ViewRay (VRAYQ) 10-K/A2022 FY Annual report (amended)

We currently do not anticipate that our definitive proxy statement for our 2023 Annual Meeting of Stockholders will be filed before the 120th day after the end of our last fiscal year. Accordingly, this Amendment No. 1 to Form 10-K (this “Amendment”) is being filed solely to:

Because no financial statements have been included in this Amendment and this Amendment does not contain or amend any disclosure with respect to Items 307 and 308 of Regulation S-K, paragraphs 3, 4 and 5 of the certifications have been omitted. We are not including the certifications under Section 906 of the Sarbanes-Oxley Act of 2002 as no financial statements are being filed with this Amendment.

Except as described above, this Amendment does not modify or update disclosure in, or exhibits to, the Original Form 10-K. Furthermore, this Amendment does not change any previously reported financial results, nor does it reflect events occurring after the date of the Original Form 10-K. Information not affected by this Amendment remains unchanged and reflects the disclosures made at the time the Original Form 10-K was filed. Accordingly, this Amendment should be read in conjunction with the Original Form 10-K and our other filings with the SEC.

In accordance with Nasdaq Rule 5606(a), the following Board Diversity Matrix sets forth the gender identity and demographic background of the Board.

The following is biographical information for our executive officers, including their ages, as of April 10, 2023.

During fiscal 2022, the Company redesignated Dr. Dempsey a Section 16 officer. The related Form 3 was filed on March 21, 2023. In addition, a Form 4 regarding Dr. Dempsey’s forfeiture of shares of common stock to cover tax withholding obligations in connection with the vesting of restricted stock units in October 2022 was filed on March 21, 2023.

The Company has adopted a Code of Business Conduct and Ethics that applies to all employees, including our principal executive officer, principal financial officer and principal accounting officer. The full text of our Code of Business Conduct and Ethics is posted on our website at http://investors.viewray.com/corporate-governance/esg. The Company intends to disclose future amendments to certain provisions of our code, or waivers of such provisions granted to executive officers and directors, on our website within four business days following the date of such amendment or waiver. Any information on ViewRay’s website or which can be accessed through it is not a part of this Amendment or the Original Form 10-K.

Our Audit Committee oversees our corporate accounting and financial reporting process.

The Company maintains employee compensation programs and benefit plans in which our executive officers are participants. Copies of these plans and programs were set forth or incorporated by reference as Exhibits to the Original Form 10-K.

This Executive Compensation section discusses our 2022 compensation program and elements of compensation for the year for each of the following named executive officers (“NEOs”):

For 2022, the primary components of compensation for the NEOs were: (1) base salary, (2) annual incentives, and (3) long-term equity incentives, comprised of both time-based RSUs and performance shares. In determining the amount and relative allocation among each component of compensation for each NEO, the Compensation Committee considered, among other factors, the Company’s and each executive officer’s performance during the year, historical rates of executive compensation, data obtained from management’s recruitment activities, equity previously awarded to employees and equity available for issuance, the comparative review and analysis provided by Willis Towers Watson (“WTW”) and alignment with the Company’s overall compensation philosophy.

Base salaries are set at levels sufficient to attract and retain highly talented executive officers capable of fulfilling the Company’s key objectives. For 2022, the Compensation Committee set the following annual base salary levels for our NEOs after considering market data of similar positions within our peer group and each executive’s individual performance and responsibilities.

We pay annual incentives to management which vary in size depending on the level of achievement of specific financial, operational, and strategic goals considered by the Board to be critical in building long-term value for stockholders. When designing the 2022 annual incentive program for the NEOs, in December 2021, the Board set certain goals, using a mixture of financial and operational performance objectives after receiving input from Mr. Drake. These objectives included financial, system reliability, innovation, quality, and other strategic objectives. Each NEO’s target annual incentive opportunity is expressed as a percentage of base salary which can be earned at between 0% and 200% of target based on the achievement of pre-determined objectives. The following table sets forth a breakdown of the performance objectives, the weighting of each performance objective, actual performance against the target for each performance objective and the resulting payout factor based on such performance.

Our NEOs’ annual incentive is paid out of a bonus pool, the size of which is determined based on the achievement of the goals discussed above. Corporate goals and performance targets are reviewed and approved by the Board prior to any allocation of individual annual incentive bonuses.

The 2022 annual incentive plan was weighted 65% towards financial goals and 35% towards other strategic objectives related to specific initiatives in the areas of: (i) technology and innovation, (ii) clinical, strategic and economic, and (iii) customers and employees.

The Compensation Committee applied purposeful business judgment in selecting the objectives, setting the performance targets, and weighting the performance objectives. The following performance objectives were included for the following reasons:

In early 2023, the Board reviewed our 2022 performance against these pre-established objectives. As outlined above, participants earned their incentives at 134% of their respective targets. The target and actual annual incentives earned by each of the NEOs are set forth in the below table.

Committee increased the relative weighting of performance shares from 33% to 50% of the total target units granted as compared to 2021 annual long-term incentives.

We determined the aggregate number of RSUs and performance shares to be granted to each NEO by dividing each NEO’s target grant date fair value indicated above by the closing market price of our stock as of March 1, 2022. For 2022, the Compensation Committee determined that a total of 50% of the target long-term incentive units would be granted in time-based RSUs that vest ratably over a three-year period with 1/3 vesting on each anniversary of the grant date. RSUs are subject to each NEO remaining a service provider through each such vesting date and allow NEOs to build an equity ownership interest in the Company providing retention and motivation for executive talent. The remaining 50% of the target long-term incentive units were granted in the form of performance shares that will vest at from 0 to 300% of the target units granted based on our compound annual revenue growth rate over a three-year performance period that runs from January 1, 2022 through December 31, 2024. More specifically, achievement of a compound annual revenue growth rate as follows will result in a payout of the following percentage of the target Performance Shares awarded. If the Company’s compound annual revenue growth rate is between threshold and target or between target and maximum, payouts will be linearly interpolated.

When determining the Company’s compound annual revenue growth rate, revenue will be adjusted by the Compensation Committee to exclude the effect of accounting policy changes, legal or regulatory rule or law changes; the impact of any acquisitions or divestitures; the effect of any regulatory, legal or tax settlements; the effect of differences between actual foreign currency exchange rates and those assumed in the financial plans; and any other extraordinary, unusual, and/or nonrecurring items.

Pursuant to its general authority to determine the terms and conditions applicable to awards under the 2015 Plan, the administrator of the 2015 Plan has the right to provide, in an award agreement or otherwise, or to require a holder of an award to agree by separate written or electronic instrument, that: (1) any proceeds, gains or other economic benefit actually or constructively received by the holder upon any receipt or exercise of an award, or upon the receipt or resale of any shares underlying an award, must be paid to the Company, and an award will terminate and any unexercised portion of an award (whether or not vested) will be forfeited, if (a) a termination of service occurs prior to a specified date, or within a specified time period following receipt or exercise of an award, or (b) the holder at any time, or during a specified time period, engages in any activity in competition with the Company, or which is inimical, contrary or harmful to the interests of the Company, as further defined by the Compensation Committee or Board, or (c) the holder incurs a termination of service for “cause”; and (2) all awards (including any proceeds, gains or other economic benefit actually or constructively received by a holder upon any receipt or exercise of any award or upon the receipt or resale of any shares underlying the

award) will be subject to the provisions of any clawback policy implemented by the Company, including, without limitation, any clawback policy adopted to comply with the requirements of applicable law, including the Dodd-Frank Wall Street Reform and Consumer Protection Act and any rules or regulations promulgated thereunder, to the extent set forth in such clawback policy and/or in the applicable award agreement. The Company intends to adopt on a timely basis a clawback policy that is compliant with the final Nasdaq listing standards issued pursuant to SEC Rule 10D-1.

2022 Summary Compensation Table

Each of Messrs. Drake, McCormack and Stassen have entered into employment or severance agreements that provide for severance and change in control payments and benefits.

In addition, Mr. Drake’s equity award agreements provide that, if the Company terminates his employment without Cause, or he resigns for Good Reason, then such equity awards that would otherwise (absent the termination) have vested during the 24 month period following Mr. Drake’s termination shall accelerate and become fully-vested as of the date of termination. Mr. Drake’s equity award agreements also provide that he will have 12 months from the date of any such termination to exercise any remaining stock options. Any other unvested equity awards will be forfeited upon any termination of employment.

Neither Mr. Drake nor his estate or beneficiaries are entitled to any of these payments or benefits upon termination of his employment by reason of his disability or death other than the right to a pro rata annual incentive bonus based on the number of months Mr. Drake was employed in the calendar year prior to such death or disability.

In the event that a Change in Control occurs during Mr. Drake’s employment and his employment is terminated by the Company (or its successor) without Cause or by Mr. Drake for Good Reason at any time three months prior to or 18 months following such Change in Control, then all equity awards issued to and held by Mr. Drake will accelerate and become vested and exercisable as of the date of such termination. A “Change in Control” has the same meaning given to such term in the 2015 Plan.

Pursuant to the employment agreement, “Cause” means Mr. Drake’s: (i) theft or embezzlement of Company funds or assets; (ii) conviction of, or guilty or no contest plea, to a felony charge or any misdemeanor involving moral turpitude; (iii) material violation of any express direction or any rule, regulation or policy established by the board of directors of the Company that is consistent with the terms of the employment agreement; (iv) material breach of the employment agreement or material breach of his fiduciary duties to the Company; (v) fraud, gross incompetence, gross neglect, or gross misconduct in the performance of his duties (including a material violation or breach of any Company policy); or (vi) repeated and consistent failure to perform the duties under the employment agreement during normal business hours except during vacation periods or absences due to temporary illness. If the Board determines in good faith (if Mr. Drake is a member of the Board at such time he shall not be entitled to participate in such determination) that Cause for termination exists and such trigger is curable, he will be given written notice by the Board that provides the factual basis for the determination and Mr. Drake will have 10 business days to respond and to try and cure the condition(s) giving rise to the determination prior to that determination becoming final.

Pursuant to the employment agreement, “Good Reason” means a resignation by Mr. Drake that occurs within 30 days following his first having knowledge of any (i) material reduction in his base salary, (ii) material breach of his employment agreement by the Company, (iii) material diminution of his authority, duties or title or responsibilities imposed by the Board (other than in response to an event constituting Cause), (iv) material reduction in his annual performance bonus or equity compensation opportunity or (v) requirement that Mr. Drake relocate, without consent, in excess of 25 miles beyond the geographic limits of Mountain View, California, Denver, Colorado or Oakwood Village, Ohio or such other location as has been established by the Company as its headquarters in consultation with Mr. Drake; provided, however, with respect to subclause (i) that any reduction of the base salary that is consistent with general reductions in the base salaries of other executives of the Company as part of a plan to avoid insolvency of the Company or manage any financial distress or hardship of the Company will not be deemed to constitute a material reduction in the base salary; and provided, further, with respect to subclause (ii) above, that in the case of a material breach, Good Reason will only exist where Mr. Drake has provided the Company with written notice of the breach within 30 days of the occurrence of the events constituting “Good Reason,” the Company has failed to cure

such breach within 10 business days of such written notice of breach and Mr. Drake actually resigns his employment within 45 days of the occurrence of the events constituting “Good Reason.”

Each of the NEOs (other than Mr. Drake) has entered into a standard severance agreement with the Company. An executive is eligible to receive severance payments and benefits in connection with a termination of employment by the Company without “Cause” (as defined below) or due to their resignation for “Good Reason” (as defined below).

If such a termination of employment occurs within the period commencing 90 days before the occurrence of a “Change in Control” (as defined below) and ending on the 18-month anniversary following the Change in Control (the “Covered Period”), then the executive would be eligible to receive a lump sum severance payment in an amount equal to the sum of: (i) 100% of the executive’s annual base salary; (ii) the executive’s then-current target annual bonus; and (iii) a pro-rata portion of the executive’s target annual bonus for the fiscal year in which the date of termination occurs. If such a termination of employment occurs outside of the Covered Period, then the executive would be eligible to receive a lump sum severance payment in an amount equal to 100% of his annual base salary and a pro-rata portion of the executive’s target annual bonus for the fiscal year in which the date of termination occurs. In the Company’s sole discretion based on the circumstances of an executive’s termination, an executive may be eligible for up to a maximum of $10,000 in outplacement related services.

To the extent that an executive timely and properly elects health insurance continuation coverage under the Company’s group health insurance plan under COBRA, the Company will pay for the cost of the monthly COBRA premium for continuing health insurance coverage as elected by the executive until the earliest of: (i) 18 months (in the event the termination of employment occurs during the Covered Period) or 12 months (in the event the termination of employment occurs outside of the Covered Period); (ii) the date that the executive is no longer eligible to receive COBRA continuation coverage under the Company’s group health insurance plan; and (iii) the date on which the executive secures other employment.

In addition, in the event that (i) a Change of Control occurs during an executive’s employment and (ii) the executive’s employment with the Company is terminated by the Company (or its successor) without Cause or if the executive resigns for Good Reason at any time during the 12-month period following such Change of Control, then (x) without further action by the Company (or its successor) or the Board (or its successor’s board), all unvested units or shares issued under the Company’s equity incentive program will accelerate and become vested and exercisable as of the date of such termination.

An executive’s receipt of such payments and benefits would be subject to their execution and non-revocation of a release of claims in the form attached to their severance agreement and compliance with the restrictive covenants set forth in his severance agreement.

Pursuant to the standard severance agreement, “Cause” means: (i) an executive’s willful failure to perform their duties (other than any such failure resulting from incapacity due to physical or mental illness); (ii) an executive’s willful failure to comply with any valid and legal directive of the person or entity to whom they report; (iii) an executive’s willful engagement in dishonesty, illegal conduct or gross misconduct, which is, in each case, materially injurious to the Company or its affiliates; (iv) an executive’s embezzlement, misappropriation or fraud, related to their employment with the Company; (v) an executive’s conviction of or plea of guilty or nolo contendere to a crime that constitutes a felony (or state law equivalent) or a crime that constitutes a misdemeanor involving moral turpitude, if such felony or other crime is work-related, materially impairs an executive’s ability to perform services for the Company or results in material reputational or financial harm to the Company or its affiliates; or (vi) an executive’s violation of a material policy of the Company. For purposes of this definition, no act or failure to act on an executive’s part will be considered “willful” unless it is done, or omitted to be done, by an executive in bad faith or without reasonable belief that their action or omission was in the best interests of the Company.

Pursuant to the standard severance agreement, “Good Reason” means: (i) a reduction in an executive’s base salary; (ii) a reduction in an executive’s target annual bonus opportunity; (iii) a relocation of an executive’s principal place of employment by more than 50 miles; (iv) the Company’s failure to obtain an agreement from any successor to assume and agree to perform the obligations in the same manner and to the same extent that the Company would be required to perform, except where such assumption occurs by operation of law; or (iv) a material, adverse change in an executive’s title, reporting relationship, authority, duties or responsibilities (other than temporarily while an executive is physically or mentally incapacitated or as required by applicable law).

Pursuant to the standard severance agreement, “Change in Control” means: (i) a sale of all or substantially all of the assets of the Company and its subsidiaries taken as a whole or (ii) a merger, consolidation or other similar business combination involving the Company, if, upon completion of such transaction the beneficial owners of voting equity

securities of the Company immediately prior to the transaction beneficially own less than 50% of the successor entity’s voting equity securities; provided, that “Change of Control” will not include a transaction where the consideration received or retained by the holders of the then outstanding capital stock of the Company does not consist primarily of (i) cash or cash equivalent consideration, (ii) securities which are registered under the Securities Act of 1933, as amended (the “Securities Act”), or any successor statute and/or (iii) securities for which the Company or any other issuer thereof has agreed, including pursuant to a demand, to file a registration statement within 90 days of completion of the transaction for resale to the public pursuant to the Securities Act.

Upon a Change in Control (as defined in the 2015 Plan) prior to the end of the applicable performance period, outstanding performance shares will vest immediately prior to such Change in Control at the greater of the target number of units granted or the performance shares that would have otherwise vested based on actual performance through the end of the fiscal quarter the immediately precedes the date of the Change in Control. Upon a Change in Control that occurs after completion of the performance period but prior to settlement of the award, outstanding performance shares will vest based on actual performance through the end of the performance period.

Mr. Stassen stepped down from his position as Chief Financial Officer on January 6, 2023, and terminated employment with the Company on March 31, 2023. He continues to serve as a consultant to the Company through June 30, 2023, rendering strategic and financial advisory services and helping to ensure a smooth transition to his successor, William P. Burke pursuant to the terms of a Consulting Agreement.

In connection with his departure, and per the terms of his Severance Agreement entered into on May 18, 2020, Mr. Stassen received a lump sum payment of $367,744 in April 2023 and will receive Company-paid COBRA premiums until the earliest of April 30, 2024, the date on which Mr. Stassen is no longer eligible for COBRA coverage, and the date Mr. Stassen secures other employment. Assuming a full 12 months of such coverage, the approximate cost to the Company would be $27,275. Pursuant to his separation and consultancy agreements, Mr. Stassen’s unvested equity grants will be cancelled and forfeited for no consideration as of June 30, 2023.

The following table summarizes the total compensation paid to Mr. Drake as set forth in our Summary Compensation Table, “compensation actually paid” to Mr. Drake, the average total compensation paid to our NEOs (other than Mr. Drake) as set forth in our Summary Compensation Table, and the average “compensation actually paid” to our NEOs (other than Mr. Drake), each as calculated in accordance with SEC rules, as well as Company TSR and Net Income for the periods indicated:

After consulting with the Compensation Committee’s independent consultant and reviewing director compensation practices among our peer group, our Board of Directors increased the annual director retainer, the Board chair retainer, and certain committee membership and chair retainers for 2022. The amounts payable to non-employee directors in 2022 as compared to 2021 are shown in the table below. While the Board considers director compensation annually, market data is currently compiled and assessed every other year.

Pursuant to the Company’s Director Compensation Policy for 2022, each non-employee director received the following cash amounts for their service:

In June 2022, each then serving director received an Annual Grant of 54,511 RSUs that vest on June 13, 2023, subject to the director’s continued service through such vesting date.

As of December 31, 2022, the Company had an active stock-based incentive compensation plan and an employee stock purchase plan: the 2015 Plan, and the 2015 Employee Stock Purchase Plan (as amended and restated, the “ESPP”), respectively. All new equity compensation grants are issued under these two plans; however, outstanding awards previously issued under inactive plans will continue to vest and remain exercisable in accordance with the terms of the respective plans.

The following table sets forth the number of shares of common stock subject to outstanding options and other rights, the weighted-average exercise price of outstanding options, and the number of shares remaining available for future award grants as of December 31, 2022 in each of the equity compensation plans.

(1) Represents the weighted average exercise price of outstanding options.

(2) Includes the ViewRay Incorporated 2008 Stock Incentive Plan (the “2008 Plan”); the 2015 Plan; and the ESPP.

(3) The purpose of the ESPP is to assist employees in acquiring shares of common stock in the Company pursuant to a plan which is intended to qualify as an “employee stock purchase plan” under Section 423 of the Code. The ESPP contains an “evergreen” provision, pursuant to which the number of shares of common stock reserved for issuance under such plan shall be increased on the first day of each year beginning in 2016 and ending in 2025, in each case subject to the approval of the Compensation Committee on or prior to the applicable date, equal to the lesser of (A) one percent (1%) of the shares of stock outstanding (on an as converted basis) on the last day of the immediately preceding fiscal year and (B) such smaller number of shares of stock as determined by the Board; provided, however, no more than 3,500,000 shares of stock may be issued under the ESPP.

(4) Consists of the following: (i) 3,347,532 stock options under the 2015 Plan, (ii) 8,756,873 restricted stock units under the 2015 Plan (including incremental PSUs which have been accrued as of December 31, 2022 based on the expected level of achievement of previously granted awards), and (iii) 458,050 stock options under the 2008 Plan.

(5) Consists of the following: (i) 5,908,329 shares available for future awards under the 2015 Plan, and (ii) 2,883,528 shares available for future awards under the ESPP.

(6) Reflects the 2018 Equity Award Inducement Program (the “2018 Plan”), which was terminated effective April 19, 2022.

(7) Consists of the following: (i) 2,942,998 stock options under the 2018 Plan, and (ii) 72,128 restricted stock units under the 2018 Plan.

The 2018 Plan was adopted by the Board as of July 22, 2018 and was not subject to approval by our stockholders in accordance with the exception from the requirement for the Company’s stockholders to approve equity incentive plans under Nasdaq Listing Rule 5635(c)(4). The purpose of the 2018 Plan was to further the long-term stability and success of the Company by providing a program to reward selected individuals hired as employees of the Company with grants of inducement awards. Unless otherwise provided in the 2018 Plan, the operative terms of any inducement awards granted under the 2018 Plan adhered to the terms and conditions of the 2015 Plan. The Board (or any committee of the Board to whom such authority has been delegated) approves the shares that may be issued under the 2018 Plan, which shares do not count against the shares reserved for issuance or per participant limits that apply under the 2015 Plan. The Board or such committee determined the type, size, exercise price, if applicable, and the methods by which any award granted under the 2018 Plan may be exercised, if applicable, cancelled, forfeited or suspended. The Board terminated the 2018 Plan effective as of April 19, 2022, except with regard to outstanding awards.

The following table presents information as to the beneficial ownership of our common stock as of April 10, 2023, unless noted otherwise, for:

Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Unless otherwise indicated below, to our knowledge, the persons and entities named in the table have sole voting and sole investment power with respect to all shares beneficially owned, subject to community property laws where applicable. Shares of our common stock subject to common stock warrants, options that are currently exercisable or exercisable within 60 days of April 10, 2023, and restricted stock units and performance share awards that vest within 60 days of April 10, 2023, are deemed to be outstanding and to be beneficially owned by the person holding such securities for the purpose of computing the percentage ownership of that person, but are not treated as outstanding for the purpose of computing the percentage ownership of any other person.

Percentage ownership of our common stock in the table is based on 183,389,623 shares of our common stock issued and outstanding on April 10, 2023. Unless noted otherwise, the address of each of the individuals and entities named below is c/o ViewRay, Inc., 1099 18th St Suite 3000, Denver, CO 80202.

The Board is committed to upholding the highest legal and ethical standards of conduct in fulfilling its responsibilities and recognizes that transactions with the Company involving related parties can present a heightened risk of potential or actual conflicts of interest.

Except as described below and except for compensation for employment or services provided in other roles, there has not been, since January 1, 2021, nor is there currently proposed, any transaction to which ViewRay, Inc. is or was a party in which the amount involved exceeds $120,000, and in which any of our current directors, executive officers, holders of more than 5% of any class of our voting securities or any of their respective affiliates or immediate family members, had, or will have, a direct or indirect material interest.

Pursuant to the Cooperation Agreement with Hudson dated March 8, 2022, the Company concurrently entered into a Consulting Agreement with Sai Nanduri, a Senior Investment Analyst and representative of Hudson, pursuant to which the Company was required to pay Mr. Nanduri $160,000 during 2022 and consider Mr. Nanduri as a candidate for election to the Board at the 2023 annual meeting of shareholders. This agreement expired on its terms on January 2, 2023.

Pursuant to the Cooperation Agreement with Hudson dated January 20, 2023, the Company concurrently entered into an Observer Agreement with Mr. Nanduri, pursuant to which Mr. Nanduri was appointed an observer to the Board and for which the Company is required to pay Mr. Nanduri $180,000 during 2023. The Company further agreed to appoint Mr. Nanduri as a member of its Board in the event a current director were to resign.

In December 2004, we entered into a Standard Exclusive License Agreement with Sublicensing Terms with University of Florida Research Foundation, Inc., or UFRF, under which we licensed certain patents from UFRF in exchange for royalty payments and an equity issuance, or the UFRF License Agreement. We entered into an amendment of the UFRF License Agreement in December 2007. Since December 2004 to December 2018, we have paid UFRF $1,652,763 in royalties and $63,000 in patent and legal fees pursuant to the terms of the UFRF License Agreement. In addition, in December 2004, we issued 11,312 shares of common stock to UFRF pursuant to the terms of the UFRF License Agreement, which required us to issue UFRF a certain number of shares of common stock upon execution of the UFRF License Agreement, as well as issue UFRF additional shares of common stock to maintain UFRF’s ownership of 5% of our outstanding equity until certain financing conditions were satisfied. We satisfied these financing conditions in 2013 and have no further obligations to issue UFRF shares of our common stock pursuant to the terms of the UFRF License Agreement. Prior to the consummation of the private placement on 2015, UFRF was a beneficial owner of approximately 0.10% of our capital stock on an as-converted basis. In connection with his former employment at the University of Florida and his role in the development of the licensed patents under the UFRF License Agreement, as amended, James F. Dempsey, Ph.D., our Chief Scientific Officer, receives a percentage of the royalty payments we pay to UFRF and is entitled to a percentage of any proceeds from the sale of common stock by UFRF. Specifically, under the University of Florida’s intellectual property policy, Dr. Dempsey is entitled to (i) 40% of any royalty payments we pay to UFRF or proceeds from the sale of common stock by UFRF of up to $500,000 and then (ii) 25% of any royalty payments we pay to UFRF or proceeds from the sale of common stock by UFRF over $500,000.

In November 2019, the Company entered into a distribution agreement with Chindex Shanghai International Trading Company Limited, or Chindex, which became effective in February 2020. Chindex is a subsidiary of Fosun International Limited, or Fosun.

Under the distribution agreement, Chindex acts as the Company’s distributor and regulatory agent for the sale and delivery of its MRIdian products within the People’s Republic of China, excluding Hong Kong, Macau and Taiwan. The distribution agreement has an initial term of five years with an option to renew for an additional five years. Under the distribution agreement, the Company will supply its products and services to Chindex based on an agreed upon price between the Company and Chindex. In accordance with the agreement, Chindex agreed to pay ViewRay an upfront fee, portions of which may be refundable under certain conditions, of $3.5 million, payable in three installments: (i) the first installment of $1.5 million due approximately 60 days after the effectiveness of the distribution agreement; (ii) the second installment of $1.0 million due on the first anniversary from the effective date of the agreement; and (iii) the third installment of $1.0 million due on the second anniversary from the effective date of the agreement. The Company has received all three installments as of December 31, 2022.

On November 16, 2021, we entered into an underwriting agreement with Piper Sandler & Co. and Stifel, Nicolaus & Company, as representatives of several underwriters named therein, in connection with the issuance and sale of 12,500,000 shares of our common stock at a public offering price of $5.60 per share. In addition, we granted the underwriters a 30-day option to purchase up to 1,875,000 additional shares of common stock on the same terms, which the underwriters exercised in full. We completed the offering on November 18, 2021 and received net proceeds of approximately $75.1 million, after deducting underwriting discounts and commissions and offering expenses payable by us.

In connection with the offering Mr. Drake, our President, Chief Executive Officer and a Director, and Mr. Stassen, our former Chief Financial Officer, purchased 89,285 and 17,857 shares of common stock, respectively, at the public offering price of $5.60 per share. The offering and the participation of these officers therein was approved by the Board.

Our certificate of incorporation and bylaws provide that we are required to indemnify our directors and officers, in each case to the fullest extent permitted by Delaware law. Our bylaws also provide that we are obligated to advance expenses incurred by a director or officer in advance of the final disposition of any action or proceeding, and permit us to secure insurance on behalf of any officer, director, employee or other agent for any liability arising out of his, her or its actions in that capacity regardless of whether we would otherwise be permitted to indemnify him, her or it under Delaware law.

In addition to the indemnification required in our certificate of incorporation and bylaws, we have or will enter into indemnification agreements with each of our directors and executive officers. These agreements, among other things, require us to indemnify each director (and in certain cases their related venture capital funds) and executive officer to the fullest extent permitted by Delaware law, including indemnification of expenses such as attorneys’ fees, judgments, fines and settlement amounts incurred by the director or executive officer in any action or proceeding, including any action or proceeding by or in right of us, arising out of the person’s services as a director or executive officer.

Please see “Director Compensation” and “Executive Compensation” for information regarding compensation of directors and executive officers.

We have previously entered into employment agreements with our executive officers. For more information regarding these agreements, see “Executive Compensation—Potential Payments upon Termination or Change in Control.”

As required under Nasdaq rules and regulations, a majority of the members of a listed company’s board of directors must qualify as “independent,” as affirmatively determined by the board of directors. The board of directors consults with the Company’s counsel to ensure that the board of directors’ determinations are consistent with all relevant securities and other laws and regulations regarding the definition of “independent,” including those set forth in pertinent Nasdaq listing standards, as in effect from time to time.

Consistent with these considerations, the Board has determined that Messrs. Moore, Roberts, and Spencer, Drs. Castelein and Wilensky, and Mmes. Johnson, Schnabel and Prange qualify as “independent” directors in accordance with the Nasdaq listing requirements. Mr. Drake is not considered independent because he is an employee of ViewRay. During his service on the board of directors, former director Dr. Xie also qualified as an “independent” director in accordance with the Nasdaq listing requirements.

The Nasdaq independence definition includes a series of objective tests, such as that the director is not, and has not been for at least three years, one of our employees and that neither the director nor any of his family members has engaged in various types of business dealings with us. In addition, as required by Nasdaq rules, the Board has made a subjective determination as to each independent director that no relationships exist, which, in the opinion of the Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In making these determinations, the Board considered information provided by the directors and us with regard to each director’s business and personal activities and relationships as they may relate to us and our management. There are no family relationships among any of our directors or executive officers.

As required under Nasdaq rules and regulations, our independent directors meet in regularly scheduled executive sessions at which only independent directors are present. The Audit, Compensation and Nominating and Corporate Governance committees are comprised entirely of directors determined by the Board to be independent within the meaning of Nasdaq and SEC rules and regulations applicable to the members of these committees.

(a) (1) The financial statements required by Item 15(a) are filed in Item 8 of the Original Form 10-K.

(2) The financial statement schedules required by Item 15(a) are omitted because they are not applicable, not required or the required information is included in the financial statements or notes thereto as filed in Item 8 of the Original Form 10-K.

(3) We have filed, or incorporated into this report by reference, the exhibits listed below.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on April 28, 2023.