Stephen Sonne
About Stephen Sonne
Stephen Sonne is Chief Legal Officer and Corporate Secretary of Palladyne AI Corp. (PDYN), serving in the role since September 2022 after joining as SVP & General Counsel in February 2022; he also began overseeing the company’s HR function in February 2024 . He holds a BA in Political Science and Spanish (BYU), an MBA (Fuqua), and a JD (Duke Law), and previously served as SVP, Associate General Counsel and Corporate Secretary at Booking Holdings (2013–2021) and as a Partner at O’Melveny & Myers LLP . As of March 31, 2025, Sonne is age 56 . PDYN’s FY2024 revenue grew 27% to $7.8 million with a 73% reduction in operating expenses versus FY2023, improving loss trajectory during Sonne’s tenure .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Palladyne AI Corp. | SVP & General Counsel; Chief Legal Officer & Secretary; Oversight of HR | Feb 2022–Sep 2022; Sep 2022–present; HR from Feb 2024 | Led legal function (public reporting, governance), expanded to HR oversight |
| Booking Holdings (NASDAQ: BKNG) | SVP, Associate General Counsel; Corporate Secretary | Jan 2013–Mar 2021; Corporate Secretary Apr 2018–Mar 2021 | Oversaw public reporting, securities offerings, M&A, corporate governance |
| O’Melveny & Myers LLP | Partner | Pre-2013 | Senior legal practice leadership (prior to Booking Holdings) |
External Roles
| Organization | Role | Years |
|---|---|---|
| None disclosed | — | — |
Fixed Compensation
Employment Agreement Terms (current framework; at-will):
| Item | Value |
|---|---|
| Initial base salary | $275,000 per year |
| Target annual bonus | 50% of base salary |
| Employment term | At-will; no specific term |
Reported Compensation (Summary Compensation Table):
| Metric | FY 2023 | FY 2024 |
|---|---|---|
| Salary ($) | $288,970 | $370,000 |
| Bonus ($) | $102,600 (discretionary) | $240,500 (retention $185,000; discretionary $55,500) |
| Stock Awards ($) | $100,000 | $59,060 |
| Option Awards ($) | $100,000 | $14,818 (incremental value from April 2024 option repricing) |
| All Other Compensation ($) | — | — |
| Total ($) | $591,570 | $684,378 |
Performance Compensation
Outstanding Equity Awards at FY2024 Year-End (as of Dec 31, 2024):
| Award Type | Grant Date | Quantity/Status | Exercise Price | Expiration | Market/Notes |
|---|---|---|---|---|---|
| Options | 4/1/2022 | 19,757 (exercisable) | $1.59 (repriced 4/17/2024) | 2/7/2032 | Vesting restarted: 25% on 3/29/2025; then 1/12 quarterly |
| RSUs | 4/1/2022 | 2,565 unvested; market value $31,473 | — | — | Time-based award |
| Options | 3/29/2023 | 7,928 (exercisable); 10,194 (unexercisable) | $2.82 | 3/29/2033 | Standard vesting |
| RSUs | 3/29/2023 | 20,084 unvested; market value $246,431 | — | — | Vesting: 25% on 5/20/2023; then 1/12 quarterly thereafter |
| RSUs | 2/23/2024 | 100,000 unvested; market value $1,227,000 | — | — | RSU award; vesting details not further disclosed in proxy |
April 17, 2024 Option Repricing (impact on Sonne):
- Reduced exercise price of certain options to $1.59 and restarted vesting (25% on 3/29/2025; then 1/12 quarterly), incremental value $14,818 recognized for Sonne .
Stock-Price Performance RSU Program (approved by Board Nov 15, 2025; subject to shareholder approval):
| Executive | Total RSUs | Tranche Count | Stock Price Goals | Vesting Mechanics |
|---|---|---|---|---|
| Stephen Sonne | 147,541 | 10 equal tranches | $20, $25, $30, $35, $40, $45, $50, $55, $60, $65 (60 consecutive trading days to achieve each) | Tranches 1–4: 25% at achievement, +25% at 6, 12, 18 months; Tranches 5–8: 25% at achievement, +25% at 3, 6, 12 months; Tranches 9–10: 33.3% at achievement, +33.3% at 3 months, +33.4% at 6 months |
Additional terms:
- Qualifying termination (without cause or for good reason): vests any tranches whose stock-price goals were achieved before termination .
- Change in control: single-trigger vesting of tranches for which the stock-price goal is met using the closing price on the last trading day before closing; non-achieved tranches forfeited .
- Awards require stockholder approval; if not approved by the Annual Meeting expected around June 2026, awards are null and void .
Clawback and Hedging/Pledging Policies:
- Compensation recovery policy (SEC/Nasdaq compliant) for erroneously received incentive-based compensation following certain accounting restatements .
- Insider trading policy prohibits hedging and pledging; a limited pledging waiver was granted only to the CEO (Wolff) for specific tax-related needs; no waiver disclosed for Sonne .
Equity Ownership & Alignment
Beneficial Ownership (as of March 31, 2025; 35,712,516 shares outstanding):
| Holder | Shares Beneficially Owned | % of Outstanding | Breakdown |
|---|---|---|---|
| Stephen Sonne | 77,162 | <1% | 31,173 shares held; 8,995 RSUs scheduled to vest within 60 days; 36,994 options exercisable within 60 days |
Alignment and Restrictions:
- Stock ownership guidelines: not disclosed in proxy.
- Hedging/pledging: generally prohibited; no Sonne pledging disclosed .
- Tax withholding mechanics allow net share withholding or sell-to-cover, which can create episodic selling pressure upon RSU vesting .
Employment Terms
| Term | Detail |
|---|---|
| Employment start | SVP & General Counsel (Feb 2022); CLO & Secretary since Sep 2022 |
| At-will status | Employment agreement has no specific term; at-will employment |
| Base salary | Initial base salary $275,000 per year |
| Target bonus | 50% of base salary |
| Non-compete / confidentiality | Standard confidential information, invention assignment, nonsolicitation and noncompetition agreement executed by NEOs |
| Severance (non-CIC) | Six months’ continued base salary and up to six months COBRA premium reimbursements (or taxable payments in lieu), subject to release and compliance |
| Change-in-control (CIC) period | Three months before to twelve months after CIC; if terminated without cause or for good reason in CIC period: lump-sum six months base salary; lump-sum 100% target bonus; up to six months COBRA reimbursements; 100% accelerated vesting of outstanding equity (performance-based at target unless otherwise specified); subject to release and compliance |
| 280G treatment | Best-net cutback—no tax gross-ups; pay either full amount or reduced amount to avoid excise tax, whichever yields higher after-tax value |
Investment Implications
- Pay-for-performance alignment: Sonne’s new 2025 RSU award is entirely stock-price contingent with multi-year vesting, creating strong alignment with sustained share appreciation and retention through staggered tranche vesting .
- Potential selling pressure: RSU vesting will require tax withholding; company permits net share withholding and sell-to-cover, which can drive event-driven supply around vest dates .
- Retention risk: Outside CIC, severance is modest (six months salary and COBRA), but CIC protection includes accelerated equity and target bonus, reducing departure risk in strategic scenarios .
- Governance and risk controls: Mandatory clawback policy and hedging/pledging prohibitions (with exceptions only for CEO) mitigate misalignment and risk-taking; no Sonne pledging disclosed .
- Execution backdrop: PDYN’s FY2024 revenue growth and materially reduced operating expenses (73% y/y) reflect operational tightening during Sonne’s tenure in the senior leadership team, providing a constructive environment for performance-linked equity awards to drive value creation .