DEF 14A 1 mini-def14a_20180420.htm DEF 14A mini-def14a_20180420.htm

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934

Filed by the Registrant

Filed by a Party other than the Registrant

Check the appropriate box:

Preliminary Proxy Statement

Confidential, for Use of the Commission Only (as permitted by Rule14a-6(e)(2))

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material Pursuant to Rule §240.14a-12

MOBILE MINI, INC.

 

(Name of Registrant as Specified In Its Charter)

 

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

No fee required.

Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

 

(1)

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(3)

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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

 

(1)

Amount Previously Paid:

 

(2)

Form, Schedule or Registration Statement No.:

 

(3)

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(4)

Date Filed:

 

 

 


 

4646 E. Van Buren Street

Suite 400

Phoenix, Arizona 85008

 

Dear Fellow Stockholder:

You are cordially invited to attend the 2018 Annual Meeting of Stockholders of Mobile Mini, Inc. on Friday, April 20, 2018 at 11:00 a.m., local time. The meeting will be held at Mobile Mini’s headquarters, in Phoenix, Arizona.

This year, we are pleased to be again using the U.S. Securities and Exchange Commission rule that allows companies to furnish proxy materials over the Internet. We believe that this delivery process expedites stockholders’ receipt of proxy materials, while conserving natural resources and reducing the costs of printing and distributing our proxy materials. On or about March 9, 2018, we mailed to our stockholders a Notice of Internet Availability of Proxy Materials (the “Notice”) containing instructions on how to access our 2018 Proxy Statement and Annual Report to Stockholders for the fiscal year ended December 31, 2017. The Notice also provides instructions on how to vote online or over the telephone and includes instructions on how to receive, free of charge, a paper copy of the proxy materials by mail. If you receive your proxy materials by mail, a proxy card will be enclosed. If you receive your proxy materials via e-mail, the e-mail will contain voting instructions and links to the proxy materials which are available at www.proxyvote.com.

Details of the business expected to come before the annual meeting are provided in the Notice of Annual Meeting of Stockholders and Proxy Statement. Your vote is important. Whether or not you intend to be present at the meeting, it is important that your shares be represented. In addition to voting in person, stockholders of record may vote via a toll-free telephone number or over the Internet. Stockholders who received a paper copy of the proxy materials by mail may also vote by completing, signing and mailing the enclosed proxy card promptly in the return envelope provided. If you hold your shares through an account with a brokerage firm, bank or other nominee, please follow the instructions you receive from your brokerage firm, bank or other nominee to vote your shares.

On behalf of the Board of Directors, I would like to express our appreciation for your continued interest in Mobile Mini.

 

Sincerely,

 

Erik Olsson

President and Chief Executive Officer

 

 


 

NOTICE OF 2018 ANNUAL MEETING OF STOCKHOLDERS

 

DATE

Friday, April 20, 2018

 

TIME

11:00 a.m., local time

 

PLACE

Mobile Mini Headquarters

4646 E. Van Buren Street

Phoenix, Arizona 85008

 

ITEMS OF

BUSINESS

•  To elect nine members of the Board of Directors to hold office, each for a term of one year;

•  To ratify the appointment of KPMG LLP as our independent registered public accounting firm for the year ending December 31, 2018;

•  To vote on an advisory (non-binding) resolution to approve the compensation of our Named Executive Officers (as defined in the Proxy Statement); and

•  To transact any other business that may properly come before the meeting and to approve any postponement or adjournment thereof.

Any action on the items of business described above may be considered at the annual meeting at the time and on the date specified above or at any time and date to which the annual meeting may be properly adjourned or postponed.

 

RECORD

DATE

You are entitled to notice of, and to vote at, the meeting and any adjournments or postponements thereof if you were a stockholder of record at the close of business on February 20, 2018 (“Record Date”).

 

MATERIALS

TO REVIEW

We are furnishing our proxy materials, including our 2018 Proxy Statement (“Proxy Statement”), form of proxy card and Annual Report to stockholders for the fiscal year ended December 31, 2017 (“2017 Annual Report”), to our stockholders via the Internet in lieu of mailing a printed copy of our proxy materials to each stockholder of record. You will not receive a printed copy of our proxy materials unless you request one. This Notice of 2018 Annual Meeting of Stockholders (“Notice of Annual Meeting”) and the accompanying Notice of Internet Availability of Proxy Materials contain instructions on how to access our proxy materials. The Notice of Internet Availability of Proxy Materials also provides instructions on how to vote and how to receive a paper copy of the proxy materials, including a proxy card, by mail.

 

PROXY

VOTING

It is important that your shares be represented and voted at the annual meeting of stockholders to be held on Friday, April 20, 2018 (“Annual Meeting”). In addition to voting in person, stockholders of record may vote via a toll-free telephone number or over the Internet. Stockholders who received a paper copy of the proxy materials by mail may also vote by completing, signing and mailing the enclosed proxy card promptly in the return envelope provided. See details under “Proxy Statement — Questions and Answers About the Annual Meeting and Voting — How do I vote if I am the stockholder of record?” in the Proxy Statement.

 

By order of the Board of Directors,

 

Christopher J. Miner, Corporate Secretary

Phoenix, Arizona

March 9, 2018

 

 

 

 

 

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Stockholders to be Held on Friday, April 20, 2018: a complete set of proxy materials relating to the Annual Meeting is available via the Internet at www.proxyvote.com.

 

 

 

 


 

TABLE OF CONTENTS

 

 

Page

Proxy Statement Summary

 

1

Questions and Answers About the Annual Meeting and Voting

 

6

Governance of the Company

 

12

Beneficial Ownership Table

 

23

Section 16(A) Beneficial Ownership Reporting Compliance

 

25

Transactions With Related Persons

 

25

Proposals Requiring Your Vote

 

27

Proposal 1 — Election of Directors

 

27

Proposal 2 — Ratification of Selection of Independent Registered Public Accounting Firm

 

31

Audit Committee Report

 

33

Proposal 3 — Advisory (Non-Binding) Resolution Regarding Executive Compensation

 

34

Executive Compensation

 

36

Compensation Tables

 

51

Compensation Committee Interlocks and Insider Participation

 

56

Compensation Committee Report

 

57

Requirements, Including Deadlines, for Submission of Stockholder Proposals and Nominees

 

57

Annual Report

 

58

Other Business

 

58

 

 

 

i


 

4646 E. Van Buren Street

Suite 400

Phoenix, Arizona 85008

PROXY STATEMENT SUMMARY

This summary highlights information about Mobile Mini, Inc. and certain information contained elsewhere in our proxy materials for our 2018 Annual Meeting of stockholders. This summary does not contain all of the information that you should consider in voting your shares. You should read the entire Proxy Statement carefully before voting.

VOTING MATTERS AND BOARD RECOMMENDATIONS

 

Proposal

 

Board Vote

Recommendation

 

Proposal 1 – Election of Directors

 

FOR each nominee

 

Proposal 2 – Ratification of Selection of KPMG LLP

 

FOR

 

Proposal 3 – Advisory Vote to Approve Named Executive Officer Compensation

 

FOR

 

CASTING YOUR VOTE

 

  

 

How to Vote

 

Stockholder of Record
(Shares registered in your
name with our transfer

agent Wells Fargo)

 

Street Name Holders
(Shares held through a
Broker, Bank or Other
Nominee)

Internet

 

Visit the applicable voting website and follow the on-screen instructions:

 

www.proxyvote.com

 

Refer to voting instruction form.

Telephone

 

To vote call:

 

1-800-690-6903

 

Refer to voting instruction form.

Mail

 

If you requested paper copies of the proxy materials, sign, date and return your completed proxy card by mail.

In Person

 

For instructions on attending the 2018 Annual Meeting of Stockholders in person, please see “How do I vote if I am the stockholder of record? — In person at the Annual Meeting.”

1


 

BOARD NOMINEES

You are being asked to vote on the following nine nominees for director. All directors are elected annually by a majority of the votes cast. All nominees meet the NASDAQ listing rules for director independence, except for Mr. Olsson, who is not independent due to his position as an executive officer of Mobile Mini, Inc. Information about each director’s experiences, qualifications, attributes and skills can be found in “Proposal 1 – Election of Directors”.

 

Name

 

Age

 

Director

Since

 

Principal Occupation

 

Independent

 

Board
Committee
Membership*

Michael L. Watts

 

70

 

2002

 

President of Watts Investments LLC

 

Yes

 

GC

Erik Olsson

 

55

 

2013

 

President and Chief Executive Officer, Mobile Mini, Inc.

 

No

 

 

Sara R. Dial

 

53

 

2014

 

President and Chief Executive Officer of Sara Dial & Associates and Lead Director for Grand Canyon Education, Inc.

 

Yes

 

CC, GC

Jeffrey S. Goble

 

57

 

2006

 

Chief Executive Officer and Founder of Providien, LLC

 

Yes

 

CC, GC

James J. Martell

 

63

 

2010

 

Chairman of the board of directors and acting CEO of uShip.com, Chairman of the board of MyUS.com, Protrans International, Inc., P&S Transportation, Ameriflight.

 

Yes

 

AC,CC, GC

Stephen A McConnell

 

65

 

1998

 

President of Solano Ventures

 

Yes

 

AC, GC

Frederick G. McNamee, III

 

60

 

2008

 

Chief Executive Officer of Red Dot Corporation

 

Yes

 

AC, GC

Kimberly J. McWaters

 

53

 

2014

 

President and Chief Executive Officer of Universal Technical Institute, Inc.

 

Yes

 

AC, CC

Lawrence Trachtenberg

 

61

 

1995

 

Private Investor

 

Yes

 

AC, CC

* AC - Audit Committee      CC – Compensation Committee        GC – Governance & Nominating Committee

2


 

CORPORATE AND COMPENSATION GOVERNANCE HIGHLIGHTS

We believe our executive compensation program promotes good governance and operates in the best interests of our stockholders. We are committed to the highest standards of ethics, business integrity and corporate governance. Our governance practices are designed to establish and preserve management accountability, provide a structure that allows the Board of Directors (“Board”) to set objectives and monitor performance, ensure the efficient use and accountability of resources, and enhance stockholder value. A summary of our compensation and governance practices are listed below:

 

We do

 

We do not

  Place heavy emphasis on variable compensation, meaning cash and equity awards are dependent on the achievement of short-term and long-term financial goals

  Elect all Directors annually

 

×   Offer compensation-related tax gross-ups

  Use performance-related long-term compensation in the form of performance-based equity grants

  Elect Directors by majority vote

 

×   Have any significant perquisites

  Have stock ownership requirements for executives and Directors that reinforce alignment between stockholders and our NEOs (defined herein)

  Have an independent Chairman

 

×   Allow pledging, hedging, and trading in derivatives of Mobile Mini securities

  Have an executive compensation clawback policy to ensure accountability

  Split the roles of Chairman and Chief Executive Officer

 

×  Have special executive retirement programs

  Have an independent compensation consultant advising the Compensation Committee

  Perform annual Board and committee self-evaluations

 

×   Reprice or cash out underwater stock options

  Actively solicit feedback from our stockholders on compensation and governance matters

  Have a comprehensive Code of Business Conduct and Ethics and Corporate Governance Guidelines

 

×   Guarantee bonuses

  Have minimum vesting periods written into our Amended and Restated Equity Incentive Plan

  Grant the Board and each committee express authority to retain outside advisors

 

×   Have “single trigger” change of control provisions in executive employment agreements

STOCKHOLDER ENGAGEMENT

We value our stockholders’ perspective on our business and each year interact with stockholders through numerous stockholder engagement activities. In 2017, these activities included participation in investor conferences, meetings with individual stockholders throughout the year, as well as meeting with stockholders and answering questions at our 2017 annual meeting of stockholders (“2017 Annual Meeting”).  As a result of these efforts and pay practices, we received a 97% approval “Say on Pay” vote from stockholders at our 2017 Annual Meeting.

Prior to this proxy statement and beginning in December 2017, as part of this outreach, we contacted each of our top 30 stockholders, representing approximately 90% of our outstanding shares, for feedback relating to our corporate governance and executive compensation programs. Additionally, we offered meetings with senior management and the chairs of our Board Committees. Of the investors we contacted, holders representing approximately 21% of our outstanding shares participated in meetings with senior management.

These engagement activities, and the perspectives we gain, are helpful to us in our ongoing effort to increase stockholder value.

3


 

PROXY ACCESS

In January 2018, as part of our ongoing review of best practices in corporate governance, the Board voted to amend the Company’s bylaws to adopt so-called “proxy access” provisions. Under these provisions, stockholders (or a group of up to 20 stockholders), owning 3% or more of the Company’s outstanding shares of common stock continuously for at least three years may nominate and include in the Company’s proxy materials director nominees constituting up to 20% of the Board. We believe adopting this stockholder-friendly policy reflects Mobile Mini’s commitment to creating stockholder value through implementation of corporate governance best practices.

2017 BUSINESS HIGHLIGHTS

Our Annual Report, included with this Proxy Statement, contains financial information calculated in accordance with generally accepted accounting principles in the U.S. (“GAAP”), along with additional non-GAAP financial information, some of which is excerpted below. This information should be read together with our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, filed with the SEC on February 2, 2018 (the “2017 Form 10-K”) which includes additional information and related GAAP reconciliations.*

For the fiscal year ended December 31, 2017, our achievements include:

 

Grew total rental revenues 4.7% year-over-year, when adjusting for the unfavorable effect of currency fluctuations,

 

Within our Storage Solutions business, which represented approximately 82% of rental revenue in 2017:

 

-

Grew total rental revenues 6.0% year-over-year, when adjusting for unfavorable currency fluctuations,

 

-

Increased year-over-year Storage Solutions rental rates by 4.2%,  and

 

-

Increased average units on rent by 4.6%, and year-end units on rent by 6.0%,

 

Successfully positioned our Tank & Pump Solutions business to take advantage of positive trends in our underlying markets, resulting in:

 

-

Sequential rental revenue growth each quarter of 2017, and

 

-

Fourth quarter year-over-year rental revenue growth of 14.2%

 

Generated adjusted EBITDA of $184.8 million, with a 34.6% margin,

 

Achieved world-class safety results, with a North American Total Recordable Injury Rate of less than 1.0,

 

Implemented digital solutions across our businesses to drive market share, especially with large customers that value this deepened technology, and

 

Generated $65.6 million in free cash flow and returned $48.5 million to shareholders through dividends and treasury share repurchases.

 

*

For a discussion of our use of non-GAAP financial measures, including constant currency, and a reconciliation of (i) adjusted EBITDA to net income and net cash provided by operating activities and (ii) free cash flow to net cash provided by operating activities, please see the “Non-GAAP Data and Reconciliations” section beginning on page 28 in Item 6 of the 2017 Form 10-K.

Our consistent delivery of strong free cash flow has enabled us to create and return stockholder value. Our Board increased the Company’s first quarter 2018 cash dividend to 25.0 cents per share, a 10% increase compared to the preceding period. In addition to raising our quarterly dividend amount, we may opportunistically repurchase treasury shares from time to time in the open market or in privately negotiated transactions.  As of February 28, 2018, we have $70.8 million remaining authorized in our Board approved share repurchase program.

4


 

EXECUTIVE COMPENSATION OVERVIEW

Our executive compensation program aims to attract and retain high-caliber management talent to lead our business and reward them for outstanding performance.  This executive compensation overview and the accompanying compensation discussion and analysis (“CD&A”), is designed to provide an overview of our compensation actions and policies for our senior level executives. Our NEOs are defined on page 51 of the Proxy Statement.

Principal Elements of Pay: Our program emphasizes variable pay that aligns compensation with performance and stockholder value and has three key elements: base salary, annual short-term incentive compensation and long-term incentive compensation. Each of these elements serves a specific purpose in our compensation strategy.

 

Pay Element

 

How It’s Paid

 

Purpose

 

Base Salary

 

 

Cash

(Fixed)

 

 

Provide a competitive base salary rate relative to similar positions in the market and enable the Company to attract and retain highly skilled executive talent.

 

Annual Short-Term Incentive (“STI”)

 

 

Cash 

(Variable)

 

 

Focus executives on achieving Mobile Mini’s short-term financial goals measured over the current year.

 

Annual Long-Term Incentive (“LTI”)

 

 

Equity

(Variable)

 

 

Retain executives and provide incentive for them to reach financial goals and align their long-term economic interests with our stockholders.

Pay Mix: The mix of pay elements is heavily leveraged toward variable, performance-based compensation. For 2017, the significant majority of Named Executive Officer target pay was variable: 74% for the Chief Executive Officer (“CEO”); and an average of 65% for our other NEOs.  

Stockholder Support: At our 2017 Annual Meeting, we received substantial support for our executive compensation program, with approximately 97% of the stockholders who voted on the so called “Say-on-Pay” proposal approving the compensation of our NEOs. We interpreted this exceptionally strong level of support as affirmation of the structure of our program and our approach to making compensation decisions. As a result, we did not make substantive changes to the program design following the 2017 Annual Meeting.

Pay Decisions: The Compensation Committee took the following compensation-related actions for fiscal 2017:

 

Base salaries: The CEO did not receive a base salary increase. The other NEOs received increases ranging up to 5.5%.

 

Incentive compensation: Based on Company performance, annual bonuses were earned at 182.5% of target.  The second tranche of the performance-based options issued in 2016 did not vest, while the first tranche of the performance-based options issued in 2017 vested at 162.8%.  Performance conditions related to each of these tranches were based on 2017 results.

For specific details about our executive compensation program, please refer to the Compensation Discussion & Analysis (“CD&A”) section of the Proxy Statement.

 

 

5


 

PROXY STATEMENT

 

QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING AND VOTING

Why did I receive these proxy materials?

We are providing these proxy materials in connection with the solicitation by the Board of Directors (the “Board”) of Mobile Mini, Inc., a Delaware corporation (“Mobile Mini,” “we,” “us” or the “Company”), of proxies to be voted at our 2018 annual meeting of stockholders (the “Annual Meeting” or the “2018 Annual Meeting”) and at any adjournment or postponement thereof.

You are invited to attend the Annual Meeting, which will take place on April 20, 2018, beginning at 11:00 a.m., local time, at Mobile Mini’s headquarters, 4646 E. Van Buren Street, Phoenix, Arizona 85008.

The Notice of 2018 Annual Meeting of Stockholders (the “Notice of Annual Meeting”), this proxy statement (the “Proxy Statement” or “2018 Proxy Statement”) and form of proxy card or voting instruction card were first made available to stockholders starting on or about March 9, 2017.

Who is entitled to vote at the Annual Meeting?

Only stockholders of record at the close of business on February 20, 2018 (the “Record Date”), are entitled to receive the Notice of Annual Meeting and to vote their shares at the Annual Meeting. As of that date, there were 44,605,504 shares of the Company’s common stock outstanding. The common stock votes on the basis of one vote for each share held.

What is the difference between holding shares as a stockholder of record and as a beneficial owner?

If your shares are registered in your name with Mobile Mini’s transfer agent, Wells Fargo, you are the “stockholder of record” of those shares. The Notice of Annual Meeting, the Proxy Statement and any accompanying documents have been provided directly to you by Mobile Mini. These stockholders should refer to “How do I vote if I am the stockholder of record?” below for instructions regarding how to vote their shares.

If your shares are held in a stock brokerage account or by a bank or other holder of record, you are considered the “beneficial owner” of those shares, and the Notice of Annual Meeting, the Proxy Statement and any accompanying documents have been forwarded to you by your broker, bank or other holder of record. As the beneficial owner, you have the right to direct your broker, bank or other holder of record how to vote your shares by using the voting instruction card or by following their instructions for voting by telephone or via the Internet.

How do I vote if I am the stockholder of record?

If you are the stockholder of record, you may vote using any of the following methods:

By mail

Complete, sign and date the proxy card or voting instruction card and return it in the prepaid envelope. If you are a stockholder of record and you return your signed proxy card but do not indicate your voting preferences, the persons named in the proxy card will vote the shares represented by your proxy card as recommended by the Board.

If you are a stockholder of record and you do not have the prepaid envelope, please mail your completed proxy card to Vote Processing, c/o Broadridge Financial Solutions, 51 Mercedes Way, Edgewood, New York 11717.

By telephone or via the Internet

The telephone and Internet voting procedures established by Mobile Mini for stockholders of record are designed to authenticate your identity, allow you to give your voting instructions and confirm that those instructions have been properly recorded.

6


 

You can vote by calling the toll-free telephone number on your proxy card. Please have your proxy card available when you call. Easy-to-follow voice prompts will allow you to vote your shares and confirm that your instructions have been properly recorded. If you are located outside the U.S., Puerto Rico and Canada, see your proxy card for additional instructions.

The Web site for Internet voting is www.proxyvote.com. Please have your proxy card available when you go to the Web site. As with telephone voting, you can confirm that your instructions have been properly recorded. If you vote via the Internet, you also can request electronic delivery of future proxy materials.

Telephone and Internet voting facilities for stockholders of record will be available 24 hours a day until 11:59 p.m., Eastern Standard Time, on April 19, 2018.

The availability of telephone and Internet voting for beneficial owners will depend on the voting processes of your broker, bank or other holder of record. Therefore, we recommend that you follow the voting instructions in the materials you receive.

If you vote by telephone or via the Internet, you do not have to return your proxy card or voting instruction card.

In person at the Annual Meeting

Stockholders who attend the Annual Meeting may vote in person at the Annual Meeting. You may also be represented by another person at the Annual Meeting by executing a proper proxy designating that person. If you are a beneficial owner of shares, you must obtain a legal proxy from your broker, bank or other holder of record and present it to the inspectors of election with your ballot to be able to vote at the Annual Meeting.

Your vote is important. You can save us the expense and extra work of additional solicitation by voting promptly.

Whichever of these methods you select to transmit your instructions, the proxy holders will vote your shares in accordance with those instructions.  

If you vote by mail, telephone, or Internet without giving specific voting instructions, your shares will be voted as set forth in “How will my shares be voted at the Annual Meeting?”

What can I do if I change my mind after I vote?

Subject to any rules and deadlines your broker, bank or other holder of record may have, you may change your proxy instructions at any time before your proxy is voted at the Annual Meeting.  

If you are a stockholder of record, you can revoke your proxy before it is exercised by:

 

giving timely written notice to the Corporate Secretary of the Company of revocation;

 

delivering a valid, later-dated and duly executed proxy to the Corporate Secretary of the Company, or a later-dated vote by telephone or via the Internet, in a timely manner; or

 

voting by ballot at the Annual Meeting.

If you are a beneficial owner of shares, you may change your vote by (i) submitting new voting instructions by contacting your broker, bank or other holder of record or (ii) if you have obtained a legal proxy from the broker, bank or other holder of record giving you the right to vote the shares, by attending the Annual Meeting and voting in person.

All shares for which proxies have been properly submitted and not revoked will be voted at the Annual Meeting.

7


 

What shares are included on the proxy card?

If you are a stockholder of record, you will receive only one proxy card for all the shares you hold of record:

 

in certificate form; and

 

in book-entry form.

If you are a beneficial owner, you will receive voting instructions from your broker, bank or other holder of record.

What is “householding” and how does it affect me?

We have adopted a procedure, approved by the U.S. Securities and Exchange Commission (the “SEC”), called “householding.” Under this procedure, stockholders of record who have the same address and last name and do not participate in electronic delivery of proxy materials will receive only one copy of the Notice of Annual Meeting, the Proxy Statement and the Annual Report to stockholders for the fiscal year ended December 31, 2017 (the “2017 Annual Report”), unless we are notified that one or more of these stockholders wishes to continue receiving individual copies. This procedure will reduce our printing costs and postage fees.

Stockholders who participate in householding will continue to receive separate proxy cards.

If you are eligible for householding, but you and other stockholders of record with whom you share an address currently receive multiple copies of this Notice of Annual Meeting, the Proxy Statement and any accompanying documents, or if you hold Mobile Mini stock in more than one account, and in either case you wish to receive only a single copy of each of these documents for your household, please contact Broadridge Financial Solutions, Inc., Householding Department, 51 Mercedes Way, Edgewood, New York 11717 or call 1-800-542-1061.

If you participate in householding and wish to receive a separate copy of this Notice of Annual Meeting, the Proxy Statement and any accompanying documents, or if you do not wish to continue to participate in householding and prefer to receive separate copies of these documents in the future, please contact Broadridge Financial Solutions, Inc. as indicated above.

If you are a beneficial owner, you can request information about householding from your broker, bank or other holder of record.

How may I obtain a paper copy of the proxy materials?

Stockholders receiving a Notice of Internet Availability of Proxy Materials will find instructions in that notice about how to obtain a paper copy of the proxy materials.  Stockholders receiving Notice of Internet Availability of Proxy Materials by e-mail will find instructions in that e-mail about how to obtain a paper copy of the proxy materials.  Stockholders who have previously submitted a standing request to receive paper copies of our proxy materials will receive a paper copy of the proxy materials by mail.  

Is there a list of stockholders entitled to vote at the Annual Meeting?

The names of stockholders of record entitled to vote at the Annual Meeting will be available at the Annual Meeting and for ten days prior to the Annual Meeting for any purpose germane to the Annual Meeting, between the hours of 9:00 a.m. and 4:30 p.m., at our principal executive offices at 4646 E. Van Buren Street, Suite 400, Phoenix, Arizona, by contacting the Corporate Secretary of the Company.

What is a broker non-vote?

If you are a beneficial owner whose shares are held of record by a broker, you must instruct the broker how to vote your shares. If you do not provide voting instructions, your shares will not be voted on any proposal on which the broker does not have discretionary authority to vote. This is called a “broker non-vote.” In these cases, the broker can register your shares as being present at the Annual Meeting for purposes of determining the presence of a quorum, but will not be able to vote on those matters for which specific authorization is required under the rules governing banks and brokers who submit a proxy card with respect to shares held in street name.

8


 

If you are a beneficial owner whose shares are held of record by a broker, your broker has discretionary voting authority, under the rules governing banks and brokers who submit a proxy card with respect to shares held in street name, to vote your shares on the ratification of KPMG LLP as our independent registered public accounting firm, even if the broker does not receive voting instructions from you. However, your broker does not have discretionary authority to vote on the election of Director nominees or the advisory vote discussed later in this Proxy Statement without instructions from you, in which case a broker non-vote will occur and your shares will not be voted on these matters.

What is a quorum for the Annual Meeting?

The presence of the holders of stock representing a majority of the voting power of all shares of stock issued and outstanding as of the Record Date, represented in person or by proxy, is necessary to constitute a quorum for the transaction of business at the Annual Meeting. Your shares will be counted towards the quorum only if you submit a valid proxy (or one is submitted on your behalf by your broker, bank or other holder of record) or if you vote in person at the Annual Meeting. Abstentions and broker non-votes will each be counted as present for purposes of determining a quorum.

What are the voting requirements (including the effect of abstentions and non-broker votes) to elect the Director nominees and to approve each of the other proposals discussed in this Proxy Statement?

 

Proposal

 

Vote Required For Approval

 

 

 

 

Abstentions

 

Broker

Discretionary

Voting Allowed?

 

 

 

 

 

  1 -  Election of Directors

 

Majority of Votes Cast

  

No Effect

 

No

 

 

 

 

 

  2 -  Ratification of Selection of  KPMG LLP

 

Majority of Votes Present and Entitled to Vote

  

Same Effect as a Vote “Against”

 

Yes

 

 

 

 

 

  3 -  Advisory Vote to Approve Named Executive Officer Compensation

 

Majority of Votes Present and Entitled to Vote

  

Same Effect as a Vote “Against”

 

No

 

Election of Directors

The affirmative vote of the majority of votes cast at the Annual Meeting is required to elect each Director. This means that the number of votes cast “FOR” a Director nominee must exceed the number of votes cast “AGAINST” such nominee. Abstentions and, if applicable, broker non-votes will not affect the outcome of such vote, because abstentions and broker non-votes are not considered to be votes cast. Any Director nominee who does not receive a majority of votes cast “FOR” his or her election would be required to tender his or her resignation promptly following the failure to receive the required vote. The Nominating and Corporate Governance Committee (“Governance Committee”) would then be required to make a recommendation, within 90 days after the date of certification of the election results, to the Board as to whether the Board should accept the resignation, and the Board would be required to decide whether to accept the resignation and to disclose its decision-making process. In the event of a contested Director election, i.e., the number of Director nominees exceeds the number of Directors to be elected, the required vote would be a plurality of votes cast.

Ratification of Selection of KPMG LLP

The affirmative vote of a majority of the shares present or represented by proxy and entitled to vote on this proposal is required to approve the ratification of KPMG LLP as our independent registered public accounting firm. Abstentions will be counted as if voted “AGAINST” this proposal. Brokers have discretion to vote on the ratification of our independent registered public accounting firm and, as such, no votes on this proposal will be considered broker non-votes.

Advisory Vote to Approve Named Executive Officer Compensation

The affirmative vote of a majority of the shares present or represented by proxy and entitled to vote on this proposal is required to approve, on an advisory basis, the compensation of our Named Executive Officers (as defined herein). Abstentions will be counted as if voted “AGAINST” this proposal. Broker non-votes will have no effect on this proposal.

9


 

How will my shares be voted at the Annual Meeting?

At the Annual Meeting, the persons appointed by the Board (the persons named in the proxy card or, if applicable, their substitutes) will vote your shares as you instruct. If you sign your proxy card and return it without indicating how you would like to vote your shares, your shares will be voted as the Board recommends, which is set forth in below “How does the Board recommend that I vote?”  Additionally, if no specific instructions are given, the shares will be voted in accordance with the recommendation of the Board and as the proxy holders may determine in their discretion with respect to any other matters that properly come before the Annual Meeting.

How does the Board recommend that I vote?

The Board unanimously recommends that you vote your shares:

 

1.

FOR” the election of each of the Director nominees named in this Proxy Statement.

 

2.

FOR” the ratification of the selection of KPMG LLP as our independent registered public accounting firm for the 2018 fiscal year.

 

3.

FOR” the approval, on an advisory basis, of the compensation of our Named Executive Officers.

Could other matters be decided at the Annual Meeting?

On the date this Proxy Statement went to press, we did not know of any matters to be raised at the Annual Meeting other than those referred to in this Proxy Statement. For additional information see “Other Business” later in this Proxy Statement.

If you return your signed and completed proxy card or vote by telephone or via the Internet and other matters are properly presented at the Annual Meeting for consideration, the persons appointed as proxies by the Board will have the discretion to vote for you.

Can I access the Notice of Annual Meeting, the Proxy Statement and the 2017 Annual Report via the Internet?

The Notice of Annual Meeting, the Proxy Statement and the 2017 Annual Report are available via the Internet at www.proxyvote.com. Our proxy materials are also available on our Web site at www.mobilemini.com under the “Annual Reports” section of the “Investor Relations” page. Instead of receiving future proxy statements and accompanying materials by mail, most stockholders can elect to receive an e-mail that will provide electronic links to them. Opting to receive your proxy materials online will save us the cost of producing documents and mailing them to your home or business, and will also give you an electronic link to the proxy voting site. Your election to receive proxy materials electronically will remain in effect until you terminate it.

Stockholders of Record: If you vote via the Internet at www.proxyvote.com, simply follow the prompts for enrolling in the electronic proxy delivery service. You also may enroll in the electronic proxy delivery service at any time in the future by going directly to www.proxyvote.com and following the enrollment instructions.

Beneficial Owners: You also may be able to receive copies of these documents electronically. Please check the information provided in the proxy materials sent to you by your broker, bank or other holder of record regarding the availability of this service.

Who will pay for the cost of this proxy solicitation?

Mobile Mini will pay the cost of soliciting proxies. We will request banks, brokers and other intermediaries holding shares of our common stock beneficially owned by others to obtain proxies from the beneficial owners and will reimburse them for their reasonable costs. Proxies may be solicited on our behalf by Directors, officers or employees in person or by telephone, electronic transmission and/or facsimile transmission, without additional compensation.

10


 

Who will count the votes?

Our Corporate Secretary and Chief Accounting Officer will tabulate the votes and act as inspectors of election.

Is my vote confidential?

Proxy instructions, ballots, and voting tabulations that identify individual stockholders are handled in a manner that protects your voting privacy.  Your vote will not be disclosed either within Mobile Mini or to third parties, except: (i) as necessary to meet applicable legal requirements, (ii) to allow for the tabulation of votes and certification of the vote, and (iii) to facilitate a successful proxy solicitation.  Occasionally, stockholders provide on their proxy card written comments, which are then forwarded to Mobile Mini.

When will the voting results be announced?

We will announce preliminary voting results at the Annual Meeting. We will report final results in a Current Report on Form 8- K filed with the SEC.

11


 

GOVERNANCE OF THE COMPANY

OVERVIEW

The following sections of this Proxy Statement provide an overview of Mobile Mini’s corporate governance structure and processes, including independence and other criteria we use in selecting Director nominees, our Board leadership structure, and certain responsibilities and activities of the Board and its Committees, including a summary of our 2017 governance activities. We also discuss how our stockholders and other stakeholders can communicate with our Directors.

Mobile Mini’s Board is committed to maintaining strong corporate governance principles and practices. Our governance structure and processes are based upon a number of key governance documents, including our Corporate Governance Guidelines and policies described below. These Guidelines guide the Board and our executive management team in the execution of their responsibilities. Our Corporate Governance Guidelines are reviewed at least annually and are updated periodically in response to changing regulatory requirements, evolving practices, issues raised by our stockholders and other stakeholders and otherwise as circumstances warrant. As a result of this active engagement:

 

The Company has adopted “Proxy Access.”

 

8 of the 9 Directors are currently independent.

 

The roles of Chairman and CEO are split.

 

The Chairman is an independent Director.

 

The Company does not have a stockholder rights plan (a so-called “poison pill”).

 

The Company’s Bylaws require a majority voting standard for the election of Directors.

 

The Board is declassified.

 

The Board has stock ownership guidelines for Directors and officers.

 

The Audit, Compensation and Governance Committees are comprised solely of independent Directors.

 

The Board has adopted an enhanced whistleblower policy to encourage reporting by employees of any allegations of impropriety.

 

The Audit Committee restricts the hiring of current or former employees of our independent auditor.

 

The Board has an executive “clawback” policy to reclaim previously awarded compensation from executives who are found to have engaged in willful fraud or the intentional manipulation of performance measures.

 

Employment agreements for our named executive officers listed in the “2017 Summary Compensation Table” contained herein (the “Named Executive Officers” or “NEOs”) require “double trigger” provisions, whereby change in control benefits for NEOs would only be payable following a change in control if the executive was terminated without cause or for good reason.

 

The Board and each of its Committees have authority to retain outside advisors.

 

The Board regularly rotates the members serving as Committee Chairs.

 

The Compensation Committee’s outside advisor does not perform any other services for the Company and confirms its independence annually.

 

There are no interlocks among the Compensation Committee members.

 

The Board and each of its Committees perform annual self-assessments and a Board member peer review.

 

Each Director attended at least 75% of the combined Board meetings and Committee meetings of which they were a member.

 

Our Amended and Restated Equity Incentive Plan, as amended (the “Amended and Restated Equity Incentive Plan”), mandates a minimum vesting period of one year on at least 95% of the awards we grant under such plan and prohibits repricing of options and stock appreciation rights without stockholder approval, including paying cash upon cancellation of an underwater award as part of a repricing that would require stockholder approval.

12


 

The Board will continue to monitor corporate governance best practices and is committed to adopting policies that are in the best interests of the Company, its stockholders, employees and customers.

Our Corporate Governance Guidelines and the following additional materials relating to corporate governance at Mobile Mini are published on our Web site at: www.mobilemini.com under the “Corporate Governance” section of the “Investor Relations” page.

 

Board of Directors — Background and Experience

 

Senior Management — Background and Experience

 

Board Committees — Current Members

 

Corporate Governance Documents:

 

Code of Business Conduct and Ethics

 

Supplemental Code of Ethics for CEO and Senior Financial Officers

 

Executive Officer Clawback Policy

 

Corporate Governance Guidelines

 

Compensation Committee Charter

 

Governance Committee Charter

 

Audit Committee Charter

We will provide copies of any of the above items, without charge, upon written request to our Corporate Secretary at Mobile Mini, Inc., 4646 E. Van Buren Street, Suite 400, Phoenix, Arizona 85008. The information on our Web site is not a part of this Proxy Statement.

GOVERNANCE INFORMATION

Director Qualification Standards and Review of Director Nominees

The Governance Committee makes recommendations to the Board regarding the size and composition of the Board. The Committee is responsible for screening and reviewing potential Director candidates and recommending qualified candidates to the Board for nomination. The Governance Committee considers recommendations of potential candidates from current Directors, management and stockholders. Stockholders’ nominees for Directors must be made in writing and include the nominee’s written consent to the nomination and sufficient background information on the candidate to enable the Governance Committee to assess his or her qualifications. Nominations from stockholders must be addressed and must be received in accordance with the instructions set forth under “Requirements, Including Deadlines, For Submission of Stockholder Proposals and Nominees” later in this Proxy Statement in order to be included in the proxy statement relating to the next annual election of Directors.

Criteria for Board Membership

The Governance Committee is responsible for reviewing with the Board from time to time the appropriate skills and characteristics required of Board members in the context of the current size and make-up of the Board. This assessment includes issues of diversity and numerous other factors, such as work experience; understanding of and achievements in logistics, manufacturing, equipment leasing, technology, finance and sales and marketing; and other knowledge and experience relevant to Mobile Mini’s core businesses. These factors, and any other qualifications considered useful by the Governance Committee, are reviewed in the context of an assessment of the perceived needs of the Board when the Governance Committee recommends candidates to the Board for nomination. As a result, the priorities and emphasis that the Governance Committee, and the Board, places on various selection criteria may change from time to time to take into account changes in business and other trends, and the portfolio of skills and experience of current and prospective members. Therefore, while focused on the achievement and the ability of potential candidates to make a positive contribution with respect to such factors, the Governance Committee has not established any specific minimum criteria or qualifications that a nominee must possess. In addition, the Governance Committee, and the Board, are committed to considering candidates for the Board regardless of gender, ethnicity and national origin. We believe that the consideration and the flexibility of our nomination process has created Board diversity of a type that is effective for Mobile Mini.

13


 

Director Independence

With the assistance of legal counsel to the Company, the Board has determined that, other than Erik Olsson, who is our President and CEO, each of the members of the Board is currently an “independent director” for purposes of the NASDAQ Listing Rules and Rule 10A-3(b)(1) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as the term applies to membership on the Board and the various Committees of the Board. NASDAQ’s independence definition includes a series of objective tests, such as that the Director has not been an employee of the Company within the past three years and has not engaged in various types of business dealings with the Company. In addition, as further required by NASDAQ rules, our Board has made an affirmative subjective determination as to each independent director that no relationships exist which, in the opinion of the Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a Director. In making these determinations, the Board reviewed and discussed information provided by the Directors and us with regard to each Director’s business and personal activities as they may relate to Mobile Mini and Mobile Mini’s management. On an annual basis, each Director and executive officer is obligated to complete a Director and Officer Questionnaire that requires disclosure of any transactions with Mobile Mini in which the Director or officer, or any member of his or her family, have a direct or indirect material interest.

Based upon all of the elements of independence set forth in the NASDAQ rules and listing standards, the Board has determined that each of the non-employee Directors (Michael L. Watts, Sara R. Dial, Jeffrey S. Goble, James J. Martell, Stephen A McConnell, Frederick G. McNamee, III, Kimberly J. McWaters and Lawrence Trachtenberg) was independent in 2017 and has no relationship with Mobile Mini, except as a Director and stockholder of the Company.

In connection with the determination by the Board that Mr. Watts is independent, the Board considered the related party transactions with Mr. Watts disclosed in “Transactions with Related Persons” later in this Proxy Statement.

Board Leadership Structure

The Board recognizes that one of its key responsibilities is to evaluate and determine its optimal leadership structure so as to provide independent oversight of management. The Board understands that there is no single, generally accepted approach to providing Board leadership, and that given the dynamic and competitive environment in which we operate, the right Board leadership structure may vary as circumstances warrant. Our Corporate Governance Guidelines currently provide that the Board may select either a combined CEO and Chairman role, or appoint a Chairman who does not also serve as CEO. We currently separate the roles of CEO and Chairman of the Board in recognition of the differences between the two roles. The CEO is responsible for setting the strategic direction for the Company and the day-to-day leadership and performance of the Company, while the Chairman of the Board provides guidance to the CEO and sets the agenda for Board meetings and presides over meetings of the full Board. The Board believes this leadership structure is optimal for the Company at the current time.

A number of factors support the leadership structure chosen by the Board, including, among others: the Board believes this governance structure promotes balance between the Board’s independent authority to oversee our business and the CEO and his management team who manage the business on a day-to-day basis; the current separation of the Chairman and CEO roles allows the CEO to focus his time and energy on operating and managing Mobile Mini and leverage the experience and perspectives of the Chairman; the Chairman sets the agenda for, and presides over, Board meetings and independent sessions and coordinates the work of the Committees of our Board providing independent oversight and streamlining the CEO’s duties; and the Chairman serves as a liaison between the Board and senior management, but having an independent Chairman also enables non-management Directors to raise issues and concerns for Board consideration without immediately involving management.

The Board also believes that the current leadership structure provides independent oversight and management accountability through regular executive sessions of the independent Directors that are mandated by our Corporate Governance Guidelines and which are chaired by the Chairman of the Board, as well as through a Board composed of a majority of independent Directors.

14


 

In the event that our CEO is also the Chairman, our independent Directors would elect an independent Lead Director to be responsible for coordinating the activities of the other independent Directors and perform various other duties. The general authority and responsibilities of an independent Lead Director are established in our Corporate Governance Guidelines, which are posted on our Web site at www.mobilemini.com under the “Corporate Governance” section of the “Investor Relations” page.

Executive Sessions of Non-Employee Directors

Executive sessions of non-employee Directors are held before or during each regularly scheduled meeting of our Board and at other times as necessary and are led by our Chairman, Mr. Watts. At these executive sessions, the non-employee Directors review, among other things, the criteria upon which the performance of the CEO and other senior officers is evaluated, the performance of the CEO against such criteria, and the compensation of the CEO and other senior officers. These executive sessions also include meetings between members of the Audit Committee and the Company’s independent registered public accounting firm. Additional meetings are held from time to time with the CEO to discuss relevant subjects. The Board’s policy is to hold executive sessions without the presence of management, including the CEO.

The Board’s Role in Risk Oversight

Management is responsible for assessing and managing risk, subject to oversight by the Board. The Board executes its oversight responsibility for risk assessment and risk management directly and through its Committees, as follows:

 

The Audit Committee has primary responsibility for overseeing the Company’s enterprise risk management. The Company’s Chief Financial Officer, who works with the Audit Committee, facilitates this risk management in coordination with the Company’s General Counsel, as part of the Company’s strategic planning process. The Company’s Chief Financial Officer, General Counsel, Chief Information Officer, Chief Accounting Officer and Director of Risk Management together function as a Risk Committee and prepare an annual report to the Board on risks facing the Company, the probability and potential impact, as well as steps taken to mitigate risk. Additionally, the Chief Information Officer presents a quarterly review of cybersecurity risk and systems in place to mitigate this risk. The Audit Committee’s meeting agendas throughout the year include discussions of the Company’s policies with respect to risk assessment and risk management, as well as review of contingent liabilities and risks that may be material to the Company and major legislative and regulatory developments which could materially impact the Company’s contingent liabilities and risks. In addition, the Audit Committee has responsibilities with respect to our compliance program. For additional information, see “— Board and Committee Membership — The Audit Committee” and “Proposal 2 — Ratification of Selection of Independent Registered Public Accounting Firm — Audit Committee Report” later in this Proxy Statement.

 

The Board’s Committees oversee risks associated with their respective areas of responsibility. For example, the Compensation Committee considers the risks associated with our compensation policies and practices, with respect to both executive compensation and compensation generally. The Board is kept informed of its Committees’ risk oversight and other activities via reports of the Committee Chairmen to the full Board. These reports are presented at every regular Board meeting and include discussions of Committee agenda topics, including matters involving risk oversight.  In addition, all Board members are invited to all committee meetings as an additional method of keeping each Director aware of the various risks and activities across the Company.

 

The Board considers specific risk topics, including risks associated with our strategic plan and proposed strategic initiatives, our capital structure, our development activities, our technology systems, and our disaster recovery plans. In addition, the Board receives regular reports from the members of our executive management — the heads of our principal corporate functions — that include discussions of the risks and exposures involved in their respective areas of responsibility. These reports are provided in connection with and discussed at Board meetings. Further, the Board is routinely informed of developments that could affect our risk profile or other aspects of our business.

15


 

Risk Considerations in our Compensation Programs

The Compensation Committee conducts an annual risk assessment of our compensation policies and practices for employees, including those related to executive compensation programs. As part of the risk assessment, the Compensation Committee reviews our compensation programs for certain design features that have been identified by experts as having the potential to encourage excessive risk-taking, such as compensation mix overly weighted toward annual incentives and unreasonable goals or thresholds. The Compensation Committee has determined that, for all employees, our compensation programs encourage our employees to take appropriate risks and encourage behaviors that enhance sustainable value creation in furtherance of the Company’s business, but do not encourage excessive risk. The Compensation Committee believes that its balanced approach to short-term and long-term incentive compensation does not incentivize employees to take unnecessary risks. The Compensation Committee, with the assistance of independent advisors, intends to continue, on an on-going basis, a process of thoroughly reviewing our compensation policies and programs to ensure that our compensation programs and risk mitigation strategies continue to discourage imprudent risk-taking activities.

Communications with the Board of Directors

Stockholders may communicate with the Board by writing to us at Mobile Mini, Inc., 4646 E. Van Buren Street, Suite 400, Phoenix, AZ 85008, Attn: Corporate Secretary. Communications received in writing will be distributed to the Chairman of the Board or the Chairman of the appropriate committee of the Board, depending on the facts and circumstances contained in the communication received. The Corporate Secretary has been instructed not to forward items that are deemed to be of a frivolous nature, unrelated to the duties and responsibilities of the Board or otherwise inappropriate for the Board’s consideration. In certain instances, the Corporate Secretary may forward such correspondence elsewhere in the Company for review and possible action or response.

Indemnification of Directors and Officers

As required by our Bylaws, we indemnify our Directors and our officers to the fullest extent permitted by law so that they will be free from undue concern about personal liability in connection with their service to the Company. We also have entered into agreements with our Directors that contractually obligate us to provide this indemnification.

Mobile Mini’s Policies on Business Conduct and Ethics

All of our employees, including our CEO, Chief Financial Officer and Principal Accounting Officer, are required to abide by our Code of Business Conduct and Ethics to ensure that our business is conducted in a consistently legal and ethical manner. These policies form the foundation of a comprehensive process that includes compliance with corporate policies and procedures, an open relationship among colleagues that contributes to good business conduct, and a commitment to honesty, fair dealing and full compliance with all laws and regulations affecting Mobile Mini’s business. Our policies and procedures cover all major areas of professional conduct, including employment policies, conflicts of interest, intellectual property and the protection of confidential information, as well as strict adherence to laws and regulations applicable to the conduct of our business. Our Code of Business Conduct and Ethics policy was amended and restated in late December 2016 (to be effective January 1, 2017), in order to strengthen and enhance the ethical standards, requirements and expectations of Mobile Mini for all of its employees.

Employees are required to report any conduct that they believe in good faith to be an actual or apparent violation of our Code of Business Conduct and Ethics. As required by the Sarbanes-Oxley Act of 2002, our Audit Committee has procedures to receive, retain and treat complaints received regarding accounting, internal accounting controls or auditing matters and to allow for the confidential and anonymous submission by employees of concerns regarding questionable accounting or auditing matters.

The Company’s CEO, Chief Financial Officer, Principal Accounting Officer, Controller, if applicable, and Senior Accounting Officers (collectively, the “Senior Financial Officers”) are also required to abide by our Supplemental Code of Ethics for CEO and Senior Financial Officers (the “Supplemental Code of Ethics”). The Supplemental Code of Ethics sets forth specific policies to guide the Senior Financial Officers in the performance of their duties, including policies addressing compliance with laws, rules and regulations, conflicts of interest, and disclosures in the Company’s periodic reports and other public communications.

16


 

The full text of both the Code of Business Conduct and Ethics and the Supplemental Code of Ethics are posted on our Web site at www.mobilemini.com under the “Corporate Governance” section of the “Investor Relations” page. We will disclose any future amendments to, or waivers from, provisions of these ethics policies and standards on our Web site as promptly as practicable, as may be required under applicable SEC and NASDAQ rules and, to the extent required, by filing Current Reports on Form 8-K with the SEC disclosing such information.

CORPORATE GOVERNANCE REPORT

Good corporate governance is fundamental to our business and our success. We seek to ensure that good governance and responsible business principles and practices are part of our culture and values and the way we do business.

2017 in Review

Advisory Votes on Named Executive Officer Compensation.  At our 2017 Annual Meeting, approximately 97% of the Say-on-Pay votes cast by our stockholders were in favor of our executive compensation program. The Board believes this vote affirms our stockholders’ support of the Company’s approach to executive compensation. At the 2017 Annual Meeting, the Company gave the stockholders the opportunity not only to cast another Say-on-Pay vote on the compensation of our NEOs, but also to express a preference as to how often such advisory votes should be conducted in the future. The stockholders voted to hold advisory votes on the compensation of our NEOs every year.  The Board believes that the advisory vote is an additional means of obtaining feedback from our stockholders about executive compensation, and has determined to conduct the Say-on-Pay vote annually. The feedback received from the advisory votes will continue to supplement our ongoing investor outreach activities on a broad range of corporate governance topics, including executive compensation.

Our STI/LTI Plans. As a result of the substantial support for our executive compensation program, we did not make substantive changes to the program design following the 2017 Annual Meeting. Our equity grants made in early 2018 have the same structure as the equity grants made in early 2017. However, instead of granting performance-based options, the Compensation Committee has chosen to grant performance-based stock awards and has changed the service-based vesting period for restricted stock awards from four years to three.  The CEO’s STI (bonus) targets for 2018 performance are based on the achievement of specific rental revenue and EBITDA targets, similar to our 2017 STI (bonus) plan. For the NEOs other than the CEO, STI targets also include a component relating to achievement of individual goals.

Stockholder Outreach. We value our stockholders’ perspective on our business and each year interact with stockholders through numerous stockholder engagement activities. In 2017, these activities included participation in investor conferences, meetings with individual stockholders throughout the year, as well as meeting with stockholders and answering questions at our 2017 Annual Meeting. As part of this outreach, beginning in December 2017 we contacted each of our top 30 stockholders, representing approximately 90% of our outstanding shares, for feedback relating to our corporate governance and executive compensation programs. Additionally we offered meetings with senior management and the chairs of our Compensation and Governance Committees. Of the investors we contacted, holders representing approximately 21% of our outstanding shares participated in meetings with management.

Other Corporate Governance Activities

The Board and the Governance Committee were active in many other areas prior to the 2018 Annual Meeting, including:

 

adopting stockholder-friendly “Proxy Access” provisions;

 

monitoring and evaluating corporate governance developments and related legislative initiatives, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”) and new SEC rules and proposals and other key areas;

 

implementing the new requirements to provide pay ratio information;

 

reviewing and assessing the Company’s senior leadership and ensuring ongoing and succession planning is taking place;

 

assessing Director independence, Director compensation, related party transactions, and service by our senior management and Directors on other boards of directors; and

 

reviewing and, as discussed above, proposing changes to our governing documents, including our Code of Business Conduct and Ethics and Supplemental Code of Ethics.

17


 

BOARD AND COMMITTEE MEMBERSHIP

Meeting Attendance

During 2017, our Board met five times and we had three standing committees: the Audit Committee, the Compensation Committee, and the Governance Committee. Each member of the Audit, Compensation, and Governance Committees is an independent Director in accordance with NASDAQ standards. Each of our Directors attended at least 75% of the combined meetings of the Board and the Board Committees on which he or she served that were held during the time he or she was a Director in 2017. Additionally, the Audit Committee held several informal meetings throughout the year with Committee members and management to discuss various topics including cybersecurity. Board members are also invited to attend the Annual Meeting.  All of our Board members attended the 2017 Annual Meeting.

The table below depicts meeting information for 2017 and the Committee membership as of the date of this Proxy Statement:

 

Name

 

Audit

 

Compensation

 

Nominating and Corporate Governance

Olsson

 

 

 

 

 

 

 

 

 

 

 

 

 

Dial

 

 

 

X*

 

X

 

 

 

 

 

 

 

Goble

 

 

 

X

 

X

 

 

 

 

 

 

 

Martell

 

X

 

X

 

X*

 

 

 

 

 

 

 

McConnell

 

X

 

 

 

X

 

 

 

 

 

 

 

McNamee

 

X

 

 

 

X

 

 

 

 

 

 

 

McWaters

 

X

 

X

 

 

 

 

 

 

 

 

 

Trachtenberg

 

X*

 

X

 

 

 

 

 

 

 

 

 

Watts

 

 

 

 

 

X

 

 

 

 

 

 

 

Total Meetings during 2017

 

4

 

6

 

1

 

*

Committee Chairman

The Audit Committee

The Audit Committee, which met four times in 2017, is governed by a Board-approved Charter stating its responsibilities.  Under its Charter, the Audit Committee is responsible for reviewing with the independent registered public accounting firm, internal audit and management and the adequacy and effectiveness of internal controls over financial reporting. The Audit Committee also reviews and consults with management, internal audit and the independent registered public accounting firm on matters related to the annual audit, the published financial statements, earnings releases, and the accounting principles applied. The Audit Committee is directly responsible for the appointment, compensation, retention and oversight of the Company’s independent auditors and evaluates the independent auditors’ qualifications, performance and independence. The Audit Committee reviews reports from management relating to the status of compliance with laws, regulations and internal procedures.

In addition, the Audit Committee is responsible for reviewing and discussing with management the Company’s policies with respect to risk assessment and risk management. Further detail about the role of the Audit Committee in risk assessment and risk management may be found in “— Governance Information — The Board’s Role in Risk Oversight” earlier in this Proxy Statement.

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The Audit Committee has established policies and procedures for the pre-approval of all services provided by the independent auditors. The Audit Committee has also established procedures for the receipt, retention and treatment, on a confidential basis, of complaints received by the Company. Further detail about the role of the Audit Committee may be found in “Proposal 2 — Ratification of Selection of Independent Registered Public Accounting Firm — Audit Committee Report” later in this Proxy Statement.

The Board has determined that each of the members of the Audit Committee is financially literate and independent, as defined by the rules of the SEC and NASDAQ. Our Audit Committee must also include at least one independent member who is determined by the Board to meet the qualifications of an “audit committee financial expert” in accordance with SEC rules, including that the person meets the relevant definition of an “independent director.” Our Board has determined that Stephen A McConnell and Lawrence Trachtenberg are both audit committee financial experts. Stockholders should understand that this designation is a disclosure requirement of the SEC related to Mr. McConnell’s and Mr. Trachtenberg’s experience and understanding with respect to certain accounting and auditing matters. The designation does not impose upon Mr. McConnell or Mr. Trachtenberg any duties, obligations or liabilities that are greater than are generally imposed on them as members of the Audit Committee and the Board, and their designation as audit committee financial experts pursuant to this SEC requirement does not affect the duties, obligations or liabilities of any other member of the Audit Committee or the Board.

The Audit Committee is required by rules of the SEC to publish a report to stockholders concerning the Audit Committee’s activities during the prior fiscal year. See “— Audit Committee Report” contained within this Proxy Statement.

A copy of the Audit Committee Charter is available on our Web site at www.mobilemini.com under the “Corporate Governance” section of the “Investor Relations” page.

The Compensation Committee

The Compensation Committee, which met six times in 2017, is governed by a Board-approved Charter stating its responsibilities. The Compensation Committee determines and oversees the execution of the Company’s executive compensation philosophy and oversees the administration of the Company’s executive compensation programs. Its responsibilities also include overseeing Mobile Mini’s compensation and benefit plans and policies, administering our incentive programs, which include our STI and LTI plans for various executive officers (including reviewing and approving equity grants and cash bonuses) and reviewing and approving annually all compensation decisions for the Company’s executive officers, including the NEOs identified in the “2017 Summary Compensation Table” contained herein. See “Compensation Discussion and Analysis” later in this Proxy Statement for information concerning the Compensation Committee’s role, processes and activities in overseeing executive compensation.

The Board has determined that each of the members of the Compensation Committee is independent, as defined by the rules of the SEC and NASDAQ. In addition, each Compensation Committee member is a “non-employee director” as defined in Rule 16b-3 under the Exchange Act and is an “outside director” as defined in Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”).

The Compensation Committee has in the past, and may in the future, delegate authority to review and approve the compensation of certain of our employees to our CEO, or other senior executive officers. Even where the Compensation Committee has not delegated that authority, our senior executive officers evaluate employee performance, establish performance targets and objectives and provide recommendations to the Compensation Committee regarding compensation to be paid to certain of our employees.

The Compensation Committee’s Charter provides that the Compensation Committee shall have the authority, to the extent it deems necessary or appropriate, to retain and oversee a compensation consultant and such other advisors to assist in the evaluation of Director, CEO or senior executive compensation. The Charter further provides that the Compensation Committee has the sole authority to retain and terminate any such consulting firm and has the sole authority to approve any such consulting firm’s fees and other retention terms. The Company has provided appropriate funding to the Compensation Committee for the foregoing purpose.

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Compensation Committee Consultant

In early 2017, the Compensation Committee undertook a request for proposal (“RFP”) process to search for a new compensation consultant. Members of management and the Committee members participated in writing RFP documents, having initial conversations to solicit bids from potential consultants and evaluating the proposals. In July 2017, the Compensation Committee selected and engaged Mercer as its new independent consultant. While members of management participated in meetings with potential consultants, members of management did not participate in the Compensation Committee’s decision to retain Mercer.

Pursuant to the authority granted to it in its Charter, the Compensation Committee engaged Mercer to review the competitiveness of the Company’s compensation program for our non-employee Directors and our senior executive officers.  Mercer also advises the Compensation Committee regarding various other executive and Director compensation issues as requested. Please refer to the discussion of the “Our Executive Compensation Program Framework — Role of Compensation Consultant” in the “Compensation Discussion and Analysis” section of this Proxy Statement for further details.

Mercer reports directly to the Compensation Committee, and the Compensation Committee may replace Mercer or hire additional consultants at any time. Mercer attends meetings of the Compensation Committee, as requested, and communicates with the Compensation Committee Chairman between meetings; however, the Compensation Committee makes all decisions regarding the compensation of the Company’s executive officers.

Mercer provides various executive compensation services to the Compensation Committee with respect to the Company’s executive officers and other key employees. The services Mercer provides include advising the Compensation Committee on the principal aspects of the Company’s executive compensation program and evolving best practices, and providing market information and analysis regarding the competitiveness of the Company’s program design and the Company’s award values in relationship to its performance.

The Compensation Committee regularly reviews the services provided by its outside consultants and believes that Mercer is independent in providing executive compensation consulting services. The Compensation Committee conducted a review of its relationship with Mercer in 2017, and determined that Mercer’s work for the Compensation Committee did not raise any conflicts of interest, consistent with the guidance provided under the Dodd-Frank Act, the SEC and the New York Stock Exchange. In making this determination, the Compensation Committee noted that during 2017:

 

Mercer did not provide any services to the Company or its management other than service to the Compensation Committee, and its services were limited to executive and Board compensation consulting. Specifically, it did not provide, directly or indirectly through affiliates, any non-executive compensation services, including, but not limited to, pension consulting or human resource outsourcing;

 

Fees from the Company were less than 1% of Mercer’s total revenue;

 

Mercer maintains a Conflicts Policy with specific policies and procedures designed to ensure independence;

 

None of the Mercer consultants who worked on Company matters had any business or personal relationship with Compensation Committee members;

 

None of the Mercer consultants who worked on Company matters, or Mercer, as a whole, had any business or personal relationship with executive officers of the Company; and

 

None of the Mercer consultants who worked on Company matters directly own Company stock.

The Compensation Committee continues to monitor the independence of its compensation consultant on a periodic basis.

A copy of the Compensation Committee Charter is available on our Web site at www.mobilemini.com under the “Corporate Governance” section of the “Investor Relations” page.

20


 

The Nominating and Corporate Governance Committee

The Governance Committee, which met one time in 2017, is comprised solely of independent Directors and is governed by a Board-approved Charter stating its responsibilities. The Governance Committee is responsible for considering and periodically reporting to the Board on matters relating to the identification, selection and qualification of candidates nominated to the Board and its committees; reviewing and assessing the effectiveness of our Corporate Governance Guidelines on significant corporate governance issues and recommending to the Board proposed revisions to such guidelines; and performing such other functions as the Board may from time to time assign to it. The Governance Committee also reviews and makes recommendations to the Board regarding the size and the composition of the Board. In addition, the Governance Committee will review and consider properly submitted stockholder recommendations on candidates for membership on the Board as described below.

A copy of the Corporate Governance Committee Charter is available on our Web site at www.mobilemini.com under the “Corporate Governance” section of the “Investor Relations” page.

Compensation of Non-Employee Directors

We currently have eight non-employee Directors that qualify for compensation. The 2017 compensation program for non-employee Directors included the following features:

 

The annual retainer fee was $50,000 for Directors, or $85,000 for the Chairman of the Board.

 

There was no fee for attending a Board meeting.

 

The annual stock award was $90,000 for Directors, or $135,000 for the Chairman of the Board.

 

The annual retainer fee paid to the Chairman of each of the three standing committees was $15,000, and the annual retainer fees paid to non-Chairman Committee members was $6,000.

Employee Directors do not receive any additional compensation for service on our Board. The following table sets forth information regarding the compensation earned during fiscal year 2017 by each individual who served as a non-employee Director at any time during the fiscal year.

2017 Director Compensation

 

 

 

Fees Earned or Paid in Cash

 

 

 

 

 

 

 

 

 

Name

 

Annual

Retainer

 

 

Committee

Chair

 

 

Committee

Retainer

 

 

Total

 

 

Stock

Awards (1)(2)

 

 

Total

 

Michael L. Watts

 

$

85,000

 

 

$

 

 

$

6,000

 

 

$

91,000

 

 

$

134,974

 

 

$

225,974

 

Sara R. Dial

 

 

50,000

 

 

 

15,000

 

 

 

6,000

 

 

 

71,000

 

 

 

89,983

 

 

 

160,983

 

Jeffrey S. Goble

 

 

50,000

 

 

 

 

 

 

12,000

 

 

 

62,000

 

 

 

89,983

 

 

 

151,983

 

James J. Martell

 

 

50,000

 

 

 

 

 

 

12,000

 

 

 

62,000

 

 

 

89,983

 

 

 

151,983

 

Stephen A McConnell

 

 

50,000

 

 

 

2,500

 

 

 

11,000

 

 

 

63,500

 

 

 

89,983

 

 

 

153,483

 

Frederick G. McNamee, III

 

 

50,000

 

 

 

15,000

 

 

 

6,000

 

 

 

71,000

 

 

 

89,983

 

 

 

160,983

 

Kimberly J. McWaters

 

 

50,000

 

 

 

 

 

 

12,000

 

 

 

62,000

 

 

 

89,983

 

 

 

151,983

 

Lawrence Trachtenberg

 

 

50,000

 

 

 

12,500

 

 

 

6,000

 

 

 

68,500

 

 

 

89,983

 

 

 

158,483

 

 

(1)

Represents the grant-date fair value of the Directors’ equity awards in fiscal year 2017, as calculated in accordance with GAAP. These awards vest 100% when granted. The Company does not issue fractional shares for these awards nor does the Company compensate in cash for any fractional differences between the share-value and intended fair market value. The values included in this column have not been, and may never be realized. The value of the shares realized by the holder will depend on the share price on the date the shares awarded are sold. Assumptions used to value equity awards are disclosed in Note 9 to the consolidated financial statements contained in the 2017 Form 10-K.

(2)

As of December 31, 2017, no non-employee Director held unvested stock awards or stock option awards.

21


 

In February 2018, upon the recommendation of Mercer and the Compensation Committee, the Board approved an increase in annual Board member stock awards from $90,000 to $100,000 (from $135,000 to $145,000 for the Chairman) and an increase in the annual retainer from $50,000 to $55,000 (from $85,000 to $90,000 for the Chairman).  The total compensation for a typical non-Chair director is between the 25th and 50th percentile of Board compensation for our peers.

Non-Employee Director Stock Ownership Requirement

Each non-employee Director is required to own shares of our common stock having a value at least equal to five times the annual cash retainer paid to non-employee Directors. The measurement date to determine compliance with the stock ownership requirement is December 31st of each year. Any newly elected non-employee Director will have five years following his or her election to the Board to meet the stock ownership requirement. Until the amount contemplated by the guidelines is achieved, or if a Director becomes non-compliant due to a reduction in the price of the Company’s common stock, such Director is required to retain an amount equal to 50% of the shares received as a result of the exercise of options or the vesting and settlement of restricted stock, restricted stock units, performance shares, or other similar full value awards. As of the date of this Proxy Statement, all of our non-employee Directors were in compliance with this stock ownership requirement. We have also adopted stock ownership requirements for our executive officers as described herein.

22


 

BENEFICIAL OWNERSHIP TABLE

The table below sets forth information known to us regarding the number of shares of our common stock beneficially owned as of the close of business on February 20, 2018, by (i) each of our Directors, (ii) each NEO listed in the “2017 Summary Compensation Table”, (iii) all of our Directors and executive officers as a group, and (iv) each stockholder we know to be the beneficial owner of more than 5% of the outstanding shares of our common stock, as determined based on a review of filings with the SEC.

Beneficial ownership is determined in accordance with Rule 13d-3 under the Exchange Act and generally includes voting or investment power over securities. Under this rule, a person is deemed to be the beneficial owner of restricted stock awards, and securities that can be acquired by such person within 60 days of February 20, 2018 upon the exercise of options. Restricted stock as shown in the table below is forfeitable until vested. Each beneficial owner’s percentage ownership is determined by assuming that all options held by such person that are exercisable within 60 days of February 20, 2018 have been exercised.

Unless otherwise noted, the address of each person named in the table is 4646 E. Van Buren Street, Suite 400, Phoenix, Arizona 85008.

 

Name of Beneficial Owner (1)

 

Shares (2)

 

 

Restricted

Stock (3)

 

 

Shares

Acquirable

Within 60 Days

 

 

Total

 

 

Percent

of Class

Owned (4)

 

Directors and Executive Officers:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Michael L. Watts

 

 

76,183

 

 

 

 

 

 

 

 

 

76,183

 

 

*

 

Sara R. Dial

 

 

10,498

 

 

 

 

 

 

 

 

 

10,498

 

 

*

 

Jeffrey S. Goble

 

 

20,503

 

 

 

 

 

 

 

 

 

20,503

 

 

*

 

James J. Martell

 

 

39,959

 

 

 

 

 

 

 

 

 

39,959

 

 

*

 

Stephen A McConnell

 

 

102,485

 

 

 

 

 

 

 

 

 

102,485

 

 

*

 

Frederick G. McNamee, III

 

 

34,657

 

 

 

 

 

 

 

 

 

34,657

 

 

*

 

Kimberly J. McWaters

 

 

10,498

 

 

 

 

 

 

 

 

 

10,498

 

 

*

 

Lawrence Trachtenberg

 

 

38,181

 

 

 

 

 

 

 

 

 

38,181

 

 

*

 

Erik Olsson

 

 

79,251

 

 

 

66,709

 

 

 

2,216,648

 

 

 

2,362,608

 

 

 

5.0

%

Van Welch

 

 

 

 

 

18,420

 

 

 

8,896

 

 

 

27,316

 

 

*

 

Kelly Williams

 

 

16,202

 

 

 

24,508

 

 

 

74,111

 

 

 

114,821

 

 

*

 

Mark Krivoruchka

 

 

 

 

 

10,175

 

 

 

11,492

 

 

 

21,667

 

 

*

 

Christopher Miner

 

 

20,798

 

 

 

14,029

 

 

 

78,735

 

 

 

113,562

 

 

*

 

Chad Ainsworth

 

 

422

 

 

 

3,137

 

 

 

3,422

 

 

 

6,981

 

 

*

 

All Directors and executive officers as a

   group (14 persons)

 

 

449,637

 

 

 

136,978

 

 

 

2,393,304

 

 

 

2,979,919

 

 

 

6.3

%

5% Holders:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T. Rowe Price Associates, Inc.(5)

 

 

7,309,589

 

 

 

 

 

 

 

 

 

7,309,589

 

 

 

16.4

%

100 E. Pratt Street,

Baltimore, MD  21202

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BlackRock, Inc.(6)

 

 

5,575,819

 

 

 

 

 

 

 

 

 

5,575,819

 

 

 

12.5

%

55 East 52nd Street,

New York, NY  10055

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Vanguard Group(7)

 

 

4,287,421

 

 

 

 

 

 

 

 

 

4,287,421

 

 

 

9.6

%

100 Vanguard Blvd.,

Malvern, PA  19355

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dimensional Fund Advisors LP(8)

 

 

3,719,146

 

 

 

 

 

 

 

 

 

3,719,146

 

 

 

8.3

%

Building One, 6300 Bee Cave Road,

Austin TX  78746

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Prudential Financial, Inc.(9)

 

 

3,372,777

 

 

 

 

 

 

 

 

 

3,372,777

 

 

 

7.6

%

751 Broad Street,

Newark, NJ  07102

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

*

Less than 1%.

23


 

(1)

Except as otherwise indicated, the persons named in this table have sole voting and investment power with respect to all shares of common stock shown as beneficially owned by them, subject to community property laws where applicable and to the information contained in the footnotes of this table.

(2)

The number of shares shown in this column does not include restricted stock awards subject to vesting requirements, which are shown in the adjacent column. Shares reported include shares that are individually or jointly owned, as well as shares over which the individual has either sole or shared investment or voting authority except as noted. Shares owned by Mr. McNamee include 25,568 shares of common stock held in trust.

(3)

Restricted stock awards subject to service-based vesting requirements.  This column does not include restricted stock awards subject to performance-based vesting requirements.

(4)

Percent of class owned was calculated on the basis of 44,605,504 shares of common stock outstanding as of February 20, 2018, plus any additional shares of common stock that a stockholder has the right to acquire within 60 days after February 20, 2018.

(5)

Amount shown includes shares owned by T. Rowe Price Associates, Inc. (“TRP”) and T. Rowe Price New Horizons Fund, Inc. (“Fund”). TRP has sole voting power with respect to 1,322,269 shares and sole dispositive power with respect to 7,309,589 shares, and Fund has sole voting power with respect to 5,801,536 shares.

(6)

BlackRock Inc. has sole voting power with respect to 5,478,026 shares and sole dispositive power with respect to 5,575,819 shares.

(7)

The Vanguard Group has sole and shared voting power with respect to 48,812 shares and 6,307 shares, respectively, and sole and shared dispositive power with respect to 4,235,895 shares and 51,526 shares, respectively.

(8)

Dimensional Fund Advisors LP has sole voting power with respect to 3,639,423 shares and sole dispositive power with respect to 3,719,146 shares.

(9)

Prudential Financial, Inc. has sole and shared voting power with respect to 214,113 shares and 2,958,313 shares, respectively, and sole and shared dispositive power with respect to 214,113 shares and 3,158,664 shares, respectively. Of the shares beneficially owned by Prudential Financial, Inc., 3,300,023 shares are owned by its subsidiary, Jennison Associates LLC and 72,754 are held by its subsidiary, Quantitative Management Associates LLC.


24


 

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires our Directors, certain of our officers and persons who beneficially own more than 10% of our common stock to file initial reports of beneficial ownership and reports of changes in beneficial ownership of our common stock with the SEC. Such persons are required by SEC regulations to furnish us with copies of all Section 16(a) forms filed by such person. Based solely on our review of such forms furnished to us, and written representations from certain reporting persons, we believe that in 2017 our Directors and our officers who are subject to Section 16(a) met all applicable filing requirements except as noted below.

On December 12, 2017 there was one late Form 4 filing for Mr. Williams to report shares withheld on non-performance-based stock that vested on August 1, 2017.  The filing was delayed as a result of an oversight due to clerical error.   On February 27, 2017, Mr. Olsson had performance-based restricted stock awards cancelled due to unmet targets.  The cancelled restricted stock awards were inadvertently deemed non-reportable.  Correction to Mr. Olsson’s directly held securities were reflected and footnoted on his January 24, 2018 filing.

TRANSACTIONS WITH RELATED PERSONS

REVIEW AND APPROVAL OF TRANSACTIONS WITH RELATED PERSONS

The Board has a written policy and procedures for review and approval of transactions involving Mobile Mini and “related persons” (which includes our Directors and executive officers or their immediate family members, or stockholders and their immediate family members owning 5% or more of Mobile Mini’s common stock). The policy applies to any transaction in which Mobile Mini is a participant and any related person has a direct or indirect material interest, excluding de minimus transactions of a commercial or other nature between a related person and Mobile Mini, or compensation arrangements between Mobile Mini and an executive officer or Director, or transactions involving competitive bids or in which standing pre-approval has been given.

Pursuant to its written Charter, the Audit Committee must review and approve in advance all related person transactions. In determining whether to approve a related person transaction, the Audit Committee looks to whether the related person transaction is on terms and conditions no less favorable to Mobile Mini than may reasonably be expected in arm’s-length transactions with unrelated parties. The Audit Committee will also consider such other factors as it may determine in circumstances of a particular transaction.

The Audit Committee is responsible for reviewing the material facts of all related person transactions, subject to the exceptions described above. The Audit Committee will either approve or disapprove the entry into the related person transaction. If advance approval is not feasible, the transaction will be considered and, if the Audit Committee determines it to be appropriate, ratified at the Audit Committee’s next regularly scheduled meeting. In determining whether to approve or ratify a transaction with a related person, the Audit Committee will take into account, among other factors that it determines to be appropriate, whether the transaction is on terms no less favorable than terms generally available to an unaffiliated third party under the same or similar circumstances and the extent of the related person’s interest in the transaction. Information relating to Mobile Mini’s transactions with related persons is set forth immediately below.

TRANSACTIONS WITH RELATED PERSONS IN 2017

We have entered into indemnification agreements with our Directors and certain of our executive officers containing provisions that require us, among other things, to indemnify our Directors and certain of our executive officers against certain liabilities that may arise by reason of their status or service as Directors or executive officers and to advance their expenses incurred as a result of any proceeding against them as to which they could be indemnified.

25


 

With our acquisition of Gulf Tanks Holdings, Inc., the parent company of Houston, Texas-based Evergreen Tank Solutions (“ETS”), in December 2014 (the “ETS Acquisition”), the Company acquired its subsidiary, Water Movers, Inc., an Arizona corporation (“Water Movers”), which had previously entered into two real property lease agreements with an entity partly owned by Michael L. Watts, our Chairman of the Board. These lease agreements began in 2013, prior to the ETS Acquisition, and expire in 2023. Aggregate rental payments under these lease agreements are currently approximately $18,000 per month.

Mr. Watts is also a minority investor in a digital marketing and strategy company with which Mobile Mini conducts business.  During 2017, Mobile Mini made approximately $0.7 million in payments to this company.  There was no payable due at December 31, 2017.

Prior to becoming Senior Vice President – Chief Human Resources Officer on November 30, 2017, Mark Krivoruchka was president and owner of a management consultant company that provided human resources consulting and staffing services to Mobile Mini.  For the year ended December 31, 2017, Mobile Mini expensed approximately $1.0 million related to the services provided by such management consultant company, including reimbursement for expenses incurred.  As of December 31, 2017 Mobile Mini owed the consulting company $0.6 million.

Except for the agreements noted in the foregoing paragraphs and the compensation and other arrangements described in “Compensation of Non-Employee Directors” and “Executive Compensation” elsewhere in this Proxy Statement, there were no transactions during our fiscal year ended December 31, 2017, and there is not currently proposed any transaction or series of similar transactions to which we were or will be a party, in which the amount involved exceeded or will exceed $120,000 in which any Director, any executive officer, any holder of 5% or more of our common stock or any member of their immediate family had or will have a direct or indirect material interest.

26


 

PROPOSALS REQUIRING YOUR VOTE

PROPOSAL 1 — ELECTION OF DIRECTORS

(Item No. 1 on the Proxy Card)

The Board currently consists of nine members. The Board is fully declassified and the terms for each of the current Directors are scheduled to expire on the date of the Annual Meeting.

All of the nominees are current Directors and have consented to serve as Directors. The Board has no reason to believe any of the nominees will be unable to act as a Director. However, should a nominee become unable to serve or should a vacancy on the Board occur before the Annual Meeting, the Board may either reduce its size or designate a substitute nominee. If a substitute nominee is named, your shares will be voted for the election of the substitute nominee designated by the Board. In the vote on the election of the Director nominees, stockholders may vote “FOR” nominees or “AGAINST” nominees. Each Director nominee receiving a number of “FOR” votes that exceed the number of “AGAINST” votes will be elected as a Director. Abstentions and, if applicable, broker non-votes are not counted as votes “FOR” or “AGAINST” a Director nominee.

The persons appointed by the Board as proxies intend to vote for the election of each of these Director nominees, unless you indicate otherwise on the proxy or voting instruction card.

The following pages contain biographical and other information about the Director nominees. Following each nominee’s biographical information, we have provided information concerning the particular experience, qualifications, attributes and/or skills that led the Governance Committee and the Board to determine that each nominee should serve as a Director.

Our Board unanimously recommends a vote “FOR” the election of each of these nominees as Directors.

NOMINEES FOR DIRECTOR

Michael L. Watts has served as a Director since 2002 and as Chairman of the Board since December 2012. Mr. Watts is currently the President of Watts Investments LLC, a private investment firm. Mr. Watts founded Sunstate Equipment Co. in 1977, where he served as Executive Chairman until February 2017. Sunstate Equipment Co. is one of the largest independently owned construction equipment rental companies operating in the United States. Mr. Watts co-founded specialty equipment rental companies Underground Safety Equipment, LLC in 2011 and Water Movers Equipment Company, in 2002, which was sold in 2013 to ETS and which Mobile Mini subsequently acquired in the ETS Acquisition. Mr. Watts also founded specialty equipment rental company, Trench Safety Equipment Company, and served as its Chairman from 1987 until the company was sold in 1998. Mr. Watts adds an independent voice and deep equipment rental industry knowledge to our Board. Age 70.

Erik Olsson has served as the Company’s President and CEO and a member of the Board since his appointment in March 2013. Mr. Olsson served as President, CEO and a director of RSC Holdings, Inc. (“RSC”), a North American equipment rental provider, and certain of its subsidiaries from 2006 until that company was acquired in April 2012. Mr. Olsson joined RSC in 2001 as Chief Financial Officer and became Chief Operating Officer in 2005. Earlier, Mr. Olsson held a number of senior financial management positions in various global businesses of RSC's former parent company, Atlas Copco Group, in Sweden, Brazil and the United States, including his last assignment as Chief Financial Officer for Milwaukee Electric Tool Corporation in Milwaukee, WI from 1998 to 2000. He is a Director on the board of Ritchie Brothers Auctioneers Incorporated, the world’s largest industrial auctioneer, and Dometic Group AB, a global manufacturer of products for mobile living. Mr. Olsson also serves on the board of directors of St. Mary’s Foodbank Alliance, one of the world’s largest food banks with a mission to alleviate hunger through the gathering and distribution of food while encouraging self-sufficiency, collaboration, advocacy and education. Mr. Olsson holds a degree in Business Administration and Economics from the University of Gothenburg, Sweden. Mr. Olsson’s qualifications to sit on our Board include his experience in finance, accounting and internal control, general management, business development and strategic planning, and industry and customer knowledge as demonstrated by his financial and operating expertise, his more than 20 years of experience in the equipment manufacturing, sales and rental industry, including experience serving in various senior financial management positions, as well as his ability to provide the Company with a global business perspective. Age 55.

27


 

Sara R. Dial has served as a Director since August 2014. Ms. Dial is President and CEO of Sara Dial & Associates, a global economic development and government relations consulting firm and has previously served as a director of the Arizona Department of Commerce. Ms. Dial also currently serves as lead director of Grand Canyon Education, Inc. and a member of the Advisory Board of BBVA Compass Bank in Phoenix, Arizona. She is active in many local and national philanthropic boards including experience as Chairman of Valley Youth Theater and Chairman of Social Venture Partners Arizona, a charitable foundation using a venture capital approach to giving. Prior to her work in the public sector, Ms. Dial worked in the investment banking industry. She is a graduate of Stanford University with a B.A. degree in international relations. Ms. Dial’s breadth of dealings with both businesses and governmental agencies brings a unique perspective to our Board. Age 53.

Jeffrey S. Goble has served as a Director since February 2006. Mr. Goble is CEO and Founder of Providien, LLC, which supplies contract manufacturing services to the medical device and biotech industries. He is also CEO of Access Scientific, LLC, a manufacturer of specialty vascular access devices. From 2003 to 2010, Mr. Goble was President of Medegen, Inc., which developed and manufactured specialty infusion therapy medical devices and provided contract-manufacturing services for medical device and pharmaceutical original equipment manufacturers. From 2001 to 2003, Mr. Goble was Medegen’s Corporate Vice President of Strategic Business Development. Medegen was founded when Mr. Goble, along with other Medegen executives, executed a management-led buy-out of certain operations of The Tech Group Inc. (“The Tech Group”) in 2001. Before co-founding Medegen as an independent company, Mr. Goble was Vice President-General Manager of The Tech Group’s North American contract manufacturing division. Mr. Goble joined The Tech Group in 1996 as Vice President-General Manager and established its Customer/Engineering Center. Prior to 1996, Mr. Goble held various marketing and operational management positions in the general merchandise distribution industry. He holds a B.S. degree in Political Science from Arizona State University. Mr. Goble adds business, financial and organizational skills, manufacturing experience and entrepreneurial perspective to our Board. Age 57.

James J. Martell has served as a Director since January 2010. Mr. Martell retired as a Director of XPO, Inc., a public company engaged in the ground and air freight business, and has over 30 years of experience in the transportation and logistics sectors. Mr. Martell has acted, and continues to act, as a consultant to WCAS X, where he is a member of WCAS X’s Resources Group and previously served as a director of a WCAS privately-held portfolio company, Ozburn-Hessey Logistics. Mr. Martell also serves as Chairman of the board of directors of logistics services providers MyUS.com, Protrans International, Inc., P&S Transportation and Ameriflight. Mr. Martell is an owner and member of the board of directors for logistic services providers Transforce, Inc., Quality Distribution and Livingston International, as well as Chairman of the board of directors and acting CEO of uShip.com. Mr. Martell graduated from Michigan Technological University with a B.S. degree in Business Administration. Mr. Martell brings a strong independent voice and relevant logistics and transportation industry knowledge to our Board. Age 63.

Stephen A McConnell has served as a Director since August 1998. Since 1996, he has been President of Solano Ventures, a private capital investment company holding investments in a broad range of businesses, primarily in Arizona. From 1998 to 2004, Mr. McConnell served as majority stockholder and Chairman of the Board of G-L Industries, L.L.C., a Salt Lake City-based manufacturer of wood glu-lam beams used in the construction industry. From 1991 to 1997, he was Chairman of the board of directors of Mallco Lumber & Building Materials, Inc., a wholesale distributor of lumber and doors. From 1991 to 1995, he was President of Belt Perry Associates, Inc., a property tax consulting firm. He is also a director of a number of private companies. Mr. McConnell has a B.A. degree in Economics from Harvard College and a MBA from Harvard Business School. Our Board benefits from Mr. McConnell’s extensive experience serving as a director, knowledge of finance and accounting, and insight into manufacturing, construction and distribution businesses. Age 65.

28


 

Frederick G. McNamee, III has served as a Director since June 2008. He served as our Interim Co-CEO from December 23, 2012 until March 18, 2013. Mr. McNamee has been on the board of directors of Red Dot Corporation since November 2016 and CEO since January 2, 2017. He has been a Principal of Quadrus Consulting, a consulting practice primarily focused in the manufacturing operations and strategic planning domains, since 2000. From 1994 to 1998, he served as the Chairman, President and CEO of Continental Circuits Corporation, which manufactured complex, multi-layer circuit boards used in electronic equipment intended for the computer, communications, instrumentation and industrial controls industries. Following the acquisition of Continental Circuits by Hadco Corporation in 1998, he served as Hadco’s Interim Chief Technology Officer and Senior Vice President in charge of operations in Malaysia and Phoenix, Arizona. Mr. McNamee received his B.S. degree in Industrial Engineering from Purdue University. Mr. McNamee’s past and ongoing business experiences and education have provided our Board with insight into managing a public company, financial oversight and conducting manufacturing operations. Age 60.

Kimberly J. McWaters has served as a Director since August 2014. She is currently the President and CEO for Universal Technical Institute, Inc. (“UTI”), a publicly traded company and leading provider of postsecondary education for students seeking careers in areas such as automotive repair. Ms. McWaters has spent her entire career at UTI, and has served as CEO since 2003. Ms. McWaters also serves as a director of the Penske Automotive Group, Inc. (“PAG”) and has served on the boards of directors of the Boys and Girls Clubs of Metropolitan Phoenix and Fresh Start Women’s Foundation for more than a decade. She holds a B.S. degree in Business Administration from the University of Phoenix. Ms. McWaters’ qualifications to sit on our Board include her experience in general management, business development/strategic planning and sales and marketing, as well as her experience as a director of a public company. Age 53.

Lawrence Trachtenberg has served as a Director since 1995. He served as our Interim Co-CEO from December 23, 2012 until March 18, 2013. He previously served as the Company’s Executive Vice President, Chief Financial Officer, General Counsel, Secretary and Treasurer. He retired from the General Counsel and Secretary positions in June 2008 and the Chief Financial Officer and Treasurer positions in November 2008. He retired from being an Executive Vice President on December 31, 2008 and continued to serve the Company thereafter as a non-officer employee until February 28, 2012. Mr. Trachtenberg received his J.D. degree from Harvard Law School and his B.A. degree in Accounting/Economics from Queens College of the City University of New York. In addition to his experience in financial, legal and accounting matters, Mr. Trachtenberg brings to our Board meaningful institutional knowledge of our Company acquired throughout his long tenure of service. Age 61.

EXECUTIVE OFFICERS

In addition to Mr. Olsson, the following individuals are executive officers of the Company. There are no family relationships among any of our current Directors or executive officers.

Van Welch was appointed Executive Vice President and Chief Financial Officer in August 2017. He is responsible for all accounting, banking and related financial matters. With more than three decades experience, including top leadership positions at large engineering and construction companies serving oil & gas, power, government and major infrastructure industries worldwide, he brings expertise of industries that Mobile Mini serves. Most recently, Mr. Welch held the position of Executive Vice President at Willbros Inc. from May 2011 and Chief Financial Officer from August 2006. Prior to his position at Willbros Inc., Mr. Welch served in senior finance roles at KBR Group. Mr. Welch holds a BBA from Stephen F. Austin State University and is a Certified Public Accountant. Age 63.

Kelly Williams has served as Executive Vice President and Chief Operating Officer since June 2014. Mr. Williams is responsible for sales and operations in North America and has more than 20 years of experience in the equipment and car rental industries. He joined Mobile Mini in July 2013 and has previously served as Senior Vice President, Western Division and Regional Manager. Prior to joining Mobile Mini, from November 2012 to June 2013, Mr. Williams was a Vice President at airWorx Construction Equipment & Supply. From September 2005 through August 2012, Mr. Williams worked in the equipment rental industry at RSC Holdings, Inc., most recently as Region Vice President. Mr. Williams is on the Advisory Board for Playworks Arizona. Playworks is the leading national nonprofit leveraging the power of play before, during, and after school to transform children’s physical and emotional health. Mr. Williams earned his B.A. degree from Anderson University.  Age 47.

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Christopher J. Miner has been Senior Vice President and General Counsel of Mobile Mini since December 2008 after joining the Company in June 2008. Mr. Miner is responsible for the Company’s legal strategy including litigation, compliance, safety, real estate and corporate operations. He supports the Board of Directors in developing and maintaining best practices for corporate governance. Prior to joining Mobile Mini, Mr. Minor spent nearly 10 years in private practice representing corporate and financial institutions, beginning his career at international law firm Davis Polk. He also serves on the board of A New Leaf, a provider of emergency shelter and services to those suffering from domestic violence and homelessness, as well as the board of Desert Financial Credit Union. Mr. Miner received his B.A. degree and J.D. degree from Brigham Young University. Age 46.

Mark Krivoruchka has served as Senior Vice President – Chief Human Resources Officer since December 2017, moving from his previous role as president at MK Strategic Resources (“MKSR”), a human resources and management consultant company that he founded in 2013.  MKSR has serviced Mobile Mini Solutions since December 2016.  From 2010 until 2013, Mr. Krivoruchka served as Senior Vice President of Human Resources at RSC Holdings, Inc.  Mr. Krivoruchka brings over 30 years of senior level executive experience in a wide variety of roles including positions at GE, Pillsbury, Maytag, Cooper Tire, Pillsbury Foodservice, Hoover Floorcare and McGraw-Edison.  Mr. Krivoruchka currently serves on the Virginia Tech Pamplin School of Business Advisory Council and St. Vincent DePaul Endowment Advisory Council.  He holds a B.S. Degree in Business, and an MBA from Virginia Tech University. Age 63.

Chad Ainsworth has served as Vice President and Chief Accounting Officer since August 2016. Mr. Ainsworth previously served as Vice President, Finance and Controller of Origami Owl, LLC from May 2015 until August 2016 and Vice President and Controller from December 2013 until May 2015. From August 2005 until December 2013, Mr. Ainsworth held various positions with KPMG, LLP, most recently as an Audit Senior Manager. Mr. Ainsworth holds a B.S. degree in Business Administration—Accounting, and a Masters of Accounting degree from the University of Arizona and is a registered Certified Public Accountant. Age 34.

Mark E. Funk served as our Executive Vice President and Chief Financial Officer from November 2008 through July 31, 2017.

 

30


 

PROPOSAL 2 — RATIFICATION OF SELECTION OF INDEPENDENT

REGISTERED PUBLIC ACCOUNTING FIRM

(Item No. 2 on the Proxy Card)

The Audit Committee of our Board has selected KPMG LLP to serve as our independent registered public accounting firm to audit the consolidated financial statements of the Company for the fiscal year ending December 31, 2018. KPMG LLP has acted in such capacity since May 17, 2013. Although ratification is not required by our Bylaws or otherwise, the Board is submitting the selection of KPMG LLP to our stockholders for ratification because we value our stockholders’ views on the Company’s independent registered public accounting firm and as a matter of good corporate practice. The affirmative vote of a majority of the shares present or represented by proxy and entitled to vote on this proposal is required to approve the ratification of KPMG LLP as our independent registered public accounting firm. Abstentions will be counted as if voted “AGAINST” this proposal. Even if the selection is ratified, however, the Audit Committee may in its discretion select a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of the Company and of our stockholders.

In the event that our stockholders fail to ratify the selection, it will be considered a recommendation to the Board and the Audit Committee to consider other auditors for next year. However, because of the difficulty in making any substitution of auditors after the beginning of the current year, the appointment for 2018 will stand, unless the Audit Committee determines there is a reason to make a change.

Representatives of KPMG LLP will attend the Annual Meeting, have an opportunity to make a statement if they so desire, and will be available to respond to appropriate questions from stockholders.

The Audit Committee reviews and pre-approves both audit and all permissible non-audit services provided by our independent registered public accounting firm. Accordingly, all services and fees in 2017 provided by KPMG LLP were pre-approved by the Audit Committee.

Our Board unanimously recommends a vote “FOR” the ratification of KPMG LLP as our independent registered public accounting firm for 2018.

Audit and Non-Audit Fees

The following table shows the fees for professional services rendered by KPMG LLP for the audit of the Company’s annual financial statements for the years ended December 31, 2017 and 2016, as applicable, and fees billed for other services rendered by KPMG LLP, as applicable, during those periods.

 

Fee Category

 

2016 Fees

 

2017 Fees

 

Audit fees

 

$

1,064,500

 

$

1,057,008

 

Audit-related fees

 

 

 

 

 

Tax fees

 

 

242,126

 

 

162,508

 

All other fees

 

 

 

 

 

Total fees

 

$

1,306,626

 

$

1,219,516

 

Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm

Consistent with the requirements of the SEC and the PCAOB regarding auditor independence, the Audit Committee has established a pre-approval policy and procedures for audit, audit-related and tax services that can be performed by the independent auditors without specific authorization from the Audit Committee, subject to certain restrictions. The policy sets out the specific services pre-approved by the Audit Committee and the applicable limitations, while ensuring the independence of the independent auditors to audit the Company’s financial statements is not impaired. The pre-approval policy does not include a delegation to management of the Audit Committee responsibilities under the Exchange Act.

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Prior to engagement of the independent registered public accounting firm for the next year’s audit, management submits for Audit Committee approval a list of services and related fees expected to be rendered during that year within each of four categories of services:

(1)

Audit services include audit work performed on the financial statements and internal control over financial reporting, as well as work that generally only the independent registered public accounting firm can reasonably be expected to provide, including comfort letters, statutory audits, and discussions surrounding the proper application of financial accounting and/or reporting standards.

(2)

Audit-related services are for assurance and related services that are traditionally performed by the independent registered public accounting firm, including due diligence related to mergers and acquisitions, audits of employee benefit plans, and special procedures required to meet certain regulatory requirements.

(3)

Tax services include all services, except those services specifically related to the audit of the financial statements, performed by the independent registered public accounting firm’s tax personnel, including tax analysis; assistance with the coordination and execution of tax-related activities, primarily in the area of corporate development; support for other tax-related regulatory requirements; and tax compliance and reporting.

(4)

All other services are those services not captured in the audit, audit-related or tax categories. The Company generally does not request such services from the independent registered public accounting firm.

Prior to engagement, the Audit Committee pre-approves independent registered public accounting firm services and budgets the fees for each service category. The Audit Committee requires the independent registered public accounting firm and management to report actual fees versus the budget periodically throughout the year by service category. During the year, circumstances may arise when it may become necessary to engage the independent registered public accounting firm for additional services not contemplated in the original pre-approval categories. In those instances, the Audit Committee requires specific pre-approval before engaging the independent registered public accounting firm.

All Audit, Audit-Related, Tax and All Other fees described above were approved by the Audit Committee before services were rendered.

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AUDIT COMMITTEE REPORT

In connection with the financial statements for the fiscal year ended December 31, 2017, the Audit Committee has:

(1)

reviewed and discussed the audited financial statements with management,

(2)

discussed with KPMG LLP, the Company’s independent registered public accounting firm, the matters required to be discussed under the rules adopted by the Public Company Accounting Oversight Board (“PCAOB”), and

(3)

received the written disclosure and letter from KPMG LLP with respect to the matters required by PCAOB Rule 3526, “Communications with Audit Committees Concerning Independence,” and discussed the matters therein with KPMG LLP.

Based upon these reviews and discussions, the Audit Committee recommended to the Board that the Company’s audited financial statements be included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2017 filed with the SEC.

THE AUDIT COMMITTEE

Lawrence Trachtenberg (Chair)

James J. Martell

Stephen A McConnell

Frederick G. McNamee, III

Kimberly J. McWaters

The foregoing Audit Committee Report shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except to the extent that the Company specifically incorporates such information by reference in such filing and shall not otherwise be deemed “filed” under either the Securities Act or the Exchange Act or considered to be “soliciting material.”

33


 

PROPOSAL 3 — ADVISORY (NON-BINDING) RESOLUTION

REGARDING EXECUTIVE COMPENSATION

(SAY-ON-PAY)

(Item No. 3 on the Proxy Card)

Background

The Dodd-Frank Act requires that our stockholders have the opportunity to cast a non-binding, advisory vote on the compensation of our Named Executive Officers, as described in the “Compensation Discussion and Analysis” section (“CD&A”) elsewhere in this Proxy Statement, the tabular disclosure regarding such compensation, and the accompanying narrative disclosure as set forth in this Proxy Statement. Please refer to the CD&A section of this Proxy Statement for a detailed discussion about our executive compensation programs, including information about the fiscal year 2017 compensation of our NEOs.

The advisory vote on executive compensation is not a vote on our general compensation policies, the compensation of our Board or our compensation policies as they relate to risk management.

The CD&A of this Proxy Statement provides a more detailed discussion of our executive compensation program and compensation philosophy. As noted in the CD&A, the Compensation Committee believes that our executive compensation program implements and achieves the goals of our executive compensation philosophy. That philosophy, which is set by the Compensation Committee, is to align the interests of the Company’s executives with those of its stockholders by rewarding performance at or above established goals that may be expected to enhance stockholder value, and to provide the compensation and incentives needed to attract, motivate and retain superior people in key positions and ensure that compensation provided to key employees is competitive relative to the compensation paid to similarly situated executives in peer companies generally.

Please refer to the CD&A of this Proxy Statement and accompanying tables and, in particular, the “Our Executive Compensation Program Framework” section contained therein for details regarding how our compensation program for executive management is structured to support and reward our annual and long-term financial performance as an organization.

Further details concerning the elements of our executive compensation program, how we implement our philosophy and goals, and how we apply the above principles to our compensation program are provided in the CD&A. In particular, we discuss how we set compensation targets and other objectives and evaluate performance against those targets and objectives to assure that performance is appropriately rewarded. In addition, the CD&A includes a discussion of the results of the prior year Say-on-Pay vote and the Compensation Committee’s response to the results.

The vote solicited by this Proposal 3 is advisory, and, therefore, is not binding on the Company, our Board or our Compensation Committee, nor will its outcome require the Company, our Board or our Compensation Committee to take any action. Moreover, the outcome of the vote will not be construed as overruling any decision by the Company or the Board.

Furthermore, because this non-binding, advisory resolution primarily relates to the compensation of our NEOs that has already been paid or contractually committed, there is generally no opportunity for us to revisit these decisions. However, our Board, including our Compensation Committee, values the opinions of our stockholders and, to the extent there is any significant vote against the executive officer compensation as disclosed in this Proxy Statement, we will consider our stockholders’ concerns and evaluate what actions, if any, may be appropriate to address those concerns.

Stockholders will be asked at the Annual Meeting to approve the following resolution pursuant to this Proposal 3:

“RESOLVED, that the stockholders of Mobile Mini, Inc. approve, on an advisory basis, the compensation of the Company’s Named Executive Officers, as disclosed pursuant to Item 402 of SEC Regulation S-K, including the Compensation Discussion and Analysis, the compensation tables and narrative disclosures in the Company’s definitive Proxy Statement for the Annual Meeting of Stockholders.”

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Vote Required and Board Recommendation

The affirmative vote of a majority of the shares present or represented by proxy and entitled to vote on this proposal is required to approve, on an advisory basis, the compensation of our Named Executive Officers. Abstentions will be counted as if voted “AGAINST” this proposal. Broker non-votes will have no effect on this proposal.

Our Board unanimously recommends a vote “FOR” the approval, on an advisory basis, of the compensation of the Company’s Named Executive Officers, as stated in the foregoing resolution.

 

35


 

EXECUTIVE COMPENSATION

COMPENSATION DISCUSSION AND ANALYSIS

This CD&A describes Mobile Mini’s executive compensation program for fiscal year 2017. We use our compensation program to attract, motivate and retain the colleagues who lead our business. In particular, this CD&A explains how the Compensation Committee (for purposes of this CD&A, the “Committee”) of the Board made 2017 compensation decisions for the following Named Executive Officers (“NEOs”):

 

 

 

 

NEO

 

Title

Erik Olsson

 

President & CEO

Van Welch (1)

 

Executive Vice President & Chief Financial Officer

Mark Funk (2)

 

Former Executive Vice President & Chief Financial  Officer

Kelly Williams

 

Executive Vice President & Chief Operating Officer

Mark Krivoruchka (3)

 

Senior Vice President, Human Resources

Christopher J. Miner

 

Senior Vice President & General Counsel

Chad Ainsworth

 

Vice President & Chief Accounting Officer

(1)

Mr. Welch became the Company’s Executive Vice President & Chief Financial Officer on August 31, 2017.

(2)

Mr. Funk left the Company in July 2017 and ceased to be an executive officer.

(3)

Mr. Krivoruchka was appointed Senior Vice President, Human Resources on November 30, 2017, moving from his previous role as an outside consultant to the Company.  We have voluntarily included Mr. Krivoruchka as an NEO for 2017 based on his current position in the Company.


36


 

EXECUTIVE SUMMARY

We believe our executive compensation program promotes good governance and operates in the best interests of our stockholders. We are committed to the highest standards of ethics, business integrity and corporate governance. Our governance practices are designed to establish and preserve management accountability, provide a structure that allows the Board to set objectives and monitor performance, ensure the efficient use and accountability of resources, and enhance stockholder value. A summary of our compensation and governance practices are listed below:

 

We do

 

We do not

   Place heavy emphasis on variable compensation, meaning cash and equity awards are dependent on the achievement of short-term and long-term financial goals

   Elect all Directors annually

 

×   Offer compensation-related tax gross-ups

   Use performance-related long-term compensation in the form of performance-based equity grants

   Elect Directors by majority vote

 

×   Have any significant perquisites

   Have stock ownership requirements for executives and Directors that reinforce alignment between stockholders and our NEOs

   Have an independent Chairman

 

×   Allow pledging, hedging, and trading in derivatives of Mobile Mini securities

   Have an executive compensation clawback policy to ensure accountability

   Split the roles of Chairman and Chief Executive Officer

 

×   Have special executive retirement programs

   Have an independent compensation consultant advising the Compensation Committee

   Perform annual Board and committee self-evaluations

 

×   Reprice or cash out underwater stock options

   Actively solicit feedback from our stockholders on compensation and governance matters

   Have a comprehensive Code of Business Conduct and Ethics and Corporate Governance Guidelines

 

×   Guarantee bonuses

   Have minimum vesting periods written into our Amended and Restated Equity Incentive Plan

   Grant the Board and each committee express authority to retain outside advisors

 

×   Have “single trigger” change of control provisions in executive employment agreements

 

A brief summary of our STI and LTI plans for 2017 is provided below:

 

Short-Term Incentive Plan (Annual Bonus) Features

Metrics

        Weighting

Rental Revenue

 

50%

Adjusted EBITDA

 

 

50%

37


 

 

Long-Term Incentive Plan Features

Form of Equity Award

Weighting

2017 Grants

Restricted Stock

 

50%

 

Vests over four years (time based only vesting)

Stock Options

 

50%

 

“Performance-based” options which vest over three years only upon the achievement of annual performance criteria

 

Stock Option Performance Criteria

 

 

Return on Capital Employed (“ROCE”)

 

2017 Compensation Highlights:

 

Base salaries for our NEOs increased between 0% and 5.5%.

 

The 2017 annual STI (bonus) plan, which was paid in February 2018, was paid at 182.5% of target.

 

NEOs received LTI plan awards granted in the form of performance-based options and restricted stock.

 

o

Performance criteria related to the first tranche of the performance-based options granted in 2017 vested at 162.8%. The remaining tranches are contingent on achievement of performance criteria in 2018 and 2019.

 

o

Performance criteria related to the second tranche of the performance-based options granted in 2016 were not met. Therefore, the shares related to this tranche were forfeited. The remaining tranches are contingent on achievement of performance criteria in 2018.

For more information please refer to “Our Executive Compensation Program in Detail” section.

2017 Say-on-Pay Results and Stockholder Outreach, the Committee’s Response and 2017 Changes

At our 2017 Annual Meeting, we received substantial support for our executive compensation program, with approximately 97% of the stockholders who voted on the Say-on-Pay proposal approving the compensation of our NEOs. We interpreted this exceptionally strong level of support as affirmation of the structure of our program and our approach to making compensation decisions. As a result, we did not make substantive changes to the program design following the 2017 Annual Meeting.

We value our stockholders’ perspective on our business and each year interact with stockholders through numerous stockholder engagement activities. In 2017, these activities included participation in investor conferences, meetings with individual stockholders throughout the year, as well as meeting with stockholders and answering questions at our 2017 Annual Meeting.

As part of this outreach, beginning in December 2017, we contacted each of our top 30 stockholders, representing approximately 90% of our outstanding shares, for feedback relating to our corporate governance and executive compensation programs. Additionally, we offered meetings with senior management and the chairs of our Compensation and Governance Committees. Of the investors we contacted, holders representing approximately 21% of our outstanding shares participated in meetings with management.

From the investors we spoke to, we received the following feedback:

 

General praise for the strong and proactive changes the Company has made in pay practices and corporate governance in recent years, particularly adopting best governance policies;

 

Strong support for the Company’s STI and LTI plans which include metrics related to revenue, adjusted EBITDA and ROCE;

 

No preference was expressed for any particular equity vehicle or performance metric as long as awards are linked to how the Company is managed and drive returns for stockholders;

 

Support for our recent adoption of Proxy Access; and

 

No other pay or governance concerns or issues were raised for the Committee to consider.

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OUR EXECUTIVE COMPENSATION PROGRAM FRAMEWORK

Our Compensation Philosophy and Objectives

There are three primary tenets that support Mobile Mini’s executive compensation philosophy and objectives:

 

Attract, motivate and retain superior people in key positions. We believe executives’ target total direct compensation (“TDC”) should be competitive with that being offered to individuals holding comparable positions at other public companies with which we compete for market share and executive talent. We use a mix of fixed (cash) and variable (cash and equity) pay to support this objective.

 

Reward the achievement of identified financial goals by the Company. We believe that a significant portion of an executive’s TDC should be variable and emphasize an appropriate balance of both short- and long-term financial and strategic performance. We focus our executives on performance measures that we believe are critical to enhancing long-term stockholder value creation.

 

Align the interests of the Company’s executives with those of its stockholders. We believe delivering a significant portion of TDC to our NEOs in the form of long-term incentives that are impacted by our stock price provides a clear incentive to drive long-term stockholder value creation. It also supports our retention goals, encourages stock ownership and does not promote unnecessary or excessive risk taking. This mix of cash, short and long-term incentives and their corresponding performance measures, along with our clawback policy, anti-hedging policy and stock ownership requirements also discourages unnecessary or excessive risk taking.

Our 2017 executive compensation program is comprised of the following:

 

Element

 

Form

 

Purpose/Description

Base Salary

 

Cash 

(Fixed)

 

•  Provide a competitive base salary rate relative to similar positions in the market, which enables the Company to attract and retain highly skilled executive talent. NEOs are generally eligible for increases annually, depending on Company and individual performance.

Annual STI (Bonus)

 

Cash
(Variable)

 

•  Provide competitively-based annual incentive awards for achieving Mobile Mini’s short-term financial goals measured over the current year.

 

•  2017 targets are based on the achievement of specific rental revenue and adjusted EBITDA objectives.

Annual LTI

 

Equity
(Variable)

 

•  Provide incentives for executives to reach financial goals and align their long-term economic interests with stockholders and serve as a retention tool.

 

•  50% performance-based stock options with an exercise price equal to the stock price at grant.

  Eligible to vest annually over three years.

  Vesting is based on an initial ROCE target and thereafter on annual improvement in ROCE year-over-year.

  If minimum targets are not achieved, no options will vest. Participants may earn from 50% to 200% of the target options awarded depending upon actual results once minimum performance targets are achieved. Options that do not vest in any given year are forfeited.

  There is no “look back” or right to re-earn options not earned in prior years.

 

•  50% of the grant value is time-based (service-vested over four years) restricted stock.

 

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The Committee has historically split the equity vehicles between 50% time-based vesting equity, which it views as a being a retention tool, and 50% performance-based equity, which the Committee views as a tool to incentivize long-term goal achievement.

NEOs are also eligible for other benefits, including a qualified 401(k) Plan that provides participants with the opportunity to defer a portion of their compensation, up to tax code limitations, and receive a company matching contribution. Modest ancillary benefits are also provided to executives by the Company. See “401(k) Savings Plans and Other Retirement Benefits” below for more information.

Pay Mix

The charts below show that most of our NEOs’ target TDC (i.e., base salary, annual STI (bonus), and annual LTI (equity)) is variable (74% for our CEO and an average of 65% for our other NEOs). The pay mix is based on current annual base salary and STI and LTI at target as a percentage of base salary.  The pay mix discussion includes the five NEOs with the highest structured target total direct compensation as of December 31, 2017.  These charts exclude the value of other benefits and perquisites and are calculated as though each of the NEOs were in their position for all of 2017.  The pay mix does not reflect adjustments related to the initial year of hire for Mr. Welch and Mr. Krivoruchka. It also does not include Mr. Funk, who departed the Company in July 2017, or Mr. Ainsworth, who will likely not be an NEO in 2018.

Both individual compensation elements and TDC are structured to be closely aligned with the compensation of similarly-sized, U.S.-based companies in our industry and related industries. See “The Decision Making Process – The Role of Benchmarking and Peer Groups” section below for a discussion of our peer groups. We believe the salaries we pay to our NEOs are appropriate relative to the salary levels paid by Mobile Mini’s peer group. This belief is supported by the results of Mercer’s 2017 compensation review, which reflected that our base salaries were generally between the 50th and 75th percentile levels in the aggregate relative to market.

In developing the target TDC arrangement for our CEO, the Board placed significant emphasis on aligning Mr. Olsson’s compensation with stockholder value creation. Particular emphasis was placed on stock-based compensation, which has inherent performance criteria. Mr. Olsson’s target TDC for fiscal year 2017 was $3.8 million, which was the same as fiscal 2016.

 

Element of CEO's Target Total Direct Compensation

 

2016 Target TDC

 

 

2017 Target TDC

 

Base Salary

 

$

1,000,000

 

 

$

1,000,000

 

Target Annual STI (Bonus)

 

 

1,000,000

 

 

 

1,000,000

 

Target Annual LTI (Equity)

 

 

1,800,000

 

 

 

1,800,000

 

 

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The Role of Benchmarking and Peer Groups

As part of our pay philosophy, our executive compensation program is designed to attract, motivate and retain our executives in an increasingly competitive and complex talent market. To this end, we regularly evaluate industry-specific and general market compensation practices and trends to ensure that our program features and NEO pay opportunities remain appropriately competitive. When determining salaries, target bonus opportunities and annual long-term incentive grants for NEOs, the Committee considers the performance of the Company and the individual, the nature of an individual’s role within the Company, experience in the officer’s current role, as well as input from its independent compensation consultant, among other factors.

In 2017, to facilitate its review and determination of executive compensation, the Committee engaged Mercer to conduct a comprehensive, competitive review of our executive compensation program. In connection with this review and in consultation with Mercer and senior management of the Company, the Committee identified a peer group composed of industry competitors and related industry companies roughly similar to the Company in revenue size or market capitalization. The peer group consisted of the 15 companies listed in the table below:

 

Peer Group

 

Peer Data (in millions)*

Aircastle Limited

 

HERC Holdings Inc.

 

Percentile

 

Revenue

 

 

Market Cap

 

 

Air Lease Corporation

 

McGrath Rentcorp

 

25th

 

$

466

 

 

$

745

 

 

Advanced Disposal Services, Inc.

 

Ritchie Bros. Auctioneers Incorporated

 

50th

 

 

814

 

 

 

1,449

 

 

CAI International, Inc.

 

Civeo Corporation

 

75th

 

 

1,401

 

 

 

2,250

 

 

Casella Waste Systems, Inc.

 

Team, Inc.

 

 

 

 

 

 

 

 

 

 

 

GATX Corporation

 

United Rentals, Inc.

 

Mobile Mini

 

$

534

 

 

$

1,531

 

 

General Finance Corporation

 

US Ecology, Inc.

 

 

 

 

 

 

 

 

 

 

 

H&E Equipment Services, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

*

Market Capitalization is as of December 31, 2017. Revenue is for the year ended December 31, 2017.

In addition to peer group data, two published compensation surveys were also used in Mercer’s 2017 report and comparisons to survey benchmark positions were made based on Mobile Mini’s size. Mercer completed its review in December 2017 and presented its analysis of the Company’s executive compensation program relative to peer and survey 25th, 50th and 75th percentile levels. Overall, the study found that Mobile Mini’s target TDC was between the 50th and 75th percentile market levels.

OUR EXECUTIVE COMPENSATION PROGRAM IN DETAIL

Base Salary

Mobile Mini provides NEOs a base salary to compensate them for services rendered during the fiscal year. Base salary for each NEO is determined on the basis of his or her position and responsibility. During its review of base salaries, the Committee primarily considers the CEO’s assessment of each NEO’s individual performance and input from its independent compensation consultant. Salary levels are considered annually as part of the Committee’s year-end review process, and in conjunction with the annual budget and performance forecasting of management, which is generally conducted between December and January of each year. The Committee determined the appropriate base salary for each NEO as follows:

 

NEO

 

2016 Base Salary

 

 

2017 Base Salary

 

 

Increase

 

Erik Olsson

 

$

1,000,000

 

 

$

1,000,000

 

 

 

0.0

%

Mark Funk

 

 

450,090

 

 

n/a

 

 

n/a

 

Van Welch

 

n/a

 

 

 

485,000

 

 

n/a

 

Kelly Williams

 

 

440,090

 

 

 

462,000

 

 

 

5.0

%

Mark Krivoruchka

 

n/a

 

 

 

375,000

 

 

n/a

 

Christopher J. Miner

 

 

330,697

 

 

 

349,000

 

 

 

5.5

%

Chad Ainsworth

 

 

210,000

 

 

 

218,000

 

 

 

3.8

%

 

Base salaries are shown as of the end of the applicable year.

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Short-Term Incentive Plan

In 2017, bonus targets were based on Rental Revenue growth and adjusted EBITDA targets. Each criterion functions independently and the threshold payout is 50%, with maximum payout of 200% for each criterion. We chose to use these metrics for the annual STI (bonus) plan, as the Committee believes that Rental Revenue growth is an effective short-term performance indicator and over time drives long-term stockholder returns. Additionally, given the capital intensive nature of our business, the Committee believes that adjusted EBITDA is an appropriate measure of profitable growth.  Using these metrics differentiates the short-term financial goals from those used for long-term incentives.

Target annual STI (bonus) opportunities are expressed as a percentage of base salary, and were established by the Committee based on each NEO’s level of responsibility and his or her ability to impact overall results. The Committee also considers market data in setting target award amounts. Target and maximum award opportunities in our current structure are as follows:

 

 

 

Target Award Opportunity

(% of Annual Base Salary)

 

NEO

 

Threshold

 

 

Target

 

 

Maximum

 

Erik Olsson

 

50.0%

 

 

100%

 

 

200%

 

Van Welch

 

37.5%

 

 

75%

 

 

150%

 

Mark Funk

 

37.5%

 

 

75%

 

 

150%

 

Kelly Williams

 

37.5%

 

 

75%

 

 

150%

 

Mark Krivoruchka

 

37.5%

 

 

75%

 

 

150%

 

Christopher Miner

 

37.5%

 

 

75%

 

 

100%

 

Chad Ainsworth

 

25.0%

 

 

50%

 

 

100%

 

 

Actual bonus payouts depend on the achievement of specific financial goals, and can range from 0% to 200% of target award amounts. For 2017, NEO bonus payouts were based on the achievement of Rental Revenue and adjusted EBITDA targets, each of which were weighted equally (i.e., 50% for each). Generally, the Committee endeavors to set the target payout level such that the relative difficulty of achieving the goal is anticipated to be consistent from year to year.

The Company’s budgeting process and the related establishment of bonus payout levels involve the formulation of various operating budgets using different assumptions concerning factors that have a direct and measurable effect on the Company’s financial and operating performance. These factors may include, for example, trends in general economic conditions, trends in specific industries (such as the non-residential construction industry or the retail trade industry), in which large numbers of the Company’s customers operate, interest rates and other factors. The performance goals may be adjusted to account for acquisitions, fluctuations in currency exchange rates, and other events that have quantifiable effects on the Company’s results of operations, including the metrics used in the incentive compensation plans. The relationship between the level of performance achieved and overall bonus payout is as follows:

 

 

 

Rental Revenue

 

 

Adjusted EBITDA

 

 

 

Performance Achieved

 

 

Bonus Payout

 

 

Performance Achieved

 

 

Bonus Payout

 

Performance Level

 

as % of Target

 

 

as % of Target

 

 

as % of Target