Typically, except with respect to his own compensation, our CEO will make recommendations to
our compensation committee regarding compensation matters, including the compensation of our executive officers. Our CEO also participates in meetings of our compensation committee, except with respect to discussions involving his own compensation
in which case he leaves the meeting.
While our compensation committee solicits the recommendations and proposals of our CEO with respect
to compensation-related matters, these recommendations and proposals are only one factor in our compensation committees decision-making process.
Role of Compensation Consultant
Our compensation committee has the authority to retain the services of external advisors, including compensation consultants, legal counsel and
other advisors, from time to time, as it sees fit, in connection with carrying out its duties.
In fiscal 2017, our compensation committee
continued to engage Compensia, Inc. (Compensia), a national compensation consulting firm, to assist us in executing our executive compensation strategy and guiding principles, assessing the current target total direct compensation
opportunities of our executive officers, including comparing them against competitive market practices, developing a compensation peer group and advising on potential executive compensation decisions for fiscal 2017.
Compensia does not provide any services to us other than the services provided to our compensation committee. Our compensation committee has
assessed the independence of Compensia taking into account, among other things, the factors set forth in Exchange Act Rule
10C-1
and the listing standards of the NYSE, and has concluded that no conflict of
interest exists with respect to the work that Compensia performs for our compensation committee.
Use of Competitive Data
To assess the competitiveness of our executive compensation program and to assist in setting compensation levels, we refer to
industry surveys, including the Radford High-Technology Executive Compensation Survey. In addition, during fiscal 2017, Compensia conducted an analysis of market data on the compensation peer group as approved by our compensation committee.
Competitive Positioning
In fiscal 2017, our compensation committee continued to compare and analyze our executive compensation with that of a formal compensation peer
group of companies.
In the context of our annual executive compensation review, with assistance from Compensia and input from management,
our compensation committee approved a peer group of publicly-traded technology companies, which met some or all of the following criteria: (i) operated in a high-technology industry, (ii) annual revenue approximately between
$1 billion and $3 billion; (iii) revenue growth greater than 20%; (iv) a market capitalization between approximately $7 billion and $25.0 billion; and (v) a market capitalization as a multiple of annual revenue that was
greater than six. As a result of the application of these criteria, we removed the following companies from our 2016 compensation peer group: Aruba Networks, which was acquired, Informatica Corporation, which was taken private, and each of Ubiquitiy
Networks, Inc., Qlik Technologies, Inc., Aspen Technology, Inc. and SolarWinds, Inc. because they no longer met our revenue and/or market capitalization requirements and were not sufficiently relevant comparables. In addition, we added Akamai
Technologies, Inc., Autodesk, Inc., Checkpoint Software, Inc. LinkedIn, Inc., Red Hat, Inc., Paychex, Inc., and VeriSign, Inc., which satisfied the above described criteria. The remainder of the peer group is unchanged.
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