DEF 14A of PDF Solutions Inc
Filed Apr 29, 2024 · FY20230001558370-24-006140
Proposal No. 1:Election of Class II Directors
Proposal No. 1:Election of Class II Directors The Board of Directors, upon recommendation from the NCG Committee of the Board, has nominated three candidates for election/re-election to the Board this year as Class II directors: Chi-Foon Chan, Kimon W. Michaels, and Shuo Zhang. Detailed information about each nominee, and each of our continuing directors, is provided below.
Proposal No. 1:Election of Class II Directors
| Name | Class | Election Year | Age | Position(s) | Director Since | | Nominees: | | | | | | | Chi-Foon Chan, Ph.D. | II | 2024 | 74 | Director | 2023 | | Kimon W. Michaels, Ph.D. | II | 2024 | 58 | Director, Vice President, Products and Solutions | 1995 | | Shuo Zhang | II | 2024 | 59 | Director | 2019 | | Continuing Directors: | | | | | | | Nancy Erba | III | 2025 | 57 | Director | 2019 | | Michael B. Gustafson | III | 2025 | 57 | Director | 2018 | | John K. Kibarian, Ph.D. | III | 2025 | 60 | Director, President and CEO | 1992 | | Joseph R. Bronson | I | 2026 | 75 | Lead Independent Director | 2014 | | Ye Jane Li | I | 2026 | 56 | Director | 2021 |
Proposal No. 1:Election of Class II Directors
THE BOARD RECOMMENDS THAT OUR STOCKHOLDERS VOTE FOR THE ELECTION OF EACH OF THE CLASS II DIRECTOR NOMINEES INDICATED ABOVE.
Nominees for Class II Directors
Nominees for Class II Directors
Nominees for Class II Directors
| Chi-Foon Chan, Ph.D. Former President, Co-Chief Executive Officer and Director, Synopsys, Inc Independent | | | Kimon W. Michaels, Ph.D. Vice President, Products and Solutions, PDF Solutions, Inc. Non-Independent Director | | | | Director Since 2023 | Age 74 | Committees NCG | Director Since 1995 | Age 58 | Committees None | | Director Qualifications ▪ Dr. Chan brings to the Board more than 24 years of senior executive-level leadership, strategic, and operational experience within the EDA industry, with a thorough understanding of business, operations and technology strategies. He has broad knowledge of the overall EDA industry landscape, and he provides particular expertise in the Asia-Pacific region. We also benefit from Dr. Chan’s extensive research and development and engineering experience in the semiconductor industry gained from his prior leadership positions. Select Business Experience ▪ Dr. Chan has served on the Board of Advisors for TMFG Group at Intel Corporation since 2022. ▪ Dr. Chan was President, Co-Chief Executive Officer and a member of the Board of Directors of Synopsys, Inc. from 2012 to 2022 and Chief Operating Officer of Synopsys, Inc. from 1998 to 2012. ▪ Prior to that he was a Senior Engineering Manager at Intel Corporation and General Manager-Microprocessor Division at NEC Electronics Corporation. Other Public Company Directorships in Past Five Years ▪ Synopsys, Inc. (from 2012 to 2022) | | | Director Qualifications ▪ Dr. Michaels provides the Board with unique insight regarding Company-wide issues gained in his position as an executive officer of the Company, including various leadership capacities and levels of operations, and as one of our co-founders. This experience provides the Board with invaluable insight into Company operations. Select Business Experience ▪ Dr. Michaels, one of our founders, has served as our Vice President, Products and Solutions since July 2010, and was designated an Executive Vice President in February 2019. ▪ He served as our Vice President, Design for Manufacturability from June 2007 through June 2010. ▪ Prior to that, Dr. Michaels served as our Vice President, Field Operations for Manufacturing Process Solutions from January 2006 through May 2007. ▪ From March 1993 through December 2005, he served in various vice-presidential capacities at the Company. ▪ Dr. Michaels also served as Chief Financial Officer from November 1995 to July 1998. | | |
Nominees for Class II Directors
Nominees for Class II Directors
Nominees for Class II Directors
| Shuo Zhang Chief Executive Officer and General Partner, Renascia Partners LLC Independent | | | | Director Since 2019 | Age 59 | Committees CHCM; NCG | | Director Qualifications ▪ Ms. Zhang brings a wide range of relevant experience and expertise in the semiconductor and test industries that is invaluable to our evolutions to the leading provider of big data solutions for the semiconductor and electronics markets. We greatly benefit from her impressive executive track record in sales, marketing, and international mergers and acquisitions, and from her insights and business acumen. Select Business Experience ▪ Ms. Zhang serves as Chief Executive Officer and General Partner of Renascia Partners LLC (since 2015) and has also been involved with private venture capital firms in the Silicon Valley for approximately 25 years. Previously, she served in various senior management capacities at Cypress Semiconductor, including corporate development, general management and worldwide mobile sales (from 2007 to 2015). Other Public Company Directorships in Past Five Years ▪ Soitec SA (since 2021) ▪ Telink Semiconductor Shanghai Co Ltd (since 2017) ▪ Grid Dynamics Holdings, Inc. (since 2017) ▪ E.Merge Technology Acquisition Corp. (from 2020 to 2022) | | |
Continuing Class III Directors
Continuing Class III Directors
Continuing Class III Directors
| Nancy Erba Chief Financial Officer, Infinera Corporation Independent | | | Michael B. Gustafson Executive Chairman, Druva, Inc. Independent | | | | Director Since 2019 | Age 57 | Committees Audit (Chair) | Director Since 2018 | Age 57 | Committees CHCM (Chair); Audit | | Director Qualifications ▪ Ms. Erba is an “audit committee financial expert” based on her knowledge and understanding of generally accepted accounting principles and financial statements, her experience analyzing and evaluating financial statements that present a breadth and level of complexity of accounting issues relevant to those of the Company, and her understanding of internal control over financial reporting. Ms. Erba has an impressive track record of success in building and leading best in class finance, business operations, and corporate development organizations throughout her career, and provides the Board with valuable oversight, direction, and strategic input. Select Business Experience ▪ Ms. Erba is currently Chief Financial Officer of Infinera Corporation (since 2019). ▪ Prior to that, she served as Chief Financial Officer at Immersion Corporation (from 2016 to 2019) and held various executive roles in finance, business operations and corporate development at Seagate Technology (from 2003 to 2015). | | | Director Qualifications ▪ Mr. Gustafson’s more than 30 years as a successful leader of multiple technology companies and teams, including public and private, across infrastructure and software offerings make him a valuable advisor to us. Select Business Experience ▪ Mr. Gustafson is the Executive Chairman and a member of the board of directors of Druva, Inc. (since 2016), a privately held company. He is also the sole member of Carve Your Destiny, LLC (since 2016) and an independent Director of Reltio Inc. (since 2016), Indico Data Systems (since 2022), and Auvik Networks (since 2023), all privately held companies. ▪ Previously, he served as Senior Vice President at Western Digital Corporation (from 2013 to 2016), Chief Executive Officer and Chairman of Virident Systems, Inc. (from 2012 to 2013), Senior Vice President and General Manager of File & Content Business at Hitachi Data Systems (from 2011 to 2012), and Chief Executive Officer and Board Member of BlueArc Corporation (from 2004 through acquisition by Hitachi Data Systems in 2011). Other Public Company Directorships in Past Five Years ▪ Matterport, Inc. (since 2021) ▪ Everspin Technologies, Inc. (from 2017 to 2022) | | |
Continuing Class III Directors
Continuing Class III Directors
Continuing Class III Directors
| John K. Kibarian, Ph.D. President, Chief Executive Officer, and Director, PDF Solutions, Inc. Non-Independent | | | | Director Since 1992 | Age 60 | Committees None | | Director Qualifications ▪ Being a leader of the Company since its founding, Dr. Kibarian brings to the Board an extraordinary understanding of our Company’s business, history, and organization. Dr. Kibarian’s training and education as an engineer, together with his day-to-day leadership and intimate knowledge of our business and operations, helps the Board in developing and executing our long-term strategy. Select Business Experience ▪ Dr. Kibarian is one of our co-founders and has served as our President (since 1991) and our Chief Executive Officer (since 2000). ▪ He is also a Governing Council member of Electronic System Design Alliance (since 2019). | | |
Continuing Class I Directors
Continuing Class I Directors
Continuing Class I Directors
| Joseph R. Bronson Principal and Chief Executive Officer, The Bronson Group, LLC Lead Independent Director | | | Ye Jane Li Strategic Advisor, Diversis Capital Independent Director | | | | Director Since 2014 | Age 75 | Committees NCG (Chair); Audit | Director Since 2021 | Age 56 | Committees CHCM | | Director Qualifications ▪ Mr. Bronson has extensive experience in finance and operations spanning more than 21 years and he brings over 50 total years of audit committee chair experience. Mr. Bronson’s financial experience is beneficial to us and combined with Mr. Bronson’s extensive knowledge of the industry and operations, enables him to provide valuable strategic input to us. Select Business Experience ▪ Mr. Bronson is currently the Principal and Chief Executive Officer of The Bronson Group, LLC (since 2011). ▪ Since 2021, Mr. Bronson has served as Chair of the board of directors of GraphAudio, Inc., a private company that develops acoustic systems for mobile and connected devices. ▪ Previously, Mr. Bronson was a Managing Director and Strategic Advisor to Cowen & Co. (from 2017 to 2021), Advisory Director at GCA Savvian, LLC (from 2011 to 2014), Chief Executive Officer of Silicon Valley Technology Corporation (from 2009 to 2010). ▪ Prior to that, he served as President and Chief Operating Officer of Sanmina-SCI (from 2007 to 2008), President and Co-Chief Executive Officer of FormFactor, Inc. (from 2004 to 2007), and a senior executive including the CFO and CAO of the company and a Member of the Office of the President at Applied Materials, Inc. (from 1984 to 2004). ▪ Mr. Bronson previously served on the board of directors of Sanmina-SCI (from 2007 to 2009). Other Public Company Directorships in Past Five Years ▪ Maxim Integrated Products, Inc. (from 2007 to 2021) ▪ Jacobs Solutions Inc. (f/k/a Jacobs Engineering Group Inc.) (from 2004 to 2021) | | | Director Qualifications ▪ Ms. Li brings executive-level experience in a wide range of technology companies and international experience with global companies headquartered in the United States, Japan, and China, and successful track record in general management, strategy development, M&A, and marketing and sales leadership. We greatly benefit from her meaningful insight. We also benefit from Ms. Li’s broad corporate governance experience derived from her experience on multiple U.S. public company boards. Select Business Experience ▪ Ms. Li currently serves as a Strategic Advisor for Diversis Capital, LLC (since 2013). Prior to that, she was Chief Operating Officer of Huawei Enterprise USA Inc. (from 2012 to 2015), and the General Manager for Huawei Symantec USA, Inc. (from 2010 to 2012), and Executive Vice President and General Manager for Fujitsu Compound Semiconductor Inc. and its joint venture with Sumitomo Electric Industries, Ltd., Eudyna Devices Inc. (from 2004 to 2009). Ms. Li has also served on the board of directors of ServicePower, a private company (since 2017). Other Public Company Directorships in Past Five Years ▪ Knowles Corporation (since 2018) ▪ Semtech Corporation (since 2016) ▪ CTS Corporation (from 2020 to 2023) | | |
New Plan Benefits
| (1) Represents the dollar value of RSUs that we expect to grant to our non-employee directors pursuant to our non-employee director compensation program. The number of shares subject to these RSUs is not determinable because it will be only known at the time of grant. These Awards will be made under the Ninth 2011 Amended Plan if it is approved by stockholders or under the Eighth Amended 2011 Plan if the Ninth 2011 Amended Plan is not approved by stockholders. |
Executive Compensation Objectives
| ▪ | to align our NEOs’ interest with long-term stockholder value; |
Elements of our Executive Compensation Program
| | | | Objective | | | | | Element | Philosophy Statement | Basis for Compensation Decisions; Pay-for- Performance Criteria | Reward Performance | Attract & Retain | Align to Stockholder Value | Adhere to High- Ethical Standards | | Base Salary | We provide a base salary to our NEOs as a significant element of their overall compensation to recruit and retain experienced executives. | Base salary takes into account the NEO’s qualifications, experience, prior salary, and competitive salary information based on competitive market data as described below. | | | | | | Annual Cash Incentive Bonus | We provide an annual incentive cash bonus program to reward our NEOs for individual and Company performance, with 50% of each NEO’s target annual incentive cash bonus opportunity payable based on the achievement of specified Company year-over-year revenue growth, Company adjusted EBITDA, and individual performance rating goals under our PPCP, and the remaining 50% payable in the sole discretion of the CHCM Committee. | After the end of each year, the CHCM Committee reviews our performance and the individual NEO’s performance for the preceding year taking into consideration such factors as leadership qualities, business responsibilities, career with the Company, current compensation arrangements, and long-term potential to enhance stockholder value. | | | | | | Annual Discretionary Long-Term Equity Incentive Awards | With the exception of our founders, whose interest are already aligned with the Company due to their substantial stock holdings, we provide annual discretionary long-term equity incentive awards, with vesting based on continued service with the Company to align our non-founder NEOs’ interests with those of our stockholders. | The CHCM Committee considers the non-founder NEO’s relative job scope, the value of such NEO’s outstanding long-term equity incentive awards, individual and Company performance history, prior contributions to the Company, the size of prior awards, and competitive market data as described below. | | | | | | Health and Welfare Benefits and Retirement Benefits | We provide industry-standard programs to provide for the health, welfare and retirement planning of our NEOs, including life insurance equal to the lesser of $200,000 or base salary. | The CHCM Committee has determined that our NEOs may participate on the same terms in the same programs that are available to all employees. | | | | |
Elements of our Executive Compensation Program
In connection with its annual assessment of our compensation policies and practices, the CHCM Committee maintains an annual cash incentive award program as further described below to drive our performance, including the performance of our affiliates and operating units, and to align, motivate and reward eligible employees by making a portion of their cash compensation dependent on the achievement of certain Company performance goals. Cash bonuses awarded pursuant to the annual cash incentive award program are based on the attainment of performance goals, which may include corporate and strategic business objectives, a participant’s individual performance and contribution to the Company, and/or any other factor deemed appropriate by the CHCM Committee. Performance goals and target amounts are established, and may be modified, by the CHCM Committee at any time, as determined appropriate in the CHCM Committee’s sole discretion. Corporate objectives may include one or more objective measurable performance factors. The CHCM Committee has reserved the right, in its sole discretion, to increase, reduce or eliminate the amount of cash bonus otherwise payable to a participant with respect to any performance period. No cash bonus will be payable with respect to any performance period until the applicable results have been verified by the CHCM Committee and the CHCM Committee otherwise determines that the underlying terms and conditions of the program have been satisfied.
Annual Cash Incentive Award Program
Annual Cash Incentive Award Program Pay-For-Performance Program In February 2023, the CHCM Committee set the pay-for-performance component of our executive compensation program as it applied to 2023 by establishing the 2023 calendar year as a performance period under the Pay-for-Performance Compensation Program (“PPCP”) and setting the specific revenue, non-GAAP profitability, and individual performance goals as follows, with a general scaling for the amount to which the general Company bonus pool was funded in 2023, or what we call the “corporate factor”:
Annual Cash Incentive Award Program
| ▪ | Positive Year-Over-Year Revenue Growth |
Annual Cash Incentive Award Program
| ▪ | Positive Adjusted EBITDA* |
Annual Cash Incentive Award Program
| ▪ | Performance Rating Above “DM” (Did Not Meet Expectations) |
Annual Cash Incentive Award Program
*As used in the PPCP, “Adjusted EBITDA” means the Company’s EBITDA (earnings before interest, taxes, depreciation and amortization), adjusted for bonus expense, stock-based compensation expense, expenses of arbitration and acquisition-related costs. We chose these measures because we believed they would motivate our executives to drive Company growth and profitability consistent with our board-approved annual financial and long-term strategic plans. The “corporate factor” under the PPCP represents the funding of the general bonus pool. The corporate factor is determined by comparing the result of the sum of the target bonus of all employees multiplied by a factor representing everyone’s performance rating for 2023, to the total dollar amount accrued for the general bonus pool during the year. Fifty percent (50%) of the overall annual cash incentive award program payout for each NEO is based on strategic contributions of each individual, including leadership regarding strategic initiatives and key account and partner relationships, and driving bookings and revenue activities. Target Bonus In April 2023, the CHCM Committee, after consultation with its independent compensation consultant, set individual incentive opportunities, set as a percentage of base salary, corresponding with each individual’s position and responsibilities with the Company and competitive pay practices, 50% of which would then be subject to the above goals for the 2023 PPCP. In 2023, each NEO received target incentive opportunity increases based on their performance and market competitiveness and internal equity considerations. The table below sets forth the amount of each NEO’s target bonus opportunity for 2023 under the annual cash incentive award program, as compared to each NEO’s target bonus opportunity for 2022.
Annual Cash Incentive Award Program
| | 2023 Total | 2023 Total | 2022 Total | 2022 Total | | | | Target Incentive | Target Incentive | Target Incentive | Target Incentive | | | | Opportunity | Opportunity | Opportunity | Opportunity | Percentage | | Name | (as % of base salary) | ($) | (as % of base salary) | ($) | Increase | | John K. Kibarian | 60% | $270,000 | 50% | $220,000 | 22.73% | | Adnan Raza | 60% | $234,000 | 50% | $185,000 | 26.49% | | Kimon W. Michaels | 60% | $240,000 | 50% | $190,000 | 26.32% | | Andrzej Strojwas | 50% | $184,500 | 50% | $180,000 | 2.50% |
Annual Cash Incentive Award Program
2023 Annual Cash Incentive Award Program Payout Results In March 2024, the CHCM Committee reviewed the Company’s and each NEO’s 2023 performance against the goals and factors described above. For 2023, we achieved total revenue of $165.8 million, which is positive year-over-year growth of $17.3 million, and positive adjusted EBITDA of $38.6 million. Adjusted EBITDA is calculated as EBITDA (earnings before interest, taxes, depreciation, and amortization), adjusted for (i) $6.5 million in bonus expense; (ii) $21.5 million in stock-based compensation expense; and (iii) $2.8 million in arbitration expense and acquisition-related costs. All of the NEOs’ performance ratings for 2023 were higher than DM and the corporate factor was 66.98%. The CHCM Committee met in executive session for the evaluation of Dr. Kibarian’s bonus payout. Dr. Kibarian submitted recommendations for each of the other NEOs based on his evaluation of each individual’s contributions to the Company’s strategic initiatives, which the CHCM Committee considered in determining the discretionary bonus award for the other NEOs. Individual strategic contributions included:
Annual Cash Incentive Award Program
| John K. Kibarian | Leadership regarding strategic initiatives; building key customer relationships | | Adnan Raza | Leadership regarding strategic initiatives; driving bookings and revenue activities | | Kimon W. Michaels | Leadership regarding strategic initiatives; building key partner relationships | | Andrzej Strojwas | Leadership regarding strategic initiatives; building key partner relationships |
Annual Cash Incentive Award Program
The PPCP bonus payout to each NEO for 2023 performance is set forth in the Non-Equity Incentive Plan Compensation column of the “Summary Compensation Table” below, and the discretionary bonus payout to each NEO for 2023 performance is set forth in in the Bonus column of the “Summary Compensation Table” below.
Annual Cash Incentive Award Program
| | | | Corporate | | | | Total Bonus | | | | | Bonus | PPCP | Discretionary | Total Bonus | Payout | | | Target Incentive | Achievement | Funding | Component | Component | Payout | (% of | | Name | Opportunity | of PPCP Goals | Percentage | Payout | Payout | ($) | Target) | | John K. Kibarian | $270,000 | 100% | 66.98% | $90,423 | $39,577(1) | $130,000 | 48.15% | | Adnan Raza | $234,000 | 100% | 66.98% | $78,367 | $86,633 | $165,000 | 70.51% | | Kimon W. Michaels | $240,000 | 100% | 66.98% | $80,376 | $77,720 | $158,096 | 65.87% | | Andrzej Strojwas | $184,500 | 100% | 66.98% | $61,789 | $48,211 | $110,000 | 59.62% |
Annual Cash Incentive Award Program
| (1) Dr. Kibarian elected to decrease his discretionary cash bonus payout from $90,450 to $39,577 to ensure the Company bonus pool would have additional funds to adequately reward and incentivize employees. |
Annual Long-Term Equity Incentive Awards
Annual Long-Term Equity Incentive Awards In determining whether annual long-term equity incentive awards will be granted to our NEOs and the size of any such equity incentive awards, the CHCM Committee generally considers a number of factors, including, but not limited to, the relative job scope of the executive officer, the value of his existing long-term equity incentive awards, the NEO’s individual, and our, performance history, prior contributions to the Company, the size of prior equity incentive awards, and the peer data as described above. Based on some or all of these factors, the CHCM Committee determines in its discretion the total annual long-term equity incentive awards that it considers appropriate to create a meaningful opportunity for reward predicated on the creation of long-term stockholder value. Based on their strong individual performance in 2022, on July 1, 2023, 20,000 RSUs were granted to Mr. Raza and 10,000 RSUs were granted to Dr. Strojwas. These awards each vest 12.5% of the total RSUs on the date that is six months after the July 1, 2023, vesting start date and 12.5% of the total RSUs on each date that is six months thereafter until fully vested, subject to the NEO’s continued service through each applicable vesting date. Despite strong individual performance by Drs. Kibarian and Michaels, no equity award was granted to them due to their significant ownership in the Company from their history as founders of the Company and their corresponding, existing alignment with stockholders in general, as well as a desire on the part of Drs. Kibarian and Michaels to reserve the stock pool for other purposes, such as awards to other employees and consultants. The amount of, and the vesting schedules for, equity awards granted to our NEOs in 2023 are set forth below in the “Grants of Plan-Based Awards for Fiscal Year 2023” table below.
2023 Compensation Decision-Making Process and Results
2023 Compensation Decision-Making Process and Results Process Generally, around the first quarter of each year, the CHCM Committee reviews the previous year’s performance of each of our NEOs and the Company. The CHCM Committee relies upon the judgment of its members in making compensation decisions, reviewing the performance of the Company and carefully evaluating each NEO’s performance during the year against leadership qualities, operational performance, business responsibilities, career with the Company, current compensation arrangements, and long-term potential to enhance stockholder value. Also, while the CHCM Committee may consider competitive market compensation paid by peer companies, as further described below, in assessing the reasonableness of compensation, the CHCM Committee does not attempt to achieve and maintain a certain target percentile within a peer group or otherwise rely entirely on that data to determine NEO compensation. Instead, the CHCM Committee maintains the flexibility in its assessment and decision-making process to respond to and adjust for the evolving business environment. The CHCM Committee strives to achieve an appropriate mix between equity incentive awards and cash payments to meet the objectives of our executive compensation program and may consider such data in its compensation decisions; however, no particular apportionment goal is set. We believe the most important indicator of whether our compensation objectives are being met is our ability to motivate our NEOs to deliver superior performance (as well as their actual ability to do so) and to retain them to continue their careers with the Company on a cost-effective basis. The CHCM Committee discusses our Chief Executive Officer’s compensation package with him but makes decisions with respect to his compensation without him present. The CHCM Committee reports to our Board of Directors on the major items covered at each Committee meeting. The CHCM Committee believes our executive compensation programs are effectively designed and working well in alignment with the interests of our stockholders and are instrumental to achieving our business strategy. As has been the case in the past, the CHCM Committee will consider any stockholder concerns and feedback on its executive compensation programs that it receives. We hold an annual advisory stockholder vote on executive compensation. More than 99% of the shares were cast (for or against) our NEOs’ compensation at the most recent annual meeting of stockholders. In evaluating our compensation program for 2023, the CHCM Committee was mindful of the support our stockholders expressed for our executive compensation programs. As a result, in 2023 the CHCM Committee retained its general approach to executive compensation and continued to apply the same general principles and philosophy as in prior years. Role of CHCM Committee Consultant The CHCM Committee is authorized to retain the services of compensation consultants and other advisors from time to time, as it sees fit, in connection with its oversight of, and decisions related to, our executive compensation program. In 2023, the CHCM Committee retained the services of Compensia, Inc., an independent compensation consultant (“Compensia”). Compensia provided the CHCM Committee advice and recommendations on our peer group and executive management, including NEO compensation. Compensia provided no other services to the Company in 2023. Based on the consideration of the various factors as set forth in the rules of the SEC and Nasdaq, as applicable, the CHCM Committee determined that Compensia is an independent compensation consultant under the rules of the Nasdaq and there are no conflicts of interest. Use of Competitive Data and Peer Group To assess the competitiveness of our executive compensation for 2023, the CHCM Committee analyzed competitive market compensation paid by companies in our peer group based on market data obtained from Compensia. In February 2023, the CHCM Committee approved the below peer group selected by Compensia. The selection criteria was as follows: headquartered in the same country; same or related/adjacent industry; last four quarters of revenue as of December 2022 within approximately 0.5 times to 6.6 times that of the Company over the same period; market cap within approximately 0.1 times to 3.5 times that of the Company based on 30-day average stock prices as of February 22, 2023, and shares outstanding as of such date; and strong revenue growth, strong market cap-to-revenue multiple, and relevant IPO timing, resulting in a total of 18 companies in the peer group as set forth in the table below:
2023 Compensation Decision-Making Process and Results
| 2023 Peer Group | | | | Agilysys Ambarella American Software Amplitude CEVA Couchbase | Credo Technology Group Domo eGain ForgeRock Ideanomics Impinj | Matterport Mitek Systems Model N Onto Innovation SoundThinking Sumo Logic |
2023 Compensation Decision-Making Process and Results
Our CHCM Committee believes that peer group comparisons provide a useful framework to measure the competitiveness of our compensation practices. The CHCM Committee understands that no two companies are exactly alike, and it maintains the discretion to set levels of NEO compensation above or below levels paid by our peers based upon factors such as individual performance, an NEO’s level of experience and responsibilities, individual discussions with the NEO, and our compensation budget. The CHCM Committee intends to review our peer group at least annually and make adjustments to its composition as necessary.
Summary Compensation Table
Summary Compensation Table The following table presents the compensation paid to and earned by our Named Executive Officers in the last three years.
Summary Compensation Table
| | | | | Stock | Option | Non-Equity | All Other | | | | | Salary | Bonus | Awards | Awards | Incentive Plan | Compensation | | | Name & Principal Position | Year | ($) | ($)(1) | ($)(2) | ($) | Compensation | ($)(3)(4) | Total ($) | | John K. Kibarian | 2023 | 447,500 | 39,577 | — | — | 90,423(5) | 18,419 | 595,919 | | Chief Executive | 2022 | 426,667 | 220,000 | — | — | — | 7,953 | 654,620 | | Officer, President, and Director | 2021 | 400,000 | — | — | — | — | 9,105 | 409,105 | | Adnan Raza | 2023 | 385,002 | 86,633 | 902,000 | — | 78,367(5) | 22,786 | 1,474,788 | | Chief Financial | 2022 | 355,000 | 185,000 | 622,500 | — | — | 3,586 | 1,166,086 | | Officer, Executive | 2021 | 310,000 | — | 544,200 | — | — | 9,105 | 863,305 | | Vice President, Finance | | | | | | | | | | Kimon W. Michaels | 2023 | 395,000 | 77,720 | — | — | 80,376(5) | 18,736 | 571,832 | | Executive Vice | 2022 | 372,500 | 190,000 | — | — | — | 7,636 | 570,136 | | President, Products and Solutions and Director | 2021 | 350,000 | — | — | — | — | 9,105 | 359,105 | | Andrzej Strojwas | 2023 | 366,750 | 48,211 | 451,000 | — | 61,789(5) | 13,516 | 941,266 | | Chief Technology | 2022 | 357,500 | 180,000 | 1,161,200 | — | — | 12,516 | 1,711,216 | | Officer | 2021 | 145,837(6) | — | 181,400 | — | 140,132(7) | 5,816 | 473,185 |
Summary Compensation Table
| (1) Represents the discretionary bonus payout to each NEO for 2023 performance under the Company’s annual cash incentive award program. Dr. Kibarian elected to decrease his discretionary cash bonus payout from $90,450 to $39,577 to ensure the Company bonus pool would have additional funds to adequately reward and incentivize employees. |
Summary Compensation Table
| (2) The amounts reported in this column reflects the aggregate grant effective date fair value for financial statement reporting purposes for RSU awards granted in that year as determined in accordance with the Financial Accounting Standards Board Accounting Standards Codification Topic 718, or FASB ASC Topic 718. These amounts reflect our accounting expense for these awards and do not represent the actual economic value that may be realized by the Named Executive Officers. There can be no assurance that these amounts will ever be realized. For information on the assumptions used in valuing these awards, refer to the Note to the consolidated financial statements contained in the Company’s Annual Report on Form 10-K for the year in which the award was granted titled “Stockholder’s Equity.” |
Summary Compensation Table
| (3) The amounts reported in this column include the dollar value of premiums for term life insurance paid by us on behalf of each Named Executive Officer during the years ended December 31, 2023, 2022, and 2021. There is no cash surrender value under these life insurance policies. |
Summary Compensation Table
| (4) The amounts reported in this column include the dollar value of matching contributions by the Company under a 401(k) Retirement Savings Plan. |
Summary Compensation Table
| (5) Represents the PPCP bonus payout to each NEO for 2023 performance under the Company’s annual cash incentive award program. |
Summary Compensation Table
| (6) Includes salary paid to Dr. Strojwas as an employee prior to becoming an NEO in December 2021. |
Summary Compensation Table
| (7) Represents fees paid to Dr. Strojwas as a consultant prior to his joining the Company as an employee. |
Grants of Plan-Based Awards in Fiscal Year 2023
Grants of Plan-Based Awards in Fiscal Year 2023 The following table presents for 2023 certain information regarding grants of plan-based awards to our Named Executive Officers from our incentive plans.
Grants of Plan-Based Awards in Fiscal Year 2023
| Name | Grant Effective Date | Compensation and Human Capital Management Approval Date | Estimated Future Payouts under Non-Equity Incentive Plan Awards(1) | | | Estimated Future Payouts under Equity Incentive Plan Awards | | | All Other Stock Awards: Number of Shares of Stock Or Units (#)(2) | Grant Date Fair Value of Stock and Option Awards ($)(3) | | | | | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | John K. Kibarian | — | — | — | 135,000 | 135,000 | — | — | — | — | — | | Adnan Raza | — | — | — | 117,000 | 117,000 | — | — | — | — | — | | | 07/01/2023 | 06/13/2023 | — | — | — | — | — | — | 20,000 | 902,000 | | Kimon W. Michaels | — | — | — | 120,000 | 120,000 | — | — | — | — | — | | Andrzej Strojwas | — | — | — | 92,250 | 92,250 | — | — | — | — | — | | | 07/01/2023 | 06/13/2023 | — | — | — | — | — | — | 10,000 | 451,000 |
Grants of Plan-Based Awards in Fiscal Year 2023
| (1) Represents potential non-discretionary cash bonus eligible to be earned under the annual cash incentive award program for 2023. For more information, see “Compensation Discussion and Analysis — Annual Cash Incentive Award Program.” |
Grants of Plan-Based Awards in Fiscal Year 2023
| (2) Represents the RSUs granted in 2023 under our 2011 Stock Incentive Plan. 12.5% of the RSUs vest every six months after the Grant Effective Date until fully vested, subject to continued service through each applicable vesting date. For more information on the RSUs granted in 2023, see “Compensation Discussion and Analysis — Annual Long-Term Equity Incentive Awards.” |
Grants of Plan-Based Awards in Fiscal Year 2023
| (3) Represents the grant date fair value of RSU awards, in each case, determined in accordance with FASB ASC Topic 718. |
Outstanding Equity Awards as Of December 31, 2023
Outstanding Equity Awards as Of December 31, 2023 The following table presents the outstanding equity awards of each of our Named Executive Officers as of December 31, 2023.
Outstanding Equity Awards as Of December 31, 2023
| | | | | | | | | Market | | | | | | | | | Number | Value of | | | | | | | | | of | Shares | | | Compensation | | | | | | Shares | or | | | and | | | | | | or Units | Units of | | | Human | | Number of | Number of | | | of Stock | Stock | | | Capital | | Securities | Securities | | | That | That | | | Management | | Underlying | Underlying | Option | | Have | Have | | | Committee | Grant | Unexercised | Unexercised | Exercise | Option | Not | Not | | | Approval | Effective | Options (#) | Options (#) | Price | Expiration | Vested | Vested | | Name | Date | Date | Exercisable | Unexercisable | ($) | Date | (#) | ($) (3) | | John K. Kibarian | — | — | — | — | — | — | — | — | | Adnan Raza | 01/28/2020 | 02/01/2020 | — | — | — | — | 15,000(1) | 482,100 | | | 06/30/2021 | 07/01/2021 | — | — | — | — | 15,000(2) | 482,100 | | | 06/14/2022 | 07/01/2022 | — | — | — | — | 22,500(2) | 723,150 | | | 06/13/2023 | 07/01/2023 | — | — | — | — | 20,000(2) | 642,800 | | Kimon W. Michaels | — | — | — | — | — | — | — | — | | Andrzej Strojwas | 07/22/2020 | 08/01/2020 | — | — | — | — | 2,500(2) | 80,350 | | | 06/30/2021 | 07/01/2021 | — | — | — | — | 5,000(2) | 160,700 | | | 12/09/2021 | 01/01/2022 | — | — | — | — | 18,750(2) | 602,625 | | | 06/14/2022 | 07/01/2022 | — | — | — | — | 7,500(2) | 241,050 | | | 06/13/2023 | 07/01/2023 | — | — | — | — | 10,000(2) | 321,400 |
Outstanding Equity Awards as Of December 31, 2023
| (1) 25% of the total RSUs vested on December 31, 2020, and 12.5% vested on August 1, 2021, and every six months thereafter until fully vested, subject to continued service through each applicable vesting date. |
Outstanding Equity Awards as Of December 31, 2023
| (2) 12.5% of the total RSUs vest every six months after the Grant Effective Date until fully vested, subject to continued service through each applicable vesting date. |
Outstanding Equity Awards as Of December 31, 2023
| (3) The market value is calculated by multiplying the number of unvested shares subject to the RSU awards held by each NEO as of December 31, 2023, by the closing market price of the Company’s common stock on December 29, 2023 ($32.14 per share), which was the last business day of the year. |
Options Exercised and Stock Vested in 2023
Options Exercised and Stock Vested in 2023 The following table presents the options exercised by our Named Executive Officers in 2023 and RSUs held by our NEOs that vested in 2023.
Options Exercised and Stock Vested in 2023
| | Option Awards | | Stock Awards | | | | Number | | Number of | | | | of Shares | Value | Shares | Value | | | Acquired | Realized | Acquired | Realized on | | | on Exercise | on Exercise | on Vesting | Vesting | | Name | (#) | ($)(1) | (#) | ($)(1) | | John K. Kibarian | — | — | — | — | | Adnan Raza | — | — | 45,000 | 1,729,350 | | Kimon W. Michaels | — | — | — | — | | Andrzej Strojwas | — | — | 17,500 | 650,250 |
Options Exercised and Stock Vested in 2023
| (1) The values of the vested awards were determined based on the number of shares that vested multiplied by the per share closing sale price on The Nasdaq Stock Market LLC reported for the applicable vesting date. |
Pension Benefits
Pension Benefits We did not sponsor any defined benefit pension or other actuarial plan for the Named Executive Officers during 2023.
Non-qualified Deferred Compensation
Non-qualified Deferred Compensation We did not maintain any non-qualified defined contribution or other deferred compensation plans or arrangements for the Named Executive Officers during 2023.
Employment Agreement with Mr. Raza
| | Value of the | | | Hypothetical Benefit | | | and Payment Amount | | Executive Benefits and Payments upon Termination of Employment | (change in control) ($) | | Vesting acceleration of outstanding and unvested RSUs | 803,500(1) | | Base salary | 195,000 | | Guaranteed minimum cash bonus | 82,500 | | Premiums for COBRA coverage | 13,709 | | Total | 1,094,709 |
Employment Agreement with Mr. Raza
| | Value of the | | | Hypothetical Benefit | | | and Payment Amount | | Executive Benefits and Payments upon Termination of Employment | (change in control) ($) | | Vesting acceleration of outstanding and unvested RSUs | 2,330,150(1) | | Base salary | 390,000 | | Additional base salary payment | 195,000 | | Premiums for COBRA coverage | 27,418 | | Total | 2,942,568 |
2023 CEO Pay Ratio Disclosure
2023 CEO Pay Ratio Disclosure For 2023, our last completed fiscal year:
2023 CEO Pay Ratio Disclosure
| ▪ | the median of the annual total compensation of all employees of our Company (other than Dr. Kibarian, our CEO) was $108,156; and |
2023 CEO Pay Ratio Disclosure
| ▪ | the annual total compensation of our CEO was $595,919. |
2023 CEO Pay Ratio Disclosure
Based on this information, for 2023, the ratio of the annual total compensation of Dr. Kibarian to the median of the annual total compensation of all employees was 5.51 to 1. The pay ratio included in this information is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K. We describe the methodology and the material assumptions, adjustments, and estimates that we used to identify the median of the annual total compensation of all of our employees and to determine the annual total compensation of the “median employee” below. Due to the different methodologies and assumptions that are allowed to be utilized to determine the median employee, the pay ratio disclosures are not intended to facilitate a company-to-company comparison. Determination Date and Measurement Period We selected December 31, 2023, which is within the last three months of 2023, as the date upon which we would identify our employees for purposes of determining the “median employee.” The compensation of such employees was then considered over a measurement period consisting of the 12-month period ended December 31, 2023. Employee Population We determined that, as of December 31, 2023, our employee population consisted of approximately 493 individuals working for PDF Solutions, Inc., and its wholly-owned subsidiaries. Compensation Measure Utilized to Identify the Median Employee To identify a new “median employee” from our employee population for 2023, we utilized a compensation measure consisting of base pay, including commissions, bonuses, and allowances (“Cash Compensation”). We annualized the compensation of permanent employees who were hired in 2023 but did not work for us or our wholly-owned subsidiaries for the entire fiscal year. We also did not make any cost-of-living adjustments in identifying the “median employee.” We determined that annual equity awards, which are not widely distributed to our employees, do not reasonably reflect the annual compensation of our employees. Accordingly, annual equity awards were excluded from Cash Compensation. We converted all employee compensation, on a country-by-country basis, to U.S. dollars based on the applicable year-end exchange rate used by the Company in its financial reporting. Description of the Median Employee Using this methodology, we determined that the “median employee” was a full-time salaried employee located in California, USA. This section provides disclosure about the relationship between executive compensation actually paid to our principal executive officer (PEO) and non-PEO NEOs and certain financial performance measures of the Company for the years listed below. This disclosure has been prepared in accordance with Item 402(v) of Regulation S-K under the Exchange Act (the “Pay Versus Performance Rules”) and does not necessarily reflect how the CHCM Committee evaluates compensation decisions.
2023 CEO Pay Ratio Disclosure
| | | | Average | | Value of Initial Fixed $100 | | | | | | | | Summary | Average | Investment Based On:(5) | | | | | | Summary | | Compensation | Compensation | | Peer Group | | GAAP | | | Compensation | Compensation | Table Total | Actually Paid | Total | Total | | Revenue | | | Table Total | Actually Paid | for Non-PEO | to Non-PEO | Stockholder | Stockholder | Net Income (Loss) | Growth | | Year(1) | for PEO | to PEO(2)(3) | NEOs | NEOs(2)(4) | Return | Return | (millions) | (millions)(6) | | 2023 | $595,919 | $595,919 | $995,962 | $1,169,470 | $190 | $152 | $3.1 | $17.3 | | 2022 | $654,620 | $654,620 | $1,149,146 | $1,051,341 | $169 | $126 | $(3.4) | $37.5 | | 2021 | $409,105 | $409,105 | $668,245 | $1,374,237 | $188 | $162 | $(21.5) | $23.0 | | 2020 | $400,405 | $400,405 | $900,314 | $1,137,381 | $128 | $128 | $(40.4) | $2.5 |
2023 CEO Pay Ratio Disclosure
| (1) The following table lists the PEO and non-PEO NEOs for each of 2020, 2021, 2022 and 2023. |
2023 CEO Pay Ratio Disclosure
| Year | PEO | Non-PEO NEOs | | 2023 | John K. Kibarian | Adnan Raza, Kimon W. Michaels, and Andrzej Strojwas | | 2022 | John K. Kibarian | Adnan Raza, Kimon W. Michaels, and Andrzej Strojwas | | 2021 | John K. Kibarian | Adnan Raza and Andrzej Strojwas | | 2020 | John K. Kibarian | Adnan Raza, Kimon W. Michaels and Christine A. Russell |
2023 CEO Pay Ratio Disclosure
| (2) The dollar amounts reported represent the amount of “compensation actually paid,” as calculated in accordance with the Pay Versus Performance Rules. These dollar amounts do not reflect the actual amounts of compensation earned by or paid to our NEOs during the applicable year. For purposes of calculating “compensation actually paid,” the fair value of equity awards is calculated in accordance with ASC Topic 718 using the same assumption methodologies used to calculate the grant date fair value of awards for purposes of the Summary Compensation Table (refer to “Executive Compensation and Other Information – Summary Compensation Table” for additional information). |
2023 CEO Pay Ratio Disclosure
| (3) The following table shows the amounts deducted from and added to the Summary Compensation Table total to calculate “compensation actually paid” to Dr. Kibarian in accordance with the Pay Versus Performance Rules: |
2023 CEO Pay Ratio Disclosure
| | Pension Plan Adjustments | | | Equity Award Adjustments | | | | | | | | | | Summary Compensation Table Total for PEO | Change in Pension Value | Pension Service Cost | Stock Awards | Year End Fair Value of Equity Awards Granted in the Year and Unvested at Year End | Year over Year Change in Fair Value of Outstanding and Unvested Equity Awards Granted in Prior Years | Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Year | Change in Fair Value of Equity Awards Granted in Prior Years that Vested in the Year | Fair Value at the End of the Prior Year of Equity Awards that Failed to Meet Vesting Conditions in the Year | Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value | Compensation Actually Paid to PEO | | 2023 | $595,919 | $— | $— | $— | $— | $— | $— | $— | $— | $— | $595,919 | | 2022 | $654,620 | $— | $— | $— | $— | $— | $— | $— | $— | $— | $654,620 | | 2021 | $409,105 | $— | $— | $— | $— | $— | $— | $— | $— | $— | $409,105 | | 2020 | $400,405 | $— | $— | $— | $— | $— | $— | $— | $— | $— | $400,405 |
2023 CEO Pay Ratio Disclosure
| (4) The following table shows the amounts deducted from and added to the average Summary Compensation Table total compensation to calculate the average “compensation actually paid” to our non-PEO NEOs in accordance with the Pay Versus Performance Rules: |
2023 CEO Pay Ratio Disclosure
| | Pension Plan Adjustments | | | Equity Award Adjustments | | | | | | | | | | | | | | | | | | | Value of | | | | | | | | | | | | | Dividends | | | | | | | | | Year over | Fair | | | or other | | | | | | | | | Year Change | Value as | | Fair Value at | Earnings | | | | | | | | | in Fair Value | of | | the End of | Paid on | | | | | | | | Year End | of | Vesting | Change in | the Prior | Stock or | | | | | | | | Fair Value of | Outstanding | Date of | Fair Value of | Year | Option | | | | | | | | Equity | and | Equity | Equity | of Equity | Awards | | | | Summary | | | | Awards | Unvested | Awards | Awards | Awards that | not | | | | Compensation | Change | | | Granted in | Equity | Granted | Granted in | Failed to | Otherwise | Compensation | | | Table Total | in | Pension | | the Year and | Awards | and | Prior Years | Meet Vesting | Reflected | Actually Paid | | | for Non-PEO | Pension | Service | Stock | Unvested at | Granted in | Vested in | that Vested in | Conditions | in Fair | to Non-PEO | | | NEOs | Value | Cost | Awards | Year End | Prior Years | the Year | the Year | in the Year | Value | NEOs | | 2023 | $995,962 | $— | $— | $(451,000) | $321,400 | $104,075 | $— | $199,033 | $— | $— | $1,169,470 | | 2022 | $1,149,146 | $— | $— | $(594,567) | $629,817 | $(89,925) | $25,938 | $(69,068) | $— | $— | $1,051,341 | | 2021 | $668,245 | $— | $— | $(362,800) | $635,800 | $463,645 | $— | $(30,653) | $— | $— | $1,374,237 | | 2020 | $900,314 | $— | $— | $(630,400) | $972,000 | $— | $324,000 | $21,867 | $(450,400) | $— | $1,137,381 |
2023 CEO Pay Ratio Disclosure
| (5) In accordance with the Pay Versus Performance Rules, the Company and the Company’s peer group total stockholder return (the “Peer Group TSR”) is determined based on the value of an initial fixed investment of $100 on December 31, 2019, through the end of the listed year. The Peer Group TSR set forth in this table was determined using the S&P 600 Information Technology (Sector) (TR) Index, which we also use in preparing the stock performance graph required by Item 201(e) of Regulation S-K for our Annual Report for the year ended December 31, 2023. |
2023 CEO Pay Ratio Disclosure
| (6) We have determined that GAAP Revenue Growth is the financial performance measure that, in the Company’s assessment, represents the most important financial performance measure used to link “compensation actually paid” to our NEOs, for 2023, to company performance (the “Company Selected Measure” as defined in the Pay Versus Performance Rules). GAAP Revenue Growth means our revenue growth year-over-year, as calculated on GAAP basis. |
Relationship Between “Compensation Actually Paid” and Performance Measures
Relationship Between “Compensation Actually Paid” and Performance Measures In accordance with the Pay Versus Performance Rules, the charts below illustrate how “compensation actually paid” to the NEOs aligns with the Company’s financial performance as measured by TSR, net income (loss), and pre-tax net income, as well as a comparison of TSR and Peer Group TSR. Compensation Actually Paid and TSR Compensation Actually Paid and Net Income (Loss) Compensation Actually Paid and GAAP Revenue Growth TSR of the Company and TSR of the Peer Group
Director Compensation
Director Compensation Directors who are also employees of the Company are not compensated for serving on our Board of Directors. Information regarding the compensation otherwise received by our directors, who are also executive officers, is provided above. The CHCM Committee of the Board reviews director compensation periodically and recommends changes to the Board, when it deems them appropriate. The following table describes the cash and equity components of the director compensation program that was in effect for 2023:
Director Compensation
| 2023 Compensation Element | Amount | | Annual cash retainer | $40,000 for each non-employee director (1) Additional $20,000 for lead independent director (1)(4) | | Annual equity award | RSUs valued at $150,000 for each non-employee director (2) | | Additional annual cash retainer for Audit Committee | $15,000 (chair); $7,500 (member) (1) | | Additional annual cash retainer for CHCM Committee | $10,000 (chair); $5,000 (member) (1) | | Additional annual cash retainer for NCG Committee | $8,000 (chair); $4,000 (member) (1) | | New Director equity award (one-time) | RSUs valued at $300,000 (3)(4) |
Director Compensation
| (1) Cash retainers are paid in four equal quarterly installments at the beginning of each calendar quarter (pro-rated for any partial periods). |
Director Compensation
| (2) Annual awards of RSUs are targeted to be awarded each year when the Company awards the annual merit/refresh awards on a company-wide basis to each director who has served as a director to the Company for at least 90 days prior to the date such awards are approved. Annual RSU awards vest with respect to 1/12th of the total shares subject to the RSU on the grant effective date and 1/12th of the total shares monthly after the grant effective date until fully vested (i.e. over a one-year period). |
Director Compensation
| (3) Initial RSU awards to a new director vest with respect to 1/4th of the total shares on the grant effective date and 1/4th of the total shares subject to such award every anniversary of the grant effective date thereafter until fully vested (i.e. over a three-year period). |
Director Compensation
| (4) The total number of shares subject to such awards is equal to the dollar value using a per share price equal to the closing price on the last trading day prior to the date of the meeting to approve such award. |
Director Compensation Table
Director Compensation Table Our non-employee directors received the following compensation during the year ended December 31, 2023:
Director Compensation Table
| | Fees | | | | | | | Earned | Stock | Option | All Other | | | | or Paid in | Awards | Awards | Compensation | | | Name | Cash ($) | ($)(1) | ($)(2) | ($) | Total ($) | | Chi-Foon Chan | 13,129 | — | — | — | 13,129 | | Joseph R. Bronson | 75,500 | 151,265 | — | — | 226,765 | | Nancy Erba | 68,750 | 151,265 | — | — | 220,015 | | Michael B. Gustafson | 71,875 | 151,265 | — | — | 223,140 | | Ye Jane Li | 56,250 | 151,265 | — | — | 207,515 | | Shuo Zhang | 61,250 | 151,265 | — | — | 212,515 |
Director Compensation Table
| (1) The amounts reported in this column reflect the aggregate grant date fair value for financial statement reporting purposes for the RSUs granted in 2023 as determined in accordance with the FASB ASC Topic 718. These amounts reflect our accounting expense for these awards and do not represent the actual value that may be realized by our non-employee directors. For information on the assumptions used in valuing these RSUs, refer to the Note to the consolidated financial statements contained in our Annual Report on Form 10-K for 2023 titled “Employee Benefits Plan.” The outstanding and unvested RSUs held by each non-employee director on December 31, 2023, were: Mr. Bronson (2,846); Ms. Erba (2,846); Mr. Gustafson (2,846); Ms. Li (4,861); and Ms. Zhang (2,846). |
Director Compensation Table
| (2) Each non-employee director did not hold any outstanding stock options as of December 31, 2023. |
Director Compensation Table
We have entered into acceleration agreements (each, an “Acceleration Agreement”) with Mr. Bronson, Dr. Chan, Ms. Erba, Mr. Gustafson, Ms. Li, and Ms. Zhang. Pursuant to each Acceleration Agreement all the stock awards covering shares of the Company’s common stock that have been granted or will be granted to each of the aforementioned directors will become vested (and exercisable, if applicable) in full in the event of a change in control of the Company. Each of the acceleration agreements will generally remain in effect until terminated by the Company or, if earlier, the date a director ceases to provide services to the Company.