Shift4 Payments, Inc.
For the period ended Jun 7, 2024. Filed Apr 26, 2024.
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Jun 7, 2024 · Filed Apr 26, 2024
Contents
APPENDIX A
Adjusted EBITDA is the primary financial performance measure used by management to evaluate its business and monitor results of operations. Adjusted EBITDA represents EBITDA further adjusted for certainnon-cash and other nonrecurring items that management believes are not indicative of ongoing operations. These adjustments include acquisition, restructuring and integration costs, revaluation of contingent liabilities, unrealized gains or losses on investments in securities, changes in TRA liability, equity-based compensation expense, and other nonrecurring items. The financial impact of certain elements of these activities is often significant to our overall financial performance and can adversely affect the comparability of our operating results and investors’ ability to analyze the business from period to period.
We usenon-GAAP financial measures to supplement financial information presented on a GAAP basis. We believe that excluding certain items from our GAAP results allows management to better understand our consolidated financial performance from period to period and better project our future consolidated financial performance as forecasts are developed at a level of detail different from that used to prepare GAAP-based financial measures. Moreover, we believe thesenon-GAAP financial measures provide our stakeholders with useful information to help them evaluate our operating results by facilitating an enhanced understanding of our operating performance and enabling them to make more meaningful period to period comparisons. There are limitations to the use of thenon-GAAP financial measures presented in this Annual Report. Ournon-GAAP financial measures may not be comparable to similarly titled measures of other companies. Other companies, including companies in our industry, may calculatenon-GAAP financial measures differently than we do, limiting the usefulness of those measures for comparative purposes.
Thenon-GAAP financial measures are not meant to be considered as indicators of performance in isolation from, or as a substitute for, financial information prepared in accordance with GAAP, and should be read only in conjunction with financial information presented on a GAAP basis. Reconciliations of gross revenue less network fees, EBITDA and Adjusted EBITDA to its most directly comparable GAAP financial measure are presented below. We encourage you to review the reconciliations in conjunction with the presentation of thenon-GAAP financial measures for each of the periods presented. In future periods, we may exclude such items and may incur income and expenses similar to these excluded items.
EBITDA and Adjusted EBITDA:
| Year Ended December 31, | ||
|---|---|---|
| (in millions) | 2023 | 2022 |
| Net income | $122.9 | $86.7 |
| Interest expense | 32.1 | 32.5 |
| Interest income | (31.9) | (10.8) |
| Income tax expense (benefit) | (3.4) | 0.2 |
| Depreciation and amortization | 214.6 | 149.1 |
| EBITDA | 334.3 | 257.7 |
| Acquisition, restructuring and integration costs (a) | 28.3 | 28.2 |
| Revaluation of contingent liabilities (b) | 23.1 | (36.6) |
| Impairment of intangible assets (c) | 18.6 | — |
| Unrealized gain on investments in securities (d) | (12.2) | (15.1) |
| Change in TRA liability (e) | 3.4 | 1.7 |
| Equity-based compensation (f) | 59.1 | 50.4 |
| Foreign exchange and other nonrecurring items (g) | 5.3 | 3.4 |
| Adjusted EBITDA | $459.9 | $289.7 |
| (a) | For the year ended December 31, 2023, primarily consisted of $23.2 million of acquisition-related costs and $4.6 million of restructuring costs. For the year ended December 31, 2022, primarily consisted of $23.7 million of acquisition-related costs. |
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| (b) | Consisted of fair value adjustments to contingent liabilities arising from acquisitions. |
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| (c) | For the year ended December 31, 2023, consisted of $18.6 million in non-cash impairment of intangible assets. During the fourth quarter of 2023, in conjunction with the acquisition of Finaro, Shift4 ceased development on several in-process software development projects. It was determined that the intellectual property obtained in the Finaro transaction was better suited for the objectives of these projects. The total impairment charge associated with these projects was $18.6 million. |
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| (d) | Represents adjustments to the fair value of investments in non-marketable securities. See Note 12 to our audited consolidated financial statements included in the 2023 Form 10-K for more information on the investments in non-marketable securities. |
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| (e) | Represents adjustments to the TRA liability. See Note 13 to our audited consolidated financial statements included in the 2023 Form 10-K for more information on the TRA. |
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| (f) | Consisted of equity-based compensation expense for RSUs, including employer taxes for vested RSUs. See Note 19 to our audited consolidated financial statements included in the 2023 Form 10-K for more information on equity-based compensation. |
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| (g) | For the year ended December 31, 2023, primarily consisted of $4.0 million of unrealized foreign exchange losses and $1.9 million of legal and professional expenses for non-routine matters. For the year ended December 31, 2022, primarily consisted of $1.1 million of costs associated with an internal processing system disruption that required technical remediation, in addition to numerous other items. |
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3501 CORPORATE PARKWAY
CENTER VALLEY, PENNSYLVANIA 18034
VOTE BY INTERNET
Before the Meeting- Go towww.proxyvote.com or scan the QR Barcode above
Use the Internet to transmit your voting instructions and for electronic delivery of information. Vote by 11:59 p.m. Eastern Time on June 6, 2024. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form.
During the Meeting- Go towww.virtualshareholdermeeting.com/FOUR2024
You may attend the meeting via the Internet and vote during the meeting. We recommend, however, that you vote before the meeting even if you plan to participate in the meeting, since you can change your vote during the meeting by voting when the polls are open. Have the information that is printed in the box marked by the arrow available and follow the instructions.
VOTE BY PHONE - 1-800-690-6903
Before the Meeting- Use any touch-tone telephone to transmit your voting instructions. Vote by 11:59 p.m. Eastern Time on June 6, 2024. Have your proxy card in hand when you call and then follow the instructions.
VOTE BY MAIL
Before the Meeting- Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
V47535-P12354 KEEP THIS PORTION FOR YOUR RECORDS
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DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
| SHIFT4 PAYMENTS, INC. | For | Withhold | For All | To withhold authority to vote for any individual |
|---|---|---|---|---|
| The Board of Directors recommends you vote FOR the election of all of the Class I director nominees listed in the following proposal: | All | All | Except | nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below. |
| 1. | Election of Class I Directors | ☐ | ☐ | ☐ |
| Nominees: | ||||
| 01) | Karen Roter Davis | |||
| 02) | Jared Isaacman | |||
| The Board of Directors recommends you vote FOR the following proposal: · For · Against · Abstain | ||||
| 2. | Ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2024. | ☐ | ☐ | ☐ |
| The Board of Directors recommends you vote FOR the following proposal: · For · Against · Abstain | ||||
| 3. | Approval, on an advisory (non-binding) basis, of the compensation of the Company’s named executive officers. | ☐ | ☐ | ☐ |
| NOTE: Such other business as may properly come before the Annual Meeting or any continuation, adjournment or postponement thereof. | ||||
| Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer. | ||||
| Signature [PLEASE SIGN WITHIN BOX] | Date | Signature (Joint Owners) | Date |
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The Notice and Proxy Statement and Form 10-K are available at www.proxyvote.com.
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V47536-P12354
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 7, 2024
The undersigned stockholder(s) of Shift4 Payments, Inc. hereby appoint(s) Nancy Disman and Jordan Frankel, or either of them, as proxies, each with the power to appoint his substitute, and hereby authorize(s) them to represent and to vote, as designated on the reverse of this proxy card, all of the shares of Class A common stock, Class B common stock, and/or Class C common stock of Shift4 Payments, Inc. that the stockholder(s) is/are entitled to vote at the Annual Meeting of Stockholders to be held at 12:00 p.m. Eastern Time on June 7, 2024, via a live webcast atwww.virtualshareholdermeeting.com/FOUR2024, and any adjournment, continuation or postponement thereof. Such proxies are authorized to vote in their discretion (x) for the election of any person to the Board of Directors if any nominee named herein becomes unable to serve or for good cause will not serve, (y) on any matter that the Board of Directors did not know would be presented at the Annual Meeting of Stockholders by a reasonable time before the proxy solicitation was made, and (z) on such other business as may properly be brought before the meeting or any adjournment, continuation or postponement thereof.
This proxy, when properly executed, will be voted in the manner directed herein by the undersigned stockholder(s). If no such direction is made, this proxy will be voted in accordance with the Board of Directors’ recommendations.
Continued and to be signed on reverse side
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