Dino DiPerna
CIENAAbout Dino DiPerna
Senior Vice President, Global Research & Development at Ciena (appointed effective October 27, 2023), leading optical networking, routing and switching, and network control and planning R&D; joined Ciena in 2010 via Nortel’s optical business acquisition; bachelor’s in Electrical Engineering from McGill University; age 63 as of the latest 10-K filing . Under his leadership, Ciena advanced WaveLogic 6, expanded WaveRouter solutions, and positioned interconnects for data center opportunities . Company performance context during his recent tenure includes FY2024 revenue of $4,014,955k, net income of $83,956k, and TSR value of 144.53 (vs peer group 109.00) per pay-versus-performance disclosures .
| Performance Context | FY 2021 | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|---|
| Ciena Revenue ($000s) | 3,620,684 | 3,632,661 | 4,386,549 | 4,014,955 |
| Net Income ($000s) | 500,196 | 152,902 | 254,827 | 83,956 |
| Ciena TSR (Value of $100) | 114.00 | 88.93 | 88.69 | 144.53 |
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Ciena | SVP, Global Research & Development | Oct 2023–present | Consolidated >3,500 R&D professionals across optical, routing/switching, and network control; drove WaveLogic 6 and WaveRouter advances . |
| Ciena | VP, Converged Packet Optical R&D | Aug 2013–Oct 2023 | Led development of coherent optical portfolio (including WaveLogic technology) . |
| Ciena | VP, Optical Networks R&D | Mar 2010–Jul 2013 | Led optical R&D post-Nortel acquisition . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Nortel | Senior engineering roles (optical) | Pre-2010 | >20 years in senior engineering; foundational expertise in coherent optics brought to Ciena via acquisition . |
Fixed Compensation
| Metric | FY 2023 | FY 2024 | Notes |
|---|---|---|---|
| Annual Base Salary (local currency) | CAD 545,000 | CAD 648,000 | +18.9% on promotion to executive officer . |
| Salary Paid (USD, per SCT) | — | $473,330 | USD figure reflects CAD salary converted at FY-end rate . |
| Target Annual Cash Incentive (% of base) | 60% | 80% | Raised with promotion . |
| Target Total Cash (local currency) | CAD 872,000 | CAD 1,166,400 | +33.8% YoY . |
Performance Compensation
Annual Cash Incentive Plan (FY2024 design and outcome)
- Weighting: Revenue 40%, Adjusted Operating Income 30%, Corporate Objectives 30% .
- Results: Revenue $4,015MM vs $4,600MM (69.5% payout on that sleeve); Adjusted Operating Income $465.8MM vs $734MM (0%); Corporate Objectives 5 of 6 achieved (125%) → Total payout 65% of target .
| Metric (Weight) | Target | Actual | Payout % |
|---|---|---|---|
| Revenue (40%) | $4,600MM | $4,015MM | 69.5% |
| Adjusted Operating Income (30%) | $734MM | $465.8MM | 0% |
| Corporate Objectives (30%) | 4 objectives | 5 achieved | 125% |
| Aggregate Payout | — | — | 65% of target |
| Payout to DiPerna | Currency | Amount |
|---|---|---|
| Non-Equity Incentive Plan Compensation (SCT) | USD | $241,488 |
| Cash Incentive Bonus (Attainment table) | CAD | CAD $336,960 |
Equity Awards (granted December 12, 2023)
| Award Type | Grant Date | Shares/Units | Grant Date Fair Value (USD) | Key Terms |
|---|---|---|---|---|
| RSU | 12/12/2023 | 21,799 | $950,000 | Vests 1/16 quarterly on Mar/Jun/Sep/Dec 20 through Dec 20, 2027 . |
| PSU (FY2024 performance) | 12/12/2023 | Target 13,079; Thresh 3,270; Max 26,158 | $569,983 | Metrics: Aggregate Sales Orders (50%) and Adjusted EPS (50%); 40% earned; vests 50% on Dec 20, 2024 and 50% on Dec 20, 2025 . |
| MSU (FY2024–2026) | 12/12/2023 | Target 8,720; Max 17,440 | $534,013 | Earned based on Relative TSR vs index; 0–200% payout; vests Dec 2026 if earned . |
PSU FY2024 goal-to-actuals:
- Sales Orders: Threshold $3,214MM; Target $4,017MM; Actual $3,595MM → 80% earned for this goal .
- Adjusted EPS: Threshold $2.07; Target $2.73; Actual $1.82 → 0% for this goal .
- Aggregate PSUs earned: 40% of target; for DiPerna, 5,231 PSUs earned (half vested Dec 2024; remainder Dec 2025) .
MSU framework:
- Relative TSR performance: Equal to index = 100% earned; ≥ +50 percentage points = 200% earned; negative TSR caps below 100%; vests after 3-year period (Dec 2026 for FY2024–2026 grant) .
- FY2022–2024 MSUs (granted Dec 2021) paid at 110% due to TSR outperformance of +4.79 percentage points .
Equity Ownership & Alignment
Beneficial Ownership (as of January 27, 2025)
| Holder | Shares Owned | Right to Acquire (within 60 days) | Total Beneficial | % Outstanding |
|---|---|---|---|---|
| Dino DiPerna | 4,180 | 3,963 | 8,143 | <1% |
- No outstanding stock options for executives/directors at Ciena .
- Stock ownership guidelines: executive officers must hold stock equal to 2x base salary; must hold 50% of net shares from awards until guideline met; five years to reach compliance .
- Anti-hedging and anti-pledging: policy prohibits hedging and pledging by all employees and directors .
Outstanding and Unvested Equity (FY2024 year-end)
| Grant Type | Grant Date | Unvested/Outstanding (#) | Market Value ($) | Vesting/Notes |
|---|---|---|---|---|
| PSU (earned 40%) | 12/12/2023 | 5,231 | $334,627 | Vests 50% Dec 20, 2024; 50% Dec 20, 2025 . |
| RSU | 12/12/2023 | 17,713 | $1,133,101 | Vests 1/16 quarterly to Dec 20, 2027 . |
| MSU (performance-based) | 12/12/2023 | 8,720 | $557,818 | Earned/vest timing per TSR metric; vest Dec 2026 if earned . |
| RSU | 10/27/2023 | 4,572 | $292,471 | Time-based vesting per award terms . |
| RSU | 12/13/2022 | 7,452 | $476,704 | Vests 1/16 quarterly to Dec 20, 2026 . |
| RSU | 12/14/2021 | 2,975 | $190,311 | Time-based vesting . |
| RSU | 12/16/2020 | 688 | $44,011 | Time-based vesting . |
Trading Arrangements and Selling Pressure
| 10b5-1 Plan | Adoption Date | Nature | Duration | Scope |
|---|---|---|---|---|
| Dino DiPerna | Sep 11, 2024 | Rule 10b5-1 sales plan | Until Oct 31, 2025 (or completion) | Up to 1,788 shares plus 25% of net after-tax shares from vesting of an aggregate 17,207 RSUs on specified dates (Sep 20, 2024; Dec 20, 2024; Mar 20, 2025; Jun 20, 2025; Sep 20, 2025) and 25% of net after-tax shares from up to 2,615 PSUs vesting Dec 20, 2024; actual net shares vary with stock price/tax . |
- Section 16(a) compliance: two late Form 4s for DiPerna (one for a single transaction; another for five tax-withholding transactions on one date) .
Employment Terms
Severance and Change-in-Control (CIC)
- CIC Agreements: double-trigger; effective through November 2025 (subject to automatic extension if a CIC is pending/occurs), no tax gross-up (“best choice” cutback) .
- Covered termination window: within 90 days prior to or 12 months post-CIC (CEO 18 months) .
- Severance on covered termination: 1.5x base salary + target annual bonus (CEO 2.5x), benefits continuation, and immediate vesting of unvested equity (with performance awards converted to time-based at target on CIC) .
- Non-compete and non-solicit obligations: 12 months post-termination (CEO 18 months) as condition of CIC severance; clawback of severance on breach .
| Potential Payments (Covered Termination post-CIC) | Salary+Bonus | Benefits | Equity Acceleration | Total |
|---|---|---|---|---|
| Dino DiPerna | $1,253,879 | $9,962 | $3,531,080 | $4,794,921 |
- If acquirer does not assume/replace awards, illustrative value of full acceleration for DiPerna: $3,531,080 at $63.97/share (target for unearned PSUs/MSUs) .
Involuntary Separation (non-CIC)
- U.S. Executive Severance Benefit Plan: for SVPs, severance equals 1x base salary + target annual bonus, 12 months benefits continuation, and outplacement; 12-month non-compete and non-solicit; “best choice” excise provision; subject to clawback and release .
| Payments on Involuntary Separation (Other than Cause) | Salary + Target Bonus | Benefits + Outplacement | Total |
|---|---|---|---|
| Dino DiPerna | $835,919 | $8,103 | $844,022 |
Other Policies/Provisions
- Clawback: NYSE/Exchange Act Section 10D-compliant policy for accounting restatements; severance recoupment for breaches under plans .
- Qualifying Retirement: at age ≥60 with ≥10 years’ service and 12 months’ notice, RSUs continue to vest, PSUs/MSUs pro-rate and continue vesting on schedule; DiPerna met age/service eligibility as of Nov 2, 2024 (illustrative value $3,017,849 at $63.97/share) .
- Death/Disability: RSUs accelerate 12 months; for PSUs/MSUs (from Dec 2023 grants), pro-rata vesting at target for unearned awards; DiPerna value $1,879,199 at FY2024 close price .
- Perquisites: financial planning/tax prep reimbursement (up to $10,000/year) for executive officers; Canadian defined contribution pension contribution for DiPerna: $9,353 (USD) in FY2024 .
- Say-on-Pay: ~90% approval in prior year .
Expertise & Qualifications
- Technical: deep optical networking and coherent modem R&D leadership (WaveLogic) .
- Education: B.Eng., Electrical Engineering, McGill University .
- Industry experience: >20 years at Nortel in senior engineering plus >14 years at Ciena across optical and packet-optical R&D leadership .
Performance Compensation Details (Design Clarity)
| Incentive Type | Metric | Weight | Target | Actual | Payout |
|---|---|---|---|---|---|
| Annual Cash (FY2024) | Revenue | 40% | $4,600MM | $4,015MM | 69.5% |
| Annual Cash (FY2024) | Adjusted Operating Income | 30% | $734MM | $465.8MM | 0% |
| Annual Cash (FY2024) | Corporate Objectives | 30% | 4 objectives | 5 achieved | 125% |
| PSU (FY2024) | Aggregate Sales Orders | 50% | $4,017MM | $3,595MM | 80% (for this half) |
| PSU (FY2024) | Adjusted EPS | 50% | $2.73 | $1.82 | 0% (for this half) |
| MSU (FY2022–2024) | Relative TSR vs Index | 100% | Equal = 100%; ≥+50pts=200% | +4.79pts | 110% |
Compensation Structure Analysis
- Shift and mix: For NEOs other than the CEO, approximately 50% of target equity value is performance-based (PSUs/MSUs), maintaining at-risk pay; DiPerna’s target bonus percentage increased with his promotion, raising variable cash exposure .
- Goal rigor/alignment: Cash plan paid 65% of target due to revenue underachievement and AOI below threshold; PSUs earned 40% with sales orders under target and EPS below threshold, indicating downward sensitivity when growth/earnings miss; MSUs awarded in 2021 paid at 110% on relative TSR outperformance, aligning with shareholder returns .
- Equity practice: Mix of time-based RSUs for retention and performance-based PSUs/MSUs for alignment; vesting cadences quarterly for RSUs and back-ended for MSUs indicate measured retention plus long-horizon performance .
- No option repricing and no excise tax gross-ups; “best choice” provision avoids shareholder-unfriendly gross-ups .
Investment Implications
- Pay-for-performance alignment appears intact: FY2024 cash and PSU payouts reset materially lower on underperformance (65% and 40%), while long-term MSUs reward relative TSR outperformance (110% for 2021 grant) — reducing windfalls and aligning incentives with value creation .
- Insider selling pressure: Active 10b5-1 plan through Oct 2025 includes sales of fixed shares plus a proportion of net after-tax vesting shares; expect periodic supply around quarterly vest dates, though magnitudes are modest versus float .
- Retention risk: Eligible for “Qualifying Retirement” continued vesting regime (age/service met) which can de-risk departure economics; however, continued vesting (vs acceleration) keeps alignment post-retirement; CIC severance at 1.5x cash is moderate; non-compete/non-solicit covenants provide some retention friction .
- Alignment and governance: Low personal ownership (<1%) but subject to 2x salary ownership guideline and 50% hold requirement; anti-hedging/pledging policy mitigates misalignment risk; no tax gross-ups and strong clawback framework reduce governance red flags; minor late Section 16 filings noted .
- Execution track record: Leadership over WaveLogic 6 and WaveRouter platform development underscores core technical advantage in coherent optics and IP/optical convergence — a key driver as data center and AI traffic expand .