2021 Annual Meeting of Stockholders (Class II)

Francis X. Egan has served on our board of directors since May 2010. Mr. Egan currently serves as the Managing Partner of Lake Bridge Capital Management LLC, an investment advisory firm, a position he has held since 2016, as a Managing Director of GEN3 Capital, a position he has held since 2005 and as Director of Ioxus, Inc., a position he has held since 2011. Mr. Egan previously served as the Managing Director of Northwater Capital, Inc., an intellectual property focused venture capital company, a position he held from 2006 through August 2016. Prior to GEN3 Capital, Mr. Egan served as Senior Vice President with PaineWebber (UBS), Kemper Securities Inc. and Dain Rauscher Wessels. Mr. Egan currently serves on the board of directors of various private companies including Arctic Sand Technologies, Inc., Aquilon Energy Services, Inc., EPAY Systems, Red Wave Energy, Inc., MTPV Power Corporation, Ioxus, Inc., R3 Fusion, Inc., Legend 3D, Inc., Solicore, Inc. and VanDyne Super Turbo Powermeters. Mr. Egan holds a B.A. from Marquette University, Milwaukee, Wisconsin. Mr. Egan’s extensive experience as a venture capital investor in the technology industry, as well as his extensive experience as a board member of numerous companies, contributed to our board of directors’ conclusion that he should serve as a director of our company.

Arthur M. Toscanini has served on our board of directors since 2005. Mr. Toscanini is the Chief Financial Officer of GEN3 Partners, a position he has held since 2000. Prior to GEN3 Partners, he was with Cambridge Technology Partners from 1991 to 2000, where he served as the Chief Financial Officer. Mr. Toscanini also served as Vice President and Controller of Concurrent Computer Corporation from 1986 to 1991. Prior to Concurrent Computer Corporation, he worked at Perkin-Elmer Data Systems Group. Mr. Toscanini currently serves on the board of directors of EPAY Systems. He holds a B.A. in accounting from Pace University and an M.A. in management from Monmouth University. Mr. Toscanini’s extensive knowledge of our business and experience as a chief financial officer contributed to our board of directors’ conclusion that he should serve as a director of our company.

Term Expiring at the

2019 Annual Meeting of Stockholders (Class III)

Joan H. Gillman has served on our board of directors since November 2016. Ms. Gillman has served as Executive Vice President and Chief Operating Officer of Time Warner Cable Media from September 2006 to June 2016. She first joined Time Warner Cable as a new product and marketing consultant in January 2004 and served from May 2005 to September 2006 as Vice President of Interactive TV and Advanced Advertising. Prior to Time Warner Cable Ms. Gillman served in senior executive roles at OpenTV Corporation, British Interactive Broadcasting Holdings Limited, and Physicians’ Online Inc. She has also held two of the top senior roles in the Office of U.S. Senator Chris Dodd, Dodd—State Director and Legislative Director. Ms. Gillman currently serves on the board of directors

of Centrica PLC, InterDigital, (IDCC) and The Jesuit Volunteer Corp. She has previously served on the boardboards of directors of various private companies, industry associations, and not-for-profits,not-for-profits; including the College of the Holy Cross, Thethe CityParks Foundation, National Cable Communications (NCC) LLC, and the Interactive Advertising Bureau (IAB).Bureau. Ms. Gillman’s extensive experience as an operating executive in the cable and technology industries, as well as her service as a director of numerous public and private companies, contributed to our board of directorsdirectors' conclusion that she should serve as a director of our company.

Frances Kordyback

Arthur M. Toscanini has served on our board of directors since November 2005. Ms. KordybackMr. Toscanini is a Commissioner with the Ontario Securities Commission,Chief Financial Officer of GEN3 Partners, a position shehe has held since November 2016. Ms. Kordyback previously served as a Managing Director of Northwater Capital Management Inc., a position she held from January 2005 through September 2016.2000. Prior to Northwater Capital Management, sheGEN3 Partners he was with Cambridge Technology Partners from 1991 to 2000 where he served as the Managing DirectorChief Financial Officer. Mr. Toscanini also served as Vice President and Controller of CCFL Parklea Capital Inc.Concurrent Computer Corporation from January 20031986 to December 2004. Ms. Kordyback was a partner in Plaxton & Co. Limited from February 19991991. Prior to December 2001. Ms. Kordyback alsoConcurrent Computer Corporation he worked at Perkin-Elmer Data Systems Group. Mr. Toscanini currently serves on the board of directors of the Ontario Securities Commission. Ms. KordybackEPAY Systems. He holds a BachelorBA in accounting from Pace University and an MA in management from Monmouth University. Mr. Toscanini’s extensive knowledge of Mathematics from the University of Waterloo. Ms. Kordyback’sour business and experience as a venture capitalist investing in the technology industry and her governance and regulatory experiencechief financial officer contributed to our board of directors’ conclusion that shehe should serve as a director of our company.

Thomas A. Munro has served on our board of directors since 2004. Mr. Munro is the Chief Executive Officer of Verimatrix, Inc., an Internetinternet security technology company, a position he has held since April 2005. Prior to Verimatrix Mr. Munro was the President of Wireless Facilities from 2001 to 2003 and Chief Financial Officer from 1997 to 2001. Previously he was the Chief Financial Officer of Precision Digital Images from 1994 to 1995 and MetLife Capital Corporation from 1992 to 1994. Mr. Munro currently serves on the board of directors of BandwidthX, Inc., a private company, and previously served on the boardboards of directors of private companies Kineticom, Inc. and CommNexus. Mr. Munro holds a B.A.BA in business and an M.B.A.MBA from the University of Washington. Mr. Munro’s extensive knowledge of our business and history and experience in the wireless technology industry contributed to our board of directors’ conclusion that he should serve as a director of our company.

Jacob Suen has served on our board of directors and as Chief Executive Officer since August 2019 and as our President since January 2019. He previously served as our Senior Vice President, Worldwide Sales from May 2017 through January 2019. Mr. Suen started with the company in April 2006 as the Vice President of Asia Pacific Sales. He previously served as the Director of Business Development from 1998 to 2005 at Paradyne Corporation.  Prior to Paradyne Mr. Suen was a development engineer at GVN Technologies in 1998.  From 1997 to 1998 Mr. Suen was a software development engineer for Motorola Incorporation.  Mr. Suen holds an MS in Electrical Engineering with a concentration in Communication Systems and a minor in Engineering Management from the University of South Florida.  Mr. Suen has his MBA with a focus on International Business and Entrepreneurship from the University of Colorado. Mr. Suen’s extensive knowledge of and experience at our business contributed to our board of directors’ conclusion that he should serve as a director of our company.

Board Independence

Our board of directors currently consists of six members. Our board of directors has determined that all of our directors are independent directors within the meaning of the applicable NASDAQ CapitalNasdaq Stock Market LLC, or Nasdaq, listing standards, except for Charles Myers,Mr. Sims, our Presidentchairman of the board of directors and Mr. Suen, our Chief Executive Officer.  Officer and President.  The Nasdaq independence definition includes a series of objective tests, including that the director is not, and has not been for at least three years, one of our employees and that neither the director nor any of his family members has engaged in various types of business dealings with us. In addition, as required by Nasdaq rules, our board of directors has made a subjective determination as to each independent director that no relationships exist, which, in the opinion of our board of directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In making these determinations our board of directors reviewed and discussed information provided by the directors and us with regard to each director’s business and

personal activities and relationships as they may relate to us and our management. There are no family relationships among any of our directors or executive officers.

Board Leadership Structure

Our board of directors is currently led by its chairman, James K. Sims. Our board of directors recognizes that it is important to determine an optimal board leadership structure to ensure the independent oversight of management as the company continues to grow. We separate

In May 2018 Mr. Sims was appointed as our interim Chief Executive Officer and continued to serve as the roleschairman of chief executive officerour board of directors. From March through August 2019, Mr. Sims was appointed and served as our permanent Chief Executive Officer. The board of directors believed that Mr. Sims’ service as both chairman of the board of directors and Chief Executive Officer was in recognitionthe best interest of the differences between the two roles. The chief executive officer is responsible for setting the strategic direction for the company and its stockholders at the day-to-day leadership and performance of the company, while the chairman oftime. On August 8, 2019, the board of directors provides guidance to the chief executive officerappointed Jacob Suen, as our Chief Executive Officer and presides over meetingsa member of the full board of directors. We believe that this separation of responsibilities provides a balanced approach to managing theour board of directors in addition to his role as President.

Pursuant to our Corporate Governance Guidelines the board determines the best board leadership structure for our company from time to time. As part of our annual board self-evaluation process, we evaluate our leadership structure to ensure that the board continues to believe that it provides the optimal structure for our company and overseeing the company.

Ourstockholders. We recognize that different board of directors has concluded thatleadership structures may be appropriate for companies in different situations. We believe our current leadership structure is appropriatethe optimal structure for our company at this time. However, our

Each of the directors, other than Messrs. Sims and Suen, is independent, and the board believes that the independent directors provide effective oversight of management. Moreover, in addition to feedback provided during the course of board meetings, the independent directors will continuehave regular executive sessions. Following an executive session of independent directors, the independent directors communicate with Mr. Suen directly regarding any specific feedback or issues, provide Mr. Suen with input regarding agenda items for board and board committee meetings, and coordinate with Mr. Suen regarding information to periodically review our leadership structurebe provided to the independent directors in performing their duties. The board believes that this approach appropriately and may make such changes ineffectively complements the future as it deems appropriate.combined Chief Executive Officer/Director structure.

Role of Board in Risk Oversight Process

Our board of directors has responsibility for the oversight of the company’s risk management processes and, and—either as a whole or through its committees, committees—regularly discusses with management our major risk exposures, their potential impact on our business, and the steps we take to manage them. The risk oversight process includes receiving regular reports from board committees and members of senior management to enable our board of directors to understand the company’s risk identification, risk management, and risk mitigation strategies with respect to areas of potential material risk, including operations, finance, legal, regulatory, strategic, and reputational risk.

The audit committee reviews information regarding liquidity and operations and oversees our management of financial risks. Periodically the audit committee reviews our policies with respect to risk assessment, risk management, loss prevention, and regulatory compliance. Oversight by the audit committee includes direct communication with our external auditors and discussions with management regarding significant risk exposures and the actions management has taken to limit, monitor, or control such exposures. The compensation committee is responsible for assessing whether any of our compensation policies or programs has the potential to encourage excessive risk-taking. While each committee is responsible for evaluating certain risks and overseeing the management of such risks, the entire board of directors is regularly informed through committee reports about such risks. Matters of significant strategic risk are considered by our board of directors as a whole.

Board of Directors Meetings

During fiscal year 2016,2019 our board of directors met fiveseven times, including telephonic meetings. In that year each director attended at least 75% of the total number of meetings held during such director’s term of service by the board of directors and, with the exception of Ms. Gillman on the Nomination and Corporate Governance Committee, each committee of the board of directors on which such director served.

Board Committees and Independence

Our board of directors has established three standing committees—audit, compensation, and nominating and corporate governance – governance—each of which operatesoperating under a charter that has been approved by our board of directors. The table below provides current committee membership information for each of the Board committees.

Audit Committee

The audit committee’s main function is to oversee our accounting and financial reporting processes and the audits of our financial statements. This committee’s responsibilities include, among other things:

The

Our board of directors has determined that all of the members of ourthe audit committee are Ms. Gillman, Ms. Kordybackindependent directors under the applicable rules and Mr. Toscanini. Mr. Toscanini servesregulations of Nasdaq and by Rule 10A-3 of Securities and Exchange Act of 1934, as amended, or the chairperson of the committee. The audit committee met two times during fiscal year 2016.  Mr. Munro served as a member of the committee throughout 2016 and until April 2017, at which time Ms. Kordyback joined the committee.  AllExchange Act. In addition, all members of our audit committee meet the requirements for financial literacy under the applicable rules and regulations of the SEC and The NASDAQ Capital Market.Nasdaq. Our board of directors has determined that Mr. Toscanini is an “audit committee financial expert” as defined by applicable SEC rules and has the requisite financial sophistication as defined under the applicable NASDAQNasdaq rules and regulations. Our board of directors has determined that Ms. GillmanBoth our external auditor and Ms. Kordyback are independent underinternal financial personnel meet privately with the applicable rules of the SEC and The NASDAQ Capital Market relating to audit committee independence. Under the applicable NASDAQ Capital Market rules, we are permittedand have unrestricted access to phase in our compliance with the independent audit committee requirements of The NASDAQ Capital Market on the same schedule as we are permitted to phase in our compliance with the independent audit committee requirements pursuant to Rule 10A-3 under the Securities Exchange Act of 1934, or the Exchange Act, which requires all members to be independent within one year of listing. We will comply with the phase-in requirements of the NASDAQ Capital Market rules and within one year of our listing on the NASDAQ Capital Market, all members of our audit committee will be independent under NASDAQ rules and Rule 10A-3.this committee. The audit committee operates under a written charter that satisfies the applicable standards of the SEC and The NASDAQ Capital Market.Nasdaq, which the audit committee will review and evaluate at least annually.

Compensation Committee

Compensation Committee

OurThe compensation committee approves or recommends to our board of directors, policies relating to compensation and benefits of our officers and employees. The compensation committee (a) approves or recommends to our board of directors, corporate goals and objectives relevant to the compensation of our Chief Executive Officer and other

executive officers, (b) evaluates the performance of these officers in light of those goals and objectives, and (c) approves or recommends to our board of directors, the compensation of these officers based on such evaluations. The compensation committee also approves or recommends to our board of directors, the issuance of stock options and other awards under our equity plan. The compensation committee will review and evaluate, at least annually, the performance of the compensation committee and its members, including compliance by the compensation committee with its charter.

The members of our compensation committee are Mr. Egan, Mr. Munro and Mr. Sims. Mr. Munro serves as the chairperson of the committee. The compensation committee met two times during fiscal year 2016.  Ms. Gillman served as a member of the committee from November 2016 through April 2017, at which time Mr. Egan joined the committee.  

Our board of directors has determined that Mr. Egan, Mr. Munro and Mr. Simsall members of the compensation committee are independent under the applicable rules and regulations of The NASDAQ Capital MarketNasdaq relating to compensation committee independence. The compensation committee operates under a written charter which the compensation committee will review and evaluate at least annually.

Nominating and Corporate Governance Committee

The nominating and corporate governance committee is responsible for assisting our board of directors in discharging the board’s responsibilities regarding the identification of qualified candidates to become board members, the selection of nominees for election as directors at our annual meetings of stockholders (or special meetings of stockholders at which directors are to be elected), and the selection of candidates to fill any vacancies on our board of directors and any committees thereof. In addition the nominating and corporate governance committee is responsible for overseeing our corporate governance policies, as well as, reporting and making recommendations to our board of directors concerning governance matters and oversight of the evaluation of our board of directors.

The members of our nominating and corporate governance committee are Ms. Gillman, Mr. Munro and Mr. Sims. Mr. Sims serves as the chairman of the committee. The nominating and corporate governance committee met three times during fiscal year 2016.

Our board of directors has determined that Ms. Gillman, Mr. Munroall members of the nominating and Mr. Simscorporate governance committee are independent under the applicable rules and regulations of The NASDAQ Capital Market.Nasdaq. The nominating and corporate governance committee operates under a written charter which the nominating and corporate governance committee will review and evaluate at least annually.

Report of the

Audit Committee of the Board of DirectorsReport

The audit committee oversees the company’s financial reporting process on behalf of our board of directors. Management has the primary responsibility for the financial statements and the reporting process, including the systems of internal controls. In fulfilling its oversight responsibilities the audit committee reviewed the audited financial statements in the company’s annual report with management, including a discussion of any significant changes in the selection or application of accounting principles, the reasonableness of significant judgments, the clarity of disclosures in the financial statements, and the effect of any new accounting initiatives.

The audit committee reviewed with KPMG LLP, whichwho is responsible for expressing an opinion on the conformity of the company’s audited financial statements with generally accepted accounting principles, its judgments as to the quality, not just the acceptability, of the company’s accounting principles, and such other matters as are required to be discussed with the audit committee under generally accepted auditing standards and the matters listed in Public Company Accounting Oversight Board Auditing Standard No. 1301, Communications with Audit Committees.Committees. In addition the audit committee has discussed with KPMG LLP, its independence from management and the company, has received from KPMG LLP the written disclosures and the letter required by applicable requirements of the

Public Company Accounting Oversight Board regarding KPMG LLP’s communications with the audit committee concerning independence and has considered the compatibility of non-audit services with the auditors’ independence.

The audit committee met with KPMG LLP to discuss the overall scope of its services, the results of its audit and reviews, and the overall quality of the company’s financial reporting. KPMG LLP, as the company’s independent registered public accounting firm, also periodically updates the audit committee about new accounting developments and their potential impact on the company’s reporting. The audit committee’s meetings with KPMG LLP were held with and without management present. The audit committee is not employed by the company, nor does it provide any expert assurance or professional certification regarding the company’s financial statements. The audit committee relies, without independent verification, on the accuracy and integrity of the information provided, and representations made, by management and the company’s independent registered public accounting firm.

In reliance on the reviews and discussions referred to above, the audit committee has recommended to the company’s board of directors that the audited financial statements be included in our Annual Report on Form 10-K for the year ended December 31, 2016. 2019.

The audit committee and the company’s board of directors also have recommended, subject to stockholder approval, the ratification of the appointment of KPMG LLP as the company’s independent registered public accounting firm for 2017.2020.

This report of the audit committee is not “soliciting material,” shall not be deemed “filed” with the SEC, and shall not be incorporated by reference by any general statement incorporating by reference this proxy statement into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing, except to the extent that we specifically incorporate this information by reference, and shall not otherwise be deemed filed under such acts.

The foregoing report has been furnished by the audit committee.

Compensation Committee Interlocks and Insider Participation

Thomas A. Munro (chairperson), Francis X. Egan, Joan Gillman and James K. Sims served on our compensation committee during the 2016 fiscal year.

None of the members of our compensation committee during the 2016 fiscal year2019 has ever been one of our officers or employees. None of our executive officers currently serves, or has served, 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 our board of directors or compensation committee.

Director Nomination Process

Director Qualifications

Our nominating and corporate governance committee is responsible for reviewing with the board of directors, on an annual basis, the appropriate characteristics, skills, and experience required for the board of directors as a whole and its individual members. In evaluating the suitability of individual candidates (both new candidates and current members), the nominating and corporate governance committee, in recommending candidates for election, and the board of directors, in approving (and, in the case of vacancies, appointing) such candidates, will take into account many factors, including the following:

Currently our board of directors evaluates each individual in the context of the board of directors as a whole, with the objective of assembling a group that can best maximize the success of the business and represent stockholder interests through the exercise of sound judgment using its diversity of experience in these various areas.

Other than the foregoing there are no stated minimum criteria for director nominees, although the nominating and corporate governance committee may also consider such other factors as it may deem to be in the best interests of our company and our stockholders. The nominating and corporate governance committee does, however, believe it appropriate for at least one, and preferably, several, members of our board of directors to meet the criteria for an “audit

“audit committee financial expert” as defined by SEC rules, and that a majority of the members of our board of directors meet the definition of “independent director” under NASDAQNasdaq qualification standards. The nominating and corporate governance committee also believes it is appropriate for our President and Chief Executive Officer to serve as a member of our board of directors.

Identification and Evaluation of Nominees for Directors

The nominating and corporate governance committee identifies nominees for director by first evaluating the current members of our board of directors willing to continue in service. Current members with qualifications and skills that are consistent with the nominating and corporate governance committee’s criteria for board of director service and who are willing to continue in service are considered for re-nomination while, at the same time, balancing the value of continuity of service by existing members of our board of directors with that of obtaining a new perspective or expertise.

If any member of our board of directors does not wish to continue in service, or if our board of directors decides not to re-nominate a member for re-election, or if the board of directors decides to expand the size of the board,board; the nominating and corporate governance committee identifies the desired skills and experience of a new nominee in light of the criteria above. The nominating and corporate governance committee generally polls our board of directors and members of management for their recommendations. The nominating and corporate governance committee may also review the composition and qualification of the boards of directors of our competitors and may seek input from industry experts or analysts. The nominating and corporate governance committee reviews the qualifications, experience, and background of the candidates. Final candidates are interviewed by the members of the

nominating and corporate governance committee and by certain of our other independent directors and executive management. In making its determinations the nominating and corporate governance committee evaluates each individual in the context of our board of directors as a whole, with the objective of assembling a group that can best contribute to the success of our company and represent stockholder interests through the exercise of sound business judgment. After review and deliberation of all feedback and data, the nominating and corporate governance committee makes its recommendation to our board of directors.  Historically the nominating and corporate governance committee has not relied on third-party search firms to identify director candidates. The nominating and corporate governance may in the future choose to do so in those situations where particular qualifications are required or where existing contacts are not sufficient to identify an appropriate candidate.

The nominating and corporate governance committee evaluates nominees recommended by stockholders in the same manner as it evaluates other nominees. We have not received director candidate recommendations from our stockholders and we do not have a formal policy regarding consideration of such recommendations. However, any recommendations received from stockholders will be evaluated in the same manner that potential nominees suggested by members of our board of directors, management, or other parties are evaluated.

Under our amended and restated bylaws, a stockholder wishing to suggest a candidate for director should write to our corporate secretary and provide such information about the stockholder and the proposed candidate as is set forth in our amended and restated bylaws and as would be required by SEC rules to be included in a proxy statement. In addition the stockholder must include the consent of the candidate and describe any arrangements or undertakings between the stockholder and the candidate regarding the nomination. In order to give the nominating and corporate governance committee sufficient time to evaluate a recommended candidate and include the candidate in our proxy statement for the 20182021 annual meeting, the recommendation should be received by our corporate secretary at our principal executive offices in accordance with our procedures detailed in the section below entitled “Stockholder Proposals.”

Director Attendance at Annual Meetings

Although we do not have a formal policy regarding attendance by members of our board of directors at our annual meeting, we encourage all of our directors to attend. We did not hold anNo member of our board of directors attended our annual meeting of stockholders in 2016.2019.

Communications with our Board of Directors

Stockholders seeking to communicate with our board of directors should submit their written comments to our corporate secretary, Airgain, Inc., 3611 Valley Centre Drive, Suite 150, San Diego, CA 92130. The corporate

secretary will forward such communications to each member of our board of directors; provided that, if in the opinion of our corporate secretary it would be inappropriate to send a particular stockholder communication to a specific director, such communication will only be sent to the remaining directors (subject to the remaining directors concurring with such opinion).

Prohibition Against Pledging and Hedging

We maintain an Insider Trading Compliance Policy that prohibits our officers, directors, and employees pledging our stock as collateral to secure loans and from engaging in hedging transactions, including zero-cost collars and forward sale contracts. It further prohibits margin purchases of our stock, short sales of our stock, and any transactions in puts, calls, or other derivative securities involving our stock.

Corporate Governance

Our company’s Code of Business Conduct and Ethics, Corporate Governance Guidelines, Audit Committee Charter, Compensation Committee Charter, and Nominating and Corporate Governance Committee Charter are available, free of charge, on our website at www.airgain.com. Please note, however, that the information contained on the website is not incorporated by reference in, or considered part of, this proxy statement. We will also provide copies of these documents as well as our company’s other corporate governance documents, free of charge, to any stockholder upon written request to Airgain, Inc., 3611 Valley Centre Drive, Suite 150, San Diego, CA 92130.92130, Attention: Corporate Secretary.

Director Compensation

Our board of directors has approved a compensation policy for our non-employee directors. The non-employee director compensation policy provides for annual retainer fees and long-term equity awards for our non-employee directors. Pursuant to the terms of the non-employee director compensation policy, commencing with the date of our initial public offering, each non-employee director will receive an annual retainer of $30,000, with an additional $25,000 annual retainer payable to the$32,000. During 2020, from and after February 9, 2020, our chairman of the board of directors.directors will receive a cash retainer for his service as the non-employee chairman of the board for the remainder of 2020, based on an annualized rate of $240,000 per year. Commencing in 2021 our chairman of the board of directors will receive an additional $26,500 annual retainer.  Non-employee directors serving as the chairs of the audit, compensation, and nominating and corporate governance committees will receive additional annual retainers of $15,000, $10,000$16,000, $10,600 and $7,500,$8,000, respectively. Non-employee directors serving as members of the audit, compensation, and nominating and corporate governance committees will receive additional annual retainers of $7,500, $5,000$8,000, $5,300 and $3,750,$4,000, respectively. The

Each non-employee director who is newly elected or appointed to the board of directors will also receive, effective on the date of such election or appointment (or such other date specified by the board of directors), (1) an initial grant of options to purchase 10,000a number of shares of our common stock upon election tohaving a value of $50,000, calculated as of the boarddate of directors, vestinggrant in accordance with the Black-Scholes option pricing model (utilizing the same assumptions that we utilize in preparation of our financial statements and the thirty-day trailing average trading price of our common stock preceding the date of grant, or the Thirty-Day Trailing Average, plus (2) such number of restricted stock units as is determined by dividing (A) $50,000 by (B) the Thirty-Day Trailing Average, which initial awards will vest in substantially equal installments on each of the first three anniversaries of the date of grant. Thereafter, eachAll of a non-employee director’s initial awards shall vest in full immediately prior to the occurrence of a change in control, to the extent outstanding at such time.

Each non-employee director will receive an annual grantaward on the first trading day in February of each year of (1) a number of stock options having a value of $30,000 (with the award to purchase 5,000 shares of our common stock, with the chairmanchairperson of the board of directors receiving an additionalhaving a value of $45,000), calculated as of the date of grant in accordance with the Black-Scholes option to purchase 2,500 sharespricing model (utilizing the same assumptions that we use in preparation of our commonfinancial statements and the Thirty-Day Trailing Average), plus (2) such number of restricted stock vestingunits as is determined by dividing (A) $30,000 (with the award to the chairperson of the board of directors having a value of $45,000) by (B) the Thirty-Day Trailing Average, which annual awards will vest on the first to occur of the first anniversary of the date of grantgrant.  All of a non-employee director’s annual awards shall vest in full immediately prior to the occurrence of a change in control, to the extent outstanding at such time.

In addition the non-employee director compensation policy contains an ownership guideline so that members of the board of directors are required to own shares with a value of at least three times the then-current annual retainer on or before September 30, 2021, or, if later, within three years after the next occurring annual meetingdirector’s first appointment to the board of our stockholders.

directors. Compensation under our non-employee director compensation policy is subject to the annual limits on non-employee director compensation set forth in our 2016 Incentive Award Plan, referred to herein as the 2016 Plan. Our board of directors or its authorized committee may modify the non-employee director compensation programpolicy from time to time in the exercise of its business judgment, taking into account such factors, circumstances and considerations as it shall deem relevant from time to time, subject to the annual limit on non-employee director compensation set forth in the 2016 Plan. As provided in the 2016 Plan our board of directors or its authorized committee may make exceptions to this limit for individual non-employee directors in extraordinary circumstances, as the board of directors or its authorized committee may determine in its discretion, provided that the non-employee director receiving such additional compensation may not participate in the decision to award such compensation or in other compensation decisions involving non-employee directors.

Mr. Myers,Suen, who isserves as our Chief Executive Officer, receivedPresident, and a member of our board of directors receives no additional compensation for his service as a director.

Following his appointment as interim Chief Executive Officer in May 2018, Mr. Sims was generally not entitled to any additional fees or other compensation for serving as a member of the board, including any fees or equity grants in accordance with our non-employee director compensation policy, although the equity awards previously granted to him in connection with his service as a member of our board of directors will continue to vest based on his service as Chief Executive Officer. Effective February 1, 2020, in connection with his termination of employment with us and return to his status as non-executive chairman of the board of directors effective February 9, 2020, Mr. Sims again became available to receive the compensation under our non-employee director compensation policy and received the automatic annual equity awards described above in February 2020.  Subject to his remaining as a member of our board of directors, Mr. Sims' will receive a cash retainer for his service as the non-employee chairman of the board of directors for the remainder of 2020, based on an annualized rate of $240,000 per year. His annual cash retainer thereafter will be determined in accordance with our non-employee director compensation policy described above. The compensation received by Mr. MyersSims for his service as an employeechairman of the board of directors, interim Chief Executive Officer, Chief Executive Officer and Advisor to the Chief Executive Officer during 2019 is presented in “Executive Compensation—Summary Compensation Table.”

The following table sets forth information for the year ended December 31, 20162019, regarding the compensation awarded to, earned by, or paid to our non-employee directors who served on our board of directors during 2016.2019:

The table below shows the aggregate numbers of restricted stock unit and stock option awards outstanding held as of December 31, 2016 by each non-employee director who was serving as oflisted in the table above outstanding at December 31, 2016.

2019:

Vote Required; Recommendation of the Board of Directors

If a quorum is present and voting at the annual meeting, directors shall be elected by a plurality of votes cast, meaning that the two nominees receiving the highest number of votesshares voted “For” their election will be elected to our board of directors. Votes withheld from any nominee, abstentions, and broker non-votes will be counted only for purposes of determining a quorum.quorum and are not considered votes cast for the foregoing purpose. Broker non-votes will have no effect on this proposal as brokers or other nominees are not entitled to vote on such proposals in the absence of voting instructions from the beneficial owner.

OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR“FOR” THE ELECTION OF CHARLES MYERSTZAU-JIN CHUNG AND JAMES K. SIMS. PROXIES SOLICITED BY THE BOARD OF DIRECTORS WILL BE SO VOTED UNLESS STOCKHOLDERS SPECIFY OTHERWISE ON THEIR PROXY CARDS.OTHERWISE.

PROPOSALPROPOSAL 2:

RATIFICATION OF SELECTIONAPPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The audit committee has selectedappointed KPMG LLP as the company’s independent registered public accounting firm for the year ending December 31, 20172020 and has further directed that management submit the selectionappointment of independent registered public accounting firm for ratification by the stockholders at the annual meeting. KPMG LLP has audited the company’s financial statements since 2012. Representatives of KPMG LLP are expected to be present online at the annual meeting, will have an opportunity to make a statement if they so desire, and will be available to respond to appropriate questions.

Stockholder ratification of the selectionappointment of KPMG LLP as the company’s independent registered public accounting firm is not required by Delaware law, the company’s amended and restated certificate of incorporation, or the company’s amended and restated bylaws. However, the audit committee is submitting the selectionappointment of KPMG LLP to the stockholders for ratification as a matter of good corporate practice. If the stockholders fail to ratify the selection,appointment the audit committee will reconsider whether to retain that firm. Even if the selectionappointment is ratified the audit committee in its discretion may direct the appointment of different independent registered accounting firm at any time during the year if the audit committee determines that such a change would be in the best interests of the company and its stockholders.

Independent Registered Public Accounting Firm’s Fees

The following table represents aggregate fees billed to us for services related to the fiscal years ended December 31, 2016 and 2015, by KPMG LLP, our independent registered public accounting firm.

firm for services related to the years ended December 31 (in thousands):

The audit committee has considered whether the provision of non-audit services is compatible with maintaining the independence of KPMG LLP and has concluded that the provision of such services is compatible with maintaining the independence of our auditors.

Pre-Approval Policies and Procedures

Our audit committee has established a policy that all audit and permissible non-audit services provided by our independent registered public accounting firm will be pre-approved by the audit committee and all such services were pre-approved in accordance with this policy during the fiscal years ended December 31, 20162019 and 2015.2018. These services may include audit services, audit-related services, tax services, and other services. The audit committee considers whether the provision of each non-audit service is compatible with maintaining the independence of our auditors. Pre-approval is detailed as to the particular service or category of services and is generally subject to a specific budget. Our independent registered public accounting firm and management are required to periodically report to the audit committee regarding the extent of services provided by the independent registered public accounting firm in accordance with this pre-approval and the fees for the services performed to date.

Vote Required; Recommendation of the Board of Directors

The affirmative vote of the holders of a majority in voting power of the votes cast affirmatively or negatively on the proposal will be required to ratify the selectionappointment of KPMG LLP.LLP, meaning the number of shares voted “For” the proposal must exceed the number of shares voted “Against” the proposal. Abstentions will not be counted toward the tabulation of votes cast on this proposal and will have no effect on the proposal. The approval of Proposal 2 is a routine proposal on which a broker or other nominee has discretionary authority to vote. Accordingly no broker non-votes will likely result from this proposal.

OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE TO RATIFY“FOR” THE SELECTIONRATIFICATION OF THE APPOINTMENT OF KPMG LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING DECEMBER 31, 2017.2020. PROXIES SOLICITED BY THE BOARD OF DIRECTORS WILL BE SO VOTED UNLESS STOCKHOLDERS SPECIFY OTHERWISE ON THEIR PROXY CARDS.OTHERWISE.

SECURITY OWNERSHIPOWNERSHIP OF CERTAIN

BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth information relating to the beneficial ownership of our common stock as of April 18, 2017,27, 2020, by:

The number of shares beneficially owned by each stockholder, executive officer, or director is determined in accordance with SEC rules. Under such rules, beneficial ownership includes any shares over which the person or entity has sole or shared voting power or investment power as well as any shares that the person has the right to acquire within 60 days of April 18, 201727, 2020, through the exercise of any stock options, warrants, or other rights. Except as otherwise indicated, and subject to applicable community property laws, to our knowledge, the persons named in the table have sole voting and investment power with respect to all shares of common stock held by that person.Forperson. For purposes of calculating each person’s or group’s percentage ownership, stock options, warrants, and other rights exercisable within 60 days after April 18, 201727, 2020, are included for that person o but not for any other person.

The percentage of shares beneficially owned is based on 9,488,0579,696,557 shares of our common stock outstanding as of April 18, 2017.27, 2020. Unless otherwise noted below, the address of each person listed on the table is c/o Airgain, Inc., 3611 Valley Centre Drive, Suite 150, San Diego, CA 92130.

EXECUTIVE COMPENSATION AND OTHER INFORMATION

Our Executive Officers

The following table sets forth information regarding our executive officers as of April 18, 2017:27, 2020:

The biography of Charles Myersfor Mr. Suen can be found under “Proposal"Proposal 1—Election of Directors.”"

Leo Johnson

David B. Lyle has served as our Chief Financial Officer since July 2014. From December 2012January 2020. Prior to June 2014,that Mr. JohnsonLyle served as a consultant to us. From September 2001the Chief Financial Officer of Sunniva, Inc. from June 2019 to November 2011, Mr. Johnson held several financial positions at Verisign, Inc. including Director of Finance, a position2019. Prior to Sunniva he held since 2003. From 1998 to 2001, Mr. Johnson served aswas Chief Financial Officer at PlanningMaxwell Technologies, Inc., a professional services company focused on network infrastructure and architecture that from May 2015 to May 2019, which was acquired by Red HatTesla in 2019. Mr. Lyle served as the Chief Financial Officer of Entropic Communications, Inc. from 2007 to 2015, which was acquired in 2015 by MaxLinear, Inc. Prior to Entropic he served as the Chief Financial Officer of RF Magic Inc., acquired by Entropic in 2007, Zyray Wireless Inc., acquired by Broadcom Corporation in 2004, and Mobilian Corporation, acquired by Intel Corporation in 2003. Mr. JohnsonLyle holds a B.B.A.BS in Accountingbusiness administration from University of Southern California, a Master of International Management from the UniversityThunderbird School of Georgia, Athens, Georgia.Global Management, and an MBA from Arizona State University.

Glenn Selbo

Kevin Thill has served as our Chief Operating OfficerSenior Vice President, Engineering since June 2012.January 2019.  He has been with the company since its inception in November 2003, servingApril 2017 as the Vice President, Business DevelopmentAntenna-Plus.  Prior to that Mr. Thill founded Antenna Plus, LLC in 1991 and Marketingwas the owner until its acquisition by us in 2017.  Prior to Antenna Plus Mr. Thill was a Senior Antenna Design Engineer at Motorola.  Prior to Motorola Mr. Thill was an Antenna Engineer at Northrop and prior to that he was an Antenna Engineer at McDonald Douglass. Mr. Thill received a BS in Electrical Engineering from October 2006 to June 2012 and Vice President, Sales & Marketing from January 2004 to October 2006. Previously, Mr. Selbo served as Senior Director of Sales and Marketing for Powerwave Technologies, where he oversaw marketing and product management activities for cellular power amplifier solutions and as Vice President of Strategic Marketing for Wireless Facilities, a wireless network services firm. Mr. Selbo also served as Vice President of Marketing for VoltDelta, an application service provider in the wireless space, and Director of Global Market Development for Unisys Corporation. Mr. Selbo began his wireless career with AirTouch Communications, where he held several marketing and business development positions in the company’s U.S. and international operations. Mr. Selbo received his M.B.A. from the University of Southern California and B.A. in Finance from CaliforniaArizona State University, Fullerton.University.

Overview

This section discusses the material components of the executive compensation program for our executive officers who are named in the “Summary Compensation Table” below. In 2016,2019 our “named executive officers” and their positions were as follows:

Glenn Selbo, Chief Operating Officer.

This discussion may contain forward-looking statements that are based on our current plans, considerations, expectations, and determinations regarding future compensation programs. Actual compensation programs that we adopt in the future may differ materially from the currently planned programs summarized in this discussion.

Summary Compensation Table

Summary Compensation Table

The following table presents information regarding compensation earned by or awards to our named executive officers during 20152019 and 2016.

2018:

Narrative Disclosure to Summary Compensation Table

Employment and Consulting Agreements

We have entered into employment agreements with each of our executive officers.

Employment Agreement

Arrangements with Mr. MyersSims

From May 8, 2018, through March 13, 2019, Mr. Sims served as our non-employee interim Chief Executive Officer. In consideration of his service as interim Chief Executive Officer, Mr. Sims received a monthly retainer of $33,333.33, which equated to an annual retainer of $400,000. Mr. Sims was also eligible to be awarded a discretionary bonus by our board of directors in connection with his service as interim Chief Executive Officer.

Original Employment Agreement

On October 25, 2018, the Board approved the entry by us into an employment agreement with Mr. Sims, which agreement was designed to cover his future service as Executive Chairman and interim Chief Executive Officer. The employment agreement with Mr. Sims became effective on February 16, 2019, at which time Mr. Sims became an employee of the company and Executive Chairman in addition to interim Chief Executive Officer.

Effective March 13, 2019, Mr. Sims was appointed Chief Executive Officer in addition to his role as Executive Chairman. Mr. Sims served in these roles until Mr. Suen's appointment as Chief Executive Officer effective August 8, 2019. On that date Mr. Sims resigned as Chief Executive Officer and was appointed as Advisor to the Chief Executive Officer in addition to his role as Chairman of the Board of Directors, and we executed an amended

employment agreement with him as described below. On February 9, 2020, Mr. Sims’ employment ceased and he continues as our non-employee Chairman of the Board of Directors.

During the term of his employment under his employment agreement, Mr. Sims received an annual base salary of $400,000. Mr. Sims was also eligible to receive an annual incentive bonus in the discretion of our board of directors (with a target bonus of 90% of his base salary). Mr. Sims was also be entitled to participate in all employee benefit plans, programs and arrangements maintained by us and made available to employees generally and to receive reimbursement for all reasonable and necessary business expenses incurred by him.  Mr. Sims, who did not participate in the company's healthcare plans, was also provided with a monthly reimbursement of his healthcare premiums under his individually obtained health coverage.

Pursuant to his employment agreement effectivein effect prior to the August amendment and his role conversion, if we terminated Mr. Sims’ employment without cause (as defined in the employment agreement) or he resigned for 2016, Mr. Myers wasgood reason (as defined in the employment agreement), in addition to the payment of his fully earned but unpaid base salary through the date of termination at the rate then in effect, plus all other amounts under any compensation plan or practice to which he is entitled, he would have been entitled to the following severance and benefits, subject to his execution of a release of claims against us: (1) a lump sum cash payment in an annualamount equal to (A) if his employment were terminated prior to December 31, 2020, his base salary as in effect immediately prior to the date of $360,000his termination for a period of up to 18 months (which severance period will be prorated between 18 months and a target annual bonus in the amount6 months depending on his length of 75%service following February 16, 2018 through December 31, 2020), or (B) six months of his annual base salary.  On April 25, 2017,salary as in effect immediately prior to the date of this termination if his employment were terminated on or after December 31, 2020; (2) a lump sum cash payment in an amount equal to his full target bonus for the calendar year during which such date of termination occurs; (3) the continuation of his health and dental coverage pursuant to COBRA at our Compensation Committee approvedexpense for the applicable severance period of 6 months following the date of termination; and (4) full acceleration of his outstanding equity awards. In addition, all of Mr. Sims’ equity awards will vest in the event of a change in control, without regard to his termination of employment.  Notwithstanding the foregoing, no severance was payable in the event Mr. Sims’ termination without cause or resignation for good reason occurred after February 16, 2021.

If Mr. Sims’ employment were terminated as a result of his death or following his permanent disability, in addition to the payment of his fully earned but unpaid base salary through the date of termination at the rate then in effect, plus all other amounts under any compensation plan or practice to which he is entitled, he or his estate, as applicable, he was entitled to a lump sum cash payment in an increaseamount equal to his "earned" bonus for the calendar year during which his date of termination occurred calculated as of the date of termination (wherein “earned” means that he has met the applicable bonus metrics as of date of such termination, as determined by the board of directors), prorated for such portion of the calendar year during which such termination occurred that has elapsed through the date of termination.

August 2019 Amended Employment Agreement

Effective August 8, 2019, Mr. Myers’Sims’ employment agreement was amended and restated to reflect his new role as Advisor to the Chief Executive Officer and chairman of the board of directors. The amended employment agreement with Mr. Sims provided for a fixed term, which expired on February 9, 2020, unless earlier terminated by us or Mr. Sims, and the same annual base salary, target bonus and additional employee benefits and medical reimbursements as were in place under his original employment agreement described above.  

If Mr. Sims’ employment under his amended employment agreement were terminated prior to $400,000the expiration of the term by us without cause or by him for good reason, in addition to the payment of his fully earned but unpaid base salary through the date of termination at the rate then in effect, plus all other amounts under any compensation plan or practice to which he is entitled, he would have been entitled to the following severance and an increasebenefits, subject to his execution of a release of claims against us: (1) a lump sum cash payment equal to his base salary through the last day of the term of the agreement; (2) a lump sum cash payment equal to his target annual bonus (if such termination occurred prior to 90%December 31, 2019; (3) the continuation of his annual base salary.health and dental coverage pursuant to COBRA at our expense through the last day of the term of the agreement; and (4) full acceleration of his outstanding equity awards. His benefits upon a termination for death or disability during the term of the amended employment agreement were the same as those under his original employment agreement described above.

Interaction of Employment Agreement with Non-Employee Director Compensation Policy

PursuantFollowing his appointment as interim Chief Executive Officer in May 2018, Mr. Sims was generally not entitled to any additional fees or other compensation for serving as a member of the board. Commencing February 1, 2020, Mr. Sims again became eligible to receive equity grants in accordance with our non-employee director compensation policy. After the end of his employment term on February 9, 2020, subject to his remaining as a member of our board of directors, Mr. Simswill receive a cash retainer for his service as the non-employee chairman of the board of directors for the remainder of 2020, based on an annualized rate of $240,000 per year. His annual cash retainer thereafter will be determined in accordance with our non-employee director compensation policy.

Mr. Sims was not present for the deliberations or decision by our board of directors when it approved his compensation arrangements during his service as Executive Chairman, Chief Executive Officer, or Advisor to the employment agreementChief Executive Officer.

Employment Agreements with Mr. Myers, ifSuen, Mr. Thill, and Mr. Doradla

Effective January 16, 2019, we terminateentered into amended employment agreements with each of Jacob Suen, our President, Anil Doradla, our Chief Financial Officer and Secretary, and Kevin Thill, our Senior Vice President, Engineering. Mr. Doradla resigned effective November 30, 2019. Mr. Suen's agreement was amended in connection with his promotion to Chief Executive Officer in August 2019 to reflect his increased base salary, as described above. In addition, we further amended the employment agreements with Mr. Suen and Mr. Thill in April 2020 to increase the severance payable in the event of a termination without cause (as defined below) or he resignsa resignation for good reason (as defined below), other than in connection with a change in control, from 6 months to 12 months, as described below.

The amended and restated employment agreements provide for an indefinite term and for at-will employment. The agreements also set forth each executive's annual base salary and target bonus opportunity and provide that each executive will be entitled to the benefits provided to employees generally.

Pursuant to the amended employment agreements, if we terminate an executive's employment without cause or he resigns for good reason , he is entitled to the following payments and benefits: (1) his fully earned but unpaid base salary through the date of termination at the rate then in effect, plus all other amounts under any compensation plan or practice to which he is entitled; (2) a lump sum cash payment in an amount equal to 12 months of his base salary as in effect immediately prior to the date of termination plus an amount equal to his target bonus for the calendar year during which his date of termination occurs, prorated for such portion of the calendar year during which such termination occurs that has elapsed through the date of termination; and (3) continuation of health benefits at our expense for a period of 6 months following the date of termination.

In the event an executive's termination without cause or resignation for good reason occurs within 12 months following a change in control, he is entitled to the following payments and benefits: (1) his fully earned but unpaid base salary through the date of termination at the rate then in effect, plus all other amounts under any compensation plan or practice to which he is entitled; (2) a lump sum cash payment in an amount equal to 12 months of his base salary as in effect immediately prior to the date of termination; (3) a lump sum cash payment in an amount equal to his “earned” bonus for the calendar year during which his date of termination occurs calculated as of the date of termination (wherein “earned” means that he has met the applicable bonus metrics as of date of such termination, as determined by the board of directors), prorated for such portion of the calendar year during which such termination occurs that has elapsed through the date of termination; (4) a lump sum cash payment in an amount equal to 12 multiplied by the monthly premium payable by Mr. Myers (or by us on his behalf) for disability insurance under our disability insurance plans in which Mr. Myers was participating immediately prior to the date of termination, payable in a lump sum on the date that is 30 days following the date of termination; and (5) continuation of health benefits at our expense for a period of 12 months following the date of termination.

In the event Mr. Myers termination without cause or resignation for good reason occurs within 12 months following a change in control, he is entitled to the following payments and benefits: (1) his fully earned but unpaid base salary through the date of termination at the rate then in effect, plus all other amounts under any compensation plan or practice to which he is entitled; (2) a lump sum cash payment in an amount equal to 18 months of his base salary as in effect immediately prior to the date of termination; (3) a lump sum cash payment in an amount equal to his target bonus for the year in which the termination of his employment occurs; and (4) continuation of health benefits at our expense for a period of 18 months following the date of termination;termination. All of an executive's outstanding equity awards will become fully vested and (5)exercisable in the event of a lump sum cash paymenttermination without cause or resignation for good reason at any time following a change in an amount equal to 18 multiplied by the monthly premium payable by Mr. Myers (or by us on his behalf) for disability insurance under our disability insurance plans in which Mr. Myers was participating immediately prior to the date of termination, payable in a lump sum on the date that is thirty (30) days following the date of termination.control.

If Mr. Myers’an executive's employment is terminated as a result of his death or following his permanent disability, Mr. Myershe or his estate, as applicable, is entitled to the following payments and benefits: (1) his fully earned but unpaid base salary through the date of termination at the rate then in effect, plus all other amounts under any compensation plan or practice to which he is entitled; and (2) a lump sum cash payment in an amount equal to his “earned” bonus for the calendar year during which his date of termination occurs calculated as of the date of termination (wherein “earned” means that he has met the applicable bonus metrics as of date of such termination, as determined by the board of directors), prorated for such portion of the calendar year during which such termination occurs that has elapsed through the date of termination.

Pursuant to his employment agreement, Mr. Myers received a one-time cash retention bonus in the amount of $500,000 on the closing of our initial public offering in August 2016.

Employment Agreements with Messrs. Johnson and Selbo

Pursuant to his employment agreement, for 2016, Mr. Selbo was entitled to an annual base salary of $225,000, and a target annual bonus in the amount of 50% of his annual base salary. On April 25, 2017, our Compensation Committee approved an increase to Mr. Selbo’s annual base salary to $300,000 and an increase to his target annual bonus to 75% of his annual base salary.  Mr. Johnson entered into his employment agreement effective July 28, 2014, the date he commenced employment with us. Pursuant to his employment agreement, for 2016, Mr. Johnson was entitled to an annual base salary of $225,000 and a target annual bonus in the amount of 50% of his annual base salary.  On April 25, 2017, our Compensation Committee approved an increase to Mr. Johnson’s annual base salary to $300,000 and an increase to his target annual bonus to 60% of his annual base salary.  Pursuant to their employment agreements, if we terminate such officer’s employment without cause (as defined below) or such officer resigns for good reason (as defined below), the executive officer is entitled to the following payments and benefits: (1) his fully earned but unpaid base salary through the date of termination at the rate then in effect, plus all other amounts under any compensation plan or practice to which he is entitled; (2) a lump sum cash payment in an

amount equal to 6 months of his base salary as in effect immediately prior to the date of termination; and (3) continuation of health benefits at our expense for a period of 6 months following the date of termination.

In the event an officer’s termination without cause or resignation for good reason occurs within 12 months following a change in control, the executive officerMr. Suen is entitled to the following payments and benefits: (1) his fully earned but unpaid base salary through the date of termination at the rate then in effect, plus all other amounts under any compensation plan or practice to which he is entitled; (2) a lump sum cash payment in an amount equal to 12 months of his base salary as in effect immediately prior to the date of termination; (3) a lump sum cash payment in an amount equal to his target bonusnot present for the year in which the termination of his employment occurs; and (4) continuation of health benefits atdeliberations or decision by our expense for a period of 18 months following the date of termination.  

If an officer’s employment is terminated as a result of his death or following his permanent disability, the executive officer or his estate, as applicable, is entitled to the following payments and benefits: (1) his fully earned but unpaid base salary through the date of termination at the rate then in effect, plus all other amounts under any compensation plan or practice to which he is entitled; and (2) a lump sum cash payment in an amount equal to his “earned” bonus for the calendar year during which his date of termination occurs calculated as of the date of termination (wherein “earned” means that the executive officer has met the applicable bonus metrics as of date of such termination, as determined by the board of directors), prorated for such portion of the calendar year during which such termination occurs that has elapsed through the date of termination.directors when it approves his compensation arrangements.

Defined Terms Applicable to Executive Employment Agreements

For purposes of the executive employment agreements, “cause” generally means an executive officer’s (1) material breach of his employment agreement, his confidentiality and inventions assignment agreement or the definitive agreements relating to his stock option awards; (2) continued substantial and material failure or refusal to perform according to, or to comply with, the policies, procedures or practices established by us; (3) appropriation (or attempted appropriation) of a material business opportunity of the company, including attempting to secure or securing any personal profit in connection with any transaction entered into on our behalf; (4) misappropriation (or attempted appropriation) of any of our funds or property of any kind; (5) willful gross misconduct; or (6) conviction of a felony involving moral turpitude that is likely to inflict or has inflicted material injury on our business; provided, however, that except for Cause being the result of item (6) above, we will provide written notice to the executive officer, which notice specifically identifies the nature of the alleged cause claimed by us with enough specificity for the executive officer to be able to cure, and the executive officer will have 15 days to cure the purported ground(s) for cause.

For purposes of the executive employment agreements, “good reason” generally means (1) a material reduction in the executive officer’s authority, duties or responsibilities relative to the executive officer’s authority, duties or responsibilities in effect immediately prior to such reduction; as set forth in his employment agreement; (2) a material reduction in the executive officer’s annual base salary (or,salary; (3) other than for Mr. Myers, his target cash compensation); (3)Sims, a relocation of the executive officer’s or our principal executive offices to a location outside of San Diego County, if the executive officer’s principal office is at such offices;by more than 25 miles, or (4) any material breach by us or any successor or affiliate of obligations to the executive officer under the employment agreement; or (5) for Mr. Myers, the assignment to him of any duties materially inconsistent with his status as an executive officer.agreement.

For purposes of the employment agreements, “change in control” generally means (1) any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) (other than us, any of our subsidiaries, or any existing shareholder)stockholder) becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of our securities representing 50% or more of the total voting power represented by our then outstanding voting securities, (2) during any period of two consecutive years, individuals who, at the beginning of such period, constitute our board together with any new directors whose election by the board or nomination for election was approved by aa vote of at least 2/3 of the then-current board members who were directors at the beginning of the period or whose election or appointment was so approved, cease for any reason to constitute a majority of the board of directors, or (3) the consummation of the sale liquidation or disposition by us of all or substantially all of our assets, (3)or the consummation of a merger, consolidation, reorganization business combination, or other similar transaction involving us,acquisition of assets or stock of another entity, in each case in which our voting securities outstanding immediately prior thereto do not continue to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its parent) at least 50%

a majority of the combined voting power represented by our voting securities orof such surviving entity or its parent outstanding immediately after such transaction and no “person” owns 50% or (4)more of the surviving entity or its parent.

Consulting Agreement with Mr. Doradla

Following his resignation in November 2019, Mr. Doradla entered into a consulting agreement with us pursuant to which he agreed to provide transition services to us through February 2020. Mr. Doradla received a monthly retainer of $5,000 for Mr. Myers,such service, and his outstanding stock options continued to vest during any periodthe term of two consecutive years, individuals who,his consulting services (with the exception of his August 2019 stock option award, which was forfeited as he was unable to meet the initial vesting requirement).  His unvested restricted stock units, however, were forfeited upon his resignation of employment.

Annual Base Salary

In general, base salaries for our named executive officers are initially established through arm’s length negotiation at the beginningtime the executive is hired, taking into account such executive’s qualifications, experience and prior salary. Base salaries of such period, constituteour named executive officers are approved and reviewed annually by our compensation committee or board of directors and adjustments to base salaries are based on the scope of an executive’s responsibilities, individual contribution, prior experience and sustained performance. Decisions regarding salary increases may take into account an executive officer’s current salary, equity ownership, and the amounts paid to an executive officer’s peers inside our company by conducting an internal analysis, which compares the pay of an executive officer to

other members of the management team. Base salaries are also reviewed in the case of promotions or other significant changes in responsibility. Base salaries are not automatically increased if the compensation committee or the board of directors togetherbelieves that other elements of the named executive officer’s compensation are more appropriate in light of our stated objectives. This strategy is consistent with any new director(s) (other thanour intent of offering compensation that is cost-effective, competitive and contingent on the achievement of performance objectives.

Mr. Sims was compensated at the annual rate of $400,000 for his service during 2019 in the various capacities described above. Mr. Suen's annual base salary for 2019 was $310,000. In connection with appointment as Chief Executive Officer in August 2019, our board of directors increased Mr. Suen's annual salary to $400,000. Mr. Thill's annual base salary was increased from $230,000 to $275,000 effective January 1, 2019 in connection with his promotion to Senior Vice President, Engineering. Mr. Doradla's annual base salary for 2019 was $325,000.

Annual Cash Bonus

The compensation committee adopted a director designated by2019 annual bonus program for our named executive officers. Pursuant to his employment agreement, Mr. Sims’ annual bonus was in the discretion of the board of directors, although he had a person who shall have entered intotarget bonus equal to 90% of his base salary. The target bonus as a percentage of annual base salary was 90% for Mr. Suen and 60% for each of Messrs. Thill and Doradla. Mr. Doradla was not eligible for a 2019 annual bonus as a result of his resignation in November 2019.

Under the 2019 annual bonus program 90% of each executive’s annual bonus was tied to corporate revenue and (weighted at 40%) and adjusted EBITDA performance (weighted at 50%), with “threshold,” “target” and “maximum” performance levels corresponding to the payout levels for the corporate component of each executive’s target annual bonus payout (with target performance representing a 100% payout level for each financial measure and maximum or greater performance representing a 150% payout level for each financial measure). The other 10% of an agreement with usexecutive’s annual bonus was to effect a transaction describedbe determined in clause (1) or (3)the discretion of this definition) whose election by the board of directors or nomination for election by our shareholders was approved by a vote of at least a majority of the directors then still in office who either were directors atcompensation committee based on the beginning ofexecutive’s individual performance and such other factors as the two-year period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority thereof.

Annual Cash Bonus

For 2016, Mr. Myers, Mr. Johnson and Mr. Selbo were eligible for target bonuses equal to 75%, 50% and 50% of their respective base salaries. The executives’ bonuses for 2016 were determined in the discretion of our board of directors or the compensation committee deems appropriate, with a maximum payout level of 150%.

Our compensation committee and board of directors,  determined that, based on its subjective assessmentour sales and adjusted EBITDA performance for 2019, our executive annual bonuses would be paid at 68% of bothtarget based on our corporatesales of $55.739 million and our adjusted EBITDA of $3.732 million for 2019.  Adjusted EBITDA is a non-GAAP measure that our compensation committee and board of directors determined to use in connection with the annual bonus program because, by excluding certain non-cash expense, adjusted EBITDA allows for meaningful comparisons between our core business operating results and those of other companies, as well as providing us with an important tool for financial and operational decision making and for evaluating our own core business operating results over different periods of time. Management considers these types of expenses and adjustments, to a great extent, to be unpredictable and dependent on a significant number of factors that are outside of our control and are not necessarily reflective of operational performance during a period. For purposes of our 2019 annual bonus program, adjusted EBITDA represents our earnings before interest, taxes, depreciation, amortization, and their individual performance. also excluding stock-based compensation expense, which represents non-cash charges for the fair value of stock awards, and includes other income, which includes interest income and gain on deferred purchase price liability offset by interest expense. Based on this assessment our board of directors determined to award our named executive officers the following 2019 bonuses: Mr. Myers aSims, $244,800; Mr. Suen, $212,670; and Mr. Thill, $112,200. Although Mr. Sims’ annual bonus was in the discretion of $300,000the board of directors, his annual bonus payout was determined based on the same percentage payout as our other executives for 2016, representing 83% of his base salary for 2016, determined to award Mr. Johnson a bonus of $200,000 for 2016, representing 89% of his base salary for 2016, and determined to award Mr. Selbo a bonus of $125,000 for 2016, representing 56% of his base salary for 2016.2019.

Equity Compensation

We primarily offer stock options to our named executive officers as the long-term incentive component of our compensation program. Our stock options allow employees to purchase shares of our common stock at a price per share equal to the fair market value of our common stock on the date of grant and may or may not be intended to qualify as “incentive stock options” for U.S. federal income tax purposes. In the past, our board of directors has determined the fair market value of our common stock based upon inputs including valuation reports prepared by third-party valuation firms from time to time. Generally, the stock options we grant vest over four years, subject to the employee’s continued employment with us on the vesting date. We also, when appropriate, grant restricted stock or restricted stock units to our executives.executives, as we did in 2019.

Our board of directors has adopted, and our stockholders have approved, the 2016 Incentive Award Plan, referred to herein as the 2016 Plan, in order to facilitate the grant of cash and equity incentives to directors, employees (including our named executive officers) and consultants

of our company and certain of its affiliates and to enable our company and certain of its affiliates to obtain and retain services of these individuals, which is essential to our long-term success.

In May 2016, each of

On January 16, 2019, Mr. Myers,Sims, Mr. SelboSuen, Mr. Thill, and Mr. JohnsonDoradla received stock option awards.options to purchase 50,000 shares, 87,500 shares, 25,000 shares and 37,500 shares, respectively. The options were granted with an exercise price per share of $1.90, which was equal to the fair market value per share of our commonclosing stock at the time ofprice on the grant as determined pursuant to an independent third party valuation.date. The options have a term of ten years from the date of grant. Mr. Myers was granted time-based stockThe options to purchase 26,125 shares of our common stock, which stock option vestsvest over four years, with 25% of the shares subject to the option vesting on the first anniversary of the date of grantJanuary 1, 2020, and the remainder vesting in equal monthly installments over a period of three years thereafter, subject to histheir continued employment or service with us on each vesting date.

On January 16, 2019, Mr. Sims, Mr. Suen, Mr. Thill, and Mr. Doradla received 20,326 restricted stock units, 35,570 restricted stock units, 10,163 restricted stock units, and 15,244 restricted stock units, respectively, which awards vest in four equal installments beginning on March 1, 2020, and each of the following three years, subject to continued employment with us on each vesting date. The time-based options will vest on an accelerated basis

On August 12, 2019, in the event of a change in control (as defined inconnection with his employment agreement), or in the event ofappointment as Chief Executive Officer, Mr. Myers’ termination of employment by us without cause (as defined in his employment agreement), his resignation for good reason (as defined in his employment agreement), his death or his termination of employment by reason of his disability (as defined in his employment agreement).

Each of Mr. Selbo and Mr. JohnsonSuen was granted 13,062 time-based stock options, which also vest over four years. These time-based options will vest on an accelerated basis in the event of the employee’s termination of employment by us without cause (as defined in his employment agreement) or his resignation for good reason (as defined in his employment agreement), in each case following a change in control.

Mr. Myers also received performance-based stock options to purchase 26,125 shares250,000 shares. On that same date Mr. Doradla was granted stock options to purchase 100,000 shares. The options were granted with an exercise price per share equal to the closing stock price on the grant date. The options have a term of our common stock, which stock option veststen years from the date of grant. In each case the options vest over four years, with 25% of the shares subject to the option vestedvesting on the first anniversary of the date of grantAugust 8, 2020, and the remainder vesting in equal monthly installments over a period of three years thereafter, subject to his continued employment or service with us on each vesting date; provided, however, that the number of shares subject to the option that would have been eligible to vest in accordance with the foregoing schedule was to be determined based on our revenues and net income for 2016 in accordance with the following table (with results not to be interpolated between the listed data points).  As a result, our revenues and net income were required to both equal or exceed the levels set forth above in order for vesting to occur at such level.  date.

Notwithstanding the foregoing, the vesting eligible shares subjectThe options granted to the option would have become fully vestedeach of Messrs. Suen and exercisableThill will vest on an accelerated basis in the event of a change in control; provided that, to the extent such change in control occurred during 2016, Mr. Myers would have vested in 100% of the shares subject to the option on the date of such change in control. In addition, the vesting eligible shares would have become fully vested and exercisable in the event of Mr. Myers’their termination of employment by us without cause (as defined in his employment agreement), hisor their resignation for good reason, (as defined his employment agreement), his death or his termination of employment by reason of his disability (as defined in his employment agreement); provided that, to the extent such termination of employment occurred during 2016, Mr. Myers would have vested in 100% of the shares subject to the option on the date of such termination of employment.  For 2016, our revenues exceeded $43.4 million and our net income exceeded $3.7 million resulting in 100% of these options becoming eligible to vest pursuant to the time-based schedule described above at the end of 2016 based on such performance.

Each of Mr. Selbo and Mr. Johnson also received performance-based stock options to purchase 13,062 shares of our common stock, which stock options vest over four years, with 25% of the shares subject to the options vesting on the first anniversary of the date of grant and the remainder vesting in equal monthly installments over a period of three years thereafter, subject to the employee’s continued employment with us on each vesting date; provided, however, that the number of shares subject to the option that would have been eligible to vest in accordance with the foregoing schedule were to be determined based on our revenues for 2016 in accordance with the following table (with results not to be interpolated between the listed data points).  As a result, our revenues and net income were required to both equal or exceed the levels set forth above in order for vesting to occur at such level.

Notwithstanding the foregoing, if a change in control occurred during 2016, 100% of the shares subject to the option would have been deemed to be vesting eligible shares and would have been eligible to vest in accordance with the foregoing time-based schedule and the foregoing performance vesting provisions would have ceased to apply. The vesting eligible shares, if any, would have become fully vested and exercisable in the event of the employee’s termination of employment by us without cause (as defined in his employment agreement) or his resignation for good reason (as defined in his employment agreement), in each case following a change in control.  For 2016, our revenues exceeded $43.4 million and our net income exceeded $3.7 million resulting in 100% of these options becoming eligible to vest pursuant to the time-based schedule described above at the end of 2016 based on such performance.

In May 2016, each of Mr. Selbo and Mr. Johnson received performance-based restricted stock awards with respect to 36,575 and 20,900 shares, respectively. The shares vested on February 7, 2017, the date that was six months and one day following the closing date of our initial public offering. In addition, the shares also would have vested in the event of a change in control prior to December 31, 2016, or in the event of the employee’s termination of employment by us without cause (as defined in his employment agreement), or his resignation for good reason (as defined in his employment agreement).

Stock awards granted to our named executive officers may be subject to accelerated vesting in certain circumstances. For additional discussion, please see “—Employment and Consulting Agreements” above, “—Change in Control Benefits” below and “Outstanding Equity Awards at the End of 2016” below.above.

Other Elements of Compensation

Retirement Plans

We currently maintain a 401(k) retirement savings plan that allows eligible employees to defer a portion of their compensation, within limits prescribed by the Internal Revenue Code, or the Code, on a pre-tax basis through contributions to the plan. Our named executive officers are eligible to participate in the 401(k) plan. We may make discretionary matching contributions under the 401(k) plan, but we have not done so to date. We believe that providing a vehicle for tax-deferred retirement savings through our 401(k) plan adds to the overall desirability of our executive compensation package and further incentivizes our named executive officers in accordance with our compensation policies.

Employee Benefits and Perquisites

Our named executive officers are eligible to participate in our health and welfare plans. In addition, pursuantMr. Sims, who did not participate in the company's healthcare plans during his service as interim Chief Executive Officer, Chief Executive Officer, and Advisor to his employment agreement, Mr. Myers is entitled to receive the following additional benefits with an aggregate annual cost not to exceed $20,000: (1) annual executive medical program; (2) health club dues/personal trainer; and (3)Chief Executive Officer, was provided a monthly reimbursement of monthly vehicle payment, plus the costs of maintenance and operation of such vehicle.his healthcare premiums under his individually obtained health coverage. We do not provide our named executive officers with any other significant perquisites or other personal benefits.

Termination or Change in Control Benefits

Our named executive officers may become entitled to certain benefits or enhanced benefits in connection with a change in controlcertain terminations of our company. Each of our named executive officers’ employment agreements entitles them to accelerated vesting of all outstanding equity awards, as well as certain other benefits, uponor a change in control of our company. For additional discussion, please see “—Employment and Consulting Agreements” above.

Outstanding Equity Awards at the End of 20162019

The following table summarizes the number of shares of common stock underlying outstanding equity incentive plan awards for each named executive officer as of December 31, 2016.2019: