DEF 14A of SI-BONE, Inc., Apr 29, 2024

DEF 14A of SI-BONE, Inc.

Filed Apr 29, 2024 · FY20230001459839-24-000031

Open on EDGAR

  1. ELECTION OF DIRECTORS

    ELECTION OF DIRECTORS Our Board of Directors is divided into three classes. Each class consists, as nearly as possible, of one-third of the total number of directors, and each class has a three-year term. Vacancies on the Board may be filled only by persons elected by a majority of the remaining directors. A director elected by the Board of Directors to fill a vacancy in a class, including vacancies created by an increase in the number of directors, shall serve for the remainder of the full term of that class and until the director’s successor is duly elected and qualified. Our Board of Directors currently has nine members. There are three directors in Class III, the class the term of which expires in 2024: Helen Loh, Mika Nishimura and Keith C. Valentine. Each is currently a member of our Board of Directors. Ms. Nishimura has been nominated for re-election as a director at the Annual Meeting. Ms. Loh and Mr. Valentine are not standing for re-election and will therefore step down as directors and as members of the Nominating and Corporate Governance Committee upon the expiration of their terms at the conclusion of the Annual Meeting. Our Nominating and Corporate Governance Committee, following a thorough search process, has recommended that the Board of Directors nominate Thomas A. West to stand for election to our Board of Directors as a member of Class III alongside Ms. Nishimura. Our Board of Directors has nominated Mr. West to fill one of the vacancies created on our Board of Directors immediately following the expiration of the terms of Ms. Loh and Mr. Valentine at the conclusion of the Annual Meeting. Accordingly, the size of our Board of Directors will be reduced to eight directors effective at the close of the Annual Meeting. If elected at the Annual Meeting, each of the nominees would serve until the 2027 annual meeting and until his or her successor has been duly elected and qualified, or, if sooner, until the director’s death, resignation or removal. It is our policy to encourage directors and nominees for director to attend the Annual Meeting. All nine of our current directors attended our 2023 annual meeting of stockholders. Ms. Nishimura was previously elected by our stockholders. The following table presents, for the Class III nominees for election at the Annual Meeting and our other directors who will continue in office after the Annual Meeting, their independence and position or office held, as well as their age as of March 31, 2024:

  2. ELECTION OF DIRECTORS

    | Name | Age | Position | Class | | Mika Nishimura | 60 | Director | III | | Thomas A. West | 60 | Director | III | | Timothy "Ted" Davis | 53 | Lead Independent Director | I | | Laura A. Francis | 57 | CEO | I | | Jeryl L. Hilleman | 66 | Director | I | | Jeffrey W. Dunn | 69 | Chairman | II | | John G. Freund, M.D. | 70 | Director | II | | Gregory K. Hinckley | 77 | Director | II |

  3. ELECTION OF DIRECTORS

    The following is a brief biography of each nominee and each director whose term will continue after the Annual Meeting.

  4. NOMINEES FOR ELECTION FOR A THREE-YEAR TERM EXPIRING AT THE 2027 ANNUAL MEETING

    NOMINEES FOR ELECTION FOR A THREE-YEAR TERM EXPIRING AT THE 2027 ANNUAL MEETING Mika Nishimura has served as a member of our Board of Directors since March 2021. Since 2011, Ms. Nishimura has served as an Operational Partner with Gilde Healthcare Partners, a life-science venture fund. Ms. Nishimura has served as a board member and the chair of the Nominating and Corporate Governance Committee for Accuray, Incorporated, a radiation therapy company since August 2021, and has served as a board advisor to Tristel, plc, a UK-based company since January 2021. Since June 2022, Ms. Nishimura has served as a member of the board of directors and the Audit, Compensation, and Nominating committees, and is the chair of the Healthcare Compliance Committee of HOYA Corporation. From 2016 to April 2020, Ms. Nishimura was Vice President, Commercialization at nVision Medical Corporation, an early clinical-stage company focused on early detection of ovarian cancer acquired by Boston Scientific. From 2011 to 2015, Ms. Nishimura was Vice President, Commercial Development at Auxogyn, which was acquired by Progyny, Inc. in 2015. Earlier in her career, Ms. Nishimura was Vice President, International Sales Operations and Marketing at ev3 Inc. Ms. Nishimura has a BA in Economics from Yale University and an MBA from Harvard Graduate School of Business Administration. We believe that Ms. Nishimura’s experience working for medical device companies across multiple phases of commercialization will enable her to make valuable contributions to our Board of Directors. Thomas A. West has served since August 2022 as the President and Chief Executive Officer and as a member of the board of directors of Nalu Medical, Inc., a medical device company focused on developing and commercializing innovative and minimally invasive neurostimulation solutions for patients with chronic neuropathic pain. Prior to joining Nalu, Mr. West served from July 2019 to July 2022 as President, Chief Executive Officer and Director at Intersect ENT, Inc., a publicly traded sinus surgery innovator in the medical device and pharmaceutical space acquired by Medtronic plc in May 2022. Mr. West has over 30 years of medical technology experience including as Worldwide President, Diagnostic Solutions at Hologic, Inc., from October 2014 to July 2019, and previously as President of LifeScan at Johnson & Johnson. He began his healthcare career at Johnson & Johnson in 1992, assuming roles of increasing responsibility and has directly led and supported businesses around the globe in medical devices, pharmaceuticals, and consumer healthcare. Since April 2023, Mr. West has served as a member of the Board of Inogen, Inc., a publicly traded innovator in respiratory devices and he previously served as a member of the Board of Directors of Orthofix Medical, Inc., a publicly traded leader in spine, orthopedics, and biologic solutions, from December 2021 to January 2023. Mr. West received a B.A. in Politics and Economics from Princeton University and an M.B.A. from the University of Pennsylvania, Wharton School. We believe that Mr. West’s extensive experience in the medical device industry will enable him to make valuable contributions to our Board of Directors.

  5. THE BOARD OF DIRECTORS RECOMMENDS

    THE BOARD OF DIRECTORS RECOMMENDS

  6. A VOTE IN FAVOR OF EACH NAMED NOMINEE

    A VOTE IN FAVOR OF EACH NAMED NOMINEE

  7. DIRECTORS CONTINUING IN OFFICE UNTIL THE 2025 ANNUAL MEETING

    DIRECTORS CONTINUING IN OFFICE UNTIL THE 2025 ANNUAL MEETING Timothy E. Davis, Jr. has served as a member of our Board of Directors since our inception in April 2008. Mr. Davis has served as President and Chief Executive Officer of BioTissue Holdings Inc., a privately held company focusing on the development and clinical application of human birth tissue-based products for the ocular and surgical clinical markets, since January 2022. From February 2017 through December 2021, Mr. Davis served as President and Chief Executive Officer of Active Implants, LLC, a company that provides orthopedic implant solutions. From January 2014 through September 2015, Mr. Davis served as Chief Executive Officer of MicroPort Orthopedics, Inc., a multinational producer of orthopedic products, following the purchase of Wright Medical Group’s OrthoRecon Business in January 2014. From December 2006 to January 2014, Mr. Davis served in a number of executive positions for Wright Medical Technology, Inc., a subsidiary of Wright Medical Group, Inc., including President of the OrthoRecon business. From 2004 to 2006, Mr. Davis was a Partner with MB Venture Partners, LLC, a medical technology and life sciences venture capital firm. From 1997 to 2004, Mr. Davis held various positions, ultimately serving as Vice President, with Vector Fund Management, a healthcare and life sciences focused venture capital fund. Early in his career, Mr. Davis worked in the healthcare management consulting and pharmaceutical industries. Mr. Davis received a B.E. degree in Biomedical Engineering from Vanderbilt University and an M.B.A. from the J.L. Kellogg Graduate School of Management at Northwestern University. We believe Mr. Davis’ experience in the industry, his experience in compensation matters, and his knowledge of our company enable him to make valuable contributions to our Board of Directors. Laura A. Francis has served as our Chief Executive Officer and as a member of our Board of Directors since April 2021. Previously, she served as our Chief Operating Officer from July 2019 to April 2021, and as our Chief Financial Officer from May 2015 to April 2021. Prior to joining us, Ms. Francis was the Chief Financial Officer for Auxogyn, Inc., a women’s health company, from December 2012 to September 2014. From September 2004 to December 2012, Ms. Francis served as Vice President of Finance, Chief Financial Officer and Treasurer for Promega Corporation, a life science reagent company. From March 2002 to September 2004, Ms. Francis served as the Chief Financial Officer of Bruker BioSciences Corporation, a public life science instrumentation company. From May 2001 to March 2002, Ms. Francis served as Chief Operating Officer and Chief Financial Officer of Nutra-Park Inc., an agricultural biotechnology company. From April 1999 to May 2001, Ms. Francis was Chief Financial Officer of Hypercosm, Inc., a software company. From October 1995 to April 1999, Ms. Francis was an engagement manager with McKinsey & Company, a consulting firm. Early in her career, Ms. Francis was an audit manager with Coopers & Lybrand, an accounting firm. Since January 2019, Ms. Francis has served as a member of the board of directors of ShockWave Medical, Inc, a medical device company, including serving as chair of its audit committee and on its compensation committee. Ms. Francis received a B.B.A. from the University of Wisconsin and an M.B.A. from Stanford University. She is a Certified Public Accountant (inactive) in the State of California. We believe Ms. Francis’s experience in the industry, her role as our Chief Executive Officer, and her knowledge of our company enable her to make valuable contributions to our Board of Directors. Jeryl L. Hilleman has served as a member of our Board of Directors since December 2019. Ms. Hilleman brings extensive experience in life sciences and served as a public company CFO for close to 20 years. Most recently, from June 2014 to November 2019, Ms. Hilleman served as the Chief Financial Officer for Intersect ENT, Inc., a commercial medical device company. Prior to Intersect ENT, Ms. Hilleman served as Chief Financial Officer of several other public healthcare companies. Ms. Hilleman has served as a member of the board of directors and the chair of the Audit Committee of NovoCure, Limited and Minerva Neurosciences, Inc. since July 2018, and of HilleVax, Inc., a biopharmaceutical company, since April 2021. Ms. Hilleman previously served as a member of the board of directors of Xenoport, Inc., a biopharmaceutical company, from January 2005 to July 2016 and of Talis Biomedical Corporation, a biomedical company, from February 2021 to June 2022. Ms. Hilleman received a B.A. in History from Brown University and an M.B.A. from the Wharton School at the University of Pennsylvania. We believe Ms. Hilleman’s financial experience, experience with medical device companies and her knowledge of our company enable her to make valuable contributions to our Board of Directors.

  8. DIRECTORS CONTINUING IN OFFICE UNTIL THE 2026 ANNUAL MEETING

    DIRECTORS CONTINUING IN OFFICE UNTIL THE 2026 ANNUAL MEETING Jeffrey W. Dunn has served as our Chairman of our Board of Directors since our inception in April 2008, and as our President and Chief Executive Officer from April 2008 until April 2021. Prior to joining us, Mr. Dunn served as Chief Executive Officer of INBONE Technologies, Inc., an ankle replacement and small bone fusion medical device company, from December 2006 to April 2008, until its sale to Wright Medical Technology, Inc. in April 2008. From August 2000 to June 2006, Mr. Dunn was the Chief Executive Officer of Active Decisions, Inc., a software as a service business, until its sale to Knova Software, Inc. From December 1999 to June 2000, Mr. Dunn was the Chief Executive Officer of Velogic, Inc., an internet performance testing software company, until its sale to Keynote Systems Inc. From June 1999 to December 1999, Mr. Dunn was the Chief Executive Officer of EnterpriseLink Inc., a provider of enterprise Internet enablement software, until its sale to Merant, Inc. From November 1994 to June 1998, Mr. Dunn was Chief Executive Officer of AccelGraphics Inc., a 3D graphics system supplier, until its sale to Evans and Sutherland Computer Corporation. As well, during his career, Mr. Dunn held executive positions with Evans and Sutherland, Cygnet Systems, Inc., Avnet, Inc. and Xerox Corporation. Mr. Dunn received a B.A. from Colgate University and an M.B.A. from Babson College. We believe Mr. Dunn’s experience in the industry, his prior role as our President and Chief Executive Officer, and his knowledge of our company enable him to make valuable contributions to our Board of Directors. John G. Freund, M.D. has served as a member of our Board of Directors since January 2013. Dr. Freund founded Skyline Ventures, a venture capital firm, in October 1997 and served as a Managing Director until December 2022. In 2016, Dr. Freund co-founded and was Chief Executive Officer of Arixa Pharmaceuticals, Inc. an antibiotic company, which was acquired by Pfizer in October 2020. Prior to joining Skyline, Dr. Freund served as Managing Director in the private equity group of Chancellor Capital Management, a private capital investment firm. In November 1995, Dr. Freund co-founded Intuitive Surgical, Inc., a medical device company, and served on its board of directors until March 2000. From 1988 to 1994, he held various positions at Acuson Corporation, a maker of ultrasound equipment that is now part of Siemens, most recently as Executive Vice President. Prior to joining Acuson, Dr. Freund was a general partner of Morgan Stanley Venture Partners from 1987 to 1988. From 1982 to 1988, Dr. Freund was at Morgan Stanley & Co., an investment banking company, where he co-founded the Healthcare Group in the Corporate Finance Department in 1983. Dr. Freund has served on the board of directors of both Collegium Pharmaceuticals, Inc., a biotechnology company, and Sutro Biopharma, Inc., a biotechnology company, since February 2014. Dr. Freund also serves on the board of directors of a number of U.S. registered investment funds managed by affiliates of the Capital Group, Inc. He also previously served on the board of directors of a number of publicly traded companies, including Tetraphase Pharmaceuticals, Inc., a biopharmaceutical company, Map Pharmaceuticals, Inc., a biopharmaceutical company, MAKO Surgical Corp., a medical device company, Proteon Therapeutics, Inc., a biotechnology company, Concert Pharmaceuticals, Inc., a biopharmaceutical company and XenoPort, Inc., a biopharmaceutical company, where he served as Chairman. Dr. Freund is a member of the Advisory Board for the Harvard Business School Healthcare Initiative. Dr. Freund received a B.A. in History from Harvard College, an M.D. from Harvard Medical School, and an M.B.A. from Harvard Business School, where he was a Baker Scholar. We believe Dr. Freund’s experience with medical device companies, his role in the venture capital industry, and his knowledge of our company enable him to make valuable contributions to our Board of Directors. Gregory K. Hinckley has served as a member of our Board of Directors since January 2011. Mr. Hinckley served as President of Mentor Graphics Corporation, an electronic design automation company, from November 2000 until his retirement in July 2017, and served on the board of directors from January 1999 to June 2016. From January 1997 to November 2000, he served as Executive Vice President. He has also served as the Chief Financial Officer of Mentor Graphics, first from January 1997 to July 2007 and again from December 2008 to July 2017. Previously, he served on the board of directors of Super Micro Computer, Inc., a manufacturer of servers, from January 2009 to February 2015; Intermec, Inc., a developer of automated identification and data collection solutions, from July 2004 to September 2013; and Amkor Technology, a semiconductor test and assembly company, from November 1997 to July 2007. From August 1992 to January 1997, Mr. Hinckley served as Senior Vice President, Finance of VLSI Technology, Inc., a designer and manufacturer of custom and semi-custom integrated circuits. From January 1989 to November 1991, he served as Senior Vice President and Chief Financial Officer of Crowley Maritime Corporation, a marine solutions, transportation, and logistics company. From February 1983 to January 1989, Mr. Hinckley served as Vice President and Chief Financial Officer, and since April 2017, Mr. Hinckley has served on the board of directors of Bio-Rad Laboratories, a manufacturer and supplier of products and systems for the life science research and healthcare markets. Previously, Mr. Hinckley held a number of senior officer positions with Raychem Corporation, a developer of products and services for the aerospace, automotive and telecommunications industries. Mr. Hinckley received a B.A. in Physics and Mathematics from Claremont McKenna College and was a Fulbright Scholar in applied mathematics at Nottingham University. He received an M.S. in Applied Physics from the University of California, San Diego and an M.B.A. from Harvard Business School. We believe Mr. Hinckley’s financial experience, his familiarity of serving on the boards of public companies, and his knowledge of our company enable him to make valuable contributions to our Board of Directors. Each of our directors, other than Mr. Dunn and Ms. Francis, is independent as defined under the Nasdaq Global Market listing standards. See “Independence of the Board of Directors” immediately below.

  9. INFORMATION REGARDING THE BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

    INFORMATION REGARDING THE BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

  10. Overview

    | | What We Do | | What We Don’t Do | | ✓ | Actively engage in year-round dialogue with our stockholders and incorporate feedback into our compensation programs | ✗ | No pension plans or Supplemental Executive Retirement Plans | | ✓ | Provide compensation mix that more heavily weights variable pay and long-term equity | ✗ | No hedging or pledging of our securities | | ✓ | Stock ownership requirements apply to all Named Executive Officers and directors | ✗ | No excise tax gross-ups upon a change of control | | ✓ | An independent compensation consultant advises the Compensation Committee | ✗ | No significant perquisites to our Named Executive Officers | | ✓ | Annually assess the risk-reward balance of our compensation programs in order to mitigate undue risks in our programs | ✗ | No single-trigger equity acceleration or excessive severance benefits | | ✓ | Maintain a fully independent Compensation Committee | | | | ✓ | We have adopted a clawback policy that provides for the recoupment of incentive compensation in the case of a financial restatement | | | | ✓ | Our Board maintains a robust succession strategy | | |

  11. Compensation Philosophy and Guiding Principles

    Compensation Philosophy and Guiding Principles We have designed our executive compensation program to reward our Named Executive Officers 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 that competitive compensation packages consisting of a combination of base salaries, annual cash bonus opportunities, and long-term incentive opportunities in the form of equity awards that are earned over a multi-year period enable us to attract top talent, motivate successful short-term and long-term performance, satisfy our retention objectives, and align the compensation of our Named Executive Officers with our performance and long-term value creation for our stockholders. The Compensation Committee periodically reviews and analyzes market trends and the prevalence of various compensation delivery vehicles and adjusts the design and operation of our executive compensation program from time to time as it deems necessary and appropriate. In designing and implementing the various elements of our executive compensation program, the Compensation Committee considers market and industry practices, as well as the tax efficiency of our compensation structure and its impact on our financial condition. While the Compensation Committee considers all of the factors in its deliberations, it places no formal weighting on any one factor. As we continue to grow, the Compensation Committee evaluates our compensation philosophy and program objectives as circumstances require. At a minimum, the Compensation Committee reviews executive compensation annually.

  12. Say-on-Pay Vote Results

    Say-on-Pay Vote Results At our Annual Meeting of stockholders in June 2023, our stockholders had the opportunity to cast an annual advisory vote on the compensation of our Named Executive Officers (commonly known as a “say-on-pay” vote). Approximately 92% of the votes cast on the proposal approved, on an advisory basis, the compensation of our Named Executive Officers as disclosed in last year's proxy statement. Although the vote is non-binding, our Compensation Committee considers the results of the say-on-pay vote when making compensation decisions, allowing our stockholders to provide input on our compensation philosophy, policies and practices. The Compensation Committee believes that our voting results reflect the company's efforts to properly align pay with performance while also aligning management and stockholder interests. We value the opinions of our stockholders, and our Compensation Committee and Board of Directors will continue to consider the outcome of future advisory votes, including the say-on-pay vote which will take place at the Annual Meeting, when making compensation decisions for the Named Executive Officers. Engagement on Executive Compensation Even though we received support from shareholders holding approximately 92% of our shares, we nonetheless reached out in late 2023 - early 2024 to holders of 71.1% of our outstanding common stock, seeking to engage with them on executive compensation and other governance topics. We held discussions with holders of 57.9% of our outstanding common stock, including 15 of our top 25 stockholders. We found these discussions to be extremely useful and received valuable feedback on our executive compensation program. Specific items of feedback relating to executive compensation that we heard through these engagements included: •An interest in detailed drivers of the annual bonus program •Acknowledgement of the continued alignment in our long-term incentive awards between the relative returns to our stockholders and the size and value of the equity awards granted to our Chief Executive Officer and Chief Financial Officer •Affirmation that our PSU program based on Relative TSR remains an effective way of further aligning management compensation with returns to our shareholders, and remains the preferred structure for performance-based equity amount our shareholders In response to this feedback, we took the following actions: •We are providing additional detail in this proxy statement on the operation of the 2023 annual bonus program and the factors in the Compensation Committee’s determination of achievement levels. We intend to continue to initiate dialog with our stockholders on executive compensation and other governance topics. In addition, we welcome stockholder communication with the Board through the channels set forth in this proxy statement.

  13. Compensation-Setting Process

    The Compensation Committee has assessed the independence of Compensia taking into account, among other things, the various factors as set forth in Exchange Act Rule 10C-1 and the enhanced independence standards and factors set forth in the applicable listing standards of the Nasdaq Stock Market, and has concluded that its relationship with Compensia and the work of Compensia on behalf of the Compensation Committee has not raised any conflict of interest. Competitive Positioning Given our unique business profile, history, and market competitors, the Compensation Committee believes that the competitive market for executive talent includes primarily medical device and equipment companies and, to a lesser extent, the broader healthcare sector. Accordingly, it develops a compensation peer group to contain a carefully selected cross-section of such public companies with revenues and market capitalizations that are similar to ours, using factors described below. The Compensation Committee considers the compensation practices of these peer group companies as one factor in its compensation deliberations. This peer group data is supplemented with executive compensation survey data representing public medical device, technology, and life sciences companies that are of similar size to SI-BONE, as well as market trends and best practices in executive compensation and the judgment of the Compensation Committee members. Other important factors taken into consideration when determining executive pay levels include employee knowledge, skills and experience; individual performance; scope of responsibilities; and any retention concerns. 2023 Compensation Peer Group In September 2022, the Compensation Committee, with the assistance of Compensia, approved of the following target criteria for determining the composition of our peer group for purposes of evaluating the compensation of our Named Executive Officers for 2023. •Revenue: 0.4x to 2.5x our revenue •Market capitalization: 0.25x to 4.0x our market capitalization •Industry: medical device and equipment •Location: public companies headquartered in the United States The following 17 companies were selected by the Compensation Committee as the defined peer group for purposes of 2023 executive compensation decisions:

  14. Compensation Elements

    The actual base salaries earned by our Named Executive Officers during 2023 are set forth in the “2023 Summary Compensation Table” below. Annual Cash Bonuses We use annual bonuses to motivate our management team, including our Named Executive Officers, to achieve our short-term financial and operational objectives while making progress towards our longer-term growth and other goals. Consistent with our executive compensation philosophy, these annual bonuses are intended to help us deliver a competitive total direct compensation opportunity to our management team. Annual cash bonuses are entirely performance-based, are not guaranteed, and may vary materially from year-to-year. Typically, the Compensation Committee establishes (recommends to our Board of Directors in the case of our CEO) cash bonus opportunities pursuant to a formal cash bonus plan that measures and rewards our management team for our actual corporate performance over the fiscal year. The cash bonus plan is designed to pay above-target bonuses when we exceed our annual corporate objectives and below-target bonuses (or no bonuses) when we do not achieve these objectives. In January 2023, the Compensation Committee determined to award (recommend to our Board of Directors in the case of our CEO) cash bonus opportunities to our Named Executive Officers, pursuant to the corporate bonus plan for 2023. The Compensation Committee has the authority to select the performance measures and related target levels applicable to the annual cash bonus opportunities for our Named Executive Officers. The Compensation Committee may also, in its sole discretion, increase, reduce, or eliminate a participant’s actual bonus payment. Target Bonus Opportunities The 2023 target annual cash bonus opportunities for each of our Named Executive Officers under the 2023 bonus plan, expressed as a percentage of his or her annual base salary, were as follows:

  15. Compensation Elements

    | Named Executive Officer | 2023 Base Salary | 2023 Target Bonus Percentage | Total 2023 Target Bonus Opportunity | | Laura Francis | $622,120 | 85% | $528,802 | | Anshul Maheshwari | $439,000 | 50% | $219,500 | | Anthony Recupero | $472,000 | 75% | $354,000 |

  16. Compensation Elements

    The target annual cash bonus opportunities of our management team, including the Named Executive Officers, were driven entirely by achievement of corporate financial and operational objectives. The Compensation Committee determined this allocation to be appropriate to focus our management team on our short-term financial objectives as reflected in our annual operating plan while, at the same time, recognizing their contributions to the achievement of these objectives and the successful execution of their individual roles and responsibilities. Corporate Performance Objectives For purposes of the 2023 bonus plan, the Compensation Committee selected the following as the corporate performance measures. ◦Revenue growth, weighted 50%; ◦Adjusted EBITDA, weighted 20%; ◦New product milestones ((i) Product Development Project #1, (ii) Product Development Project #2, and (iii) Product Development Project #3), weighted 20%; and ◦Voluntary attrition rate, weighted 10%. The Compensation Committee believed these performance measures were appropriate for our business because they provide a balance between generating revenue, managing our expenses, and growing our business, which it believes most directly influence long-term stockholder value. At the same time, the Compensation Committee established target performance levels for each of these measures at levels that it believed to be challenging, but attainable, through the successful execution of our annual operating plan. The threshold, target, and maximum levels of achievement for each corporate performance measure and their respective payment amounts, with the actual bonus payment with respect to each measure to be determined independently, were as follows. Potential payouts under the plan range from 0% if the threshold performance level is not met, 80% of target at threshold performance, and up to 125% of target at or above maximum performance.

  17. Compensation Elements

    | Corporate Performance Measure | Weight | Actual Achievement | Achievement Payout Level | Bonus Contribution | | Revenue growth | 50% | 30.5% | 125.0% | 62.5% | | Adjusted EBITDA | 20% | ($17.3M) | 120.0% | 24.0% | | Product Development Project #1 | 10% | July | 125.0% | 12.5% | | Product Development Project #2 | 5% | October | 125.0% | 6.25% | | Product Development Project #3 | 5% | October | 125.0% | 6.25% | | Voluntary Attrition Rate (year over year) | 10% | Down 1% | 100.0% | 10.0% | | | | | Total | 121.5% |

  18. Compensation Elements

    | Named Executive Officer | Target Annual Cash Bonus Opportunity | Bonus Achievement Percentage | Actual Annual Cash Bonus Payment | | Laura Francis | $528,802 | 121.5% | $642,494 | | Anshul Maheshwari | $219,500 | 121.5% | $266,693 | | Anthony Recupero | $354,000 | 121.5% | $430,110 |

  19. Compensation Elements

    The actual annual cash bonuses paid to our Named Executive Officers for 2023 are also set forth in the “2023 Summary Compensation Table” below. Long-Term Incentive Compensation We use long-term incentive compensation in the form of equity awards to motivate our management team, including our Named Executive Officers, by providing them with the opportunity to build an equity interest in the company and to share in the potential appreciation of the value of our common stock. The Compensation Committee views equity awards, whether the awards are subject to time-based vesting requirements or are to be earned based on the attainment of specific performance objectives, as inherently variable since the grant date fair value of these awards may not necessarily be indicative of their value when, and if, the shares of our common stock underlying these awards are ever earned or vested. The Compensation Committee further believes these awards enable us to attract and retain key talent in our industry and align our management team's interests with the long-term interests of our stockholders. Generally, in determining the size of the equity awards granted to our Named Executive Officers, the Compensation Committee takes into consideration the recommendations of our CEO (except with respect to her own equity awards), and other factors, including the comparative awards granted to similar positions at our peer companies, the performance and expected performance of the executive officer, the existing equity holdings of each executive officer, including the current economic value of their unvested equity awards and the ability of these unvested holdings to satisfy our retention objectives, overall market data, and information provided by our compensation consultant. The Compensation Committee also considers the dilutive effect of our long-term incentive compensation practices, and the overall impact that these equity awards, as well as awards to other employees, will have on stockholder value. In January 2023, the Compensation Committee (or our Board of Directors in the case of our CEO) granted equity awards in the form of relative total shareholder return (“TSR”) PSU awards and RSU awards to our Named Executive Officers. Further, the Compensation Committee determined Ms. Francis’ 2023 long-term incentive mix would be 50% PSUs and 50% RSUs, and Messrs. Maheshwari and Recupero’s mix would be 25% PSUs and 75% RSUs. The Compensation Committee determined the mix of RSUs and PSUs for each of our Named Executive Officers with reference to market norms and predominant practices among our peer companies. The equity awards granted to our Named Executive Officers in 2023 were as follows:

  20. Compensation Elements

    | Named Executive Officer | Number of RSUs | Target Number of Relative TSR PSUs | Total Target Value1 | | Laura Francis | 70,252 | 70,252 | $2,026,000 | | Anshul Maheshwari | 57,478 | 19,159 | $1,105,000 | | Anthony Recupero | 57,478 | 19,159 | $1,105,000 |

  21. Compensation Elements

    (1) The amounts reported in this column represent the target value of equity awards made in 2023. This differs from the aggregate grant date fair value of awards as computed in accordance with FASB ASC 718 and reported in the “2023 Summary Compensation Table” below. Target values were converted to shares using our 60-trading day average stock price as of December 31, 2022. The PSU awards are designed to be earned based on our TSR as compared to a group of industry peers in equal tranches over one-, two-, and three-year performance periods. In each period, the target performance is the median of the industry peer group. A maximum payout of 200% of target is earned if the company’s performance exceeds the industry group median by 50 percentage points or more; no payout is earned if the company’s performance trails the industry group median by 50 percentage points or more.

  22. Compensation Elements

    | Achievement Level | Performance (Points vs. 50th Percentile Company) | Payout (% of Target) | | Maximum | ≥ +50 Point | 200% | | Target | Equal to 50th percentile company | 100% | | Threshold | -50 Point | 0% |

  23. Compensation Elements

    The PSUs include interim payout opportunities after the end of the first and second years of the three-year performance period. The first interim payout opportunity is capped at 100% of one-third of the target level payout for the PSUs, while up to 200% of one-third of the target shares associated with the second-year performance period may be earned following that performance period, based on relative TSR performance and continued service through the end of the relevant year. Up to 200% of the total target shares under the whole award may be earned after the conclusion of the three-year performance period based on relative TSR performance through the end of the three-year performance period, less any shares previously earned and paid out for the first and second interim periods. The group of relative TSR industry peers was selected using objective criteria determined in advance of the start of the performance period. For the 2023 awards, the Compensation Committee determined to include constituents of the S&P Healthcare Equipment Select Index and other executive compensation peers with market cap between ~0.25x and ~4.0x SI-BONE. The RSU awards granted to our Named Executive Officers in January 2023 were subject to a time-based vesting requirement providing that these awards are to vest quarterly over four years, assuming the continued service of the executive officers on each such vesting date. Earned PSU Awards As noted above, the PSUs include an interim payout opportunity after the end of the first and second years of the three-year performance period. Shares associated with the one-year performance period (one-third of total shares) are capped at the target level payout, while shares associated with the two-year performance period (one-third of total shares) may be earned at up to 200% of the target level payout, based on relative TSR performance and continued service through the end of each applicable year. For both the first year covered by the 2023 PSUs and the second year covered by the 2022 PSUs, we outperformed on a TSR basis the median issuer in our designated TSR industry peer group, resulting in payouts of 100% of target for FY23 Tranche One and 200% of target for FY22 Tranche Two. The first tranche of the 2023 PSUs would have paid out at 200% of the target shares eligible for release but for the cap of 100% on Year 1 achievement specified in our PSU grants.

  24. Compensation Elements

    | Award Tranche | SI-BONE TSR Performance vs. Median | Tranche Payout (% of Target) | | FY23 Tranche 1 | +63 Points | 1 | | FY22 Tranche 2 | +56 Points | 2 |

  25. SI-BONE, Inc. Severance Benefit Plan

    SI-BONE, Inc. Severance Benefit Plan On July 16, 2020, the Compensation Committee of our Board of Directors of SI-BONE, Inc. adopted the SI-BONE, Inc. Severance Benefit Plan (the “Severance Plan”), and form of Participation Agreement for use with the Severance Plan, pursuant to which participants in the Severance Plan, including our Named Executive Officers, will receive severance benefits if we terminate the participant’s employment with us without “cause” or the participant resigns his or her employment for “good reason” within three months prior to, or within 12 months following, a “change in control” of SI-BONE (as such terms are defined in the Severance Plan). Participants in the Severance Plan are those employees that have been designated as participants by the Board of Directors or Compensation Committee as participants in the Severance Plan and who have signed a Participation Agreement. All of our Named Executive Officers have been designated as participants in the Severance Plan. Severance payments to our Named Executive Officers in connection with a change in control are as follows: (1) a lump sum cash payment equal to 12 months base salary (18 months in the case of Ms. Francis), (2) a lump sum cash payment of the then current annual target cash bonus (1.5 times annual target cash bonus in the case of Ms. Francis), (3) COBRA coverage for 12 months (18 months in the case of Ms. Francis), (4) full acceleration of vesting of all equity awards, and (5) extension of the post-termination exercise period to two years (or the closing of the change in control if provided in the equity award or change in control agreement). In addition, in the event SI-BONE terminates the employment of an executive officer without cause other than within three months prior to or 12 months following a change in control, the executive officer will receive severance payments as follows: (1) a lump sum cash payment equal to 12 months base salary, and COBRA coverage for 12 months. To obtain benefits under the Severance Plan the participant must sign and deliver to SI-BONE a release of liability in favor of SI-BONE.

  26. Employment Arrangements

    Employment Arrangements We have offer letters with each of our Named Executive Officers. The offer letters generally provide for at-will employment and set forth the executive officer’s initial base salary, eligibility for employee benefits and confirmation of the terms of previously issued equity grants, including in some cases severance benefits on a qualifying termination of employment. In addition, each of our executive officers has executed our standard proprietary information and inventions agreement. Any severance provisions of the Named Executive Officers’ offer letters were superseded by the Severance Plan.

  27. Other Compensation Policies

    The non-employee Director guideline is based on the annual Board cash retainer and excludes additional cash retainers paid for Board committee service or for service as Chairperson or Lead Independent Director. Shares that count toward satisfaction of these ownership requirements include shares owned by the executive, including shares purchased on the open market. Unexercised options and unvested RSUs and PSUs do not count toward these ownership requirements. Executives have five years to comply with the applicable stock ownership requirement. As of the end of fiscal year 2023, our CEO, each of our other Named Executive Officers, and each of our non-employee Directors had satisfied his or her required stock ownership level or was on track to do so. Compensation Recoupment Policy In 2023, our Board of Directors adopted a new Compensation Recoupment Policy (“Clawback Policy”) applicable to our CEO and all of our current and former executive officers. Under this policy, our Compensation Committee is obligated to recover excess incentive compensation received by any executive officer covered by our Clawback Policy on or after October 2, 2023, if any, in the event SI-BONE is required to prepare an accounting restatement due to material noncompliance with any financial reporting requirement under the securities laws. For purposes of this policy, excess incentive compensation means the amount of certain incentive-based compensation actually received by the covered executive officer, minus the amount of such incentive-based compensation that otherwise would have been received had the incentive compensation been determined based on the applicable restated amounts. The Compensation Committee will not consider the executive officer’s responsibility or fault in enforcing our Clawback Policy to recoup the amount described above. This Policy is intended to comply with, and will be interpreted in a manner consistent with, Section 10D of the Securities Exchange Act of 1934 (the “Exchange Act”), with Exchange Act Rule 10D-1 and with the Nasdaq listing standards. Hedging and Pledging Policies Under our Insider Trading Policy, no director, employee or consultant to SI-BONE may engage in short sales, transactions in put or call options, hedging transactions, margin accounts, pledges, or other inherently speculative transactions with respect to our stock at any time.

  28. Tax and Accounting Considerations

    Tax and Accounting Considerations The Compensation Committee takes the applicable tax and accounting requirements into consideration in designing and overseeing our executive compensation program. Deductibility of Executive Compensation For federal income tax purposes, publicly traded companies may be prohibited from deducting employee remuneration in excess of $1 million paid to certain “covered employees,” which may include certain Named Executive Officers, including, but not limited to, our Chief Executive Officer and Chief Financial Officer, under Section 162(m) of the Internal Revenue Code (the “Code”). Even if Section 162(m) may limit the compensation deduction, our Board of Directors and the Compensation Committee believe our compensation policies and practices should be designed to help us meet our established goals and objectives. While the Compensation Committee will consider the impact of the Section 162(m) deduction limitation, it intends to continue to compensate our executive officers, including our Named Executive Officers, in a manner that is in the best interest of our stockholders and reserves the right to make compensation decisions that may not be deductible under Section 162(m) where the Compensation Committee determines the compensation to be appropriate and in the best interests of the company and our stockholders. Section 409A Considerations Section 409A of the Code affects the manner by which deferred compensation opportunities are offered to our employees because Section 409A requires, among other things, that “non-qualified deferred compensation” be structured in a manner that limits employees’ ability to accelerate or further defer certain kinds of deferred compensation. We intend to operate our existing compensation arrangements that are covered by Section 409A in accordance with the applicable rules thereunder, and we will continue to review and amend our compensation arrangements where necessary to comply with Section 409A. Accounting for Stock-Based Compensation The Compensation Committee takes accounting considerations into account in designing compensation plans and arrangements for our executive officers and other employees. Chief among these is ASC Topic 718, the standard which governs the accounting treatment of certain stock-based compensation. Among other things, ASC Topic 718 requires us to record a compensation expense in our income statement for all equity awards granted to our executive officers and other employees. This compensation expense is based on the grant date “fair value” of the equity award and, in most cases, will be recognized ratably over the award’s requisite service period (which, generally, will correspond to the award’s vesting schedule). This compensation expense is also reported in the compensation tables below, even though recipients may never realize any value from their equity awards.

  29. Summary Compensation Table

    Summary Compensation Table The following table shows for the fiscal years ended 2023 and 2022 compensation awarded to or paid to, or earned by, our Named Executive Officers.

  30. Summary Compensation Table

    Summary Compensation Table

  31. Summary Compensation Table

    | Name and Principal Position | Year | Salary | Stock Awards(1) | Non-Equity Incentive Plan Compensation(2) | Total | | Laura A. Francis | 2023 | $622,120 | $2,449,257 | $642,494 | $3,713,871 | | Chief Executive Officer | 2022 | $604,000 | $3,785,800 | $504,159 | $4,893,959 | | Anthony J. Recupero | 2023 | $472,000 | $1,154,988 | $430,110 | $2,057,098 | | President, Commercial Operations | 2022 | $458,000 | $1,561,228 | $337,317 | $2,356,545 | | Anshul Maheshwari | 2023 | $439,000 | $1,154,988 | $266,693 | $1,860,681 | | Chief Financial Officer | 2022 | $426,000 | $1,516,636 | $188,249 | $2,130,885 |

  32. Summary Compensation Table

    (1) Represents the aggregate grant date fair value of restricted stock units granted to the officer, computed in accordance with FASB ASC Topic 718. The fair value of the restricted stock units is based on the market price of our common stock on the date of grant. We did not grant any stock options in 2022 and 2023. (2) Represents payments upon the achievement of 2023 and 2022 corporate goals, as applicable, as well as individual objectives, which were paid in the first quarter of 2024 and 2023, respectively.

  33. Outstanding Equity Awards at December 31, 2023

    Outstanding Equity Awards at December 31, 2023 The following table shows, certain information regarding outstanding equity awards at December 31, 2023, for our Named Executive Officers:

  34. Outstanding Equity Awards at December 31, 2023

    | | | | Option Awards(1) | | | | Stock Awards | | Equity Incentive Plan Awards (4) | | | | Grant Date | Vesting Commencement Date | Number of Securities Underlying Unexercised Options Vested (#) | Number of Securities Underlying Unexercised Options Unvested (2)(#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested(3) ($) | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested (3) ($) | | Laura A. Francis | 07/26/16 | 05/26/15 | 57,392 | — | 4.32 | 05/25/25 | — | — | — | — | | | 12/12/17 | 09/06/17 | 11,277 | — | 4.68 | 03/01/27 | — | — | — | — | | | 01/15/19 | 01/15/19 | 5,574 | — | 22.00 | 01/15/29 | — | — | — | — | | | 07/24/19 | 08/15/19 | — | — | — | — | — | — | — | — | | | 01/03/20 | 01/01/20 | — | — | — | — | 1,689 | 35,452 | — | — | | | 01/05/21 | 01/01/21 | — | — | — | — | 15,400 | 323,246 | — | — | | | 04/18/21 | 05/15/21 | — | — | — | — | 12,324 | 258,681 | — | — | | | 01/07/22 | 01/01/22 | — | — | — | — | 35,924 | 754,045 | 106,440 | 2,234,176 | | | 01/06/23 | 01/01/23 | — | — | — | — | 140,504 | 2,949,179 | 57,080 | 1,198,109 | | Anthony J. Recupero | 07/26/16 | 07/05/16 | 99,190 | — | 4.32 | 07/26/26 | — | — | — | — | | | 12/12/17 | 09/06/17 | 53,943 | — | 4.68 | 03/01/27 | — | — | — | — | | | 01/15/19 | 01/15/19 | 42,700 | — | 22.00 | 01/15/29 | — | — | — | — | | | 01/03/20 | 01/01/20 | — | — | — | — | 1,689 | 35,452 | — | — | | | 01/05/21 | 01/01/21 | — | — | — | — | 15,400 | 323,246 | — | — | | | 04/19/21 | 05/15/21 | — | — | — | — | 3,852 | 80,853 | — | — | | | 01/06/22 | 01/01/22 | — | — | — | — | 39,189 | 822,577 | — | — | | | 01/06/23 | 01/01/23 | — | — | — | — | 46,701 | 980,254 | 38,318 | 804,295 | | Anshul Maheshwari | 04/21/21 | 05/15/21 | — | — | — | — | 14,340 | 300,997 | — | — | | | 01/06/22 | 01/01/22 | — | — | — | — | 23,514 | 493,559 | 23,224 | 487,472 | | | 01/06/23 | 01/01/23 | — | — | — | — | 46,701 | 980,254 | 38,318 | 804,295 |

  35. Outstanding Equity Awards at December 31, 2023

    (1) Shares are subject to vesting as to 1/48 of the award upon continued service through each month following the vesting commencement date, through the fourth anniversary of the vesting commencement date. (2) The unvested shares subject to these options are subject to accelerated vesting in the event termination of the award recipient’s employment in connection with a change of control of the company. (3) For purposes of determining market value, we assumed a stock price of $20.99, the closing sale price per share of our common stock on December 31, 2023, the last business day of our last fiscal year. (4) This represents the maximum number of issuable shares under the awards. The target number of shares is 50% of the maximum shares.

  36. Pension Benefits

    Pension Benefits Our Named Executive Officers did not participate in, or otherwise receive any benefits under, any pension or retirement plan sponsored by us during 2023.

  37. Nonqualified Deferred Compensation

    Nonqualified Deferred Compensation Our Named Executive Officers did not participate in, or earn any benefits under, a nonqualified deferred compensation plan sponsored by us during 2023.

  38. Compensation of Non-Employee Board Members

    | Name | Fees Earned or Paid in Cash(1) | Non-Equity Incentive Plan Compensation | Stock Awards(2) | Total | | Timothy E. Davis, Jr. | $75,000 | | $136,297 | $211,297 | | Jeffrey W. Dunn (3) | 164,170 | 126,567 | 260,441 | 551,178 | | John G. Freund, M.D. | 52,000 | | 136,297 | 188,297 | | Jeryl L. Hilleman | 70,000 | | 136,297 | 206,297 | | Gregory K. Hinckley | 55,000 | | 136,297 | 191,297 | | Helen Loh(4) | 50,000 | | 136,297 | 186,297 | | Mika Nishimura | 52,000 | | 136,297 | 188,297 | | Keith C. Valentine(5) | 55,000 | | 136,297 | 191,297 |

  39. Non-Employee Director Compensation Policy

    Non-Employee Director Compensation Policy We have adopted a non-employee director compensation policy, pursuant to which our non-employee directors will be eligible to receive cash compensation for service on our Board and committees of our Board. Each non-employee director receives an annual cash retainer of $45,000 for serving on our Board. The chairperson and members of the three committees of our Board are entitled to the following annual cash retainers:

  40. Non-Employee Director Compensation Policy

    | Board Committee | Chairperson Fee | Member Fee | | Audit Committee | $20,000 | $10,000 | | Compensation Committee | 15,000 | 7,000 | | Nominating and Corporate Governance Committee | 10,000 | 5,000 | | Lead Independent Director | 5,000 | — | | Chair of the Board | 45,000 | — |

  41. Non-Employee Director Compensation Policy

    All annual cash compensation amounts are payable in equal quarterly installments in arrears, on the last day of each fiscal quarter for which the service occurred, pro-rated based on the days served in the applicable fiscal quarter. Each new non-employee director who joins our Board will receive a restricted stock unit award with a value of $250,000. The shares subject to these equity awards will vest ratably over 36 months, subject to the non-employee director’s continuous service with us on each applicable vesting date. In addition, under the policy, on the date of each annual meeting of our stockholders, each continuing non-employee director may receive a restricted stock unit award with a value of $120,000, vesting approximately one year from the grant date, subject to the non-employee director’s continuous service with us on each applicable vesting date. In the event of a change of control (as defined in the 2018 Plan), any unvested shares subject to these equity awards will fully vest and, in the case of stock options become exercisable, immediately prior to the effective date of such change of control, subject to the non-employee director’s continuous service with us on the effective date of the change of control.

  42. Pay Versus Performance

    Pay Versus Performance The compensation actually paid disclosed below for our Principal Executive Officer (“PEO”) and the average of our non-PEO Named Executive Officers “Non-PEO NEOs” was calculated in accordance with the requirements of Item 402(v) of Regulation S-K. The compensation actually paid figures presented in the table below incorporate total executive compensation as reported in the Summary Compensation Table adjusted for changes in the fair value of equity awards (we do not have any pension benefits). Accordingly, compensation actually paid does not equate to the amount that is actually paid to any executive in a given year and is merely a measurement determined by the SEC in an effort to identify the relationship between executive compensation and our financial performance. The following table sets forth the compensation actually paid to our PEO and average of our Non-PEO NEOs, serving in such capacity, along with certain measures of our performance in each of the three years ended December 31, 2023, December 31, 2022 and December 31, 2021:

  43. Pay Versus Performance

    | Year(1) | Summary Compensation Table Total for PEO#1(2) | Compensation Actually Paid to PEO#1 | Summary Compensation Table Total for PEO#2(3) | Compensation Actually Paid to PEO#2(4) | Average Summary Compensation Table Total for Non-PEO NEOs(5) | Average Compensation Actually Paid to Non-PEO NEOs(6) | Value of Initial Fixed $100 Investment Based On: | Net Loss (millions)(8) | | | | | | | | | Total Shareholder Return(7) | | | 2023 | $— | $— | $3,713,871 | $7,085,626 | $1,958,890 | $3,453,403 | $70 | $(43.34) | | 2022 | $— | $— | $4,893,959 | $2,616,198 | $2,243,715 | $1,185,889 | $45 | $(61.26) | | 2021 | $4,347,631 | $1,058,832 | $3,430,641 | $2,203,680 | $2,075,023 | $1,418,469 | $74 | $(56.57) |

  44. Pay Versus Performance

    (1) We are a smaller reporting company and, accordingly, we have not included any information in this table for 2019 and 2020. (2) The dollar amounts represent the amounts of total compensation reported for Mr. Dunn (our former CEO) for 2021 in the “Total” column of the Summary Compensation Table in our 2022 proxy statement. (3) The dollar amounts represent the amounts of total compensation reported for Ms. Francis (our current CEO) for each corresponding year in the “Total” column of the Summary Compensation Table. Refer to “Executive Compensation—Summary Compensation Table.” (4) The dollar amounts represent the amount of “compensation actually paid” to Ms. Francis, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual amount of compensation earned by or paid to Ms. Francis during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to Ms. Francis’s total compensation for 2023 to determine the compensation actually paid:

  45. Pay Versus Performance

    | Year | Summary Compensation Table Total | Minus Stock and Option Awards from Summary Compensation Table | Plus Year-End Equity Value of Unvested Awards Granted During Year | Plus Change in Value of Unvested Awards Granted in Prior Years | Plus Value of Awards Granted and Vested During Year | Plus Change in Value of Prior Years' Awards Vested During Year | Compensation Actually Paid | | 2023 | $3,713,871 | $2,449,257 | $4,018,631 | $1,002,852 | $297,952 | $501,577 | $7,085,626 |

  46. Pay Versus Performance

    (5) The dollar amounts represent the average of the amounts reported for our non-PEO NEOs as a group in the “Total” column of the Summary Compensation Table in each applicable year. The Non-PEO NEOs included for purposes of calculating the average amounts in each applicable year were Mr. Maheshwari and Mr. Recupero. (6) The dollar amounts represent the average amount of “compensation actually paid” to the Non-PEO NEOs as a group, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the Non-PEO NEOs as a group during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to average total compensation for the Non-PEO NEOs as a group for 2023 to determine the compensation actually paid, using the same methodology described above in footnote 4:

  47. Pay Versus Performance

    | Year | Avg. Summary Compensation Table Total | Minus Avg. Stock and Option Awards from Summary Compensation Table | Plus Avg. Year-End Equity Value of Unvested Awards Granted During Year | Plus Avg. Change in Value of Unvested Awards Granted in Prior Years | Plus Avg. Value of Awards Granted and Vested During Year | Plus Avg. Change in Value of Prior Years' Awards Vested During Year | Avg. Compensation Actually Paid | | 2023 | $1,958,890 | $1,154,988 | $1,749,296 | $418,790 | $243,780 | $237,635 | $3,453,403 |

  48. Pay Versus Performance

    (7) Cumulative TSR is calculated by dividing a fixed investment of $100 at the beginning of the measurement period (December 31, 2020) into a number of shares by the value of that investment at the end of the respective year plus the cumulative amount of dividends for the period, assuming dividend reinvestment. (8) The dollar amounts reported represent the amount of net loss reflected in our audited financial statements for the applicable year.

  49. Analysis of the Information Presented in the Pay Versus Performance Table

    Analysis of the Information Presented in the Pay Versus Performance Table As described in more detail above, our executive compensation program reflects a variable pay-for-performance philosophy. While we utilize several performance measures to align executive compensation with our performance, not all of those company measures are presented in the Pay Versus Performance table. Moreover, we generally seek to incentivize long-term performance, and therefore do not specifically align our performance measures with compensation that is actually paid (as computed in accordance with Item 402(v) of Regulation S-K) for a particular year. In accordance with Item 402(v) of Regulation S-K, we are providing the following descriptions of the relationships between information presented in the Pay Versus Performance table. Compensation Actually Paid and Cumulative TSR The following graph shows the relationship between compensation actually paid and TSR. TSR shows the cumulative total return on an investment of $100 in cash in our common stock on December 31, 2020 through December 31, 2023, assuming that any dividends were reinvested. The return shown on the graph below is not necessarily indicative of future performance, and we do not make or endorse any predictions as to future stockholder returns. Compensation Actually Paid and Net Loss The following graph shows the relationship between compensation actually paid and Net Loss: All information provided above under the “Pay Versus Performance” heading will not be deemed to be incorporated by reference into any filing of SI-BONE under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing, except to the extent we specifically incorporate such information by reference.