Slide 1: Supplemental Disclosure on Advisory Say on Pay Vote
Supplemental Disclosure on Advisory Say on Pay Vote © 2018 Ambarella Inc. CONFIDENTIAL May 2018
Slide 2: Contents
Contents Business Overview Page 3 Proxy Advisor Feedback Page 4 Compensation Highlights Based on Proxy Advisor Feedback Page 5-6 Appendix Pages 8-13 Executive Compensation Structure Page 8 Annual Incentive Page 9 Performance-Based RSUs Page 10 CEO Compensation Page 11 Compensation Governance Page 12
Slide 3: Business Overview
Business Overview Our long-term success requires us to develop new technologies to address our current markets as well as open up new opportunities in significantly larger markets Our current video markets are rapidly evolving from simply capturing high quality video to simultaneously capturing and
Slide 4: Proxy Advisor Feedback
Proxy Advisor Feedback ISS Commentary Recommended vote ‘against’ Say on Pay Annual Incentive Based on objective measures Below target payout aligns with performance CEO’s opportunity decreased Operating income target below prior year Equity 50% of equity has performance conditions PSUs based on annu
Slide 5: Compensation Highlights Based on Proxy Advisor Feedback
Compensation Highlights Based on Proxy Advisor Feedback Highlight Additional Context CEO target pay has decreased, not increased Actual CEO equity grant levels have decreased by approximately 40% since FY2016 The proxy Summary Compensation Table shows an increase in CEO equity grant levels for FY201
Slide 6: Compensation Highlights Based on Proxy Advisor Feedback (cont'd)
Compensation Highlights Based on Proxy Advisor Feedback (cont’d) Highlight Additional Context FY2019 RSU grants vest over 3 years FY2018 RSUs vest over a two-year period to help manage the transition to longer “cliff” vesting in the PRSUs Company is returning to three-year vesting period in FY2019 T
Slide 7: Appendix
Appendix © 2018 Ambarella Inc. CONFIDENTIAL
Slide 8: Executive Compensation Structure
Executive Compensation Structure Salary Annual Incentive Equity Cash Cash PRSU CEO 50% Others 30% RSU CEO 50% Others 70% No performance conditions; attracts and retains executives Operational Performance 50% Revenue 50% Operating Income Strategic objectives with relative TSR modifier Time-vested Ele
Slide 9: Executive bonus pool paid out at 48% of target in FY2018
Executive bonus pool paid out at 48% of target in FY2018 The revenue target, which was higher than actual performance in the prior year, required growth in key IP security camera and automotive OEM markets to achieve The operating income target, which was lower than actual performance in the prior y
Slide 10: Performance-Based RSUs
Ambarella’s Historical Monthly Average Stock Price Since IPO Performance-Based RSUs Share Price ($) FY2018 PRSUs directly tied to achieving three objectively-measured strategic priorities The annual strategic goals are targeted at aggressive product execution milestones related to our computer visio
Slide 11: CEO Compensation
Ceo Compensation ~40% decrease in target equity Pay mix is ≈90% weighted towards equity Annual equity has decreased by approximately 40% since FY2016, and vesting is now 50% based on performance In 2017, the annual grant timing changed from the end of the fiscal year to the beginning Resulted in an
Slide 12: Compensation Governance
Compensation Governance Stock ownership guidelines Clawback policy for performance-based compensation Double-trigger change in control provisions Retain an independent compensation consultant Anti-hedging policy Annual “say-on-pay” advisory votes Pay and performance linked with corporate performance
Slide 13: Ambarella's Board of Directors
Ambarella’s Board of Directors have deep executive and Board leadership experience from tenures at diverse technology companies of various sizes Overview of Directors Director Relevant Experience Fermi Wang – 2004 (Chairman and CEO) Has served as Chairman since co-founding Ambarella in 2004 Previous
Slide 14: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements that are not historical facts, including statements relating to our intention to accelerate development and deployment of our technologies, including computer vision functionality, our ability to generate design wins fr