Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
On February 21, 2024, the Talent, Leadership & Compensation Committee of the Board of Directors (the “Committee”) of Akamai Technologies, Inc. (“Akamai” or the “Company”) adopted bonus and equity compensation programs for 2024 for the following individuals (Akamai’s principal executive officer, principal financial officer and Akamai’s other currently serving named executive officers): F. Thomson Leighton, Chief Executive Officer; Edward McGowan, Chief Financial Officer; Paul Joseph, Executive Vice President, Global Sales and Services; Adam Karon, Chief Operating Officer and General Manager of the Cloud Technology Division; and Mani Sundaram, Executive Vice President and General Manager, Security Technology Group (each, an “Executive” and collectively, the “Executives”).
Each Executive is eligible to participate in a 2024 bonus program that provides for payment to the extent designated corporate performance objectives are met. Such amounts will be paid in shares of vested common stock issued under the Amended and Restated Akamai Technologies, Inc. 2013 Stock Incentive Plan (the “Plan”), in lieu of cash; the number of shares to be issued, if any, will be calculated by dividing the bonus value achievement by the closing sale price of the Company’s common stock on the date that financial results for 2024 are certified by the Committee (the “2024 Certification Date”). For each of the Executives, the performance objectives consist of and are weighted as follows: 50% based on Akamai’s achievement of a specified revenue target for fiscal year 2024 and 50% based on Akamai’s achievement of a specified adjusted operating income target for fiscal year 2024. Calculation of performance against the revenue and adjusted operating income targets will take into account the impact of foreign currency fluctuations. In addition, the bonus is subject to a modifier based on designated environmental, social and governance (“ESG”) objectives for 2024 established by the Committee. If management exceeds the ESG goals, the bonus earned based on the financial metrics above will be increased by up to 10%; if management fails to meet the ESG goals, the bonus earned on the financial metrics above will be decreased by up to 10%. The foregoing description is qualified in its entirety by the full text of the bonus plan set forth in Exhibit 99.1 and incorporated herein by reference.
For Mr. Leighton, his 2024 base salary will be $1.00, with a target bonus value of $1,500,000 and maximum value of $3,300,000. For Mr. McGowan, his 2024 base salary will be $535,000, with a target bonus equal to 85% of his 2024 salary earnings and a maximum bonus equal to 187% of his 2024 salary earnings. For Mr. Joseph, his 2024 base salary will be $520,000, with a target bonus equal to 100% of his 2024 salary earnings and a maximum bonus equal to 220% of his 2024 salary earnings. For Mr. Karon, his 2024 base salary will be $570,000, with a target bonus equal to 100% of his 2024 salary earnings and a maximum bonus equal to 220% of his 2024 salary earnings. For Mr. Sundaram, his 2024 base salary will be $500,000, with a target bonus equal to 80% of his 2024 salary earnings and a maximum bonus equal to 176% of his 2024 salary earnings.
As described in the table below, the Committee also approved grants to the Executives of restricted stock units (“RSUs”) under the Plan, consisting of annual vesting RSUs, corporate performance-based RSUs and stock performance-based RSUs as follows: