DEF 14A of IonQ, Inc.
Filed Apr 25, 2024 · FY20230001193125-24-114115
Nominees for Director
Nominees for Director Peter Chapman has served as a member of our board of directors and President and Chief Executive Officer since the closing of the business combination in September 2021. Mr. Chapman previously served as legacy IonQ’s President and Chief Executive Officer and a member of its board of directors since May 2019. From September 2014 to May 2019, Mr. Chapman served as a Director of Engineering for Amazon Prime at Amazon.com, Inc. prior to joining IonQ. Before that, Mr. Chapman was the President at Media Arc, Inc. We believe Mr. Chapman is qualified to serve as a member of our board of directors because of his prior leadership and officer positions at technology and software companies. William Scannell has served as a member of our board of directors since February 2024. Since September 2016, Mr. Scannell has served as President, Global Sales & Customer Operations at Dell Technologies Inc., a publicly traded company. Prior to this role, Mr. Scannell oversaw Global Enterprise Sales & Customer Operations at Dell Technologies, Inc. and Global Sales at EMC Corporation (acquired by Dell Technologies, Inc. in 2016). Mr. Scannell began his career as a Sales Representative for EMC Corporation in 1986, and has served in several other roles in addition to those mentioned above. Mr. Scannell holds a Bachelor of Science degree in business management from Northeastern University. We believe Mr. Scannell is qualified to serve as a member of our board of directors because of his extensive and varied experience in all aspects of software and hardware company operations.
Directors Continuing in Office Until the 2025 Annual Meeting of Stockholders
Directors Continuing in Office Until the 2025 Annual Meeting of Stockholders Niccolo de Masi has served as a member of our board of directors since the closing of the business combination in September 2021 and was the Chief Executive Officer and a member of the board of directors of our predecessor, dMY Technology Group, Inc. III, since September 2020. Mr. de Masi has served as a director of Planet Labs PBC, a publicly traded earth imaging company, since December 2021 and as a director and audit committee member of Genius Sports Limited, a publicly traded sports data and technology company, since April 2021. Mr. de Masi has served as a director of dMY Technology Group, Inc. VI and dMY Squared Technology Group, Inc., each a publicly traded company, since October 2021 and October 2022, respectively. From January 2020 to December 2020, Mr. de Masi served as Chief Executive Officer of dMY Technology Group, Inc. and has served as a director of Rush Street Interactive, Inc., a publicly traded online casino company, since December 2020, following its business combination with dMY Technology Group, Inc. From January 2010 to April 2021, Mr. de Masi was a member of the board of directors of Glu Mobile Inc., a publicly traded mobile gaming company. From February 2019 to March 2020, Mr. de Masi was the Chief Innovation Officer at Resideo Technologies, Inc., a publicly traded security solutions company. From October 2018 to January 2020, he served as a member of Resideo Technologies, Inc.’s board of directors and from February 2019 until January 2020 he served as its President of Products and Solutions. From November 2016 until October 2018, Mr. de Masi served as the President of Essential Products, Inc. Since November 2015, Mr. de Masi has served on the Leadership Council of the UCLA Grand Challenge. Mr. de Masi received a B.A. and an MSci. in physics from Cambridge University. We believe Mr. de Masi is qualified to serve as a member of our board of directors because of his breadth of experience as both an officer and member of the board of directors at a variety of publicly traded technology companies. Inder M. Singh has served as a member of our board of directors since December 2021. Mr. Singh has served as a director of John Wiley and Sons, Inc., a publicly traded publishing company since December 2021. From April 2019 to December 2022, Mr. Singh served as Executive Vice President and Chief Financial Officer of Arm Limited, a British semiconductor and software design company, where he led the global finance organization as well as corporate IT operations, procurement and enterprise security teams. From November 2016 to April 2019, Mr. Singh served as Senior Vice President and Chief Financial Officer, and from March 2016 to November 2016, as Chief Strategy and Marketing Officer, of Unisys Corp., a publicly traded company. Prior to that, Mr. Singh was a Managing Director at SunTrust Bank’s equities unit, and a Senior Vice President in finance at Comcast Corporation. Mr. Singh is currently a member of the board of directors of Affinity Federal Credit Union, a U.S. financial services firm. Mr. Singh has also advised startups as a member of Columbia University’s Entrepreneurship Advisory Board, and participates as a project advisor for the U.S. Department of Homeland Security on national security and critical infrastructure issues. Mr. Singh received an M.B.A. in finance from New York University and holds M.S. and B.S. degrees in engineering from Columbia University. We believe Mr. Singh is qualified to serve as a member of our board of directors because of his finance and corporate management roles within various organizations and his general involvement in the technology and infrastructure industry. Wendy Thomas has served as a member of our board of directors since December 2022. Since September 2021, Ms. Thomas has served as Chief Executive Officer of SecureWorks Corp., a publicly traded company. Prior to this, Ms. Thomas served in various other positions at SecureWorks, including as President from September 2021 through February 2023 and President, Customer Success from April 2020 to June 2021, Chief Product Officer from June 2019 to April 2020, Senior Vice President, Business and Product Strategy from March 2018 to June 2019, Vice President, Strategic and Financial Planning from March 2017 to March 2018 and Vice President, Financial Planning and Analysis from July 2015 to March 2017. Ms. Thomas received an M.B.A. from the Darla Moore School of Business at the University of South Carolina and holds a B.A. in Economics and Foreign Affairs from the University of Virginia. We believe Ms. Thomas is qualified to serve as a member of our board of directors because of her extensive and varied experience in multiple senior executive roles at a publicly traded technology company.
Directors Continuing in Office Until the 2026 Annual Meeting of Stockholders
Directors Continuing in Office Until the 2026 Annual Meeting of Stockholders Kathryn Chou has served as a member of our board of directors since July 2022. Since January 2022, Ms. Chou has served as Senior Vice President, SaaS Engineering, of Nutanix, Inc., a publicly traded company, where she along with her team is responsible for building secure and scalable SaaS applications and systems across the entire customer life cycle. From June 2020 to September 2022, Ms. Chou served as Senior Vice President, Worldwide Sales Strategy and Operations, from March 2020 to June 2020, as Vice President, Customer Success Operations and Intelligence and from September 2016 to March 2020 as Vice President, Research and Development, Operations and Central Services, of VMware, Inc., a publicly traded company. Ms. Chou has also served in various non-profit organizations throughout her career. Ms. Chou received an M.B.A. from Harvard Business School and holds M.S. and B.S. degrees in manufacturing systems engineering and mechanical engineering, respectively, from Stanford University. We believe Ms. Chou is qualified to serve as a member of our board of directors because of her extensive and varied experience as a senior executive at multiple publicly traded technology and software companies. Harry You has served as a member of our board of directors since the closing of the business combination in September 2021, and was the Chief Financial Officer and chair of the board of directors of our predecessor, dMY Technology Group, Inc. III, since inception. Mr. You has served as the chair of the board of directors and co-CEO of dMY Technology Group Squared since September 2022. Since October 2021, Mr. You has served as chair of dMY Technology Group VI. Since March 2021, Mr. You has served on the board of directors of Coupang, Inc, a south Korean publicly traded e-commerce company. Since January 2019, Mr. You has served as a member of the board of directors of Broadcom Inc., a publicly traded semiconductor and software company. In September 2016, Mr. You founded GTY Technology Holdings, Inc. (“GTY”), a publicly traded technology company. From September 2016 until February 2019, Mr. You served as GTY’s President, Chief Financial Officer and director when GTY consummated its initial business combination. From February 2019 to May 2019, he served as GTY’s President and from February 2019 through August 2019 he served as its Chief Financial Officer. From May 2019 to July 2022, he served as GTY’s vice chair of the board of directors until its sale in July 2022. In May 2019, Mr. You also served as GTY’s President. From February 2008 to September 2016, Mr. You served as the Executive Vice President of EMC Corporation (formerly NYSE: EMC) in the office of the chair. Earlier in his career, Mr. You was Chief Executive Officer at BearingPoint (formerly KPMG Consulting, Inc.) as well as Chief Financial Officer of Oracle and Accenture. Mr. You also previously spent 14 years on Wall Street, including serving as a Managing Director in the Investment Banking Division of Morgan Stanley. Since August 2016, Mr. You has been a trustee of the U.S. Olympic Committee Foundation. Mr. You received a B.A. in economics from Harvard College and an M.A. in economics from Yale University. We believe Mr. You is qualified to serve as a member of our board of directors because of his extensive and varied experience as both a senior executive and member of the board of directors at a variety of publicly traded technology and software companies. Robert Cardillo has served as a member of our board of directors since February 2024. Since April 2021, Mr. Cardillo has served as Chief Strategist at Planet Labs PBC, a publicly traded company. From October 2014 to February 2019, Mr. Cardillo was the sixth Director of the National Geospatial-Intelligence Agency. Mr. Cardillo is the Chairman of the Board of Planet Federal, an Outside Director at Seerist Federal and an Independent Director on the board of directors of SynthetAIc. Mr. Cardillo served as a member of the board of directors of AGI and Enview, each private companies which were acquired by public companies—AGI by ANSER (2020) and Enview by Matterport (2022). Mr. Cardillo earned a Bachelor of Arts in Government from Cornell University in 1983 and a Master of Arts in National Security Studies from Georgetown University in 1988. In 2019, Mr. Cardillo received an honorary Doctorate of Humane Letters from Saint Louis University. We believe Mr. Cardillo is qualified to serve as a member of our board of directors because of his extensive experience in the U.S. government and with private and public companies.
Directors Not Standing for Re-Election
Directors Not Standing for Re-Election The current term of each of Craig Barratt and Jungsang Kim, each a member of our board of directors, will expire at the Annual Meeting. Neither Dr. Barratt nor Dr. Kim will stand for re-election to our board of directors at the Annual Meeting. Our board of directors thanks each of Dr. Barratt and Dr. Kim for their distinguished service as directors of the Company. As a result of Drs. Barratt and Kim not standing for re-election to our board of directors, to avoid vacancies existing on our board of directors following the Annual Meeting, consistent with our amended and restated bylaws, our board of directors has unanimously adopted a resolution to reduce the size of our board of directors from ten to eight members, effective upon the conclusion of the Annual Meeting. Craig Barratt has served as a member of our board of directors and Chair of the Board since the closing of the business combination in September 2021. Dr. Barratt served as a member of legacy IonQ’s board of directors since January 2021. Until May 2020, Dr. Barratt served as Senior Vice President and General Manager of the Connectivity Group of Intel Corporation, a semiconductor company, since its acquisition of Barefoot Networks, Inc., a computer networking company, in July 2019, where he previously served as President and Chief Executive Officer since April 2017. From June 2013 to January 2017, Dr. Barratt held several different roles at Google, including Senior Vice President, Access and Energy and Advisor. Dr. Barratt previously served as President of Qualcomm Atheros, the networking and connectivity subsidiary of Qualcomm Inc., and as President, Chief Executive Officer and a director of Atheros Communications, Inc., a fabless semiconductor company, until its acquisition by Qualcomm. Dr. Barratt has also served as a member of the board of directors of Intuitive Surgical, Inc., a robotic-assisted surgery company, since April 2011 and as chair of the board of directors since April 2020. Dr. Barratt received a B.E. in electrical engineering and a B.S. in pure mathematics and physics from the University of Sydney, Australia as well as an M.S. and Ph.D. in electrical engineering from Stanford University. We believe Dr. Barratt is qualified to serve as a member of our Board because of his senior leadership roles at industry leading companies in the technology sector. Jungsang Kim has served as a member of our board of directors since the closing of the business combination in September 2021. Dr. Kim has served as our Scientific Advisor since April 2024. Previously, Dr. Kim served as our Chief Technology Officer from September 2021 to March 2024. Dr. Kim is the co-founder of legacy IonQ and served as a member of its board of directors from September 2015 to September 2021. Dr. Kim served as legacy IonQ’s President and Chief Executive Officer from September 2015 to September 2016, as legacy IonQ’s Chief Strategy Officer from September 2016 to April 2020, and as legacy IonQ’s Chief Technology Officer from May 2020 to September 2021. Dr. Kim has served as assistant/associate/full professor in the Department of Electrical and Computer Engineering, Department of Physics and Department of Computer Science at Duke University since June 2004. From August 2006 to February 2020, Dr. Kim was also the Founder and President and Chief Executive Officer of Applied Quantum Technologies, Inc. Dr. Kim received a B.S. in physics from Seoul National University and a Ph.D. in physics from Stanford University. We believe Dr. Kim is well qualified to serve as a member of our board of directors because of his extensive research in electrical and computer engineering and quantum mechanics.
Compensation Committee
| • | making recommendations to our board of directors regarding non-employee director compensation. |
Considerations in Evaluating Director Nominees
Considerations in Evaluating Director Nominees Our nominating and corporate governance committee uses a variety of methods for identifying and evaluating potential director nominees. In its evaluation of director candidates, including the current directors eligible for re-election, our nominating and corporate governance committee will consider the current size and composition of our board of directors and the needs of our board of directors and the respective committees of our board of directors and other director qualifications. While our board of directors has not established minimum qualifications for members of our board of directors, some of the factors that our nominating and corporate governance committee considers in assessing director nominee qualifications include, without limitation, issues of character, professional ethics and integrity, judgment, business experience and diversity, and with respect to diversity, such factors as race, ethnicity, gender, differences in professional background, age and geography, as well as other individual qualities and attributes that contribute to the total mix of viewpoints and experience represented on our board of directors. Although our board of directors does not maintain a specific policy with respect to board diversity, our board of directors believes that the board of directors should be a diverse body, and the nominating and corporate governance committee considers a broad range of perspectives, backgrounds and experiences. If our nominating and corporate governance committee determines that an additional or replacement director is required, then the committee may take such measures as it considers appropriate in connection with its evaluation of a director candidate, including candidate interviews, inquiry of the person or persons making the recommendation or nomination, engagement of an outside search firm to gather additional information, or reliance on the knowledge of the members of the committee, board of directors or management. In 2023, we paid a third-party search firm to assist in identifying candidates to join our board of directors. After completing its review and evaluation of director candidates, our nominating and corporate governance committee recommends to our full board of directors the director nominees for selection. Our nominating and corporate governance committee has discretion to decide which individuals to recommend for nomination as directors and our board of directors has the final authority in determining the selection of director candidates for nomination to our board of directors.
ELECTION OF CLASS III DIRECTORS
ELECTION OF CLASS III DIRECTORS Our board of directors currently consists of ten directors and is divided into three classes with staggered three-year terms. At the Annual Meeting, two Class III directors will be elected for a three-year term to succeed the same class whose term is then expiring. Each director’s term continues until the expiration of the term for which such director was elected and until such director’s successor is elected and qualified or until such director’s earlier death, resignation or removal.
COMPENSATION DISCUSSION AND ANALYSIS
| What We Do | | What We Do Not Do | | | ✓ | Annual Review. We perform annual reviews of our executive compensation program. | × | No Executive-Only Retirement Programs. We do not offer pension arrangements, retirement plans, or nonqualified deferred compensation plans or arrangements to our executive officers, other than the plans available to all employees. | | ✓ | Performance-Based Equity. In 2023, we continued to use performance-based equity as a significant part of our compensation program for our NEOs. | × | No Excise Tax Gross-Ups. We do not offer golden parachute tax gross-ups to any of our NEOs or other executive officers. | | ✓ | Independence. Our compensation committee is composed solely of independent directors and makes all executive compensation decisions. | × | No “Single-Trigger” Benefits and Limited “Double-Trigger” Benefits. Potential change in control payments and benefits are limited in nature and are received only in connection with the termination of employment without cause or for good reason in connection with or following a change in control. | | ✓ | Compensation Consultant. Our compensation committee engages its own independent compensation consultant to assist with its compensation reviews. | × | No timing grant to release of material non-public information. We do not have a policy or practice to time equity awards to the release of material non-public information. |
Fiscal 2023 Executive Compensation Highlights
| • | Annual Bonuses Reflecting Pay for Performance—A significant portion of compensation paid to our NEOs consists of performance-based annual bonuses that were only earned based on our achievement of our corporate goals. |
Fiscal 2023 Executive Compensation Highlights
| • | Equity Awards Promoting Our Stockholders’ Interests—Equity incentives constituted a significant majority of compensation paid to NEOs in 2023. Equity incentives align the interests of executives with those of our stockholders. For fiscal 2023, we provided equity compensation to our NEOs in a mix of performance-based and time-based equity awards. In particular, in August 2023, we granted special four-year front-loaded performance-based restricted stock unit (PSU) awards to our NEOs (other than Mr. Chapman, who requested we reallocate any potential awards to the Company’s other executive officers and employees), which were intended to provide two-thirds of the regular annual equity grant value through December 31, 2026, as explained in more detail below in the section titled “—Executive Compensation Program Components—Equity Compensation.” |
Executive Compensation Philosophy and Objectives
| • | Balance short-term financial results with long-term strategic objectives; |
Executive Compensation Philosophy and Objectives
| • | Reward achievement of challenging corporate objectives and exceeding performance measures, without encouraging inappropriate risk-taking; |
Executive Compensation Philosophy and Objectives
| • | Provide competitive pay packages capable of attracting and retaining top talent, sometimes from larger, well-established technology companies; and |
Compensation Program Design
Compensation Program Design Our executive compensation program for fiscal 2023 reflected our stage of development as a growing publicly traded company. Accordingly, the compensation of our NEOs consisted of base salary, a short-term incentive compensation opportunity payable in a mix of cash and equity, long-term equity compensation, and certain employee health and welfare benefits. We offer cash compensation in the form of base salaries and cash incentive compensation opportunities with an annual payment component. Typically, we have structured our annual cash incentive compensation opportunities to focus on the achievement of specific short-term financial and operational objectives that will further our longer-term growth objectives. Additionally, equity awards for shares of our common stock serve as a key component of our executive compensation program. For 2023, we granted a mix of (i) performance-based restricted stock units (“PRSUs”) (which become eligible to vest only if the threshold performance is achieved) to our NEOs other than our President and Chief Executive Officer and (ii) restricted stock units (“RSUs”) (which provide certain value to recipients and limit dilution to our stockholders) to our NEOs other than our President and Chief Executive Officer and our Chief Revenue Officer. In the future, we may introduce other forms of equity awards, as we deem appropriate, into our executive compensation program to offer our NEOs additional types of long-term incentive compensation that further the objective of aligning the recipient’s interests with those of our stockholders. Finally, we offer executives standard health and welfare benefits that are available to our other employees, including medical, dental, vision, flexible spending accounts, life insurance and 401(k) plans. We have not adopted any formal policies or guidelines for allocating compensation between current and long-term compensation or between cash and non-cash compensation, although we use competitive market data and peer group comparisons to understand the competitive market framework for pay mix. Within this overall framework, our compensation committee reviews each component of executive compensation separately, and also takes into consideration the value of each NEO’s compensation package as a whole and its relative value in comparison to our other NEOs. Our compensation committee evaluates our compensation philosophy and executive compensation program as circumstances require, and reviews executive compensation at least annually. As part of this review, we expect that our compensation committee will apply our philosophy and the objectives outlined above, together with consideration for the levels of compensation that we would be willing to pay to ensure that our executive compensation remains competitive and that we meet our retention objectives, as well as the cost to us if we were required to find a replacement for a key executive officer.
Executive Compensation Peer Group for Fiscal 2023
Executive Compensation Peer Group for Fiscal 2023
Executive Compensation Peer Group for Fiscal 2023
| A10 Networks | ACM Research | Ambarella | Appian | | BigCommerce | Desktop Metal | Domo | Impinj | | Jamf | MaxLinear | Model N | nLight | | Onto Innovation | PDF Solutions | Ping Identity | Repay | | SiTime | Sprout Social | Sumo Logic | Telos | | Tenable | | | |
Executive Compensation Peer Group for Fiscal 2023
We positioned, generally, with companies with revenue below $200 million and with market capitalization between $600 million and $6 billion. Additionally, for fiscal 2023, Compensia provided our compensation committee with an analysis of market data from the Radford Compensation Database reflecting public technology companies with annual revenues between $50 million and $500 million. However, our compensation committee does not benchmark with respect to any particular element of compensation.
Executive Compensation Program Components
Annual Incentive Compensation; 2023 Bonus Plan Our annual incentive compensation program focuses on incentivizing and rewarding achievement of a select set of the most business-critical Company goals and metrics and which are shorter-term in nature and usually aligned to the fiscal year, using an Objectives and Key Results (“OKR”) framework. Each year the executive team proposes a set of the most critical Company OKRs, suggests a weighting for each goal and obtains the compensation committee’s agreement. This set of OKRs will include committed OKRs, which are binary—the metric must be met to contribute the full weighted amount of bonus to the pool. There will also be aspirational OKRs which contribute to the final bonus pool and will be measured on a prorated basis of success once the metric of the committed goal is met. The compensation committee will advise and approve the final list of objectives and weighting each year. The structure of our 2023 annual incentive compensation program was a mix of cash and RSUs, which vested immediately, earned from 0-2x percent-of-salary target amounts for achievement of OKRs that drive stockholder value creation. Penalty for underachievement and reward for overachievement is moderate to mitigate compensation-related risk and focus on our resilience and sustainability over time. All executives are measured based on Company OKR results. In May 2023, our compensation committee set the terms and conditions of our annual cash bonus program for fiscal 2023 (the “2023 Bonus Plan”). It provided that our NEOs were eligible to earn 100% of their target bonus based on target achievement against three technical and one operational primary goal, as follows:
Executive Compensation Program Components
| Named Executive Officer | Bonus Opportunity as Percentage of Base Salary | Primary Goal Bonus Opportunity | Stretch Goal Bonus Opportunity | | Peter Chapman | 100% | $505,000 | $505,000 | | Thomas Kramer | 65% | $241,800 | $241,800 | | Rima Alameddine(1) | 50% | $200,000 | $200,000 | | Jungsang Kim | 50% | $180,250 | $180,250 | | Christopher Monroe | 50% | $100,000 | $100,000 |
Executive Compensation Program Components
| (1) Ms. Alameddine was also eligible for a sales bonus equal to 50% of her base salary, as described below. |
Executive Compensation Program Components
| Named Executive Officer | Bonus Earned in 2023 ($)(1)(2) | Cash Amount Paid in 2024 ($) | RSUs Granted in 2024 (#)(1) | | Peter Chapman | 880,000 | 440,000 | 40,937 | | Thomas Kramer | 420,000 | 210,000 | 19,538 | | Rima Alameddine | 350,000 | 175,000 | 16,281 | | Jungsang Kim | 180,000 | 90,000 | 8,373 | | Christopher Monroe(3) | — | — | — |
Executive Compensation Program Components
| (1) Bonus amounts were earned based on a dollar amount and converted to RSUs based on the 22-day average stock price of the Company’s common stock from the day prior to the grant date. As a result, the grant date fair value of the RSUs granted as a result of performance with respect to our 2023 annual incentive program is different than the target cash amount. |
Executive Compensation Program Components
| (2) The bonus amount payable to our NEOs was adjusted to reflect a number of considerations, including the NEOs’ contributions to the achievement of our performance goals and expected future contributions. Except in the case of Dr. Kim, this was an upward adjustment of 1% or less. |
Executive Compensation Program Components
| (3) Dr. Monroe was not eligible for a bonus as a result of his resignation. |
Executive Compensation Program Components
Sales Bonus In addition to the annual incentive compensation described above, for 2023, Ms. Alameddine was eligible for a sales bonus of up to $200,000, based on the achievement of sales and bookings goals. Based on achievement for 2023 with respect to the bookings goal, Ms. Alameddine received a sales bonus of $200,000. Equity Compensation We use equity awards to incentivize and reward our executives (including our NEOs) for long-term corporate performance based on the value of our common stock and, thereby, to align the interests of our executives with those of our stockholders. We may grant stock options covering shares of our common stock and full value awards for shares of our common stock, or awards without a purchase price, such as RSU awards. New hire, or initial, equity awards for our executives are established through arm’s-length negotiations at the time the individual executive is hired. In making these awards, we consider, among other things, the prospective role and responsibility of the individual executive, competitive factors, the expectations concerning the size of the equity award, the cash compensation to be received by the executive, and the need to create a meaningful opportunity for reward predicated on the creation of long-term stockholder value. In addition, we grant equity awards to our executives when our compensation committee determines that such awards are necessary or appropriate to recognize corporate and individual performance, in recognition of a promotion, or to achieve our retention objectives. To date, we have not applied a rigid formula in determining the size of these equity awards. Instead, our compensation committee has determined the size of such equity awards for an individual executive after taking into consideration market data compiled from our compensation peer group, a compensation analysis performed by AON, the equity award recommendations of our President and Chief Executive Officer, the scope of an executive’s performance, contributions, responsibilities, and experience, and the amount of equity compensation held by the executive, including the current economic value of his or her outstanding unvested equity awards and the ability of this equity to satisfy our retention objectives, market conditions, and internal equity considerations. In making its award decisions, our compensation committee has exercised its judgment and discretion to set the size of each award at a level it considered appropriate to create a meaningful opportunity for reward predicated on the creation of long-term stockholder value. Equity awards to our NEOs typically have four year vesting periods. For fiscal 2023, in August 2023 our compensation committee provided equity compensation to our NEOs in a mix of RSUs, and special four-year front-loaded performance PSUs other than our President and Chief Executive Officer. The compensation committee recommended PSU and RSU awards for Mr. Chapman, however, Mr. Chapman requested that the awards not be granted. Given Mr. Chapman’s existing equity position, Mr. Chapman asked that new awards that would otherwise have been allocated to him be reserved for distribution to existing employees and new hires to increase the size of those awards to help recruitment and retention efforts to attract top-level talent to the Company. The PSU awards were designed following detailed and extensive analysis conducted by the compensation committee’s independent compensation consultant under the compensation committee’s direction. The PSUs are subject to both time- and performance-based vesting requirements and are designed to:
Executive Compensation Program Components
| • | align interests of the Company’s executives and key employees with those of its long-term stockholders and encourage their continued employment with the Company; |
Executive Compensation Program Components
| • | reward exceptional stockholder value creation over the PSU Performance Period (as defined below); and |
Executive Compensation Program Components
For 2023, each PSU award represents two-thirds of the annual target long-term incentive (“LTI”) opportunity and the RSU award represents one-third of the annual target LTI opportunity. The PSU awards were structured as a partial four-year front load (i.e., the PSUs granted are intended to cover planned performance-based equity award grants for 2023 through 2026 (the “PSU Performance Period”)). Accordingly, the participants will only be eligible to receive annual time-based RSU awards equal to one-third of the annual target LTI opportunity for each year during the PSU Performance Period. The PSUs provide the opportunity for participants to receive shares of Company common stock based on performance aggregated over the PSU Performance Period with respect to certain technical and financial goals, each of which represent 50% of the target PSU opportunity, and a stock price hurdle requirement. In the event our 60-trading day average closing price per share of the common stock does not equal or exceed a pre-defined share price at the end of the PSU Performance Period, the maximum PSU opportunity shall be limited to target (100%) performance. Achievement could range from 0% to 300% of the target number of PSUs offered to the participant. Each PSU granted represents the right to receive one share of common stock based on target performance, but the ultimate number of shares of common stock earned with respect to a participant’s PSUs will be determined as of the completion of the PSU Performance Period. The PSU Performance Period will end on December 31, 2026, unless the maximum performance goals are achieved during the first three years of the PSU Performance Period which would accelerate the PSU Performance Period end date to December 31, 2025. There will be no other progress performance vesting during the PSU Performance Period. Pursuant to the PSU award agreement and the 2021 Equity Incentive Plan (the “2021 Plan”), the PSUs will continue to be outstanding and may vest for so long as the recipient is in Continuous Service as an employee of the Company (and any successor) or an Affiliate generally through completion of the PSU Performance Period. The following provisions further apply to the PSUs in the circumstances described below:
Executive Compensation Program Components
| • | Voluntary Termination or Retirement. Upon a participant’s voluntary termination or retirement from the Company prior to the performance certification date following completion of the PSU Performance Period, all PSUs will be forfeited. |
Executive Compensation Program Components
| • | Involuntary Termination. If the participant’s employment with the Company is terminated by the Company without “Cause” or as a result of the participant’s resignation from the Company for “Good Reason” (each as defined in the applicable PSU award agreement and such termination, an “Involuntary Termination”), the number of PSUs vesting will be measured as of the termination date, based on target (100%) performance if the Involuntary Termination occurs in the first three years of the PSU Performance Period or based on projected performance achievement if the Involuntary Termination occurs in the fourth year of the PSU Performance Period, prorated for months worked as a fraction of 48 months for a participant employed on or before January 1, 2023, or the number of months from the later employment date to December 31, 2026, for a participant employed after January 1, 2023. Satisfaction of the stock price hurdle will be assessed based on the 60-trading day average closing price per share of the common stock for the period ending on the termination date. Any unearned PSUs will be forfeited. |
Executive Compensation Program Components
| • | Change in Control. In the case of a change-in control of the Company as defined in the 2021 Plan (a “CIC”) where (i) the PSUs are not assumed or (ii) if the PSUs are assumed and an Involuntary Termination occurs within 12 months of a CIC, the number of PSUs vesting will be determined based on projected performance achievement and satisfaction of the stock price hurdle which will be assessed based on the 60-trading day average closing price per share of the common stock for the period ending on and including the effective date of the CIC or, in the case of an Involuntary Termination following a CIC, the applicable termination date, and in either case will be prorated for months worked as a fraction of 48 months for a participant employed on or before January 1, 2023, or the number of months from the later employment date to December 31, 2026, for a participant employed after January 1, 2023. Any unearned PSUs will be forfeited. |
Executive Compensation Program Components
| • | Death or Disability. In the case of the participant’s death or disability, the PSUs will remain outstanding and may be earned during the performance term. |
Executive Compensation Program Components
| Named Executive Officer | Target Grant Value ($) | Performance- Based RSUs (#) | Time- Based RSUs (#) | | Peter Chapman | — | — | — | | Thomas Kramer | 2,750,000 | 458,880 | 57,360 | | Rima Alameddine(1) | 2,000,000 | 333,731 | — | | Jungsang Kim | 3,000,000 | 500,597 | 62,574 | | Christopher Monroe | 2,000,000 | 333,731 | 41,716 |
Executive Compensation Program Components
| (1) Ms. Alameddine received a new hire RSU award in connection with the commencement of her employment with the Company in December 2022 and, accordingly, did not receive an additional RSU award. |
Employment Arrangements
Employment Arrangements Each of our NEOs is an at-will employee with certain rights to advance notice prior to termination as provided under the Change in Control Severance Plan. Each NEO is eligible to participate in the Change in Control Severance Plan under the terms and conditions of such plan. See the section below titled “—Change in Control Severance Plan” for additional information. Peter Chapman In September 2021, we entered into an amended and restated offer letter agreement with Mr. Chapman which governs the current terms of his employment as our President and Chief Executive Officer. Mr. Chapman’s annual base salary for fiscal 2023 was $505,000, effective April 1, 2023, increased from $410,000. Mr. Chapman is eligible to participate in any bonus plan that may be established for executive officers and is also eligible for reimbursement of business expenses and to participate in our standard employee benefit plans and programs. Thomas Kramer In September 2021, we entered into an amended and restated offer letter agreement with Mr. Kramer which governs the current terms of his employment as our Chief Financial Officer. Mr. Kramer’s annual base salary for fiscal 2023 was $400,000, effective April 1, 2023, increased from $288,000. Mr. Kramer is eligible to participate in any bonus plan that may be established for executive officers and is also eligible for reimbursement of business expenses and to participate in our standard employee benefit plans and programs. Rima Alameddine In December 2022, we entered into an offer letter agreement with Ms. Alameddine that established an employment relationship and governs the current terms of her employment as our Chief Revenue Officer. Ms. Alameddine’s annual base salary for fiscal 2023 was $400,000. Ms. Alameddine is eligible to participate in any bonus plan that may be established for executive officers and is also eligible for reimbursement of business expenses and to participate in our standard employee benefit plans and programs. Jungsang Kim In September 2021, we entered into an amended and restated offer letter agreement with Dr. Kim that established an employment relationship and governed the terms of his employment as our Chief Technology Officer. Dr. Kim’s annual base salary for fiscal 2023 was $364,000, effective April 1, 2023, increased from $350,000. Dr. Kim voluntarily resigned as our Chief Technology Officer effective March 31, 2024, and received no severance. In connection with his resignation, his PSU award granted in August 2023 was forfeited entirely. Christopher Monroe In September 2021, we entered into an amended and restated offer letter agreement with Dr. Monroe that established an employment relationship and governed the terms of his employment as our Chief Scientist. Dr. Monroe’s annual base salary for fiscal 2023 was $200,000. Dr. Monroe voluntarily resigned as our Chief Scientist effective November 1, 2023, and received no severance. In connection with his resignation, all of his unvested equity awards were forfeited entirely.
Change in Control Severance Plan
Change in Control Severance Plan Each of our executive officers, including the NEOs, (in the case of Dr. Kim, prior to his resignation) is eligible to receive severance benefits under the terms of the IonQ, Inc. Change in Control Severance Plan. The Change in Control Severance Plan provides for severance benefits upon a “covered termination” that occurs outside of or during a “change in control period” (each as described below). Upon a covered termination that occurs outside of the period beginning on the effective date of a change in control (as defined in our 2021 Plan and ending on the first anniversary thereof (the “change in control period”), each participant will be entitled to (1) a payment equal to the participant’s base salary for a period of months (12 months for Mr. Chapman; 6 months for Mr. Kramer, and Ms. Alameddine) less applicable tax withholdings to be paid in equal installments on our regular payroll schedule or in a lump sum, as we determine, and in compliance with Section 409A of the Code, and (2) payment of continued group health benefits for a period of time matching the applicable severance term. Upon a covered termination that occurs during a change in control period, participants will be entitled to (1) a payment equal to the participant’s base salary for a period of months (12 months for Mr. Chapman, Mr. Kramer, and Ms. Alameddine) less applicable tax withholdings to be paid in equal installments on the Company’s regular payroll schedule or in a lump sum, as we determine, and in compliance with Section 409A of the Code; (2) a payment equal to a multiple of the participant’s target annual bonus (100% for Mr. Chapman, Mr. Kramer, and Ms. Alameddine) less applicable tax withholdings to be paid in equal installments on our regular payroll schedule or in a lump sum, as we determine, and in compliance with Section 409A of the Code; (3) payment of continued group health benefits; and (4) full accelerated vesting of all outstanding equity awards subject to time-based vesting. All severance benefits under the Change in Control Severance Plan are subject to certain rights to advance notice prior to termination and the participant’s execution of an effective release of claims in favor of us and compliance with the terms of any confidential information, proprietary information and inventions agreement and any other agreement between the participant and IonQ. For purposes of the Change in Control Severance Plan, a “covered termination” is a termination of employment by IonQ without “cause,” as defined in the Change in Control Severance Plan, or as a result of the participant’s resignation for “good reason,” as defined in the Change in Control Severance Plan, in either case, not as a result of death or disability.
Accounting and Tax Considerations
Accounting and Tax Considerations Prior to January 1, 2018, Internal Revenue Code Section 162(m) limited the amount that we could deduct for compensation paid to our President and Chief Executive Officer and certain other highly compensated officers to $1,000,000 per person, unless the compensation was “performance-based” as defined under Section 162(m). As a result of the 2017 Tax Cuts and Jobs Act, the number of individuals covered by Section 162(m) has been expanded to include our principal financial officer and the exception for “performance-based” compensation has been eliminated. While our compensation committee cannot predict how the deductibility limit may impact our compensation program in future years, our compensation committee intends to maintain an approach to executive compensation that is intended principally to link pay to performance. Section 409A of the Code imposes additional significant taxes in the event that an executive officer, director, or other service provider receives “deferred compensation” that does not satisfy the requirements of Section 409A. Although we do not maintain traditional nonqualified deferred compensation plans, Section 409A does apply to certain change in control severance arrangements. Consequently, to assist in avoiding additional tax under Section 409A, we have designed the change in control and severance arrangements described above in a manner to avoid the application of Section 409A.
Summary Compensation Table
Summary Compensation Table The following table sets forth information for each of the last three completed fiscal years regarding compensation awarded to or earned by NEOs during the fiscal years indicated:
Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($)(1)(2) | Option Awards ($)(1)(2) | Non-Equity Incentive Plan Compensation ($) | All Other Compensation ($) | Total ($) | | Peter Chapman | 2023 | 481,250 | — | 413,054 | — | 440,000 | 4,371(3)(4) | 1,338,675 | | President and Chief Executive Officer | 2022 | 380,000 | 368,300 | 4,111,806(5) | 3,606,932 | — | 15,250 | 8,482,288 | | | 2021 | 350,000 | — | — | — | — | 14,500 | 364,500 | | Thomas Kramer | 2023 | 372,000 | — | 8,229,833 | — | 210,000 | 4,300(3)(4) | 8,816,133 | | Chief Financial Officer | 2022 | 244,000 | 225,000 | 1,392,808 | 1,180,449 | — | 5,417 | 3,047,674 | | | 2021 | 175,769 | — | — | 17,067,337 | — | 8,788 | 17,251,894 | | Rima Alameddine | 2023 | 400,000 | 550,000(6) | 5,357,130 | — | 375,000 | 100(4) | 6,682,230 | | Chief Revenue Officer | 2022 | 30,303 | 50,000 | 3,348,000 | 3,279,166 | — | — | 6,707,469 | | Jungsang Kim | 2023 | 360,500 | 1,000(7) | 8,847,424 | — | 90,000 | 100(4) | 9,299,024 | | former Chief Technology Officer | 2022 | 315,000 | 115,300 | 1,352,779 | 1,180,449 | — | — | 2,963,528 | | | 2021 | 280,000 | — | — | 2,973,049 | — | — | 3,253,049 | | Christopher Monroe | 2023 | 167,424 | 6,300(7) | 5,841,955 | — | — | — | 6,015,679 | | former Chief Scientist | | | | | | | | |
Summary Compensation Table
| (1) The amounts in these columns reflect the aggregate grant date fair value of the shares underlying restricted stock unit awards, performance-based restricted stock unit awards, and option awards granted in the applicable year, computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718 for stock-based compensation transactions. The assumptions we used in valuing these awards are described in Note 14 to our consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC on February 28, 2024 and do not necessarily correspond to the actual economic value recognized or that may be recognized by the NEOs. |
Summary Compensation Table
| (2) See the section titled “—Compensation Discussion and Analysis—Equity Compensation” above for a description of the material terms of the program pursuant to which this compensation was awarded. For performance-based restricted stock units, the amount reported represents the grant-date fair value based upon the probable outcome of the performance conditions for such awards, consistent with the estimate of aggregate compensation cost to be recognized over the service period determined as of the grant date under FASB ASC Topic 718, excluding the effect of estimated forfeitures, which yields a grant date fair value of $7,140,173 for Mr. Kramer, $5,192,854 for Ms. Alameddine, $7,789,289 for Dr. Kim, and $5,192,854 for Dr. Monroe. If maximum performance were deemed achieved for the performance-based restricted stock unit awards for which the performance conditions have been determined, the grant-date fair value of such awards would be $19,520,755 for Mr. Kramer, $14,196,917 for Ms. Alameddine, $21,295,396 for Dr. Kim, and $14,196,917 for Dr. Monroe. |
Summary Compensation Table
| (3) Represents a 401(k) matching contribution. |
Summary Compensation Table
| (4) Represents a $100 gift card. |
Summary Compensation Table
| (5) This amount has been increased from the amount reflected in our 2023 proxy statement to reflect the value of RSUs granted in 2023 with respect to our annual incentive program for 2022, which were granted in May 2023. Amounts earned under our annual incentive program for 2022 were paid 100% in RSUs. |
Summary Compensation Table
| (6) Represents Ms. Alameddine’s signing bonus that was paid pursuant to the terms of her employment agreement. |
Summary Compensation Table
| (7) Represents a patent incentive award. |
Outstanding Equity Awards at 2023 Fiscal Year End
Outstanding Equity Awards at 2023 Fiscal Year End The following table presents information regarding outstanding option and stock awards held by the NEOs as of December 31, 2023. All awards granted on or prior to September 30, 2021 were granted pursuant to the 2015 Equity Incentive Plan (the “2015 Plan”). All awards granted after September 30, 2021 were granted pursuant to the 2021 Plan.
Outstanding Equity Awards at 2023 Fiscal Year End
| | | | Option Awards(7) | | | | Stock Awards(7) | | | | | Name | Grant Date | Vesting Commencement Date | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | Number of shares or units of stock that have not vested (#) | Market value of shares of units of stock that have not vested ($)(6) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested($)(6) | | Peter Chapman | 5/17/2019 | 5/17/2019 | 7,422,162 | 674,743(1) | $0.13 | 5/16/2029 | — | — | — | — | | | 8/18/2022 | 9/10/2022 | 265,102 | 441,838(2) | $7.63 | 8/17/2032 | 295,826(2) | 3,665,284 | — | — | | Thomas Kramer | 2/19/2021 | 2/15/2021 | 855,578 | 1,170,802(1) | $2.39 | 2/18/2031 | — | — | — | — | | | 8/18/2022 | 9/10/2022 | 86,760 | 144,602(2) | $7.63 | 8/17/2032 | 96,816(2) | 1,199,550 | — | — | | | 8/15/2023 | 9/10/2023 | — | — | — | — | 50,190(2) | 621,854 | — | — | | | 8/15/2023 | 1/1/2023 | — | — | — | — | — | — | 267,680(3) | 3,316,555 | | Rima Alameddine | 12/5/2022 | 12/10/2023 | 259,500 | 778,500(4) | $4.65 | 12/4/2032 | 540,000(4) | 6,690,600 | — | — | | | 8/15/2023 | 1/1/2023 | — | — | — | — | — | — | 194,676(3) | 2,412,036 | | Jungsang Kim | 11/3/2020 | 12/31/2020 | 708,485 | 465,566(5) | $0.69 | 11/2/2030 | — | — | — | — | | | 3/4/2021 | 4/30/2021 | 222,658 | 182,187(5) | $2.39 | 3/3/2031 | — | — | — | — | | | 8/18/2022 | 9/10/2022 | 86,760 | 144,602(2) | $7.63 | 8/17/2032 | 96,816(2) | 1,199,550 | — | — | | | 8/15/2023 | 9/10/2023 | — | — | — | — | 54,753(2) | 678,390 | — | — | | | 8/15/2023 | 1/1/2023 | — | — | — | — | — | — | 292,014(3) | 3,618,053 | | Christopher Monroe | 1/25/2019 | 8/27/2018 | 246,686 | — | $0.14 | 1/24/2029 | — | — | — | — | | | 11/03/2020 | 11/3/2020 | 708,485 | — | $0.69 | 11/2/2030 | — | — | — | — | | | 3/4/2021 | 3/5/2021 | 209,160 | — | $2.39 | 3/3/2031 | — | — | — | — | | | 8/18/2022 | 9/10/2022 | 40,166 | — | $7.63 | 8/17/2032 | — | — | — | — |
Outstanding Equity Awards at 2023 Fiscal Year End
| (1) 10% of the shares of common stock underlying the option vested on the six-month anniversary of the vesting commencement date and 1/54th of the remaining shares vested or will vest on the last day of each month following the six-month anniversary of the vesting commencement date, subject to the holder remaining in continuous service with us on each vesting date. |
Outstanding Equity Awards at 2023 Fiscal Year End
| (2) 1/16th of the shares of common stock underlying the award vested on the vesting commencement date and vested or will vest quarterly thereafter on each March 10, June 10, September 10, and December 10, subject to the holder remaining in continuous service with us on each vesting date. |
Outstanding Equity Awards at 2023 Fiscal Year End
| (3) The shares of common stock underlying the award vest in connection with the achievement of performance goals in the performance period ending December 31, 2026, subject to the recipient’s continuous service with us on the vesting date. |
Outstanding Equity Awards at 2023 Fiscal Year End
| (4) 25% of the shares of common stock underlying the option or award will vest on the vesting commencement date and 1/12th of the remaining shares vested or will vest quarterly on each March 10, June 10, September 10, and December 10, thereafter, subject to the holder remaining in continuous service with us on each vesting date. |
Outstanding Equity Awards at 2023 Fiscal Year End
| (5) The shares of common stock underlying the option vested or shall vest 1/60th on the last day of each month commencing on the vesting commencement date, subject to the holder remaining in Continuous Service with the Company on each vesting date. |
Outstanding Equity Awards at 2023 Fiscal Year End
| (6) The market value of unvested shares is calculated by multiplying the number of unvested shares by the closing market price of our common stock on the NYSE on December 29, 2023, the last trading day of the year, which was $12.39 per share. |
Outstanding Equity Awards at 2023 Fiscal Year End
| (7) If a NEO experiences a covered termination during a change in control period, any then outstanding unvested shares of common stock subject to this option or stock award will become vested and exercisable. See the section below titled “—Change in Control Severance Plan” for additional information. |
Fiscal 2023 Grants of Plan-Based Awards
Fiscal 2023 Grants of Plan-Based Awards The following table presents information concerning each grant of a plan-based award made to a NEO in fiscal 2023 under any plan.
Fiscal 2023 Grants of Plan-Based Awards
| | | Estimated Future Payments Under Non-Equity Incentive Plan Awards | | Estimated Future Payments Under Equity Incentive Plan Awards | | | | | | | | Name | Grant Date | Target ($) | Maximum ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | All Other Stock Awards: Number of Shares of Stock or Units (#) | Grant Date Fair Value of Stock Awards ($) | | Peter Chapman | (1) | 252,500 | 505,000 | 252,500 | 505,000 | — | — | — | — | — | | Thomas Kramer | (1) | 120,900 | 241,800 | 120,900 | 241,800 | — | — | — | — | — | | | 8/15/2023 | — | — | — | — | 267,680 | 458,880 | 1,376,640 | 57,360 | 8,032,694 | | Rima Alameddine | (1) | 100,000 | 200,000 | 100,000 | 200,000 | — | — | — | — | — | | | (2) | 200,000 | 200,000 | — | — | — | — | — | — | — | | | 8/15/2023 | — | — | — | — | 194,676 | 333,731 | 1,001,193 | — | 5,192,854 | | Jungsang Kim | (1) | 90,125 | 180,250 | 90,125 | 180,250 | — | — | — | — | — | | | 8/15/2023 | — | — | — | — | 292,014 | 500,597 | 1,501,791 | 62,574 | 8,762,941 | | Christopher Monroe | (1) | 50,000 | 100,000 | 50,000 | 100,000 | — | — | — | — | | | | 8/15/2023 | — | — | — | — | 194,676 | 333,731 | 1,001,193 | 41,716 | 5,841,955 |
Fiscal 2023 Grants of Plan-Based Awards
| (1) 2023 Annual Incentive Plan: as described above in the section titled “—Compensation Discussion and Analysis,” for 2023, our NEOs were eligible to earn a bonus in accordance with our annual incentive plan, payable 50% in cash and 50% in RSUs. |
Fiscal 2023 Grants of Plan-Based Awards
| (2) Sales Bonus: as described above in the section titled “—Compensation Discussion and Analysis,” for 2023, Ms. Alameddine was eligible to earn a sales bonus equal to 50% of her base salary, payable 100% in cash. |
Fiscal 2023 Option Exercises and Stock Vested
Fiscal 2023 Option Exercises and Stock Vested
Fiscal 2023 Option Exercises and Stock Vested
| | Stock Awards | | | Name | Number of Shares Acquired on Vesting | Value Realized on Vesting | | Peter Chapman | 167,194 | $2,186,828 | | Thomas Kramer | 66,490 | $876,849 | | Rima Alameddine | 180,000 | $2,464,200 | | Jungsang Kim | 63,232 | $832,247 | | Christopher Monroe | 27,410 | $309,540 |
Pension Benefits
Pension Benefits We did not sponsor any defined benefit pension or other actuarial plan for our NEOs during fiscal 2023.
Nonqualified Deferred Compensation
Nonqualified Deferred Compensation We did not maintain any nonqualified defined contribution or other deferred compensation plans or arrangements for our NEOs during fiscal 2023.
Potential Payments Upon Termination or Change in Control
Potential Payments Upon Termination or Change in Control
Potential Payments Upon Termination or Change in Control
| | Termination Without Cause or Resignation for Good Reason | | | | Termination Without Cause or Resignation for Good Reason in Connection with a Change in Control (“Double Trigger”) | | | | | Name | Salary Severance ($) | Bonus Severance ($) | Value of Continued Health Coverage ($) | Value of Accelerated Vesting ($)(1) | Salary Severance ($) | Bonus Severance ($) | Value of Continued Health Coverage ($) | Value of Accelerated Vesting ($)(1) | | Peter Chapman | $505,000 | $— | $19,715 | $— | $505,000 | $505,000 | $19,715 | $14,038,488 | | Thomas Kramer | $200,000 | $— | $12,084 | $1,421,381 | $400,000 | $260,000 | $24,168 | $14,927,249 | | Rima Alameddine | $200,000 | $— | $13,261 | $1,033,732 | $400,000 | $400,000 | $26,522 | $13,233,057 | | Jungsang Kim | $182,000 | $— | $— | $1,550,599 | $364,000 | $182,000 | $— | $10,610,729 |
Potential Payments Upon Termination or Change in Control
| (1) The amounts reported in the table above reflect the aggregate market value of the unvested shares of our common stock underlying outstanding restricted stock unit awards and stock options that would become vested on a qualifying termination. For the unvested stock options, the aggregate market value is computed by multiplying (i) the number of shares of our common stock underlying unvested and outstanding stock options as of December 31, 2023, that would become vested by (ii) the difference between $12.39 (the closing market price of our common stock on NYSE on December 29, 2023) and the exercise price of such option. For the restricted stock unit awards, the aggregate market value is computed by multiplying (i) the number of unvested shares of our common stock subject to outstanding restricted stock awards or outstanding restricted stock unit awards as of December 31, 2023, that would become vested by (ii) $12.39 (the closing market price of our common stock on NYSE on December 29, 2023). |
Potential Payments Upon Termination or Change in Control
In accordance with the terms of the PSU awards granted to our NEOs in August 2023, upon an “involuntary termination” of employment other than in connection with a “change in control” (as such terms are defined in the applicable award agreement) occurring on December 31, 2023, a pro-rated portion of the target number of PSUs will vest, subject to the applicable NEO executing a release of claims in favor of the Company. Upon an involuntary termination of employment within 12 months following a change in control, a pro-rated portion of the projected achievement of the performance metrics and satisfaction of the stock price hurdle would vest, subject to the applicable NEO executing a release of claims in favor of the Company.
DIRECTOR COMPENSATION
DIRECTOR COMPENSATION
Non-Employee Director Compensation Table
Non-Employee Director Compensation Table The following table sets forth information regarding the compensation awarded to or earned for service on the board of directors by our non-employee directors during the year ended December 31, 2023. As NEOs, the compensation received by Mr. Chapman and Dr. Kim is shown above in the section titled “—Executive Compensation—Summary Compensation Table.”
Non-Employee Director Compensation Table
| Name | Fees Earned or Paid in Cash ($) | Option Awards(1)(2) ($) | Stock Awards(2) ($) | Total ($) | | Craig Barratt | 64,411 | 139,322 | 131,105 | 334,838 | | Ronald Bernal | 33,000 | 139,322 | 131,105 | 303,427 | | Kathryn Chou | 40,318 | 139,322 | 131,105 | 310,745 | | Niccolo de Masi | 44,318 | 139,322 | 131,105 | 314,745 | | Inder Singh | 39,739 | 139,322 | 131,105 | 310,166 | | Wendy Thomas | 34,000 | 139,322 | 131,105 | 304,427 | | Harry You | 52,609 | 139,322 | 131,105 | 323,036 |
Non-Employee Director Compensation Table
| (1) The amounts reported in this column reflect the aggregate grant date fair value of the shares underlying option awards granted to our directors as computed in accordance with ASC Topic 718. See Note 14 to our consolidated financial statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC on February 28, 2024 for a discussion of assumptions made by us in determining the aggregate grant date fair value of our option awards. Note that the amounts reported in this column reflect the accounting cost for these stock options and do not reflect the actual economic value that may be realized by the directors upon the vesting of the stock options, the exercise of the stock options or the sale of the common stock underlying such stock options. |
Non-Employee Director Compensation Table
| (2) The following table provides information regarding the aggregate number of equity awards granted to our non-employee directors that were outstanding as of December 31, 2023: |
Non-Employee Director Compensation Table
| Name | Option Awards Outstanding at Year-End (#) | Restricted Stock Outstanding at Year-End (#) | | Craig Barratt | 55,230 | 9,690 | | Ronald Bernal | — | — | | Kathryn Chou | 78,760 | 36,844 | | Niccolo de Masi | 55,230 | 9,690 | | Inder Singh | 80,480 | 17,150 | | Wendy Thomas | 74,210 | 36,197 | | Harry You | 55,230 | 9,690 |
PAY VERSUS PERFORMANCE
PAY VERSUS PERFORMANCE The following tables and related disclosures have been prepared in accordance with Item 402(v) of Regulation S-K, and do not necessarily reflect the economic benefit actually earned, received, or realized by our NEOs, the method by which the compensation committee makes compensation determinations, or how the compensation committee views the link between the Company’s performance and compensation for NEOs. For example, a significant portion of “compensation actually paid” relates to changes in fair value of unvested awards over the course of each year, and the ultimate value realized by NEOs from unvested equity awards is not determined until the awards vest. For further information on our executive compensation program and the compensation committee’s decision-making process in determining and approving our NEOs compensation, see the section above titled “–Compensation Discussion and Analysis.”
PAY VERSUS PERFORMANCE
| Year | Summary Compensation Table Total for PEO(1) | Compensation Actually Paid to PEO(2) | Average Summary Compensation Table Total for Non-PEO NEOs(3) | Average Compensation Actually Paid to Non-PEO NEOs(4) | Value of Initial Fixed $100 Investment Based On: | | Net Loss (thousands)(7) | Revenue (thousands)(8) | | | | | | | Total Shareholder Return(5) | Peer Group Total Shareholder Return(6) | | | | 2023 | $1,338,675 | $27,789,873 | $7,703,267 | $17,333,958 | $134.67 | $64.84 | $(157,771) | $22,042 | | 2022 | $8,482,288 | $(41,018,462) | $5,911,916 | $3,280,217 | $37.50 | $58.05 | $(48,511) | $11,131 | | 2021 | $364,500 | $24,903,634 | $10,252,472 | $25,618,719 | $181.52 | $102.93 | $(106,186) | $2,099 |
PAY VERSUS PERFORMANCE
| (1) The dollar amounts reported are the amounts of total compensation reported for Mr. Chapman, our principal executive officer (“PEO”) for each corresponding year in the “Total” column of the Summary Compensation Table. See the section above titled “–Executive Compensation–Summary Compensation Table.” |
PAY VERSUS PERFORMANCE
| (2) The dollar amounts reported represent the amount of “compensation actually paid” to Mr. Chapman, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual amount of compensation earned by or paid to Mr. Chapman during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to Mr. Chapman’s total compensation for each year to determine the compensation actually paid: |
PAY VERSUS PERFORMANCE
| Year | Reported Summary Compensation Table Total for PEO | Reported Value of Equity Awards(a) | Equity Award Adjustments(b) | Compensation Actually Paid to PEO | | 2023 | $1,338,675 | $(413,054) | $26,864,252 | $27,789,873 | | 2022 | $8,482,288 | $(7,718,738) | $(41,782,012) | $(41,018,462) | | 2021 | $364,500 | $— | $24,539,134 | $24,903,634 |
PAY VERSUS PERFORMANCE
| (a) The reported value of equity awards represents the grant date fair value of equity awards as reported in the “Stock Awards” and “Option Awards” columns in the Summary Compensation Table for the applicable year. |
PAY VERSUS PERFORMANCE
| (b) The equity award adjustments for each applicable year include the addition (or subtraction, as applicable) of the following: (i) the year-end fair value of any equity awards granted in the applicable year that are outstanding and unvested as of the end of the year; (ii) the amount of change as of the end of the applicable year (from the end of the prior fiscal year) in fair value of any awards granted in prior years that are outstanding and unvested as of the end of the applicable year; (iii) for awards that are granted and vest in same applicable year, the fair value as of the vesting date; (iv) for awards granted in prior years that vest in the applicable year, the amount equal to the change as of the vesting date (from the end of the prior fiscal year) in fair value; (v) for awards granted in prior years that are determined to fail to meet the applicable vesting conditions during the applicable year, a deduction for the amount equal to the fair value at the end of the prior fiscal year; and (vi) the dollar value of any dividends or other earnings paid on stock or option awards in the applicable year prior to the vesting date that are not otherwise reflected in the fair value of such award or included in any other component of total |
PAY VERSUS PERFORMANCE
| compensation for the applicable year. The amounts deducted or added in calculating the equity award adjustments are as follows: |
PAY VERSUS PERFORMANCE
| Year | Year End Fair Value of Equity Awards | Year-Over- Year Change in Fair Value of Outstanding and Unvested Equity Awards | Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Year | Year-Over- Year Change in Fair Value of Equity Awards Granted in Prior Years that Vested in the Year | Fair Value at the End of the Prior Year of Equity Awards that Failed to Meet Vesting Conditions in the Year | Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation | Total Equity Award Adjustments | | 2023 | $413,054 | $11,881,105 | $— | $14,570,093 | $— | $— | $26,864,252 | | 2022 | $3,036,544 | $(30,362,467) | $548,964 | $(15,005,053) | $— | $— | $(41,782,012) | | 2021 | $— | $13,477,486 | $— | $11,061,648 | $— | $— | $24,539,134 |
PAY VERSUS PERFORMANCE
| (3) The dollar amounts reported represent the average of the amounts reported for the Company’s Non-PEO NEOs in the “Total” column of the Summary Compensation Table in each applicable year. The NEOs included for purposes of calculating the average amounts in each applicable year are as follows: (i) for 2023, Thomas Kramer, Rima Alameddine, Jungsang Kim, and Chris Monroe; (ii) for 2022, Rima Alameddine and Laurie Babinski; and (iii) for 2021, Thomas Kramer and Jungsang Kim. |
PAY VERSUS PERFORMANCE
| (4) The dollar amounts reported represent the average amount of “compensation actually paid” to the Non-PEO NEOs, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the Non-PEO NEOs during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to average total compensation for the Non-PEO NEOs for each year to determine the compensation actually paid, using the same methodology described above in Note 2: |
PAY VERSUS PERFORMANCE
| Year | Average Reported Summary Compensation Table Total for Non-PEO NEOs | Average Reported Value of Equity Awards | Average Equity Award Adjustments(a) | Average Compensation Actually Paid to Non-PEO NEOs | | 2023 | $7,703,267 | $(7,069,086) | $16,699,777 | $17,333,958 | | 2022 | $5,911,916 | $(5,730,905) | $3,099,206 | $3,280,217 | | 2021 | $10,252,472 | $(10,020,193) | $25,386,440 | $25,618,719 |
PAY VERSUS PERFORMANCE
| (a) The amounts deducted or added in calculating the total average equity award adjustments are as follows: |
PAY VERSUS PERFORMANCE
| Year | Average Year End Fair Value of Equity Awards | Year-Over- Year Average Change in Fair Value of Outstanding and Unvested Equity Awards | Average Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Year | Year-Over-Year Average Change in Fair Value of Equity Awards Granted in Prior Years that Vested in the Year | Average Fair Value at the End of the Prior Year of Equity Awards that Failed to Meet Vesting Conditions in the Year | Average Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation | Total Average Equity Award Adjustments | | 2023 | $6,093,040 | $7,556,407 | $74,498 | $3,564,500 | $(588,668) | $— | $16,699,777 | | 2022 | $3,003,473 | $— | $95,733 | $— | $— | $— | $3,099,206 | | 2021 | $19,396,434 | $1,634,038 | $3,527,982 | $827,986 | $— | $— | $25,386,440 |
PAY VERSUS PERFORMANCE
| (5) Total Shareholder Return (“TSR”) is calculated by dividing the difference between the Company’s share price at the end and the beginning of the measurement period by the Company’s share price at the beginning of the measurement period. |
PAY VERSUS PERFORMANCE
| (6) Represents weighted peer group TSR of the compensation peer group for the applicable year, weighted according to the respective companies’ stock market capitalization at the beginning of each period for which |
PAY VERSUS PERFORMANCE
| a return is indicated. Our compensation peer group for 2023 was comprised of the companies shown above in the section titled “–Compensation Discussion and Analysis —Executive Compensation Peer Group for Fiscal 2023 Summary Compensation Table.” |
PAY VERSUS PERFORMANCE
| (7) Represents the net loss as reported in the Company’s Annual Report on Form 10-K for the applicable year. |
PAY VERSUS PERFORMANCE
| (8) While the Company uses numerous financial and non-financial performance measures for the purpose of evaluating performance for the Company’s compensation programs, the Company has determined that revenue is the financial performance measure that, in the Company’s assessment, represents the most important performance measure (that is not otherwise required to be disclosed in the table) used by the company to link compensation actually paid to the Company’s NEOs, for the most recently completed fiscal year, to company performance. |
Compensation Actually Paid and Cumulative TSR
Compensation Actually Paid and Cumulative TSR The following chart reflects the relationship between the PEO and Average NEOs compensation actually paid (per the SEC’s definition), the Company’s TSR and the TSR Peer Group for the applicable year.
Compensation Actually Paid and Net Loss
Compensation Actually Paid and Net Loss The following chart reflects the relationship between the PEO and Average NEOs compensation actually paid, the Company’s net loss for the applicable year.
Compensation Actually Paid and Revenue
Compensation Actually Paid and Revenue The following chart reflects the relationship between the PEO and Average NEOs compensation actually paid and the Company’s revenue for the applicable year.