the Compensation and Human Capital Committee of the Board is committed to an executive compensation program that is aligned with our business goals, culture, and stockholder interests. We believe a competitive compensation program that is highly performance-based is key to delivering long-term stockholder returns. The Compensation and Human Capital Committee believes that the goals of our executive compensation program are appropriate and that the program is properly structured to achieve those goals, particularly in light of our annual evaluation of, and periodic refinements to, the program. We have engaged in ongoing discussions with our investors, who generally support those goals and the program, and we believe our stockholders as a whole should support them as well. We are asking our stockholders to indicate their support for the compensation of our named executive officers as described in this Proxy Statement. This proposal, commonly known as a “say-on-pay” proposal, gives our stockholders the opportunity to express their views on the compensation of our named executive officers. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our named executive officers and the philosophy, policies, and practices described in this Proxy Statement. Accordingly, we ask our stockholders to vote “FOR” the following resolution at the Annual Meeting: “RESOLVED, that the Company’s stockholders approve, on an advisory basis, the compensation of the named executive officers, as disclosed in the Company’s Proxy Statement for the 2022 Annual Meeting of Stockholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the 2021 Summary Compensation Table, and the other related tables and disclosures.” While the say-on-pay vote is advisory, and therefore not binding on the Company, the Board and the Compensation and Human Capital Committee value the opinions of our stockholders and will take into account the outcome of this vote in considering future compensation arrangements. It is expected that the next say-on-pay vote will occur at the 2023 Annual Meeting. |
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John Chevedden, whose address is 2215 Nelson Avenue, Redondo Beach, California, has advised the Company that he intends to present the following stockholder proposal at the 2017 Annual Meeting. Mr. Chevedden has indicated that he holds no fewer than 100 shares of eBay common stock.
The text of the stockholder proposal and supporting statement appear exactly as received by eBay unless otherwise noted. All statements contained in the stockholder proposal and supporting statement are the sole responsibility of the proponent. The stockholder proposal may contain assertions about the Company or other matters that we believe are incorrect, but we have not attempted to refute all of those assertions.
The stockholder proposal will be voted on at the 2017 Annual Meeting only if properly presented by or on behalf of the proponent. Adoption of this proposal requires the affirmative vote of a majority of the shares present in person or represented by proxy. Abstentions will be counted as present for purposes of this vote and therefore will have the same effect as a vote against this stockholder proposal. Broker non-votes will not be counted as present and are not entitled to vote on this proposal.
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42 ebay / 2022 Proxy Statement
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The Board has carefully considered this proposal and does not believe that it is in the best interests of eBay and its stockholders. The Board therefore recommends a voteAGAINST this proposal.
Proposals Requiring Your Vote |Proposal 5 — Stockholder Proposal regarding Right to Act by Written Consent
eBay regularly engages with and solicits the feedback of its stockholders and is proud of its track record of responsiveness to stockholders. The Board is committed to good corporate governance and believes in maintaining policies and practices that serve the interests of all stockholders. We understand that corporate governance is not static – we monitor and evaluate trends and developments in corporate governance and compare and evaluate them against our current practices. The Board recognizes that some stockholders may view the ability to act by written consent as an important right. However, the Board believes that eBay’s existing Bylaw provision that provides stockholders with the right to call special meetings offers a transparent and equitable mechanism for stockholders to raise matters for consideration by the Company, whereas this proposal’s written consent right would enable a limited group of stockholders to act without the same required transparency to all stockholders.
The Board recommends that stockholders vote against this proposal because it believes the written consent process, as set forth in this proposal, is less transparent and less democratic than holding a stockholders meeting, and thus deprives stockholders of a forum for discussion or opportunity to ask questions about proposed actions. Matters that are so important as to require stockholder approval should be communicated in advance so they can be considered and voted upon by all stockholders. This proposal would allow a group of stockholders to take action by written consent without prior communication to all stockholders of the proposed action or reasons for the action. The Board believes that, if implemented, this proposal would disenfranchise stockholders who will not have the opportunity to participate in the process.
eBay’s stockholders have the right to call a special meeting at a twenty-five percent threshold, which is the most common threshold among S&P 500 companies that provide their stockholders with that right. This threshold is half of what would be necessary for stockholders to act by written consent under this proposal. Therefore, any coalition of stockholders proposing to act by written consent could call a special meeting. This right to call a special meeting, along with our established stockholder communication and engagement practices, provides stockholders with opportunities to raise important matters and propose actions for stockholder consideration outside the annual meeting process.
Stockholder meetings offer important protections and advantages that are absent from the written consent process under this proposal. The protections and advantages of stockholder meetings include:
In contrast, adoption of this proposal would make it possible for the holders of a bare majority of shares of eBay common stock outstanding to take significant corporate actions without any prior notice to the Company, the Board or the other eBay stockholders – actions that may have important ramifications for both eBay and its stockholders. This approach would effectively disenfranchise all of those stockholders who do not have (or are not given) the opportunity to participate in the written consent.
Proposals Requiring Your Vote |Proposal 5 — Stockholder Proposal regarding Right to Act by Written Consent
The Board also believes that eBay’s strong corporate governance practices make adoption of this proposal unnecessary. In addition to giving stockholders the right to call special meetings, eBay has many other governance provisions that protect and empower stockholders, including:
In summary, the Board believes the adoption of this proposal is unnecessary because of eBay’s commitment to good corporate governance, the right of stockholders to call special meetings and the ability of stockholders to nominate directors through proxy access. The Board also believes that this written consent proposal would circumvent the protections, procedural safeguards and advantages provided to all stockholders by stockholder meetings.
Dear eBay Stockholders, Through the uncertainty of |
Unless you specify otherwise, the Board intends the accompanying proxy to be voted against this item.
Our Executive Officers
Executive officers are appointed annually by the Board and serve at the discretion of the Board. Set forth below is information regarding our executive officers as of March 20, 2017.
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| Pay for Performance We are proud that the Company achieved results well above our targets for 2021, led by the exemplary leadership demonstrated by Jamie and his team. Through a transformational period, they drove outstanding performance against each of our current business objectives all while refining the strategic vision we believe will deliver value long into the future. We believe the compensation paid for performance in 2021 is appropriate and meets the objectives of retaining and motivating our leaders while assuring that they focus on long-term performance. Responsive to Shareholders While the Company continues to evolve, our core values remain constant. We are committed to diversity of thoughts, backgrounds, ideas and opinions because we believe our shared purpose benefits from a multiplicity of viewpoints. This includes our solicitation of feedback from our stockholders through regular engagement efforts and outreach initiatives, as | |||||||
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Message from the Compensation Committee
Continuous Improvement We
Commitment to Sustainability As the Compensation and Human Capital Committee of your Board of Directors, emphasizing the importance of sustainability through annual incentives was just one example of our commitment to sustainable business practices in 2021 – we also took the important step of expanding the role of the Committee to formally include broad oversight of human capital management. In this capacity, we have planned with the executive leadership team to engage in a regular cadence of discussions throughout the year on critical matters such as diversity, equity & inclusion, pay equity and management development. It is our goal to advise and empower the management team to ensure that eBay takes a leadership position and that our culture continues to be
2022. |
Compensation and Human Capital Committee
(Chair) | Anthony J. Bates | Logan D. Green |
| Kathleen C. Mitic | Paul S. Pressler |
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Compensation Discussion and Analysis |Executive Summary
Compensation Discussion and Analysis
This Compensation Discussion and Analysis describes the compensation of our “named executive officers” (“NEOs”) for 2021:
Jamie Iannone, President and Chief Executive Officer (“CEO”) Steve Priest, Chief Financial Officer (“CFO”)(1) Cornelius Boone, Senior Vice President, Chief People Officer(2) Julie Loeger, Senior Vice President, Chief Growth Officer(3) Peter B. Thompson, Senior Vice President, Chief Product Officer(4) Andy Cring, former Interim Chief Financial Officer(5) Kristin Yetto, former Chief People Officer(6) |
(1) | Mr. Priest joined as CFO in June 2021. |
(2) | Mr. Boone joined as Chief People Officer in February 2021. |
(3) | Ms. Loeger joined as Chief Growth Officer in January 2021. |
(4) | Mr. Thompson will be leaving the Company and is expected to transition from his role on or about April 29, 2022. |
(5) | Mr. Cring served as Interim Chief Financial officer from September 2019 until June 2021 and then served as an advisor until October 2021. |
(6) | Ms. Yetto stepped down from her role in January 2021 and then served as a senior advisor until March 2021. |
Executive Summary
Following the 2015 Spin-Off of PayPal, we conducted an extensive review of the Company’s compensation philosophy andWithin our executive compensation program, for 2016 to determine whether they continued to be properly aligned with our business goals, culture, and importantly, stockholder interests. Following this review, the Compensation Committee and our CEO remained committed to our existing executive compensation program, which is designedwe strive to align with our business goals and culture, serves the long-term interests of our stockholders and is highlyour executives. We also believe in creating incentives that reflect our pay-for-performance philosophy, both in periods of success and during years where our financial performance based.falls short of our targets. In our view, our compensation practices, including incentive compensation, play an important role in reinforcing our performance-driven culture. 2021 was an extraordinary year of change for the Company with the global pandemic influencing changes in consumer behavior. Due in large part to the strategies of and execution under Mr. Iannone’s leadership, the Company significantly exceeded short-term and long-term financial performance targets for the year. Notable achievements of the management team in 2021 include:
Consistent with our pay-for-performance philosophy, our incentive compensation programs rewarded our NEOs for this success. As discussed in more detail below, payouts for our 2020-2021 long-term, performance-based equity program and 2021 annual cash incentive plan were above target. We believe these payouts correlate with shareholder value creation.
44 ebay / 2022 Proxy Statement
Executive Transitions
Following the departure of our prior CEO, an independent committee of the Board led the search to identify the right candidate to lead the Company’s next chapter of growth and success, which concluded with the appointment of new CEO, Jamie Iannone, in April 2020. Aligned with our long-term vision to further our transformation, in the first half of 2021, we recruited new members of the executive leadership team, including a new Chief Financial Officer, Chief People Officer, Chief Growth Officer, and Chief Business and Strategy Officer, to solidify a world-class leadership team that is laser focused on our pay-for-performance driven executivebuyers and sellers and delivering sustainable growth.
New-Hire Compensation.The new-hire compensation packages of the executives who joined the Company in 2021 include customary elements of our compensation program ensures(salary, annual cash incentive and target long-term equity incentives), as well as one-time, transition compensation components. In designing these packages, the Compensation and Human Capital Committee focused on developing compelling compensation packages, consistent with our pay for performance philosophy that would reward for creating shareholder value in both the short and long term. These components were designed to entice the executives to join eBay, to deliver take-home compensation in the first year of employment approximating target compensation for the given role within our executives’ compensation is tiedpeer group and to delivering results that supportcompensate for value they forfeited when leaving prior employment. For details, please see 2021 NEO Target Compensation – Determining 2021 Compensation for Our NEOs.
Severance Arrangements.During 2021, our incumbent Chief People Officer and interim Chief Financial Officer departed the Company. The severance arrangements for Ms. Yetto (who participated in a legacy arrangement, which was appropriate at the time to attract and retain executives prior to our separation from PayPal), Mr. Cring (who was provided an arrangement as an officer below the SVP level while serving as interim CFO) and our continuing NEOs reflect the evolution of our approach, culminating with the Company’s business strategycurrent Standard Severance Plan. Each of the continuing NEOs participate in the Standard Severance Plan, which we believe is appropriate for the market for talent that we compete in today. We discuss the terms of severance arrangements below in Severance and objectives.Change in Control Arrangements with Executive Officers and Clawbacks.
Compensation Design Changes for 2022
During a period of evolution, including leadership transitions, our compensation plans provided flexibility to make decisions to address the changes in our business. We evaluate plan designs annually to determine their appropriateness and have implemented the following changes for 2022.
PBRSUs. Our Performance-Based Restricted Stock Units (PBRSUs) have historically been earned based on financial performance over a two-year period, subject to additional time vesting. Based on a desire to both extend the performance period to three years and incorporate a metric related to stock price performance against peers, and feedback from shareholders, the Committee added a three-year relative total shareholder return modifier to the PBRSUs awarded to our NEOs. The Committee also modified the performance periods for the core financial measures from a two-year period to a series of three one-year periods to better align with management’s annual financial planning.
Performance Options.In addition to Restricted Stock Units (RSUs) and PBRSUs, which historically comprised 40% and 60% of equity compensation awarded to our NEOs, the Committee determined to allocate a percentage of target equity value to performance-vesting stock options. These stock options will only vest over a three-year performance period if predetermined operational goals and time-based vesting are satisfied. As a result, the target equity value will be comprised of 40% RSUs, 40% PBRSUs, and 20% performance-vesting stock options.
eIP.The assessment of our executive leadership team’s performance will continue to include ESG factors related to sustainability and DE&I goals, as well as a customer satisfaction (CSAT) measure that can increase payouts based on performance.
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Our Compensation Program
The goalsobjectives of our executive compensation program are to:
align compensation with our business objectives, performance and stockholder interests, | |
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position us competitively among the companies against which we recruit and compete for talent, and | |
enable us to attract, reward and retain executive officers and other key employees who contribute to our long-term success. |
We achieve these objectives primarily by employing the followingcore elements of pay for our executive officers:compensation programs as illustrated in the graphic below.
How We Pay Our CEO
The following graphics illustrate the predominance of equity incentives and performance-based components in Mr. Iannone’s 2021 target pay mix in our core compensation program. In addition to annual and long-term incentives in line with our core compensation program, in 2021, Mr. Iannone also received a cash incentive, and
Mr. Iannone’s compensation is highly weighted to Company performance. Over 94% of his 2021 compensation is based on Company performance goals or is otherwise subject to stock price volatility. | |||
2021 Target Compensation | |||
Base Salary | $ 1,000,000 | ||
Annual Cash Incentive (eIP) | $ 2,000,000 | ||
Equity Awards | $15,000,000 | ||
Total Target Compensation | $18,000,000 |
46 ebay / 2022 Proxy Statement
Our
Pay for Performance
In 2021, we continued to compensate our executive officers also participate in our broad-based retirement savings and benefit programs and receive limited perquisites.
For 2016, we chose to continue to useusing a mix of equity and cash compensation vehicles to compensate our executive officers. We also decided to increase the weight of performance-based restricted stock units (“PBRSUs”) and eliminate the use of stock options.vehicles. Our incentive compensation is dependent ontied to financial targets that the Compensation and Human Capital Committee believes correlate with operating performance over one- and multi-year performance periods and long-term stock performance. Performance targets are generally set in a manner consistent with the current year budget and multi-year strategic plan.
Plan | Performance Metrics | Compensation and Human Capital Committee Rationale |
Annual Cash Incentive (eIP) | •FX-neutral revenue (threshold) •Non-GAAP net income •Individual performance | •A revenue threshold must be met before any incentive is paid •Non-GAAP net income is directly affected by management decisions and provides the most widely followed measure of financial performance •Differentiate compensation based on individual contributions, including ESG factors |
PBRSUs | •FX-neutral revenue •Non-GAAP operating margin dollars •ROIC Modifier | •Key drivers of our long-term success and stockholder value, and directly affected by management decisions •Incentivizes profitable growth and efficient use of capital |
38Annual Cash Incentive Plan Financial Goals and Plan Performance
The following graphs show the goals and results achieved for the 2021 performance period under the financial component of our eIP, which accounted for 75% of our NEOs’ award opportunities. In 2021, the eIP’s financial performance goals were adjusted to exclude the impacts of eBay Korea, which was sold in November 2021, and the goals set did not include eBay Classifieds, which was classified as discontinued operations following the agreement to transfer it to Adevinta in July 2020.
As discussed above, driven by the impacts of the pandemic and management performance, the Company exceeded financial expectations in 2021. FX-Neutral revenue surpassed the threshold requirement of the eIP, and Non-GAAP net income performance was greater than the maximum performance hurdle. As a result, the financial component of the eIP paid out at 200% of target.
Historical eIP Payouts
The graphic below shows the average payout (as a percentage of target award values) for the financial component of the eIP for the prior three plan years. eIP payouts have remained tightly correlated to performance. Specifically, in 2018, the eIP financial component paid out at 78% when the FX-neutral revenue threshold was achieved and non-GAAP net income was below target. In both 2019 and 2020, the eIP financial component paid out above target when the FX-neutral revenue thresholds and non-GAAP net income targets were exceeded.
Average payout for prior three years | 133% |
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PBRSU Financial Goals and Performance
The following graphs show the goals and results achieved for the 2020-2021 performance period, which were used to calculate the performance vesting of PBRSUs at the end of the two-year performance period. Like the eIP performance goals, the PBRSU performance goals were adjusted to exclude eBay Korea (for 2021) and eBay Classifieds (for 2020 and 2021).
2020-2021 PBRSU Financial Results
The Company’s financial performance dramatically exceeded expectations over the course of the 2020-2021 PBRSU performance period. Both FX-neutral revenue and Non-GAAP operating margin surpassed the maximum performance levels required by the Compensation and Human Capital Committee to earn the maximum 200% base payout. In addition, performance relative to the measure for the return on invested capital modifier yielded upward adjustments to the base payout percentage. As a result, the final payout percentage for this cycle of PBRSUs was 240% of the target awards.
Historical PBRSU Payouts
Throughout the history of the PBRSU program, payouts have remained tightly correlated to performance. The graphic below shows the average payout for the three PBRSU cycles prior to the recently completed 2019-2020 PBRSU cycle, specifically 86% payouts for the 2017-2018 and 2018-2019 cycles when the Company fell short of both target goals and 316% for the 2019-2020 cycle when the Company exceeded both target goals and strong performance against a modifier goal related to the Company’s managed payments initiative increased the payout percentage.
Average payout for prior three years | 163% |
48 ebay / 2022 Proxy Statement
Say-on-Pay Results and Stockholder Engagement
Historically, stockholders have overwhelmingly approved our executive compensation program through the “say-on-pay” vote, with average support above 90% in 2018, 2019 and 2020. At our 2021 Annual Meeting, however, support of 71% was below the level that we strive to achieve. The Committee takes this feedback seriously. Through our engagement process we heard that our stockholders generally support our executive compensation program and the decisions we have made under the program. We also heard requests for additional disclosure regarding the rationale for new-hire packages and severance arrangements for former executives, and we responded to these requests in this Compensation Discussion and Analysis.
We regularly review the Company’s compensation philosophy and executive compensation program to assess whether they continue to be properly aligned with our business goals, culture and, importantly, stockholder interests. We also engage with our stockholders at least twice a year to solicit feedback on our compensation philosophy and executive compensation program. In 2021, the Committee reviewed our programs on numerous occasions to ensure that our programs continue to support eBay’s business strategy. After conducting these reviews and considering the feedback received from stockholders, we determined that the Company’s executive compensation philosophy, compensation objectives, and overall program continue to be appropriate. With the introduction of the modifications approved during 2021 and 2022 (described in the Executive Summary on page 45), the Compensation and Human Capital Committee determined that the core elements of our executive compensation program should remain in place.
Our Compensation Practices
We believe our compensation practices align with and support the goals of our executive compensation program and demonstrate our commitment to sound compensation and governance practices.
What We Do | What We Don’t Do | ||
Align executive compensation with the interests of our stockholders | No tax gross-ups for change in control benefits No automatic “singletrigger” acceleration of equity awards upon a change in control No repricing or buyout of underwater stock options without stockholder approval No hedging and pledging transactions | ||
• Pay-for-performance emphasized • Majority of total compensation comprises performance-based compensation • Equity/cash compensation mix significantly favors equity • Meaningful stock ownership requirements | |||
Avoid excessive risk-taking | |||
• Robust clawback policy • Multiple performance measures, caps on incentive payments, and overlapping long-term performance periods for PBRSU awards | |||
Adhere to compensation best practices | |||
• Compensation benchmarked at or around the 50th percentile of peer group • Independent compensation consultant engaged • Limited perquisites for executive officers that are not available to all employees | |||
CD&A Roadmap
Our Compensation Discussion and Analysis |Executive Summaryis presented as follows:
1. | Elements of Our Executive Compensation Programprovides a description of our executive compensation practices, programs, and processes. |
2. | 2021 NEO Target Compensationdiscusses how we determine the mix of the elements in our compensation program to achieve our total target compensation. |
3. | 2021 Compensation Design and Determinationsexplains executive compensation decisions relating to the performance-based pay of our executive officers in 2021. |
4. | Further Considerations for Setting Executive Compensationdiscusses the role of the Company’s compensation consultant, peer group considerations, and the impact of accounting and tax requirements on compensation. |
5. | Severance and Change in Control Arrangements with Executive Officers and Clawbacksdiscusses the Company’s severance and change in control plans and other arrangements with executive officers. |
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1. | Elements of Our Executive Compensation Program |
The following chart showsprovides a summary of the breakdowncore elements of 2016our 2021 executive compensation program.
We chose a mix of equity and cash compensation vehicles to compensate executive officers based on sustainable long-term value drivers of Company performance over one- and multi-year periods and individual contributions to the Company.
50 ebay / 2022 Proxy Statement
Our executive officers were also eligible to receive a comprehensive set of benefits:
We provide certain executive officers with limited perquisites and other personal benefits not available to all employees (such as IT and security services for our CEO, Devin Wenig,CEO), that we believe are reasonable and illustratesconsistent with our overall compensation program and philosophy. These benefits are provided to enable the predominanceCompany to attract and retain these executive officers. We periodically review the levels of equity incentivesthese benefits provided to our executive officers.
The Compensation and performance-based componentsHuman Capital Committee encouraged Mr. Iannone to use the corporate airplane for personal travel to reduce possible security concerns. The Company does not grant bonuses to cover, reimburse, or otherwise “gross-up” any income tax owed for personal travel on the corporate airplane. We provide relocation assistance to executive officers, when applicable, and the Company’s does reimburse executives for related taxes owed.
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2. | 2021 NEO Target Compensation |
When making compensation decisions for our NEOs, the Compensation and Human Capital Committee evaluated each individual based on his or her leadership, competencies, innovation, and both past and expected future contributions toward the Company’s financial, strategic, and other priorities. The Company’s performance was reflected in our executive compensation program.
DEVIN WENIGprogram, holding leadership accountable for Company performance.
Long-Term Equity Incentive Compensation
The value of annual equity awards is determined within guidance that the Compensation and Human Capital Committee reviews on an annual basis for each position. This guidance is based on our desired pay positioning relative to companies with which we compete for talent. The midpoint of the guidance, or the median target award, reflects the 50th percentile of the competitive market.
In 2021, the Compensation and Human Capital Committee reviewed equity award guidance by position based on the following:
The Compensation and Human Capital Committee is also cognizant of dilution of our shareholders resulting from equity compensation, and it carefully considers share usage each year.
Each executive officer’s individual contribution and impact, projected level of contribution and impact in the future, and competitive positioning are considered using a scorecard when determining individual awards. The score card evaluates each executive with respect to factors, including business unit performance (or in the case of our CEO, Company performance), organizational development, and strategic and operational excellence. The retention value of current year awards and the total value of unvested equity from previous awards are also considered.
Based on CEO assessments and the scorecard evaluation, the Compensation and Human Capital Committee approved individual compensation arrangements for each NEO based on the factors and guidelines described above and in this section.
Annual Cash Incentive Compensation
The Compensation and Human Capital Committee also assesses annual cash incentive award opportunities against data from public filings of our peer group companies and general industry data for comparable technology companies that are included in proprietary third-party surveys, and it approves target annual cash incentive opportunities for our NEOs in a range around the 50th percentile based on that data. The Compensation and Human Capital Committee reviews market data annually, and periodically adjusts incentive opportunities to the extent necessary where our practices are inconsistent with such market data.
Base Salary
The Compensation and Human Capital Committee reviews market data annually and approves each executive officer’s base salary for the year. Increases, if any, generally become effective on or around April 1st of the year. The Compensation and Human Capital Committee assesses competitive market data on base salaries from public filings of our peer group companies and general industry data for comparable technology companies that are included in proprietary third-party surveys. When considering the competitive market data, we also recognize that the data is historical and does not necessarily reflect those companies’ current pay practices. The Compensation and Human Capital Committee assesses each executive officer’s base salary against the 50th percentile of the salaries paid to comparable executives at peer group companies and also consider individual performance, levels of responsibility, expertise, and prior experience in our evaluation of base salary adjustments.
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Target Value of Equity Awards, Target Cash Incentive Award and Salary for NEOs
The Compensation and Human Capital Committee considered many factors in approving the various components of the our NEOs’ compensation, including those set forth below, using a score card as described above. In evaluating performance against these factors, the Compensation and Human Capital Committee assigned no specific weighting to any one of the factors, instead evaluating individual performance in a holistic manner:
The Compensation and Human Capital Committee reviewed and approved the target value of equity awards, target annual cash incentive award, and salary for our NEOs based on available market data as well as Company and individual performance.
With the Board’s appointment of Mr. Cring to the Interim CFO role, the Compensation and Human Capital Committee focused on incentivizing him for leading the Company during the transition while remaining committed to the philosophy of tying compensation to Company performance. With respect to Mr. Cring, starting in October 2019, we implemented a special pay structure in the form of monthly performance bonus in the amount of $70,000, which was designed to align his cash compensation to his interim role. In July 2020, with a view to retention during our search for a permanent CFO, we entered into a letter agreement with Mr. Cring, which provided for enhanced severance benefits, including a $2,000,000 cash payment to Mr. Cring if he remained employed with eBay through June 1, 2021 or his employment was terminated without cause prior to that date.
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The following table shows target compensation for our NEOs (disregarding supplemental transition awards described below):
Name | 2021 Annual Base Salary | Year- Over-Year Change for Base Salary (%) | 2021 Target Annual Cash Incentive Award (% of Salary) | Year-Over- Year Change for Target Annual Cash Incentive Award (%) | 2021 Target Value of Equity Awards ($) | Year-Over- Year Change for Target Value of Equity Awards (%) | ||||||||
Mr. Iannone | $ | 1,000,000 | No Change | 200% | No Change | $ | 15,000,000 | (2) | 25% | |||||
Mr. Priest | $ | 750,000 | N/A | 100% | N/A | $ | 7,000,000 | (2) | N/A | |||||
Mr. Boone | $ | 645,000 | N/A | 65% | N/A | $ | 4,500,000 | (2) | N/A | |||||
Ms. Loeger | $ | 650,000 | N/A | 75% | N/A | $ | 4,000,000 | (2) | N/A | |||||
Mr. Thompson | $ | 645,000 | No Change | 75% | 15% | $ | 5,000,000 | (2) | No Change | |||||
Mr. Cring | $ | 455,000 | (1) | No Change | 55% | No Change | $ | 3,000,000 | (3) | 20% | ||||
Ms. Yetto | $ | 695,000 | No Change | 75% | No Change | N/A | (4) | N/A |
(1) |
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As discussed above,
(2) | Includes 60% PBRSUs and 40% time-based RSUs. |
(3) | Reflects 100% RSUs since Mr. Cring was not eligible for the PBRSU program due to his position as a VP. |
(4) | Ms. Yetto departed the Company prior to receiving an annual equity grant in 2021. |
Supplemental Transition Awards
The 2021 Compensation packages for the NEOs who joined the Company in 2020 and 2021 include customary elements of our compensation program (salary, annual cash incentive and equity incentives consisting of 40% RSUs and 60% PBRSUs). In addition, in 2021, their compensation packages included transition compensation components, including supplemental cash compensation (paid over multiple years) and new-hire RSU awards. These components were designed to entice the NEOs to join eBay, to deliver take-home compensation in the first years of employment approximating target compensation for their roles in our peer group and to compensate for value they forfeited when leaving their prior employers. We describe the design of each of these compensation elements paid in 2021 in more detail below.
New-Hire Equity Transition Payments (Cash).New NEOs received an equity transition/buyout payment in the first years of employment. These payments are typically subject to repayment upon termination of employment for cause or resignation other than for good reason, prior to the second anniversary of their applicable hire date, less 1/24th for every full month of active employment following their hire date. In 2021, the new NEOs received the following amounts in new-hire cash payments: $1,500,000 (Mr. Iannone), $2,250,000 (Mr. Priest), $2,300,000 (Mr. Boone) and $1,200,000 (Ms. Loeger).
Supplemental RSUs.Most of our new NEOs received a supplemental time-based RSU award that vests over two years, 50% on the first anniversary of the date of grant and 50% on the second anniversary of the date of grant, subject to continued employment. Ms. Loeger’s supplemental RSUs vest on a four-year schedule. Similar to new-hire cash payments, these supplemental RSU awards are designed to compensate for the delay in take-home pay that results from starting fresh in our long-term equity programs. In 2021, Mr. Priest, Mr. Boone and Ms. Loeger were granted supplemental RSUs in the following amounts: $3,000,000 (Mr. Priest), $1,500,000 (Mr. Boone) and $3,000,000 (Ms. Loeger).
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3. | 2021 Compensation Design and Determinations |
Our executive compensation program is highly performance-based, with payouts for elements under the performance-based program dependent on meeting financial and operational targets over one- and multi-yeardesignated performance periods. For 2016,2021, we selected financial metrics and targets that the Compensation and Human Capital Committee believes incentivize our management team to achieve our strategic objectives and drive the Company’s financial performance and long-term stock performance, including FX-neutral revenue, non-GAAP operating margin dollars, return on invested capital, payment intermediation usage and non-GAAP net income.
In 2016, we made great progress againstaddition to the core elements of our key strategic prioritiescompensation program discussed in this section, the Compensation Committee granted the one-time, transition awards to drive the best choice, the most relevance,NEOs who joined in 2021 and the most powerful selling platform. To drive the best choice for our consumers, we actively managed inventory, marketed around key retail moments, and launched integrations with partners to help enable small- and medium-sized merchants scale their businesses on eBay. We developed and began to roll out new consumer experiences to deliver a relevant shopping experience that is built on our structured data re-platforming effort. We also made a number2021, as discussed above in 2021 NEO Target Compensation – Target Value of platform improvements that are designed to build the most powerful selling platform, including launching our Seller Hub product, releasing a revamped set of seller APIs, and improving our listing flows.
The following charts show the Company’s 2016 financial results that impacted the Company’s executive compensation program.
2015-2016 Performance-Based Restricted Stock Unit (“PBRSU”) Program
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Compensation Discussion and Analysis |Executive Summary
2016 AnnualTarget Cash Incentive Award (the eBay Incentive Plan (eIP))
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We believe our compensation practices align with and support the goals of our executive compensation program and demonstrate our commitment to sound compensation and governance practices.
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Compensation Discussion and Analysis |Introduction
Introduction
This Compensation Discussion and Analysis is presented as follows:
This Compensation Discussion and Analysis describes the compensation of our “named executive officers” (“NEOs”)Salary for 2016:
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We conducted an extensive review of the Company’s compensation philosophy and executive compensation program for 2016 to assess whether they continued to be properly aligned with our business goals, culture and, importantly, stockholder interests. After conducting this review and considering the feedback received during the Company’s regular engagement with stockholders by management of the Company and members of the Board, we determined that the Company’s executive compensation philosophy, compensation objectives, and overall program continued to be appropriate. In addition, we decided to increase the weight of PBRSUs and eliminate stock options from the mix of equity for our executive officers.
In 2016, our stockholders once again overwhelmingly approved our executive compensation program through the “say on pay” vote, with 93% of the votes cast in favor. As a result, the Compensation Committee did not make any specific changes to the Company’s executive compensation program in response to the 2016 “say on pay” vote.
➊ Elements of Our Executive Compensation Program
The goals of our executive compensation program are to:
To achieve these goals, we have three principal components of our executive compensation program: equity compensation, an annual cash incentive, and base salary. We seek to ensure that total compensation for our executive officers is heavily weighted to variable, performance-based compensation by delivering a majority of compensation in the form of PBRSUs and annual cash incentives.
Compensation Discussion and Analysis |Elements of Our Executive Compensation Program
The Compensation Dashboard below provides a snapshot of the key elements of our 2016 executive compensation program and describes why each element is provided. Additional information about these key elements is included in the sections following the dashboard.
COMPENSATION DASHBOARDNEOs.
2021 Long-Term | ||||||||
Equity | ||||||||
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We chose a mix of equity and cash compensation vehicles to compensate executive officers based on long-term value drivers of Company performance over one- and multi-year periods and individual contributions to the Company. Our executive officers also were eligible to participate in our broad-based retirement savings (which include a 401(k) program open to all employees in the United States and an unmatched deferred compensation program available to vice presidents and above in the United States) and benefit programs and received limited perquisites.
Compensation Discussion and Analysis |Elements of Our Executive Compensation Program
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Beginning in 2016, we decided to increase the weight of PBRSUs and eliminate stock options from the mix of equity forIn 2021, our executive officers.
For 2016, once the valueNEOs received equity-related compensation as part of the Company’s standard annual equity incentive awards has been set for each executive officer,award. In general, the formula used to allocate the annual target equity awards is as follows:
Annual Equity Awards: Value
The value of annual equity awards is determined within guidelines that the Compensation Committee approves on an annual basis for each position. These guidelines are based on our desired pay positioning relative to companies with which we compete for talent. The midpoint of the guidelines, or the median target award, reflects the 50th percentile of the competitive market.
In 2016, the Compensation Committee approved equity award guidelines by position based on the following:
The Compensation Committee is also cognizant of dilution resulting from equity compensation, and so it carefully considers share usage each year and sets an upper limit on the number of shares that can be used for equity compensation, including awards to executive officers and the overall employee population.Time-based RSUs
Each executive officer’s individual contribution and impact, projected levelofficer receives a portion of contribution and impact inhis or her annual equity award as a grant of RSUs that vest on a quarterly basis over a four-year period subject to continued employment. For newly hired executive officers, 25% of the future, and competitive positioning are considered when determining individual awards. The retention valueinitial grant of current year awardsRSUs vest on the first anniversary of the date of grant and the total value of unvested equity from previous awards are also considered. The individual awards can be higher or lower thanremainder vest on a quarterly schedule. This vesting schedule is aligned with market practice and helps enable the median target award by an amount ranging from zeroCompany to three times the median target award. The Compensation Committee limits the use of special equity-related compensation for executive officers to extraordinary circumstances only. In 2016, none of our NEOs received equity-related compensation beyond the standard annual equity award.remain competitive in attracting talent.
PBRSU Program
Plan Design and Performance Periods.The PBRSU Program is a key component of the annual equity compensation for each executive officer. At the beginning of each performance period, executive officers receive PBRSU grants that are subject to performance- and time-based vesting requirements.
Compensation DiscussionPerformance Period and Analysis |Elements of Our Executive Compensation ProgramVesting
Each PBRSU cycle has a two-year performance period. The performance goals for each cycle are approved by the Compensation and Human Capital Committee at the beginning of the performance period. Each executive officer is awarded a target number of shares subject to the PBRSU award at the beginning of the performance period. PBRSU awards granted in 2021 are based on the 2021-2022 performance cycle.
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If the Company’s actual performance exceeds or falls short of the target performance goals, the actual number of shares subject to the PBRSU award will be increased or decreased formulaically.
Under the PBRSU program, under which PBRSUs are awarded to executives at the level of Senior Vice President and above, 100% of any PBRSU awards granted to ourthe CEO and CFO will vest, if at all, more than 14 months following the end of the applicable two-year performance period. This provision subjects 100% of the CEO and CFO PBRSU awards to a full three years of stock price volatility before the shares vest. For all executive officersSVPs other than the CEO and CFO, one-half of the PBRSUs vest in March following the end of the applicable performance period, and the other half of the award vests in March of the following year, more than one full year14 months following the completion of the performance period. The Compensation and Human Capital Committee believes that the post-performance periodpost-performance-period vesting feature of the PBRSUs provides an important mechanism that helps to retain executive officers and align their interests with long-term stockholder value.
The post-performance-period vesting feature subjects 100% of the CEO and CFO PBRSU awards to at least three years of stock price volatility before the shares vest. |
Performance Measures and Rationale.Rationale
As discussed above, the number of shares subject to a target PBRSU award are adjusted based on whether the Company’s actual performance exceeds or falls short of the target performance goals for the applicable performance period.
Compensation Discussion and Analysis |Elements of Our Executive Compensation Program
The following table outlines the performance measures for the 2015-20162020-2021 and 2016-20172021-2022 performance periods and the rationale for their selection:selection.
Performance Measures | ||
| FX-neutral revenue(1) — weighted 50% of award opportunity with a payout range of 0% to 200% of target (50% at threshold, 100% at target and 200% at maximum performance)
Non-GAAP operating margin dollars(2) — weighted 50% of award opportunity with a payout range of 0% to 200% of target (50% at threshold, 100% at target and 200% at maximum performance)
Return on invested capital (modifier) — can modify awards earned based on FX-neutral revenue and Non-GAAP operating margin up or down by as much as 20% | |
Rationale | The Compensation and Human Capital Committee believes these measures are key drivers of our long-term business success and stockholder value, and are directly affected by the decisions of the Company’s management.
Both FX-neutral revenue and non-GAAP operating margin dollars measures are used to help ensure that leaders are accountable for driving profitable growth, and making appropriate tradeoffs between investments that increase operating expense and future growth in revenue.
The return on invested capital modifier is used to hold leaders accountable for the efficient use of capital. | |
Targets | The two-year performance targets are generally set in a manner consistent with the current year budget and multi-year strategic plan.
At the time the performance targets were set, the target goals were designed to be achievable with strong management performance, while the maximum goals were designed to be very difficult to achieve. |
(1) | Calculated on a fixed foreign exchange |
(2) | Non-GAAP operating margin dollars excludes certain items, primarily stock-based compensation expense and related employer payroll taxes, amortization of acquired intangible assets, impairment of goodwill, separation expenses, and certain one-time gains, losses and/or expenses. |
56 Planebay / 2022 Proxy Statement
Calculation Mechanics and Targets. The two-year performance targets are generally set in a manner consistent with the current year budget and multi-year strategic plan.
To receive any shares subject to a PBRSU award, at least one of the FX-neutral revenue or non-GAAP operating margin dollars minimum performance thresholds must be met. Each of the minimum performance thresholds are independent and, if any of the FX-neutral revenue or non-GAAP operating margin dollar performance thresholds are met, the award is adjusted with respect to that performance measure in accordance with the percentages outlined in the illustration below.above. If the minimum performance threshold for either FX-neutral revenue or non-GAAP operating margin dollars is not met, then no shares are awarded for that performance measure. At the time the performance targets were set, the target goals were designed to be achievable with strong management performance, while the maximum goals were designed to be very difficult to achieve.
The following chart shows the minimum, target, and maximum payout percentage for FX-neutral revenue and non-GAAP operating margin dollars:
Minimum | Target | Maximum | |||||||||||||
FX-neutral revenue | 25 | % | 50 | % | 100 | % | |||||||||
Non-GAAP operating margin dollars | 25 | % | 50 | % | 100 | % |
The number of shares awarded is determined by comparing our actual performance for FX-neutral revenue and non-GAAP operating margin dollars over the performance period against the minimum, target, and maximum performance levels and converting the result into a payout percentage. The FX-neutral revenue and non-GAAP operating margin dollars measures are then added together and this total is multiplied by the third measure, return on invested capital, with the modification multiplier determined in accordance with the table below:
Minimum | Target | Maximum | |||||||||||||
Return on invested capital (modifier) | 80 | % | 100 | % | 120 | % |
The target award is multiplied by the percentage resulting from this calculation to determine the actual number of PBRSUs awarded. The Compensation and Human Capital Committee may approve adjustments to the calculations of the performance measures due to material events not contemplated at the time the targets were set (such as major acquisitions)acquisitions or unusual or extraordinary corporate transactions, events, or developments) and the Compensation and Human Capital Committee may apply negative discretion to reduce the
Compensation Discussion and Analysis |Elements of Our Executive Compensation Program
payout levels of the awards. Shares that vest under PBRSU awards are
The 2020-2021 and 2021-2022 PBRSUs can be earned out in range of 0% to 240% of the initial grant, based on eBay’s FX-neutral revenue, non-GAAP operating margin dollars, and return on invested capital for the two-year performance period.target grant.
Time-based RSUs
As discussed above, each executive officer receives a portion of his or her equity award as a grant of RSUs that vest over a four-year period subject to continued employment. Beginning with awards granted on or after February 15, 2016, we moved from annual vesting over four years to quarterly vesting over four years. For newly hired executive officers, 25% of the initial grant of time-based RSUs vest on the first anniversary of the date of grant and the remainder vest on the quarterly schedule. This change is aligned with the current market practices of many companies in our peer group and will help enable the Company to remain competitive in attracting talent.
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2020-2021 PBRSU Cycle Performance and Shares Earned
As discussed in the Executive Summary above, the Company’s financial performance during the 2020-2021 performance cycle was extraordinary. The following graphic illustrates the payout calculation for the 2020-2021 PBRUSs based on performance above maximum for both the Revenue and Operating Margin measures, and upward modification from the Return on Invested Capital modifier:
For the 2020-2021 performance period, actual awards under the PBRSU Program could range from 0% to 240% of the target awards. Based on the Company’s extraordinary financial performance during the 2020-2021 performance period, the PBRSU payout percentage was 240% of target and our NEOs received the following awards:
Name | Percentage of Target | Target Shares | Shares Awarded for 2020-2021 Performance Cycle | Vesting Schedule | ||||
Mr. Iannone | 240% | 182,196 | 437,270 | 100% on March 15, 2023 | ||||
Mr. Priest* | N/A | N/A | N/A | N/A | ||||
Mr. Boone* | N/A | N/A | N/A | N/A | ||||
Mr. Thompson | 240% | 85,740 | 205,776 | 50% on March 15, 2022; 50% on March 15, 2023 | ||||
Ms. Loeger* | N/A | N/A | N/A | N/A |
* | Due to their hire dates, Mr. Priest, Mr. Boone and Ms. Loeger did not receive a grant for the 2020-2021 PBRSU cycle. |
In accordance with the terms of Ms. Yetto’s offer letter agreement, her 2020-2021 PBRSU award was deemed earned prior to her separation date assuming achievement of target performance, and such shares were paid to her in a cash lump sum using certain value assumptions. Mr. Cring is not eligible for our PBRSU program due to his position as VP.
Please see discussion below under Severance and Change in Control Arrangements with Executive Officers and Clawbacks.
58 ebay / 2022 Proxy Statement
2021 Annual Cash Incentive Awards (eIP)
Plan Design and Performance Period.
The eBay Incentive Plan (“eIP”)eIP is a broad-based short-term cash incentive plan. The Compensation and Human Capital Committee has set an annual performance period under the plan.
The plan is designed to support a tight link between
In the first quarter of the year, the Compensation and Human Capital Committee approves Company performance measures based on business criteria and any incentive payouts. The annual cash incentives payable for 2016 had both a FX-neutral revenue thresholdtarget levels of performance. After the end of each year, the Compensation and a non-GAAP net income minimumHuman Capital Committee approves the actual performance threshold. Unless both of these minimum performance thresholds are met, there is no incentive payout. If both minimum performance thresholds are met,against the Company uses total non-GAAP net incomefinancial performance measures to determine the payout percentage of the Company financial performance componentfor that portion of the annual cash incentive.
Additionally, if the minimum performance thresholds are met, 75% of executive officers’ payouts under the plan are based on the Company’s performance as described above. To facilitate differentiation based on individual performance, the remaining 25% of awards are based on individual performance. As discussed in more detail below, the Compensation Committee considers many factors in determining the CEO’s individual performance, but does not assign specific weighting to these factors. The CEO partners with the Compensation Committee to similarly assess the individual performance of the other executive officers. In circumstances where the Company’s financial performance is above its minimum performance threshold but below the target performance threshold, a modifier is applied to the individual performance component to reduce it proportionately based on the Company financial performance component. For example, if the Company exceeded the FX-neutral revenue minimum performance threshold but total non-GAAP net income was 90% of the target performance threshold, then the individual performance component would be calculated as follows: target incentive amount x 25% x individual performance score x 90%. The maximum payout for both the Company financial performance and the individual performance components of the annual incentive plan is 200% of target.
Compensation Discussion and Analysis |Elements of Our Executive Compensation Programplan.
Performance Measures and Rationale.Rationale
The following table provides information on the Company performance measures set in 20162021 and rationale for their selection:
Performance Measures(1) | Rationale | Target | ||
Company financial performance measure | ||||
FX-neutral revenue (threshold) | The Compensation and Human Capital Committee believes that a minimum revenue threshold should be met before any cash incentive is paid. Once the minimum revenue threshold has been met, the Company financial performance component of the annual cash incentive payment is paid based on results in relation to the | Targets are set based primarily on the Company’s Board-approved budget for the year. | ||
Non-GAAP | Non-GAAP net income is the key measure of short- and intermediate-term results for the Company given that it can be directly affected by the decisions of the Company’s management and provides the most widely followed measure of financial performance. | Targets are set based primarily on the Company’s Board-approved budget for the year. | ||
Individual measure | ||||
Individual performance | The Compensation and Human Capital Committee believes that a portion of the compensation payable under this plan should be differentiated based on individual performance for which a review is conducted at the end of the year. | • CEO’s assessment of the individual performance of the executive officers who are his direct reports while assessment of the CEO’s performance is made by the Compensation and Human Capital Committee. •In making its determination of the individual performance of each executive officer, the Compensation and Human Capital Committee does not give any specific weighting to individual goals. •A modifier to individual performance is applied based on achievement of Company performance goals, regardless of individual goal achievement. NEW The Company modifier will adjust the individual payout based on Company performance between a range of 80%-120%. For example, if the Company exceeded the FX-neutral revenue minimum performance threshold and total non-GAAP net income was 90% of the target performance threshold, then the individual performance component would be reduced by 10%. The base range of payouts for the individual performance component of the annual incentive plan is 0% to 200% of target, with potential upward modification of 20% when Company financial performance is at maximum. |
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(1) | Both minimum FX-neutral revenue and minimum non-GAAP net income performance thresholds must be met in order for there to be any incentive payout based on Company performance or individual performance, with the payout level for Company financial performance component based on the amount of non-GAAP net income. |
(2) | Non-GAAP net income excludes certain items, primarily stock-based compensation expense and related employer payroll taxes, amortization or impairment of acquired intangible assets, impairment of goodwill, amortization of the deferred tax asset associated with the realignment of |
Plan
Calculation Mechanics and Targets. In the first quarter of the year, the Compensation Committee approves
The plan is designed to support a tight link between Company performance measures based on business criteria and target levels of performance. Targets are set based primarily on the Company’s Board-approved budget for the year.
any incentive payouts. The Compensation Committee also assesses annual cash incentives payable for 2021 had both a FX-neutral revenue threshold and a non-GAAP net income minimum performance threshold. Unless both of these minimum performance thresholds are met, there is no incentive award opportunities against data from public filings of our peer group companies and general industry data for comparable technology companies thatpayout. If both minimum performance thresholds are included in proprietary third-party surveys, and it approves target annual cash incentive opportunities for our NEOs at approximately the 50th percentile based on that data. We review market data annually, but only periodically adjust incentive opportunities.
After the end of each year, the Compensation Committee approves the actual performance againstmet, the Company financial performance measuresuses total non-GAAP net income to determine the payout percentage for that portionof the Company financial performance component of the annual cash incentive plan. (from 50% at threshold to 200% for maximum performance). When the minimum performance thresholds are met, 75% of executive officers’ payouts under the plan are based on the Company’s performance as described above and, to facilitate differentiation based on individual performance, the remaining 25% of awards are generally based on individual performance.
As discussed in more detail below, the Compensation and Human Capital Committee considers many factors in determining the CEO’s individual performance, but does not assign specific weighting to these factors. The CEO partners with the Compensation and Human Capital Committee to similarly assess the individual performance of the other executive officers. Consistent with our commitment to aligning executive compensation with Company performance, the Company modifier will adjust the individual payout based on Company performance between a range of 80%-120%. For example, if the Company exceeded the FX-neutral revenue minimum performance threshold and total non-GAAP net income was 90% of the target performance threshold, then the individual performance component would be reduced by 10%. The base range of payouts for the individual performance component of the annual incentive plan is 0% to 200% of target, with potential upward modification of 20% when Company financial performance is at maximum.
Individual Performance
With respect to individual performance, our CEO presents the Compensation and Human Capital Committee with his assessment of the individual performance of the executive officers who are his direct reports and recommends a bonus payout percentage for the individual performance component of the annual incentive plan based on his assessment. The Compensation and Human Capital Committee reviews his assessments and payout recommendations, along with the score card evaluation and makes a subjective determination of the level of individual performance and payouts for each of those executive officers. In addition, the Compensation and Human Capital Committee (with input from the ChairmanChair of the Board and other independent members of the Board) makes a subjective determination of the individual performance of the CEO. In making its determination of the individual performance of each executive officer, the Compensation and Human Capital Committee does not give any specific weighting to individual goals.
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Assessment For 2021, the executive team set team goals related to our sustainability and Target Positioning Strategy. We review market dataDE&I initiatives, and approve each executive officer’s base salary forsuccess against these goals was a factor considered in the year. Increases generally become effective on or around April 1stcommittee’s subjective assessment of individual performance. In addition, as described above, when the year. We assess competitive market data on base salaries from public filingsCompany fails to achieve target performance, a downward modifier is applied to individual performance regardless of our peer group companies and general industry data for comparable technology companies that are includedindividual goal achievement in proprietary third-party surveys. When considering the competitive market data, we also recognize that the data is historical and does not necessarily reflect those companies’ current pay practices. We assess each executive officer’s base salary
Compensation Discussion and Analysis |Compensation Decisions for 2016order to take a more holistic approach to assessing performance.
against2021 Performance and Payouts
We discuss the 50th percentile of the salaries paid to comparable executives at peer group companies and also consider individual performance, levels of responsibility, expertise, and prior experience in our evaluation of base salary adjustments.
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We provide certain executive officers with limited perquisites and other personal benefits not available to all employees that we believe are reasonable and consistent with our overall compensation program and philosophy. These benefits are provided to enable the Company to attract and retain these executive officers. We periodically review the levels of these benefits provided to our executive officers.
Mr. Wenig and Mr. Schenkel have access to the corporate airplane for up to 50 hours and 20 hours of personal use, respectively, subject to Mr. Wenig and Mr. Schenkel fully reimbursing the Company for the incremental costs associated with such use. The Company does not grant bonuses to cover, reimburse, or otherwise “gross-up” any income tax owed for personal travel on the corporate airplane.
➋ Compensation Decisions for 2016
When making compensation decisions for our NEOs, the Compensation Committee evaluated each individual based on his or her leadership, competencies, innovation, and both past and expected future contributions toward the Company’s financial strategic, and other priorities. Under the leadership of Mr. Wenig, the Company made solid progress during the year against its long-term strategic plan as it began to deliver on its commitment to drive the best choice, the most relevance, and the most powerful selling platform. At the same time, Mr. Wenig and his leadership team focused on building a values-based culture that is inventive, bold, courageous, diverse and inclusive.
In addition, the Compensation Committee considered retention concerns as well as the total value of each NEO’s unvested equity awards. Based on its assessment, the Compensation Committee approved individual compensation arrangements for each NEO based on the factors and guidelines described above and in this section.
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The Compensation Committee takes a multi-year view of Mr. Wenig’s total compensation, with the objective of rewarding his leadership of the Company and tying his compensation to Company results and stock price performance. In doing so, the Compensation Committee has sought to focus Mr. Wenig’s attention on the longer-term performance of the Company.
The Compensation Committee considered many factors in setting the various components of Mr. Wenig’s compensation, including the factors set forth below. In evaluating performance against these factors, the Compensation Committee assigned no specific weighting to these factors and it evaluated individual performance in a holistic manner.
Compensation Discussion and Analysis |Compensation Decisions for 2016
The Compensation Committee also reviewed and approved the salary, target annual cash incentive award, and target value of equity awards for our CEO considering available market data as well as Company and individual performance.
The Compensation Committee determined that Mr. Wenig’s base salary and target annual cash incentive award remained competitive without an increase and that his overall cash compensation was consistent with creating an ownership culture by focusing his compensation mix on equity rather than cash.
In determining Mr. Wenig’s 2016 equity award, the Compensation Committee recognized the strength of Mr. Wenig’s leadership team, his focus on shaping eBay’s culture to embrace innovation, risk-taking and diversity in the workforce and the marketplace, the over-delivery of financial results against targets, the execution against the long-term strategic plan to drive future growth, and engagement with current and potential investors. They also considered the year-over-year increase in the value of equity grants awarded in the prior year to CEOs of other large, public companies in the Internet and technology space.
The following table outlines Mr. Wenig’s 2016 compensation:
2016 | 2015 | Year-Over-Year Change ($) | Year-Over-Year Change (%) | |||||||||||||||||
Base Salary | $ | 1,000,000 | $ | 1,000,000 | No change | No change | ||||||||||||||
Target Annual Cash Incentive Award (percentage of base salary) |
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200% |
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200% |
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No change |
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No change |
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Target Value of Equity Awards | $ | 12,500,000 | * | $ | 11,000,000 | $ | 1,500,000 | * | 14% |
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The following chart shows the breakdown of reported 2016 compensation for Mr. Wenig. This chart illustrates the predominance of equity incentives and performance-based components in our executive compensation program.
DEVIN WENIG
Compensation Discussion and Analysis |Compensation Decisions for 2016
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The Compensation Committee considered many factors in approving the various components of the other NEOs’ compensation, including the factors set forth below. In evaluating performance against these factors, the Compensation Committee assigned no specific weighting to these factors and it evaluated individual performance in a holistic manner.
The Compensation Committee reviewed and approved the target value of equity awards, target annual cash incentive award, and salary for our NEOs based on available market data as well as Company and individual performance.
The Compensation Committee determined that the target annual cash incentive award and base salary for our other NEOs remained competitive without an increase and that their overall cash compensation was consistent with creating an ownership culture by focusing the compensation mix on equity rather than cash. The Committee determined equity awards based on delivery against business metrics, financial targets and Company-level leadership. The decreases in the total target value of 2016 equity awards compared to 2015 equity awards for Mr. Schenkel and Mr. Lawton reflect the fact that each received equity awards in 2015 that recognized either a new position in the Company or a new hire grant.
The following chart shows the compensation arrangements for our other NEOs:
NAME | 2016 Base Salary | Year-Over-Year Change for Base | 2016 Target Annual Cash Incentive Award | Year-Over- Year Change for Target Annual Cash Award ($) | 2016 Target Value of Equity Awards* | Year-Over- Year Change | ||||||||||||||||||
Scott Schenkel | $ | 650,000 | No Change | 100 | % | No Change | $ | 6,000,000 | ** | ($ | 2,000,000 | ) | ||||||||||||
Stephen Fisher | $ | 625,000 | No Change | 75 | % | No Change | $ | 7,000,000 | *** | $ | 3,500,000 | **** | ||||||||||||
Harry Lawton | $ | 650,000 | No Change | 75 | % | No Change | $ | 3,500,000 | *** | ($ | 2,500,000 | ) | ||||||||||||
Raymond Pittman | $ | 580,000 | n/a | 75 | % | n/a | $ | 5,500,000 | *** | n/a |
** For the PBRSU portion of the award, if performance targets are met, 100% of achieved portion of the award will vest on March 15, 2019.
*** For the PBRSU portion of the award, if performance targets are met, 50% of the achieved portion of the award will vest on March 15, 2018 and the remaining 50% of achieved portion of the award will vest on March 15, 2019.
**** Mr. Fisher had recently joined the Company at the time of his 2015 grant. As a result, Mr. Fisher’s 2015 grant was lower than typical due to the timing of this grant and his hire date. The target value of Mr. Fisher’s equity awards for 2016 reflects a full year of employment.
Compensation Discussion and Analysis |2016 Business Results
The following is a summary of the business results that directly affected 2016 executive compensation, including performance-based equity awards and annual cash incentive awards.
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2015-2016 PBRSU Award
The following graphs show the goals and results achieved for the 2015-2016 performance period:
The performance goals for the 2015-20162021 eIP performance period and corresponding performance results above in the Executive Summary. The financial performance goals were set in early 2015, before the impact of the completion of the Spin-Off of PayPal and the sale of eBay Enterprise were known. In early 2016, the Committee modified the performance goals for the 2015 component of the 2015-2016 performance period because the Committee determined that it was appropriate to adjust the performance goals to reflect the impact of the eBay Enterprise sale. The Committee also modified the non-GAAP operating margin performance goal, which was partially2021 based primarily on the Company’s pre-Spin-Off hedging strategybudget for the combined entity, to account for foreign-exchange rate impact and certain costs related to the Spin-Off of PayPal.
The targets for the 2015-2016 performance period were lower than the Company’s actual results for the 2014-2015 performance period. This is because the actual results for the 2014-2015 performance period included the performance of eBay, PayPal, and Enterprise for 2014, whereas the 2015-2016 targets were based solely on the performance of eBay.
Following the end of the performance period,year. In early 2022, as part of its review of the Company’s financial performance against the PBRSUannual cash incentive plan targets and in accordance with its authority under the cash incentive plan, the Compensation and Human Capital Committee considered whether the impact of any significant corporate events not contemplated at the time the targets were set should lead to an adjustment of any of the performance result. The Committee determined that it wasresults and made appropriate to adjust the calculation of return on invested capitaladjustments for 2016 to remove the impact of a non-cash deferred tax asset related to a legal structure realignment.
Compensation Discussion and Analysis |2016 Business Results
Actual awards under the PBRSU plan could range from 0% to 240% of the target awards.two significant divestitures. Based on the Company’s financialabove-threshold performance during the 2015-2016 performance period, the actual PBRSU awards were 126% of target and our NEOs received the following awards:
Name | Percentage of Target | Size of Award for 2015-2016 Performance Cycle | Vesting Schedule | |||||||||
Devin Wenig | 126 | % | 282,494 | 100% on March 1, 2018 | ||||||||
Scott Schenkel | 126 | % | 196,426 | 100% on March 1, 2018 | ||||||||
Stephen Fisher | 126 | % | 91,711 | 50% on March 1, 2017; 50% on March 1, 2018 | ||||||||
Harry Lawton | 126 | % | 75,740 | 50% on March 1, 2017; 50% on March 1, 2018 | ||||||||
Raymond Pittman | 126 | % | 65,508 | 50% on March 1, 2017; 50% on March 1, 2018 |
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2016 Annual Cash Incentive Goals and Plan Performance.
The following graphs show the goals and results achieved for the 2016 performance period:
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The performance goals for the 2016 performance period were set in early 2016 based primarily on the Company’s budget for the year. The performance goal for FX-neutral revenue isand above-maximum performance for Non-GAAP net income, the Company financial performance component was certified by the Compensation and Human Capital Committee at 200% of target for all NEOs. This performance result also resulted in a minimum revenue threshold that must be met for120% upward modification of individual performance component.
The Compensation and Human Capital Committee considered the factors listed above when assessing Mr. Iannone’s individual performance. Mr. Iannone’s individual component of the annual cash incentive payment to be paid based on actual results in relation to the Non-GAAP net income performance goals. The target for Non-GAAP net income for 2016 was lower than the actual results for Non-GAAP net income in 2015 because the 2016 target reflected the anticipated foreign-exchange rate impact of a stronger U.S. dollar and certain Spin-Off related costs.
In early 2017, as part of its review of the Company’s financial performance against the annual cash incentive plan targets and in accordance with its authority under the plan, the Compensation Committee considered whether the impact of any significant corporate events not contemplated at the time the targets were set should lead to an adjustment of any of the performance results. The Compensation Committee determined that it was appropriate to adjust non-GAAP net income to remove the impact of incremental interest expense from the Company’s 2016 offering of institutional and retail bonds and to eliminate the gain realized from de-designation of certain foreign exchange hedges related to the realignment of our legal structure in 2016.
In addition, the Compensation Committee reviewed Mr. Wenig’s performance for the purpose of determining the individual portion of his 2016 annual cash incentive award, with input from the entire Board. The Compensation Committee did not assign fixed weightings to specific individual goals or performance criteria. Instead, it took a holistic view of performance during the year and the Company’s positioning for the future. The Compensation Committee considered the strong financial results in 2016 and the solid positioning of the core eBay business, StubHub and Classifieds. As a result, the individual performance component of Mr. Wenig’s annual cash incentive award was established at 150%175% of target and his(which was modified upward by 120%). Mr. Iannone’s total earned annual incentive award for 20162021, including the Company financial component and the individual component, was 121.5%203% of target.
For the other NEOs, the individual performance component was recommended by Mr. Iannone based on his assessment of each executive’s performance using the score card factors described above, which the Compensation Discussion and Analysis |Human Capital Committee reviewed and approved in light of management’s strong performance in 2021 (as discussed above in the Executive Summary). The earned annual incentive award for each of our NEOs for 2021 was as follows:
Name | Annual Cash Incentive Target as Percentage of Base Salary | Annual Cash Incentive Award for 2021 | Company Performance Payout % | Performance Payout as % of Target | |||||
Mr. Iannone | 200% | $ | 4,050,000 | 200% | 203% | ||||
Mr. Priest | 100% | $ | 817,789 | (1) | 200% | 210% | |||
Mr. Boone | 65% | $ | 767,349 | (1) | 200% | 203% | |||
Ms. Loeger | 75% | $ | 984,375 | 200% | 210% | ||||
Mr. Thompson | 75% | $ | 907,031 | 200% | 188% |
(1) | Cash incentive was prorated based on time employed by the Company during 2021. |
In accordance with Mr. Cring’s interim CFO letter agreement, Mr. Cring received a monthly performance bonus that is based on the difference of his annual target cash opportunity and the CFO position. These amounts are captured in the 2021 discretionary “Bonus” column of the Summary Compensation Table. In accordance with our severance arrangement, Mr. Cring’s eIP payout was based on the actual performance of the Company for the full year and target individual performance, but prorated for the time that he was employed during 2021. Please see discussion below under Severance and Change Inin Control Arrangements with Executive Officers and ClawbacksClawbacks.
TheIn accordance with Ms. Yetto’s offer letter agreement, her eIP payout level under the annual cash incentive plan could range from 0%-200% of target. The Company performance component (75%) of the annual cash incentive plan was based on the Company’s non-GAAP net income for 2016 (and the achievementactual performance of the FX-neutral revenue threshold) and paid at 112% of target. TheCompany for the full year (not accounting for any individual performance component (25%)factors), prorated for the time that she was based on each NEO’s individual performance score and the total earned annual incentive award for 2016 for each of our NEOs were paid at between 105.3% and 121.5% of target as follows:
Name | Annual Cash Incentive Target as Percentage of Base Salary | Annual cash Incentive Award for 2016 | ||||||||
Devin Wenig | 200 | % | $ | 2,430,000 | ||||||
Scott Schenkel | 100 | % | $ | 789,750 | ||||||
Stephen Fisher | 75 | % | $ | 493,359 | ||||||
Harry Lawton | 75 | % | $ | 513,094 | ||||||
Raymond Pittman | 75 | % | $ | 457,837 |
➍employed during 2021. Please see discussion below under Severance and Change Inin Control Arrangements with Executive Officers and ClawbacksClawbacks.
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4. | Further Considerations for Setting Executive Compensation |
Role of Consultants in Compensation Decisions
Pay Governance LLC (“Pay Governance”) serves as the Compensation and Human Capital Committee’s independent compensation consultant. It provides the Compensation and Human Capital Committee with advice and resources to help the Compensation and Human Capital Committee assess the effectiveness of the Company’s executive compensation strategy and programs. Pay Governance reports directly to the Compensation and Human Capital Committee, and the Compensation and Human Capital Committee has the sole power to terminate or replace Pay Governance at any time.
As part of its engagement, the Compensation and Human Capital Committee has directed Pay Governance to work with our Senior Vice President, Chief People Officer and other members of management to obtain information necessary for Pay Governance to form recommendations and evaluate management’s recommendations to the Compensation and Human Capital Committee. Pay Governance also meets with the Compensation and Human Capital Committee during its regular meetings, in executive session (where no members of management are present), and with the Compensation and Human Capital Committee chair and other members of the Compensation and Human Capital Committee outside of the Compensation and Human Capital Committee’s regular meetings. As part of its engagement in 2021, Pay Governance provided a market overview of executive compensation, evaluated the Company’s peer group composition, evaluated compensation levels at the peer group companies, assessed and proposed equity and cash compensation guidelines for various executive job levels, assessed compensation for the Company’s executive officers, advised on the framework for the Company’s longterm incentive awards, and assessed Board compensation. Pay Governance also provided guidance to the Compensation and Human Capital Committee with respect to the leadership transition. Pay Governance does not provide any other services to the Company.
Compensation Consultant Conflict of Interest Assessment
The Compensation and Human Capital Committee recognizes that it is essential to receive objective advice from its compensation advisors. To that end, the Compensation and Human Capital Committee closely examines the procedures and safeguards that its compensation advisor takes to ensure that its services are objective. The Compensation and Human Capital Committee has assessed the independence of Pay Governance pursuant to SEC rules and concluded that Pay Governance’s work for the Compensation and Human Capital Committee does not raise any conflict of interest.
Risk Assessment of Compensation Policies and Practices
We have assessed the compensation policies and practices for our employees and concluded that they do not create risks that are reasonably likely to have a material adverse effect on the Company. This analysis was presented to the Compensation and Human Capital Committee, which agreed with this conclusion.
Peer Group Considerations
To set total compensation guidelines, we review market data of companies that are comparable to eBay and that we believe compete with eBay for executive talent, business, and capital. We review both specific data from peer group companies’ public filings and general industry data for comparable technology companies that are included in proprietary third party surveys. We believe that it is necessary to consider this market data in making compensation decisions to attract and retain talent. We also recognize that, at the executive level, we compete for talent against larger global companies, as well as smaller, non-public companies.
To assess whether the peer group continues to reflect the markets in which we compete for executive talent, the Compensation and Human Capital Committee reviews and approves the peer group each year with the assistance of its compensation consultant. In deciding whether a company should be included in the peer group, the Compensation and Human Capital Committee generally considers the following screening criteria:
62 ebay / 2022 Proxy Statement
For each member of the peer group, one or more of the factors listed above was relevant to the reason for inclusion in the group, and, similarly, one or more of these factors may not have been relevant to the reason for inclusion in the group.
The Compensation and Human Capital Committee evaluates the Company’s peer group on an annual basis. The peer group consisted of the following companies for 2021:
Our
Adobe Inc. | Etsy, Inc. | Netflix, Inc. | ||
Alphabet Inc. | Expedia Group, Inc. | PayPal Holdings, Inc. | ||
Amazon.com, Inc. | Meta Platforms, Inc. | salesforce.com, Inc. | ||
Booking Holdings Inc. | Intel Corporation | Symantec Corporation | ||
Cisco Systems, Inc. | Intuit Inc. | Twitter, Inc. | ||
Electronic Arts Inc. | Microsoft Corporation | Walmart Inc. |
For 2022, the Compensation and Human Capital Committee added Airbnb, Inc. and Square, Inc. due to both companies becoming talent competitors.
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5. | Severance and Change in Control Arrangements with Executive Officers and Clawbacks |
The objective in creating theof our severance and change in control arrangements described below wasis to provide fair and reasonable severance that wouldwill also serve as a retention incentive for those impacted by a change in control or similar transactions. We believe that these protections help the Company attract and retain highly talented executive officers.
In advance of the Spin-Off of PayPal
Severance Arrangements Outside a Change in 2015, we adopted the eBay Inc.Control
The Company’s SVP and Above Standard Severance Plan and Summary Plan Description (the “Standard(“Standard Severance Plan”) and the eBay Inc. Change, which covers officers employed as a senior vice president or in Control Severance Plan for Key Employees and Summary Plan Description (the “Change in Control Severance Plan”). In considering the protections included in these plans, we conducted a comprehensive review of protections provided tomore senior executives of our peer group and took into account the information about candidates’ expectations learned in the course of recruiting efforts in 2015 for talented senior leaders to complete our leadership team. When considering whether to enter into arrangements outside these plans, the Compensation Committee was also mindful that newly recruited executives were either leaving relatively secure employment arrangements or turning down attractive alternative offers and determined that these protections should be extended to certain, then-current executives in order to maintain internal alignment.
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The Company’s Standard Severance Planposition, provides severance protection outside of a change in control period if a participant is terminated without cause and signs and does not revoke a waiver of claims against the Company. Mr. FisherMessrs. Iannone, Priest, Boone and Mr. PittmanThompson and Ms. Loeger participate in the Standard Severance Plan. For Mr. Iannone, the Standard Severance Plan also covers his resignation for good reason and provides enhanced benefits for the role of CEO. Further, in the event of a qualifying termination of Mr. Iannone under the Standard Severance Plan within two years of his hire date, his offer letter agreement provides for acceleration of certain of his new-hire equity awards above the normal acceleration provisions of the Standard Severance Plan.
Mr. Wenig, Thompson will separate from the Company at the end of April 2022 and will be paid severance pursuant to the Standard Severance Plan. Details of his severance benefits are provided in Executive Compensation Tables—Potential Payments Upon Termination or Change in Control below.
Mr. SchenkelCring participated in the Company’s VP Standard Severance Plan (“VP Severance Plan”), which also provides severance protection outside of a change in control period. In May 2020, the Compensation and Human Capital Committee approved enhanced severance protections for Mr. Lawton doCring in recognition of his responsibilities as the Interim CFO. Mr. Cring separated from the Company in October 2021, and was paid severance pursuant to his arrangement. Details of Mr. Cring’s severance package are provided in the footnotes to the Executive Compensation Tables – Summary Compensation Table below.
Ms. Yetto did not participate in the Standard Severance Plan. Mr. Wenig and Mr. SchenkelShe entered into an offer lettersletter agreement with the Company in 2014 in connection with theirher appointment to their current roles at the Company, whichleadership team around the time of the Company’s separation of PayPal Holdings, Inc (in 2015). The offer letter provided for certain severance arrangements if they are respectively terminatedbenefits for a termination without cause or resignresignation for good reason not in connection with a change in control, and signif she signed and dodid not revoke a waiver of claims against the Company. Mr. Lawton, whoMs. Yetto separated from the Company in February 2021, and was hired a few months before the Spin-Offpaid severance pursuant to her offer letter agreement. Details of PayPal, does not participateMs. Yetto’s severance package are provided in the Standard footnotes to the Executive Compensation Tables – Summary Compensation Table below.
Severance Plan because his offer letter provided severance arrangements if he is terminated without cause or resigns for good reason notArrangements in connectionConnection with a changeChange in control, and he signs and does not revoke a waiver of claims against the Company.Control
Compensation Discussion and Analysis |Severance and Change In Control Arrangements with Executive Officers and Clawbacks
The following chart describes the severance benefits that each of our NEOs would receive if terminated outside of a change in control.
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The Company has not entered into any arrangements with any of its executive officers to provide “single trigger” severance payments upon a change in control.
The Company’s equity incentive plans generally provide for the acceleration of vesting of awards granted under the plans upon a change in control only if the acquiring entity does not agree to assume or continue the awards. These provisions generally apply to all holders of awards under the equity incentive plans.
The Company’s Change in Control Severance Plan provides severance protection for executives at the level of VP or in a more senior position in connection with a change in control if a participant is terminated without cause or resigns for good reason and signs and does not revoke a waiver of claims against the Company. Messrs. Iannone, Priest, Boone and Thompson and Ms. Loeger participate, and prior to his termination Mr. Fisher and Mr. Pittman participateCring participated, in the Change in Control Severance Plan. Mr. Thompson will no longer participate in in the Change in Control Severance Plan upon his departure.
Mr. Wenig, Mr. Schenkel, and Mr. Lawton do
64 ebay / 2022 Proxy Statement
Ms. Yetto did not participate in the Change in Control Severance Plan. Mr. Wenig and Mr. Schenkel entered intoHer offer letters with the Company in 2014 in connection with their appointment to their current roles at the Company, whichletter agreement provided for change in control arrangementscertain severance benefits if they are respectivelyshe was terminated without cause or resignresigned for good reason in connection with a change in
Compensation Discussion and Analysis |Severance and Change In Control Arrangements with Executive Officers and Clawbacks
control, and sign and do not revoke a waiver of claims against the Company. Mr. Lawton, who was hired a fewninety days preceding or the twenty-four months before the Spin-Off of PayPal, does not participate in the Change in Control Severance Plan because his offer letter provided change in control arrangements if he is terminated without cause or resigns for good reason in connection withfollowing, a change in control, and signssigned and doesdid not revoke a waiver of claims against the Company.
The following chart describes
Please see Executive Compensation Tables—Potential Payments Upon Termination or Change in Control for further information regarding the severanceStandard Severance Plan, Mr. Cring’s benefits that eachunder the VP Severance Plan, the Change in Control Severance Plan and the relevant provisions of our NEOs would receive if they are terminated in connectionthe offer letter agreement with a change in control.Ms. Yetto.
Clawbacks
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The Compensation and Human Capital Committee has adopted a clawback policy that covers each officer employed as a vice presidentVice President or in a more senior position and applies to incentive compensation, which includes any cash incentive award, equity award, or equity-based award paid or awarded to any covered employee during the period in which he or she is designated as a covered employee. For all covered employees, the occurrence of either of the following events is covered: (a) an action or omission by the covered employee that constitutes a material violation of the Company’s Code of Business Conduct or (b) an action or omission by the covered employee that results in material financial or reputational harm to the Company. In addition, for covered employees that are employed as a senior vice presidentSenior Vice President or in a more senior position or a vice presidentVice President who is a member of the finance function, the following event is also covered: a material restatement of all or a portion of the Company’s financial statements that is the result of a supervisory or other failure by the covered employee.
Compensation Discussion and Analysis |Further Considerations for Setting Executive Compensation
Under the clawback policy, the Compensation and Human Capital Committee has the authority and discretion to determine whether an event covered by the policy has occurred and, depending on the facts and circumstances, may (but need not) require the full or partial forfeiture and/or repayment of any incentive compensation covered by the policy that was paid or awarded to a covered employee. The forfeiture and/or repayment may include all or any portion of the following:
➎ Further Considerations for Setting Executive Compensation
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Pay Governance serves as the
Compensation Committee’s independent compensation consultant. It provides the Compensationand Human Capital Committee with advice and resources to help the Compensation Committee assess the effectiveness of the Company’s executive compensation strategy and programs. Pay Governance reports directly to the Compensation Committee, and the Compensation Committee has the sole power to terminate or replace Pay Governance at any time.
As part of its engagement, the Compensation Committee has directed Pay Governance to work with our Senior Vice President, Chief People Officer and other members of management to obtain information necessary for Pay Governance to form recommendations and evaluate management’s recommendations to the Compensation Committee. Pay Governance also meets with the Compensation Committee during its regular meetings, in executive session (where no members of management are present), and with the Compensation Committee chair and other members of the Compensation Committee outside of the Compensation Committee’s regular meetings. As part of its engagement in 2016, Pay Governance provided an environmental scan of executive compensation, evaluated the Company’s peer group composition, evaluated compensation levels at the peer group companies, assessed and proposed equity and cash compensation guidelines for various executive job levels, assessed compensation for the Company’s executive officers, advised on the framework for the Company’s long-term incentive awards, and assessed Board compensation. Pay Governance does not provide any other services to the Company.
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The Compensation Committee recognizes that it is essential to receive objective advice from its compensation advisors. To that end, the Compensation Committee closely examines the procedures and safeguards that its compensation advisor takes to ensure that its services are objective. The Compensation Committee has assessed the independence of Pay Governance pursuant to SEC rules and concluded that Pay Governance’s work for the Compensation Committee does not raise any conflict of interest.
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To set total compensation guidelines, we review market data of companies that are comparable to eBay and that we believe compete with eBay for executive talent, business, and capital. We review both specific data from peer group companies’ public filings and general industry data for comparable technology companies that are included in proprietary third party surveys. We believe that it is necessary to consider this market data in making compensation decisions to attract and retain talent. We also recognize that, at the executive level, we compete for talent against larger global companies, as well as smaller, non-public companies.
Compensation Discussion and Analysis |Further Considerations for Setting Executive CompensationReport
To assess whether the peer group continues to reflect the markets in which we compete for executive talent, the Compensation Committee reviews and approves the peer group each year with the assistance of its compensation consultant. In deciding whether a company should be included in the peer group, the Compensation Committee generally considers the following screening criteria:
For each member of the peer group, one or more of the factors listed above was relevant to the reason for inclusion in the group, and, similarly, one or more of these factors may not have been relevant to the reason for inclusion in the group.
A part of its annual review following the Spin-Off of PayPal, the Compensation Committee determined that several financial services companies were no longer relevant for eBay as a stand-alone company and added several technology companies that it believed were relevant following the Spin-Off based on the peer group selection criteria noted above. The companies removed from the peer group were American Express Company, Capital One Financial Corp., Charles Schwab & Co., Inc., MasterCard Incorporated and Visa Inc. The companies added to peer group were Electronic Arts Inc., LinkedIn Corporation, Netflix, Inc., PayPal Holdings, Inc., salesforce.com, inc., The Priceline Group Inc., and Twitter, Inc. As a result of these changes, the peer group consisted of the following companies for 2016:
Adobe Systems Incorporated
Alphabet Inc.
Amazon.com, Inc.
Cisco Systems, Inc.
Electronic Arts Inc.
Facebook, Inc.
Intel Corporation
Intuit Inc.
LinkedIn Corporation
Microsoft Corporation
Netflix, Inc.
PayPal Holdings, Inc.
salesforce.com, inc.
Symantec Corporation
The Priceline Group Inc.
Twitter, Inc.
Yahoo! Inc.
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We are limited by Section 162(m) of the Code to a deduction for federal income tax purposes of up to $1 million of compensation paid to our CEO and any of our other three most highly compensated executive officers, other than our CFO, in a taxable year. Compensation above $1 million may be deducted if, by meeting certain technical requirements, it can be classified as “performance-based compensation.” The annual cash incentive program was last approved by our stockholders in 2015. Under the annual cash incentive program, the portion of the awards attributable to Company performance is intended to qualify as “performance-based compensation” under Section 162(m). Certain grants under the 2008 Equity Incentive Award Plan, which was last approved by our stockholders in 2016, are also intended to qualify as “performance-based compensation.” Although the Compensation Committee uses the requirements of Section 162(m) as a guideline, deductibility is not the sole factor it considers in assessing the appropriate levels and types of executive compensation. The Compensation Committee expressly retains the full discretion to forgo deductibility when the Compensation Committee believes it to be in the interests of the Company and our stockholders.
Compensation | Compensation Committee
The CompensationHuman Capital Committee reviews and approves Company compensation programs on behalf of the Board. In fulfilling its oversight responsibilities, the Compensation and Human Capital Committee reviewed and discussed with management the Compensation Discussion and Analysis set forth in this Proxy Statement. Based upon the review and discussions referred to above, the Compensation and Human Capital Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement and eBay’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016.
COMPENSATION COMMITTEE2021.