NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Dear Stockholders,
You are cordially invited to attend the 20192022 annual meeting of stockholders (the “Annual Meeting”) of Concert Pharmaceuticals, Inc. (the(“we” or “Companyus”), which will be held on Thursday, June 13, 20199, 2022 at 9:00 AMa.m., Eastern Time,time, at theour offices, of the Company, 65 Hayden Avenue, Suite 3000N, Lexington, MA 02421, to consider and vote upon the following proposals:
1. The election of twoTo elect one Class II Directors (the “Director Nominees”) to our Board of Directors (the(our “Board”), to serve until the 2022our 2025 annual meeting of stockholders (the “Director Proposal”);stockholders;
2. The ratification ofTo hold a non-binding, advisory vote on executive compensation;
3. To ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for the fiscal year ending December 31, 20192022;
4. To approve an amendment to our restated certificate of incorporation, as amended (the “Auditor Proposalcertificate of incorporation”); to increase the number of authorized shares of common stock from 100,000,000 to 200,000,000; and
Our Board has fixed the close of business on April 16, 201912, 2022 as the record date for the purposepurposes of determining the stockholders who are entitled to receive notice of, and to vote at, the Annual Meeting. Only stockholders of record at the close of business on the record date are entitled to notice of, and to vote at, the Annual Meeting and at any adjournmentadjournments or postponements of that meeting.the Annual Meeting.
We are pleased to take advantage of Securities and Exchange Commission rules that allow companies to furnish their proxy materials over the Internet. On or about May 3, 2019,[_____], 2022, we are mailing to many of our stockholders a Notice of Internet Availability of Proxy Materials (the “Notice”) instead of a paper copy of our proxy materials and our 20182021 Annual Report on Form 10-K. The Notice contains instructions on how to access those documents and to cast your vote via the Internet or by telephone. The Notice also contains instructions on how to request a paper copy of our proxy materials and our 20182021 Annual Report on Form 10-K. All stockholders who do not receive a Notice will receive a paper copy of the proxy materials and the 20182021 Annual Report on Form 10-K by mail. This process allows us to provide our stockholders with the information they need on a more timely basis, while reducingreduce the environmental impact and loweringlower the costs of printing and distributing our proxy materials.
Your vote is very important. Whether or not you plan to attend the Annual Meeting in person, please vote as soon as possible by submitting your proxy via the Internet or by telephone as indicated on theyour proxy card or in your proxy materials or by signing, dating and returning the proxy card. If you hold your shares in “street name,” you should instruct your bank, broker or other nominee on how to vote your shares in accordance with the voting instruction form that you will receive from your bank, broker or other nominee.
We currently intend to hold the Annual Meeting in person. However, we are continuing to monitor the ongoing coronavirus (COVID-19) pandemic and are sensitive to the public health and travel concerns our stockholders may have and the protocols that federal, state and local governments may impose. In the event it is not possible or advisable to hold the Annual Meeting in person, we will announce alternative arrangements for the meeting as promptly as practicable, which may include holding the meeting solely by means of remote communication. Please monitor the “Investors” section of our website,
www.concertpharma.com, for updated information. If you are planning to attend the Annual Meeting, please check the website one week prior to the meeting date. As always, we encourage you to vote your shares prior to the Annual Meeting.
By Order of the Board of Directors
Roger D. Tung, Ph.D.
President and Chief Executive Officer
Lexington, Massachusetts
[_____], 2022
PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS
to be held on Thursday, June 9, 2022
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QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING AND THE PROPOSALS
The following are some questions that you, as a holder of common stock of the Company,Concert Pharmaceuticals, Inc. (“Concert,” “we” or “us”) may have regarding the 2019our 2022 annual meeting of stockholders (the “Annual Meeting”) of Concert Pharmaceuticals, Inc. (the “Company”) and the proposals and brief answers to such questions. We urge you to carefully read this entire proxy statement and the documents referred to in this proxy statement because the information in this section does not provide all the information that may be important to you as a stockholder of the CompanyConcert with respect to the proposals.
Our Board of Directors (the “Board of Directors” or the(our “Board”) has made this proxy statement and related materials available to you on the Internet, or at your request has delivered printed versions to you by mail, in connection with the solicitation of proxies by theour Board of Directors for the Annual Meeting, and any adjournment or postponement of the Annual Meeting. If you requested printed versions of these materials by mail, they will also include a proxy card for the Annual Meeting.card.
Pursuant to rules adopted by the Securities and Exchange Commission (the “SEC”), we are providing access to our proxy materials over the Internet. Accordingly, we are sending a Notice of Internet Availability of Proxy Materials (the “Notice”) to our stockholders of record and beneficial owners as of the record date identified below.April 12, 2022 (the “Record Date”). The mailing of the Notice to our stockholders is scheduled to begin on or about May 3, 2019.[_____], 2022.
IMPORTANT NOTICE REGARDING THE INTERNET AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL STOCKHOLDERS MEETING TO BE HELD ON JUNE 13, 2019:9, 2022:
This Proxy Statement, the accompanying proxy card or voting instruction card and our 20182021 Annual Report on Form 10-K are available at: http://ir.concertpharma.com/annual-meeting.
When and where will the Annual Meeting take place?
The Annual Meeting will be held on June 13, 20199, 2022 at 9:00 AMa.m., Eastern Time,time, at theour offices, of the Company, 65 Hayden Avenue, Suite 3000N, Lexington, MA 02421.
Will the Annual Meeting be impacted by the ongoing coronavirus (COVID-19) pandemic?
We are continuing to monitor the ongoing coronavirus (COVID-19) pandemic and are sensitive to the public health and travel concerns our stockholders may have and the protocols that federal, state and local governments may impose. In the event it is not possible or advisable to hold the Annual Meeting in person, we will announce alternative arrangements for the meeting as promptly as practicable, which may include holding the meeting solely by means of remote communication. Please monitor the “Investors” section of our website, www.concertpharma.com, for updated information. If you are planning to attend the Annual Meeting, please check the website one week prior to the meeting date. As always, whether or not you plan to attend the Annual Meeting in person, please vote as soon as possible by submitting your proxy via the Internet or by telephone as indicated on the proxy card or by signing, dating and returning the proxy card.
What proposals are the stockholders being asked to consider?
At the Annual Meeting, you will be asked to consider and vote upon:upon the following proposals:
| 1. | ||||||||
| 2. | ||||||||
| 3. | To ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for the fiscal year ending December 31, | |||||||
| 4. | To approve an amendment to our certificate of incorporation to increase the number of authorized shares of common stock from 100,000,000 to 200,000,000 (the “Authorized Shares Proposal”); and | |||||||
| 5. | ||||||||
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What are the recommendations of theour Board?
What is the Record Date for the Annual Meeting?
Holders of our common stock as of the close of business on April 16, 2019, the “Record Date” for the Annual Meeting,12, 2022 are entitled to notice of, and to vote at, the Annual Meeting and any postponementsadjournments or adjournmentspostponements of the Annual Meeting.
Who can vote at the Annual Meeting?
Stockholders who owned shares of our common stock on the Record Date may attend and vote at the Annual Meeting. There were 23,781,68736,329,342 shares of common stock outstanding on the Record Date. All shares of common stock have one vote per share and vote together as a single class. Information about the stockholdings of our directors and executive officers is contained in the section of this proxy statement entitled “Principal StockholdersStock Ownership and Reporting – Security Ownership of Certain Beneficial Owners and Management.”.
What is the difference between holding shares as a stockholder of record and as a beneficial owner?
Most of our stockholders hold their shares in an account at a brokerage firm, bank or other nominee holder, rather than holding share certificates in their own name. As summarized below, there are some distinctions between shares held of record and those owned beneficially.
Stockholder of Record
If, on the Record Date, your shares were registered directly in your name with our transfer agent, Computershare, you are a “stockholder of record” who may vote at the Annual Meeting, and we are sending these proxy materials or the Notice directly to you. You can vote by proxy overvia the Internet or by telephone by following the instructions provided in the Notice, or, if you
requested printed copies of the proxy materials by mail, you can vote by mailing your proxy as described in the proxy materials.
Beneficial Owner
If, on the Record Date, your shares were held in an account at a brokerage firm or at a bank or other nominee holder, you are considered the beneficial owner of shares held “in streetin “street name,” and these proxy materials or the Notice are being forwarded to you by your broker, bank or other nominee who is considered the stockholder of record for purposes of voting at the Annual Meeting. As the beneficial owner, you have the right to direct your broker, bank or other nominee on how to vote your shares and to attend the Annual Meeting. However, since you are not the stockholder of record, you may not vote these shares in person at the Annual Meeting unless you receive a valid proxy from your brokerage firm, bank or other nominee holder. To obtain a valid proxy, you must make a special request of your brokerage firm, bank or other nominee holder. If you do not make this request, you can still vote by using the voting instruction card enclosed with this proxy statement; however, you will not be able to vote in person at the Annual Meeting.
What is the quorum required for the Annual Meeting?
The representation in person or by proxy of holders of at least a majority of the issued and outstanding shares of our common stock entitled to vote at the Annual Meeting is necessary to constitute a quorum for the transaction of business at the Annual Meeting. For purposes of determining the presence of a quorum, abstentions and broker non-votes will be counted as present at the Annual Meeting.
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Assuming that a quorum is present, what vote is required to approve the proposals to be voted upon at the Annual Meeting?
| • | Director Proposal: The election of the Director Nominee requires a plurality of the affirmative votes cast at the Annual Meeting. You may vote “For” or “Withhold” your vote. | |||||||
| • | Say-on-Pay Proposal:The | |||||||
| • | Auditor Proposal: The ratification of the appointment of Ernst & Young LLP requires the affirmative vote of a majority of the | |||||||
| • | Authorized Shares Proposal: The affirmative vote of the holders of a majority of the shares of our common stock issued and outstanding and entitled to vote at the Annual Meeting is required for approval of the amendment to our certificate of incorporation to increase the number of authorized shares of common stock.You may vote “For” or “Against” or abstain from voting on the Authorized Shares Proposal. |
How do I vote?
Stockholders have four voting options. You may vote using one of the following methods:
| 1. | Internet or Telephone. To vote | |||||||
| 2. | Mail. If you requested or receive a paper proxy card and voting instructions by mail, simply complete, sign and date the enclosed proxy card and return it before the |
| 3. | In Person. You may come to the Annual Meeting and cast your vote there. |
The voting deadlines and availability of telephoneInternet and Internettelephone voting for beneficial owners of shares held in “street name”street name will depend on the voting processes of the organization that holds your shares. Therefore, we urge you to carefully review and follow the voting instruction card and any other materials that you receive from that organization.
What are the effects of not voting or abstaining? What are the effects of broker non-votes?
If you do not vote by virtue of not being present in person or by proxy at the Annual Meeting, your shares will not be counted for purposes of determining the existence of a quorum.
Abstentions will be counted for the purposepurposes of determining the existence of a quorum. However, they will not be considered in determining the number of votes cast. Accordingly, an abstention will have no effect on the Director Proposal or the Auditor Proposal.
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Broker non-votes occur on a matter when a broker is not permitted to vote on that matter without instructions from the beneficial owner and instructions are not given. These matters are referred to as “non-routine”considered non-discretionary matters. Broker non-votes will be counted for the purposepurposes of determining the existence of a quorum. The Director Proposal is a “non-routine” matter.and the Say-on-Pay Proposal are non-discretionary matters. Thus, in tabulating the voting resultresults for the Director Proposal and the Say-on-Pay Proposal, shares that constitute broker non-votes are not considered votes cast on the Director Proposal.such proposals. The Auditor Proposal isand the Authorized Shares Proposal are considered a “routine” matterdiscretionary matters, and a broker or other nominee may generally exercise discretionary authority to vote on such proposals.
The following table summarizes the minimum vote needed to approve each proposal and the effect of abstentions and broker non-votes.
| Proposal Number | Proposal Description | Vote Required for Approval | Effect of Abstentions | Effect of Broker Non-Votes | ||||||||||
| 1 | Director Proposal | Plurality | No effect | No effect | ||||||||||
| 2 | Say-on-Pay Proposal | Majority of the votes cast affirmatively or negatively | No effect | No effect | ||||||||||
| 3 | Auditor Proposal | Majority of the votes cast affirmatively or negatively | No effect | Not applicable (1) | ||||||||||
| 4 | Authorized Shares Proposal | Majority of the shares of our common stock issued and outstanding and entitled to vote at the Annual Meeting | Against | Not applicable (1) | ||||||||||
(1) We expect that there will be no broker non-votes with respect to the Auditor Proposal.Proposal and the Authorized Shares Proposal because brokers have discretionary voting authority with respect to these proposals.
What does it mean if I received more than one proxy card or Notice?
If your shares are registered differently or in more than one account, you will receive more than one proxy card or Notice. To make certain all of your shares are voted, please follow the instructions included on the Notice on how to access each proxy card and vote each proxy card via the Internet or by telephone or through the Internet.telephone. If you requested or received paper proxy materials by mail, please complete, sign and return each proxy card to ensure that all of your shares are voted.
What happens if I don’t indicate how to vote my proxy?
If you just sign or submit your proxy card without providing further instructions, your shares will be counted as a vote “for” each of“FOR” the Director NomineesNominee, the Say-on-Pay Proposal, the Auditor Proposal and the AuditorAuthorized Shares Proposal.
What happens if I sell my shares after the record dateRecord Date but before the Annual Meeting?
If you transfer your shares after the Record Date but before the date of the Annual Meeting, you will retain your right to vote at the Annual Meeting (provided that such shares remain outstanding on the date of the Annual Meeting).
What if I change my mind after I return my proxy?
You may revoke your proxy and change your vote at any time before the polls close at the Annual Meeting. You may do this by:
| • | sending a written notice to | ||||||||
| • | voting again at a later time, but prior to the date of the Annual Meeting, via the Internet or by telephone; | ||||||
| • | signing or submitting another proxy card with a later date and returning it before the polls close at the Annual Meeting; or | ||||||
| • | attending the Annual Meeting and voting in person. | ||||||
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Please note, however, that if your shares are held of record by a brokerage firm, bank or other nominee, you must instruct your broker, bank or other nominee that you wish to change your vote by following the procedures on the voting form provided to you by the broker, bank or other nominee. If your shares are held in street name, and you wish to attend and vote at the Annual Meeting, you must bring to the Annual Meeting a legal proxy from the broker, bank or other nominee holding your shares, confirming your beneficial ownership of the shares and giving you the right to vote your shares. Simply attending the Annual Meeting will not constitute a revocation of your proxy.
Who will bear the costs of the proxy solicitation?
We will bear the costs of soliciting proxies. We have retained Morrow Sodali LLC to assist us in our proxy solicitation for an aggregate fee of approximately $8,000, plus out-of-pocket expenses. We expect to pay banks, brokers and other nominees their reasonable expenses for forwarding proxy materials and annual reports to principals and obtaining their voting instructions. In addition to solicitations by mail, our directors, officers and regular employees, without additional remuneration, may solicit proxies by telephone, facsimile, email, personal interviews and other means.
When will the voting results be announced?
We plan to announce preliminary voting results at the Annual Meeting and will publish final results in a Current Report on Form 8-K to be filed with the SEC within four business days following the Annual Meeting.
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PROPOSAL NO. 1—1 – ELECTION OF TWOONE CLASS II DIRECTORSDIRECTOR
Our Board is divided into three classes, with one class of our directors standing for election each year for a three-year term. Directors for each class are elected at the annual meeting of stockholders held in the year in which the term for their class expires and hold office until their resignation or removal or their successors are duly elected and qualified. In accordance with our certificate of incorporation and bylaws,by-laws, our directors may fill existing vacancies on theour Board by appointment. The members of the classes are divided as follows:
| • | the Class I Directors are Peter Barton Hutt, Wilfred E. Jaeger and Roger D. Tung, and their term will expire at | ||||||||
| stockholders; | |||||||||
| • | the Class II Directors are Ronald W. Barrett and Jesper Høiland, | ||||||||
| • | the Class III Directors are Richard H. Aldrich, Thomas G. Auchincloss, Jr. and Christine van Heek, and their term will expire at | ||||||||
Our Board is currently authorized to have eight members. However, Dr. Barrett notified us that he will not stand for re-election at the Annual Meeting. As a result, our Board has approved a decrease in its size to seven members effective as of the Annual Meeting.
Our Board, on the recommendation of our nominating and corporate governance committee, has nominated Mr. Høiland for re-election as a Class II Director at the Annual Meeting. If Mr. Høiland is re-elected at the Annual Meeting, he will serve for a three-year term that will expire at our 2025 annual meeting of stockholders.
Our certificate of incorporation and bylawsby-laws provide that the authorized number of directors may be changed only by resolution of our Board. Our certificate of incorporation and bylawsby-laws also provide that our directors may be removed only for cause by the affirmative vote of the holders of at least 75% of the votes that all our stockholders would be entitled to cast in an annual election of directors, and that any vacancy on our Board, including a vacancy resulting from an enlargement of our Board, may be filled only by vote of a majority of our directors then in office.
If no contrary indication is made, properly executed proxies in the accompanying form are to be voted for Ronald W. Barrett and JesperMr. Høiland or, in the event that either of these candidateshe is not a candidate or is unable to serve as a director at the time of election (which is not currently expected), for any nominee who is designated by our Board to fill the vacancy.
Information Regarding Directors
The information set forth below as to the directors and the nominees for directors has been furnished to us by the directors and the nominees for directors.
Recommendation of theour Board
OUR BOARD UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE ELECTION OF EACH DIRECTOR NOMINEE.MR. HØILAND.
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Nominee for Election to theour Board
For a Three-Year Term Expiring at the
| Name | Age | Present Position with Concert | |||||||||
| Jesper Høiland | 61 | ||||||||||
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Members of theour Board Continuing in Office
Term Expiring at the
| Name | Age | Present Position with Concert | |||||||||
| Richard H. Aldrich | 67 | Director | |||||||||
| Thomas G. Auchincloss, Jr. | 60 | Director | |||||||||
| Christine van Heek | 65 | Director | |||||||||
Richard H. Aldrich is a co-founder of Concert and has served as a member of our Board and as Chairman of the Board since May 2006. Mr. Aldrich is a co-founder of and has been a Partner at Longwood Fund, a life sciences venture capital firm, since December 2010. Prior to co-founding Longwood Fund, Mr. Aldrich co-founded RA Capital Management LLC, a life sciences investment fund, in 2001. Mr. Aldrich has co-founded and helped to build several biotechnology companies including Sirtris Pharmaceuticals, Inc. (acquired by GlaxoSmithKline in 2008), Alnara Pharmaceuticals, Inc. (acquired by Eli Lilly in 2010), Verastem, Inc., Axial Therapeutics, Inc. and TScan Therapeutics, Inc. Mr. Aldrich was also a founding employee of Vertex Pharmaceuticals Incorporated, a pharmaceutical company, where he held the position of Senior Vice President and Chief Business Officer and managed all commercial and operating functions from 1989 to 2001. Prior to joining Vertex, Mr. Aldrich held several management positions at Biogen Inc. Mr. Aldrich also serves on the board of directors of a number of private biotechnology companies. During the last five years, Mr. Aldrich previously served on the board of directors of KalVista Pharmaceuticals, Inc. and OvaScience, Inc. Mr. Aldrich received a B.S. in Management from Boston College and an M.B.A. from the Amos Tuck School at Dartmouth College. We believe that Mr. Aldrich’s broad-based experience in business, including his leadership and board experience at life science companies, and his familiarity with our business as a co-founder of Concert make him a key contributor to our Board.
Thomas G. Auchincloss, Jr. has served as a member of our Board since December 2014. Since September 2013, Mr. Auchincloss has served as Managing Member at Counterpoint Trading Company, LLC, a private investment firm. From August 2007 to September 2013, Mr. Auchincloss was self-employed in private investing. From May 2005 to August 2007, Mr. Auchincloss worked as Chief Financial Officer of Metabolix, Inc., a biomaterials company. Prior to that, Mr. Auchincloss served as a consultant with Metabolix from April 2002 to May 2005, providing business development, financial and strategic consulting services. From 1994 to 2001, Mr. Auchincloss served in a variety of positions at Vertex Pharmaceuticals Incorporated, a pharmaceutical company, most recently as Vice President, Finance and Treasurer. Mr. Auchincloss received a B.S. in Business Administration from Babson College and an M.B.A. in Finance from the Wharton School. We believe that Mr. Auchincloss’ financial and industry experience, including his experience as the chief financial officer of a publicly traded biomaterials company, make him a key contributor to our Board.
Christine van Heek has served as a member of our Board since April 2016. Ms. van Heek has served as an adviser and consultant to several companies in the biopharmaceutical industry. From 1991 to 2003, Ms. van Heek served in various roles at Genzyme Corporation, a biotechnology company, including as Corporate Officer and President, Therapeutics Division; General Manager, Renal Division; and Vice President, Global Marketing. In addition, she has held various sales and marketing positions at Genentech, Inc. and Caremark/HHCA. Ms. van Heek also serves on the board of directors of Visioneering Technologies, Inc. Ms. van Heek received a B.S.N. from the University of Iowa and an M.B.A. from Lindenwood University in St. Louis. We believe that Ms. van Heek’s industry experience, including her extensive experience in strategic roles at a publicly traded biotechnology company, make her a key contributor to our Board.
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Term Expiring at the
2024 Annual Meeting of Stockholders (Class I)
| Name | Age | Present Position with Concert | |||||||||
| Peter Barton Hutt | 87 | Director | |||||||||
| Wilfred E. Jaeger, M.D. | 66 | Director | |||||||||
| Roger D. Tung, Ph.D. | 62 | Director, Chief Executive Officer and President | |||||||||
Peter Barton Hutt has served as a member of our Board of Directors since December 2006. Mr. Hutt has practiced law at Covington & Burling LLP, specializing in food and drug law, since 1960 (except for the period from 1971 to 1975) and currently serves as senior counsel. From 1971 to 1975, he was Chief Counsel for the Food and Drug Administration. Mr. Hutt isalso serves on the board of directors of a membernumber of private companies. During the last five years, Mr. Hutt previously served on the board of directors of Flex Pharma, Inc., Immunomedics, Inc., Moderna, Inc., Immunomedics, Inc. and Q Therapeutics, Inc., each of which is a public biotechnology company, as well as numerous private companies. During the last five years, Mr. Hutt also served as a member of the board of directors of BINDRubius Therapeutics, Inc., Seres Health,Therapeutics, Inc., Xoma Ltd., DBV Technologies SA, a public biotechnology company, and Momenta Pharmaceuticals, Inc., a public biotechnology company.XOMA Corporation. Mr. Hutt received a B.A. from Yale University, an LL.B. from Harvard Law School and an LL.M. from New York University School of Law. We believe that Mr. Hutt’s extensive knowledge of regulatory and legal issues related to drug development and his service on numerous boards of directors allowmake him to be a key contributor to our Board of Directors.Board.
Wilfred E. Jaeger, M.D. has served as a member of our Board of Directors since May 2006. Dr. Jaeger co-founded Three Arch Partners, a venture capitalhealthcare-focused investment firm, in 1993 and has served as a Partner since that time.Managing Member until December 2019. Prior to co-founding Three Arch Partners, Dr. Jaeger was a general partner at Schroder Ventures. He isDr. Jaeger also a member ofserves on the board of directors of Threshold Pharmaceuticals,Neuronetics, Inc., a public pharmaceutical company, and Nevro Corporation, a public medical device company, as well as numerousa number of private companies. During the last five years, Dr. Jaeger previously served on the board of directors of Nevro Corp. and Threshold Pharmaceuticals, Inc. Dr. Jaeger received a B.S. in Biology from the University of British Columbia, hisan M.D. from the University of British Columbia School of Medicine and an M.B.A. from Stanford University. We believe that Dr. Jaeger’s financial and medical knowledge and experience allowmake him to be a key contributor to our Board of Directors.Board.
Roger D. Tung, Ph.D., Ph.D. is our co-founderscientific founder and has served as our President and Chief Executive Officer and as a member of our Board of Directors since April 2006. He is also a member of the board of directors of Flex Pharma, Inc., a public pharmaceutical company. Before founding Concert, Dr. Tung was a founding scientist at Vertex Pharmaceuticals Incorporated, a pharmaceutical company, where he was employed from 1989 to 2005, most recently as its Vice President of Drug Discovery. Prior to Vertex, he held various positions at Merck, Sharp & Dohme Research Laboratories, a global healthcare provider, and The Squibb Institute for Medicinal Chemistry. During the last five years, Dr. Tung previously served on the board of directors of Flex Pharma, Inc. Dr. Tung received a B.A. in Chemistry from Reed College and a Ph.D. in Medicinal Chemistry from the University of Wisconsin-Madison. We believe that Dr. Tung’s detailed knowledge of our CompanyConcert and his 34-yearlong career in the global pharmaceutical and biotechnology industries, including his roles at Vertex, provide a critical contribution to our Board of Directors.
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CORPORATE GOVERNANCE
General
We believe that good corporate governance is important to ensure that the CompanyConcert is managed for the long-term benefit of our stockholders. This section describes key corporate governance practices that we have adopted. We have adopted a code of business conduct and ethics, which applies to all of our employees, officers directors and employees, anddirectors, corporate governance guidelines and charters for our audit committee, our compensation committee and our nominating and corporate governance committee. We have posted copies of our code of business conduct and ethics and corporate governance guidelines, as well as each of our committee charters, on the “Corporate Governance” page of the “Investors” section of our website, www.concertpharma.com, which you can access free of charge. Information contained on theour website is not incorporated by reference in, or considered part of, this proxy statement. We intend to disclose on our website any amendments to, or waivers from, our code of business conduct and ethics that are required to be disclosed by law or NASDAQ listing standards.the Nasdaq Listing Rules. We will also provide copies of these documents as well as our other corporate governance documents, free of charge, to any stockholder upon written request to Concert Pharmaceuticals, Inc., 65 Hayden Avenue, Suite 3000N, Lexington, MA 02421, Attention: Investor Relations.
Director Independence
Under Rule 5605(a)(2), a director will only qualify as an “independent director” if, in the opinion of our Board, that person does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.
In order to be considered independent for purposes of Rule 10A-3, a member of anthe audit committee of a listed company may not, other than in his or her capacity as a member of the audit committee, the Board,board of directors or any other board committee, accept, directly or indirectly, any consulting, advisory or other compensatory fee from the listed company or any of its subsidiaries or otherwise be an affiliated person of the listed company or any of its subsidiaries.
When determining the independence of the members of our compensation committee under the heightened independence requirements contained in the NASDAQNasdaq Listing Rules and Rule 10C-1, our Board is required to consider all factors specifically relevant to determining whether a director has a relationship with us that is material to that director’s ability to be independent from management in connection with the duties of a compensation committee member, including, but not limited to: (1) the source of compensation of that director, including any consulting, advisory or other compensatory fee paid by us to that director; and (2) whether that director is affiliated with the Company,Concert, a subsidiary of the CompanyConcert or an affiliate of a subsidiary of the Company.Concert.
Our Board has reviewed the composition of our Board and its committees and the independence of each director. Based upon information requested from and provided by each director concerning his or her background, employment and affiliations, including family relationships, our Board has determined that each of our directors, with the exception of Dr. Tung, is an “independent director” as defined under Rule 5605(a)(2) of the NASDAQNasdaq Listing Rules. Our Board also determined that Mr. Auchincloss, Dr. Jaeger and Ms. van Heek, who comprise our audit committee, and Dr. Barrett, Mr. HuttHøiland and Mr. Høiland,Dr. Jaeger, who comprise our compensation committee, satisfy the independence standards for such committees established by the SEC and the NASDAQNasdaq Listing Rules, as applicable. In making such determinations, our Board considered the relationships that each such non-employee director has with the CompanyConcert and all other facts and circumstances our Board deemed relevant in determining independence, including the beneficial ownership of our capital stock by each non-employee director.
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Board Leadership Structure
Our Board is currently chaired by Mr. Aldrich, an independent director, who possesses an in-depth knowledge of our business, opportunities and challenges. We believe hethat separation of the positions of Board Chair and Chief Executive Officer reinforces the independence of the Board in its oversight of our business and affairs. We believe that Mr. Aldrich is the person best positioned to ensure that our Board’s time and attention is focused on the most critical matters. In addition, we believe that having an independent Board Chair creates an environment that is more conducive to objective evaluation and oversight of management’s performance, which increases management accountability and improves the ability of the Board to monitor whether management’s actions are in the best interests of the company and its stockholders. As a result, we believe that having an independent Board Chair can enhance the effectiveness of the Board as a whole.
Board Size
Our Board periodically considers its appropriate size, function, needs and composition. Currently, our Board has eight members; however, Dr. Barrett is not standing for re-election at the Annual Meeting. Therefore, following the Annual Meeting, the size of our Board will be reduced to seven members. Our Board may expand or reduce its size further in the future if it determines a change is appropriate. Our nominating and corporate governance committee also periodically reviews the size of our Board and recommends any proposed changes.
Board Diversity
We do not have a formal policy regarding board diversity. However, in considering director nominees, our nominating and corporate governance committee considers, among other factors, diversity of background and perspective, including with respect to age, gender, race, place of residence and specialized experience. Our priority in selecting Board members is the identification of members who will further the interests of our stockholders through their established record of professional accomplishment, the ability to contribute positively to the collaborative culture among Board members, knowledge of our business, understanding of the competitive landscape and adherence to high ethical standards.
The following table provides information related to the gender identity and demographic background of our Board members, as self-identified by our Board members.
| Board Diversity Matrix (As of April 12, 2022) | ||||||||
| Total Number of Directors | 8 | |||||||
| Female | Male | |||||||
| Part I: Gender Identity | ||||||||
| Directors | 1 | 7 | ||||||
| Part II: Demographic Background | ||||||||
| Asian | 0 | 1 | ||||||
| White | 1 | 6 | ||||||
Our Board’s Role in Risk Oversight
Our Board has responsibility for the oversight of the company’sConcert’s risk management processes and, either as a whole or through its committees, regularly discusses with management our major risk exposures, the potential impact of these risks on our business and the steps we take to manage them. The risk oversight process includes receiving regular reports from Board committees and members of senior management to enable our Board to understand the company’sConcert’s risk identification, risk management and risk mitigation strategies with respect to areas of potential material risk, including operations, finance, legal, regulatory, strategic and reputational risk.
The audit committee reviews information regarding liquidity and operations and oversees our management of financial risks. Periodically, the audit committee reviews our policies with respect to risk assessment, risk management, loss prevention and
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regulatory compliance. Oversight by the audit committee includes direct communication with our external auditors and discussions with management regarding significant risk exposures and the actions management has taken to limit, monitor or control such exposures. The compensation committee is responsible for assessing whether any of our compensation policies or programs have the potential to encourage excessive risk-taking. The nominating and corporate governance committee manages risks associated with the independence of theour Board, corporate disclosure practices and potential conflicts of interest. While each committee is responsible for evaluating certain risks and overseeing the management of such risks, the entire Board is regularly informed through committee reports about such risks. Matters of significant strategic risk are considered by our Board as a whole.
Board Meetings
Our Board met six12 times during our fiscal year 2018,2021, including telephonic meetings.meetings, and took action by written consent twice. During the year, each of our directors attended 75% or more of the combined total number of meetings of theour Board and the committees on which he or she served.
Committees of theour Board
We have three standing committees: the audit committee, the compensation committee and the nominating and corporate governance committee. Each of these committees has a written charter approved by our Board. A copy of each charter can be found on the “Corporate Governance” page of the “Investors” section of our website, at www.concertpharma.com.
Audit Committee
The members of our audit committee are Mr. Auchincloss, Dr. Jaeger and Ms. van Heek. Mr. Auchincloss is the chair of the audit committee. Our Board has determined that each of Mr. Auchincloss and Dr. Jaeger qualifies as an audit committee financial expert within the meaning of SEC regulations and the NASDAQNasdaq Listing Rules.
In making this determination, our Board has considered the formal education and nature and scope of each such director’s previous experience, coupled with past and present service on various audit committees. Our audit committee assists our Board in its oversight of our accounting and financial reporting process and the audits of our financial statements. The audit committee met nine times during fiscal year 2018,2021, including telephonic meetings. The audit committee’s responsibilities include:
| • | appointing, approving the compensation of, and assessing the independence of our independent registered public accounting firm; | ||||||||
| • | overseeing the work of our independent registered public accounting firm, including through the receipt and consideration of reports from such firm; | ||||||
| • | reviewing and discussing with management and the independent registered public accounting firm our annual and quarterly financial statements and related disclosures; | ||||||
| • | monitoring our internal control over financial reporting, disclosure controls and procedures and code of business conduct and ethics; | ||||||
| • | overseeing our internal audit function, if any; | ||||||
| • | discussing our risk management policies; | ||||||
| • | establishing policies regarding hiring employees from the independent registered public accounting firm and procedures for the receipt, retention and treatment of accounting related complaints and concerns; | ||||||
| • | meeting independently with our internal auditing staff, independent registered public accounting firm and management; | ||||||
| • | reviewing and approving or ratifying any related person transactions; and | ||||||
| • | preparing the audit committee report required by SEC rules. | ||||||
We believe that the composition of our audit committee meets the requirements for independence under current NASDAQ listing standardsthe Nasdaq Listing Rules and SEC rules and regulations. Our Board has determined that each of Mr. Auchincloss, Dr. Jaeger and Ms. van Heek is independent as independence is currently defined in applicable NASDAQ listing standards.the Nasdaq Listing Rules and Rule 10A-3 of the Exchange Act.
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Compensation Committee
The members of our compensation committee are Dr. Barrett, Mr. HuttHøiland and Mr. Høiland.Dr. Jaeger. Dr. Barrett is the chair of the compensation committee. Our compensation committee assists our Board in the discharge of its responsibilities relating to the compensation of our executive officers. The compensation committee met six times during fiscal year 2018.2021, including telephonic meetings. The compensation committee’s responsibilities include:
| • | reviewing and making recommendations to our Board with respect to the compensation of our chief executive officer, and reviewing and approving, or making recommendations to our Board with respect to, the compensation of our | ||||||||
| • | overseeing and administering our cash and equity incentive plans; | ||||||
| • | reviewing and making recommendations to our Board with respect to director compensation; | ||||||
| • | appointing, compensating and overseeing the work of any compensation consultant, legal counsel or other adviser retained by the compensation committee; | ||||||
| • | conducting an independence assessment with respect to any compensation consultant, legal counsel or other adviser retained by the compensation committee; | ||||||
| • | reviewing and discussing with management our director and executive compensation disclosure required to be included in our | ||||||
| • | preparing the compensation committee report required by SEC rules, if applicable. | ||||||
The compensation committee may delegate to one or more executive officers the power to grant options or other stock awards pursuant to our equity incentive plans to employees who are not directors or executive officers, subject to certain limitations. The compensation committee may also form and delegate its responsibilities to one or more subcommittees of theour Board.
We believe that the composition of our compensation committee meets the requirements for independence under current NASDAQ listing standardsthe Nasdaq Listing Rules and SEC rules and regulations. Our Board has determined that each of Dr. Barrett, Mr. HuttHøiland and Mr. HøilandDr. Jaeger is independent as independence is currently defined in applicable NASDAQ listing standards.the Nasdaq Listing Rules and Rule 10C-1 of the Exchange Act.
Nominating and Corporate Governance Committee
The members of our nominating and corporate governance committee are Mr. Aldrich and Mr. Hutt. Mr. Aldrich is the chair of the nominating and corporate governance committee. The nominating and corporate governance committee met one timetwo times during fiscal year 2018.2021, including telephonic meetings. The nominating and corporate governance committee’s responsibilities include:
| • | identifying individuals qualified to become | ||||||||
| • | recommending to our Board the persons to be nominated for election as directors and to each committee of our Board; | ||||||
| • | reviewing and making recommendations to our Board with respect to management | ||||||
| • | developing and recommending corporate governance principles to | ||||||
| • | overseeing periodic evaluations of | ||||||
We believe that the composition of our nominating and corporate governance committee meets the requirements for independence under current NASDAQ listing standardsthe Nasdaq Listing Rules and SEC rules and regulations. Our Board has determined that each of Mr. Aldrich and Mr. Hutt is independent as independence is currently defined in applicable NASDAQ listing standards.the Nasdaq Listing Rules.
Code of Business Conduct and Ethics
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are required by law or NASDAQ listing standardsthe Nasdaq Listing Rules concerning any amendments to, or waivers from, any provision of this code. Information contained on our website is not incorporated by reference in, or considered part of, this proxy statement.
Policy on Trading, Pledging and Hedging of Company Stock
Certain transactions in our securities (such as short sales and purchases and sales of put and call options) create a heightened compliance risk or could create the appearance of misalignment between management and stockholders. In addition, securities held in a margin account or pledged as collateral may be sold without consent if the owner fails to meet a margin call or defaults on the loan, thus creating the risk that a sale may occur at a time when an officer or director is aware of material, non-public information or otherwise is not permitted to trade in our securities. Our insider trading policy expressly prohibits short sales of our securities and purchases and sales of puts, calls and other derivative securities based on our securities by our employees, officers and directors. Our insider trading policy also expressly prohibits our employees, officers and directors from purchasing our securities on margin, borrowing against our securities held in a margin account and pledging our securities as collateral for a loan; however, an exception may be granted where a person wishes to pledge our securities as collateral for a loan and clearly demonstrates the financial capacity to repay the loan without resorting to the pledged securities.
Related Person Transactions
Our Board has adopted written policies and procedures for the review of any transaction, arrangement or relationship in which Concert is a participant, the amount involved exceeds $120,000 and one of our executive officers, directors, director nominees or 5% stockholders, or their immediate family members, each of whom we refer to as a “related person,” has a direct or indirect material interest.
In November 2021, we closed a financing (the “2021 Financing”) pursuant to which we received aggregate gross proceeds of $65.0 million. The 2021 Financing consisted of the sale of (i) 13,997 shares of Series X1 preferred stock, (ii) 2,253,000 shares of common stock, (iii) warrants to purchase up to 16,250 shares of Series X1 preferred stock and (iv) a portion of our right to receive potential future AVP-786 royalties under a development and license agreement with Avanir Pharmaceuticals, Inc. (the “Avanir Agreement”). One of the investors in the 2021 Financing was RA Capital Healthcare Fund, L.P. (“RA Capital”). At the time of entering into the 2021 Financing, RA Capital held greater than 5% of our outstanding common stock, and two members of our board of directors, Mr. Aldrich and Dr. Tung, maintained minority, non-controlling interests in RA Capital. RA Capital purchased 7,500 shares of Series X1 preferred stock, warrants to purchase up to 7,500 shares of Series X1 preferred stock and 16.2%, which could potentially increase up to 23.1%, of our right to receive potential future AVP-786 royalties under the Avanir Agreement for $30.0 million in cash. Mr. Aldrich and Dr. Tung recused themselves from the negotiation of the 2021 Financing, and our Board (with Mr. Aldrich and Dr. Tung abstaining) and audit committee approved the 2021 Financing in accordance with our related person transaction policy.
Other than the 2021 Financing, we have not engaged in any related person transactions since January 1, 2021.
Director Nomination Process
Our nominating and corporate governance committee is responsible for identifying individuals qualified to serve as directors, consistent with criteria approved by our Board, and recommending the persons to be nominated for election as directors.
Director Qualifications
In evaluating director nominees, theour nominating and corporate governance committee will consider, among other things, the following factors:
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| • | reputation for personal and professional integrity, honesty and adherence to high ethical standards; | ||||||||
| • | demonstrated business acumen, experience and ability to exercise sound judgments in matters that relate to the current and long-term objectives of | ||||||
| Concert; | |||||||
| • | strong finance experience; | ||||||
| • | commitment to understanding | ||||||
| • | interest and ability to understand the sometimes conflicting interests of the various constituencies of | ||||||
| • | diversity of expertise and experience in substantive matters pertaining to our business relative to our other Board members; | ||||||
| • | diversity of background and perspective, including with respect to age, gender, race, place of residence and specialized experience; and | ||||||
| • | practical and mature business judgment, including the ability to make independent analytical inquiries. | ||||||
The nominating and corporate governance committee’s goal is to assemble a Board that brings to the CompanyConcert a variety of perspectives and skills derived from high quality business and professional experience. Moreover, the nominating and corporate governance committee believes that the background and qualifications of theour Board, considered as a group, should provide a significant mix of experience, knowledge and abilities that will allow theour Board to fulfill its responsibilities. Nominees are not discriminated against on the basis of race, religion, national origin, sex, sexual orientation, disability or any other basis proscribed by law.
The nominating and corporate governance committee has not adopted a formal policy with respect to a fixed set of specific
minimum qualifications for its candidates for membership on theour Board. The nominating and corporate governance committee may consider such other facts, including, without limitation, diversity, as it may deem are in the best interests of the CompanyConcert and its stockholders. The nominating and corporate governance committee further believes it is appropriate for at least one member of our Board to meet the criteria for an “audit committee financial expert” as that phrase is defined under the regulations promulgated by the SEC, and that a majority of the members of our Board be independent as required under the NASDAQ qualification standards.Nasdaq Listing Rules. The nominating and corporate governance committee believes it is appropriate for our chief executive officer to serve as a member of our Board. Our directors’ performance and qualification criteria are reviewed periodically by the nominating and corporate governance committee.
Identification and Evaluation of Nominees for Directors
The nominating and corporate governance committee identifies nominees for director by first evaluating the current members of our Board willing to continue in service. Current members with qualifications and skills that are consistent with the nominating and corporate governance committee’s criteria for Board service and who are willing to continue in service are considered for re-nomination, balancing the value of continuity of service by existing members of our Board with that of obtaining a new perspective or expertise.
If any member of our Board does not wish to continue in service or if our Board decides not to re-nominate a member for re-election and desires to fill the vacancy on the Board, the nominating and corporate governance committee identifieswill work to identify a new nominee that meets the criteria above. The nominating and corporate governance committee generally inquires of our Board and members of management for their recommendations. The nominating and corporate governance committee may also review the composition and qualification of the boards of directors of our competitors, and may seek input from industry experts or analysts. The nominating and corporate governance committee reviews the qualifications, experience and background of suggested candidates. Final candidates, if other than our current directors, would be interviewed by the members of the nominating and corporate governance committee and by certain of our other independent directors and executive management. In making its determinations, the nominating and corporate governance committee evaluates each individual in the context of our Board as a whole, with the objective of assembling a group that can best contribute to the success of the CompanyConcert and represent stockholder interests through the exercise of sound judgment. After review and deliberation of all feedback and data, the nominating and corporate governance committee makes its recommendation to our Board.
We have not received director candidate recommendations from our stockholders and do not have a formal policy regarding consideration of such recommendations. However, any recommendations received from stockholders will be evaluated in the
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same manner that potential nominees suggested by Board members, management or other parties are evaluated. We do not intend to treat stockholder recommendations in any manner differently from other recommendations.
Under our bylaws,by-laws, stockholders wishing to nominate a candidate for director should write to our corporate secretary. In order to give the nominating and corporate governance committee sufficient time to evaluate a recommended candidate and/or include the candidate in our proxy statement for the 2020 Annual Meeting,2023 annual meeting of stockholders, the recommendation should be received by our corporate secretary at our principal executive offices in accordance with our procedures detailed in the section below entitled “Other Matters – Stockholder Proposals.”. Such submissions must state the nominee’s name, together with appropriate biographical information and background materials, and information with respect to the stockholder or group of stockholders making the recommendation, including the number of shares of common stock owned by such stockholder or group of stockholders, as well as other information required by our bylaws.by-laws. We may require any proposed nominee to furnish such other information as we may reasonably require to determine the eligibility of such proposed nominee to serve as an independent director or that could be material to a reasonable stockholder’s understanding of the independence, or lack thereof, of such proposed nominee.
Director Attendance at Annual Meetings
Although the CompanyConcert does not have a formal policy regarding attendance by members of our Board at ourthe Annual Meeting, we encourage all of our directors to attend. EightSeven of our eight directors attended our 20182021 annual meeting of stockholders.
Communications with Our Board
Stockholders seeking to communicate with our Board should submit their written comments to Concert Pharmaceuticals, Inc., 65 Hayden Avenue, Suite 3000N, Lexington, MA 02421, Attention: Corporate Secretary. The corporate secretary will forward such communications to each member of our Board;Board, provided that, if in the opinion of our corporate secretary it would be inappropriate to send a particular stockholder communication to a specific director, such communication will only be sent to the remaining directors (subject to the remaining directors concurring with such opinion).
Director Compensation
During 2018,2021, we did not provide any compensation to Dr. Tung, our President and Chief Executive Officer, for his service as a member of our Board. Dr. Tung’s compensation as an executive officer is set forth below under “Executive Compensation-2017Compensation – 2021 Summary Compensation Table.”
Under our director compensation program, we pay our non-employee directors a cash retainer for their service on theour Board of Directors and for their service on each committee of which the director is a member. The Chairman of the Board of Directors and the chairschair of each committee receive higher retainers for such service. These fees are payable quarterly in arrears, in four equal quarterly installments on the last day of each quarter, provided that the amount of such payment is prorated for any portion of such quarter that the director is not serving on our Board of Directors. Theor a committee.
For 2021, and continuing for 2022, the fees paid to non-employee directors for their service on theour Board of Directors and for their service on each committee of theour Board of Directors of which the director is a member are as follows:
| Member Annual Retainer ($) | Chair Annual Retainer ($) | |||||||||||||
| Board of Directors | 40,000 | 70,000 | ||||||||||||
| Audit Committee | 10,000 | 20,000 | ||||||||||||
| Compensation Committee | 7,500 | 15,000 | ||||||||||||
| Nominating and Corporate Governance Committee | 5,000 | 10,000 | ||||||||||||
| Annual Member Fee ($) | Chairman Annual Fee ($) | |||||
| Board of Directors | 40,000 | 70,000 | ||||
| Audit Committee | 7,500 | 15,000 | ||||
| Compensation Committee | 6,250 | 12,500 | ||||
| Nominating and Corporate Governance Committee | 4,000 | 8,000 | ||||
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on the date that is one business day prior to the date of our next annual meeting of stockholders (if earlier than the one-year anniversary of the annual meeting of stockholders that marks the beginning of the one-year period).
In addition, on the date of the first Board meeting held after each annual meeting of stockholders, each non-employee director that has served on our Board for at least six months will receive an equity award, comprised of an option to purchase shares of our common stock and restricted stock units, that targets the 50th percentile of equity awards made by our peer group companies to their respective directors on an annual basis based on value and percent of company, as determined by Radford, our independent compensation consultant. Half of the award will consist of an option, the number of shares underlying which will be based on the average fair value of our common stock over the 30-day period ending on the March 31 preceding the date of grant. The other half of the award will consist of a number of restricted stock units equal to half of the number of shares underlying the option. These options vestswill vest in equal quarterly installments over a one-year period measured from the date of grant, but vests in full on the earlier of the date of the Company's annual meeting of stockholders held in the year following the grant date or the one-year anniversary of the grant date, subject to the director’s continued service as a director.
Concert.
In addition, under our director compensation program, each new non-employee director elected to our Board will receive an equity award, comprised of Directors receives an option to purchase 25,000 shares of our common stock. Eachstock and restricted stock units, that targets two times the 50th percentile of theseequity awards made by our peer group companies to their respective directors on an annual basis based on value and percent of company, as determined by Radford. Half of the award will consist of an option, the number of shares underlying which will be based on the average fair value of our common stock over the 30-day period ending on the day before the director was elected to our Board. The other half of the award will consist of a number of restricted stock units equal to half of the number of shares underlying the option. These options will vest in equal quarterly installments over a three-year period measured from the date of grant, subject to the director’s continued service as a director, anddirector. These restricted stock units will become vested and exercisable in full upon a change in control of our Company. Further, on the date of the first board meeting held after each annual meeting of stockholders, each non-employee director that has served on our Board of Directors for at least six months receives an option to purchase 10,000 shares of our common stock. Each of these options vest in equal quarterlyannual installments over a one-yearthree-year period measured from the date of grant, subject to the director’s continued service as a director,director. These options and restricted stock units will become vested and exercisablealso vest in full upon a change in control of our Company. Concert.
The exercise price of each option isall options granted to non-employee directors will equal to the fairclosing market value of a shareprice of our common stock on the date of grant.
committee meetings.
The following table sets forth information regarding compensation earned by or awarded to our non-employee directors during 2018.2021.
| Name | Fees earned or paid in cash ($) | Option awards ($) (1) | Stock awards ($) (2) | Total ($) | |||||||||||||||||||||||||
| Richard H. Aldrich | 80,000 | (3) | 27,221 | 21,833 | 129,054 | ||||||||||||||||||||||||
| Thomas G. Auchincloss, Jr. | 60,000 | 27,221 | 21,833 | 109,054 | |||||||||||||||||||||||||
| Ronald W. Barrett | 55,000 | 27,221 | 21,833 | 104,054 | |||||||||||||||||||||||||
| Jesper Høiland | 47,500 | 27,221 | 21,833 | 96,554 | |||||||||||||||||||||||||
| Peter Barton Hutt | 45,000 | 27,221 | 21,833 | 94,054 | |||||||||||||||||||||||||
| Wilfred E. Jaeger | 57,500 | 27,221 | 21,833 | 106,554 | |||||||||||||||||||||||||
| Christine van Heek | 50,000 | (4) | 27,221 | 21,833 | 99,054 | ||||||||||||||||||||||||
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| Name | Fees earned or paid in cash or options ($) (1) | Option awards ($)(2) | Total ($) | ||||||
| Richard H. Aldrich | 71,865 | 133,748 | 205,613 | ||||||
| Thomas G. Auchincloss, Jr. | 55,000 | 133,748 | 188,748 | ||||||
| Ronald W. Barrett, Ph.D. | 51,367 | 133,748 | 185,115 | ||||||
| Meghan FitzGerald, Ph.D. | 30,313 | 133,748 | 164,061 | ||||||
| Christine van Heek | 47,500 | 133,748 | 181,248 | ||||||
| Peter Barton Hutt | 47,573 | 133,748 | 181,321 | ||||||
| Wilfred E. Jaeger, M.D. | 47,500 | 133,748 | 181,248 | ||||||
| Wendell Wierenga, Ph.D. | 43,547 | 133,748 | 177,295 | ||||||
| (1) | |||||
| The amounts included in the “Option awards” column reflect the aggregate grant date fair value of | |||||
| (2) | The amounts included in the “Stock awards” column reflect the aggregate grant date fair value of restricted stock units granted during 2021, calculated in accordance with FASB ASC Topic 718. Such aggregate grant date fair values do not take into account any estimated forfeitures related to service-vesting conditions. The amounts reported in this column reflect the accounting cost for these stock | ||||
| restricted stock unit awards was as follows: Mr. Aldrich, 5,125; Mr. Auchincloss, 5,125; Dr. Barrett, 5,125; Mr. Høiland, 5,125; Mr. Hutt, 5,125; Dr. Jaeger, 5,125; and Ms. van Heek, 5,125. | |||||
| (3) | Mr. Aldrich | ||||
| 10, 2021. | |||||
| (4) | Ms. van Heek | ||||
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The audit committee is appointed by theour Board to assist theour Board in fulfilling its oversight responsibilities with respect to (1) the integrity of our financial statements and financial reporting process and systems of internal controls regarding finance, accounting, and compliance with legal and regulatory requirements, (2) the qualifications, independence and performance of our independent registered public accounting firm, (3) the performance of our internal audit function, if any, and (4) other matters as set forth in the charter of the audit committee approved by theour Board.
Management is responsible for the preparation of the Company’sConcert’s financial statements and the financial reporting process, including its system of internal control over financial reporting and its disclosure controls and procedures. The independent registered public accounting firm is responsible for performing an audit of the Company’sConcert’s financial statements in accordance with the standards of the Public Company Accounting Oversight Board or (“PCAOB”) and issuing a report thereon. The audit committee’s responsibility is to monitor and oversee these processes.
In connection with these responsibilities, the audit committee reviewed and discussed with management and the independent registered public accounting firm the audited consolidated financial statements of the CompanyConcert for the fiscal year ended December 31, 2018.2021. The audit committee also discussed with the independent registered public accounting firm the matters required to be discussed by the PCAOB’s Auditing Standard 1301, Communication with Audit Committees.applicable requirements of the PCAOB and SEC. In addition, the audit committee received written communications from the independent registered public accounting firm confirming its independence as required by the applicable requirements of the PCAOB and has discussed with the independent registered public accounting firm its independence.
Based on the reviews and discussions referred to above, the audit committee recommended to theour Board that the audited consolidated financial statements of the CompanyConcert be included in its Annual Report on Form 10-K for the fiscal year ended December 31, 20182021 that was filed with the SEC.
Thomas G. Auchincloss, ChairmanChair
Wilfred E. Jaeger
Christine van Heek
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EXECUTIVE OFFICERS
The following table sets forth the name, age and positions of each of our executive officers as of February 22, 2019.
March 31, 2022.
| Name | Age | Position(s) | ||||||||
| Roger D. Tung, | 62 | President, | ||||||||
| Marc A. Becker | 50 | Chief Financial Officer | ||||||||
| James V. Cassella, Ph.D. | 67 | Chief Development Officer | ||||||||
| Jeffrey A. Munsie | 44 | Chief Legal Officer and Secretary | ||||||||
| Nancy Stuart | 64 | Chief Operating Officer | ||||||||
The biography of Dr. Tung can be found under “Proposal“Proposal No. 1:1 – Election of One Class I Directors - Nominees for Election to theII Director – Members of our Board -Continuing in Office – Term Expiring at the 20212024 Annual Meeting of Stockholders (Class I).”
Marc A.Becker has served as our Chief Financial Officer and principal financial officer since January 2018. Prior to joining Concert, Mr. Becker served as the Chief Financial Officer of CRISPR Therapeutics AG, a publicly traded biotechnology company, from February 2016 to September 2017. From January 2012 to February 2016, Mr. Becker wasserved as the Chief Financial Officer of rEVO Biologics, Inc., a biotechnology company. Prior to rEVO Biologics, Mr. Becker held roles of increasing responsibility at Genzyme Corporation, a biotechnology company subsequently acquired by Sanofi S.A., from August 2001 to October 2011, culminating in Vice President, Finance. Mr. Becker received an M.B.A. from Babson College and a B.S. in Business Administration from the University of Massachusetts and an M.B.A. from Babson College and was licensed as a certified public accountant.
James V. Cassella, Ph.D. has served as our Chief Development Officer since February 2015. Prior to joining Concert, Dr. Cassella served as Executive Vice President, Research and Development and Chief Scientific Officer of Alexza Pharmaceuticals, Inc., a biotechnology company, from July 2012 to January 2015 and served as its Senior Vice President, Research and Development from June 2004 to July 2012. From April 1989 to April 2004, Dr. Cassella held various management positions at Neurogen Corporation, a publicly traded biotechnology company. Prior to Neurogen, Dr. Cassella was Assistant Professor of Neuroscience at Oberlin College. Dr. Cassella also serves on the board of directors of Trevi Therapeutics, Inc. Dr. Cassella received a B.A. in Psychology from the University of New Haven and a Ph.D. in Physiological Psychology from Dartmouth College and completed a postdoctoral fellowship in the Department of Psychiatry at the Yale University School of MedicineMedicine.
Jeffrey A. Munsie has served as our Chief Legal Officer and Secretary since September 2019. Prior to joining Concert, Mr. Munsie served as General Counsel, Head of Corporate Operations and Secretary at Merrimack Pharmaceuticals, Inc., a biopharmaceutical company, until July 2019. Mr. Munsie joined Merrimack in February 2011 and became Secretary in August 2011, General Counsel in January 2013 and Head of Corporate Operations in March 2017. Previously, Mr. Munsie was Counsel in the corporate department at Wilmer Cutler Pickering Hale and Dorr LLP, a law firm, where he practiced from 2002 to January 2011. Mr. Munsie received an A.B. from Dartmouth College and a B.A. in PsychologyJ.D. from the University of New Haven.Harvard Law School.
Nancy Stuart has served as our Chief Operating Officer since October 2007 and was our Senior Vice President, Corporate Strategy and Operations from July 2006 to October 2007. Prior to joining Concert, Ms. Stuart held various business operations and business development positions at Amgen Inc., a biopharmaceutical company, Kinetix Pharmaceuticals, Inc., a pharmaceutical company subsequently acquired by Amgen, Scion Pharmaceuticals, Inc., a pharmaceutical company, Vertex Pharmaceuticals Incorporated, a pharmaceutical company, and Genzyme Corporation.Corporation, a biotechnology company. Ms. Stuart holdsalso serves on the board of directors of KalVista Pharmaceuticals, Inc. Ms. Stuart received a B.S. from the University of Michigan and an M.B.A. from the Simmons College Graduate School of Management.
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EXECUTIVE COMPENSATION
The following table sets forth information regarding total compensation awarded to, earned by and paid to each individual who served as our chief executive officer during the year ended December 31, 20182021 and our two most highly-compensated executive officers (other than our chief executive officer) who were serving as executive officers as of December 31, 20182021 for services rendered in all capacities to the CompanyConcert for the years indicated below. We refer to these individuals as our “named executive officers”.officers.”
| Name and principal position | Year | Salary ($) | Bonus ($) | Option awards ($) (1) | Stock awards ($) (2) | Non-equity incentive plan compensation ($) (3) | All other compensation ($) (4) | Total ($) | |||||||||||||||||||||||||||||||||||||||||||||
| Roger D. Tung | 2021 | 599,426 | — | 1,641,743 | 905,751 | 367,598 | 12,264 | 3,526,782 | |||||||||||||||||||||||||||||||||||||||||||||
| President and Chief Executive Officer | 2020 | 581,967 | — | 1,011,657 | 1,098,957 | 320,082 | 12,114 | 3,024,777 | |||||||||||||||||||||||||||||||||||||||||||||
Marc A. Becker (5) | 2021 | 428,595 | — | 415,241 | 283,619 | 238,942 | 9,510 | 1,375,907 | |||||||||||||||||||||||||||||||||||||||||||||
| Chief Financial Officer | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| James V. Cassella | 2021 | 464,152 | — | 483,713 | 283,619 | 258,765 | 15,558 | 1,505,807 | |||||||||||||||||||||||||||||||||||||||||||||
| Chief Development Officer | 2020 | 450,633 | — | 283,144 | 306,708 | 225,317 | 15,408 | 1,281,210 | |||||||||||||||||||||||||||||||||||||||||||||
| Name | Year | Salary ($) | Bonus ($) | Option awards ($) (3) | Stock awards ($) | Non-equity incentive plan compensation ($) (5) | All other compensation ($) (6) | Total ($) | |||||||||||||||
| Roger D. Tung, Ph.D. | 2018 | 535,511 | — | 3,761,860 | — | 300,421 | 10,056 | 4,607,848 | |||||||||||||||
| President and Chief Executive Officer | 2017 | 517,402 | — | 1,496,440 | 1,109,600 (4) | 297,506 | 9,906 | 3,430,854 | |||||||||||||||
| Nancy Stuart | 2018 | 412,186 | — | 1,316,651 | — | 168,172 | 11,022 | 1,908,031 | |||||||||||||||
| Chief Operating Officer | 2017 | 398,247 | — | 523,754 | 832,200 (4) | 183,194 | 9,906 | 1,947,301 | |||||||||||||||
Marc Becker (1) Chief Financial Officer | 2018 | 375,682 | 30,000 (2) | 1,880,930 | — | 155,040 | 8,880 | 2,450,532 | |||||||||||||||
| (1) | ||||||||
The amounts included in the “Option awards” column reflect the aggregate grant date fair value of option awards granted | ||||||||
| (2) | The | |||||||
| The amounts included in the “Non-equity incentive plan compensation” column represent cash bonuses earned under our | ||||||||
| The amounts included in the “All other compensation” column | ||||||||
| (5) | Mr. Becker was not a named executive officer for the fiscal year ended December 31, 2020, but is a named executive officer for the fiscal year ended December 31, 2021. | |||||||
Narrative to Summary Compensation Table
We review compensation annually for all employees, including our executives.executive officers. In setting executive officer base salaries and target incentive bonus levels, determining actual incentive bonus amounts and granting equity incentive awards, we consider compensation for comparable positions in the market, the historical compensation levels of our executives,executive officers, individual performance as compared to our expectations and objectives, our desire to motivate our employeesexecutive officers to achieve short- and long-term results that are in the best interests of our stockholders, the highly competitive market for biotechnology executives and a long-term commitment to our Company.Concert. We do not target a specific competitive position or a specific mix of compensation among base salary, bonus or long-term incentives.
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Our compensation committee has primary responsibility for determining the compensation of our executive officers.officers other than our chief executive officer. Our Board has primary responsibility for determining the compensation of our chief executive officer based on the recommendation of our compensation committee. Our compensation committee typically reviews and discusses proposed compensation with theour chief executive officer for all executivesexecutive officers other than for the chief executive officer. The compensation committee, without the applicable members of management present, discusses recommendations for management and ultimately approves the compensation of our executive officers.himself. During 2018,2021, our compensation committee engaged Radford as its independent compensation consultant to review our executive compensation peer group and program design and to assist with assessing our executives’executive officers’ compensation relative to those at comparable companies. Our compensation committee considered the relationship that Radford has with us, the members of our Board of Directors and our executive officers. Based on the committee’s evaluation, the compensation committee has determined that Radford is independent and that theirits work has not raised any conflicts of interest.
Radford assisted the compensation committee in conducting a competitive compensation assessment for our executive officers for the fiscal year ended December 31, 2018.2021. In evaluating the total compensation of our executive officers, the compensation committee, with the assistance of Radford, reviewed compensation information from our peer group companies. Radford then supplemented the peer group proxy information with published survey data, which provided a broader market representation of companies and deeper position reporting.
Base salary. In 2018, the base salaries for Dr. Tung, Ms. Stuart and Mr. Becker were $535,511, $412,186 and $375,682, respectively. We use base salaries to recognize the experience, skills, knowledge and responsibilities required of all our employees, including our named executive officers. None of our named executive officers is currently party to an employment agreement or other agreement or arrangement that provides for automatic or scheduled increases in base salary. In December 2021 and January 2022, our compensation committee, and our Board with respect to our chief executive officer, reviewed the base salaries for our named executive officers and approved a 3.5% increase for 2022 for each named executive officer based on their overall performance in 2021 and their increased level of experience, and to ensure that their salaries remained competitive with those of similarly situated executives in our peer group. The 2021 and 2022 base salaries for our named executive officers are set forth in the following table.
| Name | 2021 Base Salary ($) | 2022 Base Salary ($) | ||||||||||||
| Roger D. Tung | 599,426 | 620,406 | ||||||||||||
| Marc A. Becker | 428,595 | 443,595 | ||||||||||||
| James V. Cassella | 464,152 | 480,397 | ||||||||||||
Annual bonus. Pursuant to our executive bonus program for 2018,2021, our Board of Directors established and approved annual bonus targets based on the achievement of specified corporate goals. The target bonus amounts for the named executive officers were 50% of base salary for Dr. Tung and 40% of base salary for each of Ms. Stuart and Mr. Becker. OurFor 2021, our corporate goals are typicallywere generally focused on the achievement of specific research, clinical, regulatory,pipeline and financial goals, with an emphasis on advancing our clinical trials and strategic goals.raising additional capital. We considerconsidered these to be difficult to attain, conducive to the creation of stockholder value and designed to contribute to our current and future financial success. The corporate goals for 2018 were to identify new candidate compounds, advance our CTP-543 and CTP-692 programs, and raise capital.
In January 2019, the2022, our compensation committee and Board conducted a review to determine and approve the attainment of such corporate goals and to assess the individual performance of each of our named executive officers. Based uponon such review and assessment and the
recommendation of our compensation committee, our Board determined that we had overachieved on our corporate goals at a level of 111.5% of target, primarily due to the substantial advancement of our clinical trials. In addition, our Board determined that Dr. Tung’s individual performance had been at a level of 100% of target, that Mr. Becker’s individual performance had been at a level of 125% of target due to his leadership with respect to corporate strategy and fundraising and that Dr. Cassella’s individual performance had been at a level of 125% of target due to his success in progressing our clinical trials during the coronavirus (COVID-19) pandemic. To determine the bonus amounts, the corporate achievement level was multiplied by the individual achievement level. As such, our Board approved cash incentive bonusesbonus payments for each of $300,421 to Dr. Tung, $168,172 to Ms. Stuartour named executive officers for 2021, which are set forth in the following table together with the target bonus amounts (as a percentage of base salary) and $155,040 to Mr. Becker for 2018.the actual achievement of corporate goals and individual performance (as a percentage of target).
| Name | 2021 Target Bonus (%) | Achievement of 2021 Corporate Goals (%) | 2021 Individual Performance (%) | 2021 Actual Bonus ($) | ||||||||||||||||||||||
| Roger D. Tung | 55 | 111.5 | 100 | 367,598 | ||||||||||||||||||||||
| Marc A. Becker | 40 | 111.5 | 125 | 238,942 | ||||||||||||||||||||||
| James V. Cassella | 40 | 111.5 | 125 | 258,765 | ||||||||||||||||||||||
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Equity incentives. Although we do not have a formal policy with respect to the grant of equity incentive awards to our executive officers, or any formal equity ownership guidelines applicable to them, we believe that equity grants provide our executivesexecutive officers with a strong link to our long-term performance, create an ownership culture and help to align the interests of our executivesexecutive officers and our stockholders. We typically grant equity awards with a time-based vesting feature. We believe that such awards are inherently performance-based because the value realized by our executive officers, if any, is directly tied to the appreciation of our stock. In addition, we believe that equity grantsawards with a time-based vesting feature promote executive retention because this feature incentivizes our executive officers to remain in our employment during the vesting period. Accordingly, we
We typically grant stock option awards at the start of employment to each executive officer and our other employees, and our compensation committee and Board of Directors periodically review the equity incentive compensation of our named executive officers and other employees, and from time to time, may grant equity incentive awards to them.
For stock options, the option exercise price is equal to the fairclosing market valueprice of our common stock on the date of grant. Time vested stockStock option grants made in connection with the commencement of employment with us typically vest 25% on the first anniversary of the date of grant or, if earlier, the initial employment date (the "vesting commencement date"), and 6.25% vest per quarterin equal quarterly installments thereafter through the fourth anniversary of the vesting commencementinitial employment date. Other stock option grants generallytypically vest 6.25% per quarterin equal quarterly installments through the fourth anniversary of the vesting commencement date.date of grant.
Restricted stock units typically vest in equal annual installments through the third anniversary of the date of grant.
In January 2018, we2021, our Board granted each of Dr. Tung, Ms. Stuart and Mr. Beckerour named executive officers an option to purchase 200,000, 70,000 and 100,000the number of shares of our common stock respectively. The vesting conditions applicable to suchas set forth in the following table and restricted stock units are describedas set forth in the footnotes to the "Outstanding Equity Awards at 2018 Fiscal Year End Table" below.following table.
| Name | Number of Shares Subject to Option (#) | Number of Restricted Stock Units (#) | ||||||||||||
| Roger D. Tung | 205,000 | 69,300 | ||||||||||||
| Marc A. Becker | 51,850 | 21,700 | ||||||||||||
| James V. Cassella | 60,400 | 21,700 | ||||||||||||
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Outstanding Equity Awards at 20182021 Fiscal Year End Table
The following table sets forth information regarding outstanding equity awards held by our named executive officers as of December 31, 2018.2021.
| Options awards | Stock awards | |||||||||||||||||||||||||||||||
| Name | Number of securities underlying unexercised options (#) exercisable | Number of securities underlying unexercised options (#) unexercisable | Option exercise price ($) | Option expiration date | Number of shares or units of stock that have not vested (#) | Market value of shares or units of stock that have not vested ($) (1) | ||||||||||||||||||||||||||
| Roger D. Tung | 203,300 | — | 8.40 | 6/10/2024 | ||||||||||||||||||||||||||||
| 170,000 | — | 16.85 | 1/7/2026 | |||||||||||||||||||||||||||||
| 200,000 | — | 10.97 | 1/4/2027 | |||||||||||||||||||||||||||||
| 187,500 | 12,500 | (2) | 27.59 | 1/4/2028 | ||||||||||||||||||||||||||||
| 137,500 | 62,500 | (3) | 13.93 | 1/4/2029 | ||||||||||||||||||||||||||||
| 66,325 | 85,275 | (4) | 10.87 | 2/13/2030 | ||||||||||||||||||||||||||||
| 38,438 | 166,562 | (5) | 13.07 | 1/4/2031 | ||||||||||||||||||||||||||||
| 67,400 | (6) | 212,310 | ||||||||||||||||||||||||||||||
| 69,300 | (7) | 218,295 | ||||||||||||||||||||||||||||||
| Marc A. Becker | 93,750 | 6,250 | (2) | 27.59 | 1/4/2028 | |||||||||||||||||||||||||||
| 75,625 | 34,375 | (3) | 13.93 | 1/4/2029 | ||||||||||||||||||||||||||||
| 18,563 | 23,867 | (4) | 10.87 | 2/13/2030 | ||||||||||||||||||||||||||||
| 9,722 | 42,128 | (5) | 13.07 | 1/4/2031 | ||||||||||||||||||||||||||||
| 18,810 | (6) | 59,252 | ||||||||||||||||||||||||||||||
| 21,700 | (7) | 68,355 | ||||||||||||||||||||||||||||||
| James V. Cassella | 140,000 | — | 14.46 | 3/5/2025 | ||||||||||||||||||||||||||||
| 50,000 | — | 16.85 | 1/7/2026 | |||||||||||||||||||||||||||||
| 70,000 | — | 10.97 | 1/4/2027 | |||||||||||||||||||||||||||||
| 46,406 | 3,094 | (2) | 27.59 | 1/4/2028 | ||||||||||||||||||||||||||||
| 51,562 | 23,438 | (3) | 13.93 | 1/4/2029 | ||||||||||||||||||||||||||||
| 18,563 | 23,867 | (4) | 10.87 | 2/13/2030 | ||||||||||||||||||||||||||||
| 11,325 | 49,075 | (5) | 13.07 | 1/4/2031 | ||||||||||||||||||||||||||||
| 18,810 | (6) | 59,252 | ||||||||||||||||||||||||||||||
| 21,700 | (7) | 68,355 | ||||||||||||||||||||||||||||||
| Options Awards | Stock Awards | |||||||||||||
| Name | Number of securities underlying unexercised options (#) exercisable | Number of securities underlying unexercised options (#) unexercisable | Option exercise price ($) | Option expiration date | Number of units of stock that have not vested (#) | Market value of units of stock that have not vested ($) (9) | ||||||||
| Roger D. Tung, Ph.D. | 38,052 | — | (1) | 4.41 | 12/10/2019 | |||||||||
| 29,202 | — | (2) | 3.79 | 12/14/2020 | ||||||||||
| 39,822 | — | (3) | 3.50 | 12/15/2021 | ||||||||||
| 203,300 | — | (4) | 8.40 | 6/10/2024 | ||||||||||
| 116,875 | 53,125 | (5) | 16.85 | 1/7/2026 | ||||||||||
| 87,500 | 112,500 | (6) | 10.97 | 1/4/2027 | ||||||||||
| 37,500 | 162,500 | (7) | 27.59 | 1/4/2028 | ||||||||||
| 20,000 | (10) | 251,000 | ||||||||||||
| Nancy Stuart | 34,512 | — | (1) | 4.41 | 12/10/2019 | |||||||||
| 21,238 | — | (2) | 3.79 | 12/14/2020 | ||||||||||
| 22,122 | — | (3) | 3.50 | 12/15/2021 | ||||||||||
| 100,000 | — | (4) | 8.40 | 06/10/2024 | ||||||||||
| 55,000 | 25,000 | (5) | 16.85 | 01/07/2026 | ||||||||||
| 30,625 | 39,375 | (6) | 10.97 | 01/04/2027 | ||||||||||
| 13,125 | 56,875 | (7) | 27.59 | 01/04/2028 | ||||||||||
| 15,000 | (10) | 188,250 | ||||||||||||
| Marc Becker | — | 100,000 | (8) | 27.59 | 01/04/2028 | |||||||||
| (1) | |||||
| Based on | |||||
| (3) | The unvested shares under this option are scheduled to vest in equal quarterly installments through January 4, 2023. | ||||
| (4) | The unvested shares under this option are scheduled to vest in equal quarterly installments through February 14, 2024. | ||||
| (5) | The unvested shares under this option are scheduled to vest in equal quarterly installments through January 5, 2025. | ||||
| (6) | These restricted stock units | ||||
| (7) | These restricted stock units are scheduled to vest in equal annual installments through January 5, 2024. | ||||
Employment Agreements Severance and Change in Control Arrangements
We have entered into employment agreements with each of our named executive officers. The employment agreements confirm the named executive officers’ titles, compensation arrangements and eligibility for benefits made available to employees generally and also provide for certain benefits upon a termination of employment under specified conditions. Each named executive officer’s employment is at will.
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Under the terms of the employment agreements we have entered into with each of theour named executive officers, if anthe executive’s employment is terminated by us other than for "cause"“cause” and other than as a result of death or disability or by such executive officer for "good reason",“good reason,” each as defined in such employment agreement, in each case not within the "change“change of control period",period,” as defined below, and subject to the executive’s execution of an effective general release of potential claims against us, each named executive officer will be entitled to (1) an amount equal to his or her then-current monthly base salary for a period of 12 months, or 15 months in the case of Dr. Tung, and (2) continued Company paid medical and dental benefits to the extent that the named executive officer was receiving them at the time of termination until the earlier of 12 months following termination, or 15 months following termination in the case of Dr. Tung, and the date the named executive officer’s COBRA continuation coverage expires, subject to certain legal restrictions.to:
| • | An amount equal to 12 months (or 15 months in the case of Dr. Tung) of the named executive officer’s base salary, which will be paid in the form of salary continuation; and | |||||||
| • | Continued Concert-paid medical and dental benefits to the extent that the named executive officer was receiving them at the time of termination until the earlier of 12 months (or 15 months in the case of Dr. Tung) following termination and the date the named executive officer’s COBRA continuation coverage expires, subject to certain legal restrictions. | |||||||
Under the terms of the employment agreements we have entered into with each of theour named executive officers, if the executive’s employment is terminated by us or ourany successor other than for cause or by such executive officer for good reason, in each case within one year following a "change“change of control",control,” as defined in such employment agreement (such one-year period, the "change“change of control period"period”), and subject to the executive’s execution of an effective general release of potential claims against us, in lieu of the severance benefits described above, each named executive officer will be entitled to:
| • | An amount equal to 12 months (or 18 months in the case of Dr. Tung) of the named executive officer’s base salary, which will be paid as a lump sum if the change of control constitutes a change | ||||||||
| Code and otherwise will be paid in the form of salary continuation; | |||||||
| • | An amount equal | ||||||
| the greater of the named executive officer’s current target bonus or the actual bonus paid to the named executive officer for the immediately preceding calendar year; and | |||||||
| • | Continued | ||||||
In addition, if aduring the change of control occurs and within one year following such change of controlperiod, we or ourany successor terminate the executive’snamed executive officer’s employment other than for cause, or the executive’snamed executive officer’s employment ends due to the executive'snamed executive officer’s death or disability, or the named executive officer terminates his or her employment for good reason, then all stock options held by the named executive officer will immediately vest in full.
If the payments or benefits payable to any named executive officer in connection with a change of control would be subject to the excise tax imposed under Section 4999 of the Internal Revenue Code, then those payments or benefits will be reduced to the extent necessary to avoid the imposition of such excise tax, but only if such reduction would result in a higher net after-tax benefit to the named executive officer.
| Name | Cash Severance ($) (1) | Bonus ($) (2) | COBRA Continuation ($) (3) | Value of Accelerated Vesting of Stock Options ($) (4) | Total ($) | ||||||||||
| Roger D. Tung, Ph.D. | |||||||||||||||
| Qualifying termination not in connection with a change of control | 669,389 | — | 37,965 | — | 707,354 | ||||||||||
| Qualifying termination in connection with a change of control | 803,267 | 401,633 | 45,558 | 177,750 | 1,428,208 | ||||||||||
| Nancy Stuart | |||||||||||||||
| Qualifying termination not in connection with a change of control | 412,186 | — | 28,536 | — | 440,722 | ||||||||||
| Qualifying termination in connection with a change of control | 412,186 | 164,874 | 28,536 | 62,213 | 667,809 | ||||||||||
| Marc Becker | |||||||||||||||
| Qualifying termination not in connection with a change of control | 375,682 | — | 30,606 | — | 406,288 | ||||||||||
| Qualifying termination in connection with a change of control | 375,682 | 150,273 | 30,606 | — | 556,561 | ||||||||||
Other agreementsAgreements
We have also entered into employee confidentiality, non-competition and proprietary information agreements with each of our named executive officers. Under the employee confidentiality, non-competition and proprietary information agreements, each named executive officer has agreed (1) not to compete with us during his or her employment and for a period of one year after the termination of his or her employment, (2) not to solicit our employees during his or her employment and for a period of
one year after the termination of his or her employment, (3) to protect our confidential and proprietary information and (4) to assign to us related intellectual property developed during the course of his or her employment.
401(k) retirement planRetirement Plan
We maintain a 401(k) retirement plan that is intended to be a tax-qualified defined contribution plan under Section 401(k) of the Internal Revenue Code. In general, all of our employees are eligible to participate, beginning on the first day of the month following commencement of their employment. The 401(k) plan includes a salary deferral arrangement pursuant to which participants may elect to reduce their current compensation by up to the statutorily prescribed limit, equal to $18,500$19,500 in 2018,2021, and have the amount of the reduction contributed to the 401(k) plan. Participants over the age of 50 are entitled to an additional catch-up contribution up to the statutorily prescribed limit, equal to $6,000$6,500 in 2018.2021. Currently, we match 50% of employee contributions up to 6% of the employee’s salary, subject to the statutorily prescribed limit, equal to $8,250$8,700 in 2018.2021. The match immediately vests in full.
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Securities Authorized for Issuance Under Equity Compensation Plans
The following table provides information about the securities authorized for issuance under our equity compensation plans as of December 31, 2018.2021.
| Plan category | Number of securities to be issued upon exercise of outstanding options, warrants and rights | Weighted-average exercise price of outstanding options, warrants and rights | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) | |||||||||||||||||||||||
| (a) | (b) | (c) | ||||||||||||||||||||||||
| Equity compensation plans approved by security holders | 5,825,512 | (1) | $ | 14.21 | 1,463,441 | (2) | ||||||||||||||||||||
| Equity compensation plans not approved by security holders | — | — | — | |||||||||||||||||||||||
| Total | 5,825,512 | $ | 14.21 | 1,463,441 | ||||||||||||||||||||||
| Plan category | Number of securities to be issued upon exercise of outstanding options, warrants and rights | Weighted-average exercise price of outstanding options, warrants and rights | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) | ||||||||
| (a) | (b) | (c) | |||||||||
| Equity compensation plans approved by security holders | 3,785,556 | (1) | $ | 15.26 | 1,488,976 | (2) | |||||
| Equity compensation plans not approved by security holders | — | — | — | ||||||||
| Total | 3,785,556 | $ | 15.26 | 1,488,976 | |||||||
| (1) | Consists of stock options and restricted stock units outstanding as of December 31, | ||||
| (2) | Consists of shares of common stock authorized under the 2014 Plan that remained available for grant under future awards as of December 31, Board. | ||||
STOCK OWNERSHIP AND REPORTING
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth information, to the extent known by us or ascertainable from public filings, with respect to the beneficial ownership of our common stock as of March 31, 20192022 by:
| • | each person, or group of affiliated persons, who is known by us to beneficially own more than 5% of our common | |||||||
| • | each of our named executive officers; | |||||||
| • | each of our directors and director nominees; and | |||||||
| • | all of our executive officers and directors as a group. | |||||||
Beneficial ownership is determined in accordance with the rules and regulations of the SEC. These rules generally attribute beneficial ownership of securities to persons who possess sole or shared voting power or investment power with respect to those securities and include shares of common stock issuable upon the exercise of stock options that are immediately exercisable or exercisable within 60 days after March 31, 2019.2022 and restricted stock units that are scheduled to vest within 60 days after March 31, 2022. Except as otherwise indicated, to our knowledge, all of the shares reflected in the table are shares of common stock and all persons listed below have sole voting and investment power with respect to the shares beneficially owned by them, subject to community property laws, where applicable. The information is not necessarily indicative of beneficial ownership for any other purpose.
The percentage ownership calculations for beneficial ownership are based on 23,756,80134,953,342 shares of common stock outstanding as of March 31, 2019.2022. Except as otherwise indicated in the table below, addressesthe address of namedeach beneficial owners are in care ofowner is c/o Concert Pharmaceuticals, Inc., 65 Hayden Avenue, Suite 3000N, Lexington, MassachusettsMA 02421.
In computing the number of shares of common stock beneficially owned by a person and the percentage ownership of that person, we deemed outstanding any shares of common stock subject to options held by that person that are currently exercisable or are exercisable within 60 days after March 31, 2019. We2022 and restricted stock units held by that person that are scheduled to vest within 60 days after March 31, 2022. However, we did not deem these shares outstanding however, for the purposepurposes of computing the percentage ownership of any other person.
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| Name of beneficial owner | Number of shares beneficially owned | Percentage of shares beneficially owned | ||||
| 5% Stockholders | ||||||
Entities affiliated with Perceptive Advisors, LLC (1) | 1,873,779 | 7.9 | % | |||
Entities affiliated with RTW Investments, LP (2) | 1,811,662 | 7.6 | % | |||
Entities affiliated with BlackRock Inc.(3) | 1,700,485 | 7.2 | % | |||
Entities affiliated with BVF (4) | 1,381,845 | 5.8 | % | |||
Ingalls & Snyder LLC (5) | 1,199,775 | 5.1 | % | |||
Entities affiliated with GlaxoSmithKline (6) | 1,179,941 | 5.0 | % | |||
| Executive Officers and Directors | ||||||
Roger D. Tung, Ph.D.(7) | 1,375,570 | 5.6 | % | |||
Nancy Stuart (8) | 379,037 | 1.6 | % | |||
Marc Becker (9) | 38,125 | * | ||||
Richard H. Aldrich (10) | 423,281 | 1.8 | % | |||
Thomas G. Auchincloss (11) | 66,500 | * | ||||
Ronald W. Barrett, Ph.D.(12) | 37,500 | * | ||||
Christine van Heek (13) | 40,417 | * | ||||
Peter Barton Hutt, LL.M (14) | 56,080 | * | ||||
Wilfred E. Jaeger, M.D.(15) | 37,500 | * | ||||
Wendell Wierenga, Ph.D.(16) | 77,677 | * | ||||
All current executive officers and directors as a group (11 persons) (17) | 2,793,008 | 11.0 | % | |||
| Name of Beneficial Owner | Number of Shares of Common Stock Beneficially Owned | Percentage of Shares of Common Stock Beneficially Owned | |||||||||||||||
| 5% Stockholders | |||||||||||||||||
Entities affiliated with Perceptive Advisors LLC (1) | 3,950,641 | 10.75 | % | ||||||||||||||
Entities affiliated with BVF Partners L.P. (2) | 3,629,334 | 9.99 | % | ||||||||||||||
Entities affiliated with RA Capital Healthcare Fund, L.P. (3) | 3,542,697 | 9.99 | % | ||||||||||||||
| Named Executive Officers and Directors | |||||||||||||||||
Roger D. Tung (4) | 1,924,132 | 5.34 | % | ||||||||||||||
Marc A. Becker (5) | 262,985 | * | |||||||||||||||
James V. Cassella (6) | 468,630 | 1.33 | % | ||||||||||||||
Richard H. Aldrich (7) | 490,850 | 1.40 | % | ||||||||||||||
Thomas G. Auchincloss, Jr. (8) | 99,188 | * | |||||||||||||||
Ronald W. Barrett (9) | 67,688 | * | |||||||||||||||
Jesper Høiland (10) | 40,605 | * | |||||||||||||||
Peter Barton Hutt (11) | 79,190 | * | |||||||||||||||
Wilfred E. Jaeger (12) | 67,688 | * | |||||||||||||||
Christine van Heek (13) | 86,832 | * | |||||||||||||||
All executive officers and directors as a group (12 persons) (14) | 4,276,245 | 11.33 | % | ||||||||||||||
| * | Represents beneficial ownership of less than 1% of our outstanding | ||||
| (1) | Consists of (i) 2,150,641 shares of common stock and (ii) 1,800,000 shares of common stock underlying a warrant that is exercisable as of March 31, 2022. Based on information set forth in a Schedule | ||||
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| (2) | Consists of | ||||
own more than 9.99% of the outstanding shares of common stock (the “BVF Conversion Limitation”). In the absence of the BVF Conversion Limitation, the Additional BVF Shares and, upon exercise of the warrants, the BVF Warrant Shares would be convertible into an aggregate of 13,871,000 shares of common stock.
Based on information set forth in a Schedule 13G filed with the | |
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| (3) | Consists of | ||||
| warrants, the RA Warrant Shares are not eligible to be converted into common stock as of March 31, 2022 due to a conversion limitation that prevents the Fund from converting Series X1 preferred stock to common stock if, after such conversion, entities affiliated with the Fund would beneficially own more than 9.99% of the outstanding shares of common stock (the “RA Conversion Limitation”). In the absence of the RA Conversion Limitation, the Additional RA Shares and, upon exercise of the warrants, the RA Warrant Shares would be convertible into an aggregate of 14,491,000 shares of common stock. Based on information set forth in a Schedule | |||||
| (4) | Consists of | ||||
| (5) | Consists of (i) 33,540 shares of common stock and (ii) 229,445 shares of common stock underlying options that are exercisable as of March 31, | ||||
| (7) | Consists of (i) 336,975 shares of common stock held | ||||
| (8) | Consists of (i) 6,500 shares of common stock | ||||
| (10) | Consists of 40,605 shares of common stock underlying options that are exercisable as of March 31, | ||||
| (11) | Consists of (i) 7,963 shares of common stock and (ii) 71,227 shares of common stock underlying options that are exercisable as of March 31, 2022 or will become exercisable within 60 days after such date. | ||||
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| (12) | Consists of | ||||
| (13) | Consists of | ||||
| (14) | |||||
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Our executive compensation program is designed to attract, motivate and retain our chief financial officer may present a related person transaction arising in the time period between meetings of the audit committee to the chair of the audit committee, who will review and may approve the related person transaction, subject to ratification by the audit committee at the next meeting of the audit committee.
The “Executive Compensation” section of this proxy statement describes our executive compensation program and the decisions made by our compensation committee inand our Board with respect to the manner to be specified inyear ended December 31, 2021. Our executive compensation program embodies a pay-for-performance philosophy that supports our business strategy and aligns the charterinterests of our named executive officers with our stockholders. Our Board believes that this link between compensation and the compensation committee.
Our Board is asking stockholders to approve a non-binding, advisory vote on the following resolution:
RESOLVED, that the compensation paid to Concert’s named executive officers, as disclosed pursuant to the compensation disclosure rules of the Company’s common stock to report their initial ownership ofSecurities and Exchange Commission, the common stock and other equity securitiescompensation tables and any changes in that ownership in reports that must be filed with the SEC. The SEC has designated specific deadlines for these reports, and we must identifyrelated material disclosed in this proxy statement, those persons who did not file these reports when due.
As an advisory vote, this proposal is not binding. The outcome of reports furnished tothis advisory vote does not overrule any decision by us or written representations from reporting persons, we believe all directors,our Board (or any committee thereof), create or imply any change to the fiduciary duties of us or our Board (or any committee thereof), or create or imply any additional fiduciary duties for us or our Board (or any committee thereof). However, our compensation committee and our Board value the opinions expressed by our stockholders in their vote on this proposal and will consider the outcome of the vote when making future compensation decisions for our named executive officers, and 10% owners timely filed all reports regarding transactions in the Company’s securities required to be filed for 2018 by Section 16(a) under the Exchange Act.officers.
Recommendation of our Board
OUR BOARD UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS VOTE FOR APPROVAL, ON A NON-BINDING, ADVISORY BASIS, OF THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS.
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PROPOSAL NO. 2—3 – RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP
AS THE COMPANY’SOUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE
FISCAL YEAR ENDING DECEMBER 31, 20182022
The audit committee is solely responsible for selecting the Company’sour independent registered public accounting firm for the fiscal year ending December 31, 2018.firm. Stockholder approval is not required to appoint Ernst & Young LLP as our independent registered public accounting firm. However, theour Board believes that submitting the appointment of Ernst & Young LLP to the Stockholdersstockholders for ratification is good corporate governance. If stockholders do not ratify this appointment, the audit committee will reconsider whether to retain Ernst & Young LLP. If the selection of Ernst & Young LLP is ratified, the audit committee, in its discretion, may direct the appointment of a different independent registered public accounting firm at any time it decides that such a change would be in the best interestinterests of the CompanyConcert and itsour stockholders.
A representative of Ernst & Young LLP is expected to be present at the Annual Meeting and will have an opportunity to make a statement if he or she desires to do so and to respond to appropriate questions from our stockholders.
The following table summarizes the fees Ernst & Young LLP, our independent registered public accounting firm, billed to us for each of the last two fiscal years.
| Fee Category | 2021 | 2020 | ||||||||||||||||||
Audit Fees (1) | $ | 593,000 | $ | 665,000 | ||||||||||||||||
Tax Fees (2) | 29,944 | 68,910 | ||||||||||||||||||
All Other Fees (3) | 2,180 | 5,175 | ||||||||||||||||||
| Total Fees | $ | 625,124 | $ | 739,085 | ||||||||||||||||
| Fee Category | 2018 | 2017 | ||||||
Audit Fees (1) | $ | 533,920 | $ | 634,567 | ||||
Tax Fees (2) | 25,000 | 48,450 | ||||||
All Other Fees (3) | 5,055 | 2,000 | ||||||
| Total Fees | $ | 563,975 | $ | 685,017 | ||||
| (1) | Audit | ||||
| (2) | Tax | ||||
| (3) | All Other Fees | ||||
Pre-approval Policy and Procedures
The audit committee of our Board has adopted policies and procedures for the pre-approval of audit and non-audit services for the purposepurposes of maintaining the independence of our independent auditor. We may not engage our independent auditor to render any audit or non-audit service unless either the service is approved in advance by the audit committee, or the engagement to render the service is entered into pursuant to the audit committee’s pre-approval policies and procedures. Notwithstanding the foregoing, pre-approval is not required with respect to the provision of services, other than audit, review or attest services, by the independent auditor if the aggregate amount of all such services is no more than 5% of the total amount paid by us to the independent auditor during the fiscal year in which the services are provided, such services were not recognized by us at the time of the engagement to be non-audit services and such services are promptly brought to the attention of the audit committee and approved prior to completion of the audit by the audit committee.
From time to time, our audit committee may pre-approve services that are expected to be provided to us by the independent auditor during the following 12 months. At the time such pre-approval is granted, the audit committee must identify the particular pre-approved services in a sufficient level of detail so that our management will not be called upon to make a judgment as to whether a proposed service fits within the pre-approved services and, at each regularly
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scheduled meeting of the audit committee following such approval, management or the independent auditor shall report to the audit committee regarding each service actually provided to us pursuant to such pre-approval.
During our 20182021 and 20172020 fiscal years, no services were provided to us by Ernst & Young LLP or any other accounting firm other than in accordance with the pre-approval policies and procedures described above.
Recommendation of theour Board
OUR BOARD UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE RATIFICATION OF ERNST & YOUNG LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM.FIRM FOR THE FISCAL YEAR ENDING DECEMBER 31, 2022.
PROPOSAL NO. 4 – APPROVAL OF AN AMENDMENT TO OUR CERTIFICATE OF INCORPORATION TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK
Background
Our authorized capital stock presently consists of 100,000,000 shares of common stock, par value $0.001 per share, and 5,000,000 shares of preferred stock, par value $0.001 per share. Our Board has adopted and is recommending that our stockholders approve a proposed amendment to our certificate of incorporation to increase the number of authorized shares of common stock from 100,000,000 to 200,000,000. The number of shares of preferred stock authorized for issuance would not be affected by the proposed amendment.
As of April 12, 2022, a total of:
•36,329,342 shares of common stock were issued and outstanding;
•1,861,273 shares of common stock were issuable upon the exercise of outstanding warrants;
•12,621 shares of Series X1 preferred stock were issued and outstanding, which are convertible into 12,621,000 shares of common stock;
•16,250 shares of Series X1 preferred stock were issuable upon the exercise of outstanding warrants, which are convertible into 16,250,000 shares of common stock;
•5,048,014 shares of common stock were subject to outstanding stock options under the 2006 Plan and the 2014 Plan;
•1,389,460 shares of common stock were subject to outstanding restricted stock units under the 2014 Plan; and
•2,026,725 shares of common stock were reserved for future issuance under the 2014 Plan.
Accordingly, out of the 100,000,000 shares of common stock presently authorized, 75,525,814 shares of common stock are issued or reserved for issuance, and only 24,474,186 shares of common stock remain available for future issuance.
If stockholders approve the proposed amendment, the first paragraph of Article FOURTH of our certificate of incorporation will be deleted in its entirety and replaced by the following:
“FOURTH: The total number of shares of all classes of stock which the Corporation shall have authority to issue is 205,000,000 shares, consisting of (i) 200,000,000 shares of Common Stock, par value $0.001 per share (“Common Stock”), and (ii) 5,000,000 shares of Preferred Stock, par value $0.001 per share (“Preferred Stock”).”
The proposed amendment, if approved by our stockholders, would become effective upon the filing of an amendment to our certificate of incorporation with the Secretary of State of the State of Delaware, in the form of Appendix A hereto, or at the later time set forth in such amendment. Our Board reserves the right, notwithstanding stockholder approval and without further action by stockholders, to elect not to proceed with the proposed amendment if our Board determines that the proposed amendment is no longer in our best interests and the best interests of our stockholders.
If our stockholders approve the proposed amendment, subject to the discretion of our Board, we intend to file the amendment to our certificate of incorporation with the Secretary of State of the State of Delaware as soon as practicable after the Annual Meeting.
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Reasons for the Proposed Increase
Over the past several years, we have used shares of our common stock to, among other things, engage in financings, compensate employees and for other general corporate purposes. The additional authorized shares of common stock permitted by the proposed amendment to our certificate of incorporation would allow us to continue to use common stock for purposes such as financings, providing equity incentives to our employees, officers or directors, business development activities and other nominee record holdersgeneral corporate purposes as our Board may be participating in the practiceapprove. Our Board believes that having a sufficient number of “householding” proxy statements and annual reports. This means that only one copyauthorized shares of our documents, including the annual reportcommon stock provides flexibility to stockholdersraise cash to carry out our overall strategy and proxy statementallows us to engage in strategic activities without using our cash. We do not currently have any specific plans, proposals or the Notice, may have been sent to multiple stockholders in your household. We will promptly deliver a separate copy of either document to you uponarrangements, written or oral, requestto issue any of the proposed additional authorized shares of common stock for general corporate or any other purposes. Unless required by applicable law or stock exchange rules, no further vote of the holders of common stock will be required.
Potential Effects of the Proposed Increase
The additional shares of common stock for which authorization is sought would be identical in powers, privileges and rights to the Company. Concert Pharmaceuticals, Inc. 65 Hayden Avenue, Suite 3000N, Lexington, MA 02421, Attention: Investor Relations, telephone: 781-860-0045. shares of common stock that are now authorized. Holders of common stock do not have preemptive rights to subscribe to additional securities that we may issue.
The issuance of additional shares of common stock would not affect the rights of stockholders of currently outstanding common stock, except for effects incidental to increasing the number of shares of common stock outstanding, such as, among other things, having a dilutive effect on earnings per share and on stockholders’ equity and voting rights. Furthermore, future sales of substantial amounts of our common stock, or the perception that these sales might occur, could adversely affect the prevailing market price of our common stock or limit our ability to raise additional capital. Stockholders should recognize that, as a result of this proposal, they will own a smaller percentage of our shares relative to the total number of authorized shares than they presently own.
Our Board has not proposed this increase in the number of authorized shares with the intention of discouraging tender offers or takeover attempts. However, the availability of additional authorized shares for issuance may have the effect of discouraging a merger, tender offer, proxy contest or other attempt to obtain control.
Effectiveness of Amendment
If you wantthe proposed amendment is adopted, it will become effective upon the filing of a certificate of amendment to receive separate copiesour certificate of incorporation with the Secretary of State of the Notice, proxy statement or annual report to stockholders in the future, or if you are receiving multiple copies and would like to receive only one copy per household, you should contact your bank, broker or other nominee record holder, or you may contact us at the above address and phone number.State of Delaware.
OTHER MATTERS
Our Board does not know of any other matters to be brought before the Annual Meeting. If any other matters not mentioned in this proxy statement are properly brought before the meeting, the individuals named in this proxy statement intend to use their discretionary voting authority under the proxy to vote the proxy in accordance with their best judgment on those matters.
Householding
Stockholder Proposals
A stockholder who would like to have a proposal considered for inclusion in our 2023 proxy statement must submit the proposal in accordance with the procedures outlined in Rule 14a-8 of the Exchange Act so that it is received by us no later than [_____], 2022, which is 120 days prior to the first anniversary of the mailing date of the Notice. However, if the date of our 2023 annual meeting of stockholders is changed by more than 30 days from the date of this year’s Annual Meeting, then the deadline is a reasonable time before we begin to print and send our proxy statement for our 2023 annual meeting of stockholders. SEC rules set standards for eligibility and specify the types of stockholder proposals that may be excluded from a proxy statement. To comply with the universal proxy rules (once effective), stockholders who intend to solicit proxies in support of director nominees other than the Company’s nominees must provide notice that sets forth the information required by Rule 14a-19 under the Securities Exchange Act of 1934 no later than April 10, 2023.
The required notice must be in writing and received by our corporate secretary at our principal executive offices not less than 90 days nor more than 120 days prior to the first anniversary of the preceding year’s annual meeting. However, in the event that the date of the annual meeting is advanced by more than 20 days, or delayed by more than 60 days, from the first anniversary of the preceding year’s annual meeting, a stockholder’s notice must be so received no earlier than the 120th day prior to such annual meeting and not later than the close of business on the later of (A) the 90th day prior to such annual meeting and (B) the tenth day following the day on which notice of the date of such annual meeting was mailed or public disclosure of the date of such annual meeting was made, whichever first occurs. For stockholder proposals to be brought before our 2023 annual meeting of stockholders, assuming that the date of such annual meeting is not advanced by more than 20 days, or delayed by more than 60 days from the first anniversary of this year’s Annual Meeting, the required notice must be received by our corporate secretary at our principal executive offices no earlier than February 9, 2023 and no later than March 11, 2023.
Stockholder proposals should be addressed to Concert Pharmaceuticals, Inc., 65 Hayden Avenue, Suite 3000N, Lexington, MA 02421, Attention: Corporate Secretary.
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Appendix A
CERTIFICATE OF AMENDMENT TO
RESTATED CERTIFICATE OF INCORPORATION
OF
CONCERT PHARMACEUTICALS, INC.
(Pursuant to Section 242 of the
Delaware General Corporation Law)
Delaware General Corporation Law)
Concert Pharmaceuticals, Inc. (the “Corporation”), a corporation organized and existing under and by virtue of the provisions of the Delaware General Corporation Law (the “DGCL”), does hereby certify as follows:
A resolution was duly adopted by the Board of Directors of the Corporation pursuant to Section 242 of the DGCL setting forth a proposed amendment to the Restated Certificate of Incorporation of the Corporation and declaring said amendment to be advisable. The stockholders of the Corporation duly approved said proposed amendment in accordance with Section 242 of the DGCL. The resolution setting forth the amendment is as follows:
RESOLVED: That the first paragraph of Article FOURTH of the Restated Certificate of Incorporation of the Corporation be and hereby is deleted in its entirety and the following is inserted in lieu thereof:
“FOURTH: The total number of shares of all classes of stock which the Corporation shall have authority to issue is 205,000,000 shares, consisting of (i) 200,000,000 shares of Common Stock, par value $0.001 per share (“Common Stock”), and (ii) 5,000,000 shares of Preferred Stock, par value $0.001 per share (“Preferred Stock”).”
***
A-1
IN WITNESS WHEREOF, this Certificate of Amendment has been executed by its duly authorized officer this ____ day of ________, 2022.
CONCERT PHARMACEUTICALS, INC.
By:
Name: Roger D. Tung
Title: President and Chief Executive Officer
A-2
