DEF 14A of On Semiconductor Corp
Filed Apr 2, 2026 · FY20250001097864-26-000010
Director Nominees Overview
Director Nominees Overview
Director Nominees Overview
| | | | | | Committee Memberships* | | | | Name and Principal Occupation | | Age | Director Since | Independent | Audit Committee | Governance and Sustainability Committee | Human Capital and Compensation Committee | | | Susan K. Carter Former Senior Vice President and Chief Financial Officer, Ingersoll Rand plc (now known as Trane Technologies plc) | 67 | 2020 | ü | µ | l | | | | Thomas L. Deitrich President, Chief Executive Officer and Director, Itron, Inc. | 59 | 2020 | ü | | l | l | | | Hassane El-Khoury President, Chief Executive Officer and Director, ON Semiconductor Corporation | 46 | 2020 | | | | | | | Bruce E. Kiddoo Former Chief Financial Officer, Maxim Integrated Products, Inc. | 65 | 2020 | ü | l | | | | | Paul A. Mascarenas Former Chief Technical Officer and Vice President of Research & Advanced Engineering, Ford Motor Company | 64 | 2014 | ü | | µ | l | | | Gregory L. Waters Former President, Chief Executive Officer and Director, Integrated Device Technology, Inc. | 65 | 2020 | ü | l | | l | | | Christine Y. Yan Former President of Asia, Stanley Black & Decker, Inc. | 60 | 2018 | ü | | | µ |
Director Nominees Overview
l Member µ Committee Chair * Our Chair of the Board, Alan Campbell, who is retiring immediately prior to the annual meeting, currently serves as a member of our Audit Committee and our Governance and Sustainability Committee. For committee membership and leadership assignments approved to take effect immediately following the annual meeting, please see page 14.
Director Nominees Overview
| PROPOSAL NO. 2: | | Our Board recommends a vote FOR say-on-pay. | | Advisory Vote to Approve the Compensation of Our Named Executive Officers (Say-on-Pay) | ü | | | (page 24) | | |
Director Nominees Overview
Our Board recommends that stockholders vote to approve, on a non-binding, advisory basis, the compensation of our named executive officers as disclosed in this proxy statement.
Director Nominees Overview
| PROPOSAL NO. 3: | | Our Board recommends a vote FOR ratification of PwC as our auditor for 2026. | | Ratification of Selection of Independent Registered Public Accounting Firm | ü | | | (page 52) | | |
Director Nominees Overview
The Audit Committee appointed PricewaterhouseCoopers LLP to serve as our independent registered public accounting firm for 2026. The Audit Committee and the Board believe that the continued retention of PwC as our independent registered public accounting firm is in the best interests of onsemi and our stockholders.
Director Nominees Overview
| PROPOSAL NO. 4: | Our Board makes NO RECOMMENDATION regarding the stockholder proposal. | | Stockholder Proposal | | | (page 58) | |
Director Nominees Overview
We received a stockholder proposal requesting that the Board take steps to provide for simple majority voting on all matters submitted to stockholders for a vote. The Board has determined not to make a voting recommendation with respect to this stockholder proposal.
THE BOARD OF DIRECTORS AND CORPORATE GOVERNANCE
THE BOARD OF DIRECTORS AND CORPORATE GOVERNANCE
Proposal No. 1: Election of Directors
Proposal No. 1: Election of Directors Our Board recommends a vote “FOR” each of the seven director nominees named below. Our directors are elected annually as provided in our bylaws. Once elected, directors hold office until their terms expire at the next annual meeting of stockholders and their successors are elected (or, if earlier, upon the director’s death, resignation or removal). The Board regularly assesses its size and composition and the skill sets of each director to ensure an appropriate range of diverse perspectives, viewpoints, backgrounds and skills in light of our current and future business objectives and the evolving nature of our product offerings and technology in the highly competitive semiconductor industry. Our Board currently consists of eight directors, each of whom was elected at our 2025 annual meeting of stockholders with the term of each director expiring at the annual meeting. On November 4, 2025, Alan Campbell provided notice to us of his intent to retire from the Board and its committees effective at the end of his current term, which expires immediately prior to the annual meeting. Considering Mr. Campbell’s retirement from the Board and the cohesion and diverse mix of viewpoints among the current Board members, our Board, upon recommendation of the GS Committee, has decided to decrease the size of the Board from eight directors to seven directors, effective as of the annual meeting, renominating each of the other current directors — Messrs. Deitrich, El-Khoury, Kiddoo, Mascarenas and Waters, Ms. Carter and Ms. Yan — for election to a new term. If elected, each of these seven director nominees will serve a term beginning at the annual meeting and expiring at our 2027 annual meeting of stockholders and until the election of his or her successor. Each nominee has consented to being named as a nominee in this proxy statement and to serve as a director if elected. The designated proxies intend to vote your proxy for the election of each such nominee, unless otherwise directed. If, contrary to our expectations, any nominee is unable to serve or for good cause will not serve, your proxy will be voted for a substitute nominee designated by the Board, or the Board may choose to reduce its size.
Our Director Nominees
Our Director Nominees
Information about our Director Nominees
Information about our Director Nominees Set forth below is biographical information about each director nominee, which is intended to highlight each nominee’s particular strengths. An individual director nominee may have other skills, experiences and qualifications not highlighted. Our Board believes that it is important that the following skills, experience and qualifications are represented on our Board because of their particular relevance to our business. In addition to the specific qualifications described below, we believe that each director nominee has the business acumen and sound judgment required for the proper functioning of our Board and the integrity, honesty and adherence to high ethical standards necessary to set the “tone at the top.” Most of our directors also have significant experience on other public company boards, which we believe broadens their knowledge of board processes, issues and solutions.
Information about our Director Nominees
| Key to Relevant Skills and Qualifications | Semiconductor /Technology | | Public Company Management | | International | | | | Manufacturing | | Finance | | Compliance | | | | Enterprise Risk Management (ERM) | | Mergers and Acquisitions | | Government Relations | | | | Environmental, Social and Governance (ESG) | | Sustainability/Climate | | Information Security | | | | AI | | Marketing | | | |
Information about our Director Nominees
| SUSAN K. CARTER | | | | | | | | | | | | | | | Age 67 Director since 2020 Other Public Company Boards: •Amcor plc •Stanley Black & Decker, Inc. | Career Highlights | | | | | | | | | | | | | | | ■ Ingersoll Rand plc (now known as Trane Technologies plc), 2013 – 2020 — Senior Vice President and Chief Financial Officer ■ KBR, Inc., 2009 – 2013 — Executive Vice President and Chief Financial Officer ■ Lennox International, Inc., 2004 – 2009 — Executive Vice President and Chief Financial Officer Other Board Experience ■ Pursuit Aerospace ■ Air Products and Chemicals, Inc., 2011 – 2021 | | | | | | | | | | | | | | | Relevant Skills and Qualifications | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ■ Experience as chief financial officer of a publicly held industrial company ■ Significant management experience and relevant knowledge of financial statement preparation and regulatory compliance ■ Significant experience in manufacturing, automotive, aerospace, defense and engineering and construction industries ■ Extensive experience in accounting and financial reporting, international business, mergers and acquisitions, investor relations, information technology, finance and capital management, government relations and ESG matters | | | | | | | | | | | | | | THOMAS L. DEITRICH | | | | | | | | | | | | | | | Age 59 Director since 2020 Other Public Company Boards: •Itron, Inc. | Career Highlights | | | | | | | | | | | | | | | ■ Itron, Inc. (an energy and water resource management technology company), 2015 – Present — President, Chief Executive Officer and Director, 2019 – Present — Chief Operating Officer, 2015 – 2019 ■ Freescale Semiconductor, Inc. (acquired by NXP Semiconductors N.V.), 2006 – 2015 — Senior Vice President and General Manager Other Board Experience ■ National Electrical Manufacturers Association ■ Ferric, Inc., 2016 – 2020 | | | | | | | | | | | | | | | Relevant Skills and Qualifications | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ■ Experience as chief executive officer of a publicly held technology company ■ Extensive experience in product management, research and development, supply chain management, business development and sales ■Significant management experience and relevant knowledge in semiconductor and industrial markets served ■Significant mergers and acquisitions and global experience | | | | | | | | | | | | |
Information about our Director Nominees
| HASSANE EL-KHOURY | | | | | | | | | | | | | | | | Age 46 Director since 2020 | Career Highlights | | | | | | | | | | | | | | | | ■ ON Semiconductor Corporation, December 2020 – Present — President, Chief Executive Officer and Director ■ Cypress Semiconductor Corporation (acquired by Infineon Technologies AG), 2007 – 2020 — President, Chief Executive Officer and Director, 2016 – 2020 — Executive Vice President, Programmable Systems Division, 2012 – 2016 — Senior Director of Automotive Business Unit, 2010 – 2012 — Senior Business Development Manager, 2008 – 2010 — Staff Application Engineer, 2007 – 2008 Other Board Experience ■ Leia Inc. ■ Sakuú Corporation, 2020 – 2023 | | | | | | | | | | | | | | | | Relevant Skills and Qualifications | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ■ Experience as chief executive officer of a publicly held semiconductor company ■ Extensive experience in the semiconductor and automotive industries ■Significant management and product development experience ■Significant mergers and acquisitions and global experience | | | | | | | | | | | | | |
Information about our Director Nominees
| BRUCE E. KIDDOO | | | | | | | | | | | Age 65 Director since 2020 Other Public Company Boards: •Western Digital Corporation | Career Highlights | | | | | | | | | | | ■ Maxim Integrated Products, Inc., 2007 – 2019 — Chief Financial Officer ■ Broadcom Corporation, 1999 – 2007 — Vice President and Acting Chief Financial Officer, 2006 – 2007 — Vice President, Finance and Corporate Controller — Controller, Broadband Communications Other Board Experience ■ San Onofre Parks Foundation | | | | | | | | | | | Relevant Skills and Qualifications | | | | | | | | | | | | | | | | | | | | | | ■ ■ Extensive experience in the semiconductor industry and with mergers and acquisitions ■ ■ Experience as chief financial officer of a publicly held semiconductor company ■ Significant management experience and relevant knowledge of financial statement preparation and regulatory compliance | | | | | | | | |
Information about our Director Nominees
| PAUL A. MASCARENAS | | | | | | | | | | | | | | Age 64 Director since 2014 Other Public Company Boards: •Aebi Schmidt Group •Neo Performance Materials Inc. | Career Highlights | | | | | | | | | | | | | | ■ Ford Motor Company, 1982 – 2014 — Vice President of Research & Advanced Engineering and Chief Technical Officer, 2011 – 2014 — Vice President of Engineering, 2007 – 2011 — Vice President, North American Vehicle Programs, 2005 – 2007 — Various positions in product development, program management and business leadership, 1982 – 2005 Other Board Experience ■ The Shyft Group (merged with Aebi Schmidt Group), 2018 – 2025 ■ United States Steel Corporation (acquired by Nippon Steel Corporation), 2016 – 2025 ■ BorgWarner, Inc., 2018 – 2022 ■ FISITA – The International Federation of Automotive Engineering Societies, 2012 – 2021 ■ British-American Business Council, Michigan Chapter, 2015 – 2021 ■ Society of Automotive Engineers International, 2018 – 2021 ■ Mentor Graphics, 2015 – 2017 | | | | | | | | | | | | | | Relevant Skills and Qualifications | | | | | | | | | | | | | | | | | | | | | | | | | | | | ■ Extensive experience in technical strategy, planning and research and development ■ Leadership and strategic planning expertise in automotive industry ■ Significant corporate governance experience | | | | | | | | | | | | | GREGORY L. WATERS | | | | | | | | | | | | | | Age 65 Director since 2020 | Career Highlights | | | | | | | | | | | | | | ■ MatrixSpace, Inc. (an AI software company), 2019 – Present — Founder ■ Integrated Device Technology, Inc. (acquired by Renesas Electronics Corporation), 2014 – 2019 — President, Chief Executive Officer and Director ■ Skyworks Solutions, Inc., 2003 – 2012 — Executive Vice President Other Board Experience ■ Cyxtera Technologies, Inc. (acquired by Brookfield Infrastructure Partners L.P.), 2021 – 2024 ■ Mythic Inc., 2020 – 2023 ■ Sierra Wireless, Inc. (acquired by Semtech Corporation), 2020 – 2023 ■ Mellanox Technologies Ltd. (acquired by NVIDIA Corporation), 2018 – 2020 ■ Sand 9 Inc. (acquired by Analog Devices Inc.), 2011 – 2014 | | | | | | | | | | | | | | Relevant Skills and Qualifications | | | | | | | | | | | | | | | | | | | | | | | | | | | | ■ Extensive experience with device technology companies ■ Experience as chief executive officer of a publicly held technology company ■ Significant management experience and relevant knowledge of financial statement preparation and regulatory compliance | | | | | | | | | | | |
Information about our Director Nominees
| CHRISTINE Y. YAN | | | | | | | | | | | | Career Highlights | | | | | | | | | | | ■ Stanley Black & Decker, Inc., 1989 – 2018 — Vice President, Integration, January 2018 – November 2018 — President, Asia, 2014 – January 2018 — President, Stanley Storage and Workspace Systems, 2013 – 2014 — President, Americas, Stanley Engineered Fastening, 2008 – 2013 — President, Global Automotive, Stanley Engineered Fastening, 2006 – 2008 — Various roles in sales and marketing, engineering and research and development, 1989 – 2006 | | | | | | | | | | | Relevant Skills and Qualifications | | | | | | | | | | | | | | | | | | | | | | ■ Extensive commercial, technology and operations management experience, including as member of senior management team of a Fortune 500 company ■ Deep experience running global businesses, especially emerging markets ■ Significant mergers and acquisitions experience ■ Extensive management experience in the automotive, industrial and consumer markets ■ Experience in corporate governance for both public and private companies | | | | | | | | | | Age 60 | | | | | | | | | | | Director since 2018 Other Public Company Boards: •Ansell Limited •Cabot Corporation •Modine Manufacturing Company | | | | | | | | | |
Information about our Director Nominees
Additional information regarding our Board, its committees, director compensation and our corporate governance practices may be found immediately following this Proposal.
Our Seven Director Nominees at a Glance
Our Seven Director Nominees at a Glance
Our Seven Director Nominees at a Glance
| Age Distribution | Gender | Tenure Distribution | | | | | | | | |
Our Seven Director Nominees at a Glance
Our director nominees as a group have a balance of tenure (average tenure of approximately 7.1 years) and age (average age of 61 years) that we believe provides our Board with an effective mix of experience and fresh perspectives. All director nominees are below our mandatory retirement age of 75. We have one director nominee who is Asian and two female nominees. The Board will continue to evaluate from time to time the composition of the Board, including any director candidate who may complement the knowledge, skills and experience possessed by our director nominees, to ensure that the composition of the Board appropriately reflects changes in our evolving business.
Director Nominee Qualifications
Director Nominee Qualifications The GS Committee is required to develop and periodically review criteria for nominees for director. When the GS Committee considers diversity, as it did in connection with the Board’s 2025 self-evaluation process, it considers diversity of perspectives, backgrounds and skills, as it deems appropriate. Among other matters, the GS Committee may consider the following nomination criteria regarding Board membership: •the appropriate size of the Board; •a nominee’s knowledge, skills and experience, including, without limitation, experience in finance and accounting, general business management, the semiconductor industry and semiconductor technology, international business, cybersecurity, AI, sales and marketing, corporate governance and compliance and intellectual property; •the needs of the Company with respect to particular skills and experience; •a nominee’s experience leading and supporting sustainability initiatives and civic responsibility; •a nominee’s independence as defined in Nasdaq and SEC rules and regulations; •a nominee’s age and tenure; and •the desire to balance the benefit of continuity with the periodic injection of fresh perspectives provided by new Board members. The Board’s goal is to assemble a complementary slate of directors who bring together a variety of perspectives and skills derived from high-quality business and professional and personal experiences. Directors must be willing to devote sufficient time to carrying out their duties and responsibilities effectively and should be committed to serving on the Board for an extended period of time. Current members of the Board with skills and experience that are relevant to our business and who are willing to continue in service are considered for re-nomination. If any member of the Board does not wish to continue in service, if the GS Committee decides not to re-nominate a member for re-election or determines to replace that director or if the Board considers increasing the size of the Board, the Board identifies the desired skills and experience for a new nominee in light of the composition of the Board and criteria described above. Pursuant to its charter, if a stockholder nominates a director in accordance with the director nomination procedures described in the bylaws, the GS Committee will consider that nomination and evaluate such stockholder nomination in the same manner as it evaluates other nominees. Additionally, certain eligible stockholders may include one or more director nominees in our proxy statement without the GS Committee’s approval of such nominees, provided that the stockholders comply with certain disclosure requirements and notification procedures as described in greater detail in our bylaws.
2025 Compensation of Directors
2025 Compensation of Directors The table below summarizes total compensation paid to or earned by each of our non-employee directors for service during 2025.
2025 Compensation of Directors
| Name | Fees Earned or Paid in Cash (1) ($) | Stock Awards (2) ($) | Total ($) | | Alan Campbell (3) | 262,500 | 225,004 | 487,504 | | Susan K. Carter | 138,695 | 225,004 | 363,699 | | Thomas L. Deitrich | 112,500 | 225,004 | 337,504 | | Bruce E. Kiddoo | 110,000 | 225,004 | 335,004 | | Christina Lampe-Önnerud (4) | 180,451 | — | 180,451 | | Paul A. Mascarenas | 83,332 | 266,802 | 350,134 | | Gregory L. Waters | 114,437 | 225,004 | 339,441 | | Christine Y. Yan | 120,000 | 225,004 | 345,004 | | (1) This column reflects cash retainers earned for board service in 2025. The schedule of fees is provided below under “Discussion of Director Compensation.” | | | | | (2) This column reflects the aggregate grant date fair value of the annual equity award granted to each non-employee director on May 15, 2025, computed in accordance with FASB ASC Topic 718 (the closing price on the date of grant multiplied by the number of shares granted). For Mr. Mascarenas, this figure also includes the grant date value of 896 fully-vested shares issued to him in lieu of a portion of his cash fees under our Stock Election and Deferral Plan for non-employee directors (described below). As of December 31, 2025, each sitting non-employee director held a total of 5,054 shares of restricted stock or restricted stock units, all of which are scheduled to vest on the day prior to the annual meeting. In addition, each of Ms. Yan and Mr. Mascarenas held 3,083 fully-vested but deferred restricted stock units, which will settle and pay out in shares of our common stock at a later date in accordance with the director’s election under the Stock Election and Deferral Plan. | | | | | (3) As previously announced, Mr. Campbell is retiring from the Board at the end of his current term, which expires immediately prior to the annual meeting. | | | | | (4) Ms. Lampe-Önnerud’s board service ended on May 14, 2025 (just prior to our 2025 annual meeting of stockholders). She did not receive a stock award during 2025. | | | |
Discussion of Director Compensation
Discussion of Director Compensation Our Board has delegated responsibility for reviewing and determining non-employee director compensation to the HCC Committee. The HCC Committee reviews the compensation payable to our non-employee directors annually. In determining compensation and benefits for our non-employee directors, the HCC Committee is guided by three goals: (i) to fairly compensate non-employee directors for the work required to serve as a director of a public company of our size and scope; (ii) to align non-employee directors’ interests with the long-term interests of our stockholders; and (iii) to structure the program in a way that is straightforward, transparent and aligned with corporate governance best practices. Generally, the HCC Committee believes that these goals are served by compensating non-employee directors with a mix of cash and equity-based awards. The current program consists of annual cash retainers and an annual equity grant, with an opportunity to take fully-vested shares in lieu of some or all of the annual cash retainers and to defer receipt of the shares underlying the annual equity grant. In May 2025, FW Cook provided the HCC Committee with an analysis of our non-employee director compensation program and pay levels, including a comparative review of director compensation programs among the same peer group we use to evaluate executive compensation. Taking into consideration FW Cook’s analysis and recommendations, the HCC Committee determined to maintain pay levels (cash and equity) consistent with pay levels in the previous fiscal year.
Highlights of Our 2025 Executive Compensation Program
Highlights of Our 2025 Executive Compensation Program The HCC Committee believes that the design and outcomes of our 2025 executive compensation program were directly tied to our performance and advanced our strategic priorities for 2025 and beyond. Changes to the 2025 Executive Compensation Program. At the beginning of the year, considering, among other things, the Company’s recent performance, uncertain market conditions and slowing of demand in our key sectors, and feedback received from investor outreach efforts, the HCC Committee, following discussions with other independent directors, management and FW Cook, made the following executive compensation decisions: •No Change in Pay Levels. We maintained the current compensation level for each of our NEOs, with the CEO’s total target direct compensation (base salary, target STI, and normal course annual LTI award) remaining unchanged since 2023. •STI Program Design. Our 2025 STI program is generally consistent with 2024 design, but we decreased the strategic portion of our CEO’s individual goals, which serves to cap any payout under the Corporate Multiplier, from 50% to 15%. •LTI Program Design. Our 2025 LTI program is generally consistent with 2024 design, except: ◦Added Free Cash Flow Metric — replaced the non-GAAP operating margin metric with free cash flow, supporting our stated commitment to generating strong cash flow and eliminating overlap with STI program metrics; ◦Increased Weighting of Performance-Based Portion of CEO’s LTI award — recalibrated the mix of our CEO’s LTI award to increase the percentage issued in the form of performance-based restricted stock units (PBRSUs) to 70% (up from 60% weighting in prior years), with the remaining 30% issued in the form of time-based restricted stock units (RSUs), resulting in an LTI award that is more heavily performance-based as compared to peer company and broader market practice; and ◦Increased Weighting of Financial Goals and Impact of TSR — increased the percentage of PBRSUs allocated to financial goals (85.7% for Mr. El-Khoury and 83.3% for each other NEO), up from 50% weighting in prior years, which also means that a higher percentage of the award will remain subject to up or down adjustment based on our relative total stockholder return (TSR) over the award’s three-year cycle. In addition, given prevailing market conditions and the Company’s recent TSR performance, Mr. El-Khoury advised the HCC Committee that he would forgo any potential payout under the 2025 STI program. However, consistent with past practices, he would continue to track and score his individual goals under the 2025 STI program and make progress reports to the HCC Committee and the Board on a quarterly basis. By the end of 2025, as noted in the Proxy Statement Summary under “2025 Performance Highlights,” we were able to deliver solid results despite reduced demand in our key end-markets. As a result, our incentive programs yielded mixed payouts against the goals set by the HCC Committee at the beginning of the year as summarized below. Payouts under the 2025 STI Program. As in prior years, the two performance components of our 2025 STI program were our Corporate Multiplier (based on our achievement of correlated revenue and non-GAAP operating margin metrics) and each NEO’s Individual Goals. The Individual Goal percentage achievement is capped at 100%, which means that it may only decrease, but not increase, any amounts earned based on the Corporate Multiplier. •Company Results. For 2025, we achieved revenue and non-GAAP operating margin of $5,995.4 million and 18.7%, respectively, both of which fell below their respective target levels that were tied to our Board-approved annual operating plan (AOP) for 2025, but above their respective threshold levels. •Pay Results. Our correlated revenue and operating margin results yielded a 72.7% achievement on the Corporate Multiplier compared to a maximum possible percentage of 200%. The final STI combined performance percentage (Corporate Multiplier x Individual Goals achieved) for our CEO was just below 59% of target (although his actual payout was 0% in accordance with his previous commitment to forgo any bonus payouts) and between 44-61% of target for each of our other NEOs. Annual Grants under 2025 LTI Program. As noted above, 70% of Mr. El-Khoury’s 2025 LTI grant consisted of PBRSUs while, as in prior years, 60% of each other NEO’s annual LTI grant consisted of PBRSUs. These PBRSUs, which pay out over a three-year period, include three separately-scored, one-year goals and a one-, two- and three-year relative total stockholder return (TSR) payout adjustment component to ensure that the award is linked to performance over the full three-year period. Specifically, the three goals included two financial metrics (new product revenue and progress toward the Company’s long-term free cash flow model) and one strategic metric (related to the successful implementation of certain stages of the Company’s Digital Threads initiative). •Company Results. With respect to our financial goals, the Company’s 2025 new product revenue was $1,323 million, which exceeded the target level but fell below stretch. In addition, the Company achieved a record-high 23.7% of free cash flow for the year, which was slightly below the target we had set but above the threshold level. On our strategic goal, we met our target goal of implementing a new enterprise resource planning system as well as our stretch goal of implementing five additional applications during 2025. •2025 Results. Based on our level of achievement against the financial and strategic goals, the combined weighted overall payout for our 2025 PBRSUs was 108% (for the CEO) or 113% (for each of our other NEOs). However, our one-year relative TSR decreased the first tranche percentage payout tied to financial metrics (proportionally, nearly 86% of the CEO’s target PBRSUs) by 50%. As a result, the combined payout percentage for the first tranche of our 2025 PBRSUs was 69% of target for our CEO and 73% of target for each of our other NEOs, in each case, compared to the maximum possible payout of approximately 221% of target. •Future Payouts Will Adjust (Up or Down) Based on Two- and Three-Year Relative TSR Results. The combined payout on each of the second and third tranches of our 2025 PBRSUs will vary between 69-148% of target (for the CEO) and between 73-152% of target for each NEO, depending on our two- or three-year relative TSR performance. 2025 Payouts on Previously-Granted PBRSUs Reduced Based on Relative TSR Results. Finally, based on our relative TSR results for the two- and three-year periods ended December 31, 2025, payouts related to the financial metrics of PBRSUs granted in prior years (the second tranche of our 2024 PBRSUs and the third tranche of our 2023 PBRSUs, respectively), were reduced by 50%. As a result, the combined payout on the second tranche of our 2024 PBRSUs was 89% of target and on the third tranche of our 2023 PBRSUs was 104% of target, in each case, compared to a maximum possible payout of approximately 213% of target. Each of these 2025 decisions and results is discussed in greater detail under “Our 2025 Incentive Programs.”
Overview of our Compensation Program
| Focus | Component | Key Characteristics | Purpose | | Baseline Compensation | Base Salary | •Fixed cash compensation | •Set at market competitive levels and used to attract and retain talent | | Current Year Performance | Short-term Cash Incentive (STI) Awards | •Annual cash awards providing for award opportunities based on full-year 2025 results •Performance goals based on both (1) Company financial results and (2) individually-scored performance goals | •Encourages our executives to maximize profitability and growth •Promotes superior operational performance, disciplined cost management and increased productivity and efficiency that contribute significantly to value creation for our stockholders | | Long-Term Equity Incentive (LTI) Awards | Restricted Stock Units (RSUs) | •Stock-settled awards •The 2025 RSUs are time-based and vest annually in one-third increments on each anniversary of the grant date •The 2025 PBRSUs are performance-based and are eligible to vest based on the extent to which the applicable performance goals established by the HCC Committee are met over performance measurement periods of one, two and three years | •Aligns executive and stockholder interests, further reinforced by application of relative TSR modifier on PBRSUs •Provides each individual with a significant incentive to manage from the perspective of an owner •Promotes employee retention •Assists NEOs in complying with stock ownership guidelines | | | Performance-Based Restricted Stock Units (PBRSUs) | | |
Overview of our Compensation Program
| Focus | Component | Key Characteristics | Purpose | | Post-Termination Compensation | Severance and Change in Control Arrangements | •Our RSU and PBRSU agreements provide for acceleration of vesting upon certain qualifying terminations, both with or without a change in control •Employment agreements provide severance payments and benefits in the event of certain qualifying terminations, both with or without a change in control | •Supports retention and recruitment efforts •Encourages management to pursue transactions that may be in the best interest of the Company and its stockholders by providing a measure of financial security | | Other Compensation and Benefits | Non-Qualified Deferred Compensation Plan | •Provides our senior officers the opportunity to elect to defer receipt, and thus taxation, of cash amounts that would otherwise be paid to them currently | •Gives officers an additional retirement savings vehicle •No Company match; funded solely by elective participant deferrals | | | Limited Perquisites | •A monthly auto allowance •Enhanced coverage for life insurance •An executive physical examination •Financial planning services reimbursement •Digital home security and data protection services (new for 2025) | •Supports the competitiveness of our compensation package •Provides value to executives at a reasonable cost to the Company •Helps our senior officers maintain strong cybersecurity practices and minimize risks to the Company | | | Other Benefit Plans and Programs | •A tax-qualified ESPP •A 401(k) savings plan •Medical, dental, disability and life insurance programs | •These programs are generally available to U.S.-based employees •Provides competitive capital accumulation and other benefits |
Performance-Driven Pay Opportunities - Target Total Direct Compensation
Performance-Driven Pay Opportunities - Target Total Direct Compensation The three primary components of our executive compensation program, which we refer to as target total direct compensation (TDC), are base salary, target STI award opportunity and target LTI awards, which consist of (i) 70% PBRSUs and 30% RSUs for Mr. El-Khoury and (ii) 60% PBRSUs and 40% RSUs for each of the other NEOs. Together, these components enhance stockholder value by providing our executives with a competitive compensation package that is significantly performance-based, thus linking executive pay, company performance and absolute and relative stockholder returns. No Increases to Target TDC Levels in 2025. In February 2025, given continued uncertainty in our key end-markets, the Company’s recent performance and ongoing restructuring efforts, and following discussions with FW Cook, the HCC Committee determined not to increase target TDC levels for any of the NEOs. We have not increased target TDC for any of our NEOs since February of 2023, except for promotion-based adjustments for Mr. Gopalswamy in 2024 to reflect his increased responsibilities (assuming leadership of a second business unit). For 2025, ongoing target TDC for each of our NEOs was as follows:
Performance-Driven Pay Opportunities - Target Total Direct Compensation
| Target Total Direct Compensation | | | | | | | | NEO | Base Salary ($) | Target STI (1) ($) | Target LTI ($) | 2025 Target TDC ($) | Increase from 2024 Target TDC | | | | | | | | ($) | (%) | | Hassane El-Khoury | 1,200,000 | 2,100,000 (2) | 16,750,000 | 20,050,000 | 0 | —% | | Thad Trent | 675,000 | 843,750 | 6,000,000 | 7,518,750 | 0 | —% | | Sudhir Gopalswamy | 600,000 | 600,000 | 4,500,000 | 5,700,000 | 0 | —% | | Simon Keeton | 600,000 | 600,000 | 4,500,000 | 5,700,000 | 0 | —% | | (1) These targets represent a percentage of base salary - 175% for Mr. El-Khoury, 125% for Mr. Trent, and 100% for each of Messrs. Gopalswamy and Keeton. | | | | | | | | (2) This reflects Mr. El-Khoury’s normal course target STI. Given that Mr. El-Khoury elected to forgo any STI payout for 2025, his actual 2025 Target STI was $0 resulting in an actual 2025 Target TDC of $17,950,000, or a 10% decrease from 2024 Target TDC. | | | | | | |
Performance-Driven Pay Opportunities - Target Total Direct Compensation
As reflected in the table above and the charts below, approximately 94% of Mr. El-Khoury’s normal course target TDC is variable, with approximately 69% based on measurable performance goals (target STI and PBRSUs, collectively “Performance Pay” in the charts below) and an additional 25% tied to the value of our stock price (RSUs). However, given Mr. El-Khoury’s election to forgo any STI payout for 2025, approximately 93% of his actual 2025 target TDC (salary and target LTI) was variable, with approximately 65% based on measurable performance goals (PBRSUs) and an additional 28% tied to the value of our stock price (RSUs). On average, approximately 91% of target TDC for our other NEOs was variable.
Our 2025 Incentive Programs
Our 2025 Incentive Programs Short-Term Cash Incentive Program. The primary objectives of our 2025 STI program were to: •reward and retain our top performers; •reward achievement of short-term financial performance goals; •use objective and verifiable metrics; •create a single program for all eligible non-manufacturing employees; and •provide target STI percentages that are competitive with peer and survey market data for the position. In designing the 2025 STI program, the HCC Committee considered these objectives and its desire to directly align the program with our 2025 strategic objectives and encourage our executives to maximize profitability, growth and operational efficiency. As further described below, the 2025 STI program incorporates overall company-wide objectives (the Corporate Multiplier) that determine the maximum payout percentage under the program and objectives specific to each NEO (the Individual Goal achievement percentage) that serve to cap each officer’s specific payout. The use of a Corporate Multiplier combined with an Individual Goal achievement percentage for each NEO supports one key tenet of our compensation philosophy — to provide incentive opportunities for both company and individual performance. Under the 2025 STI program, each eligible NEO’s payout was determined according to the formula below: Use of Non-GAAP Measures. Several of the financial targets in the Corporate Multiplier and Individual Goals were non-GAAP measures. The HCC Committee determined that non-GAAP metrics should be used for the 2025 STI program rather than GAAP metrics to prevent payments under the 2025 STI program from being significantly impacted (positively or negatively) by extraordinary or unusual events or non-cash items. The HCC Committee also considered adjustments eliminating the effect of certain non-cash items to be appropriate, believing that the adjusted numbers are a better indicator of the Company’s actual operating performance. For a reconciliation of GAAP to non-GAAP measures included in this proxy statement, please see the Appendix. Corporate Multiplier Component. Consistent with prior years, our 2025 STI program included a performance matrix, the Corporate Multiplier, that links two financial metrics (revenue and non-GAAP operating margin) and reflects threshold‐to‐maximum opportunities based on various achievement levels of each metric. This Corporate Multiplier is designed to ensure that funding of the 2025 STI program is in line with our Board-approved AOP. As a result, “target” is set at our AOP levels. If we achieve target levels on both metrics by meeting our AOP, the Corporate Multiplier would be 100%. The Corporate Multiplier can range from 0% to up to a maximum of 200% for performance meeting or exceeding stretch levels. Given the use of a matrix, there are multiple ways to calculate (and achieve) threshold, target and maximum performance. The Corporate Multiplier establishes the maximum that may be earned by a given participant under our STI program. For 2025, our annual revenue and non-GAAP operating margin targets were $6.151 billion and 19.3%, respectively. These targets represented year-over-decreases from our 2024 results of 13.1% in revenue and a 860 bps decrease in non-GAAP operating margin. These 2025 targets reflected our expectation that the slowdown in our key sectors would persist throughout the year and that manufacturing utilization would remain depressed amid market uncertainty. While these were lower targets numerically from the prior year, the HCC Committee believed that these goals were challenging but achievable, consistent with the rigor of goals set under our prior year STI programs in light of our expectations about the near-term business outlook. At the end of the year, based on our combined results for 2025, we achieved a Corporate Multiplier of 72.7% of target as shown in the table below.
Our 2025 Incentive Programs
| Corporate Multiplier Component (matrix-based correlation) | 0% Achievement (Threshold) (1) | 100% Achievement (Target) (2) | 200% Achievement (Maximum) (3) | Actual Achievement | | Revenue | $5.840 billion | $6.151 billion | $6.909 billion | $5.995 billion | | Non-GAAP Operating Margin (4) | 17.0% | 19.3% | 24.3% | 18.7% | | Final Corporate Multiplier | | | | 72.7% | | (1) Under the matrix, no payout would be earned if either of these thresholds were not met, regardless of performance on the other. | | | | | | (2) Aligned with our 2025 Board-approved AOP. | | | | | | (3) This combination of revenue and operating margin is only one way to achieve maximum payout. Under the matrix, we could also achieve 200% with an operating margin of 23.8% but only if our revenue met or exceeded $7.098 billion. | | | | | | (4) Non-GAAP operating margin is calculated as disclosed in our earnings releases. Please see the Appendix for a reconciliation to GAAP. | | | | |
Our 2025 Incentive Programs
Individual Goal Component. In addition to the Corporate Multiplier, each NEO received a score based on the level of achievement of his Individual Goals. The Individual Goal component represents a potential downward adjustment to each NEO’s STI payout, and does not provide additional payout opportunities. Specifically, the Individual Goal achievement percentage, which is capped at 100%, is applied against the final Corporate Multiplier, which means that performance at less than target will serve to decrease any STI payout to that participant. For 2025, for our NEOs other than Mr. Gopalswamy, this component is divided into two-equally weighted categories: financial goals (NEO Financial Goals) and certain executive-specific strategic or operational goals (NEO Non-Financial Goals). For Mr. Gopalswamy, who leads both AMG and ISG and whose Individual Goal achievement percentage is the average of his scores for each business unit, 100% of his individual goals for ISG for 2025 were NEO Financial Goals (no non-financial goal component), resulting in 75% of his overall Individual Goals being NEO Financial Goals. In addition, in a change from prior year programs, in selecting the appropriate executive-specific goals for Mr. El-Khoury, the HCC Committee limited the use of strategic goals to 15% of his total Individual Goal component (or 30% of his NEO Non-Financial Goals). The NEO Financial Goals – this portion is tied to three corporate financial targets. For the 2025 STI program, the scoring of the NEO Financial Goals was based on our level of achievement of revenue, non-GAAP gross margin and non-GAAP operating expense targets as described in the table below. Each of the goals is scored separately and can result in attainment of up to 100% of this component for results at or above target. Further, although the targets are stated as annual goals, progress is generally measured quarterly so that if points are lost based on results in a given quarter, those points cannot be made up in a subsequent quarter even if the final full year results for that goal actually meet or exceed the annual target. For 2025, this occurred with respect to the Company-wide gross margin goal and the AMG-specific gross margin and operating expense goals. While the annual goal for each of the three was met, each of these goals paid out at less than 100% based on quarterly performance, as shown in the last column of the table below.
Our 2025 Incentive Programs
| NEO Financial Goals and Weighting (1) | 0% Achievement (Threshold) | 100% Achievement (Target) | Annual Results | Scoring (% Earned) | | Revenue (40% of NEO Financial Goals) | Company: $5.84 billion | Company: $6.15 billion | Company: $5.995 billion | 51% | | | AMG: $2.177 billion | AMG: $2.292 billion | AMG: $2.262 billion | 75% | | | ISG: $864 million | ISG: $909 million | ISG: $928 million (2) | 100% | | | PSG: $2.803 billion | PSG: $2.950 billion | PSG: $2.804 billion | 50% | | Non-GAAP Gross Margin (40% of NEO Financial Goals) | Company: 37.4% | Company: 38.4% | Company: 38.4% | 85% | | | AMG: 48.5% | AMG: 49.5% | AMG: 51.4% | 93% | | | ISG: 38.4% | ISG: 39.4% | ISG: 40.3% (2) | 100% | | | PSG: 28.3% | PSG: 29.3% | PSG: 27.3% | 0% | | Non-GAAP Operating Expense (20% of NEO Financial Goals) | Company: $1.195 billion | Company: $1.172 billion | Company: $1.185 billion | 46% | | | AMG: $521 million | AMG: $511 million | AMG: $510 million | 50% | | | ISG: $223 million | ISG: $219 million | ISG: $222 million | 38% | | | PSG: $452 million | PSG: $443 million | PSG: $447 million | 50% | | (1) The non-GAAP NEO Financial Goals (gross margin and operating expense) are calculated as disclosed in our earnings releases. Please see the Appendix for a reconciliation to GAAP. | | | | | | (2) For each of these two ISG-specific goals, the overall annual targets were exceeded although not all of the quarterly targets were met. Given that there had been changes in strategy for the business unit over the course of the year and the annual targets were ultimately met, the HCC Committee determined to assess these metrics on an annual (rather than quarterly) basis for 2025. | | | | |
Our 2025 Incentive Programs
For each of Messrs. El-Khoury and Trent, his NEO Financial Goals were calculated based on Company-wide performance, resulting in 63.52% of the NEO Financial Goals being achieved for each. For each of our other NEOs, his NEO Financial Goals were measured against the results for his specific business unit. For Mr. Gopalswamy, the NEO Financial Goal achievement percentages for his two business units were 76.90% (AMG) and 81.46% (ISG). For Mr. Keeton, this resulted in 30.00% of his NEO Financial Goals being achieved for PSG. The NEO Non-Financial Goals – this portion is generally composed of between three and seven additional metrics and targets specifically tailored to each NEO’s role, area of oversight and strategic focus, including financial and non-financial goals and other metrics. These metrics are selected to both measure and support management’s strategy and the planning and execution of certain transformation initiatives, including ESG, new product, quality improvement, human capital and operational initiatives. The NEO Non-Financial Goals were scored: (i) for certain binary metrics, at either 0% or 100% attainment without linear interpolation between the attainment levels, or (ii) at up to 100% attainment, with linear interpolation for attainment between the threshold and target levels. Like the NEO Financial Goals, each NEO Non-Financial Goal was scored separately and each was weighted with a specific point value based on its strategic importance and/or the level of complexity involved in achieving the goal. Particular scoring metrics used to determine whether a given target had been achieved were also established at the time the 2025 STI program was approved. For 2025, our CEO’s NEO Non-Financial Goals consisted of the following: •Planning and executing strategic initiatives (30%, or 15% of his overall Individual Goals). This goal measured management’s progress on fourteen specific initiatives that had been identified as priorities for the year. •Meeting specific new product development milestones (60%, or 30% of his overall Individual Goals). This goal consisted of five specific customer projects or technology initiatives for the year, each with quantifiable targets or defined milestones to meet. •Corporate quality (10%, or 5% of his overall Individual Goals). This goal assessed the Company’s progress towards improving product quality by comparing the number of customer quality reports during the year against a pre-established target, which was set a level requiring year-over-year improvement. Following the end of the year, the HCC Committee evaluated each NEO’s performance against the relevant metrics, which yielded each NEO’s Individual Goal achievement percentage, as follows:
Our 2025 Incentive Programs
| NEO | NEO Financial Goals (50% weighting) | NEO Non-Financial Goals (50% weighting) | Final Individual Goal Achievement Percentage | | Hassane El-Khoury | 63.52% | 98.44% | 80.98% | | Thad Trent | 63.52% | 89.60% | 76.56% | | Sudhir Gopalswamy* | | | 83.41% | | AMG-specific | 76.90% | 93.82% | | | ISG-specific | 81.46% (100% weighting) | — | | | Simon Keeton | 30.00% | 91.38% | 60.69% | | * Mr. Gopalswamy’s Individual Goal achievement percentage is the average of the scores for his two business units. For 2025, all of his ISG-specific Individual Goals were NEO Financial Goals. | | | |
Our 2025 Incentive Programs
Determination of Payouts under the 2025 STI Program. As noted previously, Mr. El-Khoury elected to forgo any potential payout under the 2025 STI Program in light of the Company’s restructuring efforts and thus did not receive any payout. In February 2026, the HCC Committee approved the following payouts to each of our other NEOs under the 2025 STI Program:
Our 2025 Incentive Programs
| NEO | Corporate Multiplier (%) | Individual Goal Achievement Percentage (%) | Combined Performance Percentage* (%) | STI Target (% of Base Salary) | Base Salary ($) | Final Cash STI Payment ($) | | Hassane El-Khoury | 72.70% | 80.98% | 58.87% | 175% | 1,200,000 | 0 | | Thad Trent | 72.70% | 76.56% | 55.66% | 125% | 675,000 | 469,631 | | Sudhir Gopalswamy | 72.70% | 83.41% | 60.64% | 100% | 600,000 | 363,840 | | Simon Keeton | 72.70% | 60.69% | 44.12% | 100% | 600,000 | 264,720 | | * Reflects Corporate Multiplier multiplied by the NEO’s Individual Goal achievement percentage. | | | | | | |
Our 2025 Incentive Programs
Long-Term Incentives. In February 2025, the HCC Committee approved our 2025 LTI program under which each NEO received an annual award of PBRSUs and RSUs with the same grant date target value level as the 2024 normal course annual awards. As noted previously, the HCC Committee made the following changes to the performance-driven elements of the program as compared to 2024: •Eliminated Metric Overlap — replaced the operating margin goal with a free cash flow goal, which eliminated overlapping incentive plan metrics; and •Increased Weighting of Financial Goals and Impact of TSR on Payout — significantly increased the weighting of the financial goals used in the PBRSUs (from 50% to 85.7% for our CEO and 83.3% for our other NEOs), with a corresponding decrease to the strategic goals (from 50% to 14.3% for our CEO and 16.7% for our other NEOs), which resulted in a higher percentage of the award remaining subject to one-, two- and three- year relative TSR adjustments over the award’s full three-year cycle. The HCC Committee also increased the percentage of Mr. El-Khoury’s LTI award that is performance-based to 70% PBRSUs (from 60%) and allocated the entire 10% to one financial goal (free cash flow). Annual Grants under our 2025 LTI Program. Our 2025 LTI program reflects the following principles: •equity-based awards should comprise the largest percentage of each NEO’s annual target TDC in order to further align NEO and stockholder interests; •equity grants are budgeted consistent with market practice with actual grants awarded based on performance and potential and dependent upon short- and long-term stock price performance; •the performance goals underlying our PBRSUs are designed to drive behavior in support of our AOP and long-term business strategies; •performance above target or above stretch levels should provide commensurate payout opportunities; and •company, department and individual performance may drive above-market equity grants in the following annual cycle. The HCC Committee granted annual awards to each NEO as described in the following table. While Mr. El-Khoury’s award consisted of 70% PBRSUs (the 2025 PBRSUs) and 30% RSUs (the 2025 RSUs), the HCC Committee elected to maintain the 60% PBRSUs and 40% RSUs allocation for each of the other NEOs. The HCC Committee determined that these allocations between PBRSUs and RSUs provided a reasonable balance between performance-based and retention incentives. The number of RSUs and target PBRSUs awarded was determined by dividing the grant date target value by the closing price of a share of our common stock on the date of grant, and rounding up to the next whole share if necessary.
Our 2025 Incentive Programs
| 2025 LTI Program - Annual Grants to NEOs | | | | | | | NEO | Target 2025 PBRSU Value* ($) | 2025 PBRSUs (at Target) (#) | Target 2025 RSU Value ($) | 2025 RSUs (#) | Total Target 2025 LTI Value (PBRSUs + RSUs) ($) | | Hassane El-Khoury | 11,725,000 | 216,929 | 5,025,000 | 92,970 | 16,750,000 | | Thad Trent | 3,600,000 | 66,605 | 2,400,000 | 44,404 | 6,000,000 | | Sudhir Gopalswamy | 2,700,000 | 49,954 | 1,800,000 | 33,303 | 4,500,000 | | Simon Keeton | 2,700,000 | 49,954 | 1,800,000 | 33,303 | 4,500,000 | | * These values differ from the values reported in the SCT and the Grants of Plan Based Awards table, which, as required by SEC rules, are calculated in accordance with FASB ASC Topic 718. | | | | | |
Our 2025 Incentive Programs
Description of 2025 RSUs. As in prior years, the 2025 RSUs are time-based and will vest annually in one-third increments on each anniversary of the grant date, subject to the NEO’s continued employment through the applicable vesting date. Description of 2025 PBRSUs. The 2025 PBRSUs are performance-based equity awards for which vesting is contingent upon our achievement of three performance goals (the 2025 LTI Performance Goals) and a TSR modifier that adjusts a portion of final payouts, up or down, based on our one-, two- and three-year TSR performance relative to a defined peer group. As detailed in the next chart, two of the 2025 LTI Performance Goals are financial (LTI Financial Goals) and the third is strategic (LTI Strategic Goal), with each of the three goals scored separately. While all three goals measured performance over the 2025 fiscal year, the awards will pay out in equal installments over a three-year period with the payout under each tranche of the LTI Financial Goals (85.7% of Mr. El-Khoury’s target award and 83.3% of each other NEO’s target award) further adjusted (between 50-150%) based on our TSR relative to a peer group over the one-, two- or three-year periods beginning on January 1, 2025 and ending on December 31 prior to each vesting date (the TSR Adjustment). The tranche-by-tranche TSR Adjustment helps to ensure that the awards remain linked to performance over the full three-year payout period.
Our 2025 Incentive Programs
| Step 1 - Measure Performance Against LTI Performance Goals | | | | | | Type of Goal | LTI Goal | Description and Measurement | Max Payout (as a % of Target) | Subject to Step 2 TSR Adjustment? | | Financial (85.7% weighting)* | New Product Revenue | Revenue from the sale of new products in 2025, derived from our 2025 financial statements | 150% | Yes - subject to one-, two- and three-year relative TSR adjustment (see below for details) | | | Progress toward Long-Term Free Cash Flow Model | Free cash flow percentage for 2025 as derived from our 2025 financial statements; calculated based on information in the GAAP reconciliation appendix to our earnings release | 150% | | | Strategic (14.3% weighting)* | Digital Threads Initiative | Measured against the Company’s implementation timeline and rollout plans for its Digital Threads initiative | 200% | No TSR Adjustment | | * Reflects the percentage weighting for the PBRSUs granted to our CEO. The PBRSUs granted to each other NEO are weighted 83.3% financial and 16.7% strategic (Digital Threads initiative). The percentage weighting breakdown between the two financial metrics is included in the next table. | | | | |
Our 2025 Incentive Programs
We believe that using a mix of performance periods in our LTI program emphasizes different priorities. All three of our 2025 LTI Performance Goals, while measured over a one-year period, are forward-looking and establish a baseline to help us achieve our longer-term strategic goals. Having our PBRSUs vest over a three-year period, with a significant majority of the ultimate payout remaining variable, to be adjusted up or down with our relative TSR performance measured from January 1 of the year of grant to December 31 of the year before each scheduled vesting date, links overall payout of these awards to longer-term stockholder returns. Considerations Regarding 2025 LTI Performance Goals. The 2025 LTI program was designed to reward performance consistent with our long-term strategic objectives. Similar to our 2025 STI program, the HCC Committee determined that the use of certain non-GAAP metrics would be more appropriate for our 2025 LTI program than GAAP metrics as it would prevent 2025 LTI payouts from being significantly impacted (positively or negatively) by extraordinary or unusual events or non-cash items. The HCC Committee also considered adjustments eliminating the effect of certain non-cash items to be appropriate, believing that the adjusted numbers are a better indicator of our Company’s actual operating performance. The HCC Committee assessed the advantages and disadvantages of using absolute versus relative performance measures and believes that the 2025 LTI Program struck an appropriate balance by using both types of measures in the PBRSU grants. Absolute measures are consistent with stockholder expectations, allow for greater sense of control and influence by the executive, encourage motivation and are consistent with our cash flow and ability to pay. Conversely, relative measures, such as our TSR Adjustment, result in adjustment, up or down, to payouts for our executives based on our performance compared to our peers in a highly competitive marketplace. The following is a summary of the specific targets under each of the 2025 LTI Performance Goals:
Our 2025 Incentive Programs
| Type of Goal | 2025 LTI Performance Goals Measured after 2025 PBRSU Performance Period (1) | Weighting (as % of Target LTI) (2) | 0% Payout (Threshold) | 100% Payout (Target) | 150% or 200% Payout (Stretch) | | Financial | New Product Revenue | 28.6% | $977 million | $1.256 billion | $1.535 billion | | Financial | Progress toward Long-term Free Cash Flow Model (3) | 57.1% | 17% | 25% | 35% | | Strategic | Progress on Digital Threads Initiative (4) | 14.3% | Delayed 4 weeks | Core | Core + 5 add-ons | | TSR Adjustment Measured after each TSR Performance Period | | | Payout Range | | | | Relative TSR | | | 50% to 150% (5) | | | | (1) All LTI Performance Goals other than the Digital Threads initiative goal are calculated in a manner consistent with how we calculate these figures for purposes of our earnings releases. Payouts under each 2025 LTI Performance Goal are determined using linear interpolation from threshold to target and from target to stretch. | | | | | | | (2) Reflects the weighting of the PBRSUs granted to our CEO; the PBRSUs granted to each other NEO are weighted 83.3% financial/16.7% strategic. | | | | | | | (3) Measures the percentage of 2025 revenue converted into free cash flow. It is calculated based on revenue and free cash flow metrics as disclosed in our earnings releases. Please see the Appendix for a reconciliation to GAAP. | | | | | | | (4) Measures our progress against specific milestones related to our implementation timeline for certain aspects of the Digital Threads initiative. We would achieve target payout if we implemented a core new system of record before the end of 2025, no payout if that implementation was delayed for 4 weeks, and 200% payout if the core system and at least five other add-ons were implemented by the end of 2025. | | | | | | | (5) As described above, the TSR Adjustment, which applies to the LTI Financial Goals, is a further adjustment (50%-150%) to the number of shares earned on the basis of our performance as measured against each LTI Financial Goal. | | | | | |
Our 2025 Incentive Programs
One-, Two- and Three-Year TSR Adjustments. As noted above, we include a relative TSR Adjustment in the design of our PBRSUs to emphasize the importance of our stock performance as compared to an industry peer group (for a discussion of this group’s composition, see below under “TSR Peer Companies”). Specifically, the number of PBRSUs vesting in each tranche as a result of the LTI Financial Goals will be adjusted (between 50-150%) based on our relative TSR over the performance period (one, two or three years) beginning on January 1, 2025 and ending on December 31 of the year immediately preceding the vesting date as follows:
Our 2025 Incentive Programs
| Step 2 - TSR Adjustment to Step 1 Results for Financial Goals | | | Relative TSR | TSR Adjustment (applied to Step 1 Financial Units in each Tranche) | | Equal to or greater than 75th Percentile | 150% (fixed) | | Greater than 50th but less than 75th Percentile | % determined by straight line linear interpolation | | At least 25th but no greater than 50th Percentile | 100% (fixed) | | Less than 25th Percentile | 50% (fixed) |
Our 2025 Incentive Programs
Considering both the step 1 and step 2 performance adjustments, the range of possible payouts for our 2025 PBRSUs is between 0-221.4% for our CEO of the target number in each tranche (between 0-220.8% for each of our other NEOs). The performance results for the first tranche of our 2025 PBRSUs are detailed below under “Results for PBRSUs with Performance Periods Ending in 2025.” TSR Peer Companies. To determine our relative TSR at the end of the applicable performance period, we calculate the percentage change between the beginning stock price and the ending stock price for our stock and that of each TSR peer company, assuming reinvestment of any dividends. For purposes of this calculation, we use the average closing stock price for the fourth fiscal quarter of 2024 as the beginning stock price and the average closing stock price for the fourth fiscal quarter of the last year in the TSR performance period as the ending stock price. We then determine the percentile rank of our TSR as compared to our peers over the same period. Unless the HCC Committee determines otherwise, any peer company that is no longer trading on a national securities market on the last day of the applicable performance period will be removed from the list for purposes of the relative TSR calculation for that period. For the 2025 PBRSUs, our TSR performance peer companies consist of the following companies:
Our 2025 Incentive Programs
| TSR Performance Peer Companies | | | | Ambarella Inc. | Maxlinear Inc. | Rohm Co., Ltd. | | ams AG | Melexis N.V. | Semtech Corporation | | Analog Devices, Inc. | Microchip Technology Incorporated | Sensata Technologies Holding plc | | Broadcom Inc. | MKS Instruments, Inc. | Silicon Laboratories Inc. | | Cirrus Logic, Inc. | Monolithic Power Systems, Inc. | Skyworks Solutions, Inc. | | Diodes Incorporated | Murata Manufacturing Co., Ltd. | STMicroelectronics N.V. | | Infineon Technologies AG | NXP Semiconductors N.V. | Synaptics Incorporated | | Knowles Corporation | Parade Technologies, Ltd. | Texas Instruments Incorporated | | Lattice Semiconductor Corporation | Power Integrations, Inc. | Vishay Intertechnology, Inc. | | Littelfuse, Inc. | Qorvo, Inc. | Wolfspeed, Inc.* | | Macom Technology Solutions Holdings, Inc. | Realtek Semiconductor Corp. | | | Marvell Technology, Inc. | Renesas Electronics Corporation | | | * Although Wolfspeed, Inc. was part of the original group of TSR performance peer companies approved by the HCC Committee for the 2025 awards, it went through restructuring during 2025. As a result, Wolfspeed has been excluded from the peer group for purposes of calculating relative TSR for awards with performance periods that include calendar year 2025. | | |
Our 2025 Incentive Programs
The TSR peer companies listed above represent a mix of companies listed on the PHLX Semiconductor Index and other publicly traded semiconductor companies whose product and service offerings, market capitalization, business model and other characteristics are similar to ours. Results for PBRSUs with Performance Periods Ending in 2025. First Tranche of 2025 PBRSUs. In early 2026, the HCC Committee reviewed the LTI Performance Goals underlying our 2025 PBRSUs and determined that our LTI Financial Goals were achieved at an aggregate 93% for our CEO (95% for each other NEO) and that our LTI Strategic Goal was achieved at 200%. However, given that our relative TSR for 2025 was at the 6th percentile among our peers, the number of units earned under the LTI Financial Goals was reduced by 50%, for a combined payout under the LTI Financial Goals of 47% for Mr. El-Khoury (48% for each other NEO) and an overall combined payout for the entire first tranche of the 2025 PBRSUs of 69% for Mr. El-Khoury (73% for each other NEO). A breakdown of performance by LTI Performance Goal is shown in the chart below.
Our 2025 Incentive Programs
| Type of Goal | LTI Performance Goal | 0% Payout (Threshold) | 100% Payout (Target) | 150% or 200% Payout (Stretch) | Actual 2025 Performance | Resulting Goal Achievement Percentage (1) | Final Payout Percentage for First Tranche (2) | | Financial | New Product Revenue | $977 million | $1.256 billion | $1.535 billion | $1.323 billion | 112% | 56% | | | Fiscal 2025 Free Cash Flow | 17.0% | 25.0% | 35.0% | 23.7% | 84% | 42% | | Strategic | Digital Threads Initiative | Delayed 4 weeks | Core | Core + 5 add-ons | Core + 5 add-ons | 200% | 200% | | | | | | First tranche combined payout percentage | | | 69% (3) | | (1) This column reflects the degree of achievement on each of the three goals, without giving effect to any TSR Adjustment. To calculate the number of PBRSUs preliminarily earned under each goal, we multiply this figure by the number of target PBRSUs granted to the NEO that were associated with that goal, then divide the result into three equal tranches. For the tranches associated with the LTI Strategic Goal, that number of PBRSUs is fixed and will be paid over a three-year period, subject to the NEO’s continued employment through each vesting date. The tranches associated with LTI Financial Goals are not fixed but rather will be adjusted, on a tranche-by-tranche basis, for our relative TSR performance over the one-, two- or three-year performance period, as applicable. | | | | | | | | | (2) This column reflects the payout percentages under each of the three goals for the first tranche, with the payout for each LTI Financial Goal reduced by 50% based on our relative TSR performance for 2025. | | | | | | | | | (3) Reflects the payout percentage to our CEO; for each other NEO, this payout percentage was 73%. | | | | | | | |
Our 2025 Incentive Programs
Payout on each of the second and third tranches (in 2026 and 2027, respectively) will be adjusted based on our relative TSR for the applicable two- or three-year period once those performance periods are complete. Based on performance thus far, the combined payout percentage for each of the second and third tranches of our 2025 PBRSUs will range between 69-148% of target (for the CEO) and between 73-152% of target for each other NEO. Relative TSR Results Reduced Payouts on 2023 and 2024 PBRSUs. In early 2026, the HCC Committee reviewed our two- and three-year relative TSR results for purposes of determining the final payouts under our 2024 and 2023 PBRSUs, respectively. Based on these results, the payouts related to financial metrics for each were reduced by 50%, resulting in the following overall combined payouts for each award:
Our 2025 Incentive Programs
| Award | Tranche | Step 1 Payout Percentage (1) (%) | Relative TSR Performance Period | Resulting Relative TSR Percentile | Final Combined Payout Percentage (2) (%) | Compared to Maximum Possible Payout Percentage (%) | | 2023 PBRSUs | Third (Final) | 133% | 1/1/2023-12/31/2025 | 24th Percentile | 104% | 213% | | 2024 PBRSUs | Second | 111% | 1/1/2024-12/31/2025 | 15th Percentile | 89% | 213% | | (1) Reflects the combined payout percentage for the award before any relative TSR adjustment. | | | | | | | | (2) Reflects the final combined payout percentage after application of the relative TSR adjustment (Step 2). For both 2023 PBRSUs and 2024 PBRSUs, this resulted in a 50% reduction in payouts related to financial metrics. | | | | | | |
All Other Compensation Programs
All Other Compensation Programs Post-Termination Compensation. In addition to the compensation received by our NEOs during 2025 and the other benefits under our programs available to all eligible employees, we also provide certain post-termination benefits to our executive officers as described below. Employment Agreements. We are party to an employment agreement with each of our NEOs. Under his agreement, each NEO would be entitled to certain post-termination payments in the event of a qualifying termination (whether in connection with, or outside of, a change in control). For more detail regarding the severance and change in control provisions of the employment agreements, see “Compensation of Executive Officers — Employment Agreements” and “Compensation of Executive Officers — Potential Payments Upon Termination of Employment or Change in Control” below in this proxy statement. Release Requirement and Restrictive Covenants. The HCC Committee believes that our post-termination compensation and related arrangements with our NEOs are aligned with existing market practices related to, and are consistent with, the principal objectives of our compensation programs. To the extent a NEO’s employment agreement contains severance benefits or a change in control provision, those benefits are predicated upon the NEO being terminated without cause (or resigning for good reason). In addition, an NEO’s receipt of any severance benefits is conditioned upon the NEO signing a general release and waiver and complying with certain restrictive covenants, including non-solicitation, confidentiality and non-disparagement agreements, as well as non-competition or non-interference agreements, all of which serve the best interests of onsemi and our stockholders. Advantages of Our Double-Trigger Change in Control Arrangements. The HCC Committee believes that our management plays a critical role in the success of our Company and that it is important to protect them with a baseline of guaranteed compensation in the event of an involuntary (or constructive) termination in connection with a change in control. Change of control protections for our executive officers and other key personnel are an important part of good corporate governance, as they alleviate individual concerns about the possible involuntary loss of employment and ensure that the interests of our executives will be materially consistent with the interests of other stockholders when considering corporate transactions. In addition, we believe that these change of control protections preserve morale and productivity and encourage retention in the face of the potential disruptive impact of an actual or potential change of control of onsemi. Non-Qualified Deferred Compensation Plan. We sponsor a non-qualified deferred compensation plan for senior officers (our NQDC Plan). Under the NQDC Plan, which is administered by the HCC Committee, eligible participants may elect to defer receipt of up to 80% of their cash compensation (base salary and/or STI payments) for a given year. The NQDC Plan consists solely of participant funds as the Company does not make any employer contributions, which would require HCC Committee approval. Participation is voluntary and deferral elections do not carry over from one year to the next; rather, participants must make deferral elections annually in the year prior to the year in which the compensation is earned. Participants may choose to have their deferred compensation paid in a lump sum or up to ten annual installments although all deferred amounts will be paid out in a single lump sum upon a participant’s death. As of December 31, 2025, none of our NEOs have elected to participate in the NQDC Plan. Limited Perquisites. Consistent with our pay-for-performance compensation philosophy, we provide our executive officers with the following limited perquisites: •a monthly auto allowance; •enhanced coverage for life insurance (coverage of $1,000,000, which is $500,000 above the maximum allowed standard coverage of two times base salary that is afforded to all employees); •an executive physical examination; •financial planning services reimbursement up to $10,000 per year; and •certain digital home security and data protection services, at a cost of approximately $7,500 per executive per year. The HCC Committee believes these limited perquisites help to maintain the competitiveness of our compensation package vis-à-vis our peer companies and provide value at a reasonable cost to us. Other Benefit Plans and Programs. We do not currently offer any executive retirement plans or pension benefits. Executives are eligible to participate in benefit programs available to all of our full-time employees. These generally available programs, which are designed to provide competitive capital accumulation and other benefits, include: •a tax-qualified employee stock purchase plan; •a 401(k) savings plan; and •medical, dental, disability and life insurance programs.
Process and Procedures for Considering and Determining Executive Compensation
Process and Procedures for Considering and Determining Executive Compensation Among other responsibilities, our HCC Committee is primarily responsible for establishing the compensation programs for our NEOs and other senior executives, including the CEO, as well as monitoring, annually reviewing and approving the goals and objectives relevant to these programs. Role of Compensation Consultants. The HCC Committee engaged FW Cook as its primary independent compensation consultant to assist in recommending the form and amount of executive and director compensation for our 2025 executive compensation programs. Among other things, with respect to our 2025 compensation programs, FW Cook: •reviewed our executive compensation program, including a peer group review and competitive pay assessments; •reviewed our STI and LTI programs and equity practices; •reviewed our non-employee director compensation program; •provided legislative and regulatory updates; •provided additional assistance, as requested, in analyzing and determining senior executive compensation and reviewing the CD&A; and •attended meetings of the HCC Committee as requested. After evaluating FW Cook’s independence in light of applicable SEC rules and Nasdaq listing standards, the HCC Committee has concluded that FW Cook is independent and that its work for the HCC Committee has not raised any conflict of interest. In determining compensation for our executive officers and non-employee directors, the HCC Committee considers information and advice provided by its independent compensation consultant. The HCC Committee believes that FW Cook has the requisite skills, knowledge, industry expertise and experience, as well as the necessary resources, to provide a comprehensive approach to executive and non-employee director compensation planning, strategy and governance. While the HCC Committee considers the advice and recommendations of its independent consultant, ultimately, the HCC Committee has the decision-making authority with respect to our compensation programs, including the specific amounts paid to our executive officers. Role of Senior Executives in Determining Executive Compensation. The HCC Committee made all compensation decisions related to our NEO compensation in 2025 except that the full Board (excluding Mr. El-Khoury) reviews and approves compensation for Mr. El-Khoury, taking into account the HCC Committee’s recommendations. However, our CEO and other senior executives regularly provide information and recommendations to the HCC Committee on the compensation and performance of other officers. Specifically, the CEO presents the HCC Committee with an individual performance overview for each executive officer, describing the officer’s accomplishments for the prior year, as well as his or her strengths, areas of improvement and development plans. The senior executives also assist the HCC Committee in determining the level of achievement of the performance targets underlying performance-based awards and incentives and provide other information specifically requested by the HCC Committee from time to time. With respect to the compensation of the CEO, FW Cook works directly with the HCC Committee, which makes a recommendation to the full Board (excluding Mr. El-Khoury). No NEO or any other member of management makes recommendations on the level of his or her own compensation. Use of Market Data. The HCC Committee considers competitive market data, among other factors, in determining the individual elements of our compensation programs and in allocating between cash and non-cash compensation and between STI and LTI compensation. Although the peer company or other survey data is a starting point and a significant factor in the HCC Committee’s compensation determinations, it is not the only factor. During 2024, FW Cook conducted an executive compensation study and made recommendations regarding changes to compensation design for our 2025 programs (the FW Cook Report). The HCC Committee used data provided in the FW Cook Report to assist in structuring the 2025 compensation packages for our NEOs. The FW Cook Report included, among other things, a comparative analysis of our executive pay levels against both a defined group of peer companies and broader survey data. In determining whether to recommend any changes to our 2024 peer group for purposes of preparing the FWC Report, FW Cook evaluated existing and potential peer companies against the following criteria: •revenue between approximately 0.4 to 3 times our revenue; •twelve-month average market capitalization between approximately 0.33 to 5 times our market capitalization; •industry screens pertaining to other semiconductor, semiconductor equipment and broader technology hardware companies; •peer groups that Institutional Shareholder Services Inc. and Glass, Lewis & Co. LLC utilize for onsemi; •analyses of the “peers of current peers” as of the date of the FW Cook Report and of other companies using onsemi as a benchmark; and •onsemi’s relative TSR performance peer group. After considering these criteria, the HCC Committee, in consultation with FW Cook, decided to make no changes to the Company’s peer group for purposes of the 2025 executive compensation program. The resulting peer group identified to inform 2025 compensation decisions (the 2025 Peer Group) consisted of:
Process and Procedures for Considering and Determining Executive Compensation
| 2025 Peer Group | | | Advanced Micro Devices, Inc. | Micron Technology, Inc. | | Analog Devices, Inc. | Monolithic Power Systems, Inc. | | Applied Materials, Inc. | NXP Semiconductors N.V. | | First Solar, Inc. | Qorvo, Inc. | | Lam Research Corporation | Skyworks Solutions, Inc. | | Marvell Technology, Inc. | Texas Instruments Incorporated | | Microchip Technology Incorporated | Wolfspeed, Inc. |
Process and Procedures for Considering and Determining Executive Compensation
At the time that this peer group was approved, the Company’s revenue and earnings before interest, taxes, depreciation and amortization approximated the peer group median and its market cap at about the 25th percentile. In evaluating the competitiveness of the Company’s compensation program, the FW Cook Report utilized data from S&P Capital IQ as it pertained to the most recently reported four quarters, quarter or fiscal year end, as applicable. In August 2025, the HCC Committee, working with FW Cook, approved certain changes to the executive compensation peer group for purposes of 2026 planning. The HCC Committee removed both Advanced Micro Devices, Inc. and Wolfspeed, Inc. and added five new companies (Entegris, Inc., KLA Corporation, Western Digital Corporation, Coherent Corp., and Cirrus Logic, Inc.). At the time this new 17-member peer group was approved, the Company’s revenue and earnings before interest, taxes, depreciation and amortization approximated the peer group median and its market cap at about the 40th percentile. Other Factors. In addition to the market data provided by the independent compensation consultant, the HCC Committee also assesses other factors when making compensation decisions, including, but not limited to •each executive’s individual responsibilities, skills, expertise and value added through performance; •each executive’s prior compensation and LTI award accumulation; •prior contractual commitments with the executives, such as the terms of their respective employment agreements; •for LTI awards, equity availability and usage, the potential voting power dilution to our stockholders and the projected impact on our earnings per share for the relevant years; and •internal pay equity, although the HCC Committee does not have a policy requiring any set levels of internal pay differentiation. The HCC Committee separately reviews CEO performance based on, among other factors considered relevant, Company performance, including revenue growth, earnings growth, gross margin improvement, free cash flow and earnings per share, and further considers downturns or volatility in general economic conditions and other issues facing the Company. Risk Analysis. The HCC Committee considers the potential for unacceptable risk-taking in its compensation design and performs periodic risk assessments with respect to its duties and actions. The HCC Committee believes that the design of our executive compensation program does not unduly incentivize our executives to take actions that may conflict with our long-term best interests. Material risk in our compensation design is mitigated in several ways, including as follows: •Performance-based pay opportunities are designed with goals that are rigorous but attainable without the need to take inappropriate risks and with the goal of driving long-term value to our stockholders. •Our program consists of an appropriate mix of pay elements, with total compensation not overly weighted toward any one compensation component. •The base salaries of our NEOs, although comprising a relatively modest component of aggregate total compensation, nevertheless are adequate to discourage undue risk-taking. •Opportunities under our STI and LTI programs are capped so that the upside potential is not so large as to encourage excessive risk-taking. •Our stock-based incentives vest or are earned over a multi-year period, which provides long-term upside potential, but also requires the executive to bear the economic risk of the award over the vesting period. •We generally use different performance metrics in different programs and awards, which provides balance and lessens the opportunity to take undue risk in meeting a single goal. •The stock components inherent in our LTI program, combined with our stock ownership guidelines, align the interests of our executives with a goal of long-term preservation and appreciation of stockholder value. •Incentive payments and awards are subject to both our Dodd-Frank Policy (in the event of a material restatement of our financial results) as well as a broader conduct-based clawback policy. •Consideration of the compensation design of comparator companies helps avoid unusually high pay opportunities relative to the Company’s peers. •We utilize severance programs with reasonable terms and double-trigger change in control provisions to support retention of our executives.
Other Policies Relating to Executive Compensation
Other Policies Relating to Executive Compensation Hedging / Pledging Transactions. Under our Insider Trading Policy, certain insiders (including our NEOs and directors) are prohibited from engaging in transactions that hedge or offset, or are designed to hedge or offset, any decrease in the market value of Company securities or that otherwise have economic consequences comparable to the same. Our insiders are also prohibited from any pledging or margin transactions with respect to our stock including, but not limited to, holding our securities in a margin account or otherwise pledging them as collateral. We also encourage all other onsemi employees to adhere to these rules. Stock Ownership and Retention Guidelines for Officers. We have adopted robust stock ownership guidelines for our executive officers and non-employee directors. The minimum stock ownership guideline varies based on position, ranging from two times base salary (for anyone directly reporting to the CEO who holds the title of Senior Vice President) to six times base salary for our CEO. For purposes of the guidelines, we count only fully-vested, unrestricted shares of our common stock (not any unvested equity awards). As of the record date, all of our NEOs were in compliance with these guidelines. For additional information regarding these guidelines, please see the sub-section entitled “Director and Officer Stock Ownership and Retention Guidelines” in the Stock Ownership section of this proxy statement. Clawback Policies. We have had robust clawback policies in place since 2014, covering both financial restatements as well as misconduct, as described below. In 2023, in light of developments in SEC rules and Nasdaq listing standards regarding clawback policies, we adopted a standalone Dodd-Frank Clawback Policy (Dodd-Frank Policy) that tracks those requirements. In addition to our Dodd-Frank Policy, our NEOs continue to be subject to our Conduct-based Clawback Policy (Conduct Policy), a version of which has been in place since 2014. The Conduct Policy applies to a broader scope of persons (including all senior vice presidents and others employed by or providing services to onsemi as determined by the HCC Committee), compensation (any incentive-based compensation, including time-based equity awards), and conduct than our Dodd-Frank Policy. Specifically, the Conduct Policy applies to (i) intentional misconduct by a covered person that is materially injurious to onsemi as determined by the Board, including conduct that contributes to an accounting restatement that would have triggered clawback from a covered person under the Dodd-Frank Policy had that person been a Section 16 officer subject to that policy; and (ii) a material breach of a material provision of written agreement between onsemi and the covered person (such as restrictive covenants in an employment agreement). Equity Grant Timing. Under its Equity Grant Guidelines and consistent with long-standing practice, the HCC Committee approves an annual LTI program for senior officers, including each of the NEOs, at its first regular quarterly meeting of each year (typically held in February). As described under “Long-Term Incentives” above, awards granted under our annual LTI program consist of a mix of full-value awards (PBRSUs and RSUs); the Company does not grant stock options. The HCC Committee does not consider the timing of the release of material nonpublic information when determining the timing of LTI awards and the Company does not time the disclosure of material nonpublic information for the purpose of affecting the value of executive compensation.
Accounting and Tax Considerations on Executive Compensation
Accounting and Tax Considerations on Executive Compensation Accounting considerations play a role in the design of our executive compensation program. Accounting rules require us to expense the grant date fair values of our equity awards (that is, the value of our equity awards based on GAAP), which reduces the amount of our reported profits under GAAP. Because of this stock-based expensing and the impact of dilution to our stockholders, we closely monitor the number, the share amounts and the fair values of the equity awards that are granted each year. The HCC Committee also takes into account tax and other accounting consequences of its total compensation program and weighs these factors when setting total compensation and determining the individual elements of an officer’s compensation package.
Summary Compensation Table
Summary Compensation Table
Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | Stock Awards (1) ($) | Non-Equity Incentive Plan Compensation (2) ($) | All Other Compensation (3) ($) | Total ($) | | Hassane El-Khoury President and Chief Executive Officer | 2025 | 1,200,000 | 16,436,467 | — | 42,399 | 17,678,866 | | | 2024 | 1,200,000 | 29,889,669 | — | 41,509 | 31,131,178 | | | 2023 | 1,130,769 | 17,733,531 | 1,060,163 | 41,050 | 19,965,513 | | Thad Trent Executive Vice President and Chief Financial Officer | 2025 | 675,000 | 5,906,457 | 469,631 | 43,911 | 7,094,999 | | | 2024 | 675,000 | 10,706,768 | — | 43,213 | 11,424,981 | | | 2023 | 649,038 | 6,352,386 | 440,736 | 42,832 | 7,484,992 | | Sudhir Gopalswamy Group President, AMG and ISG | 2025 | 600,000 | 4,429,851 | 363,840 | 43,822 | 5,437,513 | | | 2024 | 580,769 | 8,030,122 | — | 33,052 | 8,643,943 | | | 2023 | 470,577 | 2,450,469 | 188,091 | 36,500 | 3,145,637 | | Simon Keeton (4) Group President, PSG | 2025 | 600,000 | 4,429,851 | 264,720 | 36,861 | 5,331,432 | | | 2024 | 600,000 | 8,030,122 | — | 35,952 | 8,666,074 | | | 2023 | 574,038 | 4,764,335 | 290,099 | 37,965 | 5,666,437 | | (1) Amounts in this column represent the aggregate grant date fair value of awards of PBRSUs and RSUs computed in accordance with FASB ASC Topic 718 using the closing price of our common stock on the date of grant, except that the grant date value of the relative TSR component of our PBRSUs is determined by a third-party valuation firm based on probable outcomes. For 2025, each of our NEOs received a grant under our 2025 LTI program (2025 PBRSUs and 2025 RSUs). For the 2025 PBRSUs, this valuation was based upon a 100% attainment, which represents the probable outcomes of the performance conditions for those awards, consistent with the estimate of aggregate compensation cost to be recognized over the service period, determined as of the grant date, excluding the effect of estimated forfeitures. The amounts in this column do not necessarily represent the fair value for expensing purposes or the fair value of awards that were expected to vest as of December 31, 2025. The estimated number of units that is expected to vest is evaluated and adjusted each reporting period, as necessary, in connection with the Company's quarterly and annual financial statements. We further discuss the assumptions we made in the valuation of stock awards in Note 11 of the Notes to Consolidated Financial Statements in the Form 10-K. At maximum, the 2025 PBRSUs would pay out to the applicable NEOs as follows: Mr. El-Khoury: $17,955,500; Mr. Trent: $5,560,230; and each of Messrs. Gopalswamy and Keeton: $4,170,178. | | | | | | | | (2) The amounts in this column reflect annual cash incentives actually earned by the NEO under our STI program. As previously disclosed, Mr. El-Khoury elected to forgo any potential payout under the 2025 STI program in light of the Company’s restructuring efforts although he continued to track, score and report his goals to the Committee and Board consistent with normal practice. Absent this election, Mr. El-Khoury would have been entitled to an STI payout of approximately $1,236,270 based on performance. For more information, please see “Our 2025 Incentive Programs — Short-Term Cash Incentive Program” in the CD&A. | | | | | | |
Summary Compensation Table
| (3) For 2025, amounts in this column consist of the following: | | | | | | | | | Name | Company Contributions Under 401(k) Plan ($) | Executive Group Term Life Insurance Imputed Income ($) | Premiums Paid by the Company for Basic Life Insurance and Accidental D&D Insurance ($) | Car Allowance ($) | Financial Planning Services ($) | Imputed Income for Post-Tax Long-Term Disability Insurance Benefit Payments ($) | Executive Home Cybersecurity Protections* ($) | | Hassane El-Khoury | 14,000 | 810 | 1,380 | 14,400 | 10,000 | 1,150 | 659 | | Thad Trent | 14,000 | 2,322 | 1,380 | 14,400 | 10,000 | 1,150 | 659 | | Sudhir Gopalswamy | 14,000 | 2,233 | 1,380 | 14,400 | 10,000 | 1,150 | 659 | | Simon Keeton | 14,000 | 2,622 | 1,380 | 14,400 | 2,650 | 1,150 | 659 | | * In August 2025, following a comprehensive review of executive security practices, the HCC Committee approved a program that provides certain senior officers, including each of our NEOs, with digital home security and data protection services. These services enable senior officers and their families to maintain strong cybersecurity practices and to minimize exposure to personal data breaches or home network intrusions that could pose risks to the Company. Under current SEC guidance, the cost of these services is reportable as a perquisite to the executive. The estimated annual cost of these services is approximately $7,500 per year for each senior officer. | | | | | | | | | (4) As previously disclosed, Mr. Keeton stepped down from all officer positions on March 9, 2026 and will depart the Company on June 30, 2026. | | | | | | | |
Grants of Plan-Based Awards in 2025
Grants of Plan-Based Awards in 2025
Grants of Plan-Based Awards in 2025
| Name | Grant Date | Type of Award | Estimated Future Payouts Under Non-Equity Incentive Plan Awards (1) | | Estimated Future Payouts Under Equity Incentive Plan Awards (2) | | All Other Stock Awards: Number of Shares of Stock or Units (3) (#) | Grant Date Fair Value of Stock Awards (4) ($) | | | | | Target ($) | Maximum ($) | Target (#) | Maximum (#) | | | | Hassane El-Khoury | 2/21/2025 | Annual Incentive(5) | — | — | | | | | | | 2/21/2025 | RSUs | | | | | 92,970 | 5,025,029 | | | 2/21/2025 | PBRSUs | | | 216,929 | 480,335 | | 11,411,438 | | Thad Trent | 2/21/2025 | Annual Incentive | 843,750 | 1,687,500 | | | | | | | 2/21/2025 | RSUs | | | | | 44,404 | 2,400,036 | | | 2/21/2025 | PBRSUs | | | 66,605 | 147,081 | | 3,506,421 | | Sudhir Gopalswamy | 2/21/2025 | Annual Incentive | 600,000 | 1,200,000 | | | | | | | 2/21/2025 | RSUs | | | | | 33,303 | 1,800,027 | | | 2/21/2025 | PBRSUs | | | 49,954 | 110,311 | | 2,629,824 | | Simon Keeton | 2/21/2025 | Annual Incentive | 600,000 | 1,200,000 | | | | | | | 2/21/2025 | RSUs | | | | | 33,303 | 1,800,027 | | | 2/21/2025 | PBRSUs | | | 49,954 | 110,311 | | 2,629,824 | | (1) Amounts in these columns represent the range of possible payouts under our 2025 STI program. The 2025 STI program does not have a threshold payout and the maximum that may be earned is 200% of target. If we do not achieve minimum performance levels on the metrics in the Corporate Multiplier, no payouts would be earned. For more information on the 2025 STI program, please see “Our 2025 Incentive Programs — Short-Term Cash Incentive Program” in the CD&A. | | | | | | | | | | (2) The amounts shown in these columns represent the number of shares that may be earned under the 2025 PBRSUs, which were granted to our NEOs under our 2025 LTI program and the SIP. The amounts in the “Target” column represent the total number of 2025 PBRSUs that could be earned, assuming that all performance goals are achieved at target. The amounts in the “Maximum” column represent the total number of PBRSUs that could be earned, assuming that all performance goals are achieved at stretch levels and, for each tranche of PBRSUs related to financial goals, that our relative TSR exceeds the stretch level for each of the three TSR performance periods (combined maximum of 221.4% of target for Mr. El-Khoury and 220.8% for the other NEOs). If our performance results for the 2025 LTI Performance Goals do not exceed minimum performance levels, all of the PBRSUs will be forfeited. | | | | | | | | | | (3) This column represents time-based RSU awards made to our NEOs in 2025. | | | | | | | | | | (4) The amounts in this column represent the grant date fair value of each award calculated in accordance with FASB ASC Topic 718. For more details, please see footnote 1 to the SCT. | | | | | | | | | | (5) Prior to the Committee's approval of the 2025 STI program, Mr. El-Khoury waived his right to any payout under it, in light of the Company's restructuring efforts. Had he participated, his target bonus would have been $2,100,000 and his maximum would have been $4,200,000 (unchanged from 2024). | | | | | | | | |
Other Material Factors — Summary Compensation Table and Grants of Plan-Based Awards in 2025 Table
Other Material Factors — Summary Compensation Table and Grants of Plan-Based Awards in 2025 Table For additional information regarding the material terms of each NEO’s employment agreement, see “Employment Agreements” in this proxy statement. For additional information regarding compensation disclosed in the SCT and Grants of Plan-Based Awards in 2025 Table, please refer to the “Our 2025 Incentive Programs” section of the CD&A.
Outstanding Equity Awards at Fiscal Year-End 2025
Outstanding Equity Awards at Fiscal Year-End 2025
Outstanding Equity Awards at Fiscal Year-End 2025
| | | | All Other Stock Awards (1) | | Equity Incentive Plan Awards (2) | | | Name | Grant Date | Type of Award | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested (3) ($) | Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested (3) ($) | | Hassane El-Khoury | 2/21/2023 | RSUs | 28,170 | 1,525,406 | | | | | 2/21/2023 | PBRSUs | 43,898 | 2,377,101 | | | | | 2/21/2024 | RSUs | 57,545 | 3,116,062 | | | | | 2/21/2024 | PBRSUs (4) | 67,091 | 3,632,983 | 28,807 | 1,559,879 | | | 2/21/2024 | PBRSUs (5) | 107,898 | 5,842,677 | 107,898 | 5,842,677 | | | 2/21/2025 | RSUs | 92,970 | 5,034,326 | | | | | 2/21/2025 | PBRSUs (6) | 90,965 | 4,925,741 | 173,534 | 9,396,839 | | Thad Trent | 2/20/2023 | RSUs | 10,091 | 546,428 | | | | | 2/20/2023 | PBRSUs | 15,723 | 851,422 | | | | | 2/21/2024 | RSUs | 20,613 | 1,116,194 | | | | | 2/21/2024 | PBRSUs (4) | 24,032 | 1,301,325 | 10,320 | 558,804 | | | 2/21/2024 | PBRSUs (5) | 38,650 | 2,092,898 | 38,650 | 2,092,898 | | | 2/21/2025 | RSUs | 44,404 | 2,404,477 | | | | | 2/21/2025 | PBRSUs (6) | 31,049 | 1,681,276 | 52,815 | 2,859,932 | | Sudhir Gopalswamy | 2/20/2023 | RSUs | 2,859 | 154,815 | | | | | 2/20/2023 | PBRSUs | 4,455 | 241,230 | | | | | 5/26/2023 | RSUs | 923 | 49,980 | | | | | 5/26/2023 | PBRSUs | 1,438 | 77,857 | | | | | 2/21/2024 | RSUs | 15,460 | 837,159 | | | | | 2/21/2024 | PBRSUs (4) | 18,024 | 976,006 | 7,738 | 418,994 | | | 2/21/2024 | PBRSUs (5) | 28,988 | 1,569,700 | 28,988 | 1,569,700 | | | 2/21/2025 | RSUs | 33,303 | 1,803,357 | | | | | 2/21/2025 | PBRSUs (6) | 23,286 | 1,260,943 | 39,611 | 2,144,961 | | Simon Keeton | 2/20/2023 | RSUs | 7,568 | 409,807 | | | | | 2/20/2023 | PBRSUs | 11,792 | 638,542 | | | | | 2/21/2024 | RSUs | 15,460 | 837,159 | | | | | 2/21/2024 | PBRSUs (4) | 18,024 | 976,006 | 7,738 | 418,994 | | | 2/21/2024 | PBRSUs (5) | 28,988 | 1,569,700 | 28,988 | 1,569,700 | | | 2/21/2025 | RSUs | 33,303 | 1,803,357 | | | | | 2/21/2025 | PBRSUs (6) | 23,286 | 1,260,943 | 39,611 | 2,144,961 | | (1) Represents unvested awards that remain subject to the NEO’s continued employment through the applicable vesting date and all other terms and conditions of the SIP and the award agreement. These include unvested time-based RSUs, which vest in three equal installments on the first three anniversaries of the grant date, and any unvested PBRSUs for which all performance criteria were complete on or before December 31, 2025. | | | | | | | | (2) Represents outstanding PBRSUs that, as of December 31, 2025, remain subject to performance conditions, the NEO’s continued employment through the applicable vesting date, and all other terms and conditions of the SIP and the award agreement. The number of PBRSUs reported in this column assumes maximum performance on the remaining metric (relative TSR over a three-year period), which would increase payouts, on a tranche-by-tranche basis, by 150% of the number of PBRSUs calculated as earned based on one-year financial metrics for the annual grants. However, the actual relative TSR Adjustment may range between a reduction of 50% to the maximum increase of 150%. The amounts in this column do not necessarily represent the number of shares used for expensing purposes or the number of awards that were expected to vest as of December 31, 2025. For the Value Creation grants, the relative TSR is over a five-year period and a 65th percentile or higher relative TSR would increase payouts by 200%.The minimum number of PBRSUs is 100%. The estimated number of units that are expected to vest is evaluated and adjusted each reporting period, as necessary, in connection with the preparation of the Company’s quarterly and annual financial statements. | | | | | | | | (3) The dollar values in this column are calculated by multiplying the closing market price of our common stock on December 31, 2025 ($54.15) by the number of RSUs or PBRSUs shown as held by the NEO. The amounts in this column do not necessarily represent the fair value for expensing purposes or the fair value of awards that were expected to vest as of December 31, 2025. | | | | | | | | (4) For these 2024 PBRSUs, the number shown under “All Other Stock Awards” reflects the total number of PBRSUs earned in the second tranche, including the two-year TSR Adjustment. Our relative TSR performance did not meet the target level, which meant that the number of PBRSUs earned in the second tranche, as originally determined on the basis of 2024 financial metrics, was multiplied by 50% to determine the payout. This second tranche of PBRSUs vested on February 6, 2026. The number shown under “Equity Incentive Plan Awards” reflects the number of PBRSUs in the third tranche, as calculated based on our performance on 2024 financial metrics and assuming the maximum three-year TSR Adjustment. Following the end of the three-year performance period, the HCC Committee will certify the number of PBRSUs earned in that tranche based on our actual relative TSR performance, and those PBRSUs will vest in February 2027 subject to the NEO’s continued employment through that date. | | | | | | |
Outstanding Equity Awards at Fiscal Year-End 2025
| (5) Represents a Value Creation grant of PBRSUs, which will vest in three annual installments over a five year period, beginning on the third anniversary of the date of grant. If our relative TSR for the applicable three-, four- and five-year period meets of exceeds the 65th percentile, the NEO will earn 200% of the target units in that tranche. | | (6) For our 2025 PBRSUs, the number shown under “All Other Stock Awards” reflects one-third of the number of PBRSUs calculated as earned under the LTI Financial Goals (the first tranche), including the one-year TSR Adjustment, plus all PBRSUs calculated as earned under the LTI Strategic Goal (all three tranches), as the performance period ended on December 31, 2025 for each of those components. We achieved a combined 95% on the LTI Financial Goals (92% for Mr. El-Khoury) and 200% on the LTI Strategic Goal. In addition, our one-year relative TSR performance was at the 6th percentile, which meant that the number of PBRSUs in the first tranche calculated as earned under the LTI Financial Goals was multiplied by 50% to determine the payout on that portion of the award, for a combined first tranche payout on all LTI Performance Goals of 73% (69% for Mr. El-Khoury). The remainder of the 2025 PBRSUs (the second and third tranches of the PBRSUs tied to, and calculated as earned under, the LTI Financial Goals) is reported under “Equity Incentive Plan Awards,” assuming maximum TSR Adjustment for each. The first tranche of PBRSUs vested on February 10, 2026, following the HCC Committee’s certification of performance, while the second two tranches, with the PBRSUs tied to LTI Financial Goals to be further adjusted for our actual two- or three-year relative TSR performance, will vest in February of 2027 and 2028, respectively, in each case, subject to the NEO’s continued employment through the vesting date. For more information on these awards, please see the section entitled “Our 2025 Incentive Programs — Long-Term Incentive Program” in our CD&A. |
2025 Stock Vested
2025 Stock Vested
2025 Stock Vested
| | Stock Awards | | | Name | Number of Shares Acquired on Vesting (1) (#) | Value Realized on Vesting (2) ($) | | Hassane El-Khoury | 266,955 | 13,595,360 | | Thad Trent | 94,084 | 4,801,323 | | Sudhir Gopalswamy | 48,403 | 2,425,063 | | Simon Keeton | 62,531 | 3,197,647 | | (1) This column represents the total number of shares underlying RSUs and PBRSUs that vested in 2025. RSUs and PBRSUs were the only types of LTI awards held by our NEOs during 2025. | | | | (2) The value realized equals the number of shares of stock vested multiplied by the market value of one share of our common stock on the date of vesting or, if the vesting date is not a trading date, the immediately preceding trading date. | | |
Potential Payments upon Termination of Employment or Change in Control
Potential Payments upon Termination of Employment or Change in Control In the table below, we provide estimates of the payments that will be made to each of our NEOs upon a termination of employment or change in control of the Company. The table should be read together with the chart above and the following material assumptions.
Material Assumptions
| Potential Payments upon Termination of Employment or a Change in Control | | | | | | | | | NEO | Type of Compensation | No Change in Control | | In Connection with a Change in Control | | Death or Disability | All Other Terminations | | | | Termination without Cause | Resignation for Good Reason | Double Trigger (Termination without Cause or Resignation for Good Reason) | Single Trigger (no Termination) | | | | Mr. El-Khoury | Cash Severance | 2,400,000 | 2,400,000 | 2,400,000 | — | — | — | | | STI Payment | 2,100,000 | 2,100,000 | 4,200,000 | — | 1,060,163 | — | | | Accelerated RSUs/PBRSUs | 16,814,530 | 16,814,530 | 34,227,294 | — | — | — | | | Additional Benefits (1) | 52,304 | 52,304 | 52,304 | — | — | — | | | Total | 21,366,834 | 21,366,834 | 40,879,598 | — | 1,060,163 | — | | Mr. Trent | Cash Severance | 1,012,500 | 1,012,500 | 1,012,500 | — | — | — | | | STI Payment | 843,750 | 843,750 | 1,265,625 | — | 440,736 | — | | | Accelerated RSUs/PBRSUs | 4,425,308 | 4,425,308 | 12,260,481 | — | — | — | | | Additional Benefits (1) | 58,500 | 58,500 | 58,500 | — | — | — | | | Total | 6,340,058 | 6,340,058 | 14,597,106 | — | 440,736 | — | | Mr. Gopalswamy | Cash Severance | 600,000 | 600,000 | 720,000 | — | — | — | | | STI Payment | 600,000 | 600,000 | 720,000 | — | 290,099 | — | | | Accelerated RSUs/PBRSUs | 3,011,013 | 3,011,013 | 8,682,790 | — | — | — | | | Additional Benefits (1) | 52,304 | 52,304 | 52,304 | — | — | — | | | Total | 4,263,317 | 4,263,317 | 10,175,094 | — | 290,099 | — | | Mr. Keeton (2) | Cash Severance | 600,000 | 600,000 | 720,000 | — | — | — | | | STI Payment | 600,000 | 600,000 | 720,000 | — | 290,099 | — | | | Accelerated RSUs/PBRSUs | 3,318,966 | 3,318,966 | 9,195,320 | — | — | — | | | Additional Benefits (1) | 74,091 | 74,091 | 74,091 | — | — | — | | | Total | 4,593,057 | 4,593,057 | 10,709,411 | — | 290,099 | — | | (1) This figure represents the estimated cost of continuation of benefits, based on the NEO’s elections as in effect on December 31, 2025, and the maximum permitted outplacement assistance. | | | | | | | | | (2) As previously disclosed, Mr. Keeton’s employment will end on June 30, 2026. In accordance with the terms of his employment agreement, upon his departure, Mr. Keeton will be eligible to receive the compensation and benefits due to him upon a termination without cause as set out in this table. | | | | | | | |
onsemi 2025 Pay Ratio Disclosure
onsemi 2025 Pay Ratio Disclosure We maintain a global manufacturing network with a significant majority of our employees based outside of the U.S. while many of our peers are fabless companies and/or have a predominance of U.S.-based employees. Given this disparity, our pay ratio disclosure includes both our median employee as determined under SEC rules and a second, supplemental ratio comparing CEO pay to that of our median U.S.-based non-manufacturing employee. For 2025: •the annual total compensation of our median employee (other than Mr. El-Khoury, our CEO) was $14,060; •the annual total compensation of our median U.S.-based non-manufacturing employee (other than Mr. El-Khoury) was $195,164; and •the annual total compensation of Mr. El-Khoury, as reported in our SCT, was $17,678,866. Based on this information, for 2025, the ratios of the annual total compensation of Mr. El-Khoury to the annual total compensation of our median employee and to the annual total compensation of our median U.S.-based non-manufacturing employee were 1,257 to 1 and 91 to 1, respectively. We calculated these pay ratios using the following assumptions and principles: Methodology for Determining our Median Employees. To determine our median employees, we surveyed our global employee population as of December 31, 2025 from our human resources system of record, using cash compensation as the basis for comparison. We define cash compensation as base pay, overtime pay and STI compensation, which includes all commissions and bonuses. We did not annualize the compensation of any employees who did not work for us or our consolidated subsidiaries for the full year. As a significant percentage of our workforce is based outside the U.S., we converted amounts paid in foreign currency to U.S. dollars using our calculated corporate treasury exchange rate for January 2026 but did not make any cost-of-living adjustments. We excluded the value of annual equity awards and certain employee allowances, as those items are neither widely nor uniformly distributed across our employee population and thus do not reasonably reflect the annual compensation of our employees. Identification of Our Median Employees. Using the methodology described above, we determined that the median employee was a full-time technician located in the Philippines and the median U.S. non-manufacturing employee was a full-time engineer located in Detroit, Michigan. Calculating Total Compensation for Our Median Employees. For purposes of determining the pay ratios, we calculated annual total compensation for each of our median employees using the same methodology we use for our NEOs in the SCT. We believe that these pay ratios are reasonable estimates calculated in a manner consistent with SEC rules. Because SEC rules for identifying the median employee and calculating the pay ratio allow companies to adopt a variety of methodologies, to apply certain exclusions and to make reasonable estimates and assumptions that reflect their compensation practices and workforce composition, the pay ratios reported by other companies may not be comparable to ours.
2025 Pay versus Performance
2025 Pay versus Performance The table below compares the pay of our principal executive officer (PEO) and the average pay of all other NEOs to our performance on certain metrics during each of the last five fiscal years (2021, 2022, 2023, 2024 and 2025). In this table, executive pay is presented in two ways: (i) total compensation as disclosed in the SCT for the relevant year and (ii) “compensation actually paid” (CAP) for the same year, calculated as required by SEC rules, which is intended to, among other things, adjust SCT totals to capture actual payouts from equity awards vesting during a given year as well as year-over-year changes in the value of unvested equity awards that are outstanding at the end of that year. Graphs illustrating the relationship between executive pay and each of these metrics are located below the table. For further information regarding our pay-for-performance philosophy and how we align executive compensation with our performance, please see our CD&A.
2025 Pay versus Performance
| Pay versus Performance Table | | | | | | | | | | | PEO | | All Other NEOs (1) | | Value of Initial Fixed $100 Investment Based On (2): | | | CSM (3) | | Year | SCT Total (4) ($) | CAP (5) ($) | Average SCT Total (4) ($) | Average CAP (5) ($) | Company TSR ($) | Peer Group TSR ($) | Net Income ($ millions) | Revenue ($ millions) | | 2025 | 17,678,866 | 5,241,414 | 5,954,648 | 2,651,271 | 165 | 268 | 121 | 5,995 | | 2024 | 31,131,178 | 20,062,649 | 9,578,450 | 6,377,117 | 259 | 269 | 1,573 | 7,082 | | 2023 | 19,965,513 | 35,879,947 | 4,730,325 | 8,918,083 | 343 | 226 | 2,184 | 8,253 | | 2022 | 16,519,702 | 20,249,043 | 3,699,715 | 2,710,546 | 256 | 137 | 1,902 | 8,326 | | 2021 | 12,825,562 | 37,831,495 | 4,014,944 | 10,996,407 | 279 | 213 | 1,010 | 6,740 | | (1) All Other NEOs refers to all named executive officers, other than the PEO, who were designated as such under the SEC’s executive compensation disclosure rules based on their position and the compensation paid to them during the relevant year shown in the chart. All Other NEOs for each year consists of the following officers: for 2025 and 2024, Messrs. Trent, Gopalswamy and Keeton; for 2023, Messrs. Trent, Gopalswamy, Keeton and former officer Ross Jatou; for 2022, Messrs. Trent, Keeton, Jatou, and former officers Robert Tong and Vince Hopkin; and for 2021, Messrs. Trent, Keeton, Jatou and Hopkin, as well as former officers George H. Cave and Bernard Gutmann. | | | | | | | | | | (2) Represents one-, two-, three-, four- and five-year cumulative TSR assuming a $100 investment on December 31, 2020. For purposes of our peer group TSR, we selected the PHLX Semiconductor Sector Index (SOX), which we also use for comparison purposes in the five-year cumulative stock performance graph included in our annual report to stockholders. Our TSR performance relative to a smaller group of peer companies is a key performance metric in determining compensation actually paid to our NEOs, as identified below under “Most Important Performance Metrics.” | | | | | | | | | | (3) For purposes of this chart, we have selected revenue as our company-selected metric (CSM). | | | | | | | | | | (4) The totals in these columns reflect amounts reported in our SCT for the applicable year. | | | | | | | | | | (5) To calculate compensation actually paid (CAP), the corresponding SCT total was adjusted as detailed below as required by SEC rules. For a reconciliation of SCT to CAP, please see the next two tables. | | | | | | | | |
2025 Pay versus Performance
| SCT to CAP Reconciliation — PEOs (A) | | | | | | | | | | | Adjust Value of Current Year’s Equity Grant | | Adjust for Incremental Increase/(Decrease) in Value of All Other Outstanding Equity Grants | | | | | Year | SCT Total ($) | Subtract Grant Date Fair Market Value as reported in SCT ($) | Add Fair Market Value at 12/31 ($) | Unvested Awards as of 12/31 ($) | Vested during Year ($) | Forfeited during Year ($) | Ending CAP ($) | | 2025 | 17,678,866 | (16,436,468) | 12,870,219 | (6,557,447) | (2,313,756) | — | 5,241,414 | | 2024 | 31,131,178 | (29,889,669) | 23,695,160 | (7,142,650) | 2,268,630 | — | 20,062,649 | | 2023 | 19,965,513 | (17,733,531) | 21,898,735 | 3,496,312 | 8,252,918 | — | 35,879,947 | | 2022 | 16,519,702 | (12,557,026) | 18,713,998 | (3,109,730) | 682,099 | — | 20,249,043 | | 2021 | 12,825,562 | (9,413,592) | 20,760,924 | 12,588,427 | 1,070,174 | — | 37,831,495 | | (A) In determining the fair value of unvested equity awards, we applied the same methodology used to determine grant date fair value of equity awards for purposes of SCT reporting but calculated as of the last day of the year, with no material changes to the underlying assumptions for any of the awards since grant date except that probable outcomes may have changed. For more information, please see Note 1 to the SCT. | | | | | | | |
2025 Pay versus Performance
| SCT to CAP Reconciliation — Average of All Other NEOs (A) | | | | | | | | | | | Adjust Value of Current Year’s Equity Grant | | Adjust for Incremental Increase/(Decrease) in Value of All Other Outstanding Equity Grants | | | | | Year | SCT Total ($) | Subtract Grant Date Fair Market Value as reported in SCT ($) | Add Fair Market Value at 12/31 ($) | Unvested Awards as of 12/31 ($) | Vested during Year ($) | Forfeited during Year ($) | Ending CAP ($) | | 2025 | 5,954,648 | (4,922,054) | 4,142,876 | (1,890,252) | (633,947) | — | 2,651,271 | | 2024 | 9,578,450 | (8,922,338) | 7,073,272 | (1,723,380) | 371,113 | — | 6,377,117 | | 2023 | 4,730,325 | (3,921,173) | 4,820,751 | 951,556 | 2,336,624 | — | 8,918,083 | | 2022 | 3,699,715 | (2,542,484) | 2,887,979 | (700,029) | (413) | (634,222) | 2,710,546 | | 2021 | 4,014,944 | (2,955,672) | 6,317,938 | 4,106,036 | 228,638 | (715,477) | 10,996,407 | | (A) In determining the fair value of unvested equity awards, we applied the same methodology used to determine grant date fair value of equity awards for purposes of SCT reporting but calculated as of the last day of the year, with no material changes to the underlying assumptions for any of the awards since grant date except that probable outcomes may have changed. For more information, please see Note 1 to the SCT. | | | | | | | |
How are directors elected if there are more director nominees than open seats on the Board?
How are directors elected if there are more director nominees than open seats on the Board? Under our bylaws, in uncontested elections, directors are elected by a majority of the votes cast, meaning a candidate for director is elected if the votes in favor of his or her election exceed the votes against his or her election. In contested elections where the number of nominees exceeds the number of open seats, directors are elected by a plurality vote, meaning that the director nominees who receive the most votes up to the number of open seats will be elected. In an uncontested election, any nominee for director who fails to receive a majority of the votes cast in such election will be required to promptly tender his or her resignation to the Board. The GS Committee, or such other committee designated by the Board for this purpose, will recommend to the Board whether to accept or reject the tendered resignation. The Board will review the GS Committee’s recommendation, decide whether to accept or reject such resignation or whether other action should be taken and publicly disclose its decision within 90 days from the date of the certification of the election results (typically on the date of the annual meeting of stockholders). Any director who tenders his or her resignation will not participate in the committee’s recommendation or the Board action regarding whether to accept or reject the tendered resignation. Any vacancies on the Board may be filled by a majority of the directors then in office or those directors, by majority vote, may choose to decrease the number of board seats. Each director elected in this manner will hold office until the next annual meeting and until his or her successor is elected and duly qualified.