Company: AAOI
Filing Date: 2025-02-28
Form Type: PRE 14A
Source: 0001104659-25-019126
Chunk: 30

Company: APPLIED OPTOELECTRONICS, INC.
Filing Date: 2025-02-28
Form: PRE 14A
Chunk 30
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 New Customer Order target was to receive a total purchase order of $1,000,000 (“Minimum Order”) from each of the two New Customers in 2024. In 2024, the Company exceeded this target by obtaining the Minimum Order set forth under Target 2 from three New Customers, earning the maximum payout for Target 2.

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TABLE OF CONTENTS

The compensation committee determined that the Company’s aggregate achievement under the two 2024 Targets for the short-term annual cash incentive plan was 62.5%. Additional details are provided below under the heading “2024 Annual Cash Bonuses.”

#### Objectives of our Compensation Program
We have designed our executive compensation program to achieve the following primary objectives:

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Management Development and Continuity . Provide compensation and benefit levels that will attract, retain, motivate, and reward a highly talented team of executive officers within the context of responsible cost management;

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Pay-for-Performance. Establish a direct link between our financial and operational results and strategic objectives and the compensation of our executive officers; and

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Long-Term Focus on Stockholder Value . Align the interests and objectives of our executive officers with those of our stockholders by linking the long-term incentive compensation opportunities to stockholder value creation and their cash incentives to our annual performance.

### 2024 Compensation Program Overview
The compensation committee took the following key actions with respect to the compensation of our NEOs for 2024, mindful of the need to balance rigorous pay-for-performance with the need to retain our critical talent:

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#### Base Salary
— Approved annual base salary increases were set at a range between 7% to 12% (which percentage, solely with respect to Mr. Yeh, is calculated based on his base salary as denominated in NTD (New Taiwan dollars) and RMB (Chinese Yuan Renminbi) on the date the increase was approved), due to the market study by Aon plc (“Aon”) which presented a below market cash basis for our executives.

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#### Annual Cash Bonuses
— Established two targets based on critical business objectives that were rigorous, aggressive and challenging.

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#### Long-Term Incentive Compensation
— Established performance-based and time-based equity grants. The performance-based awards have a minimum, reduced, target and maximum award levels for each of our executive officers based on a dollar value with performance goals based on the attainment of a stock price hurdle and TSR over a three-year period compared to the Company’s peer group.

The compensation committee set the total target pay mix set for