Cellebrite DI .(CLBT)2025-03-18 11:04Financial Position - As of December 31, 2024, the company had cash and cash equivalents of $191.7 million, short-term deposits of $153.7 million, and short-term investments in marketable securities of $101.8 million[321]. - As of December 31, 2024, no credit losses have been recorded on the company's marketable securities investments[343]. Foreign Exchange Risk - A hypothetical 10% change in foreign currency exchange rates would have impacted the company's results of operations by $9.5 million and $8.3 million for the years ended December 31, 2024 and 2023, respectively[318]. - A 10% increase or decrease in current exchange rates would have affected the company's cash, cash equivalents, restricted cash, and short-term investment balances by $2.6 million and $3.1 million as of December 31, 2024 and 2023, respectively[320]. - The company has established a hedging program to reduce the impact of foreign exchange risks associated with forecasted future cash flows[318]. Corporate Governance and Management - The company is subject to various corporate governance requirements under the Companies Law, including the appointment of external directors[469]. - The board of directors consists of no less than three and no more than eleven directors, divided into three classes with staggered three-year terms[472]. - The company has a "foreign private issuer exemption" allowing it to comply with Israeli corporate governance practices instead of Nasdaq rules[470]. - The board of directors has determined that all directors, except Mr. Hogan, are independent as defined by Nasdaq corporate governance rules[479]. - The external directors were initially elected on November 29, 2021, and re-elected for a second three-year term on September 17, 2024[482]. - The lead independent director is responsible for presiding over meetings when the chairperson is absent and serving as a liaison between the chairperson and independent directors[499]. - The board of directors has adopted corporate governance guidelines to ensure compliance with applicable laws and regulations[498]. - The board of directors has established a compensation committee charter aligned with Nasdaq corporate governance rules[515]. Executive Compensation - The aggregate compensation for Cellebrite's executive officers and directors for the year ended December 31, 2024, was approximately $16.6 million, including $0.5 million for pension and similar benefits[375]. - Compensation expenses for the five highest-paid executives in 2024 included $150,000 for Thomas E. Hogan, $499,000 for former CEO Yossi Carmil, and $1,445,000 in equity-based compensation for Yossi Carmil[376]. - Non-employee directors receive an annual retainer of $60,000, with expert external directors receiving $75,000[379]. - The executive chairman's fixed annual service fee is $150,000, with a maximum annual bonus of $250,000 based on performance targets[381]. - An external director's compensation is determined prior to appointment and cannot be changed during their term, with certain exceptions[490]. Stock Options and Equity Plans - A total of 1,128,255 Options, PSUs, and RSUs were granted to executive officers and directors under equity incentive plans during 2024[375]. - As of December 31, 2024, there were options to purchase 1,806,335 Ordinary Shares outstanding under the 2008 Share Option Plan[388]. - As of December 31, 2024, there were options outstanding to purchase 4,313,566 Ordinary Shares under the 2019 Option Plan[403]. - The 2019 Option Plan allows for options to be granted under various tax regimes, including Section 102 of the Israeli Income Tax Ordinance[407]. - The 2019 Option Plan provides for a vesting schedule over a 4-year period, with one quarter vesting on the first anniversary and the remainder vesting quarterly thereafter[411]. - The 2021 Plan was adopted to incentivize employees and promote the success of the Company's business[437]. - The maximum number of shares initially available for issuance under the ESPP was 1,871,687 shares, equal to 1% of the outstanding shares immediately after the closing of the Merger[456]. - The maximum number of Ordinary Shares available for issuance under the 2021 Plan is equal to 18,716,872 shares, which is 10% of the outstanding shares immediately after the closing of the Merger[438]. Risk Factors - Inflationary factors may adversely affect the company's operating results, particularly if selling prices do not increase in line with rising costs[322]. Management Team - The Chief Financial Officer has been with the Company since May 2014, bringing extensive experience from previous roles in finance and management[355]. - The Chief Revenue Officer joined the Company in November 2023, previously serving as CRO at CSS LLC and Juniper Networks, with over 25 years of sales and management experience[359]. - The Chief Marketing Officer, who joined in March 2024, has over 25 years of technology sales and marketing leadership experience, previously serving in senior roles at Coherent Inc., Imperva, and HP[360]. - The Company’s Chairman of the Board has been in position since December 2024, previously serving as CEO of TWC Tech Holdings II, LLC, and has extensive experience in private equity and technology[363]. - The Company’s external director has been in position since November 2021, with a background in economics and previous roles including Deputy Governor of the Bank of Israel[364]. - The Company’s Lead Independent Director has been in position since January 2025, with a distinguished career including leadership roles at VCE, First Data Corporation, and MCI[365]. - The Chief Products & Technologies Officer has been with the Company since July 2020, previously serving as COO at Verbit.ai and holding key positions at HP Software[357]. - The Company has a diverse board of directors with extensive experience in technology, finance, and management, enhancing its strategic direction[363][364][365]. Shareholder Approval and Governance - The approval of at least 65% of the total voting power of shareholders is required to remove any directors, excluding external directors[478]. - The audit committee must consist of a majority of unaffiliated directors, ensuring compliance with the Companies Law[501]. - The compensation committee must be comprised of at least three directors, including all external directors, who must constitute a majority of the committee[509]. - Each member of the compensation committee must be independent under Nasdaq rules and the Exchange Act[510]. - The audit committee oversees the independent registered public accounting firm and recommends engagement, compensation, or termination[506]. - The compensation committee is responsible for approving the compensation policy for office holders and reviewing its implementation[512]. - The total number of shares voting against the compensation policy from non-controlling shareholders must not exceed 2%[516].