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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 14A

 

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

 

Filed by the Registrant ☒ Filed by a Party other than the Registrant ☐

 

Check the appropriate box:

 

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 Under Rule § 240.14a-12

 

BLINK CHARGING CO.

(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 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

 

 

 

   
 

 

BLINK CHARGING CO.

5081 Howerton Way, Suite A

Bowie, Maryland 20715

 

NOTICE OF VIRTUAL ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD ON JULY 16, 2024

 

To the Stockholders of Blink Charging Co.

 

NOTICE IS HEREBY GIVEN that the 2024 Annual Meeting (the “Annual Meeting”) of Stockholders of Blink Charging Co., a Nevada corporation (the “Company”), will be held virtually on July 16, 2024, at 9:00 a.m., Eastern time, for the following purposes:

 

  1. Elect six directors to the Board of Directors of Blink Charging Co. (the “Board”) for a one-year term of office expiring at the 2025 Annual Meeting of Stockholders, with the nominees for election being Ritsaart J.M. van Montfrans, Brendan S. Jones, Aviv Hillo, Jack Levine, Kristina A. Peterson and Cedric L. Richmond.
  2. Approve, on a non-binding advisory basis, the compensation paid to the Company’s executive officers.
  3. Approve, on a non-binding advisory basis, the frequency of future advisory votes on the compensation of the Company’s executive officers.
  4. Ratify the appointment of Grant Thornton LLP as our independent registered public accounting firm for the year ending December 31, 2024.
  5. Transact such other business as may properly come before the Annual Meeting or any continuation, postponement or adjournment thereof.

 

The foregoing items of business are more fully described in the Proxy Statement accompanying this Notice of Annual Meeting of Stockholders.

 

The Board has fixed the close of business on May 20, 2024 as the record date for the determination of stockholders entitled to notice of, and to vote at, this Annual Meeting and any continuation, postponement or adjournment thereof. Whether or not you plan on attending the Annual Meeting, we encourage you to submit your proxy as soon as possible using one of three convenient methods: (i) by accessing the Internet site described in the voting instruction form provided to you, (ii) by calling the toll-free number in the voting instruction form provided to you, or (iii) by signing, dating and returning any proxy card or instruction form provided to you.

 

We have elected to take advantage of the Securities and Exchange Commission’s rule that allows us to furnish our proxy materials to our stockholders over the Internet. We believe electronic delivery will expedite the receipt of materials and, by printing and mailing a smaller volume, will reduce the environmental impact of our Annual Meeting materials and help lower our costs. On or about June 6, 2024, a Notice of Internet Availability of Proxy Materials (the “Notice of Internet Availability”) will be mailed to our stockholders. This Notice of Internet Availability will contain instructions on how to access the Notice of Annual Meeting, the Proxy Statement and our 2023 Annual Report on Form 10-K to stockholders online. You will not receive a printed copy of these materials unless you specifically request one. The Notice of Internet Availability contains instructions on how to receive a paper copy of the proxy materials.

 

  By Order of the Board of Directors,
   
 
  Ritsaart J.M. van Montfrans
  Chairman
   
Bowie, Maryland  
June 3, 2024  

 

   
 

 

You may vote in the following ways:

 

   

VOTE BY INTERNET

www.proxyvote.com

 

VOTE BY PHONE –

1-800-690-6903

 

VOTE BY MAIL –

envelope included

         
Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m., Eastern time, the day before the meeting date. Have your proxy card in hand when you access the website and follow the instructions to obtain your records and to create an electronic voting instruction form.   Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m., Eastern time, the day before the meeting date. Have your proxy card in hand when you call and then follow the instructions.   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.

 

ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS

 

If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years.

 

1
 

 

PROXY STATEMENT SUMMARY

 

This summary contains highlights about the upcoming 2024 Annual Meeting of Stockholders (the “Annual Meeting”) of Blink Charging Co. (the “Company,” “Blink,” “we,” “us” or “our”). This summary does not contain all of the information that you should consider in advance of the meeting and we encourage you to read the entire Proxy Statement before voting.

 

2024 Annual Meeting of Stockholders

 

Date and Time:   July 16, 2024 at 9:00 a.m., Eastern time
   
Location:   Via live webcast at www.virtualshareholdermeeting.com/BLNK2024
   
Record Date:   May 20, 2024
   
Mail Date:   We intend to mail a Notice of Internet Availability of Proxy Materials to our stockholders on or about June 6, 2024

 

Voting Matters and Board Recommendations

 

Proposal No.   Proposals  

Recommendation

of the Board

(1)   The election of six directors to serve on our Board for a one-year term of office expiring at the 2025 Annual Meeting of Stockholders.  

FOR

each Director Nominee

         
(2)   To approve, on a non-binding advisory basis, the compensation paid to the Company’s executive officers.   FOR
         
(3)   To approve, on a non-binding advisory basis, the frequency of future advisory votes on the compensation of the Company’s executive officers.  

FOR

Every Year

         
(4)   The ratification of the appointment of Grant Thornton LLP as our independent registered public accounting firm for the year ending December 31, 2024.   FOR

 

Only holders of record of our common stock, par value $0.001 per share (the “Common Stock”), at the close of business on May 20, 2024 (the “Record Date”) are entitled to notice of and to vote at the Annual Meeting. On the Record Date, there were issued and outstanding approximately 101,059,734 shares of our Common Stock.

 

Each share of Common Stock entitles the holder thereof to one vote. This Proxy Statement is dated as of June 3, 2024 and is first being sent out or otherwise made available to stockholders of record on or about June 6, 2024.

 

2
 

 

GENERAL INFORMATION

 

Our Company

 

Blink Charging Co., through its wholly owned subsidiaries, is a leading owner, operator and provider of electric vehicle (“EV”) charging equipment and networked EV charging services. Blink offers residential and commercial EV charging equipment, enabling EV drivers to recharge at various location types. Blink’s principal line of products and services is its Blink EV charging networks (the “Blink Networks”) and Blink EV charging equipment, also known as electric vehicle supply equipment (“EVSE”) and other EV-related services. The Blink Networks provide property owners, managers, parking companies, and state and municipal entities (“Property Partners”) with cloud-based services that enable the remote monitoring and management of EV charging stations. The Blink Networks also provide EV drivers with vital station information, including station location, availability and fees. Blink, through its wholly owned subsidiary, Envoy Mobility, Inc. (“Envoy Mobility”), also operates a car sharing program which allows customers the ability to rent EVs through a public subscription service in numerous urban areas and as an amenity for national real estate developers and owners of private buildings. In addition to this core focus, Blink is actively engaged in various initiatives and programs promoting sustainability and renewable energy, including the promotion of solar energy, batteries and other technologies that support eco-friendly practices.

 

Information Concerning Voting and Solicitation

 

The enclosed proxy is solicited on behalf of the Board of Directors of Blink Charging Co., a Nevada corporation, for use at our 2024 Annual Meeting of Stockholders, to be held on July 16, 2024 at 9:00 a.m., Eastern time, or at any continuation, postponement or adjournment thereof, for the purposes discussed in this Proxy Statement and any business properly brought before the Annual Meeting. Proxies are solicited to give all stockholders of record an opportunity to vote on matters properly presented at the Annual Meeting. The Annual Meeting will be held via live webcast at www.virtualshareholdermeeting.com/BLNK2024.

 

Our proxy materials are available electronically at www.proxyvote.com. At this website, you will find a complete set of the proxy materials including the Proxy Statement, 2023 Annual Report and form proxy card. You are encouraged to access and review all of the information contained in the proxy materials before submitting a proxy or voting at the meeting.

 

Who Can Vote

 

The Board has set May 20, 2024 as the Record Date for the Annual Meeting. You are entitled to notice and to vote if you were a stockholder of record of our Common Stock as of the close of business on May 20, 2024. You are entitled to one vote on each proposal for each share of Common Stock you held on the Record Date. Your shares may be voted at the Annual Meeting only if you are present in person or your shares are represented by a valid proxy.

 

Difference between a Stockholder “of Record” and a “Street Name” Holder

 

If your shares are registered directly in your name, you are considered the stockholder of record with respect to those shares.

 

If your shares are held in a stock brokerage account or by a bank, trust or other nominee, then the broker, bank, trust or other nominee is considered to be the stockholder of record with respect to those shares. However, you are still considered to be the beneficial owner of those shares, and your shares are said to be held in “street name.” Street name holders generally cannot submit a proxy or vote their shares directly and must instead instruct the broker, bank, trust or other nominee how to vote their shares. Stockholders whose shares are held in street name through a brokerage account may receive separate forms or instructions from their respective brokers for voting purposes. Stockholders are encouraged to consult with their brokers or review any additional materials provided by their brokers in conjunction with this proxy statement.

 

3
 

 

Shares Outstanding and Quorum

 

At the close of business on May 20, 2024, there were 101,059,734 shares of our Common Stock outstanding and entitled to vote at the Annual Meeting. The presence of holders of one-third, or 33.34%, of the outstanding shares of our Common Stock entitled to vote constitutes a quorum, which is required to hold and conduct business at the Annual Meeting. Shares are counted as present at the Annual Meeting if:

 

  you are present in person at the Annual Meeting; or
     
  your shares are represented by a properly authorized and submitted proxy (submitted by mail, by telephone or over the Internet).

 

If you are a record holder and you submit your proxy, regardless of whether you abstain from voting on one or more matters, your shares will be counted as present at the Annual Meeting for the purpose of determining a quorum. If your shares are held in “street name,” your shares are counted as present for purposes of determining a quorum if your broker, bank, trust or other nominee submits a proxy covering your shares. Your broker, bank, trust or other nominee is entitled to submit a proxy covering your shares as to certain routine matters such as ratification of independent registered public accountants, even if you have not instructed your broker, bank, trust or other nominee on how to vote on those matters. Please see the subsection “If You Do Not Specify How You Want Your Shares Voted” below. In the absence of a quorum, the Annual Meeting may be adjourned to a day, time and place as determined by the chairman of the meeting.

 

Voting Your Shares

 

You may vote using any of the following methods:

 

  By Mail — Stockholders of record may submit proxies by completing, signing and dating their proxy cards and mailing them in the accompanying pre-addressed envelopes. Blink stockholders who hold shares beneficially in street name may provide voting instructions by mail by completing, signing and dating the voting instruction forms provided by their brokers, banks or other nominees and mailing them in the accompanying pre-addressed envelopes.
     
  By Internet — Stockholders of record may submit proxies by following the Internet voting instructions on their proxy cards. Blink stockholders who hold shares beneficially in street name may provide voting instructions by accessing the website specified on the voting instruction forms provided by their brokers, banks or nominees. Please check the voting instruction form for Internet voting availability.
     
  By Telephone — Blink stockholders who hold shares beneficially in street name and live in the United States or Canada may provide voting instructions by telephone by calling the number specified on the voting instruction forms provided by their brokers, banks or nominees. Please check the voting instruction form for telephone voting availability.
     
  During the Annual Meeting — Shares held in your name as the stockholder of record may be voted during the Annual Meeting. Shares held beneficially in street name may be voted in person only if you obtain a legal proxy from the broker, bank or nominee that holds your shares giving you the right to vote the shares.

 

Even if you plan to attend the Annual Meeting via the live webcast, we recommend that you also submit your proxy or voting instructions by mail, telephone or Internet so that your vote will be counted if you later decide not to attend the Annual Meeting. The Internet and telephone voting facilities will close at 11:59 p.m., Eastern time (for stockholders of record), and 11:59 p.m., Eastern time (for shares held beneficially in street name), on July 15, 2024, the day before the Annual Meeting. Stockholders who submit a proxy by Internet or telephone need not return a proxy card or the form forwarded by your broker, bank, trust or other holder of record by mail.

 

Changing Your Vote

 

As a stockholder of record, if you submit a proxy, you may revoke that proxy at any time before it is voted at the Annual Meeting. Stockholders of record may revoke a proxy prior to the Annual Meeting by (i) delivering a written notice of revocation to the attention of the Corporate Secretary at our executive offices located at 5081 Howerton Way, Suite A, Bowie, Maryland 20715, (ii) duly submitting a later-dated proxy over the Internet, by telephone or by mail, or (iii) attending the Annual Meeting in person and voting in person. Attendance at the Annual Meeting will not, by itself, revoke a proxy. If your shares are held in the name of a broker, bank, trust or other nominee, you may change your voting instructions by following the instructions of your broker, bank, trust or other nominee.

 

4
 

 

If You Receive More Than One Proxy Card or Notice

 

If you receive more than one set of proxy materials, it means you hold shares that are registered in more than one account. To ensure that all of your shares are voted, sign and return each proxy card or, if you submit a proxy by telephone or the Internet, submit one proxy for each proxy card you receive.

 

How Will Your Shares Be Voted

 

Stockholders of record as of the close of business on May 20, 2024 are entitled to one vote for each share of our Common Stock held on all matters to be voted upon at the Annual Meeting. All shares entitled to vote and represented by properly submitted proxies received before the polls are closed at the Annual Meeting, and not revoked or superseded, will be voted at the Annual Meeting in accordance with the instructions indicated on those proxies.

 

If You Do Not Specify How You Want Your Shares Voted

 

As a stockholder of record, if you submit a signed proxy card or submit your proxy by telephone or Internet and do not specify how you want your shares voted, the person named in the proxy will vote your shares:

 

  FOR the election of the six nominees listed in this Proxy Statement to serve on our Board for a one-year term of office expiring at the 2025 Annual Meeting of Stockholders.
     
  FOR the approval, on a non-binding advisory basis, of the compensation paid to our executive officers (the “say-on-pay” vote).
     
  FOR the approval, on a non-binding advisory basis, of the frequency of future advisory votes on the compensation of our executive officers every year (the “frequency vote”).
     
  FOR the ratification of the appointment of Grant Thornton LLP as our independent registered public accounting firm for the year ending December 31, 2024.

 

A “broker non-vote” occurs when a nominee holding shares for a beneficial owner has not received voting instructions from the beneficial owner and the nominee does not have discretionary authority to vote the shares. If you hold your shares in street name and do not provide voting instructions to your broker or other nominee, your shares will be considered to be broker non-votes and will not be voted on any proposal on which your broker or other nominee does not have discretionary authority to vote. Shares that constitute broker non-votes will be counted as present at the Annual Meeting for the purpose of determining a quorum but will not be considered entitled to vote on all the proposals in question. Brokers generally have discretionary authority to vote on the ratification of the appointment of Grant Thornton LLP as our independent registered public accounting firm, which is considered a “routine” matter. Brokers, however, do not have discretionary authority to vote on the election of directors to serve on our Board, the approval of executive compensation and the advisory resolution on the frequency of the stockholders’ say-on-pay, each of which are considered “non-routine” under Nasdaq rules.

 

In their discretion, the proxy holders named in the proxy are authorized to vote on any other matters that may properly come before the Annual Meeting and at any continuation, postponement or adjournment thereof. The Board knows of no other items of business that will be presented for consideration at the Annual Meeting other than those described in this Proxy Statement. No stockholder proposal or nomination was received prior to the deadline set forth in our Bylaws and, accordingly, no such matters may be brought to a vote at the Annual Meeting.

 

Inspector of Election and Counting of Votes

 

All votes will be tabulated as required by Nevada law, the state of our incorporation, by the inspector of election appointed for the Annual Meeting, who will separately tabulate affirmative and negative votes, abstentions and broker non-votes. Shares held by persons attending the Annual Meeting but not voting, shares represented by proxies that reflect abstentions as to one or more proposals and broker non-votes will be counted as present for purposes of determining a quorum.

 

5
 

 

Election of Directors. Vote by a plurality of the shares voting is required for the election of directors under Proposal 1. You may vote “FOR” all nominees, “WITHHOLD” your vote as to all nominees, or “FOR” all nominees except those specific nominees from whom you “WITHHOLD” your vote. There is no “AGAINST” option. The nominees receiving the most “FOR” votes will be elected. A properly executed proxy marked “WITHHOLD” with respect to the election of one or more directors will not be voted with respect to the director or directors indicated. Broker non-votes will have no effect on the outcome of Proposal 1.

 

Advisory (Non-Binding) “Say-on-Pay” Vote to Approve Executive Compensation for 2023. The approval of the executive compensation requires the affirmative vote of the majority of the votes cast on Proposal 2. You may vote “FOR,” “AGAINST” or “ABSTAIN.” If you “ABSTAIN” from voting on Proposal 2, the abstention will have no effect on the outcome of Proposal 2. Broker non-votes will have no effect on the outcome of Proposal 2.

 

Advisory (Non-Binding) “Frequency” Vote Regarding the Frequency of Future Stockholder Votes on Executive Compensation. The approval of the advisory resolution on the frequency of the stockholders’ say-on-pay requires that one of the three frequency options receives a majority of the votes cast. You have four choices for voting on Proposal 3. You can choose whether the “say-on-pay” vote should be held every year, every two years or every three years. You may also abstain from voting. If you abstain from voting on Proposal 3, the abstention will have no effect on the outcome of Proposal 3. Pursuant to Nasdaq regulations, brokers do not have discretionary voting power with respect to this proposal, and broker non-votes will have no effect on the outcome of Proposal 3.

 

Ratification of the Independent Registered Accounting Firm. The ratification of the appointment of Grant Thornton LLP requires the affirmative vote of the majority of the votes cast on Proposal 4. You may vote “FOR,” “AGAINST” or “ABSTAIN.” If you “ABSTAIN” from voting on Proposal 4, the abstention will have no effect on the outcome of Proposal 4. Brokerage firms have authority to vote customers’ unvoted shares held by the firms in street name on Proposal 4. If a broker does not exercise this authority, such broker non-votes will have no effect on the outcome of Proposal 4.

 

Solicitation of Proxies

 

We will bear the entire cost of solicitation of proxies, including preparation, assembly and mailing of this Proxy Statement, the proxy, the Notice and any additional information furnished to stockholders. Copies of solicitation materials will be furnished to banks, brokerage houses, fiduciaries and custodians holding shares of our Common Stock in their names that are beneficially owned by others to forward to those beneficial owners. We may reimburse persons representing beneficial owners for their costs of forwarding the solicitation materials to the beneficial owners. Original solicitation of proxies may be supplemented by telephone, facsimile, electronic mail or personal solicitation by our directors, officers or staff members. No additional compensation will be paid to our directors, officers or staff members for such services.

 

A list of stockholders entitled to vote at the Annual Meeting will be available for examination by any stockholder for any purpose germane to the Annual Meeting during ordinary business hours at our executive offices located at 5081 Howerton Way, Suite A, Bowie, Maryland 20715 for ten days prior to the Annual Meeting and also during the Annual Meeting by shareholders who attend the Annual Meeting through the live webcast.

 

Annual Report

 

Our Annual Report on Form 10-K for the year ended December 31, 2023, as amended by our Form 10-K/A filed with the SEC on April 26, 2024 (our “Annual Report”), which contains the consolidated financial statements of our company for the year ended December 31, 2023, accompanies this Proxy Statement, but is not a part of our company’s soliciting materials.

 

Stockholders may obtain, without charge, a copy of our Annual Report filed with the SEC, including the financial statements and schedules thereto, without the accompanying exhibits, by writing to: Corporate Secretary, Blink Charging Co., 5081 Howerton Way, Suite A, Bowie, Maryland 20715. Our Annual Report is also available online at our company’s website at https://ir.blinkcharging.com/sec-filings/all-sec-filings. A list of exhibits is included in our Annual Report and exhibits are available from our company upon the payment to us of the cost of furnishing them.

 

Delinquent Section 16(a) Reports

 

Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), requires our executive officers, directors and holders of more than 10% of our Common Stock to file with the SEC initial reports of ownership and reports of changes in ownership of our Common Stock. Such persons are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file.

 

Based solely upon our review of the copies of such forms received by us, or representations from certain reporting persons that no year-end Forms 5 were required for those persons, we believe that, during the year ended December 31, 2023, all filing requirements applicable to our executive officers, directors and greater than 10% beneficial owners were complied with, except for one late Form 4 filing by Harjinder Bhade which included two late transactions.

 

6
 

 

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

 

Board of Directors

 

Our business is managed under the direction of the Board of Directors (the “Board”). The Board meets on a regularly scheduled basis during our fiscal year to review significant developments affecting our company and to act on matters requiring Board approval. The Board also holds special meetings when an important matter requires Board action between scheduled meetings and also acts by unanimous written consent when necessary and appropriate. The Board has four fixed regular meetings per year scheduled in accordance with the filing of periodic reports with the SEC. The Board met 21 times during the year ended December 31, 2023. In addition, the Board of Directors took action 13 times during 2023 by unanimous written consent in lieu of a meeting, as permitted by applicable law. During 2023, each member of the Board attended or participated in 75% or more of the aggregate of the total number of meetings of the Board and committees on which they served during the period for which such director was serving as a director. We, and the Board, expect all current directors to attend our annual meetings of stockholders barring unforeseen circumstances or irresolvable conflicts. We do not have a written policy on Board attendance at annual meetings of stockholders; however, we do schedule a Board meeting immediately after the annual meeting for which members attending receive compensation. All of the Board members attended last year’s annual meeting in person or by telephonic conference call.

 

The 2024 nominees to serve on the Board and each of its current committees are as follows:

 

Name   Age  

Director

Since

 

Principal

Occupation

 

Audit

Committee

 

Compensation

Committee

 

Nominating

and ESG

Committee

 

Government

Affairs

Committee

Ritsaart J.M. van Montfrans   52   2019   Chief Executive Officer of Incision Group   X   X (Chair)   X   X
Brendan S. Jones   60   2021   President and Chief Executive Officer of Blink               X
Aviv Hillo   59   2023   General Counsel and Executive Vice President – M&A of Blink                
Jack Levine   73   2019   President of Jack Levine, PA   X (Chair)   X   X    
Kristina A. Peterson   60   2023   Chief Executive Officer of Mayflower Partners   X       X (Chair)    
Cedric L. Richmond   50   2022   President of Richmond & Company, LLC        X    X   X (Chair)

 

Board Leadership

 

Brendan S. Jones has been our President and a director since February 2021 and our Chief Executive Officer since May 2023. Ritsaart J.M. van Montfrans has been a director since December 2019 and our Chairman of the Board since May 2023. We believe that having a Chief Executive Officer and an independent Chairman, each with distinct responsibilities, works well for us because all but three of our directors are independent, and our Chairman can cause the independent directors to meet in executive sessions at any time. Therefore, the Chairman can at any time bring to the attention of a majority of the directors any matters he thinks should be addressed by our Board. Other advantages to having an independent director serve as Chairman include facilitating relations among our Board, Chief Executive Officer and other senior management, assisting our Board in reaching consensus on particular strategies and policies, fostering robust evaluation processes, supporting the efficient allocation of oversight responsibilities between the independent directors and management, and enhancing stockholders’ confidence in our company’s governance practices.

 

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The Chairman presides over Board meetings and presides at all meetings of our independent directors. The Chairman’s additional duties include:

 

  at the request of our Board, presiding over meetings of stockholders;
  conveying recommendations of the independent directors to the full Board;
  serving as a liaison between our Board and management;
  ensuring that members of our Board receive accurate, timely and clear information, in particular about our company’s performance, to enable our Board to make sound decisions and provide effective oversight and advice to promote the success of our company;
  monitoring effective implementation of our Board’s decisions;
  establishing and maintaining a close relationship of trust with our Chief Executive Officer by providing support and advice while respecting executive responsibility and leadership;
 

developing the Board by leading the effort to identify and recruit new Board members; and

 

leading succession efforts.

 

Four of our Board nominees are independent. In addition, all of the current directors on each of the Audit Committee, Compensation Committee, Nominating and ESG Committee and Government Affairs Committee are independent directors, with the exception of Messrs. Jones and Reddy on the Government Affairs Committee, and each of these committees is led by an independent committee chair. The committee chairs set the agendas for their committees and report to the full Board on their work. As required by Nasdaq, our independent directors meet in executive sessions without management present as frequently as they deem appropriate, typically at the time of each regular in-person Board meeting. All of our independent directors are highly accomplished and experienced business people in their respective fields, who have demonstrated leadership in significant enterprises and are familiar with Board processes. Our independent directors bring experience, oversight and expertise from outside our company and industry, while Messrs. Jones and Hillo bring company-specific experience and expertise. Mr. Reddy will not be standing for reelection at this Annual Meeting.

 

Director Qualifications and Diversity

 

Our Nominating and ESG Committee is responsible for the review of corporate governance, identifying and reviewing the composition of and evaluate the performance of the Board; recommend persons for election to the Board and evaluate director compensation; review the composition of committees of the Board and recommend persons to be members of such committees; review and maintain compliance of committee membership with applicable regulatory requirements; and review conflicts of interest of members of the Board and corporate officers. The committee may use outside consultants to assist in identifying candidates and will also consider advice and recommendations from stockholders, management, and others as it deems appropriate.

 

When evaluating director nominees, our directors consider the following factors:

 

  the current size and composition of the Board and the needs of the Board and the respective committees of the Board;
     
  such factors as character, integrity, judgment, diversity of experience, independence, area of expertise, corporate experience, length of service, potential conflicts of interest, other commitments and the like;
     
  business experience, diversity and personal skills in technology, finance and financial reporting, marketing and international business; and
     
  other factors that the directors may consider appropriate.

 

Our goal is to assemble a Board that brings together a variety of skills derived from high quality business and professional experience.

 

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The matrix below provides certain highlights of the composition of our Board members based on self-identification. Each term used in the matrix below has the meaning given to it in Nasdaq Listing Rule 5605(f).

 

Board Diversity Matrix (As of June 3, 2024)
Board Size
Total Number of Directors   7
    Female   Male   Non-Binary   Did Not Disclose Gender
Gender Identity
Directors   1   5   -   -
Demographic Background
African American or Black     1   -   -
Alaskan Native or Native American       -   -
Asian       -   -
Hispanic or Latinx       -   -
Native Hawaiian or Pacific Islander       -   -
White   1   4   -   -
Two or More Races or Ethnicities       -   -
LGBTQ+   -
Did Not Disclose Demographic Background   -

 

Board Committees and Charters

 

The Board has four standing committees - Audit Committee, Compensation Committee, Nominating and ESG Committee and the Government Affairs Committee. The Board maintains charters for each of these standing committees. To view the charters of our standing Board committees, please visit our website at https://ir.blinkcharging.com/corporate-governance/governance-documents.

 

Audit Committee

 

Our Audit Committee is currently comprised of Jack Levine (chair), Ritsaart J.M. van Montfrans and Kristina A. Peterson. Our Board has determined that each of the directors serving on the Audit Committee meets the requirements for financial literacy under applicable rules and regulations of the SEC and Nasdaq. In addition, our Board has determined that Mr. Levine meets the requirements of a financial expert as defined under the applicable rules and regulations of the SEC and has the requisite financial sophistication as defined under the applicable rules and regulations of Nasdaq. Our Board has considered the independence and other characteristics of each existing member and each proposed member of our Audit Committee, and our Board believes that each member meets the independence and other requirements of Nasdaq and the SEC. Our Audit Committee operates under a written charter that satisfies the applicable standards of the SEC and Nasdaq.

 

Our Audit Committee, among other things, is responsible for:

 

  selecting and hiring the independent registered public accounting firm to audit our financial statements;
     
  helping to ensure the independence and performance of the independent registered public accounting firm;
     
  approving audit and non-audit services and fees;
     
  reviewing financial statements and discussing with management and the independent registered public accounting firm our annual audited and quarterly financial statements, the results of the independent audit and the quarterly reviews, and the reports and certifications regarding internal controls over financial reporting and disclosure controls;

 

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  preparing the Audit Committee report that the SEC requires to be included in our annual proxy statement;
     
  reviewing reports and communications from the independent registered public accounting firm;
     
  reviewing earnings press releases and earnings guidance;
     
  reviewing the adequacy and effectiveness of our internal controls and disclosure controls and procedures;
     
  reviewing our policies on risk assessment and risk management;
     
  reviewing related party transactions;
     
  establishing and overseeing procedures for the receipt, retention and treatment of accounting related complaints and the confidential submission by our employees of concerns regarding questionable accounting or auditing matters; and
     
  reviewing and monitoring actual and potential conflicts of interest.

 

During 2023, the Audit Committee met five times.

 

Cyber Security

 

Cybersecurity is an integral part of our risk management processes and a significant area of focus for the Board of Directors and management team. The Audit Committee is responsible for the cybersecurity component of our IT operations, and the Audit Committee reviews the status of ongoing efforts and incidents at every Board of Directors meeting. In addition to our Board-level Audit Committee, management implemented a Cybersecurity Committee comprised of representatives of senior management, Legal, Marketing, Technology, and Operations to maintain and improve our cybersecurity strategy based on most current industry developments and recent incidents as needed. The Cybersecurity Committee formal meeting occurs biannually, with less formal status update meetings happening more often and as necessary. The members of the Cybersecurity Committee have prior work experience in various roles involving information technology, including security, auditing, compliance, systems and programming. These individuals are informed about, and monitor the prevention, mitigation, detection and remediation of cybersecurity incidents through their management of, and participation in, the Cybersecurity Committee, and report to the Audit Committee on any appropriate items.

 

Compensation Committee

 

Our Compensation Committee is currently comprised of Ritsaart J.M. van Montfrans (chair), Jack Levine and Cedric L. Richmond. Our Board has considered the independence and other characteristics of each current and anticipated member of our Compensation Committee. Our Board believes that each member of our Compensation Committee meets the requirements for independence under the current requirements of Nasdaq, is a nonemployee director as defined by Rule 16b-3 promulgated under the Exchange Act, and is an outside director as defined pursuant to Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”).

 

Our Compensation Committee operates under a written charter that satisfies the applicable rules and regulations of the SEC and the listing standards of Nasdaq.

 

Our Compensation Committee is, among other things, responsible for:

 

  reviewing, approving and determining, or making recommendations to our Board regarding, the compensation of our executive officers, including our Chief Executive Officer and other executive officers;
     
  administering our incentive compensation plans and programs;
     
  reviewing and discussing with our management our SEC disclosures; and
     
  overseeing our submissions to stockholders on executive compensation matters.

 

During 2023, the Compensation Committee met 30 times.

 

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Nominating, Environmental, Social and Governance Committee

 

Blink’s business and product roadmap are designed to support the global energy transition to low/no carbon transportation solutions. By providing clean electric vehicle charging solutions to corporations, other organizations and individual consumers, Blink’s products and solutions are designed to significantly lower harmful criteria pollutants and reduce global greenhouse gas emissions. In July 2023, we combined our Nominating and Corporate Governance Committee and our Environmental, Social and Governance Committee into the Nominating, Environmental, Social and Governance Committee (or Nominating and ESG Committee).

 

Board Oversight of ESG

 

The Nominating and ESG Committee of the Board is currently comprised of three independent directors: Kristina A. Peterson (Chair), Jack Levine and Cedric L. Richmond. Our Nominating and ESG Committee operates under a written charter to reflect updated SEC disclosure requirements and corporate governance best practices. All of Blink’s Committee Charters (Nominating and ESG, Compensation, Audit, Government Affairs) and our Code of Business Conduct and Ethics were updated in May 2024 to comply with updated SEC disclosure requirements and evolving corporate governance best practices and are posted on our website.

 

The Committee ensures that we meet our ongoing sustainability goals and promote socially responsible practices within our company. This committee underscores our dedication to sustainability and acknowledges that responsible business conduct is crucial for sustained success. Through the Committee’s efforts, we aim to make meaningful contributions to society and the environment while also delivering value to our stakeholders.

 

The principal ESG responsibilities and duties of the Nominating, Environmental, Social and Governance Committee are to:

 

  recommend to the Board our overall general strategy concerning sustainability, environmental stewardship, health and safety, corporate social responsibility, philanthropy, diversity, equity and inclusion, community issues, and other public policy matters relevant to our company;
     
  oversee our policies, practices and performance and manage disclosures with respect to ESG matters; and
     
  report to the Board current and emerging topics relating to ESG matters that may affect the business, operations, performance or public image of our company or are pertinent to us and our stakeholders in support of our evolving global business.

 

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Organizational Structure for Managing ESG

 

During 2023, the Board’s Nominating and ESG Committee met one time formally. Internally, environmental, social and governance risks and opportunities are managed by the Legal Department. Blink’s cross-functional global Sustainability Committee reports to the Board Nominating and ESG Committee and is composed of the Director of Sustainability, the General Counsel, Chief Marketing Officer, and ESG-focused managers in the U.S., UK, EU and India, and meets at least bi-weekly year-round.

 

The Director of Sustainability, Reed S. Fuller, is Blink’s Corporate Secretary and Assistant General Counsel, reporting to the General Counsel, and plays a crucial role in overseeing and driving our sustainability initiatives. The Director ensures the integration of sustainable practices into our corporate strategy, identifies risk and improvement areas, and implements initiatives in alignment with our ESG goals. Serving as a liaison with the Nominating and ESG Committee Chair, the Director of Sustainability facilitates communication and reporting on our sustainability progress, steering our organization towards a more sustainable future.

 

With input from the global Sustainability Committee, Blink plans to publish a 2024 Corporate Sustainability Report. In order to prepare for the European Union’s Corporate Sustainability Reporting Directive (CSRD) being implemented beginning in 2025 and requiring detailed reporting related to environmental, social, and governance reporting from companies operating in the EU, we plan to undertake an enterprise-level Double Materiality Assessment (DMA) as a necessary action to ensure compliance in relevant operations locations. The DMA will cover climate-related financial risks material to the company’s operations and future, and social and environmental impacts material within the company’s operations.

 

As part of planning for our first published Corporate Sustainability Report, Blink continues to improve its ESG efforts and activities across the globe, which include the following 2023 Impact and Sustainability Program Highlights:

 

Environmental

 

We are committed to implementing sustainable practices across our operations. By prioritizing environmental responsibility, we aim to contribute to a more sustainable future for our planet and society.

 

  Blink’s Environmental Management Systems leads report directly to the Board and CEO

 

Aviv Hillo and Jenifer Yokley share joint management supervision of the Sustainability Committee and ESG programs, respectively, and each report directly to the CEO and to the Chair of the Nominating and ESG Committee of the Board.

 

  ISO 9001, 14001, and 45001 certifications in the U.S., UK and India

 

Blink’s UK and India operations are certified with environmental management systems ISO 14001 (both within Integrated Management Systems with ISO 9001 and 45001). Additionally, Blink’s U.S. Bowie, Maryland production facility is also ISO 9001 compliant, under certified Integrated Management Systems, as disclosed on our corporate website.

 

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  Supplier Code of Conduct and Conflict Minerals Policy

 

Blink Charging has adopted the Responsible Business Alliance (RBA) Code of Conduct. The RBA Code of Conduct (“Code of Conduct”) is applicable to both the Company and our suppliers and mirrors our commitment to ethical business practices, including labor rights, environmental responsibility, health and safety, and ethical sourcing. By implementing this Code of Conduct, we are holding ourselves and our suppliers to the highest standards of accountability and sustainability. We believe that responsible business practices are not only the right thing to do, but also critical to the long-term success and well-being of our Company, our suppliers, and the communities in which we operate. Blink requires its suppliers to be in compliance with the Code of Conduct. Blink’s Supplier Code of Conduct is published on our corporate website.

 

We also announced Blink’s Conflict Minerals Policy in 2024, which can be found on our website, and continue to work with suppliers to enhance our conflict minerals program.

 

  Blink Employee Electric Vehicle (EV) Incentives

 

Globally, Blink employees are offered incentives if they own or lease an EV, hybrid plug-in, or electric scooter. In Blink’s U.S. Bowie, Maryland office, free EV charging is available to employees. Blink Europe entities own and lease a fleet of fully battery electric vehicles (BEV) (including vans). In the UK, Blink is certified as an ultra-low-emission vehicle (ULEV) Fleet Operator.

 

  Greenhouse Gas Emissions (GHG)/Scope 1, 2, 3 Benchmarking and Reporting

 

Blink UK has a published Carbon Reduction Plan. Blink’s European group is underway with its GHG Emissions/Carbon Footprint benchmarking program, in order to receive its Planet Mark Business Certification (Scope 1, 2 and a subset of Scope 3), with a view to setting verified near-term targets. Additionally, in our European operations, no additional burning oils or gases are utilized for heating in leased office or warehouse premises.

 

  Waste Management

 

Blink has identified waste management as its primary focus area in its Environmental Impact Strategy, as part of its Global ESG Program (formed in 2024). Regional programs are in place to minimize and mitigate waste in offices, packaging, production, logistics and installation operations covering:

 

Terracycle boxes for hard-to-recycle packaging (with signed public commitments not to mix waste streams),
Nespresso pod (coffee) recycling,
Separated recycling: card & paper, glass, plastics, metals,
Printer toner cartridge recycling,
Pallet system used to minimize waste in parcel deliveries (UK & EU),
IT Departments – electronic equipment recycling and refurb program and donation to schools and community groups in place,
In the EU operations, all hazardous waste is handled by licensed carriers and complies with WEEE directives.
In our Belgium operations, Blink contracst with a third-party recycling provider, dismantling used units for component parts, as well as recycling and repurposing unused, older units for other uses at trade shows.
In 2024, Blink’s Global ESG Program is establishing an end-of-life treatment program for hardware across operating systems.
In 2024 Blink’s Global ESG Program is establishing a packaging waste procedure.

 

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  Energy Conservation

 

Across its European operations, Blink’s offices have installed LED and ambient lighting, with motion sensors for efficient electricity consumption. In 2024, water conservation faucets, legionella testing and Indoor Air Quality Monitoring have been added to further enhance the working environment for employee well-being and reduced environmental impact. Blink is planning to implement further conservation measures and targets across its global operations.

 

Social

 

By prioritizing social responsibility, we aim to create value for our stakeholders while also contributing to a more just and equitable society.

 

  Employee Wages and Pay Equity

 

When hiring and promoting employees, Blink Human Resources checks proposed salaries against comparable wage market values for each role. When appropriate, Blink makes adjustments across departments, such as customer service, as the comparable market values for each role rises. In the UK, Blink is compliant with the government-mandated National Living Wage requirements for all employees, including interns and apprentices, as well as wage and market benchmarking requirements applied across all EU operations. In the U.S. and in other locations, Blink is compliant with all government, federal and state-mandated wage requirements.

 

  Human Rights training

 

Modern Slavery and Forced Labour training is undertaken annually in our UK operations.

 

  Employee Surveys

 

Blink conducts approximately three employee surveys per year. These surveys include an employee engagement survey, an employee benefits survey, and a DEI survey. Based on feedback from a recent employee benefits survey, Blink switched the Company’s chosen dental and vision plans to better suit employee needs. Another result from the same survey prompted Blink to further develop wellness plans for employees. The employee engagement survey is provided to the Board of Directors to report on overall company satisfaction, for their consideration on further action. The recent DEI survey is under review for next step implementations focusing on diversity, based on requests and feedback received.

 

Governance

 

We strive for accountability, transparency, and integrity across our operations to build long-term value for stakeholders and foster trust with customers, partners, and the community. The Blink Board of Directors engages in continuing education in order to remain up to date regarding good corporate governance practices involving evolving disclosure requirements, succession planning, business ethics and compliance, anti-bribery and corruption, and political contributions and lobbying practices.

 

  Board Continuing Education and Membership in Relevant Governance-Related Organizations

 

Blink holds a Board Membership with the National Association of Corporate Directors (NACD), the leading U.S. independent non-profit membership organization of corporate board members that provides governance guidelines to assist directors in discharging their responsibilities and ensuring their commitment to the highest standards of corporate conduct. Our CEO, CFO, COO, General Counsel, Assistant General Counsel and all independent directors are NACD members. Jack Levine, Audit Chair, is a member of the Association of Audit Committee Members Inc., a non-profit association of audit committee members dedicated to strengthening the audit committee by developing national best practices for corporate governance, corporate compliance and internal whistleblower policies. Kristina A. Peterson, Chair, Nominating and ESG Committee, has held the Women Corporate Directors Foundation (WCD) San Diego Chapter Co-Chair position since 2016. WCD is the leading non-profit organization for female directors, sponsored by KPMG with 2,500 corporate director members across 8,500 corporate boards and 70 Global Chapters.

 

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  Board Director Nominees and Succession Planning

 

The Nominating and ESG Committee, composed of Independent Directors of our Board, reviews candidates, makes recommendations to the Board to nominate new directors and manages the board succession planning process. We also consider any nominations of director candidates validly made by our stockholders. When evaluating director nominees, the Committee considers the following factors:

 

  the current size and composition of the Board and the needs of the Board and the respective committees of the Board;
     
  such factors as character, integrity, judgment, diversity of experience, independence, area of expertise, corporate experience, length of service, potential conflicts of interest, other commitments and the like;
     
  business experience, diversity and personal skills in technology, finance and financial reporting, marketing and international business; and
     
  other factors that the directors may consider appropriate.

 

Our goal is to assemble a Board that brings together a variety of skills derived from high quality business and professional experience.

 

While we do not have a formal diversity policy for Board membership, the Board does seek to ensure that its membership consists of sufficiently diverse backgrounds, meaning a mix of backgrounds and experiences that will enhance the quality of the Board’s deliberations and decisions. In considering candidates for the Board, the Committee considers, among other factors, diversity with respect to viewpoints, skills, experience and other demographics.

 

  Business Ethics and Compliance

 

The Code of Business Conduct and Ethics applies to Blink Charging, Inc. and its subsidiaries and their employees, corporate officers and directors, as well as third-party contractors, and can be found on our corporate website. Key aspects of our Code of Business Conduct and Ethics include:

 

Anti-bribery and Corruption (ABC) Training

 

All Blink employees undertake anti-bribery and corruption training through the KnowBe4 platform during induction and through annual updates. In 2023, some of these trainings included “Global Anti-Bribery and Corruption” and “Ethics and Code of Conduct: Introduction. Additional similar training is planned for 2024. Aviv Hillo, General Counsel and Executive Vice President of Mergers & Acquisitions, and Board Member oversees Blink’s ABC program.

 

Political Contributions and Lobbying

 

Blink’s Legal Department and the Board’s Government Affairs Committee oversees current policies with regard to political contributions, political advocacy and lobbying, and these policies are enclosed in the Blink Employee Handbook and the Government Affairs Committee Charter. Political contributions are prohibited to be made to state candidates directly from corporate funds. Current federal law prohibits direct corporate contributions to candidates for federal office. Employee political action committees (PACs), however, may make contributions to federal candidates using funds voluntarily given by employees. Campaign finance laws vary by state. A10 Associates has been engaged to lobby for Blink at the federal level with Congress and the Administration. Matt Chen, Director of Government Affairs, is a registered federal lobbyist and a registered Maryland lobbyist. The monetary values of Blink’s lobbying activities vary from quarter to quarter based on the amount of time spent and compensation and are fully disclosed in Blink’s relevant ongoing SEC filings.

 

Government Affairs Committee

 

In January 2023, our Board established a Government Affairs Committee, which began as a separate standing committee of the Board on January 31, 2023. The principal responsibilities and duties of this committee are to (i) to provide oversight and guidance to management with respect to the company’s government affairs strategy and initiatives, (ii) to ensure that the company’s government affairs activity reflects an honest and open communication with government and community decision-makers, (iii) to inform the Board in a timely manner of significant government affairs issues and proceedings that could have an effect on the company and (iv) to brief the Board at least quarterly regarding the company’s performance of its government affairs activity. Additional information regarding the functions to be performed by the Government Affairs Committee is set forth in the Government Affairs Committee Charter.

 

The Government Affairs Committee is currently comprised of Cedric L. Richmond (chair), Brendan S. Jones, Ritsaart J.M. van Montfrans and Mahidhar (Mahi) Reddy. The committee includes two management directors. Mr. Reddy will not be standing for reelection at this Annual Meeting.

 

During 2023, the Government Affairs Committee met one time.

 

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Board Role in Risk Oversight

 

Risk assessment and oversight are integral parts of our governance and management processes. Our Board does not have a standing risk management committee, but rather administers this oversight function directly through our Board as a whole, as well as through various standing committees of our Board that address risks inherent in their respective areas of oversight.

 

Our Board oversees an enterprise-wide approach to risk management, which is designed to support the achievement of the company’s objectives, including the strategic objective to improve long-term financial and operational performance and enhance stockholder value. Our Board believes that a fundamental part of risk management is understanding the risks that we face, monitoring these risks and adopting appropriate control and mitigation of these risks.

 

The Board discusses risks with our senior management on a regular basis, including as a part of its strategic planning process, annual budget review and approval, and thorough reviews of compliance issues in the appropriate committees of our Board. While the Board has the ultimate oversight responsibility for the risk management process, various committees of the Board are structured to oversee specific risks, as follows:

 

Committee   Primary Risk Oversight Responsibility
Audit Committee   Oversees financial risk, including capital risk, financial compliance risk, internal controls over financial reporting and reporting of violations involving financial risk, internal controls and other non-compliance with our Code of Business Conduct and Ethics.
     
Compensation Committee   Oversees our compensation policies and practices to ensure compensation appropriately incentivizes and retains management and determines whether such policies and practices balance risk-taking and reward in an appropriate manner.
     
Nominating, Environmental, Social and Governance Committee   Oversees the assessment of each Board member’s independence to avoid conflict, determine the effectiveness of the Board and committees, and maintain good governance practices through our corporate governance guidelines, Committee charters and Code of Business Conduct and Ethics. Oversees our policies and practices, and reviews our reporting standards, with respect to complying with evolving ESG matters and disclosures.
     
Government Affairs Committee   Oversees our policies and practices with respect to our government affairs strategy and initiatives.

 

The Board also considers our internal control structure which, among other things, limits the number of persons authorized to execute material agreements, requires approval of our Board for matters outside of the ordinary course and includes our Whistleblower Policy. This policy establishes procedures for the submission by our employees and consultants, on a confidential and anonymous basis, of complaints and concerns regarding our financial statement disclosures, accounting practices, internal controls or auditing matters, or possible violations of the federal securities laws or the rules or regulations promulgated thereunder. Complaints submitted through the Whistleblower Policy are promptly routed to the chair of our Audit Committee.

 

Code of Business Conduct and Ethics

 

Our Code of Business Conduct and Ethics applies to all our employees, officers and directors, including our principal executive and senior financial officers, and was updated in May 2024. A copy of our Code of Business Conduct and Ethics (2023 version) is posted on our website at www.blinkcharging.com. We intend to disclose future amendments to certain provisions of our Code of Conduct and Business Ethics, or waivers of these provisions with respect to executive officers on our website or in our public filings with the SEC. There were no waivers of the Code of Business Conduct and Ethics in 2023. A copy of our Code of Business Conduct and Ethics will be provided without charge to any person submitting a written request to the attention of the Chief Executive Officer at our principal executive office.

 

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Responsible Business Alliance Code of Conduct for Suppliers

 

In April 2023, we adopted the Responsible Business Alliance (“RBA”) Code of Conduct for Suppliers. Since adopting the RBA Code of Conduct, we have started to integrate its elements into our processes, including auditing strategic suppliers and conducting internal assessments to confirm that we are addressing all aspects of responsible supply chain management. All of our manufacturing suppliers are required to comply with the RBA Code of Conduct and associated Blink policies.

 

We expect our suppliers to maintain progressive employment, environmental, health, safety and ethical practices that meet or exceed applicable laws and the RBA Code of Conduct. We seek to promote human rights throughout our supply chain and expect our suppliers to respect human rights whenever they provide products or services for us.

 

Director Independence

 

At least annually, the Nominating, Environmental, Social and Governance Committee reviews the independence of each non-employee director and makes recommendations to the Board and the Board affirmatively determines whether each director qualifies as independent. No director qualifies as “independent” unless the Board affirmatively determines that the director has no material relationship with our company (either directly or as a stockholder or officer of an organization that has a relationship with the company). In addition, in affirmatively determining the independence of any director who will serve on the Compensation Committee, the Board must consider all factors specifically relevant to determining whether a director has a relationship to the company which is material to that director’s ability to be independent of management in connection with the duties of a Compensation Committee member. Each director must keep the Nominating, Environmental, Social and Governance Committee fully and promptly informed as to any development affecting a director’s independence.

 

Our shares of common stock are listed for trading on The Nasdaq Capital Market. Under the rules of Nasdaq, “independent” directors must make up a majority of a listed company’s board of directors. In addition, applicable Nasdaq rules require that, subject to specified exceptions, each member of a listed company’s audit and compensation committees be independent within the meaning of the applicable Nasdaq rules. Audit Committee members must also satisfy the independence criteria set forth in Rule 10A-3 under the Exchange Act.

 

The Board has determined that each of our non-employee directors that served during 2023 (Messrs. Buffalino, Levine, Marks, van Montfrans and Richmond, and Ms. Peterson) were independent under the listing standards of Nasdaq and the requirements of the SEC. Messrs. Jones, Hillo and Reddy are not independent based on their current service as employees of our company. During 2023, Michael D. Farkas was not independent based on his service as an officer of our company. In making its independence determinations, the Board reviewed direct and indirect transactions and relationships between each director, or any member of his or her immediate family, and us or one of our subsidiaries or affiliates based on information provided by the director, our records and publicly available information. None of our directors directly or indirectly provides any professional or consulting services to us.

 

As a result, a majority of our directors are independent, as required under applicable Nasdaq rules. As required under applicable Nasdaq rules, we anticipate that our independent directors will meet in regularly scheduled executive sessions at which only independent directors are present.

 

Communication with the Board

 

Our Annual Meeting of Stockholders provides an opportunity each year for stockholders to ask questions of, or otherwise communicate directly with, members of the Board on appropriate matters. In addition, any interested party may communicate in writing with any particular director, including our Chairman, any committee of the Board, or the directors as a group, by sending such written communication to our Corporate Secretary at our executive offices located at Blink Charging Co., 5081 Howerton Way, Suite A, Bowie, Maryland 20715. Copies of written communications received at such address will be provided to the Board or the relevant director unless such communications are considered, in the reasonable judgment of our Corporate Secretary, to be inappropriate for submission to the intended recipient(s). The Corporate Secretary or his designee may analyze and prepare a response to the information contained in communications received and may deliver a copy of the communication to other company staff members or agents who are responsible for analyzing or responding to complaints or requests. Communications concerning potential director nominees submitted by any of our stockholders will be forwarded to the chair of the Nominating, Environmental, Social and Governance Committee.

 

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Related Party Transaction Policy

 

Our policy with regard to related party transactions is for the Board as a whole to approve any material transactions involving our directors, executive officers or holders of more than five percent (5%) of our outstanding shares of Common Stock.

 

Certain Relationships and Related Transactions

 

In addition to the compensation arrangements, including employment, termination of employment and change in control arrangements, discussed in the section titled “Executive Compensation,” the following is a description of each transaction since January 1, 2023 and each currently proposed transaction in which:

 

  we have been or are to be a participant;
     
  the amount involved exceeds $120,000; and
     
  any related person had or will have a direct or indirect material interest.

 

Certain persons who provided services to us, including Michael D. Farkas, our former Executive Chairman and Chief Executive Officer, and Aviv Hillo, our General Counsel and Executive Vice President of Mergers & Acquisitions, also provided services and/or served as officers or directors of Balance Labs, Inc., a consulting firm controlled by Mr. Farkas that provides business development and consulting services to startup development-stage businesses. Mr. Farkas ceased being an officer of our company in May 2023 and a director of our company in July 2023. Mr. Hillo resigned as a director of Balance Labs, Inc. in July 2023.

 

Hedging and Pledging Policies

 

Blink maintains a policy on insider trading and compliance that prohibits our directors, officers and employees from directly or indirectly purchasing or using financial instruments designed to hedge or offset any decrease in the market value of Blink securities that they own. In addition, under such policy, Blink directors, officers and employees are prohibited from pledging Blink securities as collateral.

 

Director and Executive Officer Indemnification Agreements

 

Nevada corporation law limits or eliminates the personal liability of directors to corporations and their stockholders for monetary damages for breaches of directors’ fiduciary duties as directors. Our Bylaws include provisions that require the company to indemnify our directors or officers against monetary damages for actions taken as a director or officer of our company. We are also expressly authorized to carry sufficient directors’ and officers’ insurance to protect our directors, officers, employees and agents for certain liabilities. Our Articles of Incorporation do not contain any limiting language regarding director immunity from liability.

 

We have entered or intend to enter into separate indemnification agreements with all of our directors and executive officers, in addition to indemnification provided for in our Bylaws. These agreements, among other things, provide for indemnification of our directors and executive officers for certain expenses, judgments, fines and settlement amounts, among others, incurred by such person in any action or proceeding arising out of such person’s services as a director or executive officer in any capacity. We believe that these provisions in our Bylaws and indemnification agreements are necessary to attract and retain qualified persons as directors and executive officers.

 

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Insofar as indemnification for liabilities arising under the Securities Act of 1933, as amended (the “Securities Act”), may be permitted to directors, officers or persons controlling our company pursuant to the foregoing provisions, we have been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

 

Corporate Governance Materials Available on the Blink Website

 

Our corporate governance principles are intended to provide a set of flexible guidelines for the effective functioning of the Board and are reviewed regularly and revised as necessary or appropriate in response to changing regulatory requirements, evolving best practices and other considerations. Many of these principles and policies relating to corporate governance at Blink are available on the governance section of our website, https://ir.blinkcharging.com/corporate-governance/governance-documents, including:

 

  Audit Committee Charter
     
  Compensation Committee Charter
     
  Nominating, Environmental, Social and Governance Committee Charter
     
  Government Affairs Committee Charter
     
  Code of Business Conduct and Ethics

 

You may obtain copies of these materials, free of charge, by sending a written request to: Corporate Secretary, Blink Charging Co., 5081 Howerton Way, Suite A, Bowie, Maryland 20715. Please specify which documents you would like to receive.

 

Non-Director Executive Officers

 

Our non-director executive officers are listed below. For biographical information about Messrs. Jones and Hillo, please refer to our company’s Board nominees under Proposal 1 of this Proxy Statement.

 

Name, Age and Principal Occupations

 

Michael P. Rama, 58, has served as our Chief Financial Officer since February 2020. Prior to joining us, Mr. Rama was an independent financial consultant (not associated with Blink) from July 2019 until he joined us on February 10, 2020. Mr. Rama served as the Vice President and Chief Financial Officer of NV5 Global, Inc., a Nasdaq Capital Markets-traded company that provides professional and technical engineering and consulting solutions for public and private sector clients in the infrastructure, energy, construction, real estate and environmental markets, from September 2011 to June 2019. At NV5 Global, Mr. Rama was responsible for all accounting, finance and treasury functions and the company’s SEC reporting. From October 1997 until August 2011, Mr. Rama held various accounting and finance roles with AV Homes, Inc. (formerly known as Avatar Holdings, Inc.), including as principal financial officer, chief accounting officer and controller. Mr. Rama has more than 20 years of experience with SEC compliance, establishment and maintenance of internal controls, and capital markets and acquisition transactions. Mr. Rama earned a Bachelor of Science degree in accounting from the University of Florida and is a Certified Public Accountant.

 

Harjinder Bhade, 60, has served as our Chief Technology Officer since May 2021, where he is responsible for the maintenance of the Blink network and the development of our EV products. He was previously the Chief Technology Officer and Senior Vice President of Engineering at ENGIE North America Inc. (which acquired Green Charge Networks), a sustainable energy storage as a service company, from October 2014 to May 2021. Prior to that, Mr. Bhade was a founder and served as Vice President of Software Engineering at ChargePoint, a global EV charging infrastructure company, from November 2007 to September 2014, where he played a key role in that company’s product development. Mr. Bhade served on ChargePoint’s Advisory Board from September 2014 to May 2021. Mr. Bhade served as the Senior Director of Software Engineering of Carrier Ethernet Solutions at Lucent Technologies from May 2006 to April 2007, the Director of Software Engineering at Riverstone Networks (which was acquired by Lucent Technologies) from January 2003 to May 2006, and the Founder and Director of Software Engineering at Pipal Systems from November 2001 to January 2003. Mr. Bhade received a B.S. degree in computer science from California State University, Chico and an M.B.A. degree from the University of Phoenix.

 

Michael C. Battaglia, 53, joined our company in July 2020 as the Vice President of Sales. In January 2021, Mr. Battaglia was promoted to Senior Vice President of Sales and Business Development and, in December 2022, he was promoted to Chief Revenue Officer of our company. In September 2023, Mr. Battaglia was appointed to serve as our Chief Operating Officer. Prior to joining our company, Mr. Battaglia served in various management positions for J.D. Power & Associates from March 2006 to July 2020, assisting dealerships and automotive OEMs improve operations by utilizing data-driven insights and conducting comprehensive analyses. Mr. Battaglia is an automotive and EV charging veteran with more than 25 years of experience in the industry and has expertise in building high performing sales and operations teams. Throughout his time with our company, Mr. Battaglia has worked closely with the operations teams to streamline systems and processes related to order processing and fulfillment, customer support structures, and new product procurement, which has led to increases in our operational efficiency. Mr. Battaglia led the effort to implement Salesforce CRM, tying together field service and accounting functions globally for our company. Additionally, Mr. Battaglia has led our sales and business development efforts for over three years, resulting in record-high sales and revenue each of the last three years. Mr. Battaglia received a B.S. degree in finance from the Carroll School of Management at Boston College.

 

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EXECUTIVE COMPENSATION DISCUSSION

 

Compensation Discussion and Analysis

 

Our Company

 

Blink Charging Co., through its wholly owned subsidiaries, is a leading owner, operator, and provider of EV charging equipment and networked EV charging services. Blink offers residential and commercial EV charging equipment, enabling EV drivers to recharge at various location types. Blink’s principal line of products and services is its Blink Networks and Blink EV charging equipment, also known as EVSE and other EV-related services. The Blink Networks provide Property Partners with cloud-based services that enable the remote monitoring and management of EV charging stations. The Blink Networks also provide EV drivers with vital station information, including station location, availability and fees. Blink, through its wholly owned subsidiary Envoy Mobility, also operates an EV based ride-sharing business. In addition to this core focus, Blink is actively engaged in various initiatives and programs promoting sustainability and renewable energy, including the promotion of solar energy, batteries and other technologies that support eco-friendly practices.

 

Our Named Executive Officers

 

We refer to our Chief Executive Officer, the Chief Financial Officer, and our three most highly compensated executive officers who were serving as executive officers at the end of our latest fiscal year as our Named Executive Officers (“NEOs”). In 2023, our NEOs and their roles during 2023 were as follows:

 

Named Executive Officer   Age   Role
Brendan S. Jones   60   President and Chief Executive Officer
Michael P. Rama   58   Chief Financial Officer
Aviv Hillo   59   General Counsel and Executive Vice President – M&A
Harjinder Bhade   60   Chief Technology Officer
Michael C. Battaglia   53   Chief Operating Officer
Michael D. Farkas   52   Former Executive Chairman and Chief Executive Officer

 

Leadership Transition

 

On May 1, 2023, Michael D. Farkas resigned from the position of Chief Executive Officer of our company. The resignation was treated by us as a termination for good reason under the terms of Mr. Farkas’ employment agreement. Effective May 1, 2023, Brendan S. Jones was promoted to Chief Executive Officer of our company, to serve as President and Chief Executive Officer of the company. In connection with his promotion, Mr. Jones entered into a new employment agreement, details of which are described in the section titled “Employment and Management Contracts, Termination of Employment and Change-in-Control Agreements.”

 

Executive Summary

 

Fiscal year 2023 was a historic year for Blink marked by significant achievements and growth due to strong demand for its products and services and its ability to drive operational excellence.

 

Our focus on continuously improving and optimizing our products and services led to several financial and operational achievements, including the following:

 

  1. Gross margin increased to 29% versus 24% prior year;
  2. 130% increase in revenue versus prior year;
  3. exceeded analyst revenue expectation in every quarter of 2023;
  4. continued synergy and cost reductions activities in all business units;
  5. integrated the 2022 acquisition of SemaConnect into Blink’s global network;
  6. launched Vision, EQ 200, Series 3, PQ 150 and 30kW DC Fast Charger, which are designed to serve the increasing demands of the growing EV markets across the U.S., Europe, Asia and Latin America; and
  7. expanded electric vehicle charging accessibility by incorporating the North America Charging Standard (NACS) and Combined Charging System (CCS) into entire product line.

 

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As our business continues to evolve and grow, so too does our pay program. Our executive compensation arrangements are aligned more closely with market and investor expectations. We also remain committed to a pay-for-performance philosophy as evident in our short- and long-term incentive programs. In 2023, for example, our short-term incentive program was tied to multiple factors driving revenue growth, sales, product margins, M&A, network integrations and customer satisfaction. Achievement against these goals led to a cash payment at 100.6% of target.

 

Consideration of Advisory Votes to Approve the Compensation of our Named Executive Officers

 

At our 2022 Annual Meeting of Stockholders held on July 11, 2022, approximately 70% of the votes cast were in support of our say-on-pay agenda item. Following the 2022 annual meeting, the Committee undertook an engagement effort to solicit stockholders’ views on executive compensation and corporate governance in order to better understand the 2022 say-on-pay vote result. We made significant modifications to our incentive structures due to this shareholder engagement. The Compensation Committee will continue to review say-on-pay voting and consider shareholder feedback as we shape the future of the executive incentive program.

 

Compensation Philosophy

 

The primary goals of our Board with respect to executive compensation are to attract and retain talented and dedicated executives, to tie annual and long-term cash and stock incentives to the achievement of specified performance objectives, and to create incentives resulting in increased stockholder value. To achieve these goals, our Compensation Committee recommends to our Board executive compensation packages, generally comprising a mix of salary, discretionary bonus and equity awards. Although we have not adopted any formal guidelines for allocating total compensation between equity compensation and cash compensation, we have implemented and maintain compensation plans that tie a substantial portion of our executives’ overall compensation to the achievement of corporate goals.

 

Role of Compensation Consultant

 

The Compensation Committee has the power to engage independent advisors to assist it in carrying out its responsibilities.

 

The Compensation Committee continued to engage Korn Ferry, an internationally recognized compensation consulting firm, as its compensation consultant in 2023. Korn Ferry reviewed and advised the Compensation Committee on our compensation practices. The Compensation Committee assessed the independence of Korn Ferry pursuant to SEC rules and concluded that the work of Korn Ferry has not raised any conflict of interest.

 

The Compensation Committee reviewed widely used survey data to benchmark our compensation arrangements. The Compensation Committee used broad survey data, in part, because there was a lack of direct data on publicly traded electric vehicle charging station companies as a peer group. Additionally, the Compensation Committee chose this approach as the large size of the survey reduced the dependence of the results on any one industry that could otherwise skew the survey results in any particular year.

 

Using this approach, Korn Ferry compared positions of similar scope and complexity with the data contained in the surveys. Korn Ferry then provided a salary range for each executive level. The Compensation Committee typically sets target compensation levels for executives in the 50th to 75th percentile range as it believes the use of this range (i) helps ensure our compensation program provides sufficient compensation to attract and retain talented executives and (ii) maintains internal pay equity, without overcompensating our employees. Each executive’s target compensation level for this purpose is based on the sum of his base salary, annual cash bonus and annual equity award but excludes one-time equity/option awards.

 

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The Compensation Committee reviews pay practices at companies of similar size and industry. The current peer group data is used to evaluate the compensation arrangements for our named executive officers and directors. With respect to Korn Ferry’s assessment, the comparable group of companies consisted of the companies listed below as determined to: (i) focus on the same industry or adjacent industry as us, (ii) generally have similar revenues as us, (iii) generally have similar market capitalization as us, (iv) generally have similar operating income as us, and (v) generally have the same number of employees as us. The comparable list of companies included Allego N.V., Beam Global, ChargePoint Holdings, EVgo, Inc., Nuvve Holding Corp., Tritium DCFC Limited, Volta Inc. and Wallbox N.V.

 

It is expected that Korn Ferry’s assessment using both survey data and peer group analyses will continue to be considered in setting compensation and in renewing the terms of employment agreements with several of our executive officers.

 

Elements of Compensation

 

We evaluate individual executive performance with a goal of setting compensation at levels our Board or any applicable committee believes are comparable with executives in other companies of similar size and stage of development while taking into account our relative performance and our own strategic goals. The compensation received by our named executive officers consists of the following elements:

 

Base Salary

 

Base salaries for our executives are established based on the scope of their responsibilities and individual experience, taking into account competitive market compensation paid by other companies for similar positions within our industry.

 

Named Executive Officer During Fiscal Year 2023 

Target Base
Salary During

Fiscal Year 2023

 
Brendan S. Jones  $775,000 (1)
Michael P. Rama  $410,000 
Aviv Hillo  $410,000 
Harjinder Bhade  $500,000 
Michael C. Battaglia  $356,076 
Michael D. Farkas  $900,000 (2)

 

(1) Represents Mr. Jones’ base salary following his appointment to Chief Executive Officer. The Summary Compensation table includes the amount actually paid during the fiscal year.
(2) Represents Mr. Farkas’ base salary at the beginning of the fiscal year and prior to his termination of employment in May 2023.

 

The Compensation Committee considers compensation data from the peer companies to the extent the executive positions at these companies are considered comparable to our positions and informative of the competitive environment. Compensation data for our peer group were collected from available proxy-disclosed data. This information was gathered and analyzed for the 25th, 50th and 75th percentiles (or alternatively using low, medium and high categories) for annual base salary, short-term incentive pay elements and long-term incentive pay elements.

 

Variable Pay

 

We design our variable pay programs to be both affordable and competitive in relation to the market. We monitor the market and adjust our variable pay programs as needed. Our variable pay programs, such as our Bonus Program (as defined below), are designed to motivate employees to achieve overall goals. Our programs are designed to avoid entitlements, to align actual payouts with the actual results achieved, and to be easy to understand and administer.

 

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Bonus Program

 

The Compensation Committee administers a cash-based incentive program (the “Bonus Program”) to reward executives for the achievement of short-term financial and operational goals, which are established by the Compensation Committee. Each executive officer has a target bonus opportunity set for each performance period under the Bonus Program. Our Compensation Committee took into account market data, relative levels of responsibility across our company, and other relevant factors in order to set the target awards for each of our NEOs. For fiscal year 2023, the NEOs had the following payment targets under the Bonus Program:

 

Named Executive Officer  Target Award as a Percentage of Base Salary   Target Award 
Brendan S. Jones   60%  $465,000 
Michael P. Rama   50%  $205,000 
Aviv Hillo   50%  $205,000 
Harjinder Bhade   60%  $300,000 
Michael C. Battaglia   50%  $175,038 
Michael D. Farkas   100%  $900,000 

 

The award payable to each NEO was primarily based on actual achievement against performance goals established by the Compensation Committee. For each metric, the Compensation Committee set a target level of achievement and the initial award amount may be adjusted based on performance above or below the target level. In addition, the Compensation Committee may take into account other factors, such as individual performance when arriving at the final award amount.

 

The targets and outcomes of the Bonus Program are described below.

 

Metric   Weighting     Target   Achievement    

Percent

Achievement

   

Percentage of

Bonus Payout

 
Product Margins     15%     Increase product margins from 30% in 2022 to 34% in 2023   34%       100%       15%  
Sales     20%     31,195 units sold or contracted
units/ports
  38,000 units sold       121.8%       24.4%  
Customer Satisfaction     10%     8.0 measured by Plug Share Meet and Exceed JD Powers Industry Average   7.5       0%       0%  
Revenue     30%     $100.4 million   $138 million       137.4%       41.2%  
Network and Systems Integration     10%     Finalize Network and Systems Integrations with Blink Belgium and UK   Blink Belgium and UK in process of migration       50%       5%  
M&A     15%     Combination of 2 acquisitions or new market entries   Acquired Envoy and opened office in Korea       100%       15%  
Total                               100.6%  

 

The corporate performance goals will be measured at the end of each performance period after our financial reports have been published or such other appropriate time as our Compensation Committee determines. If the corporate performance goals and individual performance objectives are met, payments will be made as soon as practicable following the end of each performance period. In general, an executive officer must be employed by us on the bonus payment date to be eligible to receive a bonus payment. The Bonus Program also permits our Compensation Committee to approve additional bonuses to executive officers in its sole discretion, which are described below.

 

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Based on review of performance against established goals as well as consideration of individual performance, the Compensation Committee determined the following payouts for our NEOs:

 

Named Executive Officer  Target Award   Actual Payment 
Brendan S. Jones  $465,000   $467,790 
Michael P. Rama  $205,000   $206,230 
Aviv Hillo  $205,000   $206,230 
Harjinder Bhade  $300,000   $301,800 
Michael C. Battaglia  $175,038   $176,088 
Michael D. Farkas  $900,000   $300,000 

 

Upon his termination of employment in May 2023 and in accordance with his employment agreement, Mr. Farkas was awarded the target cash award which was prorated for the number of days Mr. Farkas was employed during the year.

 

Equity-Based Incentives

 

Salaries and bonuses are intended to compensate our executive officers for short-term performance. We also have adopted an equity incentive program intended to reward longer-term performance and to help align the interests of our named executive officers with those of our stockholders. We believe that long-term performance is achieved through an ownership culture that rewards performance by our named executive officers through the use of equity incentives. Our equity incentive plan has been established to provide our employees, including our named executive officers, with incentives to help align those employees’ interests with the interests of our stockholders.

 

Future equity awards that we make to our named executive officers will be driven by our sustained performance over time, our named executive officers’ ability to impact our results that drive stockholder value, their level of responsibility, their potential to fill roles of increasing responsibility, and competitive equity award levels for similar positions in comparable companies. Equity forms a key part of the overall compensation for each executive officer and is evaluated each year as part of the annual performance review process and incentive payout calculation.

 

Annual Equity Awards

 

When determining annual equity awards, the Compensation Committee considers market data, the grant size, the forms of long-term equity compensation available to it under our existing plans and the status of previously granted awards. Existing ownership levels are not a factor in award determination, as the Compensation Committee does not want to discourage executives from holding significant amounts of our stock. For fiscal year 2023, the Compensation Committee determined that awards with time-based vesting conditions were the most appropriate.

 

In addition to the factors above, the size of each individual’s grant is determined after consideration of performance criteria established in the prior fiscal year under the Bonus Program. After the conclusion of each fiscal year, the members of the Compensation Committee review corporate performance goals established for the recently completed year. The Compensation Committee then adjusts the size of each individual’s grant in accordance with performance.

 

With respect to grants made to Mr. Farkas, 50% of the restricted stock vested immediately with the remaining 50% vesting over a three-year period with 33-1/3% vesting on each anniversary of the grant date. With respect to grants made to Messrs. Jones, Rama, Hillo and Bhade, 50% of the restricted stock vested on the first anniversary of the grant date with the remaining 75% vesting over a three-year period with 33-1/3% vesting on each anniversary of the grant date. Pursuant to their employment agreements, 50% of the annual grants for Messrs. Rama and Hillo vest immediately with the remainder vesting in equal increments on each anniversary of the grant date. All equity awards to our employees, including named executive officers, and to directors have been granted and reflected in our financial statements, based upon the applicable accounting guidance, with the exercise price equal to the fair market value of one share of Common Stock on the grant date.

 

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The annual grants to the NEOs in fiscal year 2023 were as follows:

 

Named Executive Officer  Restricted Stock Unit Grant Date Value 
Brendan S. Jones  $258,875 
Michael P. Rama  $212,500 
Aviv Hillo  $197,790 
Harjinder Bhade  $218,000 
Michael C. Battaglia   N/A 
Michael D. Farkas  $4,690,000 (1)

 

(1) Upon Mr. Farkas’ termination of employment, 2023 grants were treated in accordance with provisions of his employment agreement.

 

SemaConnect Integration Award

 

On July 29, 2022, each NEO responsible for the acquisition and integration of SemaConnect was granted one-time performance-based restricted stock awards under our Plan.

 

The awards of performance-based restricted stock were intended to provide an appropriate incentive structure for our executive management team to integrate and commercialize the SemaConnect acquisition given the transformational nature of the acquisition in a way that is aligned with stockholder interests.

 

These performance-based restricted stock awards become vested based on a series of six performance hurdles that must be achieved before the third anniversary of the grants. The performance hurdles and related vesting are:

 

  1. closing of the SemaConnect acquisition with certain cost savings (20% of grant);
  2. integration of SemaConnect’s hardware and software platforms (30% of grant);
  3. integration of the SemaConnect business processes (10% of grant);
  4. integration of the SemaConnect human capital processes (10% of grant);
  5. delivery and execution of a product rationalization roadmap and new production ready units for UL certification (20% of grant); and
  6. the Common Stock’s closing price reaching on average for a period of ten consecutive trading days a price of $23.78, which is 50% over the price paid by us to SemaConnect shareholders in the acquisition (10% of grant).

 

The Board has discretion to determine when each performance hurdle has been achieved. As of December 31, 2023, the vesting performance hurdles were met related to points 1, 4, 5 and 6 outlined above and, as of June 3, 2024, the remaining vesting performance hurdles were met. All performance hurdles for Mr. Farkas vested upon his termination of employment in accordance with his employment agreement.

 

Timing of Equity Awards

 

We do not manage the timing of equity grants to attempt to give participants the benefit of material non-public information. Annual option grants are made with effective dates in open trading windows following the Company’s release of its financial results. Only the Compensation Committee may approve restricted stock, restricted stock units or stock option grants to our executive officers. Restricted stock, restricted stock units and stock options are generally granted at meetings of the Compensation Committee or pursuant to a unanimous written consent of the Compensation Committee. All option grants are made with an exercise price at or above the closing price of our Common Stock on the date of grant.

 

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Benefits Programs

 

We design our benefits programs to be both affordable and competitive in relation to the market while conforming to local laws and practices. We monitor the market and local laws and practices and adjust our benefits programs as needed. We design our benefits programs to provide an element of core benefits and, to the extent possible, offer options for additional benefits, be tax-effective for employees in any foreign country and balance costs and cost-sharing between our employees and us.

 

Executive Equity Ownership

 

We encourage our executives to hold a significant equity interest in our company. The Board recently adopted an ownership guidelines policy for NEOs in order to align the interests of our NEOs with the long-term success of our company and our stockholders. Pursuant to the policy, NEOs are expected to achieve and maintain a minimum level of ownership of shares of Common Stock upon the initial appointment of the NEO for a period to be determined by the Board. The minimum level of ownership will be based on a multiple of the NEO’s base salary or a fixed number of shares, as determined by the Board.

 

Effect of Accounting and Tax Treatment on Compensation Decisions

 

In the review and establishment of our compensation programs, we consider the anticipated accounting and tax implications for our executives and us.

 

Generally, Section 162(m) of the Code disallows public companies a tax deduction for federal income tax purposes of compensation in excess of $1 million paid to their chief executive officer and certain other specified officers in any taxable year. For tax years ending prior to December 31, 2017, compensation in excess of $1 million could only be deducted if it was “performance-based compensation” within the meaning of Section 162(m) of the Code or qualified for one of the other exemptions from the deduction limit. The exemption from Section 162(m) of the Code’s deduction limit for performance-based compensation has been repealed, effective for taxable years beginning after December 31, 2017, such that compensation paid to our covered officers (which now also includes our Chief Financial Officer) in excess of $1 million will generally not be deductible unless it qualifies for transition relief applicable to certain arrangements in place as of November 2, 2017. We seek to maintain flexibility in compensating our executives in a manner designed to promote our corporate goals and, therefore, while we are mindful of the benefit of the full deductibility of compensation, our Compensation Committee has not adopted a policy requiring that any or all compensation to be deductible. Our Compensation Committee may authorize compensation payments that are not fully tax deductible if we believe that such payments are appropriate to attract and retain executive talent or meet other business objectives.

 

Role of Executives in Executive Compensation Decisions

 

The Board and our Compensation Committee historically sought input from Brendan S. Jones, our President and Chief Executive Officer, when discussing the performance of, and compensation levels for, executives other than himself. The Compensation Committee also works with Michael P. Rama, our Chief Financial Officer, to evaluate the financial, accounting, tax and retention implications of our various compensation programs. Mr. Jones, who is a director, does not participate in deliberations relating to his own compensation.

 

Compensation Risk Management

 

We have considered the risk associated with our compensation policies and practices for all employees, and we believe we have designed our compensation policies and practices in a manner that does not create incentives that could lead to excessive risk taking that would have a material adverse effect on us.

 

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We structure our compensation to consist of base salary, variable pay, equity-based pay and benefits. The base portion of compensation is designed to provide a steady income regardless of our stock price performance so that executives do not feel pressured to focus exclusively on stock price performance to the detriment of other important business measures. Our variable pay and equity-based pay programs are designed to reward both short- and long-term corporate performance. For short-term performance, our variable pay programs are designed to motivate employees to achieve overall goals. For long-term performance, our stock option and restricted stock unit awards generally vest 50% upon the date of grant and 50% in equal annual increments over the next three years and are only valuable if our stock price increases over time. We believe that these various elements of compensation are a sufficient percentage of overall compensation to motivate executives to produce superior short- and long-term corporate results, while the fixed element is also sufficiently high that the executives are not encouraged to take unnecessary or excessive risks in doing so.

 

Our bonus program has been structured around the attainment of overall corporate goals for the past several years and we have seen no evidence that it encourages unnecessary or excessive risk taking.

 

Clawback Policy

 

Effective December 2023, we adopted a clawback policy to align with listing rules adopted by Nasdaq as required by the SEC. The policy applies to all executive officers (as defined under the applicable rules) and requires our company to seek to recoup certain incentive-based compensation, whether cash- or equity-based, from current or former officers and in the event that we are required to prepare an accounting restatement due to the material noncompliance of our company with any financial reporting requirement under the securities laws. The Board is responsible for the oversight of this policy and has the authority to determine the necessity, exercise and implementation of the clawback of executive incentive-based compensation in the event of a restatement of our financial statements. In the event that recovery is required, the Board will review and recover reasonably promptly the applicable portion of incentive-based compensation awarded to or earned by our officers during the three-year period prior to any restatement of our financial results. Recovery will be required on a “no fault” basis, without regard to whether any misconduct occurred and without regard to whether an executive officer was responsible for the erroneous financial statements.

 

Director and Officer Derivative Trading Policy

 

Under our insider trading policy, our executive officers, directors and employees may not engage in derivative trading involving our company’s securities.

 

Executive Compensation Tables

 

Summary Compensation Table

 

The following summary compensation table sets forth all compensation awarded to, earned by, or paid to our principal executive officers who served as such during part of 2023 (Michael D. Farkas and Brendan S. Jones), our principal financial officer who served as such during all of 2023 (Michael P. Rama) and our three most highly compensated executive officers other than our principal executive officer and principal financial officer who were serving as executive officers at the end of 2023 (Aviv Hillo, Harjinder Bhade and Michael C. Battaglia).

 

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       Award Compensation 

Name and

Principal

Position

  Year  

Salary

($)

  

Bonus(8)

($)

  

Stock

Awards(7)

($)

  

Option

Awards(7)

($)

  

Non-Equity

Incentive Plan

Compensation(8)

($)

  

Change in

Pension

Value and

Nonqualified

Deferred

Compensation

Earnings

($)

  

All Other

Compensation

($)

   Total
($)
 
Michael D. Farkas(1)   2023   $308,000   $-   $4,690,000   $-   $-   $-   $6,139,081   $11,137,081 
Former Executive Chairman and   2022   $874,006   $-   $12,473,546   $-   $1,700,000   $-   $830,260   $15,877,812 
Chief Executive Officer   2021   $1,003,810   $1,281,000   $768,172   $14,431,369   $2,000,000   $-   $519,400   $20,003,751 
                                              
Brendan S. Jones(2)   2023   $681,759   $75,000   $258,875   $-   $467,790   $-   $29,917   $1,513,341 
President and Chief   2022   $493,011   $-   $1,184,859   $-   $310,650   $-   $64,242   $2,052,762 
Executive Officer   2021   $380,750   $1,000   $24,548   $3,629,530   $187,500   $-   $225,368   $4,448,696 
                                              
Michael P. Rama(3)   2023   $423,056   $-   $212,500   $-   $206,230   $-   $354,051   $1,195,837 
Chief Financial   2022   $408,003   $-   $701,807   $-   $212,550   $-   $282,646   $1,605,006 
Officer   2021   $327,750   $1,000   $33,493   $100,480   $101,562   $-   $636,962   $1,201,247 
                                              
Aviv Hillo(4)   2023   $423,000   $-   $197,790   $    $206,230   $-   $18,972   $845,992 
General   2022   $377,167   $-   $701,807   $-   $197,790   $-   $52,206   $1,328,970 
Counsel and Executive Vice President - M&A   2021   $327,750   $1,000   $37,500   $112,500   $101,562   $-   $45,189   $625,501 
                                              
Harjinder Bhade(5)   2023   $477,212   $-   $218,000   $-   $5,301,800   $-   $29,917   $6,026,929 
Chief Technology Officer   2022   $403,602   $-   $665,116   $-   $218,000   $-   $68,304   $1,355,022 
    2021   $251,800   $1,000   $-   $-   $166,438   $-   $17,649   $436,887 
                                              
Michael C. Battaglia (6)   2023   $327,515   $-   $-   $-   $176,088   $          -   $29,917   $533,520 
Chief Operating Officer                                             

 

(1) Michael D. Farkas served as our Executive Chairman and Chief Executive Officer until May 1, 2023 and was appointed to these positions in January 2015 and October 2018 (and previously from 2010 to July 2015), respectively. On June 21, 2023, our company and Mr. Farkas entered into a separation and general release agreement, dated as of June 20, 2023 (the “Separation Agreement”) pursuant to Mr. Farkas’ May 1, 2023 termination of employment and the terms of Mr. Farkas’ employment agreement, effective as of January 1, 2021. The Separation Agreement became effective on June 28, 2023, following a statutory revocation period. Under the terms of the Separation Agreement, the company agreed to provide Mr. Farkas with (i) $6,131,929 in cash compensation including accrued vacation, (ii) 383,738 shares of the company’s common stock with grant date fair value of $2,690,000 included under Stock Awards and (iii) reimbursement for medical benefits under COBRA for 24 months or until Mr. Farkas becomes eligible for coverage under another employer’s group plan. Included in All Other Compensation is $6,131,929 related to the cash paid in accordance with the Separation Agreement. On May 28, 2021, Mr. Farkas entered into the employment agreement which included increases in cash and equity compensation, as well as one-time awards and payments in satisfaction of his 2020 bonuses of $1,280,000 (included in Bonus), restricted stock grant of 19,504 shares of common stock (included in Stock Awards), grant of 23,862 in stock options (included in Option Awards), and a salary catch-up since the expiration of his prior agreement in June 2020 of $294,575 (included in Salary). Mr. Farkas also received a special four-year performance option to purchase 475,285 shares of common stock at an exercise price of $37.40 per share, which will vest if the company’s stock price on the Nasdaq exchange reaches and remains on average for a period of 20 consecutive market days at a closing price of $90 per share during the four-year term of the option. The performance option had a grant date fair value of $13,531,369, which was estimated using a third-party provider who utilized a Monte Carlo simulation model (included in Option Awards). Included in All Other Compensation for Mr. Farkas are (i) company-paid health insurance benefits of $7,152, $19,256 and $21,006 in 2023, 2022 and 2021, respectively, (ii) company-paid car lease and insurance expenses of $0, $0 and $40,947 in 2023, 2022 and 2021, respectively, and (iii) a tax gross-up of $0, $811,005 and $498,394 relating to the vesting of stock awards in 2023, 2022 and 2021, respectively. The 2022 tax gross-up payment was from the vesting of stock awards that were granted prior to the termination of such benefit.

 

28
 

 

(2) Mr. Jones has served as our President since February 2021 and our Chief Executive Officer since May 2023. In connection with Mr. Jones’ appointment as President in February 2021, our Compensation Committee granted to Mr. Jones stock options to purchase 100,000 shares of our common stock at an exercise price of $38.39 per share, the closing price of our common stock on February 25, 2021. The stock options, which were granted under the terms of our 2018 Incentive Compensation Plan (the “2018 Plan”), are exercisable in three equal annual increments on the first, second and third anniversaries of the grant date. These stock options had a grant date fair value of $3,555,886 (included in Option Awards). Included in Bonus for Mr. Jones is a cash signing bonus of $75,000 in 2023 in accordance with his employment agreement. Included in All Other Compensation for Mr. Jones are (i) company-paid health insurance benefits of $29,917, $33,827 and $35,297 in 2023, 2022 and 2021, respectively, and (ii) a tax gross-up of $0, $30,416 and $190,071 relating to the vesting of stock awards in 2023, 2022 and 2021, respectively. The 2022 tax gross-up payment was from the vesting of stock awards that were granted prior to the termination of such benefit.
   
(3) Mr. Rama has served as our Chief Financial Officer since February 2020. Included in All Other Compensation for Mr. Rama are (i) company-paid health insurance benefits of $29,917, $32,356 and $35,298 in 2023, 2022 and 2021, respectively and (ii) a tax gross-up of $324,133, $250,290 and $601,664 relating to the vesting of stock awards in 2023, 2022 and 2021, respectively. The 2023 and 2022 tax gross-up payment was from the vesting of stock awards that were granted prior to the termination of such benefit.
   
(4) Mr. Hillo has served as our General Counsel since April 2018 and our Executive Vice President of Mergers & Acquisitions since May 2022. Included in All Other Compensation for Mr. Hillo are (i) company-paid health insurance benefits of $18,972, $19,256 and $21,006 in 2023, 2022 and 2021, respectively, and (ii) a tax gross-up of $0, $32,950 and $24,183 relating to the vesting of stock awards in 2023, 2022 and 2021, respectively. The 2022 tax gross-up payment was from the vesting of stock awards that were granted prior to the termination of such benefit.
   
(5) Mr. Bhade has served as our Chief Technology Officer since May 2021. Included in All Other Compensation for Mr. Bhade is (i) company-paid health insurance benefits of $29,917, $32,356 and $17,649 in 2023, 2022 and 2021, respectively and (ii) a tax gross-up of $0, $35,948 and $0 relating to the vesting of stock awards in 2023, 2022 and 2021, respectively. The 2022 tax gross-up payment was from the vesting of stock awards that were granted prior to the termination of such benefit. Included in Non-Equity Incentive Plan Compensation is $5,000,000 related to long-term cash incentive related to the successful completion of certain milestones and $301,800 related to the annual cash incentive program.
   
(6) Mr. Battaglia has served as our Chief Operating Officer since September 2023. Included in All Other Compensation for Mr. Battaglia is company-paid health insurance benefits of $29,917 in 2023.
   
(7) Represents stock and option awards granted in 2023, 2022 and 2021 pursuant to our 2018 Plan. The aggregate grant date fair value of such awards was calculated in accordance with FASB ASC Topic 718. These amounts do not represent actual amounts paid or to be realized. Amounts shown are not necessarily indicative of values to be achieved, which may be more or less than the amounts shown as awards are subject to time-based vesting. The assumptions used in calculating these amounts are discussed in Note 10 of the Notes to Consolidated Financial Statements included in our Annual Report.
   
(8) Amounts for 2021 have been revised to reflect when compensation was earned regardless of when paid.

 

29
 

 

Grant of Plan-Based Awards

 

The following table sets forth information concerning grants of plan-based awards made by us during the year ended December 31, 2023, to each of the NEOs.

 

      

Estimated Future Payouts

Under Non-Equity Incentive

Plan Awards

  

Estimated Future Payouts

Under Equity Incentive Plan

Awards

   All Other Stock Awards: Number of Shares of Stock  

All Other Option Awards: Number of Securities

Underlying

   Exercise or Base Price of Options   Grant Date Fair Value of Stock and Option 
Name   Grant Date  Threshold ($)   Target ($)   Maximum ($)   Threshold (#)  

Target

(#)

   Maximum (#)   or Units (#)  

Options

(#)

   Awards ($/sh)  

Awards

($)

 
Michael D. Farkas(1)      $   -   $    $-    -    -    -    -    -   $-   $- 
3/15/2023      $-   $-   $-    -    -    -    258,065    -   $-   $2,000,000 
6/21/2023      $-   $-   $-    -         -    383,738    -   $-   $2,690,000 
                                                       
Brendan S. Jones      $-   $465,000   $-    -    -    -    -    -   $-   $- 
3/15/2023      $-   $-   $-    -    -    -    33,403    -   $-   $258,875 
                                                       
Michael P. Rama      $-   $205,000   $-    -    -    -    -    -   $-   $- 
3/15/2023      $-   $-   $-    -    -    -    27,426    -   $-   $212,550 
                                                       
Aviv Hillo      $-   $205,000   $-    -    -    -    -    -   $-   $- 
3/15/2023      $-   $-   $-    -    -    -    25,521    -   $-   $197,790 
                                                       
Harjinder Bhade      $-   $300,000   $-    -    -    -    -    -   $-   $- 
3/15/2023      $-   $-   $-    -    -    -    28,129    -   $-   $218,000 
                                                       
Michael C. Battaglia      $-   $178,038   $        -        -    -        -    -    -   $-   $- 

 

(1) On June 21, 2023, our company and Mr. Farkas entered into a separation and general release agreement, dated as of June 20, 2023 (the “Separation Agreement”), pursuant to Mr. Farkas’ May 1, 2023 termination of employment and the terms of Mr. Farkas’ employment agreement, effective as of January 1, 2021. The Separation Agreement became effective on June 28, 2023, following a statutory revocation period. Under the terms of the Separation Agreement, the company agreed to provide Mr. Farkas with 383,738 shares of the company’s common stock.

 

30
 

 

Outstanding Equity Awards at Fiscal Year-End

 

The following table provides information on outstanding equity awards as of December 31, 2023 to the NEOs:

 

      Option Awards   Stock Awards 
Name  Grant Date  Number of
Securities
Underlying
Unexercised Options (#)
Exercisable
   Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable
   Equity
Incentive
Plan Awards: Number of
Securities
Underlying
Unexercised
Unearned
Options (#)
   Option
Exercise
Price
($)
   Option
Expiration
Date
   Number of
Shares or
Units of
Stock That
Have Not
Vested (#)
   Market
Value of
Shares or Units of
Stock That
Have Not
Vested ($)
   Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)   Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested(1) ($) 
Michael D. Farkas  04/16/2019   -    -    100   $3.30   04/16/24                    -   $                 -    -   $- 
Michael D. Farkas  05/14/2019   -    -    4,200   $3.06   05/14/24    -   $-    -   $- 
Michael D. Farkas  12/04/2020   -    -    100   $25.59   12/04/25    -   $-    -   $- 
Michael D. Farkas  12/07/2020   -    -    100   $26.41   12/07/25    -   $-    -   $- 
Michael D. Farkas  12/11/2020   -    -    100   $31.13   12/11/25    -   $-    -   $- 
Michael D. Farkas  05/28/2021   -    -    475,285   $37.40   05/28/25    -   $-    -   $- 
Michael D. Farkas  02/10/2021   -    -    100   $59.22   02/10/26    -   $-    -   $- 
Michael D. Farkas  02/12/2021   -    -    100   $56.27   02/12/26    -   $-    -   $- 
Michael D. Farkas  02/23/2021   -    -    400   $42.67   02/23/26    -   $-    -   $- 
Michael D. Farkas  03/29/2021   -    -    100   $38.45   03/29/26    -   $-    -   $- 
Michael D. Farkas  03/31/2021   -    -    100   $45.21   03/31/26    -   $-    -   $- 
Michael D. Farkas  04/12/2021   -    -    7,976   $44.90   04/11/27    -   $-    -   $- 
Michael D. Farkas  04/12/2021   -    -    7,976   $44.90   04/11/28    -   $-    -   $- 
Michael D. Farkas  04/12/2021   -    -    7,976   $44.90   04/11/29    -   $-    -   $- 
Brendan S. Jones  02/25/2021   -    -    33,333   $38.39   02/25/27    -   $-    -   $- 
Brendan S. Jones  04/12/2021   -    -    648   $40.82   04/11/27    -   $-    -   $- 
Brendan S. Jones  02/25/2021   -    -    33,333   $38.39   02/25/28    -   $-    -   $- 
Brendan S. Jones  04/12/2021   -    -    648   $40.82   04/11/28    -   $-    -   $- 
Brendan S. Jones  02/25/2021   -    -    33,334   $38.39   02/25/29    -   $-    -   $- 
Brendan S. Jones  04/12/2021   -    -    648   $40.82   04/11/29    -   $-    -   $- 
Brendan S. Jones(2)  03/21/2022   -    -    -   $-   -    -   $-    3,816   $12,936 
Brendan S. Jones(3)  07/29/2022   -    -    -   $-   -    -   $-    18,895   $64,054 
Brendan S. Jones(4)  03/15/2023   -    -    -   $-   -    -   $-    16,702   $56,620 
Michael P. Rama  06/05/2020   -    -    50,000   $2.20   02/07/26    -   $-    -   $- 
Michael P. Rama  06/05/2020   -    -    50,000   $2.20   02/07/27    -   $-    -   $- 
Michael P. Rama  04/12/2021   -    -    885   $40.82   04/11/27    -   $-    -   $- 
Michael P. Rama  06/05/2020   -    -    50,000   $2.20   02/07/28    -   $-    -   $- 
Michael P. Rama  04/12/2021   -    -    885   $40.82   04/11/28    -   $-    -   $- 
Michael P. Rama  04/12/2021   -    -    884   $40.82   04/11/29    -   $-    -   $- 
Michael P. Rama(2)  03/21/2022   -    -    -   $-   -    -   $-    4,134   $14,014 
Michael P. Rama(3)  07/29/2022   -    -    -   $-   -    -   $-    9,447   $32,025 
Michael P. Rama(4)  03/15/2023           -           -    -   $-   -    -   $-    13,713   $46,487 
Aviv Hillo  03/31/2019   -    -    3,879   $3.13   03/31/27    -   $-    -   $- 
Aviv Hillo  04/12/2021   -    -    990   $40.82   04/11/27    -   $-    -   $- 
Aviv Hillo  04/20/2020   -    -    16,517   $1.83   04/20/27    -   $-    -   $- 
Aviv Hillo  04/12/2021   -    -    991   $40.82   04/11/28    -   $-    -   $- 
Aviv Hillo  04/20/2020   -    -    16,286   $1.83   04/20/28    -   $-    -   $- 
Aviv Hillo  04/12/2021   -    -    991   $40.82   04/11/29    -   $-    -   $- 
Aviv Hillo  05/17/2022   -    -    12,441   $15.70   05/17/28    -   $-    -   $- 
Aviv Hillo  05/17/2022   -    -    12,441   $15.70   05/17/29    -   $-    -   $- 
Aviv Hillo  05/17/2022   -    -    12,441   $15.70   05/17/30    -   $-    -   $- 
Aviv Hillo(2)  03/21/2022   -    -    -   $-   -    -   $-    4,134   $14,014 
Aviv Hillo(3)  07/29/2022   -    -    -   $-   -    -   $-    9,447   $32,025 
Aviv Hillo(4)  03/15/2023   -    -    -   $-   -    -   $-    12,761   $43,260 
Harjinder Bhade(2)  03/21/2022   -    -    -   $-   -    -   $-    3,387   $11,489 
Harjinder Bhade(3)  07/29/2022   -    -    -   $-   -    -   $-    9,447   $32,025 
Harjinder Bhade(4)  03/15/2023   -    -    -   $-   -    -   $-    21,097   $71,519 
Michael C. Battaglia(5)  05/6/2021   -    -    54,000   $32.27   -    -   $-    -   $- 
Michael C. Battaglia(6)  04/12/2021   -    -    -   $-   -    -   $-    360   $1,220 
Michael C. Battaglia(7)  04/12/2021   -    -    -   $-   -    -   $-    2,240   $7,594 

 

(1) Calculated by multiplying the number of shares of common stock by $3.39, which is the quoted market price per share of our common stock as of December 31, 2023.

 

31
 

 

(2) These shares vest in two annual increments on March 21, 2024 and 2025, subject to immediate vesting upon an event constituting a change of control of the company.
(3) These shares vest in various increments based on the achievement of certain performance conditions related to the integration of the SemaConnect acquisition during 2022.
(4) These shares vest in three annual increments on March 15, 2024, 2025 and 2026, subject to immediate vesting upon an event constituting a change of control of the company.
(5) On May 6, 2021, Mr. Battaglia received options to purchase 54,000 shares of common stock. Options to purchase 36,000 shares of common stock have vested and are currently exercisable. Options to purchase the remaining 18,000 shares of common stock vest and become exercisable on May 6, 2024.
(6) These shares vested in full on April 12, 2024.
(7) These shares vest in two equal installments on April 1, 2024 and April 1, 2025.

 

Option Exercises and Stock Vested During 2023

 

The following table sets forth information concerning the option exercises and stock awards vested of each of the NEOs during the year ended December 31, 2023:

 

   Option Awards   Stock Awards 
  

Number of

Shares

Acquired on

Exercise

  

Value

Realized on

Exercise

  

Number of

Shares

Acquired On

Vesting

  

Value

Realized on

Vesting

 
Name  (#)   ($)   (#)   ($) 
Michael D. Farkas   112,031   $225,760    671,438   $5,135,721 
Brendan S. Jones   -   $-    32,780   $275,655 
Michael P. Rama   -   $-    39,532   $512,153 
Aviv Hillo   -   $-    21,913   $180,639 
Harjinder Bhade   -   $-    165,811   $475.348 
Michael C. Battaglia   -   $-    1,470   $12,502 

 

Pension Benefits

 

We have not adopted a pension plan and do not provide pension benefits to NEOs.

 

Non-Qualified Deferred Compensation

 

We have not adopted a non-qualified deferred compensation plan and do not provide non-qualified deferred compensation to NEOs.

 

Employment and Management Contracts, Termination of Employment and Change-in-Control Agreements

 

Michael D. Farkas Separation Agreement

 

On June 21, 2023, our company and our former Chief Executive Officer Michael D. Farkas entered into a separation and general release agreement, dated as of June 20, 2023, pursuant to Mr. Farkas’ May 1, 2023 termination of employment and the terms of Mr. Farkas’ employment agreement, effective as of January 1, 2021. The separation agreement became effective on June 28, 2023. Under the terms of the separation agreement, we provided Mr. Farkas with (i) $6,028,083 in cash compensation, (ii) 383,738 shares of our common stock, and (iii) reimbursement for medical benefits under COBRA for 24 months or until Mr. Farkas becomes eligible for coverage under another employer’s group plan. In addition, Mr. Farkas’ outstanding issued and unvested equity awards vested. In return, Mr. Farkas agreed that he has received all compensation to which he is entitled with respect to his employment or termination thereof (except for any obligations under the parties’ Commission Agreement, dated as of November 17, 2009) and Mr. Farkas is releasing us from all claims that he might have related to his employment. Further, Mr. Farkas acknowledged that the terms of his non-competition and non-solicitation covenants under his employment agreement remain in effect, except that Mr. Farkas will be permitted to continue to work with certain individuals with whom he has a current relationship outside of the company.

 

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Brendan S. Jones Employment Agreement

 

In connection with Mr. Jones’ appointment as the Chief Executive Officer, we entered into a new employment agreement with Mr. Jones superseding his prior employment agreement which was dated December 27, 2021. The term of the employment agreement started on May 1, 2023 and extends until April 30, 2026, and will automatically renew for successive one year periods unless intent to terminate the agreement is timely provided in writing by either party to the other. Pursuant to the employment agreement, Mr. Jones has agreed to devote his full business efforts, attention, energy and skill to the performance of his employment to furthering the interest of our company. The employment agreement provides that Mr. Jones is entitled to receive an annual base salary of $775,000, payable in accordance with our payroll policies and procedures. Mr. Jones will be eligible for an annual performance cash bonus targeted at 60% of his annual base salary based on meeting pre-determined periodic key performance indicators every year set by the mutual agreement of our Board’s Compensation Committee and Mr. Jones. Mr. Jones will also be eligible to receive aggregate annual equity awards under our incentive compensation plan with a target aggregate award of 60% of his annual base salary. Mr. Jones will receive a one-time signing bonus of $150,000, with 50% in cash paid upon assuming the position of Chief Executive Officer and 50% upon the one-year anniversary of assuming such position.

 

If Mr. Jones’s employment is terminated by us other than for Cause (which includes, among other reasons, willful material misconduct and willful failure to materially perform his responsibilities to the company), he is entitled to receive severance equal to 1.5 times the sum of his base salary and his target bonus, as well as a pro rata target bonus for the year of his termination based upon the number of months actually worked in that year, and reimbursement for COBRA for 18 months.

 

If our company undergoes a “Change in Control” (which generally means a merger or acquisition of our company as a result of which the acquirer obtains more than 50% of our total voting power), the multiple in Mr. Jones’s severance above shall be three times, if (i) he loses his position as Chief Executive Officer (excluding elevation to a more senior position), (ii) his position, authority, duties, authority or base salary is materially reduced, or (iii) he is terminated without Cause or the employment agreement is not renewed during the merger/acquisition process or within 18 months after the closing of the transaction. Additionally, all restricted common stock and stock options held by Mr. Jones will immediately vest upon a Change in Control.

 

The employment agreement also contains restrictive covenants prohibiting Mr. Jones from disclosing confidential information regarding our company at any time and preventing Mr. Jones from soliciting any customer of our company on behalf of another company, taking any action that leads to a customer terminating or reducing its business with our company, or employing, soliciting or hiring employees of our company for a period of 12 months after his employment with our company.

 

Michael P. Rama Employment Agreement

 

On May 19, 2022, we entered into a new employment agreement with Michael P. Rama, our Chief Financial Officer, renewing his prior employment offer letter, dated as of February 7, 2020. The term of his new employment agreement started on January 1, 2022 and extends until March 31, 2025. Pursuant to the employment agreement, Mr. Rama agreed to devote his full business efforts and time to our company. The employment agreement provides that Mr. Rama will receive an initial annual base salary of $390,000, payable on our regular scheduled payday. Mr. Rama will be eligible for an annual performance cash bonus of up to 50% of his annual base salary based on meeting pre-determined periodic key performance indicators every year set by the mutual agreement of our Board’s Compensation Committee and Mr. Rama. Mr. Rama will also be eligible to receive aggregate annual equity awards under our incentive compensation plan equal to 50% of his annual base salary. Such awards will be comprised of restricted common stock. 50% of the restricted common stock granted will vest immediately on the grant date, and the remaining 50% will vest in equal one-third increments on each anniversary of the grant date, in each instance subject to satisfying key performance indicators and other performance criteria and his continued employment with us on the applicable vesting date. Mr. Rama is entitled to a monthly electric vehicle and auto insurance allowance of up to $1,500 per month, and other employee benefits in accordance with our policies.

 

If Mr. Rama’s employment is terminated by us other than for Cause (which includes willful material misconduct and willful failure to materially perform his responsibilities to our company), he is entitled to receive severance equal to the number of months of his actual employment under the new employment agreement prior to the termination capped at a maximum payment of 12 months of his base salary.

 

If we undergo a “change in control” (which generally means a merger or acquisition of our company as a result of which the acquirer obtains more than 50% of our total voting power), Mr. Rama will receive a severance payment equal to 2.99 times his annual base salary if (i) he loses his position as our Chief Financial Officer (excluding elevation to a more senior position), (ii) his title is changed to a lesser role, (iii) his compensation is materially decreased, or (iv) he is terminated without Cause during the merger/acquisition process or within one year after the closing of such transaction. Additionally, all restricted common stock and stock options held by Mr. Rama will immediately vest upon a change in control.

 

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Aviv Hillo Employment Agreement

 

On May 19, 2022, we entered into a new employment agreement with Aviv Hillo, our General Counsel, renewing his prior employment offer letter, dated as of June 18, 2018, which had been renewed on September 25, 2020. The term of his new employment agreement started on June 1, 2022, and extends until May 31, 2025. Pursuant to the employment agreement, Mr. Hillo agreed to devote his full business efforts and time to our company. The employment agreement provides that Mr. Hillo will receive an initial annual base salary of $390,000, payable on our regularly scheduled payday. Mr. Hillo will be eligible for an annual performance cash bonus of up to 50% of his annual base salary based on meeting pre-determined periodic key performance indicators every year set by the mutual agreement of our Board’s Compensation Committee and Mr. Hillo. Mr. Hillo will also be eligible to receive aggregate annual equity awards under our incentive compensation plan equal to 50% of his annual base salary. Such awards will be comprised of restricted common stock. 50% of the restricted common stock granted will vest immediately on the grant date, and the remaining 50% will vest in equal one-third increments on each anniversary of the grant date, in each instance subject to satisfying key performance indicators and other performance criteria and his continued employment with us on the applicable vesting date. As a signing bonus, Mr. Hillo received stock options to purchase 37,324 shares of common stock at $15.70 per share, which will vest in equal one-third increments on each anniversary of the grant date. Mr. Hillo is entitled to a monthly electric vehicle and auto insurance allowance of up to $1,500 per month, and other employee benefits in accordance with our policies.

 

If Mr. Hillo’s employment is terminated by us other than for Cause (which includes willful material misconduct and willful failure to materially perform his responsibilities to our company), he is entitled to receive severance equal to the number of months of his actual employment under the new employment agreement prior to the termination capped at a maximum payment of 12 months of his base salary.

 

If we undergo a “change in control” (which generally means a merger or acquisition of our company as a result of which the acquirer obtains more than 50% of our total voting power), Mr. Hillo will receive a severance payment equal to 2.99 times his annual base salary if (i) he loses his position as our General Counsel (excluding elevation to a more senior position), (ii) his title is changed to a lesser role, (iii) his compensation is materially decreased, or (iv) he is terminated without Cause during the merger/acquisition process or within one year after the closing of the transaction. Additionally, all restricted common stock and stock options held by Mr. Hillo will immediately vest upon a change in control.

 

Harjinder Bhade Employment Agreement

 

On October 30, 2023, we entered into a new employment offer letter with Harjinder Bhade, who has been our Chief Technology Officer since April 2021. The new offer letter, which extends Mr. Bhade’s employment through October 2025 (and is automatically renewable for an additional one-year term unless either party provides timely notice of non-renewal), provides that Mr. Bhade will receive an annual base salary of $500,000. Mr. Bhade will be eligible for an annual performance cash bonus equal to 60% of his annual base salary based on meeting or exceeding key performance indicators established by the Compensation Committee of our Board and Mr. Bhade for the relevant 12-month period. Mr. Bhade will also be eligible to receive aggregate annual equity awards under our 2018 Incentive Compensation Plan equal to 60% of his annual base salary. Such awards will be issued in the form of restricted stock units. Of such restricted stock units, 50% of the restricted stock units will vest on the first anniversary of the grant date, and 50% of the restricted stock units will vest in equal one-third increments on each anniversary of the grant date, in each instance subject to his continued employment with us on the applicable vesting date and satisfying the key performance indicators and other performance criteria. We also granted Mr. Bhade, upon the execution of the new offer letter, a signing bonus of 150,000 restricted stock units, vesting immediately. The above bonus and equity grants are subject to our “clawback” policies.

 

The other terms of Mr. Bhade’s new offer employment letter closely followed the terms of his original employment letter, dated April 20, 2021.

 

34
 

 

If Mr. Bhade’s employment is terminated by us other than for Cause (which includes willful material misconduct, willful failure to materially perform his job duties to our company and material violation of our company’s code of conduct and policies), he is entitled to receive severance equal to the number of months of his actual employment under the new employment agreement prior to the termination capped at a maximum payment of 12 months of his base salary and accelerated vesting of his annual equity award for up to 12 months. If there is a buy-out or a “change of control,” Mr. Bhade will also be entitled to obtain his base salary for a period of 12 months as a severance payment and, if Mr. Bhade is terminated without Cause, the balance of the additional $5.5 million in awards, any unvested equity awards and his annual performance bonus will immediately vest and be paid upon execution of a release and waiver agreement with the company.

 

As part of his original employment letter dated April 20, 2021, Mr. Bhade entered into our standard Employee Confidentiality and Assignment of Inventions Agreement prohibiting Mr. Bhade from disclosure of confidential and/or proprietary information relating to the operations, products and services of our company and our clients and acknowledging that all intellectual property developed by Mr. Bhade relating to our business constitutes our exclusive property. Mr. Bhade further agreed that during his employment with our company he will not engage in, or have any direct or indirect interest in, any person, firm, corporation or business (whether as an employee, officer, director, agent, security holder, creditor, consultant, partner or otherwise) that is competitive with the business of our company, including, without limitation, planning, developing, installing, marketing, selling, leasing and providing services relating to electric vehicle charging stations.

 

Michael C. Battaglia Employment Agreement

 

On September 18, 2023, we entered into an employment offer letter with Michael Battaglia to serve as our Chief Operating Officer. The offer letter provides an employment term for Mr. Battaglia through September 15, 2025 (which is automatically renewable for an additional one-year term unless either party provides timely notice of non-renewal) and an annual base salary of $350,075. Mr. Battaglia will be eligible for an annual performance cash bonus equal to 50% of his annual base salary based on meeting or exceeding key performance indicators established by the Compensation Committee of our Board, Mr. Battaglia and his supervisors for the relevant 12-month period. Mr. Battaglia will also be eligible to receive aggregate annual equity awards under our 2018 Incentive Compensation Plan equal to 50% of his annual base salary. Such awards will be issued in the form of restricted stock units. Of such restricted stock units, 50% of the restricted stock units will vest on the first anniversary of the grant date, and 50% of the restricted stock units will vest in equal one-third increments on each anniversary of the grant date, in each instance subject to his continued employment with us on the applicable vesting date and satisfying the key performance indicators and other performance criteria. The above bonus and equity grants are subject to our “clawback” policies.

 

If Mr. Battaglia’s employment is terminated by us other than for Cause (which includes willful material misconduct and willful failure to materially perform his responsibilities to our company), he is entitled to receive severance equal to the number of months of his actual employment under the employment agreement prior to the termination capped at a maximum payment of 12 months of his base salary. If there is a buy-out or a “change of control,” Mr. Battaglia will also be entitled to obtain his base salary for a period of 12 months as a severance payment.

 

Mr. Battaglia also entered into our standard Employee Confidentiality and Assignment of Inventions Agreement prohibiting him from disclosure of confidential and/or proprietary information relating to the operations, products and services of our company and our clients. Mr. Battaglia further agreed that during his employment with our company and for 12 months thereafter he will not engage in or support any business or activity that competes with our business within 60 miles from any company location or his primary work location, unless his employment ends without Cause or he obtains a non-competing position elsewhere, and he will refrain from soliciting our company’s customers during this period.

 

Retirement and Savings Plan – 401(k)

 

We maintain a tax qualified retirement plan (the “401(k) Plan”) that provides eligible employees with an opportunity to save for retirement on a tax advantaged basis. Eligible employees may participate in the 401(k) Plan on the entry date coincident with or following the date they meet the 401(k) Plan’s age and service eligibility requirements. The entry date is either January 1 or July 1. In order to meet the age and service eligibility requirements, otherwise eligible employees must be 21 or older and complete three consecutive months of employment. Participants are able to defer up to 100% of their eligible compensation subject to applicable annual Code limits. All participants’ interest in their deferrals are 100% vested when contributed. Currently, the 401(k) Plan does not provide for any matching contributions on employee deferrals.

 

35
 

 

Incentive Compensation Plans

 

In July 2018, our Board adopted the 2018 Plan. The holders of a majority of our shares of common stock approved the 2018 Plan at our stockholders meeting held on September 7, 2018. The 2018 Plan enables us to grant stock options, restricted stock, dividend equivalents, stock payments, deferred stock, restricted stock units, stock appreciation rights, performance share awards, and other incentive awards to employees, directors, consultants and advisors, and to improve our ability to attract, retain and motivate individuals upon whom our sustained growth and financial success depend, by providing such persons with an opportunity to acquire or increase their proprietary interest in us. Stock options granted under the 2018 Plan may be non-qualified stock options or incentive stock options, within the meaning of Section 422(b) of the Code, except that stock options granted to outside directors and any consultants or advisers providing services to us or an affiliate shall in all cases be non-qualified stock options. The option price must be at least 100% of the fair market value on the date of grant and if, issued to a 10% or greater stockholder, must be at least 110% of the fair market value on the date of the grant.

 

The 2018 Plan is administered by the Compensation Committee of the Board, which has discretion over the awards and grants thereunder. At our stockholders meeting held on July 24, 2023, stockholders approved an amendment to the 2018 Plan to increase the aggregate maximum number of shares of common stock for which stock options or awards may be granted pursuant to the 2018 Plan from 5,000,000 to 7,000,000. No awards may be issued on or after September 7, 2028.

 

As of December 31, 2023, stock options to purchase an aggregate of 936,245 shares of common stock and 3,619,555 restricted shares of our common stock were outstanding and issued to employees and members of the Board under the 2018 Plan.

 

Compensation Committee Interlocks and Insider Participation

 

No member of the Compensation Committee was an officer or employee of our company or any subsidiary of our company during the fiscal year ended December 31, 2023. No member of the Compensation Committee was a member of the compensation committee of another entity during the fiscal year ended December 31, 2023. None of our executive officers was a director or a member of the compensation committee of another entity during the fiscal year ended December 31, 2023. There were no transactions between any member of the Compensation Committee and our company during the year ended December 31, 2023 requiring disclosure pursuant to Item 404 of Regulation S-K promulgated under the Exchange Act.

 

Pay Ratio Disclosure

 

As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, our company is providing the following information about the relationship between the annual total compensation of our employees and the annual total compensation of Messrs. Farkas and Jones, who both served as the Chief Executive Officer during 2023. The CEO pay ratio figures below are a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K under the Exchange Act.

 

As of December 31, 2023, we had 706 employees, including 684 full-time employees.

 

We determined the total annual compensation for our employees for the year ended December 31, 2023 using data from our payroll records for the month of December 2023, which we then extrapolated for the full year of 2023. The components of total annual compensation for our employees are the same as those used to determine the total compensation of our NEOs for the purposes of the Summary Compensation Table. Total annual compensation for our current CEO was annualized based on the employment agreement entered into in May 2023. We did not make any full-time equivalent adjustments for part-time employees. The results were then ranked, excluding the Chief Executive Officer, from lowest to highest, and the median employee was identified. We then compared the total annual compensation of the median employee to that of the Chief Executive Officer. The total annual compensation of the median employee for the year ended December 31, 2023 was $54,195. For the year ended December 31, 2023, the ratio of our Chief Executive Officer’s total annual compensation to that of our median employee was approximately 33:1.

 

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The SEC rules for identifying the median employee and calculating the pay ratio based on that employee’s total annual compensation allow companies to adopt a variety of methodologies, to apply certain exclusions and to make reasonable estimates and assumptions that reflect their compensation practices. As such, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies may have different employment and compensation practices and may utilize different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios.

 

Pay Versus Performance

 

In accordance with rules adopted by the SEC pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, the following table describes the executive compensation for our Chief Executive Officer, who is our principal executive officer, the former Chief Executive Officer and the other NEOs, and our company’s performance for the four most recently completed fiscal years.

 

Year  Summary Compensation Table Total for PEO – Michael D. Farkas1   Summary Compensation Table Total for PEO – Brendan S. Jones2   Compensation Actually Paid to PEO – Michael D. Farkas3   Compensation Actually Paid to PEO – Brendan S. Jones3   Average Summary Compensation Table Total for Non-PEO NEOs4  

Average Compen-

sation Actually

Paid to Non-PEO NEOs5

  

Total Share-

holder Return6

  

Peer

Group

Total

Share-

holder Return7

   Net Loss (in thous-ands)8   Revenue (in thou-sands)9 
                           Value of Initial Fixed $100 Investment Based On:         
Year  Summary Compensation Table Total for PEO – Michael D. Farkas1   Summary Compensation Table Total for PEO – Brendan S. Jones2   Compensation Actually Paid to PEO – Michael D. Farkas3   Compensation Actually Paid to PEO – Brendan S. Jones3   Average Summary Compensation Table Total for Non-PEO NEOs4  

Average Compen-

sation Actually

Paid to Non-PEO NEOs5

  

Total Share-

holder Return6

  

Peer

Group

Total

Share-

holder Return7

   Net Loss (in thous-ands)8   Revenue (in thou-sands)9 
2023  $11,137,081   $1,513,341   $8,317,523   $1,022,033   $2,150,570   $1,998,564   $182.26   $148.09   $(203,693)  $140,598 
2022  $15,877,812   $-   $4,187,889  $-   $1,585,440  $614,106   $589.78   $119.57   $(91,560)  $61,139 
2021  $18,003,751   $-   $9,729,230  $-   $1,595,865.25  $563,947   $1,425.27   $155.03   $(55,119)  $20,940 
2020  $943,757   $-   $5,402,379  $-   $622,999  $4,749,775   $2,298.39   $135.68   $(17,846)  $6,231 

 

(1) During fiscal year 2020, 2021, 2022 and part of fiscal year 2023, Mr. Farkas served as our Principal Executive Officer (“PEO”). The dollar amounts reported in this column are the amounts of total compensation reported for each corresponding year in the Total column of the Summary Compensation Table.

 

(2) During part of fiscal year 2023, Mr. Jones served as our PEO. The dollar amounts reported in this column are the amounts of total compensation reported for each corresponding year in the Total column of the Summary Compensation Table.

 

  The dollar amounts reported in this column represent the amount of “compensation actually paid” to Messrs. Farkas and Jones as computed in accordance with Item 402(v) of Regulation S-K. The amounts do not reflect the actual amount of compensation earned by or paid to Messrs. Farkas and Jones during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to Messrs. Farkas’ and Jones’ total compensation for each year to determine the compensation actually paid:

 

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   Mr. Farkas   Mr. Jones 
Summary Compensation Table Total  $11,137,081   $1,513,341 
Less, Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year  $(4,690,000)  $(258,875)
Plus, Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year  $0   $56,620 
Plus, Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Years  $0   $(346,651)
Plus, Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year that Vested During Fiscal Year  $4,594,523   $129,441 
Plus, Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years for which Applicable Vesting Conditions Were Satisfied During Fiscal Year  $(1,343,538)  $(71,842)
Less, Fair Value as of Prior Fiscal Year-End of Option Awards and Stock Awards Granted in Prior Fiscal Years that Failed to Meet Applicable Vesting Conditions During Fiscal Year  $(1,380,543)  $0 
Compensation Actually Paid  $8,317,523   $1,022,033 

 

(4) The dollar amounts reported represent the average of the amounts reported for the company’s NEOs as a group (excluding Mr. Farkas and Mr. Jones for 2023) in the “Total” column of the Summary Compensation Table in each applicable year. The NEOs (excluding Mr. Farkas and Mr. Jones for 2023) included for purposes of calculating the average amounts in each applicable year are as follows: (i) for 2023, M. Rama, A. Hillo, H. Bhade, and M. Battaglia; (ii) for 2022 and 2021, B. Jones, M. Rama, A. Hillo, and H. Bhade; and (iii) for 2021, B. Jones and M. Rama.

 

(5) The dollar amounts reported in this column represent the average amount of “compensation actually paid” to the Non-PEO NEOs as a group as identified in footnote 4 above, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual average of compensation earned by or paid to these NEOs as a group during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to the average total compensation for these NEOs as a group for each year to determine the compensation actually paid.
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Average Non-PEO NEOs  2023 
Summary Compensation Table Total  $2,150,570 
Less, Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year  $(157,073)
Plus, Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year  $40,316 
Plus, Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Years  $(153,842)
Plus, Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year that Vested During Fiscal Year  $154,168 
Plus, Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years for which Applicable Vesting Conditions Were Satisfied During Fiscal Year  $(35,575)
Less, Fair Value as of Prior Fiscal Year-End of Option Awards and Stock Awards Granted in Prior Fiscal Years that Failed to Meet Applicable Vesting Conditions During Fiscal Year  $0 
Compensation Actually Paid to Non-PEO NEOs  $1,998,564 

 

(6) Cumulative total shareholder return is calculated by dividing the sum of the cumulative amount of dividends for the measurement period, assuming dividend reinvestment, and the difference between the share price at the end and the beginning of the measurement period by the share price at the beginning of the measurement period. For purposes of these amounts, the beginning of the measurement period is December 31, 2020.

 

(7) Represents the weighted peer group total shareholder return, weighted according to the respective companies’ respective stock market capitalization at the beginning of each period for which a return is indicated. The peer group used for this purpose is the following published index: MSCI ACWI: Electrical Equipment. The 2022 proxy statement misidentified the MSCI ACWI: Electrical Equipment as the S&P 500 index.

 

(8) The dollar amounts reported represent the amount of net income reflected in our company’s audited financial statements for the applicable year.

 

(9) This column is the “Designated as the Company-Selected Measure,” which in the registrant’s assessment represents the most important financial performance measure (that is not otherwise required to be disclosed in the table) used by the registrant to link compensation actually paid to the registrant’s NEOs, for the most recently completed fiscal year, to company performance.

 

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Relationships Between Certain Data in the Pay Versus Performance Table

 

Description of Relationship Between PEO and Non-PEO NEO Compensation Actually Paid and Total Shareholder Return

 

The following chart sets forth the relationship between (i) our company’s cumulative total shareholder return over the four most recently completed fiscal years and the MSCI ACWI: Electrical Equipment index’s cumulative total shareholder return over the same period, and (ii) the compensation actually paid to our PEO and the average compensation actually paid to our Non-PEO NEOs.

 

 

40
 

 

Description of Relationship Between PEO and Non-PEO NEO Compensation Actually Paid and Net Income

 

The following chart sets forth the relationship between compensation actually paid to our PEO, the average of compensation actually paid to our Non-PEO NEOs and our net income during the four most recently completed fiscal years.

 

 

 

Description of Relationship Between PEO and Non-PEO NEO Compensation Actually Paid and Revenue

 

The following chart sets forth the relationship between compensation actually paid to our PEO, the average of compensation actually paid to our Non-PEO NEOs and our revenue during the four most recently completed fiscal years.

 

 

41
 

 

Tabular List of Most Important Financial Performance Measures

 

We selected the following measures as most important to link compensation actually paid to our NEOs for fiscal year 2023 to company performance.

 

Most Important Measures for Determining PEO and Non-PEO NEO Pay
Revenue
Sales
Capital Raise

 

Director Compensation Discussion

 

Compensation of Directors

 

The following table provides information for 2023 regarding all compensation awarded to, earned by or paid to each person who served as a director for all or some portion of 2023:

 

 

Name 

Fees

Earned

or Paid

in Cash

($)

  

Stock

Awards(1) ($)

  

Option

Awards

($)

  

Non-Equity

Incentive Plan

Compensation ($)

  

Change in

Pension Value

and

Nonqualified Deferred

Compensation

Earnings

  

All Other

Compensation

   Total 
Louis R. Buffalino(2)  $56,522   $-   $      -   $        -                -   $-   $56,522 
                                    
Jack Levine  $113,324   $150,000   $-   $-    -   $-   $263,324 
                                    
Kenneth R. Marks(2)  $55,109   $-   $-   $-    -   $-   $55,109 
                                    
Ritsaart J.M. van Montfrans  $126,703   $180,000   $-   $-    -   $-   $306,703 
                                    
Mahidhar (Mahi) Reddy(3)  $-   $-   $-   $-    -   $466,646   $466,646 
                                    
Kristina A. Peterson  $64,354   $150,000   $-   $-    -   $-   $214,354 
                                    
Cedric L. Richmond  $92,500   $150,000   $-   $-   $-   $-   $242,500 
                                    
Total  $508,512   $630,000   $-   $-   $-   $466,646   $1,605,158