| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
Amended Employment Agreement
On October 27, 2022, D-Wave Commercial Inc. (“D-Wave Commercial”), a wholly-owned subsidiary of D-Wave Quantum Inc. (the “Company”), entered into an amendment (the “Amendment”) to the Full-Time Amended and Restated Employment Agreement, dated as of January 1, 2020, with its President and Chief Executive Officer, Alan Baratz (as amended, the “Employment Agreement”), to reflect updates to Mr. Baratz’s compensation arrangements as approved by the Company’s Board of Directors (the “Board”) upon the recommendation of the Compensation Committee of the Board.
The Board authorized the Amendment in recognition of Mr. Baratz’s significant contributions to the Company and prior service, in particular in taking the Company public, and to incentivize future performance.
Pursuant to the Amendment, the Company has increased Mr. Baratz’s annual base salary to $575,000 per annum, effective as of September 1, 2022, and granted Mr. Baratz’s eligibility to participate in the D-Wave 2022 Bonus Plan and any future performance-based bonus plans that apply to the Company’s Chief Executive Officer. Effective as of September 1, 2022, Mr. Baratz’s on-target bonus under the D-Wave 2022 Bonus Plan is 100% of Mr. Baratz’s base salary, based on achievement of the corporate objectives under the plan, and personal objectives set by the Board. Certain changes were also made to the termination provisions of the Employment Agreement to provide that, upon a termination without cause, the Company shall provide twelve months’ base salary as a lump sum payment, twelve months base salary continuance, or a combination of the two, plus a lump sum target bonus payment, which will be equal to 100% of base salary, subject to certain conditions.
Except as disclosed in this Current Report on Form 8-K, the terms and conditions of the Employment Agreement remain unchanged.
The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the complete text of the Employment Agreement, which is incorporated by reference herein.
Management Compensation and Grant of Restricted Stock Units
On October 27, 2022, in consideration for Mr. Baratz’s prior service to the Company and to incentivize future performance, Mr. Baratz was granted a one-time equity award of 2,500,000 restricted stock units (“RSUs”) under the D-Wave Quantum Inc. 2022 Equity Incentive Plan (the “2022 Incentive Plan”). Each RSU represents the right to receive one share of the Company’s common stock, par value $0.0001 per share (“Common Stock”). 1,500,000 of the RSUs will vest 50% on the first anniversary of the grant date, and 25% on each of the second and third anniversaries of the grant date, subject to Mr. Baratz’s continued service to the Company. 1,000,000 of the RSUs will vest 50% on each the first and second anniversaries of the grant date, subject to Mr. Baratz’s continued service to the Company.
In addition, in consideration for John M. Markovich’s service as Chief Financial Officer and to incentivize and retain Mr. Markovich, Mr. Markovich’s base salary was increased to $400,000 per annum and Mr. Markovich was granted a one-time equity award of 875,000 RSUs under the 2022 Incentive Plan. Each RSU represents the right to receive one share of Common Stock that will vest 50% on the first anniversary of the grant date and 25% on each of the second and third anniversaries of the grant date, subject to Mr. Markovich’s continued service to the Company.
