3
Back to Contents
Proxy 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. Page references are supplied to help you find further information in this proxy statement. This proxy statement and the accompanying proxy card(s) are first being distributed to stockholders of record on or about March 27, 2024.
Bio-Rad 20232024 Annual Meeting of Stockholders•
Date and Time: Tuesday, April 25, 2023 at 4 p.m. Pacific Daylight Time
•
| • | Date and Time: Tuesday, April 23, 2024 at 4 p.m. Pacific Daylight Time |
Location: 1000 Alfred Nobel Drive, Hercules, California 94547
•
| • | Location: 1000 Alfred Nobel Drive, Hercules, California 94547 |
Record Date: February 24, 2023
| • | Record Date: February 26, 2024 |
Eligibility to Vote (page 6)
You can vote if you are a holder of our Class A Common Stock or Class B Common Stock at the close of business on February 24, 2023.26, 2024.
How to Cast Your Vote (page 7)
You can vote by any of the following methods:
•
Promptly completing, signing and returning your proxy card(s) by mail;
•
| • | Promptly completing, signing and returning your proxy card(s) by mail; |
On the internet or by telephone, pursuant to the instructions provided on the proxy card(s) provided to you with your printed proxy materials; or
•
| • | On the internet or by telephone, pursuant to the instructions provided on the proxy card(s) provided to you with your printed proxy materials; or |
In person, at the annual meeting.
| • | In person, at the annual meeting. |
If a bank, broker or other nominee is the record holder of your stock on February 24, 2023,26, 2024, you will be able to vote by following the instructions on the voting instruction form or notice that you receive from your bank, broker or other nominee.
Voting Matters (pages 9, 18, 20, 218, 17 and 22)19)
| Item | | Board Vote Recommendation | | Page Reference
(for more detail) |
| 1. | Election of Directors | | FOR each Director Nominee | | 8 |
| 2. | Ratification of Auditors | | FOR | | 17 |
| 3. | Approval of the amended Bio-Rad Laboratories, Inc. 2017 Incentive Award Plan | | FOR | | 19 |
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 4 |
Item
| Board Vote
Recommendation
| Page Reference
(for more detail)
|
| FOR each Director Nominee
| 9
|
2.
Ratification of Auditors
| FOR
| 18
|
3.
Advisory Vote to Approve Executive Compensation
| FOR
| 20
|
4.
Advisory Vote on the Frequency of Future Advisory Votes to Approve Executive Compensation Every 1, 2 or 3 Years
| EVERY 3 YEARS
| 21
|
| AGAINST
| 22
|
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement4
Back to Contents
Board Nominees (page 9)8)
Name | Age | Director since | Occupation | Independent | Committee
Memberships | Other Public Company Boards |
Jeffrey L. Edwards | 62 | 2017 | Former EVP, Chief Financial Officer of Allergan, Inc. | Yes | – Legal & Regulatory Compliance | FibroGen, Inc. Clearside Biomedical, Inc. Lifecore Biomedical, Inc. |
Gregory K. Hinckley | 76 | 2017 | Former President of Mentor Graphics Corporation | Yes | | SI-BONE, Inc. |
Melinda Litherland | 65 | 2017 | Retired Partner, Deloitte & Touche LLP | Yes | – Legal & Regulatory Compliance | Rapid Micro Biosystems, Inc. |
Arnold A. Pinkston | 64 | 2017 | Corporate Vice President, General Counsel of Edwards Lifesciences Corporation | Yes | – Legal & Regulatory Compliance | |
Allison Schwartz | 42 | 2022 | Commercial Director of Bio-Rad Laboratories, (Canada) Limited | No | | |
Norman Schwartz | 73 | 1995 | President, Chief Executive Officer and Chairman of the Board of Bio-Rad | No | | |
| Name | | Age | | Director
since | | Occupation | | Independent
Under NYSE Rules | | Committee
Memberships | | Other Public
Company Boards |
| Jeffrey L. Edwards | | 63 | | 2017 | | Former EVP, Chief Financial Officer of Allergan, Inc. | | Yes | | – Audit – Compensation – Legal & Regulatory Compliance | | FibroGen, Inc. Clearside Biomedical, Inc. Lifecore Biomedical, Inc. |
| Gregory K. Hinckley | | 77 | | 2017 | | Former President of Mentor Graphics Corporation | | Yes | | – Audit – Compensation | | SI-BONE, Inc. |
| Melinda Litherland | | 66 | | 2017 | | Retired Partner, Deloitte & Touche LLP | | Yes | | – Audit – Legal & Regulatory Compliance | | Rapid Micro Biosystems, Inc. |
| Arnold A. Pinkston | | 65 | | 2017 | | Corporate Vice President, General Counsel of Edwards Lifesciences Corporation | | Yes | | – Legal & Regulatory Compliance | | |
| Allison Schwartz | | 43 | | 2022 | | Commercial Director of Bio-Rad Laboratories, (Canada) Limited | | No | | | | |
| Norman Schwartz | | 74 | | 1995 | | President, Chief Executive Officer and Chairman of the Board of Bio-Rad | | No | | | | |
Auditors (page 18)17)
We are asking our stockholders to ratify the appointment of KPMG LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2023.2024. Set forth below is summary information with respect to the aggregate fees billed for professional services rendered for the fiscal years ended December 31, 20222023 and 20212022 by KPMG LLP.
| | 2022 | | 2021 |
Audit Fees | $ | 7,351,000 | $ | 8,281,000 |
Audit-Related Fees | | 0 | | 0 |
Tax Fees | | 0 | | 0 |
All Other Fees | | 13,000 | | 18,000 |
| | | 2023 | | | 2022 | |
| Audit Fees | | $ | 6,767,000 | | | $ | 7,378,000 | |
| Audit-Related Fees | | | — | | | | — | |
| Tax Fees | | | — | | | | — | |
| All Other Fees | | | 13,000 | | | | 13,000 | |
Advisory (Non-Binding) Vote to Approve Executive CompensationApproval of the Amended Bio-Rad Laboratories, Inc. 2017 Incentive Award Plan (page 20)19)
We are asking our stockholders to cast a non-binding advisory vote to approve the compensation of our named executive officers.
Advisory (Non-Binding) Vote on the Frequency of Future Advisory Votes to Approve Executive Compensation Every 1, 2 or 3 Years (page 21)
We are asking our stockholders to cast a non-binding advisory vote to conduct future advisory votes to approve executive compensation EVERY THREE YEARS.
Stockholder Proposal: Political Disclosure (page 22)
A stockholder proposal is expected to be presented for a vote at the annual meeting.amended Bio-Rad Laboratories, Inc. 2017 Incentive Award Plan.
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 5 |
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement5
Back to Contents
Proxy Statement
20232024 ANNUAL MEETING
Our Board of Directors is soliciting the enclosed proxy in connection with our 20232024 annual meeting of stockholders (the “Annual Meeting”) to be held our corporate offices, 1000 Alfred Nobel Drive, Hercules, California 94547 on Tuesday, April 25, 202323, 2024 at 4:00 p.m., Pacific Daylight Time, and at any adjournments or postponements thereof. Copies of this proxy statement and the accompanying notice and proxy card(s) are first being mailed on or about March 29, 202327, 2024 to all stockholders entitled to vote.
We refer to Bio-Rad Laboratories, Inc. in this proxy statement as “we,” “our,” the “Company” or “Bio-Rad”.
General Information About the Meeting and Voting
What items of business will be voted on at the Annual Meeting?
The items of business scheduled to be voted on at the Annual Meeting are:
•
The election of two directors by the holders of outstanding Class A Common Stock and four directors by the holders of outstanding Class B Common Stock;
•
| • | The election of two directors by the holders of outstanding Class A Common Stock and four directors by the holders of outstanding Class B Common Stock; |
A proposal to ratify the selection of KPMG LLP as our independent auditors for the fiscal year ending December 31, 2023;
•
| • | A proposal to ratify the selection of KPMG LLP as our independent auditors for the fiscal year ending December 31, 2024; |
An advisory (non-binding) vote to approve executive compensation;
•
| • | Approval of the amended Bio-Rad Laboratories, Inc. 2017 Incentive Award Plan; and |
An advisory (non-binding) vote on the frequency of future advisory votes to approve executive compensation every 1, 2 or 3 years;
•
| • | Such other matters as may properly come before the meeting and at any adjournments or postponements thereof. |
A stockholder proposal, if properly presented at the annual meeting; and
•
Such other matters as may properly come before the meeting and at any adjournments or postponements thereof.
What is included in the proxy materials?
The proxy materials include:
•
Our proxy statement for the Annual Meeting;
•
| • | Our proxy statement for the Annual Meeting; |
Our 2022 Annual Report to Stockholders, which consists of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022; and
•
| • | Our 2023 Annual Report to Stockholders, which consists of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023; and |
Proxy card(s) for the Annual Meeting.
| • | Proxy card(s) for the Annual Meeting. |
What shares can I vote?
Our securities entitled to vote at the meeting consist of Class A Common Stock and Class B Common Stock (collectively, “Common Stock”). As of the close of business on February 24, 202326, 2024 (the “Record Date”), we had 24,521,58123,422,506 shares of Class A Common Stock and 5,074,1305,095,930 shares of Class B Common Stock issued and outstanding.
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement6
Back to Contents
How many votes am I entitled to per share?
For all matters where the holders of Class A Common Stock and Class B Common Stock vote together as a class, each share of Class A Common Stock is entitled to one-tenth of a vote and each share of Class B Common Stock is entitled to one vote. For all matters where the holders of Class A Common Stock and Class B Common Stock vote separately, including the election of directors, each share of Class A Common Stock and each share of Class B Common Stock is entitled to one vote. The sum of one-tenth the number of outstanding shares of Class A Common Stock and the number of outstanding shares of Class B Common Stock constitutes our “Voting Power.”
What constitutes a quorum for the Annual Meeting?
The presence, in attendance or by proxy, of the holders of a majority of our Voting Power, as defined above, will constitute a quorum for the transaction of business; provided, however, that the election of the Class A and Class B directors shall require the presence, in attendance or by proxy, of the holders of a majority of the outstanding shares of each respective class.
How many votes are needed to approve each item of business?
Six directors are to be elected at the meeting. The holders of Class A Common Stock, voting as a separate class, are entitled to elect two directors. The holders of Class B Common Stock, also voting as a separate class, are entitled to elect the other four directors. Our stockholders do not have any right to vote cumulatively in any election of directors. Directors elected by each class shall be elected by a majority of the votes cast in the respective class.
The proposal to ratify the appointment of our independent auditors the advisory (non-binding) vote to approve executive compensation, the advisory (non-binding) vote on the frequency of future advisory votes to approve executive compensation every 1, 2 or 3 years, and the stockholder proposalapproval of the amended Bio-Rad Laboratories, Inc. 2017 Incentive Award Plan must each receive the affirmative vote of a majority of our Voting Power present or represented by proxy at the meeting and entitled to vote on such matter in order for it to be approved.
With respect to the advisory (non-binding) vote on the frequency of future advisory votes to approve executive compensation every 1, 2 or 3 years, if none of the frequency alternatives receives the affirmative vote of a majority of our Voting Power, we will consider the frequency that receives the highest number of votes by our Voting Power to be the frequency that has been selected by our stockholders.
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 6 |
What effect do broker non-votes and abstentions have on the items of business?
The term “broker non-votes” refers to shares held by a brokerage firm or other nominee (for the benefit of its client) that are represented at the meeting, but with respect to which such broker or nominee is not instructed to vote by the beneficial holder on a particular proposal and does not have discretionary authority to vote on that proposal. Brokers and nominees do not have discretionary voting authority on certain non-routine matters, including the election of directors the advisory (non-binding) vote to approve executive compensation, the advisory (non-binding) vote on the frequency of future advisory votes to approve executive compensation every 1, 2 or 3 years, and the stockholder proposal,approval of the amended Bio-Rad Laboratories, Inc. 2017 Incentive Award Plan, and accordingly, may not vote on such matters absent instructions from the beneficial holder. Broker non-votes will not be counted in determining the number of votes cast on these non-routine matters. Brokers have discretionary authority to vote on the ratification of the Company’s independent auditors.
For purposes of determining the presence of a quorum, broker non-votes, as well as abstentions, will be counted as shares that are present and entitled to vote. With respect to the election of directors, broker non-votes and abstentions will not affect the outcome of a director’s election. With respect to the proposal to ratify the appointment of our independent auditors, there will be no broker non-votes in connection with this proposal because brokers have discretionary authority to vote on the ratification of the Company’s independent auditors, and abstentions will have the same effect as a vote against this proposal. With respect to the advisory (non-binding) vote to approve executive compensation,approval of the advisory (non-binding) vote on the frequency of future advisory votes to approve executive compensation every 1, 2 or 3 years, and the stockholder proposal,amended Bio-Rad Laboratories, Inc. 2017 Incentive Award Plan, abstentions will have the same effect as a vote against these proposals and broker non-votes will have no effect on the vote for these proposals.
How do I vote?
If you are the record holder of your stock as of the Record Date, you may submit a proxy by executing and returning the enclosed proxy card(s) in the provided postage-paid envelope. You may also vote on the internet or by telephone, pursuant to the instructions provided on the proxy card(s) provided to you with your printed proxy materials, or you may attend the Annual Meeting and vote your shares in person.
If a bank, broker or other nominee is the record holder of your stock on the Record Date, you will be able to vote by following the instructions on the voting instruction form or notice that you receive from your bank, broker or other nominee.
What happens if I do not provide instructions on how to vote or if other matters are presented for determination at the Annual Meeting?
Shares for which a properly executed proxy in the enclosed form is returned will be voted at the Annual Meeting in accordance with the directions on such proxy. If no voting instructions are indicated with respect to one or more of the proposals, the proxy will be voted in favor of those proposal(s), and to approve those other matters that may properly come before the Annual Meeting at the discretion of the person named in the proxy. The Board of Directors is not aware of any matters that might come before the meeting other than those mentioned in this proxy statement. If, however, any other matters properly come before the Annual Meeting, it is intended that the proxies
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 7
Back to Contents
will be voted in accordance with the judgment of the person or persons voting such proxies.
May I change my vote?
Yes. Any proxy may be revoked by the record owner of the shares at any time prior to its exercise by filing with our Secretary a written revocation or duly executed proxy bearing a later date or by attending the Annual Meeting and announcing such revocation or voting in person at the meeting. Attendance at the Annual Meeting will not, by itself, constitute revocation of a proxy. For shares held through a broker, the directions received from the broker must be followed in order to revoke a proxy, change a vote or to vote at the Annual Meeting.
What rights do I have if I dissent on an item of business?
There are no statutory or contractual rights of appraisal or similar remedies available to those stockholders who dissent from any matter to be acted upon at the meeting.
Who will bear the cost of soliciting votes for the Annual Meeting?
We will pay the cost of this proxy solicitation. In addition to solicitation by use of the mails, proxies may be solicited from our stockholders by our directors, officers and employees in person or by telephone, telegram or other means of communication. These directors, officers and employees will not be additionally compensated, but may be reimbursed for reasonable out-of-pocket expenses in connection with such solicitation. Arrangements will be made with brokerage houses, custodians, nominees and fiduciaries for forwarding of proxy materials to beneficial owners of shares held of record by such brokerage houses, custodians, nominees and fiduciaries and for reimbursement of their reasonable expenses incurred in connection therewith.
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement8
Back to Contents
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 7 |
Item 1. Election of Directors
The Board of Directors recommends that you vote FOR the director nominees named below for the class or classes of Common Stock that you hold.
Our Board of Directors currently has six members. The term of each of our current directors expires as of the date of the annual meeting of stockholders or on election and qualification of his or her successor. All of our current directors are standing for re-election to our Board. The Board of Directors appointed Alice N. Schwartz effective as of April 26, 2022 a Director Emeritus. A Director Emeritus has the option to attend Board meetings and receive Board materials at the discretion of the Secretary of the Company but does not have voting power and does not receive compensation.
At the Annual Meeting, the stockholders will elect six directors. The six persons nominated are: Jeffrey L. Edwards, Gregory K. Hinckley, Melinda Litherland, Arnold A. Pinkston, Allison Schwartz, and Norman Schwartz. The table below includes biographies for each nominee and an indication of the class of Common Stock for which the person is a director nominee. NormanAllison Schwartz is the fatherdaughter of AllisonNorman Schwartz. No other family relationships exist among our current and nominated directors or executive officers.
The directors elected at this meeting will serve until the next annual meeting of stockholders or until their respective successors are elected and qualified. Although it is not contemplated that any nominee will decline or be unable to serve as a director, in the event that at the meeting or any adjournments or postponements thereof any nominee declines or is unable to serve, the persons named in the enclosed proxy will, in their discretion, vote the shares subject to such proxy for another person selected by the Board.
DIRECTORDIRECTOR NOMINEES
 | | JEFFREY L. EDWARDS Former EVP, Chief Financial Officer of Allergan, Inc. Director Since: 2017 Age: 63 Class of Common Stock to Elect: L.EDWARDS FormerEVP,ChiefFinancialOfficerofAllergan,Inc.
DirectorSince: 2017
Age: 62
ClassofCommonStocktoElect:Class B
|
Mr. Edwards retired from Allergan, Inc., a multi-specialty health care company, in February 2015 after nearly 22 years at Allergan. From September 2005 to August 2014, he served as Executive Vice President, Finance and Business Development, Chief Financial Officer at Allergan. From 2003 to 2005 he served as Allergan’s Corporate Vice President, Corporate Development and previously served as Senior Vice President, Treasury, Tax and Investor Relations. Prior to joining Allergan, Mr. Edwards was with Banque Paribas and Security Pacific National Bank, where he held various senior-level positions in the credit and business development functions. Mr. Edwards currently serves on the Board of Directors and as Audit Committee chair of FibroGen, Inc., a publicly traded biopharmaceutical company,company; on the Board of Directors, the Nominating and Corporate Governance Committee and the Audit Committee of Clearside Biomedical, Inc., a publicly traded development stage pharmaceutical company,company; and on the Board of Directors, on the Nominating and Governance Committee and as the Audit Committee Chair of Lifecore Biomedical, Inc., a publicly traded company focused on diversified healthwhich is a fully integrated Contract Development and wellness solutions.Manufacturing Organization (CDMO) within the medical device and pharmaceuticals sectors. Mr. Edwards has over 30 years of public company experience. We believe that Mr. Edwards’ deep financial, capital allocation, and business development experience give him the qualifications and skills to serve as a director.
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 8 |
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 9
Back to Contents
 | | GREGORY K. HINCKLEY Former President of Mentor Graphics Corporation Director Since: K.HINCKLEY FormerPresidentofMentorGraphicsCorporation
DirectorSince:2017
Age: 76 ClassofCommonStocktoElect: 77
Class of Common Stock to Elect: Class B |
Mr. Hinckley retired from Mentor Graphics Corporation, a leader in computer automated software for electronics design, in July 2017 after 20 years at Mentor Graphics. From 1999 to July 2017, he served as President of Mentor Graphics. From 1997 to 1999, he served as Mentor Graphics’ Executive Vice President, Chief Operating and Financial Officer. Prior to joining Mentor Graphics in 1997, Mr. Hinckley served as Chief Financial Officer for VLSI Technology, Inc., a publicly traded integrated semiconductor device company, from 1992-1997, for Crowley Maritime Corporation from 1989-1991 and for Bio-Rad from 1983-1989. He currently serves as a director and on the Audit Committee of SI-BONE, Inc., a publicly traded orthopedic device company. Mr. Hinckley also serves as a trusteecompany, and as Chair ofon the Board of Portland State University. Mr. Hinckley previously served as a director for several other publicly traded companies including Intermec, Inc., a publicly traded provider of automated identification and data collection (AIDC) solutions, Super Micro, a publicly traded provider of advanced computer server systems and subsystems, and Amkor Technology, a leading supplier of outsourced semiconductor interconnect services. Mr. Hinckley has over 40 years of public company experience. We believe that Mr. Hinckley’s financial, operational and public board expertise give him the qualifications and skills to serve as a director.
 | | MELINDA LITHERLAND Retired Partner, Deloitte & Touche LLP Director Since: 2017 Age: 66 Class of Common Stock to Elect: LITHERLAND RetiredPartner,Deloitte&ToucheLLP
DirectorSince: 2017
Age: 65
ClassofCommonStocktoElect:Class A
|
Ms. Litherland retired in 2015 as a Partner at Deloitte & Touche LLP, where she worked since 1981. She is a certified public accountant with 34 years of experience working with life science and technology companies in both audit and consulting capacities. Ms. Litherland currently serves on the Board of Directors and as Audit Committee chair of Rapid Micro Biosystems, Inc., a publicly traded life sciences technology company. Ms. Litherland is a member of the American Institute of CPAs (AICPA) and previously served for 12 years on the Board of Directors of Ronald McDonald House Charities Bay Area, including serving on the Finance Committee. We believe that Ms. Litherland’s extensive financial and life sciences background gives her the qualifications and skills to serve as a director.
ARNOLDA.PINKSTON
CorporateVicePresident,GeneralCounselofEdwardsLifesciencesCorporation
DirectorSince: 2017
Age: 64
ClassofCommonStocktoElect: | | ARNOLD A. PINKSTON Corporate Vice President, General Counsel of Edwards Lifesciences Corporation Director Since: 2017 Age: 65 Class of Common Stock to Elect: Class A |
Mr. Pinkston is currently the Corporate Vice President, General Counsel of Edwards Lifesciences Corporation, a global leader in patient-focused medical innovations for heart disease, as well as critical care and surgical monitoring. Prior to joining Edwards in July 2019, he served as the Chief Legal Officer and Corporate Secretary of CoreLogic, Inc., a leading global property information, analytics and data-enabled solutions provider from January 2018 until June 2019. From 2011 until March 2015, he served as Executive Vice President and General Counsel for Allergan, Inc., a multi-specialty health care company. From 2005 until 2011, Mr. Pinkston served as Senior Vice President, General Counsel and Secretary for Beckman Coulter, Inc., a health care diagnostics and life sciences company. From 1994 until 2005, he held various positions at Eli Lilly and Company, a global pharmaceutical company, including Vice President and Deputy General Counsel. Additionally, Mr. Pinkston was formerly a director of Janus Capital Group, a publicly owned investment firm. Mr. Pinkston has over 25 years of experience at successful public companies. We believe that Mr. Pinkston’s broad corporate governance, regulatory and M&A knowledge give him the qualifications and skills to serve as a director.
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 9 |
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 10
Back to Contents
 | | ALLISON SCHWARTZ Commercial Director at Bio-Rad Laboratories (Canada) Limited Director Since: 2022 Age: 43 Class of Common Stock to Elect: SCHWARTZ CommercialDirectoratBio-RadLaboratories(Canada)Limited
DirectorSince: 2022
Age: 42
ClassofCommonStocktoElect:Class B
|
Ms. Schwartz is currently the Commercial Director at Bio-Rad Laboratories (Canada) Limited (a subsidiary of the Company), a role to which she was appointed in January 2023. Prior to this assignment, Ms. Schwartz served as the Marketing Director at Bio-Rad Laboratories (Canada) Limited from July 2021 to January 2023, and previously as the Commercial Services Director at the Company from 2016 until 2021, with accountabilities in these roles spanning global digital marketing, eCommerce, customer experience, and pricing. Since joining Bio-Rad in 2005, she has held positions in domestic and international brand development, product marketing and logistics management. We believe that Ms. Schwartz’s business experience and expertise give her the qualifications and skills necessary to effectively serve as a director of our Company.
 | | NORMAN SCHWARTZ Chairman of the Board, President and Chief Executive Officer Director Since: 1995 Age: 74 Class of Common Stock to Elect: SCHWARTZ ChairmanoftheBoard,PresidentandChiefExecutiveOfficer
DirectorSince: 1995
Age: 73
ClassofCommonStocktoElect:Class B
|
Mr. Schwartz has been our President and Chief Executive Officer since 2003 and our Chairman of the Board since 2012. He was our Vice President from 1989 to 2002, our Group Manager, Life Science, from 1997 to 2002 and our Group Manager, Clinical Diagnostics, from 1993 to 1997. We believe Mr. Schwartz’s financial and business expertise gained through over 4647 years of service with our Company, including as our President and Chief Executive Officer for over 2021 years, give him the qualifications and skills to serve as a director.
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement11
Back to Contents
Director| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 10 |
Director Compensation
The compensation of our Board of Directors is established by the Chairman of the Board.
Our Human Resources Department periodically provides the Chairman of the Board with market information on, and trends regarding, non-employee director compensation from other companies including our peer group (our method of determining our peer group is described in the section titled “Our Process for Setting Executive Compensation” below). The Chairman of the Board then will recommend any changes in non-employee director compensation to the Board, and the Board will either approve or not approve such recommended changes.
Employee directors receive no additional compensation for Board service.
Our
On December 6, 2019, our Board of Directors approved the compensation policy that was in effect during the year ended December 31, 2022until September 30, 2023 for our non-employee directors, on December 6, 2019, providing for the payment of cash fees as follows:
Board Role | Cash Fees
(until September 30, 2023)
($)
|
Board Member | 125,000 |
Lead Independent Director | 15,000 |
Audit Committee Chair | 20,000 |
Audit Committee Member | 10,000 |
Legal & Regulatory Compliance Committee Chair | 10,000 |
Legal & Regulatory Compliance Committee Member | 5,000 |
Compensation Committee Chair | 5,000 |
Compensation Committee Member | 3,000 |
On October 20, 2023, our Board of Directors approved a new compensation policy, effective October 1, 2023, providing for payment of fees for our non-employee directors as follows:
| Board Role | Cash Fees
(effective October 1, 2023)
($) |
| Board Member | 300,000* |
| Lead Independent Director | 25,000 |
| Audit Committee Chair | 25,000 |
| Audit Committee Member | 10,000 |
| Legal & Regulatory Compliance Committee Chair | 10,000 |
| Legal & Regulatory Compliance Committee Member | 5,000 |
| Compensation Committee Chair | 10,000 |
| Compensation Committee Member | 3,000 |
| * | The new compensation policy provides that if the stockholders approve the amendment of the 2017 Incentive Award Plan to allow equity grants to non-employee directors, then starting in 2024, the $300,000 Board Member retention fee will be split, with $200,000 payable in cash and $100,000 in equity grants of restricted stock units with a 4-year vesting cycle. |
Pursuant to this policy,both non-employee director compensation policies in effect in 2023, we pay no other types of meeting fees or committee service retainers to Board members. We also reimburse Board members for travel expenses relating to Board meetings. Our directors received no benefits in fiscal 20222023 under defined pension or defined contribution plans. We did not award equity to non-employee directors during 2022,2023, and none of our non-employee directors held any equity awards as of December 31, 2022.2023.
In 2022, a special committee of the Board of Directors was formed for a limited purpose. The following fees were approved for service on the special committee: One-time fee for Special Committee Member: $5,000. One-time fee for Special Committee Chair: $8,000.
The following table provides information about director compensation during 20222023 for our non-employee directors. Norman Schwartz serves as our Chief Executive Officer and his compensation is disclosed in the “Summary Compensation Table” beginning on page 3436 of this Proxy Statement. Allison Schwartz serves as an employee and her compensation is disclosed under “Transactions with Related Persons” beginning on page 1716 of this Proxy Statement.
| Name | Fees Earned or
Paid in Cash
($) | Total
($) |
| Jeffrey L. Edwards | 190,000 | 190,000 |
| Gregory K. Hinckley | 199,250 | 199,250 |
| Melinda Litherland | 195,000 | 195,000 |
| Arnold A. Pinkston | 178,750 | 178,750 |
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 11 |
Name | Fees Earned or Paid in Cash ($) | Total ($) |
Jeffrey L. Edwards | 150,000 | 150,000 |
Gregory K. Hinckley | 161,000 | 161,000 |
Melinda Litherland | 155,000 | 155,000 |
Arnold A. Pinkston | 140,000 | 140,000 |
Alice N. Schwartz(1) | 40,179 | 40,179 |
(1) Alice Schwartz retired from her position as a director effective as of April 26, 2022, and the Board of Directors appointed her a Director Emeritus effective as of April 26, 2022. A Director Emeritus has the option to attend Board meetings and receive Board materials at the discretion of the Secretary of the Company but does not have voting power and does not receive compensation. The fees shown are for her service as a director until April 26, 2022. |
|
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 12
Back to Contents
Information About the Board of Directors and Corporate GovernanceCONTROLLED COMPANY
CONTROLLED COMPANY
Because the Schwartz family holds more than 50% of our Voting Power and the votes necessary to elect a majority of our Board of Directors through its ownership of our Class B Common Stock, we are a “controlled company” for purposes of the New York Stock Exchange listing standards.
INDEPENDENTINDEPENDENT DIRECTORS
Jeffrey L. Edwards, Gregory K. Hinckley, Melinda Litherland and Arnold A Pinkston are “independent” directors, as determined in accordance with the independence standards set forth in Section 303A.02 of the New York Stock Exchange Listed Company Manual.
COMMITTEES OF THE BOARD OF DIRECTORS
Our Board of Directors has an Audit Committee, a Compensation Committee and a Legal and Regulatory Compliance Committee. Because we are a “controlled company,” as explained above, our Board of Directors has no nominating committee or other committees performing similar functions. Our Board of Directors also may from time to time appoint other special committees formed for a particular purpose. In 2022, a special committee of the Board of Directors was formed for a limited purpose, and this special committee has now been disbanded. Gregory K. Hinckley served as Chair of the special committee and Jeffrey L. Edwards, Melinda Litherland and Arnold A. Pinkston served as members of the special committee. The special committee met two times in 2022.
Current Director | Audit Committee |
Compensation
Committee | Legal & Regulatory
Compliance Committee |
Jeffrey L. Edwards | 
 |
|
|
Gregory K. Hinckley** | 
 |
| |
| Melinda Litherland | * | | |
Melinda Litherland
| *
| |
|
Arnold A. Pinkston | | | * |
| * | | *
|
|
| ** | Lead Independent Director |
During 2022,2023, the Audit Committee was comprised of Jeffrey L. Edwards, Gregory K. Hinckley and Melinda Litherland, all of whom are “independent” directors as determined in accordance with the independence standards set forth in Rule 10A-3 under the Securities Exchange Act of 1934, as amended, and Section 303A.02 of the New York Stock Exchange Listed Company Manual. Each director on the Audit Committee is able to read and understand fundamental financial statements, including a company’s balance sheet, income statement and cash flow statement. Our Board of Directors has determined that each of Jeffrey L. Edwards, Gregory K. Hinckley and Melinda Litherland qualifies as an audit committee financial expert.
Our Board of Directors adopted an Audit Committee Charter on June 7, 2000 and amended it most recently on February 21, 2018, a copy of which is available at the Corporate Governance section of our website, www.bio-rad.com. As set forth in the Audit Committee Charter, the purpose of our Audit Committee is to assist our Board of Directors with its oversight responsibilities regarding: (i) the integrity of our financial statements; (ii) our compliance with legal and regulatory requirements; (iii) our independent auditor’s qualifications and independence; and (iv) the performance of our internal audit function and independent auditor.
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 12 |
Our Audit Committee is directly responsible for the appointment, compensation, retention and oversight of the work of any independent auditor we engage, including resolution of any disagreements between our management and the independent auditor regarding financial reporting, and is responsible for reviewing and evaluating our accounting policies and system of internal accounting controls. In addition, our Audit Committee reviews the scope of our independent auditor’s audit of our financial statements, reviews and discusses our audited financial statements with management, approves in advance audit and non-audit services performed by our independent auditors,
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 13
Back to Contents
reviews significant financial risk exposures, reviews legal matters that could have a significant impact on financial statements, prepares the annual Audit Committee reports that are included in our proxy statements and annually reviews the Audit Committee’s performance and the Audit Committee Charter, among other responsibilities. Our Audit Committee has the authority to obtain advice and assistance from, and receive appropriate funding from us for, any independent counsel, experts or advisors that the Audit Committee believes to be necessary or appropriate in order to enable it to carry out its duties. Our Audit Committee Charter and Corporate Governance Guidelines provide that the members of the Audit Committee may not serve on the audit committees of the boards of directors of more than two other companies at the same time as they are serving on our Audit Committee unless our Board of Directors determines that such simultaneous service would not impair the ability of such member to effectively serve on our Audit Committee. The Board of Directors has determined that Jeffrey L. Edwards’ service on the audit committee of three other companies at the same time as he serves on our Audit Committee does not impair his ability to effectively serve on our Audit Committee. Our Audit Committee met nine times in 2022.2023. A more complete discussion is provided in the “Report of the Audit Committee of the Board of Directors” of this proxy statement.
During 2022,2023, the Compensation Committee was comprised of Jeffrey L. Edwards and Gregory K. Hinckley. The Compensation Committee met fivesix times in 20222023 to make determinations regarding compensation for the senior management team. Mr. Edwards and Mr. Hinckley are “independent” directors, as stated above, and meet the definition of a “non-employee director” within the meaning of Rule 16b-3 under the Securities Exchange Act of 1934, as amended. Our Board of Directors adopted a Compensation Committee charter on July 24, 2013 and amended it most recently on October 23, 2019, a copy of which is available at the Corporate Governance section of our website, www.bio-rad.com. The Compensation Committee has overall responsibility for evaluating and approving certain elements of the compensation of our executives. A discussion of the Compensation Committee’s duties and functions is provided in the “Compensation Discussion and Analysis” section of this proxy statement.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
No member of our Compensation Committee was at any time during 20222023 or at any other time an officer or employee of the Company, except that Gregory K. Hinckley was an officer (Vice President and Chief Financial Officer) of the Company from 1983-1989. No member of our Compensation Committee had any relationship with the Company requiring disclosure under Item 404 of Regulation S-K promulgated by the Securities and Exchange Commission.
None of our executive officers has served on the board of directors or compensation committee of any other entity that has or has had an executive officer who served as a member of our Board of Directors or Compensation Committee during 2022.2023.
LEGAL AND REGULATORY COMPLIANCE COMMITTEE
The Legal and Regulatory Compliance Committee was formed on April 26, 2017. During 2022,2023, the Legal and Regulatory Compliance Committee was composed of Arnold A. Pinkston, Jeffrey L. Edwards and Melinda Litherland. The Legal and Regulatory Compliance Committee met four times in 2022.2023. Our Board of Directors adopted a Legal and Regulatory Compliance Committee charter on April 26, 2017 and amended it most recently on FebruaryOctober 20, 2019,2023, a copy of which is available at the Corporate Governance section of our website, www.bio-rad.com. The Legal and Regulatory Compliance Committee has responsibility for assisting the Board with its oversight of (i) the Company’s compliance with the Foreign Corrupt Practices Act of 1977 and other anti-corruption, anti-kickback and false-claims laws, (ii) the Company’s Compliance Program and related compliance policies, and (iii) the Company’s cybersecurity risk management programs and reviewing with management the Company’s cybersecurity, data privacy and other risks relevant to the Company’s information technology controls and security.
NOMINATING COMMITTEE FUNCTIONS
Our Board of Directors does not have a standing nominating committee or a committee performing similar functions. Because we are a “controlled company” as stated above, we are not required to have a standing nominating committee comprised solely of independent directors. Our Board of Directors believes that it is appropriate for us not to have a standing nominating committee because we are controlled by the Schwartz family. Notwithstanding this, each member of our Board of Directors participates in the consideration of director nominees. Gregory K. Hinckley, Jeffrey L. Edwards, Melinda Litherland and Arnold A.
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 13 |
Pinkston are all “independent” directors, as stated above; Allison Schwartz and Norman Schwartz are not.
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 14
Back to Contents
Our Board of Directors has not adopted a charter governing the director nomination process. However, it is the policy of our Board of Directors to consider stockholder nominations for candidates for membership on our Board of Directors that are properly submitted as set forth below under the caption “Communications with the Board of Directors” and the section titled “Stockholder Proposals.” The stockholder must submit a detailed resume of the candidate together with a written explanation of the reasons why the stockholder believes that the candidate is qualified to serve on our Board of Directors. In addition, the stockholder must include the written consent of the candidate, provide any additional information about the candidate that is required to be included in a proxy statement pursuant to the rules and regulations of the Securities and Exchange Commission and the Company’s Amended and Restated Bylaws, and must also describe any arrangements or undertakings between the stockholder and the candidate regarding the nomination.
DIRECTOR QUALIFICATIONS
The director qualifications our Board of Directors has developed to date focus on what our Board of Directors believes to be those competencies that are essential for effective service on our Board of Directors. Qualifications for directors include technical, operational and/or economic knowledge of our business and industries; experience in operational, financial and/or administrative management; financial and risk management acumen; and experience in or familiarity with international business, markets and cultures, technological trends and developments, competence in environmental, social and governance (ESG) issues, including but not limited to issues relating to sustainability and climate change and diversity and inclusion, competence in risk evaluation and mitigation, and corporate securities and tax laws. While a candidate may not possess every one of these qualifications, his or her background should reflect many of these qualifications. In addition, a candidate should possess integrity and commitment according to the highest ethical standards; be consistently available and committed to attending meetings; be able to challenge and share ideas in a positive and constructively critical manner; and be responsive to our needs and fit in with other Board members from a business culture perspective.
Our Board of Directors identifies director nominees by first evaluating the current members of our Board of Directors who are willing to continue in service. Current members with qualifications and skills that are consistent with our Board of Directors’ criteria for Board service are re-nominated. As to new candidates, our Board of Directors generally polls its members and members of our management for their recommendations and may consult third party advisors. Our Board of Directors may also review the composition and qualification of the boards of our competitors and may seek input from industry experts or analysts. Our Board of Directors reviews the qualifications, experience and background of the candidates, and as discussed below, considers diversity in these areas among all the Board members. In making its determinations, our Board of Directors evaluates each individual in the context of the Board as a whole, with the objective of assembling a group that can best perpetuate our success and represent stockholder interests through the exercise of sound judgment. Any recommendations properly submitted by stockholders will be processed and are subject to the same criteria as any other candidates.
Each of the nominees included in the enclosed proxy card(s) was recommended for inclusion by all of the members of our Board of Directors.
DIVERSITY
Independence
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 15
Our assessment of the qualifications of nominees for the Board of Directors includes consideration of their demographic backgrounds, including, without limitation, gender, race and ethnicity. While a nominee’s demographic background is an important consideration, nominees are not chosen or excluded solely or primarily on that basis; instead, we focus on skills, experience and background that can lead to an effective Board and complement or supplement existing skills and experience of the Board. We seek to nominate directors with a variety of complementary backgrounds and skills so that as a group, the Board will possess the appropriate talent, skills and expertise to oversee our businesses. As set forth above, the qualifications we look for in nominees for directors (both new candidates and current Board members) include technical and operational knowledge of our business and industries; experience in operational, financial and/or risk management; familiarity with international business, markets and cultures and technological trends and developments, competence in environmental, social and governance (ESG) issues, including but not limited to issues relating to sustainability and climate change and diversity and inclusion, competence in risk evaluation and mitigation, as well as corporate securities and tax laws. Because not every nominee will possess all of these qualifications, our Board considers diversity in these and other factors when evaluating each nominee in the context of the Board as a whole. We strive to build a diverse board representing a range of backgrounds, experiences and perspectives. Our Board is committed to building on its diversity in future refreshment opportunities.
Our Board of Directors does not have a policy regarding the separation of the roles of Chief Executive Officer and Chairman of the Board as the Board believes it is in the best interest of the Company to make that determination based on the position and direction of the Company and the membership of the Board. Our Board of Directors has determined that having Norman Schwartz serve as Chief Executive Officer and Chairman of the Board is in the best interest of the Company’s stockholders at this time. This structure permits Mr. Schwartz to manage our day-to-day operations and oversee the Board’s activities efficiently.
Our Corporate Governance Guidelines provide that in the absence of an independent Chairman of the Board, the designation of a Lead Independent Director facilitates Board processes and controls and strengthens the cohesiveness and effectiveness of the Board as a whole. The duties of the Lead Independent Director set forth in our Corporate Governance Guidelines include the following: (i) preparing the agenda for, calling and presiding over executive sessions of the independent directors; (ii) serving as a sounding board for the Chairman and, on certain matters, acting as a liaison between the independent directors and the Chairman; (iii) in the event of the absence or the incapacity of the Chairman, presiding over Board meetings and acting as the spokesperson for the Board, and if requested by the Board, being available for consultation and direct communication with major stockholders; (iv) providing his/her unique perspective, as Lead Independent Director, to the Compensation Committee in connection with its annual formal evaluation of the CEO’s performance; (v) having the capacity to suggest to the Chairman that particular items be placed on the final agenda of each Board meeting; (vi) informally consulting with other directors from time to time regarding the number and length of Board meetings, the quality, quantity, timeliness, scope and organization of pre-meeting materials and Board meeting presentations and providing appropriate suggestions regarding the same to the Chairman; (vii) receiving notice of all committee meetings and having the ability to attend and observe (in an ex-officio capacity) from time to time committee meetings where appropriate to facilitate the execution of the Lead Independent Director’s duties; (viii) in appropriate circumstances, upon consultation with the Board, providing counsel to the Chairman with respect to the retention of consultants, legal counsel or other independent advisors that may assist the Board in the performance of its duties from time to time; and (ix) performing such other functions as directed by the independent directors from time to time. Gregory K. Hinckley is currently the Lead Independent Director.
Companies face a variety of risks, including credit risk, liquidity risk and operational risk. The Board of Directors believes an effective risk management process will timely identify the material risks that the Company faces, communicate necessary information with respect to material risks to senior executives and, as appropriate, to the Board of Directors or the relevant Board committee, implement appropriate and responsive risk management strategies consistent with the Company’s risk profile and integrate risk management into the Company’s decision-making. We have a Chief Compliance Officer that reports to the Chief Executive Officer. Our entire Board of Directors oversees general risk management of the Company and continually works, with the input of the Company’s executive officers, to assess and analyze the most likely areas of future risk for the Company. The Board of Directors also encourages management to promote a corporate culture that incorporates risk management into the Company’s corporate strategy and day-to-day business operations. Our Board of Directors oversees risks relating to environmental, social and governance (ESG) matters. In addition, our Audit Committee assists our Board of Directors with oversight of the Company’s financial statements, significant financial risk exposures, compliance with legal and regulatory requirements, and oversight of the independent auditor. Also, the Legal and Regulatory Compliance Committee assists the Board with its oversight of (i) the Company’s compliance with the Foreign Corrupt Practices Act of 1977 and other anti-corruption, anti-kickback and false-claims laws, (ii) the Company’s Compliance Program and related compliance policies, and (iii) the Company’s cybersecurity risk management programs and reviewing with management the Company’s cybersecurity, data privacy and other risk relevant to the Company’s information technology controls and security. We believe that the leadership structure of our Board of Directors supports effective oversight of the Company’s risk management.
We maintain various policies and procedures relating to the review, approval, or ratification of transactions in which we are a participant and in which any of our directors, executive officers, greater than 5% stockholders or their family members have a direct or indirect material interest. Our Management Guidelines provide that our Board or certain executive officers, depending on the dollar value of the transaction, review and approve all material transactions through the expenditure approval procedures set forth in the Management Guidelines. Our Code of Business Ethics and Conduct, which applies to all of our directors, officers, employees, and in some cases, their family members, prohibits arrangements, agreements and acts which are, or may give the impression of being, conflicts of interest with us and requires prompt disclosure to the Corporate Compliance Department and the individual’s manager, if applicable, of an actual or potential conflict of interest. In addition, we have a Conflict of Interest Policy for Executive Officers and Directors which provides additional conflict of interest controls for our executive officers and directors. Each quarter we also require our regional sales managers and financial officers to sign and send a written representation letter to the corporate financial reporting group wherein they are asked to disclose any related party transactions of which they are aware. In addition, each year we require our directors and executive officers to complete a questionnaire which, among other things, identifies transactions or potential transactions with us in which a director or an executive officer or one of their family members or associate entities has an interest.
Individuals, including stockholders, may contact an individual director, the Board as a group, or a specified Board committee or group, including the non-employee directors or independent directors as a group, by writing to Attention: Corporate Secretary, Bio-Rad Laboratories, Inc., 1000 Alfred Nobel Drive, Hercules, California 94547. The Corporate Secretary will promptly forward all such communications to the Chairman of the Board. Gregory K. Hinckley is currently the Lead Independent Director and presides over the meetings of our independent directors as a group.
Our commitment to good corporate governance is embodied in our Corporate Governance Guidelines. The Corporate Governance Guidelines set forth the Board’s processes and procedures to assist it in the exercise of its responsibilities and to serve the interests of the Company and its stockholders.
Our Corporate Governance Guidelines, along with our Code of Business Ethics and Conduct, Audit Committee Charter, Compensation Committee Charter, and Legal and Regulatory Compliance Committee Charter, are available at the Corporate Governance section of our website, www.bio-rad.com. Stockholders may also obtain a printed copy of these documents without charge by writing to the Corporate Secretary at the address indicated above.
The Board of Directors recommends that you vote FOR ratification of KPMG LLP to serve as our independent auditors for the fiscal year ending December 31, 2023Our Board of Directors recommends that you vote FOR ratification of KPMG LLP to serve as our independent auditors for the fiscal year ending December 31, 2024
|
Our Audit Committee has selected KPMG LLP, independent registered public accountants, to serve as our auditors for the fiscal year ending December 31, 2023.2024. A representative of KPMG LLP is expected to attend the Annual Meeting to make a statement if he or she desires to do so and to respond to appropriate questions.
Although we are not required to do so, we wish to provide our stockholders with the opportunity to express their opinion on the selection of auditors, and accordingly we are submitting a proposal to ratify the selection of KPMG LLP. If our stockholders should fail to ratify this proposal, our Board of DirectorsAudit Committee will consider the selection of another auditing firm.
Report of the Audit Committee of the Board of Directors
Our Audit Committee was established in 1992. Our Board of Directors adopted an Audit Committee charter on June 7, 2000 and amended it most recently on February 21, 2018, a copy of which is available at the Corporate Governance section of our website, www.bio-rad.com. During the fiscal year ended December 31, 2022,2023, the Audit Committee was comprised of Jeffrey L. Edwards, Gregory K. Hinckley and Melinda Litherland, all of whom are “independent” directors, as determined in accordance with the independence standards set forth in Rule 10A-3 under the Securities Exchange Act of 1934, as amended, and Section 303A.02 of the New York Stock Exchange Listed Company Manual.
Our management is responsible for our internal controls and our financial reporting process. Our independent accountants are responsible for performing an independent audit of our consolidated financial statements in accordance with generally accepted accounting practices,principles, attesting to the effectiveness of the Company’s internal control over financial reporting and issuing reports thereon. Our Audit Committee’s responsibility is to monitor and oversee these processes. The following is our Audit Committee’s report submitted to the Board of Directors for the fiscal year ended December 31, 2022.2023.
Our Audit Committee has:
•
reviewed and discussed our audited financial statements with management;
•
| • | reviewed and discussed our audited financial statements with management; |
| • | reviewed and discussed our assessment of internal control over financial reporting with management; |
| • | discussed with KPMG LLP, our independent auditors, the matters required to be discussed by the applicable requirements of the Public Accounting Oversight Board and the Securities and Exchange Commission; and |
| • | received the written disclosures and the letter from KPMG LLP, our independent auditors, required by applicable requirements of the Public Company Accounting Oversight Board regarding our independent auditors’ communications with the Audit Committee concerning independence, and has discussed with our independent auditors the independent auditors’ independence. |
reviewed and discussed our assessment of internal control over financial reporting with management;
•
discussed with KPMG LLP, our independent auditors, the matters required to be discussed by the applicable requirements of the Public Accounting Oversight Board and the Securities and Exchange Commission; and
•
received the written disclosures and the letter from KPMG LLP, our independent auditors, required by applicable requirements of the Public Accounting Oversight Board regarding our independent auditors’ communications with the Audit Committee concerning independence, and has discussed with our independent auditors the independent auditors’ independence.
Based on the review and discussions referred to above, our Audit Committee recommended to our Board of Directors that the audited consolidated financial statements be included in our Annual Report on Form 10-K for the fiscal year ended December 31, 20222023 for filing with the Securities and Exchange Commission.
| | THE AUDIT COMMITTEE |
| |
| Melinda Litherland
|
| Jeffrey L. Edwards
|
| Gregory K. Hinckley |
The Audit Committee report shall not be deemed “soliciting material” or incorporated by reference by any general statement incorporating by reference this proxy statement into any filing under the Securities Act or the Exchange Act and shall not otherwise be deemed filed under these Acts.
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 18
Back to Contents
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 17 |
Audit Fees, Audit-Related Fees, Tax Fees and All Other Fees: Fees,Audit-RelatedFees,TaxFeesandAllOtherFees:Set forth below are the aggregate fees billed for professional services rendered for the fiscal years ended December 31, 20222023 and 20212022 by KPMG LLP.
| 2022 | 2021 |
Audit Fees(1) | $ | 7,351,000 | $ | 8,281,000 |
Audit-Related Fees(2) | 0 | 0 |
Tax Fees(3) | 0 | 0 |
All Other Fees(4) | 13,000 | 18,000 |
(1) Audit Fees included aggregate fees for professional services performed in connection with the audit of our annual consolidated financial statements and internal controls, the reviews of our consolidated financial statements included in our Quarterly Reports on Form 10-Q, issuance of comfort letters and consents related to SEC registration statements, and attestation services for the statutory audits of international subsidiaries. The fees incurred for KPMG LLP’s services for fiscal year 2021 are set forth in our 2022 Proxy Statement filed with the SEC on March 30, 2022 and have been updated in this 2023 Proxy Statement to reflect final amounts of fees incurred. Such fees for fiscal year 2022 are subject to subsequent adjustment in our 2024 Proxy Statement if final amounts billed differ from the current estimates. (2) Audit-Related Fees included aggregate fees for services rendered during the fiscal year for assurance and related services that are reasonably related to the performance of the audit or review of our consolidated financial statements and are not reported under “Audit Fees.” (3) Tax Fees included aggregate fees for professional services performed in connection with tax planning and tax compliance. (4) All Other Fees included fees for (i) performing agreed upon procedures in relation to the Company’s submission to the California Department of Toxic Substance Control and Contra Costa County Health and Services Hazardous Materials Program in 2021 and 2022, and (ii) providing negative assurance associated with Switzerland gender pay gap analysis in 2021. |
| | | 2023 | | | 2022 | |
| Audit Fees(1) | | $ | 6,767,000 | | | $ | 7,378,000 | |
| Audit-Related Fees(2) | | | — | | | | — | |
| Tax Fees(3) | | | — | | | | — | |
| All Other Fees(4) | | | 13,000 | | | | 13,000 | |
| (1) | Audit Fees included aggregate fees for professional services performed in connection with the audit of our annual consolidated financial statements and internal controls, the reviews of our consolidated financial statements included in our Quarterly Reports on Form 10-Q, issuance of comfort letters and consents related to SEC registration statements, and attestation services for the statutory audits of international subsidiaries. The fees incurred for KPMG LLP’s services for fiscal year 2022 are set forth in our 2023 Proxy Statement filed with the SEC on March 29, 2023 and have been updated in this 2024 Proxy Statement to reflect final amounts of fees incurred. Such fees for fiscal year 2023 are subject to subsequent adjustment in our 2025 Proxy Statement if final amounts billed differ from the current estimates. |
| (2) | Audit-Related Fees included aggregate fees for services rendered during the fiscal year for assurance and related services that are reasonably related to the performance of the audit or review of our consolidated financial statements and are not reported under “Audit Fees.” |
| (3) | Tax Fees included aggregate fees for professional services performed in connection with tax planning and tax compliance. |
| (4) | All Other Fees included fees for performing agreed upon procedures in relation to the Company’s submission to the California Department of Toxic Substance Control and Contra Costa County Health and Services Hazardous Materials Program in 2022 and 2023. |
The Audit Committee pre-approves each and every service performed by our independent auditors, including the services described in each of the four subcategories above.
Our Audit Committee has considered whether the provision of services described above under the caption “Audit Fees, Audit-Related Fees, Tax Fees and All Other Fees” is compatible with maintaining our independent auditors’ independence and has determined that the provision of such service to us does not compromise the independent auditor’s independence.
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 18 |
19
Back to Contents
Item 3. Advisory (Non-Binding) Vote to Approve Executive Compensation
Approval of the Amended Bio-Rad Laboratories, Inc. 2017 Incentive Award Plan| The Board of Directors recommends that you vote FOR the approval of the amended Bio-Rad Laboratories, Inc. 2017 Incentive Award Plan. |
On February 15, 2017 (the “2017 Effective Date”), the Board approved the adoption of the Bio-Rad Laboratories, Inc. 2017 Incentive Award Plan, which was approved by our stockholders on April 25, 2017 (the “2017 Plan”). On February 9, 2024, the Board approved amendments to the 2017 Plan for the purpose of, among other things: (i) allowing non-employee directors of the Board to participate in the Equity Plan; (ii) extending the expiration date of the plan to February 9, 2034; and (iii) removing certain provisions that were included in the 2017 Plan to allow for the grant of “performance-based compensation” under Section 162(m) of the Internal Revenue Code that are no longer applicable. The Equity Plan, as amended (the “Equity Plan”) is attached to this proxy statement as Annex A and will be effective as the date of adoption by the Board, subject to stockholder approval.
THIS PROPOSAL IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE ACTUAL TERMS AND CONDITIONS OF THE EQUITY PLAN, WHICH IS ATTACHED AS ANNEX A TO THIS PROXY STATEMENT.
Share Limit
The Company is not seeking to increase the shares available for issuance under the Equity Plan. As of February 26, 2024, there were (a) 80,895 shares subject to outstanding options, (b) 337,058 shares subject to outstanding RSUs, (c) 8,381 shares subject to outstanding PSUs (assuming target performance level), and (d) 1,140,669 shares remaining available for future awards under the Equity Plan. Set forth below is information in respect of the Company’s historical burn rate, overhang and other measures:
| • | In 2023, 2022 and 2021, we granted equity awards representing a total of approximately 210,233, 151,951 and 101,545 shares, (assuming target performance level for the 2022 and the 2023 PSUs), respectively. This level of equity awards represents a three-year average burn rate of 0.52% of fully diluted weighted-average common shares outstanding during the period. |
| • | Based on historical usage, we estimate that the shares reserved for issuance under the Equity Plan would be sufficient for approximately 4 to 5 years of awards, assuming we continue to grant awards consistent with our historical usage and current practices, as reflected in our three-year average burn rate, and noting that future circumstances may require us to change our current equity grant practices. |
| • | In 2023, 2022 and 2021, our end of year overhang rate, calculated by dividing (i) the number of shares subject to equity awards outstanding at the end of the fiscal year plus the number of shares remaining available for issuance under the Equity Plan, by (ii) the number of our shares outstanding at the end of the fiscal year (assuming target performance level for the 2022 PSUs and not including the 2023 PSUs which were forfeited), was 5.49%, 5.69%, and 6.0%, respectively. If the Equity Plan is approved, we expect our overhang at the end of 2024 will be approximately 4.98%. |
Continuing Implementation of Governance Best Practices
The principal purpose of the Equity Plan is to provide incentives to our employees and members of the Board in the form of options, restricted stock units and other equity awards to stimulate their personal and active interest in our financial success and induce them to remain in our service. The material terms of the Equity Plan approved by the Board are described below. The following terms were included in the Equity Plan based on the Board’s ongoing efforts to incorporate evolving best practices into our executive compensation program, as well as the recommendations of management:
| • | Conservative share counting, consistent with our ordinary course practices; |
| • | Awards granted under the Equity Plan will vest no earlier than the first anniversary of the date the award is granted (subject to certain limited exceptions); |
| • | Requirement that all awards are subject to any Company clawback policy, consistent with the terms and conditions of the agreements signed by awardees; |
| • | Prohibition on dividend and dividend equivalents being paid on unvested awards; |
| • | Prohibition on repricing options or SARs without stockholder approval; and |
| • | Annual limit of $250,000 on the value awards granted to a non-employee director as compensation for services as a non-employee director during any fiscal year. |
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 19 |
Overview of the Equity Plan
The principal terms and conditions of the Equity Plan are summarized below.
Authorized Shares:
Under the Equity Plan, as of the 2017 Effective Date, an aggregate of 1,405,000 shares plus any of the 594,714 shares, which as of 2017 Effective Date were available for issuance under the 2007 Incentive Award Plan of Bio-Rad Laboratories, Inc., as amended (the “Prior Plan”), plus any shares which were subject to awards under the Prior Plan that, on or after the 2017 Effective Date, terminate, expire or lapse (collectively, the “Share Limit”) were initially reserved for issuance and may be issued or transferred pursuant to awards under the Equity Plan. The shares covered by the Equity Plan may be authorized but unissued shares, treasury shares or shares purchased in the open market. As of February 26, 2024 the closing price of a share of Class A Common Stock on the NYSE was $338.16 and the closing price of a share of Class B Common Stock on the NYSE was $337.15.
The Company is not seeking to increase the shares available for issuance under the Equity Plan.
Share Counting Provisions:
To the extent that an award under the Equity Plan is forfeited, expires, or the award is settled for cash (in whole or in part), any shares subject to the award at such time will be available for future grants under the Equity Plan. The following shares may not be added back to the number of shares available for issuance under the Equity Plan: (a) shares tendered to pay the exercise price of a stock option; (b) shares withheld for payment of taxes for an award; (c) shares subject to SARs that are not issued in connection with stock settlement; and (d) shares purchased on the open market with cash proceeds from the exercise of stock options. Any shares repurchased by us at the same price paid by the participant so that such shares are returned to us will again be available for future awards. Further, the following will not be counted against the shares available for issuance under the Equity Plan: (i) the payment of dividend equivalents in cash in conjunction with any outstanding awards will not be counted against the shares available for issuance under the Equity Plan and (ii) to the extent permitted by applicable law or any exchange rule, shares issued in assumption of, or in substitution for, any outstanding awards of any entity acquired in any form of combination by the Company or any of our subsidiaries, except as may be required by reason of Section 422 of the Code.
Plan Administration and Grant Making Process:
Our Board will generally administer the Equity Plan. The Equity Plan provides that, subject to certain limitations, the Board may from time to time delegate its authority to grant awards to a committee consisting of one or more members of the Board or one or more of our officers. Subject to the terms and conditions of the Equity Plan, the administrator will have the authority to select the persons to whom awards are to be made, to determine the type of awards to be granted and the number of shares to be subject to awards and the terms and conditions of awards, to determine when awards can be settled in cash, shares, other awards or whether to cancel, forfeit or surrender awards, to prescribe the form of award agreement, to accelerate vesting or lapse restrictions and to make all other determinations and to take all other actions necessary or advisable for the administration of the Equity Plan. The administrator will also be authorized to adopt, amend or rescind rules relating to the administration of the Equity Plan.
Award Eligibility:
The Equity Plan provides that awards may be granted to employees or members of the Board of the Company and our subsidiaries. The administrator determines which of such employees or members of the Board will be granted awards and no person is entitled to participate in the Equity Plan as a matter of right. Currently, we have 7 executive officers, 6 members of the board, and approximately 1,584 employees other than executive officers eligible to participate in the Equity Plan.
Award Types:
The Equity Plan provides that the administrator may grant or issue stock options, SARs, restricted stock, restricted stock units, dividend equivalents and other stock or cash based awards, or any combination thereof. Each award will be set forth in a separate agreement with the person receiving the award and will indicate the type, terms and conditions of the award, including exercise price, vesting schedule, and treatment of awards upon termination of employment, if applicable. Vesting provisions may require certain conditions to be met, such as continued employment or specified performance goals, before a participant may receive the shares underlying an award or before such shares become freely tradeable and nonforfeitable.
Awards may be made subject to our achievement of the level specified by the administrator or the compensation committee for one or more of performance goals, including the following: (i) gross or net sales or revenues; (ii) net income; (iii) pre-tax income; (iv) operating income; (v) cash flow (including, but not limited to, operating cash flow and free cash flow); (vi) earnings per share; (vii) operating margin; (viii) return on equity; (ix) return on invested capital or assets; (x) cost reductions or savings; (xi) expense levels; (xii) working capital; (xiii) economic value; (xiv) funds from operations; (xv) appreciation in the Fair Market Value of Stock; (xvi) total stockholder return; (xvii) implementation or completion of critical projects or initiatives or milestones related to such projects; (xviii) regulatory body approval for commercialization of a product; (xix) segment or product market share; (xx) product development; (xxi) manufacturing and manufacturing capacity; (xxii) acquisitions or sales of assets (including intellectual property) or subsidiaries; (xxiii) in-licensing and out-licensing of intellectual property; (xxiv) customer acquisition, expansion and retention or any combination of the foregoing; and (xxv) earnings before or after any one or more of the following items: interest, taxes, depreciation or amortization, any of which may be measured either in absolute terms or as compared to any incremental increase or decrease or as compared to results of a peer group or to market performance indicators or indices. The administrator may provide that one or more adjustments be made to these performance goals.
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 20 |
Stock Options and Stock Appreciation Rights:
Stock options are rights to purchase shares at a specified exercise price. Stock options will be either nonqualified stock options (“NQSOs”) or incentive stock options (“ISOs”). SARs are awards entitling the awardee to exercise all or a specified portion thereof (to the extent then exercisable pursuant to its terms) and to receive an amount determined by multiplying the difference obtained by subtracting the exercise price per share of such award from the fair market value on the date of exercise of such award by the number of shares with respect to which such award shall have been exercised. SARs may be settled in cash or shares, or in a combination of both, at the election of the administrator.
The exercise price per share subject to each stock option and SAR may not be less than fair market value on the date of grant (other than certain substitute options and SARs granted in connection with a corporate transaction) or, in the case of ISOs granted to an individual who owns (or is deemed to own) at least 10% of the total combined voting power of all classes of the Company’s capital stock, 110% of the fair market value of a share on the date of grant. Options and SARs will become exercisable (at the discretion of the administrator) in one or more installments after the grant date, subject to the participant’s continued employment or service with the Company or one of its subsidiaries and/or subject to the satisfaction of corporate performance targets and individual performance targets. The Equity Plan provides that options and SARs may be granted for any term specified by the administrator that does not exceed ten (10) years or, in the case of an ISO granted to an individual who owns (or is deemed to own) at least 10% of the total combined voting power of all classes of the Company’s capital stock, five (5) years.
Restricted Stock:
Restricted stock consists of shares of our common stock that may not be sold, assigned, transferred or pledged until certain restrictions or other requirements have expired or been removed. Restricted stock will be granted to any eligible individual selected by the administrator and will be made subject to such restrictions as may be determined by the administrator, including, without limitation, vesting conditions based on continued employment or service or on performance criteria established by the administrator. Restricted stock, typically, will be forfeited for no consideration or repurchased by the Company at the original purchase price or such other amount as may be specified in the award agreement if the conditions or restrictions on vesting are not met. The Equity Plan provides that restricted stock generally may not be sold or otherwise transferred until restrictions are removed or expire. Recipients of restricted stock, unlike recipients of options, will have voting rights and the right to receive dividends, if any, prior to the time when the restrictions lapse; however, in the sole discretion of the administrator, any dividends will not be released until the restricted stock vests and restrictions are removed or expire. Further, except in connection with a spin-off or other similar event or as otherwise permitted by the Equity Plan, dividends that are paid prior to vesting of restricted stock shall only be paid to the extent that vesting conditions are subsequently satisfied and the restricted stock vests.
Restricted Stock Units:
Restricted stock units (“RSUs”) represent the right to receive, at a specified time or times, a number of shares of our common stock or a cash payment equal to the fair market value of a specified number of shares of our common stock. Restricted stock units will be awarded to any eligible individual selected by the administrator, typically without payment of consideration, but subject to vesting conditions based on continued employment or service or on performance criteria established by the administrator. The administrator may impose restrictions on an awardee’s ability to sell, assign, transfer or pledge the shares underlying RSUs. At the time of grant, the administrator will specify the maturity date for each grant of restricted stock units, which will be no earlier than the vesting date of the award. On the maturity date, the shares underlying the restricted stock units or, in the sole discretion of the administrator, an equivalent amount of cash or a combination of cash and shares, will be transferred to the awardee. Unlike restricted stock, recipients of restricted stock units generally will have no voting or dividend rights prior to the maturity date.
Dividend Equivalents:
Dividend equivalents may be granted by the administrator, either alone or in tandem with another award, based on dividends declared on the shares, to be credited as of dividend payment dates during the period between the date the dividend equivalents are granted to an awardee and the date such dividend equivalents terminate or expire, as determined by the administrator. The Equity Plan provides that dividend equivalents may be settled in cash or shares and at such times as determined by the administrator. Dividend equivalents with respect to any award that are based on dividends paid prior to the vesting of such award will only be paid to the awardee to the extent that the vesting conditions are satisfied and the award vests. No dividend equivalents will be payable with respect to options or SARs.
Other Stock or Cash Based Awards:
The administrator may also grant other stock or cash based awards, including awards entitling an awardee to receive shares or cash to be delivered immediately or in the future, to any eligible individual, including, without limitation, cash payments, cash bonus awards, stock payments, stock bonus awards, performance awards, incentive awards, deferred stock, and deferred stock units. Subject to the terms of the Equity Plan, the administrator will determine the terms and conditions of each such award, including the term of the award, any exercise or purchase price, performance goals, transfer restrictions, vesting conditions and other terms and conditions. Other cash or stock based awards may be paid in cash, shares or a combination of cash and shares, as determined by the administrator, and may be available as a form of payment in the settlement of other awards granted under the Equity Plan, as stand-alone payments, as part of a bonus, deferred bonus, deferred compensation or other arrangement and/or as payment in lieu of compensation to which an eligible individual is otherwise entitled. Except in connection with a spin-off or other similar event or as otherwise permitted by the Equity Plan, dividends that are paid prior to vesting of a stock or cash based award shall only be paid to the extent that the vesting conditions are subsequently satisfied and the other stock or cash based award vests.
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 21 |
Annual Award Limits:
Awards under the Equity Plan will be subject to the following annual limits:
| • | the maximum number of shares with respect to one or more awards that may be granted to any one person during any calendar year shall be 225,000; and |
| • | the maximum aggregate amount that may be paid in cash to any one person in any calendar year with respect to one or more awards payable in cash shall be $8,000,000. |
In addition, the value (determined as of the grant date in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, or any successor thereto) of awards granted to a non-employee director as compensation for services as a non-employee director during any fiscal year of the Company may not exceed $250,000.
Minimum Vesting Period:
The administrator generally has authority to determine the terms and conditions of vesting of awards under the Equity Plan. However, awards granted under the Equity Plan will vest no earlier than the first anniversary of the date the award is granted and no award agreement shall be permitted to reduce or eliminate this requirement; provided, that the administrator may provide that such minimum vesting restrictions may lapse or be waived upon the holder’s termination of service and/or in connection with a change in control and awards that result in the issuance of an aggregate of up to 5% of the Share Limit may be granted to any one or more eligible individuals without respect to this minimum vesting provision. For purposes of awards to non-employee directors, a vesting period will be deemed to be one year if it runs from the date of one annual meeting of the Company’s stockholders to the next annual meeting of the Company’s stockholders, so long as the period between meetings is not less than 50 weeks.
Effects of Change in Control:
In the event of a change in control, the administrator will cause any and all awards outstanding under the Equity Plan to vest and become exercisable and all forfeiture restrictions on any or all of such awards to lapse. Furthermore, upon, or in anticipation of, a change in control, the administrator may cause any and all awards outstanding under the Equity Plan to terminate at a specific time in the future and shall give each awardee the right to exercise such awards during a period of time as the administrator, in its sole and absolute discretion, shall determine.
Prohibition on Repricing Without Stockholder Approval:
We may not, without the approval of our stockholders, (a) authorize the advisory resolutionamendment of any outstanding option or SAR to approve executive compensation.reduce its price per share, or (b) cancel any option or SAR in exchange for cash or another award when the option or SAR price per share exceeds the fair market value of the underlying shares.
The
Awards Subject to Clawback:
Under the Equity Plan, all awards (including any proceeds, gains or other economic benefit actually or constructively received by an awardee upon any receipt or exercise of any award or upon the receipt or resale of any shares underlying any award and any payments of a portion of an incentive-based bonus pool allocated to an awardee) shall be subject to forfeiture and/or repayment to the Company to the extent and in the manner required (a) to comply with any requirements imposed under applicable laws and/or the rules and regulations of the securities exchange or inter-dealer quotation system on which the Common Stock is listed or quoted, including, without limitation, pursuant to Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which we referand (b) under the terms of any policy, guideline or Board committee charter adopted for reasons related to asfraud, governance or similar considerations whether or not such policy or guideline was in place at the Dodd-Frank Act, provides our stockholders withtime of grant of an opportunity to vote on a proposal to approve, on an advisory (non-binding) basis,award.
Miscellaneous Provisions
Adjustment Upon Certain Events:
In the compensationevent of our named executive officers as disclosed in this proxy statement in the Compensation Discussion and Analysis section and the related executive compensation tables. Accordingly, we are asking stockholders to approve, on an advisory (non-binding) basis, the following advisory resolution (the “Advisory Resolution”) at our annual meetingany stock dividend, stock split, combination or exchange of stockholders:
“RESOLVED, that the compensationshares, merger, consolidation or other distribution of the Company’s named executive officers, as disclosedassets to stockholders (other than normal cash dividends) or any other corporate event affecting the shares or the share price other than an equity restructuring that would require adjustments to the Equity Plan or any awards under the Equity Plan in order to prevent the dilution or enlargement of the potential benefits intended to be made available thereunder, the administrator may make equitable adjustments, if any, to reflect such change with respect to (a) the aggregate number and kind of shares that may be issued under the Equity Plan; (b) the maximum aggregate number of shares that may be granted to any one person during any calendar year; (c) the number and kind of shares (or other securities and property) subject to outstanding awards; (d) the terms and conditions of outstanding awards; and (e) the grant or exercise price per share for any outstanding awards.
In addition, in the Annual Proxy Statementevent of any event described above or any unusual or nonrecurring transactions or events affecting the Company or any of its subsidiaries, or the financial statements of the Company or any of its subsidiaries, or of changes in applicable law or applicable accounting standards, the administrator, in its sole discretion, and on such terms and conditions as it deems appropriate, is authorized to provide for the 2023 Annual Meetingtermination, assumption or substitution of Stockholdersan award, to make adjustments in the shares and/or in the terms and conditions of the shares subject to an award, to provide for the early vesting of an award, to replace an award with other rights or property or to provide that an award cannot vest or become payable after such event.
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 22 |
In connection with the occurrence of any equity restructuring that would require adjustments to the Equity Plan or any awards under the Equity Plan in order to prevent the dilution or enlargement of the potential benefits intended to be made available thereunder, the administrator shall make equitable adjustments to the number and type of securities subject to each outstanding award and the exercise price or grant price thereof, as well as certain other equitable adjustments as the administrator deems appropriate, in its sole discretion.
In the event of any pending stock dividend, stock split, combination or exchange of shares, merger, consolidation or other distribution (other than normal cash dividends) of Company assets to stockholders, or any other change affecting the shares or the share price, for reasons of administrative convenience, the administrator, in its sole discretion, may refuse to permit the exercise of any award during a period of up to 30 days prior to the consummation of such transaction.
Transferability of Awards:
Except by will or the laws of descent and distribution or pursuant to beneficiary designation procedures approved from time to time by the administrator or as otherwise provided by the administrator, no award granted under the Equity Plan may be assigned, transferred or otherwise disposed of by the participant, unless and until the award has been exercised or the shares underlying the award have been issued, and all restrictions applicable to the shares have lapsed. For clarity, no award may be transferred to a third party for monetary consideration.
Rights as a Stockholder:
An awardee will not have any rights as a stockholder as to the shares covered by an award until the awardee becomes the record owner of such shares.
At-Will Service:
Nothing in the Equity Plan or in any award agreement will give any awardee under the Equity Plan any right to continue in the employ of our Company or any of our subsidiaries or will interfere with or restrict in any way the rights of any such entity to discharge any awardee at any time.
Data Privacy:
The Equity Plan provides that as a condition of receipt of any award, each awardee explicitly consents to the collection, use and transfer, in electronic or other form, of personal data by and among, as applicable, the Company and our subsidiaries, including any requisite transfer of such data as may be required to a broker or other third party with whom the Company or any of our subsidiaries or the awardee may elect to deposit any shares, to implement, administer and manage the awardee’s participation in the Equity Plan. The Company may also make the data available to public authorities where required under locally applicable law.
Tax Withholding:
We may deduct or withhold, or require the participant to remit to the Company, an amount sufficient to satisfy applicable withholding tax obligations with respect to any taxable event concerning the participant arising as a result of the Equity Plan or any award. The administrator may in its discretion and in satisfaction of the foregoing requirement allow the participant to satisfy such obligations by means of cash or check, shares, broker-assisted cashless exercise or any other form of legal consideration acceptable to the administrator. The administrator may allow the participant to elect to have the Company withhold shares otherwise issuable under any award (or allow the surrender of shares). The number of shares which may be withheld (or surrendered) shall be no greater than the number of shares having a fair market value on the date of withholding equal to the aggregate amount of such liabilities based on the maximum statutory withholding rates in the participant’s applicable jurisdictions for federal, state, local and foreign income and payroll taxes (or such other rate as may be required to avoid adverse accounting consequences).
Amendment and Termination:
The Equity Plan may be amended, modified or terminated by the Board at any time and from time to time; provided that, no amendment, suspension or termination of the Equity Plan shall, without the consent of the awardee, materially and adversely affect any rights or obligations under any award theretofore granted or awarded, unless the award itself otherwise expressly so provides or such action is to comply with the requirements of any applicable claw-back policy or Code Section 409A. Notwithstanding the foregoing, the Equity Plan requires the Company to obtain stockholder approval within twelve (12) months before or after any of the following actions (other than in connection with certain corporate events, as described above):
| • | Increase in the limits imposed on the maximum number of shares available under the Equity Plan; |
| • | Reduction in the price per share of any outstanding option or SAR granted under the Equity Plan; or |
| • | Cancellation of any option or SAR in exchange for cash or another award when the option or SAR price per share exceeds the fair market value of a share. |
In addition, subject to applicable law and as set forth above, the administrator may amend, modify or terminate any outstanding award, including substituting therefor another award of the same or a different type, changing the date of exercise or settlement, and converting an ISO to an NQSO. The awardee’s consent to such action will be required unless (a) the administrator determines that the action, taking into account any related action, would not materially and adversely affect the awardee, or (b) the change is otherwise permitted under the Equity Plan.
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 23 |
Expiration Date: The Equity Plan will expire on, and no award will be granted pursuant to the compensation disclosure rulesEquity Plan after February 9, 2034. Any award that will be outstanding on the expiration date of the Securities and Exchange Commission, includingEquity Plan will remain in force according to the Compensation Discussion and Analysis,terms of the Compensation Tables,Equity Plan and the other related tablesapplicable award agreement.
Federal Income Tax Consequences
This discussion regarding federal tax consequences is intended for the general information of our stockholders, not Equity Plan participants. Alternative minimum tax and disclosure,state and local income taxes are not discussed and may vary depending on individual circumstances and from locality to locality.
Code Section 409A:
Certain awards under the Equity Plan may be considered “nonqualified deferred compensation” subject to Code Section 409A, which imposes additional requirements on the payment of deferred compensation. These requirements generally provide that, if at any time during a taxable year a nonqualified deferred compensation plan fails to meet the requirements of Code Section 409A or is hereby APPROVED.”
The Board of Directors recommends a vote FOR this resolution because it believes thatnot operated in accordance with those requirements, all amounts deferred under the policiesnonqualified deferred compensation plan for the then-current taxable year and practices describedall preceding taxable years, by or for any participant with respect to whom the failure relates, are includible in the Compensation Discussion and Analysis are effective in achieving the Company’s goals of attracting, retaining and motivating our executives, rewarding individual and Company performance and aligning the executives’ long-term interests with thosegross income of the stockholders.
We encourage stockholdersparticipant for the taxable year to read the Compensation Discussionextent not subject to a substantial risk of forfeiture and Analysis beginning on page 28 of this proxy statement,not previously included in gross income. If a deferred amount is required to be included in income under Code Section 409A, the amount will be subject to income tax at regular income tax rates plus a 20 percent penalty, as well as potential premium interest tax.
Federal Tax Treatment of Award Types:
Nonqualified Stock Options. An awardee of nonqualified stock options does not realize taxable income upon receiving an option, nor are we entitled to any deduction at the Compensation Tablestime of grant. Upon exercise of a nonqualified stock option, the optionee realizes ordinary income, and related narrative, appearing on pages 34 through 42, which provide detailed informationwe are entitled to a deduction, in an amount equal to the difference between the option’s exercise price and the fair market value of the stock on the Company’s compensation policiesdate of exercise. An optionee’s basis for the stock for the purpose of determining gain or loss on the subsequent disposition of the shares is the fair market value of the stock on the date of exercise.
Incentive Stock Options. There is no taxable income to an awardee of ISOs either at the time of grant or upon exercise; however, the amount by which the fair market value of the shares at the time of exercise exceeds the option price is an “‘item of tax preference’” for the optionee. Gain realized by an optionee upon sale of stock issued on exercise of an ISO is taxable at capital gains rates, and practicesno tax deduction is available to us unless the optionee disposes of the shares within two years after the date of grant or within one year of the date the shares were transferred to the optionee. In that event, the difference between the option exercise price and the compensationfair market value of our named executive officers.
This “say-on-pay” vote is a non-binding advisory vote. The approval or disapproval of this proposal by stockholders will not require the Board of Directors or the Compensation Committee to take any action regarding our executive compensation practices. The final decisionshares on the compensationdate of the exercise is taxed at ordinary income rates, and benefits of our named executive officers and on whether, and if so, how,we are entitled to address stockholder disapproval of this proposal remainsa deduction to the extent the employee must recognize ordinary income. An ISO that is exercised more than three months after retirement is taxed as a nonqualified stock option, with the Boardoptionee deemed to have received income upon the exercise taxable at ordinary income rates. We are entitled to a tax deduction equal to the ordinary income, if any, realized by the optionee.
Stock Appreciation Rights. An awardee of Directors and the Compensation Committee.
Unless the Board of Directors modifies its determination on the frequency of future “say-on-pay” advisory votes, the next “say-on-pay” advisory vote will be heldSARs realizes no taxable income at the 2026 annual meetingtime of stockholders.receipt. Upon exercise, the fair market value of the shares (or cash in lieu of shares) received is taxable as ordinary income. We are entitled to a deduction in the same amount that the awardee realizes as ordinary income.
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 20
BackRestricted Stock. Unless an election is made under Section 83(b) of the Code, an awardee of restricted stock does not have taxable income upon receipt of restricted stock and we are not entitled to Contents
Item 4. Advisory (Non-Binding) Vote ona deduction upon issuance. However, when the Frequencyrestrictions lapse such that the shares are no longer subject to forfeiture or, if applicable, repurchased by us, the recipient realizes ordinary income, and we are entitled to a deduction, in an amount equal to the fair market value of Future Advisory Votesthe shares at the date the restrictions lapse, less the purchase price thereof. If an election is made under Section 83(b), the awardee realizes ordinary income at the date of issuance equal to Approve Executive Compensation Every 1, 2the difference between the fair market value of the shares at that date less the purchase price thereof and we are entitled to a deduction in the same amount.Restricted Stock Units. An awardee of RSUs does not realize taxable income until he or 3 Years
The Board of Directors recommends that you vote for conducting future advisory votes to approve executive compensation EVERY THREE YEARS.
The Dodd-Frank Act also provides our stockholders with an opportunity to vote on a proposal, on an advisory (non-binding) basis, regarding how frequently we should seek an advisory vote to approve the compensation of our named executive officers, as disclosedshe receives stock or cash pursuant to the Securities and Exchange Commission’s compensation disclosure rules, such as Item 3 above. In this Item 4,award, at which time the awardee realizes ordinary income equal to the full fair market value of the shares delivered or the amount of cash paid. At that time, we are asking stockholdersallowed a deduction equal to votethe compensation taxable to the recipient, subject to Code restrictions.
Dividend Equivalents. An awardee of dividend equivalents does not realize taxable income at the time of grant, and we are not entitled to a deduction at that time. When a dividend equivalent is paid, the awardee recognizes ordinary income and we are entitled to a corresponding deduction.
Other Stock or Cash Based Award. The tax consequences associated with any other stock and cash based award granted under the Equity Plan will vary depending on the specific terms of such award. Among the relevant factors are whether future advisory votesor not the award has a readily ascertainable fair market value, whether or not the award is subject to forfeiture provisions or restrictions on executivetransfer, the nature of the property received or to be received by the participant under the award and the participant’s holding period and tax basis for the award or underlying common shares (if any). Other stock or cash based awards under the Equity Plan may include, without limitation, deferred stock and deferred stock units, the federal tax treatment of which is described below.
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 24 |
| • | Deferred stock - An awardee of deferred stock generally does not have taxable income upon receipt of deferred stock nor are we entitled to a deduction upon issuance. When the deferred stock vests and is issued to the awardee, the awardee realizes ordinary income and we are entitled to a deduction in an amount equal to the difference between the fair market value of the shares at the date of issuance over the purchase price, if any, for the deferred stock. Deferred stock may be subject to Code Section 409A, and the failure of any award of deferred stock that is subject to Code Section 409A to comply therewith may result in taxable income to the awardee upon the grant or vesting of the award, as well as interest and penalties. |
| • | Deferred stock units (“DSUs”) - An awardee of DSUs generally does not have taxable income upon receipt of DSUs nor are we entitled to a deduction upon issuance. When the shares underlying the DSUs are issued to the awardee (or payment is made equal to the fair market value of such shares), the awardee generally realizes ordinary income and we are entitled to a deduction in an amount equal to the difference between the fair market value of the shares at the date of issuance (or the amount of payment) over the DSUs. DSUs may be subject to Code Section 409A, and the failure of any award of DSUs to comply therewith may result in taxable income to the awardee upon the grant or vesting of the award, as well as interest and penalties. |
New Plan Benefits:
Other than pursuant to the terms of the Company’s director compensation (similarpolicy, no determination has been made as to Item 3) should occur every year, every two yearsthe types or every three years. Stockholdersamounts of awards that will be ablegranted in the future pursuant to specify one of four choices for this proposal on the proxy card: one year, two years, three years or abstain. Stockholders areEquity Plan. It is therefore not votingpossible to approve or disapprovedetermine the Board’s recommendation. This advisory vote onfuture benefits that will be received by participants other than pursuant to the frequency of future advisory votes on executivedirector compensation is non-bindingpolicy.
| Name and Position | | Dollar Value of RSUs
($)(1) | | Number of Shares
(#) |
| Named Executive Officers: | | | | |
| Norman Schwartz | | — | | — |
| President, Chief Executive Officer and Chairman of the Board | | | | |
| Ilan Daskal(3) | | — | | — |
| Former Executive Vice President and Chief Financial Officer | | | | |
| Andrew J. Last | | — | | — |
| Executive Vice President, Chief Operating Officer | | | | |
| Dara Grantham Wright(4) | | — | | — |
| Executive Vice President and President, Clinical Diagnostics Group | | | | |
| Simon May | | — | | — |
| Executive Vice President and President, Life Science Group | | | | |
| Executive Group | | — | | — |
| Non-Executive Director Group | | $400,000 | | (2) |
| Non-Executive Officer Employee Group | | — | | — |
| (1) | The new director compensation policy approved October 2023 provides that if the stockholders approve the amendment of the 2017 Incentive Award Plan to allow equity grants to non-employee directors, then starting in 2024, the $300,000 Board Member retention fee will be split, with $200,000 payable in cash and $100,000 in equity grants of restricted stock units with a 4-year vesting cycle. |
| (2) | The aggregate number of shares to be granted to non-employee directors is not included in the table above as the number of shares will be determined based on a fair market value determination as of the grant date. |
| (3) | Mr. Daskal resigned from his position as Executive Vice President and Chief Financial Officer effective as of the close of business on November 6, 2023 and did not receive any cash severance, vesting acceleration or other benefits in connection with his resignation. |
| (4) | Ms. Grantham Wright resigned from her position as Executive Vice President and President, Clinical Diagnostics Group effective as of the close of business on January 12, 2024 and did not receive any cash severance, vesting acceleration or other benefits in connection with her resignation. |
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 25 |
Historical Grants Under the Board.Equity Plan:
The Board understands that there are different views asfollowing table provides summary information regarding the number of shares of our Class A and Class B Common Stock subject to what is an appropriate frequency for advisory votes on executive compensation. After careful consideration of this proposal, our Board of Directors has determined that an advisory vote on executive compensation that occurs every THREE YEARS isawards granted under the most appropriate alternative forEquity Plan to certain persons since the Company, and therefore our Board of Directors recommends that you vote for a three-year interval for the advisory vote on executive compensation.Equity Plan’s initial effective date through February 26, 2024.
With respect to this item, if none of the frequency alternatives (one year, two years or three years) receives
| Name | | Number of
Shares Underlying
Stock Options
(#) | | Number of Shares
Underlying RSUs
(#) | | Number of Shares
Underlying PSUs
(#)(1) |
| Named Executive Officers: | | | | | | |
| Norman Schwartz | | 49,881 | | 70,227 | | 6,783 |
| Ilan Daskal | | 7,489 | | 14,272 | | 2,262 |
| Andrew J. Last | | 11,142 | | 19,619 | | 2,826 |
| Dara Grantham Wright | | 5,865 | | 10,952 | | 1,696 |
| Simon May | | — | | 16,839 | | 1,696 |
| All current executive officers as a group (7 persons) | | 85,395 | | 155,577 | | 15,263 |
| All current directors who are not executive officers as a group | | — | | 1,850 | | — |
| Each director nominee (who is not a named executive officer) | | | | | | |
| Jeffrey L. Edwards | | — | | — | | — |
| Gregory K. Hinckley | | — | | — | | — |
| Melinda Litherland | | — | | — | | — |
| Arnold A. Pinkston | | — | | — | | — |
| Allison Schwartz | | — | | 1,850 | | — |
| Each associate of any such executive officer, director or director nominee | | — | | — | | — |
| Each other person who received or is to receive 5% of awards under the plan | | — | | — | | — |
| All current employees who are not executive officers as a group | | — | | 553,702 | | 6,774 |
| (1) | For PSUs, the number of shares is calculated assuming “target” performance. |
Vote Required:
The amended Bio-Rad Laboratories, Inc. 2017 Incentive Award Plan must receive the affirmative vote of a majority of our Voting Power we will considerpresent or represented by proxy at the frequency that receives the highest number of votes by our Voting Powermeeting and entitled to vote on such matter in order for it to be the frequency that has been selected by our stockholders. However, because this vote is advisory and not binding on us or our Board of Directors in any way, our Board of Directors may decide that it is in our and our stockholders’ best interests to hold an advisory vote on executive compensation more or less frequently than the option approved by our stockholders.
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 21
Back to Contents
Item 5. Stockholder Proposal: Political Disclosure
The Board of Directors recommends that you vote AGAINST this Stockholder Proposal: Political Disclosure.
James McRitchie and Myra K. Young, 9295 Yorkship Court, Elk Grove, CA 95758, beneficial owners of 25 shares of Bio-Rad common stock, have notified Bio-Rad that their designee, John Chevedden, intends to present the following proposal for consideration at the annual meeting. In accordance with the applicable proxy regulations, the text of the stockholder proposal, supporting statement and any graphics are set forth immediately below.
Bio-Rad is not responsible for the content of this stockholder proposal or the accuracy of the supporting statement.
StockholderProposal:
Proposal5–PoliticalDisclosure
Resolved:James McRitchie, of CorpGov.net, requests Bio-Rad Laboratories Inc. (“Bio-Rad” or “Company”) provide a report, updated semiannually, disclosing Bio-Rad’s:
1.
Policies and procedures for making, with corporate funds or assets, contributions and expenditures (direct or indirect) to (a) participate or intervene in any campaign on behalf of (or in opposition to) any candidate for public office, or (b) influence the general public, or any segment thereof, with respect to an election or referendum.
2.
Monetary and non-monetary contributions and expenditures (direct and indirect) used in the manner described in section 1 above, including:
a.
The identity of the recipient as well as the amount paid to each; and
b.
The title(s) of the person(s) in the Company responsible for decision-making.
The report shall be presented to the board of directors or relevant board committee and posted on Bio-Rad’s website within 12 months after the annual meeting. This proposal does not encompass lobbying spending.
SupportingStatement: As long-term shareholders of Bio-Rad, we support transparency and accountability in corporate electoral spending. This includes any activity considered intervention in a political campaign under the Internal Revenue Code, such as direct and indirect contributions to political candidates, parties, or organizations, and independent expenditures or electioneering communications on behalf of federal, state, or local candidates.
Political spending can adversely impact a company’s reputation, value, and bottom line. The risk is especially serious when involving trade associations, Super PACs, 527 committees, and “social welfare” organizations – groups that routinely pass money to or spend on behalf of candidates and political causes companies might not otherwise support.
The Conference Board’s “Under a Microscope”(1) details these risks, recommends the process suggested in this proposal, and warns:
a new era of stakeholder scrutiny, social media, and political polarization has propelled corporate political activity—and the risks that come with it—into the spotlight. Political activity can pose increasingly significant risks for companies, including the perception that political contributions—and other forms of activity—are at odds with core company values.
We ask Bio-Rad to disclose all its electoral spending, including payments to trade associations and other tax-exempt organizations, which may be used for electoral purposes–and are otherwise undisclosed. This would bring our Company in line with leading companies, including Becton, Dickinson and Company, Bristol-Myers Squibb Company, and Boston Scientific Corp.
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 22
Back to Contents
Without knowing the recipients of Bio-Rad’s political dollars, we cannot assess alignment with its policies on climate change and sustainability or other areas of concern. Bio-Rad is a controlled company with a dual-class structure. It is, therefore, even more critical that the Board hear from independent shareholders on this issue to avoid groupthink and risk. Bio-Rad ranks in the bottom tier for 2022 CPA-Zicklin Index disclosure(2).
(1) https://www.conference-board.org/publications/
(2) https://www.politicalaccountability.net/wp-content/uploads/2022/10/2022-CPA-Zicklin-Index.pdf
EnhanceShareholderValue,VoteFORPoliticalDisclosure–Proposal5approved.
Board’sStatementinOpposition:
Bio-Rad’s Code of Business Ethics and Conduct prohibits use of the “company’s time, funds, or other resources to advance or support any political cause or candidate.” Pursuant to these principles, the Company does not intend to make any monetary or non-monetary contributions or expenditures to participate in or intervene in any political campaigns, elections or referendums. Accordingly, the Board of Directors believes that the report described in the stockholder proposal is unnecessary and recommends that you vote AGAINST the stockholder proposal.
TheBoardofDirectorsrecommendsthatyouvoteAGAINSTthisstockholderproposal.
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 23
Back to Contents
Executive| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 26 |
Executive Officers
Executive officers of Bio-Rad during the period between January 2022 andas of the date of this proxy statement are listed in the table below.
Name | Position with Bio-Rad | Age |
Norman Schwartz | President, Chief Executive Officer and Chairman of the Board | 73
74 |
Colleen Corey | Executive Vice President, Global Human Resources | 62 |
| Michael Crowley | Executive Vice President, Global Commercial Operations | 61
62 |
Diane Dahowski
Sedat Evran | Executive Vice President, Global Supply Chain | 61
52 |
Ilan Daskal
| Executive Vice President and Chief Financial Officer
| 57
|
Timothy S. Ernst
| Executive Vice President, General Counsel and Secretary
| 63
|
Dara Grantham Wright
| Executive Vice President and President, Clinical Diagnostics Group
| 47
|
Andrew J. Last | Executive Vice President and Chief Operating Officer | 63
64 |
Simon May | Executive Vice President and President, Life Science Group | 51
52 |
Biographical information regardingfor Norman Schwartz is provided in the preceding pages. Biographical information regarding Michael Crowley, Diane Dahowski, Ilan Daskal, Timothy S. Ernst, Dara Grantham Wright, Andrew J. Last, and Simon May,for our other executive officers is set forth below. Our executive officers also serve in various management capacities with our wholly owned subsidiaries.
❯
COLLEEN COREY
Colleen Corey was appointed Executive Vice President, Global Human Resources in August 2019. Previously, she was appointed Senior Vice President, Global Human Resources in September 2014. Prior to that appointment, Ms. Corey held various roles of increasing responsibility in Human Resources since joining Bio-Rad in 1996.
Michael Crowley was appointed Executive Vice President, Global Commercial Operations in December 2014. Previously he was Vice President, Commercial Manager, Europe from 2012 to 2014 and Commercial Manager, Clinical Diagnostics Group, Europe from 2011 to 2012 and Division Manager of the Clinical Diagnostics Group North American Sales Organization from 2008 to 2011. Prior to that, he was the Clinical Diagnostics U.S. National Sales Manager since joining Bio-Rad in 1998.
❯DIANE DAHOWSKISEDAT EVRAN
Diane Dahowski
Sedat Evran was appointed Executive Vice President, Global Supply Chain in February 2020. Previously she was Senior Vice President, Global Technology & Systems from 2014 to 2020, and SVP, Clinical Diagnostics Group U.S. Operations from 2008 to 2014. Prior to that she held various positions within Bio-Rad since joining us in 1988, including VP, Clinical Immunology Division, VP Clinical Systems Division, and VP, North America Commercial Operations.
Ilan Daskal was appointed Executive Vice President and Chief Financial Officer in April 2019.September 2023. Prior to joining Bio-Rad, Mr. Daskal,Evran was the Chief Financial Officer of Lumileds,Vice President, Global Operations and Supply Chain at Danaher Corporation, a global leader in advanced lighting technology,life sciences and diagnostics innovator, from May 20172020 to January 2019. From 2015 through 2016, Mr. Daskal held multiple short-term Chief Financial Officer roles with private2023, and public companies including Aricent Inc., a global design and engineering company, Cepheid, a molecular diagnostic company, and SunEdison Inc., a renewable energy company. Prior to that, from 2008 to 2015, Mr. Daskal was the Executive Vice President, Operations and Chief Financial Officer at International Rectifier Corporation, a leader in power management semi-conductor technology that was publicly traded until it was acquired by Infineon Technologies in 2015.
Timothy S. Ernst was appointed Executive Vice President, General Counsel and Secretary in June 2016. Previously he was Senior Vice President, General Counsel and Secretary of Big Heart Pet Brands, a manufacturer and marketer of branded pet food products,Supply Chain Seed from 20142019 to 2015.2020. Prior to that, he was the Senior Vice-President, General Counsel and Secretary of Del Monte Foods, a manufacturer and marketer of consumer food products, from 2012 to 2014, and Associate General Counsel and Assistant Secretary of Del Monte Foods from 1995 to 2012. He was the Associate General Counsel of California and Hawaiian Sugar Company, a refiner and marketer of sugar and sugar products, from 1990 to 1995. He is a member of the California Bar and Association of Corporate Counsel.
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 24
Back to Contents
Dara Grantham Wright was appointed Executive Vice President, President, Clinical Diagnostics Group in January 2020. PriorGlobal Operations at Perkin Elmer, a global analytical services and solutions provider, from 2015 to joining Bio-Rad,2019. Mr. Evran held supply chain leadership roles at Hil-Rom from 20162011 to November 2019 Ms. Grantham Wright was Vice President2015, and at GE Healthcare and General Manager, Biosciences Division, Life Science Solutions Group, Protein & Cell Analysis at Thermo Fisher Scientific Inc., a biotechnology product development company. From 2014Electric Medical Systems from 2001 to 2016, Ms. Grantham Wright was Senior Vice President & General Manager, eBioscience Business Unit at Affymetrix, Inc., a manufacturer of DNA microarrays that was acquired by Thermo Fisher Scientific in 2016. Prior to that, from 2013 to 2014, she was Chief Commercial Officer at Boreal Genomics, Inc., a company that develops new technologies for blood-based detection and monitoring of circulating tumor DNA. From 2010 to 2013 she was Global Vice President of Strategic Marketing and Clinical Applications at Affymetrix, Inc.2011.
❯ANDREW J. LAST
Andrew J. Last was appointed Executive Vice President and Chief Operating Officer in April 2019. Prior to joining Bio-Rad, Dr. Last was the Chief Commercial Officer of Berkeley Lights, Inc., a digital cell biology company that develops and commercializes platforms for the acceleration of discovery, development and delivery of cell-based products and therapies, from December 2017 to April 2019. From 2016 through 2017, Dr. Last was the Chief Operating Officer of Intrexon Corporation, a publicly traded biotechnology company. Prior to that, from 2010 to 2016, Dr. Last held senior roles at Affymetrix, Inc., a company that manufactures DNA microarray solutions, including most recently the role of Executive Vice President and Chief Operating Officer. Dr. Last’s other previous global leadership roles have included senior positions with Becton, Dickinson and Company from 2004 to 2010; Applied Biosystems from 2002 to 2004; Incyte Genomics from 1999 to 2002; and Monsanto Company from 1987 to 1999. Dr. Last also currently serves on the Board of Directors of OncoCyte Corporation, a publicly traded molecular diagnostics company.
❯SIMON MAY
Simon May was appointed Executive Vice President, President, Life Science Group in January 2022. Previously Dr. May was Senior Vice President and General Manager of the Digital Biology Group from 2020 to 2022, Senior Vice President, Commercial Manager from 2015 to 2020, and Vice President, North American Sales from 2014 to 2015. Prior to joining Bio-Rad in 2014, Dr. May held various leadership roles in sales and product/portfolio management at Thermo Fisher Scientific Inc., a biotechnology product development company, from 2004 to 2014. He holds a PhD in Molecular Biology and acquired hands-on expertise in molecular biology and tissue culture techniques as a Postdoctoral Research Fellow at the University of Liverpool.
Our executive officers also serve in various management capacities with our wholly owned subsidiaries.
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 27 |
25
Back to Contents
Principal and Management Stockholders
The following table presents certain information as of February 24, 202326, 2024 (except as noted below), with respect to our Class A Common Stock and Class B Common Stock beneficially owned by: (i) any person who is known to us to be the beneficial owner of more than five percent of the outstanding Common Stock of either class, (ii) each of our directors and our director nominees, (iii) certain of our executive officers named in the “Summary Compensation Table” of this proxy statement and (iv) all of our directors and executive officers as a group.group as of the date of this proxy statement. The address for all executive officers and directors is c/o Bio-Rad Laboratories, Inc., 1000 Alfred Nobel Drive, Hercules, California, 94547.
Name and, with Respect to Owner of 5% or More, Address | Class A Common Stock(1) | | Class B Common Stock | |
Number of Shares and Nature of Ownership(2) | Percent
of Class | Number of Shares and Nature of Ownership(2) | Percent
of Class |
Blue Raven Partners, L.P.(3) 1000 Alfred Nobel Drive
Hercules, CA 94547 | — | 0.0 | % | 4,060,054 | 80.0 | % |
The Vanguard Group(4) 100 Vanguard Blvd.
Malvern, PA 19355 | 2,391,436 | 9.8 | % | — | 0.0 | % |
Blackrock, Inc.(5) 55 East 52nd Street
New York, NY 10055 | 1,582,313 | 6.5 | % | — | 0.0 | % |
Alice N. Schwartz(6)(7)(8)(9) Bio-Rad Laboratories, Inc. 1000 Alfred
Nobel Drive Hercules, CA 94547 | 2,734,673 | 11.2 | % | 4,555,200 | 89.8 | % |
Norman Schwartz(6)(8)(9)(10)(11) Bio-Rad Laboratories, Inc.
1000 Alfred Nobel Drive
Hercules, CA 94547 | 476,362 | 1.9 | % | 4,509,643 | 87.1 | % |
Steven Schwartz(6)(8)(9)(12) Bio-Rad Laboratories, Inc.
1000 Alfred Nobel Drive
Hercules, CA 94547 | 377,249 | 1.5 | % | 4,098,082 | 80.8 | % |
Jeffrey L. Edwards | — | 0.0 | % | — | 0.0 | % |
Gregory K. Hinckley | 500 | 0.0 | % | — | 0.0 | % |
Melinda Litherland | — | 0.0 | % | — | 0.0 | % |
Arnold A. Pinkston | — | 0.0 | % | — | 0.0 | % |
Allison Schwartz(8)(9) | 14,312 | 0.1 | % | 3,890 | 0.1 | % |
Ilan Daskal(10) | 4,133 | 0.0 | % | — | 0.0 | % |
Dara Grantham Wright(10) | 4,553 | 0.0 | % | — | 0.0 | % |
Andrew J. Last(10) | 6,550 | 0.0 | % | — | 0.0 | % |
Simon May(10) | 1,582 | 0.0 | % | — | 0.0 | % |
All directors and executive officers as a group(10)(13) (13 persons) | 535,209 | 2.2 | % | 4,513,533 | 87.1 | % |
(1) Excludes Class A Common Stock that may be acquired on conversion of Class B Common Stock. Class B Common Stock may be converted to Class A Common Stock on a one for one basis and, if fully converted, would result in the following percentage beneficial ownership of Class A Common Stock: Blue Raven Partners. L.P. 13.7%; The Vanguard Group, 8.1%; BlackRock, Inc. 5.3%; Alice N. Schwartz 24.6%; Norman Schwartz 16.8%; Steven Schwartz 15.1%; Allison Schwartz 0.1%; and all directors and executive officers as a group 17.0%. Management considers any substantial conversions by the executive officers or directors listed in the table to be highly unlikely. (2) Except as otherwise indicated and subject to applicable community property and similar statutes, the persons listed as beneficial owners of the shares have sole voting and investment power with respect to such shares. Number of shares is based on the statements of the stockholders where not identified specifically in the stockholder register. (3) Alice N. Schwartz, Norman Schwartz and Steven Schwartz are general partners of Blue Raven Partners, L.P., a California limited partnership, and, as such, share voting and dispositive power over the Class B Common Stock held by Blue Raven Partners. (4) Based solely on a Schedule 13G/A filed on February 9, 2023 with the Securities and Exchange Commission pursuant to Rule 13d-1(b) of the Exchange Act. (5) Based solely on a Schedule 13G/A filed on February 1, 2023 with the Securities and Exchange Commission pursuant to Rule 13d-1(b) of the Exchange Act. |
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 26
Back As described in the notes to Contentsthe table, certain named beneficial owners share voting and/or investment power with respect to certain shares of Common Stock. Consequently, such shares are shown as beneficially owned by more than one person.
| | Class A Common Stock(1) | | Class B Common Stock | | |
Name and, with Respect to
Owner of 5% or More, Address | | Number of Shares and
Nature of Ownership(2) | | Percent
of Class | | Number of Shares and
Nature of Ownership(2) | | Percent
of Class | | Voting Power
Percent^ |
Blue Raven Partners, L.P.(3)
1000 Alfred Nobel Drive
Hercules, CA 94547 | | — | | 0.0% | | 4,060,054 | | 79.7% | | 54.6% |
The Vanguard Group(4)
100 Vanguard Blvd.
Malvern, PA 19355 | | 2,389,889 | | 10.2% | | — | | 0.0% | | 3.2% |
Blackrock, Inc.(5)
50 Hudson Yards
New York, NY 10001 | | 1,466,226 | | 6.3% | | — | | 0.0% | | 2.0% |
Alice N. Schwartz(6)(7)(8)(9)
Bio-Rad Laboratories, Inc.
1000 Alfred Nobel Drive
Hercules, CA 94547 | | 2,733,473 | | 11.7% | | 4,554,906 | | 89.4% | | 64.9% |
Norman Schwartz(6)(8)(9)(10)(11)
Bio-Rad Laboratories, Inc.
1000 Alfred Nobel Drive
Hercules, CA 94547 | | 491,499 | | 2.1% | | 4,434,412 | | 87.0% | | 60.2% |
Steven Schwartz(6)(8)(9)(12)
Bio-Rad Laboratories, Inc.
1000 Alfred Nobel Drive
Hercules, CA 94547 | | 379,319 | | 1.6% | | 4,098,180 | | 80.4% | | 55.6% |
| Jeffrey L. Edwards | | — | | 0.0% | | — | | 0.0% | | 0.0% |
| Gregory K. Hinckley | | 500 | | 0.0% | | — | | 0.0% | | 0.0% |
| Melinda Litherland | | — | | 0.0% | | — | | 0.0% | | 0.0% |
| Arnold A. Pinkston | | — | | 0.0% | | — | | 0.0% | | 0.0% |
| Allison Schwartz(8)(9) | | 16,531 | | 0.1% | | 3,939 | | 0.1% | | 0.1% |
| Ilan Daskal(10) | | 2,486 | | 0.0% | | — | | 0.0% | | 0.0% |
| Dara Grantham Wright(10) | | 1,838 | | 0.0% | | — | | 0.0% | | 0.0% |
| Andrew J. Last(10) | | 12,050 | | 0.1% | | — | | 0.0% | | 0.0% |
| Simon May(10) | | 3,148 | | 0.0% | | — | | 0.0% | | 0.0% |
| All directors and executive officers as a group(10)(13) (13 persons) | | 551,897 | | 2.3% | | 4,438,351 | | 87.1% | | 60.3% |
| ^ | Voting Power represents combined voting power of Class A Common Stock (one-tenth of a vote) and Class B Common Stock (one vote) owned beneficially as of February 26, 2024. |
| (1) | Excludes Class A Common Stock that may be acquired on conversion of Class B Common Stock. Class B Common Stock may be converted to Class A Common Stock on a one for one basis and, if fully converted, would result in the following percentage beneficial ownership of Class A Common Stock: Blue Raven Partners. L.P. 14.2%; The Vanguard Group, 8.4%; BlackRock, Inc. 5.1%; Alice N. Schwartz 25.6%; Norman Schwartz 17.2%; Steven Schwartz 15.7%; Allison Schwartz 0.1%; and all directors and executive officers as a group 17.5%. Management considers any substantial conversions by the executive officers or directors listed in the table to be highly unlikely. |
| (2) | Except as otherwise indicated and subject to applicable community property and similar statutes, the persons listed as beneficial owners of the shares have sole voting and investment power with respect to such shares. Number of shares is based on the statements of the stockholders where not identified specifically in the stockholder register. |
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 28 |
| (3) | Alice N. Schwartz, Norman Schwartz and Steven Schwartz are general partners of Blue Raven Partners, L.P., a California limited partnership, and, as such, share voting and dispositive power over the Class B Common Stock held by Blue Raven Partners. |
| (4) | Based solely on a Schedule 13G/A filed on February 13, 2024 with the Securities and Exchange Commission pursuant to Rule 13d-1(b) of the Exchange Act. |
| (5) | Based solely on a Schedule 13G/A filed on January 29, 2024 with the Securities and Exchange Commission pursuant to Rule 13d-1(b) of the Exchange Act. |
| (6) | Includes 4,060,054 shares of Class B Common Stock held by Blue Raven Partners, L.P. |
| (7) | Includes 2,721,3882,718,118 shares of Class A Common Stock and 495,146494,852 shares of Class B Common Stock, which are held in the following trusts, all of which Alice N. Schwartz is the sole trustee: the David and Alice N. Schwartz Charitable Remainder Unitrust (34,311 shares of Class A Common Stock); the David Schwartz Exemption Trust (90 shares of Class A Common Stock); the David Schwartz Exempt Marital Trust (240 shares of Class A Common Stock); the David Schwartz Non-Exempt Marital Trust (898,931 shares of Class A Common Stock and 57,000 shares of Class B Common Stock); the Alice N. Schwartz Revocable Trust (1,787,816(1,784,546 shares of Class A Common Stock and 438,146437,852 shares of Class B Common Stock). |
| (8) | Includes 13,28515,355 shares of Class A Common Stock held by Alles Institute for Medical Research, a Delaware Charitable Nonstock Corporation, with respect to which Alice N. Schwartz, Norman Schwartz, Steven Schwartz and Allison Schwartz each have voting power and dispositive power consistent with the purposes of the Delaware Charitable Nonstock Corporation. |
| (9) | Norman Schwartz and Steven Schwartz are sons of Alice N. Schwartz. Norman Schwartz is the father of Allison Schwartz. |
| (10) | Includes shares with respect to which such persons have the right to acquire beneficial ownership immediately or within sixty days of February 24, 202326, 2024 under the Company’s employee stock purchase plan, restricted stock unit agreements and stock option agreements, as follows: Norman Schwartz, 35,23343,224 Class A shares and 105,000 Class B shares; Ilan Daskal, 3,1350 Class A shares; Dara Grantham Wright, 2,7910 Class A shares; Andrew J. Last, 3,4587,001 Class A shares; Simon May, 3243 Class A shares; and all directors and officers as a group, 64,80965,234 Class A shares and 105,000 Class B shares. |
| (11) | Includes 12,90012,949 shares of Class B Common Stock owned by Norman Schwartz’s wife, as to which Norman Schwartz disclaims any beneficial ownership. |
| (12) | Includes 1,818 shares of Class A Common Stock and 12,90012,949 shares of Class B Common Stock owned by Steven Schwartz’s wife, as to which Steven Schwartz disclaims any beneficial ownership. |
| (13) | As a Director Emeritus, Alice N. Schwartz is not included in “All directors and executive officers as a group.” |
Compensation Committee Report
The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis with management, including the Company’s Chairman and President and Chief Executive Officer. Based on the review and discussions referred to above, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in the annual reportAnnual Report on Form 10-K for the fiscal year ended December 31, 20222023 and this proxy statement.
| | THE COMPENSATION COMMITTEE Jeffrey L. Edwards
Gregory K. Hinckley
|
| | |
| Jeffrey L. Edwards |
| Gregory K. Hinckley |
The Compensation Committee report shall not be deemed “soliciting material” or incorporated by reference by any general statement incorporating by reference this proxy statement into any filing under the Securities Act or the Exchange Act and shall not otherwise be deemed filed under these Acts.
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 27
Back to Contents
Compensation| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 29 |
Compensation Discussion and Analysis
In this Compensation Discussion and Analysis, we review the objectives and elements of our execution compensation program and discuss the 20222023 compensation earned by our named executive officers, or NEOs.
For 2022,2023, our named executive officers were:
Name | | Position |
Norman Schwartz | | President, Chief Executive Officer and Chairman of the Board |
Ilan Daskal (1) | | Former Executive Vice President and Chief Financial Officer |
Andrew J. Last | | Executive Vice President Chief Operating Officer |
Dara Grantham Wright (2) | | Executive Vice President and President, Clinical Diagnostics Group |
Simon May | | Executive Vice President and President, Life Science Group |
| (1) | Mr. Daskal resigned from his position as Executive Vice President and Chief Financial Officer effective as of the close of business on November 6, 2023 and did not receive any cash severance, vesting acceleration or other benefits in connection with his resignation. |
| (2) | Ms. Grantham Wright resigned from her position as Executive Vice President and President, Clinical Diagnostics Group effective as of the close of business on January 12, 2024 and did not receive any cash severance, vesting acceleration or other benefits in connection with her resignation. |
COMPENSATION PROGRAM OBJECTIVES AND PHILOSOPHY
We maintain various compensation programs for our named executive officers. Our executive compensation program, taken as a whole, has several objectives. The overriding objective of our executive compensation program is to attract, retain, motivate and develop the type of executives who will establish and execute strategic initiatives that help us to continue to grow a profitable business. We also want our executive compensation program to help align the interests of the executives with the interests of the Company and its stockholders. Finally, we want to reward our executives for business achievements and satisfaction of corporate objectives without creating risks which could have a material adverse effect on the Company.
In developing our overall executive compensation program and in setting individual pay levels for the named executive officers, we strive to meet the following goals:
•
To pay salaries that are competitive in our industry and our geographical market.
•
| • | To pay salaries that are competitive in our industry and our geographical market. |
| • | To use executive pay practices that are commonly found in our industry, as appropriate. |
| • | To pay salaries and award merit increases on the basis of the individual executive’s performance and contributions and the value of the executive’s position within our organization. |
| • | To maintain a “pay for performance” outlook, particularly in our incentive programs. |
| • | To manage risk taking by incorporating objective company performance goals into our incentive programs. |
To use executive pay practices that are commonly found in our industry, as appropriate.
•
To pay salaries and award merit increases on the basis of the individual executive’s performance and contributions and the value of the executive’s position within our organization.
•
To maintain a “pay for performance” outlook, particularly in our incentive programs.
•
To manage risk taking by incorporating objective company performance goals into our incentive programs.
Our executive compensation program is designed to reward our executives for Company and individual performance. Because we feel that each of our named executive officers provides unique services to us, we do not use a fixed relationship between base pay, annual performance-based cash bonus payments and equity awards. When we make our final decisions about a named executive officer’s total compensation package for a year, we look at the three primary elements of compensation (base pay, potential performance-based bonus payments and long-term equity awards) individually and as a complete package. Overall, we believe that our total compensation program for executives is reasonable while being competitive within the market in which we compete for executive talent and does not create risks that are reasonably likely to have a material adverse effect on the Company.
STOCKHOLDER SAY-ON-PAY VOTE
At our 20202023 meeting of stockholders, we provided our stockholders with the opportunity to cast an advisory vote on executive compensation. 97%96% of the shares represented in attendance or by proxy and entitled to vote on this “2020“2023 say-on-pay vote” were voted in favor of the proposal. We have considered the 20202023 say-on-pay vote, and we believe that the substantial support of our stockholders for the 20202023 say-on-pay vote proposal indicates that our stockholders are generally supportive of our approach to executive compensation. Thus, we have not made any material changes to our executive compensation arrangements in response to the 20202023 say-on-pay vote. At our 20172023 meeting of stockholders, our stockholders voted in favor of the proposal to hold say-on-pay votes every three years. Accordingly, the next say-on-pay advisory vote will be held this year at our 20232026 meeting of stockholders. We will also hold an advisory vote this year at our 2023 meeting of stockholders concerning the frequency of the say-on-pay advisory vote. In the future, we will continue to consider the outcome of our say-on-pay votes when making compensation decisions regarding the named executive officers.
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 30 |
28
Back to Contents
THE COMPONENTS OF OUR EXECUTIVE COMPENSATION PROGRAM
To achieve the above goals, we have created an executive compensation program which consists of base pay, a short-term performance-based cash bonus program pursuant to the Incentive Bonus Plan, or IBP, and an equity grant program providing long-term incentives.
|
| Pay Element | Objective |
FIXED | Annual | Base Salary | Annual
| BaseSalary
| • Provides a degree of financial certainty and stability that helps us retain talent. Recognizes competitive market conditions and/or rewards individual performance through periodic increases. |
ATRISKORPERFORMANCE-BASED
| Long-Term | Restricted Stock Units and Performance Stock Units | Long-Term
| RestrictedStockUnitsandPerformanceStock Units
| • Provides a direct link to the creation of stockholder value and execution of our strategy. Aligns NEOs’ interests with stockholders. Fosters long-term focus and retention. |
AT RISK OR PERFORMANCE-BASED | Annual | Incentive Bonus Plan (IBP) | IncentiveBonusPlan(IBP)
| • Motivates NEOs to meet or exceed our annual performance goals to drive annual performance and position us for longer-term success. Measures NEOs’ performance against pre-established Company performance goals. Aligns all staff members around the same Company performance goals as all such annual cash incentive awards are based on the same Company financial performance goals. |
We use this mix of compensation types for a variety of reasons:
•
These types of programs, as a package, are typically offered by the companies from which we seek executive talent.
•
| • | These types of programs, as a package, are typically offered by the companies from which we seek executive talent. |
| • | These programs provide immediate and long-term incentives for the executive officers, thereby helping to align the executives’ interests with those of the Company and its stockholders. |
| • | We apply differing performance goals to the various types of pay to help motivate the executives to accomplish separate and diverse corporate and individual goals. |
| • | Diverse programs, performance goals and payout timing help manage risk taking. |
These programs provide immediate and long-term incentives for the executive officers, thereby helping to align the executives’ interests with those of the Company and its stockholders.
•
We apply differing performance goals to the various types of pay to help motivate the executives to accomplish separate and diverse corporate and individual goals.
•
Diverse programs, performance goals and payout timing help manage risk taking.
We provide executives with a package of fringe benefits on the same basis that is provided to all full-time benefits eligible employees. These benefits include such items as health insurance, tax qualified profit sharing plan contributions and group term life insurance. We do not provide the executives with any benefits that are not generally available to other full-time professional employees, other than the benefits provided to participants under the Executive Change in Control Severance Plan adopted in February 2022, which are described in this proxy statement under the heading “Potential Payments Upon Termination or Change in Control.”
We believe that our executive compensation program, taken as a whole, is a cost-effective method of providing competitive pay to our named executive officers and implementing our compensation philosophy and objectives.
OUR PROCESS FOR SETTING EXECUTIVE COMPENSATION
Our Human Resources Department provides various types of compensation information to the President/Chief Executive Officer and to the Compensation Committee for their consideration and reference. The Compensation Committee’s focus is on the compensation of the President/Chief Executive Officer and the incentive bonus and equity awards of the named executive officers.
The President/Chief Executive Officer determines the base pay for the other named executive officers. Our process for setting executive compensation is described below.
❯BASE PAY
In connection with setting levels of base pay, our Human Resources Department reviews independently published surveys of executive compensation levels, which cover over 1,000 U.S. based companies varying in size and industry and prepares a report summarizing their findings. In 2022,2023, Compensia, Inc. acted as a compensation advisor to our Compensation Committee. In 2022,2023, our Human Resources Department also reviewed data from the Radford Technology Survey, which provides data from a wide range of technology sub-industries, and Main Data Group, Inc., which provides compensation information for executive positions in publicly traded peer companies. From this information, our Human Resources Department determined the market salary at the median level for each comparable executive position. In
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 31 |
addition, we review the compensation of a smaller
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 29
Back to Contents
group of companies in industry sectors in which we compete to provide additional guidance in setting base pay. This group consists of the companies in our peer group. We consider a number of potential criteria to determine which companies to include in our peer group, including companies in our industry of comparable size as measured by sales, market capitalization or asset base, in our geographic proximity, and with whom we compete for employee talent.
In 20222023 the companies we considered comprising our peer group were:
• Agilent Technologies Inc. | |
| •
Mettler-Toledo International Inc. |
| • NuVasive, Inc. |
| • Charles River Laboratories, Inc. | Qiagen N.V. |
• The Cooper Companies Inc. | Quidel Corporation |
| ResMed Inc. |
| Revvity, Inc. |
• IDEXX Laboratories, Inc. | Steris Corporation |
| Teleflex Incorporated |
• Integer Holdings Corporation | Waters Corporation |
• Integra LifeSciences Holdings Corporation | |
•
Intuitive Surgical, Inc.
| •
West Pharmaceutical Services, Inc. |
| • LivaNova PLC | |
The 20222023 peer group was modified relative to our 20212022 peer group as follows: The following six companies werecompaniy was removed: Edwards Lifesciences Corporation, Hill-Rom Holdings, Inc., ICON plc, PRA Health Sciences, Inc., Syneos Health, Inc. and Varian Medical Systems,Intuitive Surgical, Inc. The following four companies were added: The Cooper Companies Inc., Dentsply Sirona Inc., Quidel Corporation, and West Pharmaceutical Services, Inc. The 20222023 peer group includes twenty-twotwenty-one life sciences and medical products companies with $1 to $5 billion in annual revenues in order to include companies that were of similar size and in similar industries to the Company.
The modificationsmodification to the peer group werewas made to more closely align the size and industry of the peer group companies to the size and industry of the Company.
Our Human Resources Department reviews this information with the President/Chief Executive Officer, and with respect to the President/Chief Executive Officer directly with the Compensation Committee, who then decide at their discretion if the individual base pay levels of executives need to be adjusted. Our Compensation Committee does not see any of the individual companies in the surveys, except for the companies within our peer group with respect to our President/Chief Executive Officer’s base pay. Other factors considered in determining base pay, in addition to the survey and peer group information presented by the Human Resources Department, are:
•
The financial position of the Company compared to the previous year;
•
| • | The financial position of the Company compared to the previous year; |
| • | General economic conditions both nationally and in the local market of our corporate office; |
| • | The executive’s achievement of individual performance goals established for the year; and |
| • | Where the executive’s current base pay falls relative to survey data and other company executives. |
General economic conditions both nationally and in the local market of our corporate office;
•
The executive’s achievement of individual performance goals established for the year; and
•
Where the executive’s current base pay falls relative to survey data and other company executives.
Based on all of the factors outlined above, as well as the market data, the Compensation Committee, in the case of the President/Chief Executive Officer, and the President/Chief Executive Officer, for the other named executive officers, determine the named executive officer’s base pay for the following year, and thus any of these criteria could materially impact the named executive officer’s base pay.
In 2022,2023, each of our named executive officers received a merit increase to his/her base pay based on the factors described above.above, other than Mr. Schwartz who waived a salary increase. These increases ranged from 4%3% to 15.85%5% of base pay and were effective as of April 1, 2022, except for Dr. May’s salary increase, which was effective January 4, 2022 when he became an executive officer.2023. As a result, our named executive officers’ annual base salaries effective April 1, 20222023 were as follows: Mr. Schwartz: $1,040,000; Mr. Daskal: $596,500;$615,000; Dr. Last $646,000;$665,000; Ms. Grantham Wright: $546,009;$567,850; and Dr. May: $500,000.$523,750.
❯INCENTIVE BONUS PLAN, OR IBP (CASH-BASED INCENTIVE PROGRAM)
All of our named executive officers participate in our company-wide annual cash bonus program, which is known as the Incentive Bonus Plan, or IBP. The plan, which covers all of the named executive officers, as well as other employees, operates on a calendar year basis. At the beginning of the year, objective performance metrics in areas of achievement are determined and approved by executive management. In 20222023 the metrics were:
•
| • | Global Sales; and |
| • | Profit expressed as global operating income (OI). |
Profit expressed as global operating income (OI); and
•
A group metric objective.
Depending on which part of our organization an employee works, these metrics are applied at the company-wide or Corporate level, or at a combination of the Corporate and business group levels. The bonuses of all our named executive officers were based on the following weighting of these metrics: Corporate Sales (50%(60%), Corporate OI (30%) and a Group metric objective relating to deployment of sales and operations planning (“S&OP”) (20%(40%).
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 30
Back to Contents
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 32 |
The following table shows our financial goals under the IBP for fiscal 20222023 relevant to our named executive officers for Corporate and Group Metric goals, and our performance compared to those goals (in millions):
| | IBP Target Plan | | Adjusted
Target Plan(1) | | Actual | | Adjusted
Results(2) | | % of
Target(3) | |
Corporate Goals | Sales | $2,927.5 | | $2,842.4 | | $2,802.2 | | $2,797.2 | | 98.4 | % |
| Operating Income (OI) | $531.8 | | $509.6 | | $482.6 | | $478.1 | | 93.8 | % |
Group Metric Goals | S&OP Deployment | 100% | | 100% | | 100.0% | | 100.0% | | 100.0 | % |
(1) We have the ability to modify the goals after the beginning of a year, particularly in response to an unforeseen change in business conditions that makes an established goal irrelevant or inappropriate, subject to the approval of our Chief Executive Officer. In 2022, we adjusted our IBP Target Plan Corporate Sales goal and IBP Target Plan Corporate OI goal to account for the effect of foreign currency. (2) We also have the ability to modify the calculation of the achievement of the results after the beginning of a year, particularly in response to an unforeseen change in business conditions, subject to the approval of our Chief Executive Officer. In 2022, we modified the Sales achievement and the OI achievement to account for certain legal matters, restructurings, and corrections to certain accounting policies. (3) Includes the effects of the adjustments and achieved results for our named executive officers as described in footnotes 2 and 3 above. |
| | | | IBP
Target Plan | | Adjusted IBP
Target Plan(1) | | Actual | | Adjusted
Results(2) | | % of
Target(3) |
| Corporate Goals | Sales | | $3,017.1 | | $3,017.1 | | $2,671.3 | | $2,678.5 | | 88.8% |
| | Operating Income (OI) | | $550 | | $486.9 | | $337.8 | | $339.8 | | 69.8% |
| (1) | We have the ability to modify the goals after the beginning of a year, particularly in response to an unforeseen change in business conditions that makes an established goal irrelevant or inappropriate, subject to the approval of our Chief Executive Officer. In 2023, we adjusted our IBP Target Plan Corporate OI goal to account for changes in business conditions that resulted in a reduction to our targeted operating income under our 2023 operating plan and for the effect of foreign currency, and the Compensation Committee approved this adjustment. |
| (2) | We also have the ability to modify the calculation of the achievement of the results after the beginning of a year, particularly in response to an unforeseen change in business conditions, subject to the approval of our Chief Executive Officer. In 2023, we modified the Sales achievement and the OI achievement to account for the effect of foreign currency. |
| (3) | Includes the effects of the adjustments and achieved results for our named executive officers as described in footnotes 2 and 3 above. |
We believe these performance metrics promote a strong link between employee contribution and overall company performance. By rewarding employees for meeting and exceeding goals for sales and global operating income, and a group metric objective, we motivate them to improve the Company’s performance.
The IBP makes a payout only if threshold levels equal to 95% of the sales goals, and/or 90% of the operating income goals and/or 50% of the group metric objective are satisfied. In order for the group metric objective to be paid, the threshold level of corporate operating income must be achieved. If the sales goal and/or operating income and/or group metric objective goal is met, the named executive officers as well as other IBP participants receive a payment indexed to a percentage of their base pay, based on the achievement relative to each of the established metrics. The percentage of base pay which can be awarded varies based upon job position/salary grade. In 20222023 the target bonuses for our named executive officers as a percentage of their base pay were as follows: Mr. Schwartz: 125% (increased(no change from 115% in 2021)2022); Mr. Daskal: 75% (increased(no change from 65% in 2021)2022); Dr. Last: 85% (increased(no change from 80% in 2021)2022); Ms. Grantham Wright: 70% (increased(no change from 55% in 2021)2022); and Dr. May: 70% (increased(no change from 55% in 2021)2022). The payments under this program can be as much as twice the target bonus, but the named executive officers (as well as the other people who participate in the IBP) will not receive this benefit unless we meet the minimum required performance goals for each performance measure.
The IBP also has an individual component, which allows managers to adjust the calculated financial award upward or downward by up to 20%, based on a manager’s assessment of the contribution of the participant and of the participant’s small team toward the financial results that the Company achieves. In 2022,2023, the IBP awards for all named executive officers were not adjusted for this individual component of the IBP.
With respect to bonuses awarded for 2022,2023, our named executive officers achieved 86.8% of their target bonus opportunity.below required IBP payout thresholds for the sales goal and the operating income goal, so no bonuses were paid to our named executive officers under the 2023 IBP. Payments are typically made during the first quarter of the following year.
We establish the individual target bonus levels, in part, by reviewing competitive market data of companies in our peer group described above. The individual target bonus levels for our named executive officers in 20222023 are set forth in the “Grants of Plan-Based Awards Table,” and the bonuses paid to our named executive officers under the 20222023 IBP are set forth in the “Non-Equity Incentive Plan Compensation” column of the “Summary Compensation Table.”
Our Company also reserves the right to award discretionary bonus payments to employees. No such payments were made to any of the named executive officers in the last year.
❯EQUITY COMPENSATION
Another key component of our executive compensation program is equity grants. We make grants of restricted stock units and performance stock units to the named executive officers, as well as other employees, under our 2017 Incentive Award Plan.
In 2023 and 2022, we granted Class A common stock performance stock units (“PSUs”) and Class A common stock restricted stock units (“RSUs”) to our named executive officers. Prior to 2022, our named executive officers were granted RSUs, and were granted non-qualified stock options instead of PSUs. We generally granted options to purchase Class A Common Stock and Class A Common Stock RSUs to all named executive officers. In certain years prior to 2017, Norman Schwartz received options to acquire Class B Common Stock and Class B Common restricted stock units. The holders of Class B Common Stock have certain preferential voting rights, as described in the section titled “General Information About the Meeting and Voting” above.
The PSUs granted to our named executive officers in 20222023 have a three-yearone-year performance period that begins on January 1, 20222023 and ends on December 31, 20242023 and then vest two years following the end of the performance period on December 31, 2025 subject to the holder’s continued employment with the Company. The performance measure is adjusted EBITDA margin, and achievement is measured against a targetrange of targets for fiscal year 2024. The PSUs are subject to acceleration of 1/3 of the target number of PSUs if Bio-Rad meets or exceeds an adjusted EBITDA margin target for fiscal year 2023, and if Bio-Rad does not meet or exceed the adjusted EBITDA margin target at that time, then 100% of the target shares remain available, subject to continued employment with the Company.Company, with the target adjusted EBITDA margin goal for 2023 set at 22.1%. A threshold number of shares may be issued in settlement of the PSUs equal to 50% of the target number of PSUs subject to attainment of the threshold adjusted EBITDA margin goal for 2024.2023. The maximum number of shares that may
BIO-RAD LABORATORIES, INC. - 2023 Proxy Statement 31
Back to Contents
be issued in settlement of the PSUs is two times the target number of PSUs subject to attainment of the maximum adjusted EBITDA margin goal. In the event of a “change in control” (as defined in the 2017 Incentive Award Plan), (i) prior to December 31, 2023, the PSUs will accelerate in full at the greater of actual or target performance, and (ii) following December 31, 2023, the PSUs will accelerate in full at the actual performance. The Company did not attain the threshold adjusted EBITDA margin goal for 2023 and thus the 2023 PSUs were forfeited.
| BIO-RAD LABORATORIES, INC. - 2024 Proxy Statement | 33 |
The PSUs granted to our named executive officers in 2022 were subject to acceleration of 1/3 of the target number of PSUs if Bio-Rad met or exceeded an adjusted EBITDA margin stretch goal for fiscal year 2023 of equal to or greater than +24.0%. The Company did not meet this 2023 adjusted EBITDA margin stretch goal and, thus, no shares were subject to acceleration. 100% of the PSUs remain available to be earned based on the adjusted EBITDA margin targets for 2024, subject to continued employment with the Company.
RSUs granted to our named executive officers in 20222023 vest on a four-year basis at a rate of 25% per year beginning one year from the grant date subject to continued employment with the Company. We granted a combination of RSUs and PSUs to our named executive officers to align ourselves with current market equity compensation practices. Prior to 2020, options that were granted generally vested on a five-year basis at a rate of 20% of the option grant on each anniversary date of the grant subject to continued employment with or service to the Company, and RSUs generally vested on a five-year basis at a rate of 20% per year beginning one year from the grant date subject to continued employment with the Company.
Our process for granting equity to named executive officers was as follows: first we consulted with our compensation advisor Compensia, Inc. about current market practices. Then, we conducted a general review of certain market information provided by outside independent equity compensation surveys, which cover large numbers of U.S. companies varying in size and industry. In 20222023 we determined competitive market grant levels using the Radford Technology Survey and information from Main Data Group, Inc. Next, we considered the size of the equity pool, which contains a number of shares that approximates a percentage of our outstanding shares as of the prior year, which in 20222023 was 0.6%0.7%. The amount of equity available for grant to all eligible employees, including our named executive officers, is generally limited by the size of this equity pool. Subject to this limitation and based on the market information, our Human Resources Department created individual equity grant recommendations, which provided a range of potential PSU grants and RSU grants based on job position/salary grade, including for the positions of our named executive officers.
Using the equity grant recommendations created by our Human Resources Department and considering individual performance, management suggested an allocation of the equity pool among all eligible employees to the Compensation Committee. The Compensation Committee reviewed the suggested allocation of awards and made a recommendation to the entire Board of Directors. Based on the Compensation Committee’s recommendation, the Board of Directors made its own determination as to the size and mix of the grants to individuals. The Board provided the approved equity grant and pricing information to the President/Chief Executive Officer for implementation. The Board of Directors metapproved the 2023 PSU equity grants to our named executive officers on June 21, 2023, with a grant date of June 21, 2023 and approved the 20222023 RSU equity grants to our named executive officers on September 1, 2022,2023 with a grant date of September 1, 2022.2023. The equity grants for our named executive officers in 20222023 are set forth in the “Grants of Plan-Based Awards Table.”
Our 2007 Incentive Award Plan and our 2017 Incentive Award Plan provide that in the event of a “change in control,” all equity awards will become fully exercisable and all forfeiture restrictions on such awards will lapse immediately prior to such change in control, unless otherwise specified in any applicable award agreement. The award agreements with respect to our outstanding restricted stock unit awards granted prior to 2016 provide that no such acceleration shall apply when the successor corporation assumes the equity awards or substitutes equivalent rights for such awards. In February 2022, our board of directors adopted an Executive Change in Control Severance Plan, which provides for the payment of certain severance and other benefits to participants, including each of our named executive officers, in the event of a qualifying termination of employment with us. Under the Executive Change in Control Severance Plan, in the event of a termination of the executive’s employment that is (i) by the Company for any reason other than for “cause,” (ii) as a result of the participant’s death or “disability,” or (iii) by the participant for “good reason,” in each case, during the two year period beginning on, and following, the date of a “change in control” (as defined in the plan), amongst other benefits which are described in this proxy statement under the heading “Potential Payments Upon Termination or Change in Control”, the executive will be eligible for accelerated vesting of 100% of the total number of shares subject to each equity award held by the executive (with any awards subject to performance vesting to be determined pursuant to the applicable award agreement).
We believe that the grant of RSUs and PSUs provides benefits to both the Company and the executive. We benefit because:
•
The RSUs and the PSUs help to align the executive’s financial interest with the Company’s and the stockholders’ long-term interests.
•
| • | The RSUs and the PSUs help to align the executive’s financial interest with the Company’s and the stockholders’ long-term interests. |
| • | The RSUs and PSUs help us retain the executives in a competitive market. |
The RSUs and PSUs help us retain the executives in a competitive market.
The executives benefit because:
| • | They can realize additional income as grants vest or if our shares increase in value. |
•OTHER COMPENSATION
They can realize additional income as grants vest or if our shares increase in value.
