May 24, 2022

 

Dear Fellow Shareholders:

 

2021 was a historic year for CyberArk characterized by transformation, outperformance and acceleration. The result: a record year with strong underlying growth of the business. Excellence in execution and robust secular tailwinds drove a step-function increase in demand for our solutions. Importantly, we made great progress in our transition to a subscription model, which resonated both with our sales organization and our customers. We consistently outperformed throughout 2021, delivering against our strategic imperatives to drive growth, execute our subscription transition, deliver innovation and scale our operations. In fact, every quarter was significantly better than the previous, with business momentum accelerating as we moved through the year.

 

 

 

 

 

 

 

 

 

 

 Identity Security Strategy

 

With digital transformation, cloud migration and the most severe threat landscape ever seen, identity has been at the forefront of CISO discussions. Increasing geopolitical tensions, like we are seeing with the war in Ukraine, have typically resulted in an increase in cyberwarfare. As the global leader in Identity Security, centered on Privileged Access Management (PAM), we are focused on helping protect organizations against identity oriented cyber attacks, and our solutions have never been more relevant than in the current environment. Today, every identity can become privileged under certain conditions, and we offer an end-to-end Identity Security platform that provides extensive security controls to reduce that risk, while driving operational efficiency with a frictionless user experience.

 

We can secure access for any identity – human or machine – to help organizations secure critical business assets, protect their distributed workforce and customers, and accelerate business in the cloud. In 2021, we continued to execute our strategy to deliver an Identity Security Platform that contextually authenticates each identity, dynamically authorizes the least amount of privilege required, secures credentials, and thoroughly audits the entire cycle. With solutions like Secure Web Sessions that can continuously monitor, re-authenticate and isolate sessions seamlessly to the end user, we are strongly positioned to deliver on our vision.

 

Subscription Transition 

 

Momentum continued to build throughout 2021, with our SaaS solutions leading the way as we executed our subscription transformation strategy. Before kicking off the subscription transition, we outlined a detailed strategy and established a dedicated team to implement the program. We promoted Matt Cohen, who has extensive experience implementing subscription transition programs, to Chief Operating Officer, to spearhead the execution of the program. We consistently outperformed our subscription transition targets of percentage of bookings from subscription and, in fact, we achieved our subscription transition bookings mix goal in just five quarters, in March 2022, well ahead of the eight to ten quarters we initially outlined when we formally kicked off our transition in February 2021. We are delivering faster time-to-value for our customers, driving increased velocity of our business as customers’ add on more products and more users faster under the new model, and creating tremendous value for our shareholders. In addition, we are focused on enhancing our Customer Success, support, and renewals teams to materialize the full potential of being a subscription company. We are working hard to ensure excellence in execution and in operating as a subscription company, aiming to impress our customers with superior customer support and amazing solutions, which will result in strong net retention rates.

 

We are now entering the second phase of our subscription transition program – operating as a recurring revenue company. We are laser focused on delighting our customers by delivering breakthrough innovation, superior customer service, as well as acting as a trusted advisor as we navigate the most challenging cyber threat landscape of our lifetime.

 

Environmental, Social & Governance (ESG) Program Highlights

 Throughout the period of transformation in 2021, we continued to build a more inclusive and sustainable company, including enhancing our ESG program. We strengthened our oversight of the ESG program through the creation of an internal ESG Committee – a cross functional team of key company employees and management. Additionally, the Board formalized ESG oversight by delegating to relevant committees’ the oversight of specific ESG-related areas that fall within their primary areas of responsibilities. The Board’s Nominating and Corporate Governance Committee continues to have primary oversight responsibility for the Company’s ESG matters, disclosure and strategy, entailing the coordination, as necessary, with other Board committees, the Company’s ESG Committee and its Executive Steering Committee. Early in 2022, we expanded the responsibilities of our Senior Vice President Investor Relations to include our ESG Program. We published our first Environmental, Social, and Governance (ESG) report in December 2021, highlighting the progress we made and identifying key program focus areas: cybersecurity, corporate governance, business ethics and compliance, Human Capital Management, Diversity, Equity & Inclusion, and environmental stewardship.

 

 Ongoing ESG initiatives include:

 

Cybersecurity

 

 

Corporate Governance, Business Ethics and Compliance

 

 

 

 

Human Capital Management

 

 

 

 

Diversity Equity & Inclusion

 

 

 

Environmental Stewardship

 

 

 

 

As we look ahead, we intend to continue enhancing our ESG program to expand its impact in support of our constituents – employees, customers, partners, shareholders and communities. We have also placed an emphasis on building the foundation for tracking additional ESG-related Key Performance Indicators (KPIs) and metrics for our reporting and defined programs for 2022.

 

Conclusion

Over the last year, digital transformation, cloud migration and attacker innovation accelerated, driving durable growth in the demand environment. Identity Security is at the center of these macro trends, and our solutions have never been more relevant. We are incredibly proud of the resiliency and amazing execution of the entire CyberArk team, putting us in a great position to continue capitalizing on our tremendous opportunity in Identity Security in 2022. We are confident that our identity security strategy and subscription transition program will create long-term value for our employees, customers, partners, shareholders and communities.

On behalf of the Board, we invite you to attend our 2022 Annual General Meeting of Shareholders to be held at 4:00 p.m. (Israel time) on June 28, 2022, at our corporate headquarters at 9 Hapsagot St., Park Ofer B, Petach-Tikva, Israel. 

 

Thank you for your ongoing support of CyberArk.

 

 

CYBERARK SOFTWARE LTD.

9 Hapsagot St., Park Ofer B, POB 3143, Petach-Tikva, 4951040, Israel

+972-3-918-0000

May 24, 2022

 

Dear CyberArk Software Ltd. Shareholders: 

 

We cordially invite you to attend the 2022 Annual General Meeting of Shareholders (the “Meeting”) of CyberArk Software Ltd. (the “Company”) to be held at 4:00 p.m. (Israel time) on June 28, 2022, at the Company’s offices at 9 Hapsagot St., Park Ofer B, Petach-Tikva, Israel.

 

The Meeting is being called for the following purposes:

 

(ii)

To re-elect François Auque for a term of approximately two years as a Class I director of the Company, until the Company’s annual general meeting of shareholders to be held in 2024 and until his successor is duly elected and qualified;

(2)	To approve a compensation policy for the Company’s executives and directors, in accordance with the requirements of the Israeli Companies Law, 5759-1999 (the “Companies Law”);

(3)	To authorize, in accordance with the requirements of the Companies Law, the Company’s Chairman of the Board and Chief Executive Officer, Ehud (Udi) Mokady, to continue serving as the Chairman of the Board and the Company’s Chief Executive Officer, for a period of two years; and

(4)

To approve the re-appointment of Kost Forer Gabbay & Kasierer, registered public accounting firm, a member firm of Ernst & Young Global, as the Company’s independent registered public accounting firm for the year ending December 31, 2022 and until the Company’s 2023 annual general meeting of shareholders, and to authorize the Board of Directors of the Company (the “Board”) to fix such accounting firm’s annual compensation.

Members of the Company’s management will be available at the Meeting to discuss the consolidated financial statements of the Company for the fiscal year ended December 31, 2021. 

 

The Board unanimously recommends that you vote in favor of each of the foregoing proposals, which are more fully described in the accompanying proxy statement.

 

We know of no other matters to be submitted at the Meeting other than as specified herein. If any other business is properly brought before the Meeting, the persons named as proxies may vote in respect thereof in accordance with the recommendation of the Board or, absent such recommendation, using their best judgment.

 

Shareholders of record at the close of business on May 20, 2022, are entitled to vote at the Meeting.

 

Detailed proxy voting instructions are provided both in the proxy statement and on the enclosed proxy card, including for voting by telephone or the Internet. It is important that your shares be represented and voted at the Meeting. Accordingly, after reading the accompanying proxy statement, please mark, date, sign and mail the enclosed proxy card as promptly as possible in the enclosed stamped envelope or follow the instructions for voting by telephone or the Internet. If voting by mail, the proxy must be received by the Company’s transfer agent or at the Company’s registered office at 9 Hapsagot St., Park Ofer B, Petach-Tikva, Israel, not later than 11:59 p.m. (EDT) on June 27, 2022 to be validly included in the tally of ordinary shares voted at the Meeting. If you are a shareholder who holds shares in “street name” (i.e., through a bank, broker or other nominee), an earlier deadline may apply to receipt of your proxy card. An electronic copy of the enclosed proxy materials will also be available for viewing at http://investors.cyberark.com. The full text of the proposed resolutions, together with the form of proxy card for the Meeting, may also be viewed prior to the Meeting at the registered office of the Company from Sunday to Thursday (excluding holidays), 10:00 a.m. to 5:00 p.m. (Israel time). The Company’s telephone number at its registered office is +972-3-918-0000.

 

 

 

 

 

CYBERARK SOFTWARE LTD.

 

9 Hapsagot St., Park Ofer B, POB 3143, Petach-Tikva, 4951040, Israel

 

+972-3-918-0000

__________________________

 

PROXY STATEMENT

__________________________

 

2022 ANNUAL GENERAL MEETING OF SHAREHOLDERS

 

           This proxy statement (the “Proxy Statement”) is being furnished in connection with the solicitation of proxies on behalf of the Board of Directors (the “Board”) of CyberArk Software Ltd. (to which we refer as “we,” “us,” “CyberArk” or the “Company”) to be voted at the 2022 Annual General Meeting of Shareholders (the “Meeting”) and at any postponement or adjournment thereof. The Meeting will be held at 4:00 p.m. (Israel time) on June 28, 2022, at our offices at 9 Hapsagot St., Park Ofer B, Petach-Tikva, Israel.

 

 This Proxy Statement and the enclosed proxy card are being made available on or about May 24, 2022, to holders of the Company’s ordinary shares, nominal (par) value NIS 0.01 per share (“ordinary shares”), as of the close of business on May 20, 2022, the record date for the Meeting (the “Record Date”). You are entitled to vote at the Meeting if you hold ordinary shares as of the close of business on the Record Date.

 

See “How You Can Vote” below for information on how you can vote your shares at the Meeting. Our Board urges you to vote your shares so that they will be counted at the Meeting or at any postponements or adjournments of the Meeting.

 

We are not aware of any other matters that will come before the Meeting. If any other matters are presented properly at the Meeting, the persons designated as proxies intend to vote upon such matters in accordance with the recommendation of the Board or, absent such recommendation, using their best judgment.

 

 Quorum

 

 On the Record Date, we had 40,716,329 ordinary shares issued and outstanding. Each ordinary share outstanding as of the close of business on the Record Date is entitled to one vote on each of the proposals to be presented at the Meeting. Under our articles of association (the “Articles”), the Meeting will be properly convened if at least two shareholders attend the Meeting in person or sign and return proxies, provided that they hold shares representing at least 25% of the voting power of our Company. If a quorum is not present within half an hour from the time scheduled for the Meeting, the Meeting will be adjourned for one week (to the same day of the week, time and place), or to a day, time and place determined by the Chairman of the Meeting (which may be earlier or later than said time). At such adjourned meeting the presence of any shareholder in person or by proxy (regardless of the voting power represented by his, her or its shares) will constitute a quorum. 

 

Abstentions and “broker non-votes” (if any) are counted as present for purposes of determining a quorum. 

 

Vote Required for Approval of Each of the Proposals 

 

The affirmative vote of the holders of a majority of the voting power represented at the Meeting in person or by proxy and voting thereon is necessary for the approval of each of the proposals to be presented at the Meeting. In addition, the approval of Proposals 2 and 3 requires that either (i) such majority includes at least a majority of the votes cast by present and voting shareholders who are not “controlling shareholders” (as defined below) and who do not have a “personal interest” (as defined below) in the matter; or (ii) that the votes cast against such proposal by the shareholders who are not “controlling shareholders” and who do not have a “personal interest” do not exceed two percent (2%) of the aggregate voting power of the Company (the “Special Majority”). Except for the purpose of determining a quorum, abstentions from voting and “broker non-votes” (if any) are not treated as votes cast and are not counted in determining the outcome of any of these proposals.

 

Pursuant to the Companies Law, in order for your vote to be counted for purposes of the Special Majority, you must indicate on your proxy or inform the Company at the Meeting and prior to voting thereon, that (i) you are not a controlling shareholder of the Company, and (ii) you do not have a “personal interest” in the approval of Proposal 2 or 3. (any person or entity that do not meet the qualifications in both (i) and (ii) above shall be referred to hereinafter as an “Interested Party”).

 

Under the Companies Law, the term “personal interest” is defined as shareholder’s personal interest in an action or a transaction of a company (i) including the personal interest of the shareholder’s spouse, siblings, parents, grandparents, descendants, spouse’s descendants, siblings or parents or the spouse of any of such persons, and the personal interest of any entity in which the shareholder or one of the aforementioned relatives of the shareholder serves as a director or chief executive officer, owns 5% or more of such entity’s outstanding shares or voting rights or has the right to appoint one or more directors or the chief executive officer, and (ii) excluding a personal interest arising solely from holding the Company’s ordinary shares. Under the Companies Law, in the case of a person voting by proxy, “personal interest” includes the personal interest of either the proxy holder or the shareholder granting the proxy, whether or not the proxy holder has discretion over how to vote.

 

Under the Companies Law, a “controlling shareholder” is any shareholder that has the ability to direct our activities (other than by means of being a director or other office holder of the Company). A person is presumed to be a controlling shareholder if it holds or controls, by itself or together with others, 50% or more of any one of the “means of control” of the Company. “Means of control” is defined under Israeli law as any one of the following: (i) the right to vote at a general meeting of the Company, or (ii) the right to appoint directors of the Company or its chief executive officer.

 

In order for your vote to be counted for purposes of the Special Majority, you will be requested to indicate that you are not an Interested Party with respect to Proposal 2 or 3 by marking “YES” under Item 2A and 3A in the enclosed proxy card, voting instruction form or in your electronic or telephonic submission. In the alternative, if you believe that you are an Interested Party, and your vote should not be counted for the purposes of the Special Majority, you should mark “No” accordingly. If you do not mark any box in Item 2A and 3A, your vote will not be counted on the proposal.

 

As of the date of this Proxy Statement, we are not aware of any controlling shareholders as defined above, and therefore, we believe that, other than our directors, officers and their relatives, none of our shareholders should have a personal interest in Proposal 2 or 3. Thus, we believe any other shareholders should indicate they are not an Interested Party with respect to Proposal 2 or 3 by marking “YES” under Item 2A and 3A in their proxy card, voting instruction form or in their electronic or telephonic submission. If you are unsure whether you are a controlling shareholder or have a personal interest in the proposal, please contact our proxy solicitor, Innisfree M&A Incorporated, toll-free at 1 (888) 750-5834 (from the U.S. or Canada) or at +1 (412) 232-3651 (from other locations), or, if you hold your shares in “street name,” you may also contact the representative managing your account, who would then contact us on your behalf. We reserve the right to determine whether to exclude votes by a shareholder that is clearly known to us as having personal interest, or to include the votes in the opposite circumstances (known not to have personal interest).

 

How You Can Vote 

 

You can vote either in person at the Meeting or by authorizing another person as your proxy, whether or not you attend the Meeting. You may vote in any of the manners below:

 

We currently intend to hold the Annual Meeting in person, and depending on certain circumstances, may hold the Meeting virtually at the above date and time instead. If you wish to attend the Meeting in person and are unable to do so, please contact us at proxies@cyberark.com or our proxy solicitor (see “Assistance with Voting” below). In the event that we determine that a change to a virtual meeting format is advisable or required, an announcement of such change will be published in a Form 6-K filed with the Securities and Exchange Commission.

 

Shareholders of Record 

 

If you are a shareholder of record, that is, your shares are registered directly in your name with our transfer agent, American Stock Transfer & Trust Company, LLC, these proxy materials are being sent directly to you by our transfer agent. As the shareholder of record, you have the right to provide your voting proxy directly to the Corporate Secretary of our Company or to vote in person at the Meeting. If you do not wish to attend the Meeting and wish to vote your ordinary shares, you should submit a proxy in one of the above-mentioned manners. If you have lost or misplaced the proxy card mailed to you, you may request another by calling our proxy solicitor, Innisfree M&A Incorporated, toll-free at (888) 750-5834 (from the U.S. or Canada) or at +1 (412) 232-3651 (from other locations).

 

We will not be able to count a proxy card unless we receive it at our principal executive offices at 9 Hapsagot St., Park Ofer B, POB 3143, Petach-Tikva, 4951040, Israel, or our registrar and transfer agent receives it in the enclosed envelope no later than 11:59 p.m. (EDT) on June 27, 2022.

 

Please follow the instructions on the proxy card. If you provide specific instructions (by marking a box) with regard to the proposals, your shares will be voted as you instruct. If you sign and return your proxy card without giving specific instructions with respect to a particular proposal, your shares will be voted by the persons named as proxies in accordance with the recommendation of the Board. The persons named as proxies in the enclosed proxy card will furthermore vote in accordance with the recommendation of the Board or, absent such recommendation, using their best judgment on any other matters that may properly come before the Meeting. 

 

In the enclosed proxy card, voting instruction form or in your electronic or telephonic submission you will be requested to indicate whether you are an Interested Party with respect to Proposal 2 or 3. In order to provide for proper counting of shareholder votes, if you have not confirmed that you are not an Interested Party with respect to Proposal 2 or 3 by marking “YES” under Item 2A and 3A in the proxy card or voting instruction form or in your electronic or telephonic submission, your vote will not be counted for purposes of the Special Majority.

 

Shareholders Holding in “Street Name” 

 

If your ordinary shares are held in a brokerage account or through a bank, trustee or other nominee, you are considered to be the beneficial owner of shares held in “street name.” Proxy materials are being furnished to you together with a voting instruction form by the broker, bank, trustee or other nominee or an agent hired by the broker, trustee or nominee. Please follow the instructions on that form to direct your broker, bank, trustee or other nominee how to vote your shares. Many nominees provide means to vote by telephone or by Internet. Alternatively, if you wish to attend the Meeting and vote in person, you must obtain a “legal proxy” from the broker, trustee or nominee that holds your shares, giving you the right to vote your shares at the Meeting. 

 

Under the rules of the Nasdaq Stock Market LLC (“Nasdaq”), brokers, trustees or other nominees that hold shares in “street name” for clients only have authority to vote on “routine” proposals where they have not received voting instructions from beneficial owners, and a “broker non-vote” occurs when brokers, trustees or other nominees are unable to vote on “non-routine” proposals. The only item on the Meeting agenda that we believe may be considered “routine” is Proposal 4 relating to the reappointment of the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2022; however, we expect that this will not be treated as a routine matter since our Proxy Statement is prepared in compliance with the Companies Law, rather than the rules applicable to domestic U.S. reporting companies. 

 

 Thus, if you, as a beneficial owner of the shares, do not provide specific instructions to your broker, trustee or other nominee on a specific proposal, your broker, trustee or other nominee will not be allowed to exercise its voting discretion with respect to that proposal. If your shares are held of record by a broker, trustee or other nominee, we urge you to give instructions to your broker, trustee or other nominee as to how your shares should be voted so that you thereby participate in the voting on these important matters. Additionally, we remind you when you provide instructions to your broker, trustee or other nominee, you will be requested to indicate whether you are an Interested Party with respect to Proposal 2 or 3. If you have not confirmed that you are not an Interested Party with respect to Proposal 2 or 3 by marking “YES” under Item 2A and 3A in the proxy card or your voting instructions form or in your electronic or telephonic submission, your vote will not be counted for purposes of the Special Majority for purposes of Proposal 2 and Proposal 3.

 

Who Can Vote

 

You are entitled to receive notice of, and vote at, the Meeting if you are a shareholder of record at the close of business on the Record Date, in person or through a broker, trustee or other nominee that is one of our shareholders of record at such time, or which appear in the participant listing of a securities depository on that date.

 

Revocation of a Proxy 

 

Shareholders of record may revoke the authority granted by their execution of proxies at any time before the effective exercise thereof by filing with us a written notice of revocation or duly executed proxy bearing a later date, or by voting in person at the Meeting. Shareholders who hold shares in “street name” should follow the directions of, or contact, the bank, broker or nominee if they desire to revoke or modify previously submitted voting instructions.

 

Any shareholder of the Company who intends to present a proposal at the Meeting must satisfy the requirements of the Companies Law and our Articles. Under the Companies Law, only shareholders who hold at least 1% of the Company’s outstanding voting rights are entitled to request that the Board include a proposal in a shareholders’ meeting, provided that such proposal is deemed appropriate by the Board for consideration by shareholders at such meeting. Such shareholders may present proposals for consideration at the Meeting by submitting their proposals in writing to our Chief Legal Officer at the following address: CyberArk Software Ltd., 9 Hapsagot St., POB 3143, Petach-Tikva, 4951040, Israel, or by facsimile to +972-3-9180028, Attn: Donna Rahav, Chief Legal Officer. For a shareholder proposal to be considered for inclusion in the Meeting, our Chief Legal Officer must receive the written proposal no later than May 31, 2022.

 

Solicitation of Proxies 

 

Proxies are being made available to shareholders on or about May 24, 2022. We have retained Innisfree M&A Incorporated to assist with the solicitation of proxies in connection with the Meeting. Innisfree M&A Incorporated will receive customary fees plus out-of-pocket expenses in connection with the performance of its services. Certain officers, directors, employees, and agents of the Company, none of whom will receive additional compensation therefor, may also solicit proxies by telephone, email or other personal contact. We will bear the cost for the solicitation of the proxies, including postage, printing and handling, and will reimburse the reasonable expenses of brokerage firms and others for forwarding material to beneficial owners of shares.

 

Voting Results

 

The final voting results will be tallied by the Company’s Chief Legal Officer based on the information provided by the Company’s transfer agent or otherwise, and the overall results of the Meeting will be published following the Meeting in a report of foreign private issuer on Form 6-K that will be furnished to the Securities and Exchange Commission (the “SEC”). 

 

Availability of Proxy Materials 

 

Copies of the proxy card and this Proxy Statement were furnished to the SEC under cover of a Form 6-K and are also available at the “Investor Relations” section of our website at http://investors.cyberark.com. The contents of that website are not a part of this Proxy Statement and are not incorporated by reference herein. 

 

Assistance with Voting

 

If you have questions about how to vote your shares, you may contact our proxy solicitor, Innisfree M&A Incorporated, toll-free at 1 (888) 750-5834 (from the U.S. or Canada) or at +1 (412) 232-3651 (from other locations).

 

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

In addition to historical facts, this Proxy Statement contains forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, Section 21E of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995.  These forward-looking statements express the current beliefs and expectations of CyberArk’s management. In some cases, forward-looking statements may be identified by terminology such as “believe,” “continue,” “intend,” “plan,” “expect,” “potential” or the negative of these terms or other similar expressions.  Such statements involve a number of known and unknown risks and uncertainties that could cause the Company’s future results, levels of activity, performance or achievements to differ materially from the results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Important factors that could cause or contribute to such differences include risks relating to: changes to the drivers of the Company’s growth and its ability to adapt its solutions to IT security market demands; the transition of the Company’s business to a subscription model that began in 2021 and its ability to complete its transition goals in the time frame expected; the Company’s sales cycles and multiple pricing and delivery models; unanticipated product vulnerabilities or cybersecurity breaches of the Company’s, or the Company’s customers’ or partners’ systems; an increase in competition within the Privileged Access Management and Identity Security markets; the Company’s ability to hire, train, retain and motivate qualified personnel; the Company’s ability to sell into existing and new customers and industry verticals; risks related to compliance with privacy and data protection laws and regulations; the Company’s history of incurring net losses and our ability to achieve profitability in the future; the duration and scope of the COVID-19 pandemic and its impact on global and regional economies and the resulting effect on the demand for the Company’s solutions and on its expected revenue growth rates and costs; the Company’s ability to find, complete, fully integrate or achieve the expected benefits of additional strategic acquisitions; reliance on third-party cloud providers for the Company’s operations and SaaS solutions; the Company’s ability to expand its sales and marketing efforts and expand its  channel partnerships across existing and new geographies; risks related to sales made to government entities; regulatory and geopolitical risks associated with global sales and operations (including the current conflict between Russia and Ukraine) and changes in regulatory requirements or fluctuations in currency exchange rates; the ability of the Company’s products to help customers achieve and maintain compliance with government regulations or industry standards; risks related to intellectual property claims or the Company’s ability to protect its proprietary technology and intellectual property rights; and other factors discussed under the heading “Risk Factors” in the Company’s most recent annual report on Form 20-F filed with the Securities and Exchange Commission. These forward-looking statements are made only as of the date hereof, and the Company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.

 

COMPENSATION OF CERTAIN EXECUTIVE OFFICERS AND DIRECTORS

 

           For information about the compensation, on an individual basis, of our five most highly compensated office holders during or with respect to the year ended December 31, 2021, as required by regulations promulgated under the Companies Law, see “Item 6.B. Compensation” of our annual report on Form 20-F for the year ended December 31, 2021, filed with the SEC on March 10, 2022, and available on the “Investor Relations” section of our website at http://investors.cyberark.com or through the SEC’s website at www.sec.gov.

 

CORPORATE GOVERNANCE

 

Overview

 

CyberArk is committed to effective corporate governance and independent oversight by our Board. Our programs and policies are founded on the guiding principle that the Board is accountable for representing the best interests of our shareholders. We accomplish that primarily through Board independence, diversity of experience and engagement with shareholders and other key constituents.

 

Shareholder Engagement

 

We believe that effective corporate governance includes regular, constructive conversations with our shareholders, and we value our shareholders’ continued feedback and opinions. We are committed to maintaining an active dialogue to understand the priorities and concerns of our shareholders. All feedback is reviewed and implemented as appropriate for the Company’s strategy, business growth and maturity stage. As part of our investor relations program, we engage with the vast majority of our institutional shareholders throughout the calendar year in our quarterly earnings calls, investor conferences and investor meetings. Since 2016, we have annually conducted substantive discussions with shareholders on executive compensation, corporate governance, corporate performance, strategy and more recently on our ESG program. In 2021, for example, we engaged with over 85 percent of our top 20 shareholders, which represented about 44 percent of our outstanding shares. Our engagement has played a critical role in enhancing our strategy and applicable policies. In November 2021, we introduced an off-cycle engagement program, which was led by our lead independent director (“Lead Director”) and the Chairperson of the Nominating and Corporate Governance Committee, primarily related to the continued service of the Company’s Chief Executive Officer (the “CEO”) as the Chairman of the Board, and our ESG strategy. We have implemented the feedback received during these discussions in our corporate and ESG strategy, as appropriate and as further reflected in our voluntary ESG report published in December 2021, and in Proposal 2 and Proposal 3 below. Such feedback included, among other topics, oversight of our ESG program, shareholding requirements for executives and the duration of the combined Chairman of the Board and CEO Role. Maintaining an active dialogue with our shareholders is consistent with our corporate values of open communication and accountability, and we intend to continue these efforts in the future.

 

Board Structure

 

Our Articles provide that we may have no fewer than four and no more than nine directors, as may be fixed from time to time by the Board. Our Board currently consists of eight directors. Independence is a key pillar of our corporate governance, and each of our seven current non-employee directors is independent under Nasdaq corporate governance rules, which require a majority of our directors to be independent. Our directors are divided into three classes with staggered three-year terms. Each class of directors consists, as nearly as possible, of one-third of the total number of directors constituting the entire Board. At each annual general meeting of our shareholders, the term of office of only one class of directors expires. The election or re-election of such class of directors is for a term of office that expires as of the date of the third annual general meeting following such election or re-election. Each director holds office until the annual general meeting of our shareholders in which their term expires, unless they are removed by a vote of 65% of the total voting power of our shareholders at a general meeting of our shareholders or upon the occurrence of certain events, in accordance with the Companies Law and our Articles. The Nominating and Corporate Governance Committee and the Board approved a board refreshment program, including committing to introduce a new Board member at least every five years, and rotated the committee membership to include our newest Board members, Mr. Auque and Ms. England, in our Audit and Strategy Committees, respectively.

 

 Board Composition and Qualifications

 

Our Board provides independent oversight of the Company and management. Our Board consists of diverse, experienced and qualified members. The Board skills matrix below represents the key skills that our Board identified as particularly valuable to the effective oversight of the Company and the execution of our strategy, as well as diversity characteristics of our directors (25 percent of whom are women). This matrix highlights the depth and breadth of skills of our Board members.

 

 

 

Avril England Franpois Auque Ron Gutter Kim Perd^kou X X X X in o UI £ £ “H £ T] k co 3x 3 3X X o X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X avid Schaeffer Amnon Shoshani qsojij. ipeo Ehud (Udi) Mokady X X X Independent PERSONAL o UI cn CO cn Gn m W Age £ £ Gender 00 > ro k k Tenure (in years)* Audit Committee COMMITTEES X Compensation Committee X o Nominating & Corporate Governance o Strategy Committee X X X X Leadership & Business Operations EXPERIENCES SKILLS X X Cybersecurity & IT X X X Technology X X Finance & Accounting X X X X Risk Management X X X X International Businesses X X X X Strategy Development X X X X Mergers & Acquisitions X x X X Legal & Corporate Governance X X X Human Capital Management X X Sustainability

  *As of the date of the Meeting          C = Chairperson          (F) = Financial Expert

 

Board Leadership and Lead Independent Director

 

Mr. Mokady, our founder, has been on the Board since inception and has served as our CEO, since 2005. Since June 2016, he has also served as Chairman of our Board following the approval of our shareholders, which was reaffirmed in July 2019. At the 2016 and 2019 annual general meetings, our shareholders determined that, for so long as the positions of the CEO and Chairman of the Board are combined, our Board will appoint a Lead Director to facilitate strong, independent Board leadership and effective independent oversight. Our Lead Director is selected by our non-executive Board members from among the independent directors of the Board who have served a minimum of one year as a director. Additionally, if at any meeting of the Board the Lead Director is not present, one of the following individuals, in the order listed, will act as Lead Director for the duration of such meeting: the Chairperson of the Audit Committee, the Chairperson of the Compensation Committee, or an independent member of the Board appointed by a majority of the independent members of the Board present. Mr. Gadi Tirosh currently serves as our Lead Director. For more information regarding the authorities and responsibilities of the Lead Director, please refer to Proposal 3 below.

 

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Important Notice Regarding the Availability of Proxy Materials for the Annual General Meeting:

The Notice and Proxy Statement, Annual Report and Form 20-F are available at www.proxyvote.com.

 

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