DEF 14A of D-Wave Quantum Inc.
Filed Apr 22, 2025 · FY20240001140361-25-014910
Proposal 1: Election of Directors
Proposal 1: Election of Directors At the Annual Meeting, three (3) Class III directors are to be elected to hold office until the Annual Meeting of Stockholders to be held in 2028 and until each such director’s respective successor is elected and qualified or until each such director’s earlier death, resignation or removal. We currently have seven (7) directors on our Board of Directors. Our current Class III Directors are Steven M. West, Kirstjen Nielsen, and Roger Biscay. The Board of Directors has nominated each of the foregoing director candidates to serve as Class III directors until the 2028 Annual Meeting. The proposal regarding the election of directors requires the approval of a plurality of the votes of the shares present at the virtual Annual Meeting or represented by proxy at the Annual Meeting and entitled to vote. This means that the three (3) nominees receiving the highest number of affirmative “FOR” votes will be elected as Class III directors. Votes withheld and broker non-votes are not considered to be votes cast and, accordingly, will have no effect on the outcome of the vote on this proposal. In accordance with our Charter and Amended and Restated Bylaws, our Board of Directors is divided into three classes with staggered three-year terms. At each annual meeting of stockholders, the successors to the directors whose terms will then expire will be elected to serve from the time of election and qualification until the third annual meeting following their election. The current class structure is as follows: Class I, whose current term will expire at the 2026 Annual Meeting of Stockholders; Class II, whose term will expire at the 2027 Annual Meeting of Stockholders; and Class III, whose term will expire at the 2025 Annual Meeting of Stockholders. The current Class I Directors are Alan Baratz and Sharon Holt; the current Class II Directors are John DiLullo and Rohit Ghai; and the current Class III Directors are Steven M. West, Kirstjen Nielsen and Roger Biscay. Upon the recommendation of our Chief Executive Officer and Nominating and Governance Committee, our Board of Directors has nominated the three persons listed below to stand for a term expiring at the 2028 Annual Meeting and until each such director’s respective successor is elected and qualified or until each such director’s earlier death, resignation or removal. Each nominee listed below is currently serving as a director and is willing and able to serve as a director. Kirstjen Nielsen, one of our current directors, was recommended by a member of the Company’s senior management team. Our Charter and Amended and Restated Bylaws provide that, subject to the rights of holders of any series of preferred stock, the authorized number of directors may be changed from time to time by the Board of Directors. Any additional directorships resulting from an increase in the number of directors will be distributed among the three classes so that the number of directors in each class is divided as nearly equal as reasonably possible. If you submit a proxy but do not indicate any voting instructions, the persons named as proxies will vote the Common Shares represented thereby for the election as directors of the persons whose names and biographies appear below. In the event that Steven M. West, Kirstjen Nielsen or Roger Biscay should become unable to serve, or for good cause will not serve, as a director, it is intended that votes will be cast for a substitute nominee designated by the Board of Directors or the Board of Directors may elect to reduce its size. The Board of Directors has no reason to believe that any of the director nominees will be unable to serve if elected. Each of the director nominees has consented to being named in this proxy statement and to serve if elected.
Class I Directors (terms to expire at the 2026 Annual Meeting)
Class I Directors (terms to expire at the 2026 Annual Meeting) The current members of the Board of Directors who are Class I Directors are as follows:
Class I Directors (terms to expire at the 2026 Annual Meeting)
| Name | Age(*) | Served as a Director Since | Position with D-Wave Quantum | | Alan Baratz | 70 | January 14, 2020 | President, Chief Executive Officer and Director | | Sharon Holt | 60 | November 22, 2024 | Director |
Class I Directors (terms to expire at the 2026 Annual Meeting)
| (*) | Age as of April 11, 2025. |
Alan Baratz
Alan Baratz Dr. Baratz became the CEO of D-Wave Systems in January 2020 and the Company in August 2022. Previously, as Executive Vice President of R&D and Chief Product Officer of D-Wave Systems from August 2018 to December 2019, he drove the development, delivery, and support of all of the company’s products, technologies, and applications. Dr. Baratz also acted as Senior Vice President of Software & Applications of D-Wave Systems from August 2017 to August 2018. He has over 25 years of experience in product development and bringing new products to market at leading technology companies and software startups. As the first president of JavaSoft at Sun Microsystems, Dr. Baratz oversaw the growth and adoption of the Java platform from its infancy to a robust platform supporting mission-critical applications in nearly 80 percent of Fortune 1000 companies. He has also held executive positions at Symphony, Avaya, Cisco, and IBM. He served as CEO and president of Versata, Zaplet, and NeoPath Networks, and as a managing director at Warburg Pincus LLC. Dr. Baratz also served on the board of Versata from 2003 to 2005 and the board of TRW Inc. in 2002. Dr. Baratz holds a doctorate in computer science from the Massachusetts Institute of Technology. We believe Dr. Baratz is qualified to serve on our Board of Directors because of his extensive knowledge of the Company, past public company board experience, and significant experience in product development and, specifically, bringing new products to market.
Sharon Holt
Sharon Holt Ms. Holt is the co-founder and has served as a principal at Fraser Stuart Ventures, LLC, a private investment and advisory firm since February 2016. Since June 2019, she has served as a director on the board of directors of Infinera Corporation (Nasdaq: INFN), an industry-leading supplier of intelligent transport network solutions (“Infinera”). Ms. Holt also serves as the chair of Infinera’s compensation committee and previously served as the chair of Infinera’s nominating and governance committee. From August 2016 to May 2021, Ms. Holt served on the board of directors of Immersion Corporation (Nasdaq: IMMR), a developer of haptics technology for cellphones and other devices, having served as the chairman of the board, lead independent director, the chair of the nominating and governance committee, the chair of the compensation committee and a member of the audit committee. Since 2012, she has served as an advisor to several technology companies. From 2004 to 2012, Ms. Holt was a senior executive at Rambus Inc., a leading technology development and licensing company, where she served as Senior Vice President of Sales, Licensing and Marketing and Senior Vice President and General Manager of the Semiconductor Business Group. From 1999 to 2004, Ms. Holt served as an executive at Agilent Technologies in the Semiconductor Products Group (now Broadcom), where her last position was Vice President & General Manager of Americas Field Operations, overseeing sales and technical support operations for the semiconductor business, including ASICs, ASSPs, optical and wireless ICs. Prior to that, she ran sales operations focused on Agilent’s largest global customers. From 1986 to 1999, Ms. Holt held various positions at HP in Applications Engineering, Sales, and Distribution Channel Management for the Semiconductor Products Group. Ms. Holt received a BS in Electrical Engineering from Virginia Polytechnic Institute and State University (Virginia Tech). We believe Ms. Holt is qualified to serve on our Board of Directors because of her significant investment, technology, operational, go-to-market and marketing experience, and service as a public company board member.
Class II Directors (terms to expire at the 2027 Annual Meeting)
Class II Directors (terms to expire at the 2027 Annual Meeting) The current members of the Board of Directors who are Class II Directors are as follows:
Class II Directors (terms to expire at the 2027 Annual Meeting)
| Name | Age(*) | Served as a Director Since | Position with D- Wave Quantum | | John DiLullo | 58 | October 28, 2024 | Director | | Rohit Ghai | 55 | October 28, 2024 | Director |
Class II Directors (terms to expire at the 2027 Annual Meeting)
| (*) | Age as of April 11, 2025. |
Compensation Committee
| • | administering the equity incentive plans and other benefit programs; |
Compensation Committee
| • | periodically reviewing, adopting, amending and terminating all incentive compensation and equity plans, bonus plans, change-of-control protections and any other compensatory arrangements for the executive officers and other senior management; |
Compensation Committee
| • | retaining or terminating compensation consultants, independent legal counsel or any other advisors, consultants or professionals (collectively, the “Compensation Advisors”) to assist the Compensation Committee in its responsibilities and is directly responsible for overseeing the work of such Compensation Advisors. |
Nominating and Governance Committee
| • | with the assistance of an independent compensation consultant, periodically reviewing and recommending to the Board of Directors for approval the compensation to be paid to non-executive directors, including the amount and type of compensation; |
EXECUTIVE AND DIRECTOR COMPENSATION
EXECUTIVE AND DIRECTOR COMPENSATION For the purposes of this “Executive and Director Compensation” section “D-Wave Systems” refers to D-Wave Systems Inc., “D-Wave Quantum” and the “Company” refer to D-Wave Quantum Inc., and “D-Wave,” “us”, “we” and “our”, as the context requires, refers to either D-Wave Quantum Inc. or D-Wave Systems Inc. This section discusses the material components of the executive compensation program for our executive officers who are named in the “Summary Compensation Table” below. In 2024, our “named executive officers” (“NEOs”) and their positions were as follows:
EXECUTIVE AND DIRECTOR COMPENSATION
| • | Alan E. Baratz, President, Chief Financial Officer and Director; |
EXECUTIVE AND DIRECTOR COMPENSATION
| • | John M. Markovich, Chief Financial Officer; and |
EXECUTIVE AND DIRECTOR COMPENSATION
| • | Diane Nguyen, General Counsel. |
EXECUTIVE AND DIRECTOR COMPENSATION
Policies and Practices Related to the Grant of Certain Equity Awards. We do not grant equity awards in anticipation of the release of material nonpublic information, and we do not time the release of material nonpublic information based on equity award grant dates or for the purpose of affecting the value of executive compensation. While we do not have a formal policy with respect to the timing of awards of stock options, stock appreciation rights, or similar option-like instruments to our NEOs, historically, including during fiscal 2024, our Compensation Committee has not granted such awards.
EXECUTIVE AND DIRECTOR COMPENSATION
| Name | Grant date | Number of securities underlying the award | Exercise price of the award ($/Sh) | Grant date fair value of the award(1) | Percentage change in the closing market price of the securities underlying the award between the trading day ending immediately prior to the disclosure of material nonpublic information and the trading day beginning immediately following the disclosure of material nonpublic information | | (a) | (b) | (c) | (d) | (e) | (f) | | Alan E. Baratz | — | — | — | — | — | | John M. Markovich | — | — | — | — | — | | Diane Nguyen | 3/27/2024 | 100,000 | $2.10 | $1.62 | (2.5)% |
EXECUTIVE AND DIRECTOR COMPENSATION
| (1) The amounts reported in this column reflect the grant date fair value of restricted share unit awards made under the 2022 Plan to the NEOs listed in this table, computed in accordance with FASB ASC Topic 718 for stock-based compensation transactions. Assumptions used in the calculation of these amounts are included in Note 11 to our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024. |
Summary Compensation Table
Summary Compensation Table The following table presents information regarding the compensation of our NEOs for the fiscal years ended December 31, 2024 and 2023:
Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | Stock Awards ($)(1) | Option Awards ($)(2) | Non-Equity Incentive Plan Compensation ($)(3) | All Other Compensation ($) | Total ($) | | Alan E. Baratz President & Chief Executive Officer, Director | 2024 | 575,000 | 630,000 | — | 517,500 | — | 1,722,500 | | | 2023 | 575,000 | 153,900 | — | 316,250 | — | 1,045,150 | | John M. Markovich Chief Financial Officer | 2024 | 430,000 | 315,000 | — | 283,360 | — | 1,028,360 | | | 2023 | 400,000 | 102,600 | — | 179,200 | — | 681,800 | | Diane Nguyen General Counsel | 2024 | 310,000 | 378,000 | 162,000 | 151,800 | — | 1,001,800 | | | 2023 | 255,000 | 43,790 | — | 86,400 | — | 385,190 |
Summary Compensation Table
| (1) The amounts reported in this column reflect the grant date fair value of restricted share unit awards made under the 2022 Plan to the NEOs listed in this table, computed in accordance with FASB ASC Topic 718 for stock-based compensation transactions. Assumptions used in the calculation of these amounts are included in Note 11 to our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024. |
Summary Compensation Table
| (2) The amounts reported in this column reflect the grant date fair value of stock option awards made under the 2022 Plan and 2020 Plan to the NEOs, computed in accordance with ASC 718 for stock-based compensation transactions. Assumptions used in the calculation of these amounts are included in Note 11 to our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024. These amounts do not reflect the actual economic value that will be realized by the NEO upon the vesting of the stock options, the exercise of the stock options, or the sale of the Common Shares underlying such stock options. |
Summary Compensation Table
| (3) For 2024 and 2023, the amounts reported in this column reflect annual cash incentive earned by each NEO determined by the Company’s Compensation Committee. |
Outstanding Equity Awards at 2024 Fiscal Year-End
Outstanding Equity Awards at 2024 Fiscal Year-End The following table presents information regarding outstanding equity awards held by our NEOs as of December 31, 2024. All awards were granted pursuant to the 2020 Plan or the 2022 Plan. See the section titled “—Equity Compensation Plan Information – 2020 Plan and 2022 Plan” below for additional information.
Outstanding Equity Awards at 2024 Fiscal Year-End
| | Option Awards | | | | Stock Awards | | | Name | Number of Securities Underlying Unexercised Options (#) Exercisable(1) | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($)(7) | | Alan E. Baratz | 2,920,208 | — | 0.91 | 5/5/2030 | 843,750(4) | 7,087,500 | | | 213,232 | — | 0.8455 | 1/10/2034 | | | | John M. Markovich | 1,251,170 | 250,216(1) | 0.92 | 8/20/2031 | 481,250(5) | 4,042,500 | | | 120,826 | — | 0.8455 | 1/10/2034 | | | | Diane Nguyen | 44,260 | — | 0.91 | 5/5/2030 | 237,171(6) | 1,992,236 | | | 9,118 | — | 0.91 | 11/17/2030 | | | | | 45,595 | 7,784(2) | 0.92 | 8/20/2031 | | | | | 58,255 | — | 0.8455 | 1/10/2034 | | | | | 39,583 | 60,417(3) | 2.10 | 3/27/2034 | | |
Outstanding Equity Awards at 2024 Fiscal Year-End
| (1) The remaining portion of the option vests in equal monthly installments on the 20th of each month through August 20, 2025. |
Outstanding Equity Awards at 2024 Fiscal Year-End
| (2) The remaining portion of the option vests in equal monthly installments on the 16th of each month through July 16, 2025. |
Outstanding Equity Awards at 2024 Fiscal Year-End
| (3) The remaining portion of the option vests in equal monthly installments on the 1st of each month through May 1, 2027. |
Outstanding Equity Awards at 2024 Fiscal Year-End
| (4) Of the 843,750 unvested restricted share units, 375,000 vest on October 27, 2025 and 168,750 vest in equal quarterly installments ending on March 27, 2027. Of the remaining 300,000 restricted share units, 25% vest on March 27, 2025, with the remainder vesting in equal quarterly installments ending on March 27, 2028. |
Outstanding Equity Awards at 2024 Fiscal Year-End
| (5) Of the 481,250 unvested restricted share units, 218,750 vest on October 27, 2025 and 112,500 vest in equal quarterly installments ending on March 27, 2027. Of the remaining 150,000 restricted share units, 25% vest on March 27, 2025, with the remainder vesting in equal quarterly installments ending on March 27, 2028. |
Outstanding Equity Awards at 2024 Fiscal Year-End
| (6) Of the 237,171 unvested restricted share units, 46,656 vest on October 13, 2025 and 48,015 vest in equal quarterly installments ending on March 27, 2027. A further 62,500 restricted share units vest in equal quarterly installments ending on May 1, 2027 Of the remaining 80,000 restricted share units, 25% vest on March 27, 2025, with the remainder vesting in equal quarterly installments ending on March 27, 2028. |
Outstanding Equity Awards at 2024 Fiscal Year-End
| (7) The market value of these shares is based on the closing price of Commons Shares on December 31, 2024 ($8.40 per share). |
Non-Employee Director Compensation
Non-Employee Director Compensation The annual director compensation is determined by the Board of Directors of the Company at its first meeting following each annual meeting of stockholders and covers the period starting from such annual meeting and ending at the next annual meeting. Unless a director is restricted from receiving any director compensation, our director compensation policy provides that each of our non-employee directors receives an annual cash retainer of $35,000, with our Chair of the Board of Directors, and the chairs of our Audit Committee, Compensation Committee, Nominating & Governance Committee and Cybersecurity Committee each also receiving an additional annual cash retainer of $30,000, $20,000, $15,000 and $15,000, respectively. In addition, each member of the Audit Committee, Compensation Committee, Nominating & Governance Committee and Cybersecurity Committee, other than the chair of each such committee, receives an additional annual cash retainer of $8,000. We do not pay any meeting attendance fees. The annual cash retainer is being paid to each eligible director in four equal, quarterly installments. Each of our eligible non-employee directors also receives an annual equity-based grant of RSUs valued at $140,000 (computed based on a trailing average share price), which generally vests annually. The value of grants to new directors are prorated according to the number of days served during their initial annual term. New eligible non-employee directors also receive an initial grant of 7,500 RSUs, which will vest on May 31, 2025. During 2024, D-Wave granted equity to its eligible non-employee directors as described below, such grants vesting on May 31, 2025. New eligible non-employee directors also receive an initial grant of 7,500 RSUs, which will vest on May 31, 2025. Vesting is subject to continued service on the Board of Directors through the relevant vesting date. Commencing with compensation earned in respect of service following our Annual Meeting, our eligible non-employee directors will be permitted to elect to receive RSUs in lieu of cash compensation. The following table sets forth information concerning the compensation of D-Wave’s non-employee directors for the year ended December 31, 2024, with respect to the company’s compensation plans, under which equity securities are authorized for issuance.
Non-Employee Director Compensation
| Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1) | All Other Compensation ($) | Total ($) | | Kirstjen Nielsen(2) | 43,420 | 187,676 | — | 231,096 | | Steven M. West | 54,750 | 127,951 | — | 182,701 | | Roger Biscay | 41,250 | 127,951 | — | 169,201 | | John D. DiLullo | — | 90,516 | — | 90,516 | | Rohit Ghai | — | 90,516 | — | 90,516 | | Sharon Holt | — | 178,961 | — | 178,961 | | Ziv Ehrenfeld(3) | — | — | — | — | | Phillip Adam Smalley III(3) | — | — | — | — | | Emil Michael(3) | 39,000 | 127,951 | — | 166,951 | | Amy Cappellanti-Wolf(3) | 37,500 | 127,951 | — | 165,451 |
Non-Employee Director Compensation
| (1) RSUs awarded and vest 100% on May 31, 2025. Grant date fair value calculated in accordance with FASB ASC 718. |
Non-Employee Director Compensation
| (2) Stock awards include $59,725 arising from a prorated award pertaining to the previous annual term. |
Non-Employee Director Compensation
| (3) Resigned prior to December 31, 2024, thereby forfeiting unvested stock awards. |
Non-Employee Director Compensation
The table below shows for each non-employee director who was serving, and held outstanding equity awards, as of December 31, 2024, the aggregate number of equity awards held by each such non-employee director as of such date.
Non-Employee Director Compensation
| Name | Shares Underlying Options Outstanding at Fiscal Year End (#) | Stock Awards Outstanding at Fiscal Year End (#)(1) | | Kirstjen Nielsen | — | 106,626 | | Steven M. West | 311,973 | 106,626 | | Roger Biscay | — | 106,626 | | John D. DiLullo | — | 87,035 | | Rohit Ghai | — | 87,035 | | Sharon Holt | — | 61,079 | | Ziv Ehrenfeld(2) | — | — | | Philip Adam Smalley III(2) | — | — | | Amy Cappellanti-Wolf(2) | — | — | | Emil Michael(2) | — | — |
Non-Employee Director Compensation
| (1) RSUs awarded and vest 100% on May 31, 2025. |
Non-Employee Director Compensation
| (2) Resigned prior to December 31, 2024, thereby forfeiting unvested stock awards. |
Non-Employee Director Compensation
The Board of Directors and Nominating and Governance Committee expect to review director compensation periodically to ensure that director compensation remains competitive such that D-Wave is able to recruit and retain qualified directors.
Executive Officer and Director Compensation
Executive Officer and Director Compensation Please see the section titled “Executive and Director Compensation” for information regarding the compensation of our directors and executive officers.