Company: DMRC
Filing Date: 2025-03-25
Form Type: DEF 14A
Source: 0001437749-25-009135
Chunk: 46

Company: Digimarc CORP
Filing Date: 2025-03-25
Form: DEF 14A
Chunk 46
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 Net Income, and two strategic metrics: (i) improvement in strategic operating objectives; and (ii) improvement in organizational health focused on collaboration and clear and concise communication to drive efficiency, productivity, and growth. The Compensation Committee measured improvement in strategic operating objectives on strategic action scores and improvement in organizational health on specific employee survey questions, both versus baselines established at the beginning of the year. The Compensation Committee tied all executives to the same goals to emphasize the importance of collaboration and teamwork in driving this success.

| Category                                       | Performance Measures                                                                                                                                                                                                                      | How Calculated                                                                                                                                                                                                                          | Reason for Use                                                                                                                                       |
| Financial                                      | Gross New ARR Growth                                                                                                                                                                                                                      | Gross New ARR(1) growth measures the new ARR added in fiscal year 2024                                                                                                                                                                  | Gross New ARR growth provides a leading indicator of future subscription revenue growth through penetration into new areas of business opportunities |
| Improvement in Q4 Adjusted Non-GAAP Net Income | Adjusted Non-GAAP Net Income for the 4th quarter of 2024 represents reported Non-GAAP Net Income or Loss, which excludes non-cash and non-recurring items, adjusted for cash incentive compensation and normalization of service revenues | Adjusted Non-GAAP Net Income is a proxy for normalized cash flow used in operations                                                                                                                                                     |                                                                                                                                                      |
| Strategic                                      | Communication and Collaboration                                                                                                                                                                                                           | Based on improvement in employee survey on questions regarding collaboration and clear communications                                                                                                                                   | Digimarc’s success will be heavily driven by collaboration and all operating as One Company that is agile, resilient, and adaptive                   |
| Strategic Operating Objectives                 | Plan measures improvement in organization’s standard operating objectives spanning all functions of the organization—Score calculated from 1-5 on all Company Strategic Operating Objectives                                              | Strategic Operating Objectives are cross-functional short-term initiatives focused on driving the Company’s long-term success, with each having an executive lead and cross functional team designated to meet the clear-cut objectives |                                                                                                                                                      |

| (1) | Ending ARR is a company performance metric calculated as the aggregation of annualized subscription fees from all commercial contracts as of the measurement date. ARR excludes service and government revenue. Gross New ARR represents the total additions to Ending ARR throughout the year. |

The financial metrics ranged from a payout opportunity of 50% at threshold and 175% at maximum with a 65% weighting for Gross New ARR and a 35% weighting for Adjusted Non-GAAP Net Income. There was an additional 25% opportunity for achieving target on both strategic measures as they