DEF 14A 1 strc-def14a_20220629.htm DEF 14A strc-def14a_20220629.htm

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

 

 

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934

Filed by the Registrant

Filed by a party other than the Registrant  

Check the appropriate box:

Preliminary Proxy Statement

Confidential, for Use of the Commission Only (as permitted by Rule 14a‑6(e)(2))

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material Pursuant to §240.14a‑12

SARCOS TECHNOLOGY AND ROBOTICS CORPORATION

 

 

(Name of Registrant as Specified In Its Charter)

 

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

No fee required.

Fee paid previously with preliminary materials.

Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

 

 

 


 

 

 

 

 

 


 

 

 

 

 

Fellow Shareholders,

I joined Sarcos because I truly believe in our mission: to increase worker productivity and longevity and prevent injuries through robots. Every day we design products that do exactly that. Our work will fundamentally improve the lives of workers worldwide. Our products will transform industries by increasing worker safety, longevity and productivity.

Going public in September 2021 provided the funding we need to transition from a research and development team to a product company. Our people are the foundation of our strategic competitive advantage. With the acquisition of RE2, Sarcos has over fifty years of advanced engineering that has pioneered the robotics industry through research, product design, and intellectual property. We are leveraging this strong foundation, and the advancements and cost reduction of essential technologies, to build and deliver commercially viable highly dexterous robots. These robotic systems partner with humans to perform challenging tasks in unstructured environments. What does that really mean?  Imagine a day when a skilled robot operator can safely perform tasks, regardless of physical stature or stamina, with a fleet of robots. That day will be here with the deployments of the Guardian and Sapien products.

We have the talent. We continue to build a strong culture. A culture committed to delighting customers. A culture that values diverse perspectives with empathy and embraces change. To delight customers, we must remain

diligent on delivering products on time. Our newly expanded roadmap now includes six highly dexterous robots, that can work in operating rooms, underwater, at height, in a port or on a factory floor.  The diversification of the portfolio will be unified through our continued investment in advanced artificial intelligence that will enable task-based autonomy.

I am delighted to be on this journey with such a talented team and look forward to launching this new product category.  On behalf of our distinguished Board of Directors and the entire Sarcos team, I invite you to our Annual Shareholder meeting on June 29, 2022, at 2:00 Mountain Time.

Together we will deliver the workforce of tomorrow – one robot at a time.

Best Regards,

Kiva Allgood

President and Chief Executive officer


 


 

 

 

 

SARCOS TECHNOLOGY AND ROBOTICS CORPORATION

650 South 500 West, Suite 150, Salt Lake City, Utah 84101 Tel: 888-927-7296

May 13, 2022

Dear Fellow Stockholders:

We are pleased to invite you to attend the annual meeting of stockholders of Sarcos Technology and Robotics Corporation, to be held on Wednesday, June 29, 2022 at 2:00 p.m., Mountain Time, at our offices located at 650 South 500 West, Suite 150, Salt Lake City, Utah 84101.

The attached formal meeting notice and proxy statement contain details of the business to be conducted at the annual meeting, as well as information about Sarcos.

Your vote is important. Whether or not you attend the annual meeting, it is important that your shares be represented and voted at the annual meeting. Therefore, we urge you to vote and submit your proxy promptly via the Internet, telephone or mail.

On behalf of our Board of Directors, we would like to express our appreciation for your continued support of and interest in Sarcos.

Sincerely,

Benjamin G. Wolff

Executive Chairman of the Board

 

 

IMPORTANT

 

A proxy card is being provided along with this notice of the annual meeting and proxy statement. We urge you to complete and mail the card promptly. Alternatively, you may vote by calling the toll-free telephone number or by going online as described in the instructions included with your proxy card. Any stockholder attending the annual meeting may vote on all matters that are considered, in which case the signed and mailed proxy or prior vote by telephone or online will be revoked. Please note, however, that if your shares are held of record by a broker, bank or other nominee and you wish to vote in person at the annual meeting, you must obtain from the record holder a proxy issued in your name.

 

IT IS IMPORTANT THAT YOU VOTE YOUR STOCK

 

 

 


 

 

 

 

SARCOS TECHNOLOGY AND ROBOTICS CORPORATION

650 South 500 West, Suite 150, Salt Lake City, Utah 84101

May 13, 2022

Notice of 2022 Annual Meeting of Stockholders

 

Date and Time of Meeting

 

Wednesday, June 29, 2022

2:00 p.m. Mountain Time

 

Place

 

The 2022 annual meeting of stockholders will be held at our offices located at 650 South 500 West, Suite 150, Salt Lake City, Utah 84101.

 

Items of Business

To elect three Class I directors to hold office until our 2025 annual meeting of stockholders and until their respective successors are elected and qualified.

To ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for our fiscal year ending December 31, 2022.

To transact other business that may properly come before the annual meeting or any adjournments or postponements thereof.

 

Record Date

 

May 6, 2022. Only stockholders of record as of May 6, 2022 are entitled to notice of and to vote at the annual meeting.

 

Availability of Proxy Materials

 

The Notice of Internet Availability of Proxy Materials, containing instructions on how to access our proxy statement, notice of annual meeting, form of proxy and our annual report, is first being sent or given on or about May 13, 2022 to all stockholders entitled to vote at the annual meeting.

 

The proxy materials and our annual report can be accessed as of May 13, 2022 by visiting www.proxydocs.com/STRC.

 

Voting

 

Your vote is important. Whether or not you plan to attend the annual meeting, we urge you to submit your proxy or voting instructions via the Internet, telephone or mail as soon as possible.

 

By order of the Board of Directors,

Julie Wolff

Corporate Secretary

 

 


 

 

TABLE OF CONTENTS

 

 

Page

 

 

Proxy Summary and Company Highlights

1

Board of Directors and Corporate Governance

5

Composition of the Board

5

Nominees for Director

8

Continuing Directors

11

Director Independence

16

Board Leadership Structure

16

Role of Board in Risk Oversight Process

17

Board Committees

18

Attendance at Board, Board Committee and Stockholder Meetings

21

Executive Sessions of Non-Employee and Independent Directors

21

Compensation Committee Interlocks and Insider Participation

21

Considerations in Evaluating Director Nominees

22

Stockholder Recommendations and Nominations to our Board of Directors

22

Communications with the Board of Directors

23

Policy Prohibiting Hedging or Pledging of Securities

23

Corporate Governance Guidelines and Code of Business Conduct and Ethics

24

Other Corporate Governance Policies and Practices

24

Sustainability

25

Director Compensation

27

Proposal No. 1: Election of Class I Directors

30

Proposal No. 2: Ratification of Appointment of Independent Registered Public Accounting Firm

31

Report of The Audit Committee

34

Executive Officers

36

Executive Compensation

39

Security Ownership of Certain Beneficial Owners and Management

48

Related Person Transactions

51

Certain Relationships and Related Person Transactions

51

Policies and Procedures for Related Person Transactions

58

Other Matters

60

Questions and Answers About the Proxy Materials and Our Annual Meeting

62

Form of Proxy Card

 

 

 

 

 

 

    2022 PROXY STATEMENT | i

 

 

 


 

 

 

 

SARCOS TECHNOLOGY AND ROBOTICS CORPORATION

PROXY STATEMENT

FOR 2022 ANNUAL MEETING OF STOCKHOLDERS
To be held at 2:00 p.m., Mountain Time, on Wednesday, June 29, 2022

PROXY SUMMARY AND
COMPANY HIGHLIGHTS

 

About Sarcos Technology and Robotics Corporation

 

Our mission is to save lives and prevent injury while helping humans accomplish more than ever before. To achieve our mission, we design our robotic systems to augment human performance by combining human intelligence, instinct and judgment with the strength, endurance and precision of machines to create the most safe, productive and cost-effective workforce in the world. We are a leader in the development of industrial highly-dexterous mobile robotic systems for use in dynamic environments. We expect our products to benefit industries in which people perform physically demanding or hazardous tasks, such as aerospace, automotive, aviation, construction, defense, distribution and warehousing for ecommerce and other industries, industrial manufacturing, maritime, military and oil and gas. Our technologically-advanced line of products augments, rather than replaces, humans.

We are the result of a decades-long effort in research and development of highly-dexterous robotic systems. Our original predecessor was spun-out of the University of Utah in 1983. In 2007, our predecessor was acquired by Raytheon and was operated until 2014 as a division of Raytheon known as Raytheon Sarcos. During this period, Raytheon Sarcos was focused primarily on developing cutting-edge technologies for use by U.S. governmental agencies. In December 2014, the assets of Raytheon Sarcos were acquired by a consortium led by the former Raytheon Sarcos President and our current Chief Innovation Officer Dr. Fraser Smith and technology and telecom entrepreneur Benjamin Wolff, our former Chief Executive Officer and current Executive Chairman of the Board. This acquisition was the basis for the establishment of Sarcos Corp., or Old Sarcos, which was incorporated in Utah in February 2015. On September 24, 2021, Old Sarcos combined with a subsidiary of Rotor Acquisition Corp., or Rotor, whereby Old Sarcos became a wholly-owned subsidiary of Rotor and Rotor changed its name to Sarcos Technology and Robotics Corporation (the Business Combination). In April 2022, we acquired RE2, Inc., a Pittsburgh, Pennsylvania based developer of the Sapien line of robotic arms and related software to enable intelligent mobile manipulation systems that operate in a variety of complex indoor and outdoor environments.

 

    2022 PROXY STATEMENT | 1

 

 

 


PROXY SUMMARY AND COMPANY HIGHLIGHTS

 

Products

Our products include the Guardian XO, the Guardian XT and the Sapien line of robotic arms. We continue to focus on finishing development and commencing initial production of commercial units of our core products, the Guardian XO and Guardian XT.

 

 

 

 

Guardian® XO®

Guardian® XT

SapienTM 6M

 

 

COVID-19

The COVID-19 pandemic continues to have a significant effect on the world, and we are not immune to its impact. Our product development efforts have been delayed during the pandemic. Due in part to the global impact, we have experienced, and continue to experience in varying degrees, difficulties or delays obtaining components, scheduling customer demos and testing and hiring needed personnel. However, we continue to make progress with our product development efforts, customer engagements, managing our supply chain, addressing hiring and managing other pandemic-related matters, such as employee health and safety, remote working arrangements and IT security and changing or different government health requirements and recommendations for work environments.

 

    2022 PROXY STATEMENT | 2

 

 

 


PROXY SUMMARY AND COMPANY HIGHLIGHTS

 

A Time of Change

We experienced transformational challenges in 2021 and 2022, which significantly improved and expanded our business. Not only did we conclude the Business Combination whereby we became a publicly-traded company, but we also acquired RE2 and had a number of leadership changes. With the Business Combination we brought on a new Board of Directors, which includes current and former leaders from Apple, The Boeing Company, Credit Suisse, Delta Air Lines, Microsoft, Nextel and the U.S. Department of Defense. In December 2021, Benjamin G. Wolff, Sarcos’ Chief Executive Officer since September 2021 and Old Sarcos’ Chief Executive Officer since 2015 assumed the role of Executive Chairman and Kiva Allgood joined us as President and Chief Executive Officer. With the acquisition of RE2, RE2’s founder and long-time Chief Executive Officer, Jorgen Pedersen, became our Chief Operating Officer. We are now actively engaged in the integration of Sarcos and RE2 and look forward to what the future holds.

Our Board

 

Committee Memberships

Current Directors

Age

(as of

3-29-22)

Director

Since

Independent

Audit

Compensation

Nominating

and

Corporate

Governance

Strategic

Transaction

Other Public

Directorships

Kiva Allgood

49

2021

 

 

 

 

 

2(4)

Priya Balasubramaniam

47

2021

 

 

 

--

Brian D. Finn

61

2021

 

 

1

Peter Klein(1)

59

2021

 

 

3

Matthew Shigenobu Muta

52

2021

 

 

 

--

Eric T. Olson

70

2021

 

 

2

Laura J. Peterson

62

2021

 

 

1

Dennis Weibling(2)

70

2021

 

 

2

Benjamin G. Wolff(3)

53

2021

 

 

 

 

1

 

   = Member     = Chair   = Audit Committee Financial Expert

 

 

(1)

Mr. Klein served on Old Sarcos’ board of directors from September 2016 until the Business Combination in September 2021.

 

(2)

Mr. Weibling served on Old Sarcos’ board of directors from September 2016 until the Business Combination in September 2021.

 

(3)

Mr. Wolff served on Old Sarcos’ board of directors from February 2015 until the Business Combination in September 2021.

 

(4)

Ms. Allgood is retiring from one of her outside board memberships in October 2022 when her current term on that board expires.

 

 

 

    2022 PROXY STATEMENT | 3

 

 

 


PROXY SUMMARY AND COMPANY HIGHLIGHTS

 

 

The Annual Meeting

 

All stockholders are cordially invited to attend the 2022 annual meeting of the stockholders of Sarcos Technology and Robotics Corporation (the “Annual Meeting”) to be held on June 29, 2022. Whether or not you expect to attend the Annual Meeting, please complete, date, sign and return the enclosed proxy card (or vote by telephone or the Internet) as promptly as possible to ensure your shares are voted at the Annual Meeting. Please note that if your shares are held of record by a broker, bank or other nominee and you wish to vote at the meeting, you must obtain from the record holder a proxy issued in your name. For more information about attending the Annual Meeting and voting procedures for you to vote your shares, please see “Questions and Answers about the Proxy Materials and Our Annual Meeting” beginning on page 62 of this proxy statement.

 

The following matters will be voted on at the Annual Meeting and are described in more detail in this proxy statement:

 

Proposal

Board Vote Recommendation

More Information

Election of Directors (Proposal 1)

The Board of Directors recommends that you vote FOR each of the nominees.

Page 30

Ratification of the Independent Registered Public Accounting Firm (Proposal 2)

The Board of Directors recommends that you vote FOR ratification of Ernst & Young LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2022.

Page 31

 

As of the date of this proxy statement, the Board of Directors knows of no other matters that will be brought before the Annual Meeting. However, if any other matters are properly brought before the Annual Meeting, the proxy holders will vote any shares for which they have been granted a proxy as they determine.

 

 

    2022 PROXY STATEMENT | 4

 

 

 


 

 

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

Composition of the Board

Our Board of Directors currently consists of nine directors, seven of whom are independent under the listing standards of The Nasdaq Stock Market LLC, or Nasdaq. Our Board of Directors is divided into three classes with staggered three-year terms. Thus, at each annual meeting of stockholders, a class of directors will be elected for a three-year term to succeed the class whose term is then expiring.

The following table sets forth the names, ages as of May 1, 2022 , and certain other information for each of our directors and director nominees:

 

Name

Class

Age

Position(s)

Director Since

Current Term

Expires

Expiration of

Term for

Which

Nominated

Nominees for Director

 

 

 

 

 

 

Kiva Allgood

I

49

Director, President and Chief Executive Officer

2021

2022

2025

Eric T. Olson

I

70

Director

2021

2022

2025

Benjamin G. Wolff

I

53

Director and Executive Chairman

2021

2022

2025

 

 

 

 

 

 

 

Continuing Directors

 

 

 

 

 

 

Matthew Shigenobu Muta

II

53

Director

2021

2023

Laura J. Peterson

II

62

Director

2021

2023

Dennis Weibling

II

71

Director

2021

2023

Priya Balasubramaniam

III

47

Director

2021

2024

Brian D. Finn

III

61

Director

2021

2024

Peter Klein

III

59

Director

2021

2024

 

 

Director Qualifications

We believe that our directors should possess high personal and professional ethics and integrity and be committed to representing the long-term interests of our stockholders. We endeavor to have a Board representing a range of experiences at policy-making levels in business and areas that are relevant to our business and long-term strategy. We believe that, in light of the current stage of our business, the following are key areas of experience, qualifications and skills that should be represented on the Board:

 

 

Leadership. We believe that directors with experience in significant leadership positions over an extended period provide us and the Board with important insights. Among other things, we believe that these individuals generally possess extraordinary leadership qualities and the ability to identify and develop those qualities in others and that they demonstrate a practical understanding of organizations, processes, strategy and growth management.

 

 

 

    2022 PROXY STATEMENT | 5

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

 

 

 

 

Technology. Our products involve highly sophisticated technology, are extremely complicated and reflect our efforts at solving very difficult technological problems. As a result, we believe it is important to have directors who have technology industry experience and an understanding of the difficulties in developing and commercializing technologically advanced products.

 

 

 

 

Operations. As we transition from primarily a research and development organization to a commercial enterprise, we need to continue to mature our operations to support the manufacture, service and support of products in commercial quantities. We benefit from the counsel and insight directors with significant operations experience provide.

 

 

 

 

Finance. As a newly public company, we benefit from directors with a strong finance background, including an understanding of finance, financial statements and financial reporting as we continue to strengthen our internal controls and related processes. Further, we believe it is important to have directors with significant financial market experience.

 

 

 

 

Customers. As we continue toward commercialization of our core products, the Guardian XO and Guardian XT, and to develop and offer our Sapien line of products, we believe it is important to have directors with experience in our target industries so that we can better understand the perspectives, needs and decision-making processes of potential customers.

 

 

 

 

Global Business. We believe that our business will involve sales outside of the United States. As a result, we believe it is important to have directors with significant international business or similar experience.

 

The following skills matrix sets forth the primary areas of experience, qualifications and skills that we have specifically identified as pertaining to each director, including our director nominees. This matrix should not be read as suggesting that directors not specifically identified with any particular area of experience, qualification or skill do not have experience, qualifications or skills in that area. Our Nominating and Corporate Governance Committee reviews at least annually the composition of the Board and considers whether additional or different skills are needed. We expect this process to continue as our business evolves and, as a result, our skills matrix may change over time.

 

 

 

 

Leadership

 

 

Technology

 

 

Operations

 

 

Finance

 

 

Customers

 

 

Global

Business

Kiva Allgood

 

 

Priya Balasubramaniam

 

Brian D. Finn

 

 

 

Peter Klein

 

 

Matthew Shigenobu Muta

 

 

Eric T. Olson

 

 

Laura J. Peterson

 

 

Dennis Weibling

 

 

 

Benjamin G. Wolff

 

 

 

    2022 PROXY STATEMENT | 6

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

 

We also believe that the significant stock ownership of (or of entities affiliated with) Mr. Wolff and Mr. Finn provide a strong alignment of interests between the Board and our stockholders and help ensure that the Board is properly focused on the long-term interests of our stockholders.

 

Board Diversity

We believe that we and our Board benefit from diversity with respect to professional background, education, race, ethnicity, gender, age and geography, as well as other individual qualities and attributes that contribute to the total mix of viewpoints and experience represented on our Board. Although our Board of Directors does not maintain a specific policy with respect to Board diversity, our Board of Directors believes that the Board should be a diverse body, and the Nominating and Corporate Governance Committee considers a broad range of perspectives, backgrounds and experiences when considering whether to recommend the nomination of any particular director candidate.

Board Diversity Matrix

 

Board Diversity Matrix (as of May 13, 2022)

Total Number of Directors: 9

 

 

Female

Male

Gender:

3

6

Demographic Background:

 

 

African American or Black

0

0

Asian

1

1

Hispanic or Latinx

0

0

Native Hawaiian or Pacific Islander

0

1

White

2

6

Two or More Races or Ethnicities

0

1

Additional Demographic Information:

 

 

Military Veteran

0

1

 

 

 

 

    2022 PROXY STATEMENT | 7

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

 

Nominees for Director

 

 

 

 

Kiva Allgood

 

 

 

 

 

Qualifications, Skills and Experience

 

   

 

 

 

Kiva Allgood has served as our President, Chief Executive Officer and a member of the Board of Directors since December 13, 2021. Prior to joining us, Ms. Allgood most recently served as the Global Head of IOT and Automotive for Telefonaktiebolaget LM Ericsson, a Nasdaq-listed company that is a global provider of communications technology, from April 2019 to July 2021. Ms. Allgood served as the Chief Commercial Development Officer for GE Ventures, a Corporate Venture Company from August 2017 to April 2019, and as Managing Director for Innovation Group of GE Corporate from November 2016 to August 2017. From June 2012 to November 2016, Ms. Allgood served as President, Qualcomm Intelligent Solutions, IoT and Smart Cities, at Qualcomm Incorporated, a Nasdaq-listed company that is a global provider of foundational technologies and products used in mobile devices and other wireless products. Earlier in her career, Ms. Allgood served in senior-level operational roles including sales, marketing and business development in the technology industry. Ms. Allgood will serve on the board of directors of Synaptics Incorporated until October 2022. Ms. Allgood also currently serves on the board of directors of Airgain, Inc. Ms. Allgood holds a Bachelor of Science degree and Master of Business Administration degree, both from Northwestern University. We believe Ms. Allgood’s leadership and familiarity with our business as our Chief Executive Officer, in addition to her experience in technology and management roles in her prior positions, qualify her to serve on our Board.

Committee

Memberships:

None

Other Current

Public

Directorships:

Synaptics

Airgain

 

 

 

 

 

 

Leadership

 

Technology

 

Operations

 

Finance

 

Customers

 

Global

Business

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    2022 PROXY STATEMENT | 8

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

 

 

 

 

 

Admiral Eric T. Olson (Ret.)

 

 

 

 

 

Qualifications, Skills and Experience

 

   

 

 

 

Admiral Eric T. Olson (Ret.) has served as a member of the Board of Directors since September 24, 2021. He has been President and Managing Member of ETO Group, LLC since September 2011, where he acts as an independent national security consultant supporting a wide range of private and public sector organizations. From June 2019 to May 2020, Admiral Olson served as Chief Executive Officer of Hans Premium Water, a privately held company. Admiral Olson retired from the United States Navy in 2011 as a full Admiral after 38 years of military service. He served in special operations units throughout his career, during which he was awarded several decorations for leadership and valor, including the Defense Distinguished Service Medal and the Silver Star. Admiral Olson was the first Navy SEAL officer to be promoted to three- and four-star ranks. Admiral Olson’s career culminated as the head of the United States Special Operations Command from July 2007 to August 2011, where he was responsible for the mission readiness of all Army, Navy, Air Force and Marine Corps special operations forces. Admiral Olson serves on the board of directors of Under Armour, Inc. (NYSE:UAA) and is a member of its nominating and corporate governance committee. Admiral Olson also serves on the board of directors of Iridium Communications Inc. (Nasdaq:IRDM) and is a member of its nominating and corporate governance committee. He also serves on the board of directors of Cyber Reliant Corporation, Newlight Technologies, Ocean Aero, Inc. and IP3. Admiral Olson has served as a director of the non-profit Special Operations Warrior Foundation. Admiral Olson has also served on the Old Sarcos Advisory Board since December 2016. Admiral Olson graduated from the United States Naval Academy in 1973 and earned a Master of Arts degree in National Security Affairs at the Naval Postgraduate School. He is an Adjunct Professor in the School of International and Public Affairs at Columbia University. We believe Admiral Olson’s leadership experience as an Admiral in the U.S. Navy, including his leadership and management of a large and complex organization as head of the U.S. Special Operations Command, in addition to his experience as a director of various companies and his expertise with respect to the needs of the U.S. military, qualifies him to serve on our Board of Directors.

Independent

Committee Memberships:

Audit

Compensation

Other Current

Public

Directorships:

Under Armour

Iridium Communications

 

 

 

 

 

 

Leadership

 

Technology

 

Operations

 

Finance

 

Customers

 

Global

Business

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    2022 PROXY STATEMENT | 9

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

 

 

 

 

 

Benjamin G. Wolff

 

 

 

 

 

Qualifications, Skills and Experience

 

    

 

 

 

Benjamin G. Wolff has served as our Executive Chairman since December 13, 2021, and as a member (and Chairman) of the Board of Directors since September 24, 2021. Mr. Wolff served as Old Sarcos’ Chief Executive Officer and Chairman of the Board of Directors from September 2015, its President from December 2020, and as a member of its Board of Directors from February 2015, in each case until the Business Combination, at which time he became our Chief Executive Officer, President and Chairman of our Board of Directors (until December 13, 2021, when he became our Executive Chairman). Prior to joining Old Sarcos, Mr. Wolff served as Chief Executive Officer, President and Chairman at Pendrell Corporation from December 2009 to November 2014. In April 2004, Mr. Wolff co-founded Clearwire Corporation, where he served as President and Chief Executive Officer until March 2009 and Co-Chairman until October 2011. Mr. Wolff has also served as President of Eagle River Investments, an investment fund focused on telecom and technology investments. Mr. Wolff previously served on the board of the Cellular Telecommunications Industry Association (CTIA), and is currently a member of the Board of Visitors of Northwestern School of Law at Lewis & Clark College in Portland, Oregon. Mr. Wolff also serves on the board of directors of Globalstar, Inc. (NYSE:GSAT) and is a member of its audit committee and compensation committee and serves as the chairman of its strategic review committee. Mr. Wolff earned his law degree from Northwestern School of Law, Lewis & Clark College in Portland, Oregon, and his Bachelor of Science degree from California Polytechnic State University. We believe Mr. Wolff’s leadership roles as a founder of and investor in technology companies and his perspective, experience and institutional knowledge as Sarcos’ former Chief Executive Officer qualify him to serve on our Board of Directors.

Committee

Memberships:

Strategic

Transaction

Other Current Public

Directorships:

Globalstar

 

 

 

 

 

Leadership

 

Technology

 

Operations

 

Finance

 

Customers

 

Global

Business

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    2022 PROXY STATEMENT | 10

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

 

Continuing Directors

 

 

 

 

Priya Balasubramaniam

 

 

 

 

 

Qualifications, Skills and Experience

 

    

 

 

 

Priya Balasubramaniam has served as a member of the Board of Directors since September 24, 2021. Ms. Balasubramaniam has served as the Vice President, Operations at Apple Inc. since October 2014, overseeing core technologies operations and iPhone operations. Ms. Balasubramaniam has worked in a number of senior operations and procurement roles, and in 2013 took on leadership of the worldwide iPhone Operations team. Since September 2021, Ms. Balasubramaniam has managed all of Product Operations for Apple. Prior to Apple she worked at Asea Brown Boveri in India for 3 years as a design engineer. Ms. Balasubramaniam holds a bachelor’s degree in Mechanical Engineering from Bangalore University and an MBA in Supply Chain and Marketing from Michigan State University. In 2017, she received an honorary doctorate of engineering from Michigan State University and also has a diploma in Software Technology & Systems Management. We believe that Ms. Balasubramaniam’s extensive leadership and operations experience, in particular in managing supply chains and the development and manufacture of high volume technology products at Apple, qualify her to serve on our Board of Directors.

Independent

Committee

Memberships:

Nominating

and

Corporate

Governance

Other Current Public

Directorships:

None

 

 

 

 

 

Leadership

 

Technology

 

Operations

 

Finance

 

Customers

 

Global

Business

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    2022 PROXY STATEMENT | 11

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

 

 

 

 

 

Brian D. Finn

 

 

 

 

 

Qualifications, Skills and Experience

 

  

 

 

 

Brian D. Finn has served as a member of the Board of Directors since September 24, 2021. Mr. Finn has over 35 years of experience in the financial services industry as well as a variety of corporate and philanthropic Board roles. From 2008 until he retired in 2013, Mr. Finn served as Chairman and Chief Executive Officer of Asset Management Finance Corp (AMF) and as a Senior Advisor to Credit Suisse. From 2004 to 2008, Mr. Finn was Chairman and Head of Alternative Investments (AI) at Credit Suisse. From 2002 to 2005, Mr. Finn held senior managements positions within Credit Suisse, including President of Credit Suisse First Boston (CSFB), President of Investment Banking, Co-President of Institutional Securities, Chief Executive Officer of Credit Suisse USA and a member of the Office of the Chairman of CSFB. He was also a member of the Executive Board of Credit Suisse Group. Mr. Finn began his career in 1982 as a member of the Mergers & Acquisitions Group (M&A) at The First Boston Corporation, ultimately becoming Co-Head of M&A in 1993. He has advised on dozens of transactions worth well over $100 billion. In 1997, he joined the private equity firm Clayton, Dubilier & Rice as a partner and then later rejoined Credit Suisse in 2002. Mr. Finn is a member of the board of The Scotts Miracle-Gro Company (NYSE:SMG) and was a member of the board of Owl Rock Capital Corp (NYSE:ORCC) from 2016 to February 2022. He is currently Chairman of Star Mountain Capital and Chairman of Covr Financial Technologies, as well as a board member of a number of early-stage companies. He has previously been a Strategic Advisor to KKR, member of the boards of Baxter International, Telemundo, MGM Pictures, and a number of other public and private companies. Mr. Finn is a past Chairman of the Undergraduate Executive Board of The Wharton School of the University of Pennsylvania, Vice Chairman of the Board of the City Kids Foundation and a member of the Boards of the Intrepid Fallen Heroes Fund, the Gordon A. Rich Memorial Foundation and the Starmar Foundation. Mr. Finn received a Bachelor of Science Degree in Economics from The Wharton School of the University of Pennsylvania. We believe Mr. Finn is well-qualified to serve as a member of our Board due to, among other things, his extensive experience in finance, leadership positions and strategic transactions.

Independent

Committee

Memberships:

Nominating

and

Corporate

Governance

Other Current

Public

Directorships:

Scotts

Miracle-Gro

 

 

 

 

 

Leadership

 

Technology

 

Operations

 

Finance

 

Customers

 

Global

Business

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    2022 PROXY STATEMENT | 12

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

 

 

 

 

 

Peter Klein

 

 

 

 

 

Qualifications, Skills and Experience

 

   

 

 

 

Peter Klein has served as a member of the Board of Directors since September 24, 2021. Mr. Klein joined the Board of Directors of Old Sarcos in September 2016. Mr. Klein served as Chief Financial Officer of WME, a global leader in sports and entertainment marketing, from December 2013 to July 2014, and as Chief Financial Officer of Microsoft Corporation from November 2009 to June 2013. During his 11 years at Microsoft, Mr. Klein held various other roles, including Chief Financial Officer of the Server and Tools and Microsoft Business Divisions. Before joining Microsoft, Mr. Klein spent 13 years in corporate finance at high-growth companies. He held senior finance roles with McCaw Cellular Communications, Orca Bay Capital, Asta Networks and Homegrocer.com. Mr. Klein has served on the board of directors of F5 since 2015, Denali Therapeutics since 2018 and Accolade, Inc. since 2019. Mr. Klein also served on the board of directors of Apptio from 2013 to 2019. Mr. Klein holds a B.A. from Yale University and an MBA from the University of Washington. We believe Mr. Klein’s leadership experience at some of the world’s largest technology companies and his finance and accounting expertise, in addition to his experience as a director of Old Sarcos, qualify him to serve on our Board of Directors.

Independent

Committee

Memberships:

Compensation

Strategic

Transaction

Other Current

Public

Directorships:

F5

Denali

Therapeutics

Accolade

 

 

 

 

 

 

 

Matthew Shigenobu Muta

 

 

 

 

 

Qualifications, Skills and Experience

 

   

 

 

 

Matthew Shigenobu Muta has served as a member of the Board of Directors since September 24, 2021. Mr. Muta has held various leadership roles at Delta Air Lines Inc., including serving as their Vice President, Innovation and Operations Technology from 2016 to the present, and as Vice President, Innovation & Commercial Technologies from 2014 to 2016. Mr. Muta previously held various positions at Microsoft, Inc., including Global Managing Director, Hospitality & Travel. Mr. Muta holds a Bachelor of Arts Degree in Communications from Boise State University. We believe Mr. Muta’s leadership experience at some of the world’s largest companies, including in industries that we believe include potential customers of ours, qualifies him to serve on our Board of Directors.

Independent

Committee

Memberships:

Compensation

Other Current

Public

Directorships:

None

 

 

 

 

 

Leadership

 

Technology

 

Operations

 

Finance

 

Customers

 

Global

Business

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    2022 PROXY STATEMENT | 13

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

 

 

 

 

 

Laura J. Peterson

 

 

 

 

 

Qualifications, Skills and Experience

 

   

 

 

 

Laura J. Peterson has served as a member of the Board of Directors since September 24, 2021. Ms. Peterson previously served as Vice President, China Business Development, for Boeing Commercial Airplanes, from 2012 to 2016. Prior to that, Ms. Peterson held a series of executive positions at Boeing in aircraft sales, international business development, global strategy, government relations and homeland security from 1994 to 2012. She served on the Executive Leadership Team of three Boeing Commercial Airplanes (BCA) CEOs, as well as on the Executive Leadership Teams of BCA Airplane Production and Supplier Management, BCA Strategy and Boeing International. Ms. Peterson has served on the board of directors of Air Transport Services Group, Inc. (Nasdaq:ATSG) since June 2018, and is a member of its audit committee and nominating and governance committee. Ms. Peterson holds a B.S. in Industrial Engineering from Stanford University and an M.B.A. from The Wharton School at the University of Pennsylvania and is a Fellow of the Stanford Distinguished Careers Institute. We believe Ms. Peterson’s extensive experience in international business, operations, government relations and leadership roles, in particular at Boeing, in addition to her experience as a director of public companies, qualifies her to serve on our Board of Directors .

Independent

Committee

Memberships:

Audit

Other Current

Public

Directorships:

Air Transport Services Group

 

 

 

 

 

Leadership

 

Technology

 

Operations

 

Finance

 

Customers

 

Global

Business

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    2022 PROXY STATEMENT | 14

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

 

 

 

 

 

Dennis Weibling

 

 

 

 

 

Qualifications, Skills and Experience

 

  

 

 

 

Dennis Weibling has served as a member of the Board of Directors since September 24, 2021. Mr. Weibling joined the board of directors of Old Sarcos in September 2016 and served as chairman of its audit committee until the Business Combination when he joined our Board and became Chairman of the Audit Committee. Mr. Weibling has served as the Managing Director of Rally Capital LLC since 2004. He served as a director of Holicity Inc. (Nasdaq:HOL) from August 2020 to June 2021 and has served as a director of Colicity Inc. (Nasdaq:COLI) since February 2021. Mr. Weibling also served on Sotheby’s board and as chairman of its audit and finance committees, from 2006 until October 2019. Mr. Weibling also served as Sotheby’s interim Chief Financial Officer from January 2016 until March 2016. He also serves as Trustee for the estate of Keith W. McCaw and associated family trusts. Mr. Weibling has also served on the boards of private companies including Telesphere Communications Networks, Rise Communities LLC, Telecom Transport Management, Wireless Services Corporation, Worldwide Packets, Inc., Teledesic Corporation, Geopass, Inc. d/b/a Pirq, and SeaMobile, Inc. Mr. Weibling served as President of Eagle River, Inc., from October 1993 through December 2001, and as Vice Chairman of Eagle River Investments from January 2002 through November 2004. He served as Chief Executive Officer of Nextel Communications Inc. from October 1995 to March 1996, and as a director of Nextel from July 1995 until April 1, 2004. At Nextel, Mr. Weibling was a member and chairman of the operations, audit, finance, and compensation committees at various times during that period. Mr. Weibling served as a board member of Nextel Partners from 1998 to 2006 and chaired the audit committee. His other public company board was XO Communications, Inc., where he served from 1996 to 2003. Mr. Weibling holds a Bachelor of Arts Degree from Wittenberg University, a Master of Arts Degree in Psychology from the University of Nebraska, and a J.D. from the University of Nebraska. We believe Mr. Weibling’s financial expertise and experience as an investor in technology companies, in addition to his experience as a director of various companies, qualify him to serve on our Board of Directors.

Independent

Committee

Memberships:

Audit

Nominating

and

Corporate

Governance

Strategic

Transaction

Other Current

Public

Directorships:

Colicity

 

 

 

 

 

Leadership

 

Technology

 

Operations

 

Finance

 

Customers

 

Global

Business

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    2022 PROXY STATEMENT | 15

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

 

Director Independence

Our common stock is listed on Nasdaq. We are required under Nasdaq listing standards and our Corporate Governance Guidelines to maintain a Board comprised of a majority of independent directors. Under Nasdaq listing standards, a director will only qualify as an independent director if, in the opinion of that listed company’s board of directors, the director does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In addition, Nasdaq listing standards require that, subject to specified exceptions, each member of our Audit, Compensation and Nominating and Corporate Governance Committees be independent.

Audit Committee members must also satisfy the additional independence criteria set forth in Rule 10A-3 under the Securities Exchange Act of 1934, as amended, or the Exchange Act, and Nasdaq listing standards applicable to audit committee members. Compensation Committee members must also satisfy the additional independence criteria set forth in Rule 10C-1 under the Exchange Act and Nasdaq listing standards applicable to compensation committee members.

Our Nominating and Corporate Governance Committee and our Board of Directors has undertaken a review of the independence of each of our directors. Based on information provided by each director concerning his or her background, employment and affiliations, our Nominating and Corporate Governance Committee and our Board of Directors has determined that each of Ms. Balasubramaniam, Mr. Finn, Mr. Klein, Mr. Muta, Admiral Olson, Ms. Peterson and Mr. Weibling, representing seven of our nine directors, is an “independent director” as defined under the listing standards of Nasdaq. Ms. Allgood is not an independent director because of her position as our chief executive officer; and Mr. Wolff is not an independent director because of his prior service as our chief executive officer and his current service as our Executive Chairman.

In making these determinations, our Board of Directors considered the current and prior relationships that each director has with our company and all other facts and circumstances that our Board of Directors deemed relevant in determining their independence, including the beneficial ownership of our capital stock by each non-employee director and the transactions involving them described in the section titled “Related Person Transactions.”

Family Relationships

There are no family relationships among any of our executive officers, directors or persons nominated or chosen to be a director or officer. Julie Wolf serves as our Chief Legal Officer and Corporate Secretary and is married to Benjamin Wolf, our Executive Chairman.

Board Leadership Structure

Our Corporate Governance Guidelines provide our Board flexibility to determine the appropriate leadership structure for the company, and whether the roles of chairperson and chief executive officer should be separated or combined. In making this determination, our Board considers many factors, including the needs of the business, our Board’s assessment of its leadership needs from time to time and the best interests of our stockholders. If the role of chairperson is filled by a director who does not qualify as an independent director, then our Corporate Governance Guidelines provide that one of our independent directors will serve as our Lead Independent Director.

 

    2022 PROXY STATEMENT | 16

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

Currently, Ms. Allgood serves as our President and Chief Executive Officer and is not an independent director; and Mr. Wolff serves as an executive officer in the role of Executive Chairman and is not an independent director. Our Board believes that it is currently appropriate to separate the roles of chairperson and chief executive officer. In addition, because our chairperson is also not an independent director, our Board has designated Mr. Weibling as our Lead Independent Director. Our Chief Executive Officer is responsible for day-to-day leadership. In addition to the responsibilities traditionally assigned to the chairperson of the Board of Directors, our Executive Chairman’s responsibilities include, among other things: working with our Chief Executive Officer to develop our strategy, identify potential strategic initiatives and transactions and define our future product roadmap; acting as chair of the Strategic Transaction Committee; working with the Chief Executive Officer on investor communications strategies and ensuring that we have good relationships with stockholders and other stakeholders; and working with the Lead Independent Director to ensure that there is sufficient time during Board meetings for effective discussion of agenda items and key issues and concerns of the Board, as well as fostering an environment in which directors ask questions and express their viewpoints. Our Lead Independent Director ensures that our Boards time and attention is focused on providing independent oversight of management and matters critical to our company. In addition our Lead Independent Director presides over periodic meetings of our independent directors, serves as a liaison between our independent directors and our non-independent directors and performs such additional duties as our Board of Directors may otherwise determine or delegate. The Board believes that Mr. Wolff’s deep knowledge of the company and industry due to his prior service as our Chief Executive Officer, as well as his strong leadership and business experience, enable him to provide an important bridge between our Board of Directors, especially our independent directors, and management. Further, our Board believes that his significant stock ownership aligns his interests with those of our other stockholders. The Board believes that Mr. Weibling’s extensive experience serving on public company boards of directors makes him ideally suited to act independently of management and serve as our Lead Independent Director.

Role of the Board in Risk Oversight Process

Risk is inherent with every business, and we face a number of risks, including strategic, financial, business and operational, legal and compliance, cybersecurity and reputational risks. We have designed and implemented processes to manage risk in our operations. However, risk management is an evolving process requiring us to continually look for opportunities to further embed risk management processes into our business and organization. Management is responsible for the day-to-day management of risks the company faces, while our Board of Directors, as a whole and assisted by its committees, has responsibility for the oversight of risk management.  Our Board reviews strategic and operational risk in the context of discussions, question and answer sessions, and reports from the management team at each regular Board meeting, receives reports on all significant Board committee activities at each regular Board meeting and evaluates the risks inherent in significant transactions.

In addition, our Board has tasked designated standing Board committees with oversight of certain categories of risk management. Our Audit Committee assists our Board in fulfilling its oversight responsibilities with respect to risk management in the areas of internal control over financial reporting and disclosure controls and procedures, legal and regulatory compliance and related party transactions and conflicts of interest. Our Compensation Committee assesses risks relating to our human capital management and our executive compensation plans and arrangements, including whether our compensation policies and programs have the potential to encourage excessive or inappropriate risk taking. Our Nominating and Corporate Governance Committee assesses risks relating to our corporate governance practices and the independence of the Board.

 

 

 

    2022 PROXY STATEMENT | 17

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

Our Board of Directors believes its current leadership structure, as well as having fully independent Audit, Compensation and Nominating and Corporate Governance Committees, supports the risk oversight function of the Board.

Board Committees

Our Board of Directors has established the following standing committees of the Board: Audit Committee; Compensation Committee; Nominating and Corporate Governance Committee; and Strategic Transaction Committee. The composition and responsibilities of each of the committees of our Board of Directors is as follows:

 

 

Committee Memberships

Current Directors

Audit

Compensation

Nominating and Corporate

Governance

Strategic

Transaction

Kiva Allgood

 

 

 

 

Priya Balasubramaniam

 

 

 

Brian D. Finn

 

 

 

Peter Klein

 

 

 

Matthew Shigenobu Muta

 

 

 

Eric T. Olson

 

 

Laura J. Peterson

 

 

 

Dennis Weibling

 

Benjamin G. Wolff

 

 

 

 

   = Member     = Chair

Audit Committee

The members of our Audit Committee are Admiral Eric T. Olson (Ret.), Laura J. Peterson and Dennis Weibling, with Dennis Weibling serving as chairperson. Our Nominating and Corporate Governance Committee and Board of Directors have determined that each member of the Audit Committee meets the requirements for independence and financial literacy under the rules and regulations of the Securities and Exchange Commission, or the SEC, and the listing standards of Nasdaq applicable to audit committee members. In addition, our Board of Directors has determined that Dennis Weibling is an “audit committee financial expert” within the meaning of Item 407(d) of Regulation S-K under the Securities Act of 1933, as amended, or the Securities Act. Our Audit Committee, among other things:

 

selects, retains, compensates, evaluates, oversees and, where appropriate, terminates our independent registered public accounting firm;

 

reviews and approves the scope and plans for the audits and the audit fees and approves all non-audit and tax services to be performed by our independent auditor;

 

evaluates the independence and qualifications of our independent registered public accounting firm;

 

reviews our financial statements, and discusses with management and our independent registered public accounting firm the results of the annual audit and quarterly reviews;

 

reviews and discusses with management and our independent registered public accounting firm the quality and adequacy of our internal controls and our disclosure controls and procedures;

 

discusses with management our procedures regarding the presentation of our financial information, and reviews earnings press releases and guidance;

 

oversees the design, implementation and performance of our internal audit function, if any;

 

    2022 PROXY STATEMENT | 18

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

 

 

sets hiring policies with regard to the hiring of employees and former employees of our independent registered public accounting firm and oversees compliance with such policies;

 

reviews, approves and monitors and reviews conflicts of interest of our Board of Directors members and officers and related party transactions;

 

adopts and oversees procedures to address complaints regarding accounting, internal accounting controls and auditing matters, including confidential, anonymous submissions by our employees of concerns regarding questionable accounting or auditing matters;

 

reviews and discusses with management and our independent registered public accounting firm the adequacy and effectiveness of our legal, regulatory and ethical compliance programs;

 

reviews and discusses with management and our independent registered public accounting firm our guidelines and policies to identify, monitor and address enterprise risks;

 

reviews and monitors compliance with our Code of Business Conduct and Ethics; and

 

oversees, assists in the exploration and evaluation of, negotiates and, if appropriate, recommends to the Board of Directors for approval strategic alternatives.

Our Audit Committee operates under a written charter that satisfies the applicable listing standards of Nasdaq. A copy of the Audit Committee’s charter is available on our website at https://investor.sarcos.com/governance/documents-charters.

Compensation Committee

The members of our Compensation Committee are Peter Klein, Matthew Shigenobu Muta and Admiral Eric T. Olson (Ret.), with Peter Klein serving as chairperson. Our Nominating and Corporate Governance Committee and Board of Directors have determined that each member of the Compensation Committee meets the requirements for independence under the rules and regulations of the SEC and the listing standards of Nasdaq applicable to Compensation Committee members, and that each member of the Compensation Committee is also a non-employee director, as defined pursuant to Rule 16b-3 promulgated under the Exchange Act. Our Compensation Committee, among other things:

 

reviews and approves the compensation for our executive officers, including our chief executive officer;

 

reviews, approves and administers our employee benefit and equity incentive plans;

 

establishes and reviews the compensation plans and programs of our employees, and ensures that they are consistent with our general compensation strategy;

 

monitors compliance with any stock ownership guidelines;

 

approves or makes recommendations to our Board of Directors regarding the creation or revision of any clawback policy; and

 

determines non-employee director compensation.

Our Compensation Committee operates under a written charter that satisfies the applicable listing standards of Nasdaq. A copy of the Compensation Committee’s charter is available on our website at https://investor.sarcos.com/governance/documents-charters.

 

 

 

    2022 PROXY STATEMENT | 19

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

Nominating and Corporate Governance Committee

The members of our Nominating and Corporate Governance Committee are Priya Balasubramaniam, Brian D. Finn and Dennis Weibling, with Brian D. Finn serving as chairperson. Our Nominating and Corporate Governance Committee and Board of Directors has determined that each member of the Nominating and Corporate Governance Committee meets the requirements for independence under the listing standards of Nasdaq. Our Nominating and Corporate Governance Committee, among other things:

 

reviews and assesses and makes recommendations to our Board of Directors regarding desired qualifications, expertise and characteristics sought of Board members;

 

identifies, evaluates, selects or makes recommendations to our Board of Directors regarding nominees for election to our Board of Directors;

 

develops policies and procedures for considering stockholder nominees for election to our Board of Directors;

 

reviews the succession planning process for our chief executive officer and any other members of our executive management team;

 

reviews and makes recommendations to our Board of Directors regarding the composition, organization and governance of our Board of Directors and its committees;

 

reviews and makes recommendations to the Board of Directors regarding our Corporate Governance Guidelines and corporate governance framework;

 

oversees director orientation for new directors and continuing education for our directors;

 

oversees the evaluation of the performance of the Board of Directors and its committees; and

 

administers policies and procedures for communications with the non-management members of the Board of Directors.

Our Nominating and Corporate Governance Committee operates under a written charter that satisfies the applicable listing standards of Nasdaq. A copy of the Nominating and Corporate Governance Committee’s charter is available on our website at https://investor.sarcos.com/governance/documents-charters.

 

Strategic Transaction Committee

Our Board of Directors has created a Strategic Transaction Committee. The members of the Strategic Transaction Committee are Brian D. Finn, Peter Klein, Dennis Weibling and Benjamin G. Wolff, with Benjamin G. Wolff serving as chairperson. The Strategic Transaction Committee assists in the assessment of strategic acquisition opportunities and reports its findings to the Board of Directors.

 

    2022 PROXY STATEMENT | 20

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

Attendance at Board, Board Committee and Stockholder Meetings

We completed the Business Combination on September 24, 2021 whereby a subsidiary of Rotor, a publicly-traded special acquisition company, combined with Old Sarcos and Rotor changed its name to Sarcos Technology and Robotics Corporation. At that time, the members of Rotor’s Board of Directors (other than Mr. Finn) resigned and were replaced with our current Board of Directors. During 2021, the Board after the Business Combination and the board of directors of Old Sarcos prior to the Business Combination held in the aggregate 9 meetings, and each director attended at least 75% of the total of (1) such aggregate number of meetings and (2) the number of meetings held by all committees of the Board after the Business Combination and the committees of the Old Sarcos board of directors prior to the Business Combination, in each case on which such director served during the periods that such director served.

Mr. Finn served on Rotor’s board of directors during 2021 until the Business Combination and then continued to serve on our Board following the Business Combination. Mr. Finn attended at least 75% of the aggregate of (1) the total number of meetings of Rotor’s board of directors prior to the Business Combination and our Board after the Business Combination and (2) total number of meetings of committees of Rotor’s board prior to the Business Combination and our Board after the Business Combination, in each case on which he served during the periods that he served.

Although we do not have a formal policy requiring attendance by members of our Board of Directors at our annual meetings of stockholders, we strongly encourage directors to attend. The Annual Meeting will be our first annual meeting of stockholders since the Business Combination.

Executive Sessions of Non-Employee and Independent Directors

To encourage and enhance communication among non-employee directors, our Corporate Governance Guidelines provide that the non-employee directors will meet in executive sessions without management directors or management present on a periodic basis, but no less than two times per year. In addition, if any of our non-employee directors are not independent directors, then our independent directors will also meet in executive session on a periodic basis, but no less than two times per year. These executive sessions are chaired by Dennis Weibling, our Lead Independent Director.

Compensation Committee Interlocks and Insider Participation

Between September 24, 2021, the date of the Business Combination, and December 31, 2021, the members of our Compensation Committee were Peter Klein (Chair), Matthew Shigenobu Muta and Eric T. Olson. None of the members of our Compensation Committee is or has been an officer or employee of our company. None of our executive officers currently serves, or in the past fiscal year has served, as a member of the board of directors or compensation committee (or other board committee performing equivalent functions) of any entity that has one or more executive officers serving on our Board of Directors or Compensation Committee.

 

 

 

    2022 PROXY STATEMENT | 21

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

Considerations in Evaluating Director Nominees

Our Nominating and Corporate Governance Committee uses a variety of methods for identifying and evaluating potential director nominees. In its evaluation of director candidates, including the current directors eligible for re-election, our Nominating and Corporate Governance Committee will consider the current size and composition of our Board of Directors and the needs of our Board of Directors and the respective committees of our Board of Directors and other director qualifications. While our Board has not established minimum qualifications for Board members, some of the factors that our Nominating and Corporate Governance Committee considers in assessing director nominee qualifications include issues of character, professional ethics and integrity, judgment, business acumen, proven achievement and competence in one’s field, the ability to exercise sound business judgment, tenure on the Board and skills that are complementary to the Board, an understanding of our business, an understanding of the responsibilities that are required of a member of the Board, other time commitments, diversity with respect to professional background, education, race, ethnicity, gender, age and geography, as well as other individual qualities and attributes that contribute to the total mix of viewpoints and experience represented on our Board. The Nominating and Corporate Governance Committee and the Board evaluate each director in the context of the membership of the Board as a group, with the objective of maintaining a Board that can best perpetuate the success of the business and represent stockholder interests through the exercise of sound judgment using its diversity of backgrounds and experience in various areas. Although our Board of Directors does not maintain a specific policy with respect to Board diversity, our Board of Directors believes that the Board should be a diverse body, and the Nominating and Corporate Governance Committee considers a broad range of perspectives, backgrounds and experiences when considering whether to recommend the nomination of any particular director candidate.

If our Nominating and Corporate Governance Committee determines that an additional or replacement director is required, then the committee may take such measures as it considers appropriate in connection with its evaluation of a director candidate, including candidate interviews, inquiry of the person or persons making the recommendation or nomination, engagement of an outside search firm to gather additional information or reliance on the knowledge of the members of the committee, the Board or management.

After completing its review and evaluation of director candidates, our Nominating and Corporate Governance Committee recommends to our full Board of Directors the director candidates for nomination. Our Nominating and Corporate Governance Committee has discretion to decide which individuals to recommend for nomination as directors and our Board of Directors has the final authority in determining the selection of director candidates for nomination to our Board.

Stockholder Recommendations and Nominations to our Board of Directors

Our Nominating and Corporate Governance Committee will consider recommendations and nominations for candidates to our Board of Directors from stockholders in the same manner as candidates recommended to the committee from other sources, so long as such recommendations and nominations comply with our Second Amended and Restated Certificate of Incorporation, or our Charter, and our Amended and Restated Bylaws, or our Bylaws, all applicable company policies and all applicable laws, rules and regulations, including those promulgated by the SEC. Our Nominating and Corporate Governance Committee will evaluate such recommendations in accordance with its charter, our Bylaws and our Corporate Governance Guidelines and the director nominee criteria described above.

 

    2022 PROXY STATEMENT | 22

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

A stockholder that wants to recommend a candidate to our Board of Directors should direct the recommendation in writing by letter to our Corporate Secretary at Sarcos Technology and Robotics Corporation, 650 South 500 West, Suite 150, Salt Lake City, Utah 84101, Attention: Corporate Secretary. Such recommendation must include the candidates name, home and business contact information, detailed biographical data, relevant qualifications, a signed letter from the candidate confirming willingness to serve, information regarding any relationships between the candidate and us and evidence of the recommending stockholders ownership of our capital stock. Such recommendation must also include a statement from the recommending stockholder in support of the candidate. Stockholder recommendations must be received by December 31st of the year prior to the year in which the recommended candidate(s) will be considered for nomination. Our Nominating and Corporate Governance Committee has discretion to decide which individuals to recommend as nominees for election as directors, and our Board has discretion to decide which individuals to nominate for election as directors.

Under our Bylaws, stockholders may also directly nominate persons for election to our Board of Directors. Any nomination must comply with the requirements set forth in our Bylaws and the rules and regulations of the SEC and should be sent in writing to our Corporate Secretary at the address above. To be timely for our 2023 annual meeting of stockholders, nominations must be received by our Corporate Secretary observing the deadlines discussed below under “Other Matters—Stockholder Proposals or Director Nominations for 2023 Annual Meeting.”

Communications with the Board of Directors

Stockholders and other interested parties wishing to communicate directly with our non-management directors, may do so by writing and sending the correspondence to our Chief Legal Officer, Chief Financial Officer or Legal Department by mail to our principal executive offices at Sarcos Technology and Robotics Corporation, 650 South, 500 West, Suite 150, Salt Lake City, Utah 84101. Our Chief Legal Officer, Chief Financial Officer or Legal Department, in consultation with appropriate directors as necessary, will review all incoming communications and screen for communications that (1) are solicitations for products and services, (2) relate to matters of a personal nature not relevant for our stockholders to act on or for our Board to consider and (3) matters that are of a type that are improper or irrelevant to the functioning of our Board or our business, for example, mass mailings, job inquiries and business solicitations. If appropriate, our Chief Legal Officer, Chief Financial Officer or Legal Department will route such communications to the appropriate director(s) or, if none is specified, then to the chairperson of the Board or the lead independent director (if one is appointed) if the chairperson of the Board is not independent. These policies and procedures do not apply to communications to non-management directors from our officers or directors who are stockholders or stockholder proposals submitted pursuant to Rule 14a-8 under the Exchange Act.

Policy Prohibiting Hedging or Pledging of Securities

Under our insider trading policy, our employees, including our executive officers, and members of our Board of Directors are prohibited from, directly or indirectly, (1) engaging in short sales, (2) trading in publicly-traded options, such as puts and calls, and other derivative securities with respect to our securities (other than stock options, restricted stock units and other compensatory awards issued to such individuals by us), (3) purchasing financial instruments (including prepaid variable forward contracts, equity swaps, collars and exchange funds), or otherwise engaging in transactions that hedge or offset, or are designed to hedge or offset, any decrease in the market value of equity securities granted to them by us as part of their compensation or held, directly or indirectly, by them, (4) pledging

 

 

 

    2022 PROXY STATEMENT | 23

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

any of our securities as collateral for any loans or as part of any other pledging transaction and (5) holding our securities in a margin account.

Corporate Governance Guidelines and Code of Business Conduct and Ethics

Our Board of Directors has adopted our Corporate Governance Guidelines. These guidelines address, among other items, the qualifications and responsibilities of our directors and director candidates, the structure and composition of our Board of Directors and corporate governance policies and standards applicable to us in general. In addition, our Board of Directors has adopted a Code of Business Conduct and Ethics that applies to all of our employees, officers and directors, including our Chief Executive Officer, Chief Financial Officer and other executive and senior financial officers. The full text of our Corporate Governance Guidelines and Code of Business Conduct and Ethics are available on our website at https://investor.sarcos.com/governance/documents-charters. We will post any amendments to or waivers of our Code of Business Conduct and Ethics for directors and executive officers on the same website.

Other Corporate Governance Policies and Practices

Changes in Employment or Circumstances

Upon a change in employment with his or her principal employer, any non-employee director shall promptly inform our Chief Legal Officer, Chief Financial Officer or Legal Department or the Lead Independent Director (if one is appointed), who will discuss the issue with the Nominating and Corporate Governance Committee. The Nominating and Corporate Governance Committee will assess the appropriateness of such director remaining on the Board and shall recommend to the Board whether to request that such director tender his or her resignation. Similarly, if a director becomes aware of circumstances that may adversely reflect upon the director, any other director or our company, the director should notify the Nominating and Corporate Governance Committee of such circumstances. The Nominating and Corporate Governance Committee will consider the circumstances and may request the director to cease the related activity or, in more severe cases, request that the director submit his or her resignation.

Limitations on Other Board Service / Overboarding

Directors are expected to advise the Nominating and Corporate Governance Committee of any invitations to join the board of directors of any other public company or changes to their committee membership prior to joining such other board or committee assignment. No director should serve on more than four additional public company boards without the approval of our Board, and our Chief Executive Officer should not serve on more than two additional public company boards.

Director Orientation and Continuing Education

We are committed to ensuring that all directors receive orientation and continuing education as appropriate. The Nominating and Corporate Governance Committee oversees director orientation and director continuing education.

Self-Evaluation

 

    2022 PROXY STATEMENT | 24

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

The Nominating and Corporate Governance Committee oversees a periodic self-evaluation by the Board, each committee of the Board and each director.

Succession Planning

The Nominating and Corporate Governance Committee works with the Chief Executive Officer to plan for Chief Executive Officer succession, as well as to develop plans for interim succession in the event the need arises unexpectedly. Further, the Nominating and Corporate Governance Committee works with the Chief Executive Officer and appropriate members of management to plan for succession for each of the other senior executives.

Access and Resources

Our Corporate Governance Guidelines provide that our directors at all times shall have direct, independent and confidential access to our executive officers, management and personnel in order to fulfill their duties. The Board is expressly authorized to obtain, at the Company’s expense, such data, advice, consultation and documentation as the Board deems appropriate and to retain consultants, independent counsel or other advisers to advise or assist the Board in the performance of any of its responsibilities or for any other matter related to the Board’s purposes.

Sustainability

Our mission is to save lives and prevent injury while helping humans accomplish more than ever before. We believe that if we are successful in our mission, we will contribute to a more sustainable workforce while increasing productivity. Our products are designed to reduce worker injury, prolong the years that people can perform physically-demanding tasks by transferring the physical impact from humans to robots and democratize the workforce by enabling people of various physical capabilities and ages to lift the same amounts and otherwise perform the same physically-demanding tasks. As our organization grows larger and begins to mature, we are committed to running a sustainable business.

Environment

While we are early in our efforts to understand and address the environmental impact of our business, we have taken a number of actions to reduce the impact we have on the environment. Our environmental impact efforts center around waste management and recycling, implementing smart, eco-friendly manufacturing processes and reducing the use of single-use plastics in our Salt Lake City office.

We have also made significant strides in reducing the power consumption of our products, in particular our Guardian XO full-body powered exoskeleton. We have reduced its power consumption by over 90% from its initial hydraulically-powered units to its current lithium battery-powered units, which uses less than 500 watts of power while walking at 3 mph – about the same amount of power as an LED big screen TV.

Diversity and Inclusion

We strive to create an inclusive work environment for all of our employees, and we believe that diversity in thought, background, race and ethnicity, gender and gender identity, sexual orientation and other characteristics and creating an atmosphere where employees feel welcome and accepted is critical to

 

 

 

    2022 PROXY STATEMENT | 25

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

our success. To help create this atmosphere we have adopted core company values and an employee pledge. Our employees pledge to do their best to:

 

treat everyone on our team, regardless of seniority or role, the way they want to be treated;

 

trust one’s colleagues and believe that they have the best of intentions;

 

proactively communicate in a candid manner, with sufficient information to allow one’s colleagues to achieve their objectives;

 

be open minded and receptive to review, constructive feedback and collaboration;

 

act with integrity by doing what is right for the company, customers, colleagues and oneself;

 

demonstrate a positive can-do attitude coupled with the drive and determination to win, while holding oneself accountable for both one’s success and the success of the company;

 

never criticize, disparage or malign colleagues behind their backs or in front of others; and

 

not tolerate anyone in the company doing anything inconsistent with any of the above.

We are currently in the process of reviewing and updating our values and employee pledge and expect that that process will help us continue to build an inclusive and collaborative culture and environment.

We are also actively seeking to increase the diversity of our workforce. For example, we have recently engaged two minority-owned recruiting firms to help us find and attract minority and other diverse candidates.

We also strive to ensure that our employee benefits promote a diverse and inclusive work environment. For example, our employee benefits currently include:

 

Parental leave: 16 weeks paid parental (gender neutral) leave to support childbirth, newborn care within one year of birth and childcare within one year of adoption by or placement in foster care with an employee. Further, we provide flexible schedules for returning parents (gender neutral) for 30 days.

 

Medical, dental and vision insurance for the employee and family, including domestic partners.

 

Employee Assistance Program: provides unlimited counseling (in person or virtual) benefits to employees, including for marital and family matters, stress, anxiety or depression, personal or emotional challenges, grief or loss, substance abuse or addictions and senior care planning.

 

Floating Holidays: 2 floating holidays at the employee’s discretion to accommodate diverse needs and interests.

 

Volunteer time off: 2 days off per year to provide volunteer services for the organization of the employee’s choice.

 

Other benefits include: identity theft insurance, life and disability insurance, flexible time off, flexible work schedules, tuition reimbursement program, gym membership reimbursement program, pet insurance, 401k match and health savings account match.

 

    2022 PROXY STATEMENT | 26

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

As of April 30, 2022:

 

 

 

Director Compensation

In October 2021, our Compensation Committee adopted a new outside director compensation policy for our non-employee directors. This director compensation policy is designed to attract, retain and reward non-employee directors. Under the director compensation policy, each non-employee director will receive the cash and equity compensation for Board services described below. We also will reimburse our non-employee directors for reasonable, customary and documented travel expenses to meetings of our Board of Directors or its committees and other expenses.

 

Cash Compensation

Non-employee directors are entitled to receive the following cash compensation for their service under the director compensation policy:

 

$50,000 per year for service as a Board member;

 

$15,000 per year for service as chair of the Audit Committee;

 

$7,500 per year for service as member of the Audit Committee;

 

$7,500 per year for service as chair of the Compensation Committee;

 

$3,750 per year for service as member of the Compensation Committee;

 

$3,000 per year for service as chair of the Nominating and Corporate Governance Committee; and

 

$1,500 per year for service as chair of the Nominating and Corporate Governance Committee.

All cash payments to non-employee directors are paid quarterly in arrears on a pro-rated basis.

Equity Compensation

Initial Award

On December 9, 2021, each individual who served as a non-employee director on that date was granted an initial award of restricted stock units (the “Initial Award”), with a grant date fair value (determined in accordance with U.S. generally accepted accounting principles (GAAP)) equal to $100,000, rounded to the nearest whole share. The total number of shares underlying each Initial

 

 

 

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

Award was 12,315. Each Initial Award vests on the earlier of: (i) the first anniversary of the date the Initial Award is granted or (ii) the day prior to the date of the annual meeting of our stockholders next following the date the Initial Award was granted, in each case, subject to the non-employee continuing to provide services to us through the applicable vesting date.

New Director Award

 

Going forward, each individual who becomes a non-employee director will automatically be granted on the date of the director’s appointment a new director award of restricted stock units (the “New Director Award”), with a grant date fair value (determined in accordance with GAAP) of $150,000 multiplied by a fraction (i) the numerator of which is (x) 12 minus (y) the number of months between the date of the last annual meeting of stockholders and the date the non-employee directors becomes a member of the Board of Directors and (ii) the denominator of which is 12. The New Director Award will vest on the earlier of (i) the one-year anniversary of the date the New Director Award is granted or (ii) the day of the annual meeting next following the date the New Director Award is granted, in each case, subject to the non-employee director continuing to be a service provider through the applicable vesting date.

Annual Award

 

Each non-employee director will automatically receive, on the date of each annual meeting of our stockholders, an annual award of restricted stock units (an “Annual Award”), with a grant date fair value (determined in accordance with GAAP) of $150,000, rounded to the nearest whole share. The Annual Award will vest on the earlier of (i) the one-year anniversary of the date the Annual Award is granted or (ii) the day prior to the date of the annual meeting next following the date the Annual Award is granted, in each case, subject to the non-employee director continuing to be a service provider through the applicable vesting date.

 

In the event of a “change in control” (as defined in our 2021 Equity Incentive Plan), each non-employee director’s outstanding awards will become fully vested.

 

    2022 PROXY STATEMENT | 28

 

 

 


BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

Director Compensation for 2021

 

The following table sets forth information regarding the total compensation awarded to, earned by or paid to our non-employee directors for their service on our Board of Directors, for the fiscal year ended December 31, 2021. Directors who are also our employees receive no additional compensation for their service as directors. During fiscal 2021, Mr. Wolff and Ms. Allgood were our employees and executive officers and therefore did not receive compensation as a director. See “Executive Compensation” for additional information regarding Mr. Wolff’s and Ms. Allgood’s compensation.

 

Name

 

Fees

Paid or

Earned in

Cash ($)

 

 

Stock

Awards

($)(1)

 

 

Options

Awards

($)

 

 

Non-Equity

Incentive Plan

Compensation

($)

 

 

Change in

Pension

Value and

Nonqualified

Deferred

Compensation

Earnings ($)

 

 

All Other

Compensation ($)

 

 

Total ($)

 

Priya Balasubramaniam

 

$12,875

 

 

$99,998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$112,873

 

Brian D. Finn

 

$15,125

 

 

$99,998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$115,123

 

Peter Klein

 

$14,375

 

 

$99,998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$114,373

 

Matthew Shigenobu Muta

 

$13,438

 

 

$99,998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$113,436

 

Admiral Eric T. Olson

 

$13,813

 

 

$99,998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$113,811

 

Laura J. Peterson

 

$14,375

 

 

$99,998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$114,373

 

Dennis Weibling

 

$16,625

 

 

$99,998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$116,623

 

 

(1) The amounts in this column represent the aggregate grant-date fair value of awards granted to each non-employee director pursuant to the non-employee director compensation policy, computed in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 718. See Notes 1 and 8 to our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2021 for a discussion of the assumptions made by us in determining the grant-date fair value of our equity awards.

The following table lists all outstanding equity awards held by non-employee directors as of December 31, 2021:

 

Name

Number of Shares
Underlying
Outstanding
Stock Awards

Number of Shares
Underlying
Outstanding
Options

Priya Balasubramaniam

12,315

Brian D. Finn

12,315

Peter Klein

12,315

256,460

Matthew Shigenobu Muta

12,315

Eric T. Olson

12,315

102,584

Laura J. Peterson

12,315

Dennis Weibling

12,315

11,756

 

 

 

 

 

    2022 PROXY STATEMENT | 29

 

 

 


 

 

PROPOSAL NO. 1

ELECTION OF CLASS I DIRECTORS

Our Board of Directors currently consists of nine directors and is divided into three classes with staggered three-year terms. At the Annual Meeting, three Class I directors are up for election for a three-year term to succeed the same class whose term is then expiring. Each director’s term continues until the expiration of the term for which such director was elected and until such director’s successor is elected and qualified or until such director’s earlier death, resignation or removal.

Nominees

Our Nominating and Corporate Governance Committee has recommended that the Board of Directors nominate, and our Board of Directors has nominated, Kiva Allgood, Eric Olson and Benjamin G. Wolff for election as Class I directors at the Annual Meeting. Each of the nominees is a current director whose term is expiring upon the Annual Meeting. If elected, each of the nominees will serve as a Class I director until the 2025 annual meeting of stockholders and until his or her respective successor is elected and qualified or until his or her earlier death, resignation or removal. For more information concerning the nominees, please see the section titled “Board of Directors and Corporate Governance.”

Each of the nominees has agreed to serve as a director if elected, and management has no reason to believe that they will be unavailable to serve. In the event a nominee is unable or declines to serve as a director at the time of the Annual Meeting, proxies will be voted for any nominee designated by the present Board of Directors to fill the vacancy.

Vote Required

Each director is elected by a plurality of the voting power of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors. Because the outcome of this proposal will be determined by a plurality vote, any shares not voted FOR a particular nominee, whether as a result of choosing to WITHHOLD authority to vote or a broker non-vote, will have no effect on the outcome of the election.

Board Recommendation

 

 

OUR BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE ELECTION OF EACH OF THE DIRECTOR NOMINEES NAMED ABOVE.

 

 

 

 

 

 

 

    2022 PROXY STATEMENT | 30

 

 

 


 

 

PROPOSAL NO. 2

RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Our Audit Committee has appointed Ernst & Young LLP as our independent registered public accounting firm to audit our consolidated financial statements for our fiscal year ending December 31, 2022. Ernst & Young LLP served as our independent registered public accounting firm for the fiscal year ended December 31, 2021 and served as Old Sarcos’ independent registered public accounting firm since December 2020.

At the Annual Meeting, we are asking our stockholders to ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for our fiscal year ending December 31, 2022. Our Audit Committee is submitting the appointment of Ernst & Young LLP for stockholder ratification because we value our stockholders’ views on our independent registered public accounting firm and as a matter of good corporate governance. Notwithstanding the appointment of Ernst & Young LLP, and even if our stockholders ratify the appointment, our Audit Committee, in its discretion, may appoint another independent registered public accounting firm at any time during our fiscal year. If our stockholders do not ratify the appointment of Ernst & Young LLP, our Audit Committee will reconsider the appointment and may decide either to continue with Ernst & Young LLP as our independent registered public accounting firm for our fiscal year ending December 31, 2022 or to appoint another independent registered public accounting firm. Representatives of Ernst & Young LLP are expected to be present at the Annual Meeting, and they will have an opportunity to make a statement and are expected to be available to respond to appropriate questions from our stockholders.

Change in Independent Registered Public Accounting Firm

Sarcos Technology and Robotics Corporation

As previously reported under Item 4.01 of our Current Report on Form 8-K filed with the SEC on September 30, 2021 (the “Form 8-K”), on September 24, 2021 the Board, including all members of the Audit Committee, approved a resolution appointing Ernst & Young LLP as our independent registered public accounting firm to audit our consolidated financial statements for the fiscal year ended December 31, 2021. Ernst & Young LLP served as the independent registered public accounting firm of Old Sarcos prior to the Business Combination. Accordingly, Marcum LLP, Rotor’s independent registered public accounting firm prior to the Business Combination, was informed on September 24, 2021 that it was dismissed as our independent registered public accounting firm. The audit report of Marcum LLP on Rotor’s financial statements for the fiscal year ended December 31, 2020, its year of formation and sole reporting fiscal year, did not contain an adverse opinion or a disclaimer of opinion, and was not qualified or modified as to uncertainties, audit scope or accounting principles. During the period from August 27, 2020 (inception) through December 31, 2020 and the subsequent interim period through September 24, 2021, there were no disagreements between Rotor and Marcum LLP on any matter of accounting principles or practices, financial disclosure or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Marcum LLP, would have caused it to make reference to the subject matter of the disagreements in its reports on Rotor’s financial statements for such year. During the period from August 27, 2020 (inception) through December 31, 2020 and the subsequent interim period through September 24, 2021, there were no “reportable events” (as defined in Item 304(a)(1)(v) of Regulation S-K under the Exchange Act), except for a material weakness in Rotor’s pre-Business Combination internal control over financial reporting related to the accounting for warrants issued by Rotor. We provided Marcum LLP with a copy of the Form 8-K and requested that Marcum LLP furnish us with a letter addressed to the SEC stating whether it agreed with the

 

 

 

    2022 PROXY STATEMENT | 31

 

 

 


PROPOSAL NO. 2

 

disclosures in the Form 8-K and, if not, stating in which respects it did not agree. A copy of Marcum LLP’s letter, dated September 24, 2021, was filed as Exhibit 16.1 to the Form 8-K, and such letter is incorporated by reference herein. During the fiscal year ended December 31, 2020 and the subsequent interim period through September 24, 2021, neither we nor any party acting on our behalf, consulted with Ernst & Young LLP with respect to either (i) the application of accounting principles to a specified transaction, either completed or proposed, or the type of the audit opinion that might be rendered with respect to our consolidated financial statements, and no written report or oral advice was provided to us by Ernst & Young LLP that was an important factor considered by us in reaching a decision as to any accounting, auditing or financial reporting issue, or (ii) any matter that was subject to any disagreement (as that term is defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions) or a reportable event (as that term is defined in Item 304(a)(1)(v) of Regulation S-K).

Old Sarcos

As previously disclosed in the proxy statement/prospectus filed on August 6, 2021, as supplemented on August 30, 2021, or the Prior Disclosure, on December 18, 2020, Old Sarcos’ finance committee, representing the Old Sarcos board of directors, ratified Old Sarcos’ engagement of Ernst & Young LLP to serve as Old Sarcos’ independent registered public accounting firm and Old Sarcos’ determination not to re-engage Tanner, LLC as Old Sarcos’ independent auditors. Tanner, LLC previously audited Old Sarcos’ consolidated financial statements for the years ended December 31, 2019 and 2018 in accordance with auditing standards generally accepted in the United States. Following its engagement, Ernst & Young LLP reaudited in accordance with the standards of the PCAOB, and Old Sarcos reissued its consolidated financial statements as of and for the year ended December 31, 2019. Tanner, LLC did not audit Old Sarcos’ consolidated financial statements for any period subsequent to the year ended December 31, 2019. The Independent Auditors’ Report on Old Sarcos’ consolidated financial statements for the years ended December 31, 2019 and 2018 did not contain an adverse opinion or a disclaimer of opinion, or was qualified or modified as to uncertainty, audit scope or accounting principles. During the two fiscal years ended December 31, 2019 and 2018, there were (i) no disagreements with Tanner, LLC on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedures, which disagreements, if not resolved to the satisfaction of Tanner, LLC, would have caused them to make reference to the subject matter of the disagreements in their audit reports, and (ii) no “reportable events” as such term is defined in Item 304(a)(1)(v) of Regulation S-K. We provided Tanner, LLC with a copy of the Prior Disclosure, and Tanner, LLC furnished a letter addressed to the SEC stating that it agreed with the statements made in the Prior Disclosure. A copy of Tanner, LLC’s letter was filed as Exhibit 16.1 of our Current Report on Form 8-K filed on August 12, 2021 and such letter is incorporated by reference herein. During the two fiscal years ended December 31, 2019 and 2018, neither Old Sarcos, nor any party acting on its behalf, consulted with Ernst & Young LLP with respect to either (i) the application of accounting principles to a specified transaction, either completed or proposed, or the type of the audit opinion that might be rendered with respect to Old Sarcos’ consolidated financial statements, and no written report or oral advice was provided to Old Sarcos by Ernst & Young LLP that was an important factor considered by Old Sarcos in reaching a decision as to any accounting, auditing or financial reporting issue, or (ii) any matter that was subject to any disagreement (as that term is defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions) or a reportable event (as that term is defined in Item 304(a)(1)(v) of Regulation S-K).

 

    2022 PROXY STATEMENT | 32

 

 

 


PROPOSAL NO. 2

 

Fees Paid to the Independent Registered Public Accounting Firm

 

The following table presents fees for professional audit services and other services rendered to us and Old Sarcos by Ernst & Young LLP for the years ended December 31, 2021 and 2020.

 

 

 

2021

 

 

2020

 

 

 

 

(in thousands)

 

 

Audit Fees(1)

 

$

1,675

 

 

$

705

 

 

Audit-Related Fees(2)

 

 

 

 

 

 

 

Tax Fees(3)

 

 

 

 

 

 

 

Total Fees

 

$

1,675

 

 

$

705

 

 

 

(1)

“Audit Fees” consist of fees for professional services rendered in connection with the audit of our consolidated financial statements, review of our quarterly consolidated financial statements and consultations and services in connection with statutory and regulatory filings or engagements for those fiscal years. This category also includes $0.8 million of fees during 2021 for services incurred in connection with the Business Combination. The 2020 fees include audit fees for the 2019 audit opinion in connection with our registration statements.

(2)

There were no fees billed by Ernst & Young LLP for professional services rendered for audit-related services for the years ended December 31, 2021 and 2020, respectively.

(3)

There were no fees billed by Ernst & Young LLP for professional services rendered for tax services for the years ended Decembe4 31, 2021 and 2020, respectively.

Auditor Independence

In 2021, there were no other professional services provided by Ernst & Young LLP, other than those listed above, that would have required our Audit Committee to consider their compatibility with maintaining the independence of Ernst & Young LLP.

Audit Committee Policy on Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm

Upon completion of the Business Combination, our Audit Committee established a policy governing our use of the services of our independent registered public accounting firm. Under this policy, our Audit Committee is required to pre-approve all audits and audit fees, and pre-approve (or, where permitted under the rules and regulations of the SEC, subsequently approve) all non-audit and tax services to be performed by our independent registered public accounting firm. Since the adoption of this policy, all services provided by Ernst & Young LLP for our fiscal year ended December 31, 2021 were pre-approved by our Audit Committee.

Vote Required

The ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for our fiscal year ending December 31, 2022 requires the affirmative vote of a majority of the voting power of the shares present in person or represented by proxy at the Annual Meeting and entitled to vote thereon. Abstentions will have the same effect as a vote AGAINST this proposal. As this proposal is considered a routine proposal, we do not expect any broker non-votes with respect to this proposal.

Board Recommendation

 

 

OUR BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR OUR FISCAL YEAR ENDING DECEMBER 31, 2022.

 

 

 

 

 

 

 

    2022 PROXY STATEMENT | 33

 

 

 


 

 

REPORT OF THE AUDIT COMMITTEE

We, the Audit Committee of the Board of Directors of Sarcos Technology and Robotics Corporation (the “Company”), have the responsibility to, among other things, oversee the preparation of the Company’s consolidated financial statements, the Company’s system of internal controls and the qualifications, independence, compensation and performance of the Company’s independent registered public accounting firm (the “independent auditor”). We have the sole authority and responsibility to select, evaluate and, when appropriate, replace the Company’s independent auditor. Our specific duties and responsibilities are described in our charter, which is available on the Company’s website (www.sarcos.com) under the tab “Investor – Investor Relations - Governance.” We review the charter annually and work with the Board of Directors and the Nominating and Corporate Governance Committee of the Board of Directors to amend it as appropriate. The Board of Directors has determined that each of us is an independent director based on the Nasdaq Stock Market’s listing standards and that each of us also satisfies the Securities and Exchange Commission’s (“SEC”) additional independence requirements for members of Audit Committees. In addition, the Board of Directors has determined that Dennis Weibling is an “audit committee financial expert” as defined by SEC rules.

Management is responsible for the financial reporting process, including the Company’s system of internal controls, and for the preparation of the Company’s consolidated financial statements in accordance with U.S. generally accepted accounting principles (GAAP). The Company’s independent auditor, Ernst & Young LLP (“EY”), is responsible for performing an independent audit of the Company’s consolidated financial statements in accordance with the auditing standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”) and to issue reports thereon. Because the Company is an Emerging Growth Company as defined by SEC rules, EY is not required to, nor has it been engaged to, perform an audit of the Company’s internal control over financial reporting. Our responsibility is to oversee these processes, and we rely on the expertise and knowledge of management and the independent auditor in carrying out that role. We are not professionally engaged in the practice of accounting or auditing and do not provide any expert or other special assurance or professional opinion as to the sufficiency of external audits, whether the Company’s consolidated financial statements are complete and accurate and are in accordance with GAAP or on the effectiveness of the Company’s system of internal control over financial reporting.

We reviewed and discussed with management and EY the Company’s periodic reports for the year ended December 31, 2021, including the Company’s 2021 audited consolidated financial statements and related annual report on Form 10-K, filed with the SEC. In connection with such discussions, EY addressed the matters required to be discussed with us by applicable PCAOB standards and SEC rules and regulations. In addition, we discussed with EY the overall scope and plans for its audit. We meet periodically with EY, as appropriate, to discuss its work and the results of its audit. Our meetings included, whenever we deemed appropriate, executive sessions with EY without the presence of management.

We have also received the written disclosures and the letter from EY required by PCAOB Rule 3526 (“Communication With Audit Committees Concerning Independence”) and have discussed with EY its independence with respect to the Company.

 

 

 

    2022 PROXY STATEMENT | 34

 

 

 


REPORT OF THE AUDIT COMMITTEE

 

We assessed EY’s performance as independent auditor during 2021, including the performance of the lead audit partner and the audit team, a process we will undertake on an annual basis. We reviewed a variety of indicators of audit quality relating to EY, including:

 

 

the quality and candor of its communications with us and management, its responsiveness and accessibility, and its historical and recent performance on the Company’s audits;

 

 

how effectively it maintained its independence and employed independent judgment, objectivity and professional skepticism;

 

 

external data about quality and performance, including reports by the PCAOB and EY’s response to those reports;

 

 

the appropriateness of its fees, taking into account the Company’s size and complexity and the resources necessary to perform the audit; and

 

 

its knowledge of the Company’s operations, accounting policies and practices.

As a result of our evaluation of the independent auditor’s performance and considering other factors we deemed relevant, we concluded that the selection of EY as the Company’s independent auditor for the year ending December 31, 2022 is in the best interests of the Company and its stockholders.

Based on the review and discussions referred to above related to the Company’s annual report on Form 10-K, including the report of the independent auditor, we recommended to the Board of Directors that the Company’s audited financial statements be included in the Company’s annual report on Form 10-K for the year ended December 31, 2021.

Respectfully submitted by the members of the Audit Committee of the Board of Directors:

 

Dennis Weibling, Chair

Eric T. Olson

Laura J. Peterson

This Audit Committee report shall not be deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A promulgated by the SEC or to the liabilities of Section 18 of the Exchange Act, and shall not be deemed incorporated by reference into any prior or subsequent filing by Sarcos under the Securities Act of 1933, as amended, or the Securities Act, or the Exchange Act, except to the extent Sarcos specifically requests that the information be treated as “soliciting material” or specifically incorporates it by reference.

 

 

 

 

    2022 PROXY STATEMENT | 35

 

 

 


 

 

EXECUTIVE OFFICERS

The following table sets forth certain information about our executive officers as of May 1, 2022.

 

Name

 

Age

 

Position

Kiva Allgood(1)

 

49

 

President, Chief Executive Officer and Director

Benjamin G. Wolff(1)

 

53

 

Executive Chairman and Director

Steven Hansen

 

57

 

Executive Vice President and Chief Financial Officer

Dr. Denis Garagić(2)

 

53

 

Chief Technology Officer

Kristi Martindale

 

55

 

Executive Vice President and Chief Product & Marketing Officer

Jorgen Pedersen(3)

 

50

 

Chief Operating Officer

 

(1)

Biographical information for Ms. Allgood and Mr. Wolff is set forth above under Board of Directors and Corporate Governance – Nominees for Director beginning on page 5.

(2)

Dr. Denis Garagić was promoted to Chief Technology Officer after December 31, 2021 and was determined to be an executive officer on March 25, 2022

(3)

Mr. Pedersen became our Chief Operating Officer and an executive officer upon the closing of our acquisition of RE2 on April 25, 2022.

 

 

Steven Hansen

 

 

 

 

 

 

 

Steven Hansen has served as our Executive Vice President and Chief Financial Officer since September 24, 2021. Mr. Hansen served as Old Sarcos’ Chief Financial Officer from September 2019 until the Business Combination, at which time he became our Executive Vice President and Chief Financial Officer. From May 2017 to September 2019, Mr. Hansen served as Executive Advisor to the University of Utah Health. From October 2015 to November 2016, Mr. Hansen served as Chief Financial Officer of Global Access, an international shipping company. Also, during most of 2015 Mr. Hansen served as Chief Financial Officer of CustomersFirst Now, a customer experience consulting firm. Mr. Hansen recently served as an advisor to the board of directors and management of Vaporsens, a nanofibril-based sensor company located in Utah, and assisted in the merger of the business with a publicly-traded tech company. He holds a Bachelor of Science degree in International Finance from Brigham Young University in Utah and a Master of Business Administration degree from California State University in Fresno.

 

 

 

 

 

 

 

 

    2022 PROXY STATEMENT | 36

 

 

 


EXECUTIVE OFFICERS

 

 

 

 

Dr. Denis Garagić

 

 

 

 

 

 

 

Dr. Denis Garagić has served as our Chief Technology Officer since January 2022. Dr. Garagić served as Old Sarcos’ Chief Scientist, Advanced Systems and AI from June 2020 until the Business Combination when he became our Chief Scientist, Advanced System & AI, a position he held until his promotion in January 2022. Prior to joining Old Sarcos, he served as Chief Scientist at BAE Systems FAST Labs, guiding the creation of cognitive computing solutions that provide machine intelligence and anticipatory intelligence to solve challenges across the Department of Defense and intelligence community. Dr. Garagić has been a Technical Review Authority, Principal Investigator, or Research Lead on numerous programs, including the Defense Advanced Research Projects Agency (DARPA) and Air Force Research Labs research programs. Dr. Garagić is also a regular speaker at international meetings and conferences on AI & machine learning. Dr. Garagić received his B.S. and M.S. degrees in Mechanical Engineering and Technical Cybernetics from The Czech Technical University in Prague and received his Ph.D. in Mechanical Engineering from The Ohio State University.

 

 

 

 

 

 

Kristi Martindale

 

 

 

 

 

 

 

Kristi Martindale has served as our Executive Vice President and Chief Product & Marketing Officer since September 24, 2021. Ms. Martindale served as Old Sarcos’ Chief Product & Marketing Officer from September 2020 until the Business Combination, when she became our Executive Vice President and Chief Product & Marketing Officer. Prior to serving as Old Sarcos’ Executive Vice President and Chief Product & Marketing Officer, Ms. Martindale served as Old Sarcos’ Executive Vice President and Chief Marketing Officer. From 2011 to 2015, Ms. Martindale served as Vice President, Global Marketing of Qualcomm. In this role, she led marketing for many of Qualcomm’s business units, including software, services, emerging technology, and licensing worldwide. Ms. Martindale currently serves as an Advisory Board Member for 5P Consulting and Magic Leap and also serves on the board of directors for Walden Family Services. Ms. Martindale holds a Bachelor of Science degree in Business Administration and Management from the University of La Verne.

 

 

 

 

 

 

 

 

    2022 PROXY STATEMENT | 37

 

 

 


EXECUTIVE OFFICERS

 

 

 

 

Jorgen Pedersen

 

 

 

 

 

 

 

Jorgen Pedersen has served as our Chief Operating Officer since April 25, 2022 when he joined us in connection with and as a condition to our acquisition of RE2. Prior to joining us, Mr. Pedersen had served as Chief Executive Officer of RE2 since 2001, when he founded RE2. As Chief Executive Officer of RE2, Mr. Pedersen was responsible for overseeing all aspects of RE2’s business, including its strategic direction, developing partnerships and alliances and overseeing day-to-day operations. Prior to founding RE2, Mr. Pedersen was at Carnegie Mellon’s National Robotics Engineering Center. From September 2012 to June 2018, he served as chairman of the Robotics Division of the National Defense Industrial Association (NDIA) and as its vice chairman from October 2007 to September 2012, and he has also served as a member of the Board of Trustees for NDIA (2011-2015) and a member of the board of directors of the National Advanced Mobility Consortium (2014-2015). Mr. Pedersen currently serves on the boards of directors of the Pittsburgh Robotics Network (2020 to present, and has been part of its leadership since 2016) and Catalyst Connection (2019 to present), two industry organizations located in Pittsburgh, Pennsylvania. Mr. Pedersen has received a number of awards, including being recognized as the 2016 Carnegie Science Start-up Entrepreneur of the Year and for his technology leadership by the Department of Defense. Mr. Pedersen holds a Bachelor of Science degree in Electrical and Computer Engineering from Carnegie Mellon University and a Master of Science degree in Robotics from Carnegie Mellon University.

 

 

 

 

 

 

 

    2022 PROXY STATEMENT | 38

 

 

 


 

 

EXECUTIVE COMPENSATION

To achieve our goals, we have designed, and intend to modify as necessary, our compensation and benefits program to attract, retain, incentivize and reward deeply talented and qualified executives who share our philosophy and desire to work towards achieving these goals. We believe our compensation program should promote our success and align executive incentives with the long-term interests of our stockholders. Our current compensation programs primarily consist of salary, bonuses and equity compensation awards. We believe that our use of equity compensation awards strongly aligns the interests of our executive officers with those of our stockholders by providing meaningful compensation opportunities through the use of long-term equity incentives. Further, we believe that the vesting schedules associated with our equity compensation awards promote our accomplishment of key objectives and our long-term success. As a result, we do not believe that our compensation programs promote excessive or inappropriate risk-taking. As our needs evolve, we intend to continue to evaluate our philosophy and compensation programs as circumstances require.

Our named executive officers, consisting of each individual serving in the role of principal executive officer and the next two most highly compensated executive officers (other than our principal executive officers), as of December 31, 2021 were:

 

Kiva Allgood, our President and Chief Executive Officer;

 

Benjamin Wolff, our Executive Chairman and former Chief Executive Officer;

 

Marian Joh, our former Chief Operating Officer; and

 

Fraser Smith, our Chief Innovation Officer.

Summary Compensation Table

The following table presents information regarding the compensation of our named executive officers for services rendered during the fiscal years ended December 31, 2020 and December 31, 2021:

 

Name and Principal Position

 

Fiscal

Year

 

Salary ($)

 

 

 

Bonus

($)(1)

 

 

Stock Awards

($)(2)

 

 

Option

Awards ($)

 

 

Total ($)

 

Kiva Allgood(3)

 

2021

 

$

8,654

 

 

 

$

 

 

$

3,000,002

 

 

$

3,001,038

 

 

$

6,009,694

 

President and Chief Executive Officer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Benjamin Wolff (4)

 

2021

 

$

396,258

 

 

 

$

225,500

 

 

$

47,218,086

 

(7)

$

5,565,845

 

 

$

53,405,689

 

Executive Chairman

 

2020

 

$

163,561

 

(5)

 

$

 

 

$

354,442

 

 

$

 

 

$

518,003

 

Marian Joh

 

2021

 

$

256,923

 

 

 

$

 

 

$

1,802,000

 

 

$

2,202,861

 

 

$

4,261,784

 

Former Chief Operating Officer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fraser Smith

 

2021

 

$

334,719

 

 

 

$

122,500

 

 

$

990,853

 

(7)

$

 

 

$

1,448,072

 

Chief Innovation Officer

 

2020

 

$

285,005

 

(6)

 

$

 

 

$

161,985

 

 

$

 

 

$

446,990

 

 

(1)

The amounts in this column represent discretionary bonuses approved by our Compensation Committee in recognition of these named executive officers’ contributions to our company in 2021 and their continued employment with us. The amounts represent 100% of the named executive officer’s target annual bonus for 2021.

(2)

The amounts in this column represent the aggregate grant-date fair value of awards granted to each named executive officer, computed in accordance with the FASB ASC Topic 718. See Notes 1 and 8 to our audited consolidated financial statements included in our annual report on Form 10-K for the year ended December 31, 2021 for a discussion of the assumptions made by us in determining the grant-date fair value of our equity awards.

(3)

Ms. Allgood became our President and Chief Executive Officer on December 13, 2021.

(4)

Benjamin Wolff served as our Chief Executive Officer from September 24, 2021 until December 13, 2021. Prior to that, Mr. Wolff served as the Chief Executive Officer of Old Sarcos in 2020 and 2021.

(5)

This amount reflects the period between January 1, 2020 and September 28, 2020, during which Mr. Wolff’s salary was reduced to $83,047.71.

 

 

 

    2022 PROXY STATEMENT | 39

 

 

 


EXECUTIVE COMPENSATION

 

(6)

This amount reflects the period between January 1, 2020 and January 31, 2020, during which Mr. Smith’s salary was reduced to $7,528.73.

(7)

This amount includes the increase in fair value of restricted stock unit awards resulting from modifications of such awards as described below under “2021 RSU Amendment.”

Outstanding Equity Awards at Fiscal 2021 Year-End

The following table sets forth information regarding outstanding equity awards held by Sarcos’ named executive officers as of December 31, 2021.

 

 

 

 

 

Stock Awards

 

 

Option Awards

 

 

 

 

Name(3)

 

Grant

Date(1)

 

Number of

Unearned

Shares,

Units or

Other

Rights That

Have Not

Vested(#)

 

 

 

 

 

Market Value

of Units of

Stock that

Have Not

Vested (2)
($)

 

 

Number of

Securities

Underlying

Unexercised Options

Exercisable

 

Number of

Securities

Underlying

Unexercised

Options

Unexercisable

Unearned

Options

 

 

 

 

 

Option

Exercise

Price

 

Option

Expiration

Date

 

Kiva Allgood

 

12/13/2021

 

 

 

 

 

 

 

 

 

 

680,272

 

 

(4)

 

 

$

7.31

 

12/12/2031

 

Kiva Allgood

 

12/13/2021

 

 

410,397

 

 

(5)

 

 

$

3,000,002

 

 

 

 

 

 

 

 

 

 

 

Benjamin Wolff

 

3/31/2021

 

 

5,129,222

 

 

(6)

 

 

$

45,049,998

 

 

 

 

 

 

 

 

 

 

 

Benjamin Wolff

 

5/11/2021

 

 

 

 

 

 

 

 

 

 

1,025,844

 

 

(7)

 

 

$

8.79

 

5/11/2031

 

Marian Joh

 

9/24/2021

 

 

250,168

 

 

(8)

 

 

$

1,802,000

 

 

 

 

 

 

 

 

 

 

Marian Joh

 

6/17/2021

 

 

 

 

 

 

 

 

 

 

153,876

 

 

(9)

 

 

$

8.79

 

6/16/2031

 

Marian Joh

 

6/17/2021

 

 

 

 

 

 

 

 

 

 

256,461

 

 

(10)

 

 

$

8.79

 

6/16/2031

 

 

(1)

Represents grant dates of the stock option and stock awards.

(2)

The amounts in this column represent the grant date fair value calculated in accordance with FASB ASC Topic 718.

(3)

Fraser Smith does not have any outstanding equity awards at December 31, 2021.

(4)

25% of the shares subject to the option award will vest on December 13, 2022, and thereafter 1/12th of the shares subject to the option award shall vest every three months on the same day of the month, subject to Ms. Allgood’s continued service through such date.

(5)

Represents restricted stock units with each unit representing the right to receive one share of our Common Stock (“RSUs”). 25% of the award will vest on December 13, 2022, and thereafter 1/12th of the remaining portion of the award will vest every three months on the same day of the month subject to continued service through such date.

(6)

Vests over a 15-month period following the consummation of a qualifying transaction, subject to continued service. See “2021 Wolff Equity Awards” section below.

(7)

Vests and becomes exercisable as to 25% of the grant on September 24, 2022, the one-year anniversary of the closing of the Business Combination, and as to 1/36th of the remaining portion of the grant at the end of each month thereafter, provided that 100% immediately vests and becomes exercisable upon the earlier of (i) a termination of service for reason other than a voluntary termination by Mr. Wolff that is not for “good reason” or a termination by us for cause, in either case, on or within the twelve (12) month period following the consummation of a change of control or (ii) the death of Mr. Wolff.

(8)

Represents RSUs: (i) 51,292 of which would have vested upon satisfaction of two conditions if Ms. Joh had remained an employee or provider of services to us: (A) a time and service requirement satisfied as to 1/4th of the RSUs on February 23, 2022 and thereafter 1/36th of the RSUs on each monthly vesting date following the vesting commencement date; and (B) a liquidity event requirement satisfied on the earliest to occur of the twelve months following the closing of an IPO of the our equity securities pursuant to an effective registration statement, immediately prior to a change in control transaction or immediately prior to an acquisition of our Common Stock and (ii) 153,876 of which would have vested upon satisfaction of two conditions had Ms. Joh remained an employee or provider of services to us: (A) a time and service requirement satisfied as to 1/4th of the RSUs on April 21, 2022 and thereafter 1/36th of the RSUs on each monthly vesting date following the vesting commencement date; and (B) a liquidity event requirement satisfied on the earliest to occur of the twelve months following the closing of an IPO of our equity securities pursuant to an effective registration statement, immediately prior to a change in control transaction or immediately prior to an acquisition of our Common Stock. Our Board of Directors deemed the liquidity event requirement conditions satisfied effective as of the of the Business Combination. This award was cancelled prior to vesting in connection the termination of Ms. Joh’s employment.

(9)

25% of the shares subject to the option would have vested on February 23, 2022 with 1/48th of the shares subject to the option vesting monthly thereafter. This award was cancelled in connection with the termination of Ms. Joh's employment.

 

    2022 PROXY STATEMENT | 40

 

 

 


EXECUTIVE COMPENSATION

 

(10)

25% of the shares subject to the option would have vested on May 6, 2022 with 1/48th of the shares subject to the option vesting monthly thereafter. This award was cancelled in connection with the termination of Ms. Joh's employment.

2021 Equity Compensation Decisions

2021 Allgood Equity Awards

Ms. Allgood’s 2021 equity awards were her new-hire awards granted pursuant to her employment agreement. See below for a description of Ms. Allgood’s employment agreement.

2021 Wolff Equity Awards

In February 2021, Mr. Wolff was granted an award of shares of Old Sarcos common stock which, following the consummation of the Business Combination, represents 5,129,222 shares of our Common Stock (the “2021 Wolff RSA”). In May 2021, Mr. Wolff was granted an option to purchase shares of Old Sarcos common stock with an exercise price per share equal to the fair market value of Old Sarcos’ common stock, as determined by Old Sarcos’ board of directors on the grant date (the “2021 Wolff Option” and together with the 2021 Wolff RSA, the “2021 Wolff Equity Awards”). Following the consummation of the Business Combination, the 2021 Wolff Option represents an option to purchase 1,025,844 shares of our Common Stock at an exercise price per share equal to $8.79.

The Old Sarcos board of directors, in consultation with an outside compensation consultant, considered many factors in determining the size and terms of the 2021 Wolff Equity Awards, including Mr. Wolff’s percentage ownership in Old Sarcos, the estimated value of his Old Sarcos ownership interests, market data for similarly situated executives at comparable companies with an emphasis on the ownership percentage, Mr. Wolff’s past and expected future contributions to Old Sarcos, and the potential dilutive effect of these grants if Old Sarcos consummated a transaction with Rotor or any other qualifying transaction.

The 2021 Wolff RSA vests in four, equal quarterly installments beginning on March 24, 2022, the date that is six months following the Business Combination, subject to Mr. Wolff’s continued service, provided that 100% of the 2021 Wolff RSA will immediately vest upon the earlier of (i) a change of control following the Business Combination, (ii) a termination of Mr. Wolff’s service for reason other than a voluntary termination by Mr. Wolff that is not for “good reason” or a termination by us for “cause”, in either case, on or within the twelve (12) month period following the consummation of a “change of control” that occurs before a qualifying merger transaction (which transaction would include the closing of the Business Combination) or (iii) Mr. Wolff’s death.

The 2021 Wolff Option vests and becomes exercisable as to 25% of the grant on September 24, 2022, the one-year anniversary of the Business Combination, and as to 1/36th of the remaining portion of the grant at the end of each month thereafter, provided that 100% of the 2021 Wolff Option immediately vests and becomes exercisable upon the earlier of (i) a termination of Mr. Wolff’s service for reason other than a voluntary termination by Mr. Wolff that is not for “good reason” or a termination by us for “cause”, in either case, on or within the twelve (12) month period following the consummation of a “change of control” or (ii) Mr. Wolff’s death. The 2021 Wolff Option has a term of 10 years, subject to earlier termination upon his termination.

2021 Joh Equity Awards

Ms. Joh’s June 2021 option awards were her new-hire awards granted in connection with her joining Old Sarcos. In September 2021, we entered into an employment agreement with Ms. Joh and granted her RSUs as set forth in the table above. See below for a description of Ms. Joh’s employment agreement. All of these awards were forfeited upon her termination of employment.

 

 

 

    2022 PROXY STATEMENT | 41

 

 

 


EXECUTIVE COMPENSATION

 

2021 RSU Amendment

In April 2021, the Old Sarcos board of directors approved an amendment to then-outstanding awards of restricted stock units held by the named executive officers. This amendment resulted in the satisfaction of the liquidity-event performance condition upon the completion of the Business Combination.

Named Executive Officer Employment Arrangements

Our named executive officers are at-will employees. The key terms of employment with respect to our named executive officers are discussed below. In addition, each of our named executive officers has executed our standard form of confidential information, invention assignment, nonsolicitation and noncompetition agreement, or confidentiality agreement.

Kiva Allgood

In December 2021, we entered into an employment agreement with Ms. Allgood (the “Allgood Employment Agreement”) in connection with Ms. Allgood’s appointment as our president and chief executive officer. The Allgood Employment Agreement does not have a specific term and provides that Ms. Allgood is an at-will employee. Under the Allgood Employment Agreement, Ms. Allgood receives an initial base salary of $450,000 per year and is eligible to receive an annual target bonus of 100% of Ms. Allgood’s annual base salary. During the term of her employment with us, and for so long as she spends more than half of her working-time each month at our Salt Lake City headquarters, we will pay her a monthly stipend in cash of $5,000 per month, less applicable tax withholding, to cover corporate housing costs in the Salt Lake City metropolitan area.

In connection with Ms. Allgood’s appointment as President and Chief Executive Officer, the Board of Directors granted to Ms. Allgood (1) an option to purchase shares of our Common Stock with an approximate value of $3,000,000 and (2) an award of restricted stock units with respect to shares of our Common Stock with an approximate value of $3,000,000. These equity awards are described in further detail in the “Outstanding Equity Awards at Fiscal 2021 Year-End” table above.

If, within the period beginning three months before and ending twelve months after a change in control, or the change in control period, Ms. Allgood’s employment is terminated by us without “cause” (excluding by reason of death or “disability”) or she resigns for “good reason” (as such terms are defined in her employment agreement), Ms. Allgood will become entitled to the following benefits:

 

a lump-sum payment equal to twelve months of her annual base salary at the highest rate during the term of the Allgood Employment Agreement;

 

a lump-sum payment equal to 100% of her target annual bonus as in effect for the fiscal year in which her termination of employment occurs or, if such amount is greater, as in effect immediately before the change in control;

 

reimbursement for the premium costs to continue health coverage under the Consolidated Omnibus Reconciliation Act of 1985 as amended, or COBRA, or taxable monthly payments in lieu thereof equal to such premium costs, in either case, for up to twelve months following her termination date; and

 

100% accelerated vesting of all outstanding equity awards, and, with respect to equity awards with performance-based vesting, unless otherwise specified in the award agreements governing such equity awards, all performance goals or other vesting criteria will be deemed achieved at target levels.

 

    2022 PROXY STATEMENT | 42

 

 

 


EXECUTIVE COMPENSATION

 

If, outside the change in control period, Ms. Allgood’s employment is terminated by us without cause (excluding by reason of death or disability) or she resigns for good reason, Ms. Allgood will become entitled to the following benefits:

 

continued payment of her annual base salary at the highest rate during the term of the Allgood Employment Agreement for a period of twelve months following her termination date; and

 

reimbursement for the premium costs to continue health coverage under COBRA, or taxable monthly payments in lieu thereof equal to such premium costs, in either case, for up to twelve months following her termination date.

The receipt of the payments and benefits above is conditioned on Ms. Allgood timely signing and not revoking a release of claims, complying with her confidentiality agreement and resigning from all officer and director positions with us.

In addition, if any of the payments or benefits provided for under Ms. Allgood’s employment agreement or otherwise payable to Ms. Allgood would constitute “parachute payments” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended, or the Code, and would be subject to the related excise tax, she would be entitled to receive either full payment of such payments and benefits or such lesser amount that would result in no portion of the payments and benefits being subject to the excise tax, whichever results in the greater amount of after-tax benefits to her. Ms. Allgood’s employment agreement does not require us to provide any tax gross-up payments to her.

Benjamin Wolff

In December 2021, we entered into an amended and restated employment agreement with Mr. Wolff (the “Wolff Employment Agreement”) in connection with Mr. Wolff’s appointment as our Executive Chairman and resignation as our chief executive officer. The Wolff Employment Agreement does not have a specific term and provides that Mr. Wolff is an at-will employee. Under the Wolff Employment Agreement, Mr. Wolff’s base salary was reduced to $350,000 per year and he will not be eligible for annual performance bonuses effective of January 1, 2022. In addition, the Wolff Employment Agreement provides that Mr. Wolff will be eligible to receive annual equity awards of our restricted stock units with a target value of approximately $500,000 pursuant to any plans or arrangements we may have in effect from time to time.

If, within the period beginning three months before and ending twelve months after a change in control, or the change in control period, Mr. Wolff’s employment is terminated by us without “cause” (excluding by reason of death, or “disability”) or he resigns for “good reason” (as such terms are defined in his employment agreement), Mr. Wolff will become entitled to the following benefits:

 

a lump-sum payment equal to twelve months of his annual base salary at the highest rate during the term of the Wolff Employment Agreement;

 

a lump-sum payment equal to 100% of his target annual bonus as in effect for the fiscal year in which his termination of employment occurs (if any) or, if such amount is greater, as in effect immediately before the change in control;

 

reimbursement for the premium costs to continue health coverage under COBRA, or taxable monthly payments in lieu thereof equal to such premium costs, in either case, for up to twelve months following his termination date; and

 

100% accelerated vesting of all outstanding equity awards, and, with respect to equity awards with performance-based vesting, unless otherwise specified in the award agreements governing such equity awards, all performance goals or other vesting criteria will be deemed achieved at target levels.

 

 

 

    2022 PROXY STATEMENT | 43

 

 

 


EXECUTIVE COMPENSATION

 

If, outside the change in control period, Mr. Wolff’s employment is terminated by us without cause (excluding by reason of death or disability) or he resigns for good reason, Mr. Wolff will become entitled to the following benefits:

 

continued payment of his annual base salary at the highest rate during the term of the Wolff Employment Agreement for a period of twelve months following his termination date;

 

reimbursement for the premium costs to continue health coverage under COBRA, or taxable monthly payments in lieu thereof equal to such premium costs, in either case, for up to twelve months following his termination date; and

 

each time-based equity award (or portion thereof) that would have vested and, if applicable, become exercisable, had Mr. Wolff continued his employment through the date that is twelve (12) months following the termination date.

In addition, if Mr. Wolff’s employment is terminated by us due to Mr. Wolff’s disability or due to his death, 100% of his then-unvested our equity awards will immediately vest and, if applicable, become exercisable.

The receipt of the payments and benefits above is conditioned on Mr. Wolff timely signing and not revoking a release of claims, complying with his confidentiality agreement and resigning from all officer and director positions with us.

In addition, if any of the payments or benefits provided for under Mr. Wolff’s employment agreement or otherwise payable to Mr. Wolff would constitute “parachute payments” within the meaning of Section 280G of the Code, and would be subject to the related excise tax, he would be entitled to receive either full payment of such payments and benefits or such lesser amount that would result in no portion of the payments and benefits being subject to the excise tax, whichever results in the greater amount of after-tax benefits to him. Mr. Wolff’s employment agreement does not require us to provide any tax gross-up payments to him.

Marian Joh

In September 2021, we entered into an employment agreement with Ms. Joh, our Chief Operating Officer, that provides for the severance and change in control benefits described below and supersedes any then-existing employment agreement or arrangement Ms. Joh may have had with us. Ms. Joh’s employment terminated in January 2022. The employment agreement did not have a specific term and provided that Ms. Joh was an at-will employee. Under the employment agreement, Ms. Joh received a base salary of $350,000 per year and was eligible to receive an annual target bonus of 35% of Ms. Joh’s annual base salary.

If, within the period beginning three months before and ending twelve months after a change in control, or the change in control period, Ms. Joh’s employment was terminated by us without “cause” (excluding by reason of death, or “disability”) or she resigned for “good reason” (as such terms are defined in her employment agreement), Ms. Joh would have become entitled to the following benefits:

 

a lump-sum payment equal to six months of her annual base salary as of immediately before her termination (or if the termination is due to a resignation for good reason based on a material reduction in base salary, then as of immediately before such reduction) or, if such amount is greater, as of immediately before the change in control;

 

a lump-sum payment equal to 100% of her target annual bonus as in effect for the fiscal year in which her termination of employment occurs or, if such amount is greater, as in effect immediately before the change in control;

 

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EXECUTIVE COMPENSATION

 

 

reimbursement for the premium costs to continue health coverage under COBRA, or taxable monthly payments in lieu thereof equal to such premium costs, in either case, for up to six months following her termination date; and

 

100% accelerated vesting of all outstanding equity awards, and, with respect to equity awards with performance-based vesting, unless otherwise specified in the award agreements governing such equity awards, all performance goals or other vesting criteria will be deemed achieved at target levels.

If, outside the change in control period, Ms. Joh’s employment was terminated by us without cause (excluding by reason of death or disability) or she resigned for good reason, Ms. Joh would have become entitled to the following benefits:

 

continued payment of her annual base salary as of immediately before her termination (or if the termination is due to a resignation for good reason based on a material reduction in base salary, then as of immediately before such reduction) for six months following her termination date; and

 

reimbursement for the premium costs to continue health coverage under COBRA, or taxable monthly payments in lieu thereof equal to such premium costs, in either case, for up to six months following her termination date.

The receipt of the payments and benefits above is conditioned on Ms. Joh timely signing and not revoking a release of claims, complying with her confidentiality agreement, and resigning from all officer and director positions with us.

In addition, if any of the payments or benefits provided for under Ms. Joh’s employment agreement or otherwise payable to Ms. Joh would constitute “parachute payments” within the meaning of Section 280G of the Code and would be subject to the related excise tax, she would be entitled to receive either full payment of such payments and benefits or such lesser amount that would result in no portion of the payments and benefits being subject to the excise tax, whichever results in the greater amount of after-tax benefits to her. Ms. Joh’s employment agreement does not require us to provide any tax gross-up payments to her.

Fraser Smith

In September 2021, we entered into an employment agreement with Dr. Smith, our Chief Innovation Officer, that provides for the severance and change in control benefits described below and supersedes any then-existing employment agreement or arrangement Dr. Smith may have had with us other than the agreement memorializing his award of restricted stock units outstanding immediately prior to the Business Combination. The employment agreement does not have a specific term and provides that Dr. Smith is an at-will employee. Under the employment agreement, Dr. Smith receives a base salary of $350,000 per year and is eligible to receive an annual target bonus of 35% of Dr. Smith’s annual base salary.

If, within the period beginning three months before and ending twelve months after a change in control, or the change in control period, Dr. Smith’s employment is terminated by us without “cause” (excluding by reason of death, or “disability”) or he resigns for “good reason” (as such terms are defined in his employment agreement), Dr. Smith will become entitled to the following benefits:

 

a lump-sum payment equal to six months of his annual base salary as of immediately before his termination (or if the termination is due to a resignation for good reason based on a material reduction in base salary, then as of immediately before such reduction) or, if such amount is greater, as of immediately before the change in control;

 

 

 

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EXECUTIVE COMPENSATION

 

 

a lump-sum payment equal to 100% of his target annual bonus as in effect for the fiscal year in which his termination of employment occurs or, if such amount is greater, as in effect immediately before the change in control;

 

reimbursement for the premium costs to continue health coverage under COBRA, or taxable monthly payments in lieu thereof equal to such premium costs, in either case, for up to six months following his termination date; and

 

100% accelerated vesting of all outstanding equity awards, and, with respect to equity awards with performance-based vesting, unless otherwise specified in the award agreements governing such equity awards, all performance goals or other vesting criteria will be deemed achieved at target levels.

If, outside the change in control period, Dr. Smith’s employment is terminated by us without cause (excluding by reason of death or disability) or he resigns for good reason, Dr. Smith will become entitled to the following benefits:

 

continued payment of his annual base salary as of immediately before his termination (or if the termination is due to a resignation for good reason based on a material reduction in base salary, then as of immediately before such reduction) for six months following his termination date; and

 

reimbursement for the premium costs to continue health coverage under COBRA, or taxable monthly payments in lieu thereof equal to such premium costs, in either case, for up to six months following his termination date.

The receipt of the payments and benefits above is conditioned on Dr. Smith timely signing and not revoking a release of claims, complying with his confidentiality agreement, and resigning from all officer and director positions with us.

In addition, if any of the payments or benefits provided for under Dr. Smith’s employment agreement or otherwise payable to Dr. Smith would constitute “parachute payments” within the meaning of Section 280G of the Code and would be subject to the related excise tax, he would be entitled to receive either full payment of such payments and benefits or such lesser amount that would result in no portion of the payments and benefits being subject to the excise tax, whichever results in the greater amount of after-tax benefits to him. Dr. Smith’s employment agreement does not require us to provide any tax gross-up payments to him.

 

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EXECUTIVE COMPENSATION

 

Equity Compensation Plan Information

The following table summarizes our equity compensation plan information as of December 31, 2021. All outstanding awards relate to our common stock.

 

Plan Category