Executive pay and board changes detailed at LivePerson (NASDAQ: LPSN)
Filing Impact
Filing Sentiment
Form Type
10-K/A
LivePerson, Inc. filed Amendment No. 1 to its 2025 annual report to add Part III details on directors, governance, executive and director pay, and equity plans, without changing prior financial statements. The filing outlines an experienced, tech‑focused board and key committee structures, including an Audit Committee chaired by Karin‑Joyce Tjon, designated as the audit committee financial expert.
For 2025, CEO John Sabino’s total compensation was $1,039,037, with a mix of salary, annual bonus and restricted stock units, while CFO/COO John Collins and CTO Christopher Mina also received equity awards tied to retention and performance. Company‑wide bonuses funded at about 32% of target based on B2B revenue and free cash flow metrics. The amendment also describes stock ownership guidelines, a clawback policy, and the structure and capacity of LivePerson’s stock incentive and inducement plans.
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Key Figures
Non-affiliate market value: $84,994,598
Shares outstanding: 12,053,603 shares
CEO total compensation: $1,039,037
+5 more
8 metrics
Non-affiliate market value
$84,994,598
Aggregate market value of voting common stock as of June 30, 2025
Shares outstanding
12,053,603 shares
Common stock outstanding on March 6, 2026
CEO total compensation
$1,039,037
John Sabino 2025 total pay
COO/CFO retention bonus payment
$50,000
Second payment of $100,000 retention bonus to John D. Collins in 2025
Bonus payout ratio
32% of target
2025 annual bonus payouts for named executive officers
B2B Free Cash Flow achievement
($15) million
2025 B2B Free Cash Flow used for bonus funding at 40% pool level
Equity plan overhang
960,620 shares
Total securities to be issued under outstanding options and RSUs as of December 31, 2025
Equity plan capacity
240,616 shares
Shares remaining for future issuance under equity compensation plans as of December 31, 2025
Key Terms
B2B Recurring Revenue, Adjusted EBITDA, reverse stock split, Change in Control, +2 more
6 terms
B2B Recurring Revenue financial
"In designing the 2025 annual bonus program, the Compensation Committee sought to align the goals with investor interests, choosing B2B Recurring Revenue"
Adjusted EBITDA financial
"“Adjusted EBITDA” means net loss, before provision for (benefit from) income taxes, interest income (expense), net"
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
reverse stock split financial
"reflect the 1 to 15 share reverse split of the Company’s shares that occurred on October 15, 2025"
A reverse stock split is when a company reduces the number of its shares outstanding, making each share more valuable. For example, if you own 100 shares worth $1 each, a 1-for-10 reverse split would turn your 100 shares into 10 shares worth $10 each. Companies often do this to boost their stock price and appear more stable to investors.
Change in Control financial
"within the three-month period immediately prior to or the 12-month period immediately following a Change of Control"
A "change in control" occurs when the ownership or management of a company shifts significantly, such as through a merger, acquisition, or sale of a large part of its assets. This change can impact how the company is run and may influence its future direction. For investors, it matters because it can affect the company's stability, strategy, and value, often signaling potential changes in investment risk or opportunity.
clawback policy financial
"We maintain an amended and restated omnibus clawback policy (the “Clawback Policy”), effective as of October 2, 2023"
A clawback policy is a company rule that lets the firm take back pay, bonuses or stock awards from current or former executives if results are later found to be incorrect, misconduct occurred, or targets were missed. It matters to investors because it helps protect the value of their holdings by discouraging risky or fraudulent behavior and ensuring executive rewards reflect real, verified performance—think of it as a return policy for executive pay.
Inducement Plan financial
"Amended and Restated LivePerson, Inc. 2018 Inducement Plan"
An inducement plan is a program a company creates to encourage employees or new hires to stay or join by offering special benefits or rewards. It’s like a company giving extra bonuses or perks to persuade someone to choose their job over others, helping the company attract and keep talented workers.
LivePerson, Inc. (the “Company”) is a leader in digital customer conversation. Since 1998, LivePerson has enabled meaningful connections between consumers and its customers through digital and artificial intelligence (“AI”)-powered conversations. Our customers’ existing investments in Generative AI and Large Language Models (“LLMs”) are fully compatible with LivePerson’s enterprise-class digital customer conversation platform (the “LivePerson Platform”).
The LivePerson Platform powers conversations across each of a brand’s primary digital channels, including mobile apps, mobile and desktop web browsers, short messaging service, social media and third-party consumer messaging platforms. Brands can also use the LivePerson Platform to connect conversations across voice and digital channels to give customers additional options and ensure their interactions with brands are integrated no matter where they choose to reach out.
The LivePerson Platform enables what the Company calls “the tango” of humans, LivePerson bots, third-party bots and LLMs, in which humans oversee and are assisted by AI and can seamlessly step into conversations as needed. Agents become highly efficient, as they are able to leverage the AI engine (including generative AI capabilities) to surface relevant content, define next-best actions and take over repetitive transactional work so that the agent can focus on relationship building. By integrating customer engagement channels, LivePerson’s proprietary AI, and third-party bots and AI, the LivePerson Platform offers brands a comprehensive approach to scaling automations across customer conversations.
Basis of Presentation
In October 2025, the Company effected a 1-for-15 reverse stock split (the “Reverse Stock Split”) of its issued common stock. As a result, every 15 shares of its issued common stock were combined into one share of common stock. No fractional shares of the Company’s common stock were issued as a result of the Reverse Stock Split. Each stockholder who would otherwise have been entitled to receive a fractional share as a result of the Reverse Stock Split received a cash payment equal to the product obtained by multiplying the number of shares of common stock held by such stockholder before the Reverse Stock Split that would otherwise have been exchanged for such fractional share interest by the closing price per share of the common stock as reported on the Nasdaq Global Select Market on October 10, 2025. As a result of the Reverse Stock Split, proportionate adjustments were made to the per share exercise price and the number of shares issuable upon the exercise of, or notional shares underlying, all outstanding warrants to purchase shares of the Company’s common stock. In addition, the number of authorized shares of common stock was proportionately reduced. Proportionate adjustments were also made to (i) the number of shares of common stock available for issuance under the Company’s equity plans, (ii) the number of shares underlying, and the exercise prices of, outstanding equity awards, as applicable, that have been previously granted under such equity plans or other arrangements, (iii) the number of shares or notional shares underlying, and the exercise prices of, the Company’s outstanding warrants, (iv) the number of shares or notional shares underlying, and the conversion prices of, the Company’s outstanding convertible notes and (v) the number of rights outstanding pursuant to the Company’s Tax Benefits Preservation Plan, in each case in accordance with their respective terms. The Reverse Stock Split did not affect the par value of the common stock or the number of shares of preferred stock that the Company is authorized to issue under its certificate of incorporation. These notes to the consolidated financial statements and the accompanying consolidated financial statements give retroactive effect to the Reverse Stock Split for all periods presented.
Principles of Consolidation
The consolidated financial statements reflect the operations of LivePerson and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Certain prior period amounts have been reclassified to conform to current period presentation. These reclassifications had no effect on previously reported net loss or equity.
Related Parties
Related parties include entities related to the Company’s directors or main stockholders as well as, in the past, equity method affiliates. During the year ended December 31, 2023, the Company provided services to Claire Holdings, Inc. (“Claire”), an equity method affiliate, in exchange for fees through certain commercial arrangements. These arrangements facilitated Claire’s build out and operations.
In connection with the joint venture agreement relating to the formation of Claire, the Company entered into commercial agreements with Claire, under which the Company agreed to provide custom software development and managed services in exchange for fees governed by the terms and conditions set forth therein. In accordance with guidance under ASC 606, Claire was considered a customer of the Company. No services were provided to Claire for the years ended December 31, 2025 or 2024, compared to revenues of $3.8 million for the year ended December 31, 2023.
Use of Estimates
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. These estimates are based on information available as of the date of the consolidated financial statements. On a regular basis, management evaluates these estimates and assumptions.
Items subject to such estimates and assumptions include, but are not limited to:
•stock-based compensation expense;
•allowance for credit losses;
•the period of benefit for deferred contract acquisition costs;
•valuation of goodwill;
•valuation and useful lives of long-lived assets;
•valuation of the cash-settled and share-settled warrants (together, “Warrants”);
•valuation of features embedded in the 2029 Notes (as defined below);
•income taxes; and
•recognition, measurement, and disclosure of contingent liabilities.
As of the date of issuance of the financial statements, the Company is not aware of any material specific events or circumstances that would require it to update its estimates, judgments, or to revise the carrying values of its assets or liabilities. These estimates may change, as new events occur and additional information is obtained, and are recognized in the consolidated financial statements as soon as they become known. Actual results could differ from those estimates and any such differences may be material to the Company’s consolidated financial statements.
Foreign Currency Translation
The Company’s operations are conducted in various countries around the world and the financial statements of its foreign subsidiaries are reported in the applicable foreign currencies (functional currencies). Financial information is translated from the applicable functional currency to the United States of America (“U.S.”) dollar (the reporting currency) for inclusion in the Company’s consolidated financial statements. Income, expenses, and cash flows are translated at weighted average exchange rates prevailing during the fiscal period, and assets and liabilities are translated at fiscal period-end exchange rates. Resulting translation adjustments are included as a component of accumulated other comprehensive loss in stockholders’ equity (deficit). Foreign exchange transaction gains or losses are included in Other income (expense), net in the accompanying consolidated statements of operations, and were not material for the years ended December 31, 2025, 2024 and 2023.
Cash, Cash Equivalents and Restricted Cash
The Company considers all highly liquid securities with original maturities of three months or less when acquired to be cash equivalents. Cash equivalents, which primarily consist of money market funds, are recorded at cost, which approximates fair value. Restricted cash primarily related to funds held in connection with the divestiture of Kasamba. Risks associated with cash and cash equivalents are mitigated by banking with creditworthy institutions. Such balances with any one institution may, at times, be in excess of federally insured amounts.
Prepaid Expenses and Other Current Assets
The following table presents the detail of prepaid expenses and other current assets as of the dates presented:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (In thousands) | |||||||||||
| Prepaid software maintenance | $ | 8,788 | $ | 9,868 | |||||||
| VAT receivable | 3,279 | 2,452 | |||||||||
| Other prepaid expenses | 1,550 | 2,910 | |||||||||
| Other current assets | 1,483 | 4,020 | |||||||||
| Total prepaid expenses and other current assets | $ | 15,100 | $ | 19,250 | |||||||
Goodwill
Goodwill represents the excess of the aggregate purchase price over the fair value of net identifiable assets acquired in a business combination. The Company evaluates goodwill for impairment on an annual basis on October 1, and more frequently whenever events or substantive changes in circumstances indicate that it is more likely than not that the carrying value of a reporting unit exceeds its fair value in accordance with ASC 820, Fair Value Measurement. In performing the goodwill impairment test, the Company first assesses qualitative factors to determine the existence of impairment. If the qualitative factors indicate that the carrying value of a reporting unit more likely than not exceeds its fair value, the Company proceeds to a quantitative test to measure the existence and amount, if any, of goodwill impairment. The Company may also choose to bypass the qualitative assessment and proceed directly to the quantitative test. In performing the quantitative test, impairment loss is recorded to the extent that the carrying value of the reporting unit exceeds its assessed fair value.
In connection with the annual impairment test performed as of October 1, 2025 and the interim test performed as of December 31, 2025 using the quantitative “Step 1” assessment, the Company determined the fair value of its reporting unit, using both an income approach and a market approach. The income approach uses a discounted cash flow model that reflects our assumptions regarding revenue growth rates, operating margins, risk-adjusted discount rate, economic and market trends and other expectations about the anticipated operating results of the reporting unit. Under the market approach, we estimate the fair value based on market multiples of revenues derived from comparable publicly traded companies with operating characteristics similar to the reporting unit. See Note 5 – Goodwill and Intangible Assets, Net for additional information.
Long-lived Assets
Intangible assets
Intangible assets with estimable useful lives are amortized over their respective estimated useful lives to their estimated residual values, and reviewed for impairment in accordance with ASC 360-10-35, Accounting for Impairment or Disposal of Long-Lived Assets. The Company’s capitalized patents are stated at cost, which approximates fair value at inception, and are amortized on a straight-line basis over their estimated economic lives, which is approximately 11 years on a weighted average basis. See Note 5 – Goodwill and Intangible Assets, Net for additional information.
Property and Equipment, Net
Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation and amortization is calculated using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or the estimated useful life of the asset. The Company reviews the estimated useful lives of its property and equipment on an annual basis.
Internal-Use Software Development Costs
The Company capitalizes its costs to develop its internal-use software when preliminary development efforts are successfully completed, management has authorized and committed project funding, and it is probable that the project will be completed and the software will be used as intended. These costs are included in Property and equipment in the Company’s consolidated balance sheets and are amortized on a straight-line basis over the estimated useful life of the related asset, which approximates five years. Costs incurred prior to meeting these criteria, together with costs incurred for training and maintenance, are expensed as incurred. Management evaluates the useful lives of these assets and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. See Note 6 – Property and Equipment, Net for additional information.
Long-lived assets, such as property and equipment including internal-use software development costs, right of use assets and intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized at the amount by which the carrying amount of the asset exceeds its fair value. Assets to be disposed of would be separately presented in the consolidated balance sheets and reported at the lower of the carrying amount or fair value less costs to sell, and would no longer be depreciated.
Senior Notes and Warrants
Second Lien Senior Subordinated Secured Notes due 2029
The Company issued Second Lien Notes as part of the troubled debt restructuring in 2025. They are accounted for as a liability and a troubled debt restructuring gain was recorded in other income (expense), net. The Company paid third party fees in connection with the transaction, which reduced the gain recorded.
Convertible Notes
The Company accounts for convertible debt and related transactions in accordance with ASC 470, Debt, ASC 815, Derivatives and Hedging, and ASC 480, Distinguishing Liabilities from Equity. The Company evaluates convertible debt instruments and related transactions at inception to determine if those contracts include embedded features that should be bifurcated as an embedded derivative.
The First Lien Convertible Senior Notes due 2029 (the “2029 Notes”) issued during 2024 were accounted for as a liability. The transaction was accounted for as a debt extinguishment and a gain on extinguishment was recorded. The Company paid third party fees in connection with the transaction, which were capitalized as debt issuance costs. Unamortized debt issuance costs incurred in connection with securing the Company’s financing arrangements are presented in the consolidated balance sheets as a direct deduction from the carrying amount of the outstanding borrowings, consistent with debt discounts. All deferred financing costs are amortized to interest expense. The 2029 Notes include certain embedded features requiring bifurcation. The Company estimates the fair value of these features on a quarterly basis by assessing the likelihood of triggering events. The features do not have material values as of December 31, 2025 and 2024, but they may have value in the future, should the estimates change, with any change in fair value recorded in the Company’s consolidated statements of operations.
Warrants
The Company accounts for warrants as either stock-settled or cash-settled instruments based on an assessment of the specific terms of the warrants and applicable authoritative guidance in Financial Accounting Standards Board ASC 480, Distinguishing Liabilities from Equity and ASC 815-40, Contracts in Entity’s Own Equity. The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and meet all of the requirements for equity classification under ASC 815-40, including whether the warrants are indexed to the Company’s own stock and whether the events where holders of the warrants could potentially require net cash settlement are within the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance. Warrants that meet all of the criteria for equity classification are recorded as a component of additional paid-in capital at the time of issuance and are not remeasured. Warrants that do not meet the required criteria for equity classification are classified as liabilities. The Company adjusts such warrants to fair value at each reporting period until the warrants are exercised or expire.
The Warrants issued by the Company are classified as current liabilities in the consolidated balance sheets and recorded at their fair value. Changes in fair value are recorded in the Company’s consolidated statements of operations.
See Note 8 – Senior Notes, Capped Call Transactions, Warrants and Preferred Stock and Note 9 – Fair Value Measurements for additional information.
Divestitures
The Company classifies long-lived assets and liabilities to be disposed of as held for sale in the period in which they are available for immediate sale in their present condition and the sale is probable and expected to be completed within one year. The Company initially measures assets and liabilities held for sale at the lower of their carrying value or fair value less costs to sell. When the divestiture represents a strategic shift that has (or will have) a major effect on the Company’s operations and financial results, the disposal is presented as a discontinued operation.
Fiscal 2024 Divestiture
In the second quarter of 2024, the Company completed the sale to a third party of 100% of the equity in its WildHealth reporting unit (“WildHealth”), which was created by the acquisition of WildHealth, Inc. in 2022. Pursuant to ASC Subtopic 205-20, Presentation of Financial Statements - Discontinued Operations, the divestiture did not meet the criteria for presentation as a discontinued operation. WildHealth was part of the Business segment and was a separate reporting unit. The transaction resulted in a loss of $0.6 million which was recognized and presented separately in Loss (gain) on divestiture on the Company’s consolidated statements of operations for the year ended December 31, 2024. Subsequent to the closing, the Company does not have ongoing involvement or arrangements with WildHealth.
Fiscal 2023 Divestiture
In the first quarter of 2023, the Company completed the sale of Kasamba, Inc. and Kasamba LTD (together, “Kasamba”) to Ingenio, LLC, for $16.9 million which was received in cash upon closing; and $2.6 million deferred payment to be received within a year of the close transaction date. Cash of $2.0 million was classified as Cash and cash equivalents on the consolidated balance sheet as of December 31, 2024 and was released in June 2024. The transaction resulted in a gain of $17.6 million, which was presented separately in Loss (gain) on divestiture on the Company’s consolidated statements of operations during the year ended December 31, 2023. During the year ended December 31, 2024, the Company recognized $1.8 million of post-closing adjustments pertaining to the final agreement amount which is recorded in General and administrative expenses in the consolidated statements of operations.
Advertising
The Company expenses the cost of advertising and promoting its services as incurred in Sales and marketing expense on the consolidated statements of operations. Such costs totaled $1.8 million, $5.1 million, and $10.9 million for the years ended December 31, 2025, 2024, and 2023, respectively.
Research and Development
Research and development (“R&D”) costs are expensed when incurred, except for certain internal-use software development costs, which may be capitalized as noted above. R&D expenses consist primarily of personnel and related headcount costs, costs of professional services associated with the ongoing development of the Company’s technology, and allocated overhead, and are included in Product development in the consolidated statements of operations.
Stock-Based Compensation
Compensation related to stock-based awards to employees and directors is measured and recognized in the Company’s consolidated statements of operations based on the fair value of the awards granted. The Company estimates the fair value of its stock options using the Black Scholes option pricing model. The stock-based compensation expense relating to stock options is recognized on a straight-line basis over the period during which the employee or director is required to provide service in exchange for the award, usually the vesting period, which is generally one to four years.
Restricted stock units (“RSUs”) are generally subject to a service-based vesting condition over one to four years. The valuation of these RSUs is based solely on the Company’s stock price on the date of grant, and the corresponding compensation expense is amortized on a straight-line basis.
Performance-Vesting Restricted Stock Units (“PRSUs”) granted are generally subject to both a service-based vesting condition and a performance-based vesting condition. PRSUs will vest upon the achievement of specified performance targets and subject to continued service through the applicable vesting dates. The associated compensation cost is recognized over the requisite service period when it is probable that the performance condition will be satisfied.
In accordance with ASC 718-10, Compensation - Stock Compensation, the Company measures stock-based awards at fair value and recognizes compensation expense for all stock-based payment awards made to its employees and directors, including employee stock options. See Note 11 – Stockholders’ Equity for additional information.
Leases
The Company has non-cancelable operating and finance leases for its corporate offices and other service agreements. Its leases have remaining lease terms of approximately 1 year, some of which include options to extend. The Company uses the non-cancelable lease term when recognizing the right-of-use (“ROU”) assets and lease liabilities, unless it is reasonably certain that a renewal or termination option will be exercised.
Lease costs were $9.4 million, $10.6 million and $15.3 million for the years ended December 31, 2025, 2024 and 2023, respectively. Weighted average remaining lease terms for operating leases were 1.1 years and 0.3 years as of December 31, 2025 and 2024, respectively, and for finance leases were 0.0 years and 0.8 years as of December 31, 2025 and 2024, respectively. The weighted average discount rates were 7% for operating and finance leases as of both December 31, 2025 and 2024.
Operating and finance ROU assets, and operating and finance lease liabilities were not material as of December 31, 2025 and 2024, and future minimum lease payments under non-cancelable operating and finance leases are not material.
Income Taxes
Income taxes are accounted for under the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in results of operations in the period that the tax change occurs. In evaluating the Company’s ability to recover its deferred tax assets in the jurisdiction from which they arise, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax-planning strategies, and results of recent operations. The Company includes interest accrued on the underpayment of income taxes and certain interest expense and penalties, if any, related to unrecognized tax benefits as a component of the income tax provision. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.
Comprehensive Loss
In accordance with ASC 220, Comprehensive Income, the Company reports by major components and as a single total, the change in its net assets during the period from non-owner sources. Comprehensive loss consists of net loss and accumulated other comprehensive loss, which includes certain changes in equity that are excluded from net loss. The Company’s comprehensive loss for all periods presented is related to the effect of foreign currency translation.
Recently Adopted Accounting Pronouncements
In December 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which modifies the rules on income tax disclosures to require entities to disclose (1) specific categories in the rate reconciliation, (2) the income or loss from continuing operations before income tax expense or benefit (separated between domestic and foreign) and (3) income tax expense or benefit from continuing operations (separated by federal, state and foreign). ASU 2023-09 also requires entities to disclose their income tax payments to international, federal, state and local jurisdictions, among other changes. The guidance is effective for annual periods beginning after December 15, 2024. The Company adopted this guidance in the fourth quarter of 2025 on a prospective basis, with disclosures related to the current year presented in accordance with the new standard. Adoption of the guidance did not have a material impact on the Company’s consolidated financial statements; however the disclosures in Note 14 - Income Taxes have been expanded.
Recently Issued Accounting Pronouncements
In December 2025, the FASB issued ASU 2025-12, Codification Improvements, which seeks to make incremental improvements to GAAP on a broad range of topics arising from technical corrections, unintended application of guidance, clarifications and other minor improvements. The guidance is effective for interim reporting periods within annual reporting periods beginning after December 15, 2026, with early adoption permitted, and can be applied on an issue-by-issue basis, prospectively or retrospectively. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.
In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270) - Narrow-Scope Improvements which improves the navigability of the required interim disclosures and clarifies when that guidance is applicable. The guidance is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted, and can be applied prospectively or retrospectively. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.
In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which removes all references to project stages related to internal-use software development. An entity is required to start capitalizing software costs when both of the following occur: (1) management has authorized and committed to funding the software project and (2) it is probable that the project will be completed and the software will be used to perform the function intended. The guidance is effective for annual periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.
In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Top 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provides all entities with a practical expedient when estimating expected credit losses for current accounts receivable and current contract assets arising from certain transactions. In developing reasonable and supportable forecasts as part of estimating expected credit losses, all entities may elect a practical expedient that assumes that current conditions as of the balance sheet date do not change for the remaining life of the asset. The guidance is effective for annual periods beginning after December 15, 2025, with early adoption permitted. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.
In November 2024, the FASB issued ASU 2024-04, Debt - Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments, which seeks to clarify the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. The amendments in this update are effective for annual periods beginning after December 15, 2025, and early adoption is permitted. ASU 2024-04 can be applied prospectively or retrospectively. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.
In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40), which seeks to expand disclosures about a public entity’s expenses, including more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation, amortization, and depletion) in commonly presented expense captions (such as cost of sales, sales and marketing, general and administrative, and research and development). The amendments in this update are effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. Early adoption is permitted for both interim and annual financial statements that have not yet been issued or made available for issuance. ASU 2024-03 should be applied retrospectively. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.
Principles of Consolidation
The consolidated financial statements reflect the operations of LivePerson and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Certain prior period amounts have been reclassified to conform to current period presentation. These reclassifications had no effect on previously reported net loss or equity.
Use of Estimates
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. These estimates are based on information available as of the date of the consolidated financial statements. On a regular basis, management evaluates these estimates and assumptions.
Items subject to such estimates and assumptions include, but are not limited to:
•stock-based compensation expense;
•allowance for credit losses;
•the period of benefit for deferred contract acquisition costs;
•valuation of goodwill;
•valuation and useful lives of long-lived assets;
•valuation of the cash-settled and share-settled warrants (together, “Warrants”);
•valuation of features embedded in the 2029 Notes (as defined below);
•income taxes; and
•recognition, measurement, and disclosure of contingent liabilities.
As of the date of issuance of the financial statements, the Company is not aware of any material specific events or circumstances that would require it to update its estimates, judgments, or to revise the carrying values of its assets or liabilities. These estimates may change, as new events occur and additional information is obtained, and are recognized in the consolidated financial statements as soon as they become known. Actual results could differ from those estimates and any such differences may be material to the Company’s consolidated financial statements.
Foreign Currency Translation
The Company’s operations are conducted in various countries around the world and the financial statements of its foreign subsidiaries are reported in the applicable foreign currencies (functional currencies). Financial information is translated from the applicable functional currency to the United States of America (“U.S.”) dollar (the reporting currency) for inclusion in the Company’s consolidated financial statements. Income, expenses, and cash flows are translated at weighted average exchange rates prevailing during the fiscal period, and assets and liabilities are translated at fiscal period-end exchange rates. Resulting translation adjustments are included as a component of accumulated other comprehensive loss in stockholders’ equity (deficit). Foreign exchange transaction gains or losses are included in Other income (expense), net in the accompanying consolidated statements of operations, and were not material for the years ended December 31, 2025, 2024 and 2023.Cash, Cash Equivalents and Restricted Cash
The Company considers all highly liquid securities with original maturities of three months or less when acquired to be cash equivalents. Cash equivalents, which primarily consist of money market funds, are recorded at cost, which approximates fair value. Restricted cash primarily related to funds held in connection with the divestiture of Kasamba. Risks associated with cash and cash equivalents are mitigated by banking with creditworthy institutions. Such balances with any one institution may, at times, be in excess of federally insured amounts.
The following table presents the detail of prepaid expenses and other current assets as of the dates presented:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (In thousands) | |||||||||||
| Prepaid software maintenance | $ | 8,788 | $ | 9,868 | |||||||
| VAT receivable | 3,279 | 2,452 | |||||||||
| Other prepaid expenses | 1,550 | 2,910 | |||||||||
| Other current assets | 1,483 | 4,020 | |||||||||
| Total prepaid expenses and other current assets | $ | 15,100 | $ | 19,250 | |||||||
Goodwill
Goodwill represents the excess of the aggregate purchase price over the fair value of net identifiable assets acquired in a business combination. The Company evaluates goodwill for impairment on an annual basis on October 1, and more frequently whenever events or substantive changes in circumstances indicate that it is more likely than not that the carrying value of a reporting unit exceeds its fair value in accordance with ASC 820, Fair Value Measurement. In performing the goodwill impairment test, the Company first assesses qualitative factors to determine the existence of impairment. If the qualitative factors indicate that the carrying value of a reporting unit more likely than not exceeds its fair value, the Company proceeds to a quantitative test to measure the existence and amount, if any, of goodwill impairment. The Company may also choose to bypass the qualitative assessment and proceed directly to the quantitative test. In performing the quantitative test, impairment loss is recorded to the extent that the carrying value of the reporting unit exceeds its assessed fair value.
In connection with the annual impairment test performed as of October 1, 2025 and the interim test performed as of December 31, 2025 using the quantitative “Step 1” assessment, the Company determined the fair value of its reporting unit, using both an income approach and a market approach. The income approach uses a discounted cash flow model that reflects our assumptions regarding revenue growth rates, operating margins, risk-adjusted discount rate, economic and market trends and other expectations about the anticipated operating results of the reporting unit. Under the market approach, we estimate the fair value based on market multiples of revenues derived from comparable publicly traded companies with operating characteristics similar to the reporting unit. See Note 5 – Goodwill and Intangible Assets, Net for additional information.
Long-lived Assets
Intangible assets
Intangible assets with estimable useful lives are amortized over their respective estimated useful lives to their estimated residual values, and reviewed for impairment in accordance with ASC 360-10-35, Accounting for Impairment or Disposal of Long-Lived Assets. The Company’s capitalized patents are stated at cost, which approximates fair value at inception, and are amortized on a straight-line basis over their estimated economic lives, which is approximately 11 years on a weighted average basis. See Note 5 – Goodwill and Intangible Assets, Net for additional information.
Property and Equipment, Net
Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation and amortization is calculated using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or the estimated useful life of the asset. The Company reviews the estimated useful lives of its property and equipment on an annual basis.
Internal-Use Software Development Costs
The Company capitalizes its costs to develop its internal-use software when preliminary development efforts are successfully completed, management has authorized and committed project funding, and it is probable that the project will be completed and the software will be used as intended. These costs are included in Property and equipment in the Company’s consolidated balance sheets and are amortized on a straight-line basis over the estimated useful life of the related asset, which approximates five years. Costs incurred prior to meeting these criteria, together with costs incurred for training and maintenance, are expensed as incurred. Management evaluates the useful lives of these assets and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. See Note 6 – Property and Equipment, Net for additional information.
Long-lived assets, such as property and equipment including internal-use software development costs, right of use assets and intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized at the amount by which the carrying amount of the asset exceeds its fair value. Assets to be disposed of would be separately presented in the consolidated balance sheets and reported at the lower of the carrying amount or fair value less costs to sell, and would no longer be depreciated.
Senior Notes and Warrants
Second Lien Senior Subordinated Secured Notes due 2029
The Company issued Second Lien Notes as part of the troubled debt restructuring in 2025. They are accounted for as a liability and a troubled debt restructuring gain was recorded in other income (expense), net. The Company paid third party fees in connection with the transaction, which reduced the gain recorded.
Convertible Notes
The Company accounts for convertible debt and related transactions in accordance with ASC 470, Debt, ASC 815, Derivatives and Hedging, and ASC 480, Distinguishing Liabilities from Equity. The Company evaluates convertible debt instruments and related transactions at inception to determine if those contracts include embedded features that should be bifurcated as an embedded derivative.
The First Lien Convertible Senior Notes due 2029 (the “2029 Notes”) issued during 2024 were accounted for as a liability. The transaction was accounted for as a debt extinguishment and a gain on extinguishment was recorded. The Company paid third party fees in connection with the transaction, which were capitalized as debt issuance costs. Unamortized debt issuance costs incurred in connection with securing the Company’s financing arrangements are presented in the consolidated balance sheets as a direct deduction from the carrying amount of the outstanding borrowings, consistent with debt discounts. All deferred financing costs are amortized to interest expense. The 2029 Notes include certain embedded features requiring bifurcation. The Company estimates the fair value of these features on a quarterly basis by assessing the likelihood of triggering events. The features do not have material values as of December 31, 2025 and 2024, but they may have value in the future, should the estimates change, with any change in fair value recorded in the Company’s consolidated statements of operations.
Warrants
The Company accounts for warrants as either stock-settled or cash-settled instruments based on an assessment of the specific terms of the warrants and applicable authoritative guidance in Financial Accounting Standards Board ASC 480, Distinguishing Liabilities from Equity and ASC 815-40, Contracts in Entity’s Own Equity. The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and meet all of the requirements for equity classification under ASC 815-40, including whether the warrants are indexed to the Company’s own stock and whether the events where holders of the warrants could potentially require net cash settlement are within the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance. Warrants that meet all of the criteria for equity classification are recorded as a component of additional paid-in capital at the time of issuance and are not remeasured. Warrants that do not meet the required criteria for equity classification are classified as liabilities. The Company adjusts such warrants to fair value at each reporting period until the warrants are exercised or expire.
The Warrants issued by the Company are classified as current liabilities in the consolidated balance sheets and recorded at their fair value. Changes in fair value are recorded in the Company’s consolidated statements of operations.Divestitures
The Company classifies long-lived assets and liabilities to be disposed of as held for sale in the period in which they are available for immediate sale in their present condition and the sale is probable and expected to be completed within one year. The Company initially measures assets and liabilities held for sale at the lower of their carrying value or fair value less costs to sell. When the divestiture represents a strategic shift that has (or will have) a major effect on the Company’s operations and financial results, the disposal is presented as a discontinued operation.
Fiscal 2024 Divestiture
In the second quarter of 2024, the Company completed the sale to a third party of 100% of the equity in its WildHealth reporting unit (“WildHealth”), which was created by the acquisition of WildHealth, Inc. in 2022. Pursuant to ASC Subtopic 205-20, Presentation of Financial Statements - Discontinued Operations, the divestiture did not meet the criteria for presentation as a discontinued operation. WildHealth was part of the Business segment and was a separate reporting unit. The transaction resulted in a loss of $0.6 million which was recognized and presented separately in Loss (gain) on divestiture on the Company’s consolidated statements of operations for the year ended December 31, 2024. Subsequent to the closing, the Company does not have ongoing involvement or arrangements with WildHealth.
Fiscal 2023 Divestiture
In the first quarter of 2023, the Company completed the sale of Kasamba, Inc. and Kasamba LTD (together, “Kasamba”) to Ingenio, LLC, for $16.9 million which was received in cash upon closing; and $2.6 million deferred payment to be received within a year of the close transaction date. Cash of $2.0 million was classified as Cash and cash equivalents on the consolidated balance sheet as of December 31, 2024 and was released in June 2024. The transaction resulted in a gain of $17.6 million, which was presented separately in Loss (gain) on divestiture on the Company’s consolidated statements of operations during the year ended December 31, 2023. During the year ended December 31, 2024, the Company recognized $1.8 million of post-closing adjustments pertaining to the final agreement amount which is recorded in General and administrative expenses in the consolidated statements of operations.
Advertising
The Company expenses the cost of advertising and promoting its services as incurred in Sales and marketing expense on the consolidated statements of operations. Such costs totaled $1.8 million, $5.1 million, and $10.9 million for the years ended December 31, 2025, 2024, and 2023, respectively.Research and Development
Research and development (“R&D”) costs are expensed when incurred, except for certain internal-use software development costs, which may be capitalized as noted above. R&D expenses consist primarily of personnel and related headcount costs, costs of professional services associated with the ongoing development of the Company’s technology, and allocated overhead, and are included in Product development in the consolidated statements of operations.
Stock-Based Compensation
Compensation related to stock-based awards to employees and directors is measured and recognized in the Company’s consolidated statements of operations based on the fair value of the awards granted. The Company estimates the fair value of its stock options using the Black Scholes option pricing model. The stock-based compensation expense relating to stock options is recognized on a straight-line basis over the period during which the employee or director is required to provide service in exchange for the award, usually the vesting period, which is generally one to four years.
Restricted stock units (“RSUs”) are generally subject to a service-based vesting condition over one to four years. The valuation of these RSUs is based solely on the Company’s stock price on the date of grant, and the corresponding compensation expense is amortized on a straight-line basis.
Performance-Vesting Restricted Stock Units (“PRSUs”) granted are generally subject to both a service-based vesting condition and a performance-based vesting condition. PRSUs will vest upon the achievement of specified performance targets and subject to continued service through the applicable vesting dates. The associated compensation cost is recognized over the requisite service period when it is probable that the performance condition will be satisfied.
In accordance with ASC 718-10, Compensation - Stock Compensation, the Company measures stock-based awards at fair value and recognizes compensation expense for all stock-based payment awards made to its employees and directors, including employee stock options. See Note 11 – Stockholders’ Equity for additional information.Leases
The Company has non-cancelable operating and finance leases for its corporate offices and other service agreements. Its leases have remaining lease terms of approximately 1 year, some of which include options to extend. The Company uses the non-cancelable lease term when recognizing the right-of-use (“ROU”) assets and lease liabilities, unless it is reasonably certain that a renewal or termination option will be exercised.
Lease costs were $9.4 million, $10.6 million and $15.3 million for the years ended December 31, 2025, 2024 and 2023, respectively. Weighted average remaining lease terms for operating leases were 1.1 years and 0.3 years as of December 31, 2025 and 2024, respectively, and for finance leases were 0.0 years and 0.8 years as of December 31, 2025 and 2024, respectively. The weighted average discount rates were 7% for operating and finance leases as of both December 31, 2025 and 2024.
Operating and finance ROU assets, and operating and finance lease liabilities were not material as of December 31, 2025 and 2024, and future minimum lease payments under non-cancelable operating and finance leases are not material.
Income Taxes
Income taxes are accounted for under the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in results of operations in the period that the tax change occurs. In evaluating the Company’s ability to recover its deferred tax assets in the jurisdiction from which they arise, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax-planning strategies, and results of recent operations. The Company includes interest accrued on the underpayment of income taxes and certain interest expense and penalties, if any, related to unrecognized tax benefits as a component of the income tax provision. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.
Comprehensive Loss
In accordance with ASC 220, Comprehensive Income, the Company reports by major components and as a single total, the change in its net assets during the period from non-owner sources. Comprehensive loss consists of net loss and accumulated other comprehensive loss, which includes certain changes in equity that are excluded from net loss. The Company’s comprehensive loss for all periods presented is related to the effect of foreign currency translation.
Recently Adopted Accounting Pronouncements
In December 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which modifies the rules on income tax disclosures to require entities to disclose (1) specific categories in the rate reconciliation, (2) the income or loss from continuing operations before income tax expense or benefit (separated between domestic and foreign) and (3) income tax expense or benefit from continuing operations (separated by federal, state and foreign). ASU 2023-09 also requires entities to disclose their income tax payments to international, federal, state and local jurisdictions, among other changes. The guidance is effective for annual periods beginning after December 15, 2024. The Company adopted this guidance in the fourth quarter of 2025 on a prospective basis, with disclosures related to the current year presented in accordance with the new standard. Adoption of the guidance did not have a material impact on the Company’s consolidated financial statements; however the disclosures in Note 14 - Income Taxes have been expanded.
Recently Issued Accounting Pronouncements
In December 2025, the FASB issued ASU 2025-12, Codification Improvements, which seeks to make incremental improvements to GAAP on a broad range of topics arising from technical corrections, unintended application of guidance, clarifications and other minor improvements. The guidance is effective for interim reporting periods within annual reporting periods beginning after December 15, 2026, with early adoption permitted, and can be applied on an issue-by-issue basis, prospectively or retrospectively. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.
In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270) - Narrow-Scope Improvements which improves the navigability of the required interim disclosures and clarifies when that guidance is applicable. The guidance is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted, and can be applied prospectively or retrospectively. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.
In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which removes all references to project stages related to internal-use software development. An entity is required to start capitalizing software costs when both of the following occur: (1) management has authorized and committed to funding the software project and (2) it is probable that the project will be completed and the software will be used to perform the function intended. The guidance is effective for annual periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.
In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Top 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provides all entities with a practical expedient when estimating expected credit losses for current accounts receivable and current contract assets arising from certain transactions. In developing reasonable and supportable forecasts as part of estimating expected credit losses, all entities may elect a practical expedient that assumes that current conditions as of the balance sheet date do not change for the remaining life of the asset. The guidance is effective for annual periods beginning after December 15, 2025, with early adoption permitted. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.
In November 2024, the FASB issued ASU 2024-04, Debt - Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments, which seeks to clarify the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. The amendments in this update are effective for annual periods beginning after December 15, 2025, and early adoption is permitted. ASU 2024-04 can be applied prospectively or retrospectively. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.
In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40), which seeks to expand disclosures about a public entity’s expenses, including more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation, amortization, and depletion) in commonly presented expense captions (such as cost of sales, sales and marketing, general and administrative, and research and development). The amendments in this update are effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. Early adoption is permitted for both interim and annual financial statements that have not yet been issued or made available for issuance. ASU 2024-03 should be applied retrospectively. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.
The Company’s revenue is generated from hosted service revenues, including platform access, usage and related professional services. Revenues are recognized when control of these services is transferred to the Company’s customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services.
The Company determines revenue recognition through the following steps:
•identification of the contract, or contracts, with a customer;
•identification of the performance obligations in the contract;
•determination of the transaction price;
•allocation of the transaction price to the performance obligations in the contract; and
•recognition of revenue when, or as, the Company satisfies a performance obligation.
Total revenue of $243.7 million, $312.5 million, and $402.0 million was recognized during the years ended December 31, 2025, 2024, and 2023, respectively. No single customer accounted for 10% or more of total revenue for the years ended December 31, 2025, 2024 and 2023.
None of the Company’s contracts contain a significant financing component.
Hosted Services Revenue
Hosted services revenue is reported at the amount that reflects the ultimate consideration expected to be received and primarily consists of fees that provide customers access to the LivePerson Platform, the Company’s enterprise-class digital customer conversation platform. The Company has determined such access represents a stand-ready service provided continually throughout the contract term. As such, control and satisfaction of this stand-ready performance obligation is deemed to occur over time. The Company recognizes this revenue over time on a ratable basis over the contract term, beginning on the date that access to the LivePerson Platform is made available to the customer. The passage of time is deemed to be the most faithful depiction of the transfer of control of the services as the customer simultaneously receives and consumes the benefit provided by the Company’s performance. Subscription contracts are generally one year or longer in length, billed monthly, quarterly or annually in advance.
Professional Services Revenue
Professional Services revenue is reported at the amount that reflects the ultimate consideration the Company expects to receive in exchange for such services. The Company’s professional services revenue consists of fees that provide customers with product support and updates during the term of the arrangement, which is typically one year or longer in length, billed monthly, quarterly, or annually in advance. Revenue is generally recognized ratably over the contract term. Professional services revenue also includes custom support services, which differ from standard product support. The professional services revenues are recognized as the services are completed.
Disaggregated Revenue
The following table presents the Company’s revenues disaggregated by revenue source:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Revenue: | |||||||||||||||||
Hosted services (1) | $ | 207,603 | $ | 261,682 | $ | 332,971 | |||||||||||
| Professional services | 36,139 | 50,792 | 69,012 | ||||||||||||||
| Total revenue | $ | 243,742 | $ | 312,474 | $ | 401,983 | |||||||||||
(1) On March 20, 2023, the Company completed the sale of Kasamba and therefore ceased recognizing revenue related to Kasamba effective on the transaction close date. This sale eliminated the entire Consumer segment, as a result of which revenue is presented within a single consolidated segment. Hosted services included $7.1 million for the year ended December 31, 2023 relating to Kasamba.
Remaining Performance Obligation
As of December 31, 2025, the aggregate amount of the transaction price allocated to remaining performance obligations was $175.6 million. Approximately 98% of the Company’s remaining performance obligations are expected to be recognized during the next 24 months, with the balance recognized thereafter. The disclosed amount represents contracted revenue that has not yet been recognized and does not include contract amounts that are cancelable by the customer, amounts associated with optional renewal periods, and amounts related to performance obligations that are billed and recognized as performed.
Contracts with Multiple Performance Obligations
Most of the Company’s contracts with customers contain multiple performance obligations. For these contracts, the Company accounts for individual performance obligations separately if they are distinct. The transaction price is allocated to the separate performance obligations on a relative standalone selling price (“SSP”) basis. Judgment is required to determine the SSP for each distinct performance obligation. The Company determines SSP based on observable prices at which the performance obligations are sold separately. When not directly observable, SSP is estimated using an adjusted market assessment approach, which considers market conditions and other entity-specific factors.
Revenue by Geographic Location
The Company is domiciled in the United States and has international operations around the globe. The following table presents the Company’s revenues attributable to operations by region for the periods presented:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
Americas (1) | $ | 134,431 | $ | 219,288 | $ | 286,924 | |||||||||||
EMEA (2) | 70,068 | 57,698 | 62,613 | ||||||||||||||
APAC (3) | 39,243 | 35,488 | 52,446 | ||||||||||||||
| Total revenue | $ | 243,742 | $ | 312,474 | $ | 401,983 | |||||||||||
——————————————
(1)United States, Canada, Latin America and South America (“Americas”).
(2)Europe, the Middle East and Africa (“EMEA”).
(3)Asia-Pacific (“APAC”).
Information about Contract Balances
The Company defers all incremental commission costs incurred to obtain the contract. These contract acquisition costs, which are comprised of sales commissions, have balances at December 31, 2025 and 2024 of $24.0 million and $33.6 million, respectively. The Company amortizes these costs over the related period of benefit using the customer expected life that the Company determined to be four years, which is consistent with the transfer to the customer of the services to which the asset relates. Commissions earned for renewal contracts are amortized over the contractual term of the renewals. The Company classifies contract acquisition costs as long-term.
The deferred revenue balance consists of services, which have been invoiced upfront, and are recognized as revenue only when the revenue recognition criteria are met.
In some arrangements, the Company allows customers to pay for access to the LivePerson Platform over the term of the software subscription. Amounts recognized as revenue in excess of amounts billed are recorded as unbilled receivables. Unbilled receivables, anticipated to be invoiced in the next twelve months, are included in Accounts receivable, net of allowances for credit losses on the consolidated balance sheets.
The Company recognized revenue of $57.9 million, $81.4 million and $86.8 million for the fiscal years ended December 31, 2025, 2024 and 2023, respectively, which was included in the corresponding deferred revenue balance at the beginning of the year.
The Company’s long-term deferred revenues are included in Other liabilities on the consolidated balance sheets. The opening and closing balances of the Company’s contract acquisition costs, net, and deferred revenues are as follows:
| Contract Acquisition Costs (Non-current) | Deferred Revenue (Current) | Deferred Revenue (Non-current) | ||||||||||||||||||||||||||||||||||||||||||
| (In thousands) | ||||||||||||||||||||||||||||||||||||||||||||
| Balance as of December 31, 2023 | $ | 37,354 | $ | 81,858 | $ | 183 | ||||||||||||||||||||||||||||||||||||||
| (Decrease) increase, net | (3,795) | (23,878) | 140 | |||||||||||||||||||||||||||||||||||||||||
| Balance as of December 31, 2024 | $ | 33,559 | $ | 57,980 | $ | 323 | ||||||||||||||||||||||||||||||||||||||
| Decrease, net | (9,608) | (3,685) | (233) | |||||||||||||||||||||||||||||||||||||||||
| Balance as of December 31, 2025 | $ | 23,951 | $ | 54,295 | $ | 90 | ||||||||||||||||||||||||||||||||||||||
The changes in deferred revenue during both periods presented were primarily driven by changes in customer renewal patterns and contract structures, including the timing of renewals and shifts in service commitments. Amortization expense in connection with contract acquisition cost was $17.3 million, $18.3 million and $27.6 million for the years ended December 31, 2025, 2024 and 2023, respectively, and was included in Sales and marketing expense in the consolidated statements of operations.
Accounts Receivable, Net
Accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for credit losses is the Company’s best estimate of the amount of expected credit losses in the Company’s existing accounts receivable, based on both specific and general reserves. The Company maintains general reserves on a collective basis by considering factors such as historical experience, creditworthiness, the age of the trade receivable balances, and current economic conditions. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance sheet credit exposure related to its customers. The activity in the allowance for credit losses as of the dates presented is as follows:
| December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| (In thousands) | ||||||||||||||||||||
| Balance, beginning of year | $ | 8,627 | $ | 9,290 | $ | 9,239 | ||||||||||||||
| Additions charged to costs and expenses | 866 | 14,959 | 3,319 | |||||||||||||||||
| Deductions/write-offs | (5,042) | (15,622) | (3,268) | |||||||||||||||||
| Balance, end of year | $ | 4,451 | $ | 8,627 | $ | 9,290 | ||||||||||||||
The following table presents the Company’s revenues disaggregated by revenue source:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Revenue: | |||||||||||||||||
Hosted services (1) | $ | 207,603 | $ | 261,682 | $ | 332,971 | |||||||||||
| Professional services | 36,139 | 50,792 | 69,012 | ||||||||||||||
| Total revenue | $ | 243,742 | $ | 312,474 | $ | 401,983 | |||||||||||
(1) On March 20, 2023, the Company completed the sale of Kasamba and therefore ceased recognizing revenue related to Kasamba effective on the transaction close date. This sale eliminated the entire Consumer segment, as a result of which revenue is presented within a single consolidated segment. Hosted services included $7.1 million for the year ended December 31, 2023 relating to Kasamba.
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
Americas (1) | $ | 134,431 | $ | 219,288 | $ | 286,924 | |||||||||||
EMEA (2) | 70,068 | 57,698 | 62,613 | ||||||||||||||
APAC (3) | 39,243 | 35,488 | 52,446 | ||||||||||||||
| Total revenue | $ | 243,742 | $ | 312,474 | $ | 401,983 | |||||||||||
——————————————
(1)United States, Canada, Latin America and South America (“Americas”).
(2)Europe, the Middle East and Africa (“EMEA”).
(3)Asia-Pacific (“APAC”).
| Contract Acquisition Costs (Non-current) | Deferred Revenue (Current) | Deferred Revenue (Non-current) | ||||||||||||||||||||||||||||||||||||||||||
| (In thousands) | ||||||||||||||||||||||||||||||||||||||||||||
| Balance as of December 31, 2023 | $ | 37,354 | $ | 81,858 | $ | 183 | ||||||||||||||||||||||||||||||||||||||
| (Decrease) increase, net | (3,795) | (23,878) | 140 | |||||||||||||||||||||||||||||||||||||||||
| Balance as of December 31, 2024 | $ | 33,559 | $ | 57,980 | $ | 323 | ||||||||||||||||||||||||||||||||||||||
| Decrease, net | (9,608) | (3,685) | (233) | |||||||||||||||||||||||||||||||||||||||||
| Balance as of December 31, 2025 | $ | 23,951 | $ | 54,295 | $ | 90 | ||||||||||||||||||||||||||||||||||||||
| December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| (In thousands) | ||||||||||||||||||||
| Balance, beginning of year | $ | 8,627 | $ | 9,290 | $ | 9,239 | ||||||||||||||
| Additions charged to costs and expenses | 866 | 14,959 | 3,319 | |||||||||||||||||
| Deductions/write-offs | (5,042) | (15,622) | (3,268) | |||||||||||||||||
| Balance, end of year | $ | 4,451 | $ | 8,627 | $ | 9,290 | ||||||||||||||
Basic net loss per share is computed by dividing net loss by the weighted-average number of shares of common stock outstanding during the period.
Diluted net loss per share is computed by giving effect to all potentially dilutive common stock equivalents outstanding for the period. For diluted net loss per share, the numerator is decreased to reverse the gain on troubled debt restructuring associated with the exchange transaction of the 0% Convertible Senior Notes due 2026 (the “2026 Notes”) and the denominator is increased to include the number of the shares issuable upon the conversion of the 2026 Notes. For purposes of this calculation, stock options, restricted stock units, 0.750% Convertible Senior Notes due 2024 (the “2024 Notes”), and 0% Convertible Senior Notes due 2026 (the “2026 Notes”) are considered to be common stock equivalents but are excluded from the calculation of diluted net loss per share when including them has an anti-dilutive effect.
The share-settled warrants and cash-settled warrants are not participating securities. As the average market price of the Company’s common stock over the year ended December 31, 2025 exceeds the warrants’ exercise price, the share-settled warrants are included in diluted EPS. For diluted net loss per share, the numerator is adjusted for any changes in fair value and the denominator is increased to include the number of potential exercise of warrants. The cash-settled warrants are not included in the calculation of diluted EPS due to the cash-settlement requirement.
The Company uses the treasury stock method for stock options, restricted stock units, and share-settled warrants, and uses the if-converted method for convertible debt. As the average market price of the Company’s common stock is below the conversion price of the Company’s 2024 Notes, the impact of conversion is anti-dilutive. See Note 8 – Senior Notes, Capped Call Transactions, Warrants and Preferred Stock for additional information about the 2024 Notes, 2026 Notes, 2029 Notes, and Second Lien Senior Subordinated Secured Notes due 2029 (the “Second Lien Notes”) and together with the 2024 Notes, the 2026 Notes, and the 2029 Notes, the “Notes”).
Reconciliation of shares used in calculating basic and diluted net loss per share for the years ended December 31, 2025, 2024, and 2023, were as follows:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands, except number of shares and per share amounts) | |||||||||||||||||
| Numerator: | |||||||||||||||||
| Net loss | $ | (67,233) | $ | (134,273) | $ | (100,435) | |||||||||||
| Gain on troubled debt restructuring, net of amortization | (26,670) | — | — | ||||||||||||||
| Gain on change in fair value of share-settled warrants | (13,184) | — | — | ||||||||||||||
| Net loss available to shareholders for diluted net loss per share | $ | (107,087) | $ | (134,273) | $ | (100,435) | |||||||||||
| Denominator: | |||||||||||||||||
| Weighted average number of shares outstanding used to compute basic net loss per share | 7,843,700 | 5,914,344 | 5,239,552 | ||||||||||||||
| Conversion option of the 2026 Notes | 228,932 | — | — | ||||||||||||||
| Impact of potential exercise of warrants | 568,098 | — | — | ||||||||||||||
| Weighted average number of shares outstanding used to compute diluted net loss per share | 8,640,730 | 5,914,344 | 5,239,552 | ||||||||||||||
| Net loss per share, basic | $ | (8.57) | $ | (22.70) | $ | (19.17) | |||||||||||
| Net loss per share, diluted | $ | (12.39) | $ | (22.70) | $ | (19.17) | |||||||||||
The securities listed below were excluded from the computation of diluted net loss per share for all periods presented, as their effect would have been anti-dilutive:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Shares subject to outstanding common stock options and ESPP | 186,369 | 180,824 | 212,422 | ||||||||||||||
| Restricted stock units | 819,875 | 834,792 | 337,603 | ||||||||||||||
| Convertible preferred stock | 110,257 | — | — | ||||||||||||||
| Conversion option of the 2024 Notes | — | 20,245 | 125,257 | ||||||||||||||
| Conversion option of the 2026 Notes | — | 378,773 | 458,619 | ||||||||||||||
| Share-settled warrants | — | 705,412 | — | ||||||||||||||
| Total | 1,116,501 | 2,120,046 | 1,133,901 | ||||||||||||||
Reconciliation of shares used in calculating basic and diluted net loss per share for the years ended December 31, 2025, 2024, and 2023, were as follows:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands, except number of shares and per share amounts) | |||||||||||||||||
| Numerator: | |||||||||||||||||
| Net loss | $ | (67,233) | $ | (134,273) | $ | (100,435) | |||||||||||
| Gain on troubled debt restructuring, net of amortization | (26,670) | — | — | ||||||||||||||
| Gain on change in fair value of share-settled warrants | (13,184) | — | — | ||||||||||||||
| Net loss available to shareholders for diluted net loss per share | $ | (107,087) | $ | (134,273) | $ | (100,435) | |||||||||||
| Denominator: | |||||||||||||||||
| Weighted average number of shares outstanding used to compute basic net loss per share | 7,843,700 | 5,914,344 | 5,239,552 | ||||||||||||||
| Conversion option of the 2026 Notes | 228,932 | — | — | ||||||||||||||
| Impact of potential exercise of warrants | 568,098 | — | — | ||||||||||||||
| Weighted average number of shares outstanding used to compute diluted net loss per share | 8,640,730 | 5,914,344 | 5,239,552 | ||||||||||||||
| Net loss per share, basic | $ | (8.57) | $ | (22.70) | $ | (19.17) | |||||||||||
| Net loss per share, diluted | $ | (12.39) | $ | (22.70) | $ | (19.17) | |||||||||||
The securities listed below were excluded from the computation of diluted net loss per share for all periods presented, as their effect would have been anti-dilutive:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Shares subject to outstanding common stock options and ESPP | 186,369 | 180,824 | 212,422 | ||||||||||||||
| Restricted stock units | 819,875 | 834,792 | 337,603 | ||||||||||||||
| Convertible preferred stock | 110,257 | — | — | ||||||||||||||
| Conversion option of the 2024 Notes | — | 20,245 | 125,257 | ||||||||||||||
| Conversion option of the 2026 Notes | — | 378,773 | 458,619 | ||||||||||||||
| Share-settled warrants | — | 705,412 | — | ||||||||||||||
| Total | 1,116,501 | 2,120,046 | 1,133,901 | ||||||||||||||
The Company accounts for its segment information in accordance with the provisions of ASC 280-10, Segment Reporting. ASC 280-10 establishes annual and interim reporting standards for operating segments of a company. ASC 280-10 requires disclosures of selected segment-related financial information about products, major customers, and geographic areas based on the Company’s internal accounting methods. The chief operating decision maker (“CODM”), who is the Company’s Chief Executive Officer, evaluates performance, makes operating decisions, and allocates resources based on the financial information presented on a consolidated basis using net loss. Expenses are reviewed by the nature of the cost (Cost of revenue, Sales and marketing, General and administrative and Product development), consistent with the Company’s presentation on its consolidated statements of operations. There are no segment managers who are held accountable by the CODM, or anyone else, for operations, operating results and planning for levels or components below the consolidated unit level. Accordingly, management has determined that the Company operates as one operating and reportable segment. The Company identifies net loss as its required measure of segment operating profit or loss. Significant expenses within loss from operations, as well as within net loss are separately presented on the Company’s consolidated statements of operations. Other segment items within net loss include Interest expense, Interest income, Gain on troubled debt restructuring, Gain on debt extinguishment, Other income (expense), net, and Provision for income taxes.
Geographic Information
The following table presents the Company’s long-lived assets by geographic region as of the dates set forth below:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (In thousands) | |||||||||||
| United States | $ | 266,695 | $ | 316,975 | |||||||
| Germany | 26,147 | 29,925 | |||||||||
| Australia | 9,721 | 10,830 | |||||||||
| Netherlands | 4,678 | 5,036 | |||||||||
Other (1) | 10,308 | 13,788 | |||||||||
| Total long-lived assets | $ | 317,549 | $ | 376,554 | |||||||
——————————————
(1)Israel, United Kingdom, Japan, France, Italy, Spain, Canada, and Singapore.
The following table presents the Company’s long-lived assets by geographic region as of the dates set forth below:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (In thousands) | |||||||||||
| United States | $ | 266,695 | $ | 316,975 | |||||||
| Germany | 26,147 | 29,925 | |||||||||
| Australia | 9,721 | 10,830 | |||||||||
| Netherlands | 4,678 | 5,036 | |||||||||
Other (1) | 10,308 | 13,788 | |||||||||
| Total long-lived assets | $ | 317,549 | $ | 376,554 | |||||||
——————————————
(1)Israel, United Kingdom, Japan, France, Italy, Spain, Canada, and Singapore.
Goodwill
Goodwill represents the excess of the aggregate purchase price over the fair value of net identifiable assets acquired in a business combination. The Company evaluates goodwill for impairment on an annual basis, and more frequently whenever events or substantive changes in circumstances indicate that it is more likely than not that the carrying value of a reporting unit exceeds its fair value. Assumptions used in an impairment test require significant judgment, therefore, they are subject to change based on facts and circumstances present at each date goodwill is evaluated for impairment.
In connection with the annual impairment test completed as of October 1, 2025, using the quantitative “Step 1” assessment, the Company determined the fair value of its reporting unit using both an income approach and a market approach. The Company applied an equal weighting to the value conclusions resulting from the two employed approaches, because there was sufficient information to estimate the fair value of the reporting unit under both methods. The estimated fair value of the reporting unit is a Level 3 measure in the fair value hierarchy. The fair value determination using an income approach requires management to make significant estimates and assumptions related to forecasts of future revenues, earnings before interest, taxes, depreciation, and amortization (EBITDA) and the discount rate. The Company’s projections were used as a key input into the annual goodwill impairment test performed. The discount rate used in the income approach model was 12.5%. The fair value determination using a market approach requires management to make significant assumptions related to marketplace multiples from within a peer public company group. As a result of the October 1, 2025 impairment test, no impairment was identified, as the fair value of the Company’s reporting unit exceeded its carrying value.
During the fourth quarter of 2025, the Company performed its quarterly triggering event assessment and concluded that a triggering event was present due to the decrease in the stock price. As a result, the Company performed an interim impairment test as of December 31, 2025 using the quantitative “Step 1” assessment. The Company determined the fair value of its reporting unit using both an income approach and a market approach. The Company applied an equal weighting to the value conclusions resulting from the two employed approaches, because there was sufficient information to estimate the fair value of the reporting unit under both methods. The estimated fair value of the reporting unit is a Level 3 measure in the fair value hierarchy. The fair value determination using an income approach requires management to make significant estimates and assumptions related to forecasts of future revenues, EBITDA and the discount rate. The Company’s projections were used as a key input into the goodwill impairment test performed. The discount rate used in the income approach model was 13.5%, which included a 1% risk premium. The fair value determination using a market approach requires management to make significant assumptions related to marketplace multiples from within a peer public company group. As a result of this impairment test, the Company recorded a non-cash impairment charge of $41.6 million in the consolidated statements of operations during the year ended December 31, 2025, to recognize the impairment of goodwill in the Company’s one reporting unit.
If, in future periods, the financial performance of the reporting unit does not meet expectations, or a prolonged decline occurs in the market place of our common stock, it may cause a material change in the results of the impairment assessment and result in future impairment to goodwill.
The changes in the carrying amount of goodwill for the years ended December 31, 2025 and 2024 are as follows:
| Goodwill, net | |||||
| (In thousands) | |||||
Balance as of December 31, 2023 (1) | $ | 285,631 | |||
| Goodwill impairment | (60,551) | ||||
| Foreign exchange adjustment | (2,526) | ||||
Balance as of December 31, 2024 (1) | 222,554 | ||||
| Goodwill impairment | (41,595) | ||||
| Foreign exchange adjustment | 3,943 | ||||
Balance as of December 31, 2025 (1) | $ | 184,902 | |||
(1) The accumulated impairment balance was $11.9 million, $72.4 million and $114.0 million as of December 31, 2023, 2024 and 2025, respectively.
In connection with the annual impairment test completed on October 1, 2024, using the quantitative “Step 1” assessment, the Company determined the fair value of its reporting unit using both an income approach and a market approach. The Company applied an equal weighting to the value conclusions resulting from the two employed approaches, because there was sufficient information to estimate the fair value of the reporting unit under both methods. The estimated fair value of the reporting unit is a Level 3 measure in the fair value hierarchy. The fair value determination using an income approach requires management to make significant estimates and assumptions related to forecasts of future revenues, EBITDA and the discount rate. The discount rate used in the income approach model was 13%. The fair value determination using a market approach requires management to make significant assumptions related to marketplace multiples from within a peer public company group. In connection with the Company’s annual budget process in the fourth quarter of 2024, management completed a comprehensive review of the Company’s operations, which resulted in reduced estimated future cash flows. The revised projections were used as a key input into the annual goodwill impairment test performed in the fourth quarter of 2024. As a result, the Company recorded a non-cash impairment charge of $56.9 million in the consolidated statements of operations during the year ended December 31, 2024, to recognize the impairment of goodwill in the Company’s one reporting unit.
In addition, during the first quarter of 2024, the Company recorded a non-cash impairment charge of $3.6 million in the consolidated statements of operations, to recognize a full impairment of goodwill associated with its WildHealth reporting unit, which was sold during the second quarter of fiscal 2024.
Intangible Assets, Net
Patents
Legal costs incurred to establish patents are capitalized. When patents are issued, capitalized costs are amortized on the straight-line method over the related patent term. We review our patent portfolio on a periodic basis to determine whether events and circumstances would indicate impairment. In the event a patent is abandoned, the net book value of the patent is written off.
In connection with the Company’s review process in the fourth quarter of 2025, management completed a comprehensive review of the Company operations and decided to cease pursuit of a portion of its pending patents. As a result, the Company recorded a non-cash impairment charge of $2.1 million, which was classified as Impairment of intangibles and other assets in the consolidated statements of operations during the year ended December 31, 2025.
The changes in the carrying amount of intangible assets, net for the years ended December 31, 2025 and 2024 are as follows:
| December 31, 2025 | December 31, 2024 | ||||||||||
| (In thousands) | |||||||||||
| Patents: | |||||||||||
| Gross carrying amount | $ | 16,639 | $ | 17,609 | |||||||
| Accumulated amortization | (3,230) | (2,539) | |||||||||
| Net carrying amount | $ | 13,409 | $ | 15,070 | |||||||
| Weighted average amortization period | 11.0 years | 12.7 years | |||||||||
Amortization expense is recognized over the estimated useful life of the asset. Aggregate amortization expense for intangible assets and finance leases, net was $0.7 million, $12.0 million, and $22.2 million for the years ended December 31, 2025, 2024, and 2023, respectively.
As a result of the impairment test in 2024, the Company recognized a non-cash impairment charge of $35.2 million included in Impairment of intangibles and other assets in the consolidated statements of operations. The fair value was determined using a combination of income and market approach. This non-cash charge resulted in a full impairment of the following intangible assets acquired in connection with historical business combination transactions: developed technology in the amount of $23.7 million, customer relationships in the amount of $11.0 million and trademarks in the amount of $0.5 million.
During the first quarter of 2024, the Company recognized a non-cash impairment charge related to WildHealth of $2.2 million included in Impairment of intangibles and other assets in the consolidated statements of operations.
During the year ended December 31, 2023, the Company recognized a non-cash impairment charge of $3.0 million included in Impairment of intangibles and other assets in the consolidated statements of operations related to developed technology associated with WildHealth.
As of December 31, 2025, estimated annual amortization expense for the next five years and thereafter is as follows:
| Estimated Amortization Expense | |||||
| (In thousands) | |||||
| 2026 | $ | 654 | |||
| 2027 | 618 | ||||
| 2028 | 611 | ||||
| 2029 | 595 | ||||
| 2030 | 573 | ||||
| Thereafter | 10,358 | ||||
| Total | $ | 13,409 | |||
The changes in the carrying amount of goodwill for the years ended December 31, 2025 and 2024 are as follows:
| Goodwill, net | |||||
| (In thousands) | |||||
Balance as of December 31, 2023 (1) | $ | 285,631 | |||
| Goodwill impairment | (60,551) | ||||
| Foreign exchange adjustment | (2,526) | ||||
Balance as of December 31, 2024 (1) | 222,554 | ||||
| Goodwill impairment | (41,595) | ||||
| Foreign exchange adjustment | 3,943 | ||||
Balance as of December 31, 2025 (1) | $ | 184,902 | |||
(1) The accumulated impairment balance was $11.9 million, $72.4 million and $114.0 million as of December 31, 2023, 2024 and 2025, respectively.
| December 31, 2025 | December 31, 2024 | ||||||||||
| (In thousands) | |||||||||||
| Patents: | |||||||||||
| Gross carrying amount | $ | 16,639 | $ | 17,609 | |||||||
| Accumulated amortization | (3,230) | (2,539) | |||||||||
| Net carrying amount | $ | 13,409 | $ | 15,070 | |||||||
| Weighted average amortization period | 11.0 years | 12.7 years | |||||||||
As of December 31, 2025, estimated annual amortization expense for the next five years and thereafter is as follows:
| Estimated Amortization Expense | |||||
| (In thousands) | |||||
| 2026 | $ | 654 | |||
| 2027 | 618 | ||||
| 2028 | 611 | ||||
| 2029 | 595 | ||||
| 2030 | 573 | ||||
| Thereafter | 10,358 | ||||
| Total | $ | 13,409 | |||
The following table presents the detail of property and equipment, net as of the dates presented:
| December 31, | |||||||||||||||||
| Useful Life (Years) | 2025 | 2024 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Computer equipment and software | 3 to 5 | $ | 133,858 | $ | 134,647 | ||||||||||||
| Internal-use software development costs | 5 | 187,470 | 176,725 | ||||||||||||||
| Finance lease right-of-use assets | 2 | — | 62 | ||||||||||||||
| Furniture, equipment and building improvements | The lesser of 5 or estimated useful life | 333 | 234 | ||||||||||||||
| Property and equipment, at cost | 321,661 | 311,668 | |||||||||||||||
| Less: accumulated depreciation and amortization | (231,272) | (211,111) | |||||||||||||||
| Total Property and equipment, net | $ | 90,389 | $ | 100,557 | |||||||||||||
There were no impairment charges related to property and equipment during the year ended December 31, 2025. The Company recorded non-cash impairment charges of $9.5 million and $5.0 million related to internal-use software development costs during the years ended December 31, 2024 and 2023, respectively. The impairment charges were included in Impairment of intangibles and other assets in the consolidated statements of operations for the years ended December 31, 2024 and 2023 and pertained to internal-use software that was discontinued and had no future economic benefit.
Expenditures for routine maintenance and repairs are charged to operating expense as incurred. Major renewals and improvements are capitalized and depreciated over their estimated useful lives. The following table presents total depreciation and amortization included in the consolidated statements of operations for the periods presented:
| Year ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Cost of revenue | $ | 5,377 | $ | 6,792 | $ | 8,072 | |||||||||||
| Sales and marketing | 2,423 | 3,138 | 3,103 | ||||||||||||||
| General and administrative | 235 | 247 | 453 | ||||||||||||||
| Product development | 13,940 | 20,133 | 20,929 | ||||||||||||||
| Total depreciation and amortization | $ | 21,975 | $ | 30,310 | $ | 32,557 | |||||||||||
The following table presents the detail of property and equipment, net as of the dates presented:
| December 31, | |||||||||||||||||
| Useful Life (Years) | 2025 | 2024 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Computer equipment and software | 3 to 5 | $ | 133,858 | $ | 134,647 | ||||||||||||
| Internal-use software development costs | 5 | 187,470 | 176,725 | ||||||||||||||
| Finance lease right-of-use assets | 2 | — | 62 | ||||||||||||||
| Furniture, equipment and building improvements | The lesser of 5 or estimated useful life | 333 | 234 | ||||||||||||||
| Property and equipment, at cost | 321,661 | 311,668 | |||||||||||||||
| Less: accumulated depreciation and amortization | (231,272) | (211,111) | |||||||||||||||
| Total Property and equipment, net | $ | 90,389 | $ | 100,557 | |||||||||||||
The following table presents the detail of accrued expenses and other current liabilities as of the dates presented:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (In thousands) | |||||||||||
| Professional services and consulting and other vendor fees | $ | 17,404 | $ | 30,302 | |||||||
| Payroll and other employee-related costs | 7,735 | 10,061 | |||||||||
| Warrants liability (Note 9) | 2,999 | 17,498 | |||||||||
| Accrued interest | 1,122 | 998 | |||||||||
| Restructuring (Note 12) | 1,387 | 3,028 | |||||||||
| Sales commissions | 1,787 | 2,207 | |||||||||
| Non-income tax | 280 | 644 | |||||||||
| Other | 5,986 | 1,844 | |||||||||
| Total accrued expenses and other current liabilities | $ | 38,700 | $ | 66,582 | |||||||
The following table presents the detail of accrued expenses and other current liabilities as of the dates presented:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (In thousands) | |||||||||||
| Professional services and consulting and other vendor fees | $ | 17,404 | $ | 30,302 | |||||||
| Payroll and other employee-related costs | 7,735 | 10,061 | |||||||||
| Warrants liability (Note 9) | 2,999 | 17,498 | |||||||||
| Accrued interest | 1,122 | 998 | |||||||||
| Restructuring (Note 12) | 1,387 | 3,028 | |||||||||
| Sales commissions | 1,787 | 2,207 | |||||||||
| Non-income tax | 280 | 644 | |||||||||
| Other | 5,986 | 1,844 | |||||||||
| Total accrued expenses and other current liabilities | $ | 38,700 | $ | 66,582 | |||||||
Convertible Senior Notes due 2024 and Capped Calls
In March 2019, the Company issued $230.0 million aggregate principal amount of its 0.750% Convertible Senior Notes due 2024 in a private placement. Interest on the 2024 Notes was payable semi-annually in arrears on March 1 and September 1 of each year.
On March 21, 2023, the Company entered into individual privately negotiated transactions (the “Note Repurchase Agreements”) with certain holders of its 2024 Notes, pursuant to which the Company agreed to pay an aggregate of $149.7 million in cash for the repurchase of $157.5 million in aggregate principal amount of the 2024 Notes (the “Note Repurchases”). During the year ended December 31, 2023, the Company recognized a $7.2 million gain, net of transaction costs of $0.5 million on debt extinguishment, which represented the difference between the carrying value and the fair value of the 2024 Notes just prior to the Note Repurchases, which was recorded in Gain on debt extinguishment in the consolidated statements of operations.
Upon completion of the Note Repurchases, the aggregate principal amount of the 2024 Notes was reduced by $157.5 million to $72.5 million and the carrying amount of the 2024 Notes reduced by $228.3 million to $72.0 million. A corresponding portion of the 2024 capped calls were terminated in connection following the Note Repurchases as required by their terms for minimal consideration.
The remaining 2024 Notes matured on March 1, 2024, on which date the Company repaid in full the outstanding $72.5 million in aggregate principal amount and the associated 2024 capped calls expired unexercised.
Convertible Senior Notes due 2026 and Capped Calls
In December 2020, the Company issued $517.5 million aggregate principal amount of its 2026 Notes in a private placement, of which $20.1 million aggregate principal amount was outstanding as of December 31, 2025 and are senior unsecured obligations of the Company. The 2026 Notes will mature on December 15, 2026, unless earlier repurchased or redeemed by the Company or converted pursuant to their terms. The total net proceeds from the offering of the 2026 Notes, after deducting debt issuance costs, was $505.3 million.
Each $1,000 in principal amount of the 2026 Notes is convertible into 0.8862 shares of the Company’s common stock, which is equivalent to a conversion price of $1,128.39 per share. The conversion rate is subject to adjustment upon the occurrence of certain specified events but will not be adjusted for any accrued and unpaid special interest. In addition, following certain corporate events that occur prior to the maturity date, the Company will increase the conversion rate for a holder who elects to convert its 2026 Notes in connection with such a corporate event. The 2026 Notes are not redeemable prior to the maturity date of the 2026 Notes and no sinking fund is provided for the 2026 Notes. The indenture governing the 2026 Notes contains events of default customary for convertible notes issued in connection with similar transactions. If the Company undergoes a “Fundamental Change” (as defined in the indenture governing the 2026 Notes) which includes a change of control or the failure of the Company’s common stock to be listed or quoted on any of The Nasdaq Global Select Market, The Nasdaq Global Market or the New York Stock Exchange, holders may require the Company to repurchase for cash all or any portion of their 2026 Notes in principal amounts of $1,000 or a multiple thereof at a Fundamental Change repurchase price equal to 100% of the principal amount of the 2026 Notes to be repurchased, plus accrued and unpaid special interest to, but excluding, the Fundamental Change repurchase date.
Holders of the 2026 Notes may convert their 2026 Notes at their option at any time prior to the close of business on the business day immediately preceding August 15, 2026, in multiples of $1,000 principal amount, only under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on March 31, 2021 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price for the 2026 Notes on each applicable trading day as determined by the Company; (2) during the five business day period after any five consecutive trading day period (the “2026 Notes measurement period”) in which the “trading price” (as defined in the indenture governing the 2026 Notes) per $1,000 principal amount of 2026 Notes for each trading day of the 2026 Notes measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate for the 2026 Notes on each such trading day; (3) with respect to any 2026 Notes that the Company calls for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate events. On or after August 15, 2026, holders may convert all or any portion of their 2026 Notes at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date, regardless of the foregoing circumstances. Upon conversion, the Company will pay or deliver, as the case may be, cash, shares of its common stock or a combination of cash and shares of its common stock, at the Company’s election.
During the year ended December 31, 2025, the conditions allowing holders of the 2026 Notes to convert were not met.
In connection with the offering of the 2026 Notes, the Company entered into privately-negotiated capped call option transactions with certain counterparties (the “2026 capped calls”). The 2026 capped calls each have a strike price of $1,128.39 per share, subject to certain adjustments, which corresponds to the conversion price of the 2026 Notes. The 2026 capped calls have initial cap prices of $1,583.70 per share, subject to certain adjustment events. The 2026 capped calls cover, subject to anti-dilution adjustments, approximately 0.11 million shares of common stock. The 2026 capped calls are generally intended to reduce or offset the potential dilution to the common stock upon any conversion of the 2026 Notes with such reduction or offset, as the case may be, subject to a cap based on the cap price. The 2026 capped calls expire on December 15, 2026, subject to earlier exercise. The 2026 capped calls are subject to either adjustment or termination upon the occurrence of specified extraordinary events affecting the Company, including a merger event, a tender offer, and a nationalization, insolvency or delisting involving the Company. In addition, the 2026 capped calls are subject to certain specified additional disruption events that may give rise to a termination of the 2026 capped calls, including changes in law, failure to deliver, and hedging disruptions. The 2026 capped calls are recorded in stockholders’ equity and are not accounted for as derivatives. The net cost of $46.1 million incurred to purchase the 2026 capped calls was recorded as a reduction to additional paid-in capital in the accompanying consolidated balance sheets.
Pursuant to a privately negotiated exchange and purchase agreement (the “Exchange and Purchase Agreement”), on June 3, 2024, the Company exchanged $146.0 million principal amount of the 2026 Notes then held by an investor for $100.0 million principal amount of new 2029 Notes, and the same investor purchased an additional $50.0 million principal amount of the 2029 Notes for cash. In connection with the exchange and purchase, the Company also issued the Warrants to the investor, and the investor agreed to purchase up to $50.0 million of additional 2029 Notes upon the Company’s request and subject to certain conditions (the “Delayed Draw Notes”). As a result of the exchange and purchase transactions, during the second quarter of 2024, the Company recognized a $68.1 million gain on debt extinguishment which represented the difference between the carrying value of the 2026 Notes so exchanged and the collective fair value of the 2029 Notes and the Warrants, net of the cash payment received from the investor. The extinguishment gain was recorded in Gain on debt extinguishment in the consolidated statements of operations in fiscal 2024, and a corresponding portion of capped calls were terminated following the exchange and purchase as required by their terms for minimal consideration.
On June 13, 2024, the Company repurchased $10.3 million principal amount of the 2026 Notes for $4.9 million in cash. As a result of the transaction, during the second quarter of 2024, the Company recognized a $5.0 million gain on debt extinguishment, which was recorded in Gain on debt extinguishment in the consolidated statements of operations. In addition, a corresponding portion of the 2026 capped calls were terminated following the repurchase as required by their terms for no consideration.
The 2026 Notes were classified as long-term liabilities in the consolidated balance sheets as of December 31, 2024. After the completion of the exchange and repurchase, the aggregate principal amount of the 2026 Notes was reduced to $361.2 million and the carrying amount of the 2026 Notes was reduced to $357.8 million. A corresponding portion of the 2026 capped calls were terminated in connection following the transactions as required by their terms for no consideration.
September 2025 Debt Exchange
On September 12, 2025 (the “Exchange Closing Date”), the Company consummated an exchange of the $341.1 million in aggregate principal amount of 2026 Notes held by certain former holders of the Company’s outstanding 2026 Notes (the “Noteholders”) for (i) an aggregate payment of $45.0 million in cash, (ii) $115.0 million in aggregate principal amount of the Company’s 10.0% Second Lien Senior Subordinated Secured Notes due 2029 (the “Second Lien Notes”), (iii) 3,555,596 shares of common stock and (iv) 26,551 shares of Series B Fixed Rate Convertible Perpetual Preferred Stock, par value $0.001 (the “Series B Preferred Stock”). On September 25, 2025, the Company issued an additional 143,192 shares of common stock to certain of the Noteholders, which shares were issued on a deferred basis due to a beneficial ownership limitation preventing such Noteholders from owning in excess of 9.90% of the outstanding common stock of the Company. In addition, a corresponding portion of the 2026 capped calls were terminated following the exchange as required by their terms for no consideration. This September 2025 Debt Exchange was accounted for as a Troubled Debt Restructuring (“TDR”) in accordance with ASC 470-60, Troubled Debt Restructuring by Debtors. The Company recognized a TDR gain of $27.7 million, which is presented as Gain on troubled debt restructuring in the consolidated statements of operations for the year ended December 31, 2025.
On the Exchange Closing Date, the principal amount of the exchanged 2026 Notes was $341.1 million with a discount of $1.7 million for a net carrying value of $339.4 million. The Company recognized the Second Lien Notes at a carrying value of $182.0 million. Under the TDR accounting treatment, the carrying value of the Second Lien Notes of $182.0 million was comprised of the total future undiscounted cash flows which included principal of $115.0 million, the maximum interest of $58.7 million as well as a redemption premium of $8.3 million. The redemption premium is related to the contingent redemption feature where the lenders can redeem the Second Lien Notes immediately prior to their maturity upon the occurrence of a Fundamental Change as defined in the indenture governing the Second Lien Notes at 105% of the principal plus accrued but unpaid interest as discussed further below. The Company assumes contingent future payments will have to be paid and those amounts shall be included in the total future cash payments. If, in future periods, the contingency is resolved so that a contingent payment does not have to be made, the Company will recognize a gain in the period when the contingency has been resolved. Subsequently, no interest expense on the Second Lien Notes will be recorded, as all future interest payments will reduce the carrying value of the restructured debt.
The unexchanged 2026 Notes, due December 15, 2026, are classified as Current portion of long-term debt in the consolidated balance sheets as of December 31, 2025. The aggregate principal amount of the unexchanged 2026 Notes was $20.1 million and the carrying amount of the unexchanged 2026 Notes was $20.0 million as of December 31, 2025. The remaining term over which the unexchanged 2026 Notes’ debt issuance costs will be amortized is 0.92 years at an effective interest rate of 0.40%.
Second Lien Senior Subordinated Secured Notes due 2029
On the Exchange Closing Date, the Company issued $115.0 million in aggregate principal amount of Second Lien Notes as part of the September 2025 Debt Exchange transaction. The Second Lien Notes accrue interest at a rate of 10.0% per annum. Prior to March 15, 2027, all of the interest on the Second Lien Notes is payable in-kind (“PIK”). On and after March 15, 2027 and until June 15, 2028, interest will be payable, at the Company’s option, in cash or in-kind or partially in cash and partially in-kind. On and after June 15, 2028, until the maturity of the Second Lien Notes, interest on the Second Lien Notes will be payable in cash, or at the Company’s option, up to 6.0% per annum in-kind. Unless earlier repurchased or redeemed by the Company, the Second Lien Notes will mature on December 15, 2029.
The Company may, at its option, redeem the Second Lien Notes, in whole or in part, prior to September 12, 2026 at a price equal to the sum of (i) 105% of the accrued and unpaid interest (including cash and PIK components thereof), (ii) 105% of the aggregate principal amount of the Second Lien Notes (including, without duplication of any amounts described in item (i), all increases to the principal amount as the result of previous payments of PIK interest) and (iii) the present value of the remaining future interest payments (including cash and PIK components thereof) through September 12, 2026, computed using a discount rate of T + 50 (such amount, the “Make Whole Amount”). On or after September 12, 2026, and prior to September 12, 2027, the Company may, at its option, redeem the Second Lien Notes, in whole or in part for an amount of cash equal to the sum of (i) 105% of the aggregate principal amount of the Second Lien Notes (including all increases to the principal amount as the result of previous payments of PIK interest) plus (ii) 105% of all accrued and unpaid interest (including, without duplication of any amounts described in item (i), cash and PIK components thereof). On or after September 12, 2027, and prior to September 12, 2028, the Company may, at its option, redeem the Second Lien Notes, in whole or in part for an amount of cash equal to the sum of (i) 102.5% of the aggregate principal amount of the Second Lien Notes (including all increases to the principal amount as the result of previous payments of PIK interest) plus (ii) 102.5% of all accrued and unpaid interest (including, without duplication of any amounts described in item (i), cash and PIK components thereof). From September 12, 2028 until maturity, the Company may, at its option, redeem the Second Lien Notes, in whole or in part for an amount of cash equal to the sum of (i) 100% of the aggregate principal amount of the Second Lien Notes (including all increases to the principal amount as the result of previous payments of PIK interest) plus (ii) 100% of all accrued and unpaid interest (including, without duplication of any amounts described in item (i), cash and PIK components thereof). No sinking fund is provided for the Second Lien Notes.
The Second Lien Notes are guaranteed on a senior subordinated basis by certain of the Company’s direct and indirect domestic and foreign subsidiaries and secured by second lien priority security interests in substantially all of the assets of the Company and such subsidiary guarantors, subject to customary exceptions. Pursuant to an intercreditor agreement, the Second Lien Notes are subordinated in right of payment and to collateral, in each case, to the 2029 Notes. The indenture governing the Second Lien Notes contains affirmative and negative covenants and events of default customary for senior secured notes issued in connection with similar transactions. The negative covenants include limitations on asset sales, the incurrence of debt, preferred stock and liens, fundamental changes, investments, dividends and other payment restrictions affecting subsidiaries, restricted payments and transactions with affiliates. Among other things, these covenants generally prohibit the payment of cash dividends on the Company’s common stock. Our failure to comply with these covenants could result in an event of default which, if not cured or waived, could result in the acceleration of the Second Lien Notes. In the event the Second Lien Notes are accelerated prior to September 12, 2028, the applicable acceleration premium set forth in the indenture governing the Second Lien Notes will become due. The indenture governing the Second Lien Notes permits the Company and its subsidiaries to incur, subject to certain requirements, up to (i) $150.0 million of debt that is junior in lien priority and subordinated in right of payment to the Second Lien Notes, and (ii) up to $20.1 million as exchange consideration for, or the proceeds of which are used to repay, the remaining $20.1 million aggregate principal amount of 2026 Notes, which debt may be in the form of additional Second Lien Notes. No embedded derivatives were bifurcated from the Second Lien Notes as the September 2025 Debt Exchange was accounted for as a troubled debt restructuring and the Company recognized a gain in connection with the issuance of the Second Lien Notes.
If the Company undergoes a “Fundamental Change” as defined in the indenture governing the Second Lien Notes, which includes a change of control or the failure of the Company’s common stock to be listed or quoted on any of The Nasdaq Global Select Market, The Nasdaq Global Market or the New York Stock Exchange, holders may require the Company to repurchase all or any portion of their Second Lien Notes at a repurchase price equal to (i) to the Make Whole Amount, if such Fundamental Change occurs prior to September 12, 2026, or (ii) the sum of (A) 105% of the aggregate principal amount of the Second Lien Notes (including all increases to the principal amount as the result of previous payments of PIK interest) plus (B) 105% of all accrued and unpaid interest, if such Fundamental Change occurs on or after September 12, 2026.
Series B Preferred Stock
On the Exchange Closing Date, the Company filed a Certificate of Designation with respect to the Series B Preferred Stock (the “Series B Certificate of Designation”) with the Secretary of State of the State of Delaware and issued to the Noteholders an aggregate 26,551 shares of Series B Preferred Stock. Each share of Series B Preferred Stock had an initial stated value (“Stated Value”) of $1,000 per share, subject to adjustment for (i) any splits, combinations, or similar adjustment and (ii) accrued unpaid dividends. The Series B Preferred Stock did not have a stated maturity and were not subject to mandatory redemption or any sinking fund, and would have remained outstanding indefinitely unless earlier converted, repurchased or redeemed.
On October 2, 2025, the stockholders of the Company approved the Stock Increase Charter Amendment Proposal to increase the authorized common stock share capital of the Company from 13,333,333 shares to 20,000,000 shares. The Stock Increase Charter Amendment was filed with the Secretary of State of the State of Delaware on October 3, 2025. As a result, all of the outstanding shares of Series B Preferred Stock automatically converted pursuant to the terms of the Series B Certificate of Designation, and on October 7, 2025, an aggregate 1,547,840 shares of common stock were issued to holders of the Series B Preferred Stock.
First Lien Convertible Senior Notes due 2029
In June 2024, the Company issued $150.0 million aggregate principal amount of its 2029 Notes pursuant to the Exchange and Purchase Agreement including $100.0 million aggregate principal amount issued in exchange for $146.0 million aggregate principal amount of 2026 Notes and $50.0 million aggregate principal amount issued for cash. The Company paid third parties $7.6 million in connection with the transaction, which was capitalized as debt issuance costs. At the time of the exchange, the fair value of the 2029 Notes approximated $118.1 million, and the Company recognized a debt discount of $31.9 million.
In December 2024, the Company issued $50.0 million aggregate principal amount of its 2029 Notes, constituting the Delayed Draw Notes, for $50.0 million cash.
Unless earlier repurchased or redeemed by the Company or converted pursuant to their terms, the 2029 Notes will mature on the earlier of (a) June 15, 2029 and (b) 91 days before the maturity of the 2026 Notes, if greater than $60.0 million principal amount of 2026 Notes remains outstanding on such date. The amount payable by the Company if the 2029 Notes mature pursuant to clause (b) will be equal to 100% of the aggregate principal amount of the 2029 Notes, plus accrued and unpaid interest, plus the remaining future interest payments that would have been payable through June 15, 2029, discounted at a rate equal to the comparable treasury rate plus 50 basis points (the “Make-Whole Amount”).
From June 3, 2024, until the date of issuance of the Delayed Draw Notes, interest on the 2029 Notes accrued at a rate of 10.83% (consisting of 4.17% cash and 6.66% PIK) per annum. From the date of issuance of the Delayed Draw Notes and prior to December 15, 2026, interest on the 2029 Notes has increased and accrues at a rate of 11.375% (consisting of 4.375% cash and 7.00% PIK) per annum. On and after December 15, 2026, interest on the 2029 Notes will further increase and accrue at a rate of 13% (consisting of 5% cash and 8% PIK) per annum.
The Company may, at its option, redeem the 2029 Notes, in whole or in part, prior to June 15, 2025 at a price equal to the Make-Whole Amount. On or after June 15, 2025, and prior to June 15, 2026, the Company may, at its option, redeem the 2029 Notes, in whole or in part for an amount of cash equal to the sum of (i) 106.50% of the aggregate principal amount of the 2029 Notes (including all increases to the principal amount as the result of previous payments of PIK interest) plus (ii) 106.50% of all accrued and unpaid PIK interest plus (iii) all accrued and unpaid cash interest. On or after June 15, 2026, and prior to December 15, 2026, the Company may, at its option, redeem the 2029 Notes, in whole or in part for an amount of cash equal to the sum of (i) 103.25% of the aggregate principal amount of the 2029 Notes (including all increases to the principal amount as the result of previous payments of PIK interest) plus (ii) 103.25% of all accrued and unpaid PIK interest plus (iii) all accrued and unpaid cash interest. From December 15, 2026 until maturity, the Company may, at its option, redeem the 2029 Notes, in whole or in part for an amount of cash equal to the sum of (i) 113% of the aggregate principal amount of the 2029 Notes (including all increases to the principal amount as the result of previous payments of PIK interest) plus (ii) 113% of all accrued and unpaid PIK interest plus (iii) all accrued and unpaid cash interest. No sinking fund is provided for the 2029 Notes.
The 2029 Notes are guaranteed on a senior basis by certain of the Company’s direct and indirect domestic and foreign subsidiaries and secured by first priority security interests in substantially all of the assets of the Company and such subsidiary guarantors, subject to customary exceptions. The indenture governing the 2029 Notes contains affirmative and negative covenants and events of default customary for senior secured notes issued in connection with similar transactions. The negative covenants include limitations on asset sales, the incurrence of debt, preferred stock and liens, fundamental changes, investments, dividends and other payment restrictions affecting subsidiaries, restricted payments and transactions with affiliates. Among other things, these covenants generally prohibit the payment of cash dividends on the Company’s common stock. The Make-Whole Amount will be payable in the event of an acceleration of the 2029 Notes or repurchase triggered by certain asset sales. The indenture governing the 2029 Notes permits the Company and its subsidiaries to incur, subject to certain requirements, up to $150.0 million of debt that is junior in lien priority and subordinated in right of payment to the 2029 Notes. The indenture governing the 2029 Notes also includes a financial covenant that requires the Company at all times to maintain a minimum cash balance of $60.0 million (excluding proceeds of the 2029 Notes). Upon request of the investor, the indenture governing the 2029 Notes requires the Company to enter into a registration rights agreement with respect to the 2029 Notes containing customary terms including demand, shelf and piggyback registration rights. The Company was in compliance with its financial covenants as of December 31, 2025.
If the Company undergoes a “Fundamental Change” (as defined in the indenture governing the 2029 Notes), which includes a change of control or the failure of the Company’s common stock to be listed or quoted on any of The Nasdaq Global Select Market, The Nasdaq Global Market or the New York Stock Exchange, holders may require the Company to repurchase all or any portion of their 2029 Notes at a repurchase price equal to 100% of the aggregate principal amount of the 2029 Notes to be repurchased, plus accrued and unpaid interest, plus an amount equal to 66% of the remaining future interest payments (including PIK interest) that would have been payable through June 15, 2029, discounted at a rate equal to the comparable treasury rate plus 50 basis points.
Holders of the 2029 Notes may convert their 2029 Notes at their option at any time prior to the close of business on the business day immediately preceding February 15, 2029 only under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on September 30, 2024 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price for the 2029 Notes on each applicable trading day as determined by the Company; (2) during the five business day period after any five consecutive trading day period (the “2029 Notes measurement period”) in which the “trading price” (as defined in the indenture governing the 2029 Notes) per $1,000 principal amount of 2029 Notes for each trading day of the 2029 Notes measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the product of (x) the quotient of (i) the “conversion amount” (as defined in the Indenture) in respect of $1,000 principal amount of the 2029 Notes on such trading day divided by (ii) 1,000 times (y) the conversion rate for the 2029 Notes on each such trading day; (3) with respect to any 2029 Notes that the Company calls for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date; (4) upon the occurrence of specified corporate events; or (5) during the period from August 17, 2026 through September 14, 2026, if the aggregate principal amount of 2026 Notes exceeds $60.0 million on August 16, 2026. On or after February 15, 2029, holders may convert all or any portion of their 2029 Notes at any time prior to the close of business on June 13, 2029, regardless of the foregoing circumstances. The 2029 Notes include certain embedded features requiring bifurcation, which did not have material values as of December 31, 2025 due to management’s estimates of the likelihood of triggering events, but that may have value in the future should those estimates change, with any change in fair value recorded in the Company’s consolidated statements of operations.
The 2029 Notes (including all accrued and unpaid interest) are convertible at the option of the holders at certain times into cash based on a daily conversion value calculated on a proportionate basis for each trading day in a 50 trading day observation period, corresponding to 0.8862 shares of the Company’s common stock per $1,000 principal amount of 2029 Notes. The Company is not required to deliver its common stock upon conversion under any circumstances. The conversion rate for the 2029 Notes is subject to adjustment if certain events occur and contains customary anti-dilution protections. During the three months ended December 31, 2025, the conditions allowing holders of the 2029 Notes to convert were not met.
The 2029 Notes, including the Delayed Draw Notes, are accounted for as a single liability, and the combined carrying amount is $189.8 million as of December 31, 2025, consisting of principal of $221.9 million, net of unamortized issuance costs of $6.1 million and debt discount of $26.0 million. The 2029 Notes were classified as long-term liabilities in the consolidated balance sheets as of December 31, 2025. The remaining term over which the 2029 Notes’ debt issuance costs will be amortized is 3.46 years at an effective interest rate of 19.13% for the 2029 Notes and 13.28% for the Delayed Draw Notes as of December 31, 2025. The 2029 Notes and the Delayed Draw Notes had an effective interest rate of 19.18% and 13.25%, respectively, as of December 31, 2024.
Unamortized debt issuance costs incurred in connection with securing the Company’s financing arrangements are presented in the consolidated balance sheets as a direct deduction from the carrying amount of the outstanding borrowings, consistent with debt discounts. All deferred financing costs are amortized to interest expense. The net carrying amount of the liability component of the Notes as of December 31, 2025 and 2024 was as follows:
| December 31, 2025 | December 31, 2024 | ||||||||||||||||||||||||||||||||||||||||
| 2026 Notes | 2029 Notes | Second Lien Notes (1) | Total | 2026 Notes | 2029 Notes | Total | |||||||||||||||||||||||||||||||||||
| (In thousands) | (In thousands) | ||||||||||||||||||||||||||||||||||||||||
| Principal | $ | 20,125 | $ | 221,877 | $ | 181,952 | $ | 423,954 | $ | 361,204 | 207,125 | $ | 568,329 | ||||||||||||||||||||||||||||
| Unamortized debt discount | — | (25,955) | — | (25,955) | — | (31,137) | (31,137) | ||||||||||||||||||||||||||||||||||
| Unamortized issuance costs | (73) | (6,142) | — | (6,215) | (2,757) | (7,365) | (10,122) | ||||||||||||||||||||||||||||||||||
| Total net carrying value | 20,052 | 189,780 | 181,952 | 391,784 | 358,447 | 168,623 | 527,070 | ||||||||||||||||||||||||||||||||||
| Less: Current portion of long-term debt | (20,052) | — | — | (20,052) | — | — | — | ||||||||||||||||||||||||||||||||||
| Carrying value of long-term debt, net | $ | — | $ | 189,780 | $ | 181,952 | $ | 371,732 | $ | 358,447 | $ | 168,623 | $ | 527,070 | |||||||||||||||||||||||||||
(1) Represents $115.0 million of outstanding principal amount of Second Lien Notes, plus the maximum interest of $58.7 million as well as a redemption premium of $8.3 million.
The following table sets forth the interest expense recognized related to the Notes:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Contractual interest expense | $ | 23,916 | $ | 9,973 | $ | 839 | |||||||||||
| Amortization of debt issuance costs | 2,285 | 2,106 | 4,043 | ||||||||||||||
| Amortization of debt discount | 5,329 | 2,407 | — | ||||||||||||||
| Total interest expense related to the Notes | $ | 31,530 | $ | 14,486 | $ | 4,882 | |||||||||||
Warrants
On June 3, 2024, pursuant to the Exchange and Purchase Agreement, the Company issued to the investor 10-year warrants with a strike price of $11.25 per share, exercisable for 649,782 shares of the Company’s common stock and 10-year warrants with a strike price of $11.25 per share, exercisable with respect to a notional amount of 156,318 shares of the Company’s common stock for cash payments equal to the excess of “fair market value” (as defined therein) per share over the strike price, fully diluted subject to certain adjustments. In August 2025, Warrants with a notional amount of 200,000 shares were settled and a gain of $1.3 million related to the fair value adjustment on settlement date was recognized in Other income (expense), net in the consolidated statements of operations for the year ended December 31, 2025.
The cash-settled warrants will permit the Company, subject to certain conditions (including to the extent that the Company, following payment, would have “available cash” (as defined therein) of less than $100.0 million), to defer payment of the settlement amount at an annualized interest rate of 6.0%, compounded monthly. Warrants outstanding at the 10-year expiration will be exercised automatically (and in the case of the share-settled warrants, will be exercised on a cashless basis) if, immediately prior to the expiration, the fair market value per share is greater than the strike price.
The Warrants contain customary anti-dilution protections. The triggers for the anti-dilution adjustments include (a) subdivision, combination or reclassification of the outstanding shares of common stock into a greater or smaller number of shares, (b) certain below market issuances of common stock, (c) certain issuances of common stock at a price that is less than the strike price of the Warrant, (d) certain issuances of a dividend or distribution to all holders of common stock, (e) an above market tender offer or exchange offer by the Company for common stock. Pursuant to the anti-dilution terms of the Warrants, and giving effect to the settlement of Warrants with respect to a notional amount of 200,000 shares, the aggregate notional amount of the Warrants increased to 1,025,935 shares and the strike price was $6.92 as of December 31, 2025.
In the event of a “Cash/Public Acquisition” (as defined therein), the Warrants may be automatically exercised, cash settled or expire, depending on the fair market value per share. The Warrants contain a beneficial ownership limitation on the investor’s ownership of the Company’s common stock, on a post-exercise basis (aggregating all securities convertible into or exercisable for the Company’s common stock), of 4.99%, subject to increase upon 61 days’ notice by the investor, but not to exceed 9.99%.
The Warrants were classified as current liabilities under ASC 480, Distinguishing Liabilities from Equity, in the Company’s consolidated balance sheets and recorded at fair value of $5.3 million at the issuance date with subsequent changes in fair value recorded in the Company’s consolidated statements of operations. As of December 31, 2025, the Warrants had a fair value of $3.0 million. A gain of $13.2 million and a loss of $12.2 million for the change in fair value were recorded in Other income (expense), net, in the Company’s consolidated statements of operations for the years ended December 31, 2025 and 2024, respectively.
| December 31, 2025 | December 31, 2024 | ||||||||||||||||||||||||||||||||||||||||
| 2026 Notes | 2029 Notes | Second Lien Notes (1) | Total | 2026 Notes | 2029 Notes | Total | |||||||||||||||||||||||||||||||||||
| (In thousands) | (In thousands) | ||||||||||||||||||||||||||||||||||||||||
| Principal | $ | 20,125 | $ | 221,877 | $ | 181,952 | $ | 423,954 | $ | 361,204 | 207,125 | $ | 568,329 | ||||||||||||||||||||||||||||
| Unamortized debt discount | — | (25,955) | — | (25,955) | — | (31,137) | (31,137) | ||||||||||||||||||||||||||||||||||
| Unamortized issuance costs | (73) | (6,142) | — | (6,215) | (2,757) | (7,365) | (10,122) | ||||||||||||||||||||||||||||||||||
| Total net carrying value | 20,052 | 189,780 | 181,952 | 391,784 | 358,447 | 168,623 | 527,070 | ||||||||||||||||||||||||||||||||||
| Less: Current portion of long-term debt | (20,052) | — | — | (20,052) | — | — | — | ||||||||||||||||||||||||||||||||||
| Carrying value of long-term debt, net | $ | — | $ | 189,780 | $ | 181,952 | $ | 371,732 | $ | 358,447 | $ | 168,623 | $ | 527,070 | |||||||||||||||||||||||||||
The following table sets forth the interest expense recognized related to the Notes:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Contractual interest expense | $ | 23,916 | $ | 9,973 | $ | 839 | |||||||||||
| Amortization of debt issuance costs | 2,285 | 2,106 | 4,043 | ||||||||||||||
| Amortization of debt discount | 5,329 | 2,407 | — | ||||||||||||||
| Total interest expense related to the Notes | $ | 31,530 | $ | 14,486 | $ | 4,882 | |||||||||||
The Company measures its cash equivalents at fair value based on an expected exit price as defined by the authoritative guidance on fair value measurements, which represents the amount that would be received on the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value:
•Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
•Level 2: Inputs reflect: quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means.
•Level 3: Unobservable inputs reflecting the Company’s assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available.
Financial Assets and Liabilities
The carrying amount of cash, accounts receivable, and accounts payable approximate their fair value due to their short-term nature. The Company’s assets and liabilities that are measured at fair value on a recurring basis, by level, within the fair value hierarchy as of December 31, 2025 and 2024, are summarized as follows:
| December 31, 2025 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Cash equivalents - money market funds | $ | 43,000 | $ | — | $ | — | $ | 43,000 | |||||||||||||||
| Total assets | $ | 43,000 | $ | — | $ | — | $ | 43,000 | |||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Warrants liability | $ | — | $ | — | $ | 2,999 | $ | 2,999 | |||||||||||||||
| Total liabilities | $ | — | $ | — | $ | 2,999 | $ | 2,999 | |||||||||||||||
| December 31, 2024 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Cash equivalents - money market funds | $ | 105,772 | $ | — | $ | — | $ | 105,772 | |||||||||||||||
| Total assets | $ | 105,772 | $ | — | $ | — | $ | 105,772 | |||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Warrants liability | $ | — | $ | — | $ | 17,498 | $ | 17,498 | |||||||||||||||
| Total liabilities | $ | — | $ | — | $ | 17,498 | $ | 17,498 | |||||||||||||||
In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considers counterparty credit risk in its assessment of fair value. Observable or market inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s assumptions based on the best information available.
The Company’s money market funds are measured at fair value on a recurring basis based on quoted market prices in active markets and are classified as Level 1 within the fair value hierarchy. The Company’s Warrants liability was measured at fair value on a recurring basis and was classified as Level 3 within the fair value hierarchy. Significant changes in unobservable inputs could result in significantly lower or higher fair value measurements.
On a nonrecurring basis, the Company uses fair value measures when analyzing asset impairment. Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If it is determined such indicators are present and the review indicates that the assets will not be fully recoverable, based on undiscounted estimated cash flows over the remaining amortization periods, their carrying values are reduced to estimated fair value. Estimated fair values are Level 3 measures in the fair value hierarchy.
The estimated fair value of outstanding balances of the Notes as of the dates presented are as follows:
Level of Hierarchy | Fair Value | Principal Balance | Unamortized Debt Discount | Unamortized Debt Issuance Costs | Net Carrying Value | ||||||||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||||||||||
| December 31, 2025 | |||||||||||||||||||||||||||||||||||
| 2026 Notes | 2 | $ | 8,175 | $ | 20,125 | $ | — | $ | (73) | $ | 20,052 | ||||||||||||||||||||||||
| 2029 Notes | 3 | $ | 200,601 | $ | 221,877 | $ | (25,955) | $ | (6,142) | $ | 189,780 | ||||||||||||||||||||||||
| Second Lien Notes | 3 | $ | 61,497 | $ | 181,952 | $ | — | $ | — | $ | 181,952 | ||||||||||||||||||||||||
| December 31, 2024 | |||||||||||||||||||||||||||||||||||
| 2026 Notes | 2 | $ | 164,348 | $ | 361,204 | $ | — | $ | (2,757) | $ | 358,447 | ||||||||||||||||||||||||
| 2029 Notes | 3 | $ | 180,360 | $ | 207,125 | $ | (31,137) | $ | (7,365) | $ | 168,623 | ||||||||||||||||||||||||
Management determined the fair value of 2026 Notes by using Level 2 inputs based on observable market prices for the instrument and similar instruments. Management determined the fair value of the 2029 Notes as of December 31, 2025 by using Level 3 inputs, including the volatility of 15%, yield of 16%, risk-free rate of 3.59% and credit spread of 12.81%. Management determined the fair value of the Second Lien Notes as of December 31, 2025 by using Level 3 inputs, including volatility of 15.00%, yield of 30.00%, risk-free rate of 3.64% and credit spread of 24.60%. A change in those inputs to a different amount might result in a significantly higher or lower fair value measurement. Management determined the fair value of the 2029 Notes and Delayed Draw Notes as of December 31, 2024 by using Level 3 inputs, including the yield of 16%, risk-free rate of 4.35%, and credit spread of 11.42%.
Warrants
The Company recorded the fair value of the Warrants upon issuance using the Black-Scholes valuation model and is required to revalue these Warrants at each reporting date with any changes in fair value recorded on the Company’s consolidated statements of operations. The valuation of the Warrants was classified as Level 3 within the fair value hierarchy and is influenced by the fair value of the underlying, or notional amount of, common stock of the Company. A summary of the Black-Scholes pricing model assumptions used to record the fair value of the Warrants as of December 31, 2025 and 2024 is as follows:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Stock price | $3.87 | $1.52 | |||||||||
| Risk free rate | 4.05% | 4.56% | |||||||||
| Expected life (in years) | 8.43 | 9.43 | |||||||||
| Expected volatility | 85.00% | 76.00% | |||||||||
Any significant changes in the inputs may result in significantly higher or lower fair value measurements. Refer to Note 8 – Senior Notes, Capped Call Transactions, Warrants and Preferred Stock for additional information.
The changes in fair value of the Level 3 Warrants as of the dates presented are as follows:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (In thousands) | |||||||||||
| Balance, beginning of year | $ | 17,498 | $ | — | |||||||
| Issuance of Warrants | — | 5,266 | |||||||||
| Settlement of Warrants | (1,297) | — | |||||||||
| Change in fair value of Warrants | (13,202) | 12,232 | |||||||||
| Balance, end of year | $ | 2,999 | $ | 17,498 | |||||||
| December 31, 2025 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Cash equivalents - money market funds | $ | 43,000 | $ | — | $ | — | $ | 43,000 | |||||||||||||||
| Total assets | $ | 43,000 | $ | — | $ | — | $ | 43,000 | |||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Warrants liability | $ | — | $ | — | $ | 2,999 | $ | 2,999 | |||||||||||||||
| Total liabilities | $ | — | $ | — | $ | 2,999 | $ | 2,999 | |||||||||||||||
| December 31, 2024 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Cash equivalents - money market funds | $ | 105,772 | $ | — | $ | — | $ | 105,772 | |||||||||||||||
| Total assets | $ | 105,772 | $ | — | $ | — | $ | 105,772 | |||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Warrants liability | $ | — | $ | — | $ | 17,498 | $ | 17,498 | |||||||||||||||
| Total liabilities | $ | — | $ | — | $ | 17,498 | $ | 17,498 | |||||||||||||||
The estimated fair value of outstanding balances of the Notes as of the dates presented are as follows:
Level of Hierarchy | Fair Value | Principal Balance | Unamortized Debt Discount | Unamortized Debt Issuance Costs | Net Carrying Value | ||||||||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||||||||||
| December 31, 2025 | |||||||||||||||||||||||||||||||||||
| 2026 Notes | 2 | $ | 8,175 | $ | 20,125 | $ | — | $ | (73) | $ | 20,052 | ||||||||||||||||||||||||
| 2029 Notes | 3 | $ | 200,601 | $ | 221,877 | $ | (25,955) | $ | (6,142) | $ | 189,780 | ||||||||||||||||||||||||
| Second Lien Notes | 3 | $ | 61,497 | $ | 181,952 | $ | — | $ | — | $ | 181,952 | ||||||||||||||||||||||||
| December 31, 2024 | |||||||||||||||||||||||||||||||||||
| 2026 Notes | 2 | $ | 164,348 | $ | 361,204 | $ | — | $ | (2,757) | $ | 358,447 | ||||||||||||||||||||||||
| 2029 Notes | 3 | $ | 180,360 | $ | 207,125 | $ | (31,137) | $ | (7,365) | $ | 168,623 | ||||||||||||||||||||||||
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Stock price | $3.87 | $1.52 | |||||||||
| Risk free rate | 4.05% | 4.56% | |||||||||
| Expected life (in years) | 8.43 | 9.43 | |||||||||
| Expected volatility | 85.00% | 76.00% | |||||||||
The changes in fair value of the Level 3 Warrants as of the dates presented are as follows:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (In thousands) | |||||||||||
| Balance, beginning of year | $ | 17,498 | $ | — | |||||||
| Issuance of Warrants | — | 5,266 | |||||||||
| Settlement of Warrants | (1,297) | — | |||||||||
| Change in fair value of Warrants | (13,202) | 12,232 | |||||||||
| Balance, end of year | $ | 2,999 | $ | 17,498 | |||||||
Employee Benefit Plans
The Company has a 401(k) defined contribution plan covering all eligible employees. The Company’s 401(k) policy is a Safe Harbor Plan, whereby the Company matches 100% of the first 3% of eligible compensation and 50% of the next 2% of eligible compensation. The match is immediately vested. Salaries and related expenses include $1.9 million, $2.8 million, and $3.8 million of employer matching contributions for the years ended December 31, 2025, 2024, and 2023, respectively.
Letters of Credit
As of December 31, 2025, the Company had letters of credit totaling $0.5 million outstanding as a security deposit for the due performance by the Company of the terms and conditions of a supply contract.
Contractual obligations
The Company’s purchase obligations consist of agreements to purchase goods and services entered into in the ordinary course of business. The Company has purchase obligation agreements primarily relating to contracts with vendors in connection with Information Technology (“IT”) infrastructure and cloud computing services. In September 2025, the Company entered into a new three-year contract for $74.4 million in purchase commitments over a three-year term. Total purchase commitments remaining as of December 31, 2025 including those under this new contract are as follows: $25.5 million for 2026, $24.5 million for 2027, and $24.4 million for 2028.
Indemnifications
The Company enters into service and license agreements in its ordinary course of business. Pursuant to some of these agreements, the Company agrees to indemnify certain customers from and against certain types of claims and losses suffered or incurred by them as a result of using the Company’s products.
The Company also has agreements whereby its executive officers and directors are indemnified for certain events or occurrences while the officer or director is, or was serving, at the Company’s request in such capacity. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company has a directors and officers insurance policy that reduces its exposure and enables the Company to recover a portion of any future amounts paid. As a result of its insurance policy coverage, the Company believes the estimated fair value of these indemnification agreements is minimal. The Company has no liabilities recorded for these agreements as of December 31, 2025 and 2024.Common Stock
On October 3, 2025, we amended our Restated Certificate of Incorporation to increase the number of outstanding shares of our common stock from 200 million to 300 million. Subsequently, on October 13, 2025, we effected a 1-for-15 Reverse Stock Split, which also resulted in a proportional reduction in the number of authorized shares of our common stock from 300,000,000 to 20,000,000.
As of December 31, 2025, there were 20,000,000 shares of common stock authorized, 12,223,729 shares issued, and 12,039,325 shares outstanding. As of December 31, 2024, there were 13,333,333 shares of common stock authorized, 6,263,782 shares issued, and 6,079,378 shares outstanding. The par value for the common stock is $0.001 per share.
Preferred Stock
As of December 31, 2025 and 2024, there were 5,000,000 shares of preferred stock authorized, and no shares were issued or outstanding. The par value for the preferred stock is $0.001 per share.
Stock-Based Compensation
The Company’s stock-based compensation generally includes stock options, RSUs, PRSUs, and purchases under the Company’s 2019 Employee Stock Purchase Plan (the “ESPP”). Stock-based compensation expense related to RSUs is based on the market value of the underlying stock on the date of grant and the related expense is recognized ratably over the requisite service period. The stock-based compensation expense related to PRSUs is estimated at the grant date based on the expectation that performance goals will be achieved at the stated target level. The amount of compensation cost recognized depends on the relative satisfaction of the performance condition based on performance to date.
Stock Incentive Plans
The Company’s 2019 Stock Incentive Plan became effective on April 11, 2019. The 2019 Stock Incentive Plan, as amended and restated, allows the Company’s employees and directors to participate in the Company’s future performance through grants of stock-based awards of stock options and RSUs at the discretion of the board of directors. The number of shares authorized for issuance under the 2019 Stock Incentive Plan as of December 31, 2025 was 3,487,182 shares. Options to acquire common stock granted under the 2019 Stock Incentive Plan have four-year terms. As of December 31, 2025, 62,029 shares of common stock remained available for issuance (taking into account all stock option exercises and other equity award settlements through December 31, 2025).
Employee Stock Purchase Plan
The number of shares authorized for issuance under the ESPP as of December 31, 2025 was 300,000 shares. As of December 31, 2025, 92,972 shares of common stock remained available for issuance under the ESPP (taking into account all share purchases through December 31, 2025).
Inducement Plan
There are 1,027,489 shares of common stock authorized and reserved for issuance under the Inducement Plan. As of December 31, 2025, 85,615 shares of common stock remained available for issuance under the Inducement Plan (taking into account all option exercises and other equity award settlements through December 31, 2025).
Stock Option Activity
The following table is a summary of the Company’s stock option activity and weighted average exercise prices for the years presented:
| Stock Option Activity | Weighted Average Remaining Contractual Term (In years) | Aggregate Intrinsic Value (In thousands) | |||||||||||||||||||||
| Options (In thousands) | Weighted Average Exercise Price | ||||||||||||||||||||||
| Balance outstanding as of December 31, 2022 | 297 | $ | 363.75 | ||||||||||||||||||||
| Granted | 1 | 170.55 | |||||||||||||||||||||
| Exercised | (4) | 39.30 | |||||||||||||||||||||
| Cancelled or expired | (85) | 340.35 | |||||||||||||||||||||
| Balance outstanding as of December 31, 2023 | 209 | $ | 340.20 | 4.84 | $ | 40 | |||||||||||||||||
| Options vested and expected to vest | 25 | $ | 432.45 | 7.89 | $ | — | |||||||||||||||||
| Options exercisable as of December 31, 2023 | 176 | $ | 325.05 | 4.20 | $ | 40 | |||||||||||||||||
| 209 | $ | 340.20 | |||||||||||||||||||||
Granted (1) | 67 | 15.30 | |||||||||||||||||||||
| Cancelled or expired | (98) | 329.40 | |||||||||||||||||||||
| 178 | $ | 343.95 | 3.95 | $ | 7 | ||||||||||||||||||
| Options vested and expected to vest | 45 | $ | 73.65 | 8.93 | $ | 290 | |||||||||||||||||
| Options exercisable as of December 31, 2024 | 106 | $ | 343.95 | 3.65 | $ | 7 | |||||||||||||||||
| Balance outstanding as of December 31, 2024 | 178 | $ | 343.95 | ||||||||||||||||||||
| Granted | 27 | 16.20 | |||||||||||||||||||||
| Cancelled or expired | (27) | 290.32 | |||||||||||||||||||||
| 178 | $ | 184.30 | 5.92 | $ | — | ||||||||||||||||||
| Options vested and expected to vest | 154 | $ | 210.00 | 5.47 | $ | — | |||||||||||||||||
| Options exercisable as of December 31, 2025 | 84 | $ | 370.98 | 2.91 | $ | — | |||||||||||||||||
(1) Represents an option to purchase 66,666 shares granted to John Sabino, the Company’s Chief Executive Officer, as a standalone grant, that will vest upon satisfaction of certain performance-based and time-based vesting conditions.
The total fair value of stock options exercised during the years ended December 31, 2025 and 2024 was immaterial. The total fair value of stock options exercised during the year ended December 31, 2023 was $3.4 million. As of December 31, 2025, there was $0.4 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements. That cost is expected to be recognized over a weighted average period of approximately 2.4 years.
The per share weighted average fair value of stock options granted during the years ended December 31, 2025, 2024 and 2023 was $12.00, $2.55, and $98.10, respectively. The fair value of each option grant is estimated on the date of grant, adjusted for estimated forfeitures, using the Black-Scholes option pricing model with the following weighted average assumptions:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Dividend yield | —% | —% | —% | ||||||||||||||
| Risk-free interest rate | 3.74% | 4.31% | 3.60% | ||||||||||||||
| Expected life (in years) | 4 | 10 | 5 | ||||||||||||||
| Volatility | 108.51% | 67.10% | 65.17% | ||||||||||||||
A description of the methods used in the significant assumptions used to estimate the fair value of stock-based-based compensation awards follows:
•Dividend yield – The Company uses 0% as it has never issued dividends and does not anticipate issuing dividends in the near term.
•Risk-free interest rate – The Company uses the market yield on zero-coupon U.S. Treasury securities with maturities that approximate the expected life of stock options in years, with the exception of the 2024 grants, which had a 10-year life.
•Expected life – The Company uses historical data to estimate the expected life of a stock option.
•Volatility – The Company estimates expected volatility based on the historical volatility of its common stock over a period consistent with the expected life of the stock options.
Restricted Stock Unit and Performance-Vesting Restricted Stock Unit Activity
The following table is a summary of the Company’s RSUs and PRSUs activity and weighted average grant date fair value, for the years presented:
| Number of Shares | Weighted Average Grant Date Fair Value | Aggregate Fair Value | |||||||||||||||
| (In thousands) | (Per share) | (In thousands) | |||||||||||||||
| Balance outstanding as of December 31, 2022 | 349 | $ | 381.30 | $ | 53,080 | ||||||||||||
| Awarded | 288 | 66.15 | |||||||||||||||
| Released | (180) | 237.90 | |||||||||||||||
| Forfeited | (119) | 378.15 | |||||||||||||||
| Non-vested and outstanding as of December 31, 2023 | 338 | $ | 187.95 | $ | 19,193 | ||||||||||||
| Balance outstanding as of December 31, 2023 | 338 | $ | 187.95 | $ | 19,193 | ||||||||||||
| Awarded | 795 | 14.55 | |||||||||||||||
| Released | (201) | 142.35 | |||||||||||||||
| Forfeited | (97) | 217.35 | |||||||||||||||
| Non-vested and outstanding as of December 31, 2024 | 835 | $ | 30.45 | $ | 14,578 | ||||||||||||
| Balance outstanding as of December 31, 2024 | 835 | $ | 30.45 | $ | 14,578 | ||||||||||||
| Awarded | 750 | 12.17 | |||||||||||||||
| Released | (592) | 26.01 | |||||||||||||||
| Forfeited | (210) | 29.24 | |||||||||||||||
| Non-vested and outstanding as of December 31, 2025 | 783 | $ | 15.45 | $ | 3,028 | ||||||||||||
| Expected to vest | 617 | $ | 14.98 | $ | 2,387 | ||||||||||||
RSUs granted to employees generally vest over a 1 to 4-year period, or upon achievement of certain performance conditions. As of December 31, 2025, total unrecognized compensation cost, adjusted for estimated forfeitures, related to non-vested RSUs was $7.8 million and the weighted-average remaining vesting period was 1.1 years.
PRSUs granted are generally subject to both a service-based vesting condition and a performance-based vesting condition. PRSUs will vest upon the achievement of specified performance targets and subject to continued service through the applicable vesting dates. The associated compensation cost is recognized over the requisite service period when it is probable that the performance condition will be satisfied. There were no PRSU grants in 2025 and 2024. PRSUs granted in 2023 were immaterial. During the year ended December 31, 2025, the outstanding PRSUs vested but the related shares have not been distributed as of December 31, 2025.
Total stock-based compensation costs included in the consolidated statements of operations for the periods presented are as follows:
Year Ended December 31, | |||||||||||||||||
2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Cost of revenue | $ | 583 | $ | 1,080 | $ | 1,456 | |||||||||||
| Sales and marketing | 3,698 | 7,394 | 10,354 | ||||||||||||||
| General and administrative | 5,963 | 6,789 | (5,706) | ||||||||||||||
| Product development | 4,012 | 6,726 | 5,750 | ||||||||||||||
| Total | $ | 14,256 | $ | 21,989 | $ | 11,854 | |||||||||||
The following table is a summary of the Company’s stock option activity and weighted average exercise prices for the years presented:
| Stock Option Activity | Weighted Average Remaining Contractual Term (In years) | Aggregate Intrinsic Value (In thousands) | |||||||||||||||||||||
| Options (In thousands) | Weighted Average Exercise Price | ||||||||||||||||||||||
| Balance outstanding as of December 31, 2022 | 297 | $ | 363.75 | ||||||||||||||||||||
| Granted | 1 | 170.55 | |||||||||||||||||||||
| Exercised | (4) | 39.30 | |||||||||||||||||||||
| Cancelled or expired | (85) | 340.35 | |||||||||||||||||||||
| Balance outstanding as of December 31, 2023 | 209 | $ | 340.20 | 4.84 | $ | 40 | |||||||||||||||||
| Options vested and expected to vest | 25 | $ | 432.45 | 7.89 | $ | — | |||||||||||||||||
| Options exercisable as of December 31, 2023 | 176 | $ | 325.05 | 4.20 | $ | 40 | |||||||||||||||||
| 209 | $ | 340.20 | |||||||||||||||||||||
Granted (1) | 67 | 15.30 | |||||||||||||||||||||
| Cancelled or expired | (98) | 329.40 | |||||||||||||||||||||
| 178 | $ | 343.95 | 3.95 | $ | 7 | ||||||||||||||||||
| Options vested and expected to vest | 45 | $ | 73.65 | 8.93 | $ | 290 | |||||||||||||||||
| Options exercisable as of December 31, 2024 | 106 | $ | 343.95 | 3.65 | $ | 7 | |||||||||||||||||
| Balance outstanding as of December 31, 2024 | 178 | $ | 343.95 | ||||||||||||||||||||
| Granted | 27 | 16.20 | |||||||||||||||||||||
| Cancelled or expired | (27) | 290.32 | |||||||||||||||||||||
| 178 | $ | 184.30 | 5.92 | $ | — | ||||||||||||||||||
| Options vested and expected to vest | 154 | $ | 210.00 | 5.47 | $ | — | |||||||||||||||||
| Options exercisable as of December 31, 2025 | 84 | $ | 370.98 | 2.91 | $ | — | |||||||||||||||||
(1) Represents an option to purchase 66,666 shares granted to John Sabino, the Company’s Chief Executive Officer, as a standalone grant, that will vest upon satisfaction of certain performance-based and time-based vesting conditions.
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Dividend yield | —% | —% | —% | ||||||||||||||
| Risk-free interest rate | 3.74% | 4.31% | 3.60% | ||||||||||||||
| Expected life (in years) | 4 | 10 | 5 | ||||||||||||||
| Volatility | 108.51% | 67.10% | 65.17% | ||||||||||||||
| Number of Shares | Weighted Average Grant Date Fair Value | Aggregate Fair Value | |||||||||||||||
| (In thousands) | (Per share) | (In thousands) | |||||||||||||||
| Balance outstanding as of December 31, 2022 | 349 | $ | 381.30 | $ | 53,080 | ||||||||||||
| Awarded | 288 | 66.15 | |||||||||||||||
| Released | (180) | 237.90 | |||||||||||||||
| Forfeited | (119) | 378.15 | |||||||||||||||
| Non-vested and outstanding as of December 31, 2023 | 338 | $ | 187.95 | $ | 19,193 | ||||||||||||
| Balance outstanding as of December 31, 2023 | 338 | $ | 187.95 | $ | 19,193 | ||||||||||||
| Awarded | 795 | 14.55 | |||||||||||||||
| Released | (201) | 142.35 | |||||||||||||||
| Forfeited | (97) | 217.35 | |||||||||||||||
| Non-vested and outstanding as of December 31, 2024 | 835 | $ | 30.45 | $ | 14,578 | ||||||||||||
| Balance outstanding as of December 31, 2024 | 835 | $ | 30.45 | $ | 14,578 | ||||||||||||
| Awarded | 750 | 12.17 | |||||||||||||||
| Released | (592) | 26.01 | |||||||||||||||
| Forfeited | (210) | 29.24 | |||||||||||||||
| Non-vested and outstanding as of December 31, 2025 | 783 | $ | 15.45 | $ | 3,028 | ||||||||||||
| Expected to vest | 617 | $ | 14.98 | $ | 2,387 | ||||||||||||
Total stock-based compensation costs included in the consolidated statements of operations for the periods presented are as follows:
Year Ended December 31, | |||||||||||||||||
2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Cost of revenue | $ | 583 | $ | 1,080 | $ | 1,456 | |||||||||||
| Sales and marketing | 3,698 | 7,394 | 10,354 | ||||||||||||||
| General and administrative | 5,963 | 6,789 | (5,706) | ||||||||||||||
| Product development | 4,012 | 6,726 | 5,750 | ||||||||||||||
| Total | $ | 14,256 | $ | 21,989 | $ | 11,854 | |||||||||||
LivePerson has undertaken several restructuring initiatives to realign the Company’s cost structure with its current business model, a changing competitive environment and changes in the Company’s commercial performance. In September 2025, the Company initiated a new restructuring plan (the “2025 Restructuring Plan”) to reduce cash expenditures to align with the Company’s current commercial performance, resulting in a charge of $11.7 million for the year ended December 31, 2025. The Company recognized restructuring costs of $11.1 million and $22.7 million during the years ended December 31, 2024 and 2023, respectively. Such costs primarily include severance and other compensation costs and are recorded in Restructuring costs in the consolidated statements of operations. The 2024 and 2025 restructuring activities were considered to be substantially completed in their respective years.
The following table presents the detail of the liability for the Company’s restructuring costs, which is included in Accrued expenses and other current liabilities in the consolidated balance sheets as of December 31, 2025 and 2024:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (In thousands) | |||||||||||
| Balance, beginning of year | $ | 3,028 | $ | 2,076 | |||||||
| Severance and other associated costs | 11,667 | 12,356 | |||||||||
| IT contract termination reversals, net | — | (1,217) | |||||||||
| Cash payments | (13,308) | (10,187) | |||||||||
| Balance, end of year | $ | 1,387 | $ | 3,028 | |||||||
The following table presents the detail of expenses for the Company’s restructuring costs for the periods presented:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Severance and other associated costs | $ | 11,667 | $ | 12,356 | $ | 16,920 | |||||||||||
| IT contract termination (reversals) costs, net | — | (1,217) | 5,744 | ||||||||||||||
| Total restructuring costs | $ | 11,667 | $ | 11,139 | $ | 22,664 | |||||||||||
The following table presents the detail of the liability for the Company’s restructuring costs, which is included in Accrued expenses and other current liabilities in the consolidated balance sheets as of December 31, 2025 and 2024:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (In thousands) | |||||||||||
| Balance, beginning of year | $ | 3,028 | $ | 2,076 | |||||||
| Severance and other associated costs | 11,667 | 12,356 | |||||||||
| IT contract termination reversals, net | — | (1,217) | |||||||||
| Cash payments | (13,308) | (10,187) | |||||||||
| Balance, end of year | $ | 1,387 | $ | 3,028 | |||||||
The following table presents the detail of expenses for the Company’s restructuring costs for the periods presented:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Severance and other associated costs | $ | 11,667 | $ | 12,356 | $ | 16,920 | |||||||||||
| IT contract termination (reversals) costs, net | — | (1,217) | 5,744 | ||||||||||||||
| Total restructuring costs | $ | 11,667 | $ | 11,139 | $ | 22,664 | |||||||||||
Stockholder Litigation
In December 2023, a putative stockholder class action entitled Damri v. LivePerson, Inc., No. 1:23-cv-10517, was filed under the federal securities laws against the Company, its former Chief Executive Officer, and its Chief Financial Officer in the United States District Court for the Southern District of New York. The complaint alleges that the Company’s Form 10-Q filings and forecasts for the first, second, and third quarters of fiscal year 2022 were false and misleading in violation of Section 10(b) of the Securities Exchange Act of 1934, based on the Company’s later disclosures and report on Form 10-K on March 16, 2023. In May 2024, the plaintiff filed an amended complaint. The Company moved to dismiss the amended complaint in August 2024, and in March 2025, the court granted the Company’s motion and dismissed the action with prejudice. In April 2025, the plaintiff appealed the decision to the United States Court of Appeals for the Second Circuit and in March 2026, the dismissal was affirmed but the case was remanded to the district court with leave for the plaintiff to try to replead his complaint. A parallel litigation on behalf of stockholders who purchased their shares on the Tel Aviv Stock Exchange, entitled Weissbrod v. LivePerson, Inc., is pending in the Tel Aviv District Court in Israel, but has been stayed pending further developments in the Damri case.
In January 2024, a purported derivative action entitled Marti v. LoCascio, No. 1:24-cv-00598, was filed in the United States District Court for the Southern District of New York by a purported stockholder of the Company against the Company’s former Chief Executive Officer, its Chief Financial Officer, members of the current Board of Directors and several former Directors. The Marti litigation claims that the Company itself was harmed by the same acts and omissions underlying the Damri federal securities lawsuit and seeks to recover unspecified losses on behalf of the Company. Between June and September 2024, four other purported derivative actions were filed by purported stockholders of the Company against the Company’s former Chief Executive Officer, its Chief Financial Officer, members of the current Board of Directors and several former Directors. These four purported derivative actions, similar to the Marti litigation, claim that the Company itself was harmed by the same acts and omissions underlying the Damri federal securities lawsuit, and seek to recover unspecified losses on behalf of the Company. The four actions are entitled: (i) Steffens v. Block, No. 1:24-cv-04481, filed in the United States District Court for the Southern District of New York; (ii) Ravi v. LoCascio, Index No. 653498/2024, filed in the Supreme Court of the State of New York, New York County; (iii) Morales v. LoCascio, No. 1:24-cv-05297, filed in the United States District Court for the Southern District of New York; and (iv) Perkins v. LoCascio, Index No. 654992/2024, filed in the Supreme Court of the State of New York, New York County. The Marti, Steffens and Morales cases are stayed, and the Perkins case is in abeyance, pending further developments in the Damri case.
In February 2024, Starboard Value LP and several of its related entities and investment funds filed a lawsuit against the Company, its former Chief Executive Officer, and its Chief Financial Officer entitled Starboard Value LP v. LivePerson, Inc., No. 2024-0103, in the Court of Chancery of the State of Delaware. The complaint alleged common law fraud, fraudulent inducement and negligent misrepresentation in connection with an alleged scheme to induce Starboard to settle its 2022 proxy contest against the Company and, as stated in the complaint, involved previous Starboard allegations of misrepresentations in the Company’s public disclosures that the Company previously informed Starboard were found to be unsubstantiated following an independent investigation. Starboard sought damages for its trading losses and purported lost anticipated profits. The defendants filed an answer denying the substantive allegations of the complaint, the parties engaged in discovery, and in July 2025, the litigation was settled. The settlement did not have an impact on the Company’s consolidated statements of operations, as the cost was covered by insurance.
COVID-Related Matters
As has been widely reported, there is heightened scrutiny by the federal government across many programs related to global novel coronavirus disease (“COVID-19”) that were introduced during the COVID-19 pandemic. The Company previously provided products and services related to COVID-19 testing and accompanying software. Those products and services have been the subject of inquiry and review by Medicare, the Department of Justice and the U.S. Food and Drug Administration.
The Company has discontinued all products and services related to COVID-19, and has responded to and intends to continue to cooperate with governmental inquiries related to its previous engagement in COVID-19 related product and service offerings.
Other Legal, Administrative, Governmental and Regulatory Matters
From time to time, the Company is or may be subject to or involved in legal, administrative, governmental and/or regulatory proceedings, inquiries and investigations as well as actual or threatened litigation, claims and/or demands (each an “Action” and collectively “Actions”). These have included and may include (without limitation) Actions brought by or against the Company, its affiliates, subsidiaries, directors and/or officers with respect to intellectual property, contracts, financial, commercial, employment, legal, compliance, privacy, data security, regulatory and/or other matters related to the Company’s business, as well as Actions brought against the Company’s customers for which the Company has a contractual indemnification obligation.
Regardless of the outcome, Actions can have an adverse impact on the Company because of defense and/or settlement costs, diversion of management resources, reputational risks and other factors.
Accruals
The Company accrues for certain contingencies when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated and discloses certain contingencies for which no accrual has been made as appropriate and in compliance with ASC 450, Contingencies. Significant judgment is required in both the determination of probability and the determination as to whether a loss is reasonably estimable. The accruals or estimates, if any, resulting from the foregoing analysis, are reviewed at least quarterly and adjusted to reflect the impact of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular matter.
Income taxes are accounted for under the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences are expected to become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment.
The Company includes interest accrued on the underpayment of income taxes and certain interest expense and penalties, if any, related to unrecognized tax benefits as a component of the income tax provision. The Company recorded a valuation allowance against its U.S., e-bot7 Germany, and Bulgaria deferred tax assets as it considered its cumulative losses in recent years as a significant piece of negative evidence. Since valuation allowances are evaluated by jurisdiction, the Company believes that the deferred tax assets related to LivePerson Australia Pty. Ltd., Engage Pty. Ltd., LivePerson (UK) Ltd., LivePerson Japan, and LivePerson Ltd. (Israel) are more likely than not to be realized as these jurisdictions have positive cumulative pre-tax book income after adjusting for permanent and one-time items.
The One Big Beautiful Bill Act (“OBBBA”) was signed into law on July 4, 2025, and makes changes to the deductibility of certain business expenditures including interest expense, research and development expenditures, and property and equipment, and makes changes to elements of U.S. cross-border taxation. The Company implemented the changes enacted under OBBBA. OBBBA impacted the Company’s deferred tax assets as of July 4, 2025, the date of enactment, via the reversal of $32.0 million of deferred tax assets resulting from capitalized research expenses incurred through December 31, 2024. The reversal is reflected on the Company’s annual financial statements as of and for the year ended December 31, 2025.
The Company had a valuation allowance on certain deferred tax assets for the years ended December 31, 2025, 2024, and 2023 of $243.2 million, $234.6 million, and $211.2 million, respectively. For the years ended December 31, 2025 and 2024, increases in the valuation allowance of $8.6 million and $23.4 million, respectively, were recorded as an expense.
As of December 31, 2025, the Company had $646.0 million of federal NOL carryforwards available to offset future taxable income. Included in this amount is $49.4 million of federal NOL carryovers from the Company’s acquisition of Tenfold in 2021 and $64.9 million of federal NOL carryovers from the Company’s acquisition of VoiceBase in 2021. Of these federal NOL carryforwards, $67.7 million were generated in taxable years ending on or before December 31, 2017 and will expire in various years through 2037. Federal NOL carryforwards generated in taxable years ending after December 31, 2017, do not expire, but generally may only offset up to 80% of federal taxable income earned in a taxable year.
Section 382 of the Internal Revenue Code (“IRC Section 382”) limits a corporation’s ability to utilize NOL and tax credit carryforwards following an ownership change, as defined under IRC Section 382. The Company experienced an ownership change effective September 12, 2025. As a result, utilization of the Company’s federal NOL carryforwards is subject to an annual limitation of approximately $3.3 million.
On January 22, 2024, the Company entered into a Tax Benefits Preservation Plan designed to reduce the risk of substantial impairment to its NOLs that could result from an “ownership change” within the meaning of Section 382 of the Code. The Tax Benefits Preservation Plan creates a disincentive for any person or group of affiliated or associated persons to acquire 4.9% or more of the Company’s outstanding common stock (any such person or group, an “Acquiring Person”), or to further accumulate shares of the Company’s outstanding common stock if such person or group of person already owns 4.9% or more of the Company’s outstanding common stock, without the approval of the Company’s Board, unless and until the Board determines that the Tax Benefits Preservation Plan is no longer necessary or desirable for preservation of the Company’s NOLs.
In connection therewith, on January 22, 2024, the Board authorized a dividend of one right (a “Right”) for each outstanding share of common stock of the Company. Each Right entitles the registered holder to purchase from the Company one one-thousandth of a share of Series A Junior Participating Preferred Stock, par value $0.001 per share, at a price of $18.00, subject to certain adjustments. The Rights will separate from the common stock and become exercisable and separately transferable at the close of business on the date that is the tenth (10th) business day after the earlier of (i) the date on which on which a press release is issued or other public announcement is made indicating that a person or group of affiliated or associated persons has become an Acquiring Person and (ii) the date on which a tender offer or exchange offer is commenced that, upon consummation, would result in a person or group of affiliated or associated persons becoming an Acquiring Person. If issued and not redeemed by the Company, each holder of a Right (other than the Acquiring Person, the Rights of which shall become null and void) will, upon exercise, be entitled to purchase shares of the Company’s common stock having a then-current market value equal to two times the exercise price of the Right. However, prior to exercise, a Right does not give its holder any rights as a stockholder of the Company, including, without limitation, the right to vote or to receive dividends.
The domestic and foreign components of loss before provision for income taxes consist of the following:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| United States | $ | (59,467) | $ | (125,764) | $ | (95,773) | |||||||||||
| Israel | 375 | (42) | 1,074 | ||||||||||||||
| United Kingdom | 1,099 | 1,681 | 1,481 | ||||||||||||||
| Netherlands | 641 | 725 | 2,030 | ||||||||||||||
| Australia | 446 | 662 | (412) | ||||||||||||||
| Germany | (8,282) | (10,246) | (5,453) | ||||||||||||||
Other (1) | 1,407 | 1,446 | 781 | ||||||||||||||
| Total | $ | (63,781) | $ | (131,538) | $ | (96,272) | |||||||||||
——————————————
(1)Includes Bulgaria, Canada, France, India, Italy, Japan, , Mexico, Poland, Singapore and Spain.
No additional provision has been made for U.S. income taxes on the undistributed earnings of its wholly-owned Israeli subsidiary, LivePerson Ltd., as such earnings have been taxed in the U.S. A provision for the undistributed earnings of the Company’s other foreign subsidiaries has not been provided because the Company intends to indefinitely reinvest such earnings outside of the U.S., though if these foreign earnings were to be repatriated in the future the related U.S. tax liability would be immaterial through December 31, 2025.
The provision for income taxes consists of the following:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Current income taxes: | |||||||||||||||||
| U.S. Federal | $ | — | $ | — | $ | — | |||||||||||
| State and local | 998 | 366 | 239 | ||||||||||||||
| Foreign | 1,832 | 1,746 | 2,878 | ||||||||||||||
| Total current income taxes | 2,830 | 2,112 | 3,117 | ||||||||||||||
| Deferred income taxes: | |||||||||||||||||
| U.S. Federal | 166 | 72 | 651 | ||||||||||||||
| State and local | 491 | 532 | 488 | ||||||||||||||
| Foreign | (35) | 19 | (93) | ||||||||||||||
| Total deferred income taxes | 622 | 623 | 1,046 | ||||||||||||||
| Total provision for income taxes | $ | 3,452 | $ | 2,735 | $ | 4,163 | |||||||||||
As further described in Note 1 - Description of Business and Summary of Significant Accounting Policies, the Company has elected to prospectively adopt the guidance in ASU 2023-09. The following table is a reconciliation of the U.S. federal statutory rate of 21% to the Company’s effective rate for the year ended December 31, 2025 in accordance with the guidance in ASU 2023-09:
| Year ended December 31, 2025 | |||||||||||
| Amount | Percent | ||||||||||
| (In thousands) | |||||||||||
| Loss before provision for income taxes | $ | (63,781) | |||||||||
| Income tax benefit at U.S. federal statutory rate | (13,394) | 21.00 | % | ||||||||
State and local income taxes (net of federal income tax effect) (1) | 1,702 | (2.67) | % | ||||||||
| Foreign tax effects: | |||||||||||
| Germany | |||||||||||
| Goodwill impairment | 2,513 | (3.94) | % | ||||||||
| Rate differential | (993) | 1.56 | % | ||||||||
| Other | 218 | (0.34) | % | ||||||||
| Other foreign countries | 282 | (0.44) | % | ||||||||
| Effect of cross-border taxes laws | 79 | (0.12) | % | ||||||||
| Changes in valuation allowances | 5,905 | (9.26) | % | ||||||||
| Nontaxable or nondeductible items: | |||||||||||
| Goodwill impairment | 7,053 | (11.06) | % | ||||||||
| Stock-based compensation - excess tax benefit / (tax deficiency) | 1,856 | (2.91) | % | ||||||||
| Warrant revaluation | (3,045) | 4.77 | % | ||||||||
| Other nontaxable or nondeductible items | 681 | (1.07) | % | ||||||||
| Change in unrecognized tax benefits: | 683 | (1.07) | % | ||||||||
| Other adjustments | |||||||||||
| Other items | (88) | 0.14 | % | ||||||||
| Total income tax expense and effective rate | $ | 3,452 | (5.41) | % | |||||||
(1) State taxes in California make up the majority (greater than 50%) of the tax effect in this category in 2025.
The difference between the total income taxes computed at the federal statutory rate and the provision for income taxes consists of the following:
| December 31, | |||||||||||||||||
| 2024 | 2023 | ||||||||||||||||
| Federal statutory rate | 21.00 | % | 21.00 | % | |||||||||||||
| State taxes, net of federal benefit | 3.16 | % | 3.94 | % | |||||||||||||
| Non-deductible expenses – stock-based compensation | (0.14) | % | (0.55) | % | |||||||||||||
| Non-deductible expenses – earn-out | — | % | 5.50 | % | |||||||||||||
| Non-deductible excess compensation | (0.14) | % | (0.04) | % | |||||||||||||
| Foreign taxes | (0.53) | % | (0.94) | % | |||||||||||||
| Valuation allowance | (18.19) | % | (24.40) | % | |||||||||||||
| Stock based compensation – excess tax benefit / (tax deficiency) | (5.00) | % | (7.00) | % | |||||||||||||
| Goodwill impairment | (7.96) | % | (2.59) | % | |||||||||||||
| Sale of subsidiary | 7.18 | % | 1.69 | % | |||||||||||||
| Debt restructuring | (1.83) | % | — | % | |||||||||||||
| Other | 0.37 | % | (0.93) | % | |||||||||||||
| Total provision | (2.08) | % | (4.32) | % | |||||||||||||
The amounts of income tax related taxes paid, net of refunds received, were as follows:
| Year ended December 31, 2025 | |||||
| (In thousands) | |||||
| State | $ | 55 | |||
| Foreign: | |||||
| United Kingdom | 490 | ||||
| Germany | 438 | ||||
| India | 309 | ||||
| Poland | 240 | ||||
| Israel | 176 | ||||
| Netherlands | (637) | ||||
| All other | 95 | ||||
| Total foreign | 1,111 | ||||
| Income taxes, net of amounts refunded | 1,166 | ||||
| Other taxes | 41 | ||||
| Total taxes paid, net of refunds | $ | 1,207 | |||
The effects of temporary differences and federal NOL carryforwards that give rise to significant portions of federal deferred tax assets and deferred tax liabilities as of the dates presented:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (In thousands) | |||||||||||
| Deferred tax assets, net: | |||||||||||
| Net operating loss carryforwards | $ | 173,899 | $ | 172,923 | |||||||
| R&D tax credit | 1,757 | 1,757 | |||||||||
| Original issue discount | 25,502 | 7,330 | |||||||||
| Interest | 13,811 | 7,544 | |||||||||
| Operating lease liabilities | (12) | (1) | |||||||||
| Accounts payable and accrued expenses | 4,622 | 4,266 | |||||||||
| Non-cash compensation | 6,952 | 7,617 | |||||||||
| Intangibles amortization | 2,978 | 3,170 | |||||||||
| R&D capitalization | 32,732 | 58,237 | |||||||||
| Allowance for credit loss | 843 | 2,067 | |||||||||
| Total deferred tax assets | 263,084 | 264,910 | |||||||||
| Less valuation allowance | (243,240) | (234,620) | |||||||||
| Deferred tax assets, net | 19,844 | 30,290 | |||||||||
| Deferred tax liabilities: | |||||||||||
| Property and equipment | (9,929) | (12,337) | |||||||||
| Goodwill amortization and contingent earn-out adjustments | (9,607) | (9,048) | |||||||||
| Outside basis difference in subsidiary stock | — | (8,040) | |||||||||
| Operating lease right-of-use assets | 7 | 4 | |||||||||
| Total deferred tax liabilities | (19,529) | (29,421) | |||||||||
| Net deferred tax assets | $ | 315 | $ | 869 | |||||||
The Company has U.S. federal, Australian, and German NOLs of $646.0 million, $0.2 million, and $30.8 million, respectively. The Australian and German NOLs can be carried forward indefinitely. For the federal NOLs, $578.3 million can be carried forward indefinitely, $67.7 million will expire between 2030 and 2037. The Company has $522.9 million of state NOLs, of which $133.6 million can be carried forward indefinitely and $389.2 million will expire between 2026 and 2045.
ASC 740-10 clarifies the accounting for uncertainty in income taxes recognized in the financial statements in accordance with other provisions contained within this guidance. This topic prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by the taxing authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50% likely of being realized upon ultimate audit settlement. The Company had unrecognized tax benefits of $3.8 million and $3.5 million as of December 31, 2025 and 2024, respectively, that would affect the effective tax rate if recognized. Accrued interest and penalties included in the Company’s liability related to unrecognized tax benefits and recorded in Accrued expenses and other current liabilities was $1.2 million and $0.7 million as of December 31, 2025 and 2024, respectively. There are no unrecognized tax benefits expected to reverse in the next twelve months and impact the effective tax rate.
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Unrecognized tax benefits balance, beginning of year | $ | 3,536 | $ | 3,061 | $ | 2,721 | |||||||||||
| Gross increase for tax positions of prior years | — | 204 | — | ||||||||||||||
| Gross increase for tax positions of current year | 286 | 271 | 340 | ||||||||||||||
| Unrecognized tax benefits, end of year | $ | 3,822 | $ | 3,536 | $ | 3,061 | |||||||||||
The domestic and foreign components of loss before provision for income taxes consist of the following:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| United States | $ | (59,467) | $ | (125,764) | $ | (95,773) | |||||||||||
| Israel | 375 | (42) | 1,074 | ||||||||||||||
| United Kingdom | 1,099 | 1,681 | 1,481 | ||||||||||||||
| Netherlands | 641 | 725 | 2,030 | ||||||||||||||
| Australia | 446 | 662 | (412) | ||||||||||||||
| Germany | (8,282) | (10,246) | (5,453) | ||||||||||||||
Other (1) | 1,407 | 1,446 | 781 | ||||||||||||||
| Total | $ | (63,781) | $ | (131,538) | $ | (96,272) | |||||||||||
——————————————
(1)Includes Bulgaria, Canada, France, India, Italy, Japan, , Mexico, Poland, Singapore and Spain.
The provision for income taxes consists of the following:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Current income taxes: | |||||||||||||||||
| U.S. Federal | $ | — | $ | — | $ | — | |||||||||||
| State and local | 998 | 366 | 239 | ||||||||||||||
| Foreign | 1,832 | 1,746 | 2,878 | ||||||||||||||
| Total current income taxes | 2,830 | 2,112 | 3,117 | ||||||||||||||
| Deferred income taxes: | |||||||||||||||||
| U.S. Federal | 166 | 72 | 651 | ||||||||||||||
| State and local | 491 | 532 | 488 | ||||||||||||||
| Foreign | (35) | 19 | (93) | ||||||||||||||
| Total deferred income taxes | 622 | 623 | 1,046 | ||||||||||||||
| Total provision for income taxes | $ | 3,452 | $ | 2,735 | $ | 4,163 | |||||||||||
| Year ended December 31, 2025 | |||||||||||
| Amount | Percent | ||||||||||
| (In thousands) | |||||||||||
| Loss before provision for income taxes | $ | (63,781) | |||||||||
| Income tax benefit at U.S. federal statutory rate | (13,394) | 21.00 | % | ||||||||
State and local income taxes (net of federal income tax effect) (1) | 1,702 | (2.67) | % | ||||||||
| Foreign tax effects: | |||||||||||
| Germany | |||||||||||
| Goodwill impairment | 2,513 | (3.94) | % | ||||||||
| Rate differential | (993) | 1.56 | % | ||||||||
| Other | 218 | (0.34) | % | ||||||||
| Other foreign countries | 282 | (0.44) | % | ||||||||
| Effect of cross-border taxes laws | 79 | (0.12) | % | ||||||||
| Changes in valuation allowances | 5,905 | (9.26) | % | ||||||||
| Nontaxable or nondeductible items: | |||||||||||
| Goodwill impairment | 7,053 | (11.06) | % | ||||||||
| Stock-based compensation - excess tax benefit / (tax deficiency) | 1,856 | (2.91) | % | ||||||||
| Warrant revaluation | (3,045) | 4.77 | % | ||||||||
| Other nontaxable or nondeductible items | 681 | (1.07) | % | ||||||||
| Change in unrecognized tax benefits: | 683 | (1.07) | % | ||||||||
| Other adjustments | |||||||||||
| Other items | (88) | 0.14 | % | ||||||||
| Total income tax expense and effective rate | $ | 3,452 | (5.41) | % | |||||||
(1) State taxes in California make up the majority (greater than 50%) of the tax effect in this category in 2025.
The difference between the total income taxes computed at the federal statutory rate and the provision for income taxes consists of the following:
| December 31, | |||||||||||||||||
| 2024 | 2023 | ||||||||||||||||
| Federal statutory rate | 21.00 | % | 21.00 | % | |||||||||||||
| State taxes, net of federal benefit | 3.16 | % | 3.94 | % | |||||||||||||
| Non-deductible expenses – stock-based compensation | (0.14) | % | (0.55) | % | |||||||||||||
| Non-deductible expenses – earn-out | — | % | 5.50 | % | |||||||||||||
| Non-deductible excess compensation | (0.14) | % | (0.04) | % | |||||||||||||
| Foreign taxes | (0.53) | % | (0.94) | % | |||||||||||||
| Valuation allowance | (18.19) | % | (24.40) | % | |||||||||||||
| Stock based compensation – excess tax benefit / (tax deficiency) | (5.00) | % | (7.00) | % | |||||||||||||
| Goodwill impairment | (7.96) | % | (2.59) | % | |||||||||||||
| Sale of subsidiary | 7.18 | % | 1.69 | % | |||||||||||||
| Debt restructuring | (1.83) | % | — | % | |||||||||||||
| Other | 0.37 | % | (0.93) | % | |||||||||||||
| Total provision | (2.08) | % | (4.32) | % | |||||||||||||
The amounts of income tax related taxes paid, net of refunds received, were as follows:
| Year ended December 31, 2025 | |||||
| (In thousands) | |||||
| State | $ | 55 | |||
| Foreign: | |||||
| United Kingdom | 490 | ||||
| Germany | 438 | ||||
| India | 309 | ||||
| Poland | 240 | ||||
| Israel | 176 | ||||
| Netherlands | (637) | ||||
| All other | 95 | ||||
| Total foreign | 1,111 | ||||
| Income taxes, net of amounts refunded | 1,166 | ||||
| Other taxes | 41 | ||||
| Total taxes paid, net of refunds | $ | 1,207 | |||
The effects of temporary differences and federal NOL carryforwards that give rise to significant portions of federal deferred tax assets and deferred tax liabilities as of the dates presented:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (In thousands) | |||||||||||
| Deferred tax assets, net: | |||||||||||
| Net operating loss carryforwards | $ | 173,899 | $ | 172,923 | |||||||
| R&D tax credit | 1,757 | 1,757 | |||||||||
| Original issue discount | 25,502 | 7,330 | |||||||||
| Interest | 13,811 | 7,544 | |||||||||
| Operating lease liabilities | (12) | (1) | |||||||||
| Accounts payable and accrued expenses | 4,622 | 4,266 | |||||||||
| Non-cash compensation | 6,952 | 7,617 | |||||||||
| Intangibles amortization | 2,978 | 3,170 | |||||||||
| R&D capitalization | 32,732 | 58,237 | |||||||||
| Allowance for credit loss | 843 | 2,067 | |||||||||
| Total deferred tax assets | 263,084 | 264,910 | |||||||||
| Less valuation allowance | (243,240) | (234,620) | |||||||||
| Deferred tax assets, net | 19,844 | 30,290 | |||||||||
| Deferred tax liabilities: | |||||||||||
| Property and equipment | (9,929) | (12,337) | |||||||||
| Goodwill amortization and contingent earn-out adjustments | (9,607) | (9,048) | |||||||||
| Outside basis difference in subsidiary stock | — | (8,040) | |||||||||
| Operating lease right-of-use assets | 7 | 4 | |||||||||
| Total deferred tax liabilities | (19,529) | (29,421) | |||||||||
| Net deferred tax assets | $ | 315 | $ | 869 | |||||||
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Unrecognized tax benefits balance, beginning of year | $ | 3,536 | $ | 3,061 | $ | 2,721 | |||||||||||
| Gross increase for tax positions of prior years | — | 204 | — | ||||||||||||||
| Gross increase for tax positions of current year | 286 | 271 | 340 | ||||||||||||||
| Unrecognized tax benefits, end of year | $ | 3,822 | $ | 3,536 | $ | 3,061 | |||||||||||
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
(Amendment No. 1)
For the Fiscal Year Ended December 31 , 2025
OR
For the Transition Period from _____ to _____
Commission File Number 000-30141
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) | |||||||
| (Address of Principal Executive Offices) | (Zip Code) | |||||||
(212 ) 609-4200
(Registrant’s telephone Number, including area Code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Rights to Purchase Series A Junior Participating Preferred Stock | None | |||||||||||||
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large Accelerated Filer | ☐ | ☒ | |||||||||||||||
| Non-accelerated Filer | ☐ | Smaller Reporting Company | |||||||||||||||
| Emerging Growth Company | |||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
The aggregate market value of the voting common stock held by non-affiliates of the registrant as of June 30, 2025 (the last business day of the registrant’s most recently completed second fiscal quarter) was $84,994,598 (computed by reference to the last reported sale price on The Nasdaq Global Select Market on that date). The registrant does not have any non-voting common stock outstanding.
On March 6, 2026, 12,053,603 shares of the registrant’s common stock were outstanding.
Auditor Name | Auditor Location | Auditor Firm ID | ||||||||||||
LIVEPERSON, INC.
AMENDMENT NO. 1 TO 2025 ANNUAL REPORT ON FORM 10-K/A
TABLE OF CONTENTS
| Page | ||||||||
Explanatory Note | ii | |||||||
Cautionary Statement Concerning Forward-Looking Statements | iii | |||||||
PART III | ||||||||
| Item 10. | Directors, Executive Officers and Corporate Governance | 1 | ||||||
| Item 11. | Executive Compensation | 7 | ||||||
| Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 24 | ||||||
| Item 13. | Certain Relationships and Related Transactions, and Director Independence | 26 | ||||||
| Item 14. | Principal Accountant Fees and Services | 28 | ||||||
PART IV | ||||||||
| Item 15. | Exhibits and Financial Statement Schedules | 29 | ||||||
Signatures | 33 | |||||||
i
EXPLANATORY NOTE
LivePerson, Inc. (“LivePerson,” the “Company,” “we,” “our” or “us”) is filing this Amendment No. 1 on Form 10-K/A (this “Amendment”) to amend the Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (the “2025 Fiscal Year”) originally filed with the Securities and Exchange Commission (the “SEC”) by the Company on March 16, 2026 (the “Original Form 10‑K”) for the purpose of including the information required by Items 10 through 14 of Part III of Form 10-K. This information was omitted from the Original Form 10‑K in reliance on General Instruction G(3) to Form 10-K, which permits such information to be incorporated by reference from a registrant’s definitive proxy statement, if filed with the SEC not later than 120 days after the end of the fiscal year covered by a Form 10-K (or as such deadline may be extended pursuant to Rule 0-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (the “Filing Deadline”)). We will not have filed our definitive proxy statement by the Filing Deadline and are therefore amending and restating in their entirety Items 10, 11, 12, 13 and 14 of Part III of the Original Form 10-K.
In addition, as required by Rule 12b-15 under the Exchange Act, certifications by LivePerson’s principal executive officer and principal financial officer are filed as exhibits to this Amendment under Item 15 of Part IV hereof. Because no financial statements have been included in this Amendment and this Amendment does not contain or amend any disclosure with respect to Items 307 and 308 of Regulation S-K, paragraphs 3, 4 and 5 of the certifications have been omitted. We are not including certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 as no financial statements are being filed with this Amendment.
This Amendment does not reflect events occurring after the filing of the Original Form 10-K or modify or update the disclosure contained in the Original Form 10‑K in any way other than as required to reflect the amendments discussed above and reflected below. Accordingly, this Amendment should be read in conjunction with the Original Form 10-K and with the Company’s filings with the SEC subsequent to the filing of the Original Form 10-K. Capitalized terms used but not defined herein have the meanings assigned to them in the Original Form 10-K.
ii
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
Statements in this Amendment about LivePerson that are not historical facts are forward-looking statements. These forward-looking statements are based on our current expectations, assumptions, estimates and projections about LivePerson and our industry. Our expectations, assumptions, estimates and projections are expressed in good faith, and we believe there is a reasonable basis for them, but we cannot assure you that our expectations, assumptions, estimates and projections will be realized. Examples of forward-looking statements include, but are not limited to, statements regarding future business, future results of operations or financial condition (including statements regarding expectations for retention rates, customer attrition and revenue and other statements based on examinations of historical operating trends) and management strategies. Many of these statements are found in the “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Original Form 10-K. When used in this Amendment, the words “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “projects,” and variations of such words or similar expressions are intended to identify forward-looking statements. However, not all forward-looking statements contain these words. Forward-looking statements are subject to risks and uncertainties that could cause actual future events or results to differ materially from those expressed or implied in the forward-looking statements. Important factors that could cause our actual results to differ materially from the forward-looking statements we make in this Amendment include those set forth in the section of the Original Form 10-K entitled Part 1, Item 1A., “Risk Factors.” It is routine for our internal projections and expectations to change as the year or each quarter in the year progresses, and therefore it should be clearly understood that the internal projections and beliefs upon which we base our expectations may change prior to the end of each quarter or the year. Although these expectations may change, we are under no obligation to inform you if they do. Our policy is generally to provide our expectations only once per quarter, and not to update that information until the next quarter. We do not undertake any obligation to revise forward-looking statements to reflect future events or circumstances. All forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
iii
PART III
Item 10. Directors, Executive Officers and Corporate Governance
The following is a brief biographical summary of the experience of our directors, including their ages as of April 30, 2026.
Jim Miller, 62, has served as a member of the Board since February 2023 and as Chair of the Board since October 2024. Mr. Miller brings over 20 years of board, C-Suite and executive experience at leading technology and e-commerce companies such as Google, Wayfair, The RealReal, Amazon, Sanmina-SCI and Cisco. Since January 2023, Mr. Miller has served as a Senior Advisor of Boston Consulting Group, a global management and consulting firm. Mr. Miller previously served as Chief Technology Officer of Wayfair, Inc. from 2019 to 2022. Prior to Wayfair, he served as Chief Executive Officer of AREVO Inc., a 3-D printing company, and previously held executive leadership roles at Google including Vice President of Operations, Ads and Commerce, and Vice President of Worldwide Operations & Google Energy LLC. Prior to joining Google, Mr. Miller was Executive Vice President at Sanmina-SCI Corporation, one of the world’s largest electronic manufacturing service providers. Mr. Miller has also held executive roles in operations and supply chain at FirstSolar, Inc., Cisco Systems, Inc. and Amazon.com, Inc. Mr. Miller currently serves on the boards of The RealReal, Inc. (NASDAQ:REAL), a Nasdaq-listed online luxury resale store, Brambles Ltd. (ASX:BXB), an ASX-listed supply-chain logistics company, and Service Express, a provider of third-party maintenance services and a subsidiary of private equity firm Warburg Pincus LLC. He previously served on the board of Wayfair before becoming its Chief Technology Officer, and ITRenew, Inc., a privately-held global provider of data sanitization and IT asset disposition services. Mr. Miller earned a B.S. in aerospace engineering from Purdue University, an M.S. in mechanical engineering from the Massachusetts Institute of Technology and an M.B.A. from MIT’s Sloan School of Management.
Mr. Miller brings to the Board extensive experience in scaling rapidly-growing internet companies, technological and operational expertise and significant knowledge of financial management and corporate strategy.
Dan Fletcher, 42, has served as a member of the Board since November 2024. Mr. Fletcher brings over 18 years of SaaS industry financial, strategic, and operational experience, with particular specialization in financial, strategic and operational organizational transformation. As an experienced CFO, his areas of expertise include profitability analysis and improvement, budgeting and forecasting, strategic planning, operating strategy design and execution, cash flow and working capital management, sales force effectiveness, organizational design, post-acquisition integration, and project management.
Mr. Fletcher joined Vector Capital Management, L.P. (together with its affiliates, the “Vector Group”) in June 2018, where he served as an Operating Principal until February 2025 and has served as Chief Financial Officer for multiple Vector Group investments. Mr. Fletcher currently serves as Chief Financial Officer of Planful, Inc., a leading SaaS provider of cloud-based enterprise performance management applications (January 2022 - present and December 2018 - May 2020). Previously, he served as Chief Financial Officer of MarkLogic Corporation, a leading provider of data management and data integration solutions for large enterprise and public sector customers (October 2020 - December 2021). From 2014 until June 2018, Mr. Fletcher was a Manager at Alvarez & Marsal, a leading consulting firm, where he served in interim management roles for portfolio companies of Alvarez & Marsal clients. He was previously employed as an associate at Sterling Partners, a private equity firm based in Chicago, and at PricewaterhouseCoopers LLP. In addition, Mr. Fletcher has served as a director of two privately held companies: Gappify, Inc., a leading provider of accrual automation solutions for corporate accountants (August 2021 - present) and Reconext, an industry leader in providing reverse logistic solutions to wireless and electronics customers (March 2020 - February 2021). Mr. Fletcher holds a B.S. and Master’s degree in Accountancy from the University of Missouri.
Mr. Fletcher brings to the Board extensive experience in SaaS industry operations and finance, including with strategic initiatives to enhance shareholder value.
1
Nathan “Tripp” Lane, 48, has served as a member of the Board since November 2025. Mr. Lane is the founder of Delancey Cove LLC, a consulting firm, where he has been an advisor, board member and interim manager for companies undergoing turnarounds and restructurings since 2017. Mr. Lane has also served as a director for a number of public and private companies since 2019, including as a non-executive director of Card Factory PLC from 2020-2024, National Cinemedia from 2024-2025, and Benchmark Holdings PLC from 2024-2025. Prior to Delancey Cove, Mr. Lane was an investment professional with BlueMountain Capital Management, LLC, a hedge fund, from 2015 to 2017, and a Principal at Apax Partners, L.P., a global private equity advisory firm, from 2006 to 2015 where he focused on investments in the consumer, retail and media industries. Mr. Lane holds a B.A. from Colgate University, an M.A. from the School of Advanced International Studies (SAIS), Johns Hopkins University, and an M.B.A. from The Wharton School, University of Pennsylvania.
Mr. Lane brings to the Board extensive experience serving as an advisor, board member and interim manager guiding public and private companies through significant corporate transitions and periods of business and operational transformation, and over two decades of business experience with a focus on consumer, retail, media, and technology industries.
Vanessa Pegueros, 61, has served as a member of the Board since December 2022. Ms. Pegueros has served as a Venture Partner at Flying Fish Partners since 2018. Ms. Pegueros brings over three decades of experience and leadership in software, technology and cybersecurity to LivePerson. Most recently, she served as the Chief Trust & Security Officer of Onelogin, Inc., the identity platform for secure, scalable and smart experiences that connect people to technology, from 2019 until 2022. Prior to that, Ms. Pegueros served as Vice President and Chief Information Security Officer of DocuSign, Inc., the world’s leading way to electronically sign and manage contracts, from 2013 until 2019. Ms. Pegueros also previously served as Senior Vice President of Information Security at U.S. Bancorp; Chief Information Security Officer at Expedia Group, Inc.; and First Vice President, Security Assessment Services at Washington Mutual, Inc. Currently, Ms. Pegueros serves on the board of Prisidio Inc., a cloud-based secure digital vault, and as a member of the board, the Nominating and Governance Committee and the Audit Committee of Boeing Employee Credit Union. Previously, Ms. Pegueros served on the public company board of Carbon Black, Inc., an endpoint security company, which was acquired by VMware, Inc. in October 2019. Ms. Pegueros earned an M.B.A. from Stanford Graduate School of Business, an M.S. in Telecommunications from the University of Colorado at Boulder, and a B.S. in Mechanical Engineering from the University of California at Berkeley. She is Directorship Certified through the NACD as well as a certified Qualified Technology Expert through the Digital Directors Network. She also holds GSEC, CRISC, CISM, and CISSP security certifications as well as the Certified Information Privacy Professional Europe (CIPP/E) privacy certification.
Ms. Pegueros brings to the Board extensive senior leadership experience, technological expertise and innovation, and deep knowledge in the areas of governance and organizational management.
John Sabino, 53, has served as our Chief Executive Officer (“CEO”) and as a member of the Board since January 2024. Prior to joining LivePerson, Mr. Sabino served as Chief Customer Officer of VMware, Inc., a cloud computing and virtualization technology company, from October 2021 to January 2024, where he led the company’s 7,000-person global customer success organization. From 2017 to October 2021, Mr. Sabino served as Chief Customer Officer of Splunk Inc., a software company focused on data management and digital system security solutions where he oversaw customer experience for Splunk’s more than 18,000 customers. From March 2015 to April 2017, Mr. Sabino served as Chief Operating Officer of GE Digital (currently known as GE Vernova, Inc.), an industrial software company focused on creating the infrastructure and next generation capabilities for the industrial internet, where he led operations and oversaw strategy, go-to-market, and technology infrastructure. Mr. Sabino started his career as a captain in the United States Army and has held executive roles leading commercial operations and strategic initiatives at General Electric Capital Corporation and NBCUniversal Media LLC. Mr. Sabino earned an M.B.A. from USC’s Marshall School of Business and a B.S. from the United States Military Academy at West Point.
2
Mr. Sabino brings to the Board a unique perspective on LivePerson’s business as well as his strategic vision and operational insights as the Company’s CEO. In addition, the Company values Mr. Sabino’s SaaS and enterprise software leadership experience and deep familiarity with the technology and digital business industry.
Karin-Joyce (K.J.) Tjon, 64, has served as a member of the Board since November 2024. Ms. Tjon is a seasoned finance and operations leader with over 25 years of executive and board leadership experience including public and private technology and SaaS companies. Ms. Tjon has a proven track record of driving business transformation, and deep expertise in turnaround management as well as complex debt and cost restructuring. Ms. Tjon currently serves on the boards of directors of Solidion Technology, Inc. (NASDAQ:STI), a publicly traded company that develops and supplies technologies for electric vehicles (since 2022), and NPH International, a charitable organization. From July 2018 until May 2020, Ms. Tjon served as Chief Financial Officer of Alorica, Inc., a multi-billion dollar provider of technology-enabled customer service solutions for large enterprises, where she was instrumental in strengthening the company’s capital structure, including leading significant debt restructuring initiatives. From February 2017 until August 2017, Ms. Tjon was President and Chief Operating Officer of Scientific Games, Inc. From July 2014 until September 2016, Ms. Tjon served as the Executive Vice President and Chief Financial Officer for Epiq Systems, Inc., a formerly publicly traded provider of technology-enabled solutions for the legal industry. From August 2011 to May 2014, Ms. Tjon served as Chief Financial Officer at Hawker Beechcraft, Inc. From 2002-2011, Ms. Tjon served as Managing Director at Alvarez & Marsal, a leading consulting firm, where her practice focused on business transformation, turnaround management and driving operating performance. Ms. Tjon also previously served on the board of Kaleyra, Inc., a global provider of enterprise mobile and omnichannel communication services from December 2022 through the company’s acquisition by Tata Communications in November 2023. Ms. Tjon earned an M.B.A. from Columbia University’s Graduate School of Business and a B.S.S. in specialized studies in Organizational Behavior from Ohio University.
Ms. Tjon brings to the Board significant financial, operational and leadership experience as a director, C-Suite executive and corporate advisor for public and private companies, deep expertise in turnaround management as well as complex debt and cost restructuring, along with her demonstrated track record driving operating performance and innovation.
Ryan Vardeman, 48, has served as a member of the Board since October 2025. Mr. Vardeman serves as a principal and co-founder of Palogic Value Management, L.P., a Dallas, Texas based investment management company, a position he has held since January 2007. Mr. Vardeman has extensive corporate strategy, operating, financial and investment experience including capital structure analysis, a focus on small-cap equities, and investing in a broad range of industries with an emphasis on technology and software companies. Mr. Vardeman also served on the board of directors of BSQUARE Corporation from 2018 to 2023, including serving in the role of Chairman of the Compensation Committee, Chairman of the Board and member of the Governance and Nominating Committee, and ITEVAC, Inc. from November 2024 to March 2025. Mr. Vardeman holds a B.S. in Electrical Engineering and Computer Science from Texas Tech University and an M.B.A. from the Owen Graduate School of Management at Vanderbilt University.
Mr. Vardeman brings to the Board extensive experience in finance, corporate strategy, and investment management, including corporate reorganization, with a particular focus on technology and software companies.
William G. Wesemann, 69, has served as a member of the Board since November 2004. Mr. Wesemann brings experience as an executive, board member and investor in various technology companies. Mr. Wesemann has been an independent consultant and an independent investor since 2002 in the software and consumer services industries. In addition to his role as a member of the Board, Mr. Wesemann has served on the board of directors of Aclarion, Inc. (NASDAQ: ACON), a medical SAAS company that listed on Nasdaq in 2022, since 2014 and has served as its Lead Independent Director since 2022. He also serves on the boards of directors of several privately-held companies, including Stationhead, Inc., a social audio company, and Mylio, LLC, a photo management company. From March 2016 until January 2019, Mr. Wesemann was CEO of LARC Networks Inc., a communication, security and privacy technology developer. Earlier in his career, Mr. Wesemann was CEO of NextPage, Inc., a provider of document management systems, CEO of netLens Inc., a peer-to-peer platform for creating distributed applications that was acquired by NextPage, and SVP Worldwide Sales of Genesys Telecommunications Laboratories, Inc., a leader in computer-telephony integration, through a successful IPO. Prior to that, he was EVP Global Sales for NeXT Computer Inc. Mr. Wesemann earned a B.A. degree from Glassboro State College (now called Rowan University).
3
Mr. Wesemann brings to the Board notable technology, software and sales experience, in addition to extensive CEO, management and board experience at public and private software and technology companies.
Anthony Zingale, 70, has served as a member of the Board since July 2025. Mr. Zingale previously served as Executive Chairman of Jive Software, Inc., a pioneer of social collaboration and communication, from January 2015 until June 2017, where he also served as CEO from January 2010 until December 2014. Prior to Jive Software, Inc., he served as the President and Chief Executive Officer of Mercury Interactive Corporation, a business technology optimization company, from 2004 until its merger with Hewlett Packard at the end of 2006. Prior to Mercury Interactive Corporation, Mr. Zingale served as President and Chief Executive Officer of Clarify, Inc., a customer relationship management company, from 1998 until its acquisition in 2001. Currently, Mr. Zingale serves on the board of directors of ON24, Inc. (NYSE: ONTF), an AI-powered webinar and engagement platform. Mr. Zingale served on the board of directors of Carbon Black, Inc., a public cybersecurity company, from December 2015 to December 2019. Mr. Zingale holds a BS in Electrical and Computer Engineering and a BA in Business Administration from the University of Cincinnati.
Mr. Zingale brings to the Board over two decades of leadership experience in enterprise software, technology optimization and customer relationship management across both public and private companies.
The following is a brief biographical summary of the experience of the executive officers of LivePerson, including their ages as of April 30, 2026.
| Name | Age | Position(s) | ||||||||||||
| John Sabino | 53 | Chief Executive Officer | ||||||||||||
| John D. Collins | 44 | Chief Financial Officer and Chief Operating Officer | ||||||||||||
| Monica L. Greenberg | 57 | Chief Legal and Administrative Officer | ||||||||||||
| Christopher Mina | 42 | Chief Technology & Product Officer | ||||||||||||
John Sabino’s biography can be found above in this Amendment and is included with the biographies of the other members of the Board. Biographies for our other executive officers are listed below.
John D. Collins has served as our Chief Financial Officer (“CFO”) since February 2020 and our Chief Operating Officer (“COO”) since January 2024. He also served as our Interim Chief Executive Officer from August 2023 to January 2024. Drawing on his experience as a founder, data scientist, and institutional investor, John brings a modern vision and skillset to his work. As CFO, he has played a critical role in driving LivePerson’s corporate strategy and business development efforts, including successfully executing M&A, divestiture, and capital markets transactions. Mr. Collins joined LivePerson in September 2019 to lead the development of automations and machine learning to support strategic decision making and predictive analytics as SVP of Quantitative Strategy. In 2013, Mr. Collins co-founded Thasos, a New York City-based predictive intelligence company powering large-scale equity trading platforms. Mr. Collins served in various capacities at Thasos, including, most recently, as an Advisory Board Member, as its Chief Product Officer (2016 - 2019) and as its Portfolio Manager (2013 - 2016). Prior to that, Mr. Collins held roles in the financial services industry, including regulating financial firms at the NYSE, and structuring transactions in leveraged finance at Credit Suisse. Mr. Collins earned his J.D. from Chicago-Kent College of Law at Illinois Institute of Technology, his M.B.A. from the Massachusetts Institute of Technology, and his B.S. from the University of Central Florida.
Monica L. Greenberg has served as our Chief Legal and Administrative Officer since September 2025, our Executive Vice President, Policy, General Counsel and Head of People from August 2023 to September 2025, our Executive Vice President, Policy and General Counsel from April 2019 to August 2023 (concurrently serving as Head of People Operations from January 2020 to December 2020), our Executive Vice President, Corporate Development, Strategic Alliances and General Counsel from December 2017 to April 2019, our Executive Vice President, Business Affairs and General Counsel from February 2014 to December 2017 and our Senior Vice President, Business Affairs and General Counsel from November 2006 to February 2014. From May 2004 until October 2006, Ms. Greenberg was an
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independent consultant. From April 2000 until April 2004, Ms. Greenberg served as Vice President, General Counsel and Senior Corporate Counsel of Nuance Communications, Inc. Previously, from January 1999 to March 2000, Ms. Greenberg was the principal of a small business. From July 1996 to December 1998, Ms. Greenberg was associated with the law firm of Wilson Sonsini Goodrich & Rosati in Palo Alto, California. From September 1994 to July 1996, Ms. Greenberg was associated with the law firm of Willkie Farr & Gallagher in New York, New York. Ms. Greenberg earned her J.D. from Boston University School of Law, where she was a member of the Boston University Law Review, and a B.A. from the University of Pennsylvania.
Christopher Mina has served as our Chief Technology & Product Officer since January 2025 and previously served as our VP of Engineering from April 2021 to September 2022. Mr. Mina leads LivePerson’s product, engineering, and AI organization, guiding the company’s product strategy and operational excellence. With an extensive background leading global enterprise brands through technical and product transformations at scale in the SaaS, CCaaS, and Conversational AI, Mr. Mina is uniquely qualified to drive LivePerson’s technology forward and deliver high-quality, reliable, and trusted enterprise software for LivePerson’s customers.
Mr. Mina comes to LivePerson from Vonage, where he guided product, business strategy, and execution for the Global Apps business, which included UCaaS, CCaaS, and Conversational AI. Before that, Mina was Head of Voice and VP of Product and Engineering at LivePerson where he led LivePerson’s voice initiatives, including the acquisition of Tenfold, Voicebase, AI Foundation, and delivered Voice AI. Prior to that, he held leadership roles at RingCentral and several startups.
Mr. Mina is based in Saratoga Springs, NY, and earned a BS in Biomedical Engineering from Lehigh University.
Audit Committee
The Audit Committee appoints our independent registered public accounting firm, reviews the plan for and the results of the independent audit, approves the fees of our independent registered public accounting firm, reviews with management and the independent registered public accounting firm our quarterly and annual financial statements and our internal accounting, financial and disclosure controls, reviews and approves transactions between LivePerson and its officers, directors and affiliates, oversees whistleblower procedures, and performs other duties and responsibilities as set forth in a charter approved by the Board. The charter of the Audit Committee is available at https://ir.liveperson.com/corporate-governance/governance-overview. Each member of the Audit Committee is independent, as “independence” is defined for purposes of Audit Committee membership by the listing standards of Nasdaq and the applicable rules and regulations of the SEC. The Audit Committee held four meetings during the 2025 Fiscal Year. The Company’s website address provided above is not intended to function as a hyperlink, and the information on the Company’s website is not and should not be considered part of this Amendment and is not incorporated by reference herein.
The members of the Audit Committee of our Board during the 2025 Fiscal Year were Ms. Tjon (Chair), Mr. Fletcher, Ms. Jill Layfield (prior to her resignation from the Board), Mr. Miller (following Ms. Layfield’s departure) and Mr. Wesemann. On January 22, 2026, the Board appointed Mr. Lane to serve on the Audit Committee as well.
The Board has determined that each member of the Audit Committee is able to read and understand fundamental financial statements, including LivePerson’s balance sheet, income statement and cash flow statement, as required by Nasdaq rules. In addition, the Board has determined that Ms. Tjon satisfies the Nasdaq rule requiring that at least one member of our Board’s Audit Committee have past employment experience in finance or accounting, requisite professional certification in accounting or any other comparable experience or background which results in the member’s financial sophistication, including being, or having been, a chief executive officer, chief financial officer or other senior officer with financial oversight responsibilities. The Board has also determined that Ms. Tjon is the Audit Committee’s “audit committee financial expert” as defined by the SEC.
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Corporate Governance Guidelines and Code of Business Conduct and Ethics
The Company monitors developments in the area of corporate governance and routinely reviews its processes and procedures in light of such developments and in response to investor feedback. Accordingly, the Company reviews federal laws affecting corporate governance as well as various rules promulgated by the SEC and Nasdaq. The Company believes that it has procedures and practices in place which are designed to enhance and protect the interests of its stockholders.
The Board has adopted Corporate Governance Guidelines that address items such as the qualifications and responsibilities of our directors and director candidates, corporate governance policies, and standards applicable to us in general. In addition, the Board has adopted a Code of Conduct applicable to all of our employees, including our executive officers, and our non-employee directors, as well as a Code of Ethics for the Chief Executive Officer and Senior Financial Officers. The Code of Conduct and Code of Ethics can be found at https://ir.liveperson.com/corporate-governance/governance-overview. Disclosures of any amendments to, or waivers under, the Code of Ethics for the Chief Executive Officer and Senior Financial Officers will be made on our website, www.liveperson.com.
The charters of our Board’s Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee, and LivePerson’s current Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws, can be accessed at https://ir.liveperson.com/corporate-governance/governance-overview. Copies may also be obtained at no charge by writing to LivePerson, Inc., 530 7th Avenue, Floor M1, New York, New York 10018, Attention: Investor Relations.
The Company’s website addresses provided above are not intended to function as hyperlinks, and the information on the Company’s website is not and should not be considered part of this Amendment and is not incorporated by reference herein.
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Item 11. Executive Compensation
As a smaller reporting company, the Company has opted to comply with the SEC’s executive compensation disclosure rules applicable to “smaller reporting companies,” as such term is defined under the Securities Act of 1933, as amended. Those rules require compensation disclosure only for the Company’s principal executive officer and its next two most highly compensated executive officers (other than the principal executive officer) who were serving as an executive officer at the end of 2025.
The tabular disclosure and discussion that follow describe the Company’s executive compensation program during the fiscal years ended December 31, 2025 and 2024 with respect to the Company’s named executive officers for 2025:
•John Sabino, our CEO;
•John D. Collins, our COO and CFO, and former Interim CEO; and
•Christopher Mina, our Chief Technology & Product Officer.
2025 Summary Compensation Table
The following table sets forth the compensation earned for all services rendered to the Company in all capacities in each of the last two fiscal years, by our NEOs. Following the table is a discussion of material factors related to the information disclosed in the table.
| Name and Principal Position | Year | Salary ($) | Bonus ($)(1) | Stock Awards ($)(2) | Option Awards ($) | Non-Equity Incentive Plan Compensation ($)(3) | All Other Compensation ($)(4) | Total ($) | |||||||||||||||||||||
John Sabino Chief Executive Officer | 2025 | 550,000 | — | 280,800 | — | 176,000 | 32,237 | 1,039,037 | |||||||||||||||||||||
| 2024 | 535,545 | — | 3,421,936 | 169,000 | 165,000 | 27,798 | 4,319,279 | ||||||||||||||||||||||
John D. Collins Chief Financial Officer and Chief Operating Officer | 2025 | 525,000 | 50,000 | 863,956 | — | 109,200 | 40,558 | 1,588,714 | |||||||||||||||||||||
| 2024 | 525,000 | 575,000 | 890,400 | — | 97,125 | 40,334 | 2,127,859 | ||||||||||||||||||||||
Christopher Mina Chief Technology and Product Officer | 2025 | 437,500 | — | 1,023,379 | — | 71,000 | 128,491 | 1,660,370 | |||||||||||||||||||||
(1)Represents the second payment of a $100,000 retention bonus awarded to Mr. Collins in September 2024. The second payment vested on June 15, 2025.
(2)The amounts reported in the “Stock Awards” column represent the grant date fair value of RSU awards granted to our NEOs in 2025 computed in accordance with Financial Accounting Standards Board’s Accounting Standards Codification Topic 718, or ASC Topic 718, and in accordance with SEC rules. Details and assumptions used in calculating the grant date fair value of the RSU awards may be found in Note 11 of the Company’s consolidated financial statements contained in our Annual Report on Form 10-K for the 2025 Fiscal Year, as filed with the SEC. The amounts included in this column reflect the Company’s accounting expense and do not correspond to the actual value that will be realized, and there is no assurance that these grant date fair values will ever be realized. Pursuant to SEC rules, the amounts shown exclude the impact of estimated forfeitures related to service-based vesting conditions.
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(3)Represents the performance-based, annual incentive bonuses in respect of 2025 performance, as described in the section of this Amendment titled “Narrative Disclosure to 2025 Summary Compensation Table - Annual Incentive Compensation” below.
(4)Amounts reported include: (i) $720, $720 and $630 for Mr. Sabino, Mr. Collins, and Mr. Mina, respectively, for premiums for term life insurance, (ii) $9,750, $14,000, and $14,000 for Mr. Sabino, Mr. Collins, and Mr. Mina, respectively, for matching contributions to our 401(k) plan, (iii) $21,857, $25,838, and $25,838 for Mr. Sabino, Mr. Collins, and Mr. Mina, respectively, for health, dental, vision and disability insurance, and (iv) for Mr. Mina, $50,000 for relocation expenses and $38,023 in relocation-related tax assistance.
Narrative Disclosure to 2025 Summary Compensation Table
Elements of 2025 Compensation
The philosophy underlying our executive compensation program is to employ and retain the best leaders in our industry to ensure we execute on our business goals, to reward both individual and company performance in order to promote growth and profitability, and to effectively create long-term stockholder value. In order to achieve our compensation objectives and to support our strategy and compensation philosophy, our compensation program for the 2025 Fiscal Year was designed to include the principal pay elements described further below. In accordance with our executive compensation philosophy, a significant portion of our NEOs’ target pay is incentive-based, and therefore is considered “at-risk.” This approach directly aligns each NEO’s interests with those of our stockholders during periods of both share price growth and share price pressure. Based on the elements of compensation described in the narrative below, approximately 40% of Mr. Sabino’s 2025 annual compensation opportunity (assuming target performance) stems from “fixed” pay elements (i.e., base salary) while 60% is connected to a form of “at-risk” compensation (i.e., target annual bonus and equity compensation).
Base Salaries
The Compensation Committee believes that our executive base salaries should reflect competitive levels of pay and factors unique to each executive such as experience and breadth of responsibilities, performance, individual skill set, time in the role and internal pay parity. Base salaries are initially set forth in our NEO’s executive’s employment agreement or offer letter, and reviewed periodically. Salary adjustments, if any, for the NEOs are approved by the Compensation Committee. The annual base salaries for Mr. Sabino and Mr. Collins were not adjusted in 2025. Mr. Mina’s base salary of $425,000 was increased, as of October 15, 2025, to $500,000 in consideration of competitive market data and in response to Mr. Mina’s performance since the commencement of his employment.
Annual Incentive Compensation
Our NEOs are provided the opportunity to earn a performance-based annual bonus. The annual bonus plan is designed to provide awards to such individuals as an incentive to contribute to and reward achievement against pre-established financial-based metrics. The Compensation Committee annually selects specific performance metrics to motivate performance that enhances and supports our strategic corporate objectives consistent with our annual operating plan.
Target annual bonus opportunities are expressed as a percentage of annual base salary and were established by the Compensation Committee in consideration of the NEO’s level of responsibility and his or her ability to impact overall results. The Compensation Committee also periodically considers competitive market analysis prepared by Compensia in setting target bonus amounts.
For the 2025 Fiscal Year, the target annual bonus opportunities for our NEOs are set forth in the table below, expressed both as a percentage of base salary and as a dollar amount. The target annual bonus opportunity percentages were
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unchanged from the prior year for Mr. Sabino and Mr. Collins, and set at 50% of base salary for Mr. Mina as part of his hiring.
| NEO | Target Bonus as a % of Salary | Target Bonus ($) | |||||||||
| John Sabino | 100% | 550,000 | |||||||||
| John D. Collins | 65% | 341,250 | |||||||||
| Christopher Mina | 50% | 221,875 | (1) | ||||||||
(1) Target bonus amount reflects salary adjustment in October 2025.
Annual bonus payouts for the 2025 calendar year were based on the level of achievement of the performance goals established by the Compensation Committee in consultation with our CEO and CFO, which level of performance was applied to the aggregate funding pool established by the Compensation Committee at the beginning of 2025 and then allocated to all eligible annual bonus participants. In designing the 2025 annual bonus program, the Compensation Committee sought to align the goals with investor interests, choosing B2B Recurring Revenue (weighted 30%), B2B New Annual Recurring Revenue (weighted 30%) and B2B Core Free Cash Flow (weighted 40%) as the relevant operational and financial performance metrics since success across those measures drives business operations and are key to positively impacting shareholder value. Corporate achievement at or between the approved threshold and target achievement levels of each goal resulted in funding the aggregate bonus pool based on a pre-determined scale set by the Compensation Committee. Following the end of the fiscal year, the Compensation Committee assessed performance against the established targets to have been achieved at 40%. The Compensation Committee, in consultation with management and in consideration of fiscal management goals and prior year performance, had approved, at the beginning of 2025, a reduced bonus pool target funding level, with Committee discretion to increase the available pool based on actual Company performance. The final payout percentage approved by the Committee for the 2025 fiscal year, based on Company performance together with the predetermined bonus pool funding level and the allocations across all annual bonus plan participants, resulted in participant payouts of approximately 32% of each participant’s target bonus opportunity.
The table below summarizes the performance metrics, weightings, goals and achievement levels with respect to the 2025 annual bonus program:
| Goal | Weighting | Goals Threshold / Target (in millions of $) | Achievement Level (in millions of $) | Pool Funding Level | ||||||||||
2025 B2B Recurring Revenue(1) | 30% | 235.66 / 244 | Below threshold | — | ||||||||||
2025 B2B New Annual Recurring Revenue(2) | 30% | (15.3) / 0 | Below threshold | — | ||||||||||
2025 B2B Free Cash Flow(3) | 40% | (20.4) / (15) | (15) | 40% | ||||||||||
(1)“2025 B2B Recurring Revenue” means aggregate 2025 Fiscal Year recurring software revenue and recurring professional services revenue.
(2)“2025 B2B New Annual Recurring Revenue” means annual new recurring software revenue and annual new recurring professional services revenue, net of churn, in the 2025 Fiscal Year.
(3)“2025 B2B Free Cash Flow” means Adjusted EBITDA less capitalized software and other capital purchases in the 2025 Fiscal Year. “Adjusted EBITDA” means net loss, before provision for (benefit from) income taxes, interest income (expense), net, other income (expense), net, depreciation and amortization, stock-based compensation, restructuring costs, transaction-based acquisition costs, contingent earn-out adjustments and other non-cash charges.
The Compensation Committee has the authority to, but did not revise any NEO bonus amounts in respect of 2025 based on individual performance or performance measured against any strategic objectives, and, therefore, the annual bonus amounts for those bonus-eligible NEOs reflect the Company’s performance against the metrics described above as
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applied to the final determined aggregate bonus pool. The table below sets forth the earned bonus amounts for each NEO for 2025, which were paid in cash:
| NEO | Earned Bonus ($) | Earned Bonus (as a % of Target) | ||||||
| John Sabino | 176,000 | 32% | ||||||
| John D. Collins | 109,200 | 32% | ||||||
| Christopher Mina | 71,000 | 32% | ||||||
Equity-Based Awards
Equity-based awards are an important element for aligning the long-term financial interests of our NEOs and our stockholders. The Compensation Committee may grant equity-based awards under the Company’s Amended and Restated 2019 Stock Incentive Plan (the “2019 Stock Incentive Plan”), or the Company’s Amended and Restated Inducement Plan (as defined below), in the case of new-hire awards) in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares and other equity-based awards.
For equity awards granted in the 2025 Fiscal Year, the Compensation Committee considered multiple factors, including (i) retention of key personnel across the employee base to maintain institutional knowledge and execute on operational goals; (ii) share pool constraints in the 2019 Stock Incentive Plan, (iii) the potential dilutive effects of equity awards upon vesting or exercise, (iv) the desire to provide market-competitive equity awards to employees based , in part on the status and retention value of awards previously granted to an employee, (v) the performance of the Company’s stock price, (vi) competitive market analysis performed by Compensia, and (vii) the recommendations of the CEO (except with respect to his own equity compensation).
In consideration of the foregoing, (i) in May 2025 and September 2025, the Compensation Committee awarded grants of RSUs to Mr. Collins in respect of 19,711 and 46,955 shares, respectively, each of which vest on the first anniversary of the date of grant; and (ii) in December 2025, the Compensation Committee awarded RSUs to Mr. Sabino in respect of 60,000 shares, 35% of which vest on September 15, 2026 and 65% of which vest on September 15, 2027. In addition, Mr. Mina received a sign-on equity award as an inducement to his accepting an offer of employment as the Company’s Chief Technology and Product Officer, effective as of January 1, 2025, consisting of 33,333 RSUs that vest on the first two anniversaries of the date of grant. The number of shares above subject to the grants in 2025, as described above, are in each instance being reported on a post-reverse split basis to reflect the 1 to 15 share reverse split of the Company’s shares that occurred on October 15, 2025.
The Role of Compensation Consultant, Competitive Pay Positioning and 2025 Benchmarking
The Compensation Committee, composed of independent, non-employee members of the Board, oversees the executive compensation program for our NEOs and determines NEO pay levels. The Compensation Committee works closely with an independent compensation consultant, Compensia, to design, review and evaluate compensation programs and pay mix for our NEOs. The Committee also seeks the input of management to examine the effectiveness of the Company’s executive compensation program throughout the year. The Compensation Committee reviews executive compensation and market and peer compensation data periodically, in conjunction with annual operational and financial planning for the current fiscal year and as needed for specific executive compensation issues that may arise at other times. The Compensation Committee makes final determinations regarding compensation for the CEO and our other executive officers in its sole discretion.
In determining the pay levels, the Compensation Committee considers all forms of compensation and benefits. As part of the compensation-setting process for the 2025 Fiscal Year, the Compensation Committee reviewed market data developed by Compensia covering peer and broader tech company practices sourced from SEC filings and broader market surveys to evaluate compensation levels and practices for the NEOs. After consideration of the data collected on
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external competitive levels of compensation and internal relationships within the executive group, the Compensation Committee reviewed and approved the 2025 Fiscal Year target total compensation opportunities for executives based on the need to attract, motivate and retain an experienced and effective management team.
Pay levels for each of our NEOs are determined based on a number of factors, including the individual’s roles and responsibilities within the Company, the individual’s experience and expertise, the pay levels for peers within the Company, pay levels in the broader technology company marketplace for similar positions, performance of the individual and the Company as a whole, and the Company’s overall cash and equity compensation budgets.
As noted above, notwithstanding the Company’s overall pay positioning objectives, pay opportunities for specific individuals vary based on several factors such as scope of duties, tenure, institutional knowledge and/or difficulty in recruiting a new executive. Given that a significant portion of our compensation consists of variable, at-risk elements, actual total compensation in a given year will vary above or below the target compensation levels based primarily on the attainment of operational and financial goals and the creation of stockholder value. For purposes of setting compensation for the 2025 Fiscal Year, the Compensation Committee utilized a compensation peer group consisting of the companies listed below. The 2025 Fiscal Year peer group was updated from the peer group utilized for compensation determinations in the prior year. In developing an appropriate comparator group, the following criteria served as key drivers: public company status, U.S.-based headquarters, industry (inclusive of business scope and business mix), size (market capitalization and revenue), and number of employees. In addition, the Compensation Committee considered whether potential peer group members were identified as labor market competitors of ours as well as included in the peer group identified by Institutional Shareholder Services. The Compensation Committee works with Compensia periodically to determine if any adjustments to the peer group are appropriate.
| Amplitude, Inc. | 8x8, Inc. | Porch Group, Inc. | ||||||
| Bandwith, Inc. | Fastly, Inc. | PROS Holdings Inc. | ||||||
| Cerence, Inc. | Model N, Inc. | Rimini Street, inc. | ||||||
| Commerce.com, Inc. (f/k/a Big Commerce Holdings, Inc.) | Olo Inc. | Synchronoss Technologies, Inc. | ||||||
| Consensus Cloud Solutions, Inc. | ON24 inc | Upland Software, Inc. | ||||||
| Digital Turbine, Inc. | OneSpan Inc. | Yext, Inc. | ||||||
| Domo, Inc. | Ooma Inc. | Zuora Inc. | ||||||
Health and Welfare Benefits
We do not offer special perquisites to our NEOs. The Company’s executive compensation program includes standard benefits that are also offered to all employees. These benefits include participation in the Company’s 401(k) plan, including Company matching contributions, and Company-paid medical benefits and life insurance coverage. The Company annually reviews these benefits and makes adjustments as warranted based on competitive practices, the Company’s performance and the individual’s responsibilities and performance. The Company’s 401(k) plan is a safe harbor plan and, in accordance with IRS rules, the Company matches 100% of the first 3% of eligible compensation and 50% of the next 2% of eligible compensation, subject to IRS limitations.
Additional Narrative Disclosure
In 2015, the Compensation Committee adopted the Deferred Compensation Plan. Certain key employees of the Company, including our NEOs and members of our Board, are eligible to participate in the Deferred Compensation Plan and generally may elect to defer the receipt of a portion of their base salary, bonus and/or directors’ fees. Distribution may occur upon the following events, depending upon the participant’s deferral election: a specified time, a separation from service, death, disability, change in control or financial hardship that arises in connection with an unforeseeable emergency. To date, none of our current NEOs have elected to make any deferrals under the Deferred Compensation Plan. The Company may make discretionary or matching contributions to the Deferred Compensation Plan, which may or may not be subject to vesting, but has not done so to date.
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Employment Agreements for our Named Executive Officers
John Sabino, our CEO, became our CEO on January 10, 2024. Prior to the commencement of his employment, we entered into an employment agreement with Mr. Sabino setting forth the terms and conditions of his service as our CEO. Mr. Sabino’s employment agreement provides that he will receive an annual base salary of $550,000, and he will be eligible to receive an annual bonus, with a target bonus opportunity of 100% of his base salary. In connection with his commencement of employment, Mr. Sabino received inducement awards, including: (i) two RSU awards, one with a target grant date value of $1,200,000 that will vest in two equal installments on the first two anniversaries of the date of grant, and the second with a target grant date value of $4,000,000 that will vest as to 25% of the number of RSUs on the first anniversary of the date of grant and then in 12 substantially equal quarterly installments, and (ii) the Sign-on Option, which is a stock option to acquire 66,666 (reflecting adjustment in light of the reverse stock split) shares of the Company’s common stock that will vest and become exercisable upon satisfaction of certain performance-based and time-based vesting conditions. The Sign-on Option’s performance-based vesting conditions provide that 50% of the Sign-on Option will be eligible to vest and become exercisable if, within the first three years following the date of grant, the average closing share price of the Company’s common stock reaches $120.00 (reflecting adjustment in light of the reverse stock split) on a rolling 30-day trading basis, and the remaining 50% of the Sign-on Option will be eligible to vest and become exercisable if, within the first four years following the date of grant, the average closing share price of the Company’s common stock reaches $195.00 (reflecting adjustment in light of the reverse stock split) on a rolling 30-day trading basis. In addition, to the extent that the performance-based vesting conditions are met, 50% of the Sign-on Option will vest and become exercisable on the second anniversary of the date of grant, and the remaining portion of the Sign-on Option will vest and become exercisable in 24 substantially equal monthly installments following the second anniversary of the date of grant. Mr. Sabino’s employment agreement provides for certain payments upon termination. Please refer to the section of this Amendment titled “Potential Payments Upon Termination or Change in Control” below for a description of those termination payments.
John D. Collins, our COO and CFO, and former Interim CEO, is party to an employment agreement with us, dated as of August 9, 2022 and amended effective May 1, 2024, which covers the terms and conditions of Mr. Collins’ employment including his eligibility to participate in the Company’s annual bonus plan as it exists from time to time under terms comparable to other employees of similar role and responsibility, and standard Company employee benefits, including vacation, in accordance with the terms of those programs in effect from time to time. Mr. Collins’ employment agreement provides for certain payments upon termination. Please refer to the section of this Amendment titled “Potential Payments Upon Termination or Change in Control” below for a description of those termination payments.
Christopher Mina, our Chief Technology and Product Officer, is party to an employment agreement with us, dated as of November 27, 2024, and amended as of October 23, 2025, which covers the terms and conditions of Mr. Mina’s employment including his eligibility to participate in the Company’s annual bonus plan as it exists from time to time under terms comparable to other employees of similar role and responsibility, and standard Company employee benefits, including vacation, in accordance with the terms of those programs in effect from time to time. In connection with his hiring, Mr. Mina was entitled to payment or reimbursement by the Company of certain relocation and related tax planning expenses related to Mr. Mina’s relocation from abroad, subject to applicable taxes. The relocation-related payments are subject to repayment by Mr. Mina if he were to voluntarily terminate his employment within two years of his relocation. In addition, as part of the amendment of Mr. Mina’s employment agreement, Mr. Mina became eligible for a $250,000 transaction-based retention bonus that becomes vested and payable, subject to applicable tax, upon the closing of a change of control of the Company occurring within two years of the date of the amendment. Mr. Mina’s employment agreement, as amended, also provides for certain payments upon termination. Please refer to the section of this Amendment titled “Potential Payments Upon Termination or Change in Control” below for a description of those termination payments.
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Outstanding Equity Awards at End of 2025 Fiscal Year
The following table sets forth information concerning outstanding equity awards held by each of the NEOs as of the end of the 2025 Fiscal Year. In the table below, all share numbers and exercise prices, as applicable, in respect of awards that were outstanding as of October 13, 2025 reflect adjustments made in light of the 1 to 15 reverse-stock split of the Company’s shares that occurred on that date. Any awards granted after that date are included based on the actual number of shares granted (on a post-reverse split basis).
| Option Awards | Stock Awards | |||||||||||||||||||||||||||||||
| Vesting Commencement Date | Number of Securities Underlying Unexercised Options Exercisable (#) | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) (1) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) (2) | Market Value of Shares or Units of Stock That Have Not Vested ($) (3) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) (4) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (3) | ||||||||||||||||||||||||
| John Sabino | 3/15/2024 | — | 66,666 | 15.30 | 3/15/2034 | — | — | — | — | |||||||||||||||||||||||
| 3/15/2024 | — | — | — | — | 122,581 | 474,388 | — | — | ||||||||||||||||||||||||
| 12/1/2025 | — | — | — | — | 60,000 | 232,200 | — | — | ||||||||||||||||||||||||
| John D. Collins | 10/29/2019 | 1,854 | — | 609.15 | 10/29/2029 | — | — | — | — | |||||||||||||||||||||||
| 4/16/2020 | 2,474 | — | 410.85 | 5/15/2030 | — | — | — | — | ||||||||||||||||||||||||
| 4/9/2021 | 1,932 | — | 776.10 | 5/7/2031 | — | — | — | — | ||||||||||||||||||||||||
| 7/27/2022 | — | — | — | — | 2,905 | 11,242 | — | — | ||||||||||||||||||||||||
| 7/27/2022 | — | — | — | — | — | — | 1,851 | 7,163 | ||||||||||||||||||||||||
| 5/15/2025 | — | — | — | — | 19,711 | 76,282 | — | — | ||||||||||||||||||||||||
| 9/15/2025 | — | — | — | — | 46,955 | 181,716 | — | — | ||||||||||||||||||||||||
| Christopher Mina | 1/15/2025 | — | — | — | — | 33,333 | 128,999 | — | — | |||||||||||||||||||||||
| 9/15/2025 | — | — | — | — | 26,333 | 101,909 | — | — | ||||||||||||||||||||||||
(1)In connection with his hiring, Mr. Sabino was granted a stock option to acquire 1,000,000 shares (66,666 shares on a post-reverse split basis) of the Company’s common stock that will vest upon satisfaction of certain performance-based and time-based vesting conditions as further described above in the section of this Amendment titled “Narrative Disclosure to Summary Compensation Table – Employment Agreements for our Named Executive Officers.”
(2)For RSU awards granted prior to 2024, the total original number of shares subject to each RSU award listed in this column vests over four years, with 25% of the units vesting on the first anniversary of the vesting commencement date and the balance vesting in equal annual installments on each anniversary thereof. For RSU awards granted in 2024 and 2025 to Mr. Collins and Ms. Greenberg, the total original number of shares subject to each RSU listed in this column become vested in full upon the first anniversary of the vesting commencement date. For Mr. Sabino, 774,194 shares (51,612 shares on a post-reverse split basis) of the original number of shares subject to his RSU awards vest in two equal installments on the first two anniversaries of the grant date (i.e., March 15, 2025 and March 15, 2026), and 2,580,645 (172,043 on a post-reverse split basis) of the original number of shares subject to his RSU award vest as to 25% of the award on the first anniversary of the grant date and then in 12 substantially equal quarterly installments thereafter.Mr. Sabino’s 2025 RSU award vests as to 35% of the number of shares originally granted on September 15, 2026, and 65% of the number of shares originally granted on September 15, 2027. For all outstanding RSU awards, vesting is subject to the executive’s continued employment through the vesting date, except as may be provided in their individual employment agreements.
(3)The market value of RSUs is based on the closing market price of the Company’s common stock on December 31, 2025 of $3.87 per share.
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(4)Amounts reported in this column represent performance-vesting restricted stock units (“PRSUs”) granted in 2022 which were earned and vested based on the achievement of certain company performance goals, including the Company’s revenue and adjusted EBITDA achievement and relative total shareholder return (“TSR”) performance, over a three-year performance period that ended in July 2025. The final number of PRSUs as shown were deemed earned following the end of the performance period on July 27, 2025.
Potential Payments Upon Termination or Change in Control
The following narrative disclosure describes the additional compensation that would have become payable to certain of our NEOs in connection with an involuntary termination of their employment or a change in control of the Company pursuant to the agreements entered into with our NEOs and the terms of their outstanding equity awards.
John Sabino
If Mr. Sabino is terminated by us without Cause or if he resigns for Good Reason (as such terms are defined in his employment agreement), then, subject to his execution of a general release of claims in favor of the Company, he will be entitled to the following severance: (i) continued payment of his base salary for 18 months, (ii) an amount equal to Mr. Sabino’s target annual bonus opportunity for the year of termination, which will be prorated based on the number of days worked during the year of termination, unless the relevant termination event occurs within the three months prior to or during the 12 months following a Change in Control (in which case, the amount will not be prorated), (iii) if the prior year’s annual bonus has been earned but not yet paid at the time of termination, payout of the annual bonus amount that would have been paid in the normal course had the termination of employment not occurred, (iv) reimbursement for the differential cost of continuation of his then-current health insurance benefits for Mr. Sabino and his covered dependents under COBRA (provided Mr. Sabino timely elects COBRA) for a period of 18 months, and (v) if the relevant termination event occurs during the three months prior to or during the 12 months following a Change in Control, (A) all time-based equity awards outstanding as of the date of termination (including the Sign-on Awards, but excluding the Sign-on Option) will fully vest, and (B) the treatment of any performance-based equity awards will be determined in accordance with the terms of the applicable award’s grant agreement. In the case of the Sign-on Option, (x) any remaining time-based vesting conditions will be accelerated and deemed immediately satisfied for the portion of the award, if any, for which the performance-based vesting conditions were met prior to the Change in Control, (y) 50% of the performance-based vesting conditions will be deemed satisfied if the Change in Control per share transaction price is at least $120.00 per share, and any remaining time-based vesting conditions will accelerate for that portion of the Sign-on Option, and (z) 100% of the performance-based vesting conditions will be deemed satisfied if the Change in Control per share transaction price is at least $195.00 per share, and any remaining time-based vesting conditions will accelerate for that portion of the Sign-on Option. If neither of the performance-based vesting hurdles are met in the Change in Control transaction, the unvested portion of the Sign-on Option will be forfeited and cancelled for no consideration at the time of the Change in Control.
In the event of Mr. Sabino’s termination as a result of his death or, subject to execution of a general release of claims in favor of the Company, his Disability (as such term is defined in his employment agreement), the Company will pay to Mr. Sabino or his heirs, as applicable, an amount equal to the prior year’s annual bonus that had been earned but not yet paid at the time of Mr. Sabino’s death or Disability. In addition, Mr. Sabino or his heirs, as applicable, will be entitled to Company-paid health insurance continuation coverage, less the amount payable by an active employee for such coverage, for a period of 18 months. To the extent that any stock options held by Mr. Sabino are vested at the time of his death or Disability, those vested stock options will remain exercisable until the earlier of 12 months and the original expiration date of the stock option.
John D. Collins
If Mr. Collins is terminated by us without Cause (as defined in his employment agreement), subject to his execution of a general release of claims in favor of the Company, he will be entitled to the following severance: (i) continued payment of his base salary for six months, (ii) reimbursement for the differential cost of continuation of his then-current health
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insurance benefits under COBRA (provided Mr. Collins timely elects COBRA) for a period of six months, and (iii) any earned, but unpaid, annual bonus for a prior completed fiscal year.
In addition, if Mr. Collins’ employment is terminated by us without Cause or by Mr. Collins for Good Reason (as defined in his employment agreement), in either case, within the three-month period immediately prior to or the 12-month period immediately following a Change of Control (as defined in his employment agreement), then, subject to his execution of a general release of claims in favor of the Company, he will be entitled to the following severance: (i) continued payment of his base salary for 12 months, (ii) reimbursement for the differential cost of continuation of his then-current health insurance benefits under COBRA (provided Mr. Collins timely elects COBRA) for a period of 12 months, (iii) a bonus payment equal to his target bonus for the prior completed fiscal year (if not yet paid), (iv) a bonus payment equal to his target bonus prorated for the number of months Mr. Collins was employed during the then-current fiscal year prior to termination, (v) immediate vesting, as of the termination date, of any outstanding unvested options and any other unvested equity awards held by Mr. Collins at the time of termination, and (vi) any vested options will remain exercisable until the earlier of 90 days following his termination and the original expiration date of the applicable option.
Christopher Mina
If Mr. Mina is terminated by us without Cause (as defined in his employment agreement), subject to his execution of a general release of claims in favor of the Company, he will be entitled to the following severance: (i) continued payment of his base salary for six months, (ii) reimbursement for the differential cost of continuation of his then-current health insurance benefits under COBRA (provided Mr. Mina timely elects COBRA) for a period of six months, and (iii) any earned, but unpaid, annual bonus for a prior completed fiscal year.
In addition, if Mr. Mina’s employment is terminated by us without Cause or by Mr. Mina for Good Reason (as defined in his employment agreement), in either case, within the three-month period immediately prior to or the 12-month period immediately following a Change of Control (as defined in his employment agreement), then, subject to his execution of a general release of claims in favor of the Company, he will be entitled to the following severance: (i) continued payment of his base salary for 6 months, (ii) reimbursement for the differential cost of continuation of his then-current health insurance benefits under COBRA (provided Mr. Mina timely elects COBRA) for a period of 6 months, (iii) a bonus payment equal to his target bonus for the prior completed fiscal year (if not yet paid), (iv) immediate vesting, as of the termination date, of any outstanding unvested options and any other unvested equity awards held by Mr. Mina at the time of termination, and (v) any vested options will remain exercisable until the earlier of 90 days following his termination and the original expiration date of the applicable option.
Other Compensation Practices, Policies and Guidelines
Stock Ownership
We strongly encourage our executives and non-employee directors to hold an equity interest in our Company, and, accordingly, maintain formal executive stock ownership guidelines. Under these guidelines, each of our executive officers and non-employee directors is required to build and maintain their share ownership to the levels listed below within a period of five years from the adoption of the policy (April 2022), or the start of their service in a covered role, if later:
•CEO: 5x current base salary.
•Other NEOs: 2x current base salary.
•Non-employee directors: 5x annual cash retainer.
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Shares owned outright (including shares from vested RSUs and PRSUs) count toward the ownership goals, while shares associated with unvested RSUs, PRSUs and unexercised stock options do not count toward compliance with the guidelines. Compliance with the guidelines will be measured prior to the first required measurement date in 2027.
We believe that our stock ownership policy will contribute to the retention of shares from vested RSUs and PRSUs by our executive officers and non-employee directors. In the event that the ownership goals are not achieved within the applicable five-year compliance period, the non-employee directors and executive officers would be required to hold all net shares issued upon exercise of stock options or settlement of RSUs and PRSUs (in each case, after payment of any applicable withholding tax obligations) until the guidelines are met.
Compensation Recovery Policy
We maintain an amended and restated omnibus clawback policy (the “Clawback Policy”), effective as of October 2, 2023, which revised the prior clawback policy in order to comply with Exchange Act Rule 10D-1 and the applicable Nasdaq listing standards. Pursuant to the Clawback Policy, in the event of an “accounting restatement” (as defined in the Clawback Policy), our “covered executives” (as defined in the Clawback Policy), including our NEOs, must reimburse us for any “erroneously awarded compensation” (as defined in the Clawback Policy). Erroneously awarded compensation includes the amount of incentive compensation received by a covered executive during the three fiscal years preceding the date we are required to prepare an accounting restatement based on our achievement of “financial reporting measures” (as defined in the Clawback Policy) in excess of the amount that the covered executive would have received based on the restated financial reporting measures. The Compensation Committee has the authority to interpret and make all determinations under the Clawback Policy.
Prohibition Against Hedging and Certain Equity Transactions
Our Insider Trading and Disclosure Policy (the “Insider Trading Policy”) prohibits those officers subject to Section 16 reporting from engaging in hedging or derivative transactions, such as “cashless” collars, forward contracts, equity swaps or other similar or related transactions. In addition, all officers and employees of the Company and all the members of our Board are prohibited from engaging in “short” sales or other transactions involving LivePerson stock which could reasonably cause our officers to have interests adverse to our stockholders. “Short” sales, which are sales of shares of common stock by a person who does not own the shares at the time of the sale, evidence an expectation that the value of the shares will decline. We prohibit our executive officers from entering into “short” sales because such transactions signal to the market that the executive officer has no confidence in us or our short-term prospects and may reduce the officer’s incentive to improve our performance. In addition, Section 16(c) of the Exchange Act expressly prohibits executive officers and directors from engaging in short sales. Our executive officers are also prohibited from trading in LivePerson-based put and call option contracts, transacting in straddles and similar transactions without Board approval. These transactions would allow someone to continue to own the covered securities, but without the full risks and rewards of ownership. If an executive officer were to enter into such a transaction, the executive officer would no longer have the same objectives as our other stockholders. Under the Insider Trading Policy, all officers and employees of the Company, and all of the members of the Company’s Board are also prohibited from margining or pledging their common stock to secure a loan, or from purchasing Company stock “on margin” (that is, borrow funds to purchase stock, including in connection with exercising any Company stock options).
Policies and Practices Related to the Timing of Grants of Certain Equity Awards
The Compensation Committee may grant equity-based awards under the Company’s 2019 Stock Incentive Plan (or the Company’s Amended and Restated Inducement Plan (as defined below), in the case of new-hire awards) in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares and other equity-
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based awards. The Compensation Committee approves equity awards at one of its regularly scheduled meetings, or at such other times as appropriate or necessary, and generally, for annual equity awards, after the Compensation Committee has completed its annual compensation review for the CEO and other NEOs. The Compensation Committee has also delegated the authority to grant equity awards to certain non-executive officer employees to a sub-committee, which sub-committee generally meets to approve the applicable equity awards on or about the 15th day of each month. We do not schedule the grant of stock options or other equity awards in anticipation of the disclosure of material nonpublic information, and we do not schedule the disclosure of material nonpublic information based on the timing of grants of stock options or other equity awards.
Director Compensation
The following table sets forth information concerning the compensation of our non-employee directors in the 2025 Fiscal Year. Following the table is a discussion of material factors related to the information disclosed in the table.
| Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1)(2) | Option Awards ($)(1)(2) | Total ($) | ||||||||||
Dan Fletcher (3) | 52,500 | 215,995 | — | 268,495 | ||||||||||
Nathan “Tripp” Lane (3)(5) | 5,136 | 120,720 | — | 125,856 | ||||||||||
James Miller (3) | 108,333 | 215,995 | — | 324,328 | ||||||||||
Vanessa Pegueros(3) | 55,000 | 215,995 | — | 270,995 | ||||||||||
Karin-Joyce (K.J.) Tjon (3) | 68,614 | 215,995 | — | 284,609 | ||||||||||
Ryan Vardeman (3)(5) | 7,418 | 120,720 | — | 128,138 | ||||||||||
William G. Wesemann (3) | 50,000 | 215,995 | — | 265,995 | ||||||||||
Anthony Zingale (5) | 23,750 | — | 319,992 | 343,742 | ||||||||||
Bruce Hansen(3)(4) | 7,500 | — | — | 7,500 | ||||||||||
Jill Layfield (4) | 32,670 | — | — | 32,670 | ||||||||||
(1)In 2025, Mr. Fletcher, Mr. Miller, Ms. Pegueros, Ms. Tjon, and Mr. Wesemann received annual equity award in the form of RSUs, Mr. Zingale received a new director initial equity award in the form of a stock option to purchase shares of the Company’s common stock (“Options”), and Mr. Lane and Mr. Vardeman received new director initial equity awards in the form of RSUs.
(2)The amounts reported in the “Stock Awards” column represent the grant date fair value of RSU awards granted to our directors, other than Mr. Zingale, in 2025 and the amount reported in the “Option Awards” column represents the grant date fair value of the Options granted to Mr. Zingale in 2025, each computed in accordance with ASC Topic 718 and in accordance with SEC rules. Details and assumptions used in calculating the grant date fair value of the RSU awards and stock option award, as applicable, may be found in Note 11 of the Company’s consolidated financial statements contained in our Annual Report on Form 10-K for the 2025 Fiscal Year, as filed with the SEC. The amounts included in this column reflect the Company’s accounting expense and do not correspond to the actual value that will be realized by the non-employee directors, and there is no assurance that these grant date fair values will ever be realized by the directors. Pursuant to SEC rules, the amounts shown exclude the impact of estimated forfeitures related to service-based vesting conditions.
(3)As of December 31, 2025, the number of shares underlying outstanding and unvested RSUs include: (i) 13,333 for each of Mr. Fletcher, Mr. Miller, Ms. Pegueros, and Ms. Tjon, which vest on August 25, 2026 and represent the directors’ annual equity grant; and (ii) 23,350 for each of Mr. Lane and Mr. Vardeman, which vest on December 10, 2026 and represent initial new director awards. As of December 31, 2025, the number of shares underlying unexercised Options for non-employee directors were: Mr. Wesemann, 9,067, and Mr. Zingale, 26,666. The Options held by Mr. Zingale, which represents his initial new director award, will vest in three substantially equal installments on July 11, 2026, 2027 and 2028 and have an exercise price of $16.20. All of the share numbers, and the exercise price, as applicable, noted in this footnote attributable to RSU and Option awards held prior to October 13, 2025 reflect adjustments to the number of shares underlying the award and to the exercise price in the case of the Option to reflect the 1 to 15 reverse stock split that occurred on that date.
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(4)Mr. Hansen resigned from the Board effective January 31, 2025, and Ms. Layfield resigned from the Board effective August 4, 2025.
(5)Mr. Lane, Mr. Vardeman and Mr. Zingale were appointed to the Board on November 7, 2025, October 14, 2025, and July 11, 2025, respectively.
The non-employee directors are compensated in accordance with a fee schedule that is approved by the Compensation Committee, that generally operates on an annual cycle from July 1 to June 30 each year. Directors who are also our employees receive no additional compensation for their services as directors. The Compensation Committee reviews and recommends to the Board appropriate director compensation programs for service as non-employee directors including role-specific compensation for committee chair and committee member’s service. In order to determine the Board compensation framework, the Compensation Committee periodically reviews comparative market composite data of practices of the Company’s peers provided by Compensia.
Consistent with the Company’s compensation philosophy, non-employee director compensation is positioned competitively against companies of similar industry size and value, and is reviewed by the Compensation Committee periodically with changes, if any, generally being implemented for the next Board compensation cycle.
For his or her services in Fiscal Year 2025, each non-employee director received compensation in accordance with the following:
| Annual Cash Retainer | $ | 35,000 | ||||||
| Annual Cash Retainer for Chair of the Board | $ | 50,000 | ||||||
| Annual Equity Grant | $ | 200,000 | (1) | |||||
(1) Newly appointed non-employee directors to the Board receive an initial equity grant equal to the annual equity retainer of $200,000, the value of which may, in the Compensation Committee’s discretion, be prorated based on the timing of the new director’s commencement of service.
Members of our Committees, other than the Chairpersons, receive the following additional compensation (which is paid quarterly in arrears and prorated for any partial quarters of service):
| Audit Committee | $ | 10,000 | ||||||
| Compensation Committee | $ | 7,500 | ||||||
| Nominating and Corporate Governance Committee | $ | 5,000 | ||||||
The Chairpersons of our Committees receive the following additional compensation (which is paid quarterly in arrears and prorated for any partial quarters of service):
Audit Committee | $ | 20,000 | ||||||
Compensation Committee | $ | 15,000 | ||||||
| Nominating and Corporate Governance Committee | $ | 10,000 | ||||||
For the 2025 Fiscal Year, annual equity awards were granted in the form of RSUs. The RSUs will “cliff” vest on the one-year anniversary of the date of grant. The number of shares subject to the non-employee directors’ annual award was set at the time of our 2025 annual meeting of Stockholders held on June 25, 2025, at which time the non-employee directors agreed to receive a fixed number of shares (i.e., 13,333 shares on a post-reverse split basis), which at the time of approval represented a value less than the value of the Company’s standard non-employee director annual renewal grant. In connection with his joining the Board shortly after the annual meeting and in light of his specific experience and expertise and cooperative selection pursuant to our Company’s contractual obligation to Vector Capital Management, L.P., at the same time as the annual grants for continuing directors were approved, the Board approved an initial award for Mr. Zingale which, at his request, would be granted in the form of a stock option. The stock option, in respect of
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26,666 shares of the Company’s common stock, vests over three years in equal annual installments. At the time of the Compensation Committee’s approval, such stock option had an approximate Black-Scholes valuation generally aligned with the value of our non-employee director equity grants. These RSU and Option awards were subsequently granted in August 2025 promptly following the date on which the new share reserve, which received the approval of our stockholders at the 2025 Annual Meeting of Stockholders, was registered with the Securities and Exchange Commission on Form S-8. The values reported in the Director Compensation Table above reflect the grant date fair value of the awards as of the August 25, 2025 grant date in accordance with applicable accounting rules, and the exercise price of the Option is equal to the closing price of a share of our common stock on August 25, 2025. In connection with their appointments to the Board, Mr. Lane and Mr. Vardeman each received an initial grant in the form of RSUs that vest on the first anniversary of the date of grant, the grant value of which was prorated to reflect the partial year of service. Each of the awards were granted under the terms of the Company’s Amended and Restated Stock Incentive Plan (the “2019 Plan”) and within the sub-limits for awards to non-employee directors under the 2019 Plan, which for purposes of clarity, are per-director sub-limits.
Equity Compensation Plan Information
The following table summarizes the number of securities underlying outstanding options and RSUs granted to employees and directors, as well as the number of securities remaining available for future issuance, under LivePerson’s equity compensation awards as of December 31, 2025.
| Plan category | Number of securities to be issued upon exercise of outstanding options, warrants and rights as of December 31, 2025(1) (a) | Weighted-average exercise price of outstanding options, warrants and rights (2) (b) | Number of securities remaining available for future issuance under equity compensation plans as of December 31, 2025 (excluding securities reflected in column (a))(3) (c) | ||||||||
| Equity compensation plans approved by security holders | 830,873 | $278.59 | 155,001 | ||||||||
| Equity compensation plans not approved by security holders | 129,747 | $43.89 | 85,615 | ||||||||
| Total | 960,620 | 240,616 | |||||||||
(1)Consists of options to purchase shares of our common stock, as well as RSU awards, each representing the right to acquire shares of our common stock. In respect of the plans approved by security holders, including the 2000 Stock Incentive Plan, 2009 Stock Incentive Plan and 2019 Stock Incentive Plan, the number of shares reported represents 106,547 shares subject to stock options and 724,326 RSUs. For purposes of this table, the number of RSUs includes a number in respect of PRSUs granted under the 2019 Stock Incentive Plan that could have been earned during a three-year performance period which number reported is based on target performance. In respect of the plan not approved by security holders, the number of shares reported represents 4,877 shares subject to stock options, and 58,204 RSUs granted under the Amended and Restated Inducement Plan (described below) and 66,666 shares subject to stock options granted on a stand-alone basis to Mr. Sabino at the time of his hiring.
(2)The weighted average exercise price is calculated based solely on the outstanding stock options. It does not take into account the shares issuable upon vesting of outstanding RSU awards or performance stock units, which have no exercise price.
(3)Consists of 62,029 shares remaining available for issuance under the 2019 Stock Incentive Plan and 92,972 shares remaining available for issuance under the 2019 Employee Stock Purchase Plan.
(4)Represents shares under the Amended and Restated Inducement Plan, which is intended to qualify as an “inducement plan” under Nasdaq rule 5635(c)(4).
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Amended and Restated LivePerson, Inc. 2018 Inducement Plan
On January 19, 2018, the Board adopted the LivePerson, Inc. 2018 Inducement Plan (which has been subsequently amended and restated) (as amended and restated, the “Amended and Restated Inducement Plan”). The Amended and Restated Inducement Plan provides for the grants of awards of stock options, stock appreciation rights, restricted stock, RSUs and other stock and cash-based awards to persons who have not previously been an employee or director of the Company, or to an individual following a bona fide period of non-employment with the Company, as an inducement for the individual’s entering into employment with the Company. The purpose of the Amended and Restated Inducement Plan is to help the Company provide an inducement to attract and retain the employment services of new employees, to motivate those new employees whose potential contributions are important to the success of the Company to accept an offer of employment by providing them with equity ownership opportunities, and to advance the interests of the Company’s stockholders by providing incentives to those eligible individuals who are expected to make important contributions to the Company.
In the event of any stock split, reverse stock split, stock dividend, recapitalization, combination of shares, reclassification of shares, spin-off or other similar change in capitalization or event, or any dividend or distribution to holders of our common stock other than an ordinary cash dividend, the Board will make equitable adjustments to the maximum number and type of shares or other securities that may be issued under the Amended and Restated Inducement Plan, the maximum number and type of shares that may be granted to any participant in any calendar year, the number and type of shares subject to outstanding awards, the exercise price or grant price of outstanding awards and other necessary adjustments in connection with the Amended and Restated Inducement Plan.
The Amended and Restated Inducement Plan is administered by our Board. Pursuant to the terms of the Amended and Restated Inducement Plan, subject to applicable law, our Board may delegate certain authority under the Amended and Restated Inducement Plan to one or more of its committees or subcommittees or one or more of our officers, provided that the authority to grant equity awards to future employees whom will be considered to be “executive officers” and/or “officers” under Rules 3b-7 and 16a-1, respectively, of the Exchange Act may not be delegated to our officers. Subject to the provisions of the Amended and Restated Inducement Plan, the Board has the power to select the recipients of awards, to determine the number of shares subject to any award, to establish and verify the extent of satisfaction of any performance goals or other conditions applicable to awards, to determine whether, and the extent to which, adjustments are required under the Amended and Restated Inducement Plan, and to determine the terms and conditions of awards. Our Board may also modify awards granted to participants who are foreign nationals or employed outside the United States or establish sub-plans or procedures under the Amended and Restated Inducement Plan to recognize differences in laws, rules, regulations or customs of such foreign jurisdictions with respect to tax, securities, currency, employee benefit or other matters.
Stock Options
Our Board may grant nonqualified stock options under the Amended and Restated Inducement Plan. The number of shares covered by each stock option granted to a participant (subject to the Amended and Restated Inducement Plan’s stated limit) and all other terms and conditions will be determined by our Board. The stock option exercise price is established by our Board and must be at least 100% of the fair market value of a share on the date of grant. Consistent with applicable laws, regulations and rules, and to the extent authorized by the Board, payment of the exercise price of stock options may be made in one or more of the following: (i) cash or check, (ii) broker assisted cashless exercise, (iii) shares of our common stock, (iv) net exercise, (v) delivery to us of a promissory note, (vi) any other lawful means, or (vii) any combination of these permitted forms of payment. The Amended and Restated Inducement Plan prohibits decreasing the exercise price of an option or canceling an option and replacing it with an award with a lower exercise price.
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After a termination of a participant’s services with the Company, a participant will be able to exercise the vested portion of his or her option for the period of time stated in the applicable stock option agreement. Unless otherwise provided by the Board, unvested stock options will generally expire upon termination of the participant’s employment and vested stock options will generally expire immediately following a termination for cause. In no event, however, may a stock option be exercised beyond its original expiration date. The term of a stock option will not exceed 10 years from the date of grant.
Stock Appreciation Rights
Our Board may grant stock appreciation rights under the Amended and Restated Inducement Plan. Stock appreciation rights typically provide for the right to receive the appreciation in the fair market value of our common stock between the grant date and the exercise date. Our Board may grant stock appreciation rights either alone or in tandem with a stock option granted under the Amended and Restated Inducement Plan. The number of shares of our common stock covered by each stock appreciation right (subject to the Amended and Restated Inducement Plan’s stated limit) and all other terms and conditions will be determined by our Board. Stock appreciation rights are generally subject to the same terms and limitations applicable to options or, when granted in tandem with an option, to the same terms as the option. Stock appreciation rights may be paid in cash or shares or any combination of both, as determined by the Board in its sole discretion. Unless otherwise approved by our stockholders, the Amended and Restated Inducement Plan prohibits decreasing the exercise price of a stock appreciation right or canceling a stock appreciation right and replacing it with an award with a lower exercise price.
Restricted Stock
Our Board may award shares of restricted stock under the Amended and Restated Inducement Plan. Our Board will determine the terms of any restricted stock award, including the number of shares subject to such award (subject to the Amended and Restated Inducement Plan’s stated limit), and conditions for vesting and repurchase. Participants holding restricted stock will be entitled to all ordinary cash dividends paid with respect to such shares, which dividends shall be accrued and become payable when and if the restricted stock vests. When the restricted stock award conditions are satisfied, the shares will no longer be subject to forfeiture as the participant is vested in the shares and has complete ownership of the shares.
Restricted Stock Units
Our Board may also grant an award of RSUs under the Amended and Restated Inducement Plan. An RSU is a bookkeeping entry representing an amount equivalent to the fair market value of one share of our common stock. Participants are not required to pay us any consideration at the time of grant of an RSU award. Our Board will determine the terms of any RSU award, including the number of shares covered by such award (subject to the Amended and Restated Inducement Plan’s stated limit), and the conditions for vesting and repurchase. RSU awards may include a dividend equivalent right feature, but any dividends payable to stockholders will accrue with respect to the RSU and become payable only when and if the underlying RSU vests. When the participant satisfies the conditions of an RSU award, we will pay the participant cash or shares of our common stock to settle the vested RSUs. Our Board may permit a participant to elect to defer the settlement of his or her vested RSU award until a later date; provided that such deferral election must be made pursuant to an exemption from, or in compliance with, Section 409A of the Code.
Other Stock-Based and Cash-Based Awards
Under the Amended and Restated Inducement Plan, our Board may also grant awards of shares of our common stock or other awards denominated in cash. Our Board will determine the terms of any such stock-based or cash-based award,
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including the number of shares or amount of cash, as applicable, covered by such award (subject to the Amended and Restated Inducement Plan’s stated limit), and the conditions for vesting.
Performance Awards
Our Board may grant performance awards under the Amended and Restated Inducement Plan. Performance awards provide participants with the opportunity to earn a payout subject to the award only if certain performance goals or other vesting criteria are achieved. Our Board will establish the performance goals or other vesting in its discretion, which, depending on the extent to which they are met, will determine the number and/or the value of performance shares to be paid out to participants. Our Board has discretion to determine other terms of the performance award, including the number of shares or value subject to a performance award (subject to the Amended and Restated Inducement Plan’s stated limit), the period as to which performance is to be measured, any applicable forfeiture provisions and any other terms and conditions consistent with the Amended and Restated Inducement Plan. After the completion of the performance period applicable to the award, our Board will measure performance against the applicable goals and other vesting criteria and determine whether any payment will be made under the award. If the participant satisfies the conditions of the performance share award, we will pay the participant cash or shares or any combination of both to settle the award.
Performance Goals
Our Board may establish performance criteria and level of achievement versus such criteria that will determine the number of shares to be granted, retained, vested, issued or issuable under or in settlement of or the amount payable pursuant to an award, which criteria may be based on certain performance goals (as described below). The performance criteria for each such performance award will be based on one or more of the following measurable performance goals: (a) net income, (b) earnings before or after discontinued operations, interest, taxes, depreciation and/or amortization, (c) operating profit before or after discontinued operations and/or taxes, (d) sales, (e) sales growth, (f) earnings growth, (g) cash flow or cash position, (h) gross margins, (i) stock price, (j) market share, (k) return on sales, assets, equity or investment, (l) improvement of financial ratings, (m) achievement of balance sheet or income statement objectives, (n) total stockholder return, (o) introduction of new products, (p) expansion into new markets or (q) achievement of any other strategic, operational or individual performance goals as the Board may determine.
These performance goals may reflect absolute entity or business unit performance or a relative comparison to the performance of a peer group of entities or other external measure of the selected performance criteria and may be absolute in their terms or measured against or in relationship to other companies comparably, similarly or otherwise situated. Our Board may specify that such performance measures shall be adjusted to exclude any one or more of (i) extraordinary items, (ii) gains or losses on the dispositions of discontinued operations, (iii) the cumulative effects of changes in accounting principles, (iv) the write-down of any asset, and (v) charges for restructuring and rationalization programs. Such performance goals may: (i) vary by participant and may be different for different awards and (ii) be particular to a participant or the department, branch, line of business, subsidiary or other unit in which the participant works and may cover such period as may be specified by the Board.
Transferability of Awards
Awards granted under the Amended and Restated Inducement Plan generally may not be transferred other than by will or the laws of descent and distribution or pursuant to a qualified domestic relations order. During the life of the participant, awards are exercisable only by the participant. Our Board may in its sole discretion permit and subject to certain conditions provide for the gratuitous transfer of an award to or for the benefit of any immediate family member, family trust or other entity established for the benefit of the participant and/or an immediate family member thereof to the extent permitted under Form S-8 under the Securities Act.
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Reorganization Event
In the event of a reorganization of the Company, each outstanding award will be treated as our Board determines, including, without limitation, that each award may be assumed or an equivalent option or right substituted by the successor corporation, or in the case of stock options, may be terminated after giving holders notice of such pending termination and a change to exercise the option prior to the reorganization event. In addition, the vesting of awards that are unvested at the time of a reorganization event does not automatically accelerate, but our Board may cause any vesting to accelerate or restrictions lapse in connection with the change in control event. In the case that stockholders are receiving a cash payment for each share in a reorganization event, our Board may also provide that all awards will be canceled in connection with the reorganization event in exchange for the holder of such award receiving a cash payment for each share underlying the award in the same amount as the stockholders receive, or, in the case of options, the excess, if any, between the amount a stockholder is receiving and the exercise price of the stock option. Our Board will generally not be required to treat all awards, all awards held by a participant, or all awards of the same type, similarly in the transaction. Upon the occurrence of a liquidation or dissolution of the Company, except to the extent specifically provided otherwise in the restricted stock or RSU award agreement or any other agreement between a participant and us, all restrictions and conditions on all restricted stock and RSU awards then outstanding will automatically be deemed terminated or satisfied.
Amendment and Termination
Our Board may amend, suspend or terminate the Amended and Restated Inducement Plan at any time and for any reason, provided that any amendment may not materially and adversely affect the rights of the existing participants under the Amended and Restated Inducement Plan. No award will be made that is conditioned upon stockholder approval of any amendment to the Amended and Restated Inducement Plan. The Amended and Restated Inducement Plan will terminate on January 19, 2028, unless re-adopted or extended by the stockholders prior to or on such date or unless terminated earlier by the Board.
Forfeiture Events; Clawback
Awards granted pursuant to the Amended and Restated Inducement Plan shall be subject to the terms of any clawback policy adopted by us as in effect from time to time, as well as any recoupment/forfeiture provisions required by law and applicable to us or our subsidiaries or specified in any award agreement. Please refer to the section of this Amendment titled “Compensation Recovery Policy” above for additional information on our clawback policy.
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Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Ownership of Securities
The following table sets forth information with respect to the beneficial ownership of our outstanding common stock as of March 31, 2026, unless otherwise indicated in the footnotes below, by:
•each person or group of affiliated persons whom we know to beneficially own more than five percent of our common stock;
•each of our named executive officers identified in the “Summary Compensation Table” included in this Amendment on page 7;
•each of our directors; and
•all of our directors and executive officers as a group.
A person is deemed to be a beneficial owner of any securities of which that person has a right to acquire beneficial ownership within 60 days after March 31, 2026, including any shares of our common stock subject to an option that are exercisable or will be exercisable, and any RSUs that have vested or will vest, within 60 days after March 31, 2026.
Beneficial ownership is determined in accordance with the rules of the SEC and includes voting and investment power with respect to shares. Percentage of beneficial ownership is based on 12,097,491 shares of common stock outstanding on March 31, 2026 (excluding shares held in treasury). Unless otherwise indicated, the persons named in the table directly own the shares and have sole voting and sole investment control with respect to all shares beneficially owned:
Name of Beneficial Owner (1) | Number of Shares Beneficially Owned (2) | Percentage of Common Stock Outstanding (%) | ||||||
| 5% Stockholders | ||||||||
Davidson Kempner Capital Management LP (3) | 686,800 | 5.7% | ||||||
| Executive Officers and Directors | ||||||||
John D. Collins (4) | 39,134 | * | ||||||
| Dan Fletcher | 5,333 | * | ||||||
| Nathan “Tripp” Lane | — | * | ||||||
| James Miller | 8,863 | * | ||||||
| Christopher Mina | 9,636 | * | ||||||
| Vanessa Pegueros | 9,333 | * | ||||||
| John Sabino | 42,115 | * | ||||||
| Karin-Joyce (K.J.) Tjon | 5,333 | * | ||||||
Ryan Vardeman (5) | 44,422 | * | ||||||
William G. Wesemann (6) | 39,389 | * | ||||||
| Anthony Zingale | — | * | ||||||
Directors and Executive Officers as a group (12 persons) (7) | 258,142 | 2.1% | ||||||
* Less than 1%.
(1)Unless noted otherwise, the business address of each beneficial owner is c/o LivePerson, Inc., 530 Seventh Avenue, Floor M1, New York, New York 10018.
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(2)Beneficial ownership is determined in accordance with the rules of the SEC and includes voting and/or investment power with respect to the shares shown as beneficially owned.
(3)Holdings based solely on our review of the Schedule 13D filed with the SEC on February 17, 2026 by M.H. Davidson & Co., Davidson Kempner Arbitrage, Equities & Relative Value LP, Davidson Kempner Capital Management LP and Anthony A. Yoseloff. The shares reported herein are held by subfunds of Davidson Kempner Capital Management LP (“DKCM”), specifically (i) M.H. Davidson & Co. and (ii) Davidson Kempner Arbitrage, Equities and Relative Value LP. DKCM serves as the investment manager to these subfunds and, pursuant to investment management agreements, exercises ultimate voting and dispositive power over the securities. The business address of each beneficial owner is c/o Davidson Kempner Capital Management LP, 9 West 57th Street, 29th Floor, New York, New York 10019.
(4)Includes 6,260 shares underlying options that are currently exercisable or that will be exercisable at or within 60 days of March 31, 2026 and 19,711 RSUs which will be vested within 60 days of March 31, 2026.
(5)Palogic Value Fund, L.P., a Delaware limited partnership (Palogic Value Fund), is the record and direct beneficial owner of these shares. Palogic Value Management, L.P., a Delaware limited partnership (Palogic Value Management), is the general partner of, and may be deemed to beneficially own securities owned by, Palogic Value Fund. Palogic Capital Management, LLC, a Delaware limited liability company (Palogic Capital Management), is the general partner of, and may be deemed to beneficially own securities beneficially owned by, Palogic Value Management. Mr. Vardeman is the sole member of, and may be deemed to beneficially own securities beneficially owned by, Palogic Capital Management. Mr. Vardeman is also a limited partner in, and may be deemed to beneficially own securities owned by, Palogic Value Fund. The address of Palogic Value Fund, Palogic Value Management and Palogic Capital Management is 8333 Douglas Avenue, Suite 775, Dallas, TX 75225.
Mr. Vardeman states that neither the filing of this Amendment nor anything herein shall be deemed an admission that Mr. Vardeman is, for purposes of Section 16 of the Exchange Act or otherwise, the beneficial owner of these shares. Mr. Vardeman disclaims beneficial ownership of these shares, except to the extent of his pecuniary interest in such shares. Mr. Vardeman may be deemed to be a member of a group with respect to the Company or securities of the Company for purposes of Section 13(d) or 13(g) of the Securities Exchange Act of 1934, as amended.
Mr. Vardeman declares that neither the filing of this Amendment nor anything herein shall be construed as an admission that such persons are, for the purposes of Section 13(d) or 13(g) of the Exchange Act, or any other purpose, a member of a group with respect to the Company or securities of the Company.
(6)Includes 9,067 shares underlying options that are currently exercisable or that will be exercisable at or within 60 days of March 31, 2026.
(7)Includes 34,229 shares underlying options that are currently exercisable or that will be exercisable at or within 60 days of March 31, 2026 and 28,987 RSUs which will be vested within 60 days of March 31, 2026
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Item 13. Certain Relationships and Related Transactions, and Director Independence
Certain Relationships and Related Party Transactions
Any transaction or series of transactions, of which the aggregate amount involved exceeds or may be reasonably expected to exceed $120,000, in which we participate and a related person has a material interest would require the prior approval by our Board. In such cases, the Board would review all of the relevant facts and circumstances and would take into account, among other factors, 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. If a transaction relates to a director, that director would not participate in the Board’s deliberations.
Related persons would include a member of our Board and our executive officers and their immediate family members. It would also include persons controlling over 5% of our outstanding common stock. Under our written policy on conflicts of interest, all of our directors, executive officers and employees have a duty to report to the appropriate level of management potential conflicts of interests, including transactions with related persons.
Pursuant to our Audit Committee Charter, our Audit Committee is responsible for reviewing potential conflict of interest situations and approving, on an ongoing basis, all related party transactions required to be disclosed pursuant to Item 404 of Regulation S-K. In particular, our Audit Committee Charter requires that our Audit Committee approve all transactions between the Company and one or more directors, executive officers, major stockholders or firms that employ directors, as well as any other material related party transactions that are identified in a periodic review of our transactions. In considering a related party transaction, the Audit Committee will consider such factors as it deems appropriate, including, without limitation, the commercial reasonableness of the terms, if the terms are judged to be the same as a transaction made on an arm’s-length basis, the benefit or perceived benefit (or lack thereof) to the Company, the impact on a director’s independence in the event the related person is a director, an immediate family member of a director or an entity in which a director has a position or relationship, opportunity costs and availability of alternate transactions, the materiality and character of the related person’s direct or indirect interest, and any actual or apparent conflict of interest of the related person.
Since the beginning of the 2025 Fiscal Year, the Company has not been a participant in any transaction with a related person other than the agreements and transactions described below.
Indemnification Agreements with Directors and Executive Officers
The Charter provides that we will indemnify each of our directors and officers to the fullest extent permitted by the Delaware General Corporation Law. In addition, we have entered into indemnification agreements with our directors and executive officers, the form of which was filed as an exhibit to our 2011 Annual Report on Form 10-K. The form of indemnification agreement used by the Company contains provisions that require us, among other things, to indemnify our directors and executive officers against certain liabilities (other than liabilities arising from intentional or knowing and culpable violations of law) that may arise by reason of their status or service as our directors or executive officers or other entities to which they provide service at our request and to advance expenses they may incur as a result of any proceeding against them as to which they could be indemnified. We believe that these provisions and agreements are necessary to attract and retain highly qualified individuals to serve the Company. We also have obtained an insurance
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policy covering our directors and executive officers for claims that such directors and executive officers may otherwise be required to pay or for which we are required to indemnify them, subject to certain exclusions.
Other Relationships and Transactions
In September 2025, the Company consummated an exchange of $341.1 million in aggregate principal amount of the Company’s outstanding 0% Convertible Senior Notes due 2026 (the “2026 Notes”) for (i) an aggregate payment of $45.0 million in cash, (ii) $115.0 million in aggregate principal amount of the Company’s 10.0% Second Lien Senior Subordinated Secured Notes due 2029 (“Second Lien Notes”), (iii) approximately 3.7 million shares of the Company’s common stock and (iv) 26,551 shares of Series B Fixed Rate Convertible Perpetual Preferred Stock, par value $0.001 (“Series B Preferred Stock”, and such transaction, the “2025 Debt Exchange Transaction”). As holders of the 2026 Notes, the following entities received the consideration listed below in connection with the 2025 Debt Exchange Transaction:
•Certain entities advised or managed by Linden Advisors LP received an aggregate (i) approximately $13.8 million in cash, (ii) approximately $35.3 million principal amount of Second Lien Notes, (iii) approximately 1.1 million shares of common stock and (iv) 8,162 shares of Series B Preferred Stock, which converted into approximately 0.5 million shares of common stock in October 2025;
•Certain entities advised or managed by Davidson Kempner Capital Management LP received an aggregate (i) approximately $8.5 million in cash, (ii) approximately $21.7 million principal amount of Second Lien Notes, (iii) approximately 0.7 million shares of common stock and (iv) 5,021 shares of Series B Preferred Stock, which converted into approximately 0.3 million shares of common stock in October 2025; and
•Palogic Value Fund, LP, which is managed by an entity co-founded by Mr. Vardeman and for which he serves as a principal, received as (i) approximately $1.3 million in cash, (ii) approximately $3.3 million principal amount of Second Lien Notes, (iii) approximately 0.1 million shares of common stock, and (iv) 762 shares of Series B Preferred Stock, which converted into approximately 44,000 shares of common stock in October 2025.
In addition, the Company paid an aggregate $14.7 million of legal and advisory fees of the holders of 2026 Notes in connection with the Debt Exchange Transaction.
Director Independence
The Board has determined that the Chair of the Board, Mr. Miller, as well as Mr. Fletcher, Mr. Lane, Ms. Pegueros, Ms. Tjon, Mr. Vardeman, Mr. Wesemann and Mr. Zingale, are “independent” under the Nasdaq listing requirements and the applicable rules and regulations of the SEC. As part of the Board’s process in making such determination, each such director provided confirmation that (a) the objective criteria for independence pursuant to the Nasdaq rules are satisfied and (b) each such director has no other relationship with the Company that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. Mr. Sabino, our CEO and a member of the Board, is an employee and therefore not “independent” under these requirements, rules and regulations.
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Item 14. Principal Accountant Fees and Services
Fees Billed to the Company for Services Rendered during the Fiscal Years Ended December 31, 2025 and 2024
The following table presents fees for professional audit services and other services provided to LivePerson by BDO USA, P.C. for the fiscal years ended December 31, 2025 and 2024.
| 2025 | 2024 | |||||||||||||
Audit Fees (1) | $1,025,000 | $1,200,000 | ||||||||||||
| Audit-Related Fees | — | — | ||||||||||||
| Tax Fees | — | — | ||||||||||||
| All Other Fees | — | — | ||||||||||||
(1)“Audit Fees” for 2025 and 2024 consist of fees for professional services rendered in connection with the audit of the Company’s consolidated annual financial statements, the review of the Company’s interim condensed consolidated financial statements included in quarterly reports, and procedures in connection with regulatory filings.
Pre-Approval Policies and Procedures
The Audit Committee pre-approves all audit and permissible non-audit services. The Audit Committee has authorized each of its members to pre-approve audit, audit-related, tax and non-audit services, provided that such approved service is reviewed with the full Audit Committee at its next meeting.
As early as practicable in each fiscal year, the independent registered public accounting firm provides to the Audit Committee a schedule of the audit and other services that they expect to provide or may provide during the year. The schedule is specific as to the nature of the proposed services, the proposed fees and other details that the Audit Committee may request. The Audit Committee by resolution authorizes or declines the proposed services. Upon approval, this schedule serves as the budget for fees by specific activity or service for the year.
A schedule of additional services proposed to be provided by the independent registered public accounting firm or proposed revisions to services already approved, along with associated proposed fees, may be presented to the Audit Committee for their consideration and approval at any time. The schedule is required to be specific as to the nature of the proposed service, the proposed fee, and other details that the Audit Committee may request. The Audit Committee intends by resolution to authorize or decline authorization for each proposed new service.
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PART IV
Item 15. Exhibits and Financial Statement Schedules
The following documents are filed as part of this Form 10K/A:
3. Exhibits.
| Number | Description | |||||||
| 2.1 | Merger Agreement, dated as of April 21, 2026, by and among SoundHound AI, Inc., Lightspeed Merger Sub Inc. and LivePerson, Inc. (incorporated by reference to Exhibit 2.1 to Current Report on Form 8-K filed by SoundHound AI, Inc. on April 21, 2026) | |||||||
| 3.1(a) | Fourth Amended and Restated Certificate of Incorporation (incorporated by reference to the Exhibit 3.1 to LivePerson’s Annual Report on Form 10-K for the year ended December 31, 2000 and filed March 30, 2001) | |||||||
| 3.1(b) | Certificate of Amendment to the Fourth Amended and Restated Certificate of Incorporation effective as of November 12, 2019 (incorporated by reference to Exhibit 4.2 to LivePerson’s Registration Statement on Form S-8 filed on November 13, 2019) | |||||||
| 3.1(c) | Certificate of Amendment No. 2 to the Fourth Amended and Restated Certificate of Incorporation effective as of October 3, 2025 (incorporated by reference to Exhibit 3.1 to LivePerson’s Current Report on Form 8-K filed on October 7, 2025) | |||||||
| 3.1(d) | Certificate of Amendment No. 3 to the Fourth Amended and Restated Certificate of Incorporation, as amended (incorporated by reference to Exhibit 3.4 to LivePerson’s Quarterly Report on Form 10-Q filed on November 13, 2025) | |||||||
| 3.2 + | Fourth Amended and Restated By-Laws of LivePerson, Inc., as amended | |||||||
| 3.3 | Certificate of Designations of the Series A Junior Participating Preferred Stock of the Company, dated January 22, 2024 (incorporated by reference to Exhibit 3.1 to LivePerson’s Current Report on Form 8-K filed on January 22, 2024) | |||||||
| 3.4 | Certificate of Designation of Series B Preferred Stock (incorporated by reference to Exhibit 4.3 to LivePerson’s Current Report on Form 8-K filed on September 15, 2025) | |||||||
| 4.1 | Specimen common stock certificate (incorporated by reference to Exhibit 4.1 to LivePerson’s Registration Statement on Form S-1/A filed on March 28, 2000) | |||||||
| 4.2 | Second Amended and Restated Registration Rights Agreement, dated as of January 27, 2000, by and among LivePerson, the several persons and entities named on the signature pages thereto as Investors, and Robert LoCascio (incorporated by reference to Exhibit 4.2 to LivePerson’s Registration Statement on Form S-1/A filed on March 10, 2000) | |||||||
| 4.3 | Description of the Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (incorporated by reference to Exhibit 4.3 to LivePerson's Annual Report on Form 10-K for the year ended December 31, 2025 and filed on March 16, 2026) | |||||||
| 4.4 | Indenture, dated as of December 4, 2020, by and between LivePerson, Inc. and U.S. Bank National Association, as Trustee (incorporated by reference to Exhibit 4.1 to LivePerson’s Current Report on Form 8-K/A filed on December 10, 2020) | |||||||
| 4.5 | Form of 0% Convertible Senior Note due 2026 (included within the Indenture filed as Exhibit 4.4 hereto) | |||||||
4.6 | Tax Benefits Preservation Plan, dated as of January 22, 2024, by and between the Company and Equiniti Trust Company, LLC as rights agent (which includes the Form of Rights Certificate as Exhibit B thereto) (incorporated by reference to Exhibit 4.1 to LivePerson’s Current Form 8-K filed on January 22, 2024) | |||||||
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4.7 | Amendment, dated as of February 16, 2024, to the Tax Benefits Preservation Plan, between LivePerson, Inc. and Equiniti Trust Company, LLC (incorporated by reference to Exhibit 4.1 to LivePerson’s Current Form 8-K filed on February 16, 2024) | |||||||
4.8 | Indenture, dated as of June 3, 2024, by and between LivePerson, Inc., the subsidiary guarantors party thereto and U.S. Bank Trust Company, National Association, as Trustee and as Collateral Agent (incorporated by reference to Exhibit 4.1 to LivePerson’s Current Report on Form 8-K filed on June 4, 2024) | |||||||
4.9 | Form of First Lien Convertible Senior Note due 2029 (included within the Indenture filed as Exhibit 4.8 hereto) | |||||||
| 4.10 | Warrant to Purchase Common Stock issued by LivePerson, Inc. on June 3, 2024 to Lynrock Lake Master Fund LP (incorporated by reference to Exhibit 4.3 to LivePerson’s Current Report on Form 8-K filed on June 4, 2024) | |||||||
| 4.11 | Warrant issued by LivePerson, Inc. on June 3, 2024 to Lynrock Lake Master Fund LP (incorporated by reference to Exhibit 4.4 to LivePerson’s Current Report on Form 8-K filed on June 4, 2024) | |||||||
| 4.12 | Supplemental Indenture No. 1, dated as of August 15, 2024, by and between LivePerson, Inc., the subsidiary guarantors party thereto and U.S. Bank Trust Company, National Association, as Trustee and as Collateral Agent (incorporated by reference to Exhibit 4.14 to LivePerson’s Annual Report on Form 10-K filed on March 14, 2025) | |||||||
| 4.13 | Supplemental Indenture No. 2, dated as of August 15, 2024, by and between LivePerson, Inc., the subsidiary guarantors party thereto and U.S. Bank Trust Company, National Association, as Trustee and as Collateral Agent (incorporated by reference to Exhibit 4.15 to LivePerson’s Annual Report on Form 10-K filed on March 14, 2025) | |||||||
| 4.14 | Supplemental Indenture No. 3, dated as of August 15, 2024, by and between LivePerson, Inc., the subsidiary guarantors party thereto and U.S. Bank Trust Company, National Association, as Trustee and as Collateral Agent (incorporated by reference to Exhibit 4.16 to LivePerson’s Annual Report on Form 10-K filed on March 14, 2025) | |||||||
| 4.15 | Supplemental Indenture No. 4, dated as of August 15, 2024, by and between LivePerson, Inc., the subsidiary guarantors party thereto and U.S. Bank Trust Company, National Association, as Trustee and as Collateral Agent (incorporated by reference to Exhibit 4.17 to LivePerson’s Annual Report on Form 10-K filed on March 14, 2025) | |||||||
| 4.16 | Supplemental Indenture No. 5, dated as of August 15, 2024, by and between LivePerson, Inc., the subsidiary guarantors party thereto and U.S. Bank Trust Company, National Association, as Trustee and as Collateral Agent (incorporated by reference to Exhibit 4.18 to LivePerson’s Annual Report on Form 10-K filed on March 14, 2025) | |||||||
| 4.17 | Supplemental Indenture No. 6, dated as of December 17, 2024, by and between LivePerson, Inc., the subsidiary guarantors party thereto and U.S. Bank Trust Company, National Association, as Trustee and as Collateral Agent (incorporated by reference to Exhibit 4.19 to LivePerson’s Annual Report on Form 10-K filed on March 14, 2025) | |||||||
| 4.18 | Notice from Lynrock Lake Master Fund LP, dated September 12, 2025 (incorporated by reference to Exhibit 4.4 to the Company’s Current Report on Form 8-K filed on September 15, 2025) | |||||||
| 4.19 | Indenture, dated as of September 12, 2025, by and among LivePerson, Inc., the subsidiary guarantors party thereto and U.S. Bank Trust Company, National Association, as Trustee and as Collateral Agent (incorporated by reference to Exhibit 4.1 to LivePerson’s Current Report on Form 8-K filed on September 15, 2025) | |||||||
| 4.20 | Form of Second Lien Senior Subordinated Secured Note due 2029 (included within the Indenture filed as Exhibit 4.19 hereto) | |||||||
| 10.1 | Exchange and Purchase Agreement, dated as of May 13, 2024, by and between LivePerson, Inc. and Lynrock Lake Master Fund LP (incorporated by reference to Exhibit 10.1 to LivePerson’s Current Report on Form 8-K filed on May 13, 2024) | |||||||
| 10.2 | First Amendment to Exchange and Purchase Agreement, dated as of June 3, 2024, by and between LivePerson, Inc. and Lynrock Lake Master Fund LP (incorporated by reference to Exhibit 10.1 to LivePerson’s Current Report on Form 8-K filed on June 4, 2024) | |||||||
| 10.3 | Exchange Agreement, dated August 11, 2025, by and between LivePerson, Inc. and the Noteholders (incorporated by reference to Exhibit 10.1 to LivePerson’s Current Report on Form 8-K filed on August 11, 2025) | |||||||
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| 10.4 | Amendment No. 1 to the Exchange Agreement, dated August 11, 2025, by and between LivePerson, Inc. and the Noteholders (incorporated by reference to Exhibit 10.1 to LivePerson’s Current Report on Form 8-K filed on September 15, 2025) | |||||||
| 10.5(a)* | 2009 Stock Incentive Plan (incorporated by reference to Exhibit 99.1 to LivePerson’s Registration Statement on Form S-8 filed on June 9, 2009) | |||||||
| 10.5(b)* | 2009 Stock Incentive Plan (amended and restated as of June 7, 2012) (incorporated by reference to Exhibit 99.1 to LivePerson’s Current Report on Form 8-K filed on June 8, 2012) | |||||||
| 10.5(c)* | Forms of Grant Agreements under the 2009 Stock Incentive Plan (incorporated by reference to Exhibit 10.1 to LivePerson’s Quarterly Report on Form 10-Q filed on May 6, 2011) | |||||||
| 10.5(d)* | Form of Restricted Stock Unit Award Agreement under the 2009 Stock Incentive Plan (incorporated by reference to Exhibit 10.12 to LivePerson’s Annual Report on Form 10-K for the year ended December 31, 2017, filed on March 15, 2018) | |||||||
| 10.6* | Form of Indemnification Agreement entered into with Executive Officers and Directors of LivePerson (incorporated by reference to Exhibit 10.6 to LivePerson’s Annual Report on Form 10-K for the year ended December 31, 2011, filed March 13, 2012) | |||||||
| 10.7* | Offer Letter Agreement between LivePerson, Inc. and Monica L. Greenberg, dated as of October 25, 2006 (incorporated by reference to Exhibit 10.8 to LivePerson’s Annual Report on Form 10-K for the year ended December 31, 2011, filed March 13, 2012) | |||||||
| 10.8* | Incentive Plan effective April 1, 2011 (incorporated by reference to Exhibit 10.1 to LivePerson’s Current Report on Form 8-K filed on April 28, 2011) | |||||||
| 10.9(a)* | Amended and Restated LivePerson, Inc. 2018 Inducement Plan, effective as of September 30, 2024 (incorporated by reference to Exhibit 99.3 to LivePerson’s Registration Statement on Form S-8 filed on December 16, 2024) | |||||||
| 10.9(b)* | Amendment to the Amended and Restated LivePerson, Inc. 2018 Inducement Plan (dated as of December 10, 2024) (incorporated by reference to Exhibit 99.4 to LivePerson’s Registration Statement on Form S-8 filed on December 16, 2024) | |||||||
| 10.10* | Amended Employment Agreement between LivePerson and Robert LoCascio, dated as of December 27, 2017 (incorporated by reference to Exhibit 10.15 to LivePerson’s Annual Report on Form 10-K for the year ended December 31, 2017, filed on March 15, 2018) | |||||||
| 10.11* | Amended and Restated LivePerson, Inc. 2019 Stock Incentive Plan, effective as of November 25, 2024 (incorporated by reference to Exhibit 10.1 to LivePerson’s Current Report on Form 8-K filed on November 26, 2024) | |||||||
| 10.12*+ | Amendment to the Amended and Restated LivePerson, Inc. 2019 Stock Incentive Plan, effective as of June 25, 2025 | |||||||
| 10.13* | Amended and Restated LivePerson, Inc. 2019 Employee Stock Purchase Plan, effective as of November 25, 2024 (incorporated by reference to Exhibit 10.2 to LivePerson’s Current Report on Form 8-K filed on November 26, 2024) | |||||||
| 10.14 | Form of Base Capped Call Transaction Confirmation relating to the 0% Convertible Senior Notes due 2026 (incorporated by reference to Exhibit 10.1 to LivePerson’s Current Report on Form 8-K/A filed on December 10, 2020) | |||||||
| 10.15 | Form of Additional Capped Call Transaction Confirmation relating to the 0% Convertible Senior Notes due 2026 (incorporated by reference to Exhibit 10.2 to LivePerson’s Current Report on Form 8-K/A filed on December 10, 2020) | |||||||
| 10.16 | Agreement, dated as of July 20, 2022, by and among LivePerson, Inc. and the Starboard parties set forth on the signature pages thereto (incorporated by reference to Exhibit 10.1 to LivePerson’s Current Report on Form 8-K filed on July 21, 2022) | |||||||
| 10.17* | Amended and Restated Offer Letter between LivePerson and John D. Collins, dated as of August 9, 2022 (incorporated by reference to Exhibit 10.1 to LivePerson’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2022, filed on November 8, 2022) | |||||||
| 10.18* | Form of Restricted Stock Unit Agreement under the 2019 Stock Incentive Plan (incorporated by reference to Exhibit 10.20 to LivePerson’s Annual Report on Form 10-K for the year ended December 31, 2022, filed on March 16, 2023) | |||||||
| 10.19* | Offer Letter, by and between LivePerson and Jeffrey Ford, dated as of July 31, 2023 (incorporated by reference to Exhibit 10.5 to LivePerson’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, filed on November 9, 2023) | |||||||
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| 10.20* | Letter Agreement, by and between LivePerson and Monica Greenberg, dated as of August 9, 2023 (incorporated by reference to Exhibit 10.4 to LivePerson’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, filed on November 9, 2023) | |||||||
| 10.21* | Letter Agreement, by and between LivePerson and John Collins, dated as of August 9, 2023 (incorporated by reference to Exhibit 10.3 to LivePerson’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, filed on November 9, 2023) | |||||||
| 10.22* | Employment Agreement, by and between LivePerson and John Sabino, dated as of December 27, 2023 (incorporated by reference to Exhibit 10.26 to LivePerson’s Annual Report on Form 10-K for the year ended December 31, 2023, filed on March 4, 2024) | |||||||
| 10.23* | Separation and Release of Claims Agreement, by and between LivePerson and Robert P. LoCascio, dated as of January 31, 2024 (incorporated by reference to Exhibit 10.29 to LivePerson’s Annual Report on Form 10-K/A for the year ended December 31, 2023 and filed on April 29, 2024) | |||||||
| 10.24* | Nonstatutory Stock Option Agreement, by and between LivePerson, Inc. and John Sabino, dated as of March 25, 2024 (incorporated by reference to Exhibit 10.21 to LivePerson’s Annual Report on Form 10-K filed on March 14, 2025) | |||||||
| 10.25* | Restricted Stock Unit Award Agreement (2-year), by and between LivePerson, Inc. and John Sabino, dated as of March 25, 2024 (incorporated by reference to Exhibit 10.22 to LivePerson’s Annual Report on Form 10-K filed on March 14, 2025) | |||||||
| 10.26* | Restricted Stock Unit Award Agreement (4-year), by and between LivePerson, Inc, and John Sabino, dated as of March 25, 2024 (incorporated by reference to Exhibit 10.23 to LivePerson’s Annual Report on Form 10-K filed on March 14, 2025) | |||||||
| 10.27 | Cooperation Agreement, by and among the Company and the persons set forth on Exhibit A thereto, dated October 20, 2024 (incorporated by reference to Exhibit 10.1 to LivePerson’s Current Report on Form 8-K filed on October 23, 2024) | |||||||
| 10.28 | Notes Restructuring Agreement, dated as of April 21, 2026, by and among SoundHound AI, Inc., LivePerson, Inc. and each holder of LivePerson’s First Lien Convertible Senior Notes due 2029 and Second Lien Senior Subordinated Secured Notes due 2029 (incorporated by reference to Exhibit 10.1 to LivePerson’s Current Report on Form 8-K filed on April 21, 2026) | |||||||
| 19 | LivePerson, Inc. Insider Trading and Disclosure Policy (incorporated by reference to Exhibit 19 to LivePerson’s Annual Report on Form 10-K filed on March 14, 2025) | |||||||
| 21.1 | Subsidiaries of the Registrant (incorporated by reference to Exhibit 21.1 to LivePerson's Annual Report on Form 10-K filed on March 16, 2026) | |||||||
| 23.1 | Consent of BDO USA, P.C., an Independent Registered Public Accounting Firm (incorporated by reference to Exhibit 23.1 to LivePerson's Annual Report on Form 10-K filed on March 16, 2026) | |||||||
| 24.1 | Power of Attorney, pursuant to which amendments to this report may be filed (included on the signature page contained in Part IV of the Original Form 10-K) | |||||||
| 31.1 | Certification by principal executive officer pursuant to Exchange Act Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (incorporated by reference to Exhibit 31.1 to LivePerson's Annual Report on Form 10-K filed on March 16, 2026) | |||||||
| 31.2 | Certification by principal financial officer pursuant to Exchange Act Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (incorporated by reference to Exhibit 31.2 to LivePerson's Annual Report on Form 10-K filed on March 16, 2026) | |||||||
| 31.3+ | Certification by principal executive officer pursuant to Exchange Act Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |||||||
| 31.4+ | Certification by principal executive officer pursuant to Exchange Act Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |||||||
| 32.1** | Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (incorporated by reference to Exhibit 32.1 to LivePerson's Annual Report on Form 10-K filed on March 16, 2026) | |||||||
| 32.2** | Certification by Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (incorporated by reference to Exhibit 32.2 to LivePerson's Annual Report on Form 10-K filed on March 16, 2026) | |||||||
| 97.1 | LivePerson, Inc. Amended & Restated Omnibus Clawback Policy (incorporated by reference to Exhibit 97.1 to LivePerson’s Annual Report on Form 10-K filed on March 4, 2024) | |||||||
32
| 101.INS | Inline XBRL Instance Document - The instance document does not appear in the interactive Data File because its XBRL tags are embedded within the Inline XBRL document | |||||||
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document | |||||||
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |||||||
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |||||||
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |||||||
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |||||||
| 104 | Cover Page Interactive Data File (formatted as inline XBRL) | |||||||
* Management contract or compensatory plan or arrangement
+ Filed herewith
** The certifications furnished as Exhibit 32.1 and Exhibit 32.2 accompany the Original Form 10-K pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed “filed” by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.
33
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on April 30, 2026.
| LIVEPERSON, INC. | ||||||||
| By: | /s/ JOHN SABINO | |||||||
| Name: | John Sabino | |||||||
| Title: | Chief Executive Officer | |||||||
(Principal Executive Officer) | ||||||||
34
FAQ
What is LivePerson (LPSN) changing in its 2025 Form 10-K/A?
LivePerson is amending its 2025 annual report to add Part III information on directors, executive officers, corporate governance, compensation and equity plans. The amendment does not revise previously filed financial statements or internal control disclosures, focusing instead on governance and pay details.
How much was LivePerson’s 2025 CEO compensation?
LivePerson’s CEO John Sabino received total 2025 compensation of $1,039,037, including a $550,000 salary, an annual cash bonus and stock awards. His pay structure emphasizes at‑risk incentive and equity components aligned with company performance and long‑term shareholder interests.
How were 2025 annual bonuses determined for LivePerson executives?
Annual bonuses were tied to B2B recurring revenue, B2B new annual recurring revenue and B2B free cash flow, with respective weightings of 30%, 30% and 40%. Overall performance funded the bonus pool at about 32% of target, which drove each named officer’s 2025 cash incentive payout.
What equity awards did LivePerson executives receive in 2025?
In 2025, executives received restricted stock units under the 2019 Stock Incentive Plan and inducement plan. Awards included time‑based RSUs for CEO John Sabino and CFO/COO John Collins and a sign‑on RSU grant for CTO Christopher Mina, designed to support retention and align interests with shareholders.
How many LivePerson shares were outstanding and what was its market value?
LivePerson had 12,053,603 common shares outstanding on March 6, 2026. The aggregate market value of voting common stock held by non‑affiliates was $84,994,598 as of June 30, 2025, based on the Nasdaq Global Select Market closing sale price on that date.
What stock ownership guidelines apply to LivePerson executives and directors?
LivePerson expects the CEO to hold stock equal to five times salary, other named executives two times salary, and non‑employee directors five times their annual cash retainer. Covered individuals have five years to reach these levels, encouraging long‑term alignment with shareholder value.
Does LivePerson have a clawback policy for executive compensation?
Yes. LivePerson’s clawback policy requires covered executives to repay erroneously awarded incentive compensation after an accounting restatement. It covers three fiscal years preceding the restatement and applies when incentive pay was based on financial reporting measures later adjusted downward.