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Item 9A. Controls and Procedures

2022-03-28 compared with 2021-03-25 · 1803 added, 1217 removed, 73 unchanged (98% of the section changed)

1 unchanged sentence

Evaluation of Disclosure Controls and Procedures

Disclosure controls are procedures that are designed with the objective of ensuring that information required to be disclosed in our reports filed under the

Exchange Act, such as this Report, is recorded, processed, summarized, and reported within the time period specified in the SECs rules and forms.

Disclosure controls are also designed with the objective of ensuring that such information is

accumulated and communicated to our management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Our management evaluated, with the participation of our

principal executive officer and principal financial and accounting officer (our Certifying Officers), the effectiveness of our disclosure controls and procedures as of December 31, 2020, pursuant to Rule 13a-15(b) under the Exchange Act.

Based upon that evaluation, our Certifying Officers concluded that, as of December 31, 2020, our disclosure controls and procedures were effective.

We do not expect that our disclosure controls and procedures will prevent all errors and all

instances of fraud.

Disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met.

Further, the design of

disclosure controls and procedures must reflect the fact that there are resource constraints, and the benefits must be considered relative to their costs.

Because of the inherent limitations in all disclosure controls and procedures, no evaluation

of disclosure controls and procedures can provide absolute assurance that we have detected all our control deficiencies and instances of fraud, if any.

The design of disclosure controls and procedures also is based partly on certain assumptions

about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

Internal Control over Financial Reporting

Report on Form 10-K does not include a report of managements assessment regarding internal control over financial reporting or an attestation report of our registered public accounting firm due to a transition period established by rules

of the SEC for newly public companies.

During the most recently completed fiscal year, there has been no change in our internal control over financial

reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

We maintain “disclosure controls and procedures,” as defined in Rules 13a-15(e)

and 15d-15(e)

under the Securities Exchange Act of 1934, as amended, or the Exchange Act, that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is (1) recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms and (2) accumulated and communicated to our management, including our principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure.

Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e)

and 15d-15(e)

under the Exchange Act), as of the end of the period covered by this Annual Report.

Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of December 31, 2021, our disclosure controls and procedures were not effective at a reasonable assurance level as a result of the material weakness that existed in our internal control over financial reporting as described below, and which continues to exist.

Management’s Annual Report on Internal Control Over Financial Reporting

This Annual Report does not include a report of management’s assessment regarding internal control over financial reporting as allowed by the SEC for reverse acquisitions between an issuer and a private operating company when it is not possible to conduct an assessment of the private operating company’s internal control over financial reporting in the period between the consummation date of the reverse acquisition and the date of management’s assessment of internal control over financial reporting (see Section 215.02 of the SEC Division of Corporation Finance’s Regulation S-K Compliance & Disclosure Interpretations).

As discussed elsewhere in this Annual Report, we completed a business combination on September 30, 2021 pursuant to which we acquired Legacy IonQ.

Prior to the business combination, we were a special purpose acquisition company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, recapitalization, reorganization or similar business combination with one or more businesses.

As a result, previously existing internal controls are no longer applicable or comprehensive enough as of the assessment date, as our operations prior to the business combination were insignificant compared to those of the consolidated entity post-business combination.

As a result, management was unable, without incurring unreasonable effort or expense, to complete an assessment of our internal control over financial reporting as of December 31, 2021.

Material Weakness in Internal Control Over Financial Reporting

In connection with the preparation of our financial statements as of and for the fiscal year ended December 31, 2021, we identified a material weakness in our internal control over financial reporting specifically related to our financial statement close process.

Specifically,

Although we recently added accounting and financial reporting personnel with requisite knowledge and experience in the application of U.S.

GAAP and SEC rules, the Company is still in process of formalizing its processes and procedures, establishing clear authorities and approvals and segregating duties to facilitate accurate and timely financial reporting.

Our financial accounting system has limited functionality and does not facilitate effective information technology general controls relevant to financial reporting.

Additionally, elements of our close process are managed and processed outside the accounting system, increasing the risk of error.

This material weakness could result in a misstatement of account balances or disclosures that would result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or detected.

Remediation Efforts to Address the Material Weakness

In light of the material weakness identified, we are implementing a remediation plan which includes measures designed to improve our internal control over financial reporting to remediate this material weakness.

These measures include adding resources (both internal and external) as well as improving the control environment around financial systems and processes.

In 2021, the Company completed the following remedial actions:

Hired additional full-time accounting personnel with appropriate levels of experience, and augmented skills gaps with external experts;

Established and implemented policies surrounding the approval of transactions, related to, but not limited to, account reconciliations and journal entries;

Selected and began implementing a financial accounting system that can support effective information technology general controls as well as the anticipated growth of the business.

Our management believes that these actions, and additional actions to be taken under our remediation plan, are sufficient to remediate the material weakness identified and strengthen our internal control over financial reporting.

The actions we are taking are subject to ongoing senior management review, as well as Audit Committee oversight.

The material weakness will not be considered remediated until our remediation plan has been fully implemented, the applicable controls operate for a sufficient period of time, and we have concluded, through testing, that the newly implemented and enhanced controls are operating effectively.

Attestation Report of the Registered Public Accounting Firm

This Annual Report does not include an attestation report of our registered public accounting firm due to an exemption for “emerging growth companies.”

Changes in Internal Control over Financial Reporting

Except as described above under Remediation Plan, there were no changes in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of

the Exchange Act that occurred during the period covered by this Annual Report on Form 10-K that

has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Other Information.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

Not applicable.

Directors, Executive Officers and Corporate Governance.

Directors and Executive Officers

Our officers and

directors are as follows:

The brief biographies below include information, as of March 15, 2022, regarding the specific and particular experience, qualifications, attributes and skills for each member of our board of directors.

Peter Chapman

President & Chief Executive Officer and Director

Chief Technology Officer and Director

Craig Barratt

Chairman of the Board

Ronald Bernal

Niccolo de Masi

Chief Executive Officer and Director

Darla Anderson

Francesca Luthi

Niccolo de Masi has been our Chief Executive Officer and a director since September 2020.

de Masi has been dMYs Chief Executive Officer and a director since June 2020.

de Masi is also a director of Rush Street Interactive, Inc.

since December 2020 and the chief executive officer and director of dMY Technology

Peter Chapman

has served as a member of our board of directors and president and chief executive officer since the closing of the business combination in September 2021.

Chapman previously served as Legacy IonQ’s president and chief executive officer and a member of its board of directors since May 2019.

From September 2014 to May 2019, Mr.

Chapman served as a director of engineering for Amazon Prime at Amazon.com, Inc.

prior to joining IonQ.

Before that, Mr.

Chapman was the president at Media Arc, Inc.

We believe Mr.

Chapman is well qualified to serve as a member of our board of directors because of his prior leadership and officer positions at technology and software companies.

has served as a member of our board of directors and chief strategy officer since the closing of the business combination in September 2021.

Kim is the co-founder

of Legacy IonQ and served as its chief strategy officer and a member of its board of directors since September 2015.

Kim assumed the role of chief technology officer in 2020.

Kim has served as assistant/associate/full professor in the Department of Electrical and Computer Engineering, Department of Physics and Department of Computer Science at Duke University since June 2004.

From 2006 to 2020, Dr.

Kim was also the founder and president and chief executive officer of Applied Quantum Technologies, Inc.

Kim received a B.S.

in physics from Seoul National University and a Ph.D.

in physics from Stanford University.

We believe Dr.

Kim is well qualified to serve as a member of our board of directors because of his extensive research in electrical and computer engineering and quantum mechanics.

Craig Barratt

has served as a member of our board of directors and chairman of the board since the closing of the business combination in September 2021.

Barratt served as a member of Legacy IonQ’s board of directors since January 2021.

Until May 2020, Dr.

Barratt served as senior vice president and general manager of the Connectivity Group of Intel Corporation, a semiconductor company, since its acquisition of Barefoot Networks, Inc., a computer networking company, in July 2019, where he previously served as president and chief executive officer since April 2017.

From June 2013 to January 2017, Dr.

Barratt held several different roles at Google, including senior vice president, access and energy and advisor.

Barratt previously served as president of Qualcomm Atheros, the networking and connectivity subsidiary of Qualcomm Inc., and as president, chief executive officer and a director of Atheros Communications, Inc., a fabless semiconductor company, until its acquisition by Qualcomm.

Barratt has also served as a member of the board of directors of Intuitive Surgical, Inc., a robotic-assisted surgery company, since April 2011 and as chairman of the board of directors since April 2020.

Barratt received a B.E.

in electrical engineering and a B.S.

in pure mathematics and physics from the

University of Sydney, Australia as well as an M.S.

in electrical engineering from Stanford University.

We believe Dr.

Barratt is qualified to serve as a member of our board of directors because of his senior leadership roles at industry leading companies in the technology sector.

Ronald Bernal

has served as a member of our board of directors since the closing of the business combination in September 2021.

Bernal served as a member of Legacy IonQ’s board of directors since February 2017.

Bernal has served as a venture partner at New Enterprise Associates since February 2010.

From May 2006 to February 2010, Mr.

Bernal was a partner at Sequel Venture Partners prior to joining New Enterprise Associates.

Prior to that, Mr.

Bernal was a partner at Sutter Hill Ventures and was vice president of operations and chief development officer at Cisco Systems, Inc.

Bernal currently serves on the board of directors of Cohere Technologies, Inc., and Tigera Inc.

Bernal received a B.S.

in electrical engineering from DeVry Institute of Technology.

We believe Mr.

Bernal is qualified to serve as a member of our board of directors because of his integral involvement in the technology industry, generally, and management roles at global venture capital firms.

has served as a member of our board of directors since the closing of the business combination in September 2021.

Byers served as a member of Legacy IonQ’s board of directors since February 2017.

In March 2021, Dr.

Byers founded Byers Capital, a venture capital investment firm.

Prior to founding Byers Capital, Dr.

Byers was a general partner at GV (formerly Google Ventures), a venture capital investment firm, from April 2010 to March 2021.

Byers has served as a member of the board of directors of Magenta Therapeutics since April 2017, and is currently Chairman of the board of directors of Pact Pharma, Inc.

and previously served as their president from February 2018 to October 2018.

Byers also serves on the board of directors of several private companies, including Spotlight Therapeutics.

Prior to joining GV, Dr.

Byers helped start two companies, led research projects on biomedical engineering at Stanford University and was an angel investor.

Byers received a Ph.D.

in bioengineering from Stanford University and holds a B.S in biomedical engineering and a B.S in economics from Duke University.

We believe Dr.

Byers is qualified to serve as a member of our board of directors because of his substantial involvement with venture capital investment firms and prior board positions at various biotechnology companies.

Niccolo de Masi

has served as a member of our board of directors since the closing of the business combination in September 2021, and was the chief executive officer and board member of our predecessor, dMY Technology Group, Inc.

III, since inception.

Since June and December 2020, respectively, Mr.

de Masi has also served as the chief executive officer and director of dMY Technology Group, Inc.

II and dMY Technology Group, Inc.

de Masi has been a member of the board of directors of Glu since January 2010, and has served as chairman since December 2014, as interim chairman from July 2014 to December 2014 and as

president and chief executive officer from January 2010 to November 2016.

de Masi was the chief innovation officer at Resideo Technologies, Inc.

from February 2019 to March 2020, a member of its board of directors from October 2018 to

January 2020, and was president of products and solutions from February 2019 until January 2020.

de Masi served as the president of Essential from November 2016 to October 2018.

de Masi served on the board of directors of Xura and

its audit committee from November 2015 until August 2016.

From 2008 to 2009, Mr.

de Masi led Hands-On Mobile as its chief executive officer.

From 2004 to 2007, Mr.

de Masi was the chief executive

officer of Monstermob.

de Masi serves on the Leadership Council of the UCLA Grand Challenges.

de Masi received his B.A.

degrees in physics from Cambridge University.

de Masis qualifications to serve on our

board of directors include his extensive leadership experience in the mobile app space, his track record in our target industry and his network of contacts in the technology sector.

You has been our Chairman since June 2020.

You has been dMYs Chairman since September 2020.

is also a director of Rush Street Interactive, Inc.

since December 2020 and Coupang, Inc.

He has also been the co-chairman

of the board of directors of AdMY Technology Group, Inc.

since January 2021.

He is also the chairman of dMY Technology Group, Inc.

II and dMY Technology Group, Inc.

You served as the executive vice

president of EMC in the office of the chairman from 2008 to 2016.

From 2008 to 2016, Mr.

You served as the executive vice president of EMC in the office of the chairman.

From January 2020 to December 2020, Mr.

de Masi served as Chief Executive Officer of dMY Technology Group, Inc.

and has served as director of Rush Street Interactive, Inc.

since December 2020, following its business combination with dMY Technology Group, Inc.

Since January 2010, Mr.

de Masi has been a member of the board of directors of Glu Mobile Inc., a publicly traded mobile gaming company.

Since December 2014, he has served as chairman and he served as interim chairman from July 2014 to December 2014.

From January 2010 to November 2016, he served as its president and chief executive officer.

From February 2019 to March 2020, Mr.

de Masi was the chief innovation officer at Resideo Technologies, Inc., a publicly traded securities solutions company.

From October 2018 to January 2020, he served as a member of its board of directors and from February 2019 until January 2020 he served as its president of products and solutions.

From November 2016 until October 2018, Mr.

de Masi previously served as the president of Essential Products, Inc.

de Masi served on the board of directors of Xura, Inc.

and its audit committee from November 2015 until August 2016.

de Masi was also previously the chief executive officer and Director of Hands-On

Mobile and Monstermob Ltd.

Since November 2015, Mr.

de Masi has served on the Leadership Council of the UCLA Grand Challenge.

de Masi received a B.A.

in physics from Cambridge University.

We believe Mr.

de Masi is qualified to serve as a member of our board of directors because of his breadth of experience as both an officer and board member at a variety of publicly traded technology companies.

has served as a member of our board of directors since December 2021.

Since April 2019, Mr.

Singh has served as Executive Vice President and Chief Financial Officer of Arm Limited, a British

semiconductor and software design company, where he leads the global finance organization as well as corporate IT operations, procurement and enterprise security teams.

From November 2016 to April 2019, Mr.

Singh served as Senior Vice President and Chief Financial Officer, and from March 2016 to November 2016, as Chief Strategy and Marketing Officer, of Unisys Corp., a publicly listed company.

Prior to that, Mr.

Singh was a Managing Director at SunTrust Bank’s equities unit, and a Senior Vice President in finance at Comcast Corporation.

Singh is currently a member of the board of directors of Affinity Federal Credit Union, a U.S.

financial services firm.

Singh has also advised startups as a member of Columbia University’s Entrepreneurship Advisory Board, and participates as a project advisor for the U.S.

Department of Homeland Security on national security and critical infrastructure issues.

Singh received an M.B.A.

in finance from New York University and holds M.S.

degrees in engineering from Columbia University.

We believe Mr.

Singh is qualified to serve as a member of our board of directors because of his finance and corporate management roles within various organizations and his general involvement in the technology and infrastructure industry.

has served as a member of our board of directors since the closing of the business combination in September 2021, and was the chief financial officer and chairman of the board of directors of our predecessor, dMY Technology Group, Inc.

III, since inception.

Since April 2021, Mr.

You has served on the board of directors of Genius Sports Ltd., a publicly traded sports data and technology company, after its acquisition of dMY Technology Group II, where Mr.

You had served as a director since June 2020.

Since March 2021, Mr.

You has served on the board of directors of Coupang, Inc, a south Korean publicly traded e-commerce

Since December 2020, Mr.

You has also served as the chairman of dMY Technology Group, Inc.

From January 2020 to December 2020, Mr.

You served as chairman of the board of directors of dMY Technology Group, Inc.

and has served as director of Rush Street Interactive, Inc.

since December 2020, following its business combination with dMY Technology Group, Inc.

Since January 2019, Mr.

You has served as a member of the board of directors of Broadcom Inc., a publicly traded semiconductor and software company.

In September 2016, Mr.

You founded GTY, in which Mr.

as its president, chief financial officer and director until February 2019 when GTY consummated its initial business combination, served as its president from February 2019 to May 2019 and as its chief financial officer from February 2019 through

August 2019, and has served as its vice chairman since May 2019.

You also served as GTYs president from May 7, 2019 to May 20, 2019.

You served as a director of Korn/Ferry International from 2004 to October 2016 and

has been a trustee of the U.S.

Olympic Committee Foundation since August 2016.

You was chief executive officer of BearingPoint from 2005 to 2007.

You also served as BearingPoints interim chief financial officer from 2005 to

From 2004 to 2005, Mr.

You served as executive vice president and chief financial officer of Oracle, and was also a member of the board of directors of Oracle Japan.

You founded GTY Technology Holdings, Inc.

”), a publicly traded technology company.

From September 2016 until February 2019, Mr.

You served as its president, chief financial officer and director when GTY consummated its initial business combination.

From February 2019 to May 2019, he served as its president and from February 2019 through August 2019 he served as its chief financial officer.

Since May 2019, he has served as its vice chairman of the board of directors.

From May 7, 2019 to May 20, 2019, Mr.

You also served as GTY’s president.

From February 2008 to September 2016, Mr.

You served as the executive vice president of EMC Corporation (formerly NYSE:

EMC) in the office of the chairman.

You was chief executive officer at BearingPoint (formerly KPMG Consulting, Inc.) as well as chief financial officer of Oracle and Accenture.

You also previously spent 14 years on Wall Street, including serving as a managing director in the Investment Banking Division of Morgan Stanley, where he headed the Computer and Business Services Group.

From 2004 to October 2016, Mr.

You served as a director of Korn/Ferry International.

From 2004 to 2005, he served as a director of Oracle Japan, Since August 2016, Mr.

You has been a trustee of the U.S.

Olympic Committee Foundation.

You received a B.A.

in economics from Harvard College and an M.A.

in economics from Yale University.

We believe Mr.

You is qualified to serve as a member of our board of directors because of his extensive and varied experience as both a senior executive and board member at a variety of publicly traded technology and software companies.

Executive Officers

The following table sets forth information regarding our executive officers who are not listed above a members of our board of directors as of March 15, 2022, other than with respect to Ms.

Babinski whose employment with us commenced on March 28, 2022:

Executive Officers

Christopher Monroe

Chief Scientist

Thomas Kramer

Chief Financial Officer

Laurie Babinski

General Counsel and Secretary

Christopher Monroe

has served as our chief scientist since the closing of the business combination in September 2021.

Monroe is the co-founder

of Legacy IonQ and served as its chief scientist since September 2016.

From August 2018 until May 2019, Dr.

Monroe served as IonQ’s chief executive officer.

Monroe has served as a Professor of Electrical Computer Engineering and Physics at Duke University since January 2021.

Monroe held various positions at the University of Maryland, including from January 2021 to present as a College Park Professor, from 2015 to December 2020 as a Distinguished University Professor of Physics, from September 2018 to December 2020 as a Professor of Electrical and Computer Engineering, and from September 2007 to December 2020 as a Bice Zorn Professor of Physics.

From 2014 to December 2020, Dr.

Monroe was a Fellow at the Center for Quantum Information and Computer Science and from 2007 to December 2020, Dr.

Monroe was a Fellow at the Joint Quantum Institute.

Monroe also held various academic and research positions at the University of Michigan, Ann Arbor, University of Colorado, Boulder, and the National Institute of Standards and Technology.

Monroe serves on advisory boards at several academic institutions, including the Max Planck Institute of Quantum Optics (since 2018), the CalTech Institute for Quantum Information (since 2018), the Center for Quantum Technology, National University of Singapore (since 2018).

Monroe received an S.B.

in physics from Massachusetts Institute of Technology and a Ph.D.

in physics from the University of Colorado, Boulder.

Thomas Kramer

has served as our chief financial officer since the closing of the business combination in September 2021, and as our secretary from September 2021 to March 2022.

Kramer served as Legacy IonQ’s chief financial officer since February 2021.

From February 2017 to February 2021, Mr.

Kramer served as managing director of Remarque Advisory.

From November 2011 to October 2016, Mr.

Kramer also served as chief financial officer of Opower, Inc., a cloud-based enterprise software company in the utilities space.

From 2000 to 2011, Mr.

You served as chief financial officer of

You also previously spent fourteen years on Wall Street, including serving as a managing director in the Investment Banking Division of Morgan Stanley, where he headed the Computer and Business Services Group.

served as a member of the board of directors of Broadcom Inc.

since January 2019.

You holds an M.A.

in Economics from Yale University and a B.A.

in Economics from Harvard College.

Yous qualifications to serve on our board of

directors include his extensive and varied deal experience throughout his career, including his experience structuring Dells acquisition of EMC as EMCs executive vice president, his network of contacts in the technology sector, and his

prior special purpose acquisition company experience with GTY.

Anderson has served on our Board since November

Anderson is an Academy Award and Golden Globe winning feature film producer.

From 1993 to March 2018, Ms.

Anderson was a producer at Pixar Animation Studios, where she produced films such as Coco, Toy Story

3, Cars, A Bugs Life and Monsters, Inc. Following her tenure at Pixar, Ms.

Anderson joined Netflix as a producer.

Anderson was elected to the Producers Council Board of the Producers

Guild of America in July 2008.

Prior to joining Pixar, Ms.

Anderson worked with Angel Studios as the executive producer of their commercial division.

Anderson holds a B.A.

degree in Environmental Science from San Diego State

Andersons qualifications to serve on our Board include her substantial leadership experience in the entertainment industry.

Francesca Luthi has served on our Board since November 2020.

currently serves as the executive vice president and chief communications and marketing officer at Assurant, Inc.

After joining Assurant in 2012, Ms.

Luthi was the senior vice president of investor relations, marketing and

communications from 2014 until 2015 and then served as the companys chief communications and marketing officer until 2020.

Prior to joining Assurant, Ms.

Luthi served as the senior vice president of corporate communication and investor

relations at Accretive Health.

Before this, Ms.

Luthi held senior-level investor relations and communication roles at BearingPoint and Accenture.

Luthi also helped establish the investor relations department at Omnicom Group after

serving as a financial analyst in the Investment Banking Division at Morgan Stanley.

Luthi holds a B.S.

degree in Economics from Georgetown Universitys School of Foreign Service.

Luthis qualifications to serve on our

Board include her financial and business strategy expertise.

Wert has served on our Board since November 2020.

Wert has served as a director and chairman of the audit committee of GTY (Nasdaq:

GTYH) since completion of its IPO in 2016.

Kramer served as chief financial officer of Cvent, Inc., a cloud-based enterprise software company in the event-management space.

From 1998 to 2000, Mr.

Wert served as the vice chairman and as a director at Evercore Trust Company, N.A., or

Evercore, which he formed and organized and was previously the president and chief executive officer from 2009 to 2014.

Prior to joining Evercore, Mr.

Wert served as an executive vice president and senior trust officer of U.S.

Trust Company

for over 20 years.

Wert also founded United Mercantile Bank and Trust Company and served as its president and senior trust officer from 1982 until 1987.

Wert is the principal of Fiduciary Resolutions, where he has been a

fiduciary expert since June 2016, providing expert witness services and analysis as well as reviewing corporate governance and other processes use by fiduciaries.

Wert holds a bachelors degree in Business Administration and Finance

from California State University at Los Angeles.

Werts qualifications to serve on our Board include his track record and leadership experience at GTY, Evercore, U.S.

Trust Company N.A.

and United Mercantile Bank and Trust Company.

Number and Terms of Office of Officers and Directors

Our Board consists of 5 members and is divided into three classes with only one class of directors being elected in each year, and with each class (except for

those directors appointed prior to our first annual meeting of stockholders) serving a three-year term.

In accordance with NYSE corporate governance requirements, we are not required to hold an annual meeting until one year after our first fiscal

year end following our listing on NYSE.

The term of office of the first class of directors, consisting of Ms.

Anderson, will expire at our first annual meeting of stockholders.

The term of office of the second class of directors, consisting of

Luthi and Mr.

Wert, will expire at the second annual meeting of stockholders.

The term of office of the third class of directors, consisting of Mr.

de Masi, will expire at the third annual meeting of stockholders.

Our officers are appointed by dMYs board of directors and serve at the discretion of the board, rather than

for specific terms of office.

dMYs board of directors is authorized to appoint officers as it deems appropriate

pursuant to our amended and restated certificate of incorporation.

Committees of the Board of Directors

directors has three standing committees:

an audit committee, a compensation committee and a nominating and corporate governance committee.

Subject to phase-in rules, the rules of NYSE and Rule 10A-3 of the Exchange Act require that the audit committee of a listed company be comprised solely of independent directors, and the rules of the NYSE require that the compensation committee and the nominating and

corporate governance committee of a listed company be comprised solely of independent directors.

Kramer served as a consultant at the Boston Consulting Group.

Kramer holds an M.B.A.

from Harvard Business School and an M.S.

in economics from the Norwegian School of Economics.

Laurie Babinski

has served as our general counsel and secretary since March 2022.

From December 2019 to March 2022, Ms.

Babinski served as deputy general counsel at Credit Karma, LLC, a multinational personal finance company, where she also served in various roles from August 2015 to December 2019, including as the lead of numerous legal functions such as product, marketing, regulatory, privacy, litigation, employment and government relations in the United States, Canada and the United Kingdom.

Prior to that, Ms.

Babinski worked at the law firm Baker Hostetler LLP practicing in the Media, Technology and Intellectual Property group.

Babinski received a J.D.

from Northwestern University Pritzker School of Law and holds a B.A.

in Journalism and Spanish from Pepperdine University.

Family Relationships

There are no family relationships among any of our directors or executive officers.

Audit Committee

We have established an audit committee of the board of directors.

Anderson, Ms.

Luthi and Mr.

Wert serve as members of our audit committee,

Luthi chairs the audit committee.

Under the NYSE listing standards and applicable SEC rules, we are required to have at least three members of the audit committee, all of whom must be independent.

Luthi and Mr.

Wert meet the independent director standard under NYSE listing standards and under Rule 10-A-3(b)(1) of the Exchange Act.

Each member of the audit committee is financially literate and our board of directors has determined that

Luthi qualifies as an audit committee financial expert as defined in applicable SEC rules and has accounting or related financial management expertise.

We have adopted an audit committee charter, which details the principal functions of the audit committee, including:

assisting board oversight of (1) the integrity of our financial statements, (2) our compliance with

legal and regulatory requirements, (3) our independent registered public accounting firms qualifications and independence, and (4) the performance of our internal audit function and independent registered public accounting firm;

appointment, compensation, retention, replacement, and oversight of the work of the independent registered public accounting firm and any other independent registered public accounting firm engaged by us;

pre-approving all audit and

non-audit services to be provided by the independent registered public accounting firm or any other registered public accounting firm engaged by us, and establishing

pre-approval policies and procedures;

reviewing and discussing with the independent registered public accounting firm all relationships the auditors have with us in order to evaluate their continued

independence;

setting clear policies for audit partner rotation in compliance with applicable laws and regulations;

and reviewing a report, at least annually, from the independent registered public accounting firm describing (1) the independent registered public accounting firm internal quality-control procedures and (2) any material issues raised by

the most recent internal quality-control review, or peer review, of the audit firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years respecting one or more independent audits carried out

by the firm and any steps taken to deal with such issues;

meeting to review and discuss our annual audited financial statements and quarterly financial statements with

management and the independent registered public accounting firm, including reviewing our specific disclosures under Managements Discussion and Analysis of Financial Condition and Results of Operations;

reviewing and approving any

related party transaction required to be disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC prior to us entering into such transaction;

reviewing with management, the independent registered public accounting firm, and our legal advisors, as

appropriate, any legal, regulatory or compliance matters, including any correspondence with regulators or government agencies and any employee complaints or published reports that raise material issues regarding our financial statements or

accounting policies and any significant changes in accounting standards or rules promulgated by the Financial Accounting Standards Board, the SEC or other regulatory authorities.

Compensation Committee

We have established a

compensation committee of the board of directors.

Anderson, Ms.

Luthi and Mr.

Wert serve as members of our compensation committee.

Under the NYSE listing standards and applicable SEC rules, we are required to have at least two

members of the compensation committee, all of whom must be independent.

Anderson, Ms.

Luthi and Mr.

Wert are independent and Mr.

Wert chairs the compensation committee.

We have adopted a compensation committee charter, which details the principal functions of the compensation committee, including:

reviewing and approving on an annual basis the corporate goals and objectives relevant to our chief executive

officers compensation, evaluating our chief executive officers performance in light of such goals and objectives and determining and approving the remuneration (if any) of our chief executive officer based on such evaluation;

reviewing and making recommendations to our board of directors with respect to the compensation, and any

incentive compensation and equity based plans that are subject to board approval of all of our other officers;

reviewing our executive compensation policies and plans;

implementing and administering our incentive compensation equity-based remuneration plans;

assisting management in complying with our proxy statement and annual report disclosure requirements;

approving all special perquisites, special cash payments and other special compensation and benefit arrangements

for our officers and employees;

producing a report on executive compensation to be included in our annual proxy statement;

reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors.

Notwithstanding the foregoing, as indicated above, other than the payment to an affiliate of the Sponsor of $10,000 per month, until

November 17, 2022, for office space, utilities and secretarial and administrative support and reimbursement of expenses, no compensation of any kind, including finders, consulting or other similar fees, will be paid to any of our existing

stockholders, officers, directors or any of their respective affiliates, prior to, or for any services they render in order to effectuate the consummation of an initial business combination.

Accordingly, it is likely that prior to the consummation

of an initial business combination, the compensation committee will only be responsible for the review and recommendation of any compensation arrangements to be entered into in connection with such initial business combination.

The charter also provides that the compensation committee may, in its sole discretion, retain or obtain the advice of a compensation consultant, legal counsel

or other adviser and will be directly responsible for the appointment, compensation and oversight of the work of any such adviser.

However, before engaging or receiving advice from a compensation consultant, external legal counsel or any other

adviser, the compensation committee will consider the independence of each such adviser, including the factors required by the NYSE and the SEC.

Nominating and Corporate Governance Committee

have established a nominating and corporate governance committee of the board of directors.

The members of our nominating and corporate governance are Ms.

Anderson, Ms.

Luthi and Mr.

Wert, and Ms.

Anderson serves as chair of the

nominating and corporate governance committee.

We have adopted a nominating and corporate governance committee charter, which details the principal

functions of the nominating and corporate governance committee, including:

identifying, screening and reviewing individuals qualified to serve as directors, consistent with criteria

approved by the board, and recommending to the board of directors candidates for nomination for election at the annual meeting of stockholders or to fill vacancies on the board of directors;

developing and recommending to the board of directors and overseeing implementation of our corporate governance

coordinating and overseeing the annual self-evaluation of the board of directors, its committees, individual

directors and management in the governance of the company;

reviewing on a regular basis our overall corporate governance and recommending improvements as and when

The charter also provides that the nominating and corporate governance committee may, in its sole

discretion, retain or obtain the advice of, and terminate, any search firm to be used to identify director candidates, and will be directly responsible for approving the search firms fees and other retention terms.

We have not formally established any specific, minimum qualifications that must be met or skills that are necessary for directors to possess.

In general, in

identifying and evaluating nominees for director, the board of directors considers educational background, diversity of professional experience, knowledge of our business, integrity, professional reputation, independence, wisdom, and the ability to

represent the best interests of our stockholders.

Prior to our initial business combination, holders of our public shares will not have the right to recommend director candidates for nomination to our board of directors.

Compensation Committee Interlocks and Insider Participation

None of our officers currently serves, or in the past year has served, as a member of the compensation committee of any entity that has one or more officers

serving on our board of directors.

The audit committee consists of Messrs.

Blake Byers, Niccolo de Masi, Inder Singh and Harry You, each of whom our board of directors has determined satisfies the independence requirements under NYSE listing standards and Rule 10A-3(b)(1) of

the Exchange Act.

The chair of the audit committee is Mr.

Our board has determined that Mr.

You is an “audit committee financial expert” within the meaning of SEC regulations.

Each member of the audit committee can read and understand fundamental financial statements in accordance with applicable requirements.

In arriving at these determinations, our board has examined each audit committee member’s scope of experience and the nature of their employment.

The primary purpose of the audit committee is to discharge the responsibilities of the board of directors with respect to the corporate accounting and financial reporting processes, systems of internal control and financial statement audits, and to oversee the independent registered public accounting firm.

Specific responsibilities of the audit committee include:

helping the board of directors oversee corporate accounting and financial reporting processes;

managing the selection, engagement, qualifications, independence and performance of a qualified firm to serve as the independent registered public accounting firm to audit the financial statements;

discussing the scope and results of the audit with the independent registered public accounting firm, and reviewing, with management and the independent accountants, the interim and year-end operating

developing procedures for employees to submit concerns anonymously about questionable accounting or audit matters;

reviewing related person transactions;

obtaining and reviewing a report by the independent registered public accounting firm at least annually that describes internal quality control procedures, any material issues with such procedures and any steps taken to deal with such issues when required by applicable law;

approving or, as permitted, pre-approving, audit

and permissible non-audit services

to be performed by the independent registered public accounting firm.

Code of Business Conduct and Ethics

We have adopted a Code of Business Conduct Ethics that applies to all of our directors, executive officers and employees that complies with the rules and

regulations of the NYSE.

The Code of Business Conduct Ethics codifies the business and ethical principles that govern all aspects of our business.

We have previously filed copies of our form of Code of Business Conduct Ethics, our form of Audit

Committee Charter, our form of Compensation Committee Charter and our form of Nominating and Corporate Governance Committee Charter as exhibits to our registration statement in connection with our initial public offering.

You may review these

documents by accessing our public filings at the SECs web site at www.sec.gov.

In addition, a copy of the Code of Ethics will be provided without charge upon request to us in writing at 1180 North Town Center Drive, Suite 100, Las Vegas,

Nevada 89144 or by telephone at (702) 781-4313.

Conflicts of Interest

Members of our management team do not have any obligation to present us with any opportunity for a potential business combination of which they become aware,

unless presented to such member solely in his or her capacity as a director or officer of the company.

Our amended and restated certificate of incorporation provides that we renounce our interest in any corporate opportunity offered to any director

or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be

reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation.

Potential investors should be aware of the following potential conflicts of interest:

None of our officers or directors is required to commit his or her full time to our affairs and, accordingly, may

have conflicts of interest in allocating his or her time among various business activities.

In the course of their other business activities, our officers and directors may become aware of investment and

business opportunities which may be appropriate for presentation to us as well as the other entities with which they are affiliated.

Our management may have conflicts of interest in determining to which entity a particular business opportunity

should be presented.

Our initial stockholders have agreed to waive their redemption rights with respect to any founder shares and

private placement shares and any public shares held by them in connection with the consummation of our initial business combination.

Additionally, our initial stockholders have agreed to waive their redemption rights with respect to any founder

shares or private placement shares held by them if we fail to consummate our initial business combination by November 17, 2022.

If we do not complete our initial business combination within such applicable time period, the proceeds of the sale

of the private placement warrants held in the trust account will be used to fund the redemption of our public shares, and the private placement warrants (and the underlying securities) will expire worthless.

With certain limited exceptions, the

founder shares will not be transferable, assignable by the Sponsor until the earlier of:

(A) one year after the completion of our initial business combination or (B) subsequent to our initial business combination, (x) if the last sale

price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any

30-trading day period commencing at least 150 days after our initial business combination, or (y) the date on which we complete a liquidation, merger, capital stock exchange, reorganization or other

similar transaction that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property.

With certain limited exceptions, the private placement warrants, private placement shares

and private placement warrants and the Class A common stock underlying such warrants, will not be transferable, assignable or saleable by the Sponsor or its permitted transferees until 30 days after the completion of our initial business

Since the Sponsor and officers and directors may directly or indirectly own common stock and warrants following our initial public offering, our officers and directors may have a conflict of interest in determining whether a particular

target business is an appropriate business with which to effectuate our initial business combination.

Our officers and directors may have a conflict of interest with respect to evaluating a particular business

combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination.

The Sponsor, our officers or directors may have a conflict of interest with respect to evaluating a business

combination and financing arrangements as we may obtain loans from the Sponsor or an affiliate of the Sponsor or any of our officers or directors to finance transaction costs in connection with an intended initial business combination.

$1,500,000 of such working capital loans may be convertible into private placement-equivalent warrants at a price of $2.00 per warrant at the option of the lender.

Such units would be identical to the private placement warrants, including as to

exercise price, exercisability and exercise period.

The conflicts described above may not be resolved in our favor.

In general, officers and directors of a corporation incorporated under the laws of the State of Delaware are required to present business opportunities to a

corporation if:

the corporation could financially undertake the opportunity;

the opportunity is within the corporations line of business;

it would not be fair to our company and its stockholders for the opportunity not to be brought to the attention

of the corporation.

Accordingly, as a result of multiple business affiliations, our officers and directors may have similar legal

obligations relating to presenting business opportunities meeting the above-listed criteria to multiple entities.

Furthermore, our amended and restated certificate of incorporation provides that we renounce our interest in any corporate opportunity

offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake

and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation.

Below is a table summarizing the entities to which our executive officers and directors currently have

fiduciary duties or contractual obligations:

Entitys Business

We have adopted a Code of Business Conduct and Ethics, or the Code of Conduct, applicable to all of our employees, executive officers and directors.

The Code of Conduct is available at the investors section of our website at www.ionq.com.

Any amendments to the Code of Conduct, or any waivers of its requirements, are expected to be disclosed on our website to the extent required by applicable rules and exchange requirements.

The reference to our website address does not constitute incorporation by reference of the information contained at or available through our website, and you should not consider it to be a part of this Annual Report.

Delinquent Section 16(a) Reports

Section 16(a) of the Exchange Act requires our directors, certain officers, including our executive officers, and persons who own more than 10% of our common stock to report to the SEC their initial ownership of our common stock and any subsequent changes in that ownership.

The SEC has established specific due dates for these reports and we are required to disclose in in this Annual Report any late filings or failures to file.

Based solely on our review of such reports filed electronically with the SEC and written representations from reporting persons that no other reports were required during the fiscal year ended December 31, 2021, we believe that all of our directors and officers complied with all Section 16(a) filing requirements applicable to them.

Executive Compensation.

Executive Compensation

Summary Compensation Table

The following table sets forth information for each of the last two completed fiscal years regarding compensation awarded to or earned by our Chief Executive Officer, our former Chief Executive Officer and the two other most highly compensated executive officers (the “named executive officers”) during the fiscal years indicated:

Name and Principal Position

Option Awards

Peter Chapman

President and Chief Executive Officer

Chief Technology Officer

Thomas Kramer (3)

Chief Financial Officer

Niccolo de Masi (4)

Rush Street Interactive, Inc.

dMY Technology Group, Inc.

Glu Mobile, Inc.

Online gaming company

Special purpose acquisition company

Mobile gaming company

Chief Executive Officer and Director

Rush Street Interactive, Inc.

dMY Technology Group, Inc.

GTY Technology Holdings, Inc.

Broadcom Inc.

Coupang, Inc.

Online gaming company

Special purpose acquisition company

Software as a service company

Semiconductor manufacturing company

Vice Chairman

Former Chief Executive Officer

The amounts in this column reflect the aggregate grant date fair value of the shares underlying option awards granted in the applicable year, computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718 for stock-based compensation transactions.

The assumptions we used in valuing these awards are described in Note 13 to our consolidated financial statements included elsewhere in this Annual Report.

These amounts do not reflect the actual economic value that will be realized by the named executive officer upon the vesting of the stock options, the exercise of the stock options, or the sale of the common stock underlying such stock options.

Amounts in this column represent 401(k) matching contribution for Mr.

Chapman and Mr.

Kramer began employment with us on February 15, 2021.

de Masi resigned as the chief executive officer upon closing of the business combination.

Amount represents annual fees paid to Mr.

de Masi for his service on our board of directors.

Outstanding Equity Awards as of December 31, 2021

The following table presents information regarding outstanding option and stock awards held by the named executive officers as of December 31, 2021.

All awards were granted pursuant to the 2015 Plan.

Option Awards (5)

Stock Awards (5)

(#) exercisable

unexercisable

Peter Chapman

Thomas Kramer

Niccolo de Masi

10% of the shares of common stock underlying the option vested on the six month anniversary of the vesting commencement date and 1/54 th

of the remaining shares shall vest on the last day of each month thereafter, subject to the holder remaining in continuous service with the Company on each vesting date.

The shares of common stock underlying the option vested or shall vest 1/54 th

on the last day of each month commencing on the Vesting Commencement Date, subject to the holder remaining in Continuous Service with the Company on each vesting date.

Consists of shares of restricted stock issued pursuant to the early exercise of Mr.

Kramer’s option award granted in February 2021 and that remain subject to our repurchase right in accordance with the vesting schedule of the option.

The market value of unvested shares is calculated by multiplying the number of unvested shares by the closing market price of our common stock on NYSE on December 31, 2021, the last trading day of the year, which was $16.70 per share.

If a named executive officer experiences a covered termination during a change in control period, any then outstanding unvested shares of common stock subject to this option will become fully vested and exercisable.

See the section below titled “—Change in Control Severance Plan” below for additional information.

Employment Arrangements

Each of the named executive officers is an at-will

employee with certain rights to advance notice prior to termination as provided under the Change in Control Severance Plan.

Each named executive officer is eligible to participate in the IonQ, Inc.

Change in Control Severance Plan under the terms and conditions of such plan, see the section below titled “—Change in Control Severance Plan” below for additional information.

Peter Chapman

In September 2021, we entered into an amended and restated offer letter agreement with Mr.

Chapman which governs the current terms of his employment as our Chief Executive Officer.

Chapman’s current annual base salary for 2021 was $350,000.

Chapman is eligible to participate in any bonus plan that may be established for executive officers and is also eligible for reimbursement of business expenses and to participate in our standard employee benefit plans and programs.

In September 2021, we entered into an amended and restated offer letter agreement with Dr.

Kim that established an employment relationship and governs the current terms of his employment as our Chief Technology Officer.

Kim’s annual base salary for 2021 was $280,000.

Kim is also eligible for reimbursement of business expenses.

Kim was granted an option to purchase 404,845 shares of common stock in March 2021, with an exercise price of $2.39 per share.

Thomas Kramer

In September 2021, we entered into an amended and restated offer letter agreement with Mr.

Kramer which governs the current terms of his employment as our Chief Financial Officer.

Kramer’s current annual base salary for 2021 was $200,000.

Kramer is eligible to participate in any bonus plan that may be established for executive officers and is also eligible for reimbursement of business expenses and to participate in our standard employee benefit plans and programs.

In connection with commencement of his employment in 2021, Mr.

Kramer was granted an option to purchase 2,701,844 shares of common stock with an exercise price of $2.39 per share.

Change in Control Severance Plan

Upon the closing of the business combination, each of the executive officers, including the named executive officers, became eligible to receive severance benefits under the terms of the IonQ, Inc.

Change in Control Severance Plan.

The Change in Control Severance Plan provides for severance benefits upon a “covered termination” that occurs outside of or during a “change in control period” (each as described below).

Upon a covered termination that occurs outside of a change in control period, the “change in control period,” participants will be entitled to (1) a payment equal to the participant’s base salary for a period of months (12 months for Mr.

6 months for Dr.

Kramer) less applicable tax withholdings to be paid in equal installments on our regular payroll schedule or in a lump sum, as we determine, and in compliance with Section 409A of the Code, and (2) payment of continued group health benefits for a period of time matching the applicable severance term.

Upon a covered termination that occurs during a change in control period, participants will be entitled to (1) a payment equal to the participant’s base salary for a period of months (12 months for Mr.

Kramer) less applicable tax withholdings to be paid in equal installments on the Company’s regular payroll schedule or in a lump sum, as we determine, and in compliance with Section 409A of the Code;

(2) a payment equal to a multiple of the participant’s target annual bonus (100% for Mr.

Kramer) less applicable tax withholdings to be paid in equal installments on our regular payroll schedule or in a lump sum, as we determine, and in compliance with Section 409A of the Code;

(3) payment of continued group health benefits and full accelerated vesting of all outstanding equity awards subject to time-based vesting.

All severance benefits under the Change in Control Severance Plan are subject to the participant’s execution of an effective release of claims in favor of us and compliance with the terms of any confidential information agreement, proprietary information and inventions agreement and any other agreement between the participant and IonQ.

For purposes of the Change in Control Severance Plan, a “covered termination” is a termination of employment by IonQ without “cause,” as defined in the Change in Control Severance Plan, or as a result of the participant’s resignation for “good reason,” as defined in the Change in Control Severance Plan, in either case, not as a result of death or disability.

For purposes of the Change in Control Severance Plan, a “change in control period” is the period of time beginning on the date on which a “change in control,” as defined in our 2021 Equity Incentive Plan (“2021 Plan”), becomes effective and ending on the first anniversary of the effective date of such change in control.

Health and Welfare Benefits;

Our named executive officers are eligible to participate in our employee benefit plans, including medical, dental, vision, disability and life insurance plans, in each case on the same basis as all of our other full-time employees.

Part-time employees, including Dr.

Kim, are not eligible to participate in our employee benefit plans.

We generally do not provide perquisites or personal benefits to our named executive officers, except in limited circumstances, and we did not provide any perquisites or personal benefits to our named executive officers in 2021.

Our named executive officers (other than Dr.

Kim) are eligible to participate in a defined contribution retirement plan that provides eligible U.S.

employees with an opportunity to save for retirement on a tax advantaged basis.

Eligible employees may defer eligible compensation on a pre-tax

(Roth) basis, up to the statutorily prescribed annual limits on contributions under the Code.

Contributions are allocated to each participant’s individual account and are then invested in selected investment alternatives according to the participants’ directions.

We currently make matching contributions into the 401(k) plan on behalf of participants equal to 100% on participant contributions up to 5% of their compensation.

Participants are always vested in their contributions to the plan.

Participants vest in their company matching and nonelective contributions under a one to five-year graded vesting schedule.

The 401(k) plan is intended to be qualified under Section 401(a) of the Code with the 401(k) plan’s related trust intended to be tax exempt under Section 501(a) of the Code.

As a tax-qualified

retirement plan, contributions to the 401(k) plan (except for Roth contributions) and earnings on those contributions are not taxable to the employees until distributed from the 401(k) plan.

Director Compensation

Cash Compensation

We maintain a non-employee

director compensation policy, pursuant to which the non-executive

chair receives an annual base retainer of $50,000, and each other non-employee

director receives an annual base retainer of $30,000.

In addition, our non-employee

directors receive the following cash compensation for committee services, as applicable:

each chair of our audit, compensation and nominating and corporate governance committees receives an additional annual retainer of $20,000, $12,000 and $8,000, respectively;

each other member of our audit, compensation and nominating and corporate governance committees receives an additional annual retainer of $8,000, $6,000 and $4,000, respectively.

These retainers are payable in arrears in four equal quarterly installments on the last day of each quarter, provided that the amount of such payment will be prorated for any portion of such quarter that the director is not serving on the Board or the applicable committee.

We also reimburse each of our directors for their travel expenses incurred in connection with their attendance at Board and committee meetings.

Equity Compensation

Initial Grant

For each newly appointed or elected director, an initial grant of restricted stock units (“RSU Award”) and option to purchase shares of common stock (“Stock Option Award”) with an aggregate fair market value as of the grant date equal to $400,000, with such value split equally between the RSU Award and Stock Option Award.

The Initial Grant will vest over a three-year period, with one-third

of the Initial Grant vesting on each anniversary of the grant date, such that the Initial Grant is fully vested on the third anniversary of the date of grant, subject to continuous service as a member of the Board through such vesting date.

On the first business day following each annual stockholder meeting (“Annual Meeting”), each director who continues to serve as a non-employee

member of the Board following such Annual Meeting (excluding any Eligible Director who is first appointed or elected by the Board at the Annual Meeting) will be granted an RSU Award and an Stock Option Award with an aggregate fair market value as of the grant date equal to $200,000, with such value split equally between the RSU Award and Stock Option Award.

The Annual Grant will vest in full on the earlier of (i) the date of the following year’s Annual Meeting (or the date immediately prior to the next Annual Meeting if the non-employee

director’s service as a director ends at such Annual Meeting due to the director’s failure to be re-elected

or the director not standing for re-election),

or (ii) the one-year

anniversary measured from the date of grant, subject in all cases to continued service as a member of the Board through such vesting date.

With respect to a director who is first elected or appointed to the Board on a date other than the date of the Annual Meeting, upon the first Annual Meeting following such director’s first joining the Board, such director’s first Annual Grant will be pro-rated

to reflect the time between such director’s election or appointment date and the date of such first Annual Meeting.

Vesting Acceleration

In the event of a change of control (as defined in our 2021 Plan), any unvested portion of an equity award granted to our non-employee

directors will fully vest and, if applicable, become exercisable immediately prior to the effective date of such change of control, subject to the non-employee

director’s continuous service with us on the effective date of the change of control.

Election to Receive Equity in Lieu of Cash Compensation

Each non-employee director may elect to receive fully vested RSU Awards in lieu of his or her cash compensation.

Such RSU Awards are issued on a quarterly basis, in arrears, and the number of such restricted stock units is calculated by dividing (1) the aggregate amount of cash compensation otherwise payable to such director divided by (2) the closing sales price per share of our common stock on the last day of the fiscal quarter in which the service occurred, rounded down to the nearest whole share.

Notwithstanding the foregoing, any member of our board of directors that is entitled to the above compensation may elect to forego all or a portion of such compensation from time to time by giving notice to the General Counsel of the Company.

Director Compensation Table

The following table sets forth information regarding the compensation earned for service on the Board by our non-employee

directors during the year ended December 31, 2021.

As a named executive officer, the compensation received by Mr.

de Masi is shown above in “—Executive Compensation—Summary Compensation Table.”

Fees Earned or

Awards (1)(5)

Darla Anderson (3)

dMY Technology Group, Inc.

Glu Mobile, Inc.

Special purpose acquisition company

Mobile gaming company

Craig Barratt

Ronald Bernal

Francesca Luthi (3)

dMY Technology Group, Inc.

Special purpose acquisition company

Insurance company

Executive Vice President and Chief Administrative Officer

dMY Technology Group, Inc.

GTY Technology Holdings, Inc.

Special purpose acquisition company

Software as a service company

Director and Chairman of Audit Committee

Accordingly, if any of the above executive officers or directors becomes aware of a business combination

opportunity which is suitable for any of the above entities to which he or she has current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to

such entity, and only present it to us if such entity rejects the opportunity.

We are not prohibited from pursuing an initial business combination with a

company that is affiliated with the Sponsor, our officers or directors.

In the event we seek to complete our initial business combination with such a company, we, or a committee of independent directors, would obtain an opinion from an independent

investment banking firm which is a member of FINRA, or from an independent accounting firm, that such an initial business combination is fair to our company from a financial point of view.

We are not required to obtain such an opinion in any other

In the event that we submit our initial business combination to our public stockholders for a vote, pursuant to the letter agreement, the

Sponsor, our officers and directors have agreed to vote any founder shares or private placement shares held by them and any public shares purchased during or after the offering (including in open market and privately negotiated transactions) in

favor of our initial business combination.

Limitation on Liability and Indemnification of Officers and Directors

Our amended and restated certificate of incorporation provides that our officers and directors will be indemnified by us to the fullest extent authorized by

Delaware law, as it now exists or may in the future be amended.

In addition, our amended and restated certificate of incorporation provides that our directors will not be personally liable for monetary damages to us or our stockholders for breaches

of their fiduciary duty as directors, unless they violated their duty of loyalty to us or our stockholders, acted in bad faith, knowingly or intentionally violated the law, authorized unlawful payments of dividends, unlawful stock purchases or

unlawful redemptions, or derived an improper personal benefit from their actions as directors.

We will enter into agreements with our officers and

directors to provide contractual indemnification in addition to the indemnification provided for in our amended and restated certificate of incorporation.

Our bylaws also will permit us to secure insurance on behalf of any officer, director or

employee for any liability arising out of his or her actions, regardless of whether Delaware law would permit such indemnification.

We will purchase a policy of directors and officers liability insurance that insures our officers and

directors against the cost of defense, settlement or payment of a judgment in some circumstances and insures us against our obligations to indemnify our officers and directors.

These provisions may discourage stockholders from bringing a lawsuit against our directors for breach of their fiduciary duty.

These provisions also may have

the effect of reducing the likelihood of derivative litigation against officers and directors, even though such an action, if successful, might otherwise benefit us and our stockholders.

Furthermore, a stockholders investment may be adversely

affected to the extent we pay the costs of settlement and damage awards against officers and directors pursuant to these indemnification provisions.

believe that these provisions, the directors and officers liability insurance and the indemnity agreements are necessary to attract and retain talented and experienced officers and directors.

Executive Compensation.

None of our executive officers or directors has received any cash compensation for services rendered.

We will reimburse an affiliate of the Sponsor for office

space, secretarial and administrative services provided to members of our management team in an amount not to exceed $10,000 per month in the event such space and/or services are utilized and we do not pay directly for such services.

Upon completion

of our initial business combination or our liquidation, we will cease making these payments.

In addition, the Sponsor, executive officers and directors, or any of their respective affiliates will be reimbursed for any

out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable

business combinations.

Our audit committee will review on a quarterly basis all payments that were made to the Sponsor, our officers or directors, or our or their affiliates.

Other than these payments and reimbursements, no compensation of any kind,

including finders and consulting fees, will be paid to the Sponsor, executive officers and directors, or any of their respective affiliates, prior to completion of our initial business combination.

We do not intend to take any action to ensure that members of our management team maintain their positions

with us after the consummation of our initial business combination, although it is possible that some or all of our officers and directors may negotiate employment or consulting arrangements with the post-transaction company after our initial

business combination.

Any such arrangements will be disclosed in the proxy solicitation or tender offer materials, as applicable, furnished to our shareholders in connection with a proposed business combination, to the extent they are known at such

The existence or terms of any such employment or consulting arrangements may influence our managements motivation in identifying or selecting

a target business, but we do not believe that such arrangements will be a determining factor in our decision to proceed with any potential business combination.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

The following table sets forth information regarding the beneficial ownership of our common stock as of March 23, 2021 by:

each person known by us to be the beneficial owner of more than 5% of our outstanding shares of common stock;

each of our executive officers and directors;

all our executive officers and directors as a group.

Unless otherwise indicated, we believe that all persons named in the table have sole voting and investment power with respect to all shares of common stock

beneficially owned by them.

The following table does not reflect record or beneficial ownership of the private placement warrants as these warrants are not exercisable within 60 days of the date of this Form

The beneficial ownership of our common stock is based on 37,500,000 shares of common stock issued and

outstanding as of March 23, 2021, consisting of 30,000,000 shares of Class A common stock and 7,500,000 shares of Class B common stock.

NAME AND ADDRESS OF BENEFICIAL OWNER (1)

Directors, Executive Officers and Founders

Niccolo de Masi (3)

The amounts reported in this column reflect the aggregate grant date fair value of the shares underlying option awards granted to our directors as computed in accordance with ASC Topic 718.

See Note 13 to our consolidated financial statements included elsewhere in this Annual Report for a discussion of assumptions made us in determining the aggregate grant date fair value of our option awards.

Note that the amounts reported in this column reflect the accounting cost for these stock options and do not reflect the actual economic value that may be realized by the directors upon the vesting of the stock options, the exercise of the stock options or the sale of the common stock underlying such stock options.

In connection with Mr.

Barratt’s appointment to Legacy IonQ, he was granted a stock option to purchase 926,347 shares of our common stock.

The shares of common stock underlying the option vested or shall vest 1/36 th

on the last day of each month commencing on December 30, 2020, subject to the holder remaining in Continuous Service with the Company on each vesting date.

The option contains an early exercisable provision and was fully exercised by Mr.

Resigned from our board of directors upon completion of the business combination on September 30, 2021.

In January 2022, Mr.

Singh received a Stock Option Award of 33,570 shares of our common stock and an RSU Award of 11,190 shares of our common stock in connection with his appointment to our board of directors in December 2021.

The following table provides information regarding the aggregate number of equity awards granted to our non-employee

directors that were outstanding as of December 31, 2021:

Restricted Stock

Outstanding at

Option Awards

Outstanding at

Darla Anderson

Craig Barratt

Ronald Bernal

Francesca Luthi

All executive officers and directors as a group (five individuals)

Consists of shares of restricted stock issued pursuant to the early exercise of the stock option granted to Mr.

Barratt in connection with this appointment to Legacy IonQ that remain subject to our repurchase right in accordance with the vesting schedule of the stock option.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

Security Ownership of Certain Beneficial Owners and Management

The following table sets forth information regarding the beneficial ownership of shares of our common stock as of March 15, 2022 by (i) each named executive officer, (ii) each director, (iii) all directors and executive officers as a group and (iv) each person, or group of affiliated persons, who is known by us to beneficially own more than 5% of our outstanding common stock.

Other than as set forth in this table, we are not aware of any person or group that holds greater than 5% of our outstanding common stock.

Beneficial ownership of securities is determined according to the rules of the SEC and generally means, with respect to a security, that a person or entity possesses sole or shared voting or investment power of such security, including options and warrants that are currently exercisable or will be exercisable within 60 days of March 15, 2022.

Options to purchase shares of our common stock that are exercisable within 60 days of March 15, 2022 are deemed to be beneficially owned by the person holding these options for the purpose of computing percentage ownership of that person, but they are not treated as outstanding for the purpose of computing any other person’s ownership percentage.

This table is based upon information supplied by officers, directors and principal stockholders and Schedules 13G or 13D filed with the SEC.

Unless otherwise indicated in the footnotes to this table and subject to community property laws where applicable, we believe that all persons named in the table have sole voting and investment power with respect to all shares of our common stock beneficially owned by them.

Applicable percentages are based on 197,671,494 shares of common stock outstanding as of December 31, 2021, adjusted as required by rules promulgated by the SEC.

Name and Address of Beneficial Owner (1)

Five Percent Holders

dMY Sponsor III, LLC (2)(3)

Certain funds managed by BlueCrest Capital Management Limited (4)

Polar Asset Management Partners

Unless otherwise noted, the business address of each of the entities or individuals listed is 1180 North Town

Center Drive, Suite 100 Las Vegas, Nevada 89144.

Does not include 4,000,000 shares of Class A Common Stock underlying private placement warrants that may

not become exercisable within 60 days of the date hereof.

dMY Sponsor III, LLC is the record holder of the shares of common stock reported herein.

Each of dMYs

current officers and directors are among the members of the Sponsor, and Mr.

Amount & Nature of

Percent of Class

(Common Stock)

5% Stockholders:

Entities affiliated with New Enterprise Associates (2)

Entities affiliated with GV (3)

Named Executive Officers and Directors:

Peter Chapman (4)

Jungsang Kim (5)

Thomas Kramer (6)

Craig Barratt (7)

Ronald Bernal (2)

Niccolo de Masi (8)

All executive officers and directors as a group (11 persons)

Less than 1%.

Unless otherwise noted, the business address of each of the beneficial owners is c/o IonQ, Inc., 4505 Campus Drive, College Park, MD 20740.

Consists of (i) 29,229,659 shares of common stock held by New Enterprise Associates 15, L.P.

(“NEA 15”) and (ii) 48,193 shares of common stock held by NEA Ventures 2016, L.P (“NEA Ventures”).

The shares directly held by NEA 15 are indirectly held by NEA Partners 15, L.P.

(“NEA Partners 15”), the sole general partner of NEA 15, NEA 15 GP, LLC (“NEA 15 LLC”), the sole general partner of NEA Partners 15 and each of the individual managers of NEA 15 LLC.

The individual Managers of NEA 15 LLC (collectively, the “Managers”) are Forest Baskett, Anthony A.

Florence, Mohamad Makhzoumi, Peter Sonsini and

The shares directly held by NEA Ventures are indirectly held by Karen P.

Welsh, the general partner of NEA Ventures.

NEA Partners 15, NEA 15 LLC and the Managers share voting and dispositive power with regard to the securities directly held by NEA 15.

Welsh has voting and dispositive power with regard to the securities directly held by NEA Ventures.

Ron Bernal, a member of our board of directors, and a Venture Partner at New Enterprise Associates, Inc.

(“NEA”), has no voting or investment control over any of the shares held by NEA 15 and NEA Ventures.

All indirect holders of the above referenced securities disclaim beneficial ownership therein except to the extent of their actual pecuniary interest.

Consists of (i) 4,556,532 shares of common stock held by GV 2019, L.P.

and (ii) 17,350,506 shares of common stock held by GV 2016, L.P.

GV 2019 GP, L.P.

(the general partner of GV 2019, L.P.), GV 2019 GP, L.L.C., (the general partner of GV 2019 GP, L.P.), Alphabet Holdings LLC (the managing member of GV 2019 GP, L.L.C.), XXVI Holdings Inc.

(the managing member of Alphabet Holdings LLC) and Alphabet Inc.

(the controlling stockholder of XXVI Holdings Inc.) may each be deemed to have sole voting and investment power over the securities held by GV 2019, L.P.

GV 2016 GP, L.P.

(the general partner of GV 2016, L.P.), GV 2016 GP, L.L.C.

(the general partner of GV 2016 GP, L.P.), Alphabet Holdings LLC (the managing member of GV 2016 GP, L.L.C.), XXVI Holdings Inc.

(the managing member of Alphabet Holdings LLC) and Alphabet Inc.

(the controlling stockholder of XXVI Holdings Inc.) may each be deemed to have sole voting and investment power over the securities held by GV 2016, L.P.

The principal business address of GV 2019, L.P., GV 2019 GP, L.P., GV 2019 GP, L.L.C., GV 2016, L.P., GV 2016 GP, L.P., GV 2016 GP, L.L.C., Alphabet Holdings LLC, XXVI Holdings Inc.

and Alphabet Inc.

is 1600 Amphitheatre Parkway, Mountain View, California 94043.

Reflects shares of common stock issuable to Mr.

Chapman pursuant to options exercisable within 60 days of March 15, 2022.

Consists of (i) 6,422,352 shares of common stock held by Mr.

Kim, (ii) 391,347 shares of common stock issuable to Mr.

Kim pursuant to options exercisable within 60 days of March 15, 2022, and (iii) 809,691 shares of common stock held by the Jungsang Kim Irrevocable Trusts For Children, dated January 27, 2021.

Consists of 675,464 shares of common stock held by Mr.

Kramer, a portion of which are subject to a repurchase right.

Consists of 926,347 shares of common stock held by the Barratt-Oakley Trust dated November 29, 2004, of which Mr.

Barratt is a trustee.

A portion of these shares are subject to a repurchase right.

Consists of 7,425,000 shares of common stock held by dMY Sponsor III, LLC (the “Sponsor”).

de Masi are members of the Sponsor, and Mr.

You is the manager of the Sponsor.

You has voting and dispositive power with respect to the common stock held of record by the Sponsor.

Each of dMYs

current officers and directors other than Mr.

You disclaims any beneficial ownership of any shares held by the Sponsor.

According to a Schedule 13G filed with the SEC on November 13, 2020, on behalf of BlueCrest Capital

Management Limited (the Investment Manager), which serves as an investment manager to Millais Limited (the Fund), and Michael Platt, who serves as principal, director, and control person of the Investment Manager, each of

which may be deemed the beneficial owner wwith respect to certain of the reported shares shown above.

Millais USA LLC acts as sub-investment manager of the Fund.

The business address of this stockholder is

Ground Floor, Harbour Reach, La Rue de Carteret, St Helier, Jersey, Channel Islands, JE2 4HR.

According to a Schedule 13G filed with the SEC on February 8, 2021, on behalf of Polar Asset Management

Partners Inc (Polar).

The business address of Polar is 401 Bay Street, Suite 1900, PO Box 19, Toronto, Ontario M5H 2Y4, Canada.

Accordingly, Mr.

You has voting and investment discretion with respect to the common stock held of record by the Sponsor.

di Masi has no voting or investment control over any of the shares and disclaims any beneficial ownership of any securities held by the Sponsor.

Securities Authorized for Issuance Under Equity Compensation Plans

The following table sets forth the aggregate information of our equity compensation plans in effect as of December 31, 2021.

Plan Category

Number of securities

to be issued upon

options, warrants and

Weighted-average

exercise price of

outstanding options,

warrants and rights

Number of securities

remaining available

future issuance under

equity compensation

plans (excluding

securities reflected in

Equity compensation plans approved by stockholders:

2015 Equity Incentive Plan (1)

2021 Equity Incentive Plan

2021 Employee Stock Purchase Plan

Equity compensation plans not approved by stockholders

Following the adoption of the 2021 Plan, no additional equity awards have been or will be granted under the 2015 Plan.

The number of shares of common stock reserved for issuance under the 2021 Plan will automatically increase on January 1 of each year, beginning on January 1, 2022 and continuing through and including January 1, 2031, in an amount equal to (1) 5% of the fully-diluted common stock on December 31 of the preceding year (as defined in the 2021 Plan), or (2) a lesser number of shares of common stock determined by the board of directors prior to the date of the increase (which may be zero).

Pursuant to the terms of the 2021 Plan, the number of shares available under the 2021 Plan was increased by 12,947,703 shares effective January 1, 2022.

The number of shares of common stock reserved for issuance under the ESPP will automatically increase on January 1 of each year, beginning on January 1, 2022 and continuing through and including January 1, 2031, by the lesser of (1) 1% of the fully-diluted common stock on December 31 of the preceding calendar year (inclusive of the share reserve for the ESPP and of the 2021 Plan), (2) a number of shares equal to two times the initial share reserve, or (3) such lesser number of shares of common stock as determined by the board (which may be zero).

Pursuant to the terms of the ESPP, no shares were added to the reserve on January 1, 2022.

Certain Relationships and Related Transactions, and Director Independence.

Policies and Procedures Regarding Transactions with Related Persons

We have adopted a written related person transactions policy that sets forth our policies and procedures regarding the identification, review, consideration and oversight of “related person transactions.” For purposes of the policy only, a “related person transaction” is a transaction, arrangement or relationship (or any series of similar transactions, arrangements or relationships) in which we or any of our subsidiaries are participants involving an amount that exceeds $120,000, in which any “related person” has a material interest.

Transactions involving compensation for services provided to us as an employee, consultant or director will not be considered related person transactions under this policy.

A related person is any executive officer, director, nominee to become a director or a holder of more than 5% of any class of our voting securities (including the common stock), including any of their immediate family members and affiliates, including entities owned or controlled by such persons.

Under the policy, the related person in question or, in the case of transactions with a holder of more than 5% of any class of our voting securities, an officer with knowledge of a proposed transaction, must present information regarding the proposed related person transaction to the audit committee (or, where review by the audit committee would be inappropriate, to another independent body of the board) for review.

To identify related person transactions in advance, we will rely on information supplied by our executive officers, directors and certain significant stockholders.

In considering related person transactions, the audit committee will take into account the relevant available facts and circumstances, which may include, but are not limited to:

the risks, costs, and benefits to us;

the impact on a director’s independence in the event the related person is a director, immediate family member of a director or an entity with which a director is affiliated;

the terms of the transaction;

the availability of other sources for comparable services or products;

the terms available to or from, as the case may be, unrelated third parties.

The audit committee will approve only those transactions that it determines are fair to us and in our best interests.

All of the transactions described above were entered into prior to the adoption of such policy.

Related Person Transactions

Other than compensation arrangements for our directors and executive officers, the following is a description of transactions since January 1, 2019 to which we were a party or will be a party, in which:

the amounts involved exceeded or will exceed $120,000;

any of our directors, executive officers or holders of more than 5% of our capital stock, or any member of the immediate family of, or person sharing the household with, the foregoing persons, had or will have a direct or indirect material interest.

dMY Relationships and Related Person Transactions

Founder Shares

On September 14, 2020, our

Sponsor purchased 7,187,500 founder shares for an aggregate price of $25,000, or approximately $0.003 per share.

On November 12, 2020, dMY effected a 1:1.1 stock split of the Class B common stock, resulting in an aggregate of 7,906,250

founder shares outstanding.

The initial stockholders agreed to forfeit up to 1,031,250 founder shares to the extent that the over-allotment option was not exercised in full by the underwriters in the initial public offering.

The forfeiture would be

adjusted to the extent that the over-allotment option was not exercised in full by the underwriters so that the founder shares would represent 20.0% of the common stock after the initial public offering.

The underwriters partially exercised their

over-allotment option;

thus, 406,250 founder shares were forfeited, resulting in an aggregate of 7,500,000 founder shares outstanding.

Our Sponsor has

agreed, subject to limited exceptions, not to transfer, assign or sell any of the founder shares until the earlier to occur of:

(i) one year after the completion of the initial Business Combination;

and (ii) the date following the

completion of the initial Business Combination on which we complete a liquidation, merger, capital stock exchange or other similar transaction that results in all of our stockholders having the right to exchange their common stock for cash,

securities or other property.

Notwithstanding the foregoing, if the closing price of shares of the Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock capitalizations, reorganizations, recapitalizations

and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the initial business combination, the founder shares will be released from the lockup.

On September 14, 2020, the Sponsor subscribed for 7,187,500 Founder Shares for a total subscription price of $25,000, and fully paid for these on November 17, 2020.

In October 2020, the Sponsor transferred 25,000 Founder Shares to each of Darla Anderson, Francesca Luthi and Charles E.

Wert, dMY’s directors.

On November 12, 2020, dMY effected a 1:1.1 stock split of the Class B Stock, resulting in an aggregate of 7,906,250 shares outstanding.

All shares and associated amounts have been retroactively restated to reflect the stock split.

The Sponsor agreed to forfeit up to 1,031,250 Founder Shares to the extent that the over-allotment option was not exercised in full by the underwriters, so that the Founder Shares will represent 20.0% of dMY’s issued and outstanding shares after the dMY IPO.

On November 17, 2020, the underwriters partially exercised their over-allotment option to purchase 2,500,000 Public Units;

thus, only 406,250 Founder Shares were forfeited, resulting in an aggregate of 7,500,000 Founder Shares outstanding.

The Initial Stockholders agreed, subject to limited exceptions, not to transfer, assign or sell any of the Founder Shares until the earlier to occur of:

(A) one year after the completion of the initial business combination or earlier if, subsequent to the business combination, the closing price of the Class A Stock equals or exceeds $12.50 per share (as adjusted for stock splits, stock capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading

day period commencing at least 150 days after the initial business combination and (B) the date following the completion of the business combination on which IonQ completes a liquidation, merger, capital stock exchange or other similar transaction that results in all of the stockholders having the right to exchange their Common Stock for cash, securities or other property.

Private Placement Warrants

On November 17, 2020, simultaneously with the consummation of the initial public offering, we consummated the private placement of 4,000,000 private

placement warrants at a price of $2.00 per private placement warrant to the Sponsor, generating proceeds of $8,000,000.

Each whole private placement

warrant is exercisable for one whole share of Class A common stock at a price of $11.50 per share.

A portion of the proceeds from the sale of the private placement warrants to the Sponsor was added to the proceeds from the initial public

offering held in the trust account.

If we do not complete a business combination by November 17, 2022, the private placement warrants will expire worthless.

The private placement warrants will be

non-redeemable for cash and exercisable on a cashless basis so long as they are held by the Sponsor or its permitted transferees.

The Sponsor and our officers and directors has agreed, subject to limited exceptions, not to transfer, assign or sell any of their private placement warrants

until 30 days after the completion of the initial business combination.

Simultaneously with the closing of the dMY IPO, dMY consummated the Private Placement of 4,000,000 Private Placement Warrants at a price of $2.00 per Private Placement Warrant to the Sponsor, generating gross proceeds of $8.0 million (including approximately $7.95 million in cash and approximately $50,000 in subscription receivable).

Each whole Private Placement Warrant is exercisable for one whole share of Class A Stock at a price of $11.50 per share.

A portion of the proceeds from the sale of the Private Placement Warrants to the Sponsor was added to the proceeds from the dMY IPO held in the Trust Account.

The Private Placement Warrants are non-redeemable

for cash and exercisable on a cashless basis so long as they are held by the Sponsor or its permitted transferees.

The Sponsor exercised the Private Placement Warrants on a cashless basis in December 2021 and received 2.2 million shares of our common stock.

Related Party Loans

On September 14, 2020, the Sponsor agreed to loan the Company an aggregate of up to $200,000 to cover expenses related to the Initial Public Offering

pursuant to a promissory note (the Note).

This loan is non-interest bearing and payable upon the completion of the Initial Public Offering.

As of December 31, 2020, the Company has

approximately $31,000 outstanding under the Note.

In addition, in order to finance transaction costs in connection with a Business Combination, the

Sponsor or an affiliate of the Sponsor, or certain of the Companys officers and directors may, but are not obligated to, loan the Company funds as may be required (Working Capital Loans).

If the Company completes a Business

Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company.

Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account.

In the event that

a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans.

the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans.

The Working Capital Loans would either be repaid upon consummation of a Business Combination or, at

the lenders discretion, up to $1.5 million of such Working Capital Loans may be convertible into warrants of the post Business Combination entity at a price of $2.00 per warrant.

The warrants would be identical to the Private Placement

As of September 30, 2020, the Company had no borrowings under the Working Capital Loans.

On September 14, 2020, the Sponsor agreed to loan dMY an aggregate of up to $200,000 to cover expenses related to the dMY IPO pursuant to the Note.

This loan was non-interest

bearing and was paid off upon the completion of the dMY IPO.

Administrative Services Agreement

We entered into an agreement that provides that, subsequent to the closing of the initial public offering and continuing until the earlier of the

consummation of a business combination or our liquidation, we will pay the Sponsor a total of $10,000 per month for office space, secretarial and administrative services.

The Sponsor, executive officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business combinations.

Our audit committee

will review on a quarterly basis all payments that were made to the Sponsor, officers, directors or their affiliates.

Principal Accounting Fees and Services

The following is a summary of fees paid to WithumSmith+Brown, PC, for services rendered.

Audit fees consist of fees billed for professional services rendered for the audit of our year-end

financial statements, reviews of our quarterly financial statements and services that are normally provided by our independent registered public accounting firm in connection with statutory and regulatory filings.

The aggregate fees billed by

WithumSmith+Brown, PC for audit fees, inclusive of required filings with the SEC for the period from September 14, 2020 (inception) through December 31, 2020, and of services rendered in connection with our initial public offering, totaled

dMY entered into an agreement that provides that, commencing on the date of the dMY IPO continuing until the earlier of dMY’s consummation of an initial business combination and dMY’s liquidation, dMY paid the Sponsor a total of $10,000 per month for office space, secretarial and administrative services provided to members of dMY’s management team.

The Sponsor, executive officers and directors, or any of their respective affiliates were reimbursed for any out-of-pocket

expenses incurred in connection with activities on dMY’s behalf such as identifying potential target businesses and performing due diligence on suitable business combinations.

dMY’s audit committee will review on a quarterly basis all payments that were made to the Sponsor, executive officers or directors, or dMY’s or their affiliates.

Private Placements of Securities by Legacy IonQ Prior to the Closing of the Business Combination

Preferred Stock Financing

Between August 2019 and November 2019, Legacy IonQ issued and sold an aggregate of 11,166,941 shares of Legacy IonQ Series B-1

preferred stock at a purchase price of $5.5757 per share, for an aggregate purchase price

of $62.3 million.

Each share of Legacy IonQ Series B-1

preferred stock was canceled and converted into the right to receive the number of shares of common stock equal to the Exchange Ratio (as defined in the Merger Agreement) upon the consummation of the business combination.

The table below sets forth the number of shares of Legacy IonQ Series B-1

preferred stock purchased by Legacy IonQ’s related parties:

Shares of Series B-1

Preferred Stock

Total Purchase

New Enterprise Associates 15, L.P.

GV 2019, L.P.

Ronald Bernal, a member of our board of directors, is a partner of New Enterprise Associates 15, L.P., a beneficial owner of greater than 5% of our capital stock.

Blake Byers, a member of our board of directors, was previously a partner of GV 2019, L.P., a beneficial owner of greater than 5% of our capital stock.

Business Combination Related Person Transactions

PIPE Investment

In connection with the execution of the Merger Agreement, dMY entered into subscription agreements with the PIPE investors, pursuant to which the PIPE investors agreed to purchase, and dMY agreed to sell the PIPE investors, an aggregate of 34,500,000 shares of dMY common stock, for a purchase price of $10.00 per share and an aggregate purchase price of $345.0 million, in the PIPE investment.

The table below sets forth the number of shares of dMY common stock to be purchased by our related parties in the PIPE offering:

Shares of dMY common stock

Total Purchase Price

Blake Byers (1)

New Enterprise Associates 15, L.P.

GV 2016, L.P.

Blake Byers, a member of our board of directors, was previously a partner of GV 2016, L.P., a beneficial owner of greater than 5% of our capital stock.

Ronald Bernal, a member of our board of directors, is a partner of New Enterprise Associates 15, L.P., a beneficial owner of greater than 5% of our capital stock.

Stockholder Support Agreement

On March 7, 2021, dMY, Legacy IonQ and certain Legacy IonQ stockholders, including holders affiliated with members of Legacy IonQ’s board of directors and beneficial owners of greater than 5% of Legacy IonQ’s capital stock, representing 54.88% of the voting power of Legacy IonQ’s then-outstanding shares of capital stock, entered into the Stockholder Support Agreement, whereby such Legacy IonQ stockholders agreed to, among other things, promptly (and in any event within three business days) following the SEC declaring effective the proxy statement/prospectus, vote or provide consent with respect to the securities of Legacy IonQ set forth in the Stockholder Support Agreement, in favor of the approval and adoption of the Merger Agreement and the transactions contemplated therein.

Additionally, such Legacy IonQ stockholders agreed, among other things, to not transfer any securities of Legacy IonQ set forth in the Stockholder Support Agreement from March 7, 2021 until the earlier of the effective time or the termination of the Merger Agreement in accordance with its terms, subject to certain exceptions.

Amended and Restated Registration Rights Agreement

In connection with the closing of the business combination, we, the Sponsor, the former dMY directors and certain of our securityholders entered into an amended and restated registration rights agreement.

Pursuant to the

agreement, we agreed that we will file with the SEC a registration statement registering the resale of certain securities held by or issuable to such holders, and we will use reasonable best efforts to have such registration statement declared effective as soon as practicable after the filing thereof.

In certain circumstances, certain holders can demand up to two underwritten offerings in any 12 month period, and certain holders are entitled to piggyback registration rights.

In connection with the business combination, the Sponsor, the current management of Legacy IonQ, the former dMY directors and certain stockholders of Legacy IonQ entered into a lock-up

agreement, which we refer to as the “Lock-Up

Agreements.” The parties to such Lock-Up

Agreements agree not to, without the prior written consent of the Board, during the applicable lock-up

sell, offer to sell, contract or agree to sell, hypothecate, pledge, grant any option, right or warrant to purchase or otherwise transfer, dispose of or agree to transfer or dispose of, directly or indirectly, or establish or increase a put equivalent position or liquidate or decrease a call equivalent position within the meaning of the Exchange Act, and the rules and regulations of the SEC promulgated thereunder, any shares of common stock held by it immediately after closing (including common stock acquired as part of the PIPE investment or issued in exchange for, or on conversion or exercise of, any securities issued as part of the PIPE investment), any shares of common stock issuable upon the exercise of options to purchase shares of common stock held by it immediately after closing, or any securities convertible into or exercisable or exchangeable for common stock held by it immediately after closing (the “Lock-Up

enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any of the Lock-Up

Shares, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise or

publicly announce any intention to effect any transaction specified in the foregoing clauses.

Pursuant to the Lock-Up

Agreement, the parties agreed to transfer restrictions as follows:

(i) certain stockholders of Legacy IonQ will be restricted until the earlier of (x) March 30, 2022 (180 days after the closing date) and (y) the date on which the Company completes a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of our stockholders having the right to exchange their shares for cash, securities or other property;

(ii) members of our management will be restricted until the earlier of (x) 365 days after the closing date, (y) the day after the date on which the closing price of our common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading

day period commencing at least 180 days after the closing date and (z) the date on which we complete a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of our stockholders having the right to exchange their shares for cash, securities or other property;

and (iii) members of dMY’s board of directors and the Sponsor will be restricted until the earlier of (x) 365 days after the closing date, (y) the day after the date on which the closing price of our common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading

day period commencing at least 150 days after the closing date and (z) the date on which we complete a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of our stockholders having the right to exchange their shares for cash, securities or other property.

In addition, the PIPE investors have agreed to be bound by lock-up

provisions with respect to their subscribed shares.

periods for strategic investors vary between 6 and 18 months, subject to certain conditions, depending on the number of shares of common stock subscribed for by each strategic investor and a number of other factors.

Venture capital and other investors have agreed to be bound by lock-up

provisions with respect to their subscribed shares for a period of 180 days, subject to the terms of their subscription agreements or, in the case of certain investors that were previously investors in dMY, the Lock-Up

Agreement described above.

Indemnification Agreements

Our Certificate of Incorporation contains provisions limiting the liability of executive officers and directors, and the Bylaws provide that we will indemnify each of our executive officers and directors to the fullest extent permitted under Delaware law.

The Certificate of Incorporation and the Bylaws also provide the board of directors with discretion to indemnify certain key employees when determined appropriate by the board.

We have entered into indemnification agreements with all of our directors and executive officers and certain other key employees.

The indemnification agreements provide that we will indemnify each of our directors, executive officers, and other key employees against any and all expenses incurred by such director, executive officer, or other key employee because of his or her status as one of our directors, executive officers, or other key employees, to the fullest extent permitted by Delaware law, the Certificate of Incorporation and the Bylaws.

In addition, the indemnification agreements provide that, to the fullest extent permitted by Delaware law, we will advance all expenses incurred by our directors, executive officers, and other key employees in connection with a legal proceeding involving his or her status as a director, executive officer, or key employee.

Board of Directors Independence

The Board has reviewed the independence of each director.

Based on information provided by each director concerning his background, employment and affiliations, the Board determined that none of the directors, other than Messrs.

Chapman and Kim, has any relationships that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that each of the directors is “independent” as that term is defined under the NYSE listing standards.

In making these determinations, the board considered the current and prior relationships that each non-employee director

has with us and all other facts and circumstances the board deemed relevant in determining their independence, including the beneficial ownership of our securities by each non-employee director

and the transactions described above.

Principal Accountant Fees and Services.

Changes in Registrant’s Certifying Accountant.

As previously disclosed, in connection with the closing of the business combination on September 30, 2021, WithumSmith+Brown, PC, (“Withum”) was dismissed as our independent registered public accounting firm.

This decision was approved by the Board.

Withum served as the independent registered public accounting firm for dMY prior to the business combination.

The Board approved the appointment of Ernst & Young LLP (“Ernst & Young”) as our independent registered public accounting firm on September 30, 2021.

Ernst & Young served as the independent registered public accounting firm for Legacy IonQ prior to the business combination.

Principal Accountant Fees and Services

The following tables present the aggregate fees billed by Ernst & Young and Withum to us (including Legacy IonQ, in the case of Ernst & Young) for the fiscal years ended December 31, 2021 and 2020.

Ernst & Young

Audit fees (1)

Audit-related fees

Audit-related fees consist of fees billed for assurance and related services that are reasonably related to

performance of the audit or review of our year-end financial statements and are not reported under Audit Fees. These services include attest services that are not required by statute or regulation

and consultation concerning financial accounting and reporting standards.

We did not pay WithumSmith+Brown, PC any audit-related fees during the period from September 14, 2020 (inception) through December 31, 2020.

Tax fees consist of fees billed for professional services relating to tax compliance, tax planning and tax advice.

We did not pay

WithumSmith+Brown, PC any tax fees during the period from September 14, 2020 (inception) through December 31, 2020.

All other fees

other fees consist of fees billed for all other services.

We did not pay WithumSmith+Brown, PC any other fees during the period from September 14, 2020 (inception) through December 31, 2020.

Exhibits, Financial Statement Schedules.

(a) The following documents are filed as part of this Annual Report on Form 10-K:

Financial Statements:

See Index to Financial Statements at Item 8.

Financial Statements and

Supplementary Data herein.

Financial Statement Schedules.

All schedules are omitted for the reason that the information is included in the

financial statements or the notes thereto or that they are not required or are not applicable.

The exhibits listed in the Exhibit Index below are filed or incorporated by reference as part of this

Annual Report on Form 10-K.

Exhibit Index

Agreement and Plan of Merger, dated as of March

7, 2021, by and among the Company, Ion Trap Acquisition Inc.

and IonQ, Inc.

(incorporated by reference to Exhibit 2.1 to the Companys Current Report on Form 8-K (File No.

filed with the Securities and Exchange Commission on March 8, 2021).

Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Companys Current Report on Form 8-K (File No.

001-39694), filed with the Securities and Exchange Commission on November 17, 2020).

Bylaws (incorporated by reference to Exhibit 3.3 to the Companys Registration Statement on Form S-1 (File

333-249524), filed with the Securities and Exchange Commission on October 16, 2020).

Specimen Unit Certificate (incorporated by reference to Exhibit 4.1 to the Companys Registration Statement on Form S-1 (File No.

333-249524), filed with the Securities and Exchange Commission on October 16, 2020).

Specimen Class

A Common Stock Certificate (incorporated by reference to Exhibit 4.2 to the Companys Registration Statement on Form S-1 (File No.

333-249524), filed with the Securities and Exchange Commission on October 16, 2020).

Specimen Warrant Certificate (incorporated by reference to Exhibit 4.3 to the Companys Registration Statement on Form S-1 (File No.

333-249524), filed with the Securities and Exchange Commission on October 16, 2020).

Warrant Agreement by and between the Company and Continental Stock Transfer

& Trust Company (incorporated by reference to Exhibit 4.1 to the Companys Current Report on Form 8-K (File No.

001-39694), filed with the Securities and Exchange Commission on November 17, 2020).

Description of Securities.

Letter Agreement among the Company, its officers, certain directors, dated as of November

12, 2020 (incorporated by reference to Exhibit 10.1 to the Companys Current Report on Form 8-K (File No.

001-39694), filed with the Securities and Exchange Commission on November 17, 2020).

Promissory Note, dated September

14, 2020, issued to dMY Sponsor III, LLC (incorporated by reference to Exhibit 10.6 to the Companys Registration Statement on Form S-1 (File No.

333-249524), filed with the Securities and Exchange Commission on October 16, 2020).

Registration Rights Agreement, dated November

12, 2020, by and among the Company, dMY III Sponsor, LLC and the holders party thereto (incorporated by reference to Exhibit 10.3 to the Companys Current Report on Form 8-K (File No.

001-39694), filed with the Securities and Exchange Commission on November 17, 2020).

Administrative Service Agreement, dated as of November

12, 2020, by and between the Company and dMY Sponsor III, LLC (incorporated by reference to Exhibit 10.5 to the Companys Current Report on Form 8-K (File No.

001-39694), filed with the Securities and Exchange Commission on November 17, 2020).

Securities Subscription Agreement, dated as of September

14, 2020, by and between the Company and dMY Sponsor III, LLC (incorporated by reference to Exhibit 10.7 to the Companys Registration Statement on Form S-1 (File No.

333-249524), filed with the Securities and Exchange Commission on October 16, 2020).

Form of Indemnity Agreement (incorporated by reference to Exhibit 10.5 to the Companys Registration Statement on Form S-1 (File No.

333-249524), filed with the Securities and Exchange Commission on October 16, 2020).

Form of Subscription Agreement (incorporated by reference to Exhibit 10.1 to the Companys Current Report on Form 8-K (File No.

001-39694), filed with the Securities and Exchange Commission on March 8, 2021).

Hyundai Subscription Agreement, dated as of March

7, 2021, , by and among the Company and Hyundai Motor Company(incorporated by reference to Exhibit 10.2 to the Companys Current Report on Form 8-K (File No.

001-39694), filed with the Securities and Exchange Commission on March 8, 2021).

Kia Subscription Agreement, dated as of March

7, 2021, by and among the Company and Kia Motors Corporation (incorporated by reference to Exhibit 10.3 to the Companys Current Report on Form 8-K (File No.

001-39694), filed with the Securities and Exchange Commission on March 8, 2021).

MSD Subscription Agreement, dated as of March

7, 2021, by and among the Company and MSD Partners, L.P.(incorporated by reference to Exhibit 10.4 to the Companys Current Report on Form 8-K (File No.

001-39694), filed with the Securities and Exchange Commission on March 8, 2021).

Silver Lake Subscription Agreement, dated as of March

7, 2021, by and among the Company and Silver Lake Partners VI DE (AIV), L.P.

(incorporated by reference to Exhibit 10.5 to the Companys Current Report on Form 8-K (File No.

filed with the Securities and Exchange Commission on March 8, 2021).

BEV Subscription Agreement, dated as of March

7, 2021, by and among the Company and Breakthrough Energy Ventures II, L.P.

(incorporated by reference to Exhibit 10.6 to the Companys Current Report on Form 8-K (File No.

filed with the Securities and Exchange Commission on March 8, 2021).

Form Venture Capital / Other Investors Subscription Agreement (incorporated by reference to Exhibit 10.7 to the Companys Current Report

on Form 8-K (File No.

001-39694), filed with the Securities and Exchange Commission on March 8, 2021).

Form Sponsor Support Agreement (incorporated by reference to Exhibit 10.8 to the Companys Current Report on Form 8-K (File No.

001-39694), filed with the Securities and Exchange Commission on March 8, 2021).

Form Stockholder Support Agreement (incorporated by reference to Exhibit 10.9 to the Companys Current Report on Form 8-K (File No.

001-39694), filed with the Securities and Exchange Commission on March 8, 2021).

Form Lock-Up Agreement (incorporated by reference to Exhibit 10.10 to the Companys Current Report

on Form 8-K (File No.

001-39694), filed with the Securities and Exchange Commission on March 8, 2021).

Form Lock-Up Agreement (incorporated by reference to Exhibit 10.10 to the Companys Current Report

on Form 8-K (File No.

001-39694), filed with the Securities and Exchange Commission on March 8, 2021).

Form Amended and Restated Registration Rights Agreement (incorporated by reference to Exhibit 10.11 to the Companys Current Report on

Form 8-K (File No.

001-39694), filed with the Securities and Exchange Commission on March 8, 2021).

Code of Business Conduct and Ethics.

Power of Attorney (included on signature page of this report).

Certification of the Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a).

Certification of the Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a).

Certification of the Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C.

Certification of the Chief Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C.

XBRL Instance Document

XBRL Taxonomy Extension Schema Document

XBRL Taxonomy Extension Calculation Linkbase Document

XBRL Taxonomy Extension Definition Linkbase Document

XBRL Taxonomy Extension Label Linkbase Document

XBRL Taxonomy Extension Presentation Linkbase Document

Certain of the exhibits and schedules to this Exhibit have been omitted in accordance with Regulation S-K Item 601(a)(5).

Audit fees in 2021 consisted of fees billed for professional services rendered for the audit of IonQ, Inc.’s 2021 consolidated financial statements, the reviews of 2021 interim condensed consolidated financial statements, audit services in connection with the accounting for the business combination, and audit services provided in connection with other regulatory filings and offerings, including the regulatory filings associated with the business combination and related financings.

Audit fees for 2020 consisted of fees billed for professional services rendered for the audit of Legacy IonQ’s consolidated financial statements (2019 and 2020), the reviews of the applicable historical interim condensed consolidated financial statements, and audit services provided in connection with other regulatory filings and offerings, including the regulatory filings associated with the business combination and related financings.

Audit fees (1)

Audit-related fees

All other fees

Audit fees in 2021 consisted of fees billed for professional services rendered for the audit of dMY’s restated 2020 annual financial statements, interim reviews of dMY’s quarterly financial statements, and services that were normally provided by Withum in connection with regulatory filings.

Audit fees in 2020 include fees billed for professional services rendered for the audit of dMY’s annual financial statements and other required filings with the SEC.

Tax fees consisted of fees billed for professional services relating to tax compliance services.

All fees were pre-approved

by our Audit Committee.

Policies and Procedures

Our Audit Committee approves all audit and pre-approves

all non-audit

services provided by Ernst & Young before it is engaged by us to render non-audit

services to ensure that the provision of these services does not impair the auditor’s independence.

These services may include audit-related services, tax services and other non-audit

The pre-approval

requirement set forth above does not apply with respect to non-audit

all such services do not, in the aggregate, amount to more than 5% of the total fees paid by us to Ernst & Young during the fiscal year in which the services are provided;

such services were not recognized as non-audit

services at the time of the relevant engagement;

such services are promptly brought to the attention of and approved by the Audit Committee (or its delegate) prior to the completion of the annual audit.

The Audit Committee elected to delegate pre-approval

authority to the chair of the Audit Committee to approve any one or more individual permitted non-audit

The chair will report any pre-approval

granted at the next meeting of the Audit Committee.

Exhibit and Financial Statement Schedules.

The financial statements schedules and exhibits filed as part of

this Annual Report are as follows:

(a)(1) Financial Statements

Report of Independent Registered Public Accounting Firm (PCAOB ID 42 )

Consolidated Balance Sheets

Consolidated Statements of Operations

Consolidated Statements of Comprehensive Loss

Consolidated Statements of Changes in Convertible Redeemable Preferred Stock, Warrants and Stockholders’ Equity

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements

(a)(2) Financial Statement Schedules

All other schedules are omitted because they are not required or the required information is included in the financial statements or notes thereto.

(a)(3) Exhibits

The exhibits required to be filed as part of this report are listed in the Exhibit List attached hereto and are incorporated herein by reference.

Agreement and Plan of Merger, dated as of March 7, 2021, by and among dMY Technology Group, Inc.

III, IonQ, Inc.

and IonQ Trap Acquisition Inc.

(incorporated herein by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on March 8, 2021).

Second Amended and Restated Certificate of Incorporation of the Company (incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on October 4, 2021).

Amended and Restated Bylaws of the Company (incorporated herein by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on October 4, 2021).

Specimen Common Stock Certificate (incorporated herein by reference to Exhibit 4.4 to the Company’s Registration Statement on Form S-4/A (File No.

333-254840), filed with the SEC on August 11, 2021).

Warrant Agreement, dated November 12, 2020, between Continental Stock Transfer & Trust Company and IonQ, Inc.

(incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on November 17, 2020).

Description of the Registrant’s Securities.

Amended and Restated Registration Rights Agreement, dated September 30, 2021, between and among the investors party thereto and IonQ, Inc.

(incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on October 4, 2021).

Form of Subscription Agreement (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on March 8, 2021).

Hyundai Subscription Agreement (incorporated herein by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on March 8, 2021).

Kia Subscription Agreement (incorporated herein by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on March 8, 2021).

MSD Subscription Agreement (incorporated herein by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on March 8, 2021).

Silver Lake Subscription Agreement (incorporated herein by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on March 8, 2021).

BVE Subscription Agreement (incorporated herein by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on March 8, 2021).

Form of Venture Capital / Other Investors Subscription Agreement (incorporated herein by reference to Exhibit 10.7 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on March 8, 2021).

Form of Sponsor Support Agreement (incorporated herein by reference to Exhibit 10.8 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on March 8, 2021).

Form of Stockholder Support Agreement (incorporated herein by reference to Exhibit 10.9 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on March 8, 2021).

Form of Lock-Up Agreement (incorporated herein by reference to Exhibit 10.10 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on March 8, 2021).

Change in Control Severance Plan and Summary Plan Description (incorporated herein by reference to Exhibit 10.36 to the Company’s Registration Statement on Form S-4/A (File No.

333-254840), filed with the SEC on August 5, 2021).

Form of Indemnification Agreement of IonQ, Inc.

(incorporated herein by reference to Exhibit 10.13 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on October 4, 2021).

2015 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.14 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on October 4, 2021).

Forms of Stock Option Grant Notice and Option Agreement under 2015 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.15 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on October 4, 2021).

2021 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.16 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on October 4, 2021).

Forms of Option Grant Notice and Option Agreement under 2021 Equity Incentive Plan.

Form of Restricted Stock Unit Grant Notice and Unit Award Agreement under 2021 Equity Incentive Plan.

2021 Employee Stock Purchase Plan (incorporated herein by reference to Exhibit 10.19 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on October 4, 2021).

Amended and Restated Office Lease, by and between University of Maryland – College Park and IonQ, Inc.

(incorporated herein by reference to Exhibit 10.20 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the SEC on October 4, 2021)

Warrant to Purchase Shares, dated November 27, 2019, issued to Amazon.com NV Investment Holdings LLC by IonQ, Inc.

(incorporated herein by reference to Exhibit 10.33 to the Company’s Registration Statement on Form S-4/A (File No.

333-254840), filed with the SEC on July 16, 2021).

License Agreement, dated July 19, 2016, among the University of Maryland, Duke University and IonQ, Inc.

(incorporated herein by reference to Exhibit 10.20 to the (incorporated herein by reference to Exhibit 10.20 to the Company’s Registration Statement on Form S-4/A (File No.

333-254840), filed with the SEC on June 17, 2021).

Amendment No.

1 to Exclusive License Agreement, dated September 22, 2017, between Duke University and the Registrant (incorporated herein by reference to Exhibit 10.21 to the Company’s Registration Statement on Form S-4/A (File No.

333-254840), filed with the SEC on June 17, 2021).

Amendment No.

1 to Exclusive License Agreement, dated October 11, 2017, between the University of Maryland and IonQ, Inc.

(incorporated herein by reference to Exhibit 10.22 to the Company’s Registration Statement on Form S-4/A (File No.

333-254840), filed with the SEC on June 17, 2021).

Amendment No.

2 to Exclusive License Agreement, dated October 4, 2018, between Duke University and IonQ, Inc.

(incorporated herein by reference to Exhibit 10.23 to the Company’s Registration Statement on Form S-4/A (File No.

333-254840), filed with the SEC on June 17, 2021).

Amendment No.

2 to Exclusive License Agreement, dated October 9, 2018, between the University of Maryland and IonQ, Inc.

(incorporated herein by reference to Exhibit 10.24 to the Company’s Registration Statement on Form S-4/A (File No.

333-254840), filed with the SEC on June 17, 2021).

Amendment No.

3 to Exclusive License Agreement, dated April 27, 2021, between Duke University, the University of Maryland and IonQ, Inc.

(incorporated herein by reference to Exhibit 10.25 to the Company’s Registration Statement on Form S-4/A (File No.

333-254840), filed with the SEC on June 17, 2021).

Amendment No.

4 to Exclusive License Agreement, dated April 27, 2021, between Duke University, the University of Maryland and IonQ, Inc.

(incorporated herein by reference to Exhibit 10.26 to the Company’s Registration Statement on Form S-4/A (File No.

333-254840), filed with the SEC on June 17, 2021).

Amendment No.

5 to Exclusive License Agreement, dated September 10, 2021, between Duke University and IonQ, Inc.

Amendment No.

5 to Exclusive License Agreement, dated September 24, 2021, between the University of Maryland and IonQ, Inc.

Exclusive Option Agreement, dated July 15, 2016, between Duke University and IonQ, Inc.

(incorporated herein by reference to Exhibit 10.27 to the Company’s Registration Statement on Form S-4/A (File No.

333-254840), filed with the SEC on June 17, 2021).

First Amendment to Option Agreement, dated December 18, 2020, between Duke University and IonQ, Inc.

(incorporated herein by reference to Exhibit 10.28 to the Company’s Registration Statement on Form S-4/A (File No.

333-254840), filed with the SEC on June 17, 2021).

Second Amendment to Option Agreement, dated March 19, 2021, between Duke University and IonQ, Inc.

(incorporated herein by reference to Exhibit 10.29 to the Company’s Registration Statement on Form S-4/A (File No.

333-254840), filed with the SEC on June 17, 2021).

Non-Employee Director Compensation Policy.

List of Subsidiaries of Company (incorporated herein by reference to Exhibit 21.1 to the Company’s Current Report on Form 8-K (File No.

001-39694), filed with the Commission on October 4, 2021).

Consent of Ernst & Young LLP, an Independent Registered Public Accounting Firm.

Power of Attorney (included on the signature page to this report).

Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C.

Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Inline XBRL Instance Document—the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL Document.

Inline XBRL Taxonomy Extension Schema Document

Inline XBRL Taxonomy Extension Calculation Linkbase Document

Inline XBRL Taxonomy Extension Definition Linkbase Document

Inline XBRL Taxonomy Extension Label Linkbase Document

Inline XBRL Taxonomy Extension Presentation Linkbase Document

Cover Page Interactive Data File (formatted as inline XBRL with applicable taxonomy extension information contained in Exhibit 101).

Furnished herewith and not deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act (whether made before or after the date of the Form 10-K),

irrespective of any general incorporation language contained in such filing.

Indicates a management contract or compensatory plan.

Certain of the exhibits and schedules to this Exhibit have been omitted in accordance with Regulation S-K Item 601(b)(10)(iv).

The Registrant agrees to furnish a copy of all omitted exhibits and schedules to the SEC upon its request.

DMY TECHNOLOGY GROUP, INC.

INDEX TO FINANCIAL STATEMENTS

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report on Form 10-K

to be signed on its behalf by the undersigned, thereunto duly authorized .

March 28, 2022

/s/ Peter Chapman

Peter Chapman

President and Chief Executive Officer

( Principal Executive Officer

POWER OF ATTORNEY

Each person whose individual signature appears below hereby authorizes and appoints Peter Chapman and Thomas Kramer, and each of them, with full power of substitution and resubstitution and full power to act without the other, as his or her true and lawful attorney-in-fact

and agent to act in his or her name, place and stead and to execute in the name and on behalf of each person, individually and in each capacity stated below, and to file any and all amendments to this report on Form 10-K,

and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact

and agents, and each of them, full power and authority to do and perform each and every act and thing, ratifying and confirming all that said attorneys-in-fact

and agents or any of them or their or his substitute or substitutes may lawfully do or cause to be done by virtue thereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report on Form 10-K

has been signed below by the following persons on behalf of the Registrant in the capacities and on the dates indicated.

/s/ Peter Chapman

Peter Chapman

President and Chief Executive

Officer and Director

(Principal Executive Officer)

March 28, 2022

/s/ Thomas Kramer

Thomas Kramer

Chief Financial Officer

(Principal Financial and Accounting Officer)

March 28, 2022

/s/ Craig Barratt

Craig Barratt

Chairman of the Board of Directors

March 28, 2022

/s/ Ronald Bernal

Ronald Bernal

March 28, 2022

/s/ Blake Byers

March 28, 2022

/s/ Niccolo de Masi

Niccolo de Masi

March 28, 2022

/s/ Jungsang Kim

Chief Technology Officer

March 28, 2022

/s/ Harry You

March 28, 2022

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm

Financial Statements:

Balance Sheet as of December 31, 2020

Statement of Operations for the period from September

14, 2020 (inception) through December 31, 2020

Statement of Changes in Stockholders Equity for the period from September 14,

2020 (inception) through December 31, 2020

Statement of Cash Flows for the period from September

14, 2020 (inception) through December 31, 2020

Notes to Financial Statements

Consolidated Balance Sheets

Consolidated Statements of Operations

Consolidated Statements of Comprehensive Loss

Consolidated Statements of Changes in Convertible Redeemable Preferred Stock, Warrants and Stockholders’ Equity

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements

Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of

Technology Group Inc.

To the Stockholders and the Board of Directors of IonQ, Inc.

Opinion on the Financial Statements

We have audited the accompanying balance sheet of dMY Technology Group Inc.

III (the Company) as of December 31, 2020, the related statements

of operations, changes in stockholders equity and cash flows for the period from September 14, 2020 (inception) through December 31, 2020, and the related notes (collectively referred to as the financial statements).

our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020, and the results of its operations and its cash flows for the period from September 14, 2020

(inception) through December 31, 2020, in conformity with accounting principles generally accepted in the United States of America.

We have audited the accompanying consolidated balance sheets of IonQ, Inc.

(the Company) as of December 31, 2021 and 2020, the related consolidated statements of operations and comprehensive loss, changes in convertible redeemable preferred stock, warrants and stockholders’ equity and cash flows for the years then ended, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2021 and 2020, and the results of its operations and its cash flows for the years then ended, in conformity with U.S.

generally accepted accounting principles.

Basis for Opinion

These financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the

Companys financial statements based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company

in accordance with the U.S.

Our responsibility is to express an opinion on the Company’s financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to

error or fraud.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audit we are required to obtain an understanding of internal control over financial

reporting but not for the purpose of expressing an opinion on the effectiveness of the Companys internal control over financial reporting.

As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the financial statement, whether due to error or fraud, and

performing procedures that respond to those risks.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audit also included evaluating the accounting principles used and

significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audit provides a reasonable basis for our opinion.

/s/ WithumSmith+Brown, PC

We have served as the Companys

auditor since 2020.

New York, New York

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audits provide a reasonable basis for our opinion.

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 2020.

Tysons, Virginia

March 28, 2022

DMY TECHNOLOGY GROUP, INC.

BALANCE SHEET

December 31, 2020

Consolidated Balance Sheets

(in thousands, except share and per share data)

As of December 31,

Current assets:

Prepaid Assets

Cash and cash equivalents

Short-term investments

Accounts receivable

Prepaid expenses and other current assets ($ 612 and $ 1,013 attributable to related parties)

Total current assets

Investments held in Trust Account

Liabilities and Stockholders Equity:

Long-term investments

Property and equipment, net

Operating lease right-of-use

assets ($ 4,032 and $ 4,296 attributable to related parties)

Intangible assets, net

Other noncurrent assets ($ 1,845 and $ 2,365 attributable to related parties)

Liabilities, Convertible Redeemable Preferred Stock and Warrants, and Stockholders’ Equity

Current liabilities:

1 unchanged sentence

Accrued expenses

Franchise tax payable

Note payable to related parties

Current portion of operating lease liabilities ($ 568 and $ 495 attributable to related parties)

Unearned revenue ($ 2,821 and zero attributable to related parties)

Current portion of stock option early exercise liabilities

Total current liabilities

Deferred underwriting commissions in connection with the initial public offering

Operating lease liabilities, net of current portion ($ 3,643 and $ 3,776 attributable to related parties)

Unearned revenue, net of current portion

Stock option early exercise liabilities, net of current portion

Warrant liabilities

Total liabilities

Commitments and Contingencies (Note 5)

Class A common stock, $0.0001 par value;

28,541,813 shares subject to possible redemption at

$10.00 per share

Stockholders Equity:

Preferred stock, $0.0001 par value;

Commitments and contingencies (see Note 9)

Convertible Redeemable Preferred Stock and Warrants:

Series A convertible redeemable preferred stock;

$ 0.0001 par value per share;

2,000,000 shares authorized;

none issued and

Class A common stock, $0.0001 par value;

after giving effect to the recapitalization there is no convertible redeemable preferred stock issued or outstanding as of December 31, 2021 and 2020

Series B convertible redeemable preferred stock;

$ 0.0001 par value per share;

9,753,798 shares authorized;

1,458,187 shares

issued and outstanding (excluding 28,541,813 shares subject to possible redemption)

Class B common stock, $0.0001 par value;

after giving effect to the recapitalization there is no convertible redeemable preferred stock issued or outstanding as of December 31, 2021 and 2020

convertible redeemable preferred stock;

$ 0.0001 par value per share;

13,217,404 shares authorized;

7,500,000 shares

issued and outstanding

Additional paid-in capital

after giving effect to the recapitalization there is no convertible redeemable preferred stock issued or outstanding as of December 31, 2021 and 2020

Warrants for Series B-1

convertible redeemable preferred stock;

after giving effect to the recapitalization there are no warrants for convertible redeemable preferred stock issued or outstanding as of December 31, 2021 and 2020

Stockholders’ Equity:

Common stock $ 0.0001 par value;

1,000,000,000 and 160,318,719 shares authorized as of December 31, 2021 and December 31, 2020, respectively;

195,630,975 and 118,146,795 shares issued and outstanding as of December 31, 2021 and December 31, 2020, respectively

Additional paid-in

Accumulated deficit

other comprehensive loss

Total stockholders’ equity

Total Liabilities and Stockholders Equity

The accompanying notes are an integral part of these financial statements.

DMY TECHNOLOGY GROUP, INC.

STATEMENT OF OPERATIONS

For the Period from September 14, 2020 (inception) through December 31, 2020

General and administrative expenses

Franchise tax expenses

Total Liabilities, Convertible Redeemable Preferred Stock and Warrants, and Stockholders’ Equity

The accompanying notes are an integral part of these consolidated financial statements.

Consolidated Statements of Operations

(in thousands, except share and per share data)

Year Ended December 31,

Costs and expenses:

Cost of revenue (excluding depreciation and amortization)

Research and development

Sales and marketing

General and administrative

Depreciation and amortization

Total operating costs and expenses

Loss from operations

Gain on marketable securities (net), dividends and interest, held in Trust Account

Loss before income tax expense

Income tax benefit

Weighted average shares outstanding of Class A common stock

Basic and diluted net income per share, Class A common stock

Weighted average shares outstanding of Class B common stock (1)

Basic and diluted net loss per share, Class B common stock

This number excluded up to 1,031,250 shares of Class B common stock subject to forfeiture if the

over-allotment option is not exercised in full or in part by the underwriters.

On November 17, 2020, the underwriters partially exercised their over-allotment option to purchase 2,500,000 units resulting in 625,000 shares of Class B common

stock no longer being subject to forfeiture.

The over-allotment option expired on December 27, 2020, resulting in 406,250 shares of Class B common stock being forfeited.

The accompanying notes are an integral part of these financial statements.

DMY TECHNOLOGY GROUP, INC.

STATEMENT OF CHANGES IN STOCKHOLDERS EQUITY

For the Period from September 14, 2020 (inception) through December 31, 2020

Additional Paid-In

Change in fair value of warrant liabilities

Offering costs associated with warrants

Other income (expense), net

Loss before benefit for income taxes

Benefit for income taxes

Net loss per share attributable to common stockholders—basic and diluted

Weighted average shares used in computing net loss per share attributable to common stockholders—basic and diluted

The accompanying notes are an integral part of these consolidated financial statements.

Consolidated Statements of Comprehensive Loss

(in thousands)

Year Ended December 31,

Other comprehensive loss, net of reclassification adjustments:

Unrealized loss on available-for-sale

securities, net

Total other comprehensive loss

Total comprehensive loss

The accompanying notes are an integral part of these consolidated financial statements.

Consolidated Statements of Changes in Convertible Redeemable Preferred Stock, Warrants and Stockholders’ Equity

(in thousands, except share and per share data)

Convertible Redeemable Preferred Stock

Stockholders’ Equity

Additional Paid -

Comprehensive

Stockholders’

Balance - September 14, 2020 (inception)

Issuance of Class B common stock to Sponsor

Sale of units in initial public offering, gross

Offering costs

Sale of private placement warrants to Sponsor in private placement for cash

Forfeiture of Class B common stock (1)

Common stock subject to possible redemption

Equity/(Deficit)

Balance, December 31, 2019

This number included up to 1,031,250 shares of Class B common stock subject to forfeiture if the

over-allotment option is not exercised in full or in part by the underwriters.

On November 17, 2020, the underwriters partially exercised their over-allotment option to purchase 2,500,000 units resulting in 625,000 shares of Class B common

stock no longer being subject to forfeiture.

The over-allotment option expired on December 27, 2020, resulting in 406,250 shares of Class B common stock being forfeited.

The accompanying notes are an integral part of these financial statements.

DMY TECHNOLOGY GROUP, INC.

STATEMENT OF CASH FLOWS

For the Period from September 14, 2020 (inception) through December 31, 2020

Retroactive application of recapitalization

Adjusted balance, beginning of period

Issuance of common stock in consideration for research and development arrangement

Vesting of warrant issued to a customer

Stock options exercised

Vesting of restricted common stock

Stock-based compensation

Balance, December 31, 2020

Other comprehensive loss

Equity instruments issued in consideration for intellectual property and research and development arrangements

Stock options exercised

Vesting of restricted common stock

Merger and PIPE transaction, net of transaction costs

Stock-based compensation

Warrants exercised

Balance, December 31, 2021

The shares of the Company’s common and convertible redeemable preferred stock and warrants, prior to the Business Combination (as defined in Note 1) have been retroactively restated to reflect the exchange ratio established in the Business Combination.

Legacy IonQ’s convertible redeemable preferred stock and warrants previously classified as mezzanine equity were retroactively adjusted, converted into common stock, and reclassified to permanent equity because of the reverse recapitalization as described in Note 1.

The accompanying notes are an integral part of these consolidated financial statements.

Consolidated Statements of Cash Flows

(in thousands)

Year Ended December 31,

Cash flows from operating activities:

Adjustments to reconcile net income to net cash used in operating activities:

General and administrative expenses paid by related party under note payable

Gain on marketable securities (net), dividends and interest, held in Trust Account

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization

research and development arrangements

Amortization of customer warrant

Offering costs associated with warrants

Stock-based compensation

Change in fair value of warrant liabilities

Changes in operating assets and liabilities:

Prepaid expenses

Accounts receivable

Prepaid expenses and other current assets

Other noncurrent assets

Accounts payable

Accrued expenses

Franchise tax payable

Operating lease liabilities

Unearned revenue

Net cash used in operating activities

Cash flows from investing activities:

Cash deposited in Trust Account

Purchases of property and equipment

Capitalized software development costs

Purchases of available-for-sale

Intangible asset acquisition costs

Net cash used in investing activities

Cash flows from financing activities:

Proceeds from issuance of Class B common stock to Sponsor

Proceeds received from initial public offering, gross

Proceeds received from private placement

Offering costs paid

Paydown of notes payable

Proceeds from stock options exercised

Repurchase of early exercised stock options

Proceeds from public warrants exercised

Proceeds from merger and PIPE transaction, net of transaction costs

Net cash provided by financing activities

Net increase in cash

Cash - beginning of the period

Cash - end of the period

Supplemental disclosure of noncash activities:

Offering costs included in accounts payable

Offering costs funded with note payable

Deferred underwriting commissions in connection with the initial public offering

Initial value of Class A common stock subject to possible redemption

Change value of Class A common stock subject to possible redemption

The accompanying notes are an integral part of these financial statements.

DMY TECHNOLOGY GROUP, INC.

NOTES TO FINANCIAL STATEMENTS

Note 1Description of Organization and Business Operations

dMY Technology Group, Inc.

III (the Company) is a blank check company incorporated in Delaware on September 14, 2020.

Company was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (the Business Combination).

The Company is an

emerging growth company and, as such, the Company is subject to all of the risks associated with emerging growth companies.

December 31, 2020, the Company had not commenced any operations.

All activity for the period from September 14, 2020 (inception) to December 31, 2020 relates to the Companys formation and the preparation of the initial public

offering (the Initial Public Offering) and since the closing of the Initial Public Offering, the search for a prospective initial Business Combination.

The Company will not generate any operating revenues until after the completion of

its initial Business Combination, at the earliest.

The Company will generate non-operating income in the form of interest income on cash and cash equivalents from the proceeds derived from the Initial Public

The Company has selected December 31 as its fiscal year end.

The Companys sponsor is dMY Sponsor III, LLC, a

Delaware limited liability company (the Sponsor).

The registration statement for the Companys Initial Public Offering was declared effective on November 12, 2020.

On November 17, 2020, the Company consummated its Initial

Public Offering of 30,000,000 units (Units and, with respect to the Class A common stock included in the Units being offered, the Public Shares), including the 2,500,000 Units as a result of the underwriters

partial exercise of their over-allotment option (the Over-Allotment Units), at $10.00 per Unit, generating gross proceeds of $300.0 million, and incurring offering costs of approximately $16.96 million, inclusive of

$10.50 million in deferred underwriting commissions (Note 5).

Simultaneously with the closing of the Initial Public Offering, the

Company consummated the private placement (Private Placement) of 4,000,000 warrants at a price of $2.00 per warrant (Private Placement Warrants) to the Sponsor, generating gross proceeds of $8.0 million (Note 4).

Upon the closing of the Initial Public Offering and the Private Placement, $300.0 million ($10.00 per Unit) of the net proceeds of the

Initial Public Offering and certain of the proceeds of the Private Placement were placed in a trust account (Trust Account) located in the United States with Continental Stock Transfer & Trust Company acting as trustee, and

invested only in United States government securities within the meaning of Section 2(a)(16) of the Investment Company Act 1940, as amended (the Investment Company Act) having a maturity of 185 days or less or in money

market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S.

government treasury obligations, as determined by the Company, until the

(i) the completion of a Business Combination and (ii) the distribution of the Trust Account as described below.

Companys management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of Private Placement Warrants, although substantially all of the net proceeds are intended to be

applied generally toward consummating a Business Combination.

There is no assurance that the Company will be able to complete a Business Combination successfully.

The Company must complete one or more initial Business Combinations having an

aggregate fair market value of at least 80% of the net assets held in the Trust Account (net of amounts disbursed to management for working capital purposes, if permitted, and excluding the amount of any deferred underwriting commissions) at the

time of the agreement to enter into the initial Business Combination.

However, the Company will only complete a Business Combination if the post-transaction company owns or acquires 50% or more of the voting securities of the target or otherwise

acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act.

The Company will provide the holders (the Public Stockholders) of the Companys outstanding shares of Class A common

stock, par value $0.0001 per share, sold in the Initial Public Offering (the Public Shares) with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in

connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer.

The decision as to whether the Company will seek stockholder approval of a Business Combination or conduct

a tender offer will be made by the Company, solely in its discretion.

The Public Stockholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then held in the

Trust Account (initially anticipated to be $10.00 per Public Share).

The per-share amount to be distributed to Public Stockholders who redeem their Public Shares will not be reduced by the deferred

underwriting commissions the Company will pay to the underwriters (as discussed in Note 5).

These Public Shares will be recorded at a redemption value and classified as temporary equity upon the completion of the Initial Public Offering in

accordance with the Financial Accounting Standards Boards (FASB) Accounting Standards Codification (ASC) Topic 480 Distinguishing Liabilities from Equity. The Company will proceed with a Business Combination

if a majority of the shares voted are voted in favor of the Business Combination.

The Company will not redeem the Public Shares in an amount that would cause its net tangible assets to be less than $5,000,001.

If a stockholder vote is not required

by law and the Company does not decide to hold a stockholder vote for business or other legal reasons, the Company will, pursuant to its Certificate of Incorporation (the Certificate of Incorporation), conduct the redemptions pursuant to

the tender offer rules of the U.S.

Securities and Exchange Commission (SEC) and file tender offer documents with the SEC prior to completing a Business Combination.

If, however, stockholder approval of the transaction is required by law,

or the Company decides to obtain stockholder approval for business or legal reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules.

Additionally, each public stockholder may elect to redeem their Public Shares irrespective of whether they vote for or against the proposed transaction.

If the Company seeks stockholder approval in connection with a Business Combination, the initial

stockholders (as defined below) have agreed to vote their Founder Shares (as defined below in Note 4) and any Public Shares purchased during or after the Initial Public Offering in favor of a Business Combination.

In addition, the initial

stockholders have agreed to waive their redemption rights with respect to their Founder Shares and Public Shares in connection with the completion of a Business Combination.

The Certificate of Incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person

with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the Exchange Act)), will be restricted from redeeming its shares with respect

to more than an aggregate of 20% or more of the Public Shares, without the prior consent of the Company.

The Sponsor and the

Companys officers and directors (the initial stockholders) have agreed not to propose an amendment to the Certificate of Incorporation to modify the substance or timing of the Companys obligation to redeem 100% of the Public

Shares if the Company does not complete a Business Combination within the Combination Period (as defined below) or with respect to any other material provisions relating to stockholders rights or

pre-initial Business Combination activity, unless the Company provides the Public Stockholders with the opportunity to redeem their Public Shares in conjunction with any such amendment.

If the Company is unable to complete a Business Combination within 24 months from the closing of the Initial Public Offering, or

November 17, 2022 (the Combination Period), the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the

Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not previously

released to the Company to pay its taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Public Shares, which redemption will completely extinguish Public Stockholders rights as

stockholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining stockholders and our board of directors,

liquidate and dissolve, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.

The initial stockholders agreed to waive their rights to liquidating distributions from the Trust Account with respect to the Founder Shares

if the Company fails to complete a Business Combination within the Combination Period.

However, if the initial stockholders acquire Public Shares in or after the Initial Public Offering, they will be entitled to liquidating distributions from the

Trust Account with respect to such Public Shares if the Company fails to complete a Business Combination within the Combination Period.

The underwriters have agreed to waive their rights to the deferred underwriting commission (see Note 5) held in

the Trust Account in the event the Company does not complete a Business Combination within the Combination Period and, in such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the

redemption of the Public Shares.

the event of such distribution, it is possible that the per share value of the residual assets remaining available for distribution (including Trust Account assets) will be only $10.00.

to protect the amounts held in the Trust Account, the Sponsor has agreed to be liable to the Company if and to the extent any claims by a third party (except for the Companys independent registered public accounting firm) for services rendered

or products sold to the Company, or a prospective target business with which the Company has entered into a letter of intent, confidentiality or other similar agreement or business combination agreement (a Target), reduce the amount of

funds in the Trust Account to below the lesser of (i) $10.00 per Public Share and (ii) the actual amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account, if less than $10.00 per Public Share due

to reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply to any claims by a third party or Target that executed a waiver of any and all rights to the monies held in the Trust Account (whether or

not such waiver is enforceable) not will it apply to any claims under the Companys indemnity of the underwriters of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended

(the Securities Act).

The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers (except for the

Companys Independent Registered Public Accounting Firm), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to

monies held in the Trust Account.

Liquidity and Capital Resources

The accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates, among other

things, the realization of assets and satisfaction of liabilities in the normal course of business.

As of December 31, 2020, the Company had approximately $1.6 million in its operating bank account, approximately $31,000 of interest income

available in the Trust Account to pay for taxes and working capital of approximately $888,000.

Further, the Company has incurred and expect to continue to incur significant costs in pursuit of its acquisition plans.

Prior to the consummation of the Initial Public Offering, the Companys liquidity needs had been satisfied through a capital contribution

of $25,000 from the Sponsor to purchase the Founder Shares (as defined below), the loan under the Note from the Sponsor of approximately $121,000 (see Note 4).

Subsequent to the consummation of the Initial Public Offering, the Companys

liquidity needs had been satisfied through the net proceeds from the consummation of the Private Placement not held in the Trust Account.

To date, the Note remains outstanding.

In addition, in order to finance transaction costs in connection with a

Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Companys officers and directors may, but are not obligated to, provide the Company Working Capital Loans (see Note 4).

To date, there were no amounts

outstanding under any Working Capital Loans.

Based on the foregoing, management believes that the Company will have sufficient working

capital and borrowing capacity from the Sponsor or an affiliate of the Sponsor, or certain of the Companys officers and directors to meet its needs through the earlier of the consummation of a Business Combination or one year from this filing.

Over this time period, the Company will be using these funds for paying existing accounts payable, identifying and evaluating prospective initial Business Combination candidates, performing due diligence on prospective target businesses, paying for

travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating and consummating the Business Combination.

Note 2Basis of Presentation and Summary of Significant Accounting Policies

Basis of Presentation

accompanying financial statements are presented in U.S.

dollars, in conformity with accounting principles generally accepted in the United States of America (GAAP) for financial information and pursuant to the rules and regulations of

Net change in cash and cash equivalents

Cash and cash equivalents at the beginning of the period

Cash and cash equivalents at the end of the period

Supplemental disclosures of non-cash

investing and financing activities

Issuance of common stock for intellectual property

Issuance of common stock for research and development arrangement

Property and equipment purchases in accounts payable and accrued expenses

Intangible asset purchases in accounts payable and accrued expenses

Noncash reclassification of warrant liabilities to equity upon exercise

Vesting of customer warrants

The accompanying notes are an integral part of these consolidated financial statements.

Notes to Consolidated Financial Statements

DESCRIPTION OF BUSINESS

(“IonQ” or “the Company”), formerly known as dMY Technology Group, Inc.

III (“dMY”), was incorporated in the state of Delaware in September 2020 and formed as a special purpose acquisition company for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses.

IonQ Quantum, Inc.

(formerly known as IonQ, Inc., and referred to as “Legacy IonQ” herein), was incorporated in the state of Delaware in September 2015 and is headquartered in College Park, Maryland.

On March 7, 2021, Legacy IonQ entered into an Agreement and Plan of Merger (the “Merger Agreement”) with dMY and Ion Trap Acquisition Inc.

(“Merger Sub”), a direct, wholly owned subsidiary of dMY.

Pursuant to the Merger Agreement, on September 30, 2021 (“the Closing Date”), the Merger Sub was merged with and into Legacy IonQ with Legacy IonQ continuing as the surviving corporation following the Merger, becoming a wholly owned subsidiary of dMY and the separate corporate existence of the Merger Sub ceased (the “Business Combination”).

Commensurate with the Business Combination, dMY changed its name to IonQ, Inc.

and Legacy IonQ changed its name to IonQ Quantum, Inc.

After the Business Combination, IonQ’s common stock and public warrants are traded on the New York Stock Exchange (“NYSE”) under the symbols “IONQ” and “IONQ WS,” respectively.

Unless otherwise indicated, references in this Annual Report on Form 10-K

to the “Company” and “IonQ” refer to the consolidated operations of IonQ, Inc.

and IonQ Quantum, Inc.

References to “dMY” refer to the company prior to the consummation of the Business Combination and references to “Legacy IonQ” refer to IonQ, Inc.

prior to the consummation of the Business Combination.

IonQ is engaged in quantum computing and develops general-purpose quantum computing systems designed to solve the world’s most complex problems, and transform business, society, and the planet for the better.

Prior to 2019, the Company built certain quantum computing systems solely for research & development purposes.

To operate the quantum computing systems, the Company has developed custom hardware, custom firmware, and an operating system to orchestrate the quantum computers.

During 2019, the Company began to commercialize its quantum computing systems and entered into its first significant customer agreements.

Currently, the Company permits customers to use the quantum computing systems through a quantum-computing-as-a-service

(“QCaaS”) platform.

Business Combination

While the legal acquirer in the Merger Agreement is dMY, for financial accounting and reporting purposes under accounting principles generally accepted in the United States of America (“U.S.

GAAP”), Legacy IonQ is the accounting acquirer and the merger is accounted for as a “reverse recapitalization” (i.e., a capital transaction involving the issuance of stock by dMY for the stock of Legacy IonQ).

For accounting purposes, the Business Combination was treated as the equivalent of Legacy IonQ issuing stock for the net assets of dMY, accompanied by a recapitalization.

The net assets of dMY are stated at historical cost, and no goodwill or other intangible assets were recorded.

Because Legacy IonQ was deemed the accounting acquirer in the Business Combination, the historical financial statements of Legacy IonQ are the historical financial statements of the Company upon the consummation of the Business Combination.

As a result, the financial statements included in this report reflect:

(i) the historical operating results of Legacy IonQ prior to the Business Combination;

(ii) the combined results of dMY and Legacy IonQ following the close of the Business Combination on September 30, 2021;

and (iii) the assets and liabilities of Legacy IonQ stated at their historical cost.

In accordance with guidance applicable to these circumstances, the equity structure has been retroactively restated in all comparative periods up to the Closing Date to reflect the number of shares of the Company’s common stock, $ 0.0001 par value per share, issued to Legacy IonQ’s stockholders in connection with the Business Combination.

As such, the shares and corresponding capital amounts and earnings per share related to Legacy IonQ convertible redeemable preferred stock and warrants and Legacy IonQ common stock prior to the Business Combination have been retroactively restated as shares reflecting the exchange ratio established in the Business Combination.

At the Closing Date, the consummation of the Merger provided approximately $ 636.0 million of gross proceeds, including $ 345.0 million from the PIPE investment in common stock at $ 10.00 per share.

In connection with the Business Combination, Legacy IonQ and dMY incurred direct and incremental costs of approximately $ 52 million related to the equity issuance, consisting primarily of banking, legal, accounting, and other professional fees, which were recorded to additional paid-in

capital as a reduction of proceeds.

Additionally, approximately $ 4.3 million in offering costs were allocated to liability-classified warrants assumed in the Merger and expensed upon the close of the Business Combination.

Sponsor Support Agreement

Concurrently with the execution of the Merger Agreement, certain former dMY stockholders entered into a sponsor support agreement.

Under the sponsor support agreement, and effective upon the consummation of the Business Combination, 10 % of the dMY Class B common stock (or 750,000 shares), which were converted into shares of common stock at the consummation of the Business Combination, were unvested and subject to certain vesting and forfeiture provisions (the “Vesting Shares”).

These provisions provide that (i) one-third

of the Vesting Shares shall vest at such time as (x) the closing price of common stock equals or exceeds $12.50 for any 20 trading days during any period of 30 consecutive trading days or (y) IonQ consummates a subsequent transaction (as defined) on or before the date that is five years after the consummation of the Business Combination, (ii) one-third

of the Vesting Shares shall vest at such time as (x) the closing price of common stock equals or exceeds $15.00 for any 20 trading days during any period of 30 consecutive trading days or (y) IonQ consummates a subsequent transaction (as defined), on or before the date that is five years after the consummation of the Business Combination and (iii) one-third

of the Vesting Shares shall vest at such time as (x) the closing price of common stock equals or exceeds $17.50 for any 20 trading days during any period of 30 consecutive trading days or (y) IonQ consummates a subsequent transaction (as defined), on or before the date that is five years after the consummation of the Business Combination.

The Vesting Shares are accounted for as equity classified instruments and were included as merger consideration as part of the reverse recapitalization and recorded in additional paid-in

As of December 31, 2021, all of the Vesting Shares had vested and were released from any restrictions.

Segment Reporting

The Company operates as one operating segment as its chief executive officer, who is the chief operating decision maker, reviews financial information on a consolidated basis for purposes of making operating decisions, allocating resources, and evaluating financial performance.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Preparation

The accompanying consolidated financial statements have been prepared in accordance with U.S.

GAAP as determined by the Financial Accounting Standards Board (“FASB”).

Such consolidated financial statements include the accounts of IonQ and its wholly owned subsidiary.

All intercompany transactions and balances have been eliminated in consolidation.

Emerging Growth Company

The Company is an emerging growth company, as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart

Our Business Startups Act of 2012 (the JOBS Act), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not

limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements,

and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised

financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with

the new or revised financial accounting standards.

The JOBS Act provides that an emerging growth company can elect to opt out of the extended transition period and comply with the requirements

that apply to non-emerging growth companies but any such an election to opt out is irrevocable.

The Company has elected not to opt out of such extended transition period, which

means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or

revised standard.

This may make comparison of the Companys financial statements with another public company that is neither an

emerging growth company nor an emerging growth company that has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Risk and Uncertainties

30, 2020, the World Health Organization (WHO) announced a global health emergency because of a new strain of coronavirus (the COVID-19 outbreak).

In March 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on

the rapid increase in exposure globally.

The full impact of the COVID-19 outbreak continues to evolve.

The impact of the COVID-19 outbreak on the Companys results of operations, financial position and cash flows will depend on future

developments, including the duration and spread of the outbreak and related advisories and restrictions.

These developments and the impact of the COVID-19 outbreak on the financial markets and the overall economy are highly uncertain and cannot be

If the financial markets and/or the overall economy are impacted for an extended period, the Companys results of operations, financial position and cash flows may be materially adversely affected.

Additionally, the Companys

ability to complete an initial Business Combination may be materially adversely affected due to significant governmental measures that have been, and may in the future be, implemented to contain the COVID-19 outbreak or treat its impact, including

travel restrictions, the shutdown of businesses and quarantines, among others, which may limit the Companys ability to have meetings with potential investors or affect the ability of a potential target companys personnel, vendors and

service providers to negotiate and consummate an initial Business Combination in a timely manner.

The Companys ability to consummate an initial Business Combination may also be dependent on the ability to raise additional equity and debt

financing, which may be impacted by the COVID-19 outbreak and the resulting market downturn.

The Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”).

Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act, until such time as those standards apply to private companies.

The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it is (i) no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act.

As a result, the Company’s financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates.

The Company remains an emerging growth company until the earliest of (i) December 31, 2025, (ii) the last day of the fiscal year in which the Company has total annual gross revenue of at least $ 1.07 billion, (iii) the last day of the fiscal year in which the Company is deemed to be a large accelerated filer, which means the market value of the Company’s common stock that is held by non-affiliates

exceeds $ 700.0 million as of the prior June 30th or (iv) the date on which the Company has issued more than $ 1.0 billion in non-convertible

debt securities during the prior three-year period.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported

amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Making estimates requires management to

exercise significant judgment.

It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its

estimate, could change in the near term due to one or more future confirming events.

Actual results could differ from those estimates.

The preparation of financial statements in conformity with U.S.

GAAP and regulations of the U.S.

Securities and Exchange Commission requires management to make estimates and assumptions that affect the amounts reported in these financial statements and accompanying notes.

Significant estimates and judgments are inherent in the analysis and measurement of items including, but not limited to:

revenue recognition, capitalization of internally developed software and quantum computing costs, useful lives of long-lived assets, commitments and contingencies, fair value of available-for-sale

securities, forecasts and assumptions used in determining the fair value of historically granted common stock, stock options and warrants prior to the Business Combination and forecasts and assumptions used in determining the fair value of private placement warrant liabilities.

Management bases its estimates and assumptions on historical experience, expectations, forecasts, and on various other factors that are believed to be reasonable under the circumstances.

Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may differ and be affected by changes in those estimates.

Fair Value Measurements

The Company evaluates the fair value of certain assets and liabilities using the fair value hierarchy.

Fair value is an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

Level 1—Observable inputs, which include quoted prices in active markets;

Level 2—Observable inputs other than the quoted prices in active markets that are observable either directly or indirectly, such as quoted prices in markets that are not active, or other inputs such as broker quotes, benchmark yield curves, credit spreads and market interest rates for similar securities that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities;

Level 3—Unobservable inputs that are supported by little or no market activity and that are based on management’s assumptions, including fair value measurements determined using pricing models, discounted cash flow methodologies or similar techniques.

The Company’s assessment of the significance of a particular input to the fair value measurements requires judgment and may affect the valuation of the assets and liabilities being measured and their placement within the fair value hierarchy.

For assets that are measured using quoted prices in active markets, the total fair value is the published market price per unit multiplied by the number of units held, without consideration of transaction costs.

Assets and liabilities that are measured using significant other observable inputs are primarily valued by reference to quoted prices of similar assets or liabilities in active markets, adjusted for any terms specific to that asset or liability.

Assets and liabilities that are measured at fair value on a non-recurring

basis include property and equipment and intangible assets.

The Company recognizes these items at fair value when they are considered to be impaired or upon initial recognition when acquired through a business combination or an asset acquisition.

The fair value of these assets and liabilities are determined with valuation techniques using the best information available and may include quoted market prices, market comparable and discounted cash flow models.

Due to their short-term nature, the carrying amounts reported in the Company’s financial statements approximates the fair value for cash and cash equivalents, accounts receivable, accounts payable and accrued expenses.

Cash and Cash Equivalents

Cash and cash equivalents include cash in banks, checking deposits and money market funds.

The Company considers all short-term highly liquid investments with an original maturity at the date of purchase of three months or less to be cash equivalents.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are non-interest

bearing and stated at the gross invoiced amount.

A receivable is recorded when the Company has an unconditional right to receive payment based on the satisfaction of performance obligations.

Accounts receivable consists of the following at December 31, 2021 and 2020 (in thousands):

Billed accounts receivable

Unbilled accounts receivable

On a periodic basis, management evaluates its accounts receivable and determines whether to provide an allowance or if any accounts should be written off.

This assessment is based on management’s evaluation of the past due receivables, collectability of specific accounts, historical loss experience and overall economic conditions.

The Company did no t have any allowance for doubtful accounts as of December 31, 2021 and 2020.

Management determines the appropriate classification of investments at the time of purchase based upon management’s intent with regard to such investments.

Investments are classified as available-for-sale

at the time of purchase if they are available to support either current or future operations.

This classification is re-evaluated

at each balance sheet date.

Investments not considered cash equivalents, with remaining contractual maturities of one year or less from the balance sheet date are classified as short-term investments, and those with remaining contractual maturities greater than one year from the balance sheet date are classified as long-term investments.

All investments are recorded at their estimated fair value, and any unrealized gains and losses are recorded in

accumulated other comprehensive income (loss).

Realized gains and losses on sales and maturities of investments are determined based on the specific identification method and are recognized in the consolidated statements of operations in other income (expense), net.

The Company performs periodic evaluations to determine whether any declines in the fair value of investments below cost are other-than-temporary.

The evaluation consists of qualitative and quantitative factors regarding the severity and duration of the unrealized loss, as well as the Company’s ability and intent to hold the investments until a forecasted recovery occurs.

The impairments are considered to be other-than-temporary if they are related to deterioration in credit risk or if it is likely that the underlying securities will be sold prior to a full recovery of their cost basis.

Other-than-temporary fair value impairments are determined based on the specific identification method and are reported in other income (expense), net in the consolidated statements of operations.

Property and Equipment, Net

Property and equipment, net is stated at cost less accumulated depreciation.

Historical cost of fixed assets is the cost as of the date acquired.

Prior to 2019, the Company built certain quantum computing systems solely for research and development purposes and these quantum computing systems were deemed to have no alternative future use.

In 2019, the Company began to commercialize its quantum computing systems via the offering of QCaaS and quantum computing systems built thereafter were determined to provide a probable future economic benefit.

As a result, hardware and labor costs associated with the building of such quantum computing systems were capitalized.

Costs to maintain quantum computing systems are expensed as incurred.

Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the assets.

Useful lives are as follows:

Computer equipment and acquired computer software

Machinery, equipment, furniture and fixtures

Quantum computing systems

Leasehold improvements

Shorter of the lease term or the estimated useful life of the related asset

The Company determines if an arrangement is a lease at inception.

Operating leases are included in operating lease right-of-use

(“ROU”) assets and current operating lease liabilities and operating lease liabilities, net of current portion on our consolidated balance sheets.

As of December 31, 2021, the Company has no financing lease arrangements.

The Company recognizes lease expense for its operating leases on a straight-line basis over the term of the lease.

The Company records a ROU asset and lease liability in connection with its operating leases.

The Company’s lease portfolio is comprised primarily of a real estate lease, which is accounted for as an operating lease.

The Company elected the practical expedient to not separate lease and non-lease

components for all leases.

ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of the future minimum lease payments over the lease term.

Operating lease ROU assets also include the impact of any lease incentives.

Amendments to a lease are assessed to determine if it represents a lease modification or a separate contract.

Lease modifications are reassessed as of the effective date of the modification using an incremental borrowing rate based on the information available at the commencement date.

For modified leases the Company also reassesses the lease classification as of the effective date of the modification.

The interest rate used to determine the present value of the future lease payments is the Company’s incremental borrowing rate, because the interest rate implicit in the Company’s leases is not readily determinable.

The incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located.

The Company’s lease terms include periods under options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.

The Company considers contractual-based factors such as the nature and terms of the renewal or termination, asset-based factors such as physical location of the asset and entity-based factors such as the importance of the leased asset to the Company’s operations to determine the lease term.

The Company generally uses the base, non-cancelable,

lease term when determining the ROU assets and lease liabilities.

Intangible Assets, Net

The Company’s intangible assets include website domain costs, patents, intellectual property and trademarks.

Intangible assets with identifiable useful lives such as patents and intellectual property are initially valued at acquisition cost and are amortized over their estimated useful lives using the straight-line method, which is generally 20 years.

With respect to patents, acquisition costs include external legal and patent application costs.

Intangible assets with indefinite useful lives are assessed for impairment at least annually.

Capitalized Internally Developed Software

Capitalized internally developed software, which is included in intangible assets, net, consists of costs to purchase and develop internal-use

software, which the Company uses to provide services to its customers.

The costs to purchase and develop internal-use

software are capitalized from the time that the preliminary project stage is completed, and it is considered probable that the software will be used to perform the function intended, until the time the software is placed in service for its intended use.

Any costs incurred during subsequent efforts to upgrade and enhance the functionality of the software are also capitalized.

Once this software is ready for use as part of the Company’s service offerings, these costs are amortized on a straight-line basis over the estimated useful life of the software, which is typically assessed to be 3 years.

During the years ended December 31, 2021 and 2020, the Company capitalized $ 1.7 million and $ 1.2 million in internal-use

software costs, respectively.

The Company amortized $ 0.8 million sand and $ 0.3 million of capitalized internally developed software costs during the years ended December 31, 2021 and 2020, respectively.

Impairment of Long-Lived Assets

Long-lived assets, such as property and equipment and other long-term assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

If circumstances require a long-lived asset or asset group be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount.

If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent the carrying amount of the underlying asset exceeds its fair value.

No impairment loss was recognized for the years ended December 31, 2021 or 2020.

Early Exercise of Stock Options

Stock options granted under the 2015 Equity Incentive Plan provide employee option holders, if approved by the Board, the right to exercise unvested options in exchange for restricted common stock, which is subject to a repurchase right held by the Company at the lower of (i) the fair market value of its common stock on the date of repurchase or (ii) the original purchase price.

Early exercises of options are not deemed to be substantive exercises for accounting purposes and accordingly, amounts received for early exercises are recorded as a liability.

These amounts are reclassified to common stock and additional paid-in capital as the underlying shares vest.

Warrant Liabilities

The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and Hedging.” For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value on the grant date and is then re-valued

upon exercise or at each reporting date for the unexercised warrants, with changes in the fair value reported in the consolidated statements of operations.

The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period.

The warrants of dMY assumed in the Business Combination are classified as liabilities and remeasured at each reporting period (as more fully described in Note 12).

The determination of the fair value of the warrant liabilities may be subject to change as more current information becomes available and accordingly the actual results could differ significantly.

Derivative warrant liabilities are classified as non-current liabilities as

their liquidation is not reasonably expected to require the use of current assets or require the creation of current liabilities.

Revenue Recognition

The Company derives revenue from providing access to its QCaaS and professional services related to co-developing

algorithms on the quantum computing systems.

The Company applies the provisions of the FASB Accounting Standards Update (“ASU”), Revenue from Contracts with Customers (“ASC 606”), and all related applicable guidance.

The core principle of ASC 606 is that an entity shall recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

To support this core principle, the Company applies the following five step approach:

Identify the contract with the customer

Identify the performance obligations

Determine the transaction price

Allocate the transaction price to the performance obligations

Recognize revenue when (or as) the entity satisfies a performance obligation

The Company has determined that its QCaaS contracts represent a combined, stand-ready performance obligation to provide access to its quantum computing systems together with related maintenance and support.

The transaction price generally includes a variable fee based on usage of its quantum computing systems and may include a fixed fee for a minimum volume of usage to be made available over a defined period of access.

Fixed fee arrangements may also include a variable component whereby customers pay an amount for usage over contractual minimums contained in the contracts.

For contracts with a fixed transaction price, the fixed fee is recognized as QCaaS subscription-based revenues on a straight-line basis over the access period.

For contracts without fixed fees, variable usage fees are billed and recognized during the period of such usage.

As of December 31, 2021 and 2020, all of the revenue recognized by the Company was recognized based on transfer of service over time.

There were no revenues recognized at a point in time.

In arrangements with cloud service providers, the cloud service provider is considered the customer and IonQ does not have any contractual relationships with the cloud service providers’ end users.

For these arrangements, revenue is recognized at the amount charged to the cloud service provider and does not reflect any mark-up

to the end user.

The Company may enter into multiple contracts with a single counterparty at or near the same time.

The Company will combine contracts and account for them as a single contract when one or more of the following criteria are met:

(i) the contracts are negotiated as a package with a single commercial objective;

(ii) consideration to be paid in one contract depends on the price or performance of the other contract;

and (iii) goods or services promised are a single performance obligation.

The Company has entered into one revenue

arrangement in which it granted warrants to the counterparty.

Refer to Note 11—Warrant Transaction Agreement for further information on the customer warrants.

Billed and unbilled accounts receivable relate to the Company’s rights to consideration as performance obligations are satisfied when the rights to payment become unconditional but for the passage of time.

The variable fees associated with the QCaaS are generally billed a month in arrears.

Customers also have the ability to make advance payments.

If a contract exists under ASC 606, advance payments are recorded as a contract liability until services are delivered or obligations are met and revenue is earned.

Contract liabilities to be recognized in the succeeding 12-month

period are classified as current and the remaining amounts are classified as non-current

liabilities in the Company’s consolidated balance sheets.

As of December 31, 2021, approximately $ 22.1 million of revenue is expected to be recognized from remaining performance obligations that are unsatisfied (or partially unsatisfied) for non-cancelable

The Company expects to recognize revenue of $ 7.2 million, $6.7 million and $5.2 million related to these remaining performance obligations in the years ended December 31, 2022, 2023 and 2024, respectively, with the remainder recognized thereafter.

The Company has not estimated the timing of revenue recognition for the remaining unsatisfied performance obligations related to usage-based contracts as the timing of customer usage cannot be predicted given the limited historical data.

Total deferred revenues, including both current and noncurrent, were $5.0 million and $1.4 million at December 31, 2021 and 2020, respectively.

The change in deferred revenue for the year ended December 31, 2021 was primarily due to cash payments received for which the performance obligation was not satisfied prior to the end of the period, partially offset by revenue recognized during the period, of which $0.2 million was included in the deferred revenue balance at December 31, 2020 .

For contractual arrangements where consideration is paid up-front,

the transfer of the quantum computing services is completed at the discretion of the customer as the customer chooses to use the services starting from the date of contract inception.

As such, the up-front

payment of consideration does not represent a significant financing component.

Cost to Obtain a Contract

Applying the practical expedient, the Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets is one year or less.

For the years ended December 31, 2021 and 2020, the Company has not incurred any material incremental costs of obtaining contracts.

Cost of Revenue

Cost of revenue primarily consists of expenses related to delivering the Company’s services, including direct labor costs, direct service costs and allocated shared resources.

Cost of revenue excludes depreciation and amortization related to the Company’s quantum computing systems and related software.

Research and Development

Research and development expenses consist of personnel costs, including stock-based compensation expense, and allocated shared resource costs for the Company’s hardware, software and engineering personnel who design and develop the Company’s quantum computing systems and research new quantum computing technologies.

Unlike a standard computer, design and development efforts continue throughout the useful life of the Company’s quantum computing systems to ensure proper calibration and optimal functionality.

Research and development expenses also include purchased hardware and software costs related to quantum computing

systems constructed for research purposes that are not probable of providing future economic benefit and have no alternate future use.

In December 2020, the Company amended its option agreement with Duke University (“Duke”), and under this amendment, the Company issued common shares to Duke in consideration for research and development services through July 15, 2026.

The amended arrangement is considered a research and development service arrangement and recorded as a prepayment based on the fair value of the common stock issued on the effective date of the amendment and amortized over the term of the arrangement as services are received.

In February 2021, the Company and the University of Maryland (“UMD”) amended the option agreement with UMD pursuant to which the Company issued shares of common stock to UMD as a nonrefundable upfront payment in exchange for research and development services by UMD and rights to any potential future intellectual property developed through July 2021.

See Note 7—Agreements with UMD and Duke for further information.

Advertising Costs

Advertising costs are expensed as incurred and are included in sales and marketing expenses in the consolidated statements of operations.

These costs were $ 1.1 million and $ 0.4 million for the years ended December 31, 2021 and 2020, respectively.

Stock-Based Compensation

The Company measures and records the expense related to stock-based awards based on the fair value of those awards as determined on the date of grant.

The Company recognizes stock-based compensation expense over the requisite service period of the individual grant, generally equal to the vesting period and uses the straight-line method to recognize stock-based compensation.

The Company uses the Black-Scholes-Merton (“Black- Scholes”) option-pricing model to determine the fair value of stock awards and the estimated fair value for stock options.

The Black-Scholes option- pricing model requires the use of subjective assumptions, which determine the fair value of share-based awards, including the fair value of the Company’s common stock, the option’s expected term, the price volatility of the underlying common stock, risk-free interest rates, and the expected dividend yield of the common stock.

The assumptions used to determine the fair value of the stock awards represent management’s best estimates.

These estimates involve inherent uncertainties and the application of management’s judgment.

The Company records forfeitures as they occur.

The Company obtained third-party valuations to estimate the fair value of its common stock for awards granted prior to the Business Combination, for purposes of measuring stock-based compensation expense.

The third-party valuations were prepared using methodologies, approaches, and assumptions consistent with the American Institute of Certified Public Accountants (“AICPA”) Accounting & Valuation Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation.

Income taxes are accounted for using the asset and liability method.

Deferred income taxes are provided for temporary differences in recognizing certain income, expense and credit items for financial reporting purposes and tax reporting purposes.

Such deferred income taxes primarily relate to the difference between the tax bases of assets and liabilities and their financial reporting amounts.

Deferred tax assets and liabilities are measured by applying enacted statutory tax rates applicable to the future years in which deferred tax assets or liabilities are

expected to be settled or realized.

Excess tax benefits or tax deficiencies from stock option exercises are recognized in the income tax provision in the period in which they occur.

The Company records a valuation allowance when it determines, based on available positive and negative evidence, that it is more-likely-than-

that some portion or all of its deferred tax assets will not be realized.

The Company determines the realizability of its deferred tax assets primarily based on the reversal of existing taxable temporary differences and projections of future taxable income (exclusive of reversing temporary differences and carryforwards).

In evaluating such projections, the Company considers its history of profitability, the competitive environment, and general economic conditions.

In addition, the Company considers the time frame over which it would take to utilize the deferred tax assets prior to their expiration.

For certain tax positions, the Company uses a more-likely-than-not

threshold based on the technical merits of the tax position taken.

Tax positions that meet the more-likely-than-not

recognition threshold are measured at the largest amount of tax benefits determined on a cumulative probability basis, which are more-likely-than-not

to be realized upon ultimate settlement in the financial statements.

The Company’s policy is to recognize interest and penalties related to income tax matters in income tax expense.

However, there were no amounts recognized relating to interest and penalties in the consolidated statements of operations for the years ended December 31, 2021 and 2020.

The Company had no uncertain income tax positions as of December 31,2021 and 2020.

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash, cash equivalents, investments, and trade accounts receivable.

The Company maintains the majority of its cash, cash equivalents and investments with two financial institutions, both of which management believes to be financially sound and with minimal credit risk.

The Company’s deposits periodically exceed amounts guaranteed by the Federal Deposit Insurance Corporation.

The Company’s accounts receivable are derived from customers primarily located in the U.S.

The Company performs periodic evaluations of its customers’ financial condition and generally does not require its customers to provide collateral or other security to support accounts receivable and maintains an allowance for doubtful accounts.

Credit losses historically have not been material.

Significant customers are those which represent more than 10 %

of the Company’s total revenue or gross accounts receivable.

The Company’s revenue was primarily from two significant customers for the year ended December 31, 2021.

While we generated revenue in 2020, we executed an arrangement with a customer for the issuance of a warrant to purchase shares of Legacy IonQ Series B-1 convertible redeemable preferred stock.

The warrant was evaluated and considered to represent consideration provided to a customer and as such, the recognition of the warrant expense is recorded as a reduction in revenue as revenue is earned under the contract.

Other than this customer, the Company did not have any other significant customers for the year ended December 31, 2020.

The Company’s accounts receivable was from two significant customers as of December 31, 2021 and 2020.

Earnings (Loss) Per Share

Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding for the period.

Diluted earnings per share is computed by dividing net income (loss) by the weighted average number of shares of common stock during the period, plus common stock equivalents, outstanding during the period.

If the Company reports a net loss, the computation of diluted loss per share excludes the effect of dilutive common stock equivalents, as their effect would be antidilutive.

Earnings (loss) per share calculations for all periods have been retroactively restated to reflect the conversion of the Company’s convertible redeemable preferred stock and the equivalent number of shares reflecting the exchange ratio established in the reverse capitalization.

The following table sets forth the computation of basic and diluted loss per share attributable to common stockholders (in thousands, except share and per share data):

Year Ended December 31,

Net loss attributable to common stockholders

Weighted average shares used in computing net loss per share attributable to common stockholders—basic and diluted

Net loss per share attributable to common stockholders—basic and diluted

In periods with a reported net loss, the effect of anti-dilutive stock options, unvested common stock (including unvested restricted common stock) and warrants are excluded and diluted loss per share is equal to basic loss per share.

The following is a summary of the weighted average common stock equivalents for the securities outstanding during the respective periods that have been excluded from the computation of diluted net loss per common share, as their effect would be anti-dilutive:

Year Ended December 31

Common stock options outstanding

Warrants to purchase common stock

Unvested common stock

Public and private warrants

Unvested founders’ shares

Recently Adopted Accounting Pronouncements

In August 2018, the FASB issued ASU 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40):

Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.

ASU 2018-15 requires a customer in a cloud computing arrangement that is a service contract to follow the internal-use software guidance in ASC 350-40 to determine which implementation costs to defer and recognize as an asset.

The guidance is effective for annual reporting periods beginning after December 15, 2020, and interim periods within annual periods beginning after December 15, 2021.

The Company adopted this standard effective January 1, 2021 prospectively to all new implementation costs incurred after adoption.

The adoption of this standard had no material impact on the Company’s consolidated financial statements and related disclosures.

Recently Issued Accounting Standards Not Yet Adopted

In June 2016, the FASB issued ASU 2016-13,

Financial Instruments—Credit Losses, along with various updates and improvements.

The standard, including subsequently issued amendments, requires a financial asset measured at amortized cost basis, such as accounts receivable and certain other financial assets, to be presented at the net amount expected to be collected based on relevant information about past events, including historical experience, current conditions and reasonable and supportable forecasts that affect the collectability of the reported amount.

is effective for annual reporting periods beginning after December 15, 2022, with early adoption permitted.

Based on the composition of the Company’s trade receivables and other financial assets, current market conditions and historical credit loss activity, the adoption of this standard is not expected to have a material impact on the Company’s financial statements and related disclosures.

In August 2020, the FASB issued ASU 2020-06,

Debt, Debt with Conversion and Other Options (Subtopic 470-20)

and Derivatives and Hedging Contracts in Entity’s Own Equity (Subtopic 815-40)

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.

The ASU simplifies accounting for convertible instruments by removing major separation models required under current U.S.

Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features.

The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for the exception.

The ASU also simplifies the diluted net income per share calculation in certain areas.

The new guidance is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years, and early adoption is permitted.

The Company does not expect adoption of this guidance to have a material impact on its consolidated financial statements and related disclosures.

CASH EQUIVALENTS AND INVESTMENTS

The following table summarizes the Company’s unrealized gains and losses and estimated fair value of cash equivalents and investments in available-for-sale

securities recorded in the consolidated balance sheets (in thousands):

AS OF DECEMBER 31, 2021

AS OF DECEMBER 31, 2020

Money market funds

Commercial paper

Corporate notes and bonds

Municipal bonds

US government and agency

Total cash equivalents and investments

Unrealized losses related to investments were primarily a result of interest rate fluctuations, and none of the investments held as of December 31, 2021 have been in a continuous unrealized loss position for greater than one year.

As of December 31, 2021, the Company did not consider any of its available-for-sale

investments to be other-than-temporarily impaired nor does the Company intend, or believe it is more likely than not, that it will be required to sell the investments in an unrealized loss position before the recovery of the associated amortized cost basis.

The estimated fair value of the Company’s cash equivalents and investments in available-for-sale

securities as of December 31, 2021, aggregated by investment category and classified by contractual maturity date, is as follows (in thousands):

1 Year or Less

1 Year or Greater

Money market funds

Commercial paper

Corporate notes and bonds

Municipal bonds

US government and agency

FAIR VALUE MEASUREMENTS

The Company’s financial assets and liabilities subject to fair value measurements on a recurring basis and the level of inputs used for such measurements were as follows (in thousands):

Fair Value Measured as of

December 31, 2021:

Cash equivalents:

The Company considers all short-term investments with an original maturity of three months or less when purchased

to be cash equivalents.

The Company did not have any cash equivalents as of December 31, 2020.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentration of credit risk consist of cash accounts in a financial institution

which, at times, may exceed the Federal depository insurance coverage of $250,000, and investments held in Trust Account.

The Company has not experienced losses on these accounts and management believes the Company is not exposed to significant

risks on such accounts.

Investments Held in the Trust Account

The Companys portfolio of investments is comprised solely of U.S.

government securities, within the meaning set forth in

Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less, or investments in money market funds that invest in U.S.

government securities, or a combination thereof.

The Companys investments held in the Trust

Account are classified as trading securities.

Trading securities are presented on the balance sheet at fair value at the end of each reporting period.

Gains and losses resulting from the change in fair value of these securities is included in gain

on marketable securities (net), dividends and interest held in Trust Account in the accompanying statement of operations.

The estimated fair values of investments held in the Trust Account are determined using available market information.

Fair Value of Financial Instruments

Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction

between market participants at the measurement date.

GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value.

The hierarchy gives the highest priority to unadjusted quoted prices in active

markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

These tiers include:

Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active

Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly

observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active;

Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an

entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy.

those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement.

As of December 31, 2020, the carrying values of cash, accounts payable, accrued expenses franchise tax payable, and note payable to

related parties approximate their fair values due to the short-term nature of the instruments.

The Companys investments held in Trust Account are comprised of investments in U.S.

Treasury securities with an original maturity of 185

The fair value of investments held in Trust Account is determined using quoted prices in active markets.

Offering Costs Associated with

the Initial Public Offering

The Company complies with the requirements of the FASB ASC Topic 340-10-S99-1 and SEC Staff Accounting Bulletin Topic 5A Expenses of Offering. Offering costs consist of costs incurred in connection with the

formation and preparation for the Initial Public Offering.

These costs, together with the underwriting discount, were charged to additional paid-in capital upon the completion of the Initial Public Offering.

Class A Common Stock Subject to Possible Redemption

The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in FASB ASC Topic 480

Distinguishing Liabilities from Equity. Shares of Class A common stock subject to mandatory redemption (if any) are classified as liability instruments and are measured at fair value.

Shares of conditionally redeemable Class A

common stock (including Class A common stock that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Companys control) are

classified as temporary equity.

At all other times, shares of Class A common stock are classified as stockholders equity.

The Companys Class A common stock features certain redemption rights that are considered to be outside of

the Companys control and subject to the occurrence of uncertain future events.

Accordingly, as of December 31, 2020, 28,541,813 shares of Class A common stock subject to possible redemption are presented as temporary equity, outside

of the stockholders equity section of the Companys balance sheet.

Net Loss Per Common Share

Net loss per share of common stock is computed by dividing net loss applicable to stockholders by the weighted average number of shares of

common stock outstanding during the periods.

The Company has not considered the effect of the warrants sold in the Initial Public Offering and Private Placement to purchase an aggregate of 11,500,000 shares of Class A common stock in the

calculation of diluted earnings per share, since their inclusion would be anti-dilutive under the treasury stock method.

As a result, diluted earnings per share is the same as basic earnings per share for the periods presented.

The Companys statement of operations includes a presentation of income per share for

common stock subject to redemption in a manner similar to the two-class method of income per share.

Net income per share, basic and diluted for Class A common stock is calculated by

dividing the net gain from investments held in the Trust Account of approximately $31,000, net of applicable franchise taxes of approximately $31,000 for the period from September 14, 2020 (inception) through December 31, 2020, by the

weighted average number of shares of Class A common stock outstanding for the period.

Net loss per share, basic and diluted for Class B common stock for the period from September 14, 2020 (inception) through December 31, 2020 is

calculated by dividing the general and administration expenses of approximately $602,000 and franchise taxes of approximately $27,000, resulting in a net loss of approximately $629,000, by the weighted average number of Class B common stock

outstanding for the period.

The Company complies with the accounting and reporting requirements of Financial Accounting Standards Board Accounting Standard Codification,

or FASB ASC Topic 740, Income Taxes, which requires an asset and liability approach to financial accounting and reporting for income taxes.

Deferred tax assets and liabilities are recognized for the estimated future tax consequences

attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable

income in the years in which those temporary differences are expected to be recovered or settled.

The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date.

Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

FASB ASC Topic

740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return.

For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities.

The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense.

Recent Accounting Pronouncements

Management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have an

effect on the Companys financial statements.

Note 3 Initial Public Offering

On November 17, 2020, the Company consummated its Initial Public Offering of 30,000,000 Units, including the 2,500,000 Over-Allotment

Units, at $10.00 per Unit, generating gross proceeds of $300.00 million, and incurring offering costs of approximately $16.96 million, inclusive of $10.50 million in deferred underwriting commissions.

Each Unit consists of one share of

Class A common stock, and one-fourth of one redeemable warrant (each, a Public Warrant).

Each Public Warrant entitles the holder to purchase one

share of Class A common stock at a price of $11.50 per share, subject to adjustment (see Note 6).

Note 4 Related Party Transactions

Founder Shares

September 14, 2020, the Sponsor subscribed for 7,187,500 shares of the Companys Class B common stock, par value $0.0001 per share, (the Founder Shares) for a total subscription price of $25,000, and fully paid for these

on November 17, 2020.

In October 2020, the Sponsor transferred 25,000 Founder Shares to each of Darla Anderson, Francesca Luthi and Charles E.

Wert, the Companys director nominees.

On November 12, 2020, the Company effected a 1:1.1

stock split of the Class B common stock, resulting in an aggregate of 7,906,250 shares outstanding.

All shares and associated amounts have been retroactively restated to reflect the stock split.

The initial stockholders agreed to forfeit up to 1,031,250 Founder Shares to the extent that the over-allotment option is not exercised in

full by the underwriters, so that the Founder Shares will represent 20.0% of the Companys issued and outstanding shares after the Initial Public Offering.

On November 17, 2020, the underwriters partially exercised their over-allotment

option to purchase 2,500,000 units resulting in 625,000 shares of Class B common stock no longer being subject to forfeiture.

The over-allotment option expired on December 27, 2020, resulting in 406,250 shares of Class B common stock

being forfeited.

The initial stockholders agreed, subject to limited exceptions, not to transfer, assign or

sell any of the Founder Shares until the earlier to occur of:

(A) one year after the completion of the initial Business Combination or earlier if, subsequent to the initial Business Combination, the closing price of the Class A common

stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period

commencing at least 150 days after the initial Business Combination and (B) the date following the completion of the initial Business Combination on which the Company completes a liquidation, merger, capital stock exchange or other similar

transaction that results in all of the stockholders having the right to exchange their Class A common stock for cash, securities or other property.

Private Placement Warrants

Simultaneously with the closing of the Initial Public Offering, the Company consummated the Private Placement of 4,000,000 Private Placement

Warrants at a price of $2.00 per Private Placement Warrant to the Sponsor, generating gross proceeds of $8.0 million.

Private Placement Warrant is exercisable for one whole share of Class A common stock at a price of $11.50 per share.

A portion of the proceeds from the sale of the Private Placement Warrants to the Sponsor was added to the proceeds from the

Initial Public Offering held in the Trust Account.

If the Company does not complete a Business Combination within the Combination Period, the Private Placement Warrants will expire worthless.

The Private Placement Warrants will be non-redeemable for cash and exercisable on a cashless basis so long as they are held by the Sponsor or its permitted transferees.

The Sponsor and the Companys officers and directors agreed, subject to limited exceptions, not to transfer, assign or sell any of their

Private Placement Warrants until 30 days after the completion of the initial Business Combination.

Related Party Loans

On September 14, 2020, the Sponsor agreed to loan the Company an aggregate of up to $200,000 to cover expenses related to the Initial

Public Offering pursuant to a promissory note (the Note).

This loan was non-interest bearing and payable upon the completion of the Initial Public Offering.

The Company borrowed an aggregate of

approximately $121,000 under the Note.

On December 21, 2020, the Company repaid approximately $90,000 of the outstanding Note balance.

addition, in order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Companys officers and directors may, but are not obligated to, loan the Company funds as

may be required (Working Capital Loans).

If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company.

Otherwise, the Working Capital

Loans would be repaid only out of funds held outside the Trust Account.

In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no

proceeds held in the Trust Account would be used to repay the Working Capital Loans.

Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans.

Working Capital Loans would either be repaid upon consummation of a Business Combination or, at the lenders discretion, up to $1.5 million of such Working Capital Loans may be convertible into warrants of the post Business Combination

entity at a price of $2.00 per warrant.

The warrants would be identical to the Private Placement Warrants.

To date, the Company had no borrowings under the Working Capital Loans.

Administrative Services Agreement

Company entered into an agreement that will provide that, commencing on the date that the Companys securities are first listed on New York Stock Exchange and continuing until the earlier of the Companys consummation of a Business

Combination and the Companys liquidation, the Company pays the Sponsor a total of $10,000 per month for office space, secretarial and administrative services provided to members of the Companys management team.

The Sponsor, executive officers and directors, or any of their respective affiliates will be

reimbursed for any out-of-pocket expenses incurred in connection with activities on the Companys behalf such as identifying potential target businesses and

performing due diligence on suitable business combinations.

The Companys audit committee will review on a quarterly basis all payments that were made to the Sponsor, executive officers or directors, or the Companys or their affiliates.

Note 5 Commitments & Contingencies

Registration Rights

The holders of

Founder Shares, Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans, if any, (and any shares of Class A common stock issuable upon the exercise of the Private Placement Warrants and warrants that

may be issued upon conversion of Working Capital Loans and upon conversion of the Founder Shares) are entitled to registration rights pursuant to a registration rights agreement.

These holders will be entitled to certain demand and

piggyback registration rights.

The Company will bear the expenses incurred in connection with the filing of any such registration statements.

Underwriting Agreement

The underwriters

were entitled to an underwriting discount of $0.20 per unit, or $6.00 million in the aggregate, paid upon the closing of the Initial Public Offering.

In addition, $0.35 per unit, or approximately $10.50 million in the aggregate will be

payable to the underwriters for deferred underwriting commissions.

The deferred fee will become payable to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes a Business Combination, subject to

the terms of the underwriting agreement.

On January 12, 2021, the Company, the Sponsor accepted service of a lawsuit where they are named as Counterclaim Defendants in an

underlying action by and between GTY Technology Holdings, Inc.

Money market funds (1)

Commercial paper

US government and agency

Total cash equivalents

Short-term investments:

Commercial paper

Corporate notes and bonds

Municipal bonds

US government and agency

Total short-term investments

Long-term investments

Corporate notes and bonds

US government and agency

Total long-term investments

Public warrants

Fair Value Measured as of

December 31, 2020:

Cash and cash equivalents (1)

Includes money market funds associated with the Company’s overnight investment sweep account.

The Company’s warrant liabilities are comprised of the public warrants.

The private placement warrants were fully exercised as of December 31, 2021.

Refer to Note 12 – Warrant Liabilities for further information.

Transfers to/from Levels 1, 2 and 3 are recognized at the beginning of the reporting period.

There were no transfers between levels during the period.

As of December 31, 2021, the public warrants were publicly traded

at $ 6.49 per warrant.

The private placement warrants were marked to fair value on the date of exercise.

The fair value of the private placement warrants was determined using Level 3 inputs.

Management determined the fair value of the private placement warrants using unobservable inputs in the Black-Scholes valuation model.

Inherent in the valuation were assumptions related to expected stock-price volatility, expected term, risk-free interest rate and dividend yield.

The Company estimated the volatility of its common stock warrants based on implied volatility from the Company’s traded warrants and from historical volatility of select peer company’s common stock that matches the expected remaining life of the warrants.

The risk-free interest rate was based on the U.S.

Treasury zero-coupon

yield curve on the grant date for a maturity similar to the expected remaining life of the warrants.

The expected life of the warrants was assumed to be equivalent to their remaining contractual term.

The dividend rate was based on the historical rate, which the Company anticipates remaining at zero.

The following table provides quantitative information regarding Level 3 fair value measurement inputs for the private placement warrants as of the date the private placement warrants were exercised.

Exercise price

Risk-free rate

Dividend yield

The Company did not have any Level 3 assets or liabilities as of December 31, 2021 as the private placement warrants were fully exercised.

A rollforward of the fair value of the private placement warrants is as follows (in thousands):

Fair value as of December 31, 2020

Assumed as part of the Business Combination

Change in valuation inputs

Exercise of private placement warrants

Fair Value as of December 31, 2021

PROPERTY AND EQUIPMENT, NET

Property and equipment, net as of December 31, 2021 and 2020, are composed of the following (in thousands):

Computer equipment and acquired computer software

Machinery, equipment, furniture and fixtures

Leasehold improvements

Quantum computing systems

Gross property and equipment

accumulated depreciation

Net property and equipment

Depreciation expense for the years ended December 31, 2021 and 2020 was $ 1.7 million and $ 1.1 million, respectively.

INTANGIBLE ASSETS, NET

Intangible assets as of December 31, 2021 and 2020 are composed of the following (in thousands):

December 31, 2021

Website and other

Internally developed software

December 31, 2020

Website and other

Internally developed software

Total amortization expense for intangible assets for the years ended December 31, 2021 and 2020 was $ 0.8 million and $ 0.3 million, respectively.

As of December 31, 2021, the projected annual amortization expense for the Company’s intangible assets is as follows (in thousands):

Year ending December 31,

AGREEMENTS WITH UMD AND DUKE

Exclusive License Agreement

The Company entered into an exclusive license agreement (“License Agreement”) in 2016 with UMD and Duke.

The License Agreement grants to the Company an exclusive, perpetual license (“Initial Patents”) to certain patents, know-how

and other intellectual property utilized in trapped-ion

quantum computing systems.

The license granted to the Company is exclusive for all patents (and non-exclusive

for other types of intellectual property), subject to certain governmental rights and retained rights by UMD and Duke and other non-profit

institutions to use and practice the Licensed Patents (as defined below) and technology for internal research and other non-profit

In exchange for the Initial Patents, UMD and Duke received an aggregate of 142,886 common shares after giving effect to the recapitalization.

On February 1, 2021, the Company and UMD executed two amendments to the License Agreement granting exclusive rights to license additional intellectual property in exchange for a total of 257,198 common shares after

giving effect to the recapitalization.

Management evaluated the amendments and concluded that the arrangements qualify as equity-classified instruments and recorded an intangible asset and additional paid-in

capital based on the fair value of the shares at the date the amendments were executed of $ 1.6 million.

The shares for each executed amendment were issued during the year ended December 31, 2021.

Exclusive Option Agreements

The Company also entered into an exclusive option agreement (“Option Agreement”) with each of UMD and Duke in 2016 whereby on the anniversary of the effective date of the License Agreement for a period of 5 years, the Company has the right to acquire additional intellectual property developed by UMD and Duke (the “Additional Patents” and together with the Initial Patents, the “Licensed Patents”) by exercising an annual option and issuing common shares each to Duke and UMD in consideration for the Additional Patents.

The amount issued to UMD and Duke pursuant to the option over the 5 -year

s equal to an aggregate of 642,995 common shares to each university after giving effect to the recapitalization.

The Company may elect not to exercise the option if there was not a minimum number of intellectual property developed in a given year and then the Option Agreement would extend another year .

In December 2020, the Company amended its option agreement with Duke, and under this amendment, the Company issued 1,214,317 common shares after giving effect to the recapitalization, to Duke in consideration for research and development services through July 15, 2026.

Under the terms of the amended Option Agreement, the issuance of shares is a nonrefundable upfront payment in exchange for research and development services by Duke whereby the Company will obtain rights to any potential future intellectual property developed during the term.

As such, the fair value of the shares of common stock issued to Duke of $ 2.9 million was recorded as a prepaid expense and is being amortized over the term of the arrangement as services are received.

The Company recognized $ 0.5 million and $ 19 thousand of research and development expense related to the agreement with Duke during the years ended December 31, 2021 and 2020 ,

respectively.

In February 2021, the Company and UMD amended the UMD Option Agreement pursuant to which the Company issued the remaining 128,599 shares of common stock after giving effect to the recapitalization to UMD as a nonrefundable upfront payment in exchange for research and development services by UMD and rights to any potential future intellectual property developed through July 2021.

The fair value of the shares issued to UMD was $ 0.8 million.

The Company recognized $ 0.8 million of research and development expense associated with the UMD Option Agreement amendment for the year

ended December 31, 2021.

The UMD Option Agreement was not executed as of December 31, 2020 and therefore no research and development expense was recognized for the ye a

ended December 31, 2020.

Additionally, under the terms of the License Agreement and Option Agreement, UMD and Duke were provided an exit guarantee if a sale or liquidation of the Company would occur that provides for the following:

acceleration of the issuance of common stock as if exercised through the License Agreement,

additional consideration equal to the consideration which a holder of one-half

of one percent ( 0.5 %) of the common stock of the Company, on a fully-diluted basis, would have received in the sale to the extent it exceeds the amount UMD and Duke shall be entitled to as a result of ownership at the time of sale.

In December 2020, the Company and Duke amended the Duke Option Agreement to remove the exit guarantee.

Additionally, the exit guarantee with UMD lapsed as a result of the Business Combination in September 2021.

The useful life of the Licensed Patents derived from the License Agreement and the Option Agreement is the remaining legal life at the time of acquisition.

The value of the Licensed Patents is based on the fair value of the common stock given as consideration on the effective date of each agreement and exercise of option.

The asset is amortized over the useful life of the Licensed Patents.

ACCRUED EXPENSES

Accrued expenses as of December 31, 2021 and 2020 are composed of the following (in thousands):

Accrued salaries and other payroll liabilities

Accrued accounting and tax liabilities

Accrued expenses - other

Total accrued expenses

COMMITMENTS AND CONTINGENCIES

Warranties and Indemnification

The Company’s commercial services are typically warranted to perform in a manner consistent with general industry standards that are reasonably applicable and materially in accordance with the Company’s documentation under normal use and circumstances.

The Company’s arrangements generally include certain provisions for indemnifying customers against liabilities if its products or services infringe third- party intellectual property rights.

To date, the Company has not incurred any material costs as a result of such obligations and has not accrued any liabilities related to such obligations in the accompanying financial statements.

On January 12, 2021, dMY Technology Group, Inc.

II, dMY Sponsor II, LLC, dMY, and dMY Sponsor III, LLC (“Sponsor”) accepted service of a lawsuit where they were named as counterclaim defendants in an underlying action by and between GTY Technology Holdings, Inc.

(“GTY”), dMY Technology Holdings Inc., dMY Sponsor, LLC, dMY Sponsor II, LLC, dMY Technology Group Inc.

II, the Company and the Sponsor (collectively dMY) and

Carter Glatt (Glatt) and Captains Neck Holdings LLC (Captains Neck).

The Underlying Lawsuit seeks a declaratory judgment that Glatt and Captains Neck are not entitled to Class Y Units of dMY Sponsor LLC and contains

claims arising from Glatts termination of employment from GTY on or about April 3, 2020 including theft and misappropriation of confidential GTY information, breach of contract, breach of the duties of loyalty and fiduciary duty and

Glatt has, among other things, responded to the Underlying Lawsuit by adding members of the Sponsor and officers of the Company as Counterclaim Defendants and adding Dune Acquisition Holdings LLC, a newly formed special purpose

acquisition company as a Counterclaimant and asserting claims for breach of contract, fraudulent misrepresentation, negligent misrepresentation, tortious interference with business relations, quantum meruit and unjust enrichment.

The Company has

never employed Glatt and has no business agreements with him.

The Company has denied the claims against them and management intends to vigorously defend the Company.

Note 6 Stockholders Equity

Class A Common Stock The Company is authorized to issue 380,000,000 shares of Class A common stock with a

par value of $0.0001 per share.

As of December 31, 2020, there were 30,000,000 shares Class A common stock outstanding, including 28,541,813 shares of Class A common stock subject to possible conversion that were classified as

temporary equity in the accompanying balance sheet.

Class B Common Stock The Company is authorized to

issue 20,000,000 shares of Class B common stock with a par value of $0.0001 per share.

On November 17, 2020, the Company issued 7,187,500 shares of Class B common stock.

On November 12, 2020, the Company effected a 1:1.1 stock

split of the Class B common stock,

resulting in an aggregate of 7,906,250 shares outstanding.

All shares and associated amounts have been retroactively restated to reflect the stock split.

Of the 7,906,250 shares of Class B

common stock outstanding, an aggregate of up to 1,031,250 shares of Class B common stock that are subject to forfeiture, to the Company by the initial stockholders for no consideration to the extent that the underwriters over-allotment

option is not exercised in full or in part, so that the initial stockholders will collectively own 20% of the Companys issued and outstanding common stock after the Initial Public Offering.

On November 17, 2020, the underwriters partially

exercised their over-allotment option to purchase 2,500,000 units resulting in 625,000 shares of Class B common stock no longer being subject to forfeiture.

The over-allotment option expired on December 27, 2020, resulting in 406,250

shares of Class B common stock being forfeited.

Stockholders of record are entitled to one vote for each share held on all matters

to be voted on by stockholders.

Holders of Class A common stock and holders of Class B common stock will vote together as a single class on all matters submitted to a vote of our stockholders except as required by law.

The Class B common stock will automatically convert into Class A common stock concurrently with or immediately following the

consummation of the initial Business Combination on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and

the like, and subject to further adjustment as provided herein.

In the case that additional shares of Class A common stock or equity-linked securities are issued or deemed issued in connection with the initial Business Combination, the number

of shares of Class A common stock issuable upon conversion of all Founder Shares will equal, in the aggregate, on an as-converted basis, 20% of the total number of shares of Class A common stock

outstanding after such conversion (after giving effect to any redemptions of shares of Class A common stock by Public Stockholders), including the total number of shares of Class A common stock issued, or deemed issued or issuable upon

conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of the initial Business Combination, excluding any shares of Class A common stock or

equity-linked securities or rights exercisable for or convertible into shares of Class A common stock issued, or to be issued, to any seller in the initial Business Combination and any Private Placement Warrants issued to the Sponsor, officers

or directors upon conversion of Working Capital Loans, provided that such conversion of Founder Shares will never occur on a less than one-for-one basis.

Preferred Stock The Company is authorized to issue 1,000,000 shares of preferred stock, par value $0.0001 per share, with such

designations, voting and other rights and preferences as may be determined from time to time by the Companys board of directors.

As of December 31, 2020, there were no shares of preferred stock issued or outstanding.

Warrants Public Warrants may only be exercised for a whole number of shares.

No fractional Public Warrants will be issued upon

separation of the Units and only whole Public Warrants will trade.

The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a Business Combination or (b) 12 months from the closing of the Initial Public

provided in each case that the Company has an effective registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise of the Public Warrants and a current prospectus relating to

them is available (or the Company permits holders to exercise their Public Warrants on a cashless basis and such cashless exercise is exempt from registration under the Securities Act).

The Company has agreed that as soon as practicable, but in no

event later than 15 business days after the closing of the initial Business Combination, the Company will use its best efforts to file with the SEC and have an effective registration statement covering the shares of Class A common stock

issuable upon exercise of the warrants and to maintain a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed.

If a registration statement covering the Class A common stock issuable

upon exercise of the warrants is not effective by the 60th business day after the closing of the initial Business Combination, warrant holders may, until such time as there is an effective registration statement and during any period when the

Company will have failed to maintain an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption.

Notwithstanding the above, if the

Companys shares of Class A common stock are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a covered security under Section 18(b)(1) of the

Securities Act, the Company may, at its option, require holders of Public Warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so

elect, it will not be required to file or maintain in effect a registration statement, and in the event the Company does not so elect, it will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an

exemption is not available.

The warrants have an exercise price of $11.50 per share, subject to adjustments and will

expire five years after the completion of a Business Combination or earlier upon redemption or liquidation.

In addition, if (x) the Company issues additional shares of Class A common stock or equity-linked securities for capital raising

purposes in connection with the closing of the initial Business Combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price to be determined in good

faith by the board of directors and, in the case of any such issuance to the initial stockholders or their affiliates, without taking into account any Founder Shares held by the initial stockholders or such affiliates, as applicable, prior to such

issuance) (the Newly Issued Price), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of the initial Business Combination on the

date of the consummation of the initial Business Combination (net of redemptions), and (z) the volume weighted average trading price of our Class A common stock during the 20 trading day period starting on the trading day after the day on

which the Company consummates its initial Business Combination (such price, the Market Value) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the

Market Value and the Newly Issued Price, the $18.00 per share redemption trigger price described under Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00 will be adjusted (to the nearest

cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price, and the $10.00 per share redemption trigger price described under Redemption of warrants when the price per share of Class A common Stock equals or

exceeds $10.00 will be adjusted (to the nearest cent) to be equal to the higher of the Market Value and the Newly Issued Price.

Private Placement Warrants are identical to the Public Warrants, except that the Private Placement Warrants and the shares of Class A common stock issuable upon exercise of the Private Placement Warrants will not be transferable, assignable or

salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions.

Additionally, the Private Placement Warrants will be non-redeemable so long as they are held by the

Sponsor or its permitted transferees.

If the Private Placement Warrants are held by someone other than the Sponsor or its permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the

same basis as the Public Warrants.

Redemption of warrants when the price per share of Class A

common stock equals or exceeds $18.00 :

Once the warrants become exercisable, the Company may redeem the outstanding warrants for

II, dMY and Sponsor (collectively “dMY Defendants”) and Carter Glatt (“Glatt”) and Captains Neck Holdings LLC (“Captains Neck”), an entity of which Mr.

Glatt is a member.

The underlying lawsuit, filed by dMY Technology Group, Inc.

and dMY Sponsor, LLC, seeks a declaratory judgment that Glatt and Captains Neck are not entitled to membership units of dMY Sponsor LLC, which was formed by Harry L.

You, the co-founder

and former President and Chief Financial Officer of GTY when Glatt was still working at GTY.

The underlying lawsuit contains claims arising from Glatt’s termination of employment from GTY, including theft and misappropriation of confidential GTY information, breach of contract, breach of the duties of loyalty and fiduciary duty and conversion.

Glatt responded to the underlying lawsuit by adding members of the Sponsor and officers of dMY as additional counterclaim defendants (collectively with the dMY Defendants Glatt and Captains neck, the “Counterclaim Defendants”) and adding Dune Acquisition Holdings LLC, a newly formed special purpose acquisition company, as a counterclaimant and asserting claims for breach of contract, fraudulent misrepresentation, negligent misrepresentation, tortious interference with business relations, quantum meruit and unjust enrichment.

dMY, and now the Company, has never employed Glatt and has no business agreements with him.

The Counterclaim Defendants have denied the claims against them and have filed a motion to dismiss the suit.

Although the outcome of this matter cannot be predicted with certainty and the impact of the final resolution of this matter on the Company’s results of operations in a particular subsequent reporting period is not known, management does not believe that the resolution of this matter will have a material adverse effect on the Company’s future consolidated financial position, future results of operations or cash flows.

CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY

amended and restated certificate of incorporation authorizes us to issue up to 1,000,000,000 shares of common stock, $ 0.0001 par value per share, and 20,000,000 shares of preferred stock, par value $ 0.0001 per share.

Convertible Redeemable Preferred Stock

Legacy IonQ’s convertible redeemable preferred stock previously classified as mezzanine equity was retroactively adjusted, converted into common stock, and reclassified to permanent equity because of the reverse recapitalization as described in Note 1.

No shares of Legacy IonQ convertible redeemable preferred stock were issued during the years ended December 31, 2021 and 2020 requiring adjustment as a result of the reverse recapitalization.

Preferred Stock

amended and restated certificate of incorporation, our board of directors may, without further action by our stockholders, fix the rights, preferences, privileges and restrictions of up to an aggregate of 20,000,000 shares of preferred stock in one or more series and authorize their issuance.

These rights, preferences and privileges could include dividend rights, conversion rights, voting rights, terms of redemption, liquidation preferences and the number of shares constituting any series or the designation of such series, any or all of which may be greater than the rights of common stock.

Any issuance of preferred stock could adversely affect the voting power of holders of common stock and the likelihood that such holders would receive dividend payments and payments on liquidation.

In addition, the issuance of preferred stock could have the effect of delaying, deterring or preventing a change of control or other corporate action.

No shares of preferred stock have been issued as of December 31, 2021.

The terms, rights, preference, and privileges of the common stock are as follows:

Voting Rights

Except as otherwise required by law or as otherwise provided in any certificate of designation for any series of preferred stock, each holder of common stock possess all voting power for the election of our directors and all other matters requiring stockholder action.

Holders of common stock are entitled to one vote per share on matters to be voted on by stockholders.

The Company’s

second amended and restated

certificate of incorporation and bylaws do not provide for cumulative voting rights.

Subject to preferences that may be applicable to any then outstanding preferred stock, the holders of common stock may be entitled to receive dividends out of legally available funds if the board of directors, in its discretion, determines to issue dividends and then only at the times and in the amounts that the board of directors may determine.

We do not anticipate paying any cash dividends in the foreseeable future.

In the event of our voluntary or involuntary liquidation, dissolution, distribution of assets or winding-up,

the holders of common stock will be entitled to receive an equal amount per share of all of our assets of whatever kind available for distribution to stockholders, after the rights of the holders of the preferred stock, if any, have been satisfied.

Rights and Preference

Holders of the Company’s common stock have no preemptive or other subscription rights, and there are no sinking fund or redemption provisions applicable to the common stock.

The rights, preferences, and privileges of

the holders of common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any series of the Company’s preferred stock that may be issued.

Currently no preferred stock has been issued as of December 31, 2021.

Founders’ Shares

Upon incorporation of the Company, the founders of the Company (the “Founders”) purchased an aggregate 16.2 million shares of common stock at a purchase price $ 0.0006 per share after giving effect to the recapitalization.

Subsequently, on July 25, 2016, upon the introduction of a new third-party investor, the

Company imposed a share restriction on an aggregate of 12.1 million of the Founders’ shares (the “Restricted Shares”), after giving effect to the recapitalization.

If the Founders terminate their relationship with the Company for any reason, the Company will have the right to repurchase such shares for the initial purchase price and the repurchase period will begin from such termination date until 120 days after the termination date;

provided, however ,

that if the Founders terminate their relationship with the Company or are otherwise terminated for good cause (each, a “Release Event”), in each case, within 12 months of a deemed liquidation event, the Company may not repurchase the shares.

Payment for the Restricted Shares will be made in cash if the Company exercises its option to repurchase the Founder’s shares.

Of the Restricted Shares subject to the repurchase option, 1/48 th

of the Restricted Shares shall be released from the repurchase option on each monthly anniversary from July 25, 2016 until all Restricted Shares are released from the repurchase option.

All Founders’ Shares were fully vested as of December 31, 2020.

See Note 13— Stock Based Compensation for further information.

Common Stock Reserved for Issuance

The Company’s common stock reserved for future issuances after giving effect to the recapitalization are as follows:

As of December 31,

Stock options outstanding

Warrants to acquire common stock

Public warrants outstanding

Shares available for future grant

Total common stock reserved

WARRANT TRANSACTION AGREEMENT

In November 2019, contemporaneously with a revenue arrangement, the Company entered into a contract, pursuant to which the Company agreed to issue to a customer a warrant to acquire shares of Legacy IonQ Series B-1

preferred stock (the “Warrant Shares”), subject to certain vesting events.

Upon closing of the Business Combination, these warrants exercisable for Legacy IonQ Series B-1 preferred stock were

assumed by the Company and converted into a warrant to purchase a number of shares of common stock equal to the product (rounded down to the nearest whole number) of (a) the number of shares of Legacy IonQ common stock issuable upon conversion of a share of Legacy IonQ Series B-1 preferred stock and

(b) the Exchange Ratio (as defined in the Super 8-K filed

with the SEC on October 4, 2021), at an exercise price per share (rounded up to the nearest whole cent) equal to (i) the exercise price per share of such Legacy IonQ Warrant Shares divided by (ii) the Exchange Ratio.

Except as specifically provided in the merger agreement, the Warrant Shares will have the same terms and be subject to the same conditions (including applicable vesting conditions) as set forth in the Legacy IonQ warrant agreement.

As of December 31, 2021, the contract allows for the customer to acquire up to 8,301,202 shares of common stock in the Company.

As the Warrant Shares were issued in connection with an existing commercial agreement with a customer, the value of the Warrant Shares was determined to be consideration payable to the customer and consequently is treated as a reduction to revenue recognized under the corresponding revenue arrangement.

Approximately 6.5 % of the Warrant Shares vested and became immediately exercisable in August 2020.

The remaining Warrant Shares will vest and become exercisable upon satisfaction of certain milestones based on revenue generated under the commercial agreement with the customer, to the extent certain prepayments are made by the customer.

The exercise price for the Warrant Shares is $ 1.38 per share and the warrant is exercisable through November 2029.

The fair value of the Warrant Shares at the date of issuance was determined to be $ 8.7 million.

During the year ended December 31, 2020, Warrant Shares with a fair value of $ 0.6 million vested.

This fair value of the unamortized warrants is recorded within other noncurrent assets and the Warrant Shares are amortized over time as the related customer revenue is earned.

During the years ended December 31, 2021 and 2020, $ 0.5 million and $ 0.04 million of the warrant amortization was recorded as a reduction of the related customer revenue.

As of December 31, 2021, the contract asset was fully amortized.

As discussed further in Note 1, the Warrant Shares were retroactively adjusted, converted to warrants for common stock and are presented in permanent equity as a result of the recapitalization as described in Note 1.

WARRANT LIABILITIES

The Company assumed 11,500,000 warrants, comprised of 7,500,000 public warrants and 4,000,000 private placement warrants, on September 30, 2021 as part of the Business Combination.

As of December 31, 2021, there were 5,233,018 public warrants to purchase common stock outstanding.

There were no private placement warrants outstanding as of December 31, 2021.

Each warrant entitles the registered holder to purchase one share of common stock at a price of $ 11.50 per share.

Public warrants

The public warrants may be exercised on the later of (a) 30 days after the completion of a Business Combination or (b) 12 months from the closing of the Initial Public Offering of dMY ;

provided in each case that the Company has an effective registration statement under the Securities Act covering the shares of common stock issuable upon exercise of the public warrants and a current prospectus relating to them is available (or the Company permits holders to exercise their public warrants on a cashless basis and such cashless exercise is exempt from registration under the Securities Act).

The public warrants became exercisable on November 17, 202 1

Redemption of warrants when the price per share of common stock equals or exceeds $ 18.00 :

Once the warrants become exercisable, the Company may redeem the outstanding warrants for cash:

in whole and not in part;

1 unchanged sentence

upon a minimum of 30 days’ prior written notice of redemption ;

if, and only if, the closing price of Class A common stock equals or exceeds $18.00 per share (as adjusted)

for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders.

The Company will not redeem the warrants as described above unless an effective registration statement under the Securities Act covering the

Class A common stock issuable upon exercise of the warrants is effective and a current prospectus relating to those shares of Class A common stock is available

throughout the 30-day redemption period.

Redemption of warrants for

when the price per share of Class A common stock equals or exceeds $10.00 :

Once the warrants

become exercisable, the Company may redeem the outstanding warrants:

if, and only if, the closing price of common stock equals or exceeds $ 18.00 per share (as adjusted) for any 20 trading days within a 30 -trading

day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders.

Redemption of warrants for when the price per share of common stock equals or exceeds $ 10.00

Once the warrants become exercisable, the Company may redeem the outstanding warrants:

in whole and not in part;

at $0.10 per warrant upon a minimum of 30 days prior written notice of redemption provided that holders

will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to an agreed table based on the redemption date and the fair market value (as defined below) of the

Class A common stock;

if, and only if, the closing price of Class A common stock equals or exceeds $10.00 per Public Share (as

adjusted) for any 20 trading days within the 30-trading day period ending three trading days before the Company sends notice of redemption to the warrant holders.

The fair market value of Class A common stock shall mean the volume weighted average price of Class A common stock

during the 10 trading days immediately following the date on which the notice of redemption is sent to the holders of warrants.

In no event will the warrants be exercisable in connection with this redemption feature for more than 0.361 shares of

Class A common stock per warrant (subject to adjustment).

In no event will the Company be required to net cash settle any warrant.

If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will

they receive any distribution from the Companys assets held outside of the Trust Account with the respect to such warrants.

Accordingly, the warrants may expire worthless.

Note 7Fair Value Measurements

The following table presents information about the Companys financial assets that are measured at fair value on a recurring basis as of

December 31, 2020 by level within the fair value hierarchy:

Quoted Prices

Investments held in Trust Account:

Treasury Securities (1)

Excludes $569 of cash balance held within the Trust Account.

Transfers to/from Levels 1, 2 and 3 are recognized at the end of the reporting period.

There were no transfers between levels for the year ended

December 31, 2020.

Note 8Income Taxes

The Companys taxable income primarily consists of interest income on the Trust Account.

The Companys general and administrative

expenses are generally considered start-up costs and are not currently deductible.

There was no income tax expense for the period from September 14, 2020 (inception) through December 31, 2020.

The income tax provision (benefit) consists of the following for the period from September 14, 2020 (inception) through December 31, 2020:

at $ 0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to an agreed table based on the redemption date and the fair

market value (as defined within the warrant agreement) of the common stock except as otherwise described within the warrant agreement;

and upon a minimum of 30 days’ prior written notice of redemption;

if, and only if, the closing price of common stock equals or exceeds $ 10.00 per public share (as adjusted) for any 20 trading days within the 30 -trading

day period ending three trading days before the Company sends notice of redemption to the warrant holders.

No public warrants were redeemed as of December 31, 2021.

Private placement warrants

The private placement warrants are identical to the public warrants, except that the private placement warrants and the shares of common stock issuable upon exercise of the private placement warrants will not be transferable, assignable, or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions.

Additionally, the private placement warrants will be non-redeemable

so long as they are held by dMY Sponsor III, LLC or its permitted transferees.

Otherwise, the private placement warrants have terms and provisions that are identical to those of the public warrants, including as to exercise price, exercisability and exercise period.

In December 2021, 4.0 million private placement warrants were exercised on a cashless basis, resulting in the net issuance of 2.2 million shares.

There are no private placement warrants outstanding as of December 31, 2021.

STOCK-BASED COMPENSATION

Equity Incentive Plans

The Company has a 2015 Equity Incentive Plan (the “2015 Plan”), which provided for the grant of stock-based compensation in the form of awards of options, stock appreciation rights, restricted stock awards and restricted stock units, to certain officers, directors, employees, consultants, and advisors to purchase shares of the Company’s common stock.

Upon the Closing of the Business Combination, no further awards will be made pursuant to the 2015 Plan and all outstanding Legacy IonQ stock options under the 2015 Plan were assumed by the Company.

Each Legacy IonQ stock option issued and outstanding immediately prior to the Business Combination was converted into an option to purchase shares of common stock of the Company equal to the product of (a) the number of shares of Legacy IonQ common stock subject to such Legacy IonQ stock option agreement immediately prior to the Business Combination and (b) the exchange ratio at an exercise price equal to the (i) the exercise price per share of such Legacy IonQ stock option divided by (ii) the exchange ratio.

Such stock options will continue to be governed by the terms of the 2015 Plan and the stock option agreements thereunder, until such outstanding options are exercised or until they terminate or expire by their terms.

For awards granted under the 2015 Plan, vesting generally occurs over four to five years from the date of grant and all options granted have a contractual term

Vested options held at the date of an employee’s termination may be exercised within three months.

In August 2021, the Company’s board of directors adopted the 2021 Equity Incentive Plan (the “2021 Plan”) and the stockholders approved the 2021 Plan in September 2021.

The 2021 Plan became effective immediately upon the closing of the Business Combination.

The 2021 Plan provides for the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance awards and other forms of awards to employees, directors, and consultants.

Initially, a maximum of 26,235,000 shares of common stock may be issued under the 2021 Plan.

The number of shares of the Company’s common stock reserved for issuance under the 2021 Plan automatically increases on January 1 of each year, beginning on January 1, 2022 and continuing through and including January 1, 2031, by 5 % of the Fully Diluted Common Stock (as defined in the 2021 Plan) outstanding on December 31 of the preceding year, or a lesser number of shares determined by the Company’s board of directors prior to such increase.

No shares or awards were granted under the 2021 Plan as of December 31, 2021.

Stock Options

The Company estimates the fair value of stock options on the date of grant using the Black-Scholes option- pricing model.

The Black-Scholes option- pricing model requires estimates of highly subjective assumptions, which affect the fair value of each stock option.

Expected Volatility—As the Company was privately held at the date of the grant and there has been no public market for its common stock prior to closing the Business Combination, the expected volatility is based on the average historical stock price volatility of comparable publicly- traded companies in its industry peer group, financial, and market capitalization data.

Expected Term—The expected term of the Company’s options represents the period that the stock-based awards are expected to be outstanding.

The Company has estimated the expected term of its employee awards using the SAB Topic 14 Simplified Method allowed by the FASB and SEC, for calculating expected term as it has limited historical exercise data to provide a reasonable basis upon which to otherwise estimate expected term.

Certain of the Company’s options began vesting prior to the grant date, in which case the Company uses the remaining vesting term at the grant date in the expected term calculation.

Risk-Free Interest Rate—The Company estimates its risk-free interest rate by using the yield on actively traded non-inflation-indexed

treasury securities with contract maturities equal to the expected term.

Dividend Yield—The Company has not declared or paid dividends to date and does not anticipate declaring dividends.

As such, the dividend yield has been estimated to be zero.

Fair Value of Underlying Common Stock—Because the Company’s common stock was not yet publicly traded on the date of grant, the Company estimated the fair value of common stock prior to closing the Business Combination.

The Board of Directors considered numerous objective and subjective factors to determine the fair value of the Company’s common stock at each meeting in which awards are approved.

The factors considered include, but are not limited to:

(i) the results of contemporaneous independent third-party valuations of the Company’s common stock;

(ii) the prices, rights, preferences, and privileges of Legacy IonQ’s previously Convertible Redeemable Preferred Stock relative to those of its common stock;

(iii) the lack of marketability of the Company’s common stock;

(iv) actual operating and financial results;

(v) current business conditions and projections;

(vi) the likelihood of achieving a liquidity event, such as an initial public offering or sale of the Company, given prevailing market conditions;

and (vii) precedent transactions involving the Company’s shares.

The assumptions used to estimate the fair value of stock options granted during the years ended December 31, 2021 and 2020 are as follows:

Risk-free interest rate

Expected term (in years)

Expected volatility

Dividend yield

A summary of the stock option activity is as follows:

(in millions)

Outstanding as of December 31, 2019

Cancelled/ Forfeited

Outstanding as of December 31, 2020

Cancelled/ Forfeited

Outstanding as of December 31, 2021

Exercisable as of December 31, 2021

Exercisable and expected to vest at December 31, 2021

The total intrinsic value of options exercised was $ 54.4 million

and $ 3.8 million for the years ended December 31, 2021 and 2020, respectively.

The weighted-average grant date fair value per share for the stock options granted during the years ended December 31, 2021 and 2020 was $ 5.83 and $ 0.76 , respectively.

The aggregate grant-date fair value of options vested during the years ended December 31, 2021 and 2020 was $ 7.4 million

and $ 1.0 million, respectively.

As of December 31, 2021, the total unrecognized compensation related to unvested stock option awards was $ 30.4 million, which the Company expects to recognize over a weighted-average period of approximately 2.0 years.

Early Exercised Stock Options

As of December 31, 2021 and 2020, there were 1,420,662 and no shares respectively, subject to repurchase related to stock options early exercised and unvested.

These amounts are reclassified to common stock and additional paid-in capital as the underlying shares vest.

As of December 31, 2021, the Company recorded a liability related to these shares subject to repurchase in the amount of $ 3.1 million in its consolidated balance sheet.

The Company did not have any early exercises of stock options prior to 2021, and as a result, there was no such liability balance as of December 31, 2020.

During 2021, we exercised our right to repurchase 0.4 million shares related to the early exercise of stock options.

The unvested shares were repurchased for $ 1.0 million from an employee in connection with the termination of their service.

Unvested Restricted Stock – Founder’s Shares

In addition to the unvested common shares outstanding described above at “Early Exercised Stock Options,” the Company issued restricted stock to its founders.

The fair value of the restricted shares determined based on the fair market value of Legacy IonQ’s common stock on July 25, 2016, the date the restriction was put into place, was $ 1.2 million.

A summary of the unvested restricted shares activity is as follows:

Average Grant

Date Fair Value

Unvested Balance as of December 31, 2019

Unvested Balance as of December 31, 2020

The aggregate grant-date fair value of restricted shares vested was $ 170 thousand for the year ended December 31, 2020.

As of December 31, 2020, all restricted shares have vested and there were no new founders’ shares issued during 2021.

Total stock based compensation expense for both stock option awards and unvested restricted shares is as follows (in thousands):

Years Ended December 31,

Cost of revenue

Research and development

Sales and marketing

General and administrative

Stock-based compensation, net of amounts capitalized

Capitalized stock-based compensation—Intangibles and fixed assets

Capitalized stock-based compensation—Other current assets

Total stock-based compensation

Employee Stock Purchase Plan

In August 2021, the Company’s board of directors adopted the Employee Stock Purchase Plan (the “ESPP”), which was subsequently approved by the Company’s stockholders in September 2021, and became effective upon the closing of the Business Combination.

The ESPP is intended to qualify as an “employee stock purchase plan” within the meaning of Section 423 of the U.S.

Internal Revenue Code of 1986, as amended (the “Code”).

The number of shares of common stock initially reserved for issuance under the ESPP was 5,354,000 shares.

The ESPP provides for an annual increase on January 1 of each year, beginning on January 1, 2022 and continuing through and including January 1, 2031, equal to the lesser of (i) 1 % of the fully diluted shares of common stock outstanding on the last day of the prior fiscal year, (ii) 10,708,000 shares, or (iii) a lesser number of shares determined by the Company’s board of directors prior to such increase.

Under the terms of the ESPP, eligible employees can elect to acquire shares of the Company’s common stock through periodic payroll deductions during a series of offering periods.

Purchases under the ESPP are affected on the last business day of each offering period at a 15 % discount to the lower of closing price on that day or the closing price on the first day of the offering period.

As of December 31, 2021, no shares of common stock had been issued under the ESPP and no offering period has been set by the board of directors.

The current and deferred components of the provision for income taxes for both Federal and State jurisdictions are zero

for both of the years ended December 31, 2021 and 2020.

The Company’s provision for incom e

taxes differs from the amount determined by applying the applicable federal statutory tax rate to the loss before income taxes due to the valuation allowance for the net deferred income tax assets.

A reconciliation of the U.S.

statutory tax rate to our effective tax rate is presented below:

federal statutory income tax rate

State and local income taxes

R&D tax credits

Stock-based compensation

Warrant expense

Change in tax rates

Valuation allowance

Income tax provision

The Companys net deferred tax assets are as follows as of December 31, 2020:

Effective tax rate

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

Significant components of the Company’s deferred tax assets and liabilities were as follows (in thousands):

Deferred tax assets:

Accrued bonus

Deferred revenue

Non-qualified stock compensation

Accrued expenses

Warrant expenses

Depreciation and amortization

Lease liabilities

R&D credit carryforwards

Net operating loss carryforwards

Start-up/organizational costs

Total deferred tax assets

Valuation allowance

Deferred tax asset, net of allowance

In assessing the realization of deferred tax assets, management considers whether it is more likely than not

that some portion or all of the deferred tax assets will not be realized.

The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences representing net

future deductible amounts become deductible.

Management considers the scheduled reversal of deferred tax assets, projected future taxable income and tax planning strategies in making this assessment.

After consideration of all of the information

available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance.

There were no unrecognized tax benefits as of December 31, 2020.

No amounts were accrued for the payment of interest and penalties at

December 31, 2020.

The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.

The Company is subject to income tax examinations by major taxing

authorities since inception.

A reconciliation of the statutory federal income tax rate (benefit) to the Companys effective tax rate

(benefit) is as follows for the period from September 14, 2020 (inception) through December 31, 2020:

Statutory Federal income tax rate

Change in Valuation Allowance

Income Taxes Benefit

Note 9Subsequent Events

On December 21, 2020, the Company repaid approximately $90,000 of the outstanding Note balance.

On January 12, 2021, the Company, the Sponsor accepted service of a lawsuit where they are named as Counterclaim Defendants in an underlying

action by and between GTY Technology Holdings, Inc.

(GTY), dMY Technology Holdings Inc., dMY Sponsor, LLC, dMY Sponsor II, LLC, dMY Technology Group Inc.

II, the Company and the Sponsor (collectively dMY) and Carter Glatt

(Glatt) and Captains Neck Holdings LLC (Captains Neck).

The Underlying Lawsuit seeks a declaratory judgment that Glatt and Captains Neck are not entitled to Class Y Units of dMY Sponsor LLC and contains claims arising from

Glatts termination of employment from GTY on or about April 3, 2020 including theft and misappropriation of confidential GTY information, breach of contract, breach of the duties of loyalty and fiduciary duty and conversion.

Glatt has, among

other things, responded to the Underlying Lawsuit by adding members of the Sponsor and officers of the Company as Counterclaim Defendants and adding Dune Acquisition Holdings LLC, a newly formed special purpose acquisition company as a

Counterclaimant and asserting claims for breach of contract, fraudulent misrepresentation, negligent misrepresentation, tortious interference with business relations, quantum meruit and unjust enrichment.

The Company has never employed Glatt and has

no business agreements with him.

The Company has denied the claims against them and management intends to vigorously defend the Company.

On March 7, 2021, the Company entered into an Agreement and Plan of Merger (the Merger Agreement) with Ion Trap Acquisition Inc.,

a Delaware corporation and a direct, newly formed wholly owned subsidiary of the Company (Merger Sub) and IonQ, Inc., a Delaware corporation (IonQ).

Pursuant to the Merger Agreement, at the Effective Time, and in accordance

with the Delaware General Corporation Law, as amended, Merger Sub will merge with and into IonQ (the Merger), with IonQ continuing as the surviving entity in the Merger and, after giving effect to the Merger, becoming a wholly owned

subsidiary of the Company.

See the Current Report on Form 8-K, filed with the SEC on March 7, 2021, for further information.

2021, concurrently with the execution of the Merger Agreement, the Company entered into subscription agreements with certain investors (collectively, the PIPE Investors), pursuant to, and on the terms and subject to the conditions of

which, the PIPE Investors have collectively subscribed for 35,000,000 shares of the Companys Class A common stock for an aggregate purchase price equal to $350,000,000.

See the Current Report on Form 8-K, filed with the SEC on March 7, 2021,

for further information.

The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the

date that the financial statements were available to be issued, and determined that there have been no events that have occurred that would require adjustments to the disclosures in the financial statements.

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.

March 25, 2021

DMY TECHNOLOGY GROUP, INC.

/s/ Niccolo de Masi

Niccolo de Masi

Chief Executive Officer

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Niccolo de Masi and Harry L.

You, and each or any

one of them, his or her true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him or her and in his or her name, place and

stead, in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the

United States Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and

every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or his or her substitutes or substitute, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant

and in the capacities and on the dates indicated.

/s/ Niccolo de Masi

Chief Executive Officer

March 25, 2021

Niccolo de Masi

(principal executive officer and principal financial and accounting officer)

March 25, 2021

/s/ Darla Anderson

March 25, 2021

Darla Anderson

/s/ Francesca Luthi

March 25, 2021

Francesca Luthi

/s/ Charles E.

March 25, 2021

Total deferred tax assets net of valuation allowance

Deferred tax liabilities:

Depreciation and amortization

Right of use assets

Capitalized patents

Internally developed software

Capitalized R&D costs

Total deferred tax liabilities

Net deferred tax assets (liabilities)

The Company had U.S.

federal and state net operating loss c a

rryforwards of approximately $ 14.1

million as of December 31, 2021.

The Company’s net operating loss carryforwards generated prior to January 1, 2018 of $ 1.1 million will begin to expire, if not utilized, in 2036.

The Company’s net operating loss carry forwards generated after

December 31, 2017 will carryforward indefinitely.

As of December 31, 2021 the Company had U.S.

federal and state tax credit carryforwards of $ 3.8

The tax credit carryforwards will expire between 2025 and 2041.

The deductibility of such credits and net operating losses (“NOL”) may be limited.

Under Section 383 and 382 of the Internal Revenue Code of 1986, as amended (the “Code”), and corresponding provisions of state law, if a corporation undergoes an “ownership change,” which generally occurs if the percentage of the corporation’s stock owned by 5 % stockholders increases by more than 50 % over a three-year period, the corporation’s ability to use its pre-change,

credits and NOL carryforwards and other pre-change

tax attributes to offset its post-change income, may be limited.

We have not determined if we have experienced Section 383/382 ownership changes in the past and if a portion of our NOL and tax credit carryforwards are subject to an annual limitation.

In addition, we may experience ownership changes in the future as a result of subsequent shifts in our stock ownership, some of which may be outside of our control.

If we determine that an ownership change has occurred and our ability to use our historical NOL and tax credit carryforwards is significantly limited, it would harm our future operating results by effectively increasing our future tax obligations.

The Company has evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets.

Based on the Company’s history of operating losses, including a three-year cumulative loss position as of December 31, 2021 and 2020, the Company has concluded that it is not more likely than not that its deferred income tax assets will be realized.

Accordingly, the Company has provided a full valuation allowance, for each of

the years ended December 31, 2021 and 2020.

The net increase in the valuation allowance of $ 8.6 million

is due to the current year operating losses.

The Company is generally subject to a three-year statute of limitations by major tax jurisdictions.

The current tax years that are subject for examination are tax years 201 8

through 2020, although tax years dating back to 201 6

remain open up to the tax attribute amounts carried forward for future use.

The Company has one operating lease for its corporate headquarters that is also used for its research and development functions.

The lease was amended in March 2020 to extend the terms of the agreement for the existing premise and lease additional expansion premise and in December 2020 to provide additional rent adjustments.

The amended leases were entered into with UMD.

Refer to Note 17—Related Party Transactions for further information.

The Company determined the modified lease for the original premises and the lease for the expansion premises were both operating leases.

The March 2020 amendment was determined to represent a modification to the existing lease with two lease components for both the original premises and expansion premises.

The lease commencement date for the expansion premises was in December 2020.

The modified lease for the original premises was reassessed utilizing an incremental borrowing rate at the effective date of the amendment.

In December 2020, the original premise was further reassessed due to a rent adjustment associated with lessor assets paid for by the Company.

For the original premises, these reassessments resulted in the recognition of an additional ROU asset and lease liabilit

y of $ 0.6 million in March 2020 and $ 0.1 million in December 2020.

At the lease commencement date for the expansion premise, the Company recorded a ROU asset and lease liability of $ 2.8 million.

As of December 31, 2021 and 2020, the weighted- average remaining lease term was 9 years and 10 years, respectively.

The weighted-average discount rate was 11.9 % at December 31, 2021 and 2020, respectively.

The components of lease cost were as follows (in thousands):

Operating lease cost (1)

Fixed lease cost

Short-term cost

Total operating lease cost

The lease costs are reflected in the consolidated statements of operations as follows (in thousands):

Cost of revenue

Research and development

Sales and marketing

General and administrative

Supplemental cash flow and other information related to operating leases was as follows (in thousands):

Cash payments included in the measurement of operating lease liabilities

Operating lease right-of-use assets recognized in exchange for new operating lease obligations

As of December 31, 2021, maturities of operating lease liabilities are as follows (in thousands):

Year Ending December 31,

Total lease payments

imputed interest

Present value of operating lease liabilities

EMPLOYEE BENEFIT PLAN

The Company has a 401(k) savings plan (the “401(k) Plan”) that qualifies as a deferred salary arrangement under Section 401(k) of the Internal Revenue Code.

Under the 401(k) Plan, participating employees may elect to contribute up to 100 % of their eligible compensation, subject to certain limitations.

The 401(k) Plan provides for a discretionary employer-matching contribution.

The Company made a matching contribution of $ 0.5 million and $ 0.3 million to the 401(k) Plan for the years ended December 31, 2021 and 2020, respectively.

RELATED PARTY TRANSACTIONS

Transactions with UMD and Duke

As described in Note 7—Agreements with UMD and Duke, the Company entered into a License Agreement and Option Agreement with UMD and Duke whereby the Company, in the normal course of business, has licensed certain intellectual property and, in the case of the Amendment to the Duke and UMD Option Agreement, has purchased research and development services.

The Company considers these agreements to be related party

transactions because during 2021 and 2020, the Company’s Co-founder

and Chief Technology Officer served as a professor at Duke and the Company’s Co-founder

and Chief Scientist served as a professor at the UMD.

During 2021, the Company’s Chief Scientist moved to Duke and each, in their role as professors at Duke, are leading the research subject to the License Agreement and Option Agreement with Duke as of December 31, 2021.

In addition, the Company entered into an amendment to its operating lease for office space with the UMD.

The lease was amended with UMD in March 2020 to extend the terms of the agreement for the existing premise and lease additional expansion premise and was amended in December 2020 to provide additional rent adjustments.

Refer to Note 15 – Leases, for additional information regarding the Company’s leases.

In September 2021, the Company entered into a multiyear deal with UMD to provide certain quantum computing services and facility access related to the National Quantum Lab at UMD in exchange for payments totaling $ 14 million over 3 years.

The Company’s results from transactions with UMD and Duke, as reflected in the Consolidated Statements of Operations are detailed below (in thousands):

Year Ended December 31,

Cost of Revenue

Research and Development

Sales and Marketing

General and administrative

The Company has the following balances related to transactions with UMD and Duke, as reflected in the Consolidated Balance Sheets:

Year Ended December 31,

Prepaid expenses and other current assets

Operating lease right-of-use

Other noncurrent assets

Accounts payable

Current operating lease liabilities

Unearned revenue

operating lease liabilities

SUBSEQUENT EVENTS

In January 2022, the Company granted an aggregate of 1,687,669 restricted stock units (“RSUs”) and 900,170 stock options to certain directors, employees and consultants of the Company under the 2021 Equity Incentive Plan.

The awards represent the contingent right to receive shares of the Company’s common stock, substantially all of which vest over a four -year period based on continuous service .

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures