Point-of-sale and e-commerce payment software provider Lightspeed has been generous with its top executives.
Posted at 6:00 a.m.
The six most senior executives received a total compensation of 70 million US dollars for the financial year ending March 31, 2022. This is not unlike the case of the CEO of the Quebec company Nuvei, Philip Fayer, whose remuneration amounted last year to 112 million US.
The Caisse de depot et placement du Quebec is Lightspeed’s largest shareholder, holding 16% of the outstanding shares. The institution reserves its comments until the time of the shareholder vote scheduled for August 4.
“These high compensation levels show the importance of having a very solid compensation policy. It is important that the compensation scenarios consider all eventualities in order to put in place the necessary mechanisms to avoid excessive differences,” says Professor Yan Cimon, of Laval University, to whom The Press asked for comment on the Lightspeed and Nuvei cases.
The information is taken from the report on executive compensation reproduced in the management circular that the two companies filed with the stock market authorities recently.
At Lightspeed, the bulk of the money comes from options that were granted during the fiscal year to senior executives. The past year has been marked by a game of musical chairs at the top of the company, which has resulted in a renegotiation of compensation for promoted executives.
The objective of these generous option grants is “to motivate and retain” the key executives concerned, the company explains in the circular.
The options granted cannot be exercised immediately.
An option is a right to acquire a share at a predetermined price. Most options granted in the last fiscal year have a strike price above Lightspeed’s current stock price, which has lost nearly 44% of its value since the start of 2022 and melted 83% since its 52-week high at $165.87. The stock was selling for $28.84 in Toronto and US$22.29 in New York on Thursday.
An option with a distant expiration date retains value even if the strike price is higher than the current price, because its holder remains hopeful that the stock price will exceed the strike price before the date. due date.
Up to 1.5 million shares
In February 2022, the new CEO, Jean Paul Chauvet, was awarded total compensation of US$22 million in the last financial year, of which US20 million was in the form of options. He received options giving him the right to buy up to 1.5 million shares of Lightspeed at an exercise price of US$31.47. These options will vest gradually over a period of five years depending on the performance of the share and the achievement of growth objectives. This performance option package will be the only one granted to him by 2025.
As for the other executives, Dax Dasilva, chairman and director of the board, is entitled to a total compensation of 8.7 million US, including 7.6 million US in options. Brandon Nussey, chief financial and operating officer, sees his remuneration reach 12 million US, including 11.3 million US in the form of options.
“The amounts stated in the executive circular here represent the accounting valuation of these bonuses, not the actual value that has been or could be earned by these executives,” said Amber van Moessner, chief communications officer at Lightspeed, in an email. The actual value will depend on the performance of the company’s share price over the next five years. »
“The details of these compensations have been discussed in detail with Lightspeed’s major shareholders, who have generally supported and appreciated that the interests of executives are aligned with those of shareholders,” she adds.
Jean-David Saint-Martin, Asha Bakshani and Michael DeSimone have compensation of 6.1 million US, 8.3 million US and 12.3 million US respectively. The vast majority of the amounts take the form of option- or share-based awards.