Block, Inc DEF 14A, filed Apr 28, 2023
Block, Inc. (XYZ)
About this DEF 14A
Block, Inc filed this DEF 14A on April 28, 2023.
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
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Filed by the Registrant ☒
Filed by a Party other than the Registrant ☐
Check the appropriate box:
☐ Preliminary Proxy Statement
☐ Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
☒ Definitive Proxy Statement
☐ Definitive Additional Materials
☐ Soliciting Material under § 240.14a-12
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
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☐ Fee paid previously with preliminary materials
☐ Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.
Table of Contents
Table of Contents
BLOCK, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held at 10:00 a.m. (U.S. Pacific Time) on Tuesday, June 13, 2023
Dear Stockholders of Block, Inc.:
We cordially invite you to attend the 2023 annual meeting of stockholders (the “Annual Meeting”) of Block, Inc., a Delaware corporation, which will be held virtually on Tuesday, June 13, 2023, at 10:00 a.m. (U.S. Pacific Time). You can attend the Annual Meeting by visiting www.virtualshareholdermeeting.com/SQ2023, where you will be able to listen to the meeting live, submit questions and vote your shares online during the meeting, just as you could at an in-person meeting.
We are holding the Annual Meeting for the following purposes, as more fully described in the accompanying proxy statement:
Our board of directors has fixed the close of business on April 20, 2023 (U.S. Eastern Time) as the record date for the Annual Meeting. Only stockholders of record at the close of business on April 20, 2023 (U.S. Eastern Time) are entitled to notice of, and to vote at, the Annual Meeting. A list of stockholders entitled to vote at the Annual Meeting will be available for examination by any stockholder for any purpose germane to the Annual Meeting for a period of ten days ending the date prior to the date of the Annual Meeting at 1955 Broadway, Suite 600, Oakland, CA 94612. Further information regarding voting rights, the matters to be voted upon and instructions to attend the Annual Meeting is presented in the accompanying proxy statement.
The Notice of Internet Availability of Proxy Materials containing instructions on how to access the proxy statement and our annual report is first being mailed on or about April 28, 2023 to all stockholders entitled to vote at the Annual Meeting. The accompanying proxy statement and our annual report can be accessed by visiting www.proxyvote.com. You will be asked to enter the 16-digit control number located on your Notice of Internet Availability of Proxy Materials, your proxy card or the instructions that accompanied your proxy materials to attend the Annual Meeting.
Holders of record of Chess Depositary Interests (“CDIs”) as of the close of business on April 20, 2023 (U.S. Eastern Time) may vote the shares of our Class A common stock underlying their CDIs through our CDI Depositary, CHESS Depositary Nominees Pty Ltd (“CDN”). Each CDI holder may instruct CDN to vote on behalf of such CDI holder at the Annual Meeting by either voting online at www.investorvote.com.au or contacting Computershare Australia using the details on the Notice of Access Letter to request a hard copy of the CDI voting form to be sent in the mail to their registered address. The CDI Notice of Access Letter is being mailed or emailed from Australia to CDI holders on or about April 28, 2023 (Australia time).
YOUR VOTE IS IMPORTANT. Whether or not you plan to attend the Annual Meeting, we urge you to submit your vote via the Internet, telephone or mail as soon as possible to ensure your shares are represented. For additional instructions on attending the Annual Meeting or voting your shares (or directing CDN to vote if you hold your shares in the form of CDIs), please refer to the section entitled “Questions and Answers About Our Proxy Materials and the Annual Meeting” in this proxy statement. Returning the proxy does not deprive you of your right to attend the Annual Meeting or to vote your shares at the Annual Meeting.
We appreciate your continued support of Block.
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By order of the Board of Directors, |
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Jack Dorsey |
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Block Head and Chairperson of the Board of Directors |
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Approximate Date of Mailing of Notice of Internet Availability of Proxy Materials: April 28, 2023 |
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TABLE OF CONTENTS |
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EXECUTIVE SUMMARY |
This summary highlights information contained elsewhere in this proxy statement. This summary does not contain all of the information you should consider, and you should read the entire proxy statement carefully before voting. Throughout this proxy statement, we refer to our 2023 annual meeting of stockholders (and any postponements, adjournments, or continuations thereof) as the "Annual Meeting."
Information about our 2023 Annual Meeting of Stockholders
Date and Time: Tuesday, June 13, 2023, at 10:00 a.m. (U.S. Pacific Time).
Location: The Annual Meeting will be a completely virtual meeting. You can attend the Annual Meeting by visiting www.virtualshareholdermeeting.com/SQ2023, where you will be able to listen to the meeting live, submit questions, and vote your shares online during the meeting.
Record Date: April 20, 2023 (U.S. Eastern Time).
Voting Matters
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Proposals |
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Board |
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Page Number for |
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1 |
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To elect Roelof Botha, Amy Brooks, Shawn Carter and James McKelvey to serve as our Class II directors until our 2026 annual meeting of stockholders and until their successors are duly elected and qualified. |
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FOR |
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17 |
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2 |
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To approve, on an advisory basis, the compensation of our named executive officers. |
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FOR |
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18 |
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3 |
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To ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for our fiscal year ending December 31, 2023. |
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FOR |
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19 |
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4 |
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Stockholder proposal submitted by one of our stockholders regarding diversity and inclusion disclosure, if properly presented at the Annual Meeting. |
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AGAINST |
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21 |
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We will also transact such other business as may properly come before the Annual Meeting or any adjournments or postponements thereof. As of the date of this proxy statement, we have not received notice of any such business.
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BLOCK 2023 Proxy Statement |
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Table of Contents
Corporate Governance Highlights
We are committed to having sound corporate governance principles that we believe promote long-term value and serve the best interest of all our stockholders, sellers, customers and other stakeholders. Some highlights of our corporate governance practices are listed below:
• Proactive approach to board of directors pipeline management • 8 out of 11 current directors are independent • 3 out of 11 current directors are women; 2 out of 11 identify as LGBTQ or are underrepresented minorities • 3 out of 5 current executive officers are women • Separate Lead Independent Director and Chairperson • Strong risk oversight by full board of directors and committees |
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• Annual board of directors, committee and individual director evaluations • Significant stock ownership requirements for directors and executive officers • Insider Trading Policy prohibits hedging and pledging transactions • All board committees are 100% independent • Each director attended at least 75% of board of directors and committee meetings held during the period for which they served |
Our 2023 Director Nominees
Each of our Class II director nominees currently serves on our board of directors and demonstrates a mix of experiences and perspectives.
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Name |
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Director |
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Experience |
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Independent |
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Board and Committee |
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Other Current |
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Roelof Botha |
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2011 |
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Senior Steward, Sequoia Capital |
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✔ |
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Lead Independent Director, Audit and Risk Committee, Compensation Committee |
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23andMe Holding Co., Unity Software, Inc., Natera, Inc., and MongoDB, Inc. |
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Amy Brooks |
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2019 |
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President of Team Marketing & Business Operations and Chief Innovation Officer, NBA |
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✔ |
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Nominating and Corporate Governance Committee |
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None |
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Shawn Carter |
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2021 |
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Founder, ROC Nation |
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X |
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None |
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None |
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James McKelvey |
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2009 |
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Co-Founder, Block |
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X |
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None |
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None |
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BLOCK 2023 Proxy Statement |
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Table of Contents
Executive Compensation Philosophy and Highlights
Our Compensation Philosophy
Block's purpose is economic empowerment. We build tools to help more people access the economy. Square helps sellers start, run and grow their businesses with its integrated ecosystem of commerce solutions, business software and banking services. With Cash App, our customers can easily send, spend or invest their money in stocks or bitcoin. Artists use TIDAL to help them succeed as entrepreneurs and connect more deeply with their fans. TBD is building an open developer platform to make it easier to access bitcoin and other blockchain technologies without having to go through an institution. Our customers inspire us in how they innovate, take risks and take ownership. We want our employees, like our customers, to act like owners. Our compensation approach reflects this philosophy.
To this end, our compensation programs are designed to attract, retain and grow the best teams while reflecting the core tenets of our culture:
Executive Compensation Highlights
• Block Head (our version of Chief Executive Officer) Compensation. At his request, Jack Dorsey receives no cash or equity compensation except for an annual salary of $2.75. • Annual "Say-on-Pay" Vote. We conduct an annual non-binding advisory vote on the compensation of our named executive officers. At our 2022 annual meeting of stockholders, more than 98% of the votes cast on the "say-on-pay" proposal were voted in favor of the named executive officers’ compensation. • Clawback Policy. Our executive officers are subject to a clawback policy, which permits our board of directors to require forfeiture or reimbursement of incentive compensation if an executive engages in certain misconduct. • Independent Compensation Consultant. Our compensation committee engages its own independent compensation |
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consultant to advise on executive and non-employee director compensation matters. • Alignment of Compensation with Company Success. A substantial percentage of our executive officers' compensation aligns with the long-term success of the company through grants of stock options and restricted stock-based awards. • Risk Oversight. Strong oversight by our compensation committee mitigates risk and exposures. • Stock Ownership Guidelines. Our stock ownership guidelines require significant stock ownership levels and are designed to align the long-term interests of our executives and non-employee directors with those of our stockholders. |
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BLOCK 2023 Proxy Statement |
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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE |
Block, Inc., a Delaware corporation (referred to herein as the “Company,” “Block,” “we,” “us” or “our”), is committed to having sound corporate governance principles. Our business affairs are managed under the direction of our board of directors, which is currently composed of 11 members. All of our directors, other than Messrs. Carter, Dorsey and McKelvey, are independent within the meaning of the listing standards of the New York Stock Exchange (“NYSE”). Our board of directors is divided into three staggered classes of directors. At each annual meeting of stockholders, a class of directors will be elected for a three-year term to succeed the class whose term is then expiring.
The following table sets forth the names, ages as of April 28, 2023 and certain other information for each of the members of our board of directors with terms expiring at the Annual Meeting, who are also nominees for election as a director at the Annual Meeting, and for each of the continuing members of our board of directors:
Name |
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Class |
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Age |
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Position |
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Director |
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Current |
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Expiration of Term |
Directors with Terms Expiring at the Annual Meeting/Nominees |
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Roelof Botha⁽¹⁾⁽²⁾ |
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II |
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49 |
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Lead Independent Director |
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2011 |
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2023 |
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2026 |
Amy Brooks⁽³⁾ |
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II |
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48 |
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Director |
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2019 |
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2023 |
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2026 |
Shawn Carter |
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II |
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53 |
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Director |
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2021 |
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2023 |
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2026 |
James McKelvey |
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II |
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57 |
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Director |
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2009 |
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2023 |
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2026 |
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Continuing Directors |
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Randy Garutti⁽³⁾ |
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III |
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48 |
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Director |
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2017 |
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2024 |
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— |
Mary Meeker⁽¹⁾ |
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III |
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63 |
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Director |
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2011 |
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2024 |
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— |
Sharon Rothstein⁽¹⁾ |
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III |
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65 |
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Director |
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2022 |
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2024 |
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— |
Lawrence Summers⁽²⁾ |
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III |
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68 |
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Director |
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2011 |
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2024 |
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— |
Darren Walker⁽²⁾⁽³⁾ |
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III |
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63 |
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Director |
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2020 |
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2024 |
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— |
Jack Dorsey |
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I |
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46 |
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Block Head and Chairperson |
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2009 |
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2025 |
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— |
Paul Deighton⁽¹⁾⁽²⁾ |
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I |
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67 |
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Director |
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2016 |
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2025 |
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— |
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BLOCK 2023 Proxy Statement |
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Table of Contents
Director Nominees
Roelof Botha has served as a member of our board of directors since January 2011 and as our Lead Independent Director since June 2022. Since January 2003, Mr. Botha has served in various positions at Sequoia Capital, a venture capital firm, including as a Senior Steward and as a Managing Member of Sequoia Capital Operations, LLC. From 2000 to 2003, Mr. Botha served in various positions at PayPal Holdings, Inc., including as Chief Financial Officer. Mr. Botha serves on the boards of directors of 23andMe Holding Co., Natera, Inc., MongoDB, Inc., Unity Software Inc., and a number of privately held companies. Mr. Botha previously served on the boards of directors of Bird Global, Inc., from June 2018 to December 2022, and Eventbrite, Inc., from October 2009 to June 2022. Mr. Botha holds a B.S. in Actuarial Science, Economics and Statistics from the University of Cape Town and an M.B.A. from the Stanford Graduate School of Business.
Mr. Botha was selected to serve on our board of directors because of his financial and managerial experience.
Amy Brooks has served as a member of our board of directors since October 2019. Since November 2017, Ms. Brooks has served as President, Team Marketing & Business Operations and Chief Innovation Officer at the National Basketball Association, after serving as Executive Vice President from May 2014 to November 2017 and Senior Vice President from January 2010 to May 2014. Ms. Brooks also serves on the boards of directors of the Positive Coaching Alliance, a non-profit organization, and a privately held company. Ms. Brooks holds a B.A. in Political Science and Communication from Stanford University and an M.B.A. from the Stanford Graduate School of Business.
Ms. Brooks was selected to serve on our board of directors because of her sales and marketing experience as well as her expertise in growing a global brand.
Shawn Carter has served as a member of our board of directors since May 2021. Known professionally as Jay-Z, Mr. Carter is a musician, songwriter, record executive, producer and entrepreneur. He has served as the co-founder and majority owner of Roc Nation LLC and founder of Marcy Media LLC, a full-service agency and entertainment company, since 2008 and co-founder and Manager of Marcy Venture Partners, L.P., a venture capital and private equity firm, since March 2019. Mr. Carter founded TIDAL, which is now majority owned by Block, in March 2015, and remains a shareholder and artist of the music streaming service. Since 2014, Mr. Carter has served as the co-founder, Manager and board member of Ace of Spades Holdings, LLC, a luxury champagne company, and serves on the boards of directors of a number of privately held companies. Since 2003, Mr. Carter has served as the founder of the Shawn Carter Scholarship Foundation, a charitable organization focused on education. He also serves on the board of directors of REFORM, a philanthropic organization advocating for criminal justice reform. Mr. Carter previously served as the Chief Visionary Officer of TPCO Holding Corp. (“TPCO Holding”) from November 2020 to 2023, and as the Chief Brand Strategist of CMG Partners, Inc., or Caliva, from July 2019 until its acquisition by TPCO Holding in November 2020.
Mr. Carter was selected to serve on our board of directors because of his entrepreneurial experience and expertise in the music industry, which is valuable for our TIDAL business.
James McKelvey is our co-founder and has served as a member of our board of directors since July 2009. Since March 2012, Mr. McKelvey has served in various positions at Mira Smart Conferencing, Inc., a digital conferencing company. Mr. McKelvey previously served on the boards of directors of MoneyonMobile, Inc. from May 2016 to August 2018 and Ajax I Holdings, Inc. from October 2020 to August 2021, and serves on the boards of directors of a number of privately held companies, as well as the Federal Reserve Bank of St. Louis. Mr. McKelvey holds a B.S. in Computer Science and a B.A. in Economics from Washington University in St. Louis.
Mr. McKelvey was selected to serve on our board of directors because of the perspective and experience he brings as one of our founders.
Continuing Directors
Randy Garutti has served as a member of our board of directors since July 2017. Since April 2012, Mr. Garutti has served as Chief Executive Officer and on the board of directors of Shake Shack, Inc. (“Shake Shack”). Prior to becoming Chief Executive Officer, Mr. Garutti served as Chief Operating Officer of Shake Shack since January 2010. Before Shake Shack, Mr. Garutti was the Director of Operations for Union Square Hospitality Group, LLC, overseeing the operations for all its restaurants. Additionally, Mr. Garutti
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serves on the board of directors of the Columbus Avenue Business Improvement District, a not-for-profit organization. He previously served on the board of directors of USHG Acquisition Corp. from February 2021 to December 2022. Mr. Garutti holds a B.S. in Hotel Administration from Cornell University's School of Hotel Administration.
Mr. Garutti was selected to serve on our board of directors because of his business expertise and leadership of a global brand.
Mary Meeker has served as a member of our board of directors since June 2011. Since January 2019, Ms. Meeker has served as a General Partner of Bond Capital. From December 2010 to December 2018, Ms. Meeker served as a General Partner of Kleiner Perkins Caufield & Byers. From 1991 to 2010, Ms. Meeker served as Managing Director and Research Analyst with Morgan Stanley. Ms. Meeker previously served on the boards of directors of LendingClub Corporation, from June 2012 to June 2019, and DocuSign, Inc., from July 2012 to June 2019, and currently serves on the boards of directors of Nextdoor Holdings, Inc. and a number of privately held companies. Ms. Meeker holds a B.A. in Psychology from DePauw University and an M.B.A. from Cornell University.
Ms. Meeker was selected to serve on our board of directors because of her extensive experience advising and analyzing technology companies.
Sharon Rothstein has served as a member of our board of directors since January 2022. Since October 2018, Ms. Rothstein has served as an Operating Partner at Stripes, LLC (“Stripes”), a growth equity firm. Prior to joining Stripes, Ms. Rothstein served as Executive Vice President, Global Chief Marketing Officer, and subsequently, as Executive Vice President, Global Chief Product Officer of Starbucks Corporation (“Starbucks”) from April 2013 to February 2018. Prior to joining Starbucks, Ms. Rothstein held senior marketing and brand management positions with Sephora, Godiva, Starwood Hotels and Resorts, Nabisco Biscuit Company and Procter & Gamble. Ms. Rothstein serves on the boards of directors of Yelp Inc., InterContinental Hotels Group PLC and a number of privately held companies. She previously served on the board of directors of Afterpay Limited (“Afterpay”) from June 2020 until its acquisition by Block in 2022. Ms. Rothstein holds a Bachelor of Commerce from the University of British Columbia and an M.B.A. from the University of California, Los Angeles.
Ms. Rothstein was appointed to our board of directors pursuant to the terms and conditions of Block’s acquisition of Afterpay. She was selected to serve on our board of directors because of her marketing expertise and global operations experience.
Dr. Lawrence Summers has served as a member of our board of directors since June 2011. Since January 2011, Dr. Summers has served as the Charles W. Eliot University Professor & President Emeritus of Harvard University and the Weil Director of the Mossaar-Rahmani Center for Business & Government at the Harvard Kennedy School. From January 2009 to December 2010, Dr. Summers served as Director of the National Economic Council for President Obama. Dr. Summers previously served as President of Harvard University, and he has also served in various other senior policy positions, including as Secretary of the Treasury and Vice President of Development Economics and Chief Economist of the World Bank. Dr. Summers previously served on the board of directors of LendingClub Corporation from December 2012 to June 2018, and currently serves as the Chairperson of the International Advisory Board at Santander Bank and on the boards of directors of Skillsoft Corp. and Doma Holdings, Inc., as well as several privately held companies. Dr. Summers holds a B.S. in Economics from Massachusetts Institute of Technology and a Ph.D. in Economics from Harvard University.
Dr. Summers was selected to serve on our board of directors because of his extensive policy experience and in-depth knowledge of macroeconomic trends.
Darren Walker has served as a member of our board of directors since June 2020. Since 2013, Mr. Walker has served as the President of the Ford Foundation, a philanthropic organization. From 2010 to 2013, he served as Vice President for Education, Creativity and Free Expression at the Ford Foundation. Prior to the Ford Foundation, Mr. Walker worked for the Rockefeller Foundation, a philanthropic organization, and served as a Vice President responsible for foundation initiatives from 2005 to 2010. Mr. Walker currently serves on the boards of directors of Ralph Lauren Corporation, PepsiCo, Inc. and several non-profit organizations, including the National Gallery of Art, Lincoln Center for the Performing Arts, Friends of the High Line, the Smithsonian National Museum of African American History & Culture and Carnegie Hall. Mr. Walker is also a member of the Council on Foreign Relations and the American Academy of Arts and Sciences. Mr. Walker holds B.A., B.S. and J.D. degrees from the University of Texas at Austin.
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Mr. Walker was selected to serve on our board of directors because of his philanthropic experience and work around social justice, which is aligned with Block's purpose of economic empowerment.
Jack Dorsey is our co-founder and has served as our principal executive officer and as a member of our board of directors since July 2009, having previously served as our Chief Executive Officer and President from July 2009 until his title changed to Block Head as of April 2022. Mr. Dorsey has served as Chairperson of our board of directors since October 2010. From May 2007 to October 2008, Mr. Dorsey served as President and Chief Executive Officer of Twitter, Inc. (“Twitter”). Mr. Dorsey returned to serve as Chief Executive Officer of Twitter from July 2015 until November 2021. He served as on the board of directors of Twitter from May 2007 to May 2022.
Mr. Dorsey was selected to serve on our board of directors because of the perspective and experience he provides as one of our founders and our Block Head, as well as his extensive experience with technology companies and innovation.
Paul Deighton has served as a member of our board of directors since May 2016. Mr. Deighton has served as the non-executive Chairperson of The Economist Group since July 2018 and of Heathrow Airport Holdings Limited, the owner of Heathrow Airport in the United Kingdom, since June 2016. From December 2012 to May 2015, Mr. Deighton served as Commercial Secretary to the Treasury and as a member of the House of Lords in the United Kingdom. Mr. Deighton previously served as the Chief Executive Officer of the London Organising Committee of the Olympic and Paralympic Games and held various roles at Goldman Sachs. Mr. Deighton serves as the non-executive Chairperson of Hakluyt Company Limited, an advisory firm. Mr. Deighton holds a B.A. in Economics from Trinity College, Cambridge University.
Mr. Deighton was selected to serve on our board of directors because of his financial and business expertise, as well as his international perspective and his government and regulatory experience.
Director Independence
Our Class A common stock is listed on the NYSE. Under NYSE listing standards, independent directors must comprise a majority of a listed company’s board of directors. In addition, NYSE listing standards require that, subject to specified exceptions, each member of a listed company’s audit, compensation and nominating and corporate governance committees be independent. Under NYSE listing standards, a director will only qualify as an “independent director” if, in the opinion of that listed company’s board of directors, that director does not have a material relationship with the company (either directly or as a partner, shareholder or officer of an organization that has a relationship with the company). As noted in the commentary to the listing standards, the concern is independence from management.
Audit and risk committee members must also satisfy the additional independence criteria set forth in Rule 10A-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and NYSE listing standards. Compensation committee members must also satisfy the additional independence criteria set forth in Rule 10C-1 under the Exchange Act and NYSE listing standards.
Our board of directors has undertaken a review of the independence of each of our directors. Based on information provided by each director concerning their background, employment and affiliations, our board of directors has determined that none of Mses. Brooks, Meeker and Rothstein; Messrs. Botha, Deighton, Garutti and Walker and Dr. Summers has a material relationship with the Company and that each of these current directors is “independent” as that term is defined under the applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) and NYSE listing standards. In making the determination of the independence of our directors, the board of directors considered relevant transactions between Block and entities associated with our directors or members of their immediate families, including transactions involving Block and payments made to or from companies and entities in the ordinary course of business where our directors or members of their immediate families serve as partners, directors or as a member of the executive management of the other party to the transaction, and determined that none of these relationships constitute material relationships that would impair the independence of our directors.
Board of Directors Leadership Structure and Role of Our Lead Independent Director
Our board of directors does not have a policy as to whether the roles of the Chairperson of our board of directors and our Block Head should be separate or combined. Our board of directors believes that it should have the flexibility to make this determination as circumstances require and in a manner that it believes is best to provide appropriate leadership for our company. Currently, Mr. Dorsey serves as both the Chairperson of our board of directors and our principal executive officer. As our co-founder and Block
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Head, Mr. Dorsey is best positioned to identify and drive strategic priorities, oversee product development, identify key areas of risk for the company, lead critical discussions and execute our business plans.
Our board of directors has adopted Corporate Governance Guidelines that provide that one of our independent directors should serve as our Lead Independent Director at any time when the Chairperson of our board of directors is not independent. Because Mr. Dorsey is our Chairperson and is not an “independent” director as defined in NYSE listing standards, our board of directors has appointed a Lead Independent Director. Mr. Botha, a director since 2011, has served as our Lead Independent Director since June 2022. As a seasoned director with extensive experience in the financial technology industry, Mr. Botha has played an essential role in advising our senior management in key strategic areas and has provided independent oversight in his roles as a member of both our audit and risk committee and our compensation committee, and our board of directors believes that he is a strong, independent and effective Lead Independent Director.
As our Lead Independent Director, Mr. Botha is responsible for, among other matters:
We believe that our leadership structure of Mr. Dorsey serving as both Chairperson of our board of directors and Block Head, with a separate Lead Independent Director, is appropriate because it provides a balance between Mr. Dorsey’s company-specific experience, leadership and insight and our independent directors’ experience, leadership, oversight and expertise from outside of our company. This structure also enables strong leadership, creates clear accountability and enhances our ability to communicate our strategy clearly and consistently to stockholders while ensuring robust, independent oversight by our board of directors and Lead Independent Director.
Board of Directors Meetings, Attendance and Committees
During our fiscal year ended December 31, 2022, our board of directors held four meetings (including regularly scheduled and special meetings), and each director attended at least 75% of the aggregate of (i) the total number of meetings of our board of directors held during the period for which such director has served as a director and (ii) the total number of meetings held by all committees of our board of directors on which such director has served during the periods that such director has served as a committee member.
Although we do not have a formal policy regarding attendance by members of our board of directors at our annual meeting of stockholders, we encourage, but do not require, our directors to attend. All of our directors who were serving as directors at the time attended our 2022 annual meeting of stockholders.
Our board of directors has established an audit and risk committee, a compensation committee and a nominating and corporate governance committee. The composition and responsibilities of each of the
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committees of our board of directors is described below. Members serve on these committees until their resignation or until otherwise determined by our board of directors.
In addition to the responsibilities described below, each of the audit and risk committee, compensation committee and nominating and corporate governance committee provide oversight over the relevant activities of Square Financial Services, Inc. (“Square Financial Services”).
Audit and Risk Committee
Our audit and risk committee currently consists of Messrs. Botha, Deighton and Walker and Dr. Summers, with Mr. Deighton serving as Chair.
Each of our current audit and risk committee members meets the requirements for independence for audit committee members under NYSE listing standards and SEC rules and regulations. Each member of our audit and risk committee also meets the financial literacy and sophistication requirements of NYSE listing standards. In addition, our board of directors has determined that each of Messrs. Botha and Deighton is an audit committee financial expert within the meaning of Item 407(d) of Regulation S-K under the Securities Act of 1933, as amended (“Regulation S-K”). Our audit and risk committee is, among other matters, responsible for the following:
Our audit and risk committee charter provides that, consistent with NYSE listing standards, no member of our audit and risk committee should simultaneously serve on the audit committees of more than two additional public companies unless our board of directors determines that such simultaneous service would not impair the ability of such member to effectively serve on our audit and risk committee and we disclose such determination. Our board of directors has considered Mr. Botha’s simultaneous service on the audit committees of three additional public companies and has determined that such simultaneous service does not impair his ability to effectively serve as a member of our audit and risk committee. We believe that Mr. Botha's financial and managerial experience continue to provide valuable insight.
Our audit and risk committee operates under a written charter that satisfies the applicable rules and regulations of the SEC and NYSE listing standards. A copy of the charter of our audit and risk committee is available on our investor relations website at https://investors.block.xyz. Information on or accessible through our website is not incorporated by reference in this proxy statement. During 2022, our audit and risk committee held nine meetings.
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Compensation Committee
Our compensation committee consists of Mses. Meeker and Rothstein and Messrs. Botha and Deighton, with Ms. Meeker serving as Chair. Each of our compensation committee members meets the requirements for independence for compensation committee members under NYSE listing standards and SEC rules and regulations, including Rule 10C-1 under the Exchange Act. Each of Mses. Meeker and Rothstein and Messrs. Botha and Deighton is also a “non-employee director,” as defined pursuant to Rule 16b-3 promulgated under the Exchange Act. Our compensation committee is, among other matters, responsible for the following:
Our compensation committee operates under a written charter that satisfies the applicable rules and regulations of the SEC and NYSE listing standards. A copy of the charter of our compensation committee is available on our investor relations website at https://investors.block.xyz. During 2022, our compensation committee held five meetings.
Our compensation committee may delegate its authority and duties to subcommittees or individuals as it deems appropriate and in accordance with applicable laws and regulations. Our compensation committee has delegated authority to our management equity committee, which during 2022 consisted of our Block Head and People Lead, to make equity grants within predetermined guidelines to employees and consultants who are not our Section 16 officers or members of our management equity committee. In addition, our compensation committee may establish, and has in the past established, a subcommittee comprised of Mses. Meeker and Rothstein and Mr. Deighton, which has the nonexclusive authority to grant equity and other awards under our compensation plans, including, if applicable, awards that comply with Section 16 of the Exchange Act, including Rule 16b-3 thereunder.
Nominating and Corporate Governance Committee
Our nominating and corporate governance committee currently consists of Ms. Brooks and Messrs. Garutti and Walker, with Mr. Garutti serving as Chair. Each of our nominating and corporate governance committee members meets the requirements for independence under NYSE listing standards and SEC rules and regulations. Our nominating and corporate governance committee is, among other matters, responsible for the following:
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Our nominating and corporate governance committee operates under a written charter that satisfies the applicable NYSE listing standards. A copy of the charter of our nominating and corporate governance committee is available on our investor relations website at https://investors.block.xyz. During 2022, our nominating and corporate governance committee held four meetings.
Compensation Committee Interlocks and Insider Participation
None of the current members of our compensation committee, or any member that served during the past fiscal year, is or has been an officer or employee of our company, or had any relationship requiring disclosure under Item 404 of Regulation S-K. None of our executive officers currently serves, or in the past fiscal year has served, as a member of the board of directors or compensation committee (or other board committee performing equivalent functions) of any entity that has one or more of its executive officers serving on our compensation committee. None of our executive officers currently serves, or in the past fiscal year has served, as a member of the compensation committee (or other board committee performing equivalent functions) of any entity that has one or more of its executive officers serving on our board of directors.
Considerations in Evaluating Director Nominees
Our nominating and corporate governance committee uses a variety of methods for identifying and evaluating director nominees, which may include reviewing candidates whom our stockholders have properly submitted for recommendation or retaining a third-party executive search firm to identify and review candidates. We maintain policies and procedures for director candidates, which require our nominating and corporate governance committee to evaluate director candidates in light of the current size and composition, organization and governance of our board of directors and the needs of our board of directors and its committees. There is no difference in the evaluation process of a director candidate recommended by a stockholder as compared to the evaluation process of a candidate identified by any other means. Some of the qualifications that our nominating and corporate governance committee considers include, without limitation:
After completing its review and evaluation of director candidates, our nominating and corporate governance committee recommends to our full board of directors the director nominees for selection. While
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factors relating to diversity were considered for our current directors, no single factor was determinative with respect to any of our current directors.
Stockholder Recommendations and Nominations to our Board of Directors
Our nominating and corporate governance committee will consider director candidates recommended by stockholders holding the lesser of: (i) $2,000 in market value or (ii) one percent (1%) on a fully diluted basis of the Company’s securities continuously for at least twelve (12) months prior to the date of the submission of the recommendation, so long as such recommendations comply with our amended and restated certificate of incorporation, our amended and restated bylaws and any applicable laws, rules and regulations, including those promulgated by the SEC. Our nominating and corporate governance committee will evaluate such recommendations in accordance with its charter, our amended and restated bylaws and our policies and procedures for director candidates, as well as the director nominee criteria described above that is applicable to all director candidates. This process is designed to ensure that our board of directors includes members with diverse backgrounds, skills and experience, including appropriate financial and other expertise relevant to our business. Eligible stockholders may recommend a candidate for nomination by submitting the recommendation in writing to our Corporate Secretary or legal department at Block, Inc., 1955 Broadway, Suite 600, Oakland, CA 94612. Such recommendation must include information about the candidate, a statement of support by the recommending stockholder, evidence of the recommending stockholder’s ownership of our capital stock and a signed letter from the candidate confirming willingness to serve on our board of directors. Our nominating and corporate governance committee has discretion to decide which individuals to recommend for nomination as directors.
Under our amended and restated bylaws, stockholders may also directly nominate persons for our board of directors. Any nomination must comply with the requirements set forth in our amended and restated bylaws and should be sent in writing to our Corporate Secretary at Block, Inc., 1955 Broadway, Suite 600, Oakland, CA 94612. To be timely for our 2024 annual meeting of stockholders, our Corporate Secretary must receive the nomination no earlier than the close of business on February 14, 2024 and no later than the close of business on March 15, 2024, or in the event that we hold our 2024 annual meeting of stockholders more than 30 days before or more than 60 days after the one-year anniversary of the Annual Meeting, no earlier than the close of business on the 120th day before our 2024 annual meeting of stockholders and no later than the close of business on the later of either (i) the 90th day prior to our 2024 annual meeting of stockholders or (ii) the 10th day following the day on which public announcement of the date of our 2024 annual meeting of stockholders is first made if such first public announcement is less than 100 days prior to the date of our 2024 annual meeting of stockholders. Any notice of director nomination submitted must include the additional information required by Rule 14a-19(b) under the Exchange Act.
Communications with Non-Management Members of Our Board of Directors
Interested parties wishing to communicate with our non-management members of our board of directors may do so by writing to the particular non-management member or members of our board of directors, and mailing the correspondence via registered or overnight mail to our Corporate Secretary at Block, Inc., 1955 Broadway, Suite 600, Oakland, CA 94612. Each communication should set forth (i) the name and address of the interested party (as it appears on our books, if applicable) and if the shares of our common stock are held by a nominee, the name and address of the beneficial owner of such shares, and (ii) the class and number of shares of our common stock that are owned of record by the record holder and beneficially by the beneficial owner.
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Our Corporate Secretary or legal department, in consultation with appropriate members of our board of directors as necessary, will review all incoming communications and, if appropriate, forward such communications to the appropriate non-management member or members of our board of directors, or if none is specified, to the Chairperson of our board of directors or the Lead Independent Director if the Chairperson of our board of directors is not independent.
Corporate Governance Guidelines and Code of Business Conduct and Ethics
Our board of directors has adopted Corporate Governance Guidelines that address items such as the qualifications and responsibilities of our directors and director candidates and the responsibilities of members of committees of our board of directors. In addition, our board of directors has adopted a Code of Business Conduct and Ethics that applies to all of our employees, officers and directors, including our Block Head, Chief Financial Officer and other executive and senior financial officers. The full texts of our Corporate Governance Guidelines and our Code of Business Conduct and Ethics are posted on our investor relations website at https://investors.block.xyz. We will post amendments to our Corporate Governance Guidelines and our Code of Business Conduct and Ethics and any waivers of our Code of Business Conduct and Ethics for directors and executive officers on the same website.
Risk Management
Our board of directors recognizes the oversight of risk management as one of its primary responsibilities and central to maintaining an effective, risk-aware and accountable organization. The oversight responsibility of our board of directors and its committees is supported by management reporting processes that are designed to provide visibility to our board of directors regarding the identification, assessment and management of risks and management’s strategic approach to risk mitigation. Our Lead Independent Director and Chair of our audit and risk committee meet with our Internal Audit Lead, Chief Financial Officer, Chief Compliance Officer and Chief Legal Officer on a regular cadence to identify and discuss risks and exposures, and escalate potential issues to our audit and risk committee or board of directors, as appropriate.
As part of our overall risk management process, we conduct an annual Enterprise Risk Assessment (“ERA”), which is shared and discussed with our board of directors. Oversight of the ERA is supported and enabled by our audit and risk committee. Our board of directors’ oversight of the ERA framework includes a routine evaluation, with discussions with key management and outside advisors, as appropriate, of the processes used to identify, assess, monitor and report on risks across the organization and the setting and communication of the organization’s implementation and measurement of risk tolerances, limits and mitigation. Our board of directors, management and functional leaders of our ERA define our primary risk focus area for review. These areas include strategic, operational, people, financial and compliance. We address risks such as cybersecurity, financial reporting and competition within each of these areas.
While our board of directors maintains ultimate responsibility for the oversight of risk, it has implemented a multi-layered approach that delegates certain responsibilities to the appropriate board committees to ensure that these primary areas of focus are discussed in detail and that a full understanding of the applicable risk is obtained. Our board of directors and its committees oversee risks associated with their respective areas of responsibility, as summarized below. Each board committee meets in executive session with key management personnel and representatives of outside advisors as required or requested. Our board of directors may delegate additional risk areas to its committees in the future.
Board of Directors / |
|
Primary Areas of Risk Oversight |
|
|
|
Full Board of Directors |
|
Strategic, financial and execution risks and exposures associated with our business strategy, policy matters, succession planning, significant litigation and regulatory exposures and other current matters that may present material risk to our financial performance, operations, infrastructure, plans, prospects or reputation, acquisitions and divestitures and our operational infrastructure. |
|
|
|
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Audit and Risk Committee |
|
Risks and exposures associated with financial matters, particularly financial reporting, tax, accounting, disclosure controls and procedures, internal control over financial reporting, investment guidelines and credit and liquidity matters, our programs and policies relating to legal and regulatory compliance, data privacy, data security, cybersecurity and operational security and reliability, as well as matters of risk related to Square Financial Services. |
|
|
|
Nominating and Corporate Governance Committee |
|
Risks and exposures associated with director and executive succession planning; conflicts of interest; environmental, social, corporate governance, inclusion and diversity, and corporate responsibility matters; and overall board and committee effectiveness and composition, as well as governance related matters related to Square Financial Services. |
|
|
|
Compensation Committee |
|
Risks and exposures associated with leadership assessment, retention and succession, executive compensation programs and arrangements and our compensation philosophy and practices. |
Board’s Role in Data Privacy and Cybersecurity Oversight
Our board of directors is committed to mitigating data privacy and cybersecurity risks and recognizes the importance of these issues as part of our risk management framework. While the board of directors maintains ultimate responsibility for the oversight of our data privacy and cybersecurity program and risks, it has delegated certain responsibilities to our audit and risk committee. This committee-level focus on data privacy and cybersecurity allows the board to further enhance its understanding of these issues. The audit and risk committee assists the board of directors in its oversight of our data privacy and cybersecurity needs by staying apprised of our data privacy and information security programs, strategy, policies, standards, architecture, processes and material risks, and overseeing responses to security and data incidents.
Our board of directors and audit and risk committee’s principal role is one of oversight, recognizing that management is responsible for the design, implementation and maintenance of an effective program for protecting against and mitigating data privacy and cybersecurity risks. The full board of directors undergoes annual information security and privacy training by our Chief Information Security Officer and our Chief Privacy Officer, which covers, among other matters, board oversight obligations and the privacy and security programs in place at Block. Our audit and risk committee receives updates, at least quarterly, on material data privacy and security risks, including any material incidents, relevant industry developments, threat vectors and material risks identified in periodic penetration tests or vulnerability scans. The committee’s updates also include material legal and legislative developments concerning data privacy and security, Block’s approach to complying with applicable law and material engagement with regulators concerning data privacy and cybersecurity. Members of the board of directors stay apprised of the rapidly evolving cyber threat landscape and provide guidance to management as appropriate in order to address the effectiveness of our overall data privacy and cybersecurity program.
ESG and Corporate Responsibility
Our nominating and corporate governance committee oversees our corporate responsibility initiatives. We believe that as a company with a diverse ecosystem of products and services, Block has a tremendous opportunity to empower businesses, artists, and individuals to participate in the economy, as well as to operate a responsible and sustainable business while fostering an inclusive environment for its employees, customers, communities and shareholders. We are committed to managing the risks and opportunities that arise from ESG issues and maintaining our strong focus on sustainability. During 2022 and early 2023, we met with several investors to review our ESG initiatives. We discussed a wide variety of topics, including progress tracking of initiatives, metrics disclosure, investor usage of third-party ESG ratings, data security and privacy, our governance structure and board refreshment.
We take an integrated approach to managing ESG performance and disclosure:
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Key areas of focus for our ESG strategy are:
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Director Compensation
Pursuant to our Outside Director Compensation Policy, our non-employee directors receive compensation in the form of equity granted under the terms of our 2015 Equity Incentive Plan, as amended and restated (the “2015 Plan”), and cash, as described below. Our 2015 Plan contains maximum limits on the size of the equity awards that can be granted to each of our non-employee directors in any fiscal year, but those maximum limits do not reflect the intended size of any potential grants or a commitment to make any equity award grants to our non-employee directors in the future. The only commitment to make equity award grants to our non-employee directors is under our Outside Director Compensation Policy, as it may be amended from time to time. The maximum limits under our 2015 Plan provide that no non-employee director may be granted, in any fiscal year, equity awards having a grant date fair value (determined in accordance with generally accepted accounting principles (“GAAP”)) of more than $1 million, provided that the limit is $2 million in connection with the director’s initial service as a non-employee director. Equity awards granted to an individual while they were an employee or a consultant, but not a non-employee director, do not count for purposes of these limits.
Our compensation committee periodically reviews our Outside Director Compensation Policy, including review of competitive practices provided by Compensia, Inc., an independent compensation consulting firm engaged by our compensation committee (“Compensia”). In 2022, based on data provided by Compensia, our average total direct compensation per director (including annual cash retainer and equity awards) approximated the 10th percentile amongst our compensation peer group identified below in the section entitled “Executive Compensation—Compensation-Setting Process—Competitive Positioning.”
Equity Compensation.
Initial Award. Subject to any limits in our 2015 Plan, each person who first becomes a non-employee director will receive an initial grant of restricted stock units (“RSUs”) on the date of their appointment having a grant date fair value (determined in accordance with GAAP) equal to $250,000 multiplied by a fraction: (i) the numerator of which is (x) 12 minus (y) the number of months between the date of the last annual meeting of stockholders and the date the non-employee director becomes a member of our board of directors and (ii) the denominator of which is 12. However, if a person first becomes a non-employee director on the day of an annual meeting of stockholders, they will only receive an annual award (described below) on such date, but will not receive an initial award. The shares of our Class A common stock underlying the RSUs vest in full upon the earlier of (i) the first anniversary of the grant date or (ii) the date of the next annual meeting of stockholders, in each case subject to continued service through the vesting date. If the appointment date is the same as the date of annual meeting, then such outside director will only be granted an annual award.
Annual Award. On the date of each annual meeting of stockholders, and subject to any limits in our 2015 Plan, each of our non-employee directors is granted RSUs having a grant date fair value (determined in accordance with GAAP) equal to $250,000. The shares of our Class A common stock underlying the RSUs vest in full upon the earlier of (i) the first anniversary of the grant date or (ii) on the date of the next annual meeting of stockholders, in each case subject to continued service through the vesting date.
Our Lead Independent Director receives an annual grant of RSUs, in addition to the annual grant provided to all non-employee directors, on the date of each annual meeting of stockholders having a grant date fair value (determined in accordance with GAAP) of $70,000, subject to any limits in our 2015 Plan. The shares of our Class A common stock underlying the RSUs vest in full upon the earlier of (i) the first anniversary of the grant date or (ii) the date of the next annual meeting of stockholders, in each case subject to continued service through the vesting date.
The awards granted to a non-employee director under our Outside Director Compensation Policy will become fully vested upon a “change in control” as defined in our 2015 Plan.
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Cash Compensation. Each of our non-employee directors receives an annual cash retainer of $40,000 for serving on our board of directors. In addition, each year, non-employee directors are eligible to receive the following cash fees for service on the committees of our board of directors.
Board Committee |
|
Chair Fee |
|
|
Member Fee |
|
||
Audit and Risk Committee |
|
$ |
20,000 |
|
|
$ |
10,000 |
|
Compensation Committee |
|
$ |
15,000 |
|
|
$ |
5,000 |
|
Nominating and Corporate Governance Committee |
|
$ |
10,000 |
|
|
$ |
2,500 |
|
Subject to any limits under our 2015 Plan, each non-employee director may elect to convert any cash compensation that they would otherwise be entitled to receive under our Outside Director Compensation Policy into an award of RSUs under our 2015 Plan. If the non-employee director makes this election in accordance with the policy, each such award of RSUs will be granted on the first business day following the last day of the fiscal quarter for which the cash compensation otherwise would be paid under the policy, will be fully vested on the grant date, and will cover a number of shares equal to (A) the aggregate amount of cash compensation otherwise payable to the non-employee director on that date divided by (B) the closing price per share as of the last day of the fiscal quarter for which the grant relates.
2022 Compensation
The following table provides information regarding the total compensation that was earned by each of our non-employee directors in 2022. Mr. Viniar and Dr. Patterson served as directors until our 2022 annual meeting of stockholders in June 2022.
The amounts under the “Stock Awards” column represent the aggregate of initial or annual equity compensation provided under the Outside Director Compensation Policy, and equity grants made in lieu of cash compensation, each as detailed in footnotes 2 and 3, respectively. The aggregate number of stock awards outstanding at December 31, 2022 are included in footnote 2 below.
Director |
|
Fees Earned or |
|
|
Stock Awards |
|
|
All Other |
|
|
Total ($) |
|
||||
Roelof Botha |
|
|
— |
|
|
|
375,524 |
|
|
|
— |
|
|
|
375,524 |
|
Amy Brooks |
|
|
— |
|
|
|
292,784 |
|
|
|
— |
|
|
|
292,784 |
|
Shawn Carter |
|
|
— |
|
|
|
290,152 |
|
|
|
— |
|
|
|
290,152 |
|
Paul Deighton |
|
|
50,934 |
|
|
|
249,944 |
|
|
|
— |
|
|
|
300,878 |
|
Randy Garutti |
|
|
50,000 |
|
|
|
249,944 |
|
|
|
— |
|
|
|
299,944 |
|
James McKelvey |
|
|
— |
|
|
|
290,152 |
|
|
|
— |
|
|
|
290,152 |
|
Mary Meeker |
|
|
— |
|
|
|
305,576 |
|
|
|
— |
|
|
|
305,576 |
|
Anna Patterson |
|
|
— |
|
|
|
35,595 |
|
|
|
— |
|
|
|
35,595 |
|
Sharon Rothstein |
|
|
28,906 |
|
|
|
333,223 |
|
|
|
— |
|
|
|
362,129 |
|
Lawrence Summers |
|
|
50,000 |
|
|
|
249,944 |
|
|
|
— |
|
|
|
299,944 |
|
David Viniar |
|
|
— |
|
|
|
44,468 |
|
|
|
— |
|
|
|
44,468 |
|
Darren Walker |
|
|
— |
|
|
|
292,784 |
|
|
|
— |
|
|
|
292,784 |
|
|
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Table of Contents
Name |
|
Grant Date |
|
Number of RSUs |
|
|
Grant Date Fair |
|
|
Total Cash Retainer |
|
|||
Roelof Botha |
|
January 3, 2022 |
|
|
85 |
|
|
|
13,943 |
|
|
|
13,750 |
|
|
|
April 1, 2022 |
|
|
101 |
|
|
|
13,496 |
|
|
|
13,750 |
|
|
|
July 1, 2022 |
|
|
223 |
|
|
|
14,250 |
|
|
|
13,750 |
|
|
|
October 3, 2022 |
|
|
250 |
|
|
|
13,945 |
|
|
|
13,750 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Amy Brooks |
|
January 3, 2022 |
|
|
65 |
|
|
|
10,662 |
|
|
|
10,625 |
|
|
|
April 1, 2022 |
|
|
78 |
|
|
|
10,422 |
|
|
|
10,625 |
|
|
|
July 1, 2022 |
|
|
172 |
|
|
|
10,991 |
|
|
|
10,625 |
|
|
|
October 3, 2022 |
|
|
193 |
|
|
|
10,766 |
|
|
|
10,625 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Shawn Carter |
|
January 3, 2022 |
|
|
61 |
|
|
|
10,006 |
|
|
|
10,000 |
|
|
|
April 1, 2022 |
|
|
73 |
|
|
|
9,754 |
|
|
|
10,000 |
|
|
|
July 1, 2022 |
|
|
162 |
|
|
|
10,352 |
|
|
|
10,000 |
|
|
|
October 3, 2022 |
|
|
181 |
|
|
|
10,096 |
|
|
|
10,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Jim McKelvey |
|
January 3, 2022 |
|
|
61 |
|
|
|
10,006 |
|
|
|
10,000 |
|
|
|
April 1, 2022 |
|
|
73 |
|
|
|
9,754 |
|
|
|
10,000 |
|
|
|
July 1, 2022 |
|
|
162 |
|
|
|
10,352 |
|
|
|
10,000 |
|
|
|
October 3, 2022 |
|
|
181 |
|
|
|
10,096 |
|
|
|
10,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Mary Meeker |
|
January 3, 2022 |
|
|
85 |
|
|
|
13,943 |
|
|
|
13,750 |
|
|
|
April 1, 2022 |
|
|
101 |
|
|
|
13,496 |
|
|
|
13,750 |
|
|
|
July 1, 2022 |
|
|
223 |
|
|
|
14,250 |
|
|
|
13,750 |
|
|
|
October 3, 2022 |
|
|
250 |
|
|
|
13,945 |
|
|
|
13,750 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Anna Patterson |
|
January 3, 2022 |
|
|
77 |
|
|
|
12,630 |
|
|
|
12,500 |
|
|
|
April 1, 2022 |
|
|
92 |
|
|
|
12,293 |
|
|
|
12,500 |
|
|
|
July 1, 2022 |
|
|
167 |
|
|
|
10,671 |
|
|
|
10,302 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
David Viniar |
|
January 3, 2022 |
|
|
96 |
|
|
|
15,747 |
|
|
|
15,625 |
|
|
|
April 1, 2022 |
|
|
115 |
|
|
|
15,366 |
|
|
|
15,625 |
|
|
|
July 1, 2022 |
|
|
209 |
|
|
|
13,355 |
|
|
|
12,878 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Darren Walker |
|
January 3, 2022 |
|
|
65 |
|
|
|
10,662 |
|
|
|
10,625 |
|
|
|
April 1, 2022 |
|
|
78 |
|
|
|
10,422 |
|
|
|
10,625 |
|
|
|
July 1, 2022 |
|
|
172 |
|
|
|
10,991 |
|
|
|
10,625 |
|
|
|
October 3, 2022 |
|
|
193 |
|
|
|
10,766 |
|
|
|
10,625 |
|
Directors may be reimbursed for their reasonable expenses for attending board and committee meetings. Directors who are also our employees receive no additional compensation for their service as directors. During 2022, only Mr. Dorsey was an employee. For additional information regarding Mr. Dorsey's compensation, refer to the section entitled “Executive Compensation."
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Stock Ownership Guidelines
Our board of directors has adopted stock ownership guidelines to ensure ongoing alignment of the interests of our directors and executive officers with the long-term interests of our stockholders. Our guidelines require that (i) each non-employee director own a number of shares of our common stock with a value equal to at least five times their annual cash retainer, (ii) each executive officer (other than the Block Head) own a number of shares of our common stock with a value equal to at least three times their annual base salary and (iii) the Block Head own a number of shares of our common stock with a value equal to at least the greater of (x) five times their annual base salary and (y) $2 million. Each non-employee director and executive officer is required to comply with our stock ownership guidelines by the later of April 30, 2022, or five years from their promotion or hiring as an executive officer or election to our board of directors. Until a non-employee director or executive officer has satisfied their applicable level of ownership, they are required to retain an amount equal to fifty percent (50%) of the net shares received from any new equity award granted after the adoption of the guidelines. As of December 31, 2022, all of our non-employee directors and executive officers had met or were on track to comply with these stock ownership guidelines within the applicable time periods.
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|
PROPOSAL NO. 1 |
In accordance with our amended and restated certificate of incorporation, our board of directors is divided into three staggered classes of directors. The four Class II directors, Messrs. Botha, Carter and McKelvey and Ms. Brooks, are standing for election at the Annual Meeting for a three-year term.
Each director’s term continues until the election and qualification of their successor, or such director’s earlier death, resignation or removal. Any increase or decrease in the number of directors will be distributed among the three classes so that, as nearly as possible, each class will consist of one-third of our directors.
Nominees
Our nominating and corporate governance committee has recommended, and our board of directors has approved, Roelof Botha, Amy Brooks, Shawn Carter and James McKelvey as nominees for election as Class II directors at the Annual Meeting. If elected, each of Messrs. Botha, Carter and McKelvey and Ms. Brooks, will serve as Class II directors until our 2026 annual meeting of stockholders and until their successors are duly elected and qualified. Each of the nominees is currently a director of our company. Mr. Carter is standing for election by our stockholders for the first time. For additional information regarding our nominees for the board of directors, refer to the section entitled “Board of Directors and Corporate Governance.”
If you are a stockholder of record and you sign your proxy card or vote by telephone or over the Internet, but do not give instructions with respect to the voting of directors, your shares will be voted “FOR” the election of Messrs. Botha, Carter and McKelvey and Ms. Brooks. We expect that Messrs. Botha, Carter and McKelvey and Ms. Brooks will each agree to serve as a director; however, in the event that a director nominee is unable or declines to serve as a director at the time of the Annual Meeting, the proxies will be voted for any nominee designated by our board of directors to fill such vacancy. If you are a street name stockholder and you do not give voting instructions to your broker or nominee, your broker will leave your shares unvoted on this matter.
Vote Required
The election of directors requires a plurality of the voting power of the shares of our common stock present virtually or by proxy at the Annual Meeting and entitled to vote thereon to be approved. Broker non-votes will have no effect on this proposal.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” EACH OF THE NOMINEES NAMED ABOVE. |
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PROPOSAL NO. 2 |
The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”) enables our stockholders to approve, on an advisory or non-binding basis, the compensation of our named executive officers as disclosed pursuant to Section 14A of the Exchange Act. This proposal, commonly known as a “Say-on-Pay” proposal, gives our stockholders the opportunity to express their views on our named executive officers’ compensation. This vote is not intended to address any specific item of compensation or any specific named executive officer, but rather the overall compensation of all of our named executive officers and the philosophy, policies and practices described in this proxy statement. We currently hold our Say-on-Pay vote every year.
The Say-on-Pay vote is advisory, and therefore is not binding on us, our compensation committee or our board of directors. The Say-on-Pay vote will, however, provide information to us regarding investor sentiment about our executive compensation philosophy, policies and practices, which our compensation committee will consider when determining executive compensation for the remainder of the current fiscal year and beyond. Our board of directors and our compensation committee value the opinions of our stockholders. To the extent there is any significant vote against the compensation of our named executive officers as disclosed in this proxy statement, we will endeavor to communicate with stockholders to better understand the concerns that influenced the vote and consider our stockholders’ concerns, and our compensation committee will evaluate whether any actions are necessary to address those concerns.
We believe that the information provided in the section entitled “Executive Compensation,” and in particular the information discussed in the section entitled “Executive Compensation—Compensation Philosophy,” demonstrates that our executive compensation program was designed appropriately and is working to ensure management’s interests are aligned with our stockholders’ interests to support long-term value creation. Accordingly, we ask our stockholders to vote “FOR” the following resolution at the Annual Meeting:
“RESOLVED, that the stockholders approve, on an advisory basis, the compensation paid to our named executive officers, as disclosed in the proxy statement for the Annual Meeting pursuant to the compensation disclosure rules of the SEC, including the compensation discussion and analysis, compensation tables and narrative discussion and other related disclosure.”
Vote Required
The approval, on an advisory basis, of the compensation of our named executive officers requires the affirmative vote of a majority of the voting power of the shares of our common stock present virtually or by proxy at the Annual Meeting and entitled to vote thereon. Abstentions will have the effect of a vote against this proposal, and broker non-votes will have no effect.
As an advisory vote, the result of this proposal is non-binding. Although the vote is non-binding, our board of directors and our compensation committee value the opinions of our stockholders and will consider the outcome of the vote when making future compensation decisions for our named executive officers.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE APPROVAL, ON AN ADVISORY BASIS, OF THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS. |
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PROPOSAL NO. 3 RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM |
Our audit and risk committee has appointed Ernst & Young LLP (“EY”) as our independent registered public accounting firm to audit our consolidated financial statements for our fiscal year ending December 31, 2023. During our fiscal year ended December 31, 2022, EY served as our independent registered public accounting firm.
Notwithstanding the appointment of EY, and even if our stockholders ratify the appointment, our audit and risk committee, in its discretion, may appoint another independent registered public accounting firm at any time during our fiscal year if our audit and risk committee believes that such a change would be in the best interests of our company and our stockholders. At the Annual Meeting, our stockholders are being asked to ratify the appointment of EY as our independent registered public accounting firm for our fiscal year ending December 31, 2023. Although not required by applicable law or listing rules, our audit and risk committee is submitting the appointment of EY to our stockholders because we value our stockholders’ views on our independent registered public accounting firm and as a matter of good corporate governance. Representatives of EY will be present at the Annual Meeting, and they will have an opportunity to make a statement and will be available to respond to appropriate questions from our stockholders.
If our stockholders do not ratify the appointment of EY, our audit and risk committee may reconsider the appointment.
Fees Paid to the Independent Registered Public Accounting Firm
The following table presents fees for professional audit services and other services rendered to our company by EY for our fiscal years ended December 31, 2021, and December 31, 2022, respectively.
|
|
2021 |
|
|
2022 |
|
||
|
|
(in thousands) |
|
|||||
Audit Fees⁽¹⁾⁽²⁾ |
|
$ |
7,742 |
|
|
$ |
11,797 |
|
Audit-Related Fees⁽²⁾ |
|
|
— |
|
|
|
— |
|
Tax Fees⁽³⁾ |
|
|
152 |
|
|
|
725 |
|
All Other Fees⁽⁴⁾ |
|
|
5 |
|
|
|
8 |
|
Total Fees |
|
$ |
7,899 |
|
|
$ |
12,530 |
|
|
Auditor Independence
In our fiscal year ended December 31, 2022, there were no other professional services provided by EY, other than those listed above, that would have required our audit and risk committee to consider their compatibility with maintaining the independence of EY.
Audit and Risk Committee Policy on Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm
Our audit and risk committee has established a policy governing our use of the services of our independent registered public accounting firm. Under this policy, our audit and risk committee is required to pre-approve all audit, internal control-related services and permissible non-audit services performed by
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our independent registered public accounting firm in order to ensure that the provision of such services does not impair the public accountants’ independence. All services provided by EY for our fiscal year ended December 31, 2022, were pre-approved by our audit and risk committee pursuant to this policy.
Vote Required
The ratification of the appointment of EY as our independent registered public accounting firm for our fiscal year ending December 31, 2023, requires the affirmative vote of a majority of the voting power of the shares of our common stock present virtually or by proxy at the Annual Meeting and entitled to vote thereon. Abstentions will have the effect of a vote against this proposal. Because this is a routine proposal, we do not expect broker non-votes on this proposal.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM. |
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PROPOSAL NO. 4 STOCKHOLDER PROPOSAL REGARDING OUR DIVERSITY AND INCLUSION DISCLOSURE |
We have been notified that Nia Impact Capital, on behalf of Nia Capital Foundation, 4900 Shattuck Ave #3648, Oakland, CA 94609-7024, which reports that it was the beneficial owner of at least $25,000 of our Class A common stock for at least one year as of December 15, 2022, intends to present the proposal below for consideration at the Annual Meeting. The proposal and the supporting statement appear below as received by us. We are not responsible for the accuracy or content of the proposal and supporting statement.
Report to shareholders on the effectiveness of the Block’s diversity, equity, and inclusion efforts (“DEI”)
RESOLVED: Shareholders request that Block Inc. ("Block") report to shareholders on the effectiveness of the Company's diversity, equity, and inclusion efforts. The report should be done at reasonable expense, exclude proprietary information, and provide transparency on outcomes, using quantitative metrics for hiring, retention, and promotion of employees, including data by gender, race, and ethnicity.
SUPPORTING STATEMENT AS RECEIVED BY BLOCK:
Quantitative data is sought so investors can assess and compare the effectiveness of companies' diversity, equity, and inclusion programs.
Whereas: Block has not released its consolidated EEO-1 form, nor has it shared sufficient quantitative hiring, retention, and promotion data to allow investors to determine the effectiveness of its human capital management programs. Best practice disclosure includes hiring, retention and promotion rate data by gender, race, and ethnicity in line with Equal Employment Opportunity Commission (EEOC) defined categories.
Ninety-four percent of the S&P 100 and 33 percent of the Russell 1000 have released, or have committed to release, their EEO-1 forms, a best practice in diversity data reporting. Between September 2020 and September 2022, S&P 100 companies increased by 298 percent their release of hiring rate data by gender, race and ethnicity; retention rate data by 481 percent; and promotion rate data by 300 percent.(1) Companies that release, or have committed to release, more inclusion data than Block include Autodesk, Cisco Systems, PayPal, Splunk, Twitter, and Visa. Block is increasingly a laggard in its decision to continue to withhold these data sets.
Numerous studies have pointed to the benefits of a diverse workforce. Their findings include:
Hiring, promotion and retention rate data show how well a company manages its workforce diversity.
Companies should look to hire the best talent. However, Black and Latino applicants face hiring challenges. Results of a meta-analysis of 24 field experiments found that, with identical resumes, white applicants received an average of 36 percent more callbacks than Black applicants and 24 percent more callbacks than Latino applicants.(5)
Promotion rates show how well diverse talent is nurtured at a company. Unfortunately, women and employees of color experience "a broken rung" in their careers; for every 100 men who are promoted, only
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86 women are. Women of color are particularly impacted, comprising 17 percent of the entry-level workforce and only four percent of executives.(6)
Retention rates show whether employees choose to remain at a company. Morgan Stanley has found that employee retention above industry average can indicate a competitive advantage and higher levels of future profitability.(7) Companies with high employee satisfaction have also been linked to annualized outperformance of over two percent.(8)
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Board of Directors’ Recommendation Against and Statement of Opposition to Proposal No. 4
Our board of directors recommends that stockholders vote "AGAINST" this proposal for the following reasons:
EEO-1 Form Already Published. The proposal’s supporting statement incorrectly states that we have not released our consolidated EEO-1 form. We published our 2021 EEO-1 form on the inclusion and diversity page of our website (block.xyz/inclusion) in September 2022, and plan to update this form annually.
Robust Diversity Data Already Published. In 2017, we published our first Workforce Diversity Report and since then have consistently provided updated reports that are posted on the inclusion and diversity page of our website, including our 2022 Workforce Diversity Report. These reports provide stockholders with robust data on the diversity of our workforce, including our progress in increasing representation for women and underrepresented racial/ethnic minorities. In addition to disclosing gender and race/ethnicity representation overall and within business, technical, and leadership roles, we believe that our transparency exceeds that of many of our peers because we disclose:
Existing disclosures also demonstrate our efforts to continue advancing DEI in the workplace. Furthermore, our annual Corporate Social Responsibility (“CSR”) Reports, which are available on the inclusion and diversity page of our website, also provide robust disclosure about our DEI efforts. For example, our 2022 CSR Report describes the following initiatives we have undertaken to promote DEI within our Company and in our communities:
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We believe that the data disclosed and efforts described in our Workforce Diversity and CSR Reports enable our stockholders to evaluate our commitment to DEI and our progress on increasing workforce diversity.
We have a strong commitment to transparency and engagement. Dialogue with our stockholders is an important part of how we gauge our progress on transparency in DEI reporting. To that end, we have engaged in constructive discussions with a number of our stockholders regarding how we can continue to improve our DEI reporting. The following are changes we are making as a result of conversations with our stockholders:
For additional detail on how we have actively increased our DEI efforts over the past year, refer to the section in this proxy statement entitled “ESG and Corporate Responsibility” and to our 2022 Workforce Diversity and CSR Reports.
There is robust board oversight over DEI. Our nominating and corporate governance committee is responsible for overseeing our DEI efforts and receives quarterly inclusion and diversity reports from our Inclusion and Diversity Lead. Our board of directors is actively involved in DEI reporting and regularly engages with leadership to review and align with our DEI progress and provide feedback as to the effectiveness of our programs. In light of our existing initiatives, policies and disclosures with respect to DEI, our board of directors believes the current scope of our reporting provides our stockholders with visibility into our DEI efforts in addition to a way to evaluate these efforts over time.
For these reasons, we believe the preparation of data on the hiring, retention, and promotion of employees as requested by this proposal would divert resources away from our continued DEI efforts without providing any meaningful additional information to our stockholders.
Vote Required
Approval of this stockholder proposal requires the affirmative vote of a majority of the voting power of the shares of our common stock present virtually or by proxy at the Annual Meeting and entitled to vote thereon. Abstentions will have the effect of a vote against this proposal, and broker non-votes will have no effect.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE “AGAINST” THIS STOCKHOLDER PROPOSAL. |
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REPORT OF THE AUDIT AND RISK COMMITTEE |
The audit and risk committee is a committee of our board of directors comprised solely of independent directors as required by NYSE listing standards and the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). The composition of the audit and risk committee, the attributes of its members and the responsibilities of the audit and risk committee, as reflected in its charter, are intended to be in accordance with applicable requirements for corporate audit committees. With respect to our financial reporting process, our management is responsible for (1) establishing and maintaining internal controls and (2) preparing our consolidated financial statements. Our independent registered public accounting firm, Ernst & Young LLP (“EY”), is responsible for performing an independent audit of our consolidated financial statements. It is the responsibility of the audit and risk committee to oversee these activities. It is not the responsibility of the audit and risk committee to prepare our financial statements. These are the fundamental responsibilities of management. In the performance of its oversight function, the audit and risk committee has:
Based on the audit and risk committee’s review and discussions with management and EY, the audit and risk committee recommended to the board of directors that the audited financial statements be included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2022, for filing with the SEC.
Respectfully submitted by the members of the audit and risk committee of the board of directors:
Paul Deighton (Chair)
Roelof Botha
Lawrence Summers
Darren Walker
This report of the audit and risk committee is required by the SEC and, in accordance with the SEC’s rules, will not be deemed to be part of or incorporated by reference by any general statement incorporating by reference this proxy statement into any filing under the Securities Act of 1933, as amended (“Securities Act”), or under the Securities Exchange Act of 1934, as amended (“Exchange Act”), except to the extent that we specifically incorporate this information by reference, and will not otherwise be deemed “soliciting material” or “filed” under either the Securities Act or the Exchange Act.
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EXECUTIVE OFFICERS |
The following table identifies certain information about our executive officers as of April 28, 2023. Our executive officers are appointed by, and serve at the discretion of, our board of directors. There are no family relationships among any of our directors or executive officers.
Name |
|
|
Age |
|
|
Position |
Jack Dorsey |
|
|
46 |
|
|
Block Head and Chairperson |
Amrita Ahuja |
|
|
43 |
|
|
Chief Operating Officer and Chief Financial Officer |
Brian Grassadonia |
|
|
40 |
|
|
Chief Executive Officer, Cash App |
Alyssa Henry |
|
|
52 |
|
|
Chief Executive Officer, Square |
Chrysty Esperanza |
|
|
44 |
|
|
Chief Legal Officer and Corporate Secretary |
For biographical information for Jack Dorsey, refer to the section entitled “Board of Directors and Corporate Governance.”
Amrita Ahuja has served as our Chief Operating Officer since February 2023, and as our Chief Financial Officer since January 2019. From March 2018 to January 2019, Ms. Ahuja served as the Chief Financial Officer of Blizzard Entertainment, Inc., a division of Activision Blizzard, Inc. Beginning in June 2010, she served in various positions at Activision Blizzard, Inc., including as Senior Vice President of Investor Relations from January 2015 to May 2018, Vice President, Finance and Operations from August 2012 to January 2015 and Vice President, Strategy and Business Development from June 2010 to August 2012. Ms. Ahuja currently serves on the boards of directors of Airbnb, Inc. and a privately held company. She holds a B.A. in economics from Duke University and an M.B.A. from Harvard Business School.
Brian Grassadonia has served as Chief Executive Officer of Cash App (formerly referred to as Cash App Lead) since January 2013. From May 2012 to January 2013, Mr. Grassadonia served as our Director of Product Development, as well as our Director of Growth from February 2011 to May 2012. He joined the Company in September 2010 and served as Product Manager until February 2011. Mr. Grassadonia currently serves on the board of directors of a privately held company. Mr. Grassadonia holds a Bachelor of Applied Science (BASc) in Management Science from the University of California, San Diego.
Alyssa Henry has served as Chief Executive Officer of Square (formerly referred to as Square Lead) since October 2014. From May 2014 to October 2014, Ms. Henry served as our Engineering Lead, Infrastructure. From April 2006 to April 2014, Ms. Henry served in various positions at Amazon.com, Inc. (“Amazon”), including as Vice President, Amazon Web Services Storage Services, and as General Manager of Amazon S3. Prior to Amazon, Ms. Henry held technical and leadership roles at Microsoft from 1994 to 2006. Ms. Henry currently serves on the boards of directors of Intel Corporation and Confluent, Inc., and previously served on the board of directors of Unity Software, Inc. from October 2019 to November 2022. Ms. Henry holds a B.S. in Mathematics-Applied Science with a Specialization in Computing from the University of California, Los Angeles.
Chrysty Esperanza has served as our Chief Legal Officer and Corporate Secretary since February 2023, having previously served as our General Counsel since December 2021 and Assistant Corporate Secretary since June 2021. From April 2020 to December 2021, Ms. Esperanza served as our Deputy General Counsel and from October 2013 to April 2020, she served as our Counsel Lead. Ms. Esperanza currently serves on the board of trustees for the San Francisco Friends School. Ms. Esperanza holds a B.A. in Mass Communication/Business Administration from the University of California, Los Angeles and a J.D. from the University of California College of the Law, San Francisco (formerly known as the University of California, Hastings College of Law).
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EXECUTIVE COMPENSATION |
Compensation Discussion and Analysis
This Compensation Discussion and Analysis summarizes the material components of our executive compensation program and our executive compensation policies, practices and material compensation decisions for 2022 for our “named executive officers.” Our named executive officers for 2022 were:
Jack Dorsey |
Block Head and Chairperson |
Amrita Ahuja(1) |
Chief Operating Officer and Chief Financial Officer |
Brian Grassadonia |
Chief Executive Officer, Cash App |
Alyssa Henry |
Chief Executive Officer, Square |
Sivan Whiteley(2) |
Chief Legal Officer and Corporate Secretary |
|
|
Compensation Philosophy
Block's purpose is economic empowerment. We build tools to help more people access the economy. Square helps sellers run and grow their businesses with its integrated ecosystem of commerce solutions, business software and banking services. With Cash App, anyone can easily send, spend or invest their money in stocks or bitcoin. Artists use TIDAL to help them succeed as entrepreneurs and connect more deeply with their fans. TBD is building an open developer platform to make it easier to access bitcoin and other blockchain technologies without having to go through an institution. Our customers inspire us in how they innovate, take risks and take ownership. We want our employees, like our customers, to act like owners. Our compensation approach reflects this philosophy.
To this end, our compensation programs are designed to attract, retain and grow the best teams while reflecting the core tenets of our culture:
Compensation Design and Objectives
In 2022, we continued to maintain a simplified approach to employee and executive compensation. Compensation for our named executive officers consists largely of base salary and equity awards intended to align incentives to grow our business. Equity incentives are provided through a combination of stock options and restricted stock-based awards. We believe that this combination provides an appropriate mix of performance-driven appreciation opportunities through stock options, and alignment of rewards with the long-term interests of our stockholders through restricted stock-based awards. We have not implemented a company-wide performance-based cash incentive plan for our employees, including our named executive officers, in order to conserve cash and maintain a simplified compensation program that focuses on delivering long-term growth rather than short-term results.
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The primary objective of our executive compensation program is to drive long-term stockholder value. We seek to achieve this objective by designing our executive compensation programs to:
For 2022, we made the following executive compensation decisions:
We conduct a comprehensive review of our compensation philosophy, objectives and design, including a review of our executive compensation program, on an annual cycle. We may implement new compensation plans and arrangements for our named executive officers and/or employees where we deem necessary or appropriate, including to attract or retain high-caliber talent to our organization or provide incentives for them to drive Block’s success.
Impact of 2022 Stockholder Advisory Vote on Executive Compensation
In June 2022, we conducted a non-binding, advisory vote on the compensation of our named executive officers, commonly referred to as a “say-on-pay” vote, at our 2022 annual meeting of stockholders. Our stockholders overwhelmingly voted to approve the compensation of the named executive officers, with more than 98% of the votes cast in favor of our executive compensation program.
The compensation committee was mindful of this strong support, and after considering this advisory vote result and evaluating our executive compensation policies and practices throughout 2022, determined that we should maintain the compensation philosophy and objectives from prior years and retain our general approach to executive compensation. As a result, the compensation committee decided to continue to provide compensation with an emphasis on equity compensation that rewards our most senior executives when they deliver value for our stockholders.
Consistent with the recommendation of our board of directors and the approval of our stockholders in connection with the advisory vote on the frequency of future say-on-pay votes conducted at our 2022 annual meeting of stockholders, the board of directors has adopted a policy providing for annual advisory votes on the compensation of our named executive officers. The next advisory vote on the frequency of future say-on-pay votes will occur at our 2028 annual meeting of stockholders.
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Compensation-Setting Process
Role of Our Compensation Committee
Our compensation committee administers and determines the parameters of the executive compensation program. Our compensation committee currently consists of Mses. Meeker and Rothstein and Messrs. Botha and Deighton, with Ms. Meeker serving as Chair. Each member qualifies as an “independent director” for purposes of the listing standards of the New York Stock Exchange. Each of Mses. Meeker and Rothstein and Messrs. Botha and Deighton qualify as a “non-employee director” for purposes of Rule 16b-3 under the Exchange Act. Our compensation committee may establish, and has in the past established, a subcommittee to which it delegates authority to grant and administer equity awards, in order to help promote compliance with Section 16 of the Exchange Act. For purposes of the discussion below, references to “compensation committee” shall mean the “subcommittee” for all actions taken with respect to such awards in 2022, except as otherwise noted.
Under its charter, our compensation committee reviews, approves and determines, or makes recommendations to our board of directors regarding, executive officer compensation. For additional information on our compensation committee, including its authority, refer to the section entitled “Board of Directors and Corporate Governance—Board Meetings and Committees—Compensation Committee."
Role of Management
Our Block Head, People Lead and members of our People team provide our compensation committee with information on corporate and individual performance, market data and their perspectives and recommendations on compensation matters. No named executive officer participates in deliberations regarding their own compensation.
For named executive officers that are hired externally, their initial compensation arrangements are determined through negotiations with each named executive officer. Typically, our Block Head provides input on the terms of these arrangements, with the oversight and final approval of our board of directors or our compensation committee. Compensation for individuals promoted into named executive officer positions is recommended by our Block Head and our People Lead, and reviewed and approved by the compensation committee.
In reviewing compensation for existing named executive officers, our compensation committee solicits input from our Block Head and our People Lead. Our compensation committee reviews their input on capability, job complexity and overall assessment of individual performance and contributions of each executive. Our compensation committee values our Block Head’s perspective and input on each named executive officer’s performance and contributions to our business. The input of our Block Head is an important factor that our compensation committee uses in making its executive compensation decisions, along with input from our external compensation advisors on market trends.
Role of Compensation Consultant
Our compensation committee has the authority to engage its own advisors to assist in carrying out its responsibilities. In 2022, our compensation committee continued to engage Compensia, an independent compensation consultant, to assist with its duties, including providing advice relating to our compensation peer group selection as well as providing support and specific analyses with regard to compensation data and formulation of recommendations for executive and non-employee director compensation. Compensia reports directly to our compensation committee and not to management, is independent from us and has provided no other services to us.
Our compensation committee has assessed the independence of Compensia, taking into account, among other matters, the enhanced independence standards and factors set forth in Exchange Act Rule 10C-1 and the applicable listing standards of the New York Stock Exchange, and concluded that there are no conflicts of interest regarding the work that Compensia performs for our compensation committee.
Competitive Positioning
In determining the compensation for our named executive officers, our compensation committee, with assistance from Compensia, reviews the compensation practices and levels of our compensation peer group. This compensation peer group analysis is used to assess whether our executive compensation
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program and individual compensation levels for our named executive officers are appropriately positioned to attract and retain high-performing talent.
Our compensation peer group is set forth below and was established for 2022 with input from Compensia. The compensation peer group was developed using a rules-based/mechanical approach and reflects publicly-traded companies with similar industry, geography and financial characteristics as us (including revenues of approximately forty percent (0.4x) to two and one half times (2.5x) and a market capitalization of approximately one quarter (0.25x) to four times (4.0x) Block’s respective levels at the time the peer group was selected). The group was further refined to include companies with one-year revenue growth greater than 10% or market capitalization per employee greater than $3 million. Our compensation committee intends to regularly review our compensation peer group and the underlying criteria to assess whether it remains appropriate for review and comparison purposes.
A number of companies that met the criteria for inclusion in our peer group in 2021 no longer met those criteria in 2022 and were removed from our 2022 peer group. Companies included in our peer group in 2021 but not in 2022 were Fortinet, GoDaddy, Lyft, Match Group, Splunk, Take-Two Interactive, Wayfair and Zillow Group. Similarly, companies that were outside our scoping metrics in 2021, but were within them in 2022, were added to our compensation peer group. Those companies are noted by a * in the list below. Accordingly, the compensation peer group used to inform our 2022 compensation decisions were:
Adobe |
Fiserv* |
ServiceNow |
Uber Technologies |
Affirm Holdings* |
Global Payments |
Shopify |
Workday |
Autodesk |
Intuit |
Snap |
Zoom Video* |
Coinbase Global* |
Palo Alto Networks |
Twilio |
|
eBay* |
PayPal Holdings |
|
Relative to our compensation peer group above, at the time of approval of our peer group in February 2022, Block ranked at the 94th percentile on a trailing four quarters GAAP revenue basis and at the 70th percentile on a market capitalization basis.
In addition to the companies listed above, the compensation committee reviewed the executive compensation programs and practices of Alphabet, Amazon, Apple, Facebook, Intel, IBM, Microsoft and salesforce.com for reference purposes only. We compete for talent with these reference companies, and the compensation committee believed it was important to understand their compensation practices in order to remain competitive.
Our compensation committee supplemented the compensation data from our compensation peer group with analysis of data from the Radford Compensation Survey. For this additional analysis, our compensation committee reviewed aggregate data from the Radford survey participants that were also members of our compensation peer group.
Though its analysis of competitive market data informs its decisions, our compensation committee also applies its subjective judgment in determining the pay levels of individual named executive officers. Additional factors our compensation committee considers when making its compensation decisions include input from our Block Head and our People Lead, company performance, individual performance and experience, individual skills and expertise, each named executive officer’s role and/or retention and incentive objectives.
Elements of Executive Compensation
Consistent with our compensation philosophy, our executive compensation program consists of only two primary elements: base salary and long-term incentive compensation in the form of equity awards. During 2022, we provided no cash-based incentive compensation opportunities to our named executive officers, instead focusing on linking compensation to stockholder value by using equity awards as the primary means of incentive compensation. We do not use specific formulas or weightings in determining the allocation between base salary and long-term incentive compensation; instead, each named executive
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officer’s compensation has been individually designed to provide a combination of fixed and at-risk compensation to provide incentives to achieve our objectives.
We also provide severance and change of control benefits for our named executive officers as part of our executive compensation program. To remain consistent with our compensation goals of fairness and simplicity, each named executive officer (other than our Block Head) is entitled to severance and change of control benefits based on the same formulas.
Our named executive officers also participate in several company-wide health and welfare benefit plans that are generally available to our other employees.
Base Salary
Base salary for our named executive officers is the fixed component of our executive compensation program. We use base salary to compensate our named executive officers for services rendered during the year and to recognize the experience, skills, knowledge and responsibilities required of each named executive officer. We apply no specific formula to determine adjustments to base salary. We continue to provide base salaries that are conservative relative to competitive market pay levels.
In April 2022, our compensation committee reviewed the base salaries of Mses. Ahuja, Henry, and Whiteley and Mr. Grassadonia, taking into consideration a competitive market analysis performed by Compensia, the recommendations of our Block Head and our People Lead, the desire to retain our highly qualified executive team and the other factors described above. Following this review, our compensation committee approved an increase in the annual base salary levels for Mses. Ahuja, Henry, and Whiteley and Mr. Grassadonia to $525,000, in each case effective as of April 1, 2022, in order to improve competitive alignment with our peers. In addition, our compensation committee determined that it was appropriate to keep our Block Head’s 2022 base salary level at $2.75 per year, at the request of our Block Head and with compensation committee approval.
The annualized base salaries of our named executive officers as of December 31, 2022, compared to December 31, 2021, were:
Named Executive Officer |
|
Annual Base |
|
|
Annual Base |
|
|
Percentage |
|
|||
Jack Dorsey |
|
$ |
2.75 |
|
|
$ |
2.75 |
|
|
|
0 |
% |
Amrita Ahuja |
|
$ |
500,000 |
|
|
$ |
525,000 |
|
|
|
5.0 |
% |
Brian Grassadonia |
|
$ |
500,000 |
|
|
$ |
525,000 |
|
|
|
5.0 |
% |
Alyssa Henry |
|
$ |
500,000 |
|
|
$ |
525,000 |
|
|
|
5.0 |
% |
Sivan Whiteley |
|
$ |
500,000 |
|
|
$ |
525,000 |
|
|
|
5.0 |
% |
Equity Compensation
We believe that sustainable long-term corporate performance is achieved with a corporate culture that encourages a long-term focus by all of our employees. We seek to incentivize this focus in our employees, including our named executive officers, through the use of equity-based awards, the value of which depends on the performance of our stock.
Equity awards are central to our executive compensation program, which is designed to promote fairness, maintain simplicity and provide rewards based on demonstrable performance. Equity ownership aligns the interests of our named executive officers with the interests of our stockholders by enabling them to participate in the long-term appreciation of the value of our common stock. Additionally, equity awards provide an important tool for us to retain our named executive officers, as awards are subject to vesting over a multi-year period subject to continued service with the company. Typically, these awards vest over four years, contingent on continued service, and the awards to our named executive officers in 2022 followed this practice.
Our executive compensation program provides equity incentives through a mix of stock options and restricted stock-based awards (currently awarded in the form of RSUs). Stock options provide executives with an opportunity to participate in stock price appreciation above their exercise price, creating incentives to continue to drive growth. Awards of RSUs and restricted stock awards (“RSAs”) create alignment with our long-term stockholders by providing both upside and downside tied to company performance. A mix of award types is also consistent with competitive practice among our peers. In determining the mix of stock
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options and RSUs for 2022, our compensation committee, with input from our Block Head, our People Lead and Compensia, considered competitive market practices and the retention and performance incentives of outstanding equity holdings and determined that a mix of approximately 50% stock options and 50% RSUs, based on the target grant value of the awards, provided appropriate incentives for the named executive officers in 2022. We do not have an established set of criteria for granting equity awards. Instead, our compensation committee has exercised its judgment and discretion, in consultation with our Block Head and our People Lead, and considered, among other factors, the role and responsibility of each named executive officer, competitive factors, the amount of equity compensation already held by our named executive officer (and the extent to which it was vested) and the cash compensation to be received by our named executive officer, to determine and approve the size and terms of new equity awards.
In 2022, we granted annual equity awards to our named executive officers described in the table below. In determining the size and terms of these annual equity awards for Mses. Ahuja, Henry and Whiteley and Mr. Grassadonia, our compensation committee, with input from our Block Head, our People Lead and Compensia, considered the past and expected future key contributions of each of these named executive officers, the extent to which their existing equity awards were vested and the competitive market data for similarly situated executives. Our compensation committee believed it was appropriate to grant each of them new equity awards to help achieve our retention goals and further align their compensation with the competitive market.
Named Executive Officer |
|
Number of Securities |
|
RSUs (#) |
|
Grant Date |
|
|
Amrita Ahuja |
|
84,061⁽¹⁾ |
|
42,031⁽²⁾ |
|
|
11,167,743 |
|
Brian Grassadonia |
|
96,671⁽¹⁾ |
|
48,336⁽²⁾ |
|
|
12,843,008 |
|
Alyssa Henry |
|
96,671⁽¹⁾ |
|
48,336⁽²⁾ |
|
|
12,843,008 |
|
Sivan Whiteley |
|
58,843⁽¹⁾ |
|
29,422⁽²⁾ |
|
|
7,817,479 |
|
|
Mr. Dorsey did not receive any equity awards in 2022 at his request, and because our compensation committee believed that his existing equity ownership position sufficiently aligned his interests with those of our stockholders.
On April 26, 2023, we entered into a Separation Agreement and Release with Ms. Whiteley in connection with the cessation of her employment (the "Separation Agreement"). The Separation Agreement provides that any of the awards of stock options under the 2015 Plan held by Ms. Whiteley that were vested and exercisable as of April 7, 2023 will remain outstanding and exercisable until the two-year anniversary of her termination of date, subject to Ms. Whiteley’s execution and non-revocation of the Separation Agreement.
No Special Retirement, Health or Welfare Benefits
Our named executive officers are eligible to participate in our employee benefit programs on the same basis as our other salaried employees. We maintain a tax-qualified retirement plan (“401(k) Plan”) that provides eligible employees with an opportunity to save for retirement on a tax-advantaged basis. Eligible employees are able to participate in the 401(k) Plan as of the date they meet the 401(k) Plan’s eligibility requirements, and participants are able to defer up to 65% of their eligible compensation subject to applicable annual tax limits. All participants’ interests in their deferrals are 100% vested when contributed. The 401(k) Plan permits us to make matching contributions and profit-sharing contributions. For the plan year beginning on January 1, 2022, we made a matching contribution equal to 100% of participants’ pre-tax and Roth contributions up to $2,000 and after that, 50% of participants’ pre-tax and Roth contributions
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up to a maximum matching contribution of $5,000 per participant. We have not made any profit-sharing contributions to date.
Our health and welfare benefits include medical; dental and vision; disability insurance; basic life insurance coverage; accidental death and dismemberment insurance and a monthly wellness allowance. We design our employee benefits programs to be affordable and competitive in relation to the market and compliant with applicable laws and practices. We adjust our employee benefits programs as needed based upon changes in applicable laws and market practices.
Limited Perquisites and Other Personal Benefits
We do not provide perquisites or other personal benefits to our named executive officers, except in limited situations where we believe it is appropriate to assist an individual in the performance of their duties, to make our named executive officers more efficient and effective and for recruitment and retention purposes.
Employment Agreements with Named Executive Officers
We have entered into a confirmatory employment letter with each of our named executive officers. The confirmatory employment letter has no specific term and provides for at-will employment.
Post-Employment Compensation
We have entered into change of control and severance agreements with our named executive officers that provide for certain specified payments and benefits if a termination of employment occurs under specified circumstances, including following a change of control of our company. We believe that these protections are necessary to provide our valuable executives with incentives to forgo other employment opportunities and remain employed with us and to maintain continued focus and dedication to their responsibilities to maximize stockholder value, including if there is a potential transaction that could involve a change of control. In addition, these protections are available only if a named executive officer executes and does not revoke a general release of claims in our favor. The terms of these agreements were determined by our compensation committee, with input from our management team, following a review of analysis prepared by Compensia of relevant market data for other companies with whom we compete for executive talent.
For a summary of the material terms of the change of control and severance agreements and an estimate of the payments and benefits that may be received by our named executive officers under these arrangements, refer to the section entitled “Potential Payments on Termination or Change of Control” below.
Other Compensation Information
Hedging and Pledging Prohibitions
We have an Insider Trading Policy, which, among other matters, prohibits our employees, including officers, or directors from making short sales, engaging in transactions in publicly traded options (such as puts and calls) and other derivative securities relating to our common stock, pledging any of our securities as collateral for a loan, and holding any of our securities in a margin account, whether such securities are granted as compensation or are held, directly or indirectly, by the employee or director. This prohibition extends to any hedging or similar transaction designed to decrease the risks associated with holding our securities.
Deductibility of Executive Compensation
Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), generally limits the amount we may deduct from our federal income taxes for compensation paid to our Block Head and certain other executive officers to $1 million per executive officer per year, subject to certain exceptions. Neither our compensation committee nor any authorized subcommittee, as applicable, has adopted a policy that all equity or other compensation must be deductible.
When approving the amount and form of compensation for our executive officers, we generally consider all elements of the cost to us of providing such compensation, including the potential impact of Section 162(m) of the Code, as well as our need to maintain flexibility in compensating executive officers in a manner designed to promote our goals. Our compensation committee or its authorized subcommittee, as
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applicable, may, in its judgment, authorize compensation payments that will or may not be deductible when it believes that such payments are appropriate to attract, retain or motivate executive talent.
Taxation of Parachute Payments and Deferred Compensation
We do not provide, and have no obligation to provide, any of our named executive officers with a “gross-up” or other reimbursement payment for any tax liability they might owe because of the application of Sections 280G, 4999 or 409A of the Code. If any of the payments or benefits provided for under the change of control and severance agreements or otherwise payable to a named executive officer would constitute “parachute payments” within the meaning of Section 280G of the Code and could be subject to the related excise tax, they would receive either full payment of such payments and benefits or such lesser amount that would cause no portion of the payments and benefits being subject to the excise tax, whichever results in the greater after-tax benefits to our named executive officer.
Accounting for Share-Based Compensation
Our compensation committee considers accounting effects in designing compensation plans and arrangements for our executive officers and other employees. Chief among these is ASC 718, the standard that governs the accounting treatment of stock-based compensation awards. ASC 718 requires companies to measure the compensation expense for all share-based payment awards made to employees and directors, including stock options and restricted stock-based awards, generally based on the grant date “fair value” of these awards. This calculation is performed for accounting purposes and reported in the compensation tables below, even though our executive officers may realize no value from their awards. ASC 718 also requires companies to recognize the compensation cost of their share-based payment awards in their income statements over the period that an executive officer is required to render service in exchange for the option or other award.
Stock Ownership Guidelines
We maintain stock ownership guidelines for our executive officers to ensure ongoing alignment of the interests of our executive officers with the long-term interests of our stockholders. For information concerning these guidelines, see the section entitled “Board of Directors and Corporate Governance—Stock Ownership Guidelines.”
Compensation “Clawback” Policy
The board of directors has adopted a policy that gives the board of directors (or any duly authorized committee of the board of directors) discretion to require that any of our executive officers, including our named executive officers, repay incentive-based compensation to our company if a majority of the independent members of the board of directors (or the committee to which it has delegated authority) determines that the executive officer’s gross negligence, intentional misconduct or fraud caused or partially caused us to materially restate all or a portion of our financial statements on which such compensation was calculated. Such determination must be made within three years of the date of filing of the applicable financial statements. The compensation committee believes that the clawback policy reduces the potential for excessive risk taking by executive officers.
Compensation Committee Report
The compensation committee has reviewed and discussed with management the Compensation Discussion and Analysis provided above. Based on its review and discussions, the compensation committee recommended to the board of directors that the Compensation Discussion and Analysis be included in this proxy statement and our Annual Report on Form 10-K for the fiscal year ended December 31, 2022.
|
Compensation Committee |
|
|
|
Mary Meeker (Chair) |
|
Roelof Botha |
|
Paul Deighton |
|
Sharon Rothstein |
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Compensation Risk Assessment
Our management team and our compensation committee each play a role in evaluating and mitigating any risk that may exist relating to our compensation programs, policies and practices for all employees, including our named executive officers. In connection with their oversight, Compensia and management conducted a risk review of our employee compensation plans and arrangements in which our employees (including our named executive officers) participate to determine whether these plans and arrangements have any features that might create undue risks or encourage unnecessary and excessive risk taking that could threaten our value. In this review, we considered numerous factors and design elements that enable us to monitor, manage and mitigate risk, without diminishing the effect of the incentive nature of compensation, including:
Based on our review, we have concluded that any potential risks arising from our employee compensation programs, policies and practices, including our executive compensation program, are not reasonably likely to have a material adverse effect on Block.
Summary Compensation Table for 2022
Name and Principal Position |
|
Year |
|
Salary ($) |
|
|
Stock |
|
|
Option |
|
|
All Other |
|
|
Total |
|
|||||
Jack Dorsey |
|
2022 |
|
|
2.75 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2.75 |
|
Block Head |
|
2021 |
|
|
2.75 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2.75 |
|
|
|
2020 |
|
|
2.75 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2.75 |
|
Amrita Ahuja |
|
2022 |
|
|
518,750 |
|
|
|
5,279,934 |
|
|
|
5,887,809 |
|
|
|
5,000 |
|
|
|
11,691,493 |
|
Chief Operating Officer and Chief Financial Officer |
|
2021 |
|
|
493,750 |
|
|
|
4,931,901 |
|
|
|
4,805,016 |
|
|
|
5,000 |
|
|
|
10,235,667 |
|
|
|
2020 |
|
|
468,750 |
|
|
|
3,783,406 |
|
|
|
4,385,035 |
|
|
|
183,155 |
|
|
|
8,820,346 |
|
Brian Grassadonia |
|
2022 |
|
|
518,750 |
|
|
|
6,071,968 |
|
|
|
6,771,040 |
|
|
|
5,000 |
|
|
|
13,366,758 |
|
Chief Executive Officer, Cash App |
|
2021 |
|
|
493,750 |
|
|
|
4,931,901 |
|
|
|
4,805,016 |
|
|
|
5,000 |
|
|
|
10,235,667 |
|
|
|
2020 |
|
|
468,750 |
|
|
|
3,783,406 |
|
|
|
4,385,035 |
|
|
|
5,030 |
|
|
|
8,642,221 |
|
Alyssa Henry |
|
2022 |
|
|
518,750 |
|
|
|
6,071,968 |
|
|
|
6,771,040 |
|
|
|
5,000 |
|
|
|
13,366,758 |
|
Chief Executive Officer, Square |
|
2021 |
|
|
493,750 |
|
|
|
4,931,901 |
|
|
|
4,805,016 |
|
|
|
5,000 |
|
|
|
10,235,667 |
|
|
|
2020 |
|
|
468,750 |
|
|
|
3,783,406 |
|
|
|
4,385,035 |
|
|
|
5,150 |
|
|
|
8,642,341 |
|
Sivan Whiteley |
|
2022 |
|
|
518,750 |
|
|
|
3,695,992 |
|
|
|
4,121,487 |
|
|
|
8,519 |
|
|
|
8,344,748 |
|
Former Chief Legal Officer and Corporate Secretary |
|
2021 |
|
|
493,750 |
|
|
|
3,561,943 |
|
|
|
3,470,304 |
|
|
|
8,783 |
|
|
|
7,534,780 |
|
|
|
2020 |
|
|
468,750 |
|
|
|
3,255,761 |
|
|
|
3,542,303 |
|
|
|
60,568 |
|
|
|
7,327,382 |
|
|
|
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Grants of Plan-Based Awards in 2022
The following table sets forth information regarding grants of awards made to our named executive officers during 2022. We did not grant any plan-based cash awards or RSAs during 2022.
Name |
|
Grant Date |
|
|
Number of |
|
|
Number of |
|
|
Exercise or |
|
|
Grant Date |
|
|||||
Jack Dorsey |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Amrita Ahuja |
|
4/19/2022 |
|
|
|
42,031 |
|
|
|
84,061 |
|
|
|
125.62 |
|
|
|
11,167,743 |
|
|
Brian Grassadonia |
|
4/19/2022 |
|
|
|
48,336 |
|
|
|
96,671 |
|
|
|
125.62 |
|
|
|
12,843,008 |
|
|
Alyssa Henry |
|
4/19/2022 |
|
|
|
48,336 |
|
|
|
96,671 |
|
|
|
125.62 |
|
|
|
12,843,008 |
|
|
Sivan Whiteley |
|
4/19/2022 |
|
|
|
29,422 |
|
|
|
58,843 |
|
|
|
125.62 |
|
|
|
7,817,479 |
|
|
|
|
Outstanding Equity Awards at 2022 Year-End
The following table lists all outstanding equity awards held by our named executive officers as of December 31, 2022. For additional information regarding the impact of certain employment termination scenarios on outstanding equity awards, refer to the section entitled “Potential Payments on Termination or Change of Control."
|
|
Option Awards |
|
|
Stock Awards |
|
||||||||||||||||||||||
Name |
|
Grant Date⁽¹⁾ |
|
|
Number of |
|
|
Number of |
|
|
Option |
|
|
Option |
|
|
Number of |
|
|
Market |
|
|||||||
Jack Dorsey |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Amrita Ahuja |
|
1/24/2019⁽⁴⁾ |
|
|
|
28,496 |
|
|
|
2,036 |
|
|
|
73.94 |
|
|
1/23/2029 |
|
|
|
— |
|
|
|
— |
|
||
|
|
1/24/2019⁽⁵⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
7,608 |
|
|
$ |
478,087 |
|
|
|
|
4/21/2020⁽⁶⁾ |
|
|
|
38,475 |
|
|
|
56,334 |
|
|
|
57.40 |
|
|
4/20/2030 |
|
|
|
— |
|
|
|
— |
|
||
|
|
4/21/2020⁽⁷⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
24,718 |
|
|
$ |
1,553,279 |
|
|
|
|
4/27/2021⁽⁶⁾ |
|
|
|
15,286 |
|
|
|
21,402 |
|
|
|
253.79 |
|
|
4/26/2031 |
|
|
|
— |
|
|
|
|
|||
|
|
4/27/2021⁽⁸⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
12,146 |
|
|
$ |
763,255 |
|
|
|
|
4/19/2022⁽⁶⁾ |
|
|
|
14,010 |
|
|
|
70,051 |
|
|
|
125.62 |
|
|
4/18/2032 |
|
|
|
— |
|
|
|
— |
|
||
|
|
4/19/2022⁽⁹⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
36,778 |
|
|
$ |
2,311,130 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Brian Grassadonia |
|
2/27/2014⁽¹⁰⁾ |
|
|
|
252,816 |
|
|
|
— |
|
|
|
7.25 |
|
|
2/27/2024 |
|
|
|
— |
|
|
|
— |
|
||
|
|
6/17/2015⁽¹⁰⁾ |
|
|
|
460,000 |
|
|
|
— |
|
|
|
13.94 |
|
|
6/16/2025 |
|
|
|
— |
|
|
|
— |
|
||
|
|
4/19/2017⁽⁶⁾ |
|
|
|
137,122 |
|
|
|
— |
|
|
|
17.20 |
|
|
4/18/2027 |
|
|
|
— |
|
|
|
— |
|
||
|
|
4/25/2018⁽¹¹⁾ |
|
|
|
109,026 |
|
|
|
— |
|
|
|
44.75 |
|
|
4/24/2028 |
|
|
|
— |
|
|
|
— |
|
||
|
|
4/24/2019⁽⁶⁾ |
|
|
|
90,955 |
|
|
|
8,269 |
|
|
|
71.99 |
|
|
4/23/2029 |
|
|
|
— |
|
|
|
— |
|
||
|
|
4/24/2019⁽¹²⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
4,962 |
|
|
$ |
311,812 |
|
|
|
|
4/21/2020⁽⁶⁾ |
|
|
|
112,667 |
|
|
|
56,334 |
|
|
|
57.40 |
|
|
4/20/2030 |
|
|
|
— |
|
|
|
— |
|
||
|
|
4/21/2020⁽⁷⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
24,718 |
|
|
$ |
1,553,279 |
|
|
|
|
4/27/2021⁽⁶⁾ |
|
|
|
15,286 |
|
|
|
21,402 |
|
|
|
253.79 |
|
|
4/26/2031 |
|
|
|
— |
|
|
|
— |
|
||
|
BLOCK 2023 Proxy Statement |
36 |
Table of Contents
|
|
Option Awards |
|
|
Stock Awards |
|
|||||||||||||||||||||
Name |
|
Grant Date⁽¹⁾ |
|
|
Number of |
|
|
Number of |
|
|
Option |
|
|
Option |
|
|
Number of |
|
|
Market |
|
||||||
|
|
4/27/2021⁽⁸⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
12,146 |
|
|
$ |
763,255 |
|
|
|
4/19/2022⁽⁶⁾ |
|
|
|
16,111 |
|
|
|
80,560 |
|
|
|
125.62 |
|
|
4/18/2032 |
|
|
|
— |
|
|
|
— |
|
|
|
|
4/19/2022⁽¹³⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
42,294 |
|
|
$ |
2,657,755 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Alyssa Henry |
|
5/14/2014⁽⁴⁾ |
|
|
|
553,842 |
|
|
|
— |
|
|
|
7.25 |
|
|
5/14/2024 |
|
|
|
— |
|
|
|
— |
|
|
|
|
4/19/2017⁽⁶⁾ |
|
|
|
15,683 |
|
|
|
— |
|
|
|
17.20 |
|
|
4/18/2027 |
|
|
|
— |
|
|
|
— |
|
|
|
|
4/25/2018⁽¹¹⁾ |
|
|
|
109,026 |
|
|
|
— |
|
|
|
44.75 |
|
|
4/24/2028 |
|
|
|
— |
|
|
|
— |
|
|
|
|
4/24/2019⁽⁶⁾ |
|
|
|
90,955 |
|
|
|
8,269 |
|
|
|
71.99 |
|
|
4/23/2029 |
|
|
|
— |
|
|
|
— |
|
|
|
|
4/24/2019⁽¹²⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
4,962 |
|
|
$ |
311,812 |
|
|
|
4/21/2020⁽⁶⁾ |
|
|
|
112,667 |
|
|
|
56,334 |
|
|
|
57.40 |
|
|
4/20/2030 |
|
|
|
— |
|
|
|
— |
|
|
|
|
4/21/2020⁽⁷⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
24,718 |
|
|
$ |
1,553,279 |
|
|
|
4/27/2021⁽⁶⁾ |
|
|
|
15,286 |
|
|
|
21,402 |
|
|
|
253.79 |
|
|
4/26/2031 |
|
|
|
— |
|
|
|
|
||
|
|
4/27/2021⁽⁸⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
12,146 |
|
|
$ |
763,255 |
|
|
|
4/19/2022⁽⁶⁾ |
|
|
|
16,111 |
|
|
|
80,560 |
|
|
|
125.62 |
|
|
4/18/2032 |
|
|
|
|
|
|
|
|||
|
|
4/19/2022⁽⁶⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
42,294 |
|
|
$ |
2,657,755 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Sivan Whiteley |
|
4/25/2018⁽¹¹⁾ |
|
|
|
47,699 |
|
|
|
— |
|
|
|
44.75 |
|
|
4/24/2028 |
|
|
|
— |
|
|
|
— |
|
|
|
|
4/24/2019⁽⁶⁾ |
|
|
|
60,636 |
|
|
|
5,513 |
|
|
|
71.99 |
|
|
4/23/2029 |
|
|
|
— |
|
|
|
— |
|
|
|
|
4/24/2019⁽¹⁴⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3,308 |
|
|
$ |
207,875 |
|
|
|
4/21/2020⁽⁶⁾ |
|
|
|
80,476 |
|
|
|
40,239 |
|
|
|
57.40 |
|
|
4/20/2030 |
|
|
|
— |
|
|
|
— |
|
|
|
|
4/21/2020⁽¹⁵⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
17,656 |
|
|
$ |
1,109,503 |
|
|
|
9/01/2020⁽⁶⁾ |
|
|
|
2,765 |
|
|
|
2,152 |
|
|
|
166.66 |
|
|
8/31/2030 |
|
|
|
— |
|
|
|
— |
|
|
|
|
9/01/2020⁽¹⁶⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,453 |
|
|
$ |
91,307 |
|
|
|
4/27/2021⁽⁶⁾ |
|
|
|
11,040 |
|
|
|
15,457 |
|
|
|
253.79 |
|
|
4/26/2031 |
|
|
|
— |
|
|
|
— |
|
|
|
|
4/27/2021⁽¹⁷⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8,772 |
|
|
$ |
551,232 |
|
|
|
4/19/2022⁽⁶⁾ |
|
|
|
9,807 |
|
|
|
49,036 |
|
|
|
125.62 |
|
|
4/18/2032 |
|
|
|
— |
|
|
|
— |
|
|
|
|
4/19/2022⁽¹⁸⁾ |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
25,745 |
|
|
$ |
1,617,816 |
|
|
|
|
BLOCK 2023 Proxy Statement |
37 |
Table of Contents
|
BLOCK 2023 Proxy Statement |
38 |
Table of Contents
Option Exercises and Stock Vested in 2022
The following table sets forth the number of shares of common stock acquired during 2022 by our named executive officers upon the exercise of stock options or upon the vesting of RSUs or RSAs, as well as the value realized upon such equity award transactions.
|
|
Option Awards |
|
|
Stock Awards |
|
||||||||||
Name |
|
Number of |
|
|
Value Realized |
|
|
Number of |
|
|
Value Realized |
|
||||
Jack Dorsey |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Amrita Ahuja |
|
|
8,130 |
|
|
|
249,835 |
|
|
|
57,019 |
|
|
|
5,289,417 |
|
Brian Grassadonia |
|
|
155,450 |
|
|
|
12,128,531 |
|
|
|
43,024 |
|
|
|
4,439,151 |
|
Alyssa Henry |
|
|
1,046,158 |
|
|
|
63,454,190 |
|
|
|
43,024 |
|
|
|
4,439,151 |
|
Sivan Whiteley |
|
|
17,292 |
|
|
|
1,439,061 |
|
|
|
31,852 |
|
|
|
3,231,033 |
|
|
|
Pension Benefits
Aside from our 401(k) Plan, we do not maintain any pension plan or arrangement under which our named executive officers are entitled to participate or receive post-retirement benefits.
Non-Qualified Deferred Compensation
We do not maintain any non-qualified deferred compensation plans or arrangements under which our named executive officers are entitled to participate.
Potential Payments on Termination or Change of Control
Each of our named executive officers was subject to a change of control and severance agreement during their employment with us in 2022. The terms of the change of control and severance agreements (the “COC agreements”) are described below, and key differences that apply to our Block Head are highlighted. Under the COC agreements, if, before a change of control, the Company decides to terminate a named executive officer’s employment with the Company without cause (excluding by reason of death or disability), the Company may make a written request that the named executive officer continue to remain employed with the Company or its subsidiaries for a specified transition period not to exceed 180 days from the date of the request (the “Transition Period”). During the Transition Period, the named executive officer will be expected to perform such transition and other duties as reasonably requested by the Company (or its subsidiaries) in its discretion. During the Transition Period, the named executive officer will continue to be paid their base salary, vest in their equity awards in accordance with their terms, and be eligible to participate in our bonus or commission plans (if any) and employee benefit plans, each in accordance with their terms. The Block Head’s change of control and severance agreement does not contain these Transition Period related terms.
|
BLOCK 2023 Proxy Statement |
39 |
Table of Contents
Under Ms. Ahuja’s COC agreement, if she remains employed by us or any of our subsidiaries through a “change in control” (as defined in our 2015 Plan), the vesting of any of her options that were outstanding when the original change of control and severance agreement was entered into will be accelerated upon the change in control as if she had been employed for an additional 12 months following such triggering event. If a change in control had occurred on December 31, 2022, Ms. Ahuja has one outstanding stock option award to which this would have applied. This option has an exercise price per share of $73.94 and therefore she would have realized no value from this acceleration feature, based on the closing price of our Class A common stock on December 30, 2022, which was $62.84.
If our named executive officer’s employment is terminated by us without “cause” or due to their death or “disability” (as such terms are defined in their change of control and severance agreement), in either case, outside the Change of Control Period (as defined below), and (ii) under the COC agreements (but not under the Block Head’s agreement) the named executive officer has completed any Transition Period requested by the company (excluding the named executive officers’ early cessation of any such Transition Period due to their death or disability, or the termination of the Transition Period by us other than for cause before its scheduled expiration) they will be eligible to receive these payments and benefits if they timely sign and do not revoke a release of claims:
If, (i) within the three-month period before a change of control until the end of the 12-month period following such change of control (such period, the “Change of Control Period”), our named executive officer’s employment is terminated by us without cause or due to their death or disability or our named executive officer resigns for “good reason” (as defined in their change of control and severance agreement), and (ii) (but not under the Block Head’s agreement), our named executive officer has completed any company-requested Transition Period (excluding our named executive officer’s early cessation of any such Transition Period due to their death or disability, or the company’s termination of the Transition Period other than for cause before its schedule expiration), our named executive officer will be entitled to these benefits if they timely sign and do not revoke a release of claims:
|
BLOCK 2023 Proxy Statement |
40 |
Table of Contents
In addition, if any of the payments or benefits provided for under the change of control and severance agreements or otherwise payable to our named executive officer would constitute “parachute payments” within the meaning of Section 280G of the Code and could be subject to the related excise tax, they would be entitled to receive either full payment of such payments and benefits or such lesser amount that would cause no portion of the payments and benefits being subject to the excise tax, whichever results in the greater after-tax benefits to our named executive officer. The change of control and severance agreements do not require us to provide any tax gross-up payments to our named executive officers.
|
BLOCK 2023 Proxy Statement |
41 |
Table of Contents
The following table summarizes the estimated payments and benefits that would be provided to our named executive officers upon termination and a change of control under our plans and arrangements with our named executive officers described above. For purposes of this table, for each named executive officer (other than Mr. Dorsey) the “Severance Period” defined above is assumed to last the maximum 180-day period.
|
|
Termination Without |
|
|
Termination |
|
|
Termination Without Cause or |
|
|||||||||||||||||||
Name |
|
Cash |
|
|
Health Care |
|
|
Acceleration |
|
|
Acceleration |
|
|
Cash |
|
|
Health |
|
|
Acceleration |
|
|||||||
Jack Dorsey |
|
|
2.06 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2.75 |
|
|
|
— |
|
|
|
— |
|
Amrita Ahuja |
|
|
262,500 |
|
|
|
15,979 |
|
|
|
1,593,545 |
|
|
|
5,412,207 |
|
|
|
525,000 |
|
|
|
31,958 |
|
|
|
5,412,207 |
|
Brian Grassadonia |
|
|
262,500 |
|
|
|
15,536 |
|
|
|
1,476,788 |
|
|
|
5,592,558 |
|
|
|
525,000 |
|
|
|
31,072 |
|
|
|
5,592,558 |
|
Alyssa Henry |
|
|
262,500 |
|
|
|
15,536 |
|
|
|
1,476,788 |
|
|
|
5,592,558 |
|
|
|
525,000 |
|
|
|
31,072 |
|
|
|
5,592,558 |
|
Sivan Whiteley⁽⁹⁾ |
|
|
262,500 |
|
|
|
12,890 |
|
|
|
1,027,203 |
|
|
|
3,796,633 |
|
|
|
525,000 |
|
|
|
25,780 |
|
|
|
3,796,633 |
|
|
|
|
BLOCK 2023 Proxy Statement |
42 |
Table of Contents
|
EQUITY COMPENSATION PLAN INFORMATION |
|
The following table summarizes our equity compensation plan information as of December 31, 2022. Information is included for equity compensation plans approved by our stockholders. We do not have any equity compensation plans not approved by our stockholders.
|
|
|
|
|
(a) |
|
|
(b) |
|
|
(c) |
|
|
||||
Plan Category |
|
Class of Common |
|
|
Number of |
|
|
Weighted |
|
|
Number of |
|
|
||||
Equity compensation plans approved by stockholders |
|
Class A⁽²⁾ |
|
|
|
31,277,119 |
|
|
$ |
77.19 |
|
|
142942274⁽³⁾ |
|
|
||
|
|
Class B⁽⁴⁾ |
|
|
|
3,730,601 |
|
|
$ |
10.69 |
|
|
|
— |
|
|
|
Equity compensation plans not approved by stockholders |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Total |
|
Class A and Class B |
|
|
|
35,007,720 |
|
|
$ |
40.37 |
|
|
|
142,942,274 |
|
|
|
|
|
|
BLOCK 2023 Proxy Statement |
43 |
Table of Contents
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT |
|
The following table sets forth certain information with respect to the beneficial ownership of our common stock as of March 31, 2023, for:
We have determined beneficial ownership in accordance with the rules of the SEC, and thus it represents sole or shared voting or investment power with respect to our securities. Unless otherwise indicated below, to our knowledge, the persons and entities named in the table have sole voting and sole investment power with respect to all shares that they beneficially owned, subject to community property laws where applicable.
We have based our calculation of the percentage of beneficial ownership on 542,757,039 shares of our Class A common stock and 60,635,933 shares of our Class B common stock outstanding as of March 31, 2023. We have deemed shares of our common stock subject to stock options that are currently exercisable or exercisable within 60 days of March 31, 2023, or issuable pursuant to RSUs that are subject to vesting conditions expected to occur within 60 days of March 31, 2023 to be outstanding and to be beneficially owned by the person holding the stock option or RSU for the purpose of computing the percentage ownership of that person. We did not deem these shares outstanding, however, for the purpose of computing the percentage ownership of any other person.
Unless otherwise indicated, the address of each beneficial owner listed in the table below is c/o Block, Inc., 1955 Broadway, Suite 600, Oakland, California 94612. The information provided in the table is based on our records, information filed with the SEC and information provided to us, except where otherwise noted.
|
|
Class A Common Stock |
|
|
Class B Common Stock+ |
|
|
|
|
|||||||||||
Name of Beneficial Owner |
|
Number |
|
|
Percent |
|
|
Number |
|
|
Percent |
|
|
Percent of |
|
|||||
5% Stock Holders: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
The Vanguard Group⁽¹⁾ |
|
|
35,515,147 |
|
|
|
6.5 |
% |
|
|
— |
|
|
* |
|
|
|
3.1 |
% |
|
Named Executive Officers and Directors: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Jack Dorsey⁽²⁾ |
|
|
1,000,000 |
|
|
* |
|
|
|
47,844,566 |
|
|
|
78.9 |
% |
|
|
41.7 |
% |
|
Amrita Ahuja⁽³⁾ |
|
|
206,249 |
|
|
* |
|
|
|
— |
|
|
* |
|
|
* |
|
|||
Brian Grassadonia⁽⁴⁾ |
|
|
692,916 |
|
|
* |
|
|
|
712,816 |
|
|
|
1.2 |
% |
|
* |
|
||
Alyssa Henry⁽⁵⁾ |
|
|
755,712 |
|
|
* |
|
|
|
153,845 |
|
|
* |
|
|
* |
|
|||
Sivan Whiteley⁽⁶⁾ |
|
|
303,138 |
|
|
* |
|
|
|
— |
|
|
* |
|
|
* |
|
|||
Roelof Botha⁽⁷⁾ |
|
|
713,608 |
|
|
* |
|
|
|
— |
|
|
* |
|
|
* |
|
|||
Amy Brooks⁽⁸⁾ |
|
|
7,945 |
|
|
* |
|
|
|
— |
|
|
* |
|
|
* |
|
|||
Shawn Carter⁽⁹⁾ |
|
|
33,279 |
|
|
* |
|
|
|
— |
|
|
* |
|
|
* |
|
|||
Paul Deighton⁽¹⁰⁾ |
|
|
31,282 |
|
|
* |
|
|
|
— |
|
|
* |
|
|
* |
|
|||
Randall Garutti⁽¹¹⁾ |
|
|
19,698 |
|
|
* |
|
|
|
— |
|
|
* |
|
|
* |
|
|||
James McKelvey⁽¹²⁾ |
|
|
126,733 |
|
|
* |
|
|
|
12,259,025 |
|
|
|
20.2 |
% |
|
|
10.7 |
% |
|
Mary Meeker⁽¹³⁾ |
|
|
408,139 |
|
|
* |
|
|
|
— |
|
|
* |
|
|
* |
|
|||
Sharon Rothstein⁽¹⁴⁾ |
|
|
1,937 |
|
|
* |
|
|
|
— |
|
|
* |
|
|
* |
|
|||
Lawrence Summers⁽¹⁵⁾ |
|
|
21,656 |
|
|
* |
|
|
|
67,380 |
|
|
* |
|
|
* |
|
|||
Darren Walker⁽¹⁶⁾ |
|
|
4,677 |
|
|
* |
|
|
|
— |
|
|
* |
|
|
* |
|
|||
All current executive officers and directors as a group (15 persons)⁽¹⁷⁾ |
|
|
4,059,441 |
|
|
|
0.8 |
% |
|
|
61,075,197 |
|
|
|
99.2 |
% |
|
|
53.0 |
% |
|
BLOCK 2023 Proxy Statement |
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* Represents beneficial ownership of less than one percent (1%) of the outstanding shares of our common stock.
+ The Class B common stock is convertible at any time by the holder into shares of Class A common stock on a share-for-share basis, such that each holder of Class B common stock beneficially owns an equivalent number of Class A common stock.
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PAY VERSUS PERFORMANCE |
As required by Item 402(v) of Regulation S-K, we are providing the following information regarding the relationship between executive compensation and our financial performance for each of the last three completed calendar years. In determining the “compensation actually paid” to our named executive officers, we are required to make various adjustments to amounts that have been reported in our Summary Compensation Table (“SCT”), as the SEC’s valuation methods for this section differ from those required in our SCT. The table below summarizes compensation values reported in our SCT, as well as the adjusted values required in this section for the applicable years presented. For our named executive officers other than our PEO (“non-PEO NEOs”), compensation is reported as an average of compensation for our non-PEO NEOs.
The primary objective of our executive compensation program is to drive long-term stockholder value. Compensation for our NEOs is heavily weighted toward equity-based compensation, which is directly tied to our long-term value and growth, and aligns the interests of our executives with our stockholders. For additional information regarding our compensation philosophy, please refer to the section entitled “Compensation Discussion & Analysis.”
In 2022, we did not use any financial performance measures to link compensation “actually paid” to company performance in a manner that can act as a “Company-Selected Measure” under the relevant rules. As such, we do not have a “Company-Selected Measure.” We therefore do not provide a tabular list of such performance measures.
Pay Versus Performance Table
Year (a) |
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Summary compensation table total for PEO ($) (b)(1) |
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Compensation actually paid to PEO ($) (c)(1) |
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Average summary compensation table total for Non-PEO NEOs ($) (d)(2) |
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Average compensation actually paid to Non-PEO NEOs ($) (e)(2)(3)(4)(5)(6) |
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Value of initial fixed $100 investment based on: |
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Net Income (Loss) ($1000s) (h)(9) |
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Total shareholder return ($) (f)(7) |
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Peer group total shareholder return ($) (g)(7)(8) |
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2022 |
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( |
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( |
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2021 |
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( |
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2020 |
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2020 |
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2021 |
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2022 |
Total Average Compensation to non-PEO NEOs per SCT ($) |
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Less: Amounts reported in SCT as equity award amounts, which are based on grant date fair values |
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( |
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( |
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( |
Plus: Year-end fair value of any equity awards granted in the covered fiscal year that were outstanding and unvested as of the end of the covered fiscal year |
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Plus: Change in fair value as of the end of the covered fiscal year (from the end of the prior fiscal year) of any equity awards granted in prior years that were outstanding and unvested as of the end of the covered fiscal year. |
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( |
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( |
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Plus: Vesting date fair value of any equity awards that were granted and vested in the same covered fiscal year |
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Plus: Change in fair value from the end of the prior fiscal year to the vesting date for awards granted in prior years that vest in the covered fiscal year |
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( |
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Less: Fair value at the end of the prior fiscal year for awards granted in prior years that were forfeited during the covered fiscal year |
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( |
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Total Adjustments |
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( |
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( |
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Total Average CAP to non-PEO NEOs for Fiscal Year |
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( |
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( |
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Relationship Between Compensation Actually Paid, Block Total Shareholder Return and Peer Group Total Shareholder Return
Relationship Between Compensation Actually Paid and Net Income (Loss)
Block TSR is calculated based on an assumed investment of $100 on December 31, 2019.
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PAY RATIO DISCLOSURE |
As required by Section 953(b) of the Dodd-Frank Act and Item 402(u) of Regulation S-K, we are providing the following information about the relationship of the annual total compensation of our employees and the annual total compensation of Mr. Dorsey, our Block Head.
For 2022, our last completed fiscal year:
Based on this information, for 2022, the annual total compensation of our Block Head was less than 0.0001 times that of the median of the annual total compensation for all employees. This pay ratio is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K.
To identify the median of the annual total compensation of all our employees, as well as to determine the annual total compensation of our median employee and our Block Head, we took the following steps:
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CERTAIN RELATIONSHIPS, RELATED PARTY AND OTHER TRANSACTIONS |
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We describe below transactions and series of similar transactions, since the beginning of our last fiscal year, to which we were a participant or will be a participant, in which:
Our audit and risk committee reviewed and approved each of the transactions described below pursuant to our related person transactions policy. All dollar amounts are as of March 31, 2023.
We engage Twitter, Inc. (“Twitter”) to provide certain marketing and advertising services (the “Twitter Services”). We purchased approximately $0.8 million of marketing and advertising services from Twitter, including direct purchases and purchases through third-party agencies, from January through May 2022.
Jack Dorsey, our Block Head and the Chairperson of our board of directors, served as the Chief Executive Officer of Twitter until November 2021 and served as a director of Twitter until May 2022. As a result, Mr. Dorsey may be deemed to have an indirect material interest in the Twitter Services.
Shake Shack
We are party to an amended and restated enterprise services agreement and a Cash App boost agreement with Shake Shack Enterprises, LLC, a subsidiary of Shake Shack Inc. (“Shake Shack”), pursuant to which we provide certain products and services related to payment processing, software as a service, hardware and instant rewards (collectively, the “Shake Shack Services”). Since January 1, 2022, we have received approximately $5.9 million, in revenue from the Shake Shack Services and Cash Boosts partnership.
Additionally, a subsidiary of Shake Shack was sued in federal court for allegedly infringing a patent owned by Electronic Receipts Delivery Systems, LLC (“ERDS”) because of its use of one of our applications to send out digital receipts. Because Shake Shack was sued for allegedly using one of our products, in 2020 we agreed to defend Shake Shack against ERDS and to indemnify Shake Shack for any liabilities or expenses it incurs as a result of the lawsuit to the extent that the claims are being directed at our products or services (the “Shake Shack Indemnification,” and together with the “Shake Shack Services,” the “Shake Shack Transactions”). The lawsuit was dismissed in February 2022. Except for attorney fees, during the fiscal year ended December 31, 2022, we did not make any payments in connection with the Shake Shack Indemnification. We paid approximately $0.2 million over the life of the lawsuit in attorney fees on behalf of Shake Shack.
Randy Garutti, a member of our board of directors, is a director and Chief Executive Officer of Shake Shack. As a result, Mr. Garutti may be deemed to have an indirect material interest in the Shake Shack Transactions.
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St. Louis Lease
In July 2019, we entered into a lease agreement with 900 N. Tucker Building, LLC (“900 N. Tucker”) for a 15.5-year lease of office space in St. Louis, Missouri (the “St. Louis Lease”). We began occupying the office space in July 2021. During the year ended December 31, 2022, we made approximately $3.7 million in payments in connection with the St. Louis Lease. During the fiscal year ending December 31, 2023, we expect to make monthly lease payments in accordance with the terms of the St. Louis Lease, as well as associated costs such as parking fees, management fees and annual direct expenses (e.g., operating and tax expenses). We expect these lease payments will be offset, in part, by tenant improvement allowances under the terms of the St. Louis Lease.
On January 2, 2023, pursuant to the terms of the St. Louis Lease, we sent notice to the landlord that, beginning January 1, 2024, we will reduce the total rental square footage of the St. Louis Lease by approximately 48%. We expect the lease payments to be reduced in proportion to the square footage returned to the landlord. In February 2023, we paid a termination penalty of approximately $5.2 million to exercise this early termination option.
Jim McKelvey, our co-founder and a member of our board of directors, is affiliated with 900 N. Tucker. As a result, Mr. McKelvey may be deemed to have an indirect material interest in the St. Louis Lease.
Roc Nation
We engage Roc Nation LLC (“Roc Nation”) to provide certain artist, marketing and concert services (the “Roc Nation Services”). Since January 1, 2022, we have made approximately $0.3 million in payments to Roc Nation in connection with the Roc Nation Services.
Mr. Carter has an ownership interest in Roc Nation and is its co-founder. As a result, Mr. Carter may be deemed to have an indirect material interest in the Roc Nation Services.
Bitcoin Academy
In June 2022, we entered into a partnership with the Marcy Houses, a public housting complex in Brooklyn, New York operated by the New York City Housing Authority, to create the Bitcoin Academy, a project personally funded by Messrs. Carter and Dorsey. The Bitcoin Academy aims to increase bitcoin and financial literacy and access for historically under-resourced communities, starting with residents of the Marcy Houses, where Mr. Carter grew up. Pursuant to such partnership, we agreed to provide certain monetary and equipment support and services for the Bitcoin Academy (the “Bitcoin Academy Services”). Since January 1, 2022, we have provided approximately $0.7 million in monetary support and services towards the Bitcoin Academy.
Given Messrs. Carter and Dorsey personally funded the Bitcoin Academy, both may be deemed to have an indirect material interest in the Bitcoin Academy Services.
SubX
We engaged SubX Live, Inc., a software development company (“SubX”) to perform certain SaaS services relating to the development and customization of trivia platform experience for Cash App (the
“SubX Services”). Since January 1, 2022, we have incurred payment obligations of approximately $0.3 million in connection with the SubX Services.
Harpreet Marwaha, the chief executive officer and majority shareholder of SubX, is the spouse of Amrita Ahuja, our Chief Operating Officer and Chief Financial Officer. As a result, Ms. Ahuja may be deemed to have an indirect material interest in the SubX Services.
Other Transactions
We have entered into change of control and severance agreements with our current executive officers that, among other matters, provide for certain severance and change of control benefits. For additional information, refer to the section entitled “Executive Compensation—Potential Payments on Termination or Change of Control.”
We have entered into indemnification agreements with our directors and executive officers. The indemnification agreements, our amended and restated certificate of incorporation, and amended and
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restated bylaws require us to indemnify our directors and executive officers to the fullest extent permitted by Delaware law.
A family member of Brian Grassadonia, our Cash App CEO, is employed by us in a non-executive position. The approximate dollar value of the employee’s total cash and equity compensation for the year ended December 31, 2022 was less than $280,000. The family member also receives benefits consistent with other employees serving in the same capacity.
Other than as described above, since January 1, 2022, we have not entered into any transactions, nor are there any currently proposed transactions, between us and a related party where the amount involved exceeds, or would exceed, $120,000, and in which any related person had or will have a direct or indirect material interest.
Policies and Procedures for Related Party Transactions
Our audit and risk committee has the primary responsibility for reviewing and approving or disapproving “related party transactions,” which are transactions between us and related persons in which the aggregate amount involved exceeds or may be expected to exceed $120,000 and in which a related person has or will have a direct or indirect material interest. The charter of our audit and risk committee provides that our audit and risk committee shall review and approve any related party transaction for which review or oversight is required by applicable law or that is required to be disclosed in our financial statements or SEC filings.
We have a formal written policy providing that our audit and risk committee must pre-approve any transaction that exceeds $120,000 and in which any related person has a direct or indirect material interest. In approving or rejecting any such transaction, our audit and risk committee is to consider the relevant facts and circumstances available and deemed relevant to our audit and risk committee, including, but not limited to, whether the transaction is on terms no less favorable than terms generally available to an unaffiliated third party under the same or similar circumstances, whether such transaction would impair the independence of an outside director, whether such transaction would present an improper conflict of interest for any director or executive officer of our company, whether the transaction is part of the ordinary course of business and the extent of the related person’s interest in the transaction. Any member of the audit and risk committee who has an interest in a potential related party transaction under discussion will abstain from voting on the approval of such transaction. If a related party transaction will be ongoing, the audit and risk committee may establish guidelines for us to follow in our ongoing dealings with the related party.
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QUESTIONS AND ANSWERS ABOUT OUR PROXY MATERIALS AND THE ANNUAL MEETING |
This proxy statement and the enclosed form of proxy are furnished in connection with the solicitation of proxies by our board of directors for use at the Annual Meeting. The Annual Meeting will be held on Tuesday, June 13, 2023, at 10:00 a.m. (U.S. Pacific Time) as a completely virtual meeting. Stockholders can attend the Annual Meeting by visiting www.virtualshareholdermeeting.com/SQ2023, where you will be able to listen to the meeting live, submit questions and vote your shares online during the meeting. CDI holders can attend the Annual Meeting by visiting www.virtualshareholdermeeting.com/SQ2023 as a guest, where you will be able to listen to the meeting live. The Notice of Internet Availability of Proxy Materials (the “Notice”) containing instructions on how to access this proxy statement and our annual report is first being mailed on or about April 28, 2023 (U.S. Eastern Time), to all stockholders entitled to vote at the Annual Meeting, and the CDI Notice of Access Letter is being mailed or emailed from Australia to CDI holders on or about April 29, 2023 (Australia time).
The information provided in the “question and answer” format below is for your convenience only and is merely a summary of the information contained in this proxy statement. You should read this entire proxy statement carefully. Information contained on or accessible through our website is not incorporated by reference in this proxy statement, and references to our website address in this proxy statement are inactive textual references only.
What matters am I voting on?
You will be voting on:
How does the board of directors recommend I vote on these proposals?
Our board of directors recommends a vote:
Who is entitled to vote?
Holders of our Class A common stock and holders of our Class B common stock as of the close of business on April 20, 2023 (U.S. Eastern Time), the record date for the Annual Meeting, may vote at the Annual Meeting. Shares of our Class A common stock also trade on the Australian Stock Exchange (“ASX”) in the form of CDIs. Holders of our CDIs as of the close of business on April 20, 2023 (U.S. Eastern Time), may attend the Annual Meeting as guests but cannot vote at the Annual Meeting; instead, CDI holders must vote the Class A common stock underlying their CDIs before 11:59 p.m. (Australian Eastern Standard Time) on Wednesday, June 7, 2023. Each CDI represents a beneficial interest in one share of our Class A common stock. As of the record date, there were 544,187,638 shares of our Class A common stock outstanding (including 29,738,908 CDIs exchangeable into shares of our Class A common stock) and
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60,635,933 shares of our Class B common stock outstanding. Our Class A common stock and Class B common stock will vote as a single class on all matters described in this proxy statement for which your vote is being solicited. Stockholders are not permitted to cumulate votes with respect to the election of directors. Each share of Class A common stock is entitled to one vote on each proposal, and each share of Class B common stock is entitled to 10 votes on each proposal. Our Class A common stock and Class B common stock are collectively referred to in this proxy statement as our “common stock.”
Registered Stockholders. If shares of our common stock are registered directly in your name with our transfer agent, you are considered the stockholder of record with respect to those shares, and the Notice was provided to you directly by us. As the stockholder of record, you have the right to grant your voting proxy directly to the individuals listed on the proxy card or to vote live at the Annual Meeting. Throughout this proxy statement, we refer to registered stockholders as “stockholders of record.”
Street Name Stockholders. If shares of our common stock are held on your behalf in a brokerage account or by a bank or other nominee, you are considered to be the beneficial owner of shares that are held in “street name,” and the Notice was forwarded to you by your broker, bank or other nominee, who is considered to be the stockholder of record with respect to those shares. As the beneficial owner, you have the right to direct your broker, bank or other nominee as to how to vote your shares. You are also invited to attend the Annual Meeting; however, because you are not the stockholder of record, you cannot vote your shares at the Annual Meeting unless you first request and obtain a valid proxy from your broker, bank or other nominee. Throughout this proxy statement, we refer to stockholders who hold their shares through a broker, bank or other nominee as “street name stockholders” or “beneficial owners.”
CDI Holders. If you own our CDIs, then you are the beneficial owner of one share of our Class A common stock for every CDI you own. Legal title is held by our CDI Depositary, CHESS Depositary Nominees Pty Ltd, or CDN. CDN is considered the stockholder of record for purposes of voting at the Annual Meeting. As the beneficial owner, you have the right to direct CDN as to how to vote your shares. You are also invited to attend the Annual Meeting; however, because you are not a stockholder of record, you cannot vote the shares underlying your CDIs at the Annual Meeting. We encourage you to direct CDN to lodge your votes online prior to the Annual Meeting by using the details on your Notice of Access Letter to request that Computershare Australia send you a hard copy of the CDI voting form to their registered address, or by lodging your votes through our online voting site at www.investorvote.com.au before 11:59 p.m. (Australian Eastern Standard Time) on Wednesday, June 7, 2023.
How many votes are needed for approval of each proposal?
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The proposal to approve the compensation of our executives and the stockholder proposal regarding our diversity and inclusion disclosure are advisory votes, meaning the results will not be binding on our board of directors, our compensation committee or the Company. However, our board of directors and our compensation committee will consider the outcome of the vote on executive compensation when determining named executive officer compensation. In addition, the board of directors will take into account the outcome of the vote regarding the stockholder proposal.
What is a quorum?
A quorum is the minimum number of shares required to be present at the Annual Meeting to properly hold an annual meeting of our stockholders and conduct business under our amended and restated bylaws and Delaware law. The presence, virtually or by proxy, of a majority of the voting power 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 at the Annual Meeting.
How do I vote?
If you are a stockholder of record, there are four ways to vote:
Even if you plan to attend the Annual Meeting, we recommend that you also vote by proxy so that your vote will be counted if you later decide not to attend the Annual Meeting.
If you are a street name stockholder, you will receive voting instructions from your broker, bank or other nominee. You must follow the voting instructions provided by your broker, bank or other nominee in order to direct your broker, bank or other nominee on how to vote your shares. Street name stockholders should generally be able to vote in advance of the Annual Meeting by returning a voting instruction form and may be able to vote by telephone or on the Internet, depending on the voting process of your broker, bank or other nominee. As discussed above, if you are a street name stockholder, you may not vote your shares live at the virtual Annual Meeting unless you obtain a legal proxy from your broker, bank or other nominee.
If you are a CDI holder, you may instruct CDN to vote the Class A common stock underlying your CDIs on your behalf by using the details on the Notice of Access Letter to request that Computershare Australia send a hard copy of the CDI voting form in the mail to your registered address, or you may lodge your votes through our online voting site at www.investorvote.com.au before 11:59 p.m. (Australian Eastern Standard Time) on Wednesday, June 7, 2023.
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Can I change my vote or revoke my proxy?
Yes. If you are a stockholder of record, you can change your vote or revoke your proxy any time before the Annual Meeting by:
If you are a street name stockholder, your broker, bank or other nominee can provide you with instructions on how to change or revoke your vote.
If you own CDIs, you can change or revoke your vote by visiting our online voting site at www.investorvote.com.au before 11:59 p.m. (Australian Eastern Standard Time) on Wednesday, June 7, 2023.
What do I need to do to attend and participate in the Annual Meeting?
All holders of our common stock and all holders of our CDIs as of the record date will be able to attend the Annual Meeting by visiting www.virtualshareholdermeeting.com/SQ2023 and entering the 16-digit control number included on the Notice, proxy card or voting instruction form; however, only stockholders of record and street name stockholders with a legal proxy from their broker, bank or other nominee will be able to submit questions during the meeting, with a limit of one question per stockholder, and vote shares electronically at the meeting. CDI holders can visit our online voting site at www.investorvote.com.au and submit a question before 11:59 p.m. (Australian Eastern Standard Time) on Wednesday, June 7, 2023. We will answer as many questions submitted in accordance with the meeting rules of conduct as possible in the time allotted for the meeting. Only questions that are relevant to our business operations will be answered.
The Annual Meeting webcast will begin promptly at 10:00 a.m. (U.S. Pacific Time). We encourage you to access the meeting prior to the start time. Online check-in will begin at 9:45 a.m. (U.S. Pacific Time), and you should allow ample time for the check-in procedures.
What if during the check-in time or during the meeting I have technical difficulties or trouble accessing the virtual meeting website?
We will have technicians to assist you if you experience technical difficulties accessing the Annual Meeting. If you encounter any difficulties accessing the meeting during the check-in or meeting time, please call 844-986-0822 (domestic) or 303-562-9302 (international).
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What is the effect of giving a proxy?
Proxies are solicited by and on behalf of our board of directors. Jack Dorsey, Amrita Ahuja and Chrysty Esperanza have been designated as proxy holders by our board of directors. When proxies are properly dated, executed and returned, the shares represented by such proxies will be voted at the Annual Meeting in accordance with the instructions of the stockholder. If no specific instructions are given, however, the shares will be voted in accordance with the recommendations of our board of directors as set forth above. If any matters not described in this proxy statement are properly presented at the Annual Meeting pursuant to our amended and restated bylaws, the proxy holders will use their own judgment to determine how to vote the shares. If the Annual Meeting is adjourned or postponed, the proxy holders can vote the shares on the new Annual Meeting date unless you have properly revoked your proxy instructions, as described above.
Why did I receive a Notice of Internet Availability of Proxy Materials instead of a full set of proxy materials?
In accordance with the rules of the SEC, we have elected to furnish our proxy materials, including this proxy statement and our annual report, primarily via the Internet. The Notice, which contains instructions on how to access our proxy materials via the Internet, is first being mailed on or about April 28, 2023 (U.S. Eastern Time), to all of our stockholders of record. Stockholders in street name will receive the Notice from their broker, bank or other nominee. All stockholders will have the ability to access the proxy materials on the website referred to in the Notice (www.proxyvote.com). Stockholders may also request to receive proxy materials for this Annual Meeting or future meetings of our stockholders in printed form by mail or electronically by email 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 and cost of our annual meetings of stockholders.
Why did I receive a Notice of Access Letter instead of a full set of proxy materials?
Holders of our CDIs, which are listed on the ASX, will receive a Notice of Access Letter from Computershare Australia. If you received the Notice of Access Letter by electronic mail, you will not automatically receive a printed copy of the proxy materials in the mail. The Notice of Access Letter tells you how to use the Internet to access and review this proxy statement and our annual report, and how you may submit your proxy via the Internet or request a hard copy of the CDI voting form to be sent in the mail to your registered address.
How are proxies solicited for the Annual Meeting?
Our board of directors is soliciting proxies for the Annual Meeting. We will bear the entire cost of proxy solicitation, including the preparation, assembly, printing, mailing and distribution of our proxy materials. 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 of our common stock that are held of record by such brokers, banks, or other nominees. The original solicitation of proxies may be supplemented by solicitation by telephone, electronic communications, or other means by our directors, officers or employees. No additional compensation will be paid to these individuals for any such services, although we may reimburse such individuals for their reasonable out-of-pocket expenses in connection with such solicitation.
How may my brokerage firm or other intermediary vote my shares if I fail to provide timely directions?
Brokerage firms and other intermediaries holding shares of our common stock in street name for beneficial owners are generally required to vote such shares in the manner directed by such beneficial owners. In the absence of timely directions, your broker or other intermediary will have discretion to vote your shares on our sole “routine” matter, which is the proposal to ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for our fiscal year ending December 31, 2023. Your broker or other intermediary will not have discretion to vote on any other proposals, which are all “non-routine” matters, absent direction from you. We refer to the absence of a vote on a non-routine proposal for which a broker has not received instructions as a “broker non-vote.”
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Why is the Annual Meeting being conducted as a virtual meeting?
The Annual Meeting will again be a completely virtual meeting of stockholders, which we believe provides the opportunity for participation by a broader group of stockholders while reducing the environmental impact and the costs associated with in-person meetings. We designed the format of the virtual Annual Meeting to ensure that our stockholders are afforded the same rights and opportunities to participate as they would have at an in-person meeting and to enhance stockholder access, participation and communication through online tools. The virtual format facilitates stockholder attendance and participation by enabling stockholders to participate from any location around the world.
Where can I find the voting results of the Annual Meeting?
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 instead file a Current Report on Form 8-K with the preliminary results within four business days after the Annual Meeting and an amendment to the Current Report on Form 8-K with the final results as soon as such final results become available.
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?
We have adopted a procedure, which the SEC has approved, called “householding.” Under this procedure, we deliver a single copy of the Notice and, if applicable, our proxy materials to multiple stockholders who share the same address, unless we have received contrary instructions from one or more of such stockholders. Applicable stockholders who have not provided instructions against householding will continue to receive the Notice and, if applicable, our proxy materials in this manner in subsequent years until they are notified otherwise or until they revoke their consent. This procedure reduces our printing and mailing costs and fees. Stockholders who participate in householding will continue to be able to access and receive separate proxy cards.
Upon the written or oral request of a stockholder of record, we will promptly deliver a separate copy of the Notice and, if applicable, our proxy materials to such stockholder at the shared address to which we delivered a single copy of any of these materials. To receive a separate copy, or, if a stockholder of record 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 Broadridge Financial Solutions, Inc. (“Broadridge”):
Additionally, stockholders of record who share the same address and receive multiple copies of the Notice can request a single Notice by contacting Broadridge at the address, email address or telephone number above.
Street name stockholders may contact their broker, bank or other nominee to request information about householding.
If you are a CDI holder, you will receive your Notice of Access Letter from Computershare Australia. If you received the Notice of Access Letter by electronic mail or mail, you will not automatically receive a printed copy of the proxy materials in the mail. Multiple CDI holders who share the same address will receive their own copy of the Notice of Access Letter so long as each CDI holder is registered separately on the register or with the ASX.
What is the deadline to propose actions for consideration or to nominate individuals to serve as directors at next year’s annual meeting of stockholders?
Stockholder Proposals
Stockholders may present proper proposals for inclusion in our proxy statement and for consideration at our 2024 annual meeting of stockholders by submitting their proposals in writing to our Corporate Secretary in a timely manner. For a stockholder proposal to be considered for inclusion in our proxy statement for our 2024 annual meeting of stockholders, our Corporate Secretary must receive the written
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proposal at the address below not later than December 30, 2023 (U.S. Eastern Time). In addition, stockholder proposals must comply with the requirements of Rule 14a-8 of the Exchange Act regarding the inclusion of stockholder proposals in company-sponsored proxy materials. Stockholder proposals should be addressed to:
Block, Inc.
Attention: Corporate Secretary
1955 Broadway, Suite 600
Oakland, California 94612
Our amended and restated bylaws also establish an advance notice procedure for stockholders who wish to present a proposal before an annual meeting of stockholders but do not intend for the proposal to be included in our proxy statement. Our amended and restated bylaws provide that the only business that may be conducted at an annual meeting of stockholders is business that is (i) specified in our proxy materials with respect to such annual meeting, (ii) otherwise properly brought before such annual meeting by or at the direction of our board of directors, or (iii) properly brought before such annual meeting by a stockholder of record entitled to vote at such annual meeting who has delivered timely written notice to our Corporate Secretary, which notice must contain the information specified in our amended and restated bylaws. To be timely for our 2024 annual meeting of stockholders, our Corporate Secretary must receive the written notice at the address above:
In the event that we hold our 2024 annual meeting of stockholders more than 30 days before or more than 60 days after the one-year anniversary of the Annual Meeting, notice of a stockholder proposal that is not intended to be included in our proxy statement must be received no earlier than the close of business on the 120th day before the first anniversary of the Annual Meeting and no later than the close of business on the later of the following two dates:
If a stockholder who has properly notified us of their or its intention to present a proposal at an annual meeting of stockholders does not appear to present their or its proposal at such annual meeting, we are not required to present the proposal for a vote at such annual meeting.
Nomination of Director Candidates
Our amended and restated bylaws permit stockholders to nominate directors for election at an annual meeting of stockholders. To nominate a director, the stockholder must provide the information required by our amended and restated bylaws. Any notice of director nomination submitted must include the additional information required by Rule 14a-19(b) under the Exchange Act. In addition, the stockholder must give timely notice to our Corporate Secretary in accordance with our amended and restated bylaws, which, in general, require that such notice be received by our Corporate Secretary within the time periods described above under the section entitled “Stockholder Proposals” for stockholder proposals that are not intended to be included in a proxy statement.
Availability of Bylaws
A copy of our amended and restated bylaws is available on our website at https://investors.block.xyz and via the SEC’s website at https://www.sec.gov. Information contained on or accessible through our website is not incorporated by reference in this proxy statement. You may also contact our Corporate Secretary at the address set forth above for a copy of the relevant bylaw provisions regarding the requirements for making stockholder proposals and nominating director candidates.
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OTHER MATTERS |
Delinquent Section 16(a) Reports
Section 16(a) of the Exchange Act requires that our executive officers and directors, and persons who own more than 10% of our common stock, file reports of ownership and changes of ownership with the SEC. Such directors, executive officers and 10% stockholders are required by SEC regulation to furnish us with copies of all Section 16(a) forms they file.
SEC regulations require us to identify in this proxy statement anyone who filed a required report late during the most recent fiscal year. Based on our review of forms we received, or written representations from reporting persons stating that they were not required to file these forms, we believe that during our fiscal year ended December 31, 2022, all Section 16(a) filing requirements were satisfied on a timely basis, except with respect to a Form 4 reporting two transactions by each of Amrita Ahuja, Ajmere Dale, Brian Grassadonia, Alyssa Henry and Sivan Whiteley that were not timely filed.
Fiscal Year 2022 Annual Report and SEC Filings
Our financial statements for our fiscal year ended December 31, 2022, are included in our Annual Report on Form 10-K, which we will make available to stockholders along with this proxy statement. This proxy statement and our annual report are posted on our website at https://investors.block.xyz and are available from the SEC at its website at https://www.sec.gov. You may also obtain a copy of our annual report without charge by sending a written request to Block, Inc., Attention: Investor Relations, 1955 Broadway, Suite 600, Oakland, CA 94612.
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The board of directors does not know of any other matters to be presented at the Annual Meeting. If any additional matters are properly presented at the Annual Meeting, the persons named in the enclosed proxy card will have discretion to vote the shares of our common stock they represent in accordance with their own judgment on such matters.
It is important that your shares of our common stock be represented at the Annual Meeting, regardless of the number of shares that you hold. You are therefore urged to vote by telephone or by using the Internet as instructed on the enclosed proxy card or executing and returning, at your earliest convenience, the enclosed proxy card in the envelope that has also been provided.
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THE BOARD OF DIRECTORS |
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April 28, 2023 |
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SCAN TO VIEW MATERIALS & VOTE BLOCK, INC. 1955 BROADWAY, SUITE 600 OAKLAND, CA 94612 VOTE BY INTERNET Prior to The Meeting - Go to www.proxyvote.com or scan the QR Barcode above Use the Internet to transmit your voting instructions and for electronic delivery of information. Vote by 11:59 P.M. U.S. Eastern Time on June 12, 2023. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. During The Meeting - Go to www.virtualshareholdermeeting.com/SQ2023 You may attend the Meeting via the Internet and vote during the Meeting. Have the information that is printed in the box marked by the arrow available and follow the instructions. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions. Vote by 11:59 P.M. U.S. Eastern Time on June 12, 2023. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: V11929-P87892 KEEP THIS PORTION FOR YOUR RECORDS THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. DETACH AND RETURN THIS PORTION ONLY BLOCK, INC. FOR ALL WITHHOLD ALL FOR ALL EXCEPT To withhold authority to vote for any individual nominee(s), mark "FOR ALL EXCEPT" and write the number(s) of the nominee(s) on the line below. The Board of Directors recommends you vote FOR ALL of the following Class II nominees: 1. TO ELECT FOUR CLASS II DIRECTORS UNTIL OUR 2026 ANNUAL MEETING OF STOCKHOLDERS AND UNTIL THEIR SUCCESSORS ARE DULY ELECTED AND QUALIFIED. NOMINEES: 01) ROELOF BOTHA 02) AMY BROOKS 03) SHAWN CARTER 04) JAMES MCKELVEY The Board of Directors recommends you vote FOR the following proposals: FOR AGAINST ABSTAIN 2. TO APPROVE, ON AN ADVISORY BASIS, THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS. 3. TO RATIFY THE APPOINTMENT OF ERNST & YOUNG LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR OUR FISCAL YEAR ENDING DECEMBER 31, 2023. The Board of Directors recommends you vote AGAINST the following proposal: FOR AGAINST ABSTAIN 4. STOCKHOLDER PROPOSAL REGARDING OUR DIVERSITY AND INCLUSION DISCLOSURE SUBMITTED BY ONE OF OUR STOCKHOLDERS, IF PROPERLY PRESENTED AT THE ANNUAL MEETING. NOTE: The proxy holders will vote in their discretion on such other business as may properly come before the meeting or any adjournments or postponements thereof. Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer. Signature and Title (If applicable) [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date
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Important Notice Regarding the Availability of Proxy Materials for the 2023 Annual Meeting: The Notice & Proxy Statement and Form 10-K are available at www.proxyvote.com. V11930-P87892 BLOCK, INC. 2023 Annual Meeting of Stockholders June 13, 2023 10:00 AM U.S. PDT This proxy is solicited by the Board of Directors The undersigned stockholder(s) hereby appoint(s) Jack Dorsey, Amrita Ahuja and Chrysty Esperanza, or any of them, as proxies, each with the power to appoint his or her substitute, and hereby authorize(s) them to represent and to vote, as designated on the reverse side of this ballot, all of the shares of common stock of BLOCK, INC. that the stockholder(s) is/ are entitled to vote at the 2023 Annual Meeting of Stockholders to be held at 10:00 AM U.S. PDT on June 13, 2023, at www.virtualshareholdermeeting.com/SQ2023, and any adjournments or postponements thereof. This proxy, when properly executed, will be voted in the manner directed herein. If no such direction is made, this proxy will be voted in accordance with the Board of Directors' recommendations. The above named proxies are authorized to vote in their discretion upon such other business as may properly come before the meeting or any adjournments or postponements thereof. Continued and to be signed on reverse side
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice and Proxy Statement and Form 10-K are available at wvnvoroxyvotecom. D73780P69573 BLOCK, INC Annual Meeting of Stockholders June 14, 2022 10:00 AM U.S. PDT This proxy is solicited by the Board of Directors The undersigned stockholder(s) hereby appoint(s) lack Dorsey. Amrita Ahuja and Sivan Whiteley. or any of them, as proxies, each with the power to appoint his or her substitute, and hereby authorize(s) them to represent and to vote, as designated on the reverse side of this ballot, all of the shares of common stock of BLOCK, INC. that the stockholder(s) is/are entitled to vote at the Annual Meeting of Stockholders to be held at 10:00 AM U.S. PDT on june 14, 2022, at www.Virtualshareholdermeeting.com/SQ2022, and any adjournments or postponements thereof. This proxy, when properly executed, will be voted in the manner directed herein. If no such direction is made, this proxy will be voted in accordance with the Board of
Directors' recommendations. The above named proxies are authorized to vote in their discretion upon such other business as may properly come before the meeting or any adjournments or postponements thereof. Continued and to be signed on reverse side