DEF 14A of Fulgent Genetics, Inc., Mar 25, 2025

DEF 14A of Fulgent Genetics, Inc.

Filed Mar 25, 2025 · FY20240000950170-25-044407

Open on EDGAR

  1. Our Board of Directors

    Our Board of Directors Our Board of Directors accepted the recommendation of the Nominating committee (defined below) and voted to nominate Ming Hsieh, Linda Marsh, Michael Nohaile, Ph.D., and Regina Groves for election at the Annual Meeting for a term of one year to serve until the 2026 Annual Meeting of Stockholders (the “2026 Annual Meeting”), and until their respective successors have been elected and qualified. There are no arrangements or understandings between any of our directors and any other person pursuant to which such individual was or is selected as a director of our Company. Set forth below and following are the names of the persons nominated for election as directors, their biographical summaries, their ages as of March 25, 2025, their offices in the Company, if any, their principal occupations or employment for at least the past five years, the length of their tenure as directors and the names of other public companies in which such persons hold or have held directorships during the past five years as of March 25, 2025. Additionally, information about the specific experience, qualifications, attributes or skills that led to our Board of Directors’ conclusion at the time of filing of this proxy statement that each person listed below should serve as a director is set forth below:

  2. Our Board of Directors

    | Name | Age | Position with the Company | | Ming Hsieh | 69 | Chief Executive Officer and Chairperson of the Board | | Linda Marsh | 75 | Director | | Michael Nohaile, Ph.D. | 56 | Director | | Regina Groves | 66 | Director |

  3. Our Board of Directors

    Our Board of Directors has reviewed the materiality of any relationship that each of our directors has with Fulgent Genetics, Inc., either directly or indirectly. Based upon this review, our Board has determined that the following members of our Board of Directors are “independent directors” as defined by The Nasdaq Stock Market (“Nasdaq”): Linda Marsh, Michael Nohaile, Ph.D., and Regina Groves. Ming Hsieh, our founder, served as the manager of our predecessor, Fulgent Therapeutics LLC (“Fulgent LLC”), from its inception in June 2011 until September 2016. Upon our incorporation in May 2016, he was appointed as our director and Chief Executive Officer, and in September 2016, in connection with our initial public offering, he was appointed Chairperson of our Board. Mr. Hsieh also served as the President of the Company from its inception until May 2022. From January 2019 to January 2024, Mr. Hsieh served as the Chief Executive Officer of Fulgent Pharma Holdings, Inc. (“Fulgent Pharma”), a clinical stage pharmaceutical company focused on developing and commercializing innovative cancer therapeutics and a subsidiary of the Company. Prior to founding our Company, Mr. Hsieh served as Chief Executive Officer, President and Chairperson of the board of directors of Cogent, Inc. (“Cogent”), a biometric identification services and products company he co-founded in 1990, which was acquired by 3M Company in 2010. Prior to his tenure at Cogent, Mr. Hsieh founded and served as Vice President of AMAX Technology from 1987 to 1990. Mr. Hsieh currently serves on the board of directors of Fortinet, Inc., a network security company traded on the Nasdaq Global Select Market. Mr. Hsieh received a B.S.E.E. from the University of Southern California in 1983 and an M.S.E.E. from the University of Southern California in 1984, as well as honorary doctoral degrees from the University of Southern California in 2010 and the University of West Virginia in 2011. Mr. Hsieh has served as a trustee at the University of Southern California since 2007 and at Fudan University in China since 2011. In 2015, Mr. Hsieh was elected to the National Academy of Engineering. In 2017, Mr. Hsieh was elected to the National Academy of Inventors. Mr. Hsieh was selected to serve on our Board based on his extensive management experience, his knowledge of our business, culture and operations as our founder, his engineering expertise and his service for and leadership of our Company since inception. Linda Marsh was appointed to serve on our Board in August 2019. Ms. Marsh has been a member of the Board of Directors of Apollo Medical Holdings, Inc. since January 2019 and the Senior Executive Vice President of Health Source MSO Inc., an organization that provides health management and administrative support services, since 2005. She is also the Senior Executive Vice President of AHMC Healthcare Inc. (“AHMC Healthcare”), a fully integrated hospital health system in Southern California with over 1,200 acute care beds and over 7,000 caregivers. She joined AHMC Healthcare in 1999 and oversees all financial matters for 10 acute care facilities: San Gabriel Valley Medical Center, Garfield Medical Center, Anaheim Regional Medical Center, Whittier Hospital Medical Center, Alhambra Hospital, Monterey Park Hospital, Greater El Monte Community Hospital, and Seton Medical Center. Additionally, Ms. Marsh is responsible for all federal, state and local government relations, as well as all risk management activities. Ms. Marsh is a member of the board of directors of the Hospital Association of Southern California, a member of the board of directors of Private Essential Access Community Hospitals and also a Board member of the American Red Cross. She is also an active member in the Healthcare Financial Management Association. In addition, she chairs or is a participating member of numerous hospital governing boards, hospital committees and community organizations. Ms. Marsh received a Bachelor of Science degree in Economics and a Master’s degree in Accounting from the University of Southern California. She also completed a Healthcare Executive Program at the University of Colorado. Ms. Marsh was selected to serve on our Board based on her extensive expertise within the healthcare field, as well as her educational and professional background. Michael Nohaile, Ph.D., was appointed to serve on our Board in August 2022. Dr. Nohaile currently serves as the Chief Executive Officer and a member of the board of directors of Prellis Biologics, a company harnessing the human immune system for the discovery and development of novel therapeutics. Prior to his current role, he was the Chief Scientific Officer of Generate Biomedicines, Inc. (“Generate”), a drug discovery and development company pioneering a machine learning-powered biomedicine platform, from May 2021 to July 2022. Prior to joining Generate, Dr. Nohaile served as an Operating Partner at Flagship Pioneering, Inc., a life science venture capital company, from February 2021 to May 2021. Additionally, Dr. Nohaile held several roles of increasing responsibility at Amgen Inc. (“Amgen”), a biotechnology company which discovers, develops, manufactures, and markets innovative human medicines to treat patients suffering from serious diseases, from December 2012 to February 2021, where he was most recently Senior Vice President of Strategy, Commercialization, and Innovation. In this role, he served on Amgen’s executive committee and led corporate strategy efforts, the commercialization process, portfolio management, and all of Amgen’s data, digital health, and artificial intelligence efforts. This included portfolio management of the $4 billion research and development budget, as well as direct supervision of the leaders of all drug programs from late research to late lifecycle management. Prior to Amgen, Dr. Nohaile was at Novartis AG in Switzerland where he was Global Head of Molecular Diagnostics from December 2008 to November 2012. He began his career at McKinsey & Company, Inc., where he was a Partner and worked extensively in healthcare with a focus on diagnostics, devices, and pharmaceuticals. Dr. Nohaile received his Ph.D. in Molecular and Cell Biology from the University of California, Berkeley and completed his postdoctoral fellowship at the Massachusetts Institute of Technology (“MIT”). He received his undergraduate degrees in Chemistry and Life Science from MIT. Dr. Nohaile was selected to serve on our Board based on his extensive expertise within the pharmaceutical and biotechnology industries, as well as his educational and professional background.

  4. Our Board of Directors

    Regina Groves was appointed to serve on our Board in January 2023. Ms. Groves has been a member of the board of directors of AtriCure, Inc., a publicly traded company, since March 2017, and she currently serves on the board of directors of three private medical device companies. Previously, Ms. Groves served on the board of directors of Stimwave, LLC, a medical device company, from July 2019 to December 2022, and she was also its Chief Financial Officer and Chief Operating Officer from September 2019 to December 2020 and from November 2019 to December 2020, respectively. Prior to Stimwave, LLC, Ms. Groves was the Chief Executive Officer at REVA Medical, Inc., a medical device company, from September 2015 to March 2019. Ms. Groves also previously served as Vice President and General Manager of AF Solutions in the Cardiac Rhythm and Heart Failure division of Medtronic, Inc., a medical device company. In this position, she successfully developed and executed strategies to re-enter the catheter-based Afib ablation market and achieved the goal to be market leader in paroxysmal Afib ablation. Additionally, Ms. Groves successfully acquired and integrated companies, completed numerous clinical trials and launched novel products in the United States and worldwide. Prior to this, she was the Vice President of Quality and Regulatory for Medtronic’s Cardiac Rhythm Disease Management (“CRDM”) and before that was Vice President and General Manager for Patient Management CRDM. Ms. Groves holds a B.S. in Pharmacy from the University of Florida and an M.B.A. from Harvard Graduate School of Business Administration. Ms. Groves was selected to serve on our Board based on her accounting and financial expertise, as well as her extensive senior management experience and public company board experience in the medical device, hospital, insurance, physician practice management, pharmaceuticals, and professional services industries.

  5. Compensation Philosophies and Objectives

    Compensation Philosophies and Objectives The goal of our executive compensation philosophy is to deliver competitive levels of total compensation that attract and retain top leadership talent, with primary emphasis on pay for performance. Guiding principles that influence the structure and level of compensation for executive officers are: • To reward the executive management team as a group for the financial performance of the Company, and to also reward for individual performance; • To have the level of total compensation opportunity for each individual executive officer reflect the relative level of job responsibility, market pay, and expected impact on the current and long-term performance of the Company; • To have a significant portion of total direct compensation be at risk, with the opportunity for executive officers to earn correspondingly meaningful and competitive amounts of compensation relative to performance that drives growth in stockholder value; To expect executive officers to retain a meaningful level of ownership in Company stock as a means of aligning the interests of management with those of stockholders; To structure incentive compensation with a focus on management achieving annual financial objectives in a manner that supports and drives the Company’s long-term success and profitability; and To have elements of compensation other than direct pay, including perquisites, personal benefits, or protection agreements serve a balance of interests among executives, the Company, customers, and stockholders. Specifically, the objective is to target base salary at approximately the 50th percentile (i.e., median) of market pay. Variable incentive pay is earned based on performance that is measured over short-term and long-term periods. Target award levels are designed to deliver competitive total direct compensation (i.e., annual cash compensation plus long-term incentive compensation) in comparison to the Company’s peer group (refer to the subsection entitled “General Procedures and Benchmarking” below for a discussion of peer group composition and how market pay is defined for our NEOs). Awards earned are dependent upon achievement of planned performance levels.

  6. General Procedures and Benchmarking

    General Procedures and Benchmarking The Compensation committee reviews all aspects of cash and long-term incentive compensation for executive officers pursuant to its committee charter. Risk Assessment and Mitigation In accordance with its established practice, the Compensation committee met in February 2024 to conduct its annual review of the Company’s compensation policies and practices to assess risks reasonably likely to have a material adverse effect on the Company. We believe that our current policies and practices do not promote excessive risk taking and adequately manage these risks which we believe are mitigated by the polices described below. • Insider Trading Policy: Our insider trading policy is distributed on an annual basis to all employees and to all new employees. This policy applies to our officers, directors, employees, and consultants who may come into possession of material non-public information. This policy requires consent of a designated compliance officer prior to entry into any 10b5-1 trading plan and prohibits entry into any plan while in possession of material non-public information. Trades for our executive officers must also be precleared. • Hedging and Pledging: Our insider trading policy also permits pledging and hedging shares of our common stock with the consent of a designated compliance officer. We have consented to our Chief Executive Officer entering into pre-paid forward contracts with respect to 2,550,000 shares of our common stock. These shares represent 8.5% of our then issued and outstanding shares of common stock. We have also previously permitted share pledges as noted in the section entitled “Security Ownership of Certain Beneficial Owners and Management.” When evaluating pledging and hedging transactions, we consider a variety of factors, including whether the shares of our common stock were acquired by an officer or director through investment or compensation, the length of time these shares were held, the number of pledged or hedged shares as compared to the total number of our issued and outstanding shares of our common stock and the likelihood, based on facts and circumstances available at the time, of those shares being foreclosed upon. To date, no shares have been foreclosed upon pursuant to these arrangements. Claw-Back Policy: We originally adopted a “claw-back” or recoupment policy in March 2022 pursuant to which we may seek to recoup certain compensation, including equity compensation, from executive officers in the event the Compensation committee determines that an executive officer engaged in serious misconduct, or, in certain circumstances, this executive officer failed to supervise a subordinate employee who engaged in serious misconduct and this misconduct resulted in a material violation of law or a violation of a written Company policy that caused us significant financial or reputational harm. In October 2023, we amended our policy to also provide for the mandatory reimbursement or recovery, from current and former officers, of excess incentive-based compensation that was erroneously awarded during the three years preceding the date that the Company is required to prepare an accounting restatement, including to correct an error that would result in a material misstatement if the errors were corrected in the current period or left uncorrected in the current period. Compensation Program Risk Management: Our Compensation committee believes that the following features of our executive compensation program help to mitigate risk. o Compensation mix (as described further below) consists of a balanced mix of short-term, medium-term, and long-term compensation. o Equity grants generally have extended vesting periods designed to encourage executives to value and focus on long-term performance. o Annual incentive awards and performance milestones are determined on an annual basis in the discretion of the Compensation committee. o Caps on the maximum payment under our annual cash incentive plan and our stock incentive compensation plan. Role of Chief Executive Officer The Compensation committee seeks input and recommendations from Mr. Hsieh, Chief Executive Officer, regarding base salary, annual incentive award levels, and long-term incentive grants for the executive officer group (other than himself). Mr. Hsieh makes these recommendations based on guidelines provided by the Compensation committee and judgments regarding individual performance. Mr. Hsieh is not involved with any aspect of determining his own pay. Role of Compensation Consultant The Compensation committee also retains an independent compensation consultant to assist in evaluating Mr. Hsieh’s recommendations and the Company’s executive compensation program. USI, an independent human resources consulting firm, was retained to obtain benchmark data and assist in the design and development of the Company’s executive compensation. The Compensation committee has considered the independence of USI in light of SEC rules and Nasdaq listing standards. In connection with this process, the Compensation committee has reviewed, among other items, a letter from USI that addresses the independence of USI and the members of the consulting team serving the committee consider other services provided to the Company by USI, fees paid by the Company as a percentage of USI total revenue, any business or personal relationships between members of the USI consultant team with members of the committee, stock of the Company owned by members of the USI consultant team or any immediate family members, and any business or personal relationships between the executive officers of the Company and members of the USI consultant team. The Compensation committee discussed these considerations and concluded that the work performed by USI and the members of the consulting team did not raise any conflicts of interest. Benchmarking The Compensation committee determines competitive levels of total compensation for executive officers by applying market pay data and prevalence of practice information provided by the compensation consultant to the Compensation committee. Market pay information is used by the Compensation committee to establish and maintain competitive levels of total direct compensation and to determine the level of pay actually delivered to each NEO. Market pay data is applied in setting target levels of: • base salary; • total cash compensation (i.e., base salary plus annual incentive awards); and • total direct compensation (i.e., total cash compensation plus targeted long-term incentive compensation). The Compensation committee also relies on prevalent market practices in assessing the competitiveness and appropriateness of perquisites, personal benefits, deferred compensation, and payments in connection with events that may trigger payments or benefits to executive officers, such as a change-in-control. The peer group market for the Company includes 11 healthcare and diagnostics and research companies. The companies included in the peer group are identified by the compensation consultant and reviewed by the Compensation committee on an annual basis. Peer organizations are located within a multi-state geographic region and are of comparable market capitalization and revenue size to the Company. The companies that are included in the peer group have market capitalization or revenue that are 0.25x to 2.5x that of the Company. The peer group companies remain in the peer group each year to maintain a stable and consistent market pay measure, with additions and deletions occurring when required to assure comparability to the Company and to reflect mergers and acquisitions. The following list includes all peer group companies used for the current period:

  7. General Procedures and Benchmarking

    | Peer Company | Headquarters | | 23andMe Holding Co. | Sunnyvale, CA | | Biodesix, Inc. | Boulder, CO | | CareDx, Inc. | Brisbane, CA | | Castle Biosciences, Inc. | Friendswood, TX | | GeneDx Holdings Corp. | Stamford, CT | | Guardant Health, Inc. | Redwood City, CA | | Myriad Genetics, Inc. | Salt Lake City, UT | | NeoGenomics, Inc. | Fort Myers, FL | | Opko Health, Inc. | Miami, FL | | Pacific Biosciences of California, Inc. | Menlo Park, CA | | Veracyte, Inc. | South San Francisco, CA |

  8. General Procedures and Benchmarking

    The compensation consultant provides the Compensation committee, on an annual basis, with total direct compensation pay amounts delivered by the peer group to each NEO. The source of data applied in the market analysis is the annual proxy reports for each peer company. Market pay data is statistically summarized and presented for the Chief Executive Officer, Chief Financial Officer, and all other Executive Vice President level officers. Market pay data is summarized separately for base salary, total cash compensation, long-term incentive compensation, and total direct compensation. The Compensation committee also uses industry pay data provided by the compensation consultant. This data is sourced from published compensation surveys that report the level of base salary and total cash compensation paid to executives in like positions by companies of comparable revenue size in comparable industries. Market pay data from both the peer group and industry data sources are collectively a primary factor in the Compensation committee’s recommendations to the full Board on setting target levels of base salary, annual incentive awards, and long-term incentive awards; and are taken into account along with performance in determining base pay increases.

  9. Elements of Executive Compensation

    All payments made and benefits available to each executive officer in connection with his or her employment agreement will comply with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), in accordance with the terms of his or her employment agreement. Should any portion of an NEO's severance or other benefits constitute a “parachute payment” under Section 280G of the Code, and therefore become subject to an excise tax under Section 4999 of the Code, then such NEO shall be paid the full amount of severance under the severance agreement on the first business day after the date that is six (6) months following the NEO's termination of employment (or upon the NEO's death, if earlier). Interrelationship Between Compensation Elements Other important interrelationships between elements of total compensation are: • The annual cash incentive plan and the equity based long-term incentive compensation plan reflect a balance of reward for annual profitability, sustained long-term financial performance, and growth in share value. • The policy of requiring retention of any net shares delivered through the long-term incentive compensation plan for at least a one-year period strengthens the alignment of executives with stockholders. • The value of stock awards collectively represents wealth accumulation that will be monitored to assure delivery of reasonable, fair, and competitive compensation that is aligned with the stated executive compensation philosophies. • Payments or benefits triggered by death, disability, termination without cause, or change-in-control share a common purpose of providing a reasonable and fair level of protection against loss of income or benefits in connection with events over which the executive has no control.

  10. Executive Compensation Decisions for 2024

    Base Salary Generally, annual increases to base salary for each NEO are determined based upon the NEO’s current salary relative to the market data and peer group, individual performance, and the Company’s expectations for overall wage expense increases. Larger salary increases may occur when promotions or additional accountabilities create additional value for a specific position or benchmark studies indicate that an adjustment is necessary to maintain market competitiveness. The Board made no increases to annual base salaries in 2024. Base salaries for the Chief Executive Officer, Chief Financial Officer, Chief Scientific Officer, and President and Chief Operating Officer were $1,000,000, $600,000, $513,000, and $615,000, respectively. The base salaries were competitive with the peer group and industry data sources. The decision to not increase base salaries was determined pursuant to the process outlined above. Annual Incentive Pay Plan Target annual incentive awards, expressed as a percentage of base salary, are established before the beginning of the fiscal year period for each executive officer. These award levels correspond to target levels of 100% of base salary for the Chief Executive Officer, and 30% of base salary for all other NEOs. The target incentive award levels set for executive officers reflect the Board’s executive pay objectives explained under the “Compensation Philosophies and Objectives” section. Equity Awards Equity grants made under the 2016 Plan during the 2024 fiscal year were made in the form of time-based RSUs and performance-based RSUs. In determining a reasonable level of long-term incentive compensation to be granted, the Compensation committee considered current total direct compensation relative to the market data and peer group. The 2024 time-based RSU grants vest over a period of three years, with 1/3rd of such shares vesting 12 months after the vesting commencement date, February 26, 2024, and 1/12th of such shares vesting at the end of every three-month period thereafter over the remaining 24 months, subject to continued service on each vesting date. The Chief Executive Officer received 65,952 shares of time-based RSUs with a grant date value of approximately $1.6 million. The Chief Financial Officer received 24,732 shares of time-based RSUs with a grant date value of $600,000. The Chief Scientific Officer received 21,146 shares of time-based RSUs with a grant date value of $513,000. The President and Chief Operating Officer received 25,350 shares of time-based RSUs with a grant date value of $615,000. The 2024 performance-based RSU grants are earned and awarded over a three-year period. The number of RSU awards earned are scaled based on actual performance and will depend on how the Company performs against annual revenue and EBITDA targets for each of fiscal years 2024, 2025, and 2026. The Chief Executive Officer received a total of 98,928 shares of performance-based RSUs, subject to adjustment upward or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2024, 2025, and 2026. The grant date probable value for such performance-based RSUs was approximately $2.4 million and as of the grant date, the value of the maximum potential payout was approximately $3.9 million. The Chief Financial Officer received a total of 37,098 shares of performance-based RSUs, subject to adjustment upward or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2024, 2025, and 2026. The grant date probable value for such performance-based RSUs was approximately $900,000, and as of the grant date, the value of the maximum potential payout was approximately $1.5 million. The Chief Scientific Officer received a total of 31,719 shares of performance-based RSUs, subject to adjustment upward or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2024, 2025, and 2026. The grant date probable value for such performance-based RSUs was approximately $770,000, and as of the grant date, the value of the maximum potential payout was approximately $1.3 million. The President and Chief Operating Officer received a total of 38,026 shares of performance-based RSUs, subject to adjustment upward or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2024, 2025, and 2026. The grant date probable value for such performance-based RSUs was approximately $923,000, and as of the grant date, the value of the maximum potential payout was approximately $1.5 million. The Committee establishes threshold levels of performance and caps the maximum awards. Core Revenue and Core EBITDA are used to determine annual incentive funding and performance-based RSU grants earned, and each metric is weighted equally. Actual Core Revenue must be at least 75% of the allocated target amount and actual Core EBITDA must be at 100% of the allocated target amount for awards to be payable. If actual Core Revenue is at least 75% of plan, then 50% of the executive’s allocated target award is funded. If actual Core Revenue is above the target, then the percentage achievement above target is multiplied by 4. Awards under the schedule are scaled proportionately for Core Revenue for performance between 75% and 100% and between 100% and 125% of plan. The award schedule provides executives with the opportunity to earn incentive awards that are greater than their target awards with actual performance above plan. No matter how extraordinary the performance, the total award is capped at 162.5% of the target of which the maximum funding level for Core Revenue is 100% and for Core EBITDA is 62.5%. The table below summarizes the funding scale for the financial performance metrics.

  11. Executive Compensation Decisions for 2024

    (1) Core Revenue excludes revenue from COVID-19 testing products and services including COVID-19 NGS testing revenue. (2) Core EBITDA is GAAP income (loss) minus non-GAAP gross profit and bad debt recoveries from COVID-19 testing products and services, plus or minus interest (expense) income, plus or minus provisions (benefits) for income taxes, plus goodwill impairment loss, plus restructuring costs, plus acquisition-related costs, plus equity-based compensation expenses, plus depreciation and amortization, plus impairment of available-for-sale debt securities, plus or minus period legal adjustments, and plus or minus other charges or gains, as identified, that management believes are not representative of the Company’s operations. (3) Since the actual Core Revenue exceeded target, the incentive earned for every 1% over target was multiplied by four. (4) Since the actual Core EBITDA exceeded target, the incentive earned for every 1% over target was multiplied by one. For the 2024 fiscal year period, the payout was funded at 112.8% of target incentive awards based on actual Core Revenue and Core EBITDA compared to plan targets. Core Revenue grew 7% over the prior year and was 100.4% of the plan target and Core EBITDA was 124.0% of plan target. The Chief Executive Officer earned an incentive payout of 112.8% of his base salary, and other NEO’s earned an incentive payout of 33.8% of their base salaries. The performance-based RSUs vest and settle after the end of each fiscal year. The performance-based RSUs earned for fiscal year 2024 were equal to 112.8% of the target award. The Chief Executive Officer earned 37,197, 17,820, and 11,280 shares of performance-based RSUs, respectively, under the 2024, 2023, and 2022 incentive plans. The Chief Financial Officer earned 13,949, 5,346, and 3,384 shares of performance-based RSUs, respectively, under the 2024, 2023, and 2022 incentive plans. The Chief Scientific Officer earned 11,926, 4,571 and 3,384 shares of performance-based RSUs, respectively, under the 2024, 2023, and 2022 incentive plans. The President and Chief Operating Officer earned 14,297, 5,480, and 3,384 shares of performance-based RSUs, respectively, under the 2024, 2023, and 2022 incentive plans.

  12. EXECUTIVE OFFICER AND DIRECTOR COMPENSATION

    EXECUTIVE OFFICER AND DIRECTOR COMPENSATION

  13. Summary Compensation Table

    Summary Compensation Table The following table shows the total compensation paid or accrued to our NEOs during the last three fiscal years ended December 31, 2024, 2023, and 2022. Our NEOs consist of (1) our Chief Executive Officer, (2) our Chief Financial Officer, (3) our Chief Scientific Officer and Laboratory Director, and (4) our President and Chief Operating Officer. These individuals were our only executive officers during the fiscal year ended December 31, 2024.

  14. Summary Compensation Table

    | Name and Principal Position | Year | Salary ($) | Non-equity incentive plan compensation ($) | Stock Awards ($)(1) | All Other Compensation ($)(2) | Total ($) | | (a) | (b) | (c) | (d) | (e) | (f) | (g) | | Ming Hsieh | 2024 | 1,000,000 | 1,128,000 | 4,000,000(3) | — | 6,128,000 | | Chief Executive Officer | 2023 | 1,000,000 | 1,309,167 | 3,000,000(4) | — | 5,309,167 | | | 2022 | 947,917 | 713,556 | 3,572,400(5) | — | 5,233,873 | | Paul Kim | 2024 | 600,000 | 203,040 | 1,500,000(6) | 50,604 | 2,353,644 | | Chief Financial Officer | 2023 | 600,000 | 235,650 | 900,000(7) | 43,963 | 1,779,613 | | | 2022 | 579,167 | 128,440 | 3,115,000(8) | 49,980 | 3,872,587 | | Hanlin Gao | 2024 | 513,000 | 173,599 | 1,282,500(9) | 12,879 | 1,981,978 | | Chief Scientific Officer and Laboratory Director | 2023 | 513,000 | 201,481 | 769,500(10) | 6,221 | 1,490,202 | | | 2022 | 510,292 | 109,816 | 3,115,000(8) | 10,500 | 3,745,608 | | Jian Xie | 2024 | 615,000 | 208,116 | 1,537,500(11) | 15,179 | 2,375,795 | | President and Chief Operating Officer | 2023 | 615,000 | 241,541 | 922,500(12) | 12,200 | 1,791,241 | | | 2022 | 611,875 | 131,651 | 3,115,000(8) | 12,200 | 3,870,726 |

  15. Summary Compensation Table

    Summary Compensation Table Footnotes: (1) Calculated in accordance with Financial Accounting Standards Board (“FASB”) Accounting ASC Topic 718 to reflect the grant date fair value for stock awards for fiscal years 2024, 2023, and 2022. Assumptions used in the calculation of these amounts are included in Note 10 to our audited consolidated financial statements included in the Annual Report. (2) Amounts consist of our matching contributions under our 401(k)-retirement savings plan for Dr. Gao and Mr. Xie. For Mr. Kim, the amounts reflect $16,862, $10,138, and $10,500 in matching contributions under our 401(k)-retirement savings plan in 2024, 2023, and 2022, respectively, and $33,742, $33,825, and $39,480 for the rent and other costs paid by us for an apartment located near our corporate headquarters that was used by Mr. Kim in 2024, 2023, and 2022, respectively. (3) Represents RSU awards granted on February 26, 2024 relating to (i) 65,952 shares of time-based RSUs, which vest over a period of three years, with 1/3rd of such shares vesting 12 months after February 26, 2024 and 1/12th of such shares vesting at the end of every three-month period thereafter over the remaining 24 months, subject to continued service for the Company on each vesting date and (ii) 98,928 shares of performance-based RSUs, subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2024, 2025, and 2026. The grant date probable value for such performance-based RSUs was approximately $2.4 million and as of the grant date, the value of the maximum potential payout was approximately $3.9 million. Represents RSU awards granted on February 23, 2023 relating to (i) 47,393 shares of time-based RSUs, which vest over a period of three years, with 1/3rd of such shares vesting 12 months after February 23, 2023 and 1/12th of such shares vesting at the end of every three-month period thereafter over the remaining 24 months, subject to continued service for the Company on each vesting date and (ii) 47,393 shares of performance-based RSUs, subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2023, 2024, and 2025. The grant date probable value for such performance-based RSUs was approximately $1.5 million and as of the grant date, the value of the maximum potential payout was approximately $2.4 million. Represents (i) 30,000 shares of time-based RSUs granted on August 1, 2022, which vest over a period of three years, with 1/3rd of such shares vesting 12 months after August 1, 2022, and 1/12th of such shares vesting at the end of every three-month period thereafter over the remaining 24 months, subject to the officer’s continued service for us on each vesting date, and (ii) 30,000 shares of performance-based RSUs granted on August 1, 2022. The performance-based RSUs are subject to adjustment upward (to a maximum of 150% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2022, 2023, and 2024. The grant date probable value for such performance-based RSUs was approximately $1.8 million, and as of the grant date, the value of the maximum potential payout was approximately $2.7 million. Represents RSU awards granted on February 26, 2024 relating to (i) 24,732 shares of time-based RSUs, which vest over a period of three years, with 1/3rd of such shares vesting 12 months after February 26, 2024 and 1/12th of such shares vesting at the end of every three month period thereafter over the remaining 24 months, subject to continued service for the Company on each vesting date and (ii) 37,098 shares of performance-based RSUs, subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2024, 2025, and 2026. The grant date probable value for such performance-based RSUs was approximately $900,000, and as of the grant date, the value of the maximum potential payout was approximately $1.5 million. (7) Represents RSU awards granted on February 23, 2023 relating to (i) 14,218 shares of time-based RSUs, which vest over a period of three years, with 1/3rd of such shares vesting 12 months after February 23, 2023 and 1/12th of such shares vesting at the end of every three month period thereafter over the remaining 24 months, subject to continued service for the Company on each vesting date and (ii) 14,218 shares of performance-based RSUs, subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2023, 2024, and 2025. The grant date probable value for such performance-based RSUs was approximately $450,000, and as of the grant date, the value of the maximum potential payout was approximately $731,000. (8) Represents RSU awards granted on February 28, 2022 relating to (i) 32,000 shares of one-time special time-based RSUs, which vest over a period of four years, with 1/4th of such shares vesting 12 months after March 1, 2022, and 1/16th of such shares vesting at the end of every three-month period thereafter over the remaining 36 months, subject to the respective officer’s continued service for us on each vesting date, (ii) 9,000 shares of time-based RSUs, which vest over a period of three years, with 1/3rd of such shares vesting 12 months after March 1, 2022, and 1/12th of such shares vesting at the end of every three-month period thereafter over the remaining 24 months, subject to the respective officer’s continued service for us on each vesting date, and (iii) 13,500 shares of performance-based RSUs, subject to adjustment upward (to a maximum of 150% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2022, 2023, and 2024. The grant date probable value for such performance-based RSUs was approximately $561,000, and as of the grant date, the value of the maximum potential payout was approximately $841,000. (9) Represents RSU awards granted on February 26, 2024 relating to (i) 21,146 shares of time-based RSUs, which vest over a period of three years, with 1/3rd of such shares vesting 12 months after February 26, 2024 and 1/12th of such shares vesting at the end of every three month period thereafter over the remaining 24 months, subject to continued service for the Company on each vesting date and (ii) 31,719 shares of performance-based RSUs, subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2024, 2025, and 2026. The grant date probable value for such performance-based RSUs was approximately $770,000, and as of the grant date, the value of the maximum potential payout was approximately $1.3 million. (10)

  16. Summary Compensation Table

    Represents RSU awards granted on February 23, 2023 relating to (i) 12,156 shares of time-based RSUs, which vest over a period of three years, with 1/3rd of such shares vesting 12 months after February 23, 2023 and 1/12th of such shares vesting at the end of every three month period thereafter over the remaining 24 months, subject to continued service for the Company on each vesting date and (ii) 12,156 shares of performance-based RSUs, subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2023, 2024, and 2025. The grant date probable value for such performance-based RSUs was approximately $385,000, and as of the grant date, the value of the maximum potential payout was approximately $626,000. Represents RSU awards granted on February 26, 2024 relating to (i) 25,350 shares of time-based RSUs, which vest over a period of three years, with 1/3rd of such shares vesting 12 months after February 26, 2024 and 1/12th of such shares vesting at the end of every three month period thereafter over the remaining 24 months, subject to continued service for the Company on each vesting date and (ii) 38,026 shares of performance-based RSUs, subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2024, 2025, and 2026. The grant date probable value for such performance-based RSUs was approximately $923,000, and as of the grant date, the value of the maximum potential payout was approximately $1.5 million. Represents RSU awards granted on February 23, 2023 relating to (i) 14,573 shares of time-based RSUs, which vest over a period of three years, with 1/3rd of such shares vesting 12 months after February 23, 2023 and 1/12th of such shares vesting at the end of every three month period thereafter over the remaining 24 months, subject to continued service for the Company on each vesting date and (ii) 14,573 shares of performance-based RSUs, subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2023, 2024, and 2025. The grant date probable value for such performance-based RSUs was approximately $461,000, and as of the grant date, the value of the maximum potential payout was approximately $749,000. Narrative Explanation to the Summary Compensation Table NEOs are eligible to receive annual incentive awards that provide a cash award tied to Company performance. The value of any awards paid with respect to the applicable fiscal year is disclosed in column (d) of the Summary Compensation Table. Refer to the “Compensation Discussion and Analysis” section for a more complete explanation of the plan. The stock awards reported in column (e) of the Summary Compensation Table represent the grant date value of RSUs granted to NEOs during the fiscal year. Refer to the “Compensation Discussion and Analysis” section and above footnotes to the table for a description of these equity grants and the associated vesting conditions. The NEOs are participants in the Fulgent 401(k) Plan. The employer contribution amounts for the fiscal year period for each named executive officer are included in column (f) and reported under footnote number 3 of the Summary Compensation Table. Employer contributions under the 401(k) Plan are structured as a percentage of base salary up to statutory compensation limits and include Safe Harbor contributions, applied on a non-discriminatory basis for all 401(k) Plan participants.

  17. 2024 Fiscal Year Grants of Plan-Based Awards

    2024 Fiscal Year Grants of Plan-Based Awards The following table shows information regarding grants of non-equity incentive plan awards and grants of equity awards that we made during the fiscal year ended December 31, 2024 to each of our executive officers named in the Summary Compensation Table.

  18. 2024 Fiscal Year Grants of Plan-Based Awards

    | Name | Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | Estimated Future Payouts Under Equity Incentive Plan Awards(2) | | | All Other Stock Awards: Number of Shares of Stock or Units | All Other Option Awards: Number of Securities Underlying Options | Exercise or Base Price of Option Awards ($/Sh) | Grant Date Fair Value of Stock and Option Awards | | | | Target ($) | Threshold (#) | Target (#) | Maximum (#) | (#) | (#) | | ($) | | Ming Hsieh | — | 1,000,000 | — | — | — | — | — | — | — | | | 2/26/2024 | — | 74,196 | 98,928 | 160,758 | — | — | — | 2,400,000 | | | 2/26/2024 | — | — | — | — | 65,952 | — | — | 1,600,000 | | Paul Kim | — | 180,000 | — | — | — | — | — | — | — | | | 2/26/2024 | — | 27,824 | 37,098 | 60,284 | — | — | — | 900,000 | | | 2/26/2024 | — | — | — | — | 24,732 | — | — | 600,000 | | Hanlin Gao | — | 153,900 | — | — | — | — | — | — | — | | | 2/26/2024 | — | 23,789 | 31,719 | 51,543 | — | — | — | 769,500 | | | 2/26/2024 | — | — | — | — | 21,146 | — | — | 513,000 | | Jian Xie | — | 184,500 | — | — | — | — | — | — | — | | | 2/26/2024 | — | 28,520 | 38,026 | 61,792 | — | — | — | 922,500 | | | 2/26/2024 | — | — | — | — | 25,350 | — | — | 615,000 |

  19. 2024 Fiscal Year Grants of Plan-Based Awards

    Represents the estimated target payout for 2024 performance under the Annual Incentive Pay Plan. The annual payout can range from 75% to 162.5% of target. The Annual Incentive Pay Plan payout for 2024 was 112.8% of target. Actual payouts are shown in the Summary Compensation Table in the column titled “Non-Equity Incentive Plan Compensation”; Represents the threshold, target, and maximum payouts for the performance-based RSU grants. The annual payout can range from 75% to 162.5% of target. The payout for 2024 was 112.8% of target. Refer to the “Compensation Discussion and Analysis-Executive Compensation Decision for 2024-Equity Awards” for a description of the vesting of performance-based RSU grants made during the fiscal year. Narrative Explanation to the Grants of Plan Based Award Table The grant date for all equity awards is the day the award is approved by Compensation committee, unless otherwise determined by the Compensation committee. Equity grants were delivered in the form of RSUs as provided for under the 2016 Plan. Refer to the “Compensation Discussion and Analysis” section for a description of conditions attached to RSU grants made during the fiscal year. All earned RSUs are paid in the form of Fulgent Genetics, Inc. common shares at the end of the vesting period.

  20. Outstanding Equity Awards at December 31, 2024

    Outstanding Equity Awards at December 31, 2024 The following table sets forth information regarding outstanding equity awards held by our NEOs as of December 31, 2024.

  21. Outstanding Equity Awards at December 31, 2024

    | | Option Awards | | | | | Stock Awards | | | | | Name | Number of securities underlying unexercised options (#) exercisable | Number of securities underlying unexercised options (#) unexercisable | Equity incentive plan awards: Number of securities underlying unexercised unearned options (#) | Option exercise price ($) | Option expiration date | Number of shares or units of stock that have not vested (#) | Market value of shares or units of stock that have not vested ($) | Equity incentive plan awards: Number of unearned shares, units or other rights that have not vested (#) | Equity incentive plan awards: Market or payout value of unearned shares, units or other rights that have not vested ($) | | Ming Hsieh | — | — | — | — | — | 233,722(1) | 4,316,845(5) | — | — | | Paul Kim | — | — | — | — | — | 90,983(2) | 1,680,456(5) | — | — | | Hanlin Gao | — | — | — | — | — | 80,222(3) | 1,481,700(5) | — | — | | Jian Xie | — | — | — | — | — | 92,913(4) | 1,716,097(5) | — | — |

  22. Outstanding Equity Awards at December 31, 2024

    (1) Represents RSU awards relating to (i) 30,000 shares granted on August 1, 2022 (vesting commencement date of August 1, 2022), 47,393 shares granted on February 23, 2023 (vesting commencement date of February 23, 2023), and 65,952 shares granted on February 26, 2024 (vesting commencement date of February 26, 2024), which vest over a period of three years, with 1/3rd of such shares vesting 12 months after vesting commencement date, and 1/12th of such shares vesting at the end of every three-month period thereafter over the remaining 24 months, subject to the officer’s continued service for us on each vesting date; (ii) 30,000 shares of performance-based RSUs granted on August 1, 2022 (vesting commencement date of August 1, 2022). The performance-based RSUs are subject to adjustment upward (to a maximum of 150% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2022, 2023, and 2024; (iii) 47,393 shares of performance-based RSUs granted on February 23, 2023 (vesting commencement date of February 23, 2023). The performance-based RSUs are subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2023, 2024, and 2025; and (iv) 98,928 shares of performance-based RSUs granted on February 26, 2024 (vesting commencement date of February 26, 2024). The performance-based RSUs are subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2024, 2025, and 2026; Represents RSU awards relating to (i) 32,000 shares granted on February 28, 2022 (vesting commencement date of March 1, 2022), which vest over a period of four years, with 1/4th of such shares vesting 12 months after vesting commencement date, and 1/16th of such shares vesting at the end of every three-month period thereafter over the remaining 36 months, subject to the officer’s continued service for us on each vesting date; (ii) 9,000 shares granted on February 28, 2022 (commencement date of March 1, 2022), 14,218 shares granted on February 23, 2023 (vesting commencement date of February 23, 2023), and 24,732 shares granted on February 26, 2024 (vesting commencement date of February 26, 2024), which vest over a period of three years, with 1/3rd of such shares vesting 12 months after vesting commencement date, and 1/12th of such shares vesting at the end of every three-month period thereafter over the remaining 24 months, subject to officer’s continued service for us on each vesting date; (iii) 9,000 shares of performance-based RSUs granted on February 28, 2022. The performance-based RSUs are subject to adjustment upward (to a maximum of 150% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2022, 2023, and 2024; (iv) 14,218 shares of performance-based RSUs granted on February 23, 2023. The performance-based RSUs are subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2023, 2024, and 2025; and (v) 37,098 shares of performance-based RSUs granted on February 26, 2024 (vesting commencement date of February 26, 2024). The performance-based RSUs are subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2024, 2025, and 2026; Represents RSU awards relating to (i) 3,500 shares of our common stock granted on April 30, 2021 (vesting commencement date of April 30, 2021), 32,000 shares granted on February 28, 2022 (vesting commencement date of March 1, 2022), which vest over a period of four years, with 1/4th of such shares vesting 12 months after vesting commencement date, and 1/16th of such shares vesting at the end of every three-month period thereafter over the remaining 36 months, subject to the officer’s continued service for us on each vesting date; (ii) 9,000 shares granted on February 28, 2022 (vesting commencement date of March 1, 2022), 12,156 shares granted on February 23, 2023 (vesting commencement date of February 23, 2023), and 21,146 shares granted on February 26, 2024 (vesting commencement date of February 26, 2024), which vest over a period of three years, with 1/3rd of such shares vesting 12 months after vesting commencement date, and 1/12th of such shares vesting at the end of every three-month period thereafter over the remaining 24 months, subject to officer’s continued service for us on each vesting date; (iii) 9,000 shares of performance-based RSUs granted on February 28, 2022. The performance-based RSUs are subject to adjustment upward (to a maximum of 150% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2022, 2023, and 2024; (iv) 12,156 shares of performance-based RSUs granted on February 23, 2023. The performance-based RSUs are subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2023, 2024, and 2025; and (v) 31,719 shares of performance-based RSUs granted on February 26, 2024 (vesting commencement date of February 26, 2024). The performance-based RSUs are subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2024, 2025, and 2026; (4)

  23. Outstanding Equity Awards at December 31, 2024

    Represents RSU awards relating to (i) 32,000 shares granted on February 28, 2022 (vesting commencement date of March 1, 2022), which vest over a period of four years, with 1/4th of such shares vesting 12 months after vesting commencement date, and 1/16th of such shares vesting at the end of every three-month period thereafter over the remaining 36 months, subject to the officer’s continued service for us on each vesting date; (ii) 9,000 shares granted on February 28, 2022 (vesting commencement date of March 1, 2022), 14,573 shares granted on February 23, 2023 (vesting commencement date of February 23, 2023), and 25,350 shares granted on February 26, 2024 (vesting commencement date of February 26, 2024), which vest over a period of three years, with 1/3rd of such shares vesting 12 months after vesting commencement date, and 1/12th of such shares vesting at the end of every three-month period thereafter over the remaining 24 months, subject to officer’s continued service for us on each vesting date; (iii) 9,000 shares of performance-based RSUs granted on February 28, 2022. The performance-based RSUs are subject to adjustment upward (to a maximum of 150% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2022, 2023, and 2024; (iv) 14,573 shares of performance-based RSUs granted on February 23, 2023. The performance-based RSUs are subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2023, 2024, and 2025; and (v) 38,026 shares of performance-based RSUs granted on February 26, 2024 (vesting commencement date of February 26, 2024). The performance-based RSUs are subject to adjustment upward (to a maximum of 162.5% of the target award) or downward, depending upon the achievement of certain performance conditions for each of the three fiscal years ending on December 31, 2024, 2025, and 2026; (5) The market value was determined by multiplying the unvested shares of common stock subject to the stock award by $18.47, the closing price of our common stock on December 31, 2024.

  24. Option Exercises and Stock Vested in 2024

    Option Exercises and Stock Vested in 2024 The following table shows information regarding exercises of options to purchase our common stock and vesting of stock awards held by each of our NEOs during the fiscal year ended December 31, 2024.

  25. Option Exercises and Stock Vested in 2024

    | Name | Option Awards | | Stock Awards | | | | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($) | | (a) | (b) | (c) | (d) | (e) | | Ming Hsieh | — | — | 71,415 | 1,674,565 | | Paul Kim | — | — | 36,924 | 845,291 | | Hanlin Gao | — | — | 28,197 | 637,716 | | Jian Xie | — | — | 67,287 | 1,565,879 |

  26. Pension Benefits

    Pension Benefits We do not have any qualified or non-qualified defined benefit plans.

  27. Chief Executive Officer Pay Ratio

    Chief Executive Officer Pay Ratio The following is a reasonable estimate prepared under the SEC rules of the ratio of the annual total compensation of our Chief Executive Officer to the median of the annual total compensation of our other employees. For the 2024 fiscal year: • The estimated median of the annual total compensation of all employees, excluding the Chief Executive Officer, was $66,428; • The annual total compensation of the Chief Executive Officer, as reported in the Summary Compensation Table, was $6,128,000; and • The ratio of the annual total compensation of the Chief Executive Officer to the median of the annual total compensation of all other employees was estimated to be 92 to 1. In determining the pay ratio information provided above, we first identified “median employee” for the 2024 fiscal year by using the following methodology, as permitted by the SEC’s pay ratio disclosure rules: • We selected December 31, 2024 as the date upon which we would identify employee population and median employee and, from tax and payroll records, we compiled a list of 1,540 total full-time and part-time employees who were employed during the year ended December 31, 2024. • We used total cash compensation during the 2024 fiscal year as a consistently applied compensation measure to identify the median employee from the employees on the list. For this purpose, we define total cash compensation as W-2 Box 1 wages. We also annualized the total cash compensation paid to those employees that were not employed for the full year. This pay ratio is a reasonable estimate calculated in a manner consistent with SEC rules based on our payroll and employment records and the methodologies prescribed by the SEC. The SEC rules for identifying the median compensated employee and calculating the pay ratio based on that employee’s total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their compensation practices. Due to the flexibility afforded by the rules of the SEC in calculating the pay ratio amount, the ratio calculated may not be comparable to the Chief Executive Officer pay ratio presented by other companies.

  28. Director Compensation

    Director Compensation The following table shows the total compensation paid or accrued during the fiscal year ended December 31, 2024 to each of our non-employee directors. Directors who are employed by us are not compensated for their service on our Board of Directors.

  29. Director Compensation

    | Name(1) | Fees Earned or Paid in Cash ($) | Stock Awards(2) ($) | Option Awards(3) ($) | Non-Equity Incentive Plan Compensation ($) | Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) | All Other Compensation ($) | Total ($) | | Linda Marsh(4)(5) | 90,500 | 180,000 | — | — | — | — | 270,500 | | Michael Nohaile, Ph.D. (4)(6) | 88,500 | 180,000 | — | — | — | — | 268,500 | | Regina Groves (4)(7) | 93,000 | 90,000 | 90,004 | — | — | — | 273,004 |

  30. Director Compensation

    (1) Ming Hsieh, Chairperson of our Board and Chief Executive Officer, is not included in this table because he is an employee of our Company and thus receives no additional compensation for his services as a director. The compensation received by Mr. Hsieh as an employee of our Company is described under “Executive Officer Compensation” above. (2) These amounts represent the aggregate grant date fair value of stock awards granted to each director in 2024 computed in accordance with FASB ASC Topic 718. A discussion of the assumptions used in determining grant date fair value may be found in Note 10 to our Financial Statements, included in our Annual Report. (3) These amounts represent the aggregate grant date fair value of options granted to each director in 2024 computed in accordance with FASB ASC Topic 718. A discussion of the assumptions used in determining grant date fair value may be found in Note 10 to our Financial Statements, included in our Annual Report. (4) The following table represents grant date fair value and unvested awards for the awards granted in 2024 on a grant-by-grant basis:

  31. Director Compensation

    | Name | Grant Date | Grant Date Fair Value ($/Share) | Number of Stock Options Held at Fiscal Year-End | Number of Shares of Restricted Stock Held at Fiscal Year-End | | Linda Marsh | 5/16/2024 | 22.50 | — | 8,000 | | Michael Nohaile, Ph.D. | 5/16/2024 | 22.50 | — | 8,000 | | Regina Groves | 5/16/2024 | 22.50 | — | 4,000 | | Regina Groves | 5/16/2024 | 16.42 | 5,481 | — |

  32. Director Compensation

    (5) As of December 31, 2024, Ms. Marsh held the following outstanding equity awards: (i) a stock option award granted on August 1, 2019 to purchase 20,000 shares of our common stock at an exercise price of $7.56; (ii) a stock option award granted on May 27, 2020 to purchase 5,000 shares of our common stock at an exercise price of $15.82; (iii) a RSU award granted on May 20, 2021 representing the right to receive 2,000 shares of our common stock; (iv) a RSU award granted on May 18, 2022 representing the right to receive 2,000 shares of our common stock; (v) a RSU award granted on August 1, 2022 representing the right to receive 1,600 shares of our common stock; (vi) a RSU award granted on May 18, 2023 representing the right to receive 5,059 shares of our common stock; and (vii) a RSU award granted on May 16, 2024 representing the right to receive 8,000 shares of our common stock. All such equity awards vest pursuant to the vesting schedule for director equity awards set forth in our non-employee director compensation program. (6) As of December 31, 2024, Dr. Nohaile held the following outstanding equity awards: (i) a stock option award granted on August 1, 2022 to purchase 10,000 shares of our common stock at an exercise price of $59.54; (ii) a RSU award granted on August 1, 2022 representing the right to receive 4,000 shares of our common stock; (iii) a stock option award granted on May 18, 2023 to purchase 3,380 shares of our common stock at an exercise price of $35.58; (iv) a RSU award granted on May 18, 2023 representing the right to receive 2,529 shares of our common stock; and (v) a RSU award granted on May 16, 2024 representing the right to receive 8,000 shares of our common stock. All such equity awards vest pursuant to the vesting schedule for director equity awards set forth in our non-employee director compensation program. As of December 31, 2024, Regina Groves held the following outstanding equity awards: (i) a stock option award granted on January 3, 2023 to purchase 10,000 shares of our common stock at an exercise price of $30.66; (ii) a RSU award granted on January 3, 2023 representing the right to receive 4,000 shares of our common stock; (iii) a stock option award granted on May 18, 2023 to purchase 6,759 shares of our common stock at an exercise price of $35.58; (iv) a stock option award granted on May 16, 2024 to purchase 5,481 shares of our common stock at an exercise price of $22.50; and (v) a RSU award granted on May 16, 2024 representing the right to receive 4,000 shares of our common stock. All such equity awards vest pursuant to the vesting schedule for director equity awards set forth in our non-employee director compensation program. The following is a description of the standard compensation arrangements under which our directors are compensated for their service as directors, including as members of the various committees of our board.

  33. Non-Employee Director Compensation Program

    Non-Employee Director Compensation Program Our Board has established a compensation program for our directors who are not employees of our Company, which consists of cash and equity compensation as set forth below. Mr. Hsieh, who serves as our Chief Executive Officer and Chairperson of our Board, does not receive any additional compensation for his service as a director. We expect to continue to evaluate our compensation policies with respect to our non-employee directors.

  34. PAY VERSUS PERFORMANCE

    PAY VERSUS PERFORMANCE The following table shows the relationship between executive compensation actually paid to our Principal Executive Officer (“PEO”) and other NEOs, including our Chief Financial Officer, Chief Scientific Officer and Laboratory Director, and President and Chief Operating Officer (“Non-PEO NEOs”), and certain financial performance of the Company during the last five fiscal years ended December 31, 2024, 2023, 2022, 2021 and 2020.

  35. PAY VERSUS PERFORMANCE

    | Year | Summary Compensation Table Total for PEO | Compensation Actually Paid to PEO | Average Summary Compensation Table Total for Non-PEO NEOs | Average Compensation Actually Paid to Non-PEO NEOs | Value of Initial Fixed $100 Investment Based On: | | Net Income | Total Revenue | | | | | | | Total Share-holder Return | Peer Group Total Share-holder Return | | | | | ($) | ($) | ($) | ($) | ($) | ($) | ($ Millions) | ($ Millions) | | (a) | (b) (1) | (c) (2) | (d) (3) | (e) (4) | (f) (5) | (g) (6) | (h) (7) | (i) (8) | | 2024 | 6,128,000 | 4,064,580 | 2,237,139 | 1,334,343 | 35 | 91 | (42.7) | 283.5 | | 2023 | 5,309,167 | 5,035,476 | 1,687,019 | 1,715,482 | 191 | 115 | (167.8) | 289.2 | | 2022 | 5,233,873 | 3,448,273 | 3,829,640 | (2,733,189) | 231 | 111 | 143.4 | 619.0 | | 2021 | 5,664,303 | 5,664,303 | 758,236 | 6,545,715 | 780 | 125 | 507.4 | 992.6 | | 2020 | 248,000 | 248,000 | 2,507,503 | 6,407,036 | 404 | 126 | 214.3 | 421.7 |

  36. PAY VERSUS PERFORMANCE

    Footnotes: (1) The dollar amounts reported in column (b) are the amounts of total compensation reported for Ming Hsieh, Chief Executive Officer (our PEO), for each corresponding year in the “Total” column of the Summary Compensation Table. (2) The dollar amounts reported in column (c) represent the amount of compensation actually paid (“CAP”) to Ming Hsieh, as computed in accordance with SEC rules. The dollar amounts do not reflect the actual amount of compensation earned by or paid to Ming Hsieh during the applicable year. In accordance with SEC rules, the following adjustments were made to Ming Hsieh’s total compensation for each year to determine CAP:

  37. PAY VERSUS PERFORMANCE

    | Footnote (2) - Table 1 | | | | | | Year | Reported Summary Compensation Table Total for PEO | Reported Value of Equity Awards | Equity Award Adjustments | Compensation Actually Paid to PEO | | | ($) | ($) | ($) | ($) | | (a) | (b) | (c) (i) | (d) (ii) | (e) | | 2024 | 6,128,000 | 4,000,000 | 1,936,580 | 4,064,580 | | 2023 | 5,309,167 | 3,000,000 | 2,726,309 | 5,035,476 | | 2022 | 5,233,873 | 3,572,400 | 1,786,800 | 3,448,273 | | 2021 | 5,664,303 | — | — | 5,664,303 | | 2020 | 248,000 | — | — | 248,000 |

  38. PAY VERSUS PERFORMANCE

    i. The grant date fair value of equity awards in column (c) of Footnote (2) - Table 1 represents the total of the amounts reported in the “Stock Awards” column in the Summary Compensation Table for the applicable year. ii. The equity award adjustments in column (d) of Footnote (2) - Table 1 include the addition (or subtraction, as applicable) of the following: (1) the year-end fair value of any equity awards granted in the applicable year that are outstanding and unvested as of the end of the year; (2) the amount of change as of the end of the applicable year (from the end of the prior fiscal year) in fair value of any awards granted in prior years that are outstanding and unvested as of the end of the applicable year; (3) for awards granted in prior years that vest in the applicable year, the amount equal to the change as of the vesting date (from the end of the prior fiscal year) in fair value. The valuation assumptions used to calculate fair values did not materially differ from those disclosed at the time of grant. The amounts deducted or added in calculating the equity award adjustments are as follows:

  39. PAY VERSUS PERFORMANCE

    | Footnote (2) - Table 2 | | | | | | | | | Year | Year End Fair Value of Equity Awards Granted During the Year that Remained Unvested | Year over Year Change in Fair Value of Equity Awards Granted in Prior Years that Remained Unvested | Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Year | Year over Year Change in Fair Value of Equity Awards Granted in Prior Years that Vested in the Year | Fair Value at the End of the Prior Year of Equity Awards that Failed to Meet Vesting Conditions in the Year | Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation | Total Equity Award Adjustments | | | ($) | ($) | ($) | ($) | ($) | ($) | ($) | | (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | | 2024 | 3,045,334 | (718,710) | — | (390,043) | — | — | 1,936,580 | | 2023 | 2,740,263 | (32,625) | — | 89,667 | (70,996) | — | 2,726,309 | | 2022 | 1,786,800 | — | — | — | — | — | 1,786,800 | | 2021 | — | — | — | — | — | — | — | | 2020 | — | — | — | — | — | — | — |

  40. PAY VERSUS PERFORMANCE

    The dollar amounts reported in column (d) represent the average of the amounts reported for the Company’s NEOs as a group (excluding the Company’s PEO) in the “Total” column of the Summary Compensation Table in each applicable year. The names of each of the NEOs (excluding the Company’s PEO) included for purposes of calculating the average amounts in each applicable year are as follows: Paul Kim, Chief Financial Officer, Hanlin Gao, Chief Scientific Officer and Laboratory Director, and Jian Xie, President and Chief Operating Officer, for 2020, 2021, 2022, 2023, and 2024. (4) The dollar amounts reported in column (e) represent the average amount of CAP to the NEOs as a group (excluding the Company’s PEO), as computed in accordance with SEC rules. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the NEOs as a group (excluding the Company’s PEO) during the applicable year. In accordance with the SEC rules, the following adjustments were made to average total compensation for the NEOs as a group (excluding the Company’s PEO) for each year to determine the CAP, using the same methodology described above in Footnote 2:

  41. PAY VERSUS PERFORMANCE

    | Footnote (4) - Table 1 | | | | | | Year | Average Reported Summary Compensation Table Total for Non-PEO NEOs | Average Reported Value of Equity Awards | Average Equity Award Adjustments | Average Compensation Actually Paid to Non-PEO NEOs | | | ($) | ($) | ($) | ($) | | (a) | (b) | (c) | (d) (i) | (e) | | 2024 | 2,237,139 | 1,440,000 | 537,204 | 1,334,343 | | 2023 | 1,687,019 | 864,000 | 892,463 | 1,715,482 | | 2022 | 3,829,640 | 3,115,000 | (3,447,829) | (2,733,189) | | 2021 | 758,236 | 89,857 | 5,877,336 | 6,545,715 | | 2020 | 2,507,503 | 2,273,600 | 6,173,133 | 6,407,036 |

  42. PAY VERSUS PERFORMANCE

    i. The amounts deducted or added in calculating the total average equity award adjustments are as follows:

  43. PAY VERSUS PERFORMANCE

    | Footnote (4) - Table 2 | | | | | | | | | Year | Average Year End Fair Value of Equity Awards Granted During the Year that Remained Unvested | Year over Year Average Change in Fair Value of Equity Awards Granted in Prior Years that Remained Unvested | Average Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Year | Year over Year Average Change in Fair Value of Equity Awards Granted in Prior Years that Vested in the Year | Average Fair Value at the End of the Prior Year of Equity Awards that Failed to Meet Vesting Conditions in the Year | Average Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation | Total Average Equity Award Adjustments | | | ($) | ($) | ($) | ($) | ($) | ($) | ($) | | (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | | 2024 | 1,096,324 | (299,444) | — | (259,676) | — | — | 537,204 | | 2023 | 789,185 | (37,573) | — | 166,402 | (25,551) | — | 892,463 | | 2022 | 1,489,000 | (3,304,514) | — | (1,632,315) | — | — | (3,447,829) | | 2021 | 117,355 | 3,904,479 | — | 1,855,502 | — | — | 5,877,336 | | 2020 | 4,168,000 | 1,572,103 | — | 433,030 | — | — | 6,173,133 |

  44. PAY VERSUS PERFORMANCE

    The cumulative total stockholder return (“TSR”) amounts reported in column (f) are calculated in the same manner as required under Item 201(e) of Regulation S-K, measuring the total stockholder return from the market close on the last trading day before the earliest fiscal year in the table, or December 31, 2019, through to and including the end of the fiscal year for which total stockholder return is calculated, or December 31, 2024. (6) The weighted peer group TSR amounts reported in column (g) reflect the Company’s peer group (NASDAQ Biotechnology Index) as reflected in our Annual Report pursuant to Item 201(e) of Regulation S-K for the fiscal year ended December 31, 2024. Each year reflects what the cumulative value of $100 would be, including the reinvestment of dividends, if such amount were invested as of market close on December 31, 2019. (7) The dollar amounts reported in column (h) are the Company’s net income amounts reflected in the Company’s audited financial statements for the applicable year. (8) While the Company uses numerous financial and non-financial performance measures for the purpose of evaluating performance for the Company’s compensation programs, the Company has determined that revenue is the financial performance measure that, in the Company’s assessment, represents the most important performance measure (that is not otherwise required to be disclosed in the Pay Versus Performance Table) used by the company to link compensation actually paid to the Company’s NEOs, for the most recently completed fiscal year, to company performance. The dollar amounts reported in column (i) are the Company’s revenue amounts reflected in the Company’s audited financial statements for the applicable year.

  45. Analysis of Information Presented in the Pay Versus Performance Table

    Analysis of Information Presented in the Pay Versus Performance Table The goal of our executive compensation philosophy is to deliver competitive levels of total compensation that attract and retain top leadership talent, with primary emphasis on pay for performance. Annual incentive awards and performance-based RSU awards are earned based on the achievement of revenue and EBITDA targets. Time-based RSU awards vest over three-to-four-year periods, and the value of the award is tied to the stock price at the time of vesting, which creates an incentive to grow stockholder value. We use variable compensation and equity awards as major components of total compensation. The following graph compares our cumulative TSR over the five most recently completed fiscal years to that of the NASDAQ Biotechnology Index (“Index”) over the same period. The following charts set forth the relationship between CAP paid to our PEO and the average CAP paid to our Non-PEOs and our total revenue and Core Revenue. The following charts set forth the relationship between CAP paid to our PEO, the average CAP paid to our Non-PEOs and our TSR.

  46. PROPOSAL NO. 1 ELECTION OF DIRECTORS

    PROPOSAL NO. 1 ELECTION OF DIRECTORS Our Board of Directors, upon recommendation of our Nominating committee, nominated Ming Hsieh, Linda Marsh, Michael Nohaile, Ph.D., and Regina Groves for election at the Annual Meeting. If they are elected, they will serve on our Board of Directors until the 2026 Annual Meeting or until their respective successors have been elected and qualified. Each of the nominees is currently a director of our Company and were each re-elected by our stockholders at our 2024 Annual Meeting of Stockholders. Upon his or her re-election at the Annual Meeting, each director will serve a one‑year term until the next annual meeting of our stockholders and until his or her successor is duly elected and qualified or until his or her earlier resignation or removal. During the course of a term, the Board may appoint a new director to fill any vacant seat. In that event, the newly appointed director would complete the term of the director he or she replaced or, if appointed to fill a vacancy caused by an increase to the size of the Board, serve until the next annual meeting of our stockholders. Each person nominated for election at the Annual Meeting has agreed to serve if elected, and we have no reason to believe any nominee will be unable to serve. However, if any nominee cannot serve, then your proxy will be voted for another nominee proposed by the Board or, if no nominee is proposed by the Board, a vacancy will occur. We encourage, but do not require, our directors to attend meetings of our stockholders. All of our directors attended our 2024 Annual Meeting of Stockholders. Our directors are encouraged to attend the Annual Meeting. A plurality of the shares voted for each nominee at the Annual Meeting is required to elect each nominee as a director. Our board of directors Recommends The Election Of MING HSIEH, LINDA MARSH, MICHAEL NOHAILE, PH.D., AND REGINA GROVES As Directors, And Proxies Solicited By Our board of directors Will Be Voted In Favor Thereof Unless A Stockholder Has Indicated Otherwise On The Proxy.