GLOSSARY // Fundamentals
Proxy Statement
A proxy statement (SEC form DEF 14A) is the document companies send shareholders before the annual meeting, laying out board nominees, executive pay, auditor ratification, and any shareholder proposals up for a vote. It exists so shareholders who will not attend the meeting can vote by proxy.
It is also the only place executive compensation gets fully itemized: salary, bonus, stock and option awards, perks, and the golden-parachute math for a change of control. Pay structure tells you what management is actually incentivized to do, which is frequently not what the investor presentation says.
A proxy shows the CEO's total 2025 compensation at $21.4M against company net income of $410M, with 78% of the package in stock awards that vest on revenue targets rather than per-share returns. The same proxy shows annual equity grants running 1.8% of shares outstanding. A shareholder reading it learns that management is paid to grow the top line, dilution be damned.
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Educational only — not financial advice. Definitions simplified for clarity; markets are messier than definitions.