DEF 14A of Joby Aviation, Inc.
Filed Apr 25, 2024 · FY20230001819848-24-000255
PROPOSAL ONE: ELECTION OF DIRECTORS
PROPOSAL ONE: ELECTION OF DIRECTORS Our board of directors currently consists of nine directors and is divided into three classes, with staggered three-year terms. Directors in Class III will stand for election at the Annual Meeting. The terms of office of directors in Class I and Class II expire at our annual meetings to be held in 2025 and 2026, respectively. At the recommendation of our nominating and corporate governance committee, our board of directors proposes that each of the Class III nominees named below be elected as a Class III director for a three-year term expiring at our 2027 annual meeting of stockholders or until such director’s successor is duly elected and qualified or until such director’s earlier death, resignation, disqualification or removal. Shares represented by proxies will be voted “FOR” the election of each of the nominees named below unless the proxy is marked to withhold authority to vote. If any nominee for any reason is unable or unwilling to serve the proxies may be voted for such substitute nominee as the proxy holder might determine. Each nominee has consented to being named in this proxy statement and to serve if elected. Proxies may not be voted for more than three directors. Stockholders may not cumulate votes for the election of directors.
Nominees to Our Board of Directors
Nominees to Our Board of Directors The following sets forth information regarding our nominees, including their ages as of April 1, 2024:
Nominees to Our Board of Directors
| Age: 50 Director Since: 2009 Committees: None | JoeBen Bevirt Chief Executive Officer, Joby Aviation | | | Biography: JoeBen Bevirt is our founder, Chief Executive Officer, Chief Architect and a member of our board of directors. Mr. Bevirt has led our team since its inception in 2009. He has dedicated his life to driving revolutionary innovation in electric propulsion and robotics. In 1999, Mr. Bevirt co-founded Velocity11, a company that developed high-performance robotic laboratory systems, which was later acquired by Agilent Technologies. In 2005, he founded Joby Inc., a company that makes utilitarian consumer products including the popular Gorillapod flexible camera tripod. He holds a B.S. in mechanical engineering from University of California Davis and an M.S. in mechanical engineering from Stanford University. | | | Qualifications: Mr. Bevirt, given his extensive experience in electric propulsion, robotics and managing companies, is qualified to serve as a member of our board of directors due to this one-of-a-kind perspective he brings as our founder and Chief Executive Officer. |
Nominees to Our Board of Directors
| Age: 55 Director Since: 2020 Committees: Compensation (Chair) Audit | Aicha Evans Chief Executive Officer, Zoox | | | Biography: Aicha Evans has served as a member of our board of directors since December 2020. Since February 2019, Ms. Evans has been the Chief Executive Officer of Zoox, Inc., an autonomous vehicle company acquired by Amazon.com, Inc. in 2020. Prior to that, Ms. Evans worked at Intel Corporation, a multinational corporation and technology company, where she served as Corporate Strategy Officer and Senior Vice President from March 2017 through February 2019 and Corporate Vice President, Communication and Devices Group from February 2014 through February 2016. Ms. Evans currently serves as a member of the board of directors on the compensation, technology and safety, and people and organization committees of SAP SE. Ms. Evans holds a B.S. in computer engineering from The George Washington University. | | | Qualifications: Ms. Evans’ success in senior leadership positions and public company board experience make her well qualified to serve as a member of our board of directors. |
Nominees to Our Board of Directors
| Age: 47 Director Since: Nominee Committees: None | Michael Thompson Managing Partner, Reinvent Capital | | | Biography: Michael Thompson has served as a co-founder and managing partner of Reinvent Capital, a private investment fund focused on technology companies, since 2017. He also served as the Chief Executive Officer and director of RTP from 2020 to 2021. Prior to Reinvent Capital, Mr. Thompson was the founder and managing partner of BHR Capital, a New York-based hedge fund. In addition, he has invested in and served as an advisor and board member for several technology companies. Mr. Thompson holds a Bachelor of Business Administration in International Finance from the Honors Program at the University of Georgia. | | | Qualifications: Mr. Thompson’s experience as an investor in and advisor to technology companies make him well qualified to serve as a member of our board of directors. If elected, Mr. Thompson will serve as RTP’s nominee pursuant to our agreement with Sponsor. |
Continuing Directors
Continuing Directors The following sets forth information regarding our directors who are serving for terms that end after the Annual Meeting, including their ages as of April 1, 2024:
Continuing Directors
| Age: 48 Director Since: 2021 Committees: Nominating & Governance (Chair) Audit | Halimah DeLaine Prado General Counsel, Google LLC | | | Biography: Halimah DeLaine Prado has served as a member of our board of directors since August 2021. Since August 2020, Ms. DeLaine Prado has served as General Counsel of Google, LLC, where she has held a number of roles in the legal department since 2006. Prior to joining Google, Ms. DeLaine Prado practiced media law and products liability law at Dechert LLP and Levine Sullivan Koch and Shulz. She also clerked for the Honorable Mary A. McLaughlin of the United States District Court for the Eastern District of Pennsylvania. Ms. DeLaine Prado holds a B.A. from Yale University and a J.D. from Georgetown University Law Center. | | | Qualifications: Ms. DeLaine Prado’s experience as a leader in the legal and technology industries makes her well qualified to serve as a member of our board of directors. |
Continuing Directors
| Age: 67 Director Since: 2023 Committees: Compensation | Michael Huerta Former Administrator, Federal Aviation Administration | | | Biography: Michael P. Huerta has served as a member of our board of directors since March 2023. Mr. Huerta currently serves as a transportation and aviation industry consultant. He previously served as Administrator for the United States Federal Aviation Administration from 2013 to 2018. Before being named as Administrator, Mr. Huerta served as Acting Administrator of the FAA from 2011 to 2013 and FAA Deputy Administrator from 2010 to 2011. Mr. Huerta also served as Executive Vice President and Group President, Government Transportation, for Affiliated Computer Services, Inc., now Conduent, Inc. Mr. Huerta has served as an independent director of Delta Air Lines, Inc. since 2018, and is a member of Delta Air Lines’ Audit Committee and Safety and Security Committee. Since May 2021, he has also served as an independent member of the board of directors of Verra Mobility Corporation and is chair of the Nominating and Corporate Governance Committee. Mr. Huerta holds a B.A. in Political Science from the University of California, Riverside and an M.A. in Public Affairs with a concentration in international relations from Princeton University. | | | Qualifications: Mr. Huerta’s prior experience with the FAA and extensive aviation history make him well qualified to serve as a member of our board of directors. Mr. Huerta is currently serving as Delta’s nominee pursuant to the Delta Agreement. |
Continuing Directors
| Age: 64 Director Since: 2023 Committees: None | Tetsuo “Ted” Ogawa Operating Officer, Toyota Motor Corporation | | | Biography: Mr. Ogawa has been Director, President and Chief Executive Officer of Toyota Motor North America, Inc. (“TMNA”) since April 2020 and Operating Officer of Toyota Motor Corporation (“TMC”) in April 2023. Mr. Ogawa previously served as Chief Executive Officer, North America Region of TMC from April 2020 to March 2023, Operating Officer of TMC from January 2019 to December 2020, Chief Operating Officer, North America Region of TMC from January 2019 to April 2020 and Deputy Chief Officer - External and Public Affairs Group of TMC from January 2019 to July 2019. He served as Executive Vice President of TMNA from April 2017 to March 2020 and Senior Managing Officer of TMC from January 2018 to January 2019. He also served as Chief Administrative Officer – North America Region of TMC from April 2017 to January 2019. Prior to this, Mr. Ogawa served as Managing Officer of TMC from April 2015 to January 2018 and Deputy Chief Executive Officer – China Region of TMC and President, Toyota Motor (China) Investment Co., Ltd. from April 2015 to April 2017. Mr. Ogawa first joined TMC in 1984. Mr. Ogawa holds a bachelor’s degree in commerce and management from Hitotsubashi University. | | | Qualifications: Mr. Ogawa’s extensive expertise in operational and leadership roles at Toyota make him well qualified to serve on our board of directors. Mr. Ogawa is currently serving as Toyota’s designee pursuant to the Toyota MOU. |
Continuing Directors
| Age: 59 Director Since: 2016 Committees: Nominating & Corporate Governance | Dipender Saluja Managing Director, Capricorn Investment Group | | | Biography: Dipender Saluja has served as a member of our board of directors since November 2016, after he led the Company’s Series A financing. Mr. Saluja has served as Managing Director of Capricorn Investment Group, an investment firm, since 2006. Prior to Capricorn Investment Group, he served in various positions from 1990 to 2006 at Cadence Design Systems, an electronic design company. Mr. Saluja currently serves on the boards of QuantumScape and Navitas Semiconductor, and on the boards of several private companies. | | | Qualifications: Mr. Saluja’s extensive operational, management, strategy, investment and directorship experience, particularly in the areas of technology, electronics, semiconductors, transportation, renewable energy and cleantech, make him well qualified to serve as a member of our board of directors. |
Continuing Directors
| Age: 43 Director Since: 2016 Committees: | Paul Sciarra Chairman of the Board | | | Biography: Paul Sciarra has served as the Executive Chairman and a member of our board of directors since November 2016 and was our first outside investor. Lending his deep product knowledge and business acumen to the Company, he was instrumental in the move to a four-seat aircraft operating within a service-based model. In August 2008, Mr. Sciarra co-founded Pinterest, Inc., an image sharing and social media service company. Mr. Sciarra also served as an entrepreneur-in-residence at Andreessen Horowitz, a venture capital firm. Mr. Sciarra holds a B.A. from Yale University. | | | Qualifications: Mr. Sciarra’s experience as an entrepreneur along with his contributions to Joby as its Executive Chairman make him well qualified to serve as a member of our board of directors. |
Continuing Directors
| Age: 64 Director Since: 2021 Committees: Audit (Chair) Compensation | Laura Wright Former Chief Financial Officer, Southwest Airlines | | | Biography: Laura Wright has served as a member of our board of directors since August 2021. Until 2020, she consulted under GSB Advisory LLC, which she founded in 2012, to provide interim executive and financial management to growth and non-profit companies. From 1988 to 2012, Ms. Wright served in a number of roles at Southwest Airlines Co., a commercial airline, most recently as Senior Vice President, Chief Financial Officer, and Corporate Officer. Ms. Wright currently serves as a member of the board of directors of CMS Energy Corp. and its subsidiary Consumers Energy, TE Connectivity Ltd. and Spirit AeroSystems Holdings, Inc. and was a member of the board of directors of Pebblebrook Hotel Trust from December 2009 to February 2019, as well as a member of the audit and compensation committees. Ms. Wright holds a B.S. and an M.S. from University of North Texas and is a certified public accountant. | | | Qualifications: Ms. Wright’s experience in the aviation industry and on multiple public company boards of directors, as well as her financial expertise, make her well qualified to serve as a member of our board of directors. |
Director Compensation
Director Compensation The table below sets forth information regarding non-employee director compensation for the fiscal year ended December 31, 2023.
Director Compensation
| Name | Fees earned or paid in cash ($)(1) | Stock awards ($)(2) | Total ($) | | Aicha Evans | 75,000 | 150,223 | 225,223 | | Reid Hoffman | 55,000 | 154,102 | 209,102 | | Michael Peter Huerta | 42,374 | 180,370 | 222,744 | | James Kuffner | 25,000 | 151,136 | 176,136 | | Halimah DeLaine Prado | 70,000 | 150,223 | 220,223 | | Dipender Saluja | 55,000 | 154,102 | 209,102 | | Paul Sciarra | 50,000 | 153,752 | 203,752 | | Tetsuo Ogawa | 25,000 | 173,025 | 198,025 | | Laura Wright | 77,500 | 150,223 | 227,723 |
Director Compensation
_______________ (1)Amounts for Messrs. Hoffman, Kuffner, Saluja and Sciarra include cash retainer fees foregone at the election of our directors, which amounts were instead paid in the form of fully vested RSUs in 2023. (2)The amounts set forth in this column reflect the grant date fair value of all awards granted in 2023 calculated in accordance with FASB ASC Topic 718 and excluding the effects of any forfeitures. As of December 31, 2023, Ms. Evans held an option to purchase 13,047 shares of our common stock. Additionally, as of December 31, 2023, each of our non-employee directors except for Mr. Kuffner had an outstanding restricted stock unit award for 22,556 shares (except for Mr. Ogawa, who had an outstanding award for 16,864 shares) that will vest on June 14, 2024. (3)Mr. Kuffner resigned from the board of directors, effective June 30, 2023.
Compensation Summary
Compensation Summary Our executive compensation program is designed to attract and retain the executive leadership necessary to meet our ambitious goal of certifying our aircraft and launching our commercial air taxi service. Until we are able to certify our aircraft and launch our commercial passenger service, we are highly focused on preserving cash. Because of this, we do not pay cash bonuses and have weighted our executive compensation more heavily in favor of equity awards, including short-term and long-term incentive awards with performance conditions tied to our certification goals. We believe this approach most closely aligns the interests of our executives with those of our stockholders. We have structured our executive compensation program to align with industry best practices, including the following:
Compensation Summary
| Committee Composition | All of our Compensation Committee members are independent directors. | | Compensation Consultant | Our Compensation Committee retains an independent compensation consultant to provide data and analysis to ensure that our executive compensation is competitive and in line with market best practices. | | Clawback Policy | We have adopted a clawback policy that applies to current and former officers and requires the disgorgement of erroneously awarded incentive-based compensation. | | Stock Ownership Guidelines | We require our executive officers and members of our board of directors to comply with meaningful stock ownership requirements, subject to a customary phase-in period. | | Limited Perquisites | We limit perquisites to our executive officers. | | Say-On-Pay Vote | We hold an annual advisory vote on the compensation of our named executive officers. | | No Severance Payments and Benefits | None of our executive officers have provisions in their employment agreements guaranteeing severance payments and benefits in the event of their termination of employment. | | No “Single-Trigger” Vesting Acceleration | None of our executive officers have provisions for “single-trigger” acceleration of equity vesting in connection with a change-of-control of the Company. | | Risk Assessment | Our Compensation Committee performs an annual review of the risks related to our compensation programs. |
Compensation Consultant
Compensation Consultant The Compensation Committee retained Compensia, Inc., a national compensation consulting firm (“Compensia”), as its compensation consultant for 2023. Compensia’s services in 2023 included: •providing relevant financial and other data to assist the Compensation Committee with the selection of the peer group as described below; •collecting and analyzing data from peer group companies, as well as the additional compensation surveys described below, to provide an understanding of the competitiveness of the base salary levels, short-term and long-term incentive compensation opportunities of our executives, including our NEOs; •assisting with the review of the executive compensation disclosure required in our proxy statement and •updating the Compensation Committee on compensation trends and regulatory updates, including best practices.
Compensation Peer Group
Compensation Peer Group In December 2022, with Compensia’s assistance, the Compensation Committee reviewed and updated its compensation peer group to be used as a reference for compensation decisions for 2023, which was generally developed from publicly-traded companies in the aviation, automotive, clean energy, electrical component & equipment, electric vehicle, semiconductor and technology hardware & equipment industries with a market capitalization of approximately $844 million to $13.5 billion (within a target range of 0.25 – 4.0 times our 30-day average market capitalization of approximately $3.34 billion as of October 2022). Based on the foregoing review, the Compensation Committee approved a peer group that consisted of AeroVironment, Archer Aviation, Blink Charging Co., Bloom Energy, ChargePoint Holdings, Enovix, Eve Holding, First Solar, Fisker, Lucid Group, Luminar Technologies, Lyft, Nikola, Plug Power, Proterra, QuantumScape, Rocket Lab USA, Sunrun, TuSimple Holdings and Virgin Galactic Holdings (collectively, the “Peer Group”). At the time the Peer Group data was compiled, we were at the 56th percentile by market capitalization compared to the other members of the Peer Group. The Compensation Committee removed Cerence, EnerSys, Enphase Energy, FuelCell Energy, Teledyne Technologies, Textron, and Wheels Up Experience, which had previously been part of the compensation peer group used for analyzing the Company’s 2022 compensation, as these companies no longer fit within the Company’s selection criteria. Velodyne Lidar was removed as a result of its acquisition by Ouster. These companies were replaced by Blink Charging Co., Enovix, Eve Holding, Fisker, Lucid Group, and Rocket Lab USA, which the Compensation Committee determined better met the parameters described above. In addition, the Compensation Committee reviewed a Radford custom survey of 50 similarly sized public companies, including 13 out of 20 public peers, reflecting similarly-sized companies (the “Custom Survey”) as well as data from the Radford San Francisco Bay Area technology survey (the “Technology Survey”). In evaluating compensation decisions during 2023, the Compensation Committee referenced each of the Peer Group, Custom Survey and Technology Survey, focusing on the source most applicable to the position being evaluated.
Elements of Compensation
| Element | Purpose | | Base Salary | Base salary is designed to provide our NEOs with a predictable level of compensation for the day-to-day performance of their roles. Base salaries are set at a level designed to remain competitive in a given market to ensure predictable income so that our NEOs are sufficiently compensated on a day-to-day basis and are not overly dependent on the achievement of performance bonus award targets or equity appreciation in a way that might encourage excessive risk taking to achieve our goals. | | Equity Awards That Are Granted upon Achievement of Performance Goals (“PSUs”) | We maintained a performance bonus program under which dollar-denominated targets and maximums were established and restricted stock units (“RSUs”) were granted after the achievement of key goals related to our development and certification timelines. These goals, which were the same for all employees, including our NEOs, were designed to reward and focus the efforts of all employees in these areas. |
Elements of Compensation
| Element | Purpose | | Equity Awards with Service-Based Vesting (“Service-Based RSUs”) | RSU awards granted with service-based vesting are intended to align the interests of our NEOs with those of our stockholders and to encourage retention. We grant RSUs in connection with an NEO’s commencement of employment and may award additional grants on an annual basis for retention purposes. | | Long-Term Performance Awards | Recognizing the importance of certification to the success of our business, in 2023 we also granted performance-based awards to our NEOs that will vest on the third anniversary of the grant date provided that certain performance conditions related to certification are met on or before that date (the “LTI Goal”). |
Equity Awards
Equity Awards We grant RSU awards to our NEOs under our 2021 Incentive Award Plan (“2021 Plan”). These awards are designed to attract and retain our NEOs and to align their interests with the interests of our stockholders. Each RSU represents the right to receive one share of our common stock upon vesting. Any unvested RSU awards are forfeited if an employee or NEO ceases to provide services to the Company. In 2023, the Compensation Committee granted three types of equity awards to our NEOs: 1.Service-Based RSUs, provided as an annual refresh grant to ensure continued equity vesting over time and retain critical individuals (the “Service-Based Awards”); 2.RSU awards that vest after three years of continued service, provided that the LTI Goal has been met (the “LTI Awards”); and 3.PSUs granted under the Company’s 2023 performance equity award program (the “2023 PSU Program”), which are only granted following the achievement of pre-established goals that apply to all employees. For 2023, the Compensation Committee made grants to our NEOs (except for Mr. Bevirt) that consisted of an equal number of units for each Service-Based Award and LTI Award. Mr. Bevirt was only granted an LTI Award to further tie his compensation to performance. The Compensation Committee determined that these grants, combined with the NEO’s base salary and equity awards under the 2023 PSU Program (assuming target achievement levels) would place the NEOs’ target total direct compensation below the competitive market median values based on an executive compensation analysis prepared by the Compensation Committee’s compensation consultant. However, the Compensation Committee believed that the total direct compensation targets provided sufficient retention value and incentive for our NEOs to execute on the Company’s strategic goals, while reflecting the Company’s overall disciplined approach to equity budgeting and compensation philosophy. In June 2023, the Compensation Committee granted the following Service-Based Awards to our NEOs (other than Mr. Bevirt). The Service-Based Awards vest over four years, in 16 equal installments on the quarterly anniversaries of July 1, 2023, subject to the NEO’s continued employment with us through each such applicable vesting date.
Equity Awards
| Name | Service-Based RSU Award (# of units) | Grant-Date Fair Value of Award | | JoeBen Bevirt | — | $— | | Matt Field | 98,784 | $677,658 | | Didier Papadopoulos | 121,580 | $834,039 | | Kate DeHoff | 83,586 | $573,400 | | Bonny Simi | 91,185 | $625,529 |
Equity Awards
In June 2023, the Compensation Committee granted the following LTI Awards to our NEOs other than Mr. Bevirt, whose LTI Award for Mr. Bevirt was approved by the full Board. The LTI Awards vest on June 21, 2026, provided that the LTI Goal has been achieved on or before that date. The LTI Goal involves confidential information, the disclosure of which would cause competitive harm to us. The LTI Goal was set in a manner our Compensation Committee and, in the case of Mr. Bevirt, our board of directors determined would be difficult to achieve and will not be achieved with average or below average effort.
Equity Awards
| Name | LTI Award (# of units) | Grant-Date Fair Value of Award | | JoeBen Bevirt | 303,951 | $3,118,537 | | Matt Field | 98,784 | $677,658 | | Didier Papadopoulos | 121,580 | $834,039 | | Kate DeHoff | 83,586 | $573,400 | | Bonny Simi | 91,185 | $625,529 |
Equity Awards
In February 2023, the Compensation Committee adopted the 2023 PSU Program. All of our employees, including our NEOs, were eligible to participate in the 2023 PSU Program. Under the 2023 PSU Program, a target and maximum bonus amount was established in dollars for each of our NEOs. Subject to our achievement of certain operational, manufacturing, and business goals in 2023, RSUs were awarded as described below. Much like our 2022 program, the goals for the 2023 PSU Program covered three broad areas aligned with our overall Company focus on development and certification, manufacturing, and commercialization. The goals, which were selected by management and approved by our Compensation Committee, were designed to be challenging and to reward outstanding performance against our operational goals and objectives. We believe that the targets and goals reflected in the 2023 PSU Program align the interests of our employees, including our NEOs, with our Company’s progress and our stockholders’ interests. Each of the targets for the selected goals involves confidential information, the disclosure of which would cause competitive harm to the Company (with the exception of the goals noted in the table below). The Compensation Committee believed that these goals represented an appropriate mix of goals that were believed to be achievable with consistent and focused effort along with stretch goals that would represent outstanding achievement. On each date that the plan administrator determined that one of the 2023 PSU Program goals had been achieved, the participant became entitled to a number of RSUs equal to the percentage attributed to the achieved goal multiplied by the participant’s target award amount, divided by the volume-weighted average trading price of the Company’s common stock over the 20 consecutive trading days ending on the date on which the goal was achieved (“VWAP”). RSU awards were not actually granted until subsequently approved by the Compensation Committee. Any RSU awards that were granted under the 2023 PSU Program in 2023 vested in four equal installments on January 16, 2024, February 12, 2024, March 11, 2024, and April 16, 2024, subject to the NEO’s continued employment with us through each such applicable vesting date. Our Compensation Committee established the target and maximum amounts for each NEO based on the individual’s role, a review of competitive market data, and the specific impact they were expected to have on achieving the Company-wide goals. Under the 2023 PSU Program, the Compensation Committee set the following target and maximum values for our NEOs:
Equity Awards
| Name | Target Amount | Maximum Amount | | JoeBen Bevirt | $558,000 | $930,000 | | Matthew Field | $468,000 | $780,000 | | Didier Papadopoulos | $624,000 | $1,040,000 | | Kate DeHoff | $252,000 | $420,000 | | Bonny Simi | $378,000 | $630,000 |
Equity Awards
In December 2023, our Compensation Committee exercised discretion related to the performance achievement level for two of the pre-established goals. Specifically, the Compensation Committee determined that the work completed by the Company in support of its demonstration flight in New York City on November 13, 2023 would count as one of the two agreements required to achieve the goal related to electrification of at least two sites in major markets because of the commitments made by Mayor Adams as part of the city’s request for proposal (“RFP”) for electrification of the downtown NY heliport had substantially achieved the aims of that goal as to one site. The Compensation Committee also granted 50% achievement of the goal related to the design and permitting of a vertiport since the design had been completed but the Company decided to defer submitting the permit request to a later date. Our Compensation Committee adjusted the goals in a manner intended to continue to both be challenging to achieve and to reward outstanding performance against our operational goals and objectives. The 2023 PSU Program resulted in approximately 62.50% of the target award opportunities being granted during the year, as follows:
Equity Awards
| Date of Achievement | Goal Achieved | Target Amount Awarded | Conversion Price for RSUs(1) | | 3/15/2023 | Certification Goal #1 | 3.33% | 4.33 | | 4/13/2023 | Certification Goal #2 | 3.33% | 4.03 | | 7/28/2023 | Certification Goal #3 | 10.00% | 9.61 | | 9/8/2023 | Certification Goal #4 | 1.67% | 7.31 | | 9/14/2023 | Deliver charging station for on-base operations | 1.67% | 7.17 | | 9/15/2023 | Inhabited Flight | 10.00% | 7.09 | | 9/15/2023 | Inhabited Flight by September 30, 2023 | 3.33% | 7.09 | | 9/22/2023 | Complete first flight of one on-base contract aircraft in Q3 | 1.67% | 6.94 | | 11/4/2023 | Commercialization Goal #1 | 1.67% | 5.99 | | 12/5/2023 | Manufacturing Goal #1 | 3.33% | 5.91 | | 12/6/2023 | Certification goal #5 | 1.67% | 5.93 | | 12/8/2023 | Commercialization Goal #2 | 3.33% | 6.01 | | 12/4/2023 | Commercialization Goal #3 | 1.67% | 5.9 | | 12/11/2023 | Certification Goal #6 | 3.33% | 6.06 | | 12/12/2023 | Vertiport designed and permitted | 0.83% | 6.12 | | 12/24/2023 | Certification Goal #7 | 6.67% | 6.59 | | 12/28/2023 | Signed definitive agreement to electrify at least two sites in major in-market location | 1.67% | 6.71 | | 12/29/2023 | Certification Goal #8 | 3.33% | 6.74 |
Equity Awards
(1) Conversion price is equal to the 20-day VWAP as described above. Each award of RSUs vested in four equal installments on January 16, 2024, February 12, 2024, March 11, 2024, and April 16, 2024.
Clawback Policy
Clawback Policy Effective October 2, 2023, our Board adopted a Policy for Recovery of Erroneously Awarded Compensation (the “Clawback Policy”) to implement the final clawback rules promulgated by the Securities and Exchange Commission (the “SEC”) and the New York Stock Exchange. The Clawback Policy applies to our current and former executive officers and subjects their incentive-based compensation received on or after October 2, 2023 to clawback in the event our company is required to prepare an accounting restatement to correct its material noncompliance with any financial reporting requirement under U.S. securities laws. In these circumstances, the Clawback Policy requires the Company to recover, reasonably promptly, the portion of incentive-based compensation that is deemed to have been erroneously awarded, unless the Compensation Committee (which administers the policy) determines that recovery would be impracticable and that one or more of the allowable impracticability conditions under SEC rules has been met. Recovery is required whether or not the applicable officer engaged in misconduct or otherwise caused or contributed to the requirement for the restatement. In addition to these requirements, the Clawback Policy continues to provide the Committee with broad discretion as to what actions may be taken based on circumstances leading to the restatement, including recovery of compensation under our PSU Program, RSUs, and other equity incentive awards. Each of our executive officers has agreed to the terms of the Clawback Policy and acknowledged that their compensation may be subject to reduction, cancellation, forfeiture and/or recoupment as required thereby.
Section 280G/Section 4999 Policy
Section 280G/Section 4999 Policy We do not provide any tax gross-ups to cover excise taxes under Section 4999 in connection with a change in control or otherwise.
Employment and Offer Letters
Employment and Offer Letters JoeBen Bevirt We have not entered into an employment agreement or employment offer letter with Mr. Bevirt. Matthew Field In February 2021, we entered into an employment offer letter with Mr. Field that sets forth the terms and conditions of his employment, including his initial annual base salary of $375,000 and new hire grant of 553,151 RSUs. This grant of RSUs was designed to compensate Mr. Field for a portion of the unvested equity and pension benefits that he forfeited with his previous employer. Mr. Field’s offer letter also included a $400,000 signing bonus, of which $200,000 was payable in connection with Mr. Field’s first day of employment (the “First Installment”) and the remaining $200,000 was paid in April 2022 (the “Second Installment”). The employment offer letter also entitled Mr. Field to a $100,000 relocation bonus, paid in December 2022 upon his relocation to a residence within 50 miles of his primary office (the “Relocation Bonus”), and reimbursement of up to $10,000 in travel expenses during his first year of employment for travel to and from his primary residence. We also entered into a Relocation Assistance Letter with Mr. Field in July 2022 pursuant to which we agreed to pay the Down Payment Assistance and the Geographic Differential Compensation as described above under “Relocation Packages.” Didier Papadopoulos In April 2021, we entered into an employment offer letter with Mr. Papadopoulos that sets forth the terms and conditions of his employment, including his initial annual base salary of $375,000 and a new hire grant of RSUs valued at $2,400,000 vesting over six years. Mr. Papadopoulos’ offer letter also included a $100,000 signing bonus, of which $50,000 was paid in connection with his first day of employment and the remainder was paid in April 2022, in connection with the one-year anniversary of his employment. We also entered into a Relocation Assistance Letter with Mr. Papadopoulos in July 2022 pursuant to which we agreed to pay the Down Payment Assistance and the Geographic Differential Compensation as described above under “Relocation Packages.” Bonny Simi In November 2020, we entered into an employment offer letter with Ms. Simi that set forth the terms and conditions of her employment, including her initial annual base salary of $350,000. Under the terms of her employment offer letter, Ms. Simi also received a stock option to purchase 1,512,522 shares of the Company’s common stock, vesting over six years. We also entered into a Relocation Assistance Letter with Ms. Simi in July 2022 pursuant to which we agreed to pay the Down Payment Assistance and the Geographic Differential Compensation as described above under “Relocation Packages.” Kate DeHoff In December 2020, we entered into an employment offer letter with Ms. DeHoff that sets forth the terms and conditions of her employment, including her initial annual base salary of $350,000 and an award of time-based stock options. In January 2021, Ms. DeHoff was awarded a new hire grant of 385,522 RSUs vesting over six years in lieu of the time-based option award provided for in her offer letter.
Termination and Change of Control Provisions
Termination and Change of Control Provisions None of our named executive officers is entitled to any potential payments or benefits in connection with a termination of their employment or a change in control of the Company, except that under our 2021 Incentive Award Plan if equity awards are not assumed or substituted in connection with a change in control, the vesting of such equity awards will fully accelerate, and if an NEO experiences a qualifying termination of employment within the period commencing three months prior to a change in control and ending 12 months after the change in control, the vesting of any equity awards that are assumed or substituted for will fully accelerate.
2023 Summary Compensation Table
2023 Summary Compensation Table The following table sets forth information concerning the compensation of our named executive officers for the year ended December 31, 2023.
2023 Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($)(1)(2) | All Other Compensation ($)(3) | Total ($) | | JoeBen Bevirt | 2023 | 619,616 | — | 3,471,919 | 4,000 | 4,095,534 | | Chief Executive Officer | 2022 | 592,308 | — | 8,016,335 | 4,000 | 8,612,643 | | | 2021 | 400,000 | — | — | 4,000 | 404,000 | | Matthew Field Chief Financial Officer | 2023 | 519,615 | — | 1,651,701 | 104,000 | 2,275,316 | | | 2022 | 495,192 | 300,000 | 2,277,688 | 61,934 | 3,134,814 | | | 2021 | 304,327 | 200,000 | 4,828,787 | 45,007 | 5,378,121 | | Didier Papadopoulos President of Aircraft OEM | 2023 | 519,615 | — | 2,063,257 | 254,000 | 2,836,872 | | | 2022 | 495,192 | 50,000 | 2,233,266 | 586,473 | 3,364,931 | | | 2021 | — | — | — | — | — | | Kate DeHoff General Counsel and Corporate Secretary | 2023 | 419,615 | — | 1,306,392 | 4,000 | 1,730,007 | | | 2022 | 398,077 | — | 1,927,688 | 4,000 | 2,329,765 | | | 2021 | — | — | — | — | — | | Bonny Simi President of Operations | 2023 | 419,615 | — | 1,490,446 | 104,000 | 2,014,061 | | | 2022 | 398,077 | — | 350,000 | 54,000 | 802,077 | | | 2021 | 350,000 | — | — | 4,000 | 354,000 |
2023 Summary Compensation Table
| (1) Amounts reported represent the aggregate grant date fair value of RSU awards granted to our NEOs during 2023 under our 2021 Plan and the 2023 PSU Program, computed in accordance with FASB ASC Topic 718. See the discussion of Critical Accounting Policies in the Management’s Discussion and Analysis our Annual Report on Form 10-K for the year ended December 31, 2023 for the assumptions used in calculating these values. The value for each award granted under the 2023 PSU Program that is reported in the table assumed a 63.33% probability of achievement at target. The grant date fair value of each award, assuming the maximum level of performance, is $930,000, $780,000, $1,040,000, $420,000 and $630,000 for Mr. Bevirt, Mr. Field, Mr. Papadopoulos, Ms. DeHoff and Ms. Simi, respectively. | | (2) The Stock Awards reported for 2022 have been revised to correct an error in the calculation of the value of RSU awards granted to our NEOs during 2022. The previously disclosed amounts overstated the value of Stock Awards granted to Mr. Bevirt, Mr. Field, Mr. Papadopoulos and Ms. DeHoff by $1,583,665, $422,310, $316,733 and $422,310, respectively. There is no change to the amount reported for Ms. Simi. |
2023 Summary Compensation Table
| (3) Amount reported for 2023 includes a $4,000 401(k) plan matching contribution for each of our NEOs and geographic differential compensation of $100,000, $250,000 and $100,000 for each of Mr. Field, Mr. Papadopoulos and Ms. Simi, respectively. Geographic differential compensation is more fully described above under “Relocation Packages” and “Employment and Offer Letters.” |
2023 Grants of Plan-Based Awards Table
2023 Grants of Plan-Based Awards Table The following table provides information about equity and non-equity awards granted to the NEOs in 2023.
2023 Grants of Plan-Based Awards Table
| | | | Estimated Future Payout Under Equity Incentive Plan Awards | | | All Other Stock Awards | | | Name | Grant Date | Award Type | Threshold (#/$) | Target (#/$) | Maximum (#/$) | Number of Shares of Stock (#) | Grant Date Fair Value of Stock Awards ($) | | JoeBen Bevirt | 6/30/2023 | RSU(1) | | 303,951 | | — | 3,118,537 | | | (2) | PSU(2) | $93,000 | $558,000 | $930,000 | — | 558,000 | | Matthew Field | 6/21/2023 | RSU(1) | — | 98,784 | — | — | 677,658 | | | 6/21/2023 | RSU(3) | — | — | — | 98,784 | 677,658 | | | (2) | PSU(2) | $78,000 | $468,000 | $780,000 | — | 468,000 | | Didier Papadopoulos | 6/21/2023 | RSU(1) | — | 121,580 | — | — | 834,039 | | | 6/21/2023 | RSU(3) | — | — | — | 121,580 | 834,039 | | | (2) | PSU(2) | $104,000 | $624,000 | $1,040,000 | — | 624,000 | | Kate DeHoff | 6/21/2023 | RSU(1) | — | 83,586 | — | — | 573,400 | | | 6/21/2023 | RSU(3) | — | — | — | 83,586 | 573,400 | | | (2) | PSU(2) | $42,000 | $252,000 | $420,000 | — | 252,000 | | Bonny Simi | 6/21/2023 | RSU(1) | — | 91,185 | — | — | 625,529 | | | 6/21/2023 | RSU(3) | — | — | — | 91,185 | 625,529 | | | (2) | PSU(2) | $63,000 | $378,000 | $630,000 | — | 378,000 | | (1) | Performance-based RSUs were granted under the 2021 Plan and vest on the third anniversary of the grant date provided that certain performance conditions related to certification are met on or before that date, subject to continued service. | | | | | | | | (2) | Dollar-denominated target and maximum amounts were established by the Board and Compensation Committee in February 2023 for the 2023 performance period. Restricted stock unit awards were granted under the 2023 PSU Program after achievement of goals established under the 2023 PSU Program. On each date that the plan administrator determined that any 2023 PSU Program goal had been met, the participant became entitled to a number of RSUs equal to the percentage attributable to the achieved goal multiplied by the participant’s target award amount, divided by the volume-weighted average trading price of the Company’s common stock over the 20 consecutive trading day immediately preceding the date on which the goal was achieved. The RSUs vested in four equal installments on each of January 16, 2024, February 12, 2024, March 11, 2024, and April 16, 2024, subject to the participant’s continued employment through the vesting date. | | | | | | | | (3) | Service-based RSUs were granted under the 2021 Plan and vest in equal quarterly installments over four years on the anniversary of July 1, 2023, subject to continued service. | | | | | | |
2023 Outstanding Equity Awards at Fiscal Year-End Table
2023 Outstanding Equity Awards at Fiscal Year-End Table The following table summarizes the number of outstanding equity awards held by our NEOs as of December 31, 2023.
2023 Outstanding Equity Awards at Fiscal Year-End Table
| | Option Awards | | | | Stock Awards | | | | | Name | Number of shares underlying unexercised options (#) exercisable | Number of shares underlying unexercised options (#) unexercisable | Option exercise price ($) | Option expiration date | Number of shares or units of stock that have not vested (#) | Market value of shares or units of stock that have not vested ($)(1) | Equity Incentive Plan Awards: Number of unearned shares or units of stock that have not vested (#) | Equity Incentive Plan Awards: Market value of unearned shares or units of stock that have not vested ($) | | JoeBen Bevirt | | | | | | | 303,951(2) | 2,021,274 | | | | | | | 448,207(3) | 2,980,577 | | | | | | | | | 42,649(4) | 283,616 | | | | Matthew Field | | | | | | | 98,784(2) | 656,914 | | | | | | | 322,698(5) | 2,145,942 | | | | | | | | | 119,522(6) | 794,821 | | | | | | | | | 92,610(7) | 615,857 | | | | | | | | | 35,766(4) | 237,844 | | | | Didier Papadopoulos | | | | | | | 121,580(2) | 808,507 | | | | | | | 162,979(8) | 1,083,810 | | | | | | | | | 89,641(6) | 596,113 | | | | | | | | | 113,982(7) | 757,980 | | | | | | | | | 47,693(4) | 317,158 | | | | Kate DeHoff | | | | | | | 83,586(2) | 555,847 | | | | | | | 208,842(9) | 1,388,799 | | | | | | | | | 119,522(6) | 794,821 | | | | | | | | | 78,362(7) | 521,107 | | | | | | | | | 19,257(4) | 128,059 | | | | Bonny Simi | 918,432(10) | 226,313(11) | $1.77 | 12/18/2030 | | | | | | | | | | | | | 91,185(2) | 606,380 | | | | | | | 85,486(7) | 568,482 | | | | | | | | | 28,887(4) | 192,099 | | |
2023 Outstanding Equity Awards at Fiscal Year-End Table
| (1) Amount reported based on value of $6.65 per share, which was the closing price of our common stock on December 29, 2023. | | (2) RSUs that vest on June 21, 2026, provided that certain performance conditions related to certification are met on or before that date, subject to continued service. | | (3) RSUs that vest in equal quarterly installments through January 1, 2026, subject to continued service. | | (4) RSUs granted upon achievement of goals under the 2023 PSU Program that vest in in four equal installments on each of January 16, 2024, February 12, 2024, March 11, 2024, and April 16, 2024, subject to continued service. | | (5) RSUs that vest in equal quarterly installments through April 3, 2027, subject to continued service. | | (6) RSUs that vest in equal quarterly installments through January 1, 2026, subject to continued service. | | (7) RSUs that vest in equal quarterly installments through July 1, 2027, subject to continued service. | | (8) RSUs that vest in equal quarterly installments through June 14, 2027, subject to continued service. | | (9) RSUs that vest in equal quarterly installments through January 12, 2027, subject to continued service. |
2023 Outstanding Equity Awards at Fiscal Year-End Table
| (10) Option for which 529,940 shares were vested as of December 31, 2023. The remaining shares subject to the option vest in equal quarterly installments through December 15, 2026, subject to continued service. | | (11) Option that vests in equal quarterly installments through December 15, 2026, subject to continued service. |
2023 Options Exercised and Stock Vested Table
2023 Options Exercised and Stock Vested Table The following table summarizes the value realized by our NEOs due to the vesting of RSU awards and the exercise of stock options during 2023.
2023 Options Exercised and Stock Vested Table
| | | Option Awards | | Stock Awards | | | Name | | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($)(1) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($)(2) | | JoeBen Bevirt | | — | — | 520,002 | 2,289,817 | | Matthew Field | | — | — | 255,105 | 1,262,538 | | Didier Papadopoulos | | — | — | 239,464 | 1,079,438 | | Kate DeHoff | | — | — | 181,049 | 952,411 | | Bonny Simi | | 113,246 | 447,322 | 50,864 | 188,061 | | (1) | Represent the excess of the closing price of our common stock on the date of exercise over the exercise price of the underlying option, multiplied by the number of options exercised. | | | | | | (2) | Represents the amount realized based on the product of the number of RSUs vested multiplied by the closing price of our common stock on the applicable vesting date. | | | | |
Quantification of Potential Payments upon Termination or Change in Control
Quantification of Potential Payments upon Termination or Change in Control The table below reflects the intrinsic value of unvested equity awards that would have been accelerated had (i) a change in control occurred on December 31, 2023 and the outstanding equity awards were not assumed or substituted and/or (ii) a NEO’s employment with the Company been terminated as of December 31, 2023 and such termination occurred within the period commencing 3 months prior to a change in control and ending 12 months after the change in control. The numbers below are based on our closing stock price of $6.65 on December 31, 2023.
Quantification of Potential Payments upon Termination or Change in Control
| Name | Value of Benefit ($) | | JoeBen Bevirt | 5,285,467 | | Matthew Field | 2,305,435 | | Didier Papadopoulos | 2,479,758 | | Kate DeHoff | 1,999,835 | | Bonny Simi | 1,366,961 |
CEO Pay Ratio
CEO Pay Ratio As required by Item 402(u) of Regulation S-K, we are disclosing the following information about the relationship of the median of the annual total compensation of all our employees (other than our CEO), and the annual total compensation of our Chief Executive Officer, Mr. Bevirt (our “CEO”), for 2023. CEO Pay Ratio for 2023 •The median of the annual total compensation of all our employees, excluding our CEO, was $171,598; •The annual total compensation of our CEO, as reported in the 2023 Summary Compensation Table included in this Proxy Statement, was $4,095,534; and •The ratio of the annual total compensation of our CEO to the median of the annual total compensation of all our employees was 24 to 1. We believe this ratio is a reasonable estimate calculated in a manner consistent with SEC rules. Methodology The methodology and the material assumptions, adjustments, and estimates used to identify the median of the annual total compensation of all our employees for 2023 were based on the following: •Our median employee was identified from all full-time, part-time, seasonal, and temporary employees as of December 31, 2023, the last day of our fiscal year (other than our CEO). As of December 31, 2023, we and our consolidated subsidiaries employed approximately 1,748 individuals. Our employee population consisted of individuals (other than our CEO) working at our parent company and consolidated subsidiaries both within and outside the United States. We did not include any contractors or other non-employee workers in our employee population. •To identify our median employee from our employee population, we calculated the aggregate amount of each employee’s (i) base salary or gross wages paid and (ii) the value of target annual bonus, which compensation measure was consistently applied. For simplicity and consistency across our organization, we used annual base salary or gross wages rate or the actual amount paid. Amounts under item (ii) above were annualized for any permanent employees who commenced work during 2023. We selected the foregoing compensation elements because they represented our principal broad-based compensation elements. •We did not rely on the data privacy or de minimis exceptions allowed by SEC rules to exclude any non-U.S. employees from our employee population, nor did we make any cost-of-living adjustment. •Compensation not paid in U.S. dollars was converted to U.S. dollars using the foreign exchange rates in effect as of December 31, 2023. •All employees except for our CEO were ranked from lowest to highest with the median employee determined from this list. Using this approach, we identified the individual at the median of our employee population who was the best representative of our employee population. The individual was a full-time employee based in the United States. Calculation Having identified our median employee using the aforementioned methodology, we then calculated the annual total of this employee for 2023 annual total compensation using the same methodology that we use for determining the annual total compensation of our named executive officers as reported in our 2023 Summary Compensation Table above. We determined our CEO’s annual total compensation for fiscal 2023 as reported in our 2023 Summary Compensation Table above. The SEC rules allow companies to adopt a variety of methodologies, apply certain exclusions, and make reasonable estimates and assumptions that reflect their employee population and compensation practices, therefore the pay ratio reported by other companies may not be comparable to our pay ratio. As explained by the SEC when it adopted these rules, the rule was not designed to facilitate comparisons of pay ratios among different companies, even companies within the same industry, but rather to allow stockholders to better understand and assess each particular company’s compensation practices and pay ratio disclosures.
Pay Versus Performance Table
Pay Versus Performance Table
Pay Versus Performance Table
| Year | Summary Comp. Table Total for CEO | Compensation Actually Paid to CEO | Average Summary Comp. Table Total for Non-CEO NEOs(1) | Average Compensation Actually Paid to Non-CEO NEOs | Value of Initial Fixed $100 Investment Based On: | | Net Income | Company Selected Measure | | | | | | | TSR | Peer Group TSR(2) | | | | 2023 | 4,095,534 | 4,955,399 | 2,214,064 | 3,924,250 | 66.30 | 46.32 | (513,050) | n/a | | 2022 | 8,612,643 | 5,403,553 | 2,407,897 | (437,128) | 33.40 | 31.78 | (258,043) | n/a | | 2021 | 404,000 | 404,000 | 8,212,877 | 7,177,713 | 72.78 | 69.08 | (180,324) | n/a |
Pay Versus Performance Table
(1)Amounts represent compensation actually paid to our Principal Executive Officer (PEO) and the average compensation actually paid to our remaining NEOs for the relevant fiscal year, as determined under SEC rules (and described below), which includes the individuals indicated in the table below for each fiscal year:
Pay Versus Performance Table
| Year | PEO | Non-PEO NEOs | | 2023 | JoeBen Bevirt | Matthew Field, Didier Papadopoulos, Kate DeHoff and Bonny Simi | | 2022 | JoeBen Bevirt | Matthew Field, Didier Papadopoulos, Kate DeHoff and Bonny Simi | | 2021 | JoeBen Bevirt | Matthew Field and Eric Allison |
Pay Versus Performance Table
Compensation actually paid to our NEOs represents the “Total” compensation reported in the Summary Compensation Table for the applicable fiscal year, as adjusted as follows:
Pay Versus Performance Table
| | 2021 | | 2022 | | 2023 | | | Adjustments | PEO | Average Non-PEO NEOs | PEO | Average Non-PEO NEOs | PEO | Average Non-PEO NEOs | | Deduction for Amounts Reported under the “Stock Awards” and “Option Awards” Columns in the Summary Compensation Table for Applicable FY | — | (7,744,671) | (8,016,335) | (1,697,161) | (3,471,919) | (1,627,949) | | Increase based on ASC 718 Fair Value of Awards Granted during Applicable FY that Remain Unvested as of Applicable FY End, determined as of Applicable FY End | — | 6,709,507 | 3,243,500 | 692,987 | 2,304,890 | 1,491,558 | | Increase/deduction for Awards Granted during Prior FY that were Outstanding and Unvested as of Applicable FY End, determined based on change in ASC 718 Fair Value from Prior FY End to Applicable FY End | — | — | — | (1,834,777) | 1,479,083 | 1,397,679 | | Increase based on ASC 718 Fair Value of Awards Granted during Applicable FY that Vested during Applicable FY, determined as of Vesting Date | — | — | 1,563,745 | 286,686 | — | 39,821 | | Increase/deduction for Awards Granted during Prior FY that Vested During Applicable FY, determined based on change in ASC 718 Fair Value from Prior FY End to Vesting Date | — | — | — | (292,760) | 547,810 | 409,076 | | TOTAL ADJUSTMENTS | — | (1,035,164) | (3,209,090) | (2,845,025) | 859,864 | 1,710,186 |
Pay Versus Performance Table
(2)For the relevant fiscal year, represents the cumulative TSR (the “Peer Group TSR”) of a peer group consisting of Archer Aviation Inc., Eve Holding, Inc., Joby Aviation, Inc., Lilium N.V., Vertical Aerospace Ltd. (“Peer Group”), as used in the Stock Performance Graph disclosed under Item 5 of our Annual Report on Form 10-K for the year ended December 31, 2023. The amount reflected shows the annual change in value of $100 invested in the Peer Group on August 10, 2021, the date of our Merger with RTP, and assumes reinvestment of dividends, if any. Each of the companies in our Peer Group went public via merger with a special purpose acquisition company (“SPAC”). For Peer Group companies that completed their SPAC merger after August 10, 2021, the cumulative return for the Peer Group was weighted based on the market capitalization of each company based on the date of its SPAC merger. (3)Fair value or change in fair value, as applicable, of equity awards in the “Compensation Actually Paid” columns was determined by reference to (i) for solely service-vesting RSU awards, the closing price per share on the applicable year-end date(s) or, in the case of vesting dates, the closing price per share on the applicable vesting date(s); (ii) for performance-based RSU awards, the same valuation methodology as RSU awards above except that the year-end values are multiplied by the probability of achievement of the applicable performance objective as of the applicable date; and (iii) for stock options, a Black Scholes value as of the applicable year-end or vesting date(s), determined based on the same methodology as used to determine grant date fair value but using the closing stock price on the applicable revaluation date as the current market price and with an expected life set equal to the remaining life of the award in the case of underwater stock options and, in the case of in the money options, an expected life equal to the original ratio of expected life relative to the ten year contractual life multiplied times the remaining life as of the applicable revaluation date, and in all cases based on volatility and risk free rates determined as of the revaluation date based on the expected life period and based on an expected dividend rate of 0%. For additional information on the assumptions used to calculate the valuation of the awards, see the Notes to Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023