qualifications of possible candidates after considering the function and needs of our Board of Directors. The
nominatingNominating and
corporate governance committeeCorporate Governance Committee meets to discuss and consider such candidates’ qualifications and then selects a nominee for recommendation to our Board of Directors by majority vote.
Our
nominatingNominating and
corporate governance committeeCorporate Governance Committee will consider director candidates recommended by stockholders and evaluate them using the same criteria as candidates identified by our Board of Directors or the
nominatingNominating and
corporate governance committeeCorporate Governance Committee for consideration. If one of our stockholders wishes to recommend a director candidate for consideration by the
nominatingNominating and
corporate governance committee,Corporate Governance Committee, the stockholder recommendation should be delivered to our Corporate Secretary at our principal executive offices and must include information regarding the candidate and the stockholder making the recommendation as required by our Bylaws.
As stated above, the
nominatingNominating and
corporate governance committeeCorporate Governance Committee seeks out candidates with a diversity of experience and perspectives. When considering candidates as potential members of our Board of Directors, our Board of Directors and our
nominatingNominating and
corporate governance committeeCorporate Governance Committee evaluate the candidates’ ability to contribute to such diversity. Our Board of Directors assesses its effectiveness in this regard as part of its annual evaluation process. Currently, of our
fivesix independent directors,
one is a woman,two are women, one is from an underrepresented racial/ethnic group, and
twothree have served for five years or less.
| | | | | | | | | | | | | | | | |
Board Diversity Matrix (As of April 25, 2023) | |
Total Number of Directors | | | | | 6 | |
| | Female | | | Male | | | Non-Binary | | | Did Not Disclose Gender | |
Part I: Gender Identity | | | | | | | | | | | | | | | | |
Directors | | | 1 | | | | 4 | | | | — | | | | 1 | |
Part II: Demographic Background | | | | | | | | | | | | | | | | |
African American or Black | | | — | | | | 1 | | | | — | | | | — | |
Alaskan Native or Native American | | | — | | | | — | | | | — | | | | — | |
Asian | | | — | | | | — | | | | — | | | | — | |
Hispanic or Latino | | | — | | | | — | | | | — | | | | — | |
Native Hawaiian or Pacific Islander | | | — | | | | — | | | | — | | | | — | |
White | | | 1 | | | | 3 | | | | — | | | | — | |
Two or More Races or Ethnicities | | | — | | | | — | | | | — | | | | — | |
LGBTQ+ | | | — | | | | — | | | | — | | | | — | |
Did Not Disclose Demographic Background | | | — | | | | — | | | | — | | | | 1 | |
21
Board Diversity Matrix (As of April 22, 2024)
| Part I: Gender Identity | |
| Directors | | | 2 | | | 4 | | | — | | | 1 | |
| Part II: Demographic Background | |
| African American or Black | | | — | | | 1 | | | — | | | — | |
| Alaskan Native or Native American | | | — | | | — | | | — | | | — | |
| Asian | | | — | | | — | | | — | | | — | |
| Hispanic or Latino | | | —- | | | — | | | — | | | — | |
| Native Hawaiian or Pacific Islander | | | — | | | — | | | — | | | — | |
| White | | | 2 | | | 3 | | | — | | | — | |
| Two or More Races or Ethnicities | | | — | | | — | | | — | | | — | |
| LGBTQ+ | | | — | | | — | | | — | | | — | |
| Did Not Disclose Demographic Background | | | — | | | — | | | — | | | 1 | |
People & Compensation Committee Interlocks and Insider Participation
None of the members of our
compensation committeePeople & Compensation Committee during
20222023 is
serving or has served as an officer or employee of ours. None of our executive officers currently serves, or in the past year has served, as a member of the Board of Directors or
compensation committeePeople & Compensation Committee of any entity that has one or more executive officers serving on our Board of Directors or
compensation committee.People & Compensation Committee.
Our compensation committeePeople & Compensation Committee conducted a risk assessment of its compensation policies and practices, including those related to executive compensation programs for NEOs. The risk assessment included an analysis of our executive compensation programs and broader employee incentive compensation plans. Our compensation committeePeople & Compensation Committee also considered how
Flywire Corporation 22 2024 Proxy Statement
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these programs compare, from a design perspective, to programs maintained by other companies. Based on this assessment, it was determined that our executive compensation programs are balanced and appropriately incent employees, and any risks arising from the compensation policies and practices are not reasonably likely to have a material adverse effect on Flywire.
Meetings of the Board of Directors
The Board of Directors held
fivesix meetings and acted by written consent
one timethree times during our year ended December 31,
2022.2023. No director attended fewer than 75% of the total number of meetings of the Board of Directors and any committees of the Board of Directors of which he or she was a member during our year ended December 31,
2022.2023. Our policy is to invite and encourage each member of our Board of Directors to be present at our annual meetings of stockholders.
ThreeFour of seven of our then serving members of our Board of Directors attended our
20222023 annual meeting of stockholders in their capacity as directors of our company.
Our Board of Directors has responsibility for the oversight of our risk management processes and, either as a whole or through its committees, regularly discusses with management our major risk exposures, their potential impact on our business and the steps we take to manage them. The risk oversight process includes receiving regular reports from board committees and members of senior management to enable our Board of Directors to understand our risk identification, risk management and risk mitigation strategies with respect to areas of potential material risk, including operations, finance, legal, regulatory, strategic and reputational risk.
The audit committee
Our Audit Committee reviews information regarding liquidity and operations, and oversees our management of financial risks. Periodically,
the audit committeeour Audit Committee reviews our policies with respect to risk assessment, risk management, loss prevention and regulatory compliance. Oversight by
the audit committeeour Audit Committee includes direct communication with our external auditors, and discussions with management regarding significant risk exposures and the actions management has taken to limit, monitor or control such exposures.
The compensation committeeOur People & Compensation Committee is responsible for assessing whether any of our compensation policies or programs has the potential to encourage excessive risk-taking.
The nominatingOur Nominating and
corporate governance committeeCorporate Governance Committee manages risks associated with the independence of the Board of Directors, corporate disclosure practices, potential conflicts of interest and corporate responsibility, including environmental, social and corporate governance matters. While each committee is responsible for evaluating certain risks and overseeing the management of such risks, the entire
boardBoard of Directors is regularly informed through committee reports about such risks. Matters of significant strategic risk are considered by our Board of Directors as a whole.
The following table sets forth information about the compensation of
the non-employee members of our Board of Directors who served as a director during our year ended December 31,
2022.2023. Other than as set forth in
22
the table and described more fully below, during our year ended December 31, 2022,2023, we did not pay any fees to, make any equity awards or non-equity awards to, or pay any other compensation to the non-employee members of our Board of Directors. Mr. Massaro, our chief executive officer,Chief Executive Officer, receives no compensation for his service as a director, and is not included in the table below. Mr. Riese currently serves as chairChair of our Board of Directors.
| | | | | | | | | | | | |
| | Fees Earned or Paid in Cash ($) | | | Stock Awards ($)(3)(4) | | | Total ($) | |
Yvonne Hao(1) | | $ | 42,000 | (5) | | $ | 174,987 | (6) | | $ | 214,987 | |
Matthew Harris | | $ | — | | | $ | — | | | $ | — | |
Alex Finkelstein | | $ | — | | | $ | — | | | $ | — | |
Jo Natauri(2) | | $ | — | | | $ | — | | | $ | — | |
Phillip Riese | | $ | 68,000 | | | $ | 174,987 | (7) | | $ | 242,987 | |
Edwin Santos | | $ | 54,000 | | | $ | 174,987 | (8) | | $ | 228,987 | |
| Yvonne Hao(1) | | | — | | | — | | | — | |
| Matthew Harris | | | — | | | — | | | — | |
| Gretchen Howard(2) | | | 11,587 | | | 349,984(7) | | | 361,571 | |
| Alex Finkelstein | | | 25,838 | | | 174,985(8) | | | 200,823 | |
| Jo Natauri(3) | | | — | | | — | | | — | |
| Diane Offereins (4) | | | 41,000 | | | 524,990(9)(10) | | | 565,990 | |
| Phillip Riese | | | 83,000 | | | 174,985(11) | | | 257,985 | |
| Edwin Santos | | | 59,000 | | | 174,985(12) | | | 233,985 | |
(1)
| Yvonne Hao resigned as a member of the Board of Directors on January 7, 2023. |
Flywire Corporation 23 2024 Proxy Statement
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(2)
| Gretchen Howard was appointed to the Board of Directors on September 19, 2023. |
(2)(3)
| Jo Natauri resigned as a member of the Board of Directors on January 7, 2023. |
(3)(4)
| Diane Offereins was appointed to the Board of Directors on January 9, 2023. |
(5)
| The amounts in this column represent the aggregate grant date fair value of stock awards granted to the director during our fiscal year ended December 31, 2022,2023, computed in accordance with FASB ASC Topic 718. See Note 12 to our financial statements included in the 20222023 Annual Report for a discussion of our assumptions in determining the ASC 718 values of our option awards.
|
(4)(6)
| As of December 31, 2022, 2023, our non-employee directors held option and RSU awards to acquire the following number of shares of common stock: |
| | | | | | | | |
| | Number of Shares Underlying Outstanding Awards | |
| | Option Awards | | | RSU Awards | |
Yvonne Hao(1) | | | — | | | | 9,062 | |
Matthew Harris | | | — | | | | — | |
Alex Finkelstein | | | — | | | | — | |
Jo Natauri(2) | | | — | | | | — | |
Phillip Riese | | | 518,096 | | | | 9,062 | |
Edwin Santos | | | — | | | | 18,784 | |
| Matthew Harris | | | — | | | — | |
| Gretchen Howard(2) | | | 0 | | | 11,415 | |
| Alex Finkelstein | | | 0 | | | 5,587 | |
| Diane Offereins(4) | | | 0 | | | 19,763 | |
| Phillip Riese | | | 438,000 | | | 5,587 | |
| Edwin Santos | | | 0 | | | 10,448 | |
(5)(7)
| $2,000 of this amount was paid inOn September 19, 2023, for 2022 services.
|
(6) | On May 31, 2022, Ms. HaoHoward was granted aan initial restricted stock unit award for 9,06211,415 shares of our common stock pursuant to our non-employee director compensation plan.
|
(7)(8)
| On May 31, 2022,June 4, 2023, Mr. RieseFinkelstein was granted aan annual restricted stock unit award for 9,0625,587 shares of our common stock pursuant to our non-employee director compensation plan. |
(8)(9)
| On May 31, 2022, Mr. SantosJanuary 9, 2023, Ms. Offereins was granted aan initial restricted stock unit award for 9,06214,176 shares of our common stock pursuant to our non-employee director compensation plan. |
23
(10)
| On June 4, 2023, Ms. Offereins was granted an annual restricted stock unit award for 5,587 shares of our common stock pursuant to our non-employee director compensation plan. |
(11)
| On June 4, 2023, Mr. Riese was granted an annual restricted stock unit award for 5,587 shares of our common stock pursuant to our non-employee director compensation plan. |
(12)
| On June 4, 2023, Mr. Santos was granted an annual restricted stock unit award for 5,587 shares of our common stock pursuant to our non-employee director compensation plan. |
Flywire Corporation 24 2024 Proxy Statement
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Non-Employee Director Compensation
For the year ended December 31,
2022,2023, pursuant to our then current
non-employee director compensation plan,
each non-employee member of our Board of Directors received the following cash and equity compensation for board services, as applicable:
| | Role | | Annual Cash Retainer (1)
| | Initial Equity Grant (2)(3)
| | Annual Equity Grant (3)(4)
|
Board of Directors | | Director | Director | $30,000 (increased to $35,000 in February 2023) | | $35,000 | | | Restricted Stock Unit
Award valued at $350,000 | | | Restricted Stock Unit
Award valued at $175,000 | |
| Chair | Chair | | $50,000 (increased to $65,000 in February 2023)65,000 | | | | | | | |
| Audit Committee | | Chair | Chair | | | $20,000 | | | | | | | |
| | Other Member | | Other | | | $10,000 | | | | | | | |
Compensation Committee | | Chair | | $12,000Member | | | | | | | | | | |
| People & Compensation Committee | Other Member | | $6,000Chair | | | $12,000 | | | | | | | |
| Other | | | $6,000 | | | | | | | |
| | | | Member | | | | | | | | | | |
| Nominating and Corporate Governance Committee | | Chair | Chair | | | $8,000 | | | | | | | |
| Other | Other Member | | $4,000 | | | | | | | |
| | | | Member | | | | | | | | | | |
(1)
| Annual cash retainers are payable quarterly. |
(2)
| Initial equity grants are automatically granted on the date the director is elected or appointed as a director and are calculated based on the closing price of our common stock on the date of grant. The initial equity grant upon election or appointment as a director shall vest in 3 equal annual installments following the grant date. |
(3)
| Such award will accelerate and fully vest upon a change in control, or such non-employee director’s earlier death or disability. |
(4)
| Annual equity grants are automatically granted two days prior to the date of each annual regular meeting of the Company’s stockholders and are calculated based on the closing price of our common stock on the date of grant. The annual equity grant shall vest on the 1-year anniversary of the grant date provided the director provides continuous service as a director, member of the applicable committee or chair, as applicable, through such date. |
Messrs.
Mr. Harris
and Finkelstein and Ms. Natauri havehas waived
the non-employee director RSUs and the cash compensation under
our non-employee director compensation program.
We also reimburse
our non-employee directors for their
reasonable out-of-pocket expenses incurred in attending Board of Directors and committee meetings.
Stockholder Communications with the Board of Directors
Stockholders wishing to communicate with our Board of Directors or with an individual member of our Board of Directors may do so by writing to our Board of Directors or to the particular member of our Board of Directors, care of our Corporate Secretary by mail to our principal executive offices, Attention: Corporate Secretary. The envelope should indicate that it contains a stockholder communication. All such stockholder communications will be forwarded to the director or directors to whom the communications are addressed.
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Flywire Corporation 25 2024 Proxy Statement
INFORMATION ABOUT OUR EXECUTIVE OFFICERSTABLE OF CONTENTS
Information About Our Executive Officers
The following table provides information concerning our executive officers as of April
10, 2023:8, 2024:Name | | Age
| | Position(s)
|
Michael Massaro | | 44 | 45 | | | Chief Executive Officer and Director | |
| Robert Orgel | | 54 | 55 | | | President and Chief Operating Officer | |
Michael Ellis | Cosmin Pitigoi | 54 | | 47 | | | Chief Financial Officer | |
| Peter Butterfield | | 58 | 59 | | | General Counsel and Chief Compliance Officer | |
| David King | | 54 | 55 | | | Chief Technology Officer | |
Michael Massaro
See biographical information set forth above under “Incumbent Class I Directors Whose Term Expires in 2025.”Robert Orgel
Robert
Orgel | President and Chief Operating Officer | Age: 55
Robert Orgelhas served as our President and Chief Operating Officer since November 2019. Mr. Orgel leads Flywire’s global payment network, business operations, finance, legal, compliance, and corporate strategy functions. He brings extensive experience with 20 years in the technology/payments ecosystem to Flywire, including hands-on experience in legal, compliance, finance, go-to-market, business development and global operations. Prior to Flywire, Mr. Orgel served in various roles at Apple Inc. from 2010 to 2019 where he was part of the leadership team that developed, launched and grew the Apple Pay business and global expansion as well as the launch of the Apple Card. Prior to his time at Apple Inc., Mr. Orgel served as Chief Operating Officer at Quattro Wireless, Inc. from 2008 until it was acquired by Apple Inc. in 2010. Mr. Orgel has also played key leadership roles at m-Qube, Inc., a carrier billing and payment platform which was acquired by Verisign Inc., and edocs Inc., an e-billing and payment solution which was acquired by Siebel Systems (subsequently acquired by Oracle Corporation). | |
| Mr. Orgel holds Bachelor of Arts and Master of Arts degrees in International Relations from Stanford University and a Juris Doctor degree from Harvard Law School. | |
Flywire including hands-on experience in legal, compliance, finance, go-to-market, business development and global operations. Corporation 26 2024 Proxy Statement
initiatives in Nelnet such as launching an online medical education program. Mr. King is also an owner of AmagiSoft, LLC, which provides gym membership management software to CrossFit gyms. He also led data security at Nelnet. Mr. King holds a Bachelor of Science in Mathematics and Physics from Westminster College, and a Master of Science in Physics from Miami University.
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TABLE OF CONTENTS
EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
This section discusses our compensation philosophy, summarizes our compensation programs and reviews compensation decisions for our named executive officers (NEOs) for the year ended December 31,
20222023 (Fiscal
2022)2023). The following discussion contains forward-looking statements that are based on our current plans, considerations, expectations, and determinations regarding existing and future compensation programs. The actual amount and form of compensation and the compensation policies and practices that we adopt in the future may differ materially from currently planned programs as summarized in this discussion.
For Fiscal
2022,2023, our NEOs were:
Michael Massaro, our Chief Executive Officer and member of our Board of Directors;
Robert Orgel, our President and Chief Operating Officer;
Michael Ellis, our Chief Financial Officer;
| • | | Sharon Butler
Michael Ellis, our former Chief Financial Officer(1), our Executive Vice President of Global Education; and; |
Peter Butterfield, our General Counsel and Chief Compliance Officer; and
David King, our Chief Technology Officer.
(1)
| Effective December 31, 2022, Ms. Butler is no longer considered an executive officerMarch 4, 2024, Mr. Ellis ceased serving as such term is defined under the Exchange Act. our Chief Financial Officer and principal financial officer. |
Fiscal
20222023 Business Highlights
During Fiscal
2022,2023, we
madecontinued to make targeted investments in
go-to-market, geographic expansion,
payment network growth, strategic partnership integrations and product and payment innovation. We saw the benefits of the execution of these growth strategies with notable success in our key investment areas, as we efficiently won new clients and cross-sold and
up-sold existing ones. Despite the
recent uncertain macroeconomic backdrop, the sustainability of our business model, combined with the resilience of the industries we serve, continued to position us well for ongoing success. Our business achievements during Fiscal
20222023 include:
| • | | Delivered Strong Financial Results. We delivered strong results across key performance metrics. Our total payment volume was $18.1over $24.0 billion, an increase of 37%33% year-over-year. Revenue increased 44%39% year-over-year to $289.4$403.1 million. |
| • | | Client Growth. We added over 590700 new clients, ending the year with over 3,1003,800 clients in our four primary verticals as we continued to win new clients and expand our channel partnerships around the world. We continued to help our clients get paid and help their customers pay with ease – no matter where they are in the world. In addition, we continued to focus on solving the major pain points for our clients and continue to invest in accelerating our ability to build, sell and deploy new solutions. |
| • | | Successful Acquisitions.We successfully integrated In November 2023, we acquired Learning Information Systems Pty Ltd (StudyLink), an Australian-based software as a service education company that provides platforms to education providers to support their student admissions systems and processes, including features such as eligibility assessment, offer generation, recruitment agent and commission management and acceptance processing. This follows our education vertical acquisitions and successful integration of each of the WPM Group Ltd. (WPM) business and signed more than 40 clients forin the combined solution. We also completed the acquisition ofUnited Kingdom in 2021 and Cohort Solutions Pty Ltd. (CohortGo) in Australia in 2022. |
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• | Launch of New Geographic Markets and integrated it intoStrengthening of Payment Networks. Since our education vertical,initial public offering in May 2021, we have added more than 10 new geographic markets for clients across our verticals, and bolstered our payment networks with a focus on supporting our key strategic payer markets like India and China, enhancing our educational agent solution. |
| • | | Launch of Inaugural ESG Report and Ongoing Work of The Flywire Charitable Foundation. In December 2022, we released our inaugural Environmental, Social and Governance (ESG) report, our first comprehensive summary of how we integrate social good initiatives into our business strategy. The report provides baseline metricsrelationships with WeChat Pay as well as a detailed overviewthree of the core tenets of Flywire’s ESG program, which are shaped by many defining principles—from social impact and community engagement, to diversity, equity and inclusion (DE&I), and much more. We continued to maximize our social impact initiatives both through the third annual scholarship program administered by The Flywire Charitable Foundation, and through purposeful philanthropy to non-profit organizations around the world. largest banks in India. |
27
| • | | Employee Growth and Culture. We grew from 665approximately 1,000 to approximately 1,000more than 1,200 full-time FlyMates in Fiscal 2022,2023, while being certified as a Great PlaceMost Loved Workplace in America by Newsweek, a Best Company to Work®, for by U.S. News & World Report and being named to Inc. Magazine’s Best Workplacesrecognized by Fortune Magazine as one of 2022, and Fortune Magazine’sthe Best Workplaces in Financial Services 2022.& Insurance™ 2023. |
Fiscal
20222023 Executive Compensation Program Highlights
Our Fiscal
20222023 compensation program for our NEOs reflects our overarching philosophy of
pay-for-performance.pay for performance. Highlights of our Fiscal
20222023 executive compensation program include:
| • | | Established aReviewed our Peer Group of Publicly-traded Companies. The People & Compensation Committee of our Board of Directors (Compensation(People & Compensation Committee) established areviewed and updated our peer group of publicly-traded technology companies to evaluate our compensation practices for purposes such as pay levels and compensation program design for our NEOs.
|
| • | | Review of Total Compensation Opportunities. After evaluatingThe People & Compensation Committee evaluated the competitive positioning of our NEOs’ target cashNEO’s compensation in the context of our overall compensation philosophy, we increased the Fiscal 2022 target cash compensation for our NEOs through adjustmentsrelative to the annual target cash bonus while maintaining or moderately increasing base salaries. These changes weremarket and made withadjustments considering both internal and external factors. In terms of market positioning, the goal of positioning total target cash compensation closer to the 25th percentile and total target direct compensation inPeople & Compensation Committee reference the 50th –- 75th percentile range of our peer group.market for target total compensation, with compensation weighted more heavily towards equity. |
| • | | Challenging Annual Incentive Goals. Our NEOs were eligible to earn a cash bonus based on our achievement of annual corporate goals established by our People & Compensation Committee and, other than Messrs. Massaro and Orgel, achievement of pre-established individual performance goals.Committee. Based on our strong Fiscal 20222023 performance, including revenue of $289.4$403.1 million and the achievementadjusted EBITDA of pre-established individual performance goals where applicable,$42 million, our NEOs earned bonuses between 87% and 107%of 130% of their target bonus for the year. |
| • | | Compensation Mix Weighted Towards Equity.Equity. Our NEOs total target direct compensation mix was more weighted towards equity than cash to emphasize alignment with stockholders and long-term performance. In Fiscal 2022, we implemented a job architecture framework for all FlyMates and in collaboration with our independent compensation consultant, analyzed roles and competencies, holistically reviewed market-competitive compensation practices, and implemented RSU awards as the basis for our equity compensation. Previously awarded options are factored into NEO compensation from a retention perspective, and in Fiscal 2022,2023, we granted an average of over 80% of our NEOs’ target direct compensation as equity-based compensation in the form of RSUs. In addition, we granted an additional RSU award to each of Ms. Butler and Mr. King based on their contributions to the company, importance of their respective roles and to further incentivize and retain them.restricted stock units (RSUs). We believe that RSUs, as well as previously issued unvested stock options, support retention and effectively align the interests of our executives with those of our stockholders by directly linking compensation to the value of our common stock. |
Compensation Philosophy and Objectives
Our compensation philosophy and guiding principles provide a framework for the development and management of our executive compensation programs and practices.
| • | | Competitive. Our compensation programs should be market-competitive, enabling Flywire to attract and retain top talent in a highly-competitive global, technology market. |
| • | | Pay-for-Performance. We strive to provide a strong relationship ofbetween pay toand performance. Annual performance-based cash bonuses are tied primarily to achievement of annual corporate financial goals and, for certain executives, differentiating compensation based on individual performance in recognition of innovation, excellence in delivery and outsized impact.goals. Long-term incentive awards deliver value based on the performance of our common stock.
|
28
| • | | Emphasis on Equity Compensation. Total compensation is heavily weighted toward equity incentive compensation. Long-term incentives focus our NEOs on sustainable and long-term stockholder value creation. The value realized by our NEOs depends on the value of our common stock, which we believe aligns our NEOs’ interests with the long-term interests of our stockholders. |
| • | | Fair and Fact-Based. We believe compensation decisions should be made based on objective and relevant information and support internal pay equity in support of our company core values of execution, ambitious innovation and global collaboration. |
| • | | Simple and Transparent. Our compensation programs should be easy to understand, communicate and administer. |
Flywire Corporation 29 2024 Proxy Statement
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In addition, our
People & Compensation Committee seeks to ensure that we maintain sound governance and compensation policies and practices. Our key compensation practices include the following:
What We Do | | | | What We Do Not Do | |
| ✓
| | | Employ a pay-for-performancepay for performance philosophy reflected in program design and target pay levels for NEOs | | | | × | | Guarantee bonuses to our executive officers | |
✓ | | | | Deliver majority of compensation in equity to promote executive retention and reward long-term value creation | | | | × | | Provide tax gross-ups | |
| ✓
| | | Cap maximum annual cash incentive bonus payouts | | | | × | | Permit hedging or short sales of our common stock | |
✓ | | | | Maintain and annually review a group of peer companies | | | | × | | Provide single trigger equity acceleration upon a change in control | |
| ✓
| | | Fully independent directors on our People & Compensation Committee | | | | × | | Maintain compensation plans that encourage excessive risk taking | |
✓ | | | | Engage an independent compensation consultant to advise our People & Compensation Committee | | | | × | | Provide significant executive perquisites or personal benefits | |
| | | | Utilize stock ownership guidelines to align our NEOs with long-term stockholder interests | |
| | | | Administer and enforce a policy to recover erroneously awarded incentive-based compensation | | | | | | | |
Compensation Governance and the Compensation-Setting Process
Role of Our
People & Compensation Committee
Our executive compensation program is designed and administered under the direction and control of our
People & Compensation Committee, which is made up solely of independent directors. Our
People & Compensation Committee reviews and approves our overall executive compensation
programs,program, policies, practices and metrics and sets the compensation of our executive officers, including our NEOs, as well as certain other members of our senior management team.
In fulfilling this responsibility, our People & Compensation Committee reviews the performance of each NEO at least once each year. Our CEO, as the manager of the executive team, assesses the executives’ contributions to the corporate goals and makes a recommendation to our People & Compensation Committee with respect to any merit increase in salary, cash bonus and annual equity awards for each member of the executive team, other than himself. Our People & Compensation Committee then meets with our CEO to evaluate, discuss and modify or approve these recommendations. Our People & Compensation Committee also conducts a similar evaluation of our CEO’s contributions when our CEO is not present, and determines any increase in salary, cash bonus and annual replenishment equity award for him.
Our
CEO provided the Compensation Committee with compensation summaries for each NEO early in Fiscal 2022. The Compensation Committee used the information in these summaries to assist with analyzing existing compensation and any proposed changes in compensation for each NEO. The summaries included information regarding the accumulated value of equity ownership, how much is unvested, and the amount of potential value29
earnable under various share price scenarios. The summaries help our Compensation Committee to track changes in an NEO’s total direct compensation from year to year and to remain aware of the compensation historically paid to each NEO. In fulfilling its responsibilities, our Compensation Committee reviews the performance of each NEO at least once each year.
OurPeople & Compensation Committee meets regularly throughout the year to review our executive compensation program with the goal of ensuring it is consistent with our short-term and long-term goals given the dynamic nature of our business and the market in which we compete for executive talent.
Our People & Compensation Committee received and reviewed compensation summaries for each NEO at the beginning of Fiscal 2023. The information in these summaries was used by our People & Compensation Committee to assist with analyzing existing compensation and any proposed changes in compensation for each NEO. The summaries included information regarding the accumulated value of unvested equity ownership, how much is unvested, and the amount of potential value earnable under various share price scenarios. The summaries help our People & Compensation Committee to track changes in an NEO’s compensation from year to year and to remain aware of the compensation historically paid to each NEO. In addition to the information and analyses supplied to our
People & Compensation Committee as described above and in the peer group segment below, members of our senior management team support our
People & Compensation Committee in its work from time to time.
Our People & Compensation Committee has the authority under its charter to directly retain, review fees for, and terminate advisors and consultants as it deems necessary to assist in the fulfillment of its responsibilities. For purposes of its Fiscal 20222023 executive compensation decisions, our People & Compensation Committee engaged Compensia, Inc. (Compensia)ClearBridge Compensation Group LLC (ClearBridge) as its independent compensation consultant (the compensation consultant). ClearBridge has served as the compensation consultant to our People & Compensation Committee since the second half of 2022. Our People & Compensation Committee’s compensation consultant
Flywire Corporation 30 2024 Proxy Statement
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provides information and analyses that serve as the basis for setting executive and director compensation levels and advises our
People & Compensation Committee on
compensationcompensation-related decisions. The compensation consultant
also advises our
People & Compensation Committee on the structure of executive and director compensation programs, including the design of incentive plans, the forms and mix of compensation, allocation of equity compensation, regulatory requirements and other topics relevant to executive and director compensation. Our
People & Compensation Committee reviews the independence of its compensation consultant annually and found no conflict of interest with
CompensiaClearBridge during its
Fiscal 20222023 independence review.
During the second half of 2022, our Compensation Committee engaged ClearBridge Compensation Group to replace Compensia as its independent compensation consultant.Our
People & Compensation Committee’s compensation
consultantsconsultant did not provide any additional services beyond
providing advice and recommendations on the
amount or form of compensation for our directors and managementcompensation-related items highlighted above during Fiscal
2022.2023. Our
People & Compensation Committee has adopted protocols governing if and when its compensation consultant’s advice and recommendations can be shared with management, recognizing that, in advising our
People & Compensation Committee, it is necessary for the compensation consultant to interact with management to gather information. Our
People & Compensation Committee also determines the appropriate forum for receiving recommendations from its compensation consultant. Where appropriate, our
People & Compensation Committee invites management to provide context for the recommendations. In other cases, our
People & Compensation Committee receives recommendations from its compensation consultant in executive sessions where management is not present. At such times as it deems necessary, our
People & Compensation Committee also engages directly with its compensation consultant between formal meetings of the
People & Compensation Committee. This approach further protects our
People & Compensation Committee’s ability to receive objective advice from its compensation consultant and establishes a forum for independent decisions about executive pay.
Our
People & Compensation Committee reviews market compensation levels at least annually to determine the placement of our executive compensation relative to the competitive market for executive talent. This assessment includes evaluation of base salary, and short- and long-term incentive opportunities against executive compensation reported by a peer group of companies selected by our
People & Compensation Committee as comparable to Flywire in size and related industry, among other criteria. Our
People & Compensation Committee also considers market compensation information collected from survey sources. The compensation consultant supports our
People & Compensation Committee in the selection of the peer group of companies and also provides our
People & Compensation Committee with analyses of each peer company’s executive compensation information.
30
OurIn July 2022, our People & Compensation Committee based in part on advice fromreviewed the changes suggested by its compensation consultant approved ato the group of peer companies in January 2022 which itthe committee had used as a reference group in making prior executive compensation decisions for Fiscal 2022. The peer group companies were the same used in connection with compensation decisions at the time of our initial public offering in 2021.decisions. Criteria considered to determine the recommended changes to the peer company group included industry, company size (i.e., revenue and market capitalization, historic growth rates, location, employee count,capitalization), as well as companies with a meaningful portion of business both in the U.S. and abroad, and duration of time in operation as a public company. While some ofBased on such factors, it was recommended that AvidXchange, EngageSmart, EVO Payments, Expensify, Payoneer Global, Remitly Global and Lightspeed Commerce be added to the compensation peer group members mayand that Anaplan, BigCommerce, Bill.com, C3.ai, Duck Creek Technologies, Everbridge, Jamf Holding, ON24, SailPoint Technologies, Sprout Social and Upstart Holdings be significantly larger than Flywire in termsremoved because the company did not meet one or more of revenuethe criteria discussed above and was no longer considered to be a meaningful comparison point or market capitalization,the company ceased to be publicly traded. Following this review, our People & Compensation Committee has determined that such companies should be included inselected the peer group primarily because we compete with them for talent. The following companies were selected as our peer group for reference purposes when making executive compensation decisions for Fiscal 2022:
2023:
| Asana | | | EngageSmart (acquired and taken private in January 2024) | | | Lightspeed Commerce | | | Payoneer Global | |
• | AvidXchange | Anaplan | | •EVO Payments (acquired in March 2023) | | Jfrog | nCino | | | Phreesia | |
• | BTRS Holdings (Billtrust) | Asana | | •Expensify | | nCino | Open Lending | | | Remitly Global | |
• | Domo | Big Commerce Holdings | | •JFrog | | ON24 |
• | | Bill.com Holdings | | • | | Open Lending |
• | | BTRS Holdings | | • | | Pager Duty |
• | | C3.ai | | • | | Phreesia |
• | | Domo | | • | | Repay Holdings |
• | | Duck Creek Technologies | | • | | SailPoint Technologies |
• | | Everbridge | | • | | Sprout Social |
• | | Jamf Holding | | • | | Upstart Holdings |
When making compensation decisions for our NEOs, our
People & Compensation Committee also reviews published survey and peer group compensation
data for other companies that operate in the same space as Flywire.data. Competitive market practices are an important factor in our
People & Compensation Committee’s decision-making process, although its decisions are not entirely based upon
these factors.market practices. Rather, our
People & Compensation Committee reviews and considers the peer group and other survey data to obtain a general understanding of current competitive compensation practices. Additionally, reviewing the peer group and survey compensation data enables our
People & Compensation Committee to accomplish our goal of paying our NEOs what is appropriate and necessary to attract and retain qualified and committed executives while incentivizing achievement of our corporate goals and conserving cash and equity.
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Flywire Corporation 31 2024 Proxy Statement
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Principal Elements of Compensation
Our executive compensation program has the following principal elements:
(i) base salary,
(ii) annual short-term cash incentive bonuses,
(iii) long-term incentive awards,
and (iv) severance and change in control
benefits and other benefits. For base salary, annual cash bonuses and long-term incentive awards for our executive officers, our Company’s compensation philosophy generally is to evaluate individual experience and contribution, as well as corporate performance, and then consider competitive market analysis. The markets we are serving are highly competitive for talent and executive leadership. We generally set target total compensation using the 50
th – 75
th percentile range
of our peer group as a reference point, with the mix more weighted towards equity than cash to emphasize alignment with stockholders and long-term performance. We believe it is important to drive our Company to over-perform the market in the long term. We also believe that to ensure an appropriate
pay-for-performancepay for performance alignment it may be appropriate for our
People & Compensation Committee to approve compensation levels for individual executives that may be above or below target pay for similar positions based on experience, individual contribution and corporate performance. The following table describes the primary compensation elements used by our Company and main objectives of each element:
Compensation Element | | Objectives
|
Base Salary | | | Our People & Compensation Committee sets base salaries with the intent to attract and retain NEOs, reward satisfactory performance and provide a minimum, fixed level of cash compensation to compensate NEOs for their day-to-day responsibilities. | |
| Annual Cash Incentive Bonus | | | Annual cash incentive bonuses are awarded under a performance-based compensation program and are designed to align the interests of our NEOs and stockholders by providing compensation based on the achievement of pre-established corporate and/or business goals and, for certain NEOs, individual performancefinancial goals. | |
| Long-Term Incentive Awards | | | Our People & Compensation Committee structures long-term incentive awards with the goal of aligning our NEOs’ interests with those of our stockholders, supportingsupport retention and motivatingmotivate NEOs to achieve our financial, strategic and operational goals. In Fiscal 2022,2023, long-term incentive awards were in the form of time-based vesting RSUs. | |
| Severance and Change in Control Benefits | | | Severance and change in control benefits are included in each NEO’s employment agreement in order to promote stability and continuity of our senior management team in the event of a potential change in control and/or an involuntary termination. Our People & Compensation Committee believes these provisions help to align each of our NEO’s interests appropriately with those of our stockholders in these scenarios. | |
Benefits | Benefits | | | We offer competitive health and welfare benefits, as well as participation in an employee stock purchase plan and other employee benefit plans, to align with competitive norms for comparable companies. | |
Fiscal
20222023 Compensation Decisions
In determining the criteria for our NEOs’ incentive compensation, our
People & Compensation Committee considers a variety of factors, including alignment of our NEOs’ compensation with our stockholders’ returns, and from time to time may adjust these factors or performance metrics based on our Company’s transactions or the occurrence of unknown or unexpected events, such as changes in accounting policies or shifts in regulatory environment, during the applicable measurement period. On the corporate level, our
People & Compensation Committee selected certain key financial metrics that are important to the business which include
Revenue Less Ancillary Servicesrevenue and
Adjustedadjusted EBITDA as metrics that our
People & Compensation Committee believes are important for both short-term success as well as for creating long-term sustainable stockholder
value creation.value. As a result, our NEOs are focused on
Revenue Less Ancillary Servicesrevenue and
Adjustedadjusted EBITDA, which we believe is aligned with our stockholders’ perspective on our Company’s ability to grow and succeed in the short- and long-term.
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Base salaries for our NEOs are initially determined as a result of negotiation between the executive and our management in consultation with, and subject to the approval of, our People & Compensation Committee. Our People & Compensation Committee reviews base salaries annually, typically in the first quarter, and has discretion to provide increases based on our People & Compensation Committee’s understanding of current competitive pay practices, promotions, our CEO’s recommendation (except for his own salary), changes in responsibilities and performance, annual budget for increases, our overall financial and operational results, the general economy, length of tenure, internal pay equity and other factors our People & Compensation Committee deems appropriate. Base salaries may also be adjusted during the year upon promotion or based on internal equity or external market conditions. Our People & Compensation Committee makes these decisions after reviewing the recommendation of our CEO (except
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(except as it concerns his own salary) and consulting with its compensation consultant. Following its review, in
March 2022,February 2023, our
People & Compensation Committee determined not to adjust the annual base salaries of
Messrs. Massaro and Orgel and to modestly increase the
annual base salaries of Ms. Butler and Messrs. Ellis and King.NEOs. The following table shows the annual base salary for each NEO for
each of Fiscal
2021 and Fiscal 2022, as well as any applicable percentage increase. | | | | | | | | | | | | |
Name | | Fiscal 2021 Base Salary | | | Fiscal 2022 Base Salary (1) | | | Percentage Increase | |
Michael Massaro | | $ | 450,000 | | | $ | 450,000 | | | | — | |
Robert Orgel | | $ | 350,000 | | | $ | 350,000 | | | | — | |
Michael Ellis | | $ | 300,000 | | | $ | 325,000 | | | | 8 | % |
Sharon Butler | | $ | 275,000 | | | $ | 300,000 | | | | 9 | % |
David King | | $ | 275,000 | | | $ | 300,000 | | | | 9 | % |
2023. | Michael Massaro | | | 450,000 | | | — | |
| Robert Orgel | | | 350,000 | | | — | |
| Michael Ellis | | | 325,000 | | | — | |
| Peter Butterfield | | | 300,000 | | | — | |
| David King | | | 300,000 | | | — | |
Annual Cash Incentive Bonus Compensation
Our annual cash incentive bonus compensation program promotes our pay-for-performancepay for performance philosophy by providing all of our NEOsexecutives and other management-level corporate employees with direct financial incentives in the form of annual cash awards for achievement of certain objective corporate financial strategic and, for certain NEOs, individual goals established and approved by our People & Compensation Committee at the start of the year. If we achieve results that are below certain threshold levels, these NEOs receive no cash incentive bonus, while results that are above certain threshold levels result in a cash incentive bonuses above target levels,bonus payout based on a pre-determined scale, subject to a maximum amount of 150% in Fiscal 2023 (up from 125% of target.in Fiscal 2022).
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Target Bonus Opportunities
Our
People & Compensation Committee sets each NEO’s individual target cash incentive amount based on each NEO’s employment agreement provisions, our CEO’s recommendation (except for his own target), internal pay equity, our
People & Compensation Committee’s general understanding of current competitive pay practices and other factors it deems appropriate. After evaluating the competitive positioning of our NEOs’ total target cash compensation in the context of our overall compensation philosophy,
in February 2023, our People & Compensation Committee determined not to adjust the target
bonusescash bonus amounts for
ourany of the NEOs,
wereother than Mr. Massaro. The target bonus for Mr. Massaro was increased
with the goal of positioningfrom $260,000 to $450,000 to position his total target cash compensation
closer to the 25th percentile and total target direct compensationmore competitively in the
50th – 75th percentile range of our peer group. Based on its review of these factors, in March 2022, our Compensation Committee adjustedmarket. As a result, the
total eligible cash bonus amounts for each of our NEOs for Fiscal
2022.33
The Fiscal 2021 and Fiscal 20222023 target bonus opportunities for our NEOs were:
| | | | | | | | |
Name | | Fiscal 2021 Target Bonus Opportunity | | | Fiscal 2022 Target Bonus Opportunity | |
Michael Massaro | | $ | 230,000 | | | $ | 260,000 | |
Robert Orgel | | $ | 175,000 | | | $ | 225,000 | |
Michael Ellis | | $ | 150,000 | | | $ | 225,000 | |
Sharon Butler | | $ | 175,000 | | | $ | 200,000 | |
David King | | $ | 100,000 | | | $ | 150,000 | |
For Fiscal 2022, the
| Michael Massaro | | | 450,000 | |
| Robert Orgel | | | 225,000 | |
| Michael Ellis | | | 225,000 | |
| Peter Butterfield | | | 150,000 | |
| David King | | | 150,000 | |
In addition, unlike in prior years where certain of our NEO’s cash incentive bonus
actually received by eachwas based on corporate and individual performance goals, our People & Compensation Committee determined that for Fiscal 2023 it would be based solely on 2023 corporate objectives for all of our
NEOs was determined based on certain corporate objectives and, other than in the case of Messrs. Massaro and Orgel, individual performance goals. Individual performance goals include a combination of factors such as department or vertical performance. The corporate component represented 70% of the target bonus opportunity for Messrs. Ellis and King and 25% of the target bonus opportunity for Ms. Butler.2022NEOs.
2023 Corporate Objectives
Our
People & Compensation Committee established
(a)(i) Revenue Less Ancillary Services and
(b)(ii) Adjusted EBITDA as the corporate components of our
20222023 cash incentive bonus program, with each of the components weighted as set forth below. We utilize these
non-GAAP financial measures internally in analyzing our financial results and evaluating our ongoing operational performance. These metrics were also selected because they are two of the key performance metrics stockholders use in evaluating Flywire. Revenue Less Ancillary Services represents our consolidated revenue in accordance with GAAP, less (x) pass-through cost for printing and mailing services and (y) marketing fees. Adjusted EBITDA represents EBITDA further adjusted by excluding (i) stock-based compensation expense and related payroll taxes, (ii) the impact from the change in fair value measurement for contingent consideration associated with acquisitions, (iii) the impact from the change in fair value measurement of any of our preferred stock warrants, (iv) other income (expense), net, (v) indirect taxes related to intercompany activity, (vi) acquisition related transaction costs, and (vii) employee retention costs, such as incentive compensation, associated with acquisition activities. Our
People & Compensation Committee has discretion to modify performance results that reflect significant transactions (such as acquisitions, divestitures, or newly-formed joint ventures) or other unusual items if such events were not anticipated at the time performance targets were initially established.
Each of the components was assigned a threshold level, which is the minimum achievement level that must be satisfied to receive a portion of the applicable bonus amounts, and a maximum level, which, if achieved or exceeded, would result in our NEOs receiving up to
125%150% of the target amount attributed to that component. The percentage payout for each of the financial components was determined using
a sliding scale based on actual performance compared tolinear interpolation between the
target performance.points shown in the table below.
The corporate components of the
Fiscal 20222023 cash incentive bonus program are set forth below:
| | | | | | | | | | | | | | | | |
Corporate Component | | Weighting | | | Threshold 75% payout | | | Target 100% payout | | | Maximum 125% payout | |
Revenue Less Ancillary Services | | | 50 | % | | $ | 248,000,000 | | | $ | 273,300,000 | | | $ | 300,600,000 | |
Adjusted EBITDA | | | 50 | % | | $ | 11,000,000 | | | $ | 13,750,000 | | | $ | 16,500,000 | |
2022 Corporate Component
In calculating our FY 2022
| Revenue Less Ancillary Services | | | 50% | | | $358,700,000 | | | $373,000,000 | | | $391,700,000 | |
| Adjusted EBITDA | | | 50% | | | $31,100,000 | | | $33,000,000 | | | $38,820,000 | |
For Fiscal 2023, for the Revenue Less Ancillary Services and Adjusted EBITDAcorporate component the revenue portion for the Travel business above an internal target was discounted 50% for purposes of determining the 2022 Corporate Component,overall achievement against the above payout thresholds.
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In Fiscal 2023, our
Compensation Committee, in consultation with our compensation consultant and after34
reviewing several alternative approaches, utilized its discretion to modify these performance results based on our July 2022 acquisition of CohortGo. As such, the committee determined that our modified Revenue Less Ancillary Services was $257.1$377.1 million, representingand our reportedAdjusted EBITDA was $42.0 million. These amounts were calculated using the pre-determined adjustment factors adopted in February 2023. Our Revenue Less Ancillary Services for the year ended December 31, 2022 of $267.12023 was adjusted to $377.1 million reduced by $10.0 million ofbased on pre-determined adjustments related to excluding revenue attributable to CohortGo,from the StudyLink acquisition and our modified Adjusted EBITDA was $12.7 million, representing our reported Adjusted EBITDAthe revenue portion for the year ended December 31, 2022Travel business above an internal target was discounted 50%. Our People & Compensation Committee did not make any discretionary adjustments to the calculation of $14.9 million, reduced by the estimated impact from CohortGo of $2.2 million. Therefore, as a result of these modifications our 2023 Revenue Less Ancillary Services or Adjusted EBITDA. Our NEOs received 84%111% payout for the Revenue Less Ancillary Services component and 90%150% for the Adjusted EBITDA component.
2022 Individual Components
In addition to the 2022 corporate components of our 2022 cash incentive bonus program, our Compensation Committee established individual performance goals for Ms. Butler and Messrs. Ellis and King. The individual component represented 30% of the target bonus opportunity for Messrs. Ellis and King and 75% of the target bonus opportunity for Ms. Butler.
These individual performance goals for Ms. Butler and Messrs. Ellis and King were selected by our Compensation Committee in consultation with our CEO at the outset of Fiscal 2022, and our Compensation Committee reviewed the achievement of such individual goals in February
2023
to determine the NEO’s individual performance result. The individual performance goals were specifically tailored to the functions led by each NEO and aligned to the achievement of our overall operating plan, including goals shown in the table below: | | | | | | |
Name | | Individual Performance Goals | | Percentage of Allocated Target Bonus Awarded | |
Sharon Butler
| | Increase education revenue; sign additional clients meeting certain criteria; increase UK client base. | | | 113 | % |
Michael Ellis
| | Manage earnings calls and investor relations; develop 2023 operating plan and financial models; manage financial team in connection with 2022 audit and Securities Exchange Act filings. | | | 98 | % |
David King
| | Successful integration of WPM and CohortGo; development of 2023 road map; migration of WPM infrastructure. | | | 92 | % |
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The above calculations resulted in the following payout amounts under the
20222023 cash incentive bonus program for each of our NEOs:
| | | | | | | | | | | | |
Name | | Target Bonus | | | Percentage of Target Awarded | | | Actual Bonus Awarded | |
Michael Massaro | | $ | 260,000 | | | | 87 | % | | $ | 226,200 | |
Robert Orgel | | $ | 225,000 | | | | 87 | % | | $ | 195,750 | |
Michael Ellis | | $ | 225,000 | | | | 90 | % | | $ | 203,175 | |
Sharon Butler | | $ | 200,000 | | | | 107 | % | | $ | 213,150 | |
David King | | $ | 150,000 | | | | 88 | % | | $ | 132,525 | |
2022
| Michael Massaro | | | $450,000 | | | 130% | | | $585,000 | |
| Robert Orgel | | | $225,000 | | | 130% | | | $293,000 | |
| Michael Ellis | | | $225,000 | | | 130% | | | $293,000 | |
| Peter Butterfield | | | $150,000 | | | 130% | | | $195,000 | |
| David King | | | $150,000 | | | 130% | | | $195,000 | |
2023 Long-Term Incentive Compensation
Our
People & Compensation Committee is
very focused on aligning pay with performance in our compensation program, and as such, we continue to evaluate the most effective way to do so. For Fiscal
2022, given our recent IPO and emphasis on retention, coupled with2023, recognizing the
volatility in the market and challenges with long-term goal setting
given the
volatility of the market and with the goal of driving behaviors for long-term success, our People & Compensation Committee determined the most effective way to align executives with stockholders was to award RSUs that are directly aligned with stockholders, with value driven by the share price. The number of shares underlying RSUs granted to our NEOs is based on our
People & Compensation Committee’s general understanding of competitive pay practices, our CEO’s recommendation (except with respect to his own awards), consultation with its compensation consultant, and other factors that our
People & Compensation Committee deems appropriate. In addition to the annual RSU awards, our
People & Compensation Committee may grant additional RSUs for merit, performance, retention or promotional purposes.
In Fiscal 2022, our Compensation Committee granted an additional exceptional RSU award to each of Ms. Butler and Mr. King based on their contributions to the company, importance of their respective roles and to further incentivize and retain them.In March
2022,2023, our
People & Compensation Committee granted the following time-based RSUs to our NEOs, which vest with respect to 25% of the shares after one year and the remainder vesting in
substantially equal quarterly installments over the following three years, subject to the officer’s continued employment.
Name | Michael Massaro | Number of Shares Underlying RSU Grant | | 284,436 | |
Michael Massaro | Robert Orgel | | 252,039 | 150,064 | |
Robert Orgel | Michael Ellis | | 126,019 | 101,023 | |
Michael Ellis | Peter Butterfield | | 90,014 | 71,599 | |
Sharon Butler | | | 72,011 | |
David King | | | 126,019120,640 | |
Severance and Change in Control Benefits
Severance and change in control benefits promote stability and continuity of our senior management team in the event of a potential change in control and/or an involuntary termination. Our People & Compensation Committee believes these provisions help to align our NEO’s interests appropriately with those of our stockholders in these scenarios. We have entered into employment agreements with each of our NEOs, which provide for at-will employment and, other than in the context of a termination without
Flywire Corporation 35 2024 Proxy Statement
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Cause or a Resignation for Good Reason (as such terms are defined in the employment agreements), may be terminated at any time. See
“Fiscal 2022Fiscal 2023 Potential Payments Upon Termination or Change in
Control”Control below for a description of the severance benefits and the acceleration benefits, if any, that Messrs. Massaro, Orgel, Ellis,
Butterfield and King
and Ms. Butler are entitled to pursuant to their employment agreements and equity award agreements.
36
Other Benefits and Perquisites
Our NEOs are eligible to participate in all of our employee benefit plans
(including our employee stock purchase plan, administered by our People & Compensation Committee), such as medical, dental, vision, group life and disability insurance and our 401(k)
plan as well as our employee stock purchase plan, in each case, on the same basis as our other employees. We are responsible for the administrative costs of the 401(k) plan. We match 50% of every dollar contributed up to 6% of salary, subject to certain limitations under the Internal Revenue Code.
In additionThere were no special benefits or perquisites provided to
the standard employee benefits offered to all employees generally, our executive officers are eligible for term life and supplemental disability insurance.any NEO in Fiscal 2023.
Recoupment and Related Policies
We have a comprehensive Code of
Conduct.Conduct and ensure that our employees comply with this policy. In accordance with this policy, we investigate all reported instances of questionable or unethical behavior, and where improper behavior is found to have occurred, we take appropriate remedial action up to and including termination. If the results of an investigation establish that one of our employees, officers or directors has committed fraud or engaged in some other improper act that has the result of causing our financial statements for any period to be restated or that otherwise adversely affects those financial statements, our Board has discretion to take immediate and appropriate disciplinary action against the individual, including but not limited to termination. In addition, our Board has discretion to pursue whatever legal remedies are available to prosecute the individual to the fullest extent of the law and to claw back or recoup any amounts he or she inappropriately received as a result of the improper action or inaction, including but not limited to any annual or long-term incentives that he or she received but would not have received had such act not be taken.
We intendIn July 2023, we adopted a Policy for the Recovery of Erroneously Awarded Compensation applicable to
adopt a general compensation recovery, or clawback, policyour executive officers (as defined for purposes of Section 16 of the Securities Exchange Act of 1934, as amended) covering our annual and long-term incentive award plans and arrangements consistent with the requirements of the Exchange Act Rule
10D-1 after Nasdaq releases final listing standards in accordance with such rule.
Our Insider Trading Policy, as amended and restated in the first quarter of 2023 (ITP), prohibits our employees (including officers) and directors, or any of their designees, from purchasing financial instruments (including prepaid variable forward contracts, equity swaps, collars, and exchange funds), or otherwise engaging in transactions, that hedge or offset, or are designed to hedge or offset, any decrease in the market value of our equity securities (i) granted to the employee or director as part of the compensation of the employee or director; or (ii) held, directly or indirectly, by the employee or director. In addition, our employees (including officers) and directors may not pledge our equity securities held by them without the prior clearance of one of our compliance officers.
Our ITP permits our directors, officers and employees to enter into trading plans complying with Rule 10b5-1 under the Exchange Act at a time when such individuals are not in possession of material non-public information. Certain of our executive officers and directors have adopted, and may in the future adopt, Rule 10b5-1 trading plans. Generally, under these trading plans, the individual relinquishes control over the transactions once the trading plan is put into place. Accordingly, sales under these plans may occur at any time during the term of the trading plan, including possibly before, simultaneously with, or immediately after significant events involving our company, and at other times, including during a closed trading window, when a director, officer, or employee may be prohibited from trading otherwise.
Stock Ownership Guidelines
To better align the interests of our executive officers with those of our stockholders, in July 2023 we adopted a stock ownership policy that requires our executive officers (as defined for purposes of Section 16 of the Securities Exchange Act of 1934, as amended) to hold specified amounts of Flywire stock or other qualifying equity securities. Qualifying equity securities include Flywire common stock, including both vested and unvested restricted stock unit awards that do not have an exercise or purchase price, and shares issuable under equity awards that vest based on the achievement of performance goals after such conditions have been satisfied. Qualifying equity securities include shares held by the executive or any immediate family members living in his or her household.
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COMPENSATION COMMITTEE REPORT*
Under the policy, ownership guidelines are five times (5x) annual base salary for our Chief Executive Officer and two times (2x) base salary for all other executive officers. Compliance with this policy is measured at the end of our fiscal year and is measured based on the closing price of the common stock on the applicable measurement date (or the last prior trading day if the measurement date is not a trading day). Each executive officer has five years from the later of (i) the effective date of the policy (July 2023) or (ii) the first date the individual became subject to the guidelines as an executive officer. If at that point an executive officer does not hold the required amount, then they are required to maintain 50% of any shares acquired through stock option exercises and vesting of restricted stock units until such time as the threshold is met. At the end of 2023, each executive officer had satisfied the stock ownership guidelines.
People & Compensation Committee Report*
Our
People & Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis with management. Based on such review and discussion, our
People & Compensation Committee has recommended to our Board of Directors that the Compensation Discussion and Analysis be incorporated by reference into our
2023 Annual Report
on Form 10-K for Fiscal 2022 and included in this proxy statement.
37
Respectfully submitted by the members of the People & Compensation Committee of our Board of Directors:
Diane Offereins, Chair
Matthew Harris
Gretchen Howard
* | The material in this report is not soliciting material, is not deemed filed with the SEC and is not to be incorporated by reference in any filing of Flywire Corporation under the Securities Act or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing. |