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SCHEDULE 14A
INFORMATION
Proxy Statement Pursuant to
Section 14(a) of the Securities Exchange Act of 1934
(Amendment
No.__)
Filed by the
Registrant |
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Filed by a Party
other than the Registrant |
☐ |
Check the appropriate box:
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Preliminary
Proxy Statement |
☐ |
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Confidential,
for Use of the Commission Only (as permitted by Rule
14a-6(e)(2)) |
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Definitive Proxy
Statement |
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Definitive
Additional Materials |
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Soliciting
Material Pursuant to §240.14a-12 |
YELP INC. |
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(Name
of Registrant as Specified In Its Charter) |
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(Name of Person(s) Filing Proxy Statement if Other Than the
Registrant) |
Payment of Filing Fee (Check the
appropriate box)
☒ |
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No fee
required. |
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Fee computed on
table below per Exchange Act Rules 14a-6(i)(1) and
0-11. |
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Title of each class of securities
to which transaction applies: |
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Aggregate number of securities to
which transaction applies: |
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Per unit price or other
underlying value of transaction computed pursuant to Exchange Act Rule
0-11 (set forth the amount on which the filing fee is calculated and state
how it was determined): |
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Proposed maximum aggregate value
of transaction: |
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Total fee paid: |
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Fee paid previously with
preliminary materials. |
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Check box if any part of the fee
is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the
filing for which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the Form or Schedule
and the date of its filing. |
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Amount Previously
Paid: |
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Form, Schedule or Registration
Statement No.: |
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Filing Party: |
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Date Filed: |
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Table of
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YELP INC.
140 New Montgomery Street
San Francisco,
California 94105
NOTICE OF ANNUAL MEETING OF
STOCKHOLDERS
To Be Held on May 20, 2015
Dear Stockholder:
You are cordially invited to attend the Annual Meeting (the Annual Meeting) of Stockholders of YELP INC., a Delaware corporation (the Company). The Annual Meeting will be held on Wednesday, May
20, 2015 at
9:00 a.m.
Pacific Time at
The St. Regis San
Francisco located at 125 3rd Street, San Francisco, California 94103 for the following purposes:
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To elect the three
nominees for director named in the accompanying proxy statement (the
Proxy Statement) to hold office until the 2018 Annual Meeting of
Stockholders. |
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2. |
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To ratify the
selection by the Audit Committee of the Board of Directors of Deloitte
& Touche LLP as the independent registered public accounting firm of
the Company for the year ending December 31, 2015. |
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3. |
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To approve, on an
advisory basis, the compensation of the Companys named executive
officers, as disclosed in the Proxy Statement. |
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4. |
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To conduct any other
business properly brought before the Annual
Meeting. |
These items of business are more fully described in the Proxy Statement accompanying this Notice.
The record date for the Annual Meeting is March 23, 2015. Only stockholders of record at the close of business on that date may vote at the Annual Meeting or any adjournment
thereof.
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By Order of the Board of
Directors |
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![](yelp_def14a1x2x1.jpg) |
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Laurence Wilson |
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Corporate
Secretary |
San Francisco, California
April 10, 2015
You are cordially invited to
attend the Annual Meeting in person. Whether or not you expect to attend
the Annual Meeting, please vote over the telephone or Internet, or, if you
receive a paper proxy card by mail, by completing and returning the proxy
card mailed to you, as promptly as possible in order to ensure your
representation at the Annual Meeting. Voting instructions are provided in
the Notice of Internet Availability of Proxy Materials, or, if you receive
a paper proxy card by mail, the instructions are printed on your proxy
card and included in the accompanying Proxy Statement. Even if you have
voted by proxy, you may still vote in person if you attend the Annual
Meeting. Please note, however, that if your shares are held of record by a
broker, bank or other nominee and you wish to vote at the Annual Meeting,
you must obtain a proxy issued in your name from that record
holder. |
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TABLE OF CONTENTS
Table of
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YELP INC.
140 New Montgomery Street
San Francisco, California
94105
PROXY
STATEMENT
FOR THE 2015 ANNUAL MEETING
OF STOCKHOLDERS
May 20, 2015
QUESTIONS AND ANSWERS ABOUT THESE
PROXY MATERIALS AND VOTING
We are
providing you with these proxy materials because the Board of Directors of Yelp
Inc., or the Board, is soliciting your proxy to vote at Yelps 2015 Annual
Meeting of Stockholders, or the Annual Meeting, including at any adjournments or
postponements thereof, to be held on Wednesday, May 20, 2015 at 9:00 a.m.
Pacific Time at The St. Regis San Francisco located at 125 3rd
Street, San Francisco, California 94103. You are invited to attend the Annual
Meeting to vote on the proposals described in this Proxy Statement. However, you
do not need to attend the Annual Meeting to vote your shares. Instead, you may
simply follow the instructions below to submit your proxy. The proxy materials,
including this Proxy Statement and our 2014 Annual Report, are being distributed
and made available on or about April 10, 2015. As used in this Proxy Statement,
references to we, us, our, Yelp and the Company refer to Yelp Inc. and
its consolidated subsidiaries.
Why did I receive a notice regarding
the availability of proxy materials on the Internet?
Pursuant to
rules adopted by the U.S. Securities and Exchange Commission, or SEC, we have
elected to provide access to our proxy materials over the Internet.
Consequently, our stockholders generally will not receive paper copies of our
proxy materials unless they request them. We will instead send a Notice of
Internet Availability of Proxy Materials, or Notice, to our stockholders of
record with instructions for accessing the proxy materials and voting over the
Internet or by telephone. All stockholders will have the ability to access the
proxy materials on the website referred to in the Notice or request to have a
printed set of the proxy materials. Instructions on how to access the proxy
materials over the Internet or to request a printed copy may be found in the
Notice.
We intend to
mail the Notice on or about April 10, 2015 to all stockholders of record entitled
to vote at the Annual Meeting.
Will I receive any other proxy
materials by mail?
We may send
you a proxy card, along with a second Notice, on or after April 20, 2015. In
addition, you may request a printed copy of our proxy materials by following the
instructions found in the Notice.
Who can vote at the Annual
Meeting?
Only
stockholders of record at the close of business on March 23, 2015 will be
entitled to vote at the Annual Meeting. On this record date, there were
65,026,266 shares of Class A common stock and 9,611,108 shares of Class B common
stock outstanding and entitled to vote.
Stockholders of Record: Shares
Registered in Your Name
If on March
23, 2015 your shares were registered directly in your name with our transfer
agent, Computershare Trust Company, N.A., then you are a stockholder of record.
As a stockholder of record, you may vote in person at the Annual Meeting or vote
by proxy. Whether or not you plan to attend the Annual Meeting, we urge you to
vote your shares electronically over the Internet or by telephone, or by
completing and returning a printed proxy card that you may request or that we
may elect to deliver at a later time, to ensure your vote is counted.
Beneficial Owners: Shares Registered
in the Name of a Broker or Bank
If on March
23, 2015 your shares were held not in your name, but rather in an account at a
brokerage firm, bank, dealer or other similar organization, then you are a
beneficial owner of shares held in street name and the Notice is being
forwarded to you by that organization. The organization holding your account is
considered to be the stockholder of record for purposes of voting at the Annual
Meeting. As a beneficial owner, you have the right to direct your broker or
other agent regarding how to vote the shares in your account. You are also
invited to attend the Annual Meeting. However, because you are not the
stockholder of record, you may not vote your shares in person at the Annual
Meeting unless you request and obtain a valid proxy from your broker or other
agent.
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What am I voting on?
There are
three matters scheduled for a vote:
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Proposal No. 1: the election of three directors; |
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Proposal No. 2: the ratification of the selection by the Audit
Committee of the Board of Deloitte & Touche LLP as our independent
registered public accounting firm for the year ending December 31, 2015;
and |
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Proposal No. 3: the
approval, on an advisory basis, of the compensation of our named executive
officers, as disclosed in this Proxy Statement in accordance with SEC
rules. |
What if another matter is properly
brought before the Annual Meeting?
The Board
knows of no other matters that will be presented for consideration at the Annual
Meeting. If any other matters are properly brought before the Annual Meeting, it
is the intention of the persons named in the proxy to vote on those matters in
accordance with their best judgment.
How do I vote?
You may vote
For all the nominees to the Board, Withhold your vote from all nominees or
you may Withhold your vote for any nominee you specify. For each of the other
matters to be voted on, you may vote For or Against the proposal, or abstain
from voting.
The
procedures for voting are as follows:
Stockholders of Record: Shares
Registered in Your Name
If you are a
stockholder of record, you may vote in person at the Annual Meeting, vote by
proxy over the telephone, vote by proxy through the Internet or vote by proxy
using a proxy card that you may request or that we may elect to deliver at a
later time. Whether or not you plan to attend the Annual Meeting, we urge you to
vote by proxy to ensure your vote is counted. You may still attend the Annual
Meeting and vote in person even if you have already voted by proxy.
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To vote in person, come to the
Annual Meeting and we will give you a ballot when you arrive. Directions to
the Annual Meeting may be found at
http://www.stregissanfrancisco.com/directions. |
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To vote over the telephone, dial
toll-free 1-800-690-6903 using a touch-tone phone and follow the recorded
instructions. You will be asked to provide the control number from the
Notice. Your vote must be received by 11:59 p.m. Eastern Time on May 19,
2015 to be counted. |
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To vote through the Internet, go to
www.proxyvote.com to complete an electronic proxy card. You will be asked
to provide the control number from your Notice. Your vote must be received
by 11:59 p.m. Eastern Time on May 19, 2015 to be counted. |
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To vote using the printed proxy card
that may be delivered to you, simply complete, sign and date the proxy
card and return it promptly in the envelope provided. If you return your
signed proxy card to us before the Annual Meeting, we will vote your
shares as you instruct. |
Beneficial Owners: Shares Registered
in the Name of a Broker or Bank
If you are a
beneficial owner of shares registered in the name of your broker, bank or other
agent, you should have received a Notice containing voting instructions from
that organization rather than from us. Simply follow the voting instructions in
the Notice to ensure that your vote is counted. To vote in person at the Annual
Meeting, you must obtain a valid proxy from your broker, bank or other agent.
Follow the instructions from your broker or bank included with these proxy
materials, or contact your broker or bank to request a proxy form.
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We provide Internet proxy
voting to allow you to vote your shares online, with procedures designed
to ensure the authenticity and correctness of your proxy vote
instructions. However, please be aware that you must bear any costs
associated with your Internet access, such as usage charges from Internet
access providers and telephone companies. |
Can I vote my shares by filling out
and returning the Notice?
No. The
Notice identifies the items to be voted on at the Annual Meeting, but you cannot
vote by marking the Notice and returning it. The Notice provides instructions on
how to vote by telephone or through the Internet, by requesting and returning a
printed proxy card or by submitting a ballot in person at the Annual
Meeting.
How many votes do I
have?
On each
matter to be voted on, you have one vote for each share of Class A common stock
and ten votes for each share of Class B common stock you owned as of March 23,
2015. The Class A common stock and Class B common stock will vote together as a
single class on all proposals described in this Proxy Statement.
What happens if I do not
vote?
Stockholders of Record: Shares
Registered in Your Name
If you are a
stockholder of record and do not vote by telephone, through the Internet, by
completing a proxy card that may be delivered to you or in person at the Annual
Meeting, your shares will not be voted.
Beneficial Owners: Shares Registered
in the Name of a Broker or Bank
If you are a
beneficial owner and do not instruct your broker, bank or other agent how to
vote your shares, the question of whether your broker or nominee will still be
able to vote your shares depends on whether the New York Stock Exchange, or
NYSE, deems the particular proposal to be a routine matter. Brokers and
nominees can use their discretion to vote uninstructed shares with respect to
matters that are considered to be routine, but not with respect to
non-routine matters.
Under the
rules and interpretations of the NYSE, non-routine matters are matters that
may substantially affect the rights or privileges of stockholders, such as
mergers, stockholder proposals, elections of directors (even if not contested),
executive compensation (including any advisory stockholder votes on executive
compensation and on the frequency of stockholder votes on executive
compensation) and certain corporate governance proposals, even if management
supported. Accordingly, your broker or nominee may not vote your shares on
Proposal No. 1 or Proposal No. 3 without your instructions, but may vote your
shares on Proposal No. 2.
What if I return my proxy card or
otherwise vote but do not make specific choices?
If you return
a signed and dated proxy card or otherwise vote without marking voting
selections, your shares will be voted, as applicable:
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For the election of all three nominees for
director; |
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For the ratification of the selection of Deloitte & Touche
LLP as our independent registered public accounting firm for the year
ending December 31, 2015; and |
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For the advisory approval of executive
compensation. |
If any other
matter is properly presented at the Annual Meeting, your proxy holder (one of
the individuals named on your proxy card) will vote your shares using his best
judgment.
Who is paying for this proxy
solicitation?
We will pay
for the entire cost of soliciting proxies. In addition to these proxy materials,
our directors and employees may also solicit proxies in person, by telephone or
by other means of communication. Directors and employees will not be paid any
additional compensation for soliciting proxies. We may also reimburse brokerage
firms, banks and other agents for the cost of forwarding proxy materials to
beneficial owners.
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What does it mean if I receive more
than one Notice?
If you
receive more than one Notice, your shares may be registered in more than one
name or in different accounts. Please follow the voting instructions on each of
your Notices to ensure that all of your shares are voted.
Can I change my vote after
submitting my proxy?
Stockholders of Record: Shares
Registered in Your Name
Yes. You can
revoke your proxy at any time before the final vote at the Annual Meeting. If
you are the record holder of your shares, you may revoke your proxy in any one
of the following ways:
● |
You may grant a
subsequent proxy by telephone or through the Internet. |
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You may submit another properly completed
proxy card with a later date. |
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You may send a timely written notice that you are
revoking your proxy to our Corporate Secretary at 140 New Montgomery
Street, 9th Floor, San Francisco, California 94105.
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You may attend the Annual Meeting and vote in person.
Simply attending the Annual Meeting will not, by itself, revoke your
proxy. |
Your most
current proxy card or telephone or Internet proxy is the one that is
counted.
Beneficial Owners: Shares Registered
in the Name of a Broker or Bank
If your
shares are held by your broker or bank as a nominee or agent, you should follow
the instructions provided by your broker or bank.
How are votes
counted?
Votes will be
counted by the inspector of election appointed for the Annual Meeting, who will
separately count, for Proposal No. 1 to elect directors, For and Withhold
votes and broker non-votes, and, with respect to all other proposals, votes
For and Against, abstentions and, if applicable, broker
non-votes.
What are broker
non-votes?
As discussed
above, when a beneficial owner of shares held in street name does not give
instructions to the broker or nominee holding the shares as to how to vote on
matters deemed by the NYSE to be non-routine, the broker or nominee cannot
vote the shares. These unvoted shares are counted as broker
non-votes.
How many votes are needed to approve
each proposal?
The following
table summarizes the minimum vote needed to approve each proposal and the effect
of abstentions and broker non-votes.
Proposal |
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Effect of |
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Effect of Broker |
Number |
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Proposal Description |
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Vote Required for
Approval |
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Abstentions |
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Non-Votes |
1 |
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Election of
Directors |
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Three nominees receiving the most
For votes from the holders of shares present and entitled to
vote |
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Withheld votes will have no
effect |
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None |
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2 |
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Ratification of the selection of
Deloitte & Touche LLP as our independent registered public accounting
firm for the year ending December 31, 2015 |
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For votes from the holders of
shares representing a majority of the voting power of the shares present
and entitled to vote |
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Against |
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None* |
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3 |
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Advisory approval of the
compensation of our named executive officers |
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For votes from the holders of
shares representing a majority of the voting power of the shares present
and entitled to vote |
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Against |
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None |
* |
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Broker non-votes will
have no effect; however, Proposal No. 2 is considered a routine matter,
and therefore no broker non- votes are expected to exist in connection
with Proposal No. 2. |
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What is the quorum
requirement?
In order to
conduct business at the Annual Meeting, a quorum must be present in person or
represented by proxy. A quorum will be present if shares representing a majority
of the aggregate voting power of shares of Class A common stock and Class B
common stock (voting together as a single class) entitled to vote are present at
the Annual Meeting in person or represented by proxy. On the record date, there
were 65,026,266 shares of Class A common stock and 9,611,108 shares of Class B
common stock outstanding and entitled to vote. Thus, the holders of shares
representing an aggregate of 80,568,674 votes must be present in person or
represented by proxy at the Annual Meeting to have a quorum.
Your shares
will be counted towards the quorum only if you submit a valid proxy (or one is
submitted on your behalf by your broker, bank or other nominee) or if you attend
the Annual Meeting in person. Abstentions and broker non-votes will be counted
towards the quorum requirement. If there is no quorum, the holders of shares
representing a majority of the voting power present at the Annual Meeting in
person or represented by proxy may adjourn the Annual Meeting to another
date.
When are stockholder proposals and
director nominations due for next years annual meeting?
To be
considered for inclusion in next years proxy materials, you must submit your
proposal, in writing, by December 12, 2015 to our Corporate Secretary at 140 New
Montgomery Street, 9th Floor, San Francisco, California 94105, and
you must comply with all applicable requirements of Rule 14a-8 promulgated under
the Securities Exchange Act of 1934, as amended, or the Exchange Act.
Pursuant to
our Bylaws, if you wish to bring a proposal before the stockholders or nominate
a director at the 2016 Annual Meeting of Stockholders, but you are not
requesting that your proposal or nomination be included in next years proxy
materials, you must notify our Corporate Secretary, in writing, not later than
the close of business on February 20, 2016 nor earlier than the close of
business on January 21, 2016. However, if our 2016 Annual Meeting of
Stockholders is not held between April 20, 2016 and June 19, 2016, to be timely,
notice by the stockholder must be received not earlier than the close of
business on the 120th day prior to the 2016 Annual Meeting of
Stockholders and not later than the close of business on the later of the
90th day prior to the 2016 Annual Meeting of Stockholders or the
10th day following the day on which public announcement of the date
of the 2016 Annual Meeting of Stockholders is first made. You are also advised
to review our Bylaws, which contain additional requirements about advance notice
of stockholder proposals and director nominations.
The chair of
the 2016 Annual Meeting of Stockholders may determine, if the facts warrant,
that a matter has not been properly brought before the meeting and, therefore,
may not be considered at the meeting. In addition, the proxy solicited by the
Board for the 2016 Annual Meeting of Stockholders will confer discretionary
voting authority with respect to (i) any proposal presented by a stockholder at
that meeting for which we have not been provided with timely notice and (ii) any
proposal made in accordance with our Bylaws, if the 2016 proxy statement briefly
describes the matter and how managements proxy holders intend to vote on it, if
the stockholder does not comply with the requirements of Rule 14a-4(c)(2)
promulgated under the Exchange Act.
How can I find out the results of
the voting at the Annual Meeting?
Preliminary
voting results will be announced at the Annual Meeting. In addition, final
voting results will be published in a current report on Form 8-K that we expect
to file with the SEC within four business days after the Annual Meeting. If
final voting results are not available to us in time to file a Form 8-K within
four business days after the Annual Meeting, we intend to file a Form 8-K to
publish preliminary results and, within four business days after the final
results are known to us, file an additional Form 8-K to publish the final
results.
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PROPOSAL NO.
1
ELECTION OF
DIRECTORS
Our Board is
divided into three classes. Each class consists, as nearly as possible, of
one-third of the total number of directors, and each class has a three-year
term. Vacancies on the Board may be filled only by persons elected by a majority
of the remaining directors. A director elected by the Board to fill a vacancy in
a class, including vacancies created by an increase in the number of directors,
will serve for the remainder of the full term of that class and until the
directors successor is duly elected and qualified.
The Board
presently has nine members. There are three directors in the class whose term of
office expires in 2015. If elected at the Annual Meeting, each of these nominees
would serve until the 2018 Annual Meeting of Stockholders and until his
successor has been duly elected and qualified, or, if sooner, until the
directors death, resignation or removal. Under our Corporate Governance
Guidelines, directors are encouraged and expected to attend the Annual Meeting.
All nine directors attended the 2014 Annual Meeting of Stockholders.
The following
table sets forth information with respect to our directors, including the three
nominees for election at the Annual Meeting, as of March 23, 2015:
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DIRECTOR |
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PRINCIPAL OCCUPATION/ |
NAME |
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AGE |
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SINCE |
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POSITION HELD WITH THE COMPANY |
Class III Directors
Nominees for Election at the Annual Meeting |
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Geoff Donaker |
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42 |
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Dec. 2010 |
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Chief
Operating Officer |
Robert Gibbs |
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43 |
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May 2012 |
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Partner, The Incite Agency; Contributor,
MSNBC |
Jeremy Stoppelman |
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37 |
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Sept. 2005 |
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Co-Founder
and Chief Executive Officer |
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Class I Directors
Continuing in Office until the 2016 Annual
Meeting |
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Fred D. Anderson |
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70 |
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Feb. 2011 |
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Lead
Independent Director of the Board; Managing Director, Elevation
Partners |
Peter Fenton |
|
42 |
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Sept. 2006 |
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General Partner, Benchmark Capital |
Jeremy Levine |
|
41 |
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Nov. 2005 |
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Partner,
Bessemer Venture Partners |
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Class II Directors
Continuing in Office until the 2017 Annual
Meeting |
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Diane M. Irvine |
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56 |
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Nov. 2011 |
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Independent
Advisor |
Max R. Levchin |
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39 |
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Sept. 2004 |
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Chairman of the Board; Chief Executive Officer of HVF, LLC and
Affirm, Inc. |
Mariam Naficy |
|
44 |
|
Jan. 2014 |
|
Chief
Executive Officer, Minted LLC |
Each of the
listed nominees was recommended for election by the Nominating and Corporate
Governance Committee of the Board, or the Nominating Committee. Our Nominating
Committee seeks to assemble a Board that, as a whole, possesses the appropriate
balance of professional and industry knowledge, financial expertise and
high-level management experience necessary to oversee and direct our business.
To that end, the Nominating Committee has identified and evaluated these
nominees in the broader context of the Boards overall composition, with the
goal of selecting nominees who complement and strengthen the skills of other
members of the Board and who also exhibit integrity, collegiality, sound
business judgment and other qualities that the Nominating Committee views as
critical to the effective functioning of the Board.
Each of the
nominees listed below is currently a director. Mr. Stoppelman was elected to the
Board prior to our initial public offering, or IPO, pursuant to a Third Amended
and Restated Voting Agreement, dated January 22, 2010, by and among us and the
holders of our then-outstanding preferred stock, or the Voting Agreement.
Specifically, Mr. Stoppelman, as Chief Executive Officer, was the designee of
our then-outstanding Common Stock under the Voting Agreement. The Voting
Agreement expired by its terms at the time of our IPO and is no longer in
effect.
Directors are
elected by a plurality of the votes of the holders of shares present in person
or represented by proxy and entitled to vote on the election of directors. The
three nominees receiving the highest number of affirmative votes will be
elected. Shares represented by executed proxies will be voted, if authority to
do so is not withheld, for the election of the three nominees named below. If
any nominee becomes unavailable for election as a result of an unexpected
occurrence, shares that would have been voted for that nominee will instead be
voted for the election of a substitute nominee proposed by the Nominating
Committee. Each person nominated for election has agreed to serve if elected.
Our management has no reason to believe that any nominee will be unable to
serve.
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A brief
biography of each nominee and each director whose term will continue after the
Annual Meeting is set forth below. The biographies below also include
information regarding the specific experience, qualifications, attributes or
skills of each nominee or director that led the Nominating Committee to
determine that such individual should serve as a member of the Board as of the
date of this Proxy Statement.
NOMINEES FOR ELECTION FOR A THREE-YEAR
TERM
EXPIRING AT THE 2018 ANNUAL MEETING
Geoff
Donaker joined us in 2005 and has served as
our Chief Operating Officer since June 2006. Since joining Yelp, Mr. Donaker has
helped to orchestrate our geographic expansion, build our revenue lines and hire
our management team. Prior to joining us, Mr. Donaker served in various
management and business development roles at Internet companies, including eBay
Inc., an Internet marketplace and online payments platform company, and Excite,
an Internet search and content provider, from 1998 to 2005. Mr. Donaker began
his career with Mercer Management Consulting (now Oliver Wyman). He holds a B.S.
in Mechanical Engineering from Stanford University. The Nominating Committee
believes Mr. Donaker should serve on the Board due to his experience in the
Internet industry and the perspective gained from working with us since our
early stages.
Robert
Gibbs has been a Partner at The Incite
Agency, a strategic communications firm, since June 2013 and a contributor to
cable news channel MSNBC since February 2013. Mr. Gibbs previously served as a
senior campaign advisor to President Barak Obama for the 2012 presidential
election from January 2012 to November 2012. From January 2009 to February 2011,
he served as the 28th White House Press Secretary. Prior to January
2009, Mr. Gibbs was the Communications Director for then-U.S. Senator Obama and
for Mr. Obamas 2008 presidential campaign. Mr. Gibbs was Press Secretary for
Senator John Kerrys 2004 presidential campaign and previously specialized in
Senate campaigns, having served as Communications Director for the Democratic
Senatorial Campaign Committee and for four individual Senate campaigns,
including those of Mr. Obama in 2004 and Fritz Hollings in 1998. Mr. Gibbs holds
a B.A. in Political Science from North Carolina State University. The Nominating
Committee believes Mr. Gibbs should serve on the Board due to his significant
media, communications and public policy experience.
Jeremy
Stoppelman is our co-founder and has served
as our Chief Executive Officer since our inception in 2004. Prior to founding
Yelp, Mr. Stoppelman held various engineering roles at PayPal, Inc., an online
payment company, from February 2000 to June 2003, most recently serving as Vice
President of Engineering. Prior to PayPal, Mr. Stoppelman was a software
engineer at Excite@Home, an Internet company, from August 1999 to January 2000.
He holds a B.S. in Computer Science from the University of Illinois. The
Nominating Committee believes Mr. Stoppelman should serve on the Board due to
the perspective gained from his experience as one of our founders and our Chief
Executive Officer, as well as his experience in the Internet industry.
THE BOARD RECOMMENDS
A VOTE FOR ALL OF THE NAMED NOMINEES
DIRECTORS CONTINUING IN OFFICE
UNTIL THE 2016 ANNUAL MEETING
Fred D.
Anderson has been a Managing Director of
Elevation Partners, a private equity firm focused on the media and entertainment
industries, since July 2004. From March 1996 to June 2004, Mr. Anderson served
as Executive Vice President and Chief Financial Officer of Apple Inc., a
manufacturer of mobile communication and media devices, personal computers and
related software. Prior to joining Apple, Mr. Anderson was Corporate Vice
President and Chief Financial Officer of Automatic Data Processing, Inc., an
electronic transaction processing firm, from August 1992 to March 1996. On April
24, 2007, the SEC filed a complaint against Mr. Anderson and another former
officer of Apple. The complaint alleged that Mr. Anderson failed to take steps
to ensure that the accounting for an option granted in 2001 to certain
executives of Apple, including himself, was proper. Simultaneously with the
filing of the complaint, Mr. Anderson settled with the SEC, neither admitting
nor denying the allegations in the complaint. In connection with the settlement,
Mr. Anderson agreed to a permanent injunction from future violations of Sections
17(a)(2) and 17(a)(3) of the Securities Act of 1933, as amended, or the
Securities Act, and Section 16(a) of the Exchange Act and Rules 13b2-2 and 16a-3
thereunder, and from aiding and abetting future violations of Sections 13(a),
13(b)(2)(A), 13(b)(2)(B) and 14(a) of the Exchange Act and Rules 12b-20, 13a-1,
13a-13 and 14a-9 thereunder. He also agreed to disgorge approximately $3.5
million in profits and interest from the option he received and to pay a civil
penalty of $150,000. Under the terms of the settlement, Mr. Anderson may
continue to act as an officer or director of public companies. Mr. Anderson also
served on the boards of directors of Apple from June 2004 to September 2006,
Palm, Inc. from October 2007 to July 2010 and Move, Inc. from November 2006 to
March 2012. Mr. Anderson currently serves on the board of directors of eBay and
the board of trustees of Whittier College. Mr. Anderson holds a B.A. from
Whittier College and an M.B.A. from the University of California, Los Angeles.
The Nominating Committee believes Mr. Andersons extensive financial management
expertise as the former Chief Financial Officer of global technology firms gives
him the experience, qualifications and skills to serve as a director. In
addition, his significant expertise on the boards of directors of other public
and private technology companies at various stages of development provides the
Board with important perspectives on corporate governance matters.
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Peter
Fenton has been a General Partner at
Benchmark, a venture capital firm, where his investment interests include
software, digital media and technology-enabled devices, since September 2006.
Prior to joining Benchmark, Mr. Fenton was a Managing Partner at Accel Partners,
a venture capital firm, from October 1999 to May 2006. Prior to joining the
venture capital community, he was a General Manager of Video at Autonomy Virage,
Inc., a multimedia information retrieval company, from April 1996 to April 1998.
Mr. Fenton also serves on the boards of directors of Twitter, Inc., Hortonworks,
Inc., Zendesk, Inc. and New Relic, Inc. He holds a B.A. in Philosophy from
Stanford University and an M.B.A. from the Stanford University Graduate School
of Business. The Nominating Committee believes Mr. Fenton should serve on the
Board due to his extensive background in and experience with the venture capital
industry, providing guidance and counsel to a wide variety of Internet and
technology companies and serving on the boards of directors of a range of public
and private companies.
Jeremy
Levine is a Partner at Bessemer Venture
Partners, a venture capital firm, which he joined in May 2001, where his
investment interests include entrepreneurial startups and high growth companies
in industries including consumer Internet, consumer software and business
software and services. Prior to joining Bessemer, Mr. Levine was Vice President
of Operations at Dash.com Inc., an Internet software publisher, from June 1999
to May 2001. Prior to Dash, Mr. Levine was an Associate at AEA Investors, a
management buyout firm, where he specialized in consumer products and light
industrials, from July 1997 to June 1999. Previously, Mr. Levine was with
McKinsey & Company as a management consultant from June 1995 to July 1997.
Mr. Levine holds a B.S. in Computer Science and Economics from Duke University.
The Nominating Committee believes Mr. Levine should serve on the Board due to
his extensive background in and experience with the venture capital industry,
providing guidance and counsel to a wide variety of Internet and technology
companies and serving on the boards of directors of a range of private
companies.
DIRECTORS CONTINUING IN OFFICE
UNTIL THE 2017 ANNUAL MEETING
Diane M.
Irvine most recently served as Chief
Executive Officer of Blue Nile, Inc., an online retailer of diamonds and fine
jewelry, from February 2008 to November 2011 and as President from February 2007
to November 2011. Ms. Irvine also served on the board of directors of Blue Nile
from May 2001 to November 2011, and as the Chief Financial Officer of Blue Nile
from December 1999 to September 2007. From February 1994 to May 1999, Ms. Irvine
served as Vice President and Chief Financial Officer of Plum Creek Timber
Company, Inc., a timberland management and wood products company. From September
1981 to February 1994, Ms. Irvine served in various capacities, most recently as
a partner, with Coopers & Lybrand LLP, an accounting firm. Ms. Irvine
currently serves on the boards of directors of CafePress Inc., Rightside Group,
Ltd. and XO Group Inc. She previously served on the board of directors of
Ticketmaster Entertainment Inc. from August 2008 to January 2010. Ms. Irvine
holds a B.S. in Accounting from Illinois State University and an M.S. in
Taxation from Golden Gate University. The Nominating Committee believes Ms.
Irvine should serve on the Board due to her financial expertise and extensive
experience in public company management.
Max R.
Levchin is currently an investor in and
advisor to emerging technology companies. He has also served as Chief Executive
Officer of Affirm, Inc., a consumer financial services company, and Chief
Executive Officer of HVF, LLC, a startup innovation lab, since January 2012.
Previously, Mr. Levchin was Vice President of Engineering at Google, Inc., an
Internet search company, from August 2010 to August 2011. Prior to Google, Mr.
Levchin was founder and Chief Executive Officer of Slide, Inc., a developer of
social applications such as photo and video self-expression and social games,
from January 2005 to August 2010, when it was acquired by Google. Prior to
founding Slide, Mr. Levchin was Chief Technology Officer and a director at
PayPal from March 2000 to December 2002, when it was acquired by eBay. Mr.
Levchin co-founded Confinity Inc., an Internet and electronics company, in
December 1998, and served as the Chief Technology Officer and a director through
March 2000, when Confinity merged with X.com and became PayPal. Mr. Levchin
founded NetMeridian Software, a developer of early palm-top security
applications, in January 1996, and served as Chief Executive Officer from
January 1996 to December 1998. Mr. Levchin currently serves on the board of
directors of Yahoo! Inc. He holds a B.S. in Computer Science from the University
of Illinois, Urbana-Champaign. The Nominating Committee believes Mr. Levchin
should serve on the Board due to his extensive background and experience in the
social media and Internet industries and as a seasoned entrepreneur.
Mariam
Naficy has been the Chief Executive Officer
of Minted LLC, an online marketplace for independent design and art, since she
founded the company in June 2007. Prior to founding Minted, she was the general
manager of the e-commerce division of The Body Shop International plc, a
cosmetics retailer, from November 2003 to June 2007. She previously served as
Vice President, Marketing and Product Development of Movielink, LLC, a web-based
video on demand service, from April 2002 to May 2003, Interim Vice President of
Marketing for Columbia Tristar International Television, a television and
distribution and production company, from January 2002 to May 2002, and
co-founder and Chief Executive Officer of Eve.com, an online cosmetics retailer,
from June 1998 to October 2000, when it was acquired by Idealab. Ms. Naficy also
sits on the board of Every Mother Counts, a non-profit organization founded to
increase public awareness and support for improved maternal and child health.
She holds a B.A. in Political Economy from Williams College and an M.B.A. from
the Stanford University Graduate School of Business. The Nominating Committee
believes Ms. Naficy should serve on the Board due to her expertise in operating
and managing companies in the e-commerce sector.
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INFORMATION REGARDING THE BOARD AND
CORPORATE GOVERNANCE
INDEPENDENCE OF THE BOARD
Under the
NYSE listing standards, a majority of the members of a listed companys board of
directors must qualify as independent, as affirmatively determined by its
board of directors. The Board consults with our counsel to ensure that its
determinations are consistent with relevant securities and other laws and
regulations regarding the definition of independent, including those set forth
in pertinent listing standards of the NYSE, as in effect from time to time.
Consistent
with these considerations, after review of all relevant identified transactions
or relationships between each director, or any of his or her family members, and
the Company, our executive management and independent auditors, the Board has
affirmatively determined that the following seven directors are independent
directors within the meaning of the applicable NYSE listing standards: Mses.
Irvine and Naficy and Messrs. Anderson, Fenton, Gibbs, Levchin and Levine.
In making
these determinations, the Board found that none of these directors had a
material or other disqualifying relationship with the Company. It considered the
current and prior relationships that each non-employee director has with our
company and each other and all other facts and circumstances the Board deemed
relevant in determining their independence, including the beneficial ownership
of our capital stock by each non-employee director. Mr. Stoppelman, our Chief
Executive Officer, and Mr. Donaker, our Chief Operating Officer, are not
independent by virtue of their employment with the Company.
BOARD LEADERSHIP STRUCTURE
Our Board
currently has both an independent Chairman and Lead Independent Director:
Messrs. Levchin and Anderson, respectively. Mr. Levchin has authority, among
other things, to call and preside over Board meetings and, together with Mr.
Anderson, set meeting agendas. As a result of Mr. Levchins extensive history
with and knowledge of Yelp, he is able to provide valuable insight and help
ensure that the Board and management act with a common purpose. In our view,
having a Chairman far removed from management would have the potential to give
rise to divided leadership, which could interfere with good decision making or
weaken our ability to develop and implement strategy. Instead, we believe that
Mr. Levchins history with the Company makes him best positioned to act as a
bridge between management and the Board, facilitating the regular flow of
information and implementation of our strategic initiatives and business plans.
While the
Board believes that Mr. Levchins service as Chairman is appropriate and in the
best interests of the Company and our stockholders, it determined that it would
be beneficial to have a Lead Independent Director as well to reinforce the
independence of the Board in its oversight of our business and affairs. In
particular, the Board believes that having a Lead Independent Director to
complement a Chairman with an extensive history with the Company helps foster an
environment that is conducive to objective evaluation and oversight of
managements performance, increasing management accountability and improving the
ability of the Board to monitor whether managements actions are in the best
interests of the Company and our stockholders. Accordingly, the Board appointed
Mr. Anderson, an independent director with deep technology and financial
experience, as Lead Independent Director in November 2011. Under our Bylaws and
Corporate Governance Guidelines, the Lead Independent Director has authority,
among other things, to establish meeting agendas with the Chairman, preside over
and establish agendas for executive sessions of the independent directors and
preside over any portions of the meetings of the Board at which (i) the
evaluation or compensation of the Chief Executive Officer is presented or
discussed and (ii) the performance of the Board is presented or discussed.
Together, our
Chairman and Lead Independent Director have substantial ability to shape the
work of the Board. The Board believes that Mr. Levchins tenure with and
knowledge of Yelp, combined with Mr. Andersons significant experience on the
boards of directors of other public and private technology companies at various
stages of development, enhances the effectiveness of the Board as a whole.
MEETINGS OF THE BOARD
The Board met
five times during 2014. Each member of the Board attended at least 75% of the
aggregate number of meetings of the Board and of the committees on which he or
she served, held during the portion of 2014 for which he or she was a director
or committee member.
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INFORMATION REGARDING THE COMMITTEES
OF
THE
BOARD
The Board has
three standing committees: the Audit Committee, Compensation Committee and
Nominating Committee. The following table provides membership and meeting
information for 2014 for each of the Board committees:
Name |
|
Audit |
|
Compensation |
|
Nominating |
Max Levchin |
|
|
|
|
|
|
Fred Anderson |
|
![](yelp_def14a2x4x1a.jpg) |
|
![](yelp_def14a2x4x1a.jpg) |
|
|
Peter Fenton |
|
|
|
![](yelp_def14a2x4x2.jpg) |
|
|
Robert Gibbs |
|
![](yelp_def14a2x4x1a.jpg) |
|
|
|
|
Diane Irvine |
|
![](yelp_def14a2x4x2.jpg) |
|
|
|
|
Jeremy Levine |
|
|
|
|
|
(1) |
Mariam Naficy |
|
|
|
|
|
(1) |
Keith Rabois |
|
|
|
|
|
(1) |
Total meetings in
2014 |
|
9 |
|
5 |
|
2
|
____________________
![](yelp_def14a2x4x2a.jpg) |
Committee Chairperson |
|
|
![](yelp_def14a2x4x1a.jpg) |
Committee member |
|
|
(1) |
Mr. Rabois resigned
from the Nominating Committee in connection with his resignation from the
Board on January 17, 2014. The Board subsequently designated Mr. Levine as
Chair of the Nominating Committee and appointed Ms. Naficy as a member of
the Nominating Committee. |
Below is a
description of each committee of the Board. The Board has determined that each
member of each committee meets the applicable NYSE rules and regulations
regarding independence and that each member is free of any relationship that
would impair his or her individual exercise of independent judgment with regard
to Yelp.
Audit Committee
The Board
established the Audit Committee to oversee our corporate accounting and
financial reporting processes, systems of internal control over financial
reporting and audits of our financial statements, and the quality and integrity
of our financial statements and reports. For this purpose, the Audit Committee
performs several functions, including:
● |
reviewing and pre-approving the
engagement of our independent registered public accounting firm to perform
audit services and any permissible non-audit services;
|
● |
evaluating the performance of our
independent registered public accounting firm and deciding whether to
retain its services; |
● |
monitoring the rotation of
partners of our independent registered public accounting firm on our
engagement team as required by law; |
● |
reviewing our annual and
quarterly financial statements and reports and discussing the statements
and reports with our independent registered public accounting firm and
management, including a review of disclosures under Managements
Discussion and Analysis of Financial Condition and Results of Operations;
|
● |
conferring with management and
our independent registered public accounting firm regarding the scope,
adequacy and effectiveness of our internal control over financial
reporting; |
● |
considering and approving or
disapproving all related-party transactions; |
● |
reviewing, with our independent
registered public accounting firm and management, significant issues that
may arise regarding accounting principles and financial statement
presentation, as well as matters concerning the scope, adequacy and
effectiveness of our financial controls; |
● |
conducting an annual assessment
of the performance of the Audit Committee and its members, and the
adequacy of its charter; and |
● |
establishing procedures for the
receipt, retention and treatment of complaints received by us regarding
financial controls, accounting or auditing matters. |
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The Audit
Committee is currently composed of three directors, Ms. Irvine and Messrs.
Anderson and Gibbs, each of whom the Board has determined to be independent (as
independence is currently defined in Section 303A.02 of the NYSE listing
standards and in Rule 10A-3(b)(1) promulgated under the Exchange Act). The Board
has determined that Ms. Irvine and Mr. Anderson each qualify as an audit
committee financial expert, as defined in applicable SEC rules. The Board made
a qualitative assessment of Ms. Irvines and Mr. Andersons level of knowledge
and experience based on a number of factors, including their formal education
and experiences as described in their biographies included in this Proxy
Statement. Ms. Irvine is the Chair of the Audit Committee.
The Audit
Committee has adopted a written charter that is available to stockholders on our
website at www.yelp-ir.com under the section entitled Corporate Governance.
Audit Committee
Report(1)
The Audit
Committee has reviewed and discussed the audited financial statements for the
year ended December 31, 2014 with management of the Company. The Audit Committee
has discussed with the independent registered public accounting firm the matters
required to be discussed by Auditing Standard No. 16, Communications with Audit Committees,
as adopted by the Public Company Accounting Oversight Board, or PCAOB. The Audit
Committee has also received the written disclosures and the letter from the
independent registered public accounting firm required by applicable
requirements of the PCAOB regarding the independent accountants communications
with the Audit Committee concerning independence, and has discussed with the
independent registered public accounting firm the accounting firms
independence. Based on the foregoing, the Audit Committee has recommended to the
Board that the audited financial statements be included in the Companys Annual
Report on Form 10-K for the year ended December 31, 2014.
|
Respectfully submitted,
The Audit Committee of the Board of
Directors
Diane M. Irvine, Chair Fred
D. Anderson Robert Gibbs |
____________________
(1) |
The material in this report is
not soliciting material, is furnished to, but not deemed filed with,
the SEC and is not deemed to be incorporated by reference in any filing of
Yelp under the Securities Act or the Exchange Act, whether made before or
after the date hereof and irrespective of any general incorporation
language in any such filing. |
Compensation
Committee
The Board
established the Compensation Committee to oversee our compensation policies,
plans and programs, and to review and determine the compensation to be paid to
our executive officers and directors. The functions of the Compensation
Committee include:
● |
determining the compensation and
other terms of employment of our Chief Executive Officer and our other
executive officers and reviewing and approving corporate performance goals
and objectives relevant to such compensation, if
appropriate; |
● |
reviewing and recommending to the
full Board the compensation of our
directors; |
● |
evaluating, adopting and
administering the equity incentive plans, compensation plans and similar
programs advisable for us, as well as modification or termination of
existing plans and programs; |
● |
establishing policies with
respect to equity compensation
arrangements; |
● |
reviewing with management our
disclosures under the caption Compensation Discussion and Analysis and recommending to the full Board its inclusion in our periodic
reports to be filed with the SEC; and |
● |
reviewing and evaluating, at
least annually, the performance of the Compensation Committee and the
adequacy of its charter. |
Our
Compensation Committee is currently composed of two directors, Messrs. Fenton
and Anderson, each of whom the Board has determined to be independent under the
NYSE listing standards, a non-employee director as defined in Rule 16b-3 promulgated under the Exchange Act and an outside director
as that term is defined in Section 162(m) of the Internal Revenue Code of 1986,
as amended, or the Code. Mr. Fenton is the Chair of the Compensation Committee.
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The
Compensation Committee has adopted a written charter that is available to
stockholders on our website at www.yelp-ir.com under the section entitled
Corporate Governance. Under its charter, the Compensation Committee may form
and delegate authority to subcommittees as appropriate, including, but not
limited to, a subcommittee composed of one or more members of the Board to grant
stock awards under our equity incentive plans.
The specific
determinations of the Compensation Committee with respect to executive
compensation for 2014 and the Compensation Committee Report, as well as the
Compensation Committees processes and procedures and the role of our executive
officers in recommending and determining executive compensation, are described
in detail in the section of this Proxy Statement entitled Executive CompensationCompensation Discussion and
Analysis. Our compensation arrangements for
our non-employee directors are described under the section of this Proxy
Statement entitled Director
Compensation below.
Compensation Committee Interlocks
and Insider Participation
No member of
the Compensation Committee is currently or has been at any time one of our
officers or employees. None of our executive officers currently serve, or has
served during the last year, as a member of the board of directors or
compensation committee of any entity that has one or more executive officers
serving as a member of our Board or Compensation Committee.
Nominating Committee
The Board
established the Nominating Committee to oversee our corporate governance
functions. Specifically, the functions of the Nominating Committee include:
● |
reviewing periodically and evaluating director performance on our
Board and its applicable committees, and recommending to the Board and
management areas for improvement; |
● |
interviewing, evaluating, nominating and recommending individuals
for membership on our Board; |
● |
reviewing and recommending to our Board any amendments to our
corporate governance policies; and |
● |
reviewing and assessing, at least annually, the performance of the
Nominating Committee and its charter. |
The
Nominating Committee is currently composed of three directors, Messrs. Levine
and Levchin and Ms. Naficy, each of whom the Board has determined to be
independent under the NYSE listing standards. Mr. Rabois served as the Chair of
the Nominating Committee until January 17, 2014, when he resigned from the Board
and the Nominating Committee. The Board subsequently appointed Mr. Levine as
Chair of the Nominating Committee. The Board appointed Ms. Naficy to the
Nominating Committee on March 5, 2014.
The
Nominating Committee has adopted a written charter that is available to
stockholders on our website at www.yelp-ir.com under the section entitled
Corporate Governance.
The
Nominating Committee believes that candidates for director should have certain
minimum qualifications, including being able to read and understand basic
financial statements, being over 21 years of age and having the highest personal
integrity and ethics. The Nominating Committee also considers such factors as
possessing relevant expertise on which to be able to offer advice and guidance
to management, having sufficient time to devote to the affairs of the Company,
demonstrated excellence in his or her field, having the ability to exercise
sound business judgment and having the commitment to represent rigorously the
long-term interests of our stockholders. However, the Nominating Committee
retains the right to modify these qualifications from time to time. Candidates
for director are reviewed in the context of the current composition of the
Board, the operating requirements of the Company and the long-term interests of
the stockholders.
In conducting
this assessment, the Nominating Committee typically considers diversity, age,
skills and such other factors as it deems appropriate given the current needs of
the Board and the Company, to maintain a balance of knowledge, experience and
capability. In the case of incumbent directors whose terms of office are set to
expire, the Nominating Committee reviews such directors overall service to the
Company during their term, including the number of meetings attended, level of
participation, quality of performance and any other relationships and
transactions that might impair such directors independence. In the case of new
director candidates, the Nominating Committee also determines whether the
nominee is independent for NYSE purposes, which determination is based upon NYSE
listing standards, applicable SEC rules and regulations and the advice of
counsel, if necessary. The Nominating Committee meets to discuss and consider
candidates qualifications and then selects nominee(s) for recommendation to the
Board by majority vote.
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To identify
candidates for Board membership, the Nominating Committee uses its network of
contacts to compile a list of potential candidates, but may also engage, if it
deems appropriate, a professional search firm. The Nominating Committee conducts
any appropriate and necessary inquiries into the backgrounds and qualifications
of possible candidates after considering the function and needs of the Board.
At this time,
the Nominating Committee does not have a policy with regard to the consideration
of director candidates recommended by stockholders. The Nominating Committee
believes that it is in the best position to identify, review, evaluate and
select qualified candidates for Board membership, based on the comprehensive
criteria for Board membership approved by the Board.
ROLE OF THE BOARD IN RISK OVERSIGHT
Our Board
recognizes the importance of effective risk oversight in running a successful
business and in fulfilling its fiduciary responsibilities to Yelp and its
stockholders. While our management is responsible for the day-to-day management
of the risks that we face, the Board is responsible for overseeing our aggregate
risk profile and our risk management process, as well as ensuring that an
appropriate culture of risk management exists within the Company and setting the
right tone at the top.
The Board
believes that its current leadership structure facilitates its risk oversight
responsibilities. In particular, the Board believes an independent Chairman, the
Lead Independent Director, the majority-independent Board and independent Board
committees provide a well-functioning and effective balance to the members of
our executive management on the Board. Although the Board does not have a
standing risk management committee, it administers its oversight function
directly as well as through its standing committees that address risks inherent
in their respective areas of oversight. In particular, our Board is responsible
for monitoring and assessing strategic risk exposure, including a determination
of the nature and level of risk appropriate for the Company.
The Audit
Committee has the responsibility to consider and discuss our major financial
risk exposures and the steps our management has taken to monitor and control
these exposures, including guidelines and policies to govern the process by
which risk assessment and management are undertaken. Our Audit Committee also
monitors compliance with legal and regulatory requirements, in addition to
oversight of the performance of our internal audit function.
Our
Nominating Committee oversees risks related to our overall corporate governance,
including Board and committee composition, Board size and structure and director
independence, as well as succession planning for the Board and management. In
addition, the Nominating Committee monitors the effectiveness of our Corporate
Governance Guidelines and Code of Business Conduct and Ethics, including whether
they are successful in preventing illegal and improper liability-creating
conduct.
The
Compensation Committee assesses and monitors whether any of our compensation
policies and programs has the potential to encourage excessive risk taking. For
additional information regarding the Compensation Committees review of
compensation-related risk, please see the section of this Proxy Statement
entitled Executive CompensationCompensation
Risk Assessment.
Both the
Board as a whole and the various standing committees receive periodic reports
from executive management and our Head of Internal Audit, as well as incidental
reports as matters may arise. It is the responsibility of the committee chairs
to report findings regarding material risk exposures to the Board as
appropriate.
COMMUNICATIONS WITH THE BOARD
Stockholders,
and any other security holders of the Company or other interested parties, may
communicate with the Board at the following address:
The Board of
Directors
c/o Corporate Secretary
Yelp Inc.
140 New Montgomery Street, 9th Floor
San Francisco, CA
94105
Communications are distributed to the Board or to a particular director,
as appropriate, depending on the facts and circumstances outlined in the
communication. In addition, material that is unduly hostile, illegal or
similarly unsuitable will be excluded, with the provision that any communication
that is filtered out will be made available to any non-management director upon
request.
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CODE OF ETHICS
Our Board has
adopted a Code of Business Conduct and Ethics that applies to all officers,
directors and employees, including those officers responsible for financial
reporting. The Code of Business Conduct and Ethics is available on our website
at www.yelp-ir.com under the section entitled Corporate Governance. If we make
any substantive amendments to the Code of Business Conduct and Ethics or grant
any waiver of its provisions to any executive officer or director, we will
promptly disclose the nature of the amendment or waiver on our website.
CORPORATE GOVERNANCE GUIDELINES
In 2012, the
Board documented the governance practices followed by the Company by adopting
the Corporate Governance Guidelines to help ensure that the Board will have the
necessary authority and practice in place to review and evaluate our business
operations as needed to make decisions that are independent of our management.
The guidelines are also intended to align the interests of directors and
management with those of our stockholders. The Corporate Governance Guidelines
set forth the practices the Board intends to follow with respect to Board
composition and selection, Board meetings and involvement of executive
management, Chief Executive Officer performance evaluation and succession
planning, and Board committees and compensation. The Corporate Governance
Guidelines, as well as the charter of each committee of the Board, may be viewed
at our website at www.yelp-ir.com under the section entitled Corporate
Governance.
DIRECTOR COMPENSATION
The following
table shows, for the year ended December 31, 2014, certain information with
respect to the compensation of each of our non-employee directors.
Director Compensation for the Year
Ended December 31, 2014
|
Fees Earned or Paid |
|
Option Awards |
|
|
|
Name |
in Cash ($) |
|
($)(1)(2)(3) |
|
Total ($) |
Robert Gibbs |
25,000 |
|
|
|
|
25,000 |
|
Diane
Irvine |
30,000 |
|
|
|
|
30,000 |
|
Mariam Naficy |
20,834 |
|
519,236 |
|
|
540,070 |
|
____________________
(1) |
The amount in this column
represents the aggregate grant date fair value of a stock option award
granted during the year ended December 31, 2014 calculated in accordance
with Financial Accounting Standards Board Accounting Standards
Codification Topic 718, or ASC 718. Assumptions used in the calculation of
the grant date fair value are set forth in Note 12, Stockholders Equity (Deficit) in our Annual Report on Form 10-K for the year ended
December 31, 2014. |
|
|
(2) |
Upon her appointment to the
Board, Ms. Naficy was granted an option to purchase 12,500 shares of Class
A common stock at an exercise price of $79.95 on January 31, 2014. 25% of the shares underlying such option vested on the
anniversary of the grant date, with the remaining shares vesting in equal
monthly installments over the subsequent three years. |
|
(3) |
The aggregate number of shares
subject to outstanding stock options held by each director listed in the
table above as of December 31, 2014 was as follows: (i) 35,000 shares of
Class A common stock for Mr. Gibbs; (iii) 10,000 shares of Class A common
stock and 25,000 shares of Class B common stock for Ms. Irvine; and (iii)
12,500 shares of Class A common stock for Ms. Naficy. No other
non-employee director held stock options as of December 31,
2014. |
Director Compensation
Arrangements
We have a
policy of reimbursing our directors for their reasonable out-of-pocket expenses
incurred in attending Board and Board committee meetings. Neither of our
employee directors receives additional compensation for his service on the
Board. In addition, given the value of the investments made by funds affiliated
with certain of our non-employee directors, as well as the internal policies of
certain of those funds, we have not historically provided non-employee directors
who are affiliated with an institutional or venture investor of the Company with
compensation for their service on the Board. However, recognizing that our
venture investors have disposed of their holdings of Yelp stock,
the Board may revisit this policy in the future. Under our current policy, Ms.
Irvine, Ms. Naficy and Mr. Gibbs are eligible to receive compensation for their
Board and Board committee services.
14
Table of
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Cash
Compensation. We currently provide the
following cash compensation for Board and Board committee services, as
applicable, to non-employee directors who are not affiliated with an
institutional or venture investor of the Company:
● |
$20,000 per year for service as a Board member;
|
● |
$10,000 per year for service as the Chair of the Audit Committee or
Compensation Committee; |
● |
$5,000 per year for service as a member of the Audit Committee or
Compensation Committee (other than as chair) or chair of any other
committee; and |
● |
$2,500 per year for service as a member of any other committee
(other than as chair). |
Equity
Compensation. Each non-employee director who
is not affiliated with an institutional or venture investor of the Company is
also currently entitled to receive an option to purchase 10,000 shares of our
Class A common stock every other year on the date of our annual meeting of
stockholders. Each such option will vest in equal monthly installments over four
years following the date of grant. In addition, any new chair of the Audit
Committee (if a new director) will also receive an option grant of 25,000 shares
of Class A common stock. The option will vest over four years, with 25% vesting
on the one-year anniversary of the date of grant and the remainder vesting on a
monthly basis thereafter. We grant stock options with an exercise price of not
less than the fair market value of our Class A common stock on the date of
grant. We do not have, nor do we plan to establish, any program, plan or
practice to time stock option grants in coordination with releasing material
non-public information.
15
Table of
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PROPOSAL NO. 2
RATIFICATION OF SELECTION OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Audit
Committee has selected Deloitte & Touche LLP as our independent registered
public accounting firm for the year ending December 31, 2015 and has further
directed that management submit the selection of our independent registered
public accounting firm for ratification by the stockholders at the Annual
Meeting. Deloitte & Touche LLP has audited our financial statements
beginning with those for the year ended December 31, 2007. Representatives of
Deloitte & Touche LLP are expected to be present at the Annual Meeting. They
will have an opportunity to make a statement if they so desire and will be
available to respond to appropriate questions.
Neither our
Bylaws nor other governing documents or law require stockholder ratification of
the selection of Deloitte & Touche LLP as our independent registered public
accounting firm. However, the Audit Committee is submitting the selection of
Deloitte & Touche LLP to the stockholders for ratification as a matter of
good corporate practice. If the stockholders fail to ratify the selection, the
Audit Committee will reconsider whether or not to retain that firm. Even if the
selection is ratified, the Audit Committee in its discretion may direct the
appointment of different independent auditors at any time during the year if
they determine that such a change would be in the best interests of the Company
and our stockholders.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
The following
table represents aggregate fees billed to us for the years ended December 31,
2014 and 2013 by Deloitte & Touche LLP, our independent registered public
accounting firm.
|
|
Year Ended December
31, |
|
|
2014 |
|
2013 |
|
|
(in thousands) |
Audit Fees(1) |
|
|
$ |
1,317 |
|
|
|
$ |
1,366 |
|
Audit-related
Fees(2) |
|
|
|
|
|
|
|
|
204 |
|
Tax Fees(3) |
|
|
|
160 |
|
|
|
|
85 |
|
Total
Fees |
|
|
$ |
1,477 |
|
|
|
$ |
1,655 |
|
____________________
(1) |
Audit Fees are fees
and expenses for the audit of our financial statements, review of interim
financial statements and services in connection with our statutory and
regulatory filings or engagements in those fiscal years. |
|
|
(2) |
Audit-related Fees are fees billed for the assurance and related services that are
reasonably related to the performance of the audit or review of our
financial statements and are not reported under Audit Fees. |
|
(3) |
Tax Fees are fees
billed for tax compliance, advice and planning. |
All fees
described above were pre-approved by the Audit Committee.
In connection
with the audit of our 2014 financial statements, we entered into certain
engagement agreements with Deloitte & Touche LLP that set forth the terms by
which Deloitte & Touche LLP will perform audit services for the Company.
These agreements are subject to alternative dispute resolution procedures.
PRE-APPROVAL POLICIES AND PROCEDURES
The Audit
Committee has adopted a policy and procedures for the pre-approval of audit and
non-audit services rendered by our independent registered public accounting
firm, Deloitte & Touche LLP. The policy generally pre-approves specified
services up to specified amounts. Pre-approval may also be given as part of the
Audit Committees approval of the scope of the engagement of the independent
auditor or on an individual, explicit, case-by-case basis before the independent
auditor is engaged to provide each service. The Audit Committee has delegated to
the Chair of the Audit Committee the authority to grant interim pre-approvals of
audit services, provided that any such pre-approvals are required to be
presented to the full Audit Committee at its next scheduled meeting.
The Audit
Committee has determined that the rendering of the services other than audit
services by Deloitte & Touche LLP is compatible with maintaining the
principal accountants independence.
16
Table of
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REQUIRED VOTE
The
affirmative vote of the holders of shares representing a majority of the voting
power of the shares present in person or represented by proxy and entitled to
vote at the Annual Meeting will be required to ratify the selection of Deloitte
& Touche LLP.
THE BOARD RECOMMENDS
A VOTE IN FAVOR
OF
PROPOSAL NO. 2
17
Table of
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PROPOSAL NO. 3
ADVISORY VOTE ON EXECUTIVE COMPENSATION
The Board has
adopted a policy of soliciting a non-binding advisory vote on the compensation
of our named executive officers, commonly referred to as a say-on-pay vote,
every year in accordance with the preference previously indicated by our
stockholders. Accordingly, this year we are again asking the stockholders to
approve, on an advisory basis, the compensation of our named executive officers
as disclosed in this Proxy Statement in accordance with SEC rules. This vote is
not intended to address any specific item of compensation, but rather the
overall compensation of our named executive officers and the philosophy,
policies and practices described in this Proxy Statement.
Our executive
compensation program emphasizes teamwork and long-term value creation through a
philosophy of maintaining internal pay equity, tying a meaningful portion of
compensation to the long-term value of our business and establishing responsible
pay practices that have a reasonable cost structure and do not encourage
unnecessary or excessive risk taking. Consistent with this philosophy, the
Compensation Committee has designed an executive compensation program that we
believe has been effective at achieving its objectives of:
● |
attracting and retaining
talented and experienced executive officers, whose knowledge, skills and
performance are critical to our success; |
● |
motivating these executive
officers to achieve our business objectives; |
● |
aligning the interests of our
executive officers with those of our stockholders;
and |
● |
promoting teamwork while also
recognizing the role that each executive officer plays in our
success. |
As described
in detail under the heading Executive
CompensationCompensation Discussion and Analysis, equity compensation continued to be the principal component of our
executive compensation program in 2014. Equity awards to our named executive
officers directly link the most substantial component of their compensation to
the long-term success of our business and generally require continued service
over a multi-year period as a condition to vesting, which creates a strong
retention incentive and helps ensure the continuity of our operations. Although
our Compensation Committee did not grant new equity awards to our named
executive officers in 2014, as a result of the equity awards granted in 2013,
our named executive officers hold options covering a substantial number of
unvested shares that generally will not fully vest until 2017.
We believe
this program is reasonable in light of the executive compensation programs of
companies with whom we compete for talent and responsible in that it encourages
our executive officers to work for meaningful stockholder returns without
encouraging our executives to assume excessive risks. We encourage you to read
the Compensation Discussion and Analysis, compensation tables and related
narrative disclosures included in this Proxy Statement for additional details
about our executive compensation program.
The Board is
asking the stockholders to indicate their support for the compensation of our
named executive officers, as described in this Proxy Statement, by casting a
non-binding advisory vote FOR the following resolution:
RESOLVED, that the compensation paid to the Companys named
executive officers, as disclosed pursuant to the compensation disclosure rules
of the SEC, including the Compensation Discussion and Analysis, the compensation
tables and any related material disclosed in this Proxy Statement, is hereby
APPROVED.
Because the
vote is advisory, it is not binding on the Board or the Company. Nevertheless,
the views expressed by the stockholders, whether through this vote or otherwise,
are important to management and the Board and, accordingly, the Board and
Compensation Committee intend to consider the results of this vote in making
determinations in the future regarding executive compensation arrangements.
Advisory
approval of this Proposal No. 3 requires the vote of the holders of shares
representing a majority of the voting power of the shares present in person or
represented by proxy and entitled to vote at the Annual Meeting. Unless the
Board decides to modify its policy regarding the frequency of soliciting
advisory votes on the compensation of our named executive officers, the next
scheduled advisory vote will be at the 2016 Annual Meeting of Stockholders.
THE BOARD RECOMMENDS
A VOTE IN FAVOR
OF
PROPOSAL NO. 3
18
Table of
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SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following
table sets forth certain information regarding the ownership of our capital
stock as of March 1, 2015 by:
● |
each director and nominee for
director; |
● |
each of the executive officers
named in the Summary Compensation Table; |
● |
all executive officers and
directors of Yelp as a group; and |
● |
all those known by us to be
beneficial owners of more than five percent of our Class A common stock or
Class B common stock. |
Beneficial
ownership is determined according to the rules of the SEC and generally means
that the person has beneficial ownership if he, she or it possesses sole or
shared voting power of a security, including options that are currently
exercisable or exercisable within 60 days of March 1, 2015. Applicable
percentages are based on 64,943,261 shares of Class A common stock and 9,643,108
shares of Class B common stock outstanding on March 1, 2015. Shares subject to
options exercisable as of or within 60 days of March 1, 2015 are deemed to be
outstanding for computing the percentage ownership of the person holding such
options and the percentage ownership of any group of which the holder is a
member, but are not deemed outstanding for computing the percentage of any other
person.
This table is
based upon information supplied by our officers and directors, as well as our
review of Schedule 13Gs filed with the SEC. Except as indicated by footnote, and
subject to applicable community property laws, we believe that each person
identified in the table possesses sole voting and investment power with respect
to all capital stock shown to be held by that person. The address of each
executive officer and director, unless otherwise indicated by footnote, is c/o
Yelp Inc., 140 New Montgomery Street, 9th Floor, San Francisco,
California 94105.
|
|
Class A Common Stock |
|
Class B Common
Stock |
|
Percent of |
|
|
Number of |
|
Percent of |
|
Number of |
|
Percent of |
|
Total Voting |
Beneficial Owner |
|
Shares |
|
Total |
|
Shares |
|
Total |
|
Power |
Principal
Stockholders |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Jeremy
Stoppelman(1) |
|
|
295,325 |
|
|
|
* |
% |
|
|
|
5,606,516 |
|
|
|
50.5 |
% |
|
|
|
32.0 |
% |
|
Max Levchin(2) |
|
|
|
|
|
|
* |
|
|
|
|
4,476,794 |
|
|
|
46.4 |
|
|
|
|
27.7 |
|
|
Geoff
Donaker(3) |
|
|
242,012 |
|
|
|
* |
|
|
|
|
1,075,288 |
|
|
|
10.4 |
|
|
|
|
6.5 |
|
|
Wellington Management Group LLP(4) |
|
|
6,487,646 |
|
|
|
10.0 |
|
|
|
|
|
|
|
|
* |
|
|
|
|
4.0 |
|
|
The Vanguard
Group, Inc.(5) |
|
|
3,605,216 |
|
|
|
5.6 |
|
|
|
|
|
|
|
|
* |
|
|
|
|
2.2 |
|
|
Jackson Square Partners, LLC(6) |
|
|
3,275,577 |
|
|
|
5.0 |
|
|
|
|
|
|
|
|
* |
|
|
|
|
2.0 |
|
|
Named Executive Officers and Directors |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Jeremy Stoppelman(1) |
|
|
295,325 |
|
|
|
* |
|
|
|
|
5,606,516 |
|
|
|
50.5 |
|
|
|
|
32.0 |
|
|
Geoff
Donaker(3) |
|
|
242,012 |
|
|
|
* |
|
|
|
|
1,075,288 |
|
|
|
10.4 |
|
|
|
|
6.5 |
|
|
Rob Krolik(7) |
|
|
45,412 |
|
|
|
* |
|
|
|
|
47,855 |
|
|
|
* |
|
|
|
|
* |
|
|
Joseph
Nachman(8) |
|
|
109,710 |
|
|
|
* |
|
|
|
|
26,555 |
|
|
|
* |
|
|
|
|
* |
|
|
Laurence Wilson(9) |
|
|
139,317 |
|
|
|
* |
|
|
|
|
95,883 |
|
|
|
1.0 |
|
|
|
|
* |
|
|
Fred
Anderson |
|
|
|
|
|
|
* |
|
|
|
|
|
|
|
|
* |
|
|
|
|
* |
|
|
Peter Fenton(10) |
|
|
74,748 |
|
|
|
* |
|
|
|
|
|
|
|
|
* |
|
|
|
|
* |
|
|
Robert
Gibbs(11) |
|
|
22,812 |
|
|
|
* |
|
|
|
|
|
|
|
|
* |
|
|
|
|
* |
|
|
Diane Irvine(12) |
|
|
7,083 |
|
|
|
* |
|
|
|
|
21,354 |
|
|
|
* |
|
|
|
|
* |
|
|
Max
Levchin(2) |
|
|
|
|
|
|
* |
|
|
|
|
4,476,794 |
|
|
|
46.4 |
|
|
|
|
27.7 |
|
|
Jeremy Levine |
|
|
98,412 |
|
|
|
* |
|
|
|
|
|
|
|
|
* |
|
|
|
|
* |
|
|
Mariam
Naficy(11) |
|
|
3,906 |
|
|
|
* |
|
|
|
|
|
|
|
|
* |
|
|
|
|
* |
|
|
All executive officers and directors as a |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
group (12 persons)(13) |
|
|
14,407,176 |
|
|
|
21.9 |
|
|
|
|
11,350,245 |
|
|
|
95.2 |
|
|
|
|
69.2 |
|
|
____________________
|
Shares of Class B common stock
are convertible at any time by the holder into shares of Class A common
stock on a share-for-share basis, such that
each holder of shares of Class B common stock beneficially owns an
equivalent number of shares of Class A
common stock. |
|
|
19
Table of
Contents
|
Percentage total voting power
represents voting power with respect to all shares of our Class A and
Class B common stock, voting as a single class. Stockholders will be
entitled to one vote per share of Class A common stock and ten votes per
share of Class B common stock. The Class A common stock and Class B common
stock will vote together on all matters (including election of directors)
submitted to a vote of stockholders, except as may otherwise be set forth
in our Certificate of Incorporation or required by law. |
|
|
* |
Less than one
percent. |
|
(1) |
Consists of (a) 4,146,310 shares
of Class B common stock held by the Jeremy Stoppelman Revocable Trust,
over which Mr. Stoppelman retains sole voting and dispositive power, (b)
295,325 shares of Class A common stock issuable upon exercise of options
exercisable within 60 days of March 1, 2015 and (c) 1,460,206 shares of
Class B common stock issuable upon exercise of options exercisable within
60 days of March 1, 2015. |
|
(2) |
Consists of (a) 1,785,037 shares
of Class B common stock held directly by Mr. Levchin and (b) 2,691,757
shares of Class B common stock held by PENSCO Trust Company FBO Max
Levchin Roth IRA, over which Mr. Levchin retains voting and dispositive
power. |
|
(3) |
Consists of (a) 53,884 shares of
Class B common stock held directly by Mr. Donaker, (b) 342,708 shares of
Class B common stock held by Mr. Donakers family trust, over which Mr.
Donaker exercises voting and dispositive control, (c) 242,012 shares of
Class A common stock issuable upon exercise of options exercisable within
60 days of March 1, 2015 and (d) 678,696 shares of Class B common stock
issuable upon exercise of options exercisable within 60 days of March 1,
2015. |
|
(4) |
Based on information contained in
a Schedule 13G filed with the SEC on February 12, 2015, Wellington
Management Group LLP (Wellington) has shared voting power over 4,922,604
shares and shared dispositive power over 6,487,646 shares. The shares are
owned of record by clients of one or more investment advisers directly or
indirectly owned by Wellington. Those clients have the right to receive,
or the power to direct the receipt of, dividends from, or the proceeds
from the sale of, such shares. No such client is known to have such right
or power with respect to more than five percent of our Class A common
stock. The Schedule 13G filed by Wellington provides information only as
of December 31, 2014 and, consequently, the beneficial ownership of
Wellington may have changed between December 31, 2014 and March 1, 2015.
The address of Wellington is c/o Wellington Management Company LLP, 280
Congress Street, Boston, Massachusetts 02210. |
|
(5) |
Based on information contained in
a Schedule 13G filed with the SEC on February 10, 2015, the Vanguard
Group, Inc. (Vanguard), an independent advisor, has sole voting power
over 40,198 shares, sole dispositive power over 3,570,518 shares and
shared dispositive power over 34,698 shares. Vanguard Fiduciary Trust
Company, a wholly owned subsidiary of Vanguard, beneficially owns 34,698
shares as a result of its serving as investment manager of collective
trust accounts. Vanguard Investments Australia, Ltd., a wholly owned
subsidiary of Vanguard, beneficially owns 5,500 shares as a result of its
serving as investment manager of Australian investment offerings. The
Schedule 13G filed by Vanguard provides information only as of December
31, 2014 and, consequently, the beneficial ownership of Vanguard may have
changed between December 31, 2014 and March 1, 2015. The address of
Vanguard is 100 Vanguard Blvd., Malvern, Pennsylvania 19355. |
|
(6) |
Based on information contained in
a Schedule 13G filed with the SEC on February 11, 2015, Jackson Square
Partners, LLC (Jackson Square) has sole voting power over 2,281,109
shares, shared voting power over 994,468 shares and sole dispositive power
over 3,275,577 shares. The Schedule 13G filed by Jackson Square provides
information only as of December 31, 2014 and, consequently, the beneficial
ownership of Jackson Square may have changed between December 31, 2014 and
March 1, 2015. The address of Jackson Square is 101 California Street,
Suite 3750, San Francisco, California 94111. |
|
(7) |
Consists of (a) 27,543 shares of
Class B common stock, 16,284 shares of which were subject to a right of
repurchase held by the Company as of the date 60 days after March 1, 2015,
(b) 45,412 shares of Class A common stock issuable upon exercise of
options exercisable within 60 days of March 1, 2015 and (c) 20,312 shares
of Class B common stock issuable upon exercise of options exercisable
within 60 days of March 1, 2015. |
|
(8) |
Consists of (a) 49,644 shares of
Class A common stock, 39,304 shares of which were restricted stock units,
or RSUs, subject to vesting as of the date 60 days after March 1, 2015,
(b) 60,066 shares of Class A common stock issuable upon exercise of
options exercisable within 60 days of March 1, 2015 and (c) 26,555 shares
of Class B common stock issuable upon exercise of options exercisable
within 60 days of March 1, 2015. |
|
(9) |
Consists of (a) 61,706 shares of
Class A common stock, 39,304 shares of which were RSUs subject to vesting
as of the date 60 days after March 1, 2015, (b) 25,233 shares of Class B
common stock, (c) 77,611 shares of Class A common stock issuable upon
exercise of options exercisable within 60 days of March 1, 2015 and (d)
70,650 shares of Class B common stock issuable upon exercise of options
exercisable within 60 days of March 1,
2015. |
20
Table of
Contents
(10) |
Consists of shares held by Mr.
Fentons family trust, over which Mr. Fenton exercises voting and
dispositive control. |
|
|
(11) |
Consists of shares issuable upon
exercise of options exercisable within 60 days of March 1,
2015. |
|
(12) |
Consists of (a) 2,500 shares of
Class A common stock, (b) 4,583 shares of Class A common stock issuable
upon exercise of options exercisable within 60 days of March 1, 2015 and
(c) 21,354 shares of Class B common stock issuable upon exercise of
options exercisable within 60 days of March 1, 2015. |
|
(13) |
Consists of (a) 13,655,449 shares
of Class A commons stock, 78,608 shares of which were RSUs subject to
vesting as of the date 60 days after March 1, 2015, (b) 9,072,472 shares
of Class B common stock, 16,284 shares of which were subject to a right of
repurchase held by the Company as of the date 60 days after March 1, 2015,
(c) 751,727 shares of Class A common stock issuable upon exercise of
options exercisable within 60 days of March 1, 2015 and (d) 2,277,773
shares of Class B common stock issuable upon exercise of options
exercisable within 60 days of March 1, 2015. |
SECTION 16(A) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE
Section 16(a)
of the Exchange Act requires our directors and executive officers, and persons
who own more than ten percent of a registered class of our equity securities, to
file with the SEC initial reports of ownership and reports of changes in
ownership of our common stock and other equity securities. Officers, directors
and greater than ten percent stockholders are required by SEC regulation to
furnish us with copies of all Section 16(a) forms they file.
To our
knowledge, based solely on a review of the copies of such reports furnished to
us and written representations that no other reports were required, during the
year ended December 31, 2014, all Section 16(a) filing requirements applicable
to our officers, directors and greater than ten percent stockholders were
complied with, except that one report was filed late by each of Messrs.
Stoppelman, Donaker and Wilson due to an administrative error.
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Table of
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EQUITY COMPENSATION PLAN INFORMATION
The following
table provides certain information with respect to our current and former equity
compensation plans under which awards remained outstanding or available for
future grant as of December 31, 2014. Information is included for the Yelp Inc.
Amended and Restated 2005 Equity Incentive Plan, or the 2005 Plan, Yelp Inc.
2011 Equity Incentive Plan, or the 2011 Plan, Yelp Inc. 2012 Equity Incentive
Plan, as amended, or the 2012 Plan, and Yelp Inc. 2012 Employee Stock Purchase
Plan, or 2012 ESPP, each of which was adopted with the approval of our
stockholders.
|
|
|
|
|
|
|
|
|
|
|
Shares of Common Stock |
|
|
|
|
Shares of Common |
|
|
|
|
|
|
Available for Future |
|
|
|
|
Stock to be Issued |
|
Weighted-Average |
|
Issuance Under Equity |
|
|
|
|
Upon Exercise of |
|
Exercise Price of |
|
Compensation Plans |
|
|
|
|
Outstanding |
|
Outstanding |
|
(Excluding Securities |
|
|
Class of Common |
|
Options and Rights |
|
Options and Rights |
|
Reflected in Column (a)) |
Plan Category |
|
Stock |
|
(a) |
|
(b)(1) |
|
(c) |
Equity compensation plans approved by stockholders |
|
Class A |
|
|
6,948,619 |
(2) |
|
|
|
$ |
29.68 |
|
|
|
7,353,497 |
(4) |
|
Equity compensation plans approved by stockholders |
|
Class B |
|
|
3,652,877 |
(3) |
|
|
|
$ |
7.62 |
|
|
|
|
|
|
Total |
|
Class A
and Class B |
|
|
10,601,496 |
|
|
|
|
$ |
20.67 |
|
|
|
7,353,497 |
|
|
____________________
(1) |
The weighted average exercise price excludes RSU awards,
which have no exercise price. |
|
|
(2) |
Consists of options to purchase a total of 5,294,794
shares of Class A common stock and 1,653,825 shares of Class A common
stock subject to restricted stock unit awards under our 2012 Plan.
Excludes purchase rights currently accruing under our 2012 ESPP. For
offerings under the 2012 ESPP that began prior to December 1, 2014,
offering periods were 24-month periods comprised of four six-month
purchase periods and eligible employees could purchase shares of our Class
A common stock at a price equal to 85% of the lower of the fair market
value of our Class A common stock at the beginning of each offering period
or the end of each semi-annual purchase period. Beginning with the
offering commencing on December 1, 2014, an offering period consists of
one six-month purchase period and eligible employees may purchase shares
of our Class A common stock at a price equal to 85% of the fair market
value of our Class A common stock at the beginning of each offering
period. |
|
(3) |
Consists of options to purchase 578,708 shares of Class
B common stock under our 2011 Plan and options to purchase 3,074,169
shares of Class B common stock under our 2005 Plan. Shares of Class B
common stock are convertible at any time by the holder into shares of
Class A common stock on a share-for-share basis. |
|
(4) |
Consists of 5,394,830 shares of Class A common stock
reserved for issuance under the 2012 Plan and 1,958,667 shares of Class A
common stock reserved for issuance under the 2012 ESPP. |
|
|
The number of shares of our Class A common stock reserved for issuance under
our 2012 Plan will automatically increase on January 1 of each year through and including January 1, 2022 by 4.0% of
the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or a lesser
number of shares determined by the Board. Pursuant to this provision, the Board determined to increase the
number of shares reserved for issuance under the 2012 Plan by 1,458,411 shares of Class A common stock, representing
approximately 2.0% of the total number of shares of our capital stock outstanding on December 31, 2014, effective January 1,
2015. |
|
|
The number of shares of our Class A common stock
reserved for issuance under our 2012 ESPP will increase automatically each
year through and including January 1, 2022 by the least of (a) 2.0% of the
total number of shares of our capital stock outstanding on December 31 of
the preceding calendar year; (b) 5,000,000 shares of Class A common stock;
or (c) such lesser number as determined by the Board. The Board determined
not to increase the number of shares reserved for issuance under the 2012
ESPP on January 1, 2015. |
22
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EXECUTIVE OFFICERS
The names,
ages and certain other information concerning our executive officers as of March
23, 2015 are set forth below.
Name |
|
Age |
|
Position Held With the Company |
Jeremy Stoppelman |
|
37 |
|
Co-Founder and Chief Executive Officer |
Rob
Krolik |
|
46 |
|
Chief Financial
Officer |
Geoff Donaker |
|
42 |
|
Chief Operating Officer |
Joseph R.
(Jed) Nachman |
|
42 |
|
Senior Vice
President of Revenue |
Laurence Wilson |
|
42 |
|
Senior Vice President, Legal and User Operations, General Counsel
and Secretary |
Jeremy
Stoppelman. Biographical information
regarding Mr. Stoppelman is set forth under Proposal No. 1Election of Directors.
Rob
Krolik has served as our Chief Financial
Officer since July 2011. Prior to joining us, Mr. Krolik served as Chief
Financial Officer of Move, Inc., an online real estate company, from July 2009
to August 2011. Prior to Move, Mr. Krolik served in several roles, most recently
as Vice President, Global Finance Operations at eBay from September 2005 to July
2009. Prior to eBay, Mr. Krolik served as Vice President of Finance at
Shopping.com, Inc., a price comparison service company, from September 2004 to
September 2005, when it was acquired by eBay. Prior to Shopping.com, Mr. Krolik
held management roles at DigitalThink, Inc., an online learning company, from
March 2002 to May 2004, most recently as its Chief Financial Officer. Mr. Krolik
holds a B.B.A. from the University of Texas at Austin and is a certified public
accountant (inactive).
Geoff
Donaker. Biographical information regarding
Mr. Donaker is set forth under Proposal No.
1Election of Directors.
Jed
Nachman has served as our Senior Vice
President of Revenue since September 2011 and served as our Vice President of
Sales from January 2007 to September 2011. Prior to joining us, Mr. Nachman held
several senior sales roles for Yahoo! Inc., an Internet search company, from
January 2002 to January 2007, most recently as Director of Corporate Sales for
the Western Region for Yahoo! HotJobs. Prior to Yahoo!, Mr. Nachman served as
sales manager at HotJobs, an online job search company, from June 1999 to 2002,
when it was acquired by Yahoo!. Prior to HotJobs, Mr. Nachman was an associate
at Robertson Stephens, an investment bank, from 1996 to 1998. Mr. Nachman holds
a B.A. in Economics from the University of Colorado at Boulder.
Laurence
Wilson has served as our General Counsel
since November 2007 and as our Senior Vice President, Legal and User Operations
since September 2013. Prior to joining us, Mr. Wilson served as Vice President
of Legal and Business Development for Xoom Corporation from January 2004 to
October 2007. Mr. Wilson began his legal career with Claremont Partners, Inc., a
health care solutions company, from March 2002 to January 2004. He holds a B.A.
in History from the University of California, San Diego and a J.D. from Stanford
Law School.
EXECUTIVE COMPENSATION
COMPENSATION DISCUSSION AND ANALYSIS
Our
compensation discussion and analysis describes our executive compensation
program and the decisions in 2014 regarding compensation for our named executive
officers:
● |
Jeremy Stoppelman, our Chief
Executive Officer; |
● |
Rob Krolik, our Chief
Financial Officer; |
● |
Geoff Donaker, our Chief
Operating Officer; |
● |
Jed Nachman, our Senior Vice
President of Revenue; and |
● |
Laurence Wilson, our Senior
Vice President, Legal and User Operations, General Counsel and
Secretary. |
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Table of
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Executive Summary
During 2014,
we continued to transform the way people discover, engage and transact with
great local businesses. Highlights of our company performance in 2014 include:
● |
we generated net revenue of
$377.5 million, representing 62% growth over 2013, and achieved full-year
profitability for the first time; |
● |
cumulative reviews grew 35%
year-over-year to approximately 71 million at the end of
2014; |
● |
we continued to develop a
feature-rich experience by adding mobile review translations, our Message
the Business feature, which allows consumers to contact local businesses
directly, and the ability for consumers to upload short
videos; |
● |
we launched the Yelp for
Business Owners app, a product designed to make it easier for business
owners to engage with customers, and Yelp Reservations, a free tool that
allows businesses in the restaurant and nightlife categories to start
taking online reservations; |
● |
we expanded the Yelp Platform,
adding the ability for consumers to book spa and salon appointments, make
hotel bookings, make winery reservations and complete other transactions
without leaving Yelp; |
● |
we entered into strategic
partnerships with Yahoo!, to use Yelp content to power Yahoo Search in the
United States, and YP (formerly Yellow Pages), pursuant to which YP
business owner profile data will appear on our platform;
and |
● |
we increased the depth and
breadth of our European content through our acquisitions of Restaurant
Kritik, a German review website, and Cityvox SAS, a French review
website. |
Our
Compensation Committee believes that our executive compensation program is
appropriately designed to achieve its objectives, reasonable in light of the
executive compensation programs of companies with whom we compete for talent and
responsible in that it encourages our executive officers to work for meaningful
stockholder returns without encouraging them to assume excessive risks.
Highlights of our executive compensation program for 2014 include:
● |
Messrs. Stoppelman and Donaker
each continued to receive a nominal base salary of $1.00 per
year. |
● |
Our Compensation Committee
increased Mr. Nachmans base salary following the completion of his
secondment in the United Kingdom to bring it to a more market-competitive level and to be in
line with Messrs. Kroliks and Wilsons base salaries, reflecting our
internal pay equity. |
● |
Equity compensation remained
the principal component of our executive compensation program. After
reviewing their existing equity opportunities, including the unvested
portion of outstanding awards, our Compensation Committee determined that
each of our executive officers held substantial equity opportunities and
therefore did not make additional equity grants as part of our executive
officers 2014 compensation. |
● |
We do not maintain employment
agreements with our executive officers that contain multi-year guarantees
for salary increases, guaranteed bonuses or guaranteed equity
compensation. Our executives are employed at-will and are expected to
demonstrate high-quality performance in order to continue serving as
members of our executive team. |
● |
We offer reasonable change in
control and severance benefits to our executive officers, as customary in
our industry, with cash severance payments under these agreements not
exceeding the executives annual cash compensation (i.e. base salary plus
cash bonus amount, if any) at the time of termination. We do not provide
excise tax reimbursements or gross ups to our executive officers with
respect to benefits received in connection with a change in control or
termination event. |
● |
We provide few fringe benefits
to our executive officers and generally do not offer access to car
allowances, financial planning advice or club memberships. The perquisites
and benefits offered to our executive officers do not generally differ
from those that are provided on a broad basis to our employees. However,
in certain circumstances as our Compensation Committee determines
reasonable and necessary, our Compensation Committee has in the past, and may in the future, approve special
benefits to our executive officers, such as the payment of parking fees
and health insurance premiums for Messrs. Stoppelman and Donaker in
connection with the reduction of their salaries to a nominal amount, as
well as certain relocation benefits provided to Mr. Nachman in connection with the
completion of his secondment. |
Our Board and
Compensation Committee have also implemented a number of other corporate
governance policies and practices that were determined to be in the best
interest of our stockholders:
● |
In accordance with the
preference of our stockholders expressed in 2013, we conduct an annual
advisory vote on executive compensation, commonly referred to as a
say-on-pay vote. In our 2014 say-on-pay vote, our executive compensation
was approved by over 99% of the votes affirmatively cast on the proposal.
Based on this overwhelming support, our Compensation Committee decided to
maintain our current approach to executive compensation for our named
executive officers; |
● |
Our Compensation Committee is
composed solely of independent directors; |
24
Table of
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● |
Our Compensation Committee
utilizes an independent compensation consultant to provide market data and
engage in ongoing review of our executive compensation programs; these
inputs and data serve solely as guidelines to our Compensation Committee
in determining the components of our executive compensation program and
the amount of each component awarded to our executive
officers; |
● |
Our trading window policy
prohibits short sales, hedging transactions and other inherently
speculative transactions in our equity securities by our executive
officers; |
● |
Our Compensation Committee
generally reviews our executive compensation program on an annual basis to
ensure that we provide competitive compensation packages to attract,
retain and incentivize our executive management team to achieve success
for our business and our stockholders; and |
● |
Our Compensation Committee
regularly reviews our executive compensation program to ensure that it
strikes the appropriate balance of risk and reward in relation to our
overall business strategy and does not encourage excess or unnecessary
risk-taking behavior. |
Executive Compensation Philosophy,
Objectives and Design
Philosophy. We operate in a rapidly
evolving market. To succeed in this environment, we must continually refine our
business model, increase our traffic and revenue, manage the effectiveness of
our advertising solutions and attract new advertising clients, develop and
update our technology infrastructure, deploy new functions and products, expand
our business in new and existing markets, and partner with other companies.
To achieve
these business objectives, we need to attract and retain a highly talented team
of executives. We expect our team to possess and demonstrate strong leadership
and management capabilities, as well as foster our company culture, which is the foundation of our success and remains a pivotal part of our everyday
operations. We believe the best way to accomplish this through our compensation
program is to emphasize teamwork and long-term value creation through a
philosophy of:
● |
maintaining internal pay
equity the compensation paid to each executive should reflect the
importance of his role as compared to the roles of the other executive
officers, while at the same time providing a certain amount of parity to
promote teamwork; |
● |
tying a meaningful portion of
compensation directly to the long-term value and growth of our business
and total stockholder return; and |
● |
establishing responsible pay
practices that have a reasonable cost structure and do not encourage
unnecessary or excessive risk taking. |
Objectives. Our executive compensation
program is designed to achieve the following objectives:
● |
attract and retain talented
and experienced executive officers, whose knowledge, skills and
performance are critical to our success; |
● |
motivate the executive
officers to achieve our business objectives; |
● |
align the interests of our
executive officers with those of our stockholders;
and |
● |
promote teamwork while also
recognizing the role each executive plays in our
success. |
Design.
The total compensation package for our
executive team generally consists of:
● |
a base salary to compensate
employees for their day-to-day responsibilities, at levels that we feel
are necessary to attract and retain executive
talent; |
● |
grants under our equity
incentive compensation plans, including stock options and restricted stock
units; and |
● |
limited severance and change
in control benefits to encourage our executives to work to maximize
stockholder value. |
Compensation
is typically weighted towards equity, with limited cash compensation. Our
Compensation Committee believes that making equity awards a key component of
executive compensation focuses the executive team on the achievement of our
long-term strategic and financial goals, thereby aligning their interests with
those of our stockholders. We generally do not offer cash bonus opportunities to
our executive officers, as we believe that providing meaningful equity
opportunities motivates our executive officers to drive long-term value creation
while conserving cash.
25
Table of
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We do not
affirmatively set out in any given year, or with respect to any given new hire
package, to apportion compensation in any specific ratio between cash and
equity, or between long-term and short-term compensation. Rather, total
compensation may skew more heavily toward either cash or equity, or short-term
or long-term compensation, as a result of the factors described in the
paragraphs above and in greater detail below. Our Compensation Committee
continues to evaluate our executive compensation philosophy, objectives and
design, generally on an annual basis or more frequently as circumstances
require.
Compensation Setting
Process
Role of Our Compensation
Committee
Our
Compensation Committee is primarily responsible for executive compensation
decisions, including establishing our executive compensation philosophy and
programs, as well as determining specific compensation arrangements for each
executive. Our Compensation Committee generally reviews our compensation
programs and individual executive compensation arrangements on an annual basis.
In the fourth quarter of 2013, in anticipation of making executive compensation
decisions for 2014, our Compensation Committee conducted a review of our
executive compensation program and related policies. As part of this review, and
in making individual compensation decisions for 2014, our Compensation Committee
considered the philosophy and objectives outlined above, together with one or
more of the following factors, as discussed in greater detail below:
● |
the experiences and
individual knowledge of the members of our Compensation Committee
regarding executive compensation, as we believe this approach helps us
compete in hiring and retaining the best possible talent while maintaining
a reasonable and responsible cost structure; |
|
|
● |
the recommendations
of our executive management; |
|
|
● |
corporate and
individual performance, as we believe this encourages our executive
officers to focus on achieving our business objectives; |
|
|
● |
solely as a guide
and not as a determinative factor, various market data presented by
Compensia, our Compensation Committees independent compensation
consultant, to ensure that the compensation of our executive officers
remains competitive and that we are meeting our retention
objectives; |
|
|
● |
each executive
officers existing equity awards and stock holdings (including the
unvested portions); and |
|
|
● |
the potential
dilutive effect of equity awards on our
stockholders. |
Role of
Management
Our
Compensation Committee works closely with members of our executive management,
and our Chief Financial Officer in particular, to manage and develop our
executive compensation program, including reviewing existing compensation for
adjustment (as needed) and establishing new hire packages. Our finance and human
resources departments work with our Chief Financial Officer to gather financial
and operational data which may include information related to each executives
job duties, company-wide pay levels and benefits, current cash constraints, each
executive officers current equity award holdings, shares available for grant
under our equity plans and Company and individual accomplishments, as
appropriate that management reviews in making its recommendations.
From time to
time, our Chief Financial Officer and other members of our executive management
attend meetings (or portions of meetings) of the Compensation Committee to
present information and answer questions. Members of our human resources and
legal departments also attend Compensation Committee meetings. Our Compensation
Committee meets in executive session when appropriate to discuss and determine
the compensation for each executive officer. Neither our Chief Executive Officer, Chief Financial Officer
nor any other member of management participates in any deliberations of our
Compensation Committee regarding executive compensation and no executive officer
voted in or was present during the final determinations regarding the amount of
any component of his own compensation package or of any other executive
officers compensation package.
Say-on-Pay Vote in
2014
In accordance
with the preference indicated by our stockholders in 2013, we held an advisory
vote on the compensation of our named executive officers in 2014. Our
Compensation Committee considers the views of our stockholders as expressed in
the outcome of each such advisory vote in determining executive compensation
levels. At our 2014 Annual Meeting of Stockholders, over 99% of the votes
affirmatively cast were voted in favor of the say-on-pay proposal approving the
compensation of our named executive officers. Our Compensation Committee viewed
the results of this vote as broad general stockholder support for our executive
compensation program. Based on this result and its ongoing review of our
compensation practices, our Compensation Committee believes that our executive
compensation program has been effective in implementing our compensation
philosophy and objectives. Accordingly, our Compensation Committee determined
not to make any significant changes to our executive compensation program in
2014 following the vote, or for 2015. Nevertheless, our Compensation Committee
recognizes that pay practices continue to evolve, and so will continue to refine
our executive compensation program in its ongoing effort to ensure that our
executive compensation reflects our compensation philosophy and objectives, as
well as supports long-term value creation and our company culture.
26
Table of
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Role of Compensation Consultant
and Use of Market Data
Our executive
compensation program is designed to attract and retain talented and experienced
executive officers in an extremely competitive market. As a result, our
Compensation Committee believes that it is important to be informed as to the
current practices of comparable public companies with which we compete for top
talent. To that end, our Compensation Committee typically reviews the executive
compensation practices of a public company peer group as a comparative framework
for our executive compensation program. In some instances, it may supplement
publicly available data from the peer company group with relevant published
survey sources.
Our
Compensation Committee has the authority under its charter to engage its own
advisors to assist in carrying out its responsibilities. Our Compensation
Committee typically engages an independent executive compensation consultant to
advise it on current market practices, and we expect that it will continue to do
so in the future to ensure that our executive compensation program is
competitive and aligned with our strategy. From time to time, representatives of
such consultants may attend meetings (or portions of meetings) of our
Compensation Committee to present information and answer questions.
2014
Compensation Analysis. In September 2013, our
Compensation Committee engaged Compensia to provide executive compensation
advisory services in preparation for its annual evaluation of our pay practices.
These services included recommending a peer company group and providing a
compensation analysis consisting of executive compensation data from these
companies most recent publicly available compensation disclosures. Compensia
recommended, and our Compensation Committee approved, the following peer company
group:
Angies List, Inc. |
|
Financial Engines, Inc. |
|
Proofpoint, Inc. |
|
ServiceNow, Inc. |
|
SPS Commerce, Inc. |
Cornerstone OnDemand, Inc. |
|
HomeAway, Inc. |
|
RealPage, Inc. |
|
Shutterstock, Inc. |
|
The Ultimate Software Group, Inc. |
CoStar Group, Inc. |
|
Imperva, Inc. |
|
Netsuite Inc. |
|
SolarWinds, Inc. |
|
Trulia, Inc. |
Demandware, Inc. |
|
Infoblox Inc. |
|
OpenTable, Inc. |
|
Splunk Inc. |
|
Zillow, Inc. |
In December
2013, Compensia provided a compensation analysis to our Compensation Committee
consisting of a detailed market assessment and retention analysis for each of
our named executive officers, as well as an overview of market trends. Compensia
based its analysis on market data for the peer group companies listed above,
supplemented by market data published in the Radford Technology Survey for
certain public and private companies with similar financial and industry
profiles to us and, as an additional reference point, certain companies that
were too large to be included as peer group companies, but that are considered
key talent competitors. Because market data for directly comparable positions to
each of our named executive officers is not available for each of our peer group
companies, our Compensation Committee determined that this supplementary market
data would enhance the relevance of Compensias analyses. The peer group
companies and supplemental companies generally met the following criteria:
|
|
|
|
Revenue Over |
|
Market |
|
|
Group |
|
Industries |
|
Previous Four Quarters |
|
Capitalization |
|
Other Criteria |
2014 Peer Companies |
|
Internet Software and |
|
$90M $410M |
|
$1B $6.7B(1) |
|
Annual revenue |
|
|
Services |
|
|
|
|
|
growth >10% |
|
|
|
|
|
|
|
|
|
|
|
Application and Systems |
|
|
|
|
|
Market cap ≥5x |
|
|
Software |
|
|
|
|
|
annual revenue |
|
|
|
|
|
|
|
|
|
Supplemental
Companies |
|
Internet |
|
$115M $800M |
|
$1B $13B(2) |
|
N/A |
|
|
Software |
|
|
|
|
|
|
____________________
(1) |
As of October 1,
2013 |
|
|
(2) |
As of November 1,
2013 |
27
Table of
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By comparison, at the time of the
Compensation Committees review, our net revenue over the previous four quarters
was approximately $203.5 million (representing approximately 68% year-over-year
growth) and our market capitalization was approximately $4.5 billion
(representing approximately 22x our net revenue).
All cash
compensation data used in the analysis reflected a three percent upward
adjustment from the compensation levels disclosed by such companies, which
Compensia applied to update the data for 2014. Compensia based this adjustment
factor on published trends and its experience in analyzing compensation trends.
Our Compensation Committee reviewed Compensias analysis and market data in its
evaluation of our executive compensation program for 2014, but did not benchmark
to any particular level.
2015
Compensation Analysis. Our Compensation
Committee reviews and updates our peer company group periodically to ensure that
it continues to reflect appropriately the market in which we compete for
talented executives. In this regard, in anticipation of making executive
compensation decisions for 2015, our Compensation Committee engaged Compensia
again in September 2014 to recommend updates to the peer company group and to
conduct a new assessment comparing the compensation of our executive management
team to compensation for similarly situated executives at such peer companies.
Based on Compensias recommendations, our Compensation Committee approved a peer
company group for 2015 reflecting our increased annual net revenue and market
capitalization. The updated peer company group consists of the following
publicly traded companies:
Concur Technologies, Inc. |
Financial Engines, Inc. |
Pandora Media, Inc. |
SolarWinds, Inc. |
The Ultimate Software |
Cornerstone OnDemand, Inc. |
GrubHub Inc. |
Proofpoint, Inc. |
Splunk Inc. |
Group, Inc. |
CoStar Group, Inc. |
HomeAway, Inc. |
ServiceNow, Inc. |
Tableau Software, Inc. |
Zillow, Inc. |
Demandware, Inc. |
NetSuite Inc. |
Shutterstock, Inc. |
Trulia, Inc. |
|
Independence Assessment. In March 2014
and again in March 2015, our Compensation Committee analyzed whether the work of
Compensia as a compensation consultant raised any conflict of interest, taking
into consideration the following factors: (i) that Compensia does not provide
any other services to us; (ii) the fees paid by us to Compensia represent less
than one percent of Compensias total revenue; (iii) Compensias policies and
procedures that are designed to prevent conflicts of interest; (iv) the absence
of any material business or personal relationship of Compensia or the individual
compensation advisors employed by the firm with any of our executive officers;
(v) the absence of any material business or personal relationship of the
individual compensation advisors with any member of our Compensation Committee;
and (vi) none of the individual compensation advisors employed by Compensia own
any shares of our stock. Our Compensation Committee has determined, based on its
analysis of the above factors, that the work of Compensia and the individual
compensation advisors employed by Compensia as compensation consultants to our
Compensation Committee has not created any conflict of interest and our
Compensation Committee is satisfied with the independence of Compensia. Our
Compensation Committee intends to continue to assess the independence of any of
our compensation advisors by reference to the foregoing factors, consistent with
applicable NYSE listing standards.
Executive Compensation Program
Components
Base Salary
We provide a
base salary as a fixed source of compensation for our executive officers,
allowing them a degree of certainty in the face of having a meaningful portion
of their compensation at risk in the form of equity awards with value
generally contingent on stock price appreciation. Our Compensation Committee
recognizes the importance of base salaries as an element of compensation that
helps to attract and retain highly qualified executive talent, particularly in
light of the absence of a cash bonus opportunity for our executive officers.
Our
Compensation Committee does not apply specific formulas in setting initial
salary levels or determining adjustments from year to year. Rather, our
Compensation Committee may consider a range of factors, including the
executives anticipated responsibilities and individual experience, our
Compensation Committee members experience and knowledge in compensating
similarly situated individuals at other companies, the value of the executive
officers existing equity awards, our then-current cash constraints, a general
sense of internal pay equity among our officers and negotiations with the
executive. Our Compensation Committee may also consider target total cash
compensation (i.e. base salary plus target annual incentive or bonus cash
compensation) for similarly situated executives at our peer group companies. Our
Compensation Committee generally believes target total cash compensation data to
be a more relevant measure of the market competitiveness of the cash
compensation paid to our executive officers than base salary data because we do
not offer cash incentive or bonus opportunities.
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Our
Compensation Committee generally reviews, and adjusts as necessary, base
salaries for each of our executive officers annually. In the fourth quarter of
2013, our Compensation Committee reviewed our executive officers base salaries
as part of its annual review of our executive compensation program.
Jeremy
Stoppelman and Geoff Donaker. Following their
request in 2013, our Compensation Committee approved a nominal base salary of
$1.00 per year for each of Messrs. Stoppelman and Donaker. As part of its annual
review of executive compensation, the Compensation Committee revisited whether
the lack of meaningful cash compensation for these executive officers was
appropriate and whether it would encourage excessive or unnecessary risk-taking
behavior. As was the case in 2013, a large portion of Messrs. Stoppelmans and
Donakers personal wealth continued to be tied directly to our stock price
performance, potentially encouraging them to emphasize short-term performance at
the expense of long-term value creation.
Our
Compensation Committee determined, however, that this potential risk continued
to be effectively addressed by the equity compensation awarded to Messrs.
Stoppelman and Donaker. Their equity awards consist of stock options subject to
staggered, long-term vesting schedules; accordingly, they realize value from
their awards only through the long-term appreciation of our stock price, thereby
mitigating the incentive for short-term risk taking in addition to serving as an
effective retention tool. The Compensation committee further noted that a
majority of the 90,000 shares of our Class A common stock covered by the
supplemental stock option granted to each of Messrs. Stoppelman and Donaker in
2013 remained unvested, and so continued to provide a medium-term incentive to
balance the lack of meaningful cash compensation.
Rob Krolik
and Laurence Wilson. Our Compensation
Committee decided not to increase Mr. Kroliks or Mr. Wilsons base salary for
2014 based on its determination that these officers existing base salaries,
taken together with the other elements of their compensation, provided
sufficient fixed compensation for retention purposes. In making this
determination, our Compensation Committee did not benchmark their salaries to
specific market levels, but did note that Messrs. Kroliks and Wilsons base
salaries each fell below the 25th percentile of target total cash
compensation levels reported in Compensias analysis for 2014. Although their
cash compensation remained comparatively low, our Compensation Committee
concluded that, in light of the substantial equity awards made in 2013, Messrs.
Kroliks and Wilsons total compensation was adequate.
Jed
Nachman. In April 2012, Mr. Nachman relocated
his permanent residence from the San Francisco Bay Area to London, England to
oversee the establishment of our first international sales office. In connection
with his relocation, we seconded Mr. Nachman to our wholly owned subsidiary Yelp
UK Ltd. pursuant to a Secondment Agreement, dated as of April 25, 2012, by and
between us and Mr. Nachman, or the Secondment Agreement. Mr. Nachman
continued to serve as our Senior Vice President of Revenue for the duration of
his secondment.
Under the
Secondment Agreement, Mr. Nachmans annual base salary was set at £187,126,
which represents $300,000 converted at the 2011 mean exchange rate of $0.623753
to £1.00. Mr. Nachman also received an annual cost of living adjustment of
£78,593 under the Secondment Agreement, bringing his annual fixed compensation
to £265,719. In addition, Mr. Nachman was entitled to certain other benefits
under the Secondment Agreement, as described in Employee Benefits below. The terms of
Mr. Nachmans compensation during his secondment, including the cost of living
adjustment, were the result of individual negotiations with him, but generally
reflected the benefits we typically provided to employees at that time when we
requested that they relocate abroad.
In May 2014,
the Compensation Committee approved, and we entered into, a letter agreement
with Mr. Nachman regarding the conclusion of his secondment, his return to the
United States and his continued employment with us upon his return, or
the Repatriation Agreement. Pursuant to the Repatriation Agreement, Mr.
Nachmans secondment terminated, and he resumed working directly for us
in the United States, effective June 16, 2014. As of that date, the terms of his
employment reverted to those set forth in his amended and restated offer letter,
dated February 3, 2012, and he was no longer entitled to the benefits provided
under the Secondment Agreement. Instead, Mr. Nachman is entitled to receive an
annual base salary of $325,000 and our standard U.S. benefits package,
as described in Employee
Benefits below. With Mr. Nachmans
$300,000-equivalent salary falling below the 25th percentile of
target total cash compensation levels reported in Compensias analysis for 2014,
our Compensation Committee approved this increase to bring Mr. Nachmans salary
to a more market-competitive level. Although Mr. Nachmans cash compensation
remained below the 25th percentile with the increase, our
Compensation Committee determined $325,000 to be adequate in light of the
substantial equity award Mr. Nachman received in 2013 and reflective of our
philosophy of internal pay equity.
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The following
table shows each named executive officers 2014 base salary compared to his 2013
base salary:
|
|
2013 Base |
|
2014 Base |
|
Percentage |
Name |
|
Salary |
|
Salary |
|
Increase |
Jeremy Stoppelman |
|
|
$ |
1 |
|
|
|
|
$ |
1 |
|
|
|
|
0.00 |
% |
|
Rob
Krolik |
|
|
$ |
325,000 |
|
|
|
|
$ |
325,000 |
|
|
|
|
0.00 |
% |
|
Geoff Donaker |
|
|
$ |
1 |
|
|
|
|
$ |
1 |
|
|
|
|
0.00 |
% |
|
Jed
Nachman* |
|
|
$ |
300,000 |
|
|
|
|
$ |
325,000 |
|
|
|
|
8.33 |
% |
|
Laurence Wilson |
|
|
$ |
325,000 |
|
|
|
|
$ |
325,000 |
|
|
|
|
0.00 |
% |
|
____________________
* |
Mr. Nachman also received a cost
of living adjustment equal to approximately $122,926 in 2013 and
approximately $60,062 in 2014, each as converted to U.S. dollars. See the
Summary Compensation Table below. |
|
|
|
As converted to U.S. dollars. See
above discussion and Summary Compensation Table below. |
|
|
|
Effective from June 16,
2014. |
2015 Base
Salaries. In the first quarter of 2015, our
Compensation Committee reviewed our executive officers base salaries as part of
its annual review of our executive compensation program and decided not to make
any changes for 2015. In particular, the Compensation Committee determined that
it was appropriate to continue to honor Messrs. Stoppelmans and Donakers
requests for nominal base salaries. Using Compensias 2015 compensation
analysis as a reference point, the Compensation Committee also determined that
Messrs. Nachmans and Wilsons cash compensation is adequate at present. The
Compensation Committee also noted that Mr. Kroliks base salary was at a less
competitive level than either of Messrs. Nachmans or Wilsons compared to
similarly situated executives at our peer group companies. It determined,
however, to supplement his cash compensation with an equity award similar to
those supplementing Messrs. Stoppelmans and Donakers nominal base salaries, as
discussed under Equity
Compensation below, to maintain our focus on
equity compensation and internal pay equity.
Incentive Cash
Compensation
Historically,
we have not offered incentive cash compensation opportunities to our executive
officers. Our Compensation Committee revisited this practice in setting 2014 and
2015 compensation, but decided not to offer incentive cash compensation
opportunities to any executive officer at such times. Our Compensation Committee
also elected not to pay any bonus compensation for 2014. Although our
Compensation Committee recognized that incentive and bonus cash compensation is
a common compensation element at many companies, including companies with whom
we compete for talent, it continues to believe that the equity compensation
opportunities held by our executives provide sufficient motivation and retention
incentives at this time. Our Compensation Committee also feels it is
appropriate, given the broader economic environment, to conserve our cash
resources and rely on base salary and equity compensation rather than incentive
or bonus cash compensation.
Equity
Compensation
Historically,
we have primarily used stock options as the principal component of our executive
compensation program. Consistent with our compensation objectives, we believe
this approach has allowed us to attract and retain key talent in our industry
and aligned our executive teams focus and contributions with our long-term
interests and those of our stockholders. We grant stock options with an exercise
price not less than the fair market value of our Class A common stock on the
date of grant, so these stock options will have value to our executive officers
only if the fair market value of our common stock increases after the date of
grant and our executive officers continue in service through the applicable
vesting terms. Typically, stock options granted to our executive officers vest
over four years, allowing them to serve as an effective retention tool. As
discussed below, the Compensation Committee began granting restricted stock
units to executive officers in 2015, which also vest over four years.
In
determining the form, size and material terms of executive equity awards, our
Compensation Committee may consider, among other things, the executive officers
total compensation opportunity, the need to create a meaningful opportunity for
reward predicated on the creation of long-term stockholder value, the need to
attract and retain employees in the absence of a cash bonus program,
recommendations of our executive management, equity awards to similarly situated
executives at our peer group companies, individual accomplishments, any recent
changes to the executives job duties, the executive officers existing equity
award holdings (including the unvested portion of such awards), the retention
implications of existing grants and our incentive goals, internal pay equity
among our executive officers and market conditions.
2014. In the fourth quarter of 2013,
our Compensation Committee decided that each executive officers existing rights
and opportunities would provide sufficient compensation opportunities and
motivation through 2014. In making this determination, our Compensation
Committee used the market data included in the 2014 Compensia analysis as a general
guideline, but principally relied on the experience of its members in
compensating executives at similarly situated companies. Our Compensation
Committee noted that, as a result of the stock option grants made in 2013, each
executive officer held options covering a substantial number of unvested shares
that generally would not fully vest for another three years. Accordingly, our
Compensation Committee did not make any equity awards to our executive officers
at that time.
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2015. In the first quarter of 2015,
our Compensation Committee reviewed the then-current equity compensation
opportunities and holdings of each of our executive officers. Based on this
review, our Compensation Committee determined that new equity awards would be
appropriate to adequately meet our long-term retention goals and provide
sufficient incentive opportunities. However, in light of the large stock-based
compensation expense associated with certain equity awards, our Compensation
Committee determined it would be advisable to grant awards to Messrs. Nachman
and Wilson in 2015 and revisit Messrs. Stoppelman, Krolik and Donaker in
subsequent years.
Using the
2015 compensation analysis from Compensia as a general guideline, our
Compensation Committee granted Messrs. Nachman and Wilson each a new stock
option award and restricted stock unit award, in the amounts set forth in the
table below. The size of these awards reflects our Compensation Committees
determination of the need to provide substantial equity opportunities to
motivate our executive officers to achieve our business objectives in the
absence of cash incentive opportunities. The Compensation Committee elected to
split the awards between stock options and restricted stock units to reflect our general practice with respect to refresh grants for employees at the
director level and above, which it adopted in 2014 and is intended to mitigate
the effects of the extreme volatility in our stock price. Each of these awards to Messrs. Nachman and Wilson
vests over four years, with 10% vesting over the first year following the grant
date, 20% vesting over the second year, 30% vesting over the third year and 40%
vesting over the fourth year. Our Compensation Committee determined that this
vesting schedule, which is generally applicable to non-executive employee
refresh equity awards as well, would appropriately address our long-term retention
goals for Messrs. Nachman and Wilson.
Using the
2015 peer group market data solely as a reference, our Compensation Committee
also granted in the first quarter of 2015 stock option awards covering the number of shares of Class A common
stock set forth in the table below to Messrs. Stoppelman, Krolik and Donaker,
which vest monthly over the two years following the grant date. Our Compensation
Committee determined that these awards would be appropriate to balance the lack
of meaningful cash compensation for Messrs. Stoppelman and Donaker, given that
the similar grants made to them in 2013 were now fully vested. Similarly, the
Compensation Committee granted a stock option award to Mr. Krolik in lieu of an increase in
base salary as noted above. With their shorter vesting period and equal monthly
vesting installments, our Compensation Committee designed these awards to
provide a medium-term incentive linked to our stock performance.
|
|
Shares Issuable |
|
Shares Subject to |
|
|
upon Exercise of |
|
2015 Restricted |
Name |
|
2015 Option Grants |
|
Stock Unit Awards |
Jeremy Stoppelman |
|
|
32,600 |
|
|
|
|
|
Rob
Krolik |
|
|
3,300 |
|
|
|
|
|
Geoff Donaker |
|
|
26,100 |
|
|
|
|
|
Jed
Nachman |
|
|
24,450 |
|
|
|
40,311 |
|
Laurence Wilson |
|
|
24,450 |
|
|
|
40,311 |
|
Post-Employment and Change in
Control Compensation
In January
2012, our Compensation Committee approved our Executive Severance Benefit Plan,
or the Severance Plan, which provides that our named executive officers are
eligible to receive certain cash severance upon an involuntary termination
without cause (including a constructive termination), subject to signing a
release of claims and compliance with continuing obligations of confidentiality.
If such involuntary termination occurs on or within 12 months following a change
in control (as defined in the Severance Plan), the Severance Plan also provides
for limited accelerated vesting of certain equity awards. The Severance Plan did
not have any effect on pre-existing equity acceleration provisions. For a
summary of the equity acceleration provisions and the material terms and
conditions of the Severance Plan, see Compensation Plans and ArrangementsSeverance
Arrangements below.
Our
Compensation Committee believes, based on the experience of its members, that
such severance benefits are reasonable and allow our executive officers to focus
on pursuing business strategies that, while in the best interests of our
stockholders, may result in a disruption of their employment. Our Compensation
Committee has also determined that the limited benefits upon an involuntary
termination not in connection with a change in control provided for in the
Severance Plan are appropriate to encourage our executives to remain with us,
particularly in light of our dual-class capital structure, which makes a change
in control transaction less likely.
The terms of
certain stock option awards granted to Messrs. Stoppelman, Krolik and Donaker
prior to our initial public offering also provide for vesting acceleration in
connection with a change in control. See Compensation Plans and ArrangementsSeverance ArrangementsEquity
Awards below.
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Employee
Benefits
We provide
standard health, dental, vision, life and disability insurance benefits to our
executive officers on the same terms and conditions as provided to all other
eligible employees. Our executive officers may also participate in our
broad-based 401(k) plan, and in 2014 we began offering a company match of up to
$1,000 per year per employee, including executive officers. Messrs. Krolik,
Nachman and Wilson each received the full 401(k) company match in 2014. We
believe these benefits are consistent with the broad-based employee benefits
provided at the companies with whom we compete for talent and therefore are
important to attracting and retaining qualified employees. In addition, in 2014,
The Yelp Foundation, a non-profit organization established by the Board in
November 2011, offered to match donations to charitable organizations made by
our regular full-time employees of up to $1,000 per employee contribution. Each
of our executive officers participated in this matching program as detailed in
the notes to the Summary Compensation Table below.
We generally
do not offer many executive perquisites. However, from time to time, we may
consider providing limited perquisites to the extent our Compensation Committee
believes that these limited perquisites are important for attracting and
retaining key talent. For example, beginning in 2013 with the reduction of
Messrs. Stoppelmans and Donakers base salaries to a nominal amount, our
Compensation Committee approved payment of their monthly parking fees. Our
Compensation Committee also approved payment of the portion of Mr. Donakers
health insurance premium that ordinarily would have been deducted from his
paycheck (we already covered Mr. Stoppelmans entire premium under our standard
practices). The actual amounts received by Messrs. Stoppelman and Donaker in
2014 are set forth in the Summary Compensation Table below.
Similarly,
during the term of his secondment, Mr. Nachmans Secondment Agreement entitled
him to (i) four roundtrip plane tickets every 12 months to any location of his
choosing for his personal use, up to a maximum of $1,500 per ticket and (ii) a
stipend of £100 per month to cover gym and transit costs. We also provide Mr.
Nachman with tax equalization tax reimbursements or amounts paid to cover
additional taxes incurred by Mr. Nachman by reason of his secondment to ensure
his tax burden during his secondment is approximately the same as it would have
been had he remained in the United States and pay for the preparation of
required tax returns and tax equalization settlement calculations during his
secondment.
The
Secondment Agreement also provided that Mr. Nachman would receive moving cost
reimbursements up to $9,000 in 2014 if and when he returned to the San Francisco
Bay Area upon completion of his secondment (provided he remained employed by
us). However, the Repatriation Agreement provided for relocation benefits in
lieu of those provided in the Secondment Agreement, as follows: (i) one paid
consultation with a tax preparer prior to his return; (ii) certain moving
expenses; (iii) $2,000 for miscellaneous moving expenses; (iv) travel expenses
for him and his family from London to the United States; and (v) 30 days of
corporate housing upon his return. In addition, we will continue to pay for the
preparation of Mr. Nachmans tax returns and tax equalization settlement
calculations for tax years affected by his secondment in accordance with our tax
equalization policy. The actual amounts received by Mr. Nachman in 2013 and 2014
are set forth in the Summary Compensation Table below. Although the final terms
of Mr. Nachmans compensation during his secondment and in connection with his
return were the result of individual negotiations with him, they generally
reflect benefits we typically provide to employees we request to relocate
abroad.
Other Compensation
Policies
Stock
Ownership Guidelines. We have not set
specific equity ownership guidelines. However, we encourage our executive
officers to hold a significant equity interest in our stock and, as detailed in
Security Ownership of Certain Beneficial
Owners and Management, our executive
officers collectively owned approximately 6.3% of our stock as of March 23,
2015.
Equity
Grant Policy. We do not have, nor do we plan
to establish, any program, plan or practice to time stock option grants in
coordination with releasing material non-public information. We have adopted a
policy regarding the timing of the grant of equity awards that provides, among
other things, that the date for equity awards approved by written consent will
generally be the first business day of the month following the month in which
the consent is effective.
Short Sale
and Hedging Policy. Our trading window policy
prohibits short sales, hedging transactions and other inherently speculative
transactions in our equity securities by our executive officers and Board
members, among others.
Compensation Recovery Policies. To
date, we have not offered cash incentive or bonus opportunities to our executive
officers. Accordingly, our Board and Compensation Committee have not determined
whether they would attempt to recover bonuses from our executive officers if the
performance objectives that led to the bonus determination were to be restated,
or found not to have been met to the extent originally believed by our
Compensation Committee. However, as a public company subject to the provisions
of Section 304 of the Sarbanes-Oxley Act of 2002, if we are required as a result
of misconduct to restate our financial results due to our material
non-compliance with any financial reporting requirements under the federal
securities laws, our Chief Executive Officer and Chief Financial Officer may be
legally required to reimburse us for any bonus or other incentive-based or
equity-based compensation they receive. In addition, we will comply with the
requirements of the Dodd-Frank Act and will adopt a compensation recovery policy
once final regulations on the subject have been adopted.
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Tax and Accounting
Considerations
Deductibility of Executive Compensation. Section 162(m) of the Code limits the amount that a public company may
deduct from federal income taxes for remuneration paid to named executive
officers (other than the chief financial officer) to $1,000,000 per executive
officer per year, unless certain requirements are met. Section 162(m) provides
an exception from this deduction limitation for certain forms of
performance-based compensation, including the gain recognized by executive
officers upon the exercise of qualifying compensatory stock options. While our
Compensation Committee is mindful of the benefit to us of the full deductibility
of compensation, our Compensation Committee believes that it should not be
constrained by the requirements of Section 162(m) where those requirements would
impair flexibility in compensating our executive officers in the manner designed
to best promote our corporate objectives. The Compensation Committee has not yet
established a policy for determining which forms of incentive compensation
awarded to executive officers will be designated to qualify as
performance-based compensation. To maintain flexibility in compensating our
executive officers in a manner designed to best promote our objectives, we have
not adopted a policy that requires all compensation to be deductible. We intend
to compensate our executive officers in a manner consistent with the best
interests of the Company and our stockholders.
Taxation
of Parachute Payments and Deferred Compensation. Sections 280G and 4999 of the Code provide that executive officers and
directors who hold significant equity interests and certain other service
providers may be subject to an excise tax if they receive payments or benefits
in connection with a change in control that exceeds certain prescribed limits,
and that the company, or a successor, may forfeit a deduction on the amounts
subject to this additional tax. Section 409A of the Code also imposes additional
significant taxes on the individual in the event that an executive officer,
director or other service provider receives deferred compensation that does
not meet the requirements of Section 409A of the Code. We have not historically, and did not in 2014, provide any
executive officer, including any named executive officer, with a gross up or
other reimbursement payment for any tax liability that he might owe as a result
of the application of Sections 280G, 4999 or 409A of the Code, and we
have not agreed, and are not otherwise contractually obligated to provide, any
named executive officers with such a gross up or other reimbursement in
connection with such taxes.
Accounting
Treatment. The accounting impact of our
compensation programs is a factor that the Compensation Committee considers in
determining the size and structure of our programs to ensure that our
compensation programs are reasonable and in the best interests of the
stockholders.
COMPENSATION COMMITTEE REPORT(1)
The
Compensation Committee has reviewed and discussed with management the
Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K
and contained in this Proxy Statement. Based on such review and discussion, our
Compensation Committee has recommended to the Board that the Compensation
Discussion and Analysis be included in this Proxy Statement and incorporated
into our Annual Report on Form 10-K for the year ended December 31, 2014.
Respectfully
submitted, |
The
Compensation Committee of the Board of Directors |
|
Peter Fenton,
Chair |
Fred
Anderson |
____________________
(1) |
The material in this report is
not soliciting material, is furnished to, but not deemed filed with,
the SEC and is not deemed to be incorporated by reference in any filing of
Yelp under the Securities Act or the Exchange Act, other than our Annual
Report on Form 10-K, where it shall be deemed furnished, whether made
before or after the date hereof and irrespective of any general
incorporation language in any such filing. |
COMPENSATION RISK ASSESSMENT
Over the
course of the fourth quarter of 2014 and first quarter of 2015, in connection
with its annual review of our compensation programs, the Compensation Committee,
assisted by our management, conducted a risk assessment review of our
compensation policies and practices. Based on its review, the Compensation
Committee concluded that our compensation programs are designed with an
appropriate balance of risk and reward in relation to our overall business
strategy and do not create risk that is reasonably likely to have a material
adverse effect on the Company. In making this determination, the Compensation
Committee considered our pay mix, base salaries, the attributes of our variable
compensation programs, including our equity program and our sales compensation
plans, as well as our alignment with market pay levels and compensation program
designs.
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In
particular, the Compensation Committee believes the structure of our
compensation program for executive officers does not encourage excessive or
unnecessary risk-taking behavior. The base salary component does not encourage
risk taking because it is a fixed amount, and we do not offer incentive cash
compensation opportunities. In addition, as discussed in greater detail above,
the potential for Messrs. Stoppelmans and Donakers nominal base salaries to
encourage unnecessary risk taking is effectively mitigated by their equity
compensation opportunities. The principal component of our executive
compensation program has been long-term equity awards that help further align
our executive officers interests with those of our stockholders. The
Compensation Committee believes that these awards do not encourage unnecessary
or excessive risk taking because the ultimate value of the awards is tied to our
stock price and because awards are staggered and subject to long-term vesting
schedules to help ensure that executives have significant value tied to
long-term stock price performance.
SUMMARY COMPENSATION TABLE
The following
table shows compensation awarded to, paid to or earned by our named executive
officers for the years ended December 31, 2014, 2013 and 2012.
2014 Summary
Compensation Table
|
|
|
|
|
|
|
Option |
|
All Other |
|
|
|
Name |
|
Year |
|
Salary ($) |
|
Awards ($)(2) |
|
Compensation ($)(3) |
|
Total ($) |
Jeremy Stoppelman |
|
2014 |
|
1 |
|
|
|
|
|
|
|
66,912 |
(4) |
|
|
66,913 |
|
Chief Executive Officer |
|
2013 |
|
37,501 |
|
|
|
8,010,363 |
|
|
|
50,100 |
|
|
|
8,097,964 |
|
|
|
2012 |
|
300,000 |
|
|
|
|
|
|
|
40,657 |
|
|
|
340,657 |
|
Rob
Krolik |
|
2014 |
|
325,000 |
|
|
|
|
|
|
|
13,533 |
(5) |
|
|
338,533 |
|
Chief Financial Officer |
|
2013 |
|
321,875 |
|
|
|
2,674,826 |
|
|
|
10,847 |
|
|
|
3,007,548 |
|
|
|
2012 |
|
300,000 |
|
|
|
|
|
|
|
11,409 |
|
|
|
311,409 |
|
Geoff Donaker |
|
2014 |
|
1 |
|
|
|
|
|
|
|
23,231 |
(6) |
|
|
23,232 |
|
Chief Operating Officer |
|
2013 |
|
37,501 |
|
|
|
6,186,618 |
|
|
|
19,608 |
|
|
|
6,243,727 |
|
|
|
2012 |
|
300,000 |
|
|
|
|
|
|
|
11,371 |
|
|
|
311,371 |
|
Jed
Nachman |
|
2014 |
|
319,046 |
(1) |
|
|
|
|
|
|
300,435 |
(7) |
|
|
619,480 |
(8) |
Senior Vice President
of |
|
2013 |
|
292,681 |
|
|
|
2,674,826 |
|
|
|
194,698 |
(9) |
|
|
3,162,205 |
(8)(9) |
Revenue |
|
2012 |
|
298,250 |
|
|
|
|
|
|
|
189,669 |
|
|
|
487,920 |
(8) |
Laurence Wilson |
|
2014 |
|
325,000 |
|
|
|
|
|
|
|
8,233 |
(5) |
|
|
333,233 |
|
Senior Vice President, |
|
2013 |
|
321,875 |
|
|
|
2,674,826 |
|
|
|
6,544 |
|
|
|
3,003,245 |
|
General Counsel and
Secretary |
|
2012 |
|
300,000 |
|
|
|
|
|
|
|
5,983 |
|
|
|
305,983 |
|
____________________
(1) |
The amount
represents base salary earned in 2014, which consists of Mr. Nachmans
base salary under the Secondment Agreement for January 1 through June 15,
2014 and his base salary under the Repatriation Agreement for the
remainder of the year. See Compensation Discussion and AnalysisExecutive Compensation
Program ComponentsBase Salary
above. |
|
|
(2) |
The amounts
reported here do not reflect the actual economic value realized by our
named executive officers. In accordance with SEC rules, this column
represents the grant date fair value of shares underlying stock options,
calculated in accordance with ASC Topic 718. Assumptions used in the
calculation of the grant date fair value are set forth in Note 12,
Stockholders Equity
(Deficit) in our Annual Report on Form
10-K for the year ended December 31, 2014. |
|
(3) |
The amount
reported includes the following health, dental, vision, life and
disability insurance premiums paid by the Company on behalf of the named
executive officers in 2014: $5,512 for Mr. Stoppelman; $10,813 for Mr.
Krolik; $10,711 for Mr. Donaker; $16,421 for Mr. Nachman; and $5,513 for
Mr. Wilson. The amount also includes a matching charitable donation of
$1,000 made by The Yelp Foundation on behalf of each named executive
officer in 2014. These benefits are provided to the named executive
officers on the same terms as provided to all of our regular full-time
employees. |
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(4) |
The amount
reported also includes (a) $5,400 in monthly parking fees paid by the
Company and (b) $55,000 for personal administrative services performed by
Mr. Stoppelmans executive assistant. Because Mr. Stoppelmans executive
assistant is employed and paid by the Company to perform these services as
well as her services to the Company, the dollar amount of this benefit
represents the estimate of the aggregate incremental cost to the Company
of these services, based on the approximate amount of the executive
assistants regular time spent on Mr. Stoppelmans personal matters during
2014 as a percentage of her total time spent working for the Company
during 2014, multiplied by her base salary paid by the Company during
2014. |
|
|
(5) |
The amount
reported also includes (a) $720 in reimbursements for health club
membership and (b) $1,000 in Company-paid 401(k) plan matching
contributions, each of which was provided to the named executive officer
on the same terms as provided to all of our regular full-time
employees. |
|
(6) |
The amount
reported also includes (a) $5,400 in monthly parking fees paid by the
Company, (b) $720 in reimbursements for a health club membership, which
was provided to Mr. Donaker on the same terms as provided to all of our
regular full-time employees, and (c) $5,400 in health, dental, vision,
life and disability insurance premiums paid by the Company in addition to
the premiums covered under our standard practices applicable to all of our
regular full-time employees. |
|
(7) |
The amount
reported also includes $420 in reimbursements for a health club membership
and $1,000 in Company-paid 401(k) plan matching contributions, which were
provided to Mr. Nachman on the same terms as provided to all of our
regular full-time employees. |
|
|
The amount reported also
includes amounts paid pursuant to Mr. Nachmans Secondment Agreement, as
follows: (a) cost of living adjustment of $60,062; (b) tax equalization
payments of $168,969; (c) tax preparation payments of $15,240; and (d) a stipend of
$917 to cover transportation costs. Under the Secondment
Agreement, we will pay the difference between the taxes owed by Mr.
Nachman for 2014 and the taxes Mr. Nachman would have owed for 2014 had he
remained in the United States. The tax equalization payment reported above
represents (x) $183,176 in modified U.K. payroll taxes, paid by Yelp on
Mr. Nachmans behalf, plus (y) $27,043 in additional Medicare taxes on the
income imputed to Mr. Nachman as a result of our payment of such U.K.
payroll taxes, paid by Yelp on his behalf, minus (z) $41,250 withheld from
his salary during 2014 as an estimate of the taxes he would
have owed for 2014 had he remained in the United States. However, we will
not be able to make a final determination with respect to Mr. Nachmans
tax equalization for 2014 until both his U.S. and U.K tax returns for 2014
are finalized and, as a result, we may make additional tax equalization
and tax preparation payments at a later date. We expect Mr. Nachmans U.S.
tax return to be finalized by October 15, 2015, which is the extended
deadline to file 2014 tax returns, and his U.K. tax return to be finalized
by January 31, 2016, which is the deadline to file tax returns for the
taxable year running from April 6, 2014 to April 5, 2015. |
|
|
In addition, the
amount reported includes amounts paid pursuant to Mr. Nachmans Repatriation
Agreement, as follows: (A) $700 in payment for a one-time consultation
with a tax preparer, paid on his behalf; (B) $25,785 in moving expenses
paid on his behalf; (C) $2,000 for miscellaneous moving expenses; (D)
$3,921 in return travel expenses for Mr. Nachman and his family from
London to the United States; and (E) $4,000 for 30 days of paid corporate
housing upon his return to the United States. |
|
(8) |
Mr. Nachmans
base salary was paid in British pounds sterling from May 9, 2012 through
June 15, 2014. His cost of living adjustment and stipend for that period
were also paid in British pounds sterling. All such amounts were converted
using the interbank exchange rate in effect on the date of
payment. |
|
(9) |
Includes an
additional $6,980 of payments related to the preparation of Mr. Nachmans
2013 taxes for costs incurred after April 11, 2014, the date of our
Definitive Proxy Statement on Schedule 14A for our 2014 Annual Meeting of
Stockholders was filed with the SEC. |
COMPENSATION PLANS AND ARRANGEMENTS
Employment
Agreements
We entered
into amended and restated employment letter agreements with each of our
executive officers on February 3, 2012. The agreements do not provide for a
specific employment term and our executive officers are employed on an at-will
basis. The amended and restated employment letter agreements provide that our
executive officers are eligible to participate in our incentive compensation
programs, insurance programs and other employee benefit plans established by us,
including our Severance Plan.
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The executive
officers original offer letters provided for initial base salary, eligibility
to participate in our standard benefit plans and, in certain cases, initial
stock option grants, but did not provide for severance, other than for Mr.
Krolik, who was entitled to certain cash payments and equity acceleration in the
event of his involuntary termination of employment following a change in
control. Under the amended and restated agreements, however, our executive
officers are eligible to participate in our Severance Plan. With respect to Mr.
Krolik, the benefits available under the Severance Plan replaced the cash
severance protections included in his original offer letter. The amended and
restated agreements did not, however, modify the vesting or other terms of the
executive officers existing equity award agreements.
Severance
Arrangements
Severance
Plan. Each of our executives at the level of
vice president or above, including our named executive officers, who is deemed
to be an officer under Section 16 of the Exchange Act and selected by the Board
is eligible to participate in the Severance Plan.
Each eligible
participant who suffers an involuntary termination without cause or a
constructive termination will be eligible to receive, provided that he signs a
release of claims and complies with continuing obligations of confidentiality,
(i) a lump sum cash payment equal to one year of his then-current base salary,
(ii) a lump sum bonus payment equal to the actual cash bonus amount the
participant would have earned for the year in which the termination occurred, if
any, based on our actual performance, prorated for the period of active service,
and (iii) six months of company-paid health insurance coverage. In the event a
participant suffers an involuntary termination without cause or a constructive
termination in the same year as a change in control (as defined in the Severance
Plan), the lump sum bonus payment will be equal to the actual cash bonus amount
as if we had achieved all of the goals under the bonus plan in the year in which
the termination occurred and will not be pro-rated. Additionally, each
participant who experiences an involuntary termination without cause or a
constructive termination on or within 12 months following a change in control
will receive accelerated vesting of 50% of the number of their unvested shares
subject to each equity award held by such participant that was awarded after the
adoption of the Severance Plan.
These
benefits are subject to a best after-tax provision in the case where benefits
would trigger excise tax penalties and loss of deductibility under Sections 280G
and 4999 of the Code. This means that the executive officer will receive
whichever of the following two alternative forms of payment would result in the
executive officers receipt, on an after-tax basis, of the greater amount of the
benefits notwithstanding that all or some portion of the benefit may be subject
to the excise tax: (a) payment in full of the entire amount of the benefits or
(ii) payment of only a part of the benefit so that the executive officer
receives the largest benefit possible without the imposition of the excise tax.
If a participant has other severance benefits in another agreement with us, he
or she will not receive double benefits.
Equity
Awards. Prior to adopting our Severance Plan,
we generally did not enter into employment agreements providing for
post-employment compensation in the form of cash severance or continued employee
benefits to our executive officers. Instead, we offered our executive officers
change in control and severance protections in the form of limited rights to
acceleration of vesting upon a change in control and upon involuntary
terminations of employment following a change in control. Most of the awards
with vesting acceleration benefits vested in full prior to the time of our IPO
(or upon the IPO as noted below). With regard to the awards with remaining
acceleration benefits, in the event there is a change in control:
● |
25% of the then-unvested shares subject to the
stock options granted to Messrs. Stoppelman and Donaker for 1,601,039
shares of Class B common stock and 1,309,941 shares of Class B common
stock, respectively, in January 2011 would vest upon the completion of
such change in control. In addition, 50% of the then-unvested shares
subject to these stock option awards vested upon our IPO in accordance
with the applicable equity agreements. |
|
|
● |
50% of the then-unvested shares subject to the
stock option for 75,000 shares of Class B common stock and the restricted
stock award of 150,000 shares of Class B common stock granted to Mr.
Krolik in July 2011 would vest upon his termination without cause, or a
material reduction in his responsibilities as compared to his
responsibilities prior to such change in control, within one year after
the change in control, subject to Mr. Krolik delivering to the Company,
and not revoking, a release of claims. |
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Table of
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Equity awards are also subject to
potential vesting acceleration under the terms of our equity plans. For a
summary of these terms, see Equity Incentive
Plans below.
Equity Incentive
Plans
2012 Equity Incentive Plan, as
amended
In January 2012, our Board adopted, and our
stockholders subsequently approved, our 2012 Plan as a successor to and continuation of our 2011 Plan. In 2013, our Board
and stockholders approved an amendment to the 2012 Plan to increase the aggregate number of shares of our Class A common
stock that may be issued pursuant to awards under the 2012 Plan by 2,000,000 shares. In addition, the number of shares of
our Class A common stock reserved for issuance under our 2012 Plan automatically increased on January 1, 2013, 2014 and 2015
by 2,540,210, 2,834,979 and 1,458,411 shares, respectively, and will continue to increase automatically on January 1 of each
year through and including January 1, 2022 by 4.0% of the total number of shares of our capital stock outstanding on
December 31 of the preceding calendar year, or a lesser number of shares determined by the Board.
The 2012 Plan
provides for the grant of incentive stock options, nonstatutory stock options,
stock appreciation rights, restricted stock awards, restricted stock unit
awards, performance-based stock awards and other stock awards. Additionally, the
2012 Plan provides for the grant of performance cash awards to our employees,
directors and consultants. Incentive stock options granted under the 2012 Plan
are intended to qualify as incentive stock options within the meaning of
Section 422 of the Code. Nonstatutory stock options granted under the 2012 Plan
are not intended to qualify as incentive stock options under the Code. To date,
we have granted stock options and restricted stock units under the 2012 Plan.
As of March
23, 2015, options to purchase 5,294,794 shares of Class A common stock granted
pursuant to the 2012 Plan were outstanding and 1,653,825 shares of Class A
common stock were subject to issuance upon settlement of unvested restricted
stock unit awards issued pursuant to the 2012 Plan. Such outstanding options had
a weighted-average exercise price of approximately $29.68 per share as of that
date.
Our Board has
delegated concurrent authority to administer the 2012 Plan to our Compensation
Committee.
Our 2012 Plan
provides that in the event of a specified corporate transaction, as defined in
the 2012 Plan, the administrator will determine how to treat each outstanding
stock award. The administrator may: (1) arrange for the assumption, continuation
or substitution of a stock award by a successor corporation; (2) arrange for the
assignment of any reacquisition or repurchase rights held by us to a successor
corporation; (3) accelerate the vesting of a stock award and provide for its
termination prior to the transaction; (4) arrange for the lapse of any
reacquisition or repurchase rights held by us; or (5) cancel the stock award
prior to the transaction in exchange for a cash payment, which may be reduced by
the exercise price payable in connection with the stock award. The administrator
is not obligated to treat all stock awards or portions of stock awards, even
those that are of the same type, in the same manner.
The
administrator may provide, in an individual award agreement or in any other
written agreement between a participant and us, that the stock award will be
subject to additional acceleration of vesting and exercisability in the event of
a change in control (as defined in the 2012 Plan). In the absence of such a
provision, no such acceleration of the stock award will occur.
2011 Equity Incentive
Plan
Our Board
adopted, and our stockholders approved, our 2011 Plan in July 2011, as a
successor to and continuation of our 2005 Plan discussed below. As of March 23,
2015, options to purchase 578,708 shares of Class B common stock at a
weighted-average exercise price per share of $10.77 remained outstanding under
our 2011 Plan. No grants have been made under our 2011 Plan since the date of
our IPO and no further awards will be granted under our 2011 Plan. All
outstanding awards continue to be governed by their existing terms.
Our Board has
delegated concurrent authority to administer our 2011 Plan to our Compensation
Committee under the terms of the Compensation Committees charter.
Our 2011 Plan
provides that in the event of a specified corporate transaction, as defined
under the 2011 Plan, the administrator will determine how to treat each
outstanding stock award. The administrator may (1) arrange for the assumption,
continuation or substitution of a stock award by a successor corporation; (2)
arrange for the assignment of any reacquisition or repurchase rights held by us
to a successor corporation; (3) accelerate the vesting of the stock award and
provide for its termination prior to the transaction and arrange for the lapse
of any reacquisition or repurchase rights held by us; or (4) cancel the stock
award prior to the transaction in exchange for a cash payment, which may be
reduced by the exercise price payable in connection with the stock award. The
administrator is not obligated to treat all stock awards or portions of stock
awards, even those that are of the same type, in the same manner.
The
administrator may provide, in an individual award agreement or in any other
written agreement between a participant and us, that the stock award will be
subject to additional acceleration of vesting and exercisability in the event of
a change in control. In the absence of such a provision, no acceleration of the
stock award will occur.
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Table of
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Amended and Restated 2005 Equity
Incentive Plan
Our Board
adopted, and our stockholders approved, our 2005 Plan in September 2005. As of
March 23, 2015, options to purchase 3,074,169 shares of Class B common stock at
a weighted-average exercise price per share of $7.02 remained outstanding under
the 2005 Plan. Effective as of July 2011, our Board terminated the 2005 Plan and
provided that no further stock awards were to be granted under our 2005 Plan.
All outstanding stock awards under the 2005 Plan will continue to be governed by
their existing terms.
Our Board has
delegated concurrent authority to administer our 2005 Plan to our Compensation
Committee under the terms of the Compensation Committees charter.
In the event
of a corporate transaction, including a reorganization, merger, consolidation,
split-up, spin-off or combination, or a disposition of our securities, the
administrator will determine how to treat each outstanding stock award. The
administrator may (1) provide for the purchase of the stock award for cash had
the stock award been exercisable, payable or fully vested, or provide for the
replacement of the stock award with other rights or property determined by the
administrator; (2) provide that the stock award will be exercisable in full; (3)
provide for the assumption and substitution of the stock award by a successor
corporation; (4) adjust the number and type of securities or property subject to
the stock award and/or the terms and conditions (including the grant or exercise
price) of the stock award or stock awards that may be granted in the future; or
(5) provide that the stock award will not be exercisable and will terminate
immediately upon the consummation of the transaction, provided that for a
specified period of time prior to the transaction, the stock award will be
exercisable in full, the restrictions imposed on the shares subject to the stock
award may be terminated and any repurchase price held by us will no longer be in
effect.
2012 Employee Stock Purchase
Plan
In January
2012, our Board adopted, and our stockholders subsequently approved, our 2012 ESPP. As of
March 23, 2015, the maximum aggregate number of shares of our Class A common
stock that may be issued under our 2012 ESPP is 1,958,667 shares. The number of
shares of our Class A common stock reserved for issuance under the 2012 ESPP
automatically increased on January 1, 2013 by 1,270,105 shares, and will
continue to increase automatically each year through and including January 1,
2022, by the least of (i) 2.0% of the total number of shares of our capital
stock outstanding on December 31 of the preceding calendar year; (ii) 5,000,000
shares of Class A common stock; or (iii) such lesser number as determined by our
Board. Shares subject to purchase rights granted under our 2012 ESPP that
terminate without having been exercised in full will not reduce the number of
shares available for issuance under our 2012 ESPP.
Our Board, or
a duly authorized committee thereof, will administer our 2012 ESPP. Our Board
has delegated concurrent authority to administer our 2012 ESPP to our
Compensation Committee under the terms of the Compensation Committees charter.
Our
employees, including executive officers, or any employees of our designated
affiliates may have to satisfy one or more of the following service requirements
before participating in our 2012 ESPP, as determined by the administrator: (a)
customary employment with us or one of our affiliates for more than 20 hours per
week and more than five months per calendar year, or (b) continuous employment
with us or one of our affiliates for a minimum period of time, not to exceed two
years, prior to the first date of an offering. An employee may not be granted
rights to purchase stock under our 2012 ESPP if such employee (x) immediately
after the grant would own stock possessing five percent or more of the total
combined voting power or value of our common stock, or (y) holds rights to
purchase stock under our 2012 ESPP that would accrue at a rate that exceeds
$25,000 worth of our stock for each calendar year that the rights remain
outstanding.
The
administrator may approve offerings with a duration of not more than 27 months,
and may specify one or more shorter purchase periods within each offering. Each
offering will have one or more purchase dates on which shares of our Class A
common stock will be purchased for the employees who are participating in the
offering. The administrator, in its discretion, will determine the terms of
offerings under our 2012 ESPP.
Our 2012 ESPP
permits participants to purchase shares of our Class A common stock through
payroll deductions or other methods, if required by law, with up to 15% of their
earnings. The purchase price of the shares will not be less than 85% of the
lower of the fair market value of our Class A common stock on the first day of
an offering or on the date of purchase.
A participant
may not transfer purchase rights under our 2012 ESPP other than by will, the
laws of descent and distribution or as otherwise provided under our 2012 ESPP.
In the event
of a specified corporate transaction, such as our merger or change in control, a
successor corporation may assume, continue or substitute each outstanding
purchase right. If the successor corporation does not assume, continue or
substitute for the outstanding purchase rights, the offering in progress will be
shortened and a new exercise date will be set. The participants purchase rights
will be exercised on the new exercised date and such purchase rights will
terminate immediately thereafter.
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Our 2012 ESPP
will remain in effect until terminated by the administrator in accordance with
the terms of the 2012 ESPP. Our Board has the authority to amend, suspend or
terminate our 2012 ESPP, at any time and for any reason.
Additional Benefits
We maintain a
tax-qualified 401(k) retirement plan for all employees who satisfy certain
eligibility requirements, including requirements relating to age and length of
service. Under our 401(k) plan, employees may elect to defer a portion of their
eligible compensation, subject to applicable annual limits under the Code. We
intend for the 401(k) plan to qualify under Section 401(a) and 501(a) of the
Code so that contributions by employees to the 401(k) plan, and income earned on
those contributions, are not taxable to employees until withdrawn from the
401(k) plan.
For a
description of additional benefits we offer to our executive officers, including
health and welfare benefits and the additional benefits provided to Messrs.
Stoppelman and Donaker in connection with the reduction of their salaries to a
nominal amount, as well as to Mr. Nachman in connection with his secondment to
Yelp UK Ltd. and its conclusion, please see
Compensation Discussion and
AnalysisExecutive Compensation Program ComponentsEmployee
Benefits.
GRANTS OF PLAN-BASED AWARDS
No grants of
plan-based awards were made to the named executive officers during the year
ended December 31, 2014.
OUTSTANDING EQUITY AWARDS
AT
FISCAL YEAR END
The following
table shows certain information regarding outstanding equity awards at December
31, 2014 for the named executive officers.
Outstanding Equity
Awards at December 31, 2014
|
|
|
|
|
|
Option
Awards |
|
Stock
Awards |
|
|
|
|
|
|
Number of |
|
Number of |
|
|
|
|
|
|
|
|
|
Number of |
|
|
|
|
|
|
|
|
|
|
|
Securities |
|
Securities |
|
|
|
|
|
|
|
|
|
Shares or |
|
Market Value |
|
|
|
|
|
|
Underlying |
|
Underlying |
|
|
|
|
|
|
|
|
|
Units of |
|
of Shares or |
|
|
Class of |
|
Unexercised |
|
Unexercised |
|
Option |
|
Option |
|
Stock that |
|
Units of Stock |
|
|
Common |
|
Options (#) |
|
Options (#) |
|
Exercise |
|
Expiration |
|
Have Not |
|
that Have Not |
Name |
|
Stock |
|
Exercisable |
|
Unexercisable |
|
Price ($) |
|
Date |
|
Vested (#) |
|
Vested ($) |
Jeremy Stoppelman |
|
|
Class B |
|
|
|
1,379,732 |
|
|
|
221,307 |
(1) |
|
|
|
7.16 |
|
|
|
01/05/2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A |
|
|
|
153,333 |
|
|
|
421,667 |
(2) |
|
|
|
21.18 |
|
|
|
02/05/2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A |
|
|
|
82,500 |
|
|
|
7,500 |
(3) |
|
|
|
21.18 |
|
|
|
02/05/2023 |
|
|
|
|
|
|
|
|
|
|
|
Rob
Krolik |
|
|
Class
B |
|
|
|
19,062 |
|
|
|
10,938 |
(4) |
|
|
|
9.08 |
|
|
|
07/26/2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class
B |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
25,659 |
(5) |
|
|
|
1,404,317 |
(6) |
|
|
|
|
Class
A |
|
|
|
35,333 |
|
|
|
179,667 |
(7) |
|
|
|
21.18 |
|
|
|
02/05/2023 |
|
|
|
|
|
|
|
|
|
|
|
Geoff Donaker |
|
|
Class B |
|
|
|
696,660 |
|
|
|
181,281 |
(8) |
|
|
|
7.16 |
|
|
|
01/05/2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A |
|
|
|
113,333 |
|
|
|
311,667 |
(2) |
|
|
|
21.18 |
|
|
|
02/05/2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A |
|
|
|
82,500 |
|
|
|
7,500 |
(3) |
|
|
|
21.18 |
|
|
|
02/05/2023 |
|
|
|
|
|
|
|
|
|
|
|
Jed
Nachman |
|
|
Class
B |
|
|
|
26,555 |
|
|
|
|
|
|
|
|
7.16 |
|
|
|
01/05/2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class
A |
|
|
|
41,121 |
|
|
|
161,334 |
(2) |
|
|
|
21.18 |
|
|
|
02/05/2023 |
|
|
|
|
|
|
|
|
|
|
|
Laurence Wilson |
|
|
Class B |
|
|
|
74,400 |
|
|
|
|
|
|
|
|
7.16 |
|
|
|
01/25/2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A |
|
|
|
58,666 |
|
|
|
161,334 |
(2) |
|
|
|
21.18 |
|
|
|
02/05/2023 |
|
|
|
|
|
|
|
|
|
|
|
____________________
(1) |
For the first 12 months following
the vesting commencement date of November 10, 2010, 13,342 shares vested
monthly; for the second 12 months, 20,013 shares vested monthly; for the
third 12 months, 26,684 shares vested monthly; for the fourth 12 months,
33,355 shares vest monthly; and for the fifth 12 months, the remaining
shares vest ratably. |
|
|
(2) |
10% of the shares underlying this
option vested in equal monthly installments over the first 12 months
following the vesting commencement date of February 5, 2013; 20% of the
shares underlying the option vested in equal monthly installments over the
second 12 months; 30% of the shares underlying the option vest in equal
monthly installments over the third 12 months; and 40% of the shares
underlying the option vest in equal monthly installments over the fourth
12 months. |
|
(3) |
1/24th of the shares
underlying this option vest each month for two years following the grant
date of February 5, 2013. |
39
Table of
Contents
(4) |
25% of the shares
underlying this option vested on July 27, 2012. Thereafter, the remaining
shares vest in a series of 36 equal monthly installments. |
|
|
(5) |
25% of the shares
underlying this award vested on July 27, 2012 and 2,466 shares vested on
August 20, 2012. Thereafter, 1/16 of the shares subject to this award (or
remaining portion thereof, if smaller) vest on the 20th day of
each November, February, May and August thereafter until all shares are
vested. |
|
(6) |
Represents the market
value of the unvested shares subject to the indicated restricted stock
award based on the closing price of our Class A common stock on December
31, 2014, which was $54.73 per share. The value assumes that the fair
market value of a share of our Class B common stock, which is not listed
or approved for trading on or with any securities exchange or association,
is equal to the fair market value of a share of our Class A common
stock. |
|
(7) |
10% of the shares
underlying this option vested in equal monthly installments over the first
12 months following the vesting commencement date of July 27, 2013; 20% of
the shares underlying this option vest in equal monthly installments over
the second 12 months; 30% of the shares underlying the option vest in
equal monthly installments over the third 12 months; and 40% of the shares
underlying the option vest in equal monthly installments over the fourth
12 months. |
|
(8) |
For the first 12
months following the vesting commencement date of November 10, 2010,
10,916 shares underlying the option vested monthly; for the second 12
months, 16,374 shares vested monthly; for the third 12 months, 21,833
shares vested monthly; for the fourth 12 months, 27,291 shares vest
monthly; and for the fifth 12 months, the remaining unvested shares vest
ratably. |
OPTION EXERCISES AND STOCK VESTED
The following
table shows certain information regarding option exercises and stock vested
during the year ended December 31, 2014 with respect to the named executive
officers.
Option Exercises and Stock Vested in
the Year Ended December 31, 2014
|
|
Option Awards |
|
Stock Awards |
|
|
Number of Shares |
|
Value Realized |
|
Number of |
|
Value Realized |
|
|
Acquired on |
|
on Exercise |
|
Shares Acquired |
|
on Vesting |
Name |
|
Exercise (#)(1) |
|
($)(2) |
|
on Vesting (#)(3) |
|
($)(4) |
Rob Krolik |
|
|
25,000 |
|
|
|
1,413,600 |
|
|
|
37,500 |
|
|
|
2,689,969 |
|
Geoff
Donaker |
|
|
307,000 |
|
|
|
19,553,460 |
|
|
|
|
|
|
|
|
|
Jed Nachman |
|
|
153,444 |
|
|
|
11,368,598 |
|
|
|
|
|
|
|
|
|
Laurence
Wilson |
|
|
108,850 |
|
|
|
7,091,382 |
|
|
|
|
|
|
|
|
|
____________________
(1) |
With the exception of an exercise
for 5,000 shares of Class A common stock by Mr. Krolik and an exercise for
17,545 shares of Class A common stock by Mr. Nachman, the shares exercised
were shares of our Class B common stock. |
|
|
(2) |
The value realized is calculated
as the difference between the closing price of our Class A common stock on
the date of exercise and the applicable exercise price of such options,
multiplied by the number of shares underlying the options that were
exercised. The value assumes that the fair market value of a share of our
Class B common stock is equal to the fair market value of a share of our
Class A common stock. |
|
(3) |
In each case, the shares vested
were shares of our Class B common stock. |
|
(4) |
The value realized equals the
closing price of our Class A common stock on each vesting date, or, if the
vesting date fell on a non-trading day, the closing price on the trading
day preceding the vesting date, multiplied by the number of shares vested
on that date. The value assumes that the fair market value of a share of
our Class B common stock is equal to the fair market value of a share of
our Class A common stock. |
40
Table of
Contents
POTENTIAL PAYMENTS UPON TERMINATION
OR
CHANGE IN CONTROL
The following
table sets forth quantitative estimates of the benefits that each of our named
executive officers would be entitled to in connection with certain termination
and change in control events pursuant to the Severance Plan and pursuant to the
terms of their equity awards. The table assumes that the qualifying termination
or change in control event, as applicable, occurred on December 31, 2014.
|
|
Lump Sum Cash |
|
Continuation |
|
|
|
|
|
|
|
|
|
|
Severance Payment |
|
of Benefits |
|
Value of Equity |
|
|
|
|
Name |
|
($)(1) |
|
($)(2) |
|
Acceleration ($) |
|
Total ($) |
Jeremy Stoppelman |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Qualifying
Termination |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Plan(3) |
|
|
1 |
|
|
|
2,657 |
|
|
|
|
|
|
|
2,658 |
|
Equity Awards |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in
Control |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Plan |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity Awards(4) |
|
|
|
|
|
|
|
|
|
|
2,631,858 |
(5) |
|
|
2,631,858 |
|
Qualifying
Termination Upon Change in Control |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Plan(6) |
|
|
1 |
|
|
|
2,657 |
|
|
|
7,199,260 |
(5) |
|
|
7,201,917 |
|
Equity Awards(4) |
|
|
|
|
|
|
|
|
|
|
2,631,858 |
(5) |
|
|
2,631,858 |
|
Rob
Krolik |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Qualifying
Termination |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Plan(3) |
|
|
325,000 |
|
|
|
8,058 |
|
|
|
|
|
|
|
333,058 |
|
Equity Awards |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in
Control |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Plan |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity Awards |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Qualifying
Termination Upon Change in Control |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Plan(6) |
|
|
325,000 |
|
|
|
8,058 |
|
|
|
3,013,897 |
(5) |
|
|
3,346,956 |
|
Equity Awards(7) |
|
|
|
|
|
|
|
|
|
|
951,791 |
|
|
|
951,791 |
|
Geoff Donaker |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Qualifying
Termination |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Plan(3) |
|
|
1 |
|
|
|
8,058 |
|
|
|
|
|
|
|
8,059 |
|
Equity Awards |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in
Control |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Plan |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity Awards(4) |
|
|
|
|
|
|
|
|
|
|
2,155,825 |
(5) |
|
|
2,155,825 |
|
Qualifying
Termination Upon Change in Control |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Plan(6) |
|
|
1 |
|
|
|
8,058 |
|
|
|
5,354,010 |
(5) |
|
|
5,362,069 |
|
Equity Awards(4) |
|
|
|
|
|
|
|
|
|
|
2,155,825 |
(5) |
|
|
2,155,825 |
|
Jed
Nachman |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Qualifying
Termination |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Plan(3) |
|
|
325,000 |
|
|
|
8,058 |
|
|
|
|
|
|
|
333,058 |
|
Equity Awards |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in
Control |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Plan |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity Awards |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Qualifying
Termination Upon Change in Control |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Plan(6) |
|
|
325,000 |
|
|
|
8,058 |
|
|
|
2,706,378 |
(5) |
|
|
3,039,436 |
|
Equity Awards |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Laurence Wilson |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Qualifying
Termination |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Plan(3) |
|
|
325,000 |
|
|
|
2,620 |
|
|
|
|
|
|
|
327,620 |
|
Equity Awards |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in
Control |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Plan |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity Awards |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Qualifying
Termination Upon Change in Control |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance Plan(6) |
|
|
325,000 |
|
|
|
2,620 |
|
|
|
2,706,378 |
(5) |
|
|
3,033,998 |
|
Equity Awards |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
41
Table of
Contents
____________________
(1) |
Represents one year of the
executive officers base salary in effect as of December 31, 2014. The
amount indicated does not include the payment of any accrued salary or
vacation that may be due upon termination of employment. |
|
|
(2) |
Represents six months of payments
of premiums for continued health insurance coverage under COBRA, assuming
in each case that the executive officer timely elects to receive the
benefits. Under the Severance Plan, we would continue to pay such premiums
for six months unless the executive officer earlier (a) becomes eligible
for substantially equivalent health insurance coverage in connection with
new employment or self-employment, or (b) loses eligibility for
continuation coverage under COBRA. |
|
(3) |
Represents benefits payable under
the Severance Plan upon an involuntary termination without cause or a
constructive termination (as such terms are defined in the Severance
Plan). |
|
(4) |
Represents vesting acceleration
upon a change in control under the terms of an equity award held by such
executive officer. |
|
(5) |
The value is calculated as (a)
the difference between $54.73, the closing price of our Class A common
stock on December 31, 2014, and the exercise price of the applicable
option, multiplied by (b) the number of unvested options subject to
accelerated vesting held by the applicable named executive officer. With
respect to the acceleration of options covering shares of our Class B
common stock, assumes that the fair market value of a share of our Class B
common stock is equal to the fair market value of a share of our Class A
common stock. |
|
(6) |
Represents benefits payable under
the Severance Plan upon an involuntary termination without cause or a
constructive termination that occurs on or within 12 months following a change
in control (as such terms are defined in the Severance Plan). |
|
(7) |
Under his equity award
agreements, Mr. Krolik is entitled to certain vesting acceleration if,
within one year following a change in control, he is terminated without
cause or there is a material reduction in his responsibilities. The value
of the vesting acceleration is calculated as the sum of (a) the number of
unvested shares underlying Mr. Kroliks restricted stock award subject to
accelerated vesting, multiplied by $54.73, the closing price of our Class
A common stock on December 31, 2014, and (b) the amount described in note
(5) above. Assumes that the fair market value of a share of our Class B
common stock is equal to the fair market value of a share of our Class A
common stock. |
42
Table of
Contents
TRANSACTIONS WITH
RELATED PERSONS
RELATED-PERSON TRANSACTIONS POLICY
AND
PROCEDURES
We have
adopted a written Related-Person Transactions Policy that sets forth our
policies and procedures regarding the identification, review, consideration and
approval or ratification of related-person transactions. For purposes of our
policy only, a related-person transaction is a transaction, arrangement or
relationship (or any series of similar transactions, arrangements or
relationships) in which the Company and any related person are participants
involving an amount that exceeds $100,000. Transactions involving compensation
for services provided to the Company as an employee, director or consultant are
not covered by this policy. A related person is any executive officer, director
or more than five percent stockholder of the Company, including any of their
immediate family members, and any entity owned or controlled by such persons.
Under the
policy, where a transaction has been identified as a related-person transaction,
management must present information regarding the proposed related-person
transaction to the Audit Committee (or, where the Audit Committee would be
inappropriate, to another independent committee of the Board) for consideration
and approval or ratification. The presentation must include a description of,
among other things, the material facts, the interests, direct and indirect, of
the related persons, the benefits to the Company of the transaction and whether
any alternative transactions were available. To identify related-person
transactions in advance, we rely on information supplied by our executive
officers, directors and certain significant stockholders.
In
considering related-person transactions, the Audit Committee takes into account
the relevant available facts and circumstances including, but not limited to (a)
the risks, costs and benefits to the Company, (b) the impact on a directors
independence in the event the related person is a director, immediate family
member of a director or an entity with which a director is affiliated, (c) the
terms of the transaction, (d) the availability of other sources of comparable
services or products and (e) the terms available to or from, as the case may be,
unrelated third parties, or to or from employees generally. The policy requires
that, in determining whether to approve, ratify or reject a related-person
transaction, the Audit Committee consider, in light of known circumstances,
whether the transaction is in, or is not inconsistent with, the best interests
of the Company and our stockholders, as the Audit Committee determines in the
good faith exercise of its discretion.
CERTAIN RELATED-PERSON TRANSACTIONS
Other than
compensation arrangements, we describe below transactions and series of similar
transactions during the year ended December 31, 2014, to which we were or will
be a party, in which:
● |
the amounts involved exceeded or
will exceed $120,000; and |
|
|
● |
any of our directors, executive
officers or holders of more than five percent of any class of our common
stock, or any immediate family member of the foregoing persons, had or
will have a direct or indirect material interest.
|
For complete
descriptions of compensation arrangements for our directors and named executive
officers, see Information Regarding the Board
and Corporate GovernanceDirector Compensation and Executive
Compensation, respectively.
Related-Person
Compensation
Michael
Stoppelman, our Vice President, Engineering and brother of our Chief Executive
Officer, Jeremy Stoppelman, received an annualized base salary of $300,000 from
January 1 through March 31, 2014. Mr. Stoppelmans base salary was increased to
$325,000 effective as of April 1, 2014. He also received $720 in reimbursements
for health club membership, our standard U.S. benefits package and The Yelp Foundation made a matching charitable donation of $1,000 on his behalf during 2014. Each of these benefits was provided on the same terms as provided to
all of our regular full-time employees.
In 2015, the Compensation Committee granted Mr. Stoppelman the following equity
awards:
● |
an
option to purchase up to 26,700 shares of our Class A common stock, with
an exercise price of $47.49 per share; |
|
|
● |
an option to purchase up to 13,350 shares of
our Class A common stock, with an exercise price of $45.50 per share;
and |
|
|
● |
a restricted stock unit award covering 66,060 shares of Class A common stock. |
Each of these
awards vests over four years from the date of grant, with 10% of the shares
subject to the award vesting over the first year, 20% vesting over the second
year, 30% vesting over the third year and 40% vesting over the fourth year.
Compensation for Mr. Stoppelmans service as an employee is not considered a
related-person transaction covered by our Related-Person Transaction Policy.
43
Table of
Contents
The Yelp Foundation
In November
2011, our Board approved the establishment of The Yelp Foundation, a non-profit
organization designed to support consumers and businesses in the communities in
which we operate. Messrs. Stoppelman, Donaker, Krolik and Wilson are officers
and directors of The Yelp Foundation. As described in the Executive Compensation
section, The Yelp Foundation made matching charitable donations on behalf of
each of our named executive officers in 2014, as reflected in the Summary
Compensation Table.
Yelp Inc. Political Action
Committee
In the fourth
quarter of 2013, our Board approved the establishment of the Yelp Inc. Political
Action Committee, or Yelp PAC, a non-profit political association, to, among
other things, support the election of candidates to public office that support
the principles of the Company, including free speech and an open internet. Each
of Ms. Irvine and Messrs. Levchin, Donaker, Anderson, Fenton, Levine, Gibbs,
Krolik and Wilson contributed $5,000 to the Yelp PAC during 2014.
Indemnification
Our Amended
and Restated Certificate of Incorporation and Bylaws provide that we will
indemnify our directors and officers, and may indemnify our employees and other
agents, to the fullest extent permitted by the Delaware General Corporation Law.
In addition to the indemnification required in our Amended and Restated
Certificate of Incorporation and Bylaws, we have entered into indemnification
agreements with each of our current directors, officers and certain employees.
These agreements provide for the indemnification of such persons for all
reasonable expenses and liabilities incurred in connection with any action or
proceeding brought against them by reason of the fact that they are or were
serving in such capacity. We have obtained director and officer liability
insurance to cover liabilities our directors and officers may incur in
connection with their services to us.
44
Table of
Contents
HOUSEHOLDING OF PROXY
MATERIALS
The SEC has adopted rules that permit companies
and intermediaries (e.g., brokers) to satisfy the delivery requirements for Notices of Internet Availability of Proxy
Materials or other Annual Meeting materials with respect to two or more stockholders sharing the same address by delivering a
single Notice of Internet Availability of Proxy Materials or set of other Annual Meeting materials addressed to those
stockholders. This process, which is commonly referred to as householding, potentially means extra convenience
for stockholders and cost savings for companies.
This year, we and a number of brokers with account holders who are Yelp stockholders will be householding our
proxy materials. A single Notice of Internet Availability of Proxy Materials will be delivered to multiple stockholders sharing
an address unless contrary instructions have been received from the affected stockholders. Once you have received
notice from us (if you are a stockholder of record) or your broker (if you are a beneficial owner) that we or they, as
applicable, will be householding communications to your address, householding will continue until you are notified
otherwise or until you revoke your consent. If, at any time, you no longer wish to participate in householding and would
prefer to receive a separate Notice of Internet Availability of Proxy Materials, or if you currently receive multiple copies
and would like to request householding of your communications, please notify the Company or your broker. Direct your
written request to the Company to the attention of our Corporate Secretary, Yelp Inc., 140 New Montgomery Street, 9th
Floor, San Francisco, California 94105, or contact our Corporate Secretary at (415) 908-3801.
OTHER MATTERS
The Board knows of no other matters that will be presented for consideration at the Annual Meeting. If any other
matters are properly brought before the Annual Meeting, it is the intention of the persons named in the accompanying
proxy to vote on such matters in accordance with their best judgment.
|
By Order of the Board of
Directors |
|
|
|
![](yelp_def14a5x10x1.jpg) |
|
|
|
Laurence Wilson |
|
Corporate
Secretary |
April 10, 2015
A copy of the Companys Annual
Report to the U.S. Securities and Exchange Commission on Form 10-K for the year
ended December 31, 2014 is available without charge upon written request to:
Corporate Secretary, Yelp Inc., 140 New Montgomery Street, 9th Floor,
San Francisco, California 94105.
45
Table of
Contents
YELP
INC.
|
140 NEW MONTGOMERY ST., 9TH FLOOR SAN FRANCISCO, CA
94105 |
VOTE BY INTERNET -
www.proxyvote.com |
Use the Internet to transmit your
voting instructions and for electronic delivery of information up until
11:59 P.M. Eastern Daylight Time on May 19, 2015. Have your proxy card in
hand when you access the web site and follow the instructions to obtain
your records and to create an electronic voting instruction
form. |
|
ELECTRONIC DELIVERY OF FUTURE PROXY
MATERIALS |
If you would like to reduce the
costs incurred by our company in mailing proxy materials, you can consent
to receiving all future proxy statements, proxy cards and annual reports
electronically via e-mail or the Internet. To sign up for electronic
delivery, please follow the instructions above to vote using the Internet
and, when prompted, indicate that you agree to receive or access proxy
materials electronically in future years. |
|
VOTE BY PHONE - 1-800-690-6903 |
Use any touch-tone telephone to
transmit your voting instructions up until 11:59 P.M. Eastern Daylight
Time on May 19, 2015. Have your proxy card in hand when you call and then
follow the instructions. There is no charge for this
call. |
|
VOTE BY MAIL |
Mark, sign and date your proxy
card and return it in the postage-paid envelope we have provided or return
it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY
11717. |
TO VOTE, MARK BLOCKS BELOW IN
BLUE OR BLACK INK AS FOLLOWS: |
|
|
|
|
M89008-P60132 |
|
KEEP THIS PORTION FOR YOUR
RECORDS |
|
DETACH AND
RETURN THIS PORTION ONLY |
THIS
PROXY CARD IS VALID ONLY WHEN SIGNED AND
DATED. |
|
YELP INC. |
|
|
|
The Board of
Directors recommends you vote FOR all of the following nominees:
|
|
|
|
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1. |
Election of Directors |
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Nominees: |
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01) |
Geoff
Donaker |
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02) |
Robert Gibbs |
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03) |
Jeremy Stoppelman |
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For All |
Withhold All |
For All Except |
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To
withhold authority to vote for any individual nominee(s), mark For All
Except and write the number(s) of the nominee(s) name on the line
below. |
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☐ |
☐ |
☐ |
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The Board of Directors
recommends you vote FOR proposals 2 and 3. |
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For |
Against |
Abstain |
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2. |
To ratify the selection
of Deloitte & Touche LLP as Yelp's independent registered public
accounting firm for the year ending December 31, 2015. |
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☐ |
☐ |
☐ |
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3. |
To approve, on an
advisory basis, the compensation of Yelp's named executive officers, as
disclosed in the accompanying proxy statement. |
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☐ |
☐ |
☐ |
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NOTE: In their
discretion, the proxyholders are authorized to vote upon such other
business as may properly come before the meeting and any adjournment or
postponement thereof. |
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Please sign exactly
as your name(s) appear(s) hereon. When signing as attorney, executor,
administrator, or other fiduciary, please give full title as such. Joint
owners should each sign personally. All holders must sign. If a
corporation or partnership,please sign in full corporate or partnership
name by authorized officer. |
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Signature [PLEASE SIGN WITHIN
BOX] |
Date |
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Signature (Joint Owners) |
Date |
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Table of
Contents
Important Notice Regarding the
Availability of Proxy Materials for the Annual Meeting:
The Notice & Proxy Statement and Annual Report are
available at
www.proxyvote.com.
YELP
INC.
Annual Meeting of Stockholders
May 20, 2015, 9:00 AM, PDT
This
proxy is solicited by the Board of Directors
The undersigned stockholder(s) hereby
revoke(s) all previous proxies, acknowledge(s) receipt of the Notice of the 2015
Annual Meeting of Stockholders of YELP INC. and the accompanying Proxy
Statement, and hereby appoint(s) Laurence Wilson and Rob Krolik, or either of
them, as proxies of the undersigned, each with the power to appoint his
substitute, and hereby authorizes them, or either of them, to represent and to
vote, as designated on the reverse side of this ballot, all of the shares of
Class A Common Stock and Class B Common Stock of YELP INC. that the undersigned
stockholder(s) is/are entitled to vote at the 2015 Annual Meeting of
Stockholders of YELP INC. to be held at 9:00 AM, PDT, on May 20, 2015 at The St.
Regis San Francisco, 125 3rd Street, San Francisco, California 94103,
and any adjournment or postponement thereof.
The shares represented by this
proxy, when properly executed, will be voted in the manner directed by the
stockholder, with discretionary authority as to any and all other matters that
may properly come before the meeting. If no such direction is made, the
proxyholders will have the authority to vote FOR each of the nominees
listed in Proposal No. 1 and FOR Proposal Nos. 2 and
3.
Continued and to be signed on reverse
side
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