¨ | Preliminary Proxy Statement | |||
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þ | Definitive Proxy Statement | |||
¨ | Definitive Additional Materials | |||
¨ | Soliciting Material Pursuant to §240.14a-12 | |||
SPOK HOLDINGS, INC. | ||||
(Name of Registrant as Specified in its Charter) | ||||
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Sincerely, |
/s/Royce Yudkoff |
Royce Yudkoff |
Chair of the Board of Directors |
Spok Holdings, Inc. Notice of 2017 Annual Meeting of Stockholders | |
DATE AND TIME: | |
PLACE: | |
ITEMS OF BUSINESS: | 1.To elect seven nominees as directors to the Board of Directors; 2.To ratify the 3. To hold a non-binding advisory vote to approve 2016 named executive officer compensation ("Say-on-Pay"); 4.To hold a non-binding advisory vote on 5. To approve an amendment to the Company's 2012 Equity Incentive Award Plan; and |
WHO CAN VOTE: | You must be a stockholder of record at the close of business on |
INTERNET AVAILABILITY: | We are using the Internet as our primary means of furnishing proxy materials to most of our stockholders. Rather than sending |
PROXY VOTING: | We cordially invite you or your legal representative to participate in the Annual Meeting, either by attending and voting |
ADMISSION TO THE ANNUAL MEETING: | You are entitled to attend the virtual Annual Meeting if you were a stockholder of record as of the close of business on Annual Meeting. |
By Order of the Board of Directors, |
/s/Sharon Woods Keisling |
Sharon Woods Keisling |
Corporate Secretary and Treasurer |
Springfield, Virginia |
PROXY STATEMENT TABLE OF CONTENTS | |||
PROXY STATEMENT SUMMARY |
Proposal | Board Vote Recommendations | Page Reference |
1. Election of Seven Directors | FOR Each Nominee | |
2. Ratification of the Appointment of Independent Registered Public Accounting Firm | FOR | |
3. Advisory Vote to Approve Named Executive Officer Compensation for 2016 (“Say-on-Pay”) | FOR | |
4. Advisory Vote on the Frequency of Future Say-on-Pay Votes (“Say-When-on-Pay”) | FOR EVERY YEAR | |
5. Approve an Amendment to the Company's 2012 Equity Incentive Award Plan | FOR |
Name | Age | Director Since | Principal Occupation | Independent | Board Committee* |
N. Blair Butterfield | 60 | 2013 | Chairman, Wind River Advisory Group LLC | Yes | AC |
Stacia A. Hylton | 57 | 2015 | Retired Director, United States Marshal Service | Yes | AC |
Vincent D. Kelly | 57 | 2004 | President and Chief Executive Officer, Spok Holdings, Inc. | No | |
Brian O’Reilly | 57 | 2004 | Retired Managing Director, Toronto Dominion Bank | Yes | CC Chair, NC |
Matthew Oristano | 61 | 2004 | Chairman and Chief Executive Officer, Reaction Biology Corporation | Yes | AC Chair |
Samme L. Thompson | 71 | 2004 | Owner and President Telit Associates, Inc. | Yes | CC, NC Chair |
Royce Yudkoff | 61 | 2004 | Co-Founder, ABRY Partners, LLC | Yes | CC, NC |
- Annual election of directors by majority of votes cast (in uncontested elections) - No - 6 of our 7 directors are independent - Chair of the Board of Directors is an independent director - All Board committees consist solely of independent directors | - Stock ownership guidelines for directors and executive officers - Policies prohibiting hedging and pledging of our stock - Compensation "clawback" policy - Comprehensive Code of Business Conduct and Ethics guidelines - Strong pay-for-performance philosophy - Regular executive sessions of independent directors |
1)Grow our software revenue and bookings. | Annual software revenue fell 0.9% compared to 2015. Software operations bookings were 87.1% of 2015 software operations bookings. |
2)Retain our wireless subscribers and revenue stream. | Net churn for wireless subscribers in 2016 was 5.3% versus 6.6% in 2015. Wireless revenue declined 7.9% in 2016 versus a decline of 10.1% in 2015. |
3) Invest in our future solutions. | Research and development expenses increased by 31.0% to $13.5 million in 2016. |
4) Return capital to our stockholders. | Cash dividends declared in 2016 were $15.5 million and common stock repurchases were $6.5 million. The Company exceeded its goal to return $21 million to stockholders in 2016. |
5) Seek long-term revenue growth through business diversification. |
Corporate Governance | ||
l We provide meaningful at risk elements of compensation for | l We generally do not enter into individual executive compensation agreements. Only our CEO has an employment contract. | |
l Equity-based LTIP awards for 2016 are 100% performance based and align with stockholder value. | l We devote significant time to strategic development and linkage of quantifiable results to executive compensation. | |
l Actual realized total compensation is designed to fluctuate with, and be commensurate with, actual performance. | l We maintain a market-aligned severance policy for executives upon a change in control. No excise tax gross ups are provided to our executives. | |
l LTIP awards vest upon a change in control only if we are on track to meet our performance goals. No other "single trigger" benefits apply upon a change in control for any of our NEOs. | ||
l Incentive awards for 2016 were 100% dependent upon our performance, and are measured against objective financial metrics that are intended to link either directly or indirectly to the creation of value for our stockholders. | l The Compensation Committee uses an independent compensation consultant when seeking outside recommendations. | |
l We balance growth and return objectives, top and bottom line objectives, and short- and long-term objectives to reward overall performance that does not over-emphasize a singular focus. | l Our compensation programs do not encourage imprudent risk-taking. | |
l Our long-term incentives for financial metricsare achieved. | any form of | |
l We conduct a stockholder outreach program throughout the year. | ||
l We disclose our corporate performance goals and achievements relative to our STIP goals each year. |
QUESTIONS AND ANSWERS ABOUT THE |
Proposal Proposal 1 – Election of Directors (pages 52-55) | Voting Choices, Board Recommendation and Voting Requirement Voting Choices · Vote for · Vote against · Abstain from voting. Board Recommendation The Board recommends a vote “FOR” each of the nominees named in the Proxy Statement. Voting Requirement Directors will be elected by |
Proposal 2 – Ratification of | Voting Choices · Vote for the ratification; · Vote against the ratification; or · Abstain from voting. Board Recommendation The Board recommends a vote “FOR” this proposal. Voting Requirement The |
Proposal 3 – Advisory Vote to Approve | Voting Choices · Vote for the approval of the compensation of the Company’s named executive officers; · Vote against the approval of the compensation of the Company’s named executive officers; or · Abstain from voting. Board Recommendation The Board recommends a vote “FOR” this proposal. Voting Requirement The advisory approval of the compensation of the Company's named executive officers requires a majority of the votes cast. Thus, the compensation of the Company’s named executive officers will be approved on an advisory basis if the votes cast “FOR” exceed the votes cast “AGAINST”. This vote is not binding upon the Company, the Board or the Compensation Committee. Nevertheless, the Compensation Committee values the opinions expressed by stockholders in their vote on this proposal and will consider the outcome of the vote when making future compensation decisions for the Company’s named executive officers. |
Proposal 4 – Advisory Vote on the Frequency of Future Say-on-Pay Votes ("Say-When-on-Pay") (page 58) | Voting Choices · Vote for EVERY YEAR; · Vote for EVERY TWO YEARS; · Vote for EVERY THREE YEARS; or · Abstain from voting. Board Recommendation The Board recommends a vote for EVERY YEAR. Voting Requirement The advisory vote on the frequency of future Say-on-Pay votes requires a majority of the votes cast for approval. Thus, the option of EVERY YEAR, EVERY TWO YEARS or EVERY THREE YEARS will be approved on an advisory basis if the votes cast for such option exceed the votes cast for the other alternatives. In the event that no option receives a majority of the votes cast, the option that receives the most votes will be considered the option recommended by stockholders. This vote is not binding upon the Company, the Board or the Compensation Committee. Nevertheless, the Compensation Committee values the opinions expressed by stockholders in their vote on this proposal and will consider the outcome of the vote when making decisions on the frequency of future Say-on-Pay votes. |
Proposal 5 – Amendment to the Company's 2012 Equity Incentive Award Plan (“2012 Equity Plan”) (page 59-65) | Voting Choice · Vote for the approval of the amendment to the Company’s 2012 Equity Plan; · Vote against the approval of the amendment to the Company’s 2012 Equity Plan; or · Abstain from voting. Board Recommendation The Board recommends a vote “FOR” this proposal. Voting Requirement The approval of the amendment to the Company’s 2012 Equity Plan requires a majority of the votes cast. Thus, the amendment of the 2012 Equity Plan will be approved if the votes cast “FOR” exceed the votes cast “AGAINST”. |
(a) | giving written notice to the Corporate Secretary of the Company; |
(b) | delivering a later-dated proxy; or |
(c) | voting |
BOARD OF DIRECTORS AND GOVERNANCE MATTERS |
Committee Audit Compensation Nominating and Governance | Primary Responsibilities The Audit Committee assists the Board in its oversight of the integrity of the Company’s financial statements and financial reporting processes and systems of internal control; the qualifications, independence and performance of the Company’s independent registered public accounting firm, the internal auditors and the internal audit function and the Company’s compliance with legal and regulatory requirements. The Audit Committee also prepares the Audit Committee Report that the rules of the SEC require the Company to include in its proxy statement. See pages 17 The Compensation Committee determines, reviews and approves the compensation of the NEOs, including salary, annual short-term incentive awards and long-term incentive awards. The Compensation Committee reviews director compensation and recommends changes in compensation to the Board. In addition, the Compensation Committee evaluates the design and effectiveness of the Company’s incentive programs. See pages 19 The Nominating and Governance Committee identifies individuals qualified to become Board members consistent with the criteria established by the Board, which are described in the Company’s Corporate Governance Guidelines, and recommends a slate of nominees for election at each annual meeting of stockholders; makes recommendations to the Board concerning the appropriate size, function, needs and composition of the Board and its committees; advises the Board on corporate governance matters, including the development of recommendations to the Board on the Company’s corporate governance principles; and oversees the self-evaluation process of the Board and its committees. |
Name N. Blair Butterfield* Nicholas A. Gallopo* Vincent D. Kelly Brian O’Reilly* Matthew Oristano* Samme L. Thompson* Royce Yudkoff*(4) | Audit(1) √ Chair √ √ | Compensation(2) Chair √ √ | Nominating and Governance(3) √ Chair √ |
2014 Meetings | 4 | 3 | 2 |
Name | Audit(1) | Compensation(2) | Nominating and Governance(3) |
N. Blair Butterfield* | √ | ||
Stacia A. Hylton* | √ | ||
Vincent D. Kelly | |||
Brian O’Reilly* | Chair | √ | |
Matthew Oristano*(4) | Chair | ||
Samme L. Thompson*(5) | √ | Chair | |
Royce Yudkoff*(6) | √ | √ | |
2016 Meetings | 5 | 3 | 1 |
(1) | The Audit Committee consists entirely of non-management directors all of whom the Board has determined are independent within the meaning of the listing standards of |
(2) | The Compensation Committee consists entirely of non-management directors all of whom the Board has determined are independent within the meaning of the listing standards of NASDAQ, are non-employee directors for the purposes of Rule 16b-3 of the Exchange Act; and satisfy the requirements of Internal Revenue Code Section 162(m) for outside directors. |
(3) | The Nominating and Governance Committee consists entirely of non-management directors all of whom the Board has determined are independent within the meaning of the listing standards of NASDAQ. |
(4) | Mr. Oristano became Chair of the Audit Committee in November 2016 after the death of Mr. Nicholas Gallopo, the former Chair of the Audit Committee. |
(5) | Mr. Thompson became Chair of the Nominating and Governance Committee in November 2016 after Mr. Oristano became Chair of the Audit Committee. |
(6) | Chair of the Board of Directors. |
Type of Compensation | Non-Executive Director (excluding Chair of Audit Committee) | Chair of Audit Committee | Non-Executive Director (excluding Chair of Audit Committee) | Chair of Audit Committee |
Annual Cash Fee(1) | $45,000 | $55,000 | $45,000 | $55,000 |
Annual Restricted Stock Award Value | $60,000 | $70,000 | $60,000 | $70,000 |
(1) | Both the cash fee and restricted stock award value are paid in quarterly installments. |
(2) | Restricted stock vests one year following the grant date, subject to earlier vesting upon a change in control. |
Director Name | Fees Earned or Paid in Cash ($) | Restricted Stock Awards ($) | Total ($) | Fees Earned or Paid in Cash ($) | Restricted Stock Awards ($)(4) | Total ($) |
Royce Yudkoff (1) | 45,000 | 60,000 | 105,000 | 45,000 | 60,000 | 105,000 |
N. Blair Butterfield (1) | 45,000 | 60,000 | 105,000 | 45,000 | 60,000 | 105,000 |
Nicholas A. Gallopo | 55,000 | 70,000 | 125,000 | 55,000 | 70,000 | 125,000 |
Stacia A. Hylton(1) | 45,000 | 60,000 | 105,000 | |||
Brian O’Reilly (1) | 45,000 | 60,000 | 105,000 | 45,000 | 60,000 | 105,000 |
Matthew Oristano (1) | 45,000 | 60,000 | 105,000 | |||
Matthew Oristano (1)(3) | 45,000 | 60,000 | 105,000 | |||
Samme L. Thompson (1) | 45,000 | 60,000 | 105,000 | 45,000 | 60,000 | 105,000 |
(1) | Included in the column “Restricted Stock Awards” is a total of |
(2) | Included in the column “Restricted Stock Awards” is a total of |
(3) | Mr. Oristano became Chair of the Audit Committee in |
(4) | Amounts shown reflect the grant date fair value of the restricted stock awards as determined under FASB ASC Topic 718. For additional information, refer to note 5 of the audited financial statements that were included in the Company's 2016 Annual Report on Form 10-K. |
(5) | Mr. Gallopo died in November 2016. The Board of Directors authorized full payment and |
AUDIT COMMITTEE MATTERS |
Grant Thornton LLP | For the Year Ended December 31, | For the Year Ended December 31, | ||||||
2014 | 2013 | 2016 | 2015 | |||||
Audit Fees(1) | $1,367,048 | $1,486,037 | $1,210,203 | $1,331,622 | ||||
Audit-Related Fees(2) | — | 40,040 | 21,515 | — | ||||
Tax Fees | — | — | — | — | ||||
All Other Fees | — | — | — | — | ||||
Total | $1,367,048 | $1,526,077 | $1,231,718 | $1,331,622 |
(1) | The audit fees (including out-of-pocket expenses) for the years ended December 31, |
(2) |
COMPENSATION COMMITTEE MATTERS |
EXECUTIVE COMPENSATION |
COMPENSATION DISCUSSION AND ANALYSIS - TABLE OF CONTENTS |
COMPENSATION TABLES | ||
COMPENSATION DISCUSSION AND ANALYSIS |
NAME | POSITION |
Vincent D. Kelly | President and Chief Executive Officer |
Hemant Goel | President, Spok, Inc. |
Shawn E. Endsley(1) | Chief Accounting Officer (Former Chief Financial Officer) |
Thomas G. Saine | Chief Information Officer |
Bonnie K. Culp-Fingerhut | Executive Vice President – Human Resource and Chief |
(1) | Mr. Endsley served as our CFO during fiscal year 2016. Effective March 27, 2017, Mr. Michael Wallace was appointed CFO and Mr. Endsley became CAO. Mr. Wallace will be an NEO in 2017. |
1) |
2) |
3) | Speaking with stockholders representing approximately 26.7% of our outstanding shares throughout the year, including four of our ten largest stockholders. |
1) |
2) |
3) |
4) |
5) |
COMPENSATION PRINCIPLES Link We believe that compensation levels should reflect performance. This is accomplished by: • Motivating, recognizing, and rewarding individual excellence; • Paying short-term cash bonuses based upon Company financial performance; and • Linking elements of long-term compensation to our Company’s financial performance. Maintain competitive compensation levels. We strive to offer programs and levels of compensation that are competitive with those offered by companies of similar size in order to attract, retain and reward our executives including the NEOs. Align management’s interests with those of stockholders. We seek to implement programs that will retain the executives while increasing long-term stockholder value by providing competitive compensation and granting long-term equity-based incentives. |
1)Grow our software revenue and bookings. | Annual software revenue fell 0.9% compared to 2015. Software operations bookings were 87.1% of 2015 software operations bookings. |
2)Retain our wireless subscribers and revenue stream. | Net churn for wireless subscribers in 2016 was 5.3% versus 6.6% in 2015. Wireless revenue declined 7.9% in 2016 versus a decline of 10.1% in 2015. |
3) Invest in our future solutions. | Research and development expenses increased by 31.0% to $13.5 million in 2016. |
4) Return capital to our stockholders. | Cash dividends declared in 2016 were $15.5 million and common stock repurchases were $6.5 million. The Company exceeded its goal to return $21 million to stockholders in 2016. |
5) Seek long-term revenue growth through business diversification. |
REVENUE |
(IN MILLIONS) |
RESEARCH AND DEVELOPMENT EXPENSES |
(IN MILLIONS) |
CONSOLIDATED ADJUSTED OCF(1) |
(IN MILLIONS) |
SOFTWARE OPERATIONS BOOKINGS(1),(2) |
(IN MILLIONS) |
(2) | Software operations bookings in 2014 reflect $6.7 million in federal government activity that was not replicated in subsequent years. |
CASH ALLOCATION 2011-2016(1) |
(IN MILLIONS) |
(1) | Cash distributions and share repurchases excludes the special dividend of $5.2 million declared in December 2016 and paid in January 2017. |
1) |
2) |
3) | Speaking with four of our ten largest stockholders throughout the year. |
1) |
2) |
3) |
4) |
5) |
Pay-for-Performance | |
l We generally do not enter into individual executive compensation agreements. Only our CEO has an employment contract. | |
l Equity-based LTIP awards for | l We devote significant time to strategic development and linkage of quantifiable results to executive compensation. |
l Actual realized total compensation is designed to fluctuate with, and be commensurate with, actual performance. | l We maintain a market-aligned severance policy for |
l LTIP awards vest upon a change in control only if we are on track to meet our performance | |
l Incentive awards for | |
l We balance growth and return objectives, top and bottom line objectives, and short- and long-term | l Our compensation |
l Our long-term incentives for 2016 were delivered in the form of | |
l We review our pay-for-performance relationship on an annual basis. | l We conduct a stockholder outreach program throughout the year. |
l We disclose our corporate performance goals and |
(1) | The “At-Risk” compensation elements are based on incentive plans approved in advance by the Compensation Committee. Both the STIP and LTIP for 2016 were 100% performance based. Both the STIP and LTIP provide for non-payment or caps on potential payment of the awards if the pre-established performance criteria are not met or exceeded. Both the STIP and LTIP |
Performance Criteria(2) | Relative Weight | Threshold Payout Against Target | Threshold Performance Level (In 000s) | Target Payout | Target Performance Level (In 000s) | Maximum Payout Against Target | Maximum Performance Level (In 000s) | Relative Weight | Threshold Payout Against Target | Threshold Performance Level (In 000s) | Target Payout | Target Performance Level (In 000s) | Maximum Payout Against Target | Maximum Performance Level (In 000s) | ||
OCF(1) | 50% | 75% | $28,432 | 100% | $35,540 | 125% | $42,648 | |||||||||
Consolidated Adjusted OCF(1) | 50% | 80% | $18,996 | 100% | $23,745 | 125% | $28,494 | |||||||||
Consolidated Revenue | 25% | 70% | $175,325 | 100% | $194,806 | 130% | $214,286 | 25% | 80% | $150,040 | 100% | $187,550 | 130% | $206,305 | ||
Operations Bookings | 25% | 75% | $35,406 | 100% | $39,340 | 125% | $43,274 | |||||||||
Software Operations Bookings(3) | 25% | 80% | $32,000 | 100% | $40,000 | 150% | $44,000 | |||||||||
Total | 100% | 73.75% | 100% | 126.25% | 100% | 80.00% | 100% | 132.50% |
(1) | OCF is calculated as operating income plus depreciation, amortization and accretion less purchases of property and equipment (all determined in accordance with U.S. GAAP). Adjusted OCF is defined as OCF less severance, restructuring and impairment expenses. OCF is a non-GAAP measure used as a measure of free cash flow. |
(2) | The Compensation Committee selected the performance criteria as key measures in determining stockholder value. The relative weight assigned to each performance measure reflects the judgment of the Compensation Committee as to the importance each measure has to stockholder value. |
(3) | Software operations bookings represent contractual arrangements to provide software licenses, professional services and equipment sales. These contractual arrangements (bookings) represent future revenue. |
Performance Criteria | Relative Weight | Actual Performance (in 000s) | Actual Payout | Weighted Actual Payout | Relative Weight | Actual Performance (in 000s) | Actual Payout | Weighted Actual Payout |
OCF | 50% | $37,149 | 106.8% | 53.4% | ||||
Consolidated Adjusted OCF | 50% | $30,306 | 125.0% | 62.5% | ||||
Consolidated Revenue | 25% | $200,273 | 111.2% | 27.8% | 25% | $179,561 | 95.7% | 23.9% |
Operations Bookings | 25% | $45,408 | 125.0% | 31.3% | ||||
Software Operations Bookings | 25% | $33,597 | 84.0% | 21.0% | ||||
Total | 100% | 112.5% | 100% | 107.4% |
NEO | STIP Percentage of Base Salary | Targeted Payout ($) | Actual Payout ($) | STIP Target Opportunity - Percentage of Base Salary | Targeted Payout ($) | Actual Payout ($) |
Vincent D. Kelly | 100% | 600,000 | 675,000 | 100% | 600,000 | 644,400 |
Hemant Goel | 100% | 350,000 | 375,900 | |||
Shawn E. Endsley | 75% | 187,500 | 210,938 | 75% | 187,500 | 201,375 |
Colin M. Balmforth | 75% | 262,500 | 295,313 | |||
Thomas G. Saine | 75% | 206,250 | 221,513 | |||
Bonnie K. Culp-Fingerhut | 75% | 151,939 | 170,931 | 75% | 168,750 | 181,238 |
Thomas G. Saine | 75% | 206,250 | 232,031 |
2016 LTIP Grant | ||||||
2016-2018 Performance Period Criteria(2) | ||||||
Item # | Consolidated Revenue | Item # | Consolidated Adjusted OCF(1) | |||
1 | Cumulative Consolidated Revenue 2016-2018 | 3 | Cumulative Consolidated Adjusted OCF 2016-2018 | |||
2 | Minimum 2018 Consolidated Revenue | 4 | Minimum 2018 Consolidated Adjusted OCF | |||
Weighting | 50% | 50% |
(1) | Consolidated OCF is defined as operating income plus depreciation, amortization and accretion, less capital expenditures (all determined in accordance with GAAP). Adjusted OCF is defined as OCF less severance, restructuring and impairment expenses. OCF is a non-GAAP measure used as a measure of free cash flow. |
(2) | Payout Conditions - |
2011 LTIP Performance Criteria ($ in 000s): | ||||
Target | Achievement | |||
Cumulative Consolidated Revenue (2011 – 2014)(1) | $827,556 | $866,468 | ||
Cumulative Consolidated Operating Cash Flow (2011 -2014)(2) | 207,110 | 222,729 | ||
Minimum 2014 Software Revenue | 55,767 | 67,871 | ||
Minimum 2014 Operating Cash Flow | 28,569 | 38,644 |
NEO | Job Title | 2011 LTIP Award ($)(1) | Number of RSUs(2) | Fair Value at Grant Date ($)(3) | RSU's Awarded(1) | Value at Grant Date(1) | Market Value at Year-End(2) | ||
Vincent D. Kelly | CEO | 3,000,000 | 216,034 | 3,011,787 | 81,877 | 1,375,534 | 1,698,948 | ||
Hemant Goel | 16,375 | 275,100 | 339,781 | ||||||
Shawn E. Endsley | CFO | 281,250 | 24,079 | 270,166 | 10,234 | 171,931 | 212,356 | ||
Colin M. Balmforth | President | 599,590 | 50,598 | 566,698 | |||||
Thomas G. Saine | 11,258 | 189,134 | 233,604 | ||||||
Bonnie K. Culp-Fingerhut | EVP-HR and Administration | 227,908 | 19,512 | 297,857 | 9,211 | 154,745 | 191,128 | ||
Thomas G. Saine | CIO | 309,375 | 26,487 | 297,184 |
(1) | The target value of the |
(2) | Market or payout values of the unvested RSUs were based on the target number of RSUs |
COMPENSATION TABLES |
Stock or RSU Awards | Non-Equity Incentive Plan Compensation | |||||||||||||
NEO | Job Title | Year | Salary ($)(1) | LTIP Awards ($)(2) | STIP Awards ($) | STIP Awards ($)(3) | LTIP Awards ($) | All Other Compensation ($)(4) | Total Compensation ($) | |||||
Vincent D. Kelly | 2014 | 600,000 | — | — | 675,000 | — | 209,926 | 1,484,926 | ||||||
CEO | 2013 | 600,000 | 3,011,787 | — | 644,400 | — | 27,102 | 4,283,289 | ||||||
2012 | 600,000 | — | 538,790 | 538,800 | 900,000 | 486,706 | 3,064,296 | |||||||
Shawn E. Endsley | 2014 | 250,000 | — | — | 210,938 | — | 31,611 | 492,552 | ||||||
CFO | 2013 | 250,000 | 270,166 | — | 201,375 | — | 6,923 | 728,464 | ||||||
2012 | 210,577 | — | — | 143,257 | 188,708 | 94,999 | 637,541 | |||||||
Colin Balmforth(5) | President | 2014 | 350,000 | — | — | 295,313 | — | 57,650 | 702,963 | |||||
2013 | 350,000 | — | — | 281,925 | — | 6,863 | 638,788 | |||||||
Bonnie K. Culp-Fingerhut(6) | EVP, HR & Administration | 2014 | 202,585 | — | — | 170,931 | — | 24,113 | 397,629 | |||||
Thomas G. Saine | 2014 | 275,000 | — | — | 232,031 | — | 33,539 | 540,570 | ||||||
CIO | 2013 | 275,000 | 297,184 | — | 245,231 | — | 6,863 | 824,278 | ||||||
2012 | 275,000 | — | — | 185,213 | 309,375 | 163,576 | 933,164 |
Stock Awards | Non-Equity Incentive Plan Compensation | |||||||||
NEO | Job Title | Year | Salary ($)(1) | LTIP Awards ($)(2) | STIP Awards ($)(3) | All Other Compensation ($)(4) | Total Compensation ($) | |||
Vincent D. Kelly | CEO | 2016 | 600,000 | 1,375,534 | 644,400 | 27,517 | 2,647,451 | |||
2015 | 623,077 | 1,499,991 | 451,200 | 29,762 | 2,604,030 | |||||
2014 | 600,000 | — | 675,000 | 209,926 | 1,484,926 | |||||
Hemant Goel | President, Spok Inc. | 2016 | 350,000 | 275,100 | 375,900 | 7,177 | 1,008,177 | |||
2015 | 350,962 | 301,950 | 254,701 | 151,258 | 1,058,871 | |||||
Shawn E. Endsley | CAO and Former CFO | 2016 | 250,000 | 171,931 | 201,375 | 8,069 | 631,375 | |||
2015 | 259,615 | 187,488 | 141,000 | 8,270 | 596,373 | |||||
2014 | 250,000 | — | 210,938 | 31,611 | 492,549 | |||||
Thomas G. Saine | CIO | 2016 | 275,000 | 189,134 | 221,513 | 7,163 | 692,810 | |||
2015 | 285,577 | 206,237 | 155,100 | 7,198 | 654,112 | |||||
2014 | 275,000 | — | 232,031 | 33,539 | 540,570 | |||||
Bonnie K. Culp-Fingerhut | EVP, HR & CCO | 2016 | 225,000 | 154,745 | 181,238 | 9,141 | 570,124 | |||
2015 | 210,377 | 151,935 | 114,258 | 6,323 | 482,893 | |||||
2014 | 202,585 | — | 170,931 | 24,113 | 397,629 |
(1) | Amounts shown represent base salaries earned for the applicable year. For 2015 all employees of the Company including the NEOs, received one additional biweekly payment due to a payroll leap year. |
(2) | The fair value of the |
(3) | Amounts shown represent |
(4) | Additional information is provided in the |
NEO | Job Title | Year | Perquisites($)(1) | Insurance Premiums($) | Company Contribution to Defined Contribution Plans ($) | Dividend Equivalent Rights ($)(2) | Total ($) | |||||
Vincent D. Kelly | CEO | 2014 | 21,088 | 1,032 | 6,500 | 181,306 | 209,926 | |||||
2013 | 20,239 | 488 | 6,375 | — | 27,102 | |||||||
2012 | 23,101 | 170 | 6,250 | 457,185 | 486,706 | |||||||
Shawn E. Endsley | CFO | 2014 | — | 1,032 | 6,500 | 24,079 | 31,611 | |||||
2013 | — | 913 | 6,010 | — | 6,923 | |||||||
2012 | — | 170 | 5,490 | 89,339 | 94,999 | |||||||
Colin Balmforth | President | 2014 | — | 552 | 6,500 | 50,598 | 57,650 | |||||
2013 | — | 488 | 6,375 | — | 6,863 | |||||||
Bonnie K. Culp-Fingerhut | EVP, Human Resources and Administration | 2014 | — | 1,212 | 3,387 | 19,514 | 24,113 | |||||
Thomas G. Saine | CIO | 2014 | — | 552 | 6,500 | 26,487 | 33,539 | |||||
2013 | — | 488 | 6,375 | — | 6,863 | |||||||
2012 | — | 170 | 6,250 | 157,156 | 163,576 |
NEO | Job Title | Year | Perquisites($)(1) | Insurance Premiums($) | Company Contribution to Defined Contribution Plans ($) | Total ($) | ||||
Vincent D. Kelly | CEO | 2016 | 19,860 | 1,032 | 6,625 | 27,517 | ||||
Hemant Goel | President, Spok Inc. | 2016 | — | 552 | 6,625 | 7,177 | ||||
Shawn E. Endsley | CAO and Former CFO | 2016 | — | 1,584 | 6,485 | 8,069 | ||||
Thomas G. Saine | CIO | 2016 | — | 552 | 6,611 | 7,163 | ||||
Bonnie K. Culp-Fingerhut | EVP, HR & CCO | 2016 | — | 2,516 | 6,625 | 9,141 |
(1) | All perquisite amounts shown in the table for Mr. Kelly for 2016 were for car |
NEO | Job Title | Award | % of Base Salary | Threshold Payout ($) | Target Payout ($) (1) | Maximum Payout ($) | |
Vincent D. Kelly | CEO | 2014 STIP | 100 | % | 442,500 | 600,000 | 757,500 |
Shawn E. Endsley | CFO | 2014 STIP | 75 | % | 138,281 | 187,500 | 236,719 |
Colin Balmforth | President | 2014 STIP | 75 | % | 193,594 | 262,500 | 331,406 |
Bonnie Culp-Fingerhut | EVP, HR & Administration | 2014 STIP | 75 | % | 112,055 | 151,939 | 191,823 |
Thomas G. Saine | CIO | 2014 STIP | 75 | % | 152,109 | 206,250 | 260,391 |
Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(1) | Estimated Possible Payouts Under Equity Incentive Plan Awards(2) | |||||||||||||||||
NEO | Award | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | Grant Date Fair Value ($)(3) | ||||||||||
Vincent D. Kelly | 2016 STIP | 480,000 | 600,000 | 795,000 | — | — | — | — | ||||||||||
2016 LTIP | — | — | — | 40,939 | 81,877 | 81,877 | 1,375,534 | |||||||||||
Hemant Goel | 2016 STIP | 280,000 | 350,000 | 463,750 | — | — | — | — | ||||||||||
2016 LTIP | — | — | — | 8,188 | 16,375 | 16,375 | 275,100 | |||||||||||
Shawn E. Endsley | 2016 STIP | 150,000 | 187,500 | 248,438 | — | — | — | — | ||||||||||
2016 LTIP | — | — | — | 5,117 | 10,234 | 10,234 | 171,931 | |||||||||||
Thomas G. Saine | 2016 STIP | 165,000 | 206,250 | 273,281 | — | — | — | — | ||||||||||
2016 LTIP | — | — | — | 5,629 | 11,258 | 11,258 | 189,134 | |||||||||||
Bonnie K. Culp-Fingerhut | 2016 STIP | 135,000 | 168,750 | 223,594 | — | — | — | — | ||||||||||
2016 LTIP | — | — | — | 4,606 | 9,211 | 9,211 | 154,745 |
(1) | Amounts |
(2) | Amounts represent the RSUs awarded under the performance based 2016 LTIP to the NEOs in 2016. The RSUs are convertible into shares of the Company's common stock if the pre-established performance goals of the 2016 LTIP are achieved. The performance period of the 2016 LTIP is the three year period ending December 31, 2018. |
(3) | Amounts represent the grant date fair value based upon the probable outcome of the underlying performance conditions as of the grant date, calculated in accordance with FASB ASC Topic 718.For additional information, refer to notes 7 and 9 of the audited financial statements that were included in the Company's 2016 Annual Report on Form 10-K. |
Equity Incentive Plan Awards: | Equity Incentive Plan Awards: | ||||||||
NEO | Job Title | Number of Unearned RSUs That Have Not Vested (#)(1) | Market or Payout Value of Unearned RSUs That Have Not Vested ($)(2) | Number of Unearned RSUs That Have Not Vested (#)(1) | Market or Payout Value of Unearned RSUs That Have Not Vested ($)(2) | ||||
Vincent D. Kelly | CEO | 216,034 | 3,750,350 | 168,282 | 3,491,852 | ||||
Hemant Goel | 33,872 | 702,844 | |||||||
Shawn E. Endsley | CFO | 24,079 | 418,011 | 21,034 | 436,456 | ||||
Colin Balmforth | President | 50,598 | 878,381 | ||||||
Bonnie Culp-Fingerhut | EVP, HR & Administration | 19,512 | 338,728 | ||||||
Thomas G. Saine | CIO | 26,487 | 459,814 | 23,138 | 480,114 | ||||
Bonnie K. Culp-Fingerhut | 17,963 | 372,732 |
(1) | The RSUs were awarded under the |
(2) | Market or payout values of the unvested RSUs were based on our closing stock price at December 31, |
(1) | A disability benefit equal to 50% of the base salary during the disability |
(2) | All other unpaid amounts under any Company fringe benefit and incentive compensation programs, at the time such payments are |
(3) | An amount equal to the |
(4) | An amount equal to the product of (i) a fraction based on the prorated number of days earned in the calendar year as of the date of |
(1) | Base salary through the date of death; |
(2) | All other unpaid amounts under any Company fringe benefit and incentive compensation programs, at the time such payments are |
(3) | An amount equal to the |
(4) | An amount equal to the product of (i) a fraction based on the prorated number of days earned in the calendar year as of the date of death, times (ii) the annual STIP target amount payable within 45 days after the date of termination. |
(1) | Base salary through the date of termination payable within 10 business days; |
(2) | All other unpaid amounts under any Company fringe benefit and incentive compensation programs, at the time such payments are due; |
(3) | An amount equal to |
(4) | An amount equal to the annual STIP target for the calendar year in which the termination occurs, payable within 45 days after the date of termination; |
(5) | An amount equal to the product of (i) a fraction based on the prorated number of days earned in the calendar year as of the date of termination, times (ii) the annual STIP target amount payable within 45 days after the date of termination; |
(6) | Reimbursement of the cost of continued group health plan benefits in accordance with the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”) for 18 months, to the extent elected by the CEO and to the extent the CEO is eligible and subject to the terms of the plan and the law; |
(7) | Reimbursement for expenses reasonably incurred by Mr. Kelly in securing outplacement services through a professional person or entity of his choice, subject to the approval of the Company, at a level commensurate with Mr. Kelly’s position, for up to one year commencing on or before the one-year anniversary of the date of termination at his election, not to exceed $35,000; and |
(8) | Full vesting of any unvested equity awards. |
Vincent D. Kelly CEO | Disability ($)(1) | Death ($) | Termination without Cause or For Good Reason ($)(2) | ||||||
Other Income(3) | 175,000 | — | — | ||||||
Salary Benefit(4) | 1,800,000 | 1,800,000 | 1,800,000 | ||||||
Life Insurance(5) | N/A | 250,000 | N/A | ||||||
Accrued Vacation Pay(6) | 362,846 | 327,964 | 327,694 | ||||||
Health Benefits(7) | — | — | 25,087 | ||||||
2014 STIP (8) | 600,000 | 600,000 | 1,200,000 | ||||||
2011 LTIP (9) | 3,750,350 | 3,750,350 | 3,750,350 | ||||||
All Other Compensation(10) | 181,306 | 181,306 | 216,306 | ||||||
Total | 6,944,502 | 6,984,621 | 8,121,015 |
Vincent D. Kelly CEO | Disability ($)(1) | Death ($)(1) | Termination without Cause or For Good Reason ($)(1) | ||||||
Employment Agreement Benefits | |||||||||
Other Income(2) | 437,438 | — | — | ||||||
Salary and Lump Sum Benefits(3) | 1,200,000 | 1,200,000 | 2,400,000 | ||||||
Health Benefits(6) | — | — | 52,734 | ||||||
Total Compensation under Employment Agreement | 1,637,438 | 1,200,000 | 2,452,734 | ||||||
Company Incentive Plans and Other Benefits | |||||||||
Life Insurance(4) | — | 250,000 | — | ||||||
Accrued Vacation Pay(5) | — | 297,965 | 297,965 | ||||||
2016 STIP(7) | 644,400 | 644,400 | 644,400 | ||||||
2015 LTIP Award(8) | 1,183,317 | 1,183,317 | 1,792,904 | ||||||
2016 LTIP Award(9) | 560,653 | 560,653 | 1,698,948 | ||||||
All Other Compensation(10) | 180,215 | 180,215 | 215,215 | ||||||
Total Compensation from Company Incentive Plans and Other Benefits | 2,568,585 | 3,116,550 | 4,649,432 | ||||||
Total Compensation | 4,206,023 | 4,316,550 | 7,102,166 |
(1) | For purposes of the Disability benefits, Mr. Kelly was assumed to be disabled on June 1, |
(2) |
This amount assumed Mr. Kelly has been paid his pro rata base salary from January 1, |
(3) | These amounts represent the relevant lump sum payments pursuant to Mr. Kelly’s employment agreement and include the additional STIP target bonus amounts. |
(4) |
This represents a standard benefit available to all employees. |
This payment was based on accrued vacation hours at |
This was the cost of continuation of health benefits provided to Mr. Kelly. At his expense, Mr. Kelly or his beneficiary is entitled to continuation of health coverage pursuant to COBRA under the “Disability” or “Death” scenario. The amount reflected in the table under “Termination without Cause or For Good Reason” scenario represented reimbursement of the cost of continuation of health benefits provided to Mr. Kelly for 18 months. |
(7) | These amounts represent the actual amount of Mr. Kelly's 2016 STIP that was unpaid as of the date of termination, December 31, 2016. |
(8) | Pursuant to the terms of the 2015 LTIP award, Mr. Kelly was entitled to 66% of the target award for purposes of the "Disability" and "Death" scenarios. With respect to the "Termination without Cause or for Good Reason" scenario Mr. Kelly is entitled to full vesting of any unvested equity awards. The |
(9) | Pursuant to the terms |
(10) | The amount reflected under |
Colin Balmforth President | Disability ($)(1) | Death ($) | Termination without Cause or For Good Reason ($) | ||||||
Other Income(2) | 86,154 | — | — | ||||||
Salary Benefit(3) | 862,055 | 862,055 | 862,055 | ||||||
Life Insurance(4) | N/A | 250,000 | N/A | ||||||
Accrued Vacation Pay(5) | 27,735 | 34,983 | 34,983 | ||||||
Health Benefits(6) | — | — | 21,751 | ||||||
2014 STIP (7) | 262,500 | 262,500 | 787,500 | ||||||
2011 LTIP (8) | 878,381 | 878,381 | 878,381 | ||||||
All Other Compensation(9) | 56,930 | 56,930 | 91,930 | ||||||
Total | 2,206,567 | 2,377,661 | 2,676,600 |
(1) | Continued payment of base salary for a minimum of twenty-six (26) weeks, plus an additional two weeks for each year of service, up to a combined maximum of fifty-two (52) weeks (the “Severance Period”); |
(2) | Continued group health plan benefits in accordance with COBRA. Under the Severance Agreements, COBRA coverage will be provided to NEOs at the discounted employee rate for |
(3) | Prorated portion of the |
NEO | Job Title | Salary ($) | Accrued Vacation Pay ($)(1) | Health Benefits ($)(2) | 2014 STIP ($)(3) | 2011 LTIP - Equity ($)(4) | All Other Compensation ($)(5) | Total ($) | Job Title | Salary ($) | Accrued Vacation Pay ($)(1) | Health Benefits ($)(2) | 2016 STIP ($)(3) | 2015 and 2016 LTIP Awards - Equity ($)(4) | All Other Compensation ($)(5) | Total ($) |
Hemant Goel | President, Spok Inc. | 201,923 | 37,537 | 10,882 | 375,900 | 351,749 | 36,340 | 1,014,331 | ||||||||
Shawn E. Endsley | CFO | 221,154 | 122,115 | 1,079 | 210,938 | 418,011 | 24,079 | 997,376 | CAO and Former CFO | 240,385 | 160,096 | 4,134 | 201,375 | 217,983 | 22,526 | 846,499 |
Thomas G. Saine | CIO | 232,692 | 40,050 | 4,134 | 221,513 | 239,786 | 24,779 | 762,954 | ||||||||
Bonnie K. Culp-Fingerhut | EVP, HR and Administration | 233,752 | 25,464 | 3,168 | 170,931 | 338,728 | 19,512 | 791,555 | EVP, HR & CCO | 225,000 | 43,858 | 13,184 | 181,238 | 182,931 | 18,942 | 665,153 |
Thomas G. Saine | CIO | 211,538 | 17,839 | 1,079 | 232,031 | 459,814 | 26,487 | 948,789 |
(1) | These payments were based on accrued vacation hours at December 31, |
(2) | These amounts |
(3) | These amounts represent the actual STIP award paid to the NEOs for 2016. The Company’s performance for |
(4) | Pursuant to the terms of the LTIP, the NEOs were entitled to 66% of the target award for the 2015 grant and 33% of the target award for the 2016 grant. The amounts |
(5) | These amounts |
(1) | A cash lump sum payment equal to a minimum of 1.5 times the executive’s base salary, plus an additional two weeks of base salary for each year of service, up to a maximum payment of |
(2) | Accident and health insurance benefits substantially similar to those that the executive was receiving immediately prior to termination until the earlier to occur of 18 months following termination or such time as the executive is covered by comparable programs of a subsequent employer, reduced to the extent of any comparable benefits received from another source; and |
(3) | An amount equal to 100% of the executive’s target award under the annual STIP for the calendar year in which the termination |
(1) | Fifty percent (50%) of the participant’s target award shall vest if a change in control occurs during |
(2) | Seventy-five percent (75%) of the participant’s target award shall vest if a change in control occurs during the |
(3) | One hundred percent (100%) of the participant’s target award shall vest if a change in control occurs during the |
NEO | Job Title | Salary ($)(1) | Accrued Vacation Pay ($)(2) | Health Benefits ($)(3) | 2014 STIP ($)(4) | 2011 LTIP ($)(5) | All Other Compensation ($)(6) | Total ($) | Job Title | Salary ($)(1) | Accrued Vacation Pay ($)(2) | Health Benefits ($)(3) | 2016 STIP ($)(4) | 2015 and 2016 LTIP Awards - Equity ($)(5) | All Other Compensation ($)(6) | Total ($) |
Hemant Goel | President, Spok Inc. | 551,923 | 37,537 | 32,646 | 350,000 | 442,188 | 36,340 | 1,450,634 | ||||||||
Shawn E. Endsley | CFO | 471,154 | 122,115 | 3,237 | 210,938 | 418,011 | 24,079 | 1,249,534 | CAO and Former CFO | 490,385 | 160,096 | 12,402 | 187,500 | 274,253 | 22,526 | 1,147,162 |
Thomas G. Saine | CIO | 507,692 | 40,050 | 12,402 | 206,250 | 301,684 | 24,779 | 1,092,857 | ||||||||
Bonnie K. Culp-Fingerhut | EVP, HR and Administration | 436,337 | 25,464 | 9,504 | 170,931 | 227,908 | 19,512 | 889,656 | EVP, HR & CCO | 450,000 | 43,858 | 39,552 | 168,750 | 231,767 | 18,942 | 952,869 |
Thomas G. Saine | CIO | 486,538 | 17,839 | 3,237 | 232,031 | 459,814 | 26,487 | 1,225,946 |
(1) | These amounts |
(2) | These payments were based on accrued vacation hours at December 31, |
(3) | These amounts |
(4) | These amounts |
(5) | These amounts |
(6) | These amounts |
PROPOSALS REQUIRING YOUR VOTE |
Royce Yudkoff Position, Principal Occupation and Professional Experience: Prior to the merger of Metrocall and Arch in November 2004, Mr. Yudkoff had been a director of Metrocall since April 1997, and had served as the Chair of its Board since February 2003. In 1989, Mr. Yudkoff co-founded ABRY Partners, LLC, a private equity investment firm, which focuses on the media, communications and business services sectors. Mr. Yudkoff currently serves on the Board of ABRY Partners, LLC; Stafford Insurance Company and America's Kitchen, Inc. Mr. Yudkoff served on the Board of Muzak Holdings LLC from 2002 to 2009, Talent Partners from 2000 to 2014, Media Ocean, LLC from 2014 to 2015 and Nextstar Broadcasting Group, Inc. from 1996 to 2014. Director Qualifications: Mr. Yudkoff has an understanding of our operations, strategies, financial | |
outlook and ongoing challenges. In addition, Mr. Yudkoff has experience in the media and communication sectors that can be applied to our operations. Mr. Yudkoff has the requisite qualifications to continue as a director. |
N. Blair Butterfield, age 60, became a director of the Company in July 2013. He is a member of the Audit Committee. Position, Principal Occupation and Professional Experience: Mr. Butterfield is a senior health information technology (“IT”) executive and eHealth expert with over twenty-five years of global experience in new market and business development, general management, government initiatives, sales management, and strategic marketing. In 2015, Mr. Butterfield became Chairman of Wind River Advisory Group LLC, a strategic health IT consultancy. From 2012 through 2015, Mr. Butterfield was President of VitalHealth Software, developer of a cloud-based eHealth application development platform with solutions for collaborative care, patient engagement, and certified electronic health records. He has also served as Vice President, International Development for eHealth at GE Healthcare from 2006 to 2011. Previously, Mr. Butterfield served on the Boards of the California Institute of Computer Assisted Surgery (CICAS) from 2011 to 2013, | |
AllClear Diagnostics LLC from 2011 to 2013, the eHealth Initiative from 2008 to 2010, and VistA Software Alliance from 2006 to 2008. Director Qualifications: Mr. Butterfield has extensive experience in the software industry that can be applied to our operations in such market segments as health information exchange (HIE), electronic medical records (EMR), medical imaging, standards-based interoperability, and clinical informatics. Mr. Butterfield has the requisite qualifications to continue as a director. |
Stacia A. Hylton, age 57, became a director of the Company in 2015. Ms. Hylton is a member of the Audit Committee. Position, Principal Occupation and Professional Experience: Ms. Hylton currently serves as a Principle for LS Advisory, a New Jersey-based business solutions advisory consultancy. She also serves as a member on the Boards of Lexis Nexis Special Services, Inc., an information solutions company and subsidiary of RELX Inc., and Core Civic, Inc., a publicly traded national leader providing government real estate solutions, high quality corrections and detention management and residential reentry centers. In 2016, Ms. Hylton served as Senior Vice President for Cyber Security at MTM Technologies, Inc., a leading national provider of innovative IT solutions and services. In 2010, Ms. Hylton was nominated by the President of the United States and confirmed by the United States Senate as Director of the United States Marshal Service (“USMS”), a federal law enforcement agency within the Unites States Department of Justice. USMS is the | |
nation’s oldest and most versatile federal law enforcement agency and is responsible for judicial security, fugitive operations, asset forfeitures, prisoner operations and transport and witness security. The USMS employs over 5,400 employees with a budget in excess of $1.1 billion. Ms. Hylton retired as Director of USMS in 2015. In 2010, she was President of Hylton, Kirk and Associates, a private consulting firm located in the Commonwealth of Virginia. From 2004 to 2010 Ms. Hylton served as the Federal Detention Trustee in the United States Department of Justice. From 1980 through 2004 she served in progressively responsible positions within USMS. Director Qualifications: Ms. Hylton has extensive operational and executive management experience that includes budgeting, procurement, technology and personnel. This experience included management of a multi-billion dollar budget, multi-year fiscal planning and long-term procurements. Ms. Hylton provides insight into government operations and procurement which assists the Company in developing and growing key market segments for our critical communication solutions. Ms. Hylton has the requisite qualifications to continue serving as a Director. |
Vincent D. Kelly, age 57, became a director, President and Chief Executive Officer (“CEO”) of the Company in November 2004 when USA Mobility was formed through the merger of Metrocall and Arch and continues to serve as CEO. Prior to the merger of Metrocall and Arch, Mr. Kelly was President and CEO of Metrocall since February 2003. Position, Principal Occupation and Professional Experience: Prior to this appointment, he had also served at various times as the Chief Operating Officer (“COO”), Chief Financial Officer (“CFO”), and Executive Vice President (“EVP”) of Metrocall. He served as the Treasurer of Metrocall from August 1995 to February 2003, and served as a director of Metrocall from 1990 to 1996 and from May 2003 to November 2004. Mr. Kelly also serves as the President and CEO and a director for all of our subsidiaries, except for Spok Canada, an indirect wholly-owned subsidiary, for which Mr. Kelly is only a director. Mr. Kelly serves on the Board of PageNet Canada, Inc. of which he became a Director in 2016. Mr. Kelly served on the Board of Tellabs from 2012 to 2013 and Penton | |
Media from 2003 to 2007. Director Qualifications: Mr. Kelly has been involved with the wireless and telecommunications industry for over 25 years and has been a director and CEO of the Company since November 2004. Mr. Kelly has the requisite qualifications to continue as a director. |
Brian O’Reilly, age 57, became a director of the Company in November 2004. He is a member of the Nominating and Governance Committee and is the Chair of the Compensation Committee. Position, Principal Occupation and Professional Experience: Prior to the merger of Metrocall and Arch, Mr. O’Reilly had been a director of Metrocall since October 2002. He was with Toronto-Dominion Bank for 16 years, from 1986 to 2002. From 1986 to 1996, Mr. O’Reilly served as the Managing Director of Toronto-Dominion Bank’s Loan Syndication Group, focused on the underwriting of media and telecommunications loans. From 1996 to 2002, he served as the Managing Director of Toronto-Dominion Bank’s Media, Telecom and Technology Group with primary responsibility for investment banking in the wireless and emerging telecommunications sectors. Mr. O’Reilly has been involved with the paging industry as a director since 2002 and a director of the Company since November 2004. | |
Director Qualifications: Mr. O’Reilly has an understanding of our operations, strategies, financial outlook and ongoing challenges. In addition Mr. O’Reilly has past experience in the underwriting of media and communication financing that can be applied to our operations. Mr. O’Reilly has the requisite qualifications to continue as a director. |
Matthew Oristano, age 61, became a director of the Company in November 2004. He is Chair of the Audit Committee. Position, Principal Occupation and Professional Experience: Prior to the merger of Metrocall and Arch, Mr. Oristano had been a director of Arch since 2002. Mr. Oristano has served as Chair of the Board and CEO of Reaction Biology Corporation, a contract biomedical research firm since March 2004. He has been a member of the Board of Crystalplex Corporation since 2004. He has also been the President, CEO and member of the Board of Alda Inc., an investment management company, since 1995. From 1993 to 1999, he was the Chairman and CEO of People's Choice TV, a NASDAQ listed company. Mr. Oristano has been involved with the paging industry as a director since 2002 and a director of the Company since November 2004. Director Qualifications: Mr. Oristano has an understanding of our operations, strategies, | |
financial outlook and ongoing challenges. In addition, Mr. Oristano has past experience in investment management and telecommunications company operations. As a CEO, Mr. Oristano has directly supervised CFOs and been involved in the annual audit process. Mr. Oristano is also considered an audit committee financial expert. Mr. Oristano has the requisite qualifications to continue as a director. |
Samme L. Thompson, age 71, became a director of the Company in November 2004. He is a member of the Compensation Committee and is Chair of the Nominating and Governance Committee. Position, Principal Occupation and Professional Experience: Prior to the merger of Metrocall and Arch, Mr. Thompson had been a director of Arch since 2002. Mr. Thompson currently serves on the Boards of the following non-profit organizations: | |
he has been a member of the Board of American Tower Corporation (“ATC”), which Director Qualifications: Mr. Thompson has been involved with the paging industry as a director since 2002. Mr. Thompson has an understanding of our operations, strategies, financial outlook and ongoing challenges. In addition, Mr. Thompson has past experience in corporate strategic and business development that can be applied to our current operations. Mr. Thompson has the requisite qualifications to continue as a director. |
Name and Position | Dollar Value ($) | Number of Units |
Vincent D. Kelly, President and Chief Executive Officer | — | — |
Hemant Goel, President, Spok, Inc. | — | — |
Shawn E. Endsley, Chief Financial Officer(2) | — | — |
Thomas G. Saine, Chief Information Officer | — | — |
Bonnie K. Culp-Fingerhut, Executive Vice President - Human Resource and Chief Compliance Officer | — | — |
All current executive officers as a group | — | — |
All employees who are not executive officers | — | — |
All non-employee directors as a group(1) | $370,000 | 19,577 |
Name and Position | Number of Shares Subject to Restricted Stock and RSU Awards Granted Since Adoption of the 2012 Equity Plan |
Vincent D. Kelly, President and Chief Executive Officer | 461,424 |
Hemant Goel, President, Spok, Inc. | 57,968 |
Shawn E. Endsley, Chief Accounting Officer | 54,149 |
Thomas G. Saine, Chief Information Officer | 59,564 |
Bonnie K. Culp-Fingerhut, Executive Vice President - Human Resource and Chief Compliance Officer | 45,607 |
All current executive officers as a group | 728,197 |
All employees who are not executive officers | 354,761 |
All non-employee directors as a group | 107,361 |
Plan Category | Number of securities to be issued upon exercise of outstanding options, warrants and rights (a) | Weighted-average exercise price of outstanding options, warrants and rights (b) | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) | |||||
Equity compensation plan approved by security holders:(1) | ||||||||
2012 Spok Holdings, Inc. Equity Incentive Plan(2)(3) | 455,111 | — | 1,246,939 | |||||
Equity compensation plan not approved by security holders: | ||||||||
None | — | — | — | |||||
Total | 455,111 | — | 1,246,939 |
(1) | The 2012 Equity Plan provides that common stock authorized for issuance under the plan may be granted in the form of common stock, stock options, restricted stock and RSUs. For the year ending December 31, 2016, 23,649 shares of restricted stock were granted to the non-executive members of the Board, 234,711 RSUs, less 22,069 RSUs due to forfeitures and adjustments, were issued to eligible employees under the 2012 Equity Plan. |
(2) | The amount shown represents outstanding RSUs granted under the 2012 Equity Plan. |
(3) | RSUs do not have any associated exercise or strike price. |
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT |
Name of Beneficial Owner | Amount and Nature of Beneficial Ownership | Percentage of Class | ||||
Vincent D. Kelly, CEO(1) | 196,214 | * | ||||
Shawn E. Endsley, CFO(2) | 32,000 | * | ||||
Colin M. Balmforth, President(3) | 23,800 | * | ||||
Bonnie K. Culp-Fingerhut, EVP HR & Administration(4) | 26,408 | * | ||||
Thomas G. Saine, CIO(4) | 39,303 | * | ||||
Royce Yudkoff, Director(2) | 25,245 | * | ||||
Nicholas A. Gallopo, Director(2) | 33,002 | * | ||||
Brian O’Reilly, Director(2) | 17,876 | * | ||||
N. Blair Butterfield, Director(2) | 2,670 | * | ||||
Matthew Oristano, Director(2) | 18,199 | * | ||||
Samme L. Thompson, Director(2) | 27,999 | * | ||||
All directors and executive officers as a group (11 persons) | 442,716 | 2.0 | % | |||
The Vanguard Group, Inc.(5) | 1,733,842 | 8.0 | % | |||
BlackRock Inc.(6) | 3,031,574 | 14.0 | % | |||
Renaissance Technologies LLC and Renaissance Technologies Holdings Corporation(7) | 1,739,600 | 8.0 | % | |||
Braeside Investments, LLC, Steven McIntyre and Todd Stein(8) | 1,903,447 | 8.8 | % |
Name of Beneficial Owner | Amount and Nature of Beneficial Ownership | Percentage of Class | |||||
Vincent D. Kelly(1) | 116,214 | * | |||||
Hemant Goel | — | * | |||||
Shawn E. Endsley | 32,000 | * | |||||
Thomas G. Saine | 13,847 | * | |||||
Bonnie K. Culp-Fingerhut | 26,408 | * | |||||
Royce Yudkoff(2) | 35,632 | * | |||||
Stacia A. Hylton(2) | 5,436 | * | |||||
Brian O’Reilly(2) | 24,490 | * | |||||
N. Blair Butterfield(2) | 13,057 | * | |||||
Matthew Oristano(2) | 24,945 | * | |||||
Samme L. Thompson(2) | 34,613 | * | |||||
All directors and executive officers as a group (13 persons)(3) | 333,642 | 1.63 | % | ||||
The Vanguard Group, Inc.(4) | 2,200,956 | 10.71 | % | ||||
BlackRock Inc.(5) | 3,487,215 | 16.99 | % | ||||
Renaissance Technologies LLC and Renaissance Technologies Holdings Corporation(6) | 1,575,800 | 7.67 | % | ||||
Braeside Investments, LLC, Steven McIntyre and Todd Stein(7) | 1,373,021 | 6.69 | % | ||||
Dimensional Fund Advisers LP(8) | 1,486,593 | 7.24 | % |
(1) | The information regarding this stockholder is derived from a Form 4 filed by the stockholder with the SEC on March |
(2) | The information regarding this stockholder is derived from a Form 4 filed by the stockholder with the SEC on April |
(3) |
(4) |
The information regarding this stockholder is derived from an amended Schedule 13G filed by the stockholder with the SEC on February |
The information regarding this stockholder is derived from an amended Schedule 13G filed by the stockholder with the SEC on January |
The information regarding this stockholder is derived from an amended Schedule 13G filed by the stockholder with the SEC on February |
The information regarding this stockholder is derived from an amended Schedule 13G filed by the stockholder with the SEC on February |
(8) | The information regarding this stockholder is derived from a Schedule 13G filed by the stockholder with the SEC on February 9, 2017. The Dimensional Fund Advisors LP, has sole voting power with respect to 1,412,747 shares and sole dispositive power with respect to all shares reported herein. The Dimensional Fund Advisors LP's address is as follows: Building One, 6300 Bee Cave Road, Austin, Texas, 78746. |
RELATED PARTY TRANSACTIONS AND CODE OF CONDUCT |
STOCKHOLDER PROPOSALS AND COMPANY DOCUMENTS |
OTHER MATTERS |
1. | Section 2.37(a) of the Plan is hereby amended by deleting such section in its entirety and replacing it with the following: |
2. | Section 4.6 of the Plan is hereby amended by adding the following at the end of the penultimate sentence thereof: |
3. | This Amendment shall be and is hereby incorporated in and forms a part of the Plan. |
4. | Except as set forth herein, the Plan shall remain in full force and effect. |