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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(RULE 14a-101)
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. )
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 Pursuant to §240.14a-12
National Instruments Corporation
(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 all boxes that apply):
No fee required
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

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Proxy Statement
National Instruments Corporation | 2022 Annual Meeting of Stockholders
 

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Letter to our Stockholders from
our Board Chair and our Chief Executive Officer and President
March 28, 2022
Dear Fellow Stockholders,
On behalf of our Board of Directors (the “Board”) and management team of National Instruments Corporation (the “Company” or “NI”), we are pleased to invite you to attend our virtual 2022 Annual Meeting of Stockholders (the “Annual Meeting”) on May 10, 2022, at 9:00 a.m., Central Daylight Time. A notice of the meeting and our 2022 Proxy Statement containing important information about the matters to be voted upon and instructions on how you can vote your shares follow this letter.
This year we are offering a virtual stockholder meeting through which you can view the Annual Meeting, submit questions and vote online. We will also provide a live webcast of the Annual Meeting at www.virtualshareholdermeeting.com/NATI2022. A webcast, slides, and audio of the entire Annual Meeting will be available on the Investor Relations page of our Company website within a few days of the meeting and will remain available for one year from the date of the meeting. We hope this will enable those who cannot attend the virtual meeting in real-time to hear NI’s executives discuss our plans. In addition, we make available at our Investor Relations website a variety of information for investors. Our goal is to maintain the Company Investor Relations page as a portal through which investors can easily find or navigate to pertinent information about us.
Your vote is important to us. Whether or not you attend the Annual Meeting, it is important that your shares be represented and voted at the meeting. Therefore, we urge you to promptly vote and submit your proxy via the internet, by phone, or by signing, dating, and returning the enclosed proxy card in the enclosed envelope. If you attend the Annual Meeting, you can vote at the meeting (electronically), even if you have previously submitted your proxy.
On behalf of the Board, we would like to express our appreciation for your continued investment in NI. We look forward to greeting as many of you as possible.
Sincerely,


Michael E. McGrath
Board Chair
Eric H. Starkloff
CEO and President
 

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Notice of 2022 Annual

Meeting of Stockholders
Meeting Information

Date & Time
Tuesday, May 10, 2022
9:00 a.m., CDT

Location
Via live webcast by visiting the following website:
www.virtualshareholdermeeting.com/NATI2022

Record Date
March 14, 2022
How to Vote
Your vote is important! Please vote your shares at the meeting (electronically) or in one of the following ways:
By Internet
By Phone
By Mail
By Mobile Device
Visit the website listed in your notice of internet availability of proxy materials or your proxy or voting instruction form
Call the toll-free voting number in your voting materials
Mail your completed and signed proxy or voting instruction form
Scan the QR Barcode on your voting materials
Items of Business
1
Elect the director nominees named in our proxy statement for a term of three years.
2
Increase the number of shares reserved under the National Instruments Corporation 1994 Employee Stock Purchase Plan by 3,000,000 shares.
3
Approve the National Instruments Corporation 2022 Equity Incentive Plan.
4
​Approve, on an advisory (non-binding) basis, National Instruments Corporation's executive compensation program.
5
Ratify the appointment of Ernst & Young LLP as the National Instruments Corporation’s independent registered public accounting firm for 2022.
6
Consider any other business properly brought before the meeting.
By Order of our Board of Directors,

R. Eddie Dixon, Jr.
Chief Legal Officer, Senior Vice President & Secretary
March 28, 2022
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Stockholders to be Held on May 10, 2022: National Instruments Corporation’s 2022 Proxy Statement and Annual Report to Stockholders for the year ended December 31, 2021 are available at:
www.virtualshareholdermeeting.com/NATI2022
This Notice and the accompanying Proxy Statement, 2021 Annual Report, and Proxy Card or voting instruction form were first made available to stockholders beginning on March 28, 2022. You may vote if you owned shares of our common stock at the close of business on March 14, 2022, the record date for notice of and voting at our Annual Meeting.

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INTRODUCTION
This Proxy Statement contains the information that a stockholder should know before voting on the proposals described in the Notice. This introduction highlights certain information contained in this Proxy Statement as well as other relevant information. You should read the entire Proxy Statement carefully before voting.
Our Business
NI started over 40 years ago on an idea of connecting engineers through software. Our founders created technology to connect instruments to computers in order to accelerate the testing and measurement of innovative technology, and this was the seed of a philosophy of accelerating innovation that continues to be a driving force of our culture, our business, and our operations today. We strive to enable customers around the world to do their most ambitious work while meeting fast-moving market demands. We provide the integration of modular hardware and open, flexible software systems, to consistently support organizations’ evolving test and measurement needs. Our hope is that in 100 years’ time, future generations will continue to benefit from the results of the innovation we make possible today.
We are continuing to experience strong demand from our customers across the geographic regions and end markets that we serve, with the value of total orders during 2021 increasing by approximately 24% compared to the same period in 2020. Although the strength and duration of the recent trends will vary by region and offering, we remain optimistic about opportunities for additional revenue growth expected in 2022. We expect our customers will continue to make investments in emerging technologies related to 5G/mmWave, vehicle electrification, ADAS and new space innovation. While we expect to continue to experience some challenges related to supply chain constraints as the global supply chain continues to adjust to the significant increases in demand, we are optimistic about our ability to maintain competitive lead times while continuing to maintain higher backlog levels as part of our strategic focus on application-specific system offerings through 2022 and beyond.
Our Strategy
Our overarching goal, which we call our core strategic vision, is to be the leader in software-connected automated test and automated measurement systems. This vision provides a framework to help us achieve our financial goals of accelerated growth and enhanced profitability by:
Delivering value that gives our customers a competitive advantage;
Providing a differentiated software-defined platform for automated test and automated measurement systems;
Focusing on industry-specific applications that benefit from our platform's disruptive capabilities;
Enhancing our system-level offerings to more fully meet customers' enterprise-wide challenges; and
Aligning resources to the critical needs of our growth strategy to drive efficiency in our cost structure.
In pursuing our vision, we have empowered our team to be deliberate about the market opportunities we pursue to accelerate growth by targeting the applications where we believe our systems can provide significant value to our customers. We believe our long-term track record for innovation and our differentiation in the market helps support the success of our customers, employees, community, and stockholders.
Our philosophy of putting the needs of our customers first and elevating the impact of their creativity and innovation is at the heart of how we do business. We utilize our expertise to partner with talented engineers and enterprises around the world to push the limits of innovation. We believe it is a combination of our people, technology and data that make a difference in helping our customers reach speed, scale and efficiency across the product development cycle.
Business Evolution
Our business has undergone a transformation to improve performance, enhance customers engagements, and align investments to high growth opportunities. To achieve this level of change requires clear focus and strong leadership. We will remain focused on accelerating our strategy for sustainable long-term growth, executing on our business goals, winning in our markets, and delivering increased value to all stakeholders.
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Company Culture: Core Values and Corporate Identity
2021 represented an inflection point of performance for NI. We continued to deliver on our commitment to accelerate growth and improve profitability. Our strong financial performance is a direct result of strategic changes made over the last several years. Our executive and management teams have endeavored to provide our employees with a clear understanding of why changes are being implemented and how they align to our corporate strategy. We believe the transparency of our strategy has enabled our employees to better understand how their role can make an impact toward achievement of our long-term financial targets.
We place a high degree of emphasis on employee engagement globally and believe that job satisfaction, clear career paths, and the difference our employees can make to our customers and society through engineering ambitiously will lead to a high performing global workforce. Our employee engagement scores have increased over the last three years while organizational change was at its highest. Successful retention of our talent is a key measure of our sustainability as an organization and thus a strategic focus for our executive leadership team.
In connection with the organizational changes we have made, we also redefined our purpose and our core values:
Be Bold
Be Kind
Be Connectors
Bold in our decisions and to challenge the status quo; Kind and candid in our interactions while promoting belonging, inclusion and constant respect for all people; and Connectors of people, ideas and technology.
We believe these values represent the strong culture of NI and how we want to be seen both internally at NI and externally with all our stakeholders. These are the values that we assess in both recruiting and retainment.
Value for all our Stakeholders
We are focused on creating long-term value for all of our stakeholders. Our ability to accelerate growth and generate profit delivers value to our customers, employees, stockholders, and community. Customers benefit from our continued investment in our technology and the expertise to support their success and technology needs. Employees benefit through the creation of opportunities for personal career growth and development. Stockholders benefit from receiving a solid return on the investment they make in us. Our success benefits our community of developers that build on our technology as well as the communities where we live, work, and give back.

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Corporate Impact
We believe businesses of all kinds should be a leading force for good. At NI, that means driving change through our people, our technology, and our actions. This is the right thing to do and is vital to our long-term stability. We are part of diverse, interconnected systems — our company, our communities and our planet — that must work together to survive and thrive. Keeping these systems healthy is critical to fulfilling the promise of NI’s 100-year plan: to deliver consistent, lasting value for all our stakeholders across time.
To this end, we spent 2020 interviewing our stakeholders — including NI stockholders, leaders, employees, suppliers, partners, and customers — to inform the development of our 2030 Corporate Impact Strategy (launched in February 2021). Equipped with these insights and a better understanding of the most material issues we face, we created a strategic framework that outlines our goals and commitments for making a measurable difference over the next decade. It builds on our deep-rooted culture of giving back and focuses on three core ideas: changing the face of engineering, building a more equitable and thriving society, and engineering a healthier planet. Details of our Corporate Impact Strategy can be found on our website at www.ni.com/en-us/about-ni/corporate-impact.html. For the steps that we have taken with respect to governance, please see “Corporate Governance” section in this introduction below.
The oversight, management, and implementation of Environment, Social and Governance (“ESG”) programs and initiatives are structured to ensure these efforts are truly cross-functional and collaborative. The Board oversees ESG matters through its governance, audit and compensation committees. The executive leadership team (“ELT”) generally implements these programs through the Diversity Equity and Inclusion and Belonging (“DEIB”) Executive Council, Executive Impact Council, and the management leaders and related working groups noted below.

INVESTOR ENGAGEMENT PROGRAM
In recent years we have actively solicited the perspectives of many of our stockholders to help identify focus areas and priorities for the coming year. For example, outreach efforts in the fourth quarter of 2021 included requesting calls with our top 20 institutional stockholders. The discussions held with those who accepted our invitation were directed primarily toward the resiliency of our business, importance of our culture and executive compensation. Topics of discussion included, among others: (i) clarity of our growth strategy with focus on software and fast-growing megatrends like 5G, autonomous and electric vehicles, and new technology for space innovation; (ii) elevation and progress of diversity initiatives since 2020; (iii) launch of our first Corporate Impact metrics report and (iv) our continued focus on environmental initiatives.
Each year the constructive and candid feedback we receive during these investor meetings helps inform our priorities, assess our progress, and enhance our corporate governance practices and disclosures.
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CORPORATE GOVERNANCE
In prior years, we have taken action to enhance our governance practices in response to stockholder feedback. The following are some of the steps that we have taken in order to address issues our stockholders and other members of the investment community have identified as priorities.

We will continue to consider other actions we should take in response to our stockholder feedback and will continue to enhance our stockholder engagement program in order to consistently engage with, listen to, and learn from our stockholders.
Qualifications and Experience of Directors
In considering each of our directors, the Board and the Nomination & Governance Committee has evaluated a potential director’s background, qualifications, attributes and relevant skills. The Board and the Nomination & Governance Committee have considered those nomination criteria described below, as well as the value of the relationships directors have formed while working together on the Board and the deep knowledge of NI they have developed as a result of such service. The Board and the Nomination & Governance Committee also evaluated each of the director’s contributions to the Board and role in the operation of the Board as a whole.
We believe our director nominees bring a well-rounded variety of experiences, qualifications, attributes and relevant skills, and represent a balance of experience with NI and a fresh perspective. The table below summarizes some of the experience, qualifications, attributes and skills of our directors. This high-level summary is not intended to be an exhaustive list of our directors’ skills or contributions to the Board, but an identification of special expertise or prominence that a particular director may bring to the Board as a whole. Further information on each director, including his or her specific experience, qualifications, attributes and skills, is set forth in the biographies on pages 5 to 9 of this Proxy Statement.
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Our Directors’ Skills and Diverse Qualifications

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In addition, the Nomination & Governance Committee and the Board consider diversity in the characteristics of director candidates, including each candidate’s unique background, with the goal of enhancing the Board’s ability to effectively perform its oversight function.
Board Diversity Matrix (as of March 14, 2022)

Our Board is divided into three classes, with the terms of the Class I directors expiring this year. The Board and the Nomination & Governance Committee has nominated Mr. James E. Cashman, III, Mr. Liam K. Griffin, and Mr. Eric H. Starkloff for election at the Annual Meeting to serve for a term of three years.
James E. Cashman, III
Independent
Liam K. Griffin
Independent
Eric H. Starkloff
President and CEO
Former Board Chairman of ANSYS, Inc; Former President and Chief Executive Officer of ANSYS, Inc.
President, Chief Executive Officer and Chairman of the board of directors of Skyworks Solutions, Inc.
Age: 68
Director Since: 2019
Committees: Audit, Nomination & Governance (Chair)
Other Public Boards: 1
Age: 55
Director Since: 2019
Committees: Compensation, Nomination & Governance
Other Public Boards: 1
Age: 47
Director Since: 2020
Committees: None
Other Public Boards: 0
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PROXY STATEMENT
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NATIONAL INSTRUMENTS CORPORATION
PROXY STATEMENT
INFORMATION CONCERNING SOLICITATION AND VOTING
General
The Board of Directors (the “Board”) of National Instruments Corporation, a Delaware corporation (“NI” or the “Company”), has made proxy materials available to you on the internet or, upon your request, has delivered printed versions of proxy materials to you by mail, in connection with the Board’s solicitation of proxies for use at NI’s 2022 Annual Meeting of Stockholders (the “Annual Meeting”) to be held on May 10, 2022, at 9:00 AM, Central Daylight Time, or at any adjournments or postponements thereof, for the purposes set forth in this Proxy Statement and in the accompanying Notice of Annual Meeting of Stockholders. The Annual Meeting will be held virtually via live webcast at www.virtualshareholdermeeting.com/NATI2022.
Under rules adopted by the U.S. Securities and Exchange Commission (the “SEC”), NI is furnishing proxy materials to NI’s stockholders on the internet, rather than mailing printed copies of those materials to each stockholder. If you received a Notice of Internet Availability of Proxy Materials by mail, you will not receive a printed copy of the proxy materials unless you request one. Instead, the Notice of Internet Availability of Proxy Materials will instruct you as to how you may access and review the proxy materials on the internet. If you received a Notice of Internet Availability of Proxy Materials by mail and would like to receive a printed copy of our proxy materials, please follow the instructions included in the Notice of Internet Availability of Proxy Materials. We anticipate that the Notice of Internet Availability of Proxy Materials will be mailed to stockholders on or about March 28, 2022.
NI's corporate offices are located at 11500 North Mopac Expressway, Austin, Texas 78759. NI’s general corporate telephone number is (512) 683-0100.
Householding of Annual Meeting Materials
Some brokers and other nominee record holders may be participating in the practice of “householding” notices of internet availability of proxy materials, proxy statements and annual reports. This means that, unless NI has received instructions to the contrary, only one copy of the Notice of Internet Availability of Proxy Materials may have been sent to multiple stockholders living in the same household. We will promptly deliver a separate copy of the Notice of Internet Availability of Proxy Materials and, as applicable, any additional proxy materials to any stockholder who contacts our investor relations department at 11500 North Mopac Expressway, Austin, Texas 78759, (512) 683-5215, requesting such copies. If stockholders living in the same household are receiving multiple copies of the Notice of Internet Availability of Proxy Materials or the printed versions of such other proxy materials and would like to receive a single copy of these documents in the future, the stockholders should contact their broker, other nominee record holder, or our investor relations department to request mailing of a single copy of any of these documents.
Record Date; Outstanding Shares
Stockholders of record at the close of business on March 14, 2022 (the “Record Date”) are entitled to receive notice of and vote at the Annual Meeting. On the Record Date, 132,038,488 shares of NI’s common stock, $0.01 par value, were issued and outstanding.
Voting and Solicitation
Every stockholder of record on the Record Date is entitled, for each share held, to one vote on each proposal that comes before the Annual Meeting. In the election of directors in Proposal One, each stockholder will be entitled to vote for three nominees and the three nominees with the greatest number of votes will be elected. However, pursuant to the terms of our Corporate Governance Guidelines, any nominee for director in an uncontested election who receives a greater number of “withhold” votes than votes “for” such election shall promptly tender his or her resignation following certification of the stockholder vote. See “Proposal One: Election of Directors—Vote Required; Recommendation of the Board of Directors” for additional information on these guidelines.
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The affirmative vote of the holders of a majority of the shares of common stock of the Company issued and outstanding and entitled to vote as of the Record Date will be required to approve Proposal Two. The affirmative vote of a majority of the shares of NI common stock that are present at the meeting (electronically) or by proxy, and entitled to vote, will be required to approve Proposals Three, Four and Five.
Whether you hold shares directly as the stockholder of record or beneficially in street name, you may vote on the internet, by telephone or, if you received a paper copy of the proxy materials, by completing, signing and mailing the proxy card enclosed therewith in the postage-prepaid envelope provided for that purpose. Voting over the internet, by telephone or by written proxy will ensure your representation at the Annual Meeting, if you do not attend and vote via live webcast. For specific instructions on how to vote your shares, please review the instructions on the Notice of Internet Availability of Proxy Materials you received in the mail or the proxy card if you received a paper copy of the proxy materials.
The cost of this solicitation will be borne by NI. NI may reimburse expenses incurred by brokerage firms and other persons representing beneficial owners of shares in forwarding solicitation materials to beneficial owners. Proxies may be solicited by certain of NI’s directors, officers and other employees, without additional compensation, personally, by telephone or by email.
Treatment of Abstentions and Broker Non-Votes
Abstentions
Abstentions will be counted for purposes of determining (i) the presence or absence of a quorum for the transaction of business and (ii) for purposes of determining the number of outstanding shares entitled to vote and voted, at the meeting (electronically) or by proxy. Thus, abstentions will have the same effect as a vote against Proposals Two, Three, Four and Five. There is no voting option to abstain with respect to Proposal One.
Broker Non-Votes
A broker will vote your shares only if the proposal is a matter on which your broker has discretion to vote (such as the ratification of our independent registered public accounting firm in Proposal Five), or if you provide instructions on how to vote by following the instructions provided to you by your broker.
So long as a broker has discretion to vote on at least one item presented at the meeting, broker non-votes will be counted for purposes of determining the presence or absence of a quorum for the transaction of business. On other proposals for which the broker has expressly not voted, broker non-votes will not be counted: (i) as votes cast with respect to Proposal One, or (ii) for purposes of determining the number of outstanding shares entitled to vote, that are present at the meeting (electronically) or by proxy, with respect to Proposal Two, Three or Four. Accordingly, broker nonvotes will have no effect on the outcome of the voting on Proposal One, Two, Three or Four. There will be no broker non-votes with respect to Proposal Five.
Tabulation and Reporting of Voting Results
Final voting results will be tallied by the inspector of election after the taking of the vote at the Annual Meeting. NI will publish the final voting results in a Current Report on Form 8-K filed with the SEC within four business days following the Annual Meeting.
Revocability of Proxies
Proxies given pursuant to this solicitation may be revoked at any time before they have been used. You may change or revoke your proxy by entering a new vote by internet or by telephone or by delivering a written notice of revocation to the Secretary of NI or by completing a new proxy card bearing a later date (which automatically revokes the earlier proxy instructions). Attendance at the Annual Meeting will not cause your previously granted proxy to be revoked unless you vote at the Annual Meeting.
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DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS
Stockholders of NI may submit proper proposals for inclusion in our proxy statement and for consideration at the annual meeting of stockholders to be held in 2023 by submitting their proposals in writing to the Secretary of NI in a timely manner. In order to be considered for inclusion in NI’s proxy materials for the annual meeting of stockholders to be held in 2023, stockholder proposals must be received by the Secretary of NI no later than November 28, 2022 and must otherwise comply with the requirements of Rule 14a-8 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
Under NI’s amended bylaws (the “Bylaws”), a stockholder (or a group of not more than 20 stockholders) that has held at least 3% of NI’s outstanding common stock continuously for at least three years, may nominate and include in our proxy materials for our 2023 annual meeting, director nominees constituting up to the greater of (i) 20% of the number of directors serving on the Board as of November 28, 2022 and (ii) two directors, provided that such nominees do not exceed half of the directors to be elected at an annual meeting and that the requirements set forth in the Bylaws are satisfied. To utilize such “proxy access” nomination process, among other things, the electing stockholder(s) and proposed nominee(s) must comply with the detailed requirements set forth in the Bylaws, including the provision of the proposing stockholder information, various other required information, representations, undertakings, agreements and other requirements as set forth in the Bylaws and as required by law. One such requirement is that the nomination(s) must be received in a timely manner between 120 days and 150 days prior to the first anniversary of the date our proxy statement was first sent to stockholders in connection with the last annual meeting, which for our proxy materials for the 2023 annual meeting would be no earlier than October 29, 2022 and no later than November 28, 2022.
The Bylaws establish an advance notice procedure with regard to business to be brought before an annual meeting, including stockholder proposals not included in NI’s proxy statement. Except as provided above, for director nominations or other business to be properly brought before NI’s 2023 annual meeting by a stockholder, such stockholder must deliver written notice to the Secretary of NI at NI’s principal executive office no later than January 27, 2023 and no earlier than December 28, 2022. If the date of NI’s 2023 annual meeting is advanced or delayed by more than 30 calendar days from the first anniversary date of this Annual Meeting, a stockholder’s notice of a proposal will be timely if it is received by NI by the close of business on the later of (i) the 90th day prior to the 2023 annual meeting and (ii) the 10th day following the day NI first publicly announces the date of the 2023 annual meeting.
The proxy grants the proxy holders discretionary authority to vote on any matter raised at an annual meeting of stockholders. If a stockholder fails to comply with the foregoing notice provisions, proxy holders will be allowed to use their discretionary voting authority on such matter should the stockholder proposal come before the 2023 annual meeting.
The description of certain provisions of the Bylaws above is intended as a summary and is qualified in its entirety by reference to the relevant Bylaw provisions regarding the requirements for making stockholder proposals and nominating director candidates. A copy of the full text of the Bylaw provisions governing the notice requirements set forth above may be obtained by writing to the Secretary of NI. All notices of proposals and director nominations by stockholders should be sent to National Instruments Corporation, 11500 North Mopac Expressway, Building C, Austin, Texas 78759, Attention: Secretary.
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PROPOSAL ONE: ELECTION OF DIRECTORS
General
NI’s Board is divided into three classes, with the term of the office of one class expiring each year. The authorized number of directors which constitutes the entire Board is currently eight, with three directors in Class I, two directors in Class II, and three directors in Class III. The authorized number of directors on our Board was reduced from nine members to eight members during 2021, after Mr. Charles J. Roesslein’s retirement.
The terms of office of our Class I directors will expire at the Annual Meeting and include Mr. James E. Cashman, III, Mr. Liam K. Griffin, and Mr. Eric H. Starkloff. Our Board has nominated Mr. James E. Cashman, III, Mr. Liam K. Griffin, and Mr. Eric H. Starkloff for election at the Annual Meeting as Class I directors to serve for a term of three years.
The terms of office of Class II directors Mr. Michael E. McGrath and Mr. Alexander M. Davern will expire at the 2023 annual meeting and the terms of office of Class III directors Ms. Gayla J. Delly, Dr. Gerhard P. Fettweis, and Ms. Duy-Loan T. Le will expire at the 2024 annual meeting.
Under the listing requirements of the Nasdaq Stock Market (“Nasdaq”), a majority of the Board must be comprised of independent directors. The Board has determined that each of Mr. Cashman, Ms. Delly, Dr. Fettweis, Mr. Griffin, Ms. Le, and Mr. McGrath is (and, prior to his retirement in May 2021, Mr. Roesslein was) independent under applicable Nasdaq listing standards and Rule 10A-3 of the Exchange Act.
Vote Required; Recommendation of the Board of Directors
Directors shall be elected by a plurality of the votes. Each stockholder will be entitled to vote for three nominees and the three nominees receiving the greatest number of affirmative votes of the shares present at the meeting (electronically) or represented by proxy at the Annual Meeting, and entitled to vote in the election of directors, shall be elected to the Board. Votes withheld from any director are counted for purposes of determining the presence or absence of a quorum. Cumulative voting is not permitted by NI’s Certificate of Incorporation.
Pursuant to NI’s Corporate Governance Guidelines, any nominee for director in an uncontested election (i.e., an election where the only nominees are those recommended by the Board) who receives a greater number of “withhold” votes from his or her election than votes “for” such election, shall promptly tender his or her resignation following certification of the stockholder vote. In such event, the Nomination & Governance Committee will promptly consider the tendered resignation and will recommend to the Board whether to accept the tendered resignation or to take some other action, such as rejecting the tendered resignation and addressing the apparent underlying causes of the “withhold” votes. In making this recommendation, the Nomination & Governance Committee will consider all factors deemed relevant by its members including, without limitation, the underlying reasons why stockholders withheld votes for election from such director (if ascertainable), the length of service and qualifications of the director whose resignation has been tendered, the director’s contributions to NI, whether by accepting such resignation NI will no longer be in compliance with any applicable law, rule, regulation or governing document, and whether or not accepting the resignation is in the best interests of NI and its stockholders.
The Board will act on the Nomination & Governance Committee’s recommendation no later than 90 days following its receipt of such recommendation. In considering the Nomination & Governance Committee’s recommendation, the Board will consider the factors considered by the Nomination & Governance Committee and such additional information and factors the Board believes to be relevant.
Unless otherwise instructed, the proxy holders will vote the proxies received by them for NI’s nominees named below. If any nominee of NI is unable or declines to serve as a director at the time of the Annual Meeting, the proxies will be voted for any nominee who is designated by the present Board to fill the vacancy. It is not currently expected that any nominee will be unable or will decline to serve as a director.
The Board of Directors unanimously recommends a vote “FOR” the nominees listed below.
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Nominees for Election at the Annual Meeting
The Nomination & Governance Committee, consisting solely of independent directors as determined under applicable Nasdaq listing standards, recommended the three individuals set forth in the table below for nomination by our full Board. Based on such recommendation, our Board nominated such directors for election at the Annual Meeting. The Board has determined that Mr. James E. Cashman, III and Mr. Liam K. Griffin are each independent under applicable Nasdaq listing standards and Rule 10A-3 of the Exchange Act. The following sets forth information concerning the nominees for election as directors at the Annual Meeting, including information as to each nominee’s age as of the Record Date, current principal occupation and business experience.


James E. Cashman, III, 68 - Director since March 2019; Former Board Chairman of ANSYS, Inc; Former President and Chief Executive Officer of ANSYS, Inc.
Business Experience: Mr. Cashman was Chairman from January 2017 through April 2019 of ANSYS Inc., an engineering simulation software company. Prior to becoming Chairman of ANSYS, Mr. Cashman was the Chief Executive Officer and a director of ANSYS from February 2000 through December 2016. Prior to his general management role with ANSYS, Mr. Cashman served as Senior Vice President of Operations of ANSYS from September 1997 to April 1999. He also served from 1995 to 1997, as Vice President of Marketing and International Operations at PAR Technology Corporation, a computer software and hardware company, and from 1992 to 1994, he was Vice President of Product Development and Marketing at Metaphase Technology, Inc., a product data management company, which was a joint venture of Structural Dynamics Research Corporation and Control Data Systems. From 1976 to 1992, he worked in various sales and technical positions at Structural Dynamics Research Corporation, a computer-aided design company. Mr. Cashman holds a bachelor’s degree in Mechanical Engineering and a master’s degree in Business Administration, both from the University of Cincinnati. Mr. Cashman is the Chairman of the board of directors of Certara, Inc., a publicly traded company, and is a member of its Compensation and Nominating and Corporate Governance Committees.
The Board concluded that Mr. Cashman should serve as a director because he brings a wealth of experience in the areas of technical, financial, operations and sales management and has been key to the success of numerous computer-aided design, product data management, transaction processing, and computer-aided engineering companies. In each role, Mr. Cashman has focused on developing clarity-of-vision and giving appropriate guidance to provide strong leadership. He serves as a member of our Audit Committee and Chair of our Nomination & Governance Committee.
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Liam K. Griffin, 55 - Director since March 2019; President, Chief Executive Officer, and Chairman of Skyworks Solutions, Inc.
Business Experience: Mr. Griffin is the President, Chief Executive Officer and Chairman of the board of directors of Skyworks Solutions, Inc. (“Skyworks”). Prior to his appointment as Chairman and Chief Executive Officer of Skyworks in May 2021 and May 2016, respectively, he had served as director and President of Skyworks since May 2016 and May 2014, respectively. Mr. Griffin also served in the following positions at Skyworks: from November 2012 to May 2014, as Executive Vice President and Corporate General Manager; from May 2011 to November 2012, as Executive Vice President, High Performance Analog; and from August 2001 to May 2011, as Senior Vice President of Sales and Marketing. He also served from 1995 to 2001 as Vice President of North American Sales and then Vice President of Worldwide Sales at Vectron International, a division of Dover Corporation. Prior to that, Mr. Griffin was a Marketing Manager at AT&T Microelectronics, Inc. and a Product and Process Engineer at AT&T Network Systems. Mr. Griffin holds a bachelor’s degree in Mechanical Engineering from the University of Massachusetts-Amherst and a master’s degree in Business Administration from Boston University. He previously served as a director of Vicor Corporation, a publicly traded company, from 2009 to 2019.
The Board concluded that Mr. Griffin should serve as a director because of his breadth of leadership experience and in-depth understanding of the semiconductor industry and its competitive landscape gained through serving in several different executive positions at Skyworks over the past 15 years. His service as a director for Vicor Corporation gives Mr. Griffin added perspective as to the challenges confronting public technology companies. In considering the independence of Mr. Griffin, it was noted that Mr. Griffin is Chief Executive Officer, President and a director of Skyworks and that NI has a commercial relationship with Skyworks and, for the year ended December 31, 2021, had transactions with Skyworks totaling approximately $1,516,081 in the ordinary course of business. Given the relative size of the businesses of NI and Skyworks, it was determined that such relationship was not a “material interest” under applicable SEC and Nasdaq regulations. He serves as a member of our Compensation Committee and a member of our Nomination & Governance Committee.


Eric H. Starkloff, 47 - Director since February 2020; President and Chief Executive Officer of NI.
Business Experience: Mr. Starkloff joined NI in July 1997 and has served as President and Chief Executive Officer since February 2020. Previously, Mr. Starkloff served as President and Chief Operating Officer from October 2018 to February 2020. He has also served as Executive Vice President, Global Sales and Marketing from February 2014 to October 2018; Senior Vice President of Marketing from April 2013 to January 2014; Vice President of Marketing from November 2010 to March 2013; and Vice President of Product Marketing from October 2008 to October 2010. During his tenure at NI, Mr. Starkloff has also held the positions of Director of Product Marketing; Product Marketing Manager; and Applications Engineer. Mr. Starkloff received his bachelor’s degree in Electrical Engineering from the University of Virginia.
The Board concluded that Mr. Starkloff should serve as a director because he is NI’s President and Chief Executive Officer and has held other positions with NI for over 24 years. In these roles, Mr. Starkloff has gained extensive knowledge of NI’s business, financial and operations matters, and the Board believes that Mr. Starkloff is well suited to help define and execute NI’s corporate strategy.
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INCUMBENT DIRECTORS WHOSE TERMS OF OFFICE
CONTINUE AFTER THE ANNUAL MEETING
The following sets forth information concerning the other directors whose terms of office continue after the Annual Meeting, including information as to each director’s age as of the Record Date, current principal occupation and business experience.


Michael E. McGrath, 72 - Director since May 2014; Former Chief Executive Officer of i2 Technologies and Pittiglio Rabin Todd & McGrath, Business Strategy Consultant.
Business Experience: Mr. McGrath is an experienced executive, director, entrepreneur and author. His areas of expertise include strategy, product development, decision-making techniques, supply chain, and autonomous vehicles. He served as a director of i2 Technologies, a public company and supply chain management and software services vendor, from September 2004 to May 2008, and as its CEO and President from February 2005 to July 2007. He served on the board of directors of Entrust, Inc., a public company, from February 2007, and as Chairman of the Board starting in November 2008, until the company was sold in July 2009. He served as executive chairman of the board of The Thomas Group, a public company, from February 2008 to March 2012, and as acting CEO for a period of time. The Thomas Group filed for bankruptcy protection in March 2012. He also served on the board of Sensable Technologies from 2000 until 2009 and served on the board of Revolution Analytics from 2014 until 2015. He was a founder and the Chief Executive Officer of Pittiglio Rabin Todd & McGrath, a global management consulting firm, for 28 years, retiring from the firm in July 2004. Mr. McGrath is the author of Autonomous Vehicles: Opportunities, Strategies, and Disruptions; Product Strategy for High-Technology Companies; Business Decisions! and other books. Mr. McGrath received his bachelor’s degree in Computer Science from Boston College, and his master’s degree in Business Administration from Harvard Business School.
The Board concluded that Mr. McGrath should serve as a director because he has an extensive background in product development strategy, strategic product marketing, and software services. Having served as CEO of i2 Technologies, a vendor of supply chain management software, he has knowledge of software systems, experience selling into corporate opportunities, and experience developing large accounts. In particular, he has experience with management functions including software marketing and sales force management activities, and software development. He is an experienced consultant and author with knowledge of cloud computing and smartmobile applications, which are relevant for NI’s business. Mr. McGrath currently serves as our Chair of the Board as well as a member of our Audit Committee and a member of our Nomination & Governance Committee.
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Alexander M. Davern, 55 - Director since January 2017; Former Chief Executive Officer of NI.
Business Experience: Mr. Davern joined NI in February 1994 and served as Chief Executive Officer from January 2017 to January 2020 and as Strategic Advisor from January 2020 to May 2020. He previously served as President from January 2017 to October 2018. He served as Chief Operating Officer, Executive Vice President, Chief Financial Officer and Treasurer from October 2010 to December 2016. Mr. Davern also served as NI’s Chief Financial Officer, Senior Vice President, IT and Manufacturing Operations and Treasurer from December 2002 to October 2010; as Chief Financial Officer and Treasurer from December 1997 to December 2002; as Acting Chief Financial Officer and Treasurer from July 1997 to December 1997; and previously as Corporate Controller and International Controller. Prior to joining NI, Mr. Davern worked both in Europe and in the United States for the international accounting firm of Price Waterhouse, LLP. Mr. Davern received his bachelor’s degree in Commerce and a diploma in professional accounting from University College in Dublin, Ireland. Mr. Davern is a director of Cirrus Logic, Inc., a US publicly traded company, and is chair of its Audit Committee. Mr. Davern is also a Director of FARO Technologies, Inc., a US publicly traded company and is Chairman of ESI-Group, a French Public Company.
The Board concluded that Mr. Davern should serve as a director because of his former role as NI’s Chief Executive Officer and because he has held other executive officer positions with NI for over 20 years. In these roles, Mr. Davern has gained extensive knowledge of NI’s business, financial and operations matters, and the Board believes that Mr. Davern is well suited to help define and execute NI’s corporate strategy. Mr. Davern has strong expertise in governance matters.


Gayla J. Delly, 62 - Director since March 2020; Former Chief Executive Officer of Benchmark Electronics, Inc.
Business Experience: Ms. Delly served as Chief Executive Officer of Benchmark Electronics Inc. (“Benchmark”), a company that provides contract manufacturing, design, engineering, test and distribution services to manufacturers of computers, medical devices, telecommunications equipment and industrial control and test instruments from January 2012 to September 2016 and served on the board of directors of Benchmark from 2011 to September 2016. At Benchmark, she previously served as President from 2006 to December 2011, Executive Vice President and Chief Financial Officer from 2001 to 2006, and as Corporate Controller and Treasurer from 1995 to 2001. Ms. Delly is a certified public accountant and was a senior audit manager at KPMG before joining Benchmark. Ms. Delly serves as an independent director of Broadcom Inc., a public company, and is a member of its Audit Committee and Nominating and Corporate Governance Committee. Since January 2008, Ms. Delly has served as an independent director of Flowserve Corporation, a public company, and serves as a member of its Organization and Compensation Committee and its Corporate Governance & Nominating Committee. Ms. Delly served as chair of Flowserve’s audit committee from 2015 to May 2019. Ms. Delly received her bachelor’s degree in Accounting from Samford University.
The Board concluded that Ms. Delly should serve as a director because of her leadership experience in senior executive and financial management positions, her international manufacturing experience, her education and experience as an accounting professional, as well as her public company board and committee experience. She currently serves as the Chair of our Audit Committee and a member of our Compensation Committee.
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Gerhard P. Fettweis, PhD, 60 - Director since March 2016; Vodafone Chair Professor at the Technical University of Dresden.
Business Experience: Since September 1994, Dr. Fettweis has served as the Vodafone Chair Professor of Electrical Engineering at the Technical University of Dresden, where his research focuses on next generation wireless systems. In connection with that role, he has spun-out twelve startup companies from the university. From August 2015 to February 2016, he served as a visiting professor at the University of California at Berkeley and as a senior researcher at the International Computer Science Institute. Dr. Fettweis is a member of the German National Academy of Science “Leopoldina” and German National Academy of Engineering “acatech” and a fellow of the Institute of Electrical and Electronics Engineers (“IEEE”). He has received numerous awards recognizing his contributions in the field of electrical engineering. Dr. Fettweis has authored or co-authored two books and is listed as an inventor on over thirty issued patents. Dr. Fettweis received his Dipl.-Ing. in Electrical Engineering in 1986 and his PhD in Electrical Engineering in 1990, each from Aachen University of Technology.
The Board concluded that Dr. Fettweis should serve as a director because of his strong technical background and extensive knowledge in electrical engineering, as well as his experience in science, technology and business. Additionally, he is very involved in the scientific community and has leadership and management experience through his role as the Vodafone Chair Professor at the Technical University of Dresden. He currently serves as a member of our Audit Committee and a member of our Compensation Committee.


Duy-Loan T. Le, 59 - Director since September 2002; Former Senior Fellow of Texas Instruments, Inc.
Business Experience: Ms. Le retired in July 2017 from Texas Instruments Inc. (“TI”), one of the leading semiconductor companies in the world. Ms. Le was elected Senior Fellow in 2002 and is the only woman in TI’s history elected to this highest Fellow rank. She held various leadership positions at TI, including Advanced Technology Ramp Manager for the Embedded Processing Division and worldwide project manager for the Memory Division. While at TI, Ms. Le led all aspects of execution for advanced technology nodes, including silica technology development, design, assembly and test, productization, qualification, release to market, high volume ramp, and quality and reliability assurance. She has experience opening international offices and developing engineering talent for the TI business. Ms. Le has been awarded 24 patents. She holds a bachelor’s degree in Electrical Engineering from the University of Texas at Austin and a master’s degree in Business Administration from the Bauer College of Business at the University of Houston. Ms. Le is currently a member of the board of directors of Ballard Power Systems, a publicly traded company, and a member of its People, Corporate Governance & Compensation Committee; a member of the board of directors of Wolfspeed, Inc., a publicly traded company, and a member of its Compensation and Governance and Nominations Committees; and a member of the board of directors of Atomera, Inc., a publicly traded company, Chair of its Compensation Committee and a member of its Nominating and Corporate Governance Committee.
The Board concluded that Ms. Le should serve as a director because she has extensive experience managing platform-based product development and is a results-oriented and highly accomplished technology executive with extensive experience in various aspects of semiconductor design and manufacture, including operations, research and development, product launch, customer interfacing, foundry partnership, and supply chain management while at TI. She also managed global R&D centers for TI, and these centers span multiple countries, disciplines, businesses, and organizations across TI. She has over 20 years of process manufacturing experience. These skills and knowledge are relevant for NI’s business. She serves as Chair of our Compensation Committee and a member of our Nomination & Governance Committee.
There is no family relationship between any of our directors, director nominees or executive officers (which we define as those persons designated by the Board from time to time as officers as defined in Rule 16a-1(f) under the Exchange Act, and which we refer to herein as “Executive Officers”).
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the beneficial ownership of NI’s common stock as of the Record Date (i) by all persons known to NI, based on statements filed by such persons pursuant to Section 13(d) or 13(g) of the Exchange Act, to be the beneficial owners of more than 5% of NI’s common stock, (ii) by each of the Named Executive Officers as defined and set forth in the Summary Compensation Table under “Executive Compensation,” (iii) by each director and director nominee, and (iv) by all directors and Executive Officers as a group:
Name of Person or Entity
Number of
Shares of Common
Stock Beneficially
Owned (1)
Approximate
Percentage
Owned (2)
T. Rowe Price Associates, Inc. (3)
100 E. Pratt Street
Baltimore, Maryland 21202
18,978,320
14.37%
The Vanguard Group (4)
100 Vanguard Blvd.
Malvern, Pennsylvania 19355
11,918,198
9.03%
BlackRock, Inc. (5)
55 East 52nd Street
New York, NY 10055
11,218,802
8.50%
Janus Henderson Group PLC (6)
201 Bishopsgate
United Kingdom EC2M 3AE
9,871,803
7.48%
Eric H. Starkloff (7)
179,312
*%
Karen M. Rapp (8)
77,663
*%
Scott A. Rust (9)
32,557
*%
Jason E. Green (10)
55,481
*%
Ritu Favre (11)
17,259
*%
Alexander M. Davern (12)
274,813
*%
Duy-Loan T. Le (13)
116,738
*%
Michael E. McGrath (14)
42,055
*%
Gerhard P. Fettweis (15)
29,139
*%
James E. Cashman, III (16)
16,464
*%
Liam K. Griffin (17)
16,464
*%
Gayla J. Delly (18)
12,038
*%
All Executive Officers and directors as a group (12 persons)(19)
869,983
*%
*
Represents less than 1% of the outstanding shares of our common stock.
(1)
Except as indicated in the footnotes to this table, the persons named in the table have sole voting and investment power with respect to all shares of common stock shown as beneficially owned by them, subject to community property laws where applicable.
(2)
For each individual and group included in the table, percentage owned is calculated by dividing the number of shares beneficially owned by such person or group as described above by the sum of the 132,038,488 shares of common stock outstanding on March 14, 2022, and the number of shares of common stock that such person or group had the right to acquire on or within 60 days of March 14, 2022, including time-based restricted stock units (“RSUs”).
(3)
The information as to beneficial ownership is based on a Schedule 13G/A filed with the SEC on February 14, 2022, reflecting beneficial ownership as of December 31, 2021. The Schedule 13G/A states that T. Rowe Price Associates, Inc. and/or its subsidiaries have sole voting power with respect to 7,395,150 shares of common stock and sole dispositive power with respect to 18,978,320 shares of common stock.
(4)
The information as to beneficial ownership is based on a Schedule 13G/A filed with the SEC on February 10, 2022, reflecting beneficial ownership as of December 31, 2021. The Schedule 13G/A states that The Vanguard Group
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and/or its subsidiaries have shared voting power with respect to 61,472 shares of common stock, sole dispositive power with respect to 11,738,125 shares of common stock and shared dispositive power with respect to 180,073 shares of common stock.
(5)
The information as to beneficial ownership is based on a Schedule 13G/A filed with the SEC on February 1, 2022, reflecting beneficial ownership as of December 31, 2021. The Schedule 13G/A states that BlackRock, Inc. and/or its subsidiaries have sole voting power with respect to 10,740,423 shares of common stock and sole dispositive power with respect to 11,218,802 shares of common stock.
(6)
The information as to beneficial ownership is based on a Schedule 13G/A filed with the SEC on February 10, 2022, reflecting beneficial ownership as of December 31, 2021. The Schedule 13G/A states that Janus Henderson Group PLC and/or its subsidiaries have shared voting power with respect to 9,871,803 shares of common stock and shared dispositive power with respect to 9,871,803 shares of common stock.
(7)
Includes 42,047 shares subject to RSUs which vest within 60 days of March 14, 2022 for Mr. Starkloff.
(8)
Includes 21,569 shares subject to RSUs which vest within 60 days of March 14, 2022 for Ms. Rapp.
(9)
Includes 17,073 shares subject to RSUs which vest within 60 days of March 14, 2022 for Mr. Rust.
(10)
Includes 19,433 shares subject to RSUs which vest within 60 days of March 14, 2022 for Mr. Green.
(11)
Includes 10,876 shares subject to RSUs which vest within 60 days of March 14, 2022 for Ms. Favre and 6,383 shares held by the Ritu Favre Survivor's Trust.
(12)
Includes 4,609 shares subject to RSUs which vest within 60 days of March 14, 2022 for Mr. Davern and 90,000 shares held by the Davern 2021 Irrevocable Trust.
(13)
Includes 4,609 shares subject to RSUs which vest within 60 days of March 14, 2022 for Ms. Le.
(14)
Includes 4,609 shares subject to RSUs which vest within 60 days of March 14, 2022 for Mr. McGrath.
(15)
Includes 4,609 shares subject to RSUs which vest within 60 days of March 14, 2022 for Dr. Fettweis.
(16)
Includes 5,842 shares subject to RSUs which vest within 60 days of March 14, 2022 for Mr. Cashman.
(17)
Includes 5,842 shares subject to RSUs which vest within 60 days of March 14, 2022 for Mr. Griffin.
(18)
Includes 6,095 shares subject to RSUs which vest within 60 days of March 14, 2022 for Ms. Delly.
(19)
Includes 147,213 shares subject to RSUs which vest within 60 days of March 14, 2022 .
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CORPORATE GOVERNANCE
Board Meetings and Committees
The Board held a total of 8 meetings during 2021. The Board has a standing Audit Committee, Compensation Committee, and Nomination & Governance Committee.
During 2021, all directors attended 100% of the meetings of the Board and committees of the Board on which they served, except for Mr. Griffin, who attended less than 75% of such meetings due to a family emergency. NI encourages, but does not require, its Board members to attend NI’s annual meeting of stockholders. In 2021, all of our directors attended our virtual annual stockholder meeting, other than Mr. Griffin, who was absent due to a family emergency, and Mr. Roesslein, who’s term as director expired at such meeting.
Board Leadership Structure
In September 2018, the Board appointed Mr. McGrath, an independent member of the Board, as Chair of the Board. In such role, Mr. McGrath is responsible for coordinating the activities of the Board, chairing all meetings of the Board, developing agendas for such meetings, building a productive relationship between the Board and our President and Chief Executive Officer (“CEO”), and assisting the Board in fulfilling its oversight responsibilities of our strategy, risk oversight and succession planning. The Board believes its current leadership structure best serves the objectives of the Board’s oversight of management, the Board’s ability to carry out its roles and responsibilities on behalf of our stockholders, and our overall corporate governance. The Board also believes that the separation of the Chair and our President and CEO roles allows the President and CEO to focus his time and energy on operating and managing NI, while leveraging the Chair’s experience and perspectives. The Board periodically reviews its leadership structure to determine whether it continues to best serve NI and its stockholders.
Our Board oversees risk management in a number of ways, including the potential impact of COVID-19 and cybersecurity incidents on enterprise risk and crises response. The full Board receives an annual report with respect to our enterprise risk management process, as well as reports on various risk related items at least twice per year and otherwise as relevant, including risks related to our manufacturing operations, cybersecurity, trade compliance, intellectual property, taxes, products, employees, and the continuing impact of the COVID-19 pandemic. The full Board also receives periodic reports on our efforts to manage such risks through safety measures, insurance or self-insurance. The Audit Committee oversees the management of financial and accounting related risks as an integral part of its duties. The Audit Committee also receives reports on ethics and compliance matters quarterly and otherwise as relevant. Similarly, the Compensation Committee considers risk management when setting the compensation policies and programs for our executive officers and other employees.
Communications to the Board of Directors
Stockholders may communicate with any member or members of the Board by mail addressed to the Chair, any other individual member or members of the Board, to the full Board, or to a particular committee of the Board. In each case, such correspondence should be sent to the following address: 11500 North Mopac Expressway, Building B, Austin, Texas 78759, Attention: Corporate Secretary. Correspondence received that is addressed to the members of the Board will be reviewed by our Chief Legal Officer, Senior Vice President and Secretary or his designee, who will forward such correspondence to the appropriate member or members of the Board.
Audit Committee
The Audit Committee, which currently consists of directors Gayla J. Delly (Chair), James E. Cashman, III, Gerhard P. Fettweis, and Michael E. McGrath, met six times during 2021. The Audit Committee appoints, compensates, retains, and oversees the engagement of our independent registered public accounting firm, reviews with such independent registered public accounting firm the plan, scope, and results of their examination of our consolidated financial statements and reviews the independence of such independent registered public accounting firm. The Audit Committee maintains free and open communication with our independent registered public accounting firm and the internal audit department, overseeing the internal audit function and our management team. The Audit Committee inquires about any significant financial risks exposures and assesses the steps management has taken to minimize such exposures to NI, including the adequacy of insurance coverage and the strategy for management of foreign currency risk. The Audit Committee also reviews our compliance with matters relating to environmental, Equal Employment Opportunity Commission and SEC regulations. The Audit Committee has established procedures to
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promote and protect employee reporting of (i) suspected fraud or wrongdoing relating to accounting, auditing or financial reporting matters and (ii) complaints and concerns regarding a violation of the federal securities laws, including (A) receiving, retaining and addressing complaints received by NI relating to such matters, (B) enabling employees to submit on a confidential and anonymous basis any concerns regarding such matters, and (C) protecting reporting employees from retaliation. The Board has determined that each member of the Audit Committee is an “independent director” as that term is defined by the Nasdaq listing standards and Rule 10A-3 of the Exchange Act. The Board has determined that each of Mr. Cashman, Ms. Delly, Dr. Fettweis, and Mr. McGrath is an “audit committee financial expert” within the meaning of SEC rules. The charter of the Audit Committee is available on NI’s website at https://investor.ni.com/corporate-governance.
Nomination & Governance Committee
The Nomination & Governance Committee, which currently consists of directors James E. Cashman, III (Chair), Liam K. Griffin, Duy-Loan T. Le and Michael E. McGrath, met four times during 2021. The Board has determined that each member of the Nomination & Governance Committee is an “independent director” as that term is defined by the Nasdaq listing standards. The Nomination & Governance Committee determines the selection criteria for board members, recommends to the Board compensation of directors (with advice from Compensia, Inc., a national independent compensation consulting firm (“Compensia”), also engaged by the Compensation Committee) and appointment of board committee members and committee chairpersons, and develops board governance principles.
The Nomination & Governance Committee will consider nominees recommended by stockholders provided such recommendations are made in accordance with procedures described in this Proxy Statement under “Deadline for Receipt of Stockholder Proposals.” When considering a potential director candidate, the Nomination & Governance Committee looks for demonstrated character, judgment, relevant business, functional and industry experience, and a high degree of acumen. The Nomination & Governance Committee also considers issues of diversity, such as age, education, gender, professional experience, membership in a minority or underrepresented community, and differences in viewpoints and skills. The Nomination & Governance Committee does not have a formal policy with respect to diversity; however, the Board and the Nomination & Governance Committee believe that it is important that the members of the Board represent diverse viewpoints. The Nomination & Governance Committee’s process for identifying and evaluating nominees typically involves a series of internal discussions, review of information concerning candidates and interviews with selected candidates. There are no differences in the manner in which the Nomination & Governance Committee evaluates nominees for director based on whether the nominee is recommended by a stockholder.
The charter of the Nomination & Governance Committee is available on NI’s website at https://investor.ni.com/corporate-governance.
Compensation Committee
The Compensation Committee, which currently consists of directors Duy-Loan T. Le (Chair), Gayla J. Delly, Gerhard P. Fettweis, and Liam K. Griffin, met six times during 2021. The Board has determined that each member of the Compensation Committee is an “independent director” as that term is defined by applicable SEC rules and the Nasdaq listing standards. The charter of the Compensation Committee is available on our website at https://investor.ni.com/corporate-governance.
Under the terms of its charter, the Compensation Committee evaluates the performance of our Executive Officers, recommends the compensation of our CEO to the independent members of the Board for approval, and establishes the salaries, equity awards, and cash bonus compensation of the other Executive Officers. The Compensation Committee also periodically examines our compensation structure to evaluate whether we are rewarding our Executive Officers and other personnel in a manner consistent with sound industry practices and makes recommendations on such matters to management and our Board. The Compensation Committee also has oversight responsibility for our 2020 Equity Incentive Plan (the “2020 Incentive Plan”), 2015 Equity Incentive Plan (the “2015 Incentive Plan”), 2010 Incentive Plan (the “2010 Incentive Plan”), 2005 Incentive Plan (the “2005 Incentive Plan”), 1994 Employee Stock Purchase Plan, and, if the National Instruments Corporation 2022 Equity Incentive Plan (the “2022 Incentive Plan”) is approved at the Annual Meeting, our 2022 Incentive Plan. The Board may by resolution prescribe additional authority and duties to the Compensation Committee.
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The Compensation Committee has engaged Compensia, an independent national consulting firm, to provide guidance to the committee on compensation matters. When establishing the salaries, equity awards, and cash bonus compensation for the Executive Officers, the Compensation Committee also considers the recommendations of our President and CEO, other than for himself. Our Senior Vice President and Chief People Officer also provides guidance to the Compensation Committee concerning compensation matters as they relate to all Executive Officers. The Compensation Committee works closely with management as required in evaluating the financial, accounting, tax, and retention implications of our various compensation programs. Our Senior Vice President and Chief People Officer regularly attends the meetings of the Compensation Committee and provides advice on compensation matters to the Compensation Committee. Neither our President and CEO nor any of the other Executive Officers participate in deliberations relating to his or her own compensation. Our Compensation Committee recommends to our Board who approves the salary of our President and CEO.
The Compensation Committee’s charter contains provisions providing for the delegation of its duties to the committee chair or any subcommittees when appropriate. The Compensation Committee’s charter also permits the delegation of authority to one or more Executive Officers to make equity grants to employees or consultants who are not directors or Executive Officers.
For a discussion of the Compensation Committee’s utilization of compensation consultants, see “Executive Compensation—Compensation Discussion and Analysis.”
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COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee are set forth in the “Corporate Governance — Compensation Committee” section of this Proxy Statement and do not include any Executive Officers or former Executive Officers. During 2021, no Executive Officer served on the compensation committee (or equivalent), or the board of directors, of another entity whose executive officer(s) served on our Compensation Committee. During 2021, no Executive Officer served on the compensation committee (or equivalent) of another entity whose executive officer(s) served as a member of our Board.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Transactions with Related Persons
NI had no related party transactions requiring disclosure under applicable SEC rules for the year ended December 31, 2021 and has no such related party transaction currently proposed.
Policy and Procedures for Review, Approval, or Ratification of Related Party Transactions
Pursuant to its written charter, the Audit Committee is responsible for reviewing our policies relating to the avoidance of conflicts of interests and past or proposed transactions between NI, members of our Board, and management. We consider “related person transactions” to mean all transactions involving a “related person,” which under SEC rules means an Executive Officer, director or a holder of more than five percent of our common stock, including any of their immediate family members and any entity owned or controlled by such persons. The Audit Committee determines whether the related person has a material interest in a transaction and may approve, ratify, rescind or take other action with respect to the transaction in its discretion.
In any transaction involving a related person, our Audit Committee would consider the available material facts and circumstances of the transaction, including: the direct and indirect interests of the related person; the risks, costs and benefits of the transaction to NI; whether any alternative transactions or sources for comparable services or products are available; and, in the event the related person is a director (or immediate family member of a director or an entity with which a director is affiliated), the impact that the transaction will have on such director’s independence.
After considering such facts and circumstances, our Audit Committee determines whether approval, ratification or rescission of the related person transaction is in our best interests. Our Audit Committee believes that all employees and directors should be free from conflicting interests and influences of such nature and importance as would make it difficult to meet their applicable fiduciary duties and loyalty to NI and reviews all related party transactions against the foregoing standard.
Our written policies and procedures for review, approval or ratification of transactions that pose a conflict of interest, including related person transactions, are set forth in our Code of Ethics, which contains, among other policies, a conflicts of interest policy for all employees, including our Executive Officers, and a conflicts of interest policy for non-employee directors.
Under our written conflicts of interest policy applicable to all employees, including our Executive Officers, our employees are required to disclose to our legal department any relationship, association, activity, or other circumstance or situation that could create a conflict of interest. In addition, employees, including our Executive Officers, are required to disclose to our legal department enumerated facts related to certain (1) financial interests held in entities that do business with or compete against NI; (2) outside services provided to persons or entities that do business with or compete against NI; (3) participation in a decision on behalf of NI that relates to business with a family member or close personal relation; and (4) loans offered by or accepted from persons or entities that do business with or compete against NI. While we provide examples of potential conflicts of interest, the policy expressly states that examples are illustrative only and each employee should report any circumstance which could be construed to interfere actually or potentially with loyalty to NI. Potential conflicts of interests disclosed pursuant to the conflicts of interest policy for employees are reviewed first by the legal department and then resolved with the assistance of legal counsel, as appropriate. Resolutions of these disclosures require the approval of (1) an organizational Vice President, where a disclosure involves a subordinate employee within his or her organization (except in the case of voluntarily disclosed situations for which the legal department found no conflict), (2) our President and Chief Executive Officer and Chief Legal Officer, where a disclosure involves an employee with the organizational title of Vice President or above, excluding employees designated as Executive Officers, or (3) the Audit Committee, where a disclosure involves an Executive Officer (except that our President and Chief Executive Officer and Chief Legal Officer can resolve
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(x) voluntarily disclosed situations for which the legal department found no conflict and (y) cases where the disclosure was rejected). Our Chief Legal Officer reports disclosures to the Audit Committee where: (a) the disclosure was resolved through an acceptance or conditional acceptance of the conflict, where the subject of the disclosure is an employee with an organizational title of Vice President or above; or (b) the disclosure was resolved (irrespective of how it was resolved), where the subject of the disclosure is our President and Chief Executive Officer or another Executive Officer.
The written conflicts of interest policy applicable to all non-employee directors provides that every non-employee director is required to report potential conflict of interest situations to the legal department. The legal department will recommend a resolution. Resolutions require the approval of the Audit Committee (except in the case of voluntarily disclosed situations for which the legal department found no conflict). The policy does not require reporting of financial interests in an entity that does business with or competes against NI if the entity is publicly traded, and the non-employee director owns less than 5% of the securities of the entity and is not an executive officer or member of the board of directors of such entity. It also does not require reporting of compensation for services to an entity that does significant business with or competes against NI if the compensation (a) relates only to services rendered by the non-employee director in his or her capacity as an employee, consultant, director, or trustee; (b) totaled less than $100,000 for the preceding year; and (c) is anticipated to total less than $100,000 for the current year.
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BOARD COMPENSATION
Determining Compensation for Non-Employee Directors in 2021
The Board, upon the recommendation of the Nomination & Governance Committee, sets non-employee director compensation with the goal of retaining members of our Board and attracting qualified persons to serve as members of our Board. In developing its recommendations, the Nomination & Governance Committee consults with Compensia, an independent national compensation consulting firm engaged by our Nomination & Governance Committee, to advise on compensation matters. The Nomination & Governance Committee considers director compensation at comparable publicly traded companies and aims to structure director compensation in a manner that is transparent and easy for stockholders to understand.
The compensation of non-employee members of the Board for the fiscal year ended December 31, 2021 is set forth in the table below.
DIRECTOR COMPENSATION
FOR FISCAL YEAR ENDED DECEMBER 31, 2021
Name
Fees
Earned or
Paid in
Cash
Stock
Awards
(1)
Total
James E. Cashman, III
$88,867
$204,087
$292,954
Alexander M. Davern
67,500
204,087
271,587
Gayla J. Delly
96,822
204,087
300,909
Gerhard P. Fettweis
85,000
204,087
289,087
Liam K. Griffin
80,000
204,087
284,087
Duy-Loan T. Le
92,500
204,087
296,587
Michael E. McGrath
186,120
204,087
390,207
Charles J. Roesslein (2)
35,200
35,200
(1)
The amounts included in the table for stock awards represent the aggregate grant date fair value of awards made during 2021, as computed in accordance with ASC 718. The grant date fair value of each award is expensed monthly based on the estimated vesting period of the corresponding grant. Grant date fair value is calculated using the closing price of the day immediately preceding the date of grant multiplied by the number of RSUs granted. On April 21, 2021, Mr. Cashman, Mr. Davern, Ms. Delly, Dr. Fettweis, Mr. Griffin, Ms. Le, and Mr. McGrath were each granted 4,609 RSUs (the “2021 Director Grants”); Mr. Roesslein was not granted any RSUs during 2021. The grant date fair value of each 2021 Director Grant was based on the April 20, 2021 closing price of $44.28 per share, and all 2021 Director Grants vest on May 1, 2022, which is the one-year anniversary of the vesting commencement date. As of December 31, 2021, Mr. Davern, Dr. Fettweis, Ms. Le, and Mr. McGrath, each had 4,609 outstanding and unvested RSUs. As of December 31, 2021, Mr. Cashman and Mr. Griffin each had 5,842 outstanding and unvested RSUs. As of December 31, 2021, Ms. Delly had 7,580 outstanding and unvested RSUs. As of December 31, 2021, Mr. Roesslein had no outstanding and unvested RSUs.
(2)
Mr. Roesslein retired on May 11, 2021.
Discussion of Director Compensation
The 2021 annual compensation for our non-employee directors was comprised of cash compensation in the form of an annual retainer, committee chair retainer, committee membership retainer, independent board chair retainer and equity compensation in the form of RSUs. Each of these components is described below. Employee members of our Board do not receive any additional compensation for service as a member of the Board. Accordingly, Mr. Starkloff did not receive any compensation for his service on the Board in 2021.
Annual Board/Committee Retainer Fees
For 2021, our non-employee directors received cash compensation for membership on the Board and committees, committee chair positions, and the independent Board chair position. Specifically, during 2021 non-employee directors received an annual cash retainer of $67,500 (based on a prorated amount of the
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$60,000 annual retainer applicable to the first quarter of 2021 and a prorated amount of the $70,000 annual retainer applicable to the last three quarters of 2021), plus annual retainers for committee memberships in the following amounts: $10,000 for membership on the Audit Committee, $7,500 for membership on the Compensation Committee, and $5,000 for membership on the Nomination & Governance Committee. In addition, the chairpersons of the Audit Committee, Compensation Committee and Nomination & Governance Committee received additional annual retainers of $28,750 (based on a prorated amount of the $25,000 annual fee applicable to the first quarter of 2021 and a prorated amount of the $30,000 annual fee applicable to the last three quarters of 2021), $20,000 and $15,000 annual fee, respectively. The independent Board chair receives an additional $100,000 per year for his service. All cash compensation is paid in quarterly installments.
The Board, in its discretion, may pay an overnight meeting fee or special meeting fee for extended meetings, not to exceed $2,000 per day. Employee members of our Board do not receive any additional compensation for service as a member of our Board.
Non-Employee Director Reimbursement Practice
Non-employee members of our Board are reimbursed for travel and other out-of-pocket expenses connected to service as a member of our Board.
Restricted Stock Unit Awards
Non-employee members of our Board are eligible to receive single annual grants of RSUs under our equity incentive plans in amounts determined by the Nomination & Governance Committee. On April 21, 2021, each non-employee member of our Board received an annual grant of RSUs equal to $204,087 (based on the 30-trading day average of the closing price of our common stock ending on the day immediately preceding the date of grant) with one-year vesting. Mr. Cashman, Mr. Davern, Ms. Delly, Dr. Fettweis, Mr. Griffin, Ms. Le, and Mr. McGrath were each granted 4,609 RSUs as part of the 2021 Director Grants under our 2020 Incentive Plan. The grant date fair value of each 2021 Director Grant was based on the closing price of our common stock on April 20, 2021 of $44.28 per share. The 2021 Director Grants vest on May 1, 2022.
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EXECUTIVE OFFICERS
The following table sets forth information concerning the persons currently serving as Executive Officers of NI, including information as to each Executive Officer’s current age, position with NI, and business experience. Executive Officers of NI serve at the discretion of the Board.
Name of Executive Officer
Age
Position
Eric H. Starkloff
47
President and Chief Executive Officer
Karen M. Rapp
54
Executive Vice President and Chief Financial Officer
Jason E. Green
49
Executive Vice President & GM, Portfolio BU and Chief Revenue Officer
Scott A. Rust
55
Executive Vice President, Platform & Technology
Ritu Favre
53
Executive Vice President & GM, Business Units
See “Proposal One: Election of Directors” for additional information with respect to Mr. Starkloff.
Karen M. Rapp joined NI in May 2017 and currently serves as Executive Vice President and Chief Financial Officer. Prior to February 1, 2021, Ms. Rapp also served as our Treasurer. Prior to joining NI, Ms. Rapp served as Senior Vice President of Corporate Development of NXP Semiconductors N.V. (“NXP”), a Dutch global semiconductor manufacturer, after NXP acquired Freescale Semiconductor in December 2015. Prior to NXP's acquisition, Ms. Rapp worked at Freescale beginning in April 2010 and held several leadership positions at Freescale with increasing responsibility, including Vice President and Chief Information Officer, Director of Operations and Finance, Global Sales and Marketing, Director of Finance, Supply Chain and Director of Finance, Continuous Development. Ms. Rapp holds a bachelor’s degree in Finance from Northern Illinois University and a master’s degree in Business Administration from the University of Texas at Austin. Ms. Rapp currently serves as a director of Plexus Corp. and Microchip Technology, Incorporated, both publicly traded companies.
Jason E. Green joined NI in September 2015 and currently serves as Executive Vice President & GM, Portfolio BU and Chief Revenue Officer. He previously served as Senior Vice President, Global Sales, Support, Services, and Operations from January 2019 to January 2021. He previously served as Senior Vice President, Global Sales from May 2018 to December 2018 and as Vice President, Regional Sales, Americas from September 2015 to April 2018. Prior to joining NI, Mr. Green worked at Maxim Integrated Products, Inc. from 1995 to 2015 where he served as Vice President of Americas sales and applications and was responsible for many of the company’s largest global customers. Mr. Green holds a bachelor’s degree in Business Administration with a minor in Economics from the University of Florida.
Scott A. Rust joined NI in 1990 and currently serves as Executive Vice President, Platform & Technology. He previously served as NI’s Executive Vice President, Platform & Product from October 2021 to January 2022; as NI’s Senior Vice President, Global Research & Development from February 2014 to October 2021; as NI’s Vice President of Research and Development Test Systems from July 2013 to January 2014; as NI’s Vice President of Research and Development in Penang, Malaysia from January 2011 to July 2013; as Vice President of Research and Development of Modular Instruments from October 2008 to December 2010; as Director of Modular Instruments from March 2003 to September 2008; as Software Section Manager from October 2000 to March 2003; as Group Manager from October 1996 to October 2000; as Marketing Manager of Test and Measurement Software from August 1991 to September 1996; and as Applications Engineer from June 1990 to July 1991. Mr. Rust received his bachelor’s degree in Electrical Engineering from Texas A&M University.
Ritu Favre joined NI in July 2019. In January 2022, Ms. Favre was promoted to the position of Executive Vice President & GM, Business Units. She previously served as NI’s Executive Vice President and General Manager of the Semiconductor and Electronics, Aerospace, Defense, and Government, and Transportation Business Units from January 2021 to January 2022; and as NI’s Senior Vice President and General Manager of the Semiconductor Business Unit from July 2019 to January 2021. Prior to joining NI, Ms. Favre worked as Chief Executive Officer at NEXT Biometrics from February 2017 to July 2019. From May 2014 to October 2016, Ms. Favre served as Senior Vice President and GM of the Biometrics Products Division at Synaptics, Inc. and served in various roles at Motorola and Freescale Semiconductor from June 1988 to May 2014, including Senior Vice President and General Manager for RF from September 2012 to May 2014. Ms. Favre has served on the board of directors of Valmont Industries since September 2020 and previously served on the board of directors of Cohu, Inc., from January 2019 to May 2019. Ms. Favre holds a BS in Electrical Engineering and a Masters in Electrical Engineering from Arizona State University.
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EXECUTIVE COMPENSATION
COMPENSATION DISCUSSION AND ANALYSIS
This Compensation Discussion and Analysis provides information regarding the 2021 compensation program for our principal executive officer, our principal financial officer, and the three Executive Officers (other than our principal executive officer and principal financial officer) at the end of fiscal year 2021 who were our most highly compensated Executive Officers (collectively, our “Named Executive Officers” or “NEOs”). The following discussion and analysis should be read in conjunction with the compensation tables starting on page 37 of this Proxy Statement. For 2021, our Named Executive Officers were, with their current titles, as applicable:
Eric H. Starkloff, President and Chief Executive Officer (our “President and CEO”);
Karen M. Rapp, Executive Vice President and Chief Financial Officer;
Jason E. Green, Executive Vice President & GM, Portfolio BU and Chief Revenue Officer;
Scott A. Rust, Executive Vice President, Platform & Technology; and
Ritu Favre, Executive Vice President & GM, Business Units.
Executive Summary
This Compensation Discussion and Analysis outlines the material elements of our 2021 executive compensation program, provides an overview of our executive compensation philosophy, including our principal compensation policies and practices, and describes specific compensation decisions made during 2021 by our Compensation Committee for our Named Executive Officers, including the key factors that the Compensation Committee considered in determining our Named Executive Officers’ compensation.
2021 Business Highlights
We experienced strong demand for our products throughout 2021 and continued to focus on driving efficiencies across our business. Despite some disruptions from global supply chain constraints, we were able to achieve record revenue and the highest non-GAAP operating income in more than 20 years.
Revenue: We reported net sales of $1.5 billion, an all-time record and a 14 percent increase from 2020.
Cash Generation: We generated annual cash flow from operations of $143 million. As of December 31, 2021, we held $211 million in cash and cash equivalents.
Capital Deployment: In 2021, we returned over $198 million to our stockholders through dividends and stock repurchases. We also completed the acquisition of several companies for total consideration of $223 million, net of cash received. These acquisitions are intended to accelerate our investments in key focus areas including vehicle electrification.
Product Portfolio: We continued to sharpen our focus on system-level automated test and automated measurement offerings in key growth areas, including semiconductor, transportation, and aerospace, defense, and government.

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Say-on-Pay Vote and Performance-Based Restricted Stock Unit Awards
At our 2021 Annual Meeting of Stockholders, approximately 92% of the votes present and entitled to vote on the advisory vote for Named Executive Officer compensation (also known as the “Say-on-Pay” vote) voted in favor of the compensation of our Named Executive Officers. We view the Say-on-Pay vote as an opportunity to receive feedback from our stockholders about our executive compensation program. As set forth in more detail in the Introduction to this Proxy Statement, prior to our annual meetings of stockholders, we reach out to our major stockholders and engage with them on their views and concerns about our policies and practices, including our executive compensation.
During 2021, the Compensation Committee made no material changes to the structure of the total direct compensation paid to our Named Executive Officers. See the Introduction to this Proxy Statement for additional information about our stockholder engagement.
2021 Executive Compensation Highlights
In 2021, the Compensation Committee took the following actions with respect to the compensation of our Named Executive Officers:
Entered into Employment Agreements with Four of our Named Executive Officers such that each Named Executive Officer has a double-trigger compensation arrangement in connection with a change in control – The Compensation Committee approved, and we entered into, employment agreements (including “double-trigger” change in control provisions) with each of Ms. Favre, Mr. Green, and Ms. Rapp in February 2021 and with Mr. Rust in September 2021. See “Potential Payments Upon Termination or Change of Control” below for more information.
Established Named Executive Officer Base Salaries – Approved annual base salary increases for some of our Named Executive Officers ranging from 3% to 5%. One Named Executive Officer’s base salary remained unchanged for 2021.
Established Named Executive Officer Executive Incentive Program (“EIP”) Targets – For our Named Executive Officers, other than our President and CEO, approved the key company financial and operational performance objectives, pre-established performance levels for each objective, and related payout levels (expressed as a percentage that increases or decreases with company performance) for cash incentive bonus opportunities pursuant to the EIP, and approved target cash incentive bonus opportunities ranging from 65% to 100% of the Named Executive Officer’s 2021 annual base salary, which, if paid at target, would result in an EIP payout for these Named Executive Officers of $307,344 to $480,000. Our Board, based on the recommendations of the Compensation Committee, approved the same EIP key company financial and operational performance objectives for Mr. Starkloff, our President and CEO. Our Board approved, at the recommendation of the Compensation Committee, a target cash incentive bonus opportunity equal to 135% of Mr. Starkloff’s 2021 annual base salary, which, if paid at target, would result in an EIP payout of $992,250. Mr. Rust’s target cash incentive bonus opportunity increased from 65% of his base salary during the first three quarters of 2021 to 100% for the fourth quarter, in connection with his promotion effective October 1, 2021, resulting in a blended annual target opportunity of 74% of his base salary. See “Executive Incentive Program below for more information regarding the EIP, including actual payouts for 2021.
Granted Named Executive Officer Equity Awards – Granted equity awards in the form of 50% restricted stock units (“RSUs”) and 50% performance restricted stock units (“PRSUs”) to be settled for shares of our common stock, in amounts ranging from target levels of $750,000 to $1,800,000, to our Named Executive Officers, other than our President and CEO, and an equivalent of $5,000,000 (40% RSUs and 60% PRSUs) to our President and CEO.
Pay-for-Performance Discussion
Our 2021 executive compensation program consisted of base salary, the EIP in the form of an annual cash bonus opportunity, and long-term incentive compensation opportunities in the form of RSUs and PRSUs. The EIP metrics and payouts are closely linked to stockholder value creation through the achievement of our short-term and long-term financial, operational, and strategic objectives.
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The 2021 pay mix for our President and CEO and our other Named Executive Officers was predominantly variable or “at risk.” As the following charts illustrate, the intended target value of equity and cash awards for 2021 was 89% of our President and CEO’s target total direct compensation (defined as the sum of his 2021 base salary and target annual cash bonus opportunities under the EIP, and the intended target value of his equity awards), and 79% of our other Named Executive Officers’ average target total direct compensation, delivered in the form of variable or “at risk” compensation.

Further, 59% of our President and CEO’s target total direct compensation was tied to the achievement of pre-established, rigorous financial and market goals through the EIP bonus and PRSUs, as was 49% of the average target total direct compensation of our other Named Executive Officers. We believe this distribution of compensation, which depends on the Company's performance, aligns our Named Executive Officer’s interests with those of our shareholders.
In addition, long-term incentive compensation in the form of either RSUs or PRSUs represented 74% of our President and CEO’s target total direct compensation and 60% of the average target total direct compensation of our other Named Executive Officers.
Based on feedback we received from our stockholders in prior years and through our own due diligence and benchmarking, PRSU awards represent 50% of the equity award value awarded to our Named Executive Officers (other than our President and CEO), while the other 50% consist of RSU awards. For our President and CEO, PRSUs represent 60% of the equity award value, while RSUs represent 40%. We have received favorable stockholder feedback with respect to granting PRSUs with relative metrics such as total shareholder return (“TSR”). We believe that our use of performance-based long term incentive compensation is important to strengthening the alignment between our Named Executive Officers’ compensation and creation of stockholder value, while also driving the achievement of our financial and operational goals.
Executive Compensation Policies and Practices
We endeavor to maintain sound governance standards consistent with our executive compensation policies and practices. The Compensation Committee evaluates our executive compensation program on a regular basis to ensure that it is consistent with our short-term and long-term goals of driving revenue and profitable growth for the Company, given the dynamic nature of our business and the market in which we compete for executive talent. The following summarizes our executive compensation and related policies and practices:
What We Do
Maintain an Independent Compensation Committee. The Compensation Committee consists solely of independent directors who establish our compensation practices.
Retain an Independent Compensation Advisor. The Compensation Committee has engaged its own compensation consultant to provide information, analysis, and other advice on executive compensation independent of management.
Annual Executive Officer Compensation Review. At least once a year, the Compensation Committee conducts a review of our Executive Officer compensation strategy.
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Compensation At-Risk. Our executive compensation program is designed so that a significant portion of our Named Executive Officers’ compensation is “at risk” based on corporate performance, because it is equity-based, to align the interests of our Named Executive Officers and to those of our stockholders.
Annual Compensation-Related Risk Assessment. We consider our compensation-related risk profile to ensure that our compensation-related risks do not create inappropriate or excessive risk and are not likely to have a material adverse effect on NI.
Stock Ownership Policy. We have adopted stock ownership guidelines for our Executive Officers and the non-employee members of our Board under which they must accumulate and hold, consistent with the terms of the guidelines, a number of shares of common stock equivalent to a multiple of their annual salary or retainer, as applicable.
“Double-Trigger” Compensation Arrangements in Connection with a Change in Control for Our Named Executive Officers. In the event of a Change in Control (as defined in their respective employment agreements) of NI, our Named Executive Officers would not receive compensation severance benefits pursuant to their employment agreement unless there is both (i) a Change in Control of NI and (ii) an involuntary termination of employment or resignation for Good Reason (also as defined in their respective employment agreements) within a certain time frame. See “Potential Payments Upon Termination or Change in Control” below for more information on our Named Executive Officer’s Change in Control benefits.
“Clawback” Policy. We have adopted a “clawback” policy (the “Clawback Policy”) applicable to any current and former Executive Officers, which enables the Compensation Committee to recoup excess incentive compensation awarded after January 1, 2022 in the event of certain financial statement restatements caused by an Executive Officer’s fraud, intentional misconduct or gross negligence. See “Other Compensation Policies – Compensation Clawback Policy” below for further information on the Clawback Policy.
What We Do Not Do
No Guaranteed Bonuses. We do not provide guaranteed bonuses to our Named Executive Officers.
No Special Retirement Plans. We do not currently offer, nor do we have plans to offer, defined benefit pension plans or any non-qualified deferred compensation plans or arrangements to our Named Executive Officers other than the plans and arrangements that are available to all employees. Our Named Executive Officers are eligible to participate in our Section 401(k) retirement savings plan on the same basis as our other employees.
No Short Selling, Hedging or Derivatives Transactions. We have a policy which prohibits short selling or trading in derivatives of our securities. In addition, those subject to the company quarterly blackout window are prohibited from holding our securities in margin accounts or engaging in hedging or similar transactions with respect to our securities.
No Excise Tax Payments on Future Post-Employment Compensation Arrangements. We do not provide any excise tax reimbursement payments (including “gross-ups”) on payments or benefits contingent upon certain terminations of employment or a change in control of NI.
No Special Welfare or Health Benefits. We do not provide our Named Executive Officers with any welfare or health benefit programs, other than participation in our broad-based employee programs and an annual physical.
No Special Perquisites. We do not provide significant perquisites or other personal benefits to our Named Executive Officers.
Compensation Philosophy and Objectives
Our executive compensation philosophy is based on the concept of pay for performance and is aligned with the following primary goals:
Our compensation practices are designed to support the interests of our stockholders.
Achieving financial goals and other operational targets that drive the profitable growth of the Company is the basis for measuring performance.
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Sufficient upside, in the form of the potential to earn more than the target amount, and downside, in the form of risk of not earning the full target amount, including zero, are built into our incentive plans to deliver appropriate rewards based on Company results.
Based on this philosophy, our executive compensation program is guided by the following overarching principles:
Business Driven: Compensation should be aligned to our performance by linking rewards directly to the achievement of specific and challenging financial, operational, and strategic objectives that are expected to lead to increased stockholder value and executive retention and engagement.
Performance Differentiated: Compensation should be structured to create an effective link between pay and performance at both the corporate and individual level so that the contributions of our Executive Officers are valued and rewarded.
Market Competitive: Compensation should be competitive to attract, retain, and motivate Executive Officers needed to achieve our core strategic vision.
No Excessive Dilution: We believe that our overall reliance on equity awards should be related to our company performance, and that the use of equity awards must be sensitive to the dilutive impact that such equity compensation will have on our stockholders.
We also maintain a strong focus on leadership development and retention, and as such, our executive compensation program is designed to ensure that we attract and retain the talent required to execute our business strategy. The compensation actions and decisions for our Named Executive Officers support our talent retention objectives by considering individual contributions to our performance, long-term potential and holding power, and organizational succession plans.
We regularly assess and adjust our executive compensation program, policies, and practices in light of these overarching principles and, in doing so, consider feedback obtained through our stockholder engagement efforts.
Compensation-Setting Process
Role of Compensation Committee
The Compensation Committee, which is composed entirely of independent directors, is responsible for reviewing and approving the compensation of our Named Executive Officers, other than for our President and CEO. The independent members of our Board review and approve the recommendations of the Compensation Committee with respect to the compensation of our President and CEO. The Compensation Committee’s decisions are subject to any approval of our Board that the Compensation Committee or legal counsel determines to be desirable or is required by applicable law or Nasdaq rules. Specifically, the Compensation Committee oversees our executive compensation plans, administers our equity compensation plans, and reviews and approves the compensation of our Executive Officers. With respect to the compensation of our President and CEO, the Compensation Committee recommends such compensation to the independent directors of the Board, who also separately approve it.
The Compensation Committee operates under a written charter adopted by our Board. A copy of the charter is posted on the investor relations section of our website located at https://investor.ni.com/corporate-governance.
As described in greater detail in the next section, the Compensation Committee considers both company performance and individual performance when determining the overall compensation levels for our Named Executive Officers, as well as the individual elements of compensation. For example, our EIP cash incentive program is designed to incentivize our Executive Officers to achieve identified company key objectives, which are financial and operational metrics, and ensure that our company’s performance impacts the amounts payable to participants. The Compensation Committee believes that the various elements of executive compensation should work together to promote our objective that total compensation be related both to company and individual performance.
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Setting Total Direct Compensation
The Compensation Committee (and in the case of our President and CEO, the independent members of our Board, upon the recommendation of the Compensation Committee) does not establish a specific target for the total direct compensation opportunity of our Named Executive Officers. In making decisions about the compensation of our Named Executive Officers, the Compensation Committee (and in the case of our President and CEO, the independent members of our Board, upon the recommendation of the Compensation Committee) relies primarily on the general business acumen and experience of its members and subjective consideration of various factors, including the following:
our executive compensation program objectives;
our performance against the financial, operational, and strategic objectives established by the Compensation Committee and our Board;
each individual Named Executive Officer’s knowledge, skills, experience, qualifications, and tenure relative to other similarly situated executives at the companies in our compensation peer group and/or selected broad-based compensation surveys;
the scope of each Named Executive Officer’s role and responsibilities compared to other similarly situated executives at the companies in our compensation peer group and/or selected broad-based compensation surveys;
the prior performance of each individual Named Executive Officer, based on a subjective assessment of his or her contributions to our overall performance, ability to lead his or her business unit or function, and work as part of a team, all of which reflect our core values;
the potential of each individual Named Executive Officer to contribute to our long-term financial, operational, and strategic objectives;
the business risk presented to us in the event the Named Executive Officer were to leave our employ;
our President and CEO’s compensation relative to that of our Named Executive Officers, and compensation parity among our Named Executive Officers;
general compensation trends and practices in the technology industry and broader U.S. market;
the compensation practices of comparable companies, including our compensation peer group and the positioning of each Named Executive Officer’s compensation in a ranking of peer company compensation levels based on an analysis of competitive market data conducted by the Compensation Committee’s independent compensation consultant as well as our in-house compensation experts; and
the recommendations of our President and CEO with respect to the compensation of our Named Executive Officers (other than his own compensation).
These factors provide the framework for compensation decision-making and final decisions regarding the compensation opportunity for each Named Executive Officer. No single factor is determinative in setting compensation levels, nor is the impact of any individual factor on the determination of pay levels quantifiable.
The Compensation Committee does not weigh these factors in any predetermined manner, nor does it apply any formulas in developing its compensation decisions. The members of the Compensation Committee consider all of this information in light of their individual experience, knowledge of NI, knowledge of the competitive market, knowledge of each Named Executive Officer, and business judgment in making these decisions.
Role of Management
In establishing our executive compensation program, the Compensation Committee works closely with our senior management, including our President and CEO and our Senior Vice President and Chief People Officer. In 2021, the Compensation Committee obtained input from our President and CEO when discussing the performance of, and compensation levels for, our Named Executive Officers (other than himself). The Compensation Committee also worked closely with our President and CEO and our Senior Vice President and Chief People Officer and others, as
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required, in evaluating the financial, accounting, tax, talent management/succession planning, and retention implications of our executive compensation program and its various elements. Neither our President and CEO nor any of our other Named Executive Officers are present when their own compensation is being discussed by the Compensation Committee.
Role of Compensation Consultant
The Compensation Committee has engaged Compensia as its independent compensation consultant to advise on executive compensation matters. In 2021, at the direction of the Compensation Committee, Compensia conducted various projects, including performing a comprehensive review of our executive compensation program, performing a review of the compensation program for our Board on behalf of the Nomination and Governance Committee, assisting the Compensation Committee in updating our compensation peer group and benchmarking, and assisting in the preparation of the executive compensation disclosure for our 2021 proxy statement. Compensia did not provide any other services for us in 2021.
The Compensation Committee has evaluated its relationship with Compensia to ensure that it believes that such firm is independent from management. This review process included a review of the services that such compensation consultant provided, the quality of those services and the fees associated with the services provided during 2021.
Based on this review, as well as consideration of the factors affecting independence set forth in the listing standards of Nasdaq and the relevant SEC rules, the Compensation Committee has determined that no conflict of interest was raised by Compensia's work and that Compensia met the independence requirements of such rules.
Competitive Positioning
In making its compensation decisions for 2021, the Compensation Committee reviewed a competitive market analysis based on a compensation peer group, including (1) compensation data collected from publicly available information contained in the SEC filings from 17 selected peer group companies, and (2) data from a customized cut of the Radford Global Technology Survey, which included 14 of the 17 peer companies. Where insufficient data was available for a specific position for our peer group, the Compensation Committee looked at data from the general Radford Global Technology survey focusing on publicly traded technology companies with annual revenues ranging from $1 billion to $3 billion.
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Based on the recommendation of its independent compensation consultant, the Compensation Committee adjusted our peer group companies for 2021 and determined to (1) remove from the current peer group Cypress Semiconductor due to its acquisition by Infineon and (2) add to the peer group Nuance Communications and Citrix Systems to increase the representation of software companies. The peer group data the Compensation Committee reviewed are as follows:
Company Name
Annual
Revenue
(in millions)
(last four quarters)
Market
Capitalization (1)
(in millions)
ANSYS
1,504
23,553
Cadence Design Systems
2,378
24,892
Cirrus Logic
1,281
4,055
Citrix Systems
3,152
17,593
Cognex
719
9,986
Keysight Technologies
4,197
19,050
MKS Instruments
1,972
5,763
Novanta
624
3,576
Nuance Communications
1,854
6,266
OSI Systems
1,197
1,346
PTC
1,346
8,685
Silicon Laboratories
864
4,184
Synopsys
3,400
26,543
Teledyne Technologies
3,203
12,636
Teradyne
2,505
11,493
Trimble
3,255
10,173
Viavi Solutions
1,159
2,769
Financial data per S&P Capital IQ as of 6/22/2020.
(1)
30-day average.
The Compensation Committee used the specific compensation data described above to assess the reasonableness and competitiveness of the compensation packages as a whole for our Named Executive Officers but exercised its judgment in allocating compensation among our Named Executive Officers and among the various elements of each individual Named Executive Officer’s total compensation package.
The Compensation Committee believes that total compensation at or around the 50th percentile of the competitive market (based on the compensation data evaluated) is the appropriate reference when determining the compensation of our Named Executive Officers. Though the Compensation Committee uses the 50th percentile as a reference point, it does not target a specific percentile in the range of comparative information for each individual Named Executive Officer or for each element of compensation. Instead, the Compensation Committee structures the total compensation package for each Named Executive Officer after consideration of the comparative market data and the other factors described above under “Setting Total Direct Compensation.”
Elements of Executive Compensation
The principal elements of our executive compensation program for 2021 were as follows:
Base salary;
EIP for cash bonus opportunities; and
Long-term incentive compensation in the form of equity awards.
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Base Salary
Base salary represents the fixed portion of the compensation of our Named Executive Officers and is an important element of compensation intended to attract and retain highly talented individuals. We use base salary to provide each Named Executive Officer with a competitive level of cash compensation during the year with the expectation that he or she will perform his or her responsibilities to the best of his or her ability and in our best interests.
Generally, we establish the initial base salaries of our Named Executive Officers at the time we hire or promote the individual Named Executive Officer, taking into account his or her position, qualifications, experience, salary expectations, external market data, and the base salaries of our other Executive Officers. Thereafter, the Compensation Committee reviews the base salaries of our Executive Officers annually, with input from our President and CEO (except with respect to his own base salary) and makes adjustments as it determines to be reasonable and necessary to reflect the scope of an Executive Officer’s performance, individual contributions and responsibilities, position in the case of a promotion, and market conditions. The Compensation Committee does not use a specific formula, but instead the committee members exercise their judgment in view of our compensation philosophy and objectives.
In January and February 2021, the Compensation Committee reviewed the base salaries of our Named Executive Officers, taking into consideration a competitive market analysis prepared by Compensia and the recommendations of our President and CEO (other than with respect to his own salary), as well as the other factors set forth above and described in the Compensation Discussion and Analysis, under the heading “Compensation-Setting Process” and sub-heading “Setting Total Direct Compensation.” Base salary increases that took effect in 2021 for our Named Executive Officers are as follows:
Named Executive Officer (1)
2020 Base
Salary (2)
2021 Base
Salary
Percentage
Adjustment
Eric H. Starkloff
$700,000
$735,000
5%
Karen M. Rapp
458,916
480,000
4.6%
Scott A. Rust
400,400
412,500 (3)
3%
Jason E. Green
575,000
575,000
0%
(1)
Ms. Favre became a Named Executive Officer in 2021 and is therefore excluded from the above table.
(2)
Reflects the annual salary approved by the Compensation Committee and, as applicable, the independent members of our Board. In 2020, Mr. Starkloff, our President and CEO, in response to the economic impact of the COVID-19 pandemic on our business, voluntarily reduced his base salary by 20% and the other Named Executive Officers voluntarily reduced their base salaries by 10%. These voluntary reductions were in effect for the period of May 1, 2020 through September 30, 2020. None of these voluntary actions were at the request of the Compensation Committee.
(3)
Base salary approved for Mr. Rust as of January 19, 2021. Mr. Rust’s base salary was increased to $425,000 upon his promotion to Executive Vice President, Platform & Product, pursuant to his employment agreement with the Company, effective as of October 1, 2021.
The actual base salaries paid to our Named Executive Officers in 2021 are set forth in the “2021 Summary Compensation Table” below.
Executive Incentive Program
The EIP is intended to promote company performance (and, thereby, increase stockholder value) by providing our Executive Officers with the opportunity to earn cash payouts based on their level of attainment of three key pre-established corporate financial and operational objectives. Every calendar year the Compensation Committee sets key corporate objectives that it considers critical to the Company’s performance during such calendar year. For 2021, these key corporate objectives, which were set during the first quarter of the year, were:
non-GAAP organic revenue growth (excluding any acquisitions or dispositions by NI) (“Revenue Growth”);
non-GAAP operating margin levels based on organic results (“Operating Margin”); and
revenue from software and software-related services (“Software Revenue”).
Refer to Annex I for a reconciliation of the non-GAAP financial measures.
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After selecting these key corporate objectives, except as noted below, the Compensation Committee, and in the case of Mr. Starkloff, the independent members of our Board, based on the recommendations of the Compensation Committee, set: (1) the weighting of the key corporate financial and operational objectives for each Named Executive Officer, (2) the target cash incentive bonus opportunity for each Named Executive Officer, expressed as a percentage of his or her base salary, and (3) the different EIP payout levels based on our actual performance for each key corporate financial and operational objective, expressed as a percentage of payout which increased or decreased with company performance.
The key corporate financial and operational objectives were weighted as follows: 50% of any payout was dependent on achieving pre-established Revenue Growth objectives, 30% of any payout was dependent on achieving pre-established Operating Margin objectives, and 20% of any payout was dependent on achieving Software Revenue objectives.
After the end of the year, the payout amount for the actual level of achievement of each key corporate financial and operational objective was determined by the Compensation Committee. The Operating Margin payout is approved by the Compensation Committee based on performance after adjusting the Operating Margin for actual annual cash incentive compensation expenses and associated payroll taxes versus related estimated expenses and taxes used when establishing the EIP payout slope. The Compensation Committee then approved the EIP payout amount for each Named Executive Officer, other than our President and CEO, and provided a recommendation to the independent members of our Board on the EIP payout amount for our President and CEO for their consideration and approval.
The Compensation Committee set the 2021 EIP payout levels with a linear payout slope with 50% payout to occur at budget with 100% payout at an achievable stretch target.
The weighting and payout level percentages for each of these key corporate financial and operational objectives in 2021, to be paid linearly between payout levels, were as follows:
 
 
Payout Level
2021
Objective
Weighting
0%
50%
100%
150%
200%
2021
Actual
2021
Objective
Payout
Revenue Growth (dollar figures in millions) (1)
50%
<7.5%
$1,387 7.5%
$1,460 13.1%
$1,523 18.0%
$1,591 23.3%
$1,463
102.4%
Operating Margin (1)
30%
<18.0%
18.0%
18.7%
19.0%
19.5%
18.5%
93.3 (2)%
Software Revenue (in millions)
20%
<$320
$320
$337
$352
$368
$303
$0
(1)
Refer to Annex I for a reconciliation of non-GAAP financial measures.
(2)
Reflects payout as approved by the Compensation Committee after adjusting Operating Margin for actual annual cash incentive compensation expenses and associated payroll taxes versus related estimated expenses and taxes used when establishing the EIP payout slope.
The table above sets forth the 2021 actual results and the 2021 objective payout. For 2021, Company performance corresponded to a payout percentage of 102.4% for the Revenue Growth objective, 93.3% for the Operating Margin objective, and nil for the Software Revenue objective.
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The actual EIP bonus paid to each of our Named Executive Officers was calculated by multiplying the aggregate weighted 2021 EIP attainment percentage below by the 2021 EIP target amount (which is equal to the Named Executive Officer’s annual base salary multiplied by the EIP Target Percentage). Company performance for all key objectives resulted in 2021 weighted EIP attainment percentages of 79% for each of Mr. Starkloff, Ms. Rapp, Mr. Green, Mr. Rust, and Ms. Favre. For 2021, the EIP bonus paid to each of our Named Executive Officers is set forth in the table below.
Named Executive Officer
2021 EIP Target
Percentage
2021 EIP Target
Amount
2021 Weighted
Attainment
Percentage
2021
EIP Bonus Paid
Eric H. Starkloff
135%
$992,250
79%
$785,763
Karen M. Rapp
100%
480,000
79%
380,112
Jason E. Green
80%
460,000
79%
364,274
Scott A. Rust (1)
74%
307,344
79%
243,386
Ritu Favre
100%
425,000
79%
336,558
(1)
Mr. Rust’s 2021 EIP Target Percentage was based on a 65% target percentage and $412,500 base salary for the first three quarters of 2021 and, following his promotion to Executive Vice President, Platform & Product, effective October 1, 2021, a 100% target percentage and $425,000 base salary for the fourth quarter of 2021.
Business Unit (“BU”) Performance Bonus
In 2021, in consideration of Mr. Green’s new role as Executive Vice President, Portfolio BU, Mr. Green was eligible to receive a cash bonus based on pre-determined metrics related to the Portfolio BU. Mr. Green’s bonus was based on the following metrics:
 
0%
50%
100%
2021 Portfolio BU Revenue Growth YoY
<0%
0%
3%
Payout
$0
$100,000
$200,000
The 2021 metrics were intended to be achievable, yet still tied to performance, in particular in light of the Portfolio BU’s declining revenue during the prior year. In 2021, the Portfolio BU achieved 9.5% revenue growth year-over-year, as a result of which Mr. Green was awarded a $200,000 cash performance bonus.
Long-Term Incentive Compensation
We believe that long-term incentive compensation in the form of equity awards is a critical element of our executive compensation program. The equity awards provide strong alignment between the interests of our Named Executive Officers and our stockholders. The realized value of these equity awards bears a direct relationship to our stock price, and, therefore, these awards are an incentive for our Named Executive Officers to create value for our stockholders. Equity awards also help us retain qualified Named Executive Officers in a competitive market.
Long-term incentive compensation opportunities in the form of equity awards are granted pursuant to the applicable equity incentive plan by the Compensation Committee, typically at a meeting of the Compensation Committee held during the first quarter of the year. In 2021, awards were granted from the 2020 Equity Incentive Plan. The amount and forms of such equity awards are determined by the Compensation Committee after considering an analysis prepared by its independent compensation consultant, the factors described in “Compensation Discussion and Analysis — Compensation-Setting Process” above and the retention power on each Named Executive Officer as determined by his or her current unvested equity holdings. The amounts of the equity awards are intended to provide competitive value that results in target total direct compensation opportunities within a competitive range of the market data relative to our compensation peer group for similar roles and positions for each of our Executive Officers. The values are also determined by other considerations such as business results, experience, and individual performance.
Since 2019, in response to feedback received from our stockholders and our own due diligence through benchmarking activities, the Compensation Committee has granted PRSUs representing 50% of the equity award value under our long-term incentive program for our Named Executive Officers (other than our President and CEO), while the other 50% of the equity award value consisted of RSUs. For our President and CEO, PRSUs represent 60% of the equity award value in 2021, while 40% consisted of RSUs.
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The following table shows the target number of shares of our common stock pursuant to PRSU awards granted to each of our Named Executive Officers in 2021:
Named Executive Officer
Target PRSUs
Target Grant Date
Fair Value (1)
Eric H. Starkloff
67,461
$4,566,873
Karen M. Rapp
21,043
1,392,697
Jason E. Green
18,705
1,237,961
Scott A. Rust
8,768
580,296
Ritu Favre
14,029
928,487
(1)
The fair values of the PRSUs were estimated using a Monte Carlo simulation model. The determination of fair value of the PRSUs is affected by our stock price and a number of assumptions including the expected volatility, expected dividend yield and the risk-free interest rate. Our expected volatility at the date of grant was based on the historical volatilities of our common stock and the companies included in the Index over the performance period. Grant date fair value is based on the grant date of January 19, 2021 (for grants made to Ms. Rapp, Mr. Green, Mr. Rust and Ms. Favre) and February 17, 2021 (for the grant made to Mr. Starkloff).
The 2021 PRSUs were granted on February 17, 2021, for Mr. Starkloff, and on January 19, 2021, for our other Named Executive Officers. At the end of the performance period, the 2021 PRSUs may be earned and eligible for vesting based on our TSR compared to the TSR of the Index over a three-year performance period that commenced on January 1, 2021 and will end on December 31, 2023 (using the average daily closing price of our common stock over a 30-day lookback period in each case). A linear calculation is performed between the stated percentiles to determine actual vesting of PRSUs at the end of the performance period.
The Compensation Committee set the target at the 55th percentile of the Index to incentivize above-median performance. The number of shares of our common stock subject to the awards will be earned from 0% to 200% of the target number of shares based on our TSR compared to the Index as follows:
Payout Level
TSR Percentile Rank Against
the Russell 2000 Index
Payout Percentage of Target
Number of Shares
Maximum
≥80th Percentile
200%
Stretch
65th Percentile
150%
Target
55th Percentile
100%
Threshold
25th Percentile
50%
None
<25th Percentile
0%
The following table shows the number of shares of our common stock pursuant to RSU awards granted to each of our Named Executive Officers in 2021:
Named Executive Officer
RSUs
(Number of Shares)
Grant
Date Fair Value (1)
Eric H. Starkloff
44,974
$2,092,640
Karen M. Rapp (2)
48,743
2,188,234
Jason E. Green
18,705
850,890
Scott A. Rust
8,768
398,856
Ritu Favre
14,029
638,179
(1)
The fair values of RSUs are estimated using the closing price of our common stock for the day immediately prior to the date of grant.
(2)
Ms. Rapp’s RSU awards include a one-time retention award granted on April 20, 2021, with a grant date fair value of $1,230,988 (the “Rapp April 2021 Award”).
The 2021 RSUs (other than the Rapp April 2021 Award) vest in equal annual installments over a three-year period, with the first installment vesting on May 1, 2022, contingent upon the Named Executive Officer remaining continuously employed by us through each applicable vesting date.
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The Rapp April 2021 Award vests in equal annual installments over a two- year period, with the first installment vesting on February 28, 2022, contingent upon Ms. Rapp remaining continuously employed by us through each applicable vesting date. Pursuant to our 2020 Equity Incentive Plan, the Compensation Committee awarded to Ms. Rapp the Rapp April 2021 Award to further business continuity and success, as well as to provide Ms. Rapp with continued motivation and financial reward.
The overall long-term incentive equity award value for our President and CEO and our other Named Executive Officers was determined after consideration of multiple factors as described in the “Compensation Discussion and Analysis — Compensation–Setting Process” section above. Such factors include a competitive market analysis prepared by the Compensation Committee’s independent compensation consultant as well as the current retention incentive for each Named Executive Officer as determined by his or her current unvested equity holdings.
The equity awards granted to our Named Executive Officers in 2021 are set forth in the 2021 “Summary Compensation Table” and the 2021 “Grants of Plan-Based Awards” table below.
The PRSU awards previously granted in 2019 and 2020 to our Named Executive Officers are also measured against the Index. The performance period for the PRSU awards granted in 2019 began on January 1, 2019 and ended on December 31, 2021 (the “2019 Performance Period”), and the performance period for the PRSU awards granted in 2020 began on January 1, 2020 and ends on December 31, 2022. For the 2019 Performance Period, the Company’s TSR ranked in the 32.33 percentile as compared to the Index, such that 62% of PRSUs granted in 2019 vested as of December 31, 2021. The following table shows the total number PRSUs granted to our Named Executive Officers in January 2019, the vesting percentage and the number of vested PRSUs as of December 31, 2021.
Named Executive Officer (1)
PRSUs Granted in
2019
Vesting
Percentage
Number of Vested
Performance-Based
Restricted Stock
Units
Eric H. Starkloff
16,625
62%
10,307
Karen M. Rapp
13,006
62%
8,063
Scott A. Rust
8,482
62%
5,258
(1)
Ms. Favre and Mr. Green were not eligible for PRSU grants in January 2019.
Health and Other Benefits
Our Named Executive Officers are eligible to receive an annual physical as well as the same employee benefits that are generally available to all our full-time employees, subject to the satisfaction of certain eligibility requirements. These benefits include flexible spending accounts, medical, dental and vision benefits, business travel insurance, employee assistance program, basic life insurance benefits, accidental death and dismemberment insurance policies, short-term and long-term disability insurance, and commuter benefits. In structuring these programs, we seek to provide an aggregate level of benefits that are comparable to those provided by similar companies, compliant with applicable laws and affordable to employees.
We maintain a tax-qualified Section 401(k) retirement savings plan (the “Section 401(k) Plan”) that provides eligible employees, including our Named Executive Officers, with an opportunity to save for retirement on a tax-advantaged basis. In 2021, we made matching contributions under the Section 401(k) Plan in an amount equal to 50% of the amount of the participant’s contribution up to 8% of the participant’s eligible compensation, after the employee's first year of service. All participants’ interests in the matching contributions vest immediately from the time of contribution. Pre-tax contributions are allocated to each participant’s individual account and are then invested in selected investment alternatives according to the participants’ directions. The Section 401(k) Plan is intended to qualify under Sections 401(a) and 501(a) of the Internal Revenue Code of 1986, as amended (the “Code”). As a tax-qualified retirement plan, contributions to the Section 401(k) Plan and earnings on those contributions are not taxable to the employees until distributed from the Section 401(k) Plan, and all contributions are deductible by us when made. The Section 401(k) Plan does not provide for purchases of NI common stock.
We also maintain the 1994 Employee Stock Purchase Plan (the “ESPP”). The ESPP is generally intended to qualify as a tax-favored employee stock purchase plan under Section 423 of the Code. The ESPP permits eligible employees to purchase shares of our common stock at a 15% discount to the market price. Under this plan, a participant can invest a maximum amount equal to 15% of eligible compensation, provided that such amount cannot exceed $25,000 in any year.
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In structuring these benefit programs, we seek to provide an aggregate level of benefits that are comparable to those provided by similar companies.
Perquisites and Other Personal Benefits
We do not view perquisites or other personal benefits as a significant component of our executive compensation program. Accordingly, we do not provide significant perquisites or other personal benefits to our Named Executive Officers. During 2021, none of our Named Executive Officers received perquisites or other personal benefits that were, in the aggregate, valued at $10,000 or more for each individual.
In the future, we may provide perquisites or other personal benefits in limited circumstances. All future practices with respect to perquisites or other personal benefits will be approved and subject to periodic review by the Compensation Committee.
Employment Arrangements and Post-Employment Compensation
We have written employment agreements with each of our Named Executive Officers. In 2021, we entered into executive employment agreements with each of Ms. Rapp, Mr. Green, Ms. Favre, and Mr. Rust. In filling each of our executive positions, we recognized the need to develop competitive compensation packages to attract qualified candidates in a dynamic labor market. At the same time, in formulating these compensation packages, we were sensitive to the need to integrate new Executive Officers into the executive compensation structure that we were seeking to develop, balancing both competitive and internal equity considerations. These arrangements provide for “at will” employment.
On October 28, 2019, in connection with Mr. Starkloff’s appointment as CEO, we entered into the Starkloff Executive Employment Agreement, which provided that Mr. Starkloff’s duties and compensation were to be effective February 1, 2020. On February 3, 2020, the Starkloff Executive Employment Agreement was amended to reflect the implementation of the Company’s EIP. The terms and conditions of employment of Mr. Starkloff as set forth in the Starkloff Executive Employment Agreement contain post-employment compensation arrangements that provide Mr. Starkloff with certain protection in the event of his termination of employment in specified circumstances such as involuntarily termination without Cause or for resignation for Good Reason, including following a Change in Control (each as defined in the Starkloff Executive Employment Agreement). The Starkloff Executive Employment Agreement provides that in the event of a Change in Control, and if Mr. Starkloff’s employment is terminated other than for Cause or he resigns for Good Reason within 18 months after the Change in Control, Mr. Starkloff would be entitled to certain severance payments and benefits. Mr. Starkloff’s Executive Employment Agreement provides for “double-trigger” payments and benefits which means that payments and benefits will not become payable unless both events occur. See “Potential Payments Upon Termination or Change of Control” below for a further description.
On February 22, 2021, we entered into a written executive employment agreement with each of Ms. Rapp, Mr. Green, and Ms. Favre and on September 28, 2021 we entered into a written executive employment agreement, effective as of October 1, 2021, with Scott Rust (the “2021 Executive Employment Agreements”). The terms and conditions of employment of Ms. Rapp, Mr. Green Ms. Favre, and Mr. Rust, as set forth in the 2021 Executive Employment Agreements, contain post-employment compensation arrangements that provide these Named Executive Officers with certain protection in the event of their termination of employment in specified circumstances such as involuntarily termination without Cause or for resignation for Good Reason, including following a Change in Control (each as defined in the 2021 Executive Employment Agreements). Each of these Named Executive Officer’s 2021 Executive Employment Agreements provide that in the event of a Change in Control, and if the Named Executive Officers’ employment is terminated other than for Cause or if the Named Executive Officer resigns for Good Reason within 12 months after the Change in Control, each of these Named Executive Officers would be entitled to certain severance payments and benefits. The 2021 Executive Employment Agreements provide for “double-trigger” payments and benefits which means that payments and benefits will not become payable unless both events occur. See “Potential Payments Upon Termination or Change of Control” below for a further description.
For detailed descriptions of the employment arrangements we maintained with our Named Executive Officers for 2021 and an estimate of the potential payments and benefits payable under these arrangements, see “Potential Payments Upon Termination or Change of Control” below.
We believe that these protections incentivized these individuals to accept and retain their positions. We also believe that these arrangements help maintain their continued focus and dedication to their assigned duties to
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maximize stockholder value. Our Compensation Committee (and with respect to Mr. Starkloff, our Board considered the recommendation of the Compensation Committee and) reviewed the proposed terms of these arrangements and deemed it to be in the best interests of NI and its stockholders to approve the terms of such arrangements.
We do not use excise tax payments (or “gross-ups”) relating to a change in control of NI and have no such obligations in place with respect to any of our Named Executive Officers.
In addition, our equity compensation plans provide for the acceleration of vesting of outstanding and unvested equity awards in certain circumstances. Specifically, the 2005 Incentive Plan and the 2010 Incentive Plan provide that in the event of a change of control of NI, all outstanding and unvested restricted stock unit awards held by our employees, including our Named Executive Officers, will immediately vest in full. Further, under the 2015 Incentive Plan and the 2020 Incentive Plan, in the event of a change in control of NI, all outstanding and unvested equity awards will be treated as determined by the plan administrator, including that each award be assumed or substituted by the successor corporation; provided, however, that, in the event the successor corporation does not assume or substitute for the awards, the restriction period of any award of restricted stock or restricted stock unit award will immediately be accelerated and the restrictions will expire, and, with respect to awards with performance-based vesting, all performance goals or other vesting criteria will be deemed achieved at 100% of target levels and all other terms and conditions met. The number of PRSUs so determined will be scheduled to vest in equal monthly installments following the change of control over the remainder of the original performance period.
Following any assumption or substitution of such awards, if the employment of an employee is terminated without Cause (as defined in the 2015 Incentive Plan or 2020 Incentive Plan) within 24 months following the change in control of NI, then the vesting of such employee’s award will immediately accelerate and the restricted stock, RSU and PRSU awards will immediately become fully vested.
There are no significant modifications to the change of control provisions in the proposed 2022 Incentive Plan as compared to the 2020 Incentive Plan.
Other Compensation Policies
Equity Award Grant Policy
We do not have any program, plan or practice to time the grant of equity awards in coordination with the release of material non-public information. In addition, we do not time, nor do we plan to time, the release of material non-public information for the purposes of affecting the value of our executive compensation.
Stock Ownership Policy
We encourage our Named Executive Officers and members of our Board to hold a significant equity interest in NI. To that end, our Board initially adopted a Stock Ownership Policy, effective December 31, 2017 (the “2017 Policy”) to further align the interests of our Named Executive Officers and the non-employee members of our Board with the interests of our stockholders and to promote our commitment to good corporate governance. On October 23, 2019, our Board determined to increase the stock ownership thresholds of our CEO and non-employee members of our Board and adopted a new Stock Ownership Policy, effective December 31, 2019 (the “2019 Policy”). The guidelines established under our stock ownership policies are intended to take into account an individual’s needs for portfolio diversification, while maintaining an ownership interest at levels sufficient to assure our stockholders of leadership’s commitment to long-term value creation.
Our 2017 Policy requires that:
our CEO hold shares of NI common stock having a value equal to at least three times his annual base salary;
our other Named Executive Officers hold shares of NI common stock having a value equal to at least two times his or her annual base salary; and
the non-employee members of our Board hold shares of NI common stock having a value equal to at least three times the amount of the annual retainer paid to such director for his or her service on our Board.
Our 2019 Policy requires that:
our CEO hold shares of NI common stock having a value equal to at least six times his annual base salary;
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our other Named Executive Officers hold shares of NI common stock having a value equal to at least two times his or her annual base salary; and
the non-employee members of our Board hold shares of NI common stock having a value equal to at least six times the amount of the annual retainer paid to such director for his or her service on our Board.
Under both policies, eligible stock ownership includes only: (i) shares owned directly by the Named Executive Officer or non-employee member of our Board or his or her immediate family members residing in the same household, and (ii) shares held in trust for the benefit of the Named Executive Officer or non-employee member of our Board or his or her family. The value of each share is measured on the last day of the fiscal year as the greater of (a) the closing price on the date of calculation and (b) the purchase price actually paid by the person for such share.
Each policy requires that our President and CEO, our other Named Executive Officers, and the non-employee members of our Board achieve the applicable levels of ownership within five years after the later of (i) the effective date of the applicable policy, or (ii) the date of his or her appointment. The 2017 Policy continues to apply to those Named Executive Officers and non-employee members of our Board who were subject to the 2017 Policy as of December 31, 2019. Such Named Executive Officers and non-employee members of our Board are required to achieve the applicable level of ownership set forth in the 2017 Policy in addition to the 2019 Policy; however, stock ownership counted for purposes of the 2017 Policy will also qualify in determining stock ownership for the 2019 Policy and vice versa.
Compensation Clawback Policy
In September 2021, we implemented a Clawback Policy applicable to any current and former Executive Officers. Pursuant to the Clawback Policy, if an Executive Officer engages in fraud, intentional misconduct or gross negligence that causes or partially causes the restatement of NI’s financial statements due to material noncompliance with financial reporting requirements, the Compensation Committee may require such Executive Officer to reimburse or forfeit all or a portion of any excess incentive compensation (cash or equity-based compensation) that is paid to, awarded to, or received by such Executive Officer based on the achievement of financial or stock performance metrics, and which was awarded on or after January 1, 2022 and paid in the preceding three-year period from the time the Company determines that it must restate its financial statements.
Derivative Trading, Short Sales, Margin Accounts and Hedging
Our Insider Trading Policy applies to all members of our Board of Directors, officers, employees, consultants, contractors, agents or other service providers of NI. Pursuant to our Insider Trading Policy, we do not permit short sales of our securities, or trading in publicly-traded options, such as puts and calls, and other derivative securities with respect to our securities (other than stock options, restricted stock units and other compensatory awards issued by us) or purchasing financial instruments, or otherwise engaging in transactions, that hedge or offset, or are designed to hedge or offset, any decrease in the market value of equity securities either granted by NI as part of compensation, or held, directly or indirectly by an individual.
In addition, we prohibit those persons subject to our quarterly blackout periods from holding our securities in a margin account or pledging our securities as collateral for any loan or as part of any other pledging transaction. Persons subject to our quarterly blackout periods include our executive leadership team and their direct reports, certain members of the accounting and finance departments identified by their respective executive leadership team member as having specialized knowledge, certain members of the sales department identified by their respective executive leadership team member as having specialized knowledge, all members of the legal department, persons who receive or have access to certain reports or systems, or otherwise have access to companywide monthly, quarterly, or annual financial results, and any additional employee otherwise notified in writing by the legal department.
Tax and Accounting Considerations
In designing our executive compensation program, the Compensation Committee considers the anticipated tax and accounting implications to NI and our Executive Officers. While the Compensation Committee considers the applicable tax and accounting treatment of the elements of our executive compensation program, these factors are not dispositive in its decision making.
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Deductibility of Executive Compensation
Section 162(m) of the Code imposes a limit on the deductibility for federal income tax purposes of any remuneration in excess of $1 million paid to our CEO, Chief Financial Officer, and each of the next three most highly compensated executive officers of the company. The Tax Cuts and Jobs Act eliminated the exemption for the chief financial officer and for “performance-based compensation” beginning January 1, 2018. As a result, subject to certain limited exceptions arrangements that qualify as written binding contracts that were in effect on November 2, 2017 and which have not been subsequently materially modified, we expect that compensation paid to our Named Executive Officers in excess of $1 million generally will not be deductible. While the Compensation Committee has taken steps in the past to preserve tax deductibility under Section 162(m), it has retained and will continue to retain authority to approve compensation arrangements that may not be fully tax deductible by reason of Section 162(m).
Accounting for Stock-Based Compensation
The Compensation Committee takes accounting considerations into account in designing compensation plans and arrangements for our Executive Officers and other employees including FASB ASC Topic 718, the standard which governs the accounting treatment of certain stock-based compensation. Among other things, FASB ASC Topic 718 requires us to record a compensation expense in our income statement for all equity awards granted to our Executive Officers and other employees. This compensation expense is based on the grant date “fair value” of the equity award and, in most cases, will be recognized ratably over the award’s requisite service period (which, generally, will correspond to the award’s vesting schedule). This compensation expense is also reported in the Summary Compensation Table, even though recipients may never realize any value from their equity awards.
The fair values of PRSUs are estimated using a Monte Carlo simulation model. The determination of fair value of the PRSU is affected by our stock price and a number of assumptions including the expected volatility, expected dividend yield and the risk-free interest rate. Our expected volatility at the date of grant was based on the historical volatilities of our common stock and the companies included in the Index over the performance period.
Compensation Committee Report*
The Compensation Committee of NI has reviewed and discussed the Compensation Discussion and Analysis required by Regulation S-K Item 402(b) with management and based upon such review and discussion, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement.
Respectfully Submitted,
Duy-Loan T. Le, Chair
Gayla J. Delly
Dr. Gerhard P. Fettweis
Liam K. Griffin
*
The foregoing Report of the Compensation Committee is not to be deemed to be “soliciting material” or to be “filed” with the Securities Exchange Commission or subject to Regulation 14A or 14C or to the liabilities of Section 18 of the Securities Exchange Act of 1934, except to the extent we specifically request that such information be treated as soliciting material or we specifically incorporate it by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934.
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Executive Compensation Tables
SUMMARY COMPENSATION TABLE
The following table shows the total compensation earned by our Named Executive Officers during the years ended December 31, 2021, December 31, 2020, and December 31, 2019:
Name and
Principal Position
Year
Salary
Bonus
(1)
Stock
Awards
(2)
Non-Equity
Incentive Plan
Compensation
(3)
All Other
Compensation
(4)
Total
Eric H. Starkloff (5)(6)
President and CEO
2021
$735,000
$
$6,659,514
$785,763
$10,108
$8,190,385
2020
629,271
10,414,680
411,075
10,608
11,465,634
2019
551,250
1,737,863
106,116
50,645
2,445,874
Karen M. Rapp (7)
Executive Vice President
and Chief Financial Officer
2021
480,000
3,580,931
380,112
8,260
4,449,303
2020
439,795
1,677,021
159,703
8,093
2,284,612
2019
413,438
1,359,557
77,520
10,448
1,860,964
Jason E. Green*
Executive Vice President & GM,
Portfolio BU and Chief Revenue
Officer
2021
575,000
200,000
2,088,851
364,274
10,110
3,238,235
2020
551,042
100,284
1,197,918
193,200
10,110
2,052,554
Scott A. Rust
Executive Vice President,
Platform & Technology
2021
415,625
979,152
243,386
13,485
1,651,648
2020
383,717
1,000
958,313
113,213
11,760
1,468,003
2019
385,000
886,650
42,350
11,160
1,325,160
Ritu Favre*
Executive Vice President & GM,
Business Units
2021
425,000
1,566,666
336,558
11,760
2,339,984
*
Mr. Green became a Named Executive Officer in January 2020, and Ms. Favre became a Named Executive Officer in January 2021.
(1)
In 2021, Mr. Green received a $200,000 performance bonus based on the Portfolio BU’s performance during that year based. In 2020, Mr. Green received a service award of $284 and a $100,000 transition payment as the Compensation Committee approved transferring Mr. Green from a sales-based incentive compensation plan to the EIP. This payment was intended to compensate Mr. Green for the short-term negative impact on his compensation caused by his being transferred to the EIP. In 2020, Mr. Rust received a service award of $1,000. All employees, including executives, are eligible under NI’s service award program pursuant to which employees may receive awards based on the number of years of continued employment with NI. Awards under the service award program have historically been in the range of $100 to $1,000 per award, with employees receiving $100 in cash at their 5th anniversary of service with NI and $1,000 in cash at their 10th, 15th, 20th and 25th anniversaries of service with NI.
(2)
The amounts included in the table for stock awards represent the aggregate grant date fair value of awards made each fiscal year, as computed in accordance with FASB ASC 718. The grant date fair value for time-based RSUs is measured in accordance with FASB ASC 718 and based on the closing price of NI’s common stock preceding the date of grant. The grant date fair value for PRSUs is calculated using a Monte-Carlo model for each award on the date of grant, as determined under FASB ASC 718, based on the probable outcome of the performance condition as of the grant date. The fair value for each award may differ based on the applicable data, assumptions, and estimates used in the model. Our expected volatility at the date of grant was based on the historical volatilities of our common stock and the companies included in the Index over the performance period. Although the assumed probable outcome as of the grant date was achievement at the target level, the terms of the awards for PRSUs also provide for achievement of up to 200% of the target amount (the “maximum”).
(3)
Amounts reflect the sum of the amounts earned by Named Executive Officers pursuant to the EIP for 2021 and 2020, and for 2019, these amounts reflect the sum of the amounts earned by Named Executive Officers pursuant to our previous cash bonus programs, the Annual Company Performance Bonus Program and the Annual Incentive Program.
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(4)
These amounts represent NI contributions to the Section 401(k) Plan on behalf of the Named Executive Officers, the full dollar value of premiums paid by NI for term life insurance on behalf of the Named Executive Officers for 2021, 2020, and 2019, and certain other payments in the amounts shown below:
Named Executive Officer
Year
NI
Contributions
to 401(k)
Plan
Term Life
Insurance
Premium Paid
by NI for
Benefit of the
Insured
Other *
Total
Eric H. Starkloff
2021
$8,748
$360
$1,000
$10,108
2020
8,748
360
1,500
10,608
2019
8,748
360
41,537
50,645
Karen M. Rapp
2021
7,900
360
8,260
2020
7,733
360
8,093
2019
10,088
360
10,448
Jason E. Green
2021
9,750
360
10,110
2020
9,750
360
10,110
Scott A. Rust
2021
11,625
360
1,500
13,485
2020
11,400
360
11,760
2019
10,800
360
11,160
Ritu Favre
2021
11,400
360
11,760
*
The dollar amounts listed in “Other” reflect fees and expenses paid related to contributions by NI to Mr. Starkloff’s health spending account paid in 2021 and 2020, and to Mr. Rust’s health spending account for 2021. For 2019, the dollar amounts listed in “Other” reflect fees and expenses paid related to the negotiation of Mr. Starkloff's Executive Employment Agreement and amounts paid in connection with Mr. Starkloff’s participation in an incentive award trip. Other than the foregoing, for 2021, 2020, and 2019, NI did not provide its Named Executive Officers with any form of compensation that would be reportable under Item 402(c)(2)(ix) of Regulation S-K. NI does not pay or accrue cash dividends on unvested RSUs.
(5)
Pursuant to the Starkloff Executive Employment Agreement, Mr. Starkloff was appointed as our CEO, effective February 1, 2020, and continues to serve as our President. Mr. Starkloff's base salary increased to $700,000 at that time. Mr. Starkloff’s base salary shown for 2020 above is pro-rated based upon the number of days during the year the respective base salary increase was in effect.
(6)
The amount reflected in the “Stock Awards” column above for 2020 includes a one-time promotional grant of 75,000 PRSUs and 75,000 RSUs, granted pursuant to the Starkloff Executive Employment Agreement, upon Mr. Starkloff becoming our CEO.
(7)
The amount reflected in the “Stock Awards” column above for 2021 includes the Rapp April 2021 Award, a one-time retention award of 27,700 RSUs granted on April 20, 2021, with a grant date fair market value of $1,230,988.
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GRANTS OF PLAN-BASED AWARDS TABLE
FOR FISCAL YEAR ENDED DECEMBER 31, 2021
Named Executive Officer
Grant
Date (1)
Estimated Future Payouts Under
Non-Equity Incentive Plan Awards
Estimated Future Payouts Under
Equity Incentive Plan Awards: Number
of Shares of Stock or Stock Units
All Other
Stock
Awards:
Number of
Shares of
Stock or
Units (3)
Aggregate
Grant Date
Fair Value
of Stock
Awards
Threshold (2)
Target
Maximum
Threshold
Target
Maximum
Eric H. Starkloff
Executive Incentive Program (EIP)
$496,125
$992,250
$1,984,500
2020 Incentive Plan - RSUs
2/17/2021
44,974
$2,092,640
2020 Incentive Plan - PRSUs
2/17/2021
33,730
67,461
134,922
4,566,873
Karen M. Rapp
Executive Incentive Program (EIP)
$240,000
$480,000
$960,000
2020 Incentive Plan - RSUs
1/19/2021
21,043
957,246
2020 Incentive Plan – RSUs (Retention)
4/20/2021
27,700
1,230,988
2020 Incentive Plan - PRSUs
1/19/2021
10,521
21,043
42,086
1,392,697
Jason E. Green
Executive Incentive Program (EIP)
$230,000
$460,000
$920,000
2020 Incentive Plan - RSUs
1/19/2021
18,705
850,890
2020 Incentive Plan - PRSUs
1/19/2021
9,352
18,705
37,410
1,237,961
Scott A. Rust
Executive Incentive Program (EIP)
$153,672
$307,344
$614,688
2020 Incentive Plan - RSUs
1/19/2021
8,768
398,856
2020 Incentive Plan - PRSUs
1/19/2021
4,384
8,768
17,536
580,296
Ritu Favre
Executive Incentive Program (EIP)
$212,500
$425,000
$850,000
2020 Incentive Plan - RSUs
1/19/2021
14,029
638,179
2020 Incentive Plan - PRSUs
1/19/2021
7,014
14,029
28,058
928,487
(1)
In accordance with Item 402(d)(2)(ii) of Regulation S-K, only grant dates for equity-based awards are reported in this table.
(2)
Threshold amounts for each of the three metrics unde