DEF 14A of Veracyte, Inc.
Filed Apr 29, 2025 · FY20240001384101-25-000051
Director Nominees and Board Summary
Director Nominees and Board Summary
Director Nominees and Board Summary
| | | | | | | Committee Membership | | | | | | Name and Primary Position | | Age | Director Since | Independent | Audit | Nominating and Corporate Governance | Compensation | Regulatory and Compliance | | | | Marc Stapley Chief Executive Officer, Veracyte | 55 | 2021 | N | | | | | | | | | | | | | | | | | | | Eliav Barr, M.D. Head of Global Clinical Development and Chief Medical Officer, Merck Research Laboratories | 60 | 2022 | Y | | | | ● | | | | | | | | | | | | | | | Muna Bhanji, R.Ph. Founder and President, TIBA Global Access LLC | 62 | 2021 | Y | | ● | | ● | | | | | | | | | | | | | | | Karin Eastham $ Board of Directors member, Personalis, Inc. | 75 | 2012 | Y | ● | | C | | | | | | | | | | | | | | | | Robert S. Epstein, M.D., M.S. • Board of Directors member, Fate Therapeutics, Inc. and Illumina, Inc. | 70 | 2015 | Y | | C | | | | | | | | | | | | | | | | | Jens Holstein $ Chief Financial Officer, BioNTech SE | 61 | 2020 | Y | C | | ● | | | | | | | | | | | | | | | | Evan Jones $ Managing member, jVen Capital, LLC | 68 | 2008 | Y | ● | ● | | C | | | | | | | | | | | | | | | Tom Miller, Ph.D. Co-founder and Chief Executive Officer, Iambic Therapeutics | 46 | 2024 | Y | | | | ● | | | | | | | | | | | | | | | Brent Shafer Interim CEO and Chair, Baxter International, Inc. and Board of Directors member, Tactile Systems Technology, Inc. | 67 | 2024 | Y | | | ● | | | | | | | | | | | | |
Director Nominees and Board Summary
| ● Committee Member | C Committee Chairperson | • Chair of the Board | $ Audit Committee Financial Expert |
Director Nominees and Board Summary
| 4 | Veracyte 2025 Proxy Statement |
Director Nominees and Board Summary
2024 Financial and Business Highlights and Recent Company Developments
Director Nominees and Board Summary
| 23% Increase in revenue from $361.1M in 2023 to $445.8M in 2024 | 152,750 Total test volume for 2024, an increase of 20% from the prior year | $75.1M Cash generated from operating activities for the full year 2024 | $289.4M Cash and cash equivalents as of end of year 2024 |
Director Nominees and Board Summary
•Through Level I evidence, Decipher secured its position as the only gene expression test included in V1.2025 of the NCCN Clinical Practice Guidelines in Oncology (NCCN Guidelines®) for Prostate Cancer published in December 2024. •Received approval from Molecular Diagnostic Services Program (MolDx) for the technical assessment submission for Decipher for use in the metastatic population. •Expanded clinical evidence for Decipher Prostate with 57 publications, posters and presentations, including a presentation at the European Society for Medical Oncology (ESMO) 2024 Congress on new data from the STAMPEDE trial, a multi-center, randomized, phase 3 clinical trial showing that the test was prognostic for clinical outcomes and predicted benefit from docetaxel in patients with metastatic prostate cancer. •Received Medicare coverage for Afirma testing of patients with thyroid nodules classified as “Bethesda V,” giving more patients access to the test annually. Governance and Board Highlights
Board Composition
Board Composition
Gender
Gender
Age
Age
Tenure
Tenure
Independence
Independence
Independence
| Veracyte 2025 Proxy Statement | 5 |
Governance and Board Practices
Governance and Board Practices We are committed to good corporate governance, which strengthens the accountability of our Board of Directors and promotes the long-term interests of our stockholders. The list below highlights our independent board and leadership and other corporate governance practices, as discussed further in this Proxy Statement. •Majority of directors are independent (eight out of nine current directors). •Board leadership structure with an independent Chair of the Board of Directors. •All committees of our Board of Directors, including our Regulatory and Compliance Committee, are composed only of independent directors. •Following approval by our stockholders at the 2023 Annual Meeting of Stockholders (the “2023 Annual Meeting”), we filed a Restated Certificate of Incorporation (the “Restated Certificate”) to implement a declassification of the Board of Directors over a three-year period and provide for the annual election of directors for one-year terms, commencing upon the expiration of the directors’ then-current terms. Beginning with our 2026 Annual Meeting of Stockholders, all director nominees will stand for election for only one-year terms, such terms expiring at the next Annual Meeting of Stockholders. •Our Nominating and Corporate Governance Committee oversees our programs relating to corporate responsibility and sustainability, including Environmental, Social, and Corporate Governance (“ESG”), in collaboration with our Audit Committee, Compensation Committee, and Regulatory and Compliance Committee on certain ESG matters, as appropriate and as described in each respective committee charter. •We provide annual reporting on corporate responsibility and sustainability initiatives for those investors who are focused on these topics. •Our Board of Directors is focused on enhancing the composition of the Board. Currently, two out of our nine members of the Board of Directors are women, and two out of nine members of the Board of Directors are from underrepresented groups. •We employ comprehensive enterprise risk management practices, including oversight of cybersecurity, data privacy, legal, compliance and regulatory matters, and other critical evolving areas, such as corporate sustainability initiatives. •Independent directors conduct regular executive sessions without management present. •Directors maintain open communication and strong working relationships among themselves and have regular and direct access to management. •Directors conduct a robust annual Board of Directors and committee self-assessment process. •We have a majority voting standard for uncontested elections of directors. •We have robust related party transaction standards for any direct or indirect involvement of a director or member of management in the company’s business activities. •We have robust stock ownership guidelines that require our C-Level executive officers and the non-employee directors on our Board of Directors to hold shares of our common stock, as further discussed herein. •We have a clawback policy, adopted in accordance with the Nasdaq Stock Market listing standards and compliant with the Securities and Exchange Commission (the “SEC”) rules, that provides for the recoupment of certain executive officer incentive compensation in the event we are required to restate our financial statements.
Governance and Board Practices
| One-Year Terms For all directors commencing at our 2026 annual meeting |
Governance and Board Practices
| Majority Voting Standard For uncontested elections of directors |
Governance and Board Practices
| Only Independent Directors On all Board of Directors committees |
Governance and Board Practices
| Regular Executive Sessions Conducted by independent directors without management present |
Governance and Board Practices
| 6 | Veracyte 2025 Proxy Statement |
Governance and Board Practices
| PROPOSAL ONE |
Governance and Board Practices
Election of Directors Directors and Nominees The number of directors is currently set at nine. Following approval by our stockholders at the 2023 Annual Meeting, we filed a Restated Certificate to implement a declassification of the Board of Directors over a three-year period and provide for the annual election of directors for one-year terms, commencing upon the expiration of the directors’ then-current terms. As of the date of the Annual Meeting, five directors are either serving or completing a three-year term, two directors are serving or completing a one-year term and two directors are serving or completing an initial term, as follows: •Robert S. Epstein, M.D., M.S., and Evan Jones were elected to the Board of Directors at our 2023 Annual Meeting of Stockholders, and their three-year terms will expire at the Annual Meeting of Stockholders to be held in 2026 (the “2026 Annual Meeting”); •Muna Bhanji and Marc Stapley were elected to the Board of Directors at our 2024 Annual Meeting of Stockholders, and their one-year terms will expire at the Annual Meeting; •Eliav Barr, Karin Eastham and Jens Holstein were elected to the Board of Directors at our 2022 Annual Meeting of Stockholders, and their three-year terms will expire at the Annual Meeting; and •Tom Miller and Brent Shafer were appointed to the Board of Directors in September 2024, and their initial terms will expire at the Annual Meeting.
Governance and Board Practices
| YOUR VOTE IS IMPORTANT | | Our Board of Directors recommends a vote FOR this proposal |
Governance and Board Practices
Dr. Epstein is currently the Chair of the Board of Directors and will continue to serve in such role following the Annual Meeting. The Nominating and Corporate Governance Committee of the Board of Directors has recommended, and the Board of Directors has designated, Dr. Barr, Ms. Bhanji, Ms. Eastham, Mr. Holstein, Dr. Miller, Mr. Shafer and Mr. Stapley as the nominees for directors at the Annual Meeting to serve until the 2026 Annual Meeting or until their successors are duly elected or qualified.
Director Biographical Information
Director Biographical Information Names of the director nominees and the other members of the Board of Directors and certain biographical information as of April 21, 2025 are set forth below:
Director Biographical Information
| Veracyte 2025 Proxy Statement | 7 |
Director Biographical Information
| | | | | | | Marc Stapley has served as our Chief Executive Officer since June 1, 2021 and as a member of our Board of Directors since June 8, 2021. He served as the Chief Executive Officer of Helix, Inc., a genomics company, from 2019 to 2021. Prior to that, Mr. Stapley served in key managerial positions at Illumina, Inc., a genetic sequencing company, including as Chief Financial Officer from 2012 to 2017, as Chief Administrative Officer from 2015 to 2017, and as Executive Vice President from 2017 to 2019. From 2009 to 2012, Mr. Stapley served as Senior Vice President, Finance at Pfizer Inc., a pharmaceutical company. Mr. Stapley has served as a member of the board of directors of Glaukos Corporation, an ophthalmic medical technology company, since 2014, and has served as a member of the board of directors of Helix since 2015. Mr. Stapley holds a B.Sc. (Honors) in Mathematics from The University of Reading (England). We believe that Mr. Stapley is qualified to serve on our Board of Directors due to his significant leadership experience in the diagnostics and genetic sequencing fields, as well as his experience as our Chief Executive Officer and his service on the boards of directors of other life sciences and healthcare companies. | | | MARC STAPLEY | | | | Age: 55 Director Since: 2021 | |
Director Biographical Information
| | | | | | | Eliav Barr, M.D., has served on our Board of Directors since August 2022. Dr. Barr has served as Head of Global Clinical Development and Chief Medical Officer at Merck Research Laboratories (“MRL”), a division of Merck & Co., Inc. (“Merck”), since April 2022. He is also the Chairperson of the Late Development Review Committee at MRL, the governance committee that oversees the development programs for pipeline and in-line products in the Cardiovascular, Diabetes/Endocrine/ Metabolism, Immunology, Neurology, Oncology, Psychiatry, Respiratory, and Vaccines/Infectious Diseases therapeutic areas. Dr. Barr has held numerous leadership positions within MRL since joining the company in 1995, including serving as Senior Vice President, Global Medical and Scientific Affairs from 2018 to 2022. Prior to joining Merck, Dr. Barr pursued post-doctoral training at the University of Michigan and was on faculty at the University of Chicago. He holds a B.S. from Pennsylvania State University and an M.D. from Jefferson Medical College of Thomas Jefferson University and completed an Internal Medicine residency and Cardiology Fellowship at Johns Hopkins. We believe that Dr. Barr is qualified to serve on our Board of Directors due to his knowledge of the life sciences industry, his medical experience and his extensive executive and senior management experience in the biopharmaceutical industry. | | | ELIAV BARR | | | | Age: 60 Director Since: 2022 Committees: Regulatory and Compliance | |
Director Biographical Information
| 8 | Veracyte 2025 Proxy Statement |
Director Biographical Information
| | | | | | | Muna Bhanji, R.Ph., has served on our Board of Directors since March 2021. Ms. Bhanji is the Founder and President of TIBA Global Access LLC, an independent senior advisory/consultancy focused on commercialization and market access strategy development, serving the biopharmaceutical industry. Her prior experience includes an over 34-year tenure at Merck, during which she held a number of senior leadership roles within the U.S. and Global commercial organizations, including Senior Vice President, Oncology and Senior Vice President, Hospital & Specialty Franchises. Most recently, through December 2020, she served as the Senior Vice President, Global Market Access & Policy. In addition to serving as a director on a private company board, she currently serves on the board of directors of Intellia Therapeutics, Inc., Cytokinetics, Inc., Ardelyx, Inc. and Corus International, an international NGO. Prior to that, she had served on the boards of Possible Health, a Nepal-based NGO and the Foundation of Managed Care Pharmacy and had also chaired Merck’s Supervisory Board in the Netherlands. Ms. Bhanji earned her Bachelor of Pharmacy degree from Rutgers School of Pharmacy and an M.B.A. from St. Joseph’s University. We believe that Ms. Bhanji is qualified to serve on our Board of Directors due to her extensive experience in strategic roles in the biopharmaceutical industry. | | | MUNA BHANJI | | | | Age: 62 Director Since: 2021 Committees: Nominating and Corporate Governance Regulatory and Compliance | |
Director Biographical Information
| | | | | | | Karin Eastham has served on our Board of Directors since December 2012. Ms. Eastham has served on the board of directors of Personalis, Inc., a biotechnology company, since September 2019, and has served as chair of the board of directors of Personalis, Inc. since May 2022. She also has served on the boards of directors of Nektar Therapeutics, a biopharmaceutical company, and Geron Corporation, a biotechnology company. From 2004 to 2008, Ms. Eastham served as Executive Vice President and Chief Operating Officer, and as a member of the Board of Trustees, of the Burnham Institute for Medical Research, a nonprofit corporation engaged in biomedical research. From 1999 to 2004, Ms. Eastham served as Senior Vice President, Chief Financial Officer and Secretary of Diversa Corporation, a biotechnology company. Ms. Eastham previously held similar positions with several life sciences companies. Ms. Eastham also previously served as a member of the board of directors of Illumina, Inc. from 2004 to 2019, MorphoSys AG from 2012 to 2017, Amylin Pharmaceuticals, Inc. from 2005 until its acquisition in 2012, Genoptix, Inc. from 2008 until its acquisition in 2011, Tercica, Inc. from 2003 until its acquisition in 2008, and Trius Therapeutics, Inc. from 2007 until its acquisition in 2013. Ms. Eastham received a B.S. in Accounting and an M.B.A. from Indiana University and is a Certified Public Accountant (inactive). We believe that Ms. Eastham is qualified to serve on our Board of Directors due to her experience as a director of numerous life sciences companies, as well as her extensive senior management experience in the biopharmaceutical industry. | | | KARIN EASTHAM | | | | Age: 75 Director Since: 2012 Committees: Compensation (Chair) | |
Director Biographical Information
| Veracyte 2025 Proxy Statement | 9 |
Director Biographical Information
| | | | | | | Robert S. Epstein, M.D., M.S., has served on our Board of Directors since January 2015 and is Chair of the Board of Directors. Dr. Epstein has served as a strategic consultant to life sciences companies since 2013. From 2010 to 2012, Dr. Epstein served as President of the Medco-UBC Division and as Chief Research and Development Officer of Medco Health Solutions, Inc., a managed healthcare company. Prior to that, Dr. Epstein served as Medco’s Chief Medical Officer from 1997 to 2010. Dr. Epstein has served as a member of the board of directors of Fate Therapeutics, Inc. since March 2014 and Illumina, Inc. since November 2012. Dr. Epstein previously served as a member of the board of directors of Aveo Pharmaceuticals, Inc. from 2012 to 2014 and was Chairman of the Board of Decipher Biosciences, Inc. from 2019 until 2021. Dr. Epstein is the former president of the International Society of Pharmacoeconomics and Outcomes Research, and served on the board of directors of the Drug Information Association and the International Society of Quality of Life. He has also served on the Centers for Disease Control and Prevention Evaluation of Genomic Applications in Practice & Prevention Stakeholder Committee and the Agency for Healthcare Research and Quality Centers for Education and Research on Therapeutics Committee. Dr. Epstein holds a B.S. in Biomedical Science and an M.D. from the University of Michigan, and an M.S. in Preventive Medicine from the University of Maryland. We believe that Dr. Epstein is qualified to serve on our Board of Directors due to his extensive experience in strategic roles in healthcare companies, his expertise in reimbursement and FDA regulation, and his experience as a director of publicly traded companies in the life sciences industry. | | | ROBERT S. EPSTEIN | | | | Age: 70 Director Since: 2015 Committees: Nominating and Corporate Governance (Chair) | |
Director Biographical Information
| | | | | | | Jens Holstein has served on our Board of Directors since August 2020. Mr. Holstein has served as Chief Financial Officer of BioNTech SE, a biotechnology company, since July 2021. Previously, Mr. Holstein served as Chief Financial Officer of MorphoSys AG, a biopharmaceutical company, from 2011 to 2020. From 1995 to 2011, Mr. Holstein held various positions at Fresenius SE & Co. KGaA, a healthcare company, including regional Chief Financial Officer of Fresenius Kabi AG for the EME (Europe/Middle East) region and managing director of Fresenius Kabi Deutschland GmbH. Prior to joining Fresenius, Mr. Holstein spent several years in the consulting industry, with positions in Frankfurt and London. Mr. Holstein served as a director of InflaRx N.V., a biopharmaceutical company, from 2018 to 2020. Mr. Holstein holds a diploma in Business Administration from the University of Münster, Germany. We believe that Mr. Holstein is qualified to serve on our Board of Directors due to his significant experience as the chief financial officer of a publicly traded biopharmaceutical company, as well as his extensive experience in management positions in life science and healthcare companies. | | | JENS HOLSTEIN | | | | Age: 61 Director Since: 2020 Committees: Audit (Chair) Compensation | |
Director Biographical Information
| 10 | Veracyte 2025 Proxy Statement |
Director Biographical Information
| | | | | | | Evan Jones has served on our Board of Directors since February 2008. Mr. Jones has also served as Managing Member of jVen Capital, LLC, a life sciences investment company, since 2007. He served as Chief Executive Officer of OpGen, Inc., a genetic analysis company, from 2013 to 2020, and also served as a director from 2009 to 2021. He was a co-founder of Digene Corporation, a biotechnology company focused on women’s health and molecular diagnostic testing, serving as chairman of its board of directors from 1995 until its acquisition in 2007 and served as Chief Executive Officer from 1990 to 2006 and as President from 1990 to 1999. Mr. Jones served as a member of the board of directors of Foundation Medicine, Inc. until its merger with Roche Holdings, Inc. in 2018. Mr. Jones served as a director of Fluidigm Corporation from 2011 to 2017. Mr. Jones currently serves on the board of directors of ProtaGene GmbH, a private company, and Brightside Health, Inc., a private company. Mr. Jones received a B.A. in biochemistry from the University of Colorado and an M.B.A. from The Wharton School at the University of Pennsylvania. We believe that Mr. Jones is qualified to serve on our Board of Directors due to his knowledge of the life sciences industry and his experience as a chief executive officer and as a board member of other publicly traded and privately held life sciences companies. | | | EVAN JONES | | | | Age: 68 Director Since: 2008 Committees: Regulatory and Compliance (Chair) Audit Nominating and Corporate Governance | |
Director Biographical Information
| | | | | | | Tom Miller, Ph.D., has served on our Board of Directors since September 2024. Dr. Miller is a scientist and entrepreneur with a focus on the nexus of AI, chemistry and biology. Since 2020, he has served as Co-founder and Chief Executive Officer of Iambic Therapeutics, a clinical-stage biotechnology company that is disrupting the therapeutics landscape with a unique, AI-driven, drug-discovery platform. Prior to this, he served for over 10 years as a professor at the California Institute of Technology (Caltech), receiving tenure, publishing over 140 peer-reviewed articles and patents, and receiving numerous awards for research and entrepreneurial excellence. Dr. Miller earned a B.S. in Chemistry and Mathematics from Texas A&M University and a Ph.D. in Theoretical Chemistry from the University of Oxford. We believe that Dr. Miller is qualified to serve on our Board of Directors due to his expertise in AI, emerging technologies and data analytics. | | | TOM MILLER | | | | Age: 46 Director Since: 2024 Committees: Regulatory and Compliance | |
Director Biographical Information
| Veracyte 2025 Proxy Statement | 11 |
Director Biographical Information
| | | | | | | Brent Shafer has served on our Board of Directors since September 2024. Mr. Shafer is a veteran healthcare industry leader with over 40 years of experience in health information technology, medical devices and other related industries. Mr. Shafer has served as the interim Chief Executive Officer and Chair of the board of Baxter International, Inc. since February 2025 and has served as a director since May 2022. From 2018 to 2021, he was Chairman and Chief Executive Officer of Cerner Corporation, which was acquired by Oracle Corporation. Prior to that, Mr. Shafer held key roles at Royal Philips, the health technology company, including as Chief Executive Officer of Philips North America and of the Philips Home Healthcare Solutions business. Before joining Philips, Mr. Shafer was Vice President and General Manager of Hillrom’s Patient Care Environment Division and worked at GE Medical Systems in key sales, marketing and general management positions. Following early roles at Intermountain Healthcare’s Primary Children’s Hospital and Johnson & Johnson, Mr. Shafer held senior roles at Hewlett-Packard’s Medical Products Group. He currently serves on the board of Tactile Systems Technology, Inc. Mr. Shafer holds a B.S. in Communications from the University of Utah. We believe that Mr. Shafer is qualified to serve on our Board of Directors due to his extensive experience in health information technologies, medical devices and various healthcare solutions and his experience as a chief executive officer and a board member of other publicly traded companies. | | | BRENT SHAFER | | | | Age: 67 Director Since: 2024 Committees: Compensation | |
Director Biographical Information
A director nominee shall be elected to the Board if the number of votes cast “FOR” such director nominee’s election exceeds the number of votes cast “AGAINST” such director nominee’s election. Abstentions and broker non-votes with respect to any director nominee will have no effect as they are not considered votes cast for the foregoing purpose. This proposal is considered to be a non-routine proposal on which a broker or other nominee does not have discretionary authority to vote.
Director Biographical Information
| | | | The Board of Directors recommends a vote “FOR” the election of each of the seven director nominees: Eliav Barr, Muna Bhanji, Karin Eastham, Jens Holstein, Tom Miller, Brent Shafer and Marc Stapley. | |
Director Biographical Information
Director Nominations The Board of Directors has as an objective that its membership be composed of experienced and dedicated individuals with diversity of backgrounds, perspectives and skills. The Nominating and Corporate Governance Committee has the responsibility to identify, evaluate, recruit and recommend qualified candidates to the Board of Directors for appointment, nomination or election.
Director Biographical Information
| 12 | Veracyte 2025 Proxy Statement |
Director Biographical Information
The Nominating and Corporate Governance Committee evaluates and selects candidates for director based on their character, judgment, diversity of experience, business acumen and ability to act on behalf of all stockholders. The Nominating and Corporate Governance Committee believes that nominees for director should have experience, such as experience in management, legal, accounting, finance, or marketing, or industry and technology knowledge, that may be useful to our company and the Board of Directors, high personal and professional ethics, and the willingness and ability to devote sufficient time to effectively carry out his or her duties as a director. The Nominating and Corporate Governance Committee also believes that service as a director of other public companies provides experience and perspective that may be useful to our company and the Board of Directors. Although our company has no formal diversity policy for Board of Directors members, the Board of Directors and the Nominating and Corporate Governance Committee consider, amongst many factors, diversity of backgrounds and experiences when selecting nominees. The Nominating and Corporate Governance Committee believes it appropriate for at least one, and preferably multiple, members of the Board of Directors to meet the criteria for an “audit committee financial expert” as defined by Securities and Exchange Commission (the “SEC”) rules, and that a majority of the members of the Board of Directors meet the definition of “independent director” under the rules of The Nasdaq Stock Market. The Nominating and Corporate Governance Committee believes it appropriate for certain key members of our management — currently, our Chief Executive Officer — to participate as members of the Board of Directors. Prior to each Annual Meeting of Stockholders, the Nominating and Corporate Governance Committee identifies director nominees by evaluating the current directors whose term will expire at such Annual Meeting of Stockholders and who are willing to continue in service. These candidates are evaluated based on the criteria described above, including as demonstrated by the candidate’s prior service as a director, and the needs of the Board of Directors with respect to the particular talents and experience of its directors. In the event that a director does not wish to continue in service, or if a vacancy is created on the Board of Directors as a result of a resignation, an increase in the size of the Board of Directors or other event, then the Nominating and Corporate Governance Committee will consider various candidates for Board of Directors membership, including those suggested by the members of the Nominating and Corporate Governance Committee, by other board members, by any search firm engaged by the Nominating and Corporate Governance Committee and by stockholders, as applicable. Each of the nominees presented for election at this Annual Meeting is an incumbent member of the Board of Directors standing for re-election as a director. In addition, our amended and restated bylaws contain provisions that address the process by which a stockholder may nominate an individual to stand for election to the Board of Directors at an Annual Meeting of Stockholders. In order to nominate a candidate for director, a stockholder must give timely notice in writing to our Secretary and otherwise comply with the procedures set forth in our amended and restated bylaws, including with respect to the form and content of such notice. In addition, stockholders who intend to solicit proxies in support of director nominees other than the company’s nominees at an Annual Meeting of Stockholders must also comply with the additional requirements of Rule 14a-19(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). To be timely for our 2026 Annual Meeting, our amended and restated bylaws provide that we must have received the stockholder’s notice not earlier than 5:00 p.m. Eastern Time on February 17, 2026 and not later than 5:00 p.m. Eastern Time on March 19, 2026. Stockholder nominations must be made in accordance with the procedures outlined in, and include the information required by, our amended and restated bylaws and must be addressed to: Secretary, Veracyte, Inc., 6000 Shoreline Court, Suite 300, South San Francisco, California 94080. You may obtain a copy of the full text of this provision of the amended and restated bylaws by writing to our Secretary at the above address. Director Expertise, Experience and Attributes The Board of Directors is comprised of a diverse mix of directors with complementary expertise, experience and attributes, as summarized in the table below. This table is not exhaustive and our directors may also have additional skills, experience or attributes in addition to what is set forth below.
Director Biographical Information
| Veracyte 2025 Proxy Statement | 13 |
Director Biographical Information
| | Eliav Barr | Muna Bhanji | Karin Eastham | Robert Epstein | Jens Holstein | Evan Jones | Tom Miller | Brent Shafer | Marc Stapley | | Skills or Experience | | | | | | | | | | | Senior Leadership | | | | | | | | | | | | | | | | | | | | | | Diagnostics | | | | | | | | | | | | | | | | | | | | | | Biopharma | | | | | | | | | | | | | | | | | | | | | | U.S. Healthcare Reimbursement | | | | | | | | | | | | | | | | | | | | | | Global Enterprise | | | | | | | | | | | | | | | | | | | | | | Accounting and Auditing (including Sustainability Reporting) | | | | | | | | | | | | | | | | | | | | | | Public Board | | | | | | | | | | | | | | * | * | | * | | * | | | Technology, Innovation and AI | | | | | | | | | | | | | | | | | | | | | | Cybersecurity | | | | | | | | | | | | | | | | | | | | | | Regulatory and Risk Oversight | | | | | | | | | | | | | | | | | | | | | | Sales and Marketing | | | | | | | | | | | | | | | | | | | | | | Diversity | | | | | | | | | | | Gender | M | F | F | M | M | M | M | M | M | | Race/Ethnicity | White | Asian | White | White | White | White | White | White | White | | LGBTQ+ | | | | | | | | | | | | | | | | | | | | |
Director Biographical Information
*Public Board Chair Experience
Director Biographical Information
| Skill or Experience | Description | | Senior Leadership | Extensive executive, director or management experience from leadership and governance roles in corporations, government or public organizations. | | Diagnostics | Expertise in the medical diagnostics industry, including development. | | Biopharma | Significant background working in the biotechnology industry and in management of life sciences companies; experience in product development. | | U.S. Healthcare Reimbursement | Expertise in U.S. healthcare reimbursement, including reimbursement pathways, market access and healthcare regulations. | | Global Enterprise | Experience in global operations, including market expansion and international regulatory landscapes. | | Accounting and Auditing (including Sustainability Reporting) | Leadership or management experience resulting in financial proficiency and expertise. | | Public Board | Experience in roles on the board(s) of other public corporations. | | Technology and Innovation | Experience in technology, digital transformation, AI and data analytics. | | Cybersecurity | Experience in cybersecurity, including risk assessment and security strategies. | | Regulatory and Risk Oversight | Experience in risk management and regulatory frameworks. | | Sales and Marketing | Background in sales and marketing initiatives, including brand positioning and engagement. |
Director Biographical Information
| 14 | Veracyte 2025 Proxy Statement |
Director Biographical Information
Director Tenure and Age Distribution We also believe that our current Board of Directors composition represents an effective balance with respect to director tenure and age. Recent director additions provide the Board of Directors with fresh perspectives and diverse experiences, while directors with longer tenure provide continuity and valuable insight into our business and strategy. The following table provides information regarding the tenure and age distribution of our Board of Directors as of April 21, 2025.
Director Biographical Information
| Tenure | Number of Directors | Age | Number of Directors | | More than 10 years | 2 | 70+ years | 1 | | 6 – 10 years | 1 | 61 – 70 years | 5 | | 0 – 5 years | 6 | 45 – 60 years | 3 |
Director Biographical Information
Majority Voting Standard for Director Elections and Director Resignation Policy Our amended and restated bylaws provide for a majority voting standard for uncontested elections of directors, which provides that, in uncontested director elections, a director nominee will be elected only if the number of votes cast FOR the director nominee exceeds the number of votes cast AGAINST the director nominee. In addition, we have adopted a Director Resignation Policy, which is intended to address a “holdover director” under the Delaware General Corporation Law (the “DGCL”), which is an incumbent director who fails to receive the requisite number of votes for re-election at an Annual Meeting of Stockholders and is required to remain in office until a successor is duly elected and qualified. Our Director Resignation Policy requires each incumbent director nominee at an Annual Meeting of Stockholders to submit an irrevocable contingent resignation letter prior to such Annual Meeting of Stockholders, with such resignation, effective only upon (i) such director nominee’s failure to receive the requisite number of votes for re-election and (ii) our Board of Directors’ acceptance of such resignation. If the director nominee does not receive the requisite number of votes for re-election, our Nominating and Corporate Governance Committee will make a recommendation to our Board of Directors as to whether to accept or reject the resignation, or whether other action should be taken. Our Board of Directors will act on the Nominating and Corporate Governance Committee’s recommendation and publicly disclose its decision and the rationale behind it within 90 days from the date of the certification of the election results. Director Independence The Board of Directors has determined that, except for Mr. Stapley, each individual who currently serves as a member of our Board of Directors is, and each individual who served as a member of our Board of Directors in 2024 was, an “independent director” within the meaning of applicable rules of The Nasdaq Stock Market (“Nasdaq”). The Nasdaq independence definition includes a series of objective tests, including that the director is not, and has not been for at least three years, one of our employees and that neither the director nor any of his family members has engaged in various types of business dealings with us. As a result, Mr. Stapley is not considered independent as he serves as our Chief Executive Officer. In addition, as required by Nasdaq rules, for each of Ms. Bhanji, Ms. Eastham, Dr. Epstein, Dr. Barr, Mr. Holstein, Mr. Jones, Dr. Miller and Mr. Shafer, the Board of Directors considered their relationships and transactions with us and our security holders and has made a subjective determination that no relationships exist, which, in the opinion of our Board of Directors, would interfere with the exercise of their independent judgment in carrying out the responsibilities of a director. In making these determinations, our Board of Directors reviewed and discussed information provided by the directors with regard to each director’s business and personal activities and relationships as they may relate to us and our management. There are no family relationships among any of our directors or executive officers.
Director Biographical Information
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Director Biographical Information
Compensation Committee Interlocks and Insider Participation The members of our Compensation Committee during 2024 included John L. Bishop, until his term ended on June 12, 2024, Karin Eastham, Jens Holstein and Brent Shafer. No member of our Compensation Committee in 2024 was at any time during 2024 or at any other time an officer or employee of ours, and none had or have any relationships with us that are required to be disclosed under Item 404 of Regulation S-K. None of our executive officers has served as a member of the Board of Directors, or as a member of the compensation or similar committee, of any entity that has one or more executive officers who served on our Board of Directors or Compensation Committee during 2024. Board Meetings The Board of Directors held seven meetings and acted by written consent four times during 2024. Each director attended at least 80% of the aggregate number of meetings held by the Board of Directors and of the committees on which such director served. The independent directors meet in executive sessions at regularly scheduled meetings of the Board of Directors without the participation of the Chief Executive Officer or other members of management. We do not have a policy that requires the attendance of directors at the Annual Meeting. Board Committees Below is a description of each committee of the Board of Directors. The Board of Directors has determined that each director who serves on the Audit, Compensation, Nominating and Corporate Governance, and Regulatory and Compliance Committees is “independent,” as that term is defined for such committee by applicable listing standards of Nasdaq, rules of the SEC, and the applicable written charter for each of these committees. The charters of the Audit, Compensation, Nominating and Corporate Governance, and Regulatory and Compliance Committees are available on the investor section of our website under the corporate governance tab (https://investor.veracyte.com/corporate-governance). Please note, however, that the information contained on the website is not incorporated by reference in, or considered part of, this proxy statement. We will also provide copies of these documents and our company’s other corporate governance documents, free of charge, to any stockholder upon written request to Veracyte, Inc., Attention: General Counsel, 6000 Shoreline Court, Suite 300, South San Francisco, California 94080.
Director Biographical Information
| AUDIT COMMITTEE AND FINANCIAL EXPERT | The Audit Committee held seven meetings during 2024. Our Audit Committee oversees our corporate accounting and financial reporting process and assists our Board of Directors in oversight of the integrity of our financial statements, our compliance with certain legal and regulatory requirements, our independent auditor’s qualifications, independence and performance, and our internal accounting and financial controls. Our Audit Committee is responsible for the appointment, compensation, retention and oversight of our independent auditor. The Board of Directors has determined that each of Mr. Holstein, Ms. Eastham and Mr. Jones are qualified as an “audit committee financial expert” under the definition outlined by the SEC. | | Chair: Jens Holstein Members: Karin Eastham Evan Jones | |
Director Biographical Information
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Director Biographical Information
| COMPENSATION COMMITTEE | The Compensation Committee held four meetings and acted by written consent three times during 2024. Our Compensation Committee oversees our compensation policies, plans and benefits programs and determines and approves or, in the case of our chief executive officer, makes recommendations to our Board of Directors regarding the compensation of our executive officers. In addition, our Compensation Committee reviews and approves or makes recommendations to our Board of Directors with respect to our major compensation plans, policies and programs and assesses whether our compensation structure establishes appropriate incentives for officers and employees. The Compensation Committee also reviews and recommends non-employee directors’ compensation to the full Board of Directors. The Compensation Committee has the sole authority to select, retain, terminate and approve the fees and other retention terms of consultants as it deems appropriate to perform its duties. | | Chair: Karin Eastham Members: Jens Holstein Brent Shafer | |
Director Biographical Information
| NOMINATING AND CORPORATE GOVERNANCE | The Nominating and Corporate Governance Committee held five meetings and acted by written consent one time during 2024. Our Nominating and Corporate Governance Committee is responsible for making recommendations to our Board of Directors regarding candidates for directorships and the size and composition of the Board of Directors and its committees. In addition, our Nominating and Corporate Governance Committee is responsible for reviewing and making recommendations to our Board of Directors on matters concerning corporate governance and conflicts of interest, as well as recommendations and monitoring related to the company’s Environmental, Social and Corporate Governance ("ESG") efforts. | | Chair: Robert S. Epstein Members: Muna Bhanji Evan Jones | |
Director Biographical Information
| REGULATORY AND COMPLIANCE | The Regulatory and Compliance Committee held four meetings during 2024. Our Regulatory and Compliance Committee assists our Board of Directors in meeting its responsibilities with regard to oversight of our compliance with healthcare legal and regulatory requirements applicable to our business. | | Chair: Evan Jones Members: Muna Bhanji Eliav Barr Tom Miller | |
Director Biographical Information
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Director Biographical Information
Structure of the Board of Directors Our Board of Directors was previously divided into three classes, with each class serving staggered three-year terms. As part of our regular engagement with our stockholders and our commitment to ESG, including our regular review of our corporate governance structure and evaluation of recent trends in corporate governance, following approval by our stockholders at the 2023 Annual Meeting, we filed a Restated Certificate to implement a declassification of the Board of Directors over a three-year period, and provide for the annual election of directors for one-year terms, commencing upon the expiration of the directors’ then-current terms. The declassification of our Board of Directors began with the directors nominated for election at the 2024 Annual Meeting, and beginning with our 2026 Annual Meeting, all directors will stand for election for one-year terms. Board Leadership Structure and Role in Risk Oversight Our Nominating and Corporate Governance Committee periodically considers the leadership structure of our Board of Directors and makes such recommendations to our Board of Directors as our Nominating and Corporate Governance Committee deems appropriate. Our Board of Directors believes it is important to have flexibility in selecting the Chair of the Board of Directors and our Board of Directors leadership structure. The Board of Directors believes that is currently in the best interests of Veracyte and its stockholders for Dr. Epstein, an independent director, to serve as our Chair. Dr. Epstein has served on our Board of Directors since January 2015 and has deep familiarity with our business and our industry, including in-depth knowledge of the issues, opportunities and challenges facing our company and its business and make him well qualified to serve as our Chair. The Board of Directors believes that this leadership structure provides our Board of Directors with significant strengths and an independent leadership perspective. In his capacity as Chair, Dr. Epstein also serves ex officio on all committees of the Board of Directors and chairs executive sessions of the independent directors. The Board of Directors retains the authority to modify this structure as it deems appropriate. In making Board of Directors leadership structure determinations, the Board of Directors considers many factors, including the specific needs of the business and what is in the best interests of our stockholders. Any changes to the leadership structure of our Board of Directors, if made, will be disclosed on the Investor Relations portion of our website, and in our proxy materials for the next Annual Meeting of Stockholders. Our Board of Directors, in its sole discretion, may seek input from our stockholders on the leadership structure of the Board of Directors. Our Board of Directors is responsible for overseeing the overall risk management process at Veracyte. The responsibility for managing risk rests with executive management, while the committees of the Board of Directors and the Board of Directors as a whole participate in the oversight process. The risk oversight process of the Board of Directors builds upon management’s enterprise risk management assessment and mitigation processes, which include reviews of long-term strategic and operational planning, strategic biopharmaceutical partnerships and material opportunities, executive talent acquisition, retention, and development, compensation and evaluation, reputational, regulatory and legal compliance including those laws and regulations relating to product and service promotional activities, Medicare billing and reimbursement and provision of laboratory services, cybersecurity, privacy and financial reporting and internal controls. The Board of Directors considers strategic risks and opportunities and regularly receives reports from executive management regarding specific aspects of risk management, including but not limited to, our ability to expand our platform, products and services globally and our ability to potentially inform diagnosis and treatment decisions in new oncology indications. Our Board of Directors reviews strategic and operational risk in the context of discussions, question-and-answer sessions and reports from the management team at each regular Board of Directors meeting, receives reports
Director Biographical Information
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Director Biographical Information
on all significant committee activities at each regular Board of Directors meeting, and evaluates the risks inherent in significant transactions. Management, under oversight of the Audit Committee, conducts an annual enterprise risk management assessment to assess key enterprise risks over different time horizons: short-term (current to six months), mid-term (six to twelve months) and long-term (more than twelve months). Following such assessment, key risk areas are shared with the Audit Committee and management assigns owners to each risk who are tasked with reviewing and assessing the contributing factors, evaluating management’s existing risk mitigation capabilities, identifying risk mitigation enhancement considerations and potential future state activities, and assessing resources needed to implement desired mitigation enhancements. Each committee of the Board of Directors meets with key management personnel and representatives of outside advisors to oversee risks associated with their respective principal areas of focus both with management present and in separate executive sessions, as described below. We believe this division of responsibilities is an effective approach for addressing the risks we face and that our Board of Directors leadership structure supports this approach. The Audit Committee reviews (i) our major financial risks and enterprise exposures and the steps management has taken to monitor or mitigate such risks and exposures, including our risk assessment and risk management policies, as well as cybersecurity and data privacy risks and risk exposures in other areas, as the Audit Committee deems appropriate from time to time; (ii) our programs for promoting and monitoring compliance with applicable SEC legal and regulatory requirements, as well as major legal regulatory compliance risk exposures and the steps management has taken to monitor or mitigate such exposures; and (iii) the status of any significant legal and regulatory matters and any material reports or inquiries received from regulators or government agencies that reasonably could be expected to have a significant impact on our financial statements. The Compensation Committee reviews major compensation- and human capital-related risk exposures and the steps management has taken to monitor or mitigate such exposures. The Nominating and Corporate Governance Committee reviews and assesses risks relating to our corporate governance practices, reviews and assesses our performance, risks, controls, and procedures relating to corporate responsibility and sustainability, including ESG matters, reviews the independence of our Board of Directors, and reviews and discusses our Board of Directors’ leadership structure and role in risk oversight. The Regulatory and Compliance Committee assists the Board of Directors with oversight of our compliance with corporate legal and regulatory requirements not already overseen by our Audit Committee. Oversight of Corporate Strategy One of our Board of Directors’ key responsibilities is overseeing management’s formulation and execution of corporate strategy. Our Board of Directors actively oversees management’s establishment and execution of corporate strategy, including major business and organizational initiatives, annual budget and long-term strategic plans, capital allocation priorities, potential corporate development opportunities and risk management. At its regularly scheduled meetings and throughout the year, our Board of Directors receives information and formal updates from our management and actively engages with the senior leadership team with respect to our corporate strategy. Our Board of Directors’ diverse skill set and experience enhances its ability to support management in the execution and evaluation of our corporate strategy. The independent members of our Board of Directors also hold regularly scheduled executive sessions at which strategy is discussed.
Director Biographical Information
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Director Biographical Information
Cybersecurity Risk Oversight The Board of Directors, in coordination with our Audit Committee, oversees our management of risks arising from cybersecurity threats. The Board of Directors and the Audit Committee each receive presentations and reports on cybersecurity risks, which address a wide range of topics including recent developments, evolving standards, vulnerability assessments, third-party and independent reviews, the threat environment, technological trends and information security considerations arising with respect to our peers and third parties. The Board of Directors and the Audit Committee also receive prompt and timely information regarding any cybersecurity incident that meets established reporting thresholds, as well as ongoing updates regarding any such incident until it has been addressed. On an annual basis, the Board of Directors and the Audit Committee discuss our approach to cybersecurity risk management with the members of management, including our Chief Information Officer. Our Cybersecurity Executive Leadership Team is composed of the Chief Information Officer, in coordination with our Chief Executive Officer, Chief Financial Officer, Chief Compliance Officer and General Counsel. The team works collaboratively across Veracyte to design and implement programs to protect our information systems from cybersecurity threats and to appropriately respond to any cybersecurity incidents in accordance with our cybersecurity incident response plan. To facilitate the success of our cybersecurity risk management program, multidisciplinary teams throughout Veracyte are engaged to address cybersecurity threats and to respond to cybersecurity incidents, including close collaboration with our chief privacy and data officer. Through ongoing communications with these teams, the Chief Information Officer and the Cybersecurity Executive Leadership Team monitor the prevention, detection, mitigation and remediation of cybersecurity threats and incidents in real time, and report such threats and incidents to the Audit Committee when appropriate. Veracyte’s Approach to Human Capital Management
VP Level and Above
| Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1)(2) | Total ($) | | Eliav Barr | 55,000 | 249,997 | 304,997 | | Muna Bhanji | 60,000 | 249,997 | 309,997 | | John L. Bishop (3) | 25,875 | — | 25,875 | | Karin Eastham | 75,000 | 249,997 | 324,997 | | Robert S. Epstein | 110,000 | 249,997 | 359,997 | | Jens Holstein | 77,500 | 249,997 | 327,497 | | Evan Jones | 75,000 | 249,997 | 324,997 | | Tom Miller | 18,333 | 499,997 | 518,330 | | Brent Shafer | 19,167 | 499,997 | 519,164 |
Equity Awards
Equity Awards Our compensation policy for non-employee directors for the 2024 fiscal year provided that any non-employee director who first joined our Board of Directors was automatically granted restricted stock units (“RSUs”) valued on the grant date at approximately $500,000 (the “Initial RSUs”). The Initial RSUs vest as to one-third of those shares on each of the first, second and third annual anniversaries of the date of grant. In addition, the policy in effect in 2024 provided that on the first business day after each Annual Meeting of Stockholders, each non-employee director who continues to serve on our Board of Directors and who has served as a director for at least six months would be automatically granted RSUs valued on the grant date at approximately $250,000 (the “Annual RSUs”). The Annual RSUs vest in full on the first anniversary of the date of grant or, if earlier, the date of the next Annual Meeting of Stockholders. The vesting of the RSUs described above will accelerate in full upon a change in control. Pursuant to the terms of the 2023 Plan, no non-employee director may receive equity awards that, when combined with cash compensation received for service as a non-employee director, exceeds $750,000 in value in any calendar year, or $1,500,000 in value in the calendar year in which such director first joins our Board of Directors. In February 2025, our Compensation Committee and Board of Directors reviewed our then-current non-employee director compensation program and competitive market data on the same, and determined to retain the cash retainer without change from 2024 (as detailed above). In February 2025, our Compensation Committee of the Board of Directors also determined to reduce the initial grant for new non-employee directors to $250,000 from $500,000, while retaining the annual equity awards at $250,000. Additionally, beginning in 2025, the initial grant is to be prorated based on whole months of service prior to the Annual Meeting of Stockholders, and the six-month service requirement for the annual grant was removed.
Equity Awards
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Equity Awards
| PROPOSAL TWO |
Equity Awards
Ratification of Appointment of Independent Registered Public Accounting Firm The Audit Committee has appointed Ernst & Young LLP as our independent registered public accounting firm for the year ending December 31, 2025. Ernst & Young LLP has audited our financial statements since 2014. Representatives of Ernst & Young LLP are expected to be present at the Annual Meeting. They will have an opportunity to make a statement, if they desire to do so, and will be available to respond to appropriate questions. Independent Registered Public Accounting Firm Fees and Services The following table presents fees billed for professional audit services and other services rendered to us by Ernst & Young LLP for the years ending December 31, 2024 and 2023, respectively.
Equity Awards
| | Year Ended December 31, | | | Fees | 2024 ($) | 2023 ($) | | Audit Fees(1) | 2,615,955 | 2,519,149 | | Audit-related Fees(2) | — | — | | Tax Fees(3) | — | — | | All Other Fees(4) | — | — | | Total | 2,615,955 | 2,519,149 |
Equity Awards
(1)Audit fees include fees and out-of-pocket expenses, whether or not yet invoiced, for professional services provided in connection with the audit of our annual financial statements and review of our quarterly financial statements. (2)Audit-related fees include fees for consultations on accounting and reporting matters for acquisitions. (3)Tax fees consist of tax consulting services. (4)Other fees consist of consultations not related to audit or tax fees and access to an online accounting literature database. Pre-approval Policies and Procedures Our Audit Committee’s policy is to pre-approve all audit and permissible non-audit services provided by our independent registered public accounting firm. All of the services provided were pre-approved to the extent required. During the approval process, the Audit Committee considers the impact of the types of services and the related fees on the independence of the independent registered public accounting firm. The services and fees must be deemed compatible with the maintenance of that firm’s independence, including compliance with rules and regulations of the SEC. Throughout the year, the Audit Committee will review any revisions to the estimates of audit and non-audit fees initially approved.
Equity Awards
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Equity Compensation Is a Critical Element of Our Compensation Program
Equity Compensation Is a Critical Element of Our Compensation Program We believe that our equity incentive compensation program aligns the interests of management, employees and stockholders to create long-term stockholder value. We strongly believe that the approval of the Plan Amendment is essential to our continued success because we otherwise may not have sufficient shares available under our 2023 Plan to attract and retain new employees or to motivate and retain our existing employees. We believe that our future success and our ability to remain competitive depend on our ability to attract, retain and motivate highly qualified talent in an increasingly competitive market. The use of equity compensation, including the grant of options, RSUs and certain performance-based restricted stock units (“PSUs”), is a cornerstone of our strategy to attract and retain top-caliber employees. We currently grant RSUs to most U.S. employees, a mix of RSUs and PSUs to our executives and RSUs to our non-employee directors. Employee ownership in Veracyte aligns employee interests with those of our stockholders, incentivizing hard work for Veracyte's future growth and success. If the Plan Amendment is not approved, we may have insufficient shares available to continue to make equity grants to our employees and non-employee directors and may be forced to rely more heavily on cash compensation, both in the short-term and mid-term, to provide the market-competitive total compensation necessary to attract and retain critical talent. This increased reliance on cash compensation could reduce funds available for growth and development, demotivate employees and reduce the alignment between employees and stockholders.
Equity Compensation Is a Critical Element of Our Compensation Program
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Grant Practices
Grant Practices During the past three fiscal years, we granted equity awards under our 2023 Plan and our 2013 Stock Incentive Plan (the “2013 Plan”), which terminated in connection with the approval of our 2023 Plan, as summarized in the chart below. Our three-year average burn rate was approximately 3.41% for fiscal years 2022 through 2024 (see chart below for a calculation of our three-year burn rate). We define “burn rate” as the number of time-based equity awards granted during the year plus performance-based equity awards granted during the year, assuming target-level achievement, divided by the weighted average total number of shares of common stock outstanding. We believe that our use of equity compensation, across the company, is a strong compensation differentiator that allows us to attract and retain talent at all levels in the company. This also reflects our commitment to a culture of ownership and accountability, to align with all stockholders. Our gross burn rate is aligned with common market practices across the life sciences sector where we compete for talent and has been well within investor expectations historically. The burn rate figures included below are based on equity awards granted under our 2023 Plan and our 2013 Plan, and exclude potential dilution resulting from shares issued pursuant to our Amended and Restated Employee Stock Purchase Plan (the “ESPP”). As we continue to mature our compensation practices, we strive to achieve a burn rate and overhang at approximately the average rates of our peer group, and that are within the limits recommended by certain independent stockholder advisory groups.
Grant Practices
| Fiscal Year | Granted Appreciation Awards (Options and SARs) (#)(1) | Granted Full-Value Awards (RSUs) (#)(2) | Weighted Common Stock Outstanding as of December 31 of the applicable year (#) | Burn Rate (%) | | 2022 | 1,132,620 | 1,746,249 | 71,549,204 | 4.02 | | 2023 | 660,592 | 1,767,312 | 72,644,487 | 3.34 | | 2024 | — | 2,220,157 | 76,484,759 | 2.90 |
Grant Practices
(1)All options granted during 2022, 2023 and 2024 included a time-based vesting schedule. (2)Includes both time-based RSUs and PSUs (assuming target-level achievement) granted during 2022, 2023 and 2024.
Potential Dilution
| Outstanding appreciation awards (options) under all plans (#) | Full value awards outstanding under all plans (including PSUs at target) (#) | Number of shares available for grant under all plans (2023 Plan only) (#) | | 2,375,668 | 3,767,140 | 8,076,382 |
Share Reserve
Share Reserve If stockholders approve the Plan Amendment, there will be a cumulative total of 12,806,156 shares of common stock authorized under the 2023 Plan from its original effectiveness through the effectiveness of the Plan Amendment, subject to adjustment only to reflect stock splits and similar events. In addition, the following shares underlying awards granted under the 2023 Plan will become available for grant under the 2023 Plan: (a) shares subject to issuance upon exercise of a stock option or stock appreciation right granted under the 2023 Plan but that cease to be subject to the option or stock appreciation right for any reason other than exercise of the stock option or stock appreciation right; (b) shares subject to awards granted under the 2023 Plan that are forfeited or are repurchased by us at the original issue price; (c) shares subject to awards granted under the 2023 Plan that otherwise terminate without such shares being issued; (d) shares surrendered pursuant to a stockholder-approved exchange program; and (e) shares that are used to pay the exercise price of an award or withheld to satisfy the tax withholding obligations related to an award.
Equity Awards
Equity Awards The 2023 Plan will permit us to grant the following types of awards:
Stock Options
Stock Options The 2023 Plan provides for the grant of Incentive Stock Options (“ISOs”) and Non-qualified Stock Options (“NQSOs”). ISOs may be granted only to our employees or employees of our parent, subsidiaries and affiliates. NQSOs may be granted to eligible employees, consultants and directors of any of our parent, subsidiaries or affiliates. We are able to issue no more than 15,000,000 shares pursuant to the grant of ISOs under the 2023 Plan. The Compensation Committee determines the terms of each option award, provided that ISOs are subject to statutory limitations. The Compensation Committee also determines the exercise price for a stock option, provided that the exercise price of an option may not be less than the fair market value of our common stock on the date of grant (with certain additional requirements for certain ISOs). Options granted under the 2023 Plan vest at the rate and/or subject to performance requirements specified by the Compensation Committee and such vesting schedule is set forth in the stock option agreement to which such stock option grant relates. The Compensation Committee determines the term of stock options granted under the 2023 Plan, up to a term of ten years (with certain additional requirements for certain ISOs). After the option holder ceases to provide services to us, he or she is able to exercise his or her vested option for the period of time stated in the stock option agreement to which such option relates. Generally, the vested option will remain exercisable for three months after an optionee’s cessation of service, except in the case of termination due to death, disability or termination for cause. An option may not be exercised later than its expiration date.
Restricted Stock Units
Restricted Stock Units RSUs represent the right to receive shares of our common stock at a specified date in the future, subject to forfeiture of such right due to termination of employment or failure to achieve specified performance goals. RSUs do not have exercise price. If the RSUs have not been forfeited, then on the date specified in the award agreement we will deliver to the holder of the RSUs shares of our common stock, cash or a combination of our common stock and cash as specified in the applicable award agreement. The Compensation Committee determines the term of RSUs granted under the 2023 Plan, up to a term of ten years.
Restricted Stock Units
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Restricted Stock Awards
Restricted Stock Awards A restricted stock award is an offer by us to sell shares of our common stock subject to restrictions that the Compensation Committee may impose. These restrictions may be based on completion of a specified period of service with us or upon the achievement of performance goals during a performance period. The Compensation Committee determines the price of a restricted stock award. Unless otherwise set forth in the award agreement, vesting will cease on the date the participant no longer provides services to us, and at that time unvested shares will be forfeited to us or subject to repurchase by us.
Stock Bonus Awards
Stock Bonus Awards A stock bonus is an award of shares of our common stock for past or future services to us. Stock bonuses can be granted as additional compensation for performance and, therefore, are not issued in exchange for cash. The Compensation Committee determines the number of shares to be issued as stock bonus and any restrictions on those shares. These restrictions may be based on completion of a specified period of service with us or upon the achievement of performance goals during a performance period. Unless otherwise set forth in the award agreement, vesting ceases on the date the participant no longer provides services to us, and at that time unvested shares will be forfeited to us or are subject to repurchase by us.
Change in Control
Change in Control If we undergo a Corporate Transaction (as defined in the 2023 Plan), the 2023 Plan provides that outstanding awards shall be subject to the definitive agreement related thereto, and may be assumed, converted, replaced or substituted by the successor or acquiring entity, or by a parent or subsidiary of the successor or acquiring entity, for substantially equivalent awards (including, but not limited to, an award to acquire the same consideration paid to the stockholders pursuant to the Corporate Transaction), in each case after taking into account appropriate adjustments to the exercise price and the number and nature of shares subject to such awards as may be necessary or desirable under applicable law and the Internal Revenue Code, may be fully accelerated or may be settled for their intrinsic value (which may be determined to be zero). In the event such successor or acquiring corporation (if any) refuses to assume, convert, replace or substitute awards, or awards are not settled for their intrinsic value, pursuant to a Corporate Transaction, then such awards shall have their vesting accelerate as to all shares subject to such award (and any applicable right of repurchase fully lapse) immediately prior to the Corporate Transaction, with the acceleration of performance awards based on the greater of actual performance through the date of the Corporate Transaction or target performance, and then such awards will terminate. Awards need not be treated similarly in a Corporate Transaction and treatment may vary from award to award and/or from participant to participant. In the event of a Corporate Transaction, the vesting of all awards granted to our non-employee directors will accelerate and such awards will become exercisable (as applicable) in full upon the consummation of such event at such times and on such conditions as the Compensation Committee determines.
Nonqualified Stock Options, Stock Appreciation Rights
Nonqualified Stock Options, Stock Appreciation Rights A recipient of an NQSO or stock appreciation right will not recognize taxable income upon the grant of those awards. However, the participant will recognize ordinary income upon exercise in an amount equal to the difference between the fair market value of the shares and the exercise price on the date of exercise. Any gain or loss recognized on a subsequent disposition of the shares of common stock generally will be short‐term or long‐term capital gain or loss, depending on the length of time the recipient holds the shares.
Incentive Stock Options
Incentive Stock Options Neither the grant nor the exercise of an ISO will generally result in any taxable income to the recipient, except that the alternative minimum tax may apply at the time of exercise. The recipient will recognize a capital gain or loss on a later sale or other disposition of such shares provided the he or she does not dispose of such shares within two years from the date the option was granted or within one year after the shares were acquired by the recipient. If the shares are not held for holding period described above, the recipient will recognize ordinary income equal to the lesser of (i) the difference between the fair market value of the shares on the date of exercise and the exercise price, or (ii) the difference between the sales price and the exercise price. Any gain or loss recognized on a subsequent disposition of the shares of common stock generally will be short‐term or long‐term capital gain or loss, depending on the length of time the recipient holds the shares.
Restricted Stock Units
Restricted Stock Units A holder of RSUs does not recognize taxable income when the RSUs are granted. The recipient of the award generally will recognize ordinary income in each year in which the units vest in an amount equal to the fair market value of the shares of common stock received. Any gain or loss recognized on a subsequent disposition of the shares of common stock generally will be short‐term or long‐term capital gain or loss, depending on the length of time the recipient holds the shares.
Restricted Stock Units
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Other Awards
Other Awards The grant of restricted stock awards, stock bonus awards and performance shares will generally not be a taxable event. Generally, the recipient will recognize ordinary income equal to the excess of the fair market value over the price paid, if any, in the first taxable year in which his or her interest in the shares underlying the award becomes either (i) freely transferable or (ii) no longer subject to substantial risk of forfeiture (unless, with respect to an award of restricted stock, the recipient elects to accelerate recognition as of the date of grant). In each of the foregoing cases, we will generally have a corresponding deduction at the time the participant recognizes ordinary income, subject to Section 162(m) of the Internal Revenue Code and the relevant income tax regulations. Section 162(m) places a limit of $1 million on the amount of compensation that we may deduct as a business expense in any year with respect to certain of our most highly paid executive officers. We may from time to time pay compensation to our executives that may not be deductible if the Compensation Committee believes that doing so is in the best interests of our stockholders.
ERISA Information
ERISA Information The 2023 Plan is not subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended. New Plan Benefits Our NEOs and members of our Board of Directors have an interest in this proposal by virtue of them being eligible to receive equity awards under the 2023 Plan. No awards have been granted that are contingent on the approval of the Plan Amendment. Future awards under the 2023 Plan to executive officers, employees or other eligible participants are discretionary and cannot be determined at this time. Currently, our non-employee directors are entitled to receive cash and equity compensation for their service as directors as described above under “—2024 Director Compensation.” History of Grants Under the 2023 Plan The following table sets forth the number of shares subject to stock options or restricted stock unit awards granted under the 2023 Plan from its Effective Date, June 8, 2023, through March 31, 2025:
ERISA Information
(1)The weighted-average exercise price does not reflect the shares that will be issued in connection with the settlement of performance stock units and restricted stock units, since such units have no exercise price. (2)Excludes purchase rights accruing under the ESPP. (3)Consists of 8,971,566 shares available for issuance under our 2023 Plan, and 1,051,407 shares available for purchase under our ESPP. Required Vote The approval of the Plan Amendment will be determined by the vote of a majority of the shares present at the Annual Meeting or voting by proxy and entitled to vote at the Annual Meeting. Abstentions will have the same effect as votes “AGAINST” this proposal. Broker non-votes will have no effect on this proposal as they are not considered entitled to vote for the foregoing purpose. This proposal is considered to be a non-routine proposal on which a broker or other nominee does not have discretionary authority to vote.
ERISA Information
| | | | The Board of Directors recommends a vote “FOR” the approval of the Amendment to the Veracyte, Inc. 2023 Equity Incentive Plan. | |
2024 Compensation Highlights
2024 Compensation Highlights •Annual Cash Incentive Compensation Tied to Financial Performance. In 2024, our annual incentive award plan was designed to drive performance on key financial metrics — revenue and cash flow from operations. These metrics were achieved at 150%. •Equity Mix. In 2024, our NEOs were granted a mix of PSUs and RSUs, with the equity mix consisting of 50% PSUs (at target) and 50% RSUs.
Pay Program Overview
| Base Salary | •Base salaries are set to be competitive within our industry and are important in attracting and retaining talented executives. •Base salaries are fixed amounts paid in cash set with consideration for responsibilities, experience, individual contribution expectations and market data. | | Annual Cash Incentive Compensation | •The annual cash incentive award plan is intended to motivate and reward our executives for the achievement of certain strategic goals of Veracyte set by our Board of Directors. •Our annual incentive award plan is a variable short-term element of total compensation payable in cash as a percentage of base salary designed to drive performance on key financial objectives, including revenue and cash flow from operations. | | Long-Term Equity Incentive Compensation | •Long-term equity awards incentivize executives to deliver long-term stockholder value while also providing a retention vehicle for our top executive talent. •NEO equity awards are a variable long-term element of total compensation typically delivered as: •PSUs (based on achievement of revenue and cash balance metrics over two- and three- year periods) •RSUs (vesting over four years) •Stock options (vesting over four years; no longer granted since 2024) |
Compensation Governance
| WHAT WE DO | | | | Pay-for-performance philosophy and culture | | | | | | An appropriate mix of short- and long-term incentives for our executives | | | | | | Responsible use of shares under our long-term incentive program | | | | | | Perform an annual risk assessment of our compensation program | | | | | | Maintain stock ownership guidelines for all executives and non-executive directors | | | | | | “Double-trigger” change-in-control provisions | | | | | | Annually conduct Say-on-Pay vote | | | | | | Engage an independent compensation consultant | | | | | | Have an independent Compensation Committee | | | | | | Maintain a compensation recovery policy to ensure accountability | | | |
Compensation Governance
| WHAT WE DON'T DO | | | | No excise tax gross-ups | | | | | | No excessive perquisites | | | | | | No repricing of stock option awards without stockholder approval | | | | | | No discounted stock option awards | | | | | | No hedging or pledging of our stock | | | | | | No dividends or dividend equivalents on unvested equity awards | | | |
Say-on-Pay Results
Executive Compensation Philosophy and Objectives We have designed our executive compensation program to reward our executive officers, including our NEOs, at a level consistent with our overall strategic and financial performance and to provide remuneration sufficient to attract, retain and motivate them to exert their best efforts in the highly competitive environment in which we operate. We believe in providing competitive compensation packages consisting of a combination of base salary, an annual cash bonus and long-term incentive opportunities in the form of equity awards that are earned over a multi-year period. We believe the approach that has been adopted by our Compensation Committee, with an emphasis on variable cash compensation and equity awards, enables us to attract top talent, motivate successful short-term and long-term performance, satisfy our retention objectives, and align the compensation of our executive officers with our performance and long-term value creation for our stockholders.
Role of Management
Role of Management Veracyte’s Chief Executive Officer is involved in the design and implementation of our executive compensation and is typically present at Compensation Committee meetings, except that the Chief Executive Officer is not present during any voting or deliberations on his compensation. In 2024, the Chief Executive Officer reviewed the analysis and recommendations of Aon, with the Compensation Committee and made recommendations regarding proposed salary, cash bonus opportunities and equity awards for our officers (other than himself). Management also participates in conducting annual risk assessments and ensuring that any risks involving compensation are properly mitigated. The Compensation Committee exercises its business judgment in accepting, rejecting and/or modifying any such executive compensation recommendations and approves all compensation and equity awards for all executive officers other than the Chief Executive Officer.
Role of Independent Compensation Consultant
Role of Independent Compensation Consultant The Compensation Committee retains an independent compensation consultant to provide professional expertise regarding a variety of executive compensation and market practices. The Compensation Committee believes that working with an independent compensation consultant furthers our objectives to recruit and retain qualified executives, align their interests with those of stockholders and ensure that their compensation packages will appropriately motivate and reward ongoing achievement of business goals. The independent consultant assists the Compensation Committee in setting compensation and designing a comprehensive plan. In 2024, the Compensation Committee retained Aon to provide the following services: •Reviewing and modifying the compensation peer group; •Evaluating executive and director market pay analysis; •Developing executive and director pay programs; •Evaluating equity pay market analysis; •Examining the change in control and severance arrangement; and •Updating certain proxy disclosures, including this CD&A. The Compensation Committee annually evaluates the independent compensation consultant’s independence and performance under the applicable SEC and Nasdaq listing standards. Aon and its affiliates did not provide any services to us other than the services described in this proxy statement relating to director and executive compensation. The Compensation Committee conducted a specific review of its relationship with Aon in 2024, pursuant to the SEC rules and Nasdaq listing standards, and concluded that Aon’s work for the Compensation Committee did not raise any conflicts of interest.
Role of Independent Compensation Consultant
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Use of Competitive Data
Use of Competitive Data To assess the competitiveness of our executive compensation program and compensation levels, our Compensation Committee, with the assistance of Aon, examines the competitive compensation data for senior executives of our peer companies examining overall pay, and each pay element. The Compensation Committee uses a peer group to reference and analyze recent market data and understand the marketplace. The Compensation Committee also considers other factors such as individual performance, experience, history and scope of responsibility, current market conditions and the specific needs of the business at critical points in time. The Compensation Committee uses its best business judgment in setting pay with the peer group data as a reference point rather than as specific benchmark or a specific formula for allocated pay across the various elements. The Compensation Committee conducts an annual assessment of the peer group to ensure that it reflects Veracyte’s most current financial and sector-specific standing.
2024 Peer Group
2024 Peer Group Aon helped the Compensation Committee identify companies similar to us with respect to sector and market capitalization, as well as revenue and headcount, to provide a broad perspective on competitive pay levels and practices. The Compensation Committee also considers criteria from outside investors and the talent market when selecting the final criteria and list of companies. The following criteria were applied in developing the peer group used for 2024 compensation decisions: •Sector - Biotechnology/Pharmaceuticals, Life Sciences Tools and Services, and Health Care Equipment & Supplies companies; •Market Capitalization - $600.0 million to $5.6 billion, which was 0.3x to 3.0x; and •Revenue - 0.5x to 3x Veracyte’s projected revenues. Using these criteria, in July 2023 the following 18 companies were approved to make up our 2024 peer group^:
2024 Peer Group
| 10x Genomics (TXG)* | Adaptive Biotechnologies (ADPT) | Amicus Therapeutics (FOLD)* | | CareDx (CDNA) | Cytek Biosciences (CTKB) | Exact Sciences (EXAS) | | Fulgent Genetics (FLGT)* | Glaukos (GKOS)* | Guardant Health (GH) | | Invitae (NVTA) | Maravai Lifesciences (MRVI)* | Myriad Genetics (MYGN) | | Natera (NTRA) | NeoGenomics (NEO) | Nevro (NVRO)* | | Pacific Biosciences of California (PACB) | Twist Bioscience (TWST) | Vericel (VCEL) |
2024 Peer Group
^ Castle Biosciences, Codexis and NanoString Technologies were removed from the peer list due to no longer fitting the criteria. * New in 2024. At the time of approval, Veracyte was near the 50th percentile for revenue and market capitalization, reinforcing the balance in the group of companies.
2024 Peer Group
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2024 Annual Cash Incentives
2024 Annual Cash Incentives We provide our executives, including our NEOs, with the opportunity to annually earn cash incentives to encourage the achievement of corporate objectives, and to reward those individuals who significantly impact our corporate results. Payments under our annual bonus plan are based on the achievement of corporate goals established by our Board of Directors. Actual performance against these metrics funds the annual bonus plan pool and threshold levels of performance must be met for the pool to be funded. Each of our NEOs participated in our 2024 annual bonus plan. Executive officers who participate in this plan have an established annual incentive target, which is equal to a percentage of their base salary. The actual earned annual incentive bonus, if any, is calculated based on the bonus plan pool funding, pre-established company performance metrics and any adjustments for individual performance as assessed by the Compensation Committee (taking into consideration the assessment by the Chief Executive Officer) for the NEOs, and by the Board of Directors for the Chief Executive Officer. For 2024, our NEOs had the annual bonus target opportunities set forth in the table below. The target opportunities as a percentage of base salary for our incumbent NEOs were unchanged when compared to 2023. The maximum funding under the plan is 150% of target.
2024 Annual Cash Incentives
| Executive | Target Annual Incentive (as % of base salary) | | Marc Stapley | 100 | | Rebecca Chambers | 55 | | Phillip Febbo | 55 | | John Leite | 55 | | Annie McGuire | 55 |
2024 Annual Cash Incentives
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2024 Bonus Plan Awards
2024 Bonus Plan Awards In February 2024, the independent members of our Board of Directors, on the recommendation of the Compensation Committee, approved corporate goals for our 2024 annual bonus plan. Under the plan, eligible employees, including our NEOs, were eligible to receive a cash bonus if we achieved the corporate goals approved by our Board of Directors, as described in the table below. The Compensation Committee maintained revenue as the primary financial performance measure to be used to determine annual cash bonuses as it is the best indicator of our growth in terms of aggregate test volume and sales, and successful execution of our annual operating plan. In addition, the Compensation Committee maintained our cash balance as a second key measure to determine annual cash bonuses to provide an incentive to manage our cash expenditures as we navigated toward profitability. With respect to our NEOs, the bonus pool could be funded from 0% to 150% based upon achieving certain annual revenue and ending cash balance goals that were pre-established to align with our long-range goals as follows:
2024 Bonus Plan Awards
| | | Funding Amount | | | | Goals | Weighting | 75% | 100% | 150% | | Revenue | 60% | $394M | $408M | $436M | | Cash Balance | 40% | $228M | $245M | $279M |
2024 Bonus Plan Awards
For 2024, the annual incentive bonuses for the NEOs were determined based solely on Veracyte performance and did not include an individual performance multiplier. Actual annual performance bonus awards paid out under the plan could be greater or less than the NEOs’ individual targets, as determined by the independent members of our Board of Directors at their discretion, considering the recommendation of the Compensation Committee. The Board of Directors did not exercise this discretion when determining the final awards for 2024. In February 2025, the independent members of our Board of Directors, on the recommendation of the Compensation Committee, determined 2024 performance and the resulting cash bonus awards. For 2024, our total revenue, adjusted for the effect of changes in foreign currency exchange rates, was $446 million, which exceeded our goal of $408 million (an increase over the 2023 goal of $340 million and actual result of $358.5 million). For 2024, our ending cash balance was $289 million, which exceeded our goal of greater than $245 million (an increase over the 2023 goal of $160 million and actual result of $216.4 million). Each metric is calculated individually, and the sum of the calculations determines the potential bonus pool payout:
2024 Bonus Plan Awards
| Metric | Weighting | Minimum (75%) | Target (100%) | Maximum (150%) | Actual | Achievement (% of target payout) | | Total Revenue | 60% | $394M | $408M | $436M | $446M | 150% | | Ending Cash Balance | 40% | $228M | $245M | $279M | $289M | 150% | | Total | 100% | | | | | 150.0% |
2024 Bonus Plan Awards
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2024 Bonus Plan Awards
Based on a review of all goals and accomplishments, the independent members of our Board of Directors and Compensation Committee determined that the financial goals were achieved at 150%. Our NEOs’ earned annual incentives for 2024 were as follows:
2024 Bonus Plan Awards
| | Original FY 2024 Opportunity | | | Actual | | | Executive | 2024 Base Salary ($) | 2024 Target Bonus (as a % of base salary) | Target Bonus ($) | Corporate Multiplier (%) | 2024 Earned Bonus ($) | | Marc Stapley | 675,000 | 100 | 675,000 | 150.0 | 1,012,500 | | Rebecca Chambers | 530,400 | 55 | 291,720 | 150.0 | 437,580 | | Phillip Febbo | 550,000 | 55 | 302,500 | 150.0 | 453,750 | | John Leite | 472,500 | 55 | 259,875 | 150.0 | 389,813 | | Annie McGuire | 470,800 | 55 | 258,940 | 150.0 | 388,410 |
Equity Compensation
Equity Compensation A significant portion of executive pay is delivered as long-term incentives in the form of equity awards, which are designed to align executive officers’ interests with stockholder interests, promote retention through the reward of long-term company performance and encourage ownership in our company. We grant equity awards in the form of RSUs and PSUs. The Compensation Committee believes that certain targeted PSUs can provide an appropriate long-term incentive for our executive officers, as PSUs reward our executive officers only to the extent certain performance measures aligned with driving increased stockholder value are met. We believe that RSUs reward our executive officers with long-term stock price appreciation while simultaneously helping us retain our executive officers, as RSUs provide some value to the recipient even if the market price of our common stock declines following the grant date. The Compensation Committee initially determines the size of equity grants by considering the executive officer’s position and market data of our peer group companies as provided by Aon as well as overall dilution and other inputs. The Compensation Committee then takes into consideration each NEO’s recent performance history, his or her potential for future responsibility and criticality of his or her work to the long-term success of our company and the retention value of outstanding awards. The Compensation Committee uses its judgment to give relative weight to each of these factors as it sets the size of the equity grant to appropriately create an opportunity for reward based on increasing stockholder value. For newly hired or promoted executive officers, the Compensation Committee also takes into consideration the value needed to induce the individual to accept the position and to drive substantial performance.
2024 Equity Grants
2024 Equity Grants In February 2024, the Compensation Committee (and, in the case of our Chief Executive Officer, our Board of Directors), in consultation with Aon and in consideration of governance best practices as well as ongoing market trends and data of our compensation peers, determined to provide NEOs with annual grants that consisted of 50% RSUs and 50% PSUs. While no longer granting options to our NEOs, PSUs increased as a portion of 2024 total equity compensation (“2024 PSUs”). The terms of these 2024 PSUs are described below. The approved annual equity awards were granted to the NEOs, in the following amounts:
2024 Equity Grants
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2024 Equity Grants
| Executive | RSUs (#) | PSUs (#) | | Marc Stapley | 114,724 | 114,724 | | Rebecca Chambers | 59,856 | 59,856 | | Phillip Febbo | 39,904 | 39,904 | | John Leite | 49,880 | 49,880 | | Annie McGuire | 49,880 | 49,880 |
Time-Based Vesting RSUs
Time-Based Vesting RSUs The annual RSU awards granted in March 2024 vest as to 1/4 on the first anniversary of March 2, 2024 and then in equal quarterly installments over the following 12 quarters, based on continuing service on each vesting date (until the fourth anniversary of March 2, 2024).
Performance-Based RSUs
Performance-Based RSUs In March 2024, we again granted PSUs to certain of our executive officers, referred to as the 2024 PSUs. In 2023, we selected and continue to use revenue as a performance metric because we believe it is, and continues to be, an important indicator of our strategic long-term growth at this stage in our company’s maturity and it has been an important metric used by investors to assess the health and trajectory of our business. Further, in 2023, we incorporated an additional cash balance performance metric into this program to drive and reward improving profitability and durable growth, which is a key focus for the company. The 2024 PSUs continue to include revenue and cash balance as performance metrics. Additionally, to enhance the retention value of our long-term equity program and to drive sustained stockholder value growth, the 2024 PSUs also include a time-based service requirement such that any “achieved” PSUs will vest approximately one year after the end of the applicable performance period, subject to the officer’s continued service to Veracyte. Consistent with our 2023 PSU awards, the 2024 PSU awards are split into a two-year measurement period and a three-year measurement period to reward growth and execution over time. Forty percent of the total number of shares subject to the PSU granted in 2024 will be earned if the revenue and cash balance for the two-year period ending December 31, 2025 equals or exceeds a certain threshold and 60% of the total number of shares subject to the PSU will be earned if the revenue and cash balance for the three-year period ending December 31, 2026 equals or exceeds a higher threshold. Achievement between threshold, target and maximum levels of performance of each metric is interpolated, with a maximum achievement level of 150% of the target PSUs for each performance period. For the 2024 PSUs, the officer must remain in service with Veracyte at the end of each of these measurement periods to “earn” the PSUs at the approved achievement level and the officer must remain in service until the following year end in order for the PSUs to vest, with the exception of a qualified termination. In the event of a qualified termination after the end of PSUs were earned and before the vesting date the officer will still be eligible to receive the earned PSUs. At the time these 2024 PSUs were awarded, the Compensation Committee and Board of Directors believed our primary and immediate focus should be on increased, sustained revenue growth across multiple time horizons and with increased attention to profitability. To that end, in addition to including short-term one-year revenue growth and cash balance goals in the 2024 annual bonus plan, the Compensation Committee felt the 2024 PSU’s two-year and three-year measurement periods were the most appropriate length for our growth strategy and drive toward profitability. In the Compensation Committee’s opinion, this structure strikes a reasonable balance between investing for long-term growth and an ongoing focus on medium-term revenue increases, balances with cash management, given the dynamic changes in the diagnostic and testing marketplace. For purposes of the 2024 PSU awards, “revenue” means our total revenue calculated in accordance with U.S. Generally Accepted Accounting Principles ("U.S. GAAP"), as reported in our annual financial statements for the applicable year excluding adjustments for acquisitions or similar transactions and including adjustments for the impact of foreign currency exchange and portfolio decisions made by the Board to discontinue any of the company’s products for which projected revenue was included in the forecast on which the revenue target was based and “cash balance” means our cash and cash equivalents as of December 31 of the subject year calculated in accordance with U.S. GAAP, as reported in its annual
Performance-Based RSUs
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Performance-Based RSUs
financial statements for the subject year, excluding adjustments for acquisitions or similar transactions and including adjustments for capital raises, capital uses and the impact of acquisition-related contingent consideration obligations arising or occurring on or following the start of the applicable performance period.
Significant Competitive Harm in Disclosing Thresholds
Significant Competitive Harm in Disclosing Thresholds We have not publicly disclosed the specific PSU performance thresholds because we believe advance disclosure of the thresholds could cause significant competitive harm to our business. The thresholds were purposefully set to be more aggressive than our disclosed guidance and long-term financial plan and are fully achievable only by outperforming such guidance and plan. If specific thresholds were disclosed, they could be treated as our new guidance or long-term financial plan, which would not align with (i) our purpose of using the PSU performance thresholds to encourage exceptional outperformance of our rigorous disclosed guidance and plan, and (ii) how we understand the role the PSU performance thresholds have in our long-term business and strategy. Disclosing the specific thresholds could also create a retention risk for our Chief Executive Officer and other NEOs, who are crucial to the execution of our next phase of growth by giving insight into the retentive value of the PSU awards. Companies competing for our top executive talent could use the thresholds’ rigor and the significant challenge of achieving the full award, depending on how many tranches have been earned and what remains of the performance period, to undercut the value of the PSU awards by offering a sign-on bonus or a more easily achievable compensation package to induce our NEOs to leave Veracyte. While we are not disclosing the thresholds in advance, we plan to appropriately disclose applicable achievements in a fiscal year in the following year’s proxy statement.
Prior Year PSUs – Achievement
Prior Year PSUs – Achievement The following table and footnotes summarizes PSU awards that were eligible to be achieved during 2024.
Prior Year PSUs – Achievement
| PSU Awards (Year of Grant) | Performance Period | Performance Metric | Achievement (%) | | 2022 PSUs(1) | 3 years ended December 2024 | Revenue calculated in accordance with U.S. GAAP, adjusted for foreign currency exchange impact and portfolio decisions | 118.8% of target level performance of $440 million in Revenue 118.8% PSUs earned; vested in February 2025 | | 2023 PSUs(1) | 2 years ended December 2024 | Revenue calculated in accordance with U.S. GAAP, adjusted for foreign currency exchange impact and portfolio decisions Ending Cash, Cash Equivalents and Short-Term Investment balance as of December 31, 2024, excluding the impact of acquisitions and capital raises and uses | 139.7% of target level performance of $397 million in Revenue and max of 150% of target level performance of $175 million in Cash 143.8% PSUs earned; vested in February 2025 |
Prior Year PSUs – Achievement
(1)Any achieved PSUs vested upon the date the achievement was certified by the Compensation Committee during the first quarter of 2025, subject to the officer’s continued service to Veracyte. Additional Compensation Practices and Policies
Taxation of “Parachute” Payments and Deferred Compensation
Taxation of “Parachute” Payments and Deferred Compensation Sections 280G and 4999 of the Internal Revenue Code provide that certain employees, officers and directors, as well as individuals who hold significant equity interests and certain other service providers may be subject to an excise tax if they receive payments or benefits in connection with a change in control that exceed certain prescribed limits, and that we (or a successor) may forfeit a deduction on the amounts subject to this additional tax. Section 409A of the Internal Revenue Code imposes significant additional taxes in the event that an employee, including a named executive officer, director or service provider receives “nonqualified deferred compensation” that does not satisfy the conditions of Section 409A. We have not agreed and are not otherwise obligated to provide any named NEO with a “gross-up” or other reimbursement payment for any tax liability that he or she might owe as a result of the application of Sections 280G, 4999 or 409A of the Internal Revenue Code.
Summary Compensation Table
Summary Compensation Table The following table provides information concerning compensation awarded to, earned by, or paid to each of our NEOs for 2022, 2023 and 2024.
Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($)(1) | Option Awards ($)(1) | Non-Equity Incentive Plan Compensation ($)(2) | All Other Compensation ($)(3) | Total ($) | | Marc Stapley Chief Executive Officer | 2024 | 675,000 | — | 5,125,868 | — | 1,012,500 | 3,000 | 6,816,368 | | | 2023 | 650,000 | — | 3,703,968 | 1,927,416 | 900,250 | 3,000 | 7,184,634 | | | 2022 | 625,000 | — | 2,206,626 | 1,475,796 | 625,000 | 3,000 | 4,935,422 | | Rebecca Chambers Chief Financial Officer | 2024 | 530,400 | — | 2,674,366 | — | 437,580 | 3,000 | 3,645,346 | | | 2023 | 510,000 | — | 1,234,624 | 642,467 | 388,493 | 3,000 | 2,778,584 | | | 2022 | 463,500 | — | 1,406,185 | 1,144,161 | 305,910 | 3,000 | 3,322,756 | | Phillip Febbo Chief Scientific and Chief Medical Officer | 2024 | 550,000 | — | 1,782,911 | — | 453,750 | 3,000 | 2,789,661 | | | 2023 | 137,500 | — | 2,335,753 | 1,206,047 | 104,741 | 3,000 | 3,787,041 | | John Leite Global Chief Commercial Officer | 2024 | 472,500 | — | 2,228,638 | — | 389,813 | 3,000 | 3,093,951 | | | 2023 | 421,067 | — | 858,051 | 377,918 | 264,433 | 3,000 | 1,924,469 | | Annie McGuire General Counsel and Chief People Officer | 2024 | 470,800 | — | 2,228,638 | — | 388,410 | 3,000 | 3,090,848 | | | 2023 | 440,000 | — | 1,111,181 | 578,214 | 335,170 | 16,553 | 2,481,118 | | | 2022 | 334,872 | — | 933,955 | 946,422 | 154,041 | 77,765 | 2,447,055 |
Summary Compensation Table
(1)Amounts represent the aggregate fair value of the awards computed as of the grant date of each award in accordance with Topic 718 for financial reporting purposes, rather than amounts paid to or realized by the named individual. Our assumptions with respect to the calculation of these values are set forth in Note 9 to Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2024. There can be no assurance that option awards will be exercised or that RSUs or PSUs will settle (in which case no value will be realized by the individual) or that the value on exercise of options or settlement of RSUs or PSUs will approximate the fair value as computed in accordance with Topic 718. We computed the grant date fair value of PSU awards based on our achievement of the PSU awards' performance conditions at 100% of target. If the PSUs were instead valued based on the maximum outcome of the applicable performance condition (i.e., based on maximum level performance), the total amount for the PSU awards reported in this column for 2024 would increase as follows: Mr. Stapley from $2,562,934 to $3,844,401; Ms. Chambers from $1,337,183 to $2,005,775; Dr. Febbo from $891,455 to $1,337,183; Dr. Leite from $1,114,319 to $1,617,479; and Ms. McGuire from $1,114,319 to $1,617,479. (2)The amounts reported in the Non-Equity Incentive Plan Compensation column for 2024 represent annual cash bonuses paid to the NEOs as described in “—Compensation Discussion and Analysis—2024 Annual Cash Incentives.” (3)Other income includes matching contributions to 401(k) plans in an amount up to $3,000 per year.
Summary Compensation Table
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Grants of Plan-Based Awards Table
Grants of Plan-Based Awards Table The following table provides information concerning each grant of an award made in 2024 for each of our NEOs under any plan. This information supplements the information about these awards set forth in the Summary Compensation Table.
Grants of Plan-Based Awards Table
| | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards (1) | | | Estimated Future Payouts Under Equity Incentive Plan Awards(2) | | | All Other Stock Awards: Number of Shares of Stock or Units (#) | All Other Option Awards: Number of Securities Underlying Options (#) | Exercise or Base Price of Option Awards ($/Share) | Grant Date Fair Value of Stock and Option Awards ($)(3) | | Name | Type of Award | Grant Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | | | Marc Stapley | Cash | | 506,250 | 675,000 | 1,012,500 | — | — | — | — | — | — | — | | | RSUs(4) | 3/6/2024 | — | — | — | — | — | — | 114,724 | — | — | 2,562,934 | | | PSUs(5) | 3/6/2024 | — | — | — | 86,043 | 114,724 | 172,086 | — | — | — | 2,562,934 | | Rebecca Chambers | Cash | | 218,790 | 291,720 | 437,580 | — | — | — | — | — | — | — | | | RSUs(4) | 3/6/2024 | — | — | — | — | — | — | 59,856 | — | — | 1,337,183 | | | PSUs(5) | 3/6/2024 | — | — | — | 44,892 | 59,856 | 89,784 | — | — | — | 1,337,183 | | Phillip Febbo | Cash | | 226,875 | 302,500 | 453,750 | — | — | — | — | — | — | — | | | RSUs(4) | 3/6/2024 | — | — | — | — | — | — | 39,904 | — | — | 891,455 | | | PSUs(5) | 3/6/2024 | — | — | — | 29,928 | 39,904 | 59,856 | — | — | — | 891,455 | | John Leite | Cash | | 194,906 | 259,875 | 389,813 | — | — | — | — | — | — | — | | | RSUs(4) | 3/6/2024 | — | — | — | — | — | — | 49,880 | — | — | 1,114,319 | | | PSUs(5) | 3/6/2024 | — | — | — | 37,410 | 49,880 | 74,820 | — | — | — | 1,114,319 | | Annie McGuire | Cash | | 194,205 | 258,940 | 388,410 | — | — | — | — | — | — | — | | | RSUs(4) | 3/6/2024 | — | — | — | — | — | — | 49,880 | — | — | 1,114,319 | | | PSUs(5) | 3/6/2024 | — | — | — | 37,410 | 49,880 | 74,820 | — | — | — | 1,114,319 |
Grants of Plan-Based Awards Table
(1)Reflects threshold, target and maximum cash bonus amounts for 2024 performance under our 2024 bonus plan, as described in “—Compensation Discussion and Analysis-2024 Bonus Plan Awards.” These amounts do not necessarily correspond to the actual amounts that were received by our NEOs. (2)Reflects threshold, target and maximum amounts for 2024 PSUs awards, as described in “—Compensation Discussion and Analysis—Equity Compensation.” (3)The amounts reported in this column represent the grant date fair value of each award as computed in accordance with ASC 718. Note that the amounts reported in these columns reflect the accounting cost for these awards and do not correspond to the actual economic value that may be received by our NEOs from the awards. In particular, amounts in this column include the grant date fair value of the 2024 PSUs granted to our NEOs during the year ended December 31, 2024, as computed in accordance with ASC 718, assuming the probable outcome of related performance conditions, which we have expected to be achieved at 100% of target for each of the 2024 PSUs. (4)The RSUs vest at a rate of 1/4th of the total number of RSUs on the one-year anniversary of the vesting commencement date, and vest at a rate of 1/16th of the total number of RSUs on each quarter thereafter. The RSUs are subject to acceleration upon certain events as described in “—Potential Payments upon Termination or Change in Control.” (5)40% of the total number of PSUs will vest on December 2, 2026 subject to the certification of achievement of the performance metric for the performance period ending December 31, 2025 and 60% of the total number of PSUs will vest on December 2, 2027 subject to the certification of achievement of the performance metric for the performance period ending December 31, 2026 and the continued service of the applicable executive. The PSUs are subject to acceleration upon certain events as described in “—Potential Payments upon Termination or Change in Control.”
Grants of Plan-Based Awards Table
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2024 Outstanding Equity Awards at Fiscal Year-End
2024 Outstanding Equity Awards at Fiscal Year-End The following table provides information concerning the outstanding and unexercised stock options, outstanding RSUs and outstanding PSUs that have not vested for each NEO as of December 31, 2024.
2024 Outstanding Equity Awards at Fiscal Year-End
| | | Option Awards | | | | Stock Awards | | | | | Name | Grant Date | Number of Securities Underlying Unexercised Options (# Exercisable) | Number of Securities Underlying Options (# Unexercisable)(1) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($)(3) | Equity Incentive Plan Awards: Number of Unearned Shares or Units of Stock That Have Not Vested (#) | Equity Incentive Plan Awards: Market Value or Payout Value of Unearned Shares or Units of Stock That Have Not Vested ($) (4) | | Marc Stapley | 6/1/2021 | 120,794 | 17,257 | 36.60 | 6/1/2031 | 5,851 | 231,700 | — | — | | | 3/3/2022 | 70,830 | 32,196 | 26.02 | 3/3/2032 | 40,054 | 1,586,138 | — | —(5) | | | 3/6/2023 | 56,380 | 72,489 | 23.73 | 3/6/2033 | 88,791 | 3,516,124 | 70,239 | 2,781,464(6) | | | 3/6/2024 | | | | | 114,724 | 4,543,070 | 86,043 | 3,407,303(7) | | Rebecca Chambers | 7/19/2021 | 57,229 | 9,771 | 36.59 | 7/19/2031 | 6,375 | 252,450 | — | — | | | 3/3/2022 | 25,968 | 11,805 | 26.02 | 3/3/2032 | 14,686 | 581,566 | — | —(5) | | | 8/5/2022 | 28,386 | 8,110(2) | 27.90 | 8/5/2032 | 5,351 | 211,900(8) | — | — | | | 3/6/2023 | 18,793 | 24,163 | 23.73 | 3/6/2033 | 29,597 | 1,172,041 | 23,412 | 927,115(6) | | | 3/6/2024 | | | | | 59,856 | 2,370,298 | 44,892 | 1,777,723(7) | | Phillip Febbo | 10/2/2023 | 25,041 | 60,817 | 21.96 | 10/2/2033 | 70,476 | 2,790,850 | 47,864 | 1,895,414(6) | | | 3/6/2024 | | | | | 39,904 | 1,580,198 | 29,928 | 1,185,149(7) | | John Leite | 9/1/2022 | 24,212 | 18,832 | 19.81 | 9/1/2032 | 11,244 | 445,262 | — | — | | | 3/6/2023 | 11,054 | 14,214 | 23.73 | 3/6/2033 | 8,869 | 351,212 | — | — | | | 9/11/2023 | | | | | 11,006 | 435,838 | 17,222 | 681,991(6) | | | 3/6/2024 | | | | | 49,880 | 1,975,248 | 37,410 | 1,481,436(7) | | Annie McGuire | 2/28/2022 | 29,873 | 12,302 | 27.80 | 2/28/2032 | 7,143 | 282,863 | — | —(5) | | | 8/5/2022 | 14,193 | 4,055(2) | 27.90 | 8/5/2032 | 2,676 | 105,970(8) | — | — | | | 3/6/2023 | 16,913 | 21,747 | 23.73 | 3/6/2033 | 26,636 | 1,054,786 | 21,072 | 834,451(6) | | | 3/6/2024 | | | | | 49,880 | 1,975,248 | 37,410 | 1,481,436(7) |
2024 Outstanding Equity Awards at Fiscal Year-End
(1)Except as otherwise noted, options become exercisable as to 25% of the shares on the first anniversary of the vesting commencement date, and the remaining shares vest at a rate of 1/48th of the total number of shares subject to the options each month thereafter. The options have a term of ten years, subject to earlier termination upon termination of employment. The options are subject to acceleration upon certain specified events; for more information, see “—Potential Payments upon Termination or Change in Control” below. (2)The stock option vests at a rate of 1/3rd of the total number of shares of common stock underlying the stock option on the one-year anniversary of the vesting commencement date, and vests at a rate of 1/36th of the total number of shares of common stock underlying the stock option each month following such one-year anniversary. The stock option is subject to acceleration upon certain events as described in “—Potential Payments upon Termination or Change in Control” below.
2024 Outstanding Equity Awards at Fiscal Year-End
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2024 Outstanding Equity Awards at Fiscal Year-End
(3)Based on a price of $39.60 per share, which was the closing price per share of our common stock as reported by The Nasdaq Global Market on December 31, 2024. Except as otherwise noted, RSUs vest and settle as to 25% of the units on the first anniversary of the vesting commencement date, and the remaining RSUs vest and settle at a rate of 1/16th of the total number of shares subject to the units each quarter thereafter. The RSUs are subject to acceleration upon certain specified events; for more information, see “—Potential Payments upon Termination or Change in Control” below. (4)Based on a price of $39.60 per share, which was the closing price per share of our common stock as reported by The Nasdaq Global Market on December 31, 2024 and assuming the PSU awards' performance conditions are achieved at 100% of target. The PSUs are subject to acceleration upon certain specified events; for more information, see “—Potential Payments upon Termination or Change in Control” below. (5)For the 2022 PSUs, 1/3 of the total number of PSUs were eligible to be earned and vest subject to and upon certification of achievement of the performance metric for the performance period ending December 31, 2023 (the “2023 Tranche”) and 2/3 of the total number of PSUs were eligible to be earned and vest subject to and upon the certification of achievement of the performance metric for the performance period ending December 31, 2024 (the “2024 Tranche”) and the continued service of the applicable executive. The 2022 PSUs vest between 75% and 125% of the total grant based on the achievement of the performance metrics. The 2024 Tranche was earned at 118.8% of target achievement and the resulting PSUs are included under the column titled “Number of Shares or Units of Stock That Have Not Vested”; they vested in February 2025. (6)For the 2023 PSUs, 40% of the total number of PSUs were eligible to be earned and vest subject to and upon certification of achievement of the performance metric for the performance period ending December 31, 2024 (the “2024 Tranche”) and 60% of the total number of PSUs will vest subject to and upon the certification of achievement of the performance metric for the performance period ending December 31, 2025 (the “2025 Tranche”) and the continued service of the applicable executive. The 2023 PSUs vest between 75% and 150% of the total grant based on the achievement of the performance metrics. The 2024 Tranche was earned at 143.8% of target achievement and the resulting PSUs are included under the column titled “Number of Shares or Units of Stock That Have Not Vested”; they vested in February 2025. The performance period for the 2025 Tranche has not yet concluded and such PSUs are reflected at the overall maximum performance level under the column titled “Equity Incentive Plan Awards: Number of Unearned Shares or Units of Stock That Have Not Vested.” (7)For the 2024 PSUs, 40% of the total number of PSUs will vest subject to and upon certification of achievement of the performance metric for the performance period ending December 31, 2025 and 60% of the total number of PSUs will vest subject to and upon the certification of achievement of the performance metric for the performance period ending December 31, 2026 and the continued service of the applicable executive. The 2024 PSUs vest between 75% and 150% of the total grant based on the achievement of the performance metrics. The performance period for the 2024 PSUs have not yet concluded and such PSUs are reflected at the overall threshold performance levels under the column titled “Equity Incentive Plan Awards: Number of Unearned Shares or Units of Stock That Have Not Vested.” (8)The RSUs vest at a rate of 1/3rd of the total number of RSUs on the one-year anniversary of the vesting commencement date, and vest at a rate of 1/12th of the total number of RSUs on each quarter thereafter. The RSUs are subject to acceleration upon certain events as described in “—Potential Payments upon Termination or Change in Control” below.
Stock Option Exercises and Stock Vested Table
Stock Option Exercises and Stock Vested Table The following table presents, for each of our NEOs, the number of shares of our common stock acquired upon the exercise of stock options or vesting and settlement of RSUs and PSUs during 2024 and the aggregate value realized upon the exercise of stock options and the vesting and settlement of RSUs and PSUs.
Stock Option Exercises and Stock Vested Table
| | 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 ($)(2) | | Marc Stapley | — | — | 71,761 | 1,964,975 | | Rebecca Chambers | — | — | 36,515 | 1,030,640 | | Phillip Febbo | — | — | 13,295 | 586,575 | | John Leite | — | — | 13,322 | 383,028 | | Annie McGuire | — | — | 19,524 | 560,964 |
Stock Option Exercises and Stock Vested Table
(1)The value realized on exercise is calculated as the difference between the fair market value of our common stock on the date of exercise and the applicable exercise price of those options. (2)The aggregate value realized upon the vesting and settlement of an RSU or PSU is based on the closing price on the Nasdaq Global Market of a share of common stock on the date prior to the day of vesting.
Stock Option Exercises and Stock Vested Table
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Potential Payments upon Termination or Change in Control
Potential Payments upon Termination or Change in Control We have entered into change of control and severance agreements with each of our NEOs. Each of these agreements has an initial term of four years, which term automatically renews for additional one‑year periods unless either party provides written notice of non-renewal at least 60 days prior to the date of automatic renewal and which term extends for one year from a “change of control,” as defined in the agreement, if such change of control occurs within the final 12 months of the initial term or the term as extended through automatic renewal.
During Change in Control Period
| Year | Summary Compensation Table Total for Marc Stapley ($)(1) | Summary Compensation Table Total for Bonnie Anderson ($)(1) | Compensation Actually Paid to Marc Stapley ($)(1)(2)(3) | Compensation Actually Paid to Bonnie Anderson ($)(1)(2)(3) | Average Summary Compensation Table Total for Non-PEO NEOs ($)(1) | Average Compensation Actually Paid to Non-PEO NEOs ($)(1)(2)(3) | Value of Initial Fixed $100 Investment based on:(4) | | Net Income ($ in millions) | Total Revenue ($ in millions)(⁵) | | | | | | | | | TSR ($) | Peer Group TSR ($) | | | | 2024 | 6,816,368 | — | 14,888,998 | — | 3,154,952 | 6,617,801 | 141.83 | 118.20 | 24.1 | 445.8 | | 2023 | 7,184,634 | — | 9,559,060 | — | 2,742,803 | 3,440,029 | 98.53 | 118.87 | (74.4) | 361.1 | | 2022 | 4,935,422 | — | 1,622,674 | — | 3,725,476 | 1,450,011 | 84.99 | 113.65 | (36.6) | 296.5 | | 2021 | 5,741,940 | 4,518,093 | 5,700,065 | 2,876,781 | 2,235,504 | (434,017) | 147.56 | 126.45 | (75.6) | 219.5 | | 2020 | — | 4,571,345 | — | 15,466,734 | 2,200,189 | 5,837,075 | 175.29 | 126.42 | (34.9) | 117.5 |
Relationship Between Compensation Actually Paid and Performance
Relationship Between Compensation Actually Paid and Performance The following charts show the relationship between Compensation Actually Paid, Total Stockholder Return, total revenue and net loss for 2020, 2021, 2022, 2023 and 2024.
Relationship Between Compensation Actually Paid and Performance
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Methodology and Pay Ratio
Methodology and Pay Ratio On December 31, 2024, the determination date, our principal executive officer was Mr. Marc Stapley, our Chief Executive Officer. For 2024, the total annual compensation for Mr. Stapley was $6,816,368. The total annual compensation of our median employee in 2024 was $154,756. The ratio of these two amounts is approximately 44:1. This information is being provided for compliance purposes and 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 compensated employee 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. Accordingly, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies have different employee populations and compensation practices and may use different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios. Neither the Compensation Committee nor management of the company used the CEO Pay Ratio measure in making compensation decisions.
Methodology and Pay Ratio
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Methodology and Pay Ratio
Limitations on Liability and Indemnification Matters Our Restated Certificate contains provisions that eliminate the personal liability of our directors to the corporation or our stockholders for monetary damages for breach of fiduciary duty to the fullest extent permitted by the DGCL. Consequently, our directors are not personally liable to us or our stockholders for monetary damages for any breach of fiduciary duties as directors, except liability for: •any breach of the director’s duty of loyalty to us or our stockholders; •any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law; •unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the DGCL; or •any transaction from which the director derived an improper personal benefit. Our Restated Certificate and our amended and restated bylaws require us to indemnify our directors and officers to the maximum extent not prohibited by the DGCL and allow us to indemnify other employees and agents as authorized by the Board of Directors or by the action of a committee of the Board of Directors or designated officers established by or designated in resolutions approved by the Board of Directors. Subject to certain limitations, our amended and restated bylaws also require us to advance expenses incurred by our directors and officers for the defense of any action for which indemnification is required or permitted. We have entered, and intend to continue to enter, into separate indemnification agreements with our directors, officers and certain other employees, in addition to the indemnification provided for in our Restated Certificate and amended and restated bylaws. These agreements, among other things, require us to indemnify our directors, officers and certain other employees for certain expenses, including attorneys’ fees, judgments, penalties, fines and settlement amounts actually incurred by these individuals in any action or proceeding arising out of their service to us or any of our subsidiaries or any other company or enterprise to which these individuals provide services at our request. Subject to certain limitations, our indemnification agreements also require us to advance expenses incurred by our directors, officers and certain other employees for the defense of any action for which indemnification is required or permitted. We believe that provisions of our Restated Certificate, amended and restated bylaws and indemnification agreements are necessary to attract and retain qualified directors, officers and employees. We also maintain directors’ and officers’ liability insurance. The limitation of liability and indemnification provisions in our Restated Certificate and amended and restated bylaws or in these indemnification agreements may discourage stockholders from bringing a lawsuit against our directors and officers for breach of their fiduciary duty. They may also reduce the likelihood of derivative litigation against our directors and officers, even though an action, if successful, might benefit us and other stockholders. Further, a stockholder’s investment may be adversely affected to the extent that we pay the costs of settlement and damage awards against directors and officers as required by these indemnification provisions. Insofar as indemnification for liabilities arising under the Securities Act may be permitted for directors, executive officers or persons controlling us, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. Rule 10b5-1 Sales Plans Certain of our directors and executive officers have adopted written plans, known as Rule 10b5-1 plans, in which they have contracted with a broker to buy or sell shares of our common stock on a periodic basis. Under a Rule 10b5-1 plan, a broker executes trades pursuant to parameters established by the director or executive officer when entering into the plan, without further direction from them. The director or executive officer may amend or terminate the plan in specified circumstances.
Methodology and Pay Ratio
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Methodology and Pay Ratio
Equity Compensation Plan Information See discussion under the section titled “Proposal No. 5 Approval of Amendment to Veracyte, Inc. 2023 Equity Incentive Plan—Equity Compensation Plan Information.”
Methodology and Pay Ratio
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Methodology and Pay Ratio
Report of the Audit Committee of the Board of Directors The Audit Committee acts pursuant to a written charter that was adopted by the Board of Directors. Each member of the Audit Committee qualifies as “independent” under the current listing requirements of The Nasdaq Stock Market. In performing its functions, the Audit Committee acts in an oversight capacity and necessarily relies on the work and assurances of Veracyte’s management, which has the primary responsibility for financial statements and reports, and of the independent registered public accounting firm, who, in their report, express an opinion on the conformity of Veracyte’s annual financial statements with accounting principles generally accepted in the United States. It is not the duty of the Audit Committee to plan or conduct audits, to determine that Veracyte’s financial statements are complete and accurate and are in accordance with generally accepted accounting principles, or to assess or determine the effectiveness of Veracyte’s internal control over financial reporting. Within this framework, the Audit Committee has reviewed and discussed with management our audited financial statements as of and for the year ended December 31, 2024. The Audit Committee has also discussed Auditing Standard No. 1301 adopted by the Public Company Accounting Oversight Board (United States) regarding “Communications with Audit Committees.” In addition, the Audit Committee has received the written disclosures and the letter from the independent registered public accounting firm required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent registered public accounting firm’s communications with the Audit Committee concerning independence, and has discussed with the independent registered public accounting firm the independent registered public accounting firm’s independence. Based upon these reviews and discussions, the Audit Committee recommended to the Board of Directors that the audited financial statements be included in our Annual Report on Form 10-K for the year ended December 31, 2024.
Is cumulative voting permitted for the election of directors?
Is cumulative voting permitted for the election of directors? Stockholders may not cumulate votes in the election of directors, which means that each stockholder may vote no more than the number of shares he or she owns for a single director candidate.