DEF 14A of AST SpaceMobile, Inc.
Filed Jul 30, 2024 · FY20230001493152-24-029625
PROPOSAL NO. 1 - ELECTION OF DIRECTORS
PROPOSAL NO. 1 - ELECTION OF DIRECTORS The Company’s Bylaws provide that the Board shall consist of no less than five or more than 19 directors, with the number of directors being fixed by the Board within such range subject to the restrictions set forth in the Stockholders’ Agreement. Per the Stockholders’ Agreement, the Board shall consist of 13 directors. Each director is elected to serve for a one-year term that expires at the Company’s next Annual Meeting of Stockholders. All of the Company’s current directors have been nominated for election at the Annual Meeting to serve for a term expiring at the Company’s 2025 annual meeting of stockholders. Pursuant to the Stockholders’ Agreement, Messrs. Sarnoff, Torres, Rubin, and Wibergh were nominated by Mr. Avellan. Likewise, pursuant to the Stockholders’ Agreement, Ms. Cisneros was nominated by Antares; Mr. Ibbetson was nominated by Vodafone; Mr. Knapp was nominated by American Tower; Mr. Mikitani was nominated by Rakuten USA; and Mr. Sambar was nominated by AT&T. Each of the director nominees has consented to serve for his or her term if elected. If any director nominee should become unavailable to serve as a director, the Board may designate a substitute nominee. In that case, the individuals named as proxies will vote for the substitute nominee designated by the Board. Each of our directors, except for Messrs. Wibergh and Sambar, has served on our Board since 2021. Mr. Avellan also served as a director of AST LLC since 2017. The affirmative vote of a plurality of the total votes cast for directors at the Annual Meeting is necessary to elect a director. No cumulative voting is permitted. Accordingly, as 10 directors are up for election at the Annual Meeting, the 10 nominees receiving the highest number of votes cast “for” will be elected. Only votes “for” will affect the outcome.
Directors Standing For Election
Directors Standing For Election
ABEL AVELLAN
ABEL AVELLAN Mr. Avellan, age 53, is the Founder, Chairman, and Chief Executive Officer of AST LLC since its inception in 2017 and has served as the Company’s Chairman of the Board of Directors and Chief Executive Officer since April 2021. Prior to founding the Company, Mr. Avellan served as the founder and Chief Executive Officer of Emerging Markets Communications (“EMC”), a satellite-based communications services provider to maritime and other mobility markets, from 2000 until its sale to Global Eagle Entertainment Inc. for $550.0 million in July 2016. Following the acquisition of EMC, Mr. Avellan worked as the President and Chief Strategy Officer for Global Eagle Entertainment Inc. until April 2017. Mr. Avellan has over 25 years of success in the space industry and is the co-inventor of 21 U.S. patents. He was the recipient of the Satellite Transaction of the Year award by Euroconsult in 2015, was named Satellite Teleport Executive of the Year in 2017 and in February 2024 was named a Commissioner to the ITU/UNESCO Broadband Commission for Sustainable Development. Mr. Avellan has a Bachelor’s in electrical engineering from Simón Bolivar University. We believe Mr. Avellan is qualified to serve on our Board due to his expertise and years of success developing innovative space-based technologies and continually proven engineering and management acumen.
ADRIANA CISNEROS
ADRIANA CISNEROS Ms. Cisneros, age 44, has served as a member of our Board since April 2021. Since September 2013, Ms. Cisneros has served as the Chief Executive Officer of Cisneros, a global enterprise focused on media & entertainment, digital advertising solutions, real estate, and social leadership, and she served as its Vice Chairman and Director of Strategy from September 2005 to August 2013. Ms. Cisneros currently serves on the boards of directors of Mattel Inc. and Ford Motor Company, and also serves on numerous non-profit boards. Ms. Cisneros holds a B.A. in journalism from Columbia University, a M.A. in journalism from New York University and a degree in leadership development from Harvard Business School. We believe Ms. Cisneros is qualified to serve on our Board, serve as Chairwoman of our Compensation Committee and our Redemption Election Committee, and be a member of our Nominating and Corporate Governance Committee based on her significant leadership experience in media, real estate, entertainment and digital and consumer products.
LUKE IBBETSON
LUKE IBBETSON Mr. Ibbetson, age 55, has served as a member of our Board since April 2021. Mr. Ibbetson has worked with Vodafone since 1996 and has led the Vodafone Group Research and Development Organization since 2013, which is responsible for all aspects of future research, including trials of emerging technologies. Mr. Ibbetson serves on the board of several industry groups and initiatives, including the 5G Automotive Alliance, and serves as Chairman of the Next Generation Mobile Networks Alliance Board Strategy committee. Mr. Ibbetson holds a B.Sc. in electronic engineering and a M.Sc. in telecommunications from the University of Leeds. We believe Mr. Ibbetson is qualified to serve on our Board based on his years of experience and commitment to innovative thinking in the telecommunications industry.
EDWARD KNAPP
EDWARD KNAPP Mr. Knapp, age 63, has served as a member of our Board since April 2021. Mr. Knapp currently serves as the corporate Chief Technology Officer for American Tower Corporation. Prior to joining American Tower in 2017, Mr. Knapp served as Senior Vice President of Engineering at Qualcomm, where he was responsible for Qualcomm’s New Jersey Corporate Research Center, from which he managed a global engineering team of researchers and product engineering staff. He currently serves on the board of directors of the Center for Automotive Research. Mr. Knapp holds a B.E. in electrical engineering from Stony Brook University, a M.S. in electrical engineering from Polytechnic University (NYU) in New York, and a M.B.A. from Columbia University. We believe Mr. Knapp is qualified to serve on our Board based on his more than 40 years of communications technology experience and 30 years of experience in the development of the global wireless industry.
HIROSHI MIKITANI
HIROSHI MIKITANI Mr. Mikitani, age 59, has served as a member of our Board since April 2021. Mr. Mikitani is the founder, Chairman and Chief Executive Officer of Rakuten Group, Inc. Founded in 1997 with the mission to contribute to society by creating value through innovation and entrepreneurship, Rakuten Group, Inc. is one of the world’s leading internet service companies. Mr. Mikitani also serves as Vice Chairman and co-Chief Executive Officer of Rakuten Medical, Inc., a global biotechnology company developing precision, cell-targeting investigational therapies on its Alluminox™ platform. Mr. Mikitani has previously served as a member of the Lyft, Inc. board of directors and currently serves on the boards of directors of a number of privately held companies. In 2011, he was appointed Chairman of the Tokyo Philharmonic Orchestra. He also serves as Representative Director of the Japan Association of New Economy (JANE). Mr. Mikitani holds a commerce degree from Hitotsubashi University and an M.B.A. from Harvard Business School. We believe Mr. Mikitani is qualified to serve on our Board based on his extensive operating and management experience with major technology companies.
RONALD RUBIN
RONALD RUBIN Mr. Rubin, age 58, has served as a member of our Board since April 2021. Mr. Rubin is the Co-Founder and Managing Director of Tower Alliance, LLC. Founded in 2014, Tower Alliance, LLC is a leading provider of outsourced services to wireless infrastructure owners. Mr. Rubin served as Chief Financial Officer of Global Tower Partners from 2010 to 2013. Mr. Rubin holds a B.S. in Accounting from American University and a M.S. in Taxation from Florida International University and is a Certified Public Accountant. We believe Mr. Rubin is qualified to serve on our Board and be a member of our Audit Committee based on his years of experience in the telecommunications industry.
CHRISTOPHER SAMBAR
CHRISTOPHER SAMBAR Mr. Sambar, age 50, has served as a member of our Board since June 2024. Mr. Sambar has served as the Head of Network at AT&T since April 2022. In this role, he leads AT&T’s Global Network organization and teams responsible for technology architecture design, engineering, building, and operating AT&T’s next generation mobile and fiber networks. His responsibilities include overseeing one of the world’s largest network infrastructure capital deployments as well as for the 24/7 global operations team ensuring service continuity for more than 100.0 million AT&T mobile and broadband customers, and millions of business customers. Previously, from August 2019 to April 2022, Mr. Sambar was Executive Vice President, Technology Operations at AT&T, responsible for long-term technology initiatives and global planning, construction and engineering of AT&T’s mobile, fiber and core network infrastructure build programs. Since joining AT&T in 2002, Mr. Sambar has held various senior executive positions in AT&T’s FirstNet, Business Solutions, Consumer Broadband, Retail, Human Resources, and Corporate Strategy teams. Mr. Sambar serves on the Board for the National Medal of Honor Museum Foundation which is dedicated to honoring Medal of Honor recipients through the design, build, and maintaining of the museum, monument, and institute. Mr. Sambar holds an M.B.A from the University of Southern California and a Bachelor of Science degree from The United States Naval Academy. Following graduation from the Naval Academy, he served 7 years on active duty and 16 years in the reserves (Navy SEAL) with multiple deployments throughout Europe, the Middle East and one tour of duty during the Iraq war in 2005 and 2006. We believe Mr. Sambar is qualified to serve on our Board based on his extensive leadership experience in the telecommunication industry spanning network & technology operations, capital planning and sales and distribution, among other areas.
RICHARD SARNOFF
RICHARD SARNOFF Mr. Sarnoff, age 65, has served as a member of our Board since April 2021. Mr. Sarnoff is a Partner at Kohlberg Kravis Roberts & Company and leads its media, entertainment and education investing activities for its United States private equity group. From 2014 through 2017, Mr. Sarnoff served as Managing Director and Head of the Media and Communications industry group of Kohlberg Kravis Roberts & Company, leading investments in the media, telecom, digital media and education sectors in the United States. Mr. Sarnoff currently serves on the board of directors of Chegg, Inc. and of several private companies, as well as several not-for-profit organizations. Mr. Sarnoff holds a B.A. in Art and Archeology from Princeton University and an M.B.A. from Harvard Business School. We believe Mr. Sarnoff is qualified to serve on our Board and serve as Chairman of our Nominating and Corporate Governance Committee based on his extensive experience serving in senior leadership roles, and on the boards of directors of media and digital technology companies.
JULIO A. TORRES
JULIO A. TORRES Mr. Torres, age 57, has served as a member of our Board since April 2021. Mr. Torres has served as the managing partner at Multiple Equilibria Capital, a financial advisory firm, since March 2013. Mr. Torres previously served as the Chief Executive Officer and member of the board of directors of Andina Acquisition Corp. III, a blank check company, from January 2019 until its merger with Stryve Foods, Inc. in July 2021. From August 2015 to March 2018, Mr. Torres served as Chief Executive Officer and a member of the board of directors of Andina Acquisition Corp. II, a blank check company that consummated an initial business combination with Lazy Days’ R.V. Center, Inc. From October 2011 through January 2013, Mr. Torres served as Co-Chief Executive Officer of Andina Acquisition Corp. He also served as a member of the board of Andina Acquisition Corp. from October 2011 until its merger in December 2013 with Tecnoglass Inc. and has continued to serve on the board of Tecnoglass Inc. since such time. Mr. Torres also serves on the board of several international public companies. Mr. Torres graduated from the Universidad de los Andes and received an M.B.A. from the Kellogg Graduate School of Management at Northwestern University and a master in Public Administration from the J.F. Kennedy School of Government at Harvard University. We believe Mr. Torres is qualified to serve on our Board, serve as the Chairman of our Audit Committee, and be a member of our Compensation Committee and our Nominating and Corporate Governance Committee based on his extensive operational and corporate governance experience.
JOHAN WIBERGH
JOHAN WIBERGH Mr. Wibergh, age 60, has served as a member of our Board since June 2024. Mr. Wibergh is currently retired, and previously served as Chief Technology and Information Officer of Vodafone, a global telecommunications provider, from May 2015 to December 2022. From July 2008 to January 2015, he served as Executive Vice President & Head of Business Unit Networks for Ericsson, a multinational networking and telecommunications company. He has over 35 years of experience in managing large-scale operations across the globe, having served in various C-suite positions with leading global companies for more than 15 years. He brings with him a wealth of experience in technology innovation and leadership in networking and telecommunications. His leadership experience spans various areas such as telecoms networks, enterprise networks, digital and IT systems, cyber security, R&D, product management, operational excellence, and large-scale 24/7 operations. Mr. Wibergh currently serves on the board of directors of Trimble Inc., a public technology company, and Bell Canada, a public telecommunications company in Canada. Mr.Wibergh is also a member of the Executive Advisory board of Arrcus Inc. Mr. Wibergh also currently serves on the boards of directors of various private companies. Mr.Wibergh’s previous board experience includes Vantage Towers AG (2020-2022), KTH Royal Institute of Technology (2010-2016) and chairman of Next Generation Mobile Networks (2016-2018). He has also served on the advisory boards of IBM, HP Enterprises and Amdocs. Mr. Wibergh has a Masters in Computer Science and Engineering from Linkoping University, Sweden. We believe Mr. Wibergh is qualified to serve on our Board and be a member of our Compensation Committee and our Audit Committee based on his extensive experience and commitment to innovative thinking in the telecommunications industry.
DIRECTOR COMPENSATION
DIRECTOR COMPENSATION
Director Compensation Program
Director Compensation Program Our director compensation program consists of annual cash retainer fees and long-term equity awards for the non-employee directors of our Board who are not affiliated with Anteras, Vodafone, American Tower or Rakuten Mobile Singapore PTE, LTD, a Singapore private limited company (“Rakuten”), or any of their affiliates (the “Director Compensation Program”). Messrs. Rubin, Sarnoff, Torres and Wibergh are, and Mr. Coleman prior to his resignation from our Board was, eligible to participate in the Director Compensation Program. The material terms of the Director Compensation Program are summarized below. Cash Compensation
Director Compensation Program
| ● | Annual Retainer: $50,000 |
Director Compensation Program
| ● | Annual Committee Chair Retainer: |
Director Compensation Program
| ○ | Audit: $20,000 |
Director Compensation Program
| ○ | Compensation: $15,000 |
Director Compensation Program
| ○ | Nominating and Corporate Governance: $10,000 |
Director Compensation Program
| ● | Annual Committee Member (Non-Chair Retainer): |
Director Compensation Program
| ○ | Audit: $10,000 |
Director Compensation Program
| ○ | Compensation: $7,500 |
Director Compensation Program
| ○ | Nominating and Corporate Governance: $5,000 |
Director Compensation Program
Annual cash retainers are paid in quarterly installments in arrears and are pro-rated for any partial calendar quarter of service. Equity Compensation An eligible director who is serving on our Board as of the date of the Annual Meeting of Stockholders each calendar year will be automatically granted, on such Annual Meeting Date, a restricted stock unit award (“RSUs”) with a value of approximately $150,000, which will vest in full on the earlier to occur of (i) the one-year anniversary of the applicable grant date and (ii) the date of the next annual meeting of stockholders following the grant date, subject to the director’s continued service through the applicable vesting date. In addition, these awards will vest in full upon a change in control of the Company (as defined in the AST SpaceMobile 2020 Incentive Award Plan (“2020 Plan”)). Our 2023 Annual Meeting of Stockholders was held on August 17, 2023. On this date, the 2023 annual grant of 38,462 RSUs, which had a grant fair value of $150,000, was made to each eligible director. Refer to the directors’ compensation table below for further detail. Compensation under the Director Compensation Program is subject to the annual limits on non-employee director compensation set forth in the 2020 Plan.
Director Compensation for the Fiscal Year Ended December 31, 2023
Director Compensation for the Fiscal Year Ended December 31, 2023 The following table sets forth information for the fiscal year ended December 31, 2023 regarding the compensation awarded to, earned by or paid to our non-employee directors.
Director Compensation for the Fiscal Year Ended December 31, 2023
| Name(1)(2) | Fees Earned or Paid in Cash ($) | Stock Awards ($)(3) | Total ($) | | Tareq Amin(4) | - | - | - | | Adriana Cisneros | - | - | - | | Alexander Coleman(5) | 75,000 | 150,000 | 225,000 | | Luke Ibbetson | - | - | - | | Edward Knapp | - | - | - | | Hiroshi Mikitani | - | - | - | | Ronald Rubin | 60,000 | 150,000 | 210,000 | | Richard Sarnoff | 60,000 | 150,000 | 210,000 | | Julio A. Torres | 82,500 | 150,000 | 232,500 |
Director Compensation for the Fiscal Year Ended December 31, 2023
| (1) Mr. Avellan, Chairman of the Company’s Board and Chief Executive Officer, is not included in this table as he was our employee in 2023 and did not receive compensation for services as a director. All compensation paid to Mr. Avellan for his services provided to us in 2023 is reflected in the Summary Compensation Table below. | | (2) Messrs. Sambar and Wibergh joined our Board in June 2024 and as such are not included in this table. | | (3) On August 17, 2023, the listed non-employee directors were granted 38,462 RSUs. Amounts represent the aggregate grant date fair value of RSUs computed in accordance with Accounting Standard Codification 718 Compensation - Stock Compensation (“FASB ASC 718”). We provide information regarding the assumptions used to calculate the value of equity awards in Note 12: Stock-Based Compensation to our Consolidated Financial Statements included in our 2023 Annual Report on Form 10-K. |
Director Compensation for the Fiscal Year Ended December 31, 2023
The table below shows the aggregate number of outstanding stock awards, both vested and unvested, for each of the non-employee directors as of December 31, 2023:
Director Compensation for the Fiscal Year Ended December 31, 2023
| Name | RSUs | Options | | Tareq Amin | - | - | | Adriana Cisneros | - | 725,074 | | Alexander Coleman | 66,884 | - | | Luke Ibbetson | - | - | | Edward Knapp | - | - | | Hiroshi Mikitani | - | - | | Ronald Rubin | 66,884 | - | | Richard Sarnoff | 66,884 | 348,035 | | Julio A. Torres | 66,884 | - |
Director Compensation for the Fiscal Year Ended December 31, 2023
| (4) Mr. Amin was a member of the Board until August 8, 2023. | | (5) Mr. Coleman was a member of the Board until June 19, 2024. |
PROPOSAL NO. 3 - APPROVAL OF THE 2024 INCENTIVE AWARD PLAN
PROPOSAL NO. 3 - APPROVAL OF THE 2024 INCENTIVE AWARD PLAN The Board of Directors is submitting the AST SpaceMobile, Inc. 2024 Incentive Award Plan to our stockholders for approval.
Overview
Overview We currently maintain the AST SpaceMobile 2020 Incentive Award Plan (“2020 Plan”), which was originally adopted in connection with the Business Combination (refer to our 2023 Annual Report on Form 10-K for a discussion of the “Business Combination”) by the Board of Directors. Prior to the Business Combination, equity-based awards were granted under the AST LLC 2019 Equity Incentive Plan (“AST LLC Incentive Plan”). The plan was approved in 2019 by the members of AST LLC. Following the completion of the Business Combination, no new awards were granted under the AST LLC Incentive Plan. The Company reserved 10,800,000 shares of Common Stock for issuance pursuant to awards under the 2020 Plan. As of the date of this Proxy Statement, 1,415,079 shares of Common Stock remained reserved for issuance. Additionally, as of June 30, 2024, there were 3,368,859 outstanding RSUs and 4,059,043 outstanding stock options with a weighted average exercise price of $8.26 and a weighted average remaining contractual life of 8.26 years under the 2020 Plan. At this Annual Meeting, the Company is requesting that our stockholders approve the AST SpaceMobile, Inc. 2024 Incentive Award Plan (the “Plan”), which, among other things, would reserve an additional 2,000,000 shares of Class A Common Stock for the issuance of awards under the Plan and may increase the number of shares available for issuance under the Plan by up to 2,000,000 shares annually beginning on January 1, 2025, and on each January 1 during the term of the Plan thereafter. Shares reserved but unissued under the 2020 Plan will also be available for issuance of awards under the Plan. In addition, shares that are currently subject to outstanding awards under the 2020 Plan that expire, are forfeited or otherwise terminate unexercised may be subjected to new awards under the Plan. The Board and the Compensation Committee believe that the Plan is a key part of the Company’s compensation philosophy and programs. Our ability to attract, retain and motivate highly qualified officers, non-employee directors, key employees, consultants and advisors is critical to our success. The Board and the Compensation Committee believe that the interests of the Company and its stockholders will be advanced if we can continue to offer our officers, non-employee directors, key employees, consultants and advisors the opportunity to acquire or increase a direct proprietary interest in the operations and future success of the Company. The Plan was adopted by the Board of Directors on July 29, 2024, subject to the approval of our stockholders. If approved by our stockholders, the Plan will become effective on September 10, 2024, the date of the Annual Meeting, and it will remain in effect until July 29, 2034, unless terminated earlier by the Board of Directors. If approved by our stockholders, the Plan will replace and supersede the 2020 Plan. Upon approval of the Plan by the Company’s stockholders, no new awards shall be made under the 2020 Plan, although outstanding awards previously made under the 2020 Plan shall continue to be governed by the terms of the 2020 Plan. If the Plan is not approved by our stockholders, the 2020 Plan will remain in effect in accordance with its terms, and the Company may continue to make awards thereunder. The Plan is an omnibus plan that includes, in addition to the Plan, separate sub-plans (“Sub Plans”) that permit offerings of grants to employees of certain foreign subsidiaries. Offerings under the Sub Plans may be made in particular locations outside the United States of America and shall comply with local laws applicable to offerings in such foreign jurisdictions. The Plan shall be a separate and independent plan from the Sub Plans, but the total number of Shares authorized to be issued under the Plan applies in the aggregate to both the Plan and the Sub Plans.
Summary of Material Plan Provisions
Summary of Material Plan Provisions A copy of the Plan is included as Appendix A to this proxy statement. The following summary of material Plan provisions is not intended to be complete and is qualified in its entirety by the complete text of the Plan. Administration The Plan is administered by our Board of Directors which may delegate its duties and responsibilities to committees of our directors and/or officers (referred to collectively as the “administrator”), subject to certain limitations that may be imposed under Section 16 of the Exchange Act, and/or stock exchange rules, as applicable. The administrator has the authority to make all determinations and interpretations under, prescribe all forms for use with, and adopt rules for the administration of, the Plan, subject to its express terms and conditions. The administrator will also set the terms and conditions of all awards under the Plan, including any vesting and vesting acceleration conditions. Eligibility All employees, consultants and non-employee directors of the Company, any parent of the Company or any affiliate of the Company are eligible to receive awards under the Plan. The administrator may, from time to time, select from among all eligible individuals those to whom an award shall be granted and shall determine the nature and amount of each award, consistent with the terms of the Plan. Number of Shares Authorized If the Plan is approved by our stockholders, the aggregate number of shares of Class A Common Stock available for issuance in connection with awards made under the Plan shall equal the sum of (i) 2,000,000 shares plus (ii) one share for every one share available for award under the 2020 Plan as of July 30, 2024 (1,415,079), for a total of 3,415,079 shares. Any shares subject to an award under the 2020 Plan and that expires, is forfeited, otherwise terminates or is settled in cash, after the Plan’s effective date, shall be added to the shares reserved for issuance under the Plan. In addition, the number of shares available for issuance under the Plan may increase on each January 1st occurring following the Plan’s effective date in an amount up to 2,000,000 shares as shall be determined by the administrator. Share Usage Shares subject to awards that are forfeited, expire or otherwise terminate, or that are settled for cash, shall again be available for future grants under the Plan to the extent of such forfeiture, expiration, termination or cash settlement. In addition, the following shares shall be available for future grants: (i) shares tendered or withheld in payment of an option exercise price; (ii) shares tendered or withheld to satisfy tax withholding; (iii) shares subject to a stock appreciation right or other stock-settled award that are not issued in connection with the settlement or exercise of such award; and (iv) shares purchased on the open market by the Company with the cash proceeds received from the exercise of options. Non-Employee Director Award Limit The grant date fair value of equity-based awards granted plus the amount of any cash-based awards or other fees paid to a non-employee director during any calendar year shall not exceed $1,000,000. The administrator, in its discretion, may make exceptions to this limit in extraordinary circumstances, provided the non-employee director receiving such additional compensation does not participate in the decision to award such compensation. Types of Awards Types of awards that can be granted under the Plan include stock options, stock appreciation rights (“SARs”), restricted stock, restricted stock units, incentive units, other stock based or cash based awards, and dividend equivalent awards. Stock Options Stock options provide for the purchase of shares of Class A Common Stock in the future at an exercise price set on the grant date. Incentive stock options (ISOs), by contrast to nonqualified stock options (NSOs), may provide tax deferral beyond exercise and favorable capital gains tax treatment to their holders if certain holding period and other requirements of the Code are satisfied. The exercise price of a stock option may not be less than 100% of the fair market value of the underlying share on the date of grant (or 110% in the case of ISOs granted to certain significant stockholders), except with respect to certain substitute options granted in connection with a corporate transaction. The term of a stock option may not be longer than 10 years (or five years in the case of ISOs granted to certain significant stockholders). Stock options may not be granted under the Plan unless granted with respect to “service recipient stock” as defined in Treasury Regulation Section 1.409A-1(b)(5)(iii). Stock Appreciation Rights SARs entitle their holder, upon exercise, to receive from us an amount equal to the appreciation of the shares subject to the award between the grant date and the exercise date. The exercise price of a SAR may not be less than 100% of the fair market value of the underlying share on the date of grant (except with respect to certain substitute SARs granted in connection with a corporate transaction) and the term of a SAR may not be longer than 10 years. SARs may not be granted under the Plan unless granted with respect to “service recipient stock” as defined in Treasury Regulation Section 1.409A-1(b)(5)(iii). Restricted Stock and Restricted Stock Units Restricted stock is an award of nontransferable shares of Class A Common Stock that remain forfeitable unless and until specified conditions are met, and which may be subject to a purchase price. Restricted stock units (RSUs) are contractual promises to deliver shares of Class A Common Stock in the future, which may also remain forfeitable unless and until specified conditions are met. Delivery of the shares underlying RSUs may be deferred under the terms of the award or at the election of the participant, if the administrator permits such a deferral. Incentive Units Incentive units are a class of limited liability company units in AST & Science LLC (“AST LLC”) that may be intended to qualify as “profits interests” within the meaning of the relevant Internal Revenue Service guidance. Incentive units may only be issued to participants for the performance of services to or for the benefit of AST LLC (i) in the participant’s capacity as a member of AST LLC; (ii) in anticipation of the participant’s becoming a member of AST LLC; or (iii) as otherwise determined by the administrator. Incentive units are subject to the terms and conditions of AST LLC’s limited liability company operating agreement and such other restrictions, including restrictions on transferability, as the administrator may impose. Other Stock or Cash Based Awards The administrator is authorized to grant other stock or cash based awards. These awards include cash payments, cash bonus awards, stock payments, stock bonus awards, performance awards or incentive awards that are paid in cash, shares or a combination of both, which may include, without limitation, deferred stock, deferred stock units, performance awards, retainers, committee fees, and meeting-based fees. Dividend Equivalents Dividend equivalents represent the right to receive the equivalent value of dividends paid on shares of Class A Common Stock and may be granted alone or in tandem with other awards. Dividend equivalents are credited as of dividend record dates during the period between the date an award is granted and the date such award vests, is exercised, is distributed or expires, as determined by the administrator. Dividend equivalents will only be paid to the extent that the vesting conditions of the underlying award are satisfied. Performance Criteria and Goals
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION Our executive compensation program is designed to attract, motivate and retain high quality leadership and incentivize our executive officers to achieve performance goals over the short- and long-term, which also aligns the interests of our executive officers with those of our stockholders. Our named executive officers (or “NEOs”) for 2023, who consist of each person who served as our principal executive officer during 2023 and our two other most highly compensated executive officers, were:
EXECUTIVE COMPENSATION
| ● | Abel Avellan, Chairman of the Board and Chief Executive Officer |
EXECUTIVE COMPENSATION
| ● | Sean Wallace, Chief Financial Officer |
EXECUTIVE COMPENSATION
| ● | Brian Heller, General Counsel and Secretary |
EXECUTIVE COMPENSATION
Mr. Wallace retired from the position of Chief Financial Officer of the Company in June 2024, and Mr. Heller left the employment of the Company in May 2024.
Summary Compensation Table
Summary Compensation Table The following table summarizes the compensation of our NEOs for the years ended December 31, 2023 and 2022.
Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Equity Awards ($)(1) | All Other Compensation ($) | Total ($) | | Abel Avellan(2) | 2023 | - | - | - | - | - | | Chairman of the Board and Chief Executive Officer | 2022 | - | - | - | - | - | | Sean Wallace(3) | 2023 | 250,000 | - | - | - | 250,000 | | Former Chief Financial Officer | 2022 | 160,417 | - | 2,784,000(4) | 88,575(5) | 3,032,992 | | Brian Heller(3) | 2023 | 250,000 | - | - | - | 250,000 | | Former General Counsel and Secretary | 2022 | 250,000 | 150,000 | - | - | 400,000 |
Summary Compensation Table
| (1) Amounts represent the aggregate grant date fair value computed in accordance with ASC 718 for equity awards granted. We provide information regarding the assumptions used to calculate the value of equity awards in Note 12: Stock-Based Compensation to our Consolidated Financial Statements included in our 2023 Annual Report. | | (2) Mr. Avellan has historically asked not to be paid any base salary in excess of applicable minimum wage requirements under federal law and, as such, has received substantially below-market base salary. For 2022 and 2023, Mr. Avellan did not receive any base salary from the Company. | | (3) Mr. Wallace retired from the Company in June 2024 and Mr. Heller left the employment of the Company in May 2024. | | (4) On May 10, 2022, pursuant to the terms of his employment agreement, Mr. Wallace received an award of 700,000 RSUs, 400,000 of which are subject to time-based vesting and 300,000 of which are subject to performance-based vesting. The time-based RSUs vest over a four-year service period with 25% of the awards vesting on each anniversary of Mr. Wallace’s vesting commencement date. The performance-based RSUs vest upon satisfaction of two specified capital raising performance conditions. The grant date fair value of the 300,000 performance-based RSUs have been reported at $0 based on the probable outcome of achieving the performance conditions at the time of grant. The grant date fair value of the performance-based RSUs assuming achievement of the performance conditions was $2,088,000. | | (5) Pursuant to the terms of Mr. Wallace’s employment agreement, he was reimbursed $75,000 for direct out-of-pocket costs associated with his relocation to the Miami, Florida area where our corporate office is located, and $13,575 for legal fees associated with the negotiation and execution of his employment agreement. |
Outstanding Equity Awards at 2023 Fiscal Year-End
Outstanding Equity Awards at 2023 Fiscal Year-End The following table sets forth certain information regarding equity-based awards of the Company held by the NEOs as of December 31, 2023.
Outstanding Equity Awards at 2023 Fiscal Year-End
| | Stock Awards | | | | | Name | Number of Shares or Units of Stock That Have Not Vested (#) (1) | Market Value of Shares or Units of Stock That Have Not Vested ($) (2) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) (3)(4) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | Abel Avellan | - | - | - | - | | Sean Wallace | 300,000 | 1,809,000 | 300,000 | 1,809,000 | | Brian Heller | 102,500 | 618,075 | 145,000 | 874,350 |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (1) Mr. Wallace’s 400,000 RSUs vest over a four year service period with 25% of the awards vesting on each anniversary of the May 10, 2022 vesting commencement date. Mr. Heller’s 205,000 RSUs vest over a four year service period with 25% of the awards vesting on each anniversary of the February 8, 2021 vesting commencement date. | | (2) Fair market value of awards was $6.03 per share as of December 31, 2023. | | (3) Mr. Wallace’s 300,000 RSUs vest upon satisfaction of two specified capital raising performance conditions. Half of each portion of these RSUs vest upon the attainment of the specified performance targets and the remaining half of each portion of these RSUs vest on the first anniversaries of the attainment of the specified performance targets. Mr. Wallace’s 75,000 RSUs vested on March 15, 2024, upon the certification of the Compensation Committee of the satisfaction of one of the performance conditions. The remaining 75,000 RSUs would have vested on March 15, 2025, subject to Mr. Wallace’s continued service through the vesting date. Mr. Heller’s 145,000 RSUs vest upon satisfaction of certain specified performance conditions. Mr. Heller’s 72,500 RSUs vested on March 15, 2024, upon the certification of the Compensation Committee of the satisfaction of the performance conditions. The remaining 72,500 RSUs would have vested on March 15, 2025, subject to Mr. Heller’s continued service through the vesting date. | | (4) In connection with Mr. Wallace’s retirement from the Company in June 2024, 55,890 shares of certain unvested portions of his outstanding time-based vesting RSUs were accelerated. In connection with Mr. Heller’s departure from the Company in May 2024, all of his unvested time-based vesting RSUs were forfeited. |
Pay Versus Performance
Pay Versus Performance Set forth below is certain information about the relationship between executive “compensation actually paid” (or “CAP”), as defined by SEC rules, to the Company’s principal executive officer (“PEO”) and non-PEO named executive officers (the “Non-PEO NEOs”) and certain aspects of the financial performance of the Company. The Compensation Committee does not utilize CAP as the basis for making compensation decisions. The following table sets forth certain information regarding pay versus performance as of December 31, 2023.
Pay Versus Performance
| Year(1) | Summary Compensation Table Total for PEO ($) (2) | Compensation Actually Paid to PEO ($) (3) | Average Summary Compensation Table Total for Non-PEO NEOs ($)(2) | Average Compensation Actually Paid to Non-PEO NEOs ($)(3) | AST SpaceMobile Total Shareholder Return ($)(4) | Net Income (Loss) ($000)(5) | | 2023 | - | - | $250,000 | $537,444 | $44 | $(87,561) | | 2022 | - | - | $1,716,496 | $989,452 | $35 | $(31,640) | | 2021 | $8,995 | $8,995 | $1,430,211 | $160,579 | $58 | $(30,553) |
Pay Versus Performance
| (1) Abel Avellan served as the PEO for the entirety of 2023, 2022, and 2021. Our Non-PEO NEOs for the applicable years were as follows: |
Pay Versus Performance
| ● | 2023: Sean Wallace and Brian Heller | | ● | 2022: Sean Wallace and Brian Heller | | ● | 2021: Brian Heller and Thomas Severson |
Pay Versus Performance
| (2) Amounts reported in these columns represent (i) the total compensation reported in the Summary Compensation Table (“SCT”) for the applicable year in the case of our PEO, Mr. Avellan, and (ii) the average of the total compensation reported in the SCT for the applicable year for our Non-PEO NEOs reported for the applicable year. |
Pay Versus Performance
| (3) Amounts reported in these columns represent compensation actually paid; adjustments were made to the amounts reported in the SCT for the applicable year. |
Pay Versus Performance
| (4) Total Shareholder Return (“TSR”) is cumulative for the measurement periods beginning on December 31, 2020 and ending on December 31 of each of 2023, 2022 and 2021, respectively, calculated in accordance with Item 201(e) of Regulation S-K. |
Pay Versus Performance
| (5) The dollar amounts reported represent the amount of net income (loss) attributable to common stockholders reflected in the accompanying consolidated financial statements |
Pay Versus Performance
A reconciliation of the adjustments for Mr. Avellan and for the average of the Non-PEO NEOs is set forth in the following table, which describes the adjustments, each of which is prescribed by the SEC rules, to calculate the CAP from SCT amounts. Equity values are calculated in accordance with FASB ASC 718.
Pay Versus Performance
| | 2023 PEO | 2023 Non-PEO NEOs | 2022 PEO | 2022 Non-PEO NEOs | 2021 PEO | 2021 Non-PEO NEOs | | Summary Compensation Table Total (1) | - | $250,000 | - | $1,716,496 | $8,995 | $1,430,211 | | Minus Stock Award Value & Option Award Value Reported in SCT for the Covered Year | - | - | - | $1,392,000 | - | $1,025,000 | | Plus Year End Fair Value of Equity Awards Granted During the Covered Year that Remain Outstanding and Unvested as of Last Day of the Covered Year | - | - | - | 964,000 | - | 813,850 | | Plus Year over Year Change in Fair Value as of the Last Day of the Covered Year of Outstanding and Unvested Equity Awards Granted in Prior Years | - | 243,513 | - | (239,850) | - | (735,900) | | Plus Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Covered Year | - | - | - | - | - | - | | Plus Year over Year Change in Fair Value as of the Vesting Date of Equity Awards Granted in Prior Years that Vested During the Covered Year | - | 43,931 | - | (59,194) | - | (322,582) | | Minus Fair Value at the End of the Prior Year of Equity Awards that Failed to Meet Vesting Conditions in the Covered Year | - | - | - | - | - | - | | Plus Value of Dividends or other Earnings Paid on Stock or Option Awards Not Otherwise Reflected in Fair Value or Total Compensation for the Covered Year | - | - | - | - | - | - | | Compensation Actually Paid | - | $537,444 | - | $989,452 | $8,995 | $160,579 |
Pay Versus Performance
| (1) Unvested equity values are computed in accordance with the methodology used for financial reporting purposes, and for unvested awards subject to performance-based vesting conditions, based on the probable outcome of such performance-based vesting conditions as of the last day of the year. |
Pay Versus Performance
The following provide graphic descriptions of the relationships between information presented in the pay versus performance table provided above. Relationship Between CAP and Total Shareholder Return (“TSR”) The graph below reflects the relationship between the PEO and Average Non-PEO NEOs CAP and our TSR. Relationship Between CAP and Net Income (Loss) Attributable to Stockholders The graph below reflects the relationship between the PEO and Average Non-PEO NEOs CAP and our net income (loss) attributable to stockholders.
Pay Versus Performance
| (1) Represents the amount of net loss attributable to common stockholders reflected in the Company’s audited financial statements for the applicable year. |