HHS Harte Hanks Inc

PROXY STATEMENT TABLE OF CONTENTS

HARTE HANKS, INC.

1 Executive Drive, Suite 303

Chelmsford, MA 01824

PROXY STATEMENT

FOR THE ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD May 23, 2023

This proxy statement is being furnished to you in connection with the solicitation of proxies by the Board of Directors (the “Board”) of Harte Hanks, Inc. for use at our virtual annual meeting of stockholders (the “Annual Meeting”). In this proxy statement, references to “Harte Hanks,” the “Company,” “we,” “us,” “our” and similar expressions refer to Harte Hanks, Inc., unless the context of a particular reference provides otherwise. We refer to various websites in this proxy statement. None of the websites referenced in this proxy statement, including the Harte Hanks website, nor the information contained therein, shall be deemed to be incorporated into this proxy statement.

GENERAL INFORMATION

2023 Annual Meeting Date and Location

This year’s Annual Meeting will be held on Tuesday, May 23, 2023 at 2:00 p.m. Eastern Daylight Time, or at such other time to which the Annual Meeting may be adjourned or postponed. The Annual Meeting will be a completely virtual meeting of stockholders. You may attend, vote and submit questions during the Annual Meeting via live audio webcast on the Internet at http://www.virtualshareholdermeeting.com/HHS2023. We expect that in future years we will continue to host only virtual meetings, which we believe meaningfully enhances opportunities for stockholder attendance and participation and is also consistent with our cost reduction efforts to further position the Company for future growth.

Delivery of Proxy Materials

Mailing Date

The approximate date on which this proxy statement and accompanying proxy are first being sent or given to stockholders is April 28, 2023.

Important Notice Regarding Availability of Proxy Materials For 2023 Annual Meeting

We are mailing all stockholders this proxy statement and our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (the “Annual Report”). The proxy statement and our Annual Report are also available on our website at www.hartehanks.com, under the “SEC Filings” in the “Investor Relations” section of our website.

Any stockholder may request to receive proxy materials in printed form by mail or electronically by email on an ongoing basis. Choosing to receive future proxy materials by email will save us the cost of printing and mailing documents and will reduce the impact of annual meetings on the environment. A stockholder’s election to receive proxy materials by email will remain in effect until the stockholder terminates that election.

Stockholders Sharing an Address

Registered Stockholders - You are a registered stockholder if you own shares in your own name on the books of our transfer agent, Computershare Trust Company, N.A. The United States Securities and Exchange Commission (the “SEC”) permits a single set of annual reports and proxy statements to be sent to any household at which two or more registered stockholders reside if they appear to be members of the same family. Each stockholder continues to receive a separate proxy card. This procedure, referred to as householding, reduces the volume of duplicate information stockholders receive and reduces mailing and printing expenses. A number of brokerage firms have instituted householding. If your household would like to receive duplicate rather than single mailings in the future, please write to the Company at 1 Executive Drive, Suite 303, Chelmsford, Massachusetts 01824 (Attention: Secretary), or call 1-512-434-1100.

Street-name Stockholders - Most banks and brokers are delivering only one copy of the Annual Report and proxy statement to consenting street-name stockholders (you are a street-name stockholder if you own shares beneficially in the name of a bank, broker or other holder of record on the books of our transfer agent) who share the same address. This procedure reduces printing and distribution costs. Those who wish to receive separate copies may do so by contacting their bank, broker or other nominee, or (if offered) by checking the appropriate box on the voting instruction card sent to them. Similarly, most street-name stockholders who are receiving multiple copies of the Annual Report and proxy statement at a single address may request that only a single set of such materials be sent to them in the future by checking the appropriate box on the voting instruction card sent to them or by contacting their bank, broker or other nominee.

Voting

Stockholders Entitled to Vote

The record date for determining the common stockholders entitled to notice of and to vote at the Annual Meeting and any adjournment or postponement thereof is the close of business on April 20, 2023 (the “Record Date”). As of April 20, 2023, we had 7,490,107 shares of common stock issued and outstanding, which were held by approximately 852 holders of record.  Please refer to “Security Ownership of Management and Principal Stockholders” for information about common stock beneficially owned by our directors, executive officers and principal stockholders. Stockholders are entitled to one vote for each share of common stock owned as of the Record Date.  A list of stockholders entitled to vote at the virtual Annual Meeting will be open to the examination of any stockholder for any purpose germane to the Annual Meeting, during ordinary business hours at our corporate headquarters located at 1 Executive Drive, Suite 303, Chelmsford, MA 01824 for a period of at least ten days prior to the virtual Annual Meeting and on the virtual Annual Meeting website during the entirety of the meeting.

Voting of Proxies by Management Proxy Holders

The Board has appointed Mr. Brian Linscott (Chief Executive Officer), Ms. Laurilee Kearnes (Chief Financial Officer) and Mr. Robert Wyman (General Counsel), each with full powers of substitution and resubstitution, as the management proxy holders for the Annual Meeting. Your shares will be voted in accordance with the instructions on the proxy card you submit by mail, or the instructions provided for any proxy submitted by telephone or online, as applicable. For stockholders who have their shares voted by duly submitting a proxy online, by mail or telephone, the management proxy holders will vote all shares represented by such valid proxies as specified by such holder, and if not specified, in accordance with the Board’s recommendations:

As of the date of printing of this proxy statement, the Board is not aware of any other business or nominee to be presented or voted upon at the Annual Meeting. Should any other matter requiring a vote of stockholders properly arise, the proxies in the enclosed form confer upon the person or persons entitled to vote the shares represented by such proxies' discretionary authority to vote the same in accordance with their discretion.

Quorum; Required Votes

The virtual presence at the Annual Meeting, including by proxy, of holders of a majority of all of the shares of stock entitled to vote at the Annual Meeting present in person or by proxy is necessary to constitute a quorum for the transaction of business at the Annual Meeting. Abstentions and broker “non-votes” (which are described below) are counted as present at the Annual Meeting for purposes of determining whether a quorum is present. If a quorum is not present, the Annual Meeting may be adjourned or postponed from time to time until a quorum is obtained.

Submission of Proposal IV (Ratification of the Selection of Independent Registered Public Accounting Firm) is not legally required. However, the Board and its Audit Committee believe that such submission is an opportunity for stockholders to provide feedback to the Board and its Audit Committee on an important issue of corporate governance. If the stockholders do not ratify the selection of Baker Tilly US, LLP as our independent registered public accounting firm for the fiscal year ended December 31, 2023, the Audit Committee will reconsider the selection of such firm as independent auditors, although the results of the vote are not binding on the Audit Committee. The Audit Committee has the sole authority and responsibility to retain, evaluate, and, where appropriate, replace the Company’s independent auditors. Ratification by the stockholders of the selection of Baker Tilly US, LLP does not limit the authority of the Audit Committee to direct the appointment of new independent auditors at any time during fiscal year 2023 or thereafter.

Voting Procedures

Registered Stockholders - Registered stockholders may vote their shares or submit a proxy to have their shares voted by one of the following methods:

Street-name Stockholders - Street-name stockholders may generally vote their shares or submit a proxy to have their shares voted by one of the following methods:

A “broker non-vote” occurs when a nominee, such as a broker or dealer, holding shares for a beneficial owner does not vote on a particular proposal because the nominee does not have discretionary voting power with respect to that item and has not received instructions from the beneficial owner. On routine matters, brokers have the discretion to vote shares held in “street name” – a term that means the shares are held in the name of the broker on behalf of its customer, the beneficial owner. If your shares are held in “street name” by a broker and you wish to vote on the proposal to elect the directors (Proposal 1), the advisory vote to approve named executive officer compensation (Proposal 2), the advisory vote on the frequency of future advisory votes to approve the compensation of named executive officers (Proposal 4), or to act upon any other non-routine business that may properly come before the Annual Meeting, you should provide instructions to your broker. If you do not provide your broker with instructions, your broker generally will only have the authority to vote on the ratification of the appointment of Baker Tilly US, LLP, as the Company’s independent registered public accounting firm (Proposal 3). All other matters at the Annual Meeting are expected to be non-routine and therefore brokers will not be entitled to vote on a beneficial owner’s behalf without voting instructions or discretionary authority on such matters. 

If you need assistance in voting your shares, please call 1-512-434-1100 no later than the date before the Annual Meeting.

As a matter of policy, proxy cards, ballots and voting tabulations that identify individual stockholders are kept confidential by the Company. Such documents are made available only to the inspector of election and personnel associated with processing proxies and tabulating votes at the Annual Meeting. The votes of individual stockholders will not be disclosed except as may be required by applicable law.

Revoking Your Proxy

If you are a registered stockholder, you may revoke your proxy at any time before the shares are voted at the Annual Meeting by:

Your latest dated proxy card or telephone or internet proxy will be the one that is counted.

If you are a street-name stockholder and you vote by proxy, you may change your vote by submitting new voting instructions to your bank, broker or nominee in accordance with that entity’s procedures.

Dissenters’ Rights of Appraisal

None of Delaware law (the state of incorporation of Harte Hanks, Inc.), our Certificate of Incorporation, or our Bylaws, provides for appraisal or other similar rights for dissenting stockholders in connection with any of the proposals to be voted upon at the Annual Meeting. Accordingly, our stockholders will have no right to dissent and obtain payment for their share.

Attending the Annual Meeting Virtually

The Annual Meeting will be a completely virtual meeting of stockholders conducted exclusively by a live audio webcast.  Only record or beneficial owners of Harte Hanks common stock as of the Record Date may attend the virtual Annual Meeting, vote their shares and submit online questions.  

    Stockholders may access the meeting by visiting http://www.virtualshareholdermeeting.com/HHS2023, and using the 16-digit control number included on the Notice of Annual Meeting, on the proxy card or on the instructions accompanying the proxy materials. The Annual Meeting will begin promptly at 2:00 p.m., Eastern Daylight Time, and you should allow ample time for check-in procedures.

    If you wish to submit a question at the Annual Meeting, you may do so in advance at http://www.virtualshareholdermeeting.com/HHS2023, or you may type it into the dialog box provided at any point during the virtual meeting (until the floor is closed to questions).  We will endeavor to answer as many stockholder-submitted questions as time permits that comply with the Annual Meeting rules of conduct. We reserve the right to exclude questions regarding topics that are not pertinent to meeting matters or Company business. If we receive substantially similar questions, we may group such questions together and provide a single response to avoid repetition.

Solicitation Expenses

We will bear all costs incurred in the preparation, assembly, mailing and solicitation of proxies by our Board. In addition to solicitation by mail, our directors, officers and employees may solicit proxies personally or by telephone, e-mail, facsimile or other means, without additional compensation. We may also make arrangements with brokerage houses and other custodians, nominees and fiduciaries for the forwarding of solicitation materials to the beneficial owners of shares of common stock held by such persons, and we may reimburse these brokerage houses and other custodians, nominees and fiduciaries for reasonable expenses incurred in connection therewith.

Additionally, the Board has retained Saratoga Proxy Consulting, LLC, a proxy solicitation firm, who may solicit proxies on the Board’s behalf. We will pay Saratoga Proxy Consulting, LLC an estimated fee not to exceed $7,500 plus costs and expenses. Saratoga Proxy Consulting, LLC and certain related persons will be indemnified against certain liabilities arising out of or in connection with the engagement.

Delinquent Section 16(a) Reports

Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and related rules of the SEC require our directors, officers, and persons who own more than 10% of a registered class of our equity securities (collectively the "Reporting Persons"), to file initial statements of beneficial ownership of securities and statements of changes in beneficial ownership of securities with respect to our equity securities with the SEC. All Reporting Persons are required by SEC regulations to furnish us with copies of all Section 16(a) reports that they file. As with many public companies, we provide assistance to our directors and executive officers in making their Section 16(a) filings pursuant to powers of attorney granted by our insiders.

To our knowledge, based solely on our review of the copies of Section 16(a) reports provided to us by such Reporting Persons, including those reports that we have filed on behalf of our directors and executive officers pursuant to powers of attorney, or written representations from certain Reporting Persons we believe that there has been compliance with all Section 16(a) filing requirements applicable to such Reporting Persons with respect to the fiscal year ended December 31, 2022, except one Form 4 for Mr. Brian Linscott, Ms. Kearnes and Mr. Wyman, were each filed late. The failure to file the Form 4s was inadvertent on the part of the Company’s officers and directors. The Company has enhanced its compliance system and level of awareness in order to ensure timely filings moving forward.

Implications of Being a “Smaller Reporting Company”

We qualify as a “smaller reporting company” as such term is defined in Rule 405 of the Securities Act of 1933, as amended (the “Securities Act”), and Item 10 of Regulation S-K. Accordingly, and in accordance with relevant SEC rules and guidance, as a smaller reporting company, we are allowed to take advantage of specified exemptions and reduced disclosure obligations, including with respect to executive compensation disclosure, in our periodic reports and proxy statements.

* Chairman

Members of the Board are generally elected at each annual meeting of the Company’s stockholders to serve until the next annual meeting of the Company’s stockholders.

Brian Linscott has served as the Company’s Chief Executive Officer since June 2021. Mr. Linscott joined the Company as Chief Operating Officer in January 2020.  Mr. Linscott has over two decades of experience advising clients and C-level executives on operational improvements, growth strategies, acquisitions, corporate development and capital structure across a variety of industries including media, manufacturing, and transportation. From 2015 to 2019, he served as a Partner at BR Advisors where he led the operational improvement of radio and printing companies, developed new partnerships, and facilitated asset transactions. He also has served as Operating Partner at Traverse Pointe Partners since 2014, where he advises a private equity fund on financial and operational assessment of equity investments and develops post-acquisition operational strategies to create stockholder value. From 2013 to 2015, Brian served as a Managing Director at Huron Consulting Group (NASDAQ: HURN) where he managed client relationships, oversaw consulting teams, and developed new business opportunities in Huron’s Business Advisory practice.  From 2009 to 2012, Brian served as Chief Financial Officer / Senior Vice President at Sun Times Media, LLC where he created and executed a restructuring plan that led to substantial EBITDA growth, cash flow improvement, and a successful sale of the company.  Mr. Linscott received his B.S. in Finance from the University of Illinois, Urbana.

As the Company’s Chief Executive Officer, Mr. Linscott provides valuable insight to the board on our day-to-day operations. In addition, Mr. Linscott’s significant experience with overseeing operations and consulting teams and in particular his experience developing new business in various industries, provides the Board with valuable insight as the Company grows and returns to profitability.

Genevieve “Genni” Combes has served as a director of Harte Hanks since May 2021.  Ms. Combes currently serves as the CFO at CrowdStreet, Inc. where she leads the finance and financial operations teams.  She has broad experience as a finance and operations executive at both public and private companies. Ms. Combes previously served as CFO at ApplePie Capital, Inc. Prior to that, she served as Vice President, Finance Partner Relations and Operations at Sungevity and the Senior Vice President at ZipRealty. Earlier in her career, Ms. Combes served as a Managing Director and Sr. Equity Analyst at J.P. Morgan (NYSE: JPM) and Hambrecht & Quist where she led the e-commerce and consumer research groups.

We believe Ms. Combes’ experience in leading the finance, financial planning and financial operations teams at a number of different entities, as well as her experience as a senior equity analyst at a number of different investment banks, will provide valuable expertise to the Board.

David L. Copeland  has served as a director of Harte Hanks since 1996.  He has been employed by SIPCO, Inc., the management and investment company for the Andrew B. Shelton family, since 1980, and currently serves as its President.  Since 1998, he has served as a director of First Financial Bankshares, Inc. (NASDAQ: FFIN), a financial holding company.  Currently, he serves on the executive, risk and nominating committees and is also the audit committee chairman of First Financial Bankshares.

We believe that Mr. Copeland’s qualifications for our Board include his experience serving on various committees for a publicly traded financial holding company.  We also believe he offers us extensive knowledge of financial instruments, financial and economic trends and accounting expertise from serving as President of SIPCO, Inc. and on the audit committee of First Financial Bankshares.  Mr. Copeland, a certified public accountant and a chartered financial analyst, would qualify as a financial expert for our audit committee.

John H. “Jack” Griffin, Jr. has served as a director of Harte Hanks since July 2018.  In April 2021, he was appointed as the Company’s Chairman of the Board. From April to December of 2019, he served as Vice Chairman and Chairman of the Operations Committee of Harte Hanks.  Prior to that, he was a member of the Harte Hanks Office of the Chief Executive Officer (the “Office of the CEO”) from August 2018 to January 2019. Mr. Griffin is currently the Operating Chairman of Magazines at Dotdash Meredith, a subsidiary of IAC (NASDAQ: IAC). From 2018 to 2021 he was the Chairman of the Board of Dennis Publishing, a London-based firm owned by Exponent, a UK Private Equity Fund. Dennis Publishing was sold to Future PLC in October 2021.   From 2016 to 2018 Mr. Griffin served as Managing Director at Oaklins DeSilva+Phillips, an advisory firm in New York City focused on mid-market M&A transactions, valuations and restructurings for firms in media, marketing services, information, education and health care communications. Previously, as CEO and director of Tribune Publishing Company (from 2014-2016), Mr. Griffin led the spin-off of the Tribune Publishing Company’s Newspaper Division into a separate publicly traded company. Before Tribune, Mr. Griffin founded and served as CEO of Empirical Media LLC, a consulting firm that assisted legacy media companies with digital transition, restructuring and strategic planning, from 2011-2014. Mr. Griffin was previously CEO of Time Inc. and spent a dozen years at Meredith Corporation in senior executive capacities.

We believe that Mr. Griffin’s qualifications for our Board include his proven success as both an operator and advisor to companies undergoing restructuring and reengineering solutions, along with his demonstrated record of achieving and exceeding financial targets in demanding private and public company environments. In addition, the experience Mr. Griffin gained as a member of the Office of the CEO and Chairman of the Operations committee enables him to provide the Board with additional insight into the Company’s operations, strategic initiatives and personnel.

Bradley L. Radoff has served as a director of Harte Hanks since May 2021.  Mr. Radoff currently serves as a private investor and as Principal of Fondren Management LP, a private investment management company, and has held such positions since 2005.  Mr. Radoff previously served as a Portfolio Manager at Third Point LLC, a registered investment advisor firm, from 2006 to 2009.  He also served as Managing Director of Lonestar Capital Management LLC, a registered investment advisory firm, from 2003 to 2004. Mr. Radoff served as a director of Citadel Investment Group LLC, a global financial institution, from 2000 to 2003.  Mr. Radoff has served as a director of Farmer Brothers Co. (NASDAQ: FARM), a coffee roaster and wholesale equipment servicer and distributer of coffee, tea and allied products, since October 2022;  as a director of Enzo Biochem, Inc. (NYSE: ENZ), an integrated diagnostics, clinical lab and life sciences company, since January 2022.  Mr. Radoff served as a director of VAALCO Energy Inc (NYSE: EGY), a Texas-based independent energy company, from June 2020 to January 2022; Support.com (formerly NASDAQ: SPRT), a leading provider of cloud-based software and services, from June 2016 until its merger in September 2021, and Page Producing Company (formerly NYSE: PPP), an oil and gas exploration, development and production company, from March 2007 until the completion of its sale to Plains Exploration & Production Company in November 2007. Mr. Radoff graduated summa cum laude with a B.S. in Economics from The Wharton School, University of Pennsylvania.

We believe that Mr. Radoff’s qualifications for our Board include his experience serving on the boards of directors for several publicly traded companies and his extensive experience in finance and working with technology. Mr. Radoff’s experience as Principal of a private investment management company provides valuable expertise in management and finance. Mr. Radoff is also a significant shareholder which the Board believes will be valuable as it continues to develop its strategic view for the Company.

The following persons are our current executive officers and hold the positions set forth below:

For biographical information about Brian Linscott, our Chief Executive Officer, see the table above in this “Directors and Executive Officers” section. 

Laurilee Kearnes has served as the Company’s Chief Financial Officer since November 15, 2019.  Ms. Kearnes previously served as the Company’s Principal Accounting Officer and Vice President, Finance and Controller from August 2018 to November of 2019. Ms. Kearnes has over 25 years of experience in accounting and finance roles, including the last 20 years with Harte Hanks in various positions including Group Controller, VP Finance, and Group VP Finance, Accounting Shared Services.  Ms. Kearnes started her career in public accounting and held accounting positions with Nutraceutical Corp. and Brooks Automation prior to joining the Company. She holds a Bachelor of Science in Accounting and a Master of Accounting from Utah State University.

Robert T. Wyman has served as General Counsel at Harte Hanks since 2021.  Mr. Wyman is responsible for all legal, regulatory, and corporate governance activities for the domestic and international businesses of the Company.  Prior to serving as General Counsel, Mr. Wyman acted as Corporate Counsel for the Company beginning in 2011, and concurrent with this service, also served (in private practice) as the founding partner and as of counsel for Wyman & Barton, p.a. During his tenure at Wyman & Barton, Mr. Wyman’s practice centered on real estate, and civil and criminal litigation. Mr. Wyman also previously served on the Board of Directors of Georgetown Bank, and on the Board of Directors of several charitable/ non-profit organizations including the Lowell Massachusetts Boys and Girls Club, New Wave Swim Club, and as an advisor to the Merrimack Valley Housing Partnership, Project Genesis. An attorney practicing for more than 32 years, Mr. Wyman is a graduate of the University of Massachusetts | Lowell (1985, B.S. Business Management), and New England Law | Boston (1990, Juris Doctorate). 

CORPORATE GOVERNANCE

We believe that strong corporate governance helps to ensure that our company is managed for the long-term benefit of our stockholders.  We continuously review our corporate governance policies and practices, the applicable federal securities laws regarding corporate governance, and the corporate governance standards of NASDAQ, the stock exchange on which our common stock is listed, to ensure compliance with all applicable laws and regulations and we will contemplate any changes to what is considered best practices for corporate governance even if such changes are not required by relevant laws and regulations or NASDAQ. This review is part of our continuing effort to enhance our corporate governance and to communicate our governance policies to stockholders and other interested parties.

You can access and print, free of charge, the charters of our Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee, as well as our Corporate Governance Principles, Business Conduct Policy, Code of Ethics and certain other policies and procedures on our website at www.hartehanks.com under the “Governance” tab of our “Investors Relations” section.   The information on our website is not incorporated by reference and is not part of this proxy statement.  Additionally, stockholders can request copies of any of these documents free of charge by writing to the following address:

Harte Hanks, Inc. (Attention: Secretary)

1 Executive Drive, Suite 303

Chelmsford, MA 01824

From time to time, these governance documents may be revised in response to changing regulatory requirements, our evaluation of evolving best practices and industry norms and input from our stockholders and other interested parties. We encourage you to check our website periodically for the most recent versions.

Board of Directors and Board Committees

Our business and affairs are managed under the direction of the Board. The Company’s By-laws provide that the Board will consist of the number of directors designated by the Board from time-to-time, and, in the absence of such designation, the Board will consist of seven (7) directors.  Currently, the Board has five (5) directors, including the CEO. 

The Board elects the principal executive officer and other corporate officers, acts as an advisor to and as a resource for management, and monitors management’s performance. The Board, with the assistance of the Compensation Committee, also assists in planning for the succession of the principal executive officer and certain other key positions. In addition, the Board oversees the conduct of our business and strategic plans to evaluate whether the business is properly being managed, and reviews and approves our financial objectives and major corporate plans and actions. Through the Audit Committee, the Board reviews and approves significant changes in the appropriate auditing and accounting principles and practice and provides oversight of internal and external audit processes, financial reporting and internal controls.

Our Board of Directors has established an Audit Committee, a Compensation Committee and Nominating and Corporate Governance Committee, which have the composition and responsibilities described below. Each committee operates under a charter that has been approved by the Board of Directors.

Majority Voting Provisions of the Company’s Bylaws

On July 17, 2019, the Board adopted Amendment No. 2 (the “Amendment”) to the Fifth Amended and Restated Bylaws of the Company. The Amendment amends Article I, Section 8 of the Bylaws to provide for the resignation of any director who fails to receive a majority of votes cast in favor of his or her election at an annual meeting of the stockholders (assuming that the election is uncontested) (the “Majority Voting Provision”). Under the Majority Voting Provision, each nominee is required to submit an irrevocable resignation, which resignation would become effective upon (1) that person not receiving a majority of the votes cast in favor of his or her election in an uncontested election and (2) acceptance by the Board of that resignation in accordance with the policies and procedures adopted by the Board for such purpose. The Board, acting on the recommendation of the Nominating and Corporate Governance Committee, is required to determine whether or not to accept the resignation not later than 90 days following certification of the stockholder vote, and the Board is required to accept the resignation absent a determination that a compelling reason exists for concluding that it is in the best interests of the Company for the person in question to remain as a director.

In connection with the adoption of the Amendment, the Board also adopted revisions to the Company’s Corporate Governance Principles and Nominating and Corporate Governance Committee Charter to implement the Majority Voting Provision and set forth the procedures governing the resignation of directors who do not receive a majority of the votes cast in an uncontested election.

Audit Committee

We have a separately designated standing Audit Committee established in accordance with Section 3(a)(58)(A) of the Exchange Act. The Audit Committee is currently comprised of Ms. Combes and Messrs. Griffin and Radoff, each of whom served throughout 2022.  Ms.Combes is presently the Audit Committee Chair and she is considered an “audit committee financial expert,” as currently defined under the SEC and NASDAQ rules.

Our Board has determined that all the Audit Committee members are independent within the meaning of the applicable SEC rules and the listing standards of NASDAQ as such requirements apply to members of audit committees and meet the financial literacy requirements of the NASDAQ.

The primary function of the Audit Committee is to assist the Board in fulfilling its oversight of (1) the integrity of our financial statements, including the financial reporting process and systems of internal controls regarding finance, accounting, and legal compliance, (2) the qualifications and independence of our independent auditors, (3) the performance of our internal audit function and independent auditors, and (4) our compliance with legal and regulatory requirements.

The Audit Committee’s role is one of oversight. Management is responsible for preparing the Company’s financial statements and the independent registered public accounting firm is responsible for auditing those financial statements. Management, including the internal audit staff, or outside provider of such services, and the independent registered public accounting firm have more time, knowledge and detailed information about the Company than do Audit Committee members. Consequently, in carrying out its oversight responsibilities, the Audit Committee will not provide any expert or special assurance as to the Company’s financial statements or any professional certification as to the independent registered public accounting firm’s work.

Compensation Committee

The Compensation Committee is currently comprised of Messrs. Radoff and Griffin and Ms. Combes, each of whom also served throughout 2022. Mr. Radoff is presently our Compensation Committee Chair.

The primary functions of the Compensation Committee are to (1) review and approve corporate goals and objectives relevant to principal executive officer compensation, evaluate the principal executive officer’s performance in light of those goals and objectives, and together with the other independent directors (as directed by the Board), determine and approve the principal executive officer’s compensation level based on this evaluation, (2) review and recommend to the Board (as directed by the Board) non-principal executive officer compensation, incentive-compensation plans and equity-based plans, and (3) to the extent such disclosure is required, review and discuss with management the Company’s “Compensation Discussion and Analysis” and produce a committee report on executive compensation as required by the SEC to be included in our annual proxy statement or Annual Report on Form 10-K filed with the SEC.

In addition, the Compensation Committee may delegate power and authority to a subcommittee, provided that the subcommittee consists of at least two members and the Compensation Committee does not delegate any power or authority required to be exercised by the Compensation Committee as a whole.

Nominating and Corporate Governance Committee

The Nominating and Corporate Governance Committee is currently comprised of Messrs. Radoff, Griffin and Ms. Combes, each of whom also served throughout 2022. Mr. Griffin is presently our Nominating and Corporate Governance Committee Chair.  

The primary functions of the Nominating and Corporate Governance Committee are to (1) develop, recommend to the Board, implement and maintain our Company’s corporate governance principles and policies, (2) identify, screen and recruit, consistent with criteria approved by the Board, qualified individuals to become Board members, (3) recommend that the Board select the director nominees for the next annual meeting of stockholders, (4) assist the Board in determining the appropriate size, function, operation and composition of the Board and its committees, and (5) oversee the evaluation of the Board and management.

Director Candidates

The Nominating and Corporate Governance Committee is responsible for managing the process for the nomination of new directors and considers nominations from its stockholders made pursuant to Section 1.3 of our Fifth Amended and Restated By-Laws (the “Bylaws”). The Nominating and Corporate Governance Committee may identify potential candidates for first-time nomination as a director using a variety of sources, including recommendations from current Board members, our management, stockholders or contacts in communities served by Harte Hanks, or by conducting a formal search using an outside search firm selected and engaged by the Nominating and Corporate Governance Committee.

Following the identification of a potential director nominee, the Nominating and Corporate Governance Committee commences an inquiry to obtain sufficient information on the background of such potential new director nominee. Included in this inquiry is an initial review of the candidate with respect to whether the individual would be considered independent under all applicable rules and whether the individual would meet any additional requirements imposed by law or regulation on the members of the Audit and Compensation Committee. The Nominating and Corporate Governance Committee evaluates candidates for director nominees in the context of the current composition of the Board, taking into account all factors it considers appropriate, including independence, diversity, age, skills, background and experience, financial acumen, availability of service to Harte Hanks, tenure of incumbent directors on the Board and the Board’s anticipated needs. Candidates should also have the skills and fortitude to assess and challenge the current status quo and recommend alternative solutions; in the case of independent directors, the independence necessary to make an unbiased evaluation of management performance and effectively carry out oversight responsibilities; an awareness of both the business and social environment in which the Company operates; and a sense of urgency and spirit of cooperation that will enable them to interact with other Board members in directing the future and profitable growth of the Company. The Nominating and Corporate Governance Committee has determined that it is desirable for the Board to have variety in perspectives, professional experiences, educational background, skills, race, gender and age, and considers issues of diversity and background in determining the appropriate composition of the Board and identifying director nominees. However, the Company does not have a formal policy concerning diversity considerations, nor does the Company have any formal means of assessing the efficacy of its diversity considerations. We are committed to inclusiveness and as such, when searching for director nominees, the Nominating and Corporate Governance Committee endeavors to include highly qualified diverse candidates in the pool from which nominees are chosen.

The Nominating and Corporate Governance Committee will consider potential nominees recommended by our stockholders taking into account the same characteristics considered for all other potential nominees. Stockholders may recommend candidates by writing to the Nominating and Corporate Governance Committee at the attention of our Secretary at Harte Hanks, Inc., 1 Executive Drive, Suite 303, Chelmsford, MA 01824. Our Bylaws provide additional procedures and requirements for stockholders wishing to nominate a director for election as part of the official business to be conducted at an annual stockholders meeting, as described further under “Submission of Stockholder Proposals for 2024 Annual Meeting” and in our Bylaws. Stockholders wishing to submit nomination recommendations to the Nominating and Corporate Governance Committee should review Section 1.3 of our Bylaws in their entirety as the director nomination process described herein is incomplete.

Assuming a satisfactory conclusion to the Nominating and Corporate Governance Committee’s review and evaluation process, the Nominating and Corporate Governance Committee presents the candidate’s name to the Board for nomination for election as a director and, if applicable, inclusion in our proxy statement.

Board Meetings and Attendance

The Board held ten meetings and acted by unanimous written consent nine times during the fiscal year ended December 31, 2022. In addition, the Audit Committee held four meetings, the Compensation Committee held two meetings and the Nominating and Corporate Governance Committee held one meeting during the fiscal year ended December 31, 2022. Although the Company does not have a formal policy regarding director attendance at the annual meeting of stockholders, all directors are encouraged to attend. All directors who served on the Board during the fiscal year ended December 31, 2022 attended at least 75% of the Board and applicable committee meetings held.

Board Leadership Structure and Self-Evaluation

The Board believes that there is no single organizational model that would be most effective in all circumstances.  Our Corporate Governance Principles currently provide the roles of Chairman of the Board and CEO may be filled by the same or different individuals, which gives the Board the flexibility to determine whether these roles should be combined or separated based on the Company’s circumstances and needs at any given time. The Nominating and Corporate Governance Committee regularly evaluates whether to combine or separate the roles of the principal executive officer and Chairman, especially in connection with changes in leadership.

In April 2021, the Board evaluated its leadership structure and determined that the most effective leadership structure was to have separate individuals serve as CEO and Chairman of the Board.  In connection with this decision, Mr. John H. Griffin, Jr. was elected Chairman of the Board in April 2021, and has served in such capacity since that time.  The Board re-evaluated this decision in April 2022 and determined not to change its leadership structure. Separating these positions allows the Chief Executive Officer to focus on the full-time job of running the Company’s business, while allowing the Chairman to lead the Board in its fundamental role of providing advice to, and independent oversight of management.  The Board also believes that separating the Chairman and Chief Executive Officer positions provides enhanced independent leadership and oversight for the Company, management, and the Board.  As of the 2023 annual meeting date, Mr. Griffin continues to serve as the Chairman of the Board.     

On an annual basis, the Board conducts an informal evaluation to determine whether it and its committees are functioning effectively. As part of this self-evaluation, the Board reviews whether the current leadership structure continues to provide the best representation for the Company, and for its stockholders. Our corporate governance principles provide the flexibility for our Board to modify or continue our current leadership structure in the future, as it deems appropriate, in light of the results of evaluations or on-going business needs.  

Executive Sessions

Our Corporate Governance Principles provide that the non-management members of the Board will hold regular executive sessions in connection with regular Board meetings to consider issues that they may determine from time to time without the presence of any member of management. If the Chairman of the Board is not a member of management, the Chairman will chair each such session and report any material issues to the full Board. If the Chairman is a member of management, the Lead Independent Director serves as the chairman of the executive sessions.  In 2022, these sessions were presided over by Mr. Griffin as Chairman of our Board.  If the non-management directors include directors who are not “independent” under applicable SEC rules, then the independent directors will hold an executive session at least once a year. The Chairman of the Board, if an independent director, chairs each such session and reports any material issues to the full Board. If the Chairman is not an independent director, the Lead Independent Director serves as the chairman of such sessions.  We believe having a majority of independent, experienced directors on our Board benefits the Company and its stockholders by providing strong oversight and advice on the issues facing the Company.

Risk Oversight

Our Board is responsible for overseeing the risk management process. The Board focuses on risk management strategy and the most significant risks we face and ensures that management implements appropriate risk mitigation strategies. The Board is also apprised of particular risk management matters in connection with its general oversight and review of corporate matters.

In performing the risk management process, the Board reviews with management (1) our policies with respect to risk assessment and management of risks that may be material to us, (2) our system of disclosure controls and procedures and system of internal controls over financial reporting, and (3) our compliance with legal and regulatory requirements. The Board also discusses major legislative and regulatory developments that could materially impact our contingent liabilities and risks. Our Board committees also consider and address risk as they perform their respective committee responsibilities. For example, our Compensation Committee evaluates the risks associated with our compensation plans and policies, and our Audit Committee monitors risks relating to our financial controls and reporting. All committees report to the full Board as appropriate, including when a matter rises to the level of a material or enterprise level risk. The leadership structure of our Board described above under the section heading “Board Leadership Structure” ensures that management is properly overseen by independent directors.

Management is responsible for day-to-day risk management. Our finance, treasury, general counsel and internal audit functions serve as the primary monitoring and testing groups for company-wide policies and procedures and manage the day-to-day oversight of the risk management strategy for our ongoing business. This oversight includes identifying, evaluating and addressing potential risks that may exist at the enterprise, strategic, financial and operational levels, as well as compliance and reporting.

Since 2021, in recognition of the unique and evolving risks posed by cybersecurity and data protection, the Board determined to delegate to the Audit Committee the responsibility of overseeing risks related to cybersecurity, data protection (including confidential, proprietary and personal information, reputation and goodwill in all forms) and other similar risks. The Audit Committee is also responsible for overseeing and assisting in the establishment of policies and procedures to mitigate such risks. For instance, the Company maintains a global set of security policies and standards and regularly evaluates response readiness, disaster recovery or business continuity considerations. In addition, all employees receive annual cybersecurity and phishing training.  The Audit Committee Charter was amended to update the committee’s scope of responsibility to include overseeing such risks.

We believe the division of risk management responsibilities described above is an effective approach for addressing the risks facing the Company and that our Board leadership structure supports this approach.

Stockholder Communications with the Board of Directors

Stockholders may send communications to our Board, including any individual director or the directors as a group, by mailing such communications to Harte Hanks, Inc., Attn: Corporate Secretary, 1 Executive Drive, Suite 303, Chelmsford, MA 01824.  Such correspondence shall be addressed to the Board or any individual director by either name or title.

All communications received as set forth in the preceding paragraph will be opened by our Corporate Secretary or the secretary’s designee for the sole purpose of determining whether the contents represent a message to our directors. Any contents that are not in the nature of advertising, promotions of a product or service, or patently offensive material will be forwarded promptly to the addressee. In the case of communications to our Board or any individual director, our Corporate Secretary will make sufficient copies of the contents to send to each director to which the envelope is addressed. 

Director Attendance at Annual Meetings

Although we do not have a formal policy regarding director attendance at the annual meeting of stockholders, all directors are encouraged to attend.  All directors serving on the Board during the fiscal year ended 2022 attended the 2022 annual meeting of stockholders, and all current directors plan to virtually attend the 2023 Annual Meeting.

Code of Business Conduct and Ethics

We have established a corporate compliance program as part of our commitment to responsible business practices in all of the communities in which we operate. The Board has adopted a Business Conduct Policy that applies to all of our directors, officers and employees, which promotes the fair, ethical, honest and lawful conduct in our business relationships with employees, customers, suppliers, competitors, government representatives, and all other business associates. In addition, we have adopted a Code of Ethics applicable to our Chief Executive Officer and all of our senior financial officers. The Business Conduct Policy and Code of Ethics Policy form the foundation of a compliance program that includes policies and procedures covering a variety of specific areas of professional conduct, including compliance with laws, conflicts of interest, confidentiality, public corporate disclosures, insider trading, trade practices, protection and proper use of company assets, intellectual property, financial accounting, employment practices, health, safety and environment, and political contributions and payments. The Business Conduct Policy forbids employees and directors from engaging in hedging activities with respect to our securities.

Both our Business Conduct Policy and our Code of Ethics Policy are available on our website at www.hartehanks.com, under the “Governance” subsection of our “Investor Relations” section. In accordance with NASDAQ and SEC rules, we intend to disclose on our website any future amendments to our Code of Ethics, or waivers from our Code of Ethics for our Chief Executive Officer or Chief Financial Officer.

Hedging Policy

The Company’s Business Conduct Policy forbids employees and directors from engaging in hedging activities or similar arrangements with respect to our securities. As of the date of this proxy statement, management of the Company is not aware of any hedging activities by Company insiders involving the Company’s securities.