DEF 14A of TransMedics Group, Inc.
Filed Apr 10, 2025 · FY20240001193125-25-077974
Solicitation of Proxies
Solicitation of Proxies Our Board is making this solicitation of proxies for the Annual Meeting. We will bear all costs of such solicitation, including the cost of preparing and distributing this Proxy Statement and the enclosed form of proxy and including the cost of hosting the virtual meeting. After the initial distribution of this Proxy Statement, proxies may be solicited by mail, telephone, or personally by directors, officers, employees or agents of the Company. Brokerage houses and other custodians, nominees and fiduciaries will be requested to forward soliciting materials to beneficial owners of shares held by them for the accounts of beneficial owners, and we will pay their reasonable out-of-pocket expenses.
Solicitation of Proxies
| 4 | TransMedics Group, Inc. 2025 Proxy Statement |
Solicitation of Proxies
Our Board currently consists of eight (8) directors. In accordance with the terms of our restated articles of organization (“Articles of Organization”) and second amended and restated bylaws (“Bylaws”), all of our directors serve for one-year terms and are elected annually. We are nominating the eight (8) current directors listed below for re-election. If re-elected, each of these eight (8) nominees will serve on our Board until the 2026 annual meeting of shareholders (“2026 Annual Meeting of Shareholders”), or until his or her successor is duly elected and qualified in accordance with our Articles of Organization and Bylaws, or his or her earlier death, resignation or removal. Below is certain information concerning our Board’s nominees for election at the 2025 Annual Meeting. The biographies of each of the nominees below contain information regarding the experiences, qualifications, attributes or skills that caused the Nominating and Corporate Governance Committee and our Board to determine that the person should be re-elected as a director of the Company. Following the director biographies is information concerning our corporate governance structure, including descriptions of the standing committees of our Board, namely our Audit Committee (“Audit Committee”), Compensation Committee (“Compensation Committee”) and Nominating and Corporate Governance Committee (“Nominating and Corporate Governance Committee”). The directors serving on each committee are listed in the descriptions below. Our directors may also serve on other committees of our Board and the board of directors of the Company’s subsidiaries that are not required to be described by this Proxy Statement and which are therefore not identified in the information below. Elsewhere in this Proxy Statement you will find information concerning the number of shares of our common stock that are beneficially owned by each of our directors (see “Security Ownership of Certain Beneficial Owners and Management”) and information regarding the compensation of our directors (see “Non-Employee Director Compensation”). We urge you to review all of this information when deciding how to vote on Proposal 1. Our Board recommends that you vote FOR all eight (8) of the nominees named below. The following persons have been nominated for election to our Board:
Solicitation of Proxies
| Name | Year First Elected as Director | Position | | Waleed H. Hassanein, M.D. | 1998 | President and Chief Executive Officer; Director | | James R. Tobin | 2011 | Director; Chairperson of the Board | | Edward M. Basile | 2016 | Director; Chairperson of the Nominating and Corporate Governance Committee | | Thomas J. Gunderson | 2016 | Director; Chairperson of the Compensation Committee | | Edwin M. Kania, Jr. | 2003 | Director | | Stephanie Lovell | 2021 | Director | | Merilee Raines | 2021 | Director; Chairperson of the Audit Committee | | David Weill, M.D. | 2019 | Director |
Solicitation of Proxies
| TransMedics Group, Inc. 2025 Proxy Statement | 5 |
Solicitation of Proxies
| Waleed H. Hassanein, M.D. | Director since: August 1998 |
Solicitation of Proxies
Waleed H. Hassanein, M.D., age 56, our founder, has served as our President and Chief Executive Officer and as a member of our Board since August 1998. Prior to founding TransMedics, Inc., Dr. Hassanein completed a three-year cardiac surgery research fellowship at West Roxbury VA Medical Center and Brigham and Women’s Hospital, a Harvard Medical School affiliate. Prior to his research fellowship, Dr. Hassanein completed two years of general surgery residency at Georgetown University Medical Center. Dr. Hassanein received a M.D. degree from Georgetown University in 1993. Prior to transferring to Georgetown University, Dr. Hassanein attended Cairo University School of Medicine from 1985 to 1989, and holds a General Certificate of Education from the University of London. We believe that Dr. Hassanein is qualified to serve on our Board because of his extensive experience in the medical field and his extensive knowledge of our Company based on his role as founder and President and Chief Executive Officer.
Solicitation of Proxies
| James R. Tobin | Director since: July 2011 |
Solicitation of Proxies
James R. Tobin, age 80, has served as Chairperson of our Board since July 2011. Mr. Tobin is the retired President and CEO of Boston Scientific Corporation, a medical device company, where he served from 1999 to 2009. Prior to Boston Scientific, Mr. Tobin was the President and CEO of Biogen Inc., and, from 1994 to 1997, its President and Chief Operating Officer. Before Biogen, Mr. Tobin spent 22 years with Baxter International Inc., rising from Financial Analyst to President and Chief Operating Officer. Mr. Tobin currently serves as a director of Globus Medical Inc., a public company, for which he serves as lead director, Lyra Therapeutics, a public company, and Xenter, Inc., a private company. Mr. Tobin has also previously served on the boards of Impulse Dynamics, from 2021 to 2023, and Oxford Immunotec, Inc., from 2014 to 2021, among others. Mr. Tobin received a Bachelor’s Degree from Harvard College and an MBA from Harvard Business School. Mr. Tobin also served as Lieutenant in the U.S. Navy. We believe that Mr. Tobin is qualified to serve on our Board because of his decades of experience as President and Chief Executive Officer or Chief Operating Officer of three large biotechnology and medical device companies.
Solicitation of Proxies
| Edward M. Basile | Director since: February 2016 |
Solicitation of Proxies
Edward M. Basile, age 77, has served as a member of our Board since February 2016. He is currently retired. During his 25-year tenure with the law firm King & Spalding LLP, Mr. Basile served as Chair of the firm’s FDA and Life Sciences Practice and on the firm’s Policy and Compensation Committees. Mr. Basile’s law practice included representing large, medium and small medical device, pharmaceutical, and biotechnology companies before the U.S. Food and Drug Administration. Mr. Basile also served in the Chief Counsel’s Office of FDA as Associate Chief Counsel for Drugs & Biologics and Associate Chief Counsel for Enforcement from 1975 to 1985. Mr. Basile received a Bachelor’s Degree in mechanical engineering from Lafayette College and a J.D. from George Washington University Law School. We believe that Mr. Basile is qualified to serve on our Board because of his decades of experience representing medical device, pharmaceutical and biotechnology companies.
Solicitation of Proxies
| 6 | TransMedics Group, Inc. 2025 Proxy Statement |
Solicitation of Proxies
| Thomas J. Gunderson | Director since: August 2016 |
Solicitation of Proxies
Thomas J. Gunderson, age 74, has served as a member of our Board since August 2016. Mr. Gunderson has served as Chair of the Board of Directors at the Minneapolis Heart Institute Foundation from 2015 to 2020 and 2024 to present, as Executive in Residence at the University of Minnesota’s Medical Industry Leadership Institute from 2016 to present, as a member of the Board of Directors of Merit Medical Systems, Inc. from 2017 to present, as a member of American Heart Association Science and Technology Accelerator Committee from 2015 to 2017 and as managing director and senior research analyst at Piper Jaffray (with a focus on medical technology companies) from 1992 to 2016. We believe that Mr. Gunderson is qualified to serve on our Board because of his more than 25 years of substantive experience in the medical device industry, his seasoned perspective on the challenges, trends and opportunities of publicly-traded medical device manufacturers, and understanding of our competitive position within its industry, as well as his strong background in financial and economic analysis and valuable insights regarding business development and acquisition opportunities.
Solicitation of Proxies
| Edwin M. Kania, Jr. | Director since: December 2003 |
Solicitation of Proxies
Edwin M. Kania, Jr., age 67, has served as a member of our Board since December 2003. Mr. Kania is the managing partner of FarField Partners, a personal venture capital investment and advisory firm. Previously, Mr. Kania was co-founder of Flagship Pioneering and served as the firm’s initial chairman between 2001 and 2014 and as a managing partner through 2020. He is presently a partner emeritus. He was also managing partner of the predecessor OneLiberty Funds that were an early lead investor in our Company. During Mr. Kania’s 40+ years in the venture capital industry, he has served on the boards of numerous privately and publicly held companies. Mr. Kania received a Bachelor’s Degree in physics from Dartmouth College and an MBA from Harvard Business School. We believe that Mr. Kania is qualified to serve on our Board because of his significant experience investing in and then serving as a board member of numerous life science companies, including several that have emerged as significant revenue businesses.
Solicitation of Proxies
| Stephanie Lovell | Director since: March 2021 |
Solicitation of Proxies
Stephanie Lovell, age 65, has served as a member of our Board since March 2021. Ms. Lovell served as the Executive Vice President, Medicare and Chief Legal Officer for Blue Cross Blue Shield of Massachusetts, Inc. (“BCBSMA”) from July 2015 to December 2021. Ms. Lovell previously served as the Senior Vice President and General Counsel of BCBSMA from December 2011 to July 2015. Prior to BCBSMA, Ms. Lovell was the Senior Vice President of Administration and General Counsel for Boston Medical Center from March 2007 to December 2011. She also previously served as the First Assistant Attorney General in the Massachusetts Office of the Attorney General and as the Executive Director for the Massachusetts State Ethics Commission. Ms. Lovell currently serves as a director of Accompany Health, a private company, and Devoted Health Group, Inc., also a private company. Ms. Lovell previously served as a director of Cyclerion Therapeutics, Inc. and The Partnership Inc., each until her resignation in 2023. Ms. Lovell also served as a director of the New England Law Foundation and as a trustee of the Massachusetts Taxpayers Foundation, each until her resignation in 2021. She also is a member of the investment committee of Goodwill Industries of Massachusetts. Ms. Lovell received a Bachelor’s Degree in philosophy from Hamilton College and a J.D. from Boston University School of Law. We believe that Ms. Lovell is qualified to serve on our Board because of her experience in the healthcare payer and reimbursement markets, as well as government and regulatory affairs.
Solicitation of Proxies
| TransMedics Group, Inc. 2025 Proxy Statement | 7 |
Solicitation of Proxies
| Merilee Raines | Director since: January 2021 |
Solicitation of Proxies
Merilee Raines, age 69, has served as a member of our Board since January 2021. Ms. Raines served as Chief Financial Officer of IDEXX Laboratories, Inc. from October 2003 until her retirement in May 2013. Prior to becoming Chief Financial Officer, Ms. Raines held several management positions with IDEXX Laboratories, including Corporate Vice President of Finance, Vice President and Treasurer of Finance, Director of Finance, and Controller. IDEXX Laboratories develops, manufactures, and distributes diagnostic and information technology-based products and services primarily for companion animals, livestock, poultry, water quality and food safety, and human point of care diagnostics. Ms. Raines has served on the board of directors of Watts Water Technologies, Inc. since 2011, and serves on its audit committee and nominating and corporate governance committee. Ms. Raines has served on the board of directors of Ocular Therapeutics, Inc. since September 2021 and serves on its audit committee. Ms. Raines previously served on the board of directors of Benchmark Electronics, Inc., from 2018 until 2021. Ms. Raines has also served on the boards of directors of several private companies, including Excelitas Technologies Corporation since 2018 and previously Dead River Company from 2018 until 2021. Ms. Raines received a Bachelor’s Degree in mathematics from Bowdoin College and an MBA from the University of Chicago. We believe that Ms. Raines is qualified to serve on our Board because of her extensive financial expertise and experience as an executive and director of public companies.
Solicitation of Proxies
| David Weill, M.D. | Director since: April 2019 |
Solicitation of Proxies
David Weill, M.D., age 61, has served as a member of our Board since April 2019. Dr Weill has served since 2016 as Principal of the Weill Consulting Group, a biomedical consulting group focusing on organ transplantation and lung disease. Dr. Weill has been involved in the transplant and advanced lung disease fields for over 20 years, directing clinical programs and providing care to those afflicted with significant lung diseases. Dr. Weill served as Director of the Lung and Heart-Lung Transplant Program at Stanford University Medical Center from 2005 until 2016 and is the former Director of the Stanford Center for Advanced Lung Diseases. Dr. Weill received a Bachelor of Arts Degree from Tulane University and a M.D. degree from Tulane University Medical School. He completed his Internship and Residency in Internal Medicine at Parkland Hospital, University of Texas Southwestern and his Fellowship in Pulmonary and Critical Care Medicine and Lung Transplantation at the University of Colorado at Denver and Health Sciences Center. We believe that Dr. Weill is qualified to serve on our Board because of his experience at a major medical research institute and his expertise in organ transplantation and pulmonary disease.
Compensation Committee
| • | reviewing and making recommendations to the Board with respect to director compensation; |
Non-Employee Director Compensation
Non-Employee Director Compensation The following table presents the total compensation for each person who served as a non-employee member of our Board during 2024. Other than as set forth in the table and described more fully below, we did not pay any compensation to any of the other non-employee members of our Board. Dr. Hassanein, our President and Chief Executive Officer, receives no compensation for his services as a director and, as a result, is not included in the table below. The compensation received by Dr. Hassanein for his services as an employee in the fiscal year ended December 31, 2024 is described in the “Summary Compensation Table” and the accompanying narrative description.
Non-Employee Director Compensation
| Name | Fees earned or paid in cash ($)(1) | Stock awards ($)(2) | Option awards ($)(3) | All Other Compensation ($)(4) | Total ($) | | James R. Tobin | 100,000 | 100,672 | 100,185 | — | 300,857 | | Edward M. Basile | 70,500 | 100,672 | 100,185 | 724 | 272,081 | | Thomas J. Gunderson | 75,000 | 100,672 | 100,185 | 3,008 | 278,865 | | Edwin M. Kania, Jr. | 60,000 | 100,672 | 100,185 | — | 260,857 | | Stephanie Lovell | 62,500 | 100,672 | 100,185 | — | 263,357 | | Merilee Raines | 77,500 | 100,672 | 100,185 | 952 | 279,309 | | David Weill, M.D. | 62,500 | 100,672 | 100,185 | — | 263,357 |
Non-Employee Director Compensation
| (1) The amounts reported in this column represent the aggregate cash compensation paid to each of our non-employee directors in respect of the fiscal year ended December 31, 2024. |
Non-Employee Director Compensation
| 14 | TransMedics Group, Inc. 2025 Proxy Statement |
Non-Employee Director Compensation
| (2) The amounts reported in this column represent the aggregate grant date fair value of RSUs granted to our non-employee directors during the fiscal year ended December 31, 2024, computed in accordance with FASB ASC 718, excluding the effect of estimated forfeitures. For RSUs, the grant date fair value was calculated by multiplying the closing price of the underlying shares of our common stock on the date of grant by the number of RSUs granted. The assumptions used to value the RSUs for this purpose are set forth in Note 10 to our financial statements filed with our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. These amounts do not represent the actual amounts paid to or realized by the director for these awards. |
Non-Employee Director Compensation
| (3) The amounts reported in this column represent the aggregate grant date fair value of an option to purchase our common stock granted to each of our non-employee directors in the fiscal year ended December 31, 2024, computed in accordance with FASB ASC 718, excluding the effect of estimated forfeitures. The assumptions used to value this option for this purpose are set forth in Note 10 to our financial statements filed with our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. These amounts do not represent the actual amounts paid to or realized by the director for these awards. |
Non-Employee Director Compensation
| (4) The amounts reported in this column represent travel expense reimbursements issued to certain of our non-employee directors. |
Non-Employee Director Compensation
As of December 31, 2024, our non-employee directors held options to purchase the number of shares of common stock set forth in the table below.
Non-Employee Director Compensation
| Name | Number of Unvested RSUs | Shares Subject to Outstanding Options | | James R. Tobin | 732 | 46,004 | | Edward M. Basile | 732 | 51,789 | | Thomas J. Gunderson | 732 | 65,289 | | Edwin M. Kania, Jr. | 732 | 30,070 | | Stephanie Lovell | 732 | 26,263 | | Merilee Raines | 732 | 36,820 | | David Weill, M.D. | 732 | 40,070 |
Non-Employee Director Compensation Policy
Non-Employee Director Compensation Policy In 2024, following a review of our non-employee director compensation policy with Pearl Meyer, our Compensation Committee recommended and the Board approved an increase in the annual cash retainer for the members of the Board from $40,000 to $50,000, an increase in the annual cash retainer for the Board Chairperson from $85,000 to $95,000, and an increase in the aggregate grant date fair value of the initial appointment equity awards for non-employee directors to approximately $300,000, in each case, effective as of March 2024. No other changes were made to non-employee director compensation during 2024. Following these updates, the following structure was used to compensate our non-employee directors in 2024:
Non-Employee Director Compensation Policy
| | Board or Committee Chairperson | Board or Committee Member | | Annual cash retainer | $95,000 | $50,000 | | Additional annual cash retainer for Audit Committee | $20,000 | $10,000 | | Additional annual cash retainer for Compensation Committee | $15,000 | $7,500 | | Additional annual cash retainer for Nominating and Corporate Governance Committee | $10,500 | $5,000 | | Annual equity award | Stock options and RSUs, each with an aggregate grant date fair value of approximately $90,000 | | | Initial appointment equity award | Stock options and RSUs, each with an aggregate grant date fair value of approximately $150,000 | |
Non-Employee Director Compensation Policy
| TransMedics Group, Inc. 2025 Proxy Statement | 15 |
Non-Employee Director Compensation Policy
Cash retainers are payable in arrears in four equal quarterly installments, provided that the amount of such payment is prorated for any portion of such quarter that the director was not serving on the Board or the relevant committee thereof. The committee chair cash retainers are provided in lieu of committee member cash retainers. The number of shares subject to each stock option and RSU award is determined by dividing the target award values by the average closing price of our common stock over a 30-day period preceding the grant date (and, for options, a Black-Scholes ratio). Annual grants of RSUs and stock options vest in full on the first anniversary of the grant date, and initial appointment RSUs and stock options vest as to one-third (1/3) on the first anniversary of the grant date with the remaining portion vesting monthly over the following 24 months. Each such grant of RSUs and stock options vests in full upon the director’s death or disability or a change in control and, in each case, vesting is generally subject to the non-employee director’s continued service through the applicable vesting date. Each non-employee director was granted 732 RSUs and an option to purchase 1,154 shares of our common stock on May 23, 2024.
Non-Employee Director Compensation Policy
| 16 | TransMedics Group, Inc. 2025 Proxy Statement |
Non-Employee Director Compensation Policy
Proposal 2 Advisory Vote on Executive Compensation We are seeking your vote, on a non-binding advisory basis, to approve the compensation of our named executive officers as described in the Compensation Discussion and Analysis, the compensation tables and related narrative disclosure contained in this Proxy Statement, which is commonly referred to as a “say on pay” vote. Because your “say on pay” vote is advisory, it will not be binding on the Compensation Committee or the Board. However, the Compensation Committee and the Board will review the “say on pay” voting results and take them into consideration when making future decisions regarding executive compensation. The philosophy and principal objectives of our executive compensation programs are to attract, fairly compensate, appropriately incentivize, and retain superior executive talent in a manner that aligns their long-term interests with those of our shareholders. Our executive compensation program is designed to be:
Non-Employee Director Compensation Policy
| • | Competitively Positioned: Target compensation should be competitive with that being offered to individuals in comparable roles at other companies with which we compete for talent to ensure that we attract and retain the best people to lead our success. Our Compensation Committee generally targets the median of the market for target compensation opportunities but can set compensation for executives above or below that level based on factors such as individual and Company performance, an executive’s role and responsibilities relative to executives in similar positions in the market, and an executive’s actual and potential impact on the successful execution of our strategy, among others. |
Non-Employee Director Compensation Policy
| • | Performance-Driven and Shareholder-Aligned: A meaningful portion of total compensation should be variable and linked to the achievement of specific short- and long-term performance objectives and designed to drive shareholder value creation. |
Non-Employee Director Compensation Policy
| • | Responsibly Governed: Decisions about compensation should be guided by best-practice governance standards and rigorous processes that encourage prudent decision-making. |
Non-Employee Director Compensation Policy
Consistent with this philosophy, a significant portion of the total compensation opportunity for each of our executives is based on our performance. Shareholders are urged to read the Compensation Discussion and Analysis section of this Proxy Statement, which discusses how our compensation program implements our compensation philosophy. The Compensation Committee and the Board believe that these policies and procedures are effective in implementing our compensation philosophy and in achieving the goals of our executive compensation program.
2024 Executive Compensation Highlights
2024 Executive Compensation Highlights Our executive compensation program has three primary elements: base salary, annual cash bonuses, and long-term equity compensation. Each of these compensation elements serves a specific purpose in our compensation strategy. Base salary is an essential component to any market-competitive compensation program. Annual cash bonuses reward the achievement of short-term goals, while long-term equity compensation drives our NEOs to focus on long-term sustainable shareholder value creation. Based on our performance and consistent with the design of our program, the Compensation Committee made the following executive compensation decisions for fiscal year 2024:
2024 Executive Compensation Highlights
| • | Annual cash bonuses: Based on our 2024 revenue of $441.5 million (119.3% of our target revenue of $370 million, and an 83% increase compared to our revenue in 2023) and achievement of six out of eight non-financial strategic objectives, our Compensation Committee determined that each named executive officer would receive the maximum annual bonus for which he was eligible in 2024, except that Mr. Ranganath’s annual bonus was capped at 100% of target consistent with Company internal practices for new leaders. For more information, please see section “2024 EXECUTIVE COMPENSATION PROGRAM IN DETAIL — Annual Bonuses” below. |
2024 Executive Compensation Highlights
| • | Long-term equity compensation: We granted long-term incentives using a mix of 50% stock options and 50% restricted stock units (“RSUs”), based on grant date fair value using a 30-day average closing price, to each of our named executive officers. We also continued working with Pearl Meyer to analyze our equity granting practices, including the potential introduction of performance-based equity, and have decided to maintain our current approach at this time. We continue to be committed to evolving our equity mix over time to align with market best-practices for our industry and support our business and leadership talent retention objectives. For more information, please see section “2024 EXECUTIVE COMPENSATION PROGRAM IN DETAIL — Equity Incentive Awards” below. |
2024 Executive Compensation Highlights
| • | Using a compensation peer group that appropriately reflects our size and growth trajectory; |
2024 Executive Compensation Highlights
| • | Having an annual cash bonus program driven by a formulaic measurement of revenue, with a payout cap of 200% of target annual bonus awards, and a threshold performance level; |
2024 Executive Compensation Highlights
| • | Granting long-term incentive awards using a mix of equity that includes full value awards (RSUs) and stock options; and |
2024 Target Compensation At-A-Glance (Pay Mix)
| * Excludes Mr. Hernandez, due to his hire in December 2024, and Mr. Ranganath, since he was not eligible to receive a long-term equity incentive award in 2024 due to his hire date. As a result, their 2024 compensation was not representative. |
Independent Compensation Consultant
Independent Compensation Consultant The Compensation Committee believes that independent advice is important in developing and overseeing our executive compensation program. The Compensation Committee has engaged Pearl Meyer to provide consulting services in relation to executive and director compensation decisions. Pearl Meyer reports directly to the Compensation Committee and only provides services to us on such matters as needed and as directed solely by the Compensation Committee. These services include providing guidance on trends in CEO, executive, and non-employee director compensation; the development of the specific components of our executive compensation program; and a competitive market assessment of our executive compensation program, including the composition of our compensation peer group. Our Compensation Committee has determined, based on its analysis and in light of all relevant factors, that the work of Pearl Meyer has not created any conflicts of interest, and that Pearl Meyer is independent pursuant to the independence standards set forth in the Nasdaq listing standards promulgated pursuant to Section 10C of the Exchange Act.
Independent Compensation Consultant
| 24 | TransMedics Group, Inc. 2025 Proxy Statement |
Use of Peer Group and Market Data
Use of Peer Group and Market Data 2024 Compensation Peer Group. Our Compensation Committee uses peer group and other market data as a reference point to gauge the reasonableness of our executive compensation decisions and the general competitiveness of our executive compensation program in the market and to assist it in determining the type and amount of compensation that we pay. For purposes of setting compensation levels for 2024, our Compensation Committee, working in consultation with Pearl Meyer, selected companies operating in the healthcare equipment/medical device industry or the early commercial biotechnology/pharmaceutical and diagnostic industry with a comparable market capitalization (targeting companies with a market values between approximately 0.33x and 3.0x our market value) and revenue (targeting companies with revenues between approximately 0.33x and 3.0x our current/projected revenue). Our Compensation Committee also qualitatively evaluated each prospective peer group company based on business focus and corporate strategy to identify companies in a similar space, to the extent possible, and seeks to maintain year-over-year continuity in our peer group by maintaining flexibility in applying the foregoing criteria, particularly in uncertain market conditions. Based on the analysis provided by Pearl Meyer, the Compensation Committee approved the following changes for our 2024 peer group, compared to the 2023 peer group, to better align the peer group with the Company’s valuation and growth trajectory:
Use of Peer Group and Market Data
| Additions | | Removals | | | | Inari Medical, Inc. | | BioLife Solutions, Inc. | | | iRhythm Technologies, Inc. | | Butterfly Network, Inc. | | | NovoCure Limited | | CareDx, Inc. | | | Pacific Biosciences of California, Inc. | | Pulmonx Corporation | | | Shockwave Medical, Inc. | | SomaLogic, Inc. | | | | | Twist Bioscience Corporation |
Use of Peer Group and Market Data
With these changes, the compensation peer group companies selected by our Compensation Committee for 2024 executive compensation purposes are listed below.
Use of Peer Group and Market Data
| 2024 Peer Group | | | | | AtriCure, Inc. | Axonics, Inc. | Establishment Labs Holdings Inc. | Glaukos Corporation | | Inari Medical, Inc. | iRhythm Technologies, Inc. | Nevro Corp. | NovoCure Limited | | OrthoPediatrics Corp. | Outset Medical, Inc. | Pacific Biosciences of California, Inc. | PROCEPT BioRobotics Corporation | | Shockwave Medical, Inc. | Silk Road Medical, Inc | STAAR Surgical Company | Treace Medical Concepts, Inc. |
Use of Peer Group and Market Data
| TransMedics Group, Inc. 2025 Proxy Statement | 25 |
Annual Bonuses
Annual Bonuses Our Compensation Committee believes that a significant portion of our named executive officers’ cash compensation should be tied to our performance. Each of our named executive officers is eligible to receive an annual bonus based on the achievement of certain financial and strategic performance goals related to revenue growth, and regulatory and business goals. Target annual bonus opportunities are initially determined and thereafter reviewed annually by our Compensation Committee based on the same factors as described above for base salary. Actual awards can range from 0% to 200% of target depending on performance.
Annual Bonuses
| 26 | TransMedics Group, Inc. 2025 Proxy Statement |
Annual Bonuses
For 2024, our Compensation Committee reviewed the target annual bonus opportunities for our named executive officers and, considering the factors described above and relevant market data, increased the target annual bonuses for Drs. Hassanein and Khayal and Messrs. Corcoran and Gordon to be more competitive within our compensation peer group. The 2024 target annual bonus opportunities for our named executive officers were as follows:
Annual Bonuses
| Named Executive Officer | 2024 Target Annual Bonus Opportunity (As a Percentage of Base Salary) | | Waleed H. Hassanein, M.D. | 100% | | Gerardo Hernandez(1) | n/a | | Tamer Khayal, M.D. | 60% | | Nicholas Corcoran | 45% | | Anil Ranganath | 45% | | Stephen Gordon | 60% |
Annual Bonuses
| 1) | Mr. Hernandez joined the Company effective December 2, 2024. He was not eligible for an annual bonus in 2024. |
2024 Performance Goals
2024 Performance Goals Our Compensation Committee determines the performance metrics and goals for our annual bonus program in the beginning of each year based on input from management and our annual business plan. Our Compensation Committee strives to set challenging, yet achievable, performance goals that will promote the achievement of short-term business objectives that are important to our annual business plan. The performance metrics for annual bonuses include financial and non-financial strategic goals that reflect our growth strategy and purpose. In 2024, our Compensation Committee determined bonus payouts based on a formulaic measurement of revenue performance against budget and additionally considered our achievement of non-financial strategic goals when reviewing performance, as follows:
2024 Performance Goals
| • | Threshold: In order for any bonus to be earned, we must achieve 2024 revenue of at least $314.5M (85% of our 2024 revenue target) and three out of four of our “impact factor one” goals. “Impact factor two” goals are used to measure functional and individual performance and are considered by our Compensation Committee in determining whether any adjustments are appropriate. |
2024 Performance Goals
| • | Target: Bonuses will be earned at 100% of target if our 2024 target revenue goal of $370M is achieved. |
2024 Performance Goals
| • | Maximum Bonus: Bonuses will be earned at 200% of target if our 2024 revenue is achieved at or above $435M, which is 180% growth over the prior year. |
2024 Performance Goals
| TransMedics Group, Inc. 2025 Proxy Statement | 27 |
2024 Performance Goals
If our revenue was between the threshold and target or the target and maximum performance thresholds, the amount of the bonus earned would be determined based on linear interpolation between such thresholds. Our Compensation Committee may also consider individual performance contributions and retains the discretion to adjust bonus payouts downward or upward based on its assessment of each named executive officer’s contribution to the Company during the year, as well as the achievement of strategic goals. The specific metrics and goals that were approved by our Compensation Committee for 2024, as well as the actual achievement results, are outlined below:
2024 Performance Goals
| 2024 Performance Metrics and Goals | | Results | | Revenue | Revenue target of $370M | $441.5M | | Impact Factor One | Scaling TransMedics Aviation to a minimum of 16 planes by September 30, 2024 | Met | | | Initiation of a US Lung clinical program/trial by December 31, 2024 | Not Met | | | Completion of ERP upgrade and HRIS implementation by December 31, 2024 | Met | | | PMA submission of 2 new assembly improvements for current OCS modules by December 31, 2024 | Met | | Impact Factor Two | Sustained EBITDA positive for a minimum of 2 quarters in 2024 | Met | | | FDA submission of new OCS boards with integrated lactate and ABG sensors by December 31, 2024 | Not Met | | | Complete development of OCS Connect II & OCS Cloud Connectivity by December 31, 2024 | Met | | | Supply chain to control management of all inventory at NOP hubs by December 31, 2024 | Met |
2024 Performance Goals
Our 2024 revenue of $441.5 million was an 83% increase in revenue over 2023 and above our maximum level performance goals, we achieved three out of four impact factor one goals, and we achieved three out of four of the impact factor two goals. As a result, our Compensation Committee determined that each named executive officer, other than Mr. Ranganath, would receive a bonus of 200% of target for 2024. Consistent with our internal compensation practices for new leaders and given his June 2023 start date, our Compensation Committee determined that Mr. Ranganath was still in the early stages of his leadership in developing the internal legal function for the Company with additional opportunities to further his direct contribution to core strategic initiatives. As a result, his 2024 annual bonus was capped at 100% of his target annual bonus. Our Compensation Committee did not apply any further discretion to any calculated bonus payout. The resulting bonus payouts for our named executive officers are for 2024 are set forth below:
2024 Performance Goals
| Named Executive Officer(1) | 2024 Annual Base Salary | 2024 Target Annual Bonus Opportunity (as a % of Salary) | 2024 Target Annual Bonus Opportunity | 2024 Actual Annual Bonus Payout (as a % of Target) | Actual Annual Bonus Payout | | Waleed H. Hassanein, M.D. | $700,000 | 100% | $700,000 | 200% | $1,400,000 | | Tamer Khayal, M.D. | $481,500 | 60% | $288,900 | 200% | $577,800 | | Nicholas Corcoran | $435,000 | 45% | $195,750 | 200% | $391,500 | | Anil Ranganath | $400,000 | 45% | $180,000 | 100% | $180,000 | | Stephen Gordon | $477,000 | 60% | $286,200 | 200% | $572,400 |
2024 Performance Goals
| (1) Mr. Hernandez joined the Company effective December 2, 2024. He was not eligible for an annual bonus in 2024. |
2024 Performance Goals
| 28 | TransMedics Group, Inc. 2025 Proxy Statement |
Equity Incentive Awards
Equity Incentive Awards Our Compensation Committee believes that in order to appropriately incentivize our named executive officers to create shareholder value, a significant portion of our named executive officers’ compensation should be in the form of equity-based compensation. Our equity-based compensation program is designed to align the interests of our executives and shareholders by promoting stock ownership by our executives and senior management, tying compensation realized to stock price performance and encouraging retention. For 2024, our Compensation Committee granted equity incentive awards using a mix of 50% stock options and 50% RSUs, calculated based on target grant date fair value using the average closing price over the 30-day period preceding the grant date.
Equity Incentive Awards
| Equity Vehicle | Weighting | Features | | Stock Options | 50% | • Stock options are intended to align the interests of award recipients with those of shareholders since stock options only deliver value if our stock price appreciates after they are granted. • Stock options generally vest on a monthly basis over four years, generally subject to the named executive officer’s continued employment with us; for new hires, stock options generally vest 25% on the first anniversary of the grant date and the remaining shares vest in equal monthly installments over three years thereafter. | | RSUs | 50% | • RSUs are intended to support our talent retention objectives while also aligning the interests of award recipients with those of shareholders since the value of RSUs is based on the value of our stock price. • RSUs generally vest on an annual basis over three years (four years, for new hires), generally subject to the named executive officer’s continued employment with us. |
Equity Incentive Awards
Our Compensation Committee determined the target value of each named executive officer’s 2024 annual equity awards based on competitive market data, as described above, our strong performance in 2023, and each named executive officer’s past individual performance and expected future contributions. The target value for Mr. Hernandez’s new hire equity award granted in connection with his hire in December 2024 was determined based on these same factors. Based on the size of Mr. Ranganath’s new hire equity award and his June 2023 start date, consistent with our internal compensation practices for new leaders, Mr. Ranganath was not eligible for annual equity awards in 2024. The total target award grant date fair values for each other named executive officer for 2024 as approved by the Compensation Committee, and calculated using the average closing price over the 30-day period preceding the grant date, are shown in the table below:
Equity Incentive Awards
| Named Executive Officer | Stock Options Target Grant Date Value | RSUs Target Grant Date Value | Total Target Grant Date Value | | Waleed H. Hassanein, M.D. | $3,212,500 | $3,212,500 | $6,425,000 | | Gerardo Hernandez | $1,000,000 | $1,000,000 | $2,000,000 | | Tamer Khayal, M.D. | $1,060,000 | $1,060,000 | $2,120,000 | | Nicholas Corcoran | $1,000,000 | $1,000,000 | $2,000,000 | | Anil Ranganath | n/a | n/a | n/a | | Stephen Gordon | $1,060,000 | $1,060,000 | $2,120,000 |
Equity Incentive Awards
| TransMedics Group, Inc. 2025 Proxy Statement | 29 |
Equity Incentive Awards
The number of shares subject to each award was determined by dividing the target award values by the average closing price of our common stock over a 30-day period preceding the grant date (and, for options, a Black-Scholes ratio). Values shown in the table above may differ from the values shown in the Summary Compensation Table and the Grants of Plan-Based Awards Table. For Mr. Hernandez, awards in the table above reflect equity grants made in connection with the commencement of his employment. Subject to continued service, the stock options granted to Mr. Hernandez vest as to 25% of the underlying shares on the first anniversary of the grant date and as to the remaining shares in equal monthly installments over three years thereafter, and the RSUs granted to Mr. Hernandez vest as to 25% of the RSUs on each of the first four anniversaries of the grant date. For the other named executive officers who received equity awards in 2024, the stock options granted vest in equal monthly installments over four years and the RSUs granted vest in equal annual installments over three years, subject to continued service.
CFO Transition
CFO Transition In December 2024 we hired Mr. Hernandez as our Chief Financial Officer. In connection with his hire, our Compensation Committee made the compensation decisions described above, and Mr. Hernandez entered into a retention agreement with us, which is described under “Potential Payments Upon Termination or Change in Control” below. In connection with his transition from Chief Financial Officer on December 2, 2024, Mr. Gordon entered into a transition agreement with the Company, which superseded and replaced his prior retention agreement, originally established in 2015 and amended in 2020. Prior to finalizing the transition agreement, the Compensation Committee engaged an independent third-party in 2024 to conduct a comprehensive analysis of severance benefits relative to the Company’s peer group and found that the severance benefits provided under Mr. Gordon’s retention agreement were below market compared to peers, in part because the retention agreement was originally entered into when the Company was a relatively small private company. The transition agreement reflects updated severance terms designed to align with market practices and the Company’s current executive severance framework, as well as to drive a seamless leadership transition. It also recognizes Mr. Gordon’s long service and exceptional contributions to the Company. Under the terms of the transition agreement, Mr. Gordon will continue as a non-executive employee through March 31, 2025, followed by a consulting period through March 31, 2026. Mr. Gordon’s transition from Chief Financial Officer and termination of employment would have entitled him to receive severance payments and benefits under his retention agreement due on a termination without cause or good reason resignation. Under the transition agreement, while Mr. Gordon was employed as a non-executive employee, he continued to receive his base salary and remained eligible to receive his 2024 annual bonus. Mr. Gordon’s outstanding equity awards continued to vest in accordance with their terms during the period in which Mr. Gordon remained employed with the Company and will continue to vest in accordance with their terms during the period in which Mr. Gordon serves as a non-employee senior advisor for the Company. As a consultant, Mr. Gordon will also receive an annual fee of $10,000. Subject to Mr. Gordon’s execution of a release of claims and continued compliance with restrictive covenants, in connection with his termination of employment on March 31, 2025, Mr. Gordon will receive (i) an amount equal to the sum of his annual base salary ($477,000) plus his highest annual bonus during the preceding three years ($572,400) and (ii) Company-provided group health insurance benefits for up to 18 months. If Mr. Gordon’s consulting services are terminated by the Company without cause prior to March 31, 2026, any outstanding equity awards that would have continued to vest through March 31, 2026 (had he continued to provide services through such date) will accelerate upon such termination. The full terms of Mr. Gordon’s transition agreement are included in our Annual Report on Form 10-K, filed on February 27, 2025. Under Generally Accepted Accounting Principles (GAAP) and SEC disclosure requirements, the full accounting value of the severance benefits provided in Mr. Gordon’s transition agreement is recognized in fiscal year 2024, even though Mr. Gordon will not receive any payments until after March 31, 2025. As a result, the total amount of severance payable under the transition agreement is included in the “All Other Compensation” column of the Summary Compensation Table for 2024, and modification charges relating to his equity awards are included in the “Stock Awards” and “Option Awards” columns of the Summary Compensation Table for 2024.
Change in Control and Severance Benefits
Change in Control and Severance Benefits We have entered into offer letters with Mr. Hernandez, Dr. Khayal, Mr. Corcoran and Mr. Ranganath that set forth the initial terms and conditions of employment, and we have entered into retention agreements with Dr. Hassanein, Mr. Hernandez, Dr. Khayal, and Mr. Ranganath that provide for severance payments and benefits in connection with certain terminations of employment. Mr. Corcoran’s offer letter provides for severance payments in connection with certain terminations of employment. In addition, certain of the equity awards granted to our named executive officers would vest in connection with a qualifying termination of employment following a change in control. Prior to his termination of employment, we had also been party to a retention agreement with Mr. Gordon and, in connection with his transition we entered into a transition agreement with Mr. Gordon that provides for his entitlement to certain severance payments and benefits. The severance payments and benefits for all of our named executive officers are more fully described below under “Potential Payments upon Termination or Change in Control.” Our Compensation Committee believes that reasonable severance payments and benefits are necessary to attract and retain executives and are important in incentivizing them to pursue a change in control transaction if it is in the best interests of our shareholders even if it creates uncertainty for them.
Practices Related to the Grant of Certain Equity Awards
Practices Related to the Grant of Certain Equity Awards The Company generally maintains a structured equity grant timing process designed to ensure compliance with applicable securities laws, corporate governance best practices, and the avoidance of material nonpublic information (“MNPI”) in granting equity awards. The Compensation Committee generally grants annual equity-based awards to our executive officers in February of each year, in connection with our annual compensation review and approval process, although the exact timing may change from year to year. Our Compensation Committee may also grant equity awards, including RSUs and stock options, at different times of the year for new hires and in connection with promotions, or grants made for retention or other purposes.
Practices Related to the Grant of Certain Equity Awards
| 32 | TransMedics Group, Inc. 2025 Proxy Statement |
Practices Related to the Grant of Certain Equity Awards
Stock option exercise prices are set at the closing price of the Company’s common stock on the grant date, in accordance with the Company’s equity plan and applicable securities regulations. This process is designed to prevent any appearance of opportunistic grant timing and to ensure that equity awards are made in a manner that reflects long-term stockholder value creation. Our Compensation Committee does not grant equity awards in anticipation of the release of MNPI and we have not timed the disclosure of MNPI for the purpose of affecting the value of executive compensation. During 2024, the Company granted the following stock options to named executive officers during a period beginning four business days before and ending one business day after the filing of any Company periodic report on Form 10-Q or Form 10-K, or the filing or furnishing of any Company current report on Form 8-K (other than a current report on Form 8-K disclosing a material new option award grant under Item 5.02(e) of that form) that disclosed any MNPI:
Practices Related to the Grant of Certain Equity Awards
| Name | Grant date | Number of securities underlying the award | Exercise price of the award | Grant date fair value of the award | 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 | | Waleed H. Hassanein, M.D. | 2/23/2024 | 56,645 | $83.14 | 3,040,613 | 6.70% | | Stephen Gordon | 2/23/2024 | 18,690 | $83.14 | 1,003,249 | 6.70% | | Nicholas Corcoran | 2/23/2024 | 17,632 | $83.14 | 946,458 | 6.70% | | Tamer Khayal, M.D. | 2/23/2024 | 18,690 | $83.14 | 1,003,249 | 6.70% |
Summary Compensation Table
Summary Compensation Table The following table sets forth the compensation awarded to, earned by, or paid to our named executive officers during our fiscal years ended December 31, 2024, and, if applicable, December 31, 2023 and December 31, 2022.
Summary Compensation Table
| Name and Principal Position | Year | Salary ($)(1) | Bonus ($) | Stock Awards ($)(2) | Option Awards ($)(3) | Non-Equity Incentive Plan Compensation ($)(4) | All Other Compensation ($)(5) | Total ($) | | Waleed H. Hassanein, M.D. President and Chief Executive Officer | 2024 | 688,462 | — | 3,055,811 | 3,040,613 | 1,400,000 | 14,250 | 8,199,136 | | | 2023 | 633,846 | — | 2,467,645 | 2,472,929 | 1,170,000 | 13,650 | 6,758,070 | | | 2022 | 575,192 | — | — | 1,825,900 | 886,770 | — | 3,287,862 | | Gerardo Hernandez(6) Chief Financial Officer | 2024 | 17,308 | — | 870,416 | 869,748 | — | — | 1,757,472 | | Tamer Khayal, M.D. Chief Commercial Officer | 2024 | 474,231 | — | 1,008,239 | 1,003,249 | 577,800 | 14,250 | 3,077,769 | | | 2023 | 445,962 | — | 864,258 | 866,142 | 450,000 | 4,146 | 2,630,508 | | | 2022 | 421,875 | — | — | 379,787 | 326,903 | — | 1,128,565 | | Nicholas Corcoran(7) Senior Vice President of Supply Chain and Operations | 2024 | 421,154 | — | 951,205 | 946,458 | 391,500 | 14,250 | 2,724,567 | | | 2023 | 338,942 | 100,000 | 851,765 | 853,596 | 300,000 | 73,129 | 2,517,432 | | Anil Ranganath(8) Senior Vice President, General Counsel and Corporate Secretary | 2024 | 400,000 | — | — | — | 180,000 | 14,250 | 594,250 | | | 2023 | 215,385 | — | 892,987 | 893,789 | 180,000 | 5,181 | 2,187,342 | | Stephen Gordon(9) Former Chief Financial Officer | 2024 | 470,769 | — | 1,825,608 | 2,792,805 | 572,400 | 1,102,980 | 6,764,562 | | | 2023 | 445,965 | — | 864,258 | 866,142 | 450,000 | 13,650 | 2,640,015 | | | 2022 | 417,715 | — | — | 379,787 | 326,903 | — | 1,124,405 |
Summary Compensation Table
| (1) The amounts reported in this column include contributions made by the named executive officer to our 401(k) plan, which is described below. |
Summary Compensation Table
| (2) The amounts reported in this column represent the aggregate grant date fair value of RSUs granted during the fiscal years ended December 31, 2024 and December 31, 2023, as applicable, computed in accordance with FASB ASC 718, excluding the effect of estimated forfeitures. These amounts do not represent the actual amounts paid to or realized by the named executive officer for these awards. The amount reported in this column for 2024 for Mr. Gordon also includes the incremental fair value, as computed under FASB ASC Topic 718, related to adjustments to his RSU awards made in connection with his transition from employment as our Chief Financial Officer ($817,369), as described in more detail below under “Potential Payments Upon Termination or Change in Control — Gordon Transition.” This incremental compensation charge does not reflect additional amounts actually received by Mr. Gordon. For |
Summary Compensation Table
| 34 | TransMedics Group, Inc. 2025 Proxy Statement |
Summary Compensation Table
| RSUs, the grant date fair value was calculated by multiplying the closing price of the underlying shares of our common stock on the date of grant by the number of RSUs granted. The assumptions used to value the RSUs for this purpose are set forth in Note 10 to our financial statements filed with our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 and Note 10 to our financial statements filed with our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. No RSUs were granted to our named executive officers prior to 2023. |
Summary Compensation Table
| (3) The amounts reported in this column represent the aggregate grant date fair value of options to purchase our common stock granted during the fiscal years ended December 31, 2024, December 31, 2023 and December 31, 2022, as applicable, computed in accordance with FASB ASC 718, excluding the effect of estimated forfeitures. These amounts do not represent the actual amounts paid to or realized by the named executive officer for these awards. The amount reported in this column for 2024 for Mr. Gordon also includes the incremental fair value, as computed under FASB ASC Topic 718, related to adjustments to his option awards made in connection with his transition from employment as our Chief Financial Officer ($1,789,556), as described in more detail below under “Potential Payments Upon Termination or Change in Control — Gordon Transition.” The assumptions used to value the options for this purpose are set forth in Note 10 to our financial statements filed with our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, Note 10 to our financial statements filed with our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, and Note 10 to our financial statements filed with our Annual Report on Form 10-K for the fiscal year ended December 31, 2022. |
Summary Compensation Table
| (4) The amounts reported in this column represent annual bonuses paid for the fiscal years ended December 31, 2024, December 31, 2023 and December 31, 2022, as applicable. See “Compensation Discussion and Analysis — Annual Cash Incentive Bonuses” above for additional details. |
Summary Compensation Table
| (5) The amounts reported in this column for the fiscal year ended December 31, 2024 represent the following items: |
Summary Compensation Table
| Name and Principal Position | Cash Severance ($)(a) | Benefits Continuation ($)(b) | Company 401(k) Matching Contributions ($) | Group Term Life Insurance Premium Paid by Company ($) | Total ($) | | Waleed H. Hassanein, M.D. | — | — | 13,800 | 450 | 14,250 | | Gerardo Hernandez | — | — | — | — | — | | Tamer Khayal, M.D. | — | — | 13,800 | 450 | 14,250 | | Nicholas Corcoran | — | — | 13,800 | 450 | 14,250 | | Anil Ranganath | — | — | 13,800 | 450 | 14,250 | | Stephen Gordon | 1,049,400 | 39,330 | 13,800 | 450 | 1,102,980 |
Summary Compensation Table
| (a) The amount reported in this column for Mr. Gordon represents the cash severance payments to which Mr. Gordon is entitled to receive in connection with his termination of employment on March 31, 2025, which was accrued in 2024 when he transitioned from employment as our Chief Financial Officer but will not be paid until 2025 or 2026. For more information, see “Potential Payments Upon Termination or Change in Control — Gordon Transition.” |
Summary Compensation Table
| (b) The amount reported in this column for Mr. Gordon represents an amount equal to the Company’s monthly portion of the premium for Mr. Gordon’s medical benefits for 18 months, to which Mr. Gordon is entitled to receive in connection with his termination of employment on March 31, 2025, which was accrued in 2024 when he transitioned from employment as our Chief Financial Officer but will not be paid until 2025 or 2026. For more information, see “Potential Payments Upon Termination or Change in Control — Gordon Transition.” |
Summary Compensation Table
| (6) Mr. Hernandez commenced employment with us on December 2, 2024. |
Summary Compensation Table
| (7) Mr. Corcoran commenced employment with us on January 23, 2023. The amount reported in the Bonus column represents a signing bonus paid to Mr. Corcoran in connection with his commencing employment with us. |
Summary Compensation Table
| (8) Mr. Ranganath commenced employment with us on June 5, 2023. |
Summary Compensation Table
| (9) Mr. Gordon ceased to serve as our Chief Financial Officer as of December 2, 2024, on which date Mr. Gordon transitioned to non-executive employee role with us through March 31, 2025. From March 31, 2025 through March 31, 2026, Mr. Gordon is expected to serve as a senior advisor to our Chief Executive Officer as a non-employee consultant to the Company. |
Summary Compensation Table
| TransMedics Group, Inc. 2025 Proxy Statement | 35 |
Grants of Plan-Based Awards Table
Grants of Plan-Based Awards Table The following table sets forth information regarding plan-based awards made to each of our named executive officers during 2024.
Grants of Plan-Based Awards Table
| Name | Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | | | All Other Stock Awards: Number Of Shares of Stock or Units (#)(2) | All Other Option Awards: Number Of Securities Underlying Options (#)(3) | Exercise or Base Price Of Option Awards ($/Sh)(4) | Grant Date Fair Value Of Stock and Option Awards ($)(5) | | | | Threshold ($) | Target ($) | Maximum ($) | | | | | | Waleed H. Hassanein, M.D. | — | 560,000 | 700,000 | 1,400,000 | — | — | — | — | | | 2/23/2024 | — | — | — | — | 56,645 | 83.14 | 3,040,613 | | | 2/23/2024 | — | — | — | 36,755 | — | — | 3,055,811 | | Gerardo Hernandez | — | — | — | — | — | — | — | — | | | 12/9/2024 | — | — | — | — | 18,922 | 69.84 | 869,748 | | | 12/9/2024 | — | — | — | 12,463 | — | — | 870,416 | | Tamer Khayal, M.D. | — | 231,120 | 288,900 | 577,800 | — | — | — | — | | | 2/23/2024 | — | — | — | — | 18,690 | 83.14 | 1,003,249 | | | 2/23/2024 | — | — | — | 12,127 | — | — | 1,008,239 | | Nicholas Corcoran | — | 156,600 | 195,750 | 391,500 | — | — | — | — | | | 2/23/2024 | — | — | — | — | 17,632 | 83.14 | 946,458 | | | 2/23/2024 | — | — | — | 11,441 | — | — | 951,205 | | Anil Ranganath | — | 144,000 | 180,000 | 360,000 | — | — | — | — | | | — | — | — | — | — | — | — | — | | | — | — | — | — | — | — | — | — | | Stephen Gordon | — | 228,960 | 286,200 | 572,400 | — | — | — | — | | | 2/23/2024 | — | — | — | — | 18,690 | 83.14 | 1,003,249 | | | 2/23/2024 | — | — | — | 12,127 | — | — | 1,008,239 | | | —(6) | — | — | — | — | — | — | 2,606,925 |
Grants of Plan-Based Awards Table
| (1) Amounts represent the threshold, target and maximum annual cash bonus opportunities by our named executive officers under our annual bonus program. See “Compensation Discussion and Analysis — Annual Bonuses” above for additional details. Mr. Hernandez commenced employment with us in December 2024 and was therefore not eligible for an annual bonus for 2024. The actual amounts paid to our named executive officers under our annual bonus program for 2024 are set forth in the Non-Equity Incentive Plan Compensation of the Summary Compensation Table above. |
Grants of Plan-Based Awards Table
| (2) Except as noted in footnote 6 below, amounts represent the number of RSUs granted to our named executive officers in 2024. See “Compensation Discussion and Analysis — Equity Incentive Awards” above for additional details. |
Grants of Plan-Based Awards Table
| (3) Except as noted in footnote 6 below, amounts represent the number of shares of our common stock subject to stock options granted to our named executive officers in 2024. See “Compensation Discussion and Analysis — Equity Incentive Awards” above for additional details. |
Grants of Plan-Based Awards Table
| (4) Amounts represent the exercise price for the stock options granted to our named executive officers in 2024. |
Grants of Plan-Based Awards Table
| (5) Except as noted in footnote 6 below, these amounts represent the grant date fair value of RSUs or stock options, as applicable, granted in 2024, determined in accordance with FASB ASC Topic 718, disregarding the effect of forfeitures. These amounts do not represent the actual amounts paid to or realized by the named executive officer for these awards during 2024. For a more detailed description of the assumptions used for purposes of determining grant date fair value see Note 10 to the consolidated financial statements set forth in our Annual Report on Form 10-K for the year ended December 31, 2024. For RSUs, the grant date fair value was calculated by multiplying the closing price of the underlying shares of our common stock on the date of grant by the number of RSUs granted. |
Grants of Plan-Based Awards Table
| 36 | TransMedics Group, Inc. 2025 Proxy Statement |
Grants of Plan-Based Awards Table
| (6) Amount in this row for Mr. Gordon represents the incremental fair value of certain of Mr. Gordon’s RSU and stock option awards resulting from the modifications of the awards in connection with his transition and separation from employment, as discussed in more detail in footnotes 2 and 3 to the Summary Compensation Table. |
Outstanding Equity Awards at 2024 Year-End
Outstanding Equity Awards at 2024 Year-End The following table sets forth information concerning outstanding equity awards held by each of our named executive officers as of December 31, 2024.
Outstanding Equity Awards at 2024 Year-End
| | | Option Awards | | | Stock Awards | | | Named Executive Officer | 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 or Units of Stock that have not Vested ($)(1) | | Waleed H. Hassanein, M.D. | 265,714 | — | 16.00 | 4/30/2029 | — | — | | | 153,000 | — | 16.14 | 2/27/2030 | — | — | | | 297,083 | 12,917(2) | 38.46 | 2/24/2031 | — | — | | | 23,333 | 72,917(2) | 13.28 | 2/22/2032 | — | — | | | 26,200 | 30,965(2) | 66.10 | 2/20/2033 | — | — | | | — | — | — | — | 24,888(3) | 1,551,767 | | | 11,800 | 44,845(2) | 83.14 | 2/23/2034 | — | — | | | — | — | — | — | 36,755(4) | 2,291,674 | | Gerardo Hernandez | — | 18,922(5) | 69.84 | 12/9/2034 | — | — | | | — | — | — | — | 12,463(6) | 777,068 | | Tamer Khayal, M.D. | 2,917 | 2,917(2) | 38.46 | 2/24/2031 | — | — | | | 1,083 | 15,167(2) | 13.28 | 2/22/2032 | — | — | | | 1,251 | 10,847(2) | 66.10 | 2/20/2033 | — | — | | | — | — | — | — | 8,716(3) | 543,443 | | | 3,893 | 14,797(2) | 83.14 | 2/23/2034 | — | — | | | — | — | — | — | 12,127(4) | 756,118 | | Nicholas Corcoran | 1,644 | 10,278(7) | 66.10 | 2/20/2033 | — | — | | | — | — | — | — | 9,664(8) | 602,550 | | | 1,483 | 13,959(2) | 83.14 | 2/23/2034 | — | — | | | — | — | — | — | 11,441(4) | 713,346 | | Anil Ranganath | 1,226 | 9,194(9) | 93.88 | 8/1/2033 | — | — | | | — | — | — | — | 7,134(10) | 444,805 | | Stephen Gordon | 84 | — | 16.14 | 2/27/2030 | — | — | | | 12,500 | 2,917(2) | 38.46 | 2/24/2031 | — | — | | | 8,000 | 15,167(2) | 13.28 | 2/22/2032 | — | — | | | 4,175 | 10,847(2) | 66.10 | 2/20/2033 | — | — | | | — | — | — | — | 8,716(3) | 543,443 | | | 2,893 | 14,797(2) | 83.14 | 2/23/2034 | — | — | | | — | — | — | — | 12,127(4) | 756,118 |
Outstanding Equity Awards at 2024 Year-End
| TransMedics Group, Inc. 2025 Proxy Statement | 37 |
Outstanding Equity Awards at 2024 Year-End
| (1) Values for RSUs have been determined using the closing price of a share of our common stock as of December 31, 2024, the last trading day of 2024 ($62.35). |
Outstanding Equity Awards at 2024 Year-End
| (2) Options vest as to the underlying shares on a monthly basis over a four-year period from the grant date, which is ten years prior to the applicable expiration date listed in the table above, generally subject to continued service through each such vesting date. |
Outstanding Equity Awards at 2024 Year-End
| (3) RSUs vest as to one-third (1/3) of the RSUs on each of the first three anniversaries of February 20, 2023, generally subject to continued service through each such vesting date. |
Outstanding Equity Awards at 2024 Year-End
| (4) RSUs vest as to one-third (1/3) of the RSUs on each of the first three anniversaries of February 23, 2024, generally subject to continued service through each such vesting date. |
Outstanding Equity Awards at 2024 Year-End
| (5) Option vests as to 25% of the underlying shares on December 2, 2025, and as to the remainder of the underlying shares on a monthly basis over three years thereafter, generally subject to continued service through each such vesting date. |
Outstanding Equity Awards at 2024 Year-End
| (6) RSUs vest as to 25% of the RSUs on each of the first four anniversaries of December 2, 2024, generally subject to continued service through each such vesting date. |
Outstanding Equity Awards at 2024 Year-End
| (7) Option vested as to 25% of the underlying shares on January 23, 2024, and vests as to the remainder of the underlying shares on a monthly basis over three years thereafter, generally subject to continued service through each such vesting date. |
Outstanding Equity Awards at 2024 Year-End
| (8) RSUs vest as to 25% of the RSUs on each of the first four anniversaries of January 23, 2023, generally subject to continued service through each such vesting date. |
Outstanding Equity Awards at 2024 Year-End
| (9) Option vested as to 25% of the underlying shares on June 5, 2024, and vests as to the remainder of the underlying shares on a monthly basis over three years thereafter, generally subject to continued service through each such vesting date. |
Outstanding Equity Awards at 2024 Year-End
| (10) RSUs vest as to 25% of the RSUs on each of the first four anniversaries of June 5, 2023, generally subject to continued service through each such vesting date. |
Option Exercises and Stock Vested
Option Exercises and Stock Vested The following table sets forth certain information for each of our named executive officers regarding stock options exercised and stock awards vested during 2024.
Option Exercises and Stock Vested
| | Option Awards | | Stock Awards | | | Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($)(1) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($)(2) | | Waleed H. Hassanein, M.D. | 198,750 | 24,642,728 | 12,444 | 1,102,663 | | Gerardo Hernandez | — | — | — | — | | Tamer Khayal, M.D. | 132,125 | 10,194,814 | 4,359 | 386,251 | | Nicholas Corcoran | 10,000 | 1,062,782 | 3,222 | 273,644 | | Anil Ranganath | 4,289 | 222,899 | 2,378 | 321,244 | | Stephen Gordon | 95,060 | 6,725,779 | 4,359 | 386,251 |
Option Exercises and Stock Vested
| (1) The amounts reported in this column are based on the per share closing price of a share of our common stock on the Nasdaq Stock Market on the date the applicable stock options were exercised and represent the difference between such closing price and the exercise price of the stock option, multiplied by the number of shares acquired upon exercise. |
Option Exercises and Stock Vested
| (2) The amounts reported in this column are based on the per share closing price of a share of our common stock on the Nasdaq Stock Market on the date the applicable stock awards vested, multiplied by the number of shares acquired upon vesting. |
Pension Benefits and Nonqualified Deferred Compensation
Pension Benefits and Nonqualified Deferred Compensation None of our named executive officers participated in or received benefits from a pension plan or from a nonqualified deferred compensation plan during 2024 or in any prior year.
Pension Benefits and Nonqualified Deferred Compensation
| 38 | TransMedics Group, Inc. 2025 Proxy Statement |
Potential Payments Upon Termination or Change in Control
Potential Payments Upon Termination or Change in Control We have entered into offer letters with Mr. Hernandez, Dr. Khayal, Mr. Corcoran and Mr. Ranganath that set forth the initial terms and conditions of the executive’s employment with us. We have also entered into a retention agreement with each of Dr. Hassanein, Dr. Khayal and Mr. Ranganath that provides for severance payments and benefits in the event the named executive officer’s employment is terminated in certain circumstances. Mr. Corcoran’s offer letter provides for severance payments and benefits in connection with certain terminations of employment. Prior to his termination of employment, we had been party to an offer letter and a retention agreement, as amended, with Mr. Gordon. In connection with his transition and termination of employment, we entered into a transition and separation agreement with Mr. Gordon (the “Transition Agreement”). In addition, each of our named executive officers has entered into an invention and non-disclosure agreement and a non-competition and non-solicitation agreement with us. The material terms of these agreements are summarized below. As used in the summary below, the terms “cause,” “disability,” “good reason” and “change in control” have the meanings set forth in the applicable agreement. Dr. Hassanein. Pursuant to his retention agreement, Dr. Hassanein is entitled to severance payments and benefits in the event we terminate his employment other than for cause (and other than due to his death or disability) or if Dr. Hassanein resigns for good reason. If his employment terminates in such circumstances, Dr. Hassanein will be entitled to receive (i) an amount equal to the sum of his highest annual base salary during the preceding three years and his highest annual bonus during the preceding three years, payable in 12 monthly installments; (ii) Company-provided benefits for up to 12 months; (iii) an additional 12 months of service credit for purposes of eligibility for any retiree benefits; and (iv) any accrued but unpaid compensation and benefits, including a prorated annual bonus for the year in which his employment terminates, based on Dr. Hassanein’s annual bonus for the preceding year, subject, in each case, to his execution of a release of claims and compliance with the material provisions of any employment, consulting, advisory, nondisclosure, non-competition or similar agreement with us. If his employment terminates in such circumstances either in connection with or in anticipation of, or within 24 months following, a change in control, then, in lieu of the payments and benefits described above, Dr. Hassanein will be entitled to receive (A) an amount equal to one and one-half (1.5) times the sum of his highest annual base salary during the preceding three years and his highest annual bonus during the preceding three years, payable in a lump sum; (B) Company-provided benefits for up to 18 months; (C) an additional 18 months of service credit for purposes of eligibility for any retiree benefits; (D) accelerated vesting of all of his then-outstanding and unvested stock options, restricted stock, and other equity-based awards; and (E) any accrued but unpaid compensation and benefits, including a prorated annual bonus for the year in which his employment terminates, based on Dr. Hassanein’s annual bonus for the preceding year. Mr. Hernandez. Pursuant to his retention agreement, Mr. Hernandez is entitled to severance payments and benefits in the event we terminate his employment other than for cause (and other than due to his death or disability) or if Mr. Hernandez resigns for good reason. If his employment terminates in such circumstances after the 12-month anniversary of the date he commenced employment and prior to a change in control, Mr. Hernandez will be entitled to receive (i) an amount equal to the sum of his highest annual base salary during the preceding three years and his highest annual bonus during the preceding three years (reduced by any noncompetition payments payable to Mr. Hernandez during the same period), payable in 12 monthly installments; (ii) Company-provided group health insurance benefits for up to 12 months; and (iii) any accrued but unpaid compensation and benefits, including a prorated annual bonus for the year in which his employment terminates, based on Mr. Hernandez’s annual bonus for the preceding year, subject, in each case, to his execution of a release of claims and compliance with the material provisions of any employment, consulting, advisory, nondisclosure, noncompetition or similar agreement with us. If his employment terminates in such circumstances either in connection with or in anticipation of, or within 24 months following, a change in control, then, in lieu of the payments and benefits described above, Mr. Hernandez will be entitled to receive (A) an amount equal to the sum of (x) one and one-half (1.5) times his highest annual base salary during the preceding three years, (y) his highest annual bonus during the preceding three years, and (z) his target annual bonus for the year in which his employment terminates, payable in a lump sum; (B) Company-provided group health insurance benefits for up to 18 months; (C) accelerated vesting of all of his then-outstanding and unvested stock options, restricted stock units, and other equity-based awards (with any performance-based equity awards vesting at target levels); and (D) any accrued but unpaid compensation and benefits, including a prorated annual bonus for the year in which his employment terminates, based on Mr. Hernandez’s annual bonus for the preceding year.
Potential Payments Upon Termination or Change in Control
| TransMedics Group, Inc. 2025 Proxy Statement | 39 |
Potential Payments Upon Termination or Change in Control
Dr. Khayal. Pursuant to his retention agreement, Dr. Khayal is entitled to severance payments and benefits in the event we terminate his employment other than for cause (and other than due to his death or disability) or if Dr. Khayal resigns for good reason. If his employment terminates in such circumstances, Dr. Khayal will be entitled to receive (i) an amount equal to three-fourths (.75) times the sum of his highest annual base salary during the preceding three years and his highest annual bonus during the preceding three years, payable in nine monthly installments; (ii) Company-provided benefits for up to nine months; (iii) an additional nine months of service credit for purposes of eligibility for any retiree benefits; and (iv) any accrued but unpaid compensation and benefits, including a prorated annual bonus for the year in which his employment terminates, based on Dr. Khayal’s annual bonus for the preceding year, subject, in each case, to his execution of a release of claims and compliance with the material provisions of any employment, consulting, advisory, nondisclosure, non-competition or similar agreement with us. If his employment terminates in such circumstances either in connection with or in anticipation of, or within 24 months following, a change in control, then, in lieu of the payments and benefits described above, Dr. Khayal will be entitled to receive (A) an amount equal to the sum of his highest annual base salary during the preceding three years and his highest annual bonus during the preceding three years, payable in a lump sum; (B) Company-provided benefits for up to 12 months; (C) an additional 12 months of service credit for purposes of eligibility for any retiree benefits; (D) accelerated vesting of all of his then-outstanding and unvested stock options, restricted stock, and other equity-based awards; and (E) any accrued but unpaid compensation and benefits, including a prorated annual bonus for the year in which his employment terminates, based on Dr. Khayal’s annual bonus for the preceding year. Mr. Corcoran. Pursuant to his offer letter, Mr. Corcoran is entitled to severance payments and benefits in the event we terminate his employment other than for cause (and other than due to his death or disability) or if Mr. Corcoran resigns for good reason. If his employment terminates in such circumstances after the 12-month anniversary of the date he commenced employment and prior to a change in control, Mr. Corcoran will be entitled to receive (i) continued base salary for six months (reduced by any noncompetition payments payable to Mr. Corcoran during the same period), payable on regularly scheduled pay periods; (ii) any earned but unpaid annual bonus for the preceding year; (iii) Company-provided group health insurance benefits for up to six months; and (iv) accrued but unpaid salary and pay for accrued but unused vacation, subject, in each case, to his execution of a release of claims and compliance with the material provisions of any employment, consulting, advisory, nondisclosure, non-competition or similar agreement with us. If his employment terminates in such circumstances after the 12-month anniversary of the date he commenced employment and within 24 months following a change in control, then, in lieu of the payments and benefits described above, Mr. Corcoran will be entitled to receive (A) continued base salary for nine months (reduced by any noncompetition payments payable to Mr. Corcoran during the same period), payable on regularly scheduled pay periods; (B) his target annual bonus for the year in which his employment terminates; (C) Company-provided group health insurance benefits for up to nine months; (D) accelerated vesting of all of his then-outstanding and unvested stock options and other equity-based awards (with any performance-based equity awards vesting at target levels); and (E) accrued but unpaid salary and pay for accrued but unused vacation. Mr. Ranganath. Pursuant to his retention agreement, Mr. Ranganath is entitled to severance payments and benefits in the event we terminate his employment other than for cause (and other than due to his death or disability) or if Mr. Ranganath resigns for good reason. If his employment terminates in such circumstances after the 12-month anniversary of the date he commenced employment and prior to a change in control, Mr. Ranganath will be entitled to receive (i) an amount equal to three-fourths (.75) times the sum of his highest annual base salary during the preceding three years and his highest annual bonus during the preceding three years (reduced by any noncompetition payments payable to Mr. Ranganath during the same period), payable in nine monthly installments; (ii) Company-provided group health insurance benefits for up to nine months; and (iii) any accrued but unpaid compensation and benefits, including a prorated annual bonus for the year in which his employment terminates, based on Mr. Ranganath’s annual bonus for the preceding year, subject, in each case, to his execution of a release of claims and compliance with the material provisions of any employment, consulting, advisory, nondisclosure, noncompetition or similar agreement with us. If his employment terminates in such circumstances either in connection with or in anticipation of, or within 24 months following, a change in control, then, in lieu of the payments and benefits described above, Mr. Ranganath will be entitled to receive (A) an amount equal to the sum of his highest annual base salary during the preceding three years and his highest annual bonus during the preceding three years, payable in a lump sum; (B) Company-provided group health insurance benefits for up to 12 months; (C) accelerated vesting of all of his then-outstanding and unvested stock options, restricted stock units, and other equity-based awards (with any performance-based equity awards vesting at target levels); and (D) any accrued but unpaid compensation and benefits, including a prorated annual bonus for the year in which his employment terminates, based on Mr. Ranganath’s annual bonus for the preceding year.
Potential Payments Upon Termination or Change in Control
| 40 | TransMedics Group, Inc. 2025 Proxy Statement |
Potential Payments Upon Termination or Change in Control
Mr. Gordon. In connection with Mr. Gordon’s transition, we entered into the Transition Agreement, as described in further detail under “CFO Transition” above, which provided for severance payments and benefits in connection with his termination of employment. If Mr. Gordon’s employment terminated for any reason other than a termination of employment without cause prior to March 31, 2025, he would have been entitled to receive the severance payments and benefits set forth in his prior retention agreement for the applicable type of termination. Restrictive Covenants. Each of our named executive officers has entered into an invention assignment and non-disclosure agreement and a noncompetition and non-solicitation agreement with us that contain covenants relating to the disclosure of proprietary and confidential information and the assignment of inventions, and non-competition, no-hire and employee and customer non-solicitation covenants that apply for one year following the termination of the named executive officer’s employment with us. 280G Better Of Provision. Each of the retention agreements described above provides that we will not be obligated to provide any payments or benefits to the named executive officer that would constitute “excess parachute payments’’ within the meaning of Section 280G of the Code, unless such payments and benefits would result in a greater after-tax amount to the named executive officer than if the payments and benefits were reduced so that no amount was subject to the excise tax imposed with respect to such payments (to the extent applicable).
Potential Payments Upon Termination or Change in Control
| TransMedics Group, Inc. 2025 Proxy Statement | 41 |
CEO Pay Ratio
CEO Pay Ratio Under SEC rules, we are required to disclose the ratio of our CEO’s annual total compensation to the median of the annual total compensation of all of our other employees. We determined that the 2024 median of the annual total compensation of all of our employees who were employed as of December 31, 2024, other than our CEO, Dr. Hassanein, was $141,564. Dr. Hassanein’s 2024 annual total compensation was $8,199,136 (as reported in our Summary Compensation Table above). Based on the foregoing, our estimate of the ratio of Dr. Hassanein’s annual total compensation to the median annual total compensation of all of our other employees was 58 to 1. As of December 31, 2024, our total population, excluding Dr. Hassanein, consisted of 727 employees located in the United States, France, Germany, Ireland, and Italy. Pursuant to SEC rules, we excluded all of our non-U.S. employees (1 employee located in France, 4 employees located in Germany, 1 employee located in Ireland, and 1 employee located in Italy) for purposes of identifying our median employee. After applying this exemption, the employee population, excluding Dr. Hassanein, used for purposes of identifying the median employee consisted of 720 employees. To identify the median employee, we used Box 5 W-2 data for all such 720 individuals (with the exception of Dr. Hassanein) employed by us on December 31, 2024, annualizing such data for those individuals employed by us for less than the full year of 2024. We then calculated the annual compensation of the median employee using the same methodology used to calculate Dr. Hassanein’s compensation for the Summary Compensation Table. We believe that the pay ratio reported above is a reasonable estimate calculated in a manner consistent with SEC rules based on our internal records and the methodology described above. The SEC rules for identifying the median employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices. Therefore, our ratio may not be comparable to the ratios disclosed by other companies based on a number of factors, including differences in employee populations, different geographic distributions of employees, and the nature of the companies’ businesses.
CEO Pay Ratio
| TransMedics Group, Inc. 2025 Proxy Statement | 43 |
Pay Versus Performance Disclosure
Pay Versus Performance Disclosure In accordance with rules adopted by the SEC pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, we provide the following disclosure regarding executive “Compensation Actually Paid” (“CAP”) and certain performance measures for the fiscal years listed below. The Compensation Discussion & Analysis (“CD&A”) describes the compensation setting process for our executive officers, which is done independently from the disclosure requirements.
Pay Versus Performance
Pay Versus Performance The following table provides the information required for our NEOs for each of the fiscal years ended December 31, 2024, December 31, 2023, December 31, 2022, December 31, 2021, and December 31, 2020 along with the required financial information required for each fiscal year. CAP is calculated in accordance with SEC rules and includes the increase or decrease in value of certain elements of compensation over each fiscal year, including compensation granted in a prior year. CAP does not correlate to the total amount of cash or equity compensation paid or received during each fiscal year. The calculations do not reflect the actual sale of stock underlying equity awards or the exercise of stock options by the executive, and the amount of compensation ultimately received may, in fact, be different from the CAP amounts disclosed in the table below:
Pay Versus Performance
| | | | | | Value of Initial Fixed $100 Investment Based On: | | | | | Year (1)(2) | Summary Compensation Table Total for PEO (3) | Compensation Actually Paid to PEO (3)(4)(5) | Average Summary Compensation Table Total for Non-PEO NEOs (3) | Average Compensation Actually Paid to Non-PEO NEOs (3)(4)(5) | Total Shareholder Return (6) | Peer Group Total Shareholder Return (7) | Net Income (Loss) (in millions) (8) | Revenue (in millions) (9) | | | $ | $ | $ | $ | $ | $ | $ | $ | | 2024 | 8,199,136 | 9,626,783 | 2,983,724 | 2,398,150 | 327.99 | 105.42 | 35.5 | 441.5 | | 2023 | 6,758,070 | 12,840,614 | 2,493,824 | 3,227,811 | 415.20 | 106.34 | (25.0) | 241.6 | | 2022 | 3,287,862 | 25,221,314 | 958,883 | 4,539,310 | 324.67 | 99.81 | (36.2) | 93.5 | | 2021 | 7,370,365 | 5,172,952 | 1,441,564 | 1,070,395 | 100.79 | 125.43 | (44.2) | 30.3 | | 2020 | 2,385,687 | 2,664,897 | 928,500 | 1,040,808 | 104.68 | 130.04 | (28.7) | 25.6 |
Pay Versus Performance
| (1) For all years reported, the principal executive officer (“PEO”) was Waleed H. Hassanein, M.D. |
Pay Versus Performance
| (2) Non-PEO NEOs reflect the following executives for each covered fiscal year: |
Pay Versus Performance
2024: Gerardo Hernandez, Tamer Khayal, M.D., Nicholas Corcoran, Anil Ranganath, Stephen Gordon; 2023: Stephen Gordon, Tamer Khayal, M.D., Nicholas Corcoran, Anil Ranganath; 2022: Stephen Gordon, Tamer Khayal, M.D., Miriam Provost, Laura Damme; 2021: Stephen Gordon, Tamer Khayal, M.D., Miriam Provost, Laura Damme; and 2020: Stephen Gordon, Tamer Khayal, M.D.
Pay Versus Performance
| 44 | TransMedics Group, Inc. 2025 Proxy Statement |
Pay Versus Performance
| (3) Deductions from, and additions to, total compensation in the Summary Compensation Table by year to calculate CAP are shown in the tables below. The amounts reflected for fiscal year 2023 have been revised from the amounts previously reported in last year’s Proxy Statement to reflect the correct Average Summary Compensation Table Total for our Non-PEO NEOs and to incorporate an inadvertent omission of certain tranches of outstanding stock option awards granted in a previous year that remained outstanding as of the end of fiscal year 2023. |
Pay Versus Performance
| | CAP to PEO | | | | | | | 2024 | 2023 | 2022 | 2021 | 2020 | | | $ | $ | $ | $ | $ | | Summary Compensation Table Total | 8,199,136 | 6,758,070 | 3,287,862 | 7,370,365 | 2,385,687 | | Adjustments for Stock and Option Awards | | | | | | | Adjustment for grant date fair values in the Summary Compensation Table | (6,096,424) | (4,940,574) | (1,825,900) | (6,377,940) | (1,445,960) | | Year-end fair value of unvested awards granted in the covered fiscal year | 3,958,387 | 5,365,601 | 10,641,357 | 2,075,714 | 1,671,287 | | Year-over-year difference of year-end fair values for unvested awards granted in prior years that remained outstanding at the covered fiscal year end | (2,382,164) | 3,440,246 | 8,789,191 | (136,012) | 67,306 | | Fair values at vest date for awards granted and vested in covered fiscal year | 971,689 | 532,735 | 1,647,831 | 949,688 | 312,077 | | Difference in fair values between prior year-end fair values and vest date fair values for awards granted in prior years and vesting in the covered fiscal year | 4,976,159 | 1,684,536 | 2,680,973 | 1,291,136 | (325,501) | | Compensation Actually Paid (as calculated) | 9,626,783 | 12,840,614 | 25,221,314 | 5,172,952 | 2,664,897 |
Pay Versus Performance
| | Average CAP to Non-PEO NEOs | | | | | | | 2024 | 2023 | 2022 | 2021 | 2020 | | | $ | $ | $ | $ | $ | | Summary Compensation Table Total | 2,983,724 | 2,493,824 | 958,883 | 1,441,564 | 928,500 | | Adjustments for Stock and Option Awards | | | | | | | Adjustment for grant date fair values in the Summary Compensation Table | (2,053,545) | (1,738,234) | (328,662) | (977,265) | (405,485) | | Year-end fair value of unvested awards granted in the covered fiscal year | 1,079,261 | 1,822,445 | 1,915,468 | 318,056 | 469,469 | | Year-over-year difference of year-end fair values for unvested awards granted in prior years that remained outstanding at the covered fiscal year end | (371,623) | 372,583 | 1,344,256 | (16,871) | 9,332 | | Fair values at vest date for awards granted and vested in covered fiscal year | 188,739 | 93,271 | 296,601 | 145,504 | 87,658 | | Difference in fair values between prior year-end fair values and vest date fair values for awards granted in prior years and vesting in the covered fiscal year | 571,594 | 183,922 | 352,765 | 159,408 | (48,666) | | Compensation Actually Paid (as calculated) | 2,398,150 | 3,227,811 | 4,539,310 | 1,070,395 | 1,040,808 |
Pay Versus Performance
| TransMedics Group, Inc. 2025 Proxy Statement | 45 |
Pay Versus Performance
| (4) The valuation of RSU awards included as part of CAP was based on the grant date closing price and the closing price on the applicable vesting date or fiscal year end. The following summarizes the valuation assumptions used for stock option awards included as part of CAP: |
Pay Versus Performance
| a. | Expected life of each stock option is based on the “simplified method” using an average of the remaining vesting period and remaining term, as of the applicable vesting date or fiscal year end. |
Pay Versus Performance
| b. | The exercise price is based on each grant date closing price and fair value is based on the closing price on the applicable vesting date or fiscal year end. |
Pay Versus Performance
| c. | Risk free rate is based on the Treasury Constant Maturity rate closest to the remaining expected life as of the applicable vesting date or fiscal year end. |
Pay Versus Performance
| d. | Historical volatility is based on the daily price history for each year of remaining expected life prior to each applicable vesting date or fiscal year end; closing prices are provided by S&P Capital IQ and are adjusted for dividends and splits. |
Pay Versus Performance
| e. | Annual dividend yield on each applicable vesting date or fiscal year end is assumed to be zero. |
Pay Versus Performance
| (5) The following table illustrates the valuation assumptions as of the vesting date for stock options that vested in each of the covered fiscal years: |
Pay Versus Performance
| | For Stock Options Vesting in | | | | | | | 2024 | 2023 | 2022 | 2021 | 2020 | | Expected volatility | 72.02% - 77.95% | 71.79% - 77.78% | 69.15% - 76.30% | 64.38% - 72.22% | 56.71% - 71.56% | | Expected dividend yield | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | | Expected term, in years | 3.0 - 5.0 | 3.0 - 5.0 | 3.2 - 5.0 | 3.0 - 5.0 | 3.2 - 5.0 | | Risk-free interest rate | 3.44% - 4.81% | 3.54% - 4.91% | 0.97% - 4.48% | 0.19% - 1.34% | 0.15% - 1.69% |
Pay Versus Performance
| (6) The amounts reported in this column represent the cumulative total return on $100 invested in the Company’s common stock as of December 31, 2019 through the last trading day for the applicable fiscal year in the table. The Company has not paid any dividends since its IPO. |
Pay Versus Performance
| (7) The amounts reported in this column represent the weighted cumulative total return on $100 invested as of December 31, 2019 through the last trading day for the applicable fiscal year in the table, weighted according to the respective companies’ stock market capitalization at the beginning of each period for which a return is indicated. The peer group total shareholder return set forth in this table utilizes the Nasdaq Healthcare Index (IXHC), which we also utilize in the stock performance graph required by Item 201(e) of Regulation S-K included in our Annual Report on Form 10-K for the year ended December 31, 2024. The return of this index is calculated assuming reinvestment of dividends during the period presented. |
Pay Versus Performance
| (8) The amounts reported in this column represent the amount of net income (loss) reflected in the Company’s audited financial statements for the applicable year. |
Pay Versus Performance
| (9) The amounts reported in this column represent revenue, our Company-Selected Measure, which we believe is the most important financial measure used to link compensation actually paid to our named executive officers to Company performance for 2024. The amounts represent the amount of revenue reflected in the Company’s audited financial statements for the applicable year. |
Narrative Disclosure: Pay Versus Performance Table
Narrative Disclosure: Pay Versus Performance Table The graphs below provide a description of CAP (as calculated in accordance with the SEC rules) to our NEOs and the following measures:
Narrative Disclosure: Pay Versus Performance Table
| • | TransMedics’ cumulative TSR and Peer Group (NASDAQ Healthcare Index) cumulative TSR; |
Narrative Disclosure: Pay Versus Performance Table
| • | TransMedics’ Net Income (Loss); and |
Narrative Disclosure: Pay Versus Performance Table
| • | the Company Selected Measure, which for TransMedics is Revenue. |
Narrative Disclosure: Pay Versus Performance Table
| TransMedics Group, Inc. 2025 Proxy Statement | 47 |
Narrative Disclosure: Pay Versus Performance Table
| 48 | TransMedics Group, Inc. 2025 Proxy Statement |