To vote in person, come to the annual meeting, at which we will give you a ballot upon request.

To vote over the telephone, dial toll-free 1-800-690-6903 using a touch-tone phone and follow the recorded instructions.  You will be asked to provide the company number and control number from the Notice.  Your telephone vote must be received by 11:59 p.m. Eastern time on June 22, 2016 to be counted.

To vote through the internet, go to www.proxyvote.com to complete an electronic proxy card.  You will be asked to provide the company number and control number from the Notice.  Your internet vote must be received by 11:59 p.m. Eastern time on June 22, 2016 to be counted.

To vote using the proxy card, simply complete, sign and date the proxy card that may be delivered and return it promptly in the envelope provided.  If you return your signed proxy card before the annual meeting, your proxyholder (one of the individuals named on your proxy card) will vote your shares as you direct.

you may submit another properly completed proxy card with a later date;

you may grant a subsequent proxy by telephone or through the internet;

you may send a timely written notice that you are revoking your proxy to our Secretary at 611 Gateway Blvd., Suite 900, South San Francisco CA 94080; or

you may attend the annual meeting and vote in person.  

The Audit Committee has authority to engage legal counsel or other experts or consultants, as it deems appropriate to carry out its responsibilities. The Board has adopted a written Audit Committee charter that is available to stockholders on our website at http://investors.atarabio.com/corporate-governance.cfm.corporate-governance.

Report of the Audit Committee of the Board of Directors¹

The Audit Committee has reviewed and discussed the audited financial statements for the fiscal year ended December 31, 20152020 with our management. The Audit Committee has discussed with the independent registered public accounting firm the matters required to be discussed by Auditing Standard No. 16, Communications with Audit Committees, as adopted bythe applicable requirements of the Public Company Accounting Oversight Board (“PCAOB”). and the SEC. The Audit Committee has also received the written disclosures and the letter from the independent registered public accounting firm required by applicable requirements of the PCAOB regarding the independent accountants’ communications with the Audit Committee concerning independence and has discussed with the independent registered public accounting firm the accounting firm’s independence. Based on the foregoing, the Audit Committee has recommended to the Board that the audited financial statements be included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2015.2020.

Matthew K. Fust

Eric L. Dobmeier

William Heiden

Compensation Committee

The Board has determined that each member of the Compensation Committee is independent under Nasdaq listing standards and Rule 10c-1 promulgated under the Exchange Act, and a “non-employee director” as defined in Rule 16b-3 promulgated under the Exchange Act.  The primary functions of this committee include:

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Compensation Committee

The Board has determined that each member of the Compensation Committee is independent under Nasdaq listing standards and Rule 10c-1 promulgated under the Exchange Act, a “non-employee director” as defined in Rule 16b-3 promulgated under the Exchange Act and an “outside director” as that term is defined in Section 162(m) of the Internal Revenue Code.  The functions of this committee include:

The Compensation Committee has authority to engage legal counsel or other experts or consultants, as it deems appropriate to carry out its responsibilities. The Board has adopted a written Compensation Committee charter that is available to stockholders on our website at http://investors.atarabio.com/corporate-governance.cfm.corporate-governance.

Compensation Committee Processes and Procedures

Typically, theThe Compensation Committee meets at least fourmet five times annually, and with greater frequency, if necessary.during 2020. The agenda for each meeting is usually developed by the Secretary andour Chief Executive Officer, Chief People Officer and General Counsel in consultation with the ChairmanChair of the Compensation Committee and our outside compensation consultants, if applicable. The Compensation Committee meets regularly in executive session. However, from time to time, various members of management and other employees as well as outside advisors or consultants may be invited by the Compensation Committee to make presentations, to provide financial or other background information or advice or to otherwise participate in Compensation Committee meetings. The Chief Executive Officer does not and will not participate in, or be present during, any deliberations or determinations of the Compensation Committee regarding his compensation. The charter of the Compensation Committee grants the Compensation Committee full access to all of our books, records, facilities and personnel. In addition, under the charter, the Compensation Committee has authority to engage legal counsel or other experts or consultants, as it deems appropriate to carry out its responsibilities. The Compensation Committee has the authority to retain compensation consultants to assist in its evaluation of executive and director compensation, including the authority to approve the consultant’s reasonable fees and other retention terms. Under the charter, the Compensation Committee may select, or receive advice from, a compensation consultant, legal counsel or other adviseradvisor to the Compensation Committee other(other than in-house legal counsel and certain other types of advisers,advisors), only after taking into consideration six factors, prescribedassessing their independence in accordance with, and to the extent required by, applicable law and the SEC and Nasdaq, that bear upon the adviser’s independence;listing requirements of Nasdaq; however, there is no requirement that any adviseradvisor be independent.

During 2015 and in February 2016,2020, the Compensation Committee engaged the Radford anadvisory team of the Rewards Solution practice at Aon Hewitt Company,(“Radford”) as independent compensation consultant. After considering all of the factors required by applicable Nasdaq rules, the Compensation Committee was satisfied with Radford’s independence and requested that Radford evaluate and help us refine our employee and non-employee director compensation strategies and practices. As part of its engagement, Radford was requested by the Compensation Committee to develop a comparative group of companies and to perform analyses of competitive performance and compensation levels for that group. With respect to the compensation of the Chief Executive Officer, Radford developed recommendations that were presented to the Compensation Committee for its consideration. Following an active dialogue with Radford, the Compensation Committee considered the recommendations in addition to corporate performance and approved the recommendations subject to certain modifications deemed appropriate by the Compensation Committee. With respect to the executive officers, the Chief Executive Officer in consultation with Radford developed recommendations that were presented to the Compensation Committee for its consideration. Following an active dialogue with the Chief Executive Officer and with Radford, the Compensation Committee considered the recommendations in addition to corporate and individual performance and approved the recommendations subject to certain modifications deemed appropriate by the Compensation Committee.

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Historically, the Compensation Committee has made most of the significant adjustments to annual compensation and determined bonus and equity awards and established new performance objectives at one or more meetings held during the first quarter of the year. However, theThe Compensation Committee also considers matters related to individual compensation, such as compensation for new executive hires, as well as high-level strategic issues, such as the efficacy of our compensation strategy, potential modifications to that strategy, risks created by that strategy and new trends, retention concerns and plans or approaches to compensation, at various meetings throughout the year. Generally, the Compensation Committee’s process comprises two related elements: (1) the determination of compensation levels and (2) the establishment of corporate goals for the current year. For executives other than the Chief Executive Officer, the Compensation Committee solicits and considers evaluations and recommendations submitted to the Committee by the Chief Executive Officer. In the case of the Chief Executive Officer, the evaluation of his performance is conducted by the Compensation Committee with feedback from the Board as well as the executives, which determines any adjustments to hisChief Executive Officer’s compensation as well as awards to be granted. For all executives and directors as part of its deliberations, the Compensation Committee may review and consider, as appropriate, materials that it deems relevant, such asrelevant. These materials may include financial reports and projections, operational data, tax and accounting information, tally sheets that set forth the total compensation that may become payable to executives in various hypothetical scenarios, executive and director stock ownership information, company stock performance data, analyses of historical executive compensation levels and current compensation levels across our companyCompany and recommendations of the Compensation Committee’s compensation consultant, including analyses of executive and director compensation paid at otherthe comparative group of companies identified(with such group of companies developed by Radford and agreed upon by the consultant.Compensation Committee).

Compensation Committee Interlocks and Insider Participation

None of the members of the Compensation Committee is currently or has been at any time one of our officers or employees. None of our executive officers currently serves, or has served during the last year, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving as a member of the Board or the Compensation Committee.

Report of the Compensation Committee of the Board of Directors²

The Compensation Committee, consisting solely of independent directors, has reviewed and discussed with management the Compensation Discussion and Analysis (“CD&A”) contained in this Proxy Statement. Based on this review and discussion, the Compensation Committee has recommended to the Board that the CD&A be included in this Proxy Statement and incorporated into the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020.

Eric L. Dobmeier

Roy Baynes

Carol S. Gallagher

Nominating and Corporate Governance Committee

The Board has determined that each member of the Nominating and Corporate Governance Committee is independent under the Nasdaq listing standards. The primary functions of this committee include:

The Nominating and Corporate Governance Committee has authority to engage advisors or consultants (including legal counsel or other experts or consultants,and search firms), as it deems appropriate to carry out its responsibilities. The Board has adopted a written Nominating and Corporate Governance Committee charter that is available to stockholders on our website at http://investors.atarabio.com/corporate-governance.cfm.corporate-governance.

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The Nominating and Corporate Governance Committee believes that candidates for director should have certain minimum qualifications, including the ability to read and understand basic financial statements, being over 21 years of age and having the highest personal integrity and ethics. TheIn evaluating director nominee candidates, the Nominating and Corporate Governance Committee typically also intends to considerconsiders factors such factors asas: possessing relevant expertise upon which to be able to offer advice and guidance to management, having sufficient time to devote to our affairs, demonstrated excellence in his or hertheir field, having the ability to exercise sound business judgment and having the commitment to rigorously represent the long-term interests of our stockholders.stockholders and other factors is deems appropriate given then-current needs of the Board and Atara, to maintain a balance of knowledge, experience and capability. However, the Nominating and Corporate Governance Committee retains the right to modify thesethe above qualifications from time to time.

The Board believes that diversity of viewpoints, background, experience and other characteristics, such as race, gender, ethnicity, sexual orientation, culture and nationality, are an important part of its makeup, and the Nominating and Corporate Governance Committee and the Board actively seek these characteristics in identifying director candidates.  

Candidates for director nominees are reviewed in the context of the current composition of the Board, our operating requirements, Nasdaq listing standards, applicable law and regulations and the long-term interests of stockholders. In conducting this assessment, theThe Nominating and Corporate Governance Committee typically considers diversity, age, skillsalso determines whether a nominee is independent for Nasdaq purposes based upon Nasdaq listing standards, SEC rules and such other factors as it deemsregulations and the advice of counsel, if necessary. The Nominating and Corporate Governance Committee conducts any appropriate givenand necessary inquiries into the current needsbackgrounds and qualifications of potential director candidates. The Nominating and Corporate Governance Committee meets to discuss and consider the Boardcandidates’ qualifications and Atara,ultimately recommend director nominees to maintain a balance of knowledge, experience and capability.  the Board.

In the case of incumbent directors whose terms of office are set to expire, the Nominating and Corporate Governance Committee reviews these directors’ overall service to Atara during their terms, including the number of meetings attended, level of participation, quality of performance and any other relationships and transactions that might impair the directors’ independence.  In the case of new director candidates, the Nominating and Corporate Governance Committee also determines whether the nominee is independent for Nasdaq purposes, which determination is based upon applicable Nasdaq listing standards, applicable SEC rules and regulations and the advice of counsel, if necessary.  The Nominating and Corporate Governance Committee then uses its network of contacts to compile a list of potential candidates, but may also engage, if it deems appropriate, a professional search firm.  The Nominating and Corporate Governance Committee conducts any appropriate and necessary inquiries into the backgrounds and qualifications of possible candidates after considering the function and needs of the Board.  The Nominating and Corporate Governance Committee meets to discuss and consider the candidates’ qualifications and then selects a nominee for recommendation to the Board by majority vote.

The Nominating and Corporate Governance Committee will consider director candidates recommended by stockholders. The Nominating and Corporate Governance Committee does not intend to alter the manner in which it evaluates candidates, including the minimum criteria set forth above, based on whether or not the candidate was recommended by a stockholder. Stockholders who wish to recommend individuals for consideration by the Nominating and Corporate Governance Committee to become nominees for election to the Board may do so by delivering a written recommendation to the Nominating and Corporate Governance Committee at the following address: 611 Gateway Blvd., Suite 900, South San Francisco, CA 94080 not less than six months prior to any meeting at which directors are to be elected. Submissions must include the full name of the proposed nominee, a description of the proposed nominee’s business experience for at least the previous five years, complete biographical information, a description of the proposed nominee’s qualifications as a director and a representation that the nominating stockholder is a beneficial or record holder of our common stock and has been a holder for at least one year. Any such submission must be accompanied by the written consent of the proposed nominee to be named as a nominee and to serve as a director if elected.

Research and Development Committee

The Research and Development Committee provides advice and support to the Company in relation to the Company’s research and development activities and strategy.  The primary function of this committee is to confer with the Chief Executive Officer and the Company’s research and development leadership team regarding:

The Board has adopted a written Research and Development Committee charter that is available to stockholders on our website at http://investors.atarabio.com/corporate-governance.

Stockholder Communications with the Board

The Board has adopted a formal process by which stockholders may communicate with the Board or any of its directors. This information is available on our website at http://investors.atarabio.com/corporate-governance.cfm.corporate-governance. Any interested person may however,also communicate directly with the presiding lead directorchair of the Board or the independent or non-managementnon-employee directors. Persons interested in communicating directly with the independent or non-managementnon-employee directors regarding their concerns or issues are referred to the procedures for such communications on our website at http://investors.atarabio.com/contactboard.cfm.contact-board.

Code of Conduct

The Board has adopted a code of conduct that applies to all of our corporate employees, officers and directors, including those officers and employees responsible for financial reporting. Our code of conduct is available on our website at http://investors.atarabio.com/corporate-governance.cfm.corporate-governance. We intend to disclose any amendments to this policy, or any waivers of its requirements, on our website or in public filings to the extent required by applicable SEC rules or exchange requirements.

Corporate Governance Guidelines

The Board has adopted Corporate Governance Guidelines to assure that the Board will have the necessary authority and practices in place to review and evaluate our business operations as needed and to make decisions that are independent of our management. The guidelines are also intended to align the interests of directors and management with those of our stockholders. The Corporate Governance Guidelines set forth the practices the Board intends to follow with respect to board composition and selection, board meetings and involvement of senior management, Chief Executive Officer performance evaluation and succession planning, and board committees and compensation. The Corporate Governance Guidelines also formalize the Board’s belief that a diversity of viewpoints, background, experience and other characteristics, such as race, gender, ethnicity, sexual orientation, culture and nationality, are an important part of its makeup, and that it actively seeks these characteristics in identifying director candidates.

Our Corporate Governance Guidelines are available on our website at http://investors.atarabio.com/corporate-governance.cfm.corporate-governance.

12Stock Ownership Guidelines

In December 2020, the Board approved Stock Ownership Guidelines for our directors and named executive officers to further align their financial interests with those of our stockholders, as well as promote sound corporate governance.  For a detailed description of our Stock Ownership Guidelines see “Other Compensation Policies and Guidelines – Stock Ownership Guidelines” below.

Hedging Policy

The Company’s policies prohibit all employees (including executive officers) and directors from engaging in short sales, transactions in put or call options, hedging transactions or similar inherently speculative transactions with respect to our stock at any time.

Clawback Policy

In December 2020, the Board adopted an Incentive Compensation Recoupment Policy (“Clawback Policy”). For a detailed description of our Clawback Policy see “Other Compensation Policies and Guidelines – Clawback Policy” below.

Environmental, Social and Governance

Our approach to Environmental, Social and Governance (“ESG”) factors is consistent with our mission and our corporate values.  We are committed to conducting our business in a safe and environmentally sustainable manner that promotes the health of our employees, our customers, our community and the environment.

Governance

We are committed to good corporate governance and to conduct our business in an ethical manner. We have adopted numerous policies and guidelines to facilitate legal and ethical conduct and to further align the interests of our employees and directors with our stockholders and other key stakeholders, including the patients we serve. For a detailed description of several of these policies and guidelines, see “Information Regarding the Board of Directors and Corporate Governance” above.  

Environmental Sustainability

We are committed to operating our facilities in an environmentally responsible way to reduce environmental impacts and protect our people, our business, the environment and the communities where we operate.  In light of the potential impact our business may have on the environment, we have set goals and adopted a number of internal policies and management systems designed to eliminate, reduce, or substitute hazardous materials and waste and reduce water and energy consumption.  For

example, our Thousand Oaks, CA manufacturing facility: (i) is LEED certified (LEED V.3 BD+C Certified Core & Shell); (ii) is California Energy Commission Title 24 compliant for building and interior improvements; and (iii) has equipment and systems in place designed to ensure operational and energy efficiency.  

Supplier Code of Conduct

We are committed to maintaining the highest standards of legal and ethical conduct and to reflect our corporate values of transparency, respect, accountability, integrity and trust (“TRAIT”).  We expect our suppliers to demonstrate a similar commitment to legal and ethical business practices.  In 2020, we developed and implemented the Atara Supplier Code of Conduct to convey our minimum expectations for our suppliers, and their respective subcontracts and suppliers, to: (i) operate in full compliance with all laws, rules and regulations; (ii) conduct business ethically and act with integrity; (iii) uphold the human rights of workers and to treat workers with dignity and respect; (iv) provide a safe and healthy working environment; and (v) operate in an environmentally responsible and efficient manner.

COVID-19 Response

During the COVID-19 pandemic, to support the health, safety and engagement of our staff and to ensure business continuity, we enacted numerous safeguards, such as: (i) reduction of on-site staff presence to essential activities and implemented remote work for non-essential activities; (ii) established engineering controls and business processes to reduce risk of on-site transition and preventing “super-spreader” events through physical distancing, enhanced cleaning and hygiene, and providing our staff with personal protective equipment; (iii) created an on-site COVID-19 monitoring program and an at-home testing program; and (iv) designed and executed a rapid and transparent communication and education strategy to ensure our staff has all relevant scientific data at the local, regional and national level.

In February 2020, we established a COVID-19 Rapid Response Team (“RRT”), sponsored by two Company executives, to assess and address business risks associated with the COVID-19 pandemic. The RRT created clear and regular communications channels, ensured enhanced cleaning and sanitation at our facilities, assessed the impact to our operations, donors, vendors, and clinical trial sites globally, as well as monitored peer companies’ approaches to apply best practices to our processes and decisions.

We have established a team tasked with creating a return-to-office plan to ensure staff safety and business continuity for the transition back to our offices and facilities. We intend to adopt several new work arrangement models to facilitate, where appropriate, workplace flexibility and to support our return-to-office plan safely and effectively. In addition to promoting productivity and efficiency, we believe these new work arrangement models will reduce the environmental impact of our business and operations.

Our continued efforts throughout the COVID-19 pandemic have reinforced our commitment to staff safety and serving patients by maintaining business continuity and executing on our commitment to develop transformative therapies for patients with serious diseases, including solid tumors, hematologic cancers and autoimmune diseases. We believe going above and beyond to mitigate the risk of COVID-19 to on-site staff and other stakeholders exemplifies our TRAIT values.  

TRAIT Values and Diversity

We have formalized a set of corporate values to guide us in how we conduct our business and execute our corporate strategy.  

Consistent with our TRAIT values, we believe a diverse and inclusive culture supports our ability to serve patients. We encourage all of our employees to participate in our diversity, inclusion and belonging initiatives to strengthen and grow our diverse and inclusive culture, which include educational webinars, cultural engagement events, fireside chats and a robust set of diversity, inclusion and belonging courses available through LinkedIn Learning.  We also have an employee resource group, the Atara Women’s Alliance, the mission of which is to strengthen the leadership, voices and impact of women and to create an inclusive environment where diverse viewpoints and backgrounds are valued.  In addition, our Board meets the current diversity requirements specified under California law and it is our expectation we will continue to meet such requirements in future periods.     

Employee Engagement

We conduct employee feedback surveys on a regular basis that are designed to help us measure overall employee engagement. These surveys help us assess our culture and the feedback helps us in building a great company to work for and provides important insight into the areas we may need to focus on.  The surveys will continue to be leveraged to support measuring our progress on the Company’s important initiatives and adherence to our TRAIT values.

PROPOSAL 2

Advisory Vote on Executive Compensation

Under the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), and Section 14A of the Exchange Act, the Company’s stockholders are entitled to vote to approve, on an advisory basis, the compensation of the Company’s named executive officers as disclosed in this Proxy Statement in accordance with SEC rules.

This vote is not intended to address any specific item of compensation, but rather the overall compensation of the Company’s named executive officers and the philosophy, policies and practices described in this Proxy Statement. The compensation of the Company’s named executive officers subject to the vote is disclosed in the Compensation Discussion and Analysis, the compensation tables, and the related narrative disclosure contained in this Proxy Statement. As discussed in those disclosures, the Company believes that its compensation policies and decisions are designed to meet two objectives: (i) to attract and retain talented and skilled executives by paying for performance; and (ii) to align compensation of our executives with our stockholders through an appropriate mix of short-term and long-term compensation. Compensation of the Company’s named executive officers is designed to enable the Company to attract and retain talented and experienced executives to lead the Company successfully in a competitive environment.

Accordingly, the Board is asking the stockholders to indicate their support for the compensation of the Company’s named executive officers as described in this Proxy Statement by casting a non-binding advisory vote “FOR” the following resolution:

“RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and narrative discussion that accompanies the compensation tables, is hereby APPROVED.”

Because the vote is advisory, it is not binding on the Board or the Company. Nevertheless, the views expressed by the stockholders, whether through this vote or otherwise, are important to the Board and the Compensation Committee, and accordingly the Board and the Compensation Committee intend to consider the results of this vote in making determinations in the future regarding executive compensation arrangements.

Advisory approval of this proposal requires the vote of the holders of a majority of the shares present in person, present by remote communications, if applicable, or represented by proxy and entitled to vote on the matter at the annual meeting. Unless the Board decides to modify its policy regarding the frequency of soliciting advisory votes on the compensation of the Company’s named executives, the next scheduled say-on-pay vote will be at the 2022 Annual Meeting of Stockholders.

The Board Of Directors Recommends

A Vote In Favor Of Proposal 2

PROPOSAL 3

RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Audit Committee has selected Deloitte & Touche LLP (“Deloitte & Touche”) as our independent registered public accounting firm for the fiscal year ending December 31, 20162021 and has further directed that management submit the selection of its independent registered public accounting firm for ratification by the stockholders at the annual meeting.Annual Meeting. Deloitte & Touche has audited our financial statements since our inception in 2012. Representatives of Deloitte & Touche are expected to be present at the annual meeting.Annual Meeting. They will have an opportunity to make a statement if they so desire and will be available to respond to appropriate questions.

Neither our Bylaws nor other governing documents or law require stockholder ratification of the selection of Deloitte & Touche as our independent registered public accounting firm. However, the Audit Committee is submitting the selection of Deloitte & Touche to the stockholders for ratification as a matter of good corporate practice. If the stockholders fail to ratify the selection, the Audit Committee will reconsider whether or not to retain that firm. Even if the selection is ratified, the Audit Committee in its discretion may direct the appointment of different independent auditors at any time during the year if they determine that such a change would be in the best interests of Atara and our stockholders.

The affirmative vote of the holders of a majority of the shares present in person, present by remote communications, if applicable, or represented by proxy and entitled to vote on the matter at the annual meetingAnnual Meeting will be required to ratify the selection of Deloitte & Touche.

Principal Accountant Fees and Services

The following table represents aggregate fees billed to us for 20152020 and 20142019 by Deloitte & Touche.

Audit Fees.

All fees described above were pre-approved by the Audit Committee.

Pre-Approval Policies and Procedures

The Audit Committee has adopted a policy and procedures for the pre-approval of audit and non-audit services rendered by Deloitte & Touche. The policy generally pre-approves specified services in the defined categories of audit services, audit-related services and tax services up to specified amounts. Pre-approval may also be given as part of the Audit Committee’s approval of the scope of the engagement of the independent auditor or on an individual, explicit, case-by-case basis before the independent auditor is engaged to provide each service. The pre-approval of services may be delegated to one or more of the Audit Committee’s members, but the decision must be reported to the full Audit Committee at its next scheduled meeting.

The Audit Committee has determined that the rendering of services other than audit services by Deloitte & Touche is compatible with maintaining the principal accountant’s independence.

THE BOARD OF DIRECTORS RECOMMENDS

A VOTE IN FAVOR OF PROPOSAL 2.3

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PROPOSAL 3

Approval of the amended and restated 2014 Equity Incentive PLan

General

We are asking our stockholders to approve the 2014 Equity Incentive Plan, as amended and restated (which we refer to as the 2014 EIP) in order to increase the number of authorized shares available under the 2014 EIP and update the 2014 EIP to reflect certain practices generally requested by stockholders in today’s market.  The current terms of the 2014 EIP are identical to the terms of the plan that stockholders approved on June 2, 2014.

Background for Proposal

Increase Maximum Number of Authorized Shares:  The 2014 EIP sets forth a maximum number of shares authorized for issuance under the 2014 EIP.  We are asking stockholders to approve an increase in the maximum number of authorized shares.  Specifically, the Board is requesting that stockholders approve increasing each of these authorizations by 4,000,000 shares. These 4,000,000 shares represent 14% of our outstanding shares of common stock as of March 31, 2016.  If approved by stockholders, the number of additional shares authorized for issuance under the 2014 EIP may all be issued pursuant to restricted stock units or restricted stock awards, which may result in greater dilution than if such shares were subject to stock options or stock appreciation rights granted under the 2014 EIP.

Equity Plan Share Reservation

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Section 162(m) Re-Approval:  The 2014 EIP is being submitted to our stockholders to ensure that certain awards granted under the 2014 EIP that are intended to qualify as “performance-based compensation” under Section 162(m) of the Code may so qualify.  Generally, Section 162(m) does not permit a tax deduction for compensation in excess of $1 million paid in any calendar year by a publicly held company to its chief executive officer or any of the three other most highly compensated executive officers (other than the principal financial officer).  However, certain compensation, including compensation based on the attainment of performance goals, is excluded from this deduction limit if certain criteria are satisfied, including that the material terms pursuant to which the compensation is to be paid is disclosed to and approved by the company’s stockholders. Accordingly, if the 2014 EIP, including the list of performance criteria applicable under the 2014 EIP for awards intended to qualify as performance-based under Section 162(m), is approved by stockholders and other conditions of Section 162(m) are satisfied, certain compensation paid to the above individuals pursuant to the 2014 EIP should not be subject to the deduction limit of Section 162(m).  Because of the fact-based nature of the performance-based compensation exception under Section 162(m) and the limited availability of formal guidance thereunder, we cannot guarantee that any awards under the 2014 EIP intended to qualify for exemption under Section 162(m) will actually receive this treatment.  However, the 2014 EIP is structured with the intention that our Compensation Committee will have the discretion to make awards under the 2014 EIP that would qualify as “performance-based compensation” and be fully deductible.  At the annual meeting, our stockholders are being requested to further qualify the 2014 EIP for purposes of Section 162(m), including re-approval of the performance criteria applicable under the 2014 EIP for awards intended to qualify as performance-based compensation under Section 162(m).

Background of Equity Compensation at Atara

Atara grants equity awards to more than 90% of our employees annually in the first quarter of the year.  In 2015, we granted equity awards covering 2.7 million shares under the 2014 EIP, of which awards for 0.7 million shares, or 26.1%, were granted to our listed officers; awards for 0.1 million shares, or 5.4%, were granted to our non-employee directors and consultants; and awards for 1.9 million shares, or 68.5%, were granted to our broad-based employee population.  Generally, the company grants a mix of options to purchase common stock and restricted stock units to all our employees.  The intention of equity awards is to incentivize employees. Because of volatility in the biotherapeutics market, we believe restricted stock units are an important component of our equity compensation as they address this volatility and ensure our employees remain incentivized.

As noted above, the potential dilution from the 4,000,000 share increase requested to be approved by stockholders is 13.9%, based on the total common shares outstanding as of March 31, 2016.  Since the 2014 EIP was put into effect, the average annual dilution was 5.8%.  We manage our long-term dilution goal by limiting the number of shares subject to equity awards that we grant annually, commonly referred to as burn rate.  Burn rate is another measure of dilution that shows how rapidly a company is depleting its shares reserved for equity compensation plans, and differs from annual dilution because it does not take into account cancellations.  Since the 2014 EIP was put into effect, our annual burn rate has averaged 6.3%.  For this purpose, we are calculating both dilution and burn rate based upon total common shares outstanding at the end of the year, to align more closely with industry practice.

An additional metric that we use to measure the cumulative impact of the 2014 EIP is overhang (number of shares subject to equity awards outstanding but not exercised, plus number of shares available to be granted, divided by total common shares outstanding at the end of the year).  Since the 2014 EIP was put into effect, our overhang has averaged 15.2%.  If the amendment of the 2014 EIP is approved, our overhang would increase to 32.4%.

Equity Compensation Plan Key Metrics

*  Partial year, January 1, 2016 – March 31, 2016

** Partial Year, March 31, 2014 – December 31, 2014

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In considering the proposed amendments to the 2014 EIP, the Compensation Committee was presented with information on Atara’s historical dilution, burn rate, and overhang.  In addition, the Compensation Committee considered the development timelines for our lead product candidate, Epstein Bar Virus cytotoxic T-lymphocyte for post-transplant lymphoproliferative disorder, or EBV-CTL for PTLD, after hematopoetic cell transplant, or HCT, or solid organ transplant, or SOT.  Because the EBV-CTL for PTLD received breakthrough therapy designation from the U.S. Food and Drug Administration, or FDA, and the European Medicines Agency, or EMA, the early access program is expected to begin in the first half of 2016 and the pivotal trials for the HCT and SOT indications are expected to commence in late 2016.  Due to this accelerated development timeline, if EBV-CTL is approved by the FDA or EMA, it is possible that our EBV-CTL product could be commercialized within the next three years.  Commercialization of a drug in the U.S. or Europe requires additional resources and infrastructure.  In order to be in a position to build the infrastructure and resources needed to launch an approved product, our organization will need to grow in a short time frame.  This growth will include expansion of existing departments as well as the creation and growth of new departments, including a medical affairs department and a commercial department.  The Compensation Committee considered this fast expansion in headcount when evaluating the proposed amendment to the 2014 EIP.  Taking into account Atara’s broad-based equity grant practices and the foregoing information, Atara believes that the additional share authorization requested is appropriate to support the expected growth of the organization.

2014 EIP Description

Administration:  Under the terms of the 2014 EIP, the Board of Directors (and, through delegation, the Compensation Committee) has the power (i) to determine who will be granted Awards (as defined in the 2014 EIP); when and how each Award will be granted; what type of Award will be granted; the provisions of each Award; the number of shares of Common Stock (as defined in the 2014 EIP) subject to, or the cash value of, an Award; and the fair market value applicable to a stock award; (ii) to construe and interpret the 2014 EIP and awards granted under it, and to establish, amend and revoke rules and regulations for administration of the 2014 EIP and awards; (iii) to settle all controversies regarding the 2014 EIP and awards granted under it; (iv) in corporate transactions and change of control situations, to accelerate, in whole or in part, the time at which an award may be exercised or vest (or at which cash or shares of Common Stock may be issued); (v) to suspend or terminate the 2014 EIP at any time; provided that such action generally does not materially impair a participant’s rights under his or her then-outstanding award without his or her written consent; (vi) to amend the 2014 EIP in any respect the Board of Directors deems necessary or advisable, including, without limitation, adopting amendments relating to incentive stock options and nonqualified deferred compensation under Section 409A of the Code (as defined in the 2014 EIP) and/or making the 2014 EIP or awards granted under the 2014 EIP exempt from or compliant with the requirements for incentive stock options or exempt from or compliant with the requirements for nonqualified deferred compensation under Section 409A of the Code, subject to the limitations, if any, of applicable law; (vii) to submit any amendment to the 2014 EIP for stockholder approval, including, but not limited to, amendments to the 2014 EIP intended to satisfy the requirements of (A) Section 162(m) of the Code regarding the exclusion of performance-based compensation from the limit on corporate deductibility of compensation paid to “Covered Employees,” (B) Section 422 of the Code regarding incentive stock options or (C) Rule 16b-3 of U.S. Securities Exchange Act of 1934 or any successor rule; (viii) to approve forms of award agreements for use under the 2014 EIP and to amend the terms of any one or more outstanding awards; (ix) generally, to exercise such powers and to perform such acts as the Board of Directors deems necessary or expedient to promote the best interests of the Company and that are not in conflict with the provisions of the 2014 EIP and/or award agreements; (x) to adopt such procedures and sub-plans as are necessary or appropriate (A) to permit or facilitate participation in the 2014 EIP by participants who are foreign nationals or employed outside the United States or (B) allow awards to qualify for special tax treatment in a foreign jurisdiction; provided that Board of Director approval will not be necessary for immaterial modifications to the 2014 EIP or any award agreement that are required for compliance with the laws of the relevant foreign jurisdiction; and (xi) to effect, with the consent of any adversely affected participant, (A) the reduction of the exercise, purchase or strike price of any outstanding stock award; (B) the cancellation of any outstanding stock award and the grant in substitution therefore of a new (1) stock option or stock appreciation right, (2) restricted stock award, (3) restricted stock unit award, (4) other stock award, (5) cash award and/or (6) award of other valuable consideration determined by the Board of Directors, in its sole discretion, with any such substituted award covering the same or a different number of shares of Common Stock as the cancelled stock award and granted under the 2014 EIP or another equity or compensatory plan of the Company; or (C) any other action that is treated as a repricing under generally accepted accounting principles.

Ability to Permit Deferrals:  Under the terms of the 2014 EIP, to the extent permitted by applicable law, the Board of Directors, in its sole discretion, may determine that the delivery of Common Stock or the payment of cash, upon the exercise, vesting or settlement of all or a portion of any award may be deferred and may establish programs and procedures for deferral elections to be made by participants.  Deferrals by participants will be made in accordance with Section 409A of the Code (to the extent applicable to a participant).  Consistent with Section 409A of the Code, the Board of Directors may provide for distributions while a participant is still an employee or otherwise providing services to the Company.  The Board of Directors is authorized to make deferrals of awards and determine when, and in what annual percentages participants may receive payments, including lump sum payments, following the participant’s termination of continuous service, and implement such other terms and conditions consistent with the provisions of the 2014 EIP and in accordance with applicable law.

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Adjustments Upon Changes in Control in Common Stock; Other Corporate Events:  Under the terms of the 2014 EIP, in the event of a capitalization adjustment, the Board of Directors will appropriately and proportionately adjust the classes and maximum number of securities subject to the 2014 EIP, including the price per share of stock subject to outstanding stock awards as applicable.  Except as otherwise provided in the stock award agreement, in the event of a dissolution or liquidation of the Company, all outstanding stock awards (other than stock awards consisting of vested and outstanding shares of Common Stock not subject to a forfeiture condition or the Company’s right of repurchase) will terminate immediately prior to the completion of such dissolution or liquidation, and the shares of Common Stock subject to the Company’s repurchase rights or subject to a forfeiture condition may be repurchased or reacquired by the Company notwithstanding the fact that the holder of such stock award is providing continuous service; provided, however, that the Board of Directors may, in its sole discretion, cause some or all stock awards to become fully vested, exercisable and/or no longer subject to repurchase or forfeiture (to the extent such stock awards have not previously expired or terminated) before the dissolution or liquidation is completed but contingent on its completion.  In the event of a “Corporate Transaction” (as defined in the 2014 EIP and summarized below under the heading “Corporate Transactions”), the Board of Directors will take one or more of the following actions with respect to stock awards, contingent upon the closing or completion of the Corporate Transaction:  (i) arrange for the surviving corporation or acquiring corporation (or the surviving or acquiring corporation’s parent company) to assume or continue the stock award or to substitute a similar stock award for the stock award (including, but not limited to, an award to acquire the same consideration paid to the stockholders of the Company pursuant to the Corporate Transaction); (ii) arrange for the assignment of any reacquisition or repurchase rights held by the Company in respect of Common Stock issued pursuant to the stock award to the surviving corporation or acquiring corporation (or the surviving or acquiring corporation’s parent company); (iii) accelerate the vesting of the stock award (and, if applicable, the time at which the stock award may be exercised) to a date prior to the effective time of such Corporate Transaction as the Board of Directors will determine (or, if the Board of Directors will not determine such a date, to the date that is 5 days prior to the effective date of the Corporate Transaction), with such stock award terminating if not exercised (if applicable) at or prior to the effective time of the Corporate Transaction; (iv) arrange for the lapse, in whole or in part, of any reacquisition or repurchase rights held by the Company with respect to the stock award; (v) cancel or arrange for the cancellation of the stock award, to the extent not vested or not exercised prior to the effective time of the Corporate Transaction, in exchange for such cash consideration, if any, as the Board, in its sole discretion, may consider appropriate; and (vi) cancel or arrange for the cancellation of the stock award in exchange for a payment in such form as may be determined by the Board of Directors equal to the excess, if any, of (A) the value of the property the participant would have received upon the exercise of the stock award immediately prior to the effective time of the Corporate Transaction, over (B) any exercise price payable by such holder in connection with such exercise.  In the absence of any affirmative determination by the Board of Directors at the time of a Corporate Transaction, each outstanding stock award will be assumed or an equivalent stock award will be substituted by such successor corporation or a parent or subsidiary of such successor corporation, unless the successor corporation does not agree to assume the stock award or to substitute an equivalent stock award, in which case such stock award will terminate upon the consummation of the transaction.  In the event of a “Change in Control” (as defined in the 2014 EIP), a stock award may be subject to additional acceleration of vesting and exercisability upon or after a Change in Control as may be provided in the stock award agreement for such stock award or as may be provided in any other written agreement between the Company or any affiliate and the participant, but in the absence of such provision, no such acceleration will occur.

Awards and Eligibility:    The 2014 EIP provides for the grant of stock options, stock appreciation rights restricted stock awards, restricted stock unit awards, performance stock awards, performance cash awards, and other stock awards.  All employees of the Company (approximately 60 people), consultants of the Company (approximately 14 people) and non-employee directors of the Company (currently six people) are eligible to participate in the 2014 EIP.  The persons to whom awards will be granted and the terms thereof are determined by the Compensation Committee.  The bases on which individuals receive actual awards will depend on a number of factors, including an individual’s potential contribution to the business, compensation practices at the time, retention issues and the Company’s stock price.  

Shares Available:     836,815 shares remain available for the grant of awards under the 2014 EIP as of March 31, 2016 and the closing per-share sales price of our Common Stock on that date as reported on Nasdaq was $19.03.  If an award (or any portion of an award) under the 2014 EIP (i) expires or otherwise terminates without all of the shares covered by the award having been issued or (ii) is settled in cash (i.e., the participant receives cash rather than stock), such expiration, termination or settlement does not reduce (or otherwise offset) the number of shares that are available for issuance under the 2014 EIP.  If any shares issued under an award are forfeited back to or repurchased by the Company because of the failure to meet a contingency or condition required to vest such shares, then the shares that are forfeited or repurchased will revert to and again become available for issuance under the 2014 EIP.  Any shares reacquired by the Company in satisfaction of tax withholding obligations on an award or as consideration for the exercise or purchase price of an award will again become available for issuance under the 2014 EIP.

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Maximum Grants under the 2014 EIP:    At such time as the Company is subject to limitations under Section 162(m) of the Code, (a) a maximum of 3,000,000 shares of Common Stock subject to stock options, stock appreciation rights and similarly structured other stock awards may be granted to any one participant during any one calendar year; (b) no individual may be granted greater than 3,000,000 shares of Common Stock subject to Performance Stock Awards during any one calendar year (whether the grant, vesting or exercise is contingent upon the attainment during the performance period of the performance goals); and (c) a maximum of $2,000,000 may be granted as a performance cash award to any one participant during any one calendar year.

Director Limitation:    We are asking stockholders to approve an amendment that would add annual maximum limitations to awards to our non-employee directors.  Under this amendment, the maximum number of shares subject to awards granted during a single fiscal year to any non-employee director under the plan and under any other Company equity plan, taken together with any cash fees paid to such non-employee director during the fiscal year, would not exceed $1,500,000 in total value (calculating the value of any such awards based on the grant date fair value of such awards for financial reporting purposes and excluding, for this purpose, the value of any dividend equivalent payments paid pursuant to any award granted in a previous fiscal year).

Performance Goals:    Unless otherwise permitted in compliance with the requirements of Section 162(m) of the Code with respect to an award intended to qualify as “performance-based compensation” thereunder, the Compensation Committee will establish the performance goals applicable to, and the formula for calculating the amount payable under, performance-based awards no later than the earlier of (a) the date 90 days after the commencement of the applicable performance period, and (b) the date on which 25% of the performance period has elapsed, and in any event at a time when the achievement of the applicable performance goals remains substantially uncertain.  Prior to the payment of any compensation under an award intended to qualify as “performance-based compensation” under Section 162(m) of the Code, the Compensation Committee will certify in writing the extent to which any performance goals and any other material terms under such award have been satisfied (other than in cases where such relate solely to the increase in the value of the Common Stock).  Notwithstanding satisfaction of any completion of any performance goals, the number of shares of Common Stock, stock options, cash or other benefits granted, issued, retainable and/or vested under an award on account of satisfaction of such performance goals may be reduced by the Compensation Committee on the basis of such further considerations as the Compensation Committee, in its sole discretion, will determine.

Options and Stock Appreciation Rights:  Options to purchase shares of Common Stock and stock appreciation rights each may be granted under the 2014 EIP, either alone or in addition to other awards, in consideration (in whole or in part) for the performance of services.  The exercise price per share may not be less than the closing sales price per share as reported on the Nasdaq on the date of grant.  The term of each stock option and stock appreciation right is fixed by the Compensation Committee in its sole discretion, but no stock option or stock appreciation right may be exercised more than ten years after the date the option is granted.  Stock options and stock appreciation rights are exercisable at such time or times as determined by the Compensation Committee.  Subject to the other provisions of the 2014 EIP and any applicable award agreement, any stock option may be exercised by the participant upon payment by delivery of cash, shares of Common Stock or by any combination thereof.  To exercise any outstanding stock appreciation right, the participant must provide written notice of exercise to the Company in compliance with the provisions of the stock appreciation right agreement evidencing such stock appreciation right.  The appreciation distribution payable on the exercise of a stock appreciation right will be not greater than an amount equal to the excess of (A) the aggregate fair market value (on the date of the exercise of the stock appreciation right) of a number of shares of Common Stock equal to the number of Common Stock equivalents in which the participant is vested under such stock appreciation right (with respect to which the participant is exercising the stock appreciation right on such date), over (B) the aggregate strike price of the number of Common Stock equivalents with respect to which the participant is exercising the stock appreciation right on such date.  The appreciation distribution may be paid in Common Stock, in cash, in any combination of the two or in any other form of consideration, as determined by the Compensation Committee and contained in the award agreement evidencing such stock appreciation right.  In general, if a participant’s employment or service as a director terminates, other than by reason of retirement, death or disability, all of the participant’s unexercisable options and stock appreciation rights are forfeited and all exercisable options and stock appreciation rights may be exercised within 3 months following termination or they will expire.  In the event of termination because of death or disability, all of the participant’s unexercisable options and stock appreciation rights are forfeited and all exercisable options may be exercised within 18 or 12 months following termination because of death or disability, respectively, or they will expire.

Restricted Stock:    Restricted stock awards may be issued to participants for (a) cash, check, bank draft or money order payable to the Company, (b) past services to the Company or an affiliate, or (c) any other form of legal consideration (including future services) permissible under applicable law, either alone or in addition to other awards granted under the 2014 EIP. Shares of Common Stock awarded under a restricted stock award agreement may be subject to forfeiture to the Company in accordance with a vesting schedule to be determined by the Compensation Committee.

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Performance Stock Awards:  The Compensation Committee may grant performance stock awards under the 2014 EIP.  A performance stock award is a stock award payable contingent upon the attainment during a performance period of certain performance goals.  A performance stock award may, but need not, require the completion of a specified period of continuous service.  The length of any performance period, the performance goals to be achieved during the performance period, and the measure of whether and to what degree such performance goals have been attained will be conclusively determined by the Board of Directors or the Compensation Committee in their sole discretion.  To the extent permitted by applicable law and the applicable award agreement, the Compensation Committee may determine that cash may be used in payment of performance stock awards.

Performance Cash Awards:  The Compensation Committee may grant performance cash awards under the 2014 EIP.  A performance cash award is a cash award payable contingent upon the attainment during a performance period of certain performance goals.  A performance cash award may also require the completion of a specified period of continuous service.  At the time of grant of a performance cash award, the length of any performance period, the performance goals to be achieved during the performance period, and the measure of whether and to what degree such performance goals have been attained will be conclusively determined by the Board of Directors or the Compensation Committee in their sole discretion.  The Compensation Committee may specify the form of payment of performance cash awards, which may be cash or other property, or may provide for a participant to have the option for his or her performance cash award, or such portion thereof as the Compensation Committee may specify, to be paid in whole or in part in cash or other property.

Restricted Stock Units:  Restricted stock unit awards may be issued to participants for consideration, if any, to be paid by the participant upon delivery of each share of Common Stock subject to the restricted stock unit award as the Compensation Committee may determine.  The consideration to be paid (if any) by the participant for each share of Common Stock subject to a restricted stock unit award may be paid in any form of legal consideration that may be acceptable to the Compensation Committee, in its sole discretion, and permissible under applicable law.  At the time of the grant of a restricted stock unit award, the Compensation Committee may impose such restrictions on or conditions to the vesting of the restricted stock unit award as it, in its sole discretion, deems appropriate.

Other Stock Awards:    Other awards of shares and other awards that are valued in whole or in part by reference to, or are otherwise based on, shares may be granted to participants, either alone or in addition to other awards granted under the 2014 EIP, and may include awards based on the achievement of pre-established performance criteria during a specified period.  Other stock unit awards may be paid in shares of Common Stock, cash or any other form of property as the Compensation Committee determines.

Corporate Transactions:  In the event of a Corporate Transaction, the Compensation Committee shall have discretion to accelerate the vesting of awards, eliminate restrictions, deem any performance measure to be satisfied or take such other action as it deems appropriate in its sole discretion.  A Corporate Transaction shall occur upon (a) a sale or other disposition of all or substantially all, as determined by the Compensation Committee in its sole discretion, of the consolidated assets of the Company and any subsidiaries; (b) a sale or other disposition of at least 90% of the outstanding securities of the Company; (c) a merger, consolidation or similar transaction following which the Company is not the surviving corporation; or (d) a merger, consolidation or similar transaction following which the Company is the surviving corporation but the shares of Common Stock outstanding immediately preceding the merger, consolidation or similar transaction are converted or exchanged by virtue of the merger, consolidation or similar transaction into other property, whether in the form of securities, cash or otherwise.  For additional description of additional potential treatments of awards in a Corporate Transaction, see the discussion under the “Adjustments Upon Changes in Control in Common Stock; Other Corporate Events” heading above.

Other Provisions:    The Compensation Committee may amend, suspend or discontinue the 2014 EIP at any time, but no amendment, alteration or discontinuation may be made that would impair rights under an award previously granted without the participant’s consent.  The Compensation Committee may not, without shareholder approval, amend the 2014 EIP to increase the aggregate number of shares that may be issued or transferred to participants or to any one participant, extend the term of the 2014 EIP or awards granted thereunder, change the eligibility criteria for participants or grant options at less than fair market value.  The 2014 EIP will expire on March 31, 2024, and no awards may be made under the 2014 EIP after such date.

The Compensation Committee is authorized to make adjustments in performance award criteria or in the terms and conditions of other awards in recognition of unusual or nonrecurring events affecting the Company or its financial statements or changes in applicable laws, regulations or accounting principles. The 2014 EIP contains an anti-dilution provision that provides for the adjustment of the number of shares available for the grant of stock awards and certain limits under the 2014 EIP in the event of a merger, consolidation, reorganization, recapitalization, reincorporation, stock dividend, dividend in property other than cash, large nonrecurring cash dividend, stock split, liquidating dividend, combination of shares, exchange of shares, change in corporate structure or other similar equity restructuring transaction.

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The foregoing summary of the material terms of the 2014 EIP is qualified in its entirety by reference to the text of the 2014 EIP, which is attached as Appendix A to this proxy statement.

Tax Consequences

The following is a brief summary of certain federal income tax consequences of certain transactions under the 2014 EIP based on federal income tax laws in effect on the date hereof. This summary is not intended to be exhaustive and does not describe state or local tax consequences.

In general, (i) no income will be recognized by an optionee at the time a nonqualified option is granted, (ii) at the time of exercise of a nonqualified option, ordinary income will be recognized by the optionee in an amount equal to the difference between the purchase price paid for the shares and the fair market value of the shares if they are non-restricted on the date of exercise and (iii) at the time of sale of shares acquired pursuant to the exercise of a nonqualified option, any appreciation (or depreciation) in the value of the shares after the date of exercise will be treated as either short-term or long-term capital gain (or loss) depending on how long the shares have been held.  No income generally will be recognized by an optionee upon the grant or qualifying exercise of an incentive stock option. However, for purposes of calculating the optionee’s alternative minimum tax, if any, the difference between the fair market value of the shares at exercise and the purchase price generally constitutes an item of adjustment.  If shares are issued to an optionee pursuant to the exercise of an incentive stock option and no disqualifying disposition of the shares is made by the optionee within two years after the date of grant or within one year after the transfer of the shares to the optionee, then upon the sale of the shares, any gain realized will be taxed to the optionee as long-term capital gain and any loss sustained will be a long-term capital loss.  If shares acquired upon the exercise of an incentive stock option are disposed of prior to the expiration of either holding period described above, the optionee generally will recognize ordinary income in the year of disposition in an amount equal to any excess of the fair market value of the shares at the time of exercise (or, if less, the amount realized on the disposition of the shares in a sale or exchange) over the purchase price paid for the shares. Any further gain (or loss) realized by the optionee generally will be taxed as short-term or long-term gain (or loss) depending on the holding period.

A recipient of a restricted stock award generally will be subject to tax at ordinary income rates on the fair market value of the restricted shares, reduced by any amount paid for the shares by the recipient, at such time as the shares are no longer subject to a substantial risk of forfeiture or restrictions on transfer for purposes of Section 83 of the Code.  However, a recipient who properly elects under Section 83(b) of the Code within 30 days of the date of transfer of the shares to the recipient will have taxable ordinary income on the date of transfer of the shares equal to the excess of the fair market value of the shares (determined without regard to the risk of forfeiture or restrictions on transfer) over any purchase price paid for the shares.  If a Section 83(b) election has not been made, any dividends received with respect to restricted shares that are subject at that time to a substantial risk of forfeiture and restrictions on transfer generally will be treated as compensation that is taxable as ordinary income to the recipient.

Generally, no income will be recognized by a participant in connection with the grant of a stock unit award.  Subject to the specific terms of the award, when the award is paid to the participant, the participant normally will be required to include as taxable ordinary income in the year of payment an amount equal to the amount of any cash and the fair market value of any non-restricted shares of Common Stock actually or constructively received.

To the extent that a participant recognizes ordinary income in the circumstances described above, the Company will be entitled to a corresponding deduction provided that, among other things, (i) the income meets the test of reasonableness, is an ordinary and necessary business expense and is not an “excess parachute payment” within the meaning of Section 280G of the Code and is not disallowed by the $1 million limitation under Section 162(m) and (ii) any applicable reporting obligations are satisfied.

Section 409A of the Code is applicable to certain types of awards that may be granted under the 2014 EIP. To the extent applicable, it is intended that the 2014 EIP and any grants made under the 2014 EIP comply with the provisions of Section 409A.  The Company intends to administer the 2014 EIP and any grants made thereunder in a manner consistent with the requirements of Section 409A, and to adopt such amendments (including retroactive amendments) to the 2014 EIP and any grants made thereunder as may be required in order to comply with Section 409A.

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New Plan Benefits

Awards under the 2014 EIP are within the discretion of the Compensation Committee.  As a result, the benefits that will be awarded under the 2014 EIP, including to our non-employee directors, are not determinable at this time and, therefore the table below shows the aggregate number and value of awards granted under the 2014 EIP during 2015.

History of Grants under the 2014 EIP

From the inception of the 2014 EIP through March 31, 2016, 269,230 shares of restricted stock were granted under the 2014 EIP; 3,561,933 options were granted under the 2014 EIP, 25,066 of which have been exercised, 106,385 of which have been cancelled and 3,430,482 of which remain outstanding as of March 31, 2016; 1,899,178 restricted stock units were granted under the 2014 EIP of which 1,031,521 remain outstanding as of March 31, 2016.  The following table summarizes the grants made to our named executive officers, all current executive officers as a group, all current directors who are not executive officers as a group, each nominee for election as a director, each associate of any director, executive officer or nominee, each other person who received or are to receive 5% of such options, restricted stock or restricted stock units as a group, and all employees, excluding current executive officers, as a group, from the inception of the 2014 EIP through March 31, 2016.  

Certain Interests of Directors

In considering the recommendation of our Board of Directors with respect to the approval of the 2014 EIP, stockholders should be aware that members of our Board of Directors have certain interests, which may present them with conflicts of interest in connection with this proposal.  As discussed above, directors are eligible to receive awards under the 2014 EIP.  For more information about the compensation we pay to our directors, see “Non-Employee Director Compensation” on Page 34.  Our Board of Directors recognizes that approval of this proposal may benefit our directors and their successors.

Information About Other Equity Compensation Plans

Reference is made to that certain information set forth in the section entitled “Equity Compensation Plan Information” on page 36 of this proxy statement.

Vote Required

Approval of the 2014 EIP requires the affirmative vote of a majority of the votes cast on the proposal at the annual meeting.  

THE BOARD OF DIRECTORS RECOMMENDS

A VOTE IN FAVOR OF PROPOSAL 3.

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SECURITY OWNERSHIP OF

CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth, as of March 31, 2016,2021, information regarding beneficial ownership of our common stock by:

Unless otherwise indicated, the address of each beneficial owner listed in the table below is c/o Atara Biotherapeutics, Inc., 611 Gateway Blvd., Suite 900, South San Francisco, CA 94080.²

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Johnson, are the predominant owners, directly or through trusts, of Series B voting common shares of FMR LLC, representing 49% of the voting power of FMR LLC. The Johnson family group and all other Series B shareholders have entered into a shareholders’ voting agreement under which all Series B voting common shares will be voted in accordance with the majority vote of Series B voting common shares. Accordingly, through their ownership of voting common shares and the execution of the shareholders’ voting agreement, members of the Johnson family may be deemed, under the Investment Company Act of 1940, as amended (the “Investment Company Act”), to form a controlling group with respect to FMR LLC. Neither FMR LLC nor Abigail P. Johnson has the sole power to vote or direct the voting of the shares owned directly by the various investment companies registered under the Investment Company Act (the “Fidelity Funds”) advised by Fidelity Management & Research Company (“FMR Co.”), a wholly owned subsidiary of FMR LLC, which power resides with the Fidelity Funds’ Boards of Trustees. FMR Co. carries out the voting of the shares under written guidelines established by the Fidelity Funds’ Boards of Trustees. The address for FMR LLC is 245 Summer Street, Boston, MA 02210.

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SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires our directors and executive officers, and persons who own more than 10% of a registered class of our equity securities, to file with the SEC initial reports of ownership and reports of changes in ownership of our common stock and other equity securities.  Officers, directors and greater than 10% stockholders are required by SEC regulation to furnish us with copies of all Section 16(a) forms they file.

To our knowledge, based solely on a review of the copies of such reports furnished to us and written representations that no other reports were required, during the year ended December 31, 2015, all Section 16(a) filing requirements applicable to our officers, directors and greater than 10% beneficial owners were complied with except Ms. Turner filed a Form 4 on March 4, 2016 for an event that occurred on August 3, 2015.

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EXECUTIVE OFFICERS

The following table sets forth certain information with respect to our executive officers as of March 31, 2016.April 22, 2021. Biographical information with regard to Dr. CiechanoverTouchon is presented under “Proposal No. 1—Election of Directors” in this Proxy Statement.

John F. McGrath, Jr.Jakob Dupont, M.D., 56, has served as our Chief Financial OfficerExecutive Vice President, Global Head of Research & Development since January 2013.May 2020.  From December 20092018 to January 2013, Mr. McGrath was an Executive in Residence and Operating Partner at Kleiner Perkins Caufield & Byers. From November 2001 to November 2009, Mr. McGrath May 2020, Dr. Dupontserved as Chief Medical Officer at Gossamer Bio, Inc. He previously served as the Vice President and Global Head of Breast and Gynecologic Cancer Development for Genentech USA, Inc. (Roche) from January 2017 to December 2018. Before that, Dr. Dupont served as the Senior Vice President and Chief FinancialMedical Officer for Network Equipment Technologies,of OncoMed Pharmaceuticals, Inc., a networking equipment company. Mr. McGrath’s prior experience includes from January 2012 to December 2016 and as the Vice President, Clinical Research from October 2011 to January 2012. From September 2006 to October 2011, Dr. Dupont held roles of Financeincreasing responsibility in early to late-stage clinical development at Genentech, most recently as its Global Medical Director, Avastin from January 2011, in which capacity he oversaw the global medical strategy and late-stage medical program for Aspect Communications, Director of Finance for TCSI Corporation and Manager in the High Technology and Manufacturing practice at Ernst & Young. He wasAvastin. Dr. Dupont has served as a member of the board of directors of Endwave Corporation, Actel Corporation andApexigen, Inc. since August 2020.  Since February 2009, Dr. Dupont has also served as an adjunct clinical assistant professor at the Presidio Fund. Mr. McGrath isStanford University School of Medicine. Prior to joining Genentech in 2006, Dr. Dupont was a registered C.P.A. (inactive)faculty member at Memorial Sloan-Kettering Cancer Center from January 2002 to September 2006. Dr. Dupont received an A.B. in the State of CaliforniaPhilosophy from Vassar College, received an M.A. in Philosophy from New York University, and received a B.S.an M.D. from the UniversityJoan & Sanford I. Weill Medical College of Wyoming and an M.B.A. from the Stanford Graduate School of Business.Cornell University.

Mitchall G. ClarkUtpal Koppikar, 50, has served as our Senior Vice President, Chief Regulatory and Quality AssuranceFinancial Officer since March 2014. From June 20132018. Prior to March 2014, he served as the Principal of Lindum Pharmaceutical Services, a regulatory consultancy. From Decemberjoining Atara, from June 2011 to June 2013, he served as Senior Vice President, Regulatory Affairs and Quality of NantPharma, LLC, a pharmaceutical company.2018, Mr. Clark served as an independent regulatory consultant between June 2011 and December 2011. From October 2010 to June 2011, Mr. Clark served as Senior Vice President of Regulatory Affairs of Celgene. From November 2007 to October 2010, he served as Senior Vice President of Global Regulatory Affairs of Abraxis, a biopharmaceutical company, which was acquired by Celgene in October 2010. From April 2006 to November 2007, Mr. Clark servedKoppikar held several senior financial leadership positions at Gilead Sciences, Inc., including as Vice President of Regulatory Affairs of AbraxisCorporate and its predecessor entity. From May 2002 to April 2006, Mr. Clark served as Vice President of Regulatory Affairs of American BioScience, Inc., a pharmaceutical company, which was merged with Abraxis in April 2006.Operations Finance, responsible for R&D, corporate, G&A, process development and manufacturing, and strategic sourcing. Prior to that, Mr. ClarkGilead, from January 2001 to June 2011, he served in various senior regulatory positionsmultiple finance roles of increasing responsibility at American Pharmaceutical Partners, VivoRx, Inc. and Faulding,Amgen, Inc. Mr. ClarkKoppikar earned his B.S. in aerospace engineering at the University of Maryland and received a M.S. in aeronautical and astronautical engineering from Stanford University. He also holds a B. Pharm.an MBA in finance and marketing from The University of Nottingham, England.Anderson School at UCLA.

Christopher Haqq, M.D.Amar Murugan, 46, has served as our Chief Medical Officer since September 2012. From September 2011 to August 2012, Dr. Haqq served as the Chief Executive Officer of Genomic Systems, a biotechnology company. From 2007 to September 2011, Dr. Haqq served as Vice President for Clinical Research and Development at Cougar Biotechnology, Inc., a cancer-focused biotechnology company that was acquired by Johnson & Johnson in 2009, and Johnson & Johnson’s Janssen Pharmaceutical Companies division. Prior to that time, Dr. Haqq served in drug development roles at Amgen Inc., a biotechnology company, and practiced as a medical oncologist and led a translational science laboratory as an Assistant Adjunct Professor in the Division of Hematology/Oncology at the University of California, San Francisco. Dr. Haqq received a B.S. degree from Stanford University and an M.D. and Ph.D. from Harvard Medical School.

Gad Soffer has served as our Chief Operating Officer since March 2013. From August 2008 to March 2013, he held various roles in Business Development and served as Global Project Leader Abraxane at Celgene. From June 2000 to June 2001 and from April 2004 to April 2006, Mr. Soffer was a healthcare consultant with Easton Associates. He received an A.B. from Harvard University, an M.S. from Columbia University and an M.B.A. from Harvard Business School.

Heather D. Turner has served as our General Counsel and Secretary since July 2015. From June 2007 to June 2015, she was first Vice President and later Senior Vice President, General Counsel since April 2020. From February 2013 to February 2020, Mr. Murugan held several senior legal leadership positions at Assertio Therapeutics, Inc., a specialty pharmaceutical company, including as Vice President, Legal Affairs from February 2013 to February 2016, as Vice President, Legal and SecretaryDeputy General Counsel from March 2016 to June 2018, and most recently as Senior Vice President and General Counsel from July 2018 to February 2020. Prior to joining Assertio, he was a partner in the law firms of Baker Botts L.L.P. and McDermott Will & Emery LLP, where he represented technology and life sciences companies in connection with public and private financings, mergers and acquisitions and corporate securities matters. Mr. Murugan holds a B.S. from Georgetown University and a J.D. from University of California, Los Angeles.

Joseph Newell, 51, has served as our Executive Vice President and Chief Operations Officer since February 2020.  From April 2017 to February 2020, Mr. Newell served as our Executive Vice President and Chief Technical Operations Officer. From July 2015 to April 2017, he was Vice President, North America Manufacturing at Orexigen Therapeutics,Alexion Pharmaceuticals, Inc., a publicly traded biotechnology company. PriorFrom March 2008 to that time, sheJuly 2015, Mr. Newell served first as Corporate Counsel and later as Associate General Counsel – Corporate for Conor Medsystems, LLC (previously Conor Medsystems,various roles within Amgen, Inc.), a publicly traded medical devicehuman therapeutics company, including as Executive Director and Plant Manager from August 2012 to September 2014 and Executive Director, Operations Strategic Planning from September 2014 to June 2015. He received a B.S. from California State Polytechnic University – Pomona.  

Kristin Yarema, Ph.D., 50,has served as our Senior Vice President, Chief Commercial Officer since February 2020. From February 2013 to January 2020, Dr. Yarema held positions of increasing responsibility at Amgen Inc., most recently serving as Amgen’s Vice President & Therapeutic Area Head for Global Product Strategy & Commercial Innovation in Hematology and Oncology with global accountability for all hematology marketed and pipeline products, including a portfolio of innovative therapies for various hematological malignancies such as multiple myeloma, leukemia and lymphoma. From July 2007 to January 2013, she held numerous roles of increasing responsibility at Novartis AG. From September 2000 to June 2007, she held roles of increasing responsibility at McKinsey & Company. In addition, Dr. Yarema has served as a member on the board of directors of the Celiac Disease Foundation, the U.S.-based patient advocacy group, since 2017 and as a board member of the Alliance for Regenerative Medicine, an associate at Cooley LLP,international patient advocacy organization dedicated to realizing the promise of regenerative medicines and therapies, since 2020.  Dr. Yarema holds a law firm.  She received a J.D.Ph.D. in Chemical Engineering from the UCLA School of Law and a B.A. from the University of California, Santa Barbara where she graduated with honorsBerkeley and was elected Phi Beta Kappa.  Shea B.S. in Chemical Engineering and B.A. in English from Stanford University.

EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

This Compensation Discussion and Analysis (“CD&A”) explains the strategy, design, and decision-making related to our compensation programs and practices for our principal executive officer, our principal financial officer and our three other most highly compensated executive officers, referred to collectively as our named executive officers. This CD&A is a memberintended to provide perspective on the information contained in the tables that follow this discussion.  For fiscal year 2020, our named executive officers were:

¹Dr. Dupont joined the Company in May 2020.
²Dr. Yarema joined the Company in February 2020.

While the principal purpose of this CD&A is to discuss the compensation of our named executive officers, many of the State Barprograms discussed apply to other members of California.senior management who, together with the named executive officers, are collectively referred to as our executive officers.

Executive Summary

We are a leading allogeneic T-cell immunotherapy company pioneering the development of transformative therapies for patients with serious diseases including solid tumors, hematologic cancers and autoimmune diseases.  Using our novel allogeneic EBV T-cell platform, we intend to deliver treatments to patients with high unmet need.  Our platform aims to leverage the unique biology of EBV T cells to channel the power of the immune system and has the potential to treat a wide range of diseases.  We are applying this one platform to create a robust pipeline with the goal of developing treatments that improve the quality and longevity of patients’ lives.  Our pipeline includes tabelecleucel (tab-cel^®) in Phase 3 development for patients with EBV-driven post-transplant lymphoproliferative disease (“PTLD”) and in earlier stages of development for other EBV-associated diseases, ATA188 for the potential treatment of multiple sclerosis and next-generation CAR T therapies for the potential treatment of solid tumors and hematologic cancers. 

Despite the significant headwinds created by the COVID-19 pandemic over the past year to our business, operations, people and communities, we believe the Company had a remarkable year, delivering on key milestones across the Company’s three strategic priorities.  Significant accomplishments of our team in 2020 include: (i) the important progress we made on the anticipated regulatory filing package for tab-cel, both in the United States and in Europe; (ii) initiation of our Phase 2 multi-cohort study to evaluate tab-cel in other areas of high unmet medical need; (iii) initiation and continued enrollment of our Phase 2 randomized controlled study of ATA188, a product candidate with the potential to transform the treatment paradigm for multiple sclerosis; (iv) execution of a strategic collaboration with Bayer AG (“Bayer”) involving ATA2271 and ATA3271, our next-generation mesothelin-targeted CAR T program; (v) initiation of investigational new drug (“IND”) enabling studies for ATA3219, our preclinical, allogeneic CD19 CAR T we believe has the potential be a best-in-class therapy; and (vi) numerous presentations of clinical and preclinical data throughout 2020, which reflect not only the potential of our product candidates to treat patients with high unmet need, but also the perseverance and resilience of our team as well as the healthcare professionals and patients participating in our clinical development programs.  The commitment and dedication of the entire Atara team in 2020 was impressive and inspiring.  Through unprecedented and unpredictable circumstances, our team remained nimble, adapting to new challenges, and protecting the health and safety of Atara’s employees while remaining focused on our mission to bring transformative therapies to patients with serious diseases.

This focus and resiliency helped us deliver on key milestones across Atara’s three strategic priorities in 2020:

We believe these significant achievements helped to deliver our strong total stockholder return of over 19% in 2020.

2020 Executive Compensation Program Highlights

Throughout the past year, the Compensation Committee, in conjunction with the entire Board, monitored the evolving COVID-19 pandemic and assessed the potential impact on our business and operations, including our manufacturing operations, the timing and execution of clinical and preclinical studies, and the health and safety of our employees. Compensation decisions were designed to advance the interests of the Company, our stockholders and our employees.  To further strengthen the alignment between executive and stockholder interests, the Compensation Committee also made several changes to our executive compensation program described below.

Our first two highlights are changes to our equity granting practices:

Our next highlight further aligned our pay program with leading market practices:

Compensation Practices and Governance Highlights

The Compensation Committee recognizes the Company operates in the highly competitive and dynamic biotechnology industry, and in particular, within the cell and gene therapy area.  Therefore, to ensure that the overall compensation packages we offer to our executive officers remain competitive with the packages offered by companies with which we compete for executive talent, our Compensation Committee reviews market best practices in executive compensation to continually refine our programs.  In addition, our Compensation Committee reviews our executive compensation program to ensure our practices align the interests of our directors and executive officers with our stockholders.  Below are features of our compensation program which the Compensation Committee believes demonstrate our commitment to link executive compensation to performance and to incentivize the creation of stockholder value.

Result of Stockholder Advisory Vote and Stockholder Engagement

We believe that strong corporate governance should include year-round, constructive dialogue with stockholders on business strategy, operational executive, corporate governance, our executive compensation program and other critical business matters. Our engagement with stockholders allows us to better understand stockholders' views and interests, solicit their feedback and share our perspective on these and other important subjects.

In 2019 we held our first stockholder advisory vote on executive compensation (commonly referred to as a “say-on-pay” vote), which resulted in strong support. There was a decreased level of support of our say-on-pay proposal in 2020.  Following the 2020 annual meeting, we initiated further engagement with stockholders aimed at eliciting a better understanding of their concerns and perspectives.  The Compensation Committee considered the feedback obtained from these discussions with our stockholders in making its executive compensation decisions in 2020, and to the extent applicable, will consider such feedback for future periods.  The Compensation Committee also considered issues identified by several proxy advisory firms, adopting several policies in line with peer companies to further strengthen the alignment between executive and stockholder interests and mitigate perceived compensation-related risk.

Our investor relations team and members of our senior management regularly engage and have dialogue with our stockholders throughout the year, including following our quarterly earnings calls, through participation at investor conferences and via other channels of communication.  These interactions provide an opportunity to discuss the Company’s executive compensation measures and obtain feedback from stockholders to better understand investor perspectives on the Company’s strategic, operational, governance, executive compensation matters and other topics of interest.

Compensation Philosophy and Objectives

Our philosophy in setting compensation policies for executive officers has two primary objectives: (i) to attract and retain talented and skilled executives by paying for performance; and (ii) to align compensation of our executives with the interests of our stockholders through an appropriate mix of short-term and long-term compensation. Our Compensation Committee believes that executive compensation should be directly linked to corporate performance and longer-term stockholder value and our executive compensation program is appropriately designed, balanced, and appropriately links executive compensation to both continuous and longer-term improvement in corporate performance.

Our compensation program is consistently and meaningfully focused on pay for performance principles, and historically payouts have been both above and below target under our annual incentive plans to reflect Company performance in that year. In determining compensation for executive officers, the Compensation Committee does not formulaically benchmark against any one specific reference point.  Instead, the Compensation Committee considers several factors, including peer group survey data, tenure, role, responsibilities, performance and local competitive market practices and trends. Our Compensation Committee focuses on the following principles to guide decisions regarding executive compensation:

How We Determine Executive Compensation

Role of the Compensation Committee and Executive Officers

The Compensation Committee oversees and approves all compensation arrangements for our executive officers, including our named executive officers. While the Compensation Committee has numerous resources available to it, including input from our Board, Chief Executive Officer and independent consultants, ultimate decision-making authority rests with the Compensation Committee. The Compensation Committee retains discretion over base salaries, annual bonuses and equity compensation for executive officers and bases its decision on a careful review of performance as well as the competitive market environment.

The Compensation Committee typically meets at least four times per year, with additional meetings as necessary. The Compensation Committee met five times in 2020. The agenda for each meeting is set by the Chair of the Compensation Committee, with consultation, as appropriate with our Chief Executive Officer, Chief People Officer, General Counsel and Radford, our independent compensation consultant. Members of management and Radford may be invited to participate in meetings, but the Compensation Committee meets regularly in executive session. Our Chief Executive Officer is often present and participates in discussions regarding compensation of our other executive officers. Executives, including our Chief Executive Officer, are not present during deliberations regarding their own performance or compensation.

Role of Compensation Consultants

The Compensation Committee has retained the services of Radford, as our independent compensation consultant. Radford assists the Compensation Committee in its review of executive and director compensation practices, including the market competitiveness of compensation, executive compensation design, benchmarking with industry peers and other technical considerations including those related to tax and accounting.

For 2020 compensation matters, Radford advised and assisted with the following:

The Compensation Committee regularly evaluates the services Radford provides and has final authority to engage and terminate their services. Our Compensation Committee has assessed Radford’s independence consistent with Nasdaq listing standards and has concluded that the engagement of Radford does not raise any conflict of interest.

Competitive Assessment

A key objective of our executive compensation program is to ensure that the overall compensation packages we offer our executive officers remain competitive with the packages offered by companies with which we compete for executive talent. The Compensation Committee consults with its independent compensation consultant to develop a peer group of companies to serve as the basis for comparing our executive compensation program to the market.

2020 Peer Group

With the assistance of Radford, the Compensation Committee annually reviews the composition of the peer group to account for changes in both our business and the businesses of the companies in the peer group. While referencing the peer group compensation levels is helpful in determining market-competitive compensation for our named executive officers, the Compensation Committee does not directly tie any pay elements to particular benchmarks within the peer group. Rather, peer data is one consideration, along with employee knowledge, skills and experience, individual performance, and scope of responsibilities, among other factors.

26A key change to the 2020 peer group from the previous year was to realign our peer group to target companies within a market cap range of $300 million to $3 billion.  As a result, five companies were removed because they were outliers based on the new criteria or had been acquired.  In developing the 2020 peer group, the Compensation Committee considered several key qualitative and quantitative elements as set out below.

Following this analysis, the Compensation Committee identified the following 19 publicly-traded, U.S-based biotechnology/pharmaceutical companies as our peer group to be used in reviewing compensation for 2020:

Elements of Executive Compensation

The Compensation Committee has developed an executive compensation program that consists of the following primary elements:

The relative mix of these components is generally weighted towards incentive rather than fixed compensation and towards long-term incentive compared to short-term incentive compensation. We believe this relative weighting towards long-term equity-based compensation ensures that the interests of our executives are aligned with those of our stockholders.

Target Compensation Mix

Our Compensation Committee has not established formal policies or guidelines for allocating compensation between annual and long-term incentive compensation, or between cash and non-cash compensation. Instead, through our compensation program, the Compensation Committee seeks to align pay and performance. As can be seen in the graphs below, a large percentage of executive pay in 2020 was variable and “at-risk” (89% for the Chief Executive Officer, and 79% on average for our other named executive officers), meaning that value to the executive is tied directly to corporate goals, individual goals (except for the Chief Executive Officer), and stock price performance. In this sense, we believe we have established a pay-for-performance culture and pay program. The balance between these components may change from year to year based on corporate strategy and objectives, among other considerations.

The PSUs in the chart reflect the target grant date aggregate fair value of PSUs based on the performance conditions.  

Base Salary

In considering the appropriate level of base salaries for our named executive officers for 2020, the Compensation Committee employed a holistic analysis of multiple relevant factors using its professional judgment and experience, emphasizing the following:

The Compensation Committee considered the base salaries of similarly situated executives at our 2020 peer group companies for an understanding of whether our compensation program is competitively positioned to retain our highly qualified named executive officers. The Compensation Committee determined that each named executive officer should receive an increase in his or her base salary for 2020 as follows:

Annual Cash Bonuses

Annual Performance Goals

The Compensation Committee works with the executive team to develop goals with respect to the Company’s annual incentive compensation program and ultimately recommends a list of goals to the Board for approval. The Board reviews the strategic, operational and financial components of the goals and approves the goals as well as a weighting for each goal based on its relative importance. Our Chief Executive Officer and executive team provide updates to the Board through the course of the year on performance towards these goals. At the end of the year, our Chief Executive Officer presents the Compensation Committee with a proposed score based on the Company’s performance against the goals. After discussion and review, the Compensation Committee a recommendation on the overall corporate achievement score compared to the annual performance goals to the Board for approval. This score is then used to establish the corporate portion of annual bonus payments.

In addition, our Chief Executive Officer works with each executive officer to establish individual performance goals and objectives. Individual goals are evaluated in a more qualitative and subjective manner than the corporate goals, and executive officers are evaluated on overall achievement of individual goals as well as overall contribution to the Company’s corporate goals. This evaluation is done by our Chief Executive Officer who then recommends an individual bonus amount to the Compensation Committee for consideration and approval.  

Annual Bonus Process

The Compensation Committee conducts an annual performance and compensation review for our executive officers, including our Chief Executive Officer.  The Compensation Committee reviews base salary, annual bonus and equity-based compensation annually as part of this review.  The review is typically conducted over a series of meetings beginning at the end of the year and as part of the Company’s broader annual performance review process.  The annual corporate score which is determined as described above in “Annual Performance Goals” is used to determine the size of the Company-wide bonus pool.  Our Chief Executive Officer receives a bonus based entirely on corporate performance since they have ultimate operational responsibility for corporate performance. Our other executives receive a bonus which is primarily linked to corporate performance (85%), with a smaller individual performance component (15%). The individual performance component of the bonus for these executive officers can be modified up to 125% or down to 0% dependent on performance in the prior year. In addition, the Compensation Committee retains flexibility to increase or decrease any and all compensation components to reflect performance.

2020 Bonus Targets

Bonus targets (expressed as a percentage of base salary) are reviewed annually by the Compensation Committee, taking into consideration competitive market data, and adjusted if deemed appropriate by the Compensation Committee.

2020 Corporate Goal Development and Weighting

In February 2020, the Board reviewed and approved the corporate goals and objectives for 2020, as summarized in the table below. In selecting these goals, the Board believed that they were appropriate drivers for our business, as they provided a balance between the efforts necessary (i) for the continued clinical development of tab-cel, ATA188 and our CAR T program, including ATA2271, ATA3271 and ATA3219, (ii) to advance critical elements of our manufacturing and operational capabilities to support our clinical and preclinical activities and potential commercial requirements, (iii) to financially fund our operations to support such efforts, (iv) to further the strategic value of our CAR T platform and (v) to enhance our corporate culture to enable these critical corporate objectives. At the time the 2020 corporate goals were set, the Board and management believed that such goals were challenging, and that achieving them would require not only continued strong progress on research and clinical development, manufacturing and operational capabilities, and prudent fiscal and legal management, but also a high level of effort and execution on the part of our named executive officers.

The Board also applied a performance weighting to each goal relative to our overall performance to reflect the prioritization of key business objectives. Additionally, a weighting between corporate performance and individual performance was applied for each named executive officer to reflect the level of impact such individual would be able to make on the overall corporate performance. The relative weighting between our 2020 corporate objectives relating to advancing our pipeline and developing our platform relative to additional 2020 corporate objectives is summarized below.

Performance Evaluation

Despite the unprecedented challenges we faced in 2020, we achieved most of our corporate goals and objectives set for 2020, including, but not limited to: (i) meeting our enrollment goals for the pivotal Phase 3 ALLELE Study for tab-cel; (ii) filing an IND for ATA2271; (iii) meeting our operational and technical goals at our manufacturing facility; (iv) meeting our cash runway target; and (v) securing a partner for our mesothelin targeted CAR T program with the execution of our strategic collaboration with Bayer for our CAR T platform.  We also continued to cultivate a high performing corporate culture, notwithstanding the disruption caused by the COVID-19 pandemic, and filled critical roles at the Company in order to drive the execution of our corporate objectives.

In addition to achieving the foregoing corporate goals, we also made significant progress on our strategic priorities in 2020.  We conducted an interim analysis of the Phase 3 ALLELE study showing tab-cel for patients with EBV+ PTLD achieved a 50% objective response rate and safety consistent with historical data.  We had productive discussions with the FDA on the BLA filing package and completed the preclinical module 4 of the BLA filing package.  In Europe, we received ratification from the Pediatric Committee of the European Medicines Agency of our PIP for tab-cel.  We also presented data across our programs at a number of virtual congresses and conferences throughout 2020, including ATA188 data showing PMS patients achieving SDI at any time point maintained SDI at all future time points, with favorable safety at all dose levels.  We believe our strategic collaboration with Bayer for ATA2271 and ATA3271 serves as strong recognition of the innovative and leading position of our CAR T platform.

We also rapidly and effectively responded to the COVID-19 pandemic with support designed to address our employees’ needs and operational requirements. At the onset of the COVID-19 pandemic, we promptly established a pandemic rapid response team, implemented new oversight, operational and safety protocols to enable a core essential team to safely work in our laboratories and manufacturing facility.  With these new safety measures, we continued to manufacture, test, release and deliver our clinical products to patients without delay and advance our pre-clinical and translational research at our laboratories despite the impact of the COVID-19 pandemic.

The Board evaluated the Company’s performance against the above goals considering the additional challenges brought on by the COVID-19 pandemic. The Board determined the Company was able to meet key critical goals relating to our pipeline and corporate operations. The Board also determined where certain goals were not achieved, or where there was delayed achievement, such non-achievement or delayed achievement was immaterial in the overall context of these goals.  The Board further determined the Company overachieved a number of the goals, including with regard to the goals relating to the continuing advances in the development of our platform, securing a strategic collaboration with Bayer, meeting our cash runway target, improvements in staff member engagement, recruitment of talented executives to fill critical roles and enhancement of our corporate culture. Based on the Company’s foregoing achievements, considering the unanticipated and significant challenges and additional workload imposed by the need to adapt to the unprecedented environment created by the COVID-19 pandemic, and as recommended by the Compensation Committee, the Board deemed it appropriate to approve 100% achievement of the 2020 corporate goals.

In consideration of the foregoing, in February 2021, pursuant to the terms and conditions of the applicable annual bonus guidelines, the Compensation Committee approved annual cash bonus payments for each named executive officer as reflected in the table below.

¹Dr. Dupont joined the Company in May 2020, which resulted in a prorated annual bonus.
²Dr. Yarema joined the Company in February 2020, which resulted in a prorated annual bonus.

Long-Term Incentives

Our goal is to align executive compensation and performance that advances our critical business objectives. Therefore, a significant portion of the named executive officers’ total compensation typically has consisted of, and is expected to continue to consist of, equity-based awards. In evaluating the mix of equity awards for 2020, the Compensation Committee considered market trends, as well as applicable feedback from stockholders and proxy advisory firms, and determined that a mix of stock options, RSUs and where appropriate, PSUs, would be the most appropriate incentive structure for our named executive officers to reward performance over time and achieve our retention objectives. The following table outlines the equity awards granted to named executive officers in 2020 (excluding one-time retention grants).

Equity Grants

¹Reflects 100% target payout of PSUs.
² Dr. Dupont joined the Company in May 2020, which resulted in a reduced PSU grant.
³Dr. Yarema joined the Company in February 2020, which resulted in a reduced PSU grant.

Stock Options

The Compensation Committee grants stock options to emphasize retention and align the named executive officers’ interests with those of stockholders. These awards provide a necessary balance between performance-based and time-vesting awards.

Stock option awards will generally be fully vested four years after the option grant date, subject to continuous service.

RSUs

RSUs are an important retention vehicle for named executive officers, as well as a variable and at-risk component of executive compensation. Market trends reflect their favored use among our peer group and other companies in the biotechnology sector.

RSU awards will generally be fully vested four years after the RSU grant date, subject to continuous service.  

PSUs

Our currently outstanding PSUs are contingent on the completion of significant performance goals and milestones related to tab-cel, as approved by the Compensation Committee in March 2020.  The PSUs vest in three separate tranches, each tied to one of the following tab-cel milestones: (i) initiation of a BLA; (ii) completion of a BLA filing; and (iii) receipt of FDA marketing approval. The number of PSUs that actually vest upon completion of a milestone is also contingent on the timing of when the applicable milestone is met and is scaled such that a larger percentage of PSUs vest on the earlier achievement of such milestone.  The PSU tranches relating to the initiation of a BLA and the completion of a BLA filing may vest between 0-100%, and the PSU tranche relating to the receipt of FDA marketing approval may vest between 0-130%, in each case depending on the date when such applicable milestone is achieved.  None of these PSUs vested in 2020.

Additionally, in September 2020, the Compensation Committee approved PSUs for certain employees joining the Company between January 2020 and June 2020.  This PSU grant is contingent upon the receipt of FDA marketing approval.  The number of PSUs that actually vest upon completion of the milestone is also contingent on the timing of when the milestone is met and is scaled such that a larger percentage of PSUs vest on the earlier achievement of the milestone.  These PSUs may vest between 0-130%, depending on the date when the milestone is achieved.  None of these PSUs vested in 2020.

One-Time Retention Grants

The Compensation Committee recognizes the Company operates in the highly competitively biotechnology industry, and in particular, within the cell and gene therapy area.  The Compensation Committee believes that retention grants are crucial tools for rewarding key employees for their achievements as well as future performance. In 2020, the Compensation Committee approved one-time, targeted retention grants of RSUs to certain key individuals at the Company along with their 2020 annual RSU grants to mitigate attrition and promote retention amongst leaders critical to our business continuity and to our ability to achieve our strategic objectives and meet significant milestones. The following targeted retention grants were made to named executive officers in 2020.  

¹Dr. Dupont joined the Company in May 2020 and was ineligible to receive a retention grant.

²Dr. Yarema joined the Company in February 2020 and was ineligible to receive a retention grant.

Other Compensation Policies and Practices

Hedging Policy

The Company’s policies prohibit all employees (including executive officers) and directors from engaging in short sales, transactions in put or call options, hedging transactions or similar inherently speculative transactions with respect to our stock at any time.

Stock Ownership Guidelines

Effective as of January 1, 2021, in order to further align their financial interests with those of our stockholders as well as to promote sound corporate governance, we adopted stock ownership guidelines for our named executive officers. These guidelines establish the following ownership targets for the value of stock held by each individual:

The guidelines must be achieved (i) by each individual covered under the guidelines (a “Covered Individual”) by December 31, 2025 and (ii) for any individual who becomes a Covered Individual after January 1, 2021, by December 31 of the calendar year in which the fifth anniversary of the date the individual became a Covered Individual occurs. The shares counted towards the ownership requirements specified in the guidelines include shares owned outright (valued at fair market value),  unvested RSUs (valued at 70% of fair market value) and vested stock options (valued at 70% of intrinsic value, the number of shares vested multiplied by the difference between the exercise price and the Nasdaq closing price of our common stock on the measurement date),  as applicable, to account for any sales of such equity required to be sold or withheld to cover taxes.

Once a Covered Individual has complied with these Guidelines, such Covered Individual shall be deemed to remain compliant under the guidelines notwithstanding any change in his or her base pay or change in the value of his or her equity which would otherwise make such Covered Individual non-compliant; provided that a sale or other disposition of shares of stock (other than the sale, or surrender to the Company, of shares of stock in payment of the exercise price of any equity award or in satisfaction of taxes in connection with vesting or exercise of any equity award) may, as applicable, cause the Covered Individual to no longer be deemed in compliance with the guidelines.  A Covered Individual’s ownership is reviewed annually as of December 31 of a calendar year to determine if the Covered Individual has met, or is on track to meet, the applicable guideline.  As of March 31, 2021, each Covered Individual is either in compliance, or on track to be in compliance, with the ownership targets set forth in the guidelines within the timeframe specified in the guidelines.  

Clawback Policy

In December 2020, the Board adopted the Clawback Policy which provides for the Company’s recoupment of certain incentive compensation paid to covered officers of the Company under certain circumstances of misconduct. The Board may delegate determinations to be made under the Policy to a committee of the Board.  

Pursuant to the Clawback Policy: (i) “misconduct” refers to a knowing violation of SEC rules or regulations or Company policy or the willful commission of an act of fraud, dishonesty or gross recklessness in the performance or disregard of a person’s duties; and (ii) “covered officer” refers to a current or former officer of the Company who is or was designated as an “officer” for purposes of Section 16 of the Securities Exchange Act of 1934, as amended, by the Board or an appropriate committee of the Board.  There was no recoupment under the Clawback Policy in 2020.

Accounting and Tax Considerations

Under the Financial Accounting Standard Board (“FASB”) Accounting Standards Codification (Topic 718) (“ASC 718”), we are required to estimate and record an expense for each award of equity compensation (including stock options, RSUs and PSUs) over the vesting period of the award. For such period as stock options, RSUs and PSUs remain the sole components of our long-term compensation program, we expect to record stock-based compensation expense on an ongoing basis according to ASC 718. Compensation expense relating to awards subject to performance conditions is recognized if it is probable that the performance goals will be achieved. The probability of achievement of such goals is assessed on a quarterly basis. The Compensation Committee has considered, and may in the future consider, the grant of restricted stock to our executive officers in lieu of stock option grants, RSU and/or PSU awards.

Under Section 162(m) of the Internal Revenue Code (“Section 162(m)”), compensation paid to each of the Company’s “covered employees” that exceeds $1 million per taxable year is generally non-deductible unless the compensation qualifies for certain grandfathered exceptions (including the “performance-based compensation” exception) for certain compensation paid pursuant to a written binding contract in effect on November 2, 2017 and not materially modified on or after such date. Although the Compensation Committee will continue to consider tax implications as one factor in determining executive compensation, the Compensation Committee also looks at other factors in making its decisions and retains the flexibility to provide compensation for the named executive officers in a manner consistent with the goals of the Company’s executive compensation program and the best interests of the Company and its stockholders, which may include providing for compensation that is not deductible by the Company due to the deduction limit under Section 162(m). The Compensation Committee also retains the flexibility to modify compensation that was initially intended to be exempt from the deduction limit under Section 162(m) if it determines that such modifications are consistent with the Company’s business needs.

Compensation Policies and Practices as They Relate to Risk Management

The Compensation Committee has reviewed the Company’s compensation policies and practices, in consultation with Radford and the Company’s outside counsel, to assess whether they encourage employees to take inappropriate risks. After reviewing and assessing the Company’s compensation philosophy, terms and practices, including the mix of fixed and variable, short and long-term incentives and overall pay, incentive plan structures and the checks and balances built into, and oversight of, each plan and practice, the Compensation Committee determined that any risks arising from our compensation policies and practices for our employees are not reasonably likely to have a material adverse effect on our Company as a whole.

EXECUTIVE COMPENSATIONCEO Pay Ratio Disclosure

Under the Dodd-Frank Act and the related SEC rule (the “Rule”), we are required to provide our stockholders with specified disclosure regarding the relationship of our Chief Executive Officer’s total compensation to the total compensation of our median employee, referred to as “pay-ratio” disclosure.  For 2020, the annual total compensation of our Chief Executive Officer, for purposes of this disclosure, was $5,285,827, and the compensation of our median employee was $192,923, resulting in a pay ratio of approximately 27:1.

In accordance with SEC rules, we have identified the median employee as of December 31, 2020 by: (i) aggregating for each applicable employee: (a) annual base salary for salaried employees (or annual scheduled wages plus overtime for hourly employees), (b) the target incentive pay paid for fiscal year 2020, and (c) the estimated grant date fair value of any equity awards granted during fiscal year 2020, and (ii) ranking this compensation measure for our employees from lowest to highest. This calculation was performed for all employees employed by us as of December 31, 2020, excluding the Chief Executive Officer, whether employed on a full-time, part-time or seasonal basis. In making this determination, we annualized the compensation of employees who were employed by the Company for less than the entire fiscal year. This compensation measure was consistently applied to all employees included in the calculation and reasonably reflects the annual compensation of employees. All amounts paid in currencies other than US Dollars were converted to US Dollars based on the applicable average annual exchange rates.

The pay ratio reported above is a reasonable estimate calculated in a manner consistent with SEC rules based on our internal records and the methodology described above. The SEC rules for identifying the median compensated employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices. Therefore, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies have different employee populations and compensation practices and may utilize different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios. Dr. Touchon’s compensation as Chief Executive Officer for 2020 was as follows:

Summary Compensation Table

The following table sets forth information regarding compensation awarded to or earned by theour named executive officers listed below during the years ended December 31, 20152020, 2019 and December 31, 2014. As an emerging growth company, we comply with the executive compensation disclosure rules applicable to “smaller reporting companies,” as such term is defined in the rules promulgated under the Securities Act, which require compensation disclosure for our principal executive officer and the two most highly compensated executive officers other than our principal executive officer. These three officers are referred to as our named executive officers.2018.  

27Grants of Plan-Based Awards

The following table provides information regarding grants of plan-based awards to our named executive officers for the fiscal year ended December 31, 2020: