Kimon Michaels
PDF SOLUTIONSAbout Kimon Michaels
Kimon W. Michaels, Ph.D., is Executive Vice President, Products and Solutions, and a non‑independent director at PDF Solutions. A co‑founder, he has served in multiple senior roles since March 1993, including CFO (1995–1998); he has been EVP, Products and Solutions since February 2019 and a director since 1995; age 59; Class II director with term ending after the 2026 fiscal year . Company performance during the latest year included GAAP revenue growth of $13.6 million to $179.5 million and positive GAAP net income of $4.1 million; the proxy’s pay‑versus‑performance panel shows a $100 initial investment grew to $160 vs $151 for the peer group in 2024 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| PDF Solutions | Executive Vice President, Products & Solutions | Feb 2019–present | Leads product and solutions strategy across semiconductor analytics; co‑founder perspective aligns product roadmaps with customers . |
| PDF Solutions | Vice President, Products & Solutions | Jul 2010–Jan 2019 | Drove commercialization and scaling of analytics solutions . |
| PDF Solutions | Vice President, Design for Manufacturability | Jun 2007–Jun 2010 | Advanced DFM capabilities supporting yield optimization . |
| PDF Solutions | VP, Field Operations for Manufacturing Process Solutions | Jan 2006–May 2007 | Led customer field operations for process solutions . |
| PDF Solutions | Various Vice Presidential roles | Mar 1993–Dec 2005 | Built core operations and growth foundations as co‑founder . |
| PDF Solutions | Chief Financial Officer | Nov 1995–Jul 1998 | Early finance leadership; capital stewardship during scaling . |
External Roles
No external public company directorships or roles disclosed for Michaels in the latest proxy .
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 372,500 | 395,000 | 400,000 |
| Target Bonus (% of Base) | 60% (effective through 2024) | 60% | 60% |
| Discretionary Bonus ($) | 190,000 | 77,720 | 73,510 |
| PPCP Bonus ($) | — | 80,376 | 73,509 |
| Total Cash Compensation ($) | 562,500 | 553,096 | 547,019 |
Notes:
- “PPCP” is the pay‑for‑performance component of the annual cash incentive program. Half of the annual incentive is driven by corporate metrics; the other half is discretionary based on strategic contributions .
Performance Compensation
| Metric | Weighting | Target | Actual (2024) | Payout to Michaels | Vesting/Timing |
|---|---|---|---|---|---|
| PPCP corporate metrics | 50% of annual incentive | Positive YoY revenue growth; positive adjusted EBITDA; performance rating above “DM” | Revenue $179.5M (+$13.6M YoY); Adjusted EBITDA $38.8M; Corporate factor 61.3% | $73,509 (PPCP component) | Paid after year-end committee verification . |
| Discretionary component | 50% of annual incentive | Strategic contributions | Leadership in strategic initiatives and partner relationships | $73,510 (Discretionary component) | Paid after committee evaluation . |
Additional details:
- The CHCM Committee evaluated Michaels’ strategic impact; corporate bonus pool funding factor was 61.3% for 2024 .
- No RSU/PSU grants to Michaels in 2024, consistent with founder alignment and conserving the equity pool for other employees .
Equity Ownership & Alignment
| Ownership Element | Detail |
|---|---|
| Beneficial Ownership | 1,547,142 shares; 4.02% of outstanding; includes 26,984 shares held by spouse as separate property; shared voting/dispositive power over these holdings . |
| Vested vs. Unvested Equity | Michaels held no unvested RSUs or options as of 12/31/2024 . |
| Options | None outstanding; no recent option grants . |
| Pledging/Hedging | Insider Trading & Disclosure Policy prohibits short sales and certain hedging; recommends not pledging/margining company stock . |
| Ownership Guidelines | Section 16 officers (incl. Michaels) must hold ≥2x salary; all current executives meet guidelines or have time remaining to do so . |
| Recent Insider Activity | On Jan 1, 2025, 870 shares were withheld to cover taxes upon RSU vesting in an indirect spouse account (non‑market disposal; code “F” on Form 4) . |
Employment Terms
| Provision | Michaels |
|---|---|
| Employment start date | March 1993 (various VP roles from 1993; CFO 1995–1998) . |
| Current role tenure | EVP, Products & Solutions since Feb 2019 . |
| Severance | No executive severance agreement; Company notes no severance arrangements for NEOs except CFO Raza . |
| Change-in-Control (CIC) | Under the stock plan, awards (if any) accelerate if not assumed/substituted; if assumed, unvested awards fully vest upon involuntary termination without cause within 24 months post‑CIC (double trigger). No single‑trigger acceleration for assumed awards . |
| Clawback | Compensation Recovery Policy adopted Feb 2023; updated Nov 2023 and Apr 2024 to cover all equity (time‑ and performance‑based) . |
| Non‑compete / non‑solicit | Not disclosed in proxy. |
Board Governance
- Role: Non‑independent director, Class II; committees: none .
- Independence structure: CEO and Chair roles are separated; Lead Independent Director with robust charter; six of eight directors are independent .
- Board/Committee meetings: 6 Board and 15 committee meetings in 2024; average attendance 98%; all directors attended ≥75% and the 2024 annual meeting .
- Executive sessions: Independent directors meet regularly, not less than twice per year .
- Director compensation: Employee directors (incl. Michaels) are not compensated for Board service; non‑employee director retainers and RSUs apply only to independent directors .
Director Compensation (for reference)
| Element | Amount |
|---|---|
| Non‑employee annual cash retainer | $40,000; +$20,000 for Lead Independent Director; committee retainers vary by chair/member . |
| Non‑employee annual equity | RSUs valued at $150,000; monthly vesting over a year . |
Employee directors (incl. Michaels) do not receive these director fees or equity .
Company Performance Context (for Pay‑for‑Performance analysis)
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Revenues ($) | 148,549,000 | 165,835,000 | 179,465,000 |
| EBITDA ($) | 4,704,000* | 6,120,000* | 5,459,000* |
*Values retrieved from S&P Global.
Additional proxy performance indicators:
- 2024 adjusted EBITDA (bonus definition): $38.8M; corporate factor 61.3% .
- Pay‑vs‑Performance panel: $100 initial investment value $160 (Company) vs $151 (peer) in 2024; GAAP net income $4.1M; GAAP revenue growth $13.6M .
Compensation Structure Analysis
- Mix trends: As a founder with significant ownership, Michaels received no equity awards in 2023–2024, conserving pool for broader employee incentives; cash incentive maintained at 50% PPCP and 50% discretionary .
- Metrics rigor: PPCP tied to GAAP revenue growth and adjusted EBITDA; corporate factor scaling aligns pool with performance and verified outcomes .
- Governance safeguards: No option repricing; no tax gross‑ups; no dividends on unvested awards; clawback expanded to all equity; double‑trigger CIC vesting .
Risk Indicators & Red Flags
- Related party transactions: None in 2024 under Item 404(a) .
- Hedging/pledging: Short sales/hedging prohibited; pledging/margin discouraged by policy .
- Equity plan dilution: 3‑year average net burn rate 2.25%; overhang 10.66% (FY 2024) .
- Say‑on‑Pay: Strong shareholder support; recent proxy notes >99% of shares were cast (for or against) the NEO compensation proposal, indicating robust engagement and support levels .
Compensation Peer Group
- 2024 peer set (selected by Compensia in 2023) included 18 adjacent tech/software/semiconductor analytics names (e.g., Ambarella, Model N, Onto Innovation); CHCM does not target a fixed percentile, retaining discretion to account for performance and role scope .
Equity Vesting & Insider Selling Pressure
- Michaels had no unvested awards as of 12/31/2024; therefore minimal direct vesting‑related selling pressure is expected .
- A January 2025 Form 4 shows a non‑market tax withholding of 870 shares in an indirect spouse account upon RSU vesting (code F), indicating routine tax settlement rather than discretionary selling .
Investment Implications
- Strong alignment: Founder ownership (4.02%) and no recent equity grants reduce overhang and align Michaels’ incentives with long‑term value creation; compliance with ownership guidelines further supports alignment .
- Low retention risk via cash incentives: With annual cash incentives balanced between performance metrics (revenue, adjusted EBITDA) and strategic contributions, Michaels’ pay remains at‑risk and tied to execution, while the lack of severance protection implies standard market retention levers (role scope, performance upside) .
- Governance mitigants: Robust clawback, no repricing/gross‑ups, double‑trigger CIC vesting, and independent Board leadership lower compensation/governance risk for investors .
- Performance orientation: 2024 GAAP revenue growth (+$13.6M) and positive GAAP net income, alongside strong TSR vs the peer reference, support the pay‑for‑performance narrative embedded in Michaels’ incentive design .