K. Charles Janac
About K. Charles Janac
K. Charles Janac, age 67, is Chairman, President and Chief Executive Officer of Arteris, Inc. (ticker: AIP), serving as CEO since 2005 and Chairman since 2007, with 40 years of technology operating and EDA industry experience and an MBA from Stanford GSB (BS/MS in Chemistry from Tufts) . Under his leadership, Arteris reported 2024 revenue of $57.7M vs. $53.7M in 2023, reflecting continued growth since the 2021 IPO . He holds significant skin-in-the-game through a 24.3% beneficial stake as of April 10, 2025, aligning incentives with shareholders .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Arteris, Inc. | Chairman; President & CEO | Chairman since 2007; CEO since 2005 | Scaled NoC IP leadership; guided IPO; sustained revenue growth |
| Nanomix, Inc. | President & CEO | 2001–2003 | Built early-stage nanotechnology startup |
| Infinity Capital | Entrepreneur-in-Residence | 1999–2001 | Evaluated IT investments for VC firm |
| Smart Machines | Founder; President & CEO | 1993–1999 | Built semiconductor automation firm; sold to Brooks Automation in 1999 |
| Cadence Design Systems | Marketing & Sales leadership | 1983–1992 | Helped scale into top-tier technical software firm |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Transchip (affiliated company) | Director | Since Aug 2022 | Arteris retains minority non‑controlling interest; Janac serves on board |
Fixed Compensation
| Metric | 2023 | 2024 |
|---|---|---|
| Base Salary ($) | 404,000 | 404,000 |
| Target Bonus % of Salary | 92% | 92% |
| Target Bonus ($) | 371,680 (computed) | 371,680 (computed) |
| Bonus Achievement (% of Target) | 75% | 94% |
| Actual Bonus Paid ($) | 278,760 | 349,379 |
| RSU Grant (#) | 117,500 (Mar 2023 grant) | 117,500 (Feb 2024 grant) |
| RSU Grant Fair Value ($) | 641,550 | 723,800 |
| Other Compensation ($) | 13,200 (401k match) | 6,060 (401k match) |
Notes: 2024 base salary flat YoY; higher cash bonus payout on improved achievement; equity compensation via time-based RSUs (no options granted in 2024) .
Performance Compensation
- Annual cash bonus framework: target set as % of salary (CEO 92%); payouts based on corporate financial/operational objectives and individual goals; 2024 payout at 94% of target; 2023 at 75% of target (specific metrics/weightings not disclosed) .
- Equity awards: time-based RSUs vesting quarterly; no performance share units disclosed; no stock options granted to NEOs in 2024 (options are not a component of the program) .
| Incentive Type | Metric(s) | Weighting | Target | Actual | Payout/Term |
|---|---|---|---|---|---|
| Annual Cash Bonus (2024) | Corporate and individual goals (undisclosed) | N/A | 92% of salary | 94% of target | Paid Feb 2025 |
| RSUs (2024 grant) | Time-based vest | N/A | 117,500 RSUs | N/A | 1/16 quarterly from Apr 1, 2024 |
| RSUs (2023 grant) | Time-based vest | N/A | 117,500 RSUs | N/A | 1/16 quarterly from Apr 1, 2023 |
Equity Ownership & Alignment
- Beneficial ownership: Janac beneficially owns 10,072,859 shares (24.3%) including 9,907,691 shares held by Bayview Legacy, LLC (manager: Janac), 102,666 shares direct, 56,252 via trust, and 6,250 options exercisable within 60 days; shares outstanding 41,463,290 as of Apr 10, 2025 .
- Pledging/hedging: Company policy prohibits hedging, pledging/margin of company stock—reducing misalignment risk .
- Executive ownership guidelines: Proxy discloses non-employee director ownership guidelines adopted Feb 2025; no executive ownership guideline disclosed .
| Ownership Snapshot (as of Apr 10, 2025) | Shares | % of Outstanding |
|---|---|---|
| Bayview Legacy, LLC (managed by Janac) | 9,907,691 | 23.9% |
| K. Charles Janac total beneficial | 10,072,859 (incl. above) | 24.3% |
| Shares Outstanding (context) | 41,463,290 | — |
- Vested vs. unvested equity (12/31/2024): Janac held unvested RSUs of 13,213 (2021 grant), 66,094 (2023 grant), 95,469 (2024 grant); RSU vesting schedules: 2021 award: 12.5% on May 1, 2022 then quarterly; 2023 and 2024 awards: 1/16 quarterly from Apr 1 of grant year . Options: 6,250 exercisable within 60 days as of Apr 10, 2025 .
| Unvested Equity Detail (12/31/2024) | Unvested Shares | Vesting Schedule | Market Value Ref ($10.19) |
|---|---|---|---|
| RSUs (grant 11/11/2021) | 13,213 | 12.5% on May 1, 2022; then quarterly over remaining 14 quarters | 134,640 |
| RSUs (grant 3/7/2023) | 66,094 | 1/16 quarterly from Apr 1, 2023 | 673,498 |
| RSUs (grant 2/1/2024) | 95,469 | 1/16 quarterly from Apr 1, 2024 | 972,829 |
- Forward vesting cadence (supply overhang): 2023 grant has 9 quarterly vest tranches remaining (~7,344 shares/quarter), and 2024 grant has 13 quarterly tranches remaining (~7,344 shares/quarter), subject to continued service—potentially ~16 quarterly RSU settlements totaling ~202k shares through 2028 (derived from grant sizes and schedules) .
Employment Terms
- Severance: If terminated without cause or resigns for good reason outside a change in control (CIC) window: 12 months salary and 12 months healthcare for CEO (lesser benefits for other NEOs) .
- CIC economics (double trigger within −3 months to +12 months of CIC): 18 months salary for CEO; pro‑rated target bonus; 18 months healthcare; full accelerated vesting of time‑based equity (performance awards governed by award terms) .
- Agreement term: severance/CIC agreements renewed July 2024 for a three‑year term .
- Clawback: Policy effective Oct 2, 2023 aligned with SEC/Nasdaq rules covers incentive comp tied to financial reporting measures .
- Insider trading policy: preclearance for certain insiders; blackout windows; hedging/pledging prohibited .
Board Governance
- Board service: Director since 2005; Chairman since 2007; dual role as CEO + Chairman .
- Committee roles: Janac is not listed as a member of Audit, Compensation, or Nominating & Corporate Governance Committees; those committees are fully independent .
- Independence and structure: Six of seven directors are independent under Nasdaq rules (i.e., all except the CEO/Chairman); Board employs a Lead Independent Director (Wayne C. Cantwell) to preside over executive sessions and act as liaison .
- Attendance: Board met 7 times in 2024; all directors attended at least 75% of their meetings; Audit (4), Compensation (5), Nominating (4) meetings in 2024 .
Director Compensation (context for dual role)
- Employees receive no additional pay for director service; non‑employee directors are paid retainers and RSUs; all director equity fully vests upon change in control .
- Stock ownership guidelines apply to non‑employee directors (5x cash retainer; 5‑year compliance window; measured at acquisition cost) from Feb 2025—not to executives .
Performance & Track Record
| Year | Revenue ($M) |
|---|---|
| 2023 | 53.7 |
| 2024 | 57.7 |
Additional operating highlights referenced by management include >3B SoCs shipped by customers incorporating Arteris IP, and growth in SoC integration automation products (CEO letters) .
Compensation Structure Analysis
- Cash vs. equity mix: Base salary flat YoY; RSU grant value increased in 2024 ($723.8k vs. $641.6k), keeping a high portion of at‑risk, equity-based pay .
- Options to RSUs shift: No stock options granted to NEOs in 2024; the program relies on time‑based RSUs, lowering incentive risk vs. performance‑based equity but aligning with retention .
- Bonus rigor: Payout improved to 94% of target in 2024 (from 75% in 2023), with metrics undisclosed; absence of disclosed goal calibration limits external assessment of rigor .
- Clawback/controls: SEC‑compliant clawback and strict insider trading/hedging/pledging prohibitions support alignment and risk management .
Related Party and Other Governance Items
- Bayview Legacy, LLC: Largest holder (23.9%); Janac is manager and shares dispositive power—aligns incentives but concentrates control .
- Section 16 compliance: Company noted a Form 4 correction on Jan 8, 2025 for Janac correcting inadvertent overstatements; otherwise in compliance for 2024 .
Risk Indicators & Red Flags
- Governance: Combined CEO/Chair structure—mitigated by Lead Independent Director and a majority‑independent board and committees .
- Concentrated ownership: Janac’s ~24% stake and Bayview’s holdings concentrate voting power—can be positive for alignment but raises entrenchment considerations .
- Disclosure gaps: No detailed disclosure of bonus metric targets/weightings or executive stock ownership guidelines, limiting external pay‑for‑performance evaluation .
Compensation Peer Group and Say‑on‑Pay
- Peer group/target percentile: Not disclosed in EGC‑scaled proxy .
- Say‑on‑Pay: Not required as an Emerging Growth Company; no advisory vote held .
Expertise & Qualifications
- Education: BS/MS (Organic Chemistry) Tufts; MBA Stanford GSB .
- Domain expertise: EDA/IP business building (Cadence; Arteris), semiconductor automation (Smart Machines), venture and startup leadership (Nanomix; Infinity Capital) .
- Board experience: Director of Transchip; long‑tenured Arteris board leadership .
Investment Implications
- Alignment: Very high insider alignment via 24.3% beneficial stake and no pledging/hedging permitted—reducing agency risk; however, concentrated control can diminish minority shareholder influence .
- Supply overhang: Predictable RSU settlement cadence (~7.3k shares per quarter for each of 2023 and 2024 grants; ~16 tranches remaining combined) may create modest, periodic insider selling pressure upon vesting and tax withholding .
- Retention/continuity: Renewed 3‑year severance/CIC agreements with double‑trigger vesting accelerate equity only upon qualifying separation around a CIC, balancing retention with change‑of‑control alignment .
- Performance linkage: Cash bonus improved in 2024 (94% of target), but lack of disclosed scorecards limits external assessment of pay‑for‑performance tightness; equity is time‑based, emphasizing retention over explicit performance stretch .
- Governance checks: Lead Independent Director and fully independent key committees mitigate combined Chair/CEO risk; EGC status means no Say‑on‑Pay yet, modestly reducing direct shareholder feedback loops on compensation .