YOUR VOTE IS IMPORTANT. We urge you to submit your vote via the Internet, telephone or mail.
|
|
| |
By order of the Board of Directors,
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Jayshree Ullal
Chief Executive Officer, President and Director Santa Clara, California April 15, 2020 |
2020 Proxy Statement
|
| |
|
| |
i
|
|
| |
Page
|
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
|
| |
|
| | ||
|
| |
|
| | ||
| | ||
| | ||
| | ||
|
| |
|
| | ||
| |
ii
|
| |
|
| |
2020 Proxy Statement
|
|
Date and Time:
|
| |
Wednesday, May 27, 2020 at 11:00 a.m. Pacific Time
|
|
|
Virtual Meeting:
|
| |
www.virtualshareholdermeeting.com/ANET2020
|
|
|
Record Date:
|
| |
April 2, 2020
|
|
Q:
|
What matters am I voting on?
|
|
Proposals for your Vote
|
| |
Board Voting Recommendation
|
| |
Page
|
|
|
1. Election of two Class III directors to serve until the 2023 annual meeting of stockholders
|
| |
✔
FOR the election of Mark Templeton and Nikos Theodosopoulos |
| | | |
|
2. Advisory vote to approve named executive officer compensation
|
| |
✔
FOR |
| | | |
|
3. Ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm
|
| |
✔
FOR |
| | |
Q:
|
Who is entitled to vote?
|
A:
|
Holders of our common stock as of the close of business on April 2, 2020, the record date, may vote at the Annual Meeting. As of the record date, there were 75,658,741 shares of our common stock outstanding. In deciding all matters at the Annual Meeting, each stockholder will be entitled to one vote for each share of our common stock held by them on the record date. We do not have cumulative voting rights for the election of directors.
|
2020 Proxy Statement
|
| |
|
| |
1
|
Q:
|
What is a quorum?
|
A:
|
A quorum is the minimum number of shares required to be present at the Annual Meeting for the Annual Meeting to be properly held under our amended and restated bylaws and Delaware law. The presence (including by proxy) of a majority of all issued and outstanding shares of our common stock entitled to vote at the Annual Meeting will constitute a quorum at the Annual Meeting. Abstentions, withhold votes and broker non-votes are counted as shares present and entitled to vote for purposes of determining a quorum.
|
Q:
|
How do I vote?
|
A:
|
If you are a stockholder of record, you can vote in one of the following ways:
|
•
|
by Internet at http://www.proxyvote.com, 24 hours a day, seven days a week, until 11:59 p.m. EST on May 26, 2020 (have your proxy card in hand when you visit the website);
|
•
|
by toll-free telephone at 1-800-690-6903 until 11:59 p.m. EST on May 26, 2020 (have your proxy card in hand when you call);
|
•
|
by signing, dating, and returning your proxy card (if you received printed proxy materials); or
|
•
|
by voting at the Annual Meeting by following the instructions at www.virtualshareholdermeeting.com/ANET2020. To attend and participate in the Annual Meeting, you will need your control number included in your Notice and Access Card, on your proxy card or on instructions that accompanied your proxy materials. If you are a street name stockholder, you should contact your broker, bank or other nominee to obtain your control number or otherwise vote through the broker, bank or other nominee.
|
2
|
| |
|
| |
2020 Proxy Statement
|
Q:
|
Can I change my vote?
|
A:
|
Yes. Subject to the voting deadlines noted above, if you are a stockholder of record, you can change your vote or revoke your proxy any time before the Annual Meeting by:
|
•
|
entering a new vote by Internet or by telephone;
|
•
|
returning a later-dated proxy card;
|
•
|
notifying the Secretary of Arista Networks, Inc., in writing, at Arista Networks, Inc., 5453 Great America Parkway, Santa Clara, California 95054; or
|
•
|
attending and voting at the Annual Meeting at www.virtualshareholdermeeting.com/ANET2020.
|
Q:
|
Do I have to do anything in advance if I plan to attend the Annual Meeting?
|
A:
|
The Annual Meeting will be a completely virtual meeting, which will be conducted via a live webcast. You are entitled to participate in the annual meeting only if you were a holder of our common stock as of the close of business on April 2, 2020 or if you hold a valid proxy for the Annual Meeting.
|
Q:
|
How do I ask questions during the Annual Meeting?
|
A:
|
You will be able to attend the Annual Meeting online and submit your questions during the meeting at www.virtualshareholdermeeting.com/ANET2020 and entering your control number included in your Notice of Internet Availability Materials, on your proxy card or on the instructions that accompanied your proxy materials. Once past the login screen, click on “Question for Management,” type in your question, and click “Submit.”
|
Q:
|
How can I get help if I have trouble checking in or listening to the meeting online?
|
A:
|
If you encounter any difficulties accessing the virtual meeting during the check-in or meeting time, please call the technical support number that will be posted on the Virtual Shareholder Meeting log-in page.
|
Q:
|
What is the effect of giving a proxy?
|
A:
|
Proxies are solicited by and on behalf of our board of directors. Jayshree Ullal, Ita Brennan and Marc Taxay have been designated as proxies by our board of directors. When a proxy is properly dated, signed and returned, the shares represented by such proxy will be voted at the Annual Meeting in accordance with the instructions of the stockholder contained on such proxy. If no specific instructions are given, however, the
|
2020 Proxy Statement
|
| |
|
| |
3
|
Q:
|
Why did I receive a Notice of Internet Availability of Proxy Materials instead of a full set of proxy materials?
|
A:
|
In accordance with the rules of the Securities and Exchange Commission (“SEC”), we have elected to furnish our proxy materials, including this proxy statement and our annual report, primarily via the Internet. The Notice containing instructions on how to access our proxy materials is first being mailed on or about April 15, 2020 to all stockholders entitled to vote at the Annual Meeting. Stockholders may request to receive all future proxy materials in printed form by mail or electronically by e-mail by following the instructions contained in the Notice. We encourage stockholders to take advantage of the availability of our proxy materials on the Internet to help reduce the environmental impact of our annual meetings of stockholders.
|
Q:
|
How are proxies solicited for the Annual Meeting?
|
A:
|
Our board of directors is soliciting proxies for use at the Annual Meeting. All expenses associated with this solicitation will be borne by us. Copies of solicitation materials will also be made available upon request to brokers, banks and other nominees to forward to the beneficial owners of the shares held of record by such brokers, banks or other nominees. The original solicitation of proxies may be supplemented by solicitation by telephone, electronic communication, or other means by our directors, officers and employees.
|
Q:
|
How may my brokerage firm or other intermediary vote my shares if I fail to provide timely directions?
|
A:
|
Brokerage firms and other intermediaries holding shares of our common stock in street name for customers are generally required to vote such shares in the manner directed by their customers. In the absence of timely directions, your broker will have discretion to vote your shares on our sole “routine” matter: the proposal to ratify the appointment of Ernst & Young LLP. Your broker will not have discretion to vote on the election of directors or on the approval, on an advisory basis, of executive compensation of our named executive officers, which are “non-routine” matters, absent direction from you.
|
Q:
|
Why hold a virtual Annual Meeting?
|
A:
|
We decided to hold a virtual meeting this year because of the public health risks associated with gathering our management, directors and stockholders for an in-person meeting during the coronavirus pandemic. We believe this format will also allow for greater participation of our stockholders, particularly since our stockholders’ travel may be restricted due to coronavirus. Also, our stockholders will maintain the same rights as they would have at an in-person meeting since they will have the opportunity to ask questions online.
|
4
|
| |
|
| |
2020 Proxy Statement
|
Q:
|
Where can I find the voting results of the Annual Meeting?
|
A:
|
We will announce preliminary voting results at the Annual Meeting. We will also disclose voting results on a Current Report on Form 8-K that we will file with the SEC within four business days after the Annual Meeting. If final voting results are not available to us in time to file a Current Report on Form 8-K within four business days after the Annual Meeting, we will file a Current Report on Form 8-K to publish preliminary results and will provide the final results in an amendment to this Current Report on Form 8-K as soon as they become available.
|
Q:
|
I share an address with another stockholder and we received only one paper copy of the proxy materials. How may I obtain an additional copy of the proxy materials?
|
A:
|
We have adopted a procedure called “householding,” which the SEC has approved. Under this procedure, stockholders of record who have the same address and last name and have not previously requested electronic delivery of proxy materials will receive a single envelope containing the Notices for all stockholders having that address. The Notice for each stockholder will include that stockholder's unique control number needed to vote his or her shares. This procedure reduces our printing costs, mailing costs, and fees. Upon written or oral request, we will deliver promptly a separate copy of the Notice and, if applicable, our proxy materials to any stockholder at a shared address to which we delivered a single copy of any of these materials. To receive a separate copy, or, if a stockholder is receiving multiple copies, to request that we only send a single copy of the Notice and, if applicable, our proxy materials, such stockholder may contact us at the following phone number (408) 547-5500 or address:
|
Q:
|
What is the deadline to propose actions for consideration at next year’s annual meeting of stockholders or to nominate individuals to serve as directors?
|
A:
|
Stockholder Proposals
|
2020 Proxy Statement
|
| |
|
| |
5
|
•
|
not earlier than the close of business on January 30, 2021; and
|
•
|
not later than the close of business on March 1, 2021.
|
6
|
| |
|
| |
2020 Proxy Statement
|
2020 Proxy Statement
|
| |
|
| |
7
|
*
|
M = Member; C = Chair
|
**
|
Independent director under the listing standards of the New York Stock Exchange and SEC rules and regulations
|
|
|
| |
|
| |
|
| |
|
| |
|
| |
Board Committees
|
| ||||||
|
Name
|
| |
Class
|
| |
Age
|
| |
Director
Since |
| |
Current
Term Expires |
| |
Audit
|
| |
Comp.
|
| |
Nom.
& Gov. |
|
|
Continuing Directors
|
| |||||||||||||||||||||
|
Andreas Bechtolsheim
|
| |
I
|
| |
64
|
| |
2004
|
| |
2021
|
| |
|
| |
|
| |
|
|
|
Jayshree Ullal
|
| |
I
|
| |
59
|
| |
2008
|
| |
2021
|
| |
|
| |
|
| |
|
|
|
Charles Giancarlo**
|
| |
II
|
| |
62
|
| |
2013
|
| |
2022
|
| |
|
| |
C
|
| |
M
|
|
|
Ann Mather**
|
| |
II
|
| |
59
|
| |
2013
|
| |
2022
|
| |
C
|
| |
|
| |
|
|
|
Daniel Scheinman**
|
| |
II
|
| |
57
|
| |
2011
|
| |
2022
|
| |
|
| |
M
|
| |
C
|
|
*
|
M = Member; C = Chair
|
**
|
Independent director under the listing standards of the New York Stock Exchange and SEC rules and regulations
|
8
|
| |
|
| |
2020 Proxy Statement
|
2020 Proxy Statement
|
| |
|
| |
9
|
10
|
| |
|
| |
2020 Proxy Statement
|
2020 Proxy Statement
|
| |
|
| |
11
|
12
|
| |
|
| |
2020 Proxy Statement
|
•
|
calling meetings of outside directors when necessary and appropriate;
|
•
|
being available, when appropriate, for consultation and direct communication with the Company’s stockholders;
|
•
|
building a productive relationship between the board of directors and the CEO;
|
•
|
ensuring that the board of directors fulfills its oversight responsibilities in Company strategy, risk oversight and succession planning; and
|
•
|
performing such other duties as the board of directors may from time to time designate.
|
2020 Proxy Statement
|
| |
|
| |
13
|
•
|
providing oversight of our accounting and financial reporting processes and the audit of our financial statements;
|
•
|
assisting the board of directors in oversight of (i) the integrity of our financial statements, (ii) our compliance with legal and regulatory requirements, (iii) the independent auditor’s qualifications, independence and performance, (iv) our internal accounting and financial controls, and (v) the organization and performance of our internal audit function;
|
•
|
serving as the Qualified Legal Compliance Committee to receive, evaluate, investigate and recommend appropriate responses, as applicable, with respect to any reports of evidence of material violations with regards to us;
|
•
|
providing to our board of directors such information and materials as it may deem necessary to make our board of directors aware of significant financial matters that require the attention of our board of directors; and
|
•
|
preparing the report required by the SEC rules to be included in our proxy statement for the annual meeting of stockholders.
|
14
|
| |
|
| |
2020 Proxy Statement
|
•
|
providing oversight of our compensation policies, plans, benefits programs and overall compensation philosophy;
|
•
|
assisting our board of directors in discharging its responsibilities relating to (i) oversight of the compensation of our Chief Executive Officer, the Chief Development Officer and other executive officers, and (ii) approving and evaluating our executive officer compensation plans, policies and programs; and
|
•
|
administering our equity compensation plans for our employees.
|
•
|
reviewing and making recommendations regarding corporate governance; the composition of our board of directors and its committees;
|
•
|
identifying, evaluating and nominating director candidates;
|
•
|
reviewing conflicts of interest;
|
•
|
reviewing and making recommendations regarding the education of our board of directors; and
|
•
|
leading the annual performance review of the board of directors, its committees and management.
|
2020 Proxy Statement
|
| |
|
| |
15
|
16
|
| |
|
| |
2020 Proxy Statement
|
|
Ethical Business Conduct
|
| |||
|
•
|
| |
Our Code of Ethics and Business Conduct (the “Code”) emphasizes the importance of honest business conduct and solid business ethics. The Code applies to all personnel employed by or engaged to provide services to the Company including, but not limited to, our employees, officers and directors, including our Chief Executive Officer, Chief Financial Officer, and other executive and senior financial officers. The Code addresses, among other things, conflicts of interest, business practices, compliance with laws and regulations, and interacting fairly and respectfully with each other, our customers, partners suppliers and host communities. The full text of our Corporate Governance Guidelines and our Code of Ethics and Business Conduct are posted on the Governance section of our website at http://investors.arista.com.
|
|
|
People
|
| |||
|
•
|
| |
We seek to maintain an environment that is open, diverse and inclusive, and where our people feel valued, included and accountable. We believe that diverse and inclusive teams create enhanced performance and help us attract and retain the best talent.
|
|
|
|
| |
|
|
|
•
|
| |
We promote hiring female engineers by hosting periodic onsite technology sessions for female engineers.
|
|
|
Health and Safety
|
| |||
|
•
|
| |
We are committed to protecting the health and safety of our employees, visitors, and the public. Our policy is to maintain our facilities and run our business operations in a manner that does not jeopardize the occupational health and safety of employees.
|
|
|
|
| |
|
|
|
•
|
| |
We promote health through onsite wellness events.
|
|
2020 Proxy Statement
|
| |
|
| |
17
|
|
Social Responsibility
|
| |||
|
•
|
| |
We maintain a community engagement program and its purpose is to provide opportunities for our employees to engage in community service. In 2019, we participated in volunteer opportunities with Resource Area For Teaching (which helps educators transform the learning experiences through hands-on activities), Our City Forest (which promotes urban forestry and environmental education), Second Harvest Food Bank, The Tech Challenge at The Tech Museum of Innovation (where student teams used engineering design processes to solve real-world problems), Engineer 4 Tomorrow (E4T) (which focuses on introducing children to STEM education), and Bay Area Ridge Trail – City of San Jose (where we cleaned- up Todd Quick Trail and the surrounding areas at Alum Rock Park).
|
|
|
|
| |
|
|
|
•
|
| |
Through our foundation, Arista gives annually to various non-profit organizations. Our foundation focuses on giving to non-profit organizations dedicated to education and environmental sustainability projects. In 2019, Arista donated funds to the Second Harvest Food Bank, Forest Planet Inc., NPower Inc., Sesame Workshop, St. Jude Children’s Research Hospital, and Children’s Wish Foundation.
|
|
|
|
| |
|
|
|
•
|
| |
We are committed to responsible sourcing of materials for our products. We are a member of the Responsible Minerals Initiative (“RMI”) and have management systems in place to ensure that the components are sourced responsibly. Arista’s suppliers are asked to take reasonable due diligence to determine if the minerals that they use are sourced from certified conflict-free smelters, which are validated by the RMI.
|
|
|
Environmental
|
| |||
|
LEED Gold Certification
|
| |||
|
|
| |
|
|
|
•
|
| |
When we select our office space, we ensure that we have an office that not only meets our needs, but also aids us in reducing our impact to the environment. Our Santa Clara headquarters and our San Francisco office are both LEED Gold certified. The certification, awarded by the US Green Building Council, is based on the properties’ use of sustainable materials, water and energy efficiency, indoor environmental quality, location and transportation and overall innovation.
|
|
|
|
| |
|
|
|
Electronic Industry Citizenship Coalition Membership
|
| |||
|
|
| |
|
|
|
•
|
| |
Arista is a member of the Responsible Business Alliance (“RBA”) and supports the RBA’s vision and mission, which strives to develop a global electronics industry supply chain that consistently operates with social, environmental and economic responsibility through a common code of conduct, collaborative efforts and shared tools and practices. Arista is committed to progressively aligning its own operations with the RBA code of conduct and encourages its own first-tier suppliers to do the same.
|
|
|
|
| |
|
|
|
Design for Environment
|
| |||
|
|
| |
|
|
|
•
|
| |
We are committed to integrating sustainability in every aspect of our product's life cycle, from the materials that make up our products, all the way to the end of life of the product, while meeting our customer's requirements. For example, we have implemented Design for Environment principles in our development process with the goal of minimizing the overall adverse environmental impact of our products, with a focus on the reduction of material diversity and weight, selection of more environmentally friendly materials, ease of disassembly and recycling, energy efficiency, design for longevity and upgradeability, and design for efficient packaging.
|
|
|
|
| |
|
|
|
Product Recycling
|
| |||
|
|
| |
|
|
|
•
|
| |
As a producer of hardware products, Arista offers a takeback and recycle program in our U.S. and European markets, which allows our customers to return end of life products and ensures that our products are disposed of in an environmentally safe manner.
|
|
18
|
| |
|
| |
2020 Proxy Statement
|
2020 Proxy Statement
|
| |
|
| |
19
|
|
Director
|
| |
Fees Earned
or Paid in Cash ($)(1) |
| |
Stock
Awards ($)(2) |
| |
Option
Awards ($) |
| |
Total ($)
|
|
|
Charles Giancarlo
|
| |
97,000
|
| |
667,044
|
| |
—
|
| |
764,044
|
|
|
Ann Mather
|
| |
100,000
|
| |
667,044
|
| |
—
|
| |
767,044
|
|
|
Daniel Scheinman
|
| |
130,750
|
| |
667,044
|
| |
—
|
| |
797,794
|
|
|
Mark Templeton
|
| |
95,000
|
| |
—
|
| |
—
|
| |
95,000
|
|
|
Nikos Theodosopoulos
|
| |
95,000
|
| |
—
|
| |
—
|
| |
95,000
|
|
(1)
|
The amount reported represents the fees earned for service on our board of directors and committees of our board of directors for 2019.
|
(2)
|
Stock awards to directors elected at an annual meeting vest over a period of 3 years.
|
|
Director
|
| |
Stock
Awards (#)(1) |
| |
Option
Awards (#) |
|
|
Charles Giancarlo
|
| |
7,194(2)
|
| |
—
|
|
|
Ann Mather
|
| |
2,194
|
| |
13,844
|
|
|
Daniel Scheinman
|
| |
2,194
|
| |
28,000
|
|
|
Mark Templeton
|
| |
873
|
| |
—
|
|
|
Nikos Theodosopoulos
|
| |
873
|
| |
22,500
|
|
(1)
|
Represents the number of restricted stock units unvested as of December 31, 2019.
|
(2)
|
This number includes 5,000 shares of restricted stock issued upon the early exercise of stock options that remained unvested as of December 31, 2019, which are subject to a repurchase right held by us at their original exercise prices in the event Mr. Giancarlo’s service on our board is terminated.
|
20
|
| |
|
| |
2020 Proxy Statement
|
•
|
a $75,000 cash retainer for general board service, except that our lead independent director will receive a $120,000 cash retainer;
|
•
|
a $25,000 cash retainer for chairing the audit committee
|
•
|
a $12,000 cash retainer for chairing the compensation committee;
|
•
|
a $12,000 cash retainer for chairing the nominating and corporate governance committee;
|
•
|
a $10,000 cash retainer for service on each committee.
|
2020 Proxy Statement
|
| |
|
| |
21
|
•
|
Mark Templeton and
|
•
|
Nikos Theodosopoulos.
|
|
THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR”
EACH OF THE NOMINEES NAMED ABOVE. |
|
22
|
| |
|
| |
2020 Proxy Statement
|
|
THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE APPROVAL OF THE ADVISORY RESOLUTION ON EXECUTIVE COMPENSATION.
|
|
2020 Proxy Statement
|
| |
|
| |
23
|
|
|
| |
2018
|
| |
2019
|
|
|
|
| |
(In Thousands)
|
| |||
|
Audit Fees(1)
|
| |
$2,503
|
| |
$2,495
|
|
|
Audit-Related Fees(2)
|
| |
36
|
| |
304
|
|
|
Tax Compliance Fees(3)
|
| |
1,450
|
| |
1,236
|
|
|
Tax Advice and Planning Fees(4)
|
| |
1,979
|
| |
1,161
|
|
|
All Other Fees(5)
|
| |
—
|
| |
—
|
|
|
Total Fees
|
| |
$5,968
|
| |
$5,196
|
|
(1)
|
Audit Fees consist of professional services rendered in connection with the audit of our annual consolidated financial statements, including audited financial statements presented in our Annual Report on Form 10-K and services that are normally provided by the independent registered public accountants in connection with statutory and regulatory filings or engagements for those fiscal years.
|
(2)
|
Audit-Related Fees consist of fees for professional services for assurance and related services that are reasonably related to the performance of the audit or review of our consolidated financial statements and are not reported under “Audit Fees.” These services include accounting consultations concerning financial accounting and reporting standards.
|
(3)
|
Tax Compliance Fees consist of fees for tax compliance and the preparation of original and amended tax returns and refund claims.
|
(4)
|
Tax Advice and Planning Fees consist of fees for tax advice and tax planning assistance, including non-recurring tax assistance in connection with acquisitions and intellectual property alignment.
|
(5)
|
All Other Fees consist of fees billed for products and services provided by the independent registered public accountants other than those that meet the criteria above.
|
24
|
| |
|
| |
2020 Proxy Statement
|
|
THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP.
|
|
2020 Proxy Statement
|
| |
|
| |
25
|
•
|
reviewed and discussed the audited financial statements with management and EY;
|
•
|
discussed with EY the matters required to be discussed by Auditing Standard No. 1301, “Communications with Audit Committees,” as issued by the Public Company Accounting Oversight Board, and the Securities and Exchange Commission; and
|
•
|
received the written disclosures and the letter from EY required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent accountant’s communications with the audit committee concerning independence, and has discussed with EY its independence.
|
26
|
| |
|
| |
2020 Proxy Statement
|
|
Name
|
| |
Age
|
| |
Position
|
|
|
Jayshree Ullal
|
| |
59
|
| |
Chief Executive Officer, President and Director
|
|
|
Andreas Bechtolsheim
|
| |
64
|
| |
Founder, Chief Development Officer, Director and Chairman of the Board of Directors
|
|
|
Ita Brennan
|
| |
53
|
| |
Senior Vice President, Chief Financial Officer
|
|
|
Kenneth Duda
|
| |
48
|
| |
Founder, Chief Technology Officer and Senior Vice President, Software Engineering
|
|
|
John McCool
|
| |
60
|
| |
Chief Platform Officer, Senior Vice President of Engineering Operations
|
|
|
Anshul Sadana
|
| |
43
|
| |
Chief Operating Officer
|
|
|
Marc Taxay
|
| |
51
|
| |
Senior Vice President, General Counsel
|
|
2020 Proxy Statement
|
| |
|
| |
27
|
28
|
| |
|
| |
2020 Proxy Statement
|
•
|
Jayshree Ullal, our President and Chief Executive Officer;
|
•
|
Ita Brennan, our Chief Financial Officer;
|
•
|
Kenneth Duda, our Chief Technology Officer and Senior Vice President of Software Engineering;
|
•
|
Anshul Sadana, our Chief Operating Officer; and
|
•
|
Marc Taxay, our Senior Vice President, General Counsel
|
|
What We Do
|
| |
What We Do Not Do
|
|
|
✔ Annual Review. Annual review of our executive
compensation program.
✔ CEO Performance-Based Equity. In 2020, we introduced performance-based equity as a significant part of our compensation program to
our Chief Executive Officer.
✔ Independence. Our compensation committee is made up solely of independent directors and
makes all executive compensation decisions.
✔ Compensation Consultant. Our compensation committee engages its own independent compensation consultant to assist with its
compensation reviews.
✔ Stock Ownership Guidelines. To align our chief executive officer’s long-term interests with those of our stockholders, our chief executive officer is required to own specified minimum levels of
Company’s stock.
|
| |
✘ No Executive-Only Retirement Programs. We do not offer pension arrangements, retirement plans, or nonqualified deferred compensation plans or arrangements to our executive officers, other than
the plans generally available to all employees.
✘ No Excise Tax Gross-Ups. We do not offer golden parachute tax gross-ups to any of our Named Executive Officers or other executive
officers.
✘ No “Single-Trigger” Benefits and Limited “Double Trigger” Benefits. Potential change in control payments and benefits are limited in nature and are received only in connection with the termination of employment without cause or for good reason in connection with or following a change in control.
|
|
2020 Proxy Statement
|
| |
|
| |
29
|
|
What We Do
|
| |
What We Do Not Do
|
|
|
✔ Clawback Policy. We may seek the recovery of cash incentive compensation and performance-based equity compensation paid to our executive officers.
|
| |
|
|
|
Revenue
|
| |
Revenue for our fiscal year 2019 was $2.41 billion, representing an increase of 12.1% compared to fiscal year 2018. This represented a deceleration in growth rate from prior years and resulted in a revenue amount that was somewhat below our internal targets, established at the beginning of the year. We executed well in expanding our enterprise datacenter and campus businesses, but this was offset by more muted demand for the year from our cloud customers. We exited the year with over 6,000 customers and continue to add new customers and expand our market presence and geographic footprint.
|
|
|
Operating Income
|
| |
Our non-GAAP operating income for fiscal year 2019 was $922.7 million or 38.3% of revenue, compared to $789.0 million or 36.7% of revenue for fiscal year 2018. This represented 16.9% growth in non-GAAP operating income on a year over year basis reflecting the deceleration in revenue growth outlined above combined with an expansion in operating margin. The ratio of non-GAAP operating income to revenue is a key metric for our stockholders as it provides a consistent measure of the profitability of our business and as a result we used non-GAAP operating income as a metric in our 2019 Bonus Plan (as defined below).
|
|
|
Industry Leadership
|
| |
Arista maintained a leadership position in the Gartner July 2019 Magic Quadrant for Data Center Networking for the fifth consecutive year.
|
|
30
|
| |
|
| |
2020 Proxy Statement
|
•
|
No Base Salary Increases - We did not increase base salaries for our Named Executive Officers.
|
•
|
Annual Bonuses Reflecting Pay for Performance - As noted above, our financial performance in fiscal 2019 achieved revenue of approximately $2.41 billion an increase of 12.1% over 2018 levels and a non-GAAP operating income to revenue ratio of 38.3%. These results combined with continued excellence in product innovation and customer quality and support, resulted in payments to our Named Executive Officers under the 2019 Bonus Plan. Despite our strong overall performance, our Chief Executive Officer declined a bonus for fiscal 2019.
|
•
|
Equity Awards Promoting Our Stockholders’ Interests - Long-term equity incentives constitute a significant majority of compensation paid to Named Executive Officers in 2019. Long-term equity incentives align the interests of executives with those of our stockholders. Further, a meaningful portion of the equity awards we granted to our Named Executive Officers in 2019 were in the form of options, which provide value only if our stock price increases during the term of the option.
|
2020 Proxy Statement
|
| |
|
| |
31
|
•
|
reward the successful achievement of our financial growth objectives;
|
•
|
drive the development of a successful and profitable business;
|
•
|
attract, motivate, reward, and retain highly qualified executives who are important to our success;
|
•
|
recognize strong performers by offering cash performance-based incentive compensation and equity awards that have the potential to reward individual achievement as well as contributions to our overall success; and
|
•
|
create value for our stockholders.
|
32
|
| |
|
| |
2020 Proxy Statement
|
2020 Proxy Statement
|
| |
|
| |
33
|
34
|
| |
|
| |
2020 Proxy Statement
|
2020 Proxy Statement
|
| |
|
| |
35
|
|
Named Executive Officer
|
| |
Base Salary
through 2019 |
|
|
Jayshree Ullal
|
| |
$300,000
|
|
|
Ita Brennan
|
| |
$300,000
|
|
|
Kenneth Duda
|
| |
$300,000
|
|
|
Anshul Sadana
|
| |
$300,000
|
|
|
MarcTaxay
|
| |
$300,000
|
|
36
|
| |
|
| |
2020 Proxy Statement
|
|
Named Executive Officer
|
| |
Actual Incentive
Compensation |
|
|
Ita Brennan
|
| |
$150,000
|
|
|
Kenneth Duda
|
| |
$160,000
|
|
|
Anshul Sadana
|
| |
$220,000
|
|
|
Marc Taxay
|
| |
$150,000
|
|
2020 Proxy Statement
|
| |
|
| |
37
|
|
Named Executive Officer
|
| |
Shares
|
| |
Grant Date
Fair Value |
|
|
Jayshree Ullal
|
| |
10,000
|
| |
$1,075,639
|
|
|
Ita Brennan
|
| |
5,000
|
| |
$537,820
|
|
|
Anshul Sadana
|
| |
14,000
|
| |
$1,505,894
|
|
|
Kenneth Duda
|
| |
10,000
|
| |
$1,075,639
|
|
|
Marc Taxay
|
| |
5,000
|
| |
$537,820
|
|
|
Named Executive Officer
|
| |
Shares
|
| |
Grant Date
Fair Value |
|
|
Ita Brennan
|
| |
6,250
|
| |
$1,651,375
|
|
|
Anshul Sadana
|
| |
8,000
|
| |
$2,113,760
|
|
|
Kenneth Duda
|
| |
7,000
|
| |
$1,849,540
|
|
|
Marc Taxay
|
| |
6,250
|
| |
$1,651,375
|
|
38
|
| |
|
| |
2020 Proxy Statement
|
|
Named Executive Officer
|
| |
Shares
|
| |
Grant Date
Fair Value |
|
|
Anshul Sadana
|
| |
2,000 stock options
|
| |
$232,583
|
|
|
Anshul Sadana
|
| |
12,000 RSUs
|
| |
$3,170,640
|
|
|
Named Executive Officer
|
| |
Shares
|
| |
Intended Value
|
|
|
Jayshree Ullal
|
| |
27,000
|
| |
$5,500,000
|
|
2020 Proxy Statement
|
| |
|
| |
39
|
•
|
an act of dishonesty made by her in connection with her responsibilities as an employee;
|
•
|
her conviction of, or plea of nolo contendere to, a felony or any crime involving fraud, embezzlement or any other act of moral turpitude;
|
•
|
her gross misconduct;
|
•
|
her unauthorized use of disclosure of any proprietary information or trade secrets of ours or any other party to whom she owes a duty of non-disclosure as a result of her relationship with us;
|
•
|
her willful breach of any obligations under any written agreement or covenant with us; or
|
•
|
her continued failure to perform his or her duties after a demand from us setting the basis of our belief and failure to cure within 10 business days after receiving such notice.
|
•
|
a material diminution of her authority, duties or responsibilities (which includes a reduction in authority, duties or responsibilities in connection with our being acquired and made part of a larger entity);
|
•
|
a material reduction of her base salary (which excludes a reduction in her base salary of 15% or less in any one year) other than a reduction applied to management generally; or
|
•
|
a material change in the geographic location of her primary work facility or location (which excludes a relocation of less than 50 miles from her then-present location).
|
40
|
| |
|
| |
2020 Proxy Statement
|
2020 Proxy Statement
|
| |
|
| |
41
|
|
Name and
Principal Position |
| |
Year
|
| |
Salary
($) |
| |
Bonus
($) |
| |
Stock
Awards ($)(2) |
| |
Option
Awards ($)(2) |
| |
Non-Equity
Incentive Plan Compensation ($) |
| |
All Other
Compensation ($) |
| |
Total
($) |
|
|
Jayshree Ullal
Chief Executive Officer |
| |
2019
|
| |
300,000
|
| |
—
|
| |
—
|
| |
1,075,639
|
| |
—
|
| |
8,532(3)
|
| |
1,384,171
|
|
|
2018
|
| |
300,000
|
| |
—
|
| |
5,903,000
|
| |
988,542
|
| |
350,000
|
| |
8,532
|
| |
7,550,074
|
| |||
|
2017
|
| |
300,000
|
| |
—
|
| |
3,939,788
|
| |
3,278,228
|
| |
400,000
|
| |
5,763
|
| |
7,923,779
|
| |||
|
Ita Brennan
Chief Financial Officer |
| |
2019
|
| |
300,000
|
| |
—
|
| |
1,651,375
|
| |
537,820
|
| |
150,000
|
| |
8,532(3)
|
| |
2,647,727
|
|
|
2018
|
| |
300,000
|
| |
—
|
| |
2,331,255
|
| |
915,205
|
| |
300,000
|
| |
8,532
|
| |
3,854,992
|
| |||
|
2017
|
| |
300,000
|
| |
120,000
|
| |
1,490,040
|
| |
—
|
| |
250,000
|
| |
2,163
|
| |
2,162,203
|
| |||
|
Kenneth Duda
Chief Technology Officer |
| |
2019
|
| |
300,000
|
| |
5,800(1)
|
| |
1,849,540
|
| |
1,075,639
|
| |
160,000
|
| |
8,532(3)
|
| |
3,399,511
|
|
|
2018
|
| |
280,769
|
| |
—
|
| |
2,993,050
|
| |
1,345,381
|
| |
320,000
|
| |
8,502
|
| |
4,947,702
|
| |||
|
2017
|
| |
250,000
|
| |
120,000
|
| |
2,483,400
|
| |
—
|
| |
280,000
|
| |
7,860
|
| |
3,141,260
|
| |||
|
Anshul Sadana
Chief Operating Officer |
| |
2019
|
| |
300,000
|
| |
—
|
| |
5,284,400
|
| |
1,738,477
|
| |
220,000
|
| |
8,532(3)
|
| |
7,551,409
|
|
|
2018
|
| |
290,385
|
| |
—
|
| |
3,532,630
|
| |
1,464,327
|
| |
440,000
|
| |
8,517
|
| |
5,735,859
|
| |||
|
2017
|
| |
275,000
|
| |
150,000
|
| |
2,483,400
|
| |
—
|
| |
350,000
|
| |
5,323
|
| |
3,263,723
|
| |||
|
Marc Taxay
Senior Vice President, General Counsel |
| |
2019
|
| |
300,000
|
| |
|
| |
1,651,375
|
| |
537,820
|
| |
150,000
|
| |
8,532 (3)
|
| |
2,647,727
|
|
(1)
|
The amount reported for fiscal 2019 represents a patent bonus award and a spot bonus award paid by the Company to Mr. Duda.
|
(2)
|
The amounts reported represent the aggregate grant-date fair value of the restricted stock units or stock options awarded to the Named Executive Officer, calculated in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 718 (“ASC Topic 718”). The assumptions used in calculating the grant-date fair value of the stock options reported in this column are set forth in our audited consolidated financial statements included in our Annual Report on Form 10-K, as filed with the SEC on February 14, 2020.
|
(3)
|
The amounts reported for fiscal 2019 include matching contributions from the Company for the contributions made to the 401(k) plan by the Named Executive Officer and a life insurance premium paid on the Named Executive Officer’s behalf.
|
42
|
| |
|
| |
2020 Proxy Statement
|
|
|
| |
|
| |
Option Awards
|
| |
Stock Awards
|
| ||||||||||||
|
Name
|
| |
Grant
Date |
| |
Number of
Securities Underlying Unexercised Options (#) Exercisable |
| |
Number of
Securities Underlying Unexercised Options (#) Unexercisable |
| |
Option
Exercise Price ($) |
| |
Option
Expiration Date |
| |
Number of
Shares or Units of Stock That Have Not Vested (#)(1) |
| |
Market
Value of Shares or Units of Stock That Have Not Vested ($)(2) |
|
|
Jayshree Ullal
|
| |
1/13/2014(3)
|
| |
11,000
|
| |
—
|
| |
22.49
|
| |
1/12/2024
|
| |
—
|
| |
—
|
|
|
2/12/2016(4)
|
| |
15,000
|
| |
40,000
|
| |
56.24
|
| |
2/11/2026
|
| |
—
|
| |
—
|
| |||
|
2/6/2017(5)
|
| |
13,750
|
| |
35,750
|
| |
95.51
|
| |
2/5/2027
|
| |
—
|
| |
—
|
| |||
|
2/6/2017(6)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
16,500
|
| |
3,356,100
|
| |||
|
3/9/2018(7)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
16,250
|
| |
3,305,250
|
| |||
|
4/13/2018(8)
|
| |
—
|
| |
8,000
|
| |
244.20
|
| |
4/12/2028
|
| |
—
|
| |
—
|
| |||
|
2/8/2019(9)
|
| |
—
|
| |
10,000
|
| |
226.34
|
| |
2/7/2029
|
| |
—
|
| |
—
|
| |||
|
Ita Brennan
|
| |
6/16/2015(10)
|
| |
12,917
|
| |
2,083
|
| |
84.97
|
| |
6/15/2025
|
| |
—
|
| |
—
|
|
|
6/16/2015(11)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
7,500
|
| |
1,525,500
|
| |||
|
9/11/2015(12)
|
| |
6,000
|
| |
4,000
|
| |
64.46
|
| |
9/10/2025
|
| |
—
|
| |
—
|
| |||
|
2/12/2016(13)
|
| |
11,000
|
| |
9,000
|
| |
56.24
|
| |
2/11/2026
|
| |
—
|
| |
—
|
| |||
|
2/12/2016(14)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
1,500
|
| |
305,100
|
| |||
|
3/10/2017(15)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
7,200
|
| |
1,464,480
|
| |||
|
3/9/2018(16)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
4,062
|
| |
826,211
|
| |||
|
4/13/2018(17)
|
| |
—
|
| |
5,000
|
| |
244.20
|
| |
4/12/2028
|
| |
—
|
| |
—
|
| |||
|
11/9/2018(18)
|
| |
—
|
| |
2,500
|
| |
244.43
|
| |
11/8/2028
|
| |
—
|
| |
—
|
| |||
|
11/9/2018(19)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
3,500
|
| |
711,900
|
| |||
|
2/8/2019(20)
|
| |
—
|
| |
5,000
|
| |
226.34
|
| |
2/7/2029
|
| |
—
|
| |
—
|
| |||
|
5/10/2019(21)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
6,250
|
| |
1,271,250
|
| |||
|
Kenneth Duda
|
| |
10/4/2011(22)
|
| |
100,000
|
| |
—
|
| |
3.33
|
| |
10/2/2021
|
| |
—
|
| |
—
|
|
|
12/27/2012(23)
|
| |
20,000
|
| |
—
|
| |
4.18
|
| |
12/26/2022
|
| |
—
|
| |
—
|
| |||
|
3/11/2013(24)
|
| |
100,000
|
| |
—
|
| |
7.76
|
| |
3/10/2023
|
| |
—
|
| |
—
|
| |||
|
1/13/2014(25)
|
| |
20,000
|
| |
—
|
| |
22.49
|
| |
1/12/2024
|
| |
—
|
| |
—
|
| |||
|
2/11/2014(26)
|
| |
100,000
|
| |
—
|
| |
30.67
|
| |
2/10/2024
|
| |
—
|
| |
—
|
| |||
|
12/16/2014(27)
|
| |
30,000
|
| |
20,000
|
| |
68.34
|
| |
12/15/2024
|
| |
—
|
| |
—
|
| |||
|
9/11/2015(28)
|
| |
12,000
|
| |
8,000
|
| |
64.46
|
| |
9/10/2025
|
| |
—
|
| |
—
|
| |||
|
2/12/2016(29)
|
| |
13,750
|
| |
11,250
|
| |
56.24
|
| |
2/11/2026
|
| |
—
|
| |
—
|
| |||
|
2/12/2016(30)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
2,500
|
| |
508,500
|
| |||
|
3/10/2017(31)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
12,000
|
| |
2,440,800
|
| |||
|
3/9/2018(32)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
4,875
|
| |
991,575
|
| |||
|
4/13/2018(33)
|
| |
—
|
| |
8,000
|
| |
244.20
|
| |
4/12/2028
|
| |
—
|
| |
—
|
| |||
|
11/9/2018(34)
|
| |
—
|
| |
3,000
|
| |
244.43
|
| |
11/8/2028
|
| |
—
|
| |
—
|
| |||
|
11/9/2018(35)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
5,000
|
| |
1,017,000
|
| |||
|
2/8/2019(36)
|
| |
—
|
| |
10,000
|
| |
226.34
|
| |
2/7/2029
|
| |
—
|
| |
—
|
| |||
|
5/10/2019(37)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
7,000
|
| |
1,423,800
|
|
2020 Proxy Statement
|
| |
|
| |
43
|
|
|
| |
|
| |
Option Awards
|
| |
Stock Awards
|
| ||||||||||||
|
Name
|
| |
Grant
Date |
| |
Number of
Securities Underlying Unexercised Options (#) Exercisable |
| |
Number of
Securities Underlying Unexercised Options (#) Unexercisable |
| |
Option
Exercise Price ($) |
| |
Option
Expiration Date |
| |
Number of
Shares or Units of Stock That Have Not Vested (#)(1) |
| |
Market
Value of Shares or Units of Stock That Have Not Vested ($)(2) |
|
|
Anshul Sadana
|
| |
4/19/2013(38)
|
| |
2,396
|
| |
—
|
| |
7.76
|
| |
4/18/2023
|
| |
—
|
| |
—
|
|
|
1/13/2014(39)
|
| |
11,600
|
| |
—
|
| |
22.49
|
| |
1/12/2024
|
| |
—
|
| |
—
|
| |||
|
2/11/2014(40)
|
| |
70,000
|
| |
—
|
| |
30.67
|
| |
2/10/2024
|
| |
—
|
| |
—
|
| |||
|
12/16/2014(41)
|
| |
4,167
|
| |
20,000
|
| |
68.34
|
| |
12/15/2024
|
| |
—
|
| |
—
|
| |||
|
9/11/2015(42)
|
| |
1,667
|
| |
8,000
|
| |
64.46
|
| |
9/10/2025
|
| |
—
|
| |
—
|
| |||
|
2/12/2016(43)
|
| |
2,083
|
| |
11,250
|
| |
56.24
|
| |
2/11/2026
|
| |
—
|
| |
—
|
| |||
|
2/12/2016(44)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
2,500
|
| |
508,500
|
| |||
|
10/14/2016(45)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
6,000
|
| |
1,220,400
|
| |||
|
3/10/2017(46)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
12,000
|
| |
2,440,800
|
| |||
|
3/9/2018(47)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
5,687
|
| |
1,156,736
|
| |||
|
4/13/2018(48)
|
| |
—
|
| |
8,000
|
| |
244.20
|
| |
4/12/2028
|
| |
—
|
| |
—
|
| |||
|
11/9/2018(49)
|
| |
—
|
| |
4,000
|
| |
244.43
|
| |
11/8/2028
|
| |
—
|
| |
—
|
| |||
|
11/9/2018(50)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
6,000
|
| |
1,220,400
|
| |||
|
2/8/2019(51)
|
| |
—
|
| |
14,000
|
| |
226.34
|
| |
2/7/2029
|
| |
—
|
| |
—
|
| |||
|
5/10/2019(52)
|
| |
292
|
| |
1,708
|
| |
264.22
|
| |
5/9/2029
|
| |
—
|
| |
—
|
| |||
|
5/10/2019(53)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
10,200
|
| |
2,074,680
|
| |||
|
5/10/2019(54)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
8,000
|
| |
1,627,200
|
| |||
|
Marc Taxay
|
| |
1/13/2014(55)
|
| |
833
|
| |
—
|
| |
22.49
|
| |
1/12/2024
|
| |
—
|
| |
—
|
|
|
2/11/2014(56)
|
| |
833
|
| |
—
|
| |
30.67
|
| |
2/10/2024
|
| |
—
|
| |
—
|
| |||
|
12/16/2014(57)
|
| |
4,000
|
| |
68.34
|
| |
12/15/2024
|
| |
—
|
| |
—
|
| |
|
| |||
|
9/11/2015(58)
|
| |
—
|
| |
4,000
|
| |
64.46
|
| |
9/10/2025
|
| |
—
|
| |
—
|
| |||
|
2/12/2016(59)
|
| |
—
|
| |
4,500
|
| |
56.24
|
| |
2/11/2026
|
| |
—
|
| |
—
|
| |||
|
2/12/2016(60)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
1,000
|
| |
203,400
|
| |||
|
4/8/2016(61)
|
| |
250
|
| |
3,750
|
| |
65.01
|
| |
4/07/2026
|
| |
—
|
| |
—
|
| |||
|
4/8/2016(62)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
3,000
|
| |
610,200
|
| |||
|
3/10/2017(63)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
7,200
|
| |
1,464,480
|
| |||
|
3/9/2018(64)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
4,062
|
| |
826,211
|
| |||
|
4/13/2018(65)
|
| |
—
|
| |
5,000
|
| |
244.20
|
| |
04/12/2028
|
| |
—
|
| |
—
|
| |||
|
11/9/2018(66)
|
| |
—
|
| |
2,500
|
| |
244.43
|
| |
11/08/2028
|
| |
—
|
| |
—
|
| |||
|
11/9/2018(67)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
3,500
|
| |
711,900
|
| |||
|
2/8/2019(68)
|
| |
—
|
| |
5,000
|
| |
226.34
|
| |
02/07/2029
|
| |
—
|
| |
—
|
| |||
|
5/10/2019(69)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
6,250
|
| |
1,271,250
|
|
(1)
|
Represents (i) restricted stock awards and (ii) shares of restricted stock issued upon the early exercise of stock options, in each case that remained unvested as of December 31, 2019.
|
(2)
|
This column represents the market value of the shares of our common stock underlying the restricted stock awards or restricted stock as of December 31, 2019, based on the closing price of our common stock, as reported on the New York Stock Exchange, of $203.40 per share on December 31, 2019, the last trading day of our fiscal 2019.
|
(3)
|
The option is subject to an early exercise provision and is immediately exercisable. This option vests, subject to Ms. Ullal’s continued role as a service provider to us, with respect to 1/5th of the shares granted one year from December 1, 2016 with the remaining shares vesting in equal amounts over the next 48 months. At the end of 2019, 8,000 shares of the amount exercisable were unvested.
|
(4)
|
This option vests, subject to Ms. Ullal’s continued role as a service provider to us, with respect to 1/60th of the shares each month from January 1, 2017.
|
(5)
|
This option vests, subject to Ms. Ullal’s continued role as a service provider to us, with respect to 1/5th of the shares granted one year from February 6, 2017 with the remaining shares vesting in equal amounts over the next 48 months.
|
(6)
|
This award of restricted stock units vests, subject to Ms. Ullal’s continued role as a service provider to us, with respect to 1/20th of the shares each quarter from February 20, 2017.
|
(7)
|
This award of restricted stock units vests, subject to Ms. Ullal’s continued role as a service provider to us, with respect to 1/16th of the shares each quarter from May 20, 2019.
|
44
|
| |
|
| |
2020 Proxy Statement
|
(8)
|
This option vests, subject to Ms. Ullal’s continued role as a service provider to us, with respect to 1/48th of the shares each month from June 1, 2020.
|
(9)
|
This option vests, subject to Ms. Ullal’s continued role as a service provider to us, with respect to 1/48th of the shares each month from December 1, 2020.
|
(10)
|
This option vests, subject to Ms. Brennan’s continued role as a service provider to us, with respect to 1/5th of the shares one year from May 18, 2015 with the remaining shares vesting in equal amounts over the next 48 months.
|
(11)
|
This award of restricted stock units vests, subject to Ms. Brennan’s continued role as a service provider to us, with respect to 1/5th of the shares one year from May 18, 2015 with the remaining shares vesting in equal amounts over the next 16 quarters.
|
(12)
|
This option vests, subject to Ms. Brennan’s continued role as a service provider to us, with respect to 1/5th of the shares one year from December 1, 2016 with the remaining shares vesting in equal amounts over the next 48 months.
|
(13)
|
This option vests, subject to Ms. Brennan’s continued role as a service provider to us, with respect to 1/60th of the shares each month from April 1, 2017.
|
(14)
|
This award of restricted stock units vests, subject to Ms. Brennan’s continued role as a service provider to us, with respect to 1/16th of the shares each quarter from February 20, 2017.
|
(15)
|
This award of restricted stock units vests, subject to Ms. Brennan’s continued role as a service provider to us, with respect to 1/20th of the shares each quarter from February 20, 2018.
|
(16)
|
This award of restricted stock units vests, subject to Ms. Brennan’s continued role as a service provider to us, with respect to 1/16th of the shares each quarter from May 20, 2019.
|
(17)
|
This option vests, subject to Ms. Brennan’s continued role as a service provider to us, with respect to 1/48th of the shares each month from June 1, 2020.
|
(18)
|
This option vests, subject to Ms. Brennan’s continued role as a service provider to us, with respect to 1/48th of the shares each month from December 1, 2020.
|
(19)
|
This award of restricted stock units vests, subject to Ms. Brennan’s continued role as a service provider to us, with respect to 1/16th of the shares each quarter from November 20, 2020.
|
(20)
|
This option vests, subject to Ms. Brennan’s continued role as a service provider to us, with respect to 1/48th of the shares each month from December 1, 2020.
|
(21)
|
This award of restricted stock units vests, subject to Ms. Brennan’s continued role as a service provider to us, with respect to 1/16th of the shares each quarter from November 20, 2020.
|
(22)
|
This option vests 1/4th of shares granted on September 30, 2013 with the remaining shares vesting in equal amounts over the next 36 months.
|
(23)
|
This option vests 1/4th of shares granted on December 1, 2014 with the remaining shares vesting in equal amounts over the next 36 months.
|
(24)
|
The option is subject to an early exercise provision and was immediately exercisable at the time of grant. This option vests, subject to Mr. Duda’s continued role as a service provider to us, with respect to 1/4th of the shares granted on December 1, 2016 with the remaining shares vesting in equal amounts over the next 36 months. At the end of 2019, none of the exercisable shares were unvested.
|
(25)
|
The option is subject to an early exercise provision and was immediately exercisable at the time of grant. This option vests, subject to Mr. Duda’s continued role as a service provider to us, with respect to 1/5th of the shares granted on December 1, 2017 with the remaining shares vesting in equal amounts over the next 48 months. At the end of 2019, 8,000 shares of the exercisable shares were unvested.
|
(26)
|
The option is subject to an early exercise provision and was immediately exercisable at the time of grant. This option vests, subject to Mr. Duda’s continued role as a service provider to us, with respect to 1/5th of shares granted on December 1, 2018 with the remaining shares vesting in equal amounts over the next 48 months. At the end of 2019, 60,000 shares of the exercisable shares were unvested.
|
(27)
|
This option vests, subject to Mr. Duda’s continued role as a service provider to us, with respect to 1/5th of shares granted on December 1, 2017 with the remaining shares vesting in equal amounts over the next 48 months.
|
(28)
|
This option vests, subject to Mr. Duda’s continued role as a service provider to us, with respect to 1/5th of shares granted on December 1, 2017 with the remaining shares vesting in equal amounts over the next 48 months.
|
(29)
|
This option vests, subject to Mr. Duda’s continued role as a service provider to us, with respect to 1/60th of shares granted on April 1, 2017, with the remaining shares vesting in equal amounts over the next 59 months.
|
(30)
|
This award of restricted stock units vests, subject to Mr. Duda’s continued role as a service provider to us, with respect to 1/16th of the shares granted on February 20, 2017 with the remaining shares vesting in equal amounts over the next 15 quarters.
|
(31)
|
This award of restricted stock units vests, subject to Mr. Duda’s continued role as a service provider to us, with respect to 1/20th of the shares granted on February 20, 2018 with the remaining shares vesting in equal amounts over the next 19 quarters.
|
(32)
|
This award of restricted stock units vests, subject to Mr. Duda’s continued role as a service provider to us, with respect to 1/16th of the shares granted on May 20, 2019 and will continue to vest at the same rate on each quarterly vest date thereafter.
|
(33)
|
This option vests, subject to Mr. Duda’s continued role as a service provider to us, with respect to 1/48th of the shares each month from June 1, 2020.
|
(34)
|
This option vests, subject to Mr. Duda’s continued role as a service provider to us, with respect to 1/48th of the shares each month from December 1, 2020.
|
(35)
|
This award of restricted stock units vests, subject to Mr. Duda’s continued role as a service provider to us, with respect to 1/16th of the restricted stock units awarded on November 20, 2020 and will continue to vest at the same rate on each quarterly vest date thereafter.
|
(36)
|
This option vests, subject to Mr. Duda’s continued role as a service provider to us, with respect to 1/48th of the shares each month from December 1, 2020.
|
(37)
|
This award of restricted stock units vests, subject to Mr. Duda’s continued role as a service provider to us, with respect to 1/16th of the restricted stock united awarded on November 20, 2020 and will continue to vest at the same rate on each quarterly vest date thereafter.
|
(38)
|
These shares remain subject to a repurchase right held by us at the original exercise price, in the event of the termination of Mr. Sadana’s employment with us. These shares vest with respect to 1/4th of the shares granted one year from December 1, 2015 with the remaining shares vesting in equal amounts over the next 36 months.
|
2020 Proxy Statement
|
| |
|
| |
45
|
(39)
|
The option is subject to an early exercise provision and was immediately exercisable at the time of grant. This option vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/5th of the shares granted one year from December 1, 2016 with the remaining shares vesting in equal amounts over the next 48 months. At the end of 2019, 9,600 shares of the exercisable shares were unvested.
|
(40)
|
The option is subject to an early exercise provision and is immediately exercisable. This option vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/5th of the shares granted one year from December 1, 2017 with the remaining shares vesting in equal amounts over the next 48 months. At the end of 2019, 60,000 shares of the amount exercisable were unvested.
|
(41)
|
This option vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/5th of the shares granted one year from December 1, 2016 with the remaining shares vesting in equal amounts over the next 48 months.
|
(42)
|
This option vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/5th of the shares granted one year from December 1, 2016 with the remaining shares vesting in equal amounts over the next 48 months.
|
(43)
|
This option vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/60th of the shares granted one year from April 1, 2016 with the remaining shares vesting in equal amount over the next 59 months.
|
(44)
|
This award of restricted stock units vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/16th of the shares each quarter from November 20, 2017.
|
(45)
|
This award of restricted stock units vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/20th of the shares each quarter from February 20, 2017.
|
(46)
|
This award of restricted stock units vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/20th of the shares each quarter from February 20, 2018.
|
(47)
|
This award of restricted stock units vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/16th of the shares each quarter from May 20, 2019.
|
(48)
|
This option vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/48th of the shares each month from June 1, 2020.
|
(49)
|
This option vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/48th of the shares each month from December 1, 2020.
|
(50)
|
This award of restricted stock units vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/16th of the shares each quarter from November 20, 2020.
|
(51)
|
This option vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/48th of the shares each month from December 1, 2020.
|
(52)
|
This option vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/48th of the shares each month from June 10, 2019.
|
(53)
|
This award of restricted stock units vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/20th of the shares each quarter from May 20, 2019.
|
(54)
|
This award of restricted stock units vests, subject to Mr. Sadana’s continued role as a service provider to us, with respect to 1/16th of the shares each quarter from November 20, 2020.
|
(55)
|
The option is subject to an early exercise provision and was immediately exercisable at the time of grant. This option vests, subject to Mr. Taxay’s continued role as a service provider to us, with respect to 1/5th of the shares each month from May 1, 2016 with the remaining shares vesting in equal amounts over the next 48 months. At the end of 2019, 833 of the exercisable shares were unvested.
|
(56)
|
The option is subject to an early exercise provision and was immediately exercisable at the time of grant. This option vests, subject to Mr. Taxay’s continued role as a service provider to us, with respect to 1/5th of the shares each month from May 1, 2016 with the remaining shares vesting in equal amounts over the next 48 months. At the end of 2019, 833 of the exercisable shares were unvested.
|
(57)
|
This option vests, subject to Mr. Taxay’s continued role as a service provider to us, with respect to 1/5th of the shares each month from December 1, 2017 with the remaining shares vesting in equal amounts over the next 48 months.
|
(58)
|
This option vests, subject to Mr. Taxay’s continued role as a service provider to us, with respect to 1/5th of the shares each month from December 1, 2017 with the remaining shares vesting in equal amounts over the next 48 months.
|
(59)
|
This option vests, subject to Mr. Taxay’s continued role as a service provider to us, with respect to 1/60th of the shares each month from April 1, 2017 with the remaining shares vesting in equal amounts over the next 59 months.
|
(60)
|
This award of restricted stock units vests, subject to Mr. Taxay’s continued role as a service provider to us, with respect to 1/16th of the shares each quarter from February 20, 2017.
|
(61)
|
This option vests, subject to Mr. Taxay’s continued role as a service provider to us, with respect to 1/60th of the shares each month from April 28, 2016 with the remaining shares vesting in equal amounts over the next 59 months.
|
(62)
|
This award of restricted stock units vests, subject to Mr. Taxay’s continued role as a service provider to us, with respect to 1/20th of the shares each quarter from May 20, 2016.
|
(63)
|
This award of restricted stock units vests, subject to Mr. Taxay’s continued role as a service provider to us, with respect to 1/20th of the shares each quarter from February 20, 2018.
|
(64)
|
This award of restricted stock units vests, subject to Mr. Taxay’s continued role as a service provider to us, with respect to 1/16th of the shares each quarter from May 20, 2019.
|
(65)
|
This option vests, subject to Mr. Taxay’s continued role as a service provider to us, with respect to 1/48th of the shares each month from June 1, 2020.
|
(66)
|
This option vests, subject to Mr. Taxay’s continued role as a service provider to us, with respect to 1/48th of the shares each month from December 1, 2020.
|
(67)
|
This award of restricted stock units vests, subject to Mr. Taxay’s continued role as a service provider to us, with respect to 1/16th of the shares each quarter from November 20, 2020.
|
(68)
|
This option vests, subject to Mr. Taxay’s continued role as a service provider to us, with respect to 1/48th of the shares each month from December 1, 2020.
|
(69)
|
This award of restricted stock units vests, subject to Mr. Taxay’s continued role as a service provider to us, with respect to 1/16th of the shares each quarter from November 20, 2020.
|
46
|
| |
|
| |
2020 Proxy Statement
|
|
Named Executive Officer
|
| |
Grant Date
|
| |
Estimated
Future Payouts Under Non- Equity Incentive Plan Awards (Target) ($)(1) |
| |
All Other
Stock Awards: Number of Shares of Stock or Units (#)(2) |
| |
All Other
Option Awards: Number of Shares Underlying Options (#)(2) |
| |
Exercise
Price of Option Awards ($) |
| |
Grant
Date Fair Value of Stock and Option Awards ($)(3) |
|
|
Jayshree Ullal
|
| |
—
|
| |
300,000
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
|
| |
2/8/2019
|
| |
—
|
| |
—
|
| |
10,000
|
| |
226.34
|
| |
1,075,639
|
|
|
Ita Brennan
|
| |
—
|
| |
180,000
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
|
| |
2/8/2019
|
| |
—
|
| |
—
|
| |
5,000
|
| |
226.34
|
| |
537,820
|
|
|
|
| |
5/10/2019
|
| |
—
|
| |
6,250
|
| |
—
|
| |
—
|
| |
1,651,375
|
|
|
Kenneth Duda
|
| |
—
|
| |
180,000
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
|
| |
2/8/2019
|
| |
—
|
| |
—
|
| |
10,000
|
| |
226.34
|
| |
1,075,639
|
|
|
|
| |
5/10/2019
|
| |
—
|
| |
7,000
|
| |
—
|
| |
—
|
| |
1,849,540
|
|
|
Anshul Sadana
|
| |
—
|
| |
180,000
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
|
| |
2/8/2019
|
| |
—
|
| |
—
|
| |
14,000
|
| |
226.34
|
| |
1,505,895
|
|
|
|
| |
5/10/2019
|
| |
—
|
| |
—
|
| |
2,000
|
| |
264.22
|
| |
232,583
|
|
|
|
| |
5/10/2019
|
| |
—
|
| |
12,000
|
| |
—
|
| |
—
|
| |
3,170,640
|
|
|
|
| |
5/10/2019
|
| |
—
|
| |
8,000
|
| |
—
|
| |
—
|
| |
2,113,760
|
|
|
Marc Taxay
|
| |
—
|
| |
180,000
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
|
| |
2/8/2019
|
| |
—
|
| |
—
|
| |
5,000
|
| |
226.34
|
| |
537,820
|
|
|
|
| |
5/10/2019
|
| |
—
|
| |
6,250
|
| |
—
|
| |
—
|
| |
1,651,375
|
|
(1)
|
Each Named Executive Officer has the following target annual bonus under the 2019 Bonus Plan: (i) Ms. Ullal: $300,000; (ii) Ms. Brennan: $180,000; (iii) Mr. Duda: $180,000; (iv) Mr. Sadana: $180,000; (v) Mr. Taxay: $180,000.
|
(2)
|
The restricted stock unit and stock option awards were made under the 2014 Equity Incentive Plan.
|
(3)
|
The amounts reported in the Grant Date Fair Value of Stock and Option Awards column represent the grant date fair value of stock options and/or restricted stock awards granted in fiscal 2019, calculated in accordance with ASC Topic 718.
|
|
|
| |
Option Awards
|
| |
Stock Awards
|
| ||||||
|
Named Executive Officer
|
| |
Number of
Shares Acquired on Exercise (#) |
| |
Value Realized
on Exercise ($)(1) |
| |
Number of
Shares Acquired on Vesting (#) |
| |
Value Realized
on Vesting ($)(2) |
|
|
Jayshree Ullal
|
| |
22,250
|
| |
5,144,446
|
| |
12,000
|
| |
2,738,556
|
|
|
Ita Brennan
|
| |
—
|
| |
—
|
| |
19,838
|
| |
4,594,844
|
|
|
Kenneth Duda
|
| |
—
|
| |
—
|
| |
7,625
|
| |
1,756,280
|
|
|
Anshul Sadana
|
| |
57,087
|
| |
14,376,001
|
| |
12,613
|
| |
2,889,109
|
|
|
Marc Taxay
|
| |
13,000
|
| |
2,522,712
|
| |
9,738
|
| |
2,326,201
|
|
(1)
|
Based on the market price of our common stock on the date of exercise less the option exercise price paid for those shares, multiplied by the number of shares for which the option was exercised.
|
(2)
|
Based on the market price of our common stock on the vesting date or last trading date, multiplied by the number of shares vested.
|
2020 Proxy Statement
|
| |
|
| |
47
|
|
|
| |
|
| |
Value of Accelerated Equity
Awards ($)(1) |
| |
|
| |||
|
Named Executive Officer
|
| |
Salary
Continuation ($) |
| |
Restricted
Stock Units |
| |
Options
|
| |
Total ($)
|
|
|
Ita Brennan
|
| |
300,000
|
| |
2,697,084
|
| |
1,113,210
|
| |
4,110,294
|
|
|
Marc Taxay
|
| |
300,000
|
| |
1,558,044
|
| |
1,552,072
|
| |
3,410,116
|
|
(1)
|
The amounts reported in the table reflect the aggregate market value of the unvested shares of our common stock underlying outstanding restricted stock unit awards and stock options that would become vested on a qualifying termination. For the unvested stock options, the aggregate market value is computed by multiplying (i) the number of shares of our common stock underlying unvested and outstanding stock options at December 31, 2019, that would become vested by (ii) the difference between $203.40 (the closing market price of our common stock on the New York Stock Exchange on December 31, 2019) and the exercise price of such option. For the restricted stock unit awards, the aggregate market value is computed by multiplying (i) the number of unvested shares of our common stock subject to outstanding restricted stock awards or outstanding restricted stock unit awards at December 31, 2019, that would become vested by (ii) $203.40 (the closing market price of our common stock on the New York Stock Exchange on December 31, 2019).
|
|
|
| |
|
| |
Value of Accelerated Equity
Awards ($)(1) |
| |
|
| |||
|
Named Executive Officer
|
| |
Salary
Continuation ($) |
| |
Restricted
Stock Units |
| |
Options
|
| |
Total ($)
|
|
|
Ita Brennan
|
| |
300,000
|
| |
3,967,520
|
| |
1,186,790
|
| |
5,454,310
|
|
|
Marc Taxay
|
| |
300,000
|
| |
2,828,480
|
| |
1,588,862
|
| |
4,417,343
|
|
(1)
|
The amounts reported in the table reflect the aggregate market value of the unvested shares of our common stock underlying outstanding restricted stock unit awards and stock options that would become vested on a qualifying termination. For the unvested stock options, the aggregate market value is computed by multiplying (i) the number of shares of our common stock underlying unvested and outstanding stock options at December 31, 2019, that would become vested by (ii) the difference between $203.40 (the closing market price of our common stock on the New York Stock Exchange on December 31, 2019) and the exercise price of such option. For the restricted stock unit awards, the aggregate market value is computed by multiplying (i) the number of unvested shares of our common stock subject to outstanding restricted stock unit awards at December 31, 2019, that would become vested by (ii) $203.40 (the closing market price of our common stock on the New York Stock Exchange on December 31, 2019).
|
48
|
| |
|
| |
2020 Proxy Statement
|
•
|
Our annual bonus plan considers a multiple of performance factors and allows our compensation committee to review performance on a holistic basis minimizing risk related to our short-term variable compensation; and
|
•
|
Our equity awards include multi-year vesting schedules requiring a long-term employee commitment.
|
2020 Proxy Statement
|
| |
|
| |
49
|
•
|
the median of the annual total compensation of all employees of our Company (other than our Chief Executive Officer), was $151,647; and
|
•
|
the annual total compensation of our Chief Executive Officer, as reported in the Fiscal 2019 Summary Compensation Table presented elsewhere in this proxy statement, was $1,384,171.
|
•
|
We selected October 31, 2019 as the date upon which we would identify the median employee.
|
•
|
To identify the “median employee” from our employee population we used payroll and equity plan records.
|
•
|
The compensation measure included the following: annual base salary for salaried employees (or hourly rate multiplied by estimated work schedule for hourly employees), actual incentive compensation paid in 2019 as of the determination date, and grant date fair value of equity awards granted in 2019.
|
•
|
We did not apply any de minimis exclusions to remove certain employees in non-U.S. jurisdictions allowed by Item 402(u).
|
•
|
Amounts paid in foreign currency were converted into United States dollars using 2019 average exchange rates.
|
50
|
| |
|
| |
2020 Proxy Statement
|
•
|
The calculation was performed for all employees, excluding Ms. Ullal, whether employed on a full-time, part-time, or seasonal basis. Because there was an even number of employees, two individuals were identified as the median. As one of these two received extraordinary equity grants during 2019, we selected the other employee, whose compensation we consider to be consistent with that of other employees near the median.
|
•
|
With respect to the annual total compensation of the “median employee,” we identified and calculated the elements of such employee’s compensation for 2019 in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K, resulting in annual total compensation of $151,647.
|
•
|
With respect to the annual total compensation for our Chief Executive Officer, we used the amount reported in the “Total” column of our Summary Compensation Table for Fiscal Year 2019.
|
2020 Proxy Statement
|
| |
|
| |
51
|
|
Plan Category
|
| |
(a) Number of
Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights |
| |
(b) Weighted Average
Exercise Price of Outstanding Options, Warrants and Rights |
| |
(c) Number of
Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflecting in Column (a)) |
|
|
Equity compensation plans approved by stockholders
|
| |
5,633,907(1)
|
| |
42.50(2)
|
| |
18,338,496(3)
|
|
|
Equity compensation plans not approved by stockholders
|
| |
—
|
| |
—
|
| |
—
|
|
|
Total
|
| |
5,633,907
|
| |
42.50
|
| |
18,338,496
|
|
(1)
|
Includes 4,563,595 shares underlying stock options and 1,070,312 shares of restricted stock units.
|
(2)
|
The weighted average exercise price is calculated based solely on outstanding stock options.
|
(3)
|
Includes the following plans: Arista Networks, Inc. 2014 Equity Incentive Plan (“2014 Plan”) and Arista Networks, Inc. 2014 Employee Stock Purchase Plan (“ESPP”). Our 2014 Plan provides that on the first day of each fiscal year beginning in 2016 and ending in (and including) 2024, the number of shares available for issuance thereunder is automatically increased by a number equal to the least of (i) 12,500,000 shares, (ii) 3% of the outstanding shares of our common stock as of the last day of our immediately preceding year, or (iii) such other amount as our board of directors may determine. On January 1, 2020, the number of shares available for issuance under our 2014 Plan increased by 2,291,660 shares pursuant to these provisions. Our ESPP provides that on the first day of each fiscal year beginning in 2015 and ending in (and including) 2034, the number of shares available for issuance thereunder is automatically increased by a number equal to the least of (i) 2,500,000 shares, (ii) 1% of the outstanding shares of our common stock on the first day of such year, or (iii) such other amount as our board of directors may determine. On January 1, 2020, the number of shares available for issuance under our ESPP increased by 763,886 shares pursuant to these provisions. These increases are not reflected in the table above.
|
52
|
| |
|
| |
2020 Proxy Statement
|
•
|
each of our directors and nominees for director;
|
•
|
each of our Named Executive Officers;
|
•
|
all of our current directors and executive officers as a group; and
|
•
|
each person or group, who beneficially owned more than 5% of our common stock.
|
|
Name of Beneficial Owner
|
| |
Number of
Shares Beneficially Owned |
| |
Percentage of
Shares Beneficially Owned |
|
|
5% Stockholders:
|
| |
|
| |
|
|
|
The Bechtolsheim Family Trust(1)
|
| |
12,575,230
|
| |
16.62%
|
|
|
The Vanguard Group(2)
|
| |
5,986,495
|
| |
7.91%
|
|
|
The 2010 David R. Cheriton Irrevocable Trust dtd July 28,2010(3)
|
| |
4,217,061
|
| |
5.57%
|
|
|
BlackRock, Inc.(4)
|
| |
3,962,098
|
| |
5.24%
|
|
|
Named Executive Officers and Directors:
|
| |
|
| |
|
|
|
Jayshree Ullal(5)
|
| |
3,718,246
|
| |
4.91%
|
|
|
Ita Brennan(6)
|
| |
50,908
|
| |
*
|
|
|
Kenneth Duda(7)
|
| |
1,232,544
|
| |
1.62%
|
|
|
Anshul Sadana(8)
|
| |
112,957
|
| |
*
|
|
|
Marc Taxay(9)
|
| |
8,467
|
| |
*
|
|
|
Charles Giancarlo(10)
|
| |
84,212
|
| |
*
|
|
|
Ann Mather(11)
|
| |
14,321
|
| |
*
|
|
|
Daniel Scheinman(12)
|
| |
26,712
|
| |
*
|
|
|
Mark Templeton(13)
|
| |
5,240
|
| |
*
|
|
|
Nikos Theodosopoulos(14)
|
| |
25,610
|
| |
*
|
|
|
All executive officers and directors as a group (12 persons)(15)
|
| |
18,228,551
|
| |
23.77%
|
|
*
|
Represents beneficial ownership of less than one percent (1%) of the outstanding shares of our common stock.
|
2020 Proxy Statement
|
| |
|
| |
53
|
(1)
|
Includes 12,575,230 shares held by the Bechtolsheim Family Trust for which trust Mr. Bechtolsheim serves as trustee. Mr. Bechtolsheim may be deemed to exercise sole voting and investment power over such shares held by the trust.
|
(2)
|
Based solely upon a Schedule 13G/A filed with the SEC on February 12, 2020 by The Vanguard Group (“Vanguard”) reporting beneficial ownership as of December 31, 2019. Vanguard reported sole voting power with respect to 85,556 shares and shared voting power with respect to 15,281 shares. Vanguard reported sole dispositive power with respect to 5,890,917 shares and shared dispositive power with respect to 95,578 shares. The address for Vanguard is 100 Vanguard Boulevard, Malvern, Pennsylvania 19355.
|
(3)
|
Based upon a Schedule 13G/A filed with the SEC on January 24, 2020. Includes 4,217,061 shares held in an irrevocable, directed trust for the benefit of the minor children of Mr. Cheriton. The trustee of the trust is the South Dakota Trust Company, LLC and Mr. Cheriton ultimately has the ability to replace the trustee. The investment management functions of the trust are handled by the investment committee of the trust. The address for the trustee of the trust is c/o South Dakota Trust Company LLC, 201 South Phillips Ave., Suite 200, Sioux Falls, South Dakota 57104.
|
(4)
|
Based solely upon a Schedule 13G filed with the SEC on February 7, 2020 by BlackRock, Inc. (“BlackRock”) reporting beneficial ownership as of December 31, 2019. BlackRock reported sole voting power with respect to 3,453,845 shares and sole dispositive power with respect to 3,962,098 shares. The address for BlackRock is 55 East 52nd Street, New York, New York 10055.
|
(5)
|
Includes 2,252,564 shares held by Jayshree Ullal and Vijay Ullal as Trustees of the 2000 Ullal Trust dated February 15, 2000. Mr. and Ms. Ullal may be deemed to be the beneficial owner of the shares and to have shared voting and investment control over such shares. Includes 1,388,000 shares held in trusts for Ms. Ullal’s family members for which trusts Ms. Ullal serves as trustee. Ms. Ullal may be deemed to exercise sole voting and investment control over shares held in each of the trusts. Includes 17,577 shares held directly by Ms. Ullal. Includes 60,105 shares issuable within 60 days of April 2, 2020 upon vesting of restricted stock units or the exercise of outstanding exercisable options held by Ms. Ullal, of which 6,000 shares may be repurchased by us, if exercised, at the original exercise price.
|
(6)
|
Includes 40,142 shares issuable within 60 days of April 2, 2020 upon vesting of restricted stock units or the exercise of outstanding exercisable options held by Ms. Brennan.
|
(7)
|
Includes 330,071 shares held by Kenneth Duda and Jennifer Duda as Trustees of the Kenneth Duda and Jennifer Duda Family Trust dated September 24, 2004. Mr. and Ms. Duda may be deemed to be the beneficial owners of the shares and to have shared voting and investment control over such shares. Includes 213,944 shares held in grantor retained annuity trusts of which Mr. Duda is Trustee; 213,944 shares held in grantor retained annuity trusts of which Mr. Duda’s spouse is Trustee; 59,514 shares held in trusts for Mr. Duda’s children for which trusts Mr. Duda serves as Trustee; 2,360 shares held in a 501(c) foundation for which Mr. Duda and his spouse serve as co-trustees and 5,294 shares held directly by Mr. Duda. Includes 407,417 shares issuable within 60 days of April 2, 2020 upon vesting of restricted stock units or the exercise of outstanding exercisable options held by Mr. Duda, of which 56,000 shares may be repurchased by us, if exercised, at the original exercise price.
|
(8)
|
Includes 105,493 shares issuable within 60 days of April 2, 2020 upon vesting of restricted stock units or the exercise of outstanding exercisable options held by Mr. Sadana, of which 57,200 shares may be repurchased by us, if exercised, at the original exercise price.
|
(9)
|
Includes 3,700 shares issuable within 60 days of April 2, 2020 upon vesting of restricted stock units or the exercise of outstanding exercisable options held by Mr. Taxay.
|
(10)
|
Includes 73,334 shares held of record by Mr. Giancarlo as trustee of the Giancarlo Family Trust UAD 11/02/98. Mr. Giancarlo may be deemed to be the beneficial owner of the shares and to have voting and investment power over such shares. The 73,334 shares includes 2,500 shares which may be repurchased by us at the original exercise price, as of a date within 60 days of April 2, 2020, in the event of the termination of Mr. Giancarlo’s services to us. The repurchase right lapses as to approximately 417 shares per month. Includes 10,658 shares held directly by Mr. Giancarlo. Also includes 220 shares issuable within 60 days of April 2, 2020 upon vesting of restricted stock units held by Mr. Giancarlo.
|
(11)
|
Includes 14,064 shares issuable within 60 days of April 2, 2020 upon vesting of restricted stock units or the exercise of outstanding exercisable options held by Ms. Mather, of which 7,500 shares may be repurchased by us, if exercised, at the original exercise price.
|
(12)
|
Includes 18,887 shares issuable within 60 days of April 2, 2020 upon vesting of restricted stock units or the exercise of outstanding exercisable options held by Mr. Scheinman.
|
(13)
|
Includes 437 shares issuable within 60 days of April 2, 2020 upon vesting of restricted stock units held by Mr. Templeton.
|
(14)
|
Includes 21,687 shares issuable within 60 days of April 2, 2020 upon vesting of restricted stock units or the exercise of outstanding exercisable options held by Mr. Theodosopoulos.
|
(15)
|
Includes 1,031,573 shares issuable within 60 days of April 2, 2020 upon vesting of options and restricted stock units or the early exercise of outstanding options, 268,533 of which shares are unvested and may be repurchased by us, if exercised, at the original exercise price in the event of the termination of employment or other services to us.
|
54
|
| |
|
| |
2020 Proxy Statement
|
•
|
the amounts involved exceeded or will exceed $120,000; and
|
•
|
any of our directors, nominees for director, executive officers or holders of more than 5% of our outstanding capital stock, or any immediate family member of, or person sharing the household with, any of these individuals or entities, had or will have a direct or indirect material interest.
|
2020 Proxy Statement
|
| |
|
| |
55
|
56
|
| |
|
| |
2020 Proxy Statement
|
2020 Proxy Statement
|
| |
|
| |
57
|