UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Securities Exchange Act of 1934 (Amendment No.)
Filed by the Registrant ☒
Filed by a Party other than the Registrant ☐
Check the appropriate box:
Ceridian HCM Holding Inc.
☐ Preliminary Proxy Statement
☐ Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
☒ Definitive Proxy Statement
☐ Definitive Additional Materials
☐ Soliciting Material Pursuant to §240.14a-12
Dayforce, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box)all boxes that apply):
☒ No fee required
☐ Fee paid previously with preliminary materials
☐ Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11
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Minneapolis, Minnesota 55425 |
NOTICE OF 2024 ANNUAL MEETING OF STOCKHOLDERS AND PROXY STATEMENT
Ceridian HCM Holding Inc.
3311 East Old Shakopee RoadDear Stockholder:
Minneapolis, Minnesota 55425
March 22, 2019
Dear Ceridian HCM Holding Inc. Stockholder:
I am pleased to invite youYou are cordially invited to attend the 20192024 Annual Meeting of Stockholders (the “Annual Meeting”) of Ceridian HCM HoldingDayforce, Inc. (“Ceridian”Dayforce”) to be held on Wednesday, May 1, 2019 at 9:at:
Date: Friday, April 26, 2024
Time: 10:00 a.m. Central, Eastern Daylight Time ("EDT")
Location: Online at Ceridian’s offices at 3311 East Old Shakopee Road, Minneapolis, Minnesota.www.virtualshareholdermeeting.com/DAY2024
Details regarding
Once again, we are holding our Annual Meeting virtually by means of a live webcast in order to make the meeting and the businessconveniently accessible to be conducted are more fully described in the accompanying Notice of 2019 Annual Meeting of Stockholders and Proxy Statement.
We are providing access to our proxy materials over the Internet under the United States Securities and Exchange Commission’s “notice and access” rules. As a result, we are mailing to manyall of our stockholders, a notice instead of a paper copy of this Proxy Statementwho will be able to listen, vote, and our 2018 Annual Report to Stockholders. The notice contains instructions on how to access those documents oversubmit questions remotely via the Internet. The notice also contains instructions on how you can receive a paper copy of our proxy materials, including this Proxy Statement, our 2018 Annual Report to Stockholders, and a form of proxy card or voting instruction card. All stockholders who do not receive a notice, including stockholders who have previously requested to receive paper copies of proxy materials, will receive a paper copy of the proxy materials by mail unless they previously have requested delivery of proxy materials electronically. This distribution process also conserves natural resources and reduces the costs of printing and distributing our proxy materials.
Your vote is important.In order to ensure your representation at the meeting, whether or notIf you plan to attend the meeting,virtual Annual Meeting, please vote your shares as promptly as possible. Your participation will help to ensurenote the presence of a quorum at the meeting and save Ceridian the extra expense associated with additional solicitation. If you hold your shares through a broker, your broker is not permitted to votelog-in procedures described under “Admission” on your behalf on certain proposals unless you provide specific instructions to the broker by completing and returning any voting instruction form that the broker provides (or following any instructions that allow you to vote your broker-held shares via telephone or the internet). For your vote to be counted, you will need to communicate your voting decision by the datepage 66 of the Annual Meeting. Voting your shares in advance will not prevent you from attendingproxy statement. There are three items of business for the Annual Meeting, revoking your earlier submitted proxy or voting your stock in person.Meeting:
Thank you for your ongoing support
Items of and continued interest in Ceridian.
Sincerely,
David D. Ossip
Chair of the Board of Directors and Chief Executive Officer
Ceridian HCM Holding Inc.
3311 East Old Shakopee Road
Minneapolis, Minnesota 55425
NOTICE OF 2019 ANNUAL MEETING OF STOCKHOLDERS
Notice is hereby given that Ceridian HCM Holding Inc. (“Ceridian”) will hold its 2019 Annual Meeting of Stockholders (the “Annual Meeting”) on Wednesday, May 1, 2019 at 9:00 a.m. Central Daylight Time at Ceridian’s offices at 3311 East Old Shakopee Road, Minneapolis, Minnesota for the following purposes:
Business
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In addition, weDayforce will consider the transaction of any other business as may properly come before the Annual Meeting or any adjournment, continuation, or postponement thereof.
Your Vote is Very Important
On or about March 22, 2019, Ceridian12, 2024, Dayforce mailed or made available to its stockholders itsproxy materials, including the proxy statement for itsthe Annual Meeting (the “Proxy Statement”) and, its 2018 Annual Report which includes its annual report on Form 10-K for the fiscal year ended December 31, 20182023 (the “2018“2023 Annual Report”). The, and form of proxy or the Notice of Internet Availability of Proxy Statement and 2018 Annual ReportMaterials. These proxy materials can be accessed directly at the internet address www.proxydocs.com/CDAY.proxyvote.com.
Only stockholders of record
If you were a stockholder at the close of business on March 4, 20192024 (the “Record Date”), you are entitled to notice of andeligible to vote at the Annual Meeting as set forth in the Proxy Statement. IfMeeting. Whether or not you plan to attendparticipate in the Annual Meeting, please be assured that your vote is very important to us. We urge you to participate in person, you should be prepared to present photo identification such as a valid driver’s licensethe election of our directors and verification of stock ownership for admittance. You are entitled to attendin deciding the Annual Meeting only if you were a stockholder as of the close of businessother items on the Record Date or hold a valid proxyagenda for the Annual Meeting. If you are a stockholder of record, your ownership as of the Record Date will be verified prior to admittance into the meeting. If you are not a stockholder of record but hold shares through a broker, trustee or nominee, you must provide proof of beneficial ownership as of the Record Date, such as an account statement or similar evidence of ownership. Please allow ample time for the admittance process.
If you have any questions regarding this information or the proxy materials, please contact Ceridian’sDayforce’s Corporate Secretary at stockholders@ceridian.com.stockholders@dayforce.com.
By Order of the Board of Directors,
William E. McDonald
SeniorExecutive Vice President, Deputy General Counsel, and Corporate Secretary
Minneapolis, Minnesota
March 22, 201912, 2024
This Notice of Annual Meeting and Proxy Statement and Form of Proxy
are being distributed and made available on or about March 22, 2019.12, 2024.
Important Notice Regardingnotice regarding the Availabilityavailability of Proxy Materialsproxy materials for the 20192024 Annual Meeting of Stockholders to Be Heldbe held on May 1, 2019.April 26, 2024.The Proxy Statement and 20182023 Annual Report are available electronically on the “Investor Relations” page of ourDayforce’s website located at www.ceridian.comwww.dayforce.com and at www.proxydocs.com/CDAY.proxyvote.com.
CERIDIAN HCM HOLDING INC.
2019 ANNUAL MEETING OF STOCKHOLDERS
PROXY STATEMENT
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2024 PROXY STATEMENT SUMMARY | ||||
Dayforce Values | ||||
Business Highlights for Fiscal Year 2023 | ||||
2024 Annual Meeting Information | ||||
Corporate Governance Priorities | ||||
Executive Compensation Priorities | ||||
2024 PROXY STATEMENT | ||||
PROPOSAL ONE: ELECTION OF DIRECTORS | ||||
Board Selection Criteria | ||||
Board Diversity | ||||
Stockholder Recommendations | ||||
Director Nominees | ||||
BOARD OF DIRECTORS | ||||
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Oversight Responsibilities | ||||
Meetings of the Board of Directors and Stockholders | ||||
Committees of the Board of Directors | ||||
Board’s Role in Risk Oversight | ||||
CORPORATE GOVERNANCE | ||||
Code of Conduct | ||||
Corporate Governance Guidelines | ||||
Director Service on Other Public Company Boards | ||||
No-Hedging and No-Pledging Policy | ||||
Director Evaluations | ||||
Management Development and Succession Planning | ||||
Indemnification of Directors and Officers | ||||
DIRECTOR COMPENSATION | ||||
EXECUTIVE COMPENSATION | ||||
COMPENSATION DISCUSSION & ANALYSIS | ||||
Executive Summary | ||||
Executive Compensation Program Goals and Considerations | ||||
2023 Compensation Elements and Analysis | ||||
Compensation Governance | ||||
Executive Compensation Tables | ||||
Agreements with our NEOs | ||||
CEO Pay Ratio | ||||
Pay Versus Performance | ||||
PROPOSAL | ||||
PROPOSAL THREE: RATIFICATION OF THE APPOINTMENT OF KPMG LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR FISCAL YEAR 2024 | ||||
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT | ||||
Registration Rights Agreement | ||||
Policies for Approval of Related Person Transactions | ||||
Other Transactions | ||||
VOTING INFORMATION | ||||
TRANSACTION OF OTHER BUSINESS AND ADDITIONAL INFORMATION | ||||
APPENDIX A |
| 2024 PROXY STATEMENT |
2024 PROXY STATEMENT SUMMARY |
i
CeridianAs a global human capital management ("HCM") software company, Dayforce aims to make work life better. Everything we do as a global leader in HCM Holding Inc.technology is focused on improving work for thousands of customers and millions of employees around the world. Our single, global people platform for HR, payroll, talent, workforce management, and benefits equips Dayforce customers to unlock their full workforce potential and operate with confidence.
3311 East Old Shakopee Road
Minneapolis, Minnesota 55425
PROXY STATEMENT
FOR THE 2019 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD WEDNESDAY, MAY 1, 2019
Our BoardWe continually strive to provide exceptional value to our stakeholders, and "Our Way" is the set of Directors (the “Board”) solicits your proxy onvalues that guide our behalf for the 2019 Annual Meeting of Stockholders (the “Annual Meeting”) and at any adjournment, continuation or postponement of the Annual Meeting for the purposes set forth in this proxy statement for our Annual Meeting (the “Proxy Statement”) and the accompanying Notice of 2019 Annual Meeting of Stockholders (the “Notice”). Holders of record of shares of our common stock, $0.01 par value (“Common Stock”), and the holder of the share of special voting preferred stock, par value $0.01 per share (the “Special Voting Share” and together with the Common Stock, the “Voting Stock”), at the close of business on March 4, 2019 (the “Record Date”), will be entitledbehavior. These values are core to notice of and to vote at the Annual Meeting. The Annual Meeting will be held at our offices at 3311 East Old Shakopee Road, Minneapolis, Minnesota on Wednesday, May 1, 2019 at 9:00 a.m. Central Daylight Time. On or about March 22, 2019, we mailed our stockholders the Proxy StatementDayforce’s culture and our 2018 Annual Report forthinking.
| Customer focus | We put the customer at the center of everything we do. We deliver quantifiable value through actionable insights. |
| Shared ambition | We win, learn, and grow together. We’re individually and collectively accountable and empowered. |
| Agility | We are a global enterprise company with the heart of a start-up that embraces innovation, doesn’t fear change, and values adaptability. |
| Equity | We are building a culture of diversity, inclusion, and belonging. We ensure all employees – of any race, ethnicity, age, gender, sexual orientation, identity or expression, religion, or ability status – can achieve their full potential. |
| Optimism | Optimism drives success. Preparation leads to knowledge, knowledge leads to confidence, and confidence leads to optimism. |
| Transparency | We are open, honest, and respectful. |
| 1 | 2024 PROXY STATEMENT |
Business Highlights
We continue to make meaningful progress towards our medium term goal of achieving $2.0 billion in total revenue, 80% adjusted Cloud recurring revenue gross margin, and 30% adjusted EBITDA margin by the fiscal year ended December 31, 2018 (the “2018 Annual Report”).end of 2025. We are proud that our business continues to grow in a sustainable and profitable manner, with our 2024 performance highlighted by the following:
In
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See Appendix A included in this Proxy Statement the terms “Ceridian,” “the Company,” “we,” “us” and “our” refer to Ceridian HCM Holding Inc. and its subsidiaries. The mailing addressstarting on page 71 for information regarding non-GAAP financial measures, including a reconciliation of our principal executive offices is Ceridian HCM Holding Inc., 3311 East Old Shakopee Road, Minneapolis, Minnesota 55425.
As of the Record Date, there were 138,181,331 shares of Common Stock issued and outstanding and entitled to vote at the Annual Meeting. Each share of Common Stock is entitled to one vote on any matter presented to stockholders at the Annual Meeting. In addition, the holder of the Special Voting Share is entitled to vote on all matters that a holder of our Common Stock is entitled to vote on and is entitled to cast a number of votes equalnon-GAAP financial measures to the numbermost directly comparable financial measures prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”).
1Excluding the 2021 acquisition of shares of Common Stock issuable upon exchange of the exchangeable shares of Ceridian AcquisitionCo ULC (the “Exchangeable Shares”Ascender HCM Pty Limited ("Ascender") then outstanding. As of the Record Date, the Exchangeable Shares outstanding were exchangeable.
2Gartner, Magic Quadrant for 2,352,923 shares of our Common Stock.Cloud HCM Suites for 1,000+ Employee Enterprises. Ranadip Chandra, Josie Xing, Sam Grinter, Ron Hanscome, Chris Pang, Josie Xing, 2023.
| 2 | 2024 PROXY STATEMENT |
2024 Annual Meeting Information
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Date and Time Friday, April 26, 2024 10:00 a.m., Eastern Daylight Time | Location – Online www.virtualshareholdermeeting.com/DAY2024 | Record Date | March 4, |
Meeting Agenda and Voting Recommendations
Proposal | Board of Directors Recommendation | Additional Information | |
Proposal One | Election of directors | FOR each nominee | Page 9 |
Proposal Two | Advisory vote on the | ||
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Your vote is important!Please vote your shares | |||||||
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Internet | Telephone | Virtual Meeting | |||
Go to proxyvote.comup until 11:59 p.m. EDT on April 25, 2024 (Have your proxy card in hand when you visit the website) | Call toll-free at 1-800-690-6903 up until 11:59 p.m. EDT on April 25, 2024 (Have your proxy card in hand when you call) | Complete and | Enter the | ||
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Proposal One:
BOARD OF DIRECTORS AND CORPORATE GOVERNANCEElection of Directors
Board Membership
Our business and affairs are managed under the direction of our Board. Our third amended and restated certificate of incorporation provides that our Board will consist of between one and 14 directors. Pursuant to that certain voting agreement (the “Voting Agreement”) by and among the Company, and certain affiliates of Thomas H. Lee Partners, L.P. (“THL”) and Cannae Holdings, Inc. (“Cannae”), which was spun off from Fidelity National Financial, Inc. (“FNF”), the authorized number of directors has been established at nine directors. During the term of the Voting Agreement, THL and Cannae have certain governance rights, including the right to determine the total number of directors. THL and Cannae together are referred to as the “Sponsors.” Our Board currentlyof Directors ("Board") has one vacancy in Class II and consistsnominated each of eight members: David D. Ossip, Brent B. Bickett, Ronald F. Clarke, William P. Foley, II,Deborah A. Farrington, Thomas M. Hagerty, Linda P. Mantia, David D. Ossip, Ganesh B. Rao, Andrea S. Rosen, and Gerald C. Throop. Throop for election as directors of the Board to hold office until the 2025 annual meeting of stockholders (the "2025 Annual Meeting"). Please see “Proposal One” on page 9 of this Proxy Statement for additional important information about each of the director nominees. Each of the director nominees is a current member of our Board and has consented to serve if elected. The Board recommends a vote “FOR” each director nominee.
| 4 | 2024 PROXY STATEMENT |
Proposal Two:
Advisory Vote on the Compensation of Dayforce’s Named Executive Officers
We are maintaining one vacancyasking our stockholders to approve, on a non-binding, advisory basis, the compensation of our named executive officers ("Named Executive Officers" or "NEOs") as disclosed in the Compensation Discussion & Analysis ("CD&A") tabular disclosures and related narrative of this Proxy Statement. The Board recommends a vote “FOR” approval of NEO compensation because it believes that the policies and practices described in the CD&A section beginning on page 24 of this Proxy Statement are based on principles that reflect a “pay-for-performance” philosophy and are strongly aligned with our stockholders’ interests. Since the vote on this proposal is advisory in nature, it will not affect any compensation already paid or awarded to any NEO and will not be binding on or overrule any decisions by our Compensation Committee or Board. However, because we anticipate electing an independent director tovalue our audit committee by April 30, 2019.stockholders’ view, our Compensation Committee and Board will carefully consider the results of this advisory vote when formulating future executive compensation philosophy, policies, and practices.
Pursuant to the Voting Agreement, for so long as THL and Cannae collectively hold 50% or moreProposal Three:
Ratification of the then outstanding voting power, then THL and Cannae will haveAppointment of KPMG LLP as our Independent Registered Public Accounting Firm for Fiscal Year 2024
Our Audit Committee has appointed KPMG LLP as our independent registered public accounting firm to perform the power to designate a total of five directors to the Board. The allocation of the power to designate the five directors will be determined by reference to the outstanding voting power held by Cannae. If THL and Cannae collectively hold 50% or more of the then outstanding voting power, then:
for so long as Cannae holds at least 12.5% of the then outstanding voting power, THL and Cannae shall have the power to designate (by mutual agreement) five directors to the Board;
for so long as Cannae holds at least 7.5% but less than 12.5% of the then outstanding voting power, THL shall be entitled to designate in its own right four directors and Cannae shall be entitled to designate in its own right one director; and
if Cannae holds less than 7.5% of the then outstanding voting power, THL shall be entitled to designate in its own right all five directors and Cannae shall not be entitled to designate any directors.
As of March 4, 2019, THL and Cannae collectively hold over 50%audit of our outstanding voting power, with THL holding 43.7%consolidated financial statements for the fiscal year ending December 31, 2024, and Cannae holding 23.3%. Thus, THLwe are asking our stockholders to ratify this appointment. The Board recommends a vote “FOR” this ratification.
Corporate Governance Priorities
We remain committed to sound corporate governance practices, and Cannae have together designated Messrs. Bickett, Clarke, Foley, Hagerty and Raoour Board has taken action to our Board.
Once THL and Cannae ceaseadopt measures designed to collectively hold 50% or more ofbolster the then outstanding voting power, then each of THL and Cannae will be able to in their own right designate:
four directors, for so long as it holds at least 40% of the then outstanding voting power;
three directors, for so long as it holds at least 30% of the then outstanding voting power;
two directors, for so long as it holds at least 20% of the then outstanding voting power; and
one director, for so long as it holds at least 10% of the then outstanding voting power.
The Voting Agreement will terminate as to each Sponsor when the Sponsor is no longer entitled to designate a director toindependent leadership on the Board and will terminate uponestablish additional meaningful stockholder rights while continuing to maintain best practice efforts adopted previously.
Board Composition and Refreshment
Our Board believes in the time when neither Sponsor is entitled to designate a directorimportance of achieving and maintaining the proper composition with an appropriate mix of skills and experience. We are proud that our entire Board boasts experience relevant to the Board.oversight of our long-term strategy – including in areas such as strategic transformation leadership, technology or software, and human resources or talent management.
| 5 | 2024 PROXY STATEMENT |
Independent Board Oversight
Our third amended and restated certificate of incorporation provides that our Board is divided into three classes,committed to providing frank, strategic leadership, independent from management.
Corporate Governance Best Practices
The Board has routinely evaluated our policies and practices against evolving best practices for alignment with one class being elected at each annual meeting of stockholders. Each director serves a three-year term, with termination staggered according to class. Class I consists of three directors, Class II consists of two directors,stockholder interests. Key policies and Class III consists of three directors. The Class I directors, whose terms will expire at the Annual Meeting, are Messrs. Bickett, Clarke, and Rao. The Class II directors, whose terms will expire at the 2020
Annual Meeting of Stockholders, are Messrs. Foley and Hagerty. The Class III directors, whose terms will expire at the 2021 Annual Meeting of Stockholders, are Messrs. Ossip and Throop and Ms. Rosen.
Director Nominees and Continuing Directors
The following table sets forth summary information regarding each director nominee and continuing director as of March 4, 2019:
Board Governance Procedures | Board Governance Policies |
✓ Annual Board and Committee self-evaluations ✓ Board Orientation Program for new directors ✓ Regular executive sessions of independent directors ✓ Robust stockholder engagement program ✓ Annual director elections* ✓ Majority voting for election of directors with resignation policy* ✓ Formalized oversight responsibility for management succession planning* | ✓ Corporate Governance Guidelines ✓ Director “Overboarding” Guidelines ✓ Stock Ownership Guidelines ✓ No-Hedging and No-Pledging Policy ✓ Related Person Transactions Policy *Newly adopted since previous annual meeting |
Executive Compensation Priorities
Our Board continues to focus on building and maintaining an executive compensation program that is significantly performance-based and stockholder aligned. We believe our executive compensation program was effective in incentivizing strong financial performance during the period from January 1, 2023, through December 31, 2023 (“Fiscal Year 2023”), which included the highlights described in "Business Highlights" on page 2 of this Proxy Statement. The Board believes the key underpinnings of growth were directly connected to the performance components of the Fiscal Year 2023 performance compensation program.
Executive Compensation Program Best Practices
We have worked closely with our independent compensation consultant, our stockholders, and other stakeholders to continue incorporating best practices into our executive compensation program. Key policies and practices we have adopted since our initial public offering include:
Compensation Procedures | Compensation Policies |
✓ “Pay for Performance” with majority of compensation “at risk” ✓ Current peer group of 17 companies ✓ Independent compensation consultant ✓ “Double trigger” acceleration following a change in control ✓ Limited executive perquisites ✓ Robust stockholder engagement program | ✓ Stock Ownership Guidelines for Senior Management ✓ Compensation Recovery (Clawback) Policy ✓ No-Hedging and No-Pledging Policy |
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The biographies of each of the nominees and continuing directors, below, contain information regarding each such person’s service as a director, business experience, public company director positions held currently or at any time during the last five years and the experience, qualifications, attributes or skills that caused our Board to determine that the person should serve as a director of the Company. In addition to the information presented below regarding each nominee’s and continuing director’s specific experience, qualifications, attributes and skills that led the Board to the conclusion that such person should serve as a director, we also believe that each of our directors has a reputation for integrity, honesty and adherence to high ethical standards. Each of our directors has demonstrated business acumen and an ability to exercise sound judgment, as well as a commitment of service to us and our Board. Finally, we value our directors’ experience in relevant areas of business management and on other boards of directors and board committees.
Information Concerning Nominees for Election for a Three-Year Term Ending at the 2022 Annual Meeting
Brent B. Bickett. Mr. Bickett has served as a director since November 2007. Mr. Bickett is currently the president of Cannae, a position he has held since April 2017. Mr. Bickett also holds the position of executive vice president of corporate strategy at FNF, which he joined in January 1999. Mr. Bickett currently serves as a director of American Blue Ribbon Holdings, LLC, and Colt Holdings, LLC., each a private company. Mr. Bickett previously served as a director for Digital Insurance, Inc., J. Alexander’s Holdings, Inc., Old Remco Holdings, L.L.C., and Remy International, Inc. We believe that Mr. Bickett’s extensive investment, management, transaction, and corporate strategy expertise make him well qualified to serve as a director.
Ronald F. Clarke. Mr. Clarke has served as a director since July 2018. Mr. Clarke has been the chief executive officer of FleetCor Technologies since August 2000 and has served as chairman of its board of directors since March 2003. We believe that Mr. Clarke’s management and leadership experience make him well-qualified to serve as a director.
Ganesh B. Rao. Mr. Rao has served as a director since November 2007. Mr. Rao is a managing director of THL, which he joined in 2000. Prior to joining THL, Mr. Rao worked at Morgan Stanley & Co. Incorporated in the mergers & acquisitions department. Mr. Rao is currently a director of Black Knight, Inc. and MoneyGram International, Inc. Mr. Rao also serves on the following private company boards: Prime Risk Partners Inc.;Ten-X Commercial; Auction.com, Inc.; ServiceLink Holdings, LLC; and Hightower Advisors, LLC. Mr. Rao formerly served as a director for Nielsen Holdings N.V. and LifeWorks Corporation. We believe that Mr. Rao’s managerial and strategic expertise working with large growth-oriented companies as a managing director of THL and his experience enhancing value at such companies make him well-qualified to serve as a director.
Information Concerning Directors Continuing in Office Until the 2020 Annual Meeting
Thomas M. Hagerty. Mr. Hagerty has served as a director since November 2007. Mr. Hagerty has also served as a director of FNF since 2005. In addition, Mr. Hagerty is a managing director of THL, which he joined in 1988. Mr. Hagerty also serves as a director of Black Knight, Inc., FleetCor Technologies Inc., and ServiceLink Holdings, LLC., a private company. Mr. Hagerty previously served as a director for MoneyGram International, Inc., First Bancorp and Fidelity National Information Services, Inc. We believe that Mr. Hagerty’s managerial and strategic expertise working with large growth-oriented companies as a managing director of THL, and his experience in enhancing value at such companies, along with his expertise in corporate finance make him well-qualified to serve as a director.
William P. Foley, II.Mr. Foley has served as a director since September 2013. Mr. Foley currently holds the position of executive chairman at Black Knight, Inc., and its predecessors, a position he has held since January 2014, the position of chairman of Cannae, a position he has held since May 2018, and the position of chairman of FNF, a position he has held since 1984. Mr. Foley served as executive chairman of Cannae from April 2017 until May 2018, and executive chairman of FNF from October 2006 until January 2016. Mr. Foley is the executive chairman of Dun & Bradstreet, theco-executive chairman of FGL Holdings, thenon-executive chairman of Foley Family Wine Holdings, Inc., a privately ownednon-operating holding company, and the executive chairman and CEO of Black Knight Sports and Entertainment LLC. In addition, Mr. Foley also serves as a director for Foley Family Charitable Foundation and Cummer Museum of Arts and Gardens, and he is the founder, trustee and director of The Folded Flag Foundation. Mr. Foley previously served as a director for Fidelity National Information Services, Inc., and Remy International, Inc. We believe that Mr. Foley’s depth and expertise in managing and, as a member of the board of directors, leading a variety of businesses across many industries make him well-qualified to serve as a director.
Information Concerning Directors Continuing in Office Until the 2021 Annual Meeting
David D. Ossip. Mr. Ossip is our Chair of the Board and Chief Executive Officer, positions he has held since August 2015 and July 2013, respectively. Mr. Ossip joined us following our acquisition of Dayforce Corporation in 2012, where he held the position of chief executive officer. Mr. Ossip is currently a director for Ossip Consulting Inc., OSDAC Corp., and 100 Wingarden Properties Ltd., each a private company. We believe that Mr. Ossip’s managerial and strategic expertise along with his deep knowledge of our industry make him well-qualified to serve as a director.
Andrea S. Rosen. Ms. Rosen has served as a director since July 2018. In addition, Ms. Rosen has served as a director of Emera Inc. since 2007 and Manulife Financial Corporation since 2011. Ms. Rosen was vice chair of TD Bank Financial Group and president of TD Canada Trust from 2002 to 2005. Previously, she was executive vice president of TD Commercial Banking and vice chair of TD Securities. Further, she has served as a director of Alberta Investment Management Corporation from 2008 until 2017 and Hiscox Ltd., a company listed on the London Stock Exchange from 2006 until 2015. We believe that Ms. Rosen’s experience on boards of directors and her strategic experience in those roles make her well-qualified to serve as a director.
Gerald C. Throop. Mr. Throop has served as a director since April 2018. In addition, Mr. Throop currently serves as a director of Nasdaq Canada Inc., a wholly-owned subsidiary of The Nasdaq Stock Market Inc. Since 2011, Mr. Throop has worked independently as a private equity investor, director, and advisor to early stage companies. Prior to 2011, he spent 17 years in executive leadership positions in the securities and banking industry, including the position of executive vice president, managing director, and head of equities for both National Bank of Canada and Merrill Lynch Canada. Mr. Throop has served as either a member of the board of directors or the chief financial officer of several companies that were Toronto Stock Exchange listed at the time of his service, including Workbrain Corporation, Toronto Stock Exchange,Call-Net Enterprises/Sprint Canada Inc., and Tie Telecommunications Canada Limited. Mr. Throop is a Chartered Public Accountant. We believe that Mr. Throop’s financial, managerial, and investment experiences make him well-qualified to serve as a director.
Code of Conduct
We have a Code of Conduct that applies to all of our employees, officers and directors. A copy of the Code of Conduct is availableFor more information on our website located atwww.ceridian.com. Any amendments or waivers fromexecutive compensation program, please see our CodeCD&A beginning on page 24 of Conduct granted to directors or executive officers will be disclosed on our website promptly following the date of such amendment or waiver.this Proxy Statement.
Corporate Governance Guidelines
Our Board has adopted corporate governance guidelines in accordance with the corporate governance rules of the New York Stock Exchange (“NYSE”) and the Toronto Stock Exchange (“TSX”), which serve as a flexible framework within which our Board and its committees operate. These guidelines cover a number of areas, including Board composition, roles of the chair and lead independent director, director nominations and Board criteria, Board meetings and executive sessions, Board committees, management succession, Board compensation, expectations of directors, Board performance evaluations, and access to management and outside advisors. Robust Stockholder Engagement
A copykey component of our corporate governance guidelinesprogram is posted on our website atwww.ceridian.com.annual stockholder engagement process, as our Board is committed to engaging stockholders in the governance process.
Indemnification
Since our previous annual meeting, we reached out to stockholders holding approximately 84.2% of Directors and Officers
Our third amended and restated certificate of incorporation provides that we will indemnify our directors and officers to the fullest extent permitted by the Delaware General Corporation Law (“DGCL”).
We have entered into indemnification agreements with eachshares of our directors. These indemnification agreements provide the directors with contractual rightsoutstanding common stock, $0.01 par value (“Common Stock”) as of June 30, 2023, in order to indemnification and expense advancement and reimbursement to the fullest extent permitted under the DGCL, subject to certain exceptions contained in those agreements.
Board’s Role in Risk Oversight
Our Board’s role in overseeing the management of our risks is conducted primarily through committees of our Board, as disclosed in the descriptions of each of the committees, below, and in the charters of each of the committees. Our full Board (or the appropriate board committee in the case of risks that are under the purview of a particular committee) discusses with management our major risk exposures, including cyber risk,better understand their potential impactfeedback on us and the steps we take to manage them. When a Board committee is responsible for evaluating and overseeing the management of a particular risk or risks, the chair of the relevant committee reports on the discussion to the full Board during the committee reports portion of the next Board meeting. This enables the Board and its committees to coordinate the risk oversight role, particularly with respect to risk interrelationships.
Director Independence and Controlled Company Exemption
Our Sponsors beneficially own more than 50% of the voting power for the election of directors. As a result, we qualify as a “controlled company” under the rules of the NYSE. “Controlled companies” under those rules are companies of which more than 50% of the voting power for the election of directors is held by an individual, a group or another company. On this basis, we will continue to avail ourselves of the “controlled company” exemption under the corporate governance rules of the NYSE. As a controlled company, we are not required to have a majority of “independent directors” (as defined under the rules of the NYSE) on our Board; or have aexecutive compensation, committee and a corporate governance, and nominating committee composed entirely of independent directors. The “controlled company” exemption does not modify the independence requirements for the audit committee. The NYSEEnvironmental, Social, and the SEC rules require that our audit committee be composed of at least three members, subject to certain permittedphase-in rules for newly public companies. We are currently in compliance with these“phase-in” provisions, with two of the three members of our audit committee satisfying applicable independence requirementsGovernance ("ESG") matters. Our (i) Lead Director and we intend for all members of the audit committee to meet the required independence standards within one year of our IPO (April 30, 2019).
Additionally, even though we qualify as a controlled company, we have a majority of independent directors serving on our Board. Our Board has affirmatively determined that Messrs. Bickett, Clarke, Foley, and Throop and Ms. Rosen are independent directors under the applicable rules of the NYSE. In assessing the independence of Messrs. Bickett, Foley, Hagerty, and Rao, the Board considered their relationships with the Sponsors, as well as their interests, as applicable, in any related party transactions described below under “Certain Relationships and Related Party Transactions”.
If at any time we cease to be a “controlled company” under the rules of the NYSE, our Board will take all action necessary to comply with the corporate governance rules of the NYSE, including as applicable, appointing a majority of independent directors to the Board and establishing certain committees composed entirely of independent directors, subject to a permitted“phase-in” period. We are currently in compliance with the applicable“phase-in” provisions.
Board Leadership Structure
Mr. Ossip, our Chief Executive Officer, serves as Chair of our Board. He presides over meetings of our Board and holds such other powers and carries out such other duties as are customarily carried out by theAudit Committee; (ii) Chair of our Board. Our Board believes that the current board leadership structure provides effective independent oversight of management while allowing our Board and management to benefit from Mr. Ossip’s leadership and years of managerial and strategic experience. Mr. Ossip is best positioned to identify strategic priorities, lead critical discussions and execute our strategy and business plans, and he possesses detailedin-depth knowledge of the issues, opportunities and challenges facing us. Our Board believes that Mr. Ossip’s combined role enables strong leadership, creates clear accountability, facilitates information flow between management and our Board and enhances our ability to communicate our message and strategy clearly and consistently to our stockholders.
Meetings of the Board of Directors and Stockholders
Our Board held five meetings in fiscal year 2018. Each director attended at least 75 percent of all meetings of the Board and the committees on which they served that were held during fiscal year 2018 (and to the extent that such meetings were held during the time that each director served on our Board). All directors are encouraged to attend our annual meetings of stockholders.
Committees of the Board of Directors
Our Board has established an audit committee, a compensation committee and a corporate governance and nominating committee. Each committee operates under a charter that has been approved by our Board and has
the composition and responsibilities described below. Members serve on these committees until their resignations or until otherwise determined by our Board. The charter of each committee is available on our website atwww.ceridian.com.
Audit Committee
The primary purposes of our audit committee is to assist the Board’s oversight of, among other things:
audits of our financial statements;
the integrity of our financial statements;
our process relating to risk management and the conduct and systems of internal control over financial reporting and disclosure controls and procedures;
the qualifications, engagement, compensation, independence, and performance of our independent auditor; and
the performance of our internal audit function.
The audit committee is currently composed of Messrs. Rao and Throop and Ms. Rosen. Mr. Throop serves as chair of the audit committee and each of Mr. Throop and Ms. Rosen qualify as an “audit committee financial expert” as such term has been defined by the SEC in Item 407(d) ofRegulation S-K. Our Board has affirmatively determined that each of Ms. Rosen and Mr. Throop meet the definition of an “independent director” for the purposes of serving on the audit committee under applicable NYSE rules andRule 10A-3 under the Exchange Act. In accordance with the NYSE and the SEC rules, we intend for all members of the audit committee to meet the required independence standards within one year of our IPO. In connection therewith, Mr. Rao will step down from the audit committee by theone-year anniversary of our IPO (April 30, 2019), and we intend to appoint a new independent director by such date. The audit committee is governed by a charter that complies with the rules of the NYSE.
The audit committee met five times during the year ended December 31, 2018.
Compensation Committee
The primary purposes of our compensation committee is to assist the Board in overseeing our management compensation policies and practices, including, among other things:
determining and approving the compensation of our executive officers;
reviewing and approving incentive compensation awards to executive officers; and
make recommendations to the Board with respect to all equity-based compensation plans.
Our compensation committee is composed of Messrs. Clarke, Foley, Hagerty, and Rao. Mr. Hagerty serves as chair of the compensation committee. We have elected to avail ourselves of the “controlled company” exemption under the rules of the NYSE, which exempts us from the requirement that we have a compensation committee composed entirely of independent directors. The compensation committee is governed by a charter that complies with the rules of the NYSE.
The compensation committee met three times during the year ended December 31, 2018.
Compensation Committee Interlocks and Insider Participation
No member of our compensation committee has ever been one of our executive officers or employees. None of our executive officers currently serves, or in the past year has served, as a member of the board of directors or
compensation committee of any entity that has one or more executive officers serving on our Board or compensation committee.
Corporate Governance and Nominating CommitteeCommittee; and/or (iii) key members of our management team participated in meetings with stockholders holding approximately 63.8% of the outstanding Common Stock of the Company as of June 30, 2023.
The primary purposes
Reached out to stockholders 84.2% of the outstanding Common Stock of the Company to offer engagement sessions | Directors and/or management met with 63.8% of the outstanding Common Stock of the Company to discuss compensation, corporate governance, and ESG matters |
Key Actions Taken in Response to Stockholder Feedback
Stockholders have expressed overall support for the direction of our corporate governance and nominating committee is to, among other things:
subjectESG programs. In particular, stockholders appreciated Board responsiveness to the requests for annual election of directors and a majority vote standard in director designation rightselections with a resignation policy, both of THLwhich have been fully implemented this year.
Our Board has consistently focused on incorporating stockholder feedback into our executive compensation programs. Holders of approximately 96.7% of our outstanding stock represented and Cannae undervoting at Dayforce's annual meeting of stockholders (the "2023 Annual Meeting") voted in favor of our Say on Pay proposal – a significant improvement of approximately 27.2% from the Voting Agreement,make recommendations2022 annual meeting of stockholders (the "2022 Annual Meeting") results. We believe open dialogue with our stockholders and incorporation of their feedback into our executive compensation program was instrumental in the continued growth in stockholder support for our compensation program at the 2023 Annual Meeting.
The following actions which were taken in 2023 in response to stockholder feedback following our 2022 Annual Meeting:
Following the strong results on our Say on Pay proposal at our 2023 Annual Meeting, we continued to receive positive feedback from stockholders that was very supportive of the changes we made in 2023 and the overall evolution of our compensation programs since our initial public offering in 2018. As such, we followed a similar
| 7 | 2024 PROXY STATEMENT |
paradigm in designing our 2024 compensation program. We will continue to engage with our stockholders and consider actions based on that feedback.
For more information on our stockholder engagement program and on the compensation program changes made in response to stockholder feedback, please see "Stockholder Feedback" on page 27 of this Proxy Statement, within our CD&A.
| 8 | 2024 PROXY STATEMENT |
Dayforce, Inc.
3311 East Old Shakopee Road
Minneapolis, Minnesota 55425
2024 PROXY STATEMENT
Our Board regarding nominationsolicits your proxy on our behalf for the 2024 Annual Meeting, and at any adjournment, continuation, or postponement of individuals as membersthe 2024 Annual Meeting, for the purposes set forth in this Proxy Statement and the accompanying Notice of theBoard2024 Annual Meeting of Stockholders (the “Notice of Internet Availability”).
In this Proxy Statement, the terms “Dayforce,” “the Company,” “we,” “us,” and “our” refer to Dayforce, Inc. and its committees;subsidiaries. The mailing address of our principal executive office is Dayforce, Inc., 3311 East Old Shakopee Road, Minneapolis, Minnesota 55425.
PROPOSAL ONE Election of Directors |
assist
The Board has nominated each of Brent B. Bickett, Ronald F. Clarke, Deborah A. Farrington, Thomas M. Hagerty, Linda P. Mantia, David D. Ossip, Ganesh B. Rao, Andrea S. Rosen, and Gerald C. Throop for election as directors of the Board. At the 2024 Annual Meeting and at each annual meeting thereafter, all directors shall be elected to hold office for a one-year term expiring at the next annual meeting of stockholders.'
Board withSelection Criteria
Pursuant to our Corporate Governance Guidelines and the Corporate Governance and Nominating Committee charter, the Corporate Governance and Nominating Committee is responsible for identifying individuals qualified to become Board members;members, consistent with criteria approved by the Board, and
determine corporate governance practices and related matters.
Our corporate governance and nominating committee is comprised of Messrs. Bickett and Throop. Mr. Bickett serves as chair of the corporate governance and nominating committee. The corporate governance and nominating committee is governed by a charter that complies with the rules of the NYSE.
The corporate governance and nominating committee met two times during the year ended December 31, 2018.
Identifying and Evaluating Director Nominees
The Board has delegated to the corporate governance and nominating committee the responsibility of identifying suitable candidates for nominationrecommend to the Board (including candidatesthe nominees to fill any vacancies that may occur)stand for election as directors at the annual meeting of stockholders.
The Corporate Governance and assessing their qualificationsNominating Committee has recommended, and the Board has nominated, each nominee for election to the Board after considering the following criteria:
Board Diversity
As described above, the Board carefully considers the diversity of viewpoints, background, experience, and other criteria for selection of directors as established by the Board. The corporate governance and nominating committee may gather information about the candidates through interviews, detailed questionnaires, comprehensive background checks or any other means that the committee deems to be appropriatedemographics in the evaluation process. Based on the results of the evaluation process, the corporate governance and nominating committee recommends new candidates for the Board’s approval as directorselecting nominees for election to the Board.
In identifying prospective director candidates, the corporate governance and nominating committee may consider all facts and circumstances that it deems appropriate or advisable, including, among other things, such factors as integrity, experience, judgment, independence, diversity, skills, education, expertise, length of service, understanding of our business and industry, other commitments and the size and composition This section provides an overview of the Board. Although ourinformation relied upon by the Board does not currently maintain a specific policy with respectin performing this analysis.
Demographic Diversity
The Board also takes the ethnic and gender diversity of its membership into account when selecting nominees for election to board diversity,the Board.
| 9 | 2024 PROXY STATEMENT |
Skill Diversity
The Board relies on the matrix below which summarizes what our Board believes that it should be a diverse body reflectingare desirable types of experience, qualifications, attributes, and skills possessed by one or more of our business, workforce, customer base and society in general, and our Board has directed our corporate governance and nominating committee to consider the benefits of diverse viewpoints when making determinations regarding nominations of directors in orderselecting nominees for election to ensure a diverse mix of skills, background and experience. As we work to expand the number of independent directors on our Board, we will continue to consider a diverse group of potential candidates.Board.
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Strategic Transformation Leadership (Experience driving strategic direction and growth of an organization shifting its business strategy) | ● | ● | ● | ● | ● | ● | ● | ● | ● | 9 |
Public Company Board Service | ● | ● | ● | ● | ● | ● | ● | ● | ● | 9 |
C Suite / Senior Management Leadership | ● | ● | ● | ● | ● | ● | ● | ● | 8 | |
Industry Background (Human Capital Management, Financial Services, Fintech, Payments) | ● | ● | ● | ● | ● | ● | ● | ● | ● | 9 |
Technology or Software Experience (Implementing technology strategies for long-term R&D, planning, and strategy) | ● | ● | ● | ● | ● | ● | ● | ● | 8 | |
Financial Literacy (Experience or expertise in financial accounting and reporting or financial management) | ● | ● | ● | ● | ● | ● | ● | ● | ● | 9 |
Global Business Background (Experience and exposure to markets and cultures outside the U.S.) | ● | ● | ● | ● | ● | ● | ● | ● | ● | 9 |
Mergers & Acquisitions / Corporate Finance | ● | ● | ● | ● | ● | ● | ● | ● | ● | 9 |
Human Resources / Talent Management | ● | ● | ● | ● | ● | 5 | ||||
Enterprise Risk Management / Cybersecurity | ● | ● | ● | ● | ● | ● | ● | 7 | ||
Environmental, Social, & Governance (Experience in ESG, community affairs, and/or corporate responsibility including sustainability, diversity, and inclusion) | ● | ● | ● | ● | ● | ● | ● | 7 |
| 10 | 2024 PROXY STATEMENT |
Stockholder Recommendations
The Board will consider all submitted stockholder recommendations for Board nominees in making its nominations. Stockholders may submit recommendations for director candidates to the corporate governanceCorporate Governance and nominating committeeNominating Committee by sending the individual’s name and qualifications to our Secretary,Dayforce, Inc., c/o Ceridian HCM Holding Inc.,Corporate Secretary, 3311 East Old Shakopee Road, Minneapolis, Minnesota 55425, who55425. The Corporate Secretary will forward all stockholder recommendations to the corporate governanceCorporate Governance and nominating committee.Nominating Committee. The corporate governanceCorporate Governance and nominating committeeNominating Committee will evaluate any candidates recommended by stockholders against the same criteria and pursuant to the same policies and procedures applicable to the evaluation of candidates proposed by directors or management.
Stockholder CommunicationsDirector Nominees
The Board provides to every stockholder the ability to communicate with the Board through an established process for stockholder communications. Stockholders and other interested parties may send such communication to our Secretary at stockholders@ceridian.com or via U.S. mail: Secretary, c/o Ceridian HCM Holding Inc., 3311 East Old Shakopee Road, Minneapolis, Minnesota 55425, Attn: Board of Directors.
The Secretary will review all such incoming communications and forward any stockholder communication to the appropriate member(s) of the Board. The Secretary will generally not forward communications that are unrelated to the duties and responsibilities of the Board, including communications that the Secretary determines to be primarily commercial in nature, product complaints or inquiries, or materials that are patently offensive or otherwise inappropriate.
ELECTION OF DIRECTORS
Nominees
Our Board has nominated each of Brent B. Bickett, Ronald F. Clarke, andDeborah A. Farrington, Thomas M. Hagerty, Linda P. Mantia, David D. Ossip, Ganesh B. Rao, Andrea S. Rosen, and Gerald C. Throop for election as Class I directors of the Board to hold office until the 20222025 Annual Meeting or until their successors are duly elected and qualified, subject to their earlier death, resignation, or removal. Each of the nominees is a current member of our Board and has consented to serve if elected.
Unless you direct otherwise through your proxy voting instructions, the persons named as proxies will vote all proxies received “FOR” the election of each of the nominees. If any nominee is unable or unwilling to serve at the time of the Annual Meeting, the persons named as proxies may vote for a substitute nominee chosen by the present Board. In the alternative, the proxies may vote only for the remaining nominees, leaving a vacancy on the Board. The Board may fill such vacancy at a later date or reduce the size of the Board. We have no reason to believe that any of the nominees will be unwilling or unable to serve if elected as a director.
Information Concerning Nominees for Election for a One-Year Term Ending at the2025 Annual Meeting
The biographies of each of the nominees contain information regarding each such person’s service as a director, business experience, public company director positions held as of February 28, 2024, and at any time during the last five years, and the experience, qualifications, attributes, or skills that caused our Board to determine that the person should serve as a director of the Company.
Brent B. Bickett Age 59 Director since 2013 Independent Committees • Acquisition and Finance • Compensation (Chair) • Corporate Governance and Nominating | Background | |
Mr. Bickett has served as a director of Dayforce, Inc. since December 2013. He also served as a director or manager for other Dayforce entities between May 2007 and April 2018. Mr. Bickett currently serves as president and chief executive officer of 3B Capital Partners, Inc., a private principal investment and capital advisory company. Mr. Bickett previously served as president until December 2020 and senior advisor until December 2021 for Cannae Holdings, Inc. (“Cannae”), a New York Stock Exchange (“NYSE”) listed diversified investment company. Mr. Bickett also previously served as president and executive vice president of corporate strategy at Fidelity National Financial, Inc., a leading provider of title insurance and real estate settlement services. | ||
Qualifications | ||
We believe that Mr. Bickett’s extensive investment, management, transaction, capital allocation, and corporate strategy expertise make him well-qualified to serve as a director. | ||
Other Current Public Company Boards | ||
None. |
| 11 | 2024 PROXY STATEMENT |
Ronald F. Clarke Age 68 Director since 2018 Independent Committees • Compensation | Background Mr. Clarke has served as a director of Dayforce, Inc. since July 2018. Mr. Clarke has been the chief executive officer of FleetCor Technologies, Inc., a leading global business payments company and a NYSE listed company, since August 2000 and has served as chairman of its board of directors since March 2003. From 1999 to 2000, Mr. Clarke served as president and chief operating officer of AHL Services, Inc., a staffing firm. From 1990 to 1998, Mr. Clarke served as chief marketing officer and later as a division president with Automatic Data Processing, Inc., a computer services company. From 1987 to 1990, Mr. Clarke was a principal with Booz Allen Hamilton, a global management consulting firm. Earlier in his career, Mr. Clarke was a marketing manager for General Electric Company, a diversified technology, media, and financial services corporation. | |
Qualifications We believe that Mr. Clarke’s management and leadership experience make him well-qualified to serve as a director. | ||
Other Current Public Company Boards FleetCor Technologies, Inc. |
Deborah A. Farrington Age 73 Director since 2019 Independent Committees • Acquisition and Finance • Audit • Corporate Governance and Nominating (Chair) | Background | |
Ms. Farrington has served as a director of Dayforce, Inc. since April 2019. Ms. Farrington is a founder and President of StarVest Management, Inc., the management company for the StarVest funds, and since 1999 has been a general partner of StarVest Partners, L.P., an expansion stage venture capital and growth equity firm. Ms. Farrington currently serves on the board of directors of Cumulus Media Inc., a Nasdaq listed company. Within the past five years, Ms. Farrington served on the board of directors of NCR Corporation, a NYSE listed company, as well as on the board of directors of the following companies which were publicly listed at the time of her service: Collectors Universe, Inc., formerly a Nasdaq listed company, and RedBall Acquisition Corp., formerly a NYSE listed company. Earlier in her career, Ms. Farrington was an investment banker and executive with Merrill Lynch & Co., an investment bank. | ||
Qualifications | ||
We believe that Ms. Farrington’s executive leadership and extensive experience on boards of directors, as well as her experience in software and financial services, make her well-qualified to serve as a director. | ||
Other Current Public Company Boards | ||
Cumulus Media Inc. |
| 12 | 2024 PROXY STATEMENT |
Thomas M. Hagerty Age 61 Director since 2013 Independent Committees • Acquisition and Finance (Chair) • Compensation | Background | |
Mr. Hagerty has served as a director of Dayforce, Inc. since September 2013, and other Dayforce entities between April 2008 and April 2018. Mr. Hagerty is a managing director of Thomas H. Lee Partners, L.P. (“THL”), a private equity firm, which he joined in 1988. Mr. Hagerty currently serves on the board of directors of Dun & Bradstreet Holdings, Inc., Fidelity National Financial, Inc., and FleetCor Technologies, Inc., all NYSE listed companies. Within the past five years, Mr. Hagerty also served as a director for Black Knight, Inc. and Foley Trasimene Acquisition Corp., both NYSE listed companies at the time of his service. | ||
Qualifications | ||
We believe that Mr. Hagerty’s managerial and strategic expertise working with large growth-oriented companies as a managing director of THL and his experience in enhancing value at such companies, along with his expertise in corporate finance, make him well-qualified to serve as a director. | ||
Other Current Public Company Boards | ||
Dun & Bradstreet Holdings, Inc. Fidelity National Financial, Inc. FleetCor Technologies, Inc. |
Linda P. Mantia Age 55 Director since 2020 Independent Committees • Audit • Corporate Governance and Nominating | Background | |
Ms. Mantia has served as a director of Dayforce, Inc. since June 2020. In addition, Ms. Mantia currently serves on the board of directors of Maple Leaf Foods Inc., a Toronto Stock Exchange (“TSX”) listed company, and McKesson Corporation, a NYSE listed company. Previously, she served on the board of MindBeacon Holdings Inc., a TSX listed company at the time of her service. Prior to joining our Board, Ms. Mantia was Senior Executive Vice President, Chief Operating Officer of Manulife Financial Corporation, an international insurance and financial service company listed on the NYSE and TSX. Ms. Mantia also previously served as Executive Vice President of Digital Banking, Payments and Cards at Royal Bank of Canada (“RBC”), a multinational financial services company listed on the NYSE, as well as in other leadership roles at RBC, including Executive Vice President, Global Cards and Payments. Earlier in her career, Ms. Mantia worked at McKinsey & Co., a global management consulting firm, and prior to that, she practiced law at Davies Ward Phillips & Vineberg LLC. | ||
Qualifications | ||
We believe that Ms. Mantia’s executive leadership roles and her financial services, payments, and digital technology experience make her well-qualified to serve as a director. | ||
Other Current Public Company Boards | ||
Maple Leaf Foods Inc. McKesson Corporation |
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David D. Ossip Age 57 Director and Chair of the Board since 2015 Non-Independent Committees None. | Background | |
Mr. Ossip is Chair of the Board and Chief Executive Officer ("CEO") for Dayforce, Inc. Mr. Ossip has held the position of Chair since August 2015 and CEO since November 2023. Previously, Mr. Ossip served as Co-CEO of Dayforce from February 2022 until November 2023, and CEO of Dayforce from July 2013 until February 2022. Mr. Ossip joined Dayforce following the acquisition of Dayforce Corporation in 2012, where he held the position of chief executive officer. Within the past five years, Mr. Ossip served as a director for the following companies which were publicly listed at the time of his service: Dragoneer Growth Opportunities Corp., a NYSE listed company, Dragoneer Growth Opportunities Corp. II, a Nasdaq listed company, and Dragoneer Growth Opportunities Corp. III, a Nasdaq listed company. | ||
Qualifications | ||
We believe that Mr. Ossip’s managerial and strategic expertise along with his deep knowledge of our industry make him well-qualified to serve as a director. | ||
Other Current Public Company Boards | ||
None. |
Ganesh B. Rao Age 47 Director since 2013 Independent Committees • Acquisition and Finance • Corporate Governance and Nominating | Background | |
Mr. Rao has served as a director of Dayforce, Inc. since September 2013, and other Dayforce entities between May 2013 and April 2018. Mr. Rao is a managing director of THL, a private equity firm, which he joined in 2000. Prior to joining THL, Mr. Rao worked at Morgan Stanley & Co. Incorporated in the mergers & acquisitions department. Mr. Rao currently serves on the board of directors of Dun & Bradstreet Holdings, Inc., a NYSE listed company. Previously, Mr. Rao also served as a director for Black Knight, Inc., a NYSE listed company at the time of his service, and MoneyGram International, Inc., a Nasdaq listed company. | ||
Qualifications | ||
We believe that Mr. Rao’s managerial and strategic expertise working with large growth-oriented companies as a managing director of THL and his experience enhancing value at such companies make him well-qualified to serve as a director. | ||
Other Current Public Company Boards | ||
Dun & Bradstreet Holdings, Inc. |
| 14 | 2024 PROXY STATEMENT |
Andrea S. Rosen Age 69 Director since 2018 Independent Committees • Audit • Compensation | Background | |
Ms. Rosen has served as a director of Dayforce, Inc. since July 2018. In addition, Ms. Rosen serves on the board of directors of Element Fleet Management Corp., a TSX listed company, Emera Inc., a TSX listed company, and Manulife Financial Corporation, a NYSE and TSX listed company. Ms. Rosen was vice chair of TD Bank Financial Group, a company which offered a full range of financial products and services, and president of TD Canada Trust from 2002 to 2005. Previously, she was executive vice president of TD Commercial Banking and vice chair of TD Securities. | ||
Qualifications | ||
We believe that Ms. Rosen’s experience on boards of directors and her strategic experience in those roles make her well-qualified to serve as a director. | ||
Other Current Public Company Boards | ||
Element Fleet Management Corp. Emera Inc. Manulife Financial Corporation |
Gerald C. Throop Age 66 Director since 2018 and Lead Director since 2019 Independent Committees • Audit (Chair) | Background | |
Mr. Throop has served as a director of Dayforce, Inc. since April 2018 and Lead Director since November 2019. In addition, Mr. Throop currently serves on the board of directors of FleetCor Technologies, Inc., a NYSE listed company. Since 2011, Mr. Throop has worked independently as a private equity investor, director, and advisor to early-stage companies. Prior to 2011, he spent 17 years in executive leadership positions in the securities and banking industry, including the position of executive vice president, managing director, and head of equities for both National Bank of Canada and Merrill Lynch Canada. Mr. Throop has served as either a member of the board of directors or the chief financial officer of several companies that were TSX listed at the time of his service, including Workbrain Corporation, Toronto Stock Exchange, Call-Net Enterprises/ Sprint Canada Inc., and Tie Telecommunications Canada Limited. Mr. Throop is a Chartered Public Accountant. | ||
Qualifications | ||
We believe that Mr. Throop’s financial, managerial, and investment experience make him well-qualified to serve as a director. | ||
Other Current Public Company Boards | ||
FleetCor Technologies, Inc. |
Recommendation of the Board
The Board believes the collective experience, qualifications, attributes, and skills possessed by each nominee make them well-qualified to exercise oversight responsibilities on behalf of our stockholders. In addition to each nominee’s specific qualifications that led the Board to the conclusion that such person should serve as a director, we also believe that each of our directors has a reputation for integrity, honesty, and adherence to high ethical standards. Each of our directors has demonstrated business acumen and an ability to exercise sound judgment, as well as a commitment of service to us and our Board. Finally, we value our directors’ experience in relevant areas of business management and on other boards of directors and board committees. As a result, the Board recommends that you vote “for” the election of each of the nominees.
THE BOARD RECOMMENDS THAT YOU VOTE “FOR” THE ELECTION OF EACH OF THE NOMINEES. |
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BOARD OF DIRECTORS |
Director Independence
We have a majority of independent directors serving on our Board, and each of the committees of our Board are comprised solely of independent directors. Our Board has affirmatively determined that Messrs. Bickett, Clarke, Hagerty, Rao, and Throop, and Mses. Farrington, Mantia, and Rosen are independent directors under the applicable rules of the NYSE after considering, among other things, their interests, as applicable, in any related party transactions described below under “Certain Relationships and Related Party Transactions” on page 63. | INDEPENDENT DIRECTORS | |
89% | ||
of Directors are Independent |
Board Leadership Structure
Under our Board’s current leadership structure, we have an executive Chair and an independent Lead Director.
| David D. Ossip CEO and Chair |
| Gerald C. Throop Lead Director |
• Mr. Ossip, our CEO, serves as Chair of our Board. • He presides over meetings of our Board and holds such other powers and carries out such other duties as are customarily carried out by the chair of a board of directors. • Our Board believes that the current Board leadership structure, which includes a Lead Director, provides effective independent oversight of management while allowing our Board and management to benefit from Mr. Ossip’s leadership and years of managerial and strategic experience. • We believe Mr. Ossip is best positioned to identify strategic priorities, lead critical discussions, and execute our strategy and business plans, and that he possesses detailed in-depth knowledge of the issues, opportunities, and challenges facing Dayforce. • Our Board believes that Mr. Ossip’s combined role enables strong leadership, creates clear accountability, facilitates information flow between management and our Board, and enhances our ability to communicate our message and strategy clearly and consistently to our stockholders. | • Mr. Throop was elected by the independent directors to serve as our independent Lead Director. • He is empowered with and exercises robust, well-defined duties as set forth in our Corporate Governance Guidelines, a copy of which is available on our website under "Governance Documents" on the Corporate Governance section of our Investor Relations page at www.dayforce.com. • Mr. Throop advises the Chair concerning matters for the Board to consider and information to be provided to the Board, including through the retention of advisors and consultants who report directly to the Board, and collaborates with the Chair concerning meeting agendas and schedules. • He presides at meetings of the Board in the absence of, or upon the request of, the Chair and calls and presides over all executive sessions of independent directors. • He also serves as a liaison and supplemental channel of communication between independent directors and the Chair, and as the principal liaison for consultation and communication between stockholders and independent directors. |
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Oversight Responsibilities
APPROVAL OF CERIDIAN HCM HOLDING INC. GLOBAL EMPLOYEE STOCK PURCHASE PLANOur Board meets at least quarterly, and works closely with management to provide oversight and counsel related to long-term strategy, significant business risks and opportunities, and operational performance. It also engages directly with stockholders to gather feedback, oversees CEO succession planning, and maintains compliance with our robust corporate governance practices.
AtMeetings of the Board of Directors and Stockholders
Our Board held five meetings in Fiscal Year 2023. Each director attended at least 90% of all meetings of the Board and the committees on which they served that were held during Fiscal Year 2023.
All directors are encouraged to attend our annual meeting of stockholders. Our 2023 Annual Meeting was held virtually and nine of the ten directors serving at that time were in attendance.
BOARD MEETINGS |
| COMMITTEE MEETINGS |
| ATTENDANCE |
|
|
|
| Each director attended at least |
5 |
| 26 |
| 90% |
Board meetings in Fiscal Year 2023 |
| Meetings of all Board committees in Fiscal Year 2023 |
| of all meetings of the Board and committees on which they served |
Committees of the Board of Directors
Our Board has established an Acquisition and Finance Committee, Audit Committee, Compensation Committee, and Corporate Governance and Nominating Committee. Each committee operates under a charter that has been approved by our Board and has the composition and responsibilities described below. Members serve on these committees until their resignations or until otherwise determined by our Board. The charter of each committee is available on our website under "Governance Documents" on the Corporate Governance section of our Investor Relations page at www.dayforce.com.
AUDIT COMMITTEE |
Meetings held in 2023: 15 Purpose: The primary purpose of our Audit Committee is to assist the Board’s oversight of, among other things: • Audits of our financial statements; • The quality and integrity of our financial statements and related disclosure; • Our policies and practices with respect to risk assessment and risk management (except with respect to those risks for which oversight is assigned to another Board committee); • The conduct and systems of internal control over financial reporting and disclosure controls and procedures; • The qualifications, engagement, compensation, independence, and performance of our independent auditor; • The performance of our internal audit function; and • The Company’s policies and practices with respect to risk assessment and risk management, in conjunction with the management team. Composition: The Audit Committee is currently composed of Mses. Farrington, Mantia, and Rosen and Mr. Throop. Mr. Throop serves as chair of the Audit Committee, and each of Mses. Farrington, Mantia, and Rosen and Mr. Throop qualify as an “audit committee financial expert” as such term has been defined by the Securities and Exchange Commission ("SEC") in Item 407(d) of Regulation S-K. Our Board has affirmatively determined that each of Mses. Farrington, Mantia, and Rosen and Mr. Throop qualify as audit committee financial experts and meet the definition of an “independent director” for the purposes of serving on the Audit Committee under applicable NYSE rules and Rule 10A-3 under the Securities Exchange Act of 1934, as amended (“Exchange Act”). The Audit Committee is governed by a charter that complies with the rules of the NYSE. |
| 17 | 2024 PROXY STATEMENT |
COMPENSATION COMMITTEE |
Meetings held in 2023: 5 Purpose: The primary purpose of our Compensation Committee is to assist the Board in overseeing our management compensation policies and practices, including, among other things: • Determining and approving the compensation of our executive officers; • Reviewing and approving incentive compensation awards to executive officers; • Making recommendations to the Board with respect to compensation of our directors; • Reviewing and approving selection of peer companies used for compensation analysis; and • Making recommendations to the Board with respect to all equity-based compensation plans. The Compensation Committee may, in its discretion, delegate all or a portion of its duties and responsibilities to a subcommittee of the committee. In particular, the Compensation Committee may delegate the approval of certain decisions relating to equity compensation to a subcommittee consisting solely of members of the Compensation Committee who are “Non-Employee Directors” for the purposes of Rule 16b-3 under the Exchange Act. Composition: Our Compensation Committee is composed of Messrs. Bickett, Clarke, and Hagerty, and Ms. Rosen. Mr. Bickett serves as chair of the Compensation Committee. All members of the Compensation Committee meet the required independence standards under applicable NYSE and SEC rules. The Compensation Committee is governed by a charter that complies with the rules of the NYSE. Compensation Committee Interlocks and Insider Participation No member of our Compensation Committee has ever been one of our executive officers or employees. None of our executive officers currently serves, or in the past year has served, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on our Board or Compensation Committee. |
CORPORATE GOVERNANCE AND NOMINATING COMMITTEE |
Meetings held in 2023: 4 Purpose: The primary purposes of our Corporate Governance and Nominating Committee are to, among other things: • Make recommendations to the Board regarding nomination of individuals as members of the Board and its committees; • Assist the Board with identifying individuals qualified to become Board members; • Take responsibility for management succession planning for non-CEO senior management; • Provide oversight of policies and programs on issues of social responsibility and environmental sustainability; and • Determine corporate governance practices and related matters. Composition: Our Corporate Governance and Nominating Committee is comprised of Mses. Farrington and Mantia and Messrs. Bickett and Rao. Ms. Farrington serves as chair of the Corporate Governance and Nominating Committee. Our Board has affirmatively determined that each of Mses. Farrington and Mantia and Messrs. Bickett and Rao meet the definition of an “independent director” for purposes of serving on the Corporate Governance and Nominating Committee under applicable NYSE rules. The Corporate Governance and Nominating Committee is governed by a charter that complies with the rules of the NYSE. |
ACQUISITION AND FINANCE COMMITTEE |
Meetings held in 2023: 2 Purpose: The primary purpose of our Acquisition and Finance Committee is to assist the Board’s oversight of, among other things, reviewing and providing direction regarding matters involving capital expenditures, investments, acquisitions, dispositions, financing activities, and other related matters. The Acquisition and Finance Committee meets on an as-needed basis to fulfill the responsibilities set out in its charter. Composition: The Acquisition and Finance Committee is composed of Messrs. Bickett, Hagerty, and Rao and Ms. Farrington. Mr. Hagerty serves as chair. |
| 18 | 2024 PROXY STATEMENT |
Board’s Role in Risk Oversight
Our Board works directly with management to review Dayforce’s major areas of risk, assess management’s strategies for adequately managing risk, and determine the levels of risk appropriate for Dayforce.
The committees of the Board support the Board in exercising its risk oversight duties by overseeing the risks within the purview of their respective substantive areas. While the Audit Committee has responsibility to review corporate practices and policies with regard to risk management, the chairs of the Audit Committee, Compensation Committee, and Corporate Governance and Nominating Committee report on any committee-level risk-related discussions to the Board at each regular meeting of the Board, and the Acquisition and Finance Committee reports regularlyto the Board summarizing the committee’s actions and any significant issues considered by the committee. This reporting process enables the Board and its committees to coordinate the risk oversight role, particularly with respect to risk interrelationships.
A breakdown of the type of risks and risk management activities overseen by each committee is provided here:
Audit Committee | Compensation Committee | |
• Design and operation of the Enterprise Risk Management process • Design and operation of the Company's internal controls over financial reporting • Ongoing assessment, monitoring, and mitigation of enterprise risks, with a focus on mission-critical risks including in the areas of cybersecurity, information technology, operational resilience, and privacy • Operation of a risk-based internal audit function | • Compensation policies and practices impacting recruitment and retention of executive talent, including reviewing and approving the annual compensation risk assessment conducted by management | |
Corporate Governance and Nominating Committee | Acquisition and Finance Committee | |
• Corporate governance and related matters, including Board composition and refreshment, succession planning for non-CEO senior management, and ESG related items | • Capital expenditures, investments, acquisitions, dispositions, financing activities, and other related matters not addressed by the entire Board |
Additional information regarding the responsibilities of each committee is available in the “Committees of the Board of Directors” section on page 17 of this Proxy Statement, and in the charters of each of the Board committees.
| 19 | 2024 PROXY STATEMENT |
CORPORATE GOVERNANCE |
Code of Conduct
We have a Code of Conduct that applies to all employees, contractors, officers, and directors of Dayforce, Inc. and its majority-owned subsidiaries and controlled affiliates. A copy of the Code of Conduct is available on our website under "Governance Documents" on the Corporate Governance section of our Investor Relations page at www.dayforce.com. Any amendments to or waivers from our Code of Conduct granted to directors or executive officers will be disclosed on our website.
Corporate Governance Guidelines
Our Board has adopted corporate governance guidelines in accordance with the corporate governance rules of the NYSE and the TSX, which serve as a flexible framework within which our Board and its committees operate. These guidelines cover several areas, including Board composition, roles of the Chair and Lead Director, director nominations and Board membership criteria, Board meetings and executive sessions, Board committees, management succession, Board compensation, expectations of directors, Board performance evaluations, and access to management and outside advisors. A copy of our Corporate Governance Guidelines is posted on our website under "Governance Documents" on the Corporate Governance section of our Investor Relations page at www.dayforce.com.
Director Service on Other Public Company Boards
We value the experience our directors bring from the other boards on which they serve, but also recognize that those boards may present demands on a director’s time and availability and may present conflicts or legal issues. Accordingly, under our Corporate Governance Guidelines, a director is required to receive approval from the chair of the Corporate Governance and Nominating Committee and the Corporate Secretary prior to joining a new board of directors or undertaking other significant commitments involving affiliation with other businesses or governmental agencies. The guidelines state that no director may sit on more than five public company boards (including the Company’s), and no director who is a CEO of a public company may sit on the board of more than two public companies besides the public company for which they are CEO. As of the time of mailing of this Proxy Statement, all directors satisfy the “overboarding” guidelines.
No-Hedging and No-Pledging Policy
Our Insider Trading and Tipping Policy prohibits the hedging or pledging of Dayforce stock by our directors or executive officers unless an exception is granted by the Board. No exceptions to the policy were granted in 2023.
Director Evaluations
Our Board and Board committees conduct annual self-assessments of the effectiveness of the Board, Board committees, and our directors. The evaluation process was developed by and is administered under the direction of the Corporate Governance and Nominating Committee. The assessment is facilitated through a questionnaire process and is designed to elicit feedback with respect to areas such as Board and committee composition, governance, communication, culture, risk, and strategy. Responses are discussed with each of the Board committees and the full Board. Recommendations are discussed with the Board and within the appropriate Board committees, and then considered and implemented as appropriate.
Management Development and Succession Planning
One of the primary responsibilities of the Board is to ensure that Dayforce has a high performing leadership team. To meet that goal, the Board, the Corporate Governance and Nominating Committee, and management share responsibility for management development and succession planning.
The Board is responsible for management succession planning for the CEO. Our Lead Director and each Board committee chair, in consultation with the CEO, periodically discuss CEO succession planning, including the policies and principles for evaluating performance and selecting a successor, and policies regarding succession in the event of an emergency or the retirement of the CEO. The Corporate Governance and Nominating Committee is
| 20 | 2024 PROXY STATEMENT |
responsible for non-CEO succession planning, which includes periodic discussions with our Chief Human Resources Officer and CEO related to succession plans for certain members of Dayforce's senior management team who serve on an internal committee to guide operations of the organization (the "Executive Operating Committee"). The Chief Human Resources Officer and senior human resources leaders work with functional leaders across the Dayforce organization to develop and implement programs to attract, assess, and develop talented individuals for potential future senior leadership positions, including those on the Executive Operating Committee level.
Indemnification of Directors and Officers
Our restated certificate of incorporation provides that we will indemnify our directors and officers to the fullest extent permitted by the Delaware General Corporation Law (“DGCL”).
We have entered into indemnification agreements with each of our directors. These indemnification agreements provide the directors with contractual rights to indemnification and expense advancement and reimbursement to the fullest extent permitted under the DGCL, subject to certain exceptions contained in those agreements.
| 21 | 2024 PROXY STATEMENT |
DIRECTOR COMPENSATION |
Our Board believes that compensation for directors should be competitive, aligned with stockholders, and reflect the highest standards of corporate governance. Our compensation program for directors is reviewed periodically by our Compensation Committee to ensure that the program remains competitive.
Current Director Compensation Program
The current director compensation program for non-employee directors consists of:
The annual cash retainer and annual cash committee chair and Lead Director fees are paid pro-rata quarterly. Directors are given the flexibility to elect to receive any portion of their annual cash retainer or annual cash committee chair and Lead Director fees in the form of RSUs. Annual equity award grants vest pro-rata quarterly over one year following the date of grant. The one-time RSU award granted upon appointment to the Board vests pro-rata annually over a three-year period following the date of grant. In Fiscal Year 2023, directors who were Canadian taxpayers had the ability to defer issuance of the Common Stock underlying their vested RSUs pursuant to the terms of our Dayforce, Inc. 2018 Equity Incentive Plan (the "2018 EIP") and the underlying RSU award agreement.
Our directors may be reimbursed for approved director education courses and out-of-pocket travel expenses incurred in connection with attendance at Board and Board committee meetings and other Board-related activities.
Director Stock Ownership Principles
Stock ownership and stockholder alignment are key principles of our director compensation program and are reinforced from a director’s appointment to the Board until their service concludes. Therefore, we provide for annual elections where directors may receive any portion of their annual cash fees in the form of RSU awards and provide a one-time RSU award upon a non-employee director’s appointment to the Board.
Stock Ownership Guidelines
The Compensation Committee has established Stock Ownership Guidelines to encourage equity ownership by our executive officers and non-employee directors to reinforce the link between their financial interests and those of our stockholders. A person covered by the Stock Ownership Guidelines will have five years from the later of February 27, 2020, or the date the individual becomes a covered person to satisfy the stock ownership requirements.
We set the Stock Ownership Guidelines for our non-employee directors based on a multiple of their annual base cash retainer as of December 31 of each year. Qualifying shares under the Stock Ownership Guidelines consist of:
Under our Stock Ownership Guidelines, each non-employee director is expected to own an amount of our stock equal in value to five times their annual base cash retainer. As of December 31, 2023, each of our non-employee directors complied with the requirements of the Stock Ownership Guidelines.
Discussion of the Stock Ownership Guidelines as they apply to the NEOs is contained in the CD&A on page 39 of this Proxy Statement.
| 22 | 2024 PROXY STATEMENT |
Director Compensation for Fiscal Year 2023
The following table presents the total annual compensation for each person who served as a member of our Board during 2023, other than Mr. Ossip and Leagh E. Turner, former Co-Chief Executive Officer and a former member of the Board, who received no additional compensation for their service as members of our Board during 2023.
Name |
| Fees | Stock Awards |
| Total ($) | |||||||||||
Brent B. Bickett |
|
| $ | 62,500 |
|
|
| $ | 250,000 |
|
|
| $ | 312,500 |
|
|
Ronald F. Clarke |
|
| $ | 50,000 |
|
|
| $ | 250,000 |
|
|
| $ | 300,000 |
|
|
Deborah A. Farrington |
|
| $ | 57,500 |
|
|
| $ | 250,000 |
|
|
| $ | 307,500 |
|
|
Thomas M. Hagerty |
|
| $ | 57,500 |
|
|
| $ | 250,000 |
|
|
| $ | 307,500 |
|
|
Linda P. Mantia |
|
| $ | 50,000 |
|
|
| $ | 250,000 |
|
|
| $ | 300,000 |
|
|
Ganesh B. Rao |
|
| $ | 50,000 |
|
|
| $ | 250,000 |
|
|
| $ | 300,000 |
|
|
Andrea S. Rosen |
|
| $ | 50,000 |
|
|
| $ | 250,000 |
|
|
| $ | 300,000 |
|
|
Gerald C. Throop |
|
| $ | 120,000 |
|
|
| $ | 250,000 |
|
|
| $ | 370,000 |
|
|
In May 2023, Mr. Clarke elected to receive $250,000 of his 2023 annual equity compensation in the form of RSUs, for a total of 4,187 RSUs. He also elected to have $50,000 of his 2023 annual cash compensation paid in the form of cash.
In May 2023, Ms. Farrington elected to receive $250,000 of her 2023 annual equity compensation in the form of RSUs for a total of 4,187 RSUs, and all $50,000 of her annual cash compensation and all $7,500 of her Corporate Governance and Nominating Chair fee in the form of cash.
In May 2023, Mr. Hagerty elected to receive all $300,000 of his 2023 annual cash and equity compensation and his $7,500 Acquisition and Finance Committee Chair fee in the form of RSUs, for a total of 5,150 RSUs.
In May 2023, Ms. Mantia elected to receive all $300,000 of her 2023 annual cash and equity compensation in the form of RSUs, for a total of 5,025 RSUs.
In May 2023, Mr. Rao elected to receive all $300,000 of his 2023 annual cash and equity compensation in the form of RSUs, for a total of 5,025 RSUs.
In May 2023, Ms. Rosen elected to receive $250,000 of her 2023 annual equity compensation in the form of RSUs, for a total of 4,187 RSUs. She also elected to have $50,000 of her 2023 annual cash compensation paid in the form of cash.
In May 2023, Mr. Throop elected to receive $250,000 of his 2023 annual equity compensation in the form of RSUs, for a total of 4,187 RSUs. He also elected to have all $50,000 of his annual cash compensation, $20,000 of his annual Audit Committee Chair fee, and all $50,000 of his Lead Director fee paid in the form of cash.
| 23 | 2024 PROXY STATEMENT |
DoneCEIare
EXECUTIVE COMPENSATION |
Compensation Committee Report
Our Compensation Committee has reviewed and discussed the “CD&A” with Dayforce’s management. Based on this review and discussion, our Compensation Committee recommended to the Board that the CD&A be included in the 2023 Annual Report and this Proxy Statement.
Members of our Compensation Committee
Brent B. Bickett, Chair
Ronald F. Clarke
Thomas M. Hagerty
Andrea S. Rosen
COMPENSATION DISCUSSION & ANALYSIS |
CD&A Table of Contents | |
Executive Summary | |
Executive Compensation Program Goals and Considerations | |
2023 Compensation Elements and Analysis | |
Compensation Governance | |
Executive Compensation Tables | |
Agreements with our NEOs | |
CEO Pay Ratio | |
Pay Versus Performance |
This CD&A focuses on how our NEOs were compensated for Fiscal Year 2023, and how their Fiscal Year 2023 compensation aligned with our pay for performance philosophy.
For Fiscal Year 2023, Dayforce’s NEOs were as follows:
Name and Position | David D. Ossip | Chair and Chief Executive Officer |
Samer Alkharrat(1) | Executive Vice President, Chief Revenue Officer | |
Christopher R. Armstrong | Executive Vice President, Chief Operating Officer | |
Stephen H. Holdridge(2) | President, Customer and Revenue Operations | |
Leagh E. Turner(3) | Former Co-Chief Executive Officer | |
Noémie C. Heuland(4) | Former Executive Vice President, Chief Financial Officer |
(1) Mr. Alkharrat was appointed Executive Vice President, Chief Revenue Officer on June 8, 2023.
(2) Mr. Holdridge was appointed Executive Vice President, Chief Customer Officer on February 23, 2022, and served in that role until he was appointed President, Customer and Revenue Operations on February 7, 2023.
(3) Ms. Turner resigned as Co-Chief Executive Officer and a member of the Board effective as of November 10, 2023, on which date Mr. Ossip became our sole Chief Executive Officer.
(4) Ms. Heuland resigned as Executive Vice President, Chief Financial Officer effective as of December 31, 2023.
| 24 | 2024 PROXY STATEMENT |
Executive Summary
Our Compensation Committee reviews the efficacy of our programs on an annual basis, taking into consideration our compensation philosophy, business performance, stockholder feedback, our peer group, and company-wide objectives. The compensation program for our NEOs in Fiscal Year 2023 was the result of a multi-year effort to align our executive compensation with our core company goals. The Compensation Committee believes that our compensation program was essential in incentivizing our strong performance during the year and in orienting our executive team toward sustainable stockholder value creation.
Fiscal Year 2023 Company Performance
Our executive team continued to drive strong company performance in Fiscal Year 2023. We were pleased with our continued growth against metrics we believe measure the sustainable efficient growth path we are on as a company, which include the following results:
See Appendix A included in this Proxy Statement starting on page 71 for information regarding non-GAAP financial measures, including a reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures.
Competitive Market Impacts on our Talent and Pay Philosophy
The market we operate in is highly competitive and subject to changing technology and shifting client needs. Our competitors include firms that provide both integrated and point solutions for HCM, as well as local providers in each jurisdiction that we operate. We compete with legacy payroll service providers, as well as Cloud-enabled client-server HCM providers. We also face competition from modern HCM providers, whose solutions have been specifically built as single application platforms in the Cloud. In addition, we also compete with large, long-established enterprise application software vendors. As a result, our compensation program is designed to reflect the realities of operating in a competitive and highly variable market and ensuring that we are able to attract and retain critical talent to support our continued growth and success across all aspects of our business.
| 25 | 2024 PROXY STATEMENT |
Leadership Changes
Our Board continuously evaluates our executive team's makeup and performance to ensure it is optimally designed and constructed to maximize long-term stockholder value. Further, as a successful high-growth technology company, we offer broad development and growth opportunities to our executives. The continued evolution of Dayforce's executive structure across our organization reflects our ability to both develop and attract world-class talent in a competitive environment. The Board feels confident in the Company's ability to continue developing exceptional talent internally and attracting highly talented executives from outside the Company.
In 2023 and early 2024, there were several changes to the makeup of the NEO positions:
Promotion of Stephen H. Holdridge to President, Customer and Revenue Operations
In February 2023, Mr. Holdridge was promoted to President, Customer and Revenue Operations of Dayforce. In that capacity, Mr. Holdridge continues to bring together the revenue and customer functions globally into one organization focused on driving revenue growth and a best-in-class customer experience with quantifiable value at every touchpoint.
Appointment of Samer Alkharrat as Executive Vice President, Chief Revenue Officer
In June 2023, we appointed Mr. Alkharrat as Executive Vice President, Chief Revenue Officer. In that capacity, Mr. Alkharrat has responsibility for fostering existing and prospective customer relationships globally in addition to ensuring the efficiency and alignment of revenue-generating operations.
Departure of Leagh E. Turner as Co-Chief Executive Officer
Ms. Turner resigned from her role as Co-Chief Executive Officer, effective as of November 10, 2023. On November 10, 2023, Mr. Ossip became sole Chief Executive Officer of the Company.
Departure of Noémie C. Heuland as Executive Vice President, Chief Financial Officer
Ms. Heuland resigned from her role as Executive Vice President, Chief Financial Officer, effective as of December 31, 2023.
Appointment of Jeremy R. Johnson as Executive Vice President, Chief Financial Officer
We appointed Mr. Johnson as Executive Vice President, Chief Financial Officer, effective as of January 1, 2024. In that capacity, Mr. Johnson is responsible for leading our global finance and investor relations functions.
| 26 | 2024 PROXY STATEMENT |
Stockholder Feedback
Holders of approximately 96.7% of Dayforce’s outstanding stock represented and voting at Dayforce's 2023 Annual Meeting voted in favor of our Say on Pay proposal, an improvement of approximately 27.2% from the results of the 2022 Annual Meeting. We believe that open dialogue with our stockholders and incorporation of their feedback into our executive compensation program helped drive this improvement, and such conversations remain a cornerstone of our program. Specifically, our 2023 compensation program incorporated the following feedback from our stockholders obtained during our 2022 engagement program:
2023 Compensation | |
What We Heard | Board Response |
Desire for relative comparison performance metrics in long-term incentive program. | The Board introduced a relative TSR ("rTSR") component into the 2023 Long-Term Incentive ("LTI") program for NEOs. |
Concern over the use of similar metrics under both the short-term and long-term incentive plans. | The Board implemented a Short-Term Incentive ("STI") program (referred to as the “MIP”) and an LTI plan in 2023 with two out of three performance metrics differentiated. The Board also introduced individual performance goals for certain executive officers based on the execution of key activities of the Company's business. |
Desire to include true long-term performance aspects into annual long-term incentive program. | The Board added an rTSR component that is measured over a three-year performance period with cliff vesting in the 2023 LTI. Additionally, starting in 2023, the Board expanded the financial performance period for the financial performance stock units ("PSU") in our LTI plan. The financial PSUs now have three separate one-year performance periods with targets set at the beginning of each respective calendar year. This change is designed to ensure continued performance throughout the entire performance period of the award. |
In late 2023 and early 2024, Gerald C. Throop, our Lead Director and Chair of our Audit Committee, and Deborah A. Farrington, the Chair of our Corporate Governance and Nominating Committee, together with senior management, continued our robust stockholder engagement program. We heard the following compensation-related comments during those conversations, which we incorporated into our 2024 compensation program:
2024 Compensation | |
What We Heard | Board Response |
Support for continued exclusion of ESG performance metrics from the executive compensation program. | The Board has not included any ESG performance metrics in executive compensation packages. The Board continues to discuss this topic with stockholders. |
Questions about future large equity grants to Mr. Ossip as a possible consequence of the dissolution of the Co-CEO structure. | The Board believes the 2024 LTI grant provided to Mr. Ossip is sufficiently retentive and appropriate based on competitive market data. |
Some desire for multi-year measurement periods with metrics that are resilient under different market conditions. | As a high-growth company, the Board believes the consecutive one-year performance period in the fPSU (as defined below) portion of the LTI combined with the three-year performance period in the mPSU (as defined below) portion of the LTI is the appropriate mix to motivate and reward our NEOs. |
| 27 | 2024 PROXY STATEMENT |
Executive Compensation Program Goals and Considerations
Our executive compensation program is designed to motivate, attract, and retain the best talent who will help the business continue to grow profitably and deliver increased stockholder value. In shaping the compensation program for 2023, the Compensation Committee considered and responded to feedback from our stockholders who have requested continued adjustments in the compensation program through the inclusion of more targeted performance based awards, including the short-term and long-term incentives described below. In addition, the Compensation Committee responded to stockholder requests to differentiate the performance metrics in the short and long-term incentive programs as further described below.
The Compensation Committee believes the short-term incentives rewarded strong 2023 performance and helped to attract and retain a strong core of the executive team, while the long-term performance grants maintain the executive team's focus on building sustainably towards our medium term performance goals of $2.0 billion in total revenue, 80% adjusted Cloud recurring revenue gross margin, and 30% adjusted EBITDA margin by the end of 2025. With the above context in mind, the following section details the key considerations of our Compensation Committee in setting 2023 total direct compensation ("TDC").
Compensation Philosophy and Pay for Performance Alignment
Our executive compensation philosophy is based on creating a strong pay-for-performance connection through our compensation programs and aligning executive performance with our business goals. As a result of this philosophy, our Compensation Committee believes that our executive compensation program should directly reflect our organization’s performance with substantial emphasis on the creation of long-term value for our stockholders. We achieve this by providing a mix of base salary, short-term incentives, and long-term incentives with a variety of time horizons to balance our near-term and long-term strategic goals.
In 2023, 88% of our Co-CEO TDC, and 76% of our other NEO TDC was provided through long-term equity awards. By having a significant percentage of our Co-CEO and other NEOs' 2023 TDC payable in long-term equity, their 2023 TDC was subject to higher risk and longer vesting than cash compensation, further incentivizing our executive officers to focus on value creation that will benefit our stockholders in the long-term. As depicted below, we define TDC as base compensation, STI, and LTI, with the exclusion of any one-time awards as discussed in the "2023 Compensation Elements and Analysis" section on page 30 of this Proxy Statement.
| 28 | 2024 PROXY STATEMENT |
Peer Group
In reviewing compensation for the executive officers, including the NEOs, our Compensation Committee considers several factors, including practices and policies within a relevant market for talent. Our definition of market comparisons includes companies that, like us, are high-growth, cloud-based technology and software companies. Our Compensation Committee, in consultation with its independent compensation consultant Willis Towers Watson ("WTW"), developed a customized peer group by considering market competitive data from both a peer group, as well as a broader framework from survey data sources (Radford Global Compensation Database and WTW). The combination of the customized peer group and the various survey sources provide a holistic summary of market competitive practices that reasonably compare to our size and scale, growth profile, specific industry, and broad labor market where we compete for talent. Due to a range of factors, including the scope of NEO positions, tenure in role, and company-specific concerns, there is an imperfect comparability of NEO positions between companies. As such, market position served as a reference point in setting the 2023 compensation for our NEOs, rather than a formula-driven outcome.
The Compensation Committee used the peer group described below to set NEO compensation through March 2023:
Peer Group Used in Determining TDC October 2022 - March 2023 | ||
Atlassian Corporation Plc | HubSpot, Inc. | Splunk, Inc. |
Avalara, Inc. | Palantir Technologies Inc. | Tyler Technologies, Inc. |
Coupa Software Incorporated | Paycom Software, Inc. | Unity Software Inc. |
Datadog, Inc. | Pegasystems Inc. | Workday, Inc. |
DocuSign, Inc. | ServiceNow, Inc. | Zendesk, Inc. |
Subsequently, in April 2023, with the assistance of WTW, the Compensation Committee reviewed and updated our peer group to reflect our evolving business and to account for acquisitions or privatization of former peer companies.
The Compensation Committee used the updated peer group described below to set NEO compensation beginning in April 2023:
Peer Group Used in Determining TDC April 2023 - Present | ||
Atlassian Corporation Plc | Paychex, Inc.* | Splunk, Inc. |
BILL Holdings, Inc.* | Paylocity Holding Corporation* | Tyler Technologies, Inc. |
Datadog, Inc. | Pegasystems Inc. | Unity Software Inc. |
Five9, Inc.* | PTC, Inc.* | Workday, Inc. |
HubSpot, Inc | RingCentral, Inc.* | Workiva, Inc.* |
Paycom Software, Inc. | Smartsheet, Inc.* |
*New peers not included in the peer group used in determining TDC October 2022 - March 2023.
In collaboration with WTW, our Compensation Committee reviews our peer group annually, to ensure that our executive compensation remains in line with industry practices.
| 29 | 2024 PROXY STATEMENT |
2023 Compensation Elements and Analysis
Dayforce’s executive compensation program contains a mix of different compensation vehicles to motivate retention, reward for Company performance, and drive stockholder value. Significant elements of the 2023 compensation program include:
Element | Key Characteristics | Rationale | Process |
Base Salary | Provides market competitive fixed compensation for performing duties and responsibilities of the position | Attracts and retains exceptional talent capable of performing in a dynamic, high-growth environment | Reviewed annually, considering each individual’s leadership role, scope, complexity, individual performance, and competitive market trends |
Cash Bonus | One-time cash bonus awarded at inception of employment | From time to time, we offer qualified executives a one-time cash bonus to incentivize them to join the Company | Reviewed with the Compensation Committee and our independent compensation consultant to ensure consistency with market and peer practices |
STI – Management Incentive Plan ("MIP") | Variable compensation in the form of 50% cash and 50% PSUs to align compensation with annual financial performance goals/objectives | Motivates an individual to meet and achieve company-wide goals against pre-defined criteria in areas of strategic importance to Dayforce | Reviewed annually, considering each individual’s leadership role, scope, complexity, individual performance, and competitive market trends |
STI – Sales Incentive Plan ("SIP")(1) | Variable compensation in the form of 100% cash to align compensation with annual sales related goals | Motivates executive officer to meet and achieve Company sales goals | Reviewed annually, considering each executive’s leadership role, scope, complexity, individual performance, and competitive market trends |
LTI – Time-based RSU | Full value grants that vest ratably over three years and support our stock ownership guidelines and long-term retention | Aligns the interests of the individual and the stockholders via equity while encouraging retention and the continuity of our strategic plan | Grant award levels based on individual contributions to business outcomes, potential future contributions, historical grant amounts, retention considerations, and market trends |
LTI – Financial Performance-based Restricted Stock Units ("fPSU") | Grants that vest ratably over three years if the achievement of each separate annual financial performance goals are met, and support our stock ownership guidelines and long-term retention | Aligns the interests of the individual and the stockholders via equity while encouraging retention, financial performance, and the continuity of our strategic plan | Grant award levels based on individual contributions to business outcomes, potential future contributions, historical grant amounts, retention considerations, and market trends |
LTI – Market Performance-based Restricted Stock Units ("mPSU") | Grants that cliff vest after three years based off the Company's TSR relative to theTSR of the respective index | Aligns the interests of executive officers and stockholders via equity while encouraging retention, market-performance, and the continuity of our strategic plan | Grant award levels based on individual contributions to business outcomes, potential future contributions, historical grant amounts, retention considerations, and market trends |
(1) Mr. Alkharrat is the only NEO eligible for the SIP.
| 30 | 2024 PROXY STATEMENT |
Base Salary
We provide base salary as a means to deliver a stable amount of fixed cash compensation to our executive officers, including our NEOs, for performance of their day-to-day responsibilities. The base salary of each of our executive officers, including our NEOs, is reviewed annually to determine if an adjustment is warranted or required and may be reviewed intra-year as well – such as in connection with a promotion or material change in job scope.
We did not raise the base salary of any of our NEOs in 2023. Details on the base salary of each NEO is provided in our Summary Compensation Table on page 40 of this Proxy Statement.
Cash Bonus
From time to time, we offer our qualifying executives a one-time signing bonus in varying cash amounts, which is paid out at the same time as the first regular payment of the executive's base salary. These one-time bonuses are generally subject to a clawback provision that, subject to certain exceptions detailed in the relevant employment agreement, permits the Company to recoup the signing bonus if the executive leaves the Company within two years. This one-time bonus is intended to encourage high quality talent to join the Company and encourage their short-term retention. Our Compensation Committee reviews and approves the amount of all one-time signing bonuses in consultation with our independent compensation consultant.
In 2023, we awarded Mr. Alkharrat a $250,000 cash bonus when he joined the Company.
Short-Term Incentives
Our STI programs are performance-based and designed to focus and reward NEOs for performance on key annual measures that drive stockholder value. In 2023, our STI programs consisted of a MIP that each of our NEOs participated in, and a SIP in which Mr. Alkharrat was the only NEO to participate.
Each NEO has an individual STI payout target. Our Compensation Committee considers several factors when setting the individual STI payout targets and establishing the performance components, including each NEO’s role and responsibilities, expected contribution to Dayforce, potential impact of each NEO’s performance on Dayforce’s performance metrics, and competitive market trends.
Details on the STI payout amounts for each NEO are available in the Summary Compensation Table on page 40 of this Proxy Statement.
| 31 | 2024 PROXY STATEMENT |
Management Incentive Plan
The MIP is designed to incentivize senior employee performance against critical performance metrics that drive stockholder value. In 2023, 100% of Messrs. Ossip, Armstrong, and Holdridge and Mses. Turner and Heuland, and 25% of Mr. Alkharrat's STI target was fulfilled by the MIP.
In 2023, the MIP payouts were measured against the delivery of three key organizational performance metrics: Cloud Revenue, Adjusted EBITDA, and sales per employee per month annual contract value ("Sales PEPM ACV"). The 2023 MIP also introduced individual performance goals for certain NEOs designed to focus those NEOs on performance of specific areas of the business deemed critical to driving our long-term growth initiatives.
In order to provide targeted incentives to each NEO, the metrics under the 2023 MIP were weighted differently among the NEOs as follows:
For Messrs. Ossip and Alkharrat and Ms. Turner, equal weighting across Cloud Revenue, Adjusted EBITDA, and Sales PEPM ACV provided for balanced alignment across the overall business.
For Messrs. Armstrong and Holdridge, equal weighting across Cloud Revenue, Adjusted EBITDA, and individual performance goals provided for balanced alignment across the overall business and each NEO's specific functional areas. The heavier weighting of Sales PEPM ACV focused these NEOs on driving Dayforce's global revenue operations.
For Ms. Heuland, equal weighting across the three organizational performance metrics and individual performance goals provided for balanced alignment across the overall business and Ms. Heuland's specific functional area.
In February 2023, the Compensation Committee approved (i) an increase in the individual short-term incentive target of Mr. Holdridge, from 60% to 80% of his base salary, in connection with his promotion to President, Customer and Revenue Operations; and (ii) an increase in the individual STI target of Mr. Armstrong, from 60% to 80% of his base salary, in recognition of his level of responsibility. Both STI target increases were deemed appropriate by our Compensation Committee, based on competitive market data applicable for Fiscal Year 2023.
We continued to include a Sales PEPM ACV metric to our 2023 performance criteria for both our STI and LTI programs, in order to place additional emphasis on sustainable revenue growth.
Program Performance
Our Compensation Committee set aggressive targets for our 2023 MIP, and our performance against those targets varied for each performance metric. Specifically, in 2023 we met our Cloud Revenue goals, we exceeded our Adjusted EBITDA goals, and we fell short of our aggressive Sales PEPM ACV goals. In the interest of maintaining rigor and discipline in our pay-for-performance philosophy, the Compensation Committee did not exercise its discretion to deem the threshold level of Sales PEPM ACV achieved for the MIP. Based on the achievement level against each respective target and differentiated MIP weighting, payouts for NEOs ranged from 68.74% to 88.25%.
| 32 | 2024 PROXY STATEMENT |
The following table shows the payouts earned under the 2023 MIP for our NEOs based on achievement against their targets.
Metric(1) |
| Why it Matters | Threshold | Goal | Maximum Achievement | Metric Achieved | Payout Earned (%) |
| |||||||||||||||
Cloud Revenue |
| Indicator of growth in our SaaS products, solutions, and geographies as well as emerging markets |
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| $1,377.2 M |
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| $1,412.5 M |
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| $1,447.8 M |
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| $1,408.3 M |
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Adjusted EBITDA(2) | Indicator of our profitability, operating efficiencies, and the scalability of our growth |
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| $364.1 M |
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| $383.3 M |
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| $402.5 M |
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| $405.9 M |
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Sales PEPM ACV |
| Motivates alignment behind top-line growth |
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| (3) |
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| (3) |
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| (3) |
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| (3) |
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Individual Performance Goals(4) |
| Focuses NEOs on performance of specific areas of the business deemed critical |
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| (3) |
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| (3) |
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| (3) |
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| (3) |
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Total Payout |
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| 68.74% - 88.25%(5) |
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MIP Achievement and Payout
Following the conclusion of Fiscal Year 2023, the Compensation Committee reviewed the level of achievement of each performance goal against the pre-established targets and certified the following payouts for our NEOs:
| 33 | 2024 PROXY STATEMENT |
2023 Sales Incentive Plan
Mr. Alkharrat was the only NEO to participate in the 2023 SIP, which was designed to focus him on year-over-year growth of Sales PEPM ACV. Mr. Alkharrat’s 2023 SIP provided an opportunity for Mr. Alkharrat to earn a short-term cash incentive for achievement of sales-related goals for the period commencing on July 1, 2023, through December 31, 2023. Under the terms of the SIP, Mr. Alkharrat had the opportunity to receive a payout based on his sales-related goals, with any overachievement based on a set of payout accelerators for incremental achievement above target, and underachievement resulting in below target payouts. There was no earnings cap or incentive ceiling in the 2023 SIP to maximize the incentive to meet and exceed the sales targets. The financial targets pertaining to Mr. Alkharrat’s 2023 SIP are not being disclosed because we believe such disclosure would cause substantial competitive harm without adding to a meaningful understanding of our business. Pursuant to Mr. Alkharrat’s 2023 SIP, he received a payout at 73% of target level.
Long-Term Incentives
Our LTI programs are performance based and designed to ensure retention of our executives. In 2023, the Compensation Committee focused on infusing additional performance elements into the LTI grants made to NEOs, which included:
New elements of the 2023 LTI grants include:
In 2023, the Compensation Committee placed a greater emphasis on at-risk compensation for the NEOs, with approximately 58.4% of LTI based on performance for Mr. Ossip and Ms. Turner, and approximately 56.5% of LTI based on performance for our non-CEO NEOs, up from 50% in 2022 for all NEOs. Our Compensation Committee believed this mix of equity grants struck the right balance between strengthening the performance-based aspects of the LTI, while also remaining attractive and retentive to the executives participating in the LTI program. In 2023, the performance metrics of the PSU component of the LTI grants focused on recurring revenue, recurring gross margin, and sales growth. It is our Compensation Committee’s belief that our executives should be incentivized to drive the metrics that are most important to Dayforce’s continued growth and profitability.
When grant type and quantum decisions were made in February 2023, our Compensation Committee considered the historic development and execution of Dayforce’s strategic growth plan which drove strong financial performance in the prior fiscal periods. Our Compensation Committee also considered the criticality of the current period to Dayforce’s long-term growth and the “war for talent” that was spurring intense competition for leaders in our space.
Mr. Ossip's and Ms. Turner's LTI in 2023 was positioned around the 50th percentile of the peer group, which our Compensation Committee believed appropriately rewarded our Co-CEOs for their unique contributions to our high-performing business and which the Compensation Committee believed to be sufficiently retentive to keep them in
| 34 | 2024 PROXY STATEMENT |
their roles during this critical time of our growth. When our Compensation Committee considered LTI grants for our Co-CEOs, it reviewed the grants of the CEOs of our peer group.
LTIP Achievement and Payout
fPSUs
The following table shows the payouts earned under the fPSU component of the 2023 LTI for our NEOs based on achievement against their targets. Similar to our MIP payout, our Compensation Committee set aggressive targets for the 2023 LTI, and our performance against those targets varied for each performance metric. Specifically, in 2023 we exceeded our Cloud Recurring Revenue and Adjusted Cloud Recurring Gross Margin goals, and we fell short of our aggressive Sales PEPM ACV goals. Our Compensation Committee did not exercise its discretion to deem the threshold level of Sales PEPM ACV achieved for the LTIP.
Metric(1) |
| Why it Matters | Threshold | Goal | Maximum Achievement | Metric Achieved | Payout Earned (%) | |||||||||||||||
Cloud Recurring Revenue |
| Emphasizes growth in recurring revenue generated in our SaaS products, solutions, and geographies as well as emerging markets |
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| $1,164.2 M |
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| $1,194.0 M |
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| $1,223.9 M |
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| $1,206.0 M |
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Adjusted Cloud Recurring Gross Margin(2) | Emphasizes control of business operation costs while continuing to focus on revenue generation |
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| 75.5% |
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| 77.4% |
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| 79.3% |
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| 78.3% |
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Sales PEPM ACV |
| Motivates alignment behind top-line growth |
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| (3) |
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| (3) |
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| (3) |
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| (3) |
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Total Payout |
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| 81.26% | ||||
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Our Compensation Committee certified the results of 81.26% total payout earned in 2023 under the fPSU metrics. Details on the payout amounts for each NEO is available in the Summary Compensation Table on page 40 of this Proxy Statement.
mPSUs
The mPSU component of the 2023 LTI for our NEOs was first introduced in 2023. The metrics used to determine vesting of the mPSUs are based on TSR performance relative to the S&P 1500 Application Software Index for the three-year performance period from January 1, 2023, through December 31, 2025. The Compensation Committee
| 35 | 2024 PROXY STATEMENT |
selected the comparison group of the S&P 1500 Application Software Index for its stability and because it consists of companies closest to our industry with a certain caliber of performance required to remain in the index.
The mPSUs fully vest on the third anniversary of the grant date, contingent upon achievement of the mPSU goal. The mPSU has a potential threshold payout of 50% for achieving the 25th percentile rTSR; a target payout of 100% for achieving the 50th percentile rTSR; an above target payout of 150% for achieving the 75th percentile rTSR; and a maximum payout of 200% for achieving the 90th percentile of the TSR peer group. Actual achievement will be askedcertified by the Compensation Committee or the Board in 2026 after completion of the three-year performance period.
One-Time PSU
A one-time PSU (the "Holdridge PSU") was granted to considerMr. Holdridge in connection with his promotion to President, Customer and act uponRevenue Operations in February 2023. The award was based on the Company's achievement of Sales PEPM ACV in 2023, with potential payouts between 50% and 200% of target for threshold to maximum levels of achievement. Upon the Compensation Committee or the Board certifying that the Company had achieved at least the threshold level, one-third of the PSUs would vest annually on each of the first three anniversaries of the grant date.
We are not disclosing the target, threshold, or maximum level of payout for his performance criteria, as we believe such disclosure would cause substantial competitive harm without adding to a proposalmeaningful understanding of our business. We do not provide guidance on this metric throughout the year. Similar to approveour MIP and fPSU payout, our Compensation Committee set an aggressive target for the Ceridian HCM HoldingHoldridge PSU. The Holdridge PSU achieved less than the threshold level of performance, which resulted in an achievement of 0% and zero PSUs vesting.
Other Elements
We offer healthcare, insurance, retirement benefits, and paid time off for every employee at Dayforce, including our NEOs, to invest in our employees’ health and future. Benefits are substantially the same for all employees, including NEOs, based on country location. In addition, we offer select perquisites to some of our executives, including Mr. Ossip and Ms. Turner in 2023.
Additional information on the employee benefits and other compensation provided to our NEOs is available in the Summary Compensation Table on page 40 of this Proxy Statement.
Global Employee Stock Purchase Plan
The Dayforce, Inc. Global Employee Stock Purchase Plan (the “GESPP”("GESPP"). The provides an opportunity for eligible employees to become Dayforce stockholders and drives employee engagement. This plan provides a 15% discount on the stock purchase price with a lookback feature. All employees in the U.S., Canada, UK, Germany, Mauritius, Australia, and New Zealand were eligible for participation in the GESPP was approved unanimously and adoptedas of December 31, 2023, including our NEOs, unless otherwise prohibited by the rules of the Internal Revenue Service.
Executive Severance
Within the employment agreements of the NEOs, we provide for severance payments and benefits in the event of a qualifying termination of employment, which may include varying severance payments based on the length of service to Dayforce. The Compensation Committee believes that these arrangements are competitively reasonable and necessary to recruit and retain key executives. The material terms of these severance payments to our NEOs are described in “Potential Payments upon Termination or Change in Control” on page 47 of this Proxy Statement.
| 36 | 2024 PROXY STATEMENT |
Compensation Governance
What we do | What we do not do | |
✓ Pay for performance – A significant percentage of the 2023 TDC featured performance-based metrics, including 56% of our annual LTI. ✓ Independent compensation consultant – The Compensation Committee retains an independent compensation consultant to advise on our executive compensation program and practices. ✓ Robust Stock Ownership Guidelines – We have Stock Ownership Guidelines for executive officers of 6x annual base salary for our CEO and 3x annual base salary for our other executive officers. ✓ Annual compensation risk assessment – A risk assessment of our compensation programs is performed on an annual basis to ensure that our compensation programs and policies do not incentivize excessive risk-taking behavior. ✓ Peer group analysis – The Compensation Committee reviews external market data when making compensation decisions and annually reviews our peer group with its independent compensation consultant. ✓ Independent Compensation Committee – Our Compensation Committee is 100% comprised of independent members of our Board. ✓ Clawback policy – In the event that the Board determines that a material accounting restatement of our financial statements has occurred, Dayforce may recoup all or a portion of the excess incentive compensation received by our executive officers in the three completed fiscal years immediately preceding the date of the material accounting restatement pursuant to our Compensation Recovery Policy. Our Compensation Recovery Policy is compliant with NYSE rules, and has been publicly filed as an exhibit to our Annual Report on Form 10-K. ✓ Annual stockholder “Say on Pay” vote – We value our stockholders’ input on our executive compensation programs. Our Board seeks an annual non-binding advisory vote from stockholders to approve the executive compensation disclosed in our CD&A, tabular disclosures, and related narrative of the proxy statement. ✓ Stockholder engagement –We routinely engage with our stockholders to seek their input on our compensation policies and practices. In addition, the 2018 EIP contains a recovery provision whereby Dayforce may recoup (i) gain on awards granted under the 2018 EIP in the event of a termination for cause; and (ii) excess on awards granted under the 2018 EIP in the event of an accounting restatement. | X | No change in control single trigger acceleration – We grant equity awards that require both a change in control and an involuntary termination without cause or voluntary termination with good reason before vesting. |
X | No hedging of company stock – Executive officers and members of the Board may not directly or indirectly engage in transactions intended to hedge or offset the market value of Dayforce’s Common Stock owned by them. Please see discussion of Dayforce’s anti-hedging policy described on page 20 of the Proxy Statement. | |
X | No pledging of company stock – Executive officers and members of the Board may not directly or indirectly pledge Dayforce’s Common Stock as collateral for any obligation. Please see discussion of Dayforce’s anti-pledging policy described on page 20 of the Proxy Statement. | |
X | No repricing or exchange of underwater stock options – Our equity incentive plan does not permit repricing or exchange of underwater stock options without stockholder approval. | |
X | No tax gross-ups – We do not provide tax gross-ups to our executive officers. | |
X | No excessive perquisites – We do not provide excessive perquisites for executive officers. | |
X | No guaranteed bonuses –We do not provide guaranteed annual bonus payouts. |
| 37 | 2024 PROXY STATEMENT |
Compensation Committee Oversight
The Compensation Committee, comprised entirely of independent directors, reviews and approves the compensation of Dayforce’s NEOs and other executive and senior officers. The Compensation Committee also administers and makes recommendations related to equity-based compensation plans to the Board. Details of the Compensation Committee’s duties are summarized in the Board of Directors overview of this Proxy Statement (beginning on page 16) and are fully set out in the Compensation Committee’s charter which can be found on our website under “Governance Documents” on the Corporate Governance section of our Investor Relations page at www.dayforce.com.
Use of an Independent Compensation Consultant
As permitted under its meetingcharter, in 2023, the Compensation Committee retained WTW as its independent compensation consultant. WTW reports directly to the Compensation Committee and takes direction from the Chair of the Compensation Committee. The Compensation Committee assessed the independence of WTW in light of SEC rules and NYSE listing standards and concluded that WTW is independent and its work in 2023 did not raise any conflicts of interest.
During the year, WTW assisted in designing and reviewing our management and director compensation programs, including developing compensation market comparisons, providing competitive program and policies information, attending Compensation Committee meetings, and providing general advice. The Compensation Committee considers the analysis and advice from WTW as well as support and insight from management when making compensation-related decisions.
In 2023, WTW was compensated approximately $445,821 for services to the Compensation Committee. WTW also provides certain other services to Dayforce, including health and welfare benefits consulting and corporate risk and brokerage services. WTW received approximately $1,316,141 for these additional services in 2023. The Compensation Committee is aware of the other services provided by WTW to Dayforce but did not review or approve the provision of these services because they are of the type directly procured by management in the ordinary course of business.
Role of Management
Compensation Committee meetings are typically attended by the CEO, the Executive Vice President, Chief Human Resources Officer, the Senior Vice President, Global Total Rewards, and the Executive Vice President, General Counsel and Corporate Secretary. Our CEO typically provides recommendations on November 9, 2018, atcompensation for all other executive officer roles. Neither of the then-serving Co-CEOs were present when our Compensation Committee discussed the compensation of either Co-CEO in 2023.
Managing Compensation-Related Risk
In connection with their oversight of compensation-related risks, our Compensation Committee and WTW, as our Compensation Committee’s independent compensation consultant, reviewed Dayforce’s compensation policies and practices to ensure that compensation programs do not encourage risk-taking that is reasonably likely to have a material adverse effect on us. Our Compensation Committee and WTW reviewed all compensation plans and identified those plans that are most likely to pose material risks and balanced these against our existing processes and compensation program safeguards. The review process considered mitigating features contained within our compensation plan design, which time it became effective, subjectincludes elements such as mix of pay, timing of payouts relative to approval byperformance periods and metrics, and goal diversification. We believe, and the results of the risk analysis concluded, that our stockholders. We commenced the first offering period under the GESPPcompensation programs do not encourage risk-taking that is reasonably likely to result in a material adverse effect on January 1, 2019, with the actual purchase ofDayforce.
| 38 | 2024 PROXY STATEMENT |
Stock Ownership Guidelines
Our CEO is required to own and hold shares of our Commonstock with a value that is at least equal to six-times his annual base salary. Our other executive officers are required to own and hold shares of our stock with a value that is at least three-times each of their annual base salaries.
Each of our executive officers has five years following the later of their commencement of service with Dayforce as an executive officer subject to the Stock Ownership Guidelines (which includes the date of promotion to a position subject to the Stock Ownership Guidelines or to a new multiple level within the Stock Ownership Guidelines) or the adoption of Stock Ownership Guidelines to satisfy the stock ownership requirement. If an executive officer does not achieve the Stock Ownership Guidelines requirements as of December 31 of the year following the fifth anniversary of being subject to the Stock Ownership Guidelines, then the executive officer must retain at least 75% of after-tax shares received in connection with equity awards until the Stock Ownership Guidelines requirements are met.
Qualifying shares under the GESPP contingent upon approval by our stockholders.
If this proposal is approved by the holders of a majority of the votes represented by our Voting Stock and voting on the matter, the maximum aggregate number ofOwnership Guidelines consist of: (i) shares of Common Stock that may be issued underor Exchangeable Shares held directly or beneficially owned by the GESPP will be 2,500,000, which will be used to satisfy the purchase ofexecutive officer, including any shares of Common Stock under either the Code Section 423 Componentheld in a brokerage account or theNon-Code Section 423 Component of the GESPP. We do not maintain any other employee stock purchase plans. However, we do maintain the Ceridian HCM Holding Inc. 2018 Equity Incentive Plan, which allows us to grant various forms of equity compensation awards to our employees, officers andnon-employee directors and to those of our subsidiaries.
If this proposal is approved by our stockholders as described above, the first offering period will conclude and the first purchase of401(k) account; (ii) shares of Common Stock underor Exchangeable Shares held indirectly by the GESPP will occur on June 28, 2019. In the event that our stockholders as described above do not approve this proposal, all contributions made under the GESPP for the applicable offering period will be refunded to participants, without interest, as soon as reasonably practicable and noexecutive officer if such shares of Common Stock will be issued under the GESPP.
The following description of the GESPP is a summary and is qualified in its entirety by reference to the plan document for the GESPP, a copy of which is attached asAnnex A to this Proxy Statement.
Purpose
The purpose of the GESPP is to provide an incentive to eligible employees by giving them an opportunity to become owners of Ceridian and play a role in our future.
Plan Administration
The GESPP will be administeredor Exchangeable Shares are “beneficially owned” by the compensation committee of the Board. The compensation committee will have broad administrative authority over the GESPP. All questions regarding (a) the interpretation of the GESPP, any form of agreement or other document employed by us in the administration of the GESPP, (b) any purchase rights granted under the GESPP, and (c) the correction of any errors arising under the GESPP will be determined by the compensation committee andexecutive officer, including such determinations will be final and binding upon all persons having an interest in the GESPP or the purchase rights. The compensation committee also will determine all relevant terms and conditions of the purchase rights granted to employees, provided that all employees have the same rights and privileges within the meaning of Section 423(b) of the United States Internal Revenue Code of 1986, as amended, and any applicable regulations promulgated thereunder (the “Code”), for purposes of the Code Section 423 Component of the GESPP. Any of the compensation committee’s administrative tasks may be assigned to an individual designated by us to receive enrollment agreements, withdrawal notices and other communications from eligible employees (the “Administrator”).
Available Shares
Subject to adjustment for certain changes in recapitalization or reorganization, in which we are a party, the maximum aggregate number of shares of Common Stock that may be issued underor Exchangeable Shares held by an affiliated entity, a spouse and/or immediate family member of the GESPP will be
2,500,000 shares of Common Stock. For the sake of clarity, the aggregate share limitation may be used to satisfy the purchase ofexecutive officer, or shares of Common Stock under eitheror Exchangeable Shares held in trust for the Code Section 423 Component or theNon-Code Section 423 Componentbenefit of the GESPP. Sharesexecutive officer; and (iii) vested RSUs held directly by the executive and granted to the executive officer under a Dayforce equity plan.
As of CommonDecember 31, 2023, each of our NEOs met or are complying with the retention requirements in accordance with the Stock that may be issuedOwnership Guidelines.
Compensation Recovery Policy
In April 2023, we amended our Compensation Recovery Policy in compliance with Rule 10D-1 under the GESPP may consist of authorized but unissued shares and/or reacquired shares (treasury shares). If any rights to purchase shares of Common Stock granted under the GESPP expire or are terminated or canceled, the shares of Common Stock allocableExchange Act and NYSE listing rules. Pursuant to the unexercised portion of such rights will again be available for issuance under the GESPP.
Offerings
The GESPP will be implemented by offering all eligible employees an option to purchase shares of Common Stock, which the employee may or may not exercise during an offering period (“Purchase Right”). The duration of each offering period will be the calendar year commencing on January 1 and concluding on December 31 of each year (each, an “Offering Period”). Each Offering Period will consist of four quarterly purchase periods (each, a “Purchase Period”) commencing on January 1, April 1, July 1 and October 1; provided, the initial Purchase Period under the GESPP will run from January 1, 2019 to June 30, 2019.
Eligibility
Our employees (or those employees of our subsidiaries that are designated for offering participation in either the Code Section 423 Component orNon-Code Section 423 Component of the GESPP) may participate in offerings under the GESPP provided they were employed prior to the start of an enrollment period for an applicable Purchase Period (“Eligible Employee”).
No employee will be eligible to participate in the GESPP if, immediately after the grant of Purchase Rights, the employee would own, directly or indirectly, stock possessing 5% or more of the total combined voting power or value of all classes of our stock, a future parent corporation, or our subsidiary companies, including any stock that such employee may purchase under all outstanding Purchase Rights and other equity compensation awards. In addition, no employee may purchase more than $25,000 worth of shares of Common Stock (determined based on the fair market value of the shares at the time such Purchase Right is granted) under the GESPP and anyNon-Code Section 423 Componentsub-plans of our subsidiary companies for each calendar year during which such Purchase Right is outstanding.
As of the date of this proposal, approximately 4,498 employees in the United States and other countries will be eligible to participate in the GESPP if approved by our stockholders as described above.
Participation
An Eligible Employee who elects to participate in the GESPP (“Participant”) must enroll in the GESPP by timely submitting a properly completed enrollment agreement to the Administrator during the enrollment period that precedes each Purchase Period, authorizing payroll deductions in whole percentages from 1% to 10% of his or her compensation to be deducted from each pay period during the Offering Period. The compensation committee may, in its sole discretion, permit additional lump sum contributions on a periodic basis during the Offering Period in a form and manner as determined by the compensation committee; provided, the amount of any additional lump sum contributions made by a Participant, when combined with other Participant contributions, shall not exceed the maximum amount allowed under the terms of the GESPP.
Payment of Purchase Price; Payroll Deductions
The purchase of shares during each Offering Period will be funded by a Participant’s payroll deductions accumulated during the Offering Period. Participant payroll deductions will commence on the first pay day following the first day of the Offering Period and will continue to be deducted each pay day through the end of the Offering Period. Interest will not be paid on Participant accumulated payroll deductions, which will be
deposited with our general funds and may be used by us for any corporate purpose. A Participant may not increase, but may decrease the rate of payroll deductions once during an Offering Period by timely submitting an amended enrollment agreement to the Administrator. A Participant who elects to decrease the rate of his or her payroll deductions to 0% will remain in the GESPP unless he or she elects to withdraw from the GESPP. Unless a Participant’s participation is withdrawn, his or her Purchase Right will be exercised automatically on each Purchase Date.
Purchase Price
The price at which a share of Common Stock will be purchased on the last trading day of each Purchase Period (the “Purchase Date”) will be the lower of (i) 85% of the fair market value of a share of Common Stock on the first trading day of the Offering Period, or (ii) 85% of the fair market value of a share of Common Stock on the Purchase Date (the “Purchase Price”).
Purchase Limits
Each Participant will be granted a Purchase Right to purchase on the Purchase Date for such Offering Period up to a maximum number of shares of Common Stock determined by dividing such Participant’s contributions accumulated prior to such Purchase Date by the applicable Purchase Price; provided, however, that in no event will a Participant be permitted to purchase more than $25,000 worth of shares of Common Stock (determined based on the fair market value of the shares at the time such Purchase Right is granted) under the GESPP and anyNon-Code Section 423 Componentsub-plans of our subsidiary companies for each calendar year during which such Purchase Right is outstanding.
Termination of Employment
In the event a Participant’s employment is terminated, prior to a Purchase Date, for any reason, including retirement, disability or death, orCompensation Recovery Policy, in the event hethat the Board determines that a material accounting restatement of our financial statements has occurred, Dayforce may recoup all or she is no longer eligible to participatea portion of the excess incentive compensation received by our executive officers in the GESPP, his or her rights under any offering under the GESPP will terminate immediately. Contributions credited to the Participant’s account since the last Purchase Date will be, as soon as practicable, returned to the Participant, or, in the case of the Participant’s death, to the Participant’s legal representative.
Voluntary Withdrawal
Participants may withdraw from the GESPP at any time and receive a refund of all payroll deductions, without interest, credited to his or her GESPP account that have not been applied toward the purchase of shares of Common Stock by submitting a withdrawal election to the Administrator no later than the 15th day of the month in which the applicable Purchase Date falls. The payroll deductions will be returned as soon as practicable after the withdrawal and may not be applied to the purchase of shares of Common Stock in any other offering under the GESPP. Participants who withdraw from the GESPP will be prohibited from resuming participation for the same Offering Period, but may participate in any subsequent Offering Period.
Restrictions on Transferability
Payroll deductions credited to a Participant’s account and any Purchase Rights granted under the GESPP may not be assigned, alienated, pledged, attached, sold or otherwise disposed of in any way (other than by will, the laws of descent and distribution) by the Participant. Any attempt at assignment, transfer, pledge or other disposition will be without effect, except that we may treat such act as an election to withdraw from the GESPP.
Effect of Recapitalization and Reorganization
In the event of certain changes in our capitalization, the compensation committee will appropriately adjust the number and class of shares of Common Stock subject to the GESPP and each Purchase Right and/or the Purchase Price. The compensation committee also has discretion to make equitable adjustments to the GESPP in the event of other changes in our capital structure or business to prevent the substantial dilution or enlargement of rights granted to, or available for, Participants under the GESPP.
Effect of Change in Control
In the event of a change in control, as defined by the GESPP, any surviving or acquiring corporation may assume our rights and obligations under the GESPP. If the surviving or acquiring corporation does not assume our rights and obligations under outstanding Purchase Rights, the Purchase Date of the then current Offering Period will be accelerated to a date beforethree completed fiscal years immediately preceding the date of the change in control, but the number of shares of Common Stock subjectmaterial accounting restatement. Our Compensation Recovery Policy has been publicly filed as an exhibit to outstanding Purchase Rights will not be adjusted. All Purchase Rights that are neither assumed nor exercised as of the date of the change in control will terminate and cease to be outstanding effective as of the date of the change in control.
Amendment and Termination
The Board or the compensation committee may amend the GESPP at any time; provided that any outstanding Purchase Right granted before an amendment of the GESPP is not materially adversely affected by any such amendment, except as necessary to comply with applicable laws, listing requirements or governmental regulations (including Section 423 of the Code), or as necessary to obtain or maintain favorable tax, listing or regulatory treatment. An amendment must be approved by our stockholders as described above within 12 months of the adoption of such amendment if the amendment authorizes the sale of more shares of Common Stock than are authorized for issuance under the GESPP or changes the definition of the corporations or companies that may be designated by the compensation committee as participating in the GESPP.
Certain U.S. Federal Income Tax Consequences
The following is a summary of the principal United States federal income tax consequences to Participants in the United States and to us with respect to participation in the Code Section 423 Component of the GESPP. The rules concerning the federal income tax consequences with respect to participation in the GESPP are quite technical. Moreover, the applicable statutory provisions are subject to change, as are their interpretations and applications which may vary in individual circumstances. Therefore, the following is designed to provide a general understanding of the federal income tax consequences. In addition, the following discussion does not set forth any gift, estate, social security or state or local tax consequences that may be applicable, and such discussion is limited to the U.S. federal income tax consequences to individuals who are citizens or residents of the United States, other than those individuals who are taxed on a residence basis in a foreign country. Because the tax consequences to any Participant may depend on his or her particular situation, each Participant should consult his or her own tax adviser regarding the federal, state, local, and other tax consequences of the grant or exercise of a Purchase Right or the sale or other disposition of shares of Common Stock acquired under the GESPP. The GESPP is not subject to any of the requirements of the Employee Retirement Income Security Act of 1974, as amended. The GESPP is not, nor is it intended to be, qualified under Section 401(a) of the Code.
Rights granted under the GESPP are intended to qualify for favorable federal income tax treatment associated with rights granted under an employee stock purchase plan which qualifies under the provisions of Section 423 of the Code.
A Participant will be taxed on amounts withheld for the purchase of shares of Common Stock, but will not recognize taxable income as a result of the granting or exercise of a Purchase Right until a sale or other
disposition of the acquired shares. The taxation upon such sale or other disposition will depend upon the holding period of the acquired shares.
If the shares are sold or otherwise disposed of more than two years after the beginning of the Offering Period and more than one year after the shares are transferred to the Participant, then the lesser of the following will be treated as ordinary income: (i) the excess of the fair market value of the shares at the time of such sale or other disposition over the Purchase Price, or (ii) the excess of the fair market value of the shares as of the beginning of the Offering Period over the Purchase Price (determined as of the beginning of the Offering Period). Any further gain or any loss will be taxed as a long-term capital gain or loss.
If the shares are sold or otherwise disposed of before the expiration of either of the holding periods described above, then the excess of the fair market value of the shares on the Purchase Date over the Purchase Price will be treated as ordinary income at the time of such sale or other disposition. The balance of any gain will be treated as capital gain. Even if the shares are later sold or otherwise disposed of for less than their fair market value on the purchase date, the same amount of ordinary income is attributed to the Participant, and a capital loss is recognized equal to the difference between the sales price and the fair market value of the shares on such purchase date. Any capital gain or loss will be short-term or long-term, depending on how long the shares have been held.
There are no federal income tax consequences to us by reason of the grant or exercise of rights under the GESPP. We will be entitled to a deduction to the extent amounts are taxed and reported as ordinary income to a Participant for shares sold or otherwise disposed of before the expiration of the holding periods described above (subject to the requirement of reasonableness and the satisfaction of tax reporting obligations).
New Plan Benefits
Participation in the GESPP is voluntary and each eligible employee will make his or her own decision regarding whether and to what extent to participate in the GESPP. In addition, the Board and the compensation committee have not granted any Purchase Rights under the GESPP that are subject to stockholder approval of this proposal. Accordingly, the benefits or amounts that will be received by or allocated to our executive officers and other employees under the GESPP, as well as the benefits or amounts that would have been received by or allocated to our executive officers and other employees for fiscal year 2018 if the GESPP had been in effect, are not determinable. Ournon-employee directors will be ineligible to participate in the GESPP.
“FOR” votes from the holders of a majority of the votes represented by our Voting Stock present at the Annual Meeting or represented by proxy and voting on the matter are required in order to approve Proposal Two.
Recommendation of the Board
THE BOARD RECOMMENDS THAT YOU VOTE “FOR” THE APPROVAL OF THE CERIDIAN HCM HOLDING INC. GLOBAL EMPLOYEE STOCK PURCHASE PLAN.
RATIFICATION OF THE APPOINTMENT OF
OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Our audit committee has appointed KPMG LLP as our independent registered public accounting firm to perform the audit of our consolidated financial statements for the fiscal year ending December 31, 2019, and we are asking our stockholders to ratify this appointment.
The audit committee annually reviews the independent registered public accounting firm’s independence, including reviewing all relationships between the independent registered public accounting firm and us and any disclosed relationships or services that may impact the objectivity and independence of the independent registered public accounting firm, and the independent registered public accounting firm’s performance. As a matter of sound corporate governance, the Board determined to submit to stockholders for ratification the appointment of KPMG LLP.
“FOR” votes from the holders of a majority of the votes represented by the Voting Stock present at the Annual Meeting (in person or represented by proxy) and voting on the matter are required in order to ratify the appointment of KPMG LLP. In the event that this appointment is not ratified, we will review our future appointment of KPMG LLP.
We expect that a representative of KPMG LLP will attend the Annual Meeting, and the representative will have an opportunity to make a statement if he or she so chooses. The representative will also be available to respond to appropriate questions from stockholders.
Policy on Audit CommitteePre-Approval of Audit and PermissibleNon-Audit Services of Independent Registered Public Accounting Firm
We have adopted a policy under which the audit committee mustpre-approve all audit and permissiblenon-audit services to be provided by the independent registered public accounting firm. As part of its review, the audit committee also considers whether the categories ofpre-approved services are consistent with the rules on independence. The audit committeepre-approved all services performed by KPMG LLP in fiscal year 2018.
Audit Fees
The following table sets forth the fees billed or expected to be billed by KPMG LLP for audit, audit-related, tax and all other services rendered for fiscal years 2018 and 2017 (in thousands):
Fee Category | 2018 | 2017 | ||||||
(In thousands) | ||||||||
Audit Fees | $ | 1,995 | $ | 1,075 | ||||
Audit-Related Fees | 1,077 | 884 | ||||||
Tax Fees | 130 | 180 | ||||||
All Other Fees | 0 | 0 | ||||||
|
|
|
| |||||
Total Fees | $ | 3,202 | $ | 2,139 | ||||
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Audit Fees. Consist of fees for services rendered for the audit and/or review of our consolidated financial statements. Audit fees also include fees for services rendered in connection with the filing of registration statements and other documents with the SEC, and the issuance of accountant consents and comfort letters.
Audit-Related Fees. Consist of aggregate fees for accounting consultations and other services that were reasonably related to the performance of audits or reviews of our consolidated financial statements and were not reported above under “Audit Fees.”
Tax Fees. Consist of aggregate fees for tax compliance, tax advice and tax planning services, including the review and preparation of certain foreign income tax returns.
All Other Fees. Consist of fees billed in the indicated year for other permissible work performed by KPMG LLP that is not included within the above category descriptions.
Recommendation of the Board
THE BOARD RECOMMENDS THAT YOU VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF KPMG LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING DECEMBER 31, 2019.
Report of the Audit Committee of the Board of Directors
The audit committee’s general role is to assist the Board in monitoring our financial reporting process and related matters. Its specific responsibilities are set forth in its charter.
The audit committee has reviewed our consolidated financial statements for fiscal year 2018 and met with management, as well as with representatives of KPMG LLP, our independent registered public accounting firm, to discuss the consolidated financial statements. The audit committee also discussed with members of KPMG LLP the matters required to be discussed by Auditing Standard No. 16, “Communications with Audit Committees,” as adopted by the PCAOB.
In addition, the audit committee received the written disclosures and the letter from KPMG LLP required by applicable requirements of the PCAOB regarding the independent accountant’s communications with the audit committee concerning independence and discussed with members of KPMG LLP its independence.
Based on these discussions, the financial statement review and other matters it deemed relevant, the audit committee recommended to the Board that Ceridian’s audited consolidated financial statements for fiscal year 2018 be included in its Annual Report on Form 10-K.
On November 13, 2023, we filed amendments to our Annual Report on Form 10-K for the fiscal year ended December 31, 2018.
Audit Committee
Ganesh B. Rao
Andrea S. Rosen
Gerald C. Throop (Chair)
EXECUTIVE AND DIRECTOR COMPENSATION
Overview
2022, and our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2023, and June 30, 2023 (the "Amended Filings"), in relation to disclosure related to material weaknesses in our internal control over financial reporting. The discussion below includes a reviewAmended Filings did not include any restatement of our previously issued financial results for those periods, but resulted from the discovery of the incorrect presentation of one Canadian bank account balance within “customer funds” and “customer funds obligations” and related items on our condensed consolidated balance sheets and in our net cash provided by financing activities within our condensed consolidated statements of cash flows for the affected periods. There was an understatement of customer funds within current assets and a corresponding understatement of customer funds obligations within current liabilities on our condensed consolidated balance sheets. As a result, we also erroneously presented certain changes related to customer funds and customer funds obligations on our condensed consolidated statements of cash flows. As we concluded that there was no material misstatement of our previously issued financial statements, the previously incorrect presentation was corrected in the presentation of our financial statements included in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2023 (the "Restatement"). Upon the Restatement and in accordance with our Compensation Recovery Policy, the Board reviewed the Restatement and whether any erroneously awarded compensation decisions with respectwas received by a covered officer during the applicable recovery period. After review, the Board determined that the Restatement would not result in the recoupment of any compensation under our Compensation Recovery Policy, because the Restatement did not affect any incentive compensation approved, awarded, or granted to 2018 for our “named executive officers,” or “NEOs”, namely our principal executive officer and our two other most highly compensated executive officers. Our NEOs for 2018 were:
| 39 | 2024 PROXY STATEMENT |
David D. Ossip, our Chief Executive Officer;
Paul D. Elliott, our Chief Operating Officer; and
Leagh E. Turner, our President.
In 2018, we compensated our NEOs through a combination of base salary and annual cash bonuses as well as grants of stock options and restricted stock units under the terms of our Ceridian HCM Holding Inc. 2018 Equity Incentive Plan (“2018 Plan”). Our executive officers are also eligible to receive certain benefits, which include defined contribution retirement plan contributions, life insurance and group health insurance (including medical, dental, long-term disability and critical illness), parking, executive physical, and recreational club dues.Summary Compensation Table
Summary Compensation Table
The following table sets forth certain information for fiscal years 2018Fiscal Years 2023, 2022, and 20172021 concerning the total compensation awarded to, earned by, or paid to our NEOs.
Name and Principal Position | Year | Salary (1)(2) | Bonus (1)(2) | Stock Awards (3) | Option Awards (3) | Nonequity Incentive Plan Compensation (1)(4) | All Other Compensation (2)(5) | Total (2) | ||||||||||||||||||||||||
David D. Ossip | 2018 | $ | 700,000 | $ | 480,000 | $ | — | $ | 10,109,113 | $ | 320,000 | $ | 44,358 | $ | 11,653,471 | |||||||||||||||||
Chief Executive Officer | 2017 | $ | 517,063 | $ | 700,000 | $ | 8,600,000 | $ | 7,875,000 | $ | — | $ | 39,741 | $ | 17,731,804 | |||||||||||||||||
Paul D. Elliott | 2018 | $ | 348,317 | $ | 317,192 | $ | — | $ | 3,639,289 | $ | 111,462 | $ | 38,083 | $ | 4,454,343 | |||||||||||||||||
Chief Operating Officer | 2017 | $ | 367,910 | $ | 527,854 | $ | — | $ | — | $ | — | $ | 34,120 | $ | 929,884 | |||||||||||||||||
Leagh E. Turner | 2018 | $ | 213,715 | $ | 593,000 | $ | 1,931,500 | $ | 1,302,000 | $ | — | $ | 13,171 | $ | 4,053,386 | |||||||||||||||||
President | 2017 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — |
Name and Principal Position |
| Salary | Bonus | Stock |
|
| Option |
|
| Non-Equity | All Other | Total |
| |||||||||||||||||||||||||
David D. Ossip |
| 2023 |
|
|
| $ | 800,000 |
|
|
| $ | — |
|
|
| $ | 12,439,889 |
|
|
| $ | — |
|
|
| $ | 337,320 |
|
|
| $ | 14,656 |
|
|
| $ | 13,591,865 |
|
Chair and Chief |
| 2022 |
|
|
| $ | 800,000 |
|
|
| $ | — |
|
|
| $ | 9,399,991 |
|
|
| $ | — |
|
|
| $ | 333,200 |
|
|
| $ | 18,415 |
|
|
| $ | 10,551,606 |
|
Executive Officer (9) | 2021 |
|
|
| $ | 775,000 |
|
|
| $ | — |
|
|
| $ | 2,649,979 |
|
|
| $ | 6,749,995 |
|
|
| $ | 400,000 |
|
|
| $ | 51,727 |
|
|
| $ | 10,626,701 |
| |
Samer Alkharrat | 2023 |
|
|
| $ | 304,231 |
|
|
| $ | 250,000 |
|
|
| $ | 4,999,960 |
|
|
| $ | — |
|
|
| $ | 258,020 |
|
|
| $ | 9,554 |
|
|
| $ | 5,821,765 |
| |
Executive Vice President, |
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| ||||||||
Chief Revenue Officer (9) |
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| ||||||||
Christopher R. Armstrong | 2023 |
|
|
| $ | 655,000 |
|
|
| $ | — |
|
|
| $ | 4,888,133 |
|
|
| $ | — |
|
|
| $ | 185,706 |
|
|
| $ | 9,900 |
|
|
| $ | 5,738,739 |
| |
Executive Vice President, | 2022 |
|
|
| $ | 655,000 |
|
|
| $ | — |
|
|
| $ | 3,946,432 |
|
|
| $ | — |
|
|
| $ | 163,685 |
|
|
| $ | 19,180 |
|
|
| $ | 4,784,297 |
| |
Chief Operating Officer | 2021 |
|
|
| $ | 655,000 |
|
|
| $ | — |
|
|
| $ | 3,196,392 |
|
|
| $ | — |
|
|
| $ | 196,500 |
|
|
| $ | 12,974 |
|
|
| $ | 4,060,866 |
| |
Stephen H. Holdridge |
| 2023 |
|
|
| $ | 650,000 |
|
|
| $ | — |
|
|
| $ | 5,735,944 |
|
|
| $ | — |
|
|
| $ | 178,724 |
|
|
| $ | 9,900 |
|
|
| $ | 6,574,568 |
|
President, |
| 2022 |
|
|
| $ | 625,000 |
|
|
| $ | — |
|
|
| $ | 3,914,916 |
|
|
| $ | — |
|
|
| $ | 187,425 |
|
|
| $ | 9,150 |
|
|
| $ | 4,736,491 |
|
Customer and Revenue Operations(9) |
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| ||||||||
Leagh E. Turner |
| 2023 |
|
|
| $ | 688,219 |
| (2) |
| $ | — |
|
|
| $ | 12,439,889 |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 188,266 |
|
|
| $ | 13,316,374 |
|
Former Co-Chief |
| 2022 |
|
|
| $ | 800,000 |
|
|
| $ | — |
|
|
| $ | 9,399,991 |
|
|
| $ | — |
|
|
| $ | 333,200 |
|
|
| $ | 20,150 |
|
|
| $ | 10,553,341 |
|
Executive Officer (9) | 2021 |
|
|
| $ | 655,000 |
|
|
| $ | — |
|
|
| $ | 1,571,968 |
|
|
| $ | 3,929,989 |
|
|
| $ | 262,000 |
|
|
| $ | 51,322 |
|
|
| $ | 6,470,279 |
| |
Noémie C. Heuland |
| 2023 |
|
|
| $ | 600,000 |
|
|
| $ | — |
|
|
| $ | 3,072,833 |
|
|
| $ | — |
|
|
| $ | 158,850 |
|
|
| $ | 9,900 |
|
|
| $ | 3,841,583 |
|
Former Executive |
| 2022 |
|
|
| $ | 600,000 |
|
|
| $ | — |
|
|
| $ | 3,429,872 |
|
|
| $ | — |
|
|
| $ | 149,940 |
|
|
| $ | 9,150 |
|
|
| $ | 4,188,962 |
|
Vice President, | 2021 |
|
|
| $ | 600,000 |
|
|
| $ | — |
|
|
| $ | 180,033 |
|
|
| $ | — |
|
|
| $ | 180,000 |
|
|
| $ | 12,515 |
|
|
| $ | 972,548 |
| |
Chief Financial Officer (9) |
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| 40 | 2024 PROXY STATEMENT |
Name | Year | Retirement Plan Contribution | Health Benefits | Life Insurance Benefits | Parking Benefit | Executive Physical | Recreational Club Dues | |||||||||||||||||||||
David D. Ossip | 2018 | $ | 19,432 | $ | 11,451 | $ | 1,027 | $ | 1,362 | $ | 2,486 | $ | 8,600 | |||||||||||||||
Chief Executive Officer | 2017 | $ | 20,682 | $ | 8,606 | $ | 1,190 | $ | 1,463 | $ | — | $ | 7,800 | |||||||||||||||
Paul D. Elliott | 2018 | $ | 13,933 | $ | 12,395 | $ | 1,027 | $ | 264 | $ | 1,864 | $ | 8,600 | |||||||||||||||
Chief Operating Officer | 2017 | $ | 14,716 | $ | 10,128 | $ | 1,190 | $ | 286 | $ | — | $ | 7,800 | |||||||||||||||
Leagh E. Turner | 2018 | $ | 8,243 | $ | 4,132 | $ | 342 | $ | 454 | $ | — | $ | — | |||||||||||||||
President | 2017 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — |
Outstanding
Name | Other Benefits | Retirement Plan Contribution(d) | Life Insurance Benefits(e) | Total |
| ||||||||||||||
Mr. Ossip |
| $ | 14,104 |
| (a) |
| $ | — |
|
|
| $ | 552 |
|
|
| $ | 14,656 |
|
Mr. Alkharrat |
| $ | — |
| (b) |
| $ | 9,554 |
|
|
| $ | — |
|
|
| $ | 9,554 |
|
Mr. Armstrong |
| $ | — |
| (b) |
| $ | 9,900 |
|
|
| $ | — |
|
|
| $ | 9,900 |
|
Mr. Holdridge |
| $ | — |
| (b) |
| $ | 9,900 |
|
|
| $ | — |
|
|
| $ | 9,900 |
|
Ms. Turner |
| $ | 187,783 |
| (c) |
| $ | — |
|
|
| $ | 483 |
|
|
| $ | 188,266 |
|
Ms. Heuland |
| $ | — |
| (b) |
| $ | 9,900 |
|
|
| $ | — |
|
|
| $ | 9,900 |
|
| 41 | 2024 PROXY STATEMENT |
Grant of Plan Based Awards in Fiscal Year 2023
During Fiscal Year 2023, plan-based awards granted to our NEOs included PSUs and RSUs granted under the 2018 EIP, as well as cash awards under the 2023 MIP and the 2023 SIP. The following table summarizes all plan-based awards granted to our NEOs during Fiscal Year 2023.
|
| Estimated Future Payouts |
| Estimated Future Payouts | All Other Stock |
|
| Grant Date Fair |
|
| ||||||||||||||||||||||||||||||||||||
Name | Grant Date | Threshold | Target | Maximum |
| Threshold | Target | Maximum |
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||
Mr. Ossip |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
STI - Cash |
|
| — |
|
|
| $ | 66,800 |
|
|
| $ | 400,000 |
|
|
| $ | 668,000 |
|
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
STI - PSUs |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 73,490 |
|
|
| $ | 440,060 |
|
|
| $ | 734,900 |
|
|
|
| 6,034 |
|
|
| $ | 440,060 |
|
| |
fPSUs |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 834,989 |
|
|
| $ | 4,999,935 |
|
|
| $ | 8,349,891 |
|
|
|
| 68,558 |
|
|
| $ | 4,999,935 |
|
| |
mPSUs(3) |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 999,980 |
|
|
| $ | 1,999,959 |
|
|
| $ | 3,999,918 |
|
|
|
| 27,423 |
|
|
| $ | 1,999,959 |
|
| |
RSUs(4) |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| 68,558 |
|
|
| $ | 4,999,935 |
|
| |
Mr. Alkharrat |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
STI - Cash(6) |
|
| — |
|
|
| $ | 14,206 |
|
|
| $ | 340,273 |
|
|
|
| — |
|
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
RSUs(4) |
| 6/9/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| 78,814 |
|
|
| $ | 4,999,960 |
|
| |
Mr. Armstrong |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
STI - Cash |
|
| — |
|
|
| $ | 12,262 |
|
|
| $ | 262,000 |
|
|
| $ | 437,540 |
|
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
STI - PSUs |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 13,489 |
|
|
| $ | 288,219 |
|
|
| $ | 481,326 |
|
|
|
| 3,952 |
|
|
| $ | 288,219 |
|
| |
fPSUs |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 333,993 |
|
|
| $ | 1,999,959 |
|
|
| $ | 3,339,932 |
|
|
|
| 27,423 |
|
|
| $ | 1,999,959 |
|
| |
mPSUs(3) |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 299,998 |
|
|
| $ | 599,995 |
|
|
| $ | 1,199,990 |
|
|
|
| 8,227 |
|
|
| $ | 599,995 |
|
| |
RSUs(4) |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| 27,423 |
|
|
| $ | 1,999,959 |
|
| |
Mr. Holdridge |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
STI - Cash |
|
| — |
|
|
| $ | 12,168 |
|
|
| $ | 260,000 |
|
|
| $ | 447,200 |
|
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
STI - PSUs |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 13,386 |
|
|
| $ | 286,031 |
|
|
| $ | 491,973 |
|
|
|
| 3,922 |
|
|
| $ | 286,031 |
|
| |
fPSUs |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 333,993 |
|
|
| $ | 1,999,959 |
|
|
| $ | 3,339,932 |
|
|
|
| 27,423 |
|
|
| $ | 1,999,959 |
|
| |
Holdridge PSU(7) |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 425,000 |
|
|
| $ | 849,999 |
|
|
| $ | 1,699,998 |
|
|
|
| 11,655 |
|
|
| $ | 849,999 |
|
| |
mPSUs(3) |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 299,998 |
|
|
| $ | 599,995 |
|
|
| $ | 1,199,990 |
|
|
|
| 8,227 |
|
|
| $ | 599,995 |
|
| |
RSUs(4) |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| 27,423 |
|
|
| $ | 1,999,959 |
|
| |
Ms. Turner |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
STI - Cash |
|
| — |
|
|
| $ | 66,800 |
|
|
| $ | 400,000 |
|
|
| $ | 668,000 |
|
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
STI - PSUs |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 73,490 |
|
|
| $ | 440,060 |
|
|
| $ | 734,900 |
|
|
|
| 6,034 |
|
|
| $ | 440,060 |
|
| |
fPSUs |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 834,989 |
|
|
| $ | 4,999,935 |
|
|
| $ | 8,349,891 |
|
|
|
| 68,558 |
|
|
| $ | 4,999,935 |
|
| |
mPSUs(3) |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 999,980 |
|
|
| $ | 1,999,959 |
|
|
| $ | 3,999,918 |
|
|
|
| 27,423 |
|
|
| $ | 1,999,959 |
|
| |
RSUs(4) |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| 68,558 |
|
|
| $ | 4,999,935 |
|
| |
Ms. Heuland |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
STI - Cash |
|
| — |
|
|
| $ | 11,250 |
|
|
| $ | 180,000 |
|
|
| $ | 270,000 |
|
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
STI - PSUs |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 12,375 |
|
|
| $ | 198,005 |
|
|
| $ | 297,008 |
|
|
|
| 2,715 |
|
|
| $ | 198,005 |
|
| |
fPSUs |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 208,741 |
|
|
| $ | 1,249,947 |
|
|
| $ | 2,087,411 |
|
|
|
| 17,139 |
|
|
| $ | 1,249,947 |
|
| |
mPSUs(3) |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| $ | 187,467 |
|
|
| $ | 374,933 |
|
|
| $ | 749,866 |
|
|
|
| 5,141 |
|
|
| $ | 374,933 |
|
| |
RSUs(4) |
| 2/28/2023 |
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
|
| — |
|
|
|
| — |
|
|
|
| — |
|
|
|
| 17,139 |
|
|
| $ | 1,249,947 |
|
|
| 42 | 2024 PROXY STATEMENT |
OutstandingEquity Awards as of December 31, 2023
The following table sets forth certain information about outstanding equity awards held by our NEOs as of December 31, 2018.2023.
Option Awards | Stock Awards | |||||||||||||||||||||||||||
Name | Grant Date | Number of securities underlying unexercised options exercisable (#) | Number of securities underlying unexercised options unexercisable (#) | Option exercise price ($) | Option expiration date | Equity incentive plan awards: Number of share awards that have not vested (#) | Equity incentive plan awards: Market value of share awards that have not vested ($) | |||||||||||||||||||||
David D. Ossip | 11/01/2013 | 2,000,000 | — | (1) | $ | 16.80 | 11/01/2023 | |||||||||||||||||||||
Chief Executive Officer | 03/30/2016 | 3,495 | 3,496 | (2) | $ | 17.88 | 03/30/2026 | |||||||||||||||||||||
03/20/2017 | 312,500 | 937,500 | (3) | $ | 17.20 | 03/20/2027 | ||||||||||||||||||||||
03/20/2017 | 375,000 | (4) | $ | 12,933,750 | (5) | |||||||||||||||||||||||
04/25/2018 | — | 1,358,697 | (6) | $ | 22.00 | 04/25/2028 | ||||||||||||||||||||||
Paul D. Elliott | 06/01/2016 | 214,866 | 250,000 | (7) | $ | 16.74 | 06/01/2026 | |||||||||||||||||||||
Chief Operating Officer | 04/25/2018 | — | 489,132 | (8) | $ | 22.00 | 04/25/2028 | |||||||||||||||||||||
Leagh E. Turner | 09/04/2018 | — | 100,000 | (9) | $ | 38.63 | 09/04/2028 | |||||||||||||||||||||
President | 09/04/2018 | 50,000 | (10) | $ | 1,724,500 | (5) |
|
|
|
| Stock Option Awards (1) (3) | Stock Awards (2) (3) |
| ||||||||||||||||||||||
Name | Type of Award |
| Grant Date | Number of securities underlying unexercised options exercisable (#) |
| Number of securities underlying unexercised options unexercisable (#) |
| Number of securities underlying unexercised unearned options (#) |
| Option exercise price ($) |
| Option expiration date | Number of shares or units of stock that have not vested (#) |
| Market value of shares or units of stock that have not vested ($) |
| Number of unearned shares or units of stock that have not vested (#) |
| Market value of unearned shares or units of stock that have not vested ($) |
| ||||||||
Mr. Ossip | STI - PSU(4) |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 5,088 |
| $ | 341,507 |
| -- |
| -- |
| ||||||
| fPSU(5) |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 18,570 |
| $ | 1,246,418 |
|
| 45,706 |
| $ | 3,067,787 |
| ||||
| RSU |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 68,558 |
| $ | 4,601,613 |
| -- |
| -- |
| ||||||
| mPSU(6) |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 27,423 |
| $ | 1,840,632 |
| -- |
| -- |
| ||||||
| PSU |
| 2/24/2022 | -- |
| -- |
| -- |
| -- |
| -- |
| 35,282 |
| $ | 2,368,128 |
| -- |
| -- |
| ||||||
| RSU |
| 2/24/2022 | -- |
| -- |
| -- |
| -- |
| -- |
| 42,355 |
| $ | 2,842,868 |
| -- |
| -- |
| ||||||
| PSU |
| 3/8/2021 | -- |
| -- |
| -- |
| -- |
| -- |
| 9,265 |
| $ | 621,867 |
| -- |
| -- |
| ||||||
| SO |
| 3/8/2021 |
| 113,465 |
|
| 113,466 |
| -- |
| $ | 80.95 |
| 3/8/2031 | -- |
| -- |
| -- |
| -- |
| |||||
| PSO(7) |
| 5/8/2020 | -- |
|
| 750,000 |
|
| 750,000 |
| $ | 65.26 |
| -- | -- |
| -- |
| -- |
| -- |
| |||||
| SO |
| 5/8/2020 |
| 241,300 |
|
| 80,434 |
| -- |
| $ | 65.26 |
| 5/8/2030 | -- |
| -- |
| -- |
| -- |
| |||||
| SO |
| 3/20/2019 |
| 1,750,000 |
| -- |
| -- |
| $ | 49.93 |
| 3/20/2029 | -- |
| -- |
| -- |
| -- |
| ||||||
| SO |
| 2/8/2019 |
| 10,390 |
| -- |
| -- |
| $ | 44.91 |
| 2/8/2029 | -- |
| -- |
| -- |
| -- |
| ||||||
| SO |
| 4/26/2018 |
| 858,697 |
| -- |
| -- |
| $ | 22.00 |
| 4/26/2028 | -- |
| -- |
| -- |
| -- |
| ||||||
Mr. Alkharrat | RSU |
| 6/9/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 78,814 |
| $ | 5,289,996 |
| -- |
| -- |
| ||||||
Mr. Armstrong | STI - PSU(4) |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 2,801 |
| $ | 188,003 |
| -- |
| -- |
| ||||||
| fPSU(5) |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 7,428 |
| $ | 498,567 |
|
| 18,282 |
| $ | 1,227,088 |
| ||||
| RSU |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 27,423 |
| $ | 1,840,632 |
| -- |
| -- |
| ||||||
| mPSU(6) |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 8,227 |
| $ | 552,196 |
| -- |
| -- |
| ||||||
| PSU |
| 2/24/2022 | -- |
| -- |
| -- |
| -- |
| -- |
| 11,760 |
| $ | 789,331 |
| -- |
| -- |
| ||||||
| RSU |
| 2/24/2022 | -- |
| -- |
| -- |
| -- |
| -- |
| 14,118 |
| $ | 947,600 |
| -- |
| -- |
| ||||||
| PSU |
| 3/8/2021 | -- |
| -- |
| -- |
| -- |
| -- |
| 6,177 |
| $ | 414,600 |
| -- |
| -- |
| ||||||
| RSU |
| 3/8/2021 | -- |
| -- |
| -- |
| -- |
| -- |
| 6,177 |
| $ | 414,600 |
| -- |
| -- |
| ||||||
| SO |
| 5/8/2020 |
| 80,433 |
|
| 26,811 |
| -- |
| $ | 65.26 |
| 5/8/2030 | -- |
| -- |
| -- |
| -- |
| |||||
| SO |
| 2/8/2019 |
| 50,000 |
| -- |
| -- |
| $ | 44.91 |
| 2/8/2029 | -- |
| -- |
| -- |
| -- |
| ||||||
| SO |
| 2/8/2019 |
| 2,301 |
| -- |
| -- |
| $ | 44.91 |
| 2/8/2029 | -- |
| -- |
| -- |
| -- |
| ||||||
Mr. Holdridge | STI - PSU(4) |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 2,696 |
| $ | 180,956 |
| -- |
| -- |
| ||||||
| fPSU(5) |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 7,428 |
| $ | 498,567 |
|
| 18,282 |
| $ | 1,227,088 |
| ||||
| RSU |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 27,423 |
| $ | 1,840,632 |
| -- |
| -- |
| ||||||
| mPSU(6) |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 8,227 |
| $ | 552,196 |
| -- |
| -- |
| ||||||
| PSU(8) |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 11,655 |
| $ | 782,284 |
| -- |
| -- |
| ||||||
| PSU |
| 2/24/2022 | -- |
| -- |
| -- |
| -- |
| -- |
| 11,760 |
| $ | 789,331 |
| -- |
| -- |
| ||||||
| RSU |
| 2/24/2022 | -- |
| -- |
| -- |
| -- |
| -- |
| 14,118 |
| $ | 947,600 |
| -- |
| -- |
| ||||||
| PSU |
| 3/8/2021 | -- |
| -- |
| -- |
| -- |
| -- |
| 3,088 |
| $ | 207,267 |
| -- |
| -- |
| ||||||
| RSU |
| 3/8/2021 | -- |
| -- |
| -- |
| -- |
| -- |
| 3,088 |
| $ | 207,267 |
| -- |
| -- |
| ||||||
| SO |
| 2/28/2020 |
| 49,160 |
|
| 16,387 |
| -- |
| $ | 70.73 |
| 2/28/2030 | -- |
| -- |
| -- |
| -- |
| |||||
Ms. Turner | SO(9) |
| 3/8/2021 |
| 66,062 |
| -- |
| -- |
| $ | 80.95 |
| 2/10/2024 | -- |
| -- |
| -- |
| -- |
| ||||||
Ms. Heuland | STI - PSU(4) |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 2,396 |
| $ | 160,820 |
| -- |
| -- |
| ||||||
| fPSU(5) |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 4,642 |
| $ | 311,571 |
|
| 11,426 |
| $ | 766,913 |
| ||||
| RSU |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 17,139 |
| $ | 1,150,370 |
| -- |
| -- |
| ||||||
| mPSU(6) |
| 2/28/2023 | -- |
| -- |
| -- |
| -- |
| -- |
| 5,141 |
| $ | 345,064 |
| -- |
| -- |
| ||||||
| PSU |
| 2/24/2022 | -- |
| -- |
| -- |
| -- |
| -- |
| 9,800 |
| $ | 657,776 |
| -- |
| -- |
| ||||||
| RSU |
| 2/24/2022 | -- |
| -- |
| -- |
| -- |
| -- |
| 11,765 |
| $ | 789,667 |
| -- |
| -- |
|
|
|
|
|
|
|
|
|
|
|
|
Employment
There is no public market for the STI - PSUs. For purposes of this disclosure, we have valued the STI - PSUs as of December 29, 2023, based on the then fair market value of our Common Stock of $67.12 per share. The shares fully vest on the first anniversary of the grant date, subject to achieving the performance criteria. As discussed under the “Management Incentive Plan" section the STI - PSU metrics achieved at 84.33% of target.
This results in the following for Mr. Ossip:
The PSU metrics achieved 70.88%, 68.74%, and 88.25% respectively for Messrs. Armstrong and Holdridge, and Ms. Heuland when factoring in performance against their individual performance against goals and different weightings for each of their respective STI targets.
| 44 | 2024 PROXY STATEMENT |
Stock Option Exercises and Stock Vested in Fiscal 2023
The following table shows the number of shares acquired and the value realized upon the exercise of stock options or the vesting of stock awards during Fiscal Year 2023.
Name | Number of | Value realized | Number of shares | Value realized | ||||||||||||||||
Mr. Ossip |
| - |
|
|
| - |
|
|
|
| 65,323 |
| (3) |
| $ | 4,594,218 |
|
| ||
Mr. Alkharrat |
| - |
|
|
| - |
|
|
| - |
|
|
| - |
|
| ||||
Mr. Armstrong |
| - |
|
|
| - |
|
|
|
| 55,035 |
|
|
| $ | 3,910,242 |
|
| ||
Mr. Holdridge |
| - |
|
|
| - |
|
|
|
| 31,644 |
|
|
| $ | 2,241,209 |
|
| ||
Ms. Turner |
|
| 69,668 |
|
|
| $ | 1,620,717 |
|
|
|
| 68,620 |
| (4) |
| $ | 4,883,998 |
|
|
Ms. Heuland |
| - |
|
|
| - |
|
|
|
| 34,802 |
|
|
| $ | 2,384,809 |
|
|
| 45 | 2024 PROXY STATEMENT |
Nonqualified Deferred Compensation in Fiscal Year 2023
The following table sets forth certain information about vested RSUs in Fiscal Year 2023 for which the issuance of the underlying shares of Common Stock has been deferred by the NEOs who are Canadian residents pursuant to the terms of the 2018 EIP and the underlying RSU award agreement. All amounts reported below are deferrals of the issuance of shares of Common Stock from the vested RSU awards disclosed above under “Compensation Elements” and are not in addition to any RSU awards previously disclosed.
Name | Executive | Aggregate | Aggregate | Aggregate balance | ||||||||||||||||
Mr. Ossip |
| $ | 4,384,480 |
|
|
| $ | 1,601,650 |
|
|
|
| — |
|
|
| $ | 40,580,685 |
|
|
Ms. Turner |
| $ | 4,605,774 |
|
|
| $ | 303,053 |
|
|
|
| — |
|
|
| $ | 11,454,565 |
|
|
| 46 | 2024 PROXY STATEMENT |
Potential Payments Upon Termination or Change in Control
Our NEOs are entitled to receive severance payments upon termination of employment, or a termination of employment in connection with a change in control as provided in their respective employment agreements, as further described below in “Agreements with our NEOs.” In addition, certain equity awards may be accelerated upon a change of control, as further described above in “Outstanding Equity Awards as of December 31, 2023.” The table below presents the estimated value of payments and benefits that each NEO would have been entitled to receive if the specified triggering event had occurred on December 31, 2023. Unless otherwise noted below, all payments are to be made in a lump sum upon or shortly after the applicable termination.
Name / Triggering Event |
| Severance |
|
|
| Health/ |
|
|
| Outplacement |
|
|
| Accelerated |
|
|
| Totals |
|
| |||||||
Mr. Ossip |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
• |
| Change in Control Without Termination(5) |
| $ | — |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 18,421,327 |
|
|
| $ | 18,421,327 |
|
|
• |
| Termination Without Cause or Resignation for Good Reason, After Change in Control |
| $ | 3,866,455 |
|
|
| $ | 2,037 |
|
|
| $ | 9,057 |
|
|
| $ | 18,421,327 |
|
|
| $ | 22,298,876 |
|
|
• |
| Termination Without Cause or Resignation for Good Reason, with no Change in Control |
| $ | 3,866,455 |
|
|
| $ | 2,037 |
|
|
| $ | 9,057 |
|
|
| $ | 16,737,827 |
|
|
| $ | 20,615,376 |
|
|
• |
| Termination due to Death |
| $ | 1,600,000 |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 18,421,327 |
|
|
| $ | 20,021,327 |
|
|
• |
| Termination due to Disability |
| $ | 800,000 |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 1,395,000 |
|
|
| $ | 2,195,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mr. Alkharrat |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
• |
| Change in Control Without Termination |
| $ | — |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 5,289,996 |
|
|
| $ | 5,289,996 |
|
|
• |
| Termination Without Cause, After Change in Control |
| $ | 1,350,000 |
|
|
| $ | 20,347 |
|
|
| $ | 10,000 |
|
|
| $ | 5,289,996 |
|
|
| $ | 6,670,343 |
|
|
• |
| Termination Without Cause, with no Change in Control |
| $ | 1,350,000 |
|
|
| $ | 20,347 |
|
|
| $ | 10,000 |
|
|
| $ | 3,526,619 |
|
|
| $ | 4,906,966 |
|
|
• |
| Termination due to Death |
| $ | 600,000 |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 5,289,996 |
|
|
| $ | 5,889,996 |
|
|
• |
| Termination due to Disability |
| $ | 600,000 |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 600,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mr. Armstrong |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
• |
| Change in Control Without Termination |
| $ | — |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 6,849,393 |
|
|
| $ | 6,849,393 |
|
|
• |
| Termination Without Cause or Resignation for Good Reason, After Change in Control |
| $ | 1,506,500 |
|
|
| $ | 10,173 |
|
|
| $ | 10,000 |
|
|
| $ | 6,849,393 |
|
|
| $ | 8,376,066 |
|
|
• |
| Termination Without Cause or Resignation for Good Reason, with no Change in Control |
| $ | 1,506,500 |
|
|
| $ | 10,173 |
|
|
| $ | 10,000 |
|
|
| $ | 6,185,981 |
|
|
| $ | 7,712,654 |
|
|
• |
| Termination due to Death |
| $ | 524,000 |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 6,849,393 |
|
|
| $ | 7,373,393 |
|
|
• |
| Termination due to Disability |
| $ | 524,000 |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 524,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mr. Holdridge |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
• |
| Change in Control Without Termination |
| $ | — |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 7,167,208 |
|
|
| $ | 7,167,208 |
|
|
• |
| Termination Without Cause, After Change in Control |
| $ | 1,690,000 |
|
|
| $ | 9,885 |
|
|
| $ | 10,000 |
|
|
| $ | 7,167,208 |
|
|
| $ | 8,877,093 |
|
|
• |
| Termination Without Cause, with no Change in Control |
| $ | 1,690,000 |
|
|
| $ | 9,885 |
|
|
| $ | 10,000 |
|
|
| $ | 6,553,664 |
|
|
| $ | 8,263,549 |
|
|
• |
| Termination due to Death |
| $ | 520,000 |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 7,167,208 |
|
|
| $ | 7,687,208 |
|
|
• |
| Termination due to Disability |
| $ | 520,000 |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 520,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Ms. Heuland |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
• |
| Change in Control Without Termination |
| $ | — |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 4,093,246 |
|
|
| $ | 4,093,246 |
|
|
• |
| Termination Without Cause, After Change in Control |
| $ | 1,320,000 |
|
|
| $ | 10,215 |
|
|
| $ | 10,000 |
|
|
| $ | 4,093,246 |
|
|
| $ | 5,433,461 |
|
|
• |
| Termination Without Cause, with no Change in Control |
| $ | 1,320,000 |
|
|
| $ | 10,215 |
|
|
| $ | 10,000 |
|
|
| $ | 3,709,790 |
|
|
| $ | 5,050,004 |
|
|
• |
| Termination due to Death |
| $ | 360,000 |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 4,093,246 |
|
|
| $ | 4,453,246 |
|
|
• |
| Termination due to Disability |
| $ | 360,000 |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | — |
|
|
| $ | 360,000 |
|
|
| 47 | 2024 PROXY STATEMENT |
In the event of a termination due to death or disability, Ms. Heuland and Messrs. Ossip, Alkharrat, Armstrong, and Holdridge would receive a pro-rated STI payment at the annual target amount, if any, to which the executive would otherwise have become entitled for the fiscal year in which their death or disability occurs had the executive remained continuously employed for the full fiscal year. Additionally, in the event of a termination due to death, Mr. Ossip would receive a lump sum payment equal to 12 months of his base salary.
In October 2023, Ms. Turner submitted her resignation from her role as Co-Chief Executive Officer, effective as of November 10, 2023; therefore, she is not entitled to receive severance payments upon termination of employment, or a termination of employment in connection with a change in control. Ms. Turner did not receive severance benefits or payments upon termination, with the exception of a Time Away From Work (TAFW) payout in the amount of $163,069.
| 48 | 2024 PROXY STATEMENT |
Agreements with our NEOs
General
We are party to employment agreements with each of our current NEOs. Additionally, on August 7, 2018, we entered into a separation and consulting agreement with Mr. Elliott. The material provisions of each such agreement are described below.
David D. Ossip
In April 2012, we entered into an employment agreement with David D. Ossip, our Chief Executive Officer. The agreement provides for an indefinite term beginning on January 1, 2012. The agreement provides that Mr. Ossip would receive an annualized base salary, subject to annual compensation reviews by our Board. In 2018, Mr. Ossip’s base salary was $700,000 USD. The agreement also provides that Mr. Ossip is eligible to receive an annual performance-based cash bonus based on Mr. Ossip’s performance. In 2018, Mr. Ossip’s annual cash bonus at target was $800,000 USD. During the year ended December 31, 2018, Mr. Ossip received $800,000 USD for his 2018 annual performance-based cash bonus, which represented approximately 114% of his base salary, of which forty percent (40%) was earned as a result of the achievement of a Company financial goal under the 2018 annual performance-based cash incentive plan and sixty percent (60%) was paid pursuant to the compensation committee’s discretion in light of the many positive developments led by management in 2018, including the execution of one of the most successful initial public offerings in 2018 and new records in Dayforce and Cloud revenue. Further, in light of these positive developments, Mr. Ossip received an option to purchase 10,390 shares of Common Stock on February 8, 2019 representing the fair value of approximately 15% of his 2018 annual performance-based cash bonus at target.
In addition to the above, Mr. Ossipitems discussed, each of our current NEOs participates in the employee health and welfare, retirement, and other employee benefits programs offered generally from time to time by us to our senior executive employees.employees based on the location of their employment.
EitherDavid D. Ossip
In April 2012, we orentered into an employment agreement with David D. Ossip, our Chair and Chief Executive Officer. Mr. OssipOssip’s 2023 base salary and incentive compensation arrangements are discussed in the CD&A above.
Samer Alkharrat
In June 2023, we entered into an employment agreement with Samer Alkharrat, our Executive Vice President, Chief Revenue Officer. Mr. Alkharrat’s 2023 base salary and incentive compensation arrangements are discussed in the CD&A above.
Christopher R. Armstrong
In May 2019, we entered into an employment agreement with Christopher R. Armstrong, in connection with his appointment as Executive Vice President, Chief Operating Officer, the position he now holds again as of February 23, 2022, after having served as Executive Vice President, Chief Customer Officer for approximately two years. Mr. Armstrong’s 2023 base salary and incentive compensation arrangements are discussed in the CD&A above.
Stephen H. Holdridge
In December 2019, we entered into an employment agreement with Stephen H. Holdridge, in connection with his employment as Global Head of Services. In February 2023, we entered into an amended and restated employment agreement with Mr. Holdridge, reflecting his appointment as President, Customer and Revenue Operations. Mr. Holdridge’s 2023 base salary and incentive compensation arrangements are discussed in the CD&A above.
Leagh E. Turner
In February 2022, we entered into an amended and restated employment agreement with Leagh E. Turner, our former Co-Chief Executive Officer. Ms. Turner’s 2023 base salary and incentive compensation arrangements are discussed in the CD&A above. Ms. Turner resigned as Co-Chief Executive Officer and as a member of the Board of Directors of the Company effective on November 10, 2023.
Noémie C. Heuland
In September 2020, we entered into an employment agreement with Noémie C. Heuland, our former Executive Vice President, Chief Financial Officer. Ms. Heuland resigned as Executive Vice President, Chief Financial Officer effective December 31, 2023. In connection with her resignation, in December 2023, we entered into a consulting agreement with Ms. Heuland to provide advisory services to the Company related to the chief financial officer transition from January 1, 2024, until March 1, 2024. Pursuant to the consulting agreement, Ms. Heuland provided consulting services as requested from time to time by us at a rate not to exceed $2,300 per day for the period. Ms. Heuland's consulting agreement provided for continued vesting of her STI and LTI equity awards through the consulting period, as further described in the Summary Compensation Table on page 40 of this Proxy Statement. Ms. Heuland’s 2023 base salary and incentive compensation arrangements are discussed in the CD&A above.
Termination of Agreements
The agreements with our NEOs provide that we may terminate the agreement any time upon written notice or any timeour agreements with our NEOs immediately, and our NEOs may terminate their agreements with 90 days’ prior written notice, respectively. Wenotice. Further, we may terminate Mr. Ossip’s employmentan NEO’s relationship with us for death, “disability,” or with or without “cause,” as defined in the employment agreement, by written notice to Mr. Ossip. Mr.their respective agreements. Messrs. Ossip, Holdridge, Armstrong, and Alkharrat may resign with prior written notice for “good reason.” The
| 49 | 2024 PROXY STATEMENT |
If we terminate Mr. Ossip’s employment without “cause” or Mr. Ossip terminates his employment for “good reason,” then we must provide Mr. Ossip with (i) an amount equal to 24 months of his annual base salary, (ii) an amount equal to two times the average bonus payment
amounts that could be paid to Mr. Ossip for the immediately preceding two years, (iii) reasonable executive-level outplacement services for a period of up to 12 months, not to exceed $12,000 CAD (or $8,800 USD as of December 31, 2018)NEOs under various termination situations, and (iv) continuation of certain employment related benefits for the period prescribed under the Employment Standards Act (Ontario).
In the event that Mr. Ossip’s employment is terminated due to his death, we must provide Mr. Ossip’s beneficiaries with (i) an amount equal to 12 months of his annual base salary, and (ii) apro-rated bonus, if any, to which Mr. Ossip would have become entitled for the fiscal year in which his termination occurs based on actual performance. In the event that Mr. Ossip’s employment is terminated due to “disability,” we must provide Mr. Ossip with apro-rated bonus, if any, to which Mr. Ossip would have become entitled for the fiscal year in which his termination occurs based on actual performance.
For purposesexplanation of the applicable calculations, are set forth under “Potential Payments Upon Termination or Change in Control” above.
Restrictive Covenants
Pursuant to a separate amended and restated restrictive covenant agreement, “good reason” means any act, or failure to act, or omission by us that would constitute at law in the Province of Ontario constructive dismissal of Mr. Ossip, including without limitation the occurrence of one or more of the following conditions, without Mr. Ossip’s consent: (i) any material adverse change in his duties, roles and responsibilities, (ii) any adverse change to Mr. Ossip’s line of reporting or (iii) the relocation of his principal place of employment by more than 40 kilometers; provided that any such condition will only constitute good reason if Mr. Ossip provides us with a prior written notice of his intent to resign for good reason (which notice must reference the definition of good reason in his employment agreement and include a description of the factors constituting the alleged good reason) andwhich we have not remedied the alleged violations within 30 days of such notice.
For purposes of the agreement, “cause” means any event, act, or failure to act, or omission by Mr. Ossip which would constitute at law in the Province of Ontario cause for dismissal, including without limitation (i) conduct involving material theft or misappropriation of our assets and those of our affiliates, (ii) fraud or embezzlement of a material nature against us and our affiliates, (iii) any material act of dishonesty, financial or otherwise, against us and our affiliates or (iv) any conviction of an indictable offense under the Canadian Criminal Code.
The agreement includes perpetual confidentiality provisions, as well as provisions relating to assignment of inventions.
In addition,entered into in March 2017, Mr. Ossip was granted options to purchase 1,250,000 shares of Common Stock and was granted restricted stock units relating to 500,000 shares of Common Stock (collectively, the “Equity Awards”). Such Equity Awards served as consideration for Mr. Ossip to enter into an Amended and Restated Restrictive Covenants Agreement with Ceridian Holding LLC, Ceridian LLC, Ceridian Canada Ltd. and Ceridian Dayforce Corporation, which became effective as of March 20, 2017 (the “Restrictive Covenants Agreement”). Under the Restrictive Covenants Agreement, Mr. Ossip has agreed among other things, that subsequent to any termination, he will not engage in, consult for, or own more than 5% of any business that is similar to that of our business in any country in which we do business for a period of 24 months subsequent to such termination. We may elect to extend such restriction period by a total of either 12 months or 24 months, so long asprovided we pay Mr. Ossip a lump sum equal to his prior year’s base salary, plus $800,000, USD, for each year the restriction period is extended.
Paul D. Elliott
SeparationThe agreements with our other NEOs contain non-competition and Consulting Agreement
On August 7, 2018, we entered into a Separationnon-solicitation provisions that apply during employment and Consulting Agreement (the “Separation Agreement”) with Paul D. Elliott, our then President and Chief Operating Officer in connection with his mutually agreed
termination of employment to be effective as of May 1, 2019 (the “Separation Date”). Mr. Elliott immediately resigned as our President but will continue to serve as our Chief Operating Officer through the Separation Date. Within ten business days following Mr. Elliott’s execution of a general release of claims after the Separation Date, Mr. Elliott will receive: (i) a lump sum payment of $950,000 CAD (or $696,634 USD as of December 31, 2018), (ii) apro-rated bonus for the 2019 fiscal year based on actual achievement of performance goals and (iii) reasonable executive-level outplacement services for a certain period of up to 12 months, not to exceed $12,000 CAD (or $8,800 as of December 31, 2018). Pursuant to the Separation Agreement, Mr. Elliott reaffirmed the restrictive covenants contained in his employment agreement. The Separation Agreement supersedes all previous agreements between ustime thereafter: (1) Ms. Turner and Mr. Elliott relating to hisArmstong, 18 months; and (2) Ms. Heuland and Messrs. Holdridge and Alkharrat, 12 months.
All employment other than to the extent that Mr. Elliott’s employment agreement, as described below, is amended by the Separation Agreement and continues in force until the Separation Date, and each of us and Mr. Elliott released and discharged the other in respect of such previous agreements.
Following the Separation Date, Mr. Elliott will be engaged without interruption as a consultant through June 30, 2020 (the “Consulting Period”). During the Consulting Period, Mr. Elliott will provide general business consultation services to us, including with respect to the operations and customer support areas of our business. The only consideration that Mr. Elliott will receive during the Consulting Period is continued vesting of his outstanding stock options in accordance with the terms of the applicable award agreements.
Employment Agreement
In April 2016, we entered into an employment agreement with Mr. Elliott. The agreement provides for an indefinite term beginning on April 20, 2016. The agreement provides that Mr. Elliott would receive an annualized base salary, subject to annual compensation reviews by our Board. In 2018, Mr. Elliott’s base salary was $475,000 CAD (or $348,317 USD as of December 31, 2018). The agreement also provides that Mr. Elliott is eligible to receive an annual performance-based cash bonus with a target amount of 80% of his annual base salary. During the year ended December 31, 2018, Mr. Elliott received $380,000 CAD (or $278,654 USD as of December 31, 2018) for his 2018 annual performance-based cash bonus, which represented 80% of his base salary, of which forty percent (40%) was earned as a result of the achievement of a Company financial goal under the 2018 annual performance-based cash incentive plan and sixty percent (60%) was paid pursuant to the compensation committee’s discretion in light of the many positive developments led by management in 2018, including the execution of one of the most successful initial public offerings in 2018 and new records in Dayforce and Cloud revenue. Further, in light of these positive developments, Mr. Elliott received an option to purchase 3,619 shares of Common Stock on February 8, 2019 representing the fair value of approximately 15% of his 2018 annual performance-based cash bonus at target.
In addition, on November 18, 2013, we entered into a “Success Bonus Plan” with key employees as of that date, including Mr. Elliott. Under the terms of Mr. Elliott’s Success Bonus Plan, he is entitled to receive a cash bonus of $600,000 USD, fifty percent (50%) of which was paid upon signing his employment agreement in April 2016, twenty-five percent (25%) was paid on April 28, 2017, and the remaining twenty-five percent (25%) was paid on April 30, 2018.
In addition to the above, Mr. Elliott participated in the employee health and welfare, retirement and other employee benefits programs offered generally from time to time by us to our senior executive employees.
Either we or Mr. Elliott may terminate the agreement any time upon written notice or any time with 60 days’ prior written notice, respectively. We may terminate Mr. Elliott’s employment for death, “disability,” or “cause” by written notice to Mr. Elliott. Mr. Elliott may resign with prior written notice for “good reason.”
If we terminate Mr. Elliott’s employment without “cause” or Mr. Elliott terminates his employment for “good reason,” then we must provide Mr. Elliott with (i) an amount equal to 24 months of his annual base salary, (ii) apro-rated bonus (at target level) for the fiscal year in which his termination occurs, (iii) reasonable
executive-level outplacement services for a period of up to 12 months, not to exceed $12,000 CAD (or $8,800 USD as of December 31, 2018), and (iv) continuation of certain employment related benefits for the period prescribed under the Employment Standards Act (Ontario).
In the event that Mr. Elliott’s employment is terminated due to his death, we must provide Mr. Elliott’s beneficiaries with (i) an amount equal to 12 months of his annual base salary, and (ii) apro-rated bonus, if any, to which Mr. Elliott would have become entitled for the fiscal year in which his termination occurs based on actual performance. In the event that Mr. Elliott’s employment is terminated due to “disability,” we must provide Mr. Elliott with apro-rated bonus, if any, to which Mr. Elliott would have become entitled for the fiscal year in which his termination occurs based on actual performance.
For purposes of the agreement, “good reason” means any act, or failure to act, or omission by us that would constitute at law in the Province of Ontario constructive dismissal of Mr. Elliott, including without limitation the occurrence of one or more of the following conditions, without Mr. Elliott’s consent: (i) any material adverse change in his duties, roles and responsibilities, (ii) any adverse change to Mr. Elliott’s line of reporting or (iii) the relocation of his principal place of employment by more than 50 kilometers; provided that any such condition will only constitute good reason if Mr. Elliott provides us with a prior written notice of his intent to resign for good reason (which notice must reference the definition of good reason in his employment agreement andagreements include a description of the factors constituting the alleged good reason) and we have not remedied the alleged violations within 30 days of such notice.
For purposes of the agreement, “cause” means any event, act or failure to act, or omission by Mr. Elliott which would constitute at law in the Province of Ontario cause for dismissal, including without limitation (i) conduct involving theft or misappropriation of our assets and those of our affiliates, (ii) fraud, embezzlement or an indictable offense under the Canadian Criminal Code, (iii) any material act of dishonesty, financial or otherwise, against us and our affiliates, (iv) intentional violations of law involving moral turpitude, (v) any material violation of our Code of Conduct and ethics policies, (vi) breach of Mr. Elliott’s obligations under anynon-competition,non-solicitation or other similar agreement made with any of us and our affiliates, or (vii) the continued failure by Mr. Elliott to attempt in good faith to perform his duties after receiving a written notice and a demand to rectify such failure within 60 days.
The agreement includes perpetual confidentiality provisions, and anon-disparagement provision, as well as provisions relating to assignment of inventionsinventions. Each of the employment agreements andnon-competition Mr. Ossip’s restrictive covenant agreement include a non-disparagement provision.
CEO Pay Ratio
In accordance with the requirements set forth by Section 953(b) of the Dodd-Frank Wall Street Reform andnon-solicitation Consumer Protection Act, we are providing the following information about the ratio of the total annual compensation of our Chair and Chief Executive Officer and our former Co-Chief Executive Officer to the total annual compensation of our median employee. For Fiscal Year 2023, an estimate of the ratio of Mr. Ossip’s total annual compensation to that applyof our median employee’s total annual compensation is 197:1, and is based on Mr. Ossip’s total annual compensation of $13,591,865. For Ms. Turner, who left the organization in November 2023, an estimate of the ratio of her total annual compensation to that of the median employee is 193:1, and is based on Ms. Turner's total annual compensation of $13,316,374, through her departure in November 2023. The “total compensation” figures for Mr. Ossip and Ms. Turner reflect the aggregate grant date fair value of stock awards granted to them during Fiscal Year 2023, which may not necessarily reflect the actual value, if any, that they realize from such awards. For example, because Ms. Turner forfeited all of her 2023 stock awards upon her resignation in November 2023, she realized no value from these awards. The total annual compensation of our median employee for Fiscal Year 2023 of $69,111.
We believe this ratio is a reasonable estimate, calculated in a manner consistent with SEC rules, based on our payroll and employment records and two years thereafter.the methodology described below. The median employee used for the Fiscal Year 2023 analysis is a Software Developer who works in Canada.
Since there have been no significant changes to our employee population or employee compensation programs during Fiscal Year 2023 that would affect our pay ratio disclosure, we used the same median employee disclosed in last year's Proxy Statement, as permitted by SEC rules. In determining that it was still appropriate to utilize our 2022 fiscal year's median employee for Fiscal Year 2023, we considered that there were no material changes to that employee’s job description or compensation structure during Fiscal Year 2023.
As disclosed in our 2023 Proxy Statement, our determination of which employee was the median employee was based on compensation data for the active global workforce as of October 1, 2022 (the “Determination Date”), which consisted of 8,430workers (excluding Mr. Ossip and Ms. Turner), inclusive of full-time, part-time, and temporary workers. We ranked the relevant global workforce based on annual earnings, which included the following elements for the 12-month period preceding the Determination Date:
The SEC rules for identifying the median employee and calculating the pay ratio based on the employees’ annual total compensation allows companies to adopt a variety of methodologies and to make reasonable estimates and assumptions that reflect their compensation practices. We believe our methodology provides reasonable estimates
| 50 | 2024 PROXY STATEMENT |
calculated in a method consistent with the pay ratio disclosure requirements. Pay ratio reported by other companies may not be comparable to the pay ratio as reported above as other companies may have different compensation practices and utilize alternative estimates, exclusions, assumptions, and methodologies based on their own unique circumstances.
Pay Versus Performance
As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(v) of Regulation S-K, we are providing the following information about the relationship between executive compensation actually paid and certain financial performance of our Company.
Year | Summary Compensation Table Total for PEO ($)(1)(3) | Summary Compensation Table Total for PEO #2 ($)(2)(3) | Compensation Actually Paid to PEO ($)(1)(3) | Compensation Actually Paid to PEO #2 ($)(2)(3) | Average Summary Compensation Table Total for Non-PEO Named Executive Officers ($)(3)(4) | Average Compensation Actually Paid to Non-PEO Named Executive Officers ($)(3)(4) | Value of Initial Fixed $100 Investment Based On: | Net Income ($mm) | Cloud Revenue ($mm)(6) | |
Total Shareholder Return ($) | Peer Group Total Shareholder Return ($)(5) | |||||||||
2023 | $13,591,865 | $13,316,374 | $12,808,746 | $1,958,141 | $5,494,164 | $4,914,594 | $103 | $187 | $55 | $1,408 |
2022 | $10,551,606 | $10,553,341 | -$98,989,543 | -$5,002,373 | $4,619,071 | $551,052 | $95 | $114 | -$78 | $1,016 |
2021 | $10,626,701 | -- | $174,858 | -- | $3,955,839 | $5,173,330 | $154 | $175 | -$75 | $804 |
2020 | $32,998,933 | -- | $171,576,972 | -- | $3,260,400 | $10,998,682 | $157 | $148 | -$4 | $729 |
In August 2018, we entered into an employment agreement
| 51 | 2024 PROXY STATEMENT |
To calculate “compensation actually paid” for David D. Ossip and Leagh E. Turner, and other NEOs, the following adjustments were made to the Summary Compensation Table total pay. The 2022 amounts in the tables below differ from those published in our President. 2023 Proxy Statement. These differences are the result of changes to the underlying inputs and assumptions, aligned with SEC rules.
Deductions and Additions to Summary Compensation Table Totals
Year | Summary Compensation Table Total ($) | Deductions from Summary Compensation Table Total Pay ($)(1) | Additions To Summary Compensation Table Total Pay ($) | Compensation Actually Paid ($) |
David D. Ossip, Co-Chief Executive Officer serving as PEO | ||||
2023 | $13,591,865 | -$12,439,889 | $11,656,770 | $12,808,746 |
2022 | $10,551,606 | -$9,399,991 | -$100,141,158 | -$98,989,543 |
2021 | $10,626,701 | -$9,399,974 | -$1,051,869 | $174,858 |
2020 | $32,998,933 | -$31,689,911 | $170,267,950 | $171,576,972 |
Leagh E. Turner,(2) Co-Chief Executive Officer serving as PEO #2 | ||||
2023 | $13,316,374 | -$12,439,889 | $1,081,656 | $1,958,141 |
2022 | $10,553,341 | -$9,399,991 | -$6,155,723 | -$5,002,373 |
Average for other Named Executive Officers indicated above | ||||
2023 | $5,494,164 | -$4,674,218 | $4,094,647 | $4,914,594 |
2022 | $4,619,071 | -$3,809,042 | -$258,977 | $551,052 |
2021 | $3,955,839 | -$3,042,685 | $4,260,176 | $5,173,330 |
2020 | $3,260,400 | -$2,522,139 | $10,260,421 | $10,998,682 |
Additions to Summary Compensation Table
David D. Ossip, Co-Chief Executive Officer serving as PEO | |||||||
Year | YE Value of Current Year Awards Outstanding as of YE | + | Change in Value as of YE for Prior Year Awards Outstanding as of YE | + | Change in Value as of Vesting Date for Prior Year Awards That Vested During the Year | = | Value of Equity for CAP Purposes |
2023 | $10,664,741 | + | $2,713,896 | + | -$1,721,867 | = | $11,656,770 |
2022 | $7,772,346 | + | -$73,518,436 | + | -$34,395,068 | = | -$100,141,158 |
2021 | $15,503,397 | + | $7,211,679 | + | -$23,766,945 | = | -$1,051,869 |
2020(1) | $104,843,073 | + | $87,875,480 | + | -$22,450,603 | = | $170,267,950 |
Leagh E. Turner,(2) Co-Chief Executive Officer serving as PEO #2 | |||||||
2023 | $0 | + | $533,086 | + | $548,570 | = | $1,081,656 |
2022 | $7,772,346 | + | -$7,735,255 | + | -$6,192,814 | = | -$6,155,723 |
Average for other Named Executive Officers indicated above | |||||||
2023 | $3,786,358 | + | $104,136 | + | $204,153 | = | $4,094,647 |
2022 | $3,204,538 | + | -$1,920,435 | + | -$1,543,080 | = | -$258,977 |
2021 | $4,315,723 | + | $209,263 | + | -$264,809 | = | $4,260,176 |
2020(1) | $5,292,803 | + | $4,912,369 | + | $55,249 | = | $10,260,421 |
| 52 | 2024 PROXY STATEMENT |
The agreement provides forequity awards included above are comprised of performance share units, restricted share units, and stock options granted from 2016 through 2022. The following assumptions underpin the fair value calculations.
Compensation Actually Paid Versus Company Performance
The following graphs show the compensation actually paid to Mr. Ossip and Ms. Turner, and the average amount of compensation actually paid to our NEOs as a group (excluding our PEOs) during the periods presented.
Compensation Actually Paid and Cumulative TSR
Compensation Actually Paid and Net Income
| 53 | 2024 PROXY STATEMENT |
Compensation Actually Paid and Cloud Revenue
Tabular List of Company Performance Measures
The following table alphabetically lists the financial performance measures we believe are most important in linking compensation actually paid to the Company’s NEOs to the Company’s performance during 2023.
Further details on these measures and how they feature in our compensation plans can be found in our CD&A.
| 54 | 2024 PROXY STATEMENT |
PROPOSAL TWO Advisory Vote on the Compensation of Dayforce’s Named Executive Officers |
We are asking our stockholders to approve, on an indefinite termadvisory basis, the compensation of Dayforce’s NEOs as disclosed in the CD&A, the accompanying compensation tables, and the related narrative disclosure beginning on September 4, 2018. page 24 of this Proxy Statement, pursuant to the following resolution:
RESOLVED, that the Company’s stockholders approve, on an advisory basis, the compensation of the Named Executive Officers, as disclosed in the Company’s Proxy Statement for the 2024 Annual Meeting of Stockholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion & Analysis, the accompanying compensation tables, and the related narrative disclosure.
The agreement providesBoard recommends a vote “FOR” this resolution because it believes that Ms. Turner will receive an annualized base salarythe policies and practices described in the CD&A are effective in achieving the Company’s goals of $655,000 USD,linking pay to executive performance and levels of responsibility, encouraging our executive officers to remain focused on both short-term and long-term financial and strategic goals of the Company, and linking executive performance to the creation of stockholder value as reflected in the “Executive Summary” of the CD&A section above.
Recommendation of the Board:
THE BOARD RECOMMENDS THAT YOU VOTE “FOR” THE APPROVAL OF NEO COMPENSATION. |
|
| 55 | 2024 PROXY STATEMENT |
PROPOSAL THREE Ratification of the Appointment of KPMG LLP as our Independent |
Our Audit Committee is directly responsible for the appointment, compensation, retention, and oversight of our independent registered public accounting firm, and is involved in the selection of the firm’s lead engagement partner who is subject to annual compensation reviewsa mandatory, regular rotation and who may provide services to our Company for a maximum of five consecutive years.
In selecting and approving a lead engagement partner, the Audit Committee relies on relevant succession criteria established by management and the Audit Committee, interactions with prospective candidates, assessments of their professional experience, and input from our Board.Company’s independent registered public accounting firm. The agreementAudit Committee also provides that Ms. Turner is eligible to receiveengages in an annual performance-based cash bonus with a target amountevaluation of 60%the independent registered public accounting firm. It considers, in particular, whether the retention of her annual base salary. Pursuant to the agreement, she received a signing bonus of $200,000 USD on September 14, 2018, and a bonus of $393,000 USD since she was an employee on December 31, 2018. Also, Ms. Turner will receive additional considerationfirm is in the formbest interests of (i) up to $30,000 USDour Company and its stockholders, taking into account the firm’s quality of service, the firm’s institutional knowledge and experience, our Company’s global operations and businesses, the firm’s sufficiency of resources, the quality of the communication and interaction with the firm, and the firm’s independence, objectivity, and professional skepticism. The Audit Committee also considers the advisability and potential impact of selecting a different independent registered public accounting firm.
After assessing the qualifications, performance, and independence of KPMG LLP (“KPMG”), which has served as our, or our predecessor’s, independent registered public accounting firm since 1958, the Audit Committee concluded that retaining KPMG as our independent registered public accounting firm for the services of an executive coach of her choosing, and (ii) up to $20,000 USD for the cost of attending the Institute of Corporate Directors—Director Education Program (through the Rotman School of Management).
In addition to the above, Ms. Turner participatesfiscal year 2024 is in the employee health and welfare, retirement and other employee benefits programs offered generally from timebest interests of Dayforce. Therefore, the Audit Committee has appointed KPMG as our independent registered public accounting firm to time by us to our senior executive employees.
Either we or Ms. Turner may terminateaudit the agreement any time with 90 days’ prior written notice. We may terminate Ms. Turner’s employment for death, “disability,” or with or without “cause” by written notice to Ms. Turner.
Ms. Turner’s employment agreement also provides that if her employment is terminated without cause, she will receive a lump sum cash payment equal to (i) 18 monthsconsolidated financial statements of total compensation (base salary plus incentive payment at target) if the termination occurs on or before the seventh anniversary of her start date, or (ii) 24 months of total compensation if the termination occurs after the seventh anniversary of her start date. Further, Ms. Turner will also receive apro-rated portion of the variable incentive plan payment that she would have been entitled to receiveDayforce for the fiscal year ending December 31, 2024.
Although it is not required to do so, our Board is asking our stockholders to ratify KPMG’s appointment. If our stockholders do not ratify KPMG’s appointment, the Audit Committee will consider changing our independent registered public accounting firm for 2024. Whether or not stockholders ratify KPMG’s appointment, the Audit Committee may appoint a different independent registered public accounting firm at any time if it determines that such a change is appropriate. KPMG has advised the Audit Committee that it is an independent accounting firm with respect to Dayforce and its affiliates in which her termination occurs had she remained an employee of Ceridian Canada, executive outplacement service for a period of up to 12 months following termination in an amount not to exceed $10,000 USD, and continuation of healthcare coverage based on her termination date for up to 18 to 24 months following her termination of employment.
Further, Ms. Turner’s employment agreement provides that if her employment is terminated due to death or Disability (as such term is defined in her employment agreement), that she would receive apro-rated portionaccordance with the requirements of the variable incentive plan payment that she wouldSEC and the Public Company Accounting Oversight Board (“PCAOB”). Representatives of KPMG are expected to be present at our Annual Meeting, will have been entitledan opportunity to receivemake a statement if they choose, and are expected to be available to respond to appropriate stockholder questions.
Audit Fees
The following table sets forth the fees billed or expected to be billed by KPMG for audit, audit-related, tax, and all other services rendered for Fiscal Years 2023 and 2022:
| 2023 |
| 2022 |
|
| ||||
Fee Category | (In thousands) | ||||||||
Audit Fees |
| $ | 2,786 |
|
| $ | 2,292 |
|
|
Audit-Related Fees |
|
| 1,842 |
|
|
| 1,642 |
|
|
Tax Fees |
|
| 32 |
|
|
| 55 |
|
|
All Other Fees |
|
| — |
|
|
| — |
|
|
Total Fees |
| $ | 4,660 |
|
| $ | 3,989 |
|
|
Audit Fees. Consist of fees for services rendered for the fiscal year in which her death audit and/or Disability occurs had she remained continuously employed for the full fiscal year.
For purposes of her employment agreement, “cause” means (i) conduct involving theft or misappropriationreview of our assetsconsolidated financial statements. Audit fees also include fees for services rendered in connection with the filing of registration statements and thoseother documents with the SEC, and the issuance of accountant consents and comfort letters.
| 56 | 2024 PROXY STATEMENT |
Audit-Related Fees. Consist of aggregate fees for accounting consultations and other services that were reasonably related to the performance of audits or reviews of our affiliates, (ii) fraud, embezzlement or an indictable offense, (iii) any material actconsolidated financial statements and were not reported above under “Audit Fees.”
Tax Fees. Consist of dishonesty,aggregate fees for tax compliance, tax advice, and tax planning services, including the review and preparation of certain foreign income tax returns.
All Other Fees. Consist of fees billed in the indicated year for other permissible work performed by KPMG that is not included within the above category descriptions.
Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm
We have adopted a policy under which the Audit Committee must pre-approve all audit and permissible non-audit services to be provided by the independent registered public accounting firm. As part of its review, the Audit Committee also considers whether the categories of pre-approved services are consistent with the rules on independence. The Audit Committee pre-approved all services performed by KPMG in Fiscal Year 2023.
Recommendation of the Board
THE BOARD RECOMMENDS THAT YOU VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF KPMG LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING DECEMBER 31, 2024. |
|
Report of the Audit Committee of the Board of Directors
The Audit Committee’s general role is to assist the Board in monitoring our financial or otherwise, against usreporting process and related matters. Its specific responsibilities are set forth in its charter.
The Audit Committee has reviewed our affiliates, (iv) intentional violation of law involving moral turpitude, (v) any material violation of our Code of Conductaudited consolidated financial statements for Fiscal Year 2023 and ethics policies, (vi) breach of Ms. Turner’s obligations under anynon-competition,non-solicitation, or other similar agreement mademet with any of us and our affiliates, or (vii) the continued failure by Ms. Turner to attempt in good faith to perform her duties after receiving a written notice and a demand to rectify such failure within 90 days.
The agreement includes perpetual confidentiality provisions and anon-disparagement provision,management, as well as provisions relatingwith representatives of KPMG, our independent registered public accounting firm, to assignmentdiscuss the audited consolidated financial statements. The Audit Committee also discussed with members of inventionsKPMG the matters required to be discussed by the applicable requirements of the PCAOB andnon-competition andnon-solicitation. the SEC.
Potential Payments Upon Termination Of Employment Or Change Of Control
Our NEOs are entitled to receive severance payments upon termination of employment, or a termination of employment in connection with a change of control as provided in “—Employment and Separation Agreements.” In addition, certain equity awards may be accelerated upon a change of control, as further described in “—Outstanding Equity Awards as of December 31, 2018”.
Director Compensation
We pay our independentnon-employee directors, who are not employees of our Sponsors, an annual retention fee of $200,000. The annual retention fee is comprised of restricted stock units valued at $150,000the Audit Committee received the written disclosures and $50,000 in cash, which the independentnon-employee director may also elect to be paid in whole or in part in the form of additional restricted stock units. The chairletter from KPMG required by applicable requirements of the audit committee receives an additional annual cash feePCAOB regarding the independent accountant’s communications with the Audit Committee concerning independence and discussed with members of $20,000,KPMG its independence.
Based on these discussions, the chair of the compensation committee receives an additional annual cash fee of $12,500, and the chair of the corporate governance and nominating committee receives an additional annual cash fee of $7,500, unless they are employees of our Sponsors, in which case they do not receive such compensation. Any cash fees are paid in quarterly installments. In addition, all of our independentnon-employee directors may be reimbursed for approved director education courses. Directors may also be reimbursed for reasonableout-of-pocket travel expenses incurred in connection with attendance at Board and committee meetingsfinancial statement review, and other Board-related activities.
The following table presentsmatters it deemed relevant, the total compensation for each person who served as a member of ourAudit Committee recommended to the Board during 2018, other than Mr. Ossip. Mr. Ossip received no additional compensation for his service as a member of our Board during 2018.
Director Compensationthat Dayforce’s audited consolidated financial statements for Fiscal Year 20182023 be included in its Annual Report on Form 10-K for fiscal year ended December 31, 2023.
Audit Committee
Name | Fees Earned or Paid in Cash ($)(1)(2) | Stock Awards ($)(1)(2) | Total ($)(3) | |||||||||
Brent B. Bickett | — | — | — | |||||||||
Ronald F. Clarke | — | $ | 200,000 | $ | 200,000 | |||||||
William P. Foley, II | — | — | — | |||||||||
Thomas M. Hagerty | — | — | — | |||||||||
Soren L. Oberg | — | — | — | |||||||||
Ganesh B. Rao | — | — | — | |||||||||
Andrea S. Rosen | — | $ | 200,000 | $ | 200,000 | |||||||
Gerald C. Throop | $ | 30,784 | $ | 175,000 | $ | 205,784 |
Gerald C. Throop, Chair
Deborah A. Farrington
Linda P. Mantia
Andrea S. Rosen
| 57 | 2024 PROXY STATEMENT |
EQUITY COMPENSATION PLAN INFORMATION |
|
|
EQUITY COMPENSATION PLAN INFORMATION
The table below presents information as of December 31, 20182023, for our equity compensation plans approved by our stockholders. We do not have any equity compensation plans that have not been approved by our stockholders. We are submitting
Plan Category | Number of shares of |
| Weighted-average |
| Number of shares of |
| ||||||||||||
Equity compensation plans approved by stockholders |
|
| 11,990,734 |
| (1) |
|
| $ | 53.28 |
| (2) |
|
|
| 13,590,783 |
| (3) |
|
Equity compensation plans not approved by stockholders |
|
| — |
|
|
|
|
| — |
|
|
|
|
| — |
|
|
|
Total |
|
| 11,990,734 |
| (1) |
|
| $ | 53.28 |
| (2) |
|
|
| 13,590,783 |
| (3) |
|
Equity Compensation Plan Information
Global Employee Stock Purchase Plan at this Annual Meeting.
Plan Category | Number of shares of common stock to be issued upon exercise of outstanding options, warrants and rights | Weighted-average exercise price of outstanding options, warrants and rights | Number of shares of common stock remaining available for future issuance under equity compensation plans (excluding shares reflected in column (a)) | |||||||||
(a) | (b) | (c) | ||||||||||
Equity compensation plans approved by stockholders | 14,580,219 | $ | 19.12 | (1) | 10,781,685 | (2) | ||||||
Equity compensation plans not approved by stockholders | — | — | — | |||||||||
|
|
|
|
|
| |||||||
Total | 14,580,219 | $ | 19.12 | 10,781,685 |
|
|
Equity Compensation Plan Information
Global Employee Stock Purchase Plan
As discussed above, our stockholders are being asked to consider and act upon a proposal to approve the Ceridian HCM Holding Inc. Global Employee Stock Purchase Plan (the “GESPP”). The GESPP was approved unanimously and adopted by the Board at its meeting on November 9, 2018, at which time it became effective, subject to approval by our stockholders. The material terms of the GESPP are discussed above under Proposal 2—approval of the Ceridian HCM Holding Inc. Global Employee Stock Purchase Plan.
Equity Incentive Plans
Our Board adopted, and our stockholders approved, the GESPP. The GESPP authorizes the issuance of up to 2,500,000 shares of Common Stock to eligible participants through purchases via payroll deductions. The purchase price is the lower of (i) 85% of the fair market value of a share of Common Stock on the offering date (the first trading day of the offering period commencing on January 1 and concluding on December 31), or (ii) 85% of the fair market value of a share of Common Stock on the purchase date. The GESPP continues for ten years, unless terminated sooner as provided under the GESPP. A total of 1,415,089 shares remain available for issuance under the GESPP as of December 31, 2023.
Equity Incentive Plans
Our Board adopted, and our stockholders approved, the 2018 EIP, as amended, and the 2013 Ceridian HCM HoldingDayforce, Inc. Stock Incentive Plan (as amended, the(the “2013 Plan”), and the Ceridian HCM Holding Inc. 2018 Equity Incentive Plan (the “2018 Plan”). The following is a summary of the material features of the 2018 PlanEIP and the 2013 Plan.
2018 EIP. The 2018 EIP was adopted by our Board and approved by our stockholders in connection with our initial public offering. The 2018 EIP authorizes us to grant incentive awards to our employees, directors, and consultants. AAs of December 31, 2023, there are approximately 8,340 individuals (including all of our executive officers and non-employee directors) who are eligible to participate in the 2018 EIP on the basis of their services provided to us. As of December 31, 2023, a total of 13,500,00030,794,332 shares of our Common Stock are reservedwere approved for issuance and a total of 11,350,886 shares of our Common Stock were subject to outstanding awards under the 2018 EIP.
In 2022, our Board approved an amendment to the 2018 EIP to remove the 3% “evergreen” refresh provision that permits annual refreshment of the equity pool available for issuance under the 2018 Plan. We filed a registration statement onForm S-8 covering the shares issuable under the 2013 Plan and the 2018 Plan on April 25, 2018. The following is a summary of the material features of the 2013 Plan and the 2018 Plan.EIP.
| 58 | 2024 PROXY STATEMENT |
2013 Plan.The 2013 Plan providesprovided for the grant of options, share awards, and other share-based awards to our directors, employees, and consultants as well as to directors, employees, and consultants of any of our subsidiaries or affiliates. A total of 9,356,904639,848 shares of our Common Stock are subject to outstanding awards under the 2013 Plan as of December 31, 2018.2023. We do not intend to grant any further awards under the 2013 Plan.
2018 Plan.The 2018 Plan was adopted by our Board and approved by our stockholders in connection with our initial public offering. The purpose
| 59 | 2024 PROXY STATEMENT |
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT |
Beneficial Ownership of the 2018 Plan is to further align the interests of eligible participants with those of our stockholders by providing long-term incentive compensation opportunities tied to both our performance and that of our Common Stock. The 2018 Plan is intended to advance our interests and to increase stockholder value by attracting, retaining, and motivating key personnel upon whose judgment, initiative, and
effort the successful conduct of our business is largely dependent. Our Board and management believe that equity awards are necessary to remain competitive in our industry and are essential to recruiting and retaining the highly qualified employees who help us meet our goals.
Any officer, employee,non-employee director, consultant or any natural person who is a consultant or advisor of ours or of any of our subsidiaries is eligible to receive Awards (as defined below) under the 2018 Plan. The selection of participants is within the sole discretion of the Committee (as defined below). Incentive stock options may be granted only to our employees and employees of certain of our subsidiaries. As of the date of this Proxy Statement, there are approximately 4,531 employees (including 8 officers and 7non-employee directors) who are eligible to participate in the 2018 Plan on the basis of their services provided to us.
The 2018 Plan is administered by the compensation committee of our Board, such other committee of the Board appointed by our Board to administer the 2018 Plan, or the Board, as determined by our Board (in each case, the “Committee”).
A total of 13,500,000 shares of our Common Stock are reserved for issuance under the 2018 Plan (the “Share Reserve”), and a total of 5,218,315 shares of our Common Stock are subject to outstanding awards under the 2018 Plan as of December 31, 2018. The 2018 Plan permits the grant of (a) nonqualified stock options, (b) incentive stock options, (c) stock appreciation rights, (d) restricted stock awards, (e) restricted stock units, (f) cash incentive awards, and (g) stock awards (collectively, “Awards”). Awards may be granted singly or in combination. The Share Reserve will be increased on March 31 of each of the first ten calendar years during the term of the Plan, by the lesser of (i) three percent (3%) of the number of shares of our Common Stock outstanding on each January 31 immediately prior to the date of increase or (ii) such number of shares of our Common Stock determined by the Board or Committee. As of March 31, 2019, the Share Reserve will increase by three percent (3%) of the number of shares of the Company’s Common Stock outstanding on January 31, 2019 or 4,196,193 shares.
Nonon-employee director may be granted, during any calendar year, Awards having a fair value (determined on the date of grant) that, when added to all other compensation paid to thenon-employee director during the same calendar year for service as a member of our Board, exceeds $600,000, or for thenon-executive chairman of the Board, if any, $750,000.
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table shows information as of March 4, 2019the Record Date regarding the beneficial ownership of our Common Stock by:
•
•
•
Beneficial ownership of shares is determined under rules of the SEC and generally includes any shares over which a person exercises sole or shared voting or investment power. Except as noted by footnote, and subject to community property laws where applicable, we believe based on the information provided to us that the persons and entities named in the table below have sole voting and investment power with respect to all shares of our Common Stock shown as beneficially owned by them. PercentageThe percentage of beneficial ownership is based on 140,534,254157,516,347 shares of Common Stock outstanding as of March 4, 2019.the Record Date. Shares of Common Stock (i) issued or issuable upon exchange of the Exchangeable Shares, and (ii) subject to stock options currently exercisable or exercisable within 60 days of the dateRecord Date, and (iii) that are issuable pursuant to equity awards that are currently vested or will vest within 60 days of this Proxy StatementRecord Date are deemed to be outstanding and beneficially owned by the person holding the Exchangeable Shares, stock options, or optionsequity awards for the purposes of computing the percentage of beneficial ownership of that person and any group of which that person is a member, but are not deemed outstanding for the purpose of computing the percentage of beneficial ownership for any other person. Unless otherwise indicated, the address for each stockholder listed below is c/o Ceridian HCM HoldingDayforce, Inc., 3311 East Old Shakopee Road, Minneapolis, Minnesota 55425.
Name and address of beneficial owner | Number of Shares | Percent of Total | ||||||
5% Stockholders: | ||||||||
Affiliates of Thomas H. Lee Partners, L.P. (1) | 61,456,833 | 43.7 | % | |||||
Cannae Holdings, Inc. (2) | 32,739,227 | 23.3 | % | |||||
Named executive officers and directors: | ||||||||
David D. Ossip (3) | 5,338,556 | 3.7 | % | |||||
Paul D. Elliott (4) | 130,685 | * | ||||||
Leagh E. Turner | — | * | ||||||
Brent B. Bickett (5) | 32,826,601 | 23.4 | % | |||||
Ronald F. Clarke | — | * | ||||||
William P. Foley, II (6) | 32,850,695 | 23.4 | % | |||||
Thomas M. Hagerty | — | * | ||||||
Ganesh B. Rao | — | * | ||||||
Andrea S. Rosen | — | * | ||||||
Gerald C. Throop (7) | 34,572 | * | ||||||
All current directors and executive officers as a group (15 persons) (3), (4), (5), (6), (7), (8) | 38,861,235 | 26.9 | % |
Name and address of beneficial owner | Number of | Percent of | ||||||||
5% Stockholders: |
|
|
|
|
|
|
|
| ||
T. Rowe Price Associates, Inc.(1) |
|
| 19,316,449 |
|
|
|
| 12.3 | % |
|
The Vanguard Group(2) |
|
| 16,822,824 |
|
|
|
| 10.7 | % |
|
Capital International Investors(3) |
|
| 16,396,559 |
|
|
|
| 10.4 | % |
|
Select Equity Group, L.P. and George S. Loening(4) |
|
| 15,010,967 |
|
|
|
| 9.5 | % |
|
Capital Research Global Investors, a division of Capital Research and Management Company(5) |
|
| 14,183,214 |
|
|
|
| 9.0 | % |
|
BlackRock, Inc.(6) |
|
| 10,898,820 |
|
|
|
| 6.9 | % |
|
|
|
|
|
|
|
|
|
| ||
NEOs and Directors: |
|
|
|
|
|
|
|
| ||
Samer Alkharrat(7) |
|
| 242 |
|
|
| * |
|
| |
Christopher R. Armstrong(8) |
|
| 235,716 |
|
|
| * |
|
| |
Brent B. Bickett(9) |
|
| 113,912 |
|
|
| * |
|
| |
Ronald F. Clarke(10) |
|
| 35,792 |
|
|
| * |
|
| |
Deborah A. Farrington(11) |
|
| 24,704 |
|
|
| * |
|
| |
Thomas M. Hagerty(12) |
|
| 204,638 |
|
|
| * |
|
| |
Noémie C. Heuland(13) |
|
| 45,383 |
|
|
| * |
|
| |
Stephen H. Holdridge(14) |
|
| 110,421 |
|
|
| * |
|
| |
Linda P. Mantia(15) |
|
| 26,195 |
|
|
| * |
|
| |
David D. Ossip(16) |
|
| 6,600,359 |
|
|
|
| 4.2 | % |
|
Ganesh B. Rao(17) |
|
| 51,997 |
|
|
| * |
|
| |
Andrea S. Rosen(18) |
|
| 42,334 |
|
|
| * |
|
| |
Gerald C. Throop(19) |
|
| 85,147 |
|
|
| * |
|
| |
Leagh E. Turner(20) |
|
| 170,658 |
|
|
| * |
|
| |
All current directors and executive officers as a group (16 persons)(21) |
|
| 7,817,335 |
|
|
|
| 4.9 | % |
|
|
|
|
|
|
|
|
|
|
|
Section 16(a) Beneficial
Section 16(a)reported as of February 28, 2024.
| 61 | 2024 PROXY STATEMENT |
Beneficial Ownership of Preferred Stock
As of the Record Date, Dayforce has one share of special voting preferred stock outstanding, par value $0.01 per share (the “Reporting Persons”“Special Voting Share”). The trustee who holds the Special Voting Share (the “Trustee”) holds legal title to filethe Special Voting Share for the use and benefit of the registered holders of Exchangeable Shares.
In connection with the SEC initial reports of beneficial ownershipVoting and reports of changes in beneficial ownership. The Reporting Persons are required by SEC regulations to furnish us with copies of all such reports.
Based solely on our review ofExchange Trust Agreement dated April 25, 2018, among the copies of any Section 16(a) forms received by us or written representations fromCompany, Dayforce Canada Ltd. (f/k/a Ceridian Canada Ltd.), Ceridian AcquisitionCo ULC, and the Reporting Persons, we believe thatTrustee, the Trustee is entitled, with respect to any matter, question, proposal, or proposition whatsoever that may properly come before Dayforce’s Annual Meeting and with respect to all written consents sought from the fiscal year ended December 31, 2018, all Reporting Persons compliedholders of Dayforce’s Common Stock, to cast the number of votes for each Exchangeable Share equal to the number of shares of Common Stock issuable upon the exchange of each Exchangeable Share held by registered holders of such Exchangeable Shares on the Record Date and for which the Trustee has received voting instructions from such holders.
Except as specifically authorized, the Trustee has no power or authority to sell, transfer, vote, or otherwise deal in or with all applicable filing requirements.the Special Voting Share. The Trustee is not entitled to receive any portion of any dividend or distribution at any time. Upon any liquidation, dissolution, or winding up of Dayforce, the Trustee will not be entitled to any portion of any related distribution.
At such time as (i) there are no Exchangeable Shares of Ceridian AcquisitionCo ULC issued and outstanding that are not owned by Dayforce or any subsidiary of Dayforce; and (ii) there is no share of stock, debt, option, or other agreement, obligation, or commitment of Ceridian AcquisitionCo ULC which could by its terms require Ceridian AcquisitionCo ULC to issue any Exchangeable Shares to any person other than Dayforce or any subsidiary of Dayforce, then the Special Voting Share will be retired and cancelled promptly for no consideration and will not be reissued.
The Special Voting Share is held by Barbara Ferreri. The address for Barbara Ferreri is c/o Corporate Secretary, Dayforce, Inc., 3311 East Old Shakopee Road, Minneapolis, Minnesota 55425.
| 62 | 2024 PROXY STATEMENT |
Set forth below is a description of certain relationships and related person transactions between us or ourDayforce, its subsidiaries, and our directors, executive officers, or holders of more than 5% of our voting securities.
Registration Rights Agreement
On April 30, 2018, in connection with our initial public offering, we entered into a registration rights agreement with the Sponsors,THL, Cannae, David D. Ossip, Alon Ossip the(the brother of David D. Ossip,Ossip), and entities controlled by each of David D. Ossip and Alon Ossip in respect of the shares of Common Stock and Exchangeable Shares held by such holder immediately following the initial public offering. This agreement provides these holders (and their permitted transferees) with the right to require us, at our expense, to register shares of our Common Stock that they hold. The agreement also provides that we will pay certain expenses of these electing holders relating to such registrations and indemnify them against certain liabilities that may arise under the Securities Act of 1933, as amended.amended ("Securities Act").
On April 30, 2018,Our Board has adopted a written Related Person Transactions Policy to assist us in connectioncomplying with our initial public offering, we entered intoSEC and NYSE rules and regulations related to related person transactions. A “related person transaction” is any transaction, arrangement or relationship, or any series of similar transactions, arrangements, or relationships, in which (i) Dayforce or any of its subsidiaries is or will be a voting agreement withparticipant; and (ii) any related person (as defined in Item 404 of Regulation S-K) has or will have a direct or indirect material interest. The Audit Committee is responsible for administering the Sponsors, pursuant topolicy, which we are required to takeincludes reviewing all necessary action to cause the Board to include individuals designated by the Sponsors. These designation rights are described in this Proxy Statement in the section titled “Board of Directors and Corporate Governance—Board Membership.” The voting agreement also requires the Sponsors to consult with one another regarding the transfer of their equity securities in us.
Management Agreements
Prior to our initial public offering, Ceridian was party to management agreements with affiliates of our Sponsors, FNF and THL Managers VI, LLC (“THLM”). FNF assigned its management agreement to Cannae in November 2017. Pursuant to these management agreements, Cannae and THLM each, respectively, agreed to provide us with financial advisory, strategic, and general oversight services.
In April 2018, the management agreements terminated upon consummation of our initial public offering. Upon termination and pursuant to the terms of the management agreements, we paid a termination fee equal torelevant facts and circumstances of all related person transactions that require the net present valueAudit Committee’s approval before entry into the transaction. Under the policy, the Audit Committee must either approve or disapprove of the management fee for a seven-year period, which was $11.3 million.
We recorded a management fee expenseentry into the related person transaction in selling, general,accordance with all applicable SEC and administrative expenseNYSE rules and regulations, including Item 404 of $12.0 million, for the year ended December 31, 2018 related to these management agreements.
Indebtedness
Prior to its November 2017split-off from FNF, Cannae was an affiliate of FNF. We redeemed $24.0 million of our previously-outstanding $475.0 million principal amount senior notes due 2021 (the “Senior Notes”) from FNFRegulation S-K and its subsidiaries on May 30, 2018. We had previously made $1.3 million in interest payments to FNF and its subsidiaries during the year ended December 31, 2018. FNF and its subsidiaries conducted the debt transactions through third parties in the ordinary course of their business and not directly with us. Following Cannae’ssplit-off from FNF, FNF retained ownershipSection 314.00 of the Senior Notes.NYSE Listed Company Manual.
| 63 | 2024 PROXY STATEMENT |
Service and Vendor Related Agreements
We are a party to a service agreement with CompuCom Systems, Inc. (“CompuCom”), an investment portfolio company of THLM. Pursuant to the service agreement, CompuCom agrees to provide us with service desk and desk side support services. Pursuant to this arrangement, we made payments to CompuCom totaling $1.8 million for the year ended December 31, 2018.
Other Transactions
On July 23, 2018, Ronald F. Clarke was appointed to our Board. Mr. Clarke has been the chief executive officer of FleetCor Technologies since August 2000 and chairman of its board of directors since March 2003. We provide services to FleetCor Technologies or one of its wholly owned affiliates through certain commercial arrangements entered into in the ordinary course of business, which include: provision of Dayforce HCM services; reseller / referral arrangements whereby we resell / refer FleetCor Technologies services to its customers; and other administrative services. For these services, we have recorded revenue of $2.3 million for the year ended December 31, 2018.
We provide Dayforce and related services to The Stronach Group, for which we recorded revenue of $0.3 million for the year ended December 31, 2018. Alon Ossip, the brother of David D. Ossip, was the chief executive officer, and is currently a minority shareholder, of The Stronach Group.
We provide Dayforce and payroll-related tax filing services to FNF, for which we recorded revenue of $0.4 million for the year ended December 31, 2018.
We provide Dayforce and related services to certain investment portfolio companies of THLM and Cannae. that are considered related parties. The revenue from these related parties was as follows:
Year Ended December 31, | ||||||||||||||
Counter-Party | Related Persons Interest | 2023 | 2022 | 2021 | ||||||||||
(In millions) | ||||||||||||||
FleetCor Technologies, Inc. | Shared board members. One board member is also the CEO and the chairman of the board of the counter-party | $ | 0.9 | $ | 0.8 | $ | 0.6 | |||||||
The Stronach Group | The brother of David D. Ossip, our Chair and CEO, was formerly the CEO, and is currently a minority shareholder | 0.1 | 0.1 | 0.1 | ||||||||||
Verve Senior Living | David D. Ossip, our Chair and CEO, and his brother are currently minority shareholders | 0.4 | 0.4 | 0.4 | ||||||||||
Environmental 360 Solutions | The brother of David D. Ossip, our Chair and CEO, is a board member | 0.5 | 0.2 | — | ||||||||||
Fidelity National Financial, Inc. | Shared board members | 0.4 | 0.4 | 0.4 | ||||||||||
Guaranteed Rate, Inc. | Portfolio company of THL, of which certain members of our board are managing directors | 1.7 | 1.7 | 1.7 | ||||||||||
HighTower Advisors, LLC | Portfolio company of THL, of which certain members of our board are managing directors. One board member also serves on the board of HT Holding, LLC, which is an affiliate of the counter-party | 0.4 | 0.4 | 0.3 | ||||||||||
Ten-X, LLC | Portfolio company of THL, of which certain members of our board are managing directors | 0.2 | 0.2 | 0.2 | ||||||||||
Smile Doctors | Portfolio company of THL, of which certain members of our board are managing directors | 1.1 | 1.0 | — | ||||||||||
The Dun & Bradstreet Corporation | Shared board members with Dun & Bradstreet Holdings, Inc., which owns the counter-party and is a portfolio company of THL | 1.8 | 1.8 | — |
We recorded revenue of $1.8 million from American Blue Ribbon Holdings, LLC; $0.5 million from Essex Bargain Hunt Superstores; $0.5 million from Guaranteed Rate; $0.3 million from Phillips Feed Services; and $0.3 million from System One Holdings LLC for the year ended December 31, 2018.are party to service agreements with certain companies that are considered related parties. Payments made to related parties were as follows:
Immediately subsequent to our initial public offering on April 30, 2018, THL / Cannae Investors LLC, one of our existing stockholders controlled by our Sponsors, purchased from us in a private placement $100.0 million of our Common Stock at a price per share equal to the initial public offering price. Based on the initial public offering price of $22.00 per share, 4,545,455 shares were issued in this private placement.
Year Ended December 31, | ||||||||||||||
Counter-Party | Related Persons Interest | 2023 | 2022 | 2021 | ||||||||||
(In millions) | ||||||||||||||
Manulife Financial | Shared board member | $ | 10.0 | $ | 6.0 | $ | 8.1 | |||||||
The Dun & Bradstreet Corporation | Shared board members with Dun & Bradstreet Holdings, Inc., which owns the counter-party and is a portfolio company of THL | 3.2 | 0.3 | 0.4 |
Policies for Approval of Related Person Transactions
| 64 | 2024 PROXY STATEMENT |
Our Board has adopted a Code of Conduct that contains a written policy relating to the approval of related person transactions. A “related person transaction” is a transaction or arrangement or series of transactions or arrangements in which we participate (whether or not we are a party) and a related person has a direct or indirect material interest in such transaction. Our audit committee reviews and approves or ratifies all relationships and related person transactions between us and (i) our directors, director nominees, or executive officers, (ii) any 5% record or beneficial owner of our Common Stock, or (iii) any immediate family member of any person specified in (i) and (ii) above. The audit committee reviews all related person transactions and, where the audit committee determines that such transactions are in our best interests, approves such transactions in advance of such transaction being given effect or ratified.
VOTING INFORMATION |
Time and Date | 10:00 a.m., Eastern Daylight Time, Friday, April 26, 2024 | |
Live Webcast | www.virtualshareholdermeeting.com/DAY2024 | |
Record Date | March 4, 2024 | |
Entitled to Vote | Holders of record of shares of our Common Stock, and the holder of the Special Voting Share (together with the Common Stock, the “Voting Stock”), at the close of business on the Record Date, will be entitled to notice of and to vote at the Annual Meeting. Each share of Common Stock is entitled to one vote on any matter presented to stockholders at the Annual Meeting. In addition, as described below under “How to Vote,” the holder of the Special Voting Share is entitled to vote on all matters on which a holder of our Common Stock is entitled to vote and is entitled to cast a number of votes equal to the number of shares of Common Stock issuable upon exchange of the Exchangeable Shares then outstanding. | |
Shares Outstanding | As of the Record Date, 155,562,427 shares of Common Stock were outstanding and the Special Voting Share represents an additional 1,953,920 shares of Common Stock issuable upon the exchange of the Exchangeable Shares, for a total of 157,516,347 votes represented by the outstanding shares of Voting Stock. The list of stockholders entitled to vote at the Annual Meeting shall be open to the examination of any stockholder, for any purpose germane to the Annual Meeting, during ordinary business hours, for a period of at least ten days ending on the day before the Annual Meeting date at the principal place of business (3311 East Old Shakopee Road, Minneapolis, Minnesota 55425). | |
Proxy Materials | On or about March 12, 2024, we mailed or made available to our stockholders the proxy materials, including our Proxy Statement, the 2023 Annual Report, and form of proxy or the Notice of Internet Availability. | |
How to Vote | There are four ways a stockholder of record can vote: (1) By internet at proxyvote.com up until 11:59 p.m. EDT on April 25, 2024 (have your proxy card in hand when you visit the website); (2) By toll-free telephone at 1-800-690-6903 up until 11:59 p.m. EDT on April 25, 2024 (have your proxy card in hand when you call); (3) By completing and mailing your proxy card; or (4) By electronic ballot at the Annual Meeting. In order to be counted, proxies submitted by telephone, internet, or U.S. mail must be received before the start of the Annual Meeting. If you hold your shares through a bank, broker, or other nominee, please follow the bank’s, broker’s, or other nominee’s instructions, as applicable. If you hold Exchangeable Shares, you are entitled to direct the Trustee to cast the number of votes equal to the number of shares of Common Stock issuable upon the exchange of the Exchangeable Shares you held on the Record Datevia one of the voting methods described above. The Trustee will vote pursuant to your voting instructions, which must be received prior to 5:00 p.m. EDT on April 24, 2024. Holders of Exchangeable Shares will receive a separate notice containing further details regarding voting instructions. |
| 65 | 2024 PROXY STATEMENT |
Admission | The Annual Meeting will be a virtual meeting conducted on the following website: www.virtualshareholdermeeting.com/DAY2024 Admission to the Annual Meeting is restricted to stockholders as of the close of business on the Record Date, valid proxy holders of such stockholders, and/or their designated representatives. To participate in the virtual meeting, you will need the 16-digit control number that is printed in the box marked by the arrow on your Notice of Internet Availability of Proxy Materials or your proxy card (if you received a printed copy of the proxy materials). If your shares are held in the name of a bank, brokerage firm, or other nominee, you should follow the instructions provided by them in order to participate in the virtual meeting. We recommend that you log in 15 minutes before the start of the Annual Meeting to ensure sufficient time to complete the check-in procedures. | |
Quorum | A majority of the shares of all issued and outstanding stock entitled to vote on the Record Date must be present at the Annual Meeting or represented by proxy to constitute a quorum. For purposes of determining whether a quorum is present, “all issued and outstanding stock entitled to vote” will include the number of shares of Common Stock issuable upon the exchange of the Exchangeable Shares. | |
Revoking Your Proxy | Stockholders of record may revoke their proxies by attending the Annual Meeting and voting, by submitting an instrument in writing revoking the proxy, by submitting another duly executed proxy bearing a later date to our Corporate Secretary before the vote is counted, or by voting again using the telephone or internet before the start of the Annual Meeting (your latest telephone or internet proxy is the one that will be counted). If you hold shares through a bank, broker, or other nominee, please contact that firm for instructions on how to revoke your prior voting instructions. | |
Votes Required to | Each share of Common Stock outstanding on the Record Date is entitled to one vote on any proposal presented to stockholders at the Annual Meeting, and the Trustee is entitled to vote on all matters that a holder of our Common Stock is entitled to vote on and is entitled to cast a number of votes equal to the number of shares of Common Stock issuable upon exchange of the Exchangeable Shares then outstanding. As of the Record Date, 155,562,427 shares of Common Stock were outstanding and the Special Voting Share represents an additional 1,953,920 shares of Common Stock issuable upon exchange of the Exchangeable Shares, for a total of 157,516,347 votes represented by the outstanding shares of Voting Stock. For Proposal One, our bylaws provide for a majority voting standard in uncontested elections of directors. Accordingly, directors shall be elected by a majority of votes cast at the Annual Meeting. This means that the number of votes cast “FOR” a director must exceed the number of votes cast “against” that director. If your broker holds your shares, your broker is not entitled to vote your shares on this proposal without your instruction. Note that if a nominee that is an incumbent director does not receive a required majority of the votes cast, the director must promptly tender their resignation to the Board. The Board will act on the recommendation of the Corporate Governance and Nominating Committee in deciding whether to accept or reject the resignation, and will publicly disclose its decision within ninety (90) days from the date of publication of the election results. For Proposal Two, regarding the advisory vote on the compensation of our Named Executive Officers, the proposal must receive “FOR” votes from the holders of a majority of the votes represented by the Voting Stock present at the Annual Meeting (in person or by proxy) and voting on the matter. If your broker holds your shares, your broker is not entitled to vote your shares on this proposal without your instruction. As the vote on this proposal is advisory in nature, it will not affect any compensation already paid or awarded to any NEO and will not be binding on or overrule any decisions by the Compensation Committee or the Board. However, because we value our stockholders’ view, the Compensation Committee and Board |
| 66 | 2024 PROXY STATEMENT |
will carefully consider the results of this advisory vote when formulating future executive compensation philosophy, policies, and practices. For Proposal Three, ratification of the appointment of KPMG LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2024, the proposal must receive “FOR” votes from the holders of at least a majority of the votes represented by the Voting Stock present at the Annual Meeting (in person or by proxy) and voting on the matter. Your broker or other nominee will have the discretion to vote your shares on this proposal without your instruction. | ||||||
Votes Required | Voting Choices | Effect of Abstentions | Effect of Broker Non-Votes | |||
Proposal One: Election of Directors Majority of votes represented by the Voting Stock present at the Annual Meeting (in person or by proxy) and voting on the matter | • For • Against • Abstain | No effect | No effect | |||
Proposal Two: Advisory vote on compensation of our Named Executive Officers Majority of votes represented by the Voting Stock present at the Annual Meeting (in person or by proxy) and voting on the matter | • For • Against • Abstain | No effect | No effect | |||
Proposal Three: Ratification of the appointment of KPMG LLP as our independent public accounting firm for fiscal year 2024 Majority of votes represented by the Voting Stock present at the Annual Meeting (in person or by proxy) and voting on the matter | • For • Against • Abstain | No effect | N/A | |||
Broker Non-Votes | A broker non-vote occurs when a nominee, such as a broker or bank, holding shares for a beneficial owner does not vote on a proposal because the nominee does not have discretionary authority to vote with respect to that proposal and has not received instructions with respect to that proposal from the beneficial owner. If a broker, bank, custodian, nominee, or other record holder of our Common Stock indicates on a proxy that it does not have discretionary authority to vote certain shares on a particular proposal, then the votes represented by those shares will be treated as broker non-votes with respect to that proposal. In this regard, the election of directors (Proposal One) and Say on Pay (Proposal Two) are matters considered non-routine under applicable rules. A broker or other nominee cannot vote without instructions on non-routine matters, and therefore we expect broker non-votes on Proposal One and Proposal Two. Proposal Three is a routine matter, so we do not expect any broker non-votes on this proposal. If you do not instruct your broker how to vote with respect to Proposal One or Proposal Two, your broker may not vote with respect to those proposals. Accordingly, if you own shares through a nominee, such as a broker or bank, please be sure to instruct your nominee how to vote to ensure that your vote is counted on all proposals. |
| 67 | 2024 PROXY STATEMENT |
Voting Instructions | If you complete and submit your proxy voting instructions, the persons named as proxies will follow your instructions. If you submit proxy voting instructions but do not indicate how your shares should be voted on each item, the persons named as proxies will vote “FOR” the election of directors (Proposal One), “FOR” the Say on Pay vote (Proposal Two) and “FOR” the ratification of the appointment of KPMG LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2024 (Proposal Three). The persons named as proxies will vote on any other matters properly presented at the Annual Meeting in accordance with their best judgment. We have not received timely notice of any other matters that may be properly presented for voting at the Annual Meeting. | |
Voting Results | We will announce preliminary voting results at the Annual Meeting. We will report final voting results by filing a Current Report on Form 8-K with the SEC within four business days after the Annual Meeting. If final results are not available at that time, we will provide preliminary results in the Form 8-K and will provide the final results in an amendment to the Form 8-K as soon as they become available. | |
Additional Solicitation/ | We are paying for the distribution of the proxy materials and solicitation of the proxies. As part of this process, we reimburse brokerage houses and other custodians, nominees, and fiduciaries for their reasonable out-of-pocket expenses for forwarding proxy and solicitation materials to our stockholders. Proxy solicitation expenses that we will pay include those for preparation, mailing, returning, and tabulating the proxies. Our directors, officers, and employees may also solicit proxies on our behalf in person, by telephone, email, or facsimile, but they do not receive additional compensation for providing those services. We have retained the services of Morrow Sodali LLC and may retain the services of other third-parties to solicit the proxies of certain stockholders for the Annual Meeting. The cost of such services to be rendered by Morrow Sodali LLC is estimated to be $22,000. | |
Householding | The SEC has adopted rules that permit companies and intermediaries such as brokers to satisfy delivery requirements for proxy statements with respect to two or more stockholders sharing the same address by delivering a single proxy statement addressed to those stockholders. This process, which is commonly referred to as “householding,” can provide extra convenience for stockholders and cost savings for companies. Dayforce and some brokers household proxy materials, delivering a single proxy statement to multiple stockholders sharing an address unless contrary instructions have been received from the affected stockholders. Once you have received notice from your broker or Dayforce that they or we will be householding materials to your address, householding will continue until you are notified otherwise or until you revoke your consent. If, at any time, you no longer wish to participate in householding and would prefer to receive a separate proxy statement, or if you are receiving multiple copies of the proxy statement and wish to receive only one, please notify your broker if your shares are held in a brokerage account or us if you hold Common Stock directly. Any such requests to us in writing should be addressed to: Dayforce, Inc., c/o Corporate Secretary, 3311 East Old Shakopee Road, Minneapolis, Minnesota 55425. |
| 68 | 2024 PROXY STATEMENT |
TRANSACTION OF OTHER BUSINESS AND ADDITIONAL INFORMATION |
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, the persons appointed in the accompanying proxy intend to vote the shares represented thereby in accordance with their best judgment on such matters, under applicable laws.
ADDITIONAL INFORMATIONStockholder Communications
The Board provides to every stockholder the ability to communicate with the Board through an established process for stockholder communications. Stockholders and other interested parties may send communications to our Board through our Corporate Secretary at stockholders@dayforce.com or via U.S. mail: Dayforce, Inc., c/o Corporate Secretary, 3311 East Old Shakopee Road, Minneapolis, Minnesota 55425, Attn: Board of Directors. Stockholders may indicate that their communications are intended for the full Board or any subset of directors, including only the Chair of the Board, only the Lead Director, or only the non-employee directors. The Corporate Secretary will review all such incoming communications and forward any stockholder communication to the appropriate member(s) of the Board or Board committees. The Corporate Secretary will generally not forward communications that are unrelated to the duties and responsibilities of the Board, including communications that the Corporate Secretary determines to be primarily commercial in nature, product complaints or inquiries, or materials that are patently offensive or otherwise inappropriate.
Procedures for Submitting Stockholder Proposals
Requirements for Stockholder Proposals to be Brought Before the Annual Meeting.
Our fourth amended and restated bylaws (the “Bylaws”) provide that nominations of persons for election to our Board and other proposals to be considered at an annual meeting of stockholders must comply with the requirements set forth in our Bylaws. Our Bylaws require that a stockholder give written notice to our Corporate Secretary, c/o Ceridian HCM HoldingDayforce, Inc., 3311 East Old Shakopee Road, Minneapolis, Minnesota 55425, with such notice to be delivered to or mailed and received not later than the close of business 120 days prior to the first anniversary of the date of the proxy statement for the preceding year’s annual meeting. Since our Proxy Statement for the 2024 Annual Meeting of Stockholders is dated March 22, 2019,12, 2024, stockholder proposals must be received by our Corporate Secretary at our principal executive offices no later than close of business November 23, 201912, 2024, in order to be raised at our 20202025 Annual Meeting of Stockholders. However, ourOur Bylaws also provide that in the event the date of the annual meeting is more than 30 days before or after May 1, 2020April 26, 2025 (theone-year anniversary of the 2024 Annual Meeting)Meeting of Stockholders), notice must be delivered not later than the close of business on the 10th day following the day on which public announcement of the date of such meeting is first made.
Requirements for Stockholder Proposals to be Considered for Inclusion in Our Proxy Materials. Materials.
Any stockholder who wishes to submit a proposal for inclusion in our proxy materials must comply withRule 14a-8 promulgated under the Exchange Act. For such proposals to be included in our proxy materials relating to our 20202025 Annual Meeting of Stockholders, all applicable requirements ofRule 14a-8 must be satisfied, and we must receive such proposals no later than November 23, 2019.12, 2024. Such proposals must be delivered to our Corporate Secretary, c/o Ceridian HCM HoldingDayforce, Inc., 3311 East Old Shakopee Road, Minneapolis, Minnesota 55425. If we hold our 20202025 Annual Meeting of Stockholders more than 30 days before or after May 1, 2020April 26, 2025 (theone-year anniversary date of the 2024 Annual Meeting)Meeting of Stockholders), we will disclose the new deadline by which stockholders’ proposals must be received in our earliest possible Quarterly Report onForm 10-Q or, if that method is impracticable, by any means reasonably determined to inform stockholders.
| 69 | 2024 PROXY STATEMENT |
Exemption from Toronto Stock Exchange Rules
The CompanyDayforce is an “Eligible International Interlisted Issuer”,Issuer,” as such term is defined in the TSX Company Manual (the “Manual”). As an Eligible"Eligible International Interlisted Issuer, the Company" Dayforce has applied for and received an exemption pursuant to Section 401.1 of the Manual from Sections 461.1 to 461.4 and Section 464 of the Manual, the effect of which is that the CompanyDayforce will not have to comply with certain Canadian requirements relating to majority voting and the annual election of directors. As an “Eligible International Interlisted Issuer”, the CompanyIssuer,” Dayforce is also exempt from, among other things, Sections 604 (security holder approval) and 613 of the Manual.
The CompanyDayforce sought the exemption on the basis that (i) the Company’sDayforce’s primary listing is the NYSE; (ii) the CompanyDayforce is incorporated in the Statestate of Delaware; and (iii) less than 25% of trading volume in the Company’sDayforce’s shares was on Canadian market places. The Companymarketplaces. Dayforce is required to notify the TSX of its continued reliance on the exemption before each successive annual meeting of stockholders.
ANNEX ADelinquent Section 16(a) Reports
Ceridian HCM Holding Inc. Global Employee Stock Purchase PlanBased on a review of Section 16 reports filed with the SEC, we believe all reports required to be filed during the 2023 fiscal year pursuant to Section 16(a) of the Exchange Act were filed on a timely basis, except that, as a result of administrative oversight, the Form 4 reports (i) filed on February 28, 2023, on behalf of Messrs. Armstrong, Holdridge, Jacobs, Korngiebel, McDonald, and Subramanian and Ms. Heuland; and (ii) the Form 4 reports filed on March 2, 2023, on behalf of Mr. Ossip and Ms. Turner, which reported the Compensation Committee's certification of the Company's achievement of certain performance metrics, were not timely filed.
CERIDIAN HCM HOLDING INC.
GLOBAL EMPLOYEE STOCK PURCHASE PLAN
CERIDIAN HCM HOLDING INC.
GLOBAL EMPLOYEE STOCK PURCHASE PLAN
SECTION 1
PURPOSE AND TERM
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| 70 | 2024 PROXY STATEMENT |
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SECTION 2USE OF NON-GAAP FINANCIAL MEASURES
DEFINITIONS
We use certain non-GAAP financial measures in this Proxy Statement including:
Non-GAAP Financial Measure |
| GAAP Financial Measure |
EBITDA | Net income (loss) | |
Adjusted EBITDA | Net income (loss) | |
Adjusted EBITDA margin | Net profit margin | |
Adjusted Cloud recurring gross margin | Cloud recurring gross margin | |
Adjusted operating profit | Operating profit (loss) | |
Adjusted operating profit margin | Operating profit (loss) margin | |
Percentage change in revenue, including total revenue and revenue by solution, on a constant currency basis | Percentage change in revenue, including total revenue and revenue by solution | |
Dayforce revenue retention rate | No directly comparable GAAP measure |
Any term not expressly defined inWe believe that these non-GAAP financial measures are useful to management and investors as supplemental measures to evaluate our overall operating performance including comparison across periods, with competitors, or excluding the GESPP shall haveeffect of foreign currency fluctuations. Our management team uses these non-GAAP financial measures to assess operating performance because these measures exclude the same definition as set forth in Code Section 423. Wheneverresults of decisions that are outside the following wordsnormal course of our business operations, and phrases are used in the GESPP, they shall have the respective meanings set forth below:
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SECTION 3
ELIGIBILITY AND PARTICIPATION
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A Participant may withdraw from the GESPP at any timefor internal budgeting and receiveforecasting purposes both for short- and long-term operating plans. Additionally, Adjusted EBITDA is a refundcomponent of all Contributions credited to hisour management incentive plan and Adjusted Cloud recurring gross margin is a component of certain performance-based equity awards for our NEOs. These non-GAAP financial measures are not required by, defined under, or her Plan account that have not been applied toward the purchase of shares of Common Stock by submitting a withdrawal election to the GESPP Administratorpresented in accordance with, such proceduresGAAP, and should not be considered as established by the Company, provided such withdrawal election is submittedalternatives to the GESPP Administrator no later than the fifteenth (15th) dayour results as reported under GAAP, have important limitations as analytical tools, and our use of the month in which the applicable Purchase Date falls. The Contributions of a Participant who has withdrawn from the GESPP shall be returned to the Participant, without interest, as soon as practicable after the withdrawal andthese terms may not be appliedcomparable to similarly titled measures of other companies in our industry. Our presentation of non-GAAP financial measures should not be construed to imply that our future results will be unaffected by similar items to those eliminated in this presentation.
We define these non-GAAP financial measures as follows:
| 71 | 2024 PROXY STATEMENT |
Reconciliation of GAAP To Non-GAAP Financial Measures
The following table presents a reconciliation of the GAAP results to the purchasenon-GAAP financial measures Adjusted operating profit and Adjusted operating profit margin for all periods presented:
| Year Ended December 31, | ||||||||||
2023 | 2022 |
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| 2021 | |||||||
(Unaudited, Dollars in millions) | |||||||||||
Operating profit (loss) | $ | 133.1 |
| $ | (25.8 | ) |
| $ | (35.5) | ||
Share-based compensation (a) | 137.1 | 145.1 |
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Amortization (b) | 60.5 |
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Other (c) | 9.1 | 46.0 |
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Adjusted operating profit | $ | 339.8 |
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Operating profit margin (d) | 8.8% |
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Adjusted operating profit margin (d) | 22.4% |
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SECTION 4
CONTRIBUTIONS AND PARTICIPANT ACCOUNTS
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SECTION 5
GRANT OF PURCHASE RIGHT
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SECTION 6
EXERCISE OF PURCHASE RIGHT
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SECTION 7
SHARES OF COMMON STOCK SUBJECT TO PLAN
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SECTION 8
RECAPITALIZATION, REORGANIZATION AND CHANGE OF CONTROL
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SECTION 9
PLAN ADMINISTRATION
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SECTION 10
CODE SECTION 409A TAX QUALIFICATION
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SECTION 11
INDEMNIFICATION
In addition to such other rights of indemnification as they may have as members of a committee or officers or employees of a Participating Code Section 423 Subsidiary or a ParticipatingNon-Code Section 423 Subsidiary, the Committee, the Board and any persons to whom authority to act for the Committee, the Board, or the Company is delegated shall be indemnified by the Company against all reasonable expenses, including attorneys’ fees, actually and necessarily incurred in connection with the defense of any action, suit or proceeding, or in connection with any appeal therein, to which they or any of them may be a party by reason of any action taken or failure to act under or in connection with the GESPP, or any right granted hereunder, and against all amounts paid by them in settlement thereof (provided such settlement is approved by independent legal counsel selected by the Company) or paid by them in satisfaction of a judgment in any such action, suit or proceeding, except in relation to matters as to which it shall be adjudged in such action, suit or proceeding that such person is liable for gross negligence, bad faith or intentional misconduct in duties; provided, however, that within sixty (60) calendar days after the institution of such action, suit or proceeding, such person shall offercontingent consideration related to the Company, in writing,2021 acquisition of certain assets and liabilities of DataFuzion HCM, Inc. ("DataFuzion"), foreign exchange (gain) loss, the opportunity at its own expense to handle and defend the same.
SECTION 12
PLAN AMENDMENT OR TERMINATION; MISCELLANEOUS
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An amendment must be approved by the stockholdersnet impact of the Company within twelve (12) monthsabandonment of certain leased facilities, primarily as a result of the adoption of such amendment if (i) such amendment would authorizegain on the sale of more sharesour St. Petersburg, Florida facility in 2021, severance, and the difference between the historical five-year average pension expense and the current period actuarially determined pension expense associated with the planned termination of Common Stock than are authorizedthe frozen U.S. pension plan and related changes in investment strategy associated with protecting the now fully funded status.
The following table presents a reconciliation of the GAAP results to the non-GAAP financial measures percentage change in revenue on a constant currency basis:
Year Ended December 31, | Percentage change in revenue as reported | Impact of changes in foreign currency (a) | Percentage change in revenue on a constant currency basis (a) | ||||||||||||
2023 | 202 | 2023 vs. 2022 | 2023 vs. 2022 | ||||||||||||
(Unaudited, Dollars in millions) | |||||||||||||||
Cloud recurring | $ | 1,211.4 |
| $ | 908.4 |
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Dayforce recurring revenue |
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Total revenue |
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The following table presents a reconciliation of the GAAP results to the non-GAAP financial measures EBITDA, adjusted EBITDA, and Adjusted EBITDA margin:
Year Ended December 31, 2023 | ||||||||||||||||||
Net income | Interest expense, net |
| Income tax expense |
| Depreciation and amortization |
| EBITDA (a) |
| Share-based compensation |
| Other (a) |
| Adjusted EBITDA (a) |
| Net profit margin (a) |
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(Unaudited, Dollars in millions) | ||||||||||||||||||
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| 72 | 2024 PROXY STATEMENT |
The following table presents a reconciliation of the GAAP results to the non-GAAP financial measure Adjusted Cloud recurring gross margin:
| Year Ended December 31, 2023 | |||
(Unaudited, Dollars in millions) | ||||
Cost of Cloud recurring revenue |
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Share-based compensation (a) | 15.4 | |||
Adjusted cost of Cloud recurring revenue |
| $ | 263.1 | |
Cloud recurring gross margin (b) |
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Adjusted Cloud recurring gross margin (c) |
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| 73 | 2024 PROXY STATEMENT |
CAUTIONARY STATEMENT PURSUANT TO THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
Section 27A of the corporations orSecurities Act and Section 21E of the Exchange Act, provide a “safe harbor” for forward-looking statements to encourage companies thatto provide prospective information about their companies. With the exception of historical information, the matters discussed in this Proxy Statement are forward-looking statements and may be designatedidentified by the Committeeuse of words such as Participating Code Section 423 Subsidiaries or ParticipatingNon-Code Section 423 Subsidiaries. In“anticipate,” “assume,” “believe,” “estimate,” “expect,” “intent,” “foresee,” “outlook,” “plan,” “project,” and other words and terms of similar meaning. Such statements reflect our current view with respect to future events and are subject to certain risks, uncertainties, and assumptions. A variety of factors could cause our future results to differ materially from the eventanticipated results expressed in such forward-looking statements. Readers should review Part I, Item 1A, Risk Factors, of our 2023 Annual Report for a description of important factors that could cause our future results to differ materially from those contemplated by the Board or the Committee approves an amendment to increase the numberforward-looking statements made in this Proxy Statement. Our forward-looking statements speak only as of shares of Common Stock authorized for issuance under the GESPP, the Board or Committee, as applicable and in its sole discretion, may specify that any such additional shares of Common Stock only may be issued pursuant to Purchase Rights granted after the date on which the stockholdersof this Proxy Statement or as of the Company approve such amendment,date they are made, and such designation by the Board or Committee, as applicable, shall not be deemedwe undertake no obligation to have adversely affected any Purchase Right granted prior to the date on which the stockholders approve the amendment.update our forward-looking statements.
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| 74 | 2024 PROXY STATEMENT |
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*****************************
Participating Code Section 423 andNon-Code 423 Subsidiaries
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Ceridian HCM Holding
Dayforce, Inc.
3311 East Old Shakopee Road
Minneapolis, Minnesota 55425
Signature [please sign within box] date signature (joint owners) date to vote, mark blocks below in blue or black ink as follows: keep this portion for your records this proxy card is valid only when signed and dated. Detach and return this portion only v34361-p04136 dayforce, inc. 3311 east old shakopee road minneapolis, mn 55425-1640 dayforce, inc. 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. For against abstain ! ! ! The board of directors of dayforce, inc. ("dayforce") recommends you vote for the following: 2. To approve, on a non-binding, advisory basis, the compensation of dayforce's named executive officers (commonly known as a "say on pay" vote) 3. To ratify the appointment of kpmg llp as dayforce's independent registered public accounting firm for the fiscal year ending december 31, 2024 note: in their discretion, the proxies are authorized to vote on any other business properly brought before the annual meeting or any adjournment or postponement of the annual meeting. The board of directors of dayforce recommends you vote for the following proposals: 1. To elect nine directors to hold office until the 2025 annual meeting of stockholders or until their successors are duly elected and qualified, subject to their earlier death, resignation or removal nominees: ! ! ! 1i. Gerald c. Throop 1a. Brent b. Bickett 1d. Thomas m. Hagerty 1b. Ronald f. Clarke 1c. Deborah a. Farrington 1g. Ganesh b. Rao 1e. Linda p. Mantia 1f. David d. Ossip 1h. Andrea s. Rosen for against abstain vote by internet before the meeting - go to www.proxyvote.com or scan the qr barcode above use the internet to transmit your voting instructions and for electronic delivery of information. Vote by 11:59 p.m. Edt on april 25, 2024 for shares of common stock held directly. 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. During the meeting - go to www.virtualshareholdermeeting.com/day2024 you may attend the meeting via the internet and vote during the meeting. Have the information that is printed in the box marked by the arrow available and follow the instructions. Vote by phone - 1-800-690-6903 use any touch-tone telephone to transmit your voting instructions. Vote by 11:59 p.m. Edt on april 25, 2024 for shares of common stock held directly. Have your proxy card in hand when you call and then follow the instructions. 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. Scan to view materials & vote w
ANNUAL MEETING OF CERIDIAN HCM HOLDINGV34362-P04136 Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice and Proxy Statement and Annual Report are available at www.proxyvote.com. DAYFORCE, INC.
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Please make your marks like this: ☒ Use dark black pencil or pen only
The Annual Meeting of Stockholders April 26, 2024 10:00 AM EDT This proxy is solicited by the Board of Directors Recommends a VoteFOR all the nominees listed in proposal 1 andFOR proposals 2 and 3.
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Annual Meeting of Ceridian HCM Holding Inc.
to be held on Wednesday, May 1, 2019
for Holders as of March 4, 2019
This proxy is being solicited on behalf of the Board of Directors
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The undersigned hereby appoints Scott A. Kitching and William E. McDonald and Jeremy R. Johnson, and each or any of them, as the true and lawful attorneysattorney(s) of the undersigned, with full power of substitution and revocation, and authorizes them, and each of them, to vote all the shares of capital stock of Ceridian HCM HoldingDayforce, Inc. which the undersigned is entitled to vote at said meeting and any adjournment thereof upon the matters specified and upon such other matters as may be properly brought before the meeting or any adjournment thereof, conferring authority upon such true and lawful attorneysattorney(s) to vote in their discretion on such other matters as may properly come before the meeting. This proxy, when properly executed, will be voted in the manner directed herein by the undersigned stockholder(s). If no direction is made, the proxy is authorized to vote (or abstain from voting) at his discretion on the specified resolutions. The proxy is also authorized to vote (or abstain from voting) on any other business which may properly come before the meeting. Continued and to be signed on reverse side
Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: KEEP THIS PORTION FOR YOUR RECORDS THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. DETACH AND RETURN THIS PORTION ONLY V34363-P04136 For Against Abstain ! ! ! DAYFORCE, INC. 3311 EAST OLD SHAKOPEE ROAD MINNEAPOLIS, MN 55425-1640 DAYFORCE, INC. 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. The Board of Directors of Dayforce, Inc. ("Dayforce") recommends you vote FOR the following: 2. To approve, on a non-binding, advisory basis, the compensation of Dayforce's named executive officers (commonly known as a "Say on Pay" vote) 3. To ratify the appointment of KPMG LLP as Dayforce's independent registered public accounting firm for the fiscal year ending December 31, 2024 NOTE: In their discretion, the proxies are authorized to vote on any other business properly brought before the annual meeting or any adjournment or postponement of the annual meeting. The Board of Directors of Dayforce recommends you vote FOR the following proposals: 1. To elect nine directors to hold office until the 2025 Annual Meeting of Stockholders or until their successors are duly elected and qualified, subject to their earlier death, resignation or removal Nominees: ! ! ! 1i. Gerald C. Throop 1a. Brent B. Bickett 1d. Thomas M. Hagerty 1b. Ronald F. Clarke 1c. Deborah A. Farrington 1g. Ganesh B. Rao 1e. Linda P. Mantia 1f. David D. Ossip 1h. Andrea S. Rosen ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! For Against Abstain VOTE BY INTERNET Before The Meeting - Go to www.proxyvote.com or scan the QR Barcode above Use the Internet to transmit your voting instructions and for electronic delivery of information. Vote by 5:00 p.m. EDT on April 24, 2024 for exchangeable shares held directly. 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. During The Meeting - Go to www.virtualshareholdermeeting.com/DAY2024 You may attend the meeting via the Internet and vote during the meeting. Have the information that is printed in the box marked by the arrow available and follow the instructions. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions. Vote by 5:00 p.m. EDT on April 24, 2024 for exchangeable shares held directly. Have your proxy card in hand when you call and then follow the instructions. 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. SCAN TO VIEW MATERIALS & VOTE w
V34364-P04136 Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice and Proxy Statement and Annual Report are available at www.proxyvote.com. DAYFORCE, INC. Annual Meeting of Stockholders April 26, 2024 10:00 AM EDT This proxy is solicited by the Board of Directors This Proxy Form is being solicited on behalf of Barbara Ferreri, in her capacity as trustee (the "Trustee") of the Class A Exchangeable Shares ("Exchangeable Shares") of Ceridian AcquisitionCo ULC. Votes must be received prior to 5:00 p.m. EDT on April 24, 2024 (the “Voting Deadline”). The undersigned hereby authorizes the Trustee to appoint William E. McDonald and Jeremy R. Johnson, and each or any of them, as the true and lawful attorney(s) of the undersigned, with full power of substitution and revocation, and authorizes the Trustee to designate them, and each of them, to exercise the voting rights associated with all of the Exchangeable Shares which the undersigned or the Trustee is entitled to vote at said meeting and any adjournment thereof upon the matters specified and upon such other matters as may be properly brought before the meeting or any adjournment thereof, conferring authority upon such true and lawful attorney(s) to vote in their discretion on such other matters as may properly come before the meeting. If you wish to designate someone other than William E. McDonald and Jeremy R. Johnson, please contact Dayforce, Inc. by emailing stockholders@dayforce.com. This proxy, when properly executed, will be voted in the manner directed herein by the undersigned stockholder(s). If no direction is made, the votes to which you are entitled will not be exercised. The Trustee will not be bound to exercise votes received after the Voting Deadline. You may revoke or amend this proxy once submitted by attending the meeting via internet and voting in person, by submitting an instrument in writing revoking any proxy heretofore given.previously submitted voting instructions or by providing voting instructions again using the telephone or internet before the Voting Deadline. Continued and to be signed on reverse side
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED OR, IF NO DIRECTION IS GIVEN, SHARES WILL BE VOTED FOR THE ELECTION OF THE DIRECTORS IN ITEM 1, FOR THE PROPOSALS IN ITEMS 2 AND 3 AND IN THE DISCRETION OF THE PROXYHOLDERS ON ANY OTHER MATTER THAT PROPERLY COMES BEFORE THE MEETING.
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