What changed in this filing

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Item 9A. Controls and Procedures

2021-02-05 compared with 2020-02-05 · 276 added, 291 removed, 1055 unchanged (35% of the section changed)

14 unchanged sentences

Other Information.

Amended and Restated Bylaws

On February 2, 2021, as part of its periodic review of our governing documents, our board of directors approved amendments to our amended and restated bylaws, to require the full board of directors (not a subcommittee of the board) to authorize the issuance of any voting stock.

The foregoing description of the changes is qualified in its entirety by reference to the full text of our amended and restated bylaws, a copy of which is attached as Exhibit 3.2 and incorporated by reference.

Snap’s amended and restated bylaws reflecting those amendments became effective immediately on approval by the board of directors.

We are including this disclosure in this Form 10-K rather than filing a Form 8-K under Item 5.03 at a later date.

2021 Discretionary Bonus Program

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There is no set formula for determining the bonus amount under the 2021 Bonus Program based on the achievement of the corporate objectives and key results.

Rather, the compensation committee will exercise its discretion in determining the

bonus amount actually earned by each participant.

Rather, the compensation committee will exercise its discretion in determining the bonus amount actually earned by each participant.

Awards under the 2021 Bonus Program are expected to occur in the first quarter of 2022.

A participant must remain an employee on the payment date under the 2021 Bonus Program to be eligible to earn a bonus.

The description of the 2020 Bonus Program does not purport to be complete and is qualified in its entirety by reference to the 2020 Bonus Program, a copy of which is attached as Exhibit 10.22 and is incorporated by reference herein.

The description of the 2021 Bonus Program does not purport to be complete and is qualified in its entirety by reference to the 2021 Bonus Program, a copy of which is attached as Exhibit 10.22 and incorporated by reference.

We are including this disclosure in this Form 10-K rather than filing a Form 8-K under Item 5.02 at a later date.

New Employment Agreement and Transition Agreement

On February 3, 2021, we entered into a new employment agreement and transition agreement with Jared Grusd.

Under the agreement, Mr.

Grusd will enter into a new fixed term employment agreement that will include continued vesting of a portion of his previously granted equity.

In addition, following execution of a standard release, Mr.

Grusd will receive acceleration of his outstanding equity awards that were scheduled to vest through March 15, 2021, and his salary had he remained our Chief Strategy Officer through March 31, 2021.

The foregoing description is qualified in its entirety by reference to the full text of the transition agreement, a copy of which is attached as Exhibit 10.30 and incorporated by reference.

We are including this disclosure in this Form 10-K rather than filing a Form 8-K under Item 5.02 at a later date.

Directors, Executive Officers and Corporate Governance.

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Director and Chairman of the Board

Kelly Coffey (3)

Joanna Coles ( 2 )

Liz Jenkins (3)

Lafley ( 1 )( 2)

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Poppy Thorpe (1)( 3 )

Christopher Young

Member of the audit committee.

Member of the compensation committee.

Member of the nominating and corporate governance committee.

Member of the audit committee.

Executive Officers

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Prior to that, Mr.

Grusd served as Chief Executive Officer of HuffPost (formerly Huffington Post) since September 2015.

Grusd served as Chief Executive Officer of HuffPost (formerly Huffington Post) from September 2015 to June 2017 .

From October 2011 to September 2015, Mr.

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From August 2010 to October 2016, Mr.

Hunter served as Vice President of Infrastructure at Amazon, and previously as Vice President of Corporate Applications at Amazon from October 2007 to August 2010.

Hunter served as Vice President of Infrastructure at Amazon.com, Inc., and previously as Vice President of Corporate Applications at Amazon from October 2007 to August 2010.

Hunter holds a B.S.

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from January 2004 until May 2017, and as CEO of Sony Corporation of America from March 2012 to August 2017.

Lynton has served as a member of the board of directors of Ares Management, L.P.

since 2014, Pearson since February 2018, and Warner Music Group Corp.

since February 2019.

Lynton has served as a member of the board of directors of Ares Management, L.P., Pearson, Warner Music Group Corp., Schrodinger, Inc., and The Boston Beer Company.

Lynton also served as a member of the board of directors of Pandora Media, Inc.

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Lynton is qualified to serve as a member of our board of directors and Chairman due to his extensive leadership experience.

Kelly Coffey .

Coffey has served on our board of directors since May 2020.

Coffey has served as Chief Executive Officer at City National Bank, a subsidiary of the Royal Bank of Canada (RBC), since February 2019.

Prior to joining City National Bank, Ms.

Coffey served in various leadership positions with J.P.

Morgan from 1989 to January 2019, most recently serving as the Chief Executive Officer of J.P.

Morgan’s U.S.

Private Bank.

Coffey holds an M.S.

in Foreign Service from Georgetown University and a B.A.

in International Affairs & French from Lafayette College.

We believe that Ms.

Coffey is qualified to serve as a member of our board of directors due to her extensive leadership experience.

Joanna Coles.

Coles has served on our board of directors since December 2015.

Coles was appointed Chief Content Officer of Hearst Magazines in September 2016, overseeing editorial for Hearst’s 300 titles globally, and served until August 2018.

Prior to that she was Editor-in-Chief of Cosmopolitan, a role she started in September 2012.

Coles has served as Chairperson and Chief Executive Officer of Northern Star Acquisition Corp.

and Northern Star Acquisition Corp.

II, or collectively Northern Star, since July 2020 and December 2020, respectively.

Prior to joining Northern Star, Ms.

Coles served as Chief Content Officer of Hearst Magazines from September 2016 to August 2018, overseeing editorial for Hearst’s 300 titles globally, and as Editor-in-Chief of Cosmopolitan from September 2012 to September 2016.

She edited Marie Claire magazine from April 2006 to September 2012.

Coles worked for The Times of London from September 1998 to September 2001 and served as New York Bureau Chief for The Guardian from 1997 to 1998.

She is on the board of Women Entrepreneurs New York City, an initiative to encourage female entrepreneurship, with a focus on underserved communities.

She currently serves on the board of directors of Sonos, Inc., and is on the board of Women Entrepreneurs New York City, an initiative to encourage female entrepreneurship, with a focus on underserved communities.

Coles holds a B.A.

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Coles is qualified to serve as a member of our board of directors due to her extensive experience working with content providers and advertisers.

Liz Jenkins .

Jenkins has served on our board of directors since December 2020.

Jenkins has served as Chief Operating Officer at Be Sunshine, LLC (Hello Sunshine) since January 2021, and served as Chief Financial Officer at Be Sunshine, LLC (Hello Sunshine from August 2018 to December 2020 .

Prior to joining Hello Sunshine, Ms.

Jenkins worked at Sony Interactive Entertainment as the Head of Strategic Ventures for PlayStation from June 2017 to August 2018, the Creative Cartel as interim Co-Chief Executive Officer from October 2015 to June 2016, and Media Rights Capital from October 2008 to May 2015, most recently serving as Senior Vice President of Corporate Development and Strategy.

She currently serves on the board of GLAAD.

Jenkins holds an MBA from The Wharton School at the University of Pennsylvania and a BA in Economics from Stanford University.

We believe that Ms.

Jenkins is qualified to serve as a member of our board of directors due to her extensive leadership experience and e xperience working with content providers.

Lafley has served on our board of directors since July 2016.

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Meresman has served on the boards of directors of various public and private companies, including service as chair of the audit committee for some of these companies.

He currently serves on the board of directors and as chair of the audit committee of Cloudflare, Inc., Guardant Health, Inc.

, and Medallia, Inc.

He currently serves on the board of directors and as chair of the audit committee of Cloudflare, Inc., DoorDash, Inc., Guardant Health, Inc., and Medallia, Inc.

He served as a member of the board of directors and as chair of the audit committees of Palo Alto Networks, Inc.

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Thorpe has served on our board of directors since August 2018.

Thorpe has served as Head of Brand Marketing at Glossier Inc., a beauty brand, since April 2018.

Thorpe has served as Chief Marketing Officer at Sesame Inc.

since March 2020.

Prior to that, Ms.

Thorpe was Head of Strategy at FNDR, a marketing and advertising agency, from August 2017 to April 2018.

Prior to FNDR, from August 2014 until August 2017, Ms.

Thorpe was Strategy Director at R/GA, a digital agency.

Prior to R/GA, Ms.

Thorpe was a freelance strategy director.

Thorpe served as Head of Brand Marketing at Glossier Inc., a beauty brand, from April 2018 to February 2020, Head of Strategy at FNDR, a marketing and advertising agency, from August 2017 to April 2018, and Strategy Director at R/GA, a digital agency, from August 2014 to August 2017.Ms.

Thorpe holds a B.A.

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Thorpe is qualified to serve as a member of our board of directors due to her experience working with digital and technology companies and with advertisers.

Christopher Young .

Young has served on our board of directors since October 2016.

Since April 2017, Mr.

Young has served as CEO of McAfee, LLC.

He joined Intel Corporation as Senior Vice President and General Manager, Intel Security Group in October 2014, and later led the initiative to spin out McAfee, one of the largest, pure-play cybersecurity brands in the world.

From November 2011 to September 2014, Mr.

Young served as Senior Vice President, Security and Government Group at Cisco Systems, Inc., a technology networking company.

Young serves as a member of the President’s National Security Telecommunications Advisory Committee and on the board of the non-profit Cyber Threat Alliance.

Earlier in his career, he led cybersecurity efforts at RSA (a division of Dell EMC) and AOL.

He also led end user computing at VMware and cofounded Cyveillance.

Young has served on the board of directors of American Express since March 2018.

From January 2011 to August 2016, he was a board member of Rapid7, Inc.

and has also served on the Board of Trustees of Princeton University.

Young holds an A.B.

degree cum laude from Princeton University and an M.B.A.

degree with distinction from the Harvard Business School.

We believe that Mr.

Young is qualified to serve as a member of our board of directors due to his extensive experience with technology companies.

There are no family relationships among any of the directors or executive officers.

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Our board of directors may establish the authorized number of directors from time to time by resolution.

Our board of directors consists of nine members.

Our board of directors currently consists of ten members.

No stockholder has any special rights regarding the election or designation of members of our board of directors.

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Our board of directors held five meetings during 2020.

No member of our board of directors attended fewer than 75% of the aggregate of (i) the total number of meetings of the board of directors (held during the period for which he or she was a director) and (ii) the total number of meetings held by all committees of the board of directors on which such director served (held during the period that such director served).

No member of our board of directors attended fewer than 75% of the aggregate of (a) the total number of meetings of the board of directors (held during the period for which he or she was a director) and (b) the total number of meetings held by all committees of the board of directors on which such director served (held during the period that such director served).

Members of our board of directors are invited and encouraged to attend our annual meeting of stockholders.

In 2019, seven members of our board of directors attended our annual meeting of stockholders.

In 2020, all members of our board of directors attended our annual meeting of stockholders.

Executive Sessions of Independent Directors

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Our board of directors has established an audit committee, a compensation committee, and a nominating and corporate governance committee.

The composition and responsibilities of each of the committees of our board of directors are described below.

The composition and responsibilities of each of these committees of our board of directors are described below.

Members serve on these committees until their resignation or until otherwise determined by our board of directors.

Our board of directors may establish other committees as it deems necessary or appropriate from time to time.

Our board of directors may have or establish other committees as it deems necessary or appropriate from time to time.

Audit Committee

Our audit committee consists of Mr.

Our audit committee consists of Ms.

Meresman, Mr.

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Thorpe, each of whom our board of directors has determined satisfies the independence requirements under NYSE listing standards and Rule 10A-3(b)(1) of the Exchange Act.

The chair of our audit committee is Mr.

Lynton was a member of the audit committee until December 2020.

The chair of our audit

committee is Mr.

Meresman, who our board of directors has determined is an “audit committee financial expert” within the meaning of SEC regulations.

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Meresman, simultaneously serves on the audit committees of more than three public companies.

Meresman currently serves on the audit committees of three other public companies, in addition to our company.

Meresman currently serves on the audit committees of four other public companies, in addition to our company.

Our board of directors has determined that such simultaneous service would not impair the ability of Mr.

Meresman to effectively serve on our audit committee.

During 2019, the audit committee met six times.

During 2020 , the audit committee met nine times.

Our board of directors has adopted a written charter for the audit committee, which is available on our website at www.snap.com.

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reviewing and establishing general policies relating to compensation and benefits of our employees, including our overall compensation philosophy.

See the sections titled “Compensation Discussion and Analysis” and “Director Compensation” for a description of our processes and procedures for the consideration and determination of executive officer and director compensation.

See the sections titled “Item 11.

Executive Compensation—Compensation Discussion and Analysis” and “—Director Compensation” for a description of our processes and procedures for the consideration and determination of executive officer and director compensation.

Nominating and Corporate Governance Committee

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Our board of directors has determined that each member of the nominating and corporate governance committee is independent under the NYSE listing standards, a non-employee director, and free from any relationship that would interfere with the exercise of his or her independent judgment.

During 2019, the nominating and corporate governance committee met five times.

During 2020, the nominating and corporate governance committee met four times.

Our board of directors has adopted a written charter for the nominating and corporate governance committee, which is available on our website at www.snap.com.

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The factors generally considered by the nominating and corporate governance committee and our board of directors are set out in our Corporate Governance Guidelines, which are available on our website at www.snap.com.

If a stockholder who is eligible to vote at the 2020 annual meeting of stockholders wishes to nominate a candidate to be considered for election as a director, it must comply with the procedures set forth in our by-laws and give timely notice of the nomination in writing to our Secretary.

If a stockholder who is eligible to vote at the 2021 annual meeting of stockholders wishes to nominate a candidate to be considered for election as a director, it must comply with the procedures set forth in our bylaws and give timely notice of the nomination in writing to our Secretary.

All stockholder proposals should be marked for the attention of our Secretary at Snap Inc., 2772 Donald Douglas Loop North, Santa Monica, CA 90405.

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Derek Andersen, Chief Financial Officer;

Jeremi Gorman, Chief Business Officer;

Jerry Hunter, Senior Vice President, Engineering;

Rebecca Morrow, Chief Accounting Officer and Controller;

Michael O’Sullivan, General Counsel .

Tim Stone, former Chief Financial Officer;

Lara Sweet, former interim Chief Financial Officer.

Our board of directors has delegated to the compensation committee the authority and responsibility for reviewing, evaluating, and determining the compensation to be paid to executive officers, overseeing our compensation policies, and administering the compensation plans and programs for Snap.

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Our focus on equity compensation encourages executives to operate like owners, linking their interests with the interests of our stockholders.

We have an annual discretionary performance-based bonus that can be paid in cash or equity;

however, no amounts were awarded in 2019.

In 2020, we introduced an annual incentive compensation program .

As our company grows, we will continue to evaluate our compensation philosophy and programs to ensure they continue to meet our objectives.

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In 2020, the compensation committee requested that FW Cook perform a detailed review of our peer group, considering appropriateness of the current peer companies and potential additions based on similarity in market capitalization size and industry.

Based on those considerations and FW Cook’s review, our compensation committee approved removing Pandora, Netflix, Salesforce.com, Paypal, and Booking Holdings.

Based on those considerations and FW Cook’s review, our compensation committee approved removing Facebook, eBay, and TripAdvisor, and adding DocuSign, Pinterest, Slack, and Twilio.

Our peer group for 2020 consisted of the following companies:

IAC/InterActive

Electronic Arts

IAC/InterActive

We use the peer group as a general reference.

In addition to the peer group, we also rely on the knowledge and experience of our compensation committee members and our management in determining the appropriate compensation levels for our executive officers.

Elements of Executive Compensation

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equity-based awards;

annual incentive compensation;

other benefits.

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The table below sets forth information regarding the year-end base salary amounts for 2020 for our named executive officers.

No base salaries were changed for any of our executive officers in 2019, other than an increase for Ms.

Sweet in February 2019 following her appointment as interim Chief Financial Officer and for Mr.

Andersen in May 2019 in connection with his appointment as Chief Financial Officer.

No base salaries were changed for any of our named executive officers in 2020.

2020 Base Salary

Derek Andersen

Rebecca Morrow (2)

Jeremi Gorman

Michael O’Sullivan

Tim Stone (3)

Lara Sweet (4)

Andersen was appointed as Chief Financial Officer effective May 20, 2019.

Morrow joined us as Chief Accounting Officer and Controller effective September 3, 2019.

Morrow’s base salary was approved by our compensation committee in connection with her hire.

Stone served as Chief Financial Officer until January 25, 2019.

Sweet served as interim Chief Financial Officer from January 26, 2019 until May 19, 2019.

Equity-based Awards

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We also consider each executive officer’s individual performance, including the results and contributions delivered during the year and how they align with our short-term and long-term goals, the executive’s leadership of his or her team, the cash compensation received by the executive officer, and feedback received from the executive officer’s peers and team.

Based on such factors, Messrs.

Andersen, Hunter, and O’Sullivan and Ms.

Sweet received additional equity awards in 2019 as set forth in the section titled “—Grants of Plan-Based Awards in Fiscal 2019.” Ms.

Morrow received an equity award in connection with her hire.

Discretionary Performance-based Awards

We reserve the discretion to approve performance-based awards in cash or equity in the future to our executive officers based on each executive officer’s individual performance, our overall performance, and the recommendations of our Chief Executive Officer.

Annual Incentive Compensation

In February 2020, our board of directors approved the 2020 Bonus Program, which provided our named executive officers and other eligible employees the opportunity to earn bonuses on the level of achievement of certain company-wide objectives and key results, or Corporate OKRs, from January 1, 2020 through December 31, 2020.

A participant must have remained an employee through the payment date under the 2020 Bonus Program to have earned a bonus.

The Corporate OKRs are approved by the compensation committee.

Each Corporate OKR category is assigned a relative weighting by the compensation committee based on recommendations by the Chief Executive Officer, reflecting its importance to the achievement of our Corporate OKRs during the year.

Each eligible participant in the 2020 Bonus Program may receive a bonus in an amount up to 100% of such participant’s annual base salary earned in 2020.

Bonus targets for participants will be correspondingly adjusted downward in the event certain Corporate OKRs are deemed by the compensation committee to have not been fully achieved.

The compensation committee also has the right, in its sole discretion, to adjust the bonus target of any participant upward in the event of over-achievement of the Corporate OKRs as determined by the compensation committee.

The Corporate OKRs consisted of growing the overall business, including growing our community, growing our business internationally while supporting local businesses, investing in partnerships to scale our platforms, and accelerating revenue growth and making progress towards adjusted EBITDA profitability.

In February 2021, the c ompensation c ommittee approved a n 80 % payment of the bonus target amount to certain of our employees, including our named executive officers, pursuant to the 2020 Bonus Program.

The bonus payment amounts approved by the c ompensation c ommittee were based on their respective determinations of the degree to which such Corporate OKR s were achieved.

Other Benefits

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Spiegel, participated in our 401(k) plan.

Our executive officers, including our named executive officers , also receive access to an on-call medical service paid for by us.

O’Sullivan participated in such on-call medical services in 2019, and we paid applicable tax gross ups related to such service.

Our executive officers, including our named executive officers , also receive access to an on-call medical service and a medical advisor service paid for by us.

Gorman and Messrs.

Hunter and O’Sullivan participated in such on-call medical services in 2020, and Mr.

Andersen participated in the medical advisor service in 2020, and we paid applicable tax gross ups related to such services.

We generally do not provide our executive officers with additional retirement benefits, pensions, perquisites, or other personal benefits, except as further described in the section titled “—Summary Compensation Table.” In the future, we may provide perquisites or other personal benefits in limited circumstances, such as where we believe it is appropriate to assist an individual executive in the performance of his or her duties, to make our executive team more efficient and effective, and for recruitment, motivation, or retention purposes.

All future practices with respect to perquisites or other personal benefits for executives will be subject to review and approval by the compensation committee.

In connection with Ms.

Morrow’s employment and in accordance with our relocation policies, we provided her with certain relocation benefits to assist with her relocation to the Los Angeles area.

Please see the section titled “—Summary Compensation Table” for more information.

Executive Security Policy

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We ceased issuing back-weighted equity awards in early 2018, and Messrs.

Hunter and O’Sullivan and Ms.

Sweet are the only named executive officers with back-weighted equity vesting that could benefit from such a provision.

Hunter and O’Sullivan are the only named executive officers with back-weighted equity vesting that could benefit from such a provision.

Our named executive officers are not entitled to any other change of control benefits or post-employment payments with the limited exception of equity acceleration on a termination due to death.

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As a newly public company , we may benefit from a transition rule under Section 162(m) so that deduction limits generally do not apply to compensation paid pursuant to equity plans and arrangements that were in effect at the time of our IPO, subject to certain exceptions.

Because of uncertainties as to the application and interpretation of Section 162(m) and the proposed regulations recently issued thereunder, no assurance can be given that any compensation paid by us will be deductible.

Because of uncertainties as to the application and interpretation of Section 162(m), no assurance can be given that any compensation paid by us will be deductible.

We will continue to monitor the applicability of Section 162(m) to our ongoing compensation arrangements.

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We account for stock-based compensation in accordance with the authoritative guidance set forth in ASC Topic 718, which requires companies to measure and recognize the compensation expense for all share-based awards made to employees and directors, including RSAs, RSUs, and stock options, over the period during which the award recipient is required to perform services in exchange for the award.

For executive officers, this is generally the four-year vesting period of the award.

Compensation Policies and Practices as they Relate to Risk Management

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The base salary component of our compensation program is designed to provide income independent of our stock price performance so that employees will not focus exclusively on stock price performance to the detriment of other important business metrics.

The annual bonus component is scored with discretion by the compensation committee so that short-term outcomes are not over-weighted in the final results.

The equity-based component of our compensation program is primarily designed to reward employees evenly throughout their tenure, which we believe discourages employees from taking actions that focus only on specific periods.

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Summary Compensation Table

The following table presents all of the compensation awarded to or earned by or paid to our named executive officers during the fiscal years ended December 31, 2019, 2018, and 2017.

The following table presents all of the compensation awarded to, earned by, or paid to our named executive officers during the fiscal years ended December 31, 2020, 2019, and 2018.

Name and Principal Position

Stock Awards (1)

Non-Equity Incentive Plan Compensation

All Other Compensation

Co-Founder and Chief Executive Officer

Co-Founder and Chief

Executive Officer

Derek Andersen (5)

Chief Financial Officer

Senior Vice President, Engineering

Rebecca Morrow (10)

Chief Accounting Officer

Jeremi Gorman (9)

Chief Business Officer

Senior Vice President,

Michael O'Sullivan

General Counsel

Tim Stone (15)

Former Chief Financial Officer

Lara Sweet (18)

Former interim Chief Financial Officer

Amounts reported represent the aggregate grant date fair value of the equity awards without regard to forfeitures, calculated in accordance with ASC Topic 718.

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Spiegel cannot reimburse under the Federal Aviation Regulations, (c) $407,062 in incremental costs for personal flights not reimbursed by Mr.

Spiegel, and (d) $6 in life insurance premiums paid by us on behalf of Mr.

Amount reported includes (a) $1,276,623 for security for Mr.

Spiegel, (b) $13,864 of imputed income relating to incremental costs of family or guests accompanying Mr.

Spiegel on business flights that Mr.

Spiegel cannot reimburse under the Federal Aviation Regulations, (c) $378,472 in incremental costs for personal flights not reimbursed by Mr.

Spiegel, (d) life insurance premiums paid by us on behalf of Mr.

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Amounts not quantified above total less than $10,000 in aggregate.

Amount reported represents a one-time performance award granted to Mr.

Spiegel in connection with our initial public offering in March 2017.

Amount reported includes (a) accrued vacation as of May 31, 2017, which amount was paid out as a result of our transition to a flexible vacation policy, (b) $294,242 for our payment of the fees associated with Mr.

Spiegel’s filing in 2017 under the HSR Act including legal fees incurred in connection with the filing, otherwise payable by Mr.

Spiegel, as approved by the compensation committee of our board of directors in November 2017, (c) $211,124 in related tax “gross up” payments paid to Mr.

Spiegel to cover the imputed income associated with the 2017 HSR Act filing fee and legal fees, (d) $561,892 for security for Mr.

Spiegel, (e) medical and dental premiums paid by us on behalf of Mr.

Spiegel, and (f) tax “gross up” payments paid to Mr.

Spiegel to cover the imputed income associated with the medical and dental premiums.

Amounts not quantified above total less than $10,000 in aggregate.

Andersen was appointed as Chief Financial Officer effective May 20, 2019.

Represents amounts earned under the 2020 Bonus Program for performance from January 1, 2020 through December 31, 2020.

Amounts under the 2020 Bonus Program will be paid in March 2021.

See “Elements of Executive Compensation – Annual Incentive Compensation.”

Amount reported includes (a) $11,400 in 401(k) plan matching contributions by us, (b) life insurance premiums paid by us on behalf of Mr.

Andersen, (c) $6,750 in medical advisor services paid by us on behalf of Mr.

Andersen, (d) tax “gross up” payments paid to Mr.

Andersen to cover the imputed income associated with the medical advisor services.

Amounts not quantified above total less than $10,000 in aggregate.

Amount reported includes (a) $9,788 in 401(k) plan matching contributions by us, (b) life insurance premiums paid by us on behalf of Mr.

Andersen, (c) $420 in a financial services program provided to executives, (d) tax “gross up” payments paid to Mr.

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Amounts not quantified above total less than $10,000 in aggregate.

Gorman joined us as Chief Business Officer effective November 5, 2018.

Amount reported includes (a) $6,154 in 401(k) plan matching contributions by us, (b) life insurance premiums paid by us on behalf of Ms.

Gorman, (c) $5,000 in medical on-call services paid by us on behalf of Ms.

Gorman, and (d) tax “gross up” payments paid to Ms.

Gorman to cover the imputed income associated with the medical on-call services.

Amounts not quantified above total less than $10,000 in aggregate.

Amount reported includes (a) $6,692 in 401(k) plan matching contributions by us, (b) life insurance premiums paid by us on behalf of Ms.

Gorman, (c) $5,000 in medical on-call services paid by us on behalf of Ms.

Gorman, and (d) tax “gross up” payments paid to Ms.

Gorman to cover the imputed income associated with the medical on-call services.

Amounts not quantified above total less than $10,000 in aggregate.

Amount reported includes (a) $11,400 in 401(k) plan matching contributions by us, (b) life insurance premiums paid by us on behalf of Mr.

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Hunter, (c) $5,000 in medical on-call services paid by us on behalf of Mr.

Hunter, and (d) tax “gross up” payments paid to Mr.

Hunter to cover the imputed income associated with the medical on-call services.

Amounts not quantified above total less than $10,000 in aggregate.

Amount reported includes (a) $11,000 in 401(k) plan matching contributions by us, (b) life insurance premiums paid by us on behalf of Mr.

Hunter, (c) $5,000 in medical on-call services paid by us on behalf of Mr.

Hunter, (d) meal allowance provided by us, and (e) tax “gross up” payments paid to Mr.

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Amounts not quantified above total less than $10,000 in aggregate.

Morrow joined us as Chief Accounting Officer and Controller effective September 3, 2019.

Amount reported includes (a) $1,585 in 401(k) plan matching contributions by us, (b) life insurance premiums paid by us on behalf of Ms.

Morrow, (c) $420 in a financial services program provided to executives, (d) tax “gross up” payments paid to Ms.

Morrow to cover the imputed income associated with the financial services program, (e) $45,000 in relocation expenses paid by us on behalf of Ms.

Morrow, and (f) $26,713 in tax “gross up” payments paid to Ms.

Morrow to cover the imputed income associated with the relocation expenses.

Amount reported includes (a) $6,962 in 401(k) plan matching contributions by us, (b) life insurance premiums paid by us on behalf of Mr.

O’Sullivan, (c) $5,000 in medical on-call services paid by us on behalf of Mr.

O’Sullivan, and (d) tax “gross up” payments paid to Mr.

O’Sullivan to cover the imputed income associated with the medical on-call services.

Amounts not quantified above total less than $10,000 in aggregate.

O’Sullivan joined us as General Counsel effective July 31, 2017.

Amount reported includes (a) $6,923 in 401(k) plan matching contributions by us, (b) life insurance premiums paid by us on behalf of Mr.

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Amounts not quantified above total less than $10,000 in aggregate.

Stone served as Chief Financial Officer until January 25, 2019 and terminated his employment on February 5, 2019.

Amount reported is the aggregate modification date fair value of previously granted equity awards in accordance with ASC Topic 718.

This amount does not reflect a new award or the actual economic value that may be realized by Mr.

Amount reported includes (a) $663,303 in relocation expenses paid by us on behalf of Mr.

Stone, (b) $79,906 in tax “gross up” payments paid to Mr.

Stone to cover the imputed income associated with the relocation expenses, (c) $11,000 in 401(k) plan matching contributions by us, (d) $5,000 in medical on-call services paid by us on behalf of Mr.

Stone, (e) life insurance premiums paid by us on behalf of Mr.

Stone, (f) a nominal transportation gift card to Mr.

Stone, and (g) tax “gross up” payments paid to Mr.

Stone to cover the imputed income associated with the medical on-call services and the gift card.

Amounts not quantified above total less than $10,000 in aggregate.

Under the transition agreement entered into with Mr.

Stone in February 2019 in connection with his resignation from the company, we waived his obligation to reimburse us for his relocation expenses, including the associated tax “gross up” payments.

Sweet served as interim Chief Financial Officer from January 26, 2019 until May 19, 2019.

Amount reported includes (a) $7,636 in 401(k) plan matching contributions by us and (b) life insurance premiums paid by us on behalf of Ms.

Amounts not quantified above total less than $10,000 in aggregate.

Grants of Plan -Based Awards in Fiscal 2020

5 unchanged sentences

Derek Andersen

Rebecca Morrow

Jeremi Gorman

Michael O’Sullivan

4 unchanged sentences

For a discussion of the valuation of the equity awards, see Notes 1 and 4 of the notes to our consolidated financial statements.

The service-based condition will be satisfied for these RSUs in 48 equal monthly installments after each month of continuous service from February 15, 2019.

The service-based condition will be satisfied, and the forfeiture condition will lapse, as to 1/16th of the shares underlying this RSA after each quarter of continuous service from June 15, 2019.

The service-based condition will be satisfied, and the forfeiture condition will lapse, as to 1/16th of the shares underlying this RSA after each quarter of continuous service from May 15, 2019.

The service-based condition will be satisfied, and the forfeiture condition will lapse, as to 1/16th of the shares underlying this RSA after each quarter of continuous service from October 15, 2019.

Outstanding Equity Awards as of December 31, 2020

The following table presents information regarding outstanding equity awards held by our named executive officers as of December 31, 2020.

Other than the award granted to Mr.

Spiegel, all awards are for Class A common stock and were granted under our 2014 Plan, for awards granted before March 1, 2017, or our 2017 Plan, for awards granted on or after March 1, 2017.

All awards are for Class A common stock and were granted under our 2017 Plan.

Option Awards

6 unchanged sentences

Derek Andersen

Rebecca Morrow

Jeremi Gorman

Michael O’Sullivan

Tim Stone (13)

Each of our named executive officers, other than Mr.

Spiegel, holds equity awards that only vest, or the forfeiture condition only lapses, on the satisfaction of a service-based condition.

RSUs granted prior to 2017 also include a performance condition that was satisfied on the effective date of the registration statement filed in connection with our initial public offering in March 2017.

The service-based condition for each of our named executive officers is further described below.

1 unchanged sentence

The market value is based on the closing price of our Class A common stock on December 31, 2020, which was $50.07.

Each share of Class C common stock is convertible into one share of Class B common stock, and each share of Class B common stock is convertible into one share of Class A common stock, in each case at any time at the option of the holder or on certain transfers of such shares.

Spiegel was granted an award of RSUs for 37,447,817 shares of Class C common stock, as described in the section titled “ — Employment, Severance, and Change in Control Agreements —Offer Letters—Evan Spiegel .” These RSUs were fully vested on the closing of our initial public offering in March 2017 and are being delivered to Mr.

Spiegel in equal quarterly installments over three years that began in November 2017.

As of December 31, 2019, 9,361,955 shares underlying the RSUs with a market value of $152,880,725 ( based on the closing price of our Class A common stock on December 31, 2019) were remaining for delivery to Mr.

This RSU grant was a one-time performance award granted to Mr.

Spiegel in connection with our initial public offering in March 2017.

The service-based condition for these RSUs is satisfied in 48 equal monthly installments a fter each month of continuous service from August 15, 2018 .

1 unchanged sentence

The service-based condition will be satisfied, and the forfeiture condition will lapse, as to 1/16th of the shares underlying this RSA after each quarter of continuous service from June 15, 2019.

The service-based condition for these RSUs is satisfied as follows (in each case subject to continued service through each vesting date):

10% of the RSUs in equal quarterly installments during the 12-month period following October 24, 2016;

20% of the RSUs in equal quarterly installments during the 12-month period following October 24, 2017;

30% of the RSUs in equal quarterly installments during the 12-month period following October 24, 2018;

and 40% of the RSUs in equal quarterly installments during the 12-month period following October 24, 2019.

The unvested shares subject to these RSUs are subject to accelerated vesting as described in the section titled “—Employment, Severance, and Change in Control Agreements.”

The service-based condition will be satisfied, and the forfeiture condition will lapse for this RSA as follows (in each case subject to continued service through each date):

18.2% of the RSAs in equal quarterly installments during the 12-month period following November 15, 2021;

and 81.8% of the RSAs in equal quarterly installments during the 12-month period following November 15, 2022.

The service-based condition will be satisfied, and the forfeiture condition will lapse as to 1/48th of the shares underlying this RSA after each month of continuous service by Ms.

Gorman from December 15, 2018.

The service-based condition will be satisfied, and the forfeiture condition will lapse as to 1/4th of the shares underlying this RSA on February 15, 2023, subject to continuous service by Ms.

Gorman through such date.

Thereafter, the service-based condition will be satisfied, and the forfeiture condition will lapse as to 1/4th of the shares underlying this RSA after each quarter of continuous service by Ms.

Gorman from February 15, 2023.

The service-based condition for these RSUs is satisfied as follows (in each case subject to continued service through each vesting date):

10% of the RSUs on January 15, 2019;

20% of the RSUs in equal quarterly installments during the 12-month period following January 15, 2019;

20% of the RSUs i n equal quarterly installments during the 12-month p eriod following January 15, 2019;

30% of the RSUs in equal quarterly installments during the 12-month period following January 15, 2020;

and 40% of the RSUs in equal quarterly installments during the 12-month pe riod following January 15, 2021.

and 40% of the RSUs in equal quarterly installments during the 12-month period following January 15, 2021.

The unvested shares subject to these RSUs are subject to accelerated vesting as described in the section titled “—Employment, Severance, and Change in Control Agreements.”

The service-based condition for these options is satisfied as follows (in each case subject to continued service through each vesting date):

10% of the options in equal quarterly installments during the 12-month period following December 29, 2017;

10% of the options on December 29, 2018;

20% of the options in equal quarterly installments during the 12-month period following December 29, 2018;

3 unchanged sentences

The service-based condition will be satisfied, and the forfeiture condition will lapse, as to 1/16th of the shares underlying this RSA after each quarter of continuous service from May 15, 2019.

The service-based condition will be satisfied, and the forfeiture condition will lapse, as to 1/16th of the shares underlying this RSA after each quarter of continuous service from October 15, 2019.

The service-based condition will be satisfied, and the forfeiture condition will lapse for this RSA as follows (in each case subject to continued service through each date):

27.2% of the RSAs in equal quarterly installments during the 12-month period following November 15, 2020;

36.4% of the RSAs in equal quarterly installments during the 12-month period following November 15, 2021;

and 36.4% of the RSAs in equal quarterly installments during the 12-month period following November 15, 2022.

The service-based condition for these RSUs is satisfied as follows (in each case subject to continued service through each vesting date):

4 unchanged sentences

The unvested shares subject to these RSUs are subject to accelerated vesting as described in the section titled “—Employment, Severance, and Change in Control Agreements.”

Stone served as Chief Financial Officer until January 25, 2019.

The service-based condition for these RSUs is satisfied as follows (in each case subject to continued service through each vesting date):

10% of the RSUs in equal quarterly installments during the 12-month period following June 27, 2016;

20% of the RSUs in equal quarterly installments during the 12-month period following June 27, 2017;

30% of the RSUs in equal quarterly installments during the 12-month period following June 27, 2018;

and 40% of the RSUs in equal quarterly installments during the 12-month period following June 27, 2019.

The unvested shares subject to these RSUs are subject to accelerated vesting as described in the section titled “—Employment, Severance, and Change in Control Agreements.

The service-based condition for these RSUs is satisfied as follows (in each case subject to continued service through each vesting date):

10% of the RSUs in equal quarterly installments during the 12-month period following February 15, 2017;

20% of the RSUs in equal quarterly installments during the 12-month period following February 15, 2018;

30% of the RSUs in equal quarterly installments during the 12-month period following February 15, 2019;

and 40% of the RSUs in equal quarterly installments during the 12-month period following February 15, 2020.

The unvested shares subject to these RSUs are subject to accelerated vesting as described in the section titled “—Employment, Severance, and Change in Control Agreements.

The service-based condition for these RSUs is satisfied as follows (in each case subject to continued service through each vesting date):

10% of the RSUs in equal quarterly installments during the 12-month period following May 15, 2017;

20% of the RSUs in equal quarterly installments during the 12-month period following May 15, 2018;

30% of the RSUs in equal quarterly installments during the 12-month period following May 15, 2019;

and 40% of the RSUs in equal quarterly installments during the 12-month period following May 15, 2020.

The unvested shares subject to these RSUs are subject to accelerated vesting as described in the section titled “—Employment, Severance, and Change in Control Agreements.

The service-based condition for these RSUs is satisfied as follows (in each case subject to continued service through each vesting date):

10% of the RSUs in equal quarterly installments during the 12-month period following November 15, 2017;

20% of the RSUs in equal quarterly installments during the 12-month period following November 15, 2018;

30% of the RSUs in equal quarterly installments during the 12-month period following November 15, 2019;

and 40% of the RSUs in equal quarterly installments during the 12-month period following November 15, 2020.

The unvested shares subject to these RSUs are subject to accelerated vesting as described in the section titled “—Employment, Severance, and Change in Control Agreements.

The service-based condition for these RSUs is satisfied as follows (in each case subject to continued service through each vesting date):

10% of the RSUs in equal quarterly installments during the 12-month period following January 15, 2018;

20% of the RSUs in equal quarterly installments during the 12-month period following January 15, 2019;

30% of the RSUs in equal quarterly installments during the 12-month period following January 15, 2020;

and 40% of the RSUs in equal quarterly installments during the 12-month period following January 15, 2021.

The unvested shares subject to these RSUs are subject to accelerated vesting as described in the section titled “—Employment, Severance, and Change in Control Agreements.

The service-based condition will be satisfied, and the forfeiture condition will lapse for this RSA as follows (in each case subject to continued service through each date):

33.3% of the RSAs in equal quarterly installments during the 12-month period following November 15, 2021;

and 66.7% of the RSAs in equal quarterly installments during the 12-month period following November 15, 2022.

Option Exercises and Stock Vested

The following table presents information regarding options exercised by our named executive officers during 2019 and the vesting or lapse of the forfeiture condition during 2019 of RSUs and RSAs previously granted to the named executive officers.

Option Awards

Number of Shares Acquired on Exercise (#)

Value Realized on Exercise ($) (1)

The following table presents information regarding the vesting or lapse of the forfeiture condition during 2020 of RSUs and RSAs previously granted to the named executive officers.

No named executive officer exercised options during 2020.

Number of Shares Acquired on Vesting (#)

2 unchanged sentences

Derek Andersen

Rebecca Morrow

Jeremi Gorman

Michael O’Sullivan

The value realized on the exercise of an option represents the difference between the closing price of our Class A common stock on the date of exercise and the exercise price of the option, and does not necessarily reflect the sales price of the shares or if a sale had been made.

The value realized is based on the closing price of our Class A common stock on the vesting date.

Spiegel in equal quarterly installments over three years that began in November 2017.

In 2019, 12,482,605 shares of Class C common stock with an aggregate value of $164,676,769, based on the closing price of our Class A common stock on the applicable delivery dates, were delivered to Mr.

In 2020, 9,361,955 shares of Class C common

stock with an aggregate value of $ 173,820,297 , based on the closing price of our Class A common stock on the applicable delivery dates, were delivered to Mr.

Pension Benefits

Our named executive officers did not participate in, or otherwise receive any benefits under, any pension or retirement plan sponsored by us during the year ended December 31, 2019.

Other than our 401(k) plan, our named executive officers did not participate in, or otherwise receive any benefits under, any pension or retirement plan sponsored by us during the year ended December 31, 2020.

Non-qualified Deferred Compensation

8 unchanged sentences

In October 2016, we entered into an amended and restated offer letter agreement with Evan Spiegel, our co-founder and Chief Executive Officer, with respect to his continuing employment with us.

The offer letter provides for an annual base salary of $1.

Spiegel’s annual base salary as of December 31, 2020 was $1.

Under the terms of his offer letter, Mr.

Spiegel was granted an award of RSUs for 37,447,817 shares of Class C common stock, which represented 3.0% of our outstanding capital stock on an as-converted basis on the closing of our initial public offering in March 2017.

These RSUs were fully vested on the closing of our initial public offering and are being delivered to Mr.

These RSUs were fully vested on the closing of our initial public offering and were delivered to Mr.

Spiegel in equal quarterly installments over three years that began on November 30, 2017.

12 unchanged sentences

Grusd’s annual base salary as of December 31, 2020 was $ 500,000 .

In December 2017, we entered into an amended and restated offer letter agreement with Jerry Hunter, our Senior Vice President, Engineering, with respect to his continuing employment with us.

In October 2020, we entered into an amended and restated offer letter agreement with Jerry Hunter, our Senior Vice President, Engineering, with respect to his continuing employment with us.

Hunter’s annual base salary as of December 31, 2020 was $500,000 .

9 unchanged sentences

O’Sullivan must sign a release of claims agreement as a pre-condition of receiving this termination benefit.

In November 2017, we entered into an amended and restated offer letter agreement with Lara Sweet, who at the time was serving as our Chief Accounting Officer, with respect to her continuing employment with us.

Sweet’s annual base salary as of December 31, 2019 was $500,000.

Sweet’s employment is terminated without cause or she terminates her employment for good reason, within 12 months following a change in control, then the service-based vesting requirement for the RSUs granted prior to 2018 will be deemed satisfied with respect to 1/16th of the RSUs for each completed quarter of service since the vesting commencement date.

Sweet must sign a release of claims agreement as a pre-condition of receiving this termination benefit.

Transition Agreements

In February 2019, we entered into a transition agreement with Tim Stone, our former Chief Financial Officer.

Under the transition agreement, we waived his obligation to reimburse us for his relocation expenses and accelerated the vesting by ten days of an aggregate of 59,586 shares subject to unvested RSAs, RSUs, and stock options.

Potential Payments upon Change in Control or Death

The following table sets forth the estimated payments that would be received by the named executive officers if a hypothetical termination of employment without cause or following a resignation for good reason following a change of control of our company had occurred on December 31, 2019.

The following table sets forth the estimated payments that would be received by each named executive officer if a hypothetical termination of employment without cause or following a resignation for good reason following a change of control of our company had occurred on December 31, 2020.

Accelerated Vesting of RSUs (1)

Derek Andersen

Rebecca Morrow

Jeremi Gorman

Michael O’Sullivan

3 unchanged sentences

Derek Andersen

Rebecca Morrow

Jeremi Gorman

Michael O’Sullivan

11 unchanged sentences

We have the ability to make matching and discretionary contributions to the 401(k) plan.

Currently, we make a match of each participant’s contribution up to federal limits of the participant’s base salary, bonus, and commissions paid during the period, and we make match of 50% of each participant’s contribution between 3% and 5% of the participant’s base salary, bonus, and commissions paid during the period.

Currently, we make a match of each participant’s contribution up to federal limits of the participant’s base salary, bonus, and commissions paid during the period, and we make a match of 50% of each participant’s contribution between 3% and 5% of the participant’s base salary, bonus, and commissions paid during the period.

Contributions are allocated to each participant’s individual account and are then invested in selected investment alternatives according to the participants’ directions.

6 unchanged sentences

Our board of directors adopted our 2017 Equity Incentive Plan, or our 2017 Plan, in January 2017, and our stockholders approved our 2017 Plan in February 2017.

Our 2017 Plan became effective once the registration statement in connection with our initial public offering was declared effective.

Our 2017 Plan became effective once the registration statement in connection with our initial public offering was declared effective in March 2017.

Our 2017 Plan provides for the grant of incentive stock options to employees, including employees of any parent or subsidiary, and for the grant of nonstatutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance stock awards, performance cash awards, and other forms of stock awards to employees, directors, and consultants, including employees and consultants of our affiliates.

29 unchanged sentences

Our 2014 Plan allows for the grant of incentive stock options to employees, including employees of any parent or subsidiary, and for the grant of nonstatutory stock options, stock appreciation rights, restricted stock awards, and restricted stock units to employees, directors, and consultants, including employees and consultants of our affiliates.

Our 2017 Plan became effective on the execution of the underwriting agreement related to our initial public offering in March 2017.

Our 2017 Plan became effective once the registration statement in connection with our initial public offering was declared effective in March 2017.

As a result, we do not expect to grant any additional awards under the 2014 Plan following that date, other than awards for up to 2,500,000 shares of Class A common stock to our employees and consultants in France.

4 unchanged sentences

The maximum number of shares of Class A common stock that may be issued on the exercise of incentive stock options under our 2014 Plan is three times such maximum number of shares.

Shares subject to stock awards granted under our 2014 Plan that expire, are forfeited, or terminate without being exercised in full or are settled in cash do not reduce the number of shares available for issuance under our 2014 Plan.

Shares subject to stock awards granted under our 2014 Plan that expire, are forfeited, or terminate without being

exercised in full or are settled in cash do not reduce the number of shares available for issuance under our 2014 Plan.

Additionally, shares used to pay the exercise price of a stock award or to satisfy the tax withholding obligations related to a stock award become available for future grant under our 2014 Plan, although such shares may not be subsequently issued pursuant to the exercise of an incentive stock option.

2 unchanged sentences

(1) a sale of all or substantially all of our assets, (2) the sale or disposition of at least 90% of our outstanding securities, (3) the consummation of a merger or consolidation where we do not survive the transaction, and (4) the consummation of a merger or consolidation where we do survive the transaction but the shares of common stock outstanding before such transaction are converted or exchanged into other property by virtue of the transaction, unless otherwise provided in an award agreement or other written agreement between us and the award holder, the administrator may take one or more of the following actions with respect to such stock awards:

(1) arrange for the assumption, continuation or substitution of a stock award by a successor corporation, (2) arrange for the assignment of any reacquisition or repurchase rights held by us to a successor corporation, (3) accelerate the vesting, in whole or in part, of the stock award and provide for

its termination before the transaction, (4) arrange for the lapse, in whole or in part, of any reacquisition or repurchase rights held by us, (5) cancel or arrange for the cancellation of the stock award before the transaction in exchange for a cash payment, if any, determined by the board of directors, or (6) make a payment, in the form determined by the board of directors, equal to the excess, if any, of the value of the property the participant would have received on exercise of the stock award before the transaction over any exercise price payable by the participant in connection with the exercise.

(i) arrange for the assumption, continuation or substitution of a stock award by a successor corporation, (ii) arrange for the assignment of any reacquisition or repurchase rights held by us to a successor corporation, (iii) accelerate the vesting, in whole or in part, of the stock award and provide for its termination before the transaction, (iv) arrange for the lapse, in whole or in part, of any reacquisition or repurchase rights held by us, (v) cancel or arrange for the cancellation of the stock award before the transaction in exchange for a cash payment, if any, determined by the board of directors, or (vi) make a payment, in the form determined by the board of directors, equal to the excess, if any, of the value of the property the participant would have received on exercise of the stock award before the transaction over any exercise price payable by the participant in connection with the exercise.

The plan administrator is not obligated to treat all stock awards, even those that are of the same type, or all participants, in the same manner.

16 unchanged sentences

Shares subject to stock awards granted under our 2012 Plan that expire, are forfeited, or terminate without being exercised in full or are settled in cash do not reduce the number of shares available for issuance under our 2012 Plan.

Additionally, shares used to pay the exercise price of a stock award or to satisfy the tax withholding obligations related to a stock award become available for future grant under our 2012 Plan, although such shares may not be subsequently issued pursuant to the exercise of an incentive stock option.

Additionally, shares used to pay the exercise price of a stock award or to satisfy the tax

withholding obligations related to a stock award become available for future grant under our 2012 Plan, although such shares may not be subsequently issued pursuant to the exercise of an incentive stock option.

Corporate Transactions .

1 unchanged sentence

(1) arrange for the assumption, continuation, or substitution of a stock award by a successor corporation, (2) arrange for the assignment of any reacquisition or repurchase rights held by us to a successor corporation, (3) accelerate the vesting, in whole or in part, of the stock award and provide for its termination before the transaction, (4) arrange for the lapse, in whole or in part, of any reacquisition or repurchase rights held by us, (5) cancel or arrange for the cancellation of the stock award before the transaction in exchange

for a cash payment, if any, determined by the board of directors, or (6) make a payment, in the form determined by the board of directors, equal to the excess, if any, of the value of the property the participant would have received on exercise of the stock award before the transaction over any exercise price payable by the participant in connection with the exercise.

(i) arrange for the assumption, continuation, or substitution of a stock award by a successor corporation, (ii) arrange for the assignment of any reacquisition or repurchase rights held by us to a successor corporation, (iii) accelerate the vesting, in whole or in part, of the stock award and provide for its termination before the transaction, (iv) arrange for the lapse, in whole or in part, of any reacquisition or repurchase rights held by us, (v) cancel or arrange for the cancellation of the stock award before the transaction in exchange for a cash payment, if any, determined by the board of directors, or (vi) make a payment, in the form determined by the board of directors, equal to the excess, if any, of the value of the property the participant would have received on exercise of the stock award before the transaction over any exercise price payable by the participant in connection with the exercise.

The plan administrator is not obligated to treat all stock awards, even those that are of the same type, or all participants, in the same manner.

18 unchanged sentences

In the event of certain significant corporate transactions, including:

(1) a sale of all or substantially all of our assets, (2) the sale or disposition of 90% of our outstanding securities, (3) the consummation of a merger or consolidation where we do not survive the transaction, and (4) the consummation of a merger or consolidation where we do survive the transaction but the shares of our common stock outstanding immediately before such transaction are converted or exchanged into other property by virtue of the transaction, any then-outstanding rights to purchase our stock under the ESPP may be assumed, continued, or substituted for by any surviving or acquiring entity (or its parent company).

converted or exchanged into other property by virtue of the transaction, any then-outstanding rights to purchase our stock under the ESPP may be assumed, continued, or substituted for by any surviving or acquiring entity (or its parent company).

If the surviving or acquiring entity (or its parent company) elects not to assume, continue, or substitute for such purchase rights, then the participants’ accumulated payroll contributions will be used to purchase shares of our common stock within ten business days before such corporate transaction, and such purchase rights will terminate immediately.

13 unchanged sentences

Our bylaws also provide that, on satisfaction of certain conditions, we will advance expenses incurred by a director or officer in advance of the final disposition of any action or proceeding, and permit us to secure insurance on behalf of any officer, director, employee, or other agent for any liability arising out of his or her actions in that capacity regardless of whether we would otherwise be permitted to indemnify him or her under the provisions of Delaware law.

We have entered and expect to continue to enter into agreements to indemnify our directors, executive officers, and other employees as determined by the board of directors.

We have entered into, and expect to continue to enter into agreements to indemnify our directors, executive officers, and other employees as determined by the board of directors.

With certain exceptions, these agreements provide for indemnification for related expenses including attorneys’ fees, judgments, fines, and settlement amounts incurred by any of these individuals in any action or proceeding.

We believe that these certificate of incorporation and amended and restated bylaw provisions and indemnification agreements are necessary to attract and retain qualified persons as directors and officers.

We believe that these certificate of incorporation and bylaw provisions and indemnification agreements are necessary to attract and retain qualified persons as directors and officers.

We also maintain customary directors’ and officers’ liability insurance.

21 unchanged sentences

In 2020, we paid fees and made equity awards to our non-employee directors.

We granted each non-employee director (a) RSUs for 8,937 shares of Class A common stock under our 2017 Plan and (b) options to purchase 16,802 shares of Class A common stock under our 2017 Plan.

We granted each non-employee director (a) RSUs for 5,800 shares of Class A common stock under our 2017 Plan and (b) options to purchase 10,612 shares of Class A common stock under our 2017 Plan, with the exception of Ms.

Jenkins who joined our board of directors in 2020 after the equity awards were granted.

The service-based vesting condition will be fully satisfied for the RSUs and options on July 19, 2021.

6 unchanged sentences

Michael Lynton

Kelly Coffey (2)

Liz Jenkins (3)

Stanley Meresman

4 unchanged sentences

For a discussion of the valuation of the equity awards, including the assumptions used, see Notes 1 and 4 of the notes to our consolidated financial statements.

Includes $1,657 of imputed income relating to incremental costs of family or guests accompanying Mr.

Lynton on business flights that Mr.

Lynton cannot reimburse under the Federal Aviation Regulations, as approved by the compensation committee of our board of directors.

Amounts reported includes a $5,000 per month retainer for Mr.

Coffey joined the board of directors on May 18, 2020 and was granted (a) RSUs for 1,485 shares of Class A common stock under our 2017 Plan and (b) options to purchase 2,376 shares of Class A common stock under our 2017 Plan.

The service-based vesting condition for these additional RSUs and options was fully satisfied on July 18, 2020.

Jenkins joined the board of directors on December 10, 2020.

Amount reported includes a $5,000 per month retainer for Mr.

Lafley’s services on a special committee.

Murphy does not receive any compensation for service as a director.

Amounts reported represent (a) $1 for his base salary as an employee, (b) $5,000 in medical on-call services paid by us on behalf of Mr.

Murphy, (c) $420 in a financial services program provided to executives, (d) tax “gross up” payments paid to Mr.

Murphy to cover the imputed income associated with the medical on-call services and the financial services program, and (e) $21,026 for security for Mr.

Amounts not quantified above total less than $10,000 in aggregate.

Amounts reported includes a $5,000 per month retainer for Mr.

Amount reported represents (a) $1 for his base salary as an employee, (b) $ 52,819 for security for Mr.

Murphy, and (c) $6 for life insurance premiums paid by us on behalf of Mr.

Chris Young resigned from our board of directors on November 10, 2020.

Amount reported also includes a $5,000 per month retainer for Mr.

Young’s services on a special committee.

4 unchanged sentences

Stanley Meresman

Christopher Young

In 2020, we also provided Mr.

1 unchanged sentence

The executive administrative assistant would occasionally assist Mr.

Lynton with incidental personal matters, the cost of which to us being financially immaterial.

Lynton with incidental personal matters, the cost of which to us is financially immaterial.

Compensation Committee Interlocks and Insider Participation

2 unchanged sentences

Pay Ratio Disclosure

As disclosed in the Summary Compensation Table, for the year ended December 31, 2019, the annual total compensation of our CEO was $1,669,810.

The annual total compensation of our median employee, excluding our CEO, for the same period, using the same methodology used to calculate our CEO’s annual total compensation, was $305,733.

As disclosed in the Summary Compensation Table, for the year ended December 31, 2020, the annual total compensation of our Chief Executive Officer was $2,094,432.

The annual total compensation of our median employee, excluding our Chief Executive Officer, for the same period, using the same methodology used to calculate our Chief Executive Officer’s annual total compensation, was $256,061.

The ratio of these amounts is 8.2 to 1.

12 unchanged sentences

The table below sets forth information, as of December 31, 2020, with respect to the beneficial ownership of:

(i) our Class A common stock, Class B common stock, and Class C common stock by each named executive officer, each of our directors, and our directors and executive officers as a group;

and (ii) our Class B and Class C common stock by each person

or entity known by us to own beneficially more than 5% of our Class B common stock or Class C common stock (by number or by voting power).

(a) our Class A common stock, Class B common stock, and Class C common stock by each named executive officer, each of our directors, and our directors and executive officers as a group;

and (b) our Class B and Class C common stock by each person or entity known by us to own beneficially more than 5% of our Class B common stock or Class C common stock (by number or by voting power).

Because our Class A common stock is non-voting, significant holders of our Class A common stock are exempt from the obligation to file reports under Sections 13(d), 13(g), and 16 of the Exchange Act.

16 unchanged sentences

Derek Andersen (3)

Jeremi Gorman (4)

Jerry Hunter ( 5 )

Rebecca Morrow (5)

Michael O’Sullivan (6)

Tim Stone (7)

Lara Sweet (8)

Michael Lynton ( 7 )

Kelly Coffey (8)

Joanna Coles ( 9 )

Lafley (1 0 )

Stanley Meresman ( 11 )

Miller ( 12 )

Poppy Thorpe ( 13 )

Christopher Young (12)

All directors and executive officers as a group (16 persons) ( 14 )

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as noted above, holders of our Class A common stock, other than our directors or officers, are exempt from the obligation to file reports under Sections 13(d), 13(g), and 16 of the Exchange Act and may hold the stock in nominee or “street name” such that we are not able to identify their ownerships.

In November 2017, Tencent Holdings Limited notified us that it, together with its affiliates, acquired 145,778,246 shares of our non-voting Class A common

stock via open market purchases.

In November 2017, Tencent Holdings Limited notified us that it, together with its affiliates, acquired 145,778,246 shares of our non-voting Class A common stock via open market purchases.

Because Tencent is not obligated to disclose changes in its ownership of our Class A common stock, we cannot confirm whether it still owns such shares and there can be no assurance that you, or we, will be notified of any changes to their ownership of such shares.

Includes (a) 5,230,660 shares of Class A common stock and 5,862,410 shares of Class B common stock held in trust for which Mr.

Spiegel is trustee and holds voting power, (b) 123,203,552 shares of Class C common stock held by Mr.

Spiegel individually, and (c) 3,120,652 shares of Class C common stock that will be delivered to Mr.

Spiegel within 60 days of December 31, 2019.

Spiegel holds RSUs for 9,361,955 shares of Class C common stock that are fully vested and will be settled to shares in equal quarterly installments over the next year.

These shares are fully vested, but Mr.

Spiegel does not have the right to vote the 9,361,955 RSUs until they are settled to shares of Class C common stock.

If such undelivered shares were included in Mr.

Spiegel’s beneficial ownership (assuming no shares were withheld or sold to pay withholding taxes), at December 31, 2019, Mr.

Spiegel’s holdings would have represented 55.1% of the Class C common stock and 54.8% of the total voting power.

Includes (a) 5,862,410 shares of Class A common stock and 5,862,410 shares of Class B common stock held in trust for which Mr.

Murphy is trustee and holds voting power and (b) 107,943,924 shares of Class C common stock held by Mr.

Murphy individually.

Includes 5,230,660 shares of Class A common stock and 5,862,410 shares of Class B common stock held in trust for which Mr.

Spiegel is trustee and holds voting power.

Includes 5,862,410 shares of Class A common stock and 5,862,410 shares of Class B common stock held in trust for which Mr.

Murphy is trustee and holds voting power.

Includes (a) 832,324 shares of Class A common stock that are unvested and subject to forfeiture as of December 31, 2020 and (b) RSUs for 32,435 shares of Class A common stock for which the service-based vesting condition would be satisfied within 60 days of December 31, 2020.

Includes (a) 218,750 shares of Class A common stock that are unvested and subject to forfeiture as of December 31, 2019, but for which the service-based vesting condition would be satisfied with respect to 15,625 shares within 60 days of December 31, 2019, and (b) RSUs for 212,808 shares of Class A common stock for which the service-based vesting condition would be satisfied within 60 days of December 31, 2019 and (b) 210,000 shares of Class A common stock issuable upon exercise of stock options exercisable within 60 days of December 31, 2019.

Consists of 275,000 shares of Class A Common Stock, all of which are unvested and subject to forfeiture as of December 31, 2019, but for which the service-based vesting condition would be satisfied with respect to 17,187 shares within 60 days of December 31, 2019.

Includes (a) 656,250 shares of Class A common stock that are unvested and subject to forfeiture as of December 31, 2019, but for which the service-based vesting condition will be satisfied with respect to 46,875 shares within 60 days of December 31, 2019, and (b) RSUs for 79,904 shares of Class A common stock for which the service-based vesting condition would be satisfied within 60 days of December 31, 2019.

Stone served as Chief Financial Officer until January 25, 2019.

Includes (a) 656,250 shares of Class A common stock that are unvested and subject to forfeiture as of December 31, 2019, but for which the service-based vesting condition will be satisfied with respect to 46,875 shares within 60 days of December 31, 2019, and (b) RSUs for 11,062 shares of Class A common stock for which the service-based vesting condition would be satisfied within 60 days of December 31, 2019.

Includes 1,930,450 shares of Class A common stock that are unvested and subject to forfeiture as of December 31, 2020.

Includes (a) 1,610,546 shares of Class A common stock that are unvested and subject to forfeiture as of December 31, 2020, (b) RSUs for 26,241 shares of Class A common stock for which the service-based vesting condition would be satisfied within 60 days of December 31, 2020, (c) 420,000 shares of Class A common stock issuable upon exercise of stock options exercisable within 60 days of December 31, 2020, and (d) 443,902 shares held in trust for which Mr.

Hunter is trustee and holds dispositive power.

Includes (a) 865,377 shares of Class A common stock that are unvested and subject to forfeiture as of December 31, 2020 and (b) RSUs for 106,538 shares of Class A common stock for which the service-based vesting condition would be satisfied within 60 days of December 31, 2020.

Includes (a) 945,876 shares of Class A common stock for which Mr.

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Includes 2,376 shares of Class A common stock issuable upon exercise of stock options exercisable within 60 days of December 31, 2020.

Includes (a) RSUs for 6,782 shares of Class A common stock for which the service-based vesting condition would be satisfied within 60 days of December 31, 2019 and (b) 19,231 shares of Class A common stock issuable upon exercise of stock options exercisable within 60 days of December 31, 2019.

Includes (a) RSUs for 2,712 shares of Class A common stock for which the service-based vesting condition would be satisfied within 60 days of December 31, 2019 and (b) 19,231 shares of Class A common stock issuable upon exercise of stock options exercisable within 60 days of December 31, 2019.

Consists of (a) 1 69 , 126 , 047 shares of Class A common stock (of which 6,421,377 shares are unvested and subject to forfeiture as of December 31, 2019, but for which the service-based vesting condition will be satisfied with respect to 336,077 shares within 60 days of December 31, 2019 ), 11,724,820 shares of Class B common stock, and 231,147,476 shares of Class C common stock held by our current directors and executive officers or for which they serve as trustees, (b) RSUs for 337,353 shares of Class A common stock for which the service-based vesting condition would be satisfied within 60 days of December 31, 201 9, (c) 344,617 shares of Class A common stock issuable upon exercise of stock options exercisable within 60 days of December 31, 2019, and (d) RSUs for 3,120,652 shares of Class C common stock that are fully vested and will be settled to shares within 60 days of December 31, 2019.

Includes shares held by Ms.

Gorman and Mr.

Grusd, and excludes shares held by Mr.

Stone and Ms.

Sweet who were not executive officers as of December 31, 2019.

If all of Mr.

Spiegel’s undelivered shares of Class C common stock issuable pursuant to his CEO award were included in Mr.

Spiegel’s beneficial ownership (assuming no shares were withheld or sold to pay withholding taxes), at December 31, 2019, all directors and executive officers as a group would have represented 99.5% of the total voting power.

Includes 36,033 shares of Class A common stock issuable upon exercise of stock options exercisable within 60 days of December 31, 2020.

Includes (a) 172,243 shares held in trust for which Mr.

Lafley is trustee and holds dispositive power, and (b) 36,033 shares of Class A common stock issuable upon exercise of stock options exercisable within 60 days of December 31, 2020.

Includes 36,033 shares of Class A common stock issuable upon exercise of stock options exercisable within 60 days of December 31, 2020.

Includes 34,033 shares of Class A common stock issuable upon exercise of stock options exercisable within 60 days of December 31, 2020.

Consists of (a) 149,481,523 shares of Class A common stock (of which 7,168,504 shares are unvested and subject to forfeiture as of December 31, 2020, but for which the service-based vesting condition will be satisfied with respect to 436,330 shares within 60 days of December 31, 2020), 11,724,820 shares of Class B common stock, and 231,626,943 shares of Class C common stock held by our current directors and executive officers or for which they serve as trustees, (b) RSUs for 165,214 shares of Class A common stock for which the service-based vesting condition would be satisfied within 60 days of December 31, 2020, and (c) 636,574 shares of Class A common stock issuable upon exercise of stock options exercisable within 60 days of December 31, 2020.

Includes shares held by Mr.

Grusd and Ms.

Based on our corporate and transfer agent records.

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Following our initial public offering, we granted awards under our 2017 Plan, other than certain awards to our employees and consultants in France, which were granted under our 2014 Plan.

Consists of 9,361,955 shares of Class C common stock issuable upon settlement of the CEO award granted to Mr.

Certain Relationships and Related Transactions, and Director Independence.

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Investor Rights Agreement

In November 2013, we entered into an amended and restated investor rights agreement, which was amended in October 2016, with our founders and certain holders of our preferred stock, which provided the founders and those holders of preferred stock with certain registration rights, including the right to request that their shares be covered by a registration statement that we are otherwise filing.

The holders of up to an aggregate of 389,482,874 shares of our Class A common stock (including shares issuable on conversion of Class C common stock, which are initially convertible into Class B common stock) are entitled to rights with respect to the registration of their shares under the Securities Act under this agreement.

We are party to an amended and restated investor rights agreement, which provides Mr.

Spiegel and Mr.

Murphy with certain registration rights with respect to up to an aggregate of 360,463,699 shares of our Class A common stock (including shares issuable on conversion of Class C common stock, which are initially convertible into Class B common stock).

Under this agreement, Mr.

Spiegel and Mr.

Murphy have the right to request that their shares be covered by a registration statement that we are otherwise filing.

Munger, Tolles & Olson LLP

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We have in the past engaged the law firm Gibson, Dunn & Crutcher LLP, or Gibson, to provide certain legal services to us, and may do so in the future.

For the year ended December 31, 2019, total services provided by Gibson were $953,569.

Spiegel’s stepmother, Debra Wong Yang, is a partner at Gibson and has provided legal services to us.

For the year ended December 31, 2020, total services provided by Gibson were $119,719.

Entities Affiliated with Tencent

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Under the terms of this lease, Mr.

Spiegel’s entity leases the aircraft to us for no charge.

Spiegel’s entity leases the aircraft to us for $0.

We cover all the operating, maintenance, and insurance costs, and property taxes associated with the aircraft.

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The lease has a one-year term, which is automatically extended for successive one-year periods unless terminated by either party.

We use the hangar space to store and operate the aircraft.

We use the hangar space to store and operate the aircraft that we lease from Mr.

The underlying hangar lease expires in 2023.

In anticipation of that expiration, Mr.

Spiegel’s entity previously entered into a ground lease for a site on which it is required to build a new hangar.

In November 2020, we and Mr.

Spiegel’s entity entered into a twelve-year sublease for $0 allowing us to build and operate a new hangar on that site to support our aviation program, including the storage and operation of the aircraft that we lease from Mr.

We plan to construct the hangar prior to the expiration of the current hangar’s lease in 2023.

Spiegel’s entity will remain solely responsible for the ground lease rental payments, certain airport fees, and taxes, and is providing us with the existing plans and permits procured by Mr.

Spiegel for construction of the hangar.

In exchange for certain costs and ground lease payments that Mr.

Spiegel’s entity has incurred and will continue to incur, Mr.

Spiegel’s entity has the right to occupy space at the hangar that Snap does not require for its aviation program at a market rate determined at the time this arrangement was entered into.

As of December 31, 2020, Mr.

Spiegel’s entity had a credit balance of approximately $1.0 million that can be used for future rent or, to the extent not utilized by the end of the term, to purchase the hangar from Snap under the terms of the sublease.

No credit balance will be paid to Mr.

Spiegel in cash.

Subject to certain limited exceptions, neither party may terminate this sublease for a minimum of six years.

After this period, either party may terminate the sublease on 24 months’ notice to the other party.

Upon termination of the sublease, Mr.

Spiegel’s entity will purchase the hangar from Snap at its fair market value on the termination date.

The audit and compensation committees of our board of directors approved this arrangement based on their assessment that it is fair and reasonable to us.

Indemnification Agreements

Our amended and restated certificate of incorporation contains provisions limiting the liability of directors, and our amended and restated bylaws provide that we will indemnify each of our directors and officers to the fullest extent permitted under Delaware law.

Our amended and restated certificate of incorporation and amended and restated bylaws also provide our board of directors with discretion to indemnify our employees and other agents when determined appropriate by the board.

Our certificate of incorporation contains provisions limiting the liability of directors, and our bylaws provide that we will indemnify each of our directors and officers to the fullest extent permitted under Delaware law.

Our certificate of incorporation and bylaws also provide our board of directors with discretion to indemnify our employees and other agents when determined appropriate by the board.

In addition, we have entered into an indemnification agreement with each of our directors and executive officers, which requires us to indemnify them.

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Meresman, Mr.

Thorpe, and Mr.

Young do not have relationships that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that each of these directors is “independent” as that term is defined under the listing standards.

Miller, and Ms.

Thorpe do not have relationships that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that each of these directors is “independent” as that term is defined under the listing standards.

In making these determinations, our board of directors considered the current and prior relationships that each non-employee director has with our company and all other facts and circumstances our board of directors deemed relevant in determining their independence, including the beneficial ownership of our shares by each non-employee director and the transactions described above.

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Audit-Related Fees (2)

Tax Fees ( 3 )

All Other Fees ( 4 )

Audit fees consist of the fees for professional services rendered for the audit of our financial statements, audit of our internal control over financial reporting, review of our quarterly financial statements, filing of our registration statements, accounting consultations, and audits provided in connection with statutory filings.

Audit-related fees consist of fees for professional services rendered in connection with an internal controls review of an implementation of a new enterprise financial planning and reporting system.

Tax fees consist of the fees for professional services rendered in connection with tax compliance, tax advisory, and tax planning.

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Amended and Restated Bylaws of Snap Inc.

February 6, 2019

Form of Class A Common Stock Certificate

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August 9, 2019

Indenture, dated April 28, 2020, by and between Snap Inc.

Bank National Association, as Trustee

April 28, 2020

Form of Global Note, representing Snap Inc.’s 0.25% Convertible Senior Notes due 2025 (included as Exhibit A to the Indenture filed as Exhibit 4.7)

April 28, 2020

Amended and Restated 2012 Equity Incentive Plan

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2017 Equity Incentive Plan

Incorporated by Reference

Forms of restricted stock unit grant notice and award agreement under the Snap Inc.

2017 Equity Incentive Plan

August 10, 2017

Forms of restricted stock award grant notice and award agreement under the Snap Inc.

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October 26, 2018

Incorporated by Reference

2017 Employee Stock Purchase Plan

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Amended and Restated Offer Letter, by and between Snap Inc.

and Lara Sweet, dated November 6, 2017

November 8, 2017

Amended and Restated Offer Letter, by and between Snap Inc.

and Jerry Hunter, dated November 29, 2017

and Jerry Hunter, dated October 7, 2020

Offer Letter, by and between Snap Inc.

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2020 Bonus Program

February 5, 2020

2021 Bonus Program

Revolving Credit Agreement, by and among Snap Inc., Morgan Stanley Senior Funding Inc., Deutsche Bank AG Cayman Islands Branch, Goldman Sachs Bank USA, JPMorgan Chase Bank, N.A., Barclays Bank PLC, and Credit Suisse AG, Cayman Islands Branch, dated July 29, 2016

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August 9, 2019

Incorporated by Reference

Third Amendment to Revolving Credit Agreement, by and among Snap Inc.

the lenders party thereto, and Morgan Stanley Senior Funding Inc., as administrative agent, dated April 23, 2020

April 28, 2020

Non-Employee Director Compensation Policy

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October 26, 2018

Employment Agreement and Transition Agreement, by and between Snap Inc.

and Jared Grusd, dated February 3, 2021

List of Subsidiaries

Incorporated by Reference

Consent of Ernst & Young, LLP, independent registered public accounting firm

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(Principal Accounting Officer)

/s/ Kelly Coffey

February 4, 2021

/s/ Joanna Coles

February 4, 2021

/s/ Elizabeth Jenkins

February 4, 2021

Elizabeth Jenkins

February 4, 2021

/s/ Michael Lynton

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February 4, 2021

/s/ Christopher Young

February 4, 2020

Christopher Young

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures